NORTH COAST RAILROAD AUTHORITY

BOARD OF DIRECTORS

REGULAR MEETING MINUTES

WEDNESDAY, JUNE 16, 1999

SANTA ROSA BOARD OF SUPERVISORS CHAMBERS

SANTA ROSA, CALIFORNIA

  1. Closed Session

    Closed session began at 9:30 a.m.

  2. Call to Order

    The meeting was called to order at 10:20 a.m. by Chairman Allan Hemphill.

  3. Roll Call

    Directors present: Chairman Allan Hemphill, Jack McKellar, Ruth Rockefeller, John Stokes, and Robert Jehn. Also present were Legal Counsel Christopher Neary and Property Manager Cyndee Logan.

    Directors absent: David Nelson and Dennis Wood.

  4. Minutes
    1. Approval of Minutes of the May 19, 1999 Regular Meeting. Motion by Mr. Stokes. Seconded by Mr. McKellar. Vote taken. Motion carried.
    2. Approval of Minutes of the May 21, 1999 Special Meeting. Motion by Mr. Jehn. Seconded by Mr. McKellar. Vote taken. Motion carried.
  1. Agenda Approval

    Agenda stands approved as read per Chairman Allan Hemphill.

  2. Announcement of Action Taken in Closed Session

    From the May 19, 1999 Meeting closed session: 1) NCRA Real Estate negotiators were authorized to negotiate a potential lease of a real property interest. 2) Frank Lovio’s FELA case settlement was recognized as a judgment. From this Meeting’s closed session: 1) Further direction was given to NCRA Real Estate negotiators concerning a potential longitudinal easement. 2) Approval for General Counsel to execute a settlement in Schafer v. NCRA. 3) A determination was made to direct Hughes, Perry & Associates to extend an offer and negotiate the terms of employment with the top candidate for CEO. The decision will be ratified by the Board at a special meeting or the next regular meeting.

  3. Consent Agenda

3. Consideration of Eldred Claim (1999-1)

Mr. Neary reported he investigated this claim, believes it is valid, and recommends the claim be approved and paid from discretionary funds. Mr. Jehn volunteered to investigate quotes on purchasing insurance coverage.

    1. Authorization for Execution of Wells Fargo Bank Signature Card

      Mr. Neary reported the NCRA Accounting Manual requires Board approval for filing bank signature cards. He requested each Board member sign after today’s meeting.

    2. Approval of Real Estate Commission

      Mr. Neary reported he is recommending the Board give Ms. Logan authority to

      to pay herself her commission for the sale of the Willits Depot pursuant to her

      contract.

    3. Approval of Claim Forms

Mr. Neary reported the NCRA Office Manager has prepared a draft expense claim form for Board members to use in submitting their expenses for approval. Mr. Neary recommended approval of this form.

Motion by Ms. Rockefeller to approve the Consent Agenda. Seconded by Mr. Jehn. Vote taken. Motion carried.

  1. Conduct of Business
    1. Approval of Vendor Warrants

      Russ Mustola, Mustola Management, reported he recommends approval of the schedule he prepared for those vendors owed over $3,000 to be paid from the California Transportation Commission allocation of $494,000 amounting to approximately ten percent of each vendor’s balance prior to finance charges and collection fees. Checks for each of these vendors have been printed in anticipated approval and are awaiting signatures. In addition, Mr. Mustola requested the Board resolve to transfer CTC money not to exceed $15,000 from the Administrative Budget to the Vendor portion of the AB2782 monies in order to satisfy the settlements of vendors that are owed more than $1,000. Motion by Ms. Rockefeller. Seconded by Mr. Jehn. Vote taken. Motion carried.

      Mr. Mustola also reported that $160,000 for the Accounting Project slated for use before April 30, 1999 became a surplus as of May 1, 1999. Mr. Mustola recommends combining the surplus with the Administrative Budget. Mr. Neary recommends tabling the item until a written resolution is presented to the Board.

