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HomeMy WebLinkAbout04-09-2014 Administration Committee Agenda ORAKIJEODUNTY Orange County Sanitation District SANITATION DISTRICT Wednesday, April 9, 2014 Regular Meeting of the \ 5:30 P.M. Administration Committee 1 Administration Building Board Room 10844 Ellis Avenue fl� Fountain Valley, CA(714) 593-7130 AGENDA PLEDGE OF ALLEGIANCE: DECLARATION OF QUORUM: PUBLIC COMMENTS: If you wish to speak, please complete a Speaker's Form and give it to the Clerk of the Board. Speakers 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. REPORT OF DIRECTOR OF FINANCE AND ADMINISTRATIVE SERVICES: CONSENT CALENDAR: 1. Approve Minutes of the March 12, 2014, Administration Committee Meeting. NON-CONSENT CALENDAR: 2. Recommend to the Board of Directors to: Authorize the General Manager to issue new fixed rate Certificates of Participation (COP), to be referred to as Wastewater Refunding Revenue Obligations, in an amount sufficient to refund up to $267.3 million of COP Series 2007B. 04/09/14 Administration Committee Agenda Page 1 of 3 INFORMATION ITEMS: 3. Status of 2014-15 Insurance Renewals 4. FY 2014-15 Capital Improvement Program Update 5. Community Outreach Program Update 6. FY 2014-15 and 2015-16 Budget CLOSED SESSION: During the course of conducting the business set forth on this agenda as a regular meeting of the Administration Committee, the Chair may convene the Committee in closed session to consider matters of pending real estate negotiations, pending or potential litigation, or personnel matters, pursuant to Government Code Sections 54956.8, 54956.9, 54957 or 54957.6, as noted. Reports relating to (a) purchase and sale of real property; (b) matters of pending or potential litigation; (c) employment actions or negotiations with employee representatives;or which are exempt from public disclosure under the California Public Records Act, may be reviewed by the Board during a permitted closed session and are not available for public inspection. At such time as the Board takes final action on any of these subjects, the minutes will reflect all required disclosures of information. Convene in closed session. (1) CONFER WITH LABOR NEGOTIATORS (Government Code Section 54957.6) Agency Designated Representatives: Steve Filarsky, James Ruth, James Herberg, Robert Ghirelli, Jeff Reed, and Richard Spencer. Employee Organizations: 3 • Orange County Employees Association (OCEA); • International Union of Operating Engineers, Local 501; and • Supervisor and Professional Group OTHER BUSINESS AND COMMUNICATIONS OR SUPPLEMENTAL AGENDA ITEMS, IF ANY: ADJOURNMENT: The next Administration Committee meeting is scheduled for Wednesday, May 14, 2014 at 5:30 p.m. 04/09/14 Administration Committee Agenda Page 2 of 3 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) 593-7130 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. 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. Made E.Ayala Clerk of the Board (714)593-7130 mavalalglocsd.com For any questions on the agenda,Committee members may contact staff at: General Manager James Herberg (714)593-7300 iherberofgocsd.com Assistant General Manager Bob Ghirelli (714)593-7400 rohirelli0ocsd.com Director of Finance and Lorenzo Tyner (714)593-7550 Itvnerfrpocsd.com Administrative Services Director of Human Resources Jeff Reed (714)593-7144 ireeddocsd.com 04/09/14 Administration Committee Agenda Page 3 of 3 ITEM NO. 1 CORRECTED MINUTES OF THE REGULAR MEETING OF THE ADMINISTRATION COMMITTEE Orange County Sanitation District Wednesday, March 12, 2014, at 5:30 P.M. A regular meeting of the Administration Committee of the Orange County Sanitation District was held on March 12, 2014, at 5:35 p.m., in the Sanitation District's Administration Building. Committee Chair Reese led the Flag Salute. A quorum was declared present, as follows: COMMITTEE MEMBERS PRESENT: STAFF PRESENT: Brad Reese, Chair Jim Herberg, General Manager John Withers, Vice-Chair Bob Ghirelli, Assistant General Manager David Benavides Lorenzo Tyner, Director of Finance Joe Carchio &Administrative Services Steven Choi Jeff Reed, Director of Human Resources Tyler Diep Rob Thompson, Director of Engineering James Ferryman Ed Torres, Director of Operations and Gene Hernandez Maintenance Peter Kim Nick Arhontes, Director of Facilities Prakash Narain Support Services Teresa Smith Kelly Lore, Secretary Pro Tem Troy Edgar, Board Chair Jeff Armstrong Tom Beamish, Board Vice-Chair Wes Bauer Jennifer Cabral COMMITTEE MEMBERS ABSENT: Sam Choi Janet Nguyen Ron Coss Norbert Gaia Al Garcia Dave Halverson Mike Von Winckelmann OTHERS PRESENT: Brad Hogin, General Counsel PUBLIC COMMENTS: None. 03 12 2014 Administration Committee Minutes Page 1 of 5 REPORT OF COMMITTEE CHAIR: Committee Chair Reese did not provide a report. REPORT OF GENERAL MANAGER: General Manager, Jim Herberg, introduced Rob Thompson as the newly appointed Director of Engineering. REPORT OF DIRECTOR OF FINANCE AND ADMINISTRATIVE SERVICES: Lorenzo Tyner, Director of Finance, did not provide a report. CONSENT CALENDAR: 1. MOVED, SECONDED, AND DULY CARRIED: Approve Minutes of the February 19, 2014 Administration Committee Meeting. AYES: Beamish, Benavides, Carchio, Choi, Diep, Edgar, Ferryman, Hernandez, Kim, Narain, Reese and Withers NOES: None ABSTENTIONS: None ABSENT: Nguyen and Smith 2. MOVED, SECONDED, AND DULY CARRIED: Recommend to the Board of Directors to: Adopt Resolution No. OCSD 14-XX, adopting a Conflict of Interest Code which supersedes all prior Conflict of Interest Codes and amendments previously adopted. AYES: Beamish, Benavides, Carchio, Choi, Diep, Edgar, Ferryman, Hernandez, Kim, Narain, Reese and Withers NOES: None ABSTENTIONS: None ABSENT: Nguyen and Smith 03/12/2014 Administration Committee Minutes Page 2 d 5 3. MOVED, SECONDED, AND DULY CARRIED: Recommend to the Board of Directors to: Approve Service Contract to provide services for industrial hygiene, S-2013- 590BD for a one-year plus four optional renewals effective July 1, 2014, for an amount not to exceed $500,000 with the following firm: Malcolm Pirnie/Arcadis. AYES: Beamish, Benavides, Carchio, Choi, Diep, Edgar, Ferryman, Hernandez, Kim, Narain, Reese and Withers NOES: None ABSTENTIONS: None ABSENT: Nguyen and Smith 3. MOVED, SECONDED, AND DULY CARRIED: Recommend to the Board of Directors to: Adopt Resolution No. OCSD 14-XX, A Resolution of the Board of Directors of the Orange County Sanitation District Adopting a Revised Policy Regarding Board of Directors' Expense Reimbursement and Meeting Attendance and Compensation and Repealing Resolution No. OCSD 06-11. AYES: Beamish, Benavides, Carchio, Choi, Diep, Edgar, Ferryman, Hernandez, Kim, Narain, Reese and Withers NOES: None ABSTENTIONS: None ABSENT: Nguyen and Smith