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HomeMy WebLinkAbout04-13-2016 Administration Committee Agenda Orange County Sanitation District Wednesday, April 13, 2016 Regular Meeting of the 5:00 P.M. ADMINISTRATION Administration Building COMMITTEE Board Room 10844 Ellis Avenue Fountain Valley, CA 714 593-7433 AGENDA CALL TO ORDER: PLEDGE OF ALLEGIANCE: DECLARATION OF QUORUM: (Clerk of the Board) PUBLIC COMMENTS: If you wish to address the Committee on anyftem,please complete a Speaker's Form (located at the table outside of the Board Room) and submit it to the Clerk of the Board or notify the Clerk of the Board the item number on which you want to speak. Speakers will be recognized by the Chairman and are requested to limit comments to three minutes. REPORTS: The Committee Chair and the General Manager may present verbal reports on miscellaneous matters of general interest to the Committee Members. These reports are for information only and require no action by the Committee. REPORT OF DIRECTOR OF FINANCE AND ADMINISTRATIVE SERVICES: CONSENT CALENDAR: The Consent Calendar Items are considered to be routine and will be enacted, by the Committee, after one motion, without discussion. Any items withdrawn from the Consent Calendar for separate discussion will be conserved in the regular order of business. 1. APPROVAL OF MINUTES (Clerk of the Board) RECOMMENDATION: Approve Minutes of the March 9, 2016, Administration Committee Meeting. 04113116 Administration Commiftee Agenda Page 1 of 4 2. PIPELINE CONDITION ASSESSMENT AND CLOSED CIRCUIT TELEVISION (CCTV) DATA SOFTWARE AND RELATED SERVICES (Lorenzo Tyner) RECOMMENDATION: Recommend to the Board of Directors to: A. Approve a purchase order contract to Innovyze, Inc. for pipeline condition assessment and CCTV data software and related services per Specification No. 5-2015-73513D, for an amount not to exceed $152,800; B. Authorize the purchase of an annual maintenance contract with four (4) annual renewals at $18,000 per year for a total of$72,000; and C. Approve a contingency of $17,080 per renewal period for software and related services for annual maintenance. 3. COOPERATIVE PROCUREMENT WITH U.S. COMMUNITIES GOVERNMENT PURCHASING ALLIANCE (Lorenzo Tyner) RECOMMENDATION: Recommend to the Board of Directors to: Authorize purchases of information technology products, services, and solutions using the County of Fairfax, Virginia contract number #4400006644 with Insight Public Sector available through U.S. Communities Government Purchasing Alliance, for the period May 1, 2016 though, April 30, 2019, for a total amount not to exceed $800,000, in accordance with Ordinance OCSD-47, Section 2.03(B) Cooperative Purchases. 4. CLASSIFICATION & COMPENSATION STUDIES — VENDOR CHANGE (Celia Chandler) A. Award a Professional Consultant Services Agreement with Koff and Associates for the compensation phase of the classification and compensation study, Specification CS-2014-6306D, for a total amount not to exceed $65,040, with a new total amount of phase one and two not to exceed of$126,929; and B. Approve a contingency of$6,504 (10%). NON-CONSENT: 5. DISASTER RECOVERY DATA CENTER FACILITY (Lorenzo Tyner) A. Authorize a sole source agreement with Switch (SUPERNAP)for a disaster recovery data center facility beginning May 13, 2016 through May 12, 2019, for the total amount of$140,000; and 04113/16 AdminiWalion Committee Agenda Page 2 of 4 B. Approve a contingency of $14,000 (10%). INFORMATION ITEMS: 6. STATUS OF 2016.17 PROPERTY-LIABILITY INSURANCE RENEWALS (Celia Chandler) 7. FY 2016-17 AND FY 2017-18 BUDGET UPDATE (Lorenzo Tyner) 8. PRETREATMENT PROGRAM OVERVIEW (Bob Ghirelli) CLOSED SESSION: None. OTHER BUSINESS AND COMMUNICATIONS OR SUPPLEMENTAL AGENDA ITEMS, IF ANY: ADJOURNMENT: The next Administration Committee meeting is scheduled for Wednesday, May 11, 2016 at 5:00 p.m. 04/13/16 Administration Committee Agenda Page 3 of 4 Accommodations for the Disabled: Meeting Rooms are wheelchair accessible. If you require any special disability related accommodations, please contact the Orange County Sanitation District Clerk of the Board's office at (714)593-7433 at least 72 hours prior to the scheduled meeting. Requests must specify the nature of the disability and the type of accommodation requested. Agenda Posting: In accordance with the requirements of California Government Code Section 54954.2,this agenda has been posted outside the main gate of the Sanitation District's Administration Building located at 10844 Ellis Avenue, Fountain Valley, California, not less than 72 hours prior to the meeting date and time above. All public records relating to each agenda item,including any public records distributed less than 72 hours prior to the meeting to all,or a majority of the Board of Directors,are available for public inspection in the office of the Clerk of the Board. Agenda Description: The agenda provides a brief general description of each item of business to be considered or discussed. The recommended action does not indicate what action will be taken. The Board of Directors may take any action which is deemed appropriate. NOTICE TO DIRECTORS: To place items on the agenda for the Committee Meeting, items must be submitted to the Clerk of the Board 14 days before the meeting. Kelly A.Lore Clerk of the Board (714)593-7433 kloreGQocsd.com For any questions on the agenda,Committee members may contact staff at: General Manager James Herberg (714)593-7300 iherberc(Wocsd.com Assistant General Manager Bob Ghirelli (714)593-7400 rehirelliOZocsd.com Director of Finance and Lorenzo Tyner (714)593-7550 Itvner&Docsd.com Administrative Services Director of Human Resources Celia Chandler 714 593-7202 cchandler ocsd.com 04/13/16 Administration Committee Agenda Page 4 of 4 ITEM NO. 1 MINUTES OF THE ADMINISTRATION COMMITTEE Orange County Sanitation District Wednesday, March 9, 2016, at 5:00 P.M. A regular meeting of the Administration Committee of the Orange County Sanitation District was called to order by Committee Chair Curry on March 9, 2016, at 5:01 p.m., in the Administration Building of the Orange County Sanitation District. Director Katapodis led the Flag Salute. A quorum was declared present, as follows: COMMITTEE MEMBERS PRESENT: STAFF PRESENT: Keith Curry, Chair Jim Herberg, General Manager Lucille Kring, Vice-Chair Bob Ghirelli, Assistant General Manager Steven Choi Celia Chandler, Director of Human Resources Jim Ferryman Rob Thompson, Director of Engineering Jim Katapodis Lorenzo Tyner, Director of Finance & Peter Kim Administrative Services Greg Mills Ed Torres, Director of Operations & Maintenance Joy Neugebauer Mike White, Controller Teresa Smith Tina Knapp, Deputy Clerk of the Board Sal Tinajero Norbert Gaia John Nielsen, Board Chair Mark Manzo Greg Seboum, Board Vice-Chair Alfredo Garcia Gary Conklin COMMITTEE MEMBERS ABSENT: Jim Mullins Glenn Parker Jennifer Cabral OTHERS PRESENT: Kendra Carney, Associate General Counsel PUBLIC COMMENTS: None. REPORT OF COMMITTEE CHAIR: Committee Chair Curry did not provide a report. REPORT OF GENERAL MANAGER: General Manager Jim Herberg commented on a recent article in the "Los Angeles Times' regarding antibiotic resistant bacteria in wastewater treatment plants. He stated the 03/09/16 Administration Committee Minutes Page 1 of 5 article referenced treatment facilities in Southern California, ocean dischargers, and unpublished work by the EPA which OCSD has not seen the detailed reports and no sampling and/or testing has shown this bacteria in OCSD's effluent. General Manager Herberg further stated that the article seems to confuse the issue of urban run-off after a rainstorm vs. treated discharge and he indicated that he had spoken with the City of Los Angeles and Los Angeles County Sanitation Districts and there is interest in putting together a letter to the editor style response to the article. General Manager Herberg responded to questions from the Committee regarding: location of bacteria, specific testing; and epidemiological studies and tests of the ocean and shoreline which continually achieve the required standards. Mr. Herberg further indicated that OCSD is confident that the bacteria could not withstand the treatment of that the Orange County Water District performs; rather, the matter seems to be related to the ocean and treatment facilities. Director Teresa Smith arrived at 5:04 p.m. REPORT OF DIRECTOR OF FINANCE AND ADMINISTRATIVE SERVICES: Director of Finance and Administrative Services Lorenzo Tyner reported that the debt refunding that was approved by the Committee last month was recently priced and will result in savings to OCSD totaling $19 million dollars. CONSENT CALENDAR: 1. APPROVAL OF MINUTES (Clerk of the Board) MOVED, SECONDED AND DULY CARRIED TO: Approve Corrected Minutes of the February 10, 2016 Administration Committee Meeting. AYES: Choi, Curry, Ferryman, Katapodis, Kim, Kring, Mills, Neugebauer, Nielsen, and T. Smith NOES: None ABSTENTIONS: None ABSENT: Parker, Sebourn, and Tinajero 2. APPOINTING A CLERK OF THE BOARD PRO TEM TO THE BOARD OF DIRECTORS IN THE ABSENCE OF THE CLERK OF THE BOARD (Clerk of the Board) MOVED, SECONDED AND DULY CARRIED TO: Recommend to the Board of Directors to: Adopt Resolution No. OCSD 16-XX entitled, "A Resolution of the Board of Directors of Orange County Sanitation District appointing a Clerk of the Board Pro Tem to the Board of Directors; and repealing Resolution No. OCSD 07-23." 03/09/16 Adminishation Committee Minutes Page 2 of 5 AYES: Choi, Curry, Ferryman, Katapodis, Kim, Kring, Mills, Neugebauer, Nielsen, and T. Smith NOES: None ABSTENTIONS: None ABSENT: Parker, Sebourn, and Tinajero 3. REPORT OF THE INVESTMENT TRANSACTIONS FOR THE MONTH OF FEBRUARY 2016 (Lorenzo Tyner) MOVED, SECONDED AND DULY CARRIED TO: Recommend to the Board of Directors to: Receive and file the report of the investment transactions for the month of February 2016. AYES: Choi, Curry, Ferryman, Katapodis, Kring, Mills, Neugebauer, Nielsen, and T. Smith NOES: None ABSTENTIONS: Kim ABSENT: Parker, Sebourn, and Tinajero 4. DESIGNATION OF APPLICANT'S AGENT FOR DISASTER RELIEF (Bob Ghirelli) MOVED, SECONDED AND DULY CARRIED TO: Recommend to the Board of Directors to: Adopt Resolution No. OCSD 16-XX, entitled, "A Resolution of the Board of Directors of the Orange County Sanitation District authorizing the General Manager or Designee to Execute State Office of Emergency Services and/or Federal Emergency Management Agency Documents and Relevant Permit Applications for Present and Future Disaster Relief Applications; and Repealing Resolution No. OCSD 11-03" AYES: Choi, Curry, Ferryman, Katapodis, Kim, Kring, Mills, Neugebauer, Nielsen, and T. Smith NOES: None ABSTENTIONS: None ABSENT: Parker, Sebourn, and Tinajero INFORMATION ITEMS: 5. FY 2016-17 AND 2017-18 BUDGET UPDATE (Lorenzo Tyner) Director of Finance and Administrative Services Lorenzo Tyner introduced Mike White, Controller, who provided a PowerPoint presentation and an update on the FY 2016-17 and 2017-18 budget including the four major categories that compose revenues: fees&charges, general income, other/interagency, and debt proceeds. 03/09/16 Adminishation Committee Minutes Page 3 of 5 Mr. White responded to questions regarding: the definition of near term, debt issuances; property values increases; new developments increase capacity needs; and capital facilities capacity charges. Mr. White indicated that interest revenue is difficult to project; however, Mr. Tyner stated that this is of benefit as OCSD can borrow money more inexpensively as well. 6. ENVIRONMENTAL SERVICES DEPARTMENT OVERVIEW (Bob Ghirelli) Assistant General Manager Bob Ghirelli provided a PowerPoint presentation and an overview of the Environmental Services Department. Mr. Ghirelli distributed the recruitment flyer for the new Director of Environmental Services. Director of Human Resources Celia Chandler stated a recruitment firm was not used for this position due to sufficient resources and extensive advertising done, which is resulting in a good number of qualified applicants. Staff confirmed that the salary being offered for this role is very competitive and that the creation of this position resulted from a recent retirement in a management position, so is a reallocation of that vacancy and will not increase the management staff count. Board Vice-Chair Seboum arrived at 5:18 p.m. 7. ENERGY EFFICIENCY AUDIT FINDINGS (Ed Torres) Director of Operations Ed Torres introduced Senior Engineer Gary Conklin who provided an informative PowerPoint presentation and report of the energy efficiency audit findings. Director of Engineering Rob Thompson responded to questions regarding the cost of replacing, and the advantages of LED lights and how it affects worker safety, indicating that the LED light is whiter, more pleasant, and allows more clarity In response to a question, Director of Operations & Maintenance Ed Torres indicated that OCSD produces approximately 2/3 of the power required to run the plant from the internal combustion engines that are generated from the solids that are digested and turned into methane gas. He stated that the District continually reviews current operations to be efficient as possible. Director Tinajero arrived at 5:47 p.m. CLOSED SESSION: None. 03/09/16 Adminishation Committee Minutes Page 4 of 5 OTHER BUSINESS AND COMMUNICATIONS OR SUPPLEMENTAL AGENDA ITEMS, IF ANY: Director of Finance and Administrative Services Lorenzo Tyner indicated that during the recent debt issuance, OCSD's 'AAA' Credit Rating was reaffirmed by both Fitch Ratings and Standards & Poor's which will allow OCSD to secure very attractive financing for infrastructure improvements, reducing costs, and help to keep fees low. ADJOURNMENT: Committee Chair Curry declared the meeting adjourned at 5:51 p.m. to the next regularly scheduled meeting of Wednesday, April 13, 2016 at 5:00 p.m. Submitted by: Tina Knapp Deputy Clerk of the Board 03/09/16 Adminishation Committee Minutes Page 5 of 5 ADMINISTRATION COMMITTEE Meeting Date TOBd.of Dir. 04/13/16 04/27/16 AGENDA REPORT IWm Number Item Number z Orange County Sanitation District FROM: James D. Herberg, General Manager Originator: Lorenzo Tyner, Director of Finance and Administrative Services SUBJECT: PIPELINE CONDITION ASSESSMENT AND CLOSED CIRCUIT TELEVISION (CCTV) DATA SOFTWARE AND RELATED SERVICES GENERAL MANAGER'S RECOMMENDATION A. Approve a purchase order contract to Innovyze, Inc. for pipeline condition assessment and CCTV data software and related services per Specification No. S-2015-73513D, for an amount not to exceed $152,800; B. Authorize the purchase of an annual maintenance contract with four (4) annual renewals at $18,000 per year for a total of$72,000; and C. Approve a contingency of $17,080 per renewal period for software and related services for annual maintenance. SUMMARY BACKGROUND The existing pipeline assessment data management program was developed in- house and has reached the end of its useful lifespan. Orange County Sanitation District (OCSD) requires a replacement solution to effectively load, store, organize, analyze, and edit digital sewer condition assessment data. The primary purposes of the condition assessment program are to identify issues needing immediate repair or maintenance, and to provide condition assessments in support of long-term capital planning. RELEVANT STANDARDS • Data-driven asset intervention — Type, life data, inspections, costs, industry standards • Investment proposals and decisions based on clearly defined standards PROBLEM The existing pipeline assessment data management system has reached the end of its useful lifespan preventing OCSD staff to load any new condition assessment information into the existing system. The existing system cannot handle newer assessment technologies. Page 1 of 2 PROPOSED SOLUTION Procure software and professional services to include: • Implementation services including all personnel, equipment, and resources necessary to supply, install and configure a Pipeline Assessment Data Management Software System • Integration with OCSD's Geographic Information System (GIS) • Provide comprehensive training and support for the new software system. TIMING CONCERNS The existing system became obsolete in March 2015 because of its limited storage. Deployment of a new solution is imperative to support maintenance initiatives and long-term capital planning. RAMIFICATIONS OF NOT TAKING ACTION Increased risk to OCSD. Knowing and managing the structural conditions of assets will allow OCSD to avoid emergencies, prioritize repair and replacement projects, and plan for the future. Without a proper solution to manage condition assessment information decreases the ability to make sound judgements regarding asset management. PRIOR COMMITTEE/BOARD ACTIONS N/A FINANCIAL CONSIDERATIONS This request complies with authority levels of the Sanitation District's Purchasing Ordinance. This item has been budgeted. ATTACHMENT The following attachment(s)may be viewed on-line at the OCSD website(www.ocsd.com) with the complete agenda package: • License Agreement • Maintenance Agreement • License and Maintenance Agreement Addendum Page 2 of 2 IMPORTANT—READ THE FOLLOWING SOFTWARE LICENSE AGREEMENT BEFORE USING THE ENCLOSED SOFTWARE. This is a legal agreement between Orange County Sanitation District , hereinafter "Licensee' and, Innovyze, Inc., a California corporation, (hereinafter collectively referred to as"Innovyze"). By installing the software, Licensee agrees and accepts to be bound by the terms and conditions of this Agreement. If you do not agree with the terms and conditions of this Agreement, promptly return the software and accompanying written materials and hardware to receive a refund. 1. Definitions. a. "Quotation'shall mean the quotation provided by Innovyze and approved by Licensee,which sets forth the software purchased, licensing and maintenance fees, any other fees or costs, and applicable duties or taxes. b. "Software" shall mean the software indicated on the Quotation, including any accompanying materials and hardware, in executable, machine readable, format. c. "Open-Source Components"shall mean any open-source, freeware, shareware or other software having similar licensing or distribution models by which it is subject to license agreement or other enforceable requirements or restrictions, including under any GNU General Public License or GNU Library or Lesser Public License,or other license agreement that conforms to a standard definition set by the Open Source Initiative. 2. Contracting Entity. Please refer to http://www.innowze.com/licensing/to determine which legal entity, either Innovyze, Inc. or Innovyze, Ltd., is party to this Agreement with Licensee for the Software described in the Quotation. 3. Grant of License. Innovyze hereby grants Licensee a perpetual, nonexclusive,nontransferable right to use the Software in accordance with the terms and restrictions of this Agreement, provided however, that any rental or short term Software licenses will expire at the end of the time period specified in the relevant Quotation. Unless otherwise agreed, Licensee is solely responsible for the installation of the Software. Innovyze or its duly appointed agents shall have the right at any time to inspect the Licensee's premises or computer network to verify the use of the Software is in accordance with the terms of this Agreement, including the number of licenses and configuration of the Software. Under no circumstances shall Licensee have the right to sublicense use of the Software to any third party. Innovyze provides the Software in two configurations: a. Fixed Seat. A fixed seat license configuration permits the installation and use of the Software on a single computer at any one time. The Software may be uninstalled and reinstalled on a different computer(not to exceed more than four(4) times per month)at the same location so long as the number of fixed seat licenses does not exceed the number purchased. b. Floating Seat A floating seat license configuration is installed on a centrally accessible computer or server(LAN or WAN)and consists of the numbers and combinations(sizes and types)of floating seat licenses purchased. The number of authorized concurrent floating seat licenses indicated on the approved Quotation may not be exceeded at any office location. Software granted as WAN or LAN licenses are limited to the office location or country to which they are issued, respectively.As permitted, licenses of the Software may be checked out to a specific computer for the purpose of operating remotely or for other purposes, and that checked out license will not be available to any other computer until returned.Afloating seat license,once issued, may not be divided into multiple floating seat licenses. Licensee must take reasonable steps to ensure that the number of users of the Software at any one time does not exceed the number of licenses for the Software that you have obtained from Innovyze. 