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Home My WebLink About2003-07-02 SAlll ORANGE COUNTY SANITATION DISTRICT June 26, 2003 90 r Per/hC THE N\fie``` phone: (714)962-2411 fax: (7141962-0356 NOTICE OF ADJOURNED REGULAR MEETING www.o csd.corn mailing address: P.O. Box 8127 Fountain Valley,CA 92728-6127 street address: BOARD OF DIRECTORS ue Fou44 untanllValy,is nCA ORANGE COUNTY SANITATION DISTRICT 92708-7018 Member Agencies WEDNESDAY, JULY 2, 2003 — 5:30 P.M. • Cities Anaheim DISTRICT'S ADMINISTRATIVE OFFICES Brea 10844 Ellis Avenue Buena Park Cypress Fountain Valley, California 92708 Fountain Valley Fullerton Garden Grove Huntington Beach Irvine La Habra The Adjourned Regular Meeting of the Board of Directors of the Orange County La Palma Los Alamitos Sanitation District will be held at the above location, time and date. Newport Beach Orange Placentia I Santa Ana Seal Beach Stanton Tustin Bo d Secret Villa Park Yorba Linda County of Orange Sanitary Districts Costa Mesa Midway City Water Districts Irvine Ranch To maintain world-class leadership in wastewater and water resource management. AGENDA BOARD OF DIRECTORS ORANGE COUNTY SANITATION DISTRICT DISTRICT'S ADMINISTRATIVE OFFICES 10844 ELLIS AVENUE FOUNTAIN VALLEY, CA 92708 ADJOURNED REGULAR MEETING July 2, 2003 — 5:30 P.M. In accordance with the requirements of California Government Code Section 54954.2, this agenda has been posted in the main lobby of the District's Administrative Offices not less than 72 hours prior to the meeting date and time above. All written materials relating to each agenda item are available for public inspection in the office of the Board Secretary. In the event any matter not listed on this agenda is proposed to be submitted to the Board for discussion and/or action, it will be done in compliance with Section 54954.2(b) as an emergency item, or that there is a need to take immediate action which need came to the attention of the District subsequent to the posting of the agenda, or as set forth on a supplemental agenda posted not less than 72 hours prior to the meeting date. All current agendas and meeting minutes are also available via Orange County Sanitation's Internet site located at www.ocsd.com. Upon entering the District's web site, please navigate to the Board of Directors section. 1. Invocation and Pledge of Allegiance 2. Roll Call 3. Consideration of motion to receive and file minute excerpts of member agencies relating to appointment of Directors, if any. (See listing in Board Meeting folders) 4. Appointment of Chair pro tem, if necessary 5. The Chair, General Manager and General Counsel present verbal reports on miscellaneous matters of general interest to the Directors. These reports are for information only and require no action by the Directors. a. Report of Chair; consideration of Resolutions or commendations, presentations and awards b. Report of General Manager C. Report of General Counsel 07/02/03 Page 2 CONSENT CALENDAR All matters placed on the Consent Calendar are considered as not requiring discussion or further explanation and unless any particular item is requested to be removed from the Consent Calendar by a Director, staff member or member of the public in attendance, there will be no separate discussion of these items. All items on the Consent Calendar will be enacted by one action approving all motions, and casting a unanimous ballot for resolutions included on the consent calendar. All items removed from the Consent Calendar shall be considered in the regular order of business. Members of the public who wish to remove an item from the Consent Calendar shall, upon recognition by the Chair, state their name, address and designate by number the item to be removed from the Consent Calendar. The Chair will determine if any items are to be deleted from the Consent Calendar. 6. Consideration of motion to approve all agenda items appearing on the Consent Calendar not specifically removed from same, as follows: a. Motion to read all Ordinances by title only, and waive reading of entire Ordinances. (The waiver of the reading of entire ordinances must be adopted by a unanimous vote of Directors present.) END OF CONSENT CALENDAR 7. Consideration of items deleted from Consent Calendar, if any. NON-CONSENT CALENDAR 8. Continuation of consideration to adopt proposed Ordinance No. OCSD-20, An Ordinance of the Board of Directors of Orange County Sanitation District, Adopting Revised Sanitary Sewer Service Charges; Reaffirming Established Capital Facilities Capacity Charges; Reaffirming Established Miscellaneous Charges and Fees Relating to Industrial Dischargers, Source Control Permittees and Wastehaulers; and Repealing Ordinance Nos. OCSD-18 and OCSD-19: a. Open meeting 1. Receive and file written comments, if any 2. Verbal reports of staff 3. Directors' questions 4. Public comments 07/02/03 Page 3 b. Close meeting C. Discussion by Board of Directors d. Recommended actions: 1. Motion to adopt Ordinance No. OCSD-20, An Ordinance of the Board of Directors of Orange County Sanitation District, Adopting Revised Sanitary Sewer Service Charges; Reaffirming Established Capital Facilities Capacity Charges; Reaffirming Established Miscellaneous Charges and Fees Relating to Industrial Dischargers, Source Control Permittees and Wastehaulers; and Repealing Ordinance Nos. OCSD-18 and OCSD-19: (Must be approved by a 2/3 vote of the entire Board of Directors or, in the alternative, to consider introduction of a modified fee ordinance.) 9. Adopt Resolution No. OCSD 03-13, Directing the County Tax Collector to Include Sanitary Sewer Service Charges on Fiscal Years 2003/04 through 2007/08 Property Tax Bills, and Repealing Resolution No. OCSD 02-10. 10. Direct staff to evaluate, as follows, and report back to the Board of Directors at a future date but no later than May 2004: 1. Evaluate a water usage-based or other methodology-based user fee program for residential users; 2. The user fee structure for condominiums vs. that associated with the single family residential rate (SFR) and the multi-family residential rates (MFR); and, 3. The legal and policy implications of establishing a low-income user fee subsidy program. 11. Public Comments: All persons wishing to address the Board on specific agenda items or matters of general interest, except those comments in regard to Item 8, should do so at this time. As determined by the Chair, speakers may be limited to three minutes. Matters of interest addressed by a member of the public and not listed on this agenda cannot have action taken by the Board of Directors except as authorized by Section 54954.2(b). 12. CLOSED SESSION: During the course of conducting the business set forth on this agenda as a regular meeting of the Board, the Chair may convene the Board in closed session to consider matters of pending real estate negotiations, pending or potential litigation, or personnel matters, pursuant to Government Code Sections 54956.8, 54956.9, 54957 or 54957.6, as noted. Reports relating to (a) purchase and sale of real property, (b) matters of pending or potential litigation; (c) employment actions or negotiations with employee representatives, or which are exempt from public disclosure under the California Public Records Act, may be reviewed by the Board during a permitted closed session and are not available for public inspection. At such time as the Board takes final action on any of these subjects, the minutes will reflect all required disclosures of information. 07/02/03 Page 4 a. Convene in closed session, if necessary 1. Confer with General Counsel - Potential Litigation. Initiation of Litigation pursuant to Government Code Section 54956.9(c): One (1) potential matter. b. Reconvene in regular session C. Consideration of action, if any, on matters considered in closed session 13. Matters which a Director may wish to place on a future agenda for action and staff report. 14. Other business and communications or supplemental agenda items, if any 15. Future Meeting Date: The next Board of Directors regular meeting is scheduled for July 23, 2003, at 7:00 p.m. 16. Adjournments .............................................................................................................................................................................................................__...-......................................................... NOTICE TO DIRECTORS: To place items on the agenda for the Regular Meeting of the Board of :Directors, items shall be submitted to the Board Secretary no later than the close of business 14 days :preceding the Board meeting. The Board Secretary shall include on the agenda all items submitted by :Directors, the General Manager and General Counsel and all formal communications. :General Manager Blake Anderson (714) 593-7110 banderson(a)ocsd.com ::Board Secretary Penny Kyle (714) 593-7130 pkyle(a.ocsd.com Director/Engineering David Ludwin (714) 593-7300 dludwin _ocsd.com Director/Finance/Treasurer Gary Streed (714) 593-7550 gstreedPocsd.com :Director/Human Resources Lisa Tomko (714) 593-7145 Itomko(a)ocsd.com Director/Information Technology Patrick Miles (714) 593-7280 smiles a@ocsd.com Director/Operations& Maintenance Bob Ooten (714) 593-7020 rooten(@ocsd.com iDirectorlTechnical Services Bob Ghirelli (714) 593-7400 rghirelli(a)ocsd.com :Administrative Services Mgr. Greg Mathews (714) 593-7104 gmathews(aDocsd.com :Communications Services Mgr. Carol Beekman (714) 593-7120 cbeekman(aDocsd.com General Counsel Thomas L. Woodruff 714 564 2605 tlw wss law.com ........................................................................................................................................................(.........).............................. � n ..................._...................... In compliance with the Americans with Disabilities Act, if you need special assistance to participate in this meeting, please contact the Board Secretary's office at (714) 593-7130 at least 48 hours prior to the meeting to allow the District to make reasonable arrangements to ensure accessibility to this meeting. GAwp.dta\agenda\Board Agendas\2003 Board Agendas\062503 agenda.doc REQUEST TO ADDRESS THE BOARD OF DIRECTORS re Proposed Ordinance No. OCSD-20 All persons wishing to address the Board on proposed Ordinance No. OCSD-20 should complete and submit this form to the Board Secretary prior to commencement of the Board meeting. As determined by the Chair, speakers may be deferred until the specific item is taken for discussion. Remarks may be limited to three minutes or less. Any handouts (35 COPIES REQUIRED) must be given to the Board Secretary prior to the meeting for distribution. At this hearing, we will have the following procedure relative to persons addressing the Board. The Board received comments from many members of the public at its June 25th meeting. At tonight's public hearing, the Board will receive comments from persons who spoke at the June 25th hearing, only to the extent that their comments were not previously offered at the June 25th hearing. The Board will also receive comments from any new speaker who did not speak at the June 25th hearing. Persons who offered comments on June 25th and simply want to repeat those comments are not to present those comments again tonight. The Board Members already have that information in mind. PLEASE NOTE: Those persons who did not speak on June 25t" will be provided the opportunity to speak first. DATE: July 2, 2003 AGENDA ITEM NO. 8 NAME: (please print) HOME ADDRESS: (number/street) Aa h e,,' . ('/V 9-2,fo Y (city/zip code)' TELEPHONE: 1D -7 9 / REPRESENTING: 26S /rs CC;�� (self/name of ganization) I 4r aw Ae- REQUEST TO ADDRESS THE BOARD OF DIRECTORS re Proposed Ordinance No. OCSD-20 All persons wishing to address the Board on proposed Ordinance No. OCSD-20 should complete and submit this form to the Board Secretary prior to commencement of the Board meeting. As determined by the Chair, speakers may be deferred until the specific item is taken for discussion. Remarks may be limited to three minutes or less. Any handouts (35 COPIES REQUIRED) must be given to the Board Secretary prior to the meeting for distribution. At this hearing, we will have the following procedure relative to persons addressing the Board. The Board received comments from many members of the public at its June 25th meeting. At tonight's public hearing, the Board will receive comments from persons who spoke at the June 25th hearing, only to the extent that their comments were not previously offered at the June 25th hearing. The Board will also receive comments from any new speaker who did not speak at the June 25th hearing. Persons who offered comments on June 25th and simply want to repeat those comments are not to present those comments again tonight. The Board Members already have that information in mind. PLEASE NOTE: Those persons who did not speak on June 25th will be provided the opportunity to speak first. DATE: July 2, 2003 AGENDA ITEM NO. 8 NAME: (please print) r�--�? ✓1 I �oc�th , HOME ADDRESS: / l c C'= z-- (number/street) '7� (city/zip code) T TELEPHONE: 6 REPRESENTING: Vlc�lr61� (self/name of organization) 1,A1 REQUEST TO ADDRESS THE BOARD OF DIRECTORS re Proposed Ordinance No. OCSD-20 All persons wishing to address the Board on proposed Ordinance No. OCSD-20 should complete and submit this form to the Board Secretary prior to commencement of the Board meeting. As determined by the Chair, speakers may be deferred until the specific item is taken for discussion. Remarks may be limited to three minutes or less. Any handouts (35 COPIES REQUIRED) must be given to the Board Secretary prior to the meeting for distribution. At this hearing, we will have the following procedure relative to persons addressing the Board. The Board received comments from many members of the public at its June 25th meeting. At tonight's public hearing, the Board will receive comments from persons who spoke at the June 25th hearing, only to the extent that their comments were not previously offered at the June 25th hearing. The Board will also receive comments from any new speaker who did not speak at the June 25th hearing. Persons who offered comments on June 25th and simply want to repeat those comments are not to present those comments again tonight. The Board Members already have that information in mind. PLEASE NOTE: Those persons who did not speak on June 25t" will be provided the opportunity to speak first. DATE: July 2, 2003 AGENDA ITEM NO. 8 NAME: (please print) I ` � / 1 V t( HOME ADDRESS: (number/street) C�_ (city/ ip code)) —7 TELEPHONE: REPRESENTING: (self/name of organization) �� , ��r�' �. July 2, 2003 Board of Directors, OCSD The Board of Directors has approved spending over$2.3 Billion for maintaining and improving OCSD. This money has to come from somewhere. Approved paying$50 Million over five years for Program Management to IPMC Approved the Capital Improvement Program with over$1.1 Billion in rehab and upgrade Approved GWRS for over$250 Million Approved expanding secondary treatment for GWRS and total 2' aprox $400 M Approved Cooperative Projects Approved repairing and upgrading the Collections System Where is the money going to come from to pay for these as well as operating the system? Borrow? Use reserves? Increase user fees? Borrowing can allow the CIP to occur,but overall costs will increase since the money borrowed must be paid back with interest. The interest rate may be low now,but the money is not free. Before the end of this decade, we will be paying more in interest and principal payments than the cost to run the operation. Debt service$109M, 0&M $10IM in 2009-10. Even if the user fee is increased by$1-2/month over the next five years, the users still will have over$1.4 Billion in debt to pay back in 2012. By 2013 the principal payments will only have paid $342M while at the same time having paid$520M in interest. Reserves keep the system from floundering in the event of a disaster. OCSD is self insured to a great extent. The reserves keep the rates from increasing by more than $25/year by making interest on the money and not having to borrow more money. The reserves are less than 20% of the total CIP. Spending the reserves would do more harm than good. People can afford increasing their sewer user fees by$1-2/month. This is not onerous. This is not frivolous. This is not even the cost of one gallon of gasoline. This money has to be paid to maintain the world-class sewage system for which Orange County is rightly proud. Do not allow the system to become decrepit where leaks and breaks will destroy the integrity of the system and will cost us dearly in public approval as well as fines for regulatory problems. Approve the ordinance to set the user fee increase at 15% for the next five years. As a director, you must decide what is best for this organization as well as for your constituents. You control the destiny of OCSD. Sincerely, Randy T. Fuhrman 16915 Roundhill Drive Huntington Beach, CA 92649 (714) 377-4487 REQUEST TO ADDRESS THE BOARD OF DIRECTORS re Proposed Ordinance No. OCSD-20 All persons wishing to address the Board on proposed Ordinance No. OCSD-20 should complete and submit this form to the Board Secretary prior to commencement of the Board meeting. As determined by the Chair, speakers may be deferred until the specific item is taken-for discussion. Remarks may be limited to three minutes or less. Any handouts (35 COPIES REQUIRED) must be given to the Board Secretary prior to the meeting for distribution. At this hearing, we will have the following procedure relative to persons addressing the Board. The Board received comments from many members of the public at its June 25th meeting. At tonight's public hearing, the Board will receive comments from persons who spoke at the June 25th hearing, only to the extent that their comments were not previously offered at the June 25th hearing. The Board will also receive comments from any new speaker who did not speak at the June 25th hearing. Persons who offered comments on June 25th and simply want to repeat those comments are not to present those comments again tonight. The Board Members already have that information in mind. PLEASE NOTE: Those persons who did not speak on June 25th will be provided the opportunity to speak first. DATE: July 2, 2003 AGENDA ITEM NO. 8 NAME: (please print) HOME ADDRESS: I `7 (number/street) (city/zip code) v TELEPHONE: 9 iz 3 REPRESENTING: Crkt�cti I L_ck_ GO_ (self/name of organization) �,� �(,�'�iZt-�v �� , �� ,d�-mac,ee, 6•�' %-T��;:ee�v�- �- • • � `` . � REQUEST TO ADDRESS THE BOARD OF DIRECTORS re Proposed Ordinance No. OCSD-20 All persons wishing to address the Board on proposed Ordinance No. OCSD-20 should complete and submit this form to the Board Secretary prior to commencement of the Board meeting. As determined by the Chair, speakers may be deferred until the specific item is taken for discussion. Remarks may be limited to three minutes or less. Any handouts (35 COPIES REQUIRED) must be given to the Board Secretary prior to the meeting for distribution. At this hearing, we will have the following procedure relative to persons addressing the Board. The Board received comments from many members of the public at its June 25th meeting. At tonight's public hearing, the Board will receive comments from persons who spoke at the June 25th hearing, only to the extent that their comments were not previously offered at the June 25th hearing. The Board will also receive comments from any new speaker who did not speak at the June 25th hearing. Persons who offered comments on June 25th and simply want to repeat those comments are not to present those comments again tonight. The Board Members already have that information in mind. PLEASE NOTE: Those persons who did not speak on June 25t" will be provided the opportunity to speak first. DATE: July 2, 2003 AGENDA ITEM NO. 8 NAME: (please print) HOME ADDRESS: (number/street) 6��V L)�e v (city/zip code) TELEPHONE: �) REPRESENTING: (self/name of organization) I / i �� s � ,, �� REQUEST TO ADDRESS THE BOARD OF DIRECTORS re Proposed Ordinance No. OCSD-20 All persons wishing to address the Board on proposed Ordinance No. OCSD-20 should complete and submit this form to the Board Secretary prior to commencement of the Board meeting. As determined by the Chair, speakers may be deferred until the specific item is taken for discussion. Remarks may be limited to three minutes or less. Any handouts (35 COPIES REQUIRED) must be given to the Board Secretary prior to the meeting for distribution. At this hearing, we will have the following procedure relative to persons addressing the Board. The Board received comments from many members of the public at its June 25th meeting. At tonight's public hearing, the Board will receive comments from persons who spoke at the June 25th hearing, only to the extent that their comments were not previously offered at the June 25th hearing. The Board will also receive comments from any new speaker who did not speak at the June 25th hearing. Persons who offered comments on June 25th and simply want to repeat those comments are not to present those comments again tonight. The Board Members already have that information in mind. PLEASE NOTE: Those persons who did not speak on June 25th will be provided the opportunity to speak first. DATE: July 2, 2003 AGENDA ITEM NO. 8 NAME: (please � �- �`� 6t e- P print) HOME ADDRESS: l (number/street) Q (4 -,nZL (city/zip code) TELEPHONE: REPRESENTING: (self/name of organization) - r ` S REQUEST TO ADDRESS THE BOARD OF DIRECTORS re Proposed Ordinance No. OCSD-20 All persons wishing to address the Board on proposed Ordinance No. OCSD-20 should complete and submit this form to the Board Secretary prior to commencement of the Board meeting. As determined by the Chair, speakers may be deferred until the specific item is taken for discussion. Remarks may be limited to three minutes or less. Any handouts (35 COPIES REQUIRED) must be given to the Board Secretary prior to the meeting for distribution. At this hearing, we will have the following procedure relative to persons addressing the Board. The Board received comments from many members of the public at its June 25th meeting. At tonight's public hearing, the Board will receive comments from persons who spoke at the June 25th hearing, only to the extent that their comments were not previously offered at the June 25th hearing. The Board will also receive comments from any new speaker who did not speak at the June 25th hearing. Persons who offered comments on June 25th and simply want to repeat those comments are not to present those comments again tonight. The Board Members already have that information in mind. PLEASE NOTE: Those persons who did not speak on June 25t" will be provided the opportunity to speak first. DATE: July 2. 2003 AGENDA ITEM NO. 8 NAME: (please print) HOME ADDRESS: (number/street) (city/zip code) (� TELEPHONE: (7 REPRESENTING: ` 1- (self/name of organization) �/V41 ` REQUEST TO ADDRESS THE BOARD OF DIRECTORS re Proposed Ordinance No. OCSD-20 All persons wishing to address the Board on proposed Ordinance No. OCSD-20 should complete and submit this form to the Board Secretary prior to commencement of the Board meeting. As determined by the Chair, speakers may be deferred until the specific item is taken for discussion. Remarks may be limited to three minutes or less. Any handouts (35 COPIES REQUIRED) must be given to the Board Secretary prior to the meeting for distribution. At this hearing, we will have the following procedure relative to persons addressing the Board. The Board received comments from many members of the public at its June 25th meeting. At tonight's public hearing, the Board will receive comments from persons who spoke at the June 25th hearing, only to the extent that their comments were not previously offered at the June 25th hearing. The Board will also receive comments from any new speaker who did not speak at the June 25th hearing. Persons who offered comments on June 25th and simply want to repeat those comments are not to present those comments again tonight. The Board Members already have that information in mind. PLEASE NOTE: Those persons who did not speak on June 25t" will be provided the opportunity to speak first. DATE: July 2, 2003 AGENDA ITEM NO. 8 NAME: (please print) HOME ADDRESS: �.1� � �_. ��5> C�rS1 (/c- (number/street) (city/zip code) TELEPHONE: 5 l REPRESENTING: L f= (self/name of organization) f � :� �r S REQUEST TO ADDRESS THE BOARD OF DIRECTORS re Proposed Ordinance No. OCSD-20 All persons wishing to address the Board on proposed Ordinance No. OCSD-20 should complete and submit this form to the Board Secretary prior to commencement of the Board meeting. As determined by the Chair, speakers may be deferred until the specific item is taken for discussion. Remarks may be limited to three minutes or less. Any handouts (35 COPIES REQUIRED) must be given to the Board Secretary prior to the meeting for distribution. At this hearing, we will have the following procedure relative to persons addressing the Board. The Board received comments from many members of the public at its June 25th meeting. At tonight's public hearing, the Board will receive comments from persons who spoke at the June 25th hearing, only to the extent that their comments were not previously offered at the June 25th hearing. The Board will also receive comments from any new speaker who did not speak at the June 25th hearing. Persons who offered comments on June 25th and simply want to repeat those comments are not to present those comments again tonight. The Board Members already have that information in mind. PLEASE NOTE: Those persons who did not speak on June 25t" will be provided the opportunity to speak first. DATE: July 2. 2003 AGENDA ITEM NO. 8 NAME: (please print) re c l✓- �1 HOME ADDRESS: (number/street) r'�V�` •►M C q Z ESL (city/zip code) 1 TELEPHONE: U REPRESENTING: S L-1 (self/name of organization) j� '/ J �`r'_J r � � � . �� ► ,,:��' r 1 REQUEST TO ADDRESS THE BOARD OF DIRECTORS re Proposed Ordinance No. OCSD-20 All persons wishing to address the Board on proposed Ordinance No. OCSD-20 should complete and submit this form to the Board Secretary prior to commencement of the Board meeting. As determined by the Chair, speakers may be deferred until the specific item is taken for discussion. Remarks may be limited to three minutes or less. Any handouts (35 COPIES REQUIRED) must be given to the Board Secretary prior to the meeting for distribution. At this hearing, we will have the following procedure relative to persons addressing the Board. The Board received comments from many members of the public at its June 25th meeting. At tonight's public hearing, the Board will receive comments from persons who spoke at the June 25th hearing, only to the extent that their comments were not previously offered at the June 25th hearing. The Board will also receive comments from any new speaker who did not speak at the June 25th hearing. Persons who offered comments on June 25th and simply want to repeat those comments are not to present those comments again tonight. The Board Members already have that information in mind. PLEASE NOTE: Those persons who did not speak on June 25th will be provided the opportunity to speak first. DATE: July 2, 2003 AGENDA ITEM NO. 8 i NAME: (please print) HOME ADDRESS: � �'`^�I (number/street) Q (city/zip code) 7 TELEPHONE: I( 14) REPRESENTING: (self/name of organization) mop -As oil, AS WOOF,- REQUEST TO ADDRESS THE BOARD OF DIRECTORS re Proposed Ordinance No. OCSD-20 All persons wishing to address the Board on proposed Ordinance No. OCSD-20 should complete and submit this form to the Board Secretary prior to commencement of the Board meeting. As determined by the Chair, speakers may be deferred until the specific item is taken for discussion. Remarks may be limited to three minutes or less. Any handouts (35 COPIES REQUIRED) must be given to the Board Secretary prior to the meeting for distribution. At this hearing, we will have the following procedure relative to persons addressing the Board. The Board received comments from many members of the public at its June 25th meeting. At tonight's public hearing, the Board will receive comments from persons who spoke at the June 25th hearing, only to the extent that their comments were not previously offered at the June 25th hearing. The Board will also receive comments from any new speaker who did not speak at the June 25th hearing. Persons who offered comments on June 25th and simply want to repeat those comments are not to present those comments again tonight. The Board Members already have that information in mind. PLEASE NOTE: Those persons who did not speak on June 25t" will be provided the opportunity to speak first. DATE: July 2. 2003 AGENDA ITEM NO. 8 NAME: (please print) y� HOME ADDRESS: (number/street) (city/zip code) l TELEPHONE: (7111) U REPRESENTING: (self/name of organization) 'T REQUEST TO ADDRESS THE BOARD OF DIRECTORS re Proposed Ordinance No. OCSD-20 All persons wishing to address the Board on proposed Ordinance No. OCSD-20 should complete and submit this form to the Board Secretary prior to commencement of the Board meeting. As determined by the Chair, speakers may be deferred until the specific item is taken for discussion. Remarks may be limited to three minutes or less. Any handouts (35 COPIES REQUIRED) must be given to the Board Secretary prior to the meeting for distribution. At this hearing, we will have the following procedure relative to persons addressing the Board. The Board received comments from many members of the public at its June 25th meeting. At tonight's public hearing, the Board will receive comments from persons who spoke at the June 25th hearing, only to the extent that their comments were not previously offered at the June 25th hearing. The Board will also receive comments from any new speaker who did not speak at the June 25th hearing. Persons who offered comments on June 25th and simply want to repeat those comments are not to present those comments again tonight. The Board Members already have that information in mind. PLEASE NOTE: Those persons who did not speak on June 25th will be provided the opportunity to speak first. DATE: July 2. 