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HomeMy WebLinkAbout11-18-2015 Board Meeting Agenda Packet Orange County Sanitation District Wednesday, November 18, 2015 Regular Meeting of the b _ 6:00 P.M. BOARD OF DIRECTORS Board Room 10844 Ellis Avenue Fountain Valley, CA 92708 (714) 593-7433 AGENDA INVOCATION AND PLEDGE OF ALLEGIANCE: (Richard Murphy, City of Los Alamitos) ROLL CALL: DECLARATION OF QUORUM: PUBLIC COMMENTS: If you wish to address the Board of Directors on any item, please complete a Speaker's Form (located at the table outside of the Board Room)and submit it to the Clerk of the Board or notify the Clerk of the Board the item number on which you wish to speak. Speakers will be recognized by the Chairman and are requested to limit comments to three minutes. SPECIAL PRESENTATIONS: Safety Contest Winners REPORTS: The Chair and the General Manager may present verbal reports on miscellaneous matters of general interest to the Directors. These reports are for information only and require no action by the Directors. CONSENT CALENDAR: Consent Calendar Items are considered to be routine and will be enacted, by the Board of Directors, after one motion, without discussion. Any items withdrawn from the Consent Calendar for separate discussion will be considered in the regular order of business. 1. APPROVAL OF MINUTES (Clerk of the Board) RECOMMENDATION: A. Approve the minutes of the Special Board of Directors Meeting held on October 21, 2015; and 11/1&15 OCSD Board of Directors Agenda Page 1 of B. Approve the minutes of the Regular Board of Directors Meeting held on October 28, 2015. 2. PROPOSED BOARD OF DIRECTORS & COMMITTEE MEETING DATES FOR YEAR 2016. (Bob Ghirelli) RECOMMENDATION: Approve the calendar of meeting dates for the 2016 calendar year for meetings of the Board of Directors and the following Committees: Administration, Legislative and Public Affairs, Operations, and Steering. 3. EXTENSION OF LICENSE AGREEMENT FOR OPERATION OF HYDROGEN DISPENSING STATION (Nick Arhontes) RECOMMENDATION: Authorize the General Manager to execute First Amendment to the license agreement with Air Products and Chemicals, Inc.for the operation of a Hydrogen Dispensing Station at Plant 1, for the period ending October 31, 2016, at a cost not to exceed $18,407 monthly, in a form approved by General Counsel. 4. 2015-2016 WET WEATHER FLOW MONITORING SERVICES (Rob Thompson) RECOMMENDATION: Authorize a Purchase Order Contract for flow monitoring and rain gauge services using the City of San Jose California Master Consultant Agreement (CPMS 7183), with ADS Environmental Services Commencing November 23, 2015 through June 30, 2016, for a total amount not to exceed $330,000, in accordance with Ordinance OCSD-47, Section 2.03(B) Cooperative Purchases. OPERATIONS COMMITTEE: 5. APPROVAL OF MINUTES (Clerk of the Board) RECOMMENDATION: Approve Minutes of the November 4, 2015, Operations Committee Meeting. 6. MATERIALS TESTING, INSPECTION, AND OTHER GEOTECHNICAL TESTING SERVICES (Rob Thompson) RECOMMENDATION: Approve Amendment No. 1 to the Professional Services Agreement, PSA2013-001, with Sequoia Consultants, Inc., to provide on-call Materials Testing, Inspection, and other Geotechnical Testing Services for 11/18/15 OCSD Board of Directors Agenda Page 2 of 7 Collection System and Treatment Plant projects, for an amount not to exceed $100,000, increasing the total contract amount not to exceed $300,000. 7. ADDITIONAL SERVICES AND INCREASE TO AGREEMENT J-79-IA FOR CENTRAL GENERATION AUTOMATION/CONTINUOUS EMISSIONS MONITORING SYSTEMS (CEMS) (Ed Torres) RECOMMENDATION: Approve additional maintenance services to a Sole Source Purchase Order Service Agreement, J-79-1A with CEMTEK Environmental for maintenance of the Central Generation Engines continuous emissions monitoring systems, for an additional amount of$104,068, for a new total amount not to exceed $361,568, for the contract period ending November 22, 2017. ADMINISTRATION COMMITTEE: 8. VAX EMULATOR FOR PROCESS CONTROL SYSTEM, MODERNIZATION & SECURITY IMPROVEMENTS PROJECT (Lorenzo Tyner) RECOMMENDATION: A. Authorize a Purchase Order Contract with Quayle Consulting, Inc. for the procurement of Charon-VAX permanent licenses and maintenance in the amount of$338,401; and B. Approve a contingency of 10% ($33,840). 9. MICROSOFT ENTERPRISE LICENSE AGREEMENT (ELA) FOR MICROSOFT ENTERPRISE SOFTWARE LICENSES (Lorenzo Tyner) RECOMMENDATION: A. Authorize a Purchase Order with a three-year contract to purchase Microsoft Enterprise licenses under the Microsoft ELA in accordance with Microsoft Volume Enterprise Enrollment — for State and local government, Riverside County Master Licensing Agreement 01E73134, payable annually and with contract expiration date of December 31, 2018 for a total amount not to exceed $874,556.22; and B. Approve a contingency of 15% ($131,183.43). 11/18/15 OCSD Board of Directors Agenda Page 3 of 7 10. ENTERPRISE INFORMATION MANAGEMENT (EIM) STAFFING SUPPORT (Lorenzo Tyner) RECOMMENDATION: A. Approve a Service Contract with Project Partners, Inc. for Enterprise Information Management On-Call Staffing, Specification No. S-2015-72513D, for a period of January 1, 2016 through December 31, 2016, for a total annual amount not to exceed $121,800 with four one-year renewal options; and B. Approve a contingency of 20% ($24,360). 11. REPROGRAPHICS AND RELATED SERVICES (Lorenzo Tyner) RECOMMENDATION: A. Authorize a Purchase Order Contract with ARC Document Solutions, LLC for reprographics services per County of Orange Master Contract #RCA MA-017-16010366, for one 3-year period (11/04/15 — 11/03118) for an aggregate amount not to exceed $200,000 per year; and B. Approve the option of two additional one-year renewals for an amount not to exceed $200,000 per year. 12. CONSOLIDATED FINANCIAL REPORT FOR THE FIRST QUARTER ENDED SEPTEMBER 30, 2015 (Lorenzo Tyner) RECOMMENDATION: Receive and file Orange County Sanitation District First Quarter Financial Report for the period ended September 30, 2015. 13. ORANGE COUNTY SANITATION DISTRICT COMPREHENSIVE ANNUAL FINANCIAL REPORT (CAFR) FOR THE YEAR END JUNE 30, 2015. (Lorenzo Tyner) RECOMMENDATION: Receive and file the Sanitation District's Comprehensive Annual Financial Report for the year ended June 30, 2015, prepared by staff and audited by McGladrey, Certified Public Accountants, along with the following reports prepared by McGladrey: A. Report to the Administration Committee; and 11/18/15 OCSD Board of Directors Agenda Page 4 of 7 B. Independent Accountants' Report on Agreed-Upon Procedures Applied to Appropriations Limit Worksheets. 14. OWNER CONTROLLED INSURANCE PROGRAM EXTENSION (Celia Chandler) RECOMMENDATION: Approve the purchase of a multi-year extension of the Owner Controlled Insurance Program at a total cost of $725,612 for five policies covering three layers of liability coverage, workers compensation coverage, and pollution coverage, through December 31, 2017. STEERING COMMITTEE: 15. APPROVAL OF MINUTES (Clerk of the Board) RECOMMENDATION: Approve minutes of the October 28, 2015 meeting of the Steering Committee. 16. GENERAL MANAGER COMPENSATION AND BENEFITS (John Nielsen) RECOMMENDATION: Adopt Resolution No. OCSD 15-24 entitled, "A Resolution of the Board of Directors of Orange County Sanitation District amending the salary increase, salary range adjustment, and changes to benefits for the General Manager for Fiscal Year 2015-2016." LEGISLATIVE AND PUBLIC AFFAIRS COMMITTEE: 17. APPROVAL OF MINUTES (Clerk of the Board) RECOMMENDATION: Approve minutes of the November 9, 2015 meeting of the Legislative and Public Affairs Committee. NON-CONSENT CALENDAR: 18. PLANT 2 TRICKLING FILTER ODOR CONTROL SYSTEM UPGRADE, PROJECT NO. FE13-04 (Rob Thompson) RECOMMENDATION: A. Receive and file bid tabulation and recommendation; 11/18/15 OCSD Board of Directors Agenda Page 5 of 7 B. Award a construction contract to Kiewit Infrastructure West Co. for Plant 2 Trickling Filter Odor Control System Upgrade, Project No. FE13-04, for a total amount not to exceed $2,514,000; and C. Approve a contingency of$251,400 (10%). 19. EXTENSION OF AGREEMENT WITH EAST ORANGE COUNTY WATER DISTRICT (Jim Herberg) RECOMMENDATION: Authorize the General Manager to negotiate and execute an extension of the Local Sewer Facilities Transfer Agreement with East Orange County Water District regarding the transfer of local sewers in Service Area 7. AB 1234 REPORTS: INFORMATION ITEMS: None. CLOSED SESSION: None. OTHER BUSINESS AND COMMUNICATIONS OR SUPPLEMENTAL AGENDA ITEMS, IF ANY: ADJOURNMENT: Adjourn the Board meeting until the Regular Board of Directors Meeting on December 16, 2015, at 6:00 p.m. 11/1 W15 OCSD Board of Directors Agenda Page 6 of 7 Accommodations for the Disabled: Meeting Rooms are wheelchair accessible. If you require any special disability related accommodations, please contact the Orange County Sanitation District Clerk of the Board's office at(714)593-7433 at least 72 hours prior to the scheduled meeting. Requests must specify the nature of the disability and the type of accommodation requested. Agenda Posting: In accordance with the requirements of California Government Code Section 54954.2, this agenda has been posted outside the main gate of the Sanitation District's Administration Building located at 10844 Ellis Avenue, Fountain Valley, California, and on the Sanitation District's website at www.ocsd.com, not less than 72 hours prior to the meeting dale and time above. All public records relating to each agenda item, including any public records distributed less than 72 hours prior to the meeting to all, or a majority of the Board of Directors, are available for public inspection in the office of the Clerk of the Board. Agenda Description: The agenda provides a brief general description of each item of business to be considered or discussed. The recommended action does not indicate what action will be taken. The Board of Directors may take any action which is deemed appropriate. NOTICE TO DIRECTORS: To place items on the agenda for a Committee or Board Meeting,items must be submitted to the Clerk of the Board 14 days before the meeting. Kelly A. Lore Clerk of the Board (714)593-7433 klore(a).ocsd.cem For any questions on the agenda, Committee members may contact staff at: General Manager Jim Herberg (714)593-7300 iherbem(docsd.com Assistant General Manager Bob Ghirelli (714)593-7400 rghirelli(a)ocsd.com Director of Engineering Rob Thompson (714)593-7310 rthomoson(cDocsd.com Director of Facility Support Services Nick Amontes (714)593-7210 namontesAocsd.com Director of Finance and Lorenzo Tyner (714)593-7550 Iwneraocsd.com Administrative Services Director of Human Resources Celia Chandler (714)593-7202 cchandler(alocsd.com Director of Operations 6 Maintenance Ed Torres 714 593-7080 etorres ocsd.com 11/18/15 OCSD Board of Directors Agenda Pagel of7 ITEM NO. 1A Orange County Sanitation District MINUTES SPECIAL BOARD MEETING Strategic Plan Workshop October 21 , 2015 V�JNjy SANIIgTjQy Q ? ¢ c� o � Fcl�N FIE ENv`P0� Administration Building 10844 Ellis Avenue Fountain Valley, California 92708-7018 10/21/2015 Minutes of Board Meeting Page 1 of 4 ROLL CALL A SPECIAL meeting of the Board of Directors of the Orange County Sanitation District was called to order on October 21, 2015, at 6:12 p.m. by Chair Nielsen, in the Administration Building. Director Beamish delivered led the Pledge of Allegiance. The Clerk of the Board declared a quorum present as follows: ACTIVE DIRECTORS ALTERNATE DIRECTORS X John Nielsen, Chair Allan Bernstein X Gregory Sebourn Doug Chaffee X Lisa Bartlett Michelle Steel X Tom Beamish X Rose Espinoza Steven Choi Lynn Schott Keith Curry Scott Peotter X Ellery Deaton X Sandra Massa-Lavitt Tyler Diep X Joy Neugebauer James M. Ferryman X Bob Ooten X Steven Jones Kris Beard Jim Katapodis X Erik Peterson X Robert Kiley X Michael Beverage Peter Kim X Michele Steggell X Lucille Kring Jordan Brandman X Greg Mills Robert Collaoott X Richard Murphy Shelley Hasselbrink Steve Nagel MichaelVo X Glenn Parker X Cecilia Hupp X David Shawver Carol Warren Fred Smith Steve Berry Teresa Smith Mark Murphy Sal Tinajero David Benavides X Chad Wanke Constance Underhill John Withers Douglas Reinhart X Mariellen Yarc Stacy Berry STAFF MEMBERS PRESENT: Jim Herberg, General Manager; Bob Ghirelli, Assistant General Manager; Rob Thompson, Director of Engineering, Lorenzo Tyner, Director of Finance & Administrative Services; Ed Torres, Director; Kelly Lore, Clerk of the Board; Jennifer Cabral; Jim Colston; Mark Esquer; Norbert Gaia; Al Garcia; Kathy Millea; Jeff Mohr; Louis Pasoz and Paula Zeller. OTHERS PRESENT: Brad Hogin (General Counsel); Kristine Thalman, K.E Thalman & Associates; and Rich ten Busch, Black & Veatch. 10/21/2015 Minutes of Board Meeting Page 2 of 4 PUBLIC COMMENTS: None. OPENING REMARKS (Jim Herberg, General Manager) Chair Nielsen welcomed everybody to the meeting, briefly reviewed the meeting's agenda; introduced facilitator, Kristine Thalman and provided her biography. General Manager, Jim Herberg provided a PowerPoint presentation and explained the Strategic Plan's process, goals and objectives from 2013 including: Customer Service; Protecting Public Health and the Environment; Managing&Protecting the Public's Funds; Stakeholder Understanding & Support; and Organizational Effectiveness. Mr. Herberg then identified the"Big 5", areas that he will focus on as described in the General Manager Work plan for FY 2015-16. These areas include: Safety and security, Succession planning, Resource recovery, Reliability, and Operational optimization. DISTRICT ACCOMPLISHMENTS (Bob Ghirelli, Assistant General Manager) Assistant General Manager, Bob Ghirelli continued with the PowerPoint presentation and provided a progress update on the eight key goals of the Strategic Plan including: Odor Control Master Plan; future water recycling; energy efficiency; local sewer transfers; disinfection of ocean discharge; workforce planning and development; future biosolids management options; and legislative advocacy and public outreach. Mr. Ghirelli also announced the successful levels of service of the agency. Alternate Director Peterson departed the meeting at 6:35 p.m. SUMMARY OF BOARD INTERVIEWS (Kristine Thalman, K.E. Thalman &Associates) Ms. Kristine Thalman reported on identified Board of Directors priorities which were based on interviews with ten of the 25 Board of Directors, and consisted of six questions related to the eight initiatives of the Strategic Plan. Ms. Thalman provided the Board a written summary and then verbally reviewed the responses and comments to those questions; and asked for any further input to be provided for discussion this evening. Chair Nielsen commended the efficiency of the OCSD staff in this process, and complimented those Board members who were interviewed and supplied technical information to Ms. Thalman. He stated his main concern is making the public aware of the cultural transformation of OCSD becoming a product producer. Suggestions were offered by the Board on topics including: community outreach efforts; sole source providers; continued budget efficiencies; and website enhancement. Mr. Herberg concluded that most of the suggested items fall under his GM work plan and he will provide a report back in the future. 10/21/2015 Minutes of Board Meeting Page 3 of 4 Several Board members commended the agency and the staff. PRESENTATION OF ISSUE PAPER (Rob Thompson, Director of Engineering) Director of Engineering, Rob Thompson provided Issue Paper No. 1 regarding Stormwater Capture providing information on governance; flow rates; OCSD Urban Runoff Program; and risks of the capture. Mr. Thompson stated staffs recommendation to the Board is to continue the current urban runoff policy, protect the collection system and treatment plants and continue to support the other agencies that manage stormwater capture. El Nino preparation and systems were discussed. Questions of the stormwater capture processes were answered by Mr. Thompson and Mr. Herberg. Mr. Herberg stated that the Orange County Water District will provide additional information at a presentation in the future. Alternate Director Steggell departed the meeting at 7:51 p.m. Director Jones and Director Wanke departed the meeting at 7:55 p.m. PRESENTATION OF ISSUE PAPER (Mark Esquer, Engineering Manager) Engineering Manager, Mark Esquer provided information regarding Collections system dosing stations and the problematic method of maintaining the best Level of Service target of Collection System Odor Complaints. Mr. Esquer stated that staffs recommendation is to increase the Level of Service target of Collections System Odor complaints to 28 from 12. The Board held brief dialogue regarding the responsibility of balancing the level of service with the cost involved. FACILITATION OF DISCUSSION, REVIEW AND WRAP-UP (Kristine Thalman, K.E. Thalman &Associates) Ms. Thalman concluded the evening by stating that there are no additional objectives or goals to add to the current Strategic plan at this time. If anyone has additional comments or suggestions, please contact General Manager, Jim Herberg. ADJOURNMENT: At 8:07 p.m. Chair Nielsen adjourned the meeting until the Regular Board Meeting on October 28, 2015 at 6:00 p.m. Kelly A. Lore Clerk of the Board 10/21/2015 Minutes of Board Meeting Page 4 of 4 ITEM NO. 16 Orange County Sanitation District MINUTES BOARD MEETING October 28, 2015 �OJNjy SANII'gTjQy Q ? ¢ c, o � Fcl�N FIE Administration Building 10844 Ellis Avenue Fountain Valley, California 92708-7018 1 012 812 01 5 Minutes of Board Meeting Page 1 of 10 ROLL CALL A regular meeting of the Board of Directors of the Orange County Sanitation District was held on October 28, 2015, at 6:03 p.m., in the Administration Building. Director Kim delivered the invocation and led the Pledge of Allegiance. The Clerk of the Board declared a quorum present as follows: ACTIVE DIRECTORS ALTERNATE DIRECTORS X John Nielsen, Chair Allan Bernstein X Gregory Sebourn Doug Chaffee X Lisa Bartlett Michelle Steel X Tom Beamish Rose Espinoza Steven Choi X Lynn Schott Keith Curry X Scott Peotter X Ellery Deaton Sandra Massa-Lavitt A Tyler Diep Joy Neugebauer James M. Ferryman X Bob Ooten A Steven Jones Kris Beard X Jim Katapodis Erik Peterson X Robert Kiley Michael Beverage X Peter Kim Michele Steggell X Lucille Kring Jordan Brandman X Greg Mills Robert Collaoott X Richard Murphy Shelley Hasselbrink X Steve Nagel MichaelVo X Glenn Parker Cecilia Hupp X David Shawver Carol Warren A Fred Smith Steve Berry Teresa Smith X Mark Murphy X Sal Tinajero David Benavides X Chad Wanke Constance Underhill X John Withers Douglas Reinhart X Mariellen Yarc Stacy Berry STAFF MEMBERS PRESENT: Jim Herberg, General Manager; Bob Ghirelli, Assistant General Manager; Lorenzo Tyner, Director of Finance & Administrative Services; Celia Chandler, Director of Human Resources; Ed Torres, Director of Operations & Maintenance; Kelly Lore, Clerk of the Board; Jennifer Cabral; Don Cutler; Mark Esquer; Dean Fisher; Norbert Gaia; Al Garcia; Bill Pease; Carrie Robles; and Paula Zeller. OTHERS PRESENT: Brad Hogin (General Counsel); and Michael Beverage (Alternate Director YLWD). 10/25/2015 Minutes of Board Meeting Page 2 of 10 PUBLIC COMMENTS: None. SPECIAL PRESENTATIONS: Isaac Aziz, Municipal Information Systems Association of California presented the Excellence in IT Practices Award to IT Systems & Operations Manager, Rich Castillon. Director of Finance and Administrative Services, Lorenzo Tyner presented a 25 year service award to IT Systems & Operations Manager Rich Castillon. Chair Nielsen presented a 20 year service award to General Manager Jim Herberg. REPORTS: Chair Nielsen reported on the success of the 2015 State of the District including the District's accomplishments and the Annual Report which provided the first communication piece that emphasized our"brand" as a resource recovery facility. Chair Nielsen also reported on the strategic planning session that was held on October 21. Staff will compile the information, make any necessary changes and bring it back in December for adoption. He also announced that Adam Hutchinson, OCWD's Recharge Planning Manager, will make a presentation on storm water capture to the OCSD Committees in November. Chair Nielsen then provided an update from the Legislative and Public Affairs (LAPA) Committee including: outreach and educational efforts; State and Federal Lobbyist contract renewals; and the upcoming presentation from Adam Link with CASA at the November LAPA Committee meeting. General Manager Jim Herberg introduced and welcomed the new Director of Human Resources, Celia Chandler. He also provided a summarization of the performance based pay increases that he distributed to the Executive Management Team and Managers this fiscal year, as approve by the Board of Directors in September. CONSENT CALENDAR: 1. APPROVAL OF MINUTES (Clerk of the Board) MOVED, SECONDED, AND DULY CARRIED TO: Approve minutes of the Regular Board of Directors Meeting held on September 23, 2015. AYES: Bartlett; Beamish; Deaton; Katapodis; Kiley; Kim; Kring; Mills; R. Murphy; Nagel; Nielsen; Ooten (Alternate); Parker; Schott 10/29/2015 Minutes of Board Meeting Page 3 of 10 (Alternate); Sebourn; Shawver; Tinajero; Wanke; Withers and Yarc NOES: None ABSTENTIONS: M. Murphy (Alternate); and Peotter (Alternate) ABSENT: Diep; Jones; and F. Smith OPERATIONS COMMITTEE: 2. APPROVAL OF MINUTES (Clerk of the Board) MOVED, SECONDED, AND DULY CARRIED TO: Approve Minutes of the October 7, 2015, Operations Committee Meeting. AYES: Bartlett; Beamish; Deaton; Katapodis; Kiley; Kim; Kring; Mills; M. Murphy (Alternate); R. Murphy; Nagel; Nielsen; Ooten (Alternate); Parker; Peotter (Alternate); Schott (Alternate); Sebourn; Shawver; Tinajero; Wanke; Withers and Yarc NOES: None ABSTENTIONS: None ABSENT: Diep; Jones; and F. Smith 3. INDUSTRIAL CLEANING SERVICES, SPECIFICATION NO. 5-2015-714BD (Nick Arhontes) MOVED, SECONDED, AND DULY CARRIED TO: A. Award a service contract to Performance Pipeline Technologies for Industrial Cleaning Services, Specification No. S-2015-71413D, for a total amount not to exceed $526,500 for the period December 11, 2015 through December 10, 2016, with four one-year renewal options; and B. Approve a contingency of$105,300 (20%). AYES: Bartlett; Beamish; Deaton; Katapodis; Kiley; Kim; Kring; Mills; M. Murphy (Alternate); R. Murphy; Nagel; Nielsen; Ooten (Alternate); Parker; Peotter (Alternate); Schott (Alternate); Sebourn; Shawver; Tinajero; Wanke; Withers and Yarc NOES: None ABSTENTIONS: None ABSENT: Diep; Jones; and F. Smith 4. EXTENSION OF LICENSE AGREEMENT FOR OPERATION OF HYDROGEN DISPENSING STATION (Nick Arhontes) MOVED, SECONDED, AND DULY CARRIED TO: Authorize the General Manager to negotiate an extension of the license agreement with Air Products and 10/29/2015 Minutes of Board Meeting Page 4 of 10 Chemicals, Inc. for the operation of a Hydrogen Dispensing Station at Plant 1 in a form recommended by General Counsel. AYES: Bartlett; Beamish; Deaton; Katapodis; Kiley; Kim; Kring; Mills; M. Murphy (Alternate); R. Murphy; Nagel; Nielsen; Ooten (Alternate); Parker; Peotter (Alternate); Schott (Alternate); Sebourn; Shawver; Tinajero; Wanke; Withers and Yarc NOES: None ABSTENTIONS: None ABSENT: Diep; Jones; and F. Smith 5. DISTRICT 6 TRUNK SEWER RELIEF, PROJECT NO. 6-17 (Rob Thompson) MOVED, SECONDED, AND DULY CARRIED TO: Approve a contingency increase of $86,481 (15%) to the Professional Design Services Agreement with RMC Water& Environment (RMC)for District 6 Trunk Sewer Relief, Project No. 6- 17, for a total contingency of$144,135 (25%). AYES: Bartlett; Beamish; Deaton; Katapodis; Kiley; Kim; Kring; Mills; M. Murphy (Alternate); R. Murphy; Nagel; Nielsen; Ooten (Alternate); Parker; Peotter (Alternate); Schott (Alternate); Sebourn; Shawver; Tinajero; Wanke; Withers and Yarc NOES: None ABSTENTIONS: None ABSENT: Diep; Jones; and F. Smith 6. AWARD OF ON-CALL MAINTENANCE AND REPAIR SERVICES MASTER CONTRACTS -SPECIFICATION NO. 5-2015-700 (Ed Torres) MOVED, SECONDED, AND DULY CARRIED TO: A. Approve Master Contracts for providing maintenance and repair services, Specification No. 5-2015-700, for a one-year period effective December 1, 2015 through November 30, 2016, with two (2) one-year renewal options, in accordance with Ordinance OCSD-47, Section 2.03 (H), with the following 7 qualified firms, for bids less than $100,000: 1. J.R. Filanc Construction Company 2. Charles King Company 3. W.A. Rasic Construction Company, Inc. 4. Jamison Engineering Contractors, Inc. 5. United Riggers and Erectors, Inc. 6. SS Mechanical Corp. 7. O'Connell Engineering & Construction Inc.; and B. Authorize the General Manager to add or delete firms as necessary to maintain a qualified base of up to 7 firms in accordance to Request for Qualifications Specification No. S-2015-700. 10/29/2015 Minutes of Board Meeting Page 5 of 10 AYES: Bartlett; Beamish; Deaton; Katapodis; Kiley; Kim; Kring; Mills; M. Murphy (Alternate); R. Murphy; Nagel; Nielsen; Ooten (Alternate); Parker; Peotter (Alternate); Schott (Alternate); Sebourn; Shawver; Tinajero; Wanke; Withers and Yarc NOES: None ABSTENTIONS: None ABSENT: Diep; Jones; and F. Smith 7. NEWPORT FORCE MAIN REHABILITATION, PROJECT NO. 5-60 (Rob Thompson) MOVED, SECONDED, AND DULY CARRIED TO: A. Approve a project budget increase of$5,913,000, for a total project budget of $64,000,000 for Newport Force Main Rehabilitation, Project No. 5-60; and B. Approve a contingency increase of $3,671,500 (10%) to the construction contract with Kiewit Infrastructure West Company for Newport Force Main Rehabilitation, Project No. 5-60, for a total contingency of $11,014,500 (30%). AYES: Bartlett; Beamish; Deaton; Katapodis; Kiley; Kim; Kring; Mills; M. Murphy (Alternate); R. Murphy; Nagel; Nielsen; Ooten (Alternate); Parker; Peotter (Alternate); Schott (Alternate); Sebourn; Shawver; Tinajero; Wanke; Withers and Yarc NOES: None ABSTENTIONS: None ABSENT: Diep; Jones; and F. Smith 8. HEADQUARTERS COMPLEX, SITE AND SECURITY, AND ENTRANCE REALIGNMENT PROGRAM, PROJECT NO. P1-128 (Rob Thompson) MOVED, SECONDED, AND DULY CARRIED TO: Designate the southwest corner of Plant No. 1 forthe location forthe Administration Building and Laboratory Building as the preferred alternative for CEQA evaluation under the Headquarters Complex, Site and Security, and Entrance Realignment Program, Project No. P1- 128. AYES: Bartlett; Beamish; Deaton; Katapodis; Kiley; Kim; Kring; Mills; M. Murphy (Alternate); R. Murphy; Nagel; Nielsen; Ooten (Alternate); Parker; Peotter (Alternate); Schott (Alternate); Sebourn; Shawver; Tinajero; Wanke; Withers and Yarc NOES: None ABSTENTIONS: None ABSENT: Diep; Jones; and F. Smith 10/29/2015 Minutes of Board Meeting Page 6 of 10 ADMINISTRATION COMMITTEE: 9. APPROVAL OF MINUTES (Clerk of the Board) MOVED, SECONDED, AND DULY CARRIED TO: Approve minutes of the October 14, 2015 meeting of the Administration Committee Meeting. AYES: Bartlett; Beamish; Deaton; Katapodis; Kiley; Kim; Kring; Mills; M. Murphy (Alternate); R. Murphy; Nagel; Nielsen; Ooten (Alternate); Parker; Peotter (Alternate); Schott (Alternate); Sebourn; Shawver; Tinajero; Wanke; Withers and Yarc NOES: None ABSTENTIONS: None ABSENT: Diep; Jones; and F. Smith 10. COOPERATIVE PROCUREMENT WITH ADMIN MINNESOTA MATERIALS MANAGEMENT DIVISION MINNESOTA WSCA-NASPO MASTER AGREEMENT (Lorenzo Tyner) MOVED, SECONDED, AND DULY CARRIED TO: Authorize purchases of information technology computer and peripheral equipment using the Admin Minnesota Department of Administration, Materials Management Division, Minnesota WSCA-NASPO Master Agreement number MNWNC-115 through the contract expiration date, March 31, 2017 for a total amount not to exceed $500,000, in accordance with Ordinance OCSD47, Section 2.03(B) Cooperative Purchases. AYES: Bartlett; Beamish; Deaton; Katapodis; Kiley; Kim; Kring; Mills; M. Murphy (Alternate); R. Murphy; Nagel; Nielsen; Ooten (Alternate); Parker; Peotter (Alternate); Schott (Alternate); Sebourn; Shawver; Tinajero; Wanke; Withers and Yarc NOES: None ABSTENTIONS: None ABSENT: Diep; Jones; and F. Smith 11. ELECTRONIC RECORDING MEMORANDUM OF UNDERSTANDING COUNTY OF ORANGE CLERK-RECORDER'S OFFICE (Bob Ghirelli) MOVED, SECONDED, AND DULY CARRIED TO: A. Approve the Electronic Recording Memorandum of Understanding (MOU) between the County of Orange and Orange County Sanitation District for the use of the Secure Government to Government (G2G) Portal for a term of five (5) years; and B. Authorize the Clerk of the Board, or her designee, to transmit/record any and all required Orange County Sanitation District real property documents in an electronic format. 10/29/2015 Minutes of Board Meeting Page 7 of 10 AYES: Bartlett; Beamish; Deaton; Katapodis; Kiley; Kim; Kring; Mills; M. Murphy (Alternate); R. Murphy; Nagel; Nielsen; Ooten (Alternate); Parker; Peotter (Alternate); Schott (Alternate); Sebourn; Shawver; Tinajero; Wanke; Withers and Yarc NOES: None ABSTENTIONS: None ABSENT: Diep; Jones; and F. Smith 12. GENERAL MANAGER APPROVED PURCHASES (Lorenzo Tyner) MOVED, SECONDED, AND DULY CARRIED TO: Receive and file District purchases made under the General Manager's authority for the period of July 1, 2015—September 30, 2015. AYES: Bartlett; Beamish; Deaton; Katapodis; Kiley; Kim; Kring; Mills; M. Murphy (Alternate); R. Murphy; Nagel; Nielsen; Ooten (Alternate); Parker; Peotter (Alternate); Schott (Alternate); Sebourn; Shawver; Tinajero; Wanke; Withers and Yarc NOES: None ABSTENTIONS: None ABSENT: Diep; Jones; and F. Smith STEERING COMMITTEE: 13. APPROVAL OF MINUTES (Clerk of the Board) MOVED, SECONDED, AND DULY CARRIED TO: Approve minutes of the September 23, 2015 meeting of the Steering Committee. AYES: Bartlett; Beamish; Deaton; Katapodis; Kiley; Kim; Kring; Mills; M. Murphy (Alternate); R. Murphy; Nagel; Nielsen; Ooten (Alternate); Parker; Peotter (Alternate); Schott (Alternate); Sebourn; Shawver; Tinajero; Wanke; Withers and Yarc NOES: None ABSTENTIONS: None ABSENT: Diep; Jones; and F. Smith LEGISLATIVE AND PUBLIC AFFAIRS COMMITTEE: 14. APPROVAL OF MINUTES (Clerk of the Board) MOVED, SECONDED, AND DULY CARRIED TO: Approve minutes of the October 12, 2015 meeting of the Legislative and Public Affairs Committee. AYES: Bartlett; Beamish; Deaton; Katapodis; Kiley; Kim; Kring; Mills; M. Murphy (Alternate); R. Murphy; Nagel; Nielsen; Ooten (Alternate); Parker; Peotter (Alternate); Schott (Alternate); Sebourn; Shawver; Tinajero; Wanke; Withers and Yarc 10/29/2015 Minutes of Board Meeting Page 8 of 10 NOES: None ABSTENTIONS: None ABSENT: Diep; Jones; and F. Smith 15. AUTHORIZATION OF CONTRIBUTION TO CASA EDUCATION FOUNDATION SCHOLARSHIP FUND (Bob Ghirelli) MOVED, SECONDED, AND DULY CARRIED TO: Adopt Resolution No. OCSD 15-22,entitled "A Resolution of the Board of Directors of the Orange County Sanitation District approving an annual contribution in the amount of$5,000 to the California Association of Sanitation Agencies (CASA) Education Foundation beginning in FY 2015-2016." AYES: Bartlett; Beamish; Deaton; Katapodis; Kiley; Kim; Kring; Mills; M. Murphy (Alternate); R. Murphy; Nagel; Nielsen; Ooten (Alternate); Parker; Peotter (Alternate); Schott (Alternate); Sebourn; Shawver; Tinajero; Wanke; Withers and Yarc NOES: None ABSTENTIONS: None ABSENT: Diep; Jones; and F. Smith NON-CONSENT CALENDAR: 16. GENERAL MANAGER COMPENSATION AND BENEFITS (John Nielsen) MOVED, SECONDED, AND DULY CARRIED TO: Adopt Resolution No. OCSD 15-23 entitled, "A Resolution of the Board of Directors of the Orange County Sanitation District approving salary increase, salary range adjustment, and changes to benefits for the General Manager for Fiscal Year 2015-2016," authorizing the Board Chair to implement a base building salary increase and corresponding salary range adjustment of 7% retroactive to July 10, 2015, and changes to the benefits package for the General Manager, for a total amount not to exceed $41,107. A roll call vote was taken by Clerk of the Board Kelly Lore. AYES: Bartlett; Beamish; Deaton; Katapodis; Kiley; Kim; Kring; Mills; R. Murphy; Nagel; Nielsen; Ooten (Alternate); Parker; Schott (Alternate); Sebourn; Shawver; Tinajero; Wanks; Withers and Yarc NOES: None ABSTENTIONS: M. Murphy (Alternate); and Peotter (Alternate) ABSENT: Diep; Jones; and F. Smith 10/29/2015 Minutes of Board Meeting Page 9 of 10 AB 1234 REPORTS: Chair Nielsen reported on his attendance at the recent GWRS Steering Committee Meeting and the upcoming plans to improve flow; currently GW RS is receiving an average of 98 mgd. INFORMATION ITEMS: None. CLOSED SESSION: General Counsel, Brad Hogin announced that there will be no closed session held this evening. OTHER BUSINESS AND COMMUNICATIONS OR SUPPLEMENTAL AGENDA ITEMS, IF ANY: None. ADJOURNMENT: At 6:31 p.m. Chair Nielsen adjourned the meeting until the Regular Board Meeting on November 18, 2015 at 6:00 p.m. Kelly A. Lore Clerk of the Board 10/29/2015 Minutes of Board Meeting Page 10 of 10 BOARD OF DIRECTORS Meeting Dare Meeting Date -- 11/18/Js AGENDA REPORT ItemNumber IemNumber z Orange County Sanitation District FROM: James D. Herberg, General Manager Originators: Robert P. Ghirelli, Assistant General Manager SUBJECT: PROPOSED BOARD OF DIRECTORS & COMMITTEE MEETING DATES FOR YEAR 2016. GENERAL MANAGER'S RECOMMENDATION Approve the calendar of meeting dates for the 2016 calendar year for meetings of the Board of Directors and the following Committees: Administration, Legislative and Public Affairs, Operations, and Steering. SUMMARY According to Resolution OCSD 15-01 - Rules of Procedure for the Conduct of Business of the District, Section (1)(a), a regular monthly meeting of the Board of Directors of the District will be held on the fourth Wednesday of every month at 6:00 p.m. The four standing committees meet regularly as follows: • Operations Committee First Wednesday of every month at 5:00 p.m. • Legislative and Public Second Monday of every month at 8:00 a.m. Affairs Committee (exception applies quarterly-see below) • Administration Committee Second Wednesdayof every month at 5:00 p.m. • Steering Committee Fourth Wednesday of every month at 5:00 p.m. Staff is recommending the following dates for the 2016 calendar year. Should the need arise for a change in date or time, advanced notice will be given to the Board or Committee. The recommended dates for the 2016 calendar year are: Operations Legislative&Public Affairs Administration Committee Committee Committee Board &Steering January 6, 2016 January DARK' January DARK* January 27, 2016 February 3, 2016 February 8, 2016 February 10, 2016 February 24, 2016 March 2, 2016 March 14, 2016 March 9, 2016 March 23, 2016 April 6, 2016 April 11,2016 (3:30 p.m.) April 13,2016 April 27, 2016 May 4, 2016 May 9, 2016 May 11, 2016 May 25, 2016 June 1, 2016 June 13, 2016 June 8,2016 June 22,2016 July 6, 2016 July 11, 2016 (3:30 p.m.) July 13, 2016 July 27, 2016 August DARK' August DARK" August DARK" August 24, 2016 Page 1 of 2 September 7, 2016 September 12, 2016 September 14, 2016 September 28, 2016 October 5, 2016 October 10, 2016 (3:30 p.m.) October 12, 2016 October 26, 2016 November 2,2016 November 14, 2016 November 9, 2016 November 16, 2016" December 7,2016 December 12, 2016 December 14, 2015 December 21, 2016" Committee is dark in this month. "'Meeting scheduled to take place the third Wednesday of the month due to Thanksgiving 8 Christmas Holidays. Page 2 of 2 BOARD OF DIRECTORS Meeting Date TOBd.Of Dir. 11 ,11 /18/15 AGENDA REPORT ItemNumber IemNumber s Orange County Sanitation District FROM: James D. Herberg, General Manager Originator: Nick Arhontes, Director of Facilities Support Services SUBJECT: EXTENSION OF LICENSE AGREEMENT FOR OPERATION OF HYDROGEN DISPENSING STATION GENERAL MANAGER'S RECOMMENDATION Authorize the General Manager to execute First Amendment to the license agreement with Air Products and Chemicals, Inc. for the operation of a Hydrogen Dispensing Station at Plant 1, for the period ending October 31, 2016, at a cost not to exceed $18,407 monthly, in a form approved by General Counsel. SUMMARY With the assistance of the General Counsel, the General Manager has negotiated an extension to the license agreement with Air Products and Chemicals, Inc. (APCI) of Allentown, PA. This agreement will allow Orange County Sanitation District (Sanitation District) to continue to be a host site for the hydrogen fuel dispensing station for an additional 12 months. The station uses hydrogen supplied by APCI in the process area at Plant No. 1. This action also fulfills the Sanitation District's obligation as related to the supplemental environmental project (SEP) negotiated with SCAQMD in December 2014. PRIOR COMMITTEE/BOARD ACTIONS October 2015—Approved the General Manager to negotiate an extension of the license agreement for operation of hydrogen dispensing station. April 2015—Approved a license agreement for operation of hydrogen dispensing station. December 2014 — Approved a supplemental environmental project (SEP) for air quality compliance. ADDITIONAL INFORMATION Detailed costs are shown in the amendment on page 2. The dispensing station and its necessary support systems were a part of a previously approved research and demonstration project hosted at Plant No. 1. The project converted the Sanitation District's digester gas (which is a renewable fuel) into electricity and hydrogen fuel for vehicles. Depending on public usage to fuel private vehicles, we may see four to six Page 1 of 2 deliveries per month as the new full trailer is swapped out for an empty one by APCI. Fuel costs are typically a part of the vehicle's lease or purchase agreement with the vehicle manufacturer. The Sanitation District is not a party to this commercial arrangement. After 12 months, the Sanitation District will have no further obligation to continue supporting the hydrogen fueling stations. CEQA N/A BUDGET/PURCHASING ORDINANCE COMPLIANCE The funds will be transferred from the General Manager's Contingency into the Regulatory Fees expense line item. ATTACHMENT The following attachment(a) maybe viewed on-line at the OCSD website (www.ocsd.com) with the complete agenda package: • First Amendment to License Agreement • Original License Agreement Page 2 of 2 FIRST AMENDMENT TO LICENSE AGREEMENT FOR OPERATION OF HYDROGEN DISPENSING STATION This First Amendment to License Agreement for Operation of Hydrogen Dispensing Station ("Amendment") is made this day of , 2015 ("Effective Date") by and between the ORANGE COUNTY SANITATION DISTRICT, a County Sanitation District ("Licensor"), and AIR PRODUCTS AND CHEMICALS, INC., a Delaware corporation ("Licensee"). Licensor and Licensee are sometimes referred to herein as the "Parties" and individually as a "Party." RECITALS WHEREAS, the Parties entered into that certain "License Agreement for Operation of Hydrogen Dispensing Station" dated July 1, 2015 ("License Agreement"), incorporated herein by this reference. WHEREAS, the License Agreement will expire on October 31, 2015. WHEREAS,the Parties desire to extend the term of the License Agreement in order to ensure the continued operation of the Hydrogen Dispensing Station, and to fulfill Licensor's obligations to South Coast Air Quality Management District to provide a Supplemental Environmental Project. WHEREAS, the Parties desire to amend the License Agreement to afford mutual termination rights. WHEREAS, the Parties desire to amend the License Agreement to provide for the monthly payment of operating costs by Licensor to Licensee. WHEREAS, Licensor shall continue to provide to Licensee,the site, utilities, security, and staff to oversee the administration of the License Agreement, as an in-kind service. NOW, THEREFORE, in consideration of the mutual promises set forth herein, the Parties agree as follows: A. Extension of Term and Termination. Section 3 of the License Agreement is hereby amended to read as follows: "3. Term. The term of this Agreement shall expire on October 31, 2016 unless earlier terminated as provided herein. Either Party may unilaterally terminate this Agreement with or without cause upon thirty(30) calendar day's written notice to the other Party." 