PUBLIC UTILITY DISTRICT NO. 1 OF SKAGIT COUNTY COMMISSIONERS MEETING. DRAFT AGENDA December 12, :00 PM

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1 PLEDGE OF ALLEGIANCE PUBLIC UTILITY DISTRICT NO. 1 OF SKAGIT COUNTY COMMISSIONERS MEETING DRAFT AGENDA December 12, :00 PM CONSENT AGENDA 1. Approval of Agenda 12/12/17 2. Approval of Minutes 11/28/17 Commission Meeting 3. Ratification of Vouchers 12/05/17 4. Approval of Vouchers 12/12/17 5. Project Acceptance Twin Brooks, Phase 6 (Mount Vernon) Chuckanut Drive, Joe Leary Slough Crossing (Mount Vernon) 6. Project Award Skagit River Diversion (SRD) Pump and Motor Refurbishment STATUS OF BUDGET 3 rd Quarter 2017 AUDIENCE COMMENTS OLD BUSINESS 7. Manager s Report NEW BUSINESS 8. Project Award - Operations Manual for WTP- Carollo Engineering - Action 9. Annual Recognition of Uncollectible Accounts - Action 10. Scope of Work for District s 5-Year Strategic Plan Request for Proposals (RFP) - Discussion 11. Washington State Sick Leave Law Policy - Action 12. Personal Leave Policy - Action 13. General Manager s 2018 Goals - Discussion MISCELLANEOUS COMMISSIONER COMMENTS EXECUTIVE SESSION Approximate Minute Duration Per RCW (1) (i) (ii) Project Acceptance for Plat of Saratoga Passage ADJOURNMENT JUDY RESERVOIR ELEVATION

2 Agenda Item #2 MINUTES OF THE REGULAR MEETING OF THE COMMISSION PUBLIC UTILITY DISTRICT NO. 1 OF SKAGIT COUNTY, WASHINGTON November 28, 2017 The regular meeting of the Commission of Public Utility District No. 1 was held in the Aqua Room of the utility located at 1415 Freeway Drive, Mount Vernon, Washington, on November 28, The meeting was called to order at 4:30 PM. Those Commissioners in attendance were: Robbie Robertson, President; Eron Berg, Vice President; and Al Littlefield Secretary. Also in attendance were: George Sidhu, General Manager; Mark Handzlik, Engineering Manager; Sally Saxton, Treasurer; Peter Gilbert, Attorney; and Kim Carpenter, Clerk of the Board; Audience: Judy Littlefield, Jan & John Olson, Linda Anderson, Randall Anderson, Don & Erin Moe; and District Employees: Kathy White, Mike Fox, Kevin Tate, Luis Gonzalez, Mark Semrau, Mike Demers, Bill Trueman, Kurt VanBurkleo. Commissioner Littlefield led the Pledge of Allegiance. Commissioner Littlefield moved to approve the Consent Agenda for November 28, 2017: 1. Approval of Agenda 11/28/17 2. Approval of Minutes 11/14/17 Commission Meeting 3. Ratification of Vouchers 11/21/17 No Voucher Nos ($284,043.62) 4. Approval of Vouchers 11/28/17 No Voucher Nos , Payroll Check Nos ($1,278,877.43) 5. Project Acceptance Sharon Avenue, Plat of Maiben Glen (Burlington) Hazel Avenue, Burlington Boulevard to Walnut Street (Burlington) Hansen s Furniture & Craft Stove (Mount Vernon) WTP Chemical Feed Systems Replacement College Station, College Way P (Mount Vernon) TREASURER S REPORT Treasurer Saxton presented the Treasurer s Report for the month of October 2017 Under Audience Comments, John Olsen, Dike Road, Mount Vernon, commented on and encouraged the Commission to expedite acceptance of the Saratoga Passage Project when the time comes. Mark Parris, 4820 Beaver Pond Drive, Mount Vernon, thanked and commended staff and the Commission for their assistance with this project and commented on the amount of crime in the area, ongoing litigation between the owner and the banks and acceptable risk the District should consider to solve the ownership issue. Discussion ensued regarding various aspects of the project and comments. Commissioner Robertson stated that the Commission will be discussing development regarding the project in executive session this evening and as soon as the project has been accepted the District will issue Commission Meeting 1 November 28, 2017

