VIRGIN VALLEY WATER DISTRICT REGULAR BOARD MEETING
VIRGIN VALLEY WATER DISTRICT OFFICE
NOVEMBER 15, 2011

Minutes of a Regular Board Meeting of the Virgin Valley Water District Board held on November 15, 2011, at the Virgin Valley Water District Office at 5:00 p.m.  Attending were President Karl Gustaveson, Vice-President Mark McEwen, Secretary-Treasurer Kenyon Leavitt, and Board Members Ted Miller and Sandra Ramaker.  Also present were District General Manager Ken Rock, District Legal Counsel Bo Bingham, District Hydrologist Aaron Bunker, District Accountant Wesley Smith, District Administrative Assistant Mary Johnson taking minutes and other interested parties of agenda items.   

• President Karl Gustaveson called the meeting to order at 5:00 p.m.
• Kenyon Leavitt offered a prayer
• Karl Gustaveson led the pledge.
• Public Comment – Barbara Ellestad with the Mesquite Citizen Journal questioned if public comment for the VRHCRP should be done now or at the time the item is heard.  Karl informed the public that item #8 would be opened to the public when heard.

Mr. Scott Dowding representing Mesa Townhomes HOA requested to be put on the next agenda regarding the main line system that goes to the meters and where the District’s responsibility ends and the HOA’s responsibility begins.  Ken explained to Mr. Dowding at what point the District’s responsibility ends; but it was determined that more time was needed for explanation and that this would be put on the next agenda for discussion.

• Board Comments – Mark McEwen stated that he was glad everyone was here and would have the chance to have their voice heard on very important issues tonight.

• President of Board Comments – Karl echoed Mark’s comment and further stated that this might be one of the most important decisions this Board will have to make and it should not be taken lightly and that he was glad for all the input.

CONSENT AGENDA:

Kenyon stated that item #7 should be pulled.  Mark stated that he would like item #8 heard before item #5.  Karl requested that the minutes be pulled from the November 1, 2011 Regular Meeting and be brought back at the next meeting for final approval.

Mark McEwen made a motion to approve the agenda and consent agenda as listed below with the adjustments mentioned above.  Ted Miller seconded this motion and it was unanimously carried.  5-0

1. For Possible Action - Approve Agenda – Minutes from 11/1/11 Regular Board Meeting pulled and to be brought back at the next meeting for final approval.  Item #7 pulled from the agenda.  Item #8 will be heard before item #5.

2. For Possible Action – Approve Minutes from 11/1/11 Regular Meeting – Pulled from the agenda and to be brought back at the next meeting for final approval.

3. For Possible Action – Approve Minutes from 11/3/11 Workshop

4. For Possible Action – Approve Bills Paid since last public meeting- $250,892.42

** End of Consent Agenda**

8. Public Hearing, Discussion, and for Possible Action – Discussion and public hearing on the Virgin River Habitat Conservation & Recovery Program (VRHCRP), the District’s obligations under the Endangered Species Act, and the District’s role and financial participation in the VRHCRP.  Possible action may include adoption of Ordinance IV and a corresponding fee to be assessed to new water users in order to satisfy the District’s financial and related obligations under the VRHCRP.  Possible action may also include determining the amount of any fee to be imposed by the District through Ordinance IV and other conditions to address the District’s financial participation in the VRHCRP.

Karl opened the item and Ken introduced the guests:  Ted Koch, State Supervisor of Nevada Fish & Wildlife (F&W), Barry Stubbs and Mike Ford with Robcyn, LLC; Jeri Krueger with F&W; Jon Sjoberg with Nevada Department of Wildlife (NDOW); and Liz Bickmore and Marci Henson with the Clark County Desert Conservation Program (Multi Species Habitat Conservation Program – MSHCP).  Ken proceeded to explain what back-up had also been included in the Board’s packets.