1121716.2 B. Operating Costs. Section 4 of the License Agreement is hereby amended to read as follows: "4. Payment. Licensor agrees to pay Licensee for the following costs of operation of the Dispensing Station ("Monthly Operating Cost"): ITEM MONTHLY OPERATING COST Dispensing Station $3,900 Depreciation Dispensing Station $4,000 Maintenance Tube Trailer Rental Costs $3,900 Operating Services from $4,000 National Fuel Cell Research Center Electricity Costs $0 Subtotal $16 800 General and Administrative $2,807 16.5% Total $18 407 Licensee shall invoice Licensor for the Monthly Operating Cost, and payments shall be net thirty (30) days of the date shown on Licensee's commercial invoices. Late payment shall be subject to a late charge of 1.5% per month or the highest amount allowed by applicable law, if lower." C. Except as expressly modified above, all other terms and conditions of the License Agreement shall remain unchanged and in full force and effect. [Signatures on Following Page] 1121716.2 IN WITNESS WHEREOF,the Parties have executed and entered into this Agreement as of the date first written above "Licensor" ORANGE COUNTY SANITATION DISTRICT By General Manager Date By Clerk of the Board Date Approved as to Form: General Counsel "Licensee" AIR PRODUCTS AND CHEMICALS, INC. By: Name: Marie A. olkes Title: President, Industrial Gases Americas V4l1O Im1f16.1 LICENSE AGREEMENT FOR OPERATION OF OR/01�{e HYDROGEN DISPENSING STATION This License Agreement("Agreement")is made and entered into this 1st day of July , 2015 ("Effective Date"), by and between the ORANGE COUNTY SANITATION DISTRICT, a County Sanitation District ("Licensor"), and AIR PRODUCTS AND CHEMICALS, INC.,a Delaware corporation("Licensee"). Licensor and Licensee are sometimes referred to herein as the "Parties" and individually as a "Party.„ 1. Premises. Located at 10844 Ellis Avenue, Fountain Valley, CA 92708, inclusive of the Hydrogen Energy and Supply Station,Hydrogen Supply Line, and Hydrogen Dispensing and Compressor Equipment, as more particularly described and depicted in Exhibit"A"attached hereto. 2. Permit to Enter Premises. Licensor grants to Licensee a nonexclusive revocable license to enter and use the Premises for the sole purpose set forth in Section 5 hereof and for no other purpose,subject to Licensee's compliance with all of the terms of this Agreement. Licensee acknowledges and agrees that it is not a tenant on the Premises and any rights or benefits which may accrue to Licensee by reason of execution of this Agreement or use of the Premises shall solely be those of a licensee and not a tenant- 3- Term. The term of this Agreement shall expire on October 31, 2015 unless earlier terminated by Licensee as provided herein. Licensee may unilaterally terminate this Agreement with or without cause upon thirty (30) calendar day's written notice to Licensor. 4. Consideration. As consideration for the license granted in this Agreement, Licensee shall pay to Licensor an annual fee of one dollar(S1.00), payable in advance. Commencing on the fifth month following the Effective Date, and continuing thereafter, License shall pay to Licensor a monthly fee of six hundred and ninety dollars (S690), payable in advance, which sum represents the apportioned cost of utilities servicing the Premises. 5. Use. Licensee shall use the Premises solely for the operation of a hydrogen dispensing station("Dispensing Station")that is accessible by the public. Such operation shall include the delivery and storage of hydmgen tube trailers as set forth in Section 8 hereof, distributing hydrogen fuel through the hydrogen supply line, dispensing hydrogen fuel, maintenance of the hydrogen fuel compressor and dispenser equipment, and the issuance and administration of Dispensing Station customer/patron accounts and all customer interface for such operations. For purposes of this Agreement, such operation shall not include use of the Hydrogen Energy and Supply Station to generate hydrogen. 097525.1 6. Regulations. Licensee shall obtain, at its sole cost and expense, all governmental permits and authorizations; of whatever nature required by any governmental agencies having jurisdiction over Licensee's use of the Premises. Licensee,at its sole cost,will comply with all applicable governmental laws and regulations. Licensee will also comply with any and all reasonable rules and regulations promulgated from time to time by Licensor. 7. Meetings. Prior to exercising any of the rights granted by this Agreement, Licensee's contract administrator or his/her designee shall attend a kickoff meeting(at Licensee's discretion via telephone)with Licensoes staff to discuss operation of the Dispensing Station on the Premises. After commencing operations at the Premises, and thereafter for the term of this Agreemem, Licensee's contract administrator or his/her designee shall attend a monthly meeting via telephone with Licensors staff to discuss Licensee's operation of the Dispensing Station. 8. Delivery and Storage of Hydrogen Tube Trailers AN drivers delivering hydrogen tube trailers to the Dispensing Station must check in and check out _... . _with.the.OCSD.Control.Center, and must provide my delivery information and complete all paperwork required by Licensor. Hydrogen tube trailers may only be stored in the area designated for hydrogen supply trailer parking in Exhibit "A". Once positioned onsite, the trailer wheels must be secured with wheel locks. 9. Protective Barrier. Prior to the first tube trailer delivery and within thirty (30) days following the Effective Date, Licensee shall install, at its sole cost and expense, and of commercial quality, a K-Rail barricade and chain link gate enclosure at the Hydrogen Energy and Supply Station as depicted in Exhibit "A" 10. Records. Licensee shall keep complete,accurate, and detailed accounts of all costs, expenses, expenditures, and income pertaining in any way to its operation of the Dispensing Station. Licensor shall have full and free access to such records at all reasonable times, including the right to inspect, copy, audit,and make records and transcripts from such records. 11. Condition and Maintenance of Premises. Licensee accepts the Premises in an "as is" condition. Licensor expressly disclaims any warranty or representation with regard to the condition, safety, security or suitability for Licensee's intended use of the Premises. Licensee shall maintain the Premises in a neat, clean,orderly and safe condition and shall be responsible for any damage done in or to the Premises caused by Licensee or its employees,agents or contractors. Licensee shall implement and enforce all laws, regulations, controls, or measures imposed by any and all public, administrative and/or regulatory bodies having jurisdiction over Licensee's use of the Premises. Upon temrination of this License, Licensee shall peaceably surrender and quit, and rw^zs i repair and restore the Premises to the same condition as existed on the Effective Date,reasonable wear and tear excepted only. 12. Indemnity. Each Party (an "indemnitor") shall defend, indemnify and hold harmless the other Party(the"Indemnitee")for all claims,damages,expenses, losses, costs or liabilities, including without limitation reasonable legal costs, fees and expenses (collectively, "Losses"h arising out of bodily injuries, including without limitation fatal injury or disease, to the Indemnitor's Group (as defined below) or (2) damage to tangible real or personal property of Indemnitor and Indemnitor's Group, in in either case arising from or in connection with the performance of this Agreement. The obligation to indemnify, defend and hold harmless shall apply without regard to fault or cause of Losses, including without limitation the negligence or strict liability of Indemnitee. "Indemnitor's Group" shall mean: (i)collectively, with respect to Licensee,Air Products and its affiliates,subsidiaries and subcontrators, and any employee, officer, director or agent of any of the foregoing, and (ii) collectively, with respect to Licensor, OCSD and its affiliates, subsidiaries and subcontractors, and any employee, officer, director, agent or invitee of any of the foregoing. Each Party's obligations pursuant to this Section 12 shall survive expiration or earlier termination of this Agreement 11 Insurance. Without limiting Licensee's liability for indemnification, Licensee agrees to purchase and maintain during the life of this License, all required insurance,and to provide proof of said coverage, in accordance with the OCSD Insurance Requirements attached hereto as Exhibit"B"and incorporated herein. 14. Assignment. Licensee may assign,sublet or otherwise transfer its interest under this Agreement in connection with the lease or sale of all or substantially all of Licensee's business assets associated with this Agreement Licensee may otherwise assign,sublet or transfer its interest under this Agreement only with prior written consent of Licensor,consent shall not be unreasonably withheld. Any other attempted assignment, sublet or transfer made in violation of this provision shall be null and void. is. Relocation Benefits. This Agreement is not intended to convey a property interest but to permit Licensee to use the Premises as provided for herein. Licensee acknowledges the rights granted by State and/or Federal Relocation Assistance Laws and regulations and, notwithstanding any other provision of this Agreement, expressly waives all such past, present and future rights, if any, to which Licensee might otherwise be entitled from Licensor with regard to this Agreement and the business operated on the Premises. Licensee shall not be entitled to relocation assistance, relocation benefits, or compensation for loss of goodwill upon the termination of this License. Licensee hereby knowingly waives all notices of termination that may be required pursuant to twrsxs.t California Government Code section 7260,et.seq.,or any other displacement, acquisition or relocation laws or regulations, and waives all rights such relocation benefits, assistance and/or other compensation of whatever kind or nature. 16. Notices. All notices, consents, submissions for approvals, approvals, requests, demands and other communications provided for in this Agreement shall be in writing and shall be deemed to have been duly given and received if and when personally served or forty-eight(48) hours after being deposited in the United States mail,registered,postage prepaid,addressed to the intended Party at: LICENSOR: OCSD ATTN.:CLERK OF THE BOARD 10844 ELLIS AVENUE FOUNTAIN VALLEY,CA 92708-7018 LICENSEE: AIR PRODUCTS AND CHEMICALS,INC. ATTIC: Corporate Secretary (File 216-176-P) _.. 7201..Hamilton 131vd. _. .. .. Allentown, 1 195-1501 17. Integration This instrument constitutes the entire agreement between the parties hereto, supersedes all previous agreements and understandings, whether oral or written, relating in the subject matter hereof, and may not be changed or modified orally. 18. Choice of Law. This Agreement shall be governed by and construed according to the laws of the State of California without giving effect in its conflicts of law provisions. 19. Authority. The Parties hereto have caused this instrument to be executed by their duly authorized representatives,on the day first above written, intending hereby to be legally bound. [Signatures on Following Page] 1097525.1 IN WITNESS WHEREOF,the Parties have executed and entered into this Agreement as of the daze first written above "Licensor" ORANGE COUNTY SANITATION DISTRICT G eral Manager Date C erk o e l3oand I Date Approved as to Form: General Counsel— "Licensee" AIR PRODUCTS AND CHEMICALS, INC. r By: i Name: Title: �(.U'.+til �(� fin ta, ICW525.1 Exhibit"A" Premises Site Plan and Maps isrsn_i a • r IV Yvi tQifii, t gig, ,"°\+pC S4\`� r} _ ' �/ a' rFt ' ,,�hi�\ v .L a •�'a�T, ki�.,ARFj"F cV • �O� pli a s't.. Am j'... \ � �9�'„• � �'.A} � l&- .`t � •`' � \ti � 4�'"`. ; AYc;>�: �`r � -_ swn uN m.w:wr'aA k' ua o""w'S uxr m#snena•srs•®x - wsa�ennuamuanox.a•wrt �s ORANGE COUNT �= -< SANITATION OISTRI w6wiertEnv# C1001A as J 4-1 1 IZ- L ------T T B E MwWT BLD ORANGE COUNTY SANITATION DISTRI T .�LMAMM C 10 MMA t\ L) ,i- I {. ,�\• ;mow �- , l ; Ir 'I j � �Z . I 1 R _ rrauxnnw.nFn lrrwiw4unxrr� ORANGE COUNTY SANITATION DISTRICT HYCPOB B Euullmo w 01000A �� ___ 4vn a•-uu�msrv, CCMPRE99O EOVIPIA P ENf � BOARD OF DIRECTORS Meeting Date I T0.1 Dir. AGENDA REPORT em Number Item Numbe a Orange County Sanitation District FROM: James D. Herberg, General Manager Originator: Rob Thompson, Director of Engineering SUBJECT: 2015-2016 WET WEATHER FLOW MONITORING SERVICES GENERAL MANAGER'S RECOMMENDATION Authorize a Purchase Order Contract for flow monitoring and rain gauge services using the City of San Jose California Master Consultant Agreement (CPMS 7183), with ADS Environmental Services Commencing November 23, 2015 through June 30, 2016, for a total amount not to exceed $330,000, in accordance with Ordinance OCSD47, Section 2.03(B) Cooperative Purchases. SUMMARY The Orange County Sanitation District (Sanitation District) staff is recommending to conduct a small scale flow monitoring effort this winter season. The proposed effort will consist of the placement of approximately 31 flow monitors to capture wet weather flows. The monitors will be placed in areas upstream of identified capacity projects and in areas that have previously been identified as having high inflow and infiltration rates. According to the National Oceanic and Atmospheric Administration (NOAA), the chances for above normal precipitation rates begins to increase in November 2015 and continues through April 2016, with a high probability of very wet weather starting in January. The ramification of not taking action is a missed opportunity to collect valuable wet weather data. The Sanitation District desires to contract with ADS Environmental Services based on contract pricing, breadth of service offerings (rain gauge information will also be collected to ground truth the radar data), and ability to mobilize the staff and equipment necessary to support this project in a short period of time. PRIOR COMMITTEE/BOARD ACTIONS N/A ADDITIONAL INFORMATION The Collection System Capacity Evaluation Study, PS15-08, is currently in the scoping phase. The preliminary scope of the study consists of updating existing pipe network and population data, calibration of the model to dry weather and wet weather flows, collection system capacity master planning, and training for Sanitation District staff. Page 1 of 2 Two and a half years of flow monitoring data for the entire collection system will be collected as part of the effort beginning in November 2016; however, the scale of this effort precludes the meters from being placed prior to this winter season. CEQA A Notice of Exemption was filed on November 5, 2015. The project is exempt from CEQA pursuant to CEQA's Class 6 Exemption for Information Collection (CEQA Guidelines Section 15306). BUDGET/PURCHASING ORDINANCE COMPLIANCE This request complies with authority levels of the Sanitation District's Purchase Ordinance. This item has been budgeted. (Budget Update FY 2015-16; M-STUDIES, Page A-10) and the project budget is sufficient for the recommended action. ATTACHMENT N/A WS:sa:gc Page 2 of 2 ITEM NO. 5 MINUTES OF THE OPERATIONS COMMITTEE Orange County Sanitation District Wednesday, November 4, 2015, 5:00 p.m. A regular meeting of the Operations Committee was called to order by Committee Chair Withers on Wednesday, November 4, 2015, at 5:02 p.m. in the Administration Building of the Orange County Sanitation District. Director Smith led the Flag Salute. A quorum was declared present, as follows: COMMITTEE MEMBERS PRESENT: STAFF PRESENT: John Withers, Chair Jim Herberg, General Manager David Shawver, Vice-Chair Nick Arhontes, Director of Facility Support Services Lisa Bartlett Celia Chandler, Director of Human Resources Tom Beamish Rob Thompson, Director of Engineering Ellery Deaton Ed Torres, Director of Operations & Maintenance Steve Jones Lorenzo Tyner, Director of Finance & Robert Kiley Administrative Services Richard Murphy Kelly Lore, Clerk of the Board Steve Nagel Jennifer Cabral Fred Smith Mark Esquer Chad Wanks Dean Fisher Mariellen Yarc Norbert Gala John Nielsen, Board Chair Alfredo Garcia Greg Sebourn, Board Vice-Chair Kathy Millea Jeff Mohr COMMITTEE MEMBERS ABSENT: None. OTHERS PRESENT: Brad Hogin, General Counsel Kendra Chandrey, Deputy General Counsel Michael Beverage, Alternate Director YLWD Bob Ooten, Alternate Director, CMSD Adam Hutchinson, OCWD PUBLIC COMMENTS: None. REPORT OF COMMITTEE CHAIR: Committee Chair Withers did not provide a report. 11/04/2015 Opeations Committee Minutes Page 1 of 4 REPORT OF GENERAL MANAGER: General Manager, Jim Herberg stated that Adam Hutchinson, Recharge Planning Managerfrom Orange County Water Districtwill be making a presentation on storm water capture tonight as requested by the Board of Directors at the Strategic Plan Update meeting. CONSENT CALENDAR: 1. APPROVAL OF MINUTES (Clerk of the Board) MOVED. SECONDED. and DULY CARRIED TO: Approve Minutes of the October 7, 2015, Operations Committee Meeting. AYES: Bartlett, Beamish, Kiley, Nagel, Nielsen, Sebourn, Shawver, Smith, F., Withers and Yarc NOES: None ABSTENTIONS: Murphy ABSENT: Deaton, Jones and Wanke 2. MATERIALS TESTING, INSPECTION, AND OTHER GEOTECHNICAL TESTING SERVICES (Rob Thompson) MOVED. SECONDED. and DULY CARRIED TO: Recommend to the Board of Directors to: Approve Amendment No. 1 to the Professional Services Agreement, PSA2013-001,with Sequoia Consultants, Inc., to provide on-call Materials Testing, Inspection, and other Geotechnical Testing Services for Collection System and Treatment Plant projects, for an amount not to exceed $100,000, increasing the total contract amount not to exceed $300,000. AYES: Bartlett, Beamish, Kiley, Murphy, Nagel, Nielsen, Sebourn, Shawver, Smith, F., Withers and Yarc NOES: None ABSTENTIONS: None ABSENT: Deaton, Jones, and Wanke NON-CONSENT CALENDAR: Ed Torres, Director of Operations and Maintenance provided a brief report on Item 3. 3. ADDITIONAL INCREASE TO AGREEMENT J-79-1A FOR CENTRAL GENERATION AUTOMATION/CONTINUOUS EMISSIONS MONITORING SYSTEMS (CEMS) (Ed Torres) MOVED. SECONDED, and DULY CARRIED TO: Recommend to the Board of Directors to: 11/04/2015 Operations Committee Minutes Page 2 of 4 Approve additional maintenance services to a Sole Source Purchase Order Service Agreement, J-79-1A with CEMTEK Environmental for maintenance of the Central Generation Engines continuous emissions monitoring systems, for an additional amount of$104,068, for a new total amount not to exceed $361,568, for the contract period ending November 22, 2017. AYES: Bartlett, Beamish, Kiley, Murphy, Nagel, Nielsen, Sebourn, Shawver, Smith, F., Withers and Yarc NOES: None ABSTENTIONS: None ABSENT: Deaton, Jones, and Wanke Director Deaton arrived at 5:07 p.m. Director Jones arrived at 5:09 p.m. Director Wanke arrived at 5:12 p.m. INFORMATION ITEMS: 4. QUARTERLY ODOR COMPLAINT REPORT (Ed Torres) Mr. Torres provided a brief presentation and an update to the first quarter odor complaint report, and also reported of ongoing issues with nearby Costa Mesa residents and the suggested resolutions proposed. Staff then responded to questions regarding benchmark goals for odor complaints and pipeline settlement monitoring. 5. STORM WATER CAPTURE (Bob Ghirelli) Adam Hutchinson, Recharge Planning Manager at Orange County Water District gave an informative PowerPoint presentation on the importance of storm water to the groundwater supplies of Orange County. He provided a history of the Orange County Water District; surface recharge operations of the dams built; capture statistics; challenges and constraints faced; sediment removal technologies; and preservation efforts. Mr. Hutchinson then fielded questions from the Committee regarding: aquafer levels; technologies/techniques to increase water storage or percolation; usable layman terms to inform residents; percentage of collection of water to Prado Dam; percentage of allowable storage; acre fee for minimum base flow and water rights. DEPARTMENT HEAD REPORTS: Ed Torres, reported on recent El Nino preparedness efforts including: Updated wet weather high flow preparedness plan; emergency preparedness and response training; testing of emergency generators; and verifying critical supplies. 11/04/2015 Operations Committee Minutes Page 3 of 4 OTHER BUSINESS AND COMMUNICATIONS OR SUPPLEMENTAL AGENDA ITEMS, IF ANY: Director Shawver wished everyone Happy Thanksgiving. ADJOURNMENT At 5:42 p.m., Committee Chair Withers declared the meeting adjourned to the next scheduled meeting of Wednesday, December 2, 2015 at 5:00 p.m. Submitted by, Kelly A. Lore Clerk of the Board 11/04/2015 Operations Committee Minutes Page 4 of 4 OPERATIONS COMMITTEE Meeting Date TOBd.of Dir. 11/0 4/15 11/18/15 AGENDA REPORT Item Item Numbe 2 6 Orange County Sanitation District FROM: James D. Herberg, General Manager Originator: Rob Thompson, Director of Engineering SUBJECT: MATERIALS TESTING, INSPECTION, AND OTHER GEOTECHNICAL TESTING SERVICES GENERAL MANAGER'S RECOMMENDATION Approve Amendment No. 1 to the Professional Services Agreement, PSA2013-001, with Sequoia Consultants, Inc. to provide on-call Materials Testing, Inspection, and other Geotechnical Testing Services for Collection System and Treatment Plant projects, for an amount not to exceed $100,000, increasing the total contract amount not to exceed $300,000. SUMMARY In June 2013, the Board approved a contract with Sequoia Consultants, Inc. (Sequoia) to provide on-call Materials Testing, Inspection, and other Geotechnical Testing Services to support the ongoing CIP construction efforts. This procurement resulted in an award to a panel of three companies to provide these services and was a competitive selection process. The contracts were awarded for a three-year term not to exceed $200,000 for each of the three firms. Unit rates were locked in at that time. These on-call materials testing, inspection and geotechnical testing service contracts augment our construction management staff to provide laboratory testing and certified sampling of construction materials and soils to ensure projects are constructed to comply with specified standards. The contract amounts for the on-call support contracts are determined based upon future project information known at the time and forecasting the anticipated level of effort to support the projects. With the amount of construction and oversight needed for quality assurance over the last two-year period, especially with the demanding geotechnical needs of the newly installed pipelines in Newport Beach, the originally estimated contract amount to complete the contact term are insufficient. Based upon a revised forecast of the construction through June 2016, an Amendment in the amount of $100,000 is needed to provide the testing and inspection services required to support this work. A new Request for Proposal for the on-call testing and inspection services will be advertised over the next few months resulting in new contracts being recommended for approval to the Board early next year in order to have these take effect in July 2016 for a new three-year term. Page 1 d 2 PRIOR COMMITTEE/BOARD ACTIONS July 2015 - Approved Amendment No. 1 to the Professional Services Agreement, PSA2013-001, with Koury Engineering & Testing, Inc., for an amount not to exceed $125,000, increasing the total contract amount not to exceed $325,000. June 2013 - Approved Professional Services Agreements to provide on-call Materials Testing, Inspection, and other Geotechnical Testing Services for Collection System and Treatment Plant projects, PSA2013-001, for a three-year period effective July 1, 2013, for an amount not to exceed $200,000 per individual agreement ($600,000 total) with the following three firms: Koury Engineering & Testing, Inc.; Sequoia Consultants, Inc.; and AMEC Environment & Infrastructure, Inc. ADDITIONAL INFORMATION N/A CEQA N/A BUDGET/PURCHASING ORDINANCE COMPLIANCE These Professional Services Agreements comply with the authority levels of the Sanitation District's Purchasing Ordinance OCSD-47. These funds are included in the individual project budgets that require these services. Date of Approval Contract Amount Contineencv 06/26/13 $200,000 N/A 11/18/15 $100,000 N/A $300,000 ATTACHMENT The following attachment(s) may be viewed on-line at the OCSD website (www.ocsd.com) with the complete agenda package: Amendment No. 1 RT:DF:dm:gc Page 2 d 2 AMENDMENT NO. 1 TO PROFESSIONAL SERVICES AGREEMENT PSA2013-001 Sequoia Consultants, Inc. THIS AMENDMENT No. 1 to the PROFESSIONAL SERVICES AGREEMENT PSA2013-001 ("Amendment"), is entered into and made effective this 18' day of November, 2015, by and between the ORANGE COUNTY SANITATION DISTRICT, hereinafter referred to as "SANITATION DISTRICT", and SEQUOIA CONSULTANTS, INC., hereinafter referred to as "CONSULTANT". WITNESSETH: WHEREAS, the SANITATION DISTRICT and CONSULTANT previously entered into the PROFESSIONAL SERVICES AGREEMENT, PSA2013-001 ("Agreement') dated July 1, 2013, whereby CONSULTANT agreed to provide on-call material testing, inspection, and geotechnical services; and, WHEREAS, on June 26, 2013, the Board of Directors of the SANITATION DISTRICT approved the Agreement for a three-year term, in an amount not to exceed $200,000; and WHEREAS, CONSULTANT was selected in accordance with the SANITATION DISTRICT selection policy regarding professional services consistent with SANITATION DISTRICT Resolution No. OCSD 07-04, and the SANITATION DISTRICT has determined that CONSULTANT is qualified and competent to provide the necessary services in connection with any specific project for which the CONSULTANT is given a Task Order by SANITATION DISTRICT; and WHEREAS,on November 18,2015,the Board of Directors of the SANITATION DISTRICT approved an increase of $100,000.00 for a total compensation amount not to exceed $300,000.00, with no other changes to the existing Agreement; and Amendment No. 1 PSA2013-001 SEQUOIA CONSULTANTS, INC. Page 1 of 3 WHEREAS, CONSULTANT has agreed to an increase of $100,000.00 for a total compensation amount not to exceed $300,000.00 with no other changes to the Agreement. NOW, THEREFORE, in consideration of the promises and mutual benefits, which will result to the parties in carrying out the terms of this Amendment No. 1, it is mutually agreed as follows: 1. The Agreement is hereby amended to increase the total compensation by$100,000.00 for a total not to exceed amount of$300,000.00. 2. This Amendment No. 1 is supplemental to the Agreement, and is by reference made a part of said Agreement. All of the terms, conditions and provisions thereof, unless specifically modified herein, shall continue in full force and effect. 3. In the event of any conflict or inconsistency between the provisions of this Amendment No. 1 and any of the provisions of the original Agreement, the provisions of this Amendment No. 1 shall in all respects govern and control. [SIGNATURES ON THE FOLLOWING PAGE] Amendment No. 1 PSA2013-001 SEQUOIA CONSULTANTS, INC. Page 2 of 3 IN WITNESS WHEREOF, this Amendment No. 1 to the Agreement has been executed in the name of the SANITATION DISTRICT by its officers thereunto duly authorized and executed by CONSULTANT as of the day and year first above written. CONSULTANT: SEQUOIA CONSULTANTS, INC. By Date Printed Name &Title ORANGE COUNTY SANITATION DISTRICT By Chair, Board of Directors Date By Kelly A. Lore Date Clerk of the Board By Marc Dubois Date Contracts, Purchasing and Materials Management Division Manager CDA:LDR:yp Amendment No. 1 PSA2013-001 SEQUOIA CONSULTANTS, INC. Page 3 of 3 OPERATIONS COMMITTEE Meeting Dale TOBd a/1D11. 11/04/15 lids/15 AGENDA REPORT Item Number Item Nu bar 3 Orange County Sanitation District FROM: James D. Herberg, General Manager Originator: Ed Torres, Director of Operations & Maintenance SUBJECT: ADDITIONAL SERVICES AND INCREASE TO AGREEMENT J-79-1A FOR CENTRAL GENERATION AUTOMATION/CONTINUOUS EMISSIONS MONITORING SYSTEMS (CEMS) GENERAL MANAGER'S RECOMMENDATION Approve additional maintenance services to a Sole Source Purchase Order Service Agreement, J-79-1A with CEMTEK Environmental for maintenance of the Central Generation Engines continuous emissions monitoring systems, for an additional amount of $104,068, for a new total amount not to exceed $361,568, for the contract period ending November 22, 2017. SUMMARY Eight (8) Continuous Emission Monitoring Systems (CEMS) units monitor the exhaust gases of each operational central generation engine as required by permits from the South Coast Air Quality Management District (SCAQMD). The CEMS units and supporting Data Acquisition and Handling Software (DAHS) were procured from CEMTEK Environmental. The CEMTEK Environmental has been successfully servicing and maintaining the existing units, and providing calibration verification reports to SCAQMD since 2008. To comply with the SCAQMD Rule 1110.2 for stationary engines, new emission control equipment is being installed under project J-111 that includes eight (8) additional CEMTEK sampling points for continuous emissions monitoring. Since CEMTEK is the sole service provider of the equipment and is familiar with the original computer code and programing, staff recommends that the contract for maintenance and reporting services be expanded to cover the additional equipment being installed under the capital improvement program. This will help ensure reliability, regulatory compliance, and continued support. PRIOR COMMITTEE/BOARD ACTIONS October 2012 — Approval of Contract No. J-79-A renewal, Continuous Emissions Monitoring System (GEMS). The renewal of a Sole Source Service Agreement with CEMTEK Environmental was awarded for a total amount of $257,500 for a five-year period. September 2008 — Approval of Contract No. J-79-lA awarded to Morrow Meadows for Continuous Emissions Monitoring System (GEMS). The original maintenance contract was awarded as part of the project that installed the CEMS. Page 1 of 2 February 2005 — Approval of Professional Design Services Agreement with Black & Veatch Corporation to prepare plans and specifications for the Central Generation Automation, Project No. J-79-1. ADDITIONAL INFORMATION During Contract No. J-79-1A, the project that installed the CEMS, the District's standard for Modicon PLC equipment was enforced. The Modicon PLCs require custom code to be written by CEMTEK that is held to be proprietary to them. Maintenance or capital projects involving changes to the code require their involvement. CEQA N/A BUDGET / PURCHASING ORDINANCE COMPLIANCE This request complies with authority levels of the Sanitation District's Purchasing Ordinance OCSD-47. This item has been budgeted for FY 2015-17. Date of ADDroval Contract Amount Contingency 10/24/12 $257,500.00 10 10/28/15 $104,068.00 0 $361,568.00 ATTACHMENT The following attachment(s) may be viewed on-line at the OCSD website (www.ocsd.com) with the complete agenda package: • CEMTEK Quotation and Scope of Work Page 2 of 2 CEMTEK Quotation and Arpo�C�EMTE�K Eirvironmental Scope Of Work 3041 South Orange Avenue, Santa Ana, CA 92707 888-400-0200 For questions, please contact Leanne Verbeck at Iverbeck@cemteks.com or 714-437-7100 ext. 223 or Tom Kulesza at tkulesza@cemteks.com or 714-437-7100 ext. 280. Date: July 14, 2015 Quote No: OCSD1507014 To: Orange County Sanitation District (OCSD) Attn: Lisa Rothbart Rothbart@ocsd.com Re: Inlet CEMS Maintenance at OCSD Item # Quotation Description Price 1 Cemtek will provide monthly/quarterly CEMS maintenance on two (2) Inlet CEMS at OCSD which are expected to come on-line by December 2015. The scope of maintenance will mirror the existing all-inclusive maintenance contract for the Stack CEMS that is currently in place for OCSD's Plant 1 and Plant 2 from August 1. 