HomeMy WebLinkAbout2008-05 Ops ow
MINUTES OF THE
OPERATIONS COMMITTEE
Engineering, Operations R Maintenance, and Technical Services
Orange County Sanitation District
May 7, 2008—5:00 p.m.
A meeting of the Operations Committee of the Orange County Sanitation District was held on
May 7, 2008, at 5:00 p.m. in the Sanitation District's Administrative Office.
(2) ROLL CALL
Following the Pledge of Allegiance, a quorum was declared present, as follows:
Operations Directors Present: Staff Present:
Larry Crandall, Chair Jim Ruth, General Manager
Ken Parker, Vice Chair Bob Ghirelli, Assistant General Manager
Charles Antos Nick Arhontes, Dir. of Operations & Maintenance
Don Bankhead Jim Herberg, Director of Engineering
Leslie Daigle Ed Torres, Director of Technical Services
Rose Espinoza Lorenzo Tyner, Director of Finance and
Patsy Marshall Administrative Services
Roy Moore Lilia Kovac, Committee Secretary
David Shawver Tod Haynes, Engineering Manager
Harry Sidhu John Linder, Engineering Manager
Constance Underhill Matt Smith, Engineering Manager
James M. Ferryman, Board Chair Layne Baroldi
Doug Davert, Board Vice Chair Carla Dillon
Dave Heinz
Operations Directors Absent: Vlad Kogan
Simon Watson
Chuck Winsor
Others:
FILED IN THE OFFICE OF
THE CLERK OF THE BQARD
ORANGE COUNTYSANRATION uI CT
(3) APPOINTMENT OF CHAIR PRO TEM MAY 28 2008
No appointment was necessary. 7 'h
BY:
(4) PUBLIC COMMENTS
There were no public comments.
Minutes of the Operations Committee
May 7, 2008
Page 2
(5) REPORT OF THE COMMITTEE CHAIR
Chair Crandall reported that General Manager, Jim Ruth, had been awarded the Greater Los
Angeles Federal Executive Board Leadership Award at the annual Public Service Recognition
Week ceremony held May 7, 2008 in Long Beach
(6) REPORT OF THE GENERAL MANAGER
Jim Ruth, General Manager, did not give a report.
(7) CONSENT CALENDAR ITEMS
a. MOVED, SECONDED, AND DULY CARRIED: Approve minutes of the April 2, 2008
Operations Committee meeting.
b. Item pulled for discussion.
C. OP08-18 MOVED, SECONDED, AND DULY CARRIED: Recommend to the Board
of Directors to: 1)Approve Change order No. 5 to the contract issued to
Hill Brothers Chemical Company for the Purchase of Magnesium
Hydroxide, Specification No. C-2005-244, authorizing a unit rate increase
of$0.20 per gallon,for a total unit price of$1.84 per gallon, plus
applicable sales tax for a one-year period effective July 1, 2008 through
June 30, 2009, and all other terms of the contract shall remain in effect
(P.O. 102362 OB).
2)Authorize a 10% unit cost escalation contingency.
d. Item pulled for discussion
e. OP08-20 MOVED, SECONDED,AND DULY CARRIED: Recommend to the Board
of Directors to: 1)Award a contract to Olin Chlor Alkali Products,for the
Purchase of Sodium Hydroxide (Caustic Soda) 25%solution,
Specification No. C-2008-371 BD, for delivery to the plants for the period
July 1, 2008 through June 30, 2009,for a unit price of$459.90 per dry ton
plus freight of$200.00 per dry ton, plus applicable sales tax for an
estimated annual amount of$431,235.00, with four one-year renewal
options; and,
2)Authorize a 10%annual cost escalation contingency.
3)Award a contract to Basic Chemical Solution, LLC, for the Purchase of
Sodium Hydroxide (Caustic Soda)50% solution, Specification No.
C-2008-371 BD, for delivery in the collection system,for the period July 1,
2008 through June 30, 2009,for a unit price of$539.00 per dry ton,
subject to the Harriman Chemsult Limited Index, plus freight of$39.48 per
dry ton, plus applicable sales tax for an estimated annual amount of
$235,075.00 with four one-year renewal; and,
' Minutes of the Operations Committee
May 7, 2008
Page 3
4)Authorize an 8%quarterly cost escalation contingency.
f. OP08-21 MOVED, SECONDED, AND DULY CARRIED: Approve Amendment No.
1 to Cooperative Projects Grants Program Contract No. 0604 with
Midway City Sanitary District, providing for an 11-month time extension.
g. OP08-22 MOVED, SECONDED,AND DULY CARRIED: Recommend to the Board
of Directors to: 1)Approve a budget Increase of$128,100 for
Rehabilitation of District Siphons, Contract No. 2-68,for a total budget of
$7,854,100; and,
2)Approve a contingency increase of$136.108 (3%)to the construction
contract with Ken Thompson, Inc.,for Rehabilitation of District Siphons,
Contract No. 2-68, for a total contingency of$363,008 (8%).
END OF CONSENT CALENDAR
b. OP08-17 Director of Technical Services, Ed Tortes, answered questions that arose
from the report, and will be clarifying prior to sending to the Board of
Directors for approval.
MOVED, SECONDED, AND DULY CARRIED: Recommend to the Board
of Directors to authorize the General Manager to sell surplus emission
reduction credits via negotiated contracts with ICAP United, Inc. and
Cantor CO2e, LP, in a form approved by General Counsel.
d. OP08-19 Director of Operations and Maintenance, Nick Arhontes, announced
clerical corrections to the report,which will reflect in the report going to
the Board of Directors for approval.
MOVED, SECONDED, AND DULY CARRIED: Recommend to the Board
of Directors to: 1)Authorize the General Manager to approve renewal of a
contract with Neutron Products, Inc., for Purchase of Anionic Polymer,
Specification No. C-2006-273, authorizing a price increase of$.15Ab, for
a total price of$3.0011b, for a one-year period effective September 1,
2008 through August 31, 2009(P.O. 102634-OB).
2)Authorize a 10%cost escalation contingency.
(8) ACTION ITEMS
a. OP08-23 MOVED, SECONDED, AND DULY CARRIED: Recommend to the Board
of Directors to approve a contingency increase of$623,114(17%)to the
Professional Design Services Agreement with Earth Tech, Inc.,for Sludge
Digester Rehabilitation at Plant No. 1, Job No. 131-100,for a total
contingency of$989,652 (27%).
Minutes of the Operations Committee
May 7, 2008
Page 4
b. OP08-24 MOVED, SECONDED, AND DULY CARRIED: Recommend to the Board
of Directors to approve a contingency increase of$2,003,323 (18%) to
the Professional Design Services Agreement with HDR, Inc. for Sludge
Dewatering and Odor Control at Plant No. 1, Job No. P1-101, for a total
contingency of$3,116,281 (28%).
C. OP08-25 MOVED, SECONDED, AND DULY CARRIED: Recommend to the Board
of Directors to Approve Amendment No. 8 to the Professional Services
Agreement with Integrated Program Management Consultants, a joint
venture of Parsons Water and Infrastructure, Inc., and CH2M Hill, Inc., for
Program Management Services for the Capital Improvement Program
authorizing:
1) Establish an amount not to exceed $16,987,271 for year seven (Fiscal
Year 2008/09)of the ten-year contract; and,
2) Increase the total amount of the ten-year contract to an amount not to
exceed $93,077,246.
(9) INFORMATIONAL ITEMS
a. OP08-26 FY07/08 Budget Update
Director of Finance and Administrative Services, Lorenzo Tyner,
presented a brief overview of the two-year budget, highlighting the
revised Capital Improvement Program, the planned staffing levels, and
the Sanitation District's financial position. It was also noted that State
budget proposals may include a loss of state funding to special districts.
(10) DEPARTMENT HEAD REPORTS
Assistant General Manager, Bob Ghirelli, reported that staff would be hosting Director Marshall,
Buena Park city council members and city staff to a plant tour of the OCSD facilities, the
Groundwater Replenishment System, and CIP projects in progress. Staff extended an invitation
to all cities to join the tour.
Director of Operations and Maintenance, Nick Arhonles, introduced Dave Heinz, Treatment
Plant Operations Manager, who briefly presented an overview of two recent emergency repairs
on pipeline issues and its complexities.
(11) OTHER BUSINESS, COMMUNICATIONS OR SUPPLEMENTAL AGENDA ITEMS, IF ANY
Committee Chair Larry Crandall, announced there would be a construction progress tour of the
Ellis Pump Station at 4:30 p.m. on Thursday, June IVh.
Miribtes of the Operations Committee
May 7, 2008
Page 5
(12) CLOSED SESSION
There was no closed session.
(13) ADJOURNMENT AND FUTURE MEETING DATES
The Chair declared the meeting adjourned at 6:08 p.m. The next Operations Committee
meeting is scheduled for Thursday, June 12, 2008, at 5:00 p.m.
Submitted by:
Ulld Kovac
Committee Seaetary
H:Wepl gendMOpemficns Committee\0pembons 2008t0508W50708 Oper MinWw.d=
Distributed at th O era ions
Committee r Proposed Budget FY 08-09 and FY 09-10
Meeting Operations Committee
May 7, 2008
Proposed Budget for
FY 08-09 and FY 09-10
6
May 7.2008
Highlights of the proposed budget:
♦ Budget Oullays
• FYPPOe Bu$p•1=5513mills-
• FYOB WBurd, ::$5e9 mlllgn
• FY09loeul9e1.1,1=1lbn
• Revised Capital Improvement Program(CIP)
• to%livarasem FY05-09
• 32%Manese In FY 09-10
♦ increased Stalling Levels—1%per year,001 and Bag FTEs
• Strong Financial Positioning—maintains AA bond rating
• TM-year Budget—annual updates
Additional revenue and debt financing are
required to support needed capital
improvements .
R•MnWi _____ _FY 060E
eos verges $219M PI) $242M(46%)
Genee lnwme $19M 1s01) $110M(2YF)
OeYl Prpcw05 $25aM(62%) $,..0m)
Tonsil— p93N San M
oulla c FY" P`01,10
on'I—.r,.1.-1 U41 M(75%) $]35 M(69%)
T1ae1man1 a 0epaN $146M(PS%) $ea.02,)
TelKpuarye Was 11,110Is
Proposed Budget FY 08.09 and FY 09-10
Operations Committee
May 7.2008
Sources of Funds
Oenenl
5117 M
$Il]%M FNF6CIugt
S46% Iname
Feeaa tMrpn �% St18M
54�96M OMI PmwaCe
RYM
a]% MMPoaeOv
FIYfM
9t96
FY 06UB FT M10
Tele1:450 N l llbn Teal:SJ] lr_
Most OCSD revenue Is related to User Fees.
FY 08.09 FY 09-10
General User Fees $183 M $203 M
Permit User Fees $ 16 M $ 18 M
Capital Facilities Capacity $ 20 M $ 21 M
Charges
Total Fees&Charges $219 M $242 M
Most of our non-fee related revenues come
from property taxes.
"am FY 09.10
Property Tex $as M $fib M
Interest $1 s M $19 M
Interagency Sewer Charges $29 M $24 M
Other $ am $ am
Total Norr•Fee
Belated Revenue $117 M $116 M
2
Proposed Budget FY 09-09 and FY 09-10
Operations Committee
May 7, 2008
Outlays
Outlays will decrease almost$100 million
in FY 09-10, primarily due to the CIP.
FY OB-09 IY 09.10
clpp.W a ..) $441 M� $335 Myew
Treatment taxi Disposal $148 M oz $155 M lawl
Total Outlays $588 M $490 M
The Capital Improvement Program
can be divided Into five distinct areas.
Facets f 0s10
1.$ecwMary Treatment Fscilwas $1 so M $ 99 M
2.Gmun ter Replenistanent System $ 3 M $ OM
3.Treatment Plant Reheh I UpgraEea $102 M $ 76 M
4,collections $ 91 M $ fie M
5.Debt Seale $ 77M c 91M
TOW $441 M $335 M
3
Proposed Budget FY 08-09 and FY 09-10
Operations Committee
May 7, 2008
More than 5145 million is allocated to
Treatment and Disposal Expenses.
