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HomeMy WebLinkAbout05-08-2013 Admin Agenda Online Wednesday, May 8, 2013 5:30 P.M. Orange County Sanitation District Administration Building Regular Meeting of the Board Room Administration Committee 10844 Ellis Avenue 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 April 10, 2013 Administration Committee Meeting. ACTION ITEMS: 2. Recommend to the Board of Directors to: Approve the 2013-14 "not-to-exceed" quotes for the follow insurances: A. Excess General Liability Insurance — Not to Execeed $372,000 B. Excess Workers' Compensation — Not to Exceed $200,000 C. All-Risk Property, Flood and Boiler & Machinery insurance — Not to Exceed $750,000 3. Recommend to the Board of Directors to: Authorize an additional amount of $275,000 to Project No. SP-103, Specification No. CS-2012-518BD-R, increasing the total amount to not to exceed to $525,000 for completion of the Piping and Instrumentation Diagrams (P&IDs). 05/oa/13 Adainistation Committee Agenda Page 1 d 2 4. A. Approve a Purchase Order contract with Strategic Hardware, for the purchase of the Backup Deduplication/Replication Appliance, Specification No. E-2012-554-R, for an amount not to exceed $152,917 and; B. Approve a contingency in the amount of$7,646 (5%). INFORMATION ONLY 5. Worker's Compensation Update 6. Retirement Program Update 7. Budget Update (no attachment) OTHER BUSINESS AND COMMUNICATIONS OR SUPPLEMENTAL AGENDA ITEMS, IF ANY: ADJOURNMENT: The next Administration Committee meeting is scheduled for Wednesday, June 12, 2013, at 5:30 p.m. Accommodations for the Disabled: Meefing 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 majonty 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. Maria E.Ayala Clerk of the Board (714)593-7130 mavala/glocsd.com For any questions on the agenda,Committee members may contact staff at: General Manager James Herberg (714)593-7110 iherberg(a)ocsd.com Assistant General Manager Bob Ghirelli (714)593-7400 rohirelli0ocsd.com Director of Finance and Lorenzo Tyner (714)593-7550 Itwer(cDomd.com Administrative Services Director of Human Resources Jeff Reed (714)593-7144 ireeclaocsd.com 05/0e/13 Administration Committee Agenda Page 2 of 2 RETURN TO AGENDA REPORT ADMINISTRATION COMMITTEE Meeting Date To ad.of Dir. 05/09/13 05/22/13 AGENDA REPORT Rem Number Item Number z Orange County Sanitation District FROM: James D. Herberg, General Manager Originator: Lorenzo Tyner, Director of Finance and Administrative Services SUBJECT: STATUS OF 2013-14 INSURANCE RENEWALS GENERAL MANAGER'S RECOMMENDATION Approve the 2013-14 "not-to-exceed" quotes for the follow insurances: A. Excess General Liability Insurance — Not to Execeed $372,000 B. Excess Workers' Compensation — Not to Exceed $200,000 C. All-Risk Property, Flood and Boiler & Machinery insurance — Not to Exceed $750,000 SUMMARY The Risk Management Division and the Sanitation District's operational insurance broker (Alliant) began the renewal process in January and provided the Administration Committee preliminary quotes in March. This report includes the most recent quotes. The Sanitation District's insurance broker will be at the May Administration Committee meeting to answer any questions regarding these "not-to-exceed" quotes. The Sanitation District budget provides funds for the renewal of the following three major insurances for the operations: 1) Excess General Liability Insurance 2) Excess Workers' Compensation 3) All-Risk Property, Flood and Boiler & Machinery insurance PRIOR COMMITTEE/BOARD ACTIONS May 2012 - The Board approved renewal of the above four policies for the period July 1, 2012 through June 30, 2013. 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 Page 1 of 3 RETURN TO AGENDA REPORT sister program, the Alliant National Municipal Liability Program (ANML). The Sanitation District has participated in the CAMEL program since FY 1996-97. 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. Actual insurance coverage consists of two separate layers. The first layer is the "Basic" $10 million program with self-insured retention of $250,000. The second layer consists of$20 million of coverage in excess of the first layer of$10 million. The 2013-14 premium is estimated not to exceed is $372,000, approximately 4% over the prior year. 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 $250,000, 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 if even there were a surcharge, the cost might still continue to be cheaper. The 2013-14 renewal rate for Excess Workers' Compensation Insurance is estimated not to exceed 0.00315 (a 15% increase) or $200,000 based on estimated payroll. Page 2 of 3 RETURN TO AGENDA REPORT 3) All-Risk Property, Flood Insurance and Boiler & Machinery Insurance The All-Risk Property, Flood and Boiler/Machinery 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 Boiler & Machinery insurance 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 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. Currently, the Sanitation District has earthquake insurance only in connection with some of its buildings under construction. 