Wednesday, April 16th, 2003   10:00 AM


300 Seminary Avenue, Ukiah, Mendocino County, CA


A.              CALL TO ORDER

Chair Sears called the meeting to order at 10:03 am.


B.              ROLL CALL

Roll call was conducted with the following members present: Dave Hull, Allan Hemphill, Robert Simonson, Budge Campbell, and Leo Sears. Chairman Sears presiding.


Directors Absent: Dave Ripple


Also present: Douglas M Christy, Executive Director; Chris Neary, General Counsel; and Dina Polkinghorne, Executive Assistant.


C.              CONSENT CALENDAR

Board Action: Upon motion by Director Campbell, 2nd by Director Simonson, and carried (6-0); the Consent Calendar items 2, and 5 are approved, with items 1, 3 and 4 removed for separate consideration.


D.              AGENDA APPROVAL

Board Action: The following changes to the agenda as proposed were approved with no objections:


The approval of the Finance Committee minutes dated 04/01/03 added to item G.1

The approval of the Property Committee minutes dated 03/07/03 added to item G.2


E.              PUBLIC COMMENT

 James Quinn

Mr. Quinn inquired about the NCRA financial condition and Willdan and other hired consultants – Are they still under contract and what task are they performing. How much longer can the NCRA afford to pay these consultants? Mr. Quinn also inquired whether Congressman Thompson has committed himself to bringing home rail repair funding to his district?  Suggested that the board should make every effort to keep Congressman Thompson involved in the repair of the rail.


John Greene

Stated that he is a shareholder in the California Western Railroad. He supports whatever tough decisions have to be made to open up the rail for freight.


Katie Gibbs

Ms Gibbs represents Skip Gibbs, Inc of Redwood Valley, a long time property leaseholder and purchaser of scrap cars from the NCRA. Ms Gibbs explained that 54 flat cars are marooned on the NCRA line since September 2001and that they are not close enough to access and need to be hauled to their site. Expressed her frustration with the situation.


Chris Burkhart

Mr. Burkhart represents the Mendocino County Railway Society. He expressed frustration with the 18 cars for sale, currently located at the Willits yard – he feels the NCRA should keep and restore the cars. Also frustrated that the shop in Eureka was torn down.


Director Hemphill stated that the decision to sell the cars was made over a year ago by the board as a matter of policy and public record. He also pointed out that the buildings in Eureka belong to Union Pacific, not the NCRA.


Director Sears stated that these buildings were derelict and a haven for vagrants with no utility whatsoever.



F.               CONDUCT OF BUSINESS


1.            Update on NCRA Website - Bob Jehn

Mr. Jehn, who is under contract with the NCRA to maintain its website, went over a prepared report which was provided to the board. He went over various statistical information contained in the report. Mr. Christy stated that he felt the website was an effective tool. Mr. Jehn asked the board if they had any suggestions for the website. Director Hemphill suggested that financial summaries and audit information be added to the website. Mr. Christy agreed. 


2.           Acceptance of Single Year Audit 2001/2002– Stacy Edgmon & Phil Aycock

Mr. Christy informed the board that the Finance Committee already had the opportunity to preview the audit. Stacy Edgmon presented the draft single year audit 2001/2002. Each page, and financial entries were reviewed and explained. She thanked the NCRA staff and the staff of the Sonoma County Auditors office.


Director Hemphill congratulated staff for a clean audit.


Board Action: Upon motion by Director Hemphill, 2nd by Director Campbell, and carried (6-0); the Single Year Audit 2001/2002 was accepted.


3.            Update on NCRA Available Funding – Doug Christy

Mr. Christy went over a handout provided to each board member, which stated the disposition of all available funding sources.










Humboldt County – STIP; non-specific to any project. $625,000. Most likely suspended through 2003-2004.


Mendocino County – 2002 STIP; $780,000 for grade crossings. The contracts have been let, but most of the work has been suspended while awaiting county budget outcome.


Mendocino County – 2000 STIP; $172,000 for Ukiah grade crossings. The work has been programmed but contracts have not yet been let.


Mendocino County – RTIP; $201,000 for Ukiah Depot site improvements such as landscaping and sidewalks and does not include the depot itself. This project has missed 2002 STIP cycle, must program in 2004




TCRP; $41,204,000 for assessment studies, environmental clean-up, environmental studies, preliminary engineering, ROW, and construction projects. The status is indefinitely suspended awaiting legislative action.


AB 2908; $661,027 for rehabilitation and rolling stock acquisition. This funding is at risk and seeking legislative action.


Proposition 116; $72,000 for ROW acquisition, grade crossings and safety upgrades. This is a bonded program not currently in jeopardy. 


Proposition 116; $166,000 for ROW acquisition, grade crossings and safety upgrades. The NCRA’s repayment of audit exception will replenish fund.




ISTEA; $8,937,500 for transportation enhancements. FHWA controlled – awaiting NCRA rescoped project.