NON-CONSENT: 5. MOVED, SECONDED, AND DULY CARRIED: Recommend to the Board of Directors to: A. Introduce Ordinance No. OCSD-XX, entitled "An Ordinance of the Board of Directors of Orange County Sanitation District Amending Ordinance No. OCSD-34 Pertaining to the Compensation of the Members of the Board of Directors"; and 0N12/2014 Administration Committee Minutes Page 3 of 5 B. Motion to read Ordinance No. OCSD-XX by title only and waive reading of said entire Ordinance on March 26, 2014; and C. Set April 23, 2014, as the date of the Public Hearing to hear protests and for the second reading and adoption of Ordinance No. OCSD-XX. D. Direct the Clerk of the Board to publish summaries of the Ordinance as required by law. AYES: Beamish, Benavides, Carchio, Choi, Diep, Edgar, Ferryman, Hernandez, Kim, Narain, Reese and Withers NOES: None ABSTENTIONS: None ABSENT: Nguyen and Smith INFORMATION ITEMS: 6. Ocean Water Quality and Disinfection Program Director of Operations and Maintenance Ed Torres introduced Environmental Lab & OM Manager, Ron Coss who provided a brief PowerPoint regarding the history of the disinfection program and an update regarding the strategic initiative on optimization of effluent disinfection using bleach. He introduced the three principal investigators behind the studies; Environmental Supervisor, Dr. Jeff Armstrong (Head of Ocean Monitoring Group), Laboratory Supervisor, Mike Von Winckelmann (Head of Microbiology General Chemistry Group) and Principal Laboratory Analyst, Dr. Sam Choi (Lead Microbiologist). Mr. Coss answered questions from the Committee regarding; reduction or elimination of disinfection, and outreach to stakeholders. (Director Theresa Smith arrived at 5:45 p.m.) 7. FY 2014-15 and FY 2015-16 Budget Update Director of Finance and Administrative Services Lorenzo Tyner introduced Controller, Mike White who provided a PowerPoint presentation on Budget Development Revenues for Fiscal Years 2014-15 and 2015-16. 03/12/2014 Administration committee Minutes Page 4 of 5 CLOSED SESSION: The Board did not convene in closed session. Director of Human Resources Jeff Reed announced that a meet and confer session is scheduled with the Supervisor and Professional Groups for tomorrow at which time District representatives will carry out the Board's direction from its last closed session meeting. He also stated that the Orange County Employees Association (OCEA) has formally requested a meet and confer and has also requested a financial overview. OTHER BUSINESS AND COMMUNICATIONS OR SUPPLEMENTAL AGENDA ITEMS, IF ANY: None. ADJOURNMENT: Committee Chair Reese declared the meeting adjourned at 6:05 p.m., to the next regularly scheduled meeting of April 9, 2014. Submitted by: Kelly A. Lore Secretary Pro Tem 0 311 2 2014 Administration Committee Minutes Page 5 d 5 ADMINISTRATION COMMITTEE "I'm,Date T1.1 of Dir. 04/09/14 4/23/14 AGENDA REPORT Item Number Item Number z Orange County Sanitation District FROM: James D. Herberg, General Manager Originator: Lorenzo Tyner, Director of Finance and Administrative Services SUBJECT: WASTEWATER REFUNDING REVENUE OBLIGATIONS, SERIES 2014A GENERAL MANAGER'S RECOMMENDATION Authorize the General Manager to issue new fixed rate Certificates of Participation (COP), to be referred to as Wastewater Refunding Revenue Obligations, in an amount sufficient to refund up to $267.3 million of COP Series 2007B. SUMMARY Tax-exempt interest rates increased significantly from May 2013 through September 2013 due to market concems that the Federal Reserve would start to taper their $85 billion of monthly bond purchases in the coming months. However, due to the lack of municipal new issuance volume this year, tax-exempt yields have dropped in 2014 as shown in the recent rate history for the AAA GO Municipal Market Data Index for 10- year maturities below: 10-Year Maturities AAA MMD January 1, 2013 to Present 3.5% 3.0% 2.5% 2.0% 1.5% n n m m m m n n rn m m m v v v Date With the decline in interest rates, there is the potential opportunity to refinance a portion of the outstanding COP Series 2007B to reduce interest costs for the Sanitation District. Page 1 of 4 Under current market conditions, nine maturities of the COP Series 2007B, equal to $82.3 million, may be advance refunded generating 7% present value savings, or $6 million (the minimum percentage required by the Sanitation District's debt policy is 3%). The savings are contingent on market conditions at the time of the refunding sale; however, if interest rates decline even further, additional maturities could also be refunded and produce the requisite savings targets. The outstanding amount of COP Series 2007B is currently $267.3 million. Approval of the recommended actions above will direct staff to begin the process of refunding a portion of the outstanding $267.3 million COP Series 2007B debt utilizing the assistance of Public Resources Advisory Group (PRAG), as financial advisor, and the bond counsel fine of Fulbright & Jaworski. PRIOR COMMITTEE/BOARD ACTIONS September 20, 2012: Adopt Resolution No. OCSD 12-12, authorizing the execution and delivery by the District of an Installment Purchase Agreement, a Trust Agreement and a Continuing Disclosure Agreement in connection with the execution and delivery of Orange County Sanitation District Revenue Refunding Certificate Anticipation Notes, Series 2012C, such Notes evidencing principal in an aggregate amount of not to exceed $145,000,000, approving a Notice of Intention to Sell, authorizing the distribution of an Official Notice Inviting Bids and an Official Statement in connection with the offering and sale of such Notes and authorizing the execution of other necessary documents and related actions. September 25, 2013: Adopt Resolution No. OCSD 13-14, authorizing the execution and delivery by the Orange County Sanitation District of an Installment Purchase Agreement, a Trust Agreement and a Continuing Disclosure Agreement in connection with the execution and delivery of Orange County Sanitation District Revenue Refunding Certificate Anticipation Notes, Series 2013A, authorizing the execution and delivery of such Notes evidencing principal in an aggregate amount of not to exceed $135,000,000, approving a Notice of Intention to Sell, authorizing the distribution of an Official Notice Inviting Bids and an Official Statement in connection with the offering and sale of such Notes and authorizing the execution of necessary documents and related actions. Page 2 of 4 ADDITIONAL INFORMATION The Sanitation District currently has ten series of debt issuances outstanding in the par amount of $1.23 billion. The table on the following page lists each issuance, the outstanding amount, and the interest rate mode. Outstandin Interest Rate m Par Aount) Mode