Water Resources Municipal Property Corporation

MINUTES OF THE BOARD OF DIRECTORS OF THE TOWN OF GILBERT, ARIZONA WATER RESOURCES MUNICIPAL PROPERTY CORPORATION BOND MEETING, MONDAY, FEBRUARY 24, 2020 at 5:00 P.M., CONFERENCE ROOM 233, GILBERT MUNICIPAL CENTER, 50 EAST CIVIC CENTER DRIVE, GILBERT, ARIZONA BOARD MEMBERS PRESENT: Vice President Kevin Boudreau, Secretary-Treasurer John Wilcock, Director Paul Gonzales, Director Mark Safsten Director Bryan Scienza BOARD MEMBERS ABSENT: None COUNCIL LIAISON PRESENT: Councilmember Jared Taylor STAFF PRESENT: Kelly Pfost, Management and Budget Director Tanya Wright, Accounting Manager Jeanne Jensen, CIP Supervisor Patti Hageman, Management and Budget Specialist OTHERS PRESENT: None CALL TO ORDER Vice President Boudreau called the meeting to order at 5:07 p.m. OATH OF OFFICE. Management and Budget Director Kelly Pfost gave the Oath of Office to returning board members, Kevin Boudreau and John Wilcock, and new board member, Paul Gonzales. ROLL CALL Management and Budget Specialist Patti Hageman called roll and declared a quorum was present. COMMUNICATIONS FROM CITIZENS None received. AGENDA ITEMS 1. ELECTION – nomination and election of officers for 2020. Kevin Boudreau was nominated as President. A MOTION was made by Director Scienza seconded by Director Safsten for the above nomination. Motion carried 5 - 0 Bryan Scienza was the nominated as Vice President.  Town of Gilbert AZ Water Resources MPC February 24, 2020 Page 2 of 5 A MOTION was made by President Boudreau seconded by Director Safsten for the above nomination. Motion carried 5 - 0 John Wilcock was nominated as the Secretary-Treasurer. A MOTION was made by President Boudreau seconded by Director Safsten for the above nomination. Motion carried 5 - 0 2. MINUTES – consider approval of the minutes of the meeting of January 28, 2019. A MOTION was made by President Boudreau and seconded by Director Gonzales to approve the minutes of the meeting of January 28, 2019. Motion carried 5-0. President Boudreau provided an overview of the primary purpose/function of the WRMPC. Formed in approximately 1995, the WRMPC was based on the concept that growth in the Town should pay for itself. It was created at a time when Gilbert was changing from an agricultural community to a commercial and residential community, and there was a need to have water and wastewater infrastructure in place ahead of those developments. As there was a limitation on the amount of funding that the Town could provide to itself from the general fund, the WRMPC was set up as a way for the Town to borrow money. The borrowed funds via bonds would be paid back from System Development Fees (SDF). Once a bond is paid in full, the ownership of the asset transfers to the Town. President Boudreau stated that while the WRMPC reports to the Town Council, it is a separate legal entity. 3. CAPITAL PROJECTS – status report on capital projects. CIP Supervisor Jensen introduced herself and started her presentation with an aerial photo of the Greenfield Water Reclamation Plant (GWRP) before the start of the expansion project and one taken two weeks ago. She proceeded to review all current construction activity at GWRP Expansion Phase III. Councilmember Jared Taylor joined meeting at 5:18pm. Jointly owned by the Town of Gilbert, Queen Creek and the City of Mesa, with Mesa acting as lead agent, CIP Supervisor Jensen explained that the purpose of the current expansion project (WW075) at GWRP was to increase capacity from 16mgd to 30mgd. By the end of Phase III, Gilbert will go from 8mgd to 12mgd with their ownership of the plant going from 50% to 40%. Mesa will be increasing from 4mgd to 14mgd with their ownership going from 25% to 46.7%. Queen Creek will remain at 4mgd with a 13.3% ownership. Queen Creek opted out of the Phase III Expansion because their modeling showed that additional capacity was not needed at this time, so they deferred their participation until the Phase IV Expansion. CIP Supervisor Jensen explained that buildout ownership capacity is currently following the 2004 IGA.  