MINUTES

The Board of Directors of Brooktrails Township Community Services District met in regular session September 27, 2005 at 7:05 p.m. in Brooktrails Community Center.

A. PLEDGE OF ALLEGIANCE

B. ROLL CALL
Roll call showed the following Directors present: Ziady, Horrick, Pohlson, and Orth. Also present were General Manager Chapman and District Counsel Neary.

REPORT ON CLOSED SESSION
District Counsel Neary stated the Board had met for its annual performance review of the General Manager and the General Manager contract. The Board voted unanimously to renew the General Manager's contract for one year (September 28, 2005) at a yearly salary of $68,328.00.

C. ADDITIONS/ADJUSTMENTS TO THE AGENDA
None.

D. MINUTES OF PREVIOUS MEETINGS

1. September 13, 2005 – Director Horrick moved to approve the minutes; Director Pohlson seconded and the motion carried unanimously.

September 17, 2005 – President Orth noted that the acronym ETA in paragraph 3 on page 3603 should read "EPA," and on that same page, last paragraph, the last two sentences should read, "President Orth said that CDF has finished our abatement program with a quarter-million dollar grant in those suburban interface areas. He said he would like to see some neighborhood meetings next year. . . ." Director Skezas moved to approve the minutes with those changes; Director Horrick seconded and the motion carried unanimously.

E. SPECIAL PRESENTATION
None.

F. PUBLIC HEARING
None.

G. PUBLIC COMMENTS
Art Eck, l623 Padula Drive, following up from his comments made at the Community Forum meeting, presented his proposed parking ordinance to the Board, which he initially presented in 2002 and has since updated. He distributed copies to the Board. He said it was enforceable according to a CHP officer. He said the only cost would be to distribute the copies to all the residents, and he asked the Board to pass the ordinance. President Orth noted that the District was not in charge of County roads; however, a full discussion of parking would be on a future agenda for the benefit of the incoming director.

H. CONSENT CALENDAR

2. Review of Accounts Payable Report and authorization to issue checks. Director Skezas moved to approve payment of the accounts; Director Horrick seconded and the motion carried unanimously.

3. Approval of Special Accounts Payable (Clearwell/Backwash Ponds Project). Director Skezas moved to approve payment of the accounts; Director Horrick seconded and asked when the project would be completed. General Manager Chapman said it was 40% finished now; completion will be in March 2006. The motion carried unanimously.

4. Flynn/Austin greenbelt exchange – finalization. President Orth produced an alternative design diagram for the greenbelt exchange area driveway in question. (This diagram will become part of the record.) He wanted the square box indicated in his diagram to be preserved by easement so that Ms. Austin's architect could design an appropriate entry through that area in future. All parties and the directors reviewed and discussed the alternative approaches for parking between Ms. Austin and Ms. Flynn.

Mark Ranft, Ms. Austin's attorney, said they were not ready to proceed today. However, he said President Orth's diagram seemed appropriate and asked that any deed the Board prepared for Ms. Flynn recognize that easement for turnaround and egress. President Orth said until Ms. Austin did a land trade for a portion of greenbelt to make the diagram possible, she was limited to her own land for parking. He said the arrangement should travel with the property. Director Pohlson agreed that both parties should have the opportunity on their own timetables to do this; she further expressed that there be no parking on the other party's lot, only access and egress. She said both parties need to be courteous to the other and respect each other's privacy.

Ms. Flynn said she was very disturbed by this change, after months of discussion. She noted this proposal had never been discussed before. She stressed that this proposal would negatively affect her view, but not Ms. Austin's. She feared this proposal would reduce the space she had for a planned garage. President Orth said they were trying to get Ms. Flynn's project moving, even though there was no proposal from the other party. Ms. Flynn said she had earlier agreed to allow turnaround, but now something completely different was proposed. President Orth said that access in this manner had in fact been mentioned at the prior meeting. He reviewed the diagram with Ms. Flynn again, to show her that the proposal was an extension of the same easement. He pointed out that Ms. Flynn could put up a fence for visual screening after Ms. Austin completed her project, and said such a fence will be part of a required design review process.

