 Here thank you and welcome We have no public hearing that item 2 Item 3 is the opportunity for the board members to pull any items off the consent agenda they wish to discuss further I Was going to request that item 4.6 People I just have a couple questions Okay Mover oh, no, you need to own that item will be discussed at the end of the open meeting So it's not going to be discussed now, but now It's time for a public comment on the entirety of the consent agenda. Good evening. My name is Becky Steinbruner Thank you for pulling item 4.6. I had questions about that as well on Item 4.3 in the operations and maintenance. I know that your board has still not Had any reviews or public discussions of the water transfer pilot purchase price as Was requested by director Jaffe on August 18th 2020 I would really like to see that especially since the city of Santa Cruz I know the pilot is pretty much ended But the agreement is still there and the city of Santa Cruz is doing some amazing projects that will really encourage regional water sharing Item 4.4 public outreach committee I know there was only one committee member there and the same for Item 4.5 only one committee member there lots of staff So I'm wondering why these meetings are happening What's their purpose and I would really hope that there could be more ratepayers involved in these committees Item 4.8 the salaries I know that all Employees are getting a 5% raise effective January 1st Even though the CPI for our area cost price index is 2.8 I I know you have good employees, but your District is in financial trouble and so I really am worried about that Thank you that We discussed that a couple meetings beforehand, you know in the past. This is just on the consent agenda because it's official issue officializing the whole process It's long and coming in And President Christian said I'll note that there's some incorrect information Spoken just then regarding the 5% It was on on there Did you want to elaborate that just on the incorrect information? She has a miss a misunderstanding of it that not all employees got a 5% Cip inflation adjustment I'll move approval of the remaining parts of the consent agenda I'll second all in favor Yeah I I Any opposed? Okay. It's passed unanimously Oral and written communications This is for those of anybody who hasn't been here before this is the opportunity to speak and items that are not on the agenda Three minutes So we'll open it up to the public right now and just to clarify I got that information from your agenda packet So maybe I didn't read it properly. I'll look again for this piece I want to Inform the listening audience and your board December 15th the Central Coast Regional Water Quality Control Board will be considering the two permits For the Pure Water SoCal project one to inject the treated sewage water into the aquifer And it is not distilled water I'm hearing people that have gone through the tour saying oh, it's going to be distilled water. It's not and The nitrate has been reduced to one point six seven milligrams per liter That's not distilled and the chloride will be thirty three milligrams per liter. That's not distilled So the public comment will be available the public hearing that day in San Luis Obispo and also on Zoom the second permit considered will be to dump the contaminate contaminated concentrate called brine into the Monterey Bay I'm happy to read the application that there will be some mixing in a vault sort of affair before that goes out into our bay and there is a leak in the Outfall about 65 feet from shore. So I'm happy to see that there will be some mixing I want to point out that there is no irrigation Permitted with this recycled water. It's not part of this permitting process. It's clearly stated in there So your agreement with Twin Lakes Church to provide three acre feet a year of water For their irrigation for free for 50 years is going to be potable water Until that permit is adjusted. I Also want to let you and the listeners know that the 2022 state funded AEM the magnetic resonance Snapshot of the the bay area saltwater freshwater Interface is now that the results of that is now out and available It's a much different kind of report than the one that the mid-county groundwater agency, which you helped fund in 2017 unfortunately, the State helicopter did not fly very much over the area where I Think is of most interest that is the area along the coast. They only made two very broad and wide sweeps But they did a lot of inland Exploration which I thought was odd because When the MGA did theirs We were told that they couldn't fly over populated areas, but the state funded helicopter did So it's an interesting report a much different report and I have you all to read it. Thank you very much One thing I think during the tour either people of the tour who spoke with you were Misheard, but it's not distilled water. I don't think that ever comes up in the tour It was just a misunderstanding known as presenting the outfall as the output of this plant is distilled water Just a misstatement. I don't know so Any comments or communications from the board? Yes, I just wanted to ask I'm very interested in following through on getting some youth involved as non-voting members of our board or for some kind of a junior Standing committee and I would love to volunteer to head up that effort and I just like to have that Possibly be agendized at a future meeting No reports We're on to administrative business 7.1 no conditional or unconditional wills serves reported today and 7.2 is the annual election of vice president by the board of directors and this is process where whoever is elected to the vice presidency Moves to be the president next year. Oh, I I'm speaking I will Take it. Is there anyone else? I'm nominating Rochelle Lather to be the vice president second All in favor hi, hi any opposed. Thank you Rochelle Okay Review and consider compensation for district directors according to ordinance number 20. Oh one and Very anybody in the public is looked at the packet Oh, Tracy's Good evening President Christensen board. I'm presenting to you tonight the the board's opportunity to review and consider compensation changes for Directors as you know, we have ordinance number 20-01 that sets forth the process by which the board takes action on its compensation and That ordinance is governed under California water code for For The amount that is set forth in the code for annual adjustments by a public agency such as ours So I'm presenting to you tonight information in regards to our current board of compensation levels as you can see in the memo The district currently pays board members $200 per day for each day's attendance at regular board meetings Excuse me the compensation the ordinance sets forth the compensation and Currently the the rate the 2023 rate is at $200 per day for each day's attendance at a regular board meeting $200 per day for each day's attendance at standing committee meetings $200 per day for each day service rendered that involves out-of-town travel and $100 per day for authorized service within Santa Cruz County included in the memo as part of the attachment number two You can see the history of Directors annual compensation adjustments. It's pretty rare that you guys give yourself adjustments And that attachment to on the item certainly shows that history If the board is considering Compensation adjustments Obviously, we've all been talking about inflation. So if you are considering adjustments This year the board has the accumulative percentages available of up to $113.43 for each of those line items that I just addressed And if there's any questions, I'm happy to Answer them I do So This is public service There is compensation But I don't think any of us are doing it here for the compensation. So and In the 21 years, I've been on the board. There's been two times when there's been an adjustment and I Don't think that just needs to occur. I will say that Some meetings Where there's large packets It Can take many hours to prepare for the meeting in addition to the meeting time So it's not just the meeting time that the directors are putting into this work Yeah, I think I it was I who proposed the last rate adjustment that I don't We are trying to recognize costs and doing our part Increase those costs Please oh, sorry, um, anyway, I'm gonna open up to the public. They have any comments. Can I say one thing first? Okay, or should we listen to the public first? Okay Well, Tony Crane I'm a paying So-called Creek member So it sounds like you you're not thinking about Requesting an increase that overseeing Okay, that seems the consensus at the moment. Okay. Yeah, that's good I would suggest that I think it would be in or taste at this point when we're looking at rate increases to do something like that So I appreciate that. Thank you. I'm on my Yeah, I have a strong change of opinion And I think that increasing the stipend would attract more diverse and also more youthful Individuals and we need to create a better equipped board to address the upcoming complex challenges associated with climate disruption and Growth in complex water policies in our future So the state law provides for a daily stipend of three one three point four three And I think we should definitely have what the law allows. I think this again would really increase our diversity And we're not thinking about just ourselves, but everyone else that who could participate So that's I'm strongly urging this. Thank you. That's a good point I don't know that we need to make a motion if we're unless we want to increase it, right? Let's take no action That's correct. So no motions fired. He missed the board doesn't you should take action I Don't think we're going to act this year Sure, I make a motion to adjust the current Board of Directors compensation That's two hundred dollars per day up to the required the allowable three Thirteen point four three for regular board meetings standee committing meetings and services rendered as a director Involving out-of-town travel to amount of three thirteen forty three. All right any takers on this motion? I Don't believe there's a second. Okay. Thank you for your good. I You know I sympathize of that I think it would help help, but I think it this is not the appropriate moment All right Moving on to seven point four. It's requesting board direction on 2223 rate study proposed rate structures and That's what we've been trying to discuss and I know costs are involved You know constant implicit that but we'd like to get that Refined and are you going to look it over? Yeah, so tonight? I'm here to present item seven point four We did bring a Rate memo to the board at the November 20th meeting and at that time We were modeling the modified two-tier structure and the three-tiered rate structure with a 50% fixed cost allocation and a 50% variable use cost Allocation and so tonight we're at that board meeting the board requested that we bring back some more modeling and to identify the structures at 40% fixed cost allocation 50% and 60% so Raft Ellis did the modeling and Put together some slides for us that show what difference that does make we have kind of Worked very hard This time on the rates. I know this is a difficult rate Study that we're undergoing right now. We have worked very hard at different modeling attempts And it's not moving the needle very much But we will we will show you what those changes that we made to the structured what that impact does have on the customer bills Yeah, so and tonight presenting you gave an intro our assistant general manager Melanie now shoe markers gonna present and then followed either by Kevin with Raft Ellis and he's doing dual role tonight. So if he is not Able to jump over to our meeting Leslie's gonna fill in and do do that part too. I'll hand it to Melanie. Thank you Great, thank you I have about a half a dozen slides again mostly for the general public and those who may watch