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HomeMy WebLinkAbout03-14-2018 Administration Committee Meeting Agenda03/14/2018 Administration Committee Agenda Page 1 of 2 Orange County Sanitation District Regular Meeting of the ADMINISTRATION COMMITTEE Wednesday, March 14, 2018 5:00 P.M. Administration Building Board Room 10844 Ellis Avenue Fountain Valley, CA (714) 593-7433 AGENDA CALL TO ORDER: PLEDGE OF ALLEGIANCE: DECLARATION OF QUORUM: (Clerk of the Board) PUBLIC COMMENTS: If you wish to address the Committee on any item, please complete a Speaker’s Form (located at the table outside of the Board Room) and submit it to the Clerk of the Board or notify the Clerk of the Board the item number on which you want to speak. Speakers will be recognized by the Chairman and are requested to limit comments to three minutes. REPORTS: The Committee Chair and the General Manager may present verbal reports on miscellaneous matters of general interest to the Committee Members. These reports are for information only and require no action by the Committee. CONSENT CALENDAR: The Consent Calendar Items are considered to be routine and will be enacted, by the Committee, after one motion, without discussion. Any items withdrawn from the Consent Calendar for separate discussion will be considered in the regular order of business. 1. APPROVAL OF MINUTES (Clerk of the Board) RECOMMENDATION: Approve Minutes of the February 14, 2018 Administration Committee Meeting. INFORMATION ITEMS: 2. SUPERVISORY CONTROL AND DATA ACQUISITION (SCADA) SYSTEM AT PLANT NO. 1, PLANT NO. 2, AND PUMP STATION (Rob Thompson) 3. BUSINESS CONTINUITY PROGRAM UPDATE (Celia Chandler) 4. FY 2018-19 AND FY 2019-20 ORANGE COUNTY SANITATION DISTRICT BUDGET UPDATE (Lorenzo Tyner) 03/14/2018 Administration Committee Agenda Page 2 of 2 DEPARTMENT HEAD REPORTS: CLOSED SESSION: None. OTHER BUSINESS AND COMMUNICATIONS OR SUPPLEMENTAL AGENDA ITEMS, IF ANY: ADJOURNMENT: The next Administration Committee meeting is scheduled for Wednesday, April 11, 2018 at 5:00 p.m. Accommodations for the Disabled: Meeting Rooms are 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) 593-7433 at least 72 hours prior to the scheduled meeting. Requests must specify the nature of the disability and the type of accommodation requested. Agenda Posting: In accordance with the requirements of California Government Code Section 54954.2, this agenda has been posted outside the main gate of the Sanitation District’s Administration Building located at 10844 Ellis Avenue, Fountain Valley, California, not less than 72 hours prior 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 the Board of Directors, are available for public inspection in the office of the Clerk of the Board. Agenda Description: The agenda provides a brief general description of each item of business to be considered or discussed. The recommended action does not indicate what action will be taken. The Board of Directors may take any action which is deemed appropriate. NOTICE TO DIRECTORS: To place items on the agenda for the Committee Meeting, items must be submitted to the Clerk of the Board 14 days before the meeting. Kelly A. Lore Clerk of the Board (714) 593-7433 klore@ocsd.com For any questions on the agenda, Committee members may contact staff at: General Manager James Herberg (714) 593-7300 jherberg@ocsd.com Assistant General Manager Bob Ghirelli (714) 593-7400 rghirelli@ocsd.com Assistant General Manager Rob Thompson (714) 593-7310 rthompson@ocsd.com Director of Finance and Administrative Services Lorenzo Tyner (714) 593-7550 ltyner@ocsd.com Director of Human Resources Celia Chandler (714) 593-7202 cchandler@ocsd.com 02/14/2018 Administration Committee Minutes Page 1 of 6 MINUTES OF THE ADMINISTRATION COMMITTEE Orange County Sanitation District Wednesday, February 14, 2018 at 5:00 P.M. A regular meeting of the Administration Committee of the Orange County Sanitation District was called to order by Committee Chairman Wanke on February 14, 2018 at 5:04 p.m. in the Administration Building of the Orange County Sanitation District. Director Mike Posey led the Flag Salute. A quorum was declared present as follows: COMMITTEE MEMBERS PRESENT: Chad Wanke, Chairman Jim Ferryman Peter Kim Al Krippner (Alternate) Steve Nagel Glenn Parker