3 Agenda Item #2 letters of water availability. Attorney Gilbert stated that there will most likely be no action taken following the executive session. Under Old Business: 6. Manager s Report - Manager Sidhu reviewed the upcoming meeting schedule: Joint Work Session-Port of Skagit County-Community Fiber 3:00 PM Joint Work Session-Skagit County-Water Rights Issues and Water 2:30 PM Regular Commission 5:00 PM (currently scheduled as last meeting of the year) 7. Quarterly Report Operations Operations Manager Fox presented a quarterly update regarding the Operations Department, including status of the following: Took delivery of new dump truck Leak Detection Survey of entire Alger System only one leak; consumption is the issue with three customers using the majority of water; Alger generator installation. WTP addition of anthracite coal Water Quality Conference attended by Water Quality Coordinator Blake; looking into a floating buoy to electronically monitor and control algae in Judy Reservoir. SRD pumps have been repaired and CLA-valves are being rebuilt. At this time, Commissioner Robertson requested changing the order of the New Business items to 9, 11, 8 & 10. Under New Business, 9. Gilligan Creek Watershed Property Protection Project Authorizing Budget Amendment and Finalization of Property Purchase Action Commissioner Robertson gave a brief overview of the project and the requested action. Discussion ensued regarding various aspects of the request. Commissioner Littlefield moved to increase the Gilligan Creek Property Acquisition budget from $1,590,000 to $1,650,000 from the System Development Fund as recommended. The motion passed. Commissioner Berg moved to authorize the General Manager to waive the contingencies on behalf of the District as set forth in the Real Estate Purchase and Sale Agreement of September 22, 2017 with Weyerhaeuser Company as recommended. The motion passed. Commissioner Robertson moved to authorize the General Manager and District staff to take all necessary actions to complete the closing of the transaction and to make payments associated therewith, pursuant to the terms and conditions of said Real Estate Purchase and Sale Agreement as recommended. The motion passed. 11. The Interlocal Purchasing System (TIPS) Agreement Action Manager Sidhu presented The Interlocal Purchasing System (TIPS) Agreement and recommended approval. He stated that language is still being worked on for the Enterprise Agreement. Commissioner Berg moved to authorize the General Commission Meeting 2 November 28, 2017

4 Agenda Item #2 Manager to execute said Agreement for the purchase of District fleet vehicles. The motion passed. 8. Resolution No Adopt 2018 Budget-Action Manager Sidhu presented Resolution No , A RESOLUTION OF THE COMMISSION OF PUBLIC UTILITY DISTRICT NO. 1 OF SKAGIT COUNTY, WASHINGTON, ADOPTING THE FINAL BUDGET FOR PUBLIC UTILITY DISTRICT NO. 1 OF SKAGIT COUNTY, WASHINGTON FOR THE CALENDAR YEAR 2018 and recommended adoption. Commissioner Littlefield moved to adopt Resolution No as presented. Discussion ensued regarding approval of the budget prior to the compensation program, responsibility for budget administration and implementation, and use of a line item budget. Commissioner Berg moved to amend Commissioner Littlefield s motion to delete Paragraph 2 on Page 8 of the proposed 2018 budget. The motion passed. Commissioner Littlefield s motion to adopt the 2018 Budget was restated. Commissioner Robertson commended staff for their work and stated he appreciated the data and work sessions. The motion passed. 10. Compensation Study - Discussion Resolution No Establishing Positions and Salary Ranges for Non-Union Staff and Supervisory Employees - Potential Action Manager Sidhu reviewed the compensation study process leading up to presentation of Resolution No Commissioner Littlefield moved to adopt Resolution No , A RESOLUTION OF THE COMMISSION OF PUBLIC UTILITY DISTRICT NO. 1 OF SKAGIT COUNTY, WASHINGTON, ESTABLISHING POSITIONS AND SALARY RANGES FOR NON-UNION STAFF AND SUPERVISING EMPLOYEES as presented. Discussion ensued regarding various aspects of the compensation study, including the performance evaluation form, implementation of the program and training with supervisory personnel, merit increase potential, 3.5% Cost of Living Adjustment (COLA), costs associated with increasing salaries of four employees currently below the minimum range, issues regarding the survey, comparables and assumptions, Snohomish PUD salary resolution, making policy vs. implementation of policy, ability to address policy revisions, and the average COLA over last ten years. Commissioner Berg expressed concerns regarding various issues of the proposed policy, believes more work needs to be done in 2018 prior to adoption the policy and will vote no for the policy as written. Commissioner Robertson stated he feels the policy is the right thing for the District moving forward. Commissioner Littlefield stated that he believes potential merit increases give employees an incentive to improve. Commissioner Robertson stated that there is a motion on the floor to adopt Resolution No The motion passed. Commissioner Berg requested that the record reflect that he was opposed. Under Commissioner Comments, Commissioner Littlefield reported he would be attending the WA PUD Association (WPUDA) Annual meeting in Spokane. Commissioners Robertson reported that he would not be attending the annual meeting this year, but will conference in as the Water Committee Chair. Commission Meeting 3 November 28, 2017

