SLVWD Board Meeting Summary
November 10, 2020
Mark Dolson
Note: This was a special follow-up meeting necessitated by the November 5th meeting.
Old Business
Urban Water Management Plan (UWMP)
Carly Blanchard (Environmental Planner) reported on new developments since the 11/5 Board meeting at which the Board failed to choose between working with Water Systems Consulting, Inc. (WSC) or West and Associates (West) to produce the required 2020 UWMP which must be submitted by 7/1/21. She presented the Board with three options:
Work with Scotts Valley to execute an agreement with WSC (with further negotiations)
Work with or without Scotts Valley to execute an agreement with West
Sever the partnership with Scotts Valley and release an updated request for proposals
Both Staff and the Environmental Committee were already on record as strongly recommending WSC due to serious doubts about West’s ability to perform as advertised. Carly reported that WSC had provided an updated proposal which reduced the cost to the District from $60,000 to $58,000. The cost reduction depends on a small amount of additional staff time for data preparation. WSC produced the District’s previous UWMP five years ago at a cost of $50,000, and the 2020 plan is much more robust due to new requirements resulting from recent Assembly bills. In contrast, West claims to be able to complete the job for $20,000.
Director Fultz was unimpressed with WSC’s “3.3% cost reduction.” He said it was very clear to him from reading the West proposal that they clearly understand what it takes to do this and that they have done it before. He criticized the WSC cost breakdown as bloated and suggested that a richer District such as Scotts Valley might be happy to overspend but that SLVWD cannot. He described West as a smaller company that understands the recent changes to the UWMP requirements and gets things done very quickly without the overhead of WSC. Director Fultz also noted that SLVWD customers use between 35 and 40 gallons of water per day, which is substantially below the state’s long-term goal. Consequently, he sees this plan as a mere formality which does not merit a big investment. He noted that the District has had problems with WSC in the past and maintained that West can perform the required work very quickly and efficiently without the major impact on Staff time that the staff is confident will occur.
Director Farris tried to get Carly to quantify the anticipated impact on staff time and the probability of success if the District were to opt for West, but Carly was not able to provide specific numbers. He also wondered what quote West would produce if they were working only with SLVWD, but this remains unknown.
Director Fultz asked about any recent further discussion with West, but Carly said that Scotts Valley has been taking the lead on this. Director Fultz said he was uncomfortable with the assumptions being made by Staff; he said the West proposal would still be cheaper even if West ultimately demanded twice their original bid. He argued that it is important for the District to diversify its supplier base because companies charge more when they take our business for granted. Director Moran noted that online reviews of both companies are favorable.
Rick Rogers (District Manager) argued that this project presented a great opportunity to work with Scotts Valley (which prefers WSC). These two districts used to have a much worse relationship. Rick said teaming up is very important and will go a long way toward strengthening this relationship as this will be the first joint effort. It is also attractive that the lead consultant for WSC works with the Santa Margarita Groundwater Agency and is very tied to the basin. These benefits are difficult to quantify.
Tina To (Director-Elect) described the joint plan as highly desirable. It will save money and, especially, time, and this strongly favors WSC. She said going with West would be a mistake, not only because they will likely come back seeking more money but, more importantly, because they will potentially miss the deadline which will lead to missing grant opportunities.
Director Fultz restated his objections to WSC. He said the District needs to be looking for ways to aggressively reduce costs; it can't keep running in place with all of its rate increases going to operating expenses. Rather the District’s culture needs to change. Director Fultz asked how the District could improve supplier diversity if it refused to give newcomers a chance (as this disincentivizes others from responding to proposals in the first place). He moved that the District Manager be directed to enter into a contract with West, but nobody seconded this.
President Henry moved to authorize the District Manager to coordinate with Scotts Valley Water District to enter into a contract with WSC as stated in the revised quote of $116,000. Director Moran seconded, and the motion passed 3-1 with Director Fultz voting against it.
Board of Directors Vacancy
Gina Nicholls (Legal Counsel) summarized the memo in the Board packet. The staff recommended that the vacancy be filled by appointment on or after 12/7/20. Alternatively, the Board could appoint someone 12/3/20 (before the new Board is seated), or the Board could call for an election. Lastly, the Board could take no action at this time. The Board has until 1/4/21 to resolve this issue on its own terms.
To fill the vacancy by appointment, a notice must be posted at least 15 days in advance of Board consideration. In practice, this might need to be closer to 20 days to allow for all the necessary steps to be completed.