this Recording later just a kind of some slides to introduce again the district our water challenges and Kind of the information that helps feed into the rate study that is currently underway So obviously, you know, many of us know Who are intimately working or presiding over the SoCal Creek Water District? That we are a not-for-profit local government agency specializing in water Specifically for now we are a hundred percent groundwater and we're providing and our mission to is for safe high-quality reliable and sustainable water supply for our community's present and future needs and of course in an environmentally and economically responsible manner We are a small but mighty water agency We do serve the unincorporated areas of Santa Cruz County Including Aptos the Selva Beach Seascape C Cliff Soquel and then of course portions of the incorporated area of the city of Capitola. We serve about 40,000 customers or residents through 16,000 connections approximately and We're proud to be able to provide water to residents but as but also to Support over 18,000 jobs 22 parks in our region and also 18 schools As you can see on the cinematographic. This just itemizes kind of some of the day-to-day Activities programs projects and infrastructure that make up the Soquel Creek Water District Obviously, we always like to start with kind of the why obviously for us. It's all about water And we're proud of that but with water in Santa Cruz County comes our local water supply challenges It's probably a lot better. Thank you comes it stills. Oh, there you go is The water supply challenges that we've been facing for a couple decades and that of course is Something that we've been talking about with the public For for many years and that is that we are challenged with Seawater contamination of our groundwater basin the Santa Cruz Mid-County groundwater basin has been designated as one of 21 basins in California With the designation of being critically overdrafted and a high priority And we are mandated Here to bring the basin back into sustainability by 2040 locally a groundwater sustainability agency was established With the provisions to create a groundwater sustainability plan Soquel Creek Water District is a part of that groundwater sustainability agency We're of course also faced with additional challenges including stricter water quality standards such as chromium 6 and Also addressing future climate change impacts Address this first thing. I think this is such a critical slide just for the couple new Folks new in the audience See water intrusion. That's our nemesis and you can see the red Up in the upper graph there photograph and The red is seawater intrusion detected by technology Geophysical technology right at our shoreline We knew we had it either side of the district where the red dots go in there and then the other side. Thank you, Melanie Now if you look at the lower graph, you can see that top graphs an inset right there but as you go south The seawater intrusion is in already three miles down in Watsonville if you go on down to Monterey It's about 10 miles in almost a slieness So now if you extrapolate out to the world the vast majority vast majority of populated coastal regions of the world that rely on groundwater Already have seawater intrusion in them. It basically ruins your aquifer but we have been given the gift through technology to know that It's knocking on our door hydrologist said it'd be two years if we didn't change our pumping and And and ask people to Cut back in the emergency situation. Just be a matter a couple years for the seawater intrusion Wiped out our main well-filled and if it was at our door and it was so it was Stage three that we've been in I think is a very prudent method and again We have the gift as a community To fit to succeed where so many have failed before us to stop it and you can see just to the south I mean that's as close as you can get to home If you go around the world most other most others have failed too. So I think this is what so called freak is is a lot about is trying to prevent Where others have not had the ability to to put up that good offense Thank you I think one other thing to point out and of course it's kind of included in that first bullet But you know, we are locally sourced in terms of our water We're also unlike a lot of areas in California that have a more diversified water portfolio So we do not receive any state or imported water here in our region It's only what is locally sourced from rainfall that falls on the side of the Santa Cruz Mountains So it's another challenge that we're faced with. I think with the Far down I'm not able to Okay, as mentioned last time and this is also something that we're we do like to convey to To the community members is that we did conduct an economic impact study related to a sustainable water supply here in our region A dr. Brent Haddad with ucse Conducted this study that kind of calculated the benefits related to a sustainable water supply with pure water soquel Being able to meet that water shortage gap and and bring our base in a sustainability provided almost a billion dollars An economic benefit from both residential environmental and business needs and the other important thing to note with relationship to this study was that he evaluated the cost of water with and without a water supply And the findings were that without a sustainable water supply without An additional source without having another supply like imported state water The outcome would be that we would have to charge our customers three times as much for water if we didn't have another source One thing that we're proud of here Is that soquel creek water district and our project pure water soquel has been recognized worldwide Last year in 2022 the international waters association Created a global film series by bbc storyworks called beneath the surface It featured 16 projects around the world as you can see on that left-hand side Of projects that were really focused on water sustainability The santa cruz county california project our project was one of two in the united states And we were able to kick off the series back in september of 2022 And it really created I think a lot of momentum and understanding Of our project and our challenges here And then of course, I think what makes you know us a unique community in terms of Really trying to involve You know others is the community input So we have on several occasions over the years gone out to ensure that we are Working on initiatives that reflect the community's interest Um specifically right here the three take home messages that I want to highlight is nine out of ten of our customers are Are in support of investment in infrastructure About nine out of ten really want us to take action now recognizing the seawater intrusion That's been knocking at the door of our groundwater basin And that three out of four of our customers are comfortable with pure water soquel As we continue to educate go out to the community and let them know that the treatment process Includes, you know, multi-step micro filtration reverse osmosis And then uv and advanced oxidation that that purified recycled water Then goes back into the ground to create the multi benefits of a seawater intrusion barrier as well as groundwater replenishment As I mentioned previously, you know, we do always try to ensure that we're engaged Public and and the input and so just wanting to highlight here These are just kind of a snippet of things that are available And this is just a small set of the tools that we use But we do do a monthly e-blast that goes out to nearly 15 000 readers We maintain a pretty robust website that's available 24 hours a day seven days a week That has a plethora of information We issue news releases on our website as well as out to the media outlets We attend a lot of community events and of course we've been doing quite a few tours Not only is that outreach and engagement just on everything district-wide We also have built that into the water rate study that you're going to be hearing more tonight And here as you can see With this water rate study that we're conducting in 2023 An ad hoc advisory committee was created We established this committee in april And they have been very valuable in providing oversight and recommendations The committee is comprised of 10 district customers and two of our board members All who are repairs and they their their goal and objective is to review the water rate structures Understand the revenue needs and what kinds of programs and projects that we have In the next four years and and even out farther than that And really it's to provide ideas feedback and recommendations to reflect Our customer base it was a very diverse group you can see on the picture on the right That was just one of the many meetings that we've conducted over the sixth month process And then of course, we're also conducting these public meetings here tonight As we continue to discuss this at board meetings Oh, yeah And in fact, we do have a committee member here tonight. It goes right there. Thank you for your participation Okay, I think with that I'm going to turn it over to either leslie or kevin I think you have me I just heard from kevin caustic with raff tell us and he's engaged on another presentation this evening So I'll go ahead and cover his slides for him And melanie, thank you for for that introduction. I think it's important for us to Tell that water story over and over again Because our challenges And the steps we're taking to resolve them feed right into our rate study So tonight we're going to take a look real quick at where we've been on the rate study The alternatives that we're looking at that you asked us to model and bring back to this meeting And the impact that might have on customer bills And then what our schedule is in the next steps for the remainder of the rate study period So we just to recap quickly. We started this process back in april At that time the board did indicate that they had some priorities when setting rates Obviously financial sustainability. We do need to make sure that the district is able to cover The cost of service we are a not-for-profit entity So the cost of service does equal our revenue need And it's important for us to maintain Our district operations and to make sure that we're meeting our reserve requirements and our debt coverage requirements to to remain Sustainable with our our debt covenants and the borrowing that we've done to date In addition to financial sustainability, obviously legal defensibility is important And then as well probably the most important maybe is social equitability We want to make sure that Under the auspices of prop 218 that we are treating all of our customer classes equally And that the rates are allocated among them in an equitable manner So we brought the financial plan back to the board. Um, I believe that was the october meeting. We brought that We had an estimate of that time of probably a 12 percent overall Annual rate increase or not rate increase but revenue increase year over year for a four-year rate study So that has kind of fed into the rates and where we are right now There were some other options available Under the finance plan and recovering that revenue one of them was like a huge bump up In year one and then tapering off to about seven and a half percent In years three or two three four, but I think we've decided or settled on, you know, roughly the 12 percent Revenue recovery is what we're looking at Under the cost of service analysis We have modeled a variety of different structures. We've looked at a uniform rate structure We've looked at our existing tiered rate structure We've taken a look at our cost allocations in the Environment that we're setting rates in now And so there is a modified two-tier structure and then ultimately the three-tier structure that we're You know the two that we're looking at this evening We have hurt the board's