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| Trustees Present: |
Absent: |
Don McNutt, Chairman
Jim Ford, Vice Chairman
John Albert
Mark Kaiser
Tom Kolb
Ski Mariea
Danny Opie
Melvin Schebaum
Bruce Work |
Tom Pfeiffer
Dan Schuette |
| Staff Present: |
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Bob Clarke, Operations Manager, Williams & Company Consulting, Inc.
Tim Duggan, Attorney General's Office
Carol R. Eighmey, Executive Director
Pat Eriksen, President, Williams & Company Consulting, Inc.
Dan Henry, Williams & Company Consulting, Inc.
Diane James, Executive Assistant
Pat Vuchetich, General Claims Manager, Williams & Company Consulting, Inc.
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| Others Present: |
Kerry Kaullen, Petroleum Program Administrator,
Division of Weights and Measures, Department of Agriculture
Ron Leone, Executive Director, MPCA
Sarah Madden, Attorney General’s Office |
Claim Appeal – Former Sinclair, Claim 62507
Chairman McNutt briefly reviewed the information provided to Trustees in their meeting materials and asked if there were any questions. There were none.
Tom Kolb moved to approve an additional payment of $21,156.44 to settle the claim appeal. Bruce Work seconded. Motion carried.
Approval of Minutes – July 23, 2008
Ski Mariea moved that the minutes from the July 23, 2008 Board meeting be approved. Melvin Schebaum seconded. Motion carried.
Monthly Reports
Chairman McNutt invited questions or comments about the monthly reports.
Cash Flow Projection
Chairman McNutt introduced Pat Eriksen from Williams & Co. to present the most recent cash flow projection information. Mr. Eriksen showed several slides and discussed the Fund’s claims history and projections, including the impact from large loss claims, (>$250,000). A copy of his presentation is attached hereto.
Discussion followed. There were comments about the paucity of remedial claims filed in recent months, and about the fact that the PSTIF insures a significant number of sites where the equipment is old and will likely be taken out of service in the near future, which will generate more insurance claims. Mr. Eriksen clarified that, due to the uncertainty of attempting to project long-term costs, his projection only goes to FY21; he noted that under current law, the Fund would incur additional costs after that date since Fund participants have until December 31, 2020 to file claims.
Report on UST Losses in FY08
Chairman McNutt invited Ms. Eighmey to discuss the claims filed by insured UST owners and operators during FY08. Ms. Eighmey showed pictures taken by Williams & Company’s claims adjusters for the seven claims filed during FY08 where there were “identifiable leaks” from insured USTs.
FY10 Budget Requests
Chairman McNutt noted that Tom Pfeiffer, Bruce Work and Melvin Schebaum had served as a committee to review each agency’s budget request for FY10, which were in the Trustees’ meeting notebooks, and asked for their report. Melvin Schebaum noted that the budget committee’s discussions were held via conference call, then presented the committee’s recommendations:
Department of Revenue – Melvin Schebaum moved that the Board approve the request from the Department of Revenue for funding to support one FTE. He said that with an estimated cost-of-living adjustment, (COLA), of 3% and fringe benefits estimated at 48%, the Department of Revenue’s request would total approximately $42,156. Tom Kolb seconded. Motion carried.
Attorney General’s Office – Melvin Schebaum moved that the Board approve the request from the AGO for $25,108, plus COLA and fringe benefit costs. He estimated that with a COLA of 3% and fringe benefits estimated at 48%, the AGO’s request would total approximately $38,275. John Albert seconded. Motion carried.
Office of Administration – Melvin Schebaum moved that the Board approve the request from the Office of Administration for $127,371 to pay for “central state services” in FY10. He reminded Trustees that this includes costs for the Governor, Lt. Governor, State Treasurer and General Assembly. Ski Mariea seconded. Motion carried.
Petroleum Storage Tank Insurance Fund – Melvin Schebaum moved that the Board request the same two appropriations for FY10 as were enacted for FY09. He noted one is for staff and operating expenses; with an estimated COLA of 3% and fringe benefits, it would total approximately $2,391,171. The other is for claim payments, claims processing costs and refunds; at an estimated appropriation of $20,000,000. Tom Kolb seconded. Motion carried.