Scott Peotter Mike Posey Teresa Smith Greg Sebourn, Board Chairman David Shawver, Board Vice-Chairman COMMITTEE MEMBERS ABSENT: Donald P. Wagner, Vice-Chairman Sal Tinajero STAFF PRESENT: Jim Herberg, General Manager Bob Ghirelli, Assistant General Manager Rob Thompson, Director of Engineering Celia Chandler, Director of Human Resources Jim Colston, Director of Environmental Services Ed Torres, Director of Operations & Maintenance Lorenzo Tyner, Director of Finance & Administrative Services Kelly Lore, Clerk of the Board Jennifer Cabral Rhea De Guzman Al Garcia Ddaze Phuong Tyler Ramirez Mike White OTHERS PRESENT: Brad Hogin, General Counsel Bill Dennehy, Chandler Asset Management PUBLIC COMMENTS: None. REPORTS: General Manager Jim Herberg reported on the following: OCSD Administrative Offices will be closed on Monday, February 19 in observance of President’s Day; and provided information regarding the GWRS 10th Anniversary Winterfest event this Friday, ITEM NO. 1 02/14/2018 Administration Committee Minutes Page 2 of 6 February 16 and the State Assembly and Senate Floor Recognition for the GWRS 10th Anniversary on February 26. Committee Chair Wanke did not provide a report. CONSENT CALENDAR: 1. APPROVAL OF MINUTES (Clerk of the Board) MOVED, SECONDED, AND DULY CARRIED TO: Approve Minutes of the December 13, 2017 Administration Committee Meeting. AYES: Ferryman, Kim, Krippner (Altnerate), Nagel, Parker, Peotter, Posey, Sebourn, Shawver, T. Smith and Wanke NOES: None ABSTENTIONS: None ABSENT: Tinajero and Wagner 2. GM APPROVED PURCHASES AND ADDITIONS TO THE PRE-APPROVED OEM SOLE SOURCE LIST (Lorenzo Tyner) MOVED, SECONDED, AND DULY CARRIED TO: Recommend to the Board of Directors to: A. Receive and file District purchases made under the General Manager’s authority for the period of October 1, 2017 to December 31, 2017; and B. Approve the following additions to the pre-approved OEM Sole Source List for the period of October 1, 2017 to December 31, 2017: • AMOT - Gas valves for CenGen engines • ELECTRABOND - Coating of belt filter press rollers • FONTAINE-AQUANOX - PVC stem covers • INGERSOLL RAND - Air compressor valves and parts • OVIVO - Trickling filter parts • PULSAFEEDER - Ferric injection pumps • QUINCY COMPRESSOR - Air compressor parts and service • SAFT AMERICA - UPS batteries • TIRESHARK - Traffic spikes AYES: Ferryman, Kim, Krippner (Alternate), Nagel, Parker, Peotter, Posey, Sebourn, Shawver, T. Smith and Wanke NOES: None ABSTENTIONS: None ABSENT: Tinajero and Wagner 02/14/2018 Administration Committee Minutes Page 3 of 6 Item No. 3 was pulled and heard separately. 3. MID-YEAR CONSOLIDATED FINANCIAL REPORT FOR THE PERIOD ENDED DECEMBER 31, 2017 (Lorenzo Tyner) At the request of Director Peotter, Director of Finance and Administrative Services Lorenzo Tyner and Controller Mike White presented information regarding the Mid-Year Financial report including: Total revenues, sewer service fee cashflow thru December 31, Orange County property tax collection and apportionments, Capital Improvement Program cashflow budget, debt service forecast, self-insurance, and a basic overview of the investment portfolio. MOVED, SECONDED, AND DULY CARRIED TO: Recommend to the Board of Directors to: Receive and file Orange County Sanitation District Mid-Year Report for the period ended December 31, 2017. AYES: Ferryman, Kim, Krippner (Alternate), Nagel, Parker, Peotter, Posey, Sebourn, Shawver, T. Smith and Wanke NOES: None ABSTENTIONS: None ABSENT: Tinajero and Wagner 4. ADOPT RESOLUTION ESTABLISHING AN ENVIRONMENTALLY PREFERABLE PURCHASING AND PRACTICES POLICY (Lorenzo Tyner) MOVED, SECONDED, AND DULY CARRIED TO: Recommend to the Board of Directors to: Adopt RESOLUTION NO. OCSD 18-XX entitled “Environmentally Preferable and Practices Policy.” AYES: Ferryman, Kim, Krippner (Alternate), Nagel, Parker, Peotter, Posey, Sebourn, Shawver, T. Smith and Wanke NOES: None ABSTENTIONS: None ABSENT: Tinajero and Wagner INFORMATION ITEMS: 5. INVESTMENT PERFORMANCE RESULTS (Lorenzo Tyner) Mr. Tyner Introduced Investment Manager Bill Dennehy from Chandler Asset Management who distributed an Investment Report in hard copy and provided an informative presentation which included: Economic Update (Employment, Inflation, Consumer Price Index and the