2015 thru December 31. 2015. $ 5,360 2 Cemtek will provide monthly/quarterly CEMS maintenance on eight (8) Inlet CEMS at OCSD which are expected to come on- line by January 2016. The scope of maintenance will mirror the existing all-inclusive maintenance contract for the Stack CEMS that is currently in place for OCSD's Plant 1 and Plant 2 from January 1, 2016 thru December 31, 2016. $ 51,500 3 Cemtek will provide monthly/quarterly CEMS maintenance on eight (8) Inlet CEMS at OCSD. The scope of maintenance will mirror the existing all-inclusive maintenance contract for the Stack CEMS that is currently in place for OCSD's Plant 1 and Plant 2 from January 1, 2017 thru November 22, 2017. $ 47,208 Total Inlet CEMS Support: $ 104,068 Page 1 of 7 CEMTEK Environmental Continuous Emission Monitoring Systems CEM Systems, CEM Service, Opacity, Flow and CEMS Parts CEMTEK Environmental Inc. QUOTATION www.cemteks.com 3041 S. Orange Avenue NO: 080212 Rev4 Santa Ana, CA 92707 Tel 714-437-7100 Fax 714-437-7177 CEMS Parts Order Line 1-888-400-0200 Date: Sep 17, 2012 To: Orange County Sanitation District Attention: Don Van Voorst Phone: 714-593-7624 REF: Quotation for Five(5)Years CEMS Maintenance Contract Item# Quotation Description Total Price Quote for Five (5) Years CEMS Maintenance Contract I Renewal of current CEMS contract for Orange County Sanitation District,maintaining existing scope of work, for a one (1)year period. November 23, 2012 thin November 22, 2013. (This renewal includes PLC and DABS maintenance for the same period) $51,500 2 Four(4) optional renewal years @ $51,500 per year $206,000 Total: $257 500 If you have any questions,please feel free to phone Brenda Hoogstraten at 714-437-7100 ext. 224 or our Field Service Manager, Kevin Tierney, at 714-437-7100 ext. 238. Bid valid for 30 days from date of issue. Payment terms: Bill monthly Net 30 days Terms& Conditions will not change with contract renewal. They will remain the same as negotiated under Project J-79-1A 3041 S.Orange Avenue,Santa Ana, CA 92707•Phone:714437-7100•Fax 714-437-7177 2013 S.Wood Avenue,Linden,N107036 •Phone:908-474-9630 0 Fax:908-474-9413 AGREEMENT J-79-IA CENTRAL GENERATION AUTOMATION/ CONTINUOUS EMISSIONS MONITORING SYSTEMS (CEMS) This AGREEMENT,between CEMTEK Environmental(CEMTEK)and the Orange County Sanitation District(OCSD), is the prepaid"Maintenance Contract"established in Job J-79-1A with the Morrow-Meadows Corporation and assigned to the OCSD. The scope of Services is outlined in the Project J-79-IA Specification Section 17200.1.8(See Attachment A—excerpt from J-79-1A Specification)and further delineated herein. The equipment and associated appurtenances,which were provided in Project J-79-1A and are subject to this Maintenance Contract, include the following: 1. Plant 1:Unit 1 —16BFCP755A,Unit 2— 16CFCP755A,and Unit 3— 16DFCP755A 2. Plant 2:Unit 1 —26BFCP753A,Unit 2-26CFCP753A,Unit 3 -26DFCP753A,Unit 4— 26EFCP753A, and Unit 5—26FFCP753A Commencement and Completion of Maintenance Contract The term of this Maintenance Contract is three(3)years commencing November 22,2009 ending November 21,2012. Scope of Work—CEMS Maintenance Services for OCSD On-site Maintenance CEMTEK shall provide all required repairs and servicing as described in Project J-79-IA Specification 17200.1.8 CEMTEK shall make every effort to notify OCSD one(1)week prior to mobilizing to site for any scheduled maintenance visits. For each CEMS under this Maintenance Contract,the following audits and maintenance activities are provided as applicable and at the frequencies normally required: The OCSD Quality Assurance Plan (QAP) document is the controlling document for scheduled preventative maintenance activities and records. CEMTEK shall perform a total of thirty six(36) monthly maintenance services as detailed in the OCSD QAP which includes but is not limited to the following: a) Complete inspection to verify proper operation of entire system b) Perform leak checks on each system component c) Replace sample probe filters as required(CEMTEK to perform required tests if filters are replaced with non-identical filters) !, d) Replace sample conditioning filters as required e) Replace analyzer filters as required t) Rebuild analyzer sample pumps according to manufacturer's recommendation g) Rebuild sample transport pumps according to manufacturer's recommendation h) Verify zero air generator for proper operation i) Replace zero air generator filters/chemicals as required j) Perform manual calibrations as required k) Complete analyzer maintenance checklists 1) Perform flow monitor flow and leak checks Page 1 of 6 CEMTEK Environmental J-79-IA-Prepaid Maintenance Contract m) Inspect and verify proper operation of HVAC Systems located on top of each CEMS units and perform any maintenance as needed n) Inspect and verify proper operation of Air Clean up Panels in the CEMS and perform any maintenance as needed - o) Document and submit maintenance service visit reports CEMTEK shall perform a total of twelve (12) quarterly maintenance services as detailed in OCSD's QAP in addition to the scheduled monthly maintenance. In Six(6)of these twelve(12)quarterly maintenance service visits,CEMTEK shall also perform semi-annual maintenance activities as detailed in OCSD's QAP and in addition shall perform the following: a) Check and replace instrument air filters as needed b) Check calibration of the pressure and temperature transducers CEMTEK shall perform a total of three(3)annual maintenance services as detailed in OCSD's QAP and in addition shall perform the following: a) Attend annual safety meetings conducted by the OCSD b) Submit annual safety plan c) Provide annual certificate of insurance covering CEMTEK staff working on District premises d) Monthly maintenance e) Quarterly maintenance OCED(District Rupansibilities)Daily and weekly- - a) Verify all daily CEMS calibrations Verify that all CEMS have passed the daily automatic calibration checks by visually checking the daily calibration results.The calibration results can be found on the DAS calibration summary report or can be viewed on the DAS calibration control screen.Also the DAS alarms screen should be checked for any calibration fail or system alarms. b) System inspection and daily log Complete the daily check lists found in the QAP for each CEMS. ', c) Manual calibrations if required If any analyzer has drifted out of calibration tolerance(From step a)manually perform calibration and manually adjust analyzers as required.(Perform automatic(hands off) calibration after any adjustments have been made). i I, d) Manual adjustments of sample flow,pressure and vacuum Adjust BPR or flow meters to bring sample system pressures and/or flows to within set point tolerances as found in the QAP. Please note: The above listed"District Responsibilities"are based on requirements from the SCAQMD. I Should the SCAQMD change their requirements at any time,the above listed responsibilities may be affected. Training on the above listed items was provided as per CEMTEK's training submittal dated March 2009. j Page 2 of 6 i CEMTEK Environmental J-79-IA-Prepaid Maintenance contract ' Consumable& Repair Parts Cemtek shall supply all consumable parts for three(3)years. Cemtek shall be responsible to supply all repair parts necessary for the conductance of all repairs or equipment malfunction for three(3)years. At the end of the three(3)year maintenance contract, CEMTEK shall replenish the OCSD inventory per Section 1.7 of the Specification. Calibration Test Gases OCSD shall supply all calibration gases required to perform quarterly cylinder gas audits and daily calibrations. Repair Services i CEMTEK shall respond to a repair request within 48 hours or less of notification by the OCSD. CEMTEK shall provide phone support to a site representative in an effort to identify the problem or dispatch a CEMTEK service engineer to the site to resolve the stated problem.Contact numbers for repair service shall be supplied upon award of contract. Pre-paid repair service includes identification of the problem and repair of the equipment as required. CEMTEK shall conduct arty required testing triggered by CEMTEK performed activities under this Maintenance Contract per the QAP. Reporting Services CGA Reporting CEMTEK shall generate quarterly reports for submittal to State and local agencies for OCSD. The OCSD will be required to work with CEMTEK in the generation of such reports,providing requested documentation in a timely manner so that the report deadlines may be met Providing monitor downtime explanations and missing datajusfrfications will be the responsibility of the OCSD. OCSD shall be responsible for identifying a primary and secondary contact person for resolving all reporting and contract issues.All reporting issues or concerns identified by CEMTEK will be directed to the OCSD's designated contacts,capable of confirming plant operation and CEMS hardware maintenance activities. Daily/Weekly DAHS Monitoring CEMTEK shall access the DAHS on a weekday basis to identify potential problems with the CEM hardware and to check the validity of previous days data- The OCSD will be required to provide CEMTEK with one point of contact for resolving all identified issues.Activities performed by CEMTEK with this service include: a. Data Validation Review b. Calibration Review c. Alarm Review j d. Exceedance Coding and Notification e. Monitor Downtime Coding j Page 3 of 6 CEMTEK Environmental J-794A-Prepaid Maintenance Contract Engineering Services On-She Annual Engineering Configuration Review CEMTEK shall provide a total of three(3)on-site visits for engineering support with loading major software releases,implementing configuration changes,review of regulatory requirements,system inspection,disk clean-up,review of displays and alarms,and other related services.The OCSD shall be required to provide CEMTEK with a single point of contact while the services are performed on-site.The number of days allotted for this service shall be 1 day for each site-Plant 1 and Plant 2. CEMTEK shalt be performing these annual on-site visits. Regulatory Services j Annual Regulatory Consultation Annually,CEMTEK shall provide 10 hours of consultation on regulatory issues pertaining to EPA 40CFR60,SCAQMD Rule 1110.2,Rule 218,and Rule 218.1.Consultation includes discussion of issues via telephone and electronic mail,and provision of discussion papers. Annual QA/QC Review CEMTEK shall conduct an annual review of the OCSD's quality assurance/quality control plan.Upon completion of the review,CEMTEK will generate a report documenting the plan's compliance with current EPA/SCAQMD regulations or,should areas not be compliant,the report will detail areas where the plan is deficient and must be reviewed. If any discrepancies are discovered between the QA/QC control plan and current EPA/SCAQMD regulations,it will be the OCSD's responsibility to provide their current QA/QC control plan to CEMTEK and my additional information necessary to conduct this review. i j Page 4 of 6 � CEMTEK Environmental J-79-IA-Prepaid M.inte...ce Cgntratt ATTACHMENT A (Excerpt from J-79-IA Specifications) 1.8 MAINTENANCECONTRACT A. The CEMSS shall prOWdO In its bid a three year maintenance cOhmsct which is dbeally p assignable to the OHtrl 1, M accordance wIN stem,define hareln. and as NpacMad In the Sepb aMbaca i Provisions. The mpn cone. than n begin upo otice of Final Completion of We project and continua In full force and meal M three yeare hall the Mate of We Notice of Final Complellon. The maintenance onfraot shall include, but not limited to the adopt o1 SN .— co oWined hweln. antl tie enedfled in she Spacial F—Blons, B. Provide periodic maintenance as Indicated Wbw and in accordance wltn aqulpment vendors recommendation, G. Fmvlea all requlead repaUe and O.1cle, O1 the equipmarR Supply replanamaeH for all fails dabNva apulpmant antl materials. Replaoantant equlpnwnMnetarial OCS . All aqpmant foilures shall beerreposedd q and euip t me ,ent ratud To I.O ul wltnln 9e hours of notlnullon by the OCSO or dot Oh by the GEMS Euppllac CONTINUOUS EMISSIONS MONITORING SYSTEM JOB NO.J-7e-1 JOB NO,J-70-1 LCEMS) CcW TRAlCTJ.ya•1A 17200-10 APRIL led, O. Provide meintenenca of an CEM OAHS and CEM networking software. Thl. shall Include all aeihvare upgrade. to co mot any danciCndCa Or anru ncementa In the ld, wi ee and any change.to raguleanna thn arts rpuVerl for compliance within the maintenance parted, E. Furnish all consumable pans, material, and labor. Calibration pas will be,furnished by the OCSO. F. Mimtaln a comprahanaN. sperm parts Inwnlary. 0. Supply all labor and labor Opals. Including travel and living expenses. H. -Schedule with sib personnel su(fidant training eS.I... to cover ail .spade Of aquipm ed,operation, maintenance, regulatory and rop ar 1. Implement and malmaln a peeventiva maintenance program. Including aqulpment dtaning. lubrication. raoondltloning, adjustment. and testing TO prevent failure o1 monitoring system components and minimize the potential of major malfunction. J. Maintain a maintenance log book at see t site, accessible by the OCSO, to provide card Of all malmenance performance on each sample system. As malfunction. Occur, the date, nature Of mallunotbn, Corrective action. and any Comments shall be,®cordOd. Pravantive maintenance aetivines shall also bi,recorded. hC Perlorrn the quarterly cylinder gas audit as mqulred by the specified regulations, Performance win Include supply to We OCSO of is fable Of ...R. and the immediate correction of any daflasncles. L. Attend annual safety Training .ton conducted by lhs O=SO. Fell. ail OCSO antl Cal OSHA safety procedures required by the m imanue ce ao,efti.s. Submit en annual aa(aly Plen for approval say OCSO which Includes saint,procedures and Insurance CartfNCates for worker compenaatbn, public and Ouse liability. I Page 5 of 6 i CEMTEK Environmental J-79-IA-Prepaid Maintenance Contract CEMTEK Env' 0amen ll,Inc. Orange County Sanitation District By: i' By: (Signature) (Signature) Name: Kevin Tierney Name: (rYpe or Print) (Type or Print) Title: Field Service Ma agar Title: lS ZpiO (Date Execute (Date Executed) CEMTEK Environments nc. Orange County Sanitation District By: By: ( sly ) (Signature) ' Name: Keith Crabbe Name: (Type or Print) (Type or Print) Title: Engi'neeeering Manager Title: '-/ �i� ZOI� (Date -Executed) I (Date Executed) CEMTEK Environmental,Inc. Orange County Sanitation Distrito (Signature) ' " (Signature) Name: Dan Oquendo Name: (Type or Print) (Type or Prinu Tide: Project Engineer Title: (Dolt Exeeukd) (D.W Executed) i i i Page 6 of 6 ADMINISTRATION COMMITTEE Meeting Date TOBE.Or .Dir. 11/12/15 11/18/15 AGENDA REPORT ItemNumber Item Number z B Orange County Sanitation District FROM: James D. Herberg, General Manager Originator: Lorenzo Tyner, Director of Finance and Administrative Services SUBJECT: VAX EMULATOR FOR PROCESS CONTROL SYSTEM, MODERNIZATION & SECURITY IMPROVEMENTS PROJECT GENERAL MANAGER'S RECOMMENDATION A. Authorize a Purchase Order Contract with Quayle Consulting, Inc. for the procurement of Charon-VAX permanent licenses and maintenance in the amount not to exceed $338,401; and B. Approve a contingency of 10% ($33,840). SUMMARY The Operations and Maintenance Department utilizes Supervisory Control and Data Acquisition (SCADA) systems to provide real-time plant monitoring, automation, alarming and control of treatment processes. SCADA is a highly complex mission critical hardware and software system used to monitor and control the day-to-day operations of the treatment plants and outlying pump stations. Additional Charon VAX software licenses are needed to support the integration of the process control software that are being developed for CIP projects and for adding additional SCADA workstations for staff to better monitor the plants and treatment systems. The software licenses are exclusively distributed through Quale Consulting, Inc. Additional Charon VAX licenses will be procured to support projects and the existing SCADA systems as follows: • A pair of SCADA servers will be added to support the integration of the Sludge Dewatering and Odor Control project at Plant No. 1 (Job No. P1-101), currently in construction. • A pair of SCADA servers will be added to support the integration of a future project, the SCADA System and Network Upgrade project at Plant No. 2 (Job No. P2-107). • Additional SCADA proxy servers will be added to support additional workstations, for current and future projects, that will be added to make the SCADA systems more readily available to staff for better monitoring of the plant treatment processes and pump stations. Page 1 of 3 PRIOR COMMITTEE/BOARD ACTIONS In 2011 - Established the Charon-VAX emulator software product as Orange County Sanitation District's standard for VAX emulators. In 2011 - Awarded a contract to purchase Charon-VAX permanent licenses under Specification No. S-2011-504 for an amount not to exceed $292,217. ADDITIONAL INFORMATION The SCADA system that OCSD utilizes for automation and control of plant treatment processes and collection systems runs on specialized software. Previously, the SCADA software ran on obsolete DEC workstations and servers using the VAX/VMS operating system which were no longer produced; OCSD has addressed the hardware obsolescence issue in 2011 and replaced the obsolete DEC hardware servers and SCADA workstations with of-the-shelf servers and workstations with the use of the CHARON-VAX emulator software. The Charon VAX emulator software application enabled OCSD to preserve the existing SCADA application software and emulate the SCADA software on modern computer equipment. In February 2010, Operations and Maintenance commissioned a study to recommend a solution that will address SCADA server hardware obsolescence. The 'VAX Emulation Product Study" was performed by DLT&V Systems Engineering and recommended the Charon-VAX product. Based on this study, sole source procurements for software licenses were awarded through the CIP process to Quayle Consulting. The software was tested in the commissioning and start-up of the new Plant No. 2 Headworks Replacement Project (Job No. P2-66). The test was successful and additional licenses, servers and workstations were procured to replace the Plant No. 1, Plant No. 2 and Pump Station SCADA systems. Below is a summary of the major procurements of the Charon-VAX licenses in support of the SCADA systems: • Six licenses were procured to support the replacement of obsolete SCADA server hardware. • Two licenses were procured to support the treatment processes installed by the Plant No. 1 Activated Sludge Facility No. 2 project (Job No. P1-102). • Two licenses were procured to support the Solids Thickening and Processing Upgrades at Plant 2 (Job No. P2-89). • Two licenses were procured to support the Electrical SCADA systems added by the Power Monitoring Control system project (Job No. J-33-3). • Ten proxy server licenses were procured to support the replacement of approximately 100 obsolete SCADA workstations for the Plant No. 1, Plant No. 2 and Pump Station SCADA systems. Page 2 of 3 CEQA N/A BUDGET / PURCHASING ORDINANCE COMPLIANCE This request complies with authority levels of the Sanitation District's Purchasing Ordinance. The requested items have been budgeted as follows: • Budget Update FY 2015-16, Section A-20, Capital Equipment Budget detail under Information Technology • Budget Update FY 2015-16, Section A-10, under Project No. P1-101 • Budget Update FY 2015-16, Section A-9, under Project No. P2-107, future projects ATTACHMENT N/A Page 3 of 3 ADMINISTRATION COMMITTEE Meeting Date TOBE.Or .Dir. 11/12/15 11/18/15 AGENDA REPORT Item Item Number 3 9 Orange County Sanitation District FROM: James D. Herberg, General Manager Originator: Lorenzo Tyner, Director of Finance and Administrative Services SUBJECT: MICROSOFT ENTERPRISE LICENSE AGREEMENT (ELA)for MICROSOFT ENTERPRISE SOFTWARE LICENSES GENERAL MANAGER'S RECOMMENDATION A. Authorize a Purchase Order with a three-year contract to purchase Microsoft Enterprise licenses under the Microsoft ELA in accordance with Microsoft Volume Enterprise Enrollment—for State and Local government, Riverside County Master Licensing Agreement 01 E73134, payable annually and with contract expiration date of December 31, 2018 for a total amount not to exceed $874,556.22; and B. Approve a contingency of 15% ($131,183.43). SUMMARY OCSD invests in technology to efficiently and economically support OCSD's mission and vision. Each year, plant design and operations become more complex due to changing needs as well as more stringent state and federal regulations and increased risk from security threats. These changes drive an increase in the use of technologies. OCSD's Information Technology division utilizes Microsoft products to run various systems of the plant. These products are under the Microsoft ELA, a volume licensing program for government, education, healthcare, and nonprofit organizations that offer flexible and affordable solutions tailored by organization size and purchasing preference while providing access to technology. Availing of the Microsoft ELA ensures that OCSD receives the best pricing on software purchases and subscriptions while remaining compliant with software license agreements and copyright law. Other benefits include access to the latest versions of software as they are released and centralized license management. The MS ELA includes Windows, MS Office, Server, database, and system management software. By bundling these packages, OCSD receives the lowest possible costs and benefits from a wide range of productivity and system management tools. Staff is requesting contingency of 15% to cover any additional Microsoft licensing during this three-year contract. Page 1 of 2 PRIOR COMMITTEE/BOARD ACTIONS N/A ADDITIONAL INFORMATION OCSD is adding Disaster Recovery/Business Continuity and additional security software licensing to this agreement. The Master Agreement allows yearly additions to the base contract. In the event additional licensing is required during the term of this agreement, the requested contingency funds will be used. CEQA N/A BUDGET / PURCHASING ORDINANCE COMPLIANCE This request complies with authority levels of the Sanitation District's Purchasing Ordinance. The items purchased through the process are budgeted in the yearly Joint Operating Budget. ATTACHMENT The following attachment(s) may be viewed on-line at the OCSD website (www.ocsd.coml with the complete agenda package: Insight MS EA Quote Request Page 2 of 2 Microsoft Enterprise Agreement Date 10/20/2015 ECS + G4 Step Up- Including Yr 3 TU +Visio& Project On Prem Issued Quantity Part# Description Unit Price Ext. Price Subscriptions 640 AAA-11984 EntCloudSuiteGovFromSA ShrdSvr ALNG SubsVL MVL PerUsr $249.96 $ 159,974.40 640 U9S-00019 O365GovE4 ShrdSvr ALNG SU MVL O365GovE3 PerUsr $21.48 $ 13 747.20 1 J51-1-00004 AzureMntryCmmtmntG ShrdSvr ALNG SubsVL MVL Commit 0 $ Provision Additonal Products $ 6 MX3-00117 VSEntwMSDN ALNG [SAI MVL $979.46 $ 5,876.76 2 77D-00111 VSProwMSDN ALNG [SAI MVL $280.50 $ 561.00 2 395-02504 Exch SvrEnt ALNG ISAI MVL $605.06 $ 1,210.12 6 312-02257 Exch SvrStd ALNG rSAJ MVL $105.67 $ 634.62 3 5HU-00216 Sf6Svr ALNG SA MVL $544.57 $ 1,633.71 3 H04-00268 SharePointSvr ALNG SAI MVL $1015.54 $ 3046.62 12 7JQ-00343 SQLSvrEntCore ALNG SA MVL 2Lic CoreLic $2,053.72 $ 24,644.64 4 7NQ-00292 SQLSvrStdCore ALNG ISAI MVL 21-ic CoreLic $535.58 $ 2,142.32 8 126-00196 V$TeamFndtn$vrCAL ALNG SA MVL UsrCAL $66.60 $ 532.80 150 6VC-01254 WlnRmtDskt SrvcsCAL ALNG [SAJ MVL UsrCAL $19.65 $ 2,947.50 43 YJD-01077 CISStd ALNG SA MVL 2Proc $250.42 $ 10,768.06 33 FUD-00938 CISDataCtr ALNG SA MVL 2Proc $1,214.78 $ 40,087.74 50 076-01912 Prjct ALNG SA MVL $97.57 $ 4878.50 5 H30-00238 Pr'ctPro ALNG SA MVL wl Pr'ctSvrCAL $162.62 $ 813.10 15 D87-01159 VisioPm ALNG [SAI MVL $83.47 $ 1,252.05 150 D86-01253 VisioStd ALNG SA MVL $43.18 $ 6,477.00 640 KF5-00002 Offce365 ATP per user $16.08 $ 10291.20 Product-total $291,518.74 Sub-Total Tax $- Shipping No Charge Total Annual Payment $291,518.74 3 Year Total $874 556.22 ADMINISTRATION COMMITTEE Meeting Date TOBE.Or .Dir. 11/12/15 11/18/15 AGENDA REPORT Item Item Number 4 10 Orange County Sanitation District FROM: James D. Herberg, General Manager Originator: Lorenzo Tyner, Director of Finance and Administrative Services SUBJECT: ENTERPRISE INFORMATION MANAGEMENT (EIM) STAFFING SUPPORT GENERAL MANAGER'S RECOMMENDATION A. Authorize a Service Contract with Project Partners, Inc. for Enterprise Information Management On-Call Staffing, Specification No. S-2015-72513D, for a period of January 1, 2016 through December 31, 2016, for a total annual amount not to exceed $121,800 with four one-year renewal options; and B. Approve a contingency of 20% ($24,360). SUMMARY This procurement provides the use of skilled Geographic Information Systems (GIS) Technicians and CAD drafters to Enterprise Information Management's (EIM) CAD and GIS group. EIM group is a division of OCSD's Information Technology Department responsible for facility records management and maintenance. These records include all facility engineering drawings, baseline models in Computer Aided Drafting (CAD) and Geographic Information Systems (GIS) format, specifications, shop drawings, and other project-related documents and data. The EIM group is also responsible for providing technical support in GIS and CAD. Staff is requesting a contingency of 20% due to the number of unplanned work activities that are requested from EIM. One of the primary support functions of EIM is to support the CIP program. Staff resources are allocated based on the schedule of project submittals however, there are many other requests that cannot be planned for and may require extra human resources to complete including field discrepancies, phased CIPs, topographical survey of Treatment Plant No. 1, and sewer transfer support. PRIOR COMMITTEE/BOARD ACTIONS On December 21, 2011 a contract was awarded to Project Partners in the NTE amount of$211,000 with the option to renew for 3 additional one-year periods for on-call GIS and CAD services. Page 1 of 2 ADDITIONAL INFORMATION This procurement was competitively bid with 4 bid packages received. The responsive bids and the bid amounts are listed below. Purchase of Enterprise Information Management (EIM) Staffing Support Bid Date— October 8, 2015 @ 2:00 PM (Pacific) Specification No. S-2015-725BD Bidder Amount of Bid Project Partners, Inc. $121,800.00 International Star $122,400.00 Staff recommends Project Partners, Inc. be awarded a purchase order for providing staff support to EIM CAD and GIS efforts the lowest responsible and responsive bidder. CECIA N/A BUDGET/PURCHASING ORDINANCE COMPLIANCE This request complies with authority levels of the OCSD's Purchasing Ordinance. This item has been budgeted in Capital Improvement Project SP-15 (Geographic Information System). Project contingency funds will be used for this bid. Date of Approval Contract Amount Continaencv 11/18/2015 $121,800 $24,360 ATTACHMENT The following attachment(s) may be viewed on-line at the OCSD website (wwwocsd.corn with the complete agenda package: • Service Contract Page 2 of 2 SERVICES CONTRACT Enterprise Information Management(EIM)Staffing Support 5-2015.725BD THIS CONTRACT is made and entered into, to be effective the date fully executed below by and between ORANGE COUNTY SANITATION DISTRICT having a principal place of business at 10844 Ellis Avenue, Fountain Valley, California, 92708 (hereinafter referred to as "OCSD") and PROJECT PARTNERS, INC. having a principal place of business at 23195 La Cadena Drive, Suite 101, Laguna Hills, CA 92653 (hereinafter referred to as"SERVICE PROVIDER"),collectively referred to as the"Parties". WHEREAS, OCSD desires to retain the services of SERVICE PROVIDER for Enterprise Information(EIM) On-Call Staffing Services as stated in the Scope of Work (attached hereto and incorporated herein by reference as Exhibit"A")"Services"; and WHEREAS, SERVICE PROVIDER represents that it has expertise providing EIM On-Call Staffing services ("Services"). Based on SERVICE PROVIDER's expertise and experience, OCSD wishes to temporarily engage the Services of SERVICE PROVIDER; and WHEREAS, OCSD has chosen SERVICE PROVIDER to conduct Services in accordance with Ordinance No. OCSD-47; and WHEREAS,on November 18,2015,the Board of Directors of OCSD,by minute order,authorized execution of this CONTRACT between OCSD and SERVICE PROVIDER; and NOW THEREFORE, in consideration of the promises and mutual benefits exchanged between the Parties, it is mutually agreed as follows: 1. Engagement of SERVICE PROVIDER a. OCSD hereby engages SERVICE PROVIDER to provide Assigned Employees to perform Services and SERVICE PROVIDER accepts the engagement, and agrees to provide the Assigned Employees to perform Services upon the terms and conditions set forth herein. OCSD agrees that it is responsible for managing the work assigned to the Assigned Employees. Notwithstanding the foregoing, the Assigned Employees shall be employees of SERVICE PROVIDER,and SERVICE PROVIDER shall remain the legal employer of the Assigned Employees placed with OCSD for all purposes, including responsibility for (i) hiring,evaluating,rewarding,terminating or disciplining the Assigned Employees; (ii)paying all federal, state, and local labor and employment taxes; and (Ili)calculation of wages, and unemployment and workers compensation insurance. b. SERVICE PROVIDER, all its employees, officers, independent Service Providers, and/or agents shall only be entitled to the compensation provided for in this CONTRACT and shall not be eligible to receive any other benefits from OCSD. c. SERVICE PROVIDER shall be responsible for providing, at SERVICE PROVIDER's expense,worker's compensation or other insurance as well as all licenses and permits usual or necessary for conducting the Services hereunder. SERVICE PROVIDER hereby indemnifies OCSD for any claims, losses, costs, fees, liabilities, damages or penalties suffered by OCSD arising out of SERVICE PROVIDER's breach of this provision. 2. Assigned Employees a. Assigned Employees are defined as the person or persons employed by the SERVICE PROVIDER and temporarily assigned to OCSD to perform temporary Services as described under this CONTRACT. b. SERVICE PROVIDER shall be responsible for assigning employees as exempt or nonexempt per the Guidelines set by the Federal Government. Exempt employees will not be eligible for overtime nor will their pay be deducted for absences of less than one day. Orange County Sanitation District 1 of 8 Specification No. S-2015-725BD c. OCSD reserves the right to require Assigned Employees to sign an acknowledgement as to their understanding that they are employees of the SERVICE PROVIDER and not of OCSD and that they shall not be entitled to any benefits accorded to those individuals listed on OCSD'S payroll. 3. Work Hours SERVICE PROVIDER's assigned staff will be required to work on site at OCSD's facilities located in Fountain Valley, California. However, at time,fieldwork and/or presentations and meetings may be required at other OCSD facilities or at job site locations away from OCSD. Firm's assigned staff may work up to 8 to 10 hours per day, and up to 4 to 5 days per week. OCSD will only pay for the hours actually worked on site. OCSD does not pay travel time to or from work or time taken for lunch breaks. 4. SERVICE PROVIDER's Representations In the performance of the Services under this CONTRACT, SERVICE PROVIDER shall adhere to the highest fiduciary standards, ethical practices and standards of care and competence. SERVICE PROVIDER agrees to comply with all applicable Federal, State and local laws and regulations. 5. California Department of Industrial Relations(D/R)Rea/strafion and Record of Waves a. To the extent SERVICE PROVIDER's employees and/or SubService Providers who will perform Work during the Contract for which Prevailing Wage Determinations have been issued by the DIR and as more specifically defined under Labor Code Section 1720 at seq, SERVICE PROVIDER and SubService Providers shall comply with the registration requirements of Labor Code Section 1725.5. Pursuant to Labor Code Section 1771.4, the Work is subject to compliance monitoring and enforcement by the DIR. b. The SERVICE PROVIDER and SubService Providers shall maintain accurate payroll records and shall comply with all the provisions of Labor Code Section 1776, and shall submit payroll records to the Labor Commissioner pursuant to Labor Code 1771.4(a)(3). Penalties for non-compliance with the requirements of Section 1776 may be deducted from progress payments per Section 1776. c. Pursuant to Labor Code Section 1776, the SERVICE PROVIDER and SubService Providers shall furnish a copy of all certified payroll records to OCSD and/or general public upon request, provided the public request is made through OCSD, the Division of Apprenticeship Standards or the Division of Labor Enforcement of the Department of Industrial Relations. d. The SERVICE PROVIDER and SubService Provider shall comply with the job site notices posting requirements established by the Labor Commissioner per Title 8, California Code of Regulation Section 16461(e). 6. Billing Rates a. Billing Rates shall be in accordance with the hourly rate as stated in the Bid results(attached hereto and incorporated herein by reference as Exhibit"B".) For purposes of calculating hourly rates, salaries of SERVICE PROVIDER employees performing services under the CONTRACT shall be adjusted annually based on the November CPI of LA-Orange County Index of each year. This rate is from the U.S Department of Labor Statistic, Consumer Price Index — Los Angeles/Orange County Metropolitan Area. The annual salary figures used in calculating hourly rates shall not otherwise be adjusted, regardless of whether any SERVICE PROVIDER employee may have received a salary increase from SERVICE PROVIDER that exceeds the increase in Orange County Sanitation District 2 of 8 Specification No. S-2015-725BD CPI. The first hourly rate escalation will occur January 1, 2017. 7. Invoicing and Payment a. SERVICE PROVIDER shall submit invoices to OCSD'S IT Systems and Operations Manager on a monthly basis for Services performed. SERVICE PROVIDER shall support each invoice with time sheets, approved by OCSD, for Services performed. Invoices shall include the Purchase Order Number and shall be submitted for approval to OCSD at the above-referenced address. After OCSD has approved the invoice, payment will be due within thirty(30) days of receipt of the invoice. b. OCSD shall have fifteen (15) days after the date of invoice receipt to contest in good faith the amounts and items charged. If uncontested amounts remain unpaid for thirty(30)days or more, SERVICE PROVIDER may discontinue Services until such amounts are paid. c. OCSD is required to withhold 7% on all payments made to non-California resident service providers for professional services, rents, leases or royalties paid. Any funds withheld shall be remitted to the California Franchise Tax board on a quarterly basis. Service providers may be exempt from this requirement by their exemption status and submitting the California Form 590 to OCSD's Financial Management Division via regular mail or email to APStaff@ocsd.com. 8. CONTRACT Period a. Services to be provided by SERVICE PROVIDER under this CONTRACT shall commence on January 1, 2016 and run through December 31, 2016. b. OCSD reserves the right to renew this CONTRACT annually for up to four(4)additional one year terms upon approval and written CONTRACT of OCSD and SERVICE PROVIDER. OCSD makes no obligation to extend or renew. All renewals may be exercised through the Amendment or Purchase Order process. 