MINUTES OF THE INFORMATIONAL MEETING OF DIRECTORS
OF THE WATER WORKS BOARD OF THE CITY OF BIRMINGHAM
August 22, 2014
The informational meeting of the directors of The Water Works Board of the City of
Birmingham was held on Friday, August 22, 2014, at 12:30 p.m., at 3600 First Avenue North,
Birmingham, Alabama.
The following Directors were present: A. Jackie Robinson, III, Sherry W. Lewis, Ann D.
Florie, and George Munchus. David S. Herring was not in attendance
Inasmuch as four of the Directors were present, a quorum was in attendance.
The meeting was also attended by: Mac Underwood, General Manager; Sonny Jones,
Darryl Jones and Michael Johnson, Assistant General Managers; Tammy Wilson, Administrative
Assistant; Binnie Myles, Ben Sorrell, Tom Helms, Rick Jackson, George Anderson, Joyce
Jordan and Iris Fisher, Board Employees; Charlie Waldrep, K. Mark Parnell, Kelvin Howard and
Mary Thompson, Waldrep, Stewart & Kendrick, LLC; Jerry Jones and Patrick Flannelly,
Arcadis; Mark Dolan and Kirk Mills, Volkert & Associates, Inc.; Jesse Lewis and Dorian
Kendrick, The Lewis Group; Chandra Abesinga, C. E. and Associates; Dan Meadows, SS
Nesbitt and Company, Inc.
Mac Underwood called the meeting to order at 12:38 p.m. and welcomed the meeting
body. Assistant General Manager Darryl Jones opened the meeting with prayer.
Under old business, Joyce Jordan was recognized and gave an update to the Board on the
status of the upcoming H2O Foundation Charity Golf Tournament. Ms. Jordan explained that
this was the 10th anniversary of the tournament adding that a souvenir booklet would be
designed and distributed at the tournament to commemorate the milestone. Last year the
Foundation raised $60,595. This year’s goal is $100,000 and $65,000 has been collected or
committed so far according to Ms. Jordan. Ms. Jordan stated she is still looking for more
sponsors, teams, door prizes and goodie bag items. Chairman Robinson asked when the
tournament is scheduled. The date of the tournament this year is Friday, September 12th Ms.
Jordan stated. Director Munchus asked for an explanation of the H2O Foundation’s purpose.
The H2O Foundation consists of a Board of Directors and works in conjunction with The
Salvation Army to help those less fortunate in need of assistance with water, sewer and plumbing
bills Ms. Jordan stated. Director Florie added that the H2O Foundation is a 501(C) entity and
has its own separate Board. The annual golf tournament helps fund the administrative costs for
the organization according to Mac Underwood, adding that both he and Charlie Waldrep serve
on that Board.
Next, General Manager Mac Underwood requested Board approval for himself to enroll
in the University of Alabama – Master Management Certification Program with the first session
to begin September 2014 at an estimated cost to the Board of $5,000 and to pay any other fees
and costs associated with attending the program. Mac Underwood explained that the program is
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designed for advanced management training for leadership. A motion was made and seconded,
and the following resolution was adopted:
“BE IT RESOLVED By the Water Works Board of the City of Birmingham (“the
Board”), on a motion duly made by Ms. Sherry W. Lewis and seconded by Mr. George
Munchus, that the Board hereby authorizes the General Manager to enroll in the University of
Alabama – Master Management Certification Program for 2014 – 2015 (fall and spring classes),
wherein the Board hereby authorizes payment of any books and other fees as well as any travelrelated expenses to complete said program. The cost is $995.00 per class. Resolution No. 6737
is hereby adopted by unanimous vote on August 22, 2014.”
************************
Following, General Manager Mac Underwood recognized Assistant General Manager
Michael Johnson who was asked to present the Finance and Administration Division Report as
set forth in agenda item 3. Mr. Johnson reviewed and discussed the details as outlined in the
Finance and Administration Division report for month ended July 2014. Michael Johnson
reported that the customer metered consumption YTD through July indicated a decrease of 1%.
Under operating revenue, Mr. Johnson stated BWWB is over budget by $225,314, operating
expenses are under budget by $1,136,962 and net operating revenue is over budget by
$1,362,276 for the month. Mr. Johnson went on to explain that the 2014 adjustment rate for the
pension plan caused the decrease in expenditures in the budget.
