Minutes of the regular meeting of
the Board of Trustees of the North Shore Sanitary District held on Wednesday,
April 11, 2007 at 9:30 A.M. at
the District Office of the Raymond E. Anderson Complex located in
The meeting was opened with the
Pledge of Allegiance.
On roll call, the following
Trustees were present:
Daniel
M. Pierce, President
James
E. Swarthout
Effie Wroten
Trustee Stephen Drew was absent.
Trustee Paxton was in attendance via telephone. He is out of state attending to a family
emergency due to a brother being terminally ill and needing care.
Staff members present were
General Manager
Comments from the public were as follows:
Mr. Bruce Brazas of Edwards Engineering introduced himself. He stated that he was a subcontractor of J.J. Henderson’s on the construction of the Sludge Recycling Facility and was the only subcontractor to complete his job on time. He also stated that he was of the understanding that a settlement was close to being made with J.J. Henderson, that he was still unpaid and wanted to know if something could be resolved. Mr. Brazas stated that he was a private citizen making his complaint known in the hope that some restitution could be made to his company.
General Manager Dorn stated that the North Shore Sanitary District was close to a settlement with J.J. Henderson and that the District really has to follow the advice of its Legal Staff to finalize the settlement. General Manager Dorn and Trustee Swarthout said they would see what could be done to move this issue along and bring closure to the matter.
President Pierce presented the
Consent Agenda as follows:
A. Approval of the Minutes of the
Meeting held on
B. Consideration of Bills.
Wastewater Treatment Fund. $946,239.63
Check Nos. 135806 through 135819, 135840 through 135881.
Voided Check Nos 135882 through 136052.
Check Nos. 136053 through 136222
C. Financial Report, February 2007.
D. Hearing Summary,
E. Fair Lending Violation Review.
F. Annexation Ordinance.
1. Annexation No. 430, Submitted by Meadow Ridge Baptist Church, for approximately 14 acres for commercial use located on the north side of Route 173 approximately 1,000 feet east of Route 131, partially within the City of Zion.
ANNEXATION ORDINANCE
WHEREAS,
the property hereinafter described is contiguous to the North Shore Sanitary
District, and
WHEREAS,
said property is not within the corporate limits of any sanitary district, and
WHEREAS,
within the meaning of 70 ILCS 2305/28, the NORTH SHORE SANITARY DISTRICT has
power to annex the territory hereinafter described by the passage of an
ordinance to that effect, and
WHEREAS,
it is in the best interests of the citizens of the NORTH SHORE SANITARY
DISTRICT to annex the property hereinafter described.
NOW,
THEREFORE, BE IT ORDAINED BY THE PRESIDENT AND BOARD OF TRUSTEES OF THE
SECTION
1: That the property hereinafter
described to‑wit:
Parcel One:
The West 214.4 feet of the East 1148 feet of the South half of the
Northwest Quarter of Fractional Section 18, Township 46 North, Range 12 East of
the Third Principal Meridian, (Except the North 300 feet thereof), in Lake
County, Illinois.
Parcel Two:
Lot One in Meadow Ridge Subdivision, being a resubdivision
of Lots 1 thru 14 (both inclusive) in Arnest Acres
Industrial Center, being a subdivision of part of the South Half of the
Northwest Quarter of Fractional Section 18, Township 46 North, Range 12 East of
the Third Principal Meridian, according to the plat of said Meadow Ridge
Subdivision, recorded June 15, 1999, as Document Number 4370880, in Lake
County, Illinois.
be and the same is hereby annexed to the North
Shore Sanitary District.
SECTION
2: If the property herein described
was the subject of a sewer service agreement, that agreement is terminated as
of the effective date of this Ordinance.
SECTION 3: That a
certified copy of this Ordinance, together with a map of the annexed territory
shall be filed with the
SECTION 4: This Ordinance shall be in full force and effect from and after its passage and approval as provided by law.