5 Agenda Item #2 At this time, President Robertson recessed the regular meeting to go into executive session per RCW (1) (i) (ii) to discuss Project Acceptance for the Plat of Saratoga Passage for an approximate duration of minutes. The meeting was recessed at 5:43 PM. The executive session convened at 5:47 PM. President Robertson reconvened the regular meeting of the Commission at 6:14 PM. Having no further business to come before the Board, Commissioner Littlefield moved for adjournment. The motion passed and the meeting of November 28, 2017 was adjourned at 6:15 PM. Respectfully submitted: Kim Carpenter Clerk of the Board Commission Meeting 4 November 28, 2017

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13 PUD NO 1 OF SKAGIT COUNTY STATEMENT OF NET POSITION (Unaudited) AS OF SEPTEMBER 30, ASSETS CURRENT ASSETS CASH AND INVESTMENTS $ 8,589,554 $ 9,095,840 ACCOUNTS RECEIVABLE (NET) 1,202,587 1,688,902 ACCRUED UNBILLED REVENUES 1,278,280 1,572,498 INVENTORY 1,523,792 1,615,739 PREPAID INSURANCE 339, ,189 OTHER CURRENT AND ACCRUED ASSETS 204, ,940 TOTAL CURRENT ASSETS 13,137,821 14,527,108 RESTRICTED ASSETS CASH AND INVESTMENTS 6,607,968 4,916,049 GRANTS AND FED STIMULUS RECEIVABLE 16,529 15,800 TOTAL RESTRICTED ASSETS 6,624,497 4,931,849 NONCURRENT ASSETS PRELIM SURVEY AND INVESTIGATION 639,005 1,186,721 LUD ASSESSMENTS RECEIVABLE 774, ,355 CAPITAL ASSETS NON OPERATING PROPERTY 29,521 29,521 LAND AND LAND RIGHTS 579, ,821 PLANT 201,211, ,852,722 EQUIPMENT 9,743,322 9,859,376 CONSTRUCTION IN PROGRESS 13,941,378 16,877,684 COMPLETED CONST NOT CLASSIFIED 1,053,248 0 ACCUMULATED DEPRECIATION (69,819,472) (74,322,429) TOTAL NONCURRENT ASSETS 158,152, ,831,772 TOTAL ASSETS $ 177,915,162 $ 190,290,729 DEFERRED OUTFLOWS OF RESOURCES DEFERRED OUTFLOWS RELATED TO PENSIONS 562,579 1,136,027 TOTAL DEFERRED OUTFLOWS OF RESOURCES $ 562,579 $ 1,136,027 PUD No 1 of Skagit County (Skagit PUD) has prepared these financial statements in accordance with generally accepted accounting principles. These financial statements should be read in conjunction with the notes to the financial statements included in Skagit PUD's Annual Report as of December 31, This information is provided for general information. Not all the information is intended for nor should it be relied upon for making investment decision by current or prospective investors. PAGE 1

14 PUD NO 1 OF SKAGIT COUNTY STATEMENT OF NET POSITION (Unaudited) AS OF SEPTEMBER 30, LIABILITIES CURRENT LIABILITIES: ACCOUNTS PAYABLE $ 685,275 $ 635,143 CUSTOMER DEPOSITS 162, ,847 ACCRUED TAXES PAYABLE 123, ,755 ACCRUED INTEREST ON DEBT 140, ,258 BONDS AND LOANS PAYABLE 2,668,285 3,589,789 COMPENSATED ABSENCES 812, ,590 CUSTOMER ADVANCES FOR CONSTRUCTION 65, ,066 RETAINAGE PAYABLE 12, ,860 OTHER DEFERRED CREDITS 250 1,000 TOTAL CURRENT LIABILITIES 4,671,793 5,987,307 NONCURRENT LIABILITIES OTHER POSTEMPLOYMENT BENEFITS 1,018,703 1,285,524 UNAMORTIZED DEBT PREMIUMS 34,168 14,643 UNAMORTIZED DEBT EXPENSE (155,395) (3,693) REVENUE BONDS OUTSTANDING 10,167,917 9,004,329 PUBLIC WORKS TRUST FUND LOANS 8,977,123 6,168,922 DRINKING WATER STATE REV FUND LOANS 1,445,816 8,221,375 TOTAL NONCURRENT LIABILITIES 21,488,331 24,691,099 NET PENSION LIABILITY 4,783,347 6,078,187 TOTAL LIABILITIES $ 30,943,471 $ 36,756,593 DEFERRED INFLOWS OF RESOURCES DEFERRED INFLOWS RELATED TO PENSIONS 713, ,213 TOTAL DEFERRED INFLOWS OF RESOURCES $ 713,799 $ 105,213 NET POSITION INVESTED IN CAPITAL ASSETS NET OF DEBT $ 133,466,891 $ 141,772,421 RESTRICTED ASSETS 6,624,497 4,931,849 UNRESTRICTED ASSETS 6,729,082 7,860,680 TOTAL NET POSITION $ 146,820,470 $ 154,564,950 PUD No 1 of Skagit County (Skagit PUD) has prepared these financial statements in accordance with generally accepted accounting principles. These financial statements should be read in conjunction with the notes to the financial statements included in Skagit PUD's Annual Report as of December 31, This information is provided for general information. Not all the information is intended for nor should it be relied upon for making investment decision by current or prospective investors. PAGE 2