concerns We're trying to respond to some of the concerns you've expressed. We've heard the public's concerns So we have modeled some different options for you this evening But as I stated earlier that needle is not moving a whole lot the legal environment in which we're Setting our rates Is a fairly narrow? narrow avenue to navigate Um, so the rate structure modifications We're bringing to you this evening are the revised two-tier and the three-tier option for residential customers Assuming a 12 percent annual revenue increase And then we have modeled the fixed revenue recovery At 40 percent 50 percent and 60 percent of revenue recovery So let's take a look now at what that means um, so On the supply side there are two different Two different components to our supply costs and one of those components is just overall basin sustainability Which benefits all of our customers? Regardless of how much water is used and then there is the supplemental supply component that may be um More beneficial to higher water users than the lower water users so We've taken a look and kind of divided the supply costs accordingly The impacts between the Two-tier and the three-tier are very similar at the same level of use So if you're using two units five units nine units a month, they're they're very similar in terms of what those tier options look like The impact across the the rates Are driven by the modification of the residential rate structure um, and then the Higher or lower fixed cost recovery has an effect on that bill impact as well And so we'll take a look at what that looks like For each of those Each of those options the modified two-tier and the three-tier So as I said, we're going to take a look at the revised or the modified two-tier rate structure and an alternate three-tier rate structure And we're looking to look at a revenue recovery on the fixed service charge of 40 50 and 60 percent And as I said before all of these rates that we're showing you here this evening assume a 12 increase in revenue So this is taking a look at the modified two-tier This is the volumetric rates And you can see in the first column you can see what those rates are currently Customers are paying $9 and 10 cents up to six units of water And then anything over six units of water is being billed at $41 and 23 cents Our commercial and irrigation rates are a weighted average of the tiered rates for residential and those are coming in at 15 25 unit So if we take a look at The three scenarios that we modeled one of them was 40 fixed service charge the remaining 60 of revenue coming from the volumetric charge 50 50 Or 60 on the fixed service charge and recovering 40 on the volumetric charge You can see that the impact that that has in terms of rates So you're looking at a range of about $14 for tier one all the way over to $9 for tier one 20 all the way down to 1469 and then of course your commercial and irrigation rates Um Because we're covering some of the peaking costs now in our rate in our rate on our volumetric side of the rates You are seeing some peaking differences between commercial and irrigation So commercials coming in anywhere from 17 to 12 and Irrigation about 19 20 dollars down to 12 96 now the reason for that As you collect more revenue on that fixed service charge Your volumetric per unit water use rates go down But that has a different impact on customer bills. So let's take a look Oh, no, we're gonna take a look at the three tier So you can see on the three tier. It's very similar We're looking at a tier one from uh, zero to four units four to eight units in tier two and anything over eight units in tier three and you can look at the proposed rates under a 40 50 percent or 60 fixed and you can see that They're very similar to what you saw under the modified two tier. There's not a whole lot of difference there It is giving our customers a little more water use Uh available to them at the lower tiers before they hit that upper tier Um that upper tier is where you see the conservation costs and that kind of things start to kick in So let's go ahead and go to the next slide here. This is where we're really going to take a look. Oh, these are the fixed charges Um, you can tell these aren't my slides. I'm following Kevin slides So this is the fixed charge if we were to recover 40 50 percent or 60 percent of revenue from the fixed charge 90 95 98 percent of our customers are on a five eighths inch meter We're moving more and more customers off the three quarter inch meter. So that one's going to be phased out One inch meter. We have very few residential customers utilizing a one inch meter And I don't think we have any residential customers utilizing anything more than a one inch the larger meter sizes are mostly for commercial and irrigation customers So you can see how that fixed service charge increases Depending on whether you're trying to get 40 of your revenue need on the fixed charge Or if you're trying to get 60 of your revenue need on the fixed charge. So that increases The more you're trying to recover on the fixed charge But it also means that our customers don't have as much flexibility in Managing their bill through their water use because more of that charge is fixed So let's go ahead and take a look at the next slide. So now we're going to go ahead and take a look at some bill impacts So if you were a household using two units of water a month Which equates roughly to one person Um, given our standard water use of about 55 gallons per person per day Our current bills running about 70 dollars for two units a month under the 40 percent That bill would go to 83 50 percent it would go to 90 34 And for 60 percent it would go to 100 Dollars and 56 cents. So you can see the difference there I mean you're running all the way from, you know, about 12 13 dollars increase a month all the way up to 30 dollar increase a month So that fixed component does have a significant impact on The bills for low water users On the three tier you're seeing very much the same thing You can see the bill impacts are very close to what is shown on the two tier running roughly 82 to to 100 As a matter of fact you get to 60 fixed in tier three and you're exactly where you are on 60 fixed for For the other or i'm sorry i'm not tier three, but For the bill So you can see those bill impacts mirror each other very closely There's not a whole lot of difference between the two different rate structures But there is a huge difference between 40 50 and 60 fixed Now if we go to the next slide the next slide's going to model it for a household that uses about five units a month and you can see that There again It does have an impact but not as great an impact as it would on the low water user at two units a month More the revenue is being recovered from the fixed service charge at 60 fixed There's not a whole lot of movement between 40 50 and 60 fixed At the five unit a month consumption level But then if you hop up to nine units a month, which is the next slide You can see that The impact is actually reversed Or somebody using nine units a month the bill actually goes down slightly and that's because of the change in the tier grades And the cost recovery On the tiered rate side A lot of that has to do with recovering costs on basin sustainability Assuming a basin wide benefit now that we're bringing the pure water Pure water silk hill project online everybody's going to benefit from a sustainable basin Whereas before The startup costs were primarily In tier three So that's why you're seeing the change mainly at the higher tier levels in terms of water water bill savings And again between The modified two tier and the three tier there's not a whole lot of difference in the bill But there is a little bit of difference on the on the fixed service charge for the larger customer or the larger water use customer the 60 fixed is a much greater savings to them than the 40 fixed Or the opposite was true on the low water user it was a much higher Impact for them on the 60 fixed and a lower impact to them on the 40 fixed Leslie if I may chime in at the last thank you At the last meeting we had a member or two of the public that were concerned about their family size and the bill impact And I don't want to go into specifics I didn't use this much water But we went back and we worked with them when we analyzed them based on what we were looking at last time The board was and they would actually that this the rate structure being the rate structure is being considered at that time Would actually benefit them over the year so they'd be saving money and you know, they were talking about their Situation so I just wanted to kind of tie Back to how it actually Reflects in our community. Thank you Thank you And so let's go ahead and go on to the next slide So this is just exactly what you saw on the previous slide The previous three slides you're seeing a comparison of the monthly bill impacts side by side now For a two unit five unit and nine unit household At the 40 50 and 60 percent level so you can see where It's more beneficial to a lower water user to have a lower fixed service charge and it's more beneficial to a high water user to have a higher fixed service charge There again the difference between the revised two-tier model and the three-tier model is Not much. They're very similar. Let's go ahead and go to the next slide And so this just kind of breaks it down A little bit the same things we've been looking at In terms of the impact of the bill On the customer for the 40 50 and 60 fixed service charge This is broken down into dollars per day And it also extrapolates out over the full four years so that you can see Because of the rate structure modifications that we're discussing now in year one That impact is greater in year one than it is in subsequent years in subsequent years that Increase in the water bill is not as significant as it is typically in year one Oh, this is the five and this is the same slide. We just looked at for the two unit household This is the five unit household And you again can see the impact per day. We're looking at about a dollar per day Impact and that decreases as you go out over time because that first year is impacted by the structural changes to the rates The subsequent years are just impacted by the increase in revenue need And here we are for the nine unit customer Their bill is going to go down the first year because of those structural changes But then in subsequent years it would go up Relative to that first year it would go up by the annual revenue Need increase in revenue need And so those are the Models that we're presenting this evening Both of those or all of those residential rate alternatives Differentiate between base and white sustainability in terms of what supply costs are allocated to base and white sustainability Allocated to just supplemental supply This looks like it's the same slide we looked at earlier Impacts between the revised two-tier and three-tier options are very similar We saw that throughout all three of those options and at all three levels of use that those two-tier and three-tier options are virtually identical And then the impact across the users again are driven This first year in particular The modification of the residential rate structure is impacting that first year of rates And then over the course of the rate study, of course that would settle down and that increase would only then be 12% The lower your fixed revenue recovery The lower the impact to low water users the higher your fixed revenue recovery the higher the impact to low water users and vice versa for high water users Well, I the committee didn't have an opportunity to see this model But I think the committee's recommendations had been either the two-tier or three-tier options and their recommendation had been the 50-50 cost recovery Which I think is what we presented to you at the november 20th meeting. That's what that's what I recall. Yeah And then Just to give you