9. Billing Reports SERVICE PROVIDER shall be required to submit a report each month to OCSD'S Manager of the Information Technology that includes Assigned Employee(s) name(s), project number(s), bill rate(s), pay rate(s)and hours worked. 10. Expenses OCSD shall reimburse SERVICE PROVIDER for reasonable out-of-pocket expenses incurred by Assigned Employees required and actually incurred in performing services, provided the SERVICE PROVIDER and/or Assigned Employees have obtained OCSD's prior written approval and submits supporting documentation satisfactory to OCSD. If Assigned Employees are required to travel, they must first obtain SERVICE PROVIDER and OCSD'S written consent.Time spent in local travel to and from home to OCSD'S plant sites shall not be considered time worked and shall not be compensated. 11. Audit Rights SERVICE PROVIDER agrees that,during the term of this CONTRACT and for a period of three(3) years after its termination, OCSD shall have access to and the right to examine any directly pertinent books, documents, and records of SERVICE PROVIDER relating to the invoices submitted by SERVICE PROVIDER pursuant to this CONTRACT. 12. Ownership of Intellectual Property a. SERVICE PROVIDER agrees that all designs, plans, reports, specifications, drawings, schematics,prototypes,models,inventions,and all other information and items made during the course of this CONTRACT and arising from the Services(hereinafter referred to as"New Orange County Sanitation District 3 of 8 Specification No. S-2015-725BD Developments") shall be and are assigned to OCSD as its sole and exclusive property. SERVICE PROVIDER agrees to promptly disclose to OCSD all such New Developments. Upon OCSD'S request,SERVICE PROVIDER agrees to assist OCSD,at OCSD'S expense, to obtain patents or copyrights for such New Developments, including the disclosure of all pertinent information and data with respect thereto, the execution of all applications, specifications, assignments, and all other instruments and papers which OCSD shall deem necessary to apply for and to assign or convey to OCSD, its successors and assigns, the sole and exclusive right, title and interest in such New Developments. SERVICE PROVIDER agrees to obtain or has obtained written assurances from its employees and Contract personnel of their CONTRACT to the terms hereof with regard to New Developments and Confidential Information. b. SERVICE PROVIDER warrants that SERVICE PROVIDER has good title to any New Developments,and the right to assign New Developments to OCSD free of any proprietary rights of any other party or any other encumbrance whatever. 13. Confidentiality and Non-Disclosure a. SERVICE PROVIDER acknowledges that in performing the Services hereunder, OCSD may have to disclose to SERVICE PROVIDER orally and in writing certain confidential information that OCSD considers proprietary and has developed at great expense and effort. As used herein,the term "Confidential Information" means any scientific or technical data, marketing, operating, financial, business or any other information, design, process, procedure, formula or improvement in written, printed, graphic, or electronically recorded materials, that is commercially valuable to OCSD and not generally known in the industry. SERVICE PROVIDER further acknowledges that the Services and any deliverables may incorporate Confidential Information. SERVICE PROVIDER agrees that all items of Confidential Information are proprietary to OCSD and shall remain the sole property of OCSD. b. SERVICE PROVIDER agrees as follows: I. To use the Confidential Information only for the purposes described herein;to not reproduce the Confidential Information; to hold in confidence and protect the confidential Information from dissemination to and use by anyone not a party to this CONTRACT; and to not use the Confidential Information to benefit itself or others. ii. To restrict access to the Confidential Information to personnel of SERVICE PROVIDER who (i) have a need to have such access and (it) have been advised of and have agreed in writing to treat such information in accordance with the terms of this CONTRACT. iii. To return all Confidential Information in SERVICE PROVIDER's possession upon termination of this CONTRACT or upon OCSD'S request,whichever occurs first. iv. To hold in confidence information and materials, if any,developed pursuant to the Services hereunder. c. The provisions of this Paragraph shall survive termination or expiration of this CONTRACT and shall continue for so long as the material remains confidential. 14. Safety OCSD's Safety and Accident Prevention Requirements are located in Appendix A to Exhibit"A". 15. Insurance SERVICE PROVIDER shall purchase and maintain, throughout the life of this CONTRACT, disability insurance as well as other insurance as defined in the Acknowledgement of Insurance Requirements (attached hereto and incorporated herein as Exhibit "C"). SERVICE PROVIDER shall not commence work under this CONTRACT until all required insurance is obtained in a form acceptable to OCSD. Failure to maintain required insurance coverage shall result in termination of this CONTRACT. Orange County Sanitation District 4 of 8 Specification No. S-2015-725BD 16. Indemnification SERVICE PROVIDER shall assume all responsibility for damages to property and/or injuries to persons, including accidental death, which may arise out of or be caused by SERVICE PROVIDER's services under this CONTRACT, and/or by its SubService Providers or by anyone directly or indirectly employed by SERVICE PROVIDER, and whether such damage or injury shall accrue or be discovered before or after the temtinafion of the CONTRACT. Except as to the sole active negligence of or willful misconduct of OCSD,SERVICE PROVIDER shall indemnify, protect, defend and hold harmless OCSD, its elected and appointed officials, officers, agents and employees, from and against any and all claims, liabilities, damages or expenses of any nature, including attorneys' fees: (a) for injury to or death of any person or damage to property or interference with the use of property, arising out of or in connection with SERVICE PROVIDER's performance under the CONTRACT, and/or (b) on account of use of any copyrighted or uncopyrighted material, composition, or process, or any patented or unpatented invention, article or appliance, furnished or used under the CONTRACT, and/or (c) on account of any goods and services provided under this CONTRACT. This indemnification provision shall apply to any acts or omissions, willful misconduct, or negligent misconduct, whether active or passive, on the part of SERVICE PROVIDER of or anyone employed by or working under SERVICE PROVIDER. To the maximum extent permitted by law, SERVICE PROVIDER's duty to defend shall apply whether or not such claims, allegations, lawsuits, or proceedings have merit or are meritless, or which involve claims or allegations that any of the parties to be defended were actively, passively,or concurrently negligent, or which otherwise assert that the parties to be defended are responsible, in whole or in part, for any loss, damage, or injury. SERVICE PROVIDER agrees to provide this defense immediately upon written notice from OCSD, and with well qualified, adequately insured, and experienced legal counsel acceptable to OCSD. This section shall survive the expiration or early termination of the CONTRACT. To the fullest extent permitted by law, SERVICE PROVIDER shall indemnify, defend, protect and hold harmless OCSD and all of OCSD's officials, officers, directors, employees, SERVICE PROVIDERS, and agents(collectively the"Indemnified Parties"),from any and against any and all claims, damages, liabilities, causes of action, suit, arbitration award, losses, judgments, fines, penalties, costs and expenses (including, without limitation, reasonable attorneys' fees, disbursements and court costs;individually,a"Claim";collectively, "Claims")which may arise from, result from, or are related to SERVICE PROVIDER's negligence, recklessness, or willful misconduct in performing the Services,orany breach orfailure of SERVICE PROVIDER to perform its Services contained in this CONTRACT. Notwithstanding the foregoing, nothing herein shall be construed to require SERVICE PROVIDER to indemnify the Indemnified Parties from any Claim arising solely from: (A) the active negligence or willful misconduct of the Indemnified Parties; or (B) a natural disaster or other act of God, such as an earthquake. Exceptions (A) through (B) above shall not apply, and SERVICE PROVIDER shall, to the fullest extent permitted by law, indemnify the Indemnified Parties,from Claims arising from more than one cause if any such cause taken alone would otherwise result in the obligation to indemnify hereunder." 17. Smoking Smoking is only allowed in designated areas. Smoking is not allowed in any building, electrically classified area or process area where methane gas may be present. Lack of compliance with OCSD Smoking policy will be cause for removal of offending personnel from the site, termination of the CONTRACT,or both. Orange County Sanitation District 5 of 8 Specification No. S-2015-725BD is. Warrantees There are no warranties,expressed or implied, except as expressly set forth herein. 19. Conflict of Interest SERVICE PROVIDER affirms that to the best of its knowledge there exists no actual or potential conflict between SERVICE PROVIDER's families, business or financial interest or its Services under this CONTRACT, and in the event of change in either its private interests or Services under this CONTRACT, it will raise with OCSD any question regarding possible conflict of interest which may arise as a result of such change. 20. No Solicitation of Employees No referral fee will be paid to SERVICE PROVIDER for a referral which leads to the employment of the candidate with the OCSD if such employment commences more than ninety(90)days after the date stamp appearing on the candidate's resume submitted by or through SERVICE PROVIDER, unless written extension has been given by OCSD'S Human Resources Department. 21. Termination a. OCSD reserves the right to terminate this CONTRACT, in whole or in part, without cause, at anytime, by written notice to SERVICE PROVIDER. Upon receipt of a termination notice, SERVICE PROVIDER shall immediately discontinue all work under this CONTRACT (unless the notice directs otherwise). OCSD shall thereafter, within thirty (30) days, pay SERVICE PROVIDER for work performed (cost and fee) to the dale of termination. SERVICE PROVIDER expressly waives any claim to receive anticipated profits to be earned during the uncompleted portion of the CONTRACT. Such notice of termination shall terminate this CONTRACT and release OCSD from any further fee,cost or claim hereunder by SERVICE PROVIDER other than for work performed to the date of termination. b. OCSD reserves the right to end an assignment with Assigned Employee(s), without or without cause, at any time by notifying SERVICE PROVIDER and SERVICE PROVIDER shall replace the assigned employee if requested by OCSD. In terminating an assignment with one or more Assigned Employee(s), OCSD shall not discriminate on the basis of race, religion, national origin, gender or other unlawful basis. In the event such termination is effected, the Assigned Employee shall immediately discontinue all work under this CONTRACT(unless the notice directs otherwise). c. OCSD may also immediately cancel for default of this CONTRACT in whole or in part by written notice to SERVICE PROVIDER: i. if SERVICE PROVIDER becomes insolvent or files a petition under the Bankruptcy Act;or ii. if SERVICE PROVIDER sells its business; or III. if SERVICE PROVIDER breaches any of the terms of this CONTRACT; or iv. if such breach is capable of cure and if the SERVICE PROVIDER fails to cure the default within thirty(30)days. d. All OCSD property in the possession or control of SERVICE PROVIDER shall be returned by SERVICE PROVIDER to OCSD on demand, or at the termination of this CONTRACT, whichever occurs first. 22. Damage to OCSD's Property Any OCSD property damaged by SERVICE PROVIDER will be subject to repair or replacement by SERVICE PROVIDER at no cost to OCSD. Orange County Sanitation District 6 Of 8 Specification No. S-2015-725BD 23. Drug-Free Workplace SERVICE PROVIDER and all its employees and sub-SERVICE PROVIDERS must adhere to the California Drug-Free Workplace Act, Sections 8350 through 8357. 24. Governing Law a. This CONTRACT shall be governed by and interpreted under the laws of the State of California and the Parties submit to jurisdiction in Orange County, in the event any action is brought in connection with this CONTRACT or the performance thereof. b. In the event of a dispute as to the construction or interpretation of this CONTRACT, or any rights or obligations hereunder, the Parties shall first attempt, in good faith, to resolve the dispute by mediation. The Parties shall mutually select a mediator to facilitate the resolution of the dispute. If the Parties are unable to agree on a mediator, the mediation shall be conducted in accordance with the Commercial Mediation Rules of the American Arbitration CONTRACT, through the alternate dispute resolution procedures of Judicial Arbitration through Mediation Services of Orange County("JAMS'),or any similar organization or entity conducting an alternate dispute resolution process. In the event the Parties are unable to timely resolve the dispute through mediation, the issues in dispute shall be submitted to arbitration pursuant to California Code of Civil Procedure, Part 3, Title 9, Sections 1280 at seq. For such purpose, an agreed arbitrator shall be selected, or in the absence of CONTRACT, each party shall select an arbitrator, and those two arbitrators shall select a third. Discovery may be conducted in connection with the arbitration proceeding pursuant to California Code of Civil Procedure Section 1283.05. The arbitrator,or three arbitrators acting as a board,shall take such evidence and make such investigation as deemed appropriate and shall render a written decision on the matter in question. The arbitrator shall decide each and every dispute in accordance with the laws of the State of California. The arbitrator's decision and award shall be subject to review for errors of fact or law in the Superior Court for the County of Orange, with a right of appeal from any judgment issued therein. 25. Modifications This CONTRACT may not be modified, changed or supplemented, nor may any obligations hereunder be waived or extensions of time for performance granted, except by written instrument signed by both Parties. 26, Assignment This CONTRACT and the rights, duties, and obligations hereunder may not be assigned by SERVICE PROVIDER without the prior written consent of OCSD. 27. Partial Invalidity Any provision of this CONTRACT which is found to be invalid or unenforceable shall be ineffective to the extent of such invalidity or unenforceability, and the invalidity or unenforceability of such provision shall not affect the validity or enforceability of the remaining provisions hereof. 28. Nonexclusive CONTRACT This CONTRACT is not exclusive to SERVICE PROVIDER. OCSD reserves the right to enter into similar or like CONTRACTS with other companies. OCSD also makes no guarantee of work to SERVICE PROVIDER. 29. Entire CONTRACT Orange County Sanitation District 7 of 8 Specification No. S-2015-725BD This CONTRACT constitutes the entire CONTRACT of the Parties and supersedes all prior written or oral and all contemporaneous oral CONTRACTs, understandings,and negotiations between the Parties with respect to the subject matter hereof. This CONTRACT is intended by the Parties as the final expression of their CONTRACT and may not be contradicted by evidence of any prior or contemporaneous CONTRACT. 30. Notices All notices under this CONTRACT must be in writing. Written notice shall be delivered by personal service or sent by registered or certified mail, postage prepaid, return receipt requested, or by any other overnight delivery service which delivers to the noticed destination and provides proof of delivery to the sender. Rejection or other refusal to accept or the inability to deliver because of changed addressed or which no notice was given as provided hereunder shall be deemed to be receipt of the notice, demand or request sent. All notices shall be effective when first received at the following addresses: OCSD: Natasha Dubrovski Principal Contracts Administrator Orange County Sanitation District 10844 Ellis Avenue Fountain Valley, CA 92708 SERVICE PROVIDER: Kimo Look CEO Project Partners, Inc. 23195 La Cadena Drive Laguna Hills, CA 92653 IN WITNESS WHEREOF, the Parties have executed this CONTRACT effective as of the date first written above at Fountain Valley, California. ORANGE COUNTY SANITATION DISTRICT Dated: By: John Nielsen, Chair Board of Directors Dated: By Kelly A. Lore,Clerk of the Board Dated: By Marc Dubois, Contracts/Purchasing Manager Dated: By Print Name and Title IRS Employers I.D. Number Orange County Sanitation District 8 Of 8 Specification No. S-2015-725BD ADMINISTRATION COMMITTEE Meeting Date TOBE.Of Dir. 11/12/15 11/18/15 AGENDA REPORT Item Item Number s 11 Orange County Sanitation District FROM: James D. Herberg, General Manager Originator: Lorenzo Tyner, Director of Finance and Administrative Services SUBJECT: REPROGRAPHICS AND RELATED SERVICES GENERAL MANAGER'S RECOMMENDATION A. Authorize a Purchase Order Contract with ARC Document Solutions, LLC for reprographics services per County of Orange Master Contract #RCA MA-017- 16010366, for one 3-year period (11/04/15— 11/03/18)for an aggregate amount not to exceed $200,000 per year; and B. Approve the option of two additional one-year renewals for an amount not to exceed $200,000 per year. SUMMARY OCSD uses a reprographics fine for the reproduction of plans, scanning and indexing documents to be loaded into the engineering SharePoint site, and a filing and distribution system for the ordering and tracking of plans and specifications for bidding of projects. These tools have enabled OCSD to maintain an optimal bid process incorporating a set of agreed upon procedures and minimum requirements to ensure a smooth bid process. To effectively maintain a smooth bid process for upcoming projects, as well as maintaining reprographics and related services for documentation of construction phase records and engineering specifications, staff recommends that a new purchase order be established with ARC Document Solutions, LLC. Pricing is based on a competitively bid/negotiated Regional Cooperative Agreement (RCA) for Reprographic Services. This contract is available for use in accordance with the terms and conditions and scope of work set forth. PRIOR COMMITTEE/BOARD ACTIONS N/A ADDITIONAL INFORMATION N/A CEQA N/A Page 1 of 2 BUDGET / PURCHASING ORDINANCE COMPLIANCE This request complies with authority levels of the Sanitation District's Purchasing Ordinance. The items purchased through the process are budgeted in the yearly Joint Operating Budget. ATTACHMENT The following attachment(s) may be viewed on-line at the OCSD website (wwwocsd.com) with the complete agenda package: N/A Page 2 of 2 ADMINISTRATION COMMITTEE Meeting Date TOBE.Or .Dir. 11/12/15 11/18/15 AGENDA REPORT Item Item Number 6 12 Orange County Sanitation District FROM: James D. Herberg, General Manager Originator: Lorenzo Tyner, Director of Finance and Administrative Services SUBJECT: CONSOLIDATED FINANCIAL REPORT FOR THE FIRST QUARTER ENDED SEPTEMBER 30, 2015 GENERAL MANAGER'S RECOMMENDATION Receive and file Orange County Sanitation District First Quarter Financial Report for the period ended September 30, 2015. SUMMARY Included in this consolidated report are the following quarterly financial reports for the period ended September 30, 2015: First Quarter Budget Review The Budget Review Summary provides the Directors, staff, and the general public with a comprehensive overview of the financial results of the Sanitation District through the first quarter ended September 30, 2015. • Quarterly Treasurer's Report This section reports on financial portfolio performance with respect to the Sanitation District's funds. Both Long-Term and Liquid Operating Monies Portfolios are summarized. A performance summary table can be found on page 2 of this section. The report also contains information on the U.S. and global economic outlook from the Sanitation District's investment manager, Chandler Asset Management. • Certificates of Participation Quarterly Report The report includes a summary of each outstanding debt issuance and a comparative chart illustrating the COP rate history. PRIOR COMMITTEE/BOARD ACTIONS N/A Page 1 of 3 ADDITIONAL INFORMATION The Quarterly treasurers report section of the Consolidated Quarterly Financial Report is being submitted in accordance with the District's investment policy that requires the report be submitted to the governing body following the end of each quarter and includes the following information: • Performance results in comparison with the 3-month treasury bill index for the liquid operating portfolio (and the Merrill Lynch Corp./Govt. 1-5 Year Bond index for the long term portfolio as identified in the investment policy and the Time- weighted total rate of return for the portfolio for the prior three months, twelve months, year to date, and since inception compared to the Benchmark returns for the same periods: Portfolio Performance Summary Quarter Ended September 30,2015 Liquid Operating Monies(%) Long-Term Operating Monies(%) Total Rate Total Rate of of Return Benchmark') Return Benchmark') 3 Months 0.06 0.01 0.52 0.68 6 Months 0.11 0.02 0.36 0.67 9 Months 0.18 0.02 1.18 1.84 12 Months 0.19 0.02 1.74 2.12 Since inception 30 Sept.95 2.84 2.61 4.71 4.42 • A listing of individual securities held at the end of each reporting period (See the detailed listings of each security contained within the report). • Cost and market values of the portfolios: Liquid Oper. Long-Term Cost $43.8 M $261.5 M MV $43.9 M $262.8 M • Modified duration of the portfolio compared to Benchmark: Liquid Oper. Long-Term B.M. 0.16 2.58 Port. 0.28 2.50 • Dollar change in value of the portfolio for a one-percent (1 %) change in interest rates: Liquid Oper.- $124,376 Long-Term- $6,553,148 • None of the portfolios are currently invested in reverse repurchase agreements. Page 2 of 3 • The percent of the Liquid Operating Monies portfolio maturing within 90 days: 54.0% • Average portfolio credit quality: AA+/Aa 1 • Percent of portfolio with credit ratings below "A" by any rating agency, and a description of such securities: Liquid Portfolio- no exceptions Long Term Portfolio- Percent of portfolio— 1.2% One security-AMRESCO Residential Securities 1999-1 maturing in 6/25/2029. Rated AA+ by S&P, but only BBB by Fitch Ratings. • All investments are in compliance with this policy and the California Government Code, except for the following Lehman Brother holdings that the District is pursuing collection through the bankruptcy court: Lehman Brothers Note-Defaulted $600,000 par value purchased 9/18/2008 Lehman Brothers Note-Defaulted $2,000,000 par value purchased 9/18/2008 Sufficient funds are available for OCSD to meet its operating expenditure requirements for the next six months. ATTACHMENT The following attachment(s) may be viewed on-line at the OCSD website (www.ocsd.coml with the complete agenda package: • Consolidated Financial Reports for the First Quarter Ended September 30, 2015. NOTE: The Executive Summary from the Comprehensive Quarterly Financial Report for the first quarter ended September 30, 2015 is included in hard copy, the entire report is available on-line at the OCSD website(mn .ocsd.com) with the complete agenda package. Page 3 of 3 Executive Summary Consolidated Financial Reports For the First Quarter Ended September 30, 2015 Included in this consolidated report are the following quarterly financial reports for the period ended September 30, 2015: • First Quarter Budget Review: The Budget Review Summary provides the Directors, staff, and the general public with a comprehensive overview of the financial results of the Sanitation District through the first quarter ended September 30, 2015. Contained within this Budget Review is the budget-to-actual status of the Collections, Treatment and Disposal Operations, the Capital Improvement Program, the Self-Insurance Program, and Debt Service Outlays. Also included is a Capital Assets Schedule as of September 30, 2015. Various detail information can be found in this report. In summary: a) Most major expense categories are anticipated to be at or below budget. b) Total revenues are at 3.1 percent mainly due to the timing of property tax and sewer fee distribution from the County that occurs mostly in the second and fourth quarters. These two revenue sources make up 88.6 percent of the District's total budgeted revenue. Except for Service Fees, Permit Fees, and Property Taxes, all other major revenue sources are currently tracking close to or exceeding revenue estimates. Overall, total revenues are projected to approximate budget at year-end. More detailed information on District revenues is provided within Section 1 — Pages 3 through 5. c) Collection, Treatment and Disposal Costs: As indicated within the Budget Review Summary of this report, the net operating requirements through the first quarter of $34.0 million is currently tracking at 22.8 percent of the $149.3 million budget. In addition, net operating expenses have decreased $1.6 million or 4.5 percent in comparison with the same period last year. Overall, staff expects the total operating costs to remain at budget throughout the remainder of the year. More detailed information on District operating expenses is provided within Section 1- Pages 1 through 3. The total cost per million gallons is approximately $1,974.7 based on flows of 187.1 million gallons per day. This is $70.3 per million gallons, or 3.4 percent lower than the budgeted cost per million gallon per day. A further description of these costs and benchmarking with other agencies is contained within Section 1 — Pages 6 through 8. Page 1 2015-16 First Quarter Review d) The total projected capital outlay cash flow of the Capital Improvement Program (CIP) for FY 2015-16 has been revised to $139.8 million, or 76.8 percent of the board approved cash outlay of$181.9 million. The actual cash outlay spending through the first quarter is $32.0 million, or 17.6 percent of the total budgeted outlay. More detailed information on the CIP budget review can be found in Section 3. • Quarterly Treasurer's Report; This section reports on financial portfolio performance with respect to the Sanitation District's funds. Both Long-Term and Liquid Operating Monies Portfolios are summarized. A performance summary table can be found on page 2 of this section. The report also contains information on the national economic outlook from the Sanitation District's money manager, Chandler Asset Management (Chandler). Chandler reported that the Long-Term Portfolio returned 52 basis points over the quarter, underperforming the Bank of America Merrill Lynch 1-5 year AAA U.S. Corporate and Government Index by 16 basis points, while the Liquid Operating Monies Portfolio returned 6 basis over the quarter, outperforming its benchmark, the three-month Treasury Bill index return of 5 basis points. Chandler further notes that Nonfarm payrolls rose by 142,000 in September, below the consensus forecast of 201,000. Meanwhile, the PCE price index is still running well below the Fed's 2.0% target, at just 0.3% on a year-over-year basis in August. In their view, a rate hike is still possible before year-end, but depending on domestic and global economic data, as well as any potential financial market volatility fueled by a US debt ceiling debate over the next few months, it could be pushed out to 2016. Fed funds futures currently imply that the Fed could remain on hold until March or even June of next year. The Federal Open Market Committee (FOMC) left policy rates unchanged at its September meeting. The Committee cautioned that "recent global economic and financial developments may restrain economic activity."Overall,the Fed's September policy statement was dovish and the outlook for future monetary policy changes remains uncertain. US economic data has been mixed. Over the past three months, payrolls have increased by an average of 167,000 per month, compared to the trailing six-month average of 199,000. In September the unemployment rate was unchanged at 5.1%, but the participation rate edged down and wages were flat. Meanwhile, housing still appears to be a growing source of strength for the US economy. In addition, consumer confidence remains strong, which should bode well for fourth quarter holiday shopping. The manufacturing sector, on the other hand, remains under pressure, largely due to the strength of the US dollar. Second quarter GDP growth was revised upward to an annualized rate of 3.9% from the second estimate of 3.7%. Market participants currently expect annualized GDP growth of about 2.4% in the third quarter, and 2.7% growth in the fourth quarter. Interest rate volatility remains elevated due to continued uncertainty regarding the outlook for global economic growth and the timing of the first fed funds rate hike. Page 2 Executive Summary Yields on 2-year and 10-year Treasury notes declined in September, offsetting increases in August. Mixed US economic data, divergent central bank monetary policies, and concerns about weakening economic growth in China and other emerging markets have influenced interest rates. Economic Outlook The domestic and global economic outlook modestly deteriorated during the third quarter of 2015. On the domestic front the unemployment rate continued to contract and is currently at 5.1% however broader measures of unemployment, as well as the participation rate, remain at levels inconsistent with full employment. The pace of job growth also contracted with the three month moving average of nonfarm payrolls currently at 167k versus 231k at the end of the prior quarter. Second quarter GDP was revised higher to 3.9%, versus 0.6% reading in the first quarter, however the outlook for GDP growth over the balance of the year is tepid. The global economic backdrop remains challenging as the growth outlook in Europe, Japan, and China continues to underwhelm. Commodity prices remain weak placing further downward pressure on inflation metrics, complicating the messaging of the Federal Reserve on normalizing monetary policy. Chandler is forecasting market volatility to remain elevated through the balance of the year. The Federal Reserve will continue to be a contributor to investor angst as Fed communication on a desire to tighten monetary policy conflict with the Fed's dual mandate of full employment and stable prices. Even if the Federal Reserve is able to raise rates later this year or early in 2016, the overall increase in rates will be low and the pace very gradual given the divergence in developed market central bank policies. The recent dislocation in markets, with investment grade credit spreads widening, will likely present some compelling investment opportunities in the coming months. • Quarterly Certificates of Participation (COP) Report The report includes a summary of each outstanding debt issuance and a comparative chart illustrating the COP rate history. Page 3 2015-16 First Quarter Review This Page Intentionally Left Blank Page 4 ADMINISTRATION COMMITTEE Meeting Date TOBd.of Dir. lt/12115 11/la/15 AGENDA REPORT RennNurnl,er Iem Numbe is Orange County Sanitation District FROM: James D. Herberg, General Manager Originator: Lorenzo Tyner, Director of Finance and Administrative Services SUBJECT: ORANGE COUNTY SANITATION DISTRICT COMPREHENSIVE ANNUAL FINANCIAL REPORT (CAFR) FOR THE YEAR END JUNE 30, 2015. GENERAL MANAGER'S RECOMMENDATION Receive and file the Sanitation District's Comprehensive Annual Financial Report for the year ended June 30, 2015, prepared by staff and audited by McGladrey, Certified Public Accountants, along with the following reports prepared by McGladrey: A. Report to the Administration Committee; and B. Independent Accountants' Report on Agreed-Upon Procedures Applied to Appropriations Limit Worksheets. SUMMARY The Sanitation District's independent auditors, McGladrey, have completed their examination of the Sanitation District's financial statements for the year ended June 30, 2015, and have issued an unmodified opinion. Each year, the Administration Committee reviews the results of the audit and the corresponding Auditor's report. During their audit, McGladrey, noted no matters involving the internal control over financial reporting and its operations that they consider to be material weakness. McGladrey will attend the meeting to respond to any questions of Directors. Staff has prepared the Comprehensive Annual Financial Report, including the audited financial statements. In the past, the Sanitation District has consistently earned the Certificate of Achievement for Excellence in Financial Reporting from the Government Finance Officers Association (GFOA). This year's report will also be submitted to GFOA for their review and consideration. PRIOR COMMITTEE/BOARD ACTIONS N/A ADDITIONAL INFORMATION N/A Page 1 of 2 ATTACHMENTS The following attachment(s)are included in hard copy,and may also be viewed on-line at the OCSD website (wwwocsd.com) with the complete agenda package and attachments: • Report to the Administration Committee • Independent Accountants' Report on Agreed-Upon Procedures Applied to Appropriations Limit Worksheets • Comprehensive Annual Financial Report for the Year Ended June 30, 2015. (Separately bound document) Page 2 of 2 Orange County Sanitation District Report to the Administration Committee October 23, 2015 McGladrey Assurance-Tax•Consulting MoGWn,LLP 18401 Von Kama 5"Floor Irvine,CA 92612-8531 • McGladrey U Muw.mc.mc5.6500 F949255.5091 glatlrey.com October 23,2015 Members of the Administration Committee Orange County Sanitation District Fountain Valley, California We are pleased to present this report related to our audit of the financial statements of the Orange County Sanitation District(the District)as of and for the year ended June 30, 2015. This report summarizes certain matters required by professional standards to be communicated to you in your oversight responsibility for the District's financial reporting process. This report is intended solely for the information and use of the Administration Committee,the Board of Directors and management, and is not intended to be, and should not be, used by anyone other than these specified parties. It will be our pleasure to respond to any questions you have about this report. We appreciate the opportunity to continue to be of service to the District. llle- l «11� MemLvr 0 the PSM InbmMlonal neMmk of Ind[ ndonl anounllnq lae and non-mn,fi,nf. Contents Required Communications 1-2 Summary of Significant Accounting Estimates 3-4 Summary of Uncorrected Misstatements 5 Exhibit—Significant Written Communications Between Management and Our Firm Required Communications Generally accepted auditing standards (AU-C 260, The Auditor's Communication With Those Charged With Governance) require the auditor to promote effective two-way communication between the auditor and those charged with governance. Consistent with this requirement,the following summarizes our responsibilities regarding the financial statement audit as well as observations arising from our audit that are significant and relevant to your responsibility to oversee the financial reporting process: Area Comments Our Responsibilities With Our responsibilities under auditing standards generally accepted in Regard to the Financial the United States of America have been described to you in our Statement Audit arrangement letter dated July 27, 2015. Our audit of the financial statements does not relieve management or those charged with governance of their responsibilities,which are also described in that letter. Overview of the Planned We have issued a separate communication regarding the planned Scope and Timing of the scope and timing of our audit and have discussed with you our Financial Statement Audit identification of, and planned audit response to, significant risks of material misstatement. Accounting Policies and Preferability of Accounting Policies and Practices Practices Under generally accepted accounting principles, in certain circumstances, management may select among alternative accounting practices. In our view, in such circumstances, management has selected the preferable accounting practice. Adoption of,or Change in,Accounting Policies Management has the ultimate responsibility for the appropriateness of the accounting policies used by the District. Following is a description of a significant accounting policy or its application that was either initially selected or changed during the year: • Implementation of Government Accounting Standards Board (GASB)Statement No. 68,Accounting and Financial Reporting for Pensions—an amendment of GASB Statement No. 27, and GASB Statement No. 71, Pension Transition for Contributions Made Subsequent to the Measurement Date—an amendment to GASB Statement No. 68. Significant or Unusual Transactions We did not identify any significant or unusual transactions or significant accounting policies in controversial or emerging areas for which there is a lack of authoritative guidance or consensus. Management's Judgments and Accounting Estimates Summary information about the process used by management in formulating particularly sensitive accounting estimates and about our conclusions regarding the reasonableness of those estimates is in the attached Summary of Significant Accounting Estimates. 