| Chairman McNutt called the meeting to order.
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| Trustees Present: |
Absent: |
Don McNutt, Chairman
James Ford, Vice Chairman
Tom Kolb
Danny Opie
Melvin Schebaum
Dan Schuette
|
John Albert
Henry Herschel
Gary O'Neal
Tom Pfeiffer
Bruce Work |
| Staff Present: |
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Carol R. Eighmey, Executive Director
Diane Wallace, Executive Assistant
Tim Duggan, Assistant Attorney General
Bob Clarke, Operations Manager, Williams & Company Consulting, Inc
Pat Eriksen, Vice President, Williams & Company Consulting, Inc
Dan Henry, Claims Coordinator Supervisor, Williams & Company Consulting, Inc
Jeff Humenik, Claims Supervisor, Williams & Company Consulting, Inc
Pat Vuchetich, General Claims Manager, Williams & Company Consulting, Inc
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| Others Present: |
Doyle Childers, Director, Department of Natural Resources
Ron Hooker, Former PSTIF Trustee
Carol Kather, U.S. EPA – Region 7
Kerry Kaullen, Department of Agriculture, Division of Weights and Measures
Ken Koon, DNR/HWP, Tanks Section Chief
Sarah Madden, Attorney General's Office
Stan Walker, U.S. EPA – Region 7
Glen Young, DNR, Division of Geology and Land Survey |
Claim Appeal – Musselman and Hall, Claim 50575
Ms. Eighmey noted that Musselman and Hall representatives have requested that the Board postpone consideration of their claim appeal, as they have decided they have some reservations about the settlement offer.
Approval of Minutes– July 19, 2006 Meeting
Dan Schuette moved that the minutes from the July 19, 2006 Board meeting be approved as written. Tom Kolb seconded.
Motion carried.
Monthly Reports
and Decision on Funding New Remedial Claims
Chairman McNutt invited the Trustees to review the monthly reports.
Dan Schuette moved that the Board release funding for the three new remedial claims. Tom Kolb seconded. Motion carried.
Report on Triad Approach to Cleanups
Chairman McNutt introduced Pat Eriksen , who introduced Jeff Humenik from Williams & Company Consulting, Inc. Mr. Humenik gave a presentation on what the Triad approach is and how it is being used to expedite cleanup of three tank sites. He reviewed how the approach integrates decision making by the owner, his consultant, the DNR, and the PSTIF.
Trustees responded with affirmation and interest, and requested a progress report at a future meeting. Ms. Eighmey and Ken Koon noted that they expect to apply lessons learned from these three sites to other tank site cleanups.
Annual Report on Insured UST Losses
Chairman McNutt asked Ms. Eighmey to summarize this report for the Board. She noted that the PSTIF continues to experience very low claim frequency from its insured USTs, and that because leaks are being detected sooner, cleanup costs for new releases are lower than the Fund's average claim cost. It was noted that the number of tank removal projects occurring each year also has declined.
Cash Flow Projection
Chairman McNutt introduced Pat Eriksen to present the semi-annual cash flow projection. Mr. Eriksen compared actual experience with recent projections, noting that claim pay-outs continue to occur more slowly than anticipated and, with the recent rise in interest rates generating income on a larger cash balance, the Fund's financial situation has improved significantly. He pointed out that this is the first time in nine years that the projection anticipates revenues will be sufficient to cover all current and future claims. However, he emphasized that an increase in claims by insured tank owners and/or owners of eligible, out-of-use tank sites could dramatically change the projection.
There was discussion about why the PSTIF is not receiving more claims for cleanup of out-of-use tank sites, and Mr. Eriksen indicated that the study recently undertaken at the direction of the Board is nearly complete and will be presented at the next Board meeting. Ms. Eighmey mentioned she intends to have discussion with the Advisory Committee at its upcoming meeting about the Fund's finances and whether the transport load fee should be lowered.
A copy of Mr. Eriksen's presentation is filed with these minutes.**
Action on FY08 Budget Requests
Chairman McNutt announced that he had appointed Jim Ford, Tom Kolb, and Bruce Work to review FY08 budget requests from the Attorney General's Office and the Department of Natural Resources. The following requests were then reviewed and discussed:
Attorney General's Office – Jim Ford noted the AGO had requested an increase in funding to support its ongoing efforts to enforce the FR requirement, and distributed a memorandum from the subcommittee, which is attached hereto.** He moved that the Board approve the request from the Attorney General's Office totaling approximately $97,948, with the understanding that the Governor or Legislature may increase the figure via a cost-of-living adjustment, (COLA). Tom Kolb seconded. Motion carried.
Department of Revenue – Tom Kolb moved that the Board approve the request from the Department of Revenue totaling approximately $38,373, with the understanding that the Governor or Legislature may add a COLA to the figure. Jim Ford seconded. Motion carried.
Office of Administration – Melvin Schebaum made a motion to approve the request from the Office of Administration totaling $123,459 for “central state services.” Dan Schuette seconded. Motion carried.