Mike Ford of Robcyn, LLC gave a history and explanation of how the VVWD got where they are at now.  Mike stated that this began in 1996 and 1999 with the Mesquite Lands Act (MLA), which was a federal legislation action to have the BLM sell in excess of 10,000 acres to the City of Mesquite (City).  The City adopted Ordinance 270 in May of 2002 that specified that the City would pursue the development of a habitat conservation plan and F&W would allow things to progress as this plan was being developed.  In July of 2002 the F&W issued a Biological Opinion (required under the Endangered Species Act (ESA)) in order to allow the land sale to go through.  This document was important and specified the terms and conditions for the land sale to proceed:  The City agreed to develop a habitat conservation plan and to participate in a hydrologic monitoring and mitigation program (HMMP) tied to the Virgin River. In June of 2004 this plan was initiated and scoping began.  In April of 2005 the effort was expanded to include other partners, which included the VVWD and the SNWA.  The ESA included species to the Virgin River that were not included in the Clark County MSHCP, and the VVWD and the SNWA are not included in the MSHCP.  In July of 2005 the VVWD came to the table along with other partners; BLM, F&W, City, SNWA, Clark County and NDOW.  In October of 2007 the City passed Ordinance 387 to collect an interim fee and the City began collecting $500 per gross/acre fee, in addition to the $550 for the Clark County MSHCP.  In March of 2008, all participants entered into a Memorandum of Agreement (MOA) in order to establish the roles, responsibilities and participation in the implementation and development of the plan and to establish a process for a budget for the plan.  Mike then explained the process of the completed draft document, public participation and timeframe.

Bo asked for clarification of when Mike stated that all of the participants who signed the MOA were currently participating with the VRHCRP; but Bo’s understanding was that Clark County had stepped away from the VRHCRP, and only participates in the Clark County MSHCP. Marci Henson stated that Clark County was a participant, but they were not a permittee.  Marci then explained that Clark County was a member of the Executive Committee for the VRHCRP; all Clark County conservation efforts are covered under the MSHCP; and that Clark County would help coordinate activities for the conservation actions that occur between the VRHCRP and the MSHCP.

Mike Ford explained that there are only three applicants with the VRHCRP (City of Mesquite, VVWD and SNWA).  There are seven participants within this plan, but only three permittees.

Kenyon questioned if the City had not taken down the land from the MLA, would there still be a need for a Take Permit.  Mike Ford explained that if the City did not take down the land, the City may not have required a Take Permit, but the VVWD and SNWA have activities along the Virgin River and would eventually require such a permit; but the MLA sales did require the City’s involvement.  Mike gave an opinion that Takes have been occurring along the Virgin River for some time, but the VVWD has not had a Take permit issued.  The VVWD became involved with the VRHCRP plan and this will allow lawful Take to occur.  Mike also stated that the VVWD is not covered under the Clark County MSHCP. Mike stated that money is required for mitigation and that this is almost like an insurance policy, but it is protection for the permittee against third parties.

Bo asked to clarify one thing and stated the VVWD wants to comply with the ESA and that the Incidental Take Permit would authorize the VVWD to continue to engage in activities that the VVWD is already involved in; but the clarification that Bo wants to make is, you [Mike] mentioned that Take has already occurred.  Bo stated that he has read the Biological Opinion and the Environmental Assessment several times and wanted to make sure the record is clear that there are opinions that the District’s activities could impact certain species, and that those species appear to be in the area, however, the report in not definitive on a variety of issues, but the opinion that VVWD has already engaged in some kind of harm or some kind of Take; Bo doesn’t see it that way.  Bo further stated that the VVWD certainly wants to comply with the ESA in doing what is necessary to obtain the appropriate permit.

Mr. Ted Koch stated that he has only been working for Nevada F&W for a couple months, but that he has extensive experience in the ESA and the process.  Mr. Koch stated that prior to 1982 there was no opportunity for non-federal entities to be permitted to take endangered species at all.  With the 1982 amendments to the ESA congress used the term “creative partnerships” to describe what these partnerships were to be.  Mr. Koch stated that in his opinion what makes a permit applicant successful is two factors:  one being a genuine regulatory concern that their actions are taking ESA species; and the other is a genuine concern for the environment and leaving the world a better place for our kids.  Mr. Koch stated that they look forward to working with the VVWD.

After comments from the Board, Mr. Koch explained that there are risks that the VVWD faces if they do not comply with the ESA.  One risk is the law enforcement side where the F&W would prosecute people for an unauthorized Take; and the second, which happens more frequently than the first risk, is third party litigation.  If the VVWD does not get a permit, they would be the litigation target.  If the VVWD has a permit, the Service is the litigation target.

There was discussion regarding whether there have been sightings of the endangered species and Ken commented that the program was also for recovery and even though few species have been seen, with recovery, they could return.  Jeri Krueger with F&W along with Jon Sjoberg with NDOW talked about the endangered/native fish, sightings, a recovery program to re-establish the native fish, and that they are working closely with Arizona and Utah F&W also.

Karl asked Marci Henson with Clark County to explain the MSHCP, its funds, and participants.  Marci explained that there was a $47 million fund balance expected by 2013 and that must be used for the Clark County MSHCP.  The City is a permittee and has access to the MSHCP for the endangered species listed, but the VVWD is not a permittee and does not have access to the MSHCP.