1 Area Comments Audit Adjustments There were no audit adjustments made to the original trial balance presented to us to begin our audit. Uncorrected Misstatements Uncorrected misstatements are summarized in the attached Summary of Uncorrected Misstatements. Disagreements With We encountered no disagreements with management over the Management application of significant accounting principles,the basis for management's judgments on any significant matters,the scope of the audit or significant disclosures to be included in the financial statements. Consultations With Other We are not aware of any consultations management had with other Accountants accountants about accounting or auditing matters. Significant Issues No significant issues arising from the audit were discussed with or Discussed With were the subject of correspondence with management. Management Significant Difficulties We did not encounter any significant difficulties in dealing with Encountered in Performing management during the audit. the Audit Significant Written Copies of material written communications between our Firm and the Communications Between management of the District, including the representation letter Management and Our Firm provided to us by management, are attached in the Exhibit. 2 Orange County Sanitation District Summary of Significant Accounting Estimates Year Ended June 30, 2015 Accounting estimates are an integral part of the preparation of financial statements and are based upon management's current judgment.The process used by management encompasses its knowledge and experience about past and current events, and certain assumptions about future events. You may wish to monitor throughout the year the process used to determine and record these accounting estimates. The following describes the significant accounting estimates reflected in the District's June 30, 2015 financial statements: Basis for Our Conclusions on Management's Reasonableness of Estimate Accounting Policy Estimation Process Estimate Useful Lives of Long- The estimated useful Management We tested the Lived Assets lives of assets determines useful lives reasonableness of generally have the based on past information underlying following ranges: experience, engineer management's sewage collection estimates and industry estimate. Based on our facilities, 50 years; norms. Management procedures,we have sewage treatment reviews for changes in concluded that the facilities,40 years; the useful lives of long- assigned useful lives of sewage disposal lived assets by capital assets are facilities,40 years; and evaluating prominent reasonable. general plant and changes in administrative facilities, circumstances affecting 11.5 years. These capital assets to assets are depreciated determine whether using the straight-line impairment or change method. Construction in the useful life of a in progress is not capital asset has depreciated until ready occurred. for intended use. A capital asset is considered impaired if both the decline in the service utility of the capital asset is large in magnitude and the event or change in circumstances is outside the normal life cycle of the capital asset. 3 Basis for Our Conclusions on Management's Reasonableness of Estimate Accounting Policy Estimation Process Estimate Net Pension Liability Pension plans that Management utilizes We tested the meet the criteria for Orange County reasonableness of the recognition in Employees' Retirement information underlying accordance with GASB System's (OCERS) the actuarial Statement No. 68 are actuaries for its defined evaluations. Based on measured at the net of benefit plan. our procedures,we actuarially determined Management reviewed concluded that the net total pension liabilities and approved the pension liability and fiduciary net plan actuarial assumptions recorded is reasonable. assets. If the total and calculations used pension liabilities to determine the net exceed the fiduciary pension liability and net plan assets, it related components. results in a net pension liability,whereas a net pension asset is recorded if the total pension liability is less than the fiduciary net plan assets. 4 Orange County Sanitation District Summary of Uncorrected Misstatements Year Ended June 30, 2015 Effect-0ebit(Credit) Descdpdon Assets Liabilities Net Position Revenues Expenses Reversed opening equity misstatements $ - $ - $ 2,065,248 $ (869,384) $ (1,195,864) • Unamortized goodwill amortization related to IRWD excess purchase price (905,439) - 1,563,148 - (657,709) • Effects of additional capitalized interest from the prior year 605,875 - (622,250) - 16,375 • Variance in amortization of premium and discounts betyeen straight-line and effective interest methods - 656,595 (1,691,460) - 1,034,865 • Contingent liability for existing lifigadon - (500,000) - 500.000 Total affect (1,171,717) $ (869,384) $ (302,333) Statement of net position effect $ (299,51if4) $ 166,595 $ 142,969 5 Exhibit—Significant Written Communications Between Management and Our Firm Orange County Sanitation District Sawing: 10844 Ellis Avenue,Fountain Valley,0192708 Anaheim 714.962.2411 www.oaewers.com Brea October 23, 2015 Buena Park Cypress McGladrey LLP 18401 Von Kaman Avenue, 5th Floor FountainValley Irvine, CA 92612 Fullerton Garden Grove This representation letter is provided in connection with your audit of the financial statements of the Orange County Sanitation District(the District)as of and for the year Huntington Beach ended June 30, 2015 for the purpose of expressing an opinion on whether the financial rvine statements are presented fairly, in all material respects, in accordance with accounting L.Habra principles generally accepted in the United States of America(U.S. GAAP). We confirm, to the best of our knowledge and belief, that as of October 23, 2015: La Palma Los Alamitos Financial Statements Newport Beach 1. We have fulfilled our responsibilities, as set out in the terms of the audit arrangement letter dated July 27, 2015, for the preparation and fair presentation of the financial Orange statements referred to above in accordance with U.S. GAAP. Placentia 2. We acknowledge our responsibility for the design, implementation and maintenance Santa Ana of internal control relevant to the preparation and fair presentation of financial SealBeach statements that are free from material misstatement,whether due to fraud or error. Stanton 3. We acknowledge our responsibility for the design, implementation and maintenance of internal control to prevent and detect fraud. Tustin 4. Significant assumptions used by us in making accounting estimates, including those Villa Park measured at fair value, are reasonable and reflect our judgment based on our .e knowledge and experience about past and current events, and our assumptions about conditions we expect to exist and courses of action we expect to take. CostaSanit District 5. All events subsequent to the date of the financial statements, and for which U.S. Midway City GAAP requires adjustment or disclosure, have been adjusted or disclosed. sanitary District 6. The effects of all known actual or possible litigation and claims have been accounted Irvine Ranch for and disclosed in accordance with U.S. GAAP. Water District Yorba Linda 7. There are no capital assets that have experienced permanent impairment as Water District indicated in Governmental Accounting Standards Board (GASB)Statement No. 42, Accounting and Financial Reporting for Impairment of Capital Assets and for Insurance Recoveries. 8. The amounts due to the Irvine Ranch Water District of$2,869,329 have been accurately calculated based on the applicable agreements. F' 9. There are no unasserted claims or assessments that our lawyer has advised us are probable of assertion and must be disclosed in accordance with GASB Statement No. 10 or GASB Statement No. 62. To protect public health and the environment by providing effective wastewater collection, treatment,and recycling. McGladrey LLP October 23, 2015 Page 2 10. We have no direct or indirect, legal or moral obligation for any debt of any organization, public or private, that is not disclosed in the financial statements. e r^4e dE Ex+�"c 11, We have complied with all aspects of Contractual agreements that would have a material effect on the financial statements in the event of noncompliance. In connection therewith, we specifically represent that we are responsible for determining that we are not subject to the requirements of the Single Audit Act and U.S. Office of Management and Budget Circular No. A-133, because we have not received, expended or otherwise been the beneficiary of the required amount of federal awards during the period of this audit. 12. We have provided all amendments to the Orange County Employer Retirement System's pension plan, and there were no amendments to the pension plan subsequent to December 31, 2013 valuation date. 13. We have implemented GASB Statement No. 68, Accounting and Financial Reporting for Pensions—an amendment of GASB Statement No. 27, and GASB Statement No. 71, Pension Transition for Contributions Made Subsequent to the Measurement Date—an amendment of GASB Statement No. 68, as discussed in Note 1 to the financial statements. The District has accurately disclosed the effect of adopting the guidance had on its financial position and the changes in net position. 14, We have Completed the process of evaluating the effect that would result from the implementation of GASB pronouncements that were effective for the fiscal year ended June 30, 2015. We believe that the effect on the District's net position and the changes in net position for any new pronouncements would be insignificant. 15. We have informed you of all uncorrected misstatements. As of and for the year ended June 30, 2015, we believe that the effects of the uncorrected misstatements aggregated by you and summarized below are immaterial, both individually and in the aggregate,to the financial statements. For purposes of this representation, we consider items to be material, regardless of their size, if they involve the misstatement or omission of accounting information that, in light of surrounding circumstances, makes it probable that the judgment of a reasonable person relying on the information would be changed or influenced by the omission or misstatement. Effect—Debit(Credit) Description Assets Liabilities Net Position Revenues Expenses Reversed opening equity misstatements $ - $ - $ 2.065,248 $ (869.384) $ (1,195,864) • Unamod¢ed goadW,ll amortization related to IRM excess purchase price (905,439) - 1,563,148 - (657.709) • Effects of additional capitalized interest from the prior year 605,875 - (622,250) - 16,375 •Variance in amortization of premium am discounts beevaen straight-line and effective interest methods - 656,595 (1,fi91,460) - 1.034.865 • Contingent liability for existing litigation - (500,000) - 500,000 Total effect (1,171,717) statement of net position effect $ (299.564) $ 156,595 $ 142,959 McGladrey LLP October 23, 2015 Page 3 _ Information Provided 16. We have provided you with: a. Access to all information of which we are aware that is relevant to the preparation and fair presentation of the financial statements such as records, documentation and other matters. b. Additional information that you have requested from us for the purpose of the audit. c. Unrestricted access to persons within the District from whom you determined it necessary to obtain audit evidence. d. Minutes of the meetings of the governing board and committees, or summaries of actions of recent meetings for which minutes have not yet been prepared. 17. All transactions have been recorded in the accounting records and are reflected in the financial statements. 18. We have disclosed to you the results of our assessment of risk that the financial statements may be materially misstated as a result of fraud. 19. We have no knowledge of allegations of fraud or suspected fraud affecting the District's financial statements involving: a. Management. b. Employees who have significant roles in internal control. c. Others where the fraud could have a material effect on the financial statements. 20. We have no knowledge of any allegations of fraud or suspected fraud affecting the District's financial statements received in communications from employees, former employees, analysts, regulators, short sellers or others. 21. We have no knowledge of noncompliance or suspected noncompliance with laws or regulations whose effects were considered when preparing financial statements. 22. We have disclosed to you all known actual or possible litigation and claims whose effects should be considered when preparing the financial statements. 23. We have disclosed to you the identity of the District's related parties and all the related- party relationships and transactions of which we are aware. 24. We are aware of no significant deficiencies, including material weaknesses, in the design or operation of internal controls that could adversely affect the District's ability to record, process, summarize or report financial data. 25. We are aware of no communications from regulatory agencies concerning noncompliance with,or deficiencies in, financial reporting practices. 26, There were no transactions with related parties during the year ended June 30, 2015. McGladrey LLP October 23, 2015 Page 4 a� Supplementary Information INE E1"P 27. With respect to supplementary information presented in relation to the financial statements as a whole: a. We acknowledge our responsibility for the presentation of such information. b. We believe such information, including its form and content, is fairly presented in accordance with U.S. GAAP. c. The methods of measurement or presentation have not changed from those used in the prior period. 28. With respect to management's discussion and analysis, Proportionate Share of the Net Pension Liability, Schedule of District Contributions,and Schedules of Funding Progress presented as required by GASB to supplement the basic financial statements: a. We acknowledge our responsibility for the presentation of such required supplementary information. b. We believe such required supplementary information is measured and presented in accordance with guidelines prescribed by U.S. GAAP. c. The methods of measurement or presentation have not changed from those used in the prior period. 29. During the course of your audit,you may have accumulated records containing data that should be reflected in our books and records.All such data have been so reflected. Accordingly, copies of such records in your possession are no longer needed by us. ORANGE COUNTY SANITATION DISTRICT James Merberg, General Manager Lorenzo Tyner, Q y ctor of Finance and Administrative ervices / r i Mi a White, Controller j Orange County Sanitation District 10844 Pis Avenue,Fountain Valley,CA92708 Anaheim 714.962.2411Buena Park vxm.acsewers.com Brea October 23, 2015 Cypress FountainValley McGladrey LLP FuVerton 18401 Von Karman Avenue, 5th floor Irvine, CA 92612 Garden Grow Huntington Beach In connection with your engagement to perform, in accordance with attestation standards Irvine established by the American Institute of Certified Public Accountants, specified agreed- upon procedures with respect to certain records and transactions of Orange County La Habra Sanitation District(the District)for the year ended June 30, 2015, for the purpose of determining as to whether the District's appropriation limitation calculation was computed La Palma in accordance with Article XIII-B of the Constitution of the State of California, we confirm, LosAlamitos to the best of our knowledge and belief the following representations made to you during the course of your engagement: Newport Beach 1. We understand that we have the responsibility for the appropriation limitation Orange Calculation. Placentia 2. We understand that we have the responsibility for determining that such criteria are Santa Ana i appropriate for our purposes. SealBeach 3. There are no known matters contradicting the appropriation limitation calculation nor Stimton any communication from regulatory agencies affecting the appropriation limitation calculation. Tustin Vila Park 4. We have made available to you all records and related data relevant to the subject matter and the agreed-upon procedures. County of Orange 5. There has been no knowledge of fraud or suspected fraud affecting the entity Costa involving: DistrictSanitary MidwayCity a. Management. IrvineSanitary District Ranch b. Employees who have significant roles in internal control. DistrictWater c. Others where fraud could have a material effect on the appropriation limitation Yoma calculation. District Water 6. We acknowledge our responsibility for the design and implementation of programs and controls to provide reasonable assurance that fraud is prevented and detected. 7. We have no knowledge of any allegations of fraud or suspected fraud affecting the Company received in communications from employees, former employees,analysts, �y regulators or others. 8. We have responded fully to all inquiries made to us by you during your engagement. 9. During the course of your engagement, you may have accumulated records containing data that should be reflected in our books and records. All such data have " been so reflected.Accordingly, copies of such records in your possession are no longer needed by us. To protect public health and the environment by providing effective wastewater collection,treatment,and recycling. McGladrey LLP October 23, 2015 Page 2 ORANGE COUNTY SANITATION DISTRICT rF,�� IXf ENJP �n '//`/'/ James I erberg General Manager Lotenzo Tyner,qWbctor of Finance and Administrativ Services /u- M!*White, r er M6ladrey LLP 18401 Van Kaman, 5m Floor Irvine,CA 92612-8531 O 949.255.6500 F 949.255,5091 = McGladrey wv nncgladnayxom Independent Accountant's Report on Applying Agreed-Upon Procedures Board of Directors Orange County Sanitation District Fountain Valley, California We have performed the procedures enumerated below to the accompanying Appropriations Limit Calculation of the Orange County Sanitation District(the District)for the year ended June 30, 2015. These procedures, which were agreed to by the District and the League of California Cities (as presented in the publication entitled Agreed-Upon Procedures Applied to the Appropriations Limitation Prescribed by Article XIII-B of the California Constitution), were performed solely to assist the District in meeting the requirements of Section 1.5 of Article XIII-B of the California Constitution. The District's management is responsible for the Appropriations Limit Calculation. This agreed-upon procedures engagement was conducted in accordance with attestation standards established by the American Institute of Certified Public Accountants. The sufficiency of these procedures is solely the responsibility of those parties specified in this report.Consequently,we make no representation regarding the sufficiency of the procedures described below,either for the purpose for which this report has been requested or for any other purpose. The procedures performed and our findings were as follows: 1. We obtained the completed internal calculations from management and compared the limit and annual adjustment factors included in those calculations to the limit and annual adjustment factors that were adopted by a resolution of the Board of Directors. We also compared the population and inflation options included in the aforementioned worksheets to those that were selected by a recorded vote of the Board of Directors. Finding: No exceptions were noted as a result of our procedures. 2. For the accompanying Appropriations Limit Calculation,we added line A, last year's limit,to line E,total adjustments, and compared the resulting amount to line F, this years limit. Finding: No exceptions were noted as a result of our procedures. 3. We compared the current year information presented in the accompanying Appropriations Limit Calculation to the supporting calculations described in item 1 above. Finding: No exceptions were noted as a result of our procedures. 4. We compared the prior year Appropriations Limit presented in the accompanying Appropriations Limit Calculation to the prior year Appropriations Limit adopted by the Board of Directors for the prior year. Finding: No exceptions were noted as a result of our procedures. 1 MenLerolrl,e PSM IMemubnalnerworkol urlgzrdeM rrmuMryu »dmnfuhlrgfirmi. We were not engaged to and did not conduct an audit, the objective of which would be the expression of an opinion on the accompanying Appropriations Limit Calculation of the District. Accordingly, we do not express such an opinion. Had we performed additional procedures, other matters might have come to our attention that would have been reported to you. No procedures have been performed with respect to the determination of the appropriations limit for the base year, as defined by Article XIII-B of the California Constitution. This report is intended solely for the information and use of the Board of Directors and management of the District, and is not intended to be, and should not be, used by anyone other than these specified parties. However, this report is a matter of public record and its distribution is not limited. /r/C.�[waecy LGP Irvine, California/ October 23, 2015 2 Orange County Sanitation District Appropriations Limit Calculation Year Ended June 30,2015 Amount Source A. Last year's limit $ 90,878,266 B. Adjustment factors 1. Population change 1.0070 State Finance 2. Per capita change 0.9977 State Finance Total adjustment[(B.1 x S.2)-1.0) 0.0047 (B.1xB.2) C. Annual adjustment 425,665 (BxA) D. Other adjustments: 1. Loss responsibility(-) - 2. Transfer to private(-) - 3. Transfer to fees(-) - 4. Assumed responsibility(+) Subtotal - E. Total adjustments 425,665 (C+D) F. This year's limit $ 91.303,931 (A+E) 3 ADMINISTRATION COMMITTEE Meeting Dare TOBA.of Dir. 11/12/15 11/1811S AGENDA REPORT Item Number Item Nu bar 8 14 Orange County Sanitation District FROM: James D. Herberg, General Manager Originator: Celia Chandler, Director of Human Resources SUBJECT: OWNER CONTROLLED INSURANCE PROGRAM EXTENSION GENERAL MANAGER'S RECOMMENDATION Approve the purchase of a multi-year extension of the Owner Controlled Insurance Program at a total cost of $725,612 for five policies covering three layers of liability coverage, workers compensation coverage, and pollution coverage, through December 31, 2017. SUMMARY The Sanitation District began an Owner Controlled Insurance Program (OCIP) in 2008 in order to save money on the insurance costs for large construction projects. The OCIP covers approximately 20 projects. The most recent estimate by the Sanitation District's OCIP Administrator, Aon Risk Services, is that the OCIP is saving the Sanitation District approximately $3 million by buying in bulk as compared to the alternative, which would involve the cost of the contractors and subcontractors each purchasing their own insurance separately. The OCIP will expire in December 31, 2015. Because three large projects have not yet finished, another extension is needed. The OCIP insurers have quoted $725,612 for that extension. That quote includes $100 million in liability limits, and also workers compensation coverage. In addition, pollution insurance is included. The bulk of the construction which is not finished is connected with the project: Sludge Thickening, Dewatering and Odor Control at Plant 1 (P1-101), (almost 90% of the remaining OCIP construction), while much smaller amounts are connected with projects: Sludge Digester Rehabilitation at Plant No. 1 (P1-100) and Solids Thickening and Processing Upgrades (P2-89). Project P1-101, expected to have $124 million in construction value when completed, was started in January 2013. Staff agrees with Aon's belief that there are no options balancing cost effectiveness and risk better than purchasing the extension from the existing insurers. Aon estimates that the cost to the District for contractors to take over the insurance would be over $1 million, if carriers would even agree to do so for projects in progress. Page 1 of 3 PRIOR COMMITTEE/BOARD ACTIONS June 2013 — The Board approved a Professional Services Agreement with Aon Risk Services, Inc. to continue acting as the Broker/Administrator for the OCIP. March 2008 — The Board approved the purchase of insurance policies for a five-year "rolling OCIP", comprising a variety of large Capital Improvement Projects beginning in the following five years. October 2007 — The Board approved a Professional Services Agreement with Aon Risk Services, Inc. to act as the Broker/Administrator for the OCIP. ADDITIONAL INFORMATION In recent years many governmental agencies have started OCIPs as a way of saving money on construction. The Sanitation District hired a consultant in 2007 who recommended that a 'rolling OCIP" would be feasible, and later in 2007 the Sanitation District chose Aon to administer the OCIP. The Board approved a package of insurance policies for the OCIP in 2008, costing around $4 million. The OCIP has contained approximately 20 different Capital Improvement Projects over the years, and the total paid construction value of the projects is approximately $250 million so far. The total projected construction value at the conclusion of the OCIP is expected to be roughly $330 million. Three of the projects, including the largest one of the 20, have not yet finished. Since the OCIP was developed in 2008 the Sanitation District has adjusted its lineup of OCIP projects, including changes to the cost and timing of projects. The OCIP was extended in 2013, through 2015, for $25,000. Insurance companies are very reluctant to write long-term insurance policies because of regulatory restrictions and because of restrictions placed on them by their reinsurers. As a result, the extension was only through 2015. Now another extension is needed. Staff and Aon have explored other options, including the Sanitation District completely self-insuring this risk, partly self-insuring this risk, getting quotes from other insurers, and requiring contractors and subcontractors to supply insurance after December 31, 2015. It is in general very difficult to change insurers for construction that is over 50% complete, and the cost tends to be very high. Staff agrees with Aon that none of these options is as feasible as extending the OCIP as Aon suggests with the existing insurers. CEQA N/A Page 2 of 3 BUDGET/PURCHASING ORDINANCE COMPLIANCE This request complies with authority levels of the Sanitation District's Purchasing Ordinance. This item is not budgeted. As the OCIP supports the Capital Improvement Program (CIP), funds will be identified and transferred from unexpended funds within the total budget. ATTACHMENT The following attachments) maybe viewed on-line at the OCSD website (wwwocsd.corn with the complete agenda package: N/A Page 3 of 3 ITEM NO. 15 MINUTES OF THE STEERING COMMITTEE Orange County Sanitation District Wednesday, October 28, 2015 at 5:00 p.m. A regular meeting of the Steering Committee of the Orange County Sanitation District was called to order by Chair Beamish on Wednesday, October 28, 2015 at 5:05 p.m. in the Administration Building of the Orange County Sanitation District. A quorum was declared present, as follows: COMMITTEE MEMBERS PRESENT: STAFF PRESENT: John Nielsen, Chair Jim Herberg, General Manager Greg Sebourn, Vice-Chair Bob Ghirelli, Assistant General John Withers, Operations Committee Manager Chair Celia Chandler, Director of Human Tom Beamish, Member-At-Large Resources Lucille Kring, Member-At-Large Lorenzo Tyner, Director of Finance & David Shawver, Member-At-Large Administrative Services Ed Torres, Director of Operations & COMMITTEE MEMBERS ABSENT: Maintenance Keith Curry, Administration Committee Kelly A. Lore, Clerk of the Board Chair Jennifer Cabral Mark Esquer Dean Fisher Norbert Gaia Al Garcia Andrew Nau OTHERS PRESENT: Brad Hogin, General Counsel PUBLIC COMMENTS: None. REPORTS General Manager Jim Herberg introduced and welcomed the new Director of Human Resources, Celia Chandler. Chair Nielsen reported on the success of the 2015 State of the District event including the District's accomplishments and the Annual Report which provided the first communication piece that emphasized our"brand" as a resource recovery facility. 10/2a/2015 Steering Committee Minutes Page 1 d3 Director Withers commended the staff on the "5 minutes per month" information push that was initiated this month. Chair Nielsen also reported on the Strategic Plan Update session that was held on October 21. Staff will take the information received, make any necessary changes and bring it back in December for adoption. He also announced that Adam Hutchinson, OCWD's Recharge Planning Manager, will make a presentation on storm water capture to the OCSD Committees in November. Chair Nielsen then provided an update from the Legislative and Public Affairs (LAPA) Committee including: outreach and educational efforts; State and Federal Lobbyist contract renewals; and the upcoming presentation from Adam Link with CASA at the November LAPA Committee meeting. The Committee requested that the OCSD representatives on CASA's Legislative Committees provide any agendas and updates to the LAPA Committee. CONSENT CALENDAR: 1. APPROVAL OF MINUTES (Clerk of the Board) MOVED, SECONDED, AND DULY CARRIED TO: Approve Minutes of the September 23, 2015 Regular Steering Committee Meeting. AYES: Beamish; Kring; Nielsen; Seboum; Shawver and Withers NOES: None ABSTENTIONS: None ABSENT: Curry NON-CONSENT CALENDAR: 2. GENERAL MANAGER COMPENSATION AND BENEFITS (John Nielsen) RECOMMENDATION: Recommend to the Board of Directors to: Adopt Resolution No. OCSD 15-23 entitled, "A Resolution of the Board of Directors of the Orange County Sanitation District approving salary increase, salary range adjustment, and changes to benefits for the General Manager for Fiscal Year 2015-2016," authorizing the Board Chair to implement a base building salary increase and corresponding salary range adjustment of 7% retroactive to July 10, 2015, and changes to the benefits package for the General Manager, for a total amount not to exceed $41,107. AYES: Beamish; Kring; Nielsen; Sebourn; Shawver and Withers NOES: None 10/25/2015 Steering Committee Minutes Page 2 of 3 ABSTENTIONS: None ABSENT: Curry CLOSED SESSION: General Counsel, Brad Hogin announced that there will be no closed session this evening. OTHER BUSINESS AND COMMUNICATIONS OR SUPPLEMENTAL AGENDA ITEMS, IF ANY: Director Shawver requested that OCSD supply a truckload of compost for use in the new community garden in the City of Stanton; the ribbon cutting to be held on November 16, 2015. Staff will look into the availability and logistics. ADJOURNMENT: The Chair declared the meeting adjourned at 5:24 p.m. to the next Steering Committee meeting to be held on Wednesday, November 18, 2015 at 5:00 p.m. Submitted by: Kelly A. Lore Clerk of the Board 10/25/2015 Steering Committee Minutes Page 3 of 3 STEERING COMMITTEE Meeting Date TOBE.Or .Dir. 11/18/15 11/18/15 AGENDA REPORT Item Item Number 2 16 Orange County Sanitation District FROM: John Nielsen, Board Chair SUBJECT: GENERAL MANAGER COMPENSATION AND BENEFITS GENERAL MANAGER'S RECOMMENDATION Adopt Resolution No. OCSD 15-24 entitled, "A Resolution of the Board of Directors of Orange County Sanitation District amending the salary increase, salary range adjustment, and changes to benefits for the General Manager for Fiscal Year 2015-2016." SUMMARY The attached Resolution No. OCSD 15-24 amends Resolution No. OCSD 15-23. Under Resolution No. OCSD 15-23, adopted at the October 28, 2015 Board meeting, the Board authorized changes to the General Manager's salary. However, the paragraph describing the specific types and amounts of the General Manager's benefits was inadvertently omitted. Thus, Resolution No. OCSD 15-24 corrects the omission and authorizes the changes to the General Manager's benefits, as originally described the October 28, 2015 Board Agenda Report. Resolution No. OCSD 15-23 and the October 28, 2015 Agenda Report entitled "General Manager Compensation and Benefits" are also attached herein. PRIOR COMMITTEE/BOARD ACTIONS October 2015 — Board adopted Resolution No. OCSD 15-23, approving a base building salary increase for the General Manager of 7% of salary, to adjust the corresponding salary range by 7% for FY 2015-2016, and to implement changes to the General Manager's benefits package, effective July 10, 2015. August 2015 — Board authorized the Chair to initiate discussions with the General Manager regarding his compensation and benefits package in closed session. June 2015 — Steering Committee conducted the annual performance evaluation of the General Manager in closed session. November 2014 — Board approved Resolution No. OCSD 14-15, approving a base building salary increase for the General Manager of 3% of salary and to adjust the corresponding salary range by 3% for FY 2014-2015, effective July 11, 2014. June 2014 — Steering Committee conducted the annual performance evaluation of the General Manager in closed session. Page 1 of 2 1 I25603.1 February 2013 — Board approved appointment of James D. Herberg to the position of General Manager and approved the compensation and benefits package, effective April 1, 2013. ADDITIONAL INFORMATION N/A CEQA N/A BUDGET/PURCHASING ORDINANCE COMPLIANCE N/A ATTACHMENTS The following attachment(s)are attached in hard copy and may also be viewed on-line at the OCSD website (www.ocsd.coml with the complete agenda package: • Resolution No. OCSD 15-24 • Resolution No. OCSD 15-23 • Board Agenda Report, October 28, 2015 Page 2 of 2 1 t25603.1 ATTACHMENT RESOLUTION NO. OCSD 15-24 A RESOLUTION OF THE BOARD OF DIRECTORS OF THE ORANGE COUNTY SANITATION DISTRICT AMENDING THE SALARY INCREASE, SALARY RANGE ADJUSTMENT, AND CHANGES TO BENEFITS FOR THE GENERAL MANAGER FOR FISCAL YEAR 2015-2016 NOW, THEREFORE, the Board of Directors of the Orange County Sanitation District, DOES HEREBY RESOLVE, DETERMINE, AND ORDER that Section 1b be added and Section 2 be amended to Resolution 15-23 to read as follows: 1. That the Board of Directors hereby authorizes and approves the following changes to General Manager's salary, which shall become effective retroactively to the first pay period of July 2015: a. A base building salary increase for the General Manager of 7% of salary and to adjust the corresponding salary range by 7%. b. A benefits package that would include those benefits offered to represented and unrepresented employees, including medical, dental, vision, disability insurance and paid leave. The General Manager's benefits package also will include additional life insurance coverage at two times (2x) salary, $5,400 automobile allowance, 6% plus $1,250 investment incentive salary (IIS), a $5,000 employer-paid 457(b) deferred compensation contribution, and leave accruals at 250 hours per year, all such benefits projected to cost $25,606. 