2003 AGENDA ITEM NO. 8 NAME: (please print) HOME ADDRESS: I �� L� B acdy f J )(2�-t (number/street) (city/zip code) TELEPHONE: REPRESENTING: (self/name of organization) 2 j t) Xe, 2W Sr� 4v-o )tz Yoffie J'Lo MIAJ. 37 .10 t 40 s REQUEST TO ADDRESS THE BOARD OF DIRECTORS re Proposed Ordinance No. OCSD-20 All persons wishing to address the Board on proposed Ordinance No. OCSD-20 should complete and submit this form to the Board Secretary prior to commencement of the Board meeting. As determined by the Chair, speakers may be deferred until the specific item is taken for discussion. Remarks may be limited to three minutes or less. Any handouts (35 COPIES REQUIRED) must be given to the Board Secretary prior to the meeting for distribution. At this hearing, we will have the following procedure relative to persons addressing the Board. The Board received comments from many members of the public at its June 25th meeting. At tonight's public hearing, the Board will receive comments from persons who spoke at the June 25th hearing, only to the extent that their comments were not previously offered at the June 25th hearing. The Board will also receive comments from any new speaker who did not speak at the June 25th hearing. Persons who offered comments on June 25th and simply want to repeat those comments are not to present those comments again tonight. The Board Members already have that information in mind. PLEASE NOTE: Those persons who did not speak on June 25t" will be provided the opportunity to speak first. DATE: July 2. 2003 AGENDA ITEM NO. 8 * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * NAME: (please print) �f C��R C- HOME ADDRESS: (number/street) (city/zip code) TELEPHONE: �) REPRESENTING: ---�:t ci (self/name of organization) NOW � l�� , � � �� REQUEST TO ADDRESS THE BOARD OF DIRECTORS re Proposed Ordinance No. OCSD-20 All persons wishing to address the Board on proposed Ordinance No. OCSD-20 should complete and submit this form to the Board Secretary prior to commencement of the Board meeting. As determined by the Chair, speakers may be deferred until the specific item is taken for discussion. Remarks may be limited to three minutes or less. Any handouts (35 COPIES REQUIRED) must be given to the Board Secretary prior to the meeting for distribution. At this hearing, we will have the following procedure relative to persons addressing the Board. The Board received comments from many members of the public at its June 25th meeting. At tonight's public hearing, the Board will receive comments from persons who spoke at the June 25th hearing, only to the extent that their comments were not previously offered at the June 25th hearing. The Board will also receive comments from any new speaker who did not speak at the June 25th hearing. Persons who offered comments on June 25th and simply want to repeat those comments are not to present those comments again tonight. The Board Members already have that information in mind. PLEASE NOTE: Those persons who did not speak on June 25th will be provided the opportunity to speak first. DATE: July 2, 2003 AGENDA ITEM NO. 8 NAME: (please print) V ' /\-/C) Il U HOME ADDRESS: (number/street) j020 �vV�rt� (city/zip code) TELEPHONE: REPRESENTING: (self/name of organization) � �� -� �� s �'� �� , �� . REQUEST TO ADDRESS THE BOARD OF DIRECTORS re Proposed Ordinance No. OCSD-20 All persons wishing to address the Board on proposed Ordinance No. OCSD-20 should complete and submit this form to the Board Secretary prior to commencement of the Board meeting. As determined by the Chair, speakers may be deferred until the specific item is taken for discussion. Remarks may be limited to three minutes or less. Any handouts (35 COPIES REQUIRED) must be given to the Board Secretary prior to the meeting for distribution. At this hearing, we will have the following procedure relative to persons addressing the Board. The Board received comments from many members of the public at its June 25th meeting. At tonight's public hearing, the Board will receive comments from persons who spoke at the June 25th hearing, only to the extent that their comments were not previously offered at the June 25th hearing. The Board will also receive comments from any new speaker who did not speak at the June 25th hearing. Persons who offered comments on June 25th and simply want to repeat those comments are not to present those comments again tonight. The Board Members already have that information in mind. PLEASE NOTE: Those person� ho did not speak on June 25th will be provided the opportunity to Sp ak' first. DATE: July 2. 2003 AGENDA ITEM NO. 8 NAME: (please print) ' �� HOME ADDRESS: /V (number/street) NA- (city/zip code) �I TELEPHONE: REPRESENTING: (self/name of organization) �-�- �s � �,° �.,� ��. ! 7 � �pT�s � � �► �� - �� J �� ,y �. t s� REQUEST TO ADDRESS THE BOARD OF DIRECTORS re Proposed Ordinance No. OCSD-20 All persons wishing to address the Board on proposed Ordinance No. OCSD-20 should complete and submit this form to the Board Secretary prior to commencement of the Board meeting. As determined by the Chair, speakers may be deferred until the specific item is taken for discussion. Remarks may be limited to three minutes or less. Any handouts (35 COPIES REQUIRED) must be given to the Board Secretary prior to the meeting for distribution. At this hearing, we will have the following procedure relative to persons addressing the Board. The Board received comments from many members of the public at its June 25th meeting. At tonight's public hearing, the Board will receive comments from persons who spoke at the June 25th hearing, only to the extent that their comments were not previously offered at the June 25th hearing. The Board will also receive comments from any new speaker who did not speak at the June 25th hearing. Persons who offered comments on June 25th and simply want to repeat those comments are not to present those comments again tonight. The Board Members already have that information in mind. PLEASE NOTE: Those persons who did not speak on June 25th will be provided the opportunity to speak first. DATE: July 2. 2003 AGENDA ITEM NO. 8 NAME: (please print) HOME ADDRESS: (number/street) (city/zip code) TELEPHONE: - , REPRESENTING: (self/name of organization) C�'� mac-�- _ � � �_� .�r • �� ' � �� REQUEST TO ADDRESS THE BOARD OF DIRECTORS re Proposed Ordinance No. OCSD-20 All persons wishing to address the Board on proposed Ordinance No. OCSD-20 should complete and submit this form to the Board Secretary prior to commencement of the Board meeting. As determined by the Chair, speakers may be deferred until the specific item is taken for discussion. Remarks may be limited to three minutes or less. Any handouts (35 COPIES REQUIRED) must be given to the Board Secretary prior to the meeting for distribution. At this hearing, we will have the following procedure relative to persons addressing the Board. The Board received comments from many members of the public at its June 25th meeting. At tonight's public hearing, the Board will receive comments from persons who spoke at the June 25th hearing, only to the extent that their comments were not previously offered at the June 25th hearing. The Board will also receive comments from any new speaker who did not speak at the June 25th hearing. Persons who offered comments on June 25th and simply want to repeat those comments are not to present those comments again tonight. The Board Members already have that information in mind. PLEASE NOTE: Those persons who did not speak on June 25th will be provided the opportunity to speak first. DATE: July 2. 2003 AGENDA ITEM NO. 8 NAME: (please print) ► V!' 1 �s L HOME ADDRESS: G > ? I C0 (number/street) (city/zip code) TELEPHONE: ( Sys' REPRESENTING: C�C (self/name of organization) '04 Kyle, Penny From: webmaster@ocsd.com Sent: Thursday, July 03, 2003 12:02 PM Subject: Orange County Sanitation District Board Passes Ordinance to Approve 15% Rate Increase FOR IMMEDIATE RELEASE PRESS RELEASE#06032003 Subject :Orange County Sanitation District Board Passes Ordinance to Approve 15% Rate Increase Vote Includes Condition of 2/3 Majority Approval for Each of Next Four Years Contact :Carol Beekman 714.593.7120 FOUNTAIN VALLEY, Calif., July 3,2003—At the July 2 meeting of the Orange County Sanitation District, the Board of Directors voted to approve an approximate 15 percent increase for each of the next five years. The rate increase was approved with a condition to reaffirm each year's rate increase with a two thirds vote(17 of 25 votes)versus a simple majority(13 of 25 votes)of the Board. The rate increase will be included in the 2003-04 property tax bills. The first year increase will raise a single family residence fee from the current rate of$87.50 per year to$100. Blake Anderson, General Manager of the Orange County Sanitation District said, "With this decision,we npw have a fully integrated approach for facing the next decade."The increase in fees will cover costs of chemicals, managing biosolids, maintaining clean beaches, moving to full secondary treatment, funding water reclamation projects and replacing aging infrastructure. The Orange County Sanitation District is responsible for safely collecting, treating, and disposing wastewater. It is a special district, separate from the County of Orange or any city government, established under the California Health and Safety Code,to provide sewerage service to a specific geographic area. The Orange County Sanitation District is governed by a 25-member board of directors comprised of representatives of each local sewering agency or cities within its 470-square- mile service area. For more information, visit OCSD's website at www.ocsd.com. 1 This is a continuation of the Public Hearing from June 25, 2003. The Board of Directors has authority, and has adopted its Rules of Procedure for Conduct of Meetings. The Board will hear all interested parties, but with a 3-minute time limit. The Board will hear first from those persons who have not previously addressed the Board. The Board will hear from those who addressed the Board on June 251h, but ONLY if there is new information to be presented. At the conclusion of all testimony, the Chair will likely close the public hearing. This will constitute the required public hearing for adopting increased fees, regardless of what rates and what duration is finally acted upon by the Board. There is presently an Ordinance that has been introduced and given the 1s' of two required readings. If a motion is made to adopt that Ordinance and it receives 17 affirmative votes, it will pass and be the new schedule of rates. Alternatively, if a motion is made to amend or revise that Ordinance regarding either amount of the fees or the duration of years, that revised Ordinance, if passed, will be the 1" reading and will be given the 2"d reading on July 25, 2003 for adoption. There will be no further Public Hearing on that Ordinance. This is a continuation of the Public Hearing from June 25, 2003. The Board of Directors has authority, and has adopted its Rules of Procedure for Conduct of Meetings. The Board will hear all interested parties, but with a 3-minute time limit. The Board will hear first from those persons who have not previously addressed the Board. The Board will hear from those who addressed the Board on June 25th, but ONLY if there is no new information to be presented. At the conclusion of all testimony, the Chair will likely close the public hearing. This will constitute the required public hearing for adopting increased fees, regardless of what rates and what duration is finally acted upon by the Board. There is presently an Ordinance that has been introduced and given the Vt of two required readings. If a motion is made to adopt that Ordinance and it receives 17 affirmative votes, it will pass and be the new schedule of rates. Alternatively, if a motion is made to amend or revise that Ordinance regarding either amount of the fees or the duration of years, that revised Ordinance, if passed, will be the 1" reading and will be given the 2nd reading on July 25, 2003 for adoption. There will be no further Public Hearing on that Ordinance. o � This is a continuation of the Public Hearing from June 25, 2003. The Board of Directors has authority, and has adopted its Rules of Procedure for Conduct of Meetings. The Board will hear all interested parties, but with a 3-minute time limit. The Board will hear first from those persons who have not previously addressed the Board. The Board will hear from those who addressed the Board on June 25th, but ONLY if there is no information to be presented. At the conclusion of all testimony, the Chair will likely close the public hearing. This will constitute the required public hearing for adopting increased fees, regardless of what rates and what duration is finally acted upon by the Board. There is presently an Ordinance that has been introduced and given the 1st of two required readings. If a motion is made to adopt that Ordinance and it receives 17 affirmative votes, it will pass and be the new schedule of rates. Alternatively, if a motion is made to amend or revise Ordinance regarding either amount of the fees or the duration of years, that revised Ordinance, if passed, will be the 1st reading and will be given the 2"d reading on July 25, 2003 for adoption. There will be no further Public Hearing on that Ordinance. Requests to Address BOD re Proposed Ordinance No.OCSD-20 Last Name First name City Albright Dean HB Ardia Ralph HB Bertolet Grant Costa Mesa Beyans Donald Anaheim Calderon Beatrice Santa Ana Chappell Charles Costa Mesa Cromer Howard Cypress Doezie Bob Newport Beach Dowd Nora Costa Mesa Dunn David Fullerton Durazo Paul Westminister Edge Judy Santa Ana England Marge Garden Grove England Tom Garden Grove Faber Harold Fullerton Flores Tony Garden Grove Glass Harold Anahem Gooch Daniel HB Hause Charles Placentia Haydock Irwin Fountain Valley Holdon Steve HB Jackson Steve Fountain Valley Jewell Greg Westminister Knypstra Phillip Orange Korthof Doug Seal Beach Leach Florence Santa Ana Leyes Mark Garden Grove Lindegren George Fountain Valley Mallinckrody Stanley Santa Ana Mintzer Alex Orange Murphy Eileen HB Nelson Rob HB Nicholes Linda Anaheim Nolte Darrell Westminister Norwood Bill Santa Ana Olesen Bob Santa Ana Petteruto Matt Garden Grove Pike Arnie Placentia Pike Marilyn Placentia Pilkenton Janice HB Porter Larry Proma Herbert(Burt) Brea Psaros George Laguna Niguel Psaros Helen HB Racano Joey HB Ralsten Maxwell Westminister Sandberg Charles Orange Stout Pat Garden Grove Swan Peer Newport Beach s Thatcher Reginald Newport Beach Vandersloot Jan Newport Beach Vodonic Emril Garden Grove Vu Joe Westminister Wetmar U. Robert Westminister Wood Bob Garden Grove i ROLL CALL J %� BOARD OF DIRECTORS ORANGE COUNTY SANITATION DISTRICT MEETING DATE: July 2, 2003 TIME: 5:30 p.m. (SIMONIAN) .................... ANDERSON................... (WILSON) ........................ BANKHEAD................... ��✓'_ ,v (MILLER) ........................ BRADY ....................... (YOST) ............................ CAMPBELL ................. ✓ _ AMBRIZ CAVECCHE................... ti (GARCIA) .......•..... ...... CHRISTY.............. CRANDALL . COLLINS ...................... (BOARDMAN) ................. COOK .................. �— (BROADWATER) ............. DALTON....................... (SHAWVER) .................... DONAHUE..................... (WILSON)........................ DUVALL...................... (UNDERHILL)................... ECKENRODE................. (SCHAFER)...................... FERRYMAN.................. (POE)................................ JEMPSA...................... (DAVERT)......................... KAWASHIMA............... L � (SHEA) ............................. KROM........................ (DOW) ............................. MARSHALL.................. Ai (HERNANDEZ)................. MC CRACKEN............... �_ y (FRESCHI) ....................... MC GOWAN ................. _ Y (BEAUMAN) ..................... MOORE........................ y (EPPERSON) NEUGEBAUER.................... ............. (KEENAN) PIERCY.... (WEBB) ............................ RIDGEWAY................... (SMITH, CHUCK) (HERMAN)........................ WALKER....................... ?� STAFF: Anderson Beekman Ghirelli Kyle / Ladwin- Mathews / Miles Ooten Tomko Streed OTHERS: Woodruff Nixon 05/20/03 G:\wp.dta\admin\BS\DIRECTOR\Directors Roll Call.doc +, S11N1/'err ti � _ 91' rr� e rx c July 2, 2003 MEMORANDUM TO: Board of Directors and General Public FROM: Blake P. Anderson General Manager 49& SUBJECT: Information for Tonight's Meeting Welcome to tonight's adjourned meeting of the Orange County Sanitation District. We have assembled for you the facts and figures that are most central to the subject of tonight's meeting. This is information that has been previously provided to the board or is an answer to questions and comments we received at last week's meeting. I hope that you find it useful. The following information is attached: 1. A ten-year graph entitled: "Cash Flow Budget FY 03-04 through FY 12-13, Annual Expenses by Category" that summarizes our Capital Improvement Program 2. The Executive Summary of the Capital Improvement Program Validation Study that was completed in April 2003 3. Two pages that provide answers to the 3 most frequently asked questions about our Capital Improvement Program 4. A ten-year graph entitled: "Potential annual Single Family Rate Sewer Fees" 5. A ten-year graph entitled: "Outstanding Certificates of Participation" 6. A Power Point slide entitled: "What about Reserves?" 7. A summary sheet entitled: "Options for Proposed Rate Increase" BPA:Ij Neadtda ta2twp.dta\adminlG&ITORMS%ME hIO-BPA.M CASH FLOW BUDGET FY03-04 THROUGH FY 12-13 ANNUAL EXPENSES BY CATEGORY $350,000,000 ®Past Expenditures Ell Other(Improved treatment and misc.support) ■Additional Capacity(Treatment and Collections) ❑Collections Rehabilitation and Replace $300,000,000— ❑Treatment Plant Rehabilitation and Replace WGroundwater Replenishment System ❑Full Secondary Treatment $250,000,000 ' $200,000,000- — $150,000,000 ' $100,000,000 I' i $50,000,000 z $0- - - -- 01 ---- - - - 00-01 01-02 02-03 03-04 04-05 05-06 06-07 07-08 08-09 09-10 10-11 11-12 12-13 April 8, 2003 IPMC ATTACHMENT 1 — CIP VALIDATION STUDY EXECUTIVE SUMMARY APRIL 16, 2003 SPECIAL BOARD WORKSHOP The Orange County Sanitation District's (District) Capital Improvement Program (CIP) consists of several hundred projects and equipment installations undertaken by the Engineering, Operations and Maintenance (O&M), and Information Technology (IT) Departments. The Engineering Department projects are generally referred to as the "large capital projects." Projects undertaken by the O&M and IT departments are called "Special Projects." The District's Capital Improvement Program (CIP) consists of projects identified in the 1999 Strategic Plan, 2002 Interim Strategic Plan Update, and projects that were added during the annual CIP budget process and include: • Major rehabilitation of the existing headworks, primary treatment, secondary treatment, outfall pumping, and solids handling facilities at both treatment plants. • Replacement and rehabilitation of 17 of the District's outlying pumping stations and 44 projects to rehabilitate the trunk sewers. • Funding for cooperative projects to help Cities upgrade their sewer systems. • Disinfection of the District's ocean discharge to reduce bacteria levels below State bathing standards. • Reclamation of 70 million gallon per day (mgd) of the District's effluent, or nearly one third of the total daily flow (Groundwater Replenishment System). • Implementation of full secondary treatment standards. Prioritizing Projects Based on Need Over the last six months the District's staff and consultants conducted a process to validate this CIP. This process involved a review of the need for each CIP project, and the associated, scope, budget, and schedule. The first step in this process was to develop the "Prioritization Principles" to ensure that the projects are needed to serve the community and maintain a safe working environment. These principles included: • Protect Health and Safety Assure that the health and safety of customers and the workers are protected. Page 1 of 5 4 • Provide most appropriate investment for rate payers Assure that the investment of rate payers' funds is appropriate by providing projects with schedules that truly match the projects needed,and repairing and replacing assets in a manner that enhances the asset life. • Protect and enhance livability and the environment Assure that the project focuses are on sustainability, meeting customer needs, and community expectations to be stewards of the environment. • Utilize most appropriate practices Assure that the investment in capital includes technology that demonstrates both best practices and reliability. • Expedite full secondary treatment projects Assure that projects are consolidated and allow for the maximum number of full secondary projects to occur as quickly and safely as possible. Validating Project Scopes. Budgets, and Schedules Following this prioritization process, the each project scope, budget, and schedule was reviewed to ensure that it is properly funded to complete those necessary tasks in a timely manner. This included the review of the several hundred projects currently in the CIP. The following are significant outcomes of this effort and will become the basis for the proposed FY 2003-2004 CIP. 1. There will be 136 large capital projects, 43 Special Projects, and various Capital Equipment expenditures in the proposed FY 2003-2004 CIP. The large capital projects were the focus of the detailed validation effort, but the Special Projects and Capital Equipment expenditures were revised based on their current status. The resulting projected expenditures for the proposed CIP for July 2003 through June 2021 is $2,373,264,000. All costs are current (2003) dollars. 2. The estimated projected cash flow for the proposed CIP is shown in Figure ES-1. During the first five years of the program, the annual cash flow expenditures range between $210 million and $307 million. The average annual expenditure over those 5 years is approximately $265 million, with the peak occurring in 2 successive years, FY 2004-2005 and FY 2005-2006. This chart does not include future undefined rehabilitation projects after the year 2010; however, an estimate of these future project expenses will be generated for projecting of future District fees and rates. Page 2 of 5 FIGURE ES-1 District Capital Improvement Program Program Cash Flow FY 2003-2004 to 2020-2021 $350 $307 $303 $300 $279 $251 N $250 11 $228 $232 210 $200 $162 $150 S $100 $96 $77 $50 $46 $48 $37 1---a$14 $32 $12 $9 $0 00 4 03104 04/05 07/06 06/09 09/10 10/11 1V12 12/13 13/14 14/15 15/16 16/17 17/16 18119 19/20 20121 Fiscal Years 3. The budget distribution for the proposed CIP in Figure ES-2 shows that the largest expenditures will be at Plant Nos. 1 and 2, followed closely by collections and full secondary treatment. Water Management Projects consist of the Groundwater Replenishment System (GWRS), water conservation, long-term monitoring, and the co-operative projects. Figure ES-2 Proposed CIP Budget Distribution Through 2021 $2,373,264,000 Capital Misc. Planning $ Equipment, Small Projects, $55,000,000, 2/6 $14,497,000, 1% Special Projects, $63,953,000, 3% Full Secondary - Water New, $422,152,000, 18% Management, $258,794,000, 11% Full Secondary - Rehab, Collection, $109,671,000, 5% $584,724,000, 25% Plants 1 &2, Joint, $671,670,000, 27% $192,804,000, 8% Page 3 of 5 i_ 4. The estimated CIP expenditure (from July 2002 through June 2021) in the 2002 Interim Strategic Plan Update (ISPU)was.$1,907,674,000. The ISPU estimate is about $565,590,000 less than the current projected cash flow of $2,373,264,000 (July 2003 through June 2021). The increase from the ISPU estimate is described in the Table ES-1. TABLE ES-1 ISPU Budget versus Proposed Validated CIP Budget Interim Strategic Plan Update Estimated CIP(*) $1,907,674,000 Estimated Expenditures thru July 2003 $100,000,000 Estimated Costs from July 2003 forward $1,807,674,000 Budget Deviations from July 2002: New Projects $22,833,000 Approved Budget Increases during FY02/03(**) $33,461,000 Escalation to 2003 Dollars $34,000,000 Toxicity Control Project Increases $164,312,000 New technologies Odor Control and Centrifuges $244,859,000 Asset Management Program $35,000,000 New Land Purchases for Pumping Stations $7,800,000 Large Capital Projects-Better definition of projects $229,765,000 Lar a Capital Projects-Deletions and Reductions $206,440,000 Deviation Subtotal $565,590,000 IPMC CIP Validation Estimate $2,373,264,000 Secondary Program Budget Expansion $422,152,000 Rehabilitation $109,671,000 Secondary Program Subtotal $531,823,000 (*)The ISPU "Total Estimated Project Budgets" is total project costs from July 2002 forward. The IPMC Validated Estimate is from July 2003 forward. (**) $28.7M attributed to the Groundwater Replenishment System (GWRS) project. Expediting Full Secondary Treatment Projects During this CIP validation process there was a separate effort to expedite full secondary treatment projects. This effort involved three parallel efforts including project consolidation workshops, a separate validation tasks just for the full secondary treatment projects, and program revisions based on the inputs from an independent peer review panel. 1. The consolidation workshops focused on reducing the total number of projects to be done by the District and reduce the time necessary to complete the full secondary treatment program. A number of projects were combined or eliminated as part of this effort. 2. The separate validation of the full secondary program focused on defining administrative and construction constraints and potential future issues. This Page 4 of 5 t involved estimating potential construction conflicts, outlining potential opportunities to expedite project schedules, and the assessment of known potential project risks. These ideas and issues were captured in the consultant detailed program evaluation report and will implemented with each project as they development, when possible. 3. The final process was a review of the full secondary treatment program by an independent panel of experts lead by Gerard Thibeault the Executive Officer of the California Regional Water Quality Control Board, Santa Ana Region. The panel commented that OCSD's 10-year implementation plan is realistic, reasonable, and achievable even compared to the 13 years and 11 years it took City of Los Angeles and Los Angeles County Sanitation Districts, respectively. The Review Panel provided valuable suggestions and comments that were incorporated in the final implementation plan. It was also noted that the District should continue to look for opportunities to be more efficient and creative to complete full secondary as early as possible. C:t =ments and SettingstburroADesktop%t11-VCIP ES 4-"3.doc Page 5 of 5 I' i 1. Is OCSD's rate increase driven by increased population and new development? No. Only 14% of the planned Capital Improvement Program (CIP) expenditures over the next 10 years is for projects to increase OCSD's capacity to collect and treat higher sewage flows. Of the $2.15 Billion CIP expenditures planned through 2013, $296 Million is for new capacity. The 1999 Strategic Plan and the 2002 Interim Strategic Plan Update used population projections for the OCSD service area to forecast the increased capacity needed through the year 2020. The 1999 Strategic Plan predicted a flow of 352 million gallons per day (mgd) in 2020. In 2002, the predicted flow for 2020 was revised downward to 321 mgd based on updated data. This revised projection allowed OCSD to reduce the 20-year capital improvement costs by $160 Million. The table below summarizes the projected growth and sewer flows in the OCSD service area. Year Population Housing Employment Flow Units 2000 2,379,704 825,119 1,265,853 241 mgd 2020 2,659,056 993,122 1,941,995 321 mgd Est. Increase 279,352 167,003 676,142 80 mgd Percent Increase 12% 1 20% 1 53% 1 33% 2. Was this large Capital Improvement Program anticipated? Yes. OCSD has always had a forward-looking, comprehensive facilities plan. In the mid 1970's, OCSD completed our first comprehensive Master Plan. In 1989, a 30-year Master Plan was adopted providing for$1.3 Billion in capital improvements. The 1999 Strategic Plan projected a 20-year, $1.5 Billion capital program for OCSD's collection system and treatment plants. These two plans did not include full secondary costs. The 1989 Plan assumed 50% secondary treatment. The 1999 Plan assumed somewhat less than 50% secondary treatment. Both of these plans called for increasing capital improvement expenditures and user fees. Five -year rate increases were planned in 1992 and 1997, as is currently proposed. However, some of the planned capital improvements were not completed as planned in the 1990's, and therefore rates were not increased accordingly. 1 Also, since 1997 when the most recent rates were adopted, OCSD has identified additional capital improvement needs, including: • Updated Groundwater Replenishment System costs (2002) • Outlying Pump Station Evaluation Upgrades (2000) • Odor Control Master Plan Requirements (2002) • Effluent Pathogen Reduction (2002) • Implementation of Full Secondary Treatment (2002) • Biosolids Management Requirements (Ongoing) • Additional Rehabilitation/Refurbishment/Replacement needs (2002, 03) Our most recent facilities plan, the 2002 Interim Strategic Plan Update, was reevaluated in early 2003. This CIP Validation Study was undertaken to prioritize the CIP projects, and to verify the scope, schedule and budget associated with the projects. A team of in-house and consultant engineering staff and other OCSD staff went through the entire list of capital projects applying evaluation factors that included: • Protecting Public Health and Safety, • Providing most appropriate investment for rate payers, • Protecting and enhancing livability and the environment, • Utilizing the most appropriate practices, and • Expediting full secondary treatment projects. The current CIP reflects this prioritization and validation process. The CIP Validation Study resulted in 31 projects being eliminated or combined with other projects, and created new schedules and project budgets. 