2017 January – DUWA Board Meeting Minutes

Taylor City Hall City Council Chambers
1. Roll Call and Introductions
DUWA Chairman Rick Sollars called the meeting to order at 9:10AM, and asked for the roll call to be taken. Voting representatives were in attendance from 10 communities: Allen Park, Brownstown Township, Ecorse, Lincoln Park, Riverview, Romulus, Southgate, Taylor, Wyandotte and Van Buren Township. Chairman Sollars announced that a quorum (at least 7 members) was present. There were no representatives in attendance from Belleville, Dearborn Heights or River Rouge at the meeting.
2. Approval of Agenda
Copies of the agenda were made available prior to the meeting (Attachment 1). Motion by John Zech (Southgate) and seconded by Bill Matakas (Allen Park) to approve the agenda as presented. Motion passed unanimously.
3. Approval of Minutes from December 8, 2016 Board Meeting
Copies of the meeting minutes from the December 8, 2016 Board Meeting were distributed by email prior to the meeting (Attachment 2). Motion by Doug Drysdale (Riverview) and seconded by Roberto Scappaticci (Romulus) to approve the December 8, 2016 Board meeting minutes as presented. Motion passed unanimously.
4. Election of Officers
Chairman Rick Sollars reminded the Board that the DUWA Articles of Incorporation require the election of Officers (Chairman, Vice Chairman, Treasurer and Secretary) at the first Business Meeting of the year. He noted that the current slate of Officers has indicated a willingness to continue to serve if that is the desire of the Board. Motion by Kevin McNamara (Van Buren Township) and seconded by John Zech to elect Rick Sollars as DUWA Chairman, Bill Matakas as DUWA Vice Chairman, Doug Drysdale as DUWA Secretary and Dick Hinshon as DUWA Secretary. Mr. Hinshon indicated that he was amenable to continuing on as Secretary, but with the understanding that he is planning to retire in the summer, 2017, at which time it will be incumbent upon the Authority to elect a new Secretary. Mr. Hinshon noted that he is currently working on a Transition Plan to select and hire a Manager for the System who will then be responsible for directing the utility, and that he hopes to have this individual in place by July. The Transition Plan will be presented to the Board for review at the February Board Meeting. Chairman Sollars then called for a vote on the motion, and the motion was approved unanimously.