an idea of where we are in the rate study Process we are here at the tuesday december 5th meeting. We've brought you these rate alternatives We've got another meeting on tuesday december 19th where we hope to be able to have raftella spring a draft rate report to you The intent is to go ahead then once that rate report is Formalized and approved by the board we can go ahead then with noticing our customers with a proposition 218 mailer And then we anticipate having an open house and a public or an open house actually and a webinar Before we have our public hearing 45 days after the mailer goes out You're welcome. And I just to just to recap your your board actions tonight would be to provide us with direction Regarding these structures that we presented this evening Give us an idea of which ones you'd like to see brought back to you in the draft rate report or You can take no action View of what happened at the last meeting have board members ask any technical Would have the board have a hard time picking it up some technical questions and then really then open it up to the Are there any questions? so one of them It doesn't seem like there's a whole lot of difference between The effect on the rate, you know rate pairs on The two-chair or three-chair. I mean they're very similar at various levels But I didn't know if if there was any other information that would help us to make a decision on those that might be helpful That's one thing Secondly, you know, I had asked if there was any possible Way to save money so we didn't have to increase it quite as much and I didn't know if you'd looked at that and then just Those are my two questions and then I just wanted to just say that There none of us Want rates to go up And But we we have a commitment all of us to providing you know, high quality water and and we have a commitment to saving the basin and and providing good quality water for years to come and I just wish that wasn't expensive and I think we've done a good job of trying to Get grant money and all that but I just I mean I feel like we have a great staff and I want it seems like a lot of the costs for keeping everything running are to for our staff and and I feel like they all want to have a good place to work and be able to keep up with inflation and Have a you know I feel like we provide a good place to work and that we want to attract and keep people that care about water and I feel like it's a good place to stay for a career I think it's a more effective organization. So a lot of reasons that You know, even though we wish we didn't have to it just I think we we have to take care of our basin our customers and our employees I just wanted to respond to your first question. Yeah Well in the as far as I'm concerned I was looking at the two rate structures are different in A way that's hard to show But somebody that uses let's say a low amount of water And then they have company or they end up with an extra kid in the house And maybe they were below the threshold for the first thing with the three three rates Structure they're not hit so hard for that It's a lot like oh this kid came to stay with me and all of a sudden it's a hundred dollars more For my toilet leaked and now I'm paying 250 dollars when I usually play 70 which actually happened to me so So I have you know, I have a feel for people That are at that point and that's why we looked at the three rates That's what it was for other and the comparisons aren't as as good because of the spread of usage I mean at the lower end it's not going to be that much different but at the higher end it is Of that range. Yeah In that middle range. Anyway, that's all I had to say Yeah, we heard after their last rate meeting We heard a lot of comment from larger families about how difficult it was to keep their water rates down and the committee Heard that commentary the rate committee and responded Responded with a preference for the three tier because it would be a softer landing when even any of these are Taking care of one of the big worries I had is before they would go from you know Single digits up to $40 a unit, you know suddenly so they're way better as far as being equitable for Families of various sizes Yeah, just one no need um There's an inconsistency On page 42 of 58 and I think I've talked with you about this before Ron and forgive me The five eighth inch and the three quarter inch meter costs Are the same Even though there's and I think the response last time there's not a lot of them and we're phasing them out The the three quarter inch meters are older meters and we are in the process of phasing them out But the new ultrasonic five eighths inch meter has a flow rate very similar to the old three quarter inch meter and that's why they're being handled the same It's it's it's all to do with flow rate and So if I understand this correctly there's you're apportioning the same ability of the basin And There's also Flow peaking as part of this as well on setting the rates Correct. We are capturing some of the peaking on the volumetric side Which is why you're seeing a difference between the irrigation customer and the commercial customer And then the supply costs are being allocated across all users because there is a basin wide benefit to all users Who take water from the basin are receiving the benefit of a sustainable water source of a sustainable basin Director lehu, I believe you had a question that Ron was going to answer Yeah, I mean we can get into that if you like right now or did you in here? Okay. Yeah, well, I'll just I'd like to start out with um before I just jump into cost savings Uh Nobody likes rate increases nobody everybody, you know, nobody. Yeah, I I don't think there's a person out there Whether whatever bill it is But to supply high quality water 24 7 and defend off seawater intrusion is um It's not inexpensive to do that and that's what we're faced with and you'll see that other agencies Are are facing the same thing even grover city I believe grover beach 20 rate increases. I've seen some 50 So there's this precipice that you can see being hit in the water industry Whether you're an agency that didn't keep up with your infrastructure and your parents put that in and you're having to pay that bill Fortunately the district saw that coming and it's been doing that because we knew we had a seawater intrusion. So I just want to say There's no easy way out It's expensive, but the alternative is even worse, right seawater intrusion cost more use less With cost saving measures, you know, as the board knows we come to you every year with um What we call an efficiency memo Outlining items. It's just built into our system. So what do we What can't where can we save? What can we do? And I jotted it down I had somebody jot down So I can name a few of what we've done. I know you're looking forward to going to the future But I think if I was sitting out there in the crowd, I'd like to know You know, what if there's two things right getting money and conserving money There's actually a third i'll touch on but for the sake of the audience, you know We the this We've done some big things and I can talk about those at the end But I think the small things give you the best reflection of who we are And so I'm gonna call off a couple of those We outsourced we just recently outsourced daily deposits to a lot box allowing for a halftime reduction in a billing position So a halftime FTE. Thank you, Leslie. We changed our merchant processing for credit cards that Saves us money. We refinanced our certificates of participation in 2020 that saved about seven million dollar Customers money over the life of that We have prepaid certain things down like OPEB and PERS which leslie may like to talk about tonight, but that is like prepaying your house payment and Yeah, everybody takes a little bit hit now, but in the long run We I think we estimated about 50 grand a year or something around that by doing that maybe more so these are the things we do we we We get a list together of the software and stuff that everybody needs and updates And then we don't buy it. We wait until like a black friday. We have somebody who watches that and it was just Just done. I think recently I saw hey Your stuff will be coming because We can get a deal One thing that I'm very excited and proud about that I've never seen really done and I think we've transferred this to many agencies Um And organizations that I'm involved with uh what leslie brought to the table When you're a public agency and by our policy, you're not really allowed to invest in very risky stuff We have to keep your money very safe, right? That's just The the land of a public agency um However, and so interest rates have been so low That there was nothing or we would be getting about 0.2 percent or something like that I think in length and then we saw interest rates climb up to like five six seven percent And and discount rates and so we started taking Your money and put it in cds federally insured through different banks up to 250 k So if the bank fails you get your money back at I don't know five percent on average Yeah, we're getting about five percent. So I mean When I shared that with other agencies and a couple Organizations, I'm involved with they started doing the same because you get locked into we can't make any money But so that that was another big one I could I could go on for that the other of course mega one is not a cost savings, but We have actually stayed up all night running flying driving in cars uh Many other episodes to when you Uh grant and low interest loans So the grant funding is close to a hundred million dollars. I don't think I've ever seen an agency our size You know, we're a small agency, but we've got a big problem. That's that's how we're recognized from the outside to garner such Funding and it's not just the funding, you know 65 million roughly from the state water board 30 million recently from the bureau of reclamation But the bureau of reclamation controls half the water in the west They are the premier water federal water entity the state water board is the premier California water agency and they're investing and in your money and then we got an EPA loan The loan is like 1.6 1.3 so they the delta If you had to go out on the street and get a loan that's millions of dollars itself So there's many things we have done We went back and looked at it and we made a list of things that we could do That I don't think we're gonna make it in time for this rate structure. So I'm moving from the past to the future or but things like somebody brought up a property potentially we own two really Probably semi valuable properties the glenwood property, although it's not it's a hundred acres. It's so steep It's not valued that highly and then of course the property next to our agency, which is probably worth a couple million We Have to evaluate as we go work with our neighbors through an optimization study, which is a 7.6 million dollar another grant We got to see if there's any benefit to them or us And whether we need that property and other properties. So that's that kind of thing is going to be a ways out We looked at a host of things And I don't I'm not going to bore you with the list But all the way down to there's this thing called harvest host where if you have a a little rv You can park on a public entities property overnight and you just park and go the next morning But you slip like 20 25 bucks in the in the slot or whatever The point of that is that money could be used for others that need it It's not tied up to whatever but we're we're exhausting everything cell phone towers allowing that was another idea But the the bottom line is of all those ideas. We don't think there's anything that could be If it was to be acted upon, you know, even Building places to rent, you know, that was another thought but it could be done in the timeframe for this rate Study however, however, we do have possibly one Option available available