October 10, 2007

Minutes of the regular meeting of the Board of Trustees of the North Shore Sanitary District held on Wednesday,

October 10, 2007 at 9:30 A.M. at the District Office of the Raymond E. Anderson Complex located in Gurnee, IL.

The meeting was opened with the Pledge of Allegiance.

On roll call, the following Trustees were present:

Daniel M. Pierce, President

Stephen J. Drew, Vice President

John R. Paxton, Treasurer

James E. Swarthout

Effie Wroten

Staff members present were General Manager Brian Dorn, Assistant General Manager Dave Miller, Attorney Jay Ukena, Director of Engineering Services Jai Gupta, Director of Laboratory Services Joe Robinson, Director of Operations Gary Sowma and Director of Technology Services Pete Russo.

Comments from the public were as follows:

Ed Collins, Public Affairs Reporter and Feature Writer from the Lake County News-Sun commented on the public open house that he attended on October 3, 2007 at the Sludge Recycling Facility. He complimented the Board of Trustees and the District Staff on a fine job done in the development and end result of the Sludge Recycling Facility and stated that he thoroughly enjoyed the tour.

President Pierce presented the Consent Agenda as follows:

A. Approval of the Minutes of the Meeting held on September 12, 2007.

B. Consideration of Bills.

Wastewater Treatment Fund. $2,753,199.88

Check No. 138441, Check Nos. 138455 through 138465,

Check Nos. 138468 through 138474, Check Nos. 138476 through 138493,

Check Nos. 138498 through 138667, Check Nos. 138684 through 138729,

Void Check Nos. 138466, 138467, 138475, 138494 through 138497.

C. Financial Report, August 2007.

D. Hearing Summary, September 10, 2007.

E. Current Status of Significant Industrial Wastewater Violation(s) in the Service Area of the NSSD.

F. 2007 Picnic Summary.

G. 2008 Holiday Schedule.

H. Press Articles.

1. Lake County News Sun.

i. ‘I’m in total shock’, 09/11/07.

ii. ‘NSSD to bill Park City on estimated water use’, 09/18/07.

2. Zion-Benton News.

i. ‘NSSD recognized for pollution compliance’.

3. The Wall Street Journal.

i. ‘One Midwest City Picks Condos Over Industry’, 09/12/07.

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 Drew 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 684 had been signed by the Governor on September 11, 2007. President Pierce stated that approval of SB 684 gives flexibility on several issues such as publications, emergency authorization limits and bonding issues.

President Pierce commented individually on each item. For publications, the Bill provides that the District no longer need to publish Annexation Ordinances which will be a cost savings to the District. The District will continue to publish all penalties, tax issues and fee changes. For emergency situations, the bill provides more latitude and authority for the Staff. The emergency contract limit was raised from $100,000 to $250,000 and the operating emergency limit was raised from $40,000 to $100,000 which is a tremendous help in promptly dealing with emergency situations that may arise. For bonding of Trustees, the bonding regulations were somewhat vague. With the passage of the new bill, the District is able to lease property for a term not to exceed 20 years versus 10 years.

President Pierce also stated that the new Senate Bill gives more flexibility to the Board of Trustees. Two changes became available with the passing of the bill. The first is the ability to change the name of the North Shore Sanitary District to North Shore Water Reclamation Facility. President Pierce stated at this time there was no consensus for the change but in the future the Board would have that option. The other change available would be an increase in salaries for the Board, an increase of $3,000.00. This is another change that the Board will consider in the future.

President Pierce thanked the bill’s sponsors - Senator Terry Link, Representatives Eddie Washington, Barbara Flynn Currie and Mark Beaubien Jr. for their continued support in the passing of Senate Bill 684. Trustee John Paxton extended thanks to President Pierce for all of his efforts to pass this bill. President Pierce suggested that the Staff review the North Shore Sanitary District Act every other year for potential revisions.

