Minutes: March 16, 2017

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, March 16, 2017 in the Vernon Senior 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 16, 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 GalloP
Paul KearneyP
John PerryP
Edward SegerP
Edward SnookP
Kristen WheatonA

Roll Call of Professionals

Attorney Richard Wenner, Engineer Ceren Aralp, Auditor Charles Ferraioli, and Executive Director John Scerbo were present.

1. Oath of Office

Attorney Richard Wenner administered the oath of office to new VTMUA member Paul Kearney, who serves as Alternate #2 until February 2020.

2. Public Comment

Edward Snook moved to open the meeting to the public.
Edward Seger seconded the motion.
All were in favor.
The meeting was opened to the public. No one came forward.

3. Close Meeting for Public Comment

Edward Snook moved to close the meeting to the public.
Edward Seger seconded the motion.
All were in favor.
The meeting was closed to the public.

4. Consent Agenda

A. Resolution 17-24: Authorizing the Payment of Bills for March 16, 2017

Edward Snook moved to approve Resolution 17-24.
Edward Seger seconded the motion.

Discussion: None

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

B. Approval of February 16, 2017 Minutes

Edward Seger moved to approve the minutes.
John Perry seconded the motion.

Discussion: None

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

C. Resolution 17-17: Authorizing Payment of Non-Discretionary Emergent Bills Less than $500

This resolution was on the agenda of the February 16, 2017 reorganization meeting, but it was tabled to revise the wording “Emergent” in the original resolution. The word “Emergent” was removed from the resolution and replaced with “Reoccurring.”

Edward Seger moved to remove the resolution off the table.
John Perry seconded the motion.

Discussion: Attorney Richard Wenner said this resolution authorizes the executive director to pay regular reoccurring bills less than $500.

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

Motion to Amend and Adopt Revised Resolution 17-17

Edward Snook moved to amend the resolution.
Gloria Gallo seconded the motion.
All were in favor.

Edward Snook then moved to adopt Resolution 17-17 as amended.
Edward Seger seconded the motion.

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

5. Attorney’s Report

Attorney Richard Wenner said he had two matters for executive session.

A. Litigation Regarding the VFW

B. Attorney-Client Privilege Regarding Maintenance of the Sewer Lines and Rules and Regulations of the VTMUA

6. Auditor’s Report

Auditor Charles Ferraioli said he is currently conducting the audit for the VTMUA. He expects it to be finalized by the end of April. He also said he met with members of the VTMUA and the township council concerning the Remington & Vernick financial report regarding the sewers. Edward Seger said the report was not necessary wrong, but it does not take into account any of Mountain Creek’s payments and also suggests the VTMUA should have $1 million in reserve. The report does not take into consideration any potential new growth in the township.

Executive Director John Scerbo said the VTMUA has about $200,000 set aside in reserve for emergencies and asset management repairs. He said that is a reasonable amount, given the size of their system and the ratepayer base and the current revenues they get.

Mr. Scerbo said he did some calculating and said had the VTMUA set the rate at $2,500 in 2012-2013 there would be no financial problem today, even with the current number of EDUs. He compared that number to Remington & Vernick’s calculation of $2,600. He said the Remington & Vernick report does not calculate or take into account any funds coming from Mountain Creek at all. He said they treat it as though it does not even exist, and stated therefore their projections are not relevant because there is money coming from Mountain Creek.

Mr. Scerbo said there is another issue in which Remington & Vernick says multiple times in their report that the township is responsible for the deficit, and that is not accurate. The only responsibility the township has is if the bonds were to go into default. Other than that, the ratepayers have been paying for any deficits, he said, because Mountain Creek is responsible for the 63% and the ratepayers are responsible for the 37%. He said the VTMUA has received the first check of $406,000 from Mountain Creek. That did not include the piece Mountain Creek owes the VTMUA for one-fifth of the five-year amount deficit, and the attorney is in the process of sending them a letter asking for that amount, which is about $100,000.

Chuck Ferraioli said as long as Mountain Creek lives up to its agreement and the VTMUA sees some type of expansion and they can get 25 new EDUs a year, they could “take a lot of bite” out of the yearly rate increase to users. If they get 50 new EDUs, the rate would stabilize, he added. A single EDU is $1,080 a year.