eries 2013A CANS(4) $ 129,625,000 Fixed Rate (one-year) eries 2012B Refunding(2) 66,395,000 Fixed Rate eries 2012A Refunding(3) 100,645,000 Fixed Rate eries 2011A Refunding(2x3) 130,345,000 Fixed Rate eries 20100) 157,000,000 Fixed Rate eries 2010A(a) 80,000,000 Fixed Rate eries 2009A Refunding(3) 184,090,000 Fixed Rate eries 2008B Refunding(6) 25,585,000 Fixed Rate eries 200713(a) 267,255,000 Fixed Rate eries 2007A Refunding(3) 92,385,000 Fixed Rate Total : $1,233,325,000 (1) As of March 1,2014 (2) Refunded a portion of Series 2000 (3) Refunded a portion of Series 2003 (4) Series 2013A are fixed one-year certificate of anticipation notes(CANS), that refunded the Series 2012C CANS, that refunded the Series 2011E CANS, that refunded the 2010E CANS, that refunded the Series 2009E CANS, that refunded the 2008C CANS that were issued to refund the Series 20M Daily Variable Rate that were supported by a weak liquidity facility bank. (5) New money debt issue (6) Series 2008E refunded the Series 1993 Synthetic Variable-to-Fixed Rate Debt issues that were supported by a failing insurance provider. Series 1993 and 1992 refunded the Series 1986 and a portion of the Series W COPs. Refunding Strateav Under current market conditions, staff is proposing to refund $82.3 million of COP Series 2007E maturing in years 2018 through 2026 with annual coupon rates of 4.00% and 5.00%, as shown in the chart below. A refunding of these maturities would produce $6.01 million in present value savings (7.3% of refunded par) in the current market. Additional bond maturities may be refunded depending on the market rates at the time of issuance. Maturity Principal Amo 02/01/18 $ 7,470,000 5.00% 02/01/17 02/01/19 7,840,000 5.00% 02/01/17 02/01/20 8,235,000 4.00% 02/01/17 02/01/21 8,645,000 5.00% 02/01/17 02/01/22 9,075,000 5.00% 02/01/17 Page 3 of 4 Principal Am 02/01/23 9,530,000 5.00% 02/01/17 02/01/24 10,005,000 5.00% 02/01/17 02/01/26 10,510,000 5.00% 02/01/17 02/01/26 11,035,000 5.00% 02/01/17 Total : $ 82,345,000 Timeline Since the proposed refunding is a fixed-rate debt issuance, staff is proposing to issue the refunding through a competitive sale because it is the most expeditious way to access the market and it is expected to provide the lowest interest cost for this given structure. ➢ Board approval of legal and disclosure documents ➢ Financing Corporation approval of legal and June disclosure documents ➢ Rating Agency discussions ➢ Publish Notice of Intention to Sell July ➢ Marketing and Sale through a Competitive Sale Process August ➢ Closing ➢ Begin debt administration All costs involved with the refunding, including costs for PRAG and Fulbright & Jaworski will be paid from the proceeds of the new refunding issue. CEQA N/A BUDGET/DELEGATION OF AUTHORITY COMPLIANCE N/A Page 4 of 4 ADMINISTRATION COMMITTEE Meebng Date To ad.ofDir. 04,09,14 -- AGENDA REPORT Item Number Item Number 3 Orange County Sanitation District FROM: James D. Herberg, General Manager Originator: Lorenzo Tyner, Director of Finance &Administrative Services SUBJECT: STATUS OF 2014-15 INSURANCE RENEWALS GENERAL MANAGER'S RECOMMENDATION Information Only. SUMMARY Historically, the Administration Committee has asked for status updates regarding the renewals of major insurance policies each year. The Risk Management Division and the Sanitation District's operational insurance broker begin the process of renewal each January, and final quotes are typically received in June shortly before the beginning of the new fiscal year. The Sanitation District budget provides funds for the renewal of the following four major insurances for District operations: 1) Excess General Liability Insurance 2) Excess Workers' Compensation 3) All-Risk Property and Flood insurance 4) Boiler& Machinery insurance PRIOR COMMITTEE/BOARD ACTIONS June 2013 — The Board approved renewal of the above four policies for the period July 1, 2013 through June 30, 2014. ADDITIONAL INFORMATION 1) Excess General Liability Insurance Program The Sanitation District's Excess General Liability Insurance Program is currently provided through the California Municipal Excess Liability Program (CAMEL) and its sister program, the Alliant National Municipal Liability Program (ANML). The Sanitation District has participated in the CAMEL program since FY 1996-97. Page 1 of 4 ADDITIONAL INFORMATION (cont'd) This program currently provides the Sanitation District with a $30 million policy of comprehensive coverage for municipal liability, bodily injury and property damage, and personal injury. The program was structured to also include Employment Practices, and Public Officials Errors & Omissions coverage. The $30 million coverage has a self-insured deductible of $250,000 per occurrence and $500,000 deductible for employment practices claims. Since 1997, the Employment Practices portion of coverage has been enhanced from a $2 million sub-limit to the full $30 million policy limit. The actual insurance coverage currently consists of two separate layers. The first layer is the "Basic" $10 million program with self-insured retention of $250,000. The second layer is $20 million of coverage in excess of the first layer of$10 million. The premium for 2013-14 was $371,642. 2) Excess Workers' Compensation Insurance The Excess Workers' Compensation insurance coverage is with the California State Association of Counties Excess Insurance Authority (CSAC EIA). The Sanitation District has participated in this program or its predecessor since 2003. Excess Workers' Compensation Program currently provides so-called "Statutory" (unlimited) coverage with a self-insured retention (SIR), or deductible, of$750,000. The use of Excess Workers' Compensation Insurance dates back to the late 1980's. At that time, the Fiscal Policy Committee approved an SIR, or deductible, of $250,OOO, for such coverage. Due to the hardening of the workers' compensation market, this deductible was raised to $500,000 beginning in FY 2002-03 through a policy with Employers Reinsurance Corporation (ERC) that provided coverage at the time of $25 million with a self-insured retention (SIR), or deductible of$500,000. Some additional risk may be associated with the CSAC EIA joint powers authority in that a premium surcharge can be assessed to individual members if an unusually large number of losses were to occur outside of the actuarial evaluation estimates. However, historically the CSAC EIA premiums for excess workers compensation have been so much less than competing quotes available to the Sanitation District that even if there were a surcharge, the cost might still continue to be cheaper. The renewal of the Excess Workers' Compensation Insurance for the period July 1, 2013 through June 30, 2014 was at a rate of .00307. This premium rate