CIF(izWding Doti Service) $441 M m%i 5 MIS M mmv
Trastmant and Disposal S iM M in,e S 155 M tav
Tote)Expenditures $589 M $490 M
Total Treatment and Disposal Expenses increase
$21 million from FY 07-06 to FY D9-10.
11% 5fi
5149 M
4134 M
FY 07-06 FY 08-09 FY 09-10
P,ge.W Pm Prcpwed
Total operating costs will increase an average of
7.6%from S134 to S155 over 2 years.
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Proposed Budget FY 08-09 and FY 09-10
Operations Committee
May 7, 2008
The majority of the expenditure increase
will occur in three categories:
FY08-W FY09-10
Category Millions MUM
1. Salaries and Benefits $4.4 $6.0
2. Contractual Services $8.6 $0.4
3. Operating Expenses $3.9 $1.3
Existing collective bargaining agreements and
a t %increase in staffing will increase Salaries
and Benefit costs.
Proposed Propond
FY 08-08 FY 09.10
Wages + 2.5M + 4.7M
Benefits + 1.9 M + 1.3 M
Total Salaries + 4.4 M + 6.0 M
&Benefits
Biosolids hauling costs continue to rise
increasing contractual services budget.
FY WN FY W10
P.Po Pro W
Solids Removal + 5.6 M +1.9 M
Other Waste Dlspmal + 2.7 M <1.5 M>
Ogler + 0.3 M
Total Conuactua Services + 8.6 M +0.4 M
5
Proposed Budget FY 08-09 and FY 09-10
Operations Committee
May 7, 2008
The costs of chemicals required to treat
effluent to current levels continue to
Increase.
Propowd Propowd
Ev Mas "0s10
Chemicals .23 M +OA M
Irauerp dwawwn 6 ader wpual
Chemiml Coagulame +12 M +0.9 M
Other +02M —
Total Operating +3sM +1.3M
Ezpemes
Next Steps
♦ Additional Administrative Committee
meetings
♦ Budget presentations for each Committee
♦ Presentation and adoption at the
June Board meeting
Distributed at th O rations
Committee 0 IPMC Contract
Meeting Perations Committee
May 7, 2008
Capital Improvement Program
Management Using IPMC
a •
May 2008
Why Use Management
Consultant?
♦ Limited in-house resources
♦ Provides flexible staffing ability
♦ Quick response to needs
♦ Single point of responsibility
♦ Uniform approach on multiple projects
♦ Provide skills transfer
♦ Access to technical experts
♦ Desire to become more business-like
Cash Flow Performance
ONM 101%
•ay(�t 109% 109%
SxsaM •Muelel Ferw••1
erx
53W M
St50M
90T.
014
S1WM
B%
SEOM-
MM
01-02 02-03 03-04 N-05 OS-05 E 7 07-00'
Egewuwa iw Ev me•w e�w m a rowv wow vuro Ab.
IPMC Contract
Operations Committee
May 7, 2008
Staffing Budget Compared
to Overall CIP
$400 M - -
m.M •IPMc
•CCSp
S]00 M •COnilnpem/
$t50 M
s ' •Conavllnnl•
S]00M ' •Conslmdlon
5150M
SIoM ■ ■ ■.■.■ ■
$50M
OM
OB 09 0510 10.11 11-00 1b1] 1}ti Ii15
Fiscal Year
Staffing Budget Compared
to FY 08-09 CIP
ocao
iYrAM
IPMC
f1iAY 0%
5'.
CPMI„p•ncy�
SHAM
Con 5'=
51]9 1.11•
COn51rudwt
S285 0 M
78'.
Total FY 08-09 CIP
= S363.200.000
Projected CIP Staffing Needs
165 169 • IPMC
162 149 ocso
■ ■ ■ ■ i
89 99 99 99 69
c u,rcmYez, 0"9 0S10 10'11 1191
AGu•1
L
IPMC Contract
Operations Committee
May 7,2008
Example of Varying
IPMC Staffing Needs
FY 01-0! 0 9 M10 I 1D11 11.12
Profap tMnagora 6 6 5 2 3
Prgem Englnwre 12 11 10 0 6
R0ai2en1 En91wen 9 11 10 7 2
Inspectors 13 15 16 11 6
ProjectC nude 14 16 13 11 9
Prolw 1 11 13 11 9 6
COneUudim Supp0rl
Total 66 70 63 50 33
IPMC Staff Costs
Compared to OCSD Staff
ocso
IPMC-$127 M
02-03 05 06 ...9 11-12
IPMC Assists in Many Areas
of CIP Planning and Execution
♦ Planning-CIP validation,special studies
♦ Protect/program management
♦ Design management-special reviews
• Construction management-inspection,
engineering
♦ Project commissioning and start-up
3
IPMC Contract
Operations Committee
May 7, 2008
IPMC Budget Performance
.. YY YW YY
BW,1 i.YSZ/! 41.W.1W WS110L� NldNd9 e}AYW P0.MIli
BMM}t,,Y.M I,y1W 11,Ii1Y Rp,1i iYtl,.tlt �tlCl0
M�WLp tY1N it,MdM PfaAN 4HI]t) PTSP} iYIAY
'6SNb�bM1 WOwYSS W�be�ppp Awele
Staff Recommendation
Authorize an amount not to exceed
$16,987,271 for year seven (PY 08-09).
Questions?
vise Our weEcne: Www.00SD.com
STATE OF CALIFORNIA)
) SS.
COUNTY OF ORANGE )
Pursuant to California Government Code Section 54954.2, 1 hereby certify that
the Notice and Agenda for the Operations Committee Meeting of Orange County
Sanitation District to be held on May 7, 2008, was duly posted for public inspection in
the main lobby of the Districts'offices on April 30, 2008.
IN WITNESS WHEREOF, 1 have hereunto set my hand this 30th day of April
2008.
Lilia Kovac, co mitte Secretary
Orange County Sanitation District
HADEPTIAGENDAMPERATIONS COMMITTEEWGENDA CERTIFICATION.DOC
Distributed at the O erations
Committee S 0 Emergency Repairs
Meeti g Operations Committee
May 7, 2008
Emergency Repairs
at Plant No. 1 and 2
6
May 7,2008
TmMml1.nI Ho.3ln Hu.1,1—Beoc
120-inch Discharge Line Repair
v�mpsi on y� � � 1
LI*
* t
January 18, 2008
emergency repairs initiated
Emergency Repairs
Operations Committee
May 7, 2008
*D,,,,,,r,dPatch over hole
hole in pipe
due to corrosion
Other corrosion oinjected
points found and into voids in soil
repaired
.-1..Olnl Xo.1 In F W nMln O1hy
90-Inch Primary Influent Lines Repair
i
aa:
�pCy1•
I L
L
Emergency Repairs
Operations Committee
May 7, 2008
Seepage discovered March 9, 2008,
Initiated investigation
N W
A challenge to stop the flow
&I
P r_. -•
"tester Leak identified
West 90-inch Pipe
Emergency Repairs
Operations Committee
May 7, 2008
i
"joint Final repair
with new seal
West 90-Inch Pipe
oIM
LargecrackRepair options
discovered to be determined
East 90-Inch Pipe
iuWmenl PWm W.2 In nunnnamn Bunn
Groundwater Seepage in an
Abandoned Meter Pit
aw��N
Permanent fix yet to be determined
Emergency Repairs
Operations Committee
May 7, 2008
Emergency Repairs
at Plant No. 1 and 2
it
May 7.2008
ina,mmn,Plant No,2In aunangten french
120-inch Discharge Line Repair
ocean owmll
Booster station
Effluent
Hume a'.
O
sa� ti
o era
son..ne a.,
Is
OJanu,ry' 18, 2008
emergency repairs initiated
J
Distributed at th Operations IPMC Contract
Committee O v Operations Committee
Meeting May 7, 2008
Capital Improvement Program
Management Using IPMC
a •
May 2008
Why Use Management
Consultant?
♦ Limited in-house resources
♦ Provides flexible staffing ability
♦ Quick response to needs
♦ Single point of responsibility
♦ Uniform approach on multiple projects
♦ Provide skills transfer
♦ Access to technical experts
♦ Desire to become more business-like
Cash Flow Performance
.M
B.dgN IOaA tOB%
moM ••,leW lel FereuM
B%
EW N
$1NIM
fTi
t
qf4 N
M14
XOM
bM
O1-03 0?03 00-01 0145 OS-06 O6-07 07-00'
'[wm,un�o-rr mte me uwy m e io-«aa mwy..iune aw.
IPMC Contract
Operations Committee
May 7, 2008
Staffing Budget Compared
to Overall CIP
"OO M
M.M {� e
DOOM 1+II .COnllryexry
$210M •COnfulUMa
5200M •Conslru[Ibn
$ISOM �
$I OOM ■ ■ ■ ■ ■ ■
550M
0M
0849 Of10 10-11 11-12 13-13 1314 1415
Fscal Year
Staffing Budget Compared
to FY 08-09 CIP
1 ocso
PMc
530M
52b 17M gya
5%
CO �9%
$14.8 [y
e.G M
COna.M1anb— 5%
$R9M
Construction
K85.8 M
78%
Total FY 08-09 CIP
6363,200,000
Projected CIP Staffing Needs
165 169 • IPMD
6249 OCSD
■ ■ ■ ■ M
99 99 tma
9 99 99
C—Mrear, 01-09 0990 10-11 11-12
Atlml
L
IPMC Contract
Operations Committee
May 7,2008
Example of Varying
IPMC Staffing Needs
Pv mUe OB OPto It, 11-12
Project Manage. 6 6 5 4 3
Project Engineers 12 1 11 10 a 5
%Sident Engineer, 9 11 111
Inspanor, 14 15 Project Cwn 14 14ftJ.I/ 11 /3 Corslr w,sgVWTwo] 66 TO
IPMC Staff Costs
Compared to OCSD Staff
PMc
ocso
I PM
� .1
C-5127 M
dz-03 — 0S06 oe-os 11-12
IPMC Assists in Many Areas
of CIP Planning and Execution
♦ Planning-CIP validation,special studies
♦ Project/program management
♦ Design management-special reviews
♦ Construction management-inspection,
engineering
♦ Project commissioning and start-up
3
IPMC Contract
Operations Committee
May 7,2008
IPMC Budget Performance
R OlM WM
9� M.�6Pl Nt!N.11O 3�t1MM� S�lMtXi INAN.W i,6.tir.YY
FAVCbw,.1X]]t 11-M)@ �ttl6�tl �itlI3A A]Q11
Rnuliq pl1N i,.lmy, 'i1lDYtl t].WdO 4DttM t�N.W
'E4eYn,brvmuwuNJu�bs NNPMms.
Staff Recommendation
Authorize an amount not to exceed
$16,987,271 for year seven (FY 08-09).
Questions?
Visit Our Website: WWW.00SD.COm
T
Distributed at the Operations
Committee -7 U q Proposed Budget FY 08-09 and FY 09-10
Meeting Operations Committee
May 7, 2008
Proposed Budget for
FY 08-09 and FY 09-10
e
May 7.200B
Highlights of the proposed budget:
• Budget Outlays
• FY07-0a Buren=551]mllan
♦ FY[e-09 Bud".5589 mu..
• FY p)IO Budge=Slap lNbn
• Revusd Caput Impron enem Program(CIP)
le^„....eua n n Dees
• ]xY deauwnFY o9.l0
♦ Increased staffing Levels—1°b Mr year,Bat and Bab"Es
• slmng Financial Positioning—maintains M wnd rating
• Tm-Year Budget—annual updates
Additional revenue and debt financing are
required to support needed capital
improvements .
B.r..� ease np•lr
axd large 5219M pA.1 SNRM(d6'.1
—11.in.uma 511]M Qyel SI 16 M(W.1
pcelRrcee6t 5256M 513M 01.1
Tort Mwnlw PRY WIY
QW/s rYPp Insists
CIP 1rtag0.o15.rrta SHIM 13Y1 STJSM ISA)
1aePwYa0.pxY SIMM IaS\I SISSM I.,
Ties assets PPP PRP
Proposed Budget FY 08-09 and FY 09-10
Operations Committee
May 7, 2008
Sources of Funds
Y1PM
Emtanl
Ircane
RpA Wegm iflb S11fiM
WtaM � my
�' GSBY
yx 0.slnmN
$IYIM
3]%
FY WAS FYY 10
Talt$Si M01b1 Telel:boll Mullen
Most OCSD revenue is related to User Fees.