to the board. We did go back and look at as ron indicated one of our cost-saving measures is to pay down that unfunded pension and other post employment benefit liability that we have on our books By paying that down Earlier rather than later. We saved the district a ton of money in avoided interest costs however We have the ability this year if you are interested in taking the money that we would have set aside for pre funding and not spending it on pre funding That would be available to reduce the revenue need in year one to help offset That impact of the the structural changes on our customers If you were so interested If we were to do that it would probably drop the Revenue need in year one from 12 percent down to about 10 percent I wouldn't recommend doing it every year simply because it is a cost-saving measure, but I think if we did it one year to help Help our customers with that structural change That that might be an option available to you then what would be the Estimated savings that we would be foregoing on In year one because of the Interest rate environment that we're in right now I don't think we'd see that big of an impact because we are getting a better return on the The money that's set aside for unfunded liabilities We are getting a better return on it right now than we have in years past So if we were back in the ages of two percent Uh Interest I would maybe not suggest it But right now the earnings on that are sufficient that I think it would float us for a year We wouldn't have to make those payments so I just want to sometimes It slips out that we're talking about a rate increase We're really not there is A change in the rate structure But the real increases in the revenue that's needed correct And Our task here is to come up with the rate structure That is fair It's fair as possible for the needed revenue increase Right, okay Let me ask we just got word from back there that they're having a hard time picking up some of the board members So if you would be like I'm usually too loud. Yeah. Yeah For all of you though, we just got noticed. So what was your question director? My question was that the next Hearing that we're doing or the next meeting is when we talk about what the rates are going to be um That is when the Draft report would come to you and would show you exactly what those rates are going to be now I've shown you this evening what the rates would be Under the 40 50 or 60 scenarios Assuming 12 increase assuming a 12 increase now I can tell you that if we were to enact a 10 percent increase in revenue this year rather than 12 percent because we would be Not doing the pre-funding On a on a two-unit bill The impact instead of being like 19 dollars A month 1972 a month it would be down to about 1815 So it saves it saves them it saves them a little over a dollar a month on a five-unit bill that impact is closer to 250 a month So it's not huge You know when you take when you take something like that and you extrapolate it out over 14 000 customers The impact of it gets diluted. It's hard. It's hard to move that needle Um, I think we've shown that a little bit by coming back to the board Uh a couple of times now with some rate alternatives and You can see that that needle hasn't moved much each time but a little bit every time is You know every little bit helps I'm sure Well, it's a far cry that figures out Grover beach and they're asking for a having to impose a 24 percent increase the first year of their rate study because they don't have Haven't been able to get the funding that we did for the For the projects they needed to do to prevent seawater intrusion. This is a place down south and I also heard from um Honolulu, Hawaii They're imposing a 63 rate increase over five and a half years because of the same reason they're Uh all over the world the options for Uh Finding new water sources are getting harder and harder. It's not merely a digging a well It's coming up with a complicated project to prevent seawater intrusion in 70 percent of the world's coastal areas are at risk at the moment for uh Contamination due to seawater intrusion. So this is an immense problem worldwide and the project is designed to It's available to solve that problem are limited and expensive so we are really uh By jumping in and moving as quickly and decisively as we did in the past eight years We have come to this where we are not talking about a 24 percent increase. We were talking about 12 and maybe 10 percent. I'd like to hear from the public at this point to uh they Well, if you've understood what's going on and if you don't your questions and if you do your comments on it and your reaction so Hi, chris curby So we didn't get financials for four months and we've got them last month and we haven't gotten we didn't get any more Today and i've heard leslie say that we're having 11 or the water district has an 11 million dollar shortfall Where does it show that where are the financials? it's like You're just trying to do this increase, but where does it make sense financially for us to see that That's a fair question I mean, she just just doesn't give us financials every month. I don't understand that isn't that her job her responsibility Shouldn't we see that? I saw those financials Like we can't hear you not status reports were presented to the board last meeting but that was A month ago. So is there an 11 million dollar shortfall? Miss curby, please please not in one year. It's over a span of three years Miss curby, please I would suggest you use your time and then we can if the board so chooses so that's a no answer It's also confusing to people the two to three tiers where it goes from six to four And nobody really talks about that so you're getting less water I don't know it's kind of unclear, but And I would also like to know the pure water so cal can you guys guarantee the The cleanliness of it and that the that it's pure for us to drink I'd like to know if it's if if there is a guarantee of that It's state law requires It would just be nice for somebody for you guys to say we guarantee that it's it's Good clean water because it scares most of the people out there your numbers on that chart Are not what I when I talk to people we sit out places and talk to people about it And then people are freaked out about it So it would be nice to see the financials where this really is a needed thing Um, can I just address a couple things? Yeah, yeah So on the question about the difference between the the two tier and three tier It's just a number it's the amount of water used so there's a certain price for the first four units And then another tier for the four four through eight And then above eight the two tier has the break point at six So there's a price for zero to six and then the second tier is six or above So that's the difference there And as far as I'll just make a comment on water quality We've said it before but you know, we went through a long process to make sure that it would be safe for people and Had experts from toxicology the water industry, you know I feel very comfortable That the technology is safe. It's been used In orange counting for 40 years and it keeps you know, so I'm there are fail safes to to protect us all That no water that's contaminated would go into our groundwater. So I feel comfortable, but I mean it wasn't initially We all had to have it proven to us. So Nicole Malcolm So the tier levels I don't really understand what's behind the choices for the tiers or any of the particulars to understand the final result But what's curious to me is And I sympathize with the gal with the large family and the higher water bill Um, because that's a reality for people who use more water than other people who don't whether it's by family irrigation larger property whatever the situation is Especially for a large family So I'm wondering um since we're supposed to be saving water and the focus is to Manage towards reduced use of water Why more water usage would actually be less costly is a question to me So that I'm just going to put that out there And then secondly something popped into my head after the last meeting we attended And I encourage you to kind of think about it seems like there's a lot of collaboration with ucsc And they are here in in our area I'd like to see you maybe start talking about maybe a scholarship or something and have the ucsc participate In one of their environmental type classes you were talking about wanting to get young people involved Have them go to it and present to you their different program Plans And have a scholarship for a winner of the plan that really is a viable plan Maybe you'll get some other ideas You know and it would be a really positive way to involve the university and the kids And I think really a useful focus So just an idea Thank you. Yeah, sorry, um, but your question about the tiers again There's still if someone uses more water and goes into the next tier it's still costing them more per unit of water Still costing more per gallon of water But it's costing them more for you So you're going to be better off and still got a conservation incentive It's cheaper to use less water So they're not going to be able to hear you because you're not up at the mic So I just want to let you be picked up. Yeah So I can I can definitely if the board would like, uh, I think those were thoughtful questions And I'll start with the big question that the the tier structure and why Does it isn't geared toward helping larger families, but might uh, it's higher cost to the to the lower users and In the past we saw that We didn't know if we were going to a supplemental supply pure water. So Cal was going to come online So we said anybody who's using above the sustainable amount Could be contributing to further overdraft over the sustainable amount So that was where the majority of the cost lied before we knew whether we would actually have the plant come to fruition Which is about 80 90 done now now. We see That it will be producing water To the benefit of not just higher users but to the sustainability of the basin to fight seawater intrusion In mind you the seawater intrusion started back in the 80s So it's not just by high users. It's by everybody So the idea is that As the plant comes on it's not just to the benefit of the high users Whether it's a large family as you said large lawn you are you you everything you said was spot on But it's it's to the benefit of everybody to protect that supply It doesn't matter whether you're a low user high user. You've switched over time or we'll switch again That seawater Barrier that we're presenting the hydraulic barrier will protect our water supply whereas I said so many have failed I don't know if you were here for the first part The most seven the vast majority of regions of the world have failed at doing this And we have this moment in time due to technology doing being positioned So that's the shift fundamentally. Does that help so not I mean does that kind of Okay, okay, if you'd like to um contact us later after the meeting maybe we could delve into Yeah, I'd be glad to give you my card and then then a couple other questions were ucsc We have engaged ucsc quite a bit. They did an economic study. I think was presented. Did you see I don't know if you saw that but it Okay, okay, and then we then we worked with Dr. Fisher Who helped us see if there was any places to do recharge in the basin? So that was quite an exact extensive study um I also occasionally teach it up there. They asked me to come present on water and we have uh I think I don't know if we've had an intern from up there or not. I think maybe harbour high and some other schools um, but to tell you the truth we typically focus on cabrillo college and then and and santa cruz kind of Takes ucsc for the most part, but we have a lot of collaboration with cabrillo So I tried to take notes. I hope that's of some help anyway I'd like to comment also Just to reiterate there's a really a a