Response to Grand Jury Recommendations

July 27, 2005 Antonio Medrano, Foreperson
Grand Jury of Contra Costa County
725 Court Street
P.O. Box 911
Martinez, CA 94553-0091

Dear Mr. Medrano:

The Board of Directors of the Bethel Island Municipal Improvement District would like to take this opportunity to thank the members of the grand jury who conducted the investigation into the conduct of BIMID business. We appreciate the time your members spent attending our board meetings and discussing our work with various directors, our employees, county and state agencies and members of the public.

You will note from our responses, that the board generally agreed with all of your findings and recommendations. We will be implementing them as soon as we are able. We appreciate your recognition that our funding is limited, and less than predictable.

Our responses to your report are attached.

Sincerely,

Dan Phippen, President
Bethel Island Municipal Improvement District

The following are the Bethel Island Municipal Improvement District (BIMID) Board of Directors responses to the Grand Jury Report No. 0507 Findings and Recommendations.

FINDINGS

Levee

Should a levee fail, and the island flood, 2300 residents will be affected, with substantial damage to property as well as potential loss of life.
The respondent agrees with the finding.

Bethel Island is one of eight islands in the west Delta, which are particularly critical to protecting Delta water quality because they are adjacent to a major Delta channel where fresh and salt-water mix.
The respondent agrees with the finding.

In the 1980’s, the Federal Emergency Management Agency (“FEMA”) adopted a minimum standard that requires levees to be, among other requirements, one foot higher than flood stage and required reclamation districts, such as BIMID, to meet minimum levee standards.
The respondent agrees with the finding.

Reclamation districts had until 1991 to comply with the requirements or be ineligible for federal disaster assistance.
The respondent agrees with the finding.

BIMID did not meet that 1991 FEMA deadline.
The respondent agrees with the finding. BIMID filed a request for an extension with FEMA, which FEMA lost. The appeal was located in the State Office of Emergency Services with a timely date stamp. It has been resubmitted to FEMA but no response from FEMA has been received.

FEMA turned down requests from BIMID for disaster assistance funds for emergency work performed by BIMID following the 1995, 1997, and 1998 winter storm disasters because BIMID had not met the 1991 deadline.
The respondent agrees with the finding. BIMID filed a request for an extension with FEMA, which FEMA lost. The appeal was located in the State Office of Emergency Services with a timely date stamp. It has been resubmitted to FEMA but no response from FEMA has been received.

BIMID continues to upgrade the levee, and recently concluded that the levee is now compliant with FEMA standards. However, BIMID has not documented its position to FEMA in an attempt to be formally recognized as eligible for federal disaster funds.
The respondent agrees with the finding. BIMID cannot document to FEMA. It needs to be documented to DWR, which BIMID is in the process of doing.

Over the past decade, BIMID has requested assistance from elected state and federal representatives in finding a solution to the FEMA compliance issue. The assistance involves these representatives intervening on BIMID’s behalf with FEMA and other involved agencies.
The respondent agrees with the finding.

CALFED is a partnership of federal and state agencies responsible for managing the region’s water supplies and improving the quality of the San Francisco Bay-Delta habitat. Its 2000 “Levee System Integrity Program Plan” recommends that reclamation districts bring their levees up to a base level of protection, known as the Public Law 84-99 (“PL 84-99”) standard.
The respondent agrees with the finding.

CALFED does not have funds to support its “Levee System Integrity Program.”
The respondent partially agrees with the finding. BIMID is currently receiving money. There is legislation in process to get two bills passed to replace the “Levee System Integrity Program” so funding can continue.

PL 84-99 sets a standard higher than FEMA’s standard and suggests levees be 1.5 feet above flood stage, as well as setting greater width and slope standards.
The respondent partially agrees with the finding. The width is the same, 16 feet.

Sections of the levee do not meet the PL 84-99 standards and it will take several years, requiring additional funding, for BIMID to bring the entire levee to those standards.
The respondent partially agrees with the finding. BIMID can meet height and width standard (profile) in the near future. The safety factor of 1.25 needs to be re-evaluated.