FY 0e Fy09.10
General User Fees $183 M $203 M
Permit User Fees $ 16 M $ ism
Capital Facilities Capacity $ 20 M $ 21 M
Charges
Total Fees&Charges $219 M $242 M
Most of our non-fee related revenues come
from property taxes.
FY 0e-0e "09,10
Property Tax $65M $68M
Interest $ 18 M $19 M
Interagency Sewer Charges $29 M $24 M
Other $ 510 $ 5 M
Total Non-Fee
Related Revenue $117 M $116 M
2
Proposed Budget FY 08-09 and FY 09-10
Operations Committee
May 7, 2008
Outlays
Outlays will decrease almost$100 million
In FY W10,primarily due to the CIP.
FY 0l nOF70
optmewaa,str,es $M1111ime $336111l Ores
Traasnenl and gappal $1MMpaq $1$$$101+1
TOW OWaya $$wm 11,10011111
The Capital Improvement Program
can be divided into five distinct areas.
F 0509 FY 79-10
1.Secondary Treatment Facilte6 $16611 $ al
2.Groundwater Replenishment System $ 3M S OM
3.Treatment Plant Reha,/Upgrades $102 M $ 76 M
d.Collections $ 91 M $ 68 M
5.Dett Semi $ n M $ 91 M
Toted $"IM $335M
3
Proposed Budget FY 08-09 and FY 09-10
Operations Committee
May 7, 2008
More than $145 million is allocated to
Treatment and Disposal Expenses.
FY WN FY 0$-10
CIP(Including Debt Service) $441 M the%t $335 M tmri
Treatment antl Disposal $14a M my $155 M Pml
Total Expenditures $509 M $490 M
Total Treatment and Disposal Expenses Increase
$21 million from FY 07-09 to FY 09-10.
% 5x
-it 48 M
FY 07-08 FY 08-09 FY 09-10
Project. P.,.ea Pr.,r.d
Total operating costs will Increase an average of
7.6%from$134 to$155 over 2 years.
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w
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mi izooi
t.YlgvWipapA. inw.
Proposed Budget FY 08-09 and FY 09.10
Operations Committee
May 7,2008
The majority of the expenditure increase
will occur in three categories:
F 0 F o910
Category Millions Minors
I. Salaries and Benefits $4.4 $6.0
z. Contractual Services $6.6 $0.4
3. Operating Expenses $3.9 $1.3
Existing collective bargaining agreements and
a 1 %Increase in staffing will Increase Salaries
and Benefit costs.
PropoW prepo
FY OB-0e "wio
Wages a 25 M ♦ 47001
Senellts ♦ 1.9 M ♦ 1.3 M
Total Salaries ♦ 4.4 M ♦ SA M
a Benefits
Biosolids hauling costs continue to rise
increasing contractual services budget.
FY o609 "Wit)
prppoW nrwo
Solias Removal s5.6M v1.911A
o0,er waste Disposal a 2.1111 <1.sm>
olner ♦ 031101
Total Contractual Services ♦ 6.6M ♦0.4M
5
Proposed Budget FY 08-09 and FY 09-10
Operations Committee
May 7,200B
The costs of chemicals required to treat
effluent to current levels continue to
increase.
Y F Rraro p l
FY 0&W F 0310
Chemicals +25M +a<M
nrowm eu�ni.mmaaevuraaq
Chemical Coagulants +1.2M +0.9M
Omer ♦02M —
Tow Operafing ♦3.9M +12M
Expanses
Next Steps
♦ Additional Administrative Committee
meetings
♦ Budget presentations for each Committee
♦ Presentation and adoption at the
June Board meeting
ORANGE COUNTY SANITATION DISTRICT
7141U�P411 NOTICE OF MEETING
i/14!'ifi21Si5[i
uanv.C4Cd.Cmm OPERATIONS COMMITTEE
Engineering, Operations 8: Maintenance, and Technical Services
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ORANGE COUNTY SANITATION DISTRICT
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DISTRICT'S ADMINISTRATIVE OFFICES
cltletl 10844 ELLIS AVENUE
Anaheim FOUNTAIN VALLEY, CALIFORNIA 92708
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'W7 The regular meeting of the Operations Committee of the Orange County
Sanitation District will be held at the above location, date and time.
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To maintain world-c/ass leadership in wes[ewater 8ntl water resource management
OPERATIONS COMMITTEE MEETING DATES
OPERATIONS COMMITTEE BOARD
MEETING DATE MEETING DATE
05/07/08 05/28/08
06/12/08** 06/25/08
07/02/08 07/23/08
AUGUST DARK 08/27/08
09/03/08 09/17/08*
10/01/08 10/22/08
11/05/08 11/19/08*
12/03/08 12/17/08*
JANUARY DARK 01/28/09
02/04/09 02/25/09
03/04/09 03/25/09
04/01/09 04/22/09
05/06/09 03/27/09
O6/03/09 04/24/09
*Meetings are being held on the third Wednesday of the month.
**Meeting scheduled to the second Thursday of the month due to conflict with
League of Cities.
ROLL CALL
OPERATIONS COMMITTEE
Engineering, Operations & Maintenance, and Technical Services
Meeting Date: May 7, 2008 Time: 5:00 p.m.
Adjourn:
COMMITTEE MEMBERS (13)
Larry Crandall Chair
Ken Parker Ice Chair)
Charles Antos
Don Bankhead
Rose Espinoza
Patsy Marshall
Roy Moore
David Shawver
Harry Sidhu
Constance Underhill
Don Webb
James M. Ferryman Board Chair
Doug Davert Board Mice Chair
OTHERS
Brad H in, General Counsel
STAFF
Jim Ruth, General Manager
Bob Ghirelli, Assistant General Manager
Nick Arhontes, Dir. of Operations & Maintenance
Jim Herber , Direct of Engineering
Ed Torres, Director of Technical Services
Lorenzo Tyner, Director of Finance and
Administrative Services
Lilia Kovac, Committee Secretary
Tod Ha es
John Linder
Matt Smith
H Wepaagenda\Opembons Committee\Opemtions 2008\0508\02Roll Call.d=
AGENDA
REGULAR MEETING OF THE
OPERATIONS COMMITTEE
Engineering, Operations & Maintenance, and Technical Services
ORANGE COUNTY SANITATION DISTRICT
May 7, 2008 - 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) 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 April 2, 2008 Operations Committee meeting.
b. OP08-17 Recommend to the Board of Directors to authorize the General Manager to sell
surplus emission reduction credits via negotiated contracts with CAP United,
Inc. and Cantor CO2e, LP, in a form approved by General Counsel.
(Book Page 11)
Book Page I
Operations Committee
05/07/08
Page 2
C. OP08-18 Recommend to the Board of Directors to: 1)Approve Change order No. 5 to the
contract issued to Hill Brothers Chemical Company for the Purchase of
Magnesium Hydroxide, Specification No. C-2005-244, authorizing a unit rate
increase of$0.20 per gallon, for a total unit price of$1.84 per gallon, plus
applicable sales tax for a one-year period effective July 1, 2008 through June
30, 2009, and all other terms of the contract shall remain in effect(P.O. 102362
OB).
2)Authorize a 10% unit cost escalation contingency. (Book Page 13)
d. OP08-19 Recommend to the Board of Directors to: 1) Authorize the General Manager to
approve renewal of a contract with Neutron Chemicals, Inc., for Purchase of
Anionic Polymer, Specification No. C-2006-273, authorizing a price increase of
$.015ft for a total price of$3.00/lb, for a one-year period effective September
1, 2008 through August 31, 2009 (P.O. 102810-OB).
2)Authorize a 10%cost escalation contingency. (Book Page 15)
e. OP08-20 Recommend to the Board of Directors to: 1)Award a contract to Olin Chlor
Alkali Products,for the Purchase of Sodium Hydroxide (Caustic Soda) 25%
solution, Specification No. C-2008-371 BD, for delivery to the plants for the
period July 1, 2008 through June 30, 2009, for a unit price of$459.90 per dry
ton plus freight of$200.00 per dry ton, plus applicable sales tax for an
estimated annual amount of$431,235.00, with four one-year renewal options;
and,
2)Authorize a 10% annual cost escalation contingency.
3)Award a contract to Basic Chemical Solution, LLC, for the Purchase of
Sodium Hydroxide (Caustic Soda) 50% solution, Specification No.
C-2008-371 BD, for delivery in the collection system, for the period July 1, 2008
through June 30, 2009, for a unit price of$539.00 per dry ton, subject to the
Harriman Chemsult Limited Index, plus freight of$39.48 per dry ton, plus
applicable sales tax for an estimated annual amount of$235,075.00 with four
one-year renewal; and,
4)Authorize an 8% quarterly cost escalation contingency. (Book Page 16)
f. OP08-21 Approve Amendment No. 1 to Cooperative Projects Grants Program Contract
No. 0604 with Midway City Sanitary District, providing for an 11-month time
extension. (Book Page 18)
g. OP08-22 Recommend to the Board of Directors to: 1)Approve a budget increase of
$128,100 for Rehabilitation of District Siphons, Contract No. 2-68,for a total
budget of$7,854,100; and,
2)Approve a contingency increase of$136,108 (3%)to the construction
contract with Ken Thompson, Inc., for Rehabilitation of District Siphons,
Contract No. 2-68,for a total contingency of$363,008 (8%). (Book Page 23)
Book Page 2
Operations Committee
05/07/08
Page 3
END OF CONSENT CALENDAR
h. Consideration of items deleted from Consent Calendar, if any.
(8) ACTION ITEMS
a. OP08-23 Recommend to the Board of Directors to approve a contingency increase of
$623,114 (17%)to the Professional Design Services Agreement with Earth
Tech, Inc., for Sludge Digester Rehabilitation at Plant No. 1, Job No. P1-100,
for a total contingency of$989,652 (27%). (Book Page 25)
b. OPO8-24 Recommend to the Board of Directors to approve a contingency increase of
$2,003,323(18%) to the Professional Design Services Agreement with HDR,
Inc. for Sludge Dewatering and Odor Control at Plant No. 1, Job No. P1-101, for
a total contingency of$3,116,281 (28%). (Book Page 27)
C. OPOS-25 Recommend to the Board of Directors to Approve Amendment No. 8 to the
Professional Services Agreement with Integrated Program Management
Consultants, a joint venture of Parsons Water and Infrastructure, Inc., and
CH2M Hill, Inc., for Program Management Services for the Capital
Improvement Program authorizing:
1) Establish an amount not to exceed $16,987,271 for year seven (Fiscal Year
2008/09) of the ten-year contract; and,
2) Increase the total amount of the ten-year contract to an amount not to
exceed $93,077,246. (Book Page 29)
(9) INFORMATIONAL ITEMS
a. OP08-26 FY07108 Budget Update— Lorenzo Tyner (Book Page 37)
(10) DEPARTMENT HEAD REPORTS
• Emergency Repairs
(11) OTHER BUSINESS, COMMUNICATIONS, SUPPLEMENTAL AGENDA ITEMS, OR ITEMS FOR
FUTURE AGENDAS, IF ANY
(12) CLOSED SESSION
Book Page 3
Operations Committee
05/07/08
Page 4
During the course of conducting the business set forth on this a9entla as a regular meeting of the Committee,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 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)
:employee actions or negotiations with employee representatives; or which are exempt from public disclosure
.under the California Public Records Act, may be reviewed by the Committee during a pennitled closed session
:antl are not available for pudic inspection. At such time as the Committee takes final actions on any of these
subjects,.the minutes will reflect all required.disclosures of information.
a. Convene in closed session.
b. Reconvene in regular session.
