_______________________________________________________________________________________________55439 29 Palms Hwy., Yucca Valley, Ca 92284-2503 | 760.365.8333 | www.hdwd.com | email: info@hdwd.com

FINANCE/AUDIT COMMITTEEREGULAR COMMITTEE MEETING

AGENDA Tuesday, January 14, 2020

10:00 AM

Action may be taken on any item listed on the agenda.

1. CALL TO ORDER

2. ROLL CALL

3. PUBLIC COMMENTThis is the opportunity for members of the public to address the committee on matters within theCommittee’s jurisdiction. Please limit comments to three (3) minutes or less. State law prohibitsCommittee members from discussing or taking action on items not included on the agenda.

4. DEPARTMENT ITEMS

4.A. ORDINANCE NO. 88, AMENDING TITLE 6, RATES AND FEES, OF THE DISTRICT CODE TOCOMPLY WITH SENATE BILL 998 RELATING TO WATER SERVICE BILLING AND DISCONNECTIONCommittee to discuss staff recommendation to review for adoption Ordinance No. 88, amendingChapters 6.05, 6.10, 6.35, and 6.40 of the Hi-Desert Water District Code regarding water servicebilling, fees and charges, complaints and disputed bills, and disconnection for nonpayment forresidential water service customers.Ordinance No. 88 - SB 998 (Changes to Water Service Billing & Disconnections).DOCX

4.B. VACUUM EXCAVATORStaff to present a replacement of Vacuum Excavator.HI DESERT water 873SDT.pdf

4.C. PROPOSED DRAFT ALLOCATION FOR THE EXPANDED USE LOANStaff to seek input and direction from the Finance Committee regarding the proposed draftgrant/loan allocation for the Expanded Use Loan.

5. DIRECTORS' REPORTS/COMMENTSFor information purposes only on subjects not covered by the agenda and no action to be taken.

6. MANAGERS' REPORTS/COMMENTSFor information purposes only on subjects not covered by the agenda and no action to be taken.

7. FUTURE ITEMS FOR DISCUSSION

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55439 29 Palms Hwy., Yucca Valley, Ca 92284-2503 | 760.365.8333 | www.hdwd.com | email: info@hdwd.com

8. ADJOURNMENT

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55439 29 Palms Hwy., Yucca Valley, Ca 92284-2503 | 760.365.8333 | www.hdwd.com | email: info@hdwd.com

Materials related to any item on this Agenda submitted to the Board of Directors or Committee Membersafter distribution of the agenda packet are available for public inspection in the Hi-Desert Water Districtoffice at 55439 29 Palms Hwy, Yucca Valley, California during normal business hours. All documentssupporting this agenda are available on the District website at subject to staff’s ability to post thedocuments before the meeting.

Reasonable Accommodation: Upon request, this notice will be made available in appropriate alternativeformats to persons with disabilities. Any person with a disability, who requires a modification oraccommodation to view the agenda or to participate in the public comment portion of the Board meeting,should direct such a request to Ed Muzik, Secretary of the Board of Directors, at 760-365-8333 oredm@hdwd.com. Please allow two business days for your request to be processed.

Disruptive Conduct: If any meeting of the District is willfully disrupted by a person or by a group ofpersons so as to render the orderly conduct of the meeting impossible, a meeting may be recessed or theperson or persons willfully disrupting the meeting may be ordered to leave the meeting. Disruptiveconduct includes addressing the Board or Committee without first being recognized, not addressing thesubject before the Board or Committee, repetitively addressing the same subject, failing to relinquish thepodium when requested to do so, or otherwise preventing the Board or Committee from conducting itsmeeting in an orderly manner. Your cooperation is appreciated.

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Agenda Item No: 4.A

Finance/Audit Committee Staff ReportMeeting Date: January 14, 2020Submitted by: Jonathan AbadescoPresented by: Jonathan Abadesco, Chief Financial OfficerAgenda Section:

Subject:ORDINANCE NO. 88, AMENDING TITLE 6, RATES AND FEES, OF THE DISTRICT CODE TO COMPLYWITH SENATE BILL 998 RELATING TO WATER SERVICE BILLING AND DISCONNECTION

Recommendation:Committee to discuss staff recommendation to review for adoption Ordinance No. 88, amending Chapters6.05, 6.10, 6.35, and 6.40 of the Hi-Desert Water District Code regarding water service billing, fees andcharges, complaints and disputed bills, and disconnection for nonpayment for residential water servicecustomers.