Currently, funding for levee maintenance and rehabilitation comes from property taxes and money provided by Proposition 50, “Water Security, Clean Drinking Water, Coastal and Beach Protection Act of 2002,” which is due to run out in 2006.
The respondent partially agrees with the finding. BIMID is currently receiving money. There is legislation in process to get two bills passed to replace the “Levee System Integrity Program” so funding can continue.

BIMID does not have a plan to finance levee maintenance once Proposition 50 funding runs out.
The respondent partially agrees with the finding. A draft report has been prepared by a BIMID consultant and BIMID attorney. Work is being done to determine alternate funding.

A number of engineering studies, authorized and funded by BIMID, have been conducted in recent years on the levee. A suggestion was made at BIMID Board meetings on July 15, 2004 and September 16, 2004 to review these studies, evaluate conditions, develop a priority list, and cost the work.
The respondent agrees with the finding.

Water

Water for Bethel Island is currently provided by wells that are operated by individual property owners and about 30 private water companies.
The respondent agrees with the finding.

Some Bethel Island wells do not meet current and proposed DHS minimum contamination level standards for manganese and total dissolved solids.
The respondent agrees with the finding. BIMID does not have data on the private wells as it is not in our jurisdiction.

There are no fire hydrants outside of the commercial area on Bethel Island.
The respondent agrees with the finding.

The Local Agency Formation Commission (“LAFCO”) was petitioned (“LAFCO Petition”) to designate Diablo Water as the supplier of Delta Coves.
The respondent agrees with the finding

BIMID appealed the LAFCO Petition.
The respondent agrees with the finding.

The LAFCO Petition was approved after BIMID and Delta Coves entered into a written agreement as follows: The developer of Delta Coves agreed to pay BIMID $250,000 to drill test wells to determine if BIMID could find water in adequate quantity and quality to supply a proposed BIMID water treatment facility and distribution system.

If the test wells identify an adequate water supply that is certified by DHS, the developer of Delta Coves agreed to pay BIMID an additional $2,000,000 towards the design and construction of a water treatment facility.

BIMID agreed to withdraw its appeal of the LAFCO Petition.

The respondent agrees with the finding. BIMID requested a re-hearing. The matter was settled prior to the re-hearing and BIMID withdrew the appeal at that hearing.

The two primary options for replacing most private wells on Bethel Island are:

Water from a new Bethel Island water treatment facility (“Bethel Island Option”).

Water from Diablo Water (“Diablo Water Option”).

The respondent agrees with the finding, but there are other options.

No comparative study exists for the above options that includes: Advantages/disadvantages of each option.

Adequacy of flow to provide service to the island including fire suppression.

The quality of water to be provided.

The infrastructure needed, including capital and operating costs.

User connection and usage costs.

Financing options for infrastructure costs and for individual connection fees.

Emergency backup requirements and source(s).

The respondent agrees with the finding. Work has been done. No “detailed” comparative study exists.

Other

BIMID has adopted ordinance numbers 4 and 9 to protect emergency levee access, to protect the drainage systems, and to regulate activities upon, through, or over the levee system.
The respondent agrees with the finding.

BIMID has seldom taken action to enforce ordinances regarding locked levee access gates, residents’ requirements to clean out drainage ditches and boxes, and the planting of vegetation on the levee.
The respondent partially agrees with the finding. BIMID does attempt to get residents to comply. We need to be more aggressive.
30. Enforcement actions available include levying fines, charging residents for work done by BIMID, and attaching property liens if owners fail to pay fines or charges.
The respondent partially agrees with the finding. This may require amending and strengthening ordinances.

Section 34 of the Bethel Island Municipal Improvement District Act states, “The board shall act only by ordinance, resolution, motion, or contract.”
The respondent agrees with the finding.

BIMID received a $50,000 donation from a developer, other than the developer of Delta Coves, to commission a feasibility study and business plan for the Bethel Island Option water treatment facility.
The respondent agrees with the finding.

There is no written contract between BIMID and the provider of the $50,000, nor is there a resolution or motion in meeting minutes to accept the money.
The respondent agrees with the finding. A written agreement was submitted to the developer by the BIMID attorney. The developer chose not to sign the agreement, indicating the money was a gift to explore the formation of a water company. The gift was received in increments at the developer’s discretion, and was used for the purpose intended. There was discussion at board meetings regarding the use of the money, but apparently not a motion to accept it.

