MINUTES

A. PLEDGE OF ALLEGIANCE

B. ROLL CALL
Roll call showed the following Directors present: Eads, Whitney, Estabrook, Orth and Skezas. Also present were General Manager Williams and District Counsel Neary.

C. ADDITIONS/ ADJUSTMENTS TO THE AGENDA
None

D. MINUTES OF PREVIOUS MEETINGS

January 26, 1999

1.Director Orth made a motion to approve the minutes of January 26th as written. Motion seconded by Director Estabrook and the vote was taken as follows:

AYES: Directors: Eads, Whitney, Estabrook, Orth, Skezas
NOES: Directors: None
ABSENT: Directors: None

E. PUBLIC HEARING

2. PROPOSED WATER RATES ADJUSTMENTS. THE GENERAL MANAGER FILED A REPORT IN DECEMBER SUGGESTING AN ADJUSTMENT TO THE EXISTING WATER RATES TO PROVIDE FOR NEEDED CAPITAL REPLACEMENT. PURPOSE OF THE HEARING:TO TAKE PUBLIC TESTIMONY.
General Manager Williams explained that when the annual report on rates and fees was presented in October we expected to be able to hold off on an increase in water rates this year. It was expected that the refinancing of long term debt would enable us to utilize current reserves to carry us into the next year. Because we were unable to do so, we filed a report in December suggesting a number of options to adjust the current water rates. The Board selected from those options and public notices were posted, mailed to all users of the system, and published in the Willits News.

With the aid of an overhead projector he explained that the largest fund in terms of both revenues and expenses is the Water fund. In addition to depreciation and needed capital replacement, there has been a 10% increase in costs over the last three years related to water usage. He reviewed the list of recommend capital replacement items and the revenues needed to fund to them and explained how the proposed rate increases will affect the annual revenues.

It was noted that two pieces of correspondence had been received, one in favor of the proposed rate increases, and one stating concern about the Y2K issue.

At the conclusion of the General Manager's presentation, President Skezas opened the public hearing at 7:24 p.m.

John Bothwell voiced his concern that the notice mailed to the water customers contained an error in the figures listed as the existing rates for the third and fourth tiers. He agreed that the District is in need of money, and felt that it should have been part of the budget discussions last year. Also, he disagreed with the Board's decision to commit funds to the county for road studies.

No other members of the audience came forward to speak so President Skezas closed the public hearing at 7:34 p.m.

Director Eads asked for clarification of the error in the notice dated December 22, 1998 which was mailed to all users of the water system. It was pointed out that there was a zero omitted after the decimal point in the existing rates in the third and fourth tiers. It would appear that the rates for those tiers were actually going down. This was brought to the attention of the District Counsel, who felt that because the new rates were correct as listed, it was not a defective notice.

Director Eads then asked what impact the Y2K issue will have on the next budget. General Manager Williams answered that replacement of two computers is scheduled for this fiscal year and the remainder of the computers will be addressed in the next fiscal year's budget. All computers will be Y2K compliant prior to the end of 1999.

Director Orth pointed out that a sinking fund was set up some time ago for the sewer system, which is paid for by tax dollars. The proposed rate increases will begin the same process for the water system. He assured Mr. Bothwell that it is not the District's intention to get rich but only to be able to maintain the quality of the water supply.

President Skezas commented that this should be the last major rate change, beyond cost of living increases, and that it will bring us in line with where we need to be to accumulate necessary reserves.

F. PUBLIC COMMENTS

Robert Terry inquired about an E-mail which was sent by Aubry Maynard to Board members and the District office concerning dumping problems and proposed standards for trash collection. General Manager Williams replied that the correspondence had been forwarded to the solid waste Franchisee for recommendation. Director Estabrook suggested putting the item on a future agenda to get input from the public on enforcement and funding.

G. ACTION AGENDA

3.CONSIDERATION OF CALLING FOR BIDS FOR THE USE OF CONTRACTORS TO WORK IN THE GREENBELT.

General Manager Williams stated that, as reported in November, we are looking at 2 specific areas of Greenbelt for a pilot Vegetation Management Program.

CDF is in the process of developing an EIR on vegetation management which includes areas like Brooktrails. In order to conform to their program we would be utilizing CDF foresters to lay out a plan for what would be appropriate here, with regards to the terrain and the management of species. We would like to supplement the CDF and CCC crews with private contractors, using the sale of firewood to cover their costs. If that were not sufficient, the bids would be presented to the Board as a part of the development of the annual budget. A draft contractor's bid package was presented for the Boards review and comment.

