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HomeMy WebLinkAbout98.06-22-16 Board Item 13 Attachment - Proposed Executive Summary ONLINE.pdf Exec mu U AP& . l• 1 Orange County Sanitation District, Calif` nib Y Orange County Sanitation District, Californi BUDGET EXECUTIVE SUMMARY Fiscal Years 2016- 17 and 2017- 18 OUR MISSION 'To protect public health and the environment by providing effective wastewater collection, treatment, and recycling." GFOA BUDGET PRESENTATION AWARD G�9 GOVERNMENT FINANCE OFFICERS ASSOCIATION Distinguished Budget Presentation Award PRESENTED I'0 Orange County Sanitation District California For the Biennium Beginning July I, 2014 1rY77'r��Jh+ The Government Finance Officers Association of the United States and Canada (GFOA) presented a Distinguished Budget Presentation Award to the Orange County Sanitation District, California, for its biennial budget for the biennium beginning July 1,2014. In order to receive this award,a government unit must publish a budget document that meets program criteria as a policy document,as an operations guide,as a financial plan,and as a communications device. The award is valid for a period of two years only.We believe our current budget continues to conform to the program requirements,and we are submitting it to GFOA to determine its eligibility for another award. TABLE OF CONTENTS OCSDService Area..............................................................................................................................................i Boardof Directors...............................................................................................................................................ii BoardCommittees..............................................................................................................................................iB Orange County Sanitation District Organization Chart.............................................................................iv AdministrativeOfficials.......................................................................................................................................v Message from the General Manager...............................................................................................................vi FinanceSummary.............................................................................................................................................. 1 Financial Overview&Budgetary Issues..........................................................................................................2 Wbere the Money Comes From.......................................................................................................................6 FundingSources by Category............................................................................................................................6 Wberethe Money Goes......................................................................................................................................8 FundingUses by Category.................................................................................................................................8 Collection,Treatment&Recycling Process Overview............................................................................10 Infrastructure Asset Management...............................................................................................................12 Capital Improvement Program....................................................................................................................22 DebtFinancing Program................................................................................................................................24 OperatingExpenses.........................................................................................................................................26 Departments......................................................................................................................................................30 Summary.............................................................................................................................................................30 General Manager's Office.................................................................................................................................32 HumanResources.............................................................................................................................................34 AdministrativeServices....................................................................................................................................36 Environmental Services....................................................................................................................................38 Engineering.........................................................................................................................................................40 Operations and Maintenance..........................................................................................................................42 Appendix Five Year Strategic Plan Wastewater Treatment Process Diagram OCSO SERVICE AREA OCSD service Area r.re..Dle,geel LA HABRA BREA ORANGE COUNTY YORBA C;hb°;°9 B1e FULLER N LINDA PLAC TIA LA ARK PL YPRE ANAHEIM VILLA PA L0S NTO A AMITOS ORANGE RO ROV ' ce SEAL BEACH IN ER cm e SAN UNTA ANA TUSTIN ALLEI HUNTI GT0 IRVINE COSTA MESA OCBD Emese,Oul�ell N S tulles long B SIml Elemeler Service area boundary O,r,l alv.„ NEWPORT s.Iles lD, BEACH Sewer pipelines �c-ma diem¢, Bull® Reclamation Plant No.I(PI) Treatment Plant No.2(P2) / Pump Stations DISMMER Wp P"pa° tt ml,m p O Unincorporated Orange County(white areas) a lul n""o°r„.° . Pane eluN W�Dfa.Al,Plgnr-- v�D.w/rzou BOARD OF DIRECTORS Agency/Cities Active Director Alternate Director Anaheim Lucille Kring James Vanderbilt Brea Glenn Parker Cecilia Hupp Buena Park Fred Smith Virginia Vaughn Cypress Mariellen Yarc Stacy Berry Fountain Valley Steve Nagel Cheryl Brothers Fullerton Greg Sebourn Doug Chaffee Garden Grove Steve Jones Kris Beard Huntington Beach Jim Katapodis Erik Peterson Irvine Steven Choi Lynn Schott La Habra Tom Beamish Tim Shaw La Palma Peter Kim Michele Steggell Los Alamitos Richard Murphy Shelley Hasselbrink Newport Beach Keith Curry Scott Peotter Orange Teresa Smith Mark Murphy Placentia Chad Wanke Constance Underhill Santa Ana Sal Tinajero David Benavides Seal Beach Ellery Deaton Sandra Massa-Lavitt Stanton David Shawver Carol Warren Tustin John Nielsen Allan Bernstein Villa Park Greg Mills Diana Fascenelli Sanitary Water Districts Costa Mesa Sanitary District James Ferryman Robert Ooten Midway City Sanitary District Joy Neugebauer Al Krippner Irvine Ranch Water District John Withers Douglas Reinhart Yorba Linda Water District Robert Kiley Michael Beverage County Areas Member of the Board of Supervisors Michelle Steel Shawn Nelson B BOARD COMMITTEES Steering Committee Operations Committee John Nielsen,Board Chair John Withers,Chair(IRWD) Greg Sebourn Board Vice-Chair David Shawver,Vice-Chair(Stanton) John Withers,Chair,Operations Committee Tom Beamish(La Habra) Keith Curry,Chair,Administration Committee Ellery Deaton(Seal Beach) Lucille Kring,Member-At-Large Steve Jones(Garden Grove) David Shawver,Member-At-Large Robert Kiley(YLWD) Tom Beamish,Member-At-Large Richard Murphy(Los Alamitos) Steve Nagel(Fountain Valley) Administration Committee Fred Smith(Buena Park) Keith Curry,Chair(Newport Beach) Michelle Steel(Board of Supervisors) Lucille Kring Vice-Chair(Anaheim) Chad Wanke(Placentia) Steven Choi(Irvine) Mariellen Yarc(Cypress) James Ferryman(CMSD) John Nielsen,Board Chair(Tustin) Jim Katapodis(Huntington Beach) Greg Sebourn,Board Vice-Chair(Fullerton) Peter Kim(La Palma) Greg Mills(Villa Park) Legislative and Public Affairs Committee Joy Neugebauer(MCSD) Tom Beamish(La Habra) Glenn Parker(Brea) Peter Kim(La Palma) Teresa Smith(Orange) Robert Kiley(YLWD) Sal Th ajero(Santa Ana) Lucille Kring(Anaheim) John Nielsen,Board Chair(Tustin) John Nielsen,Board Chair(Tustin) Greg Sebourn,Board Vice-Chair(Fullerton) Greg Sebourn,Board Vice-Chair(Fullerton) John Withers(IRWD) T 1° :RAN III ORGANIZATION CHART General Management Administration go Board Services Public Affairs riman Resources Administrative Environmental Engineering Operations & ministration Services Services Administration Maintenance k Management/ Financial Administration Planning Administration Safety/Security Management Environmental Project Collection Facilities Contracts, Compliance Management Off Operations& Purchasing Laboratory& Maintenance Materials Ocean Monitoring Civil& Fleet Services Management Mechanical Engineering Plant No.f Information Electrical& Operations Technology Control Systems Plant No.2 Engineering Operations Plant No.t Maintenance Plant No.2 Maintenance n ADMINISTRATIVE OFFICIALS Management Team General Manager......................................................................................................................................................lames Herberg Assistant General Manager....................................................................................................................................Robert GhireBi Director of Engineering.....................................................................................................................................Robert Thompson Director of Environmental Services.......................................................................................................................Tames Colston Director of Finance and Administrative Services...............................................................................................Lorenzo Tyner Director of Human Resources...............................................................................................................................Celia Cbandler Director of Operations&Maintenance...............................................................................................................Edvnrd Torres GeneralCounsel.......................................................................................................................................................Bradley Hogin sr r - n , u MESSAGE FROM THE GENERAL MANAGER June 1,2016 Honorable Chair and Board of Directors: I am pleased to submit the Orange County Sanitation District's(OCSD) Proposed Budget for fiscal year 2016-17 and 2017-18.This document lays out the framework for OCSD's activities during the next two years,and serves as a source of information for OCSD's Board of Directors,our ratepayers and our employees.This budget includes the operational,capital and debt service expenditures necessary to cost- effectively support our mission and execute the Strategic Plan adopted by our Board of Directors in December 2015.Our work plan focuses on four distinct program areas: • Expanded Water Recycling-In partnership with the Orange County Water District(OCWD),our agency recycles enough water to supply the needs of 850,000 people.Recognizing the need for a reliable, affordable and high quality water supply,our Board of Directors has set a goal of recycling 100 percent of our wastewater flows.We will be working with OCWD on the planning and design of the ultimate expansion of the Groundwater Replenishment System over the next two years. • Infrastructure Reliability and Operational Sustainability-We will continue to improve our planned maintenance program to include civil assets in addition to electrical and mechanical systems.Our long term facilities Master Plan will also be updated during the next two years and will serve as a basis for our new rate structure that will take effect in 2018.Recognizing the importance of resiliency in the event of a disaster,we will complete our business continuity plan and establish offsite backup infrastructure.In fiscal year 2016-17,we will complete the transfer of local sewers in the Tustin area to a local provider, which will allow us to focus on regional services. • Safety and Security-Capital projects,maintenance activities,and training to address safety in our workplace are included in our work plan. We are also enhancing our physical and electronic security measures. • Workforce Succession Planning-Recognizing the ongoing retirement wave,we will continue to invest in our employees focusing on planning,leadership training and improved recruitment strategies. I would like to take this opportunity to highlight some of the important revisions to next year's budget: • Departmental Restructuring-OCSD restructured its departments to strategically align our engineering, operating,and environmental functions to better meet the challenges of the future.The business units within the Facilities Support Services Department were merged into other departments.The Collections,Operations and Maintenance and Fleet Services divisions were moved into the Operations and Maintenance Department.This change will allow for better coordination and standardization of our maintenance efforts for all of OCSD's infrastructure.The Source Control inspection team merged ri FISCAL YEARS 2010-17 AND 2017-18 BUDGET with the Pretreatment Compliance team in a newly created Environmental Services Department. This new department will lead OCSD's environmental and regulatory efforts and will also include the Environmental Sciences Laboratory,Ocean Monitoring,Compliance,Air Quality,and Biosolids Programs.The reorganization also consolidated project management functions in the Engineering Department to form an agency wide Project Management Office.These changes will allow us to more efficiently and effectively deliver service to internal and external customers. . Operating Expense Cost Containment-Despite inflationary increases on many external costs such as chemicals and utilities,we will minimize the impact on rate-payers by aggressively negotiating our contracts,ensuring a competitive bidding environment,prudently managing debt and implementing efficiencies.The 2016-17 Operating Budget represents only a 3.5 percent increase from the current year projected actuals.Operating efficiencies such as the reduction of long-term liabilities,operational improvements and general cost containment have allowed OCSD to reduce ongoing expenses and the need for additional resources. . Reduction in Long-term Liabilities-Many government agencies are faced with growing long-term liabilities,particularly in the area of pensions.OCSD has been aggressive in reducing its liability and developed a plan to address this issue.By making advanced payments,as I have included in this budget,OCSD has eliminated its unfunded pension liability,saving tens of millions of dollars in premium payments. . Rate&Sewer Service Planning-Our current rate structure expires on June 30,2018.During this budget period,we will establish and present to the board a sound financial plan in line with the goals of the agency. While addressing rising treatment and chemical costs,aging infrastructure,and increased regulatory requirements,this budget displays our commitment to efficiency as it includes only minimal staffing and operating cost increases;and rate increases averaging less than 2 percent per year. OCSD will continue to provide wastewater treatment,recycling,sewer and facilities maintenance,ocean monitoring and many other services while maintaining one of the lowest rates in the state.I believe this budget fully supports the goals included in the Orange County Sanitation District's Strategic Plan and positions us well to address challenges in the coming years. James D.Herberg General Manager Orange County Sanitation District rii rcynnlio¢N0';aI�G.. 2 Y t zA !� .SIC err Olt r ORANGF COUNTY SANITATION DISTRICT EXECUTIVE SUMMARY HSCAI YFARS 2016 17 AND 7017-18 FINANCE SUMMARY FINANCIAL SUMMARY/OVERVIEW & BUDGETARY ISSUES Budget Overview level of 641 FTE positions.Personnel costs will decrease primarily due to decreases in retirement premiums Orange County Sanitation District's(OCSD's fiscal after OCSD made a$50 million payment to reduce the year 2016-17 and 2017-18 operating and capital unfunded pension liability.An additional payment of improvement budgets are proposed at $25 million against the unfunded pension liability is $475 million and$375 million,respectively.The planned in 2016-17. decrease in the 2017-18 budget is primarily due to (1)the transfer of local sewer lines to the East Orange The District will continue to effectively manage these County Water District along with the$40 million in expenses with approximately 20 percent of the budget capital replacement reserves and(2)the pay down of the allocated to employee costs,much less than most other remaining$25 million in unfunded actuarial accrued government agencies. liability with the Orange County Employees Retirement System planned for fiscal year 2016-17.The budget Level of Treatment continues to reflect the agency's ongoing efforts to streamline operations. The agency's two treatment plants,located in Fountain Valley and Huntington Beach,process about 185 OCSD's CIP budgets for fiscal year 2016-17 and 2017- million gallons of wastewater each day generated by 18 are$171 million and$138 million,respectively, approximately 2.6 million people residing within central net of savings and deferrals.This CIP budget supports and northwest Orange County and the businesses that collection system,joint works treatment and disposal operate within this service area.The proposed budget system improvement projects.The decrease in the to operate,maintain and manage our sewage collection, second year is due to the timing of construction cash treatment and disposal system,including self-insurance outlays as we meet our infrastructure needs. requirements,for the next two years is$149 million and $153 million.Increases are primarily a result of repairs Financing and maintenance,utilities,and personnel costs. The District uses long-term Certificates of Participation The cost per million gallons of wastewater treated(an (COP)for financing capital improvements that cannot industry-wide performance measurement)is expected be completely funded from current revenue.Before any to increase by$68,or 3.2 percent,in fiscal year 2016-17 new debt is issued,the impact of debt service payments to$2,167. on total annual fixed costs is analyzed.Total COP indebtedness is currently at$1.1 billion. No new money To eliminate most bacteria from being released from the debt financings are currently forecasted to assist in the ocean outfall,in fiscal year 2002-03 the District began funding of the$2.4 billion in capital improvements using chlorine bleach to disinfect the effluent and then required over the next 10 years. applying sodium bisulfite to remove remaining chlorine prior to releasing the treated wastewater to the ocean. Staffing This mode of disinfection continued until March 18, Reflecting the organization's commitment to providing 2015.OCSD staff conducted numerous studies on the service at the lowest costs,the budget reflects a minimal use of disinfection on the marine environment.OCSD increase of three authorized full time equivalent(FTE) used a Blue Ribbon Panel of experts assembled by the positions for fiscal years 2016-17 and 2017-18 as staffing National Water Research Institute.After an exhaustive is proposed at 627 FTE positions in both years.The new review of OCSD's practices and receiving water data,the positions are needed to provide additional support for Panel recommended eliminating the continuous use of the increasing demands of the capital improvement and disinfection.There will continue to be small amounts of asset management programs. bleach and bisulfite at the treatment plants for possible emergencies. Plant water is used throughout the This staffing level continues to reflect a significant wastewater processes,and there will be sufficient bleach reduction from the fiscal year 2010-11 approved staffing for plant water disinfection. 