RECOMMENDATIONS

The 2004-2005 Contra Costa County Grand Jury recommends that BIMID:
Levee

Develop a long-range plan (“Levee Plan”) by December 31, 2005 to upgrade the island levee to at least the standards set forth in Public Law 84-99. This plan could use prior engineering studies and should prioritize levee maintenance and rehabilitation tasks, estimate their costs, and include funding sources.
The recommendation has not yet been implemented, but will be implemented in the future. A workshop has been scheduled for August 16th, 2005 to discuss and set a long range plan. Cost estimates and long range funding will probably not be identified until fiscal year 2006-2007.

Determine funds available for implementing the Levee Plan. Implement the plan to the extent of those funds.
The recommendation has not yet been implemented, but will be implemented in the future. Recommendation #1 must be completed prior to completion of Recommendation #2.

If funding is not available to complete the Levee Plan, evaluate alternatives for local funding such as a parcel tax, bond issue, or benefit assessment district.
The recommendation has not yet been implemented, but will be implemented in the future, following completion of Recommendations #1 and #2.

Update the community annually as to the progress in meeting the Levee Plan.
The recommendation has not yet been implemented, but will be implemented in the future. The community update will be timed immediately after signing of DWR work agreement contracts each year. The information will appear on the BIMID web site, www.bimid.com. The Municipal Advisory Council newsletter will also continue to be used.

Provide a letter to FEMA, documenting BIMID’s position that the Bethel Island levee is now in compliance and requesting agreement that BIMID is now eligible for federal disaster funds.
The recommendation has not yet been implemented, but will be implemented in the future. The information has been provided to the State Office of Emergency Services which will assist BIMID to receive an inspection from the Department of Water Resources. A request for inspection will also be sent to the Army Corp of Engineers.

Continue to work with elected federal and state representatives to find a solution to the FEMA compliance issue.
The recommendation has been implemented.

Water

Negotiate a revision to the agreement, immediately, with the developer of Delta Coves so that the $2,000,000 is not restricted solely to develop a water treatment facility, but can be used for other purposes that benefit the entire community, such as levee maintenance or installation of water mains servicing the entire island.
The recommendation has not yet been implemented, but will be implemented in the future. The BIMID Board authorized that negotiation at the July 21, 2005 meeting.

Prepare and make public a comprehensive study of the Bethel Island Option (defined in Finding 27). Include in that study a comparison to the Diablo Water Option and the status quo. Funding for the study could come from the $2,000,000 provided by Delta Coves.
The recommendation has not yet been implemented, but will be implemented in the future. The $2 million is not available for this purpose. This information must be presented to LAFCO along with BIMID’s request to exercise it’s latent powers to become a public water provider. The BIMID board voted to proceed with the LAFCO application process at the July 21, 2005 meeting.

Conduct a series of public meetings whereby residents may direct comments and questions to the BIMID Board of Directors regarding the proposed water system options.
The recommendation has been implemented. BIMID has regular monthly meetings.

If BIMID selects the Bethel Island Option, establish a reciprocal agreement with Diablo Water to interconnect the water systems and provide back up should there be an interruption of service.
The recommendation requires further analysis.

Other

Communicate with property owners and residents regarding their responsibility, BIMID’s responsibility, and BIMID’s enforcement authority for the levee and drainage systems, as outlined in BIMID ordinances 4 and 9.
The recommendation has not yet been implemented, but will be implemented in the future. Modifications of Ordinance 9 is being considered by BIMID engineers and the BIMID attorney at this time.

Make regular use of BIMID’s enforcement authority under ordinances 4 and 9, including fines, assessments, and liens.
The recommendation has not yet been implemented, but will be implemented in the future. Ordinances 4 and 9 must be modified prior to enforcement. The BIMID attorney states BIMID may have to request the state amend the BIMID Enabling Act, which could take considerable time.

Adopt a written policy regarding the acceptance of contributions that requires written agreements and full disclosure of such contributions.
The recommendation was implemented at the July 21, 2005 board meeting.