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 nearly a dozen different layers of 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 2013-14 renewal rate for All-Risk Property, Flood and Boiler Insurance is estimated not to exceed $750,000, a 40% increase over the prior year. This large rate increase is not related to any Sanitation loss history but to a recent change in market conditions as a result of various worldwide loses, specifically related to flooding. Additionally, there is an increase as a result of the new construction that has finished and now needs to be insured. The Sanitation District and its Broker are working to reduce this estimate. CEQA N/A BUDGET/DELEGATION OF AUTHORITY COMPLIANCE N/A Page 3 of 3 RETURN TO AGENDA REPORT ADMINISTRATION COMMITTEE Meeting Date To 3d.of Dir. 05/08/13 05/22/13 AGENDA REPORT em Number Iem Number 3 Orange County Sanitation District FROM: James D. Herberg, General Manager Originator: Lorenzo Tyner, Director of Finance and Administrative Services SUBJECT: AUTHORIZE AN INCREASE TO PROJECT NO. SP-103, SPECIFICATION NO. CS-2012-518BD-R, FOR THE PIPING AND INSTRUMENTATION DIAGRAMS, REDRAW GENERAL MANAGER'S RECOMMENDATION Authorize an additional amount of$275,000 to Project No. SP-103, Specification No. CS- 2012-518BD-R, increasing the total not to exceed amount to $525,000 for completion of the Piping and Instrumentation Diagrams (P&IDs). SUMMARY On May 23, 2012, the Orange County Sanitation District ("District") entered into Agreements to redraw approximately 850 obsolete P&IDs. These drawings are used by Operations & Maintenance staff to provide process control strategies and troubleshoot process issues, and by the Engineering staff for project design. In order to determine the overall level of effort and cost to complete this project, the effort was separated into two phases. The initial phase (850 drawings) was for only those drawings related one portion of the treatment plants. Based on the drawings that have been completed during this initial effort, staff has determined the efficacy of the effort and the average cost ($300/drawing). Staff has identified a final 915 drawings that require conversion. At the end of this contract, all obsolete drawings will be converted. PRIOR COMMITTEE/BOARD ACTIONS May 2012 —Awarded a Professional Agreement Contract to TDI Consulting and Brown & Caldwell for P&ID Redrawing Project, Specification No. CS-2012-518BD-R with an aggregate amount not to exceed $250,000 ADDITIONAL INFORMATION From 1995 until July 2010, the District's engineering standard for Computer Assisted Design (CAD) was Intergraph's Plant Design System (PDS) and was used to create and manage approximately 1,200 P&ID drawings. The District's PDS software is obsolete and unsupported. Since July 2010, the District's engineering CAD standard is now AutoCAD, a more mainstream industry standard. All existing P&ID drawings are being Page 1 of 2 RETURN TO AGENDA REPORT converted to the new AutoCAD standard. This includes some long-standing Capital Improvement Projects that are delivering P&IDs using PDS per the standard that was in place at the time of the contract. CEQA N/A BUDGET/DELEGATION OF AUTHORITY COMPLIANCE This request complies with authority levels of the District's Delegation of Authority. This item has been budgeted as SP-103. There is no increase in project budget. Page 2 of 2 ADMINISTRATION COMMITTEE Needng Dare To ad.of Dir. 05,08,13 -- AGENDA REPORT Item Number Item Number a Orange County Sanitation District FROM: James D. Herberg, General Manager Originator: Lorenzo Tyner, Director of Finance and Administrative Services SUBJECT: BACKUP DEDUPLICATION/REPLICATION APPLIANCE GENERAL MANAGER'S RECOMMENDATION A. Approve a Purchase Order contract with Strategic Hardware, for the purchase of the Backup Deduplication/Replication Appliance, Specification No. E-2012-554- R, for an amount not to exceed $152,917 and; B. Approve a contingency in the amount of$7,646 (5%). SUMMARY OCSD currently uses a robotic tape library system that was installed in 2004, to backup computer data. The system has exceeded its anticipated seven year life and is currently obsolete. This procurement replaces the existing system, allows for future data growth, and establishes a disaster recovery location at Plant 2. PRIOR COMMITTEE/BOARD ACTIONS None ADDITIONAL INFORMATION On February 7, 2013, OCSD issued a Request for Proposal (RFP) and on March 5, 2013, three proposals were received from the following vendors: ( GovPlace ( Nth Generation Computing, Inc. ( Strategic Hardware A panel consisting of five OCSD staff members reviewed and ranked each of the proposals in accordance with Resolution No. OCSD 07-04, Section 5.07. This RFP used the consensus scoring method. During consensus scoring sessions, the evaluation