Personal Consumption Expenditures, Gross Domestic Product, and Bond Yields) and OCSD’s account profile and how to insulate it from the rising rate environment (Portfolio Characteristics, Sector allocation, Long term portfolio, issuers and the portfolio compared to the Benchmark, Compliance with investment policy, Liquidity Portfolio, treasury allocation, and the other various securities were presented.) Mr. Dennehy 02/14/2018 Administration Committee Minutes Page 4 of 6 responded to questions regarding vulnerabilities and the conservative method of the diversified portfolio. The Committee requested that in the future, they receive this type of lengthy information prior to the meeting to allow further time to study. NON-CONSENT: 6. CONSIDERATION OF BUDGET ASSUMPTIONS AND BUDGET CALENDAR FOR PREPARATION OF THE FY 2018-19 AND FY 2019-20 BUDGET TWO- YEAR BUDGET (Lorenzo Tyner) Mr. Tyner provided a brief overview of the item and Mr. White provided a PowerPoint presentation regarding the Budget Assumptions including: projected inflation, revenue, proposed SFR rate increase and a comparison to other agencies, operations (daily flow projections and expenses), staffing levels and salary adjustments, cash flow assumptions and baseline CIP cost, debt financing and the percentages of revenues and expenditures in the proposed budget summary, and reviewed the budget development key meeting dates. Mr. White and Mr. Tyner responded to questions regarding: projected surplus vs. reserves, cash flow models, proactive UAL payoff, future capital costs, investments, and cost saving measures. MOVED, SECONDED, AND DULY CARRIED TO: Recommend to the Board of Directors to: Approve the FY 2018-19 and FY 2019-20 budget assumptions and direct staff to incorporate these parameters in the preparation of this two-year budget. AYES: Ferryman, Kim, Krippner (Altnerate), Nagel, Parker, Peotter, Posey, Sebourn, Shawver, T. Smith and Wanke NOES: None ABSTENTIONS: None ABSENT: Tinajero and Wagner Director T. Smith departed the meeting at 6:05 p.m. 7. PROPOSED ORDINANCE ADOPTING REGIONAL SEWER SERVICE CHARGES (Lorenzo Tyner) Mr. Tyner provided a summary of the three proposed Ordinances reflected in Item Nos. 7-9. Mr. Herberg notified the Committee that the Notice of Public Hearing was mailed out on Friday February 9 and we anticipate public input and comment regarding the increases, which will be provided to the Board of Directors. MOVED, SECONDED, AND DULY CARRIED TO: Recommend to the Board of Directors to: A. Motion to read Ordinance No. OCSD-XX by title only and waive reading of said entire ordinance; B. Introduce Ordinance No. OCSD-XX, entitled: “An Ordinance of the Board of 02/14/2018 Administration Committee Minutes Page 5 of 6 Directors of Orange County Sanitation District Adopting Regional Sewer Service Charges and Repealing Ordinance No. OCSD-41 and Ordinance No. OCSD-46”; and C. Set March 28, 2018, as the date of the Public Hearing to hear protests and for the second reading of the Ordinance No. OCSD-XX. AYES: Ferryman, Kim, Krippner (Alternate), Nagel, Parker, Peotter, Posey, Sebourn, Shawver, and Wanke NOES: None ABSTENTIONS: None ABSENT: T. Smith, Tinajero and Wagner 8. PROPOSED ORDINANCE ADOPTING CAPITAL FACILITIES CAPACITY CHARGES AND FEES (Lorenzo Tyner) Late communication was provided by the Clerk of the Board which redlined minor changes to the Ordinance. MOVED, SECONDED, AND DULY CARRIED TO: Recommend to the Board of Directors to: A. Motion to Read Ordinance No. OCSD-XX by title only and waive reading of said entire ordinance; B. Introduce Ordinance No. OCSD-XX, entitled: “An Ordinance of the Board of Directors of the Orange County Sanitation District Adopting Capital Facilities Capacity Charges and Repealing Ordinances No. OCSD-40 and No. OCSD-42”; and C. Set March 28, 2018, as the date of the Public Hearing to hear protests and for the second reading of the Ordinance No. OCSD-XX. AYES: Ferryman, Kim, Krippner (Alternate), Nagel, Parker, Peotter, Posey, Sebourn, Shawver, and Wanke NOES: None ABSTENTIONS: None ABSENT: T. Smith, Tinajero and Wagner 9. PROPOSED ORDINANCE ADOPTING MISCELLANEOUS CHARGES AND FEES RELATING TO INDUSTRIAL DISCHARGES, SOURCE CONTROL PERMITTEES AND WASTEHAULERS (Lorenzo Tyner) MOVED, SECONDED, AND DULY CARRIED TO: Recommend