Minutes of 2018 Shareholders’ Meeting

(Prepared by Dan Higgins, Secretary)

The Annual Shareholders' Meeting of the Las Positas Mutual Water Company (LPMWC) was held at the Fellowship Hall of the Veronica Springs Church (previously the First Baptist Church), 949 Veronica Spring Road on June 20, 2018 (Minutes prepared by Dan Higgins, Secretary)

At approximately 7:15 PM, Director Rick Donovan announced that a quorum of shares were represented, with 420 shares represented and 380 needed for a quorum. President Jeff Childers thus called the annual Shareholders Meeting to order. Directors Jeff Childers, Dan Higgins, Layne Wheeler, and Rick Donovan were present, as was the Treasurer, Alice Donovan.

Secretary Dan Higgins then indicated that printed minutes of the 2017 Shareholders Meeting were available for review and had been distributed as shareholders entered. (The minutes had also been available on the LPMWC website). It was moved and seconded to approve the minutes. The vote for approval was unanimous.

Alice Donovan then began discussion of the financial reports that were distributed when shareholders entered.  It was reported that the total of current checking and savings accounts for LPMWC totaled $339,379 as of June 18, 2018. She indicated that she thought that LPMWC was in good financial shape, with operational and long term capital improvement accounts in a reasonable balance. She also indicated that she saw no need to adjust our billing structure and that no customers were far behind in payments. It was also noted that we had a bill of approximately $4000 last year for water from Goleta Water for the 10 days LPMWC was installing the new pressure tank pumps, plumbing and associated control equipment.

There were some questions about whether LPMWC should move some cast funds to higher interest CDs. It was noted that there is a need to keep cash readily available for upcoming capital improvements or emergency well repairs. It was also suggested that we might want to move some funds to another bank to make sure than FDIC insurance would cover potential bank losses. Alice indicated she would look into that and some of the new higher interest accounts now coming available. It was moved and seconded to approve the financial report. The vote to approve was unanimous.

Jeff Childers then presented a facilities report. He first noted that the new pressure pump/ electrical control system discussed at last years Shareholders Meeting has been performing as expected with no significant problems. The result has been better water pressure at customer’s connections. In the past year, a utility shed has also been installed at the well site for storage of supplies and equipment. An enclosure for weather-proofing the new air compressor has also be installed. Several different types of residential water meters have also been ordered for testing to determine what type of meter would be the best for the LPMWC system. He also indicated that the old and small water tank at the well has developed a number of small leaks and will probably be removed from the system. (The 2 newer large tanks have proven to be sufficient for our needs and are working OK.)

Jeff also reported that water usage had increased about 20% in 2017 over that in 2016, despite the continuation drought conditions in Southern California. Exact reasons for the increase are unknown, and shareholders present at the meeting were reminded that we need to continue conserving water. Jeff reminded the shareholders that our well draws its water at a depth of roughly 150 feet and the current static water level is about 35 feet. There has the been a drop in the water level as the drought has continued, but we still seem to have a sufficient supply. We do, however, need to avoid wasting water.

Planned future activities include testing of various residential water meters both off-line and while installed. Eventually meters are required throughout the system, although no changes in billing is planned. It is hoped, however, the the presence of meters will help us understand where water is being used, and induce conservation by letting customers know how much water they are using.

The next major system improvement is planned to be a new well. A new well is needed to provide a  backup that can be used when the current well needs maintenance. Jeff indicated that a new well is estimated to cost at least $100K. Some sort of water treatment system is planned after the new well is operational. Details of this system are yet to be established since initial investigation indicates that treatments to remove the large amounts of iron and manganese in our water are complicated and expensive. Currently, quarterly flushing of the mains and cleaning of water tanks are the methods used to reduce these minerals in our water.

Several questions were raised by shareholders. One was if the system has an emergency electrical generator to pump water should system electrical power be lost. The answer is ‘No’. It was noted that a long term power loss is thought to be a rare event and the purchase and maintenance of a generator would be costly. We also have the Goleta Water hookup as an emergency backup.

A comparison of water costs was then presented by Dan Higgins. He first showed a chart indicating how our average water usage per parcel had declined from the pre-drought levels of 2013 each year until 2017 when water use increased about 20%, As was done in the past few years, published water rates from the Santa Barbara, Goleta, and Hope Ranch water districts were obtained from the Internet and used to calculate what water costs would be for a daily usage of 800 gallons a day per parcel over a 3 month period. The 800 gallons per day figure is the approximate average for usage at a single parcel in the LPMWC water system average over the 2016 calendar year. Dan displayed a chart showing that the cost would be $1851 for Santa Barbara, $805 for Goleta, and $708 for Hope Ranch, while it would be only $255 for a parcel in our water company (LPMWC) (Almost identical with rates reported last year) It was noted that the high cost for the local water companies is due to the tiered rates and the large assumed level of consumption. Also, the Hope Ranch situation is probably most similar to that of LPMWC, due to large lot sizes and large amounts of irrigation. LPMWC rates are also low because of our small size and a minimal number of paid employees.

Layne Wheeler talked briefly about the continued need to conserve our water despite the fairly wet winter this past year. Leaking pipes, toilets, or faucets should be fixed. Lawns and other plants should not be overwatered, allowing water to run down streets. If you see a water leak at a neighbors, let them know!

Rick Donovan then called for nominations for the election of members of the Board of Directors.  It was then moved that the current Board be re-elected. No other nominations were received, and the current Board members (Jeff Childers, Dan Higgins, John Holehouse, Rick Donovan, and Layne Wheeler) were re-elected unanimously.

The meeting was adjourned at 8:15 PM.