HomeMy WebLinkAboutRegular Minutes - 6/20/2023 REVIEWED FOR REDACTION
MINUTES
CLAY COUNTY UTILITY AUTHORITY
June 20, 2023
The Board of Supervisors of the Clay County Utility Authority (CCUA) met in Regular Session in the Board
meeting room at the Administrative Office of the Clay County Utility Authority, 3176 Old Jennings Road,
Middleburg, Florida, on the above-stated date.
Item No. 1 —Call to Order
Chairman Davis called the meeting to order at 2:00 P.M.
Item No. 2—Invocation/Pledge of Allegiance
Mr McNees offered the Invocation and led those in attendance in the Pledge of Allegiance.
Item No. 3—Roll Call
Roll Call was taken with Chairman Davis, Vice-Chairman Roark, Mr. Hodges, Ms. Lebesch, Mr. McNees, and
Mr. Starnieri in attendance.
Also present at the meeting were Chief Operations Officer Darryl Muse, Chief Financial Officer Jeff
Wesselman, Assistant Chief Financial Officer Karen Osbourne, Chief Engineer Paul Steinbrecher, Assistant
Chief Engineer Joe Paterniti, Chief Human Resources Officer Kim Richardson, Distribution & Collection
Superintendent David Rawlins, Water Department Superintendent Ross Bland, Public & Governmental Affairs
Liaison Dennis Ragosta, Construction and Inspection Services Manager Warrick Sams, Compliance Manager
Heather Webber, Contract and Procurement Specialist Darrin Parker, Administrative Assistant Operations
Alicia Baker, Administrative Assistant Engineering Anneica Asberry, and Grady H. Williams, Jr., legal counsel
to the CCUA.
Item No. 4—Employee Recognition
a. Dwight Garth—5 years
b. Nicolas Jourdan— 5 years
c. Tamantha Spaid - 15 years
Chief Operations Officer Darryl. Muse introduced and presented a certificate to Utility Engineer Heather
Cavanaugh, Water Plant Operator Nicholas Jourdan, and Financial Assistant - Accounts Payable
Tamantha Spaid acknowledging their years of service.
Item No. 5 —Approval of Minutes
a. Board of Supervisors Regular Meeting, June 6, 2023
After discussion, Ms. Lebesch moved, seconded by Mr. McNees, and carried 6-0, to approve the
minutes of the Regular Meeting held on June 6, 2023.
Item No. 6—Approval of Consent Agenda
After discussion, Mr. Hodges moved, seconded by Vice Chairman Roark, and carried 6-0, to approve
the Consent Agenda as follows;
a. Approval of Financial and Operational Activities
1) Approval of Payment of Warrants
Warrants totaling $2,818,707.93
a. Schedule of payments to Sole Sources
b. Schedule of Emergency Repairs/Purchases -None
c. Schedule of items initiated under Emergency Contract-None
d. Schedule of payments from the Emergency Account
e. Schedule of claims paid under the Sewage Backup Response Policy -None
f. Detailed Descriptive Warrant Report
g. Statement from Grady H. Williams, Jr. LL.M.
2) Request for Asset Disposal Authorization-None
b. Approval of Capital Budget Activities
1) Requests for Award of Procurement Contracts and/or Ratification of
Procurement/Construction Contracts
a. Proposed Approval of Contract Renewal for CLX Chlorine Analyzer and JAW
Reagent Contract ITB# 20/21-A8
2) Approval of Supplemental Agreements and Change Orders
a. Proposed Supplemental Agreement No. 4 with Bradshaw-Niles& Associates, Inc.