Bo questioned if the City could designate the VVWD as a permittee or as a “Permittee’s agent” and Marci informed Bo that he could contact the DA’s office, but that the VVWD’s activities would affect the fish in the river and the MSHCP does not cover fish.  Marci explained how the funds were used and allocated through the MSHCP.

A lengthy discussion ensued regarding the plan, fees, how to determine the fee to be charged, and how the funds are spent.

Karl opened the item to the public.

Barbara Ellestad with Mesquite Citizen Journal questioned if the cap of $550 for any conservation fee for Clark County was set by NRS.  She questioned how soon F&W would issue a permit to the VVWD.  She questioned if you did not know how much it would cost and there was no plan, how you can charge a fee.  Barb also questioned the amount charged per/acre for conservation by Clark County, City of Mesquite and VVWD.

Harold Sersland of Mesquite questioned where the F&W recovery actions could be found and if the VRHCRP committee meetings were opened to the public.

Kraig Hafen of Mesquite questioned a quote that Mike Ford made earlier and thought that the fee should be implemented later after the plan was approved.

Chuck Bentley with Pride Contractor’s of Mesquite stated he was in favor of the VVWD participating in the VRHCRP and moving forward with a fee and stated that a commitment has been made and all entities should honor their commitment.

David Ballweg of Mesquite questioned the VRHCRP and the MSHCP plans and the endangered species covered within both plans and why were not we annexed into the Clark County plan.  David questioned paying the fees before a Take Permit was issued.

Ryan Wheeler with Forsgren Associates, Inc. questioned the different fees for the VRHCRP and the MSHCP and the permittees.

Robert Smith of Mesquite questioned why Board members did not know about the plan and stated that they should do their work and read it.  Mr. Smith also commented on the third party litigation and the genuine concern that Mr. Koch mentioned earlier.

Wally McClure of Mesquite commented on government agencies.

Public comment was closed.

Sandra Ramaker made a motion to go forward with the VRHCRP and to set the fee at $200 per ¾” connection for Ordinance IV; this fee would apply to new customers only; and no fees would be paid from the District’s general fund. 

Mark McEwen stated that he agreed with a lot of what Sandra said, but that he was more inclined to support a fee that matches what Mesquite is taking and the District should charge $166 per connection.  (Mesquite collects $500/acre and according to Mesquite records, it is calculated that there are 3 units per acre which also takes into account open and green space within that acre.)

Sandra Ramaker amended her motion to go forward with the VRHCRP and to set the Ordinance IV fee at $166 per ¾” connection; this fee would only apply to new customers; and no fees would be paid from the District’s general fund.  Mark McEwen seconded this motion and it was carried by a vote of 3-2 with Ted Miller and Kenyon Leavitt opposed.

Bo asked for a couple points of clarification based on the action taken.  1.  That the fee only applies to new development.  2.  When the fee would become effective; immediately, after F&W’s approval of the proposed plan, or after the VRHCRP has gone through public comment period.  3.  Whether F&W would provide any feedback on the Board’s action on this item.  Karl asked Ted Koch of F&W if they had a response and Mr. Koch replied that they were not ready to give feedback at this time.

There was continued discussion when the VVWD should begin charging the fee.  Mike Ford stated that as a representative for the VVWD he did not believe the District would begin to charge a fee until after the permit was issued.  Bo thought that a second motion should include that the fee will only apply to new development and commence after an Incidental Take Permit is issued.

Sandra Ramaker made a motion that this fee (Ordinance IV fee) would be for new connections only and would not start until after the Incidental Take Permit is issued. Mark McEwen seconded the motion and it was carried by a vote of 4-1 with Ted Miller opposed.

Karl Gustaveson called for a five minute break at 8:06 p.m.

The meeting reconvened at 8:20.

5. For Discussion & for Possible Action – Information regarding electronic billing, customer water use history access, and the possibility of e-mail notification of bills will be presented by Tracy Lee, District’s Information Technology (IT) specialist.  The Board may continue the current policies or request research and report to the Board on additional costs and benefits expected with e-mail billing as an option.

Tracy distributed a handout showing a snapshot of the District’s webpage for paying bills and explained how this site worked.  Tracy stated that customers have requested that they do not want to receive monthly statements, but in order to accomplish this; the District would have to redesign the billing system.  Tracy explained that the District outsources their bills and explained the process for monthly billing.  The outsourcing company would have to manually pull out and throw away the monthly bill which would increase the monthly costs.  Tracy recommends no changes at this time, however, if legal could provide a waiver to the customers who do not wish to receive a monthly statement; this may alleviate any liability to the District if the customer does not receive the electronic notice for any reason.

