For your consideration, please read the minutes from the Commission Meeting held on Thursday, February 15, 2018 at 2:00 p.m.

Commission Meeting Minutes 2-15-18 with Attachments – Approved

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Brunswick-Glynn County Joint Water and Sewer Commission

1703 Gloucester Street, Brunswick, GA 31520

Thursday, February 15, 2018 at 2:00 PM 

COMMISSION MINUTES 

PRESENT:                             

Donald M. Elliott, Chairman

Mike Browning, Vice-Chairman

Cornell L. Harvey, Commissioner

Clifford Adams, Commissioner

Steve Copeland, Commissioner

Tripp Stephens, Commissione

G. Ben Turnipseed, Commissioner 

ALSO PRESENT:                 

Jimmy Junkin, Executive Director

Charlie Dorminy, Legal Counsel HBS

Andrew Burroughs, Deputy Executive Director

Todd Kline, Director of Engineering

Pam Crosby, Director of Procurement

John D. Donaghy, Director of Finance

Jay Sellers, Director of Administration

Cindy Barnhart, T.S.I. 

Chairman Elliott called the meeting to order at 2:02 PM.

Commissioner Copeland provided the invocation and Chairman Elliott led the pledge.

Chairman Elliott requested to add as item 7 under Discussion the Georgia Senate Bill 404 on Fire Suppression.

Commissioner Browning made a motion seconded by Commissioner Adams to add item 7 for Discussion Georgia Senate Bill 404 to the agenda.  Motion carried 7-0-0.

PUBLIC COMMENT PERIOD

Chairman Elliott opened the public comment period.

There being no citizens for public comment, Chairman Elliott closed the public comment period. 

EMPLOYEE RECOGNITION

Certificate Presentation – C. Harvey / C. Barnhart, T.S.I.

 Kenny Hoa Leverett – Water Operator Class III

Commissioner Harvey and Cindy Barnhart presented Kenny Hoa Leverett with his certification for Water Operator Class III.  Commissioner Harvey expressed the duties that this certification authorizes Mr. Leverett to be responsible for. Commissioner Harvey read the certificate aloud, congratulated and encouraged him to continue with his efforts. 

APPROVAL

1. Minutes from the February 1, 2018 Regular Commission Meeting

Commissioner Browning made a motion seconded by Commissioner Copeland to accept the minutes from the February 1, 2018 Regular Commission Meeting.  Motion carried 7-0-0. 

2. Minutes from the February 1, 2018 Health Benefits Workshop

Commissioner Browning made a motion seconded by Commissioner Copeland to accept the minutes from the February 1, 2018 Health Benefits Workshop.  Motion carried 7-0-0. 

3. Five Year Expansion Plan – J. Junkin

Mr. Junkin presented a recap and background information regarding the Five Year Expansion Plans.  He requested the Commission to approve and adopt the Plan as it was discussed in the previous meeting, with notation that if there was a change in the dynamics of the community that dictated to go in another direction or a greater need in another area for it to then be changed at the discretion of the Commission.   Commissioner Turnipseed asked if there is an order for the projects.  Mr. Junkin referred the Commissioners attention to the spreadsheet as provided on the front of the package.  Commissioner Turnipseed confirmed with Mr. Junkin that as the money is available for the projects they will be done in that order.  Commissioner Stephens asked if each of the expansion projects would come to the Commission for formal approval prior to starting them.  Mr. Junkin advised that they would.  Commissioner Browning questioned if the priority as noted on the spreadsheet would indicate the order, and Mr. Junkin confirmed it would and gave the example that “priority 1” would be the first project as the funds are accumulated.  Commissioner Browning commented that he would like it noted for the record that he is all for having a plan in place where as soon as a project is voted on and approved it can be started, and added that he agreed with Mr. Junkin’s presentation and that the board would have input every step of the way as they move through these projects and have the Capital Plan in place.  Commissioner Turnipseed asked about some of the details regarding the first priority Pump Station 4035 and what was to be done to it.  Mr. Junkin advised that at this time that pump station is in fairly poor shape and they would have to upsize it, but that some of the plan for it may change as a result of what is done with the SPLOST Project, depending on the final routing, but as of right now because of the SPLOST Project this is number one.   Commissioner Stephens asked what the score meant and Mr. Junkin noted that as he read it that placed importance on it by the group that did the original Master Plan but that it did not carry any weight in this presentation.

Commissioner Browning made a motion seconded by Commissioner Adams to move that the Plan be approved.  Motion carried 7-0-0.