Department of Natural Resources – Melvin Schebaum moved that the Board postpone action on the DNR’s request until such time as the Department provides a work plan detailing how much total funding from all sources is available for tanks work, how that funding will be used, what will be accomplished with the PSTIF money, when risk-based corrective action rules will be published, and what is the plan to accelerate the pace of cleanups. Tom Kolb seconded. A brief discussion ensued. Bruce Work mentioned that the committee was unanimous in its recommendation, and that they had discussed the need for a “zero-based budgeting” type of explanation, in which the DNR explains how all dollars requested from the PSTIF will be used. Ms. Eighmey noted she had requested additional information from DNR regarding its FY10 request and had informed Mr. Schuette the previous day what the committee would be recommending at Board meeting. Jim Ford asked whether the “administration” mentioned in Mr. Schuette’s letter includes any of the Board’s costs for its own staff or operations; Ms. Eighmey said it does not. Motion carried.
A copy of the committee’s report is attached hereto.
Advisory Committee Recommendation – RBCA Rules
Chairman McNutt then introduced Ron Leone, Executive Director of MPCA, to discuss a recommendation from the Advisory Committee contained in a memorandum provided in the Trustees’ meeting materials.
Mr. Leone gave a brief history of statutory and regulatory changes concerning risk-based corrective action, (RBCA), noting that the goal of RBCA is to do cleanups more quickly and economically. He opined that the concept is sound but the implementation has not achieved those goals. He explained that DNR’s “RBCA requirements” for tank sites were initially issued in early 2004 in a draft guidance document, after two years of meetings with the regulated community. He said the draft guidelines have since been modified several times, and pointed out that guidelines are not rules and can give rise to inconsistent interpretations by different staff. He commented that the regulated community wants DNR to implement the 2004 Guidance in rules, and noted that the memo from the Advisory Committee indicates that the industry does not feel like it is “getting a fair shake.” He reiterated the Advisory Committee’s recommendation that the Board hire an expert to write an alternate set of rules, using primarily the DNR’s 2004 Guidance Document, for consideration by the Hazardous Waste Management Commission.
Jim Ford moved that the Board approve the Committee’s recommendation to hire an expert to write an alternate set of risk-based corrective action rules which could then be presented to the Hazardous Waste Management Commission. John Albert seconded. Discussion ensued, during which it was clarified that the Board cannot spend more than $25,000 without issuing a formal RFP through OA’s Division of Purchasing. Motion carried.
Administrative Issues
Record Retention Schedule – Ms. Eighmey reminded Trustees that Williams and Company and the PSTIF are running out of storage space for files, and that she and Diane James have been working with the staff in the Secretary of State’s Office to finalize a record retention schedule for the PSTIF’s files. She noted the schedule provided in the Trustees’ materials was a draft; a more recent version was distributed and is attached hereto. She noted the schedule may undergo additional changes, but the most important feature she wanted the Trustees to understand is that the PSTIF’s claim files and underwriting files will be destroyed after a certain period, probably 35-45 years. She said she was still working to evaluate options for converting the Board’s records to digital storage.
Ski Mariea moved to authorize staff to finalize the schedule with the Secretary of State’s office. Danny Opie seconded. Motion carried.
Training for Consultants – Chairman McNutt noted the information provided was informational only and asked if there were any questions or comments. There were none.
FR for ASTs – There were no questions or concerns about the information presented in the notebook.
Dates for 2009 Board Meetings – Chairman McNutt asked Trustees to mark their calendars for 2009 with the approved Board meeting dates provided. Ms. Eighmey said Dan Schuette had inquired about rescheduling the next Board meeting from November 19 to November 20 so that he could attend. Several Trustees had conflicts with the alternate date, so Chairman McNutt announced the November 19 date would remain.
Billings – Chairman McNutt asked Trustees if they had any questions or comments on the billing information provided. There were none.
Jim Ford moved that the Board go into closed session to discuss and vote on matters related to legal actions, causes of action, litigation and/or personnel issues pursuant to Section 610.021, RSMo. Tom Kolb seconded. Motion carried.
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