CRANE LAKE WATER & SANITARY DISTRICT (CLWSD)

BOARD OF MANAGERS REGULAR MEETING

March 3, 2004 – 7:30 PM

CRANE LAKE CHAPEL FELLOWSHIP HALL

The meeting was called to order by Chairman Michael White at 7:30PM.

Members present:  Managers, Bud Bystrom, Deena Congdon, Darrell Scott, Rob Scott and Mike White.

Members absent:   None

Also present:  Jim Pucel of RLK-Kuusisto Ltd., Clerk Jo Ann Pohlman, a reporter from the Cook News-Herald, reporters from the Voyageur Sentinel and 5 members of the community.

BUSINESS:

Motion by R. Scott, supported by D. Scott to approve the minutes of the Regular Meeting of February 18, 2004.  Motion carried.

Chairman M. White reviewed the Treasurer’s Report.  A motion was made by D. Congdon, supported by D. Scott to approve the February Treasurer’s Report and the payment of the following Administrative bills:  RLK-Kuusisto – $792.50; Midwest Captions – $120.00 and Frontier – $112.14.  Motion carried.  Project bills will be paid with the next project payout submittal.

Correspondence

• The correspondence was presented to the Board.
• A motion was made by D. Congdon, supported by D. Scott that the correspondence be placed on file and acted upon as required.   Motion carried.

RLK-Project Status Report

• Construction-Wastewater Collection System – Wagner submitted a proposed construction schedule with mobilization of equipment beginning prior to March 15^th. Pressure testing of previously installed lines would begin in mid-April. Final connection to the discharge line would be done around April 19^th.   They would begin with one crew and add another soon after.  They plan to install two service lines and two grinder stations per day beginning in mid-May.  Wagner will be available to complete the connections from homes to the grinder stations.
• B. Bystrom raised the question of debris in the pipelines. A request was made that RLK review this issue with the inspectors with a written response being sent to the Board.
• Construction-Wastewater Treatment System – Rice Lake submitted a revised construction schedule with work resuming in mid-March.
• Open issues remaining are the recording of the plat, biosolids disposal and Engineering Agreement Amendment No. 2.
• The Board requested detailed information on the Engineering Agreement Amendment.  The Amendment will be divided to show detail on additional dollars for labor, and additional dollars for inspection during construction to be tied in with the construction schedule.  RLK will provide information for the Amendment at the next meeting.

2004 Construction Schedule

• R. Scott reported the purpose of the Service Connection and Installation Planner was to identify and track issues related to the process of getting individual sewer systems operational and connected to the treatment plant.   It will also be used to assist landowners in planning and individual responsibilities.
• The Contractor construction schedule will be needed to develop the installation planner.
• The connection of grinder tanks to the sewer system will involve three things:  Connecting the sewer piping for landowner buildings to the grinder tank, electrical wiring for the grinder pumps, and vacating existing septic systems.
• R. Scott will continue to work on this issue.

Eastern Service Area Plan

• J. Pucel said that the Preliminary Engineering Report draft for the ESA was submitted to the MPCA and that the project has been submitted for placement on the Project Priority List (PPL).  This is the first step in securing funding for the Project.

Financial Plan & Ordinance Requirements

• Scott Harder was unable to attend the meeting as planned.
• Mr. Harder submitted a draft letter to M. White, which was reviewed with the Board.
• M. White and R. Scott have been working with Mr. Harder.
• M. White reported that he received the following update from Scott Harder:

Rate Schedule Update

• A minimum charge that addresses the fixed and non-variable costs of operating, maintaining, and financing the wastewater collection and treatment system for defined classes of customers.  Total costs in 2005 are currently estimated to be $134,450 including operations, maintenance, an interest-only loan payment and a small provision for renewals and replacements.  This will increase to $148,473 in 2006 when the first principal payment is due on the USDA loan.  Fixed costs in 2005 are currently estimated to be $101,550. Less $42,700 in expected special assessment revenues, that portion of fixed costs that will need to be recovered from minimum charges is $58,850.
• Defined customer classes that reflect the size of the grinder pump station and expected flows and loads from customer assigned to each class.  These will include a single residential class and multiple commercial classes, as is common practice in wastewater utility management.
• Required payment of minimum charges by all customers, whether season or not.  (Seasonal residents would of course not pay volume charges when they are not present in Crane Lake since their dwelling and businesses would not generate wastewater flows.)
• A uniform volume charge that addresses the variable costs of operation and maintenance.  In 2005, variable costs are estimated to be $32,900 and include chemicals, utilities, and biosolids disposal.

