HomeMy WebLinkAbout2008-12 ADM MINUTES OF THE REGULAR MEETING OF
THE ADMINISTRATION COMMITTEE
Orange County Sanitation District
Wednesday, December 10, 2008, at 5:00 P.M.
A meeting of the Administration Committee of the Orange County Sanitation District was held on
December 10, 2008, at 5:00 p.m., in the Sanitation District's Administrative Office.
Following the Pledge of Allegiance, a quorum was declared present, as follows:
ADMINISTRATION COMMITTEE STAFF PRESENT:
MEMBERS: Jim Ruth, General Manager
Bob Ghirelli, Assistant General Manager
DIRECTORS PRESENT: Lorenzo Tyner, Director of Finance and
Mark Waldman, Chair Administrative Services
Phil Luebben, Vice Chair Lilia Kovac, Committee Secretary
Jon Dumitru Jeff Reed, Human Resources and Employee Relations
Jim Ferryman Manager
Don Hansen Mike White, Controller
Darryl Miller Rich Spencer, Employee Relations Supervisor
Chris Norby Kim Erickson
Brad Reese Laura Maravilla
Christina Shea Norbert Gaia
Sal Tinajero Juanita Skillman
Doug Davert, Board Chair Ryan Wheeler
Larry Crandall, Board Vice Chair Marc Brown
DIRECTORS ABSENT:
OTHERS PRESENT:
Jim Winder James Eggert, General Counsel
Bob Doter, Alternate Director
Bill Tugaw
PUBLIC COMMENTS
There were no public comments. - TF{ELp� TME�� p
�HAN(3 COERK OF Tf fE(BpARD
REPORT OF THE COMMITTEE CHAIR E UttTy .FIC DISTBtCT
Chair Waldman did not give a report. DEC 11/7 2000
REPORT OF THE GENERAL MANAGER ErP , 1C
General Manager, Jim Ruth, did not give a report.
Minutes of the Administration Committee
December 10, 2008
Page 2
REPORT OF DIRECTOR OF FINANCE AND ADMINISTRATIVE SERVICES
Lorenzo Tyner, Director of Finance and Administrative Services, reported that the issuance of
$198,000,000 of Certificate Anticipation Notes was complete. The refunding was originally
Issued at a variable rate of 3.85%, and was most recently at 4.75%, but reissuance brought it
down to a 0.98% rate for the next 12 months, saving the Sanitation District approximately $5 M.
REPORT OF GENERAL COUNSEL
General Counsel did not give a report.
CONSENT CALENDAR ITEMS (1 - 2)
1. Approve minutes of the November 12, 2008, meeting of the Administration Committee.
2. ADM08-38 MOVED, SECONDED, AND DULY CARRIED: Recommend to the Board
of Directors to approve the Deferred Payment Agreement negotiated by
the General Manager for the collection of all charges and fees owed for
sanitary sewer service charges and industrial discharge permit fees, plus
interest of 6.5% per annum, with American Apparel Knit & Dye, in a form
approved by General Counsel.
END OF CONSENT CALENDAR
INFORMATIONAL ITEMS (3 -4)
3, ADM08-39 OCSD's Deferred Compensation Program.
Mr. Bill Tugaw of SST Benefits Consulting presented the results of a
comprehensive review of providers of deferred compensation program,
performed by a panel of 11 participants from across the District.
Legislative regulatory compliance was of highest importance when rating
each plan, followed by high performance while reducing costs to
employees. A formal recommendation will be presented to the Board for
approval in January of 2009.
4. ADM08.40 OCSO's Employee Recognition Program.
Human Resources and Employee Relations Manager, Jeff Reed,
presented a brief overview and answered questions on the Employee
Recognition Program. The program rolls up existing recognition
programs into one, and is designed to foster a culture of appreciation and
recognition throughout the organization, while supporting the District's
mission, vision, core values and strategic goals. The Directors expressed
interest in acknowledging the recognized employees at Board meetings.
Minutes of the Administration Committee
December 10, 2008
Page 3
(5) CLOSED SESSION
There was no closed session.
(6) OTHER BUSINESS, COMMUNICATIONS OR SUPPLEMENTAL AGENDA ITEMS, IF
ANY
There were none.
(7) ADJOURNMENT
The Chair declared the meeting adjourned at 5:50 p.m. The next regular Administration Committee
meeting Is scheduled for February 11, 2009, at 5:00 p.m.
Submitted by:
Lilia Kovac
Committee Secretary
M:Wep0agendalAftin Commlttee12008M2081121008 Administration Minules.docz
ORANGE COUNTY SANITATION DISTRICT
Administration & Finance Meeting—December 10,2008
1. Review Committee Goals
• Comply with Legislative/Regulatory Requirements
• Exercise Due Diligence/Fiduciary Responsibility
• Eliminate Deferred Sales/Contingent Fees
• Reduce Overall Fees Distributed at the
• Improve Options/Fund Performance Admini tray Committee
• Enhance Service 0 Meeting
• Evaluate Ongoing Fund Performance
• Improve Participation
2. Review of RFP Finalist Process
• Selection of Finalists
• Review of Secondary Criteria
• Development of Questions/Issues
• Finalist Interviews
3. Review of Scenarios
• Superior Net Return to Participants
• Unanimous Selection of Scenario 1
4. Overview of Provider Fund Improvements
• Average Expense Ratios—Incumbent Plans
o AIG— 1.74%
o ICMA-RC— 1.10%(+.62%Administrative Fee)
o Lincoln— 1.77%
• Average Expense Ratio
o ING—.96%
o $220,000 Annual Savings (Average $485/participant)
• Contingent Deferred Sales Charges
o AIG- $282,000
o ICMA-RC—$0(12 Month Restriction)
o Lincoln-$213,000
o ING—CDSCEliminated
• Administrative Reimbursement Allowance
o $43,470
o $46,360
o $48,210
o $48,860
o $45,910
• Fixed Account—Stable Value Fund
o 4.25%(Lincoln accounts for 87% of total(3.7%)—Savings is$71,000
/$160)
• Morningstar Average Stars— Incumbents—2.8/ING—4.8
• ING Vanguard Funds—0.30%fees eliminated in Finalist Interview SST
YBENEFITS
CONSULTING
5. Service Improvements
• Representatives on site—3 days per week(all shifts)
• Investment Advice Services through Morningstar- $0 Participant Cost
• Customized web-site—Up in December
• Educational Services to Decision-makers/Participants
• Assume administrative Responsibility—UE, DROs, Loans, Catch-up
6. Unanimous Decisions to Select ING
7. Questions
SST
rrBENEFITS
CONSULTING
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 Administration Committee Meeting of Orange County
Sanitation District to be held on December 10, 2008, was duly posted for public
inspection in the main lobby of the Districts' offices on December 3, 2008.
IN WITNESS WHEREOF, I have hereunto set my hand this P day of December
2008.