General Manager Dorn presented the Management Report as follows:

A. City of Lake Forest Request to Waive Connection and Annexation Fees for Elawa Renovation Project.

General Manager Dorn reported that a letter dated October 4, 2007 was received by the District from John Krasnodebski, President of Lake Forest Landmark, the Elawa Farm Architect stating that the Elawa Farm is a City of Lake Forest owned facility, operated and maintained by City personnel and volunteers. Elawa Farm is a historically significant group of buildings built in 1917. The farm buildings were designed by Alfred Hopkins and David Adler for the A. Watson Armour family. The City of Lake Forest is restoring and renovating the buildings for adaptive re-use as an Environmental Learning Center. Although this is a City facility, all funds are raised and donated through the Elawa Foundation, a 501c3 non-profit organization. Unfortunately, the funding does not meet the scope of the work required, and every dollar saved will greatly help out the project. Subsequently, Lake Forest Landmark is requesting that the connection fee of $6,138.00 and the annexation fee of $6,120.00 be waived for the Elawa Renovation Project.

The Board historically has not waived connection or annexation fees for non-profit organizations such as government, churches, schools, etc. President Pierce thought that a lower or reduced schedule of fees could be considered for such groups in the future. A discussion followed with the general consensus being that the request be denied for the Elawa Renovation Project and that the Board in the future consider establishing a set of reduced rates for not-for-profit organizations.

Trustee Swarthout stated that the District is paying rent associated with an expired lease to the City of Lake Forest for the Lake Forest Pump Station in the amount of $17,640 per year. No other Municipality charges fees to the District to lease property associated with District facilities. Trustee Swarthout offered to speak to the City of Lake Forest about negotiating the expired lease fee in exchange for removing the connection and annexation fees associated with the Elawa Renovation Project.

It was moved by Trustee Swarthout and seconded by Trustee Drew to Deny the Request from the City of Lake Forest to Waive Connection and Annexation Fees for Elawa Renovation Project.

On roll call, all Trustees present voted “Aye”. Motion declared carried.

B. Presented Engineering Agreement Amendment.

1. STS Consultants, Ltd., Services Agreement for Hydrogeological Consulting Services at NSSD Zion Landfill, Contract Amendment No. 1, $35,000.00.

General Manager Dorn stated that this Contract Agreement Amendment is for hydrogeological consulting services associated with various ongoing permitting issues at the North Shore Sanitary District Zion Landfill. Included in this Contract Amendment are the following tasks:

Task 1 Leachate head well L301 replacement (new well and abandonment of the old well);

Task 2 Hydraulic gradient and chloride investigation (pertaining to the A104 and G123 chloride

assessment);

Task 3 Preparation of responses to IEPA 5-year renewal permit comments;

Task 4 Well A104 infiltration assessment (pursuant to permit condition VIII.27 of modification No. 31).

This Contract Amendment will also include the drilling of the three gradient/salinity evaluation wells around the Cell B East area during the same mobilization as the L301 replacement leachate head well replacement.

It was moved by Trustee Swarthout and seconded by Trustee Drew to approve the Engineering Agreement Amendment No. 1 with STS Consultants, Ltd., for Hydrogeological Consulting Services in the amount of $35,000.00.

On roll call, all Trustees present voted “Aye”. Motion declared carried.

C. Presented the Zion Township Landfill Sludge Recycling Facility Monthly Status Report.

General Manager Dorn reported that in accordance with the terms of the settlement agreement with J.J. Henderson the majority of the $2.7 million total settlement amount has been paid. General Manager Dorn reported that approximately $20,000 was being held until all work which JJ Henderson is responsible for is fully completed.

General Manager Dorn reported the dryer continues to operate near its rated capacity on a consistent basis. Dryer run time between September 3rd and September 30th has averaged 89%. Downtime has been limited to routine maintenance or shutdown due to running out of feedstock at week’s end.

Run time for the Melter during the period from September 3^rd through September 30^th has averaged 41%. Melter modifications that were implemented during this downtime period included completion of the refractory divider wall in Zone 1 of the Melter and change out of the granulate feed drop tube system. The original reheater that had failed due to corrosion was reinstalled after retubing the unit to allow the Melter system to operate on an interim basis until the source of corrosion is found and corrected. The remainder of Melter downtime is attributed to system trips primarily associated with plugging of the granulate feed system or primary economizer. The District continues to work with Minergy and Donohue to resolve these issues.