generated an estimated premium of approximately $198,000 based on the estimated 2013-14 payroll. Since the premium itself is based on final payroll, the Sanitation District will not know the exact final premium until the year is over. Page 2 of 4 ADDITIONAL INFORMATION (cont'd) 3) All-Risk Property and Flood Insurance The All-Risk Property and Flood Insurance Program (Property Insurance) provides for comprehensive coverage for most of the Sanitation District's real and personal property regarding virtually all perils including fire, flood, and business interruption. The Sanitation District previously carried earthquake insurance as part of its Property Insurance, but in the last few years earthquake insurance has been impossible to obtain or not cost-effective. Current Property Insurance limits are $1 billion for most perils other than flood and earthquakes, and $300 million for flood, with many sub-limits for various situations. In order to reach $1 billion in limits, the broker had to arrange for more than a dozen different insurers. The SIR is $250,000 per occurrence for most types of losses. Since the late 1990's, the Property Insurance has been with a nationwide joint purchase property insurance program called Public Entity Property Insurance Program (PEPIP), one of the world's largest property programs. It is important to note that this joint purchase property insurance program offers the purchasing power of numerous large public entities without the pooling or sharing of coverage or losses. The renewal of All-Risk Property and Flood Insurance for the period July 1, 2013 through June 30, 2014 was at a premium of$681,286. 4) Boiler& Machinery Insurance The Boiler & Machinery insurance program provides comprehensive coverage for loss caused by machinery breakdown and explosion of steam boilers or other covered process equipment, including damage to the equipment itself and damage to other property caused by covered accident. The current Boiler & Machinery insurance program provides coverage ($100 million per occurrence with deductibles ranging from $25,000 to $350,000) for losses caused by covered machinery breakdown (e.g., motors, steam turbines, digesters, co-gen engines). Damages to the equipment, as well as damages to other property and improvements caused by the machinery breakdown, are covered by the boiler & machinery insurance. This program augments the Sanitation District's all-risk property insurance that covers perils such as fire and flood. The renewal of the Boiler & Machinery Insurance Program for the period July 1, 2013 through June 30, 2014 was at $24,280. Page 3 of 4 CEQA N/A BUDGET/DELEGATION OF AUTHORITY COMPLIANCE N/A ATTACHMENTS None Page 4 of 4 ADMINISTRATION COMMITTEE Meeting Date To Bit of Dlr. 04/09/14 -- AGENDA REPORT em Number Item Number 9 Orange County Sanitation District FROM: James D. Herberg, General Manager Originator: Rob Thompson, Director of Engineering SUBJECT: CAPITAL IMPROVEMENT PROGRAM UPDATE GENERAL MANAGER'S RECOMMENDATION Information Only. SUMMARY Staff will present an informational overview on the status and performance of the Capital Improvement Program (CIP) over the fiscal year to date. PRIOR COMMITTEE/BOARD ACTIONS None. ADDITIONAL INFORMATION N/A CEQA N/A BUDGET/DELEGATION OF AUTHORITY COMPLIANCE N/A ATTACHMENT N/A DF:dm:gc Page 1 of 1 ADMINISTRATION COMMITTEE Neebng Date To ad.of Dir. 04,09,14 -- AGENDA REPORT Item Number Item Number s Orange County Sanitation District FROM: James D. Herberg, General Manager Originator: Robert P. Ghirelli, Assistant General Manager SUBJECT: OCSD'S COMMUNITY OUTREACH PROGRAM GENERAL MANAGER'S RECOMMENDATION Information Only. SUMMARY As part of the ongoing Board Member Orientation effort, OCSD staff will provide a general presentation on specific topics that the Board of Directors requested via a survey conducted in October 2013. Each month a different topic will be presented to both the Operations Committee and Administration Committee. PRIOR COMMITTEE/BOARD ACTIONS N/A ADDITIONAL INFORMATION The following informational presentations have been provided to both Operations and Administration Committees: • February— OCSD Budget and Finances • March —Water Quality and OCSD's Disinfection Program CEQA N/A BUDGET/DELEGATION OF AUTHORITY COMPLIANCE N/A ATTACHMENT None Page 1 of 1 ADMINISTRATION COMMITTEE Meeting Date To ad.of Dir. 04/09/14 -- AGENDA REPORT Item Number Item Number 6 Orange County Sanitation District FROM: James D. Herberg, General Manager Originator: Lorenzo Tyner, Director of Finance and Administrative Services SUBJECT: FY 2014-15 AND 2015-16 BUDGET GENERAL MANAGER'S RECOMMENDATION Information Only. SUMMARY Discussion of the OCSD FY 2014-15 and 2015-16 Budget was initiated at the February 19, 2014 Administration Committee meeting. Additional materials are now being provided to further this discussion (attached). Included in the materials being provided are line-item details for the Operating Budget. The Budget will be presented for adoption at the June 25, 2014 Board meeting. PRIOR COMMITTEE/BOARD ACTIONS N/A ADDITIONAL INFORMATION N/A CEQA N/A BUDGET / DELEGATION OF AUTHORITY COMPLIANCE N/A Paps 2 of 2 ATTACHMENTS The following attachment(s) are attached in hard copy and may also be viewed on-line at the OCSD website(www.ocsd.coml with the complete agenda package and attachments: FY 2014-15 and 2015-16 Budget Summary FY 2014-15 and 2015-16 Budget Development-Additional Detail JH:LT:MW/imf Page 2 of 2 ATTACHMENT NO. 1 2014.15 and 2015.16 Budget Development - Expenditure Summary 2013-14 2013-14 2014-15 2015-16 Description Budget Projected Proposed Proposed 1 Salaries & Wages $65.4 $61.4 $63.3 $64.0 2 Benefits 32.6 32.5 36.9 37.6 3 Operating Materials & Supplies 16.9 15.4 16.4 17.0 4 Contractual Services 23.3 21.9 23.2 24.1 5 Repairs & Maintenance 11.2 9.2 12.0 12.5 6 Utilities 7.7 6.7 7.1 7.4 7 Professional Services 3.6 2.7 2.9 3.0 8 Other Operating Supplies 2.5 2.0 1.5 1.7 9 Administrative Expenses 1.1 1.2 1.3 1.4 10 Research & Monitoring 0.9 0.7 0.7 0.7 11 Other Non-Operating Expenses 0.7 0.1 1.0 1.0 12 Training & Meetings 1.2 0.7 0.8 0.8 13 Printing & Publication 0.4 0.3 0.3 0.3 14 Cost Allocation (18.2) (13.9) (14.7) (15.3) Net Operating Requirements $149.3 $140.9 $152.7 $156.2 ATTACHMENT NO. 2 2014-15 AND 2015-16 BUDGET DEVELOPMENT - ADDITIONAL DETAIL Projected Proposed Proposed 2013-14 2014-15 2015-16 1) SALARIES AND WAGES $61.4 $63.3 $64.0 1a) Salaries $57.7 $59.4 $60.1 Salaries for 626 full-time equivalent (FTE) positions for all three years shown above are included in this line item. Salary increases have only been included per existing bargaining agreements. The Vacancy Factor was raised from the past trend of 3 percent to 5 percent based on the high volume of recent and near-future retirements, and the time it will take to become fully staffed. 