Lille Kovac, Committee Secretary
Orange County Sanitation District
HADEMAGENDMADMIN COMMITTEBAGENDA CERTIFICATION.000
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ORANGE COUNTY SANITATION DISTRICT
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ADMINISTRATION COMMITTEE
MEETING DATES
Meetinq Date Board Meeting Dates
December 10, 2008 *December 17, 2008
January 2009 - Dark January 28, 2009
February 11, 2009 February 25, 2009
March 11, 2009 March 25, 2009
April 8, 2009 April 22, 2009
May 13, 2009 *May 20, 2009
June 10, 2009 June 24, 2009
July 8, 2009 July 22, 2009
August 2009 - Dark August 26, 2009
September 9, 2009 September 23, 2009
October 14, 2009 October 28, 2009
November 11, 2009 *November 18, 2009
December 9, 2009 *December 16, 2009
*Meetings being held the third Wednesday of the month.
ROLL CALL
ADMINISTRATION COMMITTEE
Finance, Human Resources and Information Technology
Meeting Date: December 10, 2008 Time: 5:00 p.m.
Adjourn:
COMMITTEE MEMBERS (13)
Mark Waldman Chair
Phil Luebben Ice Chair
Jon Dumitru
Jim Ferryman
Don Hansen
Darryl Miller
Chris Norb
Bred Reese
Christina Shea
Sal Tina ero
Jim Winder
Doug Davert Board Chair
Larry Crandall Board Vice Chair
OTHERS
Bred Ho in, General Counsel
STAFF
Jim Ruth General Manager
Bob Ghirelli, Assistant General Manager
Nick Arhontes, Dir. of Operations & Maintenance
Jim Herber , Director of Engineering
Ed Torres, Director of Technical Services
Lorenzo Tyner, Director of Finance and
Administrative Services
Lilia Kovac, Committee Secretary
Jeff Reed, Human Resources and Employee
Relations Manager
Mike White, Controller
H:WepPependM"n Coon itwe12a19112DSM Roll COMA=
AGENDA
REGULAR MEETING OF THE
ADMINISTRATION COMMITTEE
ORANGE COUNTY SANITATION DISTRICT
WEDNESDAY, DECEMBER 10, 2008, AT 5:00 P.M.
ADMINISTRATIVE OFFICE
10844 Ellis Avenue
Fountain Valley, California 92708
wwva.ocsd.com
PLEDGE OF ALLEGIANCE
DECLARATION OF QUORUM
PUBLIC COMMENTS
REPORT OF COMMITTEE CHAIR
REPORT OF GENERAL MANAGER
REPORT OF DIRECTOR OF FINANCE AND ADMINISTRATIVE SERVICES
CONSENT CALENDAR ITEMS (1 -2)
1. Approve minutes of the November 12, 2008, meeting of the Administration Committee,
2. ADMOB-38 Recommend to the Board of Directors to approve the Deferred Payment
Agreement negotiated by the General Manager for the collection of all
charges and fees owed for sanitary sewer service charges and industrial
discharge permit fees, plus interest of 6.5% per annum, with American
Apparel Knit & Dye, in a form approved by General Counsel. (Book Page 10)
INFORMATIONAL ITEMS (3 -4)
3. ADMO8-39 OCSD's Deferred Compensation Program. (Book Page 11)
4. ADM08-40 OCSD's Employee Recognition Program. (Book Page 15)
Book Page I
December 10, 2008 Page 2
CLOSED SESSION
During the course of conducting the business set forth on thin agenda as a reguter meeting of the Committee,
the Chair may convene the Committee in closed session to consider matters of pending reel estate negotiations,
pending or potential litigation,or personnel matters, pursuant to Government Code Sections 54955.8,54956.9,
54957 or 54957.6,as noted. i
Reports relating to (a) purchase and sale of real property; (b) matters of pending or potential litigation; (c) i
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 permitted closed session
and are not available for public inspection. At such time as final actions are taken by the Committee on any of
!,theae_subjeuts,.the.minutes vnll retied all required disclosures of ....................
Convene Convene in closed session.
5. CONFERENCE WITH LEGAL COUNSEL RE. ANTICIPATED LITIGATION (Government
Code Section 54956.9(b))
Significant Exposure to Litigation
Number of Potential Cases: 1
Reconvene in regular session.
Consideration of action, ff any, on matters considered in closed session.
6. Other business and communications or supplemental agenda items, if any.
7. Adjournment: The next regular Administration Committee meeting is scheduled for
Wednesday, February 11, 2009, at 5 p.m.
Book Page 2
December 10, 2008 Page 3
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 pdor to the meeting
date and time above. All public records relating to each agenda item, including any public records distributed less
than 72 hours prior to the meeting to all, or a majority of all, of the members of District's Board, are available for public
inspection in the office of the Clerk of the Board, located at 10844 Ellis Avenue, Fountain Valley, California.
Items Not Posted: In the event any matter not listed on this agenda is proposed to be submitted to the Committee for
discussion and/or action, it will be done in compliance with Section 54954.2(b) as an emergency item or because
there is a need to take immediate action, which need came to the attention of the Committee subsequent to the
posting of agenda, or as set forth on a supplemental agenda posted in the manner as above, not less than 72 hours
prior to the meeting date.
Public Comments: Any member of the public may address the Administration Committee on speck 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 Rem is requested to be removed from the consent calendar by a Director of staff
member,there will be no separate discussion of these items. All items on the consent calendar will be enacted by
one action approving all motions, and casting a unanimous ballot for resolutions included on the consent calendar.
All items removed from the consent calendar shall be considered in the regular order of business.
The Committee Chair will determine if any items are to be deleted from the consent calendar.
Items Continued: Items may be continued from this meeting without further notice to a Committee meeting held
within five(5)days of this meeting per Government Code Section 54954.2(b)(3).
Meeting Adioumment: This meeting may be adjourned to a later time and items of business from this agenda may be
considered at the later meeting by Order of Adjournment and Notice in accordance with Government Code Section
54955(posted within 24 hours).
Accommodations for the Disabled: The Board of Directors Meeting Room is wheelchair accessible. If you require
any special disability related accommodations, please contact the Orange County Sanitation District Clerk of the
Board's office at(714)593-7130 at least 72 hours prior to the scheduled meeting. Requests must specify the nature
of the disability and the type of accommodation requested
Notice to Committee Members:
For any questions on the agenda or to place any items on the agenda, Committee members should contact the Committee Chair
or Clerk of the Board ten days in advance of the Committee meeting.
