Annual Meeting Minutes - Atascadero Mutual Water Company

MINUTES OF ANNUAL MEETING OF SHAREHOLDERS
ATASCADERO MUTUAL WATER COMPANY
May 18,2016
The meeting convened at the office of Atascadero Mutual Water Company, 5005 El Camino
Real, Atascadero, at 6:40 p.m.. President Frank Platz presiding. Others present were Vice President
Brien Vierra, Directors Leroy Davis, Robert Jones, and Jackie Lemo, General Manager John Neil,
and Assistant Secretary Lorraine Halderman.
CALL TO ORDER AND ANNOUNCEMENT THAT QUORUM IS PRESENT: The President
announced that a quorum was present and the meeting was called to order.
PROOF OF NOTICE OF MEETING: The President reported that notices were mailed to
shareholders of record on April 15, 2016. Notices were also published in the Atascadero News on
May 6, and May 13, 2016, and posted on AWMC's website; proof of notice is on file in the
Company office.
ANNOUNCEMENT OF INSPECTORS OF ELECTION; The President announced that John
Hollenbeck, Jim Patterson, and Don Vert were appointed to act as Inspectors of Election.
NOMINATION OF DIRECTORS: The President announced that the following people were
nominees to be directors: Leroy R. Davis, Robert M. Jones, Jackie M. Lemo, D. Frank Platz, and
Brien C. Vierra. The President asked if there were additional nominations from the floor, and there
were none.
BALLOTING: The President requested that ballots be completed and deposited in the ballot box.
PUBLIC COMMENT: There was no public comment.
PRESIDENT'S REPORT: Copies of the President's Report were distributed to the shareholders
in attendance.
INTRODUCTION OF STAFF WHO HELPED WITH THE ANNUAL MEETING: The
President thanked the staff for their assistance with the meeting.
REPORT OF INSPECTORS OF ELECTION: Inspector John Hollenbeck reported that 43,928
shares were presented by proxy or in person, representing 43% of the total shares of the Company,
with the results of the voting as follows:
Leroy R. Davis: 43,369 Robert M. Jones: 42,918
Jackie M. Lemo: 43,237 D. Frank Platz: 43,314
Brien C. Vierra: 43,351
5/18/16
Atascadero Mutual Water Company Annual Meeting
The meeting was adjourned at approximately 7:00 p.m.
Li/to/ clLomi
Lorraine Halderman, Assistant Secretary
2
Atascadero Mutual Water Company Annual Meeting
5/18/16
PRESIDENT'S REPORT
SUMMARY FOR FISCAL YEAR ENDING APRIL 30, 2016 (FY 2016)
WATER DEMAND AND SUPPLY
Groundwater levels in the Salinas River alluvium and the Atascadero basin are near their
historic averages for May, even with less than average rainfall this past winter. It is expected that
the high groundwater levels will reduce AMWC's use of water from the Nacimiento Water Project
this coming summer.
AMWC shareholders reduced overall water use by 27% in 2015, when compared to 2013.
Total annual water demand in 2015 was the lowest since 1983. It is expected that water demand
for 2016 will continue to be low due to heightened public awareness of the drought and the
conservation mandates being imposed on urban water suppliers by the State.
NACIMIENTO WATER PROJECT
The Nacimiento Water Project operated as designed during the summer of 2015. AMWC received
nearly 3,000 acre-feet of water from the project between April 1 and October 30. Water levels rose by 45
feet in the main well field between April 1 and October 30.
AMWC continues to make debt service payments of $2.6 million/year for the project plus
$900,000/year in operating and maintenance costs.
NEW SERVICE CONNECTIONS
Connection fees for 81 equivalent dwelling units (EDU) were paid in FY 2016, down from 125 EDUs
in FY 2015. An EDU is the amount of water an average single-family residence uses in one year and
represents the impact a new water service will have on the water resources.
CAPITAL INVESTMENTS
In FY 2015, approximately $1.7 million was expended on capital investments to AWMC's water
system and other facilities.
The capital investment program focuses on the replacement of existing facilities and is intended to
fully offset the depreciation of the water system. AMWC coordinates many these improvements with City
and County street improvement projects to avoid cutting into new pavement and to reduce cost.
Capital investments made in FY 2016 included:
• upgrading customer information and accounting systems software
• upgrading the Summit Hills booster station
• painting the Random Oaks Tank
• upgrading the SCADA alarm software and server
• realigning the pump main that serves the Santa Ana tank
• installation of an inner casing and new pump and motor at Well No. 4
• replacing numerous water main valves
• upgrading fire hydrants
• replacing over 200 obsolete/leaking water services
• purchase a replacement 350 kW standby generator to conform with AB 32 requirements
3
Atascadero Mutual Water Company Annual Meeting
5/18/16
OTHER ITEMS:
WATER RATES
AMWC increased water rates by 15% in April 2016 as a result of the year-over-year decline
in water sales caused by the State conservation mandate and other regulatory factors.
PASO ROBLES GROUNDWATER BASIN:
Steinbeck Vineyards et al. have filed a quiet title action over water rights in the Paso Robles
Basin naming AMWC, City of Paso Robles, Templeton CSD, and San Luis Obispo County as
defendants. All defendants in the action have responded and the case is making its way through
the court system.
SUSTAINABLE GROUNDWATER MANAGEMENT ACT:
The State adopted the Sustainable Groundwater Management Act (SGMA) in September
2014. The act requires Groundwater Sustainability Agencies to be formed and the creation of
Groundwater Sustainability Plans to manage groundwater extractions from groundwater basins in
California.
In March 2016, the Templeton Community Services District submitted an application to the
Department of Water Resources to separate the Atascadero Basin from the Paso Robles Basin by
recognizing the barrier to groundwater flow created by the Rinconada Fault. AMWC, the City of
Atascadero, and other entities fully the separation of the two basins. A preliminary determination
on the separation is expected in June.
The stakeholders in the Atascadero Basin continue with their efforts to create a
Groundwater Sustainability Agency and plan for the Atascadero Basin as required by SGMA .
AMWC continues to lead this effort.
PERSONNEL EVENTS:
• Milestone Anniversaries:
o 10-year - Rose Babcock, Jason Straeck, Lorraine Halderman
o 15-year-John Neil
• Average employee tenure -11.6 years.
4