1 b) Leave Payoffs $ 2.2 $ 2.3 $ 2.3 Leave Payoffs for retirements are anticipated to remain constant for the next two years. 1c) Overtime $ 1.5 $ 1.6 $ 1.6 Overtime has remained constant at $1.5 million over the last several years. Of this total, approximately $1.2 million is budgeted in Operations and Maintenance primarily for required overtime as the plants are in operation 24/7 (vacation, sick, shift overlap), emergencies, unscheduled maintenance, backlog and off-shift construction support. The remaining $300,000 is budgeted in other divisions and also has remained essentially flat. 2) BENEFITS $32.5 $36.9 $37.6 2a) Retirement $23.0 $26.6 $26.8 District employees are members of the Orange County Employees' Retirement System (OCERS). The employer's required contribution rate has been increased by OCERS from 31.95 percent (FY 2013-14) to 36.57 percent (FY2014-15). 2b) Group Insurance $ 8.5 $ 8.9 $ 9.4 Includes Medical, Dental, Vision, Life Insurance, Medicare, Disability. 2c) Benefits, Other $ 1.0 $ 1.4 $ 1.4 Includes Workers' Compensation, Tuition Reimbursement, Development Pay and Uniform Rental. Workers' Compensation ($0.76 million in FY 2014-15 and $0.79 million in FY 2015-16) is used to maintain the level of accumulated reserves within the Workers' Compensation self-insurance funds. The Development Pay Program ($300,000) is intended to promote employee efforts that increase job knowledge, skills, and abilities. 1 2014-15 AND 2015-16 BUDGET DEVELOPMENT — ADDITIONAL DETAIL Projected Proposed Proposed 2013-14 2014-15 2015-16 3) OPERATING MAT'LS & SUPPLIES $15.4 $16.4 $17.0 3a) Chemical Coagulants $ 5.8 $ 6.0 $ 6.3 Anionic Polymer—Anionic polymer is added to the primary clarifiers in combination with ferric chloride to enhance primary clarifier performance. The budget for FY 2014- 15 is $403,000 with FY2015-16 increasing to $419,000 because of a 4 percent anticipated unit rate increase. Cationic Polymer— Cationic polymer is added to digested sludge prior to dewatering in order to improve the sludge and water separation process. Cationic polymer is also added to the waste activated sludge dissolved air flotation thickeners (DAFTs)to improve solid(s) coagulation. Usage at both plants have increased because of additional secondary sludge production as Plant No. 1 now operates two activated sludge facilities, and the new trickling filters at Plant 2 are fully operational. The anionic polymer budgets are $1,548,000 for FY 2014-15 and $1,610,000 in FY 2015- 16. Ferric Chloride— Ferric chloride is an iron salt which is currently used to increase the solids removal efficiencies in the primary treatment process and to control digester hydrogen sulfide. As the amount of ferric chloride is optimized in primary treatment an additional amounts of ferric chloride are added to the digesters to control hydrogen sulfide. The projected ferric chloride budget for FY 2014-15 is $4,090,000 and $4,254,000 in FY2015-16, a 4 percent increase due to anticipated unit rate increase. 3b) Odor Control $ 6.9 $ 7.3 $ 7.6 Hydrogen Peroxide— Hydrogen peroxide is used in the foul air scrubbers to control hydrogen sulfide and in the trunk sewers for control of sulfides. The projected budget for FY 2014-15 is $1,109,000 and $1,153,000 in FY 2015-16, a 4 percent increase due to anticipated rate increases. Sodium Hydroxide (Caustic Soda)— Caustic soda is used in the foul air scrubbers and in the District's main trunk lines tributary to the treatment plants. The projected total cost of caustic soda for FY 2014-15 is $532,000 and $553,000 in FY2015-16. Muriatic Acid — Muriatic Acid (hydrochloric Acid) is used to backwash the media in the foul air scrubbers, associated piping, and pumps. This cleans deposits caused by hard water, sulfides from the reaction with the foul air, and caustic soda used in the scrubbing process. The projected budget for FY 2014-15 is $28,000. Odor Neutralizers—Odor neutralizers are used in the solids processing facilities of both plants to mask the odors from the processed biosolids as they are loaded into the 2 2014-15 AND 2015-16 BUDGET DEVELOPMENT — ADDITIONAL DETAIL Projected Proposed Proposed 2013-14 2014-15 2015-16 trucks for reuse. In FY 2014-15 and FY 2015-16, the projected budgets are $2,600 and $2,700 respectively. Magnesium Hydroxide, Trunklines— Magnesium hydroxide reduces the formation of hydrogen sulfide which causes odor and corrosion. Contract services include supply, operational monitoring, sampling, reporting and on-going maintenance services for odor control chemical dosing systems within the wastewater collection and conveyance system. The projected expense for FY 2014-15 is $1,875,000. In FY 2015-16, the proposed usage is the same at a proposed cost of$1,950,000, assuming a 4 percent unit cost increase. Ferrous Chloride, Trunklines— Ferrous Chloride is used in the trunks to reduce hydrogen sulfide generation. This contract provides supply, operational monitoring, sampling, reporting and on-going maintenance services for odor control chemical dosing systems within the wastewater collection and conveyance system. In FY 2014-15, the projected expense is $2,800,000. In FY 2015-16, the proposed budget increases to $2,912,000 because of an estimated rate increase of 4 percent. Calcium Nitrate, Trunklines— Calcium nitrate is a biological approach to controlling odors in wastewater. It provides the naturally occurring bacteria with an alternate source of oxygen which, when metabolized, produces nitrogen gas as a byproduct rather than the sulfides produced by the naturally occurring sources of oxygen. The budget projected usage for FY 2014-15 is $775,000. The FY 2015-16 proposed use is the same with, an increase in budgeted cost of$806,000 due to an estimated 4 percent unit rate increase. Bleach, Treatment Plant Odor Control — The projected total cost of odor control bleach for FY 2014-15 is $185,000. For FY 2015-16, staff proposes an estimated budget of$192,400, a 4 percent increase. 3c) Disinfection $ 0.3 $ 0.5 $ 0.5 Sodium Hypochlorite (Bleach)—Approximately 80% of all bleach is used for effluent disinfection. The remaining treatment plant bleach usage is disinfection of plant water and odor control. It is anticipated that the District treatment plant bleach budgets will be $445,000 in FY 2014-15 and $463,000 in FY 2015-16. Sodium Bisulfite— Sodium bisulfite is used for dechlorination of outfall effluent at Plant 2 to ensure that no residual chlorine is discharged into the ocean. The sodium bisulfite costs are expected to be $30,000 and $31,000 in FY 2014-5 and FY 2015-16 respectively. 