4. Open-Source Licenses. The Software may include Open-Source Components licensed under separate open-source licenses, hyperlinked copies of which can be found in the"About"section of the Software ("Open-Source Licenses"). Any use of the Open-Source Components by the Licensee shall be governed by,and subject to,the terms and conditions of the Open-Source Licenses.On written request to Innovyze, Innovyze shall provide the Licensee with a complete,machine-readable copy of the source code for such Open-Source Components in accordance with the terms of the Open-Source License(s). 5. Restrictions. Licensee agrees not to: (a) decompile, reverse engineer, or disassemble the Software, (b) create any derivative work based in whole or in part on the Software, (c) copy, change, modify, merge, or adapt the Software in any way, (d) sublicense, rent, lease, loan, export, or re-export the Software or otherwise transfer the Software to another person or entity, or (a) remove, obscure, or modify any trademark or copyright notice of Innovyze. Notwithstanding the foregoing, Licensee may make one copy of the Software solely for backup or archival purposes. 6. Updates. From time to time,at its option,Innovyze may change,modify,enhance,or otherwise develop new or updated versions of the Software. Licensee has no right under this Agreement to receive or use such updated versions of the Software, but may obtain such updated versions under the terms and conditions of a separately executed Maintenance and Support Agreement. 7. Payment. Licensee agrees to pay the fees indicated in the approved Quotation within thirty (30)days receipt of an invoice from Innovyze or its authorized representative, subsidiary, or affiliate. Failure to make payment shall be deemed a material breach of this agreement. For Software requiring the use of Dongle, failure to make payment will result in Licensee not receiving the necessary activation code for continued use of the Software after installation. 8. Intellectual Property. Licensee agrees that Innovyze is the sole and exclusive owner of all proprietary rights in and to the Software and any corrections, enhancements, updates, or modifications thereto, including any patent, copyright, trade secret, trademark, or other proprietary rights. The Software is protected under applicable law, including the laws of the United States, the United Kingdom, and applicable international treaties. No right,title or interest in or to the Software is transferred to Licensee under the terms of this Agreement. To the extent that a court of competent jurisdiction determines that Licensee is deemed to have any rights in or to the Software of any enhancements, upgrades, etc.,the Licensee assigns those rights to Innovyze. If the Software residing on the Licensee owned or leased server(s) will be accessed through a web application or any other remote access tool or device, Licensee shall provide such reasonable security,to include passwords,frewalls,and network/hardware security, as may necessary to prevent unauthorized access or damage to the Software and to protect Innovyze's Intellectual Property rights under this Agreement. 9. Reliability of Data. Model configurations, projections and the analysis generated by Software is provided "as is", without any warranty as to accuracy or validity, is intended for planning and decision support purposes only, and is subject to uncertainties that cannot be fully identified or qualified. Forecasts and actual results may materially vary due to events and circumstances that are not reasonably foreseeable, inaccurate or incomplete data provided and used to formulate the projections, or operation and system conditions that are beyond the scope or capability of Software. Innovyze is not responsible for the realization of forecasted conclusions or projections, or identification of matters that might affect actual system operation or conditions as a result of Licensee's use of Software. 10. Limited Warranty. Innovyze warrants that the Software will perform substantially in accordance with the accompanying written materials for a period of ninety (90) days from the date the Software is received. Innovyze's sole liability and Licensee's exclusive remedy under this limited warranty will be, at Innovyze's option, either (a) the return of the purchase price paid for the Software or (b) repair or replacement of the Software. Any replacement Software will be warranted for the remainder of the original warranty period or thirty(30)days,whichever is longer. 2 11. DISCLAIMER. TO THE MAXIMUM EXTENT PERMITTED BY APPLICABLE LAW, INNOVYZE DISCLAIMS ALL OTHER WARRANTIES, EXPRESS OR IMPLIED, INCLUDING BUT NOT LIMITED TO, THE IMPLIED WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE, WITH RESPECT TO THE SOFTWARE AND ACCOMPANYING WRITTEN MATERIALS. INNOVYZE DOES NOT WARRANT, REPRESENT, OR GUARANTEE THAT THE SOFTWARE WILL MEET YOUR REQUIREMENTS, THAT THE OPERATION OF THE SOFTWARE WILL BE UNINTERRUPTED OR ERROR-FREE,THAT THE SOFTWARE WILL OPERATE IN COMBINATION WITH ANY OTHER SOFTWARE, OR THAT DEFECTS OR ERRORS IN THE SOFTWARE WILL BE CORRECTED. FURTHER, INNOVYZE MAKES NO WARRANTY, REPRESENTATION OR GUARANTEEE REGARDING THE USE, OR THE RESULTS OF USE, OF THE SOFTWARE WITH RESPECT TO ITS CORRECTNESS, ACCURACY, RELIABILITY, OR OTHERWISE. NO ORAL OR WRITTEN INFORMATION OR ADVICE GIVEN BY INNOVYZE SHALL CREATE A WARRANTY OR IN ANY WAY INCREASE THE SCOPE OF THE LIMITED WARRANTY. 12. LIMITATION OF LIABILITY. THE PARTIES THEREFORE AGREE THAT IN NO EVENT SHALL INNOVYZE BE LIABLE FOR ANY INCIDENTAL, SPECIAL, INDIRECT, OR CONSEQUENTIAL DAMAGES OF ANY KIND (INCLUDING, BUT NOT LIMITED TO, DAMAGES FOR LOST REVENUE OR PROFIT, BUSINESS INTERRUPTION, LOSS OF BUSINESS INFORMATION, OR OTHER PECUNIARY LOSS)ARISING OUT OF THE USE OR INABILITY TO USE THE SOFTWARE, EVEN IF INNOVYZE HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES AND REGARDLESS OF LEGAL THEORY,WHETHER IN TORT, CONTRACT, OR OTHERWISE. 13. INNOVYZE'S TOTAL AGGREATE LIABILITY ARISING FROM OR RELATED TO THIS AGREEMENT SHALL NOT EXCEED THE AMOUNT PAID BY LICENSEE FOR THE SOFTWARE. IN NO EVENT SHALL INNOVYZE BE LIABLE FOR THE PERFORMANCE OR NON-PEFORMANCE OF ANY THIRD PARTY PRODUCTS, INCLUDING SOFTWARE AND HARDWARE. 14. Export Restrictions. Licensee agrees not to export, re-export, or provide the Software in violation of this Agreement or any applicable law, including but not limited to, any regulations or restrictions of the United States Export Administration, United States Treasury Department, United States Commerce Department, or the United Kingdom Department of Trade and Industry. Any use, duplication, or disclosure of the Software by the United States Government is subject to restrictions set forth in subparagraph (c) (1) (ii) of the Rights of Technical Data and Computer Software clause at DFARS 252.227-7013 or subparagraphs (c)(1) (2)of the Commercial Computer Software—Restricted Rights clause at 48 CFR 52.227-19, as applicable. 15. Third Party Software. Licensee acknowledges that Software may require the use of third party software covered by a separate license agreement, and Innovyze has no responsibility or liability for the functionality of such third party software. 16. Controlling Law. The validity, construction, and performance of this Agreement shall be governed in accordance with the laws of the State of Colorado, USA. The parties agree that any proceeding arising out this Agreement shall be instituted in the State of Colorado, Denver County, USA, and each party irrevocably submits to the jurisdiction of such proceeding and waives any and all objections to jurisdiction and venue that it may have under any other law. 17. Termination. If Licensee fails to comply with any of the terms and conditions of this Agreement, Innovyze may terminate the license granted hereunder without notice. In the event of termination,you must immediately uninstall the Software and return any accompanying materials and hardware and provide written confirmation that Licensee has complied with the terms of this provision. 18. Complete Agreement. This Agreement constitutes the entire agreement between the parties concerning the use of the Software and supersedes all prior or contemporaneous understandings or agreements, whether written or oral. This agreement may not be amended except by a writing signed by an authorized representative of Innovyze. 3 19. Binding Effect and Assignment. The terms of this Agreement shall bind and inure to the benefit of the parties and their respective successors and assigns. Innovyze may assign this Agreement,or any right or obligation hereunder, without the prior written consent of Licensee. 20. Parties in Interest. Nothing in this Agreement, express or implied, is intended to confer on any third party or person any right or remedy under or by reason of this Agreement. 21. Severability. The invalidity or unenforceability of any term of this Agreement shall not affect the other terms, and this Agreement shall be construed in all respects as if any invalid or unenforceable term were omitted. 22. Notice. All notices under this Agreement must be delivered in writing by courier, certified or registered mail,to the other party and will be effective upon receipt or three(3)business days after being deposited in the mail, whichever occurs sooner. 23. Waiver. Any waiver, either express or implied, by either party of any term of this Agreement shall not constitute or be construed as a waiver of any subsequent breach or other default. Attachments: Attachment"A" Quote Attachment "B" Innovize Proposal and Scope of Work 4 SOFTWARE MAINTENANCE 8.SUPPORT AGREEMENT The following Maintenance and Support Agreement (hereinafter "Agreement') is by and between Orange County Sanitation District (hereinafter "Licensee') and Innovyze, Inc.. (as provide in the Innovyze Standard License Agreement and hereinafter collectively "Innovyze") and shall apply to the provision of software maintenance and support services for the Software licensed under the Innovyze Standard License Agreement. If not otherwise defined herein, defined terms shall have the meaning as set forth in the Innovyze Standard License Agreement, which is specifically referenced and incorporated herein. In the event of any conflict in terms,the terms of the Standard License Agreement shall govem. 1. Definitions. "Effective Date" shall mean date set forth in the Quotation approved by Licensee. 7. Late Payment. If you fail to pay the Annual Maintenance Fee within thirty (30) days of the due 2. Term. This Agreement shall commence on the date, this Agreement will automatically terminate Effective Date and shall automatically renew on the without written notice. Failure to make payment will anniversary date of the Effective Datefora twelve(12) result in Licensee receiving no maintenance and month period or such other period as may defined in support services as described herein,including but not the Quotation ("Term"), unless cancelled as set forth limited to, the reactivation of the Software in below. connection with its transfer to another computer or server. If Licensee wishes to renew this Agreement 3. Software Updates and Maintenance. Innovyze will after it has been terminated for non-payment,Licensee support, maintain, update, and upgrade shall pay all Annual Maintenance Fees in arrears plus ("Maintenance') the Software during the Term. a charge of 25%on the total amount. Maintenance will only apply to unmodified Software and the most recently released and updated version of 8. Training. No software training is provided the Software. During the Term, Innovyze will use hereunder. commercially reasonable efforts to correct any functions in the Software which fail to perform as 9. Data. Any data or information provided by specified in the supporting documentation. Updatesor Licensee to assist Innovyze in the provision of upgrades issued by Innovyze for the Software also maintenance services hereunder shall remain your may include enhancements or new features. sole and exclusive property. Innovyze shall have no liability for the accuracy or correctness of such data or 4. Software Support. Licensee may contact the information. Innovyze support team. The contact information can be found at http://www.Innovvze.mm/contactus/. 10. Limitation of Liability.The parties agree,to the Innovyze support staff will be available during normal fullest extent permitted by law, to limit the business hours to assist Licensee regarding the aggregate liability of Innovyze, its parents, operation of the Software within a reasonable time. subsidiaries and affiliates, and their respective directors, officers, employees and agents, to the 5. Cancellation. Either party may elect not to Annual Maintenance Fee as set forth in the automatically renew this Agreement by providing the Quotation. This limitation of liability shall apply to other party a written notification of cancellation at least all suits, claims, actions, losses, costs and sixty (60) days prior to the end of the then current damages of any nature arising from or related to Term. this agreement and without regard to the legal theory underwhich such liability is imposed. 6. Subscription Fees. On the anniversary of the Effective Date, Licensee agree to pay Innovyze the Under no circumstances shall Innovyze be liable Annual Maintenance Fees set forth in the Quotation for any, incidental, special, or consequential and each year thereafter on the anniversary date of damages of any kind (including, but not limited to, Effective Date. Payment shall be made within 30 days damages for loss of revenue or profit, business receipt of invoice. Innovyze reserves the right to interruption, or loss of business information) change the Annual Maintenance Fee, provided that:(i) arising out the provision of services under this any such change in the fee shall not take effect until agreement or the use, or inability to use, the the commencement of the next 12-month Term, and Software,even if Innovyze has been advised of the (it)there will be no more than one change in the Annual possibility of such damages. Maintenance Fee in any 12-month period. 11. Controlling Law. The validity, construction, and performance of this Agreement shall be governed Attachments: in accordance with the laws of the State of Colorado, USA. The parties agree that any proceeding arising Attachment"A"—Quote out this Agreement shall be instituted in the State of Attachment 'B" - Innovize Proposal and Scope of Colorado, Denver County, USA, and each party Work irrevocably submits to the jurisdiction of such proceeding and waives any and all objections to jurisdiction and venue that it may have under any other law. 12. Termination. If Licensee fails to comply with any of the terms and conditions of this Agreement, Innovyze may laminate the license granted hereunder without notice. In the event of termination, you must immediately uninstall the Software and return any accompanying materials and hardware and provide written confirmation that Licensee has complied with the terms of this provision. 13. Complete Agreement. This Agreement constitutes the entire agreement between the parties concerning the use of the Software and supersedes all prior or contemporaneous understandings or agreements, whether written or oral. This agreement may not be amended except by a writing signed by an authorized representative of Innovyze. 14. Binding Effect and Assignment. The terms of this Agreement shall bind and inure to the benefit of the parties and their respective successors and assigns. Innovyze may assign this Agreement,or any right or obligation hereunder, without the prior written consent of Licensee. 15. Parties in Interest. Nothing in this Agreement, express or implied, is intended to confer on any third party or person any right or remedy under or by reason of this Agreement. 16. Severability. The invalidity or unenforceability of any term of this Agreement shall not affect the other terms, and this Agreement shall be construed in all respects as if any invalid or unenforceable term were omitted. 17. Notice.All notices under this Agreement must be delivered hn writing by courier,certified or registered mail, to the other party and will be effective upon receipt or three (3) business days after being deposited in the mail,whichever occurs sooner. 18. Waiver.Any waiver, either express or implied, by either party of any term of this Agreement shall not constitute or be construed as a waiver of any subsequent breach or other default. inno v- SOFTWARE LICENSE AGREEMENT SOFTWARE MAINTENANCE &SUPPORT AGREEMENT ADDENDUM The following Addendum to the Software License Agreement and Software Maintenance & Support Agreement (hereinafter referred to collectively as the "Addendum") is by and between Orange County Sanitation District(hereinafter"Licensee")and Innovyze, Inc.and shall apply to the Software licensed under the Innovyze Software License Agreement and maintained under the Software Maintenance & Support Agreement attached hereto. The Parties agree that Terms&Conditions of the following Agreements are amended as follows: 1. Software Maintenance and Support Agreement, Paragraph 1, is amended in its entirety to read as follows: "Effective Date" shall mean date of the Notice to Proceed issued by Orange County pursuant to the Award of Agreement by Orange County Sanitation District Board of Directors. 2. Software Maintenance and Support Agreement, Paragraph 6, is amended in its entirety to read as follows: Section 6. Subscription Fees. On the anniversary of the Effective Date, Licensee agrees to pay Innovyze the Annual Maintenance Fees set forth in the Quotation and each year thereafter on the anniversary date of Effective Date. Payment shall be made within 30 days of receipt of invoice. Innovyze reserves the right to change the Annual Maintenance Fee, provided that:(i)any such change in the fee shall not take effect until fifth anniversary of the Effective Date, and (ii)there will be no more than one change in the Annual Maintenance Fee in any 12-month period. 3. Software Maintenance and Support Agreement, Paragraph 12, and Software License Agreement, Paragraph 17, are amended in their entirety to read as follows: If Licensee fails to comply with any of the terms and conditions of this Agreement, Innovyze may terminate the license granted hereunder upon thirty (30) days written notice, provided that Licensee shall be afforded ten (10)days to cure the non-compliance. In the event of termination, Licensee must immediately uninstall the Software and return any accompanying materials and hardware and provide written confirmation that Licensee has complied with the terms of this provision. 4. Software License Agreement, Paragraph 16, and Software Maintenance and Support Agreement Paragraph 11, are amended in their entirety to read as follows: Controlling Law. The validity, construction, and performance of this Agreement shall be governed in accordance with the laws of the State of California, USA. The parties agree that any proceeding arising out this Agreement shall be instituted in Orange County, State of California, USA, and each party irrevocably submits to the jurisdiction of such proceeding and waives any and all objections to jurisdiction and venue that it may have under any other law. Licensee acknowledges and agrees that this Addendum is subject to the terms and conditions set forth in the referenced Software License Agreement and Maintenance & Support Agreement between the parties. Except as set forth in the addendum, all other terms and conditions of the Software License Agreement and Maintenance&Support Agreement shall apply including the limitation of liability and consequential damage waivers. innovyz2` Signature page follows APPROVAL AND EFFECTIVE DATE This Addendum shall not be binding until signed by all Parties. The Parties signing this Addendum represent and acknowledge that they have the authority to bind their respective parties. Licensee Innovyze, Inc. Signature signature Erick Heath Pnnted Name Pnnted Name Vice President rule rule March 22,2016 Date Date ADMINISTRATION COMMITTEE Meeting Date ToedorDir. 