HomeMy WebLinkAbout09-26-2012 Board Meeting Agenda September 20, 2012
NOTICE OF
REGULAR MEETING
BOARD OF DIRECTORS
ORANGE COUNTY SANITATION DISTRICT
Wednesday, September 26, 2012 — 6:30 P.M.
Administration Building
10844 Ellis Avenue
Fountain Valley, California 92708
The Regular Meeting of the Board of Directors of the Orange County Sanitation
District will be held at the above location, time and date.
Clerk of the Board
Board Strategic Plan Workshop - Wednesday, October 17, 2012 at 5:00 p.m.
Steering Committee - Wednesday, October 24, 2012 at 5:00 p.m.
Board Meeting - Wednesday, October 24, 2012 at 6:30 p.m.
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BOARD MEETING DATES
September 26, 2012
October 24, 2012
November 28, 2012
*December 19, 2012
January 23, 2013
February 27, 2013
March 27, 2013
April 24, 2013
May 22, 2013
June 26, 2013
July 24, 2013
August 28, 2013
*Meetings are being held on the third Wednesday of the month
Wednesday, September 26, 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: (Don Schweitzer, City of Brea)
DECLARATION OF QUORUM:
ROLL CALL:
1. Receive and file Minute Excerpt from City of Fullerton relating to the appointment
of Gregory Sebourn to the Orange County Sanitation District Board.
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.
CLAIMS:
2. Ratify payment of claims of the District, by roll call vote, as follows:
Claims Paid for the Period Ending: 08/15/12 08/31/12
Totals $10,338,191.04 $8,252,787.83
DIRECTORS: Pursuant to Government Code Secdtion 84308, you are required to disclose any
campaign contribution greater than $250 received in the past twelve months from any party seeking a
contract with 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.
09/24/12 OCSD Board of Directors'Agenda Page 1 of 6
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.
3. Approve minutes for the Regular Board Meeting held on August 22, 2012.
4. A. Adopt Fair Political Practices Commission ("FPPC") Form 806, which
contains information regarding public official appointments; and
B. Direct the Clerk of the Board to post FPPC Form 806 on the Orange
County Sanitation District's website.
5. A. Approve Plans and Specifications for Digester Ferric Chloride System
Rehabilitation, Project No. P2-105 Rebid, on file at the office of the Clerk
of the Board;
B. Approve Addendum Nos. 1 and 2 to the plans and specifications;
C. Receive and file bid tabulation and recommendation;
D. Receive and file Award Protest dated September 13, 2012 from
Environmental Construction, Inc. concerning the award to ODC
Engineering and Technology;
E. Receive and file letter dated September 19, 2012 to Environmental
Construction, Inc. responding to the Award Protest;
F. Reject Award Protest filed by Environmental Construction, Inc.;
G. Award a construction contract to ODC Engineering and Technology for
Digester Ferric Chloride System Rehabilitation, Project No. P2-105 Rebid,
for a total amount not to exceed $1,694,000; and,
H. Approve a contingency of $169,400 (10%).
6. Grant a Non-Exclusive Temporary Construction Easement to Orange County
Flood Control District for the Newland Storm Channel Rehabilitation Project from
the final execution date to the earliest occurrence of either the Notice of
Completion filing or until July 31, 2015, in a form approved by General Counsel.
09/24/12 OCSD Board of Directors'Agenda Page 2 of 6
7. A. Adopt Resolution No. OCSD 12-12, authorizing the execution and delivery
by the District of an Installment Purchase Agreement, a Trust Agreement
and a Continuing Disclosure Agreement in connection with the execution
and delivery of Orange County Sanitation District Revenue Refunding
Certificate Anticipation Notes, Series 2012C, such Notes evidencing
principal in an aggregate amount of not to exceed $145,000,000,
approving a Notice of Intention to Sell, authorizing the distribution of an
Official Notice Inviting Bids and an Official Statement in connection with
the offering and sale of such Notes and authorizing the execution of other
necessary documents and related actions; and,
B. That the Orange County Sanitation District Financing Corporation approve
the documents supporting and authorizing the Notes in an aggregate
amount not to exceed $145,000,000.
STEERING COMMITTEE:
8. Approve minutes of the August 22, 2012, Steering Committee Meeting.
9. Approve the General Manager's FY 2012-13 Work Plan and Report of
Accomplishments.
OPERATIONS COMMITTEE:
10. Approve minutes for the Operations Committee Meeting held on September 5,
2012.
11. Approve a Non-Exclusive Access Agreement, in a form approved by General
Counsel, with the Newport Beach Veterinary Hospital to access a portion of the
Sanitation District's property.
12. A. Approve Amendment No.1 to the Agreement with Hill Brothers Chemical
Company, for Regional Odor and Corrosion Control Services,
Specification No. C-2012-524BD, to include emergency and backup
services options, for calcium nitrate, unit price $3.35 per gallon plus tax,
$100 freight per delivery, and service fee $1,500 per station per day
operating (maximum 48 hours); for magnesium hydroxide at a unit price
$580 per dry ton plus tax, $385 freight per delivery, and service fee $1,500
per station per day operating (maximum 48 hours); for the period July 1,
2012 through June 30, 2013 with four one-year renewal options; and
09/24/12 OCSD Board of Directors'Agenda Page 3 of 6
B. Approve Amendment No.1 to the Agreement with Hill Brothers Chemical
Company, for Regional Odor and Corrosion Control Services,
Specification No. C-2012-524BD, to include a $100 per hour demurrage
fee for mobile dosing upon request for magnesium hydroxide at a unit
price $580 per dry ton plus tax, $385 freight per delivery (maximum 48
hours); for the period July 1, 2012 through June 30, 2013 with four one-
year renewal options.
ADMINISTRATION COMMITTEE:
13. Approve minutes for the Administration Committee Meeting held on September
12, 2012.
14. Receive and file report of reimbursements to Board Members and Staff per
Government Code 53065.5 for the period of July 1, 2011, through June 30, 2012.
15. Authorize the General Manager to issue Revenue Refunding Certificate
Anticipation Notes, Series 2012C, as one-year fixed-rate obligations, in an
amount not to exceed $145.0 million to replace the $143.205 million Revenue
Refunding Certificate Anticipation Notes, Series 2011 B maturing on November 9,
2012.
ORANGE COUNTY SANITATION DISTRICT FINANCING CORPORATION
The members of the Orange County Sanitation District Board of Directors are each being compensated
$212.50 for the Board Meeting; there is no additional compensation for the Financing Corporation
Meeting.
CALL TO ORDER:
Board of Directors, Orange County Sanitation District Financing Corporation.
ROLL CALL:
APPROVAL OF MINUTES:
If no corrections or amendments are made, the minutes for the meeting held on July 25,
2012, will be deemed approved and be so ordered by the Chair.
09/24/12 OCSD Board of Directors'Agenda Page 4 of 6
ACTION ITEM:
Adopt Resolution No. FC-19, A resolution of the Board of Directors of the Orange
County Sanitation District Financing Corporation Authorizing the Execution and Delivery
of an Installment Purchase Agreement and a Trust Agreement in Connection with the
Execution and Delivery of Orange County Sanitation District Revenue Refunding
Certificate Anticipation Notes, Series 2012C, Authorizing the Execution and Delivery of
such Notes Evidencing Principal in an Aggregate Amont of not to Exceed $145,000,000
and Authorizing the Exeuction of Other Necessary Documents and Related Actions.
(See Agenda Report for Item No. 7)
Adjourn, Board of Directors, Orange County Sanitation District Financing Corporation.
* * * * * * * * * * * * * * * * * *
Reconvene, Board of Directors, Orange County Sanitation District
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
(Section 54956.9(a))
Two Cases:
( Mladen Buntich Construction Company v. Orange County
Sanitation District; OCSD v. Buntich Cross-Claim, Orange County
Superior Court Case No. 00491934
( Orange County Sanitation District v. Liberty Mutual, et al., U.S.
District Court, Central District of California, Case No. SACV 12-854-
JVS (AJWx)
09/24/12 OCSD Board of Directors'Agenda Page 5 of 6
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:
ADJOURNMENT:
Adjourn the Board meeting until the next regular Meeting on October 24, 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(a)ocsd.com
For any questions on the agenda, Committee members may contact staff at:
General Manager Jim Ruth (714)593-7110 Iruth(@ocsd.com
Assistant General Manager Bob Ghirelli (714)593-7400 rghirelliO)ocsd.com
Assistant General Manager Jim Herberg (714)593-7300 iherberg a(�ocsd.com
Director of Facility Support Services Nick Arhontes (714)593-7210 narhontes(o-)ocsd.com
Director of Finance and Lorenzo Tyner (714)593-7550 Itvner(cDocsd.com
Administrative Services
Director of Human Resources Jeff Reed (714)593-7144 Ireed(cDocsd.com
Director of Operations&Maintenance Ed Torres 714 593-7080 etorres@ocsd.com
09/24/12 OCSD Board of Directors'Agenda Page 6 of 6
Glossary of Terms and Abbreviations
AQMD Air Quality Management District
ASCE American Society of Civil Engineers
BOD Biochemical Oxygen Demand
CARB California Air Resources Board
CASA California Association of Sanitation Agencies
CCTV Closed Circuit Television
CRWQCB California Regional Water Quality Control Board
CWA Clean Water Act
CWEA California Water Environment Association
EIR Environmental Impact Report
EMT Executive Management Team
EPA U.S. Environmental Protection Agency
FOG Fats, Oils, and Grease
FSSD Facilities Support Services Department
gpd Gallons per day
GWR System Groundwater Replenishment System (also called GWRS)
LOS Level of Service
MGD Million gallons per day
NACWA National Association of Clean Water Agencies
NPDES National Pollutant Discharge Elimination System
O&M Operations and Maintenance
OCHCA Orange County Health Care Agency
OCSD Orange County Sanitation District
OCWD Orange County Water District
OOBS Ocean Outfall Booster Station
OSHA Occupational Safety and Health Administration
POTW Publicly Owned Treatment Works
ppm Parts per million
RWQCB Regional Water Quality Control Board
SARI Santa Ana River Inceptor
SARWQCB Santa Ana Regional Water Quality Control Board
SAWPA Santa Ana Watershed Project Authority
SCADA Supervisory Control and Data Acquisition system
SCAP Southern California Alliance of Publicly Owned Treatment Works
SCAQMD South Coast Air Quality Management District
Glossary of Terms and Abbreviations
SOCWA South Orange County Wastewater Authority
SSMP Sanitary Sewer Management Plan
SSO Sanitary Sewer Overflow
SWRCB State Water Resources Control Board
TDS Total Dissolved Solids
TMDL Total Maximum Daily Load
TSS Total Suspended Solids
WDR Waste Discharge Requirements
WEF Water Environment Federation
WERF Water Environment Research Foundation
Activated-sludge process — A secondary biological wastewater treatment process where bacteria
reproduce at a high rate with the introduction of excess air or oxygen, and consume dissolved
nutrients in the wastewater.
Biochemical Oxygen Demand (BOD) —The amount of oxygen used when organic matter undergoes
decomposition by microorganisms. Testing for BOD is done to assess the amount of organic matter in
water.
Biosolids — Biosolids are nutrient rich organic and highly treated solid materials produced by the
wastewater treatment process. This high-quality product can be recycled as a soil amendment on
farm land or further processed as an earth-like product for commercial and home gardens to improve
and maintain fertile soil and stimulate plant growth.
Capital Improvement Program (CIP) — Projects for repair, rehabilitation, and replacement of assets.
Also includes treatment improvements, additional capacity, and projects for the support facilities.
Coliform bacteria —A group of bacteria found in the intestines of humans and other animals, but also
occasionally found elsewhere used as indicators of sewage pollution. E. coli are the most common
bacteria in wastewater.
Collections system — In wastewater, it is the system of typically underground pipes that receive and
convey sanitary wastewater or storm water.
Certificate of Participation (COP) — A type of financing where an investor purchases a share of the
lease revenues of a program rather than the bond being secured by those revenues.
Contaminants of Potential Concern (CPC) — Pharmaceuticals, hormones, and other organic
wastewater contaminants.
Dilution to Threshold (D/T) — the dilution at which the majority of the people detect the odor
becomes the D/T for that air sample.
Greenhouse gases — In the order of relative abundance water vapor, carbon dioxide, methane,
nitrous oxide, and ozone gases that are considered the cause of global warming ("greenhouse
effect").
Glossary of Terms and Abbreviations
Groundwater Replenishment (GWR) System — A joint water reclamation project that proactively
responds to Southern California's current and future water needs. This joint project between the
Orange County Water District and the Orange County Sanitation District provides 70 million gallons a
day of drinking quality water to replenish the local groundwater supply.
Levels of Service (LOS) — Goals to support environmental and public expectations for performance.
NDMA — N-Nitrosodimethylamine is an N-nitrosoamine suspected cancer-causing agent. It has been
found in the Groundwater Replenishment System process and is eliminated using hydrogen peroxide
with extra ultra-violet treatment.
National Biosolids Partnership (NBP) — An alliance of the National Association of Clean Water
Agencies (NACWA) and Water Environment Federation (WEF), with advisory support from the U.S.
Environmental Protection Agency (EPA). NBP is committed to developing and advancing
environmentally sound and sustainable biosolids management practices that go beyond regulatory
compliance and promote public participation in order to enhance the credibility of local agency
biosolids programs and improved communications that lead to public acceptance.
Publicly-owned Treatment Works (POTW) — Municipal wastewater treatment plant.
Santa Ana River Interceptor (SARI) Line — A regional brine line designed to convey 30 million
gallons per day (MGD) of non-reclaimable wastewater from the upper Santa Ana River basin to the
ocean for disposal, after treatment.
Sanitary sewer — Separate sewer systems specifically for the carrying of domestic and industrial
wastewater. Combined sewers carry both wastewater and urban run-off.
South Coast Air Quality Management District (SCAQMD) — Regional regulatory agency that
develops plans and regulations designed to achieve public health standards by reducing emissions
from business and industry.
Secondary treatment — Biological wastewater treatment, particularly the activated-sludge process,
where bacteria and other microorganisms consume dissolved nutrients in wastewater.
Sludge — Untreated solid material created by the treatment of wastewater.
Total suspended solids (TSS) —The amount of solids floating and in suspension in wastewater.
Trickling filter — A biological secondary treatment process in which bacteria and other
microorganisms, growing as slime on the surface of rocks or plastic media, consume nutrients in
wastewater as it trickles over them.
Urban runoff — Water from city streets and domestic properties that carry pollutants into the storm
drains, rivers, lakes, and oceans.
Wastewater—Any water that enters the sanitary sewer.
Watershed — A land area from which water drains to a particular water body. OCSD's service area is
in the Santa Ana River Watershed.
Return to Agenda
•
Office of the City Clerk
ACTION OF THE CITY COUNCIL/SUCCESSOR AGENCY/PUBLIC FINANCING
AUTHORITY
CITY OF FULLERTON
August 7, 2012
A Regular Meeting of the City Council/Successor Agency/Public Financing Authority of the City of
Fullerton, California, was held on Tuesday, August 7, 2012.
Council/Agency Members Present: Quirk-Silva, Whitaker, Chaffee, Kiger, Sebourn
Council/Agency Members Absent: None
CITY REPRESENTATION — REGIONAL ADVISORY BODIES
It was moved and seconded to:
Appoint Council Member Sebourn to serve as the City Council
representative on the Orange County Sanitation District.
Motion carried 4-0-1, Sebourn abstained.
STATE OF CALIFORNIA )
COUNTY OF ORANGE ) SS
CITY OF FULLERTON )
I, Mea Klein, Assistant City Clerk of the City of Fullerton, California, do hereby certify the foregoing to be
an official action taken by the City Council/Successor Agency/Public Financing Authority at the above
meeting.
IN WITNESS WHEREOF, I have hereunto set my hand and seal this 6th day of September, 2012.
\ '
Mea Klein, ssistant City Clerk
*r�� FnUf'a,*i��r �nn�tn��.ir.ifP
303 West Commonwealth Avenue,Fullerton,California 92832-1775
(714) 738-6350 • Fax (714) 525-8071 • Web Site:www.ci.fullerton.ca.us
Return to Agenda
BOARD OF DIRECTORS Meeting Date To Bd. of Dir.
09/26/12
AGENDA REPORT Item Number Item Number
2
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 8/01/12 — 8/15/12 and 8/16/12 — 8/31/12
Page 1 of 1
Claims Paid From 8/01/12 to 8/15/12
Vendor Warrant No. Amount Description
Accounts Payable Warrants
A W Chesterton 50124 $ 3,243.48 Repair&Maintenance Services and/or Supplies
A-Check America,Inc. 50014 1,030.60 Human Resources Services
A-Check America,Inc. 50125 193.50 Human Resources Services
Aerotek 50015 5,771.52 Professional Services/Temporary Services
Aerotek 50126 3,736.80 Professional Services/Temporary Services
Agilent Technologies,Inc. 50016 1,734.91 Laboratory Services&Supplies
Agilent Technologies,Inc. 50127 2,336.78 Laboratory Services&Supplies
Ago IndustriesDBA So-Cal Sweeping 50225 980.00 Street Sweeping Services
Air Liquide America Specialty Gases LLC 50279 183.78 Laboratory Services&Supplies
Air Toxics,LTD 50280 675.00 Laboratory Services&Supplies
Airgas Safety,Inc. 50128 3,103.13 Safety,Security,Health Equipment,Supplies,and Services
Airgas USA,LLC 50017 272.50 Laboratory Services&Supplies
Airgas USA,LLC 50129 665.86 Laboratory Services&Supplies
Airgas West 50018 1,306.68 Repair&Maintenance Services and/or Supplies
Alhambra Foundry Co.,Ltd. 50019 4,706.52 Repair&Maintenance Services and/or Supplies
Alhambra Foundry Co.,Ltd. 50113 29,336.02 Repair&Maintenance Services and/or Supplies
All American Sewer Tools 50130 307.57 Repair&Maintenance Services and/or Supplies
Alliant Insurance Services 50131 755.99 Insurance
Allied Electronics,Inc. 50132 685.96 Electrical/Electronic Equipment,Parts&Repairs
Allied Packing&Rubber, Inc. 50133 164.77 Repair&Maintenance Services and/or Supplies
Aloma Shim And Manufacturing Co 50020 52.06 Repair&Maintenance Services and/or Supplies
American Chemical Society 50134 148.00 Professional Organizations Meeting/Training/Membership
American Concrete Institute 50281 93.00 Books and Publications
American Express 50262 46,626.16 Purchasing Card Program for Miscellaneous Parts and Supplies
American Express TVL Related Svcs Co.,Inc. 50282 4,033.80 Purchasing Card Program for Miscellaneous Travel Expenses
Amtech Elevator Services 50135 1,035.00 Miscellaneous Services
Analysts, Inc. 50136 281.01 Repair&Maintenance Services and/or Supplies
AppleOne Employment Service 50021 1,900.00 Professional Services/Temporary Services
AppleOne Employment Service 50137 4,000.00 Professional Services/Temporary Services
Applied Industrial Technology 50138 1,878.56 Repair&Maintenance Services and/or Supplies
Archie Ivy, Inc. 50022 4,985.00 Repair&Maintenance Services and/or Supplies
Argus-Hazco 50023 3,965.20 Repair&Maintenance Services and/or Supplies
Arizona Instruments,L.L.C. 50024 6,873.08 Electrical/Electronic Equipment,Parts&Repairs
ARS Enterprises, Inc. 50025 400.00 Laboratory Services&Supplies
Association of California Cities 50026 166.76 Professional Organizations,Meeting/Training/Membership Dues
AT&T Universal Biller 50027 2,448.57 Telecommunications
AT&T Universal Biller 50283 122.27 Telecommunications
AT&T 50139 32.18 Telecommunications
ATM AA, Inc. 50140 560.00 Lab Services
Awards&Trophies Company 50284 55.15 Awards and Framing Services
AWSI 50141 188.00 Professional Services-DOT Program Administration
AWWA 50285 238.00 Professional Organizations Meeting/Training/Membership
Barragan Corp. International 50286 542.50 Professional Organizations Meeting/Training/Membership
Basler Electric Company,dept 590 remit 50287 2,084.36 Electrical Parts&Supplies
Battery Specialties 50288 10,700.54 Batteries,Various
Battery Systems, Inc. 50142 73.51 Repair&Maintenance Services and/or Supplies
Battery Systems, Inc. 50289 170.59 Repair&Maintenance Services and/or Supplies
BC Wire Rope&Rigging 50290 1,293.00 Tools&Supplies
EXHIBIT A
fin/210/mm Page 1 of 10 8/21/2012
Claims Paid From 8/01/12 to 8/15/12
Vendor Warrant No. Amount Description
Beach Wire and Cable 50143 96.91 Telecommunications
BHI Management Consulting 50028 3,734.25 Professional Services/Strategic Planning
BioMerieux Vitek,Inc. 50291 1,834.06 Laboratory Services&Supplies
Black&Veatch Corporation 50029 11,241.46 Professional Services/Engineering Design Services
Black&Veatch Corporation 50263 116,572.68 Professional Services/Engineering Design Services
Brown&Caldwell 50264 49,042.43 Professional Services/Engineering Design Services
Bureau Veritas North America,Inc. 50292 1,257.70 Industrial Hygiene Services
California Barricade Rentals 50146 7,470.00 Miscellaneous Services
California Dept.of Child Support 50147 1,984.24 Judgments Payable
California Recreation Company 50148 3,377.78 Boat Slip Rental-Nerissa Ocean Monitoring Vessel
California Relocation Services,Inc. 50030 150.00 Miscellaneous Services-Moving/Relocation
Caltrol,Inc. 50149 2,222.18 Electrical/Electronic Equipment,Parts&Repairs
Cambridge Isotope Labs 50293 765.03 Laboratory Services&Supplies
City of Fountain Valley 50050 396.03 Water Use
City of Fountain Valley 50323 397.73 Water Use
City of Fullerton 50052 44.69 Water Use
City of Garden Grove 50294 10.00 Water Use
City of Huntington Beach 50188 13,078.61 Water Use
City of Huntington Beach 50337 11.82 Water Use
CMAA 50150 110.00 Professional Organizations Meeting/Training/Membership
CMAA 50295 250.00 Professional Organizations Meeting/Training/Membership
Cole-Parmer Instrument Co. 50031 841.78 Laboratory Services&Supplies
Cole-Parmer Instrument Co. 50151 11.86 Laboratory Services&Supplies
Columbia Analytical Services 50296 2,950.00 Laboratory Services&Supplies
Computer Protection Technology, Inc. 50032 920.00 Electrical/Electronic Equipment,Parts&Repairs
Connell Chevrolet\GEO 50152 707.25 Autos,Trucks&Marine Equipment,Parts,Accessories&Services
Consumers Pipe&Supply Co. 50153 145.67 Repair&Maintenance Services and/or Supplies
Consumers Pipe&Supply Co. 50297 410.31 Repair&Maintenance Services and/or Supplies
Control Factors Seattle, Inc. 50298 1,116.35 Repair&Maintenance Services and/or Supplies
Converse Consultants 50299 1,249.00 Professional Services/Professional Services/Materials&Geotechnical Testing
Cooperative Personnel Services 50035 540.50 Human Resources Services
Corporate Image Maintenance,Inc. 50265 36,215.00 Janitor&Household Service&Supplies
CORRPRO Companies, Inc. 50001 49,609.00 Professional Services/Temporary Services
County of Orange 50261 200.00 Governmental Agency Fees&Charges
County of Orange-Health Care Agency 50154 22,505.50 Governmental Agency Fees&Charges
County of Orange Auditor Controller 50033 840.00 Governmental Agency Fees&Charges
County of Orange Auditor Controller 50034 1,545.00 Governmental Agency Fees&Charges
County of Orange Auditor Controller 50300 810.00 Governmental Agency Fees&Charges
County of Riverside 50301 99.00 Notice of Exemption Filing Fee-FE05-46
County Wholesale Electric Co. 50302 96.26 Electrical/Electronic Equipment,Parts&Repairs
Court Order 50196 2,179.38 Judgments Payable
Court Order 50199 150.00 Judgments Payable
Court Order 50215 108.00 Judgments Payable
Court Order 50253 912.50 Judgments Payable
CR&R, Inc. 50303 1,010.34 Waste Disposal
CS-AMSCO 50036 1,396.06 Repair&Maintenance Services and/or Supplies
CS-AMSCO 50304 16,283.26 Repair&Maintenance Services and/or Supplies
CSMFO 50145 275.00 Professional Organizations Meeting/Training/Membership
CSUF Auxiliary Services Corporation 50155 19,621.75 Professional Organizations Meeting/Training/Membership(Demographics)
EXHIBIT A
fin/210/mm Page 2 of 10 8/21/2012
Claims Paid From 8/01/12 to 8/15/12
Vendor Warrant No. Amount Description
Culligan of Orange County 50037 57.55 Repair&Maintenance Services and/or Supplies
Culligan of Orange County 50156 60.40 Repair&Maintenance Services and/or Supplies
CWEA Membership 50038 660.00 Professional Organizations Meeting/Training/Membership
CWEA Membership 50305 132.00 Professional Organizations Meeting/Training/Membership
CWEA Specialty Conference 50306 288.00 Professional Organizations Meeting/Training/Membership
DAC(Digital Assurance Certification) 50157 1,500.00 Professional Services/Financial Document Repository
Danchuk LLC 50307 1,451.17 Sewer User Refund
Dang,Chi Thanh 50039 190.79 Sewer User Refund
Dapper Tire Co. 50308 9,062.42 Autos,Trucks&Marine Equipment,Parts,Accessories&Services
David P.Halverson 50112 976.18 Meeting/Training Expense Reimbursement
David Wheeler Pest Control, Inc. 50040 3,970.00 Pest Control Services
Deborah L.Lindel 50258 100.00 Meeting/Training Expense Reimbursement
Delta Q,Inc. 50158 3,370.08 Repair&Maintenance Services and/or Supplies
Department of Transportation 50114 28,500.00 Miscellaneous Services
Desert Pumps&Parts, Inc. 50159 655.86 Repair&Maintenance Services and/or Supplies
Detection Instruments Corporation 50041 2,612.44 Electrical/Electronic Equipment,Parts&Repairs
Dig-Smart,L.L.C. 50310 9,792.00 Computer Applications&Services
DKS Associates 50160 14,649.40 Professional Services/Traffic Study
DLT&V Systems Engineering, Inc. 50309 435.00 Computer Applications&Services
Don Grayson,Ph.D.,Consulting 50161 991.37 Professional Management Consulting Services
Dunn-Edwards Corporation 50042 54.83 Facilities,Maintenance,Services&Supplies
Dunn-Edwards Corporation 50311 209.48 Facilities,Maintenance,Services&Supplies
Electrabond 50312 646.50 Repair&Maintenance Services and/or Supplies
Embee Performance LLC 50162 754.25 Repair&Maintenance Services and/or Supplies
Employee Benefits Specialists,Inc. 50043 2,975.55 Reimbursed Prepaid Employee Medical&Dependent Care
Employee Benefits Specialists,Inc. 50123 803,671.58 Reimbursed Prepaid Employee Medical&Dependent Care
Employee Benefits Specialists,Inc. 50163 13,846.22 Reimbursed Prepaid Employee Medical&Dependent Care
Employee Benefits Specialists,Inc. 50313 5,992.60 Reimbursed Prepaid Employee Medical&Dependent Care
Enchanter,Inc. 50044 1,520.00 Vessel Services-Monitoring Vessel Nerissa
Enchanter,Inc. 50164 3,040.00 Vessel Services-Monitoring Vessel Nerissa
Enchanter,Inc. 50314 3,040.00 Vessel Services-Monitoring Vessel Nerissa
Environmental Engineering&Contracting 50315 1,800.00 Professional Services/Specialty Course Audits
Environmental Express, Inc. 50165 3,285.77 Laboratory Services&Supplies
Environmental Express, Inc. 50316 3,100.61 Laboratory Services&Supplies
Environmental Resource Associates 50317 963.49 Laboratory Services&Supplies
Environmental Sampling Supply 50045 624.90 Laboratory Services&Supplies
Eros Yong 50260 674.13 Meeting/Training Expense Reimbursement
Ewing Irrigation 50046 197.87 Irrigation Repair&Maintenance Services and/or Supplies
Ewing Irrigation 50318 379.74 Irrigation Repair&Maintenance Services and/or Supplies
Excel Door&Gate Co., Inc. 50319 351.45 Repair&Maintenance Services and/or Supplies
Fedex Corporation 50047 326.94 Freight Services
Fedex Corporation 50166 143.09 Freight Services
First American Commercial 50320 4,777.34 First American Commercial
Fisher Scientific 50321 6,218.27 Laboratory Services&Supplies
Fishing Boats Unlimited 50167 4,301.76 Autos,Trucks&Marine Equipment,Parts,Accessories&Services
Fleming Environmental, Inc. 50322 1,108.31 Repair&Maintenance Services and/or Supplies
Flo Systems,Inc. 50048 581.67 Repair&Maintenance Services and/or Supplies
FLW, Inc. 50049 1,385.44 Electrical/Electronic Equipment,Parts&Repairs
FOPCO Incorporated 50168 4,950.00 Repair&Maintenance Services and/or Supplies
EXHIBIT A
fin/210/mm Page 3 of 10 8/21/2012
Claims Paid From 8/01/12 to 8/15/12
Vendor Warrant No. Amount Description
Fountain Valley AAA Auto Spa 50169 1,875.27 Autos,Trucks&Marine Equipment,Parts,Accessories&Services
Fox Meter,Inc. 50051 1,170.00 Repair&Maintenance Services and/or Supplies
Franchise Tax Board 50170 985.01 Judgments Payable
Franklin Covey 50171 105.80 Office Supplies
Franklin Covey 50324 17.20 Office Supplies
Front Porch Communities Services 50266 26,465.28 Sewer User Refund
Frys Electronics 50172 664.34 Computers,Software/Hardware
G&B Creative Solutions LLC 50053 4,072.69 Event Supplies
GA Industries LLC 50054 3,678.68 Repair&Maintenance Services and/or Supplies
GA Industries LLC 50173 1,614.34 Repair&Maintenance Services and/or Supplies
Garratt Callahan Company 50325 5,069.95 Chemicals,Water/Wastewater Treatment
General Petroleum 50002 30,740.76 Fuel and Lubricants
General Petroleum 50174 3,074.80 Fuel and Lubricants
General Petroleum 50267 45,712.38 Fuel and Lubricants
Glens Alignment&Brake Service 50175 86.00 Autos,Trucks&Marine Equipment,Parts,Accessories&Services
Golden Bell Products 50326 3,920.00 Miscellaneous Parts and Supplies
Golden State Overnight Delivery Service 50327 23.04 Courier Services
Golden West Window Service 50055 5,278.13 Facilities,Maintenance,Services&Supplies
Golden West Window Service 50176 2,008.52 Facilities,Maintenance,Services&Supplies
Golden West Window Service 50328 960.00 Facilities,Maintenance,Services&Supplies
Government Finance Officers Association 50177 55.00 Professional Organizations Meeting/Training/Membership
Grainger, Inc. 50056 4,741.80 Repair&Maintenance Services and/or Supplies
Grainger, Inc. 50178 2,172.56 Repair&Maintenance Services and/or Supplies
Grainger, Inc. 50329 4,378.93 Repair&Maintenance Services and/or Supplies
Graybar Electric Company 50057 7,222.78 Electrical/Electronic Equipment,Parts&Repairs
Graybar Electric Company 50179 4,676.48 Electrical/Electronic Equipment,Parts&Repairs
Graybar Electric Company 50330 20,028.18 Electrical/Electronic Equipment,Parts&Repairs
Great Western Sanitary Supplies 50058 178.30 Janitor&Household Service&Supplies
Great Western Sanitary Supplies 50180 174.77 Janitor&Household Service&Supplies
Guarantee Records Management 50331 727.01 Professional Services-Document Storage&Shredding
H.H.Fremer Architects,Inc. 50332 9,054.91 Construction
Hach c/o Ponton Industries 50181 2,239.22 Laboratory Services&Supplies
Hach Company 50182 6,237.32 Laboratory Services&Supplies
Haley&Aldrich Inc 50333 6,675.00 Professional Services
Handy Hose Services 50334 1,043.40 Repair&Maintenance Services and/or Supplies
Harrington Industrial Plastics,Inc. 50059 5,561.44 Repair&Maintenance Services and/or Supplies
Harrington Industrial Plastics,Inc. 50183 4,033.90 Repair&Maintenance Services and/or Supplies
Hasler,Inc. 50335 64.65 Postage Meter Rental
Hewlett Packard Company 50003 37,130.22 Computers,Software/Hardware
Hewlett Packard Company 50184 17,933.93 Computers,Software/Hardware
Home Depot 50060 1,534.00 Miscellaneous Parts and Supplies
Home Depot 50185 263.92 Miscellaneous Parts and Supplies
Hub Auto Supply 50061 1,079.70 Autos,Trucks&Marine Equipment,Parts,Accessories&Services
Hub Auto Supply 50187 153.27 Autos,Trucks&Marine Equipment,Parts,Accessories&Services
Hub Auto Supply 50336 59.18 Autos,Trucks&Marine Equipment,Parts,Accessories&Services
Huls,Michael R 50428 170.00 Meeting/Training Expense Reimbursement
Hyatt Legal Plans 50338 1,843.00 Professional Services-Legal
Ideastage Promotions,LLC 50189 3,726.00 Public Outreach Supplies
Indiana Child Support Bureau 50190 290.00 Judgments Payable
EXHIBIT A
fin/210/mm Page 4 of 10 8/21/2012
Claims Paid From 8/01/12 to 8/15/12
Vendor Warrant No. Amount Description
Industrial Distribution Group 50191 1,295.58 Repair&Maintenance Services and/or Supplies
Industrial Electric Machinery LLC 50062 4,993.16 Repair&Maintenance Services and/or Supplies
Industrial Fabrics Corp. 50339 14,089.52 Repair&Maintenance Services and/or Supplies
Industrial Metal Supply 50063 894.14 Repair&Maintenance Services and/or Supplies
Intl.Union of Oper.Eng.AFL CIO Local 501 50192 4,932.94 Dues Deductions
IPMC c/o Parsons 50004 506,188.00 Professional Services/Temporary Services
Irvine Ranch Water District 50340 11.78 Water Use
Isle Utilities 50341 20,000.00 Membership in iTAG international R&D Utilities group
J F Shea Construction,Inc. 50273 570,424.09 Construction
J R Filanc Construction 50115 29,875.15 Construction
J R Filanc Construction 50274 871,476.21 Construction
Jacob Dalgoff 50426 825.00 Meeting/Training Expense Reimbursement
James D.Herberg 50427 465.24 Meeting/Training Expense Reimbursement
James R.Ryba M.D.Inc. 50193 125.00 Medical Services
Jamison Engineering Contractors, Inc. 50064 2,862.54 Professional Services/Construction Support Services
Jamison Engineering Contractors, Inc. 50116 36,981.05 Professional Services/Construction Support Services
Jamison Engineering Contractors, Inc. 50342 3,220.00 Professional Services/Construction Support Services
Jays Catering 50065 293.07 Catering Services
Jays Catering 50343 1,333.41 Catering Services
JCI Jones Chemicals, Inc. 659 15,544.38 Chemicals,Water/Wastewater Treatment
JCI Jones Chemicals, Inc. 667 25,024.27 Chemicals,Water/Wastewater Treatment
JCI Jones Chemicals, Inc. 673 41,245.09 Chemicals,Water/Wastewater Treatment
Jensen Instrument Co. 50194 1,473.69 Electrical/Electronic Equipment,Parts&Repairs
Jetters Northwest 50344 13,550.00 Autos,Trucks&Marine Equipment,Parts,Accessories&Services
John S.Anderson 50255 35.00 Meeting/Training Expense Reimbursement
Johnstone Supply 50066 370.29 Repair&Maintenance Services and/or Supplies
Johnstone Supply 50195 2,934.28 Repair&Maintenance Services and/or Supplies
Katherine J.Edwards 50345 14,588.00 Human Resources Services
Kemira Water Solutions 658 148,971.59 Chemicals,Water/Wastewater Treatment
Kemira Water Solutions 668 105,589.43 Chemicals,Water/Wastewater Treatment
Kiewit Infrastructure West Co. 50275 80,750.00 Construction
Kiewit/Mass,A Joint Venture 50013 77,480.57 Construction
Kiewit/Mass,A Joint Venture 50278 31,925.91 Construction
L.Johnson Painting 50067 1,685.00 Facilities,Maintenance,Services&Supplies
L.Johnson Painting 50197 3,520.00 Facilities,Maintenance,Services&Supplies
LA Testing 50198 168.00 Safety,Security,Health Equipment,Supplies,and Services
Labware, Inc. 50005 25,100.00 Repair&Maintenance Services and/or Supplie
Lance Ginest 50257 581.53 Meeting/Training Expense Reimbursement
Larry R.Crandall 50256 35.00 Meeting/Training Expense Reimbursement
LECO Corporation 50068 592.97 Laboratory Services&Supplies
Lee&Ro, Inc. 50346 4,016.38 Professional Services/Engineering Design Services
Liberty Mutual Claims 50347 7,682.50 Insurance
Linda Losurdo 50429 100.77 Meeting/Training Expense Reimbursement
Lowe's HIW, Inc. 50348 1,634.44 Repair&Maintenance Services and/or Supplies
Mag Trol, Inc. 50349 90.53 Electrical Parts&Supplies
Mail Dispatch,LLC 50350 314.70 Mail Delivery Service
Maintenance Superintendents-MSA 50069 50.00 Professional Organizations Meeting/Training/Membership
Mary S.Thompson 50432 121.82 Meeting/Training Expense Reimbursement
Material Control,Inc. 50351 903.05 Repair&Maintenance Services and/or Supplies
EXHIBIT A
fin/210/mm Page 5 of 10 8/21/2012
Claims Paid From 8/01/12 to 8/15/12
Vendor Warrant No. Amount Description
Matt Chlor,Inc. 50352 3,896.51 Repair&Maintenance Services and/or Supplies
Maxim Security Systems 50353 2,086.25 Safety,Security,Health Equipment,Supplies,and Services
MBC Applied Environmental Sciences 50070 3,350.00 Professional Services-Regional Ocean Monitoring
McGladrey&Pullen LLP 50071 13,000.00 Professional Services-Financial Auditing
McMaster-Carr Supply Co. 50354 59.39 Repair&Maintenance Services and/or Supplies
McMaster-Carr Supply Co. 50354 4,892.39 Repair&Maintenance Services and/or Supplies
MCR Technologies,Inc. 50355 236.97 Repair&Maintenance Services and/or Supplies
Mid-West Associates, Inc. 50356 11,972.10 Repair&Maintenance Services and/or Supplies
Minco Products Inc 50200 738.46 Repair&Maintenance Services and/or Supplies
Mine Safety Appliance 50357 1,954.07 Electrical/Electronic Equipment,Parts&Repairs
Mobile Hose&Hydraulic Supply 50358 75.36 Repair&Maintenance Services and/or Supplies
Morrow Meadows Corp. 50276 355,864.50 Construction
Motion Industries, Inc. 50359 1,040.24 Electrical/Electronic Equipment,Parts&Repairs
MSA c/o Geoff Cobbett 50360 50.00 Professional Organizations Meeting/Training/Membership
MTM Recognition Corporation 50072 258.11 Service Awards
MTM Recognition Corporation 50361 135.84 Service Awards
Myers&Sons Hi-Way Safety, Inc. 50362 116.93 Repair&Maintenance Services and/or Supplies
National Seminars Group 50363 597.00 Training Registration
NEAC Compressor Services USA Inc. 50364 2,990.13 Repair&Maintenance Services and/or Supplies
Neal Supply Co. 50365 2,853.70 Repair&Maintenance Services and/or Supplies
Nebar Inc.Dba Haz Rental Center 50366 3,056.00 Event Supplies
NIGP: Nat'l.Inst.Of Govrmmntl.Purchasing 50073 705.00 Professional Organizations Meeting/Training/Membership
Norcal Controls Incorporated 50367 302.22 Repair&Maintenance Services and/or Supplies
NORLAB 50368 134.70 Laboratory Services&Supplies
Northeast Laboratory Services, Inc. 50369 526.00 Laboratory Services&Supplies
Northern Hydraulics, Inc. 50186 152.01 Electrical Parts&Supplies
NRG Engine Services,L.L.C. 50370 1,789.78 Repair&Maintenance Services and/or Supplies
OCEA 50201 663.00 Dues Deductible
Office Depot 50202 8,643.73 Office Supplies
OneSource Distributors, Inc. 50074 213.15 Electrical/Electronic Equipment,Parts&Repairs
OneSource Distributors, Inc. 50203 97.26 Electrical/Electronic Equipment,Parts&Repairs
Oracle America Inc. 50075 2,139.03 Software Maintenance Agreement
Orange County Auto Parts 50204 209.30 Truck Supplies
Orange County Auto Parts 50371 359.55 Truck Supplies
Orange County Sanitation District 50433 1,564.14 Petty Cash Expense
Orange County United Way 50205 40.00 Employee Contributions
Orange County Water District 50006 68,873.68 GAP Water
Orange County Water District 50268 87,757.67 GAP Water
OSTS Inc. 50206 1,245.00 Professional Organizations Meeting/Training/Membership
Pacific Investment Management 50117 175,088.11 Professional Financial Services
Pacific Mechanical Supply 50207 210.93 Repair&Maintenance Services and/or Supplies
Pacific Mechanical Supply 50372 3,033.65 Repair&Maintenance Services and/or Supplies
Parker Supply Company 50373 1,103.86 Miscellaneous Parts and Supplies
Parkhouse Tire,Inc. 50076 842.91 Autos,Trucks&Marine Equipment,Parts,Accessories&Services
Parkhouse Tire,Inc. 50208 1,565.84 Autos,Trucks&Marine Equipment,Parts,Accessories&Services
Parkhouse Tire,Inc. 50374 72.46 Autos,Trucks&Marine Equipment,Parts,Accessories&Services
PC Mall Gov 50209 13,483.24 Software Maintenance Agreement
PCB Piezotronics,Inc. 50375 4,747.86 Electrical/Electronic Equipment,Parts&Repairs
PCS Express, Inc. 50376 301.41 Courier Services
EXHIBIT A
fin/210/mm Page 6 of 10 8/21/2012
Claims Paid From 8/01/12 to 8/15/12
Vendor Warrant No. Amount Description
Pdus2Go.Com Inc 50377 477.60 Professional Organizations Meeting/Training/Membership
Peace Officers Council of CA 50210 2,254.00 Dues Deductions,Supervisors&Professionals
Peak Scientific Inc 50378 1,647.89 Laboratory Services&Supplies
Performance Pipeline Technologies 50118 57,270.51 Professional Services/CCTV Inspection/Sewerline Cleaning
Performance Pipeline Technologies 50379 13,924.08 Professional Services/CCTV Inspection/Sewerline Cleaning
PL Hawn Company,Inc. 50380 1,144.86 Repair&Maintenance Services and/or Supplies
Planetbids, Inc. 50007 65,000.00 Computer Applications&Services
Polydyne,Inc. 669 135,961.12 Chemicals,Water/Wastewater Treatment
Ponton Industries, Inc. 50211 1,600.00 Laboratory Services&Supplies
Praxair Distribution, Inc. 50077 80.21 Laboratory Services&Supplies
Praxair Distribution, Inc. 50381 77.63 Laboratory Services&Supplies
Primrose Ice Co.,Inc. 50212 472.50 Water&Ice Services
Primrose Ice Co.,Inc. 50382 131.25 Water&Ice Services
Procare Work Injury Center 50383 525.00 Medical Services
Project Management Institute 50078 164.00 Professional Organizations Meeting/Training/Membership
Projectline Technical Services,Inc. 50384 9,786.00 Professional Services/Engineering Design Services
Providence Publications,L.L.C. 50144 795.00 Safety,Security,Health Equipment,Supplies,and Services
Prudential Insurance Company of America 50008 43,039.33 Benefits
Prudential Overall Supply 50213 3,121.83 Uniforms
Prudential Overall Supply 50385 1,506.29 Uniforms
PSOMAS 50079 9,350.00 Computer Applications&Services
Public Employer Labor Relations Assoc.CA 50080 300.00 Professional Organizations Meeting/Training/Membership
Public Resources Advisory Group 50214 215.34 Professional Services/Engineering Design Services
Pumping Solutions, Inc. 50386 1,283.89 Repair&Maintenance Services and/or Supplies
Rainbow Disposal Co. 50081 3,493.81 Waste Disposal
Raymond Handling Solutions, Inc. 50082 185.00 Material Handling Tools&Equipment
Red Wing Shoes 50083 170.00 Safety,Security,Health Equipment,Supplies,and Services
Red Wing Shoes 50388 662.39 Safety,Security,Health Equipment,Supplies,and Services
Regents of the University of Calif. 50119 57,078.56 Meeting/Training Registration