to the Board of Directors to: A. Motion to Read Ordinance No. OCSD-XX by title only and waive reading of said entire ordinance; B. Introduce Ordinance No. OCSD-XX, entitled: “An Ordinance of the Board of Directors of the Orange County Sanitation District Adopting Miscellaneous Charges and Fees Relating to Industrial Dischargers, Source Control 02/14/2018 Administration Committee Minutes Page 6 of 6 Permittees and Wastehaulers and Repealing Ordinance No. OCSD-40 and Ordinance No. OCSD-42; and C. Set March 28, 2018, as the date of the Public Hearing to hear protests and for the second reading of the Ordinance No. OCSD-XX. AYES: Ferryman, Kim, Krippner (Alternate), Nagel, Parker, Peotter, Posey, Sebourn, Shawver, and Wanke NOES: None ABSTENTIONS: None ABSENT: T. Smith, Tinajero and Wagner INFORMATION ITEMS: None. DEPARTMENT HEAD REPORTS: None. CLOSED SESSION: None. OTHER BUSINESS AND COMMUNICATIONS OR SUPPLEMENTAL AGENDA ITEMS, IF ANY: Director Peotter requested that staff hold a Budget Workshop to assist the Board with the budget process. ADJOURNMENT: Committee Chair Wanke declared the meeting adjourned at 6:11 p.m. to the next regularly scheduled meeting of Wednesday, March 14, 2018 at 5:00 p.m. Submitted by: _____________________ Kelly A. Lore, MMC Clerk of the Board Page 1 of 2 ADMINISTRATION COMMITTEE Meeting Date 03/14/18 To Bd. of Dir. -- AGENDA REPORT Item Number 2 Item Number -- Orange County Sanitation District FROM: James D. Herberg, General Manager Originator: Rob Thompson, Assistant General Manager SUBJECT: SUPERVISORY CONTROL AND DATA ACQUISITION (SCADA) SYSTEM AT PLANT NO. 1, PLANT NO. 2, AND PUMP STATION GENERAL MANAGER'S RECOMMENDATION Information Only. BACKGROUND Staff will provide an overview of the current state of the computer and communication systems that help monitor and control the pump stations and treatment works. The instruments, controllers, and Human-Machine-Interfaces (HMI) that comprise the Supervisory Control and Data Acquisition (SCADA) system are very important to the efficient and effective treatment and power generation processes the Orange County Sanitation District (Sanitation District) operates. The process SCADA system provides essential monitoring, control and archiving of data, and is required for regulatory compliance. The existing SCADA system utilizes programmable logic controllers (PLCs) for process monitoring and control and an HMI system, consisting of networks, servers, workstations, software, and a data archiving system referred to as a historian, to allow operational staff to automatically and manually control and configure the plant processes. The existing HMI software has been in service for over 24 years and was initially operated using VAX workstations, which were discontinued in the 1990s. The system requires the use of existing VAX workstations or newer computers running emulation software. The HMI software package, CRISP, is no longer supported by any vendor, and there are few people in the workforce outside the Sanitation District who can support the software. This situation is likely to become increasingly difficult with time. The existing PLC model, Modicon Quantum, has been in service for 20 years, has reached the end of commercial availability, and requires the selection of a new model for future designs. Sufficient spare parts have been purchased by the Sanitation District for system maintenance. Process Control Systems Upgrades Study, Project No. SP-196, which was awarded by the Board of Directors on February 28, 2018, will conduct a study to plan the replacement of the HMI and PLC systems. The HMI system and a select number of PLCs will be replaced as part of the future Process Control Systems Upgrades, Project No. J-120. Page 2 of 2 RELEVANT STANDARDS • 1, 5, 20 year planning horizons • 24/7/365 treatment plant reliability ATTACHMENT The following attachment(s) may be viewed on-line at the OCSD website (www.ocsd.com) with the complete agenda package: N/A Page 1 of 1 ADMINISTRATION COMMITTEE Meeting Date 03/14/18 To Bd. of Dir. -- AGENDA REPORT Item Number 3 Item Number -- Orange County Sanitation District FROM: James D. Herberg, General Manager Originator: Celia Chandler, Director of Human Resources SUBJECT: BUSINESS CONTINUITY PROGRAM UPDATE GENERAL