15 PUD NO 1 OF SKAGIT COUNTY REVENUES, EXPENSES AND CHANGES IN NET POSITION (Unaudited) FOR NINE MONTHS ENDING SEPTEMBER 30, Actual to Budget 3rd Qtr Actual 3rd Qtr Actual 3rd Qtr Budget favorable (unfavorble) OPERATING REVENUE RESIDENTIAL-MULTIPLE $ 9,931,419 $ 11,150,530 $ 10,869,067 $ 281, % COMMERCIAL-INDUSTRIAL-FARMS-FIRE PROTECTION 3,312,649 3,751,506 3,508, , % GOVERNMENTAL 399, , ,582 10, % RESALE 61,699 91,851 77,950 13, % IRRIGATION 310, , , , % TOTAL WATER SALES 14,015,592 15,972,338 15,250, , % OTHER WATER REVENUES 294, , ,888 34, % BROADBAND REVENUES, NET OF COSTS 9,359 10,439 9, % TOTAL OPERATING REVENUES 14,319,250 16,203,417 15,446, , % OPERATING EXPENSES SUPPLY 473, , , ,073 74% TREATMENT 1,211,235 1,401,145 1,607, ,030 87% TRANSMISSION AND DISTRIBUTION 1,730,597 1,474,590 1,513,451 38,861 97% PURCHASED TELECOMMUNICATIONS SVCS 24,367 25,901 23,250 (2,651) 111% CUSTOMER ACCOUNTS 928,983 1,129,696 1,223,610 93,914 92% ADMINISTRATIVE AND GENERAL 2,751,675 3,271,453 3,966, ,231 82% UTILITY TAXES 724, , ,472 1, % DEPRECIATION EXPENSE 3,591,793 3,788,485 3,785,178 (3,307) 100% TOTAL OPERATING EXPENSES 11,436,377 12,333,345 13,526,545 1,193,200 91% OPERATING INCOME (LOSS) 2,882,872 3,870,072 1,919,967 1,950, % NON OPERATING REVENUE INTEREST INCOME 63,999 92,184 47,250 44, % INTEREST AND PENALTY INCOME ON LUDS 18,331 16,726 25,506 (8,780) 66% MISCELLANEOUS INCOME 24,894 45,230 26,253 18, % TOTAL NON OPERATING REVENUE 107, ,140 99,009 55, % NON OPERATING EXPENSE MISCELLANEOUS EXPENSE 1, , % INTEREST ON DEBT, NET 294, , ,681 87,067 80% OTHER TAXES 13,842 54,233 17,153 (37,080) 316% TOTAL NON OPERATING EXPENSE 309, , ,481 50,855 89% INCOME (LOSS) BEFORE CONTRIBUTIONS 2,680,127 3,614,586 1,558,495 2,056, % CAPITAL CONTRIBUTIONS NON DONATED PLANT 185, , , , % DONATED PLANT 596, , , , % SYSTEM DEVELOPMENT FEES 1,078,158 1,156, , , % PIPE REPLACEMENT 433, , ,420 8, % SERVICES 288, , , , % LOCAL UTILITY DISTRICTS ,000 (175,000) 0% GRANTS 47, ,510 (35,510) 0% TOTAL CAPITAL CONTRIBUTIONS 2,629,154 2,877,303 2,280, , % CHANGE IN NET POSITION 5,309,281 6,491,889 $ 3,839,425 $ 2,652, % NET POSITION, JANUARY 1 141,511, ,073,061 NET POSITION, SEPTEMBER 30 $ 146,820,470 $ 154,564,950 PUD No 1 of Skagit County (Skagit PUD) has prepared these financial statements in accordance with generally accepted accounting principles. These financial statements should be read in conjunction with the notes to the financial statements included in Skagit PUD's Annual Report as of December 31, This information is provided for general information. Not all the information is intended for nor should it be relied upon for making investment decision by current or prospective investors. PAGE 3