04/13/16 0Z7, 6 AGENDA REPORT I em Number Rem Number 3 Orange County Sanitation District FROM: James D. Herberg, General Manager Originator: Lorenzo Tyner, Director of Finance and Administrative Services SUBJECT: COOPERATIVE PROCUREMENT WITH U.S. COMMUNITIES GOVERNMENT PURCHASING ALLIANCE GENERAL MANAGER'S RECOMMENDATION Authorize purchases of information technology products, services, and solutions using the County of Fairfax, Virginia contract number#4400006644 with Insight Public Sector available through U.S. Communities Government Purchasing Alliance, for the period May 1, 2016 through April 30, 2019, for a total amount not to exceed $800,000, in accordance with Ordinance OCSD47, Section 2.03(B) Cooperative Purchases. SUMMARY County of Fairfax, Virginia has awarded the contract for purchasing technology products, services, solutions, and related products and services to Insight Public Sector under contract #4400006644 per RFP2000001701 beginning May 1, 2016 through April 30, 2019. This contract has been established by County of Fairfax, Virginia's Department of Purchasing and Supply Management as the lead agency, with Insight Public Sector as the primary provider of technology products needed to complete an entire technology solution based on contract pricing, breadth of product offerings, availability and the ease of using online ordering systems. Large capital items will be procured through the bidding process. BACKGROUND In order to properly maintain and provide solutions to Orange County Sanitation District's (Sanitation District) facilities, the Information Technology Division (IT) has needs to purchase technology products, services, solutions, and related products and services. Such item requirements have been forecasted based upon projected obsolete equipment, historical product failure rates, and new items to address general capacity, redundancy, or security. Since technology changes so frequently, it is not appropriate to stock these items in the Sanitation District's warehouses. RELEVANT STANDARDS Ensure that the public's money is wisely spent Page 1 of 3 PROBLEM The procurement process on information technology items and services for a local agency like the Sanitation District involves a lot of effort and associated costs. IT needs to work diligently in finding ways to streamline the procurement process while minimizing cost concomitant of the procurement of technology items. PROPOSED SOLUTION The Sanitation District's purchasing power is limited therefore utilizing other large agencies' cooperative agreement/s who have completed a vetted procurement process is a viable and economical solution. TIMING CONCERNS Existing purchase order to procure technology items using U.S. Communities Government Purchasing Alliance expires on April 30, 2016. Deployment of new systems and solutions is imperative to support plant operations and maintenance initiatives without delay. RAMIFICATIONS OF NOT TAKING ACTION Increased cost related to the procurement of technology items; increased risk of being unable to or delay support plant operations and maintenance. PRIOR COMMITTEE/BOARD ACTION/S: November 2014: Board Award Minute Order 11/19/2014, Item 9. ADDITIONAL INFORMATION U.S. Communities Government Purchasing Alliance is the leading national government purchasing cooperative, providing government procurement resources and solutions to local and state government agencies, school districts (K-12), higher education institutes, and nonprofits looking for the best overall supplier government pricing. The program is available to all State of California governmental entities (State agencies, cities, counties, special districts, school districts, universities, etc.) that expend public funds for the acquisition of both goods and services. U.S. Communities Government Purchasing Alliance is a government purchasing cooperative that reduces the cost of goods and services by aggregating the purchasing power of public agencies nationwide. U.S. Communities has over 55,000 participating agencies, from both the public and nonprofit sectors. The U.S. Communities Advisory Board is made up of key government purchasing officials from across the United States. The Advisory Board provides leadership and overall direction for the U.S. Communities Government Purchasing Alliance. The State of California Procurement Division (PD) is the central purchasing authority for all State departments and local government agencies. Page 2 of 3 With a massive marketplace and billions of dollars in purchasing power they are able to offer a lower procurement cost to California's State, county, city, special district, education and other government entities through their Leveraged Procurement Agreements (LPAs). LPAs allow entities/agencies to buy directly from suppliers through existing contracts and agreements. One of the LPA's that the state offers to California governmental agencies is the U.S. Communities Government Purchasing Alliance for technology products, equipment and technology services, and solutions. The Sanitation District staff has verified that pricing has been checked for competitiveness based upon volume pricing through this cooperative. CEQA N/A FINANCIAL CONSIDERATIONS This request complies with authority levels of the Sanitation District's Purchasing Ordinance OCSD-47, Section 2.03(B) Cooperative Purchases. This item has been budgeted in the established annual Joint Operating budget. ATTACHMENT The following attachment(s) may be viewed on-line at the OCSD website (www.ocsd.com) with the complete agenda package: N/A Page 3 of 3 ADMINISTRATION COMMITTEE Meeing Date To ad.of Dir. 04/13/16 -- AGENDA REPORT IWrn Number Item Number a Orange County Sanitation District FROM: James D. Herberg, General Manager Originator: Celia Chandler, Director of Human Resources SUBJECT: CLASSIFICATION & COMPENSATION STUDY—VENDOR CHANGE GENERAL MANAGER'S RECOMMENDATION A. Award a Professional Consultant Services Agreement with Koff and Associates for the compensation phase of the classification and compensation study, Specification CS-2014-63013D, for a total amount not to exceed $65,040, with a new total amount of phase one and two not to exceed of$126,929; and B. Approve a contingency of$6,504 (10%). SUMMARY BACKGROUND The organization initiated its comprehensive classification and compensation study in March 2015 for the purpose of updating its job classification specifications and benchmark against other organizations' job structures and compensation for employees in similar positions. Aside from the time lapse from the last study, additional key business reasons for conducting a study at this time include changes due to reorganization, the strategic plan, recruitment/retention considerations, and labor relations. A comprehensive classification and compensation (C&C)study will provide the Board of Directors with updated data to meet the strategic initiative of organizational efficiency and effectiveness, to include the establishment of an official pay policy to manage labor costs. RELEVANT STANDARDS • Support ongoing workforce planning and workforce development efforts • Comply with Article 29 Classification Studies of OCSD's Memoranda of Understanding with represented employee groups • Industry best practices recommend a study every five years for business relevance and compliance with the Americans with Disabilities Act (ADA) and the Fair Labor Standards Act (FLSA) Page 1 of 3 PROBLEM Orange County Sanitation District (Sanitation District) seeks authorization to proceed with the compensation phase of the C&C Study. The original vendor selected for the studies completed the classification phase, but will not conduct the compensation phase. PROPOSED SOLUTION Award the compensation phase of the C & C Study to the vendor, Koff and Associates that placed second in the procurement process. TIMING CONCERNS Koff and Associates placed second in the original procurement process for the current C & C Study, which was conducted through the request for proposal (RFP) process, Specification CS-2014-63013D. Koff and Associates has provided an updated project proposal that supports the Sanitation District meeting the intended project timeline with a comprehensive final report and a presentation to the Orange County Sanitation District Board. RAMIFICATIONS OF NOT TAKING ACTION By not awarding the remainder of the project to the second placed vendor (Koff and Associates), the Sanitation District would initiate a competitive bid process for the compensation phase of the study that would further delay the completion of the project. PRIOR COMMITTEE/BOARD ACTIONS September 2015: Board of Directors approved the list of 17 comparison agencies selected by Sanitation District in collaboration with stakeholder groups and approved to begin the next phase of the C & C Study, which includes a labor market survey. February 2014: The Administration Committee authorized the General Manager to advertise a request for proposal and subsequently award a Consultant Services Agreement for an OCSD-wide C&C Study, for a total amount not to exceed $100,000. ADDITIONAL INFORMATION The Sanitation District advertised a request for proposal for comprehensive C & C Study in August 2014. Gallagher Benefit Services, Inc. was the vendor selected for the project at a proposed cost of $98,000. The classification phase of the project has been completed by Gallagher Benefit Services for a total cost to date of $61,889. The compensation phase for the project is still pending. Page 2 of 3 Sanitation District management has identified a need to change vendors for the compensation phase of Sanitation District's C & C Study due to concerns with the current vendor's ability to meet the intended timeline, the quality of their work, and their methodology with regard to the compensation phase of the study. The contract with the existing vendor was canceled on March 25, 2016, as stipulated in the contract. CEQA N/A FINANCIAL CONSIDERATIONS The cost for the project's compensation phase with Koff and Associates will not exceed $72,000. The completed classification phase with Gallagher Benefit Services cost $61,889. The total cost to complete the project will not exceed $133,889. This request complies with authority levels of the Sanitation District's Purchasing Ordinance. This item has been budgeted. ATTACHMENT The following attachment(s)may be viewed on-line at the OCSD website(www.ocsd.coml with the complete agenda package: • Professional Consultant Services Agreement • Cost Estimate for a Total Compensation Study, Koff and Associates (dated 4/4/2016) Page 3 of 3 PROFESSIONAL CONSULTANT SERVICES AGREEMENT OCSD Classification & Compensation Studies 2014.15 All Employee Groups Specification No. CS-2014-63OBD THIS AGREEMENT is made and entered into as of the date fully executed below by and between Orange County Sanitation District, with a principal place of business at 10844 Ellis Avenue, Fountain Valley, CA 92708-7018 (hereinafter referred to as "OCSD") and Koff&Associates with a principal business at 2835 Seventh Street, Berkeley, California 94710 (hereinafter referred to as "Consultant") collectively referred to as the "Parties". WITNESSETH WHEREAS, based on Consultant's expertise and experience, OCSD wishes to temporarily engage Consultant to provide OCSD Classification & Compensation Studies 2014-15 All Employee Groups ("Services")as described in Exhibit"A"; and WHEREAS, Consultant submitted its revised proposal, dated April4, 2016; and WHEREAS, on April 13, 2016, the Operations Committee of OCSD, authorized execution of this Agreement between OCSD and Consultant; and WHEREAS, OCSD has chosen Consultant to conduct Services in accordance with Ordinance No. OCSD-47; and NOW, THEREFORE, in consideration of the mutual promises and mutual benefits exchanged between the Parties, the Parties mutually agree as follows: 1. Introduction 1.1 This Agreement and all exhibits hereto (called the "Agreement") is made by OCSD and Consultant. The Terms and Conditions herein exclusively govern the purchase of Services as described in the Scope of Work. 1.2 Exhibits to this Agreement are incorporated by reference and made a part of this Agreement as though fully set forth at length herein. Exhibits to this Agreement are as follows in order of precedence: Exhibit"A" Scope of Work— Included in Exhibit"B" Exhibit"B" Koff&Associates Revised Proposal Dated April 4, 2016 Exhibit"C" Koff&Associates Acknowledgement of Insurance Requirements Exhibit"D" NOT USED 1.3 In the event of any conflict or inconsistency between the provisions of this Agreement and any of the provisions of the exhibits hereto, the provisions of this Agreement shall in all respects govern and control. 1.4 This Agreement may not be modified, changed or supplemented, nor may any obligations hereunder be waived or extensions of time for performance granted, except by written instrument signed by both Parties. 1.5 The various headings in this Agreement are inserted for convenience only and shall not affect the meaning or interpretation of this Agreement or any Paragraph or provision hereof. Orange County Sanitation District 1 Of 10 Specification No. CS-2014-63OBD 1.6 The term "days", when used in the Agreement, shall mean calendar days, unless otherwise noted as workdays. 1.7 The term "workday". Workdays are defined as all days that are not Saturday, Sunday, or legally observed holidays. Meetings with OCSD staff shall be scheduled from Monday through Thursday between the hours of 8AM and 4PM (exception is operations staff who maintain plant operations 24/7 and work a rotated 12-hour shift) and shall conform to OCSD work schedules. OCSD review periods shall not include legally observed holidays. 1.8OCSD holidays (non-working days) are as follows: New Year's Day, Lincoln's Birthday, Presidents' Day Monday, Memorial Day Monday, Independence Day, Labor Day Monday, Veterans Day, Thanksgiving Day, Day after Thanksgiving, Christmas Eve, and Christmas Day. 1.9 Work Hours: The work required under this Agreement may include normal Business hours, evenings, and weekends. OCSD will not pay Travel Time. 1.10 Consultant shall provide OCSD with all required premiums and/or overtime work at no charge beyond the price provided [below or in Exhibit"B"]. 1.11 Except as expressly provided otherwise, OCSD accepts no liability for any expenses, losses, or action incurred or undertaken by Consultant as a result of work performed in anticipation of purchases of said services by OCSD. 2. Scope of Work Subject to the terms of this Agreement, Consultant shall perform the Services identified in Exhibit "A". Consultant warrants that all of its Services shall be performed in a competent, professional and satisfactory manner. 3. Modifications to Scope of Work Requests for modifications to the Scope of Work hereunder can be made by OCSD at any time. All modifications must be made in writing and signed by both Parties. A review of the time required for the modification will be made by OCSD and Consultant and the Agreement period adjusted accordingly. 4. Compensation Compensation to be paid by OCSD to Consultant for the Services provided under this Agreement shall be a total amount not to exceed Sixty Five Thousand Forty dollars ($65,040.00). 5. Payment and Invoicing 5.1 Consultant shall be paid monthly by OCSD upon approval of invoices by OCSD Project Manager or designee, for Services rendered as outlined in Exhibit "A". OCSD, at its sole discretion, shall be the determining party as to whether the Services have been satisfactorily completed. 5.2 Invoices shall be emailed by Consultant to OCSD Accounts Payable at APStaff@OCSD.com and "INVOICE"and the Purchase Order number and "CS-2014-630BD, OCSD Classification &Compensation Studies 2014-2015 All Employee Groups"shall be referenced in the subject line. 6. Audit Rights Consultant agrees that, during the term of this Agreement and for a period of three (3) years after its termination, OCSD shall have access to and the right to examine any directly pertinent books, documents, and records of Consultant relating to the invoices submitted by Consultant pursuant to this Agreement. Orange County Sanitation District 2 of 10 Specification No. CS-2014-630BD 7. Commencement and Term The Services to be provided by Consultant under this Agreement shall commence on the date of the Notice to Proceed, and be completed in accordance with Exhibit"B". & Extensions The Term of this Agreement may be extended only by written instrument signed by both Parties. 9. Performance Time is of the essence in the performance of the provisions hereof. 10. Termination 10.1 OCSD reserves the right to terminate this Agreement for its convenience, with or without cause, in whole or in part, at any time, by written notice from OCSD. Upon receipt of a termination notice, Consultant shall immediately discontinue all work under this Agreement (unless the notice directs otherwise). OCSD shall thereafter, within thirty (30) days, pay Consultant for work performed (cost and fee)to the date of termination. Consultant expressly waives any claim to receive anticipated profits to be earned during the uncompleted portion of this Agreement. Such notice of termination shall terminate this Agreement and release OCSD from any further fee, cost or claim hereunder by Consultant other than for work performed to the date of termination. 10.2 OCSD reserves the right to terminate this Agreement immediately upon OCSD's determination that Consultant is not meeting specification requirements, if the level of service is inadequate, or any other default of this Agreement. 10.3 OCSD may also immediately cancel for default of this Agreement in whole or in part by written notice to Consultant: • if Consultant becomes insolvent or files a petition under the Bankruptcy Act; or • if Consultant sells its business; or • if Consultant breaches any of the terms of this Agreement; or • if total amount of compensation exceeds the amount authorized under this Agreement. 10.4 All OCSD property in the possession or control of Consultant shall be returned by Consultant to OCSD on demand, or at the termination of this Agreement, whichever occurs first. 11. Indemnification and Hold Harmless Provision Consultant shall assume all responsibility for damages to property and/or injuries to persons, including accidental death, which may arise out of or be caused by Consultant's services under this Agreement, or by its subcontractor or by anyone directly or indirectly employed by Consultant, and whether such damage or injury shall accrue or be discovered before or after the termination of the Agreement. Except as to the sole active negligence of or willful misconduct of OCSD, Consultant shall indemnify, protect, defend and hold harmless OCSD, its elected and appointed officials, officers, agents and employees, from and against any and all claims, liabilities, damages or expenses of any nature, including attorneys' fees: (a) for injury to or death of any person or damage to property or interference with the use of property, arising out of or in connection with Consultant's performance under the Agreement, and/or (b) on account of use of any copyrighted or uncopyrighted material, composition, or process, or any patented or unpatented invention, article or appliance, furnished or used under the Agreement, and/or(c)on account of any goods and services provided under this Agreement. This indemnification provision shall apply to any acts or omissions, willful misconduct, or negligent misconduct, whether active or passive, on the part of Consultant or anyone Orange County Sanitation District 3 of 10 Specification No. CS-2014-630BD employed by or working under Consultant. To the maximum extent permitted by law, Consultant's duty to defend shall apply whether or not such claims, allegations, lawsuits, or proceedings have merit or are meritless, or which involve claims or allegations that any of the parties to be defended were actively, passively, or concurrently negligent, or which otherwise assert that the parties to be defended are responsible, in whole or in part, for any loss, damage, or injury. Consultant agrees to provide this defense immediately upon written notice from OCSD, and with well qualified, adequately insured, and experienced legal counsel acceptable to OCSD. This section shall survive the expiration or early termination of the Agreement. 12. Insurance Consultant and all subcontractors shall purchase and maintain, throughout the life of this Agreement and any periods of warranty or extensions, insurance in amounts equal to the requirements set forth in the signed Acknowledgement of Insurance Requirements, Exhibit "C". Consultant shall not commence work under this Agreement until all required insurance is obtained in a form acceptable to OCSD, nor shall Consultant allow any subcontractor to commence service pursuant to a subcontract until all insurance required of the subcontractor has been obtained. Failure to maintain required insurance coverage shall result in termination of this Agreement. 13. Key Personnel - NOT USED 14. Confidentiality and Non-Disclosure 14.1 Consultant acknowledges that in performing the Services hereunder, OCSD may have to disclose to Consultant orally and in writing certain confidential information that OCSD considers proprietary and has developed at great expense and effort. 14.2 Consultant agrees to maintain in confidence and not disclose to any person, firm, or corporation,without OCSD's prior written consent,any trade secret or confidential information, knowledge or data relating to the products, process, or operation of OCSD. 14.3 Consultant further agrees to maintain in confidence and not to disclose to any person, firm, or corporation any data, information, technology, or material developed or obtained by Consultant during the term of this Agreement. 