DISCUSSION

1. JWSC Property Insurance Renewal – P. Crosby

Pam Crosby presented the Liability and Property Insurance Renewal to the Commission. She led the discussion with the background information that every year March 15^th is the renewal date and noted that the next Commission meeting would be attended by Mr. Fred McGinty of McGinty Gordon Associates for the formal presentation of the quoted premiums and request for approval.  For the purpose of this discussion, Mrs. Crosby was providing that background history of the claims in preparation for the next meeting.  She referenced the first document provided which was a recap of the 2016 and 2017 premiums for the General Liability Coverages and the Property, Crime and Equipment Coverage, and then discussed the expected possible increases for each.  The second document she provided for the Commissioners regarded claims history. Commissioner Turnipseed asked if each property was itemized listed separately and Mrs. Crosby noted that each of the treatment plants, buildings and lift stations were listed separately on the schedule of values.  Commissioner Turnipseed commented that at times some of the properties could be overvalued, and Mrs. Crosby advised that an annual survey is performed by Starr Risk Agencies.   She also added that the fleet size increased along with assets such as pumps and these were required to be added to the coverage and caused some increase in the premiums.  Commissioner Browning referenced the previous claims and there was some discussion as to the various types of claims and their values during the previous several years.  Commissioner Browning questioned the percentage of increase last year and this year and if these increases were tracked and determined to be normal.  Mrs. Crosby commented that initially there was not much of an increase expected for this year and that the bid process is out and some of the preliminary numbers have been received indicating that there may be some increases for this year.  Commissioner Stephens asked her when this is due, and she responded that March 15^th is when all of the new policies will go into effect, but that at the next Commission meeting is when the proposal with expected premiums will be brought for approval.  Commissioner Browning asked if the numbers as provided for this discussion are a projection, and Mrs. Crosby advised that this was the baseline and it was expected that the liability coverage could go up 3 to 5% and the property could go up 8 to 10%.  Commissioner Stephens asked if this had been reviewed to be sure that insurance values are as appropriate.  Mrs. Crosby noted that every year a new schedule of values is provided, and also Starr Risk Agencies comes in and does inspections of the facilities to ensure that the property values are in line.  She noted the additional types of coverages that might be considered after the March renewal, such as Cyber Liability Coverage and “Parametric” Coverage of which she provided an explanation and example of.  Those coverages were to be discussed for consideration at a later date and would be a separate policy.  Commissioner Stephens asked if the property insurance included flood insurance, and Mrs. Crosby responded that it does but that it is a separate policy that is done later in the year.  John Donaghy provided that the flood insurance renews in August.  Chairman Elliott asked if there would be a workshop to review this first and asked what would happen when Mr. McGinty comes in.  Mrs. Crosby noted that he would provide the proposal of the new rates and advise of the companies that responded and what the rates were that they had all offered along with the recommendation he has as the broker for JWSC.  Chairman Elliott expressed concern that there may be questions, and Mr. Junkin suggested that they could have a workshop the hour before at the next Commission meeting.  Commissioner Stephens noted he was comfortable with the staff making a recommendation and the Commission proceeding as long as everyone else is.  Mrs. Crosby advised that Mr. McGinty could give an overview of the policies, and asked if that was what they may want.  Chairman Elliott noted that he has spent the last two years dealing with the insurance, and had questions relating to terms such as “replacement” and if the property insurance is for full replacement with no depreciation deducted, or when they evaluate damage do they deduct the depreciation to calculate the payout.  Mrs. Crosby made note to ask for that explanation by Mr. McGinty. Commissioner Browning inquired about renewal and if the numbers stay somewhat like this, and do we pay this all at one time on the front end of the policy for the next term, or is there an amount paid each month?  John Donaghy responded that the premiums were all paid upfront.  Commissioner Browning asked when they would be due, and Mr. Donaghy advised March 15^th.  Commissioner Browning then asked if any provisions were made for this fiscal year’s budget to absorb an increase in the premium, and Mr. Donaghy replied that it may have been but he was not certain at that time.  Commissioner Browning noted that this would likely occur year after year, and if provisions have not been made in previous annual budgets that it should be considered and increases in premiums anticipated and included in the annual budget process.  Mr. Junkin commented that perhaps on the next renewal considering a 15 month premium to align the renewals with the fiscal year, and there was a brief discussion pertaining to this effort, and it was noted that this could be researched for possibilities.  Commissioner Browning questioned what would be put in the July 1^st budget for these premiums, and clarified the question to would the same amount as the new premium be put into the budget, or would there be a percentage of increase factored in the budget for the next year’s premiums.  He suggested to look at the average rate of the premium increases from the last 5 or 10 years and to at least factor something in to allow for future premium increases in the budget.  Chairman Elliott noted that he would like to know what the interest or charge would be if the premium was paid monthly and stretched out over a 12 month period. Commissioner Turnipseed confirmed with Mrs. Crosby that the diesel pumps would need to stay on the insurance coverage until they are paid off and that this is required by the finance company.  Commissioner Copeland inquired if there was anything that could be done for example on the automobile side where they could reduce some of our exposure with driver safety courses, restrict the drivers who actually handle certain valued vehicles, make sure that certain certifications are held, drivers with clean records for example.  Mrs. Crosby provided that there are two things done now, defensive driving training every year and DMV reports pulled annually on employees driving history to ensure there are no violations.  John Donaghy added that when the auto coverages are reviewed they look at the deductibles that are carried on each vehicle to see if those need to be increased or decreased and also look at clearing coverages on some of the older vehicles which may not be worth that much, and that all aspects of the coverage on the vehicles are reviewed each year.  Mrs. Crosby confirmed that this is done annually and the schedule of values reviewed as part of the application process, that anytime a vehicle is surplused it is removed from the coverage, and the values of new vehicles checked for coverage.