Fiscal Impact:TBD

Background:Senate Bill 998 (“SB 998) was signed into law in 2018 and is effective on February 1, 2020. SB 998 providesnew and enhanced protections for residential customers relating to water service billing and disconnection ofservice for non-payment. Many aspects of SB 998 are similar to existing laws regarding residential waterservice billing and disconnection. However, SB 998 also contains many new or more restrictive provisionsapplicable to the District. These include:

• All urban and community water systems, including the District, must have a written policy ondiscontinuation of residential water service for nonpayment that addresses certain subjects required by SB 998. The policy must be posted on the water system’s website and be available in English, Spanish, Chinese,Tagalog, Vietnamese, Korean, and any other language spoken by 10% or more of the water system’s servicearea.

• Residential water service cannot be disconnected for nonpayment until a payment by a customer hasbeen delinquent for at least 60 days.

• SB 998 requires certain noticing procedures for customers and occupants that are in addition to noticesalready provided under the District Code. All notices must be provided in the languages mentioned above. Inaddition, under certain circumstances, the water system must provide a written copy of its policy ondiscontinuation of water service before disconnecting service for nonpayment.

• SB 998 prohibits water systems from discontinuing service to customers who meet certain medical andfinancial hardship requirements, and are willing to enter into a payment arrangement for full repayment of thedelinquent charges. 4

• SB 998 requires water systems to have an established policy for how residential customers mayrequest a payment arrangement, and the system’s written policy must describe this process.

• SB 998 requires water systems to waive interest charges on delinquent bills and limit the amount of areconnection fees for residential customers who demonstrate a household income below 200% of the federalpoverty line.

• SB 998 requires the water system to report the number of annual discontinuations of residential servicefor inability to pay on its website and to the State Water Resources Control Board.

Existing law concerning termination of water service (Government Code § 60370 et seq.) will continue toremain in effect.

Currently, the District’s rules and procedures regarding customer billing, fees and charges, complaints anddisputed bills, and disconnection for nonpayment are addressed in various chapters of Title 6, Rates and Fees,of the District’s Code. The attached Ordinance has been drafted to revise these District Code chapters tocomply with SB 998 and Government Code section 60370 et seq.

Once changes to the District Code are adopted, staff will collect the relevant provisions as the District’s written“policy on discontinuation of residential water service,” which will be translated and made available on theDistrict’s website, as required under SB 998.

Attachments:Ordinance No. 88 - SB 998 (Changes to Water Service Billing & Disconnections).DOCX

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ORDINANCE NO. 88

AN ORDINANCE OF THE BOARD OF DIRECTORS OF HI-DESERT WATER DISTRICT AMENDING TITLE 6, RATES AND FEES, OF THE DISTRICT CODE TO COMPLY WITH SENATE BILL 998 RELATING

TO WATER SERVICE BILLING AND DISCONNECTION

WHEREAS, Hi-Desert Water District (“District”) owns and operates a public water system that supplies water to residential, commercial, public entities, and industrial customers throughout the District’s service area; and

WHEREAS, in 2018, the California Legislature adopted Senate Bill 998 (“SB 998”) which adopted new and expanded protections regarding discontinuation of residential water service for nonpayment and related matters; and

WHEREAS, the Board of Directors desires to amend the Chapters 6.05, 6.10, 6.35, and 6.40 of Title 6, Rates and Fees, of the Hi-Desert Water District Code (“District Code”) to ensure consistency with the requirements of SB 998 and other state laws concerning water service billing and disconnections of service.

NOW THEREFORE, BE IT ORDAINED BY THE BOARD OF DIRECTORS OF THE HI-DESERT WATER DISTRICT AS FOLLOWS:

SECTION 1. The Recitals set forth above are made findings and determinations of the Board and are incorporated herein and made an operative part of this ordinance.

SECTION 2. The District hereby amends certain sections of Chapters 6.05, 6.10, 6.35, and 6.40 of Title 6, Rates and Fees, to read as shown in Exhibit A, attached hereto and incorporated herein. All other sections of Title 6, Rates and Fees, shall remain unchanged.

SECTION 3. This ordinance shall supersede all other previous District resolutions and ordinances that may conflict with or be contrary to this ordinance.

SECTION 4. This ordinance shall be effective upon February 1, 2020. The revised provisions of Title 6, Rates and Fees, shall apply to water bills issued after such date.

SECTION 5. If any section, subsection, subdivision, sentence, clause, or phrase in this ordinance or any part thereof is for any reason held to be unconstitutional or invalid, ineffective by any court of competent jurisdiction, such decision shall not affect the validity or effectiveness of the remaining portions of this ordinance or any part thereof. The Board of Directors hereby declares that it would have adopted each section irrespective of the fact that any one or more subsections, subdivisions, sentences, clauses, or phrases be declared unconstitutional, invalid, or ineffective.

