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HomeMy WebLinkAbout2022-06-28 Water Board Meeting MinutesMINUTES DEPARTMENT OF WATER SUPPLY COUNTY OF HAWAI`I WATER BOARD MEETING June 28, 2022 Liquor Control Conference Room, 101 Aupuni Street, Suite 230, Hilo, HI MEMBERS PRESENT: Mr. David De Luz, Jr., Chairperson Mr. Steven Hirakami, Vice -Chairperson Mr. Michael Bell Ms. Julie Hugo Mr. Pono Kekela Ms. Kea Keolanui Mr. Benjamin Ney Mr. Kenneth Sugai Mr. Keith K. Okamoto, Manager -Chief Engineer, Department of Water Supply (ex-officio member) ABSENT: Mr. Stephen "Kawena" Lopez, Water Board Member Director, Planning Department (ex-officio member) Director, Department of Public Works (ex-officio member) OTHERS PRESENT: Ms. Diana Mellon -Lacey, Deputy Corporation Counsel Ms. Nancy Cook -Lauer, West Hawaii Today Mr. Jeff Zimpfer (10:10 a.m.) DEPARTMENT OF WATER SUPPLY STAFF: Mr. Kawika Uyehara, Deputy Mr. Kurt Inaba, Engineering Division Head Ms. Candace Gray, Waterworks Controller Mr. Gregory Goodale, Chief of Operations Mr. Eric Takamoto, Operations Division Mr. Warren Ching, Energy Management Specialist Mr. William O'Neil, Jr., Water Service District Supervisor II, DWS Waimea Ms. Janet Snyder, Information & Education Specialist II (10:55 a.m.) 1) CALL TO ORDER — Chairperson De Luz called the meeting to order at 10:00 a.m. A quorum of eight members were in attendance. 2) STATEMENTS FROM THE PUBLIC - none Page 1 of 19 June 28, 2022, Water Board Minutes 3) APPROVAL OF MINUTES: Minutes of the May 24, 2022, Water Board Meeting ACTION: Ms. Hugo moved for approval of the May 24, 2022, Water Board Meeting Minutes; seconded by Mr. Ney and carried unanimously by voice vote. Minutes of the May 24, 2022, Public Hearing on the Proposed Water Rates ACTION: Mr. Bell moved for approval of the May 24, 2022, Public Hearing Minutes; seconded by Mr. Ney and carried unanimously by voice vote. Minutes of the May 25, 2022, Public Hearing on the Proposed Water Rates ACTION: Ms. Hugo moved for approval of the May 25, 2022, Public Hearing Minutes; seconded by Ms. Keolanui and carried unanimously by voice vote. 4) APPROVAL OF ADDENDUM AND/OR SUPPLEMENTAL AGENDA - None 5) WATER RATE STUDY: The current contract with the consulting firm of Harris & Associates is to determine water rates for the Department for the Fiscal Year 2023 to Fiscal Year 2027 periods. The proposed water rates for Fiscal Year 2023 and Fiscal Year 2024 under the existing rate structure, is an increase of 9.5% each year for the consumption and standby water rates. Proposed water rates for subsequent years would include evaluation of other rate structure options that were previously discussed with the Water Board. The Water Board conducted public hearings on the water rates on May 24, 2022, 6:00 p.m., Hawaii Standard Time, at the West Hawaii Civic Center, Building G, 74-5044 Ane Keohokalole Highway, Kailua-Kona, Hawaii, and May 25, 2022, 6:00 p.m., Hawaii Standard Time, at the Aupuni Center Conference Room, 101 Pauahi Street, Suite 1, Hilo, Hawaii, to accept testimony on the proposed rate increases. There were no public testimony at these meetings; and the public hearings concluded after the presentations by the Harris & Associates consultant team, Ann Hajnosz and Karyn Johnson. Department recommends that the Board approve proposed water rate increases of 9.5% each year, for Fiscal Year 2023 and Fiscal Year 2024 under the existing rate structure for the consumption and standby water rates, to be effective July 1, 2022, and July 1, 2023. MOTION: Mr. Ney moved for approval of the recommendation; seconded by Mr. Sugai. Mr. Hirakami asked if this would presumably be at the start of Fiscal Year 2023 and would raise the $2.48 rate by 9.5%, making it $2.71. The Manager -Chief Engineer replied that the 9.5% increase is on the consumption and standby water rates, going into effect July 1 of this year and July 1 of 2023. If he heard the question correctly, Mr. Hirakami is asking about the power cost charge, which is independent of the water rate study and is next on the agenda today. Public hearings are held for that charge. Mr. Hirakami apologized that he was getting the two confused and asked for a refresher of the proposed rates. Ms. Gray referenced the Proposed 2-Year Rate Schedule that was part of Harris & Associates' presentation to the Board at its March meeting. It includes the current and proposed standby and consumption charges. Page 2 of 19 June 28, 2022, Water Board Minutes The Manager -Chief Engineer reviewed that there are other components to the water bill. There is the Power Cost Charge and the Energy CIP Charge. For a typical water bill using about 400 gallons a day, with the current charges, a two -month water bill would be about $145.00. After this water rate increase, effective this July, that $145.00 will look like $155.00 per two -month bill, about $5.00 a month increase. Similarly, for July 1, 2023, that increase will take that $155.00 bill to $166.00 for an average water bill, about an $11.00 increase over two months. Chairperson De Luz suggested that this may be an opportunity for the new Board Members and the public to consider having a reference in the Minutes to the Exhibits or a document retrieval folder to make it easier for when something like this is referenced, it can be found in a document file. Otherwise, you have to go back to the Minutes. If there are any questions from the Board in relation to those exhibits, they can be directed to the Manager -Chief Engineer. There was also discussion during rate study presentations to address certain inequities in the current rate structure which will be incorporated into the next rate study. Another thing to mention is that just because there is a water rate study, does not mean there will be an automatic increase. The study looks for efficiencies and other areas where, theoretically, there could be a decrease if so merited. It may look like, to newer Board Members, that this is just making rates higher and higher, but there is still some catch-up in regards to COVID and other things such as operating efficiency and a conscious effort to beef up the CIP to hopefully be able to address expansion, although that is a tough one just to begin with. He asked if there were any other comments. Mr. Ney stated that he has been approached by commercial users of water, especially in his district, where they say it is no longer financially feasible to stay in business if the water rates go up. There have been some grant writing initiatives to help subsidize or provide funding for them to offset their costs; but in Kohala, with the ditch going down, something has to be done with looking