HomeMy WebLinkAbout2007-09 ADM MINUTES OF THE REGULAR MEETING OF
THE ADMINISTRATION COMMITTEE
Orange County Sanitation District
Wednesday, September 12, 2007, at 5:00 P.M.
A meeting of the Administration Committee of the Orange County Sanitation District was held on
September 12, 2007, at 5:00 p.m., in the Sanitation District's Administrative Office.
(2) Following the Pledge of Allegiance, a quorum was declared present, as follows:
ADMINISTRATION COMMITTEE STAFF PRESENT:
MEMBERS: Jim Ruth, General Manager
DIRECTORS PRESENT: Bob Ghirelli, Assistant General Manager
Mark Waldman, Chair Lorenzo Tyner, Director of Finance and
Phil Luebben, Vice Chair Administrative Services
Steven Choi Mike White, Controller
Bill Dalton Lille Kovac, Committee Secretary
Jon Dumitru Norbert Gaia
Joy Neugebauer Laurie Klinger
Chris Norby Jeff Reed
Ken Parker Juanita Skillman
Sal Tinajero Rich Spencer
Jim Winder
Rich Freschi OTHERS PRESENT:
Doug Davert, Board Vice Chair Brad Hogin, General Counsel
Jim Ferryman, Board Chair Ed Soong, PRAG
Victor Hsu, Fulbright&Jaworski, LLP
DIRECTORS ABSENT:
Darryl Miller ELL '' CQ
(3) APPOINTMENT OF CHAIR PRO TEM ORE OF
THjC6OUNTKI'B TTTq ON OSRTRDICT
No appointment was necessary.
(4) PUBLIC COMMENTS SEP 26 2007
There were no public comments. BY•
(5) REPORT OF THE COMMITTEE CHAIR
Chair Waldman did not give a report.
(6) REPORT OF THE GENERAL MANAGER
General Manager, Jim Ruth, did not give a report.
' Minutes of the Administration Committee
September 12, 2007
Page 2
(7) REPORT OF DIRECTOR OF FINANCE AND ADMINISTRATIVE SERVICES
Lorenzo Tyner, Director of Finance and Administration, provided a brief summary of various
department activities; i.e., Owner Controlled Insurance Program(OCIP); Treasury management;
investments, Comprehensive Annual Financial Report; staffing; Workers' Compensation
program; and Proposition 218 notices.
(8) REPORT OF GENERAL COUNSEL
Brad Hogin, General Counsel, reported on the current negotiations with the Department of
Education for the recovery of fair share of sewer fees for the last four years and future years.
(9) CONSENT CALENDAR ITEMS
Consideration of motion to approve all agenda items appearing on the Consent Calendar not
specifically removed from same, as follows:
a. MOVED, SECONDED AND DULY CARRIED: Approve minutes of the June 13, 2007
meeting of the Administration Committee.
b. ADM07-41 MOVED, SECONDED AND DULY CARRIED: Recommend to the Board
of Directors to adopt Resolution No. OCSD 07-_, Appointing
Representatives for the District to Act as Agents on Its Behalf in the Small
Claims Courts of Orange County Judicial Districts, and Repealing
Resolution No. OCSD 04-12.
C. Item pulled for discussion.
d. Item pulled for discussion.
e. ADM07-44 MOVED, SECONDED AND DULY CARRIED: Recommend to the Board
of Directors to adopt Resolution No. OCSD 07-_, Terminating the
California Public Entity Insurance Authority Joint Powers Agreement.
END OF CONSENT CALENDAR
f. ADM07-42 Director Davert requested clarification of methods available to ensure
payment of permit fees. It was then,
MOVED, SECONDED AND DULY CARRIED: Recommend to the Board
of Directors to approve the discharge of unoollectible debt owed by Expo-
Dyeing & Finishing in the amount of$151,370.36.
g. ADM07-43 Director Davert inquired about the possibility of securing debts for
accounts that have defaulted, and directed General Counsel to investigate
legal avenues.
Minutes of the Administration Committee
September 12, 2007
Page 3
MOVED, SECONDED AND DULY CARRIED: Recommend to the Board
of Directors to approve a Deferred Payment Agreement with Pacific
Ocean Dyeing & Finishing in the amount of$224,981.99, for the collection
of all charges and fees owed for sewer service charges and industrial
discharge permit fees,for a two-year period, plus interest of 10%per
annum.
(10) ACTION ITEMS
a. ADM07-45 MOVED, SECONDED AND DULY CARRIED: Recommend to the Board
of Directors to authorize issuance of up to$300 million in new fixed-rate
Certificates of Participation debt.
b. ADM0746 MOVED, SECONDED AND DULY CARRIED: (1)Approve a Consultant
Services Agreement with Fulbright&Jaworski, L.L.P., to provide bond
counsel services for a one-year period effective September 12, 2007, in a
form approved by General Counsel,with option to renew for four one-year
periods for an amount not to exceed$200,000 per year, and,
(2)Approve a 10% contingency per year($20,000).
C. ADM0747 MOVED, SECONDED AND DULY CARRIED: Recommend to the Board
of Directors to authorize the General Manager to procure bids for the
replacement of the Certificates of Participation Series 2006 Standby
Purchase Agreement.
(11) INFORMATIONAL ITEMS
a. ADM0748 Succession Management Program Update
Human Resources and Employee Relations Manager, Jeff Reed, briefly
reviewed the background and the history of the Succession Management
Program. Employee Relations Supervisor, Rich Spencer, and Laurie
Klinger, Human Resources Specialist, presented details of the program
and its projected timetable.
(12) CONVENE INCLOSED SESSION PURSUANT TO GOVERNMENT CODE SECTION
54957(b)(1).
There was no closed session.
(13) OTHER BUSINESS, COMMUNICATIONS OR SUPPLEMENTAL AGENDA ITEMS, IF
ANY
There were none.
(14) MATTERS WHICH A DIRECTOR MAY WISH TO PLACE ON A FUTURE AGENDA FOR
Minutes of the Administration Committee
September 12, 2007
Page 4
ACTION AND STAFF REPORT
There were none.
(15) FUTURE MEETING DATES
The next regular Administration Committee meeting is scheduled for October 10, 2007, at
5 p.m.
(16)ADJOURNMENT
The Chair declared the meeting adjourned at 5:35 p.m.
Submitted by:
Lilia Kovach
Committee Secretary
HAdepra9endaNdmin Commit e1090T091207 Administration Minut s.doc
' Distributed at the Fi ance &
Administration 0 �y
Meeting
September 12, 2007
MEMORANDUM
TO: Administration Committee
James D. Ruth, General Manager
FROM: Lorenzo Tyner
Director of Finance and Administrative Services
SUBJECT: Administrative Services Department Update
As there are items that are now posted directly to the Directors' Web-site or may not have been
directly discussed during Committee, I would like to take this opportunity to provide a summary
of some recent Administrative Services Department activities.
1) Owner Controlled Insurance Program (OCIP)
In June, staff presented the results of feasibility study and requested the release of a request for
proposals for an Owner Controlled Insurance Program (OCIP). An OCIP is a technique for
consolidating the Workers' Compensation insurance and general liability insurance coverages
for most participants in a construction program, thus underwriting the project itself, rather than
underwriting each of the individual companies participating.