14.4 Consultant agrees as follows: • To use the Confidential Information only for the purposes described herein; to not reproduce the Confidential Information; to hold in confidence and protect the Confidential Information from dissemination to and use by anyone not a party to this Agreement; and to not use the Confidential Information to benefit itself or others. • To restrict access to the Confidential Information to its Consultant or personnel of Consultant who (1) have a need to have such access and (2) have been advised of and have agreed in writing to treat such information in accordance with the terms of this Agreement. • To return all Confidential Information in Consultant's possession upon termination of this Agreement or upon OCSD's request, whichever occurs first. • To hold in confidence information and materials, if any, developed pursuant to the Services hereunder. 14.5 The provisions of this Section shall survive termination or expiration of this Agreement and shall continue for so long as the material remains confidential. 15. Ownership of Documents All drawings, specifications, reports, records, documents, Orange County Sanitation District 4 of 10 Specification No. CS-2014-630BD memoranda, correspondence, computations, and other materials prepared by Consultant, its employees, subcontractors, and agents in the performance of this Agreement shall be the property of OCSD and shall be promptly delivered to OCSD upon request of the Project Manager or upon the termination of this Agreement, and Consultant shall have no claim for further employment or additional compensation as a result of the exercise by OCSD of its full rights of ownership of the documents and materials hereunder. Any use of such completed documents for other projects and/or use of incomplete documents without specific written authorization by the Consultant will be at OCSD's sole risk and without liability to Consultant. Consultant shall ensure that all its subcontractors shall provide for assignment to OCSD of any documents or materials prepared by them. 16. Ownership of Intellectual Property 16.1 Consultant agrees that all designs, plans, reports, specifications, drawings, schematics, prototypes, models, inventions, and all other information and items made during the course of this Agreement and arising from the Services (hereinafter referred to as "New Developments")shall be and are assigned to OCSD as its sole and exclusive property. 16.2 Consultant agrees to promptly disclose to OCSD all such New Developments. Upon OCSD's request, Consultant agrees to assist OCSD, at OCSD's expense, to obtain patents or copyrights for such New Developments, including the disclosure of all pertinent information and data with respect thereto, the execution of all applications, specifications, assignments, and all other instruments and papers which OCSD shall deem necessary to apply for and to assign or convey to OCSD, its successors and assigns, the sole and exclusive right, title and interest in such New Developments. Consultant agrees to obtain or has obtained written assurances from its employees and contract personnel of their agreement to the terms hereof with regard to New Developments and Confidential Information. 16.3 Consultant warrants that Consultant has good title to any New Developments, and the right to assign New Developments to OCSD free of any proprietary rights of any other party or any other encumbrance whatever. 16.4 The originals of all computations, drawings, designs, graphics, studies, reports, manuals, photographs, videotapes, data, computer files, and other documents prepared or caused to be prepared by Consultant or its subcontractors in connection with these Services shall be delivered to and shall become the exclusive property of OCSD. OCSD may utilize these documents for OCSD applications on other projects or extensions of this project, at its own risk. 17. No Solicitation of Employees Or Subcontractors 17.1 Consultant agrees that it shall not, during the term of this Agreement and for a period of one (1) year immediately following termination of this Agreement, or any extension hereof, call on, solicit, or take away any of the employees or subcontractors about whom Consultant became aware as a result of Consultant's Services to OCSD. 17.2 Consultant acknowledges that OCSD's employees are critical to its business. Consultant agrees not to employ or otherwise engage OCSD's employees or subcontractors during the term of this Agreement and for a period of one(1)yearfollowing termination of this Agreement. Should Consultant violate this provision, Consultant will pay OCSD fifty percent (50%) of the former employee's annual salary which payment is in addition to OCSD's rights and remedies. 18. Independent Contractor Capacity Orange County Sanitation District 5 of 10 Specification No. CS-2014-63OBD 18.1 The relationship of Consultant to OCSD is that of an independent contractor and nothing herein shall be construed as creating an employment or agency relationship. 18.2 Consultant shall act independently and not as an officer or employee of OCSD. OCSD assumes no liability for Consultant's action and performance, nor assumes responsibility for taxes, funds, payments or other commitments, implied or expressed, by or for Consultant. 18.3 Consultant shall not be considered an agent of OCSD for any purpose whatsoever, nor shall Consultant have the right to, and shall not, commit OCSD to any agreement, contract or undertaking. Consultant shall not use OCSD's name in its promotional material or for any advertising or publicity purposes without expressed written consent. 18.4 Consultant shall not be entitled to any benefits accorded to those individuals listed on OCSD's payroll as regular employees including, without limitation, worker's compensation, disability insurance, vacation, holiday or sick pay. Consultant shall be responsible for providing, at Consultant's expense, disability, worker's compensation or other insurance as well as licenses and permits usual or necessary for conducting the Services hereunder. 18.5 Consultant shall be obligated to pay any and all applicable local, state and federal payroll and other taxes incurred as a result of fees hereunder. Consultant hereby indemnifies OCSD for any claims, losses, costs, fees, liabilities, damages or penalties suffered by OCSD arising out of Consultant's breach of this provision. 18.6 Consultant shall not be eligible to join or participate in any benefit plans offered to those individuals listed on OCSD's payroll as regular employees. Consultant shall remain ineligible for such benefits or participation in such benefit plans even if a court later decides that OCSD misclassified Consultant for tax purposes. 19. Licenses, Permits Consultant represents and warrants to OCSD that it has obtained all licenses, permits, qualification and approvals of whatever nature that are legally required to engage in this work. Any and all fees required by State, County, City and/or municipal laws, codes and/or tariffs that pertain to work performed under the terms of this Agreement will be paid by Consultant. 20. Consultant's Representations In the performance of duties under this Agreement, Consultant shall adhere to the highest fiduciary standards, ethical practices and standards of care and competence for their trade/profession. Consultant agrees to comply with all applicable Federal, State and local laws and regulations. 21. Familiarity with Work By executing this Agreement, Consultant warrants that: 1) it has investigated the work to be performed; 2) it has investigated the site of the work and is aware of all conditions there; and 3) it understands the facilities, difficulties and restrictions of the work under this Agreement. Should Consultant discover any latent or unknown conditions materially differing from those inherent in the work or as represented by OCSD, it shall immediately inform OCSD of this and shall not proceed, except at Consultant's risk, until written instructions are received from OCSD. 22. Riaht to Review Services. Facilities. and Records 22.1 OCSD reserves the right to review any portion of the Services performed by Consultant under this Agreement, and Consultant agrees to cooperate to the fullest extent possible. 22.2 Consultant shall furnish to OCSD such reports, statistical data, and other information Orange County Sanitation District 6 of 10 Specification No. CS-2014-630BD pertaining to Consultant's Services as shall be reasonably required by OCSD to carry out its rights and responsibilities under its agreements with its bondholders or noteholders and any other agreement relating to the development of the project(s) and in connection with the issuance of its official statements and other prospectuses with respect to the offering, sale, and issuance of its bonds and other obligations. 22.3 The right of OCSD to review or approve drawings, specifications, procedures, instructions, reports, test results, calculations, schedules, or other data that are developed by Consultant shall not relieve Consultant of any obligation set forth herein. 23. Force Maieure Neither party shall be liable for delays caused by accident,flood, acts of God, fire, labor trouble, war, acts of government or any other cause beyond its control, but said party shall use reasonable efforts to minimize the extent of the delay. Work affected by a Force Majeure condition may be rescheduled by mutual consent or may be eliminated from the Agreement. 24. Severability If any section, subsection, or provision of this Agreement, or any agreement or instrument contemplated hereby, or the application of such section, subsection, or provision is held invalid, the remainder of this Agreement or instrument in the application of such section, subsection or provision to persons or circumstances other than those to which it is held invalid, shall not be affected thereby, unless the effect of such invalidity shall be to substantially frustrate the expectations of the Parties. 25. Waiver The waiver of either party of any breach or violation of, or default under, any provision of this Agreement, shall not be deemed a continuing waiver by such party of any other provision or of any subsequent breach or violation of this Agreement or default thereunder. Any breach by Consultant to which OCSD does not object shall not operate as a waiver of OCSD's rights to seek remedies available to it for any subsequent breach. 26. Remedies In addition to other remedies available in law or equity, if the Consultant fails to make delivery of the goods or Services or repudiates its obligations under this Agreement, or if OCSD rejects the goods or Services or revokes acceptance of the goods or Services,OCSD may(1) cancel the Agreement; (2)recover whatever amount of the purchase price OCSD has paid, and/or (3) "cover' by purchasing, or contracting to purchase, substitute goods or Services for those due from Consultant. In the event OCSD elects to"cover" as described in (3), OCSD shall be entitled to recover from Consultant as damages the difference between the cost of the substitute goods or Services and the contract price,together with any incidental or consequential damages. 27. Governing Law This Agreement shall be governed by and interpreted under the laws of the State of California and the Parties submit to jurisdiction in Orange County, in the event any action is brought in connection with this Agreement or the performance thereof. 28.Attorney's Fees If any action at law or inequity or if any proceeding in the form of an Alternative Dispute Resolution (ADR) is necessary to enforce or interpret the terms of this Agreement, the prevailing party shall be entitled to reasonable attorney's fees, costs and necessary disbursements in addition to any other relief to which he may be entitled. 29. Dispute Resolution 29.1 In the event of a dispute as to the construction or interpretation of this Agreement, or any rights or obligations hereunder, the Parties shall first attempt, in good faith, to resolve the Orange County Sanitation District 7 of 10 Specification No. CS-2014-630BD dispute by mediation. The Parties shall mutually select a mediator to facilitate the resolution of the dispute. If the Parties are unable to agree on a mediator, the mediation shall be conducted in accordance with the Commercial Mediation Rules of the American Arbitration Agreement,through the alternate dispute resolution procedures of Judicial Arbitration through Mediation Services of Orange County ("JAMS"), or any similar organization or entity conducting an alternate dispute resolution process. 29.2 In the event the Parties are unable to timely resolve the dispute through mediation, the issues in dispute shall be submitted to arbitration pursuant to California Code of Civil Procedure, Part 3, Title 9, Sections 1280 at seq. For such purpose, an agreed arbitrator shall be selected, or in the absence of agreement, each party shall select an arbitrator, and those two arbitrators shall select a third. Discovery may be conducted in connection with the arbitration proceeding pursuant to California Code of Civil Procedure Section 1283.05. The arbitrator, or three arbitrators acting as a board, shall take such evidence and make such investigation as deemed appropriate and shall render a written decision on the matter in question. The arbitrator shall decide each and every dispute in accordance with the laws of the State of California. The arbitrator's decision and award shall be subject to review for errors of fact or law in the Superior Court for the County of Orange, with a right of appeal from any judgment issued therein. 30. Damage to OCSD's Property Any OCSD property damaged by Consultant will be subject to repair or replacement by Consultant at no cost to OCSD. 31. 00SD Safety and Human Resources Policies OCSD requires all contractors and Consultants to follow and ensure their employees and all subcontractors follow all State and Federal regulations as well as OCSD requirements while working at OCSD locations. If during the course of a contract it is discovered that OCSD policies, safety manuals, or contracts do not comply with State or Federal regulations then the Consultant is required to follow the most stringent regulatory requirement at no cost to OCSD. Consultant and all their employees and subcontractors, shall adhere to all applicable OCSD Safety and Human Resources Policies found at: OCSD.com, "Doc Central" (bottom of page), under"Safety". 32. Freight (F.O.B. Destination) Consultant assumes full responsibility for all transportation, transportation scheduling, packing, handling, insurance, and other services associated with delivery of all products deemed necessary under this Agreement. 33.Assionments Consultant shall not delegate any duties nor assign any rights under this Agreement without the prior written consent of OCSD. Any such attempted delegation or assignment shall be void. 34. Conflict of Interest and Reporting 34.1 Consultant shall at all times avoid conflict of interest or appearance of conflict of interest in performance of this Agreement. 34.2 Consultant affirms that to the best of its knowledge there exists no actual or potential conflict between Consultant's families, business or financial interest or its Services under this Agreement, and in the event of change in either its private interests or Services under this Agreement, it will raise with OCSD any question regarding possible conflict of interest which may arise as a result of such change. 35. Third Party Rights Nothing in this Agreement shall be construed to give any rights or benefits to anyone other than OCSD and Consultant. Orange County Sanitation District 8 Of 10 Specification No. CS-2014-63OBD 36. Non-Liability of OCSD Officers and Employees No officer or employee of OCSD shall be personally liable to Consultant, or any successor-in-interest, in the event of any default or breach by OCSD or for any amount which may become due to Consultant or to its successor, or for breach of any obligation of the terms of this Agreement. 37.Authority to Execute The persons executing this Agreement on behalf of the Parties warrant that they are duly authorized to execute this Agreement and that by executing this Agreement, the Parties are formally bound. 36. Read and Understood By signing this Agreement, Consultant represents that he has read and understood the terms and conditions of the Agreement. 39. Entire Agreement This Agreement constitutes the entire agreement of the Parties and supersedes all prior written or oral and all contemporaneous oral agreements, understandings, and negotiations between the Parties with respect to the subject matter hereof. Orange County Sanitation District 9 Of 10 Specification No. CS-2014-63OBD 40. Notices All notices under this Agreement must be in writing. Written notice shall be delivered by personal service or sent by registered or certified mail, postage prepaid, return receipt requested, or by any other overnight delivery service which delivers to the noticed destination and provides proof of delivery to the sender. Any facsimile notice must be followed within three (3) days by written notice. Rejection or other refusal to accept or the inability to deliver because of changed address for which no notice was given as provided hereunder shall be deemed to be receipt of the notice, demand or request sent. All notices shall be effective when first received at the following addresses: OCSD: Ludwig Lapus Contracts Administrator Orange County Sanitation District 10844 Ellis Avenue Fountain Valley, CA 92708-7018 Consultant: Koff&Associates Georg S. Krammer 2835 Seventh Street Berkeley, CA 94710 Each party shall provide the other party written notice of any change in address as soon as practicable. IN WITNESS WHEREOF, the Parties hereto have hereunto set their hands the day and year indicated below. ORANGE COUNTY SANITATION DISTRICT Dated: By: Chair Administration Committee Dated: By: Clerk of the Board Dated: By: Contracts/Purchasing Manager COMPANY Dated: By: Print Name and Title of Officer IRS Employer's I.D. Number Orange County Sanitation District 10 of 10 Specification No. CS-2014-63OBD Submittal date: April 4, 2016 Cost Estimate for a Total Compensation Study Orange County Sanitation District Submitted By: Koff & Associates GEORG S.KRAMMER Chief Executive Officer 2835 Seventh Street Berkeley,CA 94710 www.KoffAssociates.com gkrammer@koffassociates.com Tel: 510.658.5633 Fax:510.652.5633 IM ■ Koff & Associates Solving the Human Resources Punle for W Years April 4,2016 Sent via Email Mr. Richard Spencer Human Resources Manager Orange County Sanitation District Dear Richard, Thank you for the opportunity to respond to your request for a cost estimate for a Total Compensation Study for the Orange County Sanitation District. We are most interested in assisting the District with this important project and feel that we are uniquely qualified to provide value to the District based on our experience with your agency over the years, as well as performing similar studies for other public agencies throughout California regarding their compensation plans,structures, and philosophies. As you know, Koff & Associates is an experienced Human Resources consulting firm that has been providing classification and compensation consulting services to special districts,cities,counties, courts, educational institutions, and other public agencies for thirty-two (32) years. Founded in 1984, the firm is a woman-owned California small business corporation and has achieved a reputation for working successfully with management, employees, and union representatives. We believe in a high level of dialogue and input from study stakeholders and our proposal speaks to that level of effort. That extra effort has resulted in close to 100% implementation of all of our compensation (and classification) studies, including our recommendations for compensation (and classification) plan designs and structures. As CEO of our firm, I would assume the role of Project Director and be responsible for the successful completion of the project. I can be reached at our Berkeley address and phone number listed below and on the cover page; my email is gkrammer(@koffassociates.com. This cost estimate will remain valid for ninety(90)days from the date of submittal. Please call if you have any questions or wish additional information. We look forward to the opportunity to provide professional services to the Orange County Sanitation District. Sincerely yours, Georg S. Krammer Chief Executive Officer 2835 Seventh Street, Berkeley, California 94710 1510.658.5633 1 www.KoffAssociates.com IM Total Compensation Study - Cost Estimate Orange County Sanitation District