    2. Amendment of Boyle Contract to Supervise Improved Project

      Mr. Neary reported Boyle Engineering was hired as the project consultant for the Intermodal Surface Transportation Efficiency Act project from Schellville to Willits in January, 1998. NCRA requires Boyle Engineering to provide additional services to include oversight of the recently approved FEMA Improved Project to be worked on concurrently with other projects. The Board packet contains the expanded scope of work. Motion by Ms. Rockefeller. Seconded by Mr. Jehn. Vote taken. Motion carried.

    3. Appointment of Executive Director

      Discussed in Closed Session.

    4. Creditor Repayment Plan

      Mr. Neary presented a Debt Repayment Plan for Board adoption as a policy statement. Mr. Neary fashioned the document from a memo he prepared for the CTC after substantial investigation into the legal issues of public entity debt. He reported that NCRA’s debt has been substantially quantified by Mr. Mustola. In response to NCRA creditor’s requests for some exposition of NCRA’s plans and factors to repay them, Mr. Neary wrote: First, FEMA funds may become available. Second, NCRA has the potential to receive significant real estate revenue, e.g. from the sale of the Ukiah Depot. The sale would insure the creditors to the extent that the money is not in conflict with CTC policy regulating its disbursement. Mr. Neary reports several creditors have requested a commitment from the Board that NCRA would apply the proceeds from the sale to debt reduction. The sale would also fund, beyond the AB2782 monies, the administrative functions of the NCRA. Motion by Ms. Rockefeller providing the paragraph within the document which indicates that any real estate negotiation generating a revenue stream be primarily used to satisfy debt is moved to the end of the document. Seconded by Mr. Stokes. Vote taken. Motion carried. Mr. Jehn abstained.

    5. Consideration of Longitudinal Easement

Dealt with in Closed Session.

  1. Public Comments

    None.

  2. Liaison Report
    1. CalTrans Liaison Committee – Allan Hemphill

      Mr. Hempill reported the CTC reallocated more than $300,000 in TCI funds to the Q-Fund Trust so that NCRA is closer to compliance with the Q-Fund Trust. With anticipated real estate revenues, NCRA expects to comply with the terms of the Q-Fund by the end of September, 1999. This will pave the way for the release of ISTEA funds for track rehabilitation. Additionally, CalTrans will perform follow-up audits with Mr. Mustola in anticipation of the release of ISTEA monies.

    2. Ad Hoc Audit Committee Report – Dennis Wood, Robert Jehn

      No report.

    3. NWPRA Report – John Stokes, Allan Hemphill

      Ms. Rockefeller reported NWPRA was not responsive to NCRA’s request to become involved in a 20-year plan. Mr. Neary reported NWPRA has adopted a budget for the year.

    4. Legislation – David Nelson

      Mr. Jehn reported AB74 has passed the Assembly and is in the Senate Transportation Committee. In addition, SCA3 Legislation is a Constitutional Amendment which, if passed, would allow local transportation tax measures to be passed by a simple majority. Sonoma and Marin Counties may be able to revisit their ballot measures passed last fall as eligible transportation plans. Also, Humboldt County may be able to implement the provisions of last year’s Measure B as an eligible transportation plan.

    5. Passenger – Robert Jehn

      Mr. Jehn reported he received a proposal by California Redwood Coast Co. to rehabilitate some of the passenger cars. He recommends either he or the newly chosen Executive Director schedule a meeting with CRCC to discuss the proposal in a couple of weeks. Carl Myers of CRCC reported on his proposal: providing shelter for the passenger equipment; outlining a general path for equipment repairs; and, the use of the equipment next year.

    6. Cities – Jack McKellar

      No report.

    7. Contractor’s Report – Rail-Ways, Inc.

      Steve Pollock, General Manager, Rail-Ways, Inc. reported Herzog is working in the Schellville Block. Ron Poulsen, Chief Engineer, Rail-Ways, Inc. inspected the track for the FRA and had a difference of opinion with Herzog as to the work performed. Herzog and Rail-Ways, Inc. are working towards correcting those problems. In addition, the tie count was originally underestimated. Mr. Pollock trained 13 employees on the Roadway Worker Program and he will be training Herzog employees as well. The Willits Yard work is complete and has passed FRA inspection. The signal work was performed by MEC Rail which reports the signals are about 40 years behind in design. Mr. Pollock commends the City of Willits for cooperating in the signal repair.