paradigm shift here going on in terms of the rate structure And the that shift is like ron talked about the fact that we are close to having The supplemental water supply online Which will be recharged and injected into the The low parts of the basin the low the parts of the basin with low water levels to keep seawater the slow or or Stop or reverse seawater intrusion Is Makes a big difference because Before when we were heavily the rate structure was heavily It would the goal part of the goal you have to be fair you have to be legal But part of the goal is We didn't have that supplement or supply so we didn't know Whether we could stop the seawater intrusion and by by people using less water That at very least would slow it down. So it's a real paradigm shift It would be great if we were doing this a year or two from now after pure water sokel was online And we were able to see what the effects of the recharged and injection are that that it's working but Not how it happens. We had we have to do the rates now And I'll just add you know, it is hard to understand. It's a lot of information And you know, these are business meetings. They're presented to the board, but we do try to break it down but that's even the the real reason why we have a advisory committee I think 10 10 community members volunteered for that and stuck it out one of them's here tonight for Since april meeting a couple, you know, several many numerous times to help digest it and put forth a recommendation And and that's what's in front of the board tonight So not everybody has to do that the heavy lift and to ensure that you know Their input is being captured and and conveying hopefully can't mean vain the the majority of the thoughts of the of the community Digesting that so not everybody has to do the heavy Lift because it's tough. I think you have one more member. It looks like president christensen. There might be more Yes, hi, my name is trink praxel and I live in the seascape area I've been to some of the meetings in the past, but um, I wanted to I knew looking at a rate structure is always very challenging very difficult and I wanted to present the voice of many of Your users who understand the drastic situation that we have been in And really support this so I'm in the project and the everything that the board and the staff have done to receive additional funding and support that and I people I talk to really understand that and Support this, you know, what you're doing And I just know that often you only hear the negative side And I thought it was important to come tonight and tell you that there's a positive perspective out there as well And I think as you go through the next couple of months with the workshops and hearings, etc I hope that you'll hear more of that As many of you said nobody likes a rate increase But when you can explain the rate structure changes, which you know I understand what you're talking about and that makes a lot of sense I'm glad to see the consideration of that three level and of being able to Reduce that high increase that happens right now in the second level. I think that's really going to help many people It's still going to be a little bit more money, but it won't be as much as it could have been You know with it seems to be with this a two-rate. So the two level So hang in there keep going and I think you'll find the support for it out there. Thanks Thank you So at the last meeting I brought up the possibility of Tax somehow For people moving into the district To offset the cost So that we can kind of take the Onus off the people that live here There's all this mandated growth by the state. It's kind of interesting that we see mandated growth requests Yet they're acknowledged that the water is a problem so You know, we're expecting that energy costs are going to go up electricity And water and that's it's just going to be too much for People who are fixed income So is there a way to do this and I talked to Ron about this after the last meeting And he said he would talk to legal about whether there was a way to do that because of proposition 218 So I read through 218 and it seems like there is A pathway to make something like that happen. It would take two-thirds vote from the residents To institute some sort of fee for incoming people into the district And if we could figure out like the number of people coming in and how that might Change the numbers a little bit that we could then in the future reduce the The increases also Part of the problem is people's being able to people being able to afford this So there's all this talk about ad us Uh, which if people can afford them and there's ways for them to do that That would supplement their income and allow them to afford The hookup fees in this district are Outrageous So it makes it hard for people to even consider it. So That's something I'd like to see if it could actually decrease that I know that's kind of moving in the wrong direction, but at the same time it might Produce some ability for people to afford the future Thank you. Thank you. You want to reset the timer? I've only got three seconds. I can't talk that fast um back a steinbrunner It's too bad that ref tell us who's being paid 161 thousand dollars can't be here to answer some of these questions I'm glad to see mr. Nelson here because to be legally defensible Your rate increase has to show a need. We haven't seen any figures We've only heard a verbal comment from the director of finance That we're here because of an 11 million dollar shortfall. We have seen no figures We have seen no figures in Terms of the different rate Rate increase the different structuring the different percentage of fixed income We have seen no figures to show What is a 12 percent revenue increase? What is that dollar amount and why do you need that amount? It has to be legally defensible And it's not in the way that's being presented It's given in vague terms that we are expected to accept without any documentation at all What is the cost per unit of the pure water so cal water? I asked that before it wasn't answered and that must be determined because that's what you're asking people to pay You're asking people you're calling it a sustainability A fee but it is to pay for the pure water so cal project and the debt that has come with it Well, we may have a salt water intrusion problem your your board and your staff have chosen The most expensive way to address it Um It is concerning to me that the director of finance keeps saying this is not moving the needle much So what is happening here? We have no figures to help us understand what that is about Please put into Writing and figures what costs are being cut Um giving someone a 1600 a month bonus um Thousand dollar a month bonus dine a runer. It's it's please be respectful You've answered other people's questions. Please be respectful. You're going to answer mine What sets mine apart from the other people please be respectful of your right and then in closing I'm just going to say on slide nine where it compares the three-tier volumetric rates That's not fair because the new tier two extends into um Straddles the all-tier one and old tier two. So those Values are not fair and not correct. Thank you very people been trying to help you understand that but Um, it's not it's not fair and I don't believe it's legally defensible Thank you for your comments I really appreciate you guys putting out the 40 50 percent and 60 percent out there I don't know how the others feel but after I looked at them all I'm back where we started at 50 percent being kind of a good Middle ground. I don't know how the others are. I agree And you're given three choices the middle is usually the choice but it also looks reasonable and three tier rather than two to Give our customers more control over their water bill I don't know what the other directors think but I want first of all, I want to thank the public for being here and for and for talking I know that it It feels like you're not being heard, but you are being heard So I want to let you know that We can we can reary president christensen if you like what we're asking the board to do tonight since we don't have the motion up in front Thank you. I think it's staff direction. Okay. I'm back with right That's craig. No motion is required. It's an option. We could just do staff direction if that's the preference of the board Jennifer has something Yeah, I just wanted to say that we're obviously tasked with a very difficult decision And as directors were guided by our principles and in this case we have to follow fairness social equity legal defensibility and fiscal responsibility as our guiding principles And it seems to me that the three tiered structure does encourage and reward conservation Allows for individuals to take responsibility for their household water use offers Financial incentives for people to use water efficiently and promotes environmental stewardship I do think though that you know to really Find and honor the fiscal responsibility that the 60 fixed rate service charge ensures a stable source of revenue Promoting fiscal responsibility for the water district And the steady income helps cover operational costs and maintenance reducing reliance solely on variable water consumption And the stability will contribute to long-term financial planning and infrastructure investment Um and then further I just think that what leslie had proposed today should be followed up on So that's my staff direction. I mean, I do think that um It sounded like an idea to not do the pre-funding and to bring that first year down to 10 percent I mean, I really like that. I know you said it doesn't change the needle much, but small things really matter Um, so that's my input and thank you Any other comments I think I made most of mine earlier I'm I'm all for the three here. I have been Or through the process I decided that was the best way to go for people especially because it did Touch my heart that people with more kids. They may be using 25 I don't know 25 gallons a day per person, but they just have too many people so they end up being hugely Um Hurt financially by it when they're all of us are maybe using 20 25 in per person and You know, we're under that Needle where the four 100 cubic feet, you know ends and For the five and it goes to the next level So, um, that was my reason and it seems like 40 50 60 percent Um Doesn't add that much to any individual person Or individual household. So, um, I'm not sure if You shouldn't go to 60. I mean, I'll I'll go with whatever You know, I'm not going to get mad if somebody's not agreeing with me on that one, but um and you know There's a point where you know, we can there's a lot of Like back and forth stuff about details and You know, we could be out there just wrestling all those details and it'll still end up being the same It's not um, it's not an easy subject and um Little tiny details here and there about You know $100 here $1,600 there isn't going to make a difference Just like two million dollars costs our our rate payers what? $200 each or a thousand, you know, I mean it's you know, how do we reduce our costs? Maybe we should look at reducing our costs for um legal actions so just um Just to clarify the options being presented to you this evening, um Um Wood lower bills for larger households because they are hitting that High upper tier that tier two rate at $40 a unit so It would it would help smooth that a little bit for some of your larger households but I do want to point out that um We I have received notification from the state and I know senator padilla is working on this but Um, they are looking at making the low income household water assistance program We call it the lie wop, but it's similar to the lie heap for energy They're talking about making that permanent and of course the district will participate. We are participating now Um, it's something you have to enroll in as an agency The moment they made it available the