2 FISCAL YEARS 2010-17 AND 2017-18 BUDGET era a � Sewer Service Fees implement the final expansion of GWRS.The expansion will add an additional 30 million gallons a day(MGD), The 2016-17 and 2017-18 single family residential rates bringing the total GWRS capacity to 130 MGD of are scheduled to increase by approximately one percent drinking water. each year to$327 and$331,respectively.OCSD's rates are well below the statewide average sewer rate of$475, Capital Improvement Program according to a 2015 survey of 731 agencies in California. (CIP) Groundwater Replenishment In preparation of this two-year budget,the District System (GWRS) completed the FY 2016-17 CIP Validation Update. The OCSD Strategic Plan includes water reclamation. Highlights of this Validation Update are as follows: With the Orange County Water District(OCWD), • Fiscal year 2016-17 proposed CIP expenditures are OCSD completed the GWRS,the nation's largest water $171.3 million,net of savings and deferrals. reclamation project,in January 2008. • Overall total projected CIP expenditures over the 10 year life of the CIP program are$2.4 billion. The original GWRS facility reclaimed 70 million gallons , Four new CIP projects were added with projected of water a day,delaying the need to build a second outlays of$15.9 million. outfall which could cost more than$200 million.OCSD and OCWD equally shared the expenses of this project Projects Driving the CIP and approximately$44 million in Federal and State grants that were received to offset part of the total costs. Over the next 24 months,the largest capital cash outlays are: Initial expansion of GWRS increased the production 1.Sludge Dewatering and Odor Control at Plant No.2- of reclaimed water to 100 million gallons a day.This $40.3 million($90.5 million total budget) expansion,which was funded entirely by the OCWD, was completed in early 2015.OCSD is directing 2.Newhope-Placentia Trunk Replacement- all reclaimable flows from Plant No. 1 to OCWD $35.1 million($99.5 million total budget) in support of providing maximum amounts of 3.Sludge Dewatering and Odor Control at Plant No. 1 - specification water for reclamation. $28.1 million($188.3 million total budget) A feasibility study for recycling all of OCSD's 4.Rehabilitation of Western Regional Sewers- reclaimable effluent was completed in May 2016.This $22.4 million($215.3 million total budget) study was jointly funded by OCSD and OCWD with 5.Gisler-Red Hill Trunk Improvements-Reach B- a grant from the U.S.Bureau of Reclamation.The $18.9 million($25.2 million total budget) feasibility study identified the projects necessary to ORANGE COUNTY SANITATION DISTRICT I EXECUTI 3 FINANCIAL SUMMARY/OVERVIEW & BUDGETARY ISSUES Operating Budget Increase Repairs and Maintenance - The operations budget for the collection,treatment,and $0.8M Increase disposal of wastewater is proposed at$148.9 million, This expense category includes parts and services for a$5.0 million(3.5 percent)increase above 2015-16 repairing aging treatment plant and collection facilities, projected expenditures.It is projected to increase by an and reflects base budgets for equipment maintenance additional$3.5 million(2.4 percent)in 2017-18. as well as out-sourced annual service contracts and Although some expenses will increase or decrease maintenance agreements.The fiscal year 2016-17 budget slightly,the overall increase to the operating budget increase of$839,000(6.2 percent)is mostly attributable in 2016-17 over the 2015-16 projected is primarily to increases in basic repairs and maintenance costs and attributable to seven specific areas: Central Generation(Cerl engine overhaul. Salaries and Benefits - $0.6M Utilities - $0.4M Increase Decrease The proposed electric power budget reflects an increase of$346,000 over the prior year projected due to Salaries and benefits will decrease primarily due to a anticipated consumption and unit cost increases. reduction of$4.6 million in retirement premiums as a result of the District's decision to use available cash Other Materials, Supplies, reserves to reduce the unfunded pension liability by Services - $1.8M Increase $50 million in 2015-16.This decrease will be partially offset by increases of$3.7 million(5.9 percent)in The increase is primarily due to an increase in the salaries and wages and an increase of$0.5 million property and general liability insurance premiums and (5.2 percent)in group insurance costs. the restoration of the General Manager's contingency These changes reflect the impacts from existing and the contingency for prior year reappropriations. collective bargaining agreements and revised actuarial Cost Allocation - $0.9M Increase assumptions on retirement premiums. Total salary and overhead costs charged to capital Contractual Services - $1.4M projects are expected to increase based on the updated Increase cost allocation plan and overhead rates. The increased charges to capital projects will decrease the net Although biosollds removal and transportation costs are operating budget. expected to decrease in 2016-17 by$660,000 as a result of new service contracts,costs for temporary services and other contractual services are expected to increase Operating Expenses to support the Civil Assets Maintenance Program. Contractual services costs are expelled to decrease by +3.5% +3.4% $2.2 million in 2017-18 as a result of the completion of the sludge dewatering facilities that will significantly reduce biosolids removal and transportation costs. Professional Services - $1.1 M Increase The Increase in professional services in fiscal year FY 1015-16 FY 3016-17 FY 2017-16 2016-17 is to support the comprehensive Civil Assets Projected proposed Proposed Maintenance Program Operatingin FY 216 17 and another$mantenarre 3.5 million R.4%)In FY millionjo 018. 4 FISCAL YEARS 2010-17 AND i BUDGET ORAHG� GO JIO I Y SAN I[A]ION III S I fl I C I EXECUTIVE SUMMARY-FISCAL YEARS 2016-17 e � ,r y I 1 I 2017-18 FINANCIAL SUMMARY/FUNDING SOURCES BY CATEGORY WHERE THE MONEY COMES FROM Interest Other $8.6M $4.6M 2.0% 1.0% Property Taxes $87.OM Intradistrict 20.0% Transfers - $3.4M 0.8% Fees Charges $331.9M 76.2% Funding Sources by Category (in millions) 2014-15 2015-16 2016-17 2017-18 Category Actual Projected Proposed Proposed Service Fees $291.1 $308.7 $307.1 $310.1 Property Taxes 79.9 82.9 87.0 91.4 Capital Facilities Capacity Charges 20.2 13.3 13.5 18.1 Permit User Fees 14.6 11.1 11.3 11.4 Interest 8.1 7.1 8.6 8.8 Intradistrict Transfers 5.4 8.5 3.4 1.7 Debt Proceeds 0.0 0.0 0.0 0.0 Other Revenue 4.1 4.9 4.6 4.9 Total Funding Sources $423.4 $436.5 $435.5 $446.4 6 FISCAL YEARS 2010-17 AND 2017-18 BUDGET The District has a variety of revenue sources available Interest Earnings - $8.BM for operating and capital expenses.The major revenue sources are: Interest earnings are generated from the investment of accumulated reserves consisting of a cash flow/ General Service Fees - $307.1M contingency,a capital improvement,a renewal/ User fees are ongoing fees for service paid by customers replacement,and a self-insurance reserve. connected to the sewer system.A property owner,or Intradistrict Transfers - $3.4M user,does not pay user fees until connected to the sewer system and receiving services.Once connected,users In accordance with Amendment No.2 to the Agreement are responsible for their share of the system's costs,both for Purchase and Sale of Capacity Rights in Treatment, fixed and variable,in proportion to their demand on the Disposal and Sewer Facilities between Irvine Ranch system.These fees are for both Single Family Residences Water District(IRWD)and OCSD dated (SFR)and Multiple Family Residences(MFR). November 15,1995,ownership is adjusted annually to reflect the current equity percentage ownership Property Taxes - $87.OM based on sewage flows. The County of Orange is permitted by State law Debt Proceeds - $OM (Proposition 13)to levy taxes at one percent of full market value(at time of purchase)and can increase the Certificates of Participation(COPS)are OCSD's primary assessed value no more than two percent per year.The mechanism for financing capital projects.COPS are District receives a share of the basic levy proportionate repayment obligations based on a lease or installment to what was received in the 1976 to 1978 period,less sale agreement COPS are not viewed as"debt"by the $3.5 million,the amount that represents the State's State of California,but rather a share in an installment permanent annual diversion from special districts to arrangement where OCSD serves as the purchaser. school districts that began in 1992-93.OCSD's share of No new money debt issuances are being proposed over this revenue is dedicated for the payment of debt service. the neat two fiscal years as the$2.4 billion in future Capital Facilities Capacity replacement,rehabilitation,and refurbishment projects es CFCC 13.$M anticipated over the next ten years will be adequately Charges ) — $ funded through current sewer service fee charges and The Capital Facilities Capacity Charge is a one-time meting reserves. charge imposed at the time a building or structure Other Revenue - $4.8M is newly connected to OCSD's system,directly or indirectly,or an existing structure or category of use Other revenue includes self-insurance assessments for is expanded or increased.This charge pays for OCSD workers'compensation and general liability coverage as facilities that exist at the time the charge is imposed,or to well as miscellaneous revenue such as rents and leases. pay for new facilities to be constructed in the future that will benefit the property being charged. Permit User Fees - $11.3M Permit user fees are paid by large industrial and commercial properties owners connected to the sewer system.These fees are for the owner's share of the system's costs,both fixed and variable,in proportion to the user's demand on the system. Since the inception of the Permit User Fee Program in 1970,users of OCSD's system that discharge high volumes or high strength wastewater have been required to obtain a discharge permit and pay extra fees for the costs of service. FINANCIAL SUMMARY/FUNDING USES BY CATEGORY WHERE THE MONEY GOES Operating Capital Expenses Improvement $148.9M program 31.3% $171.3M 36.1% Intradistrict Transfers Debt Service $3.4M 0.7% $151.6M 31.9% Funding Uses by Category (in millions) 2014-15 2015-16 2016-17 2017-18 Category Actual Projected Proposed Proposed Capital Improvement Program, Net $180.0 $140.2 $171.3 $138.0 Debt Service' 220.0 134.0 151.6 83.1 Operating Expenses 143.7 143.9 148.9 152.4 Intradistrict Transfers 5.4 8.5 3.4 1.7 Total Funding Uses $549.1 $426.6 $475.2 $375.2 "The proposed amount for fiscal year2016-17 includes a payment of$25 million against the District's unfunded pension liability and a payment of$40 million to the East Orange County Water District as part of an agreement to transfer responsibility for local sewer maintenance. 8 FISCAL YEARS 2010-17 AND 2017-18 BUDGET OCSD budgets its funds in four distinct areas: Operating Expenses - $148.9M Capital Improvement The proposed budget allocates resources to operate, Program ICIP) - $171.3M maintain and manage our sewage collection, treatment and disposal system,and for any associated To provide an appropriate level of service to administrative or technical requirements. OCSD's rate payers,large capital improvements are required.The CIP provides for the management Intradistrict Transfers — $3.4M and implementation of these improvements. The CIP budget includes specific projects as well as an In accordance with Amendment No.2 to the allocation for anticipated replacement,rehabilitation, Agreement for Purchase and Sale of Capacity Rights or refurbishment(RRR)projects where detailed job in Treatment,Disposal and Sewer Facilities between plans have not yet been prepared.The gross CIP project IRWD and OCSD dated November 15, 1995,ownership budgets for 2016-17 and 2017-18 are$190.3 million is adjusted annually to reflect the current equity and$153.0 million,respectively.However,the CIP percentage ownership based on sewage flows. cash outlays,net of savings and deferrals,are budgeted at$171.3 million and$138.0 million for each year,respectively. Debt Service - $151.6M 'Ibis is the cost of repaying debt.Long-term debt financing allows the District to complete large multi- year capital projects by providing funds not always immediately available. f �h �J A ORANGE COUNTY SANITATION DISTRICT EXECUTIVE SUMMARY-FISCAL YEARS 2016-17 AND 2017-18 9 COLLECTION, TREATMENT & RECYCLING PROCESS OVERVIEW OCSD's system includes approximately 570 miles Solids are then dewatered to a 20 percent solids of sewers that convey wastewater generated within consistency,called biosolids,and recycled via direct land the Sanitation District's boundaries to the Sanitation application or composting. District's two wastewater treatment plants,Reclamation Plant No. 1 located in the City of Fountain Valley, Approximately 130 million gallons per day of secondary and Treatment Plant No.2located in the City of effluent from Reclamation Plant No. 1 is sent to the Huntington Beach. Orange County Water District(OCWD)for recycling in its two treatment processes. Influent wastewater undergoes Preliminary Treatment upon entry to the treatment plants where it is filtered The first is OCWD's Groundwater Replenishment through bar screens,and grit and debris are removed. System(GWRS).The GWRS is the largest water It then flows to Primary Treatment,which consists purification project of its kind in the world and its of large settling basins where solids are settled out, construction was funded jointly by OCWD and OCSD. enhanced by the addition of chemicals,and sent to At 100 million gallons per day,the GWRS generates Solids Processing.Wastewater then flows to Secondary enough pure water to meet the needs of 850,000 people. Treatment,which is a biological process using either the The second is OCWD's Green Acres Project(GAP) trickling filter or activated sludge process.Solids removed which is a water recycling effort that provides reclaimed in Secondary Treatment are also sent to digestion. water for landscape irrigation at parks,schools and Methane gas generated during the natural golf courses as well as for industrial uses,such as carpet decomposition of the solids in the digesters fuels the dying.The total annual demand for GAP water is about Central Power Generation System producing enough four million gallons per day. electricity to meet two-thirds of the power needed to run both treatment plantsMM - i f _ r 10 Ra' FISCAL YEARS 2010-17 AND 2017-18 BUDGET r - lul a z : w 4 ORANGE COUNTY SANITATION DISTRICT EXECUTIVE SUMMARY-FISCAL YEARS 2016-17 AND 2017-18 i �� INFRASTRUCTURE ASSET MANAGEMENT Asset Management including installation date,asset cost,condition and criticality in the new system. In December 2002 the Orange County Sanitation District(OCSD)Board adopted their"Asset While the TeamPlan Software projects future renewal Management Strategic Plan and Framework Analysis" cash flow requirements in the long-term,OCSD has (Strategic Plan). The Strategic Plan defined Asset been striving to more accurately identify medium to Management for OCSD as;"to create and acquire, short-term capital cash flow requirements.Specifically, maintain,rehabilitate,replace and augment these the Engineering Planning Division has been working on valuable wastewater assets in the most cost effective developing a medium to long-term(up to 20 years) (lowest life cycle cost)sustainable manner at the level Capital Improvement Program(CIP)by creating of service required by present and future generations of specific project plans for the refurbishment, regulators and customers at an acceptable level of risk." rehabilitation or replacement for each asset area. The District is committed to providing services for its This medium-term management is important for rate payers to reliably meet our regulatory mandates and several reasons.By moving away from narrowly levels of service approved by the Board of Directors,and focused projects to solve individual problems,to more will provide these services using sustainable engineering comprehensive projects refurbishing entire processes, principles that result in the lowest responsible lifecycle OCSD benefits by having less operational disruption cost. The District installs,operates,maintains,refurbishes and more efficient project delivery,better cash flow and disposes of assets with liferydes measured from years estimation,and better operations and maintenance to decades,so an approach which balances long,medium decision-making framework. This is a huge undertaking and short-term needs is necessary. based on the number of asset and facilities,but over time the undefined future rehabilitation capital Asset management has evolved into a comprehensive estimates within the twenty-year window is expected decision-making framework that encompasses to be drastically reduced and replaced by more specific engineering planning,design and construction estimated capital needs. of quality facilities,optimized operation,proper maintenance,and planned refurbishment and disposal Complementing the medium-term planning are the that will meet the District's changing needs. This short-term efforts to coordinate maintenance actions that coordinated decision making process will allow the can reduce risks,actively defer the larger refurbishment District to consistently meet mandated levels of service projects,and reduce asset