at the agricultural rate structure because if there is going to be an increase to the general consumer, we should be fair about that and increase the rate on the agricultural rates. He added that he was surprised not more people participate in providing testimony to the Board on the water rates. He has not seen participation from the public since he has been on the Board. The Manager -Chief Engineer stated those were all great comments. He mentioned that what the Chairperson spoke of, looking at different rate structures, will be coming up further down in today's agenda. Also, the current proposed rate increases were covered in the presentation that Harris & Associates did back in March, which can be sent out to the Board again. Essentially, the big part of the rate study was to also make sure the Department has sound fiscal policies moving forward, having enough rainy day reserve funds, and making sure the debt service and debt liabilities are healthy. The two rate increases primarily address those policies; and then moving forward, the Department will propose to the Board that Harris & Associates be asked to do further work in looking at rate structures and things of that nature. The current proposed rate increases also apply the agricultural rates' standby and consumption charges. ACTION: There being no further questions, a roll call vote was taken on the Motion to approve proposed water rate increases of 9.5% each year, for Fiscal Year 2023 and Fiscal Year 2024, under the existing rate structure for the consumption and standby water rates, to be effective July 1, 2022, and July 1, 2023. Motion was carried with eight (8) ayes — Mr. Bell, Mr. Hirakami, Ms. Hugo, Mr. Kekela, Ms. Keolanui Mr. Ney, Mr. Sugai, and Chairperson De Luz; and one (1) absent — Mr. Lopez. Page 3 of 19 June 28, 2022, Water Board Minutes 6) POWER COST CHARGE: Departmental power costs from all power sources increased since the last Power Cost Charge rate was determined. The Department proposes to increase the Power Cost Charge from $2.34 to $2.48 per thousand gallons as a result of this increase. Power cost charges over the past two years were as follows: Effective PCC May 1, 2022 $2.34 March 1, 2022 $2.02 November 1, 2021 $2.15 June 1, 2021 $1.85 December 1, 2020 $1.71 August 1, 2020 $2.01 A Public Hearing will have been held prior to this Board meeting to accept public testimony on this change. It is recommended that the Board approve the increase of the Power Cost Charge from $2.34 to $2.48 per thousand gallons, effective July 1, 2022. ACTION: Mr. Sugai moved for approval of the recommendation; seconded by Ms. Keolanui and carried by roll call vote with eight (8) ayes — Mr. Bell, Mr. Hirakami, Ms. Hugo, Mr. Kekela, Ms. Keolanui, Mr. Ney, Mr. Sugai, and Chairperson De Luz; and one (1) absent — Mr. Lopez. 7) NORTH KOHALA: JOB NO. 2016-1045, CONSTRUCTION OF THE HALA`ULA WELL DEVELOPMENT - PHASE 2 - REQUEST FOR TIME EXTENSION: The contractor, Goodfellow Bros., LLC, is requesting a time extension of an additional 92 calendar days to obtain the Pump Installation Permit and subsequently complete the installation of the pump equipment and piping. The completion of the project will also depend on the completion of Hawaiian Electric power being installed to the well site. Ext. From (Date) To (Date) Reason (Ca eBays 1 ' 131 202 7�31/2021 255 Excess delays due to land ownership 020 11/1 changes and lack of site access. 11 Q /2020 Delay in receiving the pump installation �,1 nr�z� 7/31/2021 2 11/30/2021 122 permit from the Commission on Water Resource Management CWRM). 3 11/30/2021 2/28/2022 90 Delay in receiving the pump installation ermit from CWRM. Delay in receiving the pump installation 4 2/28/2022 6/30/2022 122 permit from CWRM and power from Hawaiian Electric. Delay in receiving the pump installation 5 6/30/2022 9/30/2022 92 permit from CWRM and power from Hawaiian Electric. Total Days(including this request) 681 Page 4 of 19 June 28, 2022, Water Board Minutes The contractor has not received the Well Pump Installation Permit which is required to begin the installation of the pump. Hawaiian Electric has begun installing power lines up Hala`ula-Maulili Road to bring power to the well and reservoir site. These delays are beyond the control of the contractor. Staff reviewed the request for the contract time extension and finds the request for the additional 92 calendar days to be acceptable. Note: There are no additional costs associated with this time extension. The Manager -Chief Engineer recommended that the Board approve a contract time extension of 92 calendar days to Goodfellow Bros., LLC, for JOB NO. 2016-1045, CONSTRUCTION OF THE HALA`ULA WELL DEVELOPMENT - PHASE 2. if approved, the contract completion date will be revised from June 30, 2022, to September 30, 2022. MOTION: Mr. Ney moved for approval of the recommendation; seconded by Ms. Hugo. The Manager -Chief Engineer noted that the delay is due to the pump installation permit and getting power to the site. Progress is being made on both, but it is still not complete; therefore, the contractor requested this time extension. Staff s understanding is that Hawaiian Electric has the poles on site and they have to install them and put three-phase power on the poles. The State Commission on Water Resource Management (CWRM) is still processing the pump installation permit. The physical requirements of the well are in place, but the permit is needed to proceed with putting the pump down the hole. Mr. Ney asked if this kind of delay has to be accounted for in future projects. The time involved for the permit approval is over a year and a half, and this project is going on two years. The Manager -Chief Engineer agreed that it should not take an extra 681 days. He thinks what happened at CWRM is they made some process changes in how they administer these permits. Mr. Inaba added that COVID had something to do with it too because their staff was not in the office. There was also some work that had to be done to the well itself, which is included in the time extensions and was part of having to redo the permit. Mr. Hirakami asked if this is a State commission; and if so, who oversees that commission. The Manager -Chief Engineer replied that State commissions or boards are typically appointed by the Governor. This particular commission falls under the State Department of Land and Natural Resources (DLNR). The Chairperson is still the DLNR Chairperson. The person who oversees that body is a Deputy Director under the DLNR Chairperson. Mr. Hirakami wondered if they are aware of the problems. Chairperson De Luz stated that, unfortunately, this has been an issue with CWRM, but