district enrolled and we have made it available to our customers If they make it permanent then that will help some low income households We continue to outreach that whenever we can we continue to talk to customers on the phone Um to try and make them aware of that program The other thing is I know that there is an extension of the coveta re-reach program that we're looking into that might Uh benefit some of our customers as well So we are looking at every avenue available to us to help those customers who might be struggling a little bit So I have some things I'd like to see for next meeting Okay I I think this is digestible Going to five and nine Let's make a curve Let's let's have all water uses And see what the difference is It seems like 40 fixed Is off the table 15 60 fixed Or on the table, you know been Been talked about So maybe you had a continuous curve with water use and You could do it and you know under the cubic feet And the difference between the current bill and The proposed bill Okay, just just to clarify in order for us to stay on track for a february 20th public hearing We do need to bring the draft rate report to the board of the december 19th hearing We can still bring that information but we hope information but but that would that would need to include either The modified two tier or the three tier whichever the board decides upon And one of the 40 50 or 60 percent the three tier is That's what I've heard I mean if I I guess it just to make it really clear I'm gonna just make a motion And then we can see that we Have him bring back the three tiers And and I'm proposing 50 and I've seen it over the years slowly get more and more and I think this is a gradual increase Okay Okay, but I can still we can leave the motion discuss and that we also instant, you know also Use the savings as she talked about for delaying the the Payments to the pension plan so that that can be it only a 10 increase So that's I'm just putting it out there 50 three tier and utilizing that 10 percent first year and then Keep discussing Look at 60 for next year Next time or whatever it is. Yeah Yeah Oh, I thought I was I we could look at 60 percent for a future Rate study Well, the reason I'm not letting go of the 60 necessarily I was part of the group at the rate committee that we agreed on the 50 percent but the uh, we The non mythical nine million 11 million dollars that we Experienced was due to decreased water sales And I think when you look at these, uh, the structures in the past, uh Uh Fixed costs that we charged Charged in the previous rate study. It looked like it was 40 percent Roughly 40 percent. Yes, and I'm worried that 50 percent is just not enough because we We're moving into volatile times According to our climate modeling. I think we We are in uncertain times climate-wise. I Think we need a little bit more stability And I'd like to discuss it further before we give up on it My reasoning is partially just because it hits the Going having going 60 hits the lowest users the most and While I wanted to see things even out. I just Thought maybe it seemed like too much at once for the lowest water users. I think that's a fair argument too These two hcf which is 50 gallons a day You the proposed bill at 60 percent would be 100 dollars and 56 cents 10 dollars less if you do 50 percent So I just I think this is a very simple thing to do to plot up 15 60 percent what what the difference between current rates and proposed rates are And the other piece of information like to see is how many people are in these different classes Because there's a lot of people in that low In the lower class correct and I believe that was In the slides for the november 20th meeting then you you wouldn't have to do any additional work But just I think it's roughly Do you have access to it right now? Oh, we don't have a Yeah Yeah, I believe I believe by the time like 12 000 people By the time you hit five units a month you're covering at least 70 70 percent of our customer base 71 I believe By the time you hit nine units a month eight or nine units a month you're at 90 93 percent I think of our customer base So yeah, but when you're looking at just only two and no, you know, not including other people that used to and above Yeah, that's like 40 ish somewhere around. Yeah, and then Are half of them rentals a lot of the people who are using two units a month or less are People who are using no water right that would be a lot of your second homes and vacation. Yeah That makes a difference to me Yeah, yeah, and we can point out that the higher fixed rate would target those vacant houses too It would make it more socially equitable President christiansen just from a procedural 60 60. Yeah, just from a procedural perspective We do have a motion on the floor So we may wish to see if there's a second and if there isn't then we could move to an alternate Can we repeat the Read here And the two percent fixed and Utilizing the savings that Leslie described for the pension Pre-payment this year so to make the increase only 10 percent the first year Can I go for another motion? I do the exact same as tom except for I'd make it 60 fixed rate I'd second that The board's discretion whether you wish to have a voice vote or a roll call vote before we vote I I just I agree with tom that You know What 60 percent does if you look at the nine? 100 cubic feet a month is it decreases From the current bill by over $50 So what you're doing is you're shifting the burden to the lower users and I'm I'm okay with having it be more No big shifts, you know no step increases for higher use or less step increase but I'm not sure I want to Shift that burden Yeah, 2000 or 70 percent for users Quick comment, maybe all of the low users including myself Haven't been paying our fair share in infrastructure costs and maintenance costs all these years And I'll just elaborate on that in case it Did he say 17 or 70? 70 percent Now dollars It was about $18 It's 82 the difference between the 40 and 60 That proposed I misheard that F2h yet Are you talking about the proposed fixed charge? The difference in the proposed fixed charge from 50 percent to 60 percent is about Looks like about 16 dollars a month more 16 or 17 dollars a month more if it's 60 percent As opposed to 50 percent For the 5 8 inch or 5 8 inch meter, right? And there's an additional increase in the volume charge at the low are used to Yeah combined is a little bit more So I think the uh, what do you need? Do you do for next meeting? You have to have a draft plan. Yeah, I have to so we have to decide between 50 and 60 too good So director lately, I think the clarification on your question was from a slot page 43 of 58 of the packet Where the current bill for a use a household that uses two units of water is currently at 70 dollars in 54 cents For a 50 split the proposed bill would go up to 90 dollars and 34 cents and then 34 cents, right Yeah, oh, I'm sorry the three tier 90 dollars and 26 cents and the 60 fix would go up to 100 dollars and 56 cents So now I know what my bill is gonna be You don't change your usage It wasn't there a motion in a second? Yeah, we haven't had the vote yet. We were trying to have the vote This is this is hard for all of us the clarifications. Um well Yeah, your name Let's go down the list of her not allowed You are so just a clarification if you'd like to do a roll call you can if you'd like to do a voice vote You do it's up it's up to the board. Yeah All in favor Hi, hi Hey Very resounding passes Low voices were nay in the high So we will return at the december 19th meeting with a draft rate report Incorporating the three tier structure and a 60 fixed charge Okay, and and and the reduction in the first year costs of of the pre-funding President christian, it's okay. I just wanted to make a brief comment about the public comment related to defensibility I just want to provide a little context both for the board and also for the public Everything that we have done including tonight is additional transparency beyond what's required So what's required for for prop 218 to prevent to Establish defensibility is that rate study which sort of is the homework that we're doing to justify the rates So everything that that staff has done today to everything the board has directed us to do today Is additional transparency to help the public sort of understand the need for this and also for you to Carefully consider all of your options. So going forward is really when the defensibility piece starts Based on all the work we've done today Thank you So my earlier request is null and void. We've decided Too bad. I didn't suggest 55% Yeah, you could have I'm not I would have gone for the 55 I would have gone for 55 Well, is there any other anything else required of us here tonight? Yeah, there's 7.5, which is Oh, I mean not the next Consider Board board appointments for various standing committee Middies and I think Emma's going to talk to this one. She wrote the memo. So you want to take it away. Emma. Thanks. Yeah, thank you I'd like your idea Well, I also want to apologize that the screen's not working There was a power outage this week in this room and so some of the technology has been acting a little bit funky Um, so item 7.5 presents all of the district standing committees and boards that the directors serve on Just to give context and also to make appointments and reappointments as needed Tonight due to vacancies and term expirations. It's the finance and administrative services committee and the Mga the mid county groundwater agency if you want to make changes to any of the other committees you can And there's also a proposal If the board's interested to come back at the next meeting about consolidating the district street three standing committees Is there a form? Can you explain what how that would look or what your ideas are or? Sure, so we we haven't fully drafted a proposal. We would bring that at the next meeting, but the idea is Combine the current three committees into one or two We'd probably lay out both options for the board to consider And I think we're thinking right now They would meet by monthly and we'd invite all the current public members to serve on either one And our hope is to just have a little bit more efficiency and participation And we think that that might be a good idea moving forward Ron. Is there anything? I think you summed it up I think you heard a comment from the public this morning, you know along the same line saying hey Um, is this an area where you could be a little more efficient? And so we're you know bringing that to the board to To evaluate And and I'll just tell you amongst staff There's various opinions and that's usually a reflection of kind of how the board will think But we'll lay out the options as emma said and see if there's you know if we want to Continue to evolve on that on those committees or keep it kind of the same for the for the board If they want us to to come back the next meeting or you you have the right to to Take action tonight on those if you like You get to the Regarding the should we not act on those that we're thinking about um Consult ahead. Yeah. Yeah, I think part of the Problem I when was the last time we set up those? It was it two years ago, right? I think we probably should renew the process every year because The second year there was a decided tail off Yeah, it's always been designed or I mean, I remember the the direction from the board You know modified as as needed, right? You know, we're evolving So it may need a different committee or may need less or something. So there's nothing I mean that's the beauty of a nimble organization and we should change as as You know the situation dictates. So what I think I'm hearing is come back Mm-hmm except mga Right. Okay. Except the mga. Yeah, you got the computer up. Which ones should they vote on tonight? Yeah, so if you want us to bring a proposal back at the next meeting Then I'd recommend taking no action on