SECTION 6. Upon adoption, this ordinance shall be published or posted by the District Secretary in accordance with Water Code Section 31105.

ADOPTED by the Board of Directors of the Hi-Desert Water District at a regular6

meeting held on January 22, 2020 by the following votes:

AYES:NOES:ABSTENTIONS: ABSENT:

________________________________

President of the Hi-Desert Water District and its Board of Directors

ATTEST:

________________________________ (SEAL)Secretary of the Hi-Desert WaterDistrict and its Board of Directors

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Agenda Item No: 4.B

Finance/Audit Committee Staff ReportMeeting Date: January 14, 2020Submitted by: Tony CulverPresented by: Tony Culver, Director of Water OperationsAgenda Section:

Subject:VACUUM EXCAVATOR

Recommendation:Staff to present a replacement of Vacuum Excavator.

Fiscal Impact:$145,000.00 Estimate

Background:CRP has a 2007 vacuum that is used for potholing and is in need of constant repair. we would like to replace itwith a new one that would go to the Construction and Maintenance dept. the CRP crew will get the existingC&M vacuum. we would like to include this in the mid year budget.

Attachments:HI DESERT water 873SDT.pdf

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Investment Proposal (Quote)RDO Equipment Co.

20 Iowa AvenueRiverside CA, 92507

Phone: (951) 778-3700 - Fax: (951) 778-3746

Proposal for:HI DESERT WATER DISTRICT55439 29 PALMS HWYYUCCA VALLEY, CA, 922842503SAN BERNARDINO

Investment Proposal Date:Pricing Valid Until:

Deal Number:Customer Account#:Sales Professional:

Phone:Fax:

Email:

11/18/201912/18/2019

12607848333005

Steve Wren(951) 778-3700(909) 428-4800

SWren@rdoequipment.com

CommentsCARB REG FEE IS INCLUDED IN PRICE

Equipment InformationQuantity Serial Number

Stock NumberHours(approx.)

Status / Year / Make / ModelAdditional Items

Cash Price

1 TBDTBD

0 New 2019 VACTRON AIR873SDT $130,525.00

Equipment Subtotal: $130,525.00

Purchase Order TotalsBalance: $130,525.00

Tax Rate 3: (CASD 7.75%) $10,115.69Sales Tax Total: $10,115.69

CA Tire Fee: $7.00Sub Total: $140,647.69

Cash with Order: $0.00Balance Due: $140,647.69

Equipment OptionsQty Serial Number Year / Make / Model Description

1 TBD 2019 VACTRON AIR873SDT 1461 AIR 873 SDT - 14,000 GVWR - (2) 100 GALLON WATER T17000 SHT PACKAGE UNDER WATER TANK TOOLING STORAGE17155 6 WAY HYD POWER (UP-DOWN, IN-OUT AND ROTATION),5"17156 Wireless Remote for Hydraulic Boom17270 HYDRAULIC JACK - EASILY RAISE & LOWER TONGUE17350 4" SUCTION HOSE & TOOLING UPCHARGE TO REPLACE3"

D1260784 Page 1 of 1

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Agenda Item No: 4.C

Finance/Audit Committee Staff ReportMeeting Date: January 14, 2020Submitted by: Jonathan AbadescoPresented by: Ed Muzik, General Manager and Jonathan Abadesco, Chief Financial OfficerAgenda Section:

Subject:PROPOSED DRAFT ALLOCATION FOR THE EXPANDED USE LOAN

Recommendation:Staff to seek input and direction from the Finance Committee regarding the proposed draft grant/loan allocationfor the Expanded Use Loan.

Fiscal Impact:TBD

Background:The District began construction of the Wastewater Project in December 2016, which includes a treatmentplant, 3 pump stations, and 77 miles of the collection system. This capital infrastructure project was funded bya $142,000,000 loan from the State Revolving Fund. Separate from the State Revolving Fund, the ExpandedUse Loan will provide funding to property owners for private property connections. The loan will allow owners tofinance costs related to connecting to the centralized sewer system, decommissioning and abandoning septicsystems on private properties, and installation of laterals. The terms of the loan are for 30 years, at a 1.8%interest rate, and will be collected through property taxes.

Private property connections started on November 4, 2019. As of today, more than 250 properties areconnected to the District's main sewer, where 25 properties (or 10%) were financed through the Expanded UseLoan.

Staff will seek input and direction from the Finance Committee regarding the proposed draft grant/loanallocation budget for the Expanded Use Loan.

Handouts to be provided to the committee at the meeting.

Attachments:

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