CRANE LAKE WATER & SANITARY DISTRICT (CLWSD)

BOARD OF MANAGERS’ REGULAR MEETING

June 6, 2007 – 7:30 P.M.

CRANE LAKE CHAPEL FELLOWSHIP HALL

The meeting was called to order by Chairman Rob Scott at 7:30P.M.

Members present: Managers Dave Adams, Bill Congdon, Rob Scott and Mike White.

Members absent: Darrell Scott

Also present: John Jamnick of RLK-Kuusisto, Jim Pohlman of NTS, Clerk/Treasurer Jo Ann Pohlman, representatives from the Cook News-Herald and Voyageur Sentinel, and 5 members of the community.

BUSINESS:

Opening Comments: Chairman R. Scott relayed to the public that Laurie Brown of the U of M Extension Service, who has been working with the ESA Advisory Committee, will be unable to assist the Committee and the Board this summer season as she will be on medical leave. Laurie has provided contact points for the Board and the Committee in her absence. The Board wishes her the best and looks forward to working with her again soon.

A motion was made by D. Adams, supported by B. Congdon, to approve the minutes of the Regular Meeting of May 2, 2007. All voted in favor and the motion carried.

The correspondence was presented to the Board. A motion was made by D. Adams, supported by B. Congdon, that the correspondence be placed on file and acted upon as required. All voted in favor and the motion carried.

Clerk/Treasurer J. Pohlman presented the April 2007 Financial Reports to the Board as reviewed by the Glorvigen accounting firm, including a 12/31/05 Balance Sheet to compare to the recently received audited financial statements for that year. The reports and invoices-on-hand were reviewed with the Board. The Board agreed that there was no need to receive levy monies on the early distribution date of 6/21/07 rather than 7/5/07 as presented as an option by St. Louis County. Chairman Scott added that the results of the 2005 Audit were acceptable with no discrepancies found. He also added that a letter had been sent to NTS asking for amplification of the invoices related to the freezing incident. A motion was made by D. Adams, supported by B. Congdon, to approve the Treasurer’s Report as presented and the payment of bills as follows with the exception of NTS Invoices #07-02634, #07-02633, and #07-02635 amounting to $69,319.08, which are being reviewed for insurance claim purposes. Administrative: Glorvigen - $100.00; Costin Group - $250.00; Fryberger Buchanan - $1,017.22; Mike White - $346.58; and RLK-Kuusisto - $287.50 & $320.00. Operations: Lake Country Power - $76.75 & $1,008.92; NTS - $3,639.75; Hawkins - $1,481.04; One Call Concepts, Inc. - $1.45; and Nagurski - $212.09. Project: Cope & Peterson - $122.00. All voted in favor and the motion carried.

Administration

· Increased Insurance Coverage: The lift station and grinder pumps were added to the insurance policy for coverage at additional cost. R. Scott will look into the necessity of main line coverage as well as the cost per grinder pump for coverage.

· July Meeting Date Change: The first Wednesday of July is the 4^th. The CLWSD Board of Managers’ meeting will be changed to the following week on a day yet to be determined.

· Emergency Response Plan (ERP): RLK & NTS are reviewing the ERP to include the recent updates to the plant. The report will be sent to the MPCA by the end of June.

· Capital Asset Plan: Jennifer Hanson of the Glorvigen Accounting Firm will provide the plan upon comparison to the Duluth/North Shore Sanitary District’s plan, which she feels would be an appropriate model for the District to follow and which is being currently updated. She will be communicating with the Duluth District this week.

· Lake Shores Meeting Report: D. Adams and B. Congdon will report at the July meeting.

· MRWA Workshop Reports: Both M. White and B. Congdon thought it was a good seminar and felt the speaker, Carl Brown, knew his subject well. B. Congdon reported that Mr. Brown said most districts were not charging enough. R. Scott appointed B. Congdon and M. White to the Financial Committee to work on the budgets for 2008.

Financial (EFG, Costin, RLK)

· RD Loan Relief: A letter was sent to Steve Wenzel of Rural Development requesting loan relief. No response has been received to date.