consumption rates to minimize to the rate payers at the lowest lifecycle cost. the need for replacement of structures and conveyance systems when projects are executed. The Planning The District's Asset Management Plan focuses on the Division asset engineers are constantly reviewing long-term modeling of systems to ensure the proper rate their area scopes of work,utilizing their criticality and structure is in place to support sustainable operations condition information and engineering judgment,to and to prioritize condition assessment studies based on identify opportunities for operational adjustments or service life and service conditions.These are important maintenance activities that cost effectively extend the starting points and have yielded tangible benefits in life of key assets which may allow for deferral of the reduced risk levels and an improved capital planning larger overall project. This maybe a targeted equipment approach.The results of the long-term modeling replacement or pipeline repair that is more urgent than are completely dependent on the data quality of the the need of the overall facility. These engineers may databases supplying information to the TeamPlan also identify opportunities to reduce asset consumption Software.Staff continues to improve the data quality through coating systems,atmosphere improvements of the source systems to improve the accuracy of the or small structure repairs before major damage is done. long-term model.The implementation of the Maximo These actions can drastically reduce the cost of future Computer Maintenance Management System(CMMS) projects by preventing the need to demolish and replace is an example of an effort to improve OCSD's Asset entire structures. Register.CMMS Technicians and the Asset Engineers continue to work to update the database information 12 FISCAL YEARS 2010-17 AND 2017-18 BUDGET The District is committed to continuous improvement replacement obligation is rising,and as a consequence, of the process by which it manages the assets and OCSD needs to plan for decreased capital projects for facilities that are required to reliably deliver its level expansion and increased renewal expenditures in the of service commitments. The additional resources future relative to past expenditure levels.Additional and individual accountability for specific areas has focus will need to be given to ensuring that appropriate improved,and will continue to improve our capital operation and maintenance strategies are being applied planning,project packaging,project execution and that consider the different ages of assets delivery,plant operability and maintenance planning. being maintained. The average age and value of the assets OCSD own is increasing steadily over time,the latent asset JFr WIL am A ;"�_dnat�5.1�a' -�-- I� 1 ORANGE COUNTY SANITATION DISTRICT EXECUTIVE SUMM -FISCAL YEARS 2016-17 AND 201 13 INFRASTRUCTURE ASSET MANAGEMENT Asset Valuation The 2012 replacement value is estimated to be $6.20 billion.In 1998 the prediction was$2.03 billion, The replacement valuation for all of OCSD's assets has which was based on original purchase cost.It is been updated.The table below presents the current projected that the replacement value will increase by replacement and depreciated values of OCSD's assets. approximately$7.1 billion when all of the existing three The replacement value represents the cost in December billion dollar CIP has been captured in the District's 2009 dollars to completely rebuild all the assets to a new database. The major reasons for this increase are all the condition. The depreciated value is the book value of new assets added to the asset register and the increased the assets based on their age,which is a prediction of replacement costs due to now having to perform their current condition. construction in a more urbanized Orange County than Valuation plants Collection Total in the past. Replacement $3.11 $3.09 $6.20 Planned CIP Outlays Value(in billions) The following chart shows the 20-year CIP outlay Depreciated $1.88 $1.88 $3.76 which includes current and predicted future Capital Value(in billions) Improvement program projects. 20 YEAR CIP OUTLAY $350 $300 $250 o $200 E c_ $150 $1o0 $50 $0 q't' �ti ; ^iy P y b" N a, of c5 '' ti M R h F F F F 4'" e" F" ¢' F+' F' F+' ¢' ¢' FISCALYEAR Budget CIP Future CIP Rehabilitation or Replacement 14 FISCAL YEARS 2010-17 AND 2017-18 BUDGET With the completion of the$537 million full secondary . Completed 2,900 inspections of 15 pump stations and treatment expansion program,our capital improvement 3 metering facilities. and maintenance programs are now more focused on maintaining our infrastructure to ensure that our • Completed 57 facility safety inspections. mission is delivered reliably and that our facilities are . Completed 56 pump station wet well and 12 Plant No. managed in a way that minimizes overall life cycle costs. 2 headwork cleanings. Below is a status of the fiscal year 2015-16 infrastructure • Completed 296 pump station preventative pump maintenance activities and planned activities for fiscal cleanings. year 2016-17. • Completed 487 pump station mechanical preventative Collection System: maintenance tasks. OCSD's collection system consists of 570 miles of • Cleaned 70 trouble spots and 346 inverted siphons. sewers broken down by 170 miles of large regional . Cleaned 94 miles of local sewer pipelines. sewers currently not on a cleaning schedule due to their size,230 miles of regional sewers on a cleaning schedule . Repaired 2,380 feet of local sewer lines. and 170 miles of local sewers in Area 7 scheduled to be transferred to the Fast Orange County Water District in • Completed 260 miles of pipeline video inspections. August 2016;and 15 pump stations and three metering . Completed 213 manhole video inspections. locations that must be maintained,repaired,and upgraded to maintain wastewater service and to convey . 1,277 dry tons of caustic soda slug dosed. sewage to our treatment facilities. Typical collection system maintenance activities consist o@ televising, • 21450 dry tons of magnesium hydroxide continuously inspecting,and cleaning sewer lines;operating, dosed. maintaining and cleaning pump stations with associated , 4,000 dry tons of ferrous chloride continuously dosed. facilities;and chemical conditioning of the sewage to reduce corrosion and control odors.Maintenance • 180,000 gallons of calcium nitrate continuously dosed. activities are based on established levels of service to ensure compliance with our Sewer System Management Total costs:$6,792,304 Plan,reducing spills,increasing reliability and safety, The following activities and goals are planned for fiscal and ensuring that our facilities are managed operated year 2016-17: and maintained to minimize overall life cycle costs and need for repairs.The cleaning frequencies are based • Clean 60 miles of regional sewer lines on a cleaning on data from pipe inspections,closed-circuit television schedule. (CCTV)work historical records,and industry best practices.The planned activities help extend the useful • CCTV video inspection of 500 regional system life of the assets and minimize nuisance odors. manholes. Maintenance activity tracking will change during the • CCTV video inspection of 80 miles of regional sewer 2016-17 fiscal year to reflect various changes and best pipeline. practices within our system.In addition,the Area 7 . Complete at least 95%of scheduled pump station local sewers are tentatively scheduled for transfer preventative maintenance work starting August 2016.The Area 7local sewer data will be excluded from the metrics values. • Clean 95%of trouble spot and scheduled inverted siphon work. During fiscal year 2015-16 the following maintenance activities were completed: • Manage odor control chemical expenditures to between 95-102%of budget. • Cleaned 41 miles of regional sewer lines.Completed rapid manhole inspection of 860 regional manholes. Estimated total costs:$8,864,300 15 INFRASTRUCTURE ASSET MANAGEMENT Collection System Capital have developed,making the pipe difficult to clean,and Improvement Projects over time may impede the wastewater flow.Portions of the project will be relined and others will be replaced Our collections projects go through an intensive with larger diameter pipelines.Also,over 150 manholes planning and design process to ensure all elements will be replaced.In addition,the Westside Pump Station of the project are thoroughly assessed.These projects will undergo some improvements,the aging pump typically renew or replace aging pipelines and pump station needs a new wet well and odor control measures. stations,upgrade facilities to meet current codes and This project budget is$217 million. standards,and in some instances to increase flow capacity due to growth in localized portions of our At the southern edge of the previously mentioned service area. project,the Seal Beach Pump Station(Project No.3-62) also needs to be rehabilitated to properly support the We are currently planning and executing a western region of our service area.Not only are the comprehensive program to renew our collection system. electrical and safety codes significantly different from One of the larger projects is the Newhope-Placentia when the station was first constructed in the early 1970s, Trunk Replacement(Project No.2-72)which is taking but many of the electrical,mechanical,and control place in the cities of Fullerton and Anaheim.Seven system components are becoming obsolete,so long- miles of sewer along State College Boulevard,from term maintenance is no longer an option.The two Yorba Linda Boulevard to Orangewood Avenue,will force mains downstream of the pump station will also be upsized to handle the flow necessary to allow the need to be addressed.One force main will be replaced abandonment of the Yorba Linda Pump Station which and the other rehabilitated to properly support the has reached the end of its useful life.After analyzing the updated facility. Odor control facilities will be added to system,it is not practical to update the facility due to the reduce system corrosion and minimize public impacts. high costs of rehabilitation and the limitation to utilize This project is currently in the design phase with the flow for reclamation.Currently,flow is diverted construction anticipated for 2015.The budget for this into the Santa Ana River line instead of the Newhope- project is$61 million. Placentia line due to the existing insufficient capacity, thus preventing the use of flow for the Groundwater In the cities of Santa Ana,Tustin,and Irvine,we have Replenishment System. The project will also include the Gisler-Red Hill Trunk Improvements(Project No. modifications to existing diversion structures to add 7-37)which is rehabilitating or replacing aging parallel flexibility to the collection system to divert other sewer lines.The current pipes,which run along Red Hill reclaimable flow. This project also provides adequate Avenue between McGaw Street and Mitchell Avenue, capacity for future development,minimizing the risk of are not large enough to handle the high flows associated sewer spills in the future.Construction efforts started in with wet weather events which create the risk of spills. May 2016 and the fast phase of the project is scheduled The manholes are also deteriorated and corroded and to be completed by fail 2017.The project has a current must also be replaced or rehabilitated to avoid failure. budget of$99 million. The two-mile project has a current budget of$25 million and began construction in May 2016. Another large scale project is the Rehabilitation of the Western Regional Sewers(Project No.3-64)which In Newport Beach,we have developed a comprehensive covers approximately 17 miles of sewers in the cities of Program to coordinate the various projects scheduled to Anaheim,Buena Park,Cypress,La Palma,Los Alamitos, take place in the city in the next few years.We recently Seal Beach and unincorporated areas of the County completed construction of the Newport Force Main of Orange referred to as Rossmoor. This large project Rehabilitation Project(No.5-60),which rehabilitated is required to rehabilitate or replace pipes that were and replaced parallel pipes in Pacific Coast Highway installed 45 to 55 years ago.The sewers have multiple between Dover Drive and just west of Superior Avenue. deficiencies which have allowed the intrusion of ground The project was sequenced in two phases to minimize water primarily at the joints,but also sporadically along public impacts by avoiding construction in the busy the pipe segments. In some cases,hard calcium deposits summer months.The 50-year steel pressurized mains 18 I I I I 1 I all 1141 20 •I� Le � I I �I �ii' . '��. i ♦nK•wt'• '"" INFRASTRUCTURE ASSET MANAGEMENT were in poor condition and one of the pipelines was . Completed major service on four of nine blowers undersized to convey predicted wet weather Flows. Now that provide oxygen to the microorganisms in the completed,the system should provide another 50 years secondary treatment process. of service.The project had a budget of$64 million. Replacement of the control system for emergency back- Also in the City of Newport Beach and in portions up power generators that service our activated sludge of Costa Mesa,we have the District 6 Trunk Sewer secondary treatment facilities,originally planned for Relief Project(No.6-17).This project is replacing the fiscal year 2015-16,was made part of the Headworks sewer that extends from Pomona Avenue to Newport Rehabilitation Capital Improvement Project scheduled Boulevard ending near Pacific Coast Highway.These for completion in 2020.Additionally,replacement of improvements will increase capacity to properly outdated atmospheric monitoring equipment in the handle the projected increase in Flow from planned digesters and central generation facility areas originally developments.These improvements will extend the life scheduled for this year was deferred to fiscal year of the sewer by 30 years.Once the project is completed, 2016-17 due to changing priorities. the risk of sewer spills during dry weather events and common wet weather events will significantly diminish. Total costs:$3,827,885 The current budget for the project is$8 million. During fiscal year 2016-17,there are more than 4,900 Reclamation Plant No. 1: preventative maintenance activities that are scheduled to be completed at Plant No.l.These include typical time Flow from Reclamation Plant No. 1 is delivered to the or cycle based maintenance tasks such as adjustments Orange County Water District(OCWD)for recycling and mechanical alignments,cleaning and tightening of via the Ground Water Replenishment System(GWRS). electrical equipment,calibration of sensors and meters, During 2015 the expanded plant came on line,with changing of lubricants and filters,exercising equipment, capacity to deliver an additional 30 million gallons per rebuilds and regulatory testing.In addition,staff will day for a total of 130 million gallons per day. be utilizing predictive technologies such as vibration analysis to measure imbalance in rotating equipment, During fiscal year 2015-16,more than 4,200 preventative thermography to measure excessive heat,oil analysis maintenance activities were performed at Plant No. 1. to predict failure of lubricants,and ultrasonic to detect In addition to these routine activities,the following leaks as well as deterioration and short-circuiting in maintenance and repair activities were completed electrical equipment.Other major planned activities for during the year: fiscal year 2016-17 at Reclamation Plant No. 1 include: • Completed the arc flash evaluation project to ensure . Completion of the arc flash and protective relay the safety of workers servicing electrical equipment. work,including labeling of assets and acting on • Continued assessment and evaluation of proper recommendations from the evaluation completed settings of protective relays to ensure the safety of last year,to ensure the safety of workers servicing electrical equipment. workers servicing electrical equipment. . Replacement of eight foul air scrubber atmospheric • Initiated steps to replace the foul air scrubber analyzer units that monitor compliance with South atmospheric analyzer units that monitor compliance Coast Air Quality Management District(SCAQMD) with South Coast Air Quality Management District requirements and feed chemicals into the scrubbers. (SCAQMD)requirements and feed chemicals into the scrubbers including completing a service contract to . Major overhaul of one Central Generation(CenGen) optimize installation and purchasing of analyzer units. Engine. . Rebuilt one of the four Steve Anderson Lift Station . Overhaul of one cake conveyor and one belt press for pumps that transfer Flow tributary to Treatment Plant biosolids dewatering. No.2 into Reclamation Plant No. 1. . Major service on two blowers that service the ASl secondary treatment facility. 