Town of Gilbert AZ Water Resources MPC February 24, 2020 Page 3 of 5 CIP Supervisor Jensen reviewed all the partners and contractors involved in the project, which began in late 2017 and is projected to go until the end of 2020. The design was led by Carollo engineers, with subcontractor Brown & Caldwell. The CM@R was McCarthy. CIP Supervisor Jensen stated that the expansion at the plant is basically two projects with two funding sources. Gilbert’s share of the cost is right around $71M. WW114 was funded primarily through Wastewater Replacement Funds, while WW075 was funded via WRMPC Bonds. CIP Supervisor Jensen invited board members to take a tour of the facility. Staff will arrange date and time for a tour. Next, CIP Supervisor Jensen gave an overview of the Phase II expansion at the Santan Vista Water Treatment Plant. Project WA070 is technically complete and no additional expansions are anticipated at this time. The plant is a jointly owned and operated facility between Chandler and Gilbert. Gilbert is the lead agent. The project expanded the facility from its original capacity of 24mgd to 48mgd. while maintaining the flow split of 50/50 between Chandler and Gilbert. The cost of the expansion is also split almost 50/50. Any difference in the cost is due to Gilbert constructing an additional reservoir for itself on site, and Chandler building more pump station. The project was completed on schedule and under budget. The full facility came online in February 2018. Final completion of the project was in April 2018. CIP Supervisor Jensen reminded members about last year’s discussion regarding rock snot and the need to put new self-cleaning strainers in place to combat this endemic single cell algae. As project savings were used to purchase new strainers, which are in place and appear to be working, no extra funding was needed to complete the project. In closing, CIP Supervisor Jensen briefly discussed other ongoing water and wastewater efforts at the Neely Water Reclamation Plant and North Water Treatment Plant. She noted that staff also just completed worked on their Water Quality Master Plan in order to take an opportunity to look at all investments and assets across the water and wastewater portfolio. 4. ANNUAL REPORT – Consider approval of the annual financial report. Accounting Manager Tanya Wright reviewed highlights from the annual financial statement dated June 30, 2019. On the Statement of Net Position, restricted cash investments went down $27M mainly due to spending on the Greenfield expansion and paying down of principal and interest in the amount of $8.8M on the water and wastewater bonds. President Boudreau asked if the last asset listed with the deferred charge on refunding gets amortized into the interest costs. Accounting Manager Wright stated that he was correct. Accounting Manager Wright pointed out that the large increase in investment income and the difference in interest expense on the Statement of Revenues, Expenses, and Changes in Fund Net Position is because there were only three months of bond proceeds from the bond issuance in 2018 compared to a full year in 2019. Overall, the change in net position was similar to the prior year at about $6.4M.  Town of Gilbert AZ Water Resources MPC February 24, 2020 Page 4 of 5 President Boudreau asked if there were any other questions. There were none. President Boudreau thanked Accounting Manager Wright. No motion was made to accept the annual financial report. FUTURE AGENDA ITEMS/MEETINGS: 5. Identify future agenda items None at this time. COMMUNICATIONS 6. From the PRESIDENT on current events. None. 7. From the BOARDMEMBERS on current events. None. 8. From the COUNCIL LIAISON on current events. Management and Budget Director Pfost invited board members to attend the upcoming Council Financial Retreat in April. The exact date and location can be found on the Clerk’s website. 9. From STAFF on current events. None. ADJOURN A MOTION was made by President Boudreau, seconded by Secretary-Treasurer Wilcock to adjourn the meeting. Motion carried 5-0. The meeting was adjourned at 6:19 p.m. ATTEST: ___________________________ ________________________________ Kevin Boudreau, President John Wilcock, Secretary-Treasurer  Town of Gilbert AZ Water Resources MPC February 24, 2020 Page 5 of 5 CERTIFICATION I hereby certify that the foregoing minutes are a true and correct copy of the minutes of the Annual Meeting of the Town of Gilbert Arizona Water Resources Municipal Property Corporation was held on the 24th day of February 2020. I further certify that the meeting was duly called and held and that a quorum was present. Dated this __ day of _____________, 2020. ___________________________________ John Wilcock, Secretary-Treasurer