Director Ziady said she did not understand Ms. Flynn's complaint about people driving past, because Ms. Austin already had an easement and this traffic already occurs. Brief discussion ensued about changing the course of the easement. President Orth noted that a setback variance could be involved via the Board. Mr. Ranft was concerned that there would not be enough room for an adequate turnaround. President Orth pointed out that the turnaround area indicated needed to be preserved by Ms. Flynn as a "no build" area, but parking still would not be allowed on it. Ms. Austin said she was concerned about keeping the trees; President Orth said the District Architect shared this concern. President Orth said the matter would be sent to staff to create a final document for approval.

Bill Barksdale, Ms. Flynn's real estate agent, mentioned areas of geologic instability alongside the properties which have been since stabilized by Ms. Flynn's efforts over the years. Director Pohlson moved to grant Ms. Flynn the ability to make the proposed lot trade and to have staff return with a document utilizing President Orth's drawing to finalize this. Director Horrick seconded. Bill Barksdale asked if Ms. Flynn could proceed to close on the trade lot. President Orth said this motion approved her doing that. Roll call vote was as follows:

AYES: Directors: Ziady, Horrick, Pohlson, Skezas, Orth
NOES: Directors: None
ABSENT: Directors: None

Ms. Flynn and Director Skezas consulted about her next availability in Brooktrails. Ms. Flynn thanked the Board. General Manager Chapman said it would take at least 30 days to prepare the document for finalizing.

5. Release of District Counsel opinion –Willits Sewer Plant capacity. Director Skezas moved to release the opinion; Director Ziady seconded. The motion carried unanimously. District Counsel Chris Neary said the District should pay strict attention if there were any substantial annexations to the City of Willits, and be prepared to comment. Also, he said, there might be some economies of scale if we coordinated with the City of Willits when establishing the empirical data for sewer development fees. General Manager Chapman noted we have 54 miles of sewer lines compared to Willits' 24 miles and he felt we should explore this concept. Discussion followed. The board directed staff to look into the sewer development fee coordination idea. Director Pohlson felt it was appropriate to invite the City to work with us on sewer and overall development, given the current project and rate changes they are about to embark upon.

6. Consideration of lot donation – Richard & Alida Duffy. President Orth asked how lot donations would be handled in future should a Proposition 218 assessment be attached to the lot. District Counsel Neary said that any 218 election should have a foundation on the Specific Plan, which anticipates a lot reduction program and acquisition by public ownership. President Orth said he understood that, but wondered if we would not be able to accept donated lots if they had a bonded assessment. Right now, he pointed out, they just have our water/sewer assessments. General Manager Chapman said this would be a question for our experts. President Orth noted that we should begin to collect such questions.

Director Skezas moved to approve Resolution 2005-21 accepting the lot donation from the Duffys; Director Pohlson seconded. Roll call vote was as follows:

AYES: Directors: Ziady, Horrick, Pohlson, Skezas, Orth
NOES: Directors: None
ABSENT: Directors: None

7. Consideration of 300' sewer line repair on Peacock Road. General Manager Chapman said District crew had found a damaged line section this summer via our camera program. While this could be done as an in-house project, he would like to hire an independent contractor, Casey Furlong, for part of the excavation itself, at an estimated cost of $5,000.00. As usual, total costs will depend on what is found underground once the digging begins. Discussion among directors led to direction that the type of pipe to be used should allow for expansion, given that it was in a seismically active area. Director Skezas moved to approve the Peacock Road repair to a maximum of $15,000.00. Director Pohlson asked if safety scaffolding would be used for this project (8' depth) and inquired about whether we have enough for safety. Mr. Chapman said he would check that out, and pointed out that Mr. Furlong has his own backhoe. Director Pohlson seconded the motion. Roll call vote was as follows:

AYES: Directors: Ziady, Horrick, Pohlson, Skezas, Orth
NOES: Directors: None
ABSENT: Directors: None

