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HomeMy WebLinkAbout08-22-2012 Board Meeting Agenda _ Wednesday, August 22, 2012 Orange County Sanitation District 6:30 P.M. Regular Meeting of the Board Room Board of Directors 10844 Ellis Avenue +' Fountain Valley, CA 92708 N •' (714) 593-7130 AGENDA INVOCATION AND PLEDGE OF ALLEGIANCE: (Janet Nguyen, Orange County Board of Supervisors) DECLARATION OF QUORUM: ROLL CALL: PUBLIC COMMENTS: If you wish to speak, please complete a Speaker's Form (located at the table outside of the Board Room) and give it to the Clerk of the Board. Speakers are requested to limit comments to three minutes. 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. ( Ground Water Replenishment System CLAIMS: 1. Ratify payment of claims of the District, by roll call vote, as follows: Claims Paid for the Period Ending: 07/15/12 07/31/12 Totals $6,728,548.85 $53,062,575.29 DIRECTORS: Pursuant to Government Code Section 84308, you are required to disclose any campaign contribution greater than $250 received in the past twelve months from any party to a contract involving OCSD. This requires that you identify the contributor by name. Further, you may not participate in the decision making process to award a contract to such party. For reference, you are directed to the Register of Warrants as to all current contractors/vendors with OCSD. For the specifics of Government Code Section 84308, please see your Director's Handbook or call the office of General Counsel. 08/22/12 OCSD Board of Directors'Agenda Page 1 of 4 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 Any items withdrawn from the Consent Calendar for separate discussion will be considered in the regular order of business. 2. Approve minutes for the Regular Board Meeting held on July 25, 2012. 3. Authorize the General Manager to approve Amendment No. 7 to extend the agreement with Air Products and Chemicals, Inc., for Private Operation and Maintenance of Oxygen Generation System at Plant No. 2, Purchase Order 43063-OB for an additional five (5) month period beginning retroactively August 1, 2012, through December 31, 2012, at no additional cost to the District. 4. Authorize the General Counsel to appear and represent the interest of the Orange County Sanitation District in the matter of City of Brea v. State of California, Sacramento County Superior Court Case No. 34-2012-8000-1204. STEERING COMMITTEE: 5. Approve minutes of the July 25, 2012, Steering Committee Meeting. 6. Decline Proposal from EnerTech to Enter into a New Agreement for Management of Biosolids. OPERATIONS COMMITTEE: 7. Approve minutes of the August 1, 2012, Steering Committee Meeting. 8. Approve a contingency increase of $79,540 (10%) to the Professional Design Services Agreement with AECOM Technical Services for the Balboa Trunk Sewer Rehabilitation, Project No. 5-47, for a total contingency of $159,280 (20%). 9. Approve a contingency increase of $266,248 (13%) to the construction contract with J. Fletcher Creamer & Son, Inc., for Interplant Gas Line Rehabilitation, Project No. J-106, for a total contingency of $409,612 (20%) 10. Approve a budget increase of $97,000 for Central Generation Automation, Project J-79-1, for a total budget amount of$23,443,000. 08/22/12 OCSD Board of Directors'Agenda Page 2 of 4 NON-CONSENT: 11. A. Receive and file Statement of Complaint for the Recommendation of Biosolids Management Contract Award letter dated July 12, 2012 from Terra Renewal West LLC protesting award to Tule Ranch; B. Receive and file letter dated July 23, 2012 to Terra Renewal West LLC responding to the Statement of Complaint; and, C. Approve a contract with Tule Ranch to manage the Orange County Sanitation District's biosolids from Reclamation Plant No. 1 and Treatment Plant No. 2 for land application and/or landfill disposal (Specification No. S-2011-51313D), for the period commencing on January 1, 2013 through December 31, 2017, with one five-year renewal option, for the unit price of $54.50 per ton for land application, for a total annual amount not to exceed $19,000,000. CLOSED SESSION: During the course of conducting the business set forth on this agenda as a regular meeting of the Board, the Chair may convene the Board in closed session to consider matters of pending real estate negotiations, pending or potential litigation, or personnel matters, pursuant to Government Code Sections 54956.8, 54956.9, 54957 or 54957.6, as noted. Reports relating to (a) purchase and sale of real property; (b) matters of pending or potential litigation; (c) employment actions or negotiations with employee representatives; or which are exempt from public disclosure under the California Public Records Act, may be reviewed by the Board during a permitted closed session and are not available for public inspection. At such time as the Board takes final action on any of these subjects, the minutes will reflect all required disclosures of information. Convene in closed session. (1) CONFERENCE WITH LEGAL COUNSEL RE. EXISTING LITIGATION (Subdivision (a) of Section 54956.9) Case: Orange County Sanitation District v. Liberty Mutual, et al., U.S. District Court, Central District of California, Case No. SACV 12-854-JVS (AJWx) Reconvene in regular session. Consideration of action, if any, on matters considered in closed session. OTHER BUSINESS AND COMMUNICATIONS OR SUPPLEMENTAL AGENDA ITEMS, IF ANY: 08/22/12 OCSD Board of Directors'Agenda Page 3 of 4 ADJOURNMENT: Adjourn the Board meeting until the next regular Meeting on September 26, 2012, at 6:30 p.m. 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) 593-7130 at least 72 hours prior to the scheduled meeting. Requests must specify the nature of the disability and the type of accommodation requested. Agenda Posting: In accordance with the requirements of California Government Code Section 54954.2, this agenda has been posted outside the main gate of the Sanitation District's Administration Building located at 10844 Ellis Avenue, Fountain Valley, California, not less than 72 hours prior to the meeting date and time above. All public records relating to each agenda item, including any public records distributed less than 72 hours prior to the meeting to all, or a majority of the Board of Directors, are available for public inspection in the office of the Clerk of the Board. NOTICE TO DIRECTORS: To place items on the agenda for the Committee Meeting, items must be submitted to the Clerk of the Board 14 days before the meeting. Maria E.Ayala Clerk of the Board (714)593-7130 mayala@ocsd.com For any questions on the agenda, Committee members may contact staff at: General Manager Jim Ruth (714)593-7110 ]ruthC@ocsd.com Assistant General Manager Bob Ghirelli (714)593-7400 rghirelliC@ocsd.com Assistant General Manager Jim Herberg (714)593-7300 Iherberg(a)ocsd.com Director of Facility Support Services Nick Arhontes (714)593-7210 narhontesC@ocsd.com Director of Finance and Lorenzo Tyner (714)593-7550 ItynerCo)ocsd.com Administrative Services Director of Human Resources Jeff Reed (714)593-7144 jreedCcDocsd.com Director of Operations&Maintenance Ed Torres 714 593-7080 etorres ocsd.com 08/22/12 OCSD Board of Directors'Agenda Page 4 of 4 BOARD OF DIRECTORS Meeting Date To Bd. of Dir. 08/22/12 AGENDA REPORT Item Number Item Number I Orange County Sanitation District FROM: James D. Ruth, General Manager Originator: Lorenzo Tyner, Director of Finance and Administrative Services SUBJECT: PAYMENT OF CLAIMS OF THE ORANGE COUNTY SANITATION DISTRICT GENERAL MANAGER'S RECOMMENDATION Ratify Payment of Claims of the District by Roll Call Vote. CONFLICT OF INTEREST NOTIFICATION Pursuant to Government Code Section 84308, you are required to disclose any campaign contribution greater than $250 received in the past twelve months from any party to a contract involving the Orange County Sanitation District. Further, you may not participate in the decision making process to award a contract to such party. For reference, you are directed to the Register of Warrants as to all current contractors/vendors with the District. In general, you must disclose the basis of the conflict by identifying the name of the firm or individual who was the contributor. For the specifics of Government Code Section 84308, please see your Director's Handbook or call the office of General Counsel. PRIOR COMMITTEE/BOARD ACTIONS N/A ADDITIONAL INFORMATION See attached listing. ATTACHMENTS 1. Copies of Claims Paid reports from 7/01/12 — 7/15/12 and 7/16/12 — 7/31/12 Page 1 of 1 Claims Paid From 7/1/12 to 7/15/12 Vendor Warrant No. Amount Description Accounts Payable Warrants A W Chesterton 49372 $ 928.16 Repair&Maintenance Services and/or Supplies AECOM Technical Services, Inc. 49361 39,074.98 Professional Services/Engineering Design Services Aerotek 49373 8,874.90 Professional Services/Temporary Services Ago IndustriesDBA So-Cal Sweeping 49601 980.00 Street Sweeping Services Airgas Safety,Inc. 49374 5,519.26 Safety,Security,Health Equipment,Supplies,and Services Airgas West 49375 343.05 Repair&Maintenance Services and/or Supplies Alliant Insurance Services 49362 356,539.96 Insurance Amtech Elevator Services 49544 1,035.00 Miscellaneous Services AppleOne Employment Service 49376 5,900.00 Professional Services/Temporary Services Applied Industrial Technology 49377 92.06 Repair&Maintenance Services and/or Supplies Aquatic Biosystems, Inc. 49545 138.00 Laboratory Services&Supplies Arcadis U.S.,Inc. 49378 10,000.00 Professional Services/Engineering Design Services AT&T Mobility II,L.L.C. 49381 399.98 Telecommunications AT&T Mobility II,L.L.C. 49382 8,208.73 Telecommunications AT&T Universal Biller 49379 2,631.67 Telecommunications AT&T 49380 32.65 Telecommunications Awards&Trophies Company 49546 23.71 Awards and Framing Services AWSI 49383 234.00 Professional Services-DOT Program Administration Barragan Corp. International 49384 1,200.00 Professional Organizations Meeting/Training/Membership Battery Systems, Inc. 49547 5,632.94 Repair&Maintenance Services and/or Supplies BC Wire Rope&Rigging 49385 230.34 Tools&Supplies Beach Wire and Cable 49548 458.48 Telecommunications Bee Man Pest Control, Inc. 49549 175.00 Pest Control Services Bently Nevada Inc. 49550 4,548.57 Repair&Maintenance Services and/or Supplies BHI Management Consulting 49386 1,232.10 Professional Services/Strategic Planning Black&Veatch Corporation 49551 2,834.43 Professional Services/Engineering Design Services Borthwick,Guy,Thibault, Inc. 49552 1,000.00 Professional Services Brooks Instrument Div.Emerson Electric 49387 2,355.24 Instrument Parts&Supplies Brown&Caldwell 49537 132,711.24 Professional Services/Engineering Design Services Bureau Veritas North America,Inc. 49388 1,959.00 Industrial Hygiene Services C.A.Short Company 49389 85.12 Safety,Security,Health Equipment,Supplies,and Services Calchamber/Calbizcenteral 49390 257.29 Books&Publications California Coastal Commission 49553 250.00 Governmental Agency Fees&Charges California Dept.of Child Support 49554 2,137.47 Judgments Payable California Recreation Company 49555 3,380.32 Boat Slip Rental-Nerissa Ocean Monitoring Vessel California Relocation Services,Inc. 49391 427.50 Miscellaneous Services-Moving/Relocation California Special District Association 49557 625.00 Professional Organizations Meeting/Training/Membership Callan Associates, Inc. 49392 4,231.75 Investment Advisory Services Carollo Engineers 49363 32,162.30 Professional Services/Engineering Design Services CASA 49393 425.00 Professional Organizations Meeting/Training/Membership CDW Government, Inc. 49394 4,081.15 Computers,Software/Hardware Chuck M.Forman 49622 376.26 Meeting/Training Expense Reimbursement City Clerk's Association of California 49395 150.00 Professional Organizations Meeting/Training/Membership City of Huntington Beach 49431 16,001.69 Water Use Clean Harbors Environmental Services 49396 9,036.61 Grit&Screenings;Hazard Waste Disposal Columbia Analytical Services 49397 1,320.00 Laboratory Services&Supplies Compressor Components of California 49398 1,800.00 Repair&Maintenance Services and/or Supplies Compressor Components of California 49556 8,582.29 Repair&Maintenance Services and/or Supplies EXHIBIT A fin/210/mm Page 1 of 6 7/18/2012 Claims Paid From 7/1/12 to 7/15/12 Vendor Warrant No. Amount Description Consumers Pipe&Supply Co. 49399 510.74 Repair&Maintenance Services and/or Supplies Converse Consultants 49400 6,493.50 Professional Services/Professional Services/Materials&Geotechnical Testing Cooperative Personnel Services 49403 426.65 Human Resources Services Corner Bakery Cafe(CBC) 49401 435.47 Catering Services Corporate Image Maintenance,Inc. 49538 36,215.00 Janitor&Household Service&Supplies Counterpart Enterprises, Inc. 49402 2,116.25 Repair&Maintenance Services and/or Supplies Court Order 49581 2,179.38 Judgments Payable Court Order 49584 150.00 Judgments Payable Court Order 49597 108.00 Judgments Payable Court Order 49621 912.50 Judgments Payable CSAC Excess Insurance Authority 49364 184,458.00 Insurance CSI Services, Inc. 49404 2,700.92 Professional Services CWEA Membership 49405 132.00 Professional Organizations Meeting/Training/Membership David R.Heinz 49532 168.60 Meeting/Training Expense Reimbursement Desert Pumps&Parts, Inc. 49365 30,958.17 Repair&Maintenance Services and/or Supplies Detection Instruments Corporation 49407 3,514.46 Electrical/Electronic Equipment,Parts&Repairs DLT&V Systems Engineering, Inc. 49406 2,354.00 Computer Applications&Services Dudek&Associates, Inc. 49558 4,241.41 Professional Services/Engineering Design Services Dwyer Instruments, Inc. 49408 513.14 Electrical/Electronic Equipment,Parts&Repairs Embee Performance LLC 49559 700.38 Repair&Maintenance Services and/or Supplies Employee Benefits Specialists,Inc. 49539 772,209.09 Reimbursed Prepaid Employee Medical&Dependent Care Employee Benefits Specialists,Inc. 49560 13,787.76 Reimbursed Prepaid Employee Medical&Dependent Care Enchanter,Inc. 49409 3,040.00 Vessel Services-Monitoring Vessel Nerissa Environmental&Occupational Risk Mgmt. 49410 4,000.00 Professional Services-Indoor Air Quality Consulting Ewing Irrigation 49411 335.92 Irrigation Repair&Maintenance Services and/or Supplies Express Lens Lab 49412 2,402.32 Safety,Security,Health Equipment,Supplies,and Services Fedex Corporation 49413 23.52 Freight Services Ferguson Waterworks 49414 272.39 Repair&Maintenance Services and/or Supplies Filterline Corporation 49415 360.50 Repair&Maintenance Services and/or Supplies Fisher Scientific 49561 1,060.40 Laboratory Services&Supplies FLW, Inc. 49416 2,191.83 Electrical/Electronic Equipment,Parts&Repairs Foundation for Cross Connection Control 49562 120.00 Professional Organizations Meeting/Training/Membership Fountain Valley AAA Auto Spa 49563 1,210.17 Autos,Trucks&Marine Equipment,Parts,Accessories&Services Franchise Tax Board 49564 972.89 Judgments Payable Franklin Covey 49565 78.31 Office Supplies Fuller Truck Accessories 49566 702.77 Autos,Trucks&Marine Equipment,Parts,Accessories&Services Ganahl Lumber Company 49417 11,127.69 Facilities,Maintenance,Services&Supplies General Petroleum 49418 4,883.60 Fuel and Lubricants Gerard Daniel Worldwide 49567 202.03 Repair&Maintenance Services and/or Supplies Glen Mills Inc. 49568 1,040.38 Laboratory Services&Supplies Global Automation Services,Inc. 49419 280.00 Repair&Maintenance Services and/or Supplies Golden State Water Company 49420 137.59 Water Use Golden West Window Service 49421 980.00 Facilities,Maintenance,Services&Supplies Golden West Window Service 49569 2,332.00 Facilities,Maintenance,Services&Supplies Govplace 49570 4,936.16 Computer Applications and Services Grainger, Inc. 49422 3,335.35 Repair&Maintenance Services and/or Supplies Grainger, Inc. 49571 2,519.25 Repair&Maintenance Services and/or Supplies Grating Pacific,Inc. 49572 3,387.66 Repair&Maintenance Services and/or Supplies Graybar Electric Company 49423 16,433.60 Electrical/Electronic Equipment,Parts&Repairs EXHIBIT A fin/210/mm Page 2 of 6 7/18/2012 Claims Paid From 7/1/12 to 7/15/12 Vendor Warrant No. Amount Description Graybar Electric Company 49573 1,062.31 Electrical/Electronic Equipment,Parts&Repairs Great Pacific Equipment Co. 49424 4,821.78 Autos,Trucks&Marine Equipment,Parts,Accessories&Services GRM Information Management Services 49574 665.92 Miscellaneous Services&Supplies Haaker Equipment Company 49425 1,134.13 Autos,Trucks&Marine Equipment,Parts,Accessories&Services Hach Company 49426 728.29 Laboratory Services&Supplies Harrington Industrial Plastics,Inc. 49427 1,964.79 Repair&Maintenance Services and/or Supplies Hasco Oil Co.,Inc. 49428 141.17 Fuel and Lubricants Hill Brothers 646 64,728.28 Chemicals,Water/Wastewater Treatment Hilti, Inc. 49429 2,586.45 Repair&Maintenance Services and/or Supplies Home Depot 49430 395.78 Miscellaneous Parts and Supplies Hyatt Legal Plans 49575 1,691.00 Professional Services-Legal ID Enhancements, Inc. 49576 1,425.00 Safety,Security,Health Equipment,Supplies,and Services Indiana Child Support Bureau 49577 290.00 Judgments Payable Industrial Hearing&Pulmonary Mgmt. 49432 4,800.00 Employee Medical Surveillance Services Industrial Threaded Products,Inc. 49433 826.22 Repair&Maintenance Services and/or Supplies Infrastructure Engineering Corp. 49578 202.14 Professional Services Ingram Products, Inc. 49579 393.72 Repair&Maintenance Services and/or Supplies Insight Public Sector,Inc. 49434 1,691.29 Computers,Software/Hardware Intercare Holdings Insurance Svcs.,Inc. 49435 4,116.67 Workers'Compensation Service Intl.Union of Oper.Eng.AFL CIO Local 501 49580 4,932.94 Dues Deductions Intratek Computer, Inc. 49436 1,651.33 Network/Server/Printer Maintenance Services Ironman Parts&Services 49437 156.37 Repair&Maintenance Services and/or Supplies James D.Herberg 49623 220.00 Meeting/Training Expense Reimbursement Jamison Engineering Contractors, Inc. 49438 3,260.00 Professional Services/Construction Support Services Jays Catering 49439 717.89 Catering Services JCI Jones Chemicals, Inc. 645 25,775.75 Chemicals,Water/Wastewater Treatment JCI Jones Chemicals, Inc. 649 14,331.52 Chemicals,Water/Wastewater Treatment John S.Anderson 49527 301.07 Meeting/Training Expense Reimbursement Kasai Consulting 49440 440.00 Professional Organizations Meeting/Training/Membership Katherine J.Edwards 49582 5,000.00 Human Resources Services Kemira Water Solutions 647 88,373.30 Chemicals,Water/Wastewater Treatment Kiewit/Mass,A Joint Venture 49370 113,571.40 Construction LA Testing 49441 197.00 Safety,Security,Health Equipment,Supplies,and Services Larry R.Crandall 49530 400.19 Meeting/Training Expense Reimbursement Lee&Ro, Inc. 49442 1,113.32 Professional Services/Engineering Design Services Lee&Ro, Inc. 49583 8,024.48 Professional Services/Engineering Design Services Lee&Ro, Inc. 49583 5,406.63 Professional Services/Engineering Design Services Lillestrand and Associates 49443 502.71 Professional Services Lucci's Gourmet Foods, Inc. 49444 150.94 Catering Services Luis Gasca 49531 100.00 Meeting/Training Expense Reimbursement Magnolia Air Compressor Company Inc. 49445 344.61 Repair&Maintenance Services and/or Supplies Mainline Information Systems 49540 125,729.42 Computer Applications&Services Malcolm Pirnie, Inc. 49446 15,066.74 Professional Services/Engineering Design Services Maria E.Ayala 49528 1,366.75 Meeting/Training Expense Reimbursement Maxim Security Systems 49585 2,937.12 Safety,Security,Health Equipment,Supplies,and Services McMaster-Carr Supply Co. 49447 852.33 Repair&Maintenance Services and/or Supplies Mettler-Toledo 49586 226.50 Computer Applications&Services Mid-West Associates, Inc. 49448 8,137.54 Repair&Maintenance Services and/or Supplies Mitchell Instrument Co. 49449 2,218.57 Tools&Supplies EXHIBIT A fin/210/mm Page 3 of 6 7/18/2012 Claims Paid From 7/1/12 to 7/15/12 Vendor Warrant No. Amount Description Moore Medical Inc. 49450 8.38 Medical Supplies Mooring Systems Inc. 49451 500.00 Laboratory Services&Supplies Morrow Meadows Corp. 49543 420,295.50 Construction MTM Recognition Corporation 49452 197.87 Service Awards NAS Northwestern Aquatic Sciences 49587 865.00 Laboratory Services&Supplies Ncompliance Services 49453 658.00 Professional Organizations Meeting/Training/Membership NEAC Compressor Services USA Inc. 49454 4,243.73 Repair&Maintenance Services and/or Supplies Neal Supply Co. 49455 3,119.04 Repair&Maintenance Services and/or Supplies Nicholas Oswald 49535 312.41 Meeting/Training Expense Reimbursement Ninyo&Moore 49588 3,266.50 Professional Services/Geotech&Material Testing Nirve Sports LTD 49456 324.32 Bicycle Purchases NRG Engine Services,L.L.C. 49457 2,745.14 Repair&Maintenance Services and/or Supplies OCEA 49589 672.75 Dues Deductible OCECO INC 49458 3,907.92 Repair&Maintenance Services and/or Supplies Olin Corporation 49459 12,588.69 Chemicals,Water/Wastewater Treatment OneSource Distributors, Inc. 49460 2,606.21 Electrical/Electronic Equipment,Parts&Repairs Orange County Auto Parts 49590 2,144.95 Truck Supplies Orange County Hose Company 49461 61.85 Miscellaneous Parts and Supplies Orange County Sanitation District 49536 1,551.68 Petty Cash Expense Orange County United Way 49591 40.00 Employee Contributions OSTS Inc. 49463 950.00 Professional Organizations Meeting/Training/Membership Oxygen Service Company 49464 1,120.90 Laboratory Services&Supplies Oxygen Service Company 49592 656.91 Laboratory Services&Supplies Pace Precision Products,Inc. 49465 5,223.72 Repair&Maintenance Services and/or Supplies Pacific Mechanical Supply 49466 2,177.82 Repair&Maintenance Services and/or Supplies Parker Supply Company 49467 652.79 Miscellaneous Parts and Supplies Parkhouse Tire,Inc. 49468 2,654.50 Autos,Trucks&Marine Equipment,Parts,Accessories&Services Parkhouse Tire,Inc. 49593 2,012.71 Autos,Trucks&Marine Equipment,Parts,Accessories&Services PCS Express, Inc. 49594 446.93 Courier Services Peace Officers Council of CA 49595 2,265.50 Dues Deductions,Supervisors&Professionals People and Processes, Inc. 49469 9,990.00 Professional Organizations Meeting/Training/Membership Pivot Interiors Inc. 49470 720.55 Office Supplies/Furniture PL Hawn Company,Inc. 49471 2,360.03 Repair&Maintenance Services and/or Supplies Polydyne,Inc. 648 56,212.08 Chemicals,Water/Wastewater Treatment Pongsakdi Cady 49529 106.74 Meeting/Training Expense Reimbursement Ponton Industries, Inc. 49472 835.30 Laboratory Services&Supplies Powerflo Products, Inc. 49473 1,764.01 Repair&Maintenance Services and/or Supplies Praxair Distribution, Inc. 49474 273.95 Laboratory Services&Supplies Precision Digital Corporation 49475 1,889.27 Repair&Maintenance Services and/or Supplies Precon Products 49476 1,400.75 Repair&Maintenance Services and/or Supplies Primary Source Office Furnishings, Inc. 49477 13,414.88 Minor Equipment/Furniture&Fixtures Primrose Ice Co.,Inc. 49478 105.00 Water&Ice Services Procare Work Injury Center 49479 1,382.34 Medical Services Projectline Technical Services,Inc. 49480 8,054.47 Professional Services/Engineering Design Services Prudential Overall Supply 49481 2,893.48 Uniforms Prudential Overall Supply 49596 3,054.69 Uniforms Quickstart Intelligence 49482 1,625.00 Professional Organizations Meeting/Training/Membership Red Wing Shoes 49483 1,202.19 Safety,Security,Health Equipment,Supplies,and Services Regents of the University of Calif. 