2. That the Board Chair, or his designee, is authorized to implement the changes to salary range and salary and benefits package approved herein. 1125326.1 0CSI) 15-24-1 PASSED AND ADOPTED at a regular meeting of the Board of Directors held November 18, 2015. John Nielsen Board Chair ATTEST: Kelly Lore, Clerk of the Board 1125326.1 DCSD 15-24-2 STATE OF CALIFORNIA ) ss COUNTY OF ORANGE ) I, Kelly A. Lore, Clerk of the Board of Directors of the Orange County Sanitation District, do hereby certify that the foregoing Resolution No. OCSD 15-24 was passed and adopted at a regular meeting of said Board on the 181h day of November 2015, by the following vote, to wit: AYES: NOES: ABSTENTIONS: ABSENT: IN WITNESS WHEREOF, I have hereunto set my hand and affixed the official seal of Orange County Sanitation District this 18'h day of November 2015. Kelly A. Lore Clerk of the Board of Directors Orange County Sanitation District 1125326.1 OCSD 15-24-3 ATTACHMENT RESOLUTION NO. OCSD 15-23 A RESOLUTION OF THE BOARD OF DIRECTORS OF THE ORANGE COUNTY SANITATION DISTRICT APPROVING SALARY INCREASE, SALARY RANGE ADJUSTMENT,AND CHANGES TO BENEFITS FOR THE GENERAL MANAGER FOR FISCAL YEAR 2015-2016 WHEREAS, the General Manager provides organizational leadership, strategic direction, and District oversight for Orange County Sanitation District (OCSD); and WHEREAS,the General Manager serves an at-will employment status, which may be terminated at any time by the Board with or without cause with no liability; and WHEREAS, it is OCSD's philosophy to compensate employee classifications competitively, which currently can be achieved through alignment with the salary market; and WHEREAS, the July 1, 2014, At-Will Agreement with the General Manager provides that, "District's Steering Committee shall meet with General Manager in August of each year during the term of this Agreement to review and evaluate his performance over the prior year. The Steering Committee shall make its recommendation(s) to the Board concerning adjustment to the compensation and/or benefits paid or provided to General Manager, to be effective in July of the year of review. After consideration of the recommendation(s) of the Steering Committee, the Board shall determine and approve the compensation, including benefits, payable to General Manager, which generally becomes effective July of the fiscal year of the review"; and WHEREAS, the Steering Committee commenced its review of the General Managers performance in June 2015, finalized its review and made its recommendation to the Board on October 28, 2015. NOW, THEREFORE, the Board of Directors of the Orange County Sanitation District, DOES HEREBY RESOLVE, DETERMINE, AND ORDER: 1. That the Board of Directors hereby authorizes and approves the following changes to General Manager's salary, which shall become effective retroactively to the first pay period of July 2015: a. A base building salary increase for the General Manager of 7% of salary and to adjust the corresponding salary range by 7%. 2. That the Board Chair, or his designee, is authorized to implement the changes to salary range and salary approved herein. OCSD 15-23-1 PASSED AND ADOPTED at a regular meeting of the Board of Directors held October 28, 2015. Jo n Nielsen Bo d Chair ATTEST: O e ly Lor , Clibrk of Board OCSD 15-23-2 General Manager Pay Tables July 2014 and Proposed 2015 Orange County Sanitation District Classification and Compensation Plan Rates Effective July 1,2014 GENERAL MANAGER Classification Pay Grade Minimum I Midpoint I Control Point Maximum General Manager EMT120 $ 1]5,590 1 $ 220,739 1 $ 238,399 $ 284,58] Orange County Sanitation District Classification and Compensation Plan PROPOSED Rates Effective July 1,2015 GENERAL MANAGER Classification Pay Grade Minimum I Midpoint I Control Point Maximum General Manager EMT120 S 188.952 IS 236191 1 S 255.087 5 283429 OCSD 15-233 STATE OF CALIFORNIA ) as COUNTY OF ORANGE ) I, Kelly A. Lore, Clerk of the Board of Directors of the Orange County Sanitation District, do hereby certify that the foregoing Resolution No. OCSD 15-23 was passed and adopted at a regular meeting of said Board on the 281h day of October 2015, by the following vote, to wit: AYES: Bartlett; Beamish; Deaton; Katapodis; Kiley; Kim; Kring; Mills; R. Murphy; Nagel; Nielsen; Ooten (Alternate); Parker; Schott (Alternate); Sebourn; Shawver, Tinajero; Wanke; Withers and Yarc NOES: None ABSTENTIONS: M. Murphy (Alternate); and Peotter (Alternate) ABSENT: Diep; Jones; and F. Smith IN WITNESS WHEREOF, I have hereunto set my hand and affixed the official seal of Orange County Sanitation District this 28th day of October 2015. Kell A. L r Cl k of t Board of Directors Orange County Sanitation District OCSD 15-23-4 ATTACHMENT STEERING COMMITTEE Meeting Date TOBE.Or .Dir. 10/28/15 10/28/15 AGENDA REPORT Item Item Number 2 16 Orange County Sanitation District FROM: John Nielsen, Board Chair SUBJECT: GENERAL MANAGER COMPENSATION AND BENEFITS BOARD CHAIR'S RECOMMENDATION Adopt Resolution No. OCSD 15-23 entitled, "A Resolution of the Board of Directors of the Orange County Sanitation District approving salary increase, salary range adjustment, and changes to benefits for the General Manager for Fiscal Year 2015-2016,"authorizing the Board Chair to implement a base building salary increase and corresponding salary range adjustment of 7% retroactive to July 10, 2015, and changes to the benefits package for the General Manager, for a total amount not to exceed $41,107. SUMMARY The General Manager is employed on an At-Will basis, and serves at the pleasure of the Board of Directors. Since the General Manager was appointed to this position in April 2013, the Board has approved one (1) base building salary increase of 3% and a corresponding salary range adjustment in Fiscal Year 2014-2015. The Board Chair is recommending a base building salary increase and corresponding salary range adjustment of 7%, at a total cost not to exceed $15,501, for Fiscal Year 2015-2016. The proposed 7% base building salary increase and the corresponding salary range adjustment would move the General Manager's salary range market position from the 20th percentile to the 26th percentile for Fiscal Year 2015-2016. Similarly, the proposed salary increase would move OCSD's General Manager's market position in terms of incumbents' (OCSD's comparison agencies) salaries and total compensation, from the tat percentile to 9th percentile of peers' salaries, and from the 3rd percentile to 15th percentile of peers' total compensation. The General Manager's market position will be revisited through the current comprehensive classification and compensation study, which will provide the Board with data for consideration on an organization-wide structural alignment of its pay systems. Pursuant to the understanding with the General Manager at the beginning of negotiations, the salary changes would take effect retroactively to July 10, 2015, the first pay period in the current fiscal year. The Board Chair also recommends implementing changes to the General Manager's benefits package to more closely align with those offered to represented and unrepresented employees, at a projected cost of$25,606. Page 1 d 3 The net total cost for all proposed compensation and benefit changes for the General Manager is not to exceed $41,107. PRIOR COMMITTEE/BOARD ACTIONS August 2015 — Board authorized the Chair to initiate discussions with the General Manager regarding his compensation and benefits package in closed session. June 2015 — Steering Committee conducted the annual performance evaluation of the General Manager in closed session. November 2014 — Board approved Resolution No. OCSD 14-15, approving a base building salary increase for the General Manager of 3% of salary and to adjust the corresponding salary range by 3% for FY 2014-2015, effective July 11, 2014. June 2014 — Steering Committee conducted the annual performance evaluation of the General Manager in closed session. February 2013 — Board approved appointment of James D. Herberg to the position of General Manager and approved the current compensation and benefits package, effective April 1, 2013. ADDITIONAL INFORMATION The General Manager provides leadership, strategic direction, and organizational oversight at OCSD. This position serves as the chief executive officer, and it is integral and critical to the success of the agency. During the past year, under the direction of the General Manager, the Sanitation District completed significant goals as set forth by the Board of Directors, including: • Reduced planned user fee increases; • Reaffirmed AAA credit ratings; • Paid down unfunded retirement liabilities, resulting in $6 million of annual savings; • $75 million in other operations savings identified over the next ten-year forecasting period; • No staff increases; • No additional debt; • Secured a $450,000 grant for future water recycling study; • Ceased bleach disinfection of our effluent saving $425,000 per year; • Completed phase 1 of the Newport Forcemain Replacement Project; • Increased flows to GWRS by 30% to 130 mgd; • Achieved labor agreements with bargaining units; • Relocation of Santa Ana River Interceptor from the flood plain (by County of Orange); and • Received numerous national awards including NAWCA Peak Performance Award for 100% compliance, US top 10 Fleets, Budget and Procurement Awards, WEF Plant Safety Award, to name a few. Page 2 d 3 The current At-Will Employment Agreement for General Manager James D. Herberg became effective July 1, 2014. The General Manager's current annual base salary is $221,449. Annually, the Steering Committee makes its recommendation to the Board concerning adjustments to the General Manager's compensation package. Section 6 of the At-Will Employment Agreement specifies the following: "District's Steering Committee shall meet with General Manager in August of each year during the term of this Agreement to review and evaluate his performance over the prior year. The Steering Committee shall make its recommendation(s) to the Board concerning adjustment to the compensation and/or benefits paid or provided to General Manager, to be effective in July of the year of review. After consideration of the recommendation(s) of the Steering Committee, the Board shall determine and approve the compensation, including benefits, payable to General Manager, which generally becomes effective July of the fiscal year of the review." OCSD is committed to maintaining a competitive compensation market position that attracts and retains top employment talent. It is OCSD's philosophy to compensate employees competitively and equitably, and understanding the relative market position assists in that determination. The proposed base building salary increase effective July 2015 will ensure OCSD maintains a competitive compensation market position to continue to attract and retain this critical positions. The proposed benefits package would include those benefits offered to represented and unrepresented employees, including medical, dental, vision, disability insurance and paid leave. The General Manager's benefits package also will include additional life insurance coverage at two times (2x) salary, auto allowance, 6% plus $1,250 investment incentive salary (IIS), and a $5,000 employer-paid 457(b) deferred compensation contribution. CEQA N/A BUDGET/PURCHASING ORDINANCE COMPLIANCE The funds for this increase were included in the OCSD Operating Budget for FY 2015- 2016. ATTACHMENTS • Resolution No. OCSD 15-23 • General Manager Pay Table, July 2014 • Proposed General Manager Pay Table, July 2015 Page 3 of 3 ITEM NO. 17 MINUTES OF THE LEGISLATIVE AND PUBLIC AFFAIRS COMMITTEE Orange County Sanitation District Monday, November 9, 2015, at 8:00 a.m. A motion was made by Director Kring and seconded by Director Diep to appoint Director Beamish to serve as Interim Chairman. A regular meeting of the Legislative and Public Affairs Committee was called to order by Interim Chair Beamish on Monday, November 9, 2015 at 8:05 a.m., in the Administration Building of the Orange County Sanitation District. Director Diep led the pledge of allegiance. A quorum was declared present, as follows: COMMITTEE MEMBERS PRESENT: STAFF PRESENT: Tyler Diep, Director Jim Herberg, General Manager John Nielsen, Board Chair Celia Chandler, Director of Human Tom Beamish, Director Resources Robert Kiley, Director Nick Arhontes, Director of Facilities Lucille Kring, Director Support Services John Withers, Director Rob Thompson, Director of Engineering Ed Torres, Director of Operations and COMMITTEE MEMBERS ABSENT: Maintenance Greg Sebourn, Board Vice-Chair Lorenzo Tyner, Director of Finance & Administrative Services Kelly Lore, Clerk of the Board Jennifer Cabral Jim Colston Al Garcia Rebecca Long Kelly Newell Eric Sirjord Nina Tran OTHERS PRESENT: Brad Hogin, General Counsel Eric Sapirstein, ENS (via Teleconference) Eric O'Donnell, Townsend Public Affairs Cori Williams, Townsend Public Affairs Adam Link, CASA 11/09/2015 Legislative and Public Affairs Committee Minutes Page 1 of4 PUBLIC COMMENTS: None. REPORTS: The Committee Chair and the General Manager may present verbal reports on miscellaneous matters of general interest to the Committee Members. These reports are for information only and require no action by the Committee. None. CONSENT CALENDAR: Consent Calendar Items are considered to be routine and willbe enacted, by the Board of Directors, after one motion, without discussion. Any items withdrawn from the Consent Calendar for separate discussion will be considered in the regular order of business. 1. APPROVAL OF MINUTES (Clerk of the Board) MOVED, SECONDED and DULY CARRIED TO: Approve minutes for the Committee meeting held on October 12, 2015. AYES: Beamish, Diep, Kiley, Kring, and Withers NOES: None ABSTENTIONS: None ABSENT: Nielsen and Sebourn Chair Nielsen arrived at 8:09 a.m, and presided. INFORMATION ITEMS: 2. PUBLIC AFFAIRS UPDATE (Jennifer Cabral) Principal Public Affairs Specialist, Jennifer Cabral provided an update on Public Affairs community education outreach for the month, and showed photos of the Placentia Heritage Festival and the Los Alamitos Wheels,Wings& Rotors events attended. She also notified the committee that an informational item regarding Public Affairs and Community outreach will be presented at upcoming Operations and Administration Committee meetings. Ms. Cabral stated that a request for OCSD to man a booth at the OC Fair had previously been made; and that after research was completed, staff found that the extensive amount of volunteer time (400 hours, 2 week period)and resources needed for an event this large was not recommended. 11/09/2015 Legislative and Public Affairs Committee Minutes Page 2 of 4 3. LEGISLATIVE UPDATE (Rebecca Long) Senior Public Affairs Specialist, Rebecca Long updated the committee on the State of the District event held on October 16°i and Senator Janet Nguyen's tour on October 28th and further stated that she is now a member of the State CASA Committee. Eric Sapirstein, ENS Resources, provided an informative presentation regarding: new Speaker of the House Paul Ryan and his pledge to have an open process for legislation consideration; the FY 2016 budget process, including a two-year budget agreement reached; tax reform; water infrastructure funding; climate change issues; funding priorities; spending limits, including the 80 to 85 billion in new spending and the allocations; and issues with current year spending bills. Mr. Sapirstein also provided information regarding: Emergency Drought bill challenges and announced that Joel Beauvais will serve as acting Assistant Administrator of the USEPA, who's area of priority is climate change issues. Mr. Sapirstein then answered questions from the committee regarding: funding for storage and distribution of water, additional water recycling and alternative energy production and innovation; funding assistance and challenges for desalination projects; and the possibility of a scaled back drought bill due to the probability of El Nino. Cori Williams, Townsend Public Affairs, reported on the continued work of the Transportation Infrastructure Conference Committee Special Session and the considered funding proposals. Ms. Williams stated that California continued to reduce water usage by 26% in September, and stated that the emergency water conservation regulations that will expire in February 2016, will be evaluated and reconsidered by the State Water Resources Control Board at a Public Workshop on December 7. Ms. Williams further stated that for FY 2016, there are five measures that qualified for initiatives or referendum on the ballot; one which will require voter approval for Public Works projects which mandate over 2 billion in revenue bonds, is of most importance to the District. Eric O'Donnell, Townsend Public Affairs, reported on the IRWM funding approval and the future actions that will be taken. He also reported that he had met with Senator Herzberg's office regarding SB163 and recommends sending position letters to the Senator. Mr. O'Donnell is also working on setting up a meeting with the Senator at his Van Nuys office in early December and scheduling a tour of OCSD in February. 11/09/2015 Legislative and Public Affairs Committee Minutes Page 3 of 4 4. CALIFORNIA ASSOCIATION OF SANITATION AGENCIES LEGISLATIVE PLATFORM (Jennifer Cabral) Ms. Cabral introduced Adam Link Director of Affairs for CASA who provided an informative PowerPoint presentation regarding: CASA sponsored legislation and priority issues in 2015; state and federal legislative priorities for 2016; anticipated legislation; issues of significance; fellow associations; and CASA initiatives and upcoming events. Mr. Link responded to questions from the committee regarding: the makeup of the CASA legislative committees; and California "Duck Curve", solar power system peaks and excess energy issues. NON-CONSENT CALENDAR: None. OTHER BUSINESS AND COMMUNICATIONS OR SUPPLEMENTAL AGENDA ITEMS, IF ANY: General Manager Jim Herberg announced that OCSD Administrative Offices will be closed on Wednesday, November 111h in observance of Veterans Day. Director Kring announced that the City of Anaheim will be hosting a Veterans Day event at the Muzeo with a special commemoration of the Marine Corps 2401h birthday. ADJOURNMENT: Chair Nielsen declared the meeting adjourned at 9:14 a.m. to the next Legislative and Public Affairs Committee Meeting, December 14, 2015 at 8:00 a.m. Submitted by: Kelly A. Lore Clerk of the Board 11/09/2015 Legislative and Public Affairs Committee Minutes Page 4 of BOARD OF DIRECTORS Meeting Date To ad.Of Dir. 11/te/IS AGENDA REPORT Item Number Item Number - to Orange County Sanitation District FROM: James D. Herberg, General Manager Originator: Rob Thompson, Director of Engineering SUBJECT: PLANT 2 TRICKLING FILTER ODOR CONTROL SYSTEM UPGRADE, PROJECT NO. FE13-04 GENERAL MANAGER'S RECOMMENDATION A. Receive and file bid tabulation and recommendation; B. Award a construction contract to Kiewit Infrastructure West Co. for Plant 2 Trickling Filter Odor Control System Upgrade, Project No. FE13-04, for a total amount not to exceed $2,514,000; and C. Approve a contingency of$251,400 (10%). SUMMARY The Orange County Sanitation District (Sanitation District) has received frequent odor complaints from neighbors near Treatment Plant 2 in Huntington Beach. After conducting analyses and physical observations, it was determined that much of the odor was originating from the trickling filter process area. To minimize odor complaints, the Sanitation District is required to replace the trickling filter scrubber carbon media every two months. The installation of chemical scrubbers at the trickling filters will eliminate or reduce the frequency of carbon media replacement and mitigate the nuisance odors reaching the neighbors. This project is consistent with the Sanitation District's goal to be a good neighbor. The project constructs three chemical scrubber systems and a sodium hypochlorite feed system to treat the foul air from existing Trickling Filters A, B, and C. Each chemical scrubber system includes a foul air fan, foul air chemical scrubber, demisters, and ductwork. The Sanitation District advertised for bids on August 12, 2015. Seven sealed bids were received on September 24, 2015. The bids were evaluated in accordance with the Sanitation District's policies and procedures. Staff recommends awarding a construction contract to the lowest responsive bidder, Kiewit Infrastructure West Co., for Plant 2 Trickling Filter Odor Control System Upgrade, Project No. FE13-04. Page 1 of 2 Summary information on the bid opening for Plant 2 Trickling Filter Odor Control System Upgrade, Project No. FE13-04, is as follows: Project Budget $3,545,960 Construction Contract Budget $2,600,000 Engineer's Estimate $2,581,000 Bidder Amount of Bid Kiewit Infrastructure West Co. $2,514,000 Cora Constructors, Inc. $2,556,861 Tharsos, Inc. $2,557,000 ODC Engineering &Technology $2,695,000 Pyramid Building & Engineering, Inc. $2,709,860 JF Shea Construction, Inc. $2,945,971 Shimmick Construction Co., Inc. $3,019,000 PRIOR COMMITTEE/BOARD ACTIONS N/A ADDITIONAL INFORMATION N/A CEQA A Notice of Exemption was filed and recorded with the County of Orange on August 20, 2014. BUDGET/PURCHASING ORDINANCE COMPLIANCE This request complies with authority levels of the Sanitation District's Purchasing Ordinance. This item has been budgeted (Line item: Budget Update, FY2015-16, Page A-11). Project contingency funds will not be used for this construction contract. ATTACHMENT The following attachment(s) maybe viewed on-line at the OCSD website (www.ocsd.com) with the complete agenda package: • Construction Contract RB:dm:gc Page 2 of 2 PART A CONTRACT AGREEMENT C-CA-121914 TABLE OF CONTENTS CONTRACT AGREEMENT SECTION- 1 GENERAL CONDITIONS.................................................................1 SECTION-2 MATERIALS AND LABOR................................................................4 SECTION-3 PROJECT ........................................................................................4 SECTION -4 PLANS AND SPECIFICATONS........................................................5 SECTION -5 TIME OF COMMENCEMENT AND COMPLETION..........................5 SECTION -6 TIME IS OF THE ESSENCE ............................................................5 SECTION -7 EXCUSABLE DELAYS.....................................................................6 SECTION -8 EXTRA WORK.................................................................................6 SECTION -9 CHANGES IN PROJECT..................................................................7 SECTION - 10 LIQUIDATED DAMAGES FOR DELAY............................................7 SECTION - 11 CONTRACT PRICE AND METHOD OF PAYMENT.........................7 SECTION - 12 SUBSTITUTION OF SECURITIES IN LIEU OF RETENTION OF FUNDS.............................................................................................9 SECTION - 13 COMPLETION................................................................................10 SECTION - 14 CONTRACTOR'S EMPLOYEES COMPENSATION.......................10 SECTION - 15 SURETY BONDS...........................................................................12 SECTION - 16 INSURANCE..................................................................................13 SECTION - 17 RISK AND INDEMNIFICATION......................................................21 SECTION - 18 TERMINATION...............................................................................21 SECTION- 19 WARRANTY...................................................................................21 SECTION-20 ASSIGNMENT................................................................................22 SECTION-21 RESOLUTION OF DISPUTES........................................................22 SECTION-22 SAFETY& HEALTH.......................................................................23 SECTION-23 NOTICES.......................................................................................23 C-CA-121914 CONTRACT AGREEMENT ORANGE COUNTY SANITATION DISTRICT PROJECT NO. FE13-04 PLANT 2 TRICKLING FILTER ODOR CONTROL SYSTEM UPGRADE THIS AGREEMENT is made and entered into, to be effective, this November 18, 2015, by and between Kiewit Infrastructure West Company, hereinafter referred to as "CONTRACTOR" and the Orange County Sanitation District, hereinafter referred to as "OCSD". WITNESSETH That for and in consideration of the promises and agreements hereinafter made and exchanged, OCSD and CONTRACTOR agree as follows: SECTION- 1 GENERAL CONDITIONS CONTRACTOR certifies and agrees that all the terms, conditions and obligations of the Contract Documents as hereinafter defined, the location of the job site, and the conditions under which the Work is to be performed have been thoroughly reviewed, and enters into this Contract based upon CONTRACTOR's investigation of all such matters and is in no way relying upon any opinions or representations of OCSD. It is agreed that this Contract represents the entire agreement. It is further agreed that the Contract Documents are each incorporated into this Contract by reference, with the same force and effect as if the same were set forth at length herein, and that CONTRACTOR and its Subcontractors, if any, will be and are bound by any and all of said Contract Documents insofar as they relate in any part or in any way, directly or indirectly, to the Work covered by this Contract. A. Contract Documents Order of Precedence "Contract Documents" refers to those documents identified in the definition of"Contract Documents" in the General Conditions— Definitions. C-CA-121914 W 1 JOBCONTRACT NOD aM 5 JOBCONTRACT TITLE. CONFORMED Page 1 of 25 1. In the event of a conflict between one Contract Document and any of the other Contract Documents, the provisions in the document highest in precedence shall be controlling. The order of precedence of the Contract Documents is as follows: a. Supplemental Agreements—the last in time being the first in precedence b. Addenda issued prior to opening of Bids—the last in time being the first in precedence c. Contract Agreement d. Permits and other regulatory requirements e. Special Provisions f. General Conditions (GC) g. Notice Inviting Bids and Instruction to Bidders h. Geotechnical Baseline Report(GBR), if attached as a Contract Document I. Plans and Specifications—in these documents the order of precedence shall be: i. Specifications (Divisions 01-17) L Plans iii. General Requirements (GR) iv. Standard Drawings and Typical Details j. CONTRACTOR's Bid 2. In the event of a conflict between terms within an individual Contract Document, the conflict shall be resolved by applying the following principles as appears applicable: a. Figured dimensions on the Contract Documents shall govern. Dimensions not specified shall be as directed by the ENGINEER. Details not shown or specified shall be the same as similar parts that are shown or specified, or as directed. Full-size details shall take precedence over scale Drawings as to C-CA-121914 xM 1 JOBCONTRACT NO. «M 5 JOBCONTRACT TITLE. CONFORMED Page 2 of 25 shape and details of construction. Specifications shall govern as to material and workmanship. b. The Contract Documents calling for the higher quality material or workmanship shall prevail. Materials or Work described in words, which so applied, have a well known technical or trade meaning shall be deemed to refer to such recognized standards. In the event of any discrepancy between any Drawings and the figures thereon, the figures shall be taken as correct. C. Scale Drawings, full-size details, and Specifications are intended to be fully complementary and to agree. Should any discrepancy between Contract Documents come to the CONTRACTOR's attention, or should an error occur in the efforts of others, which affect the Work, the CONTRACTOR shall notify the ENGINEER, in writing, at once. In the event any doubts or questions arise with respect to the true meaning of the Contract Documents, reference shall be made to the ENGINEER whose written decision shall be final. If the CONTRACTOR proceeds with the Work affected without written instructions from the ENGINEER, the CONTRACTOR shall be fully responsible for any resultant damage or defect. d. Anything mentioned in the Specifications and not indicated in the Plans, or indicated in the Plans and not mentioned in the Specifications, shall be of like effect as if indicated and mentioned in both. In case of discrepancy in the Plans or Specifications, the matter shall be immediately submitted to OCSD's ENGINEER, without whose decision CONTRACTOR shall not adjust said discrepancy save only at CONTRACTOR's own risk and expense. The decision of the ENGINEER shall be final. C-CA-121914 W 1 JOBCONTRACT NOD aM 5 JOBCONTRACT TITLE. CONFORMED Page 3 of 25 In all matters relating to the acceptability of material, machinery or plant equipment; classifications of material or Work; the proper execution, progress or sequence of the Work; and quantities interpretation of the Contract Documents, the decision of the ENGINEER shall be final and binding, and shall be a condition precedent to any payment under the Contract, unless otherwise ordered by the Board of Directors. B. Definitions Capitalized terms used in this Contract are defined in the General Conditions, Definitions. Additional terms may be defined in the Special Provisions. SECTION—2 MATERIALS AND LABOR CONTRACTOR shall furnish, under the conditions expressed in the Plans and Specifications, at CONTRACTOR'S own expense, all labor and materials necessary, except such as are mentioned in the Specifications to be furnished by OCSD, to construct and complete the Project, in good workmanlike and substantial order. If CONTRACTOR fails to pay for labor or materials when due, OCSD may settle such claims by making demand upon the Surety to this Contract. In the event of the failure or refusal of the Surety to satisfy said claims, OCSD may settle them directly and deduct the amount of payments from the Contract Price and any amounts due to CONTRACTOR. In the event OCSD receives a stop payment notice from any laborer or material supplier alleging non-payment by CONTRACTOR, OCSD shall be entitled to deduct all of its costs and expenses incurred relating thereto, including but not limited to administrative and legal fees. SECTION —3 PROJECT The Project is described as: PROJECT NO. FE13-04 PLANT 2 TRICKLING FILTER ODOR CONTROL SYSTEM UPGRADE C-CA-121914 xM 1 JOBCONTRACT NO. xM 5 JOBCONTRACT TITLE. CONFORMED Page 4 of 25 SECTION-4 PLANS AND SPECIFICATONS The Work to be done is shown in a set of Plans and Specifications entitled: PROJECT NO. FE13-04 PLANT 2 TRICKLING FILTER ODOR CONTROL SYSTEM UPGRADE Said Plans and Specifications and any revision, amendments and addenda thereto are attached hereto and incorporated herein as part of this Contract and referred to by reference. SECTION—5 TIME OF COMMENCEMENT AND COMPLETION CONTRACTOR agrees to commence the Project within fifteen (15) calendar days from the date set forth in the "Notice to Proceed" sent by OCSD, unless otherwise specified therein and shall diligently prosecute the Work to completion within four hundred ninelylhree (493)calendar days from the effective date of the"Notice to Proceed" issued by OCSD, excluding delays caused or authorized by OCSD as set forth in Sections 7, 8, and 9 hereof, and applicable provisions in the General Conditions. The time for completion includes ten (10) calendar days determined by OCSD likely to be inclement weather when CONTRACTOR will be unable to work. In addition, CONTRACTOR shall accomplish such milestones within the periods of performance set forth in Appendix A of the Special Provisions entitled "Work Completion Schedule." SECTION —6 TIME IS OF THE ESSENCE Time is of the essence of this Contract. As required by the Contract Documents, CONTRACTOR shall prepare and obtain approval of all shop drawings, details and samples, and do all other things necessary and incidental to the prosecution of CONTRACTOR's Work in conformance with an approved construction progress schedule. CONTRACTOR shall coordinate the Work covered by this Contract with that of all other contractors, subcontractors and of OCSD, in a manner that will facilitate the efficient completion of the entire Work and accomplish the required milestone(s), if any, by the applicable deadline(s) in accordance with Section 5 herein. OCSD shall have the right to assert complete control of the premises on C-CA-121914 W 1 JOBCONTRACT NOD aM 5 JOBCONTRACT TITLE. CONFORMED Page 5 of 25 which the Work is to be performed and shall have the right to decide the time or order in which the various portions of the Work shall be installed or the priority of the Work of Subcontractors, and, in general, all matters representing the timely and orderly conduct of the Work of CONTRACTOR on the premises. SECTION—7 EXCUSABLE DELAYS CONTRACTOR shall only be excused for any delay in the prosecution or completion of the Project as specifically provided in General Conditions, "Extensions for Delay", and the General Requirements, "By CONTRACTOR or Others— Unknown Utilities during Contract Work". Extensions of time and extra compensation arising from such excusable delays will be determined in accordance with the General Conditions, "Extension of Time for Delay" and "Contract Price Adjustments and Payments", and extensions of time and extra compensation as a result of incurring undisclosed utilities will be determined in accordance with General Requirements, "By CONTRACTOR or Others— Unknown Utilities during Contract Work". OCSD's decision will be conclusive on all parties to this Contract. SECTION—S EXTRA WORK The Contract Price as set forth in Section 11, includes compensation for all Work performed by CONTRACTOR, unless CONTRACTOR obtains a Change Order signed by a designated representative of OCSD specifying the exact nature of the Extra Work and the amount of extra compensation to be paid all as more particularly set forth in Section 9 hereof and the General Conditions, "Request for Change (Changes at CONTRACTOR's Request)", "OWNER Initiated Changes", and "Contract Price Adjustments and Payments". In the event a Change Order is issued by OCSD pursuant to the Contract Documents, OCSD shall extend the time fixed in Section 5 for completion of the Project by the number of days, if C-CA-121914 xM 1 JOBCONTRACT NO. xM 5 JOBCONTRACT TITLE. CONFORMED Page 6 of 25 any, reasonably required for CONTRACTOR to perform the Extra Work, as determined by the ENGINEER. The decision of the ENGINEER shall be final. SECTION—9 CHANGES IN PROJECT OCSD may at any time, without notice to any Surety, by Change Order, make any changes in the Work within the general scope of the Contract Document, including but not limited to changes: 1. In the Specifications (including Drawings and designs); 2. In the time, method or manner of performance of the Work; 3. In OCSD-furnished facilities, equipment, materials, services or site; or 4. Directing acceleration in the performance of the Work. No change of period of performance or Contract Price, or any other change in the Contract Documents, shall be binding until the Contract is modified by a fully executed Change Order. All Change Orders shall be issued in accordance with the requirements set forth in the General Conditions, "Request for Change (Changes at CONTRACTOR's Request)"and "OWNER Initiated Changes". SECTION — 10 LIQUIDATED DAMAGES FOR DELAY Liquidated Damages shall be payable in the amounts and upon the occurrence of such events or failure to meet such requirements or deadlines as provided in the Special Provisions, "Liquidated Damages and Incentives." SECTION — 11 CONTRACT PRICE AND METHOD OF PAYMENT A. OCSD agrees to pay and the CONTRACTOR agrees to accept as full consideration for the faithful performance of this Contract, subject to any additions or deductions as provided in approved Change Orders, the sum of Two Million Five Hundred Fourteen Thousand Dollars ($2,514,000) as itemized on the Attached Exhibit"A". C-CA-121914 W 1 JOBCONTRACT NOD aM 5 JOBCONTRACT TITLE. CONFORMED Page 7 of 25 Upon satisfaction of the conditions precedent to payment set forth in the General Requirements, Additional General Requirements and General Conditions (including but not limited to Sections entitled "Mobilization Payment Requirements" and "Payment Itemized Breakdown of Contract Lump Sum Prices"), there shall be paid to the CONTRACTOR an initial Net Progress Payment for mobilization. OCSD shall issue at the commencement of the job a schedule which shows: 1. A minimum of one (1) payment to be made to the CONTRACTOR for each successive four(4)week period as the Work progresses, and 2. The due dates for the CONTRACTOR to submit requests for payment to meet the payment schedule. After the initial Net Progress Payment, and provided the CONTRACTOR submits the request for payment prior to the end of the day required to meet the payment schedule, the CONTRACTOR shall be paid a Net Progress Payment on the corresponding monthly payment date set forth in the schedule. Payments shall be made on demands drawn in the manner required by law, accompanied by a certificate signed by the ENGINEER, stating that the Work for which payment is demanded has been performed in accordance with the terms of the Contract Documents, and that the amount stated in the certificate is due under the terms of the Contract. Payment applications shall also be accompanied with all documentation, records, and releases as required by the Contract, Exhibit A, Schedule of Prices, and General Conditions, "Payment for Work—General". The total amount of Progress Payments shall not exceed the actual value of the Work completed as certified by the ENGINEER. The processing of payments shall not be considered as an acceptance of any part of the Work. C-CA-121914 xM 1 JOBCONTRACT NO. xM 5 JOBCONTRACT TITLE. CONFORMED Page 8 of 25 B. As used in this Section, the following defined terms shall have the following meanings: 1. "Net Progress Payment' means a sum equal to the Progress Payment less the Retention Amount and other qualified deductions (Liquidated Damages, stop payment notices, etc.). 