Reliastar 50389 3,727.09 Voluntary Employee Life&Cancer Insurance
Restek Corp. 50390 50.31 Laboratory Services&Supplies
RF MacDonald Co. 50387 417.22 Repair&Maintenance Services and/or Supplies
Robert J.Thiede 50431 164.00 Meeting/Training Expense Reimbursement
Roberto's Auto Trim Shop 50216 797.36 Autos,Trucks&Marine Equipment,Parts,Accessories&Services
Romac Supply Co. 50217 377.13 Instrument Parts&Supplies
Roto Rooter NOC#11 50084 599.00 Repair&Maintenance Services and/or Supplies
Roy J.Reynolds 50259 555.59 Meeting/Training Expense Reimbursement
Royale Cleaners 50085 63.90 Miscellaneous Services
Royale Cleaners 50218 69.00 Miscellaneous Services
Royale Cleaners 50391 106.50 Miscellaneous Services
RSA Soil Products 50392 2,574.38 Miscellaneous Parts and Supplies
San Diego/Orange Fluid System Technologies,Inc. 50219 6,172.63 Repair&Maintenance Services and/or Supplies
Sancon Engineering,Inc. 50120 40,750.00 Repair&Maintenance Services and/or Supplies
Sancon Engineering,Inc. 50393 17,496.00 Repair&Maintenance Services and/or Supplies
SARBS-CWEA 50394 25.00 Professional Organizations Meeting/Training/Membership-California Water Environmen
Schwing Bioset 660 1,967.18 Repair&Maintenance Services and/or Supplies
Schwing Bioset 671 12,825.29 Repair&Maintenance Services and/or Supplies
SCPLRC(Southern California Public Rels.Council) 50221 200.00 Professional Organizations Meeting/Training/Membership
Shamrock Supply Co., Inc. 50086 868.90 Repair&Maintenance Services and/or Supplies
EXHIBIT A
fin/210/mm Page 7 of 10 8/21/2012
Claims Paid From 8/01/12 to 8/15/12
Vendor Warrant No. Amount Description
Shamrock Supply Co., Inc. 50222 243.96 Repair&Maintenance Services and/or Supplies
Shureluck Sales&Engineering 50223 134.69 Repair&Maintenance Services and/or Supplies
Siemens c/o Jensen Instrument Co. 50087 581.55 Electrical/Electronic Equipment,Parts&Repairs
Siemens Water Technologies Corp. 50395 1,431.74 Repair&Maintenance Services and/or Supplies
SkillPath Seminars 50088 149.00 Professional Organization&Meeting/Training Registration
So.Cal Gas Company 50224 21,531.71 Utilities
So.Cal Gas Company 50396 3,559.92 Utilities
South Coast Environmental Co. 50220 11,795.52 Professional Services-Air Quality Monitoring
Southern California Edison 50009 110,863.85 Utilities
Southern California Edison 50226 1,898.02 Utilities
Southern California Edison 50269 451,655.38 Utilities
Southern California Water Committee 50227 850.00 Professional Organizations Meeting/Training/Membership
Southern Counties Lubricants 50228 3,714.63 Fuel and Lubricants
SPEX Certiprep,Inc. 50229 76.88 Laboratory Services&Supplies
Staples 50230 921.19 Office Supplies
Summit Steel 50397 5,102.63 Repair&Maintenance Services and/or Supplies
Superior Awning Inc. 50398 1,894.50 Repair&Maintenance Services and/or Supplies
Synagro West, Inc. 50010 374,193.58 Biosolids Management
TCH Associates, Inc. 50231 10,240.56 Laboratory Services&Supplies
TCH Associates, Inc. 50400 224.00 Laboratory Services&Supplies
Terra Renewal,L.L.C. 50011 56,868.63 Grit&Screenings Disposal
TestAmerica Ontario 50089 1,271.25 Laboratory Services&Supplies
TestAmerica Ontario 50232 1,593.00 Laboratory Services&Supplies
Tetra Tech, Inc. 50090 4,559.87 Professional Services/Engineering Design ServicesS
The Bank of New York Mellon 50233 1,721.34 Quarterly Service Fee-Asset Administration
The Clock Sales and Service Co., Inc. 50093 215.06 Repair&Maintenance Services and/or Supplies
The Crab Cooker 50399 1,728.22 Sewer User Refund
The Creative Group 50091 2,352.00 Professional Services/Temporary Services
The Creative Group 50234 1,575.00 Professional Services/Temporary Services
The Standard Insurance Company 50401 2,472.50 Disability Insurance
Thompson Industrial Supply, Inc. 672 709.86 Repair&Maintenance Services and/or Supplies
Thompson Industrial Supply, Inc. 674 2,403.18 Repair&Maintenance Services and/or Supplies
Thompson Industrial Supply, Inc. 50092 1,038.74 Repair&Maintenance Services and/or Supplies
Thompson Industrial Supply, Inc. 50235 2,459.21 Repair&Maintenance Services and/or Supplies
Tiano Construction 50236 3,670.00 Facilities,Maintenance,Services&Supplies
Tony's Lock&Safe Service&Sales 50094 188.59 Repair&Maintenance Services and/or Supplies
Tony's Lock&Safe Service&Sales 50237 1,114.73 Repair&Maintenance Services and/or Supplies
Toshiba Business Solutions USA Inc. 50402 92.77 Computers,Software/Hardware&Managed Services
Total-Western, Inc. 50403 9,975.00 Repair&Maintenance Services and/or Supplies
Townsend Public Affairs 50238 7,500.00 Professional Services-State Legislative Advocacy
Transcat 50095 1,020.52 Repair&Maintenance Services and/or Supplies
Transcat 50239 1,090.78 Repair&Maintenance Services and/or Supplies
Transcat 50404 1,250.33 Repair&Maintenance Services and/or Supplies
Tremco Incorporated 50096 1,498.00 Repair&Maintenance Services and/or Supplies
Tremco Incorporated 50240 4,770.00 Repair&Maintenance Services and/or Supplies
Troemner Inc., 50097 148.27 Repair&Maintenance Services and Supplies
Tuff Skin 50098 700.00 Autos,Trucks&Marine Equipment,Parts,Accessories&Services
Tule Ranch/Magan Farms 50012 247,740.95 Biosolids Management
Tule Ranch/Magan Farms 50270 313,272.27 Biosolids Management
EXHIBIT A
fin/210/mm Page 8 of 10 8/21/2012
Claims Paid From 8/01/12 to 8/15/12
Vendor Warrant No. Amount Description
TW Telecom Holdings, Inc. 50241 5,178.21 Telecommunications
Umesh N.Murthy 50430 150.00 Meeting/Training Expense Reimbursement
Undersea Graphics,Inc. 50099 1,500.00 Repair&Maintenance Services and/or Supplies
Union Bank Escrow No#23861 50277 30,022.33 Construction
Union Bank of California 50405 1,020.95 Banking Services
United Parcel Service 50100 311.78 Freight Services
United Parcel Service 50242 51.36 Freight Services
United Parcel Service 50406 25.93 Freight Services
Univar USA 50407 1,155.35 Miscellaneous Supplies
Univar USA Inc 670 37,395.18 Chemicals,Water/Wastewater Treatment
University of California,San Diego 50271 37,500.00 Professional Services/Surface Mooring Pipe Rehab Project
US Airconditioning Distributors, Inc. 50409 309.95 Electrical Parts&Supplies
US Peroxide,L.L.C. 50121 97,424.92 Chemicals,Water/Wastewater Treatment
USA Bluebook 50410 641.57 Laboratory Services&Supplies
USA Mobility Wireless,Inc. 50411 746.49 Telecommunications
USC 50408 2,559.17 Professional Services/Studies
Valin Corporation 50412 408.01 Repair&Maintenance Services and/or Supplies
Vapex Products,Inc. 50413 9,039.28 Electrical/Electronic Equipment,Parts&Repairs
Verizon California 50243 639.14 Telecommunications
Verizon Wireless 50244 1,175.51 Telecommunications
Verizon Wireless 50414 43.04 Telecommunications
Verne's Plumbing 50101 2,455.51 Plumbing Services&Supplies
Verne's Plumbing 50245 6,000.00 Plumbing Services&Supplies
Verne's Plumbing 50415 70.00 Plumbing Services&Supplies
Village Nurseries 50246 460.28 Repair&Maintenance Services and/or Supplies
Village Nurseries 50416 371.58 Repair&Maintenance Services and/or Supplies
Vortex Corp. 50102 1,016.83 Repair&Maintenance Services and/or Supplies
Vortex Corp. 50417 270.00 Repair&Maintenance Services and/or Supplies
Voyager Fleet Systems, Inc. 50247 23,602.08 Autos,Trucks&Marine Equipment,Parts,Accessories&Services
VWR Scientific Products 50103 332.46 Laboratory Services&Supplies
VWR Scientific Products 50248 90.38 Laboratory Services&Supplies
VWR Scientific Products 50418 6,239.37 Laboratory Services&Supplies
W.M.Lyles Co. 50122 95,000.00 Construction
Wastewater Technology Trainers 50104 2,595.00 Professional Organizations Meeting/Training/Membership
Water Environment Federation 50105 358.00 Professional Organizations Meeting/Training/Membership
Water Environment Federation 50249 537.00 Professional Organizations Meeting/Training/Membership
Water Environment Federation 50419 358.00 Professional Organizations Meeting/Training/Membership
Waters Corporation 50420 211.84 Laboratory Services&Supplies
Waxie Sanitary Supply 50421 347.74 Janitor&Household Service&Supplies
Weck Laboratories,Inc. 50106 1,200.00 Laboratory Services&Supplies
Wells Fargo Bank 50425 4,250.00 Construction,Retention
Wells Fargo Bank Escrow 23518600 50110 4,077.93 Construction,Retention
West Lite Supply Company,Inc. 50422 5,960.80 Electrical/Electronic Equipment,Parts&Repairs
Western Analytical Laboratories, Inc. 50107 1,020.00 Outside Laboratory Services
Western States Controls 50423 1,189.12 Electrical/Electronic Equipment,Parts&Repairs
White Star Pools 50250 310.00 Repair&Maintenance Services and/or Supplies
Woodruff Spradlin&Smart 50272 90,540.33 Professional Services-Legal
Xerox Corporation 50251 117.67 Computers,Software/Hardware&Managed Services
Xpedx,An International Paper Company 50252 1,587.87 Miscellaneous Supplies
EXHIBIT A
fin/210/mm Page 9 of 10 8/21/2012
Claims Paid From 8101/12 to 8/15112
Vendor Warrant No. Amount Description
Xyon Business Solutions, Inc. 50108 1,280.00 Professional Services/Temporary Services
Y.J.Shao 50111 190.00 Meeting/Training Expense Reimbursement
Yale/Chase Materials Handling, Inc. 50109 340.31 Electrical/Electronic Equipment,&Electric Cart Parts&Repairs
24 Hour Fire Protection, Inc. 50254 1,469.25 Repair&Maintenance Services and/or Supplies
24 Hour Fire Protection, Inc. 50424 16,986.54 Repair&Maintenance Services and/or Supplies
Total Accounts Payable-Warrants $ 7,901,458.07
Payroll Disbursements
Employee Paychecks 49536 - 49562 $ 4,550.92 Interim Payroll-ARBA(8/01/12)*
Employee Paychecks 49564 3,115.54 Interim Payroll-Retirements(8/02/12)
Employee Paychecks 49565 4,666.08 Interim Payroll-Payouts(8/02/12)
Employee Paychecks 49566 - 49620 93,528.55 Biweekly Payroll(8/08/12)
Employee Paychecks 49621 758.76 Interim Payroll-Termination Intern(8/09/12)
Direct Deposit Statements 324183-324349 38,556.41 Interim Payroll-ARBA(8/01/12)
Direct Deposit Statements 324350-324924 1,412,497.51 Biweekly Payroll(8/08/12)
Total Payroll Disbursements $ 1,557,673.77 *Check number 49563 used in prior period
Wire Transfer Payments
OCSD Payroll Taxes&Contributions $ 824,059.20 Biweekly Payroll(/08/12)
Union Bank of California 55,000.00 Workers'Compensation Services(8/08/12)
Total Wire Transfer Payments $ 879,059.20
EXHIBIT A
fin/210/mm Page 10 of 10 8/21/2012
Claims Paid From 8/16/12 to 8/31/12
Vendor Warrant No. Amount Description
Accounts Payable Warrants
AccuStandard 50654 $ 212.99 Laboratory Services&Supplies
AECOM Technical Services, Inc. 50434 31,430.91 Professional Services/Engineering Design Services
AECOM Technical Services, Inc. 50638 36,743.52 Professional Services/Engineering Design Services
Air Liquide America Corp. 50446 1,255.15 Laboratory Services&Supplies
Airgas Safety,Inc. 50447 3,910.45 Safety,Security,Health Equipment,Supplies,and Services
Airgas Safety,Inc. 50655 4,807.27 Safety,Security,Health Equipment,Supplies,and Services
Airgas USA,LLC 50448 2,526.44 Laboratory Services&Supplies
Airgas USA,LLC 50656 382.40 Laboratory Services&Supplies
Airgas West 50449 1,669.83 Repair&Maintenance Services and/or Supplies
Airgas West 50657 2,695.52 Repair&Maintenance Services and/or Supplies
Alhambra Foundry Co.,Ltd. 50450 1,913.64 Repair&Maintenance Services and/or Supplies
Alimed Inc. 50451 646.25 Laboratory Services&Supplies
Allied Electronics,Inc. 50452 291.60 Electrical/Electronic Equipment,Parts&Repairs
Aloma Shim And Manufacturing Co 50453 94.14 Repair&Maintenance Services and/or Supplies
American Chemical Society 50659 163.00 Professional Organizations Meeting/Training/Membership
American Machinery&Blade, Inc. 50660 745.08 Repair&Maintenance Services and/or Supplies
American Soc.of Safety Eng. 50454 180.00 Publication
American Society of Mechanical Engineers 50661 144.00 Professional Organizations Meeting/Training/Membership
Amtech Elevator Services 50455 2,200.00 Miscellaneous Services
Amtech Elevator Services 50662 1,035.00 Miscellaneous Services
Ann Crafton 50774 100.00 Meeting/Training Expense Reimbursement
Applied Industrial Technology 50456 1,920.05 Repair&Maintenance Services and/or Supplies
Aquatic Biosystems, Inc. 50457 303.00 Laboratory Services&Supplies
Arcon Structural Engineers,Inc. 50459 4,390.00 Professional Services/Structural Design
Argus-Hazco 50460 7,641.64 Repair&Maintenance Services and/or Supplies
Argus-Hazco 50663 703.61 Repair&Maintenance Services and/or Supplies
Ashbrook Simon Hartley Operations, L.P. 50461 282.26 Repair&Maintenance Services and/or Supplies
AT&T 50653 240.49 Telecommunications
AT&T Long Distance. 50462 52.25 Telecommunications
AT&T Mobility II,L.L.C. 50463 7,826.53 Telecommunications
AT&T Mobility II,L.L.C. 50464 230.27 Telecommunications
AT&T Mobility II,L.L.C. 50665 199.99 Telecommunications
AT&T Universal Biller 50664 2,829.50 Telecommunications
AT&T Teleconference Services 50465 78.26 Telecommunications
ATM AA, Inc. 50666 280.00 Lab Services
AWSI 50667 229.00 Professional Services-DOT Program Administration
AWWA 50466 775.00 Professional Organizations Meeting/Training/Membership
AWWA 50668 238.00 Professional Organizations Meeting/Training/Membership
Bank of New York Mellon Trust 50435 28,281.91 Professional Services-Financial
Battery Specialties 50467 87.28 Batteries,Various
Battery Systems, Inc. 50468 2,333.26 Repair&Maintenance Services and/or Supplies
Battery Systems, Inc. 50669 1,598.67 Repair&Maintenance Services and/or Supplies
Black&Veatch Corporation 50639 37,599.26 Professional Services/Engineering Design Services
Black&Veatch Corporation 50639 24,492.55 Professional Services/Engineering Design Services
BLX Group 50469 2,250.00 Professional Financial Services
Bravo Zulu International Ltd. 50670 48.71 Repair&Maintenance Services and/or Supplies
Brown&Caldwell 50640 346,171.46 Professional Services/Engineering Design Services
California Bank&Trust#201037519 50440 95,516.59 Construction
EXHIBIT B
fin/210/mm Page 1 of 8 9/10/2012
Claims Paid From 8/16/12 to 8/31/12
Vendor Warrant No. Amount Description
California Barricade Rentals 50671 1,300.00 Miscellaneous Services
California Dept.of Child Support 50471 1,984.24 Judgments Payable
California Recreation Company 50672 3,356.64 Boat Slip Rental-Nerissa Ocean Monitoring Vessel
California Relocation Services,Inc. 50472 315.00 Miscellaneous Services-Moving/Relocation
Caltrol,Inc. 50473 1,184.60 Electrical/Electronic Equipment,Parts&Repairs
Cambridge Isotope Labs 50673 151.63 Laboratory Services&Supplies
Carollo Engineers 50641 53,837.30 Professional Services/Engineering Design Services
Cashco,Inc. 50474 967.22 Mechanical Parts&Supplies
CDN Isotopes 50475 1,890.00 Laboratory Services&Supplies
Certified Laboratories 50476 912.63 Laboratory Services&Supplies
Certified Laboratories 50674 226.04 Laboratory Services&Supplies
City Clerk's Association of California 50477 200.00 Professional Organizations Meeting/Training/Membership
City of Brea 50470 531.05 CFCC Refund
City of Huntington Beach 50521 136.26 Water Use
City of Huntington Beach 50711 15,659.98 Water Use
City of Newport Beach 50724 1,015.20 Water Use
City of Westminster 50478 28.23 Water Use
Clean Harbors Environmental Services 50675 18,436.02 Grit&Screenings;Hazard Waste Disposal
CMAA 50479 70.00 Professional Organizations Meeting/Training/Membership
CMS Communications, Inc. 50676 22,232.52 Computer Applications&Services
Columbia Analytical Services 50658 1,700.00 Laboratory Services&Supplies
Commuter Van Conversion, Inc. 50480 96.98 Repair&Maintenance Services-Installation of ABTS Seat Belt Modules
Consumers Pipe&Supply Co. 50677 5,019.32 Repair&Maintenance Services and/or Supplies
Continental Computers 50481 3,000.00 Computer Keyboards
Controlled Motion Solutions 50482 360.19 Repair&Maintenance Services and/or Supplies
Converse Consultants 50678 7,050.25 Professional Services/Professional Services/Materials&Geotechnical Testing
Coro Southern California 50484 5,000.00 Professional Organizations Meeting/Training/Membership
Counterpart Enterprises, Inc. 50679 332.21 Repair&Maintenance Services and/or Supplies
County of Orange Auditor Controller 50485 1,230.04 Governmental Agency Fees&Charges
County of Orange Auditor Controller 50486 570.00 Governmental Agency Fees&Charges
County of Orange Auditor Controller 50487 690.00 Governmental Agency Fees&Charges
County of Orange Auditor Controller 50488 495.00 Governmental Agency Fees&Charges
County of Orange Auditor Controller 50680 870.00 Governmental Agency Fees&Charges
Court Order 50530 2,179.38 Judgments Payable
Court Order 50538 150.00 Judgments Payable
Court Order 50574 108.00 Judgments Payable
Court Order 50622 912.50 Judgments Payable
CR&R, Inc. 50681 673.56 Waste Disposal
CS-AMSCO 50682 245.67 Repair&Maintenance Services and/or Supplies
CSI Services, Inc. 50489 11,009.50 Professional Services
CSI Services, Inc. 50642 26,557.00 Professional Services
Culligan of Orange County 50683 63.25 Repair&Maintenance Services and/or Supplies
CWEA Membership 50490 140.00 Professional Organizations Meeting/Training/Membership
CWEA Membership 50684 132.00 Professional Organizations Meeting/Training/Membership
David Gutoff 50491 225.00 Laboratory Services&Supplies
David Rodriguez 50636 1,742.25 Meeting/Training Expense Reimbursement
Dawn K.Myers 50628 150.00 Meeting/Training Expense Reimbursement
Demsey,Filliger&Associates 50685 5,000.00 Professional Services
Dosa Express 50686 20.00 Refund Overpayment
EXHIBIT B
fin/210/mm Page 2 of 8 9/10/2012
Claims Paid From 8/16/12 to 8/31/12
Vendor Warrant No. Amount Description
Doug Rulison 50781 691.00 Meeting/Training Expense Reimbursement
Dudek&Associates, Inc. 50643 26,284.45 Professional Services/Engineering Design Services
Dwyer Instruments, Inc. 50492 840.48 Electrical/Electronic Equipment,Parts&Repairs
Eagle Aerial Imaging 50687 8,250.00 Computer Applications&Services
Elite Equipment Inc. 50688 287.37 Repair&Maintenance Services and/or Supplies
Employee Benefits Specialists,Inc. 50493 13,846.22 Reimbursed Prepaid Employee Medical&Dependent Care
Enchanter,Inc. 50689 3,800.00 Vessel Services-Monitoring Vessel Nerissa
ENS Resources, Inc. 50494 7,500.00 Professional Services-Federal Advocacy
Environmental Water Solutions,Inc. 50495 9,467.18 Repair&Maintenance Services and/or Supplies
Fedex Corporation 50496 29.14 Freight Services
Fedex Corporation 50690 82.96 Freight Services
First American Corelogic 50483 90.00 Software Maintenance Agreement
Fisher Scientific 50498 2,578.33 Laboratory Services&Supplies
Fisher Scientific 50691 3,378.99 Laboratory Services&Supplies
Five Star Metals, Inc. 50692 875.00 Miscellaneous Parts and Supplies
Fluid Components Int.c/o Ponton Industries 50499 1,721.75 Repair&Maintenance Services and/or Supplies
FOPCO Incorporated 50693 850.00 Repair&Maintenance Services and/or Supplies
Fountain Valley Paints,Inc. 50500 43.10 Facilities,Maintenance,Services&Supplies
Fountain Valley Paints,Inc. 50694 169.80 Facilities,Maintenance,Services&Supplies
Franchise Tax Board 50501 1,035.01 Judgments Payable
Frys Electronics 50695 86.17 Computers,Software/Hardware
Fuller Truck Accessories 50696 902.13 Autos,Trucks&Marine Equipment,Parts,Accessories&Services
General Petroleum 50502 4,054.67 Fuel and Lubricants
George Yardley Co. 50503 445.31 Repair&Maintenance Services and/or Supplies
Glen Mills Inc. 50504 800.00 Laboratory Services&Supplies
Glens Alignment&Brake Service 50505 86.00 Autos,Trucks&Marine Equipment,Parts,Accessories&Services
GMF Sound,Inc. 50506 345.00 Professional Services
Golden State Overnight Delivery Service 50697 12.36 Courier Services
Golden State Water Company 50698 170.26 Water Use
Golden West Machine, Inc. 50699 11,411.54 Repair&Maintenance Services and/or Supplies
Golden West Window Service 50507 1,020.20 Facilities,Maintenance,Services&Supplies
Golden West Window Service 50700 4,272.00 Facilities,Maintenance,Services&Supplies
Grainger, Inc. 50508 2,735.45 Repair&Maintenance Services and/or Supplies
Grainger, Inc. 50701 1,907.21 Repair&Maintenance Services and/or Supplies
Graybar Electric Company 50509 29.24 Electrical/Electronic Equipment,Parts&Repairs
Graybar Electric Company 50702 9,024.85 Electrical/Electronic Equipment,Parts&Repairs
Great Western Sanitary Supplies 50703 139.81 Janitor&Household Service&Supplies
Guy L.Warden&Sons 50510 1,439.18 Repair&Maintenance Services and/or Supplies
H.H.Fremer Architects,Inc. 50704 14,041.88 Construction
Hach c/o Ponton Industries 50705 15,981.49 Laboratory Services&Supplies
Hach Company 50511 1,654.65 Laboratory Services&Supplies
Hach Company 50706 252.26 Laboratory Services&Supplies
Haley&Aldrich Inc 50512 825.00 Professional Services
Hardy Diagnostics 50513 1,173.36 Laboratory Services&Supplies
Harrington Industrial Plastics,Inc. 50514 2,013.16 Repair&Maintenance Services and/or Supplies
Harrington Industrial Plastics,Inc. 50707 1,109.98 Repair&Maintenance Services and/or Supplies
Hartzell Fan Inc. 50515 4,833.32 Electrical/Electronic Equipment,Parts&Repairs
Hasco Oil Co.,Inc. 50516 546.50 Fuel and Lubricants
HDR Engineering, Inc. 50644 423,220.42 Professional Services/Engineering Design Services
EXHIBIT B
fin/210/mm Page 3 of 8 9/10/2012
Claims Paid From 8/16/12 to 8/31/12
Vendor Warrant No. Amount Description
Helix Electric, Inc. 50441 249,169.80 Construction
Hewlett Packard Company 50517 15,688.37 Computers,Software/Hardware
Hi Standard Automotive,L.L.C. 50708 2,645.95 Autos,Trucks&Marine Equipment,Parts,Accessories&Services
Hoist Service Inc. 50518 92.00 Repair&Maintenance Services and/or Supplies
Home Depot 50519 1,200.97 Miscellaneous Parts and Supplies
Home Depot 50709 2,060.83 Miscellaneous Parts and Supplies
Hub Auto Supply 50520 189.88 Autos,Trucks&Marine Equipment,Parts,Accessories&Services
Hub Auto Supply 50710 343.48 Autos,Trucks&Marine Equipment,Parts,Accessories&Services
Indiana Child Support Bureau 50522 290.00 Judgments Payable
Industrial Fabrics Corp. 50712 11,012.99 Repair&Maintenance Services and/or Supplies
Industrial Filter Manufacturers,Inc. 50523 1,163.68 Repair&Maintenance Services and/or Supplies
Infrastructure Engineering Corp. 50713 9,882.85 Professional Services
Insight Public Sector,Inc. 50524 3,468.36 Computers,Software/Hardware
Integrated Process Technologies, Inc. 50714 4,975.06 Repair&Maintenance Services and/or Supplies
Intl.Union of Oper.Eng.AFL CIO Local 501 50525 4,884.44 Dues Deductions
Invensys Systems,Inc. 50526 4,125.84 Electrical/Electronic Equipment,Parts&Repairs
Irvine Ranch Water District 50527 81.17 Water Use
Irvine Ranch Water District 50645 246,590.00 Water Use
J R Filanc Construction 50436 48,121.90 Construction
Jacobs Project Management Co. 50437 35,127.82 Professional Services/Temporary Services
James D.Ruth 50629 1,358.54 Meeting/Training Expense Reimbursement
Jamison Engineering Contractors, Inc. 50646 163,898.47 Professional Services/Construction Support Services
Jays Catering 50715 723.27 Catering Services
JCI Jones Chemicals, Inc. 677 11,790.35 Chemicals,Water/Wastewater Treatment
JCI Jones Chemicals, Inc. 681 8,647.05 Chemicals,Water/Wastewater Treatment
JNJ Enterprises Cob 03/20/12 50528 172.08 Refund Overpayment
John S.Anderson 50623 1,370.42 Meeting/Training Expense Reimbursement
Johnstone Supply 50529 403.98 Repair&Maintenance Services and/or Supplies
Johnstone Supply 50716 593.74 Repair&Maintenance Services and/or Supplies
Kanawha Insurance Company 50531 2,172.41 Voluntary Benefits-SSTD Insurance
Katherine J.Edwards 50717 4,130.00 Human Resources Services
Kemira Water Solutions 675 39,259.18 Chemicals,Water/Wastewater Treatment
Kemira Water Solutions 680 128,423.54 Chemicals,Water/Wastewater Treatment
Ken A.Sakamoto 50630 389.92 Meeting/Training Expense Reimbursement
Kenny/Jenks Consultants,Inc. 50532 842.03 Professional Services 7-49
Keyper Systems 50533 478.01 Key Storage System
Kievit/Mass,A Joint Venture 50652 98,340.35 Construction
L.Johnson Painting 50534 4,895.00 Facilities,Maintenance,Services&Supplies
Labware, Inc. 50535 600.00 Repair&Maintenance Services and/or Supplie
Larry R.Crandall 50775 1,066.30 Meeting/Training Expense Reimbursement
Lee&Ro, Inc. 50718 2,342.60 Professional Services/Engineering Design Services
Lexis-Nexis 50536 84.00 Books&Publications On-Line
Liebert Cassidy 50537 10,374.56 Professional Services/Employee Relations
Lisa A.Rothbart 50780 1,352.88 Meeting/Training Expense Reimbursement
LittleJohn-Reu land Corporation 50719 7,489.85 Repair&Maintenance Services and/or Supplies
Lucci's Gourmet Foods, Inc. 50539 161.64 Catering Services
Lynn R.Morgan 50779 136.06 Meeting/Training Expense Reimbursement
Maria E.Ayala 50773 210.00 Meeting/Training Expense Reimbursement
Marvac Electronics 50720 77.45 Electrical/Electronic Equipment,Parts&Repairs
EXHIBIT B
fin/210/mm Page 4 of 8 9/10/2012
Claims Paid From 8/16/12 to 8/31/12
Vendor Warrant No. Amount Description
Matthew J.Connor 50625 130.00 Meeting/Training Expense Reimbursement
Maureen Kane&Associates 50721 1,280.00 Professional Organizations Meeting/Training/Membership
McClure,John F. 50540 770.12 Sewer User Refund
McGladrey&Pullen LLP 50722 6,000.00 Professional Services-Financial Auditing
McMaster-Carr Supply Co. 50541 1,435.55 Repair&Maintenance Services and/or Supplies
MCR Technologies,Inc. 50542 604.10 Repair&Maintenance Services and/or Supplies
Mesa International Technologies,Inc. 50543 962.43 Repair&Maintenance Services and/or Supplies
Michael I.Gold 50776 223.04 Meeting/Training Expense Reimbursement
Michael I.Zedek 50634 363.30 Meeting/Training Expense Reimbursement
Mid-West Associates, Inc. 50723 7,391.76 Repair&Maintenance Services and/or Supplies
Municipal Water District of O.C. 50544 16,543.00 Governmental Agency Fees&Charges
MWH Americas,Inc. 50647 42,980.61 Professional Services/Engineering Design Services
National Notary Association 50545 148.00 Professional Organizations Meeting/Training/Membership
NEAC Compressor Services USA Inc. 50546 10,560.18 Repair&Maintenance Services and/or Supplies
Neal Supply Co. 50547 39.98 Repair&Maintenance Services and/or Supplies
NetworkFleet, Inc. 50548 2,906.05 Software Maintenance Agreement
Ninyo&Moore 50725 7,019.50 Professional Services/Geotech&Material Testing
Norman A.Traub Associates 50549 5,205.00 Legal Services
NRG Engine Services,L.L.C. 50726 19,287.00 Repair&Maintenance Services and/or Supplies
Oau Shave Ice,LLC 50550 1,050.00 Public Outreach Services and Supplies
OCB Reprographics 50458 22,164.22 Printing/Reprographics Services
OCEA 50551 672.75 Dues Deductible
Office Depot 50552 4,634.03 Office Supplies
Office Depot 50727 707.40 Office Supplies
Omega Industrial Supply,Inc. 50553 2,369.09 Janitor&Household Service&Supplies
Omega Industrial Supply,Inc. 50728 2,370.10 Janitor&Household Service&Supplies
OneSource Distributors, Inc. 50554 3,766.10 Electrical/Electronic Equipment,Parts&Repairs
OneSource Distributors, Inc. 50729 1,796.69 Electrical/Electronic Equipment,Parts&Repairs
Orange Coast Auto Body,Inc. 50555 1,388.17 Autos,Trucks&Marine Equipment,Parts,Accessories&Services
Orange County Hose Company 50556 64.87 Miscellaneous Parts and Supplies
Orange County Tax Collector 50558 14,558.27 Governmental Agency Fees&Charges
Orange County United Way 50559 40.00 Employee Contributions
Orange County Vector Control District 50730 286.83 Pest Control
Pacific Mechanical Supply 50560 172.60 Repair&Maintenance Services and/or Supplies
Pacific Mechanical Supply 50731 2,148.09 Repair&Maintenance Services and/or Supplies
Parker Supply Company 50561 588.32 Miscellaneous Parts and Supplies
Peace Officers Council of CA 50562 2,254.00 Dues Deductions,Supervisors&Professionals
Performance Pipeline Technologies 50732 20,120.29 Professional Services/CCTV Inspection/Sewerline Cleaning
Phillip J.Sullivan 50632 796.63 Meeting/Training Expense Reimbursement
Pirtek Long Beach 50733 545.11 Repair&Maintenance Services and/or Supplies
Pivot Interiors Inc. 50563 709.90 Office Supplies/Furniture
Polydyne,Inc. 676 56,099.59 Chemicals,Water/Wastewater Treatment
Port Supply 50564 9.07 Autos,Trucks&Marine Equipment,Parts,Accessories&Services
PPM 2000, Inc. 50565 1,000.00 Computer Applications&Services
Precon Products 50566 1,400.75 Repair&Maintenance Services and/or Supplies
Primrose Ice Co.,Inc. 50567 131.25 Water&Ice Services
Procare Work Injury Center 50568 790.00 Medical Services
Prudential Overall Supply 50569 1,570.57 Uniforms
Pump Action 50570 4,359.64 Oil Filters
EXHIBIT B
fin/210/mm Page 5 of 8 9/10/2012
Claims Paid From 8/16/12 to 8/31/12
Vendor Warrant No. Amount Description
Quickstart Intelligence 50571 4,875.00 Professional Organizations Meeting/Training/Membership
Rainbow Disposal Co. 50575 3,493.81 Waste Disposal
RBF Consulting 50734 2,731.00 Professional Services/Engineering Design Services
Regents of University of California 50576 4,995.00 Registration
Resource Environmental, Inc. 50735 14,575.00 Facilities,Maintenance,Services&Supplies
RF MacDonald Co. 50572 50.59 Repair&Maintenance Services and/or Supplies
Richard D.Chappell 50624 1,382.46 Meeting/Training Expense Reimbursement
Riddell All American 50573 510.00 Refund Overpayment
RMS Engineering&Design, Inc. 50577 8,910.00 Professional Services/Engineering Design Services
RMS Engineering&Design, Inc. 50736 4,425.00 Professional Services/Engineering Design Services
Robbie A.Coronel 50626 170.00 Meeting/Training Expense Reimbursement
Robert D.Michaels 50778 289.72 Meeting/Training Expense Reimbursement
Robert M.Whitney 50633 233.02 Meeting/Training Expense Reimbursement
Robert P.Ghirelli 50627 1,322.51 Meeting/Training Expense Reimbursement
Rockhurst University Continuing Education Center, Inc. 50737 1,393.00 Professional Organizations Meeting/Training/Membership
Royal Wholesale Electric 50578 2,825.87 Repair&Maintenance Services and/or Supplies
RPM Electric Motors 50579 2,631.81 Repair&Maintenance Services and/or Supplies
Ruben Gomez 50777 1,584.16 Meeting/Training Expense Reimbursement
San Diego/Orange Fluid System Technologies,Inc. 50738 923.94 Repair&Maintenance Services and/or Supplies
San Marino Environmental Associates 50580 4,250.00 Professional Services/Environmental Consulting Services
Sancon Engineering,Inc. 50739 13,615.00 Repair&Maintenance Services and/or Supplies
SCE 50581 1,494.33 Repair&Maintenance Services and/or Supplies
Schwng Bioset 678 45.83 Repair&Maintenance Services and/or Supplies
Schwing Bioset 682 82.55 Repair&Maintenance Services and/or Supplies
SCS Engineers 50740 2,500.00 Professional Services/Air Quality Monitoring
Securitas Security Services USA, Inc. 50438 31,229.65 Safety,Security,Health Equipment,Supplies,and Services
SETAC 50582 1,202.50 Professional Organizations Meeting/Training/Membership
SETAC 50637 160.00 Professional Organizations Meeting/Training/Membership
Shamrock Supply Co., Inc. 50583 1,606.37 Repair&Maintenance Services and/or Supplies
Shamrock Supply Co., Inc. 50741 8,323.70 Repair&Maintenance Services and/or Supplies
Shureluck Sales&Engineering 50584 1,683.60 Repair&Maintenance Services and/or Supplies
Siemens c/o Jensen Instrument Co. 50585 2,977.48 Electrical/Electronic Equipment,Parts&Repairs
Sigma-Aldrich, Inc. 50742 128.39 Laboratory Services&Supplies
Snap On Industrial 50743 35.91 Tools
So.Cal Gas Company 50586 8,287.04 Utilities
South Coast Air Quality Management District 50782 1,102.28 Governmental Agency Fees&Charges
Southern Califoria Setac 50744 20.00 Professional Organization
Southern California Edison 50648 98,010.71 Utilities
Southern Counties Lubricants 50587 6,406.84 Fuel and Lubricants
Southland Envelope Company, Inc. 50588 651.67 Office Supplies
Sparklett-Dallas 50589 676.80 Miscellaneous Services
Spectrum Laboratory Products,Inc. 50745 232.20 Laboratory Services&Supplies
SST Benefits Consutling&Insurance Services 50590 5,000.00 Professional Services
St.Croix Sensory, Inc. 50591 2,686.00 Olfactometry Testing Services
Stanek Constructors Inc 50443 854,649.27 Construction
Stantec Consulting Services, Inc. 50746 3,463.00 Professional Services/Surveying
Stanton Radiator 50747 1,077.50 Repair&Maintenance Services and/or Supplies
Staples 50592 87.57 Office Supplies
Staples 50748 120.61 Office Supplies
EXHIBIT B
fin/210/mm Page 6 of 8 9/10/2012
Claims Paid From 8/16/12 to 8/31/12
Vendor Warrant No. Amount Description
State Board of Equalization 50593 378.18 Governmental Agency Fees&Charges
State of California 50783 6,000.00 Application Fee&Staff Appreciation Day Expenses
Stratus Environmental,Inc. 50594 3,375.00 Professional Services/Groundwater Removal
Stryper Technologies 50749 3,728.67 Computer Hardware&Software
Summit Steel 50595 2,128.67 Repair&Maintenance Services and/or Supplies
Summit Steel 50750 2,395.09 Repair&Maintenance Services and/or Supplies
Sunset Industrial Parts 50596 203.51 Repair&Maintenance Services and/or Supplies
Sunset Industrial Parts 50751 530.88 Repair&Maintenance Services and/or Supplies
Synagro West, Inc. 50649 67,476.37 Biosolids Management
Systea Scientific,L.L.C. 50597 5,845.00 Laboratory Services&Supplies
Systea Scientific,L.L.C. 50752 892.55 Laboratory Services&Supplies
TestAmerica Ontario 50598 1,050.00 Laboratory Services&Supplies
TestAmerica Ontario 50753 527.00 Laboratory Services&Supplies
The Fire X-Tinguisher Service Co. 50497 710.83 Safety,Security,Health Equipment,Supplies,and Services
The Orange County Register 50557 3,734.00 Notices&Ads
The Trane Company 50602 5,243.00 Repair&Maintenance Services and/or Supplies
The Unisource Corporation 50606 872.78 Paper&Office Supplies
The Walking Man,Inc. 50754 425.00 Miscellaneous Services
Theodore Robins Ford 50599 143.82 Autos,Trucks&Marine Equipment,Parts,Accessories&Services
Thompson Industrial Supply, Inc. 679 2,437.23 Repair&Maintenance Services and/or Supplies
Thompson Industrial Supply, Inc. 683 11,998.67 Repair&Maintenance Services and/or Supplies
Time Warner Communications 50755 59.17 Telecommunications
Titan Power,Inc. 50756 145.07 Repair&Maintenance Services and/or Supplies
Tony's Lock&Safe Service&Sales 50600 105.09 Repair&Maintenance Services and/or Supplies
Tony's Lock&Safe Service&Sales 50757 268.03 Repair&Maintenance Services and/or Supplies
Toshiba Business Solutions USA Inc. 50601 648.93 Computers,Software/Hardware&Managed Services
Trace3,Inc. 50439 57,486.40 Computer Applications&Services
Transcat 50603 1,631.40 Repair&Maintenance Services and/or Supplies
Tropical Plaza Nursery,Inc. 50758 12,497.50 Landscape Maintenance Services
Tuff Skin 50759 325.00 Autos,Trucks&Marine Equipment,Parts,Accessories&Services
Tule Ranch/Magan Farms 50650 229,605.48 Biosolids Management
UC Regents 50604 810.00 Professional Organizations Meeting/Training/Membership
Underground Service Alert of So.Calif 50760 1,636.50 Professional Services-Dig Alert Notification Service
Undersea Graphics,Inc. 50605 8,000.00 Repair&Maintenance Services and/or Supplies
Union Bank of California 50635 2,378.15 Construction,Retention
Union Bank of California Escrow 50444 63,857.97 Construction,Retention
United Parcel Service 50607 1,334.12 Freight Services
United Power Service,Inc. 50608 146.00 Electrical/Electronic Equipment,Parts&Repairs
Univar USA Inc 684 16,999.38 Chemicals,Water/Wastewater Treatment
Valin Corporation 50609 2,727.53 Repair&Maintenance Services and/or Supplies
Valley Power Systems,Inc. 50610 180.91 Repair&Maintenance Services and/or Supplies
Vapex Products,Inc. 50611 15,822.89 Electrical/Electronic Equipment,Parts&Repairs
Verizon Wireless 50761 43.04 Telecommunications
Verne's Plumbing 50612 1,065.00 Plumbing Services&Supplies
Verne's Plumbing 50762 1,600.00 Plumbing Services&Supplies
Village Nurseries 50763 28.21 Repair&Maintenance Services and/or Supplies
Vision Financial Corporation 50613 1,173.28 Employee Voluntary Benefits
Vision Financial Corporation 50764 1,124.32 Employee Voluntary Benefits
Vortex Corp. 50765 432.00 Repair&Maintenance Services and/or Supplies
EXHIBIT B
fin/210/mm Page 7 of 8 9/10/2012
Claims Paid From 8/16/12 to 8/31/12
Vendor Warrant No. Amount Description
Vortex Corp. 50765 349.30 Repair&Maintenance Services and/or Supplies
VWR Scientific Products 50614 3,189.48 Laboratory Services&Supplies
VWR Scientific Products 50766 338.76 Laboratory Services&Supplies
W.M.Elliott 50615 51.00 Refund Overpayment
Wastewater Equipment International,Inc 50767 4,934.95 Repair&Maintenance Services and/or Supplies
Wastewater Technology Trainers 50768 865.00 Professional Organizations Meeting/Training/Membership
Water Environment Federation 50769 333.00 Professional Organizations Meeting/Training/Membership
Waxie Sanitary Supply 50616 101.86 Janitor&Household Service&Supplies
Wells Fargo Bank Escrow 23518600 50772 4,912.65 Construction,Retention
Wendy T.Sevenandt 50631 164.00 Meeting/Training Expense Reimbursement
West Coast Safety Supply Co. 50770 2,377.61 Safety,Security,Health Equipment,Supplies,and Services
WetLabs,Inc. 50617 5,575.00 Laboratory Services&Supplies
Wondries Fleet Group 50651 62,840.06 Vehicle Purchases
Xerox Corporation 50618 19,623.26 Computers,Software/Hardware&Managed Services
Xpedx,An International Paper Company 50619 10,319.45 Miscellaneous Supplies
Xyon Business Solutions, Inc. 50620 5,120.00 Professional Services/Temporary Services
Yale/Chase Materials Handling, Inc. 50621 4,105.23 Electrical/Electronic Equipment,&Electric Cart Parts&Repairs
Yardley-Zaretsky,Inc. 50771 840.00 Professional Services P1-110
Total Accounts Payable-Warrants $ 4,628,967.51
Payroll Disbursements
Employee Paychecks 49622 - 49658 $ 89,366.76 Biweekly Payroll(8/22/12)
Employee Paychecks 49659 - 49667 473.98 Interim Payroll-Supervisor Grade V Pay(8/21/12)
Employee Paychecks 49668 7,781.62 Interim Payroll-Reissue voided Cks 49565&49564(8/20/12)'
Employee Paychecks 49670 2,240.41 Interim Payroll-Tuition Reimbursement(8/21/12)
Employee Paychecks 49671 - 49694 4,025.92 Interim Payroll-ARBA(8/31/12)
Direct Deposit Statements 324925 -325490 1,416,072.09 Biweekly Payroll(8/22/12)
Direct Deposit Statements 325491 -325657 39,081.41 Interim Payroll-ARBA(8/31/12)
Total Payroll Disbursements $ 1,559,042.19 'Check number 49669 not used
Wire Transfer Payments
OCSD Payroll Taxes&Contributions $ 789,154.76 Biweekly Payroll(8/22/12)
Bank of America/Merrill Lynch 17,137.09 Series 2000A&B Refunding COPs Remarketing Fee
J F Shea Construction,Inc. 1,213,301.43 Construction P2-66(08/23/12)
J.F.Shea Construction,Inc. 45,184.85 Construction P2-90(08/23/12)
Total Wire Transfer Payments $ 2,064,778.13
Total Claims Paid 8116/12-8/31112 $ 8,252,787.83
EXHIBIT B
fin/210/mm Page 8 of 8 9/10/2012
Return to Agenda
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: General Counsel
DATE: September 18, 2012
RE: Adoption of Fair Political Practices Commission Form 806 (District Report of
Public Official Appointments)
GENERAL COUNSEL'S RECOMMENDATION
A. Adopt Fair Political Practices Commission ("FPPC") Form 806, which contains
information regarding public official appointments; and
B. Direct the Clerk of the Board to post FPPC Form 806 on the Orange County
Sanitation District's website.
SUMMARY
In March 2012, the FPPC amended the FPPC Regulation (California Code of Regulation,
Title 2) section 18705.5 to allow a public official to participate in a decision to appoint
him/herself to a position that will result in additional compensation, subject to conditions stated
in the regulation. These conditions include:
(1) decision is on his/her appointment as an officer of the body of which he/she is a
member, or to a committee, board, or commission of a public agency, etc.;
(2) appointment is required to be made by the body of which the official is a member
pursuant to either state law, local law, or a joint powers agreement; and
(3) the body making the appointment adopts and posts on its website, on a form approved
by the FPPC, a list that sets forth each appointed position for which compensation is
paid, the salary or stipend for each appointed position, the name of the public official
who has been appointed to the position and the name of the public official, if any,
who has been appointed as an alternate, and the term of the position.
The form referenced in condition #3 above has been designated Form 806. The FPPC
recommends that each public agency prepare and adopt Form 806, identifying all of the
appointments that will result in additional compensation, and post the adopted Form 806 on the
agency's website. The Clerk of the Board has compiled the necessary information, which is
included on the attached Form 806.
ATTACHMENT
FPPC Form 806
879697.1
Agency Report of:
Public Official Appointments A Public Document
1. Agency Name ,
Division, Department, or Region (IfApplicable) For Official Use Only
Designated Agency Contact(Name,Title)
Date Posted:
Area Code/Phone Number E-mail
Page of
(Month,Day,Year)
2. Appointments
Agency Boards and Name of Appointed Person Appt Date and Per Meeting/Annual Salary/Stipend
Commissions Length of Term
1 Per Meeting: $
►Name ►
(Last,First) Appt Date
1 Estimated Annual:
Alternate,if any ► ❑$0-$1,000 ❑$2,001-$3,000
(Last,First) Length of Term
❑$1,001-$2,000 ❑
Other
/ / / /Per Meeting: $
►Name
(Last,First) Appt Data
1 Estimated Annual:
Alternate,if any / ❑$0-$1,000 ❑$2,001-$3,000
(Last,First) Length of Term
❑$1,001-$2,000 ❑
Other
►Name ► I Per Meeting: $
(Last,First) Appt Date
1 Estimated Annual:
Alternate,if any / EI(Last,First) Length of Term $0-$1,000 ❑$2,001-$3,000
❑$1,001-$2,000 ❑
Other
/ / / /Per Meeting: $
►Name
(Last,First) Appt Date
1 Estimated Annual:
Alternate,if any ► ❑$0-$1,000 ❑$2,001-$3,000
(Last,First) Length of Term
❑$1,00142,000 ❑
Other
3. Verification
I have read and understand FPPC Regulation 18705.5.1 have verified that the appointment and information identified above is true to the best of my information and belief.
