WANAQUE VALLEY

WANAQUE VALLEY

REGIONAL SEWERAGE AUTHORITY

MINUTES

Regular Meeting

February 26, 2008

Regular Meeting

The WANAQUE VALLEY REGIONAL SEWERAGE AUTHORITY conducted a Regular Meeting, which commenced at 6:32 PM, in the Wanaque Valley Regional Sewerage Authority Administration Building, Wanaque, New Jersey with Chairman, Frank Covelli, presiding.

ANNOUNCEMENT

Mrs. Maas, Recording Secretary read the following announcement:

This is the Regular Meeting of the Wanaque Valley Regional Authority. In accordance with the Open Public Meetings Law, notices of the meeting were furnished to the respective Municipal Clerks of Ringwood, Wanaque and West Milford together with a request that an additional copy of the Notice be placed in each Municipal Building. Notices were also sent to the following newspapers: the Herald News, the Trends and the Record. A copy of the notice will be filed with the minutes of this meeting.

ROLL CALL

Commissioners present: Andrew Bolduc, Frank Covelli, Robert Moshman and Patrick Murray

Commissioners absent: Thomas Bigger and Robert Hadley

Also present: Richard Miller, Esq., Williams, Caliri, Miller & Otley

Charles Ferraioli, Jr., M.P.A., Ferraioli, Wielkotz, Cerullo & Cuva

James Kelly, P."E., Boswell Engineering

Gregory White, Facilities Manager

Margaret Maas, Recording Secretary

REVIEW OF CONSENT AGENDA

The Chairman stated that he would like noted that each of the resolutions will be one number lower. and he stated the second thing he would like to call attention to is; that there were two minor typographical errors in the January 2008 minutes that he asked the Secretary to correct. The corrections will not change the intent or the purpose of the minutes but he wanted that noted, when they are to be voted upon. The Chairman stated the third thing is that is one of vouchers that was inadvertently submitted does not belong there has been voided. The Chairman asked Commissioner Bolduc if, when he went through the vouchers, he noted that. Commissioner Bolduc indicated that he had. The Chairman stated that he was aware that Commissioner Murray did not sign the check that would have accompanied that voucher; that should be noted. The Chairman asked Mr. Ferraioli if the Audit Report Corrective Action Plan and the Audit Report Review Certificate could be done on the Consent Agenda or should they be done separately. Mr. Ferraioli stated that they were fine on the Consent Agenda.

The Chairman stated that those are the things he had concerning the Consent Agenda and asked if anyone else any concerns or comments. When there was no response the Chairman moved on to Reports.

REPORTS

Facilities Manager

Noise and Odor Control Report - Update

Mr. White stated with regard to Odor Control that the media in all the odor control units was sampled two weeks ago and we're now waiting for analysis from the laboratory. Mr. White stated that any media that requires exchange will be done before the start of the warm weather. He stated that we will also be changing the carbon in the vent pipe canisters that are scattered throughout the neighboring development as well as the manhole inserts.

RFP’s Professional Services

Mr. White explained that the RFP's - Professional Services was an item that was left on from last month's agenda to emphasize that we are in receipt of the packages from the various professionals.

The Chairman asked Mr. White if he would see to it that all professionals, that submitted proposals have been properly thanked for that's those submissions. Mr. White stated that he would take care of that.

Financial Disclosure Forms

Mr. White asked the Commissioners if they would review and then sign all copies of the Financial Disclosure Forms that are in their file folders. He asked that they then be returned to either himself or the Secretary, Mrs. Parrinello. Mr. White stated if there are any concerns or corrections necessary to please note them on the form and Mrs. Parrinello will take care of that.

Energy Efficiency Audit (EEA)

Mr. White reported that the EEA audit is underway that PMK has requested information - basically in the form of our utility bills. Mr. White stated that they have been provided with the information and we are cooperating in every way possible.

Plant Flows, Operations, Revenue - Update

Mr. White reported that the flow was very high last month due to the wet weather received in the form of rain and snow melt. He stated that we have been inundated with flow at times, particularly from the Haskell Pump Station service area.

REPORTS

Facilities Manager

Plant Flows, Operations, Revenue - Update

Mr. White stated that on February 13th he had to provide notification to NJDEP that we had to bypass and pump/dilute raw sewage into the storm drain, because of the facility being inundated with flow. The proper notification procedure was followed and performed. Mr. White stated that it was an intermittent bypass operation protecting the integrity of the plant and that he does not anticipate any action being taken by .NJDEP. Mr. White reported that the flow continues to be quite high with the wet weather.

Operations

Mr. White reported that even though we have been receiving high flows the plant is operating extremely well.