this one is extra ordinary. They are normally able to get permits out and not have it go this long. From what he has seen, it is anywhere from six months to a year. This one is highly unusual for it to be this long. The Manager -Chief Engineer stated that the Department will continue to follow up with their staff. Chairperson De Luz asked that the Board be kept updated. This project is in an area where back-up is needed, and the Board is very concerned for the public access and safety and health of providing water. It was noted that in the table on the agenda, there was an error in the "From" and "To" dates which are corrected shown in the table presented in these Minutes. ACTION: Motion was carried unanimously by voice vote. Page 5 of 19 June 28, 2022, Water Board Minutes a MISCELLANEOUS: A. DEDICATIONS: The Department received the following documents for action by the Water Board. The water systems have been constructed in accordance with the Department's standards and are in acceptable condition for dedication: Bill of Sale Sellers: Dennis Akamine and Kevin Iwasaki Tax Map Key (3) 2-5-009:021 Pi`ihonua, South Hilo, Island of Hawaii, Hawaii Facilities Charge: $6,095.00, Date Paid: 06/01/2022 Final Inspection Date: 05/27/2022 Water System Cost: $55,000.00 2. Grant of Easement and Bill of Sale Grantors: Diane O. Ito, Rockwell Okada, Guylon Okada and Clint Okada SUB-05-000182 Tax Map Key (3) 6-4-031:005 & 006 Pu`ukapu, Waimea, South Kohala, Island of Hawaii, Hawaii Facilities Charge: $73,140.00, Date Paid: 02/24/2021 Final Inspection Date: 06/03/2021 Water System Cost: $183,500.00 3. Second Amendment of Grant of Non -Exclusive Easement and Bill of Sale Grantor/Seller: State of Hawaii, Department of Transportation Tax Map Key (3) 7-3-043:003 (portion) Kalaoa Ist- 4' , North Kona, Island of Hawaii, Hawaii Facilities Charge: $6,095.00, Date Paid: 06/08/2022 Final Inspection Date: 01/11/2021 Water System Cost: $174,955.00 4. Bill of Sale Seller: Hilo International Airport Tax Map Key (3) 2-1-012:009 portion Waiakea, South Hilo, Island of Hawaii, Hawaii Facilities Charge: n/a, Date Paid: n/a Final Inspection Date: 06/07/2022 Water System Cost: $926,174.00 5. License Easement No. 511A Amendment (Non -Exclusive Right) Licensor: Department of Hawaiian Home Lands Tax Map Key (3) 1-5-010:004 & 003 Maku`u, Puna, Island of Hawaii, Hawaii Facilities Charge: $166,388.04, Date Paid: To be announced Final Inspection Date: 05/26/2022 Water System Cost: $625,000.00 Page 6 of 19 June 28, 2022, Water Board Minutes The Manager -Chief Engineer recommended that the Water Board accept these documents subject to the approval of the Corporation Counsel and that either the Chairperson or Vice -Chairperson be authorized to sign the documents. MOTION: Mr. Sugai moved for approval of the recommendation; seconded by Ms. Hugo. The Manager -Chief Engineer added the Date Paid for Item No. 5, which should be June 27, 2022. Chairperson De Luz announced that for Item No. 2, this family is related to him through marriage; therefore, he would like to recuse himself from the vote. He called for a vote on Items 1, 3, 4, and 5. ACTION ON ITEMS 1, 3, 4, AND 5: Approval of Items 1, 3, 4, and 5 was carried unanimously by voice vote. Chairperson De Luz turned it over to the Vice -Chairperson Hirakami to take the vote for Item No. 2. Vice -Chairperson Hirakami entertained a motion for approval of Item No. 2, Grant of Easement and Bill of Sale for Diane O. Ito, Rockwell Okada, Guylon Okada and Clint Okada. ACTION ON ITEM 2: Mr. Ney so moved; seconded by Ms. Hugo and carried by seven (7) ayes: Mr. Bell, Mr. Hirakami, Ms. Hugo, Mr. Kekela, Ms. Keolanui, Mr. Ney, and Mr. Sugai; one (1) absent: Mr. Lopez; and one (1) recusal: Chairperson De Luz. B. SERVICE CONTRACT NO. 2021-03, WATER RATE STUDY, FY22 - FY27- CHANGE ORDER TO THE CONTRACT: The current contract with Harris & Associates is to determine the Department's water rates for the periods of Fiscal Year 2023 through Fiscal Year 2027. The proposed water rates for Fiscal Year 2023 and Fiscal Year 2024, under the existing rate structure, includes an increase of 9.5% each year for the consumption and standby water rates. Proposed water rates for subsequent years would include evaluation of other rate structure options that were previously discussed with the Water Board. The purpose of this change is to prepare the additional rate structure analyses requested by the Department of Water Supply for implementation during the July 1, 2024, through June 30, 2027, time period. The proposed cost for this change would be an additional $105,662.00, which increases the contract amount from $117,000.00 to $222,662.00. The proposed schedule would also extend the current contract duration with a revision of the completion date from June 2023 to September 2024. RECOMMENDATION: It is recommended that the Board approve this change to the current contract with Harris & Associates, Service Contract No. 2021-03 Water Rate Study FY22-FY27 as described in the Proposed Addendum 1, Scope of Services, proposed by Harris & Associates. The change order will include the following: • Increase of contract amount by an additional $105,662.00, which will change the total cost for this contract from $117,000.00 to $222,662.00. • Extend the current contract duration with a revision of the completion date from June 2023 to September 2024. • Revise the Scope of Work and Project Schedule as described in the "Proposed Addendum L" The additional cost for this change order is included in the FY 2023 budget that was approved by the Water Board. The additional work is deemed warranted as it will involve the evaluation of data in the current system for potential changes to the rate structure requested by the Board, analyses of financial conditions after implementation of rate increases, internal and public communication, and attainment of financial policy targets to maintain a sound financial position for DWS. Page 7 of 19 June 28, 2022, Water Board Minutes MOTION: Ms. Keolanui moved for approval of the recommendation; seconded by Mr. Ney. The Manager -Chief Engineer stated that the scope of work includes looking at a new rate structure. The current rate structure is based upon meter sizes. More of the industry standard is to also look at, not only meter sizes, but category of use, residential, non-residential, commercial, etc. The request to have Harris & Associates do this work was initiated by this Board some time back. Staff has reviewed their proposal and price and found it to be acceptable and fair. Mr. Ney asked if Harris & Associates are the only consultants that the Department has used for water rate studies or