NORTH COAST RAILROAD AUTHORITY (NCRA)

BOARD OF DIRECTORS REGULAR MEETING MINUTES

 

WEDNESDAY, SEPTEMBER 18, 2002 AT 10:00 AM

 

HEALDSBURG CITY COUNCIL CHAMBERS

401 GROVE STREET, HEALDSBURG, SONOMA COUNTY, CALIFORNIA, USA

 

A.        CALL TO ORDER - 10:05 am by Chair, David Ripple

 

B.        ROLL CALL

Present:            Chair David Ripple, Vice Chair Allan Hemphill, Second Vice Chair Leo Sears, Director Robert Simonson, Director Budge Campbell, Director Bruce Burton.

Absent:             Director John Woolley

Also Present:    Executive Director Max H. Bridges, Assistant Executive Director Douglas M. Christy, Admin. Asst. Louise Evans, and General Counsel Christopher J. Neary.

 

C.        AGENDA APPROVAL

                 

Director Campbell moved to add Regular Board Meetings Minutes of August 13, 2002 and a closed session item of potential litigation to agenda; 2nd by Director Sears.

 

Agenda:

1.                  Regular Board Meeting Minutes of August13, 2002.

Modifications of Minutes: E. Conduct of Business; 1. Status Report of Eel River RR will read: Director Sears read a letter from Mr. Niemeyer extending his proposal for 30-days and asked that the Board accept the email and reaffirm Director Sears and Director Simonson for any communication with Mr. Niemeyer.

 

2.                  Item of Potential Litigation – Closed Session

               

Vote taken; motion carried unanimously with modifications.                          

 

D.        PUBLIC COMMENTS

 

Mr. Mike Pechner:  Expressed his dissatisfaction with the lack of success in reopening the Railroad.

 

James Quinn: Voiced his disappointment with the many delays for the NWP returning to service.  Preventative maintenance is needed along the Eel River Canyon.

 

E.         CONDUCT OF BUSINESS

 

1.            Independent Audit

Mr. Bridges recommended accepting the proposal from Aycock & Edgmon to perform the 2001-02 audit for an amount not to exceed $16,150.

 

Director Campbell moved to accept proposal from Aycock and Edgmon with modifications.  Pg 2, Audit Services, 2nd paragraph, the first sentence will read: The examination will be conducted in accordance with generally accepted auditing standards applicable to local agencies using state and federal, transportation and storm damage funds for storm damage repair and will include…;2nd by Director Sears.

 

Vote taken, motion carried unanimously with modifications.

 

2.            Independent Review of Debt Reduction

Aycock and Edgmon completed their review of the distribution of $10 million from Traffic Congestion Relief Funds.  Upon acceptance they will produce the final version for distribution.

 

Director Sears moved to accept Independent Review; 2nd by Director Simonson

 

Vote taken, motion carried unanimously.

 

3.            TCRP Applications

Requested funding for the completion of the environmental documentation phase, including the preliminary engineering and right of way support required to complete the anticipated EIR/EIS.

 

District 1 staff advised that Caltrans and CTC requested that the application be reduced to the preliminary environmental assessment and supporting activities only.  The funding for the EIR/EIS component would then be requested in a subsequent application.

 

Staff and Board members discussed the current applications, the environmental process and the potential for flexible utilization of the remaining FEMA/OES 1203 funds to move forward with various capital projects and/or operational needs.

 

Director Sears moved to drop present request to CTC for funding in October and ask for November placeholder in order that alternative uses of FEMA funds can be explored and information provided answers on how the FEMA funds can and cannot be used; 2nd by Director Hemphill.

 

Vote taken; motion carried unanimously.

 

4.            Financial Report from Sonoma County

Mr. Bridges acknowledged having an excellent working relationship with Sonoma County Auditor-Controller’s Office staff and introduced Eric Roeser and Donna Dunk.

 

A brief presentation was given from Mr. Roeser and Ms. Dunk, explaining the monthly reporting documents.

 

Director Sears moved to receive report; 2nd by Director Hemphill.

 

Vote taken, motion carried unanimously.

 

5.            Payment of Caltrans Audit Exceptions

Caltrans audits of the Proposition 116 payments to Railways and Herzog identified approximately $166,000 that was not properly supported for a variety of reasons and must be repaid to the State.

 

Director Hemphill moved to approve payment to Caltrans in five annual payments beginning in the current fiscal year; 2nd by Director Sears.

 

Vote taken, motion carried unanimously.

 

6.            Partial Payment on Q-Fund Loan

An audit exception dealing with the purchase of the railroad using the Q-Fund money resulted in Caltrans paying FHWA $1.3 million and Caltrans requested that NCRA reimburse that amount.  With this payment, the amount due in 2013 is reduced from $12 million to $10.7 million.  However, the early payment from the fund results in an anticipated $800,000 shortfall in 2013.  It was acknowledged that NCRA should seek funding that would retire this obligation early freeing funding for capital project needs.

 

Director Sears moved to approve payment to Caltrans to reimburse what has been paid to FHWA; 2nd by Director Campbell.