Director Eads commented that, according to the District Counsel's opinion, this activity appears to be exempt from the EIR. He felt that any work done around our watershed would have an affect on the environment.

Director Whitney wanted the public to understand that this work would not be like a lot abatement, it would be only to clear dead vegetation and reduce fire hazard, live trees six inches in diameter or greater would be left. With regards to the proposed bid package, he recommended that each contractor bid on a designated area, a sample area be marked, and the projected time period be more definitive. He also felt that Exhibit A, Item "b" under

"Project Description" the words "enhancing the development of appropriate species" be replaced with "vegetation health"; and that under "Projected Payment" we not exclude possible income from other wood products, and "specific per hour charge" be changed to "lump sum bid."

Director Estabrook commented that he was uneasy calling for bids to come up with an estimate, and would prefer to use figures from recent lot abatement programs to estimate the cost of this program. He would also like the overall general health of the forest be taken into consideration along with the fire abatement, issues such as wildlife, promotion of native plant species, and erosion control.

Director Orth expressed his agreement with the need for "all species management." He felt that because of the amount of work being done by CDF crews, the increase in the staff of CDF foresters which will assist with planning in areas such as Brooktrails, and the impact on the budget, that establishment of this program may be premature at this time.

It was suggested that the Staff walk through the area with one of the local contractors, review the work done on Ridge Road, which is of comparable terrain, and bring this item back to the Board for further consideration at a later date.

4.REVIEW OF THE ANNUAL RECONCILIATION OF CHARGES FOR SEWER BY THE CITY OF WILLITS.
General Manager Williams reviewed the Annual Reconciliation of Charges for Sewer by the City of Willits with the Board. He explained that the District

had accrued an arrearage to the City because of a delay in receiving an audit for five years, during which time the District continued to pay the same amount. Once the audit was received the underpayment became evident. The District has reduced the amount owed to the City of Willits by $40,000 this fiscal year. He commented that co-operation between the City and the District continues to be good which makes the annual report go smoother every year. President Skezas declared the report received and filed.

5.DISCUSSION OF THE ANNUAL PLANNING MEETING

Director Whitney asked that the Willits Bypass issue be added to the agenda for the annual retreat. After some discussion it was decided that Lena Ashley from CalTrans would be invited to speak to the Board at the regular meeting of February 23rd, and after her presentation it would be decided if the item would be added. The Board did commit to add to the agenda a review of existing resolutions that express the District's position on the issue. The draft agenda was approved with the change.

6. REVIEW OF THE SECOND MOCK-UP OF THE 1999 NEWSLETTER

Director Orth thanked the General Manager for including an article on water conservation.

Director Whitney presented a letter in which he asked that the District include its website address. General Manager Williams commented that he will move forward with the establishment of a website so that the address can be included.

Director Estabrook thanked the General Manager for including his comments on the seeking of lot owners interested in helping to maintain the Greenbelt.

It was decided that the term "4-Wheel" in the center of the back page should be re-worded to reference "off-road vehicles", and that the notation that it is a misdemeanor be added, as well.

H. SPECIAL REPORTS - THE GENERAL MANAGER.

i. Significant Correspondence received since last meeting:

District Counsel Neary had provided copies of correspondence documenting his attempts to remove his address from the property tax bill for properties owned by Old Holdings Ltd.

ii. Personnel
General Manager Williams informed the Board that he will be absent from the District February 18 - 20 and that Wendell Wilson will be acting General Manager during that time.

 iii. Finance

Warrants for January and current Accounts Payable were reviewed by the Board. Director Whitney asked if the Cash Flow chart included the change anticipated in the water rates to which General Manager Williams replied that it did not.

iv. Planning

The Breakdown of Activity within the District was reviewed. General Manager Williams pointed out that a new connection had been added and the format had been changed to include more information previously requested by the Board. Director Whitney expressed his appreciation for the changes.

v. Possible upcoming agenda items

vi. Other

I. PUBLIC COMMENTS

Robert Terry asked if the BPOA could have a paid advertisement in the upcoming newsletter. General Manager Williams pointed out that it already contained an ad for the availability of the community center. President Skezas left the feasibility of paid advertising up to the discretion of the staff.

J. ADJOURNMENT
Director Orth moved to adjourn and President Skezas declared the meeting of February 9, 1999 closed at 9:01 p.m.

PAUL A. WILLIAMS
Secretary to the Board of Directors

GEORGE C. SKEZAS
President