Overall revenue is down;
however expenses are less than what was projected, according to Mr. Johnson. The employee
healthcare costs are $120,936 under budget year-to-date. Both power and chemical costs are
under budget. Labor costs are under budget as well. Overtime is over budget in the amount of
$61,242. Under the reserve fund summary, the net unrestricted reserve fund balance as of July
31, 2014 was $83,837,100. July 2014 year-to-date minority vendors total was 47 with 14
awarded bids and quotes. A total of $935,197 has been awarded in bids and quotes for the period
ended July 2014. Mr. Johnson stated the IVR usage continues to climb and at July 2014 was at
26,630. Customers using E-Billing continues to climb as well according to Mr. Johnson. The
total number of active policies as of August 8, 2014 with the HomeServe U. S. A. warranty
program is 14,807. Mr. Johnson added that HomeServe U. S. A. would be coming to update the
Board on employee referrals and customer related issues next Wednesday. Director Lewis asked
Mr. Johnson which departments were responsible for the overtime. Michael Johnson stated
distribution, because they are the largest department and customer support field services were
responsible for some of the overtime adding he would put together a more detailed report on the
overtime for July 2014 for the Directors. Some discussion took place concerning USX and the
fact that their consumption has decreased. Chairman Robinson asked for a more detailed report
on the new customers’ consumption; such as Regions Park. Mac Underwood stated companies
have put conservation measures in place; therefore we have seen some decrease in consumption.
Director Munchus asked if the BWWB served the Hoover Met. Mac Underwood replied yes and
the system continues on to Morgan Road and down South Shades Crest Road to Highway 52.
Next, Assistant General Manager Sonny Jones reviewed and discussed the details as
outlined in the Engineering and Maintenance Division report for month ending July 2014 as set
forth in agenda item 3. Under the CIP Metrics slide, the approved budget amount is
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$54,992,023, the forecasted budget amount is $54,993,660 and the actual expenditure amount is
$21,675,009 Sonny Jones stated. Staff was able to get the easement the Board needed in relation
to the Carson Loop Project at the council meeting in Leeds Monday night Sonny Jones added.
Capital Projects were highlighted with Sonny Jones stating Western Filter Plant Rehab site
progress is ongoing at the backwash supply pump station, north of the polymer building and
sludge pump area, south of the polymer building area and filters 1A-4B HVAC units. Other
capital projects include the Putnam Raw Water Tank which is under construction at a cost of
$667,000, a mobile de-watering press which has been ordered at a cost of $1,000,000, the Inland
Lake Dam and Lake Purdy Dam investigations which are in process by Staff and Arcadis at a
cost of $3,000,000 each. Sonny Jones stated Alabama is the only state who does not have a Dam
Safety Act. And lastly, the Inland Lake well project which is under construction to install
pumps, pads, fences and control panel at a cost of $1,100,000. Moving on to System
Development Department’s main replacement projects, the total number of feet of main replaced
in July 2014 is 24,339. The Northern Beltline with the Carson Loop project will pick up and
increase in the System Development department. Under construction currently is 6,710 feet.
Under Distribution highlights, the total of leak orders completed July 2014 is 579 with 15
outstanding leak orders. The date of the oldest leak in the system is July 10, 2014. The number
of hydrants repaired or replaced July 2014 is 122. The average out-of-service time is one-day
according to Sonny Jones. Photographs of the progress at Western Filter Plant were shown to
the Board. Director Munchus asked what the driver is on the Dam Safety Act. Sonny Jones
stated it was in the legislature at this time. Some discussion took place on possible drivers.
Following, Sonny Jones provided a handout to the Board (a copy is on file with the
Board’s minutes). Sonny Jones stated when members of Staff and the Board were in Ontario,
Canada for a conference, a water station was observed. Darryl Jones researched the water
dispensing unit and found a clean, filtered, mobile event water station. Sonny Jones stated the
unit can be connected to a fire hydrant for unlimited water or use a holding tank which would be
the preferred method. Mac Underwood stated this was already being manufactured and that
Staff would look into the purchase and cost. Binnie Myles stated Tampa, Florida was the closest
state where the unit could be purchased. Some discussion took place on getting the specs to
build a unit in house. The Board recommended Staff investigate the mobile water dispensing
unit further.