MANAGER'S RECOMMENDATION Information Only. BACKGROUND Risk Management staff will provide an informational presentation on the Orange County Sanitation District’s Business Continuity Plan (BCP) development and implementation. A BCP is a process of developing and documenting arrangements and procedures that enable an organization to respond to an event that lasts for a period of time and ensures that the organization can continue to perform its essential functions or operations during and after the interruption. ATTACHMENT The following attachment(s) may be viewed on-line at the OCSD website (www.ocsd.com) with the complete agenda package: N/A Page 1 of 1 ADMINISTRATION COMMITTEE Meeting Date 03/14/18 To Bd. of Dir. -- AGENDA REPORT Item Number 4 Item Number -- Orange County Sanitation District FROM: James D. Herberg, General Manager Originator: Lorenzo Tyner, Director of Finance & Administrative Services SUBJECT: FY 2018-19 AND FY 2019-20 ORANGE COUNTY SANITATION DISTRICT BUDGET UPDATE GENERAL MANAGER'S RECOMMENDATION Information Only. SUMMARY For continued discussion on the development of the Orange County Sanitation District’s (Sanitation District) Proposed Fiscal Year 2018-19 and Fiscal Year 2019-20 Budget, detail of the Sanitation District’s revenues and reserves is attached. The Proposed Budget will be presented for adoption at the June 27, 2018 Board of Directors meeting. ATTACHMENT The following attachment(s) are included in hard copy and may also be viewed on-line at the OCSD website (www.ocsd.com) with the complete agenda package: • FY 2018-20 Budget Development Revenue Detail • Reserve Summary - FY 2017-18 1 FY 2018-20 Budget Development Revenue Detail Revenue Summary (in millions) Category 2017-18 Adopted 2018-19 Proposed 2019-20 Proposed Revenues: Service Fees 291.1 295.8 300.4 Permit User Fees 12.9 13.1 13.2 Capital Facility Capacity Charge 9.9 12.1 12.5 Property Taxes 93.7 98.3 103.3 Interest 8.4 12.1 16.3 Other Revenue 27.2 37.1 43.8 Debt Proceeds 0.0 0.0 0.0 Total Revenue $443.2 $468.5 $489.5 The Orange County Sanitation District (District) has a variety of revenue sources available for operating and capital expenses. The major revenue sources are as follows: • General Sewer Service Fees • Industrial Waste Permit User Fees • Capital Facilities Capacity Charges (CFCC) • Property Taxes • Interest Earnings • Other Miscellaneous Revenue • Debt Proceeds 2018-19 2019-20 General Service Fees – 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 demand on the system. These fees are for both Single Family Residences (SFR) and Multiple Family Residences (MFR). Beginning with FY 2018-19, staff is proposing a new five-year rate schedule. The SFR rate (the underlying basis for all sewer rates) will increase by 1.2% ($4) to $335 in FY 2018-19, and additional 1.2% annually over the next four years. These rates are still consistently below the average annual sewer rate currently being charged throughout the state. $295.8M $300.4M 2 2018-19 2019-20 Industrial Waste Permit User Fees – Fees paid by large industrial and commercial properties 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 demand on the system. Since the inception of the Permit User Fee program in 1970, users of the District’s system that discharge high volumes or high strength wastewater are required to obtain a discharge permit and pay for the full cost of service. $13.1M $13.2M Capital Facilities Capacity Charges (CFCC) – Capital Facilities Capacity Charge is a one-time, non-discriminatory charge imposed at the time a building or structure is newly connected to the District’s system, directly or indirectly, or an existing structure or category of use is expanded or increased. This charge pays for District facilities in existence at the time the charge is imposed, or to pay for new facilities to be constructed in the future, that are of benefit to the property being charged. $12.1M $12.5M Property Taxes – The County is permitted by State law (Proposition 13) to levy taxes at 1% of full market value (at time of purchase) and can increase the assessed value no more than 2% 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 from special districts to school districts that began in 1992-93. The District’s share of this revenue is dedicated for the payment of