49598 9,571.10 Meeting/Training Registration EXHIBIT A fin/210/mm Page 4 of 6 7/18/2012 Claims Paid From 7/1/12 to 7/15/12 Vendor Warrant No. Amount Description Regents of University of California 49599 15,769.00 Registration Retrofit Parts&Components,Inc. 49484 24.92 Repair&Maintenance Services and/or Supplies Riaz K.Moinuddin 49534 125.00 Meeting/Training Expense Reimbursement RMB Engineering&Sales,Inc. 49485 4,879.05 Electrical/Electronic Equipment,Parts&Repairs Royale Cleaners 49486 286.00 Miscellaneous Services RPM Electric Motors 49487 2,089.68 Repair&Maintenance Services and/or Supplies RSA Soil Products 49600 2,574.38 Miscellaneous Parts and Supplies Russell Sigler,Inc.dba Sigler Wholesale 49488 666.20 Electrical/Electronic Equipment,Parts&Repairs Sancon Engineering,Inc. 49366 217,000.00 Repair&Maintenance Services and/or Supplies Scale Datacom Llc 49541 389,788.45 Computers,Software/Hardware&Managed Services Scientific Instrument Services,Inc. 49490 255.31 Laboratory Services&Supplies Securitas Security Services USA, Inc. 49491 254.80 Safety,Security,Health Equipment,Supplies,and Services Shamrock Supply Co., Inc. 49492 5,324.21 Repair&Maintenance Services and/or Supplies Shureluck Sales&Engineering 49493 745.20 Repair&Maintenance Services and/or Supplies Sigma-Aldrich, Inc. 49494 401.69 Laboratory Services&Supplies Simon L.Watson 49624 379.98 Meeting/Training Expense Reimbursement Snap On Industrial 49495 224.27 Tools South Coast Environmental Co. 49489 1,228.57 Professional Services-Air Quality Monitoring Southern California Edison 49367 78,183.95 Utilities Southern Counties Lubricants 49496 4,959.88 Fuel and Lubricants Sparklett-Dallas 49497 2,238.68 Miscellaneous Services SPEX Certiprep,Inc. 49602 54.50 Laboratory Services&Supplies Staheli Trenchless Consultants,Inc. 49498 13,737.00 Staheli Trenchless Consultants Inc. Stantec Consulting Services, Inc. 49603 2,082.00 Professional Services/Surveying Staples 49499 1,757.40 Office Supplies STL Landscape,Inc. 49371 122,320.10 Construction Stratus Environmental,Inc. 49500 3,375.00 Professional Services/Groundwater Removal Stryper Technologies 49501 3,738.00 Computer Hardware&Software Sunset Industrial Parts 49502 1,790.84 Repair&Maintenance Services and/or Supplies Super Chem Corporation 49604 911.57 Repair&Maintenance Services and/or Supplies Support Product Services 49605 10,960.00 Repair&Maintenance Services and/or Supplies Teledyne/ISCO 49503 18,274.32 Laboratory Services&Supplies TestAmerica Ontario 49504 255.00 Laboratory Services&Supplies Tetra Tech, Inc. 49606 11,147.20 Professional Services/Engineering Design ServicesS The Cei Group, Inc. 49505 2,274.44 Repair&Maintenance Services and/or Supplies The Creative Group 49506 2,688.00 Professional Services/Temporary Services The Modal Shop, Inc. 49507 11,969.48 Electrical/Electronic Equipment,Parts&Repairs The Orange County Register 49462 375.40 Notices&Ads Thompson Industrial Supply, Inc. 49508 1,447.81 Repair&Maintenance Services and/or Supplies Thompson Industrial Supply, Inc. 49607 880.50 Repair&Maintenance Services and/or Supplies Tiano Construction 49608 7,220.00 Facilities,Maintenance,Services&Supplies Tim H.Hopkins 49533 143.75 Meeting/Training Expense Reimbursement Tony's Lock&Safe Service&Sales 49609 349.59 Repair&Maintenance Services and/or Supplies Toshiba Business Solutions USA Inc. 49509 414.22 Computers,Software/Hardware&Managed Services Total-Western, Inc. 49510 2,282.61 Repair&Maintenance Services and/or Supplies Total-Western, Inc. 49610 700.00 Repair&Maintenance Services and/or Supplies Townsend Public Affairs 49611 7,500.00 Professional Services-State Legislative Advocacy Tule Ranch/Magan Farms 49368 158,095.08 Biosolids Management TW Telecom Holdings, Inc. 49511 5,206.75 Telecommunications EXHIBIT A fin/210/mm Page 5 of 6 7/18/2012 Claims Paid From 7/1/12 to 7/15/12 Vendor Warrant No. Amount Description U Line 49512 44.32 Miscellaneous Parts and Supplies U S Bank 49612 8,575.00 Annual COP Administrative Fee United Parcel Service 49513 332.47 Freight Services Univar USA Inc 650 4,668.18 Chemicals,Water/Wastewater Treatment University Of Southern California 49613 9,593.67 Professional Services/Studies US Peroxide,L.L.C. 49369 152,045.29 Chemicals,Water/Wastewater Treatment US Peroxide,L.L.C. 49542 154,070.79 Chemicals,Water/Wastewater Treatment Verizon California 49514 632.63 Telecommunications Verizon Wireless 49515 1,606.73 Telecommunications Verne's Plumbing 49614 70.00 Plumbing Services&Supplies Vertech Industrial Systems,Llc 49615 10,730.94 Professional Services/Construction Consulting Services Village Nurseries 49616 394.68 Repair&Maintenance Services and/or Supplies Vision Financial Corporation 49516 1,224.24 Employee Voluntary Benefits Voyager Fleet Systems, Inc. 49617 24,179.05 Autos,Trucks&Marine Equipment,Parts,Accessories&Services VWR Scientific Products 49517 8,624.07 Laboratory Services&Supplies Water Environment Federation 49518 220.00 Professional Organizations Meeting/Training/Membership Waters Corporation 49618 6,845.00 Laboratory Services&Supplies Waxie Sanitary Supply 49519 987.62 Janitor&Household Service&Supplies WCR Incorporated 49520 271.94 Miscellaneous Services Wells Fargo Bank Escrow 23518600 49526 6,240.60 Construction,Retention West Coast Safety Supply Co. 49521 2,155.72 Safety,Security,Health Equipment,Supplies,and Services West Coast Switchgear,Inc. 49522 423.46 Electrical/Electronic Equipment,Parts&Repairs Weston Solutions, Inc. 49523 18,681.00 Laboratory Services&Supplies Westport Apparatus dba Breaker Supply 49524 1,173.40 Electrical/Electronic Equipment,Parts&Repairs Xerox Corporation 49619 1,352.61 Computers,Software/Hardware&Managed Services Yale/Chase Materials Handling, Inc. 49525 173.58 Electrical/Electronic Equipment,&Electric Cart Parts&Repairs Yale/Chase Materials Handling, Inc. 49620 2,909.90 Electrical/Electronic Equipment,&Electric Cart Parts&Repairs Total Accounts Payable-Warrants $ 4,472,150.53 Payroll Disbursements Employee Paychecks 49435 - 49494 $ 98,000.60 Biweekly Payroll(7/11/12) Employee Paychecks 49495 1,829.26 Interim Payroll-Reissue Direct Deposit as Check(7/11/12) Direct Deposit Statements 323046 -323619 1,384,672.35 Biweekly Payroll(7/11/12) Total Payroll Disbursements $ 1,484,502.21 Wire Transfer Payments OCSD Payroll Taxes&Contributions $ 771,896.11 Biweekly Payroll(7/11/12) Total Wire Transfer Payments $ 771,896.11 Total Claims Paid 7101/12-7/15112 $ 6,728,548.85 EXHIBIT A fin/210/mm Page 6 of 6 7/18/2012 Claims Paid From 7/16/12 to 7/31/12 Vendor Warrant No. Amount Description Accounts Payable Warrants A W Chesterton 49854 $ 3,438.71 Repair&Maintenance Services and/or Supplies Absolute Standards,Inc. 49652 795.00 Laboratory Services&Supplies Adamson Industries 49855 735.07 Safety,Security,Health Equipment,Supplies,and Services AECOM Technical Services, Inc. 49856 22,997.99 Professional Services/Engineering Design Services AECOM USA,Inc. 49625 28,074.19 Professional Services/Engineering Design Services Aerotek 49653 6,959.79 Professional Services/Temporary Services Air Liquide America Specialty Gases LLC 49654 199.60 Laboratory Services&Supplies Airgas Safety,Inc. 49655 1,335.61 Safety,Security,Health Equipment,Supplies,and Services Airgas Safety,Inc. 49835 103,189.86 Safety,Security,Health Equipment,Supplies,and Services Airgas USA,LLC 49857 118.76 Laboratory Services&Supplies Airgas West 49656 269.04 Repair&Maintenance Services and/or Supplies Airgas West 49858 2,144.41 Repair&Maintenance Services and/or Supplies Alhambra Foundry Co.,Ltd. 49859 12,369.70 Repair&Maintenance Services and/or Supplies Alliant Insurance Services 49626 575,889.00 Insurance Allied Electronics,Inc. 49657 132.08 Electrical/Electronic Equipment,Parts&Repairs Allied Electronics,Inc. 49860 52.27 Electrical/Electronic Equipment,Parts&Repairs Allied Packing&Rubber, Inc. 49861 73.40 Repair&Maintenance Services and/or Supplies American Express 49627 64,076.41 Purchasing Card Program for Miscellaneous Parts and Supplies American Express TVL Related Svcs Co.,Inc. 49658 3,089.17 Purchasing Card Program for Miscellaneous Travel Expenses American Public Works Association 49659 70.00 Professional Organizations Meeting/Training/Membership AppleOne Employment Service 49660 4,193.75 Professional Services/Temporary Services Applied Industrial Technology 49661 140.51 Repair&Maintenance Services and/or Supplies Applied Industrial Technology 49862 1,299.23 Repair&Maintenance Services and/or Supplies Argus-Hazco 49663 532.29 Repair&Maintenance Services and/or Supplies Arturo Diaz 49827 132.00 Meeting/Training Expense Reimbursement Ashbrook Simon Hartley Operations,L.P. 49628 37,105.00 Repair&Maintenance Services and/or Supplies ASSE American Society of Safety Engineers 49664 180.00 Professional Organizations Meeting/Training/Membership AT&T 49853 238.78 Telecommunications AT&T Long Distance. 49863 27.79 Telecommunications AT&T Mobility II,L.L.C. 49666 459.85 Telecommunications AT&T Universal Biller 49665 121.88 Telecommunications ATCC:Amer.Type Culture Collect 49864 514.50 Laboratory Services&Supplies Awards&Trophies Company 49667 53.88 Awards and Framing Services Battery Specialties 49669 766.62 Batteries,Various Battery Specialties 49865 710.74 Batteries,Various Battery Systems, Inc. 49866 151.11 Repair&Maintenance Services and/or Supplies Bee Man Pest Control, Inc. 49670 211.65 Pest Control Services Bell Pipe&Supply Co. 49671 319.73 Repair&Maintenance Services and/or Supplies Bentley Systems, Inc. 49672 655.42 Software Maintenance Agreement Beyond Trust Corporation 49673 17,900.00 Computer Applications and Services Bickmore Risk Services 49836 55,050.00 Professional Organizations Meeting/Training/Membership Black&Veatch Corporation 49629 102,754.24 Professional Services/Engineering Design Services Black&Veatch Corporation 49837 64,790.62 Professional Services/Engineering Design Services Black&Veatch Corporation 49837 134,771.45 Professional Services/Engineering Design Services Black&Veatch Corporation 49837 830.74 Professional Services/Engineering Design Services Bonterra Consulting,L.L.C. 49867 989.00 Professional Services/Engineering Design Services BPI Brea LLC 49630 29,906.29 Sewer User Refund EXHIBIT B fin/210/mm Page 1 of 9 817/2012 Claims Paid From 7/16/12 to 7/31/12 Vendor Warrant No. Amount Description Brea Imperial,Inc. 49674 2,500.00 Miscellaneous Services Brent M.Hall 49829 267.00 Meeting/Training Expense Reimbursement Brithinee Electric 49868 2,924.16 Electrical/Electronic Equipment,Parts&Repairs Brown&Caldwell 49838 290,917.94 Professional Services/Engineering Design Services Brown&Caldwell 49838 173,751.26 Professional Services/Engineering Design Services Bureau Veritas North America,Inc. 49675 1,048.10 Industrial Hygiene Services Bureau Veritas North America,Inc. 49869 2,446.50 Industrial Hygiene Services California Barricade Rentals 49676 12,665.00 Miscellaneous Services California Dept.of Child Support 49870 2,137.47 Judgments Payable California Political Week,Inc. 49871 70.00 Professional Organizations Meeting/Training/Membership California Relocation Services,Inc. 49677 450.00 Miscellaneous Services-Moving/Relocation Cameron Compression Systems 49678 10,396.14 Repair&Maintenance Services and/or Supplies Careplus Medical Center 49872 220.00 Human Resource Services Carollo Engineers 49632 79,430.64 Professional Services/Engineering Design Services Carollo Engineers 49839 77,688.97 Professional Services/Engineering Design Services Carollo Engineers 49631 49,215.96 Professional Services Carollo Engineers 49873 14,263.48 Professional Services CASA 49874 1,275.00 Professional Organizations Meeting/Training/Membership CCP Industries. 49875 10,208.70 Janitor&Household Service&Supplies City of Fountain Valley 49633 47,320.63 Water Use City of Huntington Beach 49723 11.08 Water Use City of Huntington Beach 49876 250.00 Water Use City of Huntington Beach 49909 354.06 Water Use City of Newport Beach 49931 303.15 Water Use City of Seal Beach 49959 152.40 Water Use Clean Harbors Environmental Services 49679 4,165.20 Grit&Screenings;Hazard Waste Disposal Clean Harbors Environmental Services 49877 2,718.88 Grit&Screenings;Hazard Waste Disposal Coast Rubber Stamp,Mfg. 49878 177.79 Stationery&Office Supplies Compline,LLC 49879 600.00 Professional Organizations Meeting/Training/Membership Compressor Components of California 49634 32,355.17 Repair&Maintenance Services and/or Supplies Constellation Newenergy Gas Division LLC 49680 13,959.18 Natural Gas Consumers Pipe&Supply Co. 49880 1,159.02 Repair&Maintenance Services and/or Supplies Controlled Motion Solutions 49681 274.71 Repair&Maintenance Services and/or Supplies Corner Bakery Cafe(CBC) 49683 138.47 Catering Services Cornerstone Ondemand, Inc. 49684 21,700.00 Professional Services/I.T. Cotton Point Design,Inc.dba Power Design 49881 8,130.82 Electrical/Electronic Equipment,Parts&Repairs County of Orange Auditor Controller 49685 16.50 Governmental Agency Fees&Charges County of Orange Auditor Controller 49686 462.00 Governmental Agency Fees&Charges Court Order 49918 2,179.38 Judgments Payable Court Order 49922 150.00 Judgments Payable Court Order 49953 108.00 Judgments Payable Court Order 49988 912.50 Judgments Payable CR&R, Inc. 49687 2,271.15 Waste Disposal Crane Veyor Corp. 49688 2,948.00 Repair&Maintenance Services and/or Supplies CS-AMSCO 49689 19,604.81 Repair&Maintenance Services and/or Supplies CSI Services, Inc. 49690 1,102.12 Professional Services CWEA Membership 49882 132.00 Professional Organizations Meeting/Training/Membership David Gutoff 49691 225.00 Laboratory Services&Supplies EXHIBIT B fin/210/mm Page 2 of 9 817/2012 Claims Paid From 7/16/12 to 7/31/12 Vendor Warrant No. Amount Description DDB Engineering,Inc. 49692 1,083.77 Professional Services-Advocacy DeGuelle Glass Co.,Inc. 49693 235.98 Repair&Maintenance Services and/or Supplies Deirdre E.Bingman 49826 131.39 Meeting/Training Expense Reimbursement DLT&V Systems Engineering, Inc. 49694 11,539.50 Computer Applications&Services DTSC(Dept.of Toxic Substances Control) 49883 549.00 Governmental Agency Fees&Charges DTSC(Dept.of Toxic Substances Control) 49884 97.50 Governmental Agency Fees&Charges Dudek&Associates, Inc. 49695 21,183.74 Professional Services/Engineering Design Services Dyntek Services,Inc. 49696 3,000.00 Computer Applications&Services Elite Equipment Inc. 49697 409.66 Repair&Maintenance Services and/or Supplies Employee Benefits Specialists,Inc. 49698 797.50 Reimbursed Prepaid Employee Medical&Dependent Care Employee Benefits Specialists,Inc. 49885 13,904.68 Reimbursed Prepaid Employee Medical&Dependent Care Enchanter,Inc. 49699 2,280.00 Vessel Services-Monitoring Vessel Nerissa Enchanter,Inc. 49886 3,040.00 Vessel Services-Monitoring Vessel Nerissa Enertech Environmental 49635 467,315.92 Biosolids Management ENS Resources, Inc. 49700 7,500.00 Professional Services-Federal Advocacy Environ Strategy Consultants,Inc. 49887 6,700.00 Professional Services-Quarterly Sampling of Groundwater Monitoring Wells in the Auto Environmental Engineering&Contracting 49888 1,800.00 Professional Services/Specialty Course Audits Environmental Resource Associates 49701 2,514.13 Laboratory Services&Supplies Environmental Resource Associates 49889 364.05 Laboratory Services&Supplies Envirotech Pumpsystems,Inc. 49987 984.00 Repair&Maintenance Services and/or Supplies Ewing Irrigation 49702 742.96 Irrigation Repair&Maintenance Services and/or Supplies Excel Door&Gate Co., Inc. 49703 123.75 Repair&Maintenance Services and/or Supplies Express Lens Lab 49890 948.09 Safety,Security,Health Equipment,Supplies,and Services First American Corelogic 49682 342.00 Software Maintenance Agreement Fisher Scientific 49704 4,203.91 Laboratory Services&Supplies Fisher Scientific 49892 1,360.02 Laboratory Services&Supplies Fleetmatics USA,LLC 49893 600.00 Professional Services-Legal/Employee Relations Fleming Environmental, Inc. 49894 300.00 Repair&Maintenance Services and/or Supplies Forestry Suppliers 49895 2,229.95 Laboratory Services&Supplies Franchise Tax Board 49896 972.90 Judgments Payable Franklin Air Conditioning&Heating Co 49897 6,034.63 Repair&Maintenance Services and/or Supplies Franklin Covey 49705 80.90 Office Supplies Fuller Truck Accessories 49706 1,242.33 Autos,Trucks&Marine Equipment,Parts,Accessories&Services Garratt Callahan Company 49898 5,533.43 Chemicals,Water/Wastewater Treatment Gates Fiberglass Installers 49707 7,524.00 Repair&Maintenance Services and/or Supplies General Petroleum 49708 7,596.60 Fuel and Lubricants Getinge Castle 49899 440.01 Laboratory Services&Supplies GHD,L.L.C. 49709 7,350.00 Professional Services/Engineering Design Services Golden Bell Products 49636 27,523.00 Miscellaneous Parts and Supplies Golden State Overnight Delivery Service 49710 157.14 Courier Services Golden State Overnight Delivery Service 49900 383.90 Courier Services Golden West Machine, Inc. 49711 20,885.00 Repair&Maintenance Services and/or Supplies Golden West Machine, Inc. 49901 1,500.00 Repair&Maintenance Services and/or Supplies Government Finance Officers Association 49998 635.00 Professional Organizations Meeting/Training/Membership Grainger, Inc. 49712 2,328.18 Repair&Maintenance Services and/or Supplies Grainger, Inc. 49902 2,523.33 Repair&Maintenance Services and/or Supplies Graybar Electric Company 49903 14,926.47 Electrical/Electronic Equipment,Parts&Repairs Greentech Landscape,Inc 49713 9,372.00 Landscape Maintenance Services EXHIBIT B fin/210/mm Page 3 of 9 817/2012 Claims Paid From 7/16/12 to 7/31/12 Vendor Warrant No. Amount Description Greentech Landscape,Inc 49904 1,690.00 Landscape Maintenance Services Guarantee Records Management 49714 774.29 Professional Services-Document Storage&Shredding Hach Company 49716 7,008.00 Laboratory Services&Supplies Hach Company 49717 788.67 Laboratory Services&Supplies Hach Company 49905 310.23 Laboratory Services&Supplies Harrington Industrial Plastics,Inc. 49718 16.27 Repair&Maintenance Services and/or Supplies Harrington Industrial Plastics,Inc. 49906 222.27 Repair&Maintenance Services and/or Supplies Hasler,Inc. 49719 64.65 Postage Meter Rental HD Supply 49907 10,769.62 Mechanical Parts&Supplies HDR Engineering, Inc. 49637 85,552.75 Professional Services/Engineering Design Services HDR Engineering, Inc. 49840 36,188.17 Professional Services/Engineering Design Services Helix Electric, Inc. 49647 44,070.74 Construction Hill Brothers 651 35,883.62 Chemicals,Water/Wastewater Treatment Home Depot 49720 154.02 Miscellaneous Parts and Supplies Home Depot 49908 605.80 Miscellaneous Parts and Supplies Hope Health/IHAC 49721 560.27 Benefits Hub Auto Supply 49722 1,343.73 Autos,Trucks&Marine Equipment,Parts,Accessories&Services Ian M.Brown 49668 132.00 Meeting/Training Expense Reimbursement Indiana Child Support Bureau 49910 290.00 Judgments Payable Industrial Threaded Products,Inc. 49724 3,684.65 Repair&Maintenance Services and/or Supplies Inorganic Ventures, Inc. 49725 1,021.09 Laboratory Services&Supplies Intercare Holdings Insurance Svcs.,Inc. 49911 8,616.67 Workers'Compensation Service International Business Machines 49726 6,135.21 Computer Applications&Services Intl.Union of Oper.Eng.AFL CIO Local 501 49912 4,908.69 Dues Deductions Intratek Computer, Inc. 49913 442.40 Network/Server/Printer Maintenance Services IPMC c/o Parsons 49638 359,163.00 Professional Services/Temporary Services Irvine Ranch Water District 49727 10.54 Water Use Irvine Ranch Water District 49914 62.01 Water Use J F Shea Construction,Inc. 49648 1,240,171.47 Construction J F Shea Construction,Inc. 49849 339,331.45 Construction J R Filanc Construction 49850 867,908.83 Construction James G.Tintle 49832 512.94 Meeting/Training Expense Reimbursement James G.Tintle 49997 172.14 Meeting/Training Expense Reimbursement Jamison Engineering Contractors, Inc. 49728 3,192.00 Professional Services/Construction Support Services Jamison Engineering Contractors, Inc. 49915 5,125.45 Professional Services/Construction Support Services Jays Catering 49729 626.30 Catering Services JCI Jones Chemicals, Inc. 653 17,860.63 Chemicals,Water/Wastewater Treatment JCI Jones Chemicals, Inc. 656 22,625.74 Chemicals,Water/Wastewater Treatment JLM Systems Limited 49916 1,525.00 Repair&Maintenance Services and/or Supplies Johnny J.Rocha 49996 190.00 Meeting/Training Expense Reimbursement Johnstone Supply 49730 177.56 Repair&Maintenance Services and/or Supplie Johnstone Supply 49917 3,931.92 Repair&Maintenance Services and/or Supplies Kanawha Insurance Company 49919 2,172.41 Voluntary Benefits-SSTD Insurance Kasai Consulting 49731 440.00 Professional Organizations Meeting/Training/Membership Kemira Water Solutions 652 195,357.20 Chemicals,Water/Wastewater Treatment Kemira Water Solutions 655 106,755.94 Chemicals,Water/Wastewater Treatment Kiewit Infrastructure West Co. 49649 334,227.10 Construction Kiewt/Mass,A Joint Venture 49651 80,508.99 Construction EXHIBIT B fin/210/mm Page 4 of 9 817/2012 Claims Paid From 7/16/12 to 7/31/12 Vendor Warrant No. Amount Description Koff&Associates,Inc. 49732 472.50 Professional Services/Comp&Class Study LA Testing 49920 33.00 Safety,Security,Health Equipment,Supplies,and Services Labware, Inc. 49733 9,000.00 Repair&Maintenance Services and/or Supplie Lee&Ro, Inc. 49921 368.56 Professional Services/Engineering Design Services Liberty Mutual Claims 49734 1,625.83 Insurance Lillestrand and Associates 49735 2,701.90 Professional Services Lionakis 49736 5,053.00 Professional Services/Architectural and Landscaping Consulting Services Mail Dispatch,LLC 49923 314.70 Mail Delivery Service Mainline Information Systems 49737 6,092.00 Computer Applications&Services Malcolm Pirnie, Inc. 49841 89,667.34 Professional Services/Engineering Design Services Mandic Motors 49738 450.00 Autos,Trucks&Marine Equipment,Parts,Accessories&Services Marcus G.Lambertz 49995 100.00 Employee Computer Loan Program Margil Jimenez 49830 134.64 Meeting/Training Expense Reimbursement Marvac Electronics 49924 29.01 Electrical/Electronic Equipment,Parts&Repairs Matt Chlor,Inc. 49925 1,703.59 Repair&Maintenance Services and/or Supplies Maxim Security Systems 49926 19,544.47 Safety,Security,Health Equipment,Supplies,and Services McMaster-Carr Supply Co. 49739 602.90 Repair&Maintenance Services and/or Supplies McMaster-Carr Supply Co. 49927 133.93 Repair&Maintenance Services and/or Supplies Mesa Consolidated Water District 49928 26.77 Water Use Michael Asner Consulting 49740 4,520.10 Professional Services Michael I.Gold 49993 310.11 Meeting/Training Expense Reimbursement Michael T.Dorman 49828 187.50 Meeting/Training Expense Reimbursement Minako America Corporation 49851 447,120.00 Construction Mine Safety Appliance 49741 3,582.11 Electrical/Electronic Equipment,Parts&Repairs MTM Recognition Corporation 49742 1,104.36 Service Awards MWH Americas,Inc. 49842 70,886.05 Professional Services/Engineering Design Services NEAC Compressor Services USA Inc. 49929 3,695.92 Repair&Maintenance Services and/or Supplies Neal Supply Co. 49743 435.85 Repair&Maintenance Services and/or Supplies NetworkFleet, Inc. 49744 2,443.55 Software Maintenance Agreement Newark Electronics 49930 304.98 Electrical/Electronic Equipment,Parts&Repairs Nickey Petroleum Co., Inc. 49745 1,524.36 Fuel and Lubricants Ninyo&Moore 49746 5,825.00 Professional Services/Geotech&Material Testing Nirve Sports LTD 49932 967.14 Bicycle Purchases Norman A.Traub Associates 49933 5,131.50 Legal Services NPELRA Annual Training Conference 49747 399.00 Professional Organizations Meeting/Training/Membership OCB Reprographics 49662 23,793.78 Printing/Reprographics Services OCEA 49934 663.00 Dues Deductible O'Connell Engineering&Construction, Inc. 49639 25,350.00 Repair&Maintenance Services and/or Supplies Office Depot 49748 1,922.04 Office Supplies Office Depot 49935 660.97 Office Supplies OI Analytical 49749 4,416.74 Laboratory Services&Supplies Olin Corporation 49750 5,573.06 Chemicals,Water/Wastewater Treatment OneSource Distributors, Inc. 49751 2,820.46 Electrical/Electronic Equipment,Parts&Repairs OneSource Distributors, Inc. 49936 441.03 Electrical/Electronic Equipment,Parts&Repairs Oracle America Inc. 49752 21,354.51 Software Maintenance Agreement Orange Coast Auto Body,Inc. 49753 1,509.46 Autos,Trucks&Marine Equipment,Parts,Accessories&Services Orange County Auto Parts 49937 182.10 Truck Supplies Orange County Council of Governments 49754 7,500.00 Professional Organizations Meeting/Training/Membership EXHIBIT B fin/210/mm Page 5 of 9 817/2012 Claims Paid From 7/16/12 to 7/31/12 Vendor Warrant No. Amount Description Orange County Sanitation District 49999 1,570.19 Petty Cash Expense Orange County United Way 49938 40.00 Employee Contributions Orange County Vector Control District 49939 164.48 Pest Control Orange County Water District 49843 81,546.25 GAP Water Oxygen Service Company 49755 156.39 Laboratory Services&Supplies Pacific Mechanical Supply 49940 6,894.38 Repair&Maintenance Services and/or Supplies Parkhouse Tire,Inc. 49756 1,116.24 Autos,Trucks&Marine Equipment,Parts,Accessories&Services PC Mall Gov 49757 9,439.69 Software Maintenance Agreement PCS Express, Inc. 49758 152.76 Courier Services Peace Officers Council of CA 49941 2,265.50 Dues Deductions,Supervisors&Professionals Peerless Wiping Materials Co. 49942 1,782.40 Janitor&Household Service&Supplies PEI Genesis 49759 250.00 Repair&Maintenance Services and/or Supplies Performance Pipeline Technologies 49760 9,100.80 Professional Services/CCTV Inspection/Sewerline Cleaning PL Hawn Company,Inc. 49761 942.34 Repair&Maintenance Services and/or Supplies PL Hawn Company,Inc. 49943 2,459.50 Repair&Maintenance Services and/or Supplies Planetbids, Inc. 49762 903.00 Computer Applications&Services Polydyne,Inc. 657 18,662.64 Chemicals,Water/Wastewater Treatment Ponton Industries, Inc. 49944 331.27 Laboratory Services&Supplies Port Supply 49763 251.46 Autos,Trucks&Marine Equipment,Parts,Accessories&Services Port Supply 49945 48.71 Autos,Trucks&Marine Equipment,Parts,Accessories&Services Primrose Ice Co.,Inc. 49764 446.25 Water&Ice Services Primrose Ice Co.,Inc. 49946 105.00 Water&Ice Services Printing Connection, Inc. 49765 377.35 Printing/Reprographics Services Procare Work Injury Center 49947 270.00 Medical Services Process Instruments&Controls,LLC 49948 3,680.72 Electrical/Electronic Equipment,Parts&Repairs Projectline Technical Services,Inc. 49950 531.50 Professional Services/Engineering Design Services Projects Partners 49640 27,308.50 Professional Services/Temporary Employment Services Projects Partners 49949 1,656.00 Professional Services/Temporary Employment Services Prudential Overall Supply 49951 3,282.28 Uniforms Q Air-Calif.Div.Pump Engineering 49766 3,732.41 Repair&Maintenance Services and Supplies Quinn Power Systems 49767 223.43 Autos,Trucks&Marine Equipment,Parts,Accessories&Services Rainbow Disposal Co. 49768 586.39 Waste Disposal Raymond Handling Solutions, Inc. 49769 17,116.09 Material Handling Tools&Equipment RBF Consulting 49770 4,780.07 Professional Services/Engineering Design Services Reliastar 49771 3,727.09 Voluntary Employee Life&Cancer Insurance Remote Sensing Solutions Inc. 49641 59,960.80 Professional Services/Regional Ocean Modeling System(ROMS) Restek Corp. 49954 745.47 Laboratory Services&Supplies RF MacDonald Co. 49952 153.06 Repair&Maintenance Services and/or Supplies RMB Engineering&Sales,Inc. 49955 3,658.77 Electrical/Electronic Equipment,Parts&Repairs RMS Engineering&Design,Inc. 49772 16,020.00 Professional Services/Engineering Design Services RMS Engineering&Design,Inc. 49956 4,920.00 Professional Services/Engineering Design Services Robert Holdman 49715 358.13 Meeting/Training Expense Reimbursement Roken Industries Inc 49773 1,800.46 Repair&Maintenance Services and/or Supplies Roto Rooter NOC#11 49774 448.90 Repair&Maintenance Services and/or Supplies Royale Cleaners 49775 126.80 Miscellaneous Services Royale Cleaners 49957 49.70 Miscellaneous Services RSA Soil Products 49776 2,251.13 Miscellaneous Parts and Supplies Safety-Kleen 49958 104.79 Repair&Maintenance Services and/or Supplies EXHIBIT B fin/210/mm Page 6 of 9 8n/2012 Claims Paid From 7/16/12 to 7/31/12 Vendor Warrant No. Amount Description Sancon Engineering,Inc. 49777 24,127.00 Repair&Maintenance Services and/or Supplies SARBS-CWEA 49778 50.00 Professional Organizations Meeting/Training/Membership-California Water Environmen Schwing Bioset 654 10,429.58 Repair&Maintenance Services and/or Supplies Science Applications Intl.Corp. 49779 4,902.00 Professional Services/Engineering Design Services Securitas Security Services USA, Inc. 49844 26,999.18 Safety,Security,Health Equipment,Supplies,and Services Shamrock Supply Co., Inc. 49780 5,419.83 Repair&Maintenance Services and/or Supplies Shortridge Instruments, Inc. 49781 850.51 Repair&Maintenance Services and/or Supplies Shureluck Sales&Engineering 49782 388.71 Repair&Maintenance Services and/or Supplies Siemens Water Technologies Corp. 49783 1,431.74 Repair&Maintenance Services and/or Supplies Sigma-Aldrich, Inc. 49784 198.42 Laboratory Services&Supplies SKC West,Inc. 49785 147.13 Laboratory Services&Supplies Smardan Supply Company 49960 201.46 Repair&Maintenance Services and/or Supplies Smith Pipe&Supply,Inc. 49961 116.37 Facilities,Maintenance,Services&Supplies So.Cal Gas Company 49786 15,552.33 Utilities Southern California Coastal Water 49642 400,000.00 Joint Powers Agreement Southern California Edison 49643 454,934.03 Utilities Southern