Minutes: January 18, 2018

Call to Order

The regular meeting of the Vernon Township Municipal Utilities Authority (VTMUA) of the Township of Vernon was convened at 7:00 p.m. on Thursday, January 18, 2018 in the Vernon Municipal Center, 21 Church Street, Vernon, New Jersey.

Statement of Compliance

Adequate notice of this meeting had been provided to the public and the press on February 21, 2017 and was posted on the bulletin board in the municipal building in accordance with the Open Public Meetings Act, N.J.S.A. 10:4-6.

Roll Call

Thomas BuchneyP
Gloria GalloA
Paul KearneyP
John PerryP
Edward SegerP
Edward SnookP
Kristin WheatonP

Roll Call of Professionals

Executive Director John Scerbo, Auditor Charles Ferraioli, and Attorney Richard Wenner were present. John Scerbo reported Engineer Ceren Aralp was not able to attend due to the injury of a family member.

1. Sewer Rate Hearing

John Perry moved to open the sewer rate hearing.
Edward Seger seconded the motion.
All were in favor.
The rate hearing was opened.

Auditor Charles Ferraioli reported that the 2018 VTMUA budget is $2,738,275. It is $369,019 higher than last year. The increases in the budget are generated by the $100,000 increase in the SCMUA debt service, a $40,000 appropriation for a wastewater management plan, a $150,000 appropriation for the engineering design of pump station #2, and legal fees in the amount of $96,000 due to the Mountain Creek bankruptcy. Based on the VTMUA revenues, including Mountain Creek revenues per the deficit agreement, the 2018 budget calls for a $100 increase in the average rate, increasing from $1,080 to $1,180. Mr. Ferraioli reported the VTMUA user base for 2017 was 1,606 users. For 2018 so far, that has increased to 1,612. He said if the VTMUA could add 50 EDUs a year to the user base, it would help stabilize the rates.

Chairman Buchney asked Mr. Ferraioli to reiterate the VTMUA’s effort to stabilize the rates. Mr. Ferraioli said when they put the budget together they had a deficit agreement with Mountain Creek, which picks up 63% of the deficit and the VTMUA is required to fund the balance. To stabilize their rates this year at $100 and take advantage of the 63% deficit agreement with Mountain Creek they had to use an additional $100,000 in revenue that was available to the authority. He said when users connect to the Vernon system and they pay a connection fee to SCMUA, 60% of the SCMUA connection fee goes into a rate stabilization fund for Vernon.

No one from the public came forward to speak.

John Perry moved to close the sewer rate hearing to the public.
Edward Seger seconded the motion.
All were in favor.
The sewer rate hearing was closed to the public.

2. Open Meeting for Public Comment

Edward Snook moved to open the meeting to the public.
John Perry seconded the motion.
All were in favor.
The meeting was opened to the public.

No one came forward.

John Perry moved to close the meeting to the public.
Edward Snook seconded the motion.
All were in favor.
The meeting was closed for public comment.

3. Consent Agenda

A. Resolution 18-01: Authorizing the Payment of Bills for January 18, 2018

Thomas Buchney moved to approve Resolution 18-01 for payment of the bills.
Edward Seger seconded the motion.

Discussion: Kristin Wheaton said she had asked for a description of the items for payment to be provided. Mr. Scerbo said the names next to the items represent the companies paid, and the descriptions are in the vouchers for anyone who wants to review them. Edward Seger said he thinks it is a good idea to include a brief description. Mr. Scerbo said he would include it going forward.

Roll Call Vote:
Ayes: John Perry, Edward Snook, Edward Seger, Kristin Wheaton, and Thomas Buchney
Nays: None

B. Approval of December 21, 2017 Minutes

John Perry moved to approve the December 12, 2017 minutes.
Edward Snook seconded the motion.