18 FISCAL YEARS 2010-17 AND 2017-18 BUDGET . Replacement of the vane bushings on three of the A project closely tied to the solids dewatering facility is ASl blowers. the Digester Rehabilitation(Project No.P1-100)which is rehabilitating 12 digesters.The project will refurbish . Servicing of emergency generators to ensure aged storage tanks,as well as handle the increased continuity of operations. volume of solids more efficiently and with greater . Replacement of 23 outdated atmospheric monitoring reliability.The sludge pumping,heating,structural, units in the digester facility areas. mechanical,and electrical and control systems will all be rehabilitated,which will increase the quality of Total estimated costs:$5,105,970 the sludge production.By rehabilitating our existing digesters,we reduce the risk of failure and extend the Reclamation Plant No. i Capital life of the assets,minimizing future expenditures.The Improvement Projects: total project budget is$67 million. These projects are intended to rehabilitate or reconstruct Treatment Plant No. 2: major components of our treatment process to ensure compliance with regulatory permits,and enhance water All flows entering Treatment Plant No.2 are treated recycling and safety. to full secondary standards and then discharged four miles offshore through our ocean discharge outfall. One of the largest projects currently being designed During fiscal year 2015-16,the number of process is the Headwork Rehabilitation at Plant No. 1 units in service at Treatment Plant No.2 was reduced (Project No.P1-105).The facility is almost 30 years as additional flow was diverted to Reclamation Plant old,so a comprehensive refurbishment is required No. 1 in support of the expanded GWRS. Average flow in order to extend the life of the facility. The project treated at Plant No.2 was 65 million gallons per day. In will rehabilitate systems including the metering and addition to more than 3,600 preventative maintenance diversion structure,the bar screen building,the bin activities completed during fiscal year 2015-16,the loading building,the main sewage pump station, following major activities were also completed at the grit basins,the primary influent channels,the Treatment Plant No.2 during the year. headworks odor control scrubbers,and electrical power distribution and control systems.This project will also • Completed the arc flash evaluation project to ensure replace the emergency pumping capacity that has been the safety of workers servicing electrical equipment. provided by the original headworks pumping system , Continued assessment and evaluation of proper dating back to the 1950s.The total budgeted cost for this settings of protective relays to ensure the safety of project is$275 million. workers servicing electrical equipment. While the Sanitation District generally has adequate , Completed major overhaul on one of five central hydraulic treatment capacity,additional solids handling generation engines that supply two-thirds of the capacity is needed.The Sludge Dewatering and Odor power for the treatment plant. Control Project(No.P1-101)is necessary to support the need for more capacity to thicken and dewater sludge . Overhauled two of the three gas compressors that due to the conversion to full secondary treatment as well provide digester gas to the central generation facility as increase flow to support the expansion of the GWRS. for producing electrical power and heat. The 40-year old system has reached the end of its useful life and,as such,will be replaced with a new and • Initiated steps to replace the foul air scrubber improved facility that will increase cake dryness,which atmospheric analyzer units that monitor compliance will reduce biosolids management cost.This will,in with South Coast Air Quality Management District turn,improve sludge thickening to optimize the use of (SCAQMD)requirements and feed chemicals into the existing digesters thus eliminating the need to construct scrubbers including completing a service contract to new digesters.The project will also help us meet our optimize installation and purchasing analyzer units. level of service goal by reducing odors.The project budget is just under$188 million. 10 INFRASTRUCTURE ASSET MANAGEMENT • Cleaned and replaced mechanical equipment on two Treatment Plant No. 2 Capital digesters to improve mixing and detention time to Improvement Projects: ensure the best possible reclamation of the biosolids. • Removed debris from the by-pass flap gate discharge The Primary Treatment Rehabilitation Project(P2-98) point into the Santa Ana River to ensure availability of will rehabilitate the primary clarifiers,influent pipes, this discharge in the event of an emergency. construct new primary effluent pipes,and rehabilitate and upgrade the odor control systems.These facilities Replacement of outdated atmospheric monitoring date back to the late 1950s and are in need of seismic equipment in the digesters and central generation and condition based upgrades. By replacing old facility areas,originally scheduled for this year, structures and installing new systems,we will improve was deferred to fiscal year 2016-17 due to the resiliency of our infrastructure and thus improve changing priorities. our ability to provide service.This is anticipated to be a Total costs:$5,124,823 very long duration project because the need to maintain During fiscal year 2016-17,there are more than 4,300 treatment operations during the project. The total preventative maintenance activities that are scheduled Project budget is$428 million. to be completed at Treatment Plant No.2.These include Treating 100 percent of our influent to full secondary typical time or cycle based maintenance tasks such treatment standards means there are more solids to as adjustments and mechanical alignments,cleaning manage which has generated several projects to address and tightening of electrical equipment,calibration of that need.A few are currently underway such as the sensors and meters,changing of lubricants and filters, Solids Thickening and Processing Upgrades(Project exercising equipment,rebuilds and regulatory testing. No.P2-89)which will be completed at the end of the In addition,staff will be utilizing predictive technologies year.The Sludge Dewatering and Odor Control project such as vibration analysis to measure imbalance in (No.P2-92)has started construction to replace the rotating equipment,thermography to measure excessive current belt press dewatering system with a centrifuge heat,and oil analysis to predict failure of lubricants.In dewatering facility that will remove a greater amount addition to planned preventative maintenance,other of water from the sludge resulting in reduced disposal major planned activities at Treatment Plant No.2 for costs for the Sanitation District.This$90 million project fiscal year 2016-17 include: will be in construction through 2018. • Completion of the arc flash and protective relay As we make improvements throughout the plant,it work,including labeling of assets and acting on is imperative we pay attention to our ocean outfall recommendations from the evaluation completed systems.Many components of the system such as the last year,to ensure the safety of workers servicing pipeline assets have already been addressed,so now electrical equipment. we turn our attention to the pumping systems.Project • Replacement of foul air scrubber atmospheric No.J-117,the Ocean Outfall System Rehabilitation, analyzer units that monitor compliance with South will refurbish the Ocean Outfall Booster Station. This Coast Air Quality Management District(SCAQMD) includes rehabilitation of the mechanical,electrical,and requirements and feed chemicals into the scrubbers, civil systems which will extend the life of the facility and as required. increase the efficiency of the system. In addition,a low • Clean and replace mechanical equipment on two flow pump station will be added due to our increased digesters to improve mixing and detention time to water recycling rates,which will reduce our outfall flows ensure best possible reclamation of the biosolids. below the capacity of the current very large pumps.The budget for this project is$88 million. • Replacement of five outdated atmospheric monitoring equipment in the digesters facility areas,as required, As part of the long-term CIP planning efforts,several and complete replacement in the central generation studies are currently underway evaluating various facility areas. areas of the plants and the collection system to Total estimated costs:$4,291,204 determine their condition,and identify deficiencies 20 FISCAL YEARS 2010-17 AND 2017-18 BUDGET or improvements needed.These studies include the Planned activities for fiscal year 2016-17 for CAMP Primary Treatment Area Study and the Bay Bridge include the following: Pump Station Relocation Study to help identify how to best address and manage the improvements for these • Follow the CAMP Five-Year Plan by area and,for two important components of our system.We also have each area,identify the assets,adding preventative studies focusing on topics such as:Effluent Reuse,which maintenance tasks for each asset into Maximo. coincides with Board of Director's strategic goal for . Continue to update the Reliability Maintenance Data future water recycling;the Odor Control Master Plan, Management System. which will help identify areas of improvement to better define our level of service;and the Biosolids Master . Continue to update the Reliability Maintenance Plan.As these studies evolve,projects will be refined or Housekeeping Plan,including the addition of created to improve our systems. an equipment rotation plan and a cleaning and Civil Assets Maintenance flushing plan. Program • Pipeline cleaning and vactoring. The Civil Assets Maintenance Program(CAMP) • CCTV inspections. covers the predictive,proactive,and corrective . Cathodic protection and coatings. maintenance tasks for all OCSD assets at all its facilities located at Plants No. 1 and No.2,as well . Corrosion assessment and support. as all OCSD pump stations and its entire collection system to insure that OCSD civil assets meet design Estimated total costs:$2,471,000 life expectancy and will complement the existing maintenance programs for mechanical,electrical and instrumentation maintenance.In addition,the plan ensures the assessment of all of primary and critical equipment required to meet OCSD's main mission of protecting the public health and environment.Besides developing in-house capabilities to better monitor and maintain these assets,the program entails utilizing consultants and contractors for program development and implementation.Repairs of the assets are planned and scheduled based on condition and criticality,and performed by staff or contracted services. During fiscal year 2015-16,CAMP completed the following activities: . Development of a Five-Year Plan • Development of Reliability Maintenance Data Management System:developed an overall system architecture to track and locate all asset data through the Maximo Computerized Maintenance Management System(CMMS). . Development of a Reliability Maintenance Housekeeping Plan,including a valve and gate exercising program. Total costs:$200,000 21 CAPITAL IMPROVEMENT PROGRAM CIP Budget Request Summary process,each project's schedule,staff resources,total project cost,cash flow and risks are assessed to confirm Each year,the Board of Directors,through their the budgetary requirements.The validated CIP includes committee process,reviews and approves the Capital 81 active and future capital projects with a 10-year Improvement Program(CIP)prepared by staff for both expenditure of$2.4 billion. sewage collection system projects(collections)and the joint works treatment and disposal system projects. The proposed 2016-17 CIP budget is organized by treatment process. The funds requested for the current Many of the District's projects take several years to CIP budget total$190.3 million,which is part of an complete the planning,design and construction cycle. overall total CIP budget of$3.3 billion for active and The budget for a construction project covers the life future projects. of the project. This budget is reevaluated each year for the purpose of managing annual cash flows. Thus, Following is a table of the fiscal yen 2016-17 proposed many of the projects in the CIP Budget for 2016-18 are CIP budget,by project phase,in millions: continuing projects that were approved in prior years. 2016-17 The Asset Management Program,within the Planning Project Status CIE Budget Division,continues assessing the condition of the Planning $ 11.0 District's existing assets and systems to ensure that these Design 52.3 assets and systems can provide the necessary level of Construction 127.0 service. The Planning Division will continue to review Total Gross CIE Budget 190.3 and update the ongoing and future CIP to appropriately Less:Savings and Deferrals (19.0) manage the risks associated with asset or system failure. This year several projects were delayed,consolidated CIP Net of Savings/Deferrals $ 171.3 and rescoped to help ensure that the CIP is delivered in the most efficient way possible.The Asset Management There are currently 11 projects in the Planning Phase Program will continue these efforts and will continue to with proposed capital outlay spending in 2016-17.Two define the future CIE project requirements not currently of the larger 2016-17 cash flow projects in the Planning included on the CIE list but are anticipated within the Phase are the Process SCADA Replacement Study and long-term financial plan to ensure effective and efficient the Biosolids Master Plan,which is one of the planning operations in the future. studies within the Master Studies Program.The current year projected expenditures for these two projects are Four new projects are proposed for addition to the $1.3 million and$2.9 million,respectively. 2016-2018 budget to rehabilitate the Gisler-Red Hill Currently,there are 39 projects in the Design Phase Interceptor,relocate the Banning Gate at Plant No.2, with proposed capital outlay spending in 2016-17. improve odor at various Newport Beach pump stations, The two largest projects in the Design Phase are the and evaluate the steps necessary to replace District's process SCADA system.These CIP projects increase Rehabilitation of Western Regional Sewers and the the amount of the CIP by$15.9 million.However,these Headworks Rehabilitation and Expansion at Plant projects will be funded from OCSD's existing budget No. 1 with projected current year expenditures of$16.0 and will not impact OCSD user rates. million and$6.7 million,respectively. In conjunction with preparation for the 2016-18 Budget, There are currently 31 projects in the Construction District staff have developed and reviewed with the Phase with proposed capital outlay spending in Board of Directors a capital program to deliver the 2016-17.The two most significant projects in the levels of service included in the District's Five-year construction phase are the Sludge Dewatering and Odor Strategic Plan. Control at Plant No.2 and the Newhope-Placentia Trunk Replacement with projected fiscal year 2016- District staff has also validated all active and future CIP 17 expenditures of$23.5 million and$20.9 million, projects to ensure that the project scopes of work and respectively. cost estimates were accurate. Through the validation 22 FISCAL YEARS 2010-17 AND 2017-18 BUDGET Standard contingency factors have been applied to improve cost estimates.The rates of 30,20,and 10 percent have been applied respectively to the estimates made during the project development,design,and construction project phases. This reflects standard practice for estimating construction project costs. Each project went through an extensive validation and prioritization process.Projects have been prioritized based on risk exposure.Projects that would present a higher risk or disproportionally higher future cost if they were delayed are given a higher priority. FISCAL YEAR 2016.17 FISCAL YEAR 2017.18 CIP Outlays by Process CIP Outlays by Process Total = $190.3 Million Total = $153.0 Million Support $15.7M Support Improved 3% Improved $1 Treatment Treatment 13.0% .0% $32.6M $30.3M 17.1% 19.8% Additional Additional Capacity Capacity Replacement/ $19.1M $44.SM Rehabilitation 12.5% 23.5% $972M Replacement/Rehabilitation 51.1% $83.71V 54.7% -FISCAL YEARS 2016-17 AND 2017-18 23 DEBT FINANCING PROGRAM Debt Financing Dedicated Funding Source Due to the potential magnitude of the capital In 1992 and 2004 the Board of Directors formalized the improvement program,it may be necessary that dedication of certain funding sources. To ensure the the District utilize debt financing to meet its total continuation of favorable credit ratings,revenues were obligations.Debt financing allows the District to meet dedicated to debt service in the following order: projected construction schedules while achieving the lowest possible user fees,as well as long-term stability in 1. Ad valorem property taxes future sewer service fee rates. 2. Sanitary sewer service charges 3. Other revenues Certificates of Participation This apportionment of the ad valorem tax was (COP) consistent with and pursuant to the Revenue Program The primary debt financing mechanism used is adopted in April 1979 to comply with regulations of the Certificates of Participation(COP).COPS are Environmental Protection Agency and the State Water repayment obligations based on a lease or installment Resources Control Board and in accordance with COP documents and Board policy. sale agreement The COP structure was selected over other structures because COPS are not viewed as debt by The District Maintains AAA Bond the State of California,as the purchaser does not actually receive a"bond,"but rather a share in an installment Rating sale arrangement where the District serves as the The DistricPs bond rating is"AAA"from both Standard purchaser.COPS can be issued with fixed or variable &Poors and Fitch Ratings.An"AAA"Rating is the interest rates. highest for a government agency.In order to maintain As of July 1,2016,the total outstanding COP this rating,the District adheres to its debt policy and indebtedness will be$1.1 billion. coverage ratios requirements.This Board-adopted policy serves as the agency's guide in the management Build America Bonds Financings of existing debt and in the issuance of future debt. The District issued the$80.0 million Wastewater Debt Ratios Revenue Obligations,Series 2010A in May 2010 and the $157.0 million Wastewater Revenue Obligations,Series The District has contractual covenants within the 2010C in November 2010 as"Build America Bonds" existing COP agreements which require minimum (BABs)fixed rate debt. coverage ratios of 1.25.The minimum coverage ratio is the ratio of net annual revenues available for debt The American Recovery and Reinvestment Act of service requirements to total annual debt service 2009 created a new financing product,BABs,for the requirements for all senior lien COP debt.The coverage municipal issuer. BABs are issued as higher interest ratio for senior lien COP debt is being proposed to taxable bonds;however,the U.S.Treasury provides a remain above 3.00 for fiscal years 2016-17 and 2017-18. 35 percent subsidy on interest payments. The net cost, after accounting for the 35 percent subsidy payment, Future Financings frequently results in lower net costs to the issuer, specifically in the maturity years beyond ten years. No new money debt issuances are being proposed over the next two fiscal years as the$2.4 billion in future On March 1,2013,the federal government implemented replacement,rehabilitation,and refurbishment projects certain automatic spending cuts known as the sequester. anticipated over the next ten years will be adequately As a result of the sequester,federal subsidy payments funded through current sewer service fee charges and on BABs were reduced by 8.7 percent,7.2 percent, existing reserves. 7.3 percent,and 6.8 percent for the federal fiscal years ended 2013,2014,2015,and 2016,respectively. 