3d) Tools and Safety Equipment/Tools $ 0.9 $ 0.9 $ 0.9 O&M, FSSD, and Safety use 98% of these budgets. There has been an increase in these budgets since the definition of capital equipment has changed; tools and 3 2014-15 AND 2015-16 BUDGET DEVELOPMENT — ADDITIONAL DETAIL Projected Proposed Proposed 2013-14 2014-15 2015-16 equipment that cost less than $5,000 have a minimum useful life of three years and are not considered to be capital. Personal Protective Equipment requirements have increased, and there are different tools needed to maintain the new facilities. 3e) Laboratory Chemicals and Supplies $ 0.6 $ 0.7 $ 0.7 Over 90% of this budget supports the Environmental Sciences Laboratory purchases of glassware, filtration supplies, solvents used for organic extractions, acids and bases used in metals digestion and glassware cleaning, reagents, a variety of standards used in quality assurance of the tests, specialty gases, microbiology supplies and growth media, chromatography columns, test organisms for bioassay, toxicity, and various other laboratory supplies. 3f) Gas, Diesel and Oil $ 0.6 $ 0.7 $ 0.7 Vehicle and vessel gasoline and diesel fuel, compressed natural gas, diesel and oil used in the operation of the mobile equipment, within generators and other operating equipment are included in these budgets. The future price of gasoline and natural gas are the major impacts to these budgets. 3g) Other $ 0.3 $ 0.3 $ 0.3 Other smaller operating expenses collectively reported within this one line item such as janitorial supplies and miscellaneous operating supplies. 4) CONTRACTUAL SERVICES $21.9 $23.2 $24.1 4a) Solids Removal $16.6 $17.4 $18.1 Biosolids — Solids production for FY 2013-14 has increased with the operation of the new secondary facilities at both treatment plants. The total cost for FY 2014-15 is projected to be $17,442,000, a 4.8 percent increase over FY 2013-14, and $18,140,000 in FY 2015-16, an increase of 4.0 percent. These increases are attributable to project increases in the hauling transportation costs. 4b) Other Residual Solids and Waste $ 0.8 $ 0.9 $ 0.9 The other residual solids and waste category includes disposal costs for grit and screening waste, digester cleaning waste, and hazardous materials. The Grit and Screening budget includes supplying bins to collect then haul and dispose of grit, screenings, and drying bed material to a landfill. The grit is generated from the grit chambers, and the screenings is the material collected off the bar screens. Drying bed material is typically made up of the material cleaned out of pipes in the collection system by District's crews and other city crews in the District's service area. 4 2014-15 AND 2015-16 BUDGET DEVELOPMENT — ADDITIONAL DETAIL Projected Proposed Proposed 2013-14 2014-15 2015-16 4c) Grounds keeping/Janitorial/Security $ 1.0 $ 1.2 $ 1.3 The Security Services budget is projected to increase from the FY 2013-14 projected of $380,000 to $571,000 in FY 2014-15, a $191,000 or 50 percent increase, in order to increase roving patrol and additional guards to monitor all video cameras 24/7 based upon security audit recommendation. The Security Service budget is proposed to increase an additional 4 percent to $594,000 in FY 2015-16. The Grounds keeping and Janitorial Service budgets are mostly limited to inflationary increases. 4d) County Service Fee $ 0.6 $ 0.7 $ 0.7 The County Service Fee is the fee charged by the County of Orange for the inclusion of the District's sanitation fees on the County of Orange Property Tax Bill and for the collection of these fees by the County on behalf of the District. 4e) Oxygen Plant Operations $ 0.7 $ 0.7 $ 0.7 Ultimately the oxygen plant will be decommissioned and the oxygen will be provided by a new vapor technology. The costs for purchased oxygen are included in the budget. 4f) Temporary Services $ 0.3 $ 0.4 $ 0.4 District staff has greatly decreased the use of temporary services by eliminating long- term temporary help and finding alternative solutions in-house (reallocation of labor and work as required, essential overtime). The requested temporary services are for long-term leaves, vacancies, and special studies. 4g) Outside Lab Services $ 0.2 $ 0.2 $ 0.2 The District contracts out certain laboratory services that are not cost-efficient to perform in-house. Examples include air quality analyses, oil analyses for transformers and internal combustion engines, contaminants of potential concern, and hi-resolution mass spectroscopy. Contracted biosolids testing meets the State of Arizona requirement for analyses to be performed in an Arizona certified laboratory. 4h) Contracted Services, Other $ 1.7 $ 1.7 $ 1.8 Over 95% of contracted services are in support of operating and maintaining the collection system and the treatment plants. These services include line cleaning ($405K), closed circuit television of lines ($450K), manhole frame and cover rehabilitation and replacement ($250K), manhole structural repair and coating ($350K), sewer repair and relining ($230K), tunnel cleaning, root and pest control ($80K), and traffic control ($105K). 5 2014-15 AND 2015-16 BUDGET DEVELOPMENT — ADDITIONAL DETAIL Projected Proposed Proposed 2013-14 2014-15 2015-16 5) REPAIRS AND MAINTENANCE $ 9.2 $ 12.2 $ 12.5 5a) Materials & Services $ 7.7 $ 10.2 $ 10.7 Over 98% of these budgets support the maintenance of the collection system and the treatment plants. 0&M contracted materials and services for FY 2014-15 include: Central Generation Overhaul ($1.8 M), digester cleaning ($1.5 M); Carbon media replacement ($779K); process area painting preventive maintenance ($689K); Relay Setting Project ($355K); Interplant line inspection and maintenance ($175K); Central Generation generator rehabilitation ($130 K); and other maintenance services and operating materials, including street overlays/manhole cover raisings and replacements, warehouse stock. The increases following FY 2013-14 are attributed to items previously deferred being addressed in FY 2014-15 and FY 2015-16. The budget for basic scheduled, predictive, and preventive maintenance and emergency maintenance are included in these budgets which are proposed based on historical experience and cost trends. 5b) Service Agreements $ 1.7 $ 2.1 $ 2.1 Approximately 90% of service contracts are computer-related or O&M/FSSD maintenance-related. Major contracts for Information Technology include JDE- Primavera-Oracle support ($315K); copy center services ($275K); Reprographics ($250K); Microsoft License Agreements ($200K); IBM Software Maintenance for Maximo and FileNet-AS ($130K); and various smaller service agreements. 0&M/FSSD service contracts include Fleet Services area subsurface remediation ($150K); Excel Door and Gateway ($124K); Preventative maintenance on Uninterruptible Power Supply electrical maintenance systems ($100K), Central Generation Emissions Monitoring ($52K); and various other plant maintenance agreements. Additional service maintenance agreements covering various equipment items are budgeted throughout the District. 