Committee Chair: Mark Waldman (714)827-1969
Committee Secretary: Olia Kovac (714)593-7124 IkovactBiccsd.00m
General Manager: Jim Ruth (714)593-7110 iMhAmsd.mm
Assistant General Manager Bob Ghirelli (714)593-7400 mhirelliAgcsd.00m
Director of Finance and Lorenzo Tyner (714)593-7550 Itvnerrmocsd.com
Administrative Services
Human Resources and Employee Jeff Read (714)593-7144 ireedAmsd.00m
Relations Manager
H:\dept\agendaW dmin CommfaeeV008\120803.121008 Admin Agenda.dwx
Book Page 3
47 p
December 10,2008
ADMINISTRATION COMMITTEE
AGENDA CALENDAR
Item Action
.January DARK
February Renewal of Internal Audit Contract Action
February Budget Assumptions for 09-10 Budget Update Action
Book Page 4
MINUTES OF THE REGULAR MEETING OF
THE ADMINISTRATION COMMITTEE
Orange County Sanitation District
Wednesday, November 12, 2008,at 5:00 P.M.
A meeting of the Administration Committee of the Orange County Sanitation District was held on
November 12, 2008, at 5:00 p.m., in the Sanitation DistricPs Administrative Office.
Following the Pledge of Allegiance, a quorum was declared present, as follows:
ADMINISTRATION COMMITTEE STAFF PRESENT:
MEMBERS: Jim Ruth, General Manager
Jim Herberg, Director of Engineering
DIRECTORS PRESENT: Lorenzo Tyner, Director of Finance and
Mark Waldman, Chair Administrative Services
Phil Luebben, Vice Chair Lille Kovac, Committee Secretary
Jim Ferryman Jeff Reed, Human Resources and Employee Relations
Don Hansen Manager
Darryl Miller Mike White, Controller
Chris Norby Wes Bauer
Brad Reese Norbert Gets -
Christina Shea Juanita Skillman
Sal Tinajero
Jim Winder
Doug Davert, Board Chair OTHERS PRESENT:
Larry Crandall, Board Vice Chair Brad Hogin, General Counsel
Jennifer Farr
DIRECTORS ABSENT: Brian Gruber
Jon Dumitru Rich Kikuchi
Steven Parker
Ed Soong
PUBLIC COMMENTS
There were no public comments.
REPORT OF THE COMMITTEE CHAIR
Chair Waldman did not give a report.
REPORT OF THE GENERAL MANAGER
General Manager, Jim Ruth, did not give a report.
Book Page 5
Minutes of the Administration Committee
November 12, 2008
Page 2
REPORT OF DIRECTOR OF FINANCE AND ADMINISTRATIVE SERVICES
Lorenzo Tyner, Director of Finance and Administrative Services, did not give a report.
REPORT OF GENERAL COUNSEL
Brad Hogin, General Counsel, did not give a report.
CONSENT CALENDAR ITEMS (1 -2)
1. MOVED, SECONDED AND DULY CARRIED: Approve minutes of the November 12,
2008 meeting of the Administration Committee.
2. ADM08-33 MOVED, SECONDED AND DULY CARRIED: Recommend to
the Board of Directors to approve the reclassification of four(4)
OCSD positions affecting incumbents predicated on employees
satisfying position qualifications and the indefinite and ongoing
need to accomplish work at the higher level, and creation of a
new classification providing for:
a) Reclassification of two (2)Administrative Assistant positions
PG 67 ($6,185/month)to Contracts/Purchasing Assistant
PG 67 ($6,185/month) results in no change in pay;
b) Reclassification of a Senior EDM Specialist position PG 80
($8,121/month) to Senior Information Technology Analyst PG
83($8,743/month);
c) 1) Reclassification of a Principal Information Technology
Analyst position PG 87 ($10,133/month)to Principal Project
Controls Analyst PG 87 ($10,133/month) results in no
change in pay; and,
2) Creation of a new classification of Principal Project Controls
Analyst with pay range placement at PG 87 (Attachment 1).
ACTION ITEMS (3 -5)
3. ADMOB-34 Mike White, Controller, briefly provided an overview of the
Comprehensive Annual Financial Report (CAFR) for year end
June 30, 2008 prepared by Mayer Hoffman McCann.
Clarifications were made to Directors' questions, and minor
typographical errors on the CAFR were noted to be corrected.
It was then:
Book Page 6
Minutes of the Administration Committee
November 12, 2008
Page 3
MOVED, SECONDED AND DULY CARRIED: Recommend to
the Board of Directors to receive and file: a) Comprehensive
Annual Financial Report for the year ended June 30, 2008,
prepared by staff and audited by Mayer Hoffman McCann,
Certified Public Accountants;
b) Report on Compliance and Internal Control for the year
ended June 30, 2008; and
c) Report on Agreed-Upon Procedures Applied to
Appropriations Limit Worksheets.
4. ADMO8-35 MOVED, SECONDED AND DULY CARRIED to recommend to
the Board of Directors to: 1)Adopt Resolution No. OCSD 08-
20, Authorizing the Execution and Delivery by the District of
one or more Installment Purchase Agreements, Trust
Agreements, and Continuing Disclosure Agreements in
connection with the execution and delivery of Orange County
Sanitation District Certificates of Participation, Series 2008C,
and if necessary, Series 2009A, Authorizing the Execution and
Delivery of such Certificates Evidencing Principal in an
Aggregate Amount of Not to Exceed $200,000,000,Approving
the Distribution of one more Official Notice Inviting Bids and
Official Statements in Connection with the Offerings and Sales
of such Certificates and Authorizing the Execution of
Necessary Documents and Related Actions;
2)That the Orange County Sanitation District Financing
Corporation approve the documents supporting and
authorizing the Certificates of Participation, Series 2008C, and
if necessary, Series 2009A, in an aggregate amount not to
exceed $200 million.
Directors expressed concern over the request to execute and
deliver one or more installment of certificates of participation
without a specific rate or approval process. It was further
MOVED, SECONDED AND DULY CARRIED to recommend to
the Board of Directors to: 3) Establish a true interest cost
target rate of 4.75%with a maximum rate of 5.25%; and,
4) Obtain final approval of the Board Chair and Administration
Committee Chair prior to completing subject debt issuances.
Mr. Tyner advised the Directors that an additional item would
be going directly to the Board of Directors in November
requesting approval to refund variable rate debt under
Certificate Anticipation Notes until rates become more
favorable due to the current financial crisis,for a period not to
exceed 13 months.
Book Page 7
Minutes of the Administration Committee
November 12, 2008
Page 4
5. ADM08-36 MOVED, SECONDED AND DULY CARRIED: a) Ratify
Change Order No. 1 to P.O. 102681-OA, issued to Clean Harbors
Environmental Service, Specification No. S-2006-300,for
hazardous waste services for an additional amount of$50,000,for
a total contract amount not to exceed $158,150, for the contract
period ending December 31, 2008;
b) Approve Change Order No. 2 to P.O. 102681-OA, issued to
Clean Harbors Environmental Services, Specification No. S-2006-
300, for hazardous waste services, approving an increase of
$51,850, for a total contract amount not to exceed $160,000, for
the contract period January 1, 2009 through December 31, 2009,
and all subsequent renewal periods; and,
c) Approve an annual contingency of$16,000(10%).