2. `Progress Payment' means a sum equal to: a. the value of the actual Work completed since the commencement of the Work as determined by OCSD; b. plus the value of material suitably stored at the worksite, treatment plant or approved storage yards subject to or under the control of OCSD since the commencement of the Work as determined by OCSD; C. less all previous Net Progress Payments; d. less all amounts of previously qualified deductions; e. less all amounts previously retained as Retention Amounts. 3. "Retention Amount'for each Progress Payment means the percentage of each Progress Payment to be retained by OCSD to assure satisfactory completion of the Contract. The amount to be retained from each Progress Payment shall be determined as provided in the General Conditions—'Retained Funds; Substitution of Securities." SECTION — 12 SUBSTITUTION OF SECURITIES IN LIEU OF RETENTION OF FUNDS Pursuant to Public Contract Code Section 22300 at seq., the CONTRACTOR may, at its sole expense, substitute securities as provided in General Conditions—"Retained Funds; Substitution of Securities." C-CA-121914 W 1 JOBCONTRACT NOD aM 5 JOBCONTRACT TITLE. CONFORMED Page 9 of 25 SECTION- 13 COMPLETION Final Completion and Final Acceptance shall occur at the time and in the manner specified in the General Conditions, "Final Acceptance and Final Completion", "Final Payment"and Exhibit A- Schedule of Prices. Upon receipt of all documentation, records, and releases as required by the Contract from the CONTRACTOR, OCSD shall proceed with the Final Acceptance as specified in General Conditions. SECTION - 14 CONTRACTOR'S EMPLOYEES COMPENSATION A. Davis-Bacon Act: CONTRACTOR will pay and will require all Subcontractors to pay all employees on said Project a salary or wage at least equal to the prevailing rate of per diem wages as determined by the Secretary of Labor in accordance with the Davis-Bacon Act for each craft or type of worker needed to perform the Contract. The provisions of the Davis-Bacon Act shall apply only if the Contract is in excess of Two Thousand Dollars ($2,000.00) and when twenty-five percent(25%) or more of the Contract is funded by federal assistance. If the aforesaid conditions are met, a copy of the provisions of the Davis-Bacon Act to be complied with are incorporated herein as a part of this Contract and referred to by reference. B. General Prevailing Rate: OCSD has been advised by the State of California Director of Industrial Relations of its determination of the general prevailing rate of per diem wages and the general prevailing rate for legal holiday and overtime Work in the locality in which the Work is to be performed for each craft or type of Work needed to execute this Contract, and copies of the same are on file in the Office of the ENGINEER of OCSD. The CONTRACTOR C-CA-121914 xM 1 JOBCONTRACT NO. xM 5 JOBCONTRACT TITLE. CONFORMED Page 10 of 25 agrees that not less than said prevailing rates shall be paid to workers employed on this public works Contract as required by Labor Code Section 1774 of the State of California. Per California Labor Code 1773.2, OCSD will have on file copies of the prevailing rate of per diem wages at its principal office and at each job site, which shall be made available to any interested party upon request. C. Forfeiture for Violation: CONTRACTOR shall, as a penalty to OCSD, forfeit Two Hundred Dollars ($200.00)for each calendar day or portion thereof for each worker paid (either by the CONTRACTOR or any Subcontractor under it) less than the prevailing rate of per diem wages as set by the Director of Industrial Relations, in accordance with Sections 1770-1780 of the California Labor Code for the Work provided for in this Contract, all in accordance with Section 1775 of the Labor Code of the State of California. D. Apprentices: Sections 1777.5, 1777.6, 1777.7 of the Labor Code of the State of California, regarding the employment of apprentices are applicable to this Contract and the CONTRACTOR shall comply therewith K the prime Contract involves Thirty Thousand Dollars ($30,000.00) or more. E. Workday: In the performance of this Contract, not more than eight(8) hours shall constitute a day's work, and the CONTRACTOR shall not require more than eight(8) hours of labor in a day from any person employed by it hereunder except as provided in paragraph (B)above. CONTRACTOR shall conform to Article 3, Chapter 1, Part 7 (Section 1810 at seg.) of the Labor Code of the State of California and shall forfeit to OCSD as a penalty, the sum of Twenty-five Dollars ($25.00)for each worker employed in the execution of this Contract by CONTRACTOR or any Subcontractor for each calendar day during which any worker is C-CA-121914 W 1 JOBCONTRACT NOD aM 5 JOBCONTRACT TITLE. CONFORMED Page 11 of 25 required or permitted to labor more than eight (8) hours in any one (1) calendar day and forty (40) hours in any one (1)week in violation of said Article. CONTRACTOR shall keep an accurate record showing the name and actual hours worked each calendar day and each calendar week by each worker employed by CONTRACTOR in connection with the Project. F. Registration: Record of Wages: Inspection: CONTRACTOR shall comply with the registration requirements of Labor Code Section 1725.5. Pursuant to Labor Code Section 1771.4, the Work is subject to compliance monitoring by the California Department of Industrial Relations. CONTRACTOR shall maintain accurate payroll records and shall submit payroll records to the Labor Commissioner pursuant to Labor Code Section 1771.4(a)(3). Penalties for non-compliance with the requirements of Section 1776 may be deducted from progress payments per Section 1776. CONTRACTOR shall comply with the job site notices posting requirements established by the Labor Commissioner per Title 8, California Code of Regulations Section 16461(a). SECTION — 15 SURETY BONDS CONTRACTOR shall, before entering upon the performance of this Contract,furnish Bonds approved by OCSD's General Counsel—one in the amount of one hundred percent(100%) of the Contract amount, to guarantee the faithful performance of the Work, and the other in the amount of one hundred percent (100%) of the Contract amount to guarantee payment of all claims for labor and materials furnished. As changes to the Contract occur via approved Change Orders, the CONTRACTOR shall assure that the amounts of the Bonds are adjusted to maintain one hundred percent (100%)of the Contract Price. This Contract shall not become effective until such Bonds are supplied to and approved by OCSD. Bonds must be issued by a Surety authorized by the State Insurance Commissioner to do business in California. The Performance Bond shall remain in full force and effect through the warranty period, as specified C-CA-121914 xM 1 JOBCONTRACT NO. xM 5 JOBCONTRACT TITLE. CONFORMED Page 12 of 25 in Section 19 below. All Bonds required to be submitted relating to this Contract must comply with California Code of Civil Procedure Section 995.630. Each Bond shall be executed in the name of the Surety insurer under penalty of perjury, or the fact of execution of each Bond shall be duly acknowledged before an officer authorized to take and certify acknowledgments, and either one of the following conditions shall be satisfied: A. A copy of the transcript or record of the unrevoked appointment, power of attorney, by- laws, or other instrument, duly certified by the proper authority and attested by the seal of the insurer entitling or authorizing the person who executed the Bond to do so for and on behalf of the insurer, is on file in the Office of the County Clerk of the County of Orange; or B. A copy of a valid power of attorney is attached to the Bond. SECTION — 16 INSURANCE CONTRACTOR shall purchase and maintain, for the duration of the Contract, insurance against claims for injuries to persons, or damages to property which may arise from or in connection with the performance of the Work hereunder, and the results of that Work by CONTRACTOR, its agents, representatives, employees, or Subcontractors, in amounts equal to the requirements set forth below. CONTRACTOR shall not commence Work under this Contract until all insurance required under this section is obtained in a form acceptable to OCSD, nor shall CONTRACTOR allow any Subcontractor to commence Work on a subcontract until all insurance required of the Subcontractor has been obtained. CONTRACTOR shall maintain all of the foregoing insurance coverages in force through the point at which the Work under this Contract is fully completed and accepted by OCSD pursuant to the provisions of the General Conditions, "Final Acceptance and Final Completion". Furthermore, CONTRACTOR shall maintain all of the foregoing insurance coverages in full force and effect throughout the warranty period, commencing on the date of Final Acceptance. The requirement for carrying the foregoing insurance shall not derogate from the provisions for indemnification of OCSD by C-CA-121914 W 1 JOBCONTRACT NOD aM 5 JOBCONTRACT TITLE. CONFORMED Page 13 of 25 CONTRACTOR under Section 17 of this Contract. Notwithstanding nor diminishing the obligations of CONTRACTOR with respect to the foregoing, CONTRACTOR shall subscribe for and maintain in full force and effect during the life of this Contract, inclusive of all changes to the Contract Documents made in accordance with the provisions of the General Conditions, "Request for Change (Changes at CONTRACTOR's Request)" and/or"OWNER Initiated Changes", the following insurance in amounts not less than the amounts specified. OCSD reserves the right to amend the required limits of insurance commensurate with the CONTRACTOR's risk at any time during the course of the Project. No vehicles may enter OCSD premises/worksite without possessing the required insurance coverage. CONTRACTOR's insurance shall also comply with all insurance requirements prescribed by agencies from whom permits shall be obtained for the Work and any other third parties from whom third party agreements are necessary to perform the Work(collectively, the "Third Parties"), The Special Provisions may list such requirements and sample forms and requirements from such Third Parties may be included in an attachment to the General Requirements. CONTRACTOR bears the responsibility to discover and comply with all requirements of Third Parties, including meeting specific insurance requirements, that are necessary for the complete performance of the Work. To the extent there is a conflict between the Third Parties' insurance requirements and those set forth by OCSD herein, the requirement(s) providing the more protective coverage for both OSCD and the Third Parties shall control and be purchased and maintained by CONTRACTOR. A. Limits of Insurance 1. General Liability: Five Million Dollars ($5,000,000) per occurrence and a general aggregate limit of Five Million Dollars ($5,000,000)for bodily injury, personal injury and property damage. Coverage shall include each of the following: a. Premises-Operations. C-CA-121914 xM 1 JOBCONTRACT NO. xM 5 JOBCONTRACT TITLE. CONFORMED Page 14 of 25 b. Products and Completed Operations, with limits of at least Five Million Dollars ($5,000,000) per occurrence and a general aggregate limit of Five Million Dollars ($5,000,000)which shall be in effect at all times during the warranty period set forth in the Warranty section herein, and as set forth in the General Conditions, "Warranty(CONTRACTOR's Guarantee)", plus any additional extension or continuation of time to said warranty period that may be required or authorized by said provisions. C. Broad Form Property Damage, expressly including damage arising out of explosion, collapse, or underground damage. d. Contractual Liability, expressly including the indemnity provisions assumed under this Contract. e. Separation of Insured Clause, providing that coverage applies separately to each insured, except with respect to the limits of liability. f. Independent CONTRACTOR's Liability. To the extent first dollar coverage, including defense of any claim, is not available to OCSD or any other additional insured because of any SIR, deductible, or any other form of self insurance, CONTRACTOR is obligated to assume responsibility of insurer until the deductible, SIR or other condition of insurer assuming its defense and/or indemnity has been satisfied. CONTRACTOR shall be responsible to pay any deductible or SIR. g. If a crane will be used, the General Liability insurance will be endorsed to add Riggers Liability coverage or its equivalent to cover the usage of the crane and exposures with regard to the crane operators, riggers and others involved in using the crane. C-CA-121914 W 1 JOBCONTRACT NOD aM 5 JOBCONTRACT TITLE. CONFORMED Page 15 of 25 h. If divers will be used, the General Liability insurance will be endorsed to cover marine liability or its equivalent to cover the usage of divers. 2. Automobile Liability: The CONTRACTOR shall maintain a policy of Automobile Liability Insurance on a comprehensive form covering all owned, non-owned, and hired automobiles, trucks, and other vehicles providing the following minimum limits of liability coverage: Either(1)a combined single limit of One Million Dollars ($1,000,000) and a general aggregate limit of One Million Dollars ($1,000,000)for bodily injury, personal injury and property damage; Or alternatively, (2) One Million Dollars ($1,000,000) per person for bodily injury and One Million Dollars ($1,000,000) per accident for property damage. 3. Umbrella Excess Liability: The minimum limits of general liability and automobile liability insurance required, as set forth above, shall be provided for either in a single policy of primary insurance or a combination of policies of primary and umbrella excess coverage. Excess liability coverage shall be issued with limits of liability which, when combined with the primary insurance, will equal the minimum limits for general liability and automobile liability. 4. Workers Compensation/Employer's Liability: CONTRACTOR shall provide such Workers Compensation Insurance as required by the Labor Code of the State of California, including employers liability with a minimum limit of One Million Dollars ($1,000,000) per accident for bodily injury or disease. If an exposure to Jones Act liability may exist, the insurance required herein shall include coverage with regard to Jones Act claims. C-CA-121914 xM 1 JOBCONTRACT NO. xM 5 JOBCONTRACT TITLE. CONFORMED Page 16 of 25 Where permitted by law, CONTRACTOR hereby waives all rights of recovery by subrogation because of deductible clauses, inadequacy of limits of any insurance policy, limitations or exclusions of coverage, or any other reason against OCSD, its or their officers, agents, or employees, and any other contractor or subcontractor performing Work or rendering services on behalf of OCSD in connection with the planning, development and construction of the Project. In all its insurance coverages related to the Work, CONTRACTOR shall include clauses providing that each insurer shall waive all of its rights of recovery by subrogation against OCSD, its or their officers, agents, or employees, or any other contractor or subcontractor performing Work or rendering services at the Project. Where permitted by law, CONTRACTOR shall require similar written express waivers and insurance clauses from each of its Subcontractors of every tier. A waiver of subrogation shall be effective as to any individual or entity, even if such individual or entity (a)would otherwise have a duty of indemnification, contractual or otherwise, (b)did not pay the insurance premium, directly or indirectly, and (c)whether or not such individual or entity has an insurable interest in the property damaged. A. Limits are Minimums: If CONTRACTOR maintains higher limits than the minimums shown in this section, OCSD requires and shall be entitled to coverage for the higher limits maintained by the CONTRACTOR. B. Deductibles and Self-Insured Retentions Any deductibles or self-insured retentions must be declared to and approved by OCSD. At the option of OCSD, either: the Insurer shall reduce or eliminate such deductibles or self- insured retentions as respects OCSD, its Directors, officers, agents, CONSULTANTS, and employees; or CONTRACTOR shall provide a financial guarantee satisfactory to OCSD C-CA-121914 W 1 JOBCONTRACT NOD aM 5 JOBCONTRACT TITLE. CONFORMED Page 17 of 25 guaranteeing payment of losses and related investigations, claim administration, and defense expenses. C. Other Insurance Provisions 1. Each such policy of General Liability Insurance and Automobile Liability Insurance shall be endorsed to contain, the following provisions: a. OCSD, its Directors, officers, agents, CONSULTANTS, and employees, and all public agencies from whom permits will be obtained, and their Directors, officers, agents, and employees are hereby declared to be additional insureds under the terms of this policy, but only with respect to the operations of CONTRACTOR at or from any of the sites of OCSD in connection with this Contract, or acts and omissions of the additional insured in connection with its general supervision or inspection of said operations related to this Contract. b. Insurance afforded by the additional insured endorsement shall apply as primary insurance, and other insurance maintained by OCSD shall be excess only and not contributing with insurance provided under this policy. 2. Each insurance policy required herein shall be endorsed to state that coverage shall not be cancelled by either party, except after thirty (30)days prior written notice by certified mail, return receipt requested, and that coverage shall not be cancelled for non-payment of premium except after ten (10)days prior written notice by certified mail, return receipt requested. Should there be changes in coverage or an increase in deductible or SIR amounts, CONTRACTOR undertakes to procure a manuscript endorsement from its insurer giving thirty (30)days prior notice of such an event to OCSD, or to have its insurance broker/agent send to OCSD a certified letter describing the changes in coverage and any increase in deductible or SIR amounts. The certified letter must be sent Attention: Risk Management and shall be C-CA-121914 xM 1 JOBCONTRACT NO. xM 5 JOBCONTRACT TITLE. CONFORMED Page 18 of 25 received not less than twenty(20) days prior to the effective date of the change(s). The letter must be signed by a Director or Officer of the broker/agent and must be on company letterhead, and may be sent via e-mail in pdf format. 3. Coverage shall not extend to any indemnity coverage for the active negligence of any additional insured in any case where an agreement to indemnify the additional insured would be invalid under California Civil Code Section 2782(b). 4. If required by a public agency from whom permit(s) will be obtained, each policy of General Liability Insurance and Automobile Liability Insurance shall be endorsed to specify by name the public agency and its legislative members, officers, agents, CONSULTANTS, and employees, to be additional insureds. D. Acceptability of Insurers Insurers must have an "A-", or better, Policyholder's Rating, and a Financial Rating of at least Class Vill, or better, in accordance with the most current A.M. Best Rating Guide. OCSD recognizes that State Compensation Insurance Fund has withdrawn from participation in the A.M. Best Rating Guide process. Nevertheless, OCSD will accept State Compensation Insurance Fund for the required policy of worker's compensation insurance, subject to OCSD's option, at any time during the term of this Contract, to require a change in insurer upon twenty (20) days written notice. Further, OCSD will require CONTRACTOR to substitute any insurer whose rating drops below the levels herein specified. Said substitution shall occur within twenty (20)days of written notice to CONTRACTOR by OCSD or its agent. E. Verification of Coverage CONTRACTOR shall furnish OCSD with original certificates and mandatory endorsements affecting coverage. Said policies and endorsements shall conform to the requirements herein stated. All certificates and endorsements are to be received and approved by C-CA-121914 W 1 JOBCONTRACT NOD aM 5 JOBCONTRACT TITLE. CONFORMED Page 19 of 25 OCSD before Work commences. OCSD reserves the right to require complete, certified copies of all required insurance policies, including endorsements, affecting the coverage required by these Contract Documents at any time. F. Subcontractors CONTRACTOR shall be responsible to establish insurance requirements for any Subcontractors hired by CONTRACTOR. The insurance shall be in amounts and types reasonably sufficient to deal with the risk of loss involving the Subcontractor's operations and Work. OCSD and any public agency issuing permits for the Project must be named as "Additional Insured" on any General Liability or Automobile Liability policy obtained by a Subcontractor. The CONTRACTOR must obtain copies and maintain current versions of all Subcontractors' policies, Certificate of Liability and mandatory endorsements effecting coverage. Upon request, CONTRACTOR must furnish OCSD with the above referenced required documents. G. Required Forms and Endorsements 1. Required ACORD Form a. Certificate of Liability Form 25 2. Required Insurance Services Office, Inc. Endorsements (when alternative forms are shown, they are listed in order of preference) In the event any of the following forms are cancelled by Insurance Services Office, Inc. (ISO), or are updated, the ISO replacement form or equivalent must be supplied. a. Commercial General Liability Form CG-0001 10 01 b. Additional Insured Including Form CG-2010 10 01 and Products-Completed Operations Form CG-2037 10 01 C. Waiver of Transfer of Rights of Form CG-2404 11 85; or Recovery Against Others to Us/ Form CG-2404 10 93 Waiver of Subrogation C-CA-121914 xM 1 JOBCONTRACT NO. xM 5 JOBCONTRACT TITLE. CONFORMED Page 20 of 25 3. Required State Compensation Insurance Fund Endorsements a. Waiver of Subrogation Endorsement No. 2570 b. Cancellation Notice Endorsement No. 2065 4. Additional Required Endorsements a. Notice of Policy Termination Manuscript Endorsement SECTION- 17 RISK AND INDEMNIFICATION All Work covered by this Contract done at the site of construction or in preparing or delivering materials to the site shall be at the risk of CONTRACTOR alone. CONTRACTOR shall save, indemnify, defend, and keep OCSD and others harmless as more specifically set forth in General Conditions, "General Indemnification". SECTION — 18 TERMINATION This Contract may be terminated in whole or in part in writing by OCSD in the event of substantial failure by the CONTRACTOR to fulfill its obligations under this Contract, or it may be terminated by OCSD for its convenience provided that such termination is effectuated in a manner and upon such conditions set forth more particularly in General Conditions, "Termination for Default" and/or"Termination for Convenience", provided that no termination may be effected unless proper notice is provided to CONTRACTOR at the time and in the manner provided in said General Conditions. If termination for default or convenience is effected by OCSD, an equitable adjustment in the price provided for in this Contract shall be made at the time and in the manner provided in the General Conditions, "Termination for Default" and "Termination for Convenience". SECTION — 19 WARRANTY The CONTRACTOR agrees to perform all Work under this Contract in accordance with the Contract Documents, including OCSD's designs, Drawings and Specifications. C-CA-121914 W 1 JOBCONTRACT NOD aM 5 JOBCONTRACT TITLE. CONFORMED Page 21 of 25 The CONTRACTOR guarantees for a period of at least one (1)year from the date of Final Acceptance of the Work, pursuant to the General Conditions, "Final Acceptance and Final Completion' that the completed Work is free from all defects due to faulty materials, equipment or workmanship and that it shall promptly make whatever adjustments or corrections which may be necessary to cure any defects, including repairs of any damage to other parts of the system resulting from such defects. OCSD shall promptly give notice to the CONTRACTOR of observed defects. In the event that the CONTRACTOR fails to make adjustments, repairs, corrections or other work made necessary by such defects, OCSD may do so and charge the CONTRACTOR the cost incurred. The CONTRACTOR's warranty shall continue as to any corrected deficiency until the later of(1)the remainder of the original one-year warranty period; or (2)one year after acceptance by OCSD of the corrected Work. The Performance Bond and the Payment Bond shall remain in full force and effect through the guarantee period. The CONTRACTOR's obligations under this clause are in addition to the CONTRACTOR's other express or implied assurances under this Contract, including but not limited to specific manufacturer or other extended warranties specified in the Plans and Specifications, or state law and in no way diminish any other rights that OCSD may have against the CONTRACTOR for faulty materials, equipment or Work. SECTION -20 ASSIGNMENT No assignment by the CONTRACTOR of this Contract or any part hereof, or of funds to be received hereunder, will be recognized by OCSD unless such assignment has had prior written approval and consent of OCSD and the Surety. SECTION —21 RESOLUTION OF DISPUTES OCSD and the CONTRACTOR shall comply with the provisions of California Public Contract Code Section 20104 at. seq., regarding resolution of construction claims for any Claims which C-CA-121914 xM 1 JOBCONTRACT NO. xM 5 JOBCONTRACT TITLE. CONFORMED Page 22 of 25 arise between the CONTRACTOR and OCSD, as well as all applicable dispute and Claims provisions as set forth in the General Conditions and as otherwise required by law. SECTION —22 SAFETY & HEALTH CONTRACTOR shall comply with all applicable safety and health requirements mandated by federal, state, city and/or public agency codes, permits, ordinances, regulations, and laws, as well as these Contract Documents, including but not limited to the General Requirements, Section entitled 'Safety" and Exhibit B OCSD Safety Standards. SECTION—23 NOTICES Any notice required or permitted under this Contract may be given by ordinary mail at the address set forth below. Any party whose address changes shall notify the other party in writing. TO OCSD: Orange County Sanitation District 10844 Ellis Avenue Fountain Valley, California 92708-7018 Attn: Clerk of the Board Copy to: Orange County Sanitation District 10844 Ellis Avenue Fountain Valley, California 92708-7018 Attn: Construction Manager Bradley R. Hogin, Esquire Woodruff, Spradlin & Smart 555 Anton Boulevard Suite 1200 Costa Mesa, California 92626 C-CA-121914 W 1 JOBCONTRACT NOD aM 5 JOBCONTRACT TITLE. CONFORMED Page 23 of 25 TO CONTRACTOR: Kiewit Infrastructure West Company 10704 Shoemaker Avenue Santa Fe Springs, CA 90670 Copy to: Eric M. Scott, Senior Vice President Kiewit Infrastructure West Company 10704 Shoemaker Avenue Santa Fe Springs, CA 90670 C-CA-121914 xM 1 JOBCONTRACT NO. xM 5 JOBCONTRACT TITLE. CONFORMED Page 24 of 25 IN WITNESS WHEREOF, the parties hereto have executed this Contract Agreement as the date first hereinabove written. CONTRACTOR: Kiewit Infrastructure West Company 10704 Shoemaker Avenue Santa Fe Springs, CA 90670 By Printed Name Its CONTRACTOR's State License No. 433176 (Expiration Date: 01/31/2017) OCSD: Orange County Sanitation District By Chair, Board of Directors By Clerk of the Board By Contracts, Purchasing and Materials Management Division Manager C-CA-121914 W 1 JOBCONTRACT NOD aM 5 JOBCONTRACT TITLE. CONFORMED Page 25 of 25 STEERING COMMITTEE Meeting Date TOBd.of Dir. 11/18/15 11/18/15 AGENDA REPORT emNumber ItemNumbe 3 19 Orange County Sanitation District FROM: James D. Herberg, General Manager SUBJECT: EXTENSION OF AGREEMENT WITH EAST ORANGE COUNTY WATER DISTRICT GENERAL MANAGER'S RECOMMENDATION Authorize the General Manager to negotiate and execute an extension of the Local Sewer Facilities Transfer Agreement with East Orange County Water District regarding the transfer of local sewers in Service Area 7. SUMMARY Orange County Sanitation District (OCSD) entered into an agreement with East Orange County Water District (EOCWD) on February 27, 2014 to transfer ownership and the responsibility for the local sewers in Service Area 7 from OCSD to EOCWD. The Agreement was amended in April 2015, extending the agreement to December 31, 2015, and adding language to prohibit the diversion of wastewater from OCSD's service area. This provision is important to ensure that flows will continue to be routed to OCSD so we can continue to meet our contractual obligations to the Orange County Water District (OCWD). The proposed transfer of ownership of the local sewers requires an OC LAFCO approved reorganization. EOCWD initiated the OC LAFCO process in March 2014 by filing an application for reorganization. Irvine Ranch Water District (IRWD) has also submitted an application to assume the local sewer ownership in Service Area 7. At a community workshop on October 28, 2015, OC LAFCO staff presented a report with their preliminary recommendation that IRWD take on local sewer service rather than EOCWD. The transfer agreement with EOCWD, which expires on December 31, 2015 precludes OCSD from negotiating with any other entity regarding the transfer of Service Area 7 sewers. In accordance with the agreement, OCSD has not negotiated terms with IRWD. IRWD has submitted a letter to OC LAFCO (attached) indicating their commitment to language ensuring that sewer flows continue to be routed to OCSD for treatment, similar to provisions in the EOCWD transfer agreement. EOCWD has requested that OCSD amend the transfer agreement a second time to extend the timeline. Staff is seeking direction from the Board whether OCSD should proceed with extension of its agreement with EOCWD. Page 1 d 2 BUDGET/PURCHASING ORDINANCE COMPLIANCE N/A ATTACHMENT The following attachment(s) are attached in hard copy and may also be viewed online at the OCSD website(www.ocsd.coml with the complete agenda package: • Current Agreement and Amendment#1 with EOCWD • Letter from IRWDto OC LAFCO Page 2 d 2 ATTACHMENT LOCAL SEWER FACILITIES TRANSFER AGREEMENT THIS LOCAL SEWER FACILITIES TRANSFER AGREEMENT ("Agreement") is made this �'7 day of �f - , 2014 ("Effective Date") by and between the ORANGE COUNTY SANITATION DISTRICT ("OCSD"), a duly organized County Sanitation District existing pursuant to California Health and Safety Code section 47000 et seq., and the EAST ORANGE COUNTY WATER DISTRICT ("EOCWD"), a duly organized County Water District existing pursuant to California Water Code section 30000 et seq. OCSD and EOCWD are sometimes hereinafter individually referred to as "Party' and hereinafter collectively referred to as "Parties". RECITALS WHEREAS, OCSD owns and operates regional wastewater collection, conveyance, treatment, and disposal facilities within its 471 square mile service area; WHEREAS, OCSD owns and operates the local wastewater collection and conveyance system, encompassing approximately 174 linear miles of sewer lines and serving more than 18,000 connections, within the area known as Service Area 7, which area is more particularly identified in Exhibit "A" attached hereto and incorporated herein by reference; WHEREAS, OCSD desires to transfer to EOCWD: (a) its ownership of certain local sanitary sewer lines and appurtenant facilities located in Service Area 7 ("Local Sewer Facilities"), which are more particularly described and delineated in attachments 1 and 2 of Exhibit "B" attached hereto and incorporated herein by reference, and (b) the responsibility for providing local sewer service to Service Area 7; WHEREAS, EOCWD desires to acquire ownership and assume responsibility for the Local Sewer Facilities and to accept responsibility for providing local sewer service to Service Area 7; WHEREAS, the transfer of ownership in and the assumption of responsibility for the Local Sewer Facilities to EOCWD will require the approval of the Orange County Local Agency Formation Commission ("LAFCO"); and WHEREAS, following the transfer to EOCWD of the Local Sewer Facilities, OCSD shall retain its power to provide regional sewer service within the entirety of Service Area 7. Page 1 of 10 985662.1 AGREEMENT NOW, THEREFORE, in consideration of the mutual promises set forth herein, the Parties agree as follows: 1. Recitals. The recitals set forth above are true and correct and are incorporated into this Agreement. 