2. Licensing Process, Entitlements and Privileges – C. Harvey

Commissioner Harvey explained that previously there was a question regarding the requirements for licensing and certification for employees in water and wastewater operations positions.  He referenced a handout of supplemental information he provided to the Commissioners that gave some background information and the schedule of the processes for obtaining those licenses.  He then noted the employee he presented with his Class III Water Operator’s license earlier in the meeting and added that this meant that individual had to have a month of experience and also had to obtain a 40 course hours of water training, and then had to apply for his Class III license. Commissioner Harvey referenced what he had read and described during that presentation regarding the requirements and job description.  He explained that a Class III is first, then a Class II and finally a Class I which is the highest level of certification. Each is to perform certain duties as their certification allows. He added that a Class III is the basic license and there is a push in this organization to advance as much as possible.  Commissioner Harvey continued by mentioning that the benefits are also for us as an organization in that the employee is now certified and authorized to perform certain duties in our system and have the responsibilities associated with it to ensure our systems are performing adequately.  Commissioner Turnipseed added that continuing education is also a required part of their certifications, including attending water association conferences.  Commissioner Browning asked if Class I is the highest you can go, and Commissioner Harvey advised it was.  Commissioner Browning noted the documents shows there is no further education required to obtain a Class I, but must have a Class II certification and the required amount of work experience.  Commissioner Harvey explained that to take the exam for the Class I certification, you are not required to do any more course work, there is continuing education available, but after passing the test and satisfying all the requirements they can apply for their Class I license.  Commissioner Harvey also complimented the JWSC superintendents in that they encourage their employees in continuing education and working to obtain higher levels of certification.  Chairman Elliott inquired as to what outside organization verifies that the people we have working on water and wastewater projects that require licensing are actually licensed, and Mark Ryals advised that for inspections all employees are listed and what license is required to run the facility in that it has to be shown who is actually operating the systems.  Mr. Ryals added that this is an annual inspection by the EPD.  Commissioner Adams asked who pays for the application fee, and Commissioner Harvey noted that the application fee was normally paid for by the organization, but after taking the exam twice the employee would have to pay for it after that. He added that there is much training provided, some is brought in house as a more cost effective means over the expense of traveling to take the training out of town.

3. Wastewater Treatment Plant Flows Update – M. Ryals

Mark Ryals presented the Wastewater Treatment Plant Flows Update to the Commission.  He noted that there will be some items revised on the report as there are certain parameters required by the EPD that he wants to add to the chart, and some items that can be removed.  Mr. Ryals noted some of the details from the report. At Academy Creek for January 2018, the average Influent flow was 6.5 MGD with the maximum daily flow being 8.3 MGD, and the average flow from Pinova was .7 MGD.  The Effluent average daily flow for January at Academy Creek was 7.3 MGD, with the maximum daily being 9.4 MGD.  He added that the BOD average was 7 and TSS average was 12.  There was very little rain with the maximum day of rain at 1.6”, and the percent of plant capacity used was 54%.  Mr. Ryals then reported on the Dunbar Plant with the month of January 2018 having an average Influent flow of 3.4 MGD, and a daily maximum of 4.0 MGD.  There are no industrial flows at the Dunbar Plant.  The Effluent average daily flow was 2.9 MGD, with the maximum daily being 3.5 MGD.  He added that the BOD average was 3 and TSS average was 2. The maximum day of rain at Dunbar was 1.4”, and the percent of plant capacity used was 74%.  Mr. Ryals then provided the January 2018 data for the Southport Plant and noted it was the smallest of the 3 plants.  He noted the average Influent flow of .446 MGD, and a daily maximum of .680 MGD.  There are no industrial flows at the Southport Plant.  The Effluent average daily flow was .426 MGD, with the maximum daily being .721 MGD.  He added that the BOD average was 4 and TSS average was 9. The maximum day of rain at Dunbar was .8”, and the percent of plant capacity used was 28%.  Commissioner Turnipseed asked if the Influent BOD was about the same for all 3 plants, and Mr. Ryals noted it was about the same.  Commissioner Turnipseed also confirmed that they did not have to report the ammonia for these, and Mr. Ryals confirmed it was not reported and did not have a limit at this time, but this may be an item to be added for more information.  Chairman Elliott noted that he is bothered by the growth in the flows at Dunbar Creek from 2016, and this one needs to be watched to know how much is available in capacity, and by getting rid of I & I there could be capacity added.  Chairman Elliott also asked for running average of the flows such so they can see how the growth is, like a stock market graph so the general trends can be seen.  Commissioner Turnipseed commented about including the data to see how many customers are added during each month to reflect customer growth, and to include capacity growth as another number for comparison.  Commissioner Turnipseed asked if they measured influent or effluent phosphorous at any of the plants, and Mr. Ryals responded yes, the effluent phosphorous was measured at all 3 of the plants.  Mr. Ryals added that Commissioner Turnipseed was visiting the plant at 8:00 am the next morning and invited any of the other Commissioners to also attend.

4. Academy Creek Wastewater Treatment Plant Discharge – M. Ryals

Mark Ryals addressed the citizen who takes pictures while flying over the treatment plant and who has indicated that JWSC is releasing partially untreated wastewater from the Academy Creek facility.  Mr. Ryals added that he does not know how high this citizen flies or the conditions such as clean windshield, etc.  Mr. Ryals commented that there is not untreated wastewater released from this plant.  He provided that there is some foaming, but in December 2017 they had a surprise inspection from the EPD from Atlanta, of which he offered to make a copy of the report available to the Commissioners, and also noted the facility did very good on the report.  He added that as Constantine has mentioned in past that with the type of plant they are working with, there will be some type of foaming and some slight surface debris floating.  Mr. Ryals continued by explaining that the clarifier turns to activate the sludge and keep the sludge from settling and has an arm to skim the surface for debris to get it out of the system. Based on the type of oxygen system there will be some amount of foaming, even though they take measures to reduce that and try to treat to prevent.  As long as there is splashing, and as long as they are having to treat the various types of wastewater that comes to this plant daily, there will some type of challenge with the foam.  Mr. Ryals commented that they do have a small footprint, yet treat 67 MGD on average of wastewater.  There was some additional discussion pertaining to the treatment necessary due to the amounts of fats, oils, and greases that are released in to the system, for example from septic trucks, and that just one truck dumping 1500 gallons of grease into the system can cause issues.  The incoming trucks are monitored.  Commissioner Harvey confirmed that the EPD is responding to a complaint of the foam.  Mr. Ryals noted that it was, but also confirmed the appearance was the problem.  He then referenced the picture that was taken by the citizen at about 2:00 p.m. on 2/11/18 as noted, and then referenced the pictures he provided from the JWSC surveillance cameras which noted the times of the same day those pictures were taken.  One was taken at 1:27 p.m., the second at 2:03 p.m., and the third was taken at 2:20 p.m.  The JWSC photographs were taken from a closer view, and confirmed that there was no foam being released.  The pictures were reviewed and discussed by the Commissioners.  It was also noted that more pictures will be taken by JWSC via drone, and staff can also go by boat into the river if necessary to obtain more pictures.  Commissioner Turnipseed commented that most plants that have industrial waste and residential waste like we have are going to have some foaming no matter what process it is, and you do want to control it, but I think our people are doing a good job of controlling it.  Commissioner Browning notably agreed. Mr. Ryals advised that when they receive this type of complaint they do have to sit down, discuss and research it for answers.  He also commented that he strives for his staff to gain a higher class in their certifications and that by pushing them, they gain integrity, and he has a better class team.  Operators have to do a perfect job when no one is watching.