have the contracts gone out to others. The Manager -Chief Engineer replied that other consultants have been used in the past. What the Department tries to do with procurement of professional services is to make sure they have experience with water utility rates, specifically water utility rate structures. Mr. Ney asked if the extra amount is due to extra time for them to collect data and compile presentations. The Manager -Chief Engineer replied that was correct. There will be extra work to try and come up with, essentially, a whole new rate structure for the Department, which will involve a lot of interaction with staff. Part of the evaluation will be whether the current billing system can handle a new rate structure. Ms. Gray noted that on the back of the addendum, there is a breakdown of the additional charges. Items 6 and 7 are about 43% of the increase as well as the communication with the Board, internally, and the rate study for five years. Ms. Hugo stated that she has found the presentations by Harris & Associates to be very valuable to her and they have an excellent communication style. She has appreciated their participation and presentations at the Water Board meetings. It has been very helpful. Mr. Hirakami stated he would like to see them taking into consideration the make-up of this island and the broad scope of the land. He noticed a lot of the rate study compares this island to Kauai or Oahu, but their land area is smaller and the distribution is way less. The Big Island has a unique geographic area and users are spread out so the delivery would be different. He wondered if they could consider a similar kind of demographic to the Big Island. For him, education -wise, he has found a lot of similarities with Alaska with lack of public education and the need for charter schools because their geographical area is so broad and there are a lot of rural communities. Kauai, Oahu, or Maui is like comparing apples to oranges to this unique island. The Manager -Chief Engineer stated that the consultant could be asked to consider Mr. Hirakami's suggestion. This island may be rather unique, but they can be asked if they have done something similar, as they do rate studies across the nation. Mr. Ney felt the same, that the presentation was based off different metrics and measures of the economy. To him, it did not necessarily feel very tailored to this island. The presentation was articulate and well -presented; but in terms of them giving the best recommendation might have been at this point like shooting from the hip until we see where the economy is going. Hopefully we are at an inflection point where the economy starts trending back up, but a lot of the presentation was them saying they might have to look at this again because they were not even sure. He thought there are Page 8 of 19 June 28, 2022, Water Board Minutes more factors at play and agreed with Mr. Hirakami that this island is a bit more unique than just basing it on the other water districts. The Manager -Chief Engineer stated that they have been doing it like this for a while; and in fact, Ms. Hajnosz is from Hawaii. One thing to remember is no matter what this island is compared against, even a typical rural setting like Alaska, they have different economic factors such as cost of materials and labor that go into a rate study. He believed the public wants to know how this island compares to others in the State, which is why he thought Harris & Associates used that as a comparison. However, it should not be a problem looping at other jurisdictions as well, but it is not as clear as apples to apples, oranges to oranges, even if that approach is taken. Chairperson De Luz mentioned two things he thinks are imperative in the rate study, and this goes to the general philosophy and culture of the commitment of the Department and this current Board that there is a foundation of a uniform service charge. Although Tasks 6 and 7 are to gather more baseline in regards to cost of service and rate structure evaluation, this Board and this Department have not looked at the cost of service by district or service facility. Otherwise, it would probably be too onerous in the more rural areas. What he would suggest, between staff and Harris & Associates, is you have an overall mission as far as purpose and function and that guides this study. But he did believe, from past conversations, that this will give more ethereal baseline information for what will be done moving forward. The Manager -Chief Engineer agreed and there are a fair amount of touch points with the Board as this process continues. Mr. Bell asked the Manager -Chief Engineer if he liked this company, to which he replied yes, he does. ACTION: There being no further discussion, Motion was carried unanimously by voice vote. C. MATERIAL BID NO. 2022-01, FURNISHING AND DELIVERING PIPES, FITTINGS, WATER METERS, FIRE HYDRANTS, BRASS GOODS, VALVES, ELECTRICAL SUPPLIES, ELECTRICAL EQUIPMENT, SCADA, WATER QUALITY EQUIPMENT, CHLORINATORS, MOTORS AND MISCELLANEOUS ITEMS FOR THE DEPARTMENT OF WATER SUPPLY STOCK: This item was deferred at the May 24, 2022, Water Board meeting. Bids were opened on May 4, 2022, at 1:30 p.m., and following are the bid results: PART DESCRIPTION BIDDER AMOUNT NO. I DUCTILE IRON PIPE, PUSH -ON TYPE Core & Main LP dba Pacific $86 800.00 JOINT Pipe Co., Inc. ' 2 DUCTILE IRON FITTINGS Core & Main LP dba Pacific $152,901.00 Pipe Co., Inc. 3 DUCTILE IRON SOLID BODY Core & Main LP dba Pacific $57,020.00 SLEEVES Pipe Co., Inc. 4 FLANGE GASKETS No Bids. 5 NUTS, BOLTS, AND THREADED Fastenal Company $76,423.12 RODS Page 9 of 19 June 29, 2022, Water Board Minutes PART DESCRIPTION BIDDER AMOUNT NO. 6 COPPER TUBING Core & Main LP dba Pacific $183,050.00 Pipe Co., Inc. 7 GALVANIZED PIPES T&C Core & Main LP dba Pacific $23 210.00 THREADED & COUPLED) Pipe Co., Inc. ' 8 METER BOXES M&H Investment Corp. dba $45,500.00 ICO Supply 9 METER COVERS Ferguson Enterprises, Inc. $19,017.50 10 AUTOMATIC METER READING UNIT Ferguson Enterprises, Inc. $98,638.80 11 SMART WATER METERS No Bids. 12 5/8" WATER METERS Badger Meter, Inc. $54,360.00 13 NEPTUNE T-10 SERIES METER PARTS Ferguson Enterprises, Inc. $96,661.00 14 BADGER RECORDALL SERIES Badger Meter, Inc. $4,306.39 METER PARTS 15 1 "- 2" WATER METERS Badger Meter, Inc. $10,427.80 16 COMPOUND WATER METERS Badger Meter, Inc.. $11,211.30 17 TURBINE METERS Badger Meter, Inc. $20,199.14 18 DETECTOR CHECK METERS Core & Main LP dba Pacific $5,170.00 Pipe Co., Inc. 19 FIRE SERVICE METERS Badger Meter, Inc. $62,366.24 20 FIRE HYDRANTS Core & Main LP dba Pacific $121,150.00 Pipe Co., Inc. 21 TAMPER -RESISTANT FIRE Core & Main LP dba Pacific $158,325.00 HYDRANTS Pipe Co., Inc. 22 MUELLER FIRE HYDRANT PARTS Ferguson Enterprises, Inc. $8,041.84 23 MUELLER FIRE HYDRANT Ferguson Enterprises, Inc. $10,342.43 EXTENSION KITS 24 M&H VALVE FIRE HYDRANT PARTS No Bids 25 BALL METER VALVES Core & Main LP dba Pacific $75,500.00 Pipe Co., Inc. 26 BALL VALVE, PACK JOINT X METER Ferguson Enterprises, Inc. $52,939.25 COUPLING / FIP 27 COMPRESSION JOINT COUPLING Core & Main LP dba Pacific $7,550.00 Pipe Co., Inc. 28 METER FLANGE COUPLING Ferguson Enterprises, Inc. $5,385.75 29 PACK JOINT COUPLING Ferguson Enterprises, Inc. $48,795.05 30 CORPORATION AND CURB STOPS — Core & Main LP dba Pacific $125,657.15 BALL TYPE Pipe Co., Inc. 31 PRESSURE REGULATORS No Bids 32 HOSE BIBBS No Bids 33 INVERTED MARKING PAINT Safety Systems & Signs $13,344.00 Hawaii, Inc. 34 AIR RELIEF VALVES Core & Main LP dba Pacific $17,400.00 Pipe Co., Inc. 35 SLOW CLOSING AIR/VACUUM No Bids VALVES 36 SILENT CHECK VALVES Core & Main LP dba Pacific $103,280.00 Pipe Co., Inc. Page 10 of 19 June 29, 2022, Water Board Minutes PART DESCRIPTION BIDDER AMOUNT NO. 37 DUCKBILL CHECK VALVES No Bids 38 GATE VALVES — 3" AND LARGER, Ferguson Enterprises, Inc. $47,939.36 125# CLASS 39 GATE VALVES — 3" AND LARGER, Ferguson Enterprises, Inc. $88,365.76 250# CLASS 40 AUTOMATIC CONTROL VALVES Ferguson Enterprises, Inc. $1,887,644.02 41 ROTARY PUMP CONTROL VALVES No Bids AND ACTUATION 42 RESERVOIR LEVEL INDICATOR TK Process Hawaii, LLC $11,118.29 43 HATCH FRAMES AND COVERS Core & Main LP dba Pacific $41,900.00 Pipe Co., Inc. 44 EMERGENCY EYEWASH/SHOWER Safety Systems & Signs $157,205.70 STATIONS Hawaii, Inc. 45 TOXIC GAS MONITORS No Bids 46 SIGNAL DEVICES Graybar Electric Company, $151,250.00 Inc. 47 ARC FLASH PPE — DAILY WEAR No Bids 48 SUPPLEMENTAL PPE Safety Systems & Signs $10,968.94 Hawaii, Inc. 49 ELECTRICAL GLOVES Safety Systems & Signs $1,222.48 Hawaii, Inc. 50 DIGITAL MULTIMETER & TESTING No Bids 51 ELECTRICAL SAFETY EQUIPMENT Graybar Electric Company, $4,270.00 Inc. 52 ELECTRICAL EQUIPMENT TESTING No Bids SERVICES 53 INDUSTRIAL MOTOR LEAD CABLE Graybar Electric Company, $140,840.00 Inc. 54 INDUSTRIAL CONTROL WIRING Graybar Electric Company, $12,105.00 Inc. 55 HEAVY-DUTY SAFETY SWITCH No Bids 56 SOLID STATE REDUCED VOLTAGE No Bids SOFT STARTER 57 MAGNETIC CONTACTORS No Bids 58 MEDIUM -VOLTAGE REDUCED TK Process Hawaii, LLC $115,491.43 VOLTAGE SOFT STARTER 59 VARIABLE FREQUENCY DRIVES TK Process Hawaii, LLC $5,395,265.87 60 POWER QUALITY EQUIPMENT TK Process Hawaii, LLC $303,127.92 61 PAD -MOUNTED STEP-UP No Bids TRANSFORMER 62 SURGE PROTECTION DEVICES TK Process Hawaii, LLC $89,620.94 63 POWER MONITORING EQUIPMENT No Bids 64 PROGRAMMING SERVICES No Bids 65A PRESSURE TRANSDUCER— WELL SCADA & Control Solutions, $39,650.71 LEVEL LLC Page 11 of 19 June 29, 2022, Water Board Minutes PART NO. DESCRIPTION BIDDER AMOUNT 66 PRESSURE TRANSDUCER- No Bids RESERVOIR LEVEL 67 PRESSURE TRANSMITTER TK Process Hawaii, LLC $4,762.56 68 FLOW SWITCH TK Process Hawaii, LLC $2,163.48 69 LEGACY ELECTROMAGNETIC FLOW No Bids METER PARTS 70 UNIVERSAL ELECTROMAGNETIC No Bids FLOW METERS 71 REAGENTLESS CHLORINE No Bids RESIDUAL ANALYZERS 72 WATER QUALITY EQUIPMENT No Bids 73 REAGENTS AND STANDARDS No Bids 74 MULTISTAGE BOOSTER PUMPS No Bids 75 CHEMICAL FEEDER PUMP No Bids 76 DIGITAL CHLORINE CYLINDER No Bids SCALE 77 CHLORINE GAS FEEDER No Bids 78 TABLET CHLORINATOR & PARTS No Bids 79 MECHANICAL SEALS No Bids 80 MOTORS No Bids 81 LEGACY LEAK NOISE DATA Wong's Equipment & $1 895.69 LOGGER & PARTS Services, LLC 82 LEAK NOISE DATA LOGGERS TK Process Hawaii, LLC $70,439.53 83 REMOTE PRESSURE MONITORING No Bids SYSTEM 84 LIGHT EMITTING DIODE Graybar Electric Company, $3,825.00 LUMINARIES Inc. 85 INDUSTRIAL LUBRICANTS No Bids For the Sections where no bids were received, staff shall seek alternative procurement pursuant to HAR 3-122-35 to procure the required materials in the best interests of the Department. The contract period for all Parts is one year, from July 1, 2022, to June 30, 2023. All Parts are established price agreements for materials on an "As -Needed Basis." The Manager -Chief Engineer recommended that the Board award the contract to the following bidders for MATERIAL BID NO. 2022-01, FURNISHING AND DELIVERING PIPES, FITTINGS, WATER METERS, FIRE HYDRANTS, BRASS GOODS, VALVES, ELECTRICAL SUPPLIES, ELECTRICAL EQUIPMENT, SCADA, WATER QUALITY EQUIPMENT, CHLORINATORS, MOTORS AND MISCELLANEOUS ITEMS FOR THE DEPARTMENT OF WATER SUPPLY STOCK, on an as -needed basis, as listed below, and that either the Chairperson or the Vice -Chairperson be authorized to sign the contract(s), subject to review as to form and legality of the contract(s) by Corporation Counsel. The contract period shall be from July 1, 2022, to June 30, 2023. Core & Main LP dba Pacific Pipe Co., Inc., for Parts 1, 2, 3, 6, 7, 18, 20, 21, 25, 27, 30, 34, 36, and 43 Fastenal Company for Part 5 M&H Investment Corp. dba ICO Supply for Part 8 Page 12 of 19 June 29, 2022, Water Board Minutes Ferguson Enterprises, Inc., for Parts 9, 10, 13, 22, 23, 26, 28, 29, 38, 39, and 40 Badger Meter, Inc., for Parts 12, 14, 15, 16, 17, and 19 Safety Systems & Signs Hawaii, Inc., for Parts 33, 44, 48, and 49 TK Process Hawaii, LLC, for Parts 42, 58, 59, 60, 62, 67, 68, and 82 Graybar Electric Company, Inc., for Parts 46, 51, 53, 54, and 84 SCADA & Control Solutions, LLC, for Part 65A Wong's Equipment & Services, LLC, for Part 81 MOTION: Mr. Sugai moved for approval of the recommendation; seconded by Mr. Bell. The Manager -Chief Engineer stated that staff did a tremendous job of compiling all of this. At the suggestion of the Board, a summary was made at the end to show which company is awarded which parts. As a refresher, this item had to be deferred last month because several of the potential awardees were not fully compliant with the Hawai `i Compliance Express, which is a necessary part of awarding the contract to them. All of those companies are now compliant and this can move forward. Chairperson De Luz asked if staff could explain what this contract attempts to accomplish, for the benefit of the newer Board members, because it is quite extensive. Mr. Goodale explained that, as seen from the comprehensive chart provided, this bid is for various materials that are needed for the Department to perform the work that it needs to do on the system throughout the year. These are the various components, whether it is piping, instrumentation for various aspects of the pumping systems, the actual field apparatus, valuing, etc. This bid is done on an annual basis so that the Department has these materials available and to avoid having to do an individual purchase