Signature ofAgency Head or Designee Print Name Title (Month,Day,Year)
Comment:
FPPC Form 806(5/12)
FPPC Toll-Free Helpline:866/ASK-FPPC(866/275-3772)
Calif I
Agency Report of: Form 806
Public Official Appointments
A Public Document
Background 3. Are appointments made by a governing board to appoint
This form is used to report additional compensation that one of its members to serve as an officer of that board for
officials receive when appointing themselves to positions additional pay(e.g. mayor)required to be disclosed on Form
on committees, boards or commissions of a public agency, 806?
special district, and joint powers agency or authority. For Yes. Regulation 18705.5 permits voting on your own
example, a city councilmember may be appointed to serve as appointment to position of mayor as well as other boards and
the city's representative on a joint powers insurance authority commissions so long as proper disclosure on the Form 806 is
or a metropolitan planning organization or mayor. (Regulation made.This exception and disclosure apply to agencies with
18705.5, amended 03.2012) governing boards that are elected or appointed.
Each agency must post on its website a single Form 806 which
lists all the paid appointed positions.When there is a change in 4. In determining the salary, must the agency include mileage
compensation or a new appointment,the Form 806 is updated reimbursements,travel payments, health benefits, and other
to reflect the change. The form must be updated promptly as compensation?
changes occur. No. The FPPC regulation only requires the reporting of the
Initial Agency Posting stipend or salary.
As soon as possible, each agency should prepare a Form 5. Which agency must post the Form 806?
806 identifying all of the current paid appointments to other
governmental agencies. Thereafter,the form may be amended to The agency that is voting to appoint a public official must post
include the future appointments. the Form 806 on its website. The agency that the official will
serve as a member is not required to post the Form 806. The
Instructions form is not sent to the FPPC.
This form must be posted prior to a vote(or consent item)to 6. When must the Form 806 be amended?
appoint a governing board member to a paid position on another
agency. The Form 806 should be amended promptly upon any of
the following circumstances: (1)the number of scheduled
Part 1.Agency Identification meetings is changed, (2)there is a change in the
Identify the agency name and information on who should be compensation paid to the members, or(3)there is a change
contacted for information. in membership on the board or commission.
Part 2. Appointments 7. When a body meets irregularly, how should the annual
Identify the name of the other agency, board or commission. List compensation be estimated?
the name of the official, and an alternate, if any. The agency should estimate compensation using the highest
List the appointment date and the length of term the agency number of meetings.
official will serve. Disclose the stipend provided per meeting and 8. In 2013 our agency will have a new appointment to a new
the estimated annual payment. The annual salary is an estimate agency. How is the Form 806 updated?
as it will likely vary depending on the number of meetings. It is
not necessary to revise the estimate at the end of the calendar Before the agency votes on the appointment,the agency
year. should update the Form 806 and identify the other
governmental entity's name. If known, also include other
Part 3. Verification information such as the number of meetings and stipend.
The agency head or his/her designee must sign the verification. As long as that information is posted prior to a vote of
the governing board on an appointment, the agency is in
Frequently Asked Questions(FAQs) compliance with Regulation 18705.5. Following the vote,the
1. When does an agency need to complete the Form 806? agency must update the form to identify the individual that
will serve.
A Form 806 is required when an agency's board members
vote on an appointment for a board member to serve on
another governmental agency and pay is provided. Privacy Information Notice
Information requested by the FPPC is used to administer and
2. The city council votes to serve as the city's housing authority, enforce the Political Reform Act. Failure to provide information
a separate entity. Will the Form 806 be required? may be a violation subject to penalties. All reports are public
If the council members receive an additional compensation records available for inspection and reproduction. Direct
for serving on the housing authority,the Form 806 is required. questions to FPPC's General Counsel. Fair Political Practices
If there is no payment, the Form 806 is not required. Commission,428 J Street, Ste. 620, Sacramento, CA 95814.
FPPC Form 806(5/12)
FPPC Toll-Free Helpline:866/ASK-FPPC(866/275-3772)
Return to Agenda
BOARD OF DIRECTORS Meeting Date To Bd. of Dir.
09/26/12
AGENDA REPORT Item Number Item Number
5
Orange County Sanitation District
FROM: James D. Ruth, General Manager
Originator: Jim Herberg, Assistant General Manager
CIP Project Manager: Umesh Murthy
SUBJECT: DIGESTER FERRIC CHLORIDE SYSTEM REHABILITATION,
PROJECT NO. P2-105 REBID
GENERAL MANAGER'S RECOMMENDATION
A. Approve Plans and Specifications for Digester Ferric Chloride System
Rehabilitation, Project No. P2-105 Rebid, on file at the office of the Clerk of the
Board;
B. Approve Addendum Nos. 1 and 2 to the plans and specifications;
C. Receive and file bid tabulation and recommendation;
D. Receive and file Award Protest dated September 13, 2012 from Environmental
Construction, Inc. concerning the award to ODC Engineering and Technology;
E. Receive and file letter dated September 19, 2012 to Environmental Construction,
Inc. responding to the Award Protest;
F. Reject Award Protest filed by Environmental Construction, Inc.;
G. Award a construction contract to ODC Engineering and Technology for Digester
Ferric Chloride System Rehabilitation, Project No. P2-105 Rebid, for a total
amount not to exceed $1,694,000; and,
H. Approve a contingency of $169,400 (10%).
SUMMARY
Digester Ferric Chloride System Rehabilitation, Project No. P2-105 Rebid, will replace
the existing ferric chloride station and associated pipelines at Plant No. 2. The project
also includes upgrades to the instrumentation and control systems that are currently
operated manually.
The Orange County Sanitation District (Sanitation District) advertised for bids on
April 3, 2012. Seven sealed bids were received on May 10, 2012. The bids were
evaluated in accordance with the Sanitation District's policies and procedures. Based
on the evaluation of bids and staff recommendations, the Board of Directors at its
meeting on June 27, 2012 approved the following actions:
Page 1 of 3
( Reject all bids
( Revise the minimum percentage of work self-performed by the Contractor
( Rebid the project in July 2012
The project was re-advertised for bids July 17, 2012. Three sealed bids were received
on August 21, 2012. ODC Engineering and Technology was deemed the lowest
responsive, responsible bidder. Staff recommends awarding a construction contract to
ODC Engineering and Technology for Digester Ferric Chloride System Rehabilitation,
Project No. P2-105 Rebid, for a total amount not to exceed $1,694,000.
Summary information on the bid opening for Digester Ferric Chloride System
Rehabilitation, Project No. P2-105 Rebid, is as follows:
Project Budget $3,689,500
Construction Contract Budget $2,000,000
Engineer's Estimate $2,000,000
Lowest Responsive, Responsible Bid $1,694,000
High Bid $2,531,500
Bidder Amount of Bid
ODC Engineering and Technology $1,694,000
Environmental Construction, Inc. $2,408,700
Metro Builders and Engineers Group $2,531,500
Environmental Construction, Inc. sent a formal protest of the award to the Sanitation
District following the bid evaluation and notification of award recommendation. The
Sanitation District reviewed and responded to this protest and the protest does not merit
a change to the award recommendation.
PRIOR COMMITTEE/BOARD ACTIONS
June 27, 2012 — Rejected all bids for the construction of Digester Ferric Chloride
System Rehabilitation, Project No. P2-105, and directed staff to re-advertise.
December 21, 2011 — Approved a budget increase of $784,000 for Digester Ferric
Chloride System Rehabilitation, Project Number P2-105, for a total budget amount of
$3,689,500.
ADDITIONAL INFORMATION
None.
CEQA
The recommended action is categorically exempt pursuant to CEQA Guidelines,
Sections 15301, because it consists of the operation, repair, maintenance, permitting
and/or minor alteration of existing public structures, facilities, and/or mechanical
equipment, involving no expansion of use beyond that currently existing. A Notice of
Exemption has been filed with the County of Orange on August 3, 2010.
Page 2 of 3
BUDGET/DELEGATION OF AUTHORITY COMPLIANCE
This recommendation complies with authority levels of the Sanitation District's
Delegation of Authority. This item has been budgeted (FY2012-13 Update, Section 8,
Page 56), and is sufficient for the recommended action.
Date of Approval Contract Amount Contingency
09/26/12 $1,694,000 $169,400 (10%)
ATTACHMENTS:
( Environmental Construction, Inc. Protest Letter
( OCSD Response to Protest Letter
The following attachment(s) may be viewed on-line at OCSD website with complete agenda package and
attachments:
( Contract Agreement
JH:UM:cb:gc
Page 3 of 3
PART A
CONTRACT AGREEMENT
C-CA-071012
TABLE OF CONTENTS
CONTRACT AGREEMENT
SECTION - 1 GENERAL CONDITIONS.................................................................. 1
SECTION - 2 MATERIALS AND LABOR.................................................................4
SECTION - 3 PROJECT..........................................................................................5
SECTION -4 PLANS AND SPECIFICATONS ........................................................5
SECTION - 5 TIME OF COMMENCEMENT AND COMPLETION ..........................5
SECTION - 6 TIME IS OF THE ESSENCE .............................................................6
SECTION - 7 EXCUSABLE DELAYS......................................................................6
SECTION - 8 EXTRA WORK...................................................................................7
SECTION - 9 CHANGES IN PROJECT...................................................................7
SECTION - 10 LIQUIDATED DAMAGES FOR DELAY.............................................8
SECTION - 11 CONTRACT PRICE AND METHOD OF PAYMENT .........................8
SECTION - 12 SUBSTITUTION OF SECURITIES IN LIEU OF RETENTION OF
FUNDS ............................................................................................10
SECTION - 13 COMPLETION................................................................................. 10
SECTION - 14 CONTRACTOR'S EMPLOYEES COMPENSATION....................... 11
SECTION - 15 SURETY BONDS ............................................................................ 13
SECTION - 16 INSURANCE....................................................................................14
SECTION - 17 RISK AND INDEMNIFICATION....................................................... 15
SECTION - 18 TERMINATION................................................................................ 15
SECTION - 19 WARRANTY....................................................................................16
SECTION - 20 ASSIGNMENT................................................................................. 17
SECTION - 21 RESOLUTION OF DISPUTES ........................................................17
SECTION - 22 SAFETY & HEALTH ........................................................................17
SECTION - 23 NOTICES.........................................................................................18
C-CA-071012
CONTRACT AGREEMENT
ORANGE COUNTY SANITATION DISTRICT
PROJECT NO. P2-105 REBID
DIGESTER FERRIC CHLORIDE SYSTEM REHABILITATION
THIS AGREEMENT is made and entered into, to be effective, this September 26, 2012, by and
between ODC Engineering & Technology, hereinafter referred to as "CONTRACTOR" and the
Orange County Sanitation District, hereinafter referred to as "OCSD".
WITNESSETH
That for and in consideration of the promises and agreements hereinafter made and exchanged,
OCSD and CONTRACTOR agree as follows:
SECTION — 1 GENERAL CONDITIONS
CONTRACTOR certifies and agrees that all the terms, conditions and obligations of the
Contract Documents as hereinafter defined, the location of the job site, and the conditions under
which the Work is to be performed have been thoroughly reviewed, and enters into this Contract
based upon CONTRACTOR's investigation of all such matters and is in no way relying upon
any opinions or representations of OCSD. It is agreed that this Contract represents the entire
agreement. It is further agreed that the Contract Documents are each incorporated into this
Contract by reference, with the same force and effect as if the same were set forth at length
herein, and that CONTRACTOR and its Subcontractors, if any, will be and are bound by any
and all of said Contract Documents insofar as they relate in any part or in any way, directly or
indirectly, to the Work covered by this Contract.
C-CA-071012
PROJECT NO. P2-105 REBID
DIGESTER FERRIC CHLORIDE SYSTEM REHABILITATION
CONFORMED SEPTEMBER 26, 2012
Page 1 of 19
A. Contract Documents Order of Precedence
"Contract Documents" refers to those documents identified in the definition of"Contract
Documents" in the General Conditions - Definitions.
1. In the event of a conflict between one Contract Document and any of the other
Contract Documents, the provisions in the document highest in precedence shall
be controlling. The order of precedence of the Contract Documents is as follows:
a. Supplemental Agreements - the last in time being the first in precedence
b. Addenda issued prior to opening of Bids - the last in time being the first in
precedence
C. Contract Agreement
i. OCIP Insurance policies
ii. Exhibit B
iii. Exhibit C OCIP Insurance Manual
iv. Exhibit D OCIP Safety Standards
V. Other provisions of the Contract Agreement
d. Permits and other regulatory requirements
e. Special Provisions
f. General Conditions (GC)
g. Notice Inviting Bids and Instruction to Bidders
h. Geotechnical Baseline Report (GBR), if attached as a Contract Document
i. Plans and Specifications - in these documents the order of precedence shall
be:
i. Specifications (Divisions 01-17)
ii. Plans
C-CA-071012
PROJECT NO. P2-105 REBID
DIGESTER FERRIC CHLORIDE SYSTEM REHABILITATION
CONFORMED SEPTEMBER 26, 2012
Page 2 of 19
iii. General Requirements (GR)
iv. Standard Drawings and Typical Details
j. CONTRACTOR's Bid
2. In the event of a conflict between terms within an individual Contract Document,
the conflict shall be resolved by applying the following principles as appears
applicable:
a. Figured dimensions on the Contract Documents shall govern. Dimensions
not specified shall be as directed by the ENGINEER. Details not shown or
specified shall be the same as similar parts that are shown or specified, or as
directed. Full-size details shall take precedence over scale Drawings as to
shape and details of construction. Specifications shall govern as to material
and workmanship.
b. The Contract Documents calling for the higher quality material or
workmanship shall prevail. Materials or Work described in words, which so
applied, have a well known technical or trade meaning shall be deemed to
refer to such recognized standards. In the event of any discrepancy between
any Drawings and the figures thereon, the figures shall be taken as correct.
C. Scale Drawings, full-size details, and Specifications are intended to be fully
complementary and to agree. Should any discrepancy between Contract
Documents come to the CONTRACTOR's attention, or should an error occur
in the efforts of others, which affect the Work, the CONTRACTOR shall notify
the ENGINEER, in writing, at once. In the event any doubts or questions
arise with respect to the true meaning of the Contract Documents, reference
shall be made to the ENGINEER whose written decision shall be final. If the
C-CA-071012
PROJECT NO. P2-105 REBID
DIGESTER FERRIC CHLORIDE SYSTEM REHABILITATION
CONFORMED SEPTEMBER 26, 2012
Page 3 of 19
CONTRACTOR proceeds with the Work affected without written instructions
from the ENGINEER, the CONTRACTOR shall be fully responsible for any
resultant damage or defect.
d. Anything mentioned in the Specifications and not indicated in the Plans, or
indicated in the Plans and not mentioned in the Specifications, shall be of like
effect as if indicated and mentioned in both. In case of discrepancy in the
Plans or Specifications, the matter shall be immediately submitted to OCSD's
ENGINEER, without whose decision CONTRACTOR shall not adjust said
discrepancy save only at CONTRACTOR's own risk and expense. The
decision of the ENGINEER shall be final.
In all matters relating to the acceptability of material, machinery or plant equipment;
classifications of material or Work; the proper execution, progress or sequence of the
Work; and quantities interpretation of the Contract Documents, the decision of the
ENGINEER shall be final and binding, and shall be a condition precedent to any
payment under the Contract, unless otherwise ordered by the Board of Directors.
B. Definitions
Capitalized terms used in this Contract are defined in the General Conditions,
Definitions. Additional terms may be defined in the Special Provisions.
SECTION — 2 MATERIALS AND LABOR
CONTRACTOR shall furnish, under the conditions expressed in the Plans and Specifications, at
CONTRACTOR'S own expense, all labor and materials necessary, except such as are
mentioned in the Specifications to be furnished by OCSD, to construct and complete the
Project, in good workmanlike and substantial order. If CONTRACTOR fails to pay for labor or
materials when due, OCSD may settle such claims by making demand upon the Surety to this
C-CA-071012
PROJECT NO. P2-105 REBID
DIGESTER FERRIC CHLORIDE SYSTEM REHABILITATION
CONFORMED SEPTEMBER 26, 2012
Page 4 of 19
Contract. In the event of the failure or refusal of the Surety to satisfy said claims, OCSD may
settle them directly and deduct the amount of payments from the Contract Price and any
amounts due to CONTRACTOR. In the event OCSD receives a stop payment notice from any
laborer or material supplier alleging non-payment by CONTRACTOR, OCSD shall be entitled to
deduct all of its costs and expenses incurred relating thereto, including but not limited to
administrative and legal fees.
SECTION — 3 PROJECT
The Project is described as:
PROJECT NO. P2-105 REBID
DIGESTER FERRIC CHLORIDE SYSTEM REHABILITATION
SECTION —4 PLANS AND SPECIFICATONS
The Work to be done is shown in a set of Plans and Specifications entitled:
PROJECT NO. P2-105 REBID
DIGESTER FERRIC CHLORIDE SYSTEM REHABILITATION
Said Plans and Specifications and any revision, amendments and addenda thereto are attached
hereto and incorporated herein as part of this Contract and referred to by reference.
SECTION — 5 TIME OF COMMENCEMENT AND COMPLETION
CONTRACTOR agrees to commence the Project within 15 calendar days from the date set forth
in the "Notice to Proceed" sent by OCSD, unless otherwise specified therein and shall diligently
prosecute the Work to completion within 450 calendar days from the date of the "Notice to
Proceed" issued by OCSD, excluding delays caused or authorized by OCSD as set forth in
Sections 7, 8, and 9 hereof, and applicable provisions in the General Conditions. The time for
C-CA-071012
PROJECT NO. P2-105 REBID
DIGESTER FERRIC CHLORIDE SYSTEM REHABILITATION
CONFORMED SEPTEMBER 26, 2012
Page 5 of 19
completion includes 20 calendar days determined by OCSD likely to be inclement weather when
CONTRACTOR will be unable to work.
In addition, CONTRACTOR shall accomplish such milestones within the periods of performance
set forth in Appendix A of the Special Provisions entitled "Work Completion Schedule."
SECTION — 6 TIME IS OF THE ESSENCE
Time is of the essence of this Contract. As required by the Contract Documents,
CONTRACTOR shall prepare and obtain approval of all shop drawings, details and samples,
and do all other things necessary and incidental to the prosecution of CONTRACTOR's Work in
conformance with an approved construction progress schedule. CONTRACTOR shall
coordinate the Work covered by this Contract with that of all other contractors, subcontractors
and of OCSD, in a manner that will facilitate the efficient completion of the entire Work and
accomplish the required milestone(s), if any, by the applicable deadline(s) in accordance with
Section 5 herein. OCSD shall have the right to assert complete control of the premises on
which the Work is to be performed and shall have the right to decide the time or order in which
the various portions of the Work shall be installed or the priority of the work of subcontractors,
and, in general, all matters representing the timely and orderly conduct of the Work of
CONTRACTOR on the premises.
SECTION — 7 EXCUSABLE DELAYS
CONTRACTOR shall only be excused for any delay in the prosecution or completion of the
Project as specifically provided in General Conditions, "Extensions for Delay", and the General
Requirements, "By CONTRACTOR or Others - Unknown Utilities during Contract Work".
Extensions of time and extra compensation arising from such excusable delays will be
determined in accordance with the General Conditions, "Extension of Time for Delay" and
"Contract Price Adjustments and Payments", and extensions of time and extra compensation as
C-CA-071012
PROJECT NO. P2-105 REBID
DIGESTER FERRIC CHLORIDE SYSTEM REHABILITATION
CONFORMED SEPTEMBER 26, 2012
Page 6 of 19
a result of incurring undisclosed utilities will be determined in accordance with General
Requirements, "By CONTRACTOR or Others - Unknown Utilities during Contract Work".
OCSD's decision will be conclusive on all parties to this Contract.
SECTION — 8 EXTRA WORK
The Contract Price as set forth in Section 11, includes compensation for all Work performed by
CONTRACTOR, unless CONTRACTOR obtains a Change Order signed by a designated
representative of OCSD specifying the exact nature of the Extra Work and the amount of extra
compensation to be paid all as more particularly set forth in Section 9 hereof and the General
Conditions, "Request for Change (Changes at CONTRACTOR's Request)", "OWNER Initiated
Changes", and "Contract Price Adjustments and Payments".
In the event a Change Order is issued by OCSD pursuant to the Contract Documents, OCSD
shall extend the time fixed in Section 5 for completion of the Project by the number of days, if
any, reasonably required for CONTRACTOR to perform the Extra Work, as determined by
OCSD's ENGINEER. The decision of the ENGINEER shall be final.
SECTION — 9 CHANGES IN PROJECT
OCSD may at any time, without notice to any Surety, by Change Order, make any changes in the
Work within the general scope of the Contract Document, including but not limited to changes:
1. In the Specifications (including Drawings and designs);
2. In the time, method or manner of performance of the Work;
3. In OCSD-furnished facilities, equipment, materials, services or site; or
4. Directing acceleration in the performance of the Work.
No change of period of performance or Contract Price, or any other change in the Contract
Documents, shall be binding until the Contract is modified by a fully executed Change Order.
C-CA-071012
PROJECT NO. P2-105 REBID
DIGESTER FERRIC CHLORIDE SYSTEM REHABILITATION
CONFORMED SEPTEMBER 26, 2012
Page 7 of 19
All Change Orders shall be issued in accordance with the requirements set forth in the General
Conditions, "Request for Change (Changes at CONTRACTOR's Request)" and "OWNER
Initiated Changes".
SECTION — 10 LIQUIDATED DAMAGES FOR DELAY
Liquidated Damages shall be payable in the amounts and upon the occurrence of such events
or failure to meet such requirements or deadlines as provided in the Special Provisions,
"Liquidated Damages and Incentives."
SECTION — 11 CONTRACT PRICE AND METHOD OF PAYMENT
A. OCSD agrees to pay and the CONTRACTOR agrees to accept as full consideration for
the faithful performance of this Contract, subject to any additions or deductions as
provided in approved Change Orders, the sum of One Million Six Hundred Ninety-Four
Thousand Dollars ($1,694,000) as itemized on the Attached Exhibit "A".
Upon satisfaction of the conditions precedent to payment set forth in the General
Requirements, Additional General Requirements and General Conditions (including but
not limited to Sections entitled "Mobilization Payment Requirements" and "Payment
Itemized Breakdown of Contract Lump Sum Prices"), there shall be paid to the
CONTRACTOR an initial Net Progress Payment for mobilization. OCSD shall issue at
the commencement of the job a schedule which shows:
1. A minimum of one payment to be made to the CONTRACTOR for each successive
four (4) week period as the Work progresses, and
2. The due dates for the CONTRACTOR to submit requests for payment to meet the
payment schedule.
C-CA-071012
PROJECT NO. P2-105 REBID
DIGESTER FERRIC CHLORIDE SYSTEM REHABILITATION
CONFORMED SEPTEMBER 26, 2012
Page 8 of 19
After the initial Net Progress Payment, and provided the CONTRACTOR submits the
request for payment prior to the end of the day required to meet the payment schedule,
the CONTRACTOR shall be paid a Net Progress Payment on the corresponding monthly
payment date set forth in the schedule.
Payments shall be made on demands drawn in the manner required by law,
accompanied by a certificate signed by the ENGINEER, stating that the Work for which
payment is demanded has been performed in accordance with the terms of the Contract
Documents, and that the amount stated in the certificate is due under the terms of the
Contract. Payment applications shall also be accompanied with all documentation,
records, and releases as required by the Contract, Exhibit A, Schedule of Prices, and
General Conditions, "Payment for Work- General". The Total amount of Progress
Payments shall not exceed the actual value of the Work completed as certified by
OCSD's ENGINEER. The processing of payments shall not be considered as an
acceptance of any part of the Work.
B. As used in this Section, the following defined terms shall have the following meanings:
1. "Net Progress Payment" means a sum equal to the Progress Payment less the
Retention Amount and other qualified deductions (Liquidated Damages, stop
payment notices, etc.).
2. "Progress Payment" means a sum equal to:
a. the value of the actual Work completed since the commencement of the Work
as determined by OCSD;
b. plus the value of material suitably stored at the worksite, treatment plant or
approved storage yards subject to or under the control of OCSD since the
commencement of the Work as determined by OCSD;
C-CA-071012
PROJECT NO. P2-105 REBID
DIGESTER FERRIC CHLORIDE SYSTEM REHABILITATION
CONFORMED SEPTEMBER 26, 2012
Page 9 of 19
C. less all previous Net Progress Payments;
d. less all amounts of previously qualified deductions;
e. less all amounts of OCIP payments for the CONTRACTOR's obligation,
OCIP-related costs and OCIP penalties assessed as specified in the General
Conditions;
f. less all amounts previously retained as Retention Amounts.
3. "Retention Amount" for each Progress Payment means the percentage of each
Progress Payment to be retained by OCSD to assure satisfactory completion of the
Contract. The amount to be retained from each Progress Payment shall be
determined as provided in the General Conditions - "Retained Funds; Substitution
of Securities."
SECTION — 12 SUBSTITUTION OF SECURITIES IN LIEU OF RETENTION OF FUNDS
Pursuant to Public Contract Code Section 22300 et seq., the CONTRACTOR may, at its sole
expense, substitute securities as provided in General Conditions - "Retained Funds; Substitution
of Securities."
SECTION — 13 COMPLETION
Final Completion and Final Acceptance shall occur at the time and in the manner specified in
the General Conditions, "Final Acceptance and Final Completion" and "Final Payment". Upon
receipt of CONTRACTOR's affidavit, and all documentation, records, and releases as required
by the Contract, OCSD shall proceed with the Final Acceptance as specified in General
Conditions.
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SECTION — 14 CONTRACTOR'S EMPLOYEES COMPENSATION
A. Davis-Bacon Act:
CONTRACTOR will pay and will require all Subcontractors to pay all employees on said
Project a salary or wage at least equal to the prevailing rate of per diem wages as
determined by the Secretary of Labor in accordance with the Davis-Bacon Act for each
craft or type of worker needed to perform the Contract. The provisions of the Davis-
Bacon Act shall apply only if the Contract is in excess of Two Thousand Dollars
($2,000.00) and when twenty-five percent (25%) or more of the Contract is funded by
federal assistance. If the aforesaid conditions are met, a copy of the provisions of the
Davis-Bacon Act to be complied with are incorporated herein as a part of this Contract
and referred to by reference.
B. General Prevailing Rate:
OCSD has been advised by the State of California Director of Industrial Relations of its
determination of the general prevailing rate of per diem wages and the general prevailing
rate for legal holiday and overtime Work in the locality in which the Work is to be
performed for each craft or type of Work needed to execute this Contract, and copies of
the same are on file in the Office of the ENGINEER of OCSD. The CONTRACTOR
agrees that not less than said prevailing rates shall be paid to workers employed on this
public works Contract as required by Labor Code Section 1774 of the State of California.
Per California Labor Code 1773.2, OCSD will have on file copies of the prevailing rate of
per diem wages at its principal office and at each job site, which shall be made available
to any interested party upon request.
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C. Forfeiture for Violation:
CONTRACTOR shall, as a penalty to OCSD, forfeit Two Hundred Dollars ($200.00) for
each calendar day or portion thereof for each worker paid (either by the CONTRACTOR
or any Subcontractor under it) less than the prevailing rate of per diem wages as set by
the Director of Industrial Relations, in accordance with Sections 1770-1780 of the
California Labor Code for the Work provided for in this Contract, all in accordance with
Section 1775 of the Labor Code of the State of California.
D. Apprentices:
Sections 1777.5, 1777.6, 1777.7 of the Labor Code of the State of California, regarding
the employment of apprentices are applicable to this Contract and the CONTRACTOR
shall comply therewith if the prime contract involves Thirty Thousand Dollars
($30,000.00) or more.
E. Workday:
In the performance of this Contract, not more than eight (8) hours shall constitute a day's
work, and the CONTRACTOR shall not require more than eight (8) hours of labor in a
day from any person employed by him hereunder except as provided in paragraph (B)
above. CONTRACTOR shall conform to Article 3, Chapter 1, Part 7 (Section 1810 et
sec..) of the Labor Code of the State of California and shall forfeit to OCSD as a penalty,
the sum of Twenty-five Dollars ($25.00) for each worker employed in the execution of
this Contract by CONTRACTOR or any Subcontractor for each calendar day during
which any worker is required or permitted to labor more than eight (8) hours in any one
calendar day and forty (40) hours in any one week in violation of said Article.
CONTRACTOR shall keep an accurate record showing the name and actual hours
worked each calendar day and each calendar week by each worker employed by
CONTRACTOR in connection with the Project.
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F. Record of Wages; Inspection:
CONTRACTOR agrees to maintain accurate payroll records showing the name,
address, social security number, work classification, straight-time and overtime hours
worked each day and week, and the actual per diem wages paid to each journeyman,
apprentice, worker or other employee employed by it in connection with the Project and
agrees to require that each of its Subcontractors do the same. All payroll records shall
be certified as accurate by the applicable CONTRACTOR or Subcontractor or its agent
having authority over such matters.
CONTRACTOR further agrees that its payroll records and those of its Subcontractors
shall be available to the employee or employee's representative, the Division of Labor
Standards Enforcement, and the Division of Apprenticeship Standards and shall comply
with all of the provisions of Labor Code Section 1776, in general. Penalties for non-
compliance with the requirements of Section 1776 may be deducted from Project
payments per the requirements of Section 1776.
SECTION — 15 SURETY BONDS
CONTRACTOR shall, before entering upon the performance of this Contract, furnish Bonds
approved by OCSD's General Counsel —one in the amount of one hundred percent (100%) of
the Contract amount, to guarantee the faithful performance of the Work, and the other in the
amount of one hundred percent (100%) of the Contract amount to guarantee payment of all
claims for labor and materials furnished. As changes to the Contract occur via approved
Change Orders, the CONTRACTOR shall assure that the amounts of the Bonds are adjusted to
maintain 100% of the Contract Price. This Contract shall not become effective until such Bonds
are supplied to and approved by OCSD. Bonds must be issued by a Surety authorized by the
State Insurance Commissioner to do business in California. The Performance Bond shall
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remain in full force and effect through the warranty period, as specified in Section 19 below. All
Bonds required to be submitted relating to this Contract must comply with California Code of
Civil Procedure Section 995.630. Each Bond shall be executed in the name of the Surety
insurer under penalty of perjury, or the fact of execution of each Bond shall be duly
acknowledged before an officer authorized to take and certify acknowledgments, and either one
of the following conditions shall be satisfied:
A. A copy of the transcript or record of the unrevoked appointment, power of attorney, by-
laws, or other instrument, duly certified by the proper authority and attested by the seal of
the insurer entitling or authorizing the person who executed the Bond to do so for and on
behalf of the insurer, is on file in the Office of the County Clerk of the County of Orange; or
B. A copy of a valid power of attorney is attached to the Bond.
SECTION — 16 INSURANCE
CONTRACTOR shall not commence Work under this Contract until it enrolls in the Owner
Controlled Insurance Program (OCIP) and all additional insurance as required by the Contract
Exhibit B and Exhibit C is obtained in a form acceptable to OCSD, nor shall CONTRACTOR allow
any Subcontractor to commence Work on a subcontract until each eligible Subcontractor enrolls
in the OCIP and all additional insurance required of the Subcontractor by the Contract, Exhibit B
and Exhibit C has been obtained. CONTRACTOR shall maintain all of the additional insurance
coverages in force through the point at which the Work under this Contract is fully completed and
accepted by OCSD pursuant to the provisions of the General Conditions, "Final Acceptance and
Final Completion". Furthermore, CONTRACTOR shall maintain all of the additional insurance
coverages in full force and effect throughout the warranty period, commencing on the date of Final
Acceptance. The requirement for carrying the additional insurance shall not derogate from the
provisions for indemnification of OCSD by CONTRACTOR under Section 17 of this Contract.
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CONTRACTOR's additional insurance shall also comply with all insurance requirements
prescribed by agencies from whom permits shall be obtained for the Work and any other third
parties from whom third party agreements are necessary to perform the Work (collectively, the
"Third Parties"), The Special Provisions may list such requirements and sample forms and
requirements from such Third Parties may be included in an attachment to the General
Requirements. CONTRACTOR bears the responsibility to discover and comply with all
requirements of Third Parties, including meeting specific insurance requirements, which are
necessary for the complete performance of the Work. To the extent there is a conflict between
the Third Parties' insurance requirements and those set forth by OCSD herein, the
requirement(s) providing the more protective coverage for both OSCD and the Third Parties
shall control and be purchased and maintained by CONTRACTOR.
SECTION — 17 RISK AND INDEMNIFICATION
All Work covered by this Contract done at the site of construction or in preparing or delivering
materials to the site shall be at the risk of CONTRACTOR alone. CONTRACTOR shall save,
indemnify, defend, and keep OCSD and others harmless as more specifically set forth in
General Conditions, "General Indemnification".
SECTION — 18 TERMINATION
This Contract may be terminated in whole or in part in writing by OCSD in the event of
substantial failure by the CONTRACTOR to fulfill its obligations under this Agreement, or it
may be terminated by OCSD for its convenience provided that such termination is effectuated
in a manner and upon such conditions set forth more particularly in General Conditions,
"Termination for Default" and/or "Termination for Convenience", provided that no termination
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may be effected unless proper notice is provided to CONTRACTOR at the time and in the
manner provided in said General Conditions. If termination for default or convenience is
effected by OCSD, an equitable adjustment in the price provided for in this Contract shall be
made at the time and in the manner provided in the General Conditions, "Termination for
Default" and "Termination for Convenience".
SECTION — 19 WARRANTY
The CONTRACTOR agrees to perform all Work under this Contract in accordance with the
Contract Documents, including OCSD's designs, Drawings and Specifications.
The CONTRACTOR guarantees for a period of at least one (1) year from the date of Final
Acceptance of the Work, pursuant to the General Conditions, "Final Acceptance and Final
Completion" that the completed Work is free from all defects due to faulty materials, equipment
or workmanship and that it shall promptly make whatever adjustments or corrections which may
be necessary to cure any defects, including repairs of any damage to other parts of the system
resulting from such defects. OCSD shall promptly give notice to the CONTRACTOR of
observed defects. In the event that the CONTRACTOR fails to make adjustments, repairs,
corrections or other work made necessary by such defects, OCSD may do so and charge the
CONTRACTOR the cost incurred. The CONTRACTOR's warranty shall continue as to any
corrected deficiency until the later of (1) the remainder of the original one-year warranty period;
or (2) one year after acceptance by OCSD of the corrected Work. The Performance Bond and
the Payment Bond shall remain in full force and effect through the guarantee period.
The CONTRACTOR's obligations under this clause are in addition to the CONTRACTOR's
other express or implied assurances under this Contract, including but not limited to specific
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manufacturer or other extended warranties specified in the Plans and Specifications, or state
law and in no way diminish any other rights that OCSD may have against the CONTRACTOR
for faulty materials, equipment or Work.
SECTION — 20 ASSIGNMENT
No assignment by the CONTRACTOR of this Contract or any part hereof, or of funds to be
received hereunder, will be recognized by OCSD unless such assignment has had prior written
approval and consent of OCSD and the Surety.
SECTION — 21 RESOLUTION OF DISPUTES
OCSD and the CONTRACTOR shall comply with the provisions of California Public Contract
Code Section 20104 et. seq., regarding resolution of construction claims for any Claims which
arise between the CONTRACTOR and OCSD, as well as all applicable dispute and Claims
provisions as set forth in the General Conditions and as otherwise required by law. This Section
does not apply to any OCIP-related claims.
SECTION — 22 SAFETY & HEALTH
CONTRACTOR shall comply with all applicable safety and health requirements mandated by
federal, state, city and/or public agency codes, permits, ordinances, regulations, and laws, as
well as these Contract Documents, including but not limited to the General Requirements
Section entitled "Safety" and Exhibit D, OCIP Safety Standards.
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SECTION — 23 NOTICES
Any notice required or permitted under this Contract may be given by ordinary mail at the
address set forth below. Any party whose address changes shall notify the other party in
writing.
TO OCSD: Orange County Sanitation District
10844 Ellis Avenue
Fountain Valley, California 92708-7018
Attn: Clerk of the Board
Copy to: Orange County Sanitation District
10844 Ellis Avenue
Fountain Valley, California 92708-7018
Attn: Construction Manager
Bradley R. Hogin, Esquire
Woodruff, Spradlin & Smart
555 Anton Boulevard
Suite 1200
Costa Mesa, California 92626
TO CONTRACTOR: ODC Engineering & Technology
5675 Walnut Ridge Drive
Agoura, CA 91301
Copy to: Oved Dagan, President
ODC Engineering & Technology
5675 Walnut Ridge Drive
Agoura, CA 91301
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PROJECT NO. P2-105 REBID
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CONFORMED SEPTEMBER 26, 2012
Page 18 of 19
IN WITNESS WHEREOF, the parties hereto have executed this Contract Agreement as the
date first hereinabove written.
Approved as to Form:
Marc Dubois
Contracts, Purchasing and Materials
Management Division Manager
CONTRACTOR: ODC Engineering & Technology
5675 Walnut Ridge Drive
Agoura, CA 91301
By
Its
CONTRACTOR's State License No. 822239 (Expiration Date — 7/31/2013)
OCSD: Orange County Sanitation District
By
Chair, Board of Directors
By
Clerk of the Board
By
Marc Dubois
Contracts, Purchasing and Materials
Management Division Manager
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PROJECT NO. P2-105 REBID
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CONFORMED SEPTEMBER 26, 2012
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EXHIBIT A
SCHEDULE OF PRICES
C-EXA-071012
TABLE OF CONTENTS
EXHIBIT A
SCHEDULE OF PRICES
EXA-1 BASIS OF COMPENSATION .............................................................................. 1
EXA-2 PROGRESS PAYMENTS.................................................................................... 1
EXA-3 RETENTION AND ESCROW ACCOUNTS ......................................................... 1
EXA-4 STOP PAYMENT NOTICE ..................................................................................3
EXA-5 PAYMENT TO SUBCONTRACTORS..................................................................3
EXA-6 PAYMENT OF TAXES.........................................................................................3
EXA-7 FINAL PAYMENT ................................................................................................4
EXA-8 DISCOVERY OF DEFICIENCIES BEFORE AND AFTER FINAL PAYMENT.....6
ATTACHMENT 1 CERTIFICATION FOR REQUEST FOR PAYMENT........................7
ATTACHMENT 2 SCHEDULE OF PRICES ...........................................................8
C-EXA-071012
EXHIBIT A
SCHEDULE OF PRICES
EXA-1 BASIS OF COMPENSATION
CONTRACTOR will be paid the Contract Document price according to the
Schedule of Prices, and all other applicable terms and conditions of the
Contract Documents.
EXA-2 PROGRESS PAYMENTS
Progress payments will be made in accordance with all applicable terms and
conditions of the Contract Documents, including, but not limited to:
1. Contract Agreement— Section 11 — "Contract Price and Method of
Payment;"
2. General Conditions —"Payment— General";
3. General Conditions—"Payment—Applications for Payment";
4. General Conditions — "Payment— Mobilization Payment Requirements;"
5. General Conditions — "Payment— Itemized Breakdown of Contract Lump
Sum Prices";
6. General Conditions— "Contract Price Adjustments and Payments";
7. General Conditions— "Suspension of Payments";
8. General Conditions— "OCSD's Right to Withhold Certain Amounts and
Make Application Thereof'; and
9. General Conditions — "Final Payment."
EXA-3 RETENTION AND ESCROW ACCOUNTS
A. Retention:
OCSD shall retain a percentage of each progress payment to assure
satisfactory completion of the Work. The amount to be retained from each
progress payment shall be determined as provided in General Conditions —
"Retained Funds; Substitution of Securities". In all contracts between
CONTRACTOR and its Subcontractors and/or Suppliers, the retention may not
exceed the percentage specified in the Contract Documents.
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PROJECT NO. P2-105 REBID
DIGESTER FERRIC CHLORIDE SYSTEM REHABILITATION
CONFORMED SEPTEMBER 26, 2012
Page 1 of 8
B. Substitution of Securities:
CONTRACTOR may, at its sole expense, substitute securities as provided in
General Conditions—"Retained Funds; Substitution of Securities." Payment of
Escrow Agent:
In lieu of substitution of securities as provided above, the CONTRACTOR may
request and OCSD shall make payment of retention earned directly to the
escrow agent at the expense of the CONTRACTOR. At the expense of the
CONTRACTOR, the CONTRACTOR may direct the investment of the
payments into securities consistent with Government Code §16430 and the
CONTRACTOR shall receive the interest earned on the investments upon the
same terms provided for in this article for securities deposited by the
CONTRACTOR. Upon satisfactory completion of the Contract, the
CONTRACTOR shall receive from the escrow agent all securities, interest and
payments received by the escrow agent from OCSD, pursuant to the terms of
this article. The CONTRACTOR shall pay to each Subcontractor, not later than
twenty (20) calendar days after receipt of the payment, the respective amount
of interest earned, net of costs attributed to retention withheld from each
Subcontractor, on the amount of retention withheld to ensure the performance
of the Subcontractor. The escrow agreement used by the escrow agent
pursuant to this article shall be substantially similar to the form set forth in
§22300 of the California Public Contract Code.
C. Release of Retention:
Upon Final Acceptance of the Work, the CONTRACTOR shall submit an
invoice for release of retention in accordance with the terms of the Contract.
D. Additional Deductions:
In addition to the retentions described above, OCSD may deduct from each
progress payment any or all of the following:
1. Liquidated Damages that have occurred as of the date of the application for
progress payment;
2. Deductions from previous progress payments already paid, due to OCSD's
discovery of deficiencies in the Work or non-compliance with the
Specifications or any other requirement of the Contract;
3. Sums expended by OCSD in performing any of the CONTRACTOR'S
obligations under the Contract that the CONTRACTOR has failed to
perform, and;
4. Other sums that OCSD is entitled to recover from the CONTRACTOR
under the terms of the Contract, including but not limited to OCIP related
withholdings, costs and fees as specified in Exhibit B and Exhibit C
Insurance Manual.
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CONFORMED SEPTEMBER 26, 2012
Page 2 of 8
The failure of OCSD to deduct any of the above-identified sums from a
progress payment shall not constitute a waiver of OCSD's right to such sums or
to deduct them from a later progress payment.
EXA-4 STOP PAYMENT NOTICE
In addition to other amounts properly withheld under this article or under other
provisions of the Contract, OCSD shall retain from progress payments
otherwise due the CONTRACTOR an amount equal to one hundred twenty-five
percent (125%) of the amount claimed under any stop payment notice under
Civil Code §9350 et. seq. or other lien filed against the CONTRACTOR for
labor, materials, supplies, equipment, and any other thing of value claimed to
have been furnished to and/or incorporated into the Work; or for any other
alleged contribution thereto. In addition to the foregoing and in accordance with
Civil Code §9358 OCSD may also satisfy its duty to withhold funds for stop
payment notices by refusing to release funds held in escrow pursuant to public
receipt of a release of stop payment notice executed by a stop payment notice
claimant, a stop payment notice release bond, an order of a court of competent
jurisdiction, or other evidence satisfactory to OCSD that the CONTRACTOR
has resolved such claim by settlement.
EXA-5 PAYMENT TO SUBCONTRACTORS
Requirements
1. The CONTRACTOR shall pay all Subcontractors for and on account of
Work performed by such Subcontractors, not later than seven (7) days after
receipt of each progress payment as required by the California Business
and Professions Code §7108.5. Such payments to Subcontractors shall be
based on the measurements and estimates made pursuant to article
progress payments provided herein.
2. Except as specifically provided by law, the CONTRACTOR shall pay all
Subcontractors any and all retention due and owing for and on account of
Work performed by such Subcontractors not later than seven (7) days after
CONTRACTOR'S receipt of said retention proceeds from OCSD as
required by the California Public Contract Code §7107.
EXA-6 PAYMENT OF TAXES
Unless otherwise specifically provided in this Contract, the Contract Price
includes full compensation to the CONTRACTOR for all taxes. The
CONTRACTOR shall pay all federal, state, and local taxes, and duties
applicable to and assessable against any Work, including but not limited to
retail sales and use, transportation, export, import, business, and special taxes.
The CONTRACTOR shall ascertain and pay the taxes when due. The
CONTRACTOR will maintain auditable records, subject to OCSD reviews,
confirming that tax payments are current at all times.
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PROJECT NO. P2-105 REBID
DIGESTER FERRIC CHLORIDE SYSTEM REHABILITATION
CONFORMED SEPTEMBER 26, 2012
Page 3 of 8
EXA-7 FINAL PAYMENT
After Final Acceptance of the Work, as more particularly set forth in the
General Conditions, "Final Acceptance and Final Completion", and after
Resolution of the Board authorizing final payment and satisfaction of the
requirements as more particularly set forth in General Conditions — "Final
Payment", a final payment will be made as follows:
1. Prior to Final Acceptance, the CONTRACTOR shall prepare and submit an
application for Final Payment to OCSD, including:
a. The proposed total amount due the CONTRACTOR, segregated by
items on the payment schedule, amendments, Change Orders, and
other bases for payment;
b. Deductions for prior progress payments;
c. Less all amounts for the OCIP including, but not limited to, payments for
the Contractor's Obligation, OCIP-related audit costs and OCIP
penalties assessed;
d. Amounts retained;
e. A conditional waiver and release on final payment for each
Subcontractor (per Civil Code section 8136);
f. A conditional waiver and release on final payment on behalf of the
CONTRACTOR (per Civil Code section 8136);
g. List of Claims the CONTRACTOR intends to file at that time or a
statement that no Claims will be filed,
h. List of pending unsettled claims, stating claimed amounts, and copies of
any and all complaints and/or demands for arbitration received by the
CONTRACTOR; and
i. For each and every claim that resulted in litigation or arbitration which
the CONTRACTOR has settled, a conformed copy of the Request for
Dismissal with prejudice or other satisfactory evidence the arbitration is
resolved.
j. All completed Aon Form-5 Notices of Work Completion for itself and
each Subcontractor as specified in Exhibit B and Exhibit C Insurance
Manual.