G. Refund Account of
H. Press Articles.
1. Lake County News Sun.
i. ‘NSSD reaches $5.8M payment deal with
Navy’,
I. Authorize Payroll and Finance
Department to issue District checks to meet expenses
where necessary for payroll and
to avoid interest and/or penalties before the next Board
Meeting.
It was moved by Trustee Swarthout
and seconded by Trustee Wroten that the items under the Consent Agenda be
approved.
On roll call, all Trustees
present voted “Aye”. Motion declared
carried.
President Pierce presented the President Report as follows:
President Pierce reported that Senate Bill number 684 which updates the North Shore Sanitary District Act of 1911 has passed through the Senate and has moved to the Illinois House of Representatives. Trustee Pierce stated that a former Trustee, Eddie Washington is sponsoring the Bill in the House and that Karen May, the Representative who represents Highwood, Highland Park and Lake Bluff is also in support of this bill.
General Manager Dorn presented
the Management Report as follows:
General Manager Dorn stated that he wished to skip ahead to Item A under the Administration Division Report which included Mr. Daniel Florek being present at the Board meeting and wanting to address the following item.
A. Daniel Florek, 1911 Galilee Avenue., Zion – Request to Waive Hearing Fees and Title Search Fees in the amount of $231.78.
Daniel Florek
from
Assistant General Manager Miller
made several attempts to explain the billing process and Termination process of
the North Shore Sanitary District. Assistant
General Manager Miller attempted to show that the information and complaints presented
by Mr. Florek were incorrect and not factual. Trustee Pierce assured Mr. Florek that the District Staff would look farther into this
matter and would hold off the termination process until the next Board meeting
and that someone would be in contact with him before the date of the next Board
meeting on
General Manager Dorn then moved to Item B under the Administration Division Report.
B. Insurance Renewal, West Insurance Agency
1. Property/Casualty Insurance Renewal
2. Life, Medical & Dental Renewal
3. COBRA & IMRF Renewal.
General Manager Dorn introduced Brad West and Ed Shultis of West Insurance who presented to the Board the following insurance renewals.
Brad West presented an overview of the Property/Casualty renewal quotation which included quotations from the Federal Insurance Company, St. Paul Insurance Company and the Ohio Casualty Company. All these companies are rated “A” Excellent financially or better. The estimated annual premium of the program as proposed is $350,969 and provides the coverages as outlined in the property, liability, inland marine, crime, automobile, umbrella and public official’s liability sections. The above quotations include the peril of “terrorism” and represents an 11.8% decrease over the expiring premiums reflecting the current insurance marketplace trend for property and casualty rates.
It was moved by Trustee Paxton and seconded by Trustee Wroten to approve the renewal of the Property/Casualty Insurance recommended by West Insurance.
On roll call, all Trustees
present voted “Aye”. Motion declared
carried.
Mr. Ed Shultis
then presented the Life, Medical and Dental renewal along with the COBRA and
IMRF renewal quotations. Mr. Shultis stated that the current employee term life rates
are guaranteed to
Mr. Shultis stated that PHCS (Private Healthcare Systems), PPO access/managed care fees will increase by $220 annually.
Specific stop loss premiums will increase $21,324 annually ($100,000 deductible).
Aggregate stop loss premiums will increase $1830 annually. The stop loss insurance premium increase is based on medical inflation trend of 12%. A $100.00 claim paid during the last 12 months will become a $112.00 claim in the next 12 months.
As far as actual paid claims by the District, the past year has been a very good one. As of the date the renewal was prepared actual paid claims were $324,000 less than last year.
Allied requested stop loss insurance quotes from (7) carriers. Two (2) carriers declined to quote due to not being competitive in the market and the average age of the group. Of the remaining five (5) carriers, only one (1) could provide the $5,000,000 maximum liability currently provided by HCC Life. The District has maintained this liability since it began self funding claims several years ago.