Revenue Update

Mr. White reported for the first four months of the fiscal year, we are $30,000 ahead of last year's revenue figures, which puts us off to a great start. Mr. White stated everything is operating very well.

The Chairman asked if there was anyone that had any questions on Mr. White’s report.

Commissioner Moshman asked Mr. White if his understanding was correct - that there were two incidents in which he had to perform bypass pumping. Mr. White stated no, that it was an intermittent bypass over a 24 hour period. Mr. White explained the procedure for Commissioner Moshman. Mr. White reported that most of the I & I seemed to be coming from the Haskell Pump station service area. Mr. White reported that he spoke with Mr. Bill Kelly of the Local Sewerage Authority with regard to the I & I.

When there were no further questions or Mr. White, the Chairman stated that he would now receive the accounting report from Mr. Ferraioli.

Accounting

Certificate of Deposit (CD) - Bond Reserve Fund Roll Over

Mr. Ferraioli reported that he and Mr. Miller were authorized to seek the best interest rates for the investment of our Certificate of Deposit. Mr. Ferraioli reported that we were fortunate to get a 4.2% interest rate from Greater Community Bank. This Certificate of Deposit is being invested for a six month period.

Bond Sale Meeting

Mr. Ferraioli reported that there was a Bond Sale meeting recently. He stated that there will probably be a cut in mortgage rates, in the near future, a fact which will give us a little more savings. Mr. Ferraioli stated that what we are looking at right now is that we will be refunding $ 6,285,000.00 of existing Bonds at a higher interest rate, and we will be issuing new money, of $2,191,800.00. He stated that $2,100,000.00 of that new money will be for new construction, which will bring the total Bond Sale to $8,476,801.50. Mr. Ferraioli then went over the new Debt Service Schedule with the Commissioners. Mr. Ferraioli concluded the discussions by stating that he feels at this time – which this is a home run in our favor. He stated that he has a resolution for this evening; Resolution #24-08 on the Consent Agenda, which is the application to the Local Finance Board.

Chairman commented that another way of looking at this is that out of the 2.1 million of new construction, the savings we are getting, roughly $400,000 is a down payment on that. Mr. Ferraioli agreed.

Mr. Ferraioli brought to the attention of the Commissioners that it would be greatly advisable to have a representative of this Authority present at the Bond Sale. He stated that the Chairman, Frank Covelli would be the ideal representative; as he would be able to represent both Boards that will be participating in this Bond Sale. Discussion ensued.

The Chairman asked Mr. Ferraioli if he was correct in remembering that at the meeting you had with representatives of both Boards, if he stated that the Local Finance Board likes to see a savings of approximately 3%. The Chairman then asked what % of savings are we at. Mr. Ferraioli responded that we were closer to 5.3 %, which is well over their preference. Mr. Ferraioli stated that he recommends this Board approve a resolution submitting an application to the Local Finance Board, for approval of this Bond Sale.

The Chairman stated that as someone who also was present at the Bond Counsel Meeting, that he would like to commend both Mr. Miller and Mr. Ferraioli on a job well done. Mr. Miller and Mr. Ferraioli thanked the Chairman for his kind words.

The Chairman then asked Mr. Ferraioli what the next step should be. Mr. Ferraioli stated that the resolution he had entitled " RESOLUTION OF THE WANAQUE VALLEY REGIONAL SEWERAGE AUTHORITIY MAKING APPLICATION TO THE LOCAL FINANCE BOARD PURSUANT TO N.J.S.A. 40A:5A-6"

Mr. Miller then read the following resolution aloud:

WHEREAS, the WANAQAUE VALLEY REGIONAL SEWERAGE AUTHHORITY desires to make application to the Local Finance Board for its review and/or approval of a proposed resolution authorizing the issuance of bonds to (i) fund certain capital projects and (ii) refund all or a portion of the Authority's outstanding 1998 Bonds.

REPORTS

Accounting Cont.

WHEREAS, THE WANAQUE VALLEY REGIONAL SEWERAGE AUTHORITY believes:

(a) It is in the Public interest to accomplish such purpose;

(b) said purpose or improvements are for the health, wealth, convenience and betterment of the inhabitants of a local unit or units;

exorbitant;

(d) the proposal is an efficient and feasible means of providing services for the needs of the inhabitants of the local unit or units and will not create undue financial burden to be placed upon the local unit or units;

NOW THEREFORE, be resolved by the WANAQUE VALLEY REGIONAL SEWERAGE AUTHORITY as follows:

Section 1. The application to the Local Finance Board is hereby approved, and the Auditor, Attorney, Bond Counsel and financial advisor, along with other representatives of the Authority, are hereby authorized to prepare such application and to represent the Authority in matters pertaining thereto.