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PROJECT NO. P2-105 REBID
DIGESTER FERRIC CHLORIDE SYSTEM REHABILITATION
CONFORMED SEPTEMBER 26, 2012
Page 4 of 8
2. The application for Final Payment shall include complete and legally
effective releases or waivers of liens and stop payment notices satisfactory
to OCSD, arising out of or filed in connection with the Work. Prior progress
payments shall be subject to correction in OCSD's review of the application
for Final Payment. Claims filed with the application for Final Payment must
be otherwise timely under the Contract and applicable law.
3. Within a reasonable time, OCSD will review the CONTRACTOR'S
application for Final Payment. Any recommended changes or corrections
will then be forwarded to the CONTRACTOR. Within ten (10) calendar days
after receipt of recommended changes from OCSD, the CONTRACTOR will
make the changes, or list Claims that will be filed as a result of the
changes, and shall submit the revised application for Final Payment. Upon
acceptance by OCSD, the revised application for Final Payment will
become the approved application for Final Payment.
4. If no Claims have been filed with the initial or any revised application for
Final Payment, and no Claims remain unsettled within thirty (30) calendar
days after Final Acceptance of the Work by OCSD, and agreements are
reached on all issues regarding the application for Final Payment, OCSD,
in exchange for an executed release, satisfactory in form and substance to
OCSD, will pay the entire sum found due on the approved application for
Final Payment, including the amount, if any, allowed on settled Claims.
5. The release from the CONTRACTOR shall be from any and all Claims
arising under the Contract, except for Claims that with the concurrence of
OCSD are specifically reserved, and shall release and waive all unreserved
Claims against OCSD and its officers, directors, employees and authorized
representatives. The release shall be accompanied by a certification by the
CONTRACTOR that:
a. It has resolved all Subcontractors, Suppliers and other Claims that are
related to the settled Claims included in the Final Payment;
b. It has no reason to believe that any party has a valid claim against the
CONTRACTOR or OCSD which has not been communicated in writing
by the CONTRACTOR to OCSD as of the date of the certificate;
c. All warranties are in full force and effect, and;
d. The releases and the warranties shall survive Final Payment.
6. If any claims remain open, OCSD may make Final Payment subject to
resolution of those claims. OCSD may withhold from the Final Payment an
amount not to exceed one hundred fifty percent (150%) of the sum of the
amounts of the open claims, and one hundred twenty-five percent (125%)
of the amounts of open stop payment notices referred to in article entitled
stop payment notices herein.
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PROJECT NO. P2-105 REBID
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CONFORMED SEPTEMBER 26, 2012
Page 5 of 8
7. The CONTRACTOR shall provide an unconditional waiver and release on
final payment from each Subcontractor and Supplier providing Work under
the Contract (per Civil Code Section 8138) and an unconditional waiver and
release on final payment on behalf of the CONTRACTOR (per Civil Code
Section 8138) within thirty (30) days of receipt of Final Payment.
EXA-8 DISCOVERY OF DEFICIENCIES BEFORE AND AFTER FINAL PAYMENT
Notwithstanding OCSD's acceptance of the application for Final Payment and
irrespective of whether it is before or after Final Payment has been made,
OCSD shall not be precluded from subsequently showing that:
1. The true and correct amount payable for the Work is different from that
previously accepted;
2. The previously-accepted Work did not in fact conform to the Contract
requirements, or;
3. A previous payment or portion thereof for Work was improperly made.
OCSD also shall not be stopped from demanding and recovering damages
from the CONTRACTOR, as appropriate, under any of the foregoing
circumstances as permitted under the Contract or applicable law.
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PROJECT NO. P2-105 REBID
DIGESTER FERRIC CHLORIDE SYSTEM REHABILITATION
CONFORMED SEPTEMBER 26, 2012
Page 6 of 8
ATTACHMENT 1
CERTIFICATION FOR REQUEST FOR PAYMENT
I hereby certify under penalty of perjury as follows:
That the claim for payment is in all respects true, correct; that the services mentioned
herein were actually rendered and/or supplies delivered to OCSD in accordance with the
Contract.
I understand that it is a violation of both the federal and California False Claims Acts to
knowingly present or cause to be presented to OCSD a false claim for payment or
approval.
A claim includes a demand or request for money. It is also a violation of the False
Claims Acts to knowingly make use of a false record or statement to get a false claim
paid. The term "knowingly" includes either actual knowledge of the information,
deliberate ignorance of the truth or falsity of the information, or reckless disregard for the
truth or falsity of the information. Proof of specific intent to defraud is not necessary
under the False Claims Acts. I understand that the penalties under the Federal False
Claims Act and State of California False Claims Act are non-exclusive, and are in
addition to any other remedies which OCSD may have either under contract or law.
I hereby further certify, to the best of my knowledge and belief, that:
1. The amounts requested are only for performance in accordance with the
Specifications, terms, and conditions of the Contract;
2. Payments to Subcontractors and Suppliers have been made from previous payments
received under the Contract, and timely payments will be made from the proceeds of
the payment covered by this certification;
3. This request for progress payments does not include any amounts which the prime
CONTRACTOR intends to withhold or retain from a Subcontractor or Supplier in
accordance with the terms and conditions of the subcontract; and
4. This certification is not to be construed as Final Acceptance of a Subcontractor's
performance.
Name
Title
Date
C-EXA-071012
PROJECT NO. P2-105 REBID
DIGESTER FERRIC CHLORIDE SYSTEM REHABILITATION
CONFORMED SEPTEMBER 26, 2012
Page 7 of 8
ATTACHMENT 2
SCHEDULE OF PRICES
Item Approx. Item Unit Total
No. Qty. Price Price
1. Lump Furnish all labor, materials and equipment necessary
Sum for mobilization not to exceed 5% of the Total Amount
of Bid as defined in Specification Section 1110,
Measurement and Payment in accordance with the
Contract Documents for the lump sum price of... L.S. $ 80,000
2. Lump Furnish all labor, materials, and equipment necessary
Sum for sheeting, shoring and bracing for protection of life
and limb in trenches, open excavations and confined
spaces in conformance with the Contract Documents
and all applicable laws, for the lump sum price of... L.S. $ 20,000
3. Lump Furnish all labor, materials, equipment and services,
Sum except for items 1 and 2 above, for the construction
of, PROJECT NO. P2-105 REBID DIGESTER
FERRIC CHLORIDE SYSTEM REHABILITATION, for
the lump sum price of... L.S. $ 1,594,000
TOTAL AMOUNT OF BID (BASIS OF AWARD) $ 1,694,000
C-EXA-071012
PROJECT NO. P2-105 REBID
DIGESTER FERRIC CHLORIDE SYSTEM REHABILITATION
CONFORMED SEPTEMBER 26, 2012
Page 8 of 8
09/14/2012 09 : 19 FAX Lm. Vv 10 vvw
ENVIRONMENTAL
CONSTRUCTIONx-INC .
GENERAL ENG TNEERING CONTkACTORS
21550 OXNARD STREET , SUITE 1050
WOODLAND HILLS , CA 91367
FAX COVER SHEET
TO: FROM:
Michele Chewning Beverly Parks for Farid Soroudi
COMPANY: DATE;
OCSD 9-14-12
PAX NUMBF,'R. TOTAL NO OF PAGES INCLUDING COVER:
714-593-7779 3
PHONE NUMBER: PHONE NUMBER,
714-593-7533 818-449-8920
RE- FAX NUMBr-R,
818-703-9073
EJ URGENT 11 FOR R.PVIFW C1 Pt,t.A5F.COMMENT 0 PLEASE REPLY 0 PLEASE RECYCLE
000k�
IF YOU HAVE NOT RECEIVED ALL THE PAGE
S CAL L ME
09f 14/2012 09: 19 FAX f&002/003
ENVIRONMENTAL CONSTRUCTION, INC.
General Engineering Contractor
21550 Oxnard Street,Suite 1050
Woodland Hills,CA 91367
September 23, 2012
Michelle Chewning
Contract Administrator
Orange County Sanitation District
10844 Ellis Ave.
Fountain Valley,Ca 92708
Re:Award Protest, Project No. P2-105 Rebid
Dear Ms.Chewning:
Environmental construction Inc_ hereby,In accordance with 'Instruction to Bidders% page 17,Section
'Contract Award Protest',submits a protest on the bid of ODC Engineering.
Notice to Bidders,Section I8-14, Bid Evaluation Process sets forward the requirement for bidder to
present evidence that it has successfully performed similar work of comparable magnitude.
Section BF-4,of the bid package titled "Performance History and Financial Resources",states that"Using
this form,the bidder shall demonstrate that it has self-performed or........and as a minimum it has
completed construction of three_proiect that are of similar natur_ .ggpe and cost to this invitation to
bid".
ODC Engineering listed five projects as proof of experience.All listed project are for improvements to
classrooms at LAUSD which is significantly different than mechanical work in a water treatment plant.
None of these projects meet the 51mi_lar_5cope..and_IY.atur_e.requirement of the bid proposal and only
one project(Not the required three)has a similar cost to this bid invitation.
Additionally ODC has tried to misrepresent their experience by wrongfully stating the through nature of
their reference projects. For Example the true project name for the reference they note as"Jefferson
HS-LA" is,Jefferson H$, HVAC System Replacement(refer to LAUSD website for proof). Respectively the
description of work for this project is listed as plumbing,cone, new gas system,etc. It is obvious from
the title of this project that it is HVAC replacement work with other trades as incidental.The
misrepresentation is being made to draw an illusion that HVAC replacement is the same scope of work
as Ferric Chloride System Rehabilitation!
ODC Engineering does not meet the minimum experience requirement set forth in the Subject bid
proposal and their bid should be deemed non-responsive.
Section IB-14, Paragraph B,"Safety"of the Notice To Bidders, requires that the project be awarded to a
bidder with a Workers Compensation Exp, Mod. Rating lower than 1.01.ODC Engineering does not have
sufficient employees to be rated by the Workers Compensation Rating Bureau and therefore their safety
09/14/2012 09:20 FAX IO' VVQJVVQ
record cannot be verified.ODC is Mostly a paper contractor with limited resources that operates
through its subcontractor.
Scrutinizing established firms with stringent safety requirements of this proposal will place them at an
unfair disadvantage against construction companies with limited or no workforce. No safety track record
should be deemed unacceptable and not proof of safe operations.
We request that after review of the above facts this project be awarded to Environmental Construction
inc.as the lowest most responsible/responsive bidder.
I am available at(818)254-5018 to provide you with additional information.
$1 n c e rell
Z;Fred Soroudi
President
Orange County Sanitation District
Serving: 10844 Ellis Avenue,Fountain Valley,CA 92708
Anaheim (714)962-2411 www.ocsewers.com
CypressBrea
Buena Park
Fountain Valley September 19, 2012 Via Fax (818) 703-9073
& U.S. Certified Mail
Fullerton
Garden Grove Farid Soroudi
HuntingtonBeach Environmental Construction, Inc.
Irvine 21550 Oxnard Street, Suite 1050
Woodland Hills. CA 91367
HabraLa
La Palma
SUBJECT: Re: Protest of Award Determination
Los Alamitos Project No. P2-105 Rebid, Digester Ferric Chloride System
Newport Beach Rehabilitation
Orange
Placentia On September 14, 2012. the Orange County Sanitation District (OCSD) received a
Santa Ana letter dated September 13, 2012, from Environmental Construction. Inc. regarding its
Award Protest for Project No. P2-105 Rebid, protesting the award of Project P2-105
SealBeach Rebid to ODC Engineering and Technology. OCSD has evaluated and considered
Stanton the issues raised in Environmental Construction, Inc.'s award protest. This letter shall
serve as OCSD's formal response to your protest.
Environmental Construction.. Inc. contends, as stated in the above referenced letter,
Villa Park as follows:
Yorba Linda
1. Based on the information provided by ODC Engineering and Technology in
OrangeCounty of BF-4 Performance History and Financial Resources, ODC Engineering and
CostaTechnology lacks the experience required under the bid documents for
SanitaryProject P2-105 Rebid.
Midway City 2. ODC Engineering and Technology does not have sufficient employees to be
Sanitary District rated by the Workers Compensation Rating Bureau, and therefore, their
Irvine Ranch experience modification rate (EMR) listed in BF-6 Safety Declaration
Water District Pursuant to Government Code Section 4420 cannot be verified.
As part of the bid evaluation process, OCSD staff evaluated ODC Engineering and
Technology's performance history and contacted the listed references. Furthermore,
pursuant to I13-14, Evaluation Process, Item A.2, OCSD staff contacted other project
SAHIT oo�ty AT�oy owners and obtained additional information verifying ODC Engineering and
Technology's experience. Additional references included OCSD Project Managers
9 who worked with ODC Engineering and Technology directly on previous OCSD
projects. Based on all the information provided by ODC Engineering and
Technology along with the information gathered as part of the evaluation process,
OCSD was able to determine that ODC Engineering and Technology met the
THE ENV minimum experience requirements as stated in the bid documents and therefore was
deemed responsive and responsible.
We protect public health and the environment by providing effective
wastewater collection, treatment, and recyling.
JNty SAW74r0
O �
� 9
¢ I c
o \
o ti
R,TiNG THE EN�\Q�?
Farid Soroudi
Page 2 of 2
September 19, 2012
OCSD staff evaluated ODC Engineering and Technology's Safety record according
to the bid documents and OCSD policy. A Clarification Request was issued by
OCSD requesting a letter from ODC Engineering and Technology's workers'
compensation insurance carrier and loss run reports which OCSD used for its safety
evaluation. ODC Engineering and Technology provided additional information as
requested by OCSD, which was verified by staff. OCSD staff determined that ODC
Engineering and Technology substantiated the information provided and therefore
was deemed to be responsive and responsible.
OCSD has evaluated and considered the award protest and arguments raised by
Environmental Construction Inc. in its letter dated September 13, 2012, and received
by OCSD on September 14, 2012. Based on the evaluation and conclusions as
described herein, OCSD hereby denies Environmental Construction Inc.'s Award
Protest, and will proceed to recommend award of the Project P2-105 Rebid Contract
to the lowest responsive and responsible Bidder, CDC Engineering and Technology,
at the Board of Directors meeting on September 26, 2012.
I`t;,�wG,;>✓ C�,�1
Michelle Chewnin
9
Contracts Administrator
MC:ms
EDMS:003962774
cc: J. Herberg
M. Ayala
M. Dubois
D. Fisher
U. Murthy
J. Kim
Contract File 7.4.4e
Return to Agenda
BOARD OF DIRECTORS Meeting Date To Bd. of Dir.
09/26/12
AGENDA REPORT Item Number Item Number
6
Orange County Sanitation District
FROM: James D. Ruth, General Manager
Originator: Jim Herberg, Assistant General Manager
Project Manager: Wendy Smith, Engineer
GENERAL MANAGER'S RECOMMENDATION
Grant a Non-Exclusive Temporary Construction Easement to Orange County Flood
Control District for the Newland Storm Channel Rehabilitation Project from the final
execution date to the earliest occurrence of either the Notice of Completion filing or until
July 31, 2015, in a form approved by General Counsel.
SUMMARY
Orange County Flood Control District (OCFCD) is requesting a temporary construction
easement for the duration of the Newland Storm Channel Rehabilitation Project. The
temporary construction easement will grant OCFCD personnel and agents the right to
use the easement for ingress and egress as well as for construction purposes.
The limits of the temporary construction easement encompass Orange County
Sanitation District's (OCSD) Knott Interceptor, a 96-inch reinforced concrete pipe with
approximately 8 feet of cover; therefore, to preserve the structure integrity of the pipe,
restrictions have been placed on the height of excavated soil stockpiles, and the weight
of construction materials. OCSD has also required that OCSD personnel will have
access to the property for scheduled maintenance activities such as weed abatement
and odor control.
OCSD did not request monetary compensation for the temporary use of the property
because it will not impact OCSD's operations.
PRIOR COMMITTEE/BOARD ACTIONS
N/A
ADDITIONAL INFORMATION
N/A
CEQA
The County of Orange assumed the role of lead agency for the project and is
responsible for overall compliance with CEQA. OCSD is a "responsible agency" for this
Form No.DW-102 Revised:01/11/10
Page 1
project. OCSD complies with CEQA by considering the environmental documentation
prepared by the lead agency, and OCSD reaches its own conclusions on whether and
how to approve the proposed action. (14 Cal. Code Regs. § 15096(a)).
BUDGET/DELEGATION OF AUTHORITY COMPLIANCE
This request complies with authority levels of the OCSD's Delegation of Authority.
ATTACHMENT
The following attachment(s) may be viewed on-line at OCSD website with complete agenda package and
attachments:
( OCFCD Temporary Construction Easement Agreement
( Exhibit - Location and Easement limits
WS:sa:gc
Form No.DW-102 Revised:01/11/10
Page 2
O R A N G E C o u N T r Ignacio G.Ochoa,Interim Director
01 300 N.Flower Street
('U'DCPubhcW O r Santa Ana,CA
k S P.O.Box 4048
Santa Ana,CA 92702-4048
Our Community. our Commitment.
Telephone: (714)834-2300
Fax: (714)967-0896
July 25, 2012 ROWE I.D. No.: 2012-067-
Wendy Smith, P.E., Planning Division Engineer
Orange County Sanitation District
10844 Ellis Avenue
Fountain Valley, CA 92708
Subject: Newland Storm Channel C05S01 —Temporary Construction Easement Deed
Ms. Smith:
Attached is the Temporary Construction Easement Deed for the above reference project to the
Orange County Flood Control District. Please have the Temporary Construction Easement Deed
executed and returned to this office for acceptance and recording.
It is required that one corporate officer from each of the following two groups sign a document
for a corporation(Corporation Code Section 313): a) the chairman of the board, president, or
any vice-president, and b) the secretary, any assistant secretary, the head financial officer, or
any assistant treasurer. The signature of one person alone is sufficient as long as he or she
signs twice, once as an officer from group"a" andonce as an officer from group"b"shown
above. All documents executed on behalf of corporate parties must meet the above
requirements or they will be rejectedat the advice of Orange County Counsel.
If you have questions, please contact Mal Peralta, of this office, at 714-667-9654 or by e-mail at
Malaquias.Peralta@ocpw.ocgov.com.
Sincerely,
Jo 4nD. avlik, P.L.S.
Right of Way Engineering Manager
Enclosure(s): Temporary Easement Deed
Location Map
cc: Rowell Castro, Civil Engineer, OC Flood Control Design
Ron Gaut, Manager, OC Flood Control Design
Recording requested by and
when recorded,return to:
OC Public Works
Right of Way Engineering
P.O.Box 4048
Santa Ana,CA 92702-4048
Recording Fee Exempt
Per Govt. Code 27383 I
APN: 107-923-29 Facility: Newland Storm Channel
Facility/Parcel No.: C05S01-103
TEMPORARY CONSTRUCTION EASEMENT
For valuable consideration, receipt of which is hereby acknowledged,
ORANGE COUNTY SANITATION DISTRICT,
a County Sanitation District, hereinafter referred to as "GRANTOR",
does hereby Grant to the
ORANGE COUNTY FLOOD CONTROL DISTRICT,
a body corporate and politic, hereinafter referred to as "GRANTEE"
a non-exclusive temporary easement for construction purposes, in, on, over and across the real
property located in the City of Westminster, County of Orange, State of California, bearing
Assessor Parcel Number 107-923-29, and described as:
See EXHIBIT A, for legal description and EXHIBIT B for depiction,
attached hereto and by reference made a part hereof("Property").
Together with the right to enter upon, to pass and repass over and along said land and to
deposit tools, implements, temporary fill and other materials thereon by said GRANTEE, its
officers, agents and employees and by persons under contract with it and their employees,
whenever and wherever necessary for the purposes above set forth, and subject to the following
restrictions:
1) Stockpiling of excavated soil is limited to a maximum of 10 feet.
2) The weight of construction materials is limited to 800 pounds per square foot.
3) GRANTEE's use of the Property shall not interfere with GRANTOR's access
(ingress and egress) to and around GRANTOR's Facilities (as defined below).
I
The temporary construction easement ("TCE") herein granted shall become effective upon
the execution of this document and shall terminate on July 31, 2015, or upon the filing of a Notice
of Completion, whichever occurs first.
By accepting this TCE, GRANTEE hereby agrees as follows:
1. GRANTEE hereby acknowledges and understands that GRANTOR owns and maintains
a facility (96-inch RCP) on the Property approximately eight (8) feet deep, along with
other improvements, including manholes, (collectively "Facilities"), and GRANTOR
may enter the Property at any time for the operation and maintenance of GRANTOR's
Facilities located thereon. At all times during the term of this TCE and during
GRANTEE'S project, all driveways and access to GRANTOR'S Facilities shall remain
accessible for ingress and egress to the Property. GRANTEE shall ensure that
GRANTEE'S use of the Property shall not interfere with GRANTOR'S use of its
Facilities, including scheduled maintenance, repair, or replacement.
2. GRANTEE shall not alter or impair the Facilities or Property or cause any damage to
the Facilities or Property in the exercise of the privileges granted by this Temporary
Construction Easement ("TCE"), and GRANTEE shall restore and return the Facilities
and Property in substantially the same condition as found before such work was
undertaken. In the event that GRANTEE intentionally or negligently causes damage to
the Facilities or Property, GRANTEE shall immediately repair any such damage at
GRANTEE'S sole cost and expense. GRANTOR may elect to repair such damage
itself, in which case, GRANTEE agrees to and shall reimburse the GRANTOR for the
reasonable costs and expenses in connection therewith.
3. To the extent permitted by law, GRANTEE(or its contractor) shall indemnify, defend
and hold harmless GRANTOR from all losses, liabilities, costs, damages, expenses,
causes of action, suits, claims or judgments (including, without limitation, attorney's
fees and costs), arising directly or indirectly out of or in connection with any act or
omission of GRANTEE, its employees, representatives, agents, suppliers or
subcontractors, pursuant to this TCE or otherwise.
4. GRANTEE acknowledges that it will be its responsibility to secure all permits or
authorizations from third parties and governmental authorities, if any are necessary, for
it to utilize the rights granted hereby. While performing GRANTEE'S Project,
GRANTEE shall comply in all respects with all applicable laws, ordinances and
regulations.
Nothing in this TCE is intended nor shall anything in this TCE be construed to transfer to the
GRANTEE or its successors or assigns or to relieve GRANTOR or its successors or assigns or
predecessors in title of any responsibility or liability GRANTOR or its successors or assigns or
predecessors in title now has, has had or comes to have with respect to human health or the
environment, including but not limited to responsibility or liability relating to hazardous or toxic
substances or materials (as such terms as those used in this sentence are defined by statute,
ordinance, case law, governmental regulation or other provision of the law). Furthermore,
GRANTEE may exercise its right under law to bring action, if necessary, to recover clean up costs
and penalties paid, if any, from GRANTOR or any others who are ultimately determined by a court
of competent jurisdiction and/or a federal, state or local regulatory or administrative governmental
agency or body having jurisdiction, to have responsibility for said hazardous or toxic substances or
materials upon, within, or under the real property interests transferred pursuant to this TCE.
2
Notwithstanding the foregoing, GRANTEE shall be and remain liable for any hazardous or toxic
substances or materials which become located, because of GRANTEE's operations, upon, within,
or under the real property interests transferred pursuant to this TCE.
ORANGE COUNTY SANITATION DISTRICT
Dated: By:
Print Name
(Title)
By:
(Print Name
(Title)
APPROVED AS TOO FO
By: A
B adley R. Hogin
General Counsel
State of California )
County of )
On before me,
(here insert name and title of the officer)
personally appeared
who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are
subscribed to the within instrument and acknowledged to me that he/she/they executed the same in
his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the
person(s), or the entity upon behalf of which the person(s) acted, executed the instrument.
I certify under PENALTY OF PERJURY under the laws of the State of California that the
foregoing paragraph is true and correct.
WITNESS my hand and official seal.
Signature
3
CERTIFICATE OF ACCEPTANCE
This is to certify that the interest in real property, including all rights, duties, obligations, and restrictions
contained therein, conveyed by the within TEMPORARY CONSTRUCTION EASEMENT to the
ORANGE COUNTY FLOOD CONTROL DISTRICT, a body corporate and politic, is hereby accepted
by order of the Board of Supervisors of the County of Orange, California, acting as the governing board
of the ORANGE COUNTY FLOOD CONTROL DISTRICT, pursuant to authority conferred by minute
order dated June 21, 2005 of the said Board of Supervisors, and the ORANGE COUNTY FLOOD
CONTROL DISTRICT consents to recordation thereof by its duly authorized officer.
ORANGE COUNTY FLOOD CONTROL DISTRICT,
a body corporate and politic
Dated: By:
Ignacio G. Ochoa,Interim Director
OC Public Works
Pursuant to Minute Order Dated June 21,2005
APPROVED AS TO FORM
County Counsel
B �,-tPe—
Deputy
Date: /23//L
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COUNTY OF ORANGE ID#2011 -062 EXHIBIT B
OC PUBLIC WORKS
RIGHT-OF-WAY ENGINEERING SCALE : 1"= 100' Sheet 1 of 1
PROJECT : NEWLAND STORM CHANNEL [C05S01-1031 - TCE
Return to Agenda
BOARD OF DIRECTORS Meeting Date To Bd. of Dir.
09/26/12
AGENDA REPORT Item Number Item Number
7
Orange County Sanitation District
FROM: James D. Ruth, General Manager
Originator: Lorenzo Tyner, Director of Finance and Administrative Services
SUBJECT: REVENUE REFUNDING CERTIFICATE ANTICIPATION NOTES,
SERIES 2012C
GENERAL MANAGER'S RECOMMENDATION
A. Adopt Resolution No. OCSD 12-12, authorizing the execution and delivery by the
District of an Installment Purchase Agreement, a Trust Agreement and a Continuing
Disclosure Agreement in connection with the execution and delivery of Orange
County Sanitation District Revenue Refunding Certificate Anticipation Notes, Series
2012C, such Notes evidencing principal in an aggregate amount of not to exceed
$145,000,000, approving a Notice of Intention to Sell, authorizing the distribution of
an Official Notice Inviting Bids and an Official Statement in connection with the
offering and sale of such Notes and authorizing the execution of other necessary
documents and related actions; and,
B. That the Orange County Sanitation District Financing Corporation approve the
documents supporting and authorizing the Notes in an aggregate amount not to
exceed $145,000,000
SUMMARY
On September 12, 2012, the Administration Committee authorized the General
Manager to issue Revenue Refunding Certificate Anticipation Notes, Series 2012C, as
one-year fixed-rate obligations, in an amount not to exceed $145.0 million to replace the
$143.205 million Revenue Refunding Certificate Anticipation Notes, Series 2011 B
maturing on November 9, 2012.
The purpose of the financing is to refund all of the 143.205 million Revenue Refunding
Certificate Anticipation Notes, Series 2011 B to avoid the use of the Sanitation District's
cash reserves to make repayment. The financing is structured as new one-year fixed
rate maturity that will be sold in a competitive sale.
Page 1 of 4
PRIOR COMMITTEE/BOARD ACTIONS
September 12, 2012 — The Administration Committee authorized the General Manager
to issue Revenue Refunding Certificate Anticipation Notes, Series 2012C, as one-year
fixed-rate obligations, in an amount not to exceed $145.0 million to replace the
$143.205 million Revenue Refunding Certificate Anticipation Notes, Series 2011 B
maturing on November 9, 2012.
ADDITIONAL INFORMATION
The Sanitation District currently has eleven series of debt issuances outstanding in the
par amount of $1.30 billion. The following table lists each issuance, the outstanding
amount, and the interest rate mode.
Outstanding Interest Rate
Par Amount') Mode
Series 2012B Refunding(2) $ 66,395,000 Fixed Rate
Series 2012A Refunding(3) 100,645,000 Fixed Rate
Series 2011 B(4) 143,205,000 Fixed Rate (one-year)
Series 2011A Refunding(2)(3) 140,195,000 Fixed Rate
Series 2010C(5) 157,000,000 Fixed Rate
Series 2010A(5) 80,000,000 Fixed Rate
Series 2009A Refunding(5) 191,265,000 Fixed Rate
Series 2008B Refunding(6) 26,075,000 Fixed Rate
Series 2008A Refunding(6) 19,195,000 Fixed Rate
Series 2007B(5) 279,250,000 Fixed Rate
Series 2007A Refunding(3) 92,845,000 Fixed Rate
Total : $1,296,070,000
(1) As of September, 1,2012
(2) Refunded a portion of Series 2000
(3) Refunded a portion of Series 2003
(4) Series 2011B are fixed one-year certificate of anticipation notes(CANS),that refunded the
Series 2010B CANS,that refunded the Series 2009B CANS,that refunded the 2008C CANS
that were issued to refund the Series 2006 Daily Variable Rate that were supported by a
weak liquidity facility bank.
(5) New money debt issue
(6) Series 2008B and Series 2008A refunded the Series 1993 and Series 1992 Synthetic
Variable-to-Fixed Rate Debt issues that were supported by a failing insurance provider.
Series 1993 and 1992 refunded the Series 1986 and a portion of the Series"B"COPs.
Due to the fact that this is a fixed-rate debt issuance, staff is proposing to issue the
refunding through a competitive sale because it is the most expeditious way to access
the market and it is expected to provide the lowest interest cost for this given structure.
All costs involved with the refunding, including costs for PRAG and Fulbright & Jaworski
will be paid from the proceeds of the new refunding issue.
Page 2 of 4
Legal Authorization and Approvals
The Board of Directors and the Financing Corporation will each be required to adopt
separate Resolutions to complete this refunding. Drafts of these two Resolutions are
available for review on the Sanitation District's webpage, as described in the
"Attachments" section below. A Financing Corporation is required by the structure of
the Notes and was formed in April 2000 solely to satisfy this need. The Board of
Directors of the Corporation is the same as the Board of Directors of the Sanitation
District and the Corporation meets after an adjournment of the OCSD Board.
The OCSD Resolution authorizes the execution and delivery of certain legal documents
and the execution and delivery of Revenue Refunding Certificate Anticipation Notes,
Series 2012C, evidencing principal in an aggregate amount not to exceed $145,000,000
as stated in the title as follows:
"A RESOLUTION OF THE BOARD OF DIRECTORS OF THE ORANGE COUNTY
SANITATION DISTRICT AUTHORIZING THE EXECUTION AND DELIVERY BY THE
DISTRICT OF AN INSTALLMENT PURCHASE AGREEMENT, A TRUST
AGREEMENT AND A CONTINUING DISCLOSURE AGREEMENT IN CONNECTION
WITH THE EXECUTION AND DELIVERY OF ORANGE COUNTY SANITATION
DISTRICT REVENUE REFUNDING CERTIFICATE ANTICIPATION NOTES, SERIES
2012C, SUCH NOTES EVIDENCING PRINCIPAL IN AN AGGREGATE AMOUNT OF
NOT TO EXCEED $145,000,000, APPROVING A NOTICE OF INTENTION TO SELL,
AUTHORIZING THE DISTRIBUTION OF AN OFFICIAL NOTICE INVITING BIDS AND
AN OFFICIAL STATEMENT IN CONNECTION WITH THE OFFERING AND SALE OF
SUCH NOTES AND AUTHORIZING THE EXECUTION OF OTHER NECESSARY
DOCUMENTS AND RELATED ACTIONS."
The Resolution of the Corporation is somewhat shorter and simpler. It authorizes three
actions that are similarly enumerated in the title as follows:
"A RESOLUTION OF THE BOARD OF DIRECTORS OF THE ORANGE COUNTY
SANITATION DISTRICT FINANCING CORPORATION AUTHORIZING THE
EXECUTION AND DELIVERY BY THE CORPORATION OF AN INSTALLMENT
PURCHASE AGREEMENT AND A TRUST AGREEMENT IN CONNECTION WITH
THE EXECUTION AND DELIVERY OF ORANGE COUNTY SANITATION DISTRICT
REVENUE REFUNDING CERTIFICATE ANTICIPATION NOTES, SERIES 2012C,
AUTHORIZING THE EXECUTION AND DELIVERY OF SUCH NOTES EVIDENCING
PRINCIPAL IN AN AGGREGATE AMOUNT OF NOT TO EXCEED $145,000,000 AND
AUTHORIZING THE EXECUTION OF OTHER NECESSARY DOCUMENTS AND
RELATED ACTIONS."
Following is a chart listing the remaining steps to be completed for the issuance of the
Revenue Refunding Certificate Anticipation Notes, Series 2012C debt issuance:
Page 3 of 4
* Board approval of legal and disclosure documents
September * Financing Corporation approval of legal and
disclosure documents
* Rating Agency discussions
* Publish Notice of Intention to Sell
October * Marketing and Sale through a Competitive Sale
Process
* Closing
* Begin debt administration
CEQA
N/A
BUDGET/DELEGATION OF AUTHORITY COMPLIANCE
N/A
ATTACHMENTS
( District Resolution
( Corporation Resolution
The following attachment(s) may be viewed on-line at OCSD website with complete agenda package and
attachments:
( Draft Trust Agreement
( Draft Installment Purchase Agreement
( Draft Continuing Disclosure Agreement
( Draft Preliminary Official Statement
( Draft Official Notice Inviting Bids
( Draft Notice of Intention to Sell
Page 4 of 4
RESOLUTION NO. OCSD 12-12
A RESOLUTION OF THE BOARD OF DIRECTORS OF THE ORANGE
COUNTY SANITATION DISTRICT AUTHORIZING THE EXECUTION
AND DELIVERY BY THE DISTRICT OF AN INSTALLMENT
PURCHASE AGREEMENT, A TRUST AGREEMENT AND A
CONTINUING DISCLOSURE AGREEMENT IN CONNECTION WITH
THE EXECUTION AND DELIVERY OF ORANGE COUNTY
SANITATION DISTRICT REVENUE REFUNDING CERTIFICATE
ANTICIPATION NOTES, SERIES 2012C, SUCH NOTES EVIDENCING
PRINCIPAL IN AN AGGREGATE AMOUNT OF NOT TO EXCEED
$145,000,000, APPROVING A NOTICE OF INTENTION TO SELL,
AUTHORIZING THE DISTRIBUTION OF AN OFFICIAL NOTICE
INVITING BIDS AND AN OFFICIAL STATEMENT IN CONNECTION
WITH THE OFFERING AND SALE OF SUCH NOTES AND
AUTHORIZING THE EXECUTION OF OTHER NECESSARY
DOCUMENTS AND RELATED ACTIONS
WHEREAS, to refinance the acquisition, construction and installation of certain
improvements to its wastewater system (the "Prior Project") the District caused the execution
and delivery of $143,205,000 in aggregate principal amount of Orange County Sanitation
District Revenue Refunding Certificate Anticipation Notes, Series 2011B, of which
$143,205,000 in principal amount is currently outstanding (the "Prior Certificates");
WHEREAS, the District desires to pay at maturity all of the Prior Certificates by paying
all of the principal component of the installment payment relating to the Prior Certificates (the
"Prior Installment Payment"), and the interest component thereof, thereby causing all of the Prior
Certificates to be paid;
WHEREAS, to provide the funds necessary to pay the Prior Installment Payment to be
so paid, the District and the Orange County Sanitation District Financing Corporation (the
"Corporation") desire that the Corporation purchase the Prior Project from the District and the
District sell the Prior Project to the Corporation, and that the District then purchase the Prior
Project from the Corporation and the Corporation sell the Prior Project to the District, for the
installment payment (the "Installment Payment") to be made by the District, pursuant to a new
installment purchase agreement (the "Installment Purchase Agreement"), and the Corporation
and the District have agreed to finance such payment by causing the execution and delivery of up
to $145,000,000 in aggregate principal amount of Orange County Sanitation District Revenue
Refunding Certificate Anticipation Notes, Series 2012C (the "Notes") to be repaid from the sale
proceeds of future certificates of participation, other notes or obligations or lawfully available
funds of the District;
WHEREAS, the Corporation intends to assign without recourse certain of its rights
under and pursuant to the Installment Purchase Agreement to Union Bank, N.A., as trustee (the
"Trustee"), pursuant to a Trust Agreement by and among the Trustee, the Corporation and the
District (such Trust Agreement, in the form presented to this meeting, with such changes,
95713826.4
insertions and omissions as are made pursuant to this Resolution, being referred to herein as the
"Trust Agreement");
WHEREAS, in consideration of such assignment and the execution and delivery of the
Trust Agreement, the Trustee will be instructed to execute and deliver the Notes, evidencing
direct, undivided fractional interests in the Installment Payment, and the interest thereon;
WHEREAS, the District desires to provide for the public sale of the Notes in one or
more discrete sale transactions;
WHEREAS, a form of the Notice of Intention to Sell to be published in connection with
the public offering and sale of the Notes has been prepared (such Notice of Intention to Sell, in
the form presented to this meeting, with such changes, insertions and omissions as are made
pursuant to this Resolution, being referred to herein as the "Notice of Intention to Sell");
WHEREAS, a form of the Official Notice Inviting Bids to be distributed in connection
with the public offering and sale of the Notes has been prepared (such Official Notice Inviting
Bids, in the form presented to this meeting, with such changes, insertions and omissions as are
made pursuant to this Resolution, being referred to herein as the "Notice Inviting Bids");
WHEREAS, a form of the Preliminary Official Statement to be distributed in connection
with the public offering of the Notes has been prepared (such Preliminary Official Statement in
the form presented to this meeting, with such changes, insertions and omissions as are made
pursuant to this Resolution, being referred to herein as the "Preliminary Official Statement");
WHEREAS, Rule 15c2-12 promulgated by the Securities and Exchange Commission
under the Securities Exchange Act of 1934, as amended ("Rule 15c2-12"), requires that the
underwriter thereof must have reasonably determined that the District has undertaken in a written
agreement or contract for the benefit of the holders of the Notes to provide disclosure of certain
material events on an ongoing basis;
WHEREAS, to cause such requirement to be satisfied, the District desires to enter into a
Continuing Disclosure Agreement with a dissemination agent to be named therein and the
Trustee (such Continuing Disclosure Agreement in the form presented to this meeting, with such
changes, insertions and omissions as are made pursuant to this Resolution, being referred to
herein as the "Continuing Disclosure Agreement");
WHEREAS, there have been prepared and submitted to this meeting forms of:
(1) the Installment Purchase Agreement;
(2) the Trust Agreement;
(3) the Notice of Intention to Sell;
(4) the Notice Inviting Bids;
(5) the Preliminary Official Statement; and
95713826.4 2
(6) the Continuing Disclosure Agreement.
WHEREAS, all acts, conditions and things required by the Constitution and laws of the
State of California to exist, to have happened and to have been performed precedent to and in
connection with the consummation of the financing authorized hereby do exist, have happened
and have been performed in regular and due time, form and manner as required by law, and the
District is now duly authorized and empowered, pursuant to each and every requirement of law,
to consummate such financing for the purpose, in the manner and upon the terms herein
provided;
NOW, THEREFORE, THE BOARD OF DIRECTORS OF THE DISTRICT DOES
HEREBY RESOLVE,DETERMINE AND ORDER:
Section 1. All of the recitals herein contained are true and correct and the Board of
Directors of the District (the "Board") so finds.
Section 2. The Installment Purchase Agreement, in substantially the form submitted
to this meeting and made a part hereof as though set forth herein, be and the same is hereby
approved. The Chair of the Board, and such other member of the Board as the Chair may
designate, the General Manager of the District, the Director of Finance and Administrative
Services of the District, and such other officers of the District as the Director of Finance and
Administrative Services may designate (the "Authorized Officers") are, and each of them is,
hereby authorized and directed, for and in the name of the District, to execute and deliver the
Installment Purchase Agreement in the form submitted to this meeting, with such changes,
insertions and omissions as the Authorized Officer executing the same may require or approve,
such requirement or approval to be conclusively evidenced by the execution of the Installment
Purchase Agreement by such Authorized Officer; provided, however, that such changes,
insertions and omissions shall not result in an aggregate principal amount of the Installment
Payment in excess of $145,000,000, shall not result in a true interest cost for the Installment
Payment in excess of 2.0% per annum and shall not result in an Installment Payment later than
November 8, 2013.
Section 3. The Trust Agreement, in substantially the form submitted to this meeting
and made a part hereof as though set forth in full herein, be and the same is hereby approved.
The Authorized Officers are, and each of them is, hereby authorized and directed, for and in the
name of the District, to execute and deliver the Trust Agreement in the form presented to this
meeting, with such changes, insertions and omissions as the Authorized Officer executing the
same may require or approve, such requirement or approval to be conclusively evidenced by the
execution of the Trust Agreement by such Authorized Officer.
Section 4. The execution and delivery of Notes evidencing principal in an aggregate
amount of not to exceed $145,000,000, payable in the year and in the amounts, and evidencing
principal of and interest on the Installment Payment as specified in the Trust Agreement as
finally executed, are hereby authorized and approved.
95713826.4 3
Section 5. The payment of the remaining principal components of the Prior
Installment Payment at maturity, and the interest components thereof, and the Prior Certificates
evidencing interests therein, is hereby authorized and approved.
Section 6. The form of Notice of Intention to Sell, in substantially the form submitted
to this meeting and made a part hereof as though set forth in full herein, with such changes,
insertions and omissions therein as may be approved by an Authorized Officer, is hereby
approved, and the use of the applicable Notice of Intention to Sell in connection with the offering
and sale of a series of the Notes is hereby approved. The Authorized Officers are each hereby
authorized and directed, for and in the name and on behalf of the District, to cause one or more
Notices of Intention to Sell to be published in The Bond Buyer (or in such other financial
publication generally circulated throughout the State of California or reasonably expected to be
disseminated among prospective bidders for the Notes as an Authorized Officer shall approve as
being in the best interests of the District) at least five days prior to the date set for the opening of
bids in the Notice Inviting Bids, with such changes, insertions and omissions therein as an
Authorized Officer may require or approve, such requirement or approval to be conclusively
evidenced by such publishing of the Notice of Intention to Sell.
Section 7. The Notice Inviting Bids, in substantially the form submitted to this
meeting and made a part hereof as though set forth herein, with such changes, insertions and
omissions therein as may be approved by an Authorized Officer, be and the same is hereby
approved, and the use of one or more Notices Inviting Bids in connection with the offering and
sale of the Notes is hereby authorized and approved. The terms and conditions of the offering
and sale of the Notes shall be as specified in the applicable Notice Inviting Bids. Bids for the
purchase of the Notes shall be received at the time and place set forth in the applicable Notice
Inviting Bids. The Authorized Officers are each hereby authorized and directed, for and in the
name and on behalf of the District, to accept the bid for the Notes with the lowest true interest
cost, or to reject all bids therefor, in accordance with the terms of the applicable Notice Inviting
Bids.
Section 8. The Preliminary Official Statement, in substantially the form presented to
this meeting and made a part hereof as though set forth in full herein, with such changes,
insertions and omissions therein as may be approved by an Authorized Officer, is hereby
approved, and the use of the Preliminary Official Statement in connection with the offering and
sale of the Notes is hereby authorized and approved. The Authorized Officers are each hereby
authorized to certify on behalf of the District that the Preliminary Official Statement is deemed
final as of its date, within the meaning of Rule 15c2-12 (except for the omission of certain
information permitted by Rule 15c2-12 to be omitted). The Authorized Officers are each hereby
authorized and directed to furnish, or cause to be furnished, to prospective bidders for the Notes
a reasonable number of copies of the Preliminary Official Statement.
Section 9. The preparation and delivery of a final Official Statement (the "Official
Statement"), and its use in connection with the offering and sale of the Notes, be and the same is
hereby authorized and approved. The Official Statement shall be in substantially the form of the
Preliminary Official Statement, with such changes, insertions and omissions as may be approved
by an Authorized Officer, such approval to be conclusively evidenced by the execution and
delivery thereof. The Authorized Officers are, and each of them is, hereby authorized and
95713826.4 4
directed to execute the final Official Statement and any amendment or supplement thereto, for
and in the name of the District.
Section 10. The Continuing Disclosure Agreement, in substantially the form submitted
to this meeting and made a part hereof as though set forth herein, be and the same is hereby
approved. The Authorized Officers are, and each of them is, hereby authorized and directed, for
and in the name of the District, to execute and deliver the Continuing Disclosure Agreement in
the form submitted to this meeting, with such changes, insertions and omissions as the
Authorized Officer executing the same may require or approve, such requirement or approval to
be conclusively evidenced by the execution of the Continuing Disclosure Agreement by such
Authorized Officer.
Section 11. The Authorized Officers are, and each of them hereby is, authorized and
directed to execute and deliver any and all documents and instruments and to do and cause to be
done any and all acts and things necessary or proper for carrying out the execution and delivery
of the Notes and the transactions contemplated by the notices, agreements and documents
referenced in this Resolution. The Authorized Officers are further authorized and directed to
execute and deliver such additional notes as may be necessary or desirable to pay the Notes at
maturity; provided, however, that the documents executed and delivered in connection with any
such notes shall be in the form approved pursuant to this Resolution in connection with the
Notes.
Section 12. All actions heretofore taken by the officers and employees of the District
with respect to the execution, delivery and sale of the Notes, or in connection with or related to
any of the agreements or documents referenced in this Resolution, are hereby approved,
confirmed and ratified.
Section 13. This Resolution shall take effect immediately upon its adoption.
95713826.4 5
PASSED AND ADOPTED at a regular meeting held on September 26, 2012.
Chair
ATTEST:
Clerk of the Board
APPROVED:
General Counsel, Orange County
Sanitation District
95713826.4 6
STATE OF CALIFORNIA )
ss
COUNTY OF ORANGE )
1, Maria E. Ayala, Clerk of the Board of Directors of the Orange County Sanitation
District, do hereby certify that the foregoing Resolution No. OCSD 12-12 was passed and
adopted at a regular meeting of said Board on the 26t' day of September, 2012, by the
following vote, to wit:
AYES:
NOES:
ABSTENTIONS:
ABSENT:
IN WITNESS WHEREOF, I have hereunto set my hand and affixed the official seal of
Orange County Sanitation District this 26t'day of September, 2012.