TABLE OF CONTENTS COST PROPOSAL 1 TIMELINE 1 Proposal Signature Page 2835 Seventh Street, Berkeley, California 94710 1510.658.5633 1 www.KoffAssociates.com IM Total Compensation Study - Cost Estimate Orange County Sanitation District Project Schedule We understand that the District's goal is to complete the compensation study by the end of June and present a report to the Board of Directors in July. We are also aware that the District is in the process of finalizing new/updated classification descriptions and plans to complete this effort concurrently. To allow the maximum amount of time for data collection and analysis,we suggest that the District initiate the compensation study as soon as possible as our consultant staff could easily start the data collection process while the District is finalizing class descriptions. There is a lot of data gathering,downloading of documents from comparator agency websites, etc. that needs to occur, which can be accomplished without reviewing class descriptions. This will put us in a good position to focus on data analysis only once the class descriptions are final and can be sent to us for review and analysis. The following is an estimated timeline, which ideally would start by the beginning of April in order to be ready and prepared to present the study to the Board in July. ompTask Compensation Study Timeline aDatel By: D A. Identify/Confirm Comparator Agencies, Benchmark Classifications, and 1 week Benefits to be Collected B. Data Collection 6 weeks C. Analysis and Preliminary Data Review 7 weeks D. Draft Compensation Findings/Additional Analysis/Client Meeting 8 weeks E. Internal Relationship Analysis and Internal Alignment 9 weeks F. Compensation Structure and Implementation Plan Development 9 weeks G. Preparation of Draft Final and Final Report and Deliverables 10 weeks H. Final Presentation to the Project Team and Board of Directors As Needed Compensation Study Cost #of Hours: A. Identify/Confirm Comparator Agencies, Benchmark Classifications, Benefits to 4 Be Collected (we understand that the District has already determined 18 agencies that will be surveyed;therefore,this project task will involve selecting benchmark classifications and agreeing to a list of benefits that will be included in the survey) B. Compensation Data Collection: up to 100 benchmarks, IS comparator 265 agencies;if fewer benchmarks end up being selected, we are happy to adjust our project fee accordingly. C. Analysis and Preliminary Data Review: up to 100 benchmarks,18 comparator 135 agencies. D. Draft Compensation Findings/Additional Analysis/Client Meeting 70 E. Internal Relationship Analysis/Internal Alignment 12 F. Compensation Structure and Implementation Plan Development 20 G. Development of Draft Final and Final Report and Deliverables 16 2835 Seventh Street, Berkeley, California 94710 1510.658.5633 1 www.KoffAssociates.com 1 IM Classification & Compensation Study — Cost Estimate East Bay Regional Park District H. Final Presentation to the Project Team and Board of Directors 30 Additional meetings with Study Project Team,employees,and/or other 30 stakeholders Total Professional Hours 542 Combined professional and clerical composite rate: $120/Hour $65,040 Expenses are included in our hourly rate: Expenses include but are not limited to duplicating documents,binding reports, phone,supplies,postage,airfare,hotels,rental cars,travel time,per diem,etc. TOTAL PROJECT COST FOR COMPENSATION STUDY NOT TO EXCEED: $65,040 *Additional consulting will be honored at composite rate($120) 2835 Seventh Street, Berkeley, California 94710 1510.658.5633 1 www.KoffAssociates.com 2 IM Total Compensation Study - Cost Estimate Orange County Sanitation District Proposal Signature Page This proposal is valid for ninety(90)days. Respectfully submitted, By: KOFF &ASSOCIATES State of California �-Ms-bw Georg S. Krammer April 4, 2016 Chief Executive Officer Date IM ■ Koff Assoriatps SoKnng the Human Resources Puzzle for 30 Years 2835 Seventh Street, Berkeley, California 94710 1510.658.5633 1 www.KoffAssociates.com ADMINISTRATION COMMITTEE Meeting Date To ad.of Dir. 04,13,16 -- AGENDA REPORT IWrn Number Item Number s Orange County Sanitation District FROM: James D. Herberg, General Manager Originator: Lorenzo Tyner, Director of Finance &Administrative Services SUBJECT: DISASTER RECOVERY DATA CENTER FACILITY GENERAL MANAGER'S RECOMMENDATION A. Authorize a sole source agreement with Switch (SUPERNAP) for a disaster recovery data centerfacility beginning May 13, 2016 through May 12, 2019, for the total amount of$140,000; and B. Approve a contingency of$14,000 (10%). SUMMARY BACKGROUND In order to protect the Orange County Sanitation District (Sanitation District)from data loss in the event of disaster, the Information Technology (IT) Division has initiated efforts to replicate the critical systems and data to a location which exists outside of the natural disaster threat zone. To accomplish this goal, the Sanitation District must obtain the use of a data center facility which provides space, power, cooling and network capabilities with guarantees of security and reliability in the event of disaster in Southern California. This location will be used to store copies of the Sanitation District's critical systems and data. If a natural disaster were to occur which rendered the systems at Plant 1 and Plant 2 unusable, the Sanitation District could begin recovery procedures utilizing the systems and data maintained at this remote disaster recovery data center. RELEVANT STANDARDS . Maintain a culture of improving efficiency . 24/7/365 treatment plant reliability PROBLEM Currently the Sanitation District maintains no copies of data outside of Plant 1 and Plant 2. Due to the close proximity of these locations, the Sanitation District is currently at risk of complete data loss in the event of a local disaster. Page 1 of 2 PROPOSED SOLUTION After researching and visiting various data centers, our recommendation is to move forward with acquiring a service agreement with Switch (SUPERNAP) data center in Las Vegas, NV. This facility is geographically favorable as it is removed from the immediate disaster area of Plant 1 and Plant 2, but still close enough for Sanitation District employees to effectively maintain a remote copy of critical systems without enduring unnecessary travel time and expenses. Additionally, as a top-rated (Tier IV) data center, the Sanitation District's data is guaranteed to be available in the event of a disaster with regards to power, cooling, security and network capabilities. Furthermore, this service will provide a limited amount of office space from which select Sanitation District employees can work and access corporate data resources in the event of a disaster. Finally, this data center currently services several other public agencies, demonstrating superior reliability while providing these services at competitive rates in comparison with other data centers examined. In consideration of all of these factors, the data center is uniquely qualified to provide the Sanitation District with services necessary to operate its disaster recovery data center. As the Sanitation District is currently at risk of data loss were a disaster to occur, acquisition of this service is an immediate priority and should not be placed through the Sanitation District bidding process due to time constraints. TIMING CONCERNS Acquiring a disaster recovery data center should be accomplished as soon as possible to mitigate the risk of data loss in the event of a disaster affecting both Plant 1 and Plant 2. RAMIFICATIONS OF NOT TAKING ACTION The Sanitation District will remain exposed to the risk of data loss in the event of disaster if action is not taken. FINANCIAL CONSIDERATIONS This item has been budgeted in the established annual Joint Operating budget. ATTACHMENT The following attachment(s)may be viewed on-line at the OCSD website(www.ocsd.com) with the complete agenda package: • Colocation Facilities Agreement Page 2 of 2 is S U P E R N A P NO: COLOCATION FACILITIES AGREEMENT This Colocation Facilities Agreement is made by and between Switch packaging materials(especially flammable materials)associated with the and the customer indicated in the signature block below("Costume"). Customer Equipment and will maintain the Colocation Space in a clean, This Colocation Facilities Agreement is effective as of the date of safe and orderly fashion. Customer must adhere to industry standards for Switch's signature below(the"Effective Date");provided that neither cablemanagement. Cables most be properly installed and either enclosed party shall be bound until both parties have signed. in cable management trays or in clean bundles for proper presentation 1. Colocation Facilities. and identification. 2.3 Location and Configuration. The Colocation Space is 1.1 Definitions. "Agreement" meansacollective reference to teemed within a t-scif-as described on Exhibit B and Customer agrees this Colocation Facilities Agreement and Exhibits hereto. "Colocation to abide by the engineering standards inherent in such a structure, ace"means a collective reference to the Colocation space described including minimizing Customer's carbon footprint by working with on a Service Order together with associated power,cooling and other Switch to maintain a hot aisle temperature between 100-and 110'. The services to be provided by Switch pursuant to a Service Order standard cabinet height for the t-scif is 79 inches(421J). The standard (exclusive of Carver Services). "Carrier Services"meats a collective cabinet width for the t-scifis 24 inches wide(6 annual. All non-standard reference a internet,transport and other services provided by one or height cabinets may require a concentration fee for installation within a more third-party telecommunications carriers (each a "Carrier") to thermal-scif All non-standard width cabinets may require an increase to Customer through Switch or procured directly by Customer. MRC due to the increased space allocation. No cabinets above 90 inches "Customer Equipment' means the computer equipment, software, will heallowed. Modifications to the Customer Equipment configuration hardware and other materials placed by or for Customer in the tutu the Colocation Space require Switch's prior written consent. Colocation Space,other than Switch equipment Capitalized terms(e.g. the term"Premises")not defined herein have the meaning provided in 2.4 Customer Equipment. All Customer Equipment at be the SLA or the applicable Service Order. UL60950 compliant. The Colocation Space is not intended to provide 1.2 Service Orders. From time to time,the parties may execute the Special Requirements for an Information Technology Equipment Service Orders that reference this Agreement and this Agreement is Room as contemplated by ANSI/NFPA 70,Article 645 and NFPA 75, hereby incorporated into such Service Orders. This Agreement shall The Customer Equipment shall be listed and labeled under UL Standard 60950 or other standard reasonably acceptable to Switch. The Customer govern over any inconsistent terms and conditions contained in a Service Order. For clarity,each Service Order is a separate and distinct Equipment and its installation shall conform to the requirements agreement between Switch and Customer. contemplated by ANSI/NFPA 70,National Electric Code,Chapters I through 4. Customer shall not install Customer Equipment that requires 1.3 Commencement of License. The Colocation Space the additional safeguards contemplated by ANSI/NFPA 70,Article 645 commencement date(the"Commencement Date')shall be the earlier and NFPA 75. of (i)the date Switch makes the Colocation Space available to 2.5 Access. Customer will have access to the Colocation Space Customer(which shall not be prior to the Target Commencement Data) 24-hours a day,7-days a week. All access to the Premises shall be in or (ii)the date Customer places any Customer Equipment in the accordance with Switch's security and access procedures. Customer is Colocation Space. The Commencement Date for Carrier Services shall responsible for any and all actions of Customer's representatives, be the date on which the applicable Carrier makes the Carrier Services agents and persons escorted by or on behalf of Customer(collectively, available to Customer. "Customer Retimsenmtives'). Switch may suspend access by my 1.4 Installation Documentation. Within sixty (60)days after Customer Representative or other person to the Premises including the the execution of each Service Order, Customer will provide Switch Colocation Space for security violations or in the event ofou emergency. with all required installation documentation. If Customer fails to Switch shall promptly notify Customer in the event any such suspension provide such documentation within the 60-day period, Switch may occurs. Customer shall receive two access badges at no cost. Additional commence charging MRC(defined in Section 3)as a reservation fee, badges are available for$I00 each. 2. Colocation Space. 2.6 Smarthands Services. At Customer's request,Switch may assist Customer in performing light duties or connecting minor 2.1 License Grant. Starting on the applicable Commencement problems with respect to the Customer Equipment. Customer agrees Date, Switch hereby grants Customer a limited, revocable license to to pay Switch's fees for such services. install and operate,maintain and access,as well as transmit and receive to and from,the Customer Equipment within the Colocation Space and 2.7 Removal of Customer Equipment. Customer will provide for no other purpose. Switch with notice at least two (2) days before Customer desires to remove a significampiece of Customer Equipment from the Colocation 2.2 Installation and Management Customer will be solely Space so logistics may be arranged within the Premises. Before responsible for the immediate removal from the Premises of all authorizing the removal of any significant Customer Equipment, Switch Confidential Document:Intended for Designated Customer Only COWCATION FACILITIES AGREEMENT 04292015 1 Customer Initials Switch's accounting department will verify that Customer's account is Deposit')equal to one month's MRC or such other amount as may be in good standing. indicated on the Service Order, which will be promptly returned to 2.8 Vacating the Colocation Space. In the event Customer Customer upon expiation or termination ofthis Agreement or applied continues its presence in the Coloration Space after the termination er against the MRC then due. In the event Switch needs to utilize all or any part of the Security Deposit, Customer agrees to replenish the the applicable Service Order or this Agreement Customer agrees to be subject to all the terms and provisions of this Agreement during such Security Deposit within five business days. Switch will not have occupancy per and to pay for such space an amount equal to twice any obligation to perform under r any Service Order unless and until iod the MRC due for the period immediately preceding termination of the Switch receives the NEC and the Security Deposit. Service Order or this Agreement. No occupancy of the Colocation 3.3 Timing of Payment. Switch shall invoice Customer Space or payments of money by Customer after termination shall monthly for MRC in advance,and Customer shall pay such invoice on prevent Switch's immediate recovery of the Colocation Space. or before the first day of each month. MRC and any other sums not Customer shall indemnify,defend and hold harmless Switch from and paid within five(5)days after the first day of the month are subject to against any and all claims, actions, proceedings or demands (each a a late fee of five percent(5%ofthe amount due plus an interest charge "Claim")and related Costs(defined below)arising from or related to on the outstanding balance equal to the lower of one and one-half Customer's failure to timely vacate the Colocation Space. Upon percent (1.5%) per month or the maximum allowable rate under termination of the Agreement or any Service Order,Customer agrees applicable but. During the Service Commitment Period, MRC may to promptly release any Inters[Protocol (IP)numbers, addresses or increase by an amount not to exceed seven percent(7%)in any calendar address blocks assigned to Customer by Switch in connection with the year. Power MRC may increase an additional amount to Service (but not any URL or top-level domain or domain vane) and proportionately reflect increases in third-party utility charges. will assist Switch with any steps necessary to change or remove any such IP addresses. 3.4 Bankruptcy/Insolvency. If Customer fails to make any payments hereunder,or if a petition is brought by or against Customer 2.9 Relocation of Customer Equipment. Switch shall not order any state or federal insolvency law, Switch may modify the arbitrarily require Customer to relocate the Customer Equipment, payment terms to secure Customer's payment obligations before However,upon prior notice of at least thirty(30)days,or in the event of providing any services. Customer hereby grants Switch a security an emergency, Switch may require Customer to relocate the Customer interest in the Customer Equipment to secure Customer's obligations Equipment; provided that the relocation site shall afford comparable hereunder. Upon request Customer shall execute any documents environmental conditions for and accessibility to the Customer intended to perfect Switch's security interest Equipment. The reasonable direct costs of the relocation shall be borne by Switch unless the relocation is required to accommodate Customer's 3.5 Taxes. NRC and MRC are exclusive of applicable taxes, requests or the physical requirements ofthe premises. The Premiseswere duties and similar charges. Customer will be responsible for and will designed to meet Update Iodine's Tier 4 standards for power pay in full all such amounts (exclusive of income taxes payable by throughputs. If Customer requires power in excess of these thresholds, Switch),whether imposed on Switch or directly on Customer. then Customer shall comply with Switch's request to move Customer to 3.6 Service Credits. In the event of unavailability or failure of Switch's higher density power data center at no cost to Switch. the Colocation Space, Customer will receive Service Credits m set 2.I0Cross-Connectlons/Carrler Services. Upon request, forth in the Service Level Agreement ("SLA") attached hereto as Switch will provide Customer with a list of approved Carriers. Exhibit A. Customer acknowledges and agrees that Customer's sole Customer shall order all cross-connections from Switch. Such cross- and exclusive remedies regarding the Colocation Space are those connections are subject to Switch's processes and procedures. All provided in the SLA. cross-connections shall be installed by Switch. Customer will notify 4, Additional Responsibilities. the applicable Carrier and Switch when Customer desires to terminate or modify any cross-connections. Customer will be solely responsible 4.1 Customer Equipment. Customer has sole control and for all payments due to the Carriers unless the Carrier Services are responsibility for installation, testing and operation of the Customer made available to Customer by Switch,in which case payment shall be Equipment(including services not provided by Switch). In no event made to Switch. Customer acknowledges and agrees that the Carer will the untimely installation or nonoperation of Customer Equipment Services will be provided by one or more third-parry Carers that are (including Off-Net Local Access when procured by Customer)relieve not under the control of Switch. Customer understands that Switch Customer of its obligation to pay MRC. does not own or control any of the Carrier Services and agrees that 4.2 Customer's End Users. Customer is solely responsible for Switch is not responsible or liable for performance or non-performance providing its end users with commoner service. of the Carriers even when resold by Switch except that Switch shall pass through any service credits provided to Switch by a Carrier 4.3 Compliance with Law/AUP. Both Switch and Customer pursuant to the applicable Cartier service level agreement. shall at all times fully comply with and faithfully carry out all laws, statutes, ordinances, regulations, promulgations and mandates of all 3. Fees suit Billing. duly constituted authorities applicable to the operations of their 3.1 Recurring MRC. Customer agrees to pay the minimum respective businesses,and any failure to do so shall constitute a default Monthly Recurring Charges indicated on (be Service Order and all under this Agreement if not cured within the cure period set forth in other amounts indicated in this Agreement(cotlectively,the"MRC'). Section 5 in which event the affected portion ofthis Agreement may be immediately terminated by either party by written notice delivered 3.2 Non-Recurring Charges. Non-Recurring Charges prior to the effect of a cure. Both Switch and Customer shall at all indicated on a Service Order ("NRC") are due and payable upon times maintain in good standing and effect all necessary and proper execution of the Service Order by Switch. Along with the NRC, business licenses and other licenses and permits relating to its business Customer shall deliver to Switch a security deposit (the "Security operations. Customer acknowledges that Switch exercises no control Switch Confidential Document:Intended for Designated Customer Only COLOCAncox FACILITIES AOREEMmUr 04292015 2 Customer Initials over the content of the information passing through the Customer's restriction or suspension and will notify Customer promptly when such telecommunications network and that it is Customer's sole restriction or suspension is no longer necessary. Suspension of responsibility to ensure that the information Customer transmits and Colocation Space and/or Carrier Services pursuant to this Section 5 receives complies with all applicable laws and regulations. Customer shall not be a violation ofthis Agreement or contribute towards Service shall cooperate with any investigation by any governmental authority Credits. or Switch,and shall immediately rectify illegal use;failure to do so will 5.6 Effect of Termination. Upon termination ofthis Agreement: be a material breach of this Agreement. Customer's use of the Colocation Space and operations therein shall comply with Switch's (r)Switch may immediately cease providing services;and(i)all MRC and each applicable Carrier's then current Acceptable Use Policy(each will become immediately due and payable. In the event Customer has an "AILP'). Switch's AUP is available at cow .."ousn.corn not removed the Customer Equipment as of the tenainaton date, Transmission of any material in violation of any law,regulation or m Switch may remove the Customer Equipment from the Colocation AUP is strictly prohibited. Any access made to other networks Space and place the Customer Equipment in storage at Customer's risk connected to the Switch Network most comply with the rules of the and expense and/or,after providing Customer with at least fifteen(15) other network and the AUP. days'notice,dispose of the Customer Equipment. 