5. Water Infrastructure Finance and Innovation Act (WIFIA) Funding – A. Burroughs

Andrew Burroughs advised that this subject was requested for discussion after the White House issued their outline for rebuilding infrastructure in America.  He provided an overview of the Water Infrastructure Finance and Innovation Act Funding (WIFIA), and added that there are three major proposed programs within the report; the Infrastructure Incentives Program, the Rural Infrastructure Program, and the Transformative Projects Program.  He provided information about all three and began with the Infrastructure Incentives Program by advising that it provides $100 Billion in federal funding available for a variety of different infrastructure projects including water and wastewater facilities as part of the funding available which is to be administered by U.S.D.O.T., the U.S. Army Corps of Engineers, and the U.S.E.P.A.  Applications for this program will be accepted as soon as practical after the bill is passed, and then every six months thereafter.  Seventy percent of the rating that would be applied to each applicant would depend on commitment to non-federal funds for capital investments in the future and O&M investments in the future.  For those organizations accepted to receive funding, it will be required to show how the federal money will not be needed again in the future.  He also noted that this does include a “look back” period for previous investments due to concerns expressed, i.e. what if we have just put $20M in our system can that be used as part of our matching portion of the funds.  Mr. Burroughs added it does include this “look back” portion, but those organizations will not get full credit for those investments, and the further away from present it occurred, the less credit is given. For JWSC purposes our investment in capital resources typically comes from the R&R plan, the expansion plan and then SPLOST funds that we have used.  One key feature is part of this program, the block grants from the federal government can only fund twenty percent of the project, which is how the amount is calculated, i.e. if they are going to put a total of $200 Billion in the system and then generate $1.5 trillion of investment because eighty percent of that has to come from other sources.  Those sources include private entities, tax revenue, state funds (can be used if they are willing to partner with the federal government), and any bonding if you want to use WIFIA or your standard rate revenues that you receive.  Mr. Burroughs continued that based off of current $15M in SPLOST and $4M annually in R&R, and the proposed $3M annually in expansion funds, if there is no more capital expended or available from the state, without doing any sort of bonding or loan procedures the most we would be able to get from this program is $7.2M.  He noted that while this may seem like a large amount, it is by no means enough to fix all of our problems.  Mr. Burroughs also mentioned is that no state will receive more than ten percent of the total outlay from the program, therefore other areas in the state could affect the amount of funding available to JWSC.  As a part of the program, one of the main focuses of the outline was that it is wanted to be sure anyone who gets part of the money hits certain predetermined milestones for the funding, for example all funding would not be provided in one check, it would be received over time, and the recipient would have to prove they are hitting the milestones, because the government does not want to run into issues of having provided money and nothing happening with it for several years, or not at all.  Mr. Burroughs also gave an overview of the Rural Infrastructure Program which makes $50 Billion available out of the total $200 Billion, with eighty percent of that being distributed to the states for the governors of the states to determine what they are going to do with the funds, however the population eligibility is that the population must be less than 50,000 in the county, therefore Glynn County would not qualify.  The state would have to do follow-up for any projects that are awarded any of that funding as the state will have determined their own Rural Infrastructure Investment Plan once they are provided the funds from the federal government.  Mr. Burroughs then presented the overview of the Transformative Projects Program, and read the information directly from the outline.  It read that, “The Transformative Projects Program would fundamentally transform the way infrastructure is delivered or operated.  They would be ambitious, exploratory and ground-breaking project ideas that have significantly more risks than standard infrastructure projects but offer a much larger reward profile.”  He summarized that this is giving the opportunity to make decisions that are not necessarily well received because there could be a large loss on the other end.  Mr. Burroughs continued that $20 Billion would be allocated as part of this plan and would be determined by the Department of Commerce, which could mean that this funding may go towards more economic development projects than rehab projects.  For those receiving part of this funding, there is a value sharing program requirement by the federal government meaning that if there is any profit made by this project the federal government wants their portion returned at the end.  He then commented that out of the three programs, the one that makes the most sense for JWSC is the Infrastructure Incentives Program which is a 20/80 match, with us picking up the 80%.  He added that there were some slight changes to the WIFIA Program listed, and noted that WIFIA stands for Water Infrastructure Finance and Innovation Act.  He noted it is currently structured where you can only use WIFIA loans for 48% of your project funding, and you still have over half of your funding to come up with, and there are no proposed changes at this time. There is a lower interest rate typically than the traditional bond, for example if the bond market is giving you a 2.9% interest bond, you might get 2.7% from WIFIA with the one advantage that you are given a 35 year term to pay it back and can defer payment up to five years after the project completion, and they will work our customized payment schedules of you have multiple bonds that fall off at different times where you can pay a little less up front and pay more on the back end.  This program is designed based off of 48% to be used as part of a co-financing plan.  For those that apply for a WIFIA loan, there is a $100K application fee which is non-refundable even if you are not awarded a loan.  Mr. Burroughs advised that there are certain water projects that are not allowed for the WIFIA funding, and those that are specifically targeted with the Infrastructure Program are related to flood mitigation and water relay navigation plans, so the real changes allow more people to take part.  They are eliminating the current requirement that you have to be a community water supplier to qualify for the WIFIA funding, and now if you are a private entity that buys water for strictly a few people, you can be approved for this and also use the money to now clean up superfund sites.  He added that currently it is required to have two rating agencies’ opinions before you can apply for the loan, but now only one will be required.  This will help to reduce the administrative time and they are also trying to reduce the amount of time it takes to review applications.  Commissioner Copeland confirmed that the $100K fee was for the loan application, and Mr. Burroughs advised yes for a loan for 35 years at 2.75% or the current percentage.  Commissioner Copeland then asked it that was a preferential interest rate, and Mr. Burroughs replied that they would pretty much guarantee a .10 of an interest point better than going out to the bond market.  Chairman Elliott inquired if it was still basically a loan and you are just reducing the interest rate on the money you are borrowing.  Mr. Burroughs advised that was correct, and the loan could be extended five years longer, which theoretically at that point you would lose any gains you may have had from the lower interest rate you are paying because you are paying five more years of interest.  Mr. Junkin added that earlier in the day he and Mr. Burroughs had discussed that the more lucrative of the options for JWSC was to go after the GEFA loans which are going for even lower interest rates with a $25M maximum, and that the WIFIA funding was only there for the portion of funding that could not be gotten elsewhere. Commissioner Copeland asked if there was an idea of what would be required for an application, and Mr. Burroughs advised that there was a lot of pre-work and engineering that had to be done to where the project was construction ready prior to application, versus in a traditional bond market you would not have to have that work done ahead.  There is a disadvantage in having to put a great amount of money into a project to have it ready without knowing if your application would be approved.  Pam Crosby added that the minimum project amount that was involved was about $20M, which would be considered a small project, and that the engineering costs on such a project could be around $2M.  Chairman Elliott questioned if the engineering costs would be considered as a portion of the organization’s part, and Mr. Burroughs responded yes, it could be used as invested capital as part of your match.  