    8. Executive Director Search – Robert Jehn

      No report.

    9. Technical Advisory Committee Report

Mr. Jehn reports the 5-Year Business Plan was before the Sonoma County Transportation Authority Monday. The Committee will meet before the next Board meeting in order to incorporate comments by CalTrans in the Plan for Board approval. Chairman Hemphill explains NCRA will take suggestions under consideration, however, the current version is being sent out as written and NCRA is under no obligation to make changes.

  1. Discussion Items
    1. AB 74 – David Nelson

      Mr. Jehn reported previously.

    2. Strom-Martin Amendments to State of California Budget – John Stokes, Allan Hemphill

Chairman Hemphill reported this proposal did not make it through the State Budget cuts. Mr. Jehn reported he met with Assemblymember Strom-Martin and she does not seem very optimistic about this piece of legislation.

L. Staff Reports

23. Environmental Compliance Issues

Mr. Neary reported this issue was covered with the announcement of a resolution by Consent Decree with the Fish and Game Department, Department of Toxic Substances Control, and the Regional Water Quality Control Board.

    1. Property Management Report – Cyndee Logan

      Ms. Logan reported she presented a handout concerning her work towards a longitudinal agreement. She also reported that a company in Eureka is interested in purchasing a piece of property owned by NCRA. However, a party that was on the property claimed they had purchased the property from the Railroad one year ago. Ms. Logan will investigate this claim. Further, a bridge damaged by water leaking from a pond above the track was researched for ownership and is being removed. Several new leases are in the application and review stage. Chairman Hemphill requested a property revenue list for the current fiscal year.

    2. Track Restoration Project – Rail-Ways, Inc.

      Previously reported.

    3. FEMA Resolution – Christopher Neary, Dennis Wood, Allan Hemphill

Mr. Hemphill reported the FEMA meetings have revolved around two issues; Expiditing the work on the South end by completing the Environmental Review and separating the South end from the North end in terms of type and magnitude of issues which need to be addressed. FEMA previously presented to NCRA a plan for future stabilization of the North end which amounted to almost $800,000 before NCRA would qualify for $10-$15 million of track restoration. NCRA represented by Director Wood is, today, in the final stages of negotiation with FEMA. NCRA proposed to waive funding for 5 to 6 sites, except on an emergency basis, until NCRA mitigates or takes preventative action on those sites providing FEMA releases the current funds obligated. NCRA expects a formal response from FEMA today. Mr. Neary reports FEMA should respond today to NCRA’s administrative appeals as well.

  1. Legal
    1. Environmental Compliance

No report.

28. Report on Ukiah Depot Status

Mr. Neary reported MTA has adopted a revised project description enabling a CEQA document to be prepared concerning the sale of the Ukiah Depot which may transpire by late summer or early fall.

  1. Other Matters From Board Members

Ms. Rockefeller announced the Humboldt County Association of Governments is holding meetings concerning the Humboldt County Regional Transportation Plan. Ms. Rockefeller submitted a report to HCOAG on past passenger operations within Humboldt County. In addition, Ms. Rockefeller reported she rode in a Budd Car in Syracuse, New York, on an intracity commuter train service and is under the impression NCRA needs a Budd Car and would like the Board to keep that in mind.

Chairman Hemphill expressed his optimism with the recent progress of the NCRA in terms of the finalization of many audits, a functioning accounting system ushered in by Mr. Mustola, a promising new Executive Director soon, the successful release of AB2782 monies with support from the CTC, the on-going movement to capture FEMA and ISTEA funds, the operational work and continuing faith of Rail-Ways, Inc., and the exciting activities that Ms. Logan, Property Manager, is persuing.

  1. Announcement of Next Meeting

    The next regular meeting will be held July 21, 1999 in Willits, California.

  2. Adjournment

Meeting adjourned at 11:30 a.m.