5. Term and Termination. 6. Resale. Customer may sub-license the Colocation Space only after receiving Switch's prior written approval. Should Customer sub- 5.1 Term. This Agreement is effective as of the Effective Date license any portion of the Colocation Space to any third party, and shall remain in effect until expiration of the last Service Order Customer assumes all liabilities arising out of or related to use of the issued hereunder unless terminated earlier as set forth in this Section 5. Colocation Space by such third party and Switch shall have no The Service Commitment Period for a Service Order starts on the obligation in liability to such sub-licensee. Customer agrees to enter Commencement Date. Service Orders shall remain in effect for the into written agreements with all parties to whom Customer resells any Service Commitment Period, unless terminated earlier as set forth in portion ofthe Colocation Space with terms at least as restrictive and as this Section 5. After conclusion of the Service Commitment Period, protective of Switch's rights as the terms of this Agreement;provided each Service Order shall automatically renew on a month-w-month that such third party shall not have the right to harbor sub-license the basis unless anew Service Commitment Period is established;provided Colocation Space. Sub-licensing by Customer of any or all of the that cancellation of Carrier Services requires notice of at least 45 days. Colocation Space shall not relieve or in any way diminish Customer's 5.2 Conditions of Breach. A party is in breach of this liability and obligations hereunder. Agreement if such party violates its obligations under this Agreement 7. Insurance. At all times each party shall maintain(i)commercial and such violation is not cured within thirty(30)days after notice by general liability insurance of not less than$1,000,000 per occurrence the other parry(excepting payment obligations that are breached ifnot and (ii)workers' compensation insurance at or greater than the paid on the due date specified in Section 3.3). minimum levels required by applicable law; Customer shall also 5.3 Certain Remedies for Breach. If Crammer is in breach of maintain(a)"all risk"personal property insurance in an amount at least equal to the full replacement value of the Customer Equipment and this Agreement, Switch may discontinue providing any or all of the ro m )business loss and interruption insance in an amount sufficient to services, Colocation Space, Cartier Services and deny access to the compensate Customer and Customer's end users for loss of the Premises. Customer agrees to pay the expenses Switch may incur in Colocation Space related services or the Carrier Services. Customer collection efforts including any—reasonable attomeys' fees. retains the risk of loss for,loss of(including loss ofuse),or damage to, Additionally,Switch reserves its rights in law and in equity,including the Customer Equipment and other personal property located in the the ability to collect the MRC for the balance of the Service Premises. Switch's insurance policies do not provide coverage for Commitment Period. If Switch is in breach of this Agreement,then Customer's personal property. Customer agrees that Customer shall prior to the cure of such breach,Customer may terminate the breached not and shall cause the Customer Representatives to not pursue any Service Order at no penalty and pay only the MRC for such services Claims against Switch unless and until Customer, or the Customer through the termination date. Representative, as applicable, first files a claim against Customer's 5.4 Service Commitment Period. Subject to Section 5.2 and insurance policy and the applicable insurance providers) finally 5.3, Service Orders are non-cancellable during the Service resolve such claims. Customer shall name Switch as an additional Commitment Period. As a material inducement for Switch to enter into insured on all general liability insurance policies,such policies may not this Agreement and each Service Order, Customer acknowledges, be cancelled without thirty (30) days prior notice to Switch and agrees and covenants that upon Customer's execution of each service Customer shall provide policy endorsements upon request. Customer order(i)Customer is responsible for full payment of the license for the shall ensure that each policy required hereunder contains a waiver of entire Service Commitment Period regardless of the portion of the subrogation provision for the benefit of Switch. services actually consumed;and(ii)termination of the Service Order S. Limitations of Liability. or this Agreemeat(other than for breach by Switch)or auspension of services as permitted in this Agreement shall not relieve Customer of 8.1 Personal Injury. Each Customer Representative and any its obligation to pay the full MRC for the duration of Service other person visiting the Premises does so at his or her own risk, and Commitment Period(subject to any applicable Service Credits). Switch shall not be liable for any harm to such persons. 5.5 Network Protection. In the event of an emergency and to 8.2 Liability. IN NO EVENT SHALL EITHER PARTY BE the extent necessary to protect the Switch Network or to remedy AUP LIABLE TO THE OTHER, OR ANY CUSTOMER violations, Switch may temporarily restrict or suspend Customer's REPRESENTATIVE,ANY THIRD PARTY OR OTHERWISE,FOR rights trader this Agreement,including access to the Colocation Space, ANY INCIDENTAL, SPECIAL, PUNITIVE, INDIRECT OR related services and Cartier Services, without liability to Customer. CONSEQUENTIAL DAMAGES, INCLUDING LOST REVENUE, Switch will use reasonable efforts to notify Customer prior to any such LOST PROFITS, DAMAGE TO CUSTOMER EQUIPMENT, LOSS Switch Confidential Document:Intended for Designated Customer Only COWCATION FACILITIES AGREEMLM 04292015 3 Customer Initials OF TECHNOLOGY, LOSS OF DATA,NON-DELIVERIES, OR IN Agreement due to any cause beyond its reasonable control, including ANY WAY RELATED TO THE COLOCATION SPACE,SERVICES acts of war, acts of God, earthquake, flood, embargo, riot, sabotage, OR ANY ASPECT OF CUSTOMER'S BUSINESS, EVEN IF labor shortage or dispute,loss ofthe Premises(in whole or part)for any ADVISED OF THE POSSIBILITY OF SUCH DAMAGES, reason,governmental act or failure of the Cartier or the Internet. WHETHER UNDER THEORY OF CONTRACT, TORT (INCLUDING NEGLIGENCE), STRICT LIABILITY OR 112 No Lease. Customer acknowledges and agrees that OTHERWISE. IN NO EVENT WILL EITHER PARTY'S Customer has not been granted any real property interest in the AGGREGATE LIABILITY ARISING FROM OR RELATED TO Colocation Space or the Premises, and Customer has no rights as a THIS AGREEMENT UNDER ANY THEORY OF LIABILITY tenant or otherwise under any real property or la¢dlord/tenant laws or EXCEED THE AMOUNT INVOICED AND,IN SWITCH'S CASE, regulations. Customer shall not record any notice of this Agreement. PAID BY CUSTOMER FOR THE COLOCATION SPACE WHICH Customer shall not permit any liens to be placed on the Premises or IS THE SUBJECT OF THE DISPUTE IN THE SIX (6)MONTHS portion thersofand shall have any such liens immediately removed. IMMEDIATELY PRECEDING THE DATE ON WHICH THE 11.3 Confidentiality. The parties acknowledge and agree(i)that SUBJECT CLAIM AROSE. THESE LIMITATIONS SHALL - the APPLY DESPITE THE FAILURE OF THE ESSENTIAL PURPOSE technical aspects of Customer's deployment in the Colocation Space is OF ANY REMEDY. THE PROVISIONS OF THIS SECTION the confidential information of Customer and (hi)the design of the SHALL NOT APPLY TO INDEMNITY OBLIGATIONS OR BE premises and the manner by which Switch provides the Colocation INTERPRETED TO REDUCE COMPENSATION WHICH IS Space and access to Carrier Services are the confidential information OTHERWISE DUE TO SWITCH. of Switch (collectively, "Confidential Infommtion"). Confidential 9. Indemnification. Customer agrees and covenants to defend, Information may be used by the recipient only in connection with its indemnify and hold harmless Switch,its directors,officers,managers, performance under this Agreement. Confidential Information may not members, employees, agents, affiliates and customers (collectively be disclosed except to those employees or contractors of the recipient with Switch,the"Covered Entities")for,from and against any and all with a need to know and who agree to hold the information in costs,expenses, damages,losses and/or liabilities(including attorney confidence. If the recipient is legally compelled to disclose fees)(collectively,"Costs")arising from or related to Claims made by Confidential Information,the recipient shall provide the discloser with or against an of the Covered Entities alleging: r infringement or notice of such requirement prior to disclosure(if permissible)so that g y g g' (� g the discloser may seek any appropriate remedy. Confidential misappropriation ofany intellectual property rights;(fi)damage caned Info by or related to Customer's operations, including my violation of Information excludes information that (i)is or becomes generally Switch's or any Carrier's AUP(including anti-spam policies);(iii)any available to the public through no wrongfulact of the recipient;(if is damage or destruction to the Colocation Space,the Premises, Switch received from a third party with the right to supply it; or (ui)is equipment or to another Switch customer which damage is caused by independently developed by the recipient. Upon written request,the or results from acts or omission by Customer or my Customer recipient will return the Confidential Information to the discloser and Representative; (iv)any property damage or personal injury to any shall not retain any copies of such Confidential Information. The Customer Representative arising out of such individual's activities at parties acknowledge and agree that Switch does not require access to the Premises;(v)any damage arising from or related to the Customer coy Confidential Information (including end customer information) Equipment or Customer's business;or(vi)my warranties provided by which may be located on the Customer Equipment. Switch covenants or through Customer to any third parties regarding the Colocation not to attempt to access any infonntion on the Customer Equipment Space or the Carrier Services(collectively,the"Covered Claims'). In without the prior written consent of Customer and Customer covenants the event of a Covered Claim,the Covered Entity may select its own not to provide Switch with access to such information without the prior counsel to participate in the defense of such Claim. Customer will net wit.a an consent of Switch. settle a Covered Claim in a manner that imposes liability or obligation 11.4 Assignment. Neither party may assign this Agreement upon a Covered Entity. without the prior written consent of the other party,except m part of a 10. Hazardous Materials. "Hazardous Materials" means any merger, acquisition or financing. Any attempted assignment in substance referred to,or defined in any law,as a hazardous material or violation ofthis Section 11 will be null and void. This Agreement will Incautious substance(or other similar term). Customer will not cause bind and inure to the benefit of each parry's permitted succssom and or permit any Hazardous Materials to be brought upon, kept, stored, assigns. Successors and assigns shall assume the assignor's obligations discharged, released or used in, under or about my portion of the hereunder in a writing satisfactory to the non-assigning party. Premises. Customer will cause all Hazardous Materials brought to the 11.5 Notices. Any notice or communication given hereunder may Premises by or on behalf of Customer to be removed from the Premises be delivered personally,by electronic mail(other than notices ofbreach in compliance with all applicable laws. If Customer or its agents or termination), deposited with an overnight courier or mailed by perform my act or omission that contaminates or expands the scope of registered mail,return receipt requested,postage prepaid,to the address contamination of the Premises, then Customer will promptly, at of the receiving party indicated on the Service Order,or at such other Customer's expense, take all investigatory and remedial actions address as either party may provide to the other. Notices will be necessaryto fully remove and dispose ofsuch Hazardous Materials and deemed delivered upon receipt. any contamination so caused in compliance with all applicable laws. Customer will also repair all damage to the Premises caused by such 11.6 No Waiver. No term or provision alibis Agreement shall be contamination and remediation. deemed waived nd no breach or default shall be deemed excused unless such waiver or consent is in writing and signed by the parties. 11. Miscellaneous Provisions. A consent o waiver of or excuse for a breach or default by either party, 11.1 Force Majeure. Except for the payment of money,neither whether express or implied,shall not constitute a cogent to,waiver of, party will be liable for my failure or delay in its performance under this or excuse for my different or subsequent breach or default. Switch Confidential Document:Intended for Designated Customer Only CowcATION FACILITIES ACREEMENr 04292015 4 Customer Initials 11.7 Relationship of Parties. Switch and Customer are INCLUDING THE IMPLIED WARRANTIES OF FITNESS FOR A independent contractors and this Agreement does not establish any PARTICULAR PURPOSE, OF MERCHANTABILITY AND relationship of partnership,joint venue, employment, franchise or AGAINST INFRINGEMENT, SWITCH EXERCISES NO agency between Switch and Customer. Neither Switch nor Customer CONTROL WHATSOEVER OVER THE CONTENT OF THE will have the power to bind the other or incur obligations on the other's INFORMATION PASSING THROUGH THE SWITCH NETWORK behalf without the other's prior written consent. OR OVER THE INTERNET. USE OF ANY INFORMATION 11.8 Choler of Law. This Agreement shall be consumed or OBTAINED OVER THE SWITCH NETWORK OR THE INTERNET accordance with and all disputes hereunder shall be governed by the IS AT CUSTOMER'S OWN RISK. laws of the State of Nevada,excluding its conflict of law rates and the 11.12 Hein ings/Interprelation. Headings in this Agreement parties hereby consent to the exclusive jurisdiction of the state and are for reference purposes only and in no way define,limit,or describe federal routs located in and for the County of Clark,Nevada. the scope or extent of a Section or in any way affect this Agreement. 11.9 Entire Agreement. This Agreement represents ihecomplete The word"including'shall be read as"including without limitation." agreement of[he parties with respect to the subject maser herein,and No prevision of this Agreement shall be consumed against or o supersedes any other agreement or understanding,written or oral. This interpreted to the disadvantage of any party by any court other Agreement may be modified only through a written instrument signed authority by reason of such party having or being deemed t to have by both parties. There are no third-party beneficiaries to this drafted such provision. Agreement. Except as expressly staled herein,all rights and remedies 11.13 Survival. The provisions of Sections 2.8,3.3,5.6,8,9,10 herein are cumulative and without prejudice to each other or any other and 11 shall survive the expiration or termination of this Agreement for remedies available in law or equity. any reason,along with all indemnity obligations hereunder. 11.10 Severability. In the event any provision of this 11.14 Confirmation. Periodically,an entity with whom Switch Agreement is held by a court or other tribunal ofcompeterajurisdiction has a finaaclal relationship(Such as a lender)may request confirmation to be unenforceable,that provision will be reformed and enforced to from Customer that this Agreement is in existence,that it is then in the maximum extent permissible under applicable law, and the other force, that Switch is not in breach of this Agreement and similar provisions of this Agreement will remain in full force and effect. information (a "Confirmation"). Within ten (10) days after request 1 Ll l Warranties. Both parties represent and wammt that they from Switch, Customer will execute and deliver inSwitch a Confirmation in the form reasonably requested by the third party or a have full corporate power and authority to execute and deliver this description ofwhy the requested statements in the Confirmation are not Agreement and in perform their obligations under this Agreement and accurate. the person whose signature appears on the Service Order is authorized to enter into this Agreement on behalf of the respective party. The 11.15 Counterparts. This Agreement may be executed in Coloration Space itself is provided on an"AS-IS"basis. EXCEPT AS counterparts with the same force and effect as if each parry had SET FORTH IN THIS SECTION AND THE SLA, SWITCH executed the same instrument,provided that no party shall be bound SPECIFICALLY DISCLAIMS ANY AND ALL EXPRESS, until both parties have executed and delivered a counterpart of this IMPLIED OR STATUTORY WARRANTIES WITH RESPECT TO Agreement to the other. THE COLOCATION SPACE, SERVICES AND THE PREMISES, WHEREFORE, intending in be bound, the parties have executed this Colocation Facilities Agreement through their authorized representative as of the dates set forth below. SWITCH Signature: Signature: Name: Name: Title: Title: Date: Date: Address: 7135 S.Decatur Blvd Address: Las Vegas,NV 89118 Switch Confidential Document:Intended for Designated Customer Only COWCAroui FACILITIES AOREEMHNf 04292015 5 Customer Initials S U P E R N A P Exhibit "A" SERVICE LEVEL AGREEMENT This Service Level Agreement is a part of the Colocation Facilities Agreement(the"Agreement")between Cusomer and Switch.Capitalized terms not defined herein have the meaning provided in the Agreement. I. Service Credits Switch is pleased to offer Customer the following service levels regarding the following items: • Network Availability • Network Latency • Packet Delivery • Power Delivery If Switch fails to meet any of these service levels,Switch will provide Customer with a service credit(a"Service Credit"),equal to the result of dividing(i)the MRC paid by Customer for the affected service during the calendar month in which the Service Credit was earned by(ii)30 (the average number ofdays in a calendar month). "Network Access Fees"ave the fees charged to Customer for access to and use ofthe Switch Network. "Switch Network" means the telecommunications/data communications network and network components owned,operated and controlled by Swimb within the Premises. The Switch Network does not include any Customer Equipment or any networks or network equipment not operated and controlled by Switch. 