Clerk of the Board of Directors
Orange County Sanitation District
95713826.4
RESOLUTION NO. FC-19
A RESOLUTION OF THE BOARD OF DIRECTORS OF THE ORANGE
COUNTY SANITATION DISTRICT FINANCING CORPORATION
AUTHORIZING THE EXECUTION AND DELIVERY BY THE
CORPORATION OF AN INSTALLMENT PURCHASE AGREEMENT
AND A TRUST AGREEMENT IN CONNECTION WITH THE
EXECUTION AND DELIVERY OF ORANGE COUNTY SANITATION
DISTRICT REVENUE REFUNDING CERTIFICATE ANTICIPATION
NOTES, SERIES 2012C, AUTHORIZING THE EXECUTION AND
DELIVERY OF SUCH NOTES EVIDENCING PRINCIPAL IN AN
AGGREGATE AMOUNT OF NOT TO EXCEED $145,000,000 AND
AUTHORIZING THE EXECUTION OF OTHER NECESSARY
DOCUMENTS AND RELATED ACTIONS
WHEREAS, to refinance the acquisition, construction and installation of certain
improvements to its wastewater system (the "Prior Project") the Orange County Sanitation
District (the "District") caused the execution and delivery of$143,205,000 in aggregate principal
amount of Orange County Sanitation District Revenue Refunding Certificate Anticipation Notes,
Series 201113, of which $143,205,000 in principal amount is currently outstanding (the "Prior
Certificates");
WHEREAS, the District desires to pay at maturity all of the Prior Certificates by paying
all of the principal component of the installment payment relating to the Prior Certificates (the
"Prior Installment Payment"), and the interest component thereof, thereby causing all of the Prior
Certificates to be paid;
WHEREAS, to provide the funds necessary to pay the Prior Installment Payment to be
so paid, the District and the Orange County Sanitation District Financing Corporation (the
"Corporation") desire that the Corporation purchase the Prior Project from the District and the
District sell the Prior Project to the Corporation, and that the District then purchase the Prior
Project from the Corporation and the Corporation sell the Prior Project to the District, for the
installment payments (the "Installment Payment") to be made by the District, pursuant to a new
installment purchase agreement (the "Installment Purchase Agreement"), and the Corporation
and the District have agreed to finance such payment by causing the execution and delivery of up
to $145,000,000 in aggregate principal amount of Orange County Sanitation District Revenue
Refunding Certificate Anticipation Notes, Series 2012C (the "Notes") to be repaid from future
certificates of participation, other notes or obligations or lawfully available funds of the District;
WHEREAS, the Corporation intends to assign without recourse certain of its rights
under and pursuant to the Installment Purchase Agreement to Union Bank, N.A., as trustee (the
"Trustee"), pursuant to a Trust Agreement by and among the Trustee, the Corporation and the
District (such Trust Agreement, in the form presented to this meeting, with such changes,
insertions and omissions as are made pursuant to this Resolution, being referred to herein as the
"Trust Agreement");
95713819.4
WHEREAS, in consideration of such assignment and the execution and delivery of the
Trust Agreement, the Trustee will be instructed to execute and deliver the Notes, evidencing
direct, undivided fractional interests in the Installment Payment, and the interest thereon;
WHEREAS, the Corporation desires to assist the District to provide for the public sale of
the Notes;
WHEREAS, there have been prepared and submitted to this meeting forms of-
(a) the Installment Purchase Agreement; and
(b) the Trust Agreement.
WHEREAS, all acts, conditions and things required by the Constitution and laws of the
State of California to exist, to have happened and to have been performed precedent to and in
connection with the consummation of the actions authorized hereby do exist, have happened and
have been performed in regular and due time, form and manner as required by law, and the
Corporation is now duly authorized and empowered, pursuant to each and every requirement of
law, to consummate such actions for the purpose, in the manner and upon the terms herein
provided.
NOW, THEREFORE, THE BOARD OF DIRECTORS OF THE CORPORATION
DOES HEREBY RESOLVE, DETERMINE AND ORDER:
Section 1. All of the recitals herein contained are true and correct and the Board of
Directors of the Corporation(the"Board") so finds.
Section 2. The Installment Purchase Agreement, in substantially the form submitted
to this meeting and made a part hereof as though set forth herein, be and the same is hereby
approved. The President of the Corporation, the Vice-President of the Corporation, the Treasurer
of the Corporation and the Secretary of the Corporation, and such other officers of the
Corporation as the President may designate (the "Authorized Officers") are, and each of them is,
hereby authorized and directed, for and in the name of the Corporation, to execute and deliver
the Installment Purchase Agreement in the form submitted to this meeting, with such changes,
insertions and omissions as the Authorized Officer executing the same may require or approve,
such requirement or approval to be conclusively evidenced by the execution of the Installment
Purchase Agreement by such Authorized Officer; provided, however, that such changes,
insertions and omissions shall not result in an aggregate principal amount of Installment
Payments in excess of $145,000,000, shall not result in a true interest cost for the Installment
Payments in excess of 2.0% per annum and shall not result in a final Installment Payment later
than November 8, 2013.
Section 3. The Trust Agreement, in substantially the form submitted to this meeting
and made a part hereof as though set forth in full herein, be and the same is hereby approved.
The Authorized Officers are, and each of them is, hereby authorized and directed, for and in the
name of the Corporation, to execute and deliver the Trust Agreement in the form presented to
this meeting, with such changes, insertions and omissions as the Authorized Officer executing
95713819.4 2
the same may require or approve, such requirement or approval to be conclusively evidenced by
the execution of the Trust Agreement by such Authorized Officer.
Section 4. The execution and delivery of Notes evidencing principal in an aggregate
amount of not to exceed $145,000,000, payable in the year and in the amounts, and evidencing
direct, undivided fractional interests in the Installment Payment, and the interest thereon, as
specified in the Trust Agreement as finally executed, are hereby authorized and approved.
Section 5. The Authorized Officers of the Corporation are, and each of them hereby
is, authorized and directed to execute and deliver any and all documents and instruments and to
do and cause to be done any and all acts and things necessary or proper for carrying out the
execution and delivery of the Notes and the transactions contemplated by the agreements or
documents referenced in this Resolution. The Authorized Officers are further authorized and
directed to assist the District in delivering such additional notes as may be necessary or desirable
to pay the Notes at maturity; provided, however, that the documents executed and delivered in
connection with any such notes shall be in the form approved pursuant to this Resolution in
connection with the Notes.
Section 6. All actions heretofore taken by the officers and agents of the Corporation
with respect to the execution, delivery and sale of the Notes, or in connection with or related to
any of the agreements or documents referenced in this Resolution, are hereby approved,
confirmed and ratified.
Section 7. This Resolution shall take effect immediately upon its adoption.
95713819.4 3
PASSED AND ADOPTED at a meeting held on September 26, 2012.
President, Orange County Sanitation
District Financing Corporation
ATTEST:
Secretary, Orange County Sanitation
District Financing Corporation
APPROVED:
General Counsel, Orange County
Sanitation District Financing
Corporation
95713819.4 4
STATE OF CALIFORNIA )
ss
COUNTY OF ORANGE )
I, Maria E. Ayala Secretary of the Orange County Sanitation District Financing
Corporation, do hereby certify that the foregoing Resolution No. FC-19 was passed and adopted
at a regular meeting of said Board on the 261h day of September, 2012, by the following vote,
to wit:
AYES:
NOES:
ABSTENTIONS:
ABSENT:
IN WITNESS WHEREOF, I have hereunto set my hand and affixed the official seal of
Orange County Sanitation District Financing Corporation this 261h day of September, 2012.
Secretary of the
Orange County Sanitation District
Financing Corporation
95713819.4
Fulbright & Jaworski L.L.P.— Draft 09/19/t2
TRUST AGREEMENT
by and among
UNION BANK,N.A.,
as Trustee,
ORANGE COUNTY SANITATION DISTRICT
FINANCING CORPORATION
and
ORANGE COUNTY SANITATION DISTRICT
Dated as of October 1, 2012
Relating to
[PAR]
Orange County Sanitation District
Revenue Refunding Certificate Anticipation Notes, Series 2012C
95713399.4
TABLE OF CONTENTS
Page
ARTICLE I
DEFINITIONS; EQUAL SECURITY
Section1.01. Definitions........................................................................................................ 2
Section 1.02. Definitions in Installment Purchase Agreement.............................................. 8
Section1.03. Equal Security.................................................................................................. 8
ARTICLE II
TERMS AND CONDITIONS OF NOTES
Section 2.01. Preparation and Delivery of Notes................................................................... 9
Section 2.02. Denomination, Medium and Dating of Notes.................................................. 9
Section 2.03. Payment Date of Notes; Interest Computation................................................ 9
Section2.04. Form of Notes.................................................................................................. 9
Section 2.05. Execution of Notes and Replacement Notes.................................................... 9
Section 2.06. Transfer and Payment of Notes; Exchange of Notes....................................... 9
Section 2.07. Note Registration Books................................................................................ 10
Section2.08. Reserved......................................................................................................... 10
Section 2.09. Notes Mutilated, Lost, Destroyed or Stolen................................................... 10
Section 2.10. Book-Entry System........................................................................................ 11
ARTICLE III
PROCEEDS OF NOTES
Section 3.01. Delivery of Notes........................................................................................... 13
Section 3.02. Deposit and Transfer of Proceeds of Notes ................................................... 13
Section 3.03. Costs of Issuance Fund.................................................................................. 13
ARTICLE IV
NO PREPAYMENT OF NOTES
Section 4.01. No Prepayment............................................................................................... 13
ARTICLE V
ASSIGNMENT AND PLEDGE; FUNDS AND ACCOUNTS
Section 5.01. Assignment and Pledge.................................................................................. 14
Section 5.02. Installment Payment Fund............................................................................. 14
Section5.03. Reserved......................................................................................................... 15
Section5.04. Reserved......................................................................................................... 15
Section 5.05. Investment of Moneys.................................................................................... 15
Section 5.06. Brokerage Confirmations............................................................................... 15
ARTICLE VI
COVENANTS
Section 6.01. Compliance with Trust Agreement................................................................ 16
Section 6.02. Compliance with Installment Purchase Agreement....................................... 16
Section 6.03. Compliance with Master Agreement............................................................. 16
95713399.4 i
TABLE OF CONTENTS
(continued)
Page
Section 6.04. Observance of Laws and Regulations............................................................ 16
Section6.05. Other Liens..................................................................................................... 16
Section 6.06. Prosecution and Defense of Suits .................................................................. 16
Section 6.07. Accounting Records and Statements ............................................................. 16
Section6.08. Tax Covenants ............................................................................................... 17
Section 6.09. Continuing Disclosure ................................................................................... 20
Section 6.10. Further Assurances.........................................................................................20
ARTICLE VII
DEFAULT AND LIMITATIONS OF LIABILITY
Section 7.01. Action upon Event of Default........................................................................20
Section 7.02. Other Remedies of the Trustee ......................................................................21
Section7.03. Non-Waiver....................................................................................................21
Section 7.04. Remedies Not Exclusive................................................................................21
Section 7.05. Application of Amounts After Default..........................................................22
Section 7.06. Trustee May Enforce Claims Without Possession of Notes..........................22
Section 7.07. Limitation on Suits......................................................................................... 22
Section 7.08. No Liability by the Corporation to the Owner............................................... 23
Section 7.09. No Liability by the District to the Owners..................................................... 23
Section 7.10. No Liability of the Trustee to the Owners..................................................... 23
ARTICLE VIII
THE TRUSTEE
Section 8.01. Employment of the Trustee; Duties...............................................................23
Section 8.02. Removal and Resignation of the Trustee.......................................................24
Section 8.03. Compensation and Indemnification of the Trustee........................................ 25
Section 8.04. Protection of the Trustee................................................................................ 25
ARTICLE IX
AMENDMENT OF OR SUPPLEMENT TO TRUST AGREEMENT
Section 9.01. Amendment or Supplement........................................................................... 27
Section 9.02. Disqualified Notes ......................................................................................... 28
Section 9.03. Endorsement or Replacement of Notes After Amendment or
Supplement ....................................................................................................28
Section 9.04. Amendment by Mutual Consent....................................................................28
ARTICLE X
DEFEASANCE
Section 10.01. Discharge of Notes and Trust Agreement......................................................28
Section 10.02. Unclaimed Moneys........................................................................................ 30
ARTICLE XI
MISCELLANEOUS
Section 11.01. Benefits of Trust Agreement.......................................................................... 30
95713399.4 ii
TABLE OF CONTENTS
(continued)
Page
Section 11.02. Successor Deemed Included in all References to Predecessor...................... 30
Section 11.03. Execution of Documents by Owners ............................................................. 30
Section 11.04. Waiver of Personal Liability.......................................................................... 31
Section11.05. Reserved......................................................................................................... 31
Section 11.06. Content of Written Certificates...................................................................... 31
Section 11.07. Funds and Accounts....................................................................................... 31
Section 11.08. Article and Section Headings, Gender and References ................................. 32
Section 11.09. Partial Invalidity............................................................................................. 32
Section 11.10. California Law............................................................................................... 32
Section11.11. Notices ........................................................................................................... 32
Section 11.12. Effective Date ................................................................................................ 33
Section 11.13. Execution in Counterparts.............................................................................. 33
EXHIBIT A—FORM OF NOTE
95713399.4 111
TRUST AGREEMENT
THIS TRUST AGREEMENT (this "Trust Agreement"), is dated as of October 1, 2012,
by and among UNION BANK, N.A., a national banking association organized and existing
under the laws of the United States of America, as Trustee (the "Trustee"), the ORANGE
COUNTY SANITATION DISTRICT FINANCING CORPORATION, a nonprofit public
benefit corporation organized and existing under the laws of the State of California (the
"Corporation"), and the ORANGE COUNTY SANITATION DISTRICT, a county sanitation
district organized and existing under the laws of the State of California(the "District").
WITNESSETH:
WHEREAS, to refinance the acquisition, construction and installation of certain
improvements to its wastewater system (the "Prior Project") the District caused the execution
and delivery of $143,205,000 in aggregate principal amount of Orange County Sanitation
District Revenue Refunding Certificate Anticipation Notes, Series 2011B, of which
$143,205,000 in principal amount is currently outstanding (the "Prior Notes");
WHEREAS, the District desires to pay at maturity all of the Prior Notes by paying all of
the principal component of the installment payment relating to the Prior Notes (the "Prior
Installment Payment"), and the interest component thereof, thereby causing all of the Prior Notes
to be paid;
WHEREAS, to provide the funds necessary to pay the Prior Installment Payment, the
District and the Corporation desire that the Corporation purchase the Prior Project from the
District and the District sell the Prior Project to the Corporation, and that the District then
purchase the Prior Project from the Corporation and the Corporation sell the Prior Project to the
District, for the installment payment (the "Installment Payment") to be made by the District,
pursuant to a new installment purchase agreement (the "Installment Purchase Agreement"), and
the Corporation and the District have agreed to finance such payment by causing the execution
and delivery of [PAR] in aggregate principal amount of Orange County Sanitation District
Revenue Refunding Certificate Anticipation Notes, Series 2012C (the "Notes") evidencing
direct, fractional undivided interests in the Installment Payment and the interest thereon, to be
made by the District pursuant to the Installment Purchase Agreement;
WHEREAS, pursuant to the Master Agreement for District Obligations, dated as of
August 1, 2000, by and between the District and the Corporation, the District has established and
declared the conditions and terms upon which obligations such as the Installment Purchase
Agreement, and the Installment Payment, and the interest thereon, are to be incurred and
secured;
WHEREAS, the Corporation proposes to assign without recourse certain of its rights
under and pursuant to the Installment Purchase Agreement to the Trustee; and
WHEREAS, all acts, conditions and things required by law to exist, to have happened
and to have been performed precedent to and in connection with the execution and delivery of
this Trust Agreement do exist, have happened and have been performed in regular and due time,
95713399.4
form and manner as required by law, and the parties hereto are now duly authorized to execute
and deliver this Trust Agreement;
NOW, THEREFORE, in consideration of the premises and of the mutual agreements
and covenants contained herein and for other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties hereto do hereby agree as follows:
ARTICLE I
DEFINITIONS; EQUAL SECURITY
Section 1.01. Definitions. Except as provided in Section 1.02 hereof or unless the
context otherwise requires, the terms defined in this Section shall for all purposes hereof and of
any amendment hereof or supplement hereto and of the Notes and of any certificate, opinion,
request or other document mentioned herein or therein have the meanings defined herein, the
following definitions to be equally applicable to both the singular and plural forms of any of the
terms defined herein:
"Authorized Corporation Representative" means the President, the Vice President, the
Treasurer and the Secretary of the Corporation, and any other Person authorized by the President
of the Corporation to act on behalf of the Corporation under or with respect to this Trust
Agreement.
"Authorized Denominations" means $5,000 and integral multiples thereof.
"Authorized District Representative" means the General Manager of the District, the
Director of Finance and Administrative Services of the District, the Controller of the District and
any other Person authorized by the Director of Finance and Administrative Services of the
District to act on behalf of the District under or with respect to this Trust Agreement.
"Beneficial Owners" means those individuals, partnerships, corporations or other
entities for which the Participants have caused the Depository to hold Book-Entry Notes.
"Book-Entry Notes" means the Notes registered in the name of the nominee of DTC, or
any successor securities depository for the Notes, as the Owner thereof pursuant to the terms and
provisions of Section 2.10 hereof.
"Business Day" means a day other than (a) Saturday or Sunday, (b) a day on which
banking institutions in the city in which the Principal Office is located are authorized or required
by law to be closed, and (c) a day on which the New York Stock Exchange is authorized or
obligated by law or executive order to be closed.
"Cede & Co." means Cede & Co., the nominee of DTC, and any successor nominee of
DTC with respect to the Notes.
"Closing Date" means October 30, 2012.
"Code" means the Internal Revenue Code of 1986.
95713399.4 2
"Continuing Disclosure Agreement" means the Continuing Disclosure Agreement,
dated as of the date hereof, by and between the District and Digital Assurance Certification LLC,
as dissemination agent thereunder, as originally executed and as it may from time to time be
amended in accordance with the terms thereof.
"Corporation" means the Orange County Sanitation District Financing Corporation, a
nonprofit public benefit corporation organized and existing under the laws of the State.
"Costs of Issuance" means all the costs of executing and delivering the Notes, including,
but not limited to, all printing and document preparation expenses in connection with this Trust
Agreement, the Installment Purchase Agreement, the Notes and any preliminary official
statement and final official statement pertaining to the Notes, rating agency fees, market study
fees, legal fees and expenses of counsel with respect to the execution and delivery of the Notes,
the initial fees and expenses of the Trustee and its counsel and other fees and expenses incurred
in connection with the execution and delivery of the Notes, to the extent such fees and expenses
are approved by the District.
"Costs of Issuance Fund" means the fund by that name established in accordance with
Section 3.03 hereof.
"Depository" means the securities depository acting as Depository pursuant to
Section 2.10 hereof.
"District" means the Orange County Sanitation District, a county sanitation district
organized and existing under the laws of the State, and any successor thereto.
"DTC" means The Depository Trust Company,New York,New York and its successors.
"Event of Default" shall have the meaning set forth in Section 6.01 of the Installment
Purchase Agreement.
"Government Obligations" means any of the following which are noncallable by the
issuer thereof except to the extent not permitted by the laws of the State as an investment for the
moneys to be invested therein at the time of investment:
(i) (a) direct general obligations of the United States of America,
(b) obligations the payment of the principal of and interest on which are unconditionally
guaranteed as to the full and timely payment by the United States of America or (c) any
fund or other pooling arrangement whose assets consist exclusively of the obligations
listed in clause (a) or (b) of this clause (i) and which is rated at least "P-l" by Moody's;
provided that, such obligations shall not include unit investment trusts or mutual fund
obligations;
(ii) advance refunded tax-exempt obligations that (a) are rated by Moody's
and S&P, (b) are secured by obligations specified in clause (i), (c) are tax-exempt
because they are secured by obligations specified in clause (i) and (d) have the same
ratings as the obligations specified in clause (i);
95713399.4 3
(iii) bonds, debentures or notes issued by any of the following federal
agencies: Federal Farm Credit Bank, Federal Home Loan Mortgage Corporation or
Federal National Mortgage Association; provided, that such bonds, debentures or notes
shall be the senior obligations of such agencies (including participation certificates) and
have the same ratings by Moody's and S&P as the obligations specified in clause (i); and
(iv) bonds, debentures or notes issued by any Federal agency hereafter created
by an act of Congress, the payment of the principal of and interest on which are
unconditionally guaranteed by the United States of America as to the full and timely
payment; provided, that, such obligations shall not include unit investment trusts or
mutual fund obligations.
"Installment Payment Fund" means the fund by that name established in accordance
with Section 5.02 hereof.
"Installment Payment" means the Installment Payment required to be made by the
District pursuant to Section 3.02 of the Installment Purchase Agreement.
"Installment Purchase Agreement" means the Installment Purchase Agreement, dated
as of the date hereof, by and between the District and the Corporation, as originally executed and
as it may from time to time be amended in accordance with the provisions thereof.
"Interest Account" means the account by that name within the Installment Payment
Fund established in accordance with Section 5.02 hereof.
"Letter of Representations" means the letter of the District delivered to and accepted by
the Depository on or prior to the delivery of the Notes as Book-Entry Notes setting forth the
basis on which the Depository serves as depository for such Book-Entry Notes, as originally
executed or as it may be supplemented or revised or replaced by a letter to a substitute
Depository.
"Master Agreement" means the Master Agreement for District Obligations, dated as of
August 1, 2000, by and between the District and the Corporation, as originally executed and as it
may from time to time be amended or supplemented in accordance with the terms thereof.
"Maturity Date" means October 30, 2013.
"Moody's" means Moody's Investors Service, a corporation organized and existing
under the laws of the State of Delaware, its successors and assigns, except that if such
corporation shall no longer perform the function of a securities rating agency for any reason, the
term "Moody's" shall be deemed to refer to any other nationally recognized securities rating
agency selected by the District.
"Nominee" means the nominee of the Depository, which may be the Depository, as
determined from time to time pursuant to Section 2.10 hereof.
"Notes" means the Orange County Sanitation District Revenue Refunding Certificates of
Participation (Certificate Anticipation Notes), Series 2012C, also known as the Orange County
95713399.4 4
Sanitation District Revenue Refunding Certificate Anticipation Notes, Series 2012C, executed
and delivered by the Trustee pursuant hereto.
"Opinion of Counsel" means a written opinion of Fulbright & Jaworski L.L.P. or any
other counsel of recognized national standing in the field of law relating to municipal bonds,
appointed and paid by the District.
"Outstanding," when used as of any particular time with reference to Notes, means
(subject to the provisions of Section 9.02 hereof) all Notes except (a)Notes previously canceled
by the Trustee or delivered to the Trustee for cancellation, (b)Notes paid or deemed to have been
paid within the meaning of Section 10.01 hereof, and (c)Notes in lieu of or in substitution for
which other Notes shall have been executed and delivered by the Trustee pursuant to
Section 2.09 hereof.
"Owner" means any Person who shall be the registered owner of any Outstanding Note
as indicated in the registration books of the Trustee required to be maintained pursuant to
Section 2.07 hereof.
"Participants" means those broker-dealers, banks and other financial institutions from
time to time for which the Depository holds Book-Entry Notes as securities depository.
"Participating Underwriter" has the meaning ascribed thereto in the Continuing
Disclosure Agreement.
"Permitted Investments" means any of the following, except to the extent not permitted
by the laws of the State as an investment for the moneys to be invested therein at the time of
investment:
(1) Government Obligations;
(2) Bonds, debentures, notes, participation certificates or other evidences of
indebtedness issued, or the principal of and interest on which are unconditionally
guaranteed, by the Federal Intermediate Credit Bank, the Federal Home Loan Bank
System, the Government National Mortgage Association or any other agency or
instrumentality of or corporation wholly owned by the United States of America when
such obligations are backed by the full faith and credit of the United States for the full
and timely payment of principal and interest;
(3) Obligations of any state of the United States or any political subdivision
thereof, which at the time of investment are rated "Aa3" or higher by Moody's and
"AA-" or higher by S&P; or which are rated by Moody's "VMIGI" or better and by S&P
"A-1+" or better with respect to commercial paper, or "VMIG1" and "SP-1",
respectively, with respect to municipal notes;
(4) Bank time deposits evidenced by certificates of deposit, deposit accounts,
and bankers' acceptances, issued by any bank, trust company or national banking
association insured by the Federal Deposit Insurance Corporation (including the Trustee);
provided that (a) such bank, trust company or national banking association be rated
95713399.4 5
"Aa3" or better by Moody's and "AA-" or better by S&P; and (b) the aggregate of such
bank time deposits and bankers' acceptances issued by any bank, trust company or
banking association does not exceed at any one time 10% of the aggregate of the capital
stock, surplus and undivided profits of such bank, trust company or banking association
and that such capital stock, surplus and undivided profits shall not be less than
$15,000,000;
(5) Repurchase agreements with any bank, trust company or national banking
association insured by the Federal Deposit Insurance Corporation (including the Trustee),
with subsidiaries (of a parent company), provided the obligations of the subsidiary under
the agreement are unconditionally guaranteed by the parent, or with any government
bond dealer recognized as a primary dealer by the Federal Reserve Bank of New York,
which agreements are fully and continuously secured by a valid and perfected first
priority security interest in obligations described in paragraph (1) or (2) of this definition,
provided that either such bank, trust company or national banking association which (or
senior debt or claims paying ability of the financial entity's guarantor) is rated, at the time
of investment, "Aa3" or better by Moody's and"AA-" or better by S&P;
(6) Repurchase agreements with maturities of not more than one year entered
into with financial institutions such as banks or trust companies organized under state law
or national banks or banking associations (including the Trustee), insurance companies or
government bond dealers reporting to, trading with, and recognized as a primary dealer
by, the Federal Reserve Bank of New York and a member of the Securities Investor
Protection Corporation or with a dealer or parent holding company that is rated, at the
time of investment, or whose long-term debt obligations (or senior debt or claims paying
ability of the financial entity's guarantor) are rated, at the time of investment, "Aa3" or
better by Moody's and"AA-" or better by S&P,provided such repurchase agreements are
in writing, secured by obligations described in paragraphs (1) and (2) of this definition
having a fair market value, exclusive of accrued interest, at least equal to the amount
invested in the repurchase agreements and in which the Trustee has a perfected first lien
in, and retains possession of, such obligations free from all third party claims;
(7) Investment agreements, forward purchase agreements and reserve fund put
agreements with any corporation, including banking or financial institutions, or
agreements entered into with subsidiaries (of a parent company), provided the obligations
of the subsidiary under the agreement are unconditionally guaranteed by the parent, the
corporate debt of which (or senior debt or claims paying ability of the financial entity's
guarantor) is rated, at the time of investment, "Aa3" or better by Moody's and "AA-" or
better by S&P;
(8) Guaranteed investment contracts or similar funding agreements issued by
insurance companies, provided that either the long term corporate debt of such insurance
company, at the time of investment, is rated, at the time of investment, "Aa3" or better by
Moody's and "AA-" or better by S&P or which agreements are fully and continuously
secured by a valid and perfected first priority security interest in obligations described in
paragraph(1) or (2) of this definition, or that the following conditions are met: (a)the
market value of the collateral is maintained at levels acceptable to Moody's and S&P,
95713399.4 6
(b)the Trustee or a third party acting solely as agent for the Trustee has possession of the
collateral, (c) the Trustee has a perfected first priority security interest in the collateral,
(d)the collateral is free and clear of third-party liens, and (e) failure to maintain the
requisite collateral level will require the Trustee to liquidate collateral;
(9) Corporate commercial paper rated"P-1" or better by Moody's and "A-1+"
or better by S&P at the time of investment;
(10) Taxable government money market portfolios which are rated"AAAm" or
"AAAm-G"by S&P and "P-1"by Moody's (including funds for which the Trustee or an
affiliate provides investment advice or similar services);
(11) Deposits with the Local Agency Investment Fund of the State, as may
otherwise be permitted by law; and
(12) Shares in the Blackrock T-Fund.
"Person" means an individual, corporation, limited liability company, firm, association,
partnership, trust, or other legal entity or group of entities, including a governmental entity or
any agency or political subdivision thereof.
"Principal Account" means the account by that name within the Installment Payment
Fund established in accordance with Section 5.02 hereof.
"Principal Office" means the Trustee's principal corporate trust office in Los Angeles,
California.
"Prior Notes" has the meaning ascribed thereto in the recitals hereto.
"Prior Notes Trustee" means Union Bank,N.A., as trustee for the Prior Notes.
"Record Date" means, with respect to the interest payable on the Maturity Date, the 15tn
day of such calendar month.
"S&P" means Standard & Poor's Ratings Services, a division of The McGraw-Hill
Companies, Inc., a corporation organized and existing under the laws of the State of New York,
its successors and assigns, except that if such entity shall no longer perform the functions of a
securities rating agency for any reason, the term "S&P" shall be deemed to refer to any other
nationally recognized securities rating agency selected by the District.
"State"means the State of California.
"Tax Certificate" means the Tax Certificate executed by the District at the time of
execution and delivery of the Notes relating to the requirements of section 148 of the Code, as
originally executed and as it may from time to time be amended in accordance with the
provisions thereof.
95713399.4 7
"Trust Agreement" means this Trust Agreement, dated as of October 1, 2012, by and
among the Trustee, the Corporation and the District, as originally executed and delivered and as
it may from time to time be amended or supplemented in accordance with the provisions hereof.
"Trustee" means Union Bank, N.A., a national banking association duly organized and
existing under the laws of the United States of America, or any other bank or trust company
which may at any time be substituted in its place as provided in Section 10.02 hereof.
"Written Certificate" and"Written Request" mean (a)with respect to the Corporation,
a written certificate or written request, respectively, signed in the name of the Corporation by an
Authorized Corporation Representative, and (b) with respect to the District, a written certificate
or written request, respectively, signed in the name of the District by an Authorized District
Representative. Any such certificate or request may, but need not, be combined in a single
instrument with any other instrument, opinion or representation, and the two or more so
combined shall be read and construed as a single instrument.
Section 1.02. Definitions in Installment Purchase Agreement. Except as otherwise
herein defined and unless the context otherwise requires, the terms defined in the Installment
Purchase Agreement shall for all purposes hereof and of any amendment hereof or supplement
hereto and of any report or other document mentioned herein have the meanings defined therein,
such definitions to be equally applicable to both the singular and plural forms of any of the terms
defined therein. With respect to any defined term which is given a different meaning under this
Trust Agreement than under the Installment Purchase Agreement, as used herein it shall have the
meaning given herein.
Section 1.03. Equal Security. In consideration of the acceptance of the Notes by the
Owners, this Trust Agreement shall be deemed to be and shall constitute a contract between the
Trustee and the Owners to secure the full and final payment of the interest and principal
evidenced by the Notes which may be executed and delivered hereunder, subject to each of the
agreements, conditions, covenants and terms contained herein; and all agreements, conditions,
covenants and terms contained herein required to be observed or performed by or on behalf of
the Trustee shall be for the equal and proportionate benefit, protection and security of all Owners
without distinction, preference or priority as to security or otherwise of any Notes over any other
Notes by reason of the number or date thereof or the time of execution or delivery thereof or for
any cause whatsoever, except as expressly provided herein or therein.
95713399.4 8
ARTICLE II
TERMS AND CONDITIONS OF NOTES
Section 2.01. Preparation and Delivery of Notes. The Trustee is hereby authorized,
upon the Written Request of the District, to execute and deliver the Notes in the aggregate
principal amount of [PAR], evidencing the aggregate principal amount of the Installment
Payment and each evidencing a direct, fractional undivided interest in the Installment Payment,
and the interest thereon. The Installment Payment evidenced by each Note shall constitute the
principal evidenced thereby and the interest on such Installment Payment shall constitute the
interest evidenced thereby. The Notes shall be numbered, with or without prefixes, as directed
by the Trustee.
Section 2.02. Denomination, Medium and Dating of Notes. The Notes shall be
designated as the "Orange County Sanitation District Revenue Refunding Certificate
Anticipation Notes, Series 2012C" and shall be prepared in the form of fully registered Notes,
without coupons, in Authorized Denominations and shall be payable in lawful money of the
United States of America. The Notes shall be dated the Closing Date and shall evidence interest
accruing from the Closing Date until the Maturity Date.
Section 2.03. Payment Date of Notes; Interest Computation. Except as otherwise
provided in the Letter of Representations, interest and principal evidenced by the Notes shall
become due and payable on the Maturity Date. Interest evidenced by the Notes shall be
computed on the basis of a 360-day year consisting of twelve 30-day months. Except as
otherwise provided in the Letter of Representations, payment of interest evidenced by the Notes
shall be made to the Owners thereof(as determined at the close of business on the Record Date
next preceding the Maturity Date or any other date fixed for payment) by check or draft of the
Trustee mailed to the address of each such Owner as it appears on the registration books
maintained by the Trustee pursuant to Section 2.07 hereof, or to such other address as may be
furnished in writing to the Trustee by each such Owner. Except as otherwise provided in the
Letter of Representations, payment of principal evidenced by the Notes, on the Maturity Date,
shall be made only upon presentation and surrender of the Notes at the Principal Office.
Section 2.04. Form of Notes. The Notes shall be in substantially the form of Exhibit A
hereto, with necessary or appropriate insertions, omissions and variations as permitted or
required hereby.
Section 2.05. Execution of Notes and Replacement Notes. The Notes shall be
executed by the Trustee by the manual signature of an authorized signatory of the Trustee. The
Trustee shall deliver replacement Notes in the manner and as contemplated by this Article. Such
replacement Notes, shall be executed as herein provided and shall be in Authorized
Denominations.
Section 2.06. Transfer and Payment of Notes, Exchange of Notes. Each Note is
transferable by the Owner thereof, in person or by his attorney duly authorized in writing, at the
Principal Office, on the registration books maintained by the Trustee pursuant to the provisions
of Section 2.07 hereof, upon surrender of such Note for cancellation accompanied by delivery of
95713399.4 9
a duly executed written instrument of transfer in a form acceptable to the Trustee. The Trustee
may treat the Owner of any Note as the absolute owner of such Note for all purposes, whether or
not the principal or interest evidenced by such Note shall be overdue, and the Trustee shall not be
affected by any knowledge or notice to the contrary; and payment of the interest and principal
evidenced by such Note shall be made only to such Owner, which payments shall be valid and
effectual to satisfy and discharge the liability evidenced by such Note to the extent of the sum or
sums so paid.
Whenever any Note shall be surrendered for transfer, the Trustee shall execute and
deliver a new Note or Notes evidencing principal in the same aggregate amount. The Trustee
shall require the payment by any Owner requesting such transfer of any tax or other
governmental charge required to be paid with respect to such transfer.
Each Note may be exchanged at the Principal Office for Notes evidencing principal in a
like aggregate principal amount in such Authorized Denominations as the Owner thereof may
request. The Trustee shall require the payment by the Owner requesting such exchange of any
tax or other governmental charge required to be paid with respect to such exchange.
Section 2.07. Note Registration Books. The Trustee shall keep at its Principal Office
sufficient books for the registration and transfer of the Notes, which books shall be available for
inspection and copying by the District at reasonable hours and under reasonable conditions; and
upon presentation for such purpose the Trustee shall, under such reasonable regulations as it may
prescribe, register or transfer the Notes on such books as hereinabove provided.
Section 2.08. Reserved.
Section 2.09. Notes Mutilated, Lost, Destroyed or Stolen. If any Note shall become
mutilated, the Trustee, at the expense of the Owner thereof, shall execute and deliver a new Note
evidencing a like principal amount and number in exchange and substitution for the Note so
mutilated, but only upon surrender to the Trustee of the Note so mutilated. Every mutilated Note
so surrendered to the Trustee shall be canceled by it. If any Note shall be lost, destroyed or
stolen, evidence of such loss, destruction or theft may be submitted to the Trustee, and if such
evidence is satisfactory to the Trustee and indemnity satisfactory to the Trustee shall be given,
the Trustee, at the expense of the Owner thereof, shall execute and deliver a new Note
evidencing a like principal amount, numbered as the Trustee shall determine, in lieu of and in
substitution for the Note so lost, destroyed or stolen. The Trustee may require payment of a sum
not exceeding the actual cost of preparing each new Note executed and delivered by it under this
Section and of the expenses which may be incurred by it under this Section. Any Note executed
and delivered under the provisions of this Section in lieu of any Note alleged to be lost,
destroyed or stolen shall be equally and proportionately entitled to the benefits hereof with all
other Notes executed and delivered hereunder, and the Trustee shall not be required to treat both
the original Note and any replacement Note as being Outstanding for the purpose of determining
the amount of Notes which may be executed and delivered hereunder or for the purpose of
determining any percentage of Notes Outstanding hereunder, but both the original and
replacement Note shall be treated as one and the same. Notwithstanding any other provision of
this Section, in lieu of executing and delivering a new Note for a Note which has been lost,
95713399.4 10
destroyed or stolen and which evidences principal that is then payable, the Trustee may make
payment of such Note to the Owner thereof if so instructed by the District.
Whenever in this Trust Agreement provision is made for the cancellation by the Trustee
of any Notes, the Trustee shall destroy such Notes and deliver a certificate of such destruction to
the District.
Section 2.10. Book-Entry System. (a) The Notes shall be initially executed and
delivered as Book-Entry Notes, and the Notes shall be in the form of a separate single fully
registered Note. Upon initial execution and delivery of the Notes, the ownership of each Note
shall be registered in the registration books maintained by the Trustee in the name of the
Nominee, as nominee of the Depository. Payment of principal or interest evidenced by any
Book-Entry Note registered in the name of the Nominee shall be made on the Maturity Date by
wire transfer of New York clearing house or equivalent next day funds or by wire transfer of
same day funds to the account of the Nominee. Such payments shall be made to the Nominee at
the address which is, on the Record Date, shown for the Nominee in the registration books
maintained by the Trustee.
(b) With respect to Book-Entry Notes, the District, the Corporation and the Trustee
shall have no responsibility or obligation to any Participant or to any Person on behalf of which
such a Participant holds an interest in such Book-Entry Notes. Without limiting the immediately
preceding sentence, the District, the Corporation and the Trustee shall have no responsibility or
obligation with respect to (i) the accuracy of the records of the Depository, the Nominee or any
Participant with respect to any ownership interest in Book-Entry Notes, (ii)the delivery to any
Participant or any other Person, other than an Owner as shown in the registration books
maintained by the Trustee, of any notice with respect to Book-Entry Notes, (iii) the selection by
the Depository and its Participants of the beneficial interests in Book-Entry Notes to be prepaid
in the event Notes are prepaid in part, (iv) the payment to any Participant or any other Person,
other than an Owner as shown in the registration books maintained by the Trustee, of any
amount with respect to principal or interest evidenced by Book-Entry Notes, or (v) any consent
given or other action taken by the Depository as Owner.
(c) The District, the Corporation and the Trustee may treat and consider the Person in
whose name each Book-Entry Note is registered in the registration books maintained by the
Trustee as the absolute Owner of such Book-Entry Note for the purpose of payment of principal
and interest evidenced by such Note, for the purpose of selecting any Notes, or portions thereof,
to be prepaid, for the purpose of giving notices of matters with respect to such Note, for the
purpose of registering transfers with respect to such Note, for the purpose of obtaining any
consent or other action to be taken by Owners and for all other purposes whatsoever, and the
District, the Corporation and the Trustee shall not be affected by any notice to the contrary.
(d) Reserved.
(e) The Trustee shall pay all principal and interest evidenced by the Notes to the
respective Owner, as shown in the registration books maintained by the Trustee, or his respective
attorney duly authorized in writing, and all such payments shall be valid and effective to fully
satisfy and discharge the obligations with respect to payment of principal and interest evidenced
95713399.4 11
by the Notes to the extent of the sum or sums so paid. No Person other than an Owner, as shown
in the registration books maintained by the Trustee, shall receive a Note evidencing principal and
interest evidenced by the Notes. Upon delivery by the Depository to the Owners, the Trustee and
the District of written notice to the effect that the Depository has determined to substitute a new
nominee in place of the Nominee, and subject to the provisions herein with respect to Record
Date, the word Nominee in this Trust Agreement shall refer to such nominee of the Depository.
(f) To qualify the Book-Entry Notes for the Depository's book-entry system, the
District shall execute and deliver to the Depository a Letter of Representations. The execution
and delivery of a Letter of Representations shall not in any way impose upon the Corporation,
the District or the Trustee any obligation whatsoever with respect to Persons having, interests in
such Book-Entry Notes other than the Owners, as shown on the registration books maintained by
the Trustee. Such Letter of Representations may provide the time, form, content and manner of
transmission, of notices to the Depository. In addition to the execution and delivery of a Letter
of Representations by the District, the District, the Corporation and the Trustee shall take such
other actions, not inconsistent with this Trust Agreement, as are reasonably necessary to qualify
Book-Entry Notes for the Depository's book-entry program.
(g) If the District determines that it is in the best interests of the Beneficial Owners
that they be able to obtain certificated Notes and that such Notes should therefore be made
available and notifies the Depository and the Trustee of such determination, the Depository will
notify the Participants of the availability through the Depository of certificated Notes. In such
event, the Trustee shall transfer and exchange certificated Notes as requested by the Depository
and any other Owners in appropriate amounts. If(i)the Depository determines not to continue to
act as securities depository for Book-Entry Notes, or (ii) the Depository shall no longer so act
and gives notice to the Trustee of such determination, then the District shall discontinue the
Book-Entry system with the Depository. If the District determines to replace the Depository
with another qualified securities depository, the District shall prepare or direct the preparation of
a new single, separate, fully registered Note for such Book-Entry Notes, registered in the name
of such successor or substitute qualified securities depository or its nominee. If the District fails
to identify another qualified securities depository to replace the Depository, then the Notes shall
no longer be restricted to being registered in the registration books maintained by the Trustee in
the name of the Nominee, but shall be registered in whatever name or names the Owners
transferring or exchanging such Notes shall designate, in accordance with the provisions of
Sections 2.06 and 2.09 hereof. Whenever the Depository requests the District to do so, the
District will cooperate with the Depository in taking appropriate action after reasonable notice
(i)to make available one or more separate certificates evidencing the Book-Entry Notes to any
Participant having Book-Entry Notes credited to its account with the Depository, and (ii) to
arrange for another securities depository to maintain custody of certificates evidencing the Book-
Entry Notes.
(h) Notwithstanding any other provision of this Trust Agreement to the contrary, if
DTC is the sole Owner of the Notes, so long as any Book-Entry Note is registered in the name of
the Nominee, all payments of principal and interest evidenced by such Note and all notices with
respect to such Note shall be made and given, respectively, as provided in the Letter of
Representations or as otherwise instructed by the Depository.
95713399.4 12
(i) In connection with any notice or other communication to be provided to Owners
pursuant to the Trust Agreement by the District, the Corporation or the Trustee, with respect to
any consent or other action to be taken by Owners, the Trustee shall establish a record date for
such consent or other action and give the Depository notice of such record date not less than 15
calendar days in advance of such record date to the extent possible. Notice to the Depository
shall be given only when DTC is the sole Owner of the Notes.
ARTICLE III
PROCEEDS OF NOTES
Section 3.01. Delivery of Notes. The Trustee is hereby authorized to execute the Notes
and deliver them to the original purchaser thereof upon receipt of a Written Request of the
District and on receipt of the proceeds of sale of the Notes.
Section 3.02. Deposit and Transfer of Proceeds of Notes. The net proceeds received
by the Trustee from the sale of the Notes in the amount of$ shall be transferred
on the Closing Date to the Prior Notes Trustee for deposit in the Installment Payment Fund
relating to the Prior Notes.
In addition, on the Closing Date the Trustee shall deposit in the Costs of Issuance Fund
the amount of$ received from the District as an equity contribution.
Section 3.03. Costs of Issuance Fund. The Trustee shall establish and maintain a
separate special fund to be held by the Trustee known as the Costs of Issuance Fund. There shall
be deposited in the Costs of Issuance Fund on the Closing Date the amount required to be
deposited therein pursuant to Section 3.02 hereof. The Trustee shall disburse moneys from the
Costs of Issuance Fund on such dates and in such amounts as are necessary to pay Costs of
Issuance, in each case upon the Written Request of the District stating the Person to whom
payment is to be made, the amount to be paid, the purpose for which the obligation was incurred
and that such payment is a proper charge against the Costs of Issuance Fund. On the date that is
six months after the Closing Date, the Trustee shall transfer any amounts then remaining in the
Costs of Issuance Fund to the Installment Payment Fund. Upon such transfer, the Costs of
Issuance Fund shall be closed.
ARTICLE IV
NO PREPAYMENT OF NOTES
Section 4.01. No Prepayment. The Notes are not subject to prepayment prior to the
Maturity Date.
95713399.4 13
ARTICLE V
ASSIGNMENT AND PLEDGE; FUNDS AND ACCOUNTS
Section 5.01. Assignment and Pledge. The Corporation hereby transfers, conveys and
assigns to the Trustee, for the benefit of the Owners, all of the Corporation's rights, title and
interest in and to the Installment Purchase Agreement (excepting its rights to indemnification
thereunder), including the right to receive the Installment Payment, and the interest thereon, from
the District and the right to exercise any remedies provided therein in the event of a default by
the District thereunder. The Trustee hereby accepts said transfer, conveyance and assignment,
solely in its capacity as Trustee, for the benefit of the Owners, subject to the provisions of this
Trust Agreement. All of the Installment Payment, and the interest thereon, shall be paid directly
by the District to the Trustee, and if received by the Corporation at any time shall be deposited
by the Corporation with the Trustee immediately upon the receipt thereof.
To secure the respective rights of the Owners to the payments required to be made thereto
as provided herein, the Corporation and the District hereby irrevocably pledge to the Trustee, for
the benefit of the Owners, all of their right, title and interest, if any, in and to all amounts on
deposit from time to time in the funds and accounts established hereunder. This pledge shall
constitute a first lien on the amounts on deposit in such funds and accounts.