16 PUD NO 1 OF SKAGIT COUNTY OPERATING REVENUES AND EXPENSE TRACKING (Unaudited) FOR NINE MONTHS ENDING SEPTEMBER 30, Actual to Budget YTD Actual YTD Actual YTD Budget favorable (unfavorble) OPERATING REVENUE WATER SALES JUDY SYSTEM $ 13,512,383 $ 15,421,407 $ 14,708,880 $ 712, % FIDALGO/SIMILK 283, , ,366 (23,305) 93% CEDARGROVE 65,649 73,487 64,560 8, % ROCKPORT 22,814 25,436 23,979 1, % MOUNTAIN VIEW 7,492 8,972 8, % ALGER/SAMISH 55,270 66,699 52,411 14, % POTLATCH 29,125 32,089 33,783 (1,694) 95% SKAGIT VIEW VILLAGE 28,014 31,725 27,777 3, % MARBLEMOUNT 11,844 13,461 8,890 4, % TOTAL WATER SALES 14,015,592 15,972,338 15,250, , % OTHER OPERATING REVENUE MISC SERVICE CHARGES AND CONTRACTS 293, , ,672 34, % WATER TESTING SALES % BROADBAND SERVICES, NET OF COSTS 9,359 10,439 9, % TOTAL OTHER OPERATING REVENUE 303, , ,638 35, % TOTAL OPERATING REVENUE 14,319,250 16,203,417 15,446, , % OPERATING EXPENSES SALARIES/WAGES/BENEFITS 5,717,656 5,800,663 6,350, ,109 91% GENERAL SUPPLIES AND SERVICES 1,020,781 1,147,919 1,364, ,981 84% WATER PURCHASED FROM OTHERS 168, , ,753 (22,027) 116% ELECTRICITY PURCHASED FOR PUMPING 289, , ,381 98,321 75% CHEMICALS FOR TREATMENT 214, , ,533 (32,187) 111% UTILITIES 83, , ,367 (5,736) 105% POSTAGE AND SHIPPING 70,890 69,555 66,798 (2,757) 104% EQUIP MAINT CONTRACTS 13,000 13,730 20,097 6,367 68% PURCHASED TELECOMMUNICATIONS SVCS 24,367 20,705 23,250 2,545 89% MEMBERSHIPS 44,253 58,173 56,214 (1,959) 103% ACQUIRED PROFESSIONAL SERVICES 172, , , ,633 56% EQUIPMENT AND VEHICLE EXPENSE 107, , ,253 19,389 85% INSURANCE EXPENSE 283, , ,532 (44,889) 118% ADVERTISING EXPENSE 10,448 24,627 24, % BAD DEBT EXPENSE 16,712 24,705 22,500 (2,205) 110% MISCELLANEOUS EXPENSES 3, % UTILITY TAXES 724, , ,472 1, % TRANSFERS TO CONSTRUCTION IN PROGRESS (1,120,250) (998,857) (810,000) 188, % TOTAL OPERATING EXPENSES 7,844,585 8,544,860 9,741,367 1,196,507 88% NET OPERATING INCOME BEFORE DEPRECIATION AND OPEB COSTS $ 6,474,665 $ 7,658,557 $ 5,705,145 $ 1,953, % PUD No 1 of Skagit County (Skagit PUD) has prepared these financial statements in accordance with generally accepted accounting principles. These financial statements should be read in conjunction with the notes to the financial statements included in Skagit PUD's Annual Report as of December 31, This information is provided for general information. Not all the information is intended for nor should it be relied upon for making investment decision by current or prospective investors. PAGE 4

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36 Agenda Item #10 Request for Proposals (RFP) Development of 5-year Strategic Plan DATE, 2017

37 Agenda Item # Background 1.1 Executive Summary The Public Utility District No. 1 of Skagit County, Washington ( District ) issues this request for proposals ( RFP ) from qualified firms ( Consultant ) to develop a Strategic Plan that incorporates five-year goals and measurable objectives. The District does not currently have a Strategic Plan in place but understands that the development of a plan will provide us with a tool for making decisions regarding the allocation of labor, materials and equipment to help prioritize budget spending and setting water rates. The District is interested in focusing on our core business functions in order to protect our ability to continue delivering reliable, cost-efficient water service and to provide opportunities for organizational growth and development. A Strategic Plan encompasses both a baseline assessment of an organization and a road map to develop and achieve a planned response to factors which affect an organization s mission. It defines the purpose of an organization (mission and vision), what it will do and how it will perform (goals and measurable objectives) and under what terms it will operate (values). A Strategic Plan allows an organization to establish direction and priorities, to focus on the critical actions necessary to implement and achieve the mission, improves resource utilization, reduces redundancy, and allows an organization to both establish stability and seek opportunity. A Strategic Plan receives final review and approval by organization management and policymakers (Board of Commissioners) and is developed through a process to assure that objectives can be implemented and achieved with direct action. The District is interested in having the Consultant develop the Strategic Plan such that it can be updated by the District every 3-4 years, or as required based on the business and operational needs. 1.2 Overview of Public Utility District No. 1 of Skagit County The District is a municipal corporation of the State of Washington, established in 1936 for the purpose of providing safe, efficient, reliable and affordable water service to the residents of Skagit County. The District is also authorized under state law to provide sewer services and wholesale telecommunication services. At the current time, there are no active sewer customers, but there are two wholesale fiber-optic customers. The District currently employs approximately 77 FTEs, which include 67 employees working out of the main campus building on Freeway Drive, and another 10 employees at the water treatment plant. The District operates the largest water system in Skagit County, providing an average of nine million gallons of piped water to approximately 65,000 people every day. The District maintains over 600 miles of pipelines and has over 31 million gallons of water storage volume. The cities of Mount Vernon, Burlington, and Sedro-Woolley receive the majority of our water. Due to public demand for quality water, the District also provides service to unincorporated and remote areas of the county. The District s water service area encompasses all of Skagit County, and specifically includes part of Fidalgo Island at the west end of the county and extends as far east as Marblemount. From south to north, the District s service area starts in Conway and extends north to Alger/Lake Samish. PUD No. 1 of Skagit County RFP for Development of 5-year Strategic Plan Page 1 of 7