for Professional Surveying Services to complete a topographic survey of
Lakeview and Hilltop Streets to be utilized for the design of a new water main
b. Proposed Supplemental Agreement No. 11 to the Civil and Environmental
Engineering Professional Services Agreement 2018/2019 RFQ No. 3 for Jones
Edmunds & Associates, Inc., to provide Hydraulic Modeling Analysis, Summary,
Recommendations, Conversion, &Development
c. Approval of Financing Requests -None
d. Approval of Contract Usage
a. Request for advance approval to utilize other government contracts - OMNIA
Partners Contract No. R2100701 Human Capital Management Systems and
Managed Business Solutions & OMNIA Partners Contract No. 05-47 Heavy
Equipment, Diesel Truck, Bus Parts and Related Goods and Services
e. Approval of Developer Agreements, Warranty Deeds & Easements
1) Developer Agreement KH22/23-12 — Water Service to 7422 Hallman Road (Dale &
Judith Frazier) — 1 ERC water, 1 ERC AWS, 1 ERC SJRWMD, 1 ERC debt service -
$5,265.19 (financed)
2) Developer Agreement KH22/23-13 — Water Service to 502 SE 44th Street (Matthew
Clark Construction, LLC)— 1 ERC water, 1 ERC AWS, 1 ERC SJRWMD, 1 ERC debt
service - $2,454.59
3) Developer Agreement KU22/23-48 —Driven Take 5 Car Wash—789 Blanding Boulevard
EBoing US Holdco, Inc.) — 21 ERC's water, 18 ERC's wastewater, 21 ERC s AWS, 21
RC's SJRWMD, 18 ERC's environmental impact, 18 ERC's debt service- $88,444.93
4) Developer Agreement KU22/23-49 — Settlement Agreement #4 for Salon Lofts — 4465
US Highway 17, Suites 1-5 (Louis L. Huntley Enterprises, Inc.) — 1.77292 ERC's water,
1.77292 ERC's wastewater, 1.77292 ERC's AWS, 1.77292 ERC's SJRWMD, 1.77292
ERC's environmental impact, 1.77292 ERC's debt service - $8,322.38
5) Developer Agreement MU22/23-20 — Creekview Trail Areas 1 & 2 — 305 Single Family
Lots (Creekview GP, LLC) — 305 ERC's water, 305 ERC's wastewater, 305 ERC's
reclaimed, 305 ERC's AWS, 305 ERC's SJRWMD, 305 ERC's debt service —
242,165.45 (deferred)
Item No. 7—Customer Account Adjustments—None
Item No. 8 —Executive Director's Business
a. PFM Financial Advisors LLC recommendation for financing and overview of sample Debt Management
Policy
Chief Financial Officer Jeff Wesselman introduced Managing Director Jeremy Niedfeldt of PFM
Financial Advisors, LLC. PFM Financial Advisors LLC ("PFM") was engaged to serve as financial
advisor for CCUA's proposed issuance of a privately placed Utility System Revenue Note, Series 2023
(the "2023 Note") to be issued to provide funds to finance the cost of capital improvements and pay
costs of issuance. The 2023 Note is payable solely from and secured solely by a pledge of the net
revenues of CCUA's Utility System and will be issued on parity with CCUA's Series 2012, 2015 and
2019 Notes under and pursuant to CCUA's Bond Resolution. The size of the 2023 Note is a not-to-
exceed par amount of$75 million. Based on recent aggressive bids received from financial institutions
for similar financings, PFM recommended CCUA pursue a privately placed direct bank loan (or line of
credit), which in today's market was expected to be an efficient and cost-effective method of financing.
All Authority debt currently outstanding is privately placed with a bank or issued as a State Revolving
Fund loan. At CCUA's direction, following the Board's direction to proceed, PFM distributed a request
for proposals ("RFP") on April 26, 2023. The RFP was sent to a list of local, regional, and national
financial institutions to identify the institution that could provide CCUA with a fixed rate, nonbank
qualified term loan at the lowest overall borrowing cost, pursuant to certain conditions as determined by
CCUA. Prior to the submittal deadline (2:00 pm on May 25, 2023) CCUA received three (3) proposals
from the following firms: Bank of America, JPMorgan & Truist. The proposals received from Bank of
America & JPMorgan were traditional line of credit proposals. Of the two, Bank of America provided
the more competitive interest rate at 4.63% for drawn proceeds and 23 bps for undrawn proceeds (up to
50% of the facility). Comparatively, Truist proposed a traditional loan, fully drawn at close, at an
interest rate of 3.56%. Assuming the Authority has fully drawn on the $75 million facility, this equates
to annual interest savings of$802,500 in favor of Truist. Prior to a full draw on the loan, Truist provides
an investment return on unutilized funds held in escrow. CCUA can choose between a guaranteed rate of
3.55% or a managed portfolio with the bank at an underlying yield of 4.05%. Based on PFM's review
and discussions with CCUA's staff and Bond Counsel, it was determined that Truist provided the most
cost-effective financing alternatives along with favorable conditions. The proposed interest rate, 3.56%,
is locked through the anticipated closing date of June 29, 2023, which eliminates the risk of rising
interest rates between the proposal submittal date and closing date. After discussion, Mr. Hodges moved,
seconded by Ms. Lebesch, and carried 6-0, to award the RFP as presented and authorize execution of the
documents necessary for the anticipated closing on June 29, 2023.