24 R / I . � r J6 v� yvr � _ +. �► It f �E �lOW OPERATING EXPENSES Summary of Operating and Maintenance Expenses (in millions) 2014-15 2015-16 2016-17 2017-18 Category Actual Projected Proposed Proposed Salaries and Benefits $94.2 $89.9 $89.3 $90.6 Contractual Services 22.2 23.5 24.8 22.6 Operating Materials&Supplies 15.4 16.4 16.7 17.4 Repairs and Maintenance 11.6 13.4 14.2 16.1 Utilities 7.2 8.5 8.9 10.2 Professional Services 3.2 3.0 4.2 4.2 Other Materials,Supplies,Services 1.7 1.7 3.4 3.8 Self-Insurance Requirements 2.2 2.5 2.5 2.6 Administrative Expenses 1.4 1.5 1.8 1.8 Training and Meetings 0.8 0.8 1.2 1.2 Research and Monitoring 0.8 0.7 0.8 0.9 Printing and Publications 0.3 0.3 0.3 0.4 Cost Allocation (17.3) (18.3) (19.2) (19.4) Total Operating Expenses $143.7 $143.9 $148.9 $152.4 Salaries, Wages & Benefits - croup Insurance-These expenses include OCSD's $89.3M share(approximately$13,900 per employee)of employee medical plan benefits for the indemnity plan, Salaries&Wages-The proposed budget for Full Time prepaid HMO plans,dental insurance plan,and life and Equivalent(FTE)positions for both 2016-17 and 2017- disability insurance premiums.The proposed budget 18 reflects an increase of three FTEs from the 2015-16 includes a 5.0 percent increase for medical plans over approved staffing level of 624.0 FFEs to 627.0 FFEs. the prior year projected. Provision has been made in these salary projections to comply with the terms of the most recently adopted Contractual Services - $24.8M Memorandums of Understanding. The treatment plants currently produce about 775 wet Retirement-OCSD employees are members of tons per day of biosolids which are recycled in the Orange County Employees'Retirement System California and Arizona.Nearly 50 percent of biosolids (OCERS).Information from OCERS indicates that are currently allocated to composting,40 percent is used the employer's required contribution rates will be on farms for soil enrichment,and 10 percent is sent to decreased in fiscal year 2016-17 from 20.75 percent a local landfill that produces methane. In 2016-17 to 13.09 percent as a result of the District's additional and 2017-18,biosolids budgets will be approximately payment in 2015-16 to reduce the unfunded actuarial $17.2 million and$14.0 million respectively, accrued liability.In addition,OCSD pays 3.5 percent of approximately 69 percent of the Contractual Services the employee required contribution. budget. Other residuals solids and waste includes disposal costs for grit and screening waste,digester cleaning waste,and hazardous materials. 20 FISCAL YEARS 2010-17 AND 2017-18 BUDGET This category also includes appropriations for grounds Planned repairs include:digester cleaning($1.3M); keeping,janitorial,security,toxic waste removal,outside CenGen engine overhaul($1.3M);service of aeration laboratory,trash pickup,plant site sweeping,closed blowers($400K);electrical protective relay maintenance circuit television pipeline inspections,line cleaning,and ($325K);interplant gas line maintenance($185K);and temporary services. emergency generator maintenance($150K). Operating Materials & Supplies - Utilities - $8.9M $16.7M During fiscal year 2016-17,the overall cost for utilities, Chemical Coagulants-Anionic polymer is added to a significant component of the operating budget,is the influent wastewater along with ferric chloride to anticipated to increase by 5.2 percent over the projected improve solids removal efficiencies in the primary 2015-16 costs and then increase by$1.3 million,or clarifiers.Ferric chloride is also added to the digesters 14.8 percent,in 2017-18. for solids odor control.Cationic polymer is added Natural Gas-Natural gas is purchased from two to digested sludge prior to dewatering to aid in providers for different purposes.Purchases from a gas coagulation,improving the sludge and water separation process.Cationic polymer is also added to the waste marketer are used to supplement the digester gas that activated sludge dissolved air flotation thickeners is used to run the Ce budgeGen facilities.The fiscal year (DAFTs)to improve solids coagulation. higher t natural gas budget is 5- 1 costs 5.3 percent higher than the projected 2015-16 costs. With the The costs for this group of chemicals are expected to new emission control systems installed on all GenGen decrease by$879,000(14 percent)in 2016-17 printarfly engines,natural gas usage is expected to increase during due to the award of new purchase agreements for ferric the summer months in order to reduce peak electricity chloride with lower pricing. demand. Odor Control Chemicals-The District uses hydrogen Electricity-Electricity is the largest utility cost incurred peroxide,sodium hydroxide(caustic soda),sodium by OCSD.Purchased electricity is used in running the hypochlorite(bleach)and muriatic acid as the primary plant processes as a supplement to power produced in odor control chemicals in the treatment plants.Ferrous the central generation facilities. chloride,magnesium hydroxide,calcium nitrate,and The 2016-17 proposed budget is five percent higher caustic soda are the primary odor control chemicals than the 2015-16 projected costs due to rate increases. used in the collection system. The costs are expected to further increase in 2017-18 by The 2016-17 and 2017-18 budgets for these chemicals $1.2 million due to the startup of the sludge dewatering are$8.2 million,and$8.7 million,respectively. The facilities and a projected four percent rate increase. collection system chemical costs are expected to increase With the completion of the emission controls system due to the replacement of Irvine Ranch Water District installation,staff have the opportunity to optimize (IRWD)injection points using ferrous chloride with an power usage by either purchasing supplemental natural injection point using the more expensive magnesium gas or electricity,whichever costs less. hydroxide and calcium nitrate to mitigate collection system odors. Water-Water is used throughout the treatment plants. Repairs and Maintenance — Potable(drinking)water is supplied by the Cities of p Fountain Valley and Huntington Beach;reclaimed $14.2M water is supplied by the GAP;and plant water is This item,which is for parts and services for repair disinfected secondary effluent. of plant and collection facilities and annual service . GAP water is secondary treated effluent from contracts,is expected to increase by approximately the Sanitation District that is further treated by $839,000 or 6.2 percent in 2016-17,followed by an the Orange County Water District.GAP water is increase of 1.9 million or 13.3 percent in 2017-18. significantly less expensive than potable water and is 27 OPERATING EXPENSES used in the process wherever possible.The major uses flood,subject to a self-insurance retention of$250,000. of GAP water include cooling water,solids handling, The District is partially self-insured for earthquake, and landscaping.By agreement,OCSD receives up but does carry$25 million in coverage on seven key to 1,120 acre feet per year of GAP water at no charge. structures with a$5 million deductible.The District The proposed budget is$5,000 for each of the next also has a$50 million sublimit for builder's risk under two years. the property insurance program to ensure upcoming . Potable Water-The potable water budget includes construction projects are adequately covered. water supplied by the City of Fountain Valley for An appropriation of$1.1 million for in-lieu premium Plant No. 1 and the City of Huntington Beach for contribution charged to operations is recommended for Plant No.2.Approximately five percent of the potable the Property and General Liability Program. water at Plant No. 1 is used for domestic uses and less than one percent is used for irrigation.The majority of This will serve to maintain the reserves balance. the irrigation at both plants uses reclaimed water.Less Administrative Expenses - $1.8M than one percent of the potable water used at Plant No.2 is for domestic uses due to the relatively small These accounts include supplies,postage,technical number of employees at Plant No.2.The proposed journals and publications,forms,small office total potable water cost for 2016-17 is$646,000,a three equipment,and small computer items that cost less than percent increase from the projected 2015-16 costs. $5,000 per item and exclude items that are capitalized. Professional Services - $4.2M Training and Meetings - $1.2M Professional Services includes General Counsel,special Board member and staff travel has been significantly labor counsel,audit and miscellaneous accounting reduced in recent years.This category also includes services,legislative advocacy,engineering,and other meetings of professional societies;ongoing technical technical consulting services. training and materials for staff;training for computerized plant monitoring and control systems, Other Material, Supplies, MAXIMO(a computerized maintenance management Services - $3.4M system),Enterprise Resource Planning(ERP),and This category of costs includes the in-lieu insurance other"high tech"equipment,processes and systems; and training to allow for an adaptive and flexible work premium used to maintain the level of accumulated force.While OCSD continues to place an emphasis reserves for the property and general liability self- insurance programs.This in-heu cost for 2016-17 is effective safety training, well as technical,leadership proposed at$1.1 million. and management training,the training budge[has been reduced from previous highs of 2.0 percent to Expenses not chargeable to other categories,such approximately 1.8 percent of budgeted regular salaries as freight and miscellaneous items,and annual due to savings achieved in part through the use of regulatory fees assessed by the South Coast Air Quality online courses. Management District,are recorded with this category. Research and Monitoring - $0.8M Insurance - $2.SM Research and monitoring expenditures consist of The District's outside excess general liability insurance contract services to carry out the extensive ocean coverage is$40 million per occurrence with self- monitoring program required by the EPA under insurance retention of$500,000. provisions of the District's NPDES permit;air quality monitoring costs;the District's contribution to the The District's property insurance coverage is Southern California Coastal Water Research Project $1 billion for perils of fire and$300 million for perils of (SCCWRP)being conducted under a joint power 28 FISCAL YEARS 2010-17 AND 2017-18 BUDGET agreement with other Southern California municipal improve public education programs about the District's dischargers;and also provide for increased operational activities is also reflected in the budget for this line item. and ocean research and evaluation to develop optimum This group of accounts also includes costs for photo operating parameters in treatment plants. processing,advertisements,and notices. Printing and Publication - $0.3M Cost Allocation - ($19.2M) The budget provides for in-house and outside This represents direct labor and benefit charge outs and reproduction costs and reflects an expanded materials,supplies and services cost allocation to the management information system and administrative capital projects where the related work was performed. requirements,as well as a continuing demand by the public and regulatory agencies for information. The continuing effort of the Public Affairs Office to moo i ORANGE COUNTY SANITATION DISTRICT I EXECUTIVE SUMMARY FiSCAI YFAFS 911E 1 AND 2717 ' 29 DEPARTMENTS SUMMARY Expenses by Department (in millions) Projected Proposed Percent Proposed Percent Department 2015-16 2016-17 Change 2017-18 Change Administration Units: General Manager's Office $3.4 $4.5 32.4% S4.6 2.2% Human Resources 5.7 7.1 24.6% 7.5 5.6% Administrative Services 17.7 17.5 (1.1%) 18.5 5.7% Sub-Total $26.8 $29.1 8.6% $30.6 5.2% Operating Units: Facilities Support Services 18.7 0.0 (100.0%) 0.0 0.0% Environmental Services 0.0 17.1 100.0% 17.5 2.3% Engineering 7.8 2.4 (69.2%) 2.3 (4.2%) Operations&Maintenance 88.1 97.8 11.0% 99.5 1.7% Sub-Total $114.6 $117.3 2.4% $119.3 1.7% Total $141.4 $146.4 3.5% $149.9 2.4% Staffing by Department (FTEs) Projected Proposed Percent Proposed Percent Department 2015-16 2016-17 Change 2017-18 Change Administration Units: General Managers Office' 15.00 15.00 0.0% 15.00 0.0% Human Resources 27.00 27.00 0.0% 27.00 0.0% Administrative Services 98.00 99.00 1.0% 99.00 0.0% Sub-Total 140.00 141.00 0.7% 141.00 0.0% Operating Units: Facilities Support Services 63.00 0.00 (100.0%) 0.00 0.0% Environmental Services 0.00 91.00 100.0% 91.00 0.0% Engineering 127.00 116.00 (8.79/6) 116.00 0.0% Operations&Maintenance 294.00 279.00 (5.1%) 279.00 0.0% Sub-Total 484.00 486.00 0.4% 486.00 0.0% Total FTEs" 624.00 627.00 0.5% 627.00 0.0% 'FTE totals exclude Management Discretion positions thatare authorized but used only on a temporary basis to facilitate the replacement of key positions. A total of three Management Discretion positions are included in the proposed budget for FY2016-17,however, total filled positions will not exceed 627 FTEs at anypoint in time. 30 FISCAL YEARS 2010-17 AND 2017-18 BUDGET Administration Units Operating Units Office of the General Manager Environmental Services Budget $4.SM - Staffing 15 FTE Positions Budget $17.1 M - Staffing 91 FTE Positions The Office of the General Manager provides general The Environmental Services Department is a newly oversight of all District operations and incorporates created department that manages all environmental functions in the areas of Public Affairs and Board monitoring,regulatory,compliance and reporting Services.This office reports directly to the Board of elements to ensure that the District meets the Directors. requirements of federal,state and local regulations for treated sewage discharge into the ocean,water recycling, Human Resources air emissions,industrial waste,sewer system operations, Budget $7.1 M -Staffing 27 FTE Positions land use controls and biosolids and stormwater management. The Human Resources Department works with management and employees to ensure an effective Engineering and productive employment relationship.The Budget $2.41101 - Staffing 116 FTE Positions department also provides risk management services to the organization to create a safe,healthy and secure The Engineering Department is responsible for environment for staff,contractors,and visitors. the planning and execution of the District's capital improvement program and asset management program. Administrative Services The budget reflects the transfer out of 14 positions to Budget $17.5M - Staffing 99 FTE Positions other departments,partially offset by the addition of three new positions. The Administrative Services Department maintains financial oversight and administration of all District Operations and Maintenance funds and accounts and is responsible for contract Budget $97.81101 -Staffing 279 FTE Positions administration and procurement,and oversees all District computer,networking and customer support The Operations and Maintenance Department is issues.The budget reflects the transfer in of one position responsible for the operation and maintenance of the from another department District's two wastewater treatment plants as well as the sanitary sewer system pipeline and pumping facilities. The department also provides fleet management services for the District. The budget reflects the transfer out of 15 positions to other departments. 31 GENERAL MANAGER'S OFFICE M. Human Resources Board of Directors Administrative General General General Counsel Office Manager Environmental Services Engineering Opemticns& Maintenance Service Description General Management Administration is responsible for working with the Board of Directors to establish standards, policies and procedures,and the overall goals and Strategic Plan of the agency.The General Manager reports directly to the Board of Directors and provides general oversight to all District operations,interagency relations,legislative activities,communications,and the Strategic Plan.The Assistant General Manager directly oversees the Public Affairs and Board Services Divisions. Board Services provides a high level of customer service through the Clerk of the Board's office. The Clerk of the Board's office supports the Bond of Directors and the public by preparing and publishing agendas in accordance with legal requirements for meetings of the Board of Directors;recording the actions taken by the Board;publishing notices as required by law;acting as filing officer for Statement of Economic Interests filings;receiving and processing summons and complaints filed against the District;and maintaining rosters of the Board of Directors and appointed committee assignments. Public Affairs provides services and implements programs to meet the communications needs of OCSD's internal and external audiences.The division is responsible for OCSD's media relations,internal and external communications,community relations,public education and outreach program,social media,special events,agency branding,collateral materials,graphic design,and crisis communications.The division's goal is to develop and manage a total communications program in accordance to OCSD's Core Values and OCSD's Strategic Plan. 32 FISCAL YEARS 2010-17 AND 2017-18 BUDGET Operating Expense 2014-15 2015-16 2015-16 2016-17 2017-18 Category Actual Budget Projected Proposed Proposed Personnel $2,161,806 $2,462,470 $2,199,500 $2,286,100 $2,336,300 Supplies 243,943 327,540 267,730 355,590 362,690 Professional/Contractual Services 335,085 630,500 777,980 728,900 642,900 Research&Monitoring 0 0 0 0 0 Repairs&Maintenance 847 1,500 0 0 0 Utilities 110,824 136,000 116,000 122,000 137,000 Other 91,698 1,033,420 77,890 1,115,270 1,151,970 Cost Allocation (81,781) (92,500) (83,040) (57,240) (57,240) Total $2,862,422 $4,498,930 $3,356,060 $4,550,620 $4,573,620 Budget Overview Authorized FTE The fiscal year 2016-17 budget for the General Manager's Office reflects Positions an increase of 1.1 percent over the current budget.The increase is Managers.......................... .......... primarily due to increases in costs for legal services,software program Supervisors/Professionals...........8.00 consulting services,and temporary services in addition to the transfer Administrative/Clerical.................5.00 of funding for the National Water Research Institute membership from the Engineering Department.These increases were partially offset Total............................................15.00 b reductions in retirement costs,advocacy efforts,and training and 'Frerorais e"`r°°e roWwn c 0be moreererroc y e7' g p0smw,s wnron are fudholM ro Eeuseaonyon meeting expenses. a rampereynsar ro ramiram n�.apraaemanmr keyposilions. Performance Objectives / Measures Staffing Trends • Ensure that the Board approved Strategic Plan is implemented. • Provide leadership development opportunities reaching at least 70% i s oo u.o0 of staff. no 12.00 12.00 • Maintain the Special District Leadership Foundation(SLDF)District Transparency Certificate of Excellence. 