2. Switch Network Availability Switch provides 99.99%availability ofthe Switch Network in any calendar month,m calculated from the ingress in and egress from the Switch Network. For each cumulative horn or fraction thereof that Customer experiences Switch Network unavailability, Customer may request Service Credits. A Network Service Credit will be given only for those outages that were reported to Switch at the time of the outage. An outage is measured from the time it is reported to the time it is resolved. 3. Switch Network Latency The Switch Network carries packets with an average Network Latency per month of less than 10 milliseconds. Switch monitors aggregate latency within the Switch Network by monitoring round trip times between a sample ofbackbone hubs on an ongoing basis. "Network Latency' (or hound trip time'j means the average time taken for an IP packet to make a round trip between specified backbone hubs on the Switch Network. After Customer notifies Switch of average Network Latency in excess of]0 milliseconds per month,Switch will use commercially reasonable efforts to determine the source of such excess Network Latency and to correct such problem to the extent that the source ofthe problem is on the Switch Network. If Switch fails to remedy such Network Latency on the Switch Network within 24 hours of being notified of any excess Network Latency and the average Network Latency for the preceding month has exceeded 10 milliseconds,Switch will issue Service Credits to Cusomer's account for each hour or fraction thereof from time of notification by Customer until the Network Latency is less than 10 milliseconds. 4. Switch Network Packet Delivery The Switch Network has an average monthly Packet Loss of 0.1%(or successful delivery of 99.9%ofpackets). Switch moniors aggregate Packet Loss within the Switch Network on an ongoing basis and compiles the collected data into a monthly average Packet Loss measurement for the Switch Network. "Packet Loss"means the percentage of packets that are dropped within the Switch Network. After being notified by Customer of Packet Loss in excess of 0.1% in a given calendar month ("Excess Packet Loss"), Switch will use commercially reasonable efforts to determine the source of such Excess Packet Loss and to correct such problem to the extent that the source of the problem ism the Switch Network. If Switch fails to remedy such Excess Packet Loss within 24 hours of being notified of any Excess Packet Loss on the Switch Network and average Packet Loss for the preceding month exceeds 0.1%, Switch will issue Service Credits to Customer's account for the period commencing at the time of receipt notification from Customer until the Packet Loss is less than 0.1%. Switch Confidential Document:Intended for Designated Customer Only SER V ICE LEVEL AGREEMENT CowcAnoN FACILITIES AGuiioo T Customer Initials 04292015 A-1 5. Power Service Availability Switch is committed to providing 100%power availability if,and only if,Customer elects to properly deploy dual feed(A&B)power. Switch strongly recommends dual power and monitor-ready ATS and PDU's be correctly deployed in every rack and cabinet to ensure 100%uptime. Customer Equipment not properly utilizing A&B power will not receive Service Credits for power loss("Power Service Credits"). Customer UPS's are not allowed to be used down-line from the Switch mission critical power system. Switch Operations most approve all power distribution systems deployed within the Customer's Colocation Space. All equipment most first be tested on house power prior to plugging into the Switch UPS receptacles. For each hour or fraction thereofthat Customer experiences both A&B power unavailability,Customer may request Service Credits for the cabinets experiencing the power loss from Switch. A Power Service Credit will be given only for those interruptions that were reported to Switch at the time ofthe interruption. If Customer only has single-sided power,Customer will not receive Power Service Credits. Customer most perform fail-over testing procedures at least twice each year to ensure all Customer Equipment will function properly in the urdikely event of a single sided power interruption. This is for the Customer's protection. Failure to perform this testing could result in forfeiture of Power Service Credits. 6. Environmental Guarantee. Switch guarantees the temperature and relative humidity in the cold aisle of the Colocation Space will be maintained within ASHRAE thresholds,as measured by Switch,excluding events caused by Customer. Customer may request a Colocation Space Service Credit for each 15 minutes in which these environmental thresholds are exceeded. 7. Measured Bandwidth Service Billing Methodology. The concept behind offering a usage based Internet product is simple:charge the customer for what they actually use. This product is ideal for those customers that either experience substantial swings in monthly usage or are anticipating growth. When traffic patterns will be unpredictable,the customer can have the security ofhaving enough bandwidth to handle heavy use months,but also retain the flexibility to pay less when traffic declines. Customer's monthly burstable usage is determined by calculating the 951^percentile of data usage that is used over and above Customer's contracted floor amount. As is with most data, Internet traffic has peak times throughout the day. Actually, it has peak times within any measurement interval whether it be a day,an hour,or five minutes. Billing on the 95"percentile eliminates the top 5%ofineamo ment peaks, and bills on the Mb level at the remaining highest measurement The purpose for billing at the 95a percentile versus actual peak utilization is to eliminate any abnormal peaks throughout the month. Within the router,a counter that keeps track of all bytes passed through each interface,a PERIL script using SNMP will poll each applicable Customer interface every five minutes. At every five minute pass,the code will read the counter and compare the result against the previous reading. The difference between the two will be converted from byte counts to a data rate.Polling this data every five minutes results in 8640 data records per month. These records are then sorted from high to low usage and the top 5%are discarded. The remaining data rate is then used to determine the billing level for the month. For example,out of 100 data points the top ten are: 100.......34.2 Mb 97_.........34.08 Mb 94..........33.91 Mb 91..........33.66 hob 99..........34.18 Mb 96...........34.02 Mb 93..........33.84 Mb 98_........34.11 h16 95 .........33.98 Mb 92..........33.70 Mb Eliminating the top 5%leaves the data rate of 33.98Mb. This is the rate at which Switch will bill Customer for the month. 8. Conditions. This SLA provides Customer's sole and exclusive remedies for any service interruptions,deficiencies or failures of any kind. The parties agree that the Service Credits constitute liquidated damages. No Service Credits shall be issued for Exempted Occurrences. "Exempted Occurrence" means any occurrence which impacts a service that is caused by: (i)any suspension of service pursuant to the Agreement;(ii)scheduled or emergency maintenance,alteration or implementation;(in)home majeure events;(iv)theunavailability ofnecessary Customer Representatives, including as a result of failure to provide Switch with accurate, current contact information; (v)the acts or omissions of Customer or any Customer Representafive; or (vi)failure or malfunction of equipment, applications or systems not owned or controlled by Switch. All performance measurements for the determination of Service Credits are based upon Switch's records. The parties acknowledge and agree that Switch manages traffic on the Switch Network on the basis wits customers'utilization of the Switch Network and that changes in such utilization impact Switch's ability to manage network traffic. Therefore,notwithstanding any provision to the contrary herein or in the Agreement,if Customer significantly changes its utilization of the Switch Network and such change creates a material and adverse effect on the traffic balance ofthe Switch Network,Switch may either modify the Service Credits that mayhave otherwise accrued or modify Switch's provision ofthe affected services. Customer most request any credit due hereunder within 60 days after the date on which the credit accrues. Customer waives any right to credits not requested within this 60 day period. Customer will not be eligible to accrue any otherwise applicable Service Credits while Customer is: (i)past due on MRC or other amounts owed under the Agreement or(it)in violation of an AUP. In no event shall Service Credits exceed 50% of the MRC for the affected service(s)during the calendar month in which the Service Credits accrue. Switch Confidential Document:Intended for Designated Customer Only SER V ICE LEVEL AGREEMENT COwcArwN FAGLITIE6 AGREEMENT Customer Initials 04292015 A-2 Exhibit `B" T-SCIFFm DESCRIPTION All computerized equipment generates heat. The Switch t-scifT"is designed to protect all of the customers in the facility from heat outputs. All equipment placed into the t-scif must vent the heat directly into the enclosed center aisle,where it is then contained and prevented from mixing back into the cold room. Switch Confidential Document:Intended for Designated Customer Only T-SCIF DESCRIPTION CowCArmN FACatTtes AnaEEMDT Customer Initials 04292015 B-1 ADMINISTRATION COMMITTEE Meeting Date To Bd.of Dir. 04,13,16 — AGENDA REPORT Item Number hem Number 6 — Orange County Sanitation District FROM: James D. Herberg, General Manager Originator: Celia Chandler, Director of Human Resources SUBJECT: STATUS OF 2016-17 PROPERTY-LIABILITY INSURANCE RENEWALS GENERAL MANAGER'S RECOMMENDATION Information Only. SUMMARY BACKGROUND Historically, the Administration Committee has asked for status updates regarding the renewals of major insurance policies each year. The Risk Management Division and the Orange County Sanitation District's (Sanitation District) 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 five 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 5) Earthquake Insurance The information in this report is supplemented by the insurance broker's update report which is attached. RELEVANT STANDARDS Protection of the Orange County Sanitation District's assets TIMING CONCERNS • Current insurance expires June 30, 2016 Page 1 of 4 RAMIFICATIONS OF NOT TAKING ACTION None at this time because this is informational only. However, action must be taken before June 30, 2016 or the Sanitation District's insurance will lapse. PRIOR COMMITTEE/BOARD ACTIONS May 2015 — The Board approved renewal of the above four policies for the period July 1, 2015 through June 30, 2016. 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. This program currently provides the Sanitation District with a $40 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 $40 million coverage has a self-insured deductible of $500,000. Since 1997, the Employment Practices portion of coverage has been enhanced from a $2 million sub-limit to the full policy limit. The actual insurance coverage currently consists of three separate layers. The first layer is the "Basic" $10 million program with self-insured retention of $500,000. The second layer consists of $20 million of coverage in excess of the first layer of $10 million. The third layer is $10 million of coverage in excess of the second layer. The premium for 2015-16 for the three layers was $384,080. 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 $1,000,000. The deductible was increased to $1,000,000 from $750,000 in 2015. 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. Page 2 of 4 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, 2015 through June 30, 2016 was at an estimated premium of $195,000 based on the estimated 2015-16 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. 3) All-Risk Property and Flood Insurance The All-Risk Property and Flood Insurance Program (Property Insurance) provides for comprehensive coverage for much of the Sanitation District's real and personal property regarding virtually all perils including fire, flood, and business interruption. 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 (excluding Boiler & Machinery) for the period July 1, 2015 through June 30, 2016 was at a premium of $662,539.10. 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. Page 3 of 4 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, 2014 through June 30, 2015 was at $23,667. 5) Earthquake Insurance The Sanitation District previously carried earthquake insurance as part of its Property Insurance, but in the last 15 years earthquake insurance was impossible to obtain or not cost-effective. The Sanitation District asked its insurance broker each year to survey the market to see if rates have changed. Finally, in 2015 a plan was created to insure seven key District structures identified by Engineering, thus keeping the cost in line. The insurance has a high deductible and a limit of $25 million in total. The cost of the Earthquake Insurance for 2015-16 is $80,471.23. CEQA N/A FINANCIAL CONSIDERATIONS N/A ATTACHMENT The following attachment(s) are included in hard copy and may also be viewed on-line at the OCSD website (www.ocsd.com) with the complete agenda package: Letter of Update from Alliant Insurance Services Page 4 of 4 44lliant DRIVER SPECIALTY GROUP March 23, 2016 Mr. Randall Kleinman Orange County Sanitation District 10844 Ellis Avenue Fountain Valley, CA 92708 2016-2017 Insurance Renewal Budgeting Dear Randy: We are midstream in the 2016 renewal process with discussions occurring with OCSD's insurance carriers and other markets for the forthcoming coverage year. While it is too early to have exact renewal costs, we can say that outside of the workers' compensation arena, which we discuss below, the insurance market is trending favorably. Therefore, aside from any market shocks, or significant changes in OCSD's operations, we feel comfortable with the following cost projections: Dollar Excess Liability 2015 2016 Change % Change Limit 40,000,000 40,000,000 - - SIR 500k/500k 500k/500k - - Total Premium 383,755 402,943 19,188 5% Excess Workers' Comp Payroll 63,083,100 65,659,233 2,576,133 4.5% Limit Statutory Statutory - - Rate Per$100 0.3091 0.3685 - 19.5% SIR 1,000,000 1,000,000 Premium 195,000 218,000 23,000 11.7% Property Incl.B&AP Values 1,864,845,724 1,918,816,652 53,970,928 3% Rate Per$100 0.038 0.040 5% Premium 705,186 761,875 56,689 8% Earthquake Values 61,216,088 61,931,687 715,599 10 Rate Per$100 0.131 0.131 Premium 1 80,471 81,131 1 659 1% Total Premium 1 1,364,412 1,463,949 1 99,536 7% Alliant Insurance Services,Inc.• 100 Pine Street, 11�Floor•San Francisco,CA 94111 PHONE(415)403-1400•w .alliantinsuance.conn•License No.OC36861 44/liant DRIVER SPECIALTY GROUP Mr. Randall Kleinman March 23, 2016 Page 2 What is most noticeable in the table above is the increase projected, for the Excess Workers Compensation coverage. As you are aware, the District participates in the California State Association of Counties Excess Insurance Authority. The Authority (or EIA) releases a series of premium estimates throughout pre-renewal cycle. Initial figures are always presented in a range, which from their previously distributed December 2015 notice, was a range of $217,000 to $242,000. We have subsequently received the March update where the EIA is projecting a cost at the bottom end of that range at $218,000. Further, as we have done in the past, we plan to shop the District's excess workers compensation program in the open market to develop alternative options. The property and excess liability markets remain stable with little in the way of rate change anticipated. On the property, the District's values show an increase of 3% over the prior period resulting from a recent trending process. We can discuss this if this is a matter of concern. Our team is working now to assure that this figure is most accurate. On General Liability,we are projecting a 5% increase simply as a conservative measure. We are hopeful the market will remain favorable. Of note, last year, the District reviewed three options for adjusting the Self Insured Retentions (SIR) on the program. We are happy to present such options again if need be. On a very positive note, the Earthquake market remains aggressive, and we are cautiously optimistic that a decrease may be achieved. Again however, we want to err to the conservative, so would ask you to budget"flat" for this coverage. If the District is pleased with the coverage, this could be a good time to consider expanding the program to cover more key locations. As always, we look forward to discussing the programs and the renewal strategy in more detail with you, and appreciate the opportunity to be of service to the District. V4ul DS(4t dmulaueenevl7alliant.com Alliant Insurance Services,Inc.• 100 Pine Street, 11�Floor•San Francisco,CA 94111 PHONE(415)403-1400•w .alliantinsuance.com•License No.OC36861 ADMINISTRATION COMMITTEE Meeting Date To ad.of Dir. 04,13,16 -- AGENDA REPORT am Number Item Number Orange County Sanitation District FROM: James D. Herberg, General Manager Originator: Lorenzo Tyner, Director of Finance &Administrative Services SUBJECT: FY 2016-17 AND FY 2017-18 BUDGET UPDATE GENERAL MANAGER'S RECOMMENDATION Information Only. SUMMARY BACKGROUND Discussion of the Orange County Sanitation District (Sanitation District) FY 2016-17 and 2017-18 Budget was initiated at the February 10, 2016 Administration Committee meeting. Additional materials are now being provided to further this discussion (attached). Included in the materials are line-item expenditure details for the Operating Budget. The proposed budget will be presented for adoption at the June 22, 2016 Board meeting. Staff will make a brief presentation at the Committee meeting. RELEVANT STANDARDS Produce Operations and CIP budgets every two years with annual update PROBLEM Lack of understanding of the Sanitation District's resources, or revenues and reserves, makes it difficult to approve a budget that meets the current needs of the District, lays the groundwork for future budgets, and keeps the District in sound financial condition. PROPOSED SOLUTION Providing the Board of Directors with an understanding of the Districts resources will assist in the approval of the proposed two-year budget. TIMING CONCERNS The proposed two-year budget, effective July 1st of this year, will be finalized and presented to the Board for adoption in June. Page 1 of 2 RAMIFICATIONS OF NOT TAKING ACTION Being an informational item, no action is requested at this time. ATTACHMENT The following attachment(s)are included in hard copy and may also be viewed on-line at the OCSD website (www.ocsd.conf with the complete agenda package: • FY 2016-17 and 2017-18 Budget Summary • FY 2016-17 and 2017-18 Budget Development-Additional Detail Page 2 of 2 2016-17 and 2017-18 Budget Development- Expenditure Summary (in millions) 2015-16 2015-16 2016-17 2017-18 Description Budget Projected Proposed Proposed 1 Salaries&Wages $66.3 $63.1 $66.8 $67.6 2 Benefits 28.5 26.8 22.5 23.0 3 Operating Materials& Supplies 17.2 16.4 16.7 17.4 4 Contractual Services 23.9 23.5 24.8 22.6 5 Repairs& Maintenance 12.4 13.4 14.2 16.1 6 Utilities 7.8 8.5 8.9 10.2 7 Professional Services 3.5 3.0 4.2 4.2 8 Other Operating Supplies 1.7 1.6 2.2 2.6 9 Administrative Expenses 1.6 1.5 1.8 1.9 10 Research & Monitoring 0.8 0.7 0.8 0.9 11 Other Non-Operating Expenses 1.0 0.1 1.2 1.2 12 Training & Meetings 1.1 0.8 1.2 1.2 13 Printing & Publication 0.4 0.3 0.3 0.4 14 Cost Allocation (16.9) (18.3) (19.2) (19.4) Net Operating Requirements $149.3 $141.4 $146.4 $149.9 2016-17 AND 2017-18 BUDGET DEVELOPMENT - ADDITIONAL DETAIL (in millions unless otherwise noted) Projected Proposed Proposed 2015-16 2016-17 2017-18 1) SALARIES AND WAGES $63.1 $66.8 $67.6 1a) Salaries $59.2 $62.7 $63.4 Salaries for 627 full-time equivalent (FTE) positions are shown for the FY 2016-17 and FY 2017-18 proposed budgets and 624 FTE's for the FY 2015-16 projected budget. Salary increases have only been included per existing bargaining agreements. The Vacancy Factor is projected at five percent based on the volume of recent and near- future retirements, and the time it will take to become fully staffed. 1 b) Leave Payoffs $ 2.5 $ 2.6 $ 2.7 Leave Payoffs for retirements are anticipated to remain relatively constant for the next two years. 