Commissioner Browning reminded the Commissioners that this program has only been proposed by President Trump and has not gone before Congress yet.  Mr. Burroughs agreed and added that this may be a very long process. Chairman Elliott noted that his thought process on it was that JWSC should get our needs out there, and we need to tell our federal legislative delegation why this bill doesn’t suit our needs and what restructuring could be done in the process so that maybe Congress could pass something that is more palatable.  This sounds like a campaign promise but in reality we are not doing anything.  Mr. Burroughs noted that in the write up they were basically wanting private entities to help fund public infrastructure of which he did not know of a lot of people who have had success with that model.  Commissioner Browning added that his take on his reading and analyzing it for a short time is that the Chairman is right in his assessment.  He added but the President does want to fulfill the promise that he made, and he did with this, and it is apparent that he doesn’t like the current process that has gone on in this country for decades where Congress puts a lot of money out for infrastructure, and organizations like ours have to go through a long process to get any of that money approved, and it was previously taking somewhere around 17 to 21 years.  Commissioner Browning continued, the President doesn’t like the process taking so long which is why such a large amount of the money is going to state block grants, and he wants to cut the federal government out of the process to leave it between the organizations and their state.  This is to encourage private investment, for organizations to reach out to private investors to come to us and offer to help us fund projects.  He added that the president wants to privatize as much as he can, cut out the federal government as much as he can, and wants to limit the amount of money that the federal government puts in, and he is giving Congress a chance to indicate if they can do a better job of coming up with some money for infrastructure.  Commissioner Browning commented that he is not convinced that the final program will come out to be close to what is being proposed at this time. Commissioner Copeland asked if the package specifies any sort of time limit for how soon the organization would have to break ground on the projects, and Mr. Burroughs asked to clarify if he meant on the WIFIA Funding or the Infrastructure Program.  Commissioner Copeland noted he was asking about the Infrastructure Program, and Mr. Burroughs advised that would be agreed upon as part of the awarding as to how quickly you could get it done, and there would be predetermined goals that have to be met in order to continue receiving the funding, and that the total amount of funding is not provided up front.  He continued that a portion of the funding would be provided initially, and more given as predetermined goals are met, if the goals are not met on time there is no more funding provided, and those funds would then be available to award to someone else.  Commissioner Copeland confirmed that they would set goals on a case by case basis, and then added that he sees this as a positive thing, and he is hopeful that we have infrastructure money coming in this country.  He also noted that hopefully we will get some of that down this way, and he believes it would be a benefit for us to do that, and it would be a benefit for the nation for those funds to be available and for us to get some of those funds.  He continued by commenting that the longer it takes to work through Congress is actually a positive for us because we are not shovel ready, and what he would like to see us do is reduce the uncertainly in our Master Plan and start driving a stake in the ground for the projects that we really want to do, even beyond those that we have talked about in this five year plan today. We need to figure out what that is, drive a stake in the ground and start moving forward so that when something does come out of Congress we’re ready.  Commissioner Copeland added that also, as Chairman Elliott mentioned, we should be talking to our legislators and educating them on the importance of our projects to the county, the state, the nation, and literally the world because we have infrastructure here in this county that is important to the world, for example when you consider the Port. He noted that we need to get that information out there, and commented that he would like to see us doing that and reducing the uncertainty in our Master Plan.  Mr. Junkin added that with this being mid-term elections he does not see this happening any time soon, but like with any other opportunity we need to position ourselves as well as we can to be prepared for it.  He added that certainly one of the things he has considered since he first heard about it was, as both Commissioners have stated, do we put together how we would tweak it if we were in charge of setting the plan up as it does sound like there are a lot of barriers to anyone getting anything out of this, unless they are a very large utility with plenty of money to have things ready, or just a small one that has someone on the side waiting to get that business.  Mr. Junkin added that he has drafted some talking points and noted he believes that we do have some powerful people in our community, and also believes that within the industry we have some good contacts who have pretty influential positions in the industry, and that if they are communicating those points along, it might be a help.  Mr. Junkin recalled that the last infrastructure stimulus package went through the states for distribution, but by the time it got to the state level, the roads and bridges got it all.  He added some big changes have to be made, and there is a lot to be done in terms of messaging and getting our needs up to those who can make the decisions if and when they do turn some of this money loose.  He commented that we do need every penny they will send to us, but we want to be positioned if we can to get some of it if there’s a way to even if it looks like it will never happen.  Chairman Elliott commented that clearly we need to work and get more familiar with the state processes and who at the state can help us.  We need to talk to EPD at the state level and we need to talk to Economic Development.  He noted that staff needs to outline the steps so that we can sell our case at every level of government with clear numbers of what we would do with additional resources, and we also need to state what the impact would be as if we have to basically come up with the financing ourselves, and what our water rates and sewer rates would look like as if we have to replace a sewer or if we have to expand a sewer.  Chairman Elliott added that we have what’s going on in Southport, and we are not providing services down there.  We have a million gallon plant that is not even being used because we don’t have the money to expand in that area.  Commissioner Browning commented that he understands that we have to be positioned and poised and ready to go after any funding that we need for all these projects, but he hates to see us getting bogged down and making pitches to folks that probably can only help us if they ever get any money and that would be your state agencies here.  He added that if Congress doesn’t move forward, we have wasted our time in making pitches to state agencies when our staff has a lot to do to keep the current systems operational on a daily basis and working ahead every day, looking ahead and planning ahead in trying to move this organization forward.  He suggests that with this proposal that the President has put out, if we have issues with it or we think it should be made better, the folks who can do that are our U.S. delegation, our U.S. senators and our U.S. representatives.  Commissioner Browning added that he had an opportunity on Monday to address some of those issues with the senator who lives here in Glynn County and who has taken a keen interest in this infrastructure bill and he needs to hear from us. Commissioner Browning noted that we need to decide on our projects and how the federal government can best help JWSC in Glynn County with any issues out there that we see with the current proposal.  He added that it would benefit us to go in the right direction with the politically correct course of action to get the biggest bang, and that is to help our senators understand what our needs are and what a new bill could do to address those needs, and then they are going to have that opportunity. Commissioner Browning also noted he would like to see us focus on our U.S. delegation, which would be relatively easy to do since we have nearby office people for both whom we can contact and perhaps ask them to come by for a visit to discuss these things first hand with them, and said this is the approach he would recommend to the Board here.  Chairman Elliott commented that he concurred with Commissioner Browning, and added that Mr. Junkin and the staff could get together and make preparations to be ready.  Mr. Junkin advised that staff will be looking at the outline criteria and being making preparations and recommendations for pursuing the national representatives both within the trade organizations and governmental representatives.  Commissioner Browning commented that Mr. Burroughs has a good understanding of what has been outlined, which is needed in order to know what works for the organization and how to communicate that to the representatives.