Department of Natural Resources – Jim Ford distributed a memorandum, attached hereto,** recommending approval of the same amount for FY08 as the Board approved for FY07, with an additional 4% added for the FY07 COLA. He moved that the Board approve a total of $1,111,884, with the understanding that the Governor or Legislature may add a COLA to the figure. Tom Kolb seconded the motion.
Discussion followed. Jim Ford commented DNR had requested additional funds for implementing the UST provisions of the 2005 Federal Energy Act, but it was not clear that the additional expenditures would relate to the PSTIF's statutory obligations. Dan Schuette responded that during the 2006 legislative session, Ron Leone from MPCA had requested the Board's support for a bill designed to implement one of the Energy Act requirements; he noted he had opposed the request since he thought it was premature. Ms. Eighmey noted that the Board had voted to support the bill, SB1020, because it would benefit the PSTIF and its participants. Mr. Schuette said that since the Board had voted to support that bill, he had assumed the Board would also support DNR's funding request related to the Federal Energy Act. Tom Kolb clarified that SB1020, enacted by the state legislature, requires manufacturers and installers to have pollution liability insurance, and asked Mr. Schuette if he is requesting additional funds from the PSTIF to implement that bill. Mr. Schuette said that the Department's funding request was its estimate of the total amount of money that might be needed, if DNR had to implement all provisions of the Energy Act simultaneously, although he noted that EPA has not yet issued final guidance on what states will be required or requested to do. He indicated he would be willing to work with the Board to phase in the additional expenditures. Ken Koon added that DNR staff will communicate with EPA as it implements the various provisions of the new federal law, and hopes there may be some additional funding from EPA in the future to help DNR respond to the new federal requirements, but that is still uncertain. Chairman McNutt suggested it may be appropriate for the PSTIF to pay to implement some of the new federal requirements, but there are likely others that are unrelated to the PSTIF's statutory responsibilities and therefore the Board would be unable to fund them. He suggested that until specifics are known, it is premature for the Board to make this decision.
Ken Koon announced a series of meetings are planned to inform people what the Federal Energy Act says; he confirmed that the first of the deadlines in the federal law is February 2007 and that SB1020 addressed that requirement. Ms. Eighmey noted that PSTIF participants are very interested in what the Department's plans are for implementing the “delivery prohibition provision,” and invited DNR staff to share those plans at Advisory Committee and/or Board meetings.
Jim Ford and Tom Kolb offered to meet with Dan Schuette to get further information or clarification regarding the Department's plans and request for additional funding related to the Federal Energy Act; they amended their motion to indicate they would meet with Dan and may then bring an additional recommendation to the Board at its November meeting.
Chairman McNutt called for a vote on the motion. Trustees voting in favor were: Jim Ford, Tom Kolb, Don McNutt, Danny Opie, and Melvin Schebaum. Voting against was Dan Schuette.
Petroleum Storage Tank Insurance Fund Board of Trustees – Jim Ford moved that the Board submit FY08 appropriations requests to the Governor that are identical to its FY07 appropriations. Melvin Schebaum seconded. Motion carried.
Administrative Issues
Update on Proposed Rule Amendments – Ms. Eighmey informed the Board that, to date, she had been unable to carry out the Board's directive to publish proposed amendments to its regulations, as the Secretary of State's office is requiring a transmittal letter or delegation of signatory authority from the Department of Natural Resources, and the DNR has so far refused to provide such. She reported that Tim Duggan is working with DNR's counsel to resolve the impasse.
Status Report – FY06 Audit – Chairman McNutt noted the FY06 PSTIF Audit was underway by Graves and Associates.
Report on Implementation of New “Underwriting” Requirements – Ms. Eighmey commented on the letter recently sent to insured UST owners and operators, announcing changes to some of the Fund's procedures for obtaining and renewing coverage. She said the PSTIF office had received a few phone calls from insureds with questions about the new procedures, but there have been no serious complaints.
Board Meeting Dates for 2007 – Chairman McNutt asked if any Trustees had conflicts with the meeting dates proposed for 2007. Dan Schuette asked if the July 25 meeting could be changed to July 18, 2007; the other Trustees agreed. There being no other conflicts, Dan Schuette moved to approve the proposed Board Meeting dates for 2007 with this change. Jim Ford seconded. Motion carried.
Next Board Meeting – Chairman McNutt announced that the next meeting of the Board of Trustees would be at The University Club in the T.O. Wright Conference Room, on the University of Missouri Campus on November 29.
Billings – Chairman McNutt called the Trustees' attention to the recent bills in their notebooks.
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. Dan Schuette seconded. Motion carried.
**For a copy of the presentation mentioned in these minutes, please contact the PSTIF Office. Please note, if presentation(s) are in electronic format, they will be sent to you as an email attachment per your request. However, as some presentations may be in hard copy only, please provide your mailing address at the time of your email request.
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