1c) Overtime $ 1.4 $ 1.5 $ 1.5 Overtime has remained constant at approximately $1.5 million over the last several years. Of this total, approximately $1.3 million is budgeted in Operations and Maintenance primarily for required overtime as the plants are in operation 2417 (vacation, sick, shift overlap), emergencies, unscheduled maintenance, backlog and off- shift construction support. The remaining $200,000 is budgeted in other divisions and also has remained essentially flat. 2) BENEFITS $26.8 $22.5 $23.0 2a) Retirement $15.5 $11.0 $11.1 District employees are members of the Orange County Employees' Retirement System (OCERS). As a result of paying down the Unfunded Actuarial Accrued Liability (UAAL), the employer's required contribution rate has decreased from 20.75 percent (FY 2015- 16) to 13.16 percent (FY 2016-17). 2b) Group Insurance $ 9.2 $ 9.7 $ 10.2 Includes Medical, Dental, Vision, Life Insurance, Medicare, Disability. 2c) Benefits, Other $ 2.1 $ 1.8 $ 1.7 Includes Workers' Compensation, Tuition Reimbursement, Development Pay and Uniform Rental. Workers' Compensation ($1.2 million in FY 2016-17 and $1.1 million in FY 2017-18) 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 2016-17 AND 2017-18 BUDGET DEVELOPMENT - ADDITIONAL DETAIL (in millions unless otherwise noted) Projected Proposed Proposed 2015-16 2016-17 2017-18 3) OPERATING MAT'LS & SUPPLIES $16.4 $16.7 $17.4 3a) Chemical Coagulants $ 6.0 $ 5.1 $ 5.4 Anionic Polymer - Anionic polymer is added to the primary clarifiers in combination with ferric chloride to enhance primary clarifier performance. The projected budget for FY 2016-17 is $387,000 with FY2017-18 increasing to $398,000 due to an 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. Costs have increased at Plant No. 1 due to the use of emulsion polymer, which is more expensive than mannich polymer but provides an improved percent of cake solids. The projected cationic polymer budgets are $2,010,000 for FY 2016-17 and $2,160,000 for FY 2017-18. 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, additional amounts of ferric chloride are added to the digesters to control hydrogen sulfide. The projected ferric chloride budget for FY 2016-17 is $2,730,000, a decrease of $988,000 from the FY 2015-16 projected expense due to new pricing agreements. No change in the budget is anticipated for FY 2017-18. 3b) Odor Control $ 7.5 $ 8.2 $ 8.7 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 is $1,200,000 for FY 2016-17 and FY 2017-18. 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 budgets for caustic soda for FY 2016-17 is $969,000 and $960,000 in FY 2017-18. 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 2016-17 is $36,000. 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 2 2016-17 AND 2017-18 BUDGET DEVELOPMENT—ADDITIONAL DETAIL (in millions unless otherwise noted) Projected Proposed Proposed 2015-16 2016-17 2017-18 control chemical dosing systems within the wastewater collection and conveyance system. The projected budget for FY 2016-17 is $2,046,000, an increase of $546,000 from the FY 2015-16 projected expense. The increase is due to a slight unit price increase and expanding the program to the Main Street Pump Station resulting from the removal of IRWD injection points that use ferrous chloride. The projected budget of$2,079,000 for FY 2017-18 also reflects a slight 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 2016-17, the projected budget is $2,793,000, a decrease of$257,000 from the FY 2015-16 projected expense due to the removal of IRWD injection points using ferrous chloride. In FY 2017-18, the projected budget increases to $3,321,000 due to the planned addition of a new dosing site on the Euclid trunk sewer. 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 projected budget for FY 2016-17 is $853,000. The FY 2017-18 proposed usage will be the same as the current year. The increase in budgeted cost to $867,000 results from an estimated two percent unit rate increase. Bleach,Treatment Plant Odor Control—The projected total cost of odor control bleach is $260,000 for FY 2016-17 with no change anticipated for FY 2017-18. 3c) Disinfection $ 0.2 $ 0.2 $ 0.2 Sodium Hypochlorite (Bleach) — With the cessation of the disinfection of water discharged to the ocean, the remaining treatment plant bleach usage is for the disinfection of plant water and odor control. It is anticipated that the District treatment plant bleach budgets will be $167,000 in FY 2016-17 and $177,000 in FY 2017-18. Sodium Bisulfite — Sodium bisulfite is used for dechlorination of outfall effluent at Plant No. 2, if required, to ensure that no residual chlorine is discharged into the ocean. The sodium bisulfite budgets are $4,000 in FY 2016-17 and FY 2017-18. 3d) Tools and Safety Equipment/Tools $ 0.9 $ 1.3 $ 1.1 O&M and Safety use 93 percent of these budgets. There has been an increase in these budgets since the definition of capital equipment has changed; tools and equipment that cost less than $5,000 are not considered to be capital. Personal Protective Equipment 3 2016-17 AND 2017-18 BUDGET DEVELOPMENT — ADDITIONAL DETAIL (in millions unless otherwise noted) Projected Proposed Proposed 2015-16 2016-17 2017-18 requirements have increased, and there are different tools needed to maintain the new facilities. 3e) Laboratory Chemicals and Supplies $ 0.6 $ 0.6 $ 0.6 Approximately 90 percent 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 $ 0.6 $ 0.6 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 $ 0.6 $ 0.7 $ 0.8 Other smaller operating expenses collectively reported within this one line item such as chemicals for CoGen operations, janitorial supplies and miscellaneous operating supplies. 4) CONTRACTUAL SERVICES $23.5 $24.8 $22.6 4a) Solids Removal $17.9 $17.2 $14.0 Biosolids — OCSD's has benefitted from low diesel prices as fuel surcharges remain low, keeping program costs within budget despite an increase in solids production. The total cost for FY 2016-17 is projected to decrease from FY 2015-16 by 3.7 percent to $17,206,000 due to the anticipated mid-year price reduction after the rebidding of a contract for solids management. The cost is projected to decrease another 18.9 percent in FY 2017-18 to $13,950,000 due to the sludge dewatering and odor control facilities coming online at Plant No. 1 in 2017. 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 2016-17 AND 2017-18 BUDGET DEVELOPMENT — ADDITIONAL DETAIL (in millions unless otherwise noted) Projected Proposed Proposed 2015-16 2016-17 2017-18 4c) Grounds keeping/Janitorial/Security $ 1.1 $ 1.1 $ 1.2 The Security Services budget is projected to increase from the FY 2015-16 projected total of $410,000 to $660,000 in FY 2016-17, a $191,000 or 61 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 nine percent to $720,000 in FY 2017-18. The increases in Security Services is largely offset by the 27 percent decrease in the Groundskeeping and Janitorial Service budgets due to reductions in contract prices. 4d) County Service Fee $ 0.7 $ 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 $ 0.4 $ 0.4 $ 0.4 The oxygen plant has been decommissioned. Increases in costs in FY 2016-17 and FY 2017-18 for pure oxygen include anticipated rate increases. 4f) Temporary Services $ 0.5 $ 0.8 $ 1.1 In addition to the temporary services used to fill in for long-term leaves and position vacancies, an increase is proposed in FY 2016-17 and FY 2017-18 to provide additional support for the Civil Assets Maintenance Program (CAMP). 4g) Outside Lab Services $ 0.2 $ 0.3 $ 0.3 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 $ 1.9 $ 3.4 $ 4.0 Over 95 percent of contracted services are in support of operating and maintaining the collection system and the treatment plants. Collection system services include line cleaning ($304K), closed circuit television of lines ($500K), manhole frame and cover rehabilitation and replacement ($367K), manhole structural repair and coating ($265K), sewer repair and relining ($122K), root and pest control ($82K), and traffic control ($60K). Treatment plant services include CAMP-related support services for asset assessment ($350K), industrial cleaning ($426) and coatings ($200K), as well as specialized HVAC support services ($200K). 5 2016-17 AND 2017-18 BUDGET DEVELOPMENT — ADDITIONAL DETAIL (in millions unless otherwise noted) Projected Proposed Proposed 2015-16 2016-17 2017-18 5) REPAIRS AND MAINTENANCE $ 13.4 $ 14.2 $ 16.1 5a) Materials & Services $ 10.9 $ 11.4 $ 12.6 Approximately 97 percent of these budgets support the maintenance of the collection system and treatment plants. O&M contracted materials and services for FY 2016-17 include: Central Generation engine overhaul ($1.31M),digester cleaning ($1.31M); carbon media replacement ($463k); belt press overhaul ($200k); electrical protective relay maintenance ($250k); interplant line inspection and maintenance ($186K); emergency generator maintenance ($150K); and other maintenance services and operating materials, including street overlays/manhole cover raisings and replacements, and warehouse stock. The increases following FY 2015-16 are attributed to items previously deferred that are now being addressed in FY 2016-17 and FY 2017-18. 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 $ 2.5 $ 2.8 $ 3.5 Over 94 percent of service contracts are computer-related or 0&M maintenance-related. Major contracts for Information Technology include JDE-Primavera-Oracle support ($309K); Microsoft License Agreements ($292K); Software Maintenance for Maximo ($176K); and various smaller service agreements. O&M service contracts include: maintenance of doors and security gates ($131 K); maintenance of uninterruptible power supplies ($99K); tree pruning and removal services ($50K); inspection, testing and certification of cranes ($45K); maintenance of fire sprinklers and extinguishers ($40K); and various other plant maintenance agreements. Additional service maintenance agreements covering various equipment items are budgeted throughout the District. 6) UTILITIES $ 8.5 $ 8.9 $ 10.2 6a) Power $ 7.0 $ 7.3 $ 8.5 Electricity — The treatment plants and support buildings estimated consumption and resulting costs for electrical energy purchased from Southern California Edison for the FY 2016-17 are $6,144,000 and the pump stations budget for the same period is $610,000. Other support buildings power costs are $570,000, completing the total estimated power costs for FY 2016-17. The increase in FY 2017-18 is due to increased power usage associated with the sludge dewatering and odor control facilities anticipated to be operational in March 2017. 6 2016-17 AND 2017-18 BUDGET DEVELOPMENT—ADDITIONAL DETAIL (in millions unless otherwise noted) Projected Proposed Proposed 2015-16 2016-17 2017-18 6b) Water $ 0.6 $ 0.7 $ 0.7 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. The majority of the water is used for process functions (e.g., chemical mixing) and domestic uses. The projected total potable water cost for FY 2016-17 is $646,000. 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 (OCWD). As provided in OCSD's agreement with the OCWD, OCSD receives up to 1,120 acre feet of GAP water annually at no charge. The major uses of GAP water include cooling water, solids handling, and landscaping. The proposed budgets for FY 2016-17 and FY 2017-18 are $5,000 per year to provide for some minimal use beyond the 1,120 acre feet allotment. 6c) Natural Gas $ 0.5 $ 0.5 $ 0.6 Natural Gas — The total FY 2016-17 natural gas estimate is $519,000, slightly higher than the FY 2015-16 projected. The higher budget estimate for FY 2017-18 reflects an anticipated higher unit cost for gas. The natural gas used for Central Generation is purchased from a gas marketer, currently Constellation Energy, and transported through The Gas Company conveyance system at stipulated cost of$0.12/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. 6d) Telephone $ 0.4 $ 0.4 $ 0.4 Telephone—The total FY 2016-17 telephone estimate is $400,000, $50,000 higher than the FY 2015-16 projected due to the addition of services to support the disaster recovery plan. 7) PROFESSIONAL SERVICES $ 3.0 $ 4.1 $ 4.2 7a) Legal Services ($1.4M) 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. 7 2016-17 AND 2017-18 BUDGET DEVELOPMENT — ADDITIONAL DETAIL (in millions unless otherwise noted) Projected Proposed Proposed 2015-16 2016-17 2017-18 7b) Engineering Services ($743K) These services provide technical support that in-house staff cannot provide or do not have the time to provide. In FY 2016-17 requested engineering services include Corrosion Management support ($593K); SCADA System support ($50K); Process Engineering Optimization ($25K); and miscellaneous studies and evaluations ($75K). 7c) Advocacy Efforts ($242K) These are consultant services for promoting the District's interests in Sacramento and Washington D.0 concerning legislation and funding. 7d) Audit& Accounting ($271K) These services represent the cost for the District's independent annual financial audit and contracted internal auditing services. 7e) Software Program Consultant ($410K) 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 ($1.197M) Professional services also includes: labor negotiation services ($80K); environmental scientific consulting services ($125K); and industrial hygiene services ($50K). 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 $ 1.6 $ 2.2 $ 2.6 8a) Property & General Liability Insurance ($1.1M) The District's outside excess general liability insurance coverage is $40 million with a self- insurance retention of $500,000. 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 partially self-insured for all property damage from the perils of earthquake, but does carry $25 million in coverage on seven key structures with a $5 million deductible. The proposed appropriation of$1.1 million is needed to maintain the recommended level of reserve within the general liability and property self-insurance fund. 8 2016-17 AND 2017-18 BUDGET DEVELOPMENT — ADDITIONAL DETAIL (in millions unless otherwise noted) Projected Proposed Proposed 2015-16 2016-17 2017-18 8b) Regulatory Operating Fees ($716K) 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($391K) Other material, supplies, and services collectively reported within this one line item. 9) ADMINISTRATIVE EXPENSE $ 1.5 $ 1.8 $ 1.9 9a) Small Computer Items ($750K) New Computers/Notebooks/Tablets, printers, monitors, Networking equipment, Computer peripherals, Digital equipment, PDAs, Digital Cameras, etc. 9b) Memberships ($586K) OCSD's largest membership costs are for District-wide participation in groups such as the National Association of Clean Water Agencies, the National Water Research Institute, the Water Emergency Response Organization of Orange County, the Water Environment Research Foundation, the Information Technology Approval Group, the California Association of Sanitation Agencies, the Southern California Alliance of Publicly Owned Treatment Works, and the Center for Demographic Research. A minor portion of these expenses is for staff memberships in professional associations. 9c) Minor Furniture & Fixtures ($260K) Minor furniture & fixtures include such items as desks, chairs and related work station fixtures. 9d) Office Supplies ($63K) Office supplies include such items as envelopes, letterhead, notebooks, calendars, etc. 9e) Other($93K) Other smaller administrative expenses collectively reported within this one line item. 9 2016-17 AND 2017-18 BUDGET DEVELOPMENT — ADDITIONAL DETAIL (in millions unless otherwise noted) Projected Proposed Proposed 2015-16 2016-17 2017-18 10) RESEARCH AND MONITORING $ 0.7 $ 0.8 $ 0.9 10a) Environmental Monitoring ($305K) The budget line items that make-up"Environmental Monitoring'include costs associated with the District's National Pollution Discharge Elimination System (NPDES) permit- required ocean monitoring program. Core compliance monitoring occurs annually. Regional monitoring occurs on a 5 year cycle and is a cooperative, multi-agency effort that targets large issues and projects that are beyond the scope of any single agency. Strategic process studies address environmental issues facing OCSD that are outside the scope of the core compliance or regional monitoring. These funds are needed to meet OCSD's permit-required environmental monitoring program, which includes operating funds and insurance fees for the District's ocean monitoring vessel, Nerissa. 10b)Air Quality Monitoring ($95K) 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 filters, P1 primary basin install and modifications, etc.) Periodically, there is a requirement to test the waste gas flares. 10c) Other Research ($400K) 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 $ 1.2 $ 1.2 11a) General Manager Contingency ($640K) 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 ($376K) 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. 10 2016-17 AND 2017-18 BUDGET DEVELOPMENT — ADDITIONAL DETAIL (in millions unless otherwise noted) Projected Proposed Proposed 2015-16 2016-17 2017-18 12) TRAINING AND MEETINGS $ 0.8 $ 1.2 $ 1.2 12a) Training ($950K) An amount equal to approximately 1.8 percent of the Regular Salaries budget is allocated to Training. Compliance and safety training activities are coordinated through the Human Resources Department. 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 ($208K) 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 $ 0.4 13a) In-House Publishing ($244K) 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 ($40K) Other printing and publishing expenses collectively reported within this one line item. 14) COST ALLOCATION ($18.3) ($19.2) ($19.4) This represents direct and indirect labor, benefits, materials, and services charged to the Capital Improvement Program (CIP) where the related work was performed. 11 ADMINISTRATION COMMITTEE Meeting Date To ad.of Dir. 04,13,16 -- AGENDA REPORT IWm Number Item Number s Orange County Sanitation District FROM: James D. Herberg, General Manager Originator: Robert Ghirelli, Assistant General Manager SUBJECT: PRETREATMENT PROGRAM OVERVIEW GENERAL MANAGER'S RECOMMENDATION Information Only. SUMMARY BACKGROUND Each month staff provides an informational presentation on topics of interest to the Board of Directors. This month's topic is an overview of the Orange County Sanitation District's federally mandated pretreatment program. RELEVANT STANDARDS • Meet federal pretreatment requirements under 40 CFR 403 • Protect influent and biosolids for recycling • Protect the effluent for marine discharge • Protect collection system, treatment plants and other infrastructure ATTACHMENT The following attachment(s) may be viewed on-line at the OCSD website (www.ocsd.com) with the complete agenda package: N/A RG:JC:jb Page 1 of 1 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) ICS Incident Command System IERP Integrated Emergency Control Plan LOS Level of Service MGD Million gallons per day NACWA National Association of Clean Water Agencies NPDES National Pollutant Discharge Elimination System NWRI National Water Research Institute O&M Operations and Maintenance OCCOG Orange County Council of Governments OCHCA Orange County Health Care Agency OCSD Orange County Sanitation District OCWD Orange County Water District GOBS Ocean Outfall Booster Station OSHA Occupational Safety and Health Administration PCSA Professional Consultant Services Agreement POTW Publicly Owned Treatment Works ppm Parts per million PSA Professional Services Agreement RFP Request For Proposal Glossary of Terms and Abbreviations 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 SAW PA 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. Coliform bacteria—A group of bacteria found in the intestines of humans and other animals, but also occasionally found elsewhere used as indicators of sewage pollution. E. coli are the most common bacteria in wastewater. Collections system — In wastewater, it is the system of typically underground pipes that receive and convey sanitary wastewater or storm water. Glossary of Terms and Abbreviations Certificate of Participation (COP) -A type of financing where an investor purchases a share of the lease revenues of a program rather than the bond being secured by those revenues. Contaminants of Potential Concern (CPC) - Pharmaceuticals, hormones, and other organic wastewater contaminants. Dilution to Threshold (D!f) - the dilution at which the majority of the people detect the odor becomes the D(f 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. NOMA- 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. Glossary of Terms and Abbreviations Trickling filter — A biological secondary treatment process in which bacteria and other microorganisms, growing as slime on the surface of rocks or plastic media, consume nutrients in wastewater as it trickles over them. Urban runoff — Water from city streets and domestic properties that carry pollutants into the storm drains, rivers, lakes, and oceans. Wastewater—Any water that enters the sanitary sewer. Watershed —A land area from which water drains to a particular water body. OCSD's service area is in the Santa Ana River Watershed.