To fill the vacancy via an election, notice must be given at least 130 days in advance. It turns out that the only 2021 election date that is compatible with this constraint would be the November, 2021 election. The District would need to pay up to $80,000 for this election, but it is likely that this cost would be split with someone else. In this scenario, the Board would have only four members until December, 2021. Also, the seat filled in November, 2021 would be up for election again in November, 2022.
Director Fultz offered the following timeline as background: Steve Swan sold his house 9/24/20 and announced that he was now living in Texas on 10/15/20. In order for his seat to have appeared on the ballot this November, the vacancy would need to have occurred by 6/26/20. In order for his seat to have appeared on the ballot this coming March (as part of a special election being held by the School District), the Board would have needed to take action by 10/23/20.
Director Moran delivered a long, deeply personal explanation for the decision that he had privately come to: filling the vacancy via election in November, 2021. This was unexpected, as Director Moran very clearly stated in the 11/5 Board meeting that the newly-seated Board should fill the vacancy via appointment. Now, he said that the Board should do its utmost to avoid the appearance of “shenanigans,” and he insisted that the only way to achieve this goal was via “direct democracy.” He said he was confident that the District could manage adequately for the next 12 months with only four Board members, and he was untroubled by the contradiction of an appointed Board member insisting that it would be improper to allow another appointment. He also talked at length about his military service and commitment to democracy. He subsequently argued that the cost of the election was inconsequential and that the important thing was to “change the culture” to ensure that Grand Jury investigations and talk of “shenanigans” would be a thing of the past.
President Henry said a four-person Board would be vulnerable to deadlock and would also impose a substantially increased burden on the four members who would be left to do the work of five.
Director Fultz thanked Director Moran for his wisdom and his service. He said Rick has always been able to crystalize issues and bring the thought and empathy that Board members should strive for.
Public input was strongly and unanimously opposed to filling the vacancy via a November, 2021 election. Jim Mosher said Rick and Lew have demonstrated the strength of the appointment mechanism. He added that, on a practical level, an election will cost the District money that Director Fultz otherwise wants to save; that direct democracy will come in two years; and that appointments work and are part of the responsibility that Board members are elected to fulfill. He stressed that a four-person Board places a huge burden on members and described an election as a terrible idea.
Tina To (Director-Elect) emphasized that the election is a full year away. She said this was just too long and was also fiscally irresponsible. She noted that 70 people in the community had gone on record in the past few days as strongly advocating for the vacancy to be filled by appointment by the new Board. This should be taken into consideration.
Cynthia Dzendzel argued that we have just had an election. She saw no reason to wait an entire year to allow someone to participate when there is so much work to be done, and more opinions are always helpful. She advocated for allowing the new Board to choose an appointee.
Joni Martin said she has talked with a wide range of people in the valley and has not observed the “us and them” mindset that some Board members have referred to. Every person she spoke with said that it would be bizarre not to let Gail and Tina participate in making the appointment since the voters have already clearly expressed their will. The democratic option is actually to have the new Board fill the vacancy via appointment, and no logical justification has been offered for doing otherwise.
Elaine Fresco posed a simple question to all Board members: why don't you want Gail and Tina to help choose the vacant seat?
Director Fultz offered further justification for an election. He said he had looked at all the available options and done a lot of research on appointments. The School District hasn't had an election since 2006 [but this is also because nobody has chosen to run]. The 2018 SLVWD appointments led to accusations of cronyism from folks that are now advocating for more appointments. At some point the Board has to stop this. Director Fultz said he was heartened to hear the public concern about spending, but people were failing to distinguish between money that supports the bedrock of our democracy and money spent on a consultant with a slick marketing campaign. Also, he said, there are more voices in the Valley than the ones that have been heard from. He said, “I’m persuaded by the arguments that Rick makes. It’s time to move to a different culture.” He talked about having been elected to bring certain changes and about how “everyone agrees that we have brought a different tone to these meetings” and opened up the committees to more public participation.
Director Farris asked Rick Rogers if he could explain why Staff had recommended that the vacancy be filled via appointment by the new Board. Rick said that the District would benefit from a five-person Board but that he would accept the Board’s decision and wasn’t comfortable saying more.
President Henry said that an appointment actually attracts a broader range of candidates than an election. She said, “If we don't let the two new Board members participate in this decision, we will invite internal problems. I just don't see the logic.”
President Henry allowed two additional public comments. Jim Mosher said he remained befuddled by the idea of having a four-person Board. Gail Mahood summed up the public reaction by saying that the whole conversation absolutely flabbergasted her.
Director Moran moved to order an election, and Director Fultz hastened to add that the District Manager should act immediately on this. The motion passed 3-1 with President Henry voting against it.