General Manager Dorn reported that public viewings of the facility were conducted on September 27^th with officials from the City of Zion; on October 3^rd with local public officials; and on October 5^th with members of the League of Women Voters. General Manager Dorn received positive comments from each group.

D. Presented FY 2008 NACWA Dues, $10,692.00.

It was moved by Trustee Paxton and seconded by Trustee Drew to approve FY 2008 NACWA Dues in the amount of $10,692.00.

On roll call, all Trustees present voted “Aye”. Motion declared carried.

E. Presented FY 2008 IAWA dues, $8,825.00.

It was moved by Trustee Swarthout and seconded by Trustee Drew to approve FY 2008 IAWA Dues in the amount of $8,825.00.

On roll call, all Trustees present voted “Aye”. Motion declared carried.

Assistant General Manager Miller gave the Administration Division report as follows:

A. Presented Termination of Sewer Service, 3854 University, Gurnee, IL.

General Manager Dorn stated that Mrs. Nolder who resides at 3854 University was present at the meeting today to present her case to the Board of Trustees. General Manager Dorn introduced Mrs. Nolder and had her come forward to explain her situation.

The Nolders are scheduled for termination of their service on October 24, 2007. Mrs. Nolder requested that the Board of Trustees give her a third chance to set up a payment agreement. She stated she could pay her current bill with an additional $50.00 payment per month until the balance owed of approximately $1,255.00 is paid.

A discussion followed with the Board of Trustees agreeing to give Mrs. Nolder another chance provided that she pay $200 prior to October 17^th and $50.00 per month until the outstanding balance is paid. She must also pay all future quarterly user charge bills by their due date. Assistant General Manager instructed Mrs. Nolder to come into the District before the 17^th of October to sign an agreement and that the termination process would be put on hold.

It was moved by Trustee Paxton and seconded by Trustee Swarthout to approve a Payment Agreement Contract for Sewer Service at 3854 University, Gurnee, IL.

On roll call, all Trustees present voted “Aye”. Motion declared carried.

B. Presented the following Bid Summaries.

1. Bid No. 1283, (2) 2007 or 2008 1/2 Ton Window Vans.

i. 2008 ½ Ton Window Van – Lemay Auto Group, Inc., $15,926.68.

ii. 2008 ½ Ton Window Van – Lemay Auto Group, Inc., $15,426.68.

The Notice to Bidders was published in the paper and mailed to twenty-five (25) potential vendors. Bids were opened Monday, October 1, 2007 at 10:00 a.m. Following is a summary of the bids that were opened and the results.

Vendor	½ Ton Window Van Year/Model	½ Ton Window Van Total Delivered Price	½ Ton Window Van Year/Model	½ Ton Window Van Total Delivered Price
Lemay Auto Group, Inc.	2008 GMC Savana Cargo Van	$15,926.68	2008 GMC Savana Cargo Van	$15,426.68
Anderson Rock River Ford	2008 Ford E14 Cargo Van	$16,456.00	2008 Ford E14 Cargo Van	$16,256.00
Lyons & Ryan Ford	2008 Ford E14 Cargo Van	$17,076.06	2008 Ford E14 Cargo Van	$17,076.06
Freeway Ford-Sterling Truck Sales	2008 Ford E150 Cargo Van	$18,400.00	2008 Ford E150 Cargo Van	$18,400.00
*Bob Ridings, Inc.	2008 Ford E150 Cargo Van	Non-Responsive	2008 Ford E150 Cargo Van	Non-Responsive
**Anthony Pontiac GMC Buick	2008 GMC Savana Cargo Van	Non-Responsive	2008 GMC Savana Cargo Van	Non-Responsive

(*) Bob Ridings, Inc. did not include vehicle specification sheets as required per Bid #1283, therefore, the Purchasing Department recommends the Board deem this bid as “non-responsive”.

(**) Anthony Pontiac GMC Buick’s Bidder Acceptance Form reflected mathematical errors and failed to include a signature authorizing bid submittal. North Shore Sanitary District consulted with their attorney and was advised to deem this bid as “non-responsive”.