Discussion: John Scerbo asked the secretary to check a comment attributed to him about the municipality having the authority to disband the VTMUA, which was in response to the question from Great Gorge Village resident Pat Lasorsa during the public portion of the meeting. Mr. Scerbo said he does not think he said that if a municipality were to disband the MUA, all the taxpayers, and not just the sewer users, would absorb the tax burden. Mr. Scerbo said Edward Seger had questioned that point in the minutes with him earlier. Mr. Seger also stated he does not think Mr. Scerbo said that. The secretary will listen to the recording for clarification.

In the last paragraph at the bottom of page 4 in the minutes, in which Paul Kearney questions the manholes behind PAL, Mr. Scerbo would like to add that he stated he had just had a conversation about that exact same matter with the mayor.

Attorney Richard Wenner recommended tabling approval of the minutes until the next meeting so the secretary could listen to the recording to verify what was stated and present her findings at the next meeting.

John Perry amended his motion to table the minutes.
Edward Snook amended his motion to second approval to motion to table the minutes.

Roll Call Vote:
Ayes: John Perry, Edward Snook, and Edward Seger
Nays: None
Abstain: Kristin Wheaton and Thomas Buchney

4. Correspondence

None

5. Adoption of 2018 Budget and 2018 Sewer Rate

A. Resolution 18-02: Approval of the 2018 Sewer Rates

Auditor Charles Ferraioli said under authority law, the VTMUA is supposed to introduce the budget 60 days before the year ends. He explained the VTMUA never does that because they do not get their final SCMUA bill until the end of November or early December.

The 2018 rate for an EDU is $1,180, an increase of $100 from 2017.

  • A 1-bedroom unit, which is .6 EDU, would be $708 annually or $177 quarterly, a $15 per quarter increase from 2017.
  • A 2-bedroom unit, which is .8 EDU, would be $944 annually or $236 quarterly, a $20 per quarter increase from 2017.
  • A unit with 3 or more bedrooms, which is 1 EDU, would be $1180 annually or $295 quarterly, a $25 per quarter increase from 2017.

Edward Seger moved to approve the 2018 sewer rate.
Thomas Buchney seconded the motion.

Discussion: None

Roll Call Vote:
Ayes: Kristin Wheaton, John Perry, Edward Snook, Edward Seger, and Thomas Buchney
Nays: None

B. Resolution 18-03: Approval of the 2018 VTMUA Budget

The 2018 budget reflects total revenues of $2,738,335.
Total appropriations, including any accumulated deficit, are $2,738,355.
The total capital appropriation is $75,000 and total unrestricted net position used is $0.00.

Thomas Buchney moved to approve the 2018 budget.
Edward Seger seconded the motion.

Discussion: None

Roll Call Vote:
Ayes: Kristin Wheaton, John Perry, Edward Snook, Edward Seger, and Thomas Buchney
Nays: None

C. Resolution 18-04: Late Introduction of the 2018 VTMUA Budget

Local authorities law requires every authority to transmit two certified copies of the budget to the director of Local Government Services at least 60 days prior to the end of the current fiscal year. The VTMUA is unable to do that because they had not gotten their final bill from the SCMUA. Therefore, it is necessary to adopt a resolution to do a late introduction.

Edward Snook moved to approve late introduction of the 2018 budget.
Edward Seger seconded the motion.

Discussion: None

Roll Call Vote:
Ayes: Kristin Wheaton, John Perry, Edward Snook, Edward Seger, and Thomas Buchney
Nays: None

D. Resolution 18-05: Adoption of Interlocal Services Agreement with Chief Financial Officer

The contract calls for $31,875 for 2018 and $32,500 for 2019. There is no provision in the contract for 2019.

Edward Seger moved to approve the adoption of interlocal agreement with the township CFO.
Kristin Wheaton seconded the motion.

Discussion: Edward Seger asked how the agreement changed from last year. John Scerbo said it is exactly the same. There was discussion on the amounts, which were amended.