6) UTILITIES $ 6.7 $ 7.1 $ 7.4 6a) Power $ 5.2 $ 5.8 $ 6.0 Electricity—The treatment plants and support buildings estimated consumption and resulting costs for electrical energy purchased from Southern California Edison for the 2014-15 fiscal year are $4,573,000 and the pump stations budget for the same period is $602,200. Other support buildings power costs are $625,000, completing the total estimated power costs for FY 2014-15. 6b) Water $ 0.9 $ 0.6 $ 0.7 Green Acres Project (Gap) Water— GAP water is made up of secondary treated effluent from the District that is further treated by the Orange County Water District. 6 2014-15 AND 2015-16 BUDGET DEVELOPMENT — ADDITIONAL DETAIL Projected Proposed Proposed 2013-14 2014-15 2015-16 GAP water is significantly less expensive than potable water and is used in the process wherever possible. The major uses of GAP water include cooling water, solids handling, and landscaping. A project allowing the use of strained plant water at Plant 1 has significantly reduced the costs. The proposed budgets for FY 2014-15 and FY 2015-16 are $148,000 and $154,000, respectively. GAP water is used when available; for most of the year, Ground Water Replenishment System water is used at both treatment plants. Potable Water—The potable water budget includes the water supplied by the City of Fountain Valley for Plant No. 1 and the City of Huntington Beach for Plant No. 2. Approximately 5% of the potable water at Plant No. 1 is used for domestic uses and less than 1% is used for irrigation. The majority of the irrigation at both plants uses reclaimed water. Less than 1 percent of the potable water used at Plant No. 2 is for domestic uses due to the relatively small number of employees at Plant No. 2. The proposed total potable water cost for FY 2014-15 is $478,000. 6c) Natural Gas $ 0.4 $ 0.4 $0.6 Natural Gas —The total FY 2014-15 natural gas estimate is $365,000, slightly lower than the FY 2013-14 projected as there was no new air quality permit requirements. The natural gas used for Central Generation is purchased from a gas marketer, Constellation Energy, and transported through The Gas Company conveyance system at stipulated cost of $0.11/therm. The"core subscription" is natural gas purchased directly from The Gas Company and used mainly for building heating and supplemental process heating. The Core gas at Plant 2 has decreased considerably with the return of the auxiliary boilers from natural gas to digester gas. The previous switch to natural gas had been made to provide more digester gas to CenGen to support two engines and still comply with the AQMD limits for use of natural gas. 7) PROFESSIONAL SERVICES $ 2.7 $ 2.9 $ 3.0 7a) Legal Services ($784K) Legal services are services primarily provided by General Counsel including hours at the District, hours attending committee and board meetings, and general legal support. Other specialized firms are also included in this budgeted amount. 7b) Engineering Services ($563K) These services provide technical support that in-house staff cannot provide or do not have the time to provide. In FY 2014-15 requested engineering services include a Arch Structural ($270K); Arc flash analysis for electrical systems at both plants ($150K); Biofilter Operation and Compliance ($65K); and miscellaneous studies and evaluations ($78K). 7 2014-15 AND 2015-16 BUDGET DEVELOPMENT — ADDITIONAL DETAIL Projected Proposed Proposed 2013-14 2014-15 2015-16 7c) Advocacy Efforts ($166K) These are consultant services for promoting the District's interests in Sacramento and Washington D.0 concerning legislation and funding. 7d) Audit and Accounting ($199K) These services represent the cost for the District's independent annual financial audit and contracted internal auditing services. 7e) Software Program Consultant ($372K) These support costs are required to supplement programming staff as new software versions and new programs are implemented and revised; they are also in support of the SCADA/ (supervisory control and data acquisition) system for process monitoring and controlling. 7f) Other ($816K) Professional services also includes: Labor Negotiation Services ($105K); an environmental science consultant ($62K); and industrial hygiene services ($44K). Collectively reported within the one line item "Other" are various smaller services including: Dig Alert tickets; website support; photography; coaching and other small professional service expenses. 8) OTHER OPERATING SUPPLIES $ 2.2 $ 2.3 $ 2.4 8a) Prop. and General Liability Insurance ($1.0M) The District's outside excess general liability insurance coverage is $30 million with a self- insurance retention of$250,000. The District's property insurance coverage of$1 billion for perils other than flood and $300 million for flood is subject to a self-insurance retention of$250,000. The District is self-insured for all property damage from the perils of earthquake. The proposed appropriation of$1.0 million is needed to maintain the recommended level of reserve within the general liability and property self-insurance fund. 8b) Regulatory Operating Fees ($792K) Payments to the Regional Water Quality Control Board for the NPDES Permit and to the South Coast Air Quality Management District for permit fees. 8c) Other ($408K) 8 2014-15 AND 2015-16 BUDGET DEVELOPMENT — ADDITIONAL DETAIL Projected Proposed Proposed 2013-14 2014-15 2015-16 Other material, supplies, and services collectively reported within this one line item. 9) ADMINISTRATIVE EXPENSE $ 1.2 $ 1.3 $ 1.4 9a) Small Computer Items ($511K) New Computers/Notebooks/Tablets, printers, monitors, Networking equipment, Computer peripherals, Digital equipment, PDAs, Digital Cameras, etc. 9b) Memberships ($536K) OCSD's largest membership costs are for District-wide participation in groups such as the National Association of Clean Water, the Orange County Business Council, the California Association of Sanitation Agencies, the Southern California Alliance of Publicly Owned Treatment Works, the Association of California Water Agencies, and the Center for Demographic Research. A minor portion of these expenses is for staff memberships in professional associations. 