Board Meeting Minutes 09/30/2015

Reiss Jackson & Company

Frank provided copies of the accounting compilation report to the Board for review and discussion. Frank reported that he is still waiting for Mr. Jackson to come up and revise the balance sheet, waiting for the revised tax return as well as the updated property tax information.

Discussed was reorganizing the filing system, providing 1099 tax forms to vendors, backhoe rental and whether or not to include this as a payroll item, and making IRA contributions a payroll item instead of direct contributions. Frank advised the Board that the filing system will be reorganized to retain seven years worth of receipts. Frank reported that he will issue 1099 forms to those vendors who provide contract services such as paving, and pump maintenance. Frank reported that making backhoe rental payments a payroll item will increase the company’s workers compensation liability dramatically . Frank stated that he has always issued a 1099 for this service and the backhoe operator is responsible for any taxes associated with these fees, and Frank stated that he issues W-2 forms for any in the trench labor that occurs, all other employees get W-2 forms.  All present agreed to keep this standard as it is. Frank reported that the report includes a recommendation that IRA contributions become a payroll item that would increase the total contribution to about $2,800.00 per contribution to cover State and Federal taxes.  Frank stated that prior to receiving his first IRA contribution he contacted the company tax accountant for information regarding direct contributions and was told at that time this type of contribution would be fine. Norm Cione suggested that Frank contact the holder of his IRA’S and find out if this should be done as a payroll item and report back to the Board at the next meeting.  All present agreed.

Regis Duncan made the motion to approve this report as stated.  Rob Follett second. All in favor.

2015 Project Update

Frank provided a final project expense report for the Board to review.

The final expense report is as follows:


Phase 2- Expenses: Permit $675.00
Materials $5,443.51
Saw $93.50
Backhoe $5,655.00
Labor $4,329.20
Lab Fees $60.00
Paving $11,500.00
Total Phase 2 Expenses $27,756.31
Total 2015 Project Expenses $61,782.52
Total 2015 CIP Budget $72,936.00
CIP Funds Remaining $11,153.48

Maintenance Budget 2015 $7,784 .00

Total CIP & Maintenance Budget $18,937.48

Frank recommended replacing the water main isolation valve on Live Oak and Manzanita due to the fact that this valve is inoperable and needs to be upgraded.  All present agreed.

Rob Follett made the motion to accept the project update report as stated. Jon Kappeler second. All in favor.

Proposed Website

Chris Hannon advised the Board that he has not been able to work on this and asked if anyone could volunteer to research a proposed website.  The Board members agree that this could be a useful tool to provide company information as well as water outage information during upgrades and repairs. Jon Kappeler stated that the cost for set up and maintenance is not very substantial and is a good way to provide information. Rob Follett indicated that he can do some research on this proposal and bring information to the next Board meeting. After discussion Jon Kappeler made the motion to roll this agenda item over to the next meeting agenda.  Rob Follett second. All in favor.

Monthly Meeting Schedule

Jon Kappeler suggested moving the meeting schedule to every two months instead of monthly Board meetings.  Jon Kappeler stated that monthly Board meetings are really not necessary during the fall and winter months because there really isn’t a lot of activity as far as projects and could result in a reduced workload for Frank. Regis Duncan indicated that initially he thought that moving the meetings to every two months would increase Frank’s workload but after discussing this issue with Frank supports the idea of meetings every two months. Frank mentioned that if something did come up and a meeting of the Board was needed he would advise the members via email and a meeting can be scheduled. Frank stated that a January meeting is necessary because that is when he provides income and expense reports as well as the budget for the New Year for the Board to review.  Frank also explained that project planning usually occurs within the first couple of months into the New Year. Norman Cione commented that we can give it a try and see how it works.  Frank advised the Board that the November meeting is usually scheduled for the first week in December due to his vacation schedule, and there is no meeting scheduled for the last Wednesday in December. Norman Cione suggested scheduling the next Board meeting in November.  After reviewing the calendar Frank suggested scheduling meeting on November 18th at 6:30 PM. Jon Kappeler made the motion to schedule the next Boar meeting for November 18th 2015 and revisit meeting scheduling at that meeting. Rob Follett second Jon’s motion. All in favor.