END OF CONSENT CALENDAR
INFORMATIONAL ITEMS (6)
6. ADMO8-37 Internal Audit Reports
Controller Mike White introduced Rich Kikuchi and Brian Gruber of Lance,
Soil 8, Lunghard, LLP, who then proceeded to review the audits' results
which included contract change orders, Integrated Project Management
Consultants(IPMC) operating agreement, CIP billing of design and
construction progress payments, and travel and expense documentation
and controls.
(7) CLOSED SESSION
There was no closed session.
(8) OTHER BUSINESS, COMMUNICATIONS OR SUPPLEMENTAL AGENDA ITEMS, IF
ANY
There were none.
(9) MATTERS WHICH A DIRECTOR MAY WISH TO PLACE ON A FUTURE AGENDA FOR
ACTION AND STAFF REPORT
There were none.
Book Page 8
Minutes of the Administration Committee
November 12, 2008
Page 5
(10)ADJOURNMENT AND FUTURE MEETING DATES
The Chair declared the meeting adjourned at 6:08 p.m. The next regular Administration Committee
meeting is scheduled for December 10, 2008, at 5:00 p.m.
Submitted by:�
Lilia Kovac
Committee Secretary
H1dep0agendatAdmin Committeet200M120MO5.MInutes_Admin 111208.dm
Book Page 9
ADMINISTRATION COMMITTEE Meeting Date road ofoir.
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AGENDA REPORT Item Numhe teem Numbe
Am Num g
Orange County Sanitation District
FROM: James D. Ruth, General Manager
Originator: Lorenzo Tyner, Director of Finance and Administrative Services
SUBJECT: DEFERRED PAYMENT AGREEMENT FOR CHARGES AND FEES OWED BY
ONE INDUSTRIAL WASTEWATER DISCHARGE PERMITTEE
GENERAL MANAGER'S RECOMMENDATION
Approve the Deferred Payment Agreement negotiated by the General Manager for the collection
of all charges and fees owed for sanitary sewer service charges and industrial discharge permit
fees, plus interest of 6.5% per annum,with American Apparel Knit& Dye, in a form approved by
General Counsel.
SUMMARY
American Apparel Knit& Dye is the holder of an industrial wastewater discharge permit issued
by the Sanitation District that requires the payment of sanitary sewer service charges and
industrial discharge permit fees for the cost of conveying, treating, and disposing of wastewater
discharged. Based on the terms of the permit, the permittee is required to pay estimated
quarterly sewer service charges that are reconciled annually with actual discharge flows and
levels of biochemical oxygen demand and total suspended solids. The permittee is now in
default of their payment obligations($134,120.24)and the General Manager, in accordance with
Resolution No. OCSD 98-23,Article III, "Collection of Fees and Charges Relating to Industrial
Waste Dischargers," has negotiated a two-month deferred payment agreement with this
permiftee requiring monthly payment terms plus interest of 6.5% per annum.
PRIOR COMMITTEWBOARD ACTIONS
N/A
ADDITIONAL INFORMATION
Admin.
Installment Principal Interest Charges Total Due Date Due
1 $66,879.26 $726.48 $25.00 $67,630.74 12/14/08
2 $67,240.98 $364.22 $25.00 $67,630.20 01/14/09
JDR:LT:MW:AB
F000 No,Dmcz3 Rovim .OWIM7
Page 1
Book Page 10
ADMINISTRATION COMMITTEE MeetNg Date TO ad of DI
12/1010a
AGENDA REPORT agR wvrtme aan Num xv
ADMOa 39
Orange County Sanitation Dishict
FROM: James D. Ruth, General Manager
Originator: Lorenzo Tyner, Director of Finance & Administrative Services
SUBJECT: DEFERRED COMPENSATION PROGRAM
GENERAL MANAGER'S RECOMMENDATION
Informational only.
SUMMARY
During the past decade, numerous legislative and regulatory changes have significantly
changed the way public sector employers must administer deferred compensation plans
with regard to fiduciary responsibility as Plan Administrators. As a result, OCSD
conducted an evaluation of the deferred compensation plan and identified several areas
for improvement through the request for proposal process. Staff recommends moving
to a single-provider platform with services provided by ING Financial Services. A
summary of plan enhancements is included in the table below:
ING Financial Services Incumbent Providers
Average Fund
Performance(Morningstar 4.8 stars 2.8 stars
Rating)
Overall Fund Expenses 0.96% 1.43%
Averse $220,000 annual savings)
Contingent Deferred Sales Eliminated $500,000(approximate)
Charges
Fixed Aeceunt CrediBng 4.25%initial return 3.7%annually
Lincoln:87%of fixed account assets
On-Site Customer Service 1 Three days per week One day per month r rovider
Managed Account 40 BPS(basis points) Not Included
Services
Contingent upon approval by the Board of Directors, the assets currently held with the
three providers (AIG Retirement Company, Lincoln Financial Group, ICMA-RC) will be
moved to ING Financial Services. Transition to the new provider will be mandatory;
however, participants will not be subject to payment of any contingent deferred sales
charges (penalties) and asset allocations will remain intact. A Self-Directed Brokerage
option will be available for participants who prefer to invest in specific funds (such as
their existing fund choices) outside the new core choices.
Fenn No.C 102A ReuIx Mo11Uy
Page 1
Book Page I I
PRIOR COMMITTEEIBOARD ACTIONS
11/16/05: Resolution No. 05-27 -Amend the Deferred Compensation Plan to
include a mandatory cash-out provision for Officers and Employees of OCSD.
• 5/28/03: Resolution No. 03-10 -Amend the Deferred Compensation plan to include a
loan provision.
3/25/98: Resolution No. 98-21 -Amend the Deferred Compensation Plan to include
changes in accordance with the Small Business Protection Act of 1996 and the
addition of two new providers (Vatic and ICMA- International City/County
Management Association).
7/26/95: Resolution No. 95-80 -Amend deferred compensation plan to permit
greater flexibility in plan distribution elections and to clarify certain provisions of the
plan.
04113/94: Resolution No. 94-39 -Approve and adopt a revised Deferred
Compensation Plan.
09/91: Adopt Group Fixed Annuity Contract with Lincoln National Life Insurance
Company.
ADDITIONAL INFORMATION
The legislative and regulatory changes that have changed public sector administration
of deferred compensation plans include the Small Business Job Protection Act, the
Economic Growth and Tax Relief Reconciliation Act, and the Pension Protection Act.
As a result, employers are required to exercise fiduciary "due diligence" to assure that
fund options and provider services are competitive and provide optimal.investment
return to participants. In compliance with these new requirements, OCSD conducted a
comprehensive review of its providers, its processes for selecting providers, and its
review of specific funds, costs, and services to assure that we adhere to all legislative
and regulatory mandates.
