PARKWAY UTILITY DISTRICT MINUTES OF BOARD SPECIAL MEETING
JANUARY 22, 2020
THE STATE OF TEXAS §
COUNTY OF HARRIS §
PARKWAY UTILITY DISTRICT §
The Board of Directors (the “Board’) of Parkway Utility District (the “Districf’) met in a regular session, open to the public, at 12843 Tidwell Road, Houston, Texas, at 6:15 p.m. on January 22, 2020, whereupon the roll was called of the Directors, to-wit:
Brenda McNeil, President
Alphonso (“Al”) Rettig, Vice President
Jennifer Balderas, Secretary
Ron Everhart, Assistant Secretary
Gloria Woods, Director
All members of the Board were present, except Director Balderas, thus constituting a quorum. Mr. Bill Blitch of Blitch Associates, Inc., (“Advisor”) financial advisor for the District; Mr. Bradley Jenkins and Ms. Kaci Schlachter of JonesjCarter (“Engineer” or “JIC”), engineers for the District; Mr. Brian Chapline, Ms. Rebecca Marcucci, and Mr. Calvin Browne of Municipal District Services (“Operator” or “MOS”), operator for the District; and Mr. Reginald Wilson, Jr. and Ms. Brenda Presser of Norton Rose Fulbright US LLP (“NRF”), attorneys for the District.
President McNeil called the meeting to order, and in accordance with notice posted pursuant to law, a copy of the certificates of posting is attached as Exhibit A. The following business was transacted:
1. Public Comments. There were no comments from the public.
2. Discuss and review engineering services provided by JoneslCarter. The Board inquired about the status of the Water Plant Improvements project. Mr. Jenkins reported that the backside of the water plant panel was hit and needs to be replaced and that the contractor was instructed to replace the panel. He noted that the Water Plant is anticipated to go online in midFebruary 2020. The Board asked if there will be an extended warranty on the replacement panel in the event the replacement panel fails. Mr. Jenkins stated that the construction contract provides for a one-year warranty that will begin when the Water Plant returns to operation and there is no special extended warranty that is provided for specific areas that receive additional attention or repair. He stated that a Punch List will be made upon final inspection of the Water Plant Improvements when the project is completed. Mr. Jenkins stressed that the water tank is not maintenance-free and that rehabilitation will be required in 10-15 years and will be monitored under the District’s Capital Improvement Plan.
Mr. Jenkins noted that JIC meets with A&S once a month, physically or by phone to provide updates to the Board on the regional WWTP. He stated out that JIC identified early on that design for capacity required revision thus saving the District about $1,000,000.
Discussion ensued regarding the District’s capacity and Mr. Wilson noted there is no lease agreement between the District and Greenwood Utility District C’GUD”). Mr. Wilson reported on previous verbal and written agreements regarding capacity and confirmed there is no current capacity agreement between the Districts. GUO was going to re-route 150,000 gallons to Tidwell Lakes Wastewater Treatment Plant (“TLWWTP”), which would reduce capacity under the permitted amount for GUO and return some of the District’s capacity to the District. Mr. Wilson discussed a conference call with the District’s engineer, GUD’s attorneys and engineers regarding the gray areas regarding capacity and components for calculating usage. JIC created a chart reflecting usage for 2019 and Mr. Wilson has sent a cease and desist letter to GUO to stop issuing capacity based on connections into the WWTP from two days ago and moving forward until gallons per day are identified and confirmed. Mr. Wilson reported that alternative options will have to be considered by GUD to provide capacity and stay under permitted amount until expansion is constructed and completed. He stated that the District is following the procedures of the contract.
JIC stated that the flow meters have been installed at the regional WWTP and GUD received notice just prior to the meeting of the log in. Mr. Jenkins stated there will not be any data to report until the District’s next regular meeting. He also discussed the formula for calculations and the necessity to remove “wet weather” days and looking at the flows on dry weather days because the rain days distort the numbers.
President McNeil and Director Retting requested an invitation to attend monthly tours of facilities.
President McNeil discussed issues with engineering representation on engineering projects and consistent change orders due to mistakes with construction of the Water Plant Improvements. Mr. Jenkins responded that it would be different with a project they designed. President McNeil reminded Mr. Jenkins of their request to re-design the Water Plant Improvements project due to design by a previous engineer. Mr. Jenkins said that JIC did not hire the contractor and only designed the parts that were not clear to the contractor.
Discussion ensued regarding the design and construction of the Wastewater Treatment Plant Expansion project. Mr. Jenkins stated that it is not cost effective to have both A&S and JIC oversee the project and that meetings are held regularly to obtain updates from GUD. Director Everhart discussed implementing blind inspections to identify components that require monitoring. The Board asked about implement within the contract a clause to notify and include the District in all actions by GUO concerning the regional Wastewater Treatment Plant. Mr. Wilson stated that all proposed actions by GUD requires concurrence by the District before GUO can authorize action, including decisions made on bids and/or vendors. The Board requested a schedule and budget cost for a representative JIC to participate in primary inspections and warranty items.
President McNeil discussed the size of the current bond proposal and projects included that may have otherwise been performed by MOS, which may have resulted in a reduction of the total amount of the bond issue. Discussion ensued regarding increased taxes.
3. Discuss and review operation services provided by Municipal District Services LLC. President McNeil recognized Mr. Chapline, who availed himself for any questions the Board may have regarding operations. The Board expressed its concern regarding the General Manager not having access to the regional WWTP. Mr. Chapline stated that GUO has issues with unrestricted/unescorted access to the regional WWTP and prefers to monitor access. Mr. Chapline noted that MOS has no control over access to the Plant. Mr. Browne reminded the Board of a previous conversation in which it was stated that 24-hours’ notice is required for access to the regional WWTP. The Board stated that the District’s General Manager should have the same access privileges as GUD consultants.
President McNeil asked about the numbers origination that the Board gets regarding capacity. Mr. Browne explained the process of usage and formula for calculating capacity.
The Board discussed maintenance mishaps that had been neglected. Mr. Browne presented his plan of action that addresses previous issues. Director Woods complimented MOS on customer service.
4. Discuss and review financial advisory services provided by Blitch Associates, Inc.. The Board discussed financial issues due to damages from multiple prior weather disasters causing struggles for District residents. They also discussed the size of the bond proposal related to funds necessary for payment of debt service and concerns generation of funds related to taxable value. Mr. Blitch spoke about future commercial value and necessity to raise the District’s current tax rate, with the ultimate goal of reducing rates. No action was taken by the Board.
THERE BEING NO FURTHER BUSINESS TO COME BEFORE THE BOARD, the meeting was adjourned.
The foregoing minutes were passed and approved by the Board of Directors on February 12, 2020.
ATTEST: Secretary, Board of Directors