5. Service Agreement: Status Update on Community Approvals
Secretary Hinshon distributed a table showing the current status of Community approvals for the DUWA Service Agreement (Attachment 3). Mr. Hinshon noted that nine communities have approved the Agreement. He indicated that meetings have been scheduled with the Southgate and Riverview City Councils in February, at which time it is hoped that those two communities will approve the Agreement. Lincoln Park City Manager Matt Coppler indicated that the Lincoln Park Council will consider the Agreement on February 6. He noted that the Council has already been briefed on the response from DUWA regarding several issues and concerns.
The Allen Park City Council has also been briefed on the new Service Agreement, but has deferred action on approval until a pending issue relating to overpayments is resolved. Allen Park has provided documentation indicating that it has overpaid for operational costs and debt service for the Downriver System since2010. Mr. Hinshon stated that he and Finance Committee Chair Beth Bialy are actively involved in discussions between Allen Park and Wayne County, and are working to resolve the overpayment problem. Additional historical data relating to the “Excess Flow” charges is being sought from Wayne County in order to calculate the amount of the overpayment. The data generated by Allen Park for “Base Flow” shows an overpayment of nearly $2 million, and this does not include the “Excess Flow” and Debt Service charges that presumably were also overpaid.
Secretary Hinshon noted that it may take several months to resolve the overpayment issue, and suggested that it would be appropriate for Allen Park to approve the Service Agreement now since that action is needed to allow DUWA to proceed with the issuance of a new Revenue Bond. Bill Matakas questioned whether approval of the Service Agreement would adversely impact Allen Park’s financial status by requiring the City to continue to pay more than its fair share of costs either for operational expenses or debt. Mr. Hinshon indicated that he and Beth Bialy would address that concern, would assist the City by participating in meetings with Wayne County to resolve the overpayment issue.
6. Status Update on System Transfer
In the absence of DUWA Attorney Jim Fausone, Secretary Hinshon gave the update on the status of the System Transfer. Mr. Hinshon reported that there has been no written response as yet from Wayne County on the draft “Definitive Agreement”.
The DUWA finance team is continuing to work toward issuance of a new Revenue Bond to be sold by the Authority to generate funds to be used to acquire the System from Wayne County. It was noted that interest rates are rising after the November election, so the debt service payments on the bond will be somewhat higher than previously anticipated. The DUWA finance team is in regular contact with County staff and financial advisors, and discussions are underway to preserve the existing millage assessments as a revenue source to cover debt service on the Judgment Levy bonds. DUWA has asked Wayne County to retain the Judgment Levy debt on its books to avoid the need for a new Federal Court order to authorize millage assessments by DUWA. It is anticipated that this issue will be addressed on the next conference call with Wayne County which is scheduled for January 25.
Mr. Hinshon reported that negotiations between Wayne County and Veolia for a Contract to cover Operation and Maintenance of the Downriver System prior to the transfer to DUWA are still ongoing. The County transmitted a draft Contract to Veolia just prior to the Holiday Break, and Veolia has subsequently responded with a mark up showing proposed revisions. Corporation Counsel Zenna Elhasan has indicated that she will furnish DUWA with a copy of the proposed contract after the County has had an opportunity to review Veolia’s mark up.
7. Update on NPDES Permit re: Blending and Asset Management
Secretary Hinshon indicated that he has been working with Wayne County staff to review MDEQ’s proposed permit language for wet weather flow blending and asset management, and that Kelly Cave recently transmitted a mark up to MDEQ (Attachment 4). It appears that the parties are close to reaching agreement on the permit terms and conditions, such that a new NPDES Permit may be issued in the next few months.
8. Treasurer’s Report
Treasurer Drysdale had previously provided to the Member Representatives his report which included a balance sheet, status of payment of monthly assessments, revenue and expenditure report and invoices received from Plante & Moran and Hinshon Environmental Consulting (Attachments 5, 6, 7, and 8). Mr. Drysdale reported that the Authority received Wayne County’s payment of $500,000 from the FY17 Operating Budget to cover DUWA’s transition costs, and this is reflected in the balance sheet. Dykema Gossett has indicated the expenses incurred to date for services to DUWA as Bond Counsel as of December 31, 2016 total $24,503. This expense will be covered from the Revenue Bond proceeds when the bonds are sold. Motion by Dave Flaten (Ecorse) and supported by John Zech (Southgate) to pay the invoices submitted to DUWA when money is in hand. Motion passed unanimously.
9. Public Comment
Patrick McCauley questioned whether the Authority should re-examine the Letter of Intent to see if any of the terms and conditions need to be modified or updated based on the lengthy amount of time that has elapsed since it was originally issued. Chairman Sollars agreed that this might be warranted, and asked Mr. McCauley to contact DUWA Attorney Jim Fausone to discuss this issue.
10. Other Business
There was no Other Business brought forward for consideration by the Board.

11. Next Meeting Date
Chairman Sollars reminded the Board that the next regularly scheduled DUWA Board Meeting is February 9, 2017 (9:00 a.m. Taylor City Hall).
There being no other business, Chairman Sollars announced that a motion to adjourn would be in order. Motion by Bill Matakas (Allen Park), supported by Doug Drysdale (Riverview) to adjourn the meeting. Motion passed unanimously at 10:02 AM.
Meeting Minutes Prepared by:
Richard Hinshon
DUWA Secretary
January 23, 2017
1. Meeting Agenda
2. December 8, 2016 Board Meeting Minutes
3. Scoreboard dated 1/4/17 re: Community approvals of the DUWA Service Agreement
4. Proposed NPDES Permit language for blending and asset management
5. Status Report re: Payments from Communities
6. DUWA Balance Sheet
7. Invoice dated December 22, 2016 from Plante & Moran
8. Invoice dated January 9, 2017 from Hinshon Environmental Consulting