After discussion, Edward Seger amended his motion to approve the interlocal agreement for administrative services and to reflect that it is a two-year contract that ends in 2019, not a three-year contract.
Kristin Wheaton seconded Mr. Seger’s amended motion

Roll Call Vote:
Ayes: Kristin Wheaton, John Perry, Edward Snook, Edward Seger, and Thomas Buchney
Nays: None

E. Resolution 18-06: Adoption of Interlocal Services Agreement for Administrative Services

The contract for administrative services shall be $50,490 for 2018 and $51,500 for 2019. There will be no third year in the contact.

Edward Seger moved to adopt the interlocal service agreement for administrative services with the amendment that the third year is stricken and it is a two-year contract for 2018 and 2019.
John Perry seconded the motion.

Discussion: None

Roll Call Vote:
Ayes: Kristin Wheaton, John Perry, Edward Snook, Edward Seger, and Thomas Buchney
Nays: None

F. Resolution 18-07: Appointing Risk Management Consultant

Edward Snook moved to appoint Skylands Risk Management Inc. as risk management consultant.
Thomas Buchney seconded the motion.

Discussion: John Scerbo said this is the third time he is sending the resolution to the risk management consultant because they keep losing it. Kristin Wheaton asked how the program works. Mr. Scerbo said it is a state program. The state requires municipal authorities to name a risk management consultant.

Roll Call Vote:
Ayes: Kristin Wheaton, John Perry, Edward Snook, Edward Seger, and Thomas Buchney
Nays: None

6. Attorney’s Report

Attorney Richard Wenner said he would reserve comment for executive session.

7. Engineer’s Report

A. Review of New Applications

Country Store, 317 Route 94—Block 148, Lot 12, .75 EDU

John Scerbo gave the report on the new application in Ceren Aralp’s absence. There will be a country store, a guitar studio, and a recording room at this location.

Kristin Wheaton moved to approve the application.
John Perry seconded the motion.

Roll Call Vote:
Ayes: Kristin Wheaton, John Perry, Edward Snook, Paul Kearney, and Edward Seger
Nays: None

B. Old Business

None

C. Status of Asset Management Loan Application

John Scerbo reported they are waiting to hear back from bond counsel whether or not he got a response from the attorney at NJEIT regarding the ability to switch the application for asset management from the VTMUA to the township and swapping positions. Instead of the VTMUA being the lead, they will be the collaborator and the township will be the lead. If it is approved, the money would go to the township and the township would give the money to the VTMUA.

D. Status of Sewer Expansion Study and Project Schedule

Engineer Ceren Aralp will make a presentation to the freeholder board in February. Mr. Scerbo is waiting for a confirmation on the date and time.

8. Executive Director’s Report

Executive Director John Scerbo reported he did some research on Dropbox technology. He had a lengthy conversation with the township’s IT contractor, who is doing research to help the VTMUA, which the VTMUA will pay for separate from the township. There are some problems with regard to the size of the documents and the number of documents they can store. Payment would be based on the volume of documents. There are also some security issues regarding placement and accessing of documents. Mr. Scerbo said he would report back to the commissioners when he gets additional answers so they can discuss further options.

9. Commissioners’ Comments

Edward Seger said he is not familiar with the EDU structure and asked for a matrix or table to better understand it. John Scerbo said the EDU rate is based on the use. Mr. Scerbo also stated the VTMUA goes directly by state statutes for sewer users. He will provide Mr. Seger a copy of the matrix from the state statutes. He also said the uses and EDU rates are based on what the users put on their applications. When there is a change in use, an applicant has to file the change, and the EDU rate is then reconsidered and amended if necessary.

Paul Kearney asked whether there are penalties imposed for users who change the use of their facilities but do not inform the VTMUA. Attorney Richard Wenner said it would be very difficult to police that. He said the zoning department should inform the VTMUA in changes of use.

Auditor Charles Ferraioli said that in other towns he represents, where there are older sewer systems, there are always illegal connections, but the municipality always finds them at some point. At that point they go back as far as they can to determine when the use had changed.