38 Agenda Item # Scope of Work The District is seeking a consultant to provide services to assist the District in the development of a 5- year Strategic Plan to guide the District s goals and objectives. The specific scope of services for the work under this contract will include the following: Task One Interviews with Commissioners, General Manager and Management Staff Meet with the General Manager to review the contract and scope of services, identify information needed, and discuss/refine goals and format for the sessions. Conduct in-person and/or telephone interviews with Commissioners, General Manager and identified management staff to gather information about desired projects, program, work elements, and policies to be considered in developing the Strategic Plan. Review and assess the strength and applicability of the District s existing Mission Statement, Vision Statement, and Core Values. The deliverables for Task One shall be a schedule and timeline for activity completion, survey documents and questionnaires completed by the participants, and a memo discussing the applicability of the District s existing Mission, Vision, and Values. Task Two Development of District Goals and Primary Objectives As a result of the interviews and survey questionnaires, the Consultant will identify a list of goals and objectives for consideration by the Board and management staff during a work session on this topic. The work session is intended to prioritize proposed activities, tasks, resources, policies and timeframes. Consultant will attend an additional work session with management staff to further refine activities based on prioritization of goals and objectives. Recommended measurable activities with scheduled timeframes will be included in the production of the draft Strategic Plan and are subject to final approval by the Board. The deliverable for this Task Two will be a draft and final memo identifying goals, objectives, activities/tasks, resources needed, and schedules and timelines for activity completion. Task Three Development of a Five-year Strategic Plan Prepare an administrative draft of the Strategic Plan for review by management staff and refine the document as needed prior to the presentation of a Draft Plan for consideration by the Board. Produce a Final Draft Strategic Plan for review and approval or modification by the District Board within three months of the start of the project, dependent upon the availability of Board and staff. Consultant will present and discuss the plan at a public hearing of the Board, with the intent of adopting the Final 5-year Strategic Plan. The deliverables for Task Three will include an administrative draft and final draft of the Strategic Plan, and six (6) hard copies and an electronic copy of the Final Strategic Plan. PUD No. 1 of Skagit County RFP for Development of 5-year Strategic Plan Page 5 of 7

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41 Agenda Item #11 Washington State Paid Sick Leave Policy #1027 In accordance with the authority granted by Board Resolution # , a Paid Sick Leave Policy, as described below and newly required by Initiative 1433 to be effective January 1, 2018, is hereby established for employees of Public Utility District No. 1 of Skagit County (hereinafter referred to as the District ). In order to differentiate new paid sick leave from the Supplemental Leave Benefit established in 1997, the new Washington State Paid Sick Leave will be referred to as WSSL. 1. The District follows Paid Sick Leave Law RCW Beginning January 1, 2018, Policy #1027 will apply to all employees. Although the law does not require it be applied to FLSA-exempt employees, for ease of administration, the District has chosen to apply it to all employees of the District. 2. Employees May Use WSSL for Eligible Reasons. Employees may use accrued WSSL to cover absences due to: Employee s illness (mental or physical), injury, or health condition, and for preventive care. Employee s care for a family member s illness (mental or physical), injury, or health condition, and for preventive care. Please Note: For the purpose of this policy, the term family member includes a child, parent, spouse, registered domestic partner, grandparent, grandchild, and sibling as further outlined in RCW (2). Public health closures of District facilities or a dependent s school or care facility. Absences due to domestic violence, sexual assault, or stalking. Other eligible reasons as outlined in Policy #1003 Personal Leave. 3. The District May Verify Reasons if Absence Exceeds 3 Days. For WSSL usage over three consecutive days, the District may ask the employee for verification from a health care provider that the absence is for an eligible reason. 4. Employees Provide Reasonable Notice of Absence. For unexpected absences, the employee will notify his/her supervisor of the inability to work prior to the beginning of the work day. If an absence is foreseeable, the employee will provide enough notice as is feasible. 5. The District Prohibits Retaliation. The District will not discipline or retaliate against an employee for the lawful use of WSSL. 6. Returning Separated Employees May Receive Reinstated Hours. If rehired within 12 months in the same calendar year, the separated employee will have 100% of unused WSSL accruals reinstated. If rehired in the following year, the District will reinstate no more than 40 hours of a rehired employee s previously accrued unused sick leave. These reinstatements only Policy # of 2