California Edison 49787 1,872.07 Utilities Sparklett-Dallas 49788 1,458.51 Miscellaneous Services SSPC The Society for Protective Coating 49789 95.00 Professional Organizations Meeting/Training/Membership St.Croix Sensory, Inc. 49790 2,310.00 Olfactometry Testing Services Staheli Trenchless Consultants Inc. 49962 5,928.75 Construction Staples 49791 2,761.74 Office Supplies State Board of Equalization 49963 5,818.00 Governmental Agency Fees&Charges State Board of Equalization 50000 46,765.00 Governmental Agency Fees&Charges STL Landscape,Inc. 49852 38,752.40 Construction Summit Steel 49792 2,924.39 Repair&Maintenance Services and/or Supplies Summit Steel 49964 404.28 Repair&Maintenance Services and/or Supplies Synagro West, Inc. 49644 672,035.01 Biosolids Management Synagro West, Inc. 49834 219.43 Biosolids Management Synagro West, Inc. 49845 193,236.72 Biosolids Management TCH Associates, Inc. 49793 5,412.88 Laboratory Services&Supplies Teledyne/ISCO 49794 226.28 Laboratory Services&Supplies TestAmerica Ontario 49795 1,814.00 Laboratory Services&Supplies TestAmerica Ontario 49965 350.00 Laboratory Services&Supplies The Creative Group 49796 2,688.00 Professional Services/Temporary Services The Fire X-Tinguisher Service Co. 49891 710.83 Safety,Security,Health Equipment,Supplies,and Services The Standard Insurance Company 49966 2,472.50 Disability Insurance The Trane Company 49972 504.36 Repair&Maintenance Services and/or Supplies The Unisource Corporation 49806 852.30 Paper&Office Supplies Theodore Robins Ford 49797 30.41 Autos,Trucks&Marine Equipment,Parts,Accessories&Services Thermo Electron North America,L.L.C. 49967 472.14 Laboratory Services&Supplies Thermo Labsystems Inc. 49798 15,366.23 Laboratory Services&Supplies Thompson Industrial Supply, Inc. 49799 5,144.71 Repair&Maintenance Services and/or Supplies Thompson Industrial Supply, Inc. 49968 430.93 Repair&Maintenance Services and/or Supplies Tiano Construction 49800 720.00 Facilities,Maintenance,Services&Supplies Tim H.Hopkins 49994 132.00 Meeting/Training Expense Reimbursement Time Warner Communications 49969 59.17 Telecommunications Tony S.Lee 49831 122.33 Meeting/Training Expense Reimbursement EXHIBIT B fin/210/mm Page 7 of 9 817/2012 Claims Paid From 7/16/12 to 7/31/12 Vendor Warrant No. Amount Description Tony's Lock&Safe Service&Sales 49970 315.04 Repair&Maintenance Services and/or Supplies Toshiba Business Solutions USA Inc. 49971 1,042.86 Computers,Software/Hardware&Managed Services Tran Consulting Engineers 49801 12,381.99 Professional Services/Engineering Design Services Tremco Incorporated 49802 2,615.00 Repair&Maintenance Services and/or Supplies Tropical Plaza Nursery,Inc. 49973 12,497.50 Landscape Maintenance Services Truck&Auto Supply,Inc. 49803 139.61 Autos,Trucks&Marine Equipment,Parts,Accessories&Services Tule Ranch/Magan Farms 49645 182,931.37 Biosolids Management Tule Ranch/Magan Farms 49846 53,320.05 Biosolids Management Two Wheels One Planet 49974 275.29 Autos,Trucks&Marine Equipment,Parts,Accessories&Services Underground Service Alert of So.Calif 49804 1,651.50 Professional Services-Dig Alert Notification Service Underground Service Alert of So.Calif 49976 1,438.50 Professional Services-Dig Alert Notification Service Union Bank Escrow No#23861 49650 65,009.02 Construction Union Bank of California 49805 763.85 Banking Services Union Bank of California Escrow 49992 17,859.55 Construction,Retention United Parcel Service 49807 135.29 Freight Services United Parcel Service 49977 914.98 Freight Services United States Postal Service 49975 5,000.00 Postage US Equipment Co., Inc. 49978 1,174.49 Repair&Maintenance Services and/or Supplies US Peroxide,L.L.C. 49847 97,234.34 Chemicals,Water/Wastewater Treatment V&A Consulting Engineers 49808 16,527.85 Professional Services Valin Corporation 49979 3,679.55 Repair&Maintenance Services and/or Supplies Verizon Wireless 49809 18.32 Telecommunications Verne's Plumbing 49810 4,621.65 Plumbing Services&Supplies Verne's Plumbing 49980 5,370.00 Plumbing Services&Supplies Village Nurseries 49981 659.64 Repair&Maintenance Services and/or Supplies Vision Internet Providers, Inc 49982 15,372.00 Professional Services/Web Design Services Vortex Corp. 49811 1,129.30 Repair&Maintenance Services and/or Supplies Vortex Corp. 49983 1,309.01 Repair&Maintenance Services and/or Supplies Vossler&Company 49812 436.88 Repair&Maintenance Services and/or Supplies VWR Scientific Products 49813 217.78 Laboratory Services&Supplies VWR Scientific Products 49984 2,368.66 Laboratory Services&Supplies Wastewater Technology Trainers 49814 865.00 Professional Organizations Meeting/Training/Membership Water Environment Federation 49815 220.00 Professional Organizations Meeting/Training/Membership Water Environment Federation 49985 220.00 Professional Organizations Meeting/Training/Membership Waters Corporation 49816 1,785.66 Laboratory Services&Supplies Waxie Sanitary Supply 49817 465.06 Janitor&Household Service&Supplies Waxie Sanitary Supply 49986 160.13 Janitor&Household Service&Supplies Wells Fargo Bank 49825 17,590.90 Construction,Retention Wells Fargo Bank Escrow23861100 Kiewit 49833 1,756.55 Construction,Retention West Coast Arborists,Inc. 49818 8,900.00 Landscape Maintenance Services West Coast Safety Supply Co. 49819 3,936.23 Safety,Security,Health Equipment,Supplies,and Services West Lite Supply Company,Inc. 49820 45.31 Electrical/Electronic Equipment,Parts&Repairs Western Blue/Insight/Hewlett Packard 49821 22,243.16 Computers,Software/Hardware Wondries Fleet Group 49646 37,751.56 Vehicle Purchases Woodruff Spradlin&Smart 49848 84,832.16 Professional Services-Legal Xerox Corporation 49822 20,247.82 Computers,Software/Hardware&Managed Services Yale/Chase Materials Handling, Inc. 49823 60.09 Electrical/Electronic Equipment,&Electric Cart Parts&Repairs 1-800-Conference(R) 49989 44.53 Telecommunications EXHIBIT B fin/210/mm Page 8 of 9 8n/2012 Claims Paid From 7116/12 to 7/31/12 Vendor Warrant No. Amount Description 24 Hour Fire Protection, Inc. 49990 10,000.00 Repair&Maintenance Services and/or Supplies 3CMA 49991 1,100.00 Professional Organizations Meeting/Training/Membership 3D Instruments L.L.C. 49824 995.18 Instrument Parts&Supplies Total Accounts Payable-Warrants $ 10,441,795.00 Payroll Disbursements Employee Paychecks 49496 - 49532 $ 84,993.13 Biweekly Payroll(7/25/12) Employee Paychecks 49533 4,373.00 Interim Payroll-Pymt to Employee on Leave(7/25/12) Employee Paychecks 49534 3,339.15 Interim Payroll-Retirement(7/26/12) Employee Paychecks 49535 28,659.85 Interim Payroll-Retirement Leave Payout(7/26/12)' Employee Paychecks 49563 1,992.22 Interim Payroll-Direct Deposit Item Returned,Reissued(7/30/12) Direct Deposit Statements 323620 -624182 1,406,326.22 Biweekly Payroll(7/25/12) Total Payroll Disbursements $ 1,529,683.57 *Check numbers 49536-49562 used for future period. Wire Transfer Payments OCSD Payroll Taxes&Contributions $ 784,913.61 Biweekly Payroll(7/25/12) Union Bank of California 1,822,776.61 Series 2007A Certificates of Participation Interest Payment Union Bank of California 6,919,279.78 Series 2007E Certificates of Participation Interest Payment Union Bank of California 10,647,804.81 Series 20011A Certificates of Participation Principal&Interest Payment Union Bank of California 1,338,691.82 Series 20012A Certificates of Participation Interest Payment US Bank 6,921,528.15 Series 2008A Refunding Certificates of Participation Principal and Interest Payment US Bank 860,369.47 Series 2008E Refunding Certificates of Participation Principal and Interest Payment US Bank 4,548,495.63 Series 2009A Refunding Certificates of Participation Interest Payment US Bank 2,228,950.56 Series 2010A Revenue Obligation BABS Interest Payment US Bank 5,018,286.28 Series 2010C Revenue Obligation BABS Interest Payment Total Wire Transfer Payments $ 41,091,096.72 Total Claims Paid 7/16/12-7/31/12 $ 53,062,575.29 EXHIBIT B fin/210/mm Page 9 of 9 8/7/2012 BOARD OF DIRECTORS Meeting Date To Bd. of Dir. 08/22/12 AGENDA REPORT Item Number Item Number 3 Orange County Sanitation District FROM: James D. Ruth, General Manager Originator: Ed Torres, Director of Operations and Maintenance SUBJECT: PLANT NO. 2 OXYGEN SUPPLY SYSTEMS GENERAL MANAGER'S RECOMMENDATION Authorize the General Manager to approve Amendment No. 7 to extend the agreement with Air Products and Chemicals, Inc., for Private Operation and Maintenance of Oxygen Generation System at Plant No. 2, Purchase Order 43063-OB for an additional five (5) month period beginning retroactively August 1, 2012, through December 31, 2012, at no additional cost to the District. SUMMARY Air Products and Chemicals, Inc. (APCI) is currently upgrading OCSD's liquid oxygen storage and delivery systems under the existing agreement for the Operation and Maintenance of Oxygen Generation System. The upgrade involves installation of a new oxygen supply system utilizing delivered liquid oxygen. This new system is in place and since May 19, 2012, delivered liquid oxygen is being used instead of the oxygen generated from the Cryogenic Oxygen Generation Systems for Plant No. 2's secondary treatment process. There are some elements of the upgrades, including the painting of the liquid oxygen storage tank and installation of a cathodic protection system that remain to be completed. The extension of the agreement would allow for the completion of these tasks and the project closeout. PRIOR COMMITTEE/BOARD ACTIONS April 2012 A. Authorize the General Manager to negotiate and subsequently approve Amendment No. 6 to extend the agreement with Air Products and Chemicals, Inc., for Private Operation and Maintenance of Oxygen Generation System at Plant No. 2, Purchase Order 43063-OB for an additional three (3) month period beginning May 1, 2012, through July 31, 2012, at the current monthly rate of $27,411.76; and Page 1 of 3 B. Amend the December 21, 2011 Board action (Item No. 13) and authorize the General Manager to competitively bid and subsequently award a contract for liquid oxygen, Specification C-2011-506BD, to the lowest responsible and responsive bidder, for a one-year period, from the date of the Notice to Proceed (thereby rescinding original contract term dates), for a total annual amount not to exceed $750,000. December 2011 — Authorize the General Manager to competitively bid and subsequently award a contract for liquid oxygen, Specification C-2011-506BD, to the lowest responsible and responsive bidder, for a one-year period, March 1, 2012 through February 28, 2013, for a total annual amount not to exceed $750,000. July 2011 — Authorize the General Manager to negotiate and subsequently approve Amendment No. 5 to the Agreement with Air Products and Chemicals, Inc., for Private Operation and Maintenance of Oxygen Generation System at Plant No. 2, Purchase Order No. 43063-OB to include the following: A. Extend the agreement with Air Products and Chemicals, Inc. for an additional three (3) month period beginning February 2, 2012, through April 30, 2012, at the current monthly rate of $27,411.76, and, B. Authorization for Air Products to refurbish the liquid oxygen storage and delivery system, for a total amount not to exceed $1 ,300,000; and, C. Approve a contingency of $260,000 (20%) for the liquid oxygen refurbishment. January 2010 — Amend the May 20, 2009 Board Minutes, Item No. 10, approving Amendment No. 4 to the Agreement for Private Operation and Maintenance of Oxygen Generation System at Plant No. 2 with Air Products and Chemicals, Inc., (P.O. 43063- OB), extending the contract for a two-year period beginning February 2, 2010 to February 1, 2012, for an annual amount not to exceed $328,941.12. May 2009 — Approve Amendment No. 4 to extend the contract with Air Products for a two-year period beginning February 2, 2010. June 2004 — Approve Amendment No. 3 to extend the contract with Air Products for a five-year period beginning February 2, 2005 and authorize a sole source rehabilitation of the spare oxygen generation unit by Air Products for an amount not to exceed $401 ,000. June 1997 — Approve Amendment No. 2 to the Agreement for Private Operation and Maintenance of Oxygen Generation System at Plant No. 2. This amendment reduced the operating expenses by $215,000 annually. August 1989 — Board Resolution No. 89-108. This Board action approved the original contract. Page 2 of 3 ADDITIONAL INFORMATION Staff's intent was to have these project elements completed; unfortunately, a far more detailed analysis was needed on the coating and cathodic protection project elements than originally anticipated. These analyses have been completed and the work is ready to proceed. CEQA N/A BUDGET/DELEGATION OF AUTHORITY COMPLIANCE N/A DH:SSB:ysh Page 3of3 WOODRUFF,SPRADUN&SMART 555 ANTON BOULEVARD, SUITE 1200 COSTA MESA, CA 92626-7670 (714)558-7000 MEMORANDUM TO: Hon. Members of the Board of Directors Orange County Sanitation District FROM: Bradley R. Hogin DATE: August 15, 2012 RE: City of Brea v. State of California—OCSD as Real Party in Interest Sacramento County Superior Court—Case No. 34-2012-8000-1204 GENERAL COUNSEL'S RECOMMENDATION Authorize the General Counsel to appear and represent the interest of the Orange County Sanitation District in the matter of City of Brea v. State of California, Sacramento County Superior Court Case No. 34-2012-8000-1204. SUMMARY On June 27, 2012, the California Legislature adopted, and the Governor signed, Assembly Bill 1484, the redevelopment trailer bill, which makes several substantive and technical amendments to ABx1 26, the bill enacted in late June 2011 that directed the dissolution of California redevelopment agencies. These new provisions permit the State to retroactively reallocate tax increments distributed prior to February 1, 2012 and property tax revenues. Assembly Bill 1484 requires the County Auditor-Controller to calculate "true-up" payments, which are residual payments that would have been due to taxing entities by successor agencies of unneeded funds. On July 16, 2012, the City of Brea and Successor Agency to the Brea Redevelopment Agency (collectively, 'Brea") filed a lawsuit in Sacramento County Superior Court (i) seeking a writ of mandate compelling the State and Orange County Auditor-Controller not to enforce certain provisions of Assembly Bill 1484, and (ii) seeking an injunction to restrain Respondents from enforcing certain provisions of Assembly Bill 1484. On July 27, 2012, Brea served the Orange County Sanitation District with an Amended Petition for Writ of Mandate. The Sanitation District was named as one of the Real Parties in Interest because the Sanitation District is an "affected taxing agency" as defined under Health and Safety Code section 33353.2, is a "taxing entity" under Health and Safety Code section 34171(k), and is entitled to receive pass-through payments and/or distribution of taxes pursuant to Assembly Bill 1484. 872679.1 STEERING COMMITTEE Meeting Date To Bd.of Dir. 08/22/12 08/22/12 AGENDA REPORT Item Number Item Number 2 6 Orange County Sanitation District FROM: James D. Ruth, General Manager Originator: Jim Herberg, Assistant General Manager SUBJECT: EnerTech Proposal GENERAL MANAGER'S RECOMMENDATION Decline Proposal from EnerTech to Enter into a New Agreement for Management of Biosolids. SUMMARY At the regular June meeting, the Board took action to declare EnerTech in default of the 2006 Agreement based on unsuccessful completion of the Interim Technical Plan by the deadline of June 11, 2012. The Board also directed staff to cease all shipments of biosolids to EnerTech's Rialto facility pursuant to the 2006 Agreement. The Board further authorized staff to negotiate terms of a new agreement providing for continued deliveries to EnerTech at a reduced price. The new agreement was to include language confirming that neither a new agreement, nor the Orange County Sanitation District's (Sanitation District) decision to continue to provide biosolids, would in any way revive the Sanitation District's obligations under the old agreement. EnerTech met with staff and made a two-pronged proposal for a short-term and long- term agreement. The short-term agreement would be for a reduced rate while EnerTech continues to demonstrate and commission the facility. The long-term agreement would start as soon as the facility is fully commissioned, but no later than two years from the start of the short-term agreement. While staff would like to see the EnerTech facility successfully commissioned, the progress to date suggests that EnerTech is not able to meet the long-term obligations established in the previously terminated contract. Also, the proposed reduced rate is still well above the Sanitation District's lowest cost option, land application. Staff does not recommend accepting EnerTech's proposal and does not recommend further consideration of resuming shipments of biosolids to EnerTech's Rialto facility at this time. Staff is not confident that the facility will reliably operate at 600 tons per day of throughput, and the proposed fee is higher than other options currently available to the Sanitation District. Staff recommends revisiting the Rialto facility if EnerTech can successfully commission the facility in the future. Page 1 of 2 PRIOR COMMITTEE/BOARD ACTIONS June 2012 — Declared EnerTech in default of 2006 Agreement and directed staff to cease shipments to the Rialto facility and provide notice to EnerTech. Directed staff to negotiate a new agreement providing for continued shipments without reviving the Sanitation District's obligations under the old agreement. March 2012 - Adopted Amendment No. 3 with EnerTech which provides the following changes to the existing contract: (1) Extends the time for completion of the Interim Technical Plan from March 13, 2012 to June 11 , 2012 (90 days); (2) Continues the reduced management fee and accumulation of rebates during the time of extension; and (3) Provides a mechanism to cease delivery of biosolids to EnerTech immediately after June 11, 2012 if EnerTech does not successfully complete commissioning of the facility, as defined. February 2011 - Adopted Amendment No. 2 to Agreement with EnerTech, implementing an Interim Technical Plan, which included performance measures to be completed no later than March 13, 2012. In addition, Amendment No. 2 includes: (1) a reduced fee provision for diverted biosolids to alterative sties during the period of February 16, 2011 to March 13, 2013; (2) a partial reimbursement provision of past management fees for diverted biosolids in the amount of $1,047,501 .55; and (3) a partial rebate provision of future management fees for diverted biosolids. November 2006 - Adopted Amendment No. 1 to Agreement with EnerTech, increasing the amount of biosolids from 200 tons to 225 tons, and revising the contract period to 25 years with one (1) five-year option, and to increase cost from $69.40 to $72.40 per ton (plus other variable costs). July 2005 - Adopted 10-year Agreement with EnerTech Environmental California, LLC with four (4) five-year options at an initial cost of $69.40 per ton of biosolids managed. ADDITIONAL INFORMATION N/A CEQA N/A BUDGET / DELEGATION OF AUTHORITY COMPLIANCE The recommended action does not authorize additional budget expenditures. JH:gc Page 2 of 2 OPERATIONS COMMITTEE Meeting Date To Bd.of Dir. 08/01/12 08/22/12 AGENDA REPORT Item Number Item Number 2 8 Orange County Sanitation District FROM: James D. Ruth, General Manager Originator: Jim Herberg, Assistant General Manager CIP Project Manager: Pamela Koester SUBJECT: BALBOA TRUNK SEWER REHABILITATION, PROJECT NO. 5-47 GENERAL MANAGER'S RECOMMENDATION Approve a contingency increase of $79,540 (10%) to the Professional Design Services Agreement with AECOM Technical Services for the Balboa Trunk Sewer Rehabilitation, Project No. 5-47, for a total contingency of $159,280 (20%). SUMMARY This project will rehabilitate 11 ,931 feet of 15 to 24-inch diameter sewers and 40 manholes along Newport and Balboa Boulevards on the Balboa Peninsula in Newport Beach. AECOM Technical Services is providing engineering services for this project. As the Preliminary Design Report (PDR) was being completed in August 2010, Newport Beach requested the Orange County Sanitation District (Sanitation District) analyze several options to replace some of the sewers on the Balboa Penisula instead of rehabilitating them. Based on additional investigations conducted by the Sanitation District staff, it has been determined that replacing the existing sewer would not be necessary. The Sanitation District is now in a position to move forward with the original project. Due to the schedule delay, AECOM Technical Services needs to verify project assumptions, schedule, and construction costs in order to move forward with final design. It is estimated that the fees required to restart the project and revise the design to meet current design standards will exceed the available contingency. This additional contingency approval of $79,640 is being requested to cover the remaining design effort. PRIOR COMMITTEE/BOARD ACTIONS December 2008 — Approved a Professional Design Services Agreement with AECOM Technical Services to provide professional design services for the Balboa Trunk Sewer Rehabiltiation, Project No. 5-47, for an amount not to exceed $796,404; and approved a contingency of $79,640 (10%). Page 1 of 2 ADDITIONAL INFORMATION The purpose of this project is to rehabilitate 11,931 feet of the Balboa Trunk Sewer and 40 manholes along Newport and Balboa Boulevards on the Balboa Peninsula in Newport Beach. The preliminary design of this project started in March of 2009. The major tasks asociated with the PDR included preparation of updated sewer plans based on a new survey; hydraulic analyses of the trunk sewer to determine if surcharging conditions exist in the trunk sewer that need to be addressed; condition assessment of existing sewers and manholes; identification of suitable rehabitation techniques; and preparation of construction costs and schedule. A draft PDR was completed in August of 2010. As the PDR was being completed, the City of Newport Beach requested the Sanitation District consider replacing a specific segment of the Balboa Trunk Sewer due to potential hydraulic issues in the local sewers that may be caused by the hydraulics of the Balboa Trunk Sewer. The Sanitation District conducted a more in-depth analysis of the sewer hydraulics and Newport Beach conducted flow monitoring on specific local sewers that discharge into the Balboa Trunk Sewer. After reviewing the new data, it was determined that the Balboa Trunk Sewer is not responsible for local sewer hydraulic issues. The project is now ready to move forward as originally planned. Since considerable time has passed since the PDR was completed, verification of existing conditions is warranted. In addition, the plans and specifications need to be brought up to current requirements including updated cost information, revised sewer bypass requirements and design, revised stormwater specifications as well as a review of specifications that may have been revised since the PDR was prepared. Changes will also need to be made to the traffic control plans and construction phasing based on current conditions. CEQA This project was included in the 2007 Collections Projects, Environmental Impact Report (EIR). A Notice of Exemption was filed on June 8, 2010. BUDGET/DELEGATION OF AUTHORITY COMPLIANCE This request complies with authority levels of the Sanitation District's Delegation of Authority. This item is budgeted and the budget is sufficient for the recommended action (FY2012-13, Section 8, Page 26). Date of Approval Contract Amount Contingency 12/3/08 $796,404 $ 79,640 (10%) 8/22/12 $ 79,640 (10%) $159,280 (20%) JH:PK:dm:gc Page 2 of 2 OPERATIONS COMMITTEE Meeting Date To Bd. of Dir. 08/01/12 08/22/12 AGENDA REPORT Item Number Item Number 3 9 Orange County Sanitation District FROM: James D. Ruth, General Manager Originator: Jim Herberg, Assistant General Manager Project Manager: Martin Dix SUBJECT: INTERPLANT GAS LINE REHABILITATION, PROJECT NO. J-106 GENERAL MANAGER'S RECOMMENDATION Approve a contingency increase of $266,248 (13%) to the construction contract with J. Fletcher Creamer & Son, Inc., for Interplant Gas Line Rehabilitation, Project No. J-106, for a total contingency of $409,612 (20%) SUMMARY This project rehabilitates the Interplant Gas Line (pipeline) by installing a new high density polyethylene pipe (HDPE) within the pipeline. The pipeline was built to transport digester gas from Plant No. 1 to the cogeneration equipment located at Plant No. 2 where it would be used to generate electricity to operate portions of the Plant No. 2 facility. This project provides a cost savings by maximizing the use of available digester gas for energy production, and reduces air quality emissions by limiting the flaring of excess digester gas. Since the pipeline transports digester gas, the pipeline falls under the jurisdiction of the US Department of Transportation (DOT) which develops and enforces gas pipeline regulations. At the beginning of construction, the Orange County Sanitation District (Sanitation District) staff discovered that the specified HDPE material was based on an industry standard, but not the standard used by the DOT. The DOT regulations specify a thicker pipeline wall than the contract specified pipeline. This change in requirement translates to a higher pipeline material cost. A budget increase is not needed to cover the additional contingency request. At the April 2012 Board meeting, the construction contract for the Interplant Gas Line Rehabilitation Project was awarded to J. Fletcher Creamer & Son, Inc. for $2,048,060, which is $991 ,940 less than the budgeted construction amount. To cover the costs of the thicker pipeline material to meet DOT requirements, staff is requesting an additional contingency of $266,248 (13%), for a total project contingency of $409,612 (20%). Page 1 of 2 PRIOR COMMITTEE/BOARD ACTIONS April, 2012 — Approved Plans and Specifications for Interplant Gas Line Rehabilitation, Project No. J-106, on file at the office of the Clerk of the Board; approved Addendum No. 1 to the plans and specifications; received and filed bid tabulation and recommendation; awarded a construction contract to J. Fletcher Creamer & Son, Inc. for Interplant Gas