C. Consideration of action, if any, on matters considered in closed session.
(13) ADJOURNMENT-The next Operations Committee meeting is scheduled for Thursday,
June 12, 2008, at 5:00 p.m.
Book Page 4
Operations Committee
05/07/08
Page 5
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 date 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 Operations Committee on specific agenda items or
matters of general interest. As determined by the Chair, speakers may be deferred 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 Adjournment: 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 Secretary ten days in advance of the Committee meeting.
(Committee Chair Lary Crandall (714)593-4400 slcrandall(daol.com
Committee Secretary: Lille Kovac (714)593-7124 Ikovac(alocsd.com
(General Manager Jim Ruth (714)593-7110 imthralocstl.cem
iAssistent General Manager Bob Ghirelli (714)593-7400 rchirelliAmsd.com
(Director of Technical Services Ed Tones (714)593-7080 etorres(docsd.com
Director of Engineenng Jim Herberg (714)593-7300 iherbero0ocsd.com
Dir.of Operations and Maintenance Nick Amontes (714)593-7210 namontes(docsd.com
Book Page 5
Operations Committee
Rolling Agenda Report Calendar
Date Dept Action or
Description of Report Information
June TS EnerTech Biosolds Processing Facility Construction Information
Update
June O&M Purchase of Ferrous Chloride Action
June O&M Purchase of Bleach Action
June O&M Deep Well Injection Information Only
June O&M WERF Cost-Effective Rehab Methods for Private Information Only
Laterals Executive Summary
Approve Quitclaim Agreement with City of Newport Action
July Eng Beach re Bitter Point Pump Station Replacement, Job
No. Sdg
July Eng T�iunk m�men�t No.
ReachoBP�rNNo.77 37 edhill Action
H:WePMgeotla\0pe2lions Commigeel wmfions 2oo8wowcRoning Agee a.dw
Book Page 6
MINUTES OF THE
OPERATIONS COMMITTEE
Engineering, Operations & Maintenance, and Technical Services
Orange County Sanitation District
April 2, 2008—5:00 p.m.
A meeting of the Operations Committee of the Orange County Sanitation District was held on
April 2, 2008, at 5:00 p.m. in the Sanitation District's Administrative Office.
(2) ROLL CALL
Following the Pledge of Allegiance, a quorum was declared present, as follows:
Operations Directors Present: Staff Present:
Larry Crandall, Chair Jim Ruth, General Manager
Ken Parker, Vice Chair Bob Ghirelli,Assistant General Manager
Charles Antos Nick Arhontes, Dir. of Operations&Maintenance
Don Bankhead Jim Herberg, Director of Engineering
Rose Espinoza Ed Torres, Director of Technical Services
Patsy Marshall Lilia Kovac, Committee Secretary
Roy Moore Tod Haynes, Engineering Manager
David Shawver John Linder, Engineering Manager
Harry Sidhu Matt Smith, Engineering Manager
Constance Underhill Jim Bunor
Don Webb Mark Esquer
James M. Ferryman, Board Chair Vlad Kogan
Doug Davert, Board Vice Chair Mike Moore
Simon Watson
Operations Directors Absent: Chuck Winsor
Others:
Gino Rapagna, IPMC
(3) APPOINTMENT OF CHAIR PRO TEM
No appointment was necessary.
(4) PUBLIC COMMENTS
There were no public comments.
(5) REPORT OF THE COMMITTEE CHAIR
Chair Crandall reported that the tunnel work was completed on Ellis Street, and the road was
now open to traffic.
Book Page 7
Minutes of the Operations Committee
April 2, 2008
Page 2
(6) REPORT OF THE GENERAL MANAGER
Jim Ruth, General Manager, did not give a report.
(7) CONSENT CALENDAR ITEMS
a. MOVED, SECONDED, AND DULY CARRIED: Approve minutes of the March 5, 20D8
Operations Committee meeting.
b. OP08-10 MOVED, SECONDED, AND DULY CARRIED: Recommend to the Board
of Directors to: 1)Approve a Professional Services Consultant Agreement
with Boyle Engineering for the Corrosion Standards Update, Specification
No. CS-2007-344BD, in an amount not to exceed $291,445; and
2)Approve a 19%contingency ($55,374).
C. OP08-11 MOVED, SECONDED, AND DULY CARRIED: Recommend to the Board
of Directors to: 1)Approve plans and specifications for P1 Multiple
Locations Office Modifications, Project No. SP-127, on file at the office of
the Clerk of the Board;
2)Approve Addenda No. 1 and No. 2 to the plans and specifications;
3) Receive and file bid tabulation; and,
4) Reject all bids for P1 Multiple Locations Office Modifications, Project
No. SP-127.
d. OP08-12 MOVED, SECONDED, AND DULY CARRIED: Recommend to the Board
of Directors to: 1)Approve a Professional Consultant Services Agreement
with RBF Consulting, Inc. for the Carbon Canyon Sewer and Pump
Station Abandonment, Contract No. 2-24-1, providing for construction
support services for an amount not to exceed $498,129; and,
2)Approve a 10% contingency($49,813).
e. OP08-13 MOVED, SECONDED, AND DULY CARRIED: Recommend to the Board
of Directors to: 1) Approve Amendment No. 1 to Cooperative Projects
Grants Program Contract No. 0502 with City of Newport Beach, providing
for an 18-month time extension with no expanded scope of work, and no
increase of grant funding; and,
2) Approve Amendment No. 2 to Cooperative Projects Grants Program
Contract No. 0602 with Garden Grove Sanitary District, providing for a
six-month time extension.
Book Page 8
Minutes of the Operations Committee
April 2,20D8
Page 3
f. OPOB-14 MOVED, SECONDED, AND DULY CARRIED: Approve an increase in
the contingency to the purchase contract for Purchase and Installation of
Modular/Systems Furniture, Specification No. E-2007-353BD, for an
additional 20% ($25,124) increasing the total contingency to 40%
($50,248).
END OF CONSENT CALENDAR
g. No items considered.
(8) ACTION ITEMS
a. OP08-15 MOVED, SECONDED, AND DULY CARRIED: Recommend to the Board
of Directors to: 1)Approve the renewal of Purchase Order No. 101758-
OB for the purchase of Cationic Polymer, Specification No. C-2003-143,
issued to Polydyne Inc., with a unit rate increase of$0.13 per active
pound for Solution Polymer increasing the total price to$1.88 per active
pound plus tax, and a unit rate increase in Mannich Polymer of$0.153,
increasing the total price to $1.682 per active pound plus tax, for an
estimated amount of$1,950,000 for the period July 1, 2008 through June
30, 2009.
2)Authorize a 10°/u ($195,000) contingency.
(9) INFORMATIONAL ITEMS
a. OPOB-16 Emerging Issue: Climate Change and Greenhouse Gas Emissions
Director of Technical Services, Ed Torres, introduced the subject to the
Operations Committee members as an emergent issue. He introduced
Mike Moore, Environmental Assessment Manager, who provided a broad
overview of climate change, pending legislation, and its effects on water
supply.
(10) DEPARTMENT HEAD REPORTS
Director of Engineering,Jim Herberg, reported the Sanitation District had been the recipient of
the Primavera Excellence Award. Mr. Herberg also presented the progress of the Capital
Improvement Program, the consent decree accomplishments, and the CIP program based on
the Proposition 218-approved rates and the 5-year plan.
Director of Operations and Maintenance, Nick Arhontes, briefly presented an update on the
North County Yard construction progress including a cost saving approach on railroad facilities
to be removed by OCS. He also reported two leaks were discovered at Plant 1 underground
primary influent feed lines, and another underground leak at the metering probe manholes on
Book Page 9
Minutes of the Operations Committee
April 2, 2008
Page 4
the Plant 2 main outfall. These leaks require emergency repairs and the costs are expected to
exceed $200,000. Ratification for the emergency repairs will be submitted to the Board of
Directors for approval. It was also reported that damage to one of the Plant 2 pumps was
incurred during outfall pump system testing.
Director of Technical Services, Ed Torres, reported Sanitation District staffs involvement with
the National Water Research Institute (NWRI)as members of the Blue Ribbon Panel, evaluating
the amount of disinfectants used on the discharged water. Mike Moore provided a brief report
of his attendance at a wastewater conference in Mexico City; and a brief report of a biosolids
spill on the 1-5 Freeway in Hollywood.
(11) OTHER BUSINESS. COMMUNICATIONS OR SUPPLEMENTAL AGENDA ITEMS. IF ANY
Board Vice Chair Doug Davert reported that he presented the pictures of the concrete grout
debris removal process from the regional sewer at Tustin's council meeting and it was received
with much interest. It was then suggested that the Sanitation District provide more educational
programs to the cities for viewing on local cable channels. Chair Crandall reported that staff will
be presenting a report on pharmaceuticals found in the wastewater to the GW RS Steering
Committee.
(12) CLOSED SESSION
There was no closed session.
(13) ADJOURNMENT AND FUTURE MEETING DATES
The Chair declared the meeting adjourned at 6:15 p.m. The next Operations Committee
meeting is scheduled for Wednesday, May 7, 2008, at 5:00 p.m.
Submitted by: e
L is K vac
Committee Secretary
H Vep8a0enda\Ope28ons Commiftw\Ope20ons 20080408\040208 Open Mlnutm.do=
Book Page 10
OPERATIONS COMMITTEE pleenne Dace TO Bd.urd,.
05/07/08 05/21/0B
AGENDA REPORT Rem Number Item Number
Orange County Sanitation District oP08-17
FROM: James D. Ruth, General Manager
Originator: Edward M. Torres, Director of Technical Services
SUBJECT: Sale of Surplus Emission Reduction Credits
GENERAL MANAGER'S RECOMMENDATION
• Authorize the General Manager to sell surplus emission reduction credits via
negotiated contracts with ICAP United Inc., and Cantor CO2e, LP, in a form approved
by General Counsel.
SUMMARY
• The District currently owns over 700 lb/clay of VOC ERCs; South Coast Air Quality
Management District (SCAQMD) emission reduction credits (ERC)for Reactive
Organic Gases (commonly referred to as VOC's).
• District staff accounted for the amount of ERCs required for our own Capital
Improvement Projects in order to get permits for construction and operation and have
determined that a surplus of up to four hundred pounds per day of VOC ERCs exists.
• Market prices for one pound of VOC ERCs in April 2006, were $2,000 and recently
reached an all time high of$18,000. The current average market price of one pound
per day of VOC ECRs is approximately $16,000. For 400 Ibs of VOC ERCs this
equates to $6.4 million dollars.
• Staff recommends that we sell the 400 Ibs of VOC ERC's due to high market value
and because the SCAQMD is considering devaluating old ERCs that have not been
used in years.
• Staff recommends contracting with two experienced ERC brokerage firms, ICAP
United Inc., and Cantor CO2e, LP, rather than pursuing an RFP process in order to
take advantage of the current high market value and avoid a possible devaluation of
the market price due to public perception of"flooding the market"with our ERCs.
• ICAP is the only existing broker to have previously structured ERCs transactions for
OCSD and CantorCO2e is the world's longest standing environmental brokerage
created to serve companies in the carbon constrained economy and is active in
the South Coast AQMD VOC ERC market. .
Form No.otv=-x a ,W DMM7
Page 1
Book Page I I
PRIOR COMMITTEE/BOARD ACTIONS
None
ADDITIONAL INFORMATION
• An ERC is a credit earned by a company when it reduces air emissions beyond what
is required by existing permits and rules. It is an asset that can be used by its owner
or sold or traded to companies that need emission offsets for project development.
• The vast majority of the District's ERCs came from the retirement of 23 diesel
engines when the Central Power Generation system came on line in 1992.
Form No.ow402-4 PemeaE oLotNl
Page 2
Book Page 12
OPERATIONS COMMITTEE MeeOngDale TOB .orOr.
asio�ioa osnaioe
AGENDA REPORT Item Number Item Number
OPOa 1B
Orange County Samtatlon Datnct
FROM: James D. Ruth, General Manager
Originator: Nick Arhontes, Director of Operations and Maintenance
SUBJECT: CONTRACT FOR MAGNESIUM HYDROXIDE, SPECIFICATION NO.