Evaluation of the OCSD deferred compensation plan has shown that investments have
grown to over$40M since inception. The increased plan size provides the Sanitation
District with a better platform from which to negotiate terms of our deferred
compensation contract(s). As a result, there will be some improvements to the deferred
compensation program in 2009. The changes are going to provide substantial benefits
to the participants through higher quality investment choices, reduced costs, and
improved service and educational offerings.
A competitive process was used to evaluate the Plans offered by various companies. A
selection committee representing OCSD employees and retirees evaluated those
submittals based on the following: historical return on investments and performance;
Fcn No.Dmon am.w-a Iw
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fees charges/disclosures; educational services; and recordkeeping services. The
current three providers (AIG Retirement Company, Lincoln Financial Group, ICMA-RC)
submitted proposals; however, the Committee unanimously determined that other
companies offered Plans that were more beneficial to the participants. Three well-
established companies, The Hartford, ING Financial Services, and Prudential Life,
submitted superior proposals and were selected as finalists. The finalists were
subsequently interviewed by the Committee.
The evaluation and interview process illustrated that retaining multiple providers would
perpetuate higher administrative fees, increase mutual fund costs, and reduce the
proposed credited interest rates that were offered under the sole provider option. A
single-provider platform will reduce the Plan's costs and increase the expected net
return on participant investments.
The Committee recommended, and the EMT approved, moving to a single-provider
platform with deferred compensation services provided by ING Financial Services
(ING). These decisions were based on the initial primary criteria including: historical
return on investments and performance; fees charges/disclosures; educational services;
and recordkeeping services as well as secondary criteria including information and
support services; transition support; legal/contract requirements; and standards and
performance guarantees. ING also made numerous enhancements as a result of the
finalist interviews.
ING will offer a variety of core investment choices that are different from the funds
offered now, but in the same investment classes. Historically, these have been better-
performing funds with lower costs, which would be expected to provide higher total
returns than we currently receive. In addition, a Self-Directed Brokerage option will be
available for anyone who prefers to invest in specific funds (such as their existing fund
choices) outside the new core choices.
Specific plan changes offered in ING's proposal included the following:
1. ING ranked first overall in the financial proposal they submitted. Incorporated into
this financial ranking was fund performance, fees, and the breadth of funds that
would allow the District to map its current funds to ING's proposed funds. As a
result of the proposal, average fund performance as measured by Morningstar
increased from 2.8 average stars to 4.8 average stars. Overall fund expenses
decreased from an average of 1.43% to 0.96%. Based upon the total combined
mutual fund holding of all of the existing providers as of December 31, 2007, of
approximately $28 million, that represents a savings of over$220,000 per year in
fund expenses for the plan participants. Based on the current 450 participants, that
represents an average expense savings of nearly$485 per participant per year.
2. Current incumbent providers charge a Contingent Deferred Sales Charge (CDSC)
which represents fees paid when individuals move money from certain accounts.
These fees totaled over$500,000. ING agreed to pay these charges and to
eliminate any future CDSCs from the District's plan.
Form No.DW 02 a awl. 0W1W
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3. The current fixed accounts offered by the three incumbents will be replaced by a
Stable Value Fund offering an initial 4.25% net return. Lincoln Financial Group
(LFG) managed nearly 87% of the fixed account assets as of December 31, 2007,
crediting 3.7% annually. The 0.55% difference in crediting rate generates an
additional $71,500 (or an additional $160 per year per participant)for participants in
the fixed account.
4. Initially, ING offered several Vanguard funds with a fee of 0.30%. These fees were
eliminated in the finalist interviews.
5. ING agreed to eliminate all administrative fees.
6. ING will provide investment advice services through Morningstar.
7. ING proposed a customized web site for the Sanitation District which will be
implemented before the transition date. The site will provide: a) updates on the
transition; b) transition educational activities and schedules; and c) special reports
designed to help District employees and retirees "weather the storm" in the current
financial environment.
B. ING proposed strong enhancements to educational programs for both decision-
makers and plan participants. ING representatives will be on site an average of three
days per week assuring that both District facilities and all shifts are targeted to be
available to plan participants at their convenience. In addition to individual on site
representatives, a series of educational programs will be offered on a regular basis.
The educational content and schedule will be published on the customized web-site.
9. ING agreed to assume administrative responsibility for all special activities including
loans, unforeseen emergency withdrawal applications, catch-up provisions, and
domestic relations orders.
Contingent upon approval by the Board of Directors, transition to ING is expected to be
complete by March 1, 2009.
JDR:LT:JR:KE
Fa.No.0W 1023 PsreN:OM W7
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ADMINISTRATION COMMITTEE Meetlng Date To Bd.of Dir.
12/10/08
AGENDA REPORT Rem Number Item Number
ADM0840
Orange County Sanitation District
FROM: James D. Ruth, General Manager
Originator: Lorenzo Tyner, Director of Finance and Administrative Services
SUBJECT: OCSD's EMPLOYEE RECOGNITION PROGRAM
GENERAL MANAGER'S RECOMMENDATION
Informational only.
SUMMARY
HR staff is currently developing the "Spotlight on Excellence" employee recognition
program. The purpose of the program is to help foster a culture of appreciation and
recognition throughout the organization, which supports OCSD's mission, vision, core
values, and strategic goals. Furthermore, it helps validate and praise outstanding work,
keep employees motivated, and ensures organizational efficiency by attracting and
retaining high performers. Managers can use this tool to help employees understand
how their jobs contribute to the agency's overall goals, and how their performance
affects the achievement of those goals.
PRIOR COMMITTEE/BOARD ACTIONS
N/A
ADDITIONAL INFORMATION
OCSD currently operates several concurrent employee recognition programs, such as
the IDEA, VIP, and service awards. The Spotlight on Excellence program seeks to
combine all the individual programs, and tying the rewards and funding into one
comprehensive program. For example, employees can accrue points for VIP, IDEA,
and Safety Incentives to be consolidated into a bank.
Form No.nw-rae.e R-1.avmrm
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1
Program design will include "SMART" recognition and rewards (Supports Organizational
Goals & Values, Meaningful, Adaptable, Relevant, and Timely).
During the developmental phase, the criteria that will warrant recognition will be
established and reward thresholds will be clearly defined. Some of these may include
meeting agency/departmental/divisional goals, productivity, team-building, cost
reduction, attendance, safety and other miscellaneous measures.
Management may choose to provide monetary, non-monetary, leave rewards, or any
combination of the three to employees. Some awards do, however, have tax
implications that will need to be considered.
It is important to include management in the design and development of this program to
define the performance and behaviors that are to be rewarded, and to ascertain the
level of commitment necessary to plan and execute the program. In addition, managers
and supervisors will be accountable for managing the recognition program for their
respective department. This wide distribution of authority should help ensure timely
recognition, which is extremely important to the success of the program.
The General Manager shall determine availability of funds, and funding levels as
deemed appropriate to support the recognition program.
A focus group comprised of staff at all levels of the agency will be formed to ensure the
program meets the needs of our diverse workforce. The focus group will be responsible
for determining the program's objectives; defining eligibility, determining limitations and
exclusions; establishing the program's evaluation criteria as it may differ by division,
department, or job classification; and identifying the decision-makers and program
administrators.