Line Rehabilitation, Project No. J-106, for a total amount not to exceed $2,048,060; and, approved a contingency of $143,364 (7%). ADDITIONAL INFORMATION The Design Consultant used a pipeline standard that is not allowed by the DOT. During design, the focus of the rehabilitation project was to ensure the rehabilitation pipeline meet operating pressure requirements governed by a factor of safety. However, the DOT pipeline standard derates HDPE material for gas use; therefore, a thicker HDPE material is needed to achieve the same operating pressure. The project specifications and particularly the pipeline specification section was reviewed by the design team and the issue relating to the DOT requirements for the pipeline material was an oversight that was not recognized until the pipeline construction material submittal was received from the Contractor. CEQA Notice of Exemption was filed on January 19, 2006. BUDGET/DELEGATION OF AUTHORITY COMPLIANCE This request for increase in the project contingency complies with authority levels of the Sanitation District's Delegation of Authority. This item has been budgeted and the budget is sufficient for the recommended action (FY2012-13, Section 8, Page 66). Date of Approval Contract Amount Contingency 04/25/12 $2,048,060 $143,364 (7%) 08/22/12 $266,248 (13%) Total Contingency $409,612 (20%) JH:MD:dm:gc Page 2 of 2 OPERATIONS COMMITTEE Meeting Date To Bd. of Dir. 08/01/12 08/22/12 AGENDA REPORT Item Number Item Number 4 10 Orange County Sanitation District FROM: James D. Ruth, General Manager Originator: Jim Herberg, Assistant General Manager CIP Project Manager: Dean Fisher SUBJECT: CENTRAL GENERATION AUTOMATION, PROJECT NO. J-79-1 GENERAL MANAGER'S RECOMMENDATION Approve a budget increase of $97,000 for Central Generation Automation, Project J-79-1, for a total budget amount of $23,443,000. SUMMARY This project installs new control systems for the Central Generation Systems (CGS) at Reclamation Plant No. 1 and Treatment Plant No. 2. The original control systems were installed 20 years ago and are no longer supported by the original manufacturer. The construction was substantially completed in November 2011. The J-79-1 budget also funded Project No. J-79-1A; the installation of Continuous Emissions Monitoring Systems for each engine in the CGS system, in accordance with the Southern California Air Quality Management Board regulations. The construction was substantially completed in September 2009. The project is being closed out. Additional budget is being requested to cover staff costs to complete the record documentation and finalize the project. PRIOR COMMITTEE/BOARD ACTIONS In January 2009, the Board approved a contract with Sachs Electric Company for an amount of $9,252,315 to replace the control systems for the Central Generation Systems. In September 2008, the Board approved a contract with the Morrow Meadows Corporation for an amount of $3,958,700 to install CEMS units on each CGS engine. ADDITIONAL INFORMATION N/A CEQA N/A Page 1 of 2 BUDGET/DELEGATION OF AUTHORITY COMPLIANCE This request complies with authority levels of the Sanitation District's Delegation of Authority. This item is budgeted, but the budget is insufficient for the recommended action (FY 2012-13, Section 8, Page 69). The requested budget increase will be funded from offsets within the CIP Budget. Date of Approval Contract Amount Contingency N/A N/A N/A JH:DF:dm:gc Page 2 of 2 OPERATIONS COMMITTEE Meeting Date To Bd. of Dir. 08/01/12 08/22/12 AGENDA REPORT Item Number Item Number 6 11 Orange County Sanitation District FROM: James D. Ruth, General Manager Originator: Jim Herberg, Assistant General Manager Env. Compliance: Jim Colston, Env. Compliance Manager SUBJECT: BIOSOLIDS MANAGEMENT CONTRACT AWARD RECOMMENDATION — TULE RANCH GENERAL MANAGER'S RECOMMENDATION A. Receive and file Statement of Complaint for the Recommendation of Biosolids Management Contract Award letter dated July 12, 2012 from Terra Renewal West LLC protesting award to Tule Ranch; B. Receive and file letter dated July 23, 2012 to Terra Renewal West LLC responding to the Statement of Complaint; and, C. Approve a contract with Tule Ranch to manage the Orange County Sanitation District's biosolids from Reclamation Plant No. 1 and Treatment Plant No. 2 for land application and/or landfill disposal (Specification No. S-2011-51313D), for the period commencing on January 1, 2013 through December 31, 2017, with one five-year renewal option, for the unit price of $54.50 per ton for land application, for a total annual amount not to exceed $19,000,000. SUMMARY The Orange County Sanitation District (OCSD) currently has two biosolids management contractors providing land application and composting. The land application contract is scheduled to expire on December 31 , 2012. OCSD released a Request for Proposals (RFP) on January 31 , 2012 seeking proposals from qualified professional biosolids management contractors to provide land application after December 31 , 2012. A total of six proposals were received on April 17, 2012. The proposals were evaluated and ranked based on pre-defined scoring for technical and cost considerations in accordance with OCSD's Resolution No. 07-04, Section 5.07. The firm with the highest ranking by the staff evaluation panel is Tule Ranch, the current land application contractor. Contractor selection was on the agenda for consideration at the June 27, 2012 regular Board Meeting. The item was continued to the August 1, 2012 Operations Committee meeting. Questions raised by the Board of Directors at the June 27 meeting are Page 1 of 12 addressed in the "Additional Information" section of this report. Specifically, the RFP process, review criteria, and evaluation panel are explained in detail. Terra Renewal West LLC (Terra Renewal), one of the proposers, sent a Statement of Complaint letter dated July 12, 2012 regarding the award recommendation. OCSD reviewed and responded to Terra Renewal's Statement of Complaint and found that the complaint does not merit a change to the award recommendation. The proposed contract with Tule Ranch for normal operations would cover approximately one-third to one-half of OCSD's daily production at the rate of $54.50 per ton for land application. This price is a reduction of $1 .00 per ton from Tule's current price of $55.50 per ton. This price is $2.56 per mile for a 25-ton load traveling 530 miles round trip to Yuma, AZ. This price is below the median of $2.66 per mile for 12 Southern California wastewater agencies surveyed in 2012. The proposed contract also provides for a failsafe option for landfilling all of OCSD's biosolids at the rate of $69.00 per ton if unusual circumstances such as severe weather or other emergency conditions require OCSD to divert all of our biosolids to a landfill until conditions return to normal. PRIOR COMMITTEE/BOARD ACTIONS June 27, 2012 — Continued approval of a contract to manage OCSD's biosolids to August 1, 2012 Operations Committee. ADDITIONAL INFORMATION OCSD has an existing contract with Tule Ranch for the management of biosolids. The contract expires at the end of this year. The current contract rate is $55.25 per ton for land application. Tule Ranch has performed exceptionally well over the life of the contract. In January 2012, OCSD issued a Request for Proposals to re-contract the land application biosolids tonnage. The RFP set forth the process for considering the proposals. The RFP process awards the contract based on the best value to OCSD rather than just the lowest price. The RFP explained that best value would be determined by an evaluation committee of staff experts who would rank the proposals based on the following criteria: Criteria Max Evaluation Criteria Points (Weight) 1. Overall Qualification and Experience of Firm — Include 100 pts. experience working with public agencies, length of experience in (10%) land applying and landfilling biosolids and stability of firm, experience and technical competence of subcontractors, if any, Page 2 of 12 and knowledge of the laws and regulations. 2. Staffing Organization — Include qualifications of staff, particularly 100 pts. key personnel and Project Manager/Project Lead/Foreman that will (10%) directly work with OCSD staff. 3. Financial Capabilities — Include Net Worth Capital of the last 100 pts. three years (Balance Sheets) and if Proponent is now the debtor in (10%) a bankruptcy case. 4. Work Plan — Include project approach, activities, schedule, project 400 pts. siting, management system preparedness and conformance, (40%) contractor diversification, and compliance. 5. Cost and Price 300 pts. (30%) Total 1000 pts. (100%) In April 2012, OCSD received proposals from six firms in response to the RFP. The evaluation committee determined that five of the six firms met the minimum acceptable qualifications set forth in the RFP: (1) Avragro Systems, (2) Nursery Products, (3) McCarthy Farms, (4) Terra Renewal, and (5) Tule Ranch. The evaluation committee then ranked the five proposals according to the criteria set forth in the RFP. After considering the first four criteria — everything except price — the evaluation committee gave Tule Ranch the highest score of 670 points. McCarthy Farms received the second highest score of 630 points. The third-ranked firm, Terra Renewal, received a substantially lower score of 460 points. Because the scores received by Tule Ranch and McCarthy Farms were very close, staff initiated the "Best and Final Offer" process as described in the RFP. Pursuant to this process, OCSD staff invited Tule Ranch and McCarthy Farms to meet with OCSD staff on May 23rd to obtain clarification and additional information, and to discuss specified issues. During the meeting with McCarthy Farms, OCSD staff learned that McCarthy Farms had not finished testing its proposed biosolids management process. Thus, McCarthy Farms could not provide a firm cost proposal. McCarthy Farms elected at that time to withdraw from the RFP process. During the meeting with Tule Ranch, OCSD staff obtained additional information and negotiated the appropriate formula for calculating the fuel surcharge fee. This fee will escalate based on the price of diesel fuel. After conclusion of the RFP process, OCSD staff recommended that the Board approve a contract with Tule Ranch on the following basic terms: Page 3 of 12 ( Term: January 1, 2013 through December 31, 2017, with one five-year renewal option; ( Price: o $54.50 per ton for land application in Arizona; o $69.00 per ton for landfill disposal in Arizona (to be used in emergencies only); o $6.00 per ton (hauling only) for Orange County landfill; o A fuel surcharge fee with an escalator based on the actual price of diesel fuel; and o A total annual amount not to exceed $19 million. The proposed contract would not obligate OCSD to provide any minimum amount of biosolids to Tule Ranch. OCSD staff anticipates managing roughly 250 tons per day under the contract. This represents about one-third of OCSD's total production of biosolids. At the rate of $54.50 per ton, managing 250 tons per day is projected to cost $13,625 a day, or $4,973,125 per year. The annual "not to exceed" amount of $19 million represents the cost of managing OCSD's total production of 750 tons per day in the unlikely event that OCSD suddenly has no other management options (failsafe back-up capacity required in RFP). At the Board meeting of June 27t", Terra Renewal submitted a letter objecting to the proposed award to Tule Ranch based on the fact that Terra Renewal offered a lower price. After additional review, staff continues to recommend awarding the contract to Tule Ranch rather than Terra Renewal, despite the fact that Terra Renewal offers a lower price, for the following key reasons: 1. This award is not based on the low bid. The RFP appropriately stated that the contract would be awarded based on best value to OCSD rather than the lowest price. Price was one factor, but only one factor, to be considered in the evaluation. Biosolids management is subject to very close scrutiny by local governments, the press, and the public. In the past, local governments have banned the land application of biosolids based on perceived risks to human health and the environment. It is very important that OCSD's contractors adhere to the highest standards in managing OCSD's biosolids. Thus, pursuant to the RFP, staff recommends awarding the contract to the most qualified firm — Tule Ranch — even though that firm does not offer the lowest price. Page 4 of 12 2. Tule Ranch is the most qualified by a substantial margin. The evaluation committee ranked Tule Ranch substantially higher than Terra Renewal — the committee gave Tule Ranch 670 points, and gave Terra Renewal only 460 points. Tule Ranch scored significantly higher across the board in all evaluation categories. 3. Terra Renewal substantially overstated the cost difference. Terra Renewal claims that the Terra Renewal price would save OCSD $6 million over five years as compared with the Tule Ranch price. This is not correct. OCSD anticipates sending roughly 250 tons per day under the proposed contract. Based on 250 tons per day, Terra Renewal's price would save about $2.1 million over the 5-year life of the contract as compared with Tule Ranch. To put this figure in perspective, it is 2.1% of the total amount that OCSD has budgeted for biosolids management during the five-year period — about $100 million. 4. OCSD staff negotiated with Tule Ranch, and the price is fair and reasonable. OCSD's experts concluded that the Tule Ranch price is fair and reasonable based on the market for biosolids management. Moreover, OCSD staff negotiated the terms of the agreement with Tule Ranch, obtaining a $1 per ton reduction in the price and a favorable calculation for the fuel surcharge fee. 5. The process was fair. The RFP process was fair to all proposers. The evaluation panel consisted of impartial experts from various disciplines who applied objective criteria. All of the criteria to be applied were set forth in the RFP. As an added measure, OCSD retained the services of an outside consultant who specializes in public procurements to ensure that the process was open and fair. QUESTIONS PRESENTED Why is the Award Based on Best Value Rather than the Lowest Price? Under state law and OCSD's Purchasing Resolution 07-04, OCSD generally awards contracts based on either (1) competitive bids, or (2) competitive proposals. Under a competitive bid process, OCSD awards the contract to the lowest responsive, responsible bidder. The contract is not awarded to the "most qualified" firm. Rather, the contract is awarded to the lowest bidder that submits a responsive bid and is deemed to be responsible. The competitive bid approach is generally appropriate for the procurement of goods and services that are considered to be interchangeable. OCSD follows a competitive bid process, for example, for the award of public works construction contracts and most contracts for the purchase of goods and services. Under a competitive proposal process, in contrast, OCSD awards the contract to the "most qualified" proposer based on a fair and reasonable price. A competitive proposal process is generally appropriate for the procurement of goods and services that are not Page 5 of 12 considered interchangeable. Under a competitive proposal process, OCSD awards the contract based on the "best value" to OCSD rather than the lowest price. Price is one factor, but only one factor, that OCSD considers when evaluating competitive proposals. OCSD follows a competitive proposal process, for example, for professional design service contracts and for most other types of professional service contracts. OCSD used a competitive proposal process for the contract here because biosolids management services are not interchangeable. Moreover, OCSD has a great deal at stake in ensuring that its biosolids management contractors are the most qualified available, assuming that the price is fair and reasonable. Since the late 1990s, local governments, the press, regulators, and the public served have expressed a variety of concerns about the land application of biosolids in their communities. These concerns include perceived threats to human health and the environment and complaints about traffic, odor, and noise. In some cases, a combination of politics, media attention, and public perception has led to outright bans on the land application of biosolids. Of course, the concerns about biosolids management in general, and land application in particular, are unjustified. Federal, state, and local governments have adopted regulations designed to eliminate any risks posed by the land application of biosolids. Moreover, qualified firms have for many years safely managed biosolids throughout California and Arizona without any threat to the community or the environment. However, because biosolids management is under close and constant scrutiny, it is very important that OCSD set and follow the very highest standards in biosolids management. To that end, OCSD became the first biosolids program in the nation to be certified by the National Biosolids Partnership. This certification is granted when an agency demonstrates (via a third-party audit) an effective management system that complies with a best management standard (similar to ISO 14001) and continuous improvement among many other criteria. In order to implement and maintain these high standards, it is very important that OCSD select the most qualified firm that is willing to perform the services at a fair and reasonable price. That is why OCSD elected to pursue a competitive proposal process rather than a competitive bid process. What Scores Did the Evaluation Committee Give to Each Proposal? OCSD staff appointed an evaluation committee consisting of five OCSD staff members. The committee evaluated the five proposals according to the first four criteria set forth in the RFP (all criteria except price). Criteria Max Evaluation Criteria Points (Weight) Page 6 of 12 1. Overall Qualification and Experience of Firm — Include 100 pts. experience working with public agencies, length of experience in (10%) land applying and landfilling biosolids and stability of firm, experience and technical competence of subcontractors, if any, and knowledge of the laws and regulations. 2. Staffing Organization — Include qualifications of staff, particularly 100 pts. key personnel and Project Manager/Project Lead/Foreman that will (10%) directly work with the District staff. 3. Financial Capabilities — Include Net Worth Capital of the last 100 pts. three years (Balance Sheets) and if Proponent is now the debtor in (10%) a bankruptcy case 4. Work Plan — Include project approach, activities, schedule, project 400 pts. siting, management system preparedness and conformance, (40%) contractor diversification, and compliance. The evaluation committee used a consensus-scoring method in order to foster open discussion among the panel members about relative strengths and weaknesses of each proposal. During each meeting, the Procurement Officer directed the panel's attention to each item in the specifications. The panel considered and discussed one proposal at a time, comparing the proposal against the specifications. The results of the consensus scoring are as follows: S-2011-513BD CONSENSUS Tule Terra SCORING Ranch McCarthy Renewal Avragro Nursery Possible Qualifications 100 100 70 40 20 100 Staffing 90 90 70 40 20 100 Financial Capabilities 80 80 40 0 20 100 Workplan 400 360 280 160 80 400 Total 670 630 460 240 140 700 The Tule Ranch proposal received the highest score based largely on the following facts. Tule Ranch: O Has the closest land application sites in Arizona. Other contractors may need to travel farther. O Established a truck-transfer yard in Yuma, Arizona to ensure that drivers comply with Department of Transportation requirements. O Has strong financials, based on both working capital and net worth. This allows Tule Ranch to make ongoing capital investments in trucks, equipment, field offices, maintenance yards, and land in order to ensure land application in Page 7 of 12 Arizona is sustainable in the long term. Strong financials also means that Tule Ranch has the ability to honor an indemnity in favor of OCSD. O Owns all of the trucks and land application equipment to be used under the contract — there are no owner-operator subcontractors. Thus, Tule Ranch has a centralized and documented preventive maintenance program, and OCSD can easily track training, hauling, regulatory compliance, data collection, and responses to emergencies. O Has direct control of all aspects of the operations (hauling, application to field, incorporation/disking into soil, planting, harvesting, crop yields). O Provided significant investment to meet OCSD's quality standards and oversight requirements as set forth in OCSD's certified biosolids program. O Established a local field office close to land application sites, so that it can maintain closer oversight and control of field operations and respond more quickly to any issues of concern. What is the Cost Difference between Tule Ranch and Terra Renewal? In their letter submitted at the June 27fh Board Meeting, Terra Renewal claimed that the cost difference between the Tule Ranch proposal and the Terra Renewal proposal is $6 million over the five-year life of the contract. This is incorrect. OCSD anticipates sending 250 tons per day to Tule Ranch under the proposed contract at a rate of $54.50 per ton. This amounts to a projected cost of about $13,625 per day or $4,973,125 per year. Terra Renewal's proposed rate is $49.88 per ton. Thus, Terra Renewal's proposal would cost $12,470 per day or $4,551,550 per year. The projected cost difference between the Tule Ranch proposal and the Terra Renewal proposal, then, is $421 ,575 per year, or $2,107,875 over the five-year life of the contract. To put this amount in perspective, the differential is 2.1% of the $100 million total amount that OCSD has budgeted for biosolids management over the next five years. The evaluation committee considered Tule Ranch's proposal to be the best value as described above. How Did Staff Take Price into Consideration? As set forth in the RFP, the evaluation panel could give each proposal up to 300 points based on cost. Pursuant to the RFP, cost proposals were submitted separately from the technical proposals, so that the evaluation committee could consider qualifications first and then price separately. After determining that Tule Ranch and McCarthy Farms were the most qualified vendors, the evaluation committee considered cost for those two firms only. The Page 8 of 12 following table presents the final scores taking into account cost for Tule Ranch and McCarthy Farms: S-2011- 513BD CONSENSUS McCarthy Tule Terra Avragro Nursery SCORING Farms Ranch Renewal Systems Farms Possible Qualifications 100 100 70 40 20 100 Staffing 90 90 70 40 20 100 Financial Capabilities 80 80 40 0 20 100 Workplan 360 400 280 160 80 400 Subtotal before Cost 630 670 460 240 140 700 Total Cost Points based on formula 300 253 300 TOTAL 930 923 460 240 140 1000 In the judgment of the evaluation panel, the prices proposed by both Tule Ranch and McCarthy Farms were fair and reasonable based on the current market for biosolids services. This conclusion was based on expert knowledge of the marketplace, including a survey of biosolids contracts performed by the Southern California Alliance of Publicly Owned Treatment Works (SCAP) in 2010 and updated by staff in 2012. According to the 2010 SCAP survey, the cost for land applying of biosolids ranged from $30.32 to $55.00 per wet ton. However, the costs do not take into account the distance that biosolids are hauled for a particular agency. When mileage is taken into account, using a full truck at 25 tons, the 2010 Cost Range per mile is $2.14-$7.61. OCSD staff contacted several Southern California wastewater agencies for their current 2012 rates - the cost ranged from $36.00 to $54.50 per wet ton, and the Cost per mile ranged from $2.11 to $3.29. The proposed contract with Tule Ranch would be at a cost of $54.50 per wet ton, or $2.56 per mile. Tule's price of $2.56 is below the 2012 median price of $2.66 per mile (see Attachment-5). Page 9 of 12 The panel did not assign a price ranking for Terra Renewal, Avragro Systems, or Nursery Farms because, as explained above, Tule Ranch and McCarthy Farms were deemed to be the most qualified by a substantial margin. However, even if Terra Renewal's proposal were given the maximum score of 300 for cost, Terra Renewal would still be ranked well below Tule Ranch — 760 points for Terra Renewal vs. 923 points for Tule Ranch. After the Best and Final Offer process was concluded, OCSD staff entered into final negotiations with Tule Ranch regarding price. As a result of these negotiations, Tule Ranch agreed to lower its price by $1 per ton, from $55.50 to $54.50 for land application, and from $70 to $69 per ton for landfill disposal. The savings of $1 per ton amounts to $91,250 per year, or $456,250 over the five-year life of the contract. In exchange for the price reduction, OCSD staff agreed to remove the performance bond requirement. A performance bond covers the cost of a bond company to perform the work if Tule Ranch does not perform (or the expense involved in issuing another RFP). Given Tule Ranch's financial strength, and 18-year history of working with OCSD, it seems very unlikely that Tule Ranch would be unable to perform. Moreover, OCSD maintains multiple contracts for biosolids management so as not to rely on any one option. Was the Process Fair? Staff strongly believes that the process followed in evaluating the proposals and recommending award was extremely fair to all of the proposers. OCSD utilizes a standard RFP format, thus staff followed the process as set forth in the RFP. The evaluation committee was composed of experts from across the agency who understand the procurement process and the needs of our biosolids management program. The committee had five voting members: a project manager, a regulatory compliance expert, a finance expert, a planning expert, and an operations expert. The committee also included a non-voting risk management and safety expert. OCSD's Procurement Officer/Sr. Buyer managed