C-2005-244, FOR ODOR AND CORROSION CONTROL IN THE
COLLECTION SYSTEM
GENERAL MANAGER'S RECOMMENDATION
1) Approve Change order No. 5 to the contract issued to Hill Brothers Chemical
Company for the Purchase of Magnesium Hydroxide, Specification
No. C-2005-244, authorizing a unit rate increase of$0.20 per gallon, for a total
unit price of$1.84 per gallon, plus applicable sales tax for a one-year period
effective July 1, 2008 through June 30, 2009, and all other terms of the contract
shall remain in effect (P.O. 102362 OB).
2) Authorize a 10% unit cost escalation contingency.
SUMMARY
The proposed Change Order No. 5 for the unit price increase of$0.20 per gallon will
provide additional services to supply, operate, monitor, and maintain chemical dosing
systems to cost effectively control hydrogen sulfide to specified target limits. This
includes installation, upgraded chemical storage and dosing equipment, advanced
wireless remote monitoring system, and additional labor for field sampling.
PRIOR COMMITTEEIBOARD ACTIONS
Approved contract award for Hill Brothers Chemical Company on November 16, 2005,
Agenda Report OMTS05-54.
ADDITIONAL INFORMATION
Magnesium hydroxide is a non hazardous chemical and has been used successfully
in our collection system odor and corrosion treatment program since September
2002.
H'.Wept�gen LIOMmUons OommlXeelOpmallons 20UBW508WB-18.0 2005-244.Mag Hydrox.tloc
Rw .00i01ro1
Page 1
Book Page 13
• Continuous treatment with magnesium hydroxide provides odor control odor by
slightly raising the pH of the sewage to reduce the formation of hydrogen sulfide.
Hydrogen sulfide combines with moisture in the sewer and forms sulfuric acid which
then corrodes unprotected concrete and certain metals.
• OCSD staff will be conducting random sampling and lab analysis of the delivered
chemical to assure quality and contract compliance.
This authorization complies with authority levels of the Sanitation District's Delegation of
Authority. This item has been budgeted in Divisions 420, 830, and 840, line item 55.
Award Date: November 2005 Contract Amount: $1.64/gal. +tax Contingency: 6%
May 2008 Contract Amount: $1.84/qal. +tax Contingency: 10%
M^4eglagxgawpnaEona Ca Mm%Op .,2008bSO =-l6.G-2g 2"Mag HOMX.dw
R—• p IM7
Page 2
Book Page 14
OPERATIONS COMMITTEE Neeb09We 4ad.ufolr.
05/07/08 os/7R/o9
AGENDA REPORT roeM OS-19 Item Number
Nu
Orange County Sanitation District
FROM: James D. Ruth, General Manager
Originator: Nick Arhontes, Director of Operations and Maintenance
SUBJECT: CONTRACT FOR ANIONIC POLYMER, SPECIFICATION NO.
C-2006-273
GENERAL MANAGER'S RECOMMENDATION
1) Authorize the General Manager to approve renewal of a contract, with
Neutron Chemicals, Inc., for Purchase of Anionic Polymer, Specification No.
C-2006-273, authorizing a price increase of$.015/Ib, for a total price of
$3.00/lb, for a one-year period effective September 1, 2008 through August
31, 2009 (P.O. 102810-OB).
2) Authorize a 10% cost escalation contingency
SUMMARY
• Neutron, our current supplier, has provided data to purchasing/contracts staff to
substantiate their request for increase. This is due to the recent increase in the cost
of the raw materials used to manufacture anionic polymer coupled with higher fuel
prices. It is staffs opinion, the request is reasonable.
• Staff has determined that the remaining contract renewals will not be exercised, and
this contract will be rebid in 2009.
PRIOR COMMITTEE/BOARD ACTIONS
None
ADDITIONAL INFORMATION
Anionic polymer and ferric chloride are added to the primary influent at both plants to
enhance the removal of BOD and improve the settling of suspended solids during
primary treatment. We call this our chemically enhanced primary treatment (CEPT)
process.
This item has been budgeted for divisions 830 and 840 in Operating Budget line items
48.
Award Date: June 2006 Contract Amount: $2.85/lb+tax Contingency:00%
Mav 2006 Contract Amount: $3.00/Ib+tax Contingency: 10%
FOM N0.DMI02-2 R...1YP.07
Page 1
Book Page 15
OPERATIONS COMMITTEE Mee0n8 Date To9d.of Dlr.
0 07108 05/2a/08
AGENDA REPORT 1e Number Item Number
OPae-20
Orange County Sanitation District
FROM: James D. Ruth, General Manager
Originator: Nick Amontes, Director of Operations & Maintenance
SUBJECT: CONTRACTS FOR THE PURCHASE OF SODIUM HYDROXIDE,
SPECIFICATION NO. C 2008-371 BD FOR ODOR CONTROL IN THE
COLLECTION SYSTEM AND PLANTS.
GENERAL MANAGER'S RECOMMENDATION
1. A. Award a contract to Olin Chlor Alkali Products, for the Purchase of Sodium
Hydroxide (Caustic Soda) 25% solution, Specification No. C-2008-371 BD,
for delivery to the plants for the period July 1, 2008 through June 30,
2009, for a unit price of$459.90 per dry ton plus freight of$200-00 per dry
ton, plus applicable sales tax for an estimated annual amount of
$431,235.00, with four one-year renewal options; and,
B. Authorize a 10% annual cost escalation contingency.
2. A. Award a contract to Basic Chemical Solution, LLC, for the Purchase of
Sodium Hydroxide (Caustic Soda) 50% solution, Specification
No. C-2008-371 BD, for delivery in the collection system, for the period
July 1, 2008 through June 30, 2009, for a unit price of$539.00 per dry ton,
subject to the Harriman Chemsult Limited Index, plus freight of$39.48 per
dry ton, plus applicable sales tax for an estimated annual amount of
$235,075.00 with four one-year renewal; and,
B. Authorize an 8% quarterly cost escalation contingency.
SUMMARY
• A formal bid package was mailed to 15 vendors. Thirteen vendors did not respond,
and two responded. The bids were opened on April 15, 2008.
• The cost escalation factor is based on the Harriman Chemsult Limited Index and the
prices continue to increase in the West Coast regional markets. Caustic soda supply
on the West Coast is very tight and the expectation is that unit prices will continue to
increase. As a result, Basic Chemical Solution, LLC, price is firm for 90 days of the
bid acceptance period and then with quarterly price protection thereafter.
Conditionally, the unit price for the 50% solution caustic soda would be adjusted
based on the Harriman Chemsult Limited Index.
Form No.o IW 2 v Co,ww 0 0 .-M- e
Page 1
Book Page 16
PRIOR COMMITTEE/BOARD ACTIONS
Specification No. C-2005-22OBD approved on May 25, 2005, Agenda Report OMTS05-
26,
ADDITIONAL INFORMATION
• OCSD has an established odor control program that consists of adding several
chemicals in both the collection system and treatment plants to control hydrogen
sulfide formation. This is a common by-product of the wastewater collection and
treatment process that causes nuisance odors and also leads to the formation of
sulfuric acid which corrodes unprotected concrete and metal structures.
• Sodium hydroxide (also called lye, or caustic soda), in conjunction with bleach or
hydrogen peroxide is also added to the chemical scrubbers at the treatment plants to
remove hydrogen sulfide from the odorous air from the sewers and also treatment
processes.
• The goal of adding sodium hydroxide in the collection system is to dose specific
trunklines that are not treated by the four continuous-chemical feed stations in the
region. For these sewers, sodium hydroxide is batch dumped from the supplier's
tank truck. This helps maintain hydrogen sulfide levels in the sewage at target levels
determined thru sampling and monitoring by staff.
This complies with authority levels of the Sanitation District's Delegation of Authority.
This item has been budgeted in Division 420, 830, and 840, line item 51.
Award Date: June 2008 Contract Amount: $659.90/dry ton+tax(25%)Contingency: 10%annual
Award Date: June 2008 Contract Amount: 8578.48/dry ton+tax(50%)Contingency: 8% quarterly
Forth NO.DW-102-2 VEUSCO.M CWOLO flw 04M-0
Page 2
Book Page 17
OPERATIONS COMMITTEE Meeang Dale TO 13d of Dir.
os/m/oe 01/21108
AGENDA REPORT ImmP Da Nu-2m1ber Item Number
O
Orange County Sanitation District
FROM: James D. Ruth, General Manager
Jim Herberg, Director of Engineering
SUBJECT: COOPERATIVE PROJECTS GRANTS PROGRAM
GENERAL MANAGER'S RECOMMENDATION
Approve Amendment No. 1 to Cooperative Projects Grants Program Contract No. 0604 with
Midway City Sanitary District, providing for an 11-month time extension.
SUMMARY
• The Cooperative Projects Grants Program (Program) provides funds to local agencies
for projects that reduce or eliminate inflow and infiltration (1/1) to the sewer collection
system.
• The Midway City Sanitary District (MCSD) requests Amendment No. 1 to Cooperative
Projects Grants Program Contract No. 0604, to provide for an 11-month time extension
to complete the project.
• In FY 05106, the Orange County Sanitation District's (OCSD) Program budget was
reduced to fulfill its obligation to only outstanding grants; MCSD has two outstanding
grants. Funding will be moved to accommodate the time extension.
PRIOR COMMITTEE/BOARD ACTIONS
In July 2006, the Board of Directors approved Contract No. 0604 for$519,750 in grant
funds to MCSD.
ADDITIONAL INFORMATION
Cooperative Projects Grants are paid to local agencies on a reimbursement basis after
project completion. The total amount of grant reimbursements provided to member
agencies since 1999 through the Program is approximately $23.1 million.
The MCSD has been identified as having a localized inflow problem by the OCSD long-term
flow monitoring efforts.
Under Cooperative Project No. 604 (CP-604), the MCSD is to replace and upsize
approximately 3,780 linear feet (If) of sewer to provide sufficient capacity for development
and redevelopment projects. The new sewer and manhole rehabilitation are to reduce III in
specific areas of MCSD Basin 22.
Page 1
Book Page 18
The Project completion date was projected for May 31, 2008. The Contractor was awarded the
project in December 2007. The Contractor was to begin work in January 2008, but has
experienced a major setback in his current project that has caused this project to be delayed.
The MCSD would like to retain this Contractor, since he has performed work for the MCSD in
the past, and his bid is approximately 75% of the anticipated construction cost. The funds
necessary to complete the upsizing of the sewer will be contributed by both the Garden Grove
Sanitary District(GGSD) and the MCSD on a proportional basis. The total project cost is
$2,310,000; GGSD will provide $1,270,500, MCSD will provide $519,750, and OCSD is to
provide $519,750. No additional funds are being requested by the agencies.
In reviewing the overall benefits to OCSD, staff is recommending that an 11-month time
extension to CP-604 be considered for approval. The new pipeline will reduce local 1/1 in
specific areas and increase capacity, thereby reducing the risk of sewer spills in MCSD and
GGSD.
ATTACHMENT
1. Letter from Midway City Sanitary District
2, Revised Exhibit C — Schedule
AA:sa
H:Wep0agendakowmtions committee\Operation 20=050a108-21.Coop Pmie s.doc
Page 2
Book Page 19
eowdorelree m
Tn,one oieP
Greoe P.Epperean
AI P.
Joy L Neug Neegebeuer
Meigle L Riee
Acdng General Mauner
xen Robbins
March 24, 2008
Orange County Sanitation District
Mr. John Linder, Engineering Manager
P.O. Box 8127
Fountain Valley, CA 92728-8127
Subject: Cooperative Projects Contract No. 0604 Replace Approximately 3,780
Lineal Feet of Sanitary Sewer Line Request for Contract Revision.
Dear Mr. Linder:
The Midway City Sanitary District (MCSD) has entered into Cooperative Projects
Contract No. 604 with the Orange County Sanitation District (OCSD) for replacement of
3,780 feet of sewer pipe to reduce inflow and infiltration within MCSD Basin. The Project
completion date was projected for May 31, 2008. However the MCSD work effort for the
subject project has been delayed. The Contractor was awarded the project in December
2007. The Contractor had intended to start work in January 2008 but ran into major
problems on his current project, thus affecting this project schedule. The MCSD would
like to continue to retain this Contractor, since he has done work for our District in the
past and his bid is approximately 75% of our anticipated construction cost.