3. Why did we defer maintenance until now? We haven't. OCSD has continuously maintained its facilities to provide uninterrupted service. A competent and well-trained maintenance department applies state-of-the-art preventative maintenance techniques to all of our systems. As discussed above, OCSD had master plans in place for over 30 years. Wastewater treatment facilities are a highly corrosive environment, and many of our facilities built in the 80's and earlier will need planned rehabilitation. These rehabilitation projects are planned based on the age and condition of the facilities. 2 Potential Annual SFR Sewer Fees $300 -- - -- $250 - /A $200 L d CL w $150 a) LL —t—Lowest 10-Year Rates (Borrow 100% CIP) LL —*—Maximum 10% Rate Adj (Borrow 86% CIP) N Maximum 15% Rate Adj (Borrow 65% CIP) $100 - $50 Off` Oh OHO O'l 00 00 ,NO �N ,�`L '�'3 ��` �O 4O '�k �O �°� rL0 O� Off` O� o 0 O� CO,o. � I �,�, � �°�, �O of rL0 10, 10 �O �O rL0 �O �O rL0 �O rL0 �O ',ON �O CADocuments and Settings\jensen\Local Settings\Temporary Internet Files\OLK4B4\BPE2MOOaFdit91.xls 1:00 PM 7/2/2003 Outstanding Certificates of Participation $2,500 —0 Lowest 10-Year Rates (Borrow 100% CIP) $2,000 —a--Maximum 10% Rate Adj (Borrow 86% CIP) --f—Maximum 15% Rate Adj (Borrow 65% CIP) i $1,500 0 G 0 N O $1,000 I $500 $0 --T 6-30-04 6-30-05 6-30-06 6-30-07 6-30-08 6-30-09 6-30-10 6-30-11 6-30-12 6-30-13 C:\Documents and Settings\jensen\Local Settings\Temporary Internet Files\0LK4B4Qlff1ia7Ahtl WIbChsW 1:00 PM " ? What About " Reserves ♦ Cash Flow Reserves Operations & Maintenance 50% $ 46.5 M ♦ Debt Service (P&I) 100% $ 36.9 M ♦ Operating Contingency 10% $ 9.3 M ♦ Capital Improvement Program 50% $ 185.4 M ♦ Self Ins, Catastrophic Loss Fixed $ 57.0 M ♦ Replacement, Refurb, Rehab 30% $ 52.0 M Total "Reserves" $ 387. 1 M Required Debt Service Reserve $ 33. 0 M CORRECTED 7.2.03 Options for Proposed Rate Increase Attribute 15%for 5 yrs 15% for 1 yr X% for 5 yrs Can be adopted tonight? Y N N Sets maximum rates for years 2-5? Y N Y Provides rate flexibility for years 2-5? Y Y Y Provides industrial and commercial Y N Y sector w/5- earpicture? Requires Board action in years 2-5? Y Y Y Requires 218 notification and hearing N Y, up to 4 N costs in years 2-5? times Requires second reading Jul 23? 1 N Y Y Requires public hearing Jul 23? 1 N N N G:1wp.dtaladmin11301Board of Directors\Rate increase 06.25.03.doc Requests to Address BOD re Proposed Ordinance No. OCSD-20 Last Name First name City Albright Dean HB Ardia Ralph HB Bertolet Grant Costa Mesa Bevans Donald Anaheim Calderon Beatrice Santa Ana Chappell Charles Costa Mesa Cromer Howard Cypress Doezie Bob Newport Beach Dowd Nora Costa Mesa Dunn David Fullerton Durazo Paul Westminister Edge Judy Santa Ana England Marge Garden Grove England Tom Garden Grove Faber Harold Fullerton Flores Tony Garden Grove Glass Harold Anahem Gooch Daniel HB Hause Charles Placentia Haydock Irwin Fountain Valley Holdon Steve HB Jackson Steve Fountain Valley Jewell Greg Westminister Knypstra Phillip Orange Korthof Doug Seal Beach Leach Florence Santa Ana Leyes Mark Garden Grove Lindegren George Fountain Valley Mallinckrody Stanley Santa Ana Mintzer Alex Orange Murphy Eileen HB Nelson Rob HB Nicholes Linda Anaheim Nolte Darrell Westminister Norwood Bill Santa Ana Olesen Bob Santa Ana Petteruto Matt Garden Grove Pike Arnie Placentia Pike Marilyn Placentia Pilkenton Janice HB Porter Larry Proma Herbert(Burt) Brea Psaros George Laguna Niguel Psaros Helen HB Racano Joey HB Ralsten Maxwell Westminister Sandberg Charles Orange Stout Pat Garden Grove Swan Peer Newport Beach -q� 1 Thatcher Reginald Newport Beach Vandersloot Jan Newport Beach Vodonic Emril Garden Grove Vu Joe Westminister Wetmar U. Robert Westminister Wood Bob Garden Grove r Public Comments Alphabetically Listed Board of Directors Meeting June 25, 2003 18. Dean Albright (Huntington Beach)—He was on Environmental Board. They have the money--$400 million Albright Dean reserves to do secondary treatment. Water rates are going up. Put a moratorium on more building in Orange County. Ardia Ralph 14. Rai h Ardis (Huntington Beach District reserves should be used. 2. Donald Berris (Anaheim)--Are you paying your fair share of costs? Lived in Anaheim since 1963. Now there are 12 Berris Donald 115 people per property in their neighborhood. 6. Beatrice Cauldren (Santa Ana)—My husband isn't working. We're on a fixed income. Quit blaming Prop 13. 1 have Cauldren Beatrice an aunt who is ill. 38. Charles Chapel (Costa Mesa)—I want improvements—don't borrow—charge it or pay for it—I ask for OCSD to Chapel Charles pay for it. 12. Howard Croner (Cypress)—When I got 218 notice tax bills from 1988=$2.09 for sewage. 1992+ $73.89/yr; 1997=$75/yr; 1998=$75.50/yr; 199=$76/yr; 2000=$78/yr; 2001=$80/yr; 2002=$87.50/yr; goose that laid the golden Croner Howard e 47. Bert Cronin (Brea}-1st time ever at a meeting. Commend Directors for their bravery. In unemployment times like Cronin Bert these. 26. Nora Dowd (Costa Mesa)--Since 1960. Has seen more people per housing unit—cities are at fault. Don't Dowd Nora understand this unnecessary increase. Dozie Bob 13. Bob Dozie—A artment association. No alternatives for renters 9. Paul Durazo (Westminster)--$87.50—did the math. . .20%. $2.1 to 2.3 billion. Toll road saddled with lots of bills. Homeowners fed up. Out of work for 11 months. Tired of dipping into our wallet. Civil engineer ought to do better Durazo Paul planning. Private industry doesn't pay this. Chasing people out of CA. Big bunch of malarkey. 4. Judy Edge (Santa Ana"ncreased employees by 57. You ask me for money—sow me the reason—cut salaries, cut retirement pay before you ask us for more. Secondary treatment, cry about trash in Balboa Bay. Teach children Edge Judy about trash in water. England Tom 16. Tom England Garden Grove Take sewer flow and get rid of it themselves. 17. Marge England (Garden Grove)—Urge you to waste no taxpayer money. Tax fee is not a 4-letter word. England Marge Responsible citizenry requires it. 45. Helen Faus—Check our benefits, retirement plans, studies. She owns property and pays same amount for a Faus Helen restaurant as warehouse. No one took notes on what the public is saying. Flores Tony 41. Tony Flores Garden Grove)—Senior rate. We should consider that. Gelass Harold 30, Harold Gelass Anaheim —10- earproject—why do you want it in 5 ears? What is a 2.3 billion C.I.P.? Public Comments Alphabetically Listed Board of Directors Meeting June 25, 2003 48. Daniel Good (Huntington Beach)—Sanitation District provides a lot of services people don't appreciate. Appreciate public officials. 100 people waiting outside to get in. A number of people are in favor of doing increase for Good Daniel just one year. 22. Irwin Haddock—Dr. of the Ocean—"Pile of hay on the dock." Fountain Valley—the value of his house increased $250,000. Ocean Outfall Group. No throwing of vegetables this time. We're not asking for Cadillac. We've been using the bus. Less than we pay for gas, e-mail, etc. It's not urban runoff. Ben Franklin. If we don't hang together, we Haddock Irwin will all hang separately. Halston Maxwell 39. Maxwell Halston (WestminsterHnequity in the way we asses multiple people in houses. 19. Charles House (Placentia)—You've been doing a good job. 2-9% increase previously now is a huge increase. I'm an engineer. Haven't heard anything about aiming too high. When our customer said scale back, we did. Totally House Charles unacceptable. 34. Greg Jewell (Surfrider)—Quoted old rates. Don't blame full secondary—LA Times writer got it right. Brady makes Jewell Greg ood sense—over one year. 3. Philip Kinestra (Orange)—Questions how much it costs to do what you do. Raise OCSD salaries so people paying Kinestra Philip can go broke? Every city, county, asking for more money. 23. Doug Korthof—I've studied these questions for years. No excessive salaries. $60 million to run plant. You get what you pay for. We have to pay for these costs. Not dwelling in piles of money. Reduce to 15% for one year. Blank Korthof Doug check not appropriate. Decrease rate increase. 8. Florence Leach—Please reconsider costs are passed on to purchasers $89.50 to $275 (wrong figures). All natural Leach FlorenCE resources are being depleted—Limit population growth. 43. Mark Leyes (Garden Grove)—Go to a happy place in your mind. Imagine an Orange County with no Irvine. It's Leyes Mark not right to raise rates becauseyou're the lowest. It lacks creativity, finesse. Financing makes sense. 20. Darth Lideman (Fountain Valley)—Huge increase. 130 projects. How many of these projects do you need to do? Lideman Darth $400 million—keep it--don't use it. Reduce other projects. 44. Alex Munster-1/2 gallon of milk, 4 Snickers bars, 6-8 rolls of toilet paper, 5 oz. Of tri-tip, 1 1/3 gallon of gas, 1 Munster Alex da 's el ctricity use. It's a bargain. Help full secondary. 11. Rob Nelson (Huntington Beach)—Understand the need for repair. It hurts. I don't like it, but encourage Board to Nelson Rob do 80%. 35. (Anaheim) Grateful for full secondary. Rates are still well below national average. Full secondary—money well Nichols Linda sent. Instead of getting extra pizza, don't defer maintenance. 31. Darrel Nolte—Fiscal conservative. Was here last month. Why do you blame secondary treatment in the 218 Nolte Darrel notice? You haven't legally noticed apartment dwellers—just homeowners. Public Comments Alphabetically Listed Board of Directors Meeting June 25, 2003 25. Bill Norwood (Tustin)—Workers comp. Medical insurance, foreclosures, all bad timing with these capital Norwood Bill improvements. 40. Bob Olson—You are the watchdogs. It's your responsibility. OCSD is wrong—pretty charts are nice, but Olson Bobperformance—they will not repair lateral. He will leave statement about court decision. 21. Dina Paton (Garden Grove)—She is a registered engineer, M.A. in environmental science. I sent a letter—most Paton Dina chemical processing labor is $30--whyare you doing 50% labor costs? Why are you giving retirement benefits? 27. Grant Perdolet—Vote against because of today's economy. Lots of retirees. Many elderly will be forced to leave Perdolet Grant their houses. This increase is a gross abuse of poor. Petterude Matt 129. Matt Petterude—Restate costs—affordable housing. Effects elderly, young. Vote no on fee. 32. Marilyn Pike 15% is a lot when you're on a limited income. 12-18 people in a one bedroom apartment. Trailers in Pike Marilyn front yard, using hoses and electric hook ups. Pike Arnold 33. Arnold Pike. Tax bill. Have to pay. Plankton Janice 15. Janice Plankton-2 bedroom apartment by myself, can't afford increase. 42. Larry Porter--Is there any pressure coming from D.C. on going to full secondary? (Blake—no, it's a local Porter Larry decision 10. Joey Racano—We have to tighten our belts. Urban runoff is a problem, but it's a reality. People put off by Racano Joey deferred maintenance. Money sifting in reserves to pay for it. We shouldn't be paying for it in advance. Spread it out. 7. Charles Sandburg (Orange)—Represents group hundreds of homeowners in Orange. District conducted a survey Sandberg Charles about strong opposition to rate hikes. District has not met that challenge. Savas George 46. George Savas—Inequityof many people in —S.F.R. Stroud Pat 37. Pat Stroud Garden Grove Hasn't seen sufficient justification for increase. 50. Peer Swan (Newport Beach)—IRWD, OCSD Board of Directors—Same flow as 1980's. Board has continually Swan Peer approved less increases. 40 people being added to payroll. Million dollar budget. Taylor Harold 28. Harold Taylor Fullerton Shocked at notice. 24. Reginald Thatcher (Newport Beach). Fail to see justification for rate increase. No reason to change the plant when it's still working. New hotel development of Huntington Beach. Did they pay? Unreasonable to improve rates Thatcher Reginalc on the public economy of scale. Here is the engineering. Don't soak the homeowner. 1. Jan Vandersloot: Future—grandchildren—give them a cleaner ocean—cost of getting rid of waiver=$30/year. Vote lVandersloot lian Ifor one year, 15% increase. Put pressure on District to do it every year. Public Comments Alphabetically Listed Board of Directors Meeting June 25, 2003 36. Robert Whitennaur (Anaheim)—Apartment owner. Won't be able to afford rent. Can you make improvements at Whitennaur Robert lower rates? 49. Joe Woo (Westminster)—Looks at other projects like subway, airport. Small group of people vote for large Woo Joe number of people. 5. Bob Wood (Garden Grove)—Resident since 1959 on fixed income. State of CA changed law that allows more Wood Bob people to live in a house. 10 flushes versus 80. 1 ' SIGN-IN SHEET ORANGE COUNTY SANITATION DISTRICT BOARD MEETING NAME ORGANIZATION/FIRM (please print) ease print '�' J os N fa ss O fa yC 0O v N br . / C.,• �I...