debt service. $98.3M $103.3M Interest Earnings – 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. $12.1M $16.3M Other Revenue – Other revenue includes solids handling and capital assessments from the Irvine Ranch Water District (IRWD); and O&M sewer services provided to IRWD, the Santa Ana Watershed Protection Authority (SAWPA), and the Sunset Beach Sanitary District. $37.1M $43.8M 3 2018-19 2019-20 Debt Proceeds – 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 viewed by the State of California as a share in an installment arrangement where the District serves as the purchaser. No new debt issuances are projected in the near-term. $0.0M $0.0M Financing If it is necessary that the District utilize debt financing to meet its total obligations and to meet projected construction schedules, the District uses long-term borrowing (Certificates of Participation (COP)) for capital improvements that cannot be financed from current revenue. Before any new debt is issued, the impact of debt service payments on total annual fixed costs is analyzed. No new debt issuance is currently being planned. The District Maintains its AAA Rating The District maintains ratings of “AAA” from S&P Global Ratings, Moody’s Investor Services, and Fitch Ratings. A triple A rating is the highest obtainable for any governmental agency. To maintain this rating, the District adheres to its Debt Policy and coverage ratios requirements. This Board-adopted policy serves as the agency’s guide in the management of existing debt and issuance of future debt. OCSD Has Contractual Covenants The District has contractual covenants within the existing COP agreements which require minimum coverage ratios of 1.25. The minimum coverage ratio is the ratio of net annual revenues available for debt service requirements to total annual debt service requirements for all senior lien COP debt. The coverage ratio for senior lien COP debt was approved at 3.43 for FY 2017-18. Orange County Sanitation District Reserve Summary - FY 2017-18 Orange County Sanitation District (OCSD) has a Board of Directors Reserve Policy that sets forth seven criteria to be used to determine its reserve level. As part of the OCSD financial and operating process, we have developed a Reserve Policy which governs the establishment of our reserve level and the use of those funds. To ensure an adequate and diverse reserve policy, we have established seven different criteria. These are not seven different reserves, but seven criteria used to set the total reserve level. Reserves can only be used with the approval of the Board of Directors. Below is a brief summary of the OCSD Reserve Criteria. Reserve Policy Summary Non-Discretionary 1) Debt Covenants and Other Requirements – Required by OCSD bondholders – $100 million – RESTRICTED This level is set by various bond covenants. As OCSD issues debt, it is required to maintain certain levels of reserves held specifically for repayment of that debt and cannot be reduced or used prior to repayment of all outstanding debt issuances. 2) “Dry Period” – Property Tax Payments – 50% of Operating Costs – $76 million The largest portion of OCSD revenues are user fees, approximately $300 million. These fees are listed on and collected through the County property tax bill. Since we receive payments twice each year, we hold funds in reserve specifically to pay operating expenses pending receipt of those payments. 3) “Dry Period” – Property Tax Payments – 100% of August Debt Service Costs – $83 million The largest portion of OCSD revenues are user fees, approximately $300 million. These fees are listed on and collected through the County property tax bill. Since we receive payments twice each year, we hold funds in reserve specifically to pay debt service pending the receipt of those payments. Discretionary 4) Operating Budget – 10% of the total Operating Budget as a Contingency – $15 million We hold ten percent of our operating budget as an operating contingency for non-recurring and unanticipated expenditures. 5) Capital Improvement Budget – 5% of the total $2 billion Program – $123 million OCSD currently has a ten-year, $2 billion Capital Improvement effort. We hold the equivalent of 5% of that total as a contingency specifically related to these Capital Improvement Program efforts. 