Discussion ensued regarding the billing system, customers, other utilities, credit cards and costs.

Direction was given to staff to look into the costs of outsourcing and to compare with other vendors, costs of updating the website, costs for software, etc. and have information available during the budget process.

6. For Discussion – An opinion from the General Manager regarding water use and conservation policies in response to an August 24, 2011 letter to the Board of Directors from Ron Walters

Ken stated that the intentions of landscapers is sound and we do not want to waste water in the desert.  The District does have enough water at this time and conservation mandates are not required, but we need to show landscapers and customers how to have a lush landscape without using a lot of water. 
Discussion continued regarding the District’s conservation program and Ken stated that the District will lead by example when the District’s conservation garden is completed.

9. For Discussion & for Possible Action – Consideration of revisions to Section IV-7 of the District’s Operating Rules, Regulations & Rates (Operating Rules).  Possible action may include amendment or revision of Section IV-7 of the Operating Rules in order to make such rule consistent with Ordinance IV if adopted pursuant to the preceding agenda item.

Kenyon questioned changing anything in the Operating Rules until the Take Permit is issued.  Bo commented that the Operating Rules in their present form make mention of Ordinance IV and being paid before the General Manager would sign off on the maps as Ordinance II.  After the Take Permit is issued, Ordinance IV fees would be paid at the time of connection.  Bo further stated that if the District wanted to be correct, we should remove mention of Ordinance IV until the District has the Incidental Take Permit and Ordinance IV is actually being charged.

Kenyon Leavitt made a motion to strike Ordinance IV references in the Operating Rules Section IV-7 and adjust the meter, impact and Ordinance fee schedule to represent Ordinance IV fees when applicable.  Sandra Ramaker seconded the motion and it was unanimously carried.  5-0

10. For Discussion & For Possible Action – Discussion relative to a confirmation and ratification of the General Manager’s approval of $22,059.52 in change orders to the Trade West contract for pressure relief valve covers and improvements to the drain line from treatment plant and reservoir site #32.

Kenyon commented and asked that in the future, could this type of item where ratifying an expense over $2,500 that has already been paid, be put on the consent agenda.  Bo stated that he thought it was put on the agenda to be consistent with the VVWD Operating Rules, but did not disagree that this could be put on the consent agenda.  Ken explained why these change orders occurred. 

Kenyon Leavitt made a motion to confirm ratification of the General Manager’s approval of $22,059.52 in change orders to the Trade West contract for pressure relief valve covers and improvements to the drain line from treatment plant and reservoir site #32.  Ted Miller seconded the motion and it was unanimously carried.  5-0

11. For Discussion & for Possible Action – Apply to the Bureau of Reclamation (BOR) Basin Study Program on behalf of the Virgin Valley Water District and other future stakeholders.

Ken reported that we received notification that the BOR has a program in 2012 for supporting 2 to 4 basin studies, at a fifty/fifty split with BOR, with a budget of $2.5 million.  After Ken, Mike Chandler and Aaron reviewed the application, they feel that the VVWD would be a good candidate for this study with three states and four counties involved.  Ken worked on Nevada stakeholders, Mike Chandler with Utah stakeholders and Aaron with the Arizona stakeholders and each has received confirmation that representatives from the states mentioned would consider participation with the basin study. 

There was further discussion with Ken explaining how the application and basin study process would proceed.

Ted Miller made a motion to apply to the Bureau of Reclamation Basin Study Program on behalf of the Virgin Valley Water District and other future stakeholders.  Kenyon Leavitt seconded the motion and it was unanimously carried.  5-0

7. Hydrologist’s Report

Aaron had included a written report.  Aaron also reported that he had the opportunity to attend a BLM workshop that was quite informative.  Aaron met with the BLM representatives in our area and discussed the District’s ROW’s and permits and also feels more comfortable using the BLM data base.

Aaron also mentioned that he, F&W and SNWA took a field trip today through the Virgin River corridor and that he has also been working on the BOR grant proposal.

8.  General Manager’s Report

Ken had included a written report with significant events since the last Board meeting.  Ken also informed the Board that most of his time has been working on the VRHCRP, litigation matters and BOR’s letter of interest in the basin study.

9. Public Comment

There was no public comment at this time.

10. Adjournment

President Karl Gustaveson adjourned the meeting at 9:15 p.m.
 

NOTE): The minutes of this meeting have been tape-recorded and will remain on file in the District office for a one-year period for public examination.

• Board Meeting Minutes: 2011-11-15 (.pdf 43.K)