the procurement process and Michael Asner, an external consultant "Fairness Officer," oversaw the process to ensure fairness within the process, but neither were voting members. Each evaluation committee member was responsible for reviewing and evaluating each of the proposals, compiling lists of questions/issues for submission to the suppliers, attending Supplier presentations, and delivering input to the process of scoring and selection. [See attached Biosolids Management Program RFP Evaluation Guide S-2011-513BD, Feb. 2, 2012] Each evaluation committee member was required to determine if they had any financial or personal conflicts prior to serving on the panel. Each evaluation committee member then executed a document certifying that they did not have any conflicts that prevented them from serving on the panel. A fairness officer is an independent external consultant with expertise in public procurement. A fairness officer helps to ensure that the process for awarding contracts is fair, open, and transparent. Page 10 of 12 Because of the complexity, cost and historic contentiousness in securing a biosolids management contractor, OCSD hired Michael Asner to serve as fairness officer. Mr. Asner is a recognized national expert in procurement and has experience with high risk RFPs. For the last 20 years, Mr. Asner has provided leadership in ensuring that public procurement is based on "fair, open, and transparent" competition. He has acted as a Fairness Officer, developed training programs, and written articles and guides related to this topic. He has been qualified as an expert witness in public procurement by the Federal Court in Phoenix, Arizona. In addition, Michael Asner participated as the "Fairness Officer" for OCSD's previous Biosolids RFP in 2003. Michael Asner's website, www.rfpmentor.com, contains a link to his resume, http://www.rfpmentor.com/resume-michael-asner. It also contains a section, http://www.rfpmentor.com/products, describing his current reference publications, webinars and training CDs, and is used by more than 5000 public agencies. One of his products, A Guide to Public Procurement for Elected Officials and Public Sector Managers, is in wide distribution and is available in both printed and electronic form. This Guide deals with 26 fundamental questions such as "Are bids and proposals different?" and "What is the legal framework for procurement?" Mr. Asner advised and directed the procurement and evaluation team during the RFP process to ensure that every step could survive public and legal scrutiny. He was involved at every stage of this RFP process, from RFP development through the completion of the evaluation process. At the conclusion of his service, Mr. Asner provided OCSD management a written determination of his findings of the RFP process, concluding that the process he observed was done in a fair, open, and transparent manner and has identified this RFP evaluation as exemplary. (See attached report from Michael Asner Consulting dated June 6, 2012) CEQA There is no change to the current operation or management of biosolids proposed by the awarding of this contract. BUDGET/DELEGATION OF AUTHORITY COMPLIANCE This request complies with authority levels of the Sanitation District's Delegation of Authority. This item has been budgeted. (Line item: Section 5, Page 6). Project contingency funds (will or will not) be used for this (type of document, i.e. amendment). Date of Approval Contract Amount Contingency 08/22/12 $19,000,000 N/A ATTACHMENTS 1. Letter from Terra Renewal dated July 12, 2012 2. Letter to Terra Renewal dated July 23, 2012 3. Biosolids Management Program RFP Evaluation Guide Page 11 of 12 4. Report from Michael Asner Consulting dated June 6, 2012 5. Southern California Wastewater Agencies Cost Comparison Table 6. Letters from Terra Renewal dated August 1, 2012 7. Agreement may be viewed online at: http://www.ocsd.com/Modules/ShowDocument.aspx?documentid=13912 JH:JC:jb:gc Page 12 of 12 Terra Renewal West, LLC 12812 Valley View St, Suite 9 TERRA Garden Grove, California 92845 renewal July 12, 2012 Chris Yates Orange County Sanitation District, Purchasing Senior Buyer Re: Statement of Complaint for the Recommendation of Biosolids Management Contract Award This is Terra Renewal West, LLC's (Terra Renewal) statement of complaint regarding the Orange County Sanitation District (District) evaluation panel's recommendation to award a contract for the land application of the District's biosolids to Tule Ranch. We thank the District for providing us the opportunity to file this statement of complaint. Given the District and its Request for Proposal documents do not provide a formal protest process, despite District staff s comments otherwise at the June 27 Board of Director's meeting, we appreciate the District staff s development of a means for us to protest the recommendation to award a contract through this statement of complaint process. In addition to some ambiguity and contradictory information experienced during this process, this complaint is based on: a)the evaluation panel's failure to consider the cost of the proposals when evaluating the proposals, which does not comply with requirements stated in the Request for Proposals' (RFP) "Award of Proposal"provision; b) the inequitable evaluation process employed by District staff to compare the proposals, and; c)the District staff s recommendation to waive the selected proponent's requirement to provide a performance bond in violation the requirements of the RFP. According to District staff and their Fairness Consultant during our debriefing meeting, the District received five viable proposals and all five proponents were capable of executing the services required in the RFP. After completing the proposal evaluation process, the evaluation panel selected a proposal and recommended their selection be awarded a contract. In their evaluation process, the evaluation panel did not consider the pricing of the proposals when they made their selection, which District staff revealed during the debriefing meeting. Pricing is a crucial aspect of this proposal, and, after determining they received five (5)viable proposals, the evaluation panel subjectively decided to not consider pricing of any of the viable proposals except one. In the RFP's Section 3.3, "Award of Proposal", it states: "Award will be made to the Proponent offering the most advantageous proposal after consideration of all Evaluation Criteria set forth in Section 6." The RFP's Evaluation Criteria Section 6 lists five criteria that the proposals would be evaluated under. One of the five criteria is "Cost and Pricing", Section 6.5. The evaluation panel's decision to not consider pricing when evaluating the proposals does not comply with the required evaluation criteria set forth in the District's RFP, therefore failing to follow Section 3.3 of the RFP. Had the evaluation panel considered the pricing of the proposals as part of the evaluation process, we feel Terra Renewal would have received the highest point total of the proposals. Since Terra Renewal's proposed price was the lowest of the viable proposals by a substantial margin, Terra Renewal would have received 300 points in the pricing category. We don't know how the evaluation panel would have weighted the pricing had they evaluated pricing, but we can speculate how the scoring would have occurred. As an example, the panel could have scored each proposal using the price of the lowest priced proposal as the bench mark for the other proposals. Then, as a subjective scoring method we came up with, for each $175,000 per year higher a proponent's price is above the bench mark price, the panel would deduct 100 points from the 300 possible points in this category. Using these scoring criteria, the incumbent would have scored 60/300 to Terra Renewal's 300/300,resulting in Terra Renewal being the highest scoring proponent (see Table 1). Table 1. Terra Renewal's Example of Proposal Scoring When Considering Pricing Terra Renewal Tule Ranch Consensus Score after 460/700 670/700 Evaluation Phase Price Score using Terra's 300/300 60/300 subjective scoring TOTAL 760/1000 730/4 000 In this scenario, Terra Renewal would have submitted the highest scoring proposal. The $421,000 per year cost saving to the District should be weight heavily in the evaluation process, in our opinion, as should be the opinion of the District. Especially when the District says Terra Renewal is viable and Terra Renewal has been performing these services for the District for the last four years under a subcontract with EnerTech Environmental. A price differential of$421,000 per year higher than another viable proposal should be apparent and score very few points in this category. The evaluation panel's process to assign points in each evaluation category was subjective, and may be counter to the District's fiduciary duty to the District's ratepayers. Even though we feel our proposal score would have been highest when considering pricing, in a subjective proposal evaluation and scoring process, the District is not required to recommend the highest scoring proposal to the Board. One proposal may receive higher scores in a subjective evaluation process,but, if the District receives multiple viable proposals who can execute the services of this contract, the panel should have recommended the proposal that is most advantageous to the District. A viable proposal that saves the District$2,100,000 over five years is a transparent benefit to the Page 2 of 5 District. Nowhere in the RFP does it state that the District is obligated to recommend awarding a contract to the highest scoring proposal, as the District's Fairness Consultant stated at the debriefing meeting. The RFP does state the District will make an award "based on the best interest of OCSD after all factors have been evaluated", and pricing is one of the most crucial factors in this proposal process. The evaluation panel failed to act in the best interest of the District by disregarding the significant saving provided by a viable proponent. Terra Renewal's viable proposal to the District saves the District at least $2,100,000 over the first five year term of the contract. By only considering the price of one of the five viable proposals, the evaluation panel obligated the District to accept whatever the pricing was from that selected proposal, whether it was $2,000,000 or $5,000,000 higher than another viable proposal. The panel's decision to disregard pricing was not done in the best interests of the District, most likely a glaring oversight by staff and the "Fairness Consultant". In today's tough economic climate, many cities and municipalities are dealing with financial hardship and some are dealing with potential bankruptcy and bankruptcy. The evaluation staff s disregard of the prices submitted for these services on a five to ten year contract managing 90,000— 135,000 tons of biosolids per year is a disservice to the District's ratepayers. Another basis of our complaint is the District evaluation panel's inequitable evaluation of the proposals. Not only did the evaluation panel disregard pricing as part of their evaluation process, they also used different evaluation methods to score each proposal. At the debriefing meeting, District staff stated that after they deemed five proposals as viable. But, the panel decided to interview only two proponents regarding their proposals. District staff admitted this decision was subjective and they could have interviewed all five viable proponents. District staff stated that the interviewing process is a means for the evaluation panel to clarify questions they have of the interviewed proponent. Once the evaluation panel receives these clarifications, that proponent can receive higher evaluation scores then originally given before the interview was conducted. Since the panel did not interview all the proponents including Terra Renewal, the evaluation scores are based on what we believe to be unequal scoring methods. We feel our score would have been higher had the evaluation panel included us in the interview process. The interviewed proponents were given a significant advantage over the other proponents by being able to clarify any questions the panel may have had regarding their proposal. This is a clearly an inequitable evaluation process leading to unequal evaluations of the proposals. The third basis for our statement of complaint is the District's decision to waive the requirement for the staff recommended incumbent to provide a performance bond. In a competitive proposal process, all proponents must follow the requirements established in the RFP documents. Section 3.18 of District's RFP requires any awarded contractor shall provide a 100% faithful performance bond, as follows: Page 3 of 5 3.18. Sureties —Awarded Contractor shall, before entering upon the performance of this Agreement, furnish bores approved by OCSD's General Counsel it the amourt of one hundred pervert (.IN ) of total annual coiripersation estin•ateo to be paid to Contractor, to -Larantee the faithful perforn•arce of the work. This Contract shall not become effective until such bongs are suppliec. to and approve. by OCSD. Bores must be issued by a surety authorized by the State Irsurance Commissioner to do business in California arc must be maintained throughout the life of the project and during the warranty perioQ. This is straightforward. During the June 27 Board of Director's meeting, the District's Environmental Compliance Manager stated the following(this quote was taken from the District's recording of the Board meeting): "Tule (the incumbent) has the ability and has offered to have a performance bond for this contract. In discussions with our General Counsel's office, the decision was made in the contracting process not to include a performance bond with the standards with the biosolids contract because of the way we manage risk by having multiple contractors. So that if one fails, the others can pick it up. That is the way, in other words, there is some cost to the way we manage currently by having multiple contractors. So adding that bond on top of that cost just adds us an unnecessary cost. In other words, if Tule fails to perform the other contractors pick it up in the mean time and we go back out with another contract and we get a contract going forward." If a performance bond was not necessary for this contract, it should have been made clear during the RFP process. Additionally, allowing a company to avoid providing the required performance bond does not add a cost to the District, as the District's Environmental Compliance Manager claimed,because the proposal pricing was based on a contract that included the cost of providing a performance bond. Waiving this requirement appears to only benefit the company that is not going to provide a bond because there is a cost for bonding. And, providing a letter saying you can get a performance bond doesn't guarantee a company can provide that bond. The only way to know if a company can provide a performance bond is requiring the bond before entering into a contract, as the RFP states. If the company can't provide a bond at that time, their proposal should be deemed non- responsive. This waiving of a performance bond may provide a company an advantage over the other companies by establishing a separate set of requirements just for that company. Our reasons for filing this statement of complaint are based on the proposal evaluation and award process. We have omitted detailing our frustration regarding the District staffs Agenda Report submitted to the Board of Director that lacked transparency and the inaccurate comments made during the June 27 Board meeting from our statement since it is does not apply to the RFP process. Based on the requirements in the District's Request for Proposal document and District staff s statements, the award of proposal for Page 4 of 5 this contract did not consider all the viable proponents' pricing, as required, the evaluation process did not treat all viable proposals equally, and waiving the proposal requirement of providing a performance bond creates an appearance of District establishing different criteria for different proponents. The land application of biosolids is not a Professional Services Agreement, like consulting services, that may require the scrutiny of a proposal process. The District's decision to issue a RFP for these services adds a tremendous amount of subjectivity to the awarding process. Subjectivity adds personal opinion into what should be a bid process where the lowest responsive bidder that meets all of the District's qualifications is awarded a contract. The District staffs decision to award a contract to the proposal that had the highest score in a subjective evaluation process opens the door to disagreements over scoring criteria and the process. As it has been said, with subjective statements, disagreements can go on forever. Do to the compromised proposal evaluation and award process, we ask that District staff recommend awarding a contract to Terra Renewal, the lowest cost viable option to the District, or cancel this RFP and issue a Request for Bid for these services, where the District selects the lowest priced responsive bidder. Sincerely, Jeff Thurber General Manager Terra Renewal West, LLC Cc: Anne Marie Feery, OCSD Purchasing Supervisor Page 5 of 5 oJ �V SANIT,�TT� ORANGE COUNTY SANITATION DISTRICT It We protect public health and the environment by providing effective wastewater collection,treatment,and recycling. o ; fCT/NC THE ENv\PQ� July 23, 2012 Mr.Jeff Thurber General Manager Terra Renewal West, LLC Serving 12812 Valley View Street, Suite 9 Anaheim Garden Grove, CA 92845 Brea Buena Park RE: Statement of Complaint for the Recommendation of Biosolids Management Cypress Contract Award n Valley Fullerton The Orange County Sanitation District (OCSD) received the Statement of Complaint from en Grove Terra Renewal West, LLC (Terra Renewal) dated July 12, 2012 (Request for Proposal (RFP) CS-2011-5136D). Beach Irvine OCSD Staff has reviewed your Statement and notes that Terra Renewal focuses its complaint y La Habra on three areas: (1) Performance Bond, (2) Evaluation Process, and (3) Pricing. `• La Palma OCSD has included the following in response to Terra Renewal's Statement of Complaint: _�oa Alamitos t Beach 1) Performance Bond L-ange Terra Renewal states that "the District staff's recommendation to waive the Placentia selected Proposer's requirement to provide a performance bond is in violation of ' Sam Ana the requirements of the RFP." &&Beach OCSD Response: To ensure performance, all proposers were required to show Stanton proof of the ability to obtain a performance bond. A performance bond covers the Tustin cost of a bond company to perform the work if the Contractor does not perform (or the expenses involved in issuing another RFP). The selected proposer met the RFP Villa Park requirement concerning the ability to provide a performance bond. Ybrba Linda Mesa After the proposer was selected, OCSD and the proposer entered into the District negotiation process. During those negotiations, it was determined that the bond yory requirement could be waived based on the selected proposer's financial strength ryDisdict and successful work history. Moreover, OCSD maintains multiple contracts for Ranch Biosolids management so as not to rely on any one option, lessening the need for mu)Fct the performance bond requirement. In exchange for this waiver, OCSD received a of Orange reduction in price. Y' 10844 Ellis Avenue Fountain Valley,CA 92708-7018 (714)962-2411 www.ocsd.com ksawJad naDw oft' ti ' Mr.Jeff Thurber � 9 Terra Renewal West, LLC July 23, 2012 Page 2 crr�c T„ M``Pa OCSD did not waive the performance bond requirement included for all proposers during the evaluation of the proposals. It was during negotiation of the final contract that OCSD made a business decision to withdraw the bond requirement. Under the terms of RFP, OCSD has complete discretion to negotiate terms that OCSD deems are in the best interests of OCSD. 2) Evaluation Process Terra Renewal states that "Another basis of our complaint is the District evaluation panel's inequitable evaluation of the proposals . . . . We feel our score would have been higher had the evaluation panel included us in the interview process. The interviewed proposers were given a significant advantage over the other proposers by being able to clarify any questions the panel may have had regarding their proposal." OCSD Response: OCSD's RFP interview process is not used to adjust scoring, but rather to allow the proposers whose scores are most competitive an opportunity to differentiate themselves from the other proposers being interviewed. After evaluating and scoring the proposals to determine which proposers would be interviewed,Terra Renewal scored substantially lower than two other firms. 3) Pricing Terra Renewal states "In their evaluation process, the evaluation panel did not consider the pricing of the proposals when they made their selection . . . ." OCSD Response: Pursuant to the RFP, cost proposals were submitted separately from the technical proposals, so that the evaluation committee could consider qualifications first and then price separately. After determining the two most qualified firms that scored higher than the other proposers by a substantial margin, the evaluation committee considered the cost component of the proposals for those two firms. In the judgment of the evaluation panel, the costs proposed by the top scoring firms were fair and reasonable based on the current market for Biosolids services. This conclusion was based on expert knowledge of the marketplace, including a survey of the Biosolids contracts performed by the Southern California Alliance of Publicly Owned Treatment Works (SCAP). Moreover, it bears noting that, even if Terra Renewal's proposal were given the maximum score of 300 for cost, Terra Renewal would still be ranked well below Tule Ranch—760 points for Terra Renewal vs. 923 points for Tule Ranch. AN$?41 Mr.Jeff Thurber f 9 Terra Renewal West, LLC July 23, 2012 .,: Page 3 M I,y rM N�`Q,O In conclusion, OCSD staff strongly believes the process followed in evaluating the proposals and recommending award was fair to all of the proposers, and the recommended award is in the best interests of OCSD. Therefore, based on the information listed above,your complaint is denied. Sincerely, James D. Ruth General Manager JDR:mrs cc: Chris Marks; Terra Renewal EMT James E. Colston, Environ Compl-Reg Affairs Manager Bradley R. Hogin, General Counsel a 2 ,p Q ¢ n T�cT iN� THE Biosolids Management Program RFP Evaluation Guide S-2011 -513 B D Feb. 2 , 2012 Biosolids Management Program RFP Evaluation Guide This evaluation Guide provides instructions for the following RFP: 1. Specification No. S-2011-513BD Land Application Recycling and Landfill Disposal Options for Biosolx{s Management. Contracts/Purchasing: Chris Yates/Greg Blakeley Project Manager: Tom Meregillano TABLE OF CONTENTS 1. RFP Objective 2. Evaluation Guide Goal/Purpose 3. Evaluation Guide Deliverables 4. Project Scope 5. Project Strategy and Process Flow 5.1 Overall Evaluation Process 5.2 Project Schedule 6. Project Team Roles and Responsibilities 6.1 Responsibilities for All Team Members 6.2 Evaluation Team 7. RFP Evaluation Ranking Definitions 8. RFP Risks 8.1 Critical Success Factors 8.2 Risks 9. Quality Management 9.1 Lists of Pros, Cons, Issues, Questions 9.2 Evaluation Report 10. Evaluators' Worksheets 10.1 Draft Evaluation Worksheet 10.2 Consensus Scoring 10.3 Consensus Scoring Agreement Form 11. Evaluation Guide Approval 11.1 Approved By 11.2 Reviewed By 12. Attachments 12.1 Online Biosolids RFP Evaluator Instructions 3 1. RFP Objective Orange County Sanitation District (OCSD) has a 2003 Long Range Biosolids Management Plan (LRBMP), which provided a number of recommendations for management of biosolids over the next several years. A key recommendation of this plan is the diversification of biosolids products, markets and contractors. As part of the continuation of the LRBMP, OCSD has prepared a Request for Proposal (RFP). We are looking for vendors to propose solutions which will comply with our policy and provide the needed processing capacities in timely and cost-effective manner. 2. Evaluation Guide Goal/Purpose The main purpose of this Guide is to ensure that the evaluation process is fair, transparent and within the guidelines provided by the Purchasing Department. The deliverable will be a Recommendation Report indicating the preferred Contractor and the reasons behind the selection. The results and recommendations from this evaluation will be presented to OCSD's Board of Directors for approval. 3. Evaluation Guide Deliverables As a result of the evaluation procedures described in this Guide,the evaluation team will deliver the following: • Recommendations Report — This report will document the final recommendations that result from the evaluation process. It will summarize the content of the proposals, key points differentiating each, and the scoring each achieved related to the specifications outlined in the RFP. It is anticipated that this document will identify the preferred Supplier, the main reasons for selecting this Supplier, the current state of negotiations, and will recommend that we complete negotiations and award a contract. • Presentation to OCSD's Board of Directors -The Director of Engineering will present the RFP Evaluation Recommendations to the OCSD's Board of Directors for approval. 4 4. Project Scope • Proponents have been requested to propose solutions in response to the issued RFP. • As proposals are evaluated, all team members will compile a list of Pros, Cons, Issues, and Questions related to the proposals. • All team members will contribute to the final consensus scoring of each Supplier's proposal. 