� vt 1V = r �C X/V eQ.4 rcj L4 D - k L FT.t>,yz e Nr QE� Liz kl-- q IL C� Svc � L 21 14- Luc•-1 2S J P " H:\WP.DTA\ADMIN\BS\FORMS\SIGN-IN FORM.DOC • SIGN-IN SHEET ORANGE COUNTY SANITATION DISTRICT BOARD MEETING NAME ORGANIZATION/FIRM leaseprint) leaseprint) -6 1 t� 16r;N "uc raLRI,90 Pn -6fi Tsc/>Cffi ti � w C�, , H:\WP.DTAWDMIN\BS\FORMS\SIGN-IN FORM.DOC Ipl'T iDEDD DN YE I'm I SUPPORT THE NEEDED FEE HIKE, IT'S NOT A TAX NO FREEBEES PAY FOR THE FACILITIES I'm SUPPORT FEE INCREASE FOR ORANGE COUNTY SANITATION DISTRICT SUPPORT NEEDED FIXES INTRODUCTION i This statement is presented at the Public hearing held on June 25,2003 relative to the requested service fee increase. I will abbreviate my presentation because many wish to express their thoughts tonight. I will do this on the premise that the Board oeDirectors will read the entire presentation data given to the recorder at this time. FACTS Subdivision of Tract 3063 was accomplished in 1959 and legally accepted by the County of Orange at that time. This subdivision included dedication of the streets within that tract to the County of Orange and was duly accepted at that time. During 1964 Sanitation District #7 installed a sanitary collection system, which included laterals to the full width of the dedicated highway areas in Tract 3063 under bonded financing. Residents of that tract have since paid for that bonding. Thus at least a minimum of an"implied"contract has existed for the operation of that same entire sanitary collection system. In 1997-8,Sanitation District#7 was merged with OCSD. Official Documents of Sanitation District #7 and the OCSD as well as their auditors clearly and explicitly state that these sanitation districts shall operate as a system. A system is uniformly defined,as an operating entity comprised of those parts and pieces necessary to make it function. All piping,including sewer laterals necessary to make that system function are an essential portion of the system. Obviously,operation of a system also requires maintenance of that system to assure proper function. A simple analogy to this is that an automobile is an operation system comprised of essential parts and pieces. Thus if the wheels arc removed, the system cannot function as intended because some of its'parts arc missing. FAILURE INCIDENT During January of 2001 die lateral serving my residence in Tract 3063 stopped functioning because of a sag in the lateral,which had collected sediment,within the portion of the tract dedicated as a public highway. I had the lateral cleared and videotaped,which clearly shows the sag condition.Then I requested reimbursement from OCSD OCSD refused reimbursement and their legal counsel(Woodruff, Spradlin&Smart)stated the following reason for that denial: "I believe that the key issue with regards to your backup us having a clear understanding as to the ownership and thus the responsibility for the respective portions of the sanitary sewerage system serving your property. --------As you are probably aware,the real ownership of your property goes to the centerline of Skyway Drive(not just to the curb line). -------Nonetheless, it is your property. Based on that,the Sanitation District,and virtually all public agencies have their maintenance programs established on that legal basis. This means that the lateral sewer that connects between your residence and the District sewer in the street is entirely owned by you. That includes that portion between the curb line and the connection." EXISTING COURT DECISION CONCERNING SANTA CLARA COUNTY,CA Civ. No. 21010 May 19, 1964 227 Cal. App. 2d 294/ 1964 Cal.App.Lexis 1183;38 Cal. Rptr.580 The ruling issued in this case specifically stated that: "Dedication of Streets to Public Use Includes Sewers Underneath---and such dedication included the subsurface sewer lines." OWNERSHIP RECOGNITION There is no other agency, commercial or civil,which recognizes property ownership boundaries to the center of the street as stated by OCSD counsel. These agencies include the Title Insurance Companies, Orange County Recorders Office, Orange County Tax Assessor and Tax Collector,Interagency Insurance Exchange(AAA)for homeowner's liability,Orange County Planning Department,Orange County Building Permit Department,Title Guarantee Companies or any of the Orange County Codes. EXISTING OCSD OBLIGATION Obviously Orange County owns the entire waste collection system within dedicated highway areas and the OCSD is obligated to maintain that system,of which the laterals form an inie-ral part. OCSD is attempting to transfer maintenance responsibility to individual property owners at their-Knense when property owners have already paid for that service. Considering the OCSD stated position and the ruling given in the cited court case,OCSD is currently exposed to a class action law suit to enforce Sanitation System operation and necessary maintenance thereof and in addition legal expenses and reimbursement associated such a law suit. QUESTION What is the current position of the OCSD concerning this situation? It is requested that OCSD Board of Directors state their current position in writing to me,concerning lateral ownership and maintenance considering the ruling of the above cited court case. PROTEST STATEMENT If OCSD continues to deny ownership and maintenance of laterals,which are obviously a part of the collection system, what service, maintenance or ownership will they deny even if the increased service fees are implemented? The increase in service fees should be denied. LAW Omms OF WOODRUFF, SPRADLIN & SMART A PROFESSIONAL CORPORATION 701 SOUTH PARKER STREET,SUITE 8000■ ORANGE,CA 928684760 (714)558-7000 • FAX(714)835-7787 DIRECT DIAL: (714)564-2605 DIRECT FAX: (714)565-25M E-MAIL: TLW@NSS-LAW.COM February 13, 2002 Mr. Robert G. Olesen 12051 Skyway Drive Santa Ana, Ca. 92705 RE: Claim Presented to the Orange County Sanitation District Dear Mr. Olesen: On behalf of the Orange County Sanitation District, the Operations and Maintenance staff, following their investigation of the sewer backup on your property on or about January 5, 2002, has requested me as General Counsel to the District, to respond to your claim with an explanation of the various issues that need to be considered. I have now reviewed both your claim and the reports of the District staff as to what was discovered upon inspection at the time of the backup. First, let me start by indicating to you that the Orange County Sanitation District has always adhered to a policy that if the District, acting through its employees, is in any way responsible for damage being inflicted upon persons or property, that it is quick to acknowledge that and will stand responsible by reimbursing all appropriate amounts. By the same policy, however, when the District determines that it is not at fault, as the guardian of public monies, it cannot rightfully expend those monies for purposes of correcting, improving or otherwise aiding private property. I believe that the key issue with regards to your backup is having a clear understanding as to the ownership and thus the responsibility for the respective portions of the sanitary sewerage system serving your property. There is of course the sewer line, defined as a "lateral sewer," originating with your residential structure that then goes to a collector sewer that is owned by the District located within Skyway Drive. As you are probably aware, the real ownership of your property goes to the centerline of Skyway Drive (not just to the curb line). Of course, that portion between the curb and the centerline is encumbered by a dedication for a public street, granted to the public, and thus you could make no private use of the surface. Nonetheless, it is your property. TERRY C.ANDRUS■S7EPHEN J.BEATON■M.LOIS BOBAK■CAROLINE A BYRNE■JOIIN E CAVANAUGH■TAMI S.CROSBY CRAIG G.FARRINGTON■JOSEPH W.FORBATH■RICHARD W.HELMS■BRADLEY R HOGIN■DOUGLAS C.HOLLAND■LOIS E.JEFI•'REY ROBERTA A KRAUS■MAGDALENA LONA-WIANT■JULIE McCLOSKEY■THOMAS F.NIXON■BARBARA RAILEANU■JASON E.RESNICK JASON S.RETPERER■OMAR SANDOVAL■JOHN R.SHAW■GREGORY E.SIMONIAN■KENNARD R SMART,JR■DANIEL K.SPRADLIN LAURA A UNDERWOOD 0 THOMAS L.WOODRUFF • t . Mr. Robert G. Olesen February 13, 2002 Page 2 Based on that, the Sanitation District, and virtually all public agencies have their maintenance programs established on that legal basis. This means that the lateral sewer that connects between your residence and the District sewer in the street is entirely owned by you. That includes that portion between the curb line and the connection. The District's sole responsibility is to ensure that its collector line in the streets is maintained clear so as to prevent backups through the lateral sewers serving individual parcels of property. We believe that it is now uncontroverted that the root blockage occurred somewhere between the connection with the District sewer in the street and a point approximately 5 feet inside the curb line. When the District operated its TV cameras, even that portion was clear, and the connection was clear. Your private contractor apparently was able to remove the roots at some point in that approximate 25-foot length of lateral sewer between the collector sewer and the clean-out. Because the blockage was in your line, the District has no responsibility for its maintenance or its repair, and likewise is not responsible if, due to lack of maintenance and repair, a backup should occur. For that reason, the District must decline to pay for the expenses that you incurred between January 5 and January 7, 2002. In a closing note, I would just personally comment that I commend you for the seriousness with which you approached this and the integrity by which you prepared the claim. Periodically, the District receives these claims and oftentimes they are so grossly inflated as to the "expenses and damages" that were incurred, as to be almost disturbing. I believe that your request for the total cost reimbursement is very accurate and very reasonable, and if the District was legally responsible, there would be no point of contention as to propriety of the evaluation. Our Staff, during the course of the inspection, did note a slight sag in your lateral sewer line in the final reach of it, as it approaches the connection to the District's sewer. They do not believe that it is so serious, however, as to warrant a major reconstruction. They have advised now that a clean-out has been located, you periodically see to it that it is flushed and maintained in as open a status as possible. If you should have any questions or comments, I would welcome them. Very truly yours, WOODRUFF, SPRADLIN &SMART A Professional Corporation THOMAS L.WOODRUFF TLw:Jlo GENERAL COUNSEL—OCSD 147672\1 B.T.GALEB et al., Plaintiffs and Respondents,v.CUPERTINO SANITARY DIST121CT OF SANTA CLARA COUNTY,Defendant and Appellant Civ.No.21010 Court of Appeal of California,First Appellate District,Division Two 227 Cal.App. 2d 294; 1964 Cal. App. LEXIS 1183;38 Cal. Rptr. 580 May 19, 1964 SUBSEQUENT HISTORY: 1**11 1*2961 (***5821 The Cupertino Sanitary District A Petition for a Rehearing was Denied June 10, of Santa Clara County (hereafter referred to as district) 1964, and Respondents' Petition for a Hearing by the appeals from a judgment holding that the respondents,B. Supreme Court was Denied July 15, 1964. T. Galeb and his wife(hereafter referred to as Galeb)had a proprietary interest in a community sewer system and awarding 1**21 them compensation therefor. The PRIOR HISTORY: appellant district contends that: (1) the streets were APPEAL from a judgment of(lie Superior Court of Santa dedicated to public use; (2) the dedication of streets to Clara County. Homer B.Thompson, Judge. public use includes the sewers underneath; and(3)Galeb Action by owners of a subdivisi.,ii against a county was not entitled to any compensation. sanitation district to establish their proprietary interest in Facts a community sewer system and for compensation for A brief review of the events leading to this action is facilities taken by the county. necessary for an understanding of the questions presented: In 1941, the Galebs owned approximately 75 DISPOSITION: acres of land southeast of the Saratoga-Sunnyvale Road Reversed with directions. Judgment for plaintiffs in an unincorporated area of Santa Clara County. They reversed with directions. proceeded to subdivide this property. Tract 184 COUNSEL: On June 23, 1941, the Galebs filed a final Sam J. Anderson and Robert W. Harrison for subdivision map for a portion of their property Defendant and Appellant. immediately east of the Saratoga-Sunnyvale Road, Bohn & Williams, Charles J. Williams and Gerald designated as Tract No. 184, Azule Homesite No. 1, and Ellersdorfer as Amici Curiae on behalf of Defendant and consisting of lots 1 to 16, The map of Tract 184 showed Appellant. two streets: Sea Gull Way running west from its intersection with the Saratoga-Sunnyvale Road and Thorne, Stanton, Clopton, Herz & Stanek, John E. Zorka Avenue curving southwest from its intersection Thorne and William F. Stanton for Plaintiffs and with Sea Gull Way. Both Sea Gull Way and Zorka Respondents. Avenue were offered for dedication to public use. The certificate of the clerk of the Santa Clara County Board of Supervisors dated June 23, 1941, showed an approval JUDGES:Taylor,J. Shoemaker, P. J., and Agee, J.,concurred. of the subdivision 1**31 map but a rejection of the street dedication. In January 1947, the Board of Supervisors of OPINIONBY: Santa Clara County accepted the street work in Tract 184 TAYLOR and in May 1953, accepted the streets into the county road system. OPINION: Page 4 227 Cal. App. 2d 294, *; 1964 Cal.App. LEXIS 1183, **; 38 Cal. Rptr. 580, *** into evidence of the duly executed agreement of The trial court erred in excluding from evidence February 27, 1960, the building restrictions and appellant's Exhibit N, a certified copy of a formal modifications of Tracts 184 and 485 as well as several resolution of the Santa Clara Board of Supervisors other documents. The court at the pretrial conference passed May 4, 1953, ordering Sea Gull Way, Ted suggested that the legal issues'relating to the Galeb claim Avenue and Zorka Avenue to be accepted into the county of an existing proprietary interest be tried first and the [**151 road system. The fact that appellant did not amount of compensation, if liability were established, be introduce the board's resolution into evidence until the left to a subsequent proceeding. At the first trial, it was damage phase of the proceeding is not important since it decided that Galeb did have a proprietary interest and had been stipulated that, though bifurcated, the entire thereafter at the second trial, the compensation was fixed trial was to be considered a single proceeding. In any at $ 9,661.17 and judgment for Galeb was entered event, the resolution would clearly be relevant on accordingly. 1**131 This appeal ensues. We have [***5861 the issue of damages. It is before us as a concluded that the judgment must be reversed. public record erroneously excluded. Streets Dedicated To Public IJse The supervisors' previous rejection of Galeb's offer The First issue is whether the streets in question were of dedication does not render this resolution ineffective. The provisions of the Subdivision Map Act clearly dedicated toVpirbTiciise.Words oi'�dication on a indicate that such a rejection is not final, that the offers u r n isron map arc_an offer to -cTedicat-e Tul-��ie —Ii cdication is not completed until the of r rs acceptedr( remain open, and the board is authorized to accept them at any later date. The offers to dedicate the streets in Snrnrp r. Cornell ConstructiorrZ"o:-7�Zc'TZc 75 question were thus accepted, and the dedication thereof P.2d 510J). Respondents concede that the filing of the completed in conformity with the statute by the subdivision maps for Tracts 184 and 485 offered the resolution of the board of supervisors on May 4, 1953. streets in both tracts for dedication and that these offers .were never withdrawn. They contend, however, that in After the acceptance of the streets by the county in view of the county's initial refusal of offers of dedication, 1953, its jurisdiction over sanitary matters was the requirements of acceptance have not been met. transferred to the appellant's predecessor, County As both offers of dedication occu..