Overall Financial Plan

Key parts of the financial plan for the wastewater collection and treatment project are largely in place.  Its major components include the following.

• Special assessments that will generate $42,700 per year.  These revenues will be used to pay off a portion of the USDA loan payments each year.  These special assessments will be paid only by those customers who are here today. These existing customers will not pay a hookup fee.
• Hookup fees charged to new connections to the system.  These hookup fees should be established at a dollar amount sufficient to pay grinder, service line, and a share of backbone and treatment facility capital costs.  These fees are payable upfront.  Hookup fee revenues should be used to pay a portion of annual USDA loan payments and additional principal payments in order to pay it off early.  These fees should not be used for operations or maintenance.
• User charges to pay operations, maintenance, a portion of annual USDA loan payments, and small provisions for renewals and replacements.

Accounting System/Audit

•  A list of audit documentation requests has been received from Glorvigen.  M. White and J. Pohlman will review the list and provide the needed information.

NTS Contract

• M. White contacted Mary Frances Skala of Fryberger regarding the contract.  Mary Frances is comfortable with the way the contract has been handled and does not recommend that the Board bid the contract.  She cited where other governing bodies have contracted without using the bidding process.

NTS Contract (Cont)

• R. Scott stated a concern about services that are NTS related and services that may be better addressed outside the contract.
• M. Appelwick of NTS has assured the Board that items that could be done locally would be done so.

MPCA  I.S.T.S Grant

• Approval for the Kuder ISTS refund has been received.
• The Sanborn request for refund has been submitted to the MPCA.

Insurance Status Report

• M. White contacted the League of Minnesota Cities regarding lawsuit expenses.  The League informed him that they do not get involved in such matters.  They suggested contacting the CLWSD’s local insurance agent; which was done.
• Copies were made of all legal documents and were sent to the insurance agent, who in turn sent the information to the League of Minnesota Cities.
• The League said, sorry that is not covered by your insurance.
• The CLWSD attorney was consulted.  She agreed that the insurance company’s denial appeared reasonable.
• A motion was made by R. Scott, supported by D. Congdon to approve M. White’s pursuit of collecting court authorized lawsuit costs by alternate means.  Motion carried.

Chapel Use Agreement

• The District has been paying the Crane Lake Chapel $1 per meeting for use of the Fellowship Hall.
• The Board discussed increasing this amount and decided upon $15 per meeting.
• A motion was made by R. Scott, supported by D. Congdon to pay the Crane Lake Chapel $15 per meeting for use of the Fellowship Hall in 2004.  D. Congdon, D. Scott, R. Scott and M. White voted yes.  B. Bystrom abstained.  Motion carried.

911 Sign

• The 911 sign has been received.  There was discussion as to who should place the sign.
• The Board decided the Fire Department should place the sign.

Newspaper Designation

• Two bids were received by the Board for consideration.  One from the Cook-News Herald, and one from the Voyageur Sentinel.
• Gary Albertson of the Cook News-Herald (The apparent low bidder at $2.75 per column inch) assured the Board that the bid amount covered all required CLWSD publications.
• A motion was made by R. Scott, supported by B. Bystrom to accept the Cook News-Herald as the CLWSD official newspaper for the remainder of the year.
• M. White stated that both papers had been faithful in attendance at Board meetings.  He felt the Sentinel would be the better choice as they have a local reporter, their coverage is more extensive and accurate, and it is available to all residents.  The time of publication of the Sentinel coincides with our meetings with delivery at least five days sooner than the CNH.  The Sentinel also publishes CLWSD newsletters, court orders, etc.
• R. Scott did not feel that anticipation of more extensive coverage should be considered and that the CNH has historically served District members.
• B. Bystrom, D. Congdon, D. Scott and R. Scott voted in favor of the Cook News-Herald.  M. White voted against.  Motion carried.

OTHER BUSINESS – None.

PUBLIC COMMENTS

Mike Seigley referred to his previous request for a construction schedule and asked if the current schedule was a final schedule.  R. Scott responded that he is working on the construction schedule and its relation to individual property owners.  More clarity will be available in the upcoming weeks.

Stuart McKie asked when the grinder work would be done on Hilltop Road.  The response was that the timeline is not set but that would be a likely place to begin.  The earliest would be in May.

Mike Seigley asked about metering.  Metering will be used for commercial properties and is still being considered for individual properties.

There being no further business the meeting was adjourned at 8:50PM.

J. Pohlman

Clerk

NEXT MEETING:  MARCH 17, 2004 AT THE CRANE LAKE FELLOWSHIP HALL AT 7:30PM.