Section 2. The Secretary of the Authority is hereby directed to prepare and file a copy of the proposed resolution the Local Finance Board as part of such application.

Section 3. The Local Finance Board is hereby respectfully requested to consider such application and to report its findings, recommendations and/or approvals as provided by the applicable New Jersey Statue.

MOTION Moved by Andrew Bolduc, 2nd by Robert Moshman to adopt Resolution #24-08 approving submittal of the above stated resolution entitled "RESOLUTION OF THE WANAQUE VALLEY REGIONAL SEWERAGE AUTHORITY MAKING APPLICATION TO THE LOCAL FINANCE BOARD PURSUANT TO N.J.S.A. 40a:5A-6"

On Roll-Call Commissioners Bolduc, Moshman, Murray and Covelli voted yes.

Commissioners Bigger and Hadley were absent.

MOTION CARRIED

Mr. Ferraioli stated that on the Consent Agenda there were two resolutions - the Audit Report Corrective Action Plan and Audit Report Review Certificate for your approval. Mr. Ferraioli went over the Audit Report Review Certificate and explained that there were signatures required along with the adopted Resolution.

At this time the chairman declared that there would be a recess.

The recess started at 6:53 PM and was concluded at 6:58 PM

The Chairman stated that we are now back on the record and asked Mr. Ferraioli if he had anything further to report. He then asked if any of the Commissioners had any questions for Mr. Ferraioli. Upon hearing no response the Chairman thanked Mr. Ferraioli and asked for the Engineer's report.

Engineering

Mr. Kelly stated that at the last meeting we had a discussion with regard to a small piece of the future Capital Improvements Project and he stated that they would like to get started on at. Mr. Kelly stated that it was for additional aeration in the oxidation ditches and that they would like to get them on line for the summer, during the peak months of July and August. Mr. Kelly stated that at the last meeting he indicated that the Engineering fees would not exceed $15,000 and he stated that he memorialized that in the form of a proposal, copies of which he distributed to the Commissioners. Mr. Kelly went over the report with the Commissioners. Mr. Kelly stated that at the last meeting he sensed that the Board's consensus was with our

thinking and was in agreement with this; therefore, we have already begun working on the project. Mr. Kelly stated that that was all he had to report this evening and if it were appropriate for the Authority to take action tonight that would be fine, but if it needed to be held until the next meeting he would understand.

The Chairman stated that as this is just a memoralization of everything you have outlined at the last meeting and giving the time frame that Mr. White wants to work within, which he concurs with, he would ask the Commissioners that we add this to the Consent Agenda and stated that it would be Resolution #27-08 -Authorizing the Engineer to proceed under the Oxidation Ditches Additional Aeration project.

The Chairman polled the Commissioners, but stated that he would not take a vote as we just agreed to add this to the Consent Agenda.

The Chairman asked Mr. Ferraioli if would be correct to charge this Engineering cost – is it something we can put on the Bond Sale, even though we are authorizing it before the actual Bond Sale. Mr. Ferraioli stated if this was part of the Capital Improvement Program it would be acceptable.

Mr. Kelly stated that his report was completed. The Chairman asked the Commissioners if there were any questions of Mr. Kelly. Upon hearing none the Chairman asked for the Legal Report.

Mr. Kelly thanked the Commissioners for his reappointment.

REPORTS

Legal

Mr. Miller thanked the Commissioners for his reappointment.

Litigation

Mr. Miller reported that the Borough of Ringwood has adopted a resolution authorizing the settlement, by payment in full of the dollar amount that we expended in their behalf, for Wastewater Management Planning work, which is $12,632.50. Mr. Miller stated that he is waiting to hear from their counsel with regard to the formality of it and we will get it done. Mr. Miller stated that he believes he was authorized at a previous meeting to accept this payment in full. Mr. Miller stated that, therefore, there is no need for an additional resolution to authorize him to do so.

Bond Counsel

Mr. Miller reported that Bond Counsel is preparing a public announcement that we must make of the downgrading of our Bond Insurers, Financial Guarantee Insurance Co. He stated that they are the guarantor of our outstanding bonds and that they have been downgraded from AAA to AA rating and because that is a change in circumstances, under the regulations we have to make a public announcement to the Bond holders this has happened. Mr. Miller stated that it will not in any way affect our current Bonds. Mr. Miller stated it is the downgrading of Bond insurers and that it will be a consideration of who we take to insure the next Bond issue and that this is a decision we will work on with Bond Counsel at the time of the new Bond issue.