9c) Office Supplies ($63K) Office supplies include such items as envelopes, letterhead, notebooks, calendars, etc. 9d) Other ($190K) Other smaller administrative expenses collectively reported within this one line item. 10) RESEARCH AND MONITORING $ 0.7 $ 0.7 $ 0.7 10a) Environmental Monitoring ($286K) The budget line item for"Environmental Monitoring" includes costs associated with the District's National Pollution Discharge Elimination System (or NPDES) permit-required ocean monitoring program. Regional Monitoring occurs every 4-5 years and samples the coastal ocean from Point Conception in the north to the US-Mexico Border in the south. This is a cooperative, multi-agency effort; most recently, it included 65 other agencies and organizations. In addition to the funds needed to conduct the permit-required ocean monitoring program, Environmental Monitoring also includes operating funds and insurance fees for the District's ocean monitoring vessel, the MIN Nerissa. 10b)Air Quality Monitoring ($71K) Periodic monitoring and analysis of air emissions requires testing from various sources including the central generation facilities, validation of emissions from continuous monitoring equipment, source testing after CIP installation/modification (i.e. P1 trickling 9 2014-15 AND 2015-16 BUDGET DEVELOPMENT — ADDITIONAL DETAIL Projected Proposed Proposed 2013-14 2014-15 2015-16 filters, P1 primary basin install and modifications, etc.). Periodically, there is a requirement to test the waste gas flares. 10c) Other Research ($340K) OCSD contributes annually to research organizations such as the Southern California Coastal Water Research Project and the Water Environmental Research Foundation. 11) OTHER NON-OPERATING EXPENSE $ 0.1 $ 1.0 $ 1.0 11a) General Manager Contingency ($600K) These funds are centrally budgeted and expended through the direct discretion and specific approval of the General Manager to support unanticipated District needs or requests of the Board. 11 b)Prior year Appropriations ($400K) Since the operating budget lapses at the end of each fiscal year, funds need to be set aside for contacts, purchases, commitments, and other legal obligations that have been incurred prior to June 30 in the prior year but goods or services have not been delivered until after June 30 in the new budget year. 12) TRAINING AND MEETINGS $ 0.7 $ 0.8 $ 0.8 12a)Training ($662K) An amount equal to approximately 1.5 percent of the Regular Salaries budget is allocated to Training. Training activities are coordinated though the Human Resources Division. This category includes ongoing technical and safety training and materials for staff; expansion of the Leadership Academy training program, required training for computerized plant monitoring and control systems and training to allow for a more adaptive and flexible work force. 12b) Meetings ($138K) The General Manager has reviewed all meeting request budgets for necessity, duplication, and redundancy and has limited this amount to a responsible level. 13) PRINTING AND PUBLISHING $ 0.3 $ 0.3 $ 0.3 13a) In-House Publishing ($285K) 10 2014-15 AND 2015-16 BUDGET DEVELOPMENT — ADDITIONAL DETAIL Projected Proposed Proposed 2013-14 2014-15 2015-16 Although the budget provides for some outside reproduction, the majority of OCSD printing activities are completed In-house, reflecting an expanded management information system and administrative requirements. As well as continuing demand by the public and regulatory agencies for information. These activities including printing of District's maps, brochures, Board reports and agenda items, budget materials, etc. 13b)Other ($15K) Other printing and publishing expenses collectively reported within this one line item. 14) COST ALLOCATION ($13.9) ($14.7) ($15.3) This represents direct and indirect labor, benefits, materials, and services charged to the Capital Improvement Program (CIP)where the related work was performed. 11 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 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 U.S. Environmental Protection Agency FOG Fats, Oils, and Grease FSSD Facilities Support Services Department gpd Gallons per day GWR System Groundwater Replenishment System (also called GWRS) 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 and Maintenance OCCOG Orange County Council of Governments OCHCA Orange County Health Care Agency OCSD Orange County Sanitation District OCWD Orange County Water District COBS Ocean Outfall Booster Station OSHA Occupational Safety and Health Administration POTW Publicly Owned Treatment Works ppm Parts per million RFP Request For Proposal RWQCB Regional Water Quality Control Board SARFPA Santa Ana River Flood Protection Agency SARI Santa Ana River Inceptor SARWQCB Santa Ana Regional Water Quality Control Board Glossary of Terms and Abbreviations SAWPA Santa Ana Watershed Project Authority SCADA Supervisory Control and Data Acquisition system SCAP Southern California Alliance of Publicly Owned Treatment Works SCAQMD South Coast Air Quality Management District SOCWA South Orange County Wastewater Authority SSMP Sanitary Sewer 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 Research Foundation 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 know 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. 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 farm land or further processed as an earth-like product for commercial and home gardens to improve and maintain fertile soil and stimulate plant growth. Capital Improvement Program (CIP) — Projects for repair, rehabilitation, and replacement of assets. Also includes treatment improvements, additional capacity, and projects for the support facilities. Collform 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. Glossary of Terms and Abbreviations Dilution to Threshold (D/T) - the dilution at which the majority of the people detect the odor becomes the D/T for that air sample. Greenhouse gases - 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 (GWR) System - 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 a day of drinking quality water to replenish the local groundwater supply. Levels of Service (LOS)-Goals to support environmental and public expectations for performance. NDMA- N-Nitrosodimethylamine is an N-nitrosoamine 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 (NACWA) and Water Environment Federation (WEF), with advisory support from the U.S. Environmental Protection Agency (EPA). NBP is committed to developing and advancing environmentally sound and sustainable biosolids management practices that go beyond regulatory compliance and promote public participation in order 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. Publicly-owned Treatment Works (POTW)- Municipal wastewater treatment plant. Santa Ana River Interceptor (SARI) Line - A regional brine line designed to convey 30 million gallons per day (MGD) 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 run-off. 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. Glossary of Terms and Abbreviations Watershed —A land area from which water drains to a particular water body. OCSD's service area is in the Santa Ana River Watershed.