5. Project Strategy and Process Flow 1 5.1 The Overall Evaluation Process The evaluation will consist of the follow steps: i. Each proposal will be reviewed to ensure that all mandatory requirements have been met. Proposals failing to meet one or more mandatory requirements will be eliminated from further consideration. The mandatory proposal requirements are summarized in Attachment H of the RFP. ii. Each proponent's Financial Capabilities will be reviewed and scored by the representative from Finance/Accounting. iii. The evaluation team will review each proposal and determine if any clarifications are required. If so, Proponents will be contacted by OCSD. Discussions may be conducted with Proponents who submit proposals determined to be reasonably susceptible of being selected for award for the purpose of assuring full understanding of and responsiveness to solicitation requirements. iv. The evaluation team will determine a preliminary score and rating for each proposal using the evaluation procedures, evaluation criteria and weights described in Section 5 and 6 of the RFP. V. Based on the scores,the evaluation team may prepare a short-list of those proposals which are judged as being capable of providing an acceptable solution. Evaluation team may require a visit to a Proponent's site as part of this process. vi. The evaluation team will open and score (using a pre- determined scoring formula) the costs of the shortlisted 5 Proponents. This scoring may or may not further narrow the shortlist. vii. The Proponents on the short-list, or all Proponents, may be required to give a presentation explaining their proposal and addressing requested clarifications. The scores will then be finalized. viii. These Proponents the short-list, or all Proponents, may be asked to submit Best and Final Offers. (A brief explanation about Best and Final Offers is contained in Attachment-I.) In conducting discussions, there shall be no disclosure of any information derived from proposals to competing Proponents. Proposals submitted in response to Best and Final Offer will be re-assessed using the same evaluation criteria and scoring mechanisms that were used to score the original proposals. This analysis will produce a score for each proposal. Evaluation Team may then select one or more of the highest scoring proposals for negotiation of appropriate contract(s). Proposals will be selected in order of decreasing scores. 5.2 ProjectSchedule The project schedule may be found on the Sharepoint Biosolids RFP Workspace http://sharepoint/workspace/Biosolids%20RFP/default.aspx. 6. Project Team Roles and Responsibilities 6.1 Responsibilities for All Team Members 6.1.1 An evaluation team member plays an active role in the selection of Contractors. 6.1.2 A n objective process will determine the best overall Proponent for a given proposal. 6.1.3 Evaluation criteria are items of importance that will be considered when reviewing the proposals of each Proponent. The evaluation criteria and weights have been included in the Request for Proposal (RFP) documents. The detailed breakdown of how points will be assigned must be set prior to the proposal opening. 6.1.4. During the RFP process, the designated representative from Purchasing is the ONLY person authorized to release results or communicate with the Proponent. All requests for further information or clarification must be forwarded to the Purchasing representative. 6 6.1.5. All proposals and corresponding information are CONFIDENTIAL. This information is not to be discussed with anyone outside the evaluation team. 6.1.6. An evaluation team member shall understand and abide by the provisions of OCSD's "Conflict of Interest" policy. 6.1.7. While serving as an evaluation team member, all possible conflicts of interest will be disclosed promptly to the Purchasing Officer. 6.1.8. The integrity of the RFP process should be beyond reproach. 6.2 Evaluation Team The Evaluation Team is comprised of six evaluators who will contribute to the consensus scoring. Chris Yates of OCSD Purchasing/Contracts Division, and Michael Asner, an external consultant, overlook the process to ensure fairness within the process. OCSD's outside legal advisors, Woodruff, Spradlin & Smart, have contributed to the RFP and will be involved in the contracting process. Each team member is responsible to review and evaluate each of the proposals, compile lists of questions/issues for submission to the suppliers, to attend Supplier presentations, and to deliver input into the process of selection. 7 7. RFP Evaluation Ranking Definitions 7.1 Exceptional (90 to 100)— o The approach will yield a result that exceeds the Objectives qualitatively. o The proposal offers an approach or features with little or no risk. o The response covers areas not originally addressed within the RFP category and includes additional information and recommendations that would prove both valuable and beneficial to OCSD. o This response is considered an excellent approach demonstrating the Proponents authoritative knowledge and understanding of the project. 7.2 Exceeds Objectives (70 to 89)— o A very good response that shows experience and knowledge within the category. The Proponent provides insight into their expertise,knowledge and understanding of the subject matter. o The collective approach yields a qualitative benefit to the project that is beyond the minimum objectives. o The approach being proposed or the majority of the features are acceptable or above the objectives set out in the RFP. o The Proponent can easily implement additional features or options. A minimal number of resources will be required from OCSD. 7.3 Meets Objectives(50 to 69) — o The approach or the majority of the features proposed meet the objectives. o No apparent deficiencies noted. Some items could be improved upon but are still considered acceptable. To enhance them may require rework and resources from the Proponent and/or OCSD. o The ranking should reflect some qualitative achievement(s) such as acceptable delivery timeframe, end-user training program, etc. 7.4 Fails to Meet Objectives (below 50)- o The proposed approach or a majority of the features for the item are deficient. The approach taken is undesirable and correction would require a major and material change in the proposal. o The correction of any deficiencies either collectively or individually, poses a serious problem in correction or has a "domino" effect on the other design features. 8 8. RFP Risks 8.1 Critical Success Factors Proponent's Proposal Format —the format of the all proposals should be similar to make the job of comparison easier. The format has been suggested in the RFP but we are not assured that all proponents will respond as requested. Complete Proposal Review —the proposal evaluation team must work diligently to ensure that they understand the complete content of the proposals. It will not be appropriate to, for example, read the executive summary and financial summary and jump to conclusions. A complete and thorough evaluation of all content is required. List of Pros, Cons, Issues,and Questions —in reviewing each proposal, all team members must compile a list of Pros, Cons, Issues, and Questions. This list will form the basis for discussion in the initial review meeting and when the team performs consensus scoring. All team members must participate. Consensus Scoring — The consensus scoring is an essential part of this process.All team members must participate and understand that this grading will lead to a recommended supplier. Schedule —It will be essential for all team members to adhere to the schedule for this project to be successful. 8.2 Risks We have hired Michael Asner to assist the Project Team in identifying and mitigating the major risks associated with this procurement process. Risk of Litigation — This risk is due to the competitive nature of this project. What if a Supplier that is not selected calls their lawyer immediately? What can OCSD do to ensure that we are protected, and that our decision is not challenged? • All team members must completely review each proposal; • All team members must contribute to the list of Pros/Cons/Issues/Questions in writing; • All team members must attend review meetings and Supplier presentations, minutes must be recorded; • All team members must work diligently towards achieving consensus scores; 9 • No team members are allowed to communicate in private directly with the Suppliers until the competition has ended. All communications must go through Purchasing, or more specifically, Chris Yates, Contracts/ Purchasing, Senior Buyer. • In the end, OCSD's recommendation must have strong foundation in the form of a Recommendation Report. There must be compelling and documented reasons why the Project Team recommends the preferred supplier. • If there are any reasons why a team member cannot meet a project obligation, he or she must inform the project manager as soon as possible. All team members must obtain permission from their departments to participate in this evaluation. Risk of No Adequate Proposals — There is a chance that we receive no proposals that are deemed appropriate or adequate, for a number of reasons. What can OCSD do to ensure that we receive a winning proposal? What should OCSD do in the event that we do not? • A high quality Request For Proposal document is OCSD's best weapon against this risk. The proper amount of time and planning has been devoted to ensure a quality document. • OCSD should not compromise its objectives. If no suitable solutions or Suppliers are presented, OCSD should address the process and possibly re-start. Risk of Inability to Reach Consensus —There is a slight probability that we receive a proposal that pleases half of the evaluation group, and another that pleases the other half. What can OCSD do to ensure that we can get by an impasse of that sort? • The Project Manager and Contracts/Purchasing will attempt to facilitate a process which results in consensus. • Issues that appear to be "show-stoppers", not allowing consensus to be reached, will be brought up to the OCSD Management for resolution. • All team members must be reasonable and listen to the views of others. Review the project objectives and goals to stay focused. A balanced approach to evaluation should allow team members to reach consensus. 10 9 Quality Management 9.1 Lists of Pros, Cons, Issues,Questions The Lists of Pros, Cons, Issues, and Questions are essential to achieving a quality product. These lists should be prepared by each Evaluator. 9.2 Evaluation Report The Recommendation Report has to be a well-organized document that illustrates a fair comparison of the proposals. It should identify the pros, cons, issues, and questions clearly and in a well-organized fashion. It must identify the final consensus scores in a concise, easy to understand format, make a clear indication of the preferred supplier, and the main reasons for making the recommendation. 10. Evaluator's Worksheets 10.1 Draft Evaluation Score Sheet—this worksheet will be used in your first draft evaluation to discuss your projected scores and comments with the evaluation team. 10.2 Consensus Scoring—this online worksheet will be used for team scoring. The online documentation is input by Contracts/Purchasing. 10.3 Consensus Scoring Agreement Form —this signature form provides back-up documentation that the team is in agreement with the Consensus Scoring. 11 Evaluation Guide Approval 11.1 Approved by: Contracts/Purchasing, Chris Yates, C.P.M., CPPB. Project Manager,Tom Meregillano 11.2 Reviewed by: Michael AsnerConsulting 12 Attachments 12.1 Attachment 1: Online RFP Evaluator Instructions 11 Michael Asner Consulting MSuite 2003 Our 28th Year in Business 1028 Barclay St. Vancouver, BC 1984 — 2012 Canada V6E OB1 June 6, 2012 Marc Dubois Contracts, Purchasing and Materials Manager Orange County Sanitation District 10844 Ellis Avenue Fountain Valley, CA U.S.A. 92708 Dear Marc I am writing this report in my capacity as Fairness Advisor for OCSD's RFP S-2011- 513BD which was issued on Dec. 13, 2011. My role on this project was to help OCSD ensure that the RFP process was conducted in a way that is fair, open and transparent to all interested parties. This RFP process consisted of a number of distinct steps. Each major step and my comments on it is described below. 1 . The RFP was prepared by the Procurement Officer, Chris Yates, working with the Evaluation Committee and stakeholders and released on Dec. 13, 2011. 2. A non-mandatory Pre-Proposal telephone conference was held on Feb. 21, 2012. Vendors could participate by dialing in to the conference call. 3. Questions were received by OCSD and answered via addenda posted to OCSD's planetbids' web site. 4. Six proposals were received. • Avagro Systems • McCarthy Family Farms • Nursery Products • Synagro • Terra Renewal LLC • Tule Ranch 1 5. The Synagro proposal was disqualified as it failed to satisfy a mandatory requirement and several of the minimum requirements. 6. The remaining five proposals were reviewed, clarifications were identified and preliminary scores were assigned to the technical and management sections. 7. During the analysis, the Evaluation Committee identified two issues related to contracting that required input from OCSD's counsel. A letter was sent to Counsel. Counsel responded in writing. The issues were resolved to the satisfaction of Counsel, the Procurement Officer and me. 8. Of the five proposals, three obtained low scores and were eliminated from further consideration, without any examination of their costing proposals. These firms were Avagro Systems, Nursery Products, and Terra Renewal LLC. 9. For the two remaining proposals, those from McCarthy Family Farms and Tule Ranch, the cost proposals were examined and found to be complete and acceptable. 10.The two highest ranking proposals, McCarthy Family Farms and Tule Ranch, were sent letters identifying issues requiring clarification and inviting each to submit clarification letters and to meet with the Evaluation Committee to discuss its proposal. 11.Meetings were held with Tule Farms on May 23, 2012 and McCarthy Family Farms on May 24. 12.During the meeting with McCarthy Family Farms, McCarthy Family Farms acknowledged that it was lacking the required permitting and could not commit to the prices stated in its proposal. For these reasons, McCarthy Family Farms asked that it be permitted to withdraw its proposal. This was agreed to by the Procurement Officer. 13.Notice of Intent to Issue a Contract was sent to Tule Ranch. This RFP process (with the exception of the approval of the Board to award a contract to Tule Farms) is now complete. OCSD will provide a debriefing to those unsuccessful vendors that request one. I was involved at every stage of this RFP process, from the RFP development phase through to the completion of the evaluation process. I am satisfied beyond any doubt that OCSD conducted a process that was rigorous and fair to all interested parties. During the evaluation phase, OCSD made consistent efforts to develop procedures and approaches that were designed to avoid giving an unfair advantage to any Respondent, ensuring that each eligible Respondent was provided the same information on a timely 2 basis. I am also satisfied that the RFP Process was conducted in accordance with the requirements prescribed in the RFP and with the concurrence of legal Counsel. If you have any questions that arise from this description, I will be pleased to respond. Yours truly Michael Asner Consulting ^"�e �s Michael Asner Fairness Advisor 3 Southern California Wastewater Agencies Cost Comparison (2010 SCAP Survey versus 2012) 2010 SCAP SURVEY COST COMPARISON 2012 COST COMPARISON Total with Location Approx. Mileage Base Cost Approx. Location Approx. Agencies Fuel (Round Trip) per Ton Total Miles 2010 Cost Cost 2012 Cost Per mile (Hauling Per Mile and Fuel) City of L.A. $30.32 Merced, 224 $3.38 $48.50 $48.50 Merced, CA, La 576 $2.11 CA Paz , AZ, and Yuma AZ LACSD $37.50 Kern, CA 320 $2.93 $48.00 $48.00 Yuma, AZ 520 $2.31 (Emergency Contract for 2012-2013 OCSD $49.70 Yuma, AZ 580 $2.14 $54.50 $54.50 Yuma, AZ 532 $2.56 (at current fuel rate) City of N/A N/A N/A NA $47.79 $47.79 Yuma, AZ 444 $2.69 Riverside (Emergency 90 day Contract) City of N/A N/A N/A N/A $39.95 $49.95 Yuma, AZ 406 $3.08 Oceanside City of N/A N/A N/A N/A $49.00 $49.00 Yuma, AZ 468 $2.62 Corona Eastern $55.00 Yuma, AZ 614 $2.24 $46.50 $46.50 Yuma, AZ 431 $2.70 2010 SCAP SURVEY COST COMPARISON 2012 COST COMPARISON Total with Location Approx. Mileage Base Cost Approx. Location Approx. Agencies Fuel (Round Trip) per Ton Total Miles 2010 Cost Cost 2012 Cost Per mile (Hauling Per Mile and Fuel) Municipal WD Encina $48.50 N/A 205 $5.91 $47 $51.28 Yuma, AZ 390 $3.29 Wastewater Authority San Elijo JPA $42.50 N/A 378 $2.81 $42.45 $42.45 Yuma, AZ 378 $2.81 City of N/A N/A N/A N/A $36.00 $36 Yuma, AZ 370 $2.43 Escondido Goleta $39.58 Kern, CA 360 $2.75 N/A N/A N/A N/A N/A Sanitary District Valley $44.49 AZ 146 $7.61 N/A N/A N/A N/A N/A Sanitary District 2010 Total 2012 Total Total Cost Range 2010 SCAP Survey Cost Range 2012 Total Cost Range Cost Range Per Per Mile/Median Mile/Median $2.14-$7.61 / $2.11-$3.29/ $30.32-$55.00 $2.87 $36.00-$54.50 $2.66 r Terra Renewal West, LLC 12812 Valley View St,Suite 9 TERRA Garden Grove,California 92845 renewal August 1, 2012 Ladies and Gentlemen of the Board: The August 1, 2012 Operations Committee Agenda Report Item No. 6 part C is a recommendation from District staff recommending the approval of a contract with Tule Ranch to manage OCSD biosolids. District staff details their reason to award a contract to the selected contractor over Terra Renewal in the Agenda Report. We would like to address the Agenda Report's reasons for not selecting Terra Renewal. 1. This award in not based on the low bid. We understand this was a proposal process and not a bidding process. But the proposal scoring process is subjective which may have led to discrepancies in scoring. A low score in the qualification section eliminated our price from being considered. All proposal should be evaluated for all factors of the proposals including price. District staff states a reason for their selection was that it is important that"OCSD contractors adhere to the highest standards in managing OCSD's biosolids." If Terra Renewal did not adhere to the highest standard, why did Terra Renewal land apply 150,000 of OCSD's biosolids since 2008? 2. Tule Ranch is the most qualified by a substantial margin. Terra Renewal manages more biosolids than any other company in southern California. We manage the biosolids for: o City of Los Angeles o Los Angeles County Sanitation District o City of San Diego o City of Riverside o City of San Bernardino o SOCWA o City of Oceanside o City of Corona o City of Colton o Encina Wastewater Authority 3. Terra Renewal substantially overstated the cost difference. The Agenda Report misstated our claim that the District would save$6 million by using Terra Renewal. We clearly stated that if the selected contractor were to manage '/2 of the District's biosolids over 10 years, our price difference would save the District $6 million. The Agenda Report wrongly says we claimed the savings were over 5 years. 4. OCSD staff negotiated with Tule Ranch, and the price is fair and reasonable. The selected contractor's price is above the current market price for biosolids land application. The District used the land application rates from 2010 for determining what is considered"fair and reasonable". But since 2010,biosolids management pricing has decreased without factoring fuel. Tule Ranch submitted a land application price to the City of Escondido of$36 per ton on May 10,2012. The current market rate for biosolids land application is $36-$50 per ton. 5. The process was fair. The District continues to claim the process was fair when they admit that pricing of all proposals was not taken into consideration. And despite receiving 5 viable proposal, OCSD only interview 2. In the Agenda Report, OCSD staff recommends the Board approve a contract with Tule Ranch under basic terms. The following is a comparison Tule Ranch's terms to Terra Renewal's according to the submitted proposals: Land Application Price without Bond Tule Ranch- $54.50 per ton Terra Renewal - $46.38 per ton Landfill price Tule Ranch- $69.00 per ton Terra Renewal - $67.00 per ton Hauling only for Orange County landfill Tule Ranch- $6.00 per ton Terra Renewal - $6.00 per ton(we would match this price if asked) As a Orange County Sanitation District ratepayer myself and as a local Orange County company, we ask you to consider these 4 alternatives: 1) Suspend all decisions until a full and complete Board is present and can act on this decision 2) direct District staff to send these services out to bid or 3) cancel the present solicitation and re-solicit proposals which would be awarded that included all the factors, including price from all proposers,before making any recommendations. 4)That the contract be awarded to Terra Renewal to prevent the$2.1 —2.80M additional cost the District would otherwise incur. Sincerely, Jeff Thurber General Manager Terra Renewal West, LLC Cesar Garcia From: Chris Marks [chrisamarks@comcast.net] Sent: Wednesday,August 01, 2012 4:12 PM To: Cesar Garcia Subject: please print the email Ladies and Gentlemen of the OCSD Board of Directors: Terra Renewal West, LLC (Terra Renewal) had drafted a letter for the District's Board of Directors regarding District staffs recommendation to award a contract to the incumbent contractor for biosolids land application service. We were going to submit the letter before the next Board of Director's Meeting on August 25 Meeting because District staff told us the Board would only discuss our Statement of Complaint at the Operation's Committee. But on Monday afternoon the District posted the Agenda for Wednesday's Operations Committee meeting and we discovered District staff is trying to get this contract awarded at the Operation Committee meeting where not all Board members are present. We are concerned that District staff is trying to circumvent the full Board to get a favorable decision on their recommendation and we have been given little time to address the Board. OPERATIONS COMMITTEE AGENDA REPORT The District's Agenda Report contains some previously undisclosed information regarding the evaluation process that make staffs recommendation even more questionable than we originally discovered. The proposal's scoring results highlight the subjectivity to the proposal process because Terra Renewal manages more biosolids than the incumbent contractor yet Terra Renewal scored lower in the qualifications section of the proposal. The Agenda Report states the selected contractor "has the closest land application sites in Arizona" when Terra Renewal is offered the same farm as the incumbent. Why the exaggeration? The Agenda Report misrepresents Terra Renewal's previous statements. District states in the Agenda Report "Terra Renewal claims that the Terra Renewal price would save OCSD$6 million over five years." Terra Renewal never made that claim. Terra Renewal stated that the District could save$6 million dollars over 10 years based on managing% of the District's volumes. Terra Renewal's volume estimate was based on the District's own statements in their June 27 Agenda Report. The Agenda Report confirms District staffs lack of concern regarding costs of this service. District staff state in the Agenda Report that$2,100,000 "in perspective" is only 2.1%of the amount the District spends on biosolids management. District staff is down playing the significant savings Terra Renewal has offered the District. And, with the District removing the requirement of a performance bond,Terra Renewal would have saved the District$2,800,000 over 5 years, even more than we originally thought. District staff tries to downplays these savings by saying OCSD has budgeted $100 million for biosolids management. OCSD budget assumes an average price for biosolids management of$73 per ton. As of today,the District is paying an average $59.25 per ton for biosolids management from what we could determine. Using today's actual cost of biosolids management for the District, Terra Renewal would actually save the District 3.4%of the$81 million cost over the next 5 years. i Additidnally, the Agenda Report states the District's proposal process was established to select the best value for OCSD since OCSD has a great deal at stake. If Terra Renewal's land application services put OCSD at risk, why has OCSD allowed Terra Renewal to land apply over 150,000 tons of the District's biosolids since 2008, as has LACSD, City of Los Angeles, City of San Diego, City of Riverside, City of San Bernardino, City of Oceanside, etc.? Clearly Terra Renewal's land application operations have not threaten the sustainability of OCSD's biosolids management program over the past four years, and all we will do in our proposal is save the District up to$2,800,000 over the next 5 years if no performance bond is required. Given the full Board's questions regarding the approval of this contract and our attached letter that points out District staff's misleading and contradictory statements to the Board, we ask the Board postpone a decision on this contract until the next Board of Director's meeting. If the Board has any questions regarding our letter, please contact our General Manager,Jeff Thurber, at (949) 678-3153, or by email at Jeff.Thurber@TerraRenewal.com. Chris Marks Assistant General Manager Terra Renewal West, LLC z MEMO August 1,2012 OCSD General Manager Recommending Board Overpay $2,800,000 for Biosolids Land Application Services DISTRICT STAFF MISGUIDED BOARD TO GET THE BOARD TO AGREE TO AWARD A CONTRACT FOR BIOSOLIDS LAND APPLICATION • Exaggerated proposal scores in subjective proposal process (June 27 Agenda Report) • Misinformed Board saying Selected Contractor was the "one viable proposal" (June 27 Agenda Report) • Claimed the District has a proposal award protest process although they didn't (Board of Director's Meeting) • Misguided Board to say Selected Contractor's site is closest site to OCSD (Terra Renewal operates at the same farming location) (Operation's Meeting Agenda) • Made contradicting statements regarding negotiating a final price(Board of Director's Meeting and Operation Committee Agenda) • Made contradicting statements that staff changed proposal scoring as part of interview process (Debriefing meeting and Response to Statement of Complaint) DISTRICT STAFF SELECTION PRICE ABOVE CURRENT MARKET RATE Selected Contractor's rate with OCSD is above market rate • Incumbent Contractor bid price