Section 5.02. Installment Payment Fund. (a) The Trustee shall establish and maintain
the Installment Payment Fund until the required Installment Payment and the interest thereon, is
paid in full pursuant to the Installment Purchase Agreement and until the first date upon which
the Notes are no longer Outstanding. The Trustee shall deposit in the Installment Payment Fund
the Installment Payment, and the interest thereon, paid by the District and received by the
Trustee. The moneys in the Installment Payment Fund shall be held in trust by the Trustee for
the benefit of the Owners and shall be used and disbursed only for the purposes and uses herein
authorized.
(b) The Trustee shall transfer the amounts on deposit in the Installment Payment
Fund, at the times and in the manner hereinafter provided, to the following respective accounts
within the Installment Payment Fund, each of which the Trustee hereby agrees to establish and
maintain until the required Installment Payment, and the interest thereon, is paid in full pursuant
to the Installment Purchase Agreement and until the first date upon which the Notes are no
longer Outstanding. The moneys in each of such accounts shall be held in trust by the Trustee
for the benefit of the Owners and shall be used and disbursed only for the purposes and uses
herein authorized.
(i) Interest Account. The Trustee, on or before the Maturity Date, shall
deposit in the Interest Account that amount of moneys representing the interest on the
Installment Payment coming due on such date. Moneys in the Interest Account shall be
used by the Trustee for the purpose of paying the interest evidenced by the Notes when
due and payable.
(ii) Principal Account. The Trustee, on the Maturity Date, shall deposit in the
Principal Account that amount of moneys representing the Installment Payment coming
95713399.4 14
due on such date. Moneys in the Principal Account shall be used by the Trustee for the
purpose of paying the principal evidenced by the Notes when due and payable.
Section 5.03. Reserved.
Section 5.04. Reserved.
Section 5.05. Investment of Moneys. Except as otherwise provided herein, all moneys
in any of the funds or accounts established pursuant to this Trust Agreement shall be invested by
the Trustee solely in Permitted Investments, as directed by the District pursuant to a Written
Request of the District at least two (2) Business Days prior to the making of such investment.
Moneys in all funds and accounts held by the Trustee shall be invested in Permitted Investments
maturing not later than the date on which it is estimated that such moneys will be required for the
purposes specified in this Trust Agreement. Absent timely written direction from the District,
the Trustee shall invest any funds held by it in Permitted Investments described in clause (10) of
the definition thereof. Permitted Investments that are registerable securities shall be registered in
the name of the Trustee. All interest, profits and other income received from the investment of
moneys in any fund or account established pursuant to this Trust Agreement shall be retained
therein.
Permitted Investments acquired as an investment of moneys in any fund or account
established under this Trust Agreement shall be credited to such fund or account. For the
purpose of determining the amount in any fund, all Permitted Investments credited to such fund
shall be valued by the Trustee at the market value thereof.
The Trustee or an affiliate may act as principal or agent in the making or disposing of any
investment. The Trustee shall sell or present for redemption any Permitted Investment whenever
it shall be necessary to provide moneys to meet any required payment, transfer, withdrawal or
disbursement from the fund or account to which such Permitted Investment is credited, and the
Trustee shall not be liable or responsible for any loss resulting from any investment made or sold
pursuant to this Section. For purposes of investment, the Trustee may commingle moneys in any
of the funds and accounts established hereunder.
The Trustee is hereby authorized, in making or disposing of any investment permitted by
this Section, to deal with itself (in its individual capacity) or with any one or more of its
affiliates, whether or not such affiliate is acting as an agent of the Trustee or for any third Person
or dealing as principal for its own account.
Section 5.06. Brokerage Confirmations. The Trustee shall furnish the District periodic
cash transaction statements which include detail for all investment transactions effected by the
Trustee or brokers selected by the District. Upon the District's election, such statements will be
delivered via the Trustee's online service and upon electing such service, paper statements will
be provided only upon request. The District waives the right to receive brokerage confirmations
of security transactions effected by the Trustee as they occur, to the extent permitted by law. The
District further understands that trade confirmations for securities transactions effected by the
Trustee will be available upon request and at no additional cost and other trade confirmations
may be obtained from the applicable broker.
95713399.4 15
ARTICLE VI
COVENANTS
Section 6.01. Compliance with Trust Agreement. The Trustee will not execute or
deliver any Notes in any manner other than in accordance with the provisions hereof, and the
Corporation and the District will not suffer or permit any default by them to occur hereunder, but
will faithfully comply with, keep, observe and perform all the agreements, conditions, covenants
and terms hereof required to be complied with, kept, observed and performed by them.
Section 6.02. Compliance with Installment Purchase Agreement. The Corporation
and the District will faithfully comply with, keep, observe and perform all the agreements,
conditions, covenants and terms contained in the Installment Purchase Agreement required to be
complied with, kept, observed and performed by them and, together with the Trustee, will
enforce the Installment Purchase Agreement against the other party thereto in accordance with its
terms.
Section 6.03. Compliance with Master Agreement. The Corporation and the District
will faithfully comply with, keep, observe and perform all the agreements, conditions, covenants
and terms contained in the Master Agreement required to be complied with, kept, observed and
performed by them and, together with the Trustee, will enforce the Master Agreement against the
other party thereto in accordance with its terms.
Section 6.04. Observance of Laws and Regulations. The Corporation and the District
will faithfully comply with, keep, observe and perform all valid and lawful obligations or
regulations now or hereafter imposed on them by contract, or prescribed by any law of the
United States of America or of the State, or by any officer, board or commission having
jurisdiction or control, as a condition of the continued enjoyment of each and every franchise,
right or privilege now owned or hereafter acquired by them, including their right to exist and
carry on their respective businesses, to the end that such franchises, rights and privileges shall be
maintained and preserved and shall not become abandoned, forfeited or in any manner impaired.
Section 6.05. Other Liens. None of the Trustee, the Corporation or the District shall
create or suffer to be created any pledge of or lien on the amounts on deposit in any of the funds
or accounts created hereunder, other than the pledge and lien hereof.
Section 6.06. Prosecution and Defense of Suits. The District will defend against every
action, suit or other proceeding at any time brought against the Trustee or any Owner upon any
claim arising out of the receipt, deposit or disbursement of any of the Installment Payment, or the
interest thereon, or involving the rights of the Trustee or any Owner hereunder; provided,
however, that the Trustee or any Owner at its or his election may appear in and defend any such
action, suit or other proceeding.
Section 6.07. Accounting Records and Statements. The Trustee will keep proper
accounting records in which complete and correct entries shall be made of all transactions made
by the Trustee relating to the receipt, deposit and disbursement of the Installment Payment, and
the interest thereon, and such accounting records shall be available for inspection by the
95713399.4 16
Corporation and the District at reasonable hours and under reasonable conditions. The Trustee
shall not be obligated to provide an accounting for any fund or account that (a)has a balance of
$0.00 and (b)has not had any activity since the last reporting date. The Trustee will, upon
written request, make copies of the foregoing available to any Owner (at the expense of such
Owner).
Section 6.08. Tax Covenants.
(a) Special Definitions. When used in this Section, the following terms shall have the
following meanings:
"Bond Counsel" means Fulbright& Jaworski L.L.P. or any other counsel of recognized
national standing in the field of law relating to municipal bonds, appointed and paid by the
District and reasonably satisfactory to and approved by the Trustee.
"Computation Date" has the meaning set forth in section 1.148-1(b) of the Tax
Regulations.
"Computation Period" means, initially, that period commencing on the date of the
execution and delivery of the Notes and concluding on the initial Computation Date and,
thereafter, each period commencing on the day next following a Computation Date and
concluding on the immediately succeeding Computation Date.
"Gross Proceeds" of any issue of governmental obligations means any proceeds as
defined in section 1.148-1(b) of the Tax Regulations (referring to sales, investment and
transferred proceeds) of that issue, and any replacement proceeds as defined in
section 1.148-1(c) of the Tax Regulations, of that issue.
"Investment"has the meaning set forth in section 1.148-1(b) of the Tax Regulations.
"Nonpurpose Investment"means any investment property, as defined in section 148(b) of
the Code, in which Gross Proceeds of an issue are invested and that is not acquired to carry out
the governmental purposes of that issue.
"Opinion of Bond Counsel" means a written opinion of Fulbright& Jaworski L.L.P. or
any other counsel of recognized national standing in the field of law relating to municipal bonds,
appointed and paid by the District and reasonably satisfactory to and approved by the Trustee.
"Prior Issue" shall refer to the Prior Notes (but in the case of any of the foregoing
executed and delivered for multiple purposes, only to the portion thereof allocable pursuant to
section 1.148-9(h)(4) of the Tax Regulations to other than refunding purposes).
"Proceeds," with respect to an issue of governmental obligations, has the meaning set
forth in has the meaning set forth in section 1.148-1(b) of the Tax Regulations (referring to sales,
investment and transferred proceeds, but not replacement proceeds).
"Tax Regulations" means the United States Treasury Regulations promulgated pursuant
to sections 103 and 141 through 150 of the Code.
95713399.4 17
"Yield" of (i) any Investment has the meaning set forth in section 1.148-5 of the Tax
Regulations and (ii) in respect of the Notes has the meaning set forth in section 1.148-4 of the
Tax Regulations.
(b) Exclusion of Interest from Gross Income. The District will take all actions
necessary to establish and maintain the exclusion pursuant to section 103(a) of the Code of
interest on the Notes from the gross income of the owners thereof for federal income tax
purposes, and will not use, permit the use of, or omit to use Gross Proceeds of the Notes or any
other amounts (or any property the acquisition, construction or improvement of which is to be
refinanced directly or indirectly with Gross Proceeds) in a manner that if made or omitted,
respectively, would cause the interest on any Note to fail to be excluded pursuant to section
103(a) of the Code from the gross income of the owners thereof for federal income tax purposes.
Without limiting the generality of the foregoing, unless and until the Trustee receives a written
Opinion of Bond Counsel to the effect that failure to comply with such covenant will not
adversely affect the exclusion pursuant to section 103(a) of the Code of interest on any Note
from the gross income of the owner thereof, the District shall comply with this covenant and
each of the specific covenants in this Section.
(c) No Private Use or Private Payments. Except as would not cause any Note to
become a "private activity bond" within the meaning of section 141 of the Code and the Tax
Regulations and rulings thereunder, the District shall at all times prior to the payment and
cancellation of the last of the Notes to be retired:
(i) exclusively own, operate and possess all property the acquisition,
construction or improvement of which is to be financed or refinanced directly or
indirectly with Gross Proceeds of the Notes and not use or permit the use of such Gross
Proceeds (including all contractual arrangements with terms different than those
applicable to the general public) or any property acquired, constructed or improved with
such Gross Proceeds or the Gross Proceeds of any Prior Issue in any activity carried on
by any person or entity (including the United States or any agency, department and
instrumentality thereof) other than a state or local government, unless such use is solely
as a member of the general public; and
(ii) does not directly or indirectly impose or accept any charge or other
payment by any person or entity who is treated as using Gross Proceeds of the Notes or
of any Prior Issue, or any property the acquisition, construction or improvement of which
is to be financed or refinanced directly or indirectly with such Gross Proceeds, other than
taxes of general application within the jurisdiction of the District or interest earned on
investments acquired with such Gross Proceeds pending application for their intended
purposes.
(d) No Private Loan. Except as would not cause any Note to become a "private
activity bond" within the meaning of section 141 of the Code and the Tax Regulations and
rulings thereunder, the District shall not use of Gross Proceeds of the Notes to make or finance
loans to any person or entity other than a state or local government. For purposes of the
foregoing covenant, such Gross Proceeds are considered to be "loaned" to a person or entity if:
(i)property acquired, constructed or improved with such Gross Proceeds is sold or leased to such
95713399.4 18
person or entity in a transaction that creates a debt for federal income tax purposes; (ii) capacity
in or service from such property is committed to such person or entity under a take-or-pay,
output or similar contract or arrangement; or (iii) indirect benefits of such Gross Proceeds, or
burdens and benefits of ownership of any property acquired, constructed or improved with such
Gross Proceeds, are otherwise transferred in a transaction that is the economic equivalent of a
loan. For purposes of this covenant, the District will treat any transaction constituting a loan of
Gross Proceeds of any of the Prior Issues as resulting in a loan of Gross Proceeds of the Notes.
(e) Not to Invest at Higher Yield. Except as would not cause any Note to become an
"arbitrage bond" within the meaning of section 148 of the Code and the Tax Regulations and
rulings thereunder, the District will not, at any time prior to the final cancellation of the last Note
to be retired, directly or indirectly invest Gross Proceeds of the Notes in any Investment, if as a
result of that investment the yield of any Investment acquired with Gross Proceeds of the Notes,
whether then held or previously disposed of, would materially exceed the yield of the Notes
within the meaning of said section 148.
(f) Not Federally Guaranteed. Except to the extent such action or failure to act
would not, pursuant to section 149(b) of the Code and the Tax Regulations and rulings
thereunder, adversely affect the exclusion pursuant to section 103(a) of interest on the Notes
from the gross income of the owners thereof for federal income tax purposes, the District will not
take or omit to take any action that would cause any Note to be "federally guaranteed"within the
meaning of section 149(b) of the Code and the Tax Regulations and rulings thereunder.
(g) Information Report. The District will timely file any information necessary to the
exclusion pursuant to section 103(a) of the Code of interest on the Notes required by section
149(e) of the Code with the Secretary of the Treasury on Form 8038-G or such other form and in
such place as the Secretary of the Treasury may prescribe.
(h) Not to Divert Arbitrage Profits. Except to the extent permitted by section 148 of
the Code and the Tax Regulations and rulings thereunder, the District will not at any time prior
to the final cancellation of the last of the Notes to be retired, enter into any transaction that
reduces the amount required to be paid to the United States pursuant to section 148(f) of the
Code because such transaction results in a smaller profit or a larger loss than would have resulted
if the transaction had been at arm's length and had the yield on the Notes not been relevant to
either party.
(i) Notes Satisfy Section 149(g). The District represents that none of the Prior Issue
or the Notes are or will become"hedge bonds"within the meaning of section 149(g) of the Code.
Without limitation of the foregoing, with respect to the Prior Issue, (i)(A) on the date of issuance
of that issue the District reasonably expected (based upon its own knowledge and upon
representations made by other governmental persons upon the issuance of those obligations) that
within the three-year period commencing on such date no less than 85% of the spendable
proceeds of that issue would be expended for the governmental purposes thereof and (B) the
District believes and represents that at no time has more than 50% of the proceeds of that issue
been invested in Nonpurpose Investments having a substantially guaranteed yield for a period of
four years or more, and with respect to the application of Proceeds of the Notes other than for
refunding purposes, (ii)(A) the District will not deliver the Notes unless on the date of the
95713399.4 19
issuance of the Notes it reasonably expects that within the three-year period commencing on
such date of issuance at least 85% of such spendable proceeds of the Notes will be expended for
the governmental purpose of the Notes and (B) at no time will more than 50% of such spendable
proceeds of the Notes be invested in Nonpurpose Investments having a substantially guaranteed
yield for a period of four years or more.
0) Elections. The District hereby directs and authorizes any Authorized
Representative to make elections permitted or required pursuant to the provisions of the Code or
the Tax Regulations, as such Authorized Representative (after consultation with Bond Counsel)
deems necessary or appropriate in connection with the Notes, in the Tax Certificate relating to
the Notes or similar or other appropriate certificate, form or document.
(k) Tax Certificate. The District agrees to execute and deliver in connection with the
execution and delivery of the Notes a Tax Certificate as to Arbitrage and the Provisions of
Sections 141-150 of the Internal Revenue Code of 1986, or similar document containing
additional representations and covenants pertaining to the exclusion of interest with respect to
the Notes from the gross income of the owners thereof for federal income tax purposes (the "Tax
Certificate"), which representations and covenants are incorporated as though expressly set forth
herein.
Section 6.09. Continuing Disclosure. The District will comply with and carry out all of
the provisions of the Continuing Disclosure Agreement applicable to it. Notwithstanding any
other provision of this Trust Agreement, failure of the District to comply with the Continuing
Disclosure Agreement shall not be considered an Event of Default; provided, however, the
Trustee, at the request of any Participating Underwriter or the Owners of at least 25% aggregate
principal amount of Outstanding Notes and upon being indemnified to its reasonable satisfaction,
shall, or any Owner or Beneficial Owner of Notes may take such actions as may be necessary
and appropriate to compel performance, including seeking mandate or specific performance by
court order.
Section 6.10. Further Assurances. The District will promptly execute and deliver or
cause to be executed and delivered all such other and further assurances, documents or
instruments and promptly do or cause to be done all such other and further things as may be
necessary or reasonably required in order to carry out the purposes and intentions of this Trust
Agreement and for preserving and protecting the rights and interests of the Owners.
ARTICLE VII
DEFAULT AND LIMITATIONS OF LIABILITY
Section 7.01. Action upon Event of Default. An Event of Default under the Installment
Purchase Agreement shall constitute an Event of Default hereunder and an Event of Default
under the Master Agreement shall constitute an Event of Default hereunder. The Trustee may
give notice, as assignee of the Corporation, of an Event of Default under the Installment
Purchase Agreement to the District, and shall do so if directed to do so by the Owners of not less
than 5% of the aggregate principal evidenced by Notes then Outstanding. In each and every case
during the continuance of an Event of Default, the Trustee may and, at the direction of the
95713399.4 20
Owners of not less than a majority of the aggregate principal evidenced by Notes then
Outstanding, shall, upon notice in writing to the District and the Corporation (a) exercise any of
the remedies granted to the Corporation under the Installment Purchase Agreement, (b) exercise
any of the remedies granted to the Trustee under the Master Agreement, and (c) take whatever
action at law or in equity may appear necessary or desirable to enforce its rights pursuant to this
Trust Agreement, the Installment Purchase Agreement or the Master Agreement or to protect and
enforce any of the rights vested in the Trustee or the Owners by this Trust Agreement, the Notes,
the Installment Purchase Agreement or the Master Agreement, either at law or in equity or in
bankruptcy or otherwise, whether for the specific enforcement of any covenant or agreement or
for the enforcement of any other legal or equitable right, including any one or more of the
remedies set forth in Section 7.02 hereof.
Section 7.02. Other Remedies of the Trustee. Subject to the provisions of Section 7.01
hereof, the Trustee shall have the right:
(a) by mandamus or other action or proceeding or suit at law or in equity to enforce
its rights against the Corporation or the District or any member, director, officer or employee
thereof, and to compel the Corporation or the District or any such member, director, officer or
employee to perform or carry out its or his or her duties under law and the agreements and
covenants required to be performed by it or him or her contained herein;
(b) by suit in equity to enjoin any acts or things which are unlawful or violate the
rights of the Trustee; or
(c) by suit in equity upon the happening of any Event of Default hereunder to require
the Corporation and the District to account as the trustee of an express trust.
Section 7.03. Non-Waiver. A waiver of any default or breach of duty or contract by the
Trustee or the Owners shall not affect any subsequent default or breach of duty or contract or
impair any rights or remedies on any such subsequent default or breach of duty or contract. No
delay or omission by the Trustee or the Owners to exercise any right or remedy accruing upon
any default or breach of duty or contract shall impair any such right or remedy or shall be
construed to be a waiver of any such default or breach of duty or contract or an acquiescence
therein, and every right or remedy conferred upon the Trustee or the Owners by law or by this
Article may be enforced and exercised from time to time and as often as the Trustee shall deem
expedient.
If any action, proceeding or suit to enforce any right or to exercise any remedy is
abandoned or determined adversely to the Trustee or any Owner, then subject to any adverse
determination, the Trustee, such Owner, the Corporation and the District shall be restored to their
former positions, rights and remedies as if such action, proceeding or suit had not been brought
or taken.
Section 7.04. Remedies Not Exclusive. Subject to the provisions of Section 7.01
hereof, no remedy herein conferred upon or reserved to the Trustee is intended to be exclusive of
any other remedy, and each such remedy shall be cumulative and shall be in addition to every
other remedy given hereunder or now or hereafter existing in law or in equity or by statute or
95713399.4 21
otherwise and may be exercised without exhausting and without regard to any other remedy
conferred by any law. The assertion or employment of any right or remedy hereunder, or
otherwise, shall not prevent the concurrent or subsequent assertion or employment of any other
appropriate right or remedy.
Section 7.05. Application of Amounts After Default. All damages or other payments
received by the Trustee for the enforcement of any rights and powers of the Trustee under this
Article shall be deposited into the Installment Payment Fund and as soon as practicable thereafter
applied:
(a) to the payment of all amounts due the Trustee under Section 8.03 hereof,
(b) unless the unpaid Installment Payment, and the interest thereon, shall have
become, and shall remain, immediately due and payable pursuant to the Master Agreement:
(i) to the payment of all amounts then due for interest evidenced by the
Notes, in respect of which, or for the benefit of which, money has been collected (other
than Notes which have become payable prior to such Event of Default and money for the
payment of which is held by the Trustee), ratably without preference or priority of any
kind, according to the amounts of interest evidenced by such Notes due and payable; and
(ii) to the payment of all amounts then due for principal evidenced by the
Notes, in respect of which, or for the benefit of which, money has been collected (other
than Notes which have become payable prior to such Event of Default and money for the
payment of which is held by the Trustee), ratably without preference or priority of any
kind, according to the amounts of principal evidenced by such Notes due and payable.
(c) if the unpaid Installment Payment, and the interest thereon, shall have become,
and shall remain, immediately due and payable pursuant to the Master Agreement, to the
payment of all amounts then due for principal and interest evidenced by the Notes and, if the
amount available therefor shall not be sufficient to pay in full the whole amount so due and
unpaid, then to the payment thereof ratably, without preference or priority of principal over
interest, or of interest over principal, or of any installment of interest over any other installment
of interest, or of any Note over any other Note, to the persons entitled thereto without any
discrimination or preference.
Section 7.06. Trustee May Enforce Claims Without Possession of Notes. All rights
of action and claims under this Trust Agreement or the Notes may be prosecuted and enforced by
the Trustee without the possession of any of the Notes or the production thereof in any
proceeding relating thereto, and any such proceeding instituted by the Trustee shall be brought in
its own name as trustee of an express trust, and any recovery of judgment shall, after provision
for the payment of the reasonable compensation, expenses, disbursements and advances of the
Trustee, its agents and counsel, be for the ratable benefit of the Owners of the Notes in respect of
which such judgment has been recovered.
Section 7.07. Limitation on Suits. No Owner shall have any right to institute any
proceeding,judicial or otherwise, with respect to this Trust Agreement, or for the appointment of
a receiver or trustee, or for any other remedy hereunder, unless (a) such Owner shall have
95713399.4 22
previously given written notice to the Trustee of a continuing Event of Default hereunder, (b)the
Owners of not less than a majority of the aggregate principal evidenced by Notes then
Outstanding shall have made written request to the Trustee to institute proceedings in respect of
such Event of Default in its own name as Trustee hereunder, (c) such Owner or Owners shall
have afforded to the Trustee indemnity reasonably satisfactory to the Trustee against the costs,
expenses and liabilities to be incurred in compliance with such request, (d) the Trustee for 60
days after its receipt of such notice, request and offer of indemnity shall have failed to institute
any such proceedings, and (e)no direction inconsistent with such written request shall have been
given to the Trustee during such 60-day period by the Owners of a majority of the aggregate
principal evidenced by Notes then Outstanding; it being understood and intended that no one or
more Owners of Notes shall have any right in any manner whatever by virtue of, or by availing
of, any provision of this Trust Agreement to affect, disturb or prejudice the rights of any other
Owner of Notes, or to obtain or seek to obtain priority or preference over any other Owner or to
enforce any right under this Trust Agreement, except in the manner herein provided and for the
equal and ratable benefit of all the Owners of Notes.
Section 7.08. No Liability by the Corporation to the Owner. Except as expressly
provided herein, the Corporation shall not have any obligation or liability to the Owners with
respect to the payment when due of the Installment Payment, and the interest thereon, by the
District, or with respect to the performance by the District of the other agreements and covenants
required to be performed by it contained in the Installment Purchase Agreement, the Master
Agreement or herein, or with respect to the performance by the Trustee of any right or obligation
required to be performed by it contained herein.
Section 7.09. No Liability by the District to the Owners. Except for the payment
when due of the Installment Payment, and the interest thereon, and the performance of the other
agreements and covenants required to be performed by it contained in the Installment Purchase
Agreement, the Master Agreement or herein, the District shall not have any obligation or liability
to the Owners with respect to this Trust Agreement or the preparation, execution, delivery or
transfer of the Notes or the disbursement of the Installment Payment, and the interest thereon, by
the Trustee to the Owners, or with respect to the performance by the Trustee of any right or
obligation required to be performed by it contained herein.
Section 7.10. No Liability of the Trustee to the Owners. Except as expressly provided
herein, the Trustee shall not have any obligation or liability to the Owners with respect to the
payment when due of the Installment Payment, and the interest thereon, by the District, or with
respect to the performance by the Corporation or the District of the other agreements and
covenants required to be performed by them, respectively, contained in the Installment Purchase
Agreement or herein.
ARTICLE VIII
THE TRUSTEE
Section 8.01. Employment of the Trustee, Duties. The Corporation and the District
hereby appoint and employ the Trustee to receive, deposit and disburse the Installment Payment,
and the interest thereon, to prepare, execute, deliver and transfer the Notes and to perform the
95713399.4 23
other functions contained herein, all in the manner provided herein and subject to the conditions
and terms hereof By executing and delivering this Trust Agreement, the Trustee accepts the
appointment and employment hereinabove referred to and accepts the rights and obligations of
the Trustee provided herein, subject to the conditions and terms hereof. Other than when an
Event of Default hereunder has occurred and is continuing, the Trustee undertakes to perform
such duties and only such duties as are specifically set forth in this Trust Agreement, and no
implied covenants or obligations shall be read into this Trust Agreement against the Trustee. In
case an Event of Default has occurred and is continuing, the Trustee shall exercise such of the
rights and powers vested in it by this Trust Agreement, and use the same degree of care and skill
in their exercise, as a prudent person would exercise or use under the circumstances in the
conduct of such person's own affairs.
Section 8.02. Removal and Resignation of the Trustee. The Corporation and the
District may, by an instrument in writing, remove the Trustee initially a party hereto and any
successor thereto unless an Event of Default shall have occurred and then be continuing, and
shall remove the Trustee initially a party hereto and any successor thereto if at any time
(a)requested to do so by an instrument or concurrent instruments in writing signed by the
Owners of a majority of the aggregate principal evidenced by the Notes at the time Outstanding
(or their attorneys duly authorized in writing), or (b) the Trustee shall cease to be eligible in
accordance with the following paragraph, and shall appoint a successor Trustee. The Trustee
shall be a bank having trust powers or a trust company in good standing in or incorporated under
the laws of the United States or any state thereof, having (or if such bank or trust company is a
member of a bank holding company system, its parent bank holding company shall have) a
combined capital and surplus of at least $75,000,000, and be subject to supervision or
examination by federal or state banking authorities. If such bank or trust company publishes a
report of condition at least annually, pursuant to law or to the requirements of any supervising or
examining authority above referred to, then for the purposes of this Section the combined capital
and surplus of such bank or trust company shall be deemed to be its combined capital and
surplus as set forth in its most recent report of condition so published.
The Trustee may at any time resign by giving written notice of such resignation to the
Corporation and the District and by giving notice, by first class mail, postage prepaid, of such
resignation to the Owners at their addresses appearing on the registration books maintained by
the Trustee. Upon receiving such notice of resignation, the Corporation and the District shall
promptly appoint a successor Trustee by an instrument in writing; provided, however, that in the
event the District and the Corporation do not appoint a successor Trustee within 30 days
following receipt of such notice of resignation, the resigning Trustee may, at the expense of the
District, petition the appropriate court having jurisdiction to appoint a successor Trustee. Any
resignation or removal of a Trustee and appointment of a successor Trustee shall become
effective only upon acceptance of appointment by the successor Trustee. Any successor Trustee
appointed under this Trust Agreement shall signify its acceptance of such appointment by
executing and delivering to the District and the Corporation and to its predecessor Trustee a
written acceptance thereof, and thereupon such successor Trustee, without any further act, deed
or conveyance, shall become vested with all the moneys, estates, properties, rights, powers,
trusts, duties and obligations of such predecessor Trustee, with like effect as if originally named
Trustee herein; but, nevertheless, at the written request of the District or of the successor Trustee,
such predecessor Trustee shall execute and deliver any and all instruments of conveyance or
95713399.4 24
further assurance and do such other things as may reasonably be required for more fully and
certainly vesting in and confirming to such successor Trustee all the right, title and interest of
such predecessor Trustee in and to any property held by it under this Trust Agreement and shall
pay over, transfer, assign and deliver to the successor Trustee any money or other property
subject to the trusts and conditions herein set forth.
Any corporation, association or agency into which the Trustee may be converted or
merged, or with which it may be consolidated, or to which it may sell or transfer its corporate
trust business and assets as a whole or substantially as a whole, or any corporation or association
resulting from any such conversion, sale, merger, consolidation or transfer to which it is a party,
provided that such entity meets the combined capital and surplus requirements of this Section,
ipso facto, shall be and become successor trustee under this Trust Agreement and vested with all
the trusts, powers, discretions, immunities, privileges and all other matters as was its
predecessor, without the execution or filing of any instrument or any further act, deed or
conveyance on the part of any of the parties hereto, anything herein to the contrary
notwithstanding.
Section 8.03. Compensation and Indemnification of the Trustee. The District shall
from time to time, subject to any written agreement then in effect with the Trustee, pay the
Trustee reasonable compensation for all its services rendered hereunder and reimburse the
Trustee for all its reasonable advances and expenditures (which shall not include "overhead
expenses" except as such expenses are included as a component of the Trustee's stated annual
fees or disclosed transaction fees) hereunder, including but not limited to advances to and
reasonable fees and reasonable expenses of accountants, agents, appraisers, consultants or other
experts, and counsel not directly employed by the Trustee but an attorney or firm of attorneys
retained by the Trustee, employed by it in the exercise and performance of its rights and
obligations hereunder; provided, however, that the Trustee shall not have any lien for such
compensation or reimbursement against any moneys held by it in any of the funds or accounts
established hereunder. The Trustee may take whatever legal actions are lawfully available to it
directly against the Corporation or the District.
Except as otherwise expressly provided herein, no provision of this Trust Agreement
shall require the Trustee to expend or risk its own funds or otherwise incur any financial liability
in the performance of any of its duties hereunder or in the exercise of any of its rights or powers
hereunder.
The District, to the extent permitted by law, agrees to indemnify and save the Trustee, its
directors, officers, employees and agents harmless against any liabilities which it may incur in
the exercise and performance of its powers and duties hereunder, including but not limited to
costs and expenses incurred in defending against any claim or liability, which are not due to its
negligence or willful misconduct.
Section 8.04. Protection of the Trustee. The Trustee shall be protected and shall incur
no liability in acting or proceeding in good faith upon any affidavit, bond, certificate, consent,
notice, request, requisition, resolution, statement, waiver or other paper or document which it
shall in good faith believe to be genuine and to have been adopted, executed or delivered by the
proper party or pursuant to any of the provisions hereof, and the Trustee shall be under no duty
95713399.4 25
to make any investigation or inquiry as to any statements contained or matters referred to in any
such instrument, but may accept and rely upon the same as conclusive evidence of the truth and
accuracy of such statements. The Trustee shall be under no obligation to exercise any of the
rights or powers vested in it by this Trust Agreement at the request or direction of any of the
Owners of the Notes pursuant to this Trust Agreement, unless such Owners shall have offered to
the Trustee security or indemnity, reasonably satisfactory to the Trustee, against the reasonable
costs, expenses and liabilities which might be incurred by it in compliance with such request or
direction. The Trustee may consult with counsel, who may be counsel to the Corporation or the
District, with regard to legal questions, and the opinion of such counsel shall be full and
complete authorization and protection in respect to any action taken or suffered by it hereunder
in good faith in accordance therewith.
The Trustee shall not be responsible for the sufficiency of the Notes or the Installment
Purchase Agreement, or of the assignment made to it hereunder, or for statements made in the
preliminary or final official statement relating to the Notes.
The Trustee shall not be required to take notice or be deemed to have notice of any
default or Event of Default hereunder, except failure of any of the payments to be made to the
Trustee required to be made hereunder or under the Installment Purchase Agreement, unless the
Trustee shall be specifically notified in writing of such default or Event of Default by the
District, the Corporation or the Owners of not less than 5% of the aggregate principal evidenced
by the Notes then Outstanding.
Whenever in the administration of its rights and obligations hereunder the Trustee shall
deem it necessary or desirable that a matter be proved or established prior to taking or suffering
any action hereunder, such matter (unless other evidence in respect thereof be herein specifically
prescribed) may be deemed to be conclusively proved and established by a Written Certificate of
the District or a Written Certificate of the Corporation, and such certificate shall be full warrant
to the Trustee for any action taken or suffered under the provisions hereof upon the faith thereof,
but in its discretion the Trustee may, in lieu thereof, accept other evidence of such matter or may
require such additional evidence as it deems reasonable.
The Trustee may buy, sell, own, hold and deal in any of the Notes and may join in any
action which any Owner may be entitled to take with like effect as if the Trustee were not a party
hereto. The Trustee, either as principal or agent, may also engage in or be interested in any
financial or other transaction with the Corporation or the District, and may act as agent,
depository or trustee for any committee or body of Owners or of owners of obligations of the
Corporation or the District as freely as if it were not the Trustee hereunder.
The Trustee may, to the extent reasonably necessary, execute any of the trusts or powers
hereof and perform any rights and obligations required of it hereunder by or through agents,
attorneys or receivers, and shall be entitled to advice of counsel concerning all matters of trust
and its rights and obligations hereunder, and the Trustee shall not be answerable for the
negligence or misconduct of any such agent, attorney or receiver selected by it with reasonable
care; provided, however, that in the event of any negligence or misconduct of any such attorney,
agent or receiver, the Trustee shall diligently pursue all remedies of the Trustee against such
agent, attorney or receiver. The Trustee shall not be liable for any error of judgment made by it
95713399.4 26
in good faith unless it shall be proved that the Trustee was negligent in ascertaining the pertinent
facts.
The Trustee shall not be answerable for the exercise of any trusts or powers hereunder or
for anything whatsoever in connection with the funds established hereunder, except only for its
own willful misconduct, negligence or breach of an obligation hereunder.
The Trustee may, on behalf of the Owners, intervene in any judicial proceeding to which
the Corporation or the District is a party and which, in the opinion of the Trustee and its counsel,
affects the Notes or the security therefor, and shall do so if requested in writing by the Owners of
at least 5% of the aggregate principal evidenced by Notes then Outstanding, provided the Trustee
shall have no duty to take such action unless it has been indemnified to its reasonable satisfaction
against all risk or liability arising from such action.
ARTICLE IX
AMENDMENT OF OR SUPPLEMENT TO TRUST AGREEMENT
Section 9.01. Amendment or Supplement. (a) This Trust Agreement and the rights
and obligations of the Corporation, the District, the Owners and the Trustee hereunder may be
amended or supplemented at any time by an amendment hereof or supplement hereto which shall
become binding when the prior written consents of the Owners of a majority of the aggregate
principal evidenced by the Notes then Outstanding, exclusive of Notes disqualified as provided
in Section 9.02 hereof, are filed with the Trustee. No such amendment or supplement shall
(i) extend the stated Maturity Date of any Note or reduce the rate of interest evidenced thereby or
extend the time of payment of such interest or reduce the amount of principal evidenced thereby,
(ii)reduce the percentage of Owners whose consent is required for the execution of any
amendment hereof or supplement hereto without the prior written consent of the Owners of all
Notes then Outstanding, (iii)modify any of the rights or obligations of the Trustee without the
prior written consent of the Trustee, or (iv) amend this Section without the prior written consent
of the Owners of all Notes then Outstanding.
(b) This Trust Agreement and the rights and obligations of the Corporation, the
District, the Owners and the Trustee hereunder may also be amended or supplemented at any
time by an amendment hereof or supplement hereto which shall become binding upon execution,
without the written consents of any Owners, but only to the extent permitted by law and only for
any one or more of the following purposes:
(i) to add to the agreements, conditions, covenants and terms required by the
Corporation or the District to be observed or performed herein other agreements,
conditions, covenants and terms thereafter to be observed or performed by the
Corporation or the District, or to surrender any right or power reserved herein to or
conferred herein on the Corporation or the District;
(ii) to make such provisions for the purpose of curing any ambiguity or of
correcting, curing or supplementing any defective provision contained herein or in regard
95713399.4 27
to questions arising hereunder which the Corporation or the District may deem desirable
or necessary and not inconsistent herewith;
(iii) to make such additions, deletions or modifications as may be necessary or
appropriate to assure the exclusion from gross income for federal income tax purposes of
interest evidenced by the Notes; or
(iv) for any other reason, provided such amendment or supplement does not
adversely affect the rights or interests of the Owners.
Section 9.02. Disqualified Notes. Notes owned or held by or for the account of the
District (but excluding Notes held in any pension or retirement fund of the District) shall not be
deemed Outstanding for the purpose of any consent or other action or any calculation of
Outstanding Notes provided in this Article, and shall not be entitled to consent to or take any
other action provided in this Article, and the Trustee may adopt appropriate regulations to
require each Owner, before his consent provided for herein shall be deemed effective, to reveal if
the Notes as to which such consent is given are disqualified as provided in this Section.
Section 9.03. Endorsement or Replacement of Notes After Amendment or
Supplement. After the effective date of any action taken as hereinabove provided in this
Article, the Trustee may determine that the Notes may bear a notation by endorsement in form
approved by the Trustee as to such action, and in that case upon demand of the Owner of any
Outstanding Note and presentation of such Note for such purpose at the Principal Office a
suitable notation as to such action shall be made on such Note. If the Trustee shall receive an
Opinion of Counsel advising that new Notes modified to conform to such action are necessary,
modified Notes shall be prepared, and in that case upon demand of the Owner of any
Outstanding Notes such new Notes shall be exchanged at the Principal Office without cost to
each Owner for Notes then Outstanding upon surrender of such Outstanding Notes.
Section 9.04. Amendment by Mutual Consent. The provisions of this Article shall not
prevent any Owner from accepting any amendment as to the particular Notes owned by such
Owner, provided that due notation thereof is made on such Notes.
ARTICLE X
DEFEASANCE
Section 10.01. Discharge of Notes and Trust Agreement. (a) If the Trustee shall pay
or cause to be paid or there shall otherwise be paid (i) to the Owners of all Outstanding Notes the
interest and principal evidenced thereby at the times and in the manner stipulated herein and
therein, and (ii) all other amounts due hereunder and under the Installment Purchase Agreement,
then such Owners shall cease to be entitled to the pledge of and lien on the amounts on deposit in
the funds and accounts established hereunder, as provided herein, and all agreements and
covenants of the Corporation, the District, and the Trustee to such Owners hereunder shall
thereupon cease, terminate and become void and shall be discharged and satisfied.
(b) Any Outstanding Note shall be deemed to have been paid within the meaning and
with the effect expressed in this Section when the whole amount of the principal and interest
95713399.4 28
evidenced by such Note shall have been paid or when there shall be on deposit with the Trustee,
moneys, or Government Obligations, or any combination thereof, the principal of and the interest
on which when due, and without any reinvestment thereof, will provide moneys which shall be
sufficient to pay when due the principal and interest evidenced by such Note and due and to
become due on or prior to the Maturity Date, and if the Maturity Date will not occur, and said
Note is not to be prepaid, within the next succeeding 60 days, the District shall have given the
Trustee irrevocable instructions to give notice, as soon as practicable to the Owner of such Note,
stating that the deposit of moneys or Government Obligations required by this subsection has
been made with the Trustee and that such Note, or portion thereof, is deemed to have been paid
in accordance with this Section and stating such Maturity Date upon which moneys are to be
available for the payment of the principal and interest evidenced by said Note, or portion thereof.
Neither the moneys nor the Government Obligations deposited with the Trustee pursuant
to this Section nor principal or interest payments on any such Government Obligations shall be
withdrawn or used for any purpose other than, and shall be held in trust for and pledged to, the
payment of the principal and interest evidenced by said Note, or portions thereof. If payment of
less than all of the Notes is to be provided for in the manner and with the effect expressed in this
Section, the Trustee or the District, as applicable, shall select such Notes, or portions thereof in
the principal amounts designated to the Trustee by the District.
(c) After the payment of all the interest and principal evidenced by all Outstanding
Notes and all other amounts due hereunder and under the Installment Purchase Agreement as
provided in this Section, the Trustee shall execute and deliver to the Corporation and the District
all such instruments as may be necessary or desirable to evidence the discharge and satisfaction
of this Trust Agreement, the Trustee shall pay over or deliver to the District all moneys or
securities held by it pursuant hereto which are not required for the payment of the interest and
principal evidenced by such Notes and all other amounts due hereunder and under the
Installment Purchase Agreement.
(d) Prior to any defeasance becoming effective under this Article, the District shall
cause to be delivered (i) an executed copy of a report, addressed to the Trustee and the District,
in form and in substance acceptable to the Trustee and the District, of a nationally recognized
certified public accountant, or firm of such accountants, verifying that the Government
Obligations and cash, if any, satisfy the requirements of subsection(b) of this Section (a
"Verification"), (ii) a copy of the escrow deposit agreement entered into in connection with such
defeasance, which escrow deposit agreement shall provide that no substitution of Government
Obligations shall be permitted except with other Government Obligations and upon delivery of a
new Verification and no reinvestment of Government Obligations shall be permitted except as
contemplated by the original Verification or upon delivery of a new Verification, and (iii) a copy
of an Opinion of Counsel, dated the date of such defeasance and addressed to the Trustee and the
District, in form and in substance acceptable to the District, to the effect that such Notes have
been paid within the meaning and with the effect expressed in this Trust Agreement, and all
agreements and covenants of the Corporation, the District and the Trustee to the Owners of such
Notes under this Trust Agreement have ceased, terminated and become void and have been
discharged and satisfied.
95713399.4 29
Section 10.02. Unclaimed Moneys. Any moneys held by the Trustee in trust for the
payment and discharge of the interest or principal evidenced by any of the Notes which remain
unclaimed for two years after the date when such interest or principal evidenced by such Notes
have become payable, if such moneys were held by the Trustee at such date, or for two years
after the date of deposit of such moneys if deposited with the Trustee after the date when the
interest and principal evidenced by such Notes have become payable, shall be repaid by the
Trustee to the District as its absolute property free from trust, and the Trustee shall thereupon be
released and discharged with respect thereto and the Owners shall look only to the District for
the payment of the interest and principal evidenced by such Notes.
ARTICLE XI
MISCELLANEOUS
Section 11.01. Benefits of Trust Agreement. Nothing contained herein, expressed or
implied, is intended to give to any Person other than the Corporation, the District, the Trustee
and the Owners any claim, remedy or right under or pursuant hereto, and any agreement,
condition, covenant or term required herein to be observed or performed by or on behalf of the
Corporation or the District shall be for the sole and exclusive benefit of the Trustee and the
Owners.
Section 11.02. Successor Deemed Included in all References to Predecessor.
Whenever the Corporation, the District or the Trustee, or any officer thereof, is named or
referred to herein, such reference shall be deemed to include the successor to the powers, duties
and functions that are presently vested in the Corporation, the District or the Trustee, or such
officer, and all agreements, conditions, covenants and terms required hereby to be observed or
performed by or on behalf of the Corporation, the District or the Trustee, or any officer thereof,
shall bind and inure to the benefit of the respective successors thereof whether so expressed or
not.
Section 11.03. Execution of Documents by Owners. Any declaration, request or other
instrument which is permitted or required herein to be executed by Owners may be in one or
more instruments of similar tenor and may be executed by Owners in person or by their attorneys
appointed in writing. The fact and date of the execution by any Owner or his attorney of any
declaration, request or other instrument or of any writing appointing such attorney may be
proved by the certificate of any notary public or other officer authorized to take
acknowledgments of deeds to be recorded in the state or territory in which he purports to act that
the Person signing such declaration, request or other instrument or writing acknowledged to him
the execution thereof, or by an affidavit of a witness of such execution duly sworn to before such
notary public or other officer, or by such other proof as the Trustee may accept which it may
deem sufficient.
The ownership of any Notes and the amount, payment date, number and date of owning
the same may be proved by the registration books maintained by the Trustee pursuant to the
provisions of Section 2.07 hereof.
95713399.4 30
Any declaration, request or other instrument in writing of the Owner of any Note shall
bind all future Owners of such Note with respect to anything done or suffered to be done by the
Corporation, the District or the Trustee in good faith and in accordance therewith.
Section 11.04. Waiver of Personal Liability. Notwithstanding anything contained
herein to the contrary, no member, officer or employee of the District or the Corporation shall be
individually or personally liable for the payment of any moneys, including without limitation, the
interest or principal evidenced by the Notes, but nothing contained herein shall relieve any
member, officer or employee of the District or the Corporation from the performance of any
official duty provided by any applicable provisions of law, by the Installment Purchase
Agreement or hereby.
Section 11.05. Reserved.
Section 11.06. Content of Written Certificates. Every Written Certificate of the
District and every Written Certificate of the Corporation with respect to compliance with any
agreement, condition, covenant or term contained herein shall include (a) a statement that the
Person making or giving such certificate has read such agreement, condition, covenant or term
and the definitions herein relating thereto, (b) a brief statement as to the nature and scope of the
examination or investigation upon which the statements contained in such certificate are based,
(c) a statement that, in the opinion of the signer, the signer has made or caused to be made such
examination or investigation as is necessary to enable the signer to express an informed opinion
as to whether or not such agreement, condition, covenant or term has been complied with, and
(d) a statement as to whether, in the opinion of the signer, such agreement, condition, covenant
or term has been complied with.
Any Written Certificate of the District and any Written Certificate of the Corporation
may be based, insofar as it relates to legal matters, upon an Opinion of Counsel, unless the
Person making or giving such certificate knows that the Opinion of Counsel with respect to the
matters upon which each Person's certificate may be based, as aforesaid, is erroneous, or in the
exercise of reasonable care should have known that the same was erroneous. Any Opinion of
Counsel may be based, insofar as it relates to factual matters, upon information which is in the
possession of the District or the Corporation upon a representation by an officer or officers of the
District or the Corporation, as the case may be, unless the counsel executing such Opinion of
Counsel knows that the representation with respect to the matters upon which such counsel's
opinion may be based, as aforesaid, is erroneous, or in the exercise of reasonable care should
have known that the same was erroneous.