6. January 2018 Month End Financial Statements – J. Donaghy

John Donaghy presented the January 2018 month end financial statement, including the information for the first seven months of the current fiscal year.  First he reviewed the Balance sheet and noted that on the previous day a list of accounts receivable with balances greater than $5,000 was sent out for their review.  He discussed it with legal counsel prior to releasing the information to them and was advised that he could provide only the name and the dollar amount owed, especially for a public meeting. Mr. Donaghy noted that on the report one customer shows up repeatedly with various accounts.  Chairman Elliott interjected the concern of the privacy aspect of the billing information and if they chose to release what they could release.  In speaking with legal counsel regarding this list of accounts owing over $5,000, and it is releasable information, they chose not to publish it at this time.  He added that JWSC does need to become more aggressive to encourage these individuals to pay, and when you look at the list it is surprising to see some of the organizations and people that are on this list that should be paying.  Chairman Elliott noted that he does not personally know what the answer is but in the next month he is going to ask Mr. Donaghy to provide a list of those that owe $3000 or more, which would be a 4 to 5 page list.  He added that we need to decide how as a Board how to try to influence these people to pay up.  This is hurting our cash flow mainly because it is treated as accounts receivable, so the dollars are showing as if we collected it and we need it for budget, but the issue becomes that they are not paying, and they should be, and it hurts cash flow.  Chairman Elliott then asked Jay Sellers if we have payment plans on all of these people who are over 30 days.  Mr. Sellers advised not all of them.   Commissioner Adams inquired if we have been in touch with them, and Mr. Sellers replied yes, we have.  Chairman Elliott commented that he would like to challenge him to try to make sure there are payment plans on all accounts on the first 2 pages owing $5,000, and then the following month to get payment plans on all those owing over $3,000.  Mr. Junkin advised that this was intended to be the strategy all along was to go after the low hanging fruit, and they did start working with those who owed the most money first and down to who owes the least.  He added that they are near having the technical things done that allows to track and notify these people formally through their bills that we are coming out to shut you off.  Mr. Sellers noted that there is one last step that should be completed next Tuesday with the software, and they will have a work session that afternoon with Harris the software vendor, and then by Wednesday it is expected that we should be going live.  Mr. Junkin commented that will facilitate us to meet the minimum requirements of notification and get out there to actually start turning peoples’ water off with notifications.  He added that he thinks that when we start turning water off, we will see these persons start coming in to pay their bills.  So, this is a pretty aggressive plan with just a few technical details left that we are working to iron out.  Commissioner Harvey noted that while this aggressive plan is good, it also has to be met with passion.  We cannot cut off 4,000 people from water at one time, as that will cause a ripple effect or something else happening, even though we know they owe that money, and realize that they are trying to do payment plans.  He commented that he was pleased that they were starting with those that they know can pay and probably just haven’t paid, especially some of these corporations that really can do something but they just haven’t done, and it may be an oversight.  Commissioner Harvey also added that we have to look at some of the poverty level income people who are tied to our system here, who are living from payday to payday, and like you said maybe with a payment plan they can do a lot better.  He noted that the threat of turning water off has an effect just like when you actually do go turn it off to some people and others may just call your bluff, but he added that he would like not to see 40% of the people in Brunswick who are delinquent in their accounts having their water turned off immediately and then we now have a run on water.  He then commented that with passion and with our process that we are doing hopefully we can alleviate that situation.  Mr. Junkin added that this was the intent as we are trying to make specialized payment plans to reach every customer to give them an opportunity to come and talk to us to work through the details so that nobody is stuck out there without a way to get through it.  Commissioner Harvey noted that by putting notice on the bills that when the next bill comes you water is going to be shut off, this might get their attention in big bold letters.  Mr. Donaghy advised the Commissioners that staff did meet earlier in the week to discuss the effect on cash flows and the relationship to the outstanding receivables which leads into the second page of the financial report which is the Supplemental Schedule of Cash Balances.  He noted that the first column is actual cash balances as of January 31, and the second column was transfers in transit on February 1.  