for City of Escondido at$36.00 per ton • Terra Renewal's proposed price to Escondido was $39.67/ton Market Rate for land application is $36-$50/ton in today's competitive market DISTRICT STAFF HAS 16 YEAR RELATIONSHIP WITH INCUMBENT CONTRACTOR(Allowing contract to be amended without going to bid) Terra Renewal West,LLC 12812 Valley View St,Suite 9 TERRA Garden Grove,California 92845 renewal August 1,2012 Ladies and Gentlemen of the Board: Terra Renewal West,LLC(Terra Renewal)has made every effort with Orange County Sanitation District(District) staff to address and expose the flaws that were made in the process of awarding the District's biosolids land application contract. District staff feels it is more important that they stick to their flawed process and not admit that any mistakes in their evaluation process that may have been made than to select a qualified, viable contractor that can successfully perform these services. In fact,District staff s response letter to Terra Renewal's Statement of Complaint confirmed that the District's selection will cost the District at least$2,800,000 over the next five years if a bond is not required. It appears that District staff has been so intent to defend their process that they made misleading and contradictory statements in their Agenda Report to the Board of Directors and at the June 27,2012 Board meeting to exaggerate the results of their selection process. Because District staff refuses to reconsider their decision,we are appealing to the Board to either award this contract to Terra Renewal to realize the $2,800,000 savings for the District, or direct District staff to send these services out to bid to eliminate the subjectivity of a proposal process so District staff can select the lowest responsive and viable bidder. Our appeal to the Board comes in light of the District's letter response to Terra Renewal's Statement of Complaint. In this letter,District staff makes statements that seem to contradict the rationale for their selection process of selecting only the highest scoring proposal. Staff uses the defense of allowing the selected contractor to avoid providing a performance bond for this contract as a"business decision"by the District, and states the District has "complete discretion"to act in the"best interests of OCSD." Now,District staff claim that removing the requirement of a bond led to a reduction in the selected contractor's price. But it was Terra Renewal's proposal that states, "If OCSD removes the requirement of providing a faithful performance bond,Terra.Renewal West can decrease our price by approximately 3%, or approximately$1.50 per ton." Waiving the bond requirement means Terra Renewal's price would have been$6.12 per ton less than the selected contractor had they waived the performance bond requirement for Terra Renewal,a$2,800,000 savings over the District staff's selected contractor (11% savings). We reviewed the selected contractor's proposal and the selected contractor made no statement that they would drop their price had the performance bond requirement been waived that we could find in their proposal. How is selecting a contractor that costs $2,800,000 more than another viable and capable company a good"business decision"in the best interest of the District? And, did the District staff use Terra Renewal's proposal language to get the selected contractor to drop their price? The District's letter response to our Statement of Complaint(Response Letter)also seems to contradict the District's reason for soliciting these services through a proposal process instead of a bidding process. While explaining that a performance bond is unnecessary, District staff states"OCSD maintains multiple contracts for Biosolids management so as not to rely on any one option." District staff made this same comment at the June 27 Board meeting adding that there is no risk if the contractor fails. These comments seem to reinforce that fact that the District should select the lowest priced viable proponent for these services since there is no risk if the contractor fails to perform. If there is no risk in selecting a contractor if they do fail,why would the District pay a higher price for the same service? Then, after we asked one staff person from the District how they can justify overpaying for their biosolids land application services,the staff person responded that the District requires a lot from their contractors so the District should pay more. This was an acknowledgement from District staff that they do not think overpaying for land application services is important. District staff stated that Terra Renewal is a viable and qualified land application company,and that there is no risk in executing this contract, so why would the District not select Terra Renewal to save $2,800,000 over the next five years? District staff stated that Terra Renewal is a viable and qualified land application company, and that there is no risk in executing this contract, so why would the District not select Terra Renewal to save$2,800,000 over the next five years? Several other statements in the Response Letter contradict statements made by District staff regarding the award recommendation since the June 27 Board meeting. These contradictory or inaccurate statements made by staff in this letter,as well as in the June 27 Agenda Report and debriefing meeting,have shown a pattern by staff to push through their selection. Terra Renewal has included the following misleading and inaccurate statements made to the Board and during the Statement of Complaint Process: Misleading and Inaccurate Statements Board Agenda Report After District staff made their selection for award of this contract,District staff submitted an Agenda Report to the Board detailing why they made their recommendation. After the conclusion of the June 27t'Board meeting and the June 28t'debriefing meeting,we determined there were several misleading and inaccurate statements District staff made to the Board in the Agenda Report. One misleading statement in the Agenda Report was regarding the number of viable proposals the District received. The Agenda Report states "OCSD's evaluation panel narrowed the proposals to one viable proposal,"and recommended awarding a contract to the one viable proponent. However, during the Board meeting,the Fairness Consultant, responding to a question regarding Terra Renewal's viability, stated"Terra,like several other vendors were viable." When Terra Renewal asked the Fairness Consultant at the debriefing meeting why the Agenda Report said there was"only one viable proposal",he responded that the words"one viable proposal"was"not probably the right wording." He then said that"viable was an inappropriate word to use." By stating that OCSD's evaluation panel narrowed the proposals to one viable proposal gives the Board the impression that the District has no other viable option for these services. This is not true and misleading to the Board. The Fairness Consultant himself stated at the Board meeting that there are several viable proposals. Another misleading statement in the Agenda Report was regarding the scoring comparison of the proposals. The Agenda Report provided a Proposal Evaluation Table with the Consensus Score of each proposal. The Proposal Evaluation Table shows the scores of all proponents based on a total of 1000 points. But only the incumbent contractor's,Tule Ranch, score is actually based on 1000 points since only their proposal's pricing was considered for evaluation. The other three listed proposals' scores were based on a scale 700 points since their pricing was not considered(pricing was a 300 point category in the evaluation process). This was not clarified to the Board during the Board meeting,and was not made clear to Terra Renewal until the debriefing meeting the day after the Board meeting. District staff provided the Board a table that exaggerates the scoring difference between the proponents,which gives the appearance that one proposal scored more than twice the points than any other proposal. Table 1.Actual Agenda Report Proposal Evaluation Table Comparing Proposal's Scoring PROPOSAL EVALUATION TABLE Tule "Terra Avagro Nursery McCarthy Ranch Renewal Products Fancily Farms Consensus 92311000 4=1OW 240t1p00 14W10W Scare 11Vandrawrt Ranking 1 2 3 4 Table 2. Table Developed Using Scores of Proposals After the Evaluation Phase (Using District Provided Information) Tule Terra Avagro Nursery McCarthy Ranch Renewal Products Family Farms Consensus 670/700 460/700 240/700 140/700 withdrawn Score June 27,2012 Board of Director's Meeting At the June 27 Board meeting, an inaccurate statement was made regarding the District's protest process. During the Board of Director's meeting,the Board asked staff specific questions regarding the proposal process. One important question asked by the Board was if the District had a formal protest process. The District's Environmental Compliance Manager replied either"yes"or"there is". However, during the debriefing meeting,District staff admitted that there is no formal protest process in the proposal or provided by the District. District staff said that the Environmental Compliance Manager "misspoke"during the Board meeting and staff should have corrected the Environmental Compliance Manager's statement to the Board. The lack of a formal protest process was again confirmed via email by District staff to Terra Renewal on June 29. The staffs inaccurate statement that the District does have a formal protest process was a crucial statement that appeared to influence several of the Board's members' decision on whether or not to award a contract to the selected proponent. As you know,Terra Renewal submitted a letter to the Board at the June 27 Board meeting with the concerns we saw with the staff s decision to award a contract to the selected proponent. But,as a Board member pointed out,if there was a formal protest process,Terra Renewal did not follow that process, and the Board should follow the District's own process by awarding the contract according to staffs recommendation. That inaccurate statement could have lead to the award of a contract for these services at the June 27 meeting and the District would be stuck overpaying for their biosolids land application services for the next 5-10 years. Letter Response to Terra Renewal's Statement of Complaint There are other contradictory statements made by District staff in addition to the contradictory statements made in the District's Statement of Complaint Response Letter detailed earlier in this letter. When justifying staff s decision to waive the selected contractor's requirement to provide a performance bond,District staff says "In exchange for this waiver, OCSD received a reduction in price." However, during the Board meeting,District staff stated that the District accepted the selected proponent's price as provided in the proposal, and the District did not negotiate a lower price. Why is District staff now saying that they received a reduction in price,but in the June 27 Board meeting they stated no reduction was negotiated? Another contradictory statement in District's Response Letter was regarding the District's RFP interview process. The Response Letter states the interview process"is not used to adjust scoring"of proposals. This contradicts the statements made by District staff during the debriefing meeting held with Terra Renewal where they stated that the scoring of the interviewed proponents could be changed based on clarifications they provided regarding their proposal. If proposal scoring is changed for the interviewed proponents only and not all viable and qualified proponents are interviewed,the evaluation process is inequitable. District's High Cost Justification In the District's Response letter staff states that the selected contractor's price is"fair and reasonable based on current market for Biosolids services"based on expert knowledge. But, according to the latest public procurements for biosolids management over the last two years,the selected contractor's price is much higher than pricing that even they have provided to another City on May 10,2012. Over the last two years, four biosolids management contracts have been awarded by larger biosolids generators. The current rates for those projects,based on diesel fuel price of$4.00 per gallon,range between$36.00 per ton and$48.53 per ton(see chart below). The selected contractor's price of$54.50 per ton is outside that range. Biosolids Generator Awarded Contractor Rate Per Ton City of Escondido Tule Ranch $36.00 City of San Bernardino McCarthyFamily Farms $42.00 LACSD—Valencia McCarthyFamily Farms $42.50 City of Colton Terra Renewal $46.30 City of Corona Nursery Products $42.00 OCSD Terra Renewal proposed $48.53 OCSD Tule Ranch proposed $54.50 The District staff did admit they only considered the pricing of the two"most qualified" proposals instead of all considering the pricing of all the viable and qualified proposals. This failure to consider pricing has lead to the recommendation of the high priced contractor. But,as a District staff person told us,the District needs to pay more for their biosolids services because the District is difficult to deal with. That is an absurd excuse of why the District would recommend overpaying$2,800,000 of ratepayers money. Conclusion The District's decision to use a proposal process to select a contractor for services that the District themselves acknowledge presents little risk to the District has created a questionable contractor selection process. The District staff acknowledges they did not consider the cost of the five viable proposals submitted when making their selection. This has led to the District staffs selection of a contractor that costs at least$2,800,000 more than Terra Renewal,a contractor that exceeded the proposal objectives according to the proposal scoring results. As described in this letter, District staff has made numerous inaccurate and contradictory statements to the Board to justify their proposal process. This has created the appearance that District staff is willing to overspend for biosolids land application services instead of admitting mistakes in their evaluation process. District staff s misleading and contradictory statements has also created an appearance of bias. Then the District spent money on a"Fairness Consultant"to justify their flawed proposal evaluation process. This appears to be another waste of the District's money. With the District's history of hiring consultants for questionable reasons,like the District's former yoga instructor,the use of the"Fairness Consultant"has only led to a confusing proposal evaluation process that ignored cost when evaluating proposals and another waste of the District's money. The District's Board of Directors duty is to provide oversight of District staff when staff makes questionable decisions. Staffs decision to select a contractor that costs $2,800,000 more than another qualified,viable contractor for services that pose little risk to the District is questionable at the least, and fiscally irresponsible. As a Orange County Sanitation District ratepayer myself and as a local Orange County company,we ask that you award this contract to Terra Renewal to save your ratepayers significant money,or direct staff send these services out to bid,not a RFP, and award a contract to the lowest responsive bidder. Sincerely, Jeff Thurber General Manager Terra Renewal West,LLC Timeline of Tule Ranch Contract with OCSD December 1996 Start of Agreement-$19.00 per ton 1998 1 year extension 1999 1 year extension 2000 1 year extension 2001 1 year extension 2002 1 year extension-$25.40 per ton January 2003 Amendment to Agreement#1 Addition of western Arizona for$38.75 per ton and other sites 1 year agreement with 4— 1 year extension options 2004 1 year extension 2005 1 year extension 2006 1 year extension 2007 1 year extension end of Agreement 2008 Amendment to Agreement#2 Increase Arizona rate to $46.80 per ton 1 year agreement with 4— 1 year extension options 2009 1 year extension Amendment to Agreement#3 Remove Kern County from contract 2010 1 year extension 2011 1 year extension 2012 1 year extension end of Agreement-$54.49 per ton AGREEMENT FOR THE MANAGEMENT OF BIOSOLIDS — LAND APPLICATION AND LANDFILL DISPOSAL This Agreement for the Management of Biosolids — Land Application and Landfill Disposal ("Agreement") is made and entered into, to be effective this day of by and between: ORANGE COUNTY SANITATION DISTRICT, a County Sanitation District, (hereinafter referred to as "District" or"OCSD") AND TULE RANCH, of, Fresno, California, a company, (hereinafter referred to as "Contractor") The District and Contractor are sometimes individually referred to herein as each "Party," and collectively referred to herein as the "Parties." RECITALS WHEREAS, Contractor represents that it has the expertise and qualifications necessary to perform the Biosolids Management services described in this Agreement in a highly competent manner. Contractor further represents that it has demonstrated competence in providing the type of services contemplated by this Agreement. Contractor acknowledges that District is relying on these representations in entering into this Agreement; and WHEREAS, subject to the specific terms and conditions set forth herein, Contractor desires to enter into this Agreement with District for removal and processing of the District's dewatered Biosolids; and WHEREAS, subject to the specific terms and conditions set forth herein, Contractor and District desire to enter into this Agreement providing for: (i) the transportation and management of the District's Biosolids in Yuma County, Arizona; (ii) the transportation and management of the District's Biosolids to other sites or facilities as directed by the District; and (iii) the permitting of the Biosolids Management sites and Contractor's management of operations with District's Biosolids thereon; and WHEREAS, District desires to have Contractor beneficially use District's Biosolids at its permitted use sites for land application or proper disposal of biosolids into permitted landfills in accordance with the specific terms and conditions set forth herein; and 872230.2 WHEREAS, Contractor represents that it has valid permits from the State of Arizona Department of Environmental Quality, applicable California Regional Water Quality Control Board, County Health Services Departments, and any other Federal, State, Regional and/or local Regulatory Agency as necessary, to operate a program for beneficial use or disposal of Biosolids. Contractor shall forward to District copies of all necessary permits secured in respect to said operations, as defined herein. Contractor has a number of existing sites located in, but not limited to, Arizona, that are permitted for the management of Biosolids under these permits ("Existing Sites"); and WHEREAS, the District is working with the Orange County Waste and Recycling to secure entry into their local Orange County landfills, and Contractor is anticipated to transport, haul, and deliver Biosolids in amounts determined by the District in the event this option is implemented; and WHEREAS, the District is interested in utilizing other sites or facilities as a way to further diversify its portfolio of Biosolids management options, including, but not limited to, analyzing the suitability of District Biosolids at different facilities, providing District Biosolids for research or demonstration facilities, or investigating the suitability of a facility in meeting District tracking and documentation requirements; therefore, from time to time, Contractor is anticipated to transport, haul, and deliver Biosolids in amounts determined by the District to other sites or facilities as directed by the District. NOW, THEREFORE, in consideration of the mutual promises and covenants set forth herein, the Parties agree as follows: Section 1. Definitions 1.1. Biosolids. Means the primarily organic material removed and digested to clean municipal waste water or domestic sewage. The District's Biosolids meet the non- hazardous material standard according to the California Administration Code's procedures and the U.S. Environmental Protection Agency's (EPA) Toxic Characteristic Leaching Procedures test. In addition, Biosolids shall meet the EPA's Pollutant Limits, as established in 40 Code of Federal Regulations Part 503-Sewage Sludge Regulations (Table 1) and shall also meet the EPA's Class B Pathogen Reduction and Vector Attraction Reduction Requirements as stated in 40 Code of Federal Regulations Part 503 Sewage Sludge Regulations. Grit and screenings removed during the wastewater treatment process shall not constitute Biosolids. Digester cleanings are considered Biosolids, and may meet Class B requirements. 1.2. Biosolids Management. Means the transporting, accepting, delivery, and final use or processing of Biosolids in compliance with all applicable legal requirements under federal, state, and local law, including but not limited to those requirements defined in the California Public Resources Code section 40192 and the Federal Code of Regulations 40 CFR, Part 503. 1.3. District's Biosolids. Means Biosolids removed by or generated by the District during the treatment of municipal waste water or domestic sewage at District Plants. 872230.2 Section 2. Nature of Agreement. This Agreement, when fully executed by the Parties, shall constitute a contract whereby Contractor agrees to remove and transport, or accept delivery of Biosolids from District's Reclamation Plant No. 1 and/or Treatment Plant No. 2, in quantities as determined and directed by District. Contractor shall further agree to manage District's Biosolids via land application and/or landfill at established/approved sites or at other mutually agreed upon sites and facilities for the beneficial use of Biosolids. In addition, Contractor agrees to transport, haul, and deliver Biosolids in amounts determined by the District to other sites or facilities as directed by the District. Contractor hereby agrees to provide the services and fulfill the requirements requested in the District's Request for Proposal and Scope of Work, attached hereto as Exhibit "A", and incorporated herein, and Contractor shall provide such services consistent with Contractor's proposal, attached hereto as Exhibit "B", and incorporated herein, or as directed by the District. In addition, Contractor shall also have the capability of hauling and managing District's Biosolids to designated locations as determined by the District and must have excess capacity of a minimum of 750 wet tons per day to manage up to 100% of the District's daily Biosolids production as a failsafe provision. Section 3. Term of Agreement. This Agreement shall be effective as of the date first set forth above and shall continue in full force and effect for a period of five calendar years, beginning January 1, 2013, and ending December 31, 2017, unless the Agreement is: (1) terminated prior to the original expiration date pursuant to the terms of this Agreement; or (2) renewed pursuant to this Section 3, except as subject to early termination as provided in Section 4 of this Agreement. This Agreement may be extended for up to one additional five-year term by mutual consent of both Parties at any time during this Agreement's original term. The Parties may renegotiate the fees or prices set forth in Section 17 as a condition of any such extension. Section 4. Early Termination. 4.1. Grounds for Early Termination. This Agreement may only be terminated at a time prior to the scheduled termination date set forth in Section 3 of this Agreement, and any renewal thereof by written notice of termination as follows: A. By either Party in the event the defaulting Party fails to cure a material breach of this Agreement within thirty (30) days of receipt of a written notice from the non-defaulting Party of such material breach. B. By District upon 90 calendar days written notice to Contractor, where District has determined, in its sole discretion, that the services of Contractor no longer meet, or are necessary to meet, the District's Biosolids Management needs. In the event of termination pursuant to this Section 4, subdivision B, Contractor shall have the opportunity to consult with the District prior to termination and to submit and negotiate reasonable contract termination expenses, if any. Such costs may include, but are not limited to: 872230.2 (i) Costs for services and work performed to the date of termination. (ii) Costs for completing such tasks or work as may be directed by District. (iii) Other costs which are reasonably associated with termination. C. By either Party, in the event of a Force Majeure, if such condition exists for thirty (30) days or more. Either party may terminate this Agreement by giving notice in writing in accordance with Section 33. Said notice shall be effective twenty-four (24) hours after receipt. D. District may, after giving Contractor (and the surety, if any) fifteen (15) days' written notice and to the extent permitted by laws and regulations, terminate the services of Contractor for cause, upon the occurrence of any one or more of the following events: (i) If Contractor fails to perform the work in accordance with the Contract Documents including, but not limited to, failure to provide Biosolids Management services established under the terms of this Agreement, refusal or inability to correct significant non-compliance or management system non-conformance findings, failure to supply sufficient skilled workers, or failure to provide suitable materials or equipment; (ii) If Contractor otherwise violates in any substantial way any provisions of the Agreement; and/or (iii) If Contractor is adjudicated bankrupt, voluntarily files for bankruptcy, or makes any assignment for the benefit of creditors, District may terminate this Agreement by giving the Contractor written notice of termination. The Agreement shall terminate on the date specified in the notice of termination. 4.2. Effect of Early Termination. Where Contractor's services have been so terminated by District, as set forth in this Section 4, the termination will not affect any rights or remedies of District against Contractor then existing or which may thereafter accrue. Any retention or payment of moneys due Contractor by District will not release Contractor from liability. 