The OCIP Feasibility Study is located within Director's website. Staff is currently in the process
of completing a formal bid process on the potential selection of an insurance broker(s)to broker
workers' compensation, general liability, and possible all risk property covering major selected
projects within the District's current ten-year$2 billion capital improvement program, and to
administer the OCIP. Staffs recommendation on this program will be presented to the
Administration Committee in October.
2) Treasury Management
Posted on the Director's website in August is the Consolidated Financial Report for the Fourth
Quarterly Ended June 30, 2007. Included in this report are the Quarterly Investment
Management Program Report, the Quarterly Interest Rate Exchange Agreement (Swap)
Monitoring Report, and the Quarterly Certificates of Participation Report. There were no
significant changes to these reports provided from previous reported quarters. The
fourth quarter financial review portion of this report will be presented in November along
with the audited Comprehensive Annual Financial Report.
3) Investments
Annually, staff prepares an Investment Policy manual that includes the investment policy, a
summary of the investment authorization, Treasury Management procedures, a certification
letter from the District's money manager, PIMCO, to abide by the investment policy, a copy of
the Board resolution authorizing the investment of funds, the quarterly investment program
monitoring report as of June 30th, and relevant sections of the California Government Code
pertaining to the investment of public funds. In July the Board readopted the District's
Investment policy for FY 2007-08 with no changes. This policy will be posted to the
Director's website.
4) Comprehensive Annual Financial Report
OCSD independent auditors have nearly completed their examination of the District's financial
statements for the year ended June 30, 2007. Each year the Administration Committee reviews
the results of the audit and corresponding Auditor's report to the Committee. Atpresent no
material weaknesses have been identified. The Auditor's full report will be presented at
the November Administration Committee meeting.
5) Groundwater Replenishment System (GWRS) Review
An independent audit firm has nearly completed its review of the GWRS. Preliminary findings
will be reviewed by the Committee Chair, selected Committee members and staff. The final
report will be presented to the Administration Committee at its October meeting.
6) Staffing
The Employment Status Report is posted monthly to the Directors Web-site.
For the period of March 2007 through September 2007, staffing has remained constant as
figures have averaged as follows:
Average number of new hires: 3 per month
Average number of separations: 4 per month
Average number of promotions: 3 per month
As part of the District's 2007.08 Budget, authorized staffing has been reduced by 10 Full-
Time Equivalent(FTE) from 644 to 634. All departments are managing their adjusted
resources accordingly.
2
7) Workers' Compensation
As a result of transition, administration of the District's Workers' Compensation program has
been temporarily transferred to the Human Resources Division.
As of August 31, 2007,total open claims equal 33, with a total cost of$1,775,541, a 10%
increase from the$1,616,597 reported in 2006. A more comprehensive report will
presented a later Committee meeting.
The 33 claims that are currently open include:
• 5 claims that are medical only;
• 6 claims that have all been denied and are in litigation;
• 6 claims that are in active treatment; and
• 14 claims that are in the settlement phase, 9 of which are pending future medical provisions.
8) Proposition 218 Notices
2007-08 is the final year of the 5-year approved rate program. Although exempted from public
vote of approval, California Proposition 218 requires the District to notify all property owners
upon its intent to raise Sewer Service Fee user charges. Staff will again be proposing a five-
year rate schedule due to the cost of mailing to 550,000 parcels. The rates are adopted through
the ordinance process, and that requires two Board meetings and a public hearing.
Proposition 218 Notices notify the property owners of the public hearing that coincides with the
second reading of the ordinance. Notices must be mailed to property owners 45 days before
the public hearing.
Based upon these requirements the adoption schedule is as follows:
Sewer Service User Fee Adoption Schedule 08-09
Present the 5-Year Rate Schedule to Administration Committee 2/13/2008
Prop 218 45-day notice mailed 4/11/2008
Board 1st reading of rate Ordinance 4/23/2008
Board 2nd reading &adoption of Ordinance 5/28/2008
Ordinance effective in 30 days 6/22/2007
Fiscal year begins 7/01/2008
Fees per parcel sent to Auditor/Controller 8/11/2008
A more detailed work plan will be presented as part of the 2008-09 Budget process.
If you have any questions or concerns regarding this information, please feel free to contact me.
3
STATE OF CALIFORNIA)
) SS.
COUNTY OF ORANGE )
Pursuant to California Government Code Section 54954.2, 1 hereby certify that
the Notice and the Agenda for the Administration Committee meeting to be held on
September 12, 2007, was duly posted for public inspection in the main lobby of the
District's offices on September 5, 2007.
IN WITNESS WHEREOF, I have hereunto set my hand this 5th day of
September, 2007.
Penny M. K e, Clerk of a Board
Board of Directors
Orange County Sanitation District
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ADMINISTRATION COMMITTEE
MEETING DATES
Meeting Date Board Meeting Dates
September 12, 2007 September 26, 2007
October 10, 2007 October 24, 2007
November 14, 2007 November 28, 2007
December 12, 2007 *December 19, 2007
January 2008 — Dark January 23, 2008
February 13, 2008 February 27, 2008
March 12, 2008 March 26, 2008
April 9, 2008 April 23, 2008
May 14, 2008 May 28, 2008
June 11, 2008 June 25, 2008
July 9, 2008 July 23, 2008
AUGUST DARK August 27, 2008
September 10, 2008 September 24, 2008
*Meetings being held the third Wednesday of the month.
ROLL CALL
ADMINISTRATION COMMITTEE
Finance, Human Resources and Information Technology
Meeting Date: September 12, 2007 Time: 5:00 p.m.
Adjourn:
COMMITTEE MEMBERS (14)
1 Mark Waldman Chair
Phil Luebben ice Chair
Steven Choi
Bill Dalton
Jon Dumitru
Rich Freschi
Darryl Miller
Joy Neu ebauer
Chris Norb
Ken Parker
Sal Tinajero
Jim Winder
James M. Ferryman Board Chair
Doug Davert Board Vice Chair
OTHERS
Brad Ho in, General Counsel
STAFF
Jim Ruth, General Manager
Bob Ghirelli, Assistant General Manager
Nick Arhontes, Director of Operations& Maint.
Jim Herberg, Director of Engineering
Ed Torres, Director of Technical Services
Lorenzo Tyner, Director of Finance and
Administrative Services
Lilia Kovac, Committee Secretary
Jeff Reed, Human Resources and Employee
Relations Manager
Mike White, Controller
H:Wept�gendaMmin Commitlee�OWIA02.Rail Call.da
AGENDA
REGULAR MEETING OF THE
ADMINISTRATION COMMITTEE
ORANGE COUNTY SANITATION DISTRICT
WEDNESDAY, SEPTEMBER 12, 2007, AT 5:00 P.M.
ADMINISTRATIVE OFFICE
10844 Ellis Avenue
Fountain Valley, California 92708
www.ocsd.com
(1) PLEDGE OF ALLEGIANCE
(2) DECLARATION OF QUORUM
(3) APPOINTMENT OF CHAIR PRO TEM, IF NECESSARY
(4) PUBLIC COMMENTS
(5) REPORT OF COMMITTEE CHAIR
(6) REPORT OF GENERAL MANAGER
(7) REPORT OF DIRECTOR OF FINANCE AND ADMINISTRATIVE SERVICES
(8) REPORT OF GENERAL COUNSEL
(9) CONSENT CALENDAR ITEMS
Consideration of motion to approve all agenda items appearing on the Consent Calendar not
specifically removed from same, as follows:
a. Approve minutes of the June 13, 2007 meeting of the Administration Committee.
