CLEARLAKE OAKS, Calif. – On Thursday the Clearlake Oaks County Water District Board directed staff to bring back a draft ordinance that would increase compensation for meeting attendance, but voted against a proposal to give board members health insurance.
About 50 people attended the meeting, held Thursday afternoon at the Live Oak Senior Center rather than the district's headquarters due to the need for more space.
Increased compensation or health insurance for board members initially was proposed at the board's August meeting.
The board considered raising the compensation for meetings to $100, for a maximum monthly compensation of $600 per board member. Currently, board members get $25 for a special meeting or $50 for a regular meeting.
Alternately, the board members would be offered full health insurance – medical, dental, vision and employee assistance program – at a monthly cost to the district of $679 per board member, or dental, vision and the employee assistance program only for $76.
Board members, under the original proposal, could have one or the other, but not both compensation and insurance. Insurance also wouldn't be covered for family members. It was for board members alone, during the duration of their terms.
The proposal was estimated to cost the district $40,000 a year, a more than tenfold increase over what is paid out currently to board members for attending meetings.
Board President Iris Hudson said that total expenditures for board members' pay totaled $3,700 in 2011; $3,125 in 2012; $3,175 in 2013; and for the year to date, $2,725. That's a four-year total of $12,725.
Actually voting to make those changes could not take place on Thursday, as the board – which had asked County Counsel Anita Grant for legal guidance on how to handle the proposal – found that a public hearing hadn't been properly noticed according to legal guidelines.
Increasing board member compensation also can't be done simply by motion, but requires an ordinance be prepared, which hadn't been done, Hudson explained.
In the end, after hearing from a number of concerned ratepayers, the board majority directed staff to come back with a draft ordinance giving board members $100 per meeting, capped at two meetings per month, but to forgo the health insurance proposal.
Researching past practice
Board member Richard Kuehn handed out to audience members copies of the district's Ordinance No. 45, passed Feb. 19, 1997.
Based on California Water Code, the ordinance gave each board member $100 per day for each day's attendance at board meetings, “or for each day's service rendered as a member of the Board by request of the Board,” not to exceed six days in any calendar month.
Ordinance No. 45, Kuehn said, doesn't appear to have been rescinded, based on staff research.
However, for some years board members haven't received that amount. In January 2010, the board – which then also was receiving $50 per regular meeting – directed the district's general manager to draft an ordinance which would rescind Ordinance No. 45, set a cap on the amount of compensation and state that, from that point on, compensation would be established by resolution.
However, district staff never brought back the ordinance – along with a resolution to put a limit on the compensation amount – as directed by the board.
During public comment, close to 20 community members spoke to the board about the proposal, most of them coming down against any increase in compensation or benefits. A small group favored giving the board a small raise, but not insurance.
Others felt the discussion was premature. With the district preparing to begin grant-funded studies of its infrastructure needs, it was suggested that the board should hold off and instead put its money toward system repairs.
Kuehn told the group that the increased compensation and benefits were needed to attract potential board members, with candidates having been in short supply in recent years.
However, for the most part, those who spoke disagreed with that viewpoint, noting that many local groups – including the board overseeing the senior center where the meeting took place – had volunteers who worked for free.
Judy Barnes said she disagreed with the suggestion that health benefits or larger stipends would attract better board candidates.
“I wonder why we're even talking about this when we have millions of dollars of infrastructure repairs needed,” Barnes said.
Board urged to spend district's money wisely
Chuck Lamb said 45 percent of the water the district produces is going into the ground and a water tank may need to be replaced. There also are miles of cement asbestos water mains that are well beyond their 50-year service life and are crumbling, which he said is why there are leaks.
From a business standpoint, when facing millions of dollars in repair work, “You dig your heels in tight and you spend money wisely,” said Lamb, who suggested that the $40,000 that was proposed to be spent on benefits and insurance could do a lot for repairs.
Lamb suggested that the kind of pay and benefits proposed would attract people whose first priority would be to get compensated, with the district and the community being the second priority.
Kuehn, in response to Lamb's comments, said the board oversees an organization with a large amount of money – the annual budget is about $2.2 million – and monitoring the district's operations takes analytical thinking, time, effort and work.
“My skills save you so much more money than $40,000, than $400,000,” said Kuehn, who added that he has not taken any compensation during his time on the board.
Longtime resident Dennis Pluth, who remembered the community before the water company, said the district has truly improved water quality, adding it's the best water around the lake.
Pluth himself was a board member in 1982, noting it was a hard job. “We worked long, hard hours.”
He said he thought the board's members deserved to be compensated, but didn't want to offer insurance. Instead, he said they could use the cash they receive to pay for benefit.
Jim Steele, who along with wife Olga is a former district board member, said he didn't believe offering board members more compensation would have changed any of the problems the district experienced several years ago. He said he felt the board was “wrongheaded” on the proposal.
Bill Rett told the board that insurance was not the route taken by most nonprofit entities in offering compensation. He said 98 percent of boards don't compensate outside of small stipends.
“If compensating board members was a good idea, wouldn't you think the majority of nonprofit organizations would do so?” Rett asked.
Board member Judy Heeszel moved to direct staff to draft an ordinance to rescind Ordinance No. 45 and draft a new ordinance for director compensation that would institute a $100 total for each meeting, to be capped at two per month.
The motion passed 3-2, with Heeszel, Hudson and Robert Kiser voting yes, and Kuehn and Dena Barron voting no.
Kuehn moved to carry forward the consideration of offering board members insurance to the October meeting, with Barron seconding.
However, the board majority – Heeszel, Hudson and Kiser – voted no, with Barron and Kuehn giving the yes votes.
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