Letter from Shareholder

Frank provided the letter submitted and discussed at this year’s annual meeting from Shareholder Derrill Quaschnick for review and discussion.

Topic of discussion was metering, developing a commercial water rate, employee evaluation s, and the building moratorium.  Frank advised the Board that metering only certain homes and commercial properties to determine water use is a big expense and adds to the existing workload. Frank indicated that estimates can be determined based on State approved averaging.  Frank also pointed out that the By-laws State that all shareholders are treated the same and this could cause issues.

Employee Reviews. Frank asked those present who would like to evaluate hisjob performance.  Norman Cione commented that we only have one full time employee and the rest are part time or seasonal employees that work on projects.  No action taken by the Board regarding metering, commercial rates, and employee evaluations.  Frank reported that the building moratorium has been policy for a very long time and advised the Board that the word moratorium gets peoples attention and they do request information regarding will serve letters.

Frank recommended that a moratorium remain in place.  Frank also stated that included in the will serve letters is a statement that this is a limited release and the building moratorium remains in affect. Frank stated that the moratorium allows the Board to issue will serve letters on a limited release basis based on current water conservation measurers in affect as well as available water supplies.  Rob Follett stated that the language for the building moratorium needs to be revised and there needs to be a written document on file. After discussion Rob Follett made the motion to revise the language stated in the building moratorium and to revisit this issue at future Board meetings.  Regis Duncan second.  All in favor.

Annual Bonus

Jon Kappeler reported that Frank got a good pay raise that takes affect in two stages and that Frank had been getting annual bonuses for several years until the Board decided on a pay raise.  Jon also stated that Frank had to ask each time and stated that it had been a long time since Frank got a raise.  So the Board decided that bonus discussions shall be on the agenda each year at the first Board meeting after the annual meeting.

Chris Hannon indicated that this was done to provide cost of living adjustments without Frank having to ask for adjustments.  Frank stated that he is not looking for a bonus this year and stated that he is happy with the salary increase adopted by the Board at the December 3′  2014 Board meeting.  Frank advised those present that it is on this meetings agenda because it is part of the motion that granted Frank a pay raise.

Vacation Schedule

Frank advised the Board that at this time of year is when he takes his vacation time to hunt during the hunting seasons.  Frank stated that he takes two days per week for the first three weeks of the season and takes the last week of the season off entirely. Frank also advised the Board that he will be leaving for an elk hunt to New Mexico on the 19th of November and will be gone five or six days.

Frank stated that he does come into the office during his vacation time to post payments and bills and handle any escrow’s that come in as well as returning calls that come in. Frank advised the Board that he will respond to any emergencies as communicated to him by on-call personnel.  Rob Follett made the motion to approve Frank’s vacation schedule. Regis Duncan second. All in favor.

Open Discussion

Regis Duncan reported that he and Frank got together and visited the well sites and storage facilities and provided photos with descriptions. Regis asked Frank to review and make any needed changes . Regis suggested that he could work with Frank on developing illustrations on how to operate and isolate the different components of our distribution system for emergency purposes. Frank agreed with this proposal. Rob Follett stated that our emergency response plan needs to be upgraded to make it easier for emergency personnel to operate the system in Frank’s absence. Rob Follett reported that there are agencies that can help with mapping and plan development using GPS technology and photographs. All present agreed that the plans need to be upgraded.


Jon Kappeler made the motion to adjourn the meeting. Norm Cione second. All in favor. Meeting adjourned at 8:00 PM. Next meeting scheduled for Wednesday November 18, 2015, at 6:30 PM, at 5766 Frontage Road, Angelus Oaks, California.