Book Page I
September 12, 2007 Page 2
b. ADM07-41 Recommend to the Board of Directors to adopt Resolution No. OCSD 07- ,
Appointing Representatives for the District to Act as Agents on its Behalf in
the Small Claims Courts of Orange Countv Judicial Districts, and Repealing
Resolution No. OCSD 04-12. (Book Page 10)
C. ADM07-42 Recommend to the Board of Directors to approve the discharge of
uncollectible debt owed by Expo-Dyeing & Finishing in the amount of
$151,370.36. (Book Page 13)
d. ADM07-43 Recommend to the Board of Directors to approve a Deferred Payment
Agreement with Pacific Ocean Dyeing & Finishing in the amount of
$224,981.99, for the collection of all charges and fees owed for sewer
service charges and industrial discharge permit fees, for a two-year period,
plus interest of 10% per annum. (Book Page 14)
e. ADM07-44 Recommend to the Board of Directors to adopt Resolution No. OCSD 07-_,
Terminating the California Public Entity Insurance Authority Joint Powers
Agreement. (Book Page 16)
END -F CONSENT CALF DAR
f. Consideration of items deleted from Consent Calendar, if any.
(10) ACTION ITEMS
a. ADM07-45 Recommend to the Board of Directors to authorize issuance of up to$300
million in new fixed-rate Certificates of Participation debt. (Book Page 20)
b. ADM07-46 (1)Approve a Consultant Services Agreement with Fulbright&Jaworski,
L.L.P., to provide bond counsel services for a one-year period effective
September 12, 2007, in a form approved by General Counsel, with option to
renew for four one-year periods for an amount not to exceed $200,000 per
year; and,
(2)Authorize a 10% contingency per year($20,000). (Book Page 23)
C. ADM07-47 Recommend to the Board of Directors to authorize the General Manager to
procure bids for the replacement of the Certificates of Participation Series
2006 Standby Purchase Agreement. (Book Page 26)
(11) INFORMATIONAL ITEMS
a. ADM07-48 Succession Management Program Update (Book Page 28)
Book Page 2
September 12, 2007 Page 3
(12) CLOSED SESSION
Dudng the course of conducting iha business set forth oh this agenda as a regulermeeting of the Cornmiltee,
the Chair may convene the Committee in closed session to consider matters of pending real estate negotiations,
pending or potential litigation,or personnel matters,pursuant to Government Code Sections 64956.8, 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)
employee actions or negotiations with employee representatives; or which are exempt from public disclosure i
under the California Public Records Ad, may be reviewed by the Committee during a permitted dosed session
i and are not available for public inspection. At such time as final actions are taken by the Committee on any of
y,thew subjects,the minutes will raged all required diadoaures of irdormetion.
__. _. _._ ................_.__.__.._____._......__.._.._._........._........,..__..i
a. Convene in closed session.
b. Reconvene in regular session.
c. Consideration of action, if any, on matters considered in closed session.
(13) OTHER BUSINESS, COMMUNICATIONS OR SUPPLEMENTAL AGENDA ITEMS, IF ANY
(14) MATTERS WHICH A DIRECTOR MAY WISH TO PLACE ON A FUTURE AGENDA
FOR ACTION AND STAFF REPORT
(15) FUTURE MEETING DATES
The next regular Administration Committee meeting is scheduled for October 10, 2007, at
5 P.M.
(16) ADJOURNMENT
Book Page 3
September 12, 2007 Page 4
Agenda Posting: 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
dale and time above. All written materials relating to each agenda item are available for public inspection in the office
of the Clerk of the Board.
Items Not Posted: In the event any matter not listed on this agenda is proposed to be submitted to the Committee for
discussion and/or action, it will be done in compliance with Section 54954.2(b) as an emergency item or because
there is a need to take immediate action, which need came to the attention of the Committee subsequent to the
posting of agenda, or as set forth on a supplemental agenda posted in the manner as above, not less than 72 hours
prior to the meeting date.
Public Comments: Any member of the public may address the Administration Committee on specific agenda items or
matters of general interest. As determined by the Chair, speakers may be defamed until the specific item is taken for
discussion and remarks 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 Committee except as authorized by Section 54954.2(b).
Consent Calendar: All matters placed on the consent calendar are considered as not requiring discussion or further
explanation, and unless a particular item is requested to be removed from the consent calendar by a Director of staff
member,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.
The Committee Chair will determine if any items are to be deleted from the consent calendar.
Items Continued: Items may be continued from this meeting without further notice to a Committee meeting held
within five(5)days of this meeting per Government Code Section 54954.2(b)(3).
Meeting Adioumment: This meeting may be adjourned to a later time and items of business from this agenda may be
considered at the later meeting by Order of Adjournment and Notice in accordance with Government Code Section
54955(posted within 24 hours).
Accommodations for the Disabled: The Board of Directors Meeting Room is wheelchair accessible. If you require
any special disability related accommodations, please contact the Orange County Sanitation District Clerk of the
Board's office at(714) 593-7130 at least 72 hours prior to the scheduled meeting. Requests must specify the nature
of the disability and the type of accommodation requested.
Notice to Committee Members:
For any questions on the agenda or to place any items on the agenda,Committee members should contact the Committee Chair
or Clerk"a Board ten days in advance of the Committee meeting.
Committee Chair: Mark Waldman (714)827-1969
Committee Secretary: Lilia Kovac (714)593-7124 Ikovac0orsd.mm
General Manager: Jim Ruth (714)593-7110 irulh�ocsd.mm
Assistant General Manager Bob Ghirelli (714)593-7400 rghirelli4ocsd.mm
Director of Finance and Lorenzo Tyner (714)593-7550 ItvnenWocsd.mm
Administrative Services
Human Resources and Employee Jeff Reed (714)593-7144 ireed/o3ocstl.mm
Relations Manager
H:WeptlagendMAdmin Commlaee10907103.091207 Adminisimtion Agenda.dac
Book Page 4
September 12, 2007
ADMINISTRATION COMMITTEE
AGENDA CALENDAR
Item Action
October GWRS External Review Information
October ARBA Update Information
November Receive and File Comprehensive Annual Financial Action
Report
CAFR
Book Page 5
MINUTES OF THE REGULAR MEETING OF
THE ADMINISTRATION COMMITTEE
Orange County Sanitation District
Wednesday,June 13, 2007, at 5:00 P.M.
A meeting of the Administration Committee of the Orange County Sanitation District was held on
June 13, 2007, at 5:00 p.m., in the Sanitation District's Administrative Office.
(1) The roll was called and a quorum declared present, as follows:
ADMINISTRATION COMMITTEE STAFF PRESENT:
MEMBERS: Jim Ruth, General Manager
DIRECTORS PRESENT: Bob Ghirelli,Assistant General Manager
Mark Waldman, Chair Lorenzo Tyner, Director of Finance and
Phil Luebben,Vice Chair Administrative Services
Steven Choi Mike White, Controller
Bill Dalton Lilia Kovac, Committee Secretary
Jon Dumitru Norbert Gala
Joy Neugebauer Randy Kleinman
Chris Norby Juanita Skillman
Sal Tinajero
Jim Winder OTHERS PRESENT:
Rich Freschi Brad Hogin, General Counsel
Darryl Miller Ron Karich, Karich &Assoc.