6) Rehabilitation and Refurbishment – $66 million In 2002, OCSD established a reserve level related to rehabilitation efforts at $50 million based on the rehabilitation or replacement costs at that time. Although the total costs for rehabilitation or replacement has increased substantially since 2002 as a result of the move to Full Secondary Treatment and the Construction of GWRS, this reserve guideline has only been increases 2% annually, making it potentially under-funded. 7) Catastrophic loss / Self-insurance – $57 million OCSD is Self-Insured for Catastrophic Loss. $57 million of the District’s total reserves are related to holding funds for this category. Although OCSD now has more than $6 billion in assets, this level has not been increased since its establishment more than 10 years ago, making it potentially under-funded. Current 2017-18 Reserve Policy Requirement $520 million July 1, 2017 beginning of Year Reserve Balance $535 million ORANGE COUNTY SANITATION DISTRICT Agenda Terminology Glossary Glossary of Terms and Abbreviations AQMD Air Quality Management District ASCE American Society of Civil Engineers BOD Biochemical Oxygen Demand CARB California Air Resources Board CASA California Association of Sanitation Agencies CCTV Closed Circuit Television CEQA California Environmental Quality Act CIP Capital Improvement Program CRWQCB California Regional Water Quality Control Board CWA Clean Water Act CWEA California Water Environment Association EIR Environmental Impact Report EMT Executive Management Team EPA US Environmental Protection Agency FOG Fats, Oils, and Grease gpd gallons per day GWRS Groundwater Replenishment System ICS Incident Command System IERP Integrated Emergency Response Plan LOS Level Of Service MGD Million Gallons Per Day NACWA National Association of Clean Water Agencies NPDES National Pollutant Discharge Elimination System NWRI National Water Research Institute O & M Operations & Maintenance OCCOG Orange County Council of Governments OCHCA Orange County Health Care Agency OCSD Orange County Sanitation District OCWD Orange County Water District OOBS Ocean Outfall Booster Station OSHA Occupational Safety and Health Administration PCSA Professional Consultant/Construction Services Agreement PDSA Professional Design Services Agreement POTW Publicly Owned Treatment Works ppm parts per million PSA Professional Services Agreement RFP Request For Proposal RWQCB Regional Water Quality Control Board Glossary of Terms and Abbreviations SARFPA Santa Ana River Flood Protection Agency SARI Santa Ana River Interceptor SARWQCB Santa Ana Regional Water Quality Control Board SAWPA Santa Ana Watershed Project Authority SCADA Supervisory Control And Data Acquisition SCAP Southern California Alliance of Publicly Owned Treatment Works SCAQMD South Coast Air Quality Management District SOCWA South Orange County Wastewater Authority SRF Clean Water State Revolving Fund SSMP Sewer System Management Plan SSO Sanitary Sewer Overflow SWRCB State Water Resources Control Board TDS Total Dissolved Solids TMDL Total Maximum Daily Load TSS Total Suspended Solids WDR Waste Discharge Requirements WEF Water Environment Federation WERF Water Environment & Reuse Foundation WIFIA Water Infrastructure Finance and Innovation Act WIIN Water Infrastructure Improvements for the Nation Act WRDA Water Resources Development Act Activated sludge process – A secondary biological wastewater treatment process where bacteria reproduce at a high rate with the introduction of excess air or oxygen and consume dissolved nutrients in the wastewater. Benthos – The community of organisms, such as sea stars, worms, and shrimp, which live on, in, or near the seabed, also known as the benthic zone. Biochemical Oxygen Demand (BOD) – The amount of oxygen used when organic matter undergoes decomposition by microorganisms. Testing for BOD is done to assess the amount of organic matter in water. Biogas – A gas that is produced by the action of anaerobic bacteria on organic waste matter in a digester tank that can be used as a fuel. Biosolids – Biosolids are nutrient rich organic and highly treated solid materials produced by the wastewater treatment process. This high-quality product can be recycled as a soil amendment on farmland or