Draft Minutes of the March 28, 2019 Meeting of the Citizens’ Bond Oversight Committee

March 28, 2019
4:30 pm
District Office Conference Room

I. Call to Order
The meeting was called to order at 4:40 pm. 

II. Establishment of Quorum
A quorum was established.  In attendance: Chair Grier Graff, Vice Chair Julie Caskey, members Adam Christiansen, Kim Dao, Jonathan Levine, Melissa Wilk; PUSD Board members Megan Pillsbury and Amal Smith; and PUSD staff Pete Palmer, Ruth Alahydoian, and Julie Moll.  (Members Andy Hempeck and Kyung-Hee Howard were absent.)

III. Public Comment
None.

The Committee made an adjustment to the order of agenda items. 

IV. Review and Discussion of Independent Audit Reports  

• Jill Stenton, Senior Manager of Vavrinek, Trine, Day and Co., the District’s independent auditor, presented the bond program audits for 2017-18.   In the finance audit, VDT determined that the District used appropriate accounting practices and that assets, liabilities, revenue, and expenses were fairly stated.  VDT made no negative findings. In the performance audit, VDT determined that all bond fund expenditures were consistent with the bond measure language. VDT reviewed 82% of the expenditures for the 2017-18 year with particular attention to salaries, to ensure that bond funds were not used to pay General Fund expenses.  Ms. Stenton noted that VDT had initially questioned the use of bond funds to pay for training for a consultant, but ultimately determined that the training was specific to the Measure H1 projects and not information the consultant would otherwise be expected to have. VDT made no negative findings, but cautioned the District to err on the side of caution when using bond funds.  In the future, as the volume of expenses increases, VDT will not review such a high percentage of expenditures, but the audit will never encompass less than 30% of expenditures during the audit period.
• Committee member Melissa Wilk reported that she and Andy Hempeck reviewed the accounts payable process.  Specifically, they reviewed a sample of purchase orders for 2017-18 and 2018-19, following each invoice through to check distribution.  They determined that “All information verified and accurate through the Accounts Payable process.” Their summary is attached.  

V. Report on Measure H1 Budget

Chief Financial Officer Ruth Alahydoian presented a bond finance report as follows.  

In summary, of the $66 million authorized by voters, $26 million has been issued. The remaining $40 million in bonds will be sold in one tranche based on projected cash demand.  A total of $3.68 million was expended during 2017-18. So far in 2018-19, $1.94 million has been expended.  

VI. Report on Measure H1 Program and Projects

Measure H1 Program Manager Pete Palmer provided the following updates: 

• California’s Division of State Architect (DSA) is expected to issue the permit for the STEAM building by April 1.  
• The District is on schedule to begin demolition on April 13 and hopes to complete this work by April 21 (the end of Spring Break).  The District is also on schedule to begin construction on June 1.
• The District removed the PHS trellis to make it possible to begin underground utilities work June 1.  
• Abatement and removal of hazardous materials in Alan Harvey Theater is nearly complete.  The District’s environmental hygienist will provide “air clearances” to confirm there are no detectable hazardous materials in the building.  The hygienist will also provide a letter confirming that abatement and removal has been completed and the building is ready for demolition.  
• Witter Field turf repair and replacement will be completed over the next few days, and is expected to extend the useful life of the field turf for another year at a cost of roughly $30,000.

Mr. Palmer also reported that, during value engineering, the District pared $1.1 million from STEAM project budget and $400,000 from the performing arts building/theater budget.   

VII. Review, Discussion and Possible Approval of Second Annual Report to the Community  

Committee Chairperson Grier Graff reviewed the draft report and members provided comments and suggested changes.  The Committee authorized Mr. Graff to collect and incorporate comments and finalize the report for submission to the Board of Education by April 5.  All members who are available are encouraged to attend the April 10 Board of Education meeting, when the report will be presented to the Board and community.  

VIII. Approval of December 13, 2018 Minutes 

Moved: Melissa Wilk.  Seconded: Adam Christiansen.  Vote: Approved.

IX. Future Agenda Items

None.

X. Adjournment

The meeting adjourned at 6:02.   The next CBOC meeting will be on June 27, 2019 at 4:30 in the District Office Conference Room.