Doug Davert, Board Vice Chair Don McLean, Driver-Alliance
DIRECTORS ABSENT:
Ken Parker
Jim Ferryman, Board Chair
(2) APPOINTMENT OF CHAIR PRO TEM
No appointment was necessary.
(3) PUBLIC COMMENTS
There were no public comments.
(4) REPORT OF THE COMMITTEE CHAIR
Chair Waldman did not give a report.
Book Pne 6
Minutes of the Administration Committee
June 13, 2007
Page 2
(5) REPORT OF THE GENERAL MANAGER
General Manager, Jim Ruth, did not give a report.
(6) REPORT OF DIRECTOR OF FINANCE AND ADMINISTRATIVE SERVICES
Lorenzo Tyner, Director of Finance and Administration, did not give a report.
(7) REPORT OF GENERAL COUNSEL
Brad Hogin, General Counsel, did not give a report.
(8) CONSENT CALENDAR ITEMS
Consideration of motion to approve all agenda Items appearing on the Consent Calendar not
specifically removed from same, as follows:
a. MOVED, SECONDED AND DULY CARRIED: Approve minutes of the May 9, 2007
meeting of the Administration Committee.
b. ADM07-35 MOVED, SECONDED AND DULY CARRIED: Recommend to the Board
of Directors to approve the release of a request for proposal for the
administration of an Owner Controlled Insurance Program, Specification
No. CS-2007-347, covering the Sanitation District's $2.5 billion capital
improvement program.
C. ADM07-36 MOVED, SECONDED AND DULY CARRIED: Recommend to the Board
of Directors to renew the District's Excess Workers' Compensation
Insurance for the period July 1, 2007 through June 30,2008 with the
California State Association of Counties Excess Insurance Authority
("CSAC EIA"), in an amount not to exceed $0.003018 per dollar of actual
payroll.
d. ADM07-37 MOVED, SECONDED AND DULY CARRIED: Recommend to the Board
of Directors to renew the District's All-Risk Property, Flood, and Boiler&
Machinery Insurance Program ("Property Insurance")for the period July 1,
2007 through June 30, 2008, in an amount not to exceed $585,630.
e. ADM07-38 MOVED, SECONDED AND DULY CARRIED: Recommend to the Board
of Directors to renew the District's Excess General Liability Insurance
Program for the period July 1,2007 through June 30, 2008, in an amount
not to exceed $367,366.
END OF CONSENT CALENDAR
Book Page 7
Minutes of the Administration Committee
June 13, 2007
Page 3
(9) ACTION ITEMS
a. ADM07-39 MOVED, SECONDED AND DULY CARRIED: Recommend to the Board
of Directors to adopt Resolution No. OCSD 07-XX, Establishing Use
Charges for the 2007-08 Fiscal Year Pursuant to the Wastewater
Treatment and Disposal Agreement with the Santa Ana Watershed
Project Authority("SAWPA").
b. ADM07-40 Lorenzo Tyner, Director of Finance and Administrative Services,
briefly presented the proposed budget update and recommended
adjustments to the adopted budget.
MOVED, SECONDED AND DULY CARRIED: Recommend to the
Board of Directors to approve the proposed revisions to the
Operating, Capital, Debt/COP Service and Self-Insurance Budgets
for FY 2007-08, as follows:
Originally Proposed
Adopted Revised
Budget Budget
FY 2007-08 FY 2007-08
Net Operations, Maintenance&Working Capital $135,602,130 $139,973,400
Worker's Compensation Self Insurance 559,400 559,400
General Liability and Property Self-Insurance 2,055,200 2,055,200
Net Capital Improvement Program 338,818,000 302,714,000
Debt/COP Service 65,462,000 65,273,720
Other Requirements 2,645,300 2,645,300
TOTAL $645,142,030 $513,221,020
(10) INFORMATIONAL ITEMS
There were none.
(11) CONVENE IN CLOSED SESSION PURSUANT TO GOVERNMENT CODE SECTION
54957(b)(1). The Committee convened in Closed Session at 5:17 p.m. pursuant to
Government Code Section 54957. Confidential Minutes of the Closed Session held by
the Administration Committee have been prepared in accordance with California
Government Code Section 54957(b)(1),and are maintained by the Clerk of the Board in
the Official Book of Confidential Minutes of Board and Committee Closed Meetings.
RECONVENE IN REGULAR SESSION: The Committee reconvened in regular session
at 5:23 p.m.
Book Page 8
Minutes of the Administration Committee
June 13, 2007
Page 4
(12) OTHER BUSINESS, COMMUNICATIONS OR SUPPLEMENTAL AGENDA ITEMS, IF
ANY
There were none.
(13) MATTERS WHICH A DIRECTOR MAY WISH TO PLACE ON A FUTURE AGENDA FOR
ACTION AND STAFF REPORT
There were none.
(14) FUTURE MEETING DATES
The next regular Administration Committee meeting is scheduled for July 11, 2007, at 5 p.m.
(15) ADJOURNMENT
The Chair declared the meeting adjourned at 5:25 p.m.
Submitted by: `
C� `, _Y�46�U-ri.C�•
Lille Kovac
Committee Secretary
Hddep0agendaVWmin Commlff eWgOn05.061307 AdminisbaWn mtnut s.doc
Rook Page 9
ADMINISTRATION COMMITTEE Meeilng Date To Bd.of Dir.
09/12/07 09/26/07
AGENDA REPORT [AD IemNumbe
ADMO741o741
Orange County Sanitation District
FROM: James D. Ruth, General Manager
Originator: Lorenzo Tyner, Director of Finance and Administrative Services
SUBJECT: ADOPT RESOLUTION APPOINTING REPRESENTATIVES OF OCSD
TO ACT AS AGENTS ON ITS BEHALF IN THE SMALL CLAIMS
COURTS OF ORANGE COUNTY JUDICIAL DISTRICTS, AND
REPEALING RESOLUTION NO. OCSD 04-12
GENERAL MANAGER'S RECOMMENDATION
Adopt Resolution No. OCSD 07-_, Appointing Representatives for the District to Act as
Agents on its Behalf in the Small Claims Courts of Orange County Judicial Districts, and
Repealing Resolution No. OCSD 04-12.
SUMMARY
The Sanitation District's list of appointed representatives who act as agents on it's
behalf in Orange County Small Claims Courts has not been updated since 2004.
Adoption of this Resolution will update that list and appoint current Administrative
Services and Financial Management Division employees to serve as District
Representatives.
PRIOR COMMITTEEIBOARD ACTIONS
• Resolution No. OCSD 04-12 was passed and adopted at an adjourned regular
meeting on April 28, 2004.
• Resolution No. OCSD 98-27 was passed and adopted at a Special Meeting on
July 1, 1998.
