Special MEETING Minutes

BOARD OF DIRECTORS

MONTECITO WATER DISTRICT

583 San Ysidro Road, Montecito, CAlifornia

WEDNESDAY, NOVEMBER 25, 2009

9:00 A.M.

1. CALL TO ORDER, ROLL CALL, DETERMINATION OF QUORUM

President Shaikewitz called the meeting to order at 9:00 a.m.

Directors Present:

Directors Jan E. Abel, Samuel Frye, W. Douglas Morgan, Richard Shaikewitz, and Larry Wilson

Directors Absent:

None

Staff Present:

Tom Mosby, General Manager

Chip Wullbrandt, District Counsel

Lois Werner, Recording Secretary

Guest Present

Lauren Hanson, GWD

Charles Hamilton, CVWD

Bill Ferguson, CSB

Kate Rees, COMB

Matt Bloise, Santa Barbara News-Press

2. PUBLIC FORUM

There were no members of the public present who wished to speak on items not on the agenda.

3. COMB CIP

A. CLARIFICATION OF MWD BOARD ACTIONS TAKEN AT THE BOARD MEETINGS OF OCTOBER 12, 2009 AND NOVEMBER 17, 2009.

Mr. Wullbrandt and Mr. Mosby discussed with the Board the status of actions previously taken by the Board which had been altered or set aside by subsequent actions of COMB and other MUs. Ms Hanson described the action taken by GWD, and Ms Rees described action taken by the COMB Board at their meeting on November 23 to reject all bids on the 2^nd barrel project.

B. MWD COMB 2^nd BARREL CIP PARTICIPATION AND FUNDING

President Shaikewitz asked the visitors from COMB and from other COMB member units to present the positions of their boards and / or staff and respond to Directors’ questions. After further discussion, and input from Counsel, it was moved by Director Frye, seconded by Director Morgan and carried on a vote of four to one with Director Wilson opposed to direct staff to immediately prepare a resolution in accordance with staff recommendation #1.

After a recess, staff and Counsel presented Resolution No. 2061. It was moved by Director Abel seconded by Director Morgan, and carried by the following roll-call vote to Approve Resolution No. 2061;

1. Ratifying COMB capital expenditures of approximately $10.4M for the 2^nd Barrel Project;

2. Ratifying COMB issuance of the 2009A COMB Bonds on behalf of the City of Santa Barbara and Goleta Water District;

3. Authorizing execution of a Contribution Agreement and Indemnification Agreements for Montecito Water District’s participation in funding of 13.1% (percentage subject to adjustment pursuant to (c) below) of the cost of the COMB CIP Second Barrel Project subject to:

a. Participation and funding by the City of Santa Barbara (CSB) at a percentage of 40.87% and the Goleta Water District (GWD) at a percentage of 46.03% for the Second Barrel Project (both percentages also subject to (c) below).

b. Reimbursement to MWD for its proportionate share of Proposition 50 grant money received by COMB for the 2^nd Barrel project;

c. Revise MWD’s Contribution and Indemnification Agreements to allow for proportionate reallocation amongst the funding participants of any contribution from other parties.

AYES: Directors Abel, Frye, Morgan, Shaikewitz

NOES: Director Wilson

ABSTAIN: None

ABSENT: None

MWD participation in the other selected COMB CIP priority projects may be considered on a project-by-project basis and conditioned on MWD’s previously approved funding commitment and the participation of CSB, GWD and CVWD at the prescribed percentage of costs.

4. LEGAL MATTERS

A. Closed Session – CONFERENCE WITH LEGAL COUNSEL--ANTICIPATED LITIGATION — Significant exposure to litigation pursuant to Government Code section 54956.9(b): one case.

The Board adjourned to closed session 11:32 a.m.

The Board reconvene to open session at 12:48 p.m. The President reported that no action had been taken.

5. PROPOSED MWD / CVWD SERVICE BOUNDARY REORGANIZATION

Mr. Mosby introduced this item. Following discussion it was the consensus of the Board to agree to replace the Lambert Rd. water main within seven years and seven months and, in the event that MWD incurs costs in the upkeep of the main before that time, those costs will be billed to CVWD up to $5,000 annually, with all additional costs to be borne by MWD. Staff was directed to communicate the Board’s actions to CVWD.

6. AGENDA ITEM REQUESTS

There were no requests from Directors for items other than regular agenda items for the next regular Board meeting scheduled for December 16, 2009.

7. ADJOURNMENT

There being no further business to come before the MWD Board of Directors, the meeting was adjourned at 12:52 p.m.

Approved:

_____________________________

Richard Shaikewitz, President

Attest:

__________________________________

Tom Mosby, Secretary