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
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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.
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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
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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
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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.
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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.
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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%)
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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
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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.
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CEQA
N/A
BUDGET/DELEGATION OF AUTHORITY COMPLIANCE
N/A
ATTACHMENT
N/A
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