The only carrier offering
$5,000,000 is Fidelity Security. Their
quote is $4,068 under HCCM’s renewal quote. However they will only cover claims incurred
in the last 12 months and the District Plan has a 13 month claims reporting
time frame so there could be a potential gap in stop loss coverage under the
Fidelity plan. In addition, Fidelity
requires medical underwriting review and they have a run in limit of $324,000
on claims incurred prior to
West Insurance recommends that the District accept the stop loss renewal quote from HCC Life and the PHCS fee increase. West Insurance also recommended approval of the new COBRA rates as presented in the Board packet.
It was moved by Trustee Paxton and seconded by Trustee Swarthout to renew the Life, Medical and Dental Insurance along with the COBRA and IMRF renewals as recommended by West Insurance.
On roll call, all Trustees
present voted “Aye”. Motion declared
carried.
General Manager Dorn presented
the Management Report as follows:
A.
General Manager Dorn stated that after J.J. Henderson Contract Termination, the District hired several of the onsite subcontractors to complete the remaining contract work as well as complete required work outside of the scope of J.J. Henderson’s original contract. All the remaining work, except for a few minor punch list items, has now been completed. There are no payments outstanding that needed to go out this month.
General Manager Dorn stated that settlement discussions with J.J. Henderson have been completed. The District’s legal counsel is working with J.J. Henderson’s legal counsel to finalize a settlement agreement that can be presented to the Board for approval.
Air emissions testing required by the IEPA Bureau of Air construction permit started the week of March 26th and was completed the week of April 2nd. Emissions testing during the first week of testing focused on the Melter emissions, while the dryer and thermal oil auxiliary heater emissions were sampled during the second week of testing. Final results will take a couple of weeks to receive. Upon satisfying all emissions testing requirements, and any other construction permit issues, the operating permit from the IEPA can be issued for the Sludge Recycling.
Trustee Paxton inquired about an open house for the public at the Sludge Recycling Facility. General Manager Dorn responded that he would like to have the Melter site cleaned up and that early summer would be a good target date for an open house.
B. Presented the Engineering Report.
1. Standby Power Improvement Study.
General Manager Dorn reported that a Standby Power Study Improvement Plan was performed by Donohue and Associates. The purpose of this study was to determine the financially viability of operating the existing STP engine generators in a “peaking mode” during the utilities peak rate period; second, determine generation facility requirements and associated costs to provide full standby power at each plant; third, determine the full standby power generation facility requirements, associated costs, and financial viability of operating these facilities in a “peaking mode” at the Sludge Recycling Facility; and finally, determine the financial viability of using methane gas from the Veolia Landfill, located east of Green Bay Road and north of 9th street, to operate equipment and/or generation at the Sludge Recycling Facility.
The three sewage treatment plants currently meet the IEPA requirements for providing an alternate source of electric power during a power outage. However, the standby generation at the plants does not have the capacity for operation of the entire plant during a power outage. During extended power outages, exceeding 4 hours, plant operations could become difficult and the ability to meet the plant permit requirements could be impacted without the aeration equipment. Higher plant flows typically occur during storms and power outages are more likely to occur during a storm. The likelihood of more frequent and longer power outages has also increased due to the deregulation of the electric utility and the growing demand on the utility grid.
To assure continued plant operation during power outages, adding additional generation to the plants to allow the operation of the aeration equipment during a power outage was investigated. Two alternatives were investigated: 1) generation for operating both stages of aeration and the rest of the plant and 2) generation for operating only the first stage of aeration and the rest of the plant. The cost of Alternate 1 would be approximately $3.4 million for the Clavey Road Plant, approximately $5 million for the Gurnee Plant and approximately $3.4 million for the Waukegan Plant.