order. This is a blanket purchase order to allow the materials to be ordered throughout the year without having to go and get new quotes. Mr. Hirakami asked if it limits the Department, for instance, if Badger Meter were to run out of 5/8-inch meters, if it would preclude the Departinent from going to another vendor. The Manager -Chief Engineer replied that the Department has to comply with the contract. It is a two-way street; the vendor is being asked to commit to their price, but at the same time, the Department is committed to utilizing them for that particular material. Mr. Hirakami asked if they are given an estimate of how many of that item the Department would use throughout the year and they are supposed to supply them. Mr. Goodale replied that if, for some reason, they run out of everything, the Department is not going to be put in a position where it is not going to be able to get the material it needs. If, after going to that vendor and they do not have it, the Department can go to another vendor, but it has to start with the company on this list. Mr. Ney asked if the Department has pretty good inventory control to account for lead time on ordering because he notices there is a bit of lag time getting things shipped to Hawaii. Mr. Goodale replied that was a good point and that living in Hawaii, if you do not take those things into account, you are going to be sorry. Fortunately, everyone understands this and they keep close track, especially on the things they know have longer lead time to make sure orders are placed ahead of time if inventory is depleting. Page 13 of 19 June 28, 2022, Water Board Minutes Chairperson De Luz mentioned that he knows Mr. Goodale personally and that a significant part of his professional life has been in Alaska, and he really does have an appreciation for the logistics and special challenges here, so it is a good fit to have him on staff. He added that as a matter of updating the newer Board members, the Manager -Chief Engineer might want to provide updates on the initiatives the Department is taking with looking into upgrading meters, efficiencies in leak management control, energy efficiency, etc., He hoped that, in working with Vice -Chairperson Hirakami, he could incorporate this into something that can be more of a report basis. ACTION: Motion was carried unanimously by voice vote. D. MATERIAL BID NO. 2022-06, FURNISH BASE COURSE, SAND, COLD MIX HOT MIX, AND NO. 3F ROCK TO THE DEPARTMENT OF WATER SUPPLY: For the award of District III Part 3G to Grace Pacific, LLC, the item description on the Letter of Award was corrected from "Blended Material 60% 44 Sand and 40% No. 3F Rock (Cost per ton)" to "Hot Mix - County Mix IF (Cost per ton)" for a bid amount of $174.00. Chairperson De Luz asked if this is an informational item and no action is needed. (The Manager - Chief Engineer replied that was correct.) Chairperson De Luz also noted, for informational purposes, only because he is going through some renovations of his own, he did not know where the Department is getting its aggregate from because he is not getting his. Apparently, there are issues at Y&S Rock and others that are making certain aggregate. He cannot get 6-inch Minus right now because most of it is going for concrete, which, in his case, is a three-month lag. Logistically, the Department might want to give some latitude in these contracts as supply issues continue. His understanding is it is going to be this way probably until the end of 2023. The Manager -Chief Engineer thanked him for that information and it will be kept in mind when ordering materials. E. MONTHLY PROGRESS REPORT: The Manager -Chief Engineer provided an update to the South Kohala, Lalamilo 10-MG Reservoir item. The contract has been executed and Notice to Proceed has been issued. For the Board's information, in this upcoming Legislative Session, he plans to go back to see if there any opportunities to get additional funding for that particular project. As reported previously, Senator Lorraine Inouye helped the Department get $8.75 million for this project. The bids came in at over $18 million, and he will be working hard to try and lessen that gap. Mr. Inaba added that the Department has to fund 20% as a requirement for the matching funds. Mr. Ney asked about the Hala`ula Well Development, Phase 2, and how the paving of the road came about. He remembered that, originally, it was not going to be paved all the way up and it is a private road. The Manager -Chief Engineer and Mr. Inaba explained that there were some contract contingency funds available, and they worked with the contractor, who also participated. Upon hearing complaints about the road from the community, the contractor paved the road because it was hard to tell what additional damage had been done to the road while construction was ongoing, even though it was not a very nice road to begin with. Nothing was done to benefit any particular party. It is for the overall benefit of the community; and fortunately, the contractor was very fair about it. Page 14 of 19 June 28, 2022, Water Board Minutes Mr. Ney stated that it was a nice gesture. The Manager -Chief Engineer stated that a lot goes to Mr. Inaba and his staff for having a good working relationship with the contractor. F. REVIEW OF MONTHLY FINANCIAL STATEMENTS: Ms. Gray reviewed the May 2022 financial statements. Approaching the end of the fiscal year, the Department's cash situation improved due to a $1,008,442.00 reimbursement for past projects related to the 2006 Kiholo Bay Earthquake Disaster. Mr. Hirakami asked if the Department has ever considered billing monthly rather than bi-monthly. With recent increases and the proposed increases, people are seeing higher water bills; and it might be easier to pay a bill if it is under $100.00 rather than $160.00 and may decrease delinquencies. The Manager -Chief Engineer replied that it has been looked at that in the past, but it is not as easy as one might think. The challenge would be the Department's manpower resources as far as reading of the meters, plus the postage costs would increase with monthly bills. Ms. Gray noted that operational expenses would probably increase. Mr. Hirakami asked about the possibility of doing a monthly average of their bi-monthly bill and then true it up on the bi-monthly reading. It could be read every other month but kind of do it on a true -up scale. It was just a thought. He recalled when his water bill used to be very low. Water is still affordable; but for some people, it might be more affordable if they set it monthly. Mr. Ney added that if the meter were read more frequently, leaks would probably be caught