He added that once the project report was run, they were able to determine the amount that needed to be transferred from one fund to another to bring the cash into balance, which is reflected in the third column, particularly in the JWSC Reserves, Capital Improvement Fees and SPLOST accounts which are all set aside for various capital needs.  Commissioner Turnipseed confirmed that the balance of the Capital Improvement Fee Reserves is $4.8M, and Mr. Donaghy replied yes, this was the actual cash balance.  Mr. Junkin asked if those were undesignated cash balances or are there projects.  Mr. Donaghy advised that there are projects and noted that for the R&R Reserve and the bulk of the Capital Improvement Fees there are projects on the books that those funds are allocated to so there is not much room to add new projects.  Commissioner Turnipseed asked if the $4.8M was available to be put towards the $22M that was voted on the Five Year Plan as approved earlier, and was advised that there were projects already out there that this money was allocated towards.  Chairman Elliott requested that the project report be broken out or grouped by which projects are R&R and which are Expansion so that they can see what portion of the funds is there for each, and the same for Capital Improvement  and SPLOST projects.  He added that we need to know exactly from that project list what is undesignated, and also added that if a project is old and we have not put any money to it, maybe it should be removed from the list, we might know what the budget should be for it but it does not need to be on this list and maybe on an awaiting funds list. Mr. Donaghy noted that on the project report, there are some projects that were named some time ago that a small amount of money was expended on, for example the Epworth Acres Low Pressure System Project which is still on the books with expended money for it, but whether that project goes forward or not is questionable and perhaps that project should be removed from the list and that money transferred elsewhere.  Mr. Donaghy referred their attention to the bottom of the page and the columns for Current Funds, Encumbrances, Balance to Complete, and Available Funds and noted that there are currently no projects to be funded from the Capital Reserve or the Expansion Reserve at this time so they are both there fully available, as well as the balance of $422K in the R&R Reserve.  Chairman Elliott advised he would like to see this report broken down into more detail and revisions to the charts at the top and bottom.  John agreed he would work on drafting the report in new form.  Chairman Elliott noted some of the projects remaining with small balances to complete, and Mr. Donaghy responded that the projects are not fully completed as of yet and may have a punch list or last item still out and these are held on the project list until the end of the year for tracking purposes.  He added that at the end of the year if the project is fully completed and put into service it is moved from the construction in progress category to a permanent fixed asset. Commissioner Turnipseed asked about the $18M balance to complete under the project list, and Chairman Elliott advised that this was the money needed to complete those projects. Mr. Donaghy added that the bulk of that $18M is the two SPLOST projects.  Chairman Elliott noted that while the report shows the budgeted amount, it also needs to reflect how much money is on hand for the projects.  Mr. Donaghy advised that he would work on clarifying the report details. Commissioner Copeland inquired about the Capital Improvement Fund Reserves to clarify the Balance as of 6/30/17 of $4.5M which is already allocated, and questioned if the Anticipated Balance as of 6/30/18 at $2.996M was already allocated.  Mr. Donaghy responded that was the same money moving forward, and that it was not spoken for in the projects on this list, but was spoken for in the Capital Improvement Plans for projects that have not yet been named and put on the project list, but which will utilize these funds.  Commissioner Copeland asked if this money was allocated for the ten projects as on the approved Five Year Plan, and Mr. Donaghy replied that yes, some of this money will go toward those projects.  He then reviewed the Combined Revenue Statement and the various details from that report.  Chairman Elliott requested a revision of this report to separate Capital Improvement Fees between residential and commercial. Mr. Donaghy added notation regarding the Planning and Construction Fees and that he had received the numbers from Mr. Kline which were not included on this report since they were booked after January 31, and that those fees are reported to be at about $16K. Mr. Donaghy then mentioned the Overtime Report. Commissioner Copeland asked if they are meeting monthly with the division heads to review the budgets, and Mr. Donaghy advised that he is setting up quarterly meetings.  The superintendents review and submit comments and necessary changes on their budget reports on a monthly basis.  Commissioner Copeland inquired if there any issues they need to know about that are being found from that process, and Mr. Donaghy responded that the changes are mostly required for coding errors where the expenses are applied to incorrect accounts and that this is a learning process in accountability for the superintendents.  Commissioner Copeland noted he believed it would be beneficial to continue that.