4.3. Rights Upon Termination. On termination of this Agreement by District for cause, District and Contractor agree as follows: (i) All of the records in Contractor's possession pertaining to the operation of the Project, together with all supplies, equipment, or other items of property owned by District and in Contractor's possession, shall be immediately delivered to District. (ii) Contractor's right to compensation shall immediately cease, except that Contractor is entitled to compensation for services rendered before the termination date. Section 5. Composition of Biosolids. 872230.2 All Biosolids to be removed by Contractor shall be digested wastewater Biosolids that are processed and dewatered by District to an average of 15 or greater percent solids. The District produces Class B Biosolids by anaerobically digesting primary and secondary solids at a temperature of approximately 98°F for greater than 15 days. The District's Biosolids shall meet the non-hazardous material standard according to the California Administration Code's procedures and the U.S. Environmental Protection Agency's (EPA) Toxic Characteristic Leaching Procedures test. In addition, the District's Biosolids shall meet the EPA's alternative Pollutant Limits, as established in 40 Code of Federal Regulations Part 503-Sewage Sludge Regulations (Table 1). The District's Biosolids shall also meet the EPA's Class B Pathogen Reduction and Vector Attraction Reduction Requirements as stated in 40 Code of Federal Regulations Part 503 Sewage Sludge Regulations. Section 6. Ownership of Biosolids. All Biosolids removed from District's premises by Contractor shall become the property of and the responsibility of Contractor at the time Contractor takes possession at District's facilities. In the event the Biosolids are transported by District to the Contractor's sites, or to other mutually agreed upon sites, the Biosolids shall become the property of and responsibility of Contractor at the time Contractor takes possession at its designated location. The District maintains strict oversight of these Biosolids throughout the final use process, up to, but not limited to, post-Iandfilling inspections and crop- harvesting inspections. Section 7. Permitting of Biosolids Management Land Application and Landfill Sites. On execution of this Agreement, Contractor agrees to comply with the following: 7.1 Contractor shall maintain in effect all necessary licenses, permits and other approvals legally required in order to perform this Agreement. 7.2. Contractor shall promptly notify the District of any action or proceeding to cancel, withdraw or modify any license, permit or insurance policy held by Contractor that is related to the District's Biosolids, and of the cancellation, withdrawal, loss or modification of any such license, permit, or policy. 7.3. Contractor shall forward to District copies of all new or revised permits obtained for its existing land application or landfill sites. Prior to commencing operations at such other locations as may be agreed to, Contractor shall forward to District copies of all necessary permits secured in respect to said operations, as defined herein. Contractor shall demonstrate to District upon request that it has obtained and kept current all required business authorizations, including but not limited to Contractor's license and corporate status. Section 8. Scheduled Pickup. Contractor will at all times have a sufficient number of trucks available for removal and management of Biosolids produced by the District in accordance with a 872230.2 prearranged, mutually agreed upon time schedule, location, and in conformance with the Biosolids management system requirements. Section 9. Inclement Weather. Contractor shall provide adequate facilities to insure its ability to manage Biosolids produced by District during inclement weather. Section 10. Biosolids Management Plan. The Contractor shall provide the District with a thorough Biosolids Management Plan (BMP) on the effective date of this Agreement. The BMP shall include, but not be limited to, a complete description of the Contractor's operations, environmental monitoring, and incident response plan. Section 11. Biosolids Contractor Requirements Contractor shall conform to the District's Biosolids Resolutionand Biosolids Contractor Requirements, as set forth in Exhibit "C", attached hereto and incorporated herein, which may be amended from time to time without the need to amend this Agreement. The District shall provide notice to Contractor and a reasonable amount of time for compliance with any amendments to the District's Biosolids Resolution and Biosolids Contractor Requirements. Amendments to Exhibit "C" shall be incorporated herein. Consequences for non-conformance with District requirements include, but are not limited to, truck and driver lockout, reduction in number of scheduled loads, withholding of payment, and grounds for early termination of this Agreement. District's Biosolids Management System includes requirements for Biosolids Contractors. Currently, conformance with District's Biosolids Contractor Requirements includes a commitment to the National Biosolids Partnership's Code of Good Practice and other applicable good practices, procedures for tracking biosolids, reporting and record keeping, regulatory compliance, proactive maintenance, self-imposed requirements, public outreach and documentation, participation in audits and any required corrective actions, corrective and preventive actions for all inspection findings, training and emergency preparedness plans, and other elements that may have procedural and cost implications for Contractors. Pursuant to Section 10, Contractor shall develop and submit a Biosolids Management Plan, which is consistent with the District's Biosolids Contractor Requirements, prior to execution of this Agreement. Section 12. Safety. Contractor's management may be required to attend periodic safety meetings, as directed by District, and Contractor shall be responsible for insuring that all District safe working practices are followed by Contractor's personnel. The District may also require the Contractor to submit safety records. Section 13. Force Maieure. 872230.2 Notwithstanding any other provisions in this Agreement, neither Contractor nor District shall be held responsible or liable for failure to meet their respective obligations under this Agreement, if such failure shall be due to causes beyond the control of the Party that failed to meet its obligations ("Force Majeure"). Such causes shall be limited, however, to the following: civil disorder, insurrection or acts of the public enemy, or acts of a federal or state governmental authority which renders it unlawful to implement this Agreement. A Party shall immediately notify the other Party in writing of such a condition. No Party, however, shall be relieved of any obligation or liability if such failure arises out of such Party's own acts or negligence. Section 14. Records and Reporting. Contractor shall keep complete and correct daily records of all Biosolids Management activities, including, but not limited to, records reflecting the date, quantity, origin and destination of Biosolids removed, transported, land applied, or landfilled. Upon request by the District, Contractor shall provide the District timely access to all such records concerning the management of District's Biosolids, including, but not limited to, application, planting and harvesting dates, crop yields, and the District may conduct additional laboratory testing to verify regulatory compliance. Contractor shall provide the District with a monthly report of activities within 30 days after the end of each month during the term of this Agreement, commencing one (1) month from the effective date of this Agreement. The report of activities shall include, but not be limited to, amount of biosolids hauled and managed, environmental monitoring data, crops planted and harvested, crop yields, if applicable, quantities of residuals applied, problems encountered, communications log and outreach efforts, and approved drivers lists. Contractor shall provide District with an annual report of compliance with 40 CFR Sections 501 and 503 no later than February 12 of the year following the calendar year of the report. Section 15. Compliance with Laws. 15.1 Contractor shall assure that all processes utilized at its existing land application or landfill sites, or other approved sites, specific to this Agreement, shall comply with all applicable local, state and federal laws, rules, regulations and pronouncements including but not limited to the following: A. All activities shall be conducted in accordance with the rules, regulations, orders and other requirements, as applicable, set forth by the U.S. Environmental Protection Agency, Department of Transportation, State of Arizona, State of California, and not limited to, State of California Water Resource Control Board, California Regional Water Quality Control Board, State of California CalRecycle, Air Pollution/Air Quality Control District, County of Orange, Parts 503 of Title 40 of the Code of Federal Regulations ("Standards for the Use and Disposal of Sewage Sludge", respectively), Arizona Article 10 Biosolids Regulations, and such other regulations as may be applicable now or in the future; B. Contractor recognizes that Part 503 of Title 40 of the Code of Federal Regulations is a self-implementing rule and that activities conducted at its existing land application or landfill sites must comply with all applicable general requirements, pollutant limits, management practices, operational standards, monitoring requirements, 872230.2 recordkeeping requirements and reporting requirements of the rule. Contractor shall provide all information relevant to operations at its existing land application or landfill sites, which the District may include in completing NPDES or other permit applications or permit-required reports. 15.2. Contractor shall perform under this Agreement in a safe, competent and compliant manner. 15.3. Contractor shall comply with all applicable federal, state and local laws, statutes, regulations, ordinances, rules, orders, directives, and pronouncements in performing its obligations under this Agreement. 15.4. Without limiting the foregoing, Contractor shall abide by, and shall cause its employees and subcontractors to abide by, all applicable health, safety and EPA and Arizona Department of Environmental Quality rules. 15.5. Contractor shall promptly and fully notify the District of any governmental action or proceeding to enforce any statute, regulation, ordinance, rule, or governmental order in connection with the District's Biosolids covered under this Agreement. 15.6. Contractor shall keep fully informed of federal, state and local laws, ordinances and regulations which in any manner affect those employed by Contractor, or in any way affect the District's Biosolids pursuant to this Agreement. Section 16. Inspections. District shall have access to Contractor's existing sites and other sites specific to this Agreement during normal business hours to conduct inspections of Biosolids Management and related operations. District shall not be required to give advance notice of such inspections to Contractor. Section 17. Compensation. District shall pay Contractor a Base Land Application Fee plus hauling and transportation cost of$54.50 per wet ton. District shall pay Contractor a Base Landfill Tipping Fee plus hauling and transportation cost of$69.00 per wet ton for Biosolids managed on mutually agreed upon landfills. In addition, the District shall pay Contractor$6.00 per wet ton to transport and haul the District's Biosolids to the Orange County Waste and Recycling's Prima Deshecha Landfill located at 32250 La Pata Avenue, San Juan Capistrano, California. The District shall pay the Orange County Waste and Recycling's Base Landfill Tipping Fee as separately negotiated by the District. District shall pay Contractor a mutually agreed upon Base Fee plus hauling and transportation cost for Biosolids managed at other mutually agreed upon sites. Such arrangement shall be in writing, authorized by both parties, without the need to amend this Agreement. 872230.2 Parties have agreed to a fuel surcharge rate calculation as referenced in Exhibit "B", attached hereto and incorporated herein, and have agreed that no Consumer Price Index (CPI) adjustment is applicable to this Contract. Fuel Surcharge Rate = A (X-Y) A=Distance Multiplier 1) Kern County =3.0 and 2) Yuma County, AZ = 4.8. Where Distance multiplier is a factor of approximate total miles (round trip), truck fuel efficiency (assumes 5.5 m/g to Kern and 6.5 m/g to AZ), and an average of 25 tons per truck load. X = Monthly average fuel Price per gallon Y = Monthly average fuel price at the date Contract is executed The total annual cumulative amount paid for all of the District's Biosolids Management, inclusive of the services under this Agreementshall not exceed $19,000,000 or the total annual biosolids management budget per year without the District's express written approval. Contractor shall produce all books, records, invoices and receipts demonstrating the actual costs of regulatory fees. The Base Land Application Fee or Base Landfill Tipping Fee may be subject to adjustment for cost fluctuations based on the sole discretion of the District if it is determined that an increase in the payment for Biosolids Management is necessary in order to compensate the Contractor for reasonable costs incurred in excess of those contemplated at the time this Agreement is executed. Consumer Price Index adjustment does not apply in this contract. Rate increases shall be limited to those documented to be necessary to meet the Contractor's increased expenses. Contractor agrees to provide the District with written documentation supporting its request for any increase in the per ton cost to the District. All Contractor invoices shall be paid within thirty (30) days of receipt by District. Contractor shall keep proper books of record and accounts of all revenues to be shared with District which shall contain complete and correct entries of all deliveries of Biosolids. Said books and records shall, upon written request, be made available for inspection by a duly authorized representative of District. Section 18. Payment and Invoicing. District shall pay Contractor bi-weekly for services rendered pursuant to this Agreement upon receipt of an itemized invoice, in a form acceptable to the District to enable audit of the charges thereon. Contractor shall e-mail the invoices to the District to the address provided in Section 34, to the attention of"Accounts Payable." Section 19. Insurance to be Maintained by Contractor. Contractor and all subcontractors shall purchase and maintain, throughout the term of this Agreement and any periods of warranty or extensions, insurance in amounts 872230.2 equal to the requirements set forth in the signed Acknowledgement of Insurance Requirements (attached hereto and incorporated herein as Exhibit "D"). Contractor shall not commence work under this Agreement until all required insurance is obtained in a form acceptable to the District, nor shall Contractor allow any subcontractor to commence service pursuant to a subcontract until all insurance required of the subcontractor has been obtained and submitted to the District. Failure to maintain required insurance coverage shall result in termination of this Agreement. Section 20. Default and Remedies. 20.1. Allegation of Default. In the event either Party violates any of the terms or conditions of this Agreement or fails, in the opinion of the other Party, to satisfactorily perform its duties under this Agreement, the aggrieved Party shall deliver an Allegation of Default to the violating Party. The Allegation of Default shall be delivered in the manner described in Section 33 of this Agreement. After delivery of the Allegation of Default, the violating Party shall have thirty (30) days within which to cure the alleged default or to otherwise respond to the Allegations of Default. 20.2. Event of Default. In the event that either Party to this Agreement shall fail to comply, in any material respect, with any of its obligations, covenants or responsibilities under this Agreement within 30 days after an Allegation of Default has been issued, this shall constitute an Event of Default, and the non-defaulting party shall be entitled to the remedies set forth below in Section 20.3. 20.3. Remedies for Default. In the event of an uncured event of default of any material provision of this Agreement, a Party shall be permitted to pursue any remedy available to it at law or equity; provided, however, that a Party shall have the right to terminate this Agreement only in accordance with the provisions of Section 4 hereof. The pursuit of any right or remedy by a party shall not be exclusive of its right to pursue any other remedies available to it. Neither Party shall have any right of set-off against any amounts owed under this Agreement for damages claimed under this Agreement. Section 21. District CEQA Compliance. The District's obligations under this Agreement shall become effective upon the successful completion of District's review of the proposed activities pursuant to the California Environmental Quality Act, Public Resources Code section 21000, et seq. (CEQA). District shall have no obligations under this Agreement, and the Agreement shall have no force and effect, unless and until the District determines, in its sole and absolute discretion, that District has completed all CEQA review, made appropriate findings under CEQA as required by law, and finally determined to proceed with the activities described in this Agreement. Section 22. Indemnification. Except as to the negligence or willful misconduct of the District, Contractor shall indemnify, defend (at Contractor's sole cost and expense and with legal counsel approved by the District, which approval shall not be unreasonably withheld), protect and hold harmless the District and all of District's officers, directors, employees, consultants, and agents (collectively the "Indemnified Parties"), (a)from and against any claim, expense, loss, liability, cost, including without limitation, attorney's fees, expert fees, or 872230.2 consultant fees caused by, resulting from or arising out of the failure of the Contractor, its employees, subcontractors, representatives and products, to comply fully with applicable federal, state, or local laws, statutes, regulations, ordinances, rules, or governmental directives which regulate the acceptance, handling, storage, processing or management of the District's Biosolids; (b) from all claims, suits and liability for loss or damage to any tangible property or persons, including death, caused by any negligent or willful act of the Contractor, its employees, representatives, subcontractors, or representatives during the preparation, delivery, acceptance, handling, collection, storage or management of the District's Biosolids; and (c) from all claims, suits and liability for personal and environmental injury or harm that results from the preparation, acceptance, handling, collection, handling, storage or management of the District's Biosolids created by the acts or omissions of the Contractor. Contractor's indemnification obligation hereunder shall survive the expiration or earlier termination of this Agreement until such time as action against the Indemnified Parties for such matter indemnified hereunder is fully and finally barred by the applicable statute of limitations. Section 23. Duty To Defend. The duty to defend hereunder is wholly independent of and separate from the duty to indemnify and such duty to defend shall exist regardless of any ultimate liability of Contractor. Contractor's obligation to defend shall arise immediately upon presentation of a Claim by any person if, without regard to the merit of the Claim, such Claim could potentially result in an obligation to indemnify one or more Indemnified Parties, and upon written notice of such Claim being provided to Contractor. Payment to Contractor by any Indemnified Party or the payment or advance of defense costs by any Indemnified Party shall not be a condition precedent to enforcing such Indemnified Party's rights to indemnification hereunder. In the event a final judgment, arbitration, award, order, settlement, or other final resolution expressly determines that the claim did not arise out of, pertain to, or relate to the negligence, recklessness, or willful misconduct of the Contractor, to any extent, then the District will reimburse Contractor for the reasonable costs of defending the Indemnified Parties against such Claims. Section 24. Attorneys' Fees. In the event that legal action is commenced by either of the Parties hereto in connection with this Agreement, the Party prevailing in any such action shall be entitled to recover from the other Party or Parties, in addition to such other relief as the Court may grant, all reasonable attorneys' fees and costs incurred by the prevailing Party. Section 25. Contractor's Status. It is understood and agreed that the Contractor is, and shall be, acting at all times as an independent contractor herein, and not as an employee of District. Contractor shall secure, at its own expense, and be responsible for, any and all payment of applicable taxes including Social Security (FICA), State Disability Insurance Compensation, Unemployment Compensation, employee payroll taxes, and any other payroll deduction for Contractor and its officers, agents, and employees in connection with the services to be performed under this Agreement. The relationship between the Parties shall be limited to performance of this Agreement in accordance with its terms. Unless otherwise specifically stated herein, neither Party shall have any responsibility with respect to the services to be provided or contractual benefits assumed by the other 872230.2 Party. Nothing in this Agreement shall be deemed to constitute either Party a partner, agent or legal representative of the other Party. No liability or benefits, such as workers compensation, pension rights or liabilities, or other provisions or liabilities arising out of or related to a contract for hire or employer/employee relationship, shall arise or accrue to any Party's agent or employee as a result of this Agreement or the performance thereto. Section 26. Successors and Assigns. The terms and conditions of this Agreement shall inure to the benefit of and be binding upon the Parties hereto and their respective heirs, representatives, successors, and assigns. No assignment of this Agreement shall be effective without the prior written consent of the non-assigning Party. Section 27. Further Assurances. Whenever requested by the other Party, each Party shall execute, acknowledge, and deliver all further conveyances, agreements, confirmations, satisfactions, releases, powers of attorney, instruments of further assurance, approvals, consents, and all further instruments and documents as may be necessary, expedient, or proper to complete any conveyances, transfers, sales, and agreements covered by this Agreement, and to do all other acts and to execute, acknowledge, and deliver all requested documents to carry out the intent and purpose of this Agreement. Section 28. Third-Party Rights. Nothing in this Agreement, express or implied, is intended to confer on any person, other than the Parties to this Agreement and their respective successors and assigns, any rights or remedies under or by reason of this Agreement. Section 29. Entire Agreement; Modifications in Writing. All previous negotiations had between the Parties hereto and/or their agents with respect to this Agreement are merged herein and this Agreement alone fully and completely expresses the Parties' rights and obligations. This Agreement shall not be modified in any manner except by an instrument in writing executed by the Parties or their respective successors in interest. Section 30. Severability. Should it be found that any part of this Agreement is unlawful or unenforceable, such part or parts of this Agreement shall be of no force or effect, and this Agreement shall be treated as if such part or parts had not been inserted. Section 31. Interpretation. Each of the Parties hereby waives any provisions of law to the effect that an ambiguity in a contract or agreement should be interpreted against the Party that drafted the contract, agreement, or instrument. 872230.2 Section 32. Governing Law. This Agreement shall be governed by and construed according to the laws of the State of California. Section 33. Notice. Any notice, payment, or instrument required or permitted to be given hereunder shall be deemed received upon personal delivery, email delivery or upon deposit in the United States mail, registered or certified, postage prepaid and addressed to the Party for whom intended as follows: If to Contractor: If to District: Orange County Sanitation District 10844 Ellis Avenue Fountain Valley, California 92708 Attention: Contracts Manager mdubois@ocsd.com With a copy to: Bradley R. Hogin General Counsel — OCSD Woodruff, Spradlin & Smart 555 Anton Boulevard, Suite 1200 Costa Mesa, California 92626 bhogin@wss-law.com 872230.2 Section 34. Authority. The individuals executing this Agreement and the instruments referenced herein on behalf of the Parties each represent and warrant that they have the legal power, right and actual authority to bind the Parties to the terms and conditions hereof and thereof. Section 35. Waivers. No waivers or failure to exercise any right, option or privilege under the terms of this Agreement on any occasion shall be construed to be a waiver of any other right, option or privilege on any other occasion. IN WITNESS WHEREOF, the Parties hereto have executed this Agreement the day and year first above written. "DISTRICT" ORANGE COUNTY SANITATION DISTRICT By Chair, Board of Directors By Clerk of the Board By Contracts/Purchasing Manager APPROVED AS TO FORM: Bradley R. Hogin General Counsel By "CONTRACTOR" By Its President or authorized designee 872230.2