2. Cooperation. a. OCSD and EOCWD shall work cooperatively to complete the successful transfer from OCSD to EOCWD of the Local Sewer Facilities and the assumption of responsibility for ongoing operation and maintenance of the Local Sewer Facilities by EOCWD by no later than December 1, 2014. Both Parties shall execute any further documents consistent with the terms of this Agreement, including documents in recordable form, necessary or appropriate to full the obligations imposed by this Agreement. 3. LAFCO Proposal. a. Initiation of Proceedings. EOCWD shall, within one month (30 days) from the Effective Date, initiate proceedings under the Cortese-Knox- Herzberg Local Government Reorganization Act of 2000, as amended, Government Code section 56000, at seq., requesting LAFCO approval of a reorganization proposal (the "Proposal"). The resolution of application enacted by EOCWD and submitted to LAFCO shall propose that LAFCO's approval of the Proposal shall be subject to the terms and conditions of this Agreement. EOCWD shall be solely responsible for the direct costs incurred in connection with the initiation and processing of the Proposal, and LAFCO approval thereof, including without limitation any LAFCO deposits, application or processing fees, and the cost of preparing any legal descriptions, boundary surveys or maps. The Proposal shall consist of the following: i. The annexation of certain territory within Service Area 7 that is not within the current boundaries of EOCWD; and ii. A proposal by EOCWD to provide a new or different service—"local" sewer service —within the entirety of Service Area 7. b. Public Outreach. EOCWD desires to proactively inform the ratepayers within Service Area 7, and the general public, of the Proposal and the process for implementing it, including opportunities for public involvement. In furtherance of that desire, OCSD agrees to provide EOCWD with a mailing list of the property owners in Service Area 7 (consistent with the format used for Proposition 218 notifications) in an Excel spreadsheet or an Access compatible (SQL) database format within 30 days of EOCWD's submittal of an application to LAFCO. In the written materials, EOCWD shall accurately and fairiy describe the Page 2 of 10 9856621 proposal and may indicate that the Proposal is jointly proposed and supported by EOCWD and OCSD. EOCWD shall provide OCSD an opportunity to review and approve the written material lt intends to mail to the property owners in Service Area 7 prior to such mailing. OCSD shall approve, or request changes to, the written materials within ten days of receipt. If OCSD fails to approve or request revisions within 10 days, it shall be deemed to have approved the materials. OCSD shall approve, or request changes to, revised written materials that incorporate or respond to OCSD's requests for changes within 5 days of receipt, or the materials shall be deemed approved. All costs of producing such material and mailing it will be paid by EOCWD. C. Letter of Support. OCSD shall cooperate with EOCWD and use its best efforts to support the Proposal in accordance with the terms of this Agreement. OCSD shall, within 45 days of EOCWD's filing of the Proposal with LAFCO, file with LAFCO a formal Letter of Support in favor of the Proposal executed by the General Manager ("Letter of Support'). The Letter of Support shall propose that LAFCO's approval of the Proposal shall be subject to the terms and conditions of this Agreement. OCSD shall execute such documents and take such other actions to support and facilitate the processing of the Proposal as may be reasonably requested by EOCWD, provided such actions shall not result in any cost or expense to OCSD (other than overhead and employee staff time). d. Continuing Support for Proposal. The Parties agree to support and not oppose the Proposal before and after it is initiated. Specifically, OCSD and EOCWD will cooperate and consult with one another in responding to questions and inquiries from LAFCO, the public and the press, appear in support of the Proposal at LAFCO hearings, and cooperate on a joint response in the event that LAFCO or LAFCO staff propose to alter the Proposal. Furthermore, OCSD agrees that, prior to December 1, 2014, or such earlier time as the LAFCO proceedings have been completed or disapproved, it will not engage in negotiations with other entities regarding the transfer of the Local Sewer Facilities. Both Parties shall support the conditioning of LAFCO's approval of the Proposal on the performance of the terms and conditions of this Agreement. If LAFCO or LAFCO staff propose an alteration to the Proposal that materially diverges from the terms and conditions of this Agreement, either Party may, after consultation with the other Party, oppose the alteration, and if necessary, withdraw its support, and actively oppose LAFCO's approval of the Proposal. e. Tax Exchange Negotiations and Consultations. The Parties shall cooperate in seeking to have the Board of Supervisors adopt a property tax exchange resolution pursuant to Revenue and Taxation Code section 99 exchanging property tax from OCSD to EOCWD. The Parties agree that in the tax exchange negotiation and consultation process they will jointly support and advocate for having all of the property tax associated with the Local Sewer Facilities be exchanged from OCSD to EOCWD. In Fiscal Year 2012-2013, the Page 3 of 10 99562.1 estimated property tax collected for the local sewers was $287,000.00 (two hundred eighty seven thousand dollars). f. Local Sewer Service User Fee. i. OCSD's Annual Local Sewer Service User Fee ('the Fee") shall be continued and following the effective date, to the extent feasible, shall be collected by EOCWD rather than by OCSD. OCSD collects the Fee by reporting it to the County of Orange, which collects it on the property tax roll, and EOCWD intends to do the same. Should it not be feasible, due to statutory or County requirements, for responsibility for collection of the Fee for the 2014-2015 Fiscal Year to be transferred to EOCWD, OCSD shall account for and transmit, within 5 business days of receipt, any such revenues it receives from the County that are attributable to the Fee imposed in Service Area 7. OCSD shall rescind the Fee, as it pertains to the Local Sewer Facilities, by no later than July 1, 2015, or at such earlier time as EOCWD may enact its own local sewer service user fees. ii. EOCWD shall indemnify, defend and hold harmless, OCSD, its officers, directors, employees and agents from and against any and all claims, actions, damages, liabilities, and expenses (including attorney's fees and reasonable expenses for litigation or settlement) in connection with or arising out of OCSD's assessment, distribution, and collection of the Fee, including without limitation any such claims asserting that the collection by OCSD and transfer of the Fee to EOCWD violates Proposition 218. 4. Transfer of Local Sewer Facilities. a. Upon the effective date of LAFCO's approval of the Proposal and the requested reorganization ("Date of Reorganization"), EOCWD shall accept ownership of the Local Sewer Facilities and all maintenance responsibilities, as well as the responsibility for all sewer spill notification, reporting, and related regulatory activities. Furthermore, EOCWD shall negotiate, execute and maintain its own contracts with third-party contractors for line- cleaning, CCTV, rehabilitation, repairs and replacement, engineering consultants, and similar services, and directly pay all costs for such contracts. b. Prior to the Date of Reorganization, EOCWD shall fully execute and deliver to OCSD the Quitclaim Deed, attached hereto as Exhibit"B", transferring ownership of the Local Sewer Facilities from OCSD to EOCWD. C. Within five (5) business days following the Date of Reorganization, OCSD shall submit the Quitclaim Deed for recordation in the Official Records, Orange County California. Upon recordation, OCSD shall transmit a conformed copy of the Quitclaim Deed to EOCWD. d. Within five (5) business days following the Date of Reorganization, OCSD shall transfer to EOCWD $15,000,000.00 (fifteen million Page 4 of 10 985662.1 dollars) via wire transfer of the Annual Sewer Service User Fee reserves attributable to the Local Sewer Facilities ("First Disbursement'). e. On July 1, 2018, OCSD shall transfer to EOCWD $10,000,000.00 (ten million dollars) via wire transfer of the Annual Sewer Service User Fee reserves attributable to the Local Sewer Facilities ("Second Disbursement'). f. If, after the Date of Reorganization and prior to July 1, 2018, EOCWD identifies the need for a major repair or replacement of the Local Sewer Facilities, OCSD shall release to EOCWD a mutually agreed upon portion of the Second Disbursement, as necessary to complete the required work in a timely manner. Any such release will result in a proportionate reduction of reserves transferred with the Second Disbursement g. If, prior to the Date of Reorganization, OCSD identifies the need for a major repair or replacement of the Local Sewer Facilities, and after notifying EOCWD of the identified need, OCSD conducts such major repair or replacement, the amount of reserves transferred with the First Disbursement, and if necessary, the Second Disbursement shall be reduced by the amount of costs incurred by OCSD in connection with the required work. h. After closing its books for the 2017-2018 Fiscal Year, and by no later than November 1, 2018, OCSD shall transfer to EOCWD the remainder of the Annual Sewer Service User Fee reserves, if any, attributable to the Local Sewer Facilities. 1. OCSD shall pay to EOCWD annual interest at the OCSD average rate of return on the amount of Annual Sewer Service User Fee reserves attributable to the Local Sewer Facilities retained by OCSD between the date of the First Disbursement and the Second Disbursement. OCSD shall make the annual interest payments after it has closed its books for each respective fiscal year, but by no later than November 1. j. Upon the Date of Reorganization, OCSD shall transfer ownership of the following vehicles to EOCWD: (a) a 2000 Sterling Vactor (OCSD vehicle 470, California license number 1067492, vehicle identification number (VIN) 2FZ6BJBB81AH61833), and (b) a 1995 FE42 Volvo Hydroflusher truck (OCSD vehicle 396, Califomia license number 356619, vehicle identification number (VIN) 4V52AFHDOSR474402). These vehicles shall be provided to EOCWD "as is" and with no warranties or representations whatsoever as to the condition of the vehicle, or the suitability of the vehicle for any purpose. EOCWD hereby acknowledges that it has/will be granted the opportunity to inspect the vehicles and their maintenance records and has/will do so prior to the Date of Reorganization. Page 5 of 10 985662.1 k. On or prior to the Date of Reorganization, OCSD shall allow EOCWD to review, reference and utilize OCSD established specifications for line-cleaning, CCTV, rehabilitation, repairs and replacement, and similar services, as mutually agreed by the Parties. 5. Environmental Review. EOCWD shall act as lead agency for purposes of the Proposal, and shall be solely responsible for the preparation of all environmental documentation required pursuant to the California Environmental Quality Act ("CEQA"). 6. Tenn. This Agreement shall commence on the Effective Date and continue in full force and effect through December 1, 2014. The Parties may mutually agree in writing to extend the tens of this Agreement. The Agreement shall automatically terminate if LAFCO disapproves the Proposal. 7. Notices. All notices or other communications required or permitted hereunder shall be in writing and shall be personally delivered, sent by registered or certified mail, postage prepaid, return receipt requested, or delivered or sent by electronic transmission, and shall be deemed received upon the earlier of: (i) the date of delivery to the address of the person to receive such notice if delivered personally or by messenger or overnight courier; (ii) three (3) business days after the date of posting by the United States Post Office if by mail; or (iii) when sent if given by electronic transmission. Any notice, request, demand, direction, or other communication sent by electronic transmission must be confirmed within forty-eight (48) hours by letter mailed or delivered. Notices or other communications shall be addressed as follows: To OCSD: Orange County Sanitation District 10844 Ellis Avenue Post Office Box 8127 Fountain Valley, CA 92708-7018 Attn: General Manager To EOCWD: East Orange County Water District 185 North McPherson Road Orange, CA 92869-3720 Attn: General Manager Either Party may from time to time, by written notice to the other, designate a different address and/or person which shall be substituted for the one above specified, and/or specify additional parties to be notified. 8. Jurisdiction. In the event of a dispute regarding performance or interpretation of this Agreement, the venue for any action to enforce or interpret this Agreement shall lie in the Superior Court of California for Orange County. Page 6 of 10 995662.1 9. Governing Law. This Agreement shall be governed by the laws of the State of California. 10. Entire Agreement. This Agreement constitutes the entire understanding and agreement between the Parties and supersedes all previous negotiations between the Parties pertaining to the subject matter thereof. 11. Waiver. A waiver of a breach of the covenants, conditions or obligations under this Agreement by either Party shall not be construed as a waiver of any succeeding breach of the same or other covenants, conditions or obligations of this Agreement. 12. Modification. Alteration, change or modification of this Agreement shall be in the form of a written amendment, which shall be signed by each Party. 13. Severability. Whenever possible, each provision of this Agreement shall be interpreted in such a manner as to be effective and valid under applicable law, but if any provision of this Agreement shall be invalid under the applicable law, such provision shall be ineffective only to the extent of such prohibition or invalidity, without invalidating the remainder of that provision, or the remaining provisions of this Agreement. 14. No Obligation to Third Parties. Execution and delivery of this Agreement shall not be deemed to confer any rights upon others, directly, indirectly or by way of subrogation, and shall not obligate either of the Parties hereto to any person or entity other than each other and their respective affiliates. 15. Successors. This Agreement and the provisions contained herein shall be binding upon and inure to the benefit of OCSD, EOCWD, and their respective heirs, executors, administrators, personal representatives, successors and assigns. 16. Indemnification. a. EOCWD shall indemnify, defend and hold harmless OCSD, its officers, directors, employees and agents from and against any and all claims, actions, damages, liabilities and expenses (including attorney's fees and reasonable expenses for litigation or settlement) for any loss or damage, including death, bodily injury or damage to or loss of use of property, caused by negligent acts or omissions or willful misconduct by the EOCWD, its officers, directors, employees and agents in connection with or arising out of the performance of this Agreement. b. OCSD shall indemnify, defend and hold harmless EOCWD, its officers, directors, employees and agents from and against any and all claims, actions, damages, liabilities and expenses (including attorney's fees and Page 7 of 10 995662A reasonable expenses for litigation or settlement) for any loss or damage, including death, bodily injury or damage to or loss of use of property, caused by negligent acts or omissions or willful misconduct by OCSD, its officers, directors, employees and agents in connection with or arising out of the performance of this Agreement. C. The Parties acknowledge that LAFCO policy requires applicants to defend, indemnify, hold harmless, and release LAFCO, its agents, officers, attorneys, and employees from any claim, action, or proceeding brought against any of them, the purpose of which is to attack, set aside, void, or annul the approval of the application or the environmental document that accompanies it. The parties further acknowledge that this indemnification obligation will include, but not be limited to, damages, costs, expenses, attorney fees, or expert witness fees that may be asserted by any person or entity, including the applicant, arising out of or in connection with the approval of the application. As the applicant, EOCWD will be required to execute such an indemnification agreement with LAFCO, and, as a result, EOCWD may incur substantial costs paying for LAFCO's defense and indemnifying any liability. Notwithstanding anything to the contrary in the foregoing, If LAFCO does not approve the EOCWD Proposal, OCSD agrees to pay one-half of EOCWD's actual costs, associated with indemnifying LAFCO pursuant to the indemnification agreement it will be obligated to sign, as those costs are incurred; however, OCSD's payment hereunder shall not exceed $100,000.00 (one hundred thousand dollars) in total. Furthermore, if LAFCO approves the EOCWD Proposal, OCSD shall have no obligation to pay any of EOCWD's actual costs associated with indemnifying LAFCO. EOCWD shall promptly advise OCSD if the indemnification agreement it is obligated to sign as the applicant is materially different than described in this paragraph, and it shall notify OCSD if LAFCO notes EOCWD of a legal challenge covered by the indemnification agreement. 17. OCSD Board of Directors. The Parties acknowledge that nothing contained herein shall entitle EOCWD to a seat on the OCSD Board of Directors, and that any such change would require an amendment to Health and Safety Code section 4730.65, which governs the composition of the OCSD Board of Directors. 18, No Warranty of Title or Condition. OCSD makes not warranty or representation of any kind regarding its title to the Local Sewer Facilities, the condition of the Local Sewer Facilities, or the suitability of the Local Sewer Facilities for any purpose. EOCWD has been granted an opportunity to fully inspect the Loral Sewer Facilities and has done so as of the Effective Date. EOCWD accepts the Local Sewer Facilities "as is". 19. Authorization. Each of the undersigned represents and warrants that he or she is duly authorized to execute and deliver this Agreement and that such execution is binding upon the entity for which he or she is executing this document. Page 8 of 10 985662.1 (SIGNATURES ON FOLLOWING PAGE( Page 9 of 10 985662.1 IN WITNESS WHEREOF, the Parties hereto have executed this Agreement on the dates set forth below. ORANGE COUNTY SANITATION DISTRICT i By Date 2 Troy Edgar, Chairman of the oard ATTEST: �p M ria Ayala C rk of the Board APPROVgp AS TO FORM: Brad ogin General Counsel EAST ORANGE COUNTY WATER DISTRICT By\_ C v �� Date William VanderWerff \ President of the Board of rectors ATTEST: APPROVED AS TO FORM: .JsarrAfnesafr—, C6_'_-�. Spece�..� �o�ths� Page 10 of 10 9856621 EXHIBIT "A" SERVICE AREA 7 985662.1 a 3556 31'A L3 3148 3149 31 0 M51 k5�2 I� e.3 32-. x -^.45 32aG 3249 3250 3 3252 x I0 p.H 3,343 33. 4� 3347 �_ 3349 3359 �'3 3352 I Pd s 53 34ZI 4 � I F ILI sJ4s" 8 � tY z35 - 30>5 52`i � 3 s S -✓� ) 3545 354E � 3�4T �� � ��SS .s„3o � 3652 I 3745 311461-� 'fZ � _ 3751 3 E 3851 38 cq� i 9 a_ s o y 7 3949 3950 S1 - 52 -4.�,'i 4048 ,405D 4 P 1 406 tea¢ 45• r a 4 4148 Local Service Area 7 #' Sewer Transfers Cffy 41N Key Map 4343 � 43 s FIRST MENT TO LOCAL SEWER FACILITIES ACILITIES V ORIGIN//'�� TRANSFER AGREEMENT "� THIS FIRST AMENDMENT TO LOCAL SEWER FACILITIES TRANSFER AGREEMENT ("Agreement") is made this°- day of 2015 ("Effective Date") by and between the ORANGE COUNTY SANITATION DISTRICT ("OCSD"), a duly organized County Sanitation District existing pursuant to California Health and Safety Code section 47000 et seq., and the EAST ORANGE COUNTY WATER DISTRICT ("EOCWD"), a duly organized County Water District existing pursuant to California Water Code section 30000 at seq. OCSD and EOCWD are sometimes hereinafter individually referred to as "Party" and hereinafter collectively referred to as "Parties". RECITALS WHEREAS, OCSD and EOCWD are Parties to that certain "Local Sewer Facilities Transfer Agreement," dated February 27, 2014 ("the Agreement"), in which the Parties set forth their intent to cooperate in the transfer of ownership in and the assumption of responsibility for certain local sewer facilities from OCSD to EOCWD; and WHEREAS, the transfer process requires the approval of the Orange County Local Agency Formation Commission ("LAFCO"), and, although that process commenced in a timely manner, the LAFCO process has taken longer than the Parties anticipated; and WHEREAS, the Parties therefore desire to amend the Agreement to extend the timelines and termination date to reflect the current status of the LAFCO process; and WHEREAS, the Agreement provides for two disbursements of Annual Sewer Service User Fee reserves from OCSD to EOCWD, totaling $25 million; and WHEREAS, the Parties desire to amend the Agreement to provide for a single disbursement of the $25 million Annual Service User Fee reserves from OCSD to EOCWD; and WHEREAS, the Agreement does not address the diversion of wastewater from Service Area 7; and WHEREAS, the Parties desire to amend the Agreement to prohibit the diversion of wastewater by EOCWD from Service Area 7. Page 1 of 4 AGREEMENT NOW, THEREFORE, in consideration of the mutual promises set forth herein, the Parties agree as follows: 1. Extension of Timelines. In order to reflect the changed circumstances with regard to the timeline for completion of the transfer, "December 1, 2014" in subsections 2.a. and 3.d. shall be amended to read "December 31, 2015"; and "July 1, 2015" and "2014-2015 Fiscal Year" in subsection 31i. shall be amended to read, respectively, "July 1, 2016" and "2015-2016 Fiscal Year." 2. Amendment to Section 4. i. Subsection 4.d. shall be amended to read as follows: d. Within five (5) business days following the Date of Reorganization, OCSD shall transfer to EOCWD $25,000,000.00 (twenty-five million dollars) via wire transfer of the Annual Sewer Service User Fee reserves attributable to the Local Sewer Facilities ("Disbursement"). ii. Subsections 4.e., 41, 4.g., 4.h. and 4.i. shall be deleted in entirety. III. New subsection 4.e. shall be added to read as follows: e. If, prior to the Date of Reorganization, OCSD identifies the need for a major repair or replacement of the Local Sewer Facilities, and after notifying EOCWD of the identified need, OCSD conducts such major repair or replacement, the amount of reserves transferred with the Disbursement shall be reduced by the amount of costs incurred by OCSD in connection with the required work. iv. New subsection 4.f. shall be added to read as follows: f. Within six (6) months following the date of Disbursement, OCSD shall reconcile its records and transfer to EOCWD the remainder of the Annual Sewer Service User Fee reserves in its possession, If any, attributable to the Loral Sewer Facilities. V. Subsections 4.j. and 4.k. shall be renumbered as 4.g. and 4.h. respectively. Page 2 of 4 3. Amendment to Section 6. Section 6 shall be amended to read as follows: 6. Term. This Agreement shall commence on the Effective Date and continue in full force and effect through December 31, 2015. The Parties may mutually agree in writing to extend the term of this Agreement. The Agreement shall automatically terminate if LAFCO disapproves the Proposal. 4. New Section 20. New Section 20 shall be added to read as follows: 20. Prohibition on Diversion of Wastewater. OCSD has planned and constructed regional conveyance and treatment facilities to serve Service Area 7. OCSD is contractually obligated to provide treated wastewater effluent from its entire service area, inclusive of Service Area 7, to Orange County Water District. EOCWD agrees that all parcels in Service Area 7 shall continue to be customers of OCSD, and that all wastewater flows from these parcels will continue to flow to OCSD for treatment. EOCWD shall not divert wastewater away from OCSD for any purpose, including but not limited to scalping wastewater for reuse. IN WITNESS WHEREOF, the Parties hereto have executed this Agreement on the dates set forth below. ORANGE COUNTY SANITATION DISTRICT By V Date James D. Herberg General Manager ATT ST: Kel A. Lore Cle of the Board APPROVED AS TO FORM: Brad Hogin General Counsel Page 3 of 4 EAST ORANGE CO N TY WATER DISTRICT d By. Date Li Ohlund eneral Manager ATTEST: APPROVED AS TO FORM: ohn Bakker Special Counsel Page 4 of 4 I ATTACHMENT IRVINERPCD WATER DISTRICT 1560SWdCm�A.w-PnaWSM-Wm,.r� November 10,2015 The Honorable Todd Spitzer Mr. Derek McGregor Chairman,Orange County Board of Supervisors Chairman,OC LAFCO 333 W. Santa Ana Blvd, 2677 North Main Street, Suite 1050 Santa Ana,California 92701 Orange,California 92705 Subject: Irvine Ranch Water District's Application for Annexation of Sewer Service Area 7 Dear Chairman Spitzer and Chairman McGregor: Irvine Ranch Water District(IRWD),throughout the process conducted by the Orange County Local Agency Formation Commission(OC LAFCO) in developing and finalizing the Focused Municipal Services Review for Service Area 7, has repeatedly articulated, verbally and in writing, its commitment to ensuring that the sewage from Service Area 7 will continue to flow m it currently does. The IRWD Board has taken an additional step to allay any lingering concerns regarding the flow of sewage from Service Area 7,and we hope that this additional step will close this matter satisfactorily. In its October 28,2015 report OC LAFCO staff provided its proposed recommendations regarding Orange County Sanitation District's(OCSD)Sewer Service Area 7. Language on page 16 of the staff report specifically addressed the firture treatment of the sewage from Service Area 7, including the sewage that currently flows to OCSD for treatment and subsequent use for groundwater replenishment. The staff report noted that the Fast Orange County Water District (EOC W D)and OCSD added a condition in their sewer transfer agreement(Amendment No 1)to continue the existing arrangement for treated sewage to be used for groundwater replenishment. To ensure no impact to that groundwater replenishment program administered by the Orange County Water District(OC W D), the staff report recommended that the terms and conditions of approval by OC LAFCO would include a requirement for the continuation of the existing sewage treatment arrangement for groundwater replenishment. The IRWD Board of Directors considered this issue at its November 9,2015 meeting and authorized me to inform OC LAFCO and the Orange County Board of Supervisors that IRWD is committed to including a condition in any necessary agreements between IRWD, OCSD and the OC W D that would ensure the continuation of that existing sewage treatment arrangement. This offer is made in addition to the condition expressly made by the IRWD Board when it directed IRWD staff to submit the District's annexation application for entering into a transfer agreement between IRWD and OCSD and a regional sewage treatment agreement between IRWD,OCSD and OC W D. By unanimous agreement of the IRWD Board, the District agrees to include the following language including in its agreements with OC LAFCO, OCSD,and any other required agencies: The Honorable Todd Spitzer, Chairman, Orange County Board of Supervisors Mr. Derek McGregor, Chairman, OC LAFCO November 10,2015 Page 2 OCSD has planned and constructed regional conveyance and treatment facilities to serve Service Area 7. OCSD is contractually obligated to provide pealed wastewater effluent from its entire service area,inclusive of Service Area 7,to Orange County Water District. IR WD and OCSD agree that all parcels in Service Area 7 shall continue to be customers of OCSD,and that the wastewater flows from these parcels will continue to flow for treatment as they currently flow. IRWD shall not divert the wastewater currently flowing to OCSD from Service Area 7 away from OCSD for any purpose, including but not limited to scalping wastewater for reuse. Please note that this language was purposely constructed based on the language in the agreement between EOCWD and OCSD. This was done to facilitate the future potential approval of this term by the OCSD Board, who has already approved similar language in its agreement with EOCWD. IR WD truly hopes that this additional action will help clarify,once and for all,a matter that appears to have remained open to question for too long. Please feel free to call me if you or your respective staff members have any questions concerning this proposed condition or the issue of continuing the existing sewage treatment arrangement. Sincerely, Steven LaMar President Irvine Ranch Water District cc: LAPCO Commission ORANGE COUNTY SANITATION DISTRICT Agenda Terminology Glossary Glossary of Terms and Abbreviations AQMD Air Quality Management District ASCE American Society of Civil Engineers BOD Biochemical Oxygen Demand CARB California Air Resources Board CASA California Association of Sanitation Agencies CCTV Closed Circuit Television CEQA California Environmental Quality Act CRWQCB California Regional Water Quality Control Board CWA Clean Water Act CWEA California Water Environment Association EIR Environmental Impact Report EMT Executive Management Team EPA U.S. Environmental Protection Agency FOG Fats, Oils, and Grease FSSD Facilities Support Services Department gpd Gallons per day GWR System Groundwater Replenishment System (also called GWRS) ICS Incident Command System IERP Integrated Emergency Control Plan LOS Level of Service MGD Million gallons per day NACWA National Association of Clean Water Agencies NPDES National Pollutant Discharge Elimination System NWRI National Water Research Institute O&M Operations and Maintenance OCCOG Orange County Council of Governments OCHCA Orange County Health Care Agency OCSD Orange County Sanitation District OCWD Orange County Water District GOBS Ocean Outfall Booster Station OSHA Occupational Safety and Health Administration POTW Publicly Owned Treatment Works ppm Parts per million RFP Request For Proposal RWQCB Regional Water Quality Control Board SARFPA Santa Ana River Flood Protection Agency Glossary of Terms and Abbreviations SARI Santa Ana River Inceptor SARWQCB Santa Ana Regional Water Quality Control Board SAWPA Santa Ana Watershed Project Authority SCADA Supervisory Control and Data Acquisition system SCAP Southern California Alliance of Publicly Owned Treatment Works SCAQMD South Coast Air Quality Management District SOCWA South Orange County Wastewater Authority SSMP Sanitary Sewer Management Plan SSO Sanitary Sewer Overflow SWRCB State Water Resources Control Board TDS Total Dissolved Solids TMDL Total Maximum Daily Load TSS Total Suspended Solids WDR Waste Discharge Requirements WEF Water Environment Federation WERF Water Environment Research Foundation Activated-sludge process — A secondary biological wastewater treatment process where bacteria reproduce at a high rate with the introduction of excess air or oxygen, and consume dissolved nutrients in the wastewater. Benthos— The community of organisms, such as sea stars, worms and shrimp, which live on, in, or near the seabed, also know as the benthic zone. Biochemical Oxygen Demand (BOD)—The amount of oxygen used when organic matter undergoes decomposition by microorganisms. Testing for BOD is done to assess the amount of organic matter in water. Biosolids — Biosolids are nutrient rich organic and highly treated solid materials produced by the wastewater treatment process. This high-quality product can be recycled as a soil amendment on farm land or further processed as an earth-like product for commercial and home gardens to improve and maintain fertile soil and stimulate plant growth. Capital Improvement Program (CIP) — Projects for repair, rehabilitation, and replacement of assets. Also includes treatment improvements, additional capacity, and projects for the support facilities. Coliform bacteria—A group of bacteria found in the intestines of humans and other animals, but also occasionally found elsewhere used as indicators of sewage pollution. E. coli are the most common bacteria in wastewater. Collections system — In wastewater, it is the system of typically underground pipes that receive and convey sanitary wastewater or storm water. 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. Glossary of Terms and Abbreviations Contaminants of Potential Concern (CPC) — Pharmaceuticals, hormones, and other organic wastewater contaminants. Dilution to Threshold (D!f) — the dilution at which the majority of the people detect the odor becomes the DrT for that air sample. Greenhouse gases — In the order of relative abundance water vapor, carbon dioxide, methane, nitrous oxide, and ozone gases that are considered the cause of global warming ("greenhouse effect"). Groundwater Replenishment (GWR) System — A joint water reclamation project that proactively responds to Southern California's current and future water needs. This joint project between the Orange County Water District and the Orange County Sanitation District provides 70 million gallons a day of drinking quality water to replenish the local groundwater supply. Levels of Service (LOS)—Goals to support environmental and public expectations for performance. NDMA— N-Nitrosodimethylamine is an N-nitrosoamine suspected cancer-causing agent. It has been found in the Groundwater Replenishment System process and is eliminated using hydrogen peroxide with extra ultra-violet treatment. National Biosolids Partnership (NBP) — An alliance of the National Association of Clean Water Agencies (NACWA) and Water Environment Federation (WEF), with advisory support from the U.S. Environmental Protection Agency (EPA). NBP is committed to developing and advancing environmentally sound and sustainable biosolids management practices that go beyond regulatory compliance and promote public participation in order to enhance the credibility of local agency biosolids programs and improved communications that lead to public acceptance. Plume—A visible or measurable concentration of discharge from a stationary source or fixed facility. Publicly-owned Treatment Works (POTW)— Municipal wastewater treatment plant. Santa Ana River Interceptor (SARI) Line — A regional brine line designed to convey 30 million gallons per day (MGD) of non-reclaimable wastewater from the upper Santa Ana River basin to the ocean for disposal, after treatment. Sanitary sewer — Separate sewer systems specifically for the carrying of domestic and industrial wastewater. Combined sewers carry both wastewater and urban run-off. South Coast Air Quality Management District (SCAQMD) — Regional regulatory agency that develops plans and regulations designed to achieve public health standards by reducing emissions from business and industry. Secondary treatment — Biological wastewater treatment, particularly the activated-sludge process, where bacteria and other microorganisms consume dissolved nutrients in wastewater. Sludge—Untreated solid material created by the treatment of wastewater. Total suspended solids (TSS)—The amount of solids floating and in suspension in wastewater. Trickling filter — A biological secondary treatment process in which bacteria and other microorganisms, growing as slime on the surface of rocks or plastic media, consume nutrients in wastewater as it trickles over them. Glossary of Terms and Abbreviations Urban runoff — Water from city streets and domestic properties that carry pollutants into the storm drains, rivers, lakes, and oceans. Wastewater—Any water that enters the sanitary sewer. Watershed —A land area from which water drains to a particular water body. OCSD's service area is in the Santa Ana River Watershed.