42 Agenda Item #11 apply to hours which have not been previously cashed out to departing employees per District policy. 7. Administration of WSSL Policy. The following will apply to the administration of Policy #1027 and WSSL: Effective January 1, 2018, each employee will have a new WSSL bank in addition to their already established personal leave bank. Per pay period, two (2) hours of WSSL will be added to each employee s WSSL bank. Once the 2 hours of WSSL time have been added to the WSSL bank, any amount of regular personal leave they would normally accrue (depending on the years of service as outlined in Policy #1003 Personal Leave), minus the WSSL, will be added to their personal leave bank. Please see examples below: Example: Employee A has been with the District for three years and is accruing 168 hours of PL annually, which means per pay period (168 hours annually divided by 26 payrolls per year = per pay period). Two hours of WSSL will be put into the WSSL bank. Instead of getting the normal hours of PL, it would be reduced by the 2 hours put into the WSSL bank, so the employee would have hours of PL put into the PL bank. In total, 2 hours into the WSSL bank and into the PL bank, for a combined total of hours. The District will review wage and hour reports at least on a quarterly basis to ensure that employees have accrued enough WSSL, and will make any necessary adjustments. WSSL and Personal Leave time will be coordinated. At no time will an employee accrue more total time than is outlined in Policy #1003 Personal Leave, based on years of continuous employment. Any WSSL hours over 40 left in the WSSL bank at the end of each calendar year will be removed from the WSSL bank and added to the personal leave bank, with the intent that employees will not lose any accrued time. Please see the example below: Example: Employee C has a total of 48 WSSL hours in the WSSL bank at the end of the calendar year. Eight hours will be removed from the WSSL bank and added to the PL bank. The remaining 40 hours will remain in the WSSL bank and will be carried over to the following year. Employees will be able to cash out their accrued WSSL under the same provisions as personal leave, as outlined in Policy #1003 Personal Leave. WSSL and personal leave will be considered combined hours for these purposes, and total cash outs will not exceed the limits outlined in that policy. Any employees not eligible to accrue PL but eligible for WSSL will accrue WSSL hours on an hours worked basis. Former Title/Policy #: Board Approval Date: Effective Date: Revision Date: N/A General Manager Signature: Date: Policy # of 2

43 Agenda Item #12 Personal Leave Policy #1003 In accordance with the authority granted by Board Resolution # , a Personal Leave Policy, as described below, is hereby established for employees of Public Utility District No.1 of Skagit County. Purpose: In recognition of the need for time off for the purposes of rest and relaxation, illness, injury, child care, bereavement, personal business and any other approved absence from work on a paid leave status except to the extent that Washington State Paid Sick Leave, Worker s Compensation, the Occupational Disability Benefit or the Short-Term Disability Benefit provisions provide otherwise, the following Personal Leave Plan is established for regular employees of the District. Union employees will be compensated and scheduled for Personal Leave in accordance with the most current collective bargaining agreement. Accrual: Except while receiving Worker s Compensation time-loss, an Occupational Disability Benefit, or in a leave without pay status, each eligible employee shall accrue personal leave as follows: Completed Years of Continuous Employment Zero (0) through four (4) Five (5) through eleven (11) Twelve (12) through (19) Twenty (20) and over Personal Leave Accrual Rate per Year 168 hours (or 21 eight-hr days) 208 hours (or 26 eight hr days) 248 hours (or 31 eight-hr days) 288 hours (or 36 eight-hr days) In order to comply with Washington state law which implemented paid sick leave January 1, 2018, the District will separate personal leave into two banks of time as outlined in Policy #1027 Washington State Paid Sick Leave. This will not change total employee accrual amounts. For additional information on Washington State Paid Sick Leave and how it will be administrated by the District, please refer to Policy #1027. Leave Usage (applies to Personal Leave only; WA State Sick Leave provisions are outlined in Policy #1027): Personal leave usage is subject to the following conditions: 1. Personal Leave will not be taken before it is accrued. 2. Scheduling of personal leave is conditioned upon the operational needs of the District and supervisory approval. Insofar as possible, leave will be scheduled in accordance with the wishes of the employee. 3. Leave requests must be submitted in writing on the Personal Leave Request Form and approved by the supervisor. The supervisor or the supervisor s designee will respond to the request within two (2) working days. It is the intention that leave be granted upon shorter notice for emergencies, death, illness or serious accident. Policy # of 1