However, the MCSD will require additional time to complete the Project. The Midway
City Sanitary District respectfully requests that OCSD consider a time extension to CP-
604. Our estimated completion date is November 30, 2008, with final report and invoices
submitted to OCSD by April 30, 2009, as illustrated in the enclosed updated schedule,
Revised Exhibit C.
Thank you very much for your assistance and allowing our District to participate in the
Cooperative Projects Program.
If any additional data is required, please contact our District Consultant Engineer, Don
Greek, at (714) 568-0200, ext. 207.
14461 cedanvood Avenue a Westminster,California 92683 a (714) 893-3553 a Fax(714)891-8624
www.mcsondstcom
Rook Paee 20
Letter to J. Linder
3124/08
Page 2
Very truly yours,
e Robbins
Acting General Manager
Midway City Sanitary District
Attachment— Revised Exhibit C
14451 Cedamood Avenue•Westminster, California 92683 • (714) 893-3553 Fax (714)891-8624
w .mcsandstcom
Book Page 21
3/24108
REVISED EXHIBIT C
PROJECT MILESTONE SCHEDULE
PIPELINE REPLACEMENT
MILESTONE COMPLETION DATE REQUESTED REVISION
TASK 1: Contract Executed by OCSD October 2006
TASK 2: Begin Project Design November 2006
TASK 3: Permitting Process February 2007
TASK 4: Solicit Bids
Award Construction Contract March 2007 December 2007
TASK 5: Construction Phase March 2008 November 30, 2008
TASK 6: Final Report and Invoice Submittal May 2008 Aril 30, 2009
OPERATIONS COMMITTEE M-In'
Deee Toed.o01N
05/07/08 05/28/ 8
AGENDA REPORT item Number Rem Number
OP08-22
Orange County Sanitation District
Colliomi
Facilities
FROM: James D. Ruth, General Manager
Originator: Jim Herberg, Director of Engineering
Project Manager: Alberto Acevedo
SUBJECT: REHABILITATION OF DISTRICT SIPHONS, CONTRACT NO. 2-68
GENERAL MANAGER'S RECOMMENDATION
1. Approve a budget increase of$128,100 for Rehabilitation of District Siphons,
Contract No. 2-68, for a total budget of$7,854,100.
2. Approve a contingency increase of$136,108 (3%) to the construction contract with
Ken Thompson, Inc., for Rehabilitation of District Siphons, Contract No. 2-68, for a
total contingency of$363,008 (8%).
SUMMARY
• This project rehabilitates 16 of the 87 siphons owned by the Orange County
Sanitation District (Sanitation District) within the service areas. The rehabilitation
includes all work necessary to install foul air by-pass lines at each of the 16 siphons
to minimize odor impacts.
• The contractor is near 40% completion for the project. However, as the project
progresses, multiple inaccuracies of record drawings provided to the consultant and
undisclosed utilities have created a substantial amount of field modifications to the
original construction recommendations. In addition, several cities have requested
additional changes to the original drawings creating additional cost to the project.
These include mostly additional paving requirements.
PRIOR COMMITTEEIBOARD ACTIONS
• August 2007—Approval of contract with Ken Thompson for a total amount not to
exceed $4,537,600 and a 5 % contingency.
• July 2007—Approval of Amendment No. 2 to the PSA with Dudek &Associates, Inc.
for$310,088, increasing the total amount to not to exceed $1,461,244.
Form No.DW-102-2 Revised 03/01/07
Page 1
Book Page 23
• February 2007 —Approval of Amendment No. 1 to the PSA with Dudek &
Associates, Inc. for$164,000, increasing the total amount not to exceed $1,151,156.
• November 2006—Approval of a Budget increase of$2,200,000 to the construction
contract budget, for a total construction budget of$ 4,700,000.
• October 2004—Approval of PSA with Dudek &Associates, Inc. for an amount not to
exceed $987,156.
ADDITIONAL INFORMATION
This request for increase in the project contingency complies with authority levels of the
Sanitation District's Delegation of Authority. This item has been budgeted (Page A-6,
Item No. 9).
Award Date: 8/22107 Contract Amount: $4,537,600 Contingency: $226,900 (5%)
5128/08 $136,108 (3%)
JH:AA:tic:gc
HinlglobalWgenda Draft Reporls\0perelionsV-68 AR Contingency Increase 5.7.08.doc
Forth No.DW402-2 Revised 03/01/07
Page 2
Book Page 24
OPERATIONS COMMITTEE Meeting Date Toad.01Dir.
05/07/08 os/23/oe
AGENDA REPORT aem Number Item Number
Ores-23
Orange County Sanitation District
Dig scion& Handling
8 lids
FROM: James D. Ruth, General Manager
Originator: Jim Herberg, Director of Engineering
Project Manager: Gino Rapagna
SUBJECT: SLUDGE DIGESTER REHABILITATION AT PLANT NO. 1,
JOB NO. P1-100
GENERAL MANAGER'S RECOMMENDATION
Approve a contingency increase of$623,114 (17%) to the Professional Design Services
Agreement with Earth Tech, Inc., for Sludge Digester Rehabilitation at Plant No. 1,
Job No. P1-100, for a total contingency of$989,652 (27%).
SUMMARY
• This project rehabilitates and upgrades ten anaerobic sludge digesters, two digested
sludge holding tanks, and appurtenant systems at the Orange County Sanitation
District's (Sanitation District) Plant No. 1.
• The Consultant is approximately 70% complete with preliminary and final design
services. The first element of the Preliminary Design Phase was to prepare an
Engineering Study Report to better define the project for preliminary and final
design. In contracting for design services, it was understood that contract
amendments would be considered as appropriate to complete the design based on
the findings of the Engineering Study Report. Approved Amendment No. 1
addressed required additional work performed during the preliminary design.
• To address required additional work to be performed during final design and to
enable consideration of the Consultant's pending request for Amendment No. 2,
additional PDSA contingency authorization is requested. The Consultant's request
for Amendment No. 2 is based on additional effort to be expended for preparation of
more design drawings than were anticipated during preparation of their proposal for
engineering services. These additional drawings relate to improvements to digester
heating systems, structural renovation, power and control modifications, chemical
feed system modifications, communication system upgrades, and miscellaneous
other items. Escalation for labor associated with the project taking longer than
anticipated for preliminary and final design is also included.
Form No.DW-102-2 Revised 03/01/07
Page 1
Book Page 25
• Based an the findings of the Engineering Study and Preliminary Design Reports, and
reconsideration of project resource requirements, revised staff, engineering, and
construction cost estimates have been developed. These estimates indicate that
reallocation of budget is necessary to complete components of the project. The
requested budget reallocation does not impact the overall project budget.
PRIOR COMMITTEEIBOARD ACTIONS
• February 2005-Approval of PSA with Earth Tech, Inc. for an amount not to exceed
$3,665,377 and establish a 10% contingency for design amendments.
ADDITIONAL INFORMATION
This request for increase in the project contingency complies with authority levels of the
Sanitation District's Delegation of Authority. This item has been budgeted (Page A-8,
Item No. 51).
Award Date: 2/23/05 Contract Amount: $3,665,377 Contingency: $366,538(10%)
5128/08 $623,114(17%1
989.652 f274F1.
JH:GR:tic:gc
H1oep1\agenda\0peraUons Commiltee\Owrations 2008\0508WB-23.P7-100 PSAooc
Form No.Dw102-2 Rev,sed 03101107
Page 2
Book Page 26
OPERATIONS COMMITTEE recenny Dab- T.00d of Dir.
oSimios oS128 8
AGENDA REPORT Item08-24 Iem Numbe
O Num
Orange County Sanitation District
Solids ng
Digestion
FROM: James D. Ruth, General Manager
Originator: Jim Herberg, Director of Engineering
Project Manager: Gino Rapagna
SUBJECT: SLUDGE DEWATERING AND ODOR CONTROL AT PLANT NO. 1,
JOB NO. P1-101
GENERAL MANAGER'S RECOMMENDATION
Approve a contingency increase of$2,003,323 (18%) to the Professional Design
Services Agreement with HDR, Inc. for Sludge Dewatering and Odor Control at Plant
No. 1, Job No. P1-101, for a total contingency of$3,116,281 (28%).
SUMMARY
• This project replaces existing sludge dewatering and solids area odor control
systems and installs primary sludge and waste activated sludge (WAS) thickening
systems at the Orange County Sanitation District's (Sanitation District) Plant No. 1.
• The Consultant is approximately 25% complete with preliminary and final design
services. The first element of the Preliminary Design Phase was to prepare an
Engineering Study Report to better define the project for preliminary and final
design. In contracting for design services, it was understood that contract
amendments would be considered as appropriate to complete the design based on
the findings of the Engineering Study Report.
is To address required additional work to be performed during preliminary and final
design, and to enable consideration of the Consultant's anticipated request for
Amendment No. 1, additional PDSA contingency authorization is requested. The
Consultant's request for amendment will be based on additional effort to be
expended for preparation of the Preliminary Design Report and more design
drawings than were anticipated during preparation of their proposal for engineering
services. The additional effort relates to the need for a larger than anticipated
thickening and dewatering building, existing biosolids storage and load out system
modifications, construction of a new tunnel for major pipe routing through the project
site, demolition of facilities to enable optimal siting of proposed odor control systems,
power building modifications, site piping and electrical modifications and
miscellaneous other items. Escalation for labor associated with the project taking
longer than anticipated for preliminary and final design will also be included.
Form No.DW-002.2 Revised 03/01/07
Page 1
Book Page 27
• Based on reconsideration of project resource requirements, revised staff and
engineering cost estimates have been developed. These estimates indicate that
slight reallocation of budget is necessary to complete components of the project.
The requested budget reallocation does not impact the overall project budget.
PRIOR COMMITTEE/BOARD ACTIONS
• May 2005 —Approval of Professional Design Services Agreement with HDR
Engineering, Inc. for an amount not to exceed $11,129,575.
ADDITIONAL INFORMATION
This request for increase in the project contingency complies with authority levels of the
Sanitation District's Delegation of Authority. This item has been budgeted (Page A-8,
Item No. 52).
Award Date: 5/25/05 Contract Amount: $11,129,575 Contingency: $1,112,958(10%)
5128108 $2,003,323(18%)
$a.1ls.zal 1za�).
JH:GR:tic:gc
H:Wep0agenda\Opemiions Commi8ee Operabons 2008W06N% 5-24.P1401 PSA.docx
Form No. DW-102-2 Revised 03/01/07
Page 2
Book Page 28
OPERATIONS COMMITTEE
Meetlng Date To etl,d qr.
AGENDA REPORT as/o�ioI osiNuft
Item N mper Ilem N ber
Orange County Sanitation District oFoe zc
Misc.8
Support Projects
FROM: James D. Ruth, General Manager
Originator: Jim Herberg, Director of Engineering
Project Manager: Matt Smith
SUBJECT: INTEGRATED PROGRAM MANAGEMENT CONSULTANTS
GENERAL MANAGER'S RECOMMENDATION
Approve Amendment No. 8 to the Professional Services Agreement with Integrated
Program Management Consultants, a joint venture of Parsons Water
and Infrastructure, Inc., and CH2M Hill, Inc., authorizing:
1) Establish an amount not to exceed $16,987,271 for year seven (Fiscal Year
2008/09) of the ten-year contract; and
2) Increase the total amount of the ten-year contract to an amount not to exceed
$93,077,246.
SUMMARY
• We are currently in the sixth year of a ten-year contract with Integrated Program
Management Consultants (IPMC). It is anticipated that the current Capital
Improvement Program (CIP) will require the use of IPMC at least through Fiscal
Year (FY) 2011-12 to coincide with the completion of the secondary treatment
projects.
• Staff will be working on 73 active projects during FY 2008-09 with a total projected
CIP expenditure in excess of$360,000,000. FY 008-09 represents the peak annual
cash expenditure in the 20-year CIP.