2012-13 2013-14 2014-15 2015-16 2016-17 • Respond to 90%of public records requests within seven business days. FISCAL YEARS 2016-17 AND 2017-18 33 HUMAN RESOURCES DEPARTMENT General Manager's OffiHuman Risk Management I ce Resources Administration Board of Dnectors Administrative General Services Counsel General Office Manager Environmental Services Engineering Operations& Maintenance Service Description Human Resources is a full service department responsible for all aspects of Human Resources administration and management to ensure an effective and productive workplace and employment relationship. The Human Resources Department is committed to a workplace grounded in fair and equitable employment decisions and practices. This department serves as the in-house advisor to the General Manager,executive staff,OCSD departments,and all staff. Delivering services with a high-level of customer satisfaction is a key objective. Human Resources Administration oversees all human resources functions,including Benefits Administration, Classification and Compensation,Employee/Labor Relations,Employee Development/Performance Management, and Recruitment and Selection.Benefits Administration manages,maintains,and administers benefits for employees,including medical,dental,vision,and life insurance plans,Employee Assistance Program,retirement, voluntary benefits,and reasonable accommodations. Classification and Compensation is a vital function that establishes new classifications and salaries,while also reviewing existing classifications to determine appropriate placement within OCSD departments,including salary surveys and studies.Employee and Labor Relations offers professional assistance in various areas of the employee and labor relations field. Human Resources manages, interprets,and administers District policies and collective bargaining agreements while ensuring compliance with local,state,and federal regulations. Employee Development/Performance Management manages and coordinates District-wide legally mandated and development training programs;and manages employee performance through consulting management regarding performance appraisals and performance improvement plans.Through the Recruitment and Selection program,the District seeks to attract,hire,and retain the best qualified employees in a manner that is fair,equitable and merit-based. Risk Management/Safety/Security protects the finances and human resources of the District.It identifies and manages potential risk to the organization and provides solutions for mitigating or reducing the risk;and manages the District's Workers'Compensation Program and provides a secure,safe and healthy work environment for OCSD staff,contractors,and visitors. The division also provides training to identify and control risk,and cost-effectively address safety,health and security issues. 34 I 08ANGE COM FISCAL YEARS 2010-17 AND 2017-18 BUDGET Operating Expense 2014-15 2015-16 2015-16 2016-17 2017-18 Category Actual Budget Projected Proposed Proposed Personnel $3,345,017 $5,473,600 $4,301,780 $4,409,600 $4,484,300 Supplies 104,626 546,110 521,220 682,370 687,910 Professional/Contractual Services 718,293 1,655,800 1,438,390 1,622,000 1,642,400 Research&Monitoring 0 0 0 0 0 Repairs&Maintenance 0 3,550 3,050 28,050 28,050 Utilities 0 0 0 0 0 Other 27,490 629,580 608,300 1,255,920 1,576,120 Cost Allocation (681,160) (1,118,100) (1,119,920) (931,720) (931,720) Total $3,514,266 $7,190,540 $5,752,620 $7,066,220 $7,487,060 Budget Overview Authorized FTE The fiscal year 2016-17 budget for the Human Resources Department Positions reflects a 1.7 percent decrease from the current budget.The decrease Managers......................................2.00 is primarily due to a reduction in budgeted retirement costs.The Supervisors/Professionals.........22.00 decrease is partially offset by an increase in the general liability Administrative/Clerical.................3.00 insurance in-lieu premium expense and adjustments to the district- wide cost allocation plan. Total............................................27.00 Performance Objectives / Measures Staffing Trends 27.00 27,00 • Continue with development and implementation ofeffective workforce planning/development and succession planning strategies. 1800 16.00 • Update and implement recruitment plan to reduce vacancies by 1600 June 30,2017. • Review all training requirements and meet the training]eve]of 13012-13 2013-14 201415 2015-16 2016-17 service of 45 hours per employee. • Complete labor negotiations with all bargaining units by December 31,2016. • Ensure 100%of Safety Compliance Training is completed. • Implement Leading Safety Indicators to reduce injuries to employees. • Manage operating expenditures to within 96 to 100 percent of the approved budget. ISCAL YEARS 2016-17AND 2017-18 35 ADMINISTRATIVE SERVICES DEPARTMENT General Managers Office Human Resources Board of Directors General General Counsel Manager Office Environmental Services Engineering Operations& Maintenance Service Description The Administrative Services Department oversees all of OCSD's finance,contracts/purchasing,and information technology activities,including both day-to-day operations and strategic planning.The department serves as a liaison to Executive Management,the Board of Directors,and other departments of OCSD.'Ihe department includes four divisions: Administrative Services provides leadership and oversight to all Administrative Services divisions. Financial Management oversees and administers all OCSD's fonds and accounts.Programs include treasury and debt management,accounts receivable and payable,user fees,payroll,fixed assets accounting,and coordinating the capital and operating budget process. Contracts,Purchasing,&Materials Management is responsible for contract administration and procurement for all departments.Additionally,this division manages OCSD's warehouses,receives and maintains inventory,and distributes supplies,materials,and equipment. Information Technology is responsible for customer support related information technology assets and services, networking and infrastructure,telecommunications service operation and maintenance,network and programming, solutions and application support. 30 FISCAL YEARS 2010-17 AND 2017-18 BUDGET Operating Expense 2014-15 2015-16 2015-16 2016-17 2017-18 Category Actual Budget Projected Proposed Proposed Personnel $16,071,788 $14,188,900 $13,824,000 $13,363,400 $13,563,000 Supplies 1,431,769 1,354,360 1,141,120 1,233,960 1,581,870 Professional Contractual Services 2,032,272 1,468,570 1,276,910 1,289,400 1,578,900 Research&Monitoring 0 0 0 0 0 Repairs&Maintenance 1,342,205 1,354,140 2,006,260 2,042,000 2,142,000 Utilities 315,172 385,000 350,000 400,000 400,000 Other 654,831 64,820 80,280 109,610 121,610 Cost Allocation (1,441,269) (1,117,710) (1,001,310) (942,320) (942,320) Total $20,406,768 $17,698,080 $17,677,260 $17,496,050 $18,445,060 Budget Overview Authorized FTE The fiscal year 2016-17 budget for the Administrative Services Positions Department reflects a 1.1 percent decrease from the current budget. Managers......................................5.00 The decrease is primarily due to a reduction in budgeted retirement Supervisors/Professionals.........56.00 costs,in-house reproduction services,and other professional services. Administrative/Clerical...............36.00 The decrease is partially offset by increased costs for repairs and maintenance,service maintenance agreements,and adjustments to the Other......... ............................2.00 district-wide cost allocation plan. Total............................................99.00 Performance Objectives / Measures Staffing Trends • Manage operating expenditures to within 96 to 100 percent of the approved budget. • Comply with the California State Government Code 100 percent of 110.75 110.00 111.00 the time with all treasury investments. • Submit the annual sewer service fee property parcel database to the 98.00 99.00 County in time for placement on annual secured property tax bills. • Process all approved sewer service fee refund requests within 45 days, 2012-13 2013-14 201415 2015-I6 2016-17 90 percent of the time. • All debt service payments will be paid electronically,on the actual due dates,and error free too percent of the time. • Continue the warehouse inventory cycle count program and maintain a 97 percent accuracy rate or better. • Ensure the measurement of the Information Technology Strategic Plan target achievement based on the importance and completion of goals supporting the Levels of Service(LOS)in the OCSD Strategic Plan. • Maintain an average uptime of 90 percent for critical applications. EARS 2016-17 AND 2017-18 37 ENVIRONMENTAL SERVICES DEPARTMENT General Managers Office Human Resou es Board of Directors 17— Administrative Environmental General ServicesServices Counsel GeneralAdministration Office ManagEnvironmental er Compliance Laboratory& Ocean Monitoring Engineering Operations& Maintenance Service Description The Environmental Services Department,a newly created department,manages all of OCSD's environmental monitoring,regulatory,compliance and reporting elements to ensure that the District meets the requirements of federal,state and local regulations for treated sewage discharge into the ocean,water recycling,air emissions, industrial waste,sewer system operations,land use controls and biosolids and stormwater management The Environmental Services Services Department consists of three divisions: Environmental Services Administration provides leadership,support,and management oversight for the Department in order to accomplish OCSD's Strategic Plan and departmental annual goals. Environmental Compliance fulfills regulatory requirements with proper biosolids management,air quality controls, federal pretreatment regulations,stormwater guidelines,non-industrial source control,and water reclamation and reuse.This is done in the most cost effective,practical,and beneficial manner that meets regulatory requirements, protects the Sanitation District's assets,employees,and ocean discharge. Laboratory and Ocean Monitoring performs sampling,monitoring,analysis,evaluation and recommendations for collection system,treatment processes,air samples,coastal water quality,marine sediments and the fish populations within the influence of OCSD's wastewater discharge and comparison sites to evaluate and address related issues of concern to the District in order to protect and preserve the environment and public health. 38 FISCAL YEARS 2010-17 AND 2017-18 BUDGET Operating Expense 2014-15 2015-16 2015-16 2016-17 2017-1B Category Actual Budget Projected Proposed Proposed Personnel $0 $0 $0 $13,239,100 $13,387,300 Supplies 0 0 0 768,150 781,530 Professional/Contractual Services 0 0 0 881,000 966,800 Research&Monitoring 0 0 0 800,000 872,400 Repairs&Maintenance 0 0 0 255,000 270,000 Utilities 0 0 0 448,000 504,000 Other 0 0 0 778,370 793,240 Cost Allocation 0 0 0 (34,950) (34,950) Total $0 $0 $0 $17,134,670 $17,540,320 Budget Overview Authorized FTE The fiscal year 2016-17 budget for the newly created Environmental Positions Services Department is$17.1 million.The major cost items include Managers...... ....................3.00 salaries and benefits for 91 full-time equivalent(FTE)positions Supervisors/Professionals........63.00 reallocated from other departments,as well as costs for research and Administrative/Clerical.................9.00 monitoring,regulatory operating fees,laboratory chemical and supplies, Technical.....................................16.00 electricity,and legal services. Total............................................91.00 Performance Objectives / Measures Staffing Trends • Manage operating expenditures to within 96 to 100 percent of the 91.00 approved budget. • Ensure that reporting divisions achieve 90%of individual performance objectives. • Ensure that all environmental compliance reporting requirements are met on or before required submission dates. are, 0.00 0.00 0. 2012 13 2013-14 201415 2015-16 2016-1/ • Conduct audits of all major environmental permits at least once every three years. • Complete 100%of Safety Scorecard requirements each quarter. """'"' ""••••_.,"...._._.".."."_"."_ . _.,__.._..._ _......._.. FISCAL YEARS 2016-17 AND 2017-18 39 ENGINEERING DEPARTMENT General Manager's Office Human Resources Board of Directors Administrative General Services Counsel General Office Manager EnNronmental Planning Project Management Office Civil& Mechanical Services Operations& Engineering Maintenance Electrical& Service Description The Engineering Department is responsible for the planning and execution of OCSD's Capital Improvement Program and the Asset Management Program.The Engineering Department is comprised of five divisions: Engineering Administration provides management to all Engineering Divisions. Planning is responsible for estimating future capacity requirements,planning existing asset lifecycles,performing applied research,developing the OCSD Capital Improvement Program and complying with the California Environmental Quality Act.In addition,this division is responsible for OCSD's Asset Management program to ensure that required levels of service me maintained by performing necessary rehabilitation and replacement of facilities at optimal lifecycle costs.The Planning division also performs services for annexations,connection permitting,and inter-agency agreements. Project Management Office is responsible for the delivery of capital projects from the preliminary design stage through the closeout of construction. Civil&Mechanical Engineering provides design and construction engineering,quality control inspection,and other technical support for design and construction projects. Electrical&Control Systems Engineering provides electrical and control system designs,ensures that projects are properly and safely constructed,and provides process control SCADA system hardware,software and data network support for collections and treatment plant processes that monitor,record,control,and operate our facilities. 40 FISCAL YEARS 2010-17 AND 2017-18 BUDGET Operating Expense 2014-15 2015-16 2015-16 2016-17 2017-18 Category Actual Budget Projected Proposed Proposed Personnel $21,037,728 $21,045,730 $20,229,400 $18,341,000 $18,594,200 Supplies 424,129 514,370 392,300 516,090 471,430 Professional/Contractual Services 1,383,448 551,000 765,600 500,000 430,000 Research&Monitoring 94,932 85,000 85,000 0 0 Repairs&Maintenance 1,096 0 2,040 21000 2,000 Utilities 0 0 0 0 0 Other 700,384 702,660 699,700 4,360 4,410 Cost Allocation (13,426,197) (13,355,500) (14,327,550) (17,010,000) (17,220,420) Total $10,215,520 $9,543,260 $7,846,490 $2,353,450 $2,281,620 Budget Overview The fiscal year 2016-17 budget for the Engineering Department reflects a Authorized FTE 75.3 percent decrease from the current budget.The decrease is primarily due Positions to the reallocation of 11 FTE positions to other deparhnents,a reduction in Managers—.._...............................5.00 budgeted retirement costs,the transfer of regulatory operating costs to the Supervisors/Professionals........82.00 new Environmental Services Department and adjustments to the district- Administrative/Clerical..............29.00 wide cost allocation plan. Total..........................................116.00 Performance Objectives / Measures staffing Trends • Expend minimum 90 percent of project annual Capital Improvement 125.00 123.00 123,00 127 00 Program cash flows for fiscal year 2016-17. 0 • Manage operating expenditures to within 96 to 100 percent of the approved budget. 201213 2013-14 2014-15 2015-16 201617 • Ensure that reporting divisions achieve 90 percent of individual performance objectives. • Complete the Odor Control Master Plan in fiscal year 2016-17. FISCAL YEARS 2016-17 AND 2017-18 41 OPERATIONS & MAINTENANCE DEPARTMENT General Managers Office Human Resources Board of Directors AAministrative General Services Counsel General Office Manager Environmental oPlantNo. $eNlCee Perot.ions Plant No.2 Maintenance Engineering r� Service Description The Operations and Maintenance(O&M)Department is responsible for treating wastewater,reusing or disposing of the treated wastewater and all residuals,providing maintenance support to all treatment facilities,operating and maintaining the sanitary sewer system pipeline and pumping facilities,and for providing fleet management services. The Department consists of seven divisions: Operations and Maintenance Administration provides leadership and oversight to all O&M divisions. Collection Facilities Operations&Maintenance operates and maintains the regional facilities which include gravity sewers and pumping facilities. Fleet Services provides fleet and heavy equipment services and motor pool management to all OCSD staff. Plant No. 1 and Plant No.2 Operations are responsible for the daily management of the wastewater treatment processes,sludge and biosolids treatment and loading processes,power generation,and odor and air quality control processes.Activities also include ensuring compliance with all regulatory permits,support of the Capital Improvement Program,and coordination of construction and maintenance work Plant No. 1 Operations also ensures the delivery of specification water to the Ground Water Replenishment System. Plant No. 1 and Plant No.2 Maintenance are responsible for civil,electrical,facilities,instrumentation and mechanical maintenance of the two treatment plants and pump stations. Also centralized under the Maintenance Manager in support of both plants and collection system is the Maintenance Management Group and the Reliability Maintenance Team,which provide district-wide support services for planning and scheduling maintenance events and predictive maintenance activities 42 FISCAL YEARS 2010-17 AND 2017-18 BUDGET Operating Expense 2014-15 2015-16 2015-16 2016-17 2017-18 Category Actual Budget Projected Proposed Proposed Personnel $41,873,009 $42,634,100 $40,683,200 $37,650,600 $38,252,300 Supplies 9,118,904 9,978,000 10,160,520 16,337,150 16,900,820 Professional/Contractual Services 19,490,254 21,232,380 20,405,360 23,970,950 21,549,530 Research&Monitoring 715,922 745,000 635,000 0 0 Repairs&Maintenance 8,564,533 9,938,040 10,241,850 11,938.880 13,718,110 Utilities 6,054,294 6,501,160 7,384,380 7,942,240 9,192,670 Other 70,528 196,730 81,370 121,490 121,190 Cost Allocation (1,216,587) (914,520) (1,505,680) (205,800) (207,910) Total $84,670,857 $90,310,890 $88,086,000 $97,755,510 $99,526,710 Budget Overview Authorized FTE The fiscal yar 2016-17 budget for the Operations and Maintenance Positions Department reflects an increase of 8.2 percent over the current budget. Managers...... .............4.00 The increase is primarily due to increases in costs for odor control,other Supervisors/Professionals..........58.00 contractual services,repairs and maintenance,and electricity.These Administrative/Clerical..................6.00 increases were partially offset by reductions in costs for retirement, Technical.......................................1.00 solids removal,research and monitoring,laboratory chemicals and Operations&Maintenance.......210.00 supplies,and the reallocation of 15 FTE positions to other departments. These budget changes reflect the District's reorganization that added Total..........................................279.00 Fleet Services and Collection System Operations and Maintenance functions to the Operations and Maintenance Department and Staffing Trends transferred Laboratory and Ocean Monitoring functions to the new Environmental Services Department. 