Mr. Miller stated that his report was completed.

The Chairman stated that with Mr. Miller's consent he would like two motions - one to accept the settlement from the Borough of Ringwood as contained in their resolution, which states the Borough of Ringwood has authorized as a settlement agreement with Wanaque Valley Regional Sewerage Authority to pay the sum of $12,632.50 and second to direct Mr. Miller, pending receipt of that amount, to dismiss the action and issue a release.

MOTION Moved by Andrew Bolduc, 2^nd by Robert Moshman to adopt Resolution # 28-08 authorizing Mr. Miller to accept, on behalf of the Wanaque Valley Regional Sewerage

Authority, the settlement from the Borough of Ringwood, as contained in their resolution, the amount of $12,632.50, and to further authorize Mr. Miller to dismiss the action and issue a release to the Borough of Ringwood.

The Chairman asked for all those in favor to signify so by saying Aye.

Commissioners Bolduc, Moshman, Murray and Covelli all stated Aye. There were no

Nays or Abstentions. Commissioners Bigger and Hadley were absent.

MOTION CARRIED

The Chairman stated the second motion would be for this Authority to authorize himself, the Chairman, to represent this Authority at the Local Finance Board meeting.

MOTION Moved by Andrew Bolduc, 2^nd by Robert Moshman to adopt a resolution authorizing

Frank Covelli, Chairman to represent this Authority at the Local Finance Board.

The Chairman asked for all those in favor to signify so by saying Aye.

Commissioners Bolduc, Moshman, Murray and Covelli all stated Aye. There were no

Nays or Abstentions. Commissioners Bigger and Hadley were absent.

MOTION CARRIED

Commissioners’ Terms of Office

Mr. Miller stated there is one minor issue that he has not yet addressed, but that he plans to, which is the Terms of Office of the West Milford appointees. Mr. Miller reported that Mr. Bigger was appointed for a term which they say will expire on December 31, 2008, while Mr. Elcavage’s term was to end January 31, 2009. Mr. Miller stated that all terms have always expired on January 31^st, which is set by statute governing this Authority. Mr. Miller stated that he had planned on asking West Milford to extend Mr. Bigger’s term to reflect our statute requirements. Mr. Miller stated that the issue would then be that at that point we will have both Mr. Moshman’s and Mr. Bigger’s terms expiring on January 31, 2009. Mr. Miller stated that somewhere along the line we lost a year. Under normal circumstances the representatives terms from each community are staggered. Mr. Miller stated that he will work with the counsel for West Milford to get that organized and back on the right schedule.

OLD BUSINESS

The Chairman asked if there was anything to be discussed under Old Business. Upon receiving no response He stated he would move on to New Business.

NEW BUSINESS

The Chairman asked if there was anything to be discussed under New Business. Upon receiving no response He stated that he would now open the meeting to the public.

PUBLIC PORTION

The Chairman stated if there was anyone from the public that wish to address this Board to please step forward and identify themselves for the record.. As there was no one in the audience, the Chairman stated that he would entertain a motion to close the Public Portion of this meeting.

MOTION Moved by Andrew Bolduc, 2^nd by Patrick Murray to adopt a resolution authorizing

closing the Public Portion of the meeting.

The Chairman asked for all those in favor to signify so by saying Aye.

Commissioners Bolduc, Moshman, Murray and Covelli all stated Aye. There were no

Nays or Abstentions. Commissioners Bigger and Hadley were absent.

MOTION CARRIED

CONSENT AGENDA

The Chairman stated that the Consent Agenda , which has been modified and discussed during the meeting , is now before you and asked for a motion to accept the Consent Agenda as modified.

MOTION Moved by Robert Moshman, 2^nd by Patrick Murray to adopt a resolution adopting and approving all items on the modified Consent Agenda containing the following Resolutions.

No. 19-08 - Correspondences - 01-26-08 – 02-21-08

20-08 - January 30, 2008 Regular Meeting Minutes (with Corrections noted)

21-08 - Vouchers – M-10708 & M-10709 (FY ’07)

Vouchers – M-1710 thru M-10753 (FY ’08)

NOTE: Payment subject to availability of funds

22-08 - Audit Report Corrective Action Plan

23-08 - Audit Report Review Certificate

24-08 – Application to Local Finance Board

25-08 - Ringwood Settlement Acceptance (was noted separately on Page 4)

26-08 – Void Check # 12629, Voucher M-10722

27-08 – Authorize Engineer to proceed with the Oxidation Ditch additional oxidation project.

The Chairman asked for all those in favor to signify so by saying Aye.