Next, Assistant General Manager Darryl Jones was recognized to present the Operations
and Technical Services Division report for July 2014 in a PowerPoint presentation as set forth in
agenda item 3. Darryl Jones reported on the finished and raw water pumpage for July 2014. The
total finished water pumped compared to previous years shows an increase. There is an increase
in raw water, but not as high as in previous Julys. Around the 17th, 18th and 19th of the month we
had some electrical issues at Mulberry Intake causing the facility to be taken down and some of
the load was transferred to the Sipsey system. Rainfall looks good with plenty of water at Inland
Lake and Lake Purdy as well. The same 30-day period compared to last year shows increased
pumpage which will make August 2014 look good financially. Mac Underwood pointed out that
the Board has to maintain the assets as if we are using them every day. The month of July shows
an increase in industrial customers’ usage. Some discussion took place on customers making
conservation efforts. A comparison of power and chemical costs was made with actual power
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costs for July 2014 of $873,471 and actual chemical costs of $454,957. Staff will be fine tuning
the chemical budget in 2015 according to Darryl Jones.
Following, Darryl Jones presented item 4, for information, on the refurbishing and
reconditioning of Sipsey Pump Station’s number 2 pump and motor. Darryl Jones explained that
the existing pump was built in 1958 and came online in 1962. The Sipsey Pump Station provides
critical raw water to the system and the no. 2 Byron Jackson pump has failed due to damaged
impellers, shaft warpage and excessive bushing wear. In addition, the no. 2 Allis Chalmers 1750
HP motor has failed due to excessive wear of internal components. The cone valve associated
with the pump and motor needs to be refurbished or replaced as well. These pumps have a 20 to
30 year life span according to Darryl Jones. The cost to rebuild the motor is $175,000 versus
$500,000 to purchase a new one. The cost to rebuild the pump is $346,705 versus $657,505 to
purchase a new one. Staff recommended rebuilding the pump and motor as the rebuild process
would be near new at its completion. The Board approved Staff to move forward with their
plans to have the pump and motor at Sipsey Pump Station rebuilt.
Next, Mac Underwood provided a document (a copy is on file with the Board’s minutes)
titled “Birmingham Water Works Board Effective Utility Management 2013 Accomplishments.”
Mr. Underwood stated he had challenged the managers to be more positive and the document on
the Board’s 2013 accomplishments was a great place to be reminded of the positive facts about
the Birmingham Water Works. Mac Underwood challenged the assistant general managers and
the Board to have a positive attitude about the company. Mac said each manager should be able
to quickly name five positive things about their department. Some discussion took place on the
high volume of calls the customer service department handles. Sonny Jones added as he was
leaving campus this week, one of the leak crews was headed back in and one of the crew
members yelled to him that they “got four today”, referring to the number of leaks they had
worked.
Following, the General Manager asked the Board to enter into an Executive Session.
Subsequently, Board Attorney Mark Parnell indicated the purpose of the Executive Session was
to discuss two pending lawsuits. Attorney Parnell stated Director Florie would need to abstain
for the surface mining issue. Attorney Parnell stated the session should take about 20 minutes
and that no action was expected to be taken. On a motion duly made and seconded, the
following resolution was adopted:
“BE IT RESOLVED By the Water Works Board of the City of Birmingham (“the
Board”), on a motion duly made by Mr. George Munchus and seconded by Ms. Ann D. Florie,
that the Board hereby approves an Executive Session to discuss two pending lawsuits.
Resolution No. 6738 is hereby adopted by unanimous vote on August 22, 2014.”
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At 1:37 p.m., the directors, senior executive management and the Board’s attorneys
entered into an Executive Session.
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At 2:12 p.m. a motion was made and seconded to reopen the meeting. As there was no
further business before the Board, a motion was duly made and seconded, and the meeting was
adjourned.
______________/S/___________________
A. Jackie Robinson, III
Chairman/President
Attest:
____________/S/____________________
David S. Herring
Secretary-Treasurer
Minutes of August 22, 2014
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