b. Annual Update on the Alternative Water Supply Initiative
Chief Engineer Paul Steinbrecher provided an update on the Alternative Water Supply (AWS) surcharge
and the increases to the potable water connection charges which were authorized and implemented under
CCUA Rate Resolution Number 2015-2016-01. Section 4.(7) of the Resolution requires staff to report
to the Board each year regarding the adequacy of the current AWS surcharge and connection charges.
He also reviewed the progress of the project during the Fiscal Year and recommended a 3% increase to
AWS surcharge and connection charge, consistent with the proposed plan. After discussion, Ms.
Lebesch moved, seconded by Mr. McNees, and carried 6-0, to as a part of the AWS Financial
Management Plan, approve a 3%increase to the AWS surcharge from $1.15 to $1.18 and connection fee
from $376.71 to $388.01 which will be included as a part of the proposed 2023/2024 Fiscal Year
Budget, as presented by Mr. Steinbrecher.
c. Construction and Inspection Quarterly Progress Report
Construction & Inspection Services Manager Warrick Sams presented the Construction and Inspection
Quarterly Progress Report to the Board. This report was for the Board's information only; no action was
requested or required on this item.
d. Lake Asbury Master Planning Area Trunk Main Capital Cost Recovery Policy — request to schedule a
public rate hearing
Chief Engineer Paul Steinbrecher and Marcy Cook of Dewberry provided information to the Board
about the history and future of the Lake Asbury Master Planning Area (LAMPA) Trunk Main Capital
Cost Recovery Policy. On December 16, 2022, staff presented to the Board of Supervisors a proposed
cost recovery policy that would allow CCUA to recoup its capital outlay in pioneering a series of water,
wastewater, and reclaimed water trunk mains within the LAMPA. The full build-out of the LAMPA will
nearly double CCUA's current customer base. Pioneering trunk main infrastructure ahead of this
anticipated growth will position CCUA to better serve development and those future customers. CCUA
will also realize a cost benefit by collaborating with other stakeholders such as Clay County, FDOT, etc.
to install the trunk main infrastructure during or near the construction of major roadways within that
development. In addition, staff believes constructing these projects in close succession will develop the
trunks necessary to support this substantial service grid. Service grids provide alternate service pathways
to provide and maintain service in the event of pipeline breaks or damage. Service grids also provide
redundant support for areas during times of high-water demand. The cost recovery policy, prepared by
our legal team of Sundstrom and Mindlin, LLP, would apply only to those areas within LAMPA that
will receive an immediate direct benefit within an initial ten(10)year forecasting period. The benefitting
areas have been identified by CCUA's engineering consulting team, Dewberry, in a technical report that
also provided conceptual costs for the pipelines and cost recovery mechanism being considered in this
policy. Dewberry's conceptual opinion of construction cost totals $25.6M for the proposed trunk mains
for the areas of development being considered. At the December meeting, the Board of Supervisors
authorized a public workshop to receive public comment on the proposed cost recovery policy. Staff
held the public workshop in the CCUA Board Room on Thursday, February 16, 2023, between 11 a.m.