· Grant Funds: Gary Cerkvenik of the Costin Group continues to pursue grant funds for the ESA project. B. Congdon suggested that he be asked to also address the RD loan relief.

CLWSD Meeting Minutes – June 6, 2007

Financial (EFG, Costin, RLK) (Cont.)

· Clean Air Act: State Representative Dill will continue to address this funding issue, which is considered in even numbered years.

· MPCA Funds: there are Corrective Actions Funds available from the MPCA. R. Scott and John Jamnick will pursue this concept to see if there is possible application to the freezing issue.

Legal Issues (MFS, EFG, RLK)

· Ordinance #3: A revised draft of Ordinance #3 was received from Fryberger, Buchanan. The Board discussed the Ordinance. Chairman Scott asked for a resolution to approve the revised Ordinance #3. A motion was made by D. Adams to approve the following resolution: “Resolved that the amendments to the Crane Lake Water and Sanitary District Ordinance No. 3 are hereby approved.” The motion died for lack of a second. Ordinance #3 was tabled until the July meeting.

· Litigation: R. Scott informed the Board that an email was received from Mr. Jeffrey Egge, attorney for the League of MN Cities informing him that a complaint had been placed in line for service on RLK, Rice Lake Construction, and Nelson Collie Electric in relation to the freezing issue.

· Bear Island: R. Scott contacted Fryberger, Buchanan for advice on the petition to vacate the roadway known as Highland Entrance located within the Plat of Big Bear Island. The concern of the District would be if the roadway were vacated, could it be used for utility purposes should the District need if for future sewer access. Three options were provided by Fryberger, Buchanan: 1) Prepare a letter to the Judge expressing concerns relating to the vacation of the platted road and its effect on the District’s plans to expand into the ESA. 2) File a Motion to Intervene in the pending court action. 3) Contact the Attorney for the Petitioners regarding a possible agreement for a utility easement. A motion was made by B. Congdon, supported by D. Adams, to request Fryberger, Buchanan to contact the Attorney for the Petitioners regarding a possible agreement for a utility easement. B. Congdon, D. Adams, and R. Scott voted in favor; M. White abstained. The motion carried.

Sewer Freezing Issue Review and Elevated Pump Readings (NTS, RLK)

• Permanent Fix: J. Jamnick presented a draft handout to the Board for consideration. The Board discussed the plan. R. Scott stated that three areas needed to be addressed: Hardware, Operations, and an Emergency Plan should freezing reoccur. A committee meeting may be arranged to advise the Board of the direction that should be taken.

Eastern Service Area Update (U of M, RLK, NTS)

• Action Items: A motion was made by B. Congdon, supported by D. Adams to approve the preliminary action items list. The Board discussed other possible action items that may be added to the list before finalization for Advisory Committee consideration. All voted in favor and the motion carried.
• ESA Action: The Board responded to questions and concerns presented by M. White for ESA actions as follows:
• Preliminary Engineering Report: Establish an action item to determine projected volumes by type of user and economic development effects. Key assumptions should also be compared to actual experience in the first three years of operation in the WSA. Tabled.
• Long Term Debt: Decide if CLWSD can afford additional debt as it would have a major impact on future rate determination activities. Additionally, advise all property owners within the CLWSD District of the CLWSD Board’s position on long-term debt. A motion was made by B. Congdon, supported by D. Adams that the Board is willing to look at more long-term debt to match to possible grants received. B. Congdon, D. Adams, R. Scott voted in favor; M. White abstained. The motion carried.
• Current On-Site Systems: Decide on the Board’s decision regarding on-site systems within the ESA that are currently operating in compliance with St. Louis County standards. A motion was made by B. Congdon, supported by D. Adams, to give ESA properties the option to stay as they are or to abandon and be covered by a District management plan. B. Congdon, D. Adams, R. Scott voted in favor; M. White opposed. The motion carried.
• Barging Costs: Decide on how to best advice all CLWSD property owners the proposal to utilize a barge to transport wastewater to the existing WSA treatment facility. This will result in a barging premium expense and whether this expense will be borne by users of the barging service or shared by all users of the treatment plant. The Board determined that costs should be discussed with the Advisory Committee.
• Rate Structure: Decide if the current rate structure needs to be modified to include a seasonal rate for seasonal users. The Board agreed to revisit this issue with future budget discussion.
• ESA Advisory Committee: Determine if the Board has not considered the ESA Advisory Committee’s recommendations. The Committee will be asked to provide a list of recommended actions not acted upon by the Board.