8. Financial discussion of readjusted numbers regarding Golf Enterprise Fund and Fire Fund adjustments into General Fund for June 30, 2005. General Manager Chapman cautioned that this would be a complex subject and discussion. Terry Krieg, CPA, the District's auditor, in a letter received September 12, 2005, said he was dissolving the Golf enterprise fund and adjusting our Golf operation into the General Fund. This dissolving of the enterprise fund was done because an enterprise fund typically has a revenue base that can substantially offset costs, and we did not have revenues in the golf course because those operations were transferred to Ron Runberg in 2004. Mr. Krieg's adjustment significantly impacted our General Fund from approximately $178,000.00 down to $45,000.00, and further ERAF impacts reduced the General Fund to a minus $2,700.00. This change was not proposed last year when the auditor reviewed our financials, and last year's decision to hire a fire prevention officer immediately after the fire tax increase was passed was predicated on the General Fund being approximately $178,000.00. Additionally, the ERAF shift of $116,000.00 over two successive years has hurt the General Fund dramatically. Mr. Chapman said his main concern was the need to approach USDA within the next 12 months for funding for a rubber spillway, and USDA was concerned with finances across the board, rather than just with cash flow in the water department. He clarified that the auditor's change was to be effective June 30, 2004. Mr. Krieg is currently doing two years' audits at the same time due to the delay in receiving figures from City of Willits.

Director Skezas said he did not agree that we should be closing down the golf fund, because our contract does call for potential profit-sharing later. He said we have rejected auditor recommendations in the past. He discussed with Director Pohlson that, despite no income over the course of several years, there could be income in the future. General Manager Chapman said the District bookkeeper cannot close books for July, August and September, until this issue is settled. He then presented a transparency showing past transfers between funds involved for FYs 2002-03, 2003-04 and 2004-05. The ERAF shift prevented expected transfers from taking place that were planned in the budget. He then advised we are discussing with the County and District Counsel whether our ERAF calculation was properly calculated (ad valorem vs. assessments). He noted Director Skezas' comment of our current $91,000 in cash in the General Fund. He said he may bring to the Board the question of possibly changing the payment schedule for the sewer loan, currently on a 30-year plan. Director Pohlson said she would like to see the letter from Terry Krieg. Director Skezas asked for the history of the $71,000 cash deficit in golf and water. Director Skezas said he questioned our debts between funds past year-end. Mr. Chapman said the issue was when the General Fund drops into the red, which was never envisioned when the transfers were made, but it is now. He pointed out also that he did not know a year ago that his General Fund was going to be cut from $178,000.00 down to $45,000.00 down to minus $3,000.00.

Mr. Chapman noted that a week ago, Mr. Krieg had also wanted to put the Fire Department negative balance into the General Fund, which would have taken it to a minus $103,000, but has since changed his mind about that when he learned that the fire tax increase will increase Fire Department revenues from approximately $160,000.00 to $275,000.00 annually. Mr. Chapman said he cannot back up and change the numbers on June 30th at this point, but we certainly can fix this problem in the near future. Next year, he commented, we are not going to be hit over the head like we have experienced with the golf one-time adjustment. He said where he did not completely connect the dots that Mr. Krieg planned to place the golf assets into our 800 capital account ($721,000 plus), but the liabilities into the General Fund. He said the only good news was that our cash flow has not been dramatically affected, but we are going to have to get out of this box. He again reiterated the potential effect on a future loan, and said perhaps the existing loan payment schedule should be accelerated.

Mr. Chapman said that Terry Krieg will appear at the next meeting to present his views, and then staff will prepare a report on recommendations.

9. Consideration of Estabrook report recommended updates. General Manager Chapman said he felt Richard Estabrook's report at the last meeting was excellent and he wanted to put the amended figures on the website. Director Skezas moved to accept and file the report; Director Horrick seconded. Bob Terry asked if it would be useful for people to know the current development figure today and was advised it is 1,511. The motion carried unanimously.

K. SPECIAL REPORTS
Directors: None.

District Counsel: Mr. Neary said he was working on an opinion relating to the interrelationship of the maintenance districts.

General Manager Chapman: Mr. Chapman pointed out that he had attached to his report a letter of thanks to our fire department for their activities in the recent fire.

L. PUBLIC COMMENTS
Mr. Terry updated the Board on CERT discussions with the County, which has agreed to underwrite some training materials. BPOA will sponsor purchase of a laptop and digital projector. President Orth suggested that CERT appear on the agenda of the Recreation, Greenbelt & Conservation Committee regarding neighborhood meetings. Director Pohlson wanted a statement on the internet suggesting that the District would be coming out of the moratorium at approximately 1,511. [Note: This decision would be made by DHS, not Brooktrails.]

M. ADJOURNMENT
Director Pohlson moved to adjourn and President Orth declared the meeting of September 27, 2005 closed at 8:26 p.m.


CHARLES A. ORTH
President Orth


MICHAEL V. CHAPMAN
Secretary to the Board of Directors