John Scerbo suggested their attorney look at the rules and regulations of the VTMUA to see what would apply if they found someone who failed to report a change in use. He said he has the authority to write a summons that is answerable in court for someone who fails to connect to the sewers, but he does not see anything that gives him the authority to write a summons for someone who fails to report a change in use.

Chairman Thomas Buchney said the VTMUA has been working with the zoning office over the past years for just these types of changes and violations.

John Scerbo said he and the building department and the finance office are looking at the ability for the building department to be able to do a query in the system to see when someone comes in whether certain blocks and lots are sewered.

Ed Seger said when John Scerbo puts together document to bring new and existing council members up to speed to where the VTMUA is today or other documents, he wants them to first be given to the VTMUA commissioners so that they have the opportunity to review them so nothing is misinterpreted. Mr. Scerbo said the request for the document to bring the council members up to speed was made to Chairman Buchney, and the chairman then requested Mr. Scerbo to write it. Mr. Scerbo then sent the document to Chairman Buchney and to VTMUA attorney Richard Wenner for their review. Mr. Scerbo said he had sent it to the VTMUA commissioners at the same time he sent it to the council members. Edward Seger said he had not checked his email. He asked Mr. Scerbo to send the commissioners text messages telling them to check their emails when Mr. Scerbo sends email to the commissioners.

Commissioner Paul Kearney suggested reviewing the VTMUA operations and maintenance (O & M) manuals to get them inline with existing and pending state laws concerning water so that if there are changes in the future they are in compliance with state water, sewer, and storm runoff guidelines. He said he can provide the pending bill for the commissioners, or they can access it online. Mr. Scerbo said most of what Mr. Kearney is referring to would be in the asset management plan the VTMUA is trying to get money to do. Mr. Scerbo asked Mr. Kearney to send him the bill he is referring to.

10. Chairman’s Comments

Chairman Thomas Buchney had no comments.

11. Executive Session

WHEREAS, the Open Public Meetings Act, N.J.S.A. 10:4-6 permits the exclusion of the public in certain circumstances; and

WHEREAS, this public body is of the opinion that such circumstances presently exist.

NOW, THEREFORE, BE IT RESOLVED by the Vernon Township Municipal Utilities Authority of the Township of Vernon as follows.

1. The public shall be excluded from discussion of and action upon the hereinafter-specified subject matter.

2. The general nature of the subject matter to be discussed is litigation and personnel matters.

John Perry moved to go into executive session at 8:11 p.m.
Edward Segar seconded the motion.

Roll Call Vote:
Ayes: Kristin Wheaton, John Perry, Edward Snook, Edward Seger, and Thomas Buchney
Nays: None

12. Close Executive Session and Return to Public Session

Edward Snook moved to close executive session at 9:08 p.m.
John Perry seconded the motion.

Roll Call Vote:
Ayes: Kristin Wheaton, John Perry, Edward Snook, Edward Seger, and Thomas Buchney
Nays: None

The VTMUA went back into public session at 9:09 p.m.

13. Executive Director’s Stipend

John Perry moved to pay Executive Director John Scerbo his allowable $1,395 stipend for opting not to take health benefits with the township.
Kristin Wheaton seconded the motion.

Roll Call Vote:
Ayes: Kristin Wheaton, John Perry, Edward Snook, Edward Seger, and Thomas Buchney
Nays: None

Kristin Wheaton moved to authorize attorney Richard Wenner to amend the contract to incorporate the waiver of health benefits and to authorize the chairman to execute the contract.
Thomas Buchney seconded the motion.

Roll Call Vote:
Ayes: Kristin Wheaton, John Perry, Edward Snook, Edward Seger, and Thomas Buchney
Nays: None

Adjournment

Edward Snook moved to adjourn the meeting at 9:11 p.m.
John Perry seconded the motion.
All were in favor.
The meeting was adjourned at 9:11 p.m.

The next meeting of the VTMUA will be on February 15, 2018 at 7 p.m.

Transcribed and submitted by Jessica Paladini
Vernon Township MUA Secretary