ADDITIONAL INFORMATION
None
ATTACHMENT
Proposed Resolution No. OCSD 07-_
JDR:LT:MW
Farm NO.OW102.3 RwIUE:PWI137
Page 1
Book Page 10
RESOLUTION NO. OCSD 07-
APPOINTING REPRESENTATIVES TO ACT AS OCSD
AGENTS IN SMALL CLAIMS COURTS
A RESOLUTION OF THE BOARD OF DIRECTORS OF
ORANGE COUNTY SANITATION DISTRICT APPOINTING
REPRESENTATIVES FOR THE DISTRICT TO ACT AS
AGENTS ON ITS BEHALF IN THE SMALL CLAIMS
COURTS OF ORANGE COUNTY JUDICIAL DISTRICTS,
AND REPEALING RESOLUTION NO. OCSD04-12
WHEREAS, the Board of Directors deems it necessary to periodically commence
legal action in the Small Claims Courts to collect debts owing to the District; and,
WHEREAS, legal proceedings in the Small Claims Courts must be filed on a
continuing, periodic basis; and,
WHEREAS, the rules of court provide that attorneys shall not be allowed to
appear and represent parties to these proceedings; and,
WHEREAS, it is necessary to appoint agents for the District to act for and on its
behalf in the Small Claims Courts of four of the Orange County Judicial Districts.
NOW, THEREFORE, the Board of Directors of Orange County Sanitation
District,
DOES HEREBY RESOLVE, DETERMINE AND ORDER:
Section 1: That those persons set forth on "Exhibit A"to this Resolution are
appointed to represent and appear for the District on any and all claims filed in the
Small Claims Courts of the West Orange County Judicial District, the North Orange
County Judicial District, the Central Orange County Judicial District, and the Orange
County Harbor Judicial District.
PASSED AND ADOPTED at a regular meeting held September 26, 2007.
Chair
ATTEST:
Clerk of the Board
Book Page I I
EXHIBIT A
RESOLUTION NO. OCSD 07-
Angela Brandt
Danny L. Dillon
Robert Geggie
Lorenzo Tyner
Michael D. White
Book Page 12
ADMINISTRATION COMMITTEE MeetlnBDate Ta Bd.of Dir.
09/1y07 By/Zahn
AGENDA REPORT t Number Bem NUmbff
nDM07-42
Orange County Sanitation District
FROM: James D. Ruth, General Manager
Originator: Lorenzo Tyner, Director of Finance and Administrative Services
SUBJECT: DISPOSITION OF UNCOLLECTIBLE DEBT— EXPO DYEING & FINISHING
GENERAL MANAGER'S RECOMMENDATION
Approve the discharge of uncollectible debt owed by Expo-Dyeing & Finishing in the
amount of$151,370.36.
SUMMARY
In April 2004, Expo-Dyeing & Finishing filed for Chapter 11 Bankruptcy. At that time,
the Sanitation District had an unsecured claim against Expo-Dyeing & Finishing in the
amount of$181,780 for outstanding permittee fees consisting of$178,881 on a deferred
payment agreement, and $2,899 on an unpaid balance owed from the FY 03-04 third-
quarter permittee invoice.
In September 2005, the Bankruptcy Court approved the Chapter 11 Reorganization that
had been previously approved by the creditors. As part of this process, the debtor
challenged the Sanitation District's claim of$181,780, and the Court lowered the
acceptable amount to only the amount owed on the deferred payment agreement, or
$178,881. The Chapter 11 Reorganization plan called for payment of seventeen
percent of all outstanding debts. Thus, the outstanding debt owed to OCSD by Expo-
Dyeing was reduced by the Bankruptcy Court to $30,410, or a reduction of$151,370
from the original amount owed of$181,780. Of this remaining outstanding obligation of
$30,410 owed by Expo-Dyeing & Finishing, the Sanitation District has received $9,837
as of June 30, 2007 with the remaining balance to be received in future quarterly
payments in accordance with the terms of the Chapter 11 Reorganization Plan. Staff is
recommending that the Board approve the discharge of$151, 370 in accordance with
the Chapter 11 Reorganization plan approved by the Bankruptcy Court.
PRIOR COMMITTEE/BOARD ACTIONS
N/A
ADDITIONAL INFORMATION
None.
JDR:LT:MW
FOIn No.Ouulve.a R�:MIM7
Page 1
Book Page 13
ADMINISTRATION COMMITTEE Meeting Date To Bd.of Dir.
09/12/07 09/26/07
AGENDA REPORT Item Nomber Rem Number
ADM0743
Orange County Sanitation District
FROM: James D. Ruth, General Manager
Originator: Lorenzo Tyner, Director of Finance and Administrative Services
SUBJECT: DEFERRED PAYMENT AGREEMENT FOR CHARGES AND FEES
OWED BY ONE INDUSTRIAL WASTEWATER DISCHARGE
PERMITTEE
GENERAL MANAGER'S RECOMMENDATION
Approve a Deferred Payment Agreement with Pacific Ocean Dyeing & Finishing in the
amount of$224,981.99, for the collection of all charges and fees owed for sewer service
charges and industrial discharge permit fees, for a two-year period, plus interest of 10%
per annum.
SUMMARY
Pacific Ocean Dyeing & Finishing is a holder of an industrial wastewater discharge
permit issued by the Sanitation District that requires the payment of sanitary sewer
service charges and industrial discharge permit fees for the cost of conveying, treating
and disposing of wastewater discharged. Based on the terms of the permit, the
permittee is required to pay estimated quarterly sewer service charges that are
reconciled annually with actual discharge flows and levels of biochemical oxygen
demand and total suspended solids. The permittee is now in default of their payment
obligations and the General Manager, in accordance with Resolution No. OCSD 98-23,
Article III, "Collection of Fees and Charges Relating to Industrial Waste Dischargers,"
may negotiate a deferred payment agreement with this permittee requiring monthly
payment terms plus interest.
In April 2004, the Sanitation District entered into a deferred payment agreement with
Pacific Ocean Dyeing & Finishing (formerly Y2K Textile) in the amount of$203,013.54
plus interest and administrative charges for delinquent obligations. The permittee paid
the agreement in full by March of 2006.
As of February of 2007, the permittee became delinquent on new obligations. This
delinquency has now risen to $224,981.99. The Sanitation District received a letter in
June 2007, requesting a two-year deferred payment agreement on this total current
obligation. The interest rate that would be used for this deferred payment agreement is
10%.
F000 No.owtoia pwtiee:aYpvW
Page 1
Book Page 14
PRIOR COMMITTEE/BOARD ACTIONS
In April 2004, the Board approved a deferred payment agreement with Pacific Ocean
and Dyeing & Finishing in the amount of$203,013.54 plus interest and administrative
charges for delinquent obligations.
ADDITIONAL INFORMATION
N/A
JDR:LT:MW
Form No.GW 1= Fn'bea:uw1Nt
Page 2
Book Page 15
ADMINISTRATION COMMITTEE M:n9 Dare TUBd.or Dlr.
09/12/07 09126/07
AGENDA REPORT 11 mNumber Item Number
ADM07-99
Orange County Sanitation District
FROM: James D. Ruth, General Manager
Originator: Lorenzo Tyner, Director of Finance and Administrative Services
SUBJECT: TERMINATION OF THE CALIFORNIA PUBLIC ENTITY INSURANCE
AUTHORITY ("CPEIA")
GENERAL MANAGER'S RECOMMENDATION
Adopt Resolution No. OCSD 07-_, Terminating the California Public Entity Insurance
Authority Joint Powers Agreement.
SUMMARY
OCSD participated for several years in California Public Entity Insurance Authority
(CPEIA) as a member agency, purchasing workers' compensation insurance coverage.
Because the CSAC Excess Insurance Authority had originally allowed only counties as
members, CPEIA was created as a sister Joint Powers Authority in 2001 to allow non-
county public agencies access to the CSAC Excess Insurance Authority's programs.