28183 00 28400 29400 27900 Performance Objectives / Measures _ - .00 2 • Achieve 100 percent compliance with water,solids,air,and energy permits. 2012-13 201314 2014-15 2015-16 za1F17 • Achieve a compliance level of 90 to 100 percent of the O&M performance measurement targets. • Manage operating expenditures to within 96 to 100 percent of the approved budget. FISCAL YEARS 2016-17 AND 2017-18 43 yea I��ili iaWl CIII\ 2 IJ i�I � li� I II\\' III V��M1M I y j 1 � APPENDIX A 1 feel, r . year strategic plan DECEMBER 2015 ORANGE COUNTY SANITATION DISTRICT ORANGE COUNTY SANITATION DISTRICT 5 year strategic plan DECEMBER 2015 _11 AI A W � � o � a P o ' ti�"pr/M C_JE ENJ\P t GI�� �V,-+■ � yet n l - .' , "` '. . u � nil ,► I III ;. � � -�;;, � I _ - ` ilk - table of contents ■ OCSD Board of Directors.........................................................................................ii Message from the General Manager........................................................................iu Executive Summary.....................................................................................................1 The Strategic Planning Fmme otk..........................................................................2 MissionStatement.......................................................................................................3 VisionStatement..........................................................................................................4 CoreValues...................................................................................................................5 RiskRegister.................................................................................................................6 Strategic Goals and Levels of Service......................................................................7 Appendix A: Issue Papers........................................................................................10 Appendix B: Summary of Accomplishments.......................................................13 AppendixC: Glossary...............................................................................................17 ORANGE COUNTY SANITATION DISTRICT-5 YEAR STRATEGIC PLAN(DECEMBER 2015) board of directors The strategic planning effort starts with the Board of Directors setting overall policy and priorities for the Sanitation District. Based on that policy direction,staff develops the annual operational plan and budget. Anaheim Los Alamitos Lucille Kong Richard Murphy Brea Member of the Board of Glenn Parker Supervisors Lisa Bartlett Buena Park Fred Smith Midway City Sanitary District Joy Neugebauer Costa Mesa Sanitary District James M. Ferryman Newport Beach Keith Curry Cypress Mariellen Yarc Orange Teresa Smith Fountain Valley Steve Nagel Placentia Chad Wanke Fullerton Greg Seboum Santa Ana (Board Vice Chair) Sal Tinajero Garden Grove Seal Beach Steve Jones Ellery Deaton Huntington Beach Stanton Jim Katapodis David Shawver Irvine Tustin Steven Choi John Nielsen (Board Chair) Irvine Ranch Water District John Withers Villa Park Greg Mills La Habra Tom Beamish Yorba Linda Water District Robert Kiley La Palma Peter Kim ■ ORANGE COUNTY SANITATION DISTRICT-5 YEAR STRATEGIC PLAN (DECEMBER 2015) message from the general manager In November 2013 the Orange County Sanitation District (OCSD) adopted a 5 Year Strategic Plan that envisioned an organizational culture that adheres to our core values and makes efficient and effective use of all available resources.The Strategic Plan centered our efforts on customer service, fiscal responsibility, protecting public health and the environment,communication, partnering with others and creating the best possible workforce. We committed to the execution of that plan and implementation of the eight strategic goals necessary to achieve success. Protecting public health and the environment is critical to our mission,and I am pleased to report that our ocean monitoring program reflects that the ocean is healthy around OCSD's ocean outfall.We also continue to be fiscally strong.This year OCSD received AAA bond ratings and we have reduced our long term pension liabilities,which in turn enabled us to reduce planned rate increases by 35 percent over the next three years. Two years into the five year Strategic Plan, I am pleased to report that we have completed two of the strategic goals and made strides towards accomplishing the remaining six.We held a Strategic Plan Update workshop,prepared two issue papers and updated our Summary of Accomplishments and the Risk Register.We remain committed to sustaining and improving our performance and meeting all of the established strategic goals. Under the direction of the Board of Directors,I am honored to be leading this effort and I look forward to working together to accomplish our goals in the years ahead and continuing our successes. The accomplishments laid out in this Strategic Plan Update would not be possible without the collective dedication and effort of our workforce and the commitment and support of our Board of Directors and the public we serve. Respectfully submitted, /�Mw " James D. Herberg General Manager ORANGE COUNTY SANITATION DISTRICT-5 YEAR STRATEGIC PLAN(DECEMBER 2015) executive summary The 2014—2019 5 year Strategic Plan is a guiding document that provides a framework that directs our work Every two years,the Strategic Plan will be reassessed,updated,and submitted for approval by the Board of Directors. This year's Strategic Plan Update began with a consultant retained by OCSD conducting confidential interviews with interested Board members to identify issues or concerns.The Strategic Plan Update continued with a workshop and presentation of two issue papers.The Update concluded with two Strategic Goals being identified as completed,no new goals being adopted and no modifications being made to OCSD's levels of service. Completed Strategic Goals: Disinfection of Ocean Discharge—Develop an implementation plan including the technical, financial and societal factors associated with cessation of disinfection of the ocean discharge. Legislative Advocacy and Public Outreach—Develop a unified legislative advocacy and public outreach program. Strategic Goals In Progress: 1.Odor Control—Completion of the Odor Control Master Plan. 2.Future Biosolids Management Options—Study biosohds management options including third party contracts and onsite capital facilities. 3.Energy Efficiency—Continue to research new energy efficiency and energy conversion technologies. 4.Local Sewer Transfers—Complete the transfer of 174 miles of local sewers serving pans of Tustin and unincorporated areas north of Tustin and local sewer transfers in the City of Santa Ana. 5.Future Water Recycling—Determine partnerships,needs, strategies,benefits and costs associated with recycling of Plant No. 2 effluent water. 6.Workforce Planning and Workforce Development—This initiative is ongoing and part of a comprehensive workforce planning and development effort to ensure we have the right people with the right skills and abilities,in the tight place,at the right time. ORANGE COUNTY SANITATION DISTRICT-5 YEAR STRATEGIC PLAN (DECEMBER 2015) strategic planning framework The planning framework illustrated below shows how OCSD staff and the Board of Directors play a critical role in strategic planning and resource allocation. Monitoring Strategic New or altered and Evaluation PlanningLevels of Service Strategic Boara Board Planning Approval of Approval of Process Strategic Plan Budget Budget"* Operational *\Goals and Planning Objectives ■ ■ - z - � sfrl� � J , • �ac� ORANGE COUNTY SANITATION DISTRICT-5 YEAR STRATEGIC PLAN(DECEMBER 2015) our mission statement The Mission Statement is the basic foundation that defines why we exist. 1 protect public 1the environment 1 providing wastewater collection, 1 i ORANGE COUNTY SANITATION DISTRICT-5 YEAR STRATEGIC PLAN (DECEMBER 2015) vision statement The Vision Statement supports the Mission Statement by expressing a broad philosophy of what the Orange County Sanitation District strives to achieve in the delivery of services to our customers,vendors, other agencies,the general public,and each other. ORANGE COUNTY SANITATION DISTRICT WILL BE A LEADER IN: Providing reliable, responsive and affordable services in line with customer needs and expectations. Protecting public health and the environment utilizing all practical and effective means for wastewater, energy, and solids resource recovery. Continually seeking efficiencies to ensure that the public's money is wisely spent. Communicating our mission and strategies with those we serve and all other stakeholders. Partnering with others to benefit our customers, this region, and our industry. Creating the best possible workforce in terms of safety, productivity, customer service, and training. ORANGE COUNTY SANITATION DISTRICT-5 YEAR STRATEGIC PLAN(DECEMBER 2015) core values The Core Values ort the Nfission and Vision Statements by expressing the and philosophy that guides . actions. . . o . organization . our professional work ethic. Honesty, Trust and Respect We aspire to the highest degree of integrity,honesty,trust, and respect in out interaction with each other,our suppliers, our customers,and our community. Teamwork and Problem Solving We strive to reach OCSD goals rhxough cooperative effotts and collaboration with each other and our constituencies. We work to solve problems in a creative,cost-effective and safe manner,and we acknowledge ream and individual efforts. Leadership and Commitment We lead by example,acknowledging the value of our resources and using them wisely and safely to aclileve our objectives and goals.We are committed to act in the best interest of our employees,out orgatilzation, and our community. Learning/Teaching We continuously develop ourselves, enhancing our talents, skills, and abilities,knowing that only through personal growth and development will we continue to peogxess as an agency and as individuals. Recognition/Rewards We seek to recognize,acknowledge,and xewazd contributions to OCSD by our many talented employees. ORANGE risk register 2015 The Risk Register is a periodic compilation of the various risks facing the Orange County Sanitation District, as seen and determined by our management team. The 2015 Risk Register Update identified these as the top risks: • Pipelines damaged or severed after earthquake—focusing on the concern of liquefaction from an earthquake,that may cause movement of pipes or other system failures. • Attracting qualified applicants and enticing top candidates to join OCSD—reflecting the concern that as we lose talent due to retirements and staff movement,our lack of a comprehensive strategy to attract top talent and the existing pay and benefits program which is not competitive with other agencies may limit us from attracting tenured public sector employees. The top opportunities for the 2015 update are: • As employees leave,restructure staffing to become more efficient—referring to the many employees who are eligible for retirement, and the opportunity to look at staffing needs thereafter. • Focus on main mission without other endeavors leading to higher rates—an opportunity to stick to our core business so that costs are kept in line. The major underrated continuity challenges Include: • Cyber-terrorist or hacker attacks on OCSD—related to the ever-changing risks and increased need to secure our computer network servers. • Emergency Preparedness—expressing concern that OCSD is unprepared to deal with disasters such as electrical outages and explosions. Staff is developing plans to mitigate the risks and continuity challenges,and to take advantage of the opportunities. OCSD's Risk Management division released a schedule of"table top exercises"designed to respond to the top risks and challenges,and held an exercise focused on the possible interruption of electrical power after a disaster.An exercise is also planned to consider how to respond to the potential damage to Pipelines from an earthquake.As for opportunities,OCSD's General Manager has directed,as part of this Strategic Plan,that comprehensive workforce planning activities be designed and implemented. ORANGE COUNTY SANITATION DISTRICT-5 YEAR STRATEGIC PLAN(DECEMBER 2015) strategic goals and levels of service OCSD has six outstanding strategic goals to support the vision of the Board of Directors and Executive Management Team.The levels of service are key performance indicators in achieving the overall vision. Providing Exceptional Customer Service • Providing reliable,responsive and affordable services in line with customer needs and expectations. 1. Odor Control- Completion of the Odor Control Master Plan to make sure the District's investment is current and,if needed, future process systems to produce the benefits intended. Target eo SnIetidn in FY 15-16. Providing I Customer 14-15 Level of Service Target Odor complaint response Treatment plants within 1 hour 100% 100 Odor complaint response:Collection system within 1 working day 98% 100% Number of odor complaints: • Reclamation Plant No. 1 8 0 •Treatment Plant No. 2 9 0 • Collection System 27 12 *Under normal operating conditions Respond to public complaints or inquiries regarding construction 100% 100% projects within 1 working day New connection permits processed within 1 working day 100% 100% Respond to all biosolids contractor violations within a week of 100% 100% violation notice Protecting Public Health and the Environment • Protecting public health and the environment utilizing all practical and effective means for wastewater, energy, and solids resource recovery. 2. Future Biosolids Management Options—Study biosolids management options including third parry contracts and onsite capital facilities for mid-term and long-term approaches beginning in 2016-2017. Target for completion in FY 15-16. 3. Energy Efficiency—The District will research new energy efficiency and energy conversion technologies to maximize energy efficiency,reduce operating costs,minimize environmental impact, and replace assets that are at the end of their useful lives. Target for completion in FY 17-18. 4 � i OCSD owns and operates$6.2 billion in inhastructure assets.Through these assets,OCSD collects,treats,and either reuses or safely discharges 185 million gallons per day of wastewater. ORANGE COO NTY SANITATION DISTRICT—5 YEAR STRATEGIC PLAN (DEC E M BER 2015) strategic goals and levels of service Protecting Public Health &The Environment Level of Results Service Target Accept dry weather runoff diversion flows without imposing fees 1.2 mgd Up to 10 mgd Air emissions health risk to community and employees,per one 9 QO million people for each Treatmentplant) Notices of violation (NOV) with air,land, and water permits 0 0 Respond to collections stems ills within 1 hour 100% 100% Sanitary sewer spills per 100 miles 1.2 < 2.1 Contain sanitary sewers ills within 5 hours 100% 100% Meet secondary treatment standards BOD 4.8 mg/L BOD 25 mg/L TSS 5.7 mg/L TSS 30 mg/L Thirty-day geometric mean of coliform bacteria in effluent after 881 <I000 initial dilution of 250:1 (MPN) Frequency of unplanned use of emergency one-mile(78-inch 0 0 diameter) outfall (per year during dry weather) Tons of biosolids to landfill through 2017 peak production period 60 100 Compliance with core industrial pretreatment requirements 100% 100% Managing and Protecting the Public's Funds Continually seeking efficiencies to ensure that the public's money is wisely spent. 4. Local Sewer Transfers—Complete Transfer of 174 miles of local sewers serving parts of Tustin and unincorporated areas north of Tustin and local sewer transfers in the City of Santa Ana to be concluded by December 31,2016. Following those,no further local sewers to be Transferred at the initiation of OCSD.If a local jurisdiction is interested in OCSD transferring sewers,each request will be considered on an individual basis assuming the sewers meet the requirements identified. Tagetfor completion in I'Y 16-17. Managing and Protecting the Public Funds F1'14-15 Level of Service Results Target Annual user fees sufficient to cover all O&M requirements 100% 100% Actual collection, treatment,and disposal costs per million gallons 3%under 5 10% of budget Maintain AAA Bond Rating 100% 100% ORANGE COUNTY SANITATION DISTRICT-5 YEAR STRATEGIC PLAN(DECEMBER 2015) strategic goals and levels of service Stakeholder Understanding and Support • Communicating our mission and strategies with those we serve and all other stakeholders. • Partnering with others to benefit our customers,this region and our industry. 5. Future Water Recycling Options—Determine partnerships,needs,strategies,benefits and costs associated with recycling of Plant No. 2 effluent water. Tagetforcomple&on in FY 18-19. Stakeholder Understanding and Support F1'IA-15 Lev 1 of Service Results Target Meet GWRS specification rcyuixcments for Plant No. 1 secondary 2.7 NTU 5 NTU effluent Provide specification effluent available to the Groundwater 100% 100% Replenishment System to maximize production of purified water Organizational Effectives • Creating the best possible workforce in terms of safety,productivity,customer service,and training. 