Section 11.07. Funds and Accounts. Any fund or account required to be established
and maintained herein by the Trustee may be established and maintained in the accounting
records of the Trustee either as an account or a fund, and may, for the purposes of such
accounting records, any audits thereof and any reports or statements with respect thereto, be
treated either as an account or a fund, but all such records with respect to all such funds and
accounts shall at all times be maintained in accordance with sound accounting practice and with
due regard for the protection of the security of the Notes and the rights of the Owners. The
Trustee may establish such funds and accounts as it deems necessary to perform its obligations
hereunder.
95713399.4 31
Trustee may commingle any of the moneys held by it hereunder for investment purposes
only; provided, however, that the Trustee shall account separately for the moneys in each fund or
account established pursuant to this Trust Agreement.
Section 11.08. Article and Section Headings, Gender and References. The singular
form of any word used herein, including the terms defined in Section 1.01 hereof, shall include
the plural, and vice versa, unless the context otherwise requires. The use herein of a pronoun of
any gender shall include correlative words of the other genders. The headings or titles of the
several Articles and Sections hereof and the table of contents appended hereto shall be solely for
convenience of reference and shall not affect the meaning, construction or effect hereof. All
references herein to "Articles," "Sections," subsections or clauses are to the corresponding
Articles, Sections, subsections or clauses hereof, and the words "hereby," "herein," "hereof,"
"hereto," "herewith," "hereunder" and other words of similar import refer to this Trust
Agreement as a whole and not to any particular Article, Section, subsection or clause thereof.
Section 11.09. Partial Invalidity. If any one or more of the agreements, conditions,
covenants or terms required herein to be observed or performed by or on the part of the
Corporation, the District or the Trustee shall be contrary to law, then such agreement or
agreements, such condition or conditions, such covenant or covenants or such term or terms shall
be null and void to the extent contrary to law and shall be deemed separable from the remaining
agreements, conditions, covenants and terms hereof and shall in no way affect the validity hereof
or of the Notes, and the Owners shall retain all the benefit, protection and security afforded to
them under any applicable provisions of law. The Corporation, the District and the Trustee
hereby declare that they would have executed this Trust Agreement, and each and every Article,
Section, paragraph, subsection, sentence, clause and phrase hereof and would have authorized
the execution and delivery of the Notes pursuant hereto irrespective of the fact that any one or
more Articles, Sections, paragraphs, subsections, sentences, clauses or phrases hereof or the
application thereof to any Person or circumstance may be held to be unconstitutional,
unenforceable or invalid.
Section 11.10. California Law. This Trust Agreement shall be governed by and
construed in accordance with the laws of the State.
Section 11.11. Notices. Any written notice, statement, demand, consent, approval,
authorization, offer, designation, request or other communication to be given hereunder shall be
given to the party entitled thereto at its address set forth below, or at such other address as such
party may provide to the other parties in writing from time to time, namely:
If to the District: Orange County Sanitation District
10844 Ellis Avenue
Fountain Valley, California 92708
Attention: Director of Finance and Administrative Services
95713399.4 32
If to the Corporation: Orange County Sanitation District Financing Corporation
c/o Orange County Sanitation District
10844 Ellis Avenue
Fountain Valley, California 92708
Attention: Treasurer
If to the Trustee: Union Bank,N.A.
120 South San Pedro Street, Suite 400
Los Angeles, California 90012
Attention: Alison Braunstein
Telephone: (213) 972-5674
Facsimile: (213) 972-5694
Each such notice, statement, demand, consent, approval, authorization, offer, designation,
request or other communication hereunder shall be deemed delivered to the party to whom it is
addressed (a) if personally served or delivered, upon delivery, (b) if given by electronic
communication, e.g. facsimile or telecopier, upon the sender's receipt of an appropriate written
acknowledgment, (c) if given by registered or certified mail, return receipt requested, deposited
with the United States mail postage prepaid, 72 hours after such notice is deposited with the
United States mail, (d) if given by overnight courier, with courier charges prepaid, 24 hours after
delivery to said overnight courier, or (e) if given by any other means, upon delivery at the
address specified in this Section.
Section 11.12. Effective Date. This Trust Agreement shall become effective upon its
execution and delivery.
Section 11.13. Execution in Counterparts. This Trust Agreement may be
simultaneously executed in several counterparts, each of which shall be deemed an original, and
all of which shall constitute but one and the same instrument.
95713399.4 33
IN WITNESS WHEREOF, the parties hereto have caused this Trust Agreement to be
executed by their respective officers thereunto duly authorized, all as of the day and year first
written above.
ORANGE COUNTY SANITATION DISTRICT
FINANCING CORPORATION
By:
Treasurer
ORANGE COUNTY SANITATION DISTRICT
By:
Chair of the Board of Directors
(S E A L)
Attest:
By:
Clerk of the Board of Directors
UNION BANK,N.A.,
as Trustee
By:
Authorized Officer
95713399.4 34
EXHIBIT A
FORM OF NOTE
No. R-1 [PAR]
Unless this Note is presented by an authorized representative of The Depository Trust
Company to the Trustee for registration of transfer, exchange or payment, and any Note executed
and delivered is registered in the name of Cede & Co. or such other name as requested by an
authorized representative of The Depository Trust Company and any payment is made to Cede &
Co., ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE
BY OR TO ANY PERSON IS WRONGFUL inasmuch as the Registered Owner hereof, Cede &
Co., has an interest herein.
ORANGE COUNTY SANITATION DISTRICT
REVENUE REFUNDING CERTIFICATES OF PARTICIPATION, SERIES 2012C
(CERTIFICATE ANTICIPATION NOTE)
DATED DATE INTEREST RATE MATURITY DATE CUSIP
% , 2013
REGISTERED OWNER: CEDE & CO.
PRINCIPAL AMOUNT:
THIS IS TO CERTIFY that the Registered Owner of this Orange County Sanitation
District Revenue Refunding Certificate of Participation, Series 2012C (Certificate Anticipation
Note) (this "Note"), as identified above, is the owner of a direct, fractional undivided interest in
certain installment payments ("Installment Payment"), and the interest thereon, payable under
and pursuant to the Installment Purchase Agreement, dated as of October 1, 2012 (the
"Installment Purchase Agreement"), by and between the Orange County Sanitation District (the
"District"), a county sanitation district organized and existing under the laws of the State of
California, and the Orange County Sanitation District Financing Corporation (the
"Corporation"), a nonprofit public benefit corporation organized and existing under the laws of
the State of California. Certain of the rights of the Corporation under the Installment Purchase
Agreement, including the right to receive the Installment Payment, and the interest thereon, have
been assigned without recourse by the Corporation to Union Bank, N.A., a national banking
association duly organized and existing under the laws of the United States of America, as
trustee (the "Trustee") under the Trust Agreement, dated as of October 1, 2012 (the "Trust
Agreement"), by and among the Trustee, the District and the Corporation. Capitalized undefined
terms used herein shall have the meanings ascribed thereto in the Trust Agreement.
The District has executed and delivered the Master Agreement for District Obligations,
dated as of August 1, 2000 (the "Master Agreement"), by and between the District and the
95713399.4 A-1
Corporation, pursuant to which the District establishes and declares the conditions and terms
upon which obligations such as the Installment Purchase Agreement, and the Installment
Payment and the interest thereon, will be incurred and secured.
This Note is one of the duly authorized Orange County Sanitation District Revenue
Refunding Certificate Anticipation Notes, Series 2012C (the "Notes") evidencing principal in the
aggregate amount of [PAR], executed and delivered pursuant to the terms of the Trust
Agreement. The Notes evidence direct, fractional undivided interests in the Installment
Payment, and the interest thereon, payable under the Installment Purchase Agreement. The
Notes are executed and delivered to refinance certain improvements to the wastewater collection,
treatment and disposal facilities of the District (the "Wastewater System") and to pay the costs of
issuance incurred in connection therewith.
The Installment Payment, and the interest thereon, are to be paid by the District pursuant
to the Installment Purchase Agreement in consideration for the purchase of certain improvements
to the Wastewater System and for the other agreements and obligations undertaken by the
Corporation under the Installment Purchase Agreement and the Trust Agreement.
The Notes evidence direct, fractional undivided interests in the Installment Payment, and
the interest thereon, paid by the District pursuant to the Installment Purchase Agreement. The
obligation of the District to pay the Installment Payment and the interest thereon and other
payments required to be made by it under the Installment Purchase Agreement is a special
obligation of the District payable, in the manner provided under the Installment Purchase
Agreement, from Net Revenues, and other lawfully available funds of the District, as provided in
the Installment Purchase Agreement. Net Revenues generally consist of all income and revenue
received by the District from the operation or ownership of the Wastewater System remaining
after payment of Maintenance and Operation Costs, all as further provided in the Master
Agreement.
The Installment Purchase Agreement constitutes a Senior Obligation and, as such, shall
be subject to the provisions of the Master Agreement, and shall be afforded all of the advantages,
benefits, interests and security afforded Senior Obligations pursuant to the Master Agreement.
The Installment Purchase Agreement is payable on a parity with the other existing Senior
Obligation. The District may at any time incur Senior Obligations in addition to existing Senior
Obligations and the Installment Purchase Agreement payable from Net Revenues as provided in
the Master Agreement on a parity with all other Senior Obligations theretofore incurred, but only
subject to the conditions and upon compliance with the procedures set forth in the Master
Agreement.
The obligation of the District to pay the Installment Payment and the interest thereon, and
other payments required to be made by it under the Installment Purchase Agreement is a special
obligation of the District payable, in the manner provided in the Installment Purchase
Agreement, from Net Revenues and other lawfully available funds of the District, as provided in
the Installment Purchase Agreement, and does not constitute a debt of the District or of the State,
or of any political subdivision thereof, in contravention of any constitutional or statutory debt
limitation or restriction. Neither the faith and credit nor the taxing power of the District or the
State or any political subdivision thereof, is pledged to the payment of the Installment Payment,
95713399.4 A-2
or the interest thereon, or other payments required to be made under the Installment Purchase
Agreement. The Installment Purchase Agreement constitutes a Senior Obligation and, as such, is
subject to the provisions of the Master Agreement and is afforded all of the advantages, benefits,
interests and security afforded Senior Obligations pursuant to the Master Agreement.
Reference is hereby made to the Master Agreement, the Installment Purchase Agreement
and to the Trust Agreement and any and all amendments thereof and supplements thereto for a
description of the terms under which the District's obligation to pay the Installment Payment,
and the interest thereon, is incurred, the Notes are executed and delivered, the provisions with
regard to the nature and extent of the Net Revenues and other lawfully available funds of the
District, and the rights of the Owners of the Notes. All of the terms of the Master Agreement,
the Installment Purchase Agreement and the Trust Agreement are hereby incorporated herein.
The Trust Agreement constitutes a contract among the District, the Corporation and the Trustee
for the benefit of the Owners of the Notes, to all the provisions of which the Owner of this Note,
by acceptance hereof, agrees and consents.
The Registered Owner of this Note is entitled to receive, subject to the terms of the Trust
Agreement on the Maturity Date set forth above, upon presentation and surrender of this Note at
the principal corporate trust office of the Trustee in Los Angeles, California (the "Principal
Office"), the Principal Amount specified above, evidencing the Owner's interest in the
Installment Payment coming due on the Maturity Date, and to receive on the Maturity Date,
interest accrued thereon at the Interest Rate specified above, computed on the basis of a 360-day
year consisting of twelve 30-day months, until such Principal Amount is paid in full, evidencing
the Registered Owner's interest in the interest evidenced by the Installment Payment coming due
on such date.
Payments of interest evidenced by the Notes shall be made to the Owners thereof (as
determined at the close of business on the Record Date next preceding the Maturity Date or any
other date fixed for payment) by check or draft of the Trustee mailed to the address of each such
Owner as it appears on the registration books maintained by the Trustee pursuant to the Trust
Agreement, or to such other address as may be furnished in writing to the Trustee by such
Owner. Payment of principal evidenced by the Notes, on the Maturity Date, shall be made only
upon presentation and surrender of the Notes at the Principal Office. All such amounts are
payable in lawful money of the United States of America.
The Notes are authorized to be executed and delivered in the form of fully registered
notes in denominations of$5,000 or any integral multiple thereof.
This Note may be transferred or exchanged by the Registered Owner hereof, in person or
by his attorney duly authorized in writing, at the Principal Office, but only in the manner, subject
to the limitations and upon payment of the charges provided in the Trust Agreement.
The Trustee may treat the Registered Owner hereof as the absolute owner hereof for all
purposes, whether or not the principal or interest evidenced by this Note shall be overdue, and
the Trustee shall not be affected by any knowledge or notice to the contrary; and payment of the
principal and interest evidenced by this Note shall be made only to such Registered Owner,
95713399.4 A-3
which payments shall be valid and effectual to satisfy and discharge the liability evidenced by
this Note to the extent of the sum or sums so paid.
The Notes are not subject to prepayment prior to the Maturity Date.
To the extent and in the manner permitted by the terms of the Trust Agreement, the Trust
Agreement and the rights and obligations of the Corporation, the District, the Owners and the
Trustee under the Trust Agreement may be amended or supplemented at any time by an
amendment or supplement thereto which shall become binding when the prior written consents
of the Owners of a majority of the aggregate principal evidenced by the Notes then outstanding,
exclusive of Notes disqualified as provided under the Trust Agreement, are filed with the
Trustee. No such supplement or amendment shall (a) extend the stated Maturity Date or reduce
the rate of interest evidenced thereby or extend the time of payment of such interest or reduce the
amount of principal evidenced thereby, (b)reduce the percentage of Owners whose consent is
required for the execution of any amendment of or supplement to the Trust Agreement without
the prior written consent of the Owners of all Notes then outstanding, (c) modify any of the
rights or obligations of the Trustee without the prior written consent of the Trustee or (d) amend
the amendment provisions of the Trust Agreement without the prior written consent of the
Owners of all Notes then outstanding.
To the extent and in the manner permitted by the terms of the Trust Agreement, the Trust
Agreement and the rights and obligations of the Corporation, the District, the Owners and the
Trustee under the Trust Agreement may also be amended or supplemented at any time by an
amendment or supplement thereto which shall become binding upon execution, without the
written consents of any Owners,but only to the extent permitted by law and only(a) to add to the
agreements, conditions, covenants and terms required by the Corporation or the District to be
observed or performed under the Trust Agreement other agreements, conditions, covenants and
terms thereafter to be observed or performed by the Corporation or the District, or to surrender
any right or power reserved therein to or conferred therein on the Corporation or the District, and
which in either case shall not adversely affect the rights or interests of the Owners, (b)to make
such provisions for the purpose of curing any ambiguity or of correcting, curing or
supplementing any defective provision contained in the Trust Agreement or in regard to
questions arising thereunder which the Corporation or the District may deem desirable or
necessary and not inconsistent therewith, (c) to make such additions, deletions or modifications
as may be necessary or appropriate to assure the exclusion from gross income for federal income
tax purposes of interest evidenced by the Notes or (d) for any other reason, provided such
amendment or supplement does not adversely affect the rights or interests of the Owners.
THE DISTRICT HAS CERTIFIED that all acts, conditions and things required by the
statutes of the State of California and by the Trust Agreement to exist, to have happened and to
have been performed precedent to and in connection with the execution and delivery of this Note
do exist, have happened and have been performed in regular and due time, form and manner as
required by law, and that the Trustee is duly authorized to execute and deliver this Note.
95713399.4 A-4
IN WITNESS WHEREOF, this Note has been executed by the manual signature of an
authorized signatory of the Trustee as of the date set forth below.
Date: , 2012
UNION BANK,N.A.,
as Trustee
By:
Authorized Officer
95713399.4 A-5
ASSIGNMENT
For value received, the undersigned do(es) hereby sell, assign and transfer unto
the within-mentioned Note and hereby
irrevocably constitute(s) and
appoint(s) attorney, to transfer the same
on the books of the Trustee with full power of substitution in the premises.
Dated:
Note: The signature(s) on this Assignment must correspond with the name(s) as written on the
face of the within registered Note in every particular, without alteration or enlargement
or any change whatsoever.
Tax I.D. #:
Signature Guaranteed:
Note: Signature(s)must be guaranteed by an eligible Note: The signature(s)on this Assignment must correspond
guarantor. with the name(s)as written on the face of the within Note in
every particular without alteration or enlargement or any
change whatsoever.
95713399.4 A-6
Fulbright & Jaworski L.L.P.— Draft 08/24/12
INSTALLMENT PURCHASE AGREEMENT
by and between
ORANGE COUNTY SANITATION DISTRICT
and
ORANGE COUNTY SANITATION DISTRICT
FINANCING CORPORATION
Dated as of October 1, 2012
Relating to
[PAR]
Orange County Sanitation District
Revenue Refunding Certificate Anticipation Notes, Series 2012C
95713504.2
TABLE OF CONTENTS
Page
ARTICLE I DEFINITIONS................................................................................................. 2
Section 1.01. Definitions............................................................................................ 2
Section 1.02. Definitions in Master Agreement and Trust Agreement...................... 3
ARTICLE II PURCHASE OF PROJECT BY, AND SALE THEREOF TO, THE
CORPORATION; PAYMENT........................................................................4
Section 2.01. Acquisition of the Project....................................................................4
Section 2.02. Payment of Purchase Price...................................................................4
ARTICLE III PURCHASE OF PROJECT BY, AND SALE THEREOF TO, THE
DISTRICT; INSTALLMENT PAYMENTS...................................................4
Section 3.01. Purchase and Sale of Project................................................................4
Section 3.02. Installment Payment............................................................................. 4
Section3.03. Reserved............................................................................................... 4
Section 3.04. Obligation Absolute............................................................................. 5
Section 3.05. Nature of Agreement............................................................................ 5
ARTICLE IV NO PREPAYMENT OF INSTALLMENT PAYMENTS;
DISCHARGE................................................................................................... 5
Section 4.01. No Prepayment of Installment Payment.............................................. 5
Section 4.02. Discharge of Obligations ..................................................................... 5
ARTICLE V COVENANTS ................................................................................................. 5
Section 5.01. Compliance with Master Agreement................................................... 5
Section 5.02. Compliance with Installment Purchase Agreement............................. 5
Section 5.03. Protection of Security and Rights........................................................ 6
Section 5.04. Indemnification of Corporation........................................................... 6
Section 5.05. Further Assurances............................................................................... 6
ARTICLE VI EVENTS OF DEFAULT AND REMEDIES OF THE
CORPORATION............................................................................................. 6
Section 6.01. Events of Default................................................................................. 6
Section 6.02. Remedies on Default............................................................................ 7
Section6.03. Non-Waiver.......................................................................................... 7
Section 6.04. Remedies Not Exclusive...................................................................... 8
ARTICLE VII AMENDMENTS ............................................................................................. 8
Section 7.01. Amendments........................................................................................ 8
95713504.2 _�_
TABLE OF CONTENTS
(continued)
Page
ARTICLE VIII MISCELLANEOUS ........................................................................................ 9
Section 8.01. Liability of District Limited................................................................. 9
Section 8.02. Limitation of Rights............................................................................. 9
Section8.03. Assignment .......................................................................................... 9
Section8.04. Notices ............................................................................................... 10
Section 8.05. Successor Is Deemed Included in all References to Predecessor...... 10
Section 8.06. Waiver of Personal Liability.............................................................. 10
Section 8.07. Article and Section Headings, Gender and References ..................... 11
Section 8.08. Partial Invalidity................................................................................. 11
Section 8.09. Governing Law.................................................................................. 11
Section 8.10. Execution in Counterparts.................................................................. 11
EXHIBIT A - DESCRIPTION OF PROJECT..........................................................................A-I
95713504.2 -11-
INSTALLMENT PURCHASE AGREEMENT
THIS INSTALLMENT PURCHASE AGREEMENT (this "Installment Purchase
Agreement"), dated as of October 1, 2012, is by and between the ORANGE COUNTY
SANITATION DISTRICT, a county sanitation district organized and existing under the laws of
the State of California (the "District"), and the ORANGE COUNTY SANITATION DISTRICT
FINANCING CORPORATION, a nonprofit public benefit corporation organized and existing
under the laws of the State of California(the "Corporation").
WITNESSETH:
WHEREAS, to finance the acquisition, construction and installation of certain
improvements to its wastewater system (the "Prior Project") the District caused the execution
and delivery of $143,205,000 in aggregate principal amount of Orange County Sanitation
District Revenue Refunding Certificates Anticipation Notes, Series 2011B, of which
$143,205,000 in principal amount is currently outstanding (the "Prior Notes");
WHEREAS, the District desires to pay all of the Prior Notes by paying at maturity all of
the principal component of the installment payment relating to the Prior Notes (the "Prior
Installment Payment"), and the interest thereon;
WHEREAS, to provide the funds necessary to pay the Prior Installment Payment and the
interest thereon to be so paid, the District and the Corporation desire that the Corporation
purchase the Prior Project from the District and the District sell the Prior Project to the
Corporation, and that the District then purchase the Prior Project from the Corporation and the
Corporation sell the Prior Project to the District, for the installment payment (the "Installment
Payment") to be made by the District, pursuant to a new installment purchase agreement (the
"Installment Purchase Agreement"),and the Corporation and the District have agreed to finance
such prepayment by causing the execution and delivery of[PAR] in aggregate principal amount
of Orange County Sanitation District Revenue Refunding Certificate Anticipation Notes, Series
2012C (the "Notes") evidencing direct, fractional undivided interests in the Installment Payment
and the interest thereon, to be made by the District pursuant to the Installment Purchase
Agreement;
WHEREAS, pursuant to the Master Agreement for District Obligations, dated as of
August 1, 2000, by and between the District and the Corporation, the District has established and
declared the conditions and terms upon which obligations such as this Installment Purchase
Agreement, and the Installment Payment, and the interest thereon, are to be incurred and
secured;
WHEREAS, the Corporation proposes to assign without recourse certain of its rights
under and pursuant to this Installment Purchase Agreement to Union Bank, N.A., as trustee (the
"Trustee");
95713504.2
WHEREAS, in consideration of such assignment and the execution and delivery of the
Trust Agreement, dated as of the date hereof, by and among the Trustee, the Corporation and the
District, the Trustee has agreed to execute and deliver the Notes, evidencing direct, undivided
fractional interests in the Installment Payment, and the interest thereon, payable hereunder;
WHEREAS, a portion of the proceeds of the Notes, together with other available funds,
will be used to prepay the Prior Installment Payment; and
WHEREAS, all acts, conditions and things required by law to exist, to have happened
and to have been performed precedent to and in connection with the execution and delivery of
this Installment Purchase Agreement do exist, have happened and have been performed in
regular and due time, form and manner as required by law, and the parties hereto are now duly
authorized to execute and enter into this Installment Purchase Agreement;
NOW, THEREFORE, in consideration of the covenants and provisions herein set forth
and for other good and valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties hereto do hereby agree as follows:
ARTICLE I
DEFINITIONS
Section 1.01. Definitions. Except as provided in Section 1.02 hereof or unless the
context otherwise requires, the terms defined in this Section shall for all purposes hereof and of
any amendment hereof or supplement hereto and of any report or other document mentioned
herein or therein have the meanings defined herein, the following definitions to be equally
applicable to both the singular and plural forms of any of the terms defined herein:
"Business Day" means a day other than (a) Saturday or Sunday, (b) a day on which
banking institutions in the city in which the Principal Office is located are authorized or required
by law to be closed, and (c) a day on which the New York Stock Exchange is authorized or
obligated by law or executive order to be closed.
"Closing Date" means October 30, 2012.
"Corporation" means the Orange County Sanitation District Financing Corporation, a
nonprofit public benefit corporation organized and existing under the laws of the State, and any
successor thereto.
"District" means the Orange County Sanitation District, a county sanitation district
organized and existing under and by virtue of the laws of the State, and any successor thereto.
"Event of Default" means an event described in Section 6.01 hereof.
"Installment Payment" means the Installment Payment required to be made by the
District pursuant to Section 3.02 hereof.
"Installment Payment Date" means October 30, 2013.
95713504.2 2
"Installment Purchase Agreement" means this Installment Purchase Agreement, dated
as of October 1, 2012, by and between the District and the Corporation, as originally executed
and as it may from time to time be amended or supplemented in accordance with the terms
hereof.
"Master Agreement" means the Master Agreement for District Obligations, dated as of
August 1, 2000, by and between the District and the Corporation, as originally executed and as it
may from time to time be amended or supplemented in accordance with the terms thereof.
"Notes" means the Orange County Sanitation District Revenue Refunding Certificates of
Participation (Certificate Anticipation Notes), Series 2012C, also known as the Orange County
Sanitation District Revenue Refunding Certificate Anticipation Notes, Series 2012C, executed
and delivered by the Trustee pursuant to the Trust Agreement.
"Person" means an individual, corporation, limited liability company, firm, association,
partnership, trust, or other legal entity or group of entities, including a governmental entity or
any agency or political subdivision thereof.
"Principal Office" means the Trustee's principal corporate trust office in Los Angeles,
California.
"Project" means the improvements to the Wastewater System, as described in Exhibit A
hereto.
"Trust Agreement" means the Trust Agreement, dated as of October 1, 2012, by and
among the Trustee, the Corporation and the District, as originally executed and as it may from
time to time be amended or supplemented in accordance with its terms.
"Trustee" means Union Bank, N.A., a national banking association duly organized and
existing under the laws of the United States of America, or any other bank or trust company
which may at any time be substituted in its place as provided in the Trust Agreement.
Section 1.02. Definitions in Master Agreement and Trust Agreement. Except as
otherwise herein defined and unless the context otherwise requires, the terms defined in the
Master Agreement or the Trust Agreement shall for all purposes hereof and of any amendment
hereof or supplement hereto and of any report or other document mentioned herein have the
meanings defined therein, such definitions to be equally applicable to both the singular and
plural forms of any of the terms defined therein. With respect to any defined term which is given
a different meaning under this Installment Purchase Agreement than under the Master
Agreement or the Trust Agreement, as used herein it shall have the meaning given herein.
95713504.2 3
ARTICLE 11
PURCHASE OF PROJECT BY,AND SALE THEREOF TO,
THE CORPORATION; PAYMENT
Section 2.01. Acquisition of the Proiect. The District represents and warrants that it is
the sole and exclusive owner of the Project. The Corporation hereby purchases from the District,
and the District hereby sells to the Corporation, the Project in accordance with the provisions of
this Installment Purchase Agreement. All right, title and interest in and to the Project shall
immediately vest in the Corporation on the Closing Date without further action on the part of the
Corporation or the District.
Section 2.02. Payment of Purchase Price. On the Closing Date, the Corporation shall
pay to the District, as the purchase price of the Project, the amount of $ , which
amount shall be paid from the net proceeds of the Notes.
ARTICLE III
PURCHASE OF PROJECT BY,AND SALE THEREOF TO, THE DISTRICT;
INSTALLMENT PAYMENTS
Section 3.01. Purchase and Sale of Proiect. The District hereby purchases from the
Corporation, and the Corporation hereby sells to the District, the Project in accordance with the
provisions of this Installment Purchase Agreement. All right, title and interest in and to the
Project shall immediately vest in the District on the Closing Date without further action on the
part of the District or the Corporation.
Section 3.02. Installment Payment. The District shall pay to the Corporation, from
Net Revenues and other lawfully available funds of the District, the purchase price of the Project
in a single Installment Payment, with interest thereon, as provided herein. The Installment
Payment shall be in the aggregate principal amount of [PAR], and shall be payable on the
Installment Payment Date.
The Installment Payment shall accrue interest from the Closing Date, at the rate of %
per annum, payable on the Installment Payment Date. Such interest shall accrue on the basis of
a 360-day year consisting of twelve 30-day months. The Installment Payment, and the payment
of interest thereon, shall be deposited with the Trustee, as assignee of the Corporation, no later
than the Installment Payment Date, in lawful money of the United States of America, in
immediately available funds. If and to the extent that, on any such date, there are amounts on
deposit in the Installment Payment Fund established under the Trust Agreement, or in any of the
accounts therein, which amounts are not being held for the payment of specific Notes, such
amounts shall be credited against the Installment Payment, or payment of interest thereon, as
applicable, due on such date.
Section 3.03. Reserved.
95713504.2 4
Section 3.04. Obligation Absolute. The obligation of the District to make the
Installment Payment, and payment of interest thereon, and other payments required to be made
by it under this Article, from Net Revenues and other lawfully available funds of the District, is
absolute and unconditional, and until such time as the Installment Payment, payments of interest
thereon, and such other payments shall have been paid in full (or provision for the payment
thereof shall have been made pursuant to Article IV), the District shall not discontinue or
suspend any Installment Payment, or payments of interest thereon, or other payments required to
be made by it hereunder when due, whether or not the Project or any part thereof is operating or
operable or has been completed, or its use is suspended, interfered with, reduced or curtailed or
terminated in whole or in part, and such Installment Payment, payments of interest thereon, and
other payments shall not be subject to reduction whether by offset or otherwise and shall not be
conditional upon the performance or nonperformance by any party of any agreement for any
cause whatsoever.
Section 3.05. Nature of Agreement. This Installment Purchase Agreement constitutes
a Senior Obligation and, as such, shall be subject to the provisions of the Master Agreement and
shall be afforded all of the advantages, benefits, interests and security afforded Senior
Obligations pursuant to the Master Agreement.
ARTICLE IV
NO PREPAYMENT OF INSTALLMENT PAYMENTS; DISCHARGE
Section 4.01. No Prepayment of Installment Payment. The Installment Payment shall
not be subject to prepayment prior to the Installment Payment Date.
Section 4.02. Discharge of Obligations. If the Installment Payment, and the interest
thereon, shall be paid as and when due in accordance with the terms hereof, and if all Notes shall
be fully paid, or provision therefor made in accordance with Article X of the Trust Agreement,
and the Trust Agreement shall be discharged by its terms, then all agreements, covenants and
other obligations of the District hereunder shall thereupon cease, terminate and become void and
be discharged and satisfied.
ARTICLE V
COVENANTS
Section 5.01. Compliance with Master Agreement. The District will faithfully
observe and perform all the agreements, conditions, covenants and terms contained in the Master
Agreement required to be observed and performed by it and will not cause, suffer or permit any
default to occur thereunder.
Section 5.02. Compliance with Installment Purchase Agreement. The District will
punctually pay the Installment Payment, and interest thereon, and other payments required to be
made by it hereunder in strict conformity with the terms hereof, and will faithfully observe and
perform all the agreements, conditions, covenants and terms contained herein required to be
observed and performed by it, will not cause, suffer or permit any default to occur hereunder and
95713504.2 5
will not terminate this Installment Purchase Agreement for any cause including, without limiting
the generality of the foregoing, any acts or circumstances that may constitute failure of
consideration, destruction of or damage to the Project, commercial frustration of purpose, any
change in the tax or other laws of the United States of America or of the State or any political
subdivision of either or any failure of the Corporation to observe or perform any agreement,
condition, covenant or term contained herein required to be observed and performed by it,
whether express or implied, or any duty, liability or obligation arising out of or connected
herewith or the insolvency, or deemed insolvency, or bankruptcy or liquidation of the
Corporation or any force majeure, including acts of God, tempest, storm, earthquake, war,
rebellion, riot, civil disorder, acts of public enemies, blockade or embargo, strikes, industrial
disputes, lock outs, lack of transportation facilities, fire, explosion, or acts or regulations of
governmental authorities.
Section 5.03. Protection of Security and Rights. The District will preserve and protect
the security hereof and the rights of the Trustee, as assignee of the Corporation, to the
Installment Payment, and interest thereon, and other payments required to be made by the
District hereunder and will warrant and defend such rights against all claims and demands of all
Persons.
Section 5.04. Indemnification of Corporation. To the extent permitted by law, the
District hereby agrees to indemnify and hold the Corporation and its members and officers
harmless against any and all liabilities which might arise out of or are related to the Project, this
Installment Purchase Agreement or the Notes, and the District further agrees to defend the
Corporation and its members and officers in any action arising out of or related to the Project,
this Installment Purchase Agreement or the Notes.
Section 5.05. Further Assurances. The District will adopt, deliver, execute and make
any and all further assurances, instruments and resolutions as may be reasonably necessary or
proper to carry out the intention or to facilitate the performance hereof and for the better assuring
and confirming unto the Corporation, or unto the Trustee, as assignee of the Corporation, the
rights and benefits provided herein to the Corporation, or to the Trustee, as assignee of the
Corporation.
ARTICLE VI
EVENTS OF DEFAULT AND REMEDIES OF THE CORPORATION
Section 6.01. Events of Default. The following shall be Events of Default under this
Installment Purchase Agreement, and "Event of Default" shall mean any one or more of the
following events:
(a) if default shall be made by the District in the due and punctual payment of or on
account of any Senior Obligation as the same shall become due and payable;
(b) if default shall be made by the District in the performance of any of the
agreements or covenants required herein, in the Trust Agreement or in the Master Agreement to
be performed by it (other than as specified in (a) above), and such default shall have continued
95713504.2 6
for a period of 30 days after the District shall have been given notice in writing of such default
by the Corporation or the Trustee; provided, however, that the party or parties giving such notice
may agree in writing to a reasonable extension of such period prior to the expiration of such 30
day period and, provided further, that if the District shall proceed to take curative action which,
if begun and prosecuted with due diligence, cannot be completed within such a period of 30
days, then such period shall be increased without such written extension to such extent as shall
be necessary to enable the District to diligently complete such curative action and such default
shall not become an Event of Default for so long as shall be necessary to diligently complete
such curative action; or
(c) if the District shall file a petition or answer seeking arrangement or reorganization
under the federal bankruptcy laws or any other applicable law of the United States of America or
any state therein, or if a court of competent jurisdiction shall approve a petition filed with or
without the consent of the District seeking arrangement or reorganization under the federal
bankruptcy laws or any other applicable law of the United States of America or any state therein,
or if under the provisions of any other law for the relief or aid of debtors any court of competent
jurisdiction shall assume custody or control of the District or of the whole or any substantial part
of its property.
Section 6.02. Remedies on Default. Upon the occurrence of an Event of Default, the
Trustee, as assignee of the Corporation, shall have the right:
(a) by mandamus or other action or proceeding or suit at law or in equity to enforce
its rights against the District and to compel the District to perform and carry out its duties under
applicable law and the agreements and covenants required to be performed herein;
(b) by suit in equity to enjoin any acts or things which are unlawful or violate the
rights of the Trustee, as assignee of the Corporation;
(c) by suit in equity to require the District to account as the trustee of an express trust;
and to have a receiver or receivers appointed for the Wastewater System and of the issues,
earnings, income, products and profits thereof, pending such proceedings, with such powers as
the court making such appointment shall confer.
Section 6.03. Non-Waiver. Nothing in this Article or in any other provision hereof
shall affect or impair the obligation of the District, which is absolute and unconditional, to pay
the Installment Payment, and the interest thereon, to the Trustee, as assignee of the Corporation,
at the respective due dates from the Net Revenues and the other funds herein committed for such
payment, or shall affect or impair the right of the Trustee, as assignee of the Corporation, which
is also absolute and unconditional, to institute suit to enforce such payment by virtue of the
contract embodied herein.
A waiver of any default or breach of duty or contract by the Trustee, as assignee of the
Corporation, shall not affect any subsequent default or breach of duty or contract or impair any
rights or remedies on any such subsequent default or breach of duty or contract. No delay or
omission by the Trustee, as assignee of the Corporation, to exercise any right or remedy accruing
upon any default or breach of duty or contract shall impair any such right or remedy or shall be
95713504.2 7
construed to be a waiver of any such default or breach of duty or contract or an acquiescence
therein, and every right or remedy conferred upon the Trustee, as assignee of the Corporation, by
applicable law or by this Article may be enforced and exercised from time to time and as often as
shall be deemed expedient by the Trustee, as assignee of the Corporation.
If any action,proceeding or suit to enforce any right or exercise any remedy is abandoned
or determined adversely to the Trustee, as assignee of the Corporation, the District and the
Trustee, as assignee of the Corporation, shall be restored to their former positions, rights and
remedies as if such action, proceeding or suit had not been brought or taken.
Section 6.04. Remedies Not Exclusive. No remedy herein conferred upon or reserved
to the Trustee, as assignee of the Corporation, is intended to be exclusive of any other remedy,
and each such remedy shall be cumulative and shall be in addition to every other remedy given
hereunder or now or hereafter existing in law or in equity or by statute or otherwise and may be
exercised without exhausting and without regard to any other remedy conferred by law.
ARTICLE VII
AMENDMENTS
Section 7.01. Amendments. (a) This Installment Purchase Agreement and the rights
and obligations of the District, the Corporation and the Trustee, as assignee of the Corporation,
may be amended or modified from time to time and at any time by a written amendment hereto
executed by the District, the Corporation and the Trustee, as assignee of the Corporation, with
the written consent of the Owners of a majority of the aggregate principal evidenced by Notes
then Outstanding. No such amendment shall (i) extend the payment date of any Installment
Payment or reduce the amount of any Installment Payment, or the interest rate applicable thereto,
without the prior written consent of the Owner of each affected Note, or (ii) reduce the
percentage of Owners of the Notes whose consent is required to effect any such amendment or
modification, without the prior written consent of the Owners of all Notes then Outstanding.
(b) This Installment Purchase Agreement and the rights and obligations of the
District, the Corporation and the Trustee, as assignee of the Corporation, may be amended or
modified from time to time and at any time by a written amendment hereto executed by the
District, the Corporation and the Trustee, as assignee of the Corporation, without the written
consents of any Owners of the Notes, but only to the extent permitted by law and only for any
one or more of the following purposes:
(i) to add to the agreements, conditions, covenants and terms required by the
District, the Corporation or the Trustee, as assignee of the Corporation, to be observed
or performed herein other agreements, conditions, covenants and terms thereafter to be
observed or performed by the District, the Corporation or the Trustee, as assignee of the
Corporation, or to surrender any right or power reserved herein to or conferred herein
on the District, the Corporation or the Trustee, as assignee of the Corporation;
(ii) to make such provisions for the purpose of curing any ambiguity or of
correcting, curing or supplementing any defective provision contained herein or in
95713504.2 8
regard to questions arising hereunder which the District, the Corporation or the Trustee,
as assignee of the Corporation, may deem desirable or necessary and not inconsistent
herewith;
(iii) to make such additions, deletions or modifications as may be necessary or
appropriate to assure the exclusion from gross income for federal income tax purposes
of interest on the Installment Payment; and
(iv) to make such other changes herein or modifications hereto as the District,
the Corporation or the Trustee, as assignee of the Corporation, may deem desirable or
necessary, and which shall not materially adversely affect the interests of the Owners of
the Notes.
ARTICLE VIII
MISCELLANEOUS
Section 8.01. Liability of District Limited. Notwithstanding anything contained herein
to the contrary, the District shall not be required to advance any moneys derived from any source
of income other than Net Revenues and the other funds provided herein for the payment of the
Installment Payment, and the interest thereon, and other payments required to be made by it
hereunder, or for the performance of any agreements or covenants required to be performed by it
contained herein. The District may, however, but in no event shall be obligated to, advance
moneys for any such purpose so long as such moneys are derived from a source legally available
for such purpose and may be legally used by the District for such purpose.
The obligation of the District to pay the Installment Payment, and the interest thereon,
and other payments required to be made by it hereunder is a special obligation of the District
payable, in the manner provided herein, from Net Revenues and other funds provided for herein,
and does not constitute a debt of the District or of the State, or of any political subdivision
thereof, in contravention of any constitutional or statutory debt limitation or restriction. Neither
the faith and credit nor the taxing power of the District or the State, or any political subdivision
thereof, is pledged to the payment of the Installment Payment, or the interest thereon, or other
payments required to be made hereunder.
Section 8.02. Limitation of Rights. Nothing in this Installment Purchase Agreement
expressed or implied is intended or shall be construed to give to any Person other than the
District, the Corporation and the Trustee, as assignee of the Corporation, any legal or equitable
right, remedy or claim under or in respect of this Installment Purchase Agreement or any
covenant, condition or provision therein or herein contained, and all such covenants, conditions
and provisions are and shall be held to be for the sole and exclusive benefit of the District, the
Corporation and the Trustee, as assignee of the Corporation.
Section 8.03. Assignment. The District and the Corporation hereby acknowledge the
transfer, conveyance and assignment by the Corporation to the Trustee of all of the Corporation's
rights, title and interest in and to this Installment Purchase Agreement (excepting its rights to
95713504.2 9
indemnification hereunder), including the right to receive Installment Payment, and the interest
thereon, from the District,pursuant to the Trust Agreement.
Section 8.04. Notices. Any written notice, statement, demand, consent, approval,
authorization, offer, designation, request or other communication to be given hereunder shall be
given to the party entitled thereto at its address set forth below, or at such other address as such
party may provide to the other parties in writing from time to time, namely:
If to the District: Orange County Sanitation District
10844 Ellis Avenue Fountain Valley, California 92708
Attention: Director of Finance and Administrative Services
If to the Corporation: Orange County Sanitation District Financing Corporation
c/o Orange County Sanitation District
10844 Ellis Avenue Fountain Valley, California 92708
Attention: Treasurer
If to the Trustee: Union Bank,N.A.
120 South San Pedro Street, Suite 400
Los Angeles, California 90012
Attention: Allison Braunstein
Each such notice, statement, demand, consent, approval, authorization, offer, designation,
request or other communication hereunder shall be deemed delivered to the party to whom it is
addressed (a) if personally served or delivered, upon delivery, (b) if given by electronic
communication, whether by facsimile or telecopier, upon the sender's receipt of an appropriate
answerback or other written acknowledgment, (c) if given by registered or certified mail, return
receipt requested, deposited with the United States mail postage prepaid, 72 hours after such
notice is deposited with the United States mail, (d) if given by overnight courier, with courier
charges prepaid, 24 hours after delivery to said overnight courier, or (e) if given by any other
means, upon delivery at the address specified in this Section.
Section 8.05. Successor Is Deemed Included in all References to Predecessor.
Whenever the District or the Corporation is named or referred to herein, such reference shall be
deemed to include the successor to the powers, duties and functions that are presently vested in
the District or the Corporation, and all agreements and covenants required hereby to be
performed by or on behalf of the District or the Corporation shall bind and inure to the benefit of
the respective successors thereof whether so expressed or not.
Section 8.06. Waiver of Personal Liability. No official, officer or employee of the
District shall be individually or personally liable for the payment of the Installment Payment, or
the interest thereon, or other payments required to be made by the District hereunder, but nothing
contained herein shall relieve any official, officer or employee of the District from the
performance of any official duty provided by any applicable provisions of law or hereby.
95713504.2 10
Section 8.07. Article and Section Headings, Gender and References. The headings
or titles of the several Articles and Sections hereof and the table of contents appended hereto
shall be solely for convenience of reference and shall not affect the meaning, construction or
effect hereof, and words of any gender shall be deemed and construed to include all genders. All
references herein to "Articles," "Sections" and other subsections or clauses are to the
corresponding articles, sections, subsections or clauses hereof; and the words "hereby," "herein,"
"hereof.. "hereto," "herewith" and other words of similar import refer to this Installment
Purchase Agreement as a whole and not to any particular Article, Section, subdivision or clause
hereof.
Section 8.08. Partial Invalidity. If any one or more of the agreements or covenants or
portions thereof required hereby to be performed by or on the part of the District or the
Corporation shall be contrary to law, then such agreement or agreements, such covenant or
covenants or such portions thereof shall be null and void and shall be deemed separable from the
remaining agreements and covenants and portions thereof and shall in no way affect the validity
hereof.
Section 8.09. Governing Law. This Installment Purchase Agreement shall be construed
and governed and construed in accordance with the laws of the State.
Section 8.10. Execution in Counterparts. This Installment Purchase Agreement may
be executed in several counterparts, each of which shall be deemed an original, and all of which
shall constitute but one and the same instrument.
95713504.2 11
IN WITNESS WHEREOF, the parties hereto have executed this Installment Purchase
Agreement by their officers thereunto duly authorized as of the day and year first written above.
ORANGE COUNTY SANITATION DISTRICT
By:
Chair of the Board of Directors
(SEAL)
Attest:
By:
Clerk of the Board of Directors
ORANGE COUNTY SANITATION
DISTRICT FINANCING CORPORATION
By:
Treasurer
95713504.2 12
EXHIBIT A
DESCRIPTION OF PROJECT
The Project includes in general the acquisition, construction and installation of certain
improvements to the wastewater collection, treatment and disposal facilities of the District and in
particular including, without limitation, the financing of improvements to the Wastewater
System including particularly, but without limitation, the District's collection system, two
wastewater treatment plants, and Ocean Outfall, and further as follows: the acquisition,
construction, installation, rehabilitation, replacement, or repair of the North County Yard,
Bushard Trunk Sewer, Gisler-Redhill Trunk Sewer, Magnolia Trunk Sewer, Bay Bridget Pump
Station, Bitter Point Pump Station, Ellis Avenue Pumps Station, Rocky Point Pump Station,
Headworks at Plant 2, Primary Clarifiers at Plant 1, Primary Treatment System at Plant 2
Secondary Treatment System at Plant 1, Activated Sludge at Plant 1, Trickling Filters at Plant 1
and 2; Sludge Digester at Plant 1, Sludge Dewatering at Plant 1 and 2, Truck Wash and
Dewatering Beds at Plant 1, Primary sludge Feed System at Plant 2, Digester at Plant 2, Effluent
Pump Station Annex, Groundwater Replenishment System, and Odor Control Facilities.
95713504.2 A-1
Fulbright & Jaworski L.L.P.— Draft 08/30/12
CONTINUING DISCLOSURE AGREEMENT
THIS CONTINUING DISCLOSURE AGREEMENT (this "Disclosure Agreement"),
dated as of October 1, 2012, is by and between the ORANGE COUNTY SANITATION
DISTRICT, a county sanitation district organized and existing under the laws of the State of
California (the "District"), and DIGITAL ASSURANCE CERTIFICATION LLC, as
Dissemination Agent (the "Dissemination Agent").