the district standing committees, but still making an appointment for the mga Can I just make a quick comment about the combination? I just like to see the infrastructure and public outreach combined and then the finance and admin services Be separate. I would love to have more outreach Because in the beginning it's really robust So anyway, thank you Um, we get I agree that the outreach committee is really important Any comments from the public this uh, this item Uh Board appointments Standing committee I know I just was agreeing the importance of outreach. I don't think it'd ever be under emphasized Yeah, so I mean right now mga. I've been serving on it for a while if somebody else is interested. That's fine I am There you go I go to the meetings anyway So, I don't know. Can we currently things if we're a board member and there's already two there I have Uh, I I'll leave it illegal. Yes Yes, there's an exception in the brown act for a quorum of the board to attend a noticed meeting of another agency. Okay. Good Okay Uh, yes I think I missed a couple of meetings this year. So I'd like to have one complete year. Yeah, okay My background is geotechnical engineering. That's what my master's degree is in and I am not going to be working full time next year So I have a lot more time for the mga and I was hoping that I could be on it. How about this idea Carla and rachel and then um, jennifer s the um alternate Sounds good That's my motion second Thank you Get the vote on it We do have to do a Yes, please. So that was your motion. I'll second it Too late. I already did Oh dang Okay, old gaver. Hi. Hi All opposed No opposition that's Uh passed unanimously and that would start right away, right? So like the meeting Later in december. No, I think it starts january. That's what I'm wondering But does that start in january as it's written the meeting is this thursday as it's written. It's january 2024 to december 2020 Okay, thank you Well, yeah, it's just like Transition for vice president and president starts the next meeting. Is that right? But the mga starts in january mga. It's january. Sorry to confuse them check And then just to review The jpaa Whenever there's a local meeting, I'll go to that meeting You know monoray or sacrament um We need a motion zone five and then the zone five and I haven't been able to attend those meetings So if somebody would like to attend I'd definitely love to attend. It's what day? Uh, it's every three months, right? It says fourth tuesday of the month um At 10 45 a.m Okay, I'll make the motion uh director about boney is On the uh flood can Represents us on the zone five Santa Cruz county flood control and conservation district second and then I um, okay I'll look on they already public commented on the whole uh all in favor Hi. Hi the opposed That's passed. Um, and then the last thing is the laugh code That says through are you still a member of glafko? She's 27. She's good till 20 27 Seven There's a typo in there and then um Do we need a motion to have you bring back the standing committee or is that just direction to staff? Okay Yeah Director, uh, president christensen. Let me just ask ama. Do we need to do motion five regarding aqua jpaa? Did we do that? President oh carla spoke up for that. Okay. I'm sorry. I just want to make sure we covered all this There is no vote, but there's I'll make the motion just to be clear. I'll second Reappoint carla Well, there's no not even I just yeah, I just want to make sure we cover Yeah, you're you were correct. I was wrong. I just wanted to make sure we were covering all basis I'm sorry for the inconvenience. So we did I did make a motion I second it. We do have a motion a second. So, you know, just Okay, it's comfortable. We can simply buy. Yeah Can you post? I I'm sorry. I'm in favor. I was delayed She's on a tape delay So sorry is that it that is it set for closed session in which we allow No comment four point over to four point seven four point six Oh, yeah, your reporting of exempt and non-exempt surplus land and it was pulled by I mean All right, I I guess I need an explanation of The significance of being exempt and not exempt right and also what the plans are for the properties Right. So we'll we'll team that. Nick and our ONM manager I think we'll come up to the mic up here and josh, are you able to handle the exempt non-exempt and then we can dive into the meat of it? Thank you Just couldn't figure it out easily Personal size and that that's roughly the distinction between the exempt and non-exempt So you can still sell them for some normal. It's correct. You can sell them And what has happened a lot of times in these cases is sometimes there may be an Adjoining property owner who might want to slightly enlarge their property Okay, thank you and then the Plans for some of these There's no current plans for any of these sites. I think that There's there's been discussions in the past, but I in I can address that I have a little knowledge that that predates nick if you remember I don't know a couple years ago Roughly the board we made a decision. I think it might have been the time before we brought it back last time The direction was let's get pure water soquel online because there may need parcels where it could be small But we need a pump or we need a reservoir or something like that. So At that time And we feel comfortable then we would may be able to make some more Recommendations that that had some more thoughtful consideration behind them, but right now we're kind of stuck in that limbo okay, so so We're now soon we'll be able to yeah, but for example the optimization study may That we're doing may indicate that uh, uh, you know, I'm just Hypothetical here, but it could indicate that a holding tank would be good to help recharge other parts of the basin to help Santa Cruz that sort of thing so Probably nothing up in the glenwood Areas probably probably not up in the uh the glenwood area. So that's probably one that can um You know, we've had talk around that could come off We don't see a lot of use the glenwood property for those don't know it's roughly 100 acres that right nick Yeah, 110 maybe and it's it's a very steep ravine area That we had hoped uh way back when uh, we could potentially build a dam on it and create a reservoir Now a dam is a four letter word these days earthquakes came and uh into the picture Right, certainly with with no, uh, uc dams coming down not being constructed Uh, so go ahead and water rights have been fully allocated Uh, we have no water rights to that stream and the end so-called creek is fully I think at one time we also considered as we were looking at ways to save money or generate income It was also to maybe harvest wood. What what is the opportunities of harvesting? wood from that property as then as a revenue stream That isn't affected. I believe by prop 218 Yeah, so we're we're evaluating those things and we certainly take the direction from the board, you know, whether uh, you know, uh proper forestry techniques to to uh Then out the forest and and Generate some revenue and like Melanie said the attractive thing to that is it's not 218 Um Limited so it could it could help people that you know, we often try to help that we we don't have a means to do that Well, maybe you'll propose something in the future where that's an option versus selling them Yeah, well, we'll look at the economics of it. It might be better just to sell it I mean the proposal you think a hundred acres up there is going to bring a ton of money But taj, I don't know if you remember but it wasn't it was a how much Something in that range. It wasn't that great. I mean it's still it's not a, um I just will put it to better use. Yeah, right exactly And if we do decide to sell How long the process is that? Josh you have an idea on that Roughly Months years oh, yeah months to short years Okay Thank you Thank you. Nick Thanks for sticking around one item you saw Public comment Thank you director leo for pulling this I have questions too And I wondered why the district has just clung to these properties Um when they could be sold and it would be a very good time to sell them The district certainly needs the additional money Even if it is a small amount um For example the lot on redwood drive in my neighborhood. I do know that the adjacent property owners would likely be interested in it. So why not? Why not? um Regarding the glenwood property I would like to see an analysis done In conjunction with dr. Andy fischer to see if this is a potential recharge area for perhaps a stormwater collection And a recharge managed aquifer recharge project I'm wondering why the capitol avenue Property that the district purchased as a potential Treatment plant site for the pure water so cal and purchased and demolished two historic homes on and Sent off some section eight people that really wanted to live there Um, why isn't that on here? Because you under the definition of surplus property you don't need it Although it was purchased one of the parcels. There are number two parcels. I think there one was to potentially expand office But why why not sell it? um And there is also of course aside from land there is Property that the district owns such as the trailer that was purchased as a construction trailer For the pure water so cal project and sets empty Because the district decided to lease another office space closer to the construction site, which makes sense But there's that empty trailer So I hope you will Consider doing some recharge on the glenwood if if you don't then please sell it. Thank you President christian, I'll just say there was again some misinformation. We do not have empty trailers They are office space, but you know Thank you, that's incorrect The district owns that trailer Please Please respect the decorum of the Please respect the decorum of the proceeds Thank you. Now the discussion about all that property is out of review with this of this item I think we're I think we're good. It just says adopted resolution 23. We would request a motion if the board's comfortable to move forward The item a second Do we have to do a roll call for this? It's up to the board I think that's it Yes, we'll be entering to a closed session. So that's the end of the public part of the meeting And the public are like invited to comment on Thank you As a public comment on closed session I I just want to tell you again that I have taken all action not because I want to but because it is important and and I care About the ramifications of what has happened what has not happened and um It has taken a big toll on me on my life my family's life But it is important And that is why I've done it I do not want to cause unnecessary expense as mrs. Lather sort of insinuated legal costs I I didn't want to do that and I don't want to do it yet, but You haven't followed the law The california department of fish and wildlife has never been consulted and that is law that is sequel law You can laugh go ahead and laugh but It is a it is a law that the district Collaborate with fish and wildlife to determine a set of mitigations that are legally Enforceable it is the line sequel. I don't have the code right here. I'll mail it to you. You can look at that So I have only done what I've done because I care and I'm not alone many people are very concerned and um I only wish that you could have delayed this a little bit This project a little bit because now likely by the end of this month direct portable reuse will be legal in the state of california Hopefully you will still use those expensive injection wells and inject Potable water and partner with the city of santa cruz in asr Thank you now beginning closed session And uh president christian said I have a brief announcement on 8.2. Um for that item The board will be meeting closed session related to potential litigation arising from an investigation by the office of inspector general related to Means attended by director jaffy on behalf of the district