• A detailed planning effort, along with resource forecasting, has identified the need
for 70 IPMC staff to augment the Orange County Sanitation District (Sanitation
District) staff to complete next fiscal year's work. Most of the identified staff are
currently working on Sanitation District projects. New hires, and/or replacement staff
will be phased in over the fiscal year as required. IPMC will augment Sanitation
District staff in Division 740 (Planning), Division 750 (Project Management),
Division 760 (Engineering and Construction), and Division 770 (Facilities
Engineering). The functions that these staff will perform are described in more detail
below, along with the recommended budget for FY 2008-09.
Rm»]OYLIIJ)
Form No.W IW 2 Page 1
Rook Paee 29
The benefits provided by IPMC include the rapid mobilization of highly
skilled/technical staff, flexibility to change the mix of staff positions on an immediate,
and as-needed basis, the ability to quickly reduce staff as workloads decrease,
project controls expertise, and many years of experience working on similar
programs throughout the United States and the world. Staff believes that using a
Program Management Consultant approach is a practical, cost-effective, and
efficient way to augment Sanitation District staff to deliver the CIP during the next
four years of significant work.
PRIOR COMMITTEE/BOARD ACTIONS
• Operations Committee—May 2007 —Approval of Amendment No. 7 to the
Professional Services Agreement with Integrated Program Management Consultants
for$15,997,936, increasing the total amount not to exceed $76,089,975, and
extending the PDSA for an additional five-year period through FY 2011-12.
• PDC — May 2006—Approval of Amendment No. 6 to the Professional Services
Agreement with Integrated Program Management Consultants for $14,999,656,
increasing the total amount not to exceed $60,092,039.
• PDC —June 2005—Approval of Amendment No. 5 to the Professional Services
Agreement with Integrated Program Management Consultants for $15,585,558,
increasing the total amount not to exceed $45,092,383.
• PDC —June 2004—Approval of Amendment No. 4 to the Professional Services
Agreement with Integrated Program Management Consultants for$12,836,801,
increasing the total amount not to exceed $29,506,825.
• Board — June 2003 —Approval of Amendment No. 3 to the Professional Services
Agreement with Integrated Program Management Consultants for$150,000, and an
additional $12,484,750 for year two of the contract, FY 2003-04, increasing the total
amount not to exceed $16,670,024.
• PDC —June 2003—Approval of Amendment No. 2 to the Professional Services
Agreement with Integrated Program Management Consultants for$50,000,
increasing the total amount not to exceed $4,035,274.
• PDC —June 2003—Approval of Amendment No. 1 to the Professional Services
Agreement with Integrated Program Management Consultants for $50,000,
increasing the total amount not to exceed $3,985,274.
• PDC —August 2002 —Approval of Professional Services Agreement with Integrated
Program Management Consultants for an amount not to exceed $3,935,274.
Forth No,D.IU-1
R.W0 p1N1
Page 2
Book Pape 3n
ADDITIONAL INFORMATION
Based on the current schedule and project workload, staff has estimated the level of
effort that will be required from IPMC through FY 2011-2012.
It is currently anticipated that no IPMC Staff will be required after FY 2011-2012;
however, staff will continually estimate the need for staff, both permanent and
temporary, to support the CIP.
The Sanitation District is continually evaluating whether to hire permanent staff and
reduce the number of IPMC staff. The estimate of IPMC staff required for each fiscal
year does not include the addition of more permanent Sanitation District staff which
would reduce the IPMC staff needs currently projected. For the anticipated ten-year
duration of the IPMC contract, the overall staff cost associated with the CIP is
approximately$428,000,000 (currently estimated at $301,000,000 for Sanitation District
staff, and $127,000,000 for IPMC staff). During this period of time, the Sanitation
District will be expending approximately $2,200,000,000 for engineering, design, and
construction of capital facilities. The $127,000,000 planned to be expended for IPMC
support equates to 5.8% of the total planned CIP expenditures.
The average hourly billing rate for IPMC staff during FY 2007-08 was approximately
$124/hr. IPMC billing rates include salaries, benefits, fixed costs which are sometimes
referred to as overhead (Buildings, Administration, Utilities, Insurance, etc.), and a 5%
profit. The "overhead" rate which is applied to an employee's raw salary is
approximately 145% for IPMC. As a comparison, the engineering consultants who
conduct studies and develop designs for the Sanitation District typically have an
overhead rate range of about 190 to 200%. IPMC overhead rate is 145% because the
Sanitation District is providing office space and equipment to their field staff.
The costs for IPMC will be charged to the individual CIP projects. Funding for IPMC
costs are included in individual project budgets. Each fiscal year, as projects are
planned, scheduled, budgeted, and resource needs identified, a projected cost will be
presented to the Operations Committee for approval. Semi-annual updates for the
entire program will also be provided.
Planning (Division 740)
IPMC is providing personnel to augment the Sanitation District's Planning staff. General
assignments and duties are as follows:
• IPMC will provide one Project Engineer (Gordon) to support planning efforts related
to preparation of the Strategic Plan Update.
• Two Electrical and Instrumentation & Control (I&C) Engineers (Woods, Lai) and one
Civil Designer/Computer Assisted Design & Drafting (CADD) Technician (Beltran) to
provide technical support for facility records and database management.
Fmm No.ow4@-2 FwIme02101N1
Page 3
Book Page 31
r
Project Management Office (PMO) (Division 750):
The PMO is home to the project management and project controls staff.
Project Management Staff:
In FY 2008-09, the PMO will be managing 73 active projects with a total budget of
$2,413,000,000. The project budget ranges in size from $1,000,000 to over
$200,000,000. The Sanitation District has completed a staffing analysis, and believes a
workload of three to six projects per Project Manager (PM) (based on size, and
complexity) is appropriate. IPMC will provide personnel to augment the Sanitation
District's Project Management Personnel in the PMO. The positions are described
below:
• One Program Manager (Rapagna) to provide general management and supervision
of all IPMC staff. The Program Manager will work with the Director of Engineering,
the PMO Manager, and the Engineering and Construction Manager to ensure
compliance with contracts, policies, and procedures. The Program Manager will
provide technical oversight and direction in all aspects of the program and help
ensure successful delivery of the CIP. The Program Manager manages technical
work executed by the home office staff.
• Four Project Managers (Acevedo, MacDonald, MacLeod, Schock) to supplement
seven Sanitation District Project Managers. The PMs provide day-to-day
management and technical knowledge to deliver the assigned projects.
• One Business Manager(Billhardt) to provide assistance in the areas of time
keeping, resources, accounting, and contracts management.
• One Administrative Assistant (Chamberlain) to provide clerical and general
administrative support, e.g., preparing agenda reports, general correspondence.
Project Controls Staff:
Currently there are 196 projects being tracked by the Project Controls Group. Of
these, 73 are active engineering projects, 33 are in the future, and 84 are cancelled or
completed. These projects require a variety of monthly updates including cost
reporting, development of performance measures, reports, and other presentation
materials. Each staff function is described below:
• One Project Controls Manager/Project Scheduler (Michael) to provide scheduling
and cost reporting support, QA/QC, technical oversight, and direction to controls
staff.
F.Wo O 'Qt RamaCo iw
Page 4
Book Page 32
• One Project Scheduler (GrosJean) to prepare project cost, and schedule updates
and milestone tracking in support of PMO Project Managers. Other duties
performed by the schedulers include assisting in the CIP budgeting process, cash
flow updates, preparation and updating of resource and workload planning
information, providing input to the preparation of the Engineering CIP Semi Annual
Report, and provide training and support to Sanitation District staff on the use of the
various computer software tools including P6, Access, and Business Object.
• One Project Scheduler (Gaus) to maintain and process the baseline cost and
schedule databases. Other duties include providing technical support to PMs in
preparing monthly and fiscal year cash flow analysis and report development,
preparation of PMO meeting presentation materials, and assisting in the preparation
of annual CIP updates and other programmatic cost and schedule reports.
• One Project Controls Analyst (Reichenbach) assigned to assist in time reporting,
charge numbers, and general quality assurance of data used in the system. Other
duties include preparation of the semi-annual reports, updating the PM Manual, and
maintaining portions of the automated weekly timesheet in PCS for Sanitation
District staff. She will also serve as part-time scheduler on a number of Engineering
CIP projects.
• Five Construction Cost Estimators (Brown, Collett, Davison, Villanueva,
Zimmerman) assigned to prepare estimates for change orders, help negotiate
changes during construction, review design consultant estimates, and provide cost
estimate input during the annual CIP validation process.
• One Construction Scheduling Lead (Alexander) to provide oversight on all matters
related to the construction field scheduling. Other duties include review and
guidance in the preparation of monthly construction schedule analysis reports
prepared by IPMC and the Sanitation District field scheduling personnel. Will also
participate in the preparation of time impact analysis and review of contractor
submitted claims.
• Five Construction Schedulers (Dedhia, Rodriguez, Sugasawara, two new hires)
assigned to ensure that contractors provide quality baseline schedules and keep
them current (a vital element in our claims avoidance program). Field Schedulers
review the contractor's initial schedule submittal and the schedule of values.
Monthly updates are required from the contractors, which must also be reviewed.
Progress claimed by the contractors must be reviewed against the schedule plan
each month for payment, and any request for additional time through change orders
must be analyzed.
• One Document Control Lead (Cazares) to provide document control expertise and
support for all aspects of CIP-related document management.
F0.No.D IM-R RrilxEMIW
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Engineering & Construction Management(Division 760)
IPMC is providing personnel to augment the Sanitation District's Engineering and
Construction Management (E&CM) staff. E&CM is responsible for providing all the
technical resources to the Project Managers. General assignments and duties are as
follows:
• Ten Resident Engineers/Construction Managers (Barth, Bomkamp, Bryan, Collins,
Cuellar, Haid, Rein, Waite, Vohra, one new hire) to support construction
management of CIP projects within the boundaries of the Sanitation District's two
operating treatment facilities and outside of the plant boundaries, i.e., for pipeline
and pump station contracts. They will utilize existing Sanitation District CM policies
and procedures to represent the Sanitation District, coordinate construction
activities, manage the construction contract, and document contractor compliance
with the contract requirements.
• Three Electrical and Instrumentation & Control (EI&C) Engineers (Corey, Etemadi,
one new hire). These Engineers are assigned to the CIP projects to provide
specialized technical support to the project teams during both the design and
construction phases. They ensure consultant and construction contractor
compliance with Sanitation District requirements, guidelines, and polices.
• Two Project Engineers (Aghanian, one new hire). Project Engineers serve as the
technical leads within the Sanitation District's project teams, and assist the PMs with
verification of the project elements, coordinating project requirements with the O&M
Department, developing the design consultant SOW, selecting the design
consultant, and ensuring the construction documents are prepared using the
Sanitation District standards. During the construction phase, they resolve design
questions and issues for the Resident Engineers.
• Six Civil/Mechanical Inspectors (Chemotti, Gilbert, Hough, Jimenez, Kwiecien, one
new hire), two Electrical Inspector (Whitney, one new hire), and four Instrumentation
& Control Inspector (Beck, Jordan, Stewart, one new hire) to support Quality
Assurance of CIP projects within the two Treatment Facilities. They will utilize
existing Sanitation District QA policies and procedures to represent the Sanitation
District, coordinate construction and O&M activities, monitor construction site safety,
and document contractor compliance with the contract requirements.
• Three Civil Inspectors (Daniel, Martin, Sankar) to support Quality Assurance of
pipeline and pump station projects. They will utilize existing Sanitation District QA
policies and procedures to represent the Sanitation District, coordinate construction
and traffic control activities, monitor construction site safety, and document
contractor compliance with the contract requirements.
• One Commissioning Specialist (new hire) to support commissioning and start-up of
CIP projects within the two Treatment Facilities.
F"No.U ,M.3 gmife]gYOtq)
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• Eight Administrative Assistants (Corona, Hays, Inman, Leavitt, Marquez, Moore,
Noya, Yousef) to provide a variety of administrative support including
Submittals/Document Clerks (Corona, Hays, Corona, Yousef) for processing and
tracking of construction contractor submittals; Project Administrative Assistant
(Moore) for processing project correspondence and filing; general administrative
support (Inman, Marquez, Noya) for processing project correspondence, Agenda
Reports, and preparing policy and procedures manual.