WITNESSETH:
WHEREAS, the District has caused to be executed and delivered the Orange County
Sanitation District Revenue Refunding Certificate Anticipation Notes, Series 2012C (the
"Notes"), evidencing principal in the aggregate amount of $ , pursuant to a Trust
Agreement, dated as of the date hereof (the "Trust Agreement"), by and among Union Bank,
N.A., as trustee (the "Trustee"), the Orange County Sanitation District Financing Corporation
(the "Corporation") and the District; and
WHEREAS, this Disclosure Agreement is being executed and delivered by the District
and the Dissemination Agent for the benefit of the owners and beneficial owners of the Notes
and in order to assist the underwriter of the Notes in complying with the Rule (as defined
herein);
NOW, THEREFORE, for and in consideration of the premises and of the mutual
covenants herein contained, the parties hereto agree as follows:
Section 1. Definitions. Capitalized undefined terms used herein shall have the
meanings ascribed thereto in the Trust Agreement or, if not defined therein, in the Master
Agreement, dated as of August 1, 2000, by and between the District and the Corporation. In
addition, the following capitalized terms shall have the following meanings:
"Disclosure Representative" means the Director of Finance and Administrative
Services of the District, or such other officer or employee of the District as the District shall
designate in writing to the Dissemination Agent and the Trustee from time to time.
"Dissemination Agent" means an entity selected and retained by the District, or any
successor thereto selected by the District. The initial Dissemination Agent shall be Digital
Assurance Certification LLC.
"EMMA" shall mean Electronic Municipal Market Access system, maintained on the
internet at http://emma.msrb.org by the MSRB.
"Listed Events" means any of the events listed in subsection (a) of Section 4 hereof and
any other event legally required to be reported pursuant to the Rule.
95713565.2
"MSRB" means the Municipal Securities Rulemaking Board established pursuant to
Section 1513(b)(1) of the Securities Exchange Act of 1934 or any other entity designated or
authorized by the SEC to receive reports pursuant to the Rule. Until otherwise designated by the
MSRB or the SEC, filings with the MSRB are to be made through EMMA.
"Participating Underwriter" means the original underwriter of the Notes required to
comply with the Rule in connection with the offering of the Notes.
"Repository" means, until otherwise designated by the Securities and Exchange
Commission, EMMA.
"Rule" means Rule 15c2-12 adopted by the Securities and Exchange Commission under
the Securities Exchange Act of 1934, as the same may be amended from time to time.
"SEC" shall mean the United States Securities and Exchange Commission.
Section 2. Reporting of Significant Events. (a) Pursuant to the provisions of this
Section 2, the District shall give, or cause to be given, notice of the occurrence of any of the
following events with respect to the Notes, in a timely manner not more than ten (10) Business
Days after the event:
(1) principal and interest payment delinquencies;
(2) defeasances;
(3) tender offers;
(4) rating changes;
(5) adverse tax opinions or the issuance by the Internal Revenue
Service of proposed or final determinations of taxability, Notices of Proposed
Issue (IRS Form 5701-TEB) or other material notices or determinations with
respect to the tax- status of the Notes;
(6) unscheduled draws on the debt service reserves reflecting financial
difficulties;
(7) unscheduled draws on credit enhancements reflecting financial
difficulties;
(8) substitution of credit or liquidity providers or their failure to
perform; or
(9) bankruptcy, insolvency, receivership or similar proceedings.
For these purposes, any event described in the immediately preceding paragraph (9) is
considered to occur when any of the following occur: the appointment of a receiver, fiscal agent,
or similar officer for the District in a proceeding under the United States Bankruptcy Code or in
95713565.2 2
any other proceeding under state or federal law in which a court or governmental authority has
assumed jurisdiction over substantially all of the assets or business of the District, or if such
jurisdiction has been assumed by leaving the existing governing body and officials or officers in
possession but subject to the supervision and orders of a court or governmental authority, or the
entry of an order confirming a plan of reorganization, arrangement, or liquidation by a court or
governmental authority having supervision or jurisdiction over substantially all of the assets or
business of the District.
(b) Pursuant to the provisions of this Section 2, the District shall give, or cause to be
given, notice of the occurrence of any of the following events with respect to the Notes, if
material:
(1) mergers, consolidations, acquisitions, the sale of all or
substantially all of the assets of the obligated persons or their termination;
(2) appointment of a successor or additional Trustee or the change of
the name of a Trustee;
(3) nonpayment related defaults;
(4) modifications to the rights of Owners;
(5) a notices of prepayment; or
(6) release, substitution or sale of property securing repayment of the
Notes.
(c) Whenever the District obtains knowledge of the occurrence of a Listed Event,
described in subsection (b) of this Section (2), the District shall as soon as possible determine if
such event would be material under applicable federal securities law.
(d) If the District determines that knowledge of the occurrence of a Listed Event
described in subsection (b) of this Section (2) would be material under applicable federal
securities law, the District shall promptly notify the Dissemination Agent in writing and instruct
the Dissemination Agent to report the occurrence to the Repository in a timely manner not more
than ten(10) Business Days after the event.
(e) If the Dissemination Agent has been instructed by the District to report the
occurrence of a Listed Event, the Dissemination Agent shall file a notice of such occurrence with
the MSRB and each Repository.
Section 3. Filings with the MSRB. All information, operating data, financial
statements, notices and other documents provided to the MSRB in accordance with this
Disclosure Agreement shall be provided in an electronic format prescribed by the MSRB and
shall be accompanied by identifying information as prescribed by the MSRB.
95713565.2 3
Section 4. Termination of Reporting Obligation. The District's obligations under
this Disclosure Agreement shall terminate upon the legal defeasance or payment in full of all of
the Notes. If such termination occurs prior to the final maturity of the Notes, the District shall
give notice of such termination in the same manner as for a Listed Event under Section 2 hereof.
Section 5. Dissemination Agent. The District may, from time to time, appoint or
engage another Dissemination Agent to assist it in carrying out its obligations under this
Disclosure Agreement, and may discharge any such Dissemination Agent, with or without
appointing a successor Dissemination Agent. If at any time there is not any other designated
Dissemination Agent, the Trustee shall be the Dissemination Agent; provided, it shall receive
written notice of such designation at the time of such designation.
Section 6. Amendment; Waiver. Notwithstanding any other provision of this
Disclosure Agreement, the District may amend this Disclosure Agreement, provided no
amendment increasing or affecting the obligations or duties of the Dissemination Agent shall be
made without the consent of such party, and any provision of this Disclosure Agreement may be
waived if such amendment or waiver is supported by an opinion of counsel expert in federal
securities laws acceptable to the District and the Dissemination Agent to the effect that such
amendment or waiver would not, in and of itself, cause the undertakings herein to violate the
Rule if such amendment or waiver had been effective on the date hereof but taking into account
any subsequent change in or official interpretation of the Rule.
Section 7. Additional Information. Nothing in this Disclosure Agreement shall be
deemed to prevent the District from disseminating any other information, using the means of
dissemination set forth in this Disclosure Agreement or any other means of communication, or
including any other information or notice of occurrence of a Listed Event, in addition to that
which is required by this Disclosure Agreement.
Section 8. Default. In the event of a failure of the District or the Dissemination
Agent to comply with any provision of this Disclosure Agreement, the Trustee, at the written
direction of any Participating Underwriter or the holders of at least 25% of the aggregate amount
of principal evidenced by Outstanding Notes and upon being indemnified to its reasonable
satisfaction, shall, or any holder or beneficial owner of the Notes may, take such actions as may
be necessary and appropriate, including seeking mandate or specific performance by court order,
to cause the District, the Trustee or the Dissemination Agent, as the case may be, to comply with
its obligations under this Disclosure Agreement. A default under this Disclosure Agreement
shall not be deemed an Event of Default under the Trust Agreement, and the sole remedy under
this Disclosure Agreement in the event of any failure of the District, the Trustee or the
Dissemination Agent to comply with this Disclosure Agreement shall be an action to compel
performance.
Section 9. Duties, Immunities and Liabilities of Dissemination Agent. The
Dissemination Agent shall not be responsible for the form or content of any notice of Listed
Event. The Dissemination Agent shall receive reasonable compensation for its services provided
under this Disclosure Agreement. The Dissemination Agent (if other than the Trustee or the
Trustee in its capacity as Dissemination Agent) shall have only such duties as are specifically set
forth in this Disclosure Agreement, and the District agrees to indemnify and save the
95713565.2 4
Dissemination Agent, its officers, directors, employees and agents, harmless against any loss,
expense and liabilities which it may incur arising out of or in the exercise or performance of its
powers and duties hereunder, including the costs and expenses (including attorney's fees) of
defending against any claim of liability, but excluding liabilities due to the Dissemination
Agent's negligence or willful misconduct. The obligations of the District under this Section
shall survive resignation or removal of the Dissemination Agent and payment of the Notes.
Section 10. Beneficiaries. This Disclosure Agreement shall inure solely to the benefit
of the District, the Trustee, the Dissemination Agent, the Participating Underwriter and holders
and beneficial owners from time to time of the Notes, and shall create no rights in any other
person or entity.
Section 11. Counterparts. This Disclosure Agreement may be executed in several
counterparts, each of which shall be an original and all of which shall constitute but one and the
same instrument.
95713565.2 5
IN WITNESS WHEREOF, the parties hereto have executed this Disclosure Agreement
as of the date first above written.
ORANGE COUNTY SANITATION DISTRICT
By:
Lorenzo Tyner
Director of Finance and Administrative Services
DIGITAL ASSURANCE CERTIFICATION LLC,
as Dissemination Agent
By:
Authorized Representative
Acknowledged and Accepted:
UNION BANK, N.A.,
as Trustee
By:
Authorized Officer
95713565.2 6
FJ DRAFT
09/19/12
PRELIMINARY OFFICIAL STATEMENT DATED OCTOBER_,2012
NEW ISSUE—BOOK-ENTRY-ONLY RATINGS:
S&P: " "
O o —
Fitch: " "
(See"RATINGS"herein.)
In the opinion of Fulbright&Jaworski L.L.P.,Los Angeles, California, Special Counsel, under existing statutes, regulations, rulings and
court decisions, and assuming compliance with the tax covenants described herein, the interest component of the Installment Payment, and the
0. o allocable portion thereof distributable in respect of any Note, is excluded pursuant to section 103(a)of the Internal Revenue Code of 1986 from
'y the gross income of the owners thereof for federal income tax purposes and is not an item of tax preference for purposes of the federal alternative
minimum tax.It is also the opinion of Special Counsel that under existing law interest on the Notes is exempt from personal income taxes of the
Cd State of California. See, however, "TAX MATTERS"herein.
[District Logo] $[PAR AMOUNT]' [DAC Logo]
o ORANGE COUNTY SANITATION DISTRICT
REVENUE REFUNDING CERTIFICATE ANTICIPATION NOTES
SERIES 2012C
Dated: Date of Delivery Maturity Date: October 30,2013
03
o Interest Rate: —% Price: % Yield: % CUSIP No.
b The$[PAR AMOUNT]*Orange County Sanitation District Revenue Refunding Certificate Anticipation Notes,Series 2012C(the"Notes")
evidence direct, fractional undivided interests of the Owners thereof in the installment payment (the "Installment Payment"), and the interest
thereon, to be made by the Orange County Sanitation District (the "District") pursuant to the Installment Purchase Agreement, dated as of
dOctober 1, 2012 (the "Installment Purchase Agreement"), by and between the District and the Orange County Sanitation District Financing
ed
Corporation (the "Corporation"). Pursuant to the Master Agreement for District Obligations, dated as of August 1, 2000 (the "Master
Agreement"),by and between the District and the Corporation,the District has established conditions and terms upon which obligations,such as
.� the Installment Payment and the interest thereon, will be incurred and secured. The Installment Payment under the Installment Purchase
Agreement is payable from (i)Net Revenues (as more fully described in the Master Agreement, the "Net Revenues"), as provided in the
o Installment Purchase Agreement,consisting primarily of all income and revenue received by the District from the operation or ownership of the
a� Wastewater System of the District (the "Wastewater System") remaining after payment of Maintenance and Operation Costs, and (ii)other
lawfully available funds of the District,as further described in"SECURITY AND SOURCES OF PAYMENT FOR THE NOTES"herein.
wThe Notes will mature on October 30,2013(the"Maturity Date"). The District expects the principal of and interest on the Notes to be paid
0 o from proceeds of the sale, on the Maturity Date, of a future series of certificates of participation,notes or other obligations of the District. The
Csale and delivery of a future series of certificates of participation,notes or other obligations of the District will depend on market conditions,
�F certain approvals by the District and the Corporation and other factors. See"SECURITY AND SOURCES OF PAYMENT FOR THE NOTES"
g herein.
t The proceeds of the Notes, together with other amounts, will be used to (i)pay at maturity all of the Orange County Sanitation District
Revenue Refunding Certificate Anticipation Notes, Series 201113,currently outstanding in the aggregate principal amount of$143,205,000,and
(ii)pay the costs incurred in connection with the execution and delivery of the Notes. See"PLAN OF FINANCE"herein.
Cd Interest evidenced by the Notes will accrue from the date of their initial delivery and will be payable on the Maturity Date. See "THE
NOTES"herein. The Notes initially will be delivered only in book-entry form and will be registered in the name of Cede&Co.,as nominee of
The Depository Trust Company,New York,New York("DTC"),which will act as securities depository for the Notes. Individual purchases of
o the Notes will be made in book-entry form only. Purchasers of Notes will not receive physical certificates representing their ownership interests
in the Notes purchased. The Notes will be delivered in denominations of$5,000 and any integral multiple thereof. Payments of principal and
0 o interest evidenced by the Notes are payable directly to DTC by Union Bank,N.A.,as trustee(the"Trustee"). Upon receipt of payments of such
principal and interest,DTC will in turn distribute such payments to the beneficial owners of the Notes. See APPENDIX E—"BOOK-ENTRY
o SYSTEM"herein.
THE OBLIGATION OF THE DISTRICT TO PAY THE INSTALLMENT PAYMENT, AND THE INTEREST THEREON, AND
OTHER PAYMENTS REQUIRED TO BE MADE BY IT UNDER THE INSTALLMENT PURCHASE AGREEMENT IS A SPECIAL
OBLIGATION OF THE DISTRICT PAYABLE, IN THE MANNER PROVIDED IN THE INSTALLMENT PURCHASE AGREEMENT,
•° FROM NET REVENUES AND OTHER LAWFULLY AVAILABLE FUNDS OF THE DISTRICT,AS PROVIDED IN THE INSTALLMENT
y PURCHASE AGREEMENT,AND DOES NOT CONSTITUTE A DEBT OF THE DISTRICT OR OF THE STATE OF CALIFORNIA,OR OF
ANY POLITICAL SUBDIVISION THEREOF, IN CONTRAVENTION OF ANY CONSTITUTIONAL OR STATUTORY DEBT
° LIMITATION OR RESTRICTION. NEITHER THE FAITH AND CREDIT NOR THE TAXING POWER OF THE STATE OF
CALIFORNIA, OR ANY POLITICAL SUBDIVISION THEREOF, IS PLEDGED TO THE PAYMENT OF THE INSTALLMENT
c PAYMENT, OR THE INTEREST THEREON, OR OTHER PAYMENTS REQUIRED TO BE MADE UNDER THE INSTALLMENT
cd_ PURCHASE AGREEMENT. SEE"SECURITY AND SOURCES OF PAYMENT FOR THE NOTES"HEREIN.
wo This cover page contains information intended for quick reference only. It is not a summary of this issue. Investors must read the entire
O Official Statement to obtain information essential to making an informed investment decision.
w BIDS FOR THE PURCHASE OF THE NOTES WILL BE RECEIVED BY THE DISTRICT UNTIL 11:30 A.M.NEW YORK TIME ON
° OCTOBER 18,2012 UNLESS POSTPONED OR CANCELLED AS SET FORTH IN THE OFFICIAL NOTICE INVITING BIDS.
° The Notes are offered when, as and if executed and delivered and received by as the Initial Purchaser, subject to the
aapproval of Fulbright&Jaworski L.L.P., Los Angeles, California, Special Counsel and Disclosure Counsel to the District, and certain other
conditions. Certain legal matters will be passed upon for the District and the Corporation by Woodruff, Spradlin & Smart, a Professional
H °
Preliminary,subject to change.
52224070.4
Corporation, Costa Mesa, California.Public Resources Advisory Group,Los Angeles, California, has served as financial advisor to the District
in connection with the execution and delivery of the Notes. It is anticipated that the Notes in definitive form will be available for delivery through
the book-entry facilities of DTC on or about October 30,2012.
Dated: October ,2012
52224070.4
[MAP]
52224070.4
ORANGE COUNTY SANITATION DISTRICT
Board of Directors
Troy Edgar (Chair)—Los Alamitos
John Anderson—(Vice Chair)— Yorba Linda
Gail Eastman—Anaheim Jon Dumitru Orange
Don Schweitzer—Brea Scott Nelson—Placentia
Fred Smith—Buena Park Sal Tinajero—Santa Ana
Prakash Narain—Cypress Michael Levitt—Seal Beach
Larry Crandall—Fountain Valley David Shawver Stanton
Greg Sebourn—Fullerton John Nielsen—Tustin
Bill Dalton—Garden Grove Brad Reese— Villa Park
Joe Carchio Huntington Beach James M.Ferryman Costa Mesa Sanitary District
Jeffrey Lalloway—Irvine John Withers—Irvine Ranch Water District
Tom Beamish—La Habra Joy L.Neugebauer—Midway City Sanitary District
Mark Waldman La Palma Janet Nguyen—Member of the Orange County
Steven Rosansky—Newport Beach Board of Supervisors
Executive Management of the District
James D. Ruth, General Manager
Robert P. Ghirelli,D.Env.,Assistant General Manager
James Herberg,Assistant General Manager
Lorenzo Tyner,Director of Finance and Administrative Services
Ed Torres,Director of Operations and Maintenance
Nick Arhontes,Director of Facilities Support Services
Jeff Reed,Director of Human Resources
Special Services
Special Counsel and Disclosure Counsel
Fulbright&Jaworski L.L.P.
Los Angeles,California
District General Counsel
Bradley R. Hogin
Woodruff, Spradlin& Smart, a Professional Corporation
Costa Mesa,California
Financial Advisor
Public Resources Advisory Group
Los Angeles,California
Trustee
Union Bank,N.A.
Los Angeles, California
52224070.4
No dealer, salesman or any other person has been authorized by the Orange County Sanitation District
(the"District") or the initial purchaser of the Notes listed on the cover page hereof(the "Initial Purchaser") to
give any information or to make any representations, other than those contained in this Official Statement,and,
if given or made, such other information or representations must not be relied upon as having been authorized
by the District or the Initial Purchaser.
This Official Statement does not constitute an offer to sell or the solicitation of an offer to buy nor
shall there be any sale of the Notes by any person in any jurisdiction in which it is unlawful for such person to
make such an offer, solicitation or sale. The information set forth herein has been provided by the District and
other sources that are believed by the District to be reliable.No dealer,broker, salesperson or other person has
been authorized to give any information or to make any representations other than those contained in this
Official Statement. If given or made, such other information or representations must not be relied upon as
having been authorized by the District, the Corporation or the Initial Purchaser in connection with any
reoffering.
This Official Statement is not to be construed as a contract with the purchasers of the Notes.
Statements contained in this Official Statement which involve estimates, projections, forecasts or matters of
opinion, whether or not expressly so described herein, are intended solely as such and are not to be construed
as representations of facts.
The information and expressions of opinion herein are subject to change without notice and neither
delivery of this Official Statement nor any sale made hereunder shall, under any circumstances, create any
implication that there has been no change in the affairs of the District or the Corporation since the date hereof.
This Official Statement is submitted with respect to the sale of the Notes referred to herein and may not be
reproduced or used,in whole or in part, for any other purpose,unless authorized in writing by the District. All
summaries of the documents and laws are made subject to the provisions thereof and do not purport to be
complete statements of any or all such provisions. Preparation of this Official Statement and its distribution
have been duly authorized and approved by the District and the Corporation.
In connection with the offering of the Notes, the Initial Purchaser in connection with any reoffering
may over-allot or effect transactions which stabilize or maintain the market price of the Notes at a level above
that which might otherwise prevail in the open market. Such stabilizing, if commenced, may be discontinued
at any time. The Initial Purchaser in connection with any reoffering may offer and sell the Notes to certain
dealers, institutional investors and others at prices lower than the public offering prices stated on the cover
page hereof and such public offering prices may be changed from time to time by the Initial Purchaser.
Certain statements included or incorporated by reference in this Official Statement constitute forward-
looking statements. Such statements are generally identifiable by the terminology used such as "plan,"
"expect," "estimate," "budget" or other similar words. The achievement of certain results or other
expectations contained in such forward-looking statements involve known and unknown risks, uncertainties
and other factors which may cause actual results, performance or achievements described to be materially
different from any future results, performance or achievements expressed or implied by such forward-looking
statements.
CUSIP is a registered trademark of the American Bankers Association. CUSIP data on the cover
hereof and herein is provided by CUSIP Global Services, managed by Standard & Poor's Financial Services
LLC on behalf of The American Bankers Association. This data is not intended to create a database and does
not serve in any way as a substitute for the CUSIP Services. The District,the Financial Advisor and the Initial
Purchaser are not responsible for the selection or correctness of the CUSIP numbers set forth on the cover
hereof or herein.
52224070.4
TABLE OF CONTENTS
Page
INTRODUCTION .......................................................................................................................................1
General ...........................................................................................................................................1
TheDistrict.....................................................................................................................................2
Security and Sources of Payment for the Notes..............................................................................2
ContinuingDisclosure....................................................................................................................3
Miscellaneous.................................................................................................................................3
PLANOF FINANCE...................................................................................................................................4
ESTIMATED SOURCES AND USES OF FUNDS ...................................................................................4
THENOTES................................................................................................................................................5
General ...........................................................................................................................................5
NoPrepayment ...............................................................................................................................5
SECURITY AND SOURCES OF PAYMENT FOR THE NOTES............................................................5
Sale Proceeds of Future Obligations...............................................................................................5
InstallmentPayment........................................................................................................................5
Available Funds of the District.......................................................................................................7
NetRevenues..................................................................................................................................7
RateStabilization Account.............................................................................................................8
Allocationof Revenues...................................................................................................................9
RateCovenant.................................................................................................................................9
Limitations on Issuance of Additional Obligations......................................................................10
Insurance.......................................................................................................................................12
Allocation of Installment Payment...............................................................................................12
THEDISTRICT.........................................................................................................................................14
Background...................................................................................................................................14
Organization and Administration..................................................................................................15
Services.........................................................................................................................................16
ServiceArea..................................................................................................................................16
Employees.....................................................................................................................................17
RetirementPlan.............................................................................................................................18
Other Post-Employment Benefits.................................................................................................20
RiskManagement.........................................................................................................................20
ExistingFacilities .........................................................................................................................20
Permits, Licenses and Other Regulations .....................................................................................22
2009 Facilities Master Plan and Capital Improvement Program..................................................23
Groundwater Replenishment System............................................................................................24
Preferred Level of Treatment........................................................................................................25
BiosolidsManagement..................................................................................................................25
UrbanRunoff................................................................................................................................27
Integrated Emergency Response Program....................................................................................27
Five-Year Strategic Planning........................................................................................................28
DISTRICT REVENUES............................................................................................................................29
SewerService Charges .................................................................................................................29
AdditionalRevenues.....................................................................................................................32
Wastewater Treatment History.....................................................................................................33
52224070.4 i
TABLE OF CONTENTS
(continued)
Page
Customers.....................................................................................................................................33
AssessedValuation.......................................................................................................................35
Tax Levies and Delinquencies......................................................................................................36
BudgetaryProcess.........................................................................................................................37
Reserves........................................................................................................................................38
Summaryof Operating Data.........................................................................................................39
ProjectedOperating Data..............................................................................................................41
Management's Discussion and Analysis of Operating Data.........................................................43
Investmentof District Funds.........................................................................................................44
FINANCIALOBLIGATIONS..................................................................................................................45
ExistingIndebtedness...................................................................................................................45
AnticipatedFinancings.................................................................................................................45
Direct and Overlapping Bonded Debt...........................................................................................46
THECORPORATION..............................................................................................................................46
LIMITATIONS ON TAXES AND REVENUES......................................................................................46
Article XIIIA of the California Constitution.................................................................................46
Legislation Implementing Article XIIIA......................................................................................47
Article XIIIB of the California Constitution.................................................................................47
Proposition 1A and Proposition 22...............................................................................................48
Article XIIIC and Article XIIID of the California Constitution...................................................49
OtherInitiative Measures..............................................................................................................51
LEGALMATTERS...................................................................................................................................51
FINANCIALADVISOR...........................................................................................................................51
ABSENCEOF LITIGATION...................................................................................................................52
FINANCIAL STATEMENTS...................................................................................................................52
TAXMATTERS........................................................................................................................................52
CONTINUING DISCLOSURE.................................................................................................................55
RATINGS..................................................................................................................................................55
PURCHASE AND REOFFERING...........................................................................................................55
MISCELLANEOUS..................................................................................................................................56
APPENDIX A — COMPREHENSIVE ANNUAL FINANCIAL REPORT OF THE
ORANGE COUNTY SANITATION DISTRICT FOR FISCAL YEAR
ENDED JUNE 30, 2011 ......................................................... .....................A-1
APPENDIX B — THE COUNTY OF ORANGE—ECONOMIC AND DEMOGRAPHIC
INFORMATION...............................................................................................B-1
APPENDIX C — SUMMARY OF PRINCIPAL LEGAL DOCUMENTS...................................C-1
APPENDIX D — FORM OF CONTINUING DISCLOSURE AGREEMENT.............................D-1
APPENDIX E — BOOK-ENTRY SYSTEM.................................................................................E-I
APPENDIX F — FORM OF APPROVING OPINION OF SPECIAL COUNSEL.......................F-1
52224070.4
ii
OFFICIAL STATEMENT
$[PAR AMOUNT]
ORANGE COUNTY SANITATION DISTRICT
REVENUE REFUNDING CERTIFICATE ANTICIPATION NOTES
SERIES 2012C
INTRODUCTION
This introduction contains only a brief summary of certain of the terms of the Notes being offered
and a brief description of the Official Statement. All statements contained in this introduction are
qualified in their entirety by reference to the entire Official Statement. References to, and summaries of,
provisions of the Constitution and laws of the State of California (the "State') and any documents
referred to herein do not purport to be complete and such references are qualified in their entirety by
reference to the complete provisions. All capitalized terms used in this Official Statement and not
otherwise defined herein have the meanings set forth in the Trust Agreement, the Installment Purchase
Agreement and the Master Agreement (each, as hereinafter defined). See APPENDIX C— "SUMMARY
OF PRINCIPAL LEGAL DOCUMENTS—Definitions"herein.
General
This Official Statement, including the cover page and all appendices hereto, provides certain
information concerning the sale and delivery of$[PAR AMOUNT]* aggregate principal amount of the
Orange County Sanitation District Revenue Refunding Certificate Anticipation Notes, Series 2012C (the
"Notes"), which are certificates of participation evidencing direct, fractional undivided interests in certain
installment payment (the "Installment Payment") and the interest thereon, to be made by the Orange
County Sanitation District (the "District") pursuant to the Installment Purchase Agreement, dated as of
October 1, 2012 (the "Installment Purchase Agreement"), by and between the District and the Orange
County Sanitation District Financing Corporation (the "Corporation"). Unless the context clearly
indicates to the contrary, a reference herein to either of the Installment Purchase Agreement or the Notes
is intended to refer to the corresponding interest in the Installment Purchase Agreement. Pursuant to the
Master Agreement for District Obligations, dated as of August 1, 2000 (the "Master Agreement"),by and
between the District and the Corporation, the District has established and declared the conditions and
terms upon which obligations such as the Installment Purchase Agreement, and the Installment Payment
and the interest thereon, will be incurred and secured. The Installment Payment under the Installment
Purchase Agreement is payable from (i)Net Revenues (as defined hereinafter) as provided in the
Installment Purchase Agreement, consisting primarily of all income and revenue received by the District
from the operation or ownership of the Wastewater System of the District (the "Wastewater System")
remaining after payment of Maintenance and Operation Costs, and (ii)other lawfully available funds of
the District, as further described in "SECURITY AND SOURCES OF PAYMENT FOR THE NOTES"
herein.
The Notes are to be executed and delivered pursuant to a Trust Agreement, dated as of October 1,
2012 (the "Trust Agreement"), by and among the District, the Corporation and Union Bank, N.A., as
trustee (the "Trustee"). Proceeds from the sale of the Notes will be used to (i)pay at maturity all of the
Orange County Sanitation District Revenue Refunding Certificate Anticipation Notes, Series 2011B,
currently outstanding in the aggregate principal amount of$143,205,000 (the "Prior Notes"), and(ii)pay
.Preliminary,subject to change.
52224070.4
the costs incurred in connection with the execution and delivery of the Notes. The Notes are not subject to
prepayment prior to their maturity. See"PLAN OF FINANCE"herein.
The Notes will be executed and delivered in the form of fully registered certificates, dated as of
the date of initial delivery thereof and will mature on October 30, 2013 (the "Maturity Date"). Interest
evidenced by the Notes will be payable on the Maturity Date. See "THE NOTES" herein. The Notes
initially will be delivered only in book-entry form and will be registered in the name of Cede & Co., as
nominee of The Depository Trust Company,New York, New York("DTC"), which will act as securities
depository for the Notes. The Notes will be delivered in denominations of $5,000 and any integral
multiple thereof. So long as the Notes are in the DTC book-entry system, the interest and principal due
with respect to the Notes will be payable by the Trustee, or its agent, to DTC or its nominee. DTC, in
turn, will make payments pursuant to its procedures as described under APPENDIX E — `BOOK—
ENTRY SYSTEM"herein.
The District
The District is a public agency responsible for regional wastewater collection, treatment and
disposal. The District is the sixth largest wastewater discharger in the United States. The District
provides service to an area with a population of approximately 2.5 million people in the northern and
central portion of the County of Orange (the "County"), in a service area of approximately 479 square
miles, treating an average of 207 million gallons per day("mg/d") of wastewater in Fiscal Year 2010-11.
See"THE DISTRICT,""DISTRICT REVENUES" and"FINANCIAL OBLIGATIONS"herein.
Security and Sources of Payment for the Notes
The Notes,which are certificates of participation evidence direct, fractional undivided interests in
the Installment Payment, and the interest thereon, paid by the District pursuant to the Installment
Purchase Agreement. The obligation of the District to pay the Installment Payment and the interest
thereon and other payments required to be made by it under the Installment Purchase Agreement is a
special obligation of the District payable, in the manner provided under the Installment Purchase
Agreement, from Net Revenues, and other lawfully available funds of the District, as provided in the
Installment Purchase Agreement. Net Revenues generally consist of all income and revenue received by
the District from the operation or ownership of the Wastewater System remaining after payment of
Maintenance and Operation Costs, all as further provided in the Master Agreement. The Installment
Purchase Agreement constitutes a Senior Obligation and, as such, is subject to the provisions of the
Master Agreement and is afforded all of the advantages, benefits, interests and security afforded Senior
Obligations pursuant to the Master Agreement.
The District expects the principal of and interest on the Notes to be paid from proceeds of the
sale, on the Maturity Date, of a future series of certificates of participation, notes or other obligations of
the District. The sale and delivery of a future series of certificates of participation, notes or other
obligations of the District will depend on market conditions, certain approvals by the District and the
Corporation and other factors. See"SECURITY AND SOURCES OF PAYMENT FOR THE NOTES—
Sale Proceeds of Future Obligations."
The Installment Purchase Agreement constitutes a Senior Obligation and, as such, is subject to
the provisions of the Master Agreement and is afforded all of the advantages, benefits, interests and
security afforded Senior Obligations pursuant to the Master Agreement. The District currently has
Outstanding Senior Obligations payable from Net Revenues on a parity with the Installment Payment
under the Installment Purchase Agreement. See "FINANCIAL OBLIGATIONS—Existing Indebtedness"
and "THE DISTRICT" herein and APPENDIX C — "SUMMARY OF PRINCIPAL LEGAL
52224070.4 2
DOCUMENTS — Master Agreement" attached hereto. The District has no Subordinate Obligations
currently outstanding.
Pursuant to the Master Agreement, the District will, to the extent permitted by law, fix,prescribe
and collect fees and charges for the services and facilities of the Wastewater System which will be at least
sufficient to yield during each Fiscal Year (a)Net Revenues equal to 125% of Debt Service on Senior
Obligations for such Fiscal Year and (b)Net Operating Revenues equal to 100% of Debt Service on all
Obligations for such Fiscal Year. The District may make adjustments from time to time in such fees and
charges and may make such classification thereof as it deems necessary, but shall not reduce the fees and
charges then in effect unless the Revenues and Net Revenues from such reduced fees and charges will at
all times be sufficient to meet the requirements of the Master Agreement. See "SECURITY AND
SOURCE OF PAYMENT FOR THE NOTES—Rate Covenant'herein.
The obligation of the District to pay the Installment Payment and the interest thereon, and
other payments required to be made by it under the Installment Purchase Agreement is a special
obligation of the District payable, in the manner provided in the Installment Purchase Agreement,
from Net Revenues and other lawfully available funds of the District, as provided for in the
Installment Purchase Agreement, and does not constitute a debt of the District or of the State, or of
any political subdivision thereof, in contravention of any constitutional or statutory debt limitation
or restriction. Neither the faith and credit nor the taxing power of the District or the State or any
political subdivision thereof, is pledged to the payment of the Installment Payment, or the interest
thereon, or other payments required to be made under the Installment Purchase Agreement. The
Installment Purchase Agreement constitutes a Senior Obligation and, as such, is subject to the
provisions of the Master Agreement and is afforded all of the advantages, benefits, interests and
security afforded Senior Obligations pursuant to the Master Agreement. See "SECURITY AND
SOURCES OF PAYMENT FOR THE NOTES"herein.
Continuing Disclosure
The District has covenanted for the benefit of holders and beneficial owners of the Notes to
provide notices of the occurrence of certain enumerated events. The specific nature of the information to
be contained in the notices of enumerated events is set forth in the Continuing Disclosure Agreement.
See "CONTINUING DISCLOSURE" herein and APPENDIX D — "FORM OF CONTINUING
DISCLOSURE AGREEMENT."
Miscellaneous
The descriptions herein of the Trust Agreement, the Master Agreement, the Installment Purchase
Agreement, the Continuing Disclosure Agreement and any other agreements relating to the Notes are
qualified in their entirety by reference to such documents. Copies of the Trust Agreement, the Master
Agreement and the Installment Purchase Agreement are on file and available for inspection at the
corporate trust office of Union Bank,N.A.,Los Angeles, California,Attention: Corporate Trust.
52224070.4 3
PLAN OF FINANCE
A portion of the net proceeds from the sale of the Notes, together with other available moneys,
will be used to pay at maturity the prior installment payment (the "Funded Installment Payment") to be
made by the District in connection with the Prior Notes. Under the terms of the Trust Agreement, dated
as of November 1, 2011 (the "Prior Trust Agreement"),pursuant to which the Prior Notes were executed
and delivered, the payment of the Prior Notes will be effected by investing a portion of the proceeds of
the Notes in certain Government Obligations and depositing same into the Installment Payment Fund
established under the Prior Trust Agreement (the "Payment Fund"). Such Government Obligations and
other moneys deposited by the District will be in an amount sufficient to provide for the payment of the
interest on the Funded Installment Payment through and including November 9, 2012 (the "Payment
Date") and to provide for the payment of the principal represented by the Funded Installment Payment. In
accordance with the Prior Trust Agreement, the Funded Installment Payment will be applied to the
payment of interest with respect to the outstanding Prior Notes and to the payment of the principal of the
outstanding Prior Notes on the maturity date thereof.
The amounts deposited in the Payment Fund will be held in trust solely for the Prior Notes and
will not be available to pay the principal and interest evidenced by the Notes or any obligations other than
the Prior Notes.
ESTIMATED SOURCES AND USES OF FUNDS
The estimated sources and uses of funds and other amounts in connection with the delivery of the
Notes are presented below.
Sources
Principal Amount of Notes $
Premium
District Contribution
Total Sources $
Uses
Payment of Prior Notes $
Costs of Issuance(l)
Total Uses $
Costs of Issuance include,among other things,the Initial Purchaser's discount, fees of rating agencies, Special
Counsel and Disclosure Counsel fees and expenses and the initial fees of the Trustee.
52224070.4 4
THE NOTES
General
The Notes will be prepared in the form of fully registered certificates in denominations of$5,000
and any integral multiple thereof. The Notes will be dated the date of initial delivery thereof and will
mature on the Maturity Date. The principal evidenced by the Notes shall be payable on the Maturity
Date. Interest evidenced by the Notes will accrue from their date of initial delivery and will be payable
on the Maturity Date. Interest evidenced by the Notes shall be computed on the basis of a 360-day year
consisting of twelve 30-day months. See APPENDIX C — "SUMMARY OF PRINCIPAL LEGAL
DOCUMENTS—Trust Agreement."
The Notes initially will be delivered only in book-entry form and will be registered in the name of
Cede & Co., as nominee of The Depository Trust Company,New York, New York("DTC"), which will
act as securities depository for the Notes. Individual purchases of the Notes will be made in book-entry
form only. Purchasers of Notes will not receive physical certificates representing their ownership
interests in the Notes purchased. Payments of principal and interest evidenced by the Notes are payable
directly to DTC by Union Bank, N.A., as trustee. Upon receipt of payments of such principal and
interest, DTC will in turn distribute such payments to the beneficial owners of the Notes. So long as the
Notes are held in the DTC book-entry system,the interest and principal due with respect to the Notes will
be payable by the Trustee, or its agent, to DTC or its nominee. DTC, in turn, will make payments
pursuant to its procedures as described under APPENDIX E—"BOOK-ENTRY SYSTEM"herein.
No Prepayment
The Notes are not subject to prepayment prior to their maturity.
SECURITY AND SOURCES OF PAYMENT FOR THE NOTES
Sale Proceeds of Future Obligations
The District expects the principal of and interest on the Notes to be paid from proceeds of the
sale, on the Maturity Date, of a future series of certificates of participation, notes or other obligations of
the District,that will amortize over a term of approximately 24 years (the"Future Obligations").
The issuance of the Future Obligations will require future authorizations by the governing boards
of the District and the Corporation, as well as the preparation of suitable legal and disclosure documents
for the issue. The District is currently unaware of any material impediment to obtaining such
authorizations and documents. In addition, the issuance and sale of the Future Obligations will be
contingent on the District's ability to access the municipal capital markets, which will depend on the
District's creditworthiness and market conditions during the weeks immediately preceding the Maturity
Date. The District is unable to predict such matters with certainty and therefore cannot guarantee that the
Future Obligations will be successfully issued and sold.
Installment Payment
The Notes evidence direct, fractional undivided interests in the Installment Payment, and the
interest thereon, paid by the District pursuant to the Installment Purchase Agreement. The obligation of
the District to pay the Installment Payment and the interest thereon and other payments required to be
made by it under the Installment Purchase Agreement is a special obligation of the District payable, in the
manner provided under the Installment Purchase Agreement, from Net Revenues and other lawfully
52224070.4 5
available funds of the District, as provided in the Installment Purchase Agreement. Net Revenues
generally consist of all income and revenue received by the District from the operation or ownership of
the Wastewater System remaining after payment of Maintenance and Operation Costs, all as further
provided in the Master Agreement. See"DISTRICT REVENUES"herein.
Pursuant to the Master Agreement, the District has established and declared the conditions and
terms upon which obligations such as the Installment Purchase Agreement, and the Installment Payment
and the interest thereon payable under the Installment Purchase Agreement, will be incurred and secured.
The obligation of the District to make the Installment Payment, and payments of interest thereon, and
other payments required to be made by it under the Installment Purchase Agreement, from Net Revenues,
and other lawfully available funds of the District,is absolute and unconditional, and until such time as the
Installment Payment, payments of interest thereon, and such other payments shall have been paid in full
(or provision for the payment thereof shall have been made pursuant to the Installment Purchase
Agreement), the District has covenanted that it will not discontinue or suspend any Installment Payment
when due, whether or not the Project or any part thereof is operating or operable or has been completed,
or its use is suspended, interfered with, reduced or curtailed or terminated in whole or in part, and such
Installment Payment, payments of interest thereon, and other payments shall not be subject to reduction
whether offset or otherwise and shall not be conditional upon the performance or nonperformance by any
party of any agreement or any cause whatsoever. The District's obligation to make the Installment
Payment from Net Revenues is on a parity with the District's obligation to make payments with respect to
its Outstanding Senior Obligations. See "Net Revenues" below. Pursuant to the Trust Agreement, the
Corporation has assigned to the Trustee for the benefit of the Owners of the Notes substantially all of its
rights, title and interest in and to the Installment Purchase Agreement, including its right to receive the
Installment Payment and the interest thereon.
The District has certain Existing Senior Obligations Outstanding payable from Net Revenues on a
parity with the Installment Payment under the Installment Purchase Agreement. The term "Existing
Senior Obligations" as used in this Official Statement refers to the Installment Purchase Agreements
relating to the District's Outstanding Senior Obligations, as set forth on Table 16 under the caption
"FINANCIAL OBLIGATIONS—Existing Indebtedness"herein. The term"Senior Obligations" as used
in this Official Statement refers to the Existing Senior Obligations and to any additional Senior
Obligations, such as the Installment Purchase Agreement, that may be made payable on a parity basis to
the Installment Payment as provided in the Master Agreement. Senior Obligations, together with any
Subordinate Obligations payable on a subordinate basis to the Installment Payments incurred as provided
in the Master Agreement, are referred to collectively as the "Obligations." The District has no
Subordinate Obligations currently outstanding. See "FINANCIAL OBLIGATIONS Existing
Indebtedness" herein and APPENDIX C "SUMMARY OF PRINCIPAL LEGAL DOCUMENTS
Master Agreement"attached hereto.
The obligation of the District to pay the Installment Payment, and the interest thereon, and other
payments required to be made by it under the Installment Purchase Agreement and Master Agreement, is
a special obligation of the District payable, in the manner provided in the Installment Purchase
Agreement, from Net Revenues and other lawfully available funds of the District, as provided for in the
Installment Purchase Agreement, and does not constitute a debt of the District, the State or of any
political subdivision thereof, in contravention of any constitutional or statutory debt limitation or
restriction. Neither the faith and credit nor the taxing power of the District, the State or any political
subdivision thereof, is pledged to the payment of the Installment Payment, or the interest thereon, or other
payments required to be made under the Installment Purchase Agreement. The Installment Purchase
Agreement constitutes a Senior Obligation and, as such, is subject to the provisions of the Master
Agreement and is afforded all of the advantages, benefits, interests and security afforded Senior
52224070.4 6
Obligations pursuant to the Master Agreement. See"SECURITY AND SOURCES OF PAYMENT FOR
THE NOTES"herein.
Available Funds of the District
As Senior Obligations under the Master Agreement, the Installment Payments are payable from
and secured by a pledge of Net Revenues. Should Net Revenues prove insufficient, the Installment
Purchase Agreement further provides that the Installment Payments are payable from any other lawfully
available funds of the District. The primary lawfully available funds of the District are its reserve funds,
other than trustee-held amounts required to be in any Obligation Reserve Fund securing certain of the
District's Senior Obligations, as described in the Master Agreement. At June 30, 2011, the District's
Debt Service Required Reserves totaled $138 million, of which $63.4 million were trustee-held amounts
in Obligation Reserve Funds as required under the Master Agreement. See APPENDIX C—"SUMMARY
OF PRINCIPAL LEGAL DOCUMENTS - Master Agreement" attached hereto. District reserve funds
are maintained in accordance with the District's reserve policy. See "DISTRICT REVENUES -
Reserves." Available reserves at June 30, 2011 and June 30, 2012 were approximately $614 million and
608 million, respectively. Available reserves at June 30, 2013 are projected to be approximately $614
million. See "DISTRICT REVENUES — Reserves," "— Summary of Operating Data" and "—
Projected Operating Data."
Net Revenues
The District is obligated to make the Installment Payment from, among other things, Net
Revenues as provided in the Master Agreement, which consist of Revenues remaining after payment of
costs paid by the District for maintaining and operating the Wastewater System ("Maintenance and
Operation Costs"). Revenues are defined in the Master Agreement to mean, for any period, all income
and revenue received by the District during such period from the operation or ownership of the
Wastewater System, determined in accordance with generally accepted accounting principles, including
all fees and charges received during such period for the services of the Wastewater System, investment
income received during such period (but only to the extent that such investment income is generally
available to pay costs with respect to the Wastewater System, including Maintenance and Operation
Costs), Net Proceeds of business interruption insurance received during such period, ad valorem taxes
received during such period, payments under the Agreement Acquiring Ownership Interests, Assigning
Rights and Establishing Obligations, entered into on February 13, 1986, and amendment No. 1 thereto
dated December 10, 1986 (the "IRWD Agreement"), by and between predecessor County Sanitation
District No. 14 of Orange County and the Irvine Ranch Water District(the"IRWD")received during such
period and all other money received during such period howsoever derived by the District from the
operation or ownership of the Wastewater System or arising from the Wastewater System (including any
standby or availability charges), but excluding (a)Capital Facilities Capacity Charges, (b)payments
received under Financial Contracts, and (c)refundable deposits made to establish credit and advances or
contributions in aid of construction (which, for purposes of the Master Agreement, shall not include
payments under the IRWD Agreement); provided, however, that (i)Revenues shall be increased by the
amounts, if any, transferred during such period from the Rate Stabilization Account to the Revenue
Account and shall be decreased by the amounts, if any, transferred during such period from the Revenue
Account to the Rate Stabilization Account, and (ii)Revenues shall include Capital Facilities Capacity
Charges collected during such period to the extent that such Capital Facilities Capacity Charges could be
properly expended on a Capital Facilities Capacity Charge Eligible Project for which the proceeds of
Senior Obligations were used or are available to be used. Any Federal Subsidy payments received by the
District will constitute Revenues as defined in the Master Agreement. See "DISTRICT REVENUES —
Additional Revenues"herein.
52224070.4 7
The District's obligation to make the Installment Payment from its Net Revenues is on a parity
with the District's obligation to make payments with respect to its other outstanding obligations described
as Senior