ATTACHMENTS
1. Employee Recognition Program Manual
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INTRODUCTION
WHAT IS AN EMPLOYEE RECOGNITION PROGRAM?
An employee recognition program could be an effective method of reinforcing company
expectations and goals. Its main purpose is to validate and praise outstanding work,
keep employees motivated, and ensure organizational efficiency by attracting and
retaining high performers.
The Human Resources (HR) Division, in conjunction with the Executive Management
Team (EMT), promotes programs that recognize employees' contributions to overall
objectives and efficient operation of the Orange County Sanitation District.
Departments shall develop and implement recognition programs. The Executive
Management Team will support programs within the agency to recognize the
contributions of their employees.
This handbook serves as a guide to District management in developing individual
department Employee Recognition Programs.
The handbook provides: information on the importance of recognition and rewards;
program development that links to the organization's mission and values; steps to assist
departments in developing a successful program; ideas to consider within the budget.
This handbook also provides an opportunity to:
• Stimulate new thinking
• Assess each department's current rewards/recognition program
• Learn innovative approaches
• Think differently about current circumstances
• Better define and focus on areas that need to be changed
• Plan implementation approaches
• Select indicators and/or measures for success
• Plan internal customer feedback surveys
• Set improvement goals through assessment and reassessment
The role of the Human Resources Division is to:
• Provide policy review and interpretation
• Initiate training for supervisors/managers in the delivery of recognition programs
• Work with departments on strategies and contracts for recognition items
• Serve as a resource and advocate to agencies on employee recognition programs
• Communicate and promote recognition programs to the agency
The General Manager shall ensure availability of funds to support costs incurred by
employee recognition programs that acknowledge employees' contributions to the
effective operation of a division or department. Departments should, with the support of
HR, develop procedures for employee recognition awards to foster positive employee
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relations, develop programs that raise morale for all employees in the department, and
improve District operations.
The EMT is encouraged to:
• Develop a plan for employee recognition programs that links with the District's
mission, goals and values, and Strategic Plan.
• Allocate resources to implement the programs and provide internal training for the
programs
• Promote and serve as an advocate for District employee recognition programs
RECOGNITION/REWARD
Employees not only want good pay and benefits, they also want to be valued and
appreciated for their work, treated fairly, do work that is important, have advancement
opportunities, and opportunities to be involved in the agency. Recognition and rewards
play an important role in department and District programs to attract and retain
employees. It is the day-to-day interactions that make employees feel that their
contributions are appreciated and that they are recognized for their own unique
qualities.
Various types of recognition may contribute to high morale in the work environment. So,
it's extremely important that managers, who communicate the agency goals to
employees, are included in the development of recognition programs.
WHAT'S MOST IMPORTANT IN A RECOGNITION PROGRAM?
TO MANAGERS OF THE
MANAGEMENT: TOEMPLOYEES. -�[ PROGRAM:
• Increases productivity • Satisfies recognition • Includes efficient
needs administration
• Improves attitudes
• Creates positive • Excites employees
• Builds loyalty and recognition experience
commitment • Creates pride
• Provides a wide selection
• Generates positive of attractive, personalized • Pleases management
feedback awards
• Involves all employees
• Empowers the workforce • Provides timeliness of
recognition . Develops a partnership
• Assures efficiency with the workforce
• Guarantees quality of
award
• Fosters open
communication of
appreciation
Source: O.C. Tanner, 2000
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An organization that can differentiate between, and effectively fulfill, all three levels of
concerns (management, employees, and managers of the program) may achieve levels
of performance they may never have thought possible. In addition, an effective
recognition program should meet several essential criteria:
(a)A recognition program cannot exclude any employee
(b) An employee knows exactly what should be accomplished in order to earn
recognition and rewards
(c)A manager's success is tied to the employees' success
Recognition is a leadership tool that sends a message to employees about what is
important to the leaders and the behaviors that are valued. Managers can use this tool
to help employees understand how their jobs contribute to the agency's overall goals
and how their performance affects the achievement of those goals. Often people have
come to accept the notion that an employee is paid to do their job. So why should they
be praised for doing what they're paid to do? Praise of an employee reinforces,
recognizes and motivates behaviors that you, as management wants to see.
Recognition can be delivered in a number of ways. A simple "Thank You" is
inexpensive, takes only a few minutes, and can positively impact productivity and
morale. Additionally, a recognition program should be SMART:
Supports Organizational Goals and Values: The program should motivate employees in
alignment with OCSD's mission, vision, core values, and strategic goals.
Meaningful: The reward should fit the performance and/or behavior being rewarded, and
should be meaningful to the individual receiving it.
Adaptable: A diverse workforce warrants alternatives. One size does not fit all.
Recognition and rewards should meet the varying needs of the receiver.
Relevant: To ensure that employees tie recognition to the division, department and/or
District goals, employees must be told what they did right, and how it supports
organizational goals.
Timely: Recognition should occur as close as possible to the time the behavior
occurred.
To ensure that employees tie recognition into the department or agency's strategic
goals, employees should know what they did right and how it interacts with the goals.
Include supervisors and employees in the development of your recognition program to
represent the values and goals of a diverse cross-section of the division, department, or
agency. Provide the opportunity for recognition to come from a variety of sources.
Peer-to-peer recognition usually is highly valued by employees. It can be used to
develop a supportive work environment.
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For many employees, recognition received through the expression of genuine
appreciation for the work they do is a reward. Being involved in a project or receiving
special training may be another's reward. Make no mistake, however, that most
employees would not turn down a monetary, non-monetary or recognition leave reward!
In developing a program incorporating gifts, prizes, and leave, remember that some
employees are recipients and some are non-recipients. Pay careful attention to your
goals and determine if a particular program works well in your division, department or
the agency as a whole. It is possible to cause more harm through competitive contests
than to provide some form of recognition that rewards a greater number of your
employees. Also, consider whether the recognition and reward program focuses
employees more on the gift or prize than on the underlying goals of the program.
PROGRAM DEVELOPMENT
Before you begin building a new recognition program, determine why your current
recognition methods are not sufficient. It may be a lot simpler to change parts of your
current program rather than create an entirely new program, especially if the current
program is providing some positive results. You should understand and be able to
communicate to employees how the recognition program ties into the agency's vision so
employees know what behaviors and goals that the agency values.
Be certain to include your supervisors and employees or form a focus group to make
recommendations for changes in the existing program or to assist in the design of the
new program. These individuals can tell you how and why recognition is important to
them. Ask them what they value in recognition and rewards and listen to their
responses. Take particular notice of the cash, non-cash, and leave rewards that
employees value and do not value. For example, an employee with low leave balances
may value recognition leave more than the monetary or non-monetary reward.