Mr. Scerbo said he got two more phone calls today from people who want to buy property to start businesses, as he gets calls often, but they will not do it without sewers. Thomas Buchney suggested Mr. Scerbo start logging those calls that he gets.

7. Engineer’s Report

A. New Applications

Ceren Aralp reported there is a new application, a coffee shop where the Snap Fitness was at Block 143, Lot 19. The application is under review.

Mr. Scerbo also reported a new restaurant, a sushi bar, is coming to the Acme Plaza.

B. Old Business—None

8. Executive Director’s Report

A. Executive Director John Scerbo said there was a clogged pipe at pump station #3, which became submersed. Earthcare was called in to pump it down.

B. The schedule of meetings for 2017 that was advertised contains an error. The September 14 meeting should have been September 21. Mr. Scerbo has already readvertised the correct meeting date.

Edward Seger then moved to change the meeting from September 14 to September 21.
Edward Snook seconded the motion.

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

C. At the February meeting the VTMUA authorized Engineer Ceren Aralp to pursue a loan application for an asset management plan. Mr. Scerbo needs to obtain specific software in order to apply for the loan online, but before he can do that the VTMUA needs to approve designating him an authorized user for the state online website.

Edward Seger moved to designate John Scerbo the authorized user for the state online trust fund; Ceren Aralp as an authorized representative; and Charles Ferraioli, Robert Beinfeld, and Elke Yetter as authorized collaborators.

Gloria Gallo seconded the motion.

Discussion: Ceren Aralp said the loan program has not yet been finalized but it will be forthcoming. Right now, the trust does have a program that provides loans for asset management plans and the VTMUA will try to get funding from the $100,000 principal forgiveness portion. The VTMUA will begin the loan application process.

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

9. Commissioner Comments

Commissioner Edward Seger questioned whether a plaque had been ordered for Vincent Zinno for his service to the VTMUA. John Scerbo said he ordered it but it is not in yet.

Edward Seger also questioned whether there is a timeline for Mountain Creek to repair Pump Station #2. He said they need to press Mountain Creek to go forward with it. Mr. Scerbo said because the VTMUA does not own assets, the township would have to bond for the repairs. Ceren Aralp said the project could take a year or two to complete. Mr. Seger pressed for a deadline for the project. Mr. Scerbo said if he does not hear from Mountain Creek by the end of this week he is going to contact Mountain Creek and tell them they are not willing to wait any longer.

Thomas Buchney said a major deterrent for Mountain Creek moving forward with the project is the town’s refusal to assist in securing financing. John Scerbo said based on the meeting they had the other day, if the council sets up the committee to work with the VTMUA it should not take long to get an agreement on how they want to proceed with Mountain Creek. He said the town needs to get the check from Mountain Creek to rebuild the pump station or go to the trust fund, get the funds, rebuild the pump station, and then assess Mountain Creek for the amount. He said the assessment through the trust fund would be a much lower rate for Mountain Creek, and he cannot see Mountain Creek being unwilling to move forward with the repair.

Thomas Buchney said the mayor’s stipulation before moving forward with anything was that the VTMUA have an asset management plan. That has been the mayor’s position up until this point, he said.

10. Chairman’s Comments

Thomas Buchney thanked the commissioners for their support of him as chairperson of the VTMUA. He also welcomed new members John Perry and Paul Kearney because he had not been at the February meeting, and he thanked them for volunteering to be appointed to the authority.

Thomas Buchney also said he would contact Kristen Wheaton to see of she would serve on the bills committee, as she had expressed an interest. He also said volunteers are necessary to publish four newsletters each year. The next newsletter is due in June. Paul Kearney volunteered to work on the newsletters.

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 attorney/client privilege regarding rules and regulations of the VTMUA.

Edward Seger moved to go into executive session at 8:19 p.m.
Edward Snook seconded the motion.
All were in favor.

12. Return to Public Session

Gloria Gallo moved to return to public session at 8:50 p.m.
Edward Seger seconded the motion.
All were in favor.
The VTMUA went back into public session at 8:50 p.m.

No action was taken.

Adjournment

Edward Snook moved to adjourn the meeting at 8:50 p.m.
Gloria Gallo seconded the motion.
All were in favor.
The meeting was adjourned at 8:50 p.m.

The next meeting of the VTMUA will be on April 20, 2017 at 7 p.m.

Transcribed and submitted by Jessica Paladini
Vernon Township MUA Secretary