7. Georgia Senate Bill 404 – C. Dorminy

Charlie Dorminy presented a discussion on the Georgia Senate Bill 404 which had just been proposed in the Georgia General Assembly four days prior.  At this time, it is only a proposal and it is not known whether or not it will be passed, or exactly what the final outcome will be.  Mr. Dorminy explained that this was essentially to encourage the use of residential fire sprinkler systems, and the important part is Section (B) which says that no county, municipal or other public water system shall charge a separate fee for standby water service for fire sprinkler system connections. He noted that currently JWSC does charge for this, and he confirmed with Mr. Donaghy that this accounts for about $250K annually in revenue.  Commissioner Turnipseed asked if this was for residential, and if JWSC charged for residential.  Chairman Elliott noted that this proposed Bill is for residential, but that the language of it does not say that.  Mr. Dorminy confirmed that it does not say residential only.  Commissioner Stephens questioned if this a line on the bill for the customer being hooked on a fire sprinkler system or if it was the .75 cents that is applied for fire hydrants.  Mr. Donaghy advised that this charge shows up on the customer’s bill as a fire protection charge, and that there are various sizes of sprinkler systems.  It was confirmed that this was not regarding the .75 cents fire hydrant maintenance fee.  Commissioner Turnipseed asked if those sprinkler systems are metered, and Mr. Donaghy advised they were not.  Commissioner Turnipseed suggested that if this proposed Bill passed, then it would be necessary to put meters in to be able to charge for the water when it was used.  Mr. Donaghy noted that this has been discussed.  Mr. Dorminy then commented that he had looked at the update moments prior and it has only been introduced with no additional commentary and has been referred.  He advised he has spoken with a partner who will monitor the progress of this Bill, and if there was a need to lobby against it, we certainly can.  Commissioner Turnipseed asked if this was a Senate or House Bill, and Mr. Dorminy replied it is a Senate Bill.  Commissioner Copeland asked if the building code required sprinkler systems in residential garages, for example.  Mr. Dorminy responded that he did not think so, and Commissioner Harvey agreed and added unless it is an industrial garage.  Commissioner Turnipseed asked if Glynn County required sprinkler systems in apartment buildings, and the general consensus was that it was believed so. Commissioner Browning asked Mr. Junkin if there was an organization or lobby group in Atlanta that watched out for water and sewer entities such as JWSC.  Mr. Junkin advised that state wide there was the Georgia Association of Water Professionals which is a consolidation of American Water Works Association and Water Environment Federation which are the national organizations for water and the national organization for wastewater, but those are consolidated here in the state.  He added that they are the upper level of government affairs that this organization has, and they are the water and sewer utility at the upper level of representation trade organization, and that they may have lobbyist in their group that go and speak, but he was not completely sure. Commissioner Browning asked Mr. Junkin how much effort it would take on his part to reach out to them and ask about SB404 and what their thoughts are on it. Mr. Junkin advised he would check on it.  Commissioner Turnipseed offered that if Mr. Dorminy would give him a copy of the proposed Bill that he would call the next day and advise Mr. Junkin what was discussed.

EXECUTIVE DIRECTOR’S UPDATE

Mr. Junkin commented that the big item he is focusing on is the rate structure and the upcoming budget process, and the Commission approved change in the Operating Agreement which will give us more flexibility to do some more creative things with developing our rate structure.  In the coming week, a meeting with City and County representatives and their attorneys regarding the language we need changed and the issues.  Looking at a modified approach to the rate structure that gives to the same money, but maybe in a more equitable way for some of our citizens. Mr. Junkin advised that employee insurance meetings were held and are moving along to get all of the employee enrollment cards in and be ready for the start off with the March 1 issuance.  He noted that they are still working with the county planning staff for the language in the review processes with the language used in approvals and reviews to develop something to meet the community needs and protect JWSC from future risks.  Staff is trying to develop ways to find money, and are looking at other opportunities for grants.  He noted he has made a list of contacts that write grants for the water and sewer utility industry with plans to discuss what others are doing and what has given success.  Mr. Junkin added that on the customer service issues that Jay Sellers has done a great job of improving our ability to respond to our customers and giving them what they want particularly on the phones by making modifications in the way we are set up and recently set up the call center to take care of customers on the phones.  Mr. Junkin has asked staff to find any opportunities to save in costs or find places where we are losing monies, and that one place which was brought up to him is the drop box on SSI which costs $1200 per month and only has an average of 200 customer dropping their payments in that box, which costs JWSC about $4.79 each bill for those customers to drop their bill off at that drop box.  We want to terminate the use of that drop box as this is too expensive of a cost for that.  We should eliminate that cost. Commissioner Stephens asked if the online payment process has been implemented yet.  Mr. Donaghy advised that Harris and BB&T are working on that.  Commissioner Harvey asked when that was going to be implemented, and Mr. Donaghy advised he was not sure exactly when it would be changed over with Harris and BB&T, but JWSC customers are still able to use the Paymentus portal for online payments.  

CHAIRMAN’S UPDATE

Chairman Elliott had no further update.  He noted appreciation to the Commissioners.

EXECUTIVE SESSION

There was no Executive Session.

There being no additional business to bring before the Commission, Chairman Elliott adjourned the open meeting at 4:28 p.m.