CLWSD Meeting Minutes – June 6, 2007

RLK Engineering Status (RLK)

• Hoff Easement: Easement needs to be recorded.
• Lake Shore Estates Modifications: J. Jamnick provided a letter written to the Board regarding Lake Shore Estates dated 6/6/07. The letter stated that J. Jamnick had met with Mr. Bob Braaten regarding the development of Lake Shore Estates. A hand sketch of the utilities was provided by Mr. Braaten. J. Jamnick did not have a recommendation for the Board until a request for modification is received from Lake Shore Estates.
• DeFries Tank: Plans are in line to begin the correction work.

• Punch List: Items remaining will be addressed by RLK. J. Jamnick will communicate with Mike Seigley on the punch list items related to his property.
• O & M Inputs: NTS will not be renewing their contract with the District. J. Jamnick has scheduled a meeting for 6/7/07 to review the plant and its operation with a possible operator. A fee proposal will be requested. A motion was made by M. White, supported by B. Congdon, to approve RLK’s recommendation to bring a Class A operator on line for 90 days with a follow-up meeting to be arranged with the Board. All voted in favor and the motion carried.
• WSA Expansion: A letter was received from a concerned citizen inquiring why the government agencies in Crane Lake don’t have public restroom facilities at the public landings. RLK will look into the possibility of the government entities providing the public lands providing restroom facilities for the public, other than outhouses.

Operations Report (NTS)

• Jim Pohlman reported that all discharge standards were met for the month with no bypasses or overflows. Grinders and rails are being checked to be sure they are in working order.
• Quality Flow Cost Proposal: Quality Flow’s cost proposal for lift station calibration is still being considered.
• Rails have been ordered for replacement at the Stahnke and DeFries properties.

PUBLIC COMMENT (5 Minute Limit)

Feno Rainaldi understood that the ESA Advisory Committee had recommended cluster and ISTS systems and questioned why the Board was looking for a grant for barging purposes. The Board responded that different options would be considered for different locations as the ESA was quite diverse.

Bob Kaiser, Chairman of the ESA Advisory Committee, stated that the Committee did not feel that the Board had acted upon their recommendations and clarified that the grant request is worded to run barging. He agreed with the Board that the Committee should meet with the Board to clarify issues. He also clarified that the Committee did look at all aspects of the ESA, not just East Bay and Bear Island.

Feno Rainaldi asked about the word ‘Tasking’. Assignment could be used as a description of the word tasking.

There was discussion of changing the name of the ESA to better describe the diversity of the area.

Feno Rainaldi questioned if it was wise to use a grant should it be granted.

Charlotte Bystrom said that she had not seen the Advisory Committee’s report. The report is on the CLWSD website, on the Bulletin Board. Anyone wanting a copy of the report may request it. She also mentioned that the increases on property taxes this year were in great part due to the District’s administrative expenses and that she felt the taxes were becoming a reason for people to leave the area. She also asked if NTS would be responsible for all the automation placed in the plant for their use. The automation will be able to be used by another operator.

Bob Kaiser stated that the Committee has waited for a year for a response from the Board and that they do not care for the word Tasking.

The meeting was adjourned at 9:30PM.

J. Pohlman, Clerk

NEXT MEETING: DATE TO BE DETERMINED, 7:30PM, CRANE LAKE CHAPEL FELLOWSHIP HALL

This draft of the CLWSD minutes has been posted solely for preliminary informational purposes. Minutes are unofficial and subject to change until they have been approved by the CLWSD Board of Managers.