44 4. Use of planned Personal Leave will be scheduled such that advance approval is sought at least twice as early as the length of the requested leave; (e.g. one weeks leave would require at least two weeks notice). 5. An employee must promptly notify his/her supervisor on the first day of unplanned personal leave use and each day after, unless there is an agreement to do otherwise. If an employee is in a position where a relief replacement is necessary during an absence, he/she will notify their supervisor at least one (1) hour in advance of their regular work shift, or as directed by their supervisor. 6. Unplanned use of Personal Leave so frequent as to interfere with job performance or District operations shall subject the employee to corrective action, regardless of the cause for such unplanned use. 7. Personal Leave accrued for each employee shall not exceed eight hundred (800) hours. 8. Personal Leave cannot be used while on an unpaid disciplinary suspension. Treatment of Accrued Leave upon Separation from Service: Except for reason of retirement, all accrued, unused personal leave shall be cashed out upon termination provided that six (6) months of continuous service have been completed. Treatment of Accrued Leave upon Retirement: At the time of retirement under PERS Plan 1, the District will cash out a maximum of two hundred forty (240) hours of accrued unused personal leave. An employee retiring from the District will be required to give at least one hundred twenty (120) calendar days advanced written notice of their retirement date. The purpose of this notification is to allow adequate time for the employee to take accrued personal leave in excess of two hundred forty (240) hours. At the time of retirement, any unused personal leave in excess of two hundred forty (240) hours will be lost. At the time of retirement under PERS Plan 2 or PERS Plan 3, the District will provide employees the option to cash out all accrued unused personal leave, up to the 800 hour maximum. At the time of retirement under PERS Plan 1, Plan 2, or Plan 3, the employee will have the option of cashing out their unused personal leave in a lump sum amount or in increments (e.g. they can opt to continue to get regular checks until their personal leave is exhausted). Exempt Employees: Employees who are designated as exempt (as defined in the Fair Labor Standards Act) are paid a salary, not by hours of work. In order to avoid gifting of public funds, Personal Leave of exempt employees will be charged for partial-day absences of more than four hours. In such cases, the Personal Leave deduction will be hour-for-hour. Exempt employees are responsible at all times to maintain satisfactory work performance and acceptable attendance standards.attendance Standards: All employees are responsible for maintaining acceptable attendance standards at all times in order to ensure effective District operations. Former Title/Policy #: Personal Leave Plan, Personal Leave #1003 Board Approval Date: May 5, 2009 February 9, 2016 Effective Date: May 5, 2009, February 9, 2016 Revision Date: December 12, 2017 February 9, 2016 General Manager Signature: Date: Agenda Item #12 Policy # of 2

45 Agenda Item #13

46 Agenda Item # Goals General Manager George Sidhu 1. Community Relations Continue to develop and maintain good working relationships and collaboration with external agencies and organizations. This will include local and state partners, as well as our regulators. Steps involved in achieving this goal will include: a. Making arrangements for additional tours of the water treatment plant for local elected officials and staff. The tour will take place in August, with future tours taking place every two years. b. Development of a presentation about Skagit PUD that can be made at local agency meetings to discuss the District s operations in general, and specifically review our Capital Program and financing. (May July) c. Continue to improve the experience for our customers with respect to sharing of information on our web site. This will include the addition of previous resolutions that have been passed. d. Increase District attendance at local fairs and events. 2. Watershed As part of our mission to provide safe and reliable utility services, I will continue to facilitate the protection of our water sources in the Cultus Mountain watershed by bringing forward a proposal for future purchase priorities and funding mechanisms. The proposal will be brought forward as part of the budgeting process for Strategic Planning To prepare for the 2019 Budget, work will be done to address the District s short term and long term planning horizons. Steps involved in achieving this goal will include: a. Development of a Strategic Plan that addresses the District s mission, vision and values, while clarifying the short term needs and budget direction. A 5 year Strategic Plan will work in combination with a Capital Facilities Plan in assisting to identifying areas where the District should focus its resources. b. Development of a Capital Facilities Plan that outlines the capital projects for a 5 year horizon that will make the annual budget process easier. c. Development of an updated financial plan and rate study to outline the financial obligations of the District in order to accomplish the Strategic Plan and the Capital Facilities Plan.

47 Agenda Item #13 4. Visionary and Long Term Goals Effort will be put towards larger, policy related goals that encompass the District s role and responsibilities within Skagit County to better serve our customers. These items will involve multiple stakeholders and are likely to be multi year issues that are not easily quantified. And so, the objective is to make progress towards successful discussions to reach these goals. Issues that are included in achieving this goal will include: Community Fiber Working with local agencies and partners to help in providing better fiber optic service to residents of Skagit County. Water Rights Working with local and state agencies to help in providing viable solutions to the exempt well water rights issue and the agricultural water right issue. District Campus Working to provide potential solutions to the maintenance and repair issues of the existing District campus building.