--d in this instance Sanitation District No. 7, in 1954(Health&Saf. Code,§ after the adoption of the Subdivision Map Act (Bus. & § 6465 et seq.)and in 1956 to the appellant. The City of Prof. Code, §§ I1500 et seq., first enacted in 1937 and Saratoga after its [**161 incorporation in 1956 was not reinacted in 1943), the rules governing statutory rather required to accept the streets previously accepted by the than common law dedications control the disposition of county. the issue here presented ( McKinney v. Ruderynan, 203 The respondents argue that there can be no Cal.App.2d 109(it p. //6[21 C'al.Rptr. 2631; Qnracc•hia dedication here since the formal resolution of acceptance v. County of Santa Cruz, 164 Cal.App.2d 770[331 P.2d was not recorded as required by Business and 216]). Professions Code section: 11616 where previous offers B su iness and Professions**14 Code section have been rejected. The constructive [*303[ notice 11616 provided at the time here_ relevant: If at the time required by section 11616 is merely an ancillary --- ministerial act and is not an essential requirement of the the final-map is approved any streets, paths, alleys, or statutory dedication ( Bentley v. Hurlburt, 153 Cal. 796 storm drainage easements are rejected, the offer of [96 P. 890J; Sturnrp v. Cornell Construction Co., 29 dedication shall remain open 1*3021 and the governing Cal.2d 448, 452[175 P.2d S10J). body may by resolution at any later date, and without further action by the subdivider, rescind its action and Dedication Of Streets To Public Use Includes accept and open the streets, paths, alleys, or storm Sewers Underneath drainage easements for public use, which acceptance The second s e presented is whethJea dedicatio shall be recorded in the office of the county recorder; of streets to public use includes the seunderneath. provided, however, that if said offer of dedication has In other jurisdictions, the well settled rthat by the never been accepted, the right to accept said offer as to dedication of land for a public street, unicipality all or any of the streets, paths, alleys, or storm drainage acquires not only the easement of passut also the easements shown on the map may be terminated and right to grade and improve the surface otreet and to abandoned in the same manner as is prescribed for the lay sewers, drains and pipes for variousies beneath abandonment or vacation of streets or highways by part the surface ( Levi v. Schwartz (1953) 2d. 575 [9S 3, division 9, or by chapter 2, division 2, of the Streets A 2d 321 36 A.L.R.2d 1141]; cf. Nicol *171 New and Highways Code,whichever is applicable." York & N. & J. Tel. Co., 62 N.J.L. 73A. 583, 72_ b Am. St. Rep. 666J; Riley v. Davidson . Civ.App. vJ 2I c �t dr G t 1,Qd 4, G n 4 C�[ L/ Page 5 227 Cal. App. 2d 294, *; 1964 Cal. App. LEXIS 1183, **; 38 Cal. Rptr. 580, *** e 1946) 196 S.W 2d 557; /it re Opinion of Justices (1937) Authority v. City of McKeesport, supra, a developer had 297 Mass. 559 [8 N.E.2d 179], Haven Hanes, Inc. v. laid water mains and dedicated to the city the streets for Raritan Township (1955) 19 N.J. 239 [116 A.2d 25]; which they were laid. In a quiet title action, the court Versailles Tp. Authority v. City of McKeesport (1952) held that the dedication of the street included the 171 Pa. Super•. 377 [90 A.2d 581]; Cheltenham & dedication of the mains for public use, and that it was Abington Sesverage Co. v. Public Service Com. (1933) immaterial whether the mains were laid before or after 311 Pa. 175 [166 A. 649]; Newport Manor, Inc. v. the dedication, thus recognizing that the dedication of a Carmen Land Co. (Fla 1955) 82 So.2d 127; Coburn v. street is not limited to the surface but encompasses the New Telephone Co. (1901) 156 Ind. 90 [59 N.E. 324, subsurface including the use of any pipes that may be 325, 52 L.R.A. 671]; City of Shawnee v. Thompson there,as well as the right to lay pipes in the future. (Okla. 1954) 275 P.2d 323; City oj'Leadville v. Bolin Respondents erroneously argue that the dedication Mitring Co., 37 Colo. 248[86 P. 1038, I I Ann. Cas. 443, of the streets to public use does not include dedication of 8 L.R.A.N.S. 422]; 10 McQuillin on Municipal the existing sewers unless the sewers are specifically Corporations(3d ed) § 30.06). mentioned or shown on the map. Section 11590 of the We_tliink the rule i5 tll�jatne..i►t this state thouLh the Business and Professions Code provides that a dedication precise question has never bcenprescnted. The Supreme is "subject to such reservations as may be contained" in Court did lioid in San Francisco v. Grote, 120 Cal. 59 the offer. The language of the dedications here 152 11. 127. 65 A►►r.St.Rep. 155, 41 L.R.A. 335j, that the contained no express reservations and the secret city could maintain an action for ejectment for a parcel intentions [**201 of the dedicator are of no significance of property (a street) 1**181 dedicated to public use. ( Futterer v. City of Sacramento, 196 Cal. 248 [237 P. The court said at page 61: "It may be conceded that a 48]). The rule is that when a dedicator has caused an naked right of way, an easement in its simplest form, a uncertainty as to the location and extent of a public way, mere right to pass over the land of another, is a thing so an interpretation most favorable to the public and against intangible and unsubstantial as to be insufficient to the dedicator must be adopted ( McGinn v. State Board support an action of ejectment. But here the right of the of Harbor Comrs., 113 Cal.App. 695, 702[299 P. 100]). city goes far beyond that. The city has the right of exclusive possession, a right to disturb the soil, a right to The streets in question in this action were properly dedicated_to.._p9mic�use wit io reservation sue grade and otherlvise improve the street in►nary ways. in other words,words, 1*3041 more than a mere right to the use of edSation included the su surfa_ce sewer lines, and the responde'n(srweie not entitled to co^ ensa�ho t ier�eTor'. a street passes to the public by dedication; in addition to *the right of use there passes such an interest in the land Additionally, because [ 3051 of the serious pu is as is necessary for the enjoyment of that use by the health menace certified to its board, the appellant district public." (Italics added.) would seem entitled to take the sewers as a proper exercise of its police power (Health & Saf. Code, § Section 905 of the Streets and Highways Code 6518; Archer v. City of Los Angeles, 19 Cal.2d 19[199 provides, inter alia,that the acquisition by the public of a P.2d 1]; Southern Cal. Gas Co. v. City of Los Angeles, highway [***5871 right of way includes "the incidents 50 Cal.2d 713 [329 P.2d 289]). In view of these necessary to enjoy and maintain the same." Where the conclusions, it is not necessary to discuss the atreets,are dedicated to public use ins the development of questionable measure of damages applied by the trial a residential sub iviston such+"incidents" would most court. We find it difficult, however, to comprehend how assuredly include gas,-waier.and 'sewer mains. "'"''" the respondents suffered any damage [**211 or were R relieved of anything except the arduous and costly Respondents argue that the authorities from other jurisdictions are not (**191 relevant here as they apply responsibility of maintaining a depreciating sewer system over a long period of years. only to the right to lay new sewers but cannot be applied to the taking of existing sewers. This distinction finds no The judgment is reversed and the trial court directed support either in reason or law. In Versailles Tp. to enter judgment for the appellant district. 4J�\+ SAHIIoH /^ i Q 1 July 2, 2003 MEMORANDUM TO: Board of Directors and General Public FROM: Blake P. Anderson 44& General Manager SUBJECT: Information for Tonight's Meeting Welcome to tonight's adjourned meeting of the Orange County Sanitation District. We have assembled for you the facts and figures that are most central to the subject of tonight's meeting. This is information that has been previously provided to the board or is an answer to questions and comments we received at last week's meeting. I hope that you find it useful. The following information is attached: 1. A ten-year graph entitled: "Cash Flow Budget FY 03-04 through FY 12-13, Annual Expenses by Category" that summarizes our Capital Improvement Program 2. The Executive Summary of the Capital Improvement Program Validation Study that was completed in April 2003 3. Two pages that provide answers to the 3 most frequently asked questions about our Capital Improvement Program 4. A ten-year graph entitled: "Potential annual Single Family Rate Sewer Fees" 5. A ten-year graph entitled: "Outstanding Certificates of Participation" 6. A Power Point slide entitled: "What about Reserves?" 7. A summary sheet entitled: "Options for Proposed Rate Increase" BPA:lj \\lead\data2\wp.dta\adm n\GM\FORMS\MEMO-BPA.M CASH FLOW BUDGET FY03-04 THROUGH FY 12-13 ANNUAL EXPENSES BY CATEGORY $350,000,000 ■Past Expenditures OOther(Improved treatment and misc.support) ■Additional Capacity(Treatment and Collections) CI Collections Rehabilitation and Replace $300,000,000 0Treatment Plant Rehabilitation and Replace NGroundwater Replenishment System O Full Secondary Treatment $250,000,000 $200,000,000- $150,000,000 r r $100,000,000 $50,000,000 $0 J -D. - - 00-01 01-02 02-03 03-04 04-05 05-06 06-07 07-08 08-09 09-10 10-11 11-12 12-13 April 8, 2003 IPMC ATTACHMENT 1 — CIP VALIDATION STUDY EXECUTIVE SUMMARY APRIL 16, 2003 SPECIAL BOARD WORKSHOP The Orange County Sanitation District's (District) Capital Improvement Program (CIP) consists of several hundred projects and equipment installations undertaken by the Engineering, Operations and Maintenance (O&M), and Information Technology (IT) Departments. The Engineering Department projects are generally referred to as the "large capital projects." Projects undertaken by the O&M and IT departments are called "Special Projects." The District's Capital Improvement Program (CIP) consists of projects identified in the 1999 Strategic Plan, 2002 Interim Strategic Plan Update, and projects that were added during the annual CIP budget process and include: • Major rehabilitation of the existing headworks, primary treatment, secondary treatment, outfall pumping, and solids handling facilities at both treatment plants. • Replacement and rehabilitation of 17 of the District's outlying pumping stations and 44 projects to rehabilitate the trunk sewers. • Funding for cooperative projects to help Cities upgrade their sewer systems. • Disinfection of the District's ocean discharge to reduce bacteria levels below State bathing standards. • Reclamation of 70 million gallon per day (mgd) of the District's effluent, or nearly one third of the total daily flow (Groundwater Replenishment System). • Implementation of full secondary treatment standards. Prioritizing Projects Based on Need Over the last six months the District's staff and consultants conducted a process to validate this CIP. This process involved a review of the need for each CIP project, and the associated, scope, budget, and schedule. The first step in this process was to develop the "Prioritization Principles" to ensure that the projects are needed to serve the community and maintain a safe working environment. These principles included: • Protect Health and Safety Assure that the health and safety of customers and the workers are protected. Page 1 of 5 } • Provide most appropriate investment for rate payers Assure that the investment of rate payers' funds is appropriate by providing projects with schedules that truly match the projects needed,-and repairing and replacing assets in a manner that enhances the asset life. • Protect and enhance livability and the environment Assure that the project focuses are on sustainability, meeting customer needs, and community expectations to be stewards of the environment. • Utilize most appropriate practices Assure that the investment in capital includes technology that demonstrates both best practices and reliability. • Expedite full secondary treatment projects Assure that projects are consolidated and allow for the maximum number of full secondary projects to occur as quickly and safely as possible. Validating Project Scopes, Budgets, and Schedules Following this prioritization process, the each project scope, budget, and schedule was reviewed to ensure that it is properly funded to complete those necessary tasks in a timely manner. This included the review of the several hundred projects currently in the CIP. The following are significant outcomes of this effort and will become the basis for the proposed FY 2003-2004 CIP. 1. There will be 136 large capital projects, 43 Special Projects, and various Capital Equipment expenditures in the proposed FY 2003-2004 CIP. The large capital projects were the focus of the detailed validation effort, but the Special Projects and Capital Equipment expenditures were revised based on their current status. The resulting projected expenditures for the proposed CIP for July 2003 through June 2021 is $2,373,264,000. All costs are current (2003) dollars. 2. The estimated projected cash flow for the proposed CIP is shown in Figure ES-1. During the first five years of the program, the annual cash flow expenditures range between $210 million and $307 million. The average annual expenditure over those 5 years is approximately $265 million, with the peak occurring in 2 successive years, FY 2004-2005 and FY 2005-2006. This chart does not include future undefined rehabilitation projects after the year 2010; however, an estimate of these future project expenses will be generated for projecting of future District fees and rates. Page 2 of 5 DiStric PIG t Capit111, l i V RE ES.1 Pro m Oroye $35o FY200 g20 aSh 04 to on program $300 $30 ? $3p3 2020 -2421 f"S�D $250 $279 $2p0 210 $22 8$251 $232 $150 d sloo $162 $50 $96 $o $77 °5 °moo 8 08,0�°)r°g 08,08 0 9,10 $4 6 $48$37 3. Th $28$73 3 2 anr9esf e9pe d/stribUtioU �j�a/ years M,u ',s �,,, - $14 s12 $9 Gr t full seoOnditures will for the pro ,�, °Undv'at ndary tie be at p/ posed ClP l nonitoring and peen i h mie ttsWater nt Mai 1 and 2 t90 re ES'2 sh o'operativ�p o eern�G�NRs), thgerf7eat�l°lei S%se Y by�t the Pr s ter cOnSeNcltioconsn t of t/7 Ctions oposed C'p Ir Bud9e9Ure Eg 2 ng-term $2,31�?�4000 Tbrou capital �� 9h?02? SPecial p $559uipment ro' ,00 $63,g53,OOp a ots, 0,00p, 2j Misc. plan. Marra ater 3� $ma/I Prole is$ $?58,nagernent, 4,497,000 �, 794,000, o- vo kR $S collection pull Secondary. 84,724,000,' ' / $422�1�eoo0 Full Second Rehab dry $1g?�8 p4,�00 u $10g,671,000 5� $sue�s%000 z 27% Page 3 of 5 r 4. The estimated CIP expenditure (from July 2002 through June 2021) in the 2002 Interim Strategic Plan Update (ISPU) was.