Key Points to Remember - Elements of Successful Program
A. Link behaviors that are to be recognized and rewarded to the organizational
mission. In order for a rewards and recognition program to survive and be cost
effective, it should contribute to the accomplishment of the organizational mission.
Organizations spend time and money to implement a rewards and recognition program
so that it will make a difference in how well the organization performs against its
mission—its very reason for existence. Otherwise, if the behaviors rewarded are not
linked to the organizational mission, behaviors that are not valuable to the organization
could be reinforced, and lead to ineffective programs.
In addition, a successful program that emphasizes the organizational mission should
produce a positive effect on the work unit or agency. So, when managers see a direct
contribution to the "bottom-line", it is more likely to sustain their interest in the effective
use of rewards and recognition throughout the organization.
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Involve as many employees as possible in the design and development of the program.
Although all parts of the program are important, the design and development of the
program is probably the most important. Certainly, in the beginning it may take some
time to design and develop a recognition and rewards program that meets the work unit,
agency and employee needs.
In attempting to design and develop an effective program, it is helpful to remember that
the wants, desires, needs and values of the entire employee population are not
identical. Steer clear of developing and designing a program that assumes that every
employee wants the same rewards for a job well done, even though there are significant
differences in their jobs, work locations, and work environment.
Several elements constitute a good program.
• Design the program so employees receive recognition and rewards as soon as
possible;
• Use a variety of rewards: a mix of monetary, non-monetary, and recognition leave;
• Provide many opportunities for reinforcement; and
• Find items that are motivating to a wide range of employees in the organization or
provide employees with various choices
B. Train all levels of management. Some managers are a natural when it comes to
the elements of recognition and rewards. Others need to acquire skills related to
recognizing employee's contributions and giving effective feedback and positive
reinforcement. Thus, all managers and supervisors should be trained on:
• Stressing the importance of the program and how it can impact the bottom line
• Providing employees with an understanding of how they can impact the organization's
goals and drive the business to success
• Discussing the approach for managing and rewarding both individual and team
performance
• Explaining how the program works and how employees can receive recognition
• Learning ways to motivate and inspire others
• Learning how to communicate needs, expectations, and goals clearly
Ideally, training should begin as high in the hierarchy as possible and produce results
that prompt involvement by executive management. The lack of participation by upper
management may not prevent others from achieving significant results, but it may take
longer to obtain results and they may be harder to maintain.
C. Communicate the program's existence. Deciding how to communicate the
program depends largely upon the culture of the organization and the various types of
media readily available--training, staff meetings, policy and procedures, intranet, email,
newsletter, flyers. It is also important, on an ongoing basis, for managers and
supervisors to reconsider the options available to them to recognize various types of
employee achievement. Additionally, the Public Information Office (PIO) can assist
departments in developing a communications strategy and plan.
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Department leadership should meet with employees and review the program's progress
and solicit verbal feedback on how the program is working. It is a rare program that
works without some changes in the design or process. Use the meeting to find out if
employees truly understand how the program works and whether or not the rewards
currently being used are indeed of value to the recipients. Also, a review meeting could
serve as an opportunity to discuss means of improvement by identifying supporting
behaviors other than those already included in the program.
D. Evaluate the program's effectiveness. All programs should be evaluated at least
on an annual basis in order to ensure that the program's goals and objectives continue
to be effective, are fresh and align with the work unit or agency objectives. You may
want to consider surveying employees about the programs and requirements to
determine how well the programs are known and received throughout the organization.
Step-by-Step Guidelines
This section provides step-by-step guidelines to assist managers in the development
and assessment of recognition programs that are beneficial and meaningful to
employees.
These steps are elaborated further in this section and may be followed out of order.
The steps were obtained from www.incentivemag.com, which provides a wealth of
information.
Below is a list of the steps.
• Step One —Target Your Audience
• Step Two— Choose the Goal
• Step Three— Build a Budget
• Step Four— Develop Criteria
• Step Five— Choose the.Awards
• Step Six— Communicate the Program
• Step Seven — Present the Award(s)
• Step Eight— Evaluate the Program
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STEP ONE. TARGET YOUR AUDIENCE
Target your audience) Sometimes when managers and supervisors think about
recognition, they may automatically assume that one plan fits all. Although each
department has strategic goals to accomplish, each division within the department has
distinct groups of employees who generally require different motivational strategies.
First, you need to determine which part of your department or division that needs to be
motivated by achieving goals within the work environment. Each division and
department should have a specific audience to target. Also, as the manager, ask
yourself:
•What type(s) of work and jobs are in your audience?
• How many employees?
•Who are they?
•What motivates each person individually?
• Do we provide team, individual or both types of recognition?
• How are recognition programs communicated?
•What are our employees recognized for?
• How do our employees receive recognition?
Consider what should be accomplished. Only then can you design an efficient and
effective program. Ask yourself, "What are my objectives and how do they fit within this
division or department and with these employees?'
STEP TWO: CHOOSE THE GOAL
In looking at the specific audience, also target a specific group of behaviors you
want to improve. Is your goal to improve employee morale, reduce turnover, increase
productivity, or all of the above? Focus on targeting behavior that promotes efficient and
effective public service. It also should be measurable, such as an increase in
productivity or decrease in costs. Make a list of your expectations and hopes for
employee recognition efforts.
Focus on the particular challenges and objectives within your division or
department. What are the most pressing needs? Focus on the exact requirements of
the top one or two. With this information, you should be in a better position to develop
the program and set the goals. Find out why the goals have not been met in the past,
and then determine whether the goals are truly what are needed. Also, consider the
nature of the problem and if a recognition program is what you need.
Are your current recognition methods sufficient? Determine if you need to redesign
your existing program or design a new one. Include supervisors and employees, or use
a focus group, in your determination. Identify the types of rewards (monetary, non-
monetary and recognition leave)that your employees value.
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Be specific in your objectives and state them plainly so that employees
understand the 'line of sight'. Focus on one or two goals. More than that may make
the program cumbersome, difficult to understand, and from the employee's standpoint
unachievable.
Can the goals be accomplished? What happens if a large number of the participants
cannot attain the goals? Are there any other factors, which could hinder the desired
outcomes?
Is the proposed program directly related to division, department, or agency goal?
Are the goals difficult or expensive to measure? How do these goals interact with the
agency's vision? Will the program be in conflict or affected by any agency policies?
Below are a variety of recognition and reward programs that you may want to consider
for your division or department:
• Safety achievement
• Honoring separating employees/long-term employment
• Exemplary attendance
• Productivity
• Creativity in new and innovative methods and procedures through the IDEA Program
• Excellent customer service
• Superior performance
• Employees of the month, quarter, or year
• Positive attitudes
• High levels of skill
• Team players
• Initiative to get the job done
• Volunteering to represent the agency/work unit through the Volunteer Incentive
Program
Once you have completed this step, carefully craft a statement regarding the purpose of
the program that can be clearly understood by employees. Determine a suitable name
for the program that is compatible with the division, department, and/or agency culture.