 

Vote taken, motion carried unanimously.

 

7.            FY 2002-03 Budget

Final Budget for adoption.

 

(The Finance Committee meeting of September 17, 2002, was cancelled due to lack of quorum.)

 

 Director Campbell moved to approve expenditure of $135,000 for consulting activities, on an as needed basis, from property funds and deferred budget to Finance Committee for review; 2nd by Director Burton.

 

Vote taken, motion carried unanimously.

 

Finance Committee will meet on September 23rd, 4:30 pm at Cloverdale Depot to discuss the Financial Report.

 

8.            Contract with Mustola Management

Mr. Mustola’s current contract expired August 31, 2002 with work still underway.  It will now be necessary to extend the completion date to September 30, 2002 and increase the total compensation to a not to exceed amount of $40,000.  That will allow for an additional 150 hours of service at the original hourly rate.

 

Director Simonson moved to approve the second revision to the contract extending the completion date to September 30, 2002, and increasing total contract amount to $40,000.  All other conditions of the original contract are to remain in effect, authorizing the Executive Director to sign the revised contract; 2nd by Director Sears.

 

Vote taken, motion carried unanimously.

 

9.            Executive Director Position

Mr. Bridges informed the Board of Directors that his last day as a full time employee with North Coast Railroad Authority would be April 28, 2003.  He is willing to assist in any way with the recruitment process and recommends Doug Christy as his successor. 

 

Mr. Bridges stated that he remains very interested in continuing to support the effort of the goal of re-establishment of rail service to the North Coast in the capacity of consultant, part time employee, and/or volunteer depending on the assistance desired.

 

Director Simonson moved that an Ad hoc committee of Directors Campbell, Sears and Simonson be implemented to search for successor; 2nd by Director Sears.

 

Vote taken, motion carried unanimously.

 

F.        COMMITTEE REPORTS

 

1.             Passenger – Director Hemphill 

 

Director Hemphill expressed concern with the need for completion of the sale.  Mr. Bridges advised that there are issues with the distribution of any proceeds due to liens and conditions from grant funding for the original purchase.  Director Simonson requested a letter of appreciation regarding action by City of Willits staff.

 

2.             Property Management – Directors Sears, Campbell, and Simonson

 

Mr. Bridges advised of the need for a meeting and Director Sears requested teleconferencing if possible.

 

3.             Finance Committee – Directors Simonson, Burton and Campbell

No meeting due to lack of quorum.

Adjourned for closed session at 12:55 pm

                                         

G.        CLOSED SESSION

 

H.        ANNOUNCEMENT OF ACTION TAKEN IN CLOSED SESSION 

Reconvened at 1:45 pm

 

1.             Conference with Legal Counsel – Existing Litigation - Government Code 54956.9(a).   Hardin Cook et al. vs. NCRA, Mendocino Superior Court Case SCUK-CVG-02-88417

 

Met with General Counsel and received information.  No action taken.

 

I.          STAFF REPORTS

1.              Executive Director Max H. Bridges

Reported that letter to CAO’s and City Managers requesting local funding support will be distributed with copies to the Board.

 

2.             Assistant Executive Director Douglas M. Christy

Reported that the operational shortfall identified in the Rail Feasibility Report is generating the concern for additional funding.

 

The environmental cleanup activities required by the Consent Decree are underway with TCR funds.  Perhaps the additional flexibility that appears to be available with the FEMA funds may create an opportunity for addressing any potential shortfall in Consent Decree compliance.

 

The Board commissioned $15,600 to pay PB Ports & Marines for an Economic Impact Report.  This report quantifies the effect of no railroad.  It is quite detailed and county specific.  Clearly Humboldt County is the most affected. 

 

Request for funding to update the Draft Final Report, “The Long Term Financial Feasibility of the Northwestern Pacific Railroad”, released July 2002.

 

Director Sears moved to add to next meetings agenda information from Mr. Christy regarding scope of work needed to revise the data report; 2nd by Director Simonson.

 

Vote taken, motion carried unanimously.

 

Director Sears moved to authorized expenditure not to exceed $10,000 to PB Ports & Maine Consultants to update the Draft Final Report, “The Long Term Financial Feasibility of the Northwestern Pacific Railroad”, released July 2002; 2nd by Director Hemphill.

 

Vote taken, motion carried unanimously.

 

3.             General Counsel Christopher J. Neary

Nothing to report.

 

J.                MATTERS FROM BOARD MEMBERS

 

Director Burton requested that Counsel provide a response to a recent letter to the editor challenging the Legislative Counsel opinion regarding sale of the railroad. 

 

Counsel Neary also agreed to provide information on the possible transfer of ownership of a historic crossing protection device.

 

K.        ANNOUNCEMENT OF NEXT MEETING

               

Regular Board Meeting – October 16, 2002, 10:00 am

Willits City Council Chambers, 111 East Commercial St, Willits, Mendocino Co, CA, USA

 

L.               ADJOURNMENT 2:50 pm