facilitator directs the team's attention to each item in the specifications. The evaluation team considers one proposal at a time, comparing the vendor's proposed offering against the specifications in the underlying RFP. Consensus scoring sessions encourage open discussions and questions among members of the evaluation team. Page 1 of 2 Evaluators discuss the relative strengths and weaknesses of a vendor's proposal in each area. The following criteria/weights were used to evaluate the proposals: Implementation Services (10e/%), Qualifications of Firm (15%), Technical Solution (40e/%), and Cost Evaluation (25%). Although they were not the lowest cost proposal, the technical solution proposed by Strategic Hardware was rated much higher than the other proposers based on the type of technology and validated during verification from the provided references. Nth Generation Computing submitted the lowest cost proposal. However, during the evaluation process and discussion with the submitted references, it was determined that they were not the most qualified firm. Some of the submitted references stated that they were not using the same technology required for this project or were not completely satisfied with the outcomes. Therefore, after this assessment, the proposal review panel ranked Strategic Hardware as the most qualified firm. Staff recommends awarding the Purchase Order contract to Strategic Hardware in a not-to-exceed amount of$152,917. PROPOSAL EVALUATION TABLE GovPlace Nth Strategic Generation Hardware Computing Consensus 588.6 675 783 Score Ranking 3 2 1 Proposal Fee $166,722 $109,110 $152,917 CEQA N/A BUDGET/ DELEGATION OF AUTHORITY COMPLIANCE This request complies with authority levels of the Sanitation District's Delegation of Authority. This item has been budgeted per CIP Project SP-163 Date of ADDroval Contract Amount Contingency 05/08/13 $152,917 $7,646(5%) Page 2 of 2 ADMINISTRATION COMMITTEE Needng Dare TO ad.Of Dir. 05,08,13 -- AGENDA REPORT Item Number Item Number s Orange County Sanitation District FROM: James Herberg, General Manager Originator: Lorenzo Tyner, Director of Finance and Administrative Services SUBJECT: WORKER'S COMPENSATION UPDATE GENERAL MANAGER'S RECOMMENDATION Informational only SUMMARY Annually, staff provides the Administration Committee an update regarding Worker's Compensation. The Risk Management Division contracts with a Third Party Administrator, Keenan to provide comprehensive worker's compensation services to the District. The numbers provided below demonstrate the Workers Compensation trends over the past six years. Policy Period Claims Made Total Costs Incurred 2007/2008 45 $633,414 2008/2009 34 $616,323 2009/2010 27 $253,277 2010/2011 26 $149,545 2011/2012 31 $246,704 2012/2013 FYTD 12 $ 90,139 Comparing 2007/2008 to 201112012, the above numbers demonstrate a 31% reduction of claims made and a 61% reduction in total cost incurred. PRIOR COMMITTEE/BOARD ACTIONS N/A Page 1 of 1 ADMINISTRATION COMMITTEE Meeting Date To ad.of D11. 05/08/13 -- AGENDA REPORT Item Number Item Number 6 Orange County Sanitation District FROM: James D. Herberg, General Manager Originator: Jeff Reed, Director of Human Resources SUBJECT: RETIREMENT PROGRAM UPDATE GENERAL MANAGER'S RECOMMENDATION Information only SUMMARY Representatives from the Orange County Employees Retirement System (OCERS) will provide the Board with a comprehensive overview of the Orange County Sanitation District's (OCSD) retirement program. PRIOR COMMITTEE/BOARD ACTIONS N/A ADDITIONAL INFORMATION Regular full-time and part-time employees participate in the Orange County Employees Retirement System (OCERS), which is governed by the County Employees Retirement Law (CERL). OCSD pays an employer contribution rate which is determined annually by OCERS. The FY 2012-2013 employer contribution rates range from 24.89% to 27.47%, based on retirement formula. OCERS projects a rate increase effective July 1, 2013, and will present on the anticipated costs and assumptions. Active OCERS members (employees) contribute to the plan via employee contributions, ranging from 5.54% to 14.51%, based on age and retirement formula. The average employee contribution rate is 11.37% Most current employees were hired in under Plan H; providing a benefit of 2.5% at 55; and the employer contributes 3.5% toward the employee's contribution. A second tier retirement formula was negotiated with all OCSD labor groups. Thereafter, all new hires were subject to the second tier retirement formula (Plan B), which provides a benefit of 1.667% at 57.5. The third tier retirement formula (Plan U) was implemented per the Public Employee Pension Reform Act (PEPRA) on January 1, 2013, which provides a benefit of 2% at 62. Employees pay the full employee contribution rate for Plans B and U; there is no employer pick up of any portion of the employee contribution rate. Page 1 of 2 CEQA N/A BUDGET/DELEGATION OF AUTHORITY COMPLIANCE N/A ATTACHMENT N/A Page 2 of 2