STEP THREE: BUILD A BUDGET
When developing your budget consider the following items in your estimate:
•The costs of the promotional materials
• The potential number of recipients
•The costs of the awards
• The presentation type (formal/informal: location)
• The number of people expected to attend the award presentation
• The costs of food, facilities, decorations, equipment, etc.
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•The costs for the presentation ceremony
•The costs related to administration
• The costs of training managers and supervisors
STEP FOUR: DEVELOP CRITERIA
These are the criteria, usually written, that participants need to meet to succeed
In the program. Be sure to include specific and straightforward goals that have some
stretch, because it is unlikely that all employees will achieve the goals. The agency has
the option to set program limits on the number of award recipients and may want to
consider different levels and types of awards. Consider surprises, such as two people
tying for the reward.
Be specific about the timeframe for which the goal must be completed. However, if
you ask your target audience to reach too many benchmarks, the program may"turn
off" employees. Also, you may want to create an atmosphere that excites employees so
they are having some fun as a participant in the program. Focus on one or two goals.
Consider how you will measure progress on an ongoing basis.
Create a measurement system that is understood by employees, viewed as fair,
and quantifiable. You may consider using a focus group and ask for feedback on how
specific jobs are measured. You could use measurements such as the number of
customers served, safety, or positive customer service comments. Consider how often
progress is reported (daily, weekly, monthly, quarterly). Send reports on a regular basis
to keep interest levels high.
STEP FIVE: CHOOSE THE AWARDS
Based on completion of the budget step, you may determine whether multiple choices
are available to the recipient. Look at a variety of options within a certain price
range that provide a good opportunity to meet the individual's interests. Even a
budget with few dollars can still afford a personal thank you for a job well done. (See
Section on Ideas to Help Meet Your Budget).
Choosing awards is one of the most important steps in the success of your
program. If the reward chosen does not motivate or inspire employees to achieve the
stated goal, the program may have less participation and not achieve the level of
success expected. By taking into consideration input from the supervisors, employees,
and/or the targeted audience, you should be able to determine the rewards that do or do
not have meaning. Variety is important because recipients have varying tastes and
interests.
There are a wide range of awards that include monetary awards, non-monetary awards,
and recognition leave.
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Non-monetary items may be purchased through the Contract, Purchasing, and
Materials Management Division.
STEP SIX. COMMUNICATE THE PROGRAM
Program communication is essential from the start up and should be ongoing.
Rationale and results of the new program should be clearly communicated. There
should be a clear link between what the target audience is rewarded for and the division
or department's priorities. Ensure that everyone understands the relationship between
his or her improvements and rewards. Ask employees to compare old and new
programs. Follow up with employees so they know they're being listened to. Make sure
your front line supervisors understand the program and support it.
By involving employees and supervisors in the development of the program, you
already are well on your wayl Use input from your target audience to develop a catchy
theme for your recognition program and use it on your awards, promotional items, etc.
Make sure the message is relevant and in accordance with your division/department
image.
Have a kick-off meeting to provide full details about the program, criteria, awards,
and target audience. Plan on having kickoff materials available to build momentum
and excitement about the program. Tie the reward into the kickoff meeting. For
example, if one of the rewards is a plaque or certificate, have one available. If your
employees are scattered throughout shifts, be certain to send materials to them develop
a kick-off meeting during their shift. A video of the original kick-off meeting distributed to
the various locations may also be useful.
Use promotional materials often to remind and reenergize employees
participating in the program. Flyers, posters, brochures, bulletins, and MyOCSD are
some other considerations.
During the program, provide status updates via mail, E-mail or MyOCSD to the
employees. Be certain to keep senior management up-to-date with reports of the
program's success or need for fine-tuning.
STEP SEVEN: PRESENT THE AWARDS)
Generally if something is worth recognizing, it's worth publicizing. Make sure your
presentation matches the significance of the recognition. You may choose to use
formal or informal means of recognition. However, as a manager, you need to consider
the additional financial impact of a formal presentation.
Take the opportunity to let employees know what their individual achievements or
team accomplishments are and the type of rewards available. This can be
accomplished by verbal, written, e-mail or MyOCSD communication:
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• One-on-one with the employee
• In the immediate group or division
• In a department or agency-wide meeting
You can present during potluck lunches (zero cost to agency), low cost (doughnuts,
cake, ice cream), moderate cost events (box lunches), and during higher cost events
(Employee Appreciation Luncheon). Remember to factor in the range of costs from tips,
deliveries, tents, paper supplies, decorations and utensils for rewards and
entertainment.
It is important to consider whether the recipient prefers to participate in a public
presentation or in a less formal setting. Why wouldn't they want to attend the
presentation if it's all about recognition? If they are shy or introverted, they may feel
uncomfortable with the attention. By having your program fully developed and clearly
communicated, it can be easily conveyed that the presentation is part of the program
criteria. Consider carefully the potential impact this may have on those exemplary
employees who do not "like a fuss."
Above all, make your presentation to the employee worthy of the reason that you are
recognizing the employee!
STEP EIGHT: EVALUATE THE PROGRAM
It's Important to measure the success of your recognition program by
considering both tangible and intangible results. Ask for feedback from upper
management, and your supervisors and employees (participants and non-participants).
Distributing an employee assessment survey prior to and during the program initiative
also may be worthwhile. Also, reviewing turnover rates and attendance/tardy records
should provide some indication of success of your program as well.
Consider conducting a survey of your customers that may indicate the success of your
program. Formal surveys or informal customer feedback can provide the basis for your
evaluation.
Consider developing a survey or informal set of questions using the information
listed below. After you have completed your evaluation, you can then begin the
process of fine-tuning.
Employee Reaction
• Did employees clearly understand the program and its objectives?
•Was the division/department excited about the program?
• Did employees like the rewards or activities provided?
• What did employee participants and non-participants like/dislike about the program?
• How well is the program understood?
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• Did the program clearly explain how and why you should recognize others?
• Were the guidelines clear and communicated well?
•Was the nomination and award process understood?
•What were the results, broken down by division, department, and agency-wide?
•What was everyone's favorite part of the program?
How has behavior changed?
•Are recognition tools being used more often?
• How frequently do you, as a manager, and your supervisors recognize their
employees?
• Did we meet our less tangible goals— improving morale, fostering loyalty, and
inspiring suggestions?
• Is an appropriate level of recognition given for the behavior?
• How often and to what extent is recognition a part of the division, department, or
agency's communication vehicles?
Overall
• Did the program meet your expectations?
• How is the new or modified program better than the previous program or activity?
•Are there areas for improvement?
•What would the results have been without the incentive program?
• What did you like/dislike about the program?
•Would you recommend continuing the program next year?
• What percentage of employees participated, and what percentage were
nonparticipants?
• How did the participants' performance measure against the nonparticipants?
• How many and which participants did or did not succeed and why?
•Were your budget calculations adequate?
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Book Page 29
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