TEA-21; $229,992 for rail infrastructure improvements supporting the Port of Humboldt Bay. Funding is awaiting defined project.


FEMA/OES; $8,300,000 originally obtained for use north of Willits, but that is no longer valid with the suspension of the TCR funds. This funding is at risk to be deobligated.


Mr. Christy further reported that a meeting has been scheduled for May 2nd, 2003, with OES/FEMA regarding the FEMA/OES funding. If FEMA does not designate these monies to the NCRA by the deadline, they have indicated that they are under pressure to shift these monies to Homeland Security. FEMA/OES is requiring the NCRA to design an alternate project from the original plan with a 10% reduction penalty in the funding, bringing the amount to $7.4 million. The south end of the railroad can be reopened much quicker and with greater ease and that is where Mr. Christy recommended that the focus of this redesigned project be. He also explained that there is a 60-mile length of track between Cloverdale and Ignacio that may not be included in this project, but the remaining 80 miles of the south end is open for funding from FEMA/OES. He advised the board to adopt a resolution at the next board meeting in May regarding the alternate plan for the south end, so that the NCRA could formally go before FEMA/OES to meet the deadline.


Director Hemphill asked whether there has been any broadening on what the actual money can be used on. Mr. Christy explained that the rules have been significantly relaxed due to their extreme sense of urgency to close this project out, and that the funding could be used for such things as purchasing equipment and materials. Director Hemphill inquired how quickly the funds could be accessed. Mr. Christy pointed out that after the board passes a resolution the process could go very quickly, within a couple of months.


Board Action: Upon motion by Director Campbell, 2nd by Director Simonson, and carried (6-0); staff directed to create a resolution regarding the reopening of the south end of the rail.


4.           Discussion on Seeking Outside Professional Funding Support

Mr. Christy explained that the reauthorization of T3 funds is at a critical point, and that it was his opinion that professional services are needed to work with legislators. He also stated that under NCRA policy the Executive Director may use his or her discretion to solicit legal services when they are needed. Council Neary confirmed this policy and reiterated the urgency involved in this issue.


Board Action: Upon motion by Director Hull, 2nd by Director Hemphill, and carried (6-0); the board authorizes Executive Director Christy to seek outside professional services for funding support, according to NCRA Independent Contractor Policy, utilizing approximately $25,000 available from remaining Task Order 5 monies, $20,000 from the property fund, all of which shall not exceed $45,000.


Adjourn for a break: 12:00 noon

Resume: 12:13pm




1.      Finance Committee

Committee Action: Upon motion by Director Campbell, 2nd   by Director Hemphill, and carried (3-0); the Finance Committee minutes dated 04/01/2003 were approved.


Chair Sears appointed Allan Hemphill Chairman of the Finance Committee.


Board Action: Directed staff to remove the Financial Summary from the Consent Calendar and agendize it for all future meetings.


2.           Property Committee

Committee Action: Upon motion by Chair Simonson, 2nd by Director Sears, and carried

(3-0); the Property Committee minutes dated 03/07/2003 were approved.


3.           Passenger Committee

Director Hemphill reported that he has been reviewing the remaining transactions and that he and Mr. Christy are working on collecting all outstanding revenue.


Board Action: Directed staff to arrange for the cleaning and securing of the remaining passenger cars in Willits.


4.           NWPRA Ad Hoc Committee

Chair Sears reported that the committee met on Monday, April 14th, 2003 and that they are   pursuing a satisfactory turnover of assets to SMART. The committee is working to have the NCRA concerns regarding this transfer addressed in a political manner.


Director Campbell addressed his concerns regarding the NCRA’s position in the NWPRA, in particular, the NCRA’s seemingly unequal position within the NWPRA. He stated his concern that the NCRA become very possessive of the corridor between Healdsburg and Willits. 


H.              STAFF REPORTS


1.             Executive Director  - Doug Christy

Mr. Christy reported that the Chesbro Resolution passed in committee and is moving forward in a timely fashion. It was his opinion that the resolution could be before the Governor by the end of May.


2.                General Council – Chris Neary

Nothing to report. 

Adjourn for closed session: 12:40pm


I.                CLOSED SESSION

1.             Conference with Legal Counsel – Existing Litigation

Government Code Section 54956.9 (a)

Mass Electric vs.. Rail-Ways et al, Mendocino Superior Court Case # 85230


2.           Conference with Legal Counsel – Anticipated Litigation

  Significant Exposure to Litigation

  Government Code Section 54956.9 (b)

                                                                                              Reconvened at 1:40 pm




1.             The board gave direction to counsel regarding existing litigation.

2.              Due to the substantial progress of the Restructuring Program, the board unanimously

voted that the Standstill Agreement between the NCRA and NWPY be extended to May 21st, 2003.






 Regular Board Meeting – May 21st, 2003 10:00 am

 Eureka, City Council Chambers, 531 K St. Room 208

 Eureka, Humboldt County, CA 


M.          ADJOURNMENT at 1:42pm