CPEIA has been considered a component part of the CSAC Excess Insurance
Authority. Due to CPEIA's growth and the desire of CPEIA members to have a greater
voice in CSAC Excess Insurance Authority decisions, a restructuring has occurred
whereby CPEIA members have become members of the CSAC Excess Insurance
Authority, and have been given a voice in the business affairs of the CSAC Excess
Insurance Authority. CPEIA, therefore, no longer has a reason for existence.
The CSAC Excess Insurance Authority is the largest property/liability insurance risk pool
in the country. The OCSD Board has previously approved the merger of CPEIA and
CSAC EIA.
PRIOR COMMITTEE/BOARD ACTIONS
In July 2003 the Board approved and the Board chair signed the Joint Powers
Agreement creating the California Public Entity Insurance Authority and the CPEIA
MOU for the Excess Workers Compensation Program.
Fom No.0W 10 rgmm ReyA-ran
Dq 151 Revlx101/, 7
Page 1
Book Page 16
In March 2007 the Board approved and the Board chair signed the CSAC EIA Joint
Powers Agreement superseding the CPEIA and the CSAC EIA MOU for the Excess
Workers Compensation Program.
ADDITIONAL INFORMATION
Not applicable.
ATTACHMENTS
Proposed Resolution No. OCSD 07
JDR:LT:MW
Form NO.OMIV2 AOontle Ra -FM
Dept 151 Roi .017 7
Page 2
Book Page 17
RESOLUTION NO. OCSD 07-
A RESOLUTION OF THE BOARD OF DIRECTORS OF
ORANGE COUNTY SANITATION DISTRICT
TERMINATING THE CALIFORNIA PUBLIC ENTITY
INSURANCE AUTHORITY JOINT POWERS AGREEMENT
WHEREAS, the CSAC Excess Insurance Authority (EIA) and the California
Public Entity Insurance Authority (CPEIA) have merged into one organization, the EIA,
and there is no need for the CPEIA to continue to exist; and,
WHEREAS, CPEIA members are able to join the EIA as public entity members;
and,
WHEREAS, pursuant to Article 22 of the CPEIA Joint Powers Agreement
(Agreement) the affirmative vote of the governing bodies of three-fourths of the
members are required to terminate the Agreement; and,
WHEREAS, there are no assets or other property to distribute under Article 22 of
the Agreement.
NOW, THEREFORE, the Board of Directors of Orange County Sanitation
District,
DOES HEREBY RESOLVE, DETERMINE AND ORDER:
Section 1: That pursuant to the provisions of Article 22 of the Agreement it
elects to terminate the CPEIA. Said termination shall become effective upon the
affirmative vote of the Orange County Sanitation District Board of Directors of three-
fourths of the members.
PASSED AND ADOPTED at an adjourned regular meeting held
September 26, 2007.
Chair
ATTEST:
Clerk of the Board
Book Page 18
CSAC EXCESS
INSURANCE AUTHORITYJsko�k
A Public Agency
ACTION REQUESTED BY DECEMBER 31, 2007 J
To: Members, California Public Entity Insurance Authori ty
From: Michael Fleming, Chief Executive Officer
Subject: Termination of CPEIA
As you know, the transition of the CPEIA members into the CSAC EIA has been in
progress for the past year and a half. 1 am pleased to report that as of June 30, 2007,
all CPEIA members executed the appropriate documents to join the CSAC EIA direct.
The last phase of the transition plan is the termination of the CPEIA as an entity. At its
meeting on May 29, 2007, the CPEIA BoaW o Ire ors oo c Ion o Ina a the
contractual agreement between the CSAC EIA and the CPEIA effective July 1, 2007.
Now the CPEIA members, acting through their governing Hoards, must take action to
terminate theCPEIA Joint Powers Agreement. The CPEIA will be officially terminated
upon approval by three-fourths of the CPEIA members. With 134 CPEIA members,
approval is needed by 101 governing boards to effect the termination. In order to
conclude the business of the CPEIA, we encourage each member to present a
resolution to their governing board to document their action to terminate the CPEIA
(sample resolution enclosed) as soon as possible and before December 31, 2007.
The CPEIA has no assets to distribute and no programs of the CPEIA were ever
established. Therefore, there should be no pending issues following approval to
terminate by three-fourths of the members. To reference the provisions in the CPEIA
Joint Powers Agreement, please visit the ETA's website at www.csac-eia.org and click
on the"Latest News" article regarding this topic. You can also obtain a Word version of
the sample resolution in this area of the website.
Upon action by your governing board, please send the executed resolution to the EIA
office. If you have any questions, please feel free to contact me or Gina Dean at the
EIA or your broker at Alliant Insurance Services.
Enclosure
cc: Alliant Insurance Services
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ADMINISTRATION COMMITTEE Ong D+� ro B'io DU.
09/wW o9�:s1W
AGENDA REPORT Item NUMM rtan Numbe
ADMOMS
Orange County Sanitation District
FROM: James D. Ruth, General Manager
Lorenzo Tyner, Director of Finance and Administrative Services
SUBJECT: PROPOSAL FOR ISSUING UP TO $300 MILLION IN NEW CERTIFICATES OF
PARTICIPATION
GENERAL MANAGER'S RECOMMENDATION
Authorize issuance of up to $300 million in new fixed-rate Certificates of Participation
debt.
SUMMARY
Approval of the recommended action above will direct staff to begin the $300 million
fixed-rate competitive debt issuance process utilizing the assistance of the financial
advising firm of Public Resources Advisory Group, and the bond counsel firm of
Fulbright& Jaworski.
In accordance with the Sanitation District's Board-adopted Debt Policy, the District will
restrict long-term borrowing to capital improvements that cannot be financed from
current revenue. This policy will assist in the leveling out of user fee rates over time and
avoid any spiked increases in the short-term-
PRIOR COMMITTEEIBOARD ACTIONS
In support of the Sanitation District's Strategic Plan capital improvement program, the
Board approved the issuance of$300 million of new Certificates of Participation (COP)
debt within the FY 2006-07 Adopted Budget.
ADDITIONAL INFORMATION
The Sanitation District currently has six series of non-subordinate COPS outstanding,
comprising a total par amount of$784.1 million. The following table describes each
COP in detail.
Form No. u1023 pMyy;p 1M7
Page 1
Book Page 20
EXISTING COP FINANCING PROGRAM
i Outgtafitling'
Par Amount ' t'I q9 h�_ !
Series 2007A $95,180,000 Fixed Rate
Refunding (4)
Series 2006 196,600,00 Deily Variable Rate
Series 2003 191,500,00 Fixed Rate
Series 2000 Refunding(t) 196,800,00 Daily Variable Rate
Series 1993 Refunding m 26,900,00 Synthetic Fixed Rate I'I
Series 1992 Refunding(2) 77,340,00 Synthetic Fixed Rate P1
Total $784,120,000
'As of September 1,2007.
(1)Series 2000 COPS refunded the Series A,B,and C issued between 1990 and 1992,
(2)Series 1992 and 1993 COPS refunded the Series 1986 and a portion of the Series'B'COPS.
(3)Variable rate debt swapped to a fixed rate through maturity.
(4)Series 2007A COPS refunded$88.5 million portion of Series 2003.