sooner. It would be a benefit to the customer not having their line leaking for two months. The Department ends up eating 50% when adjustments are applied for. He asked if that was ever factored in. He could see the Department's side about labor costs to read monthly, but it may be something to think about. The Manager -Chief Engineer stated that the Department offers online bill payment and does not charge the service fee for using that service. If your bill is $100.00, you only pay that amount and not a credit card fee. People can also make incremental payments. They can pay once a month if they want. He did not see any issues with that. Chairperson De Luz recalled one of the Department's initiatives was automatic read meters. As a follow up, perhaps it might be prudent for Ms. Gray to work with Harris & Associates to get an insight of whether there needs to be a policy re-evaluation on this matter as far as having capacity given to personnel in how to offer payment options to the rate payer. An example would be his own AT&T bill where they give different options where you could pay half of the bill now and so forth, from a point of managing on a case -by -case basis, but given the authority within policy to manage. Essentially, the whole context is in revolving credit, like a 20- to 25-day cycle. This might be an opportunity to give more flexibility from the policy side if a case is seen where someone could be helped by something like that, you have the tools to do it. The Manager -Chief Engineer appreciated the discussion. It may be deviating a bit from the agenda. Chairperson De Luz agreed and asked if there were any other questions on the Financial Statements. There were no further questions. Page 15 of 19 June 28, 2022, Water Board Minutes G. MANAGER -CHIEF ENGINEER'S REPORT: The Manager -Chief Engineer provided an update on the following: North Kona Wells — the Deputy reported that for this month for North Kona, ten of the fourteen sources are operating. Earlier in June, Hualalai Well went offline. The well is situated between Palani Road and Makalei Fire Station, the northern side of the Kona water system, which is why a 25% water restriction notice was issued for those areas. The other wells still offline are Kalaoa, Wai`aha, and Makalei. Wai`aha Well is still in litigative hold. For Makalei Well, the new owner/developer of that property and the well are pushing for their consultants to finish up the repair documents and get them approved by DWS before they get it out to bid. The Manager -Chief Engineer, at the request of the Council Member from the area, provided the Board, and the general public, an update on the Kona Water Restriction. He asked Mr. Goodale to provide more detail on the status of two of the wells, Kalaoa and Hualalai. Mr. Goodale reported that for the Hualalai Well, delivery of the motor, which is expected tomorrow, came about through a partnership between this Department and the Honolulu Board of Water Supply. In working with them to get a contact, the motor is actually coming from Las Vegas Valley Water utility. They provided a motor, and the agreement is that this Department will send a new motor back to them. Through that network within the State, we were able to get this motor in an expedited fashion to help get that well back online. For the Kalaoa Well, completion of the installation of the column pipe took place. Fortunately, the Department had a spare power cable which was used to get this well up and running. As of today, the well is in the testing period with the Department's Microlab personnel awaiting test results of the water. It is hoped to have that well pumping by this Thursday at the latest. That should have an impact on the water restriction for the area. The Manager -Chief Engineer mentioned his Letter to the Editor where he explained how the Department operates, which is to be conservative. You do not want to wait until people are running out of water before you say cut back on water now. The restriction notice did draw some criticism because it does impact people's daily lives. To have fourteen wells in any system is a lot. To have four out of fourteen wells offline would not be too bad if the four were spaced apart throughout the system. In this particular incident, three of the four were all next to each other in the northern -most end of the system. What that resulted in was a bottleneck of the capacity of the booster pumps to allow water to be pushed from the south to the north. That is really what put this into a water restriction situation, and he tried to explain that in the Letter to the Editor. What Mr. Goodale had mentioned about getting the motor from Las Vegas Valley Water was part of a Hawaii Water Agency Response Network (HIWARN) that the Department is part of which includes national networks. The Manager and Chief Engineer of the Honolulu Board of Water Supply, Mr. Ernest Lau, was the Chair of HIWARN, when he reached out to them for assistance. When Mr. Lau was contacted, he reached out to the national network on the western region side; and fortunately, Las Vegas Valley Water had something we could use. First, we reached out locally to private water systems and other water utilities within the State but were not successful finding something we could use. This all worked out and is enabling this repair to be completed ahead of schedule. Part of this agreement is to replace the equipment we are receiving from them. For Kalaoa Well, it was fortunate that we did have a spare cable on hand. When that well goes back online, the plan is to run it for a while to make sure it is operating fine. If so, it is likely that the water restriction will be reverted back to a 10% water conservation, which has been in place in the area for a while now. Part of the strategies moving forward are not to put in 1,400 gpm, two -million gallons a day wells; and for well repairs, we have been sticking with the one -million Page 16 of 19 June 28, 2022, Water Board Minutes gallons per day wells; however, the result of that is we lose pumping capacity. Part of the Department's efforts moving forward is to add two new sources to the fourteen to make it 16 sources for the North Kona Water System, and are hoping the Commission on Water Resource Management allows two wells to be installed. Mr. Ney asked how the water restriction is enforced or if it just goes by scouts honor. The Manager -Chief Engineer replied that the Department relies on people's good will. The last time the Department went through this in 2017, there was not a large reduction in use. Aside from the restriction notice, Operations did mobilize message boards as a reminder to people in the area. Mr. Ney asked if it has ever been so dire that the Department had to go out and shut meters off. The Manager -Chief Engineer replied that last time, the Department was looking at restricting flow to some who were utilizing thousands of gallons a day. The Department tried to reach out to them individually. 