6. Workforce Planning and Workforce Development—This initiative is ongoing and part of a comprehensive workforce planning and development effort to ensure we have the right people with the eight skills and abilities,in the eight place, at the right time.Target for completion is ongoing. Organizational Effectiveness iY 14-15 vel of Service Results Target Employee injury incidentrate—per 100 employees 17 <3.31ndustry Average Meet mandatory OSHA training re uiretnents 100% >95% Hours worked since last lost work day 430,000 >1,000,000 Achieve annual agency target of days away from work,days of restricted work activity,or job transferred as a result of a work- 0.8 <2.5 related injury or illness Avcxag*c cost per Workers Compensation claim $6,774 $13,545 Trainin hoursper employee 45.23 45 per year ORANGE COUNTY SANITATION DISTRICT-5 YEAR STRATEGIC PLAN (DECEMBER 2015) appendix A: issue papers In preparation for the October 21,2015 Board of Directors Strategic Planning Workshop staff prepared two issue papers related to the new goals.The appendix includes issue papers on the following topics: 1. Odor Control Level Of Service 2.Storrnwater Capture i r - ORANGE COUNTY SANITATION DISTRICT-5 YEAR STRATEGIC PLAN(DECEMBER 2016) odor control Should OCSD change the level nfAmmllap for odor control? Why is this issue important to the District? In 1989, OCSD began addressing collection system odor and corrosion concerns chemically by implementing a caustic soda shock-dosing program for some of the tmnklines.In 2001,this program evolved to continuous chemical dosing in the collection system for odor control which utilized ferrous chloride,magnesium hydroxide,and calcium nitrate at nine different dosing locations.The program has proven to reduce odor and corrosion in the regional trunk system and suppress odors at the headworks of the treatment plants.It also helps condition the sewage arriving at the treatment plants. In 2007, the Board of Directors adopted the Five-Year Strategic Plan,which set the Level of Service standard at a goal of 34 or less odor complaints attributed to the OCSD collection system.At that time two categories were tracked;Attributed,and Not Attributed.The attributed category captured complaints attributed to OCSD as well as those whose source could not be determined.The complaints were classified by the OCSD responder. In 2009, a third category was created by staff to appropriately document odors of an undetermined source.With the addition of this category,odor complaints attributed to OCSD were reduced significantly.As a result,the goal was reduced in 2014 to 12 complaints or less attributed to OCSD. In 2014,the Odor Control Division revised its Odor Response Procedure to include a follow up investigation as a secondary response for each odor complaint.The objective was to minimize the unknown sources and ultimately better address the root causes of the odors.The complaints were classified by the secondary OCSD responder after the investigation was concluded. Our LOS goal for FY 14/15 was 12 or fewer. Due to the results of the detailed investigations,the number of OCSD attributed complaints has increased.We had 27 validated odor complaints in the collection facilities in FY 14/15 due to various causes. It is recommended that the Level of Service goals be changed to better reflect the current methodology used to investigate. Recommendation Increase our current level of service from 12 odor complaints to 28. A new goal of 28 or less odor complaints attributed to OCSD would reflect the success of the change in procedures in determining the true source or root cause of the odor complaints.This new LOS could also be achieved within the current budget/sewer fee structure. Staff does not foresee a reduction to the current number of complaints until the plant odor facilities modifications are completed.Any further reductions would also require modifications to Collections' Odor Control Program. Modifications could include items such as additional dosing facilities, additional siphon vents,and repairs to existing siphon vents within the collection system.The Collection Facilities Odor Control Master Plan Update expected in 2017 will help guide the future direction. The new goal of 28 or less odor complaints attributed to OCSD is an appropriate reflection of Current Odor Control Program procedures.By continuing to better investigate the root causes of the odors,we can improve strategies for mitigation.The desired outcome may be to eventually reduce the number of attributable odor complaints to zero for those facilities that are a part of the continuous dosing or"sewage conditioning"program ORANGE COUNTY SANITATION DISTRICT-5 YEAR STRATEGIC PLAN (DECEMBER 2015) stormwater Should we capture stormwater? Why is this issue important to the District? The Board of Directors has expressed interest in stormwater capture to augment water supplies and aquifer recharge for North Central Orange County. Background: OCSD has been active in stormwater capture for more than a decade with its urban runoff diversion program.This program is approved to accept up to ten million gallons per day of urban runoff, which is technically stormwater. Expressed differently,this ten million gallon per day of flow is equivalent to 18 cubic feet per second.The program was originally begun to improve beach water quality by diverting river water laden with bacteria from reaching recreational beaches. OCSD has limited the flow to dry weather to protect its collection system and Treatment plants from having overflows which are spills. OCSD's service area contains several dams to control wet weather sto¢nwater flows.These include Prado Dam, Carbon Canyon Dam,Brea Dam,Fullerton Dam,Villa Park Dam,and Santiago Dam.These Dams are connected to rivers and channels which are designed to flow large volumes of silt laden water in order to protect regions from the damage associated with flooding events. Prado Dam is capable of releasing more than 30,000 cubic feet of water per second,or more than 19 billion gallons per day. The Orange County Water District is primarily responsible for recharging the aquifer in North Central Orange County.It controls more than 1,000 acres of river,ponds and percolation basins in Anaheim and 1,250 acres of surface water storage behind Prado Dam.The dam is controlled by the Army Corps of Engineers to protect from flooding and secondarily to store stormwater to recharge of Orange Counties' aquifer.The water is released at a rate that allows for diversion to the Anaheim recharge ponds and lakes usually less than 100 cubic feet per second. OCSD's systems are not designed to handle wet weather stormwater volumes or content.Wet weather naturally increases flow through OCSD's system caused by inflow and infiltration.Inflow is direct flow into the system generally attributed to illegal connections,leaks through manholes and other openings to standing or flowing surface water.Infiltration is ground water that seeps into the sewer system through pipe and manhole defects.These flows can increase normal dry weather flows by 2.2 tunes. Recommendation Orange County Sanitation District must balance its mission to protect public health and to create usable products like potable water.Treatment Plant and collection system capacities are designed around normal system flow patterns.These sewers and plants are completely incapable of dealing with even minor rain event stormwater flows. Sewer pipes are a fraction of the size of storm drains,much less flood channels. Storms flows are not necessary for feeding the GWRS. Normal sewage flows, even in a historic drought,are feeding the system at near capacity.The greater risk to OCSD's mission is the risk to public health that occurs with sewer overflows. Raw sewage in the streets or waterways is a completely unacceptable outcome. Stormwater capture is the purview of Orange County Water District,CC Flood, and the Army Corps of Engineers.They have the necessary infrastructure and available land. OCSD should continue to accept dry weather urban runoff to support water reuse and protect beach water quality. ORANGE COUNTY SANITATION DISTRICT-5 YEAR STRATEGIC PLAN(DECEMBER 2015) appendix B summary of accomplishments Goal Completed FY 07-08 FY 08-09 FY 09-10 FY 1011 FY 1112 FY 12-13 FY 1314 FY 15-16 SARI Line Relocation-Work in conjunction with the County of Omnge and • the Federal Government to relocate the SARI Line by December 31,2013. Management System for Environmental Compliance-Implement a management control system for environmental • compliance information that incorporates a dashboard-style report. Contaminants of Potential Concern (CPC)-Complete three phase testing and analysis of 550+CPC, prepare report on • findings and recommendations,develop initial source control strategy if they are CPCs identified that require control. Climate Change/Greenhouse Gases Develop an overall strategy for respondingto climate change regulations and proactively adapting to the effects of climate change All including identification and mitigation of greenhouse gases and adapting to any impacts to our facilities and operations. Develop models to estimate greenhouse gas and traditional pollutant emissions for determination of our environmental • footprint.(Functional predictive greenhouse gas model completed) Engine Emission Compliance Complete study to evaluate alternatives for complying with lower emission limits in the South Coast Air Quality Management's Rule 1110.2.Initiate • planning and design of demonstration testing of most promising technology(s) identified in the study. Implement capital improvements or operational modifications in order to • achieve compliance. Providing Ongoing Leadership Development-Maximize the development of a pool of dedicated and talented • employees ready to lead OCSD into the future. ORANGE COUNTY SANITATION DISTRICT-5 YEAR STRATEGIC PLAN (DECEMBER 2015) summary of accomplishments Goal Completed FY 0708 FY 0809 FY 0910 FY 1011 FY 1112 FY 12-13 FY 1314 FY 1516 Fuel Cell Evaluation Start up 300kW demonstration unit. • Evaluate cost feasibility of replacing or supplementing CGS engines with fuel • cell. Reclaiming Santa Ana River Interceptor Line(SARI)Flows-Meet with stakeholders,develop a list of obstacles that need to be overcome to reclaim the • SARI Line and develop a strategy to obtain regulatory approval to reclaim SARI Line flows.This goal was canceled due to inability to obtain regulatory approval. Sewer Rate for Green Development- Submit for Board approval an amendment • to sewer rate Ordinance with incentives for green developments. Complete Facilities Master Plan Update - Complete a comprehensive update of • the Facilities Master Plan and obtain Board approval Enterprise Information Technology Strategic Plan - Complete a District-wide • Information Technology Strategic Plan. Updating OCSD's Risk Register- Review and update OCSD's risk register to include an assessment oftechnical, regulatory, • financial,and political risks(among others) and possible mitigation strategies Annex Unincorporated Areas-With Board concurrence,annex unincorporated • areas onto OCSD's service area. Review Interagency Agreements- Conduct a comprehensive review of agreements with the Santa Ana Watershed • Project Authority and Irvine Ranch Water District,and,if appropriate,reopen for discussion. Strategic Business Plan-With Board concurrence,annually update and • implement the Strategic Plan and Business Plan. Business Accountability Charters- Create Business Accountability Charters for each department consistent with those • developed by managers and supervisors -F ORANGE COUNTY SANITATION DISTRICT—5 YEAR STRATEGIC PLAN(DECEMBER 2015) summary of accomplishments Goal Completed FY 07-08 FY 08-09 FY 09-10 FY 1011 FY 1112 FY 12-13 FY 1314 FY 15-16 Chemical Supplies- Develop a Chemical Sustainability Plan that provides OCSD with options for obtaining wastewater treatment • chemicals during chemical shortages, emergencies or complete stoppages. Chemical Sustalnablllty-Ensure a reliable and sustainable chemical supply using multiple vendor contracts to reduce the • risk of supply disruption while benefiting from competitive pricing. Full-Cost Recovery 2010-11-Conduct a comprehensive review of the Sanitation • District's Urban Runoff Program to ensure a fair share recovery of costs for services. Full-Cost Recovery 2012-1.3-Implement a direct charging mechanism to recover the full cost of urban runoff treatment starting July 1,2013 when the new rate structure • is in place.This goal was canceled in FY 12-13 to allow additional urban runoff at no cost to the local jurisdiction. Groundwater Replenishment System- Maximize the production of GWR System product water to augment and protect the • Orange County groundwater basin with a goal of 70 mgd. Sustainable Biosolids Program Complete new in-county Compost Take- • Back Program Plan Strategy. Evaluate the feasibility of deep injection/ methane recovery including commissioning a study of the geological formations • below Plants 1 and 2,and availability and acceptability of any existing wells Evaluate option of processing some biosolids at the City of Los Angeles • Terminal Island demonstration well. Implement Energy Master Plan -After the completion of the plan,assess final • recommendations to ensure adequate power resources and energy management. Disinfection of Final Effluent-Develop a cost effective program to sustain protection of public health associated with • bacteria in the effluent and incorporate program elements into our NPDES Permit. ORANGE COUNTY SANITATION DISTRICT-5 YEAR STRATEGIC PLAN (DECEMBER 2015) summary of accomplishments Goal Completed FY 0708 FY 08,09 FY 09-10 FY 1011 FY 1112 FY 12-13 FY 1314 FY 15 Sfi Ocean Protection - Undertake studies to determine the cause of benthic community changes near the ocean outfalI and take • corrective action to return affected areas to reference conditions. Space Planning Study Recommendations - Complete relocation of staff housed in Information Technology Trailers, • Administration Building,Control Center and Building 6. Improve the Sanitation District Security- Provide long-term security enhancements • at both treatment plants and within OCSD's Collection System. Safety and Health Strategic Plan - DevelopandimplementaSafetyand • Health Strategic Plan for all OCSD activities. Human Resources Strategic Plan- Design,develop and implement human resources policies, practices,systems and • tools to ensure OCSD has a workforce that meets future needs of OCSD and the public it serves. Succession Plan-Implement the Succession Management Plan including • management training and the creation of a Leadership Academy. North County Yard -Open the North County Maintenance Yard and complete the relocation of selected staff and equipment to the facility.Implement flex • space for added agency-wide needs as appropriate.This goal was canceled in FY 10-11 and the facility is currently being leased. Five-Year Rate Plan - Prepare an updated 5-year rate schedule for Board • consideration to go into effect July 1,2013 Sustainable Biosolids Program-Conduct research to reduce the amount of biosolids • produced and increase digester gas production Disinfection of Ocean Discharge-Develop an implementation plan includingthe technical,financial and societal factors • associated with cessation of disinfection of the ocean discharge Legislative Advocacy and Public Outreach- Develop a unified legislative advocacy and • public outreach program ORANGE COUNTY SANITATION DISTRICT-5 YEAR STRATEGIC PLAN (DECEMBER 2015) appendix C: glossary 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. 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. Business Accountability Charters—A business unit strategic plan. 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. coh are the most common bacteria in wastewater. Collections system—In wastewater,it is the system of typically underground pipes that receive and convey sanitary wastewater or Storm water. Certificate of Participation (COP)—A type of financing where an investor purchases a share of the lease revenues of a program rather than the bond being secured by those revenues. Contaminants of Potential Concern (CPC)—Pharmaceuticals,hormones,and other organic wastewater contaminants. Dashboard—A computer based business tool used to visually track performance. Dilution to Threshold(D/T)—the dilution at which the majority of the people detect the odor becomes the D/T for that air sample. 1,4-Dioxane—A chemical used in solvents for manufacturing, fumigants and automotive coolant.Like NDMA,it occurs in the Groundwater Replenishment System water and is eliminated with hydrogen peroxide and additional ultra-violet treatment. 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 will provide 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. Million gallons per day(mgd)—A measure of flow used in the water industry. Most Probable Number(MPN)—Number of organisms per 100 ml that would yield a test result or the observed test result with the greatest frequency. Commonly used for coliform bacteria. NDMA—N-Nitrosodimethylamine is an N-nitrosoamine suspected cancer-causing agent. It has been found in the Groundwater Replenishment System process and is eliminated using hydrogen peroxide with extra ultra-violet treatment. ORANGE COUNTY SANITATION DISTRICT-5 YEAR STRATEGIC PLAN (DECEMBER 2015) appendix C: glossary Nephelometric Turbidity Units (NTU)—An instrument for measuring the concentration of suspended particles in a liquid. O&M—Operations and maintenance of the treatment plants facilities and collections system. Publicly-owned Treatment Works (POTW)—Municipal wastewater Treatment plant. Recycling—The conversion of solid and liquid waste into usable materials or energy. Risk Register—An internal document that describes vulnerabilities of the Sanitation District. Santa Ana River Interceptor(SARI) Line—A regional brine fine designed to convey 30 million gallons per day (MGD) of non-reclaimable wastewater from the upper Santa Ana River basin to the ocean for disposal, after treatment. Sanitary sewer—Separate sewer systems specifically for the carrying of domestic and industrial wastewater. Combined sewers carry both wastewater and urban run-off. South Coast Air Quality Management District (SCAQMD)—Regional regulatory agency that develops plans and regulations designed to achieve public health standards by reducing emissions from business and industry. Secondary treatment—Biological wastewater treatment,particularly the activated-sludge process,where bacteria and other microorganisms consume dissolved nutrients in wastewater. Sludge—Untreated solid material created by the treatment of wastewater. Total suspended solids (TSS)—The amount of solids floating and in suspension in wastewater. Trickling filter—A biological secondary treatment process in which bacteria and other microorganisms, growing as slime on the surface of rocks or plastic media,consume nutrients in wastewater as it trickles over them. Urban runoff—Water from city streets and domestic properties that carry pollutants into the stomt 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. ;L ORANGE COUNTY SANITATION DISTRICT-5 YEAR STRATEGIC PLAN(DECEMBER 2015) lot is , < , �4ti r \ i p19 4OJN1V SAN,,—ON 2 p NO CrNQ THE SHV\Poa�W2 ORANGE COUNTY SANITATION DISTRICT 10844 Ellis Avenue Fountain Valley, CA 92708-7018 714.962.2411 www.ocsd.com