The Series 2000 refunded the $179.7 million outstanding principal balance of the
1990-92 Series A, B, and C COPS and reimbursed the Sanitation District for
improvements made to the wastewater treatment system. The 1993 Refunding COPS
was issued to refund $39.7 million of the Series "B" COPS. The Series 1992 Refunding
COPS refunded the 1986 COPs ($107 million) issued on behalf of District Nos. 1, 2, and
3. The 1992 Refunding COPS also refunded approximately$38.4 million of the Series
"B" COPs, issued in 1991. Series 2003 and 2006 were both new money debt
issuances. The Series 2007A refunded a portion of the Series 2003.
The following table displays the combined gross debt service cash flows for the
Sanitation District's six COPs through final maturity in FY 2035-36.
DEBT SERVICE STRUCTURE
80
70 D Variable Rate
g 60 ■Fixed 8 Synthetic Find Rate
50
40
30
20
10
0
N O N Y b 0 O N Y a) t0 O N Y t0
O O O O O O O O O O O O O O O
N N N N N N N N N N N N N N N
Fiscal Year End
Fa No.UWIM RWW MOW
Page 2
Rook Page 21
As shown above and in accordance with the Sanitation District's debt policy, the District
currently has $393.2 million in variable rate debt outstanding and $390.9 million in fixed
rate (and synthetic fixed rate) debt outstanding. However, the policy also restricts the
issuance of new variable rate debt that will exceed the level of available invested
reserves, which is $301.3 as of June 30, 2007. In order to remain in compliance with
the District's debt policy, this proposed $300 million COP new money debt issue will be
a fixed rate debt issuance. Staff is also proposing to issue this $300 million fixed rate
debt has in a competitive sale as opposed to a negotiated sale due to PRAG's opinion
that a competitive fixed rate sale will enable the Sanitation District to receive funds by
the end of the calendar year and likely be less costly to the District.
JDR:LT:MW
Form Na.OWIDT9 Fw'tl0G'.0=1107
Page 3
Book Page 22
ADMINISTRATION COMMITTEE Mcebng ogre TO Bd.of Dlr.
09 ID07
-
AGENDA REPORT tADNumber Rem Numhe
ArxnD7 as
Orange County Sanitation District
FROM: James D. Ruth, General Manager
Lorenzo Tyner, Director of Finance and Administration
Originator: Mike White, Controller
SUBJECT: SELECTION OF BOND COUNSEL
GENERAL MANAGER'S RECOMMENDATION
(1)Approve a Consultant Services Agreement with Fulbright&Jaworski, L.L.P., to
provide bond counsel services for a one-year period effective September 12, 2007, in a
form approved by General Counsel, with option to renew for four one-year periods, for
an amount not to exceed $200,000 per year; and,
(2) Authorize a 10% contingency per year ($20,000).
SUMMARY
The Sanitation District is scheduled to issue $1.15 billion in "new money" debt over the
next seven years to assist with the funding of the ten-year $2.5 billion CIP. In managing
this effort and to be able to move quickly in order to take advantage of changes in the
economy, staff is developing a debt financing team that includes the professional
services of a financial advisor, bond counsel, and underwriters. In October 2006, the
FAHR Committee and Board approved a five-year contract extension with Public
Resources Advisory Services (PRAG) to serve as the Sanitation District's financial
advisors. We currently utilize the services of UBS and Bear Stearns serving as
remarketing agents on our outstanding variable rate issues, and staff plans to continue
utilizing request (RFP) for proposals of underwriters for each new proposed negotiated
debt issue. The Sanitation District has used the same bond counsel for the last 14
years, and staff has had to negotiate sole source service and fees and seek the Board's
approval each time a new financing opportunity has become available. Staff believes it
is now a good time to re-evaluate these services and has completed a competitive bid
process for bond counsel services on all debt issues to be made over the next five
years. Again, by having a debt financing team in place, the Sanitation District will be
able to move quickly in the future to capture any changes in market conditions as it
relates to the District's debt program.
Based on recent debt financing experience, 8 bond counsel firms with a presence in
California were solicited for bids. Four firms responded with proposals, and the top two
firms were interviewed for final consideration. After the completion of this process,
Fulbright & Jaworski is being recommended for selection to serve as the Sanitation
District's bond counsel. This proposed selection is for a one-year period with the
Director of Finance and Administrative Services right to renew for up to four additional
years.
Fom,No.DW 102] RW.U VOW
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Book Page 23
PRIOR COMMITTEEIBOARD ACTIONS
N/A
ADDITIONAL INFORMATION
Orrick, Herrington & Sutcliffe (Orrick) served as the Sanitation District's bond counsel on
the past five certificates of participation (COP) debt financings dating back to 1993.
Most recently, they were bond counsel for the COP debt issues of 2000, 2003, 2006,
and the COP refunding in May of 2007. Each time there has been a need for a new
debt financing, staff has negotiated services and fees with Orrick and solicited approval
of a sole source selection of bond counsel services from the Board. This practice is
time consuming and changes in the market place sometime require the District to move
more quickly in order to take advantage of these opportunities. This competitive bid
process will allow the Sanitation District to lock in the best services available at the most
competitive price for a five-year period.
Utilizing the service of the Sanitation District's financial advisor, Public Resources
Advisory Group (PRAG), an eligible listing of bond counsel firms was developed from
the California Debt and Investment Advisory Commission database. Only those firms
who served as bond counsel for at least three debt issuances of$100 million or more
within the State of California during the last two full calendar years were included for
consideration. Following is the listing of those firms who were deemed eligible and
received a request for proposal (RFP):
• Fulbright & Jaworski
• Hawkins Delafield & Wood
• Jones Hall
• Nixon Peabody
• Orrick Herrington & Sutcliffe
• SidleyAustin
• Squire Sanders& Dempsey
• Stradling Yocca Carlson & Rauth
The following four firms submitted a proposal in response to the Sanitation District's
RFP:
• Fulbright & Jaworski
• Orrick Herrington & Sutcliffe
• Sidley Austin
• Squire Sanders & Dempsey
An evaluation team consisting of Lorenzo Tyner, Director of Finance and Administrative
Services; Mike White, Controller; Bob Geggie, Principal Accountant; and Ed Soong,
Executive Vice President with Public Resources Advisory Group, evaluated these four
proposals based on the pre-determined criteria of qualifications, proposed staffing, work
plan, and pricing. Fulbright & Jaworski and Orrick Herrington & Sutcliffe were the two
highest scoring firms and were scheduled for interviews.
Folm No.DW-1013 ReWM:WNtro]
Page 2
Book Page 24
Following the interviews by the evaluation team, Fulbright & Jaworski was unanimously
selected as the most responsible bidder based on the proposed legal team's
experience, the partners' willingness to spend fifty percent of the total bond counsel's
time on each transaction, and their ability to convince the evaluation team that the
Sanitation District would be a top priority account and that they would meet or beat
every required deadline within any future debt financing timeline schedule. Over the
past three and one-half years, the proposed legal team completed nine fixed rate
transactions, two variable rate transactions, and four swap transactions.