2. COVID-19 Update — the Manager -Chief Engineer reported that the Department is in same boat like everyone else, trying to encourage staff to continue to use best practices, and continuing to have impacts due to exposures, which affects manpower resources. 3. Update on Establishment of Permitted Interaction Group Re: Capacity Expansion — the Manager -Chief Engineer reported that this is placed on the agenda every month for the Permitted Interaction Group (PIG) to provide updates. He turned it over to Ms. Mellon -Lacey. Ms. Mellon -Lacey reported that at the initial formative meeting, Mr. Ney was elected Chair, Mr. Hirakami is Vice -Chair; and Ms. Keolanui is the Recording Secretary. Ms. Keolanui stated that they are waiting for Mr. Lopez to return after this month and that the next meeting should be in July. Mr. Hirakami has already reached out to United States Department of Agriculture (USDA) Rural Development Agency and they are willing to speak to the group on what already has been done using the USDA Rural Development program, such as Andrade Camp and some in Kona. Chairperson De Luz noted that the only person who was not on the Board when this was initiated was Mr. Kekela and he updated him on how this PIG was established to look into capacity expansion and come back with a report for the full Board. Ms. Mellon -Lacey will help ensure that this is within the context of compliance. They had their initial meeting to set up governance and leadership and will move forward in their efforts. If there are any questions, his recommendation would be to direct them to Ms. Mellon -Lacey so there is no opportunity of any linked communications of any Board Members. 4. 2022 Keiki Water Conservation Poster Contest — the Deputy reported on the fourth annual poster contest for kindergarten through fifth grade, islandwide. This year, even with different school schedules due to COV1D, the Department received almost 400 entries from about 15 schools, public, private, and charter. Internally, the effort was spearheaded mostly by Mr. Jason Armstrong, Information and Education Specialist I. He also enlisted staff s help during the judging period and from the districts who collected entries across the island. The theme was `Be a Superhero, Waste Zero." There were a lot of very artistic, colorful, and expressive entries. There was a first and second place winner for each of the grade levels. The winners and images of the winning posters and all entries are on the Department's website. The Department hopes to continue to promote this as an outreach to the community. It is part of the overall water conservation outreach effort for the Page 17 of 19 June 28, 2022, Water Board Minutes Department, particularly to elementary -age students throughout the island to try to educate them on water conservation. Hopefully that translates as they become adults and start paying bills. Retiree of the Department of Water Supply — the Deputy reported that for this month, there is one retiree, Ms. Janet Snyder, who is the Department's Information and Education Specialist 11. As of July 1, she will be retired from the Department. She has been with us since 2008 until 2017 when she had a tenure with Mayor Harry Kim's administration; and in 2020, she came back as our Information and Education Specialist 11. He thanked Janet for her years of service. She does community service outside of this Department and he was sure she would continue to do so. Ms. Snyder thanked Deputy Uyehara, who is her supervisor, and the Manager -Chief Engineer, who is an old friend and to whom she owes a lot. She thanked all of her friends and colleagues and the Board, for whom she used to be secretary when she first started. She thanked her mentor, current secretary, Doreen, whom she learned much from and is grateful to. She promised she would not disappear and perhaps might want to be a board member someday. The Board and staff congratulated Ms. Snyder on her retirement. Chairperson De Luz announced that Mr. Hirakami had a follow-up question and was wondering if the Board could be updated on the initiative for the Department of Hawaiian Home Lands person on the Board and for the Board Members to be required to go through Hawaiian Law training and how that went. The Manager -Chief Engineer stated that he could place it on the agenda for next month as it was not included here. Ms. Mellon -Lacey agreed that sounded much better. It is an item of interest to the public and really needs to be on the agenda so people have the opportunity to know about it. H. CHAIRPERSON'S REPORT: Chairperson De Luz spoke about Vice -Chairperson Hirakami's being tasked with initiating the Manager -Chief Engineer's evaluation for 2022. To his understanding, Mr. Hirakami can elect to have one other board member participate with him without having to create another Permitted Interaction Group. (Ms. Mellon -Lacey replied that was correct.) With that, there was interaction with the Manager -Chief Engineer earlier in the year where he presented a voluminous strategic plan and vision, which Mr. Hirakami is very familiar with for performance -based analysis and getting it to more of a report format for when the evaluation by the Board comes back around. He will be working with the Manager -Chief Engineer and whomever he would like to have help from. He suggested some tentative dates for the evaluation, perhaps working backwards from having the process culminate no later than the November board meeting in the event there is anything that was missed, it can at least be done by the end of the calendar year. This process will give a better understanding of the Manager -Chief Engineer's expectations of the Board and the Board's expectations of him. 9) ANNOUNCEMENTS: The next meeting of the Board will be July 26, 2022, 10:00 a.m., at the Liquor Control Conference Room, Hilo Lagoon Centre, Room 230, Hilo, Hawaii. Chairperson De Luz asked the Secretary to send out a second time, the schedule of Water Board Meetings for the remainder of the year. Page 18 of 19 June 28, 2022, Water Board Minutes 10) ADJOURNMENT ACTION: Ms. Hugo moved to adjourn the meeting; seconded by Ms. Keolanui and carried unanimously by voice vote. (Meeting adjourned at 11:36 a.m.) Recording Secretary APPROVED AS CORRECTED BY WATER BOARD, JULY 26, 2022 Page 19 of 19 June 28, 2022, Water Board Minutes