$1,907,674,000. The ISPU estimate is about $565,590,000 less than the current projected cash flow of $2,373,264,000 (July 2003 through June 2021). The increase from the ISPU estimate is described in the Table ES-1. TABLE ES-1 ISPU Budget versus Proposed Validated CIP Budget Interim Strategic Plan Update Estimated CIP(*) $1,907,674,000 Estimated Expenditures thru July 2003 $100,000,000 Estimated Costs from July 2003 forward $1,807,674,000 Budget Deviations from July 2002: New Projects $22,833,000 Approved Budget Increases during FY02/03(**) $33,461,000 Escalation to 2003 Dollars $34,000,000 Toxicity Control Project Increases $164,312,000 New technologies Odor Control and Centrifuges $244,859,000 Asset Management Program $35,000,000 New Land Purchases for Pumping Stations $7,800,000 Large Capital Projects- Better definition of projects $229,765,000 Large Capital Projects- Deletions and Reductions $206,440,000 Deviation Subtotal $565,590,000 IPMC CIP Validation Estimate $2,373,264,000 Secondary Program Budget Expansion $422,152,000 Rehabilitation $109,671,000 Secondary Program Subtotal $531,823,000 (*)The ISPU "Total Estimated Project Budgets" is total project costs from July 2002 forward. The IPMC Validated Estimate is from July 2003 forward. (**) $28.7M attributed to the Groundwater Replenishment System (GWRS) project. Expediting Full Secondary Treatment Projects During this CIP validation process there was a separate effort to expedite full secondary treatment projects. This effort involved three parallel efforts including project consolidation workshops, a separate validation tasks just for the full secondary treatment projects, and program revisions based on the inputs from an independent peer review panel. 1. The consolidation workshops focused on reducing the total number of projects to be done by the District and reduce the time necessary to complete the full secondary treatment program. A number of projects were combined or eliminated as part of this effort. 2. The separate validation of the full secondary program focused on defining administrative and construction constraints and potential future issues. This Page 4 of 5 ' f r involved estimating potential construction conflicts, outlining potential opportunities to expedite project schedules, and the assessment of known potential project risks. These ideas and issues were captured in the consultant detailed program evaluation report and will implemented with each project as they development, when possible. 3. The final process was a review of the full secondary treatment program by an independent panel of experts lead by Gerard Thibeault the Executive Officer of the California Regional Water Quality Control Board, Santa Ana Region. The panel commented that OCSD's 10-year implementation plan is realistic, reasonable, and achievable even compared to the 13 years and 11 years it took City of Los Angeles and Los Angeles County Sanitation Districts, respectively. The Review Panel provided valuable suggestions and comments that were incorporated in the final implementation plan. It was also noted that the District should continue to look for opportunities to be more efficient and creative to complete full secondary as early as possible. CADocuments and SettingslburrorlDesktopVita-VCIP ES 4-"Idoc Page 5of5 i 1. /s OCSD-s rate increase driven by increased population and new development? No. Only 14% of the planned Capital Improvement Program (CIP) expenditures over the next 10 years is for projects to increase OCSD's capacity to collect and treat higher sewage flows. Of the $2.15 Billion CIP expenditures planned through 2013, $296 Million is for new capacity. The 1999 Strategic Plan and the 2002 Interim Strategic Plan Update used population projections for the OCSD service area to forecast the increased capacity needed through the year 2020. The 1999 Strategic Plan predicted a flow of 352 million gallons per day (mgd) in 2020. In 2002, the predicted flow for 2020 was revised downward to 321 mgd based on updated data. This revised projection allowed OCSD to reduce the 20-year capital improvement costs by $160 Million. The table below summarizes the projected growth and sewer flows in the OCSD service area. Year Population Housing Employment Flow Units 2000 2,379,704 825,119 1,265,853 241 mgd 2020 2,659,056 993,122 1,941,995 321 mgd Est. Increase 279,352 167,003 676,142 80 mgd Percent Increase 1 12% 1 20% 1 53% 33% 2. Was this large Capital Improvement Program anticipated? Yes. OCSD has always had a forward-looking, comprehensive facilities plan. In the mid 1970's, OCSD completed our first comprehensive Master Plan. In 1989, a 30-year Master Plan was adopted providing for $1.3 Billion in capital improvements. The 1999 Strategic Plan projected a 20-year, $1.5 Billion capital program for OCSD's collection system and treatment plants. These two plans did not include full secondary costs. The 1989 Plan assumed 50% secondary treatment. The 1999 Plan assumed somewhat less than 50% secondary treatment. Both of these plans called for increasing capital improvement expenditures and user fees. Five -year rate increases were planned in 1992 and 1997, as is currently proposed. However, some of the planned capital improvements were not completed as planned in the 1990's, and therefore rates were not increased accordingly. 1 Also, since 1997 when the most recent rates were adopted, OCSD has identified additional capital improvement needs, including: • Updated Groundwater Replenishment System costs (2002) • Outlying Pump Station Evaluation Upgrades (2000) • Odor Control Master Plan Requirements (2002) • Effluent Pathogen Reduction (2002) • Implementation of Full Secondary Treatment (2002) • Biosolids Management Requirements (Ongoing) • Additional Rehabilitation/Refurbishment/Replacement needs (2002, 03) Our most recent facilities plan, the 2002 Interim Strategic Plan Update, was reevaluated in early 2003. This CIP Validation Study was undertaken to prioritize the CIP projects, and to verify the scope, schedule and budget associated with the projects. A team of in-house and consultant engineering staff and other OCSD staff went through the entire list of capital projects applying evaluation factors that included: • Protecting Public Health and Safety, • Providing most appropriate investment for rate payers, Protecting and enhancing livability and the environment, • Utilizing the most appropriate practices, and • Expediting full secondary treatment projects. The current CIP reflects this prioritization and validation process. The CIP Validation Study resulted in 31 projects being eliminated or combined with other projects, and created new schedules and project budgets. 3. Why did we defer maintenance until now? We haven't. OCSD has continuously maintained its facilities to provide uninterrupted service. A competent and well-trained maintenance department applies state-of-the-art preventative maintenance techniques to all of our systems. As discussed above, OCSD had master plans in place for over 30 years. Wastewater treatment facilities are a highly corrosive environment, and many of our facilities built in the 80's and earlier will need planned rehabilitation. These rehabilitation projects are planned based on the age and condition of the facilities. 2 Potential Annual SFR Sewer Fees $300 — — - $250 - - - $200 - I a w $150 — a� U- ��Lowest 10-Year Rates (Borrow 100% CIP) W Maximum 10% Rate Adj (Borrow 86% CIP) —A Maximum 15% Rate Adj (Borrow 65% CIP) $100 — — $50 — $0 O� Q0 06 6 00 O°b IO N N-1 N� INN N� NO NA NO No rL0 Ofl, OA, O(, Ob, 0A, OIV O(T, AO, A N' A(�� A,1 A� A(, Arb, A,1, Adj ACY `LO 9O In �O J �O V 1O 1O V �O J �O` �O_` �O.`V �O`J �O_` �O_`J �O.` �O`` �O_`1J �O-`J C:\Documents and Settings\jensen\Local Settings\Temporary Internet Files\OLK4B4\BP/2gZ3-02�fdft3l.xls 1:00 PM 7/2/2003 Outstanding Certificates of Participation $2,500 --♦—Lowest 10-Year Rates (Borrow 100% CIP) $2,000 --A—Maximum 10% Rate Adj (Borrow 86% CIP) }Maximum 15% Rate Adj (Borrow 65% CIP) $1,500 0 0 0 W C O $1,000 $500 $0 6-30-04 6-30-05 6-30-06 6-30-07 6-30-08 6-30-09 6-30-10 6-30-11 6-30-12 6-30-13 C:\Documents and Settings\jensenlLocal Settings\Temporary Internet Files10LK4B4UWAa7)&gGQtKh*I 1:00 PM What About " Reserves " ? ♦ Cash Flow Reserves Operations & Maintenance 50% $ 46.5 M ♦ Debt Service (P&I) 100% $ 36.9 M ♦ Operating Contingency 10% $ 9.3 M ♦ Capital Improvement Program 50% $ 185.4 M ♦ Self Ins, Catastrophic Loss Fixed $ 57.0 M ♦ Replacement, Refurb, Rehab 30% $ 52.0 M Total "Reserves" $ 387. 1 M Required Debt Service Reserve $ 33. 0 M CORRECTED 7.2.03 Options for Proposed Rate Increase Attribute 15% for 5 yrs 15% for 1 yr X% for 5 yrs Can be adopted tonight? Y N N Sets maximum rates for years 2-5? Y N Y Provides rate flexibility for years 2-5? Y Y Y Provides industrial and commercial Y N Y sector w/5- earpicture? Requires Board action in years 2-5? Y Y Y Requires 218 notification and hearing N Y, up to 4 N costs in years 2-5? times Requires second reading Jul 23? N Y Y Requires public hearing Jul 23? N N N G:\wp.dta\admin\130\Board of Directors\Rate increase 06.25.03.doc July 2, 2003 ',1�/ 3 Board of Directors, OCSD The Board of Directors has approved spending over$2.3 Billion for maintaining and improving OCSD. This money has to come from somewhere. Approved paying $50 Million over five years for Program Management to IPMC Approved the Capital Improvement Program with over$1.1 Billion in rehab and upgrade Approved GWRS for over$250 Million Approved expanding secondary treatment for GWRS and total 2' aprox $400 M Approved Cooperative Projects Approved repairing and upgrading the Collections System Where is the money going to come from to pay for these as well as operating the system? Borrow? Use reserves? Increase user fees? Borrowing can allow the CIP to occur, but overall costs will increase since the money borrowed must be paid back with interest. The interest rate may be low now, but the money is not free. Before the end of this decade, we will be paying more in interest and principal payments than the cost to run the operation. Debt service $109M, O&M $101 M in 2009-10. Even if the user fee is increased by$1-2/month over the next five years, the users still will have over$1.4 Billion in debt to pay back in 2012. By 2013 the principal payments will only have paid $342M while at the same time having paid $520M in interest. Reserves keep the system from floundering in the event of a disaster. OCSD is self insured to a great extent. The reserves keep the rates from increasing by more than $25/year by making interest on the money and not having to borrow more money. The reserves are less than 20% of the total CIP. Spending the reserves would do more harm than good. People can afford increasing their sewer user fees by$1-2/month. This is not onerous. This is not frivolous. This is not even the cost of one gallon of gasoline. This money has to be paid to maintain the world-class sewage system for which Orange County is rightly proud. Do not allow the system to become decrepit where leaks and breaks will destroy the integrity of the system and will cost us dearly in public approval as well as fines for regulatory problems. Approve the ordinance to set the user fee increase at 15% for the next five years. As a director, you must decide what is best for this organization as well as for your constituents. You control the destiny of OCSD. Sincerely, Randy T. Fuhrman 16915 Roundhill Drive Huntington Beach, CA 92649 (714) 377-4487 REQUEST TO ADDRESS THE BOARD OF DIRECTORS re Proposed Ordinance No. OCSD-20 All persons wishing to address the Board on proposed Ordinance No. OCSD-20 should complete and submit this form to the Board Secretary prior to commencement of the Board meeting. As determined by the Chair, speakers may be deferred until the specific item is taken for discussion. Remarks may be limited to three minutes or less. Any handouts (35 COPIES REQUIRED) must be given to the Board Secretary prior to the meeting for distribution. At this hearing, we will have the following procedure relative to persons addressing the Board. The Board received comments from many members of the public at its June 25th meeting. At tonight's public hearing, the Board will receive comments from persons who spoke at the June 25th hearing, only to the extent that their comments were not previously offered at the June 25th hearing. The Board will also receive comments from any new speaker who did not speak at the June 25th hearing. Persons who offered comments on June 25th and simply want to repeat those comments are not to present those comments again tonight. The Board Members already have that information in mind. PLEASE NOTE: Those persons who did not speak on June 25t" will be provided the opportunity to speak first. DATE: July 2, 2003 AGENDA ITEM NO. 8 NAME: (please print) HOME ADDRESS: (number/street) (city/zip code) TELEPHONE: ( ) REPRESENTING: (self/name of organization) 17 Memorandum To: Gary Streed CC: Mike White Carol Beekman Blake Anderson From: Angela Belt Date: 7/2/2003 Re: Rate Increase Notifications We received very few phone calls regarding the increase in the past week. The majority of them just wanted to know the outcome of the meeting on the 25 h. We have had 46 email responses and 12 responses by mail through June 24th.Please see attached for more breakdown of letters received by mail and email. We had 15 emails supporting the rate increase. •••• • • - • What • • • happens •• afterthe Specific Need more 5th year? JQuestion 'Information De ® • ------------ Los Alamitos IMP 0=0 III.F ME ®Mxlffl ------- ----- _ • 1 1 � /1 1 1 1 1 � 1 1 1 1 ----- • • Fill • .. .- 1 LETTERS Please indicate if these questions were asked? Opposed to Senior What Amount of Citizen or happens Property #of Increase or Fixed after the Specific Need more letters City Support Outraged Calculation Income Septic Tank 5th year? Question Information 11 Garden Grove 21 Garden Grove 3 Irvine 4 1 Newport Beach 5 Orange 6 Orange 7 Orange 8 Orange 9 Orange 10 Santa Ana 11 Santa Ana 12 Garden Grove TOTALS - - 9.001 1.001 1.00 - 1.00 - s T 3 7 I I 1 From 6/25/2003 to 7/2/2003 Public Correspondence 11:30 a.m. t�.8S1F�.u�.F�+Fir..r..c.err,+F+twv,7Frn*tKu+x+i9hvcfusronvya.a,.v.�.•,.w.r.,.v,v..�..w..n..an. ..,..�..............._... ...._.. .... ... _. . .Y. ..�.._.____ .. J 1 VLu1 1 J.u 1 1CLL1 Vage I of I Belt, Angela From: Miller, Joel Odmiller@uci.edu] Sent: Wednesday, July 02, 2003 9:20 AM To: Rates-Used for billing inquiries Subject: 5 Year, 15% Plan I'm in favor of the proposed 5 year, 15% rate plan that will be under consideration at the OCSD Board Meeting this evening. I believe that this plan will ensure a superior sewage collection and treatment system, and provide for a clean and safe ocean for coming generations. Thank you for your consideration. Joel D. Miller 2328 Bonnie Brae Santa Ana, CA 92706-1603 7/2/2003 Page 1 of 1 Belt, Angela From: Jose Hernandez Ulh010@yahoo.com] Sent: Wednesday, June 25, 2003 4:04 PM To: Rates - Used for billing inquiries Subject: Rate Increase I would like to go on record as against this rate increase. The proposed increase doubles the fees within 5 years, which is far too much. I would vote against it. Thank you for your time, Jose L. Hernandez 2402 N. Alona Santa Ana, CA 92706 Do you Yahoo!? SBC Yahoo! DSL -Now only$29.95 per month! 6/25/2003 11 • 'i �t t All Or - 1 l i � STATE OF CALIFORNIA) ) SS. COUNTY OF ORANGE ) Pursuant to California Government Code Section 54954.2, 1 hereby certify that the Notice and Agenda for thA gular Board Meeting of Orange County Sanitation District to be held on 2003, was duly posted for public inspection in the main lobby of the Districts' offices on /,�u � C� , 2003. IN WITNESS WHEREOF, I have hereunto set my hand this -)Z' day of , 2003. C Penny M. Kyle, Secr ary Board of Directors Orange County Sanitation District G:1WP.DTA\ADMIN\BS\FORMS\AGENDA CERTIFICATION.DOC