To: Board of Directors
From: Blackhawk Geological Hazard Abatement District
Report Title: Blackhawk GHAD Resolution No. 2025/01 and Resolution No. 2025/02
☒Recommendation of the County Administrator ☐ Recommendation of Board Committee
RECOMMENDATIONS:
ADOPT Blackhawk Geological Hazard Abatement District (GHAD) Resolution No. 2025/01 adopting the GHAD budget for 2025/2026 fiscal year, updating GHAD Manager payment limit under Consulting Services Agreement and acknowledging an increase in the GHAD General Manager annual payment limit for FY 2024/2025.
ADOPT Blackhawk GHAD Resolution No. 2025/02 approving the change of GHAD Treasurer from CLT Management, LLC to Laffer Tengler Investments (“LTI”) and approve a contract of services between LTI and Blackhawk GHAD.
FISCAL IMPACT:
The GHAD is funded 100% through a portion of the property tax levied on properties within the GHAD.
BACKGROUND:
On April 22, 1986, the Contra Costa County Board of Supervisors adopted Resolution 86/210 approving the formation of the Blackhawk Geologic Hazard Abatement District ("GHAD") and appointed itself to serve as the GHAD Board of Directors (“GHAD Board”). The GHAD includes a GHAD General Manager (Sands Construction), GHAD Clerk/Attorney (Fennemore LLP) and a GHAD Treasurer (CLE) all appointed by the Board.
1. Annual Budget, Payment Limit for FY 2024/2025 and Report on Unanticipated Expenditures (Resolution 2025/01). The GHAD Board adopts a budget for the GHAD operations each fiscal year. The GHAD Board is being requested to adopt the fiscal year budget for 2025/2026 as prepared by the GHAD General Manager which is attached to Resolution No. 2025/01. The proposed fiscal year budget is $3,965,000.
In addition, the GHAD Board is being requested to update the GHAD Manager payment limits under the existing Consulting Services Agreement as required by that Agreement. The budget attached to Resolution No. 2025/01 identifies that payment limit at $810,000.
The 2024/2025 budget projected the GHAD Manager annual payment limit of $695,000 as shown in GHAD Resolution No. 2024/01. This amount has increased due to the need to complete projects and tasks that were not anticipated in preparing the FY 2024/2025 budget. An additional $100,000 is needed for the GHAD Manager to finish the necessary projects. The following projects/tasks caused the increase in the annual limit as projected in the FY 2024/2025 budget:
a. Q1 - Blackhawk Executive Center went an extra 3-weeks in duration. Project Management budget was exceeded by approximately 30%.
b. Q2 - FEMA - The intensive work with CalOES was not anticipate and required significant resources and detail to respond to CalOES requests for documents, data, and interviews to be included in the GHAD appeal.
c. Q2 - Kingswood Place - a landslide that occurred during the 2022/23 Rain Event was temporarily stabilized in Spring 2023 but reactivated in late 2024 Q1. Emergency repair designs and repair efforts were needed to re-stabilize the slide mass and protect the property above that was threatened.
d. Q2-Q3-Q4 - There were several unexpected claims received that took, and will continue to take, added resources to process/defend.
The contract for services between the GHAD General Manager and GHAD (approved by Resolution No. 2023/03 on June 13, 2023), requires the GHAD General Manager to inform the Board of any unanticipated increases in the payment limit. Resolution No. 2025/01 acknowledges this increase in the annual payment limit for FY 2024/2025.
2. Appointment of Change in Name of GHAD Treasurer (Resolution 2025/02). The GHAD Board is also being asked to approve a change in the designation of the GHAD Treasurer from CLT Management, LLC to Laffer Tengler Investments (“LTI”). On June 16, 2020, with Resolution 2020/02, the GHAD Board of Directors appointed CLT Management as GHAD Treasurer. CLT Management has been dissolved. Both CLT Management and LTI were functioning as wholly owned corporations within Butcher Joseph & Co with independent tax ID numbers (TIN). With the dissolution of CLT Management, we ask for approval to transfer the role of GHAD Treasurer from CLT Management to LTI. As was performed under CLT Management, investment management services will continue to be delivered by Laffer Tengler Investments; Laffer Tengler Investments has retained an independent accounting firm to provide accounting and bill payment services for the GHAD as required under the agreement for Professional Services.
Personnel acting in the capacity of LTI will remain the same as under CLT Management. If approved, the GHAD Treasurer will complete actions necessary to change treasurer functions from CLT Management to LTI.
A form contract of services between LTI and Blackhawk GHAD is attached to Resolution No. 2025/02. The GHAD Board is being asked to approve the contract as to form and direct the GHAD General Manager to finalize and execute the contract.
CONSEQUENCE OF NEGATIVE ACTION:
The GHAD will not be able to continue to operate starting July 1, 2025 if the budget is not approved.
If the Board does not approve the change in designation of the GHAD Treasurer from CLT Management to LTI, staff requests the Board provide direction on a new Treasurer as the GHAD is required by GHAD Law to have a Treasurer.