and 1 p.m. Approximately fifteen (15) people attended, consisting primarily of representatives of the
development industry. The attendees generally agreed that the cost recovery policy was technically
sound and sensible but requested that CCUA reconsider when the developers get charged under the
policy. As proposed, the policy currently stipulates those costs will be recovered on an Equivalent
Residential Connection (ERC) basis as part of CCUA's Developer Agreement process, with payment
due when the agreement is finalized for approval by the Board of Supervisors. The development
representatives requested that the cost per ERC be deferred until a meter is set. Staff considers the
request of the development representatives a policy decision for the Board of Supervisors. Staff
disagrees with this suggestion on the basis that CCUA will be carrying the risk and cost and of the
pipelines — both their construction and ongoing maintenance — while developers will receive direct and
valuable benefits in the use of the pioneered infrastructure to flush, pressurize, test, and ultimately
complete their projects. Given the significant investment in pioneering utility infrastructure under the
proposed policy, staff believes developers have a reasonable responsibility to reimburse CCUA upfront
in the Developer Agreement process, having been relieved of the cost burden and associated risks of
constructing these mains as otherwise required in CCUA's standard Service Availability Policy. As a
result of Staff's disagreement on this point, staff recommends proceeding as originally proposed with a
LAMPA Cost Recovery Policy public rate hearing. Mr. Steinbrecher requested clarification from the
Board if it was their intention to have staff proceed as the policy currently stipulates, recovering the
costs on an ERC basis as part of CCUA's Developer Agreement process, with payment due when the
Developer Agreement is finalized. After discussion, Mr. Hodges moved, seconded by Vice-Chairman
Roark, and carried 6-0, to schedule the Public Hearing to consider and take public input on the LAMPA
Cost Recovery Policy during the previously scheduled 2023/2024 Fiscal Year Budget Public Rate
Hearing which is to be held on Tuesday, September 12, 2023, at 7:00 P.M. and to have staff proceed
with the Trunk Main Capital Cost Recovery Policy as originally proposed.
e. Other
Mr. Muse informed the Board Governor DeSantis has signed Florida's 2023/2024 budget which
included two $500k allocations for CCUA's upcoming construction projects. He also informed the
Board staff is currently monitoring named storm Bret.
A representative from Brown & Brown Insurance presented a 2023-2024 Employee Benefits Pre-
Renewal Summary outlining the options which will be available for CCUA employee's health insurance
coverage renewal through Florida Blue. She also reported the proposed renewals proposed no rate
increase for dental, life, and disability coverage. This report was for the Board's information only; no
action was requested or required on this item at this time.
Item No. 9—Legal Business
a. Approval of Private Attorney Services Agreement - Butler Snow LLP
Mr. Williams presented a request for approval of the Attorney Engagement Package with Butler Snow
LLP. After discussion, Mr. McNees moved, seconded by Mr. Hodges, and carried 6-0, to pending final
approval from the Office of the Attorney General, approve the Attorney Engagement Package, as
presented.
b. Action on proposed Resolution No. 2022/2023-06 — Utilities System Revenue and Refunding Bonds
Series 2023
Mr. Williams introduced Ms. Emily Magee of Butler Snow LLP who requested action on proposed
Resolution No. 2022/2023-06 — Utilities System Revenue and Refunding Bond, Series 2023. She also
informed the members they will see an amendment to this Resolution at the July 18, 2023, Board
meeting. After discussion, Vice-Chairman Roark moved, seconded by Mr. Starnieri, and carried 6-0, to
approve, adopt and enact Resolution No. 2022/2023-06 — Utilities System Revenue and Refunding
Bond, Series 2023, as presented.
c. Other-None
Item No. 10—Old Business/New Business -None
Item No. 11 —Public Comment-None
Item No. 12— Supervisor Comments
Vice-Chairman Roark congratulated staff on their milestones and shared it was a great meeting today and the
hard work of staff and the consultants was evident in the presentations. He also tendered his 30-day notice of
resignation from the Board. He has accepted a position at a hospital in another state and will no longer be a
resident of Clay County.
Mr. McNees thanked staff and the consultants for their efforts.
Ms. Lebesch shared Mr. Roark will certainly be missed and said she appreciates all the hard work involved in
providing the background information on the items which come before the Board.
Mr. Hodges also shared Mr. Roark will be missed.
Mr. Starnieri congratulated staff members on their service milestones.
Chairman Davis shared the story of his first meeting with Mr. Roark and said he will be missed by the
community and the members of the Board.
Item No. 13 —Adjournment
Chairman Davis adjourned the meeting at 3:11 P.M.
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Wendell Davis, Chairman
112 WAR
ar�ice .ouden ilk, Recording Secretary