It was moved by Trustee Swarthout and seconded by Trustee Drew to award Bid No. 1283, (2) New 2008 ½ Ton Window Vans to Lemay Auto Group, Inc. in the amounts of $15,926.68 and $15,426.68, respectively.

On roll call, all Trustees present voted “Aye”. Motion declared carried.

2. Bid No. 1284, Scum Removal and Disposal – Midwest Power Vac, Inc., $69,450.00.

Bid No. 1284 was advertised in the paper and mailed to fifteen (15) potential vendors. Two responses were publicly opened on Monday, October 1, 2007 at 10:30 a.m. Following is a summary of the results.

Midwest Power Vac, Inc.	Est. Annual Gallons	11/8/07-11/7/08 Unit Cost	11/8/07-11/7/08 Est. Annual Total	11/8/08-11/7/09 Unit Cost	11/8/08-11/7/09 Est. Annual Total	11/8/09 – 11/7/10 Unit Cost	11/8/09-11/7/10 Est. Annual Total
Waukegan STP	10,200	$.68	$6,936.00	$.71	$7,242.00	$.74	$7,548.00
Gurnee STP	12,000	$.55	$6,600.00	$.58	$6,960.00	$.60	$7,200.00
Clavey STP	8,400	$1.05	$8,820.00	$1.07	$8,988.00	$1.09	$9,156.00
Annual Costs			$22,356.00		$23,190.00		$23,904.00
Total Estimated 3-Year Cost: $69,450.00
AAA Environmental Industries, Inc.	Est. Annual Gallons	11/8/07-11/7/08 Unit Cost	11/8/07-11/7/08 Est. Annual Total	11/8/08-11/7/09 Unit Cost	11/8/08-11/7/09 Est. Annual Total	11/8/09 – 11/7/10 Unit Cost	11/8/09-11/7/10 Est. Annual Total
Waukegan STP	10,200	$.91	$9,282.00	$.92	$9,384.00	$.92	$9,384.00
Gurnee STP	12,000	$.92	$11,040.00	$.93	$11,160.00	$.93	$11,160.00
Clavey STP	8,400	$.89	$7,476.00	$.90	$7,560.00	$.90	$7,560.00
Annual Costs			$27,798.00		$28,104.00		$28,104.00
Total Estimated 3-Year Cost: $84,006.00

It was moved by Trustee Paxton and seconded by Trustee Wroten to award Bid No. 1284, Scum Removal and Disposal to Midwest Power Vac, Inc. in the amount of $69,450.00 based on bid unit costs for a 3-year contract.

On roll call, all Trustees present voted “Aye”. Motion declared carried.

C. Presented Time Extension for Filing of Annual Financial Report.

Assistant General Manager Miller reported that a letter was sent to the Comptroller of Illinois requesting an extension to file the 2007 Annual Financial Report that is due on October 27, 2007 from our Auditor, John Blackburn of Swarztrauber & Company. The reason for an extension request is due to the immense amount of work that has been expended in the final reconciliation of the Zion Sludge Melter Facility which involved both the engineering and financial departments. It is close to completion but the October 10, 2007 Board meeting date does

not allow enough time to finish depreciation testing, final analytical procedures work, drafting of the statements, running the entire audit through the quality control process and the preparation of the Management’s Discussion and Analysis. Mr. Blackburn informed Assistant General Manager Miller prior to the Board meeting that the extension was granted and that the District had 60 days for submission. The final report will be available for approval at the November Board meeting.

Director of Engineering Services Jai Gupta gave the Engineering Division report as follows:

A. Presented the following Construction Change Orders:

1. C.O. No. 1, 20” Check Valve Replacement at PS4 and PS5, Martin Petersen Company, Increase of 20 Calendar Days.

It was moved by Trustee Swarthout and seconded by Trustee Drew to approve C.O. No. 1, 20” Check Valve Replacement at PS4 and PS5 to Martin Petersen Company an Increase of 20 Calendar Days.

On roll call, all Trustees present voted “Aye”. Motion declared carried.