further processed as an earth-like product for commercial and home gardens to improve and maintain fertile soil and stimulate plant growth. Glossary of Terms and Abbreviations Capital Improvement Program (CIP) – Projects for repair, rehabilitation, and replacement of assets. Also includes treatment improvements, additional capacity, and projects for the support facilities. Coliform bacteria – A group of bacteria found in the intestines of humans and other animals, but also occasionally found elsewhere, used as indicators of sewage pollution. E. coli are the most common bacteria in wastewater. Collections system – In wastewater, it is the system of typically underground pipes that receive and convey sanitary wastewater or storm water. Certificate of Participation (COP) – A type of financing where an investor purchases a share of the lease revenues of a program rather than the bond being secured by those revenues. Contaminants of Potential Concern (CPC) – Pharmaceuticals, hormones, and other organic wastewater contaminants. Dilution to Threshold (D/T) – The dilution at which the majority of people detect the odor becomes the D/T for that air sample. Greenhouse Gases (GHG) – In the order of relative abundance water vapor, carbon dioxide, methane, nitrous oxide, and ozone gases that are considered the cause of global warming (“greenhouse effect”). Groundwater Replenishment System (GWRS) – A joint water reclamation project that proactively responds to Southern California’s current and future water needs. This joint project between the Orange County Water District and the Orange County Sanitation District provides 70 million gallons per day of drinking quality water to replenish the local groundwater supply. Levels Of Service (LOS) – Goals to support environmental and public expectations for performance. N-Nitrosodimethylamine (NDMA) – A N-nitrosamine suspected cancer-causing agent. It has been found in the Groundwater Replenishment System process and is eliminated using hydrogen peroxide with extra ultra-violet treatment. National Biosolids Partnership (NBP) – An alliance of the National Association of Clean Water Agencies and Water Environment Federation, with advisory support from the US Environmental Protection Agency. NBP is committed to developing and advancing environmentally sound and sustainable biosolids management practices that go beyond regulatory compliance and promote public participation to enhance the credibility of local agency biosolids programs and improved communications that lead to public acceptance. Plume – A visible or measurable concentration of discharge from a stationary source or fixed facility. Glossary of Terms and Abbreviations Publicly Owned Treatment Works (POTW) – A municipal wastewater treatment plant. Santa Ana River Interceptor (SARI) Line – A regional brine line designed to convey 30 million gallons per day of non-reclaimable wastewater from the upper Santa Ana River basin to the ocean for disposal, after treatment. Sanitary sewer – Separate sewer systems specifically for the carrying of domestic and industrial wastewater. Combined sewers carry both wastewater and urban runoff. South Coast Air Quality Management District (SCAQMD) – Regional regulatory agency that develops plans and regulations designed to achieve public health standards by reducing emissions from business and industry. Secondary treatment – Biological wastewater treatment, particularly the activated sludge process, where bacteria and other microorganisms consume dissolved nutrients in wastewater. Sludge – Untreated solid material created by the treatment of wastewater. Total Suspended Solids (TSS) – The amount of solids floating and in suspension in wastewater. Trickling filter – A biological secondary treatment process in which bacteria and other microorganisms, growing as slime on the surface of rocks or plastic media, consume nutrients in wastewater as it trickles over them. Urban runoff – Water from city streets and domestic properties that carry pollutants into the storm drains, rivers, lakes, and oceans. Wastewater – Any water that enters the sanitary sewer. Watershed – A land area from which water drains to a particular water body. The Orange County Sanitation District’s service area is in the Santa Ana River Watershed.