The Sludge Recycling facility currently does not have standby generation to keep the facility operating during a power outage. It does have a small generator to keep the thermal oil circulating during a power outage to prevent damage to the oil. All three of the STP’s send their sludge to the Sludge Recycling Facility to be processed. An extended power outage, exceeding 3 days, would require the District to find alternate methods of sludge disposal. The likelihood of more frequent and longer power outages has increased due to the deregulation of the electric utility and the growing demand on the utility grid. Both alternates investigated will allow the facility to process the sludge. Alternate 1 is for generation for operating the entire facility and Alternate 2 is for generation for operating just the dryer and disposing of the dried sludge at an off-site location. Alternate 1, generation for operating the entire facility, is recommend because no off-site sludge disposal is required. The cost of Alternate 1 for the Sludge Recycling Facility is approximately $5.1 million bringing a total recommended project cost of approximately $17 million.
With respect to utilization of methane from the Veolia Landfill as an alternate energy source, a private firm named EDI owns Veolia’s methane rights for the next 20 years. The capital investment to convey and scrub the gas, and to modify the existing natural gas burning systems at the Sludge Recycling Facility, combined with EDI’s gas charges, far exceeds any financial benefit to the District to utilize methane. Likewise, EDI’s charges to sell electricity they generate directly to the District exceed the current electricity charges being paid by the District.
Trustee Swarthout inquired about the option of looking into the rental of generators at the sewage treatment plants instead of going with the recommendations made in the standby power study. Trustee Swarthout suggested we look into that first and possibly incorporate the $5.1 million cost of providing alternate power to the Sludge Recycling Facility into the FY08 capital budget.
General Manager Dorn also pointed out that the District has one 2MW portable generator that can be floated between the three sewage treatment plants in the case of an emergency power outage. The only site which would be without power would be the Sludge Recycling Facility. This item was tabled and research into renting equipment will be looked into and be brought back at the next Board meeting. In the interim, the Staff will include only the cost to provide standby power at the Sludge Recycling Facility in the FY08 capital budget.
C. Bid Waiver Request.
1. BW-143, Consulting Services by Short Elliott Hendrickson, Inc. for Services Related to MILCON Programming, $11,551.85.
General Manager Dorn reported that Short Elliott Hendrickson, Inc prepared the original MILCON programming documents that were submitted to the Navy in July 1999. Their services were retained during the negotiation process with the Navy that restructured the capital reimbursement process by eliminating the MILCON program reimbursement. Services included participation in several meetings with the Navy and reviewing and responding to proposals prepared on behalf of the Navy by their consultant.
It was moved by Trustee Swarthout and seconded by Trustee Wroten to approve Bid Waiver Request 143, Consulting Services by Short Elliott Hendrickson for services related to MILCON programming in the amount of $11,551.85.
On roll call, all Trustees present voted “Aye”. Motion declared carried.
Assistant General Manager Miller gave the Administration Division report as follows:
Items A and B had already been covered under the Administration Division report so we moved to Item C.
C. Presented the following Bid Summaries.
1. Presented Bid No. 1267, Security Services – Andy Frain Services, $481,362.00.
Assistant General Manager Miller
reported that the bid was advertised and mailed to twenty-four possible
vendors. Six responses were opened at
Security Service Hourly Rate Hourly
Rate Hourly Rate Total Estimated Cost for
6/1/07-5/31/08 6/1/08-5/31/09 6/1/09-5/31/10 3 Year Contract Period
Andy Frain Services 12.68 13.12 13.45 $481,362.00
Ohlson Investigation & Security 12.80 13.15 13.51 $483,937.44
Per Mar Security Services 13.96 14.26 14.62 $525,389.76
Bill Howe Security 14.87 14.87 14.87 $547,097.04
KARD Protection Group, Inc. 15.60 16.07 16.55 $591,370.08
Diamond Detective Agency, Inc. 16.69 16.69 16.69 $614,058.48
The Purchasing Department recommends awarding a three year contract to Andy Frain Service, the low bidder meeting specifications to provide Security Services. They are currently providing Security Service at North Shore Sanitary District’s STP’s at a rate of $12.68 per hour. The bid submitted by Andy Frain reflects a three year average hourly rate increase of 6.2% compared to t