Facilities Engineering (Division 770)
IPMC is providing personnel to augment the Sanitation District's Facilities Engineering
staff. Facilities Engineering is responsible for providing Project Managers and technical
resources to implement miscellaneous small capital improvement projects to enhance
safety, reliability, and efficiency of facility operations. General assignments and duties
are as follows:
• One Project Manager(Davis) to provide day-to-day management and technical
knowledge to deliver the projects.
• One Project Engineer(Shah)and one Civil Designer/Computer Assisted Design &
Drafting (CADD)Technician (Tran) to provide technical support and assistance to
PMs for project implementation.
O&M Department Capital Project Support
The O&M Department provides technical support to the Engineering Department during
design and construction of CIP projects. IPMC will provide two Project Engineers
(Takahashi and Sharma) to coordinate input from O&M technical staff, and to represent
O&M at the various design and construction meetings. This support frees up the O&M
staff to perform their regular duties.
Home Office Support
"Home Office Support" is supplementary services from the offices of the Joint Venture
Parties, Parsons and CH2M HILL, made readily available to support the needs of the
Engineering Department. Technical study (task orders) work is based on providing
engineering and other technical support for specific assignments using a pre-agreed
upon scope of work, fee, and schedule. These tasks will be as authorized by the
Director of Engineering when required, and may include assistance in the following
areas:
• General Administration and Home Office Technical Support— general administration
support includes accounting, contract administration, invoices, reproduction, and
safety reports and reviews. Routine home office technical support includes urgent
technical support (usually task less than 40 hours) in all areas of waste water
engineering, construction, and project controls.
Fa,m No.O IW3 Ravleeoaamtm!
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• CEQA and NEPA Assistance— support to the Planning Division on a variety of
treatment, collections, and pump station projects in preparing environmental
documentation.
• O&M studies —Support O&M with studies on various issues.
• Community Outreach Support—assist the Communications Department as needed
on all collections projects in preparing outreach plans, conducting meetings, crisis
management plans, etc.
• IT and PCS systems programming support, including support for troubleshooting
and system upgrades.
• General technical support—throughout the year, issues come up which need
technical support and/or immediate attention. For example, in FY 07/08, IPMC
provided support related to office space and lobby improvements planning, grants
program assistance, tunnel construction, Expedition software configuration, technical
specification development and revision, constructability review, Construction Manual
editing, cost estimating.
ALTERNATIVES
Increase the Sanitation District's permanent Staff—This option would require a lengthy
process and extensive effort to recruit, hire, train, and make productive a large number
of new employees. It is also projected that staffing needs will vary from year to year,
and that after the completion of the consent order work, the Sanitation District will not
need these permanent staff to manage the future CIP. This option would not be
optimum for filling these varying needs.
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H:Wept gendMOWmflons Comminee10pe21ions 200810508108-25.IPMC M8.09.dm
FW No.D =-2 ge vm oLotN]
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OPERATIONS COMMITTEE MeebRga a rose.Dra..
asio2roe as�zeiae
AGENDA REPORT IQyn Numbe 'b Numbs
Orange County Samtatwn Datnc[ oP 26
FROM: James D. Ruth, General Manager
Originator: Lorenzo Tyner, Director of Finance and Administrative Services
SUBJECT: 2008-09 AND 2009-10 DISTRICT PROPOSED BUDGET UPDATE
GENERAL MANAGER'S RECOMMENDATION
Information item.
SUMMARY
This report will provide an overview of the District's 2008-09 and 2009-10 Proposed
Budget. The Proposed Budget will be presented to the full Board for adoption on
June 25, 2008.
Highlights of the Proposed 2008-09— 2009-10 Budget include:
1) Limited Growth
Total resource requirements are projected to grow by 15 percent for 2008-09 as the
projected budgeted expenditures ($589 million) represent a $76 million change from
the 2007-08 budgeted expenditures ($513 million). In the following year, however,
total resource requirements are projected to decrease by 18 percent as the
projected budgeted expenditures for 2009-10 are $481 million.
2) A revised Capital Improvement Program (CIP)
Staff projects that CIP expenditures for 2008-09, excluding debt service, ($359
million) will increase by 18 percent from the 2007-08 budgeted expenditures ($302
million). CIP expenditures are then expected to decrease by 32 percent to $244
million in 2009-10.
3) Strong Financial Position
The budget assumes ongoing revenues and reserve levels that are sufficient to
maintain the District's AA Bond Rating. Bonds rated AA are judged to be of high
quality by all standards.
4) Increased Staffing Levels
As previously described by the General Manager, the Proposed Budget includes a
1 percent increase in Full-Time Equivalent (FTE) positions in 2008-09 (641 FTE) and
2009-10 (648 FTE) as compared to an authorized total of 634 FTE in 2007-08. A
number of positions have also been changed or transferred between divisions to
better address operational priorities as new facilities come online.
Fmm No.DW-102] R...ONDN7
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13ouk Pace 37
5) Two-Year Budget
Staff has once again prepared a two-year budget. Because a separate CIP review
and approval process exists, a two-year budget is appropriate and more effective for
the District. Staff will provide annual updates on all major expense categories.
Two Year Budget Summary
Revenues: 2008-09 2009-10
Fees & Charges $219 million (37%) $242 million (46%)
General Income $117 million (20%) $116 million (22%)
Debt Proceeds $256 million (43%) $173 million (32%)
Total $592 million 5531 million
Expenditures: 2008-09 2009-10
CIP, including Debt $441 million (75%) $326 million (68%)
Treatment and Disposal Costs $148 million (25%) $155 million (32%)
Total 5589 million $481 million
PRIOR COMMITTEE/BOARD ACTIONS
None.
ADDITIONAL INFORMATION
The Budget Development Process
Staff completed a comprehensive list of assumptions to apply to the budget relating to
costs, revenue, rates, inflation, etc. These assumptions were subsequently
recommended by the Administration Committee and approved by the Board.
With these guidelines in mind, District finance staff reviewed all major District resources
and expenditures. The General Manager met with each department head and division
leader to review, discuss and prioritize each department's major activities.
These activities were also reviewed to ensure alignment with the District's goals. A
formal process for reviewing these goals will be established as a part of the annual
update of the District's Strategic Plan.
Revenues and Expenditures
Revenues
The Sanitation District obtains it revenues from three main sources:
200"9 2009-10
Fees & Charges $219 million (37%) $242 million (46%)
General Income $117 million (20%) $116 million (22%)
Debt Proceeds $256 million (43%) $173 million (32%)
Total 5592 million $531 million
Fom No.O Im J Rwlx].03N1N1
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2008-09 2009-10
A) Fees— $219 million (37%) $242 million (46%)
1) General User Fees $183 million $203 million
User fees are ongoing fees for service paid by customers connected to the sewer
system. A property owner, or user, does not pay user fees until connected to the
sewer system and receiving services. Once connected, a user is responsible for
his share of the system's costs, both fixed and variable, in proportion to his
demand on the system. These fees are for both Single-Family Residences
(SFR) and Multiple-Family Residences (MFR).
2) Permit User Fees $ 16 million $ 18 million
Permit fees are paid by large industrial and commercial property owners
connected to the sewer system. These fees are for the owner's share of the
system's costs, both fixed and variable, in proportion to his demand on the
system.
Since the inception of the Permit User Fee program in 1970, users of the
District's system that discharge high volume or high strength wastewater have
been required to obtain a discharge permit and pay extra fees for the costs of
service. The fees are initially calculated on the basis of actual flow, Biochemical-
Oxygen Demand (BOD), and Suspended Solids (SS) discharged to the sewer
and are subsequently reduced by the actual property taxes they have paid to the
District. This practice is intended to ensure that these users pay their actual cost
of service through a combination of user fees and property taxes.
3) Capital Facilities Capacity Charge (CFCC)
$ 20 million $ 21 million
The Capital Facilities Capacity Charge charged to newly connected customers
and to customers with facility expansions which indicate a potential for increased
flows. It is intended to pay for costs of future plant growth that is necessitated by
the additional capacity needed as customers connect or increase their flow
capacity.
The District's current rate structure allows for increases in CFCC in accordance
with the Engineering News Record (ENR) Index.
B) General Income—
$117 million (20%) $116 million (22%)
1) Property Taxes $ 65 million $ 68 million
The County is permitted by State law (Proposition 13) to levy taxes at 1 percent
of full market value (at time of purchase) and can increase the assessed value no
more than 2 percent per year. The District receives a share of the basic levy
proportionate to what was received in the 1976 to 1978 period less $3.5 million,
the amount that represents the State's permanent annual diversion
Form Na.O 1. Rewea'.0=1W
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from special districts to school districts that began in 1992-93. The District's
share of the 1 percent ad valorem property tax is dedicated for the payment of
COP debt service. The apportionment of the ad valorem tax is pursuant to the
Revenue Program of the Environmental Protection Agency and the State Water
Resources Control board and in accordance with COP documents and Board
policy.
As a resu@ of the State's previous fiscal crisis, the District received a 40 percent
reduction of its full allocation of property tax funds for fiscal years 2004-05 and
2005-06. The actual dollar amount of reduction was $32.4 million over this
two-year period. Although the funding level was restored in 2006-07, the State is
now in another fiscal crisis, and special district property tax revenue takeaways
are now again being considered by the State.
2008-09 2009-10
2) Interest $ 18 million $ 19 million
Interest earnings are generated from the investment of accumulated reserves
consisting of a cash flow/contingency, a capital improvement, a
renewal/replacement, and a self-insurance reserve.
3) Other $ 34 million $ 29 million
The Other General Income category is comprised of a variety of smaller dollar
items. Charges to Irvine Ranch Water District for Revenue Area 14's share of
the treatment plant's operating costs, capital costs, and equity are approximately
$26 million in 2008-09 and $21 million in 2009-10.
C) Debt— $256 million (43%) $173 million (32%)
1) Certificates of Participation (COP)
Certificates of Participation (COPS) are the District's primary mechanism for
financing capital projects. COPs are repayment obligations based on a lease or
installment sale agreement. COPS are not viewed as "debt" by the State of
California, but rather a share in an installment arrangement where the District
serves as the purchaser.
Expenditures
The District spends it funds on two activities:
2008-09 2009-10
CIP, including Debt $441 million (75%) $326 million (68%)
Treatment and Disposal $148 million (25%) $155 million (32%)
Total 8589 million S481 million
Form No.DW=3 Rwiaetl.0=1N7
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A) Capital Improvement Program (CIP) —
$441 million (75%) $326 million (68%)
The District's CIP can be divided into five distinct areas
1) Secondary Treatment Facilities
2) Ground Water Replenishment
3) Treatment Plant Rehabilitation and Upgrades
4) Collections
5) Debt
Also related to the CIP are the District's debt service payments. Primarily, debt is
issued to support the capital program because the program is too large to be
supported by a "pay-as-you-go" basis. Additionally, if the District were able to fund
these projects on a "pay-as-you-go" basis, there would be an equity issue to be
addressed, as current rate payers would fund all of the costs of projects for which
future rate payers would receive a portion of the benefits.
As previously mentioned, the District issues debt in the form of Certificates of
Participation (COPS). COPs are a forth of lease revenue bond that permits the
investor to participate in a stream of lease payments, installment payments or loan
payments relating to the acquisition or construction of specific equipment, land or
facilities.
2008-09 200940
8) Treatment and Disposal Costs—
$148 million (25%) $155 million (32%)
Staff projects $148 million and $155 million in 2008-09 and 2009-10 respectively to
perform the operations at the District's two treatment plants and other related
treatment activities, as well as support activities not directly charged to CIP.
Treatment and disposal activities include wastewater treatment processes, biosolids
disposal, disinfection and odor control. Expenditures for the purchase of chemicals
represent the largest non-salary related component of the budget. Support activities
include Regional Assets, Technical Services, and Administration.
JDR:LT:MW
Fom,No,orIM nw..ea.M1.7
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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