In addition, Fulbright &Jaworski was also the lowest bidder for each category within the
following fixed pricing schedule that is to remain in effect over the next five-years:
• New money fixed rate debt issue - $100,000
• Refunding fixed rate debt issue - $115,000
• New money variable rate debt issue - $125,000
• Refunding variable rate debt issue - $140,000
• Swap ($495 per hour) - $15,000 cap
JDR:LT:MDW
Forth No.D 102] RwinO oYn1101
Page 3
Book Page 25
ADMINISTRATION COMMITTEE mmiin9 Date TOBd.orM
0911ZM o9/zs/o7
AGENDA REPORT Item Number Them Number
ADKD7-47
Orange County Sanitation District
FROM: James D. Ruth, General Manager
Originator: Lorenzo Tyner, Director of Finance and Administrative Services
SUBJECT: REPLACEMENT OF CERTIFICATES OF PARTICIPATION SERIES 2006
STANDBY PURCHASE AGREEMENT
GENERAL MANAGER'S RECOMMENDATION
Authorize the General Manager to procure bids for the replacement of the Certificates of
Participation Series 2006 Standby Purchase Agreement.
SUMMARY
In March 2006, the Sanitation District issued COP Series 2006 in the amount of
$200 million. At that time, a seven-year standby purchase agreement was entered into
with DEPFA BANK, plc (DEPFA) that provides liquidity to variable rate investors in case
certain unexpected events occur and lowers the borrowing cost on the COP Series
2006. DEPFA was selected through a competitive bid process at a cost of 11.0 basis
points, or approximately $220,000 per year. This agreement now has approximately
five and one-half years remaining.
In July 2007, DEPFA was downgraded by Standard & Poors from an AA-to A+ long-
term rating and from an A-1+to A-1 short-term rating. The Sanitation District's
remarketing agent, Bear Stearns, estimates that the Sanitation District's remarketing
fees are currently approximately 2.0 basis points more costly than a variable rate
program supported by other higher-rated banks. In addition, the fees charged in the
liquidity market have declined. Recent five-year liquidity facility agreement bids for
highly-rated credits, such as the Sanitation District, have been in the neighborhood of
8.0 basis points. Each basis point costs the Sanitation District approximately $20,000
per year. The 3.0 basis spread between the existing standby purchase agreement of
11.0 basis points and current market indications of 8.0 basis points plus the increase of
2.0 basis points resulting from higher yields associated with the DEPFA standby
purchase agreement would generate savings of approximately 5.0 basis points, or
about $100,000 per year, or up to $550,000 over the remaining contract period with
DEPFA.
The out-of-pocket costs to liquidate and replace the existing standby purchase
agreement are estimated as follows:
Form No.DMOZ3 a 1.MIM7
Page 1
Book Page 26
• Bond counsel $10,000 - $15,000
• Financial Advisor $5,000- $10,000
• Replacement Liquidity Provider Attorney Fees $25,000- $40,000
• Rating agency fees (3) $15,000
The replacement of this standby purchase agreement would result in no termination
fees to DEFPA Bank, plc.
After deducting estimated costs, staff believes that approximately$470,000 in debt
financing savings could be obtained through the replacement of the existing standby
purchase agreement.
PRIOR COMMITTEE/BOARD ACTIONS
In February 2006, the Board approved the Execution and Delivery of an Installment
Purchase Agreement, a Trust Agreement, a Standby Certificate Purchase Agreement, a
Purchase Contract and a Remarketing Agreement in connection with the execution and
delivery of Orange County Sanitation District Certificates of Participation, Series 2006,
Authorizing the Execution and Delivery of such Certificates Evidencing Principal in an
Aggregate Amount of Not to Exceed $200,000,000.
ADDITIONAL INFORMATION
None.
JDR:LT:MDW
F..No..1..a PevixE:IXY01N�
Page 2
Book Page 27
ADMINISTRATION COMMITTEE fneedea13aa To Bd.of Dir.
09/17J07
AGENDA REPORT AD m Num
ber an IDNumbe
Nmb
-411
Orange County Sanitation District
FROM: James D. Ruth, General Manager
Originator: Lorenzo Tyner, Director of Finance and Administrative Services
SUBJECT: SUCCESSION MANAGEMENT PROGRAM UPDATE
GENERAL MANAGER'S RECOMMENDATION
Information only.
SUMMARY
The purpose behind succession management is to provide employees an opportunity to
prepare for OCSD's future staffing needs and for OCSD to build a leadership pipeline.
The public sector is expecting significant employee attrition in the next few years, so it's
imperative for OCSD as an agency to be prepared and for employees to be equipped
with the skills to compete for positions of interest. It's designed to be an integrative
approach to developing an OCSD leadership pipeline. The basic idea is to assist the
organization in identifying the right people with the right skills for the right job at the right
time; ensuring that well trained employees are progressing in their personal career
paths in preparation for future leadership opportunities.
Management has identified and defined 12 core leadership competencies deemed
important to the success of this organization. This effort is intended to address the long-
term developmental needs of its employees at many levels and across the span of their
service to OCSD. Mastery of these competencies will keep employees careers in line
with management's vision of the organization, its overall strategy, and its short-term and
long-term planning. OCSD has developed a system that includes workforce planning,
talent assessment, and development tools to ensure that its employees have the ability
and the opportunity to reach their full potential.
The first aspect of the program encompasses workforce planning information.
Workforce planning information contains a series of tools that can be used to identify
the agency's future staffing needs. With access to retirement probability reports,
leadership profiles, competency requirements, and job descriptions for positions
throughout the agency, management can identify and plan for anticipated vacancies. In
addition, it gives staff the opportunity to better prepare themselves for progression to a
higher-level position when future leadership opportunities occur.
FomI No.o 1 3 Nevijgo pyp,q)
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Book Page 28
After identifying a position of interest, staff speaks with management about career goals
and objectives and a talent assessment is initiated. The talent assessment is conducted
through on-line software that identifies leadership potential for future higher-level
vacancies. Colleagues will then assist in the assessment by answering a series of
questions. Co-workers can assess a boss, a colleague, or a staff member. The results
of the assessment will identify potential in a leadership role and any developmental
needs that should be explored.
The Succession Management Program also contains a development aspect which
includes coaching and mentoring. Participants may be paired with a coach or a mentor
to assist with professional growth. Participants will engage in a variety of
developmental activities including job stretch assignments, special projects, and key
assignments. In addition to these developmental opportunities, OCSD will offer
program participants speck training in 12 of the organization's core leadership
competencies beginning January 2008. Excess seats in the competency training
sessions will be made available to all OCSD staff to help them prepare for future
leadership opportunities.
Effective August 8, 2007, OCSD implemented a pilot Succession Management Program
for all Department Heads and Managers. In addition, the Human Resources Division
sent letters to each of the represented bargaining units to inform them of progress and
future intent to make the program available District-wide.
PRIOR COMMITTEE/BOARD ACTIONS
None.
ADDITIONAL INFORMATION
The Human Resources Division will closely monitor the Succession Management
Program over the course of the remainder of the Fiscal Year. Modifications,
adjustments, and improvements will be made to the program as the Human Resources
Division collects data and feedback.
These "lessons learned"will provide for continuous improvement and help refine the
program to ensure that it is functioning at peak performance for subsequent groups of
employees.
OCSD plans to make the Succession Management Program available to Supervisors on
July 1, 2008 and Professionals on July 1, 2009.
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Fo m NO.DMO2.3 PeNwdo3Io1W1
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ORANGE COUNTY SANITATION DISTRICT
(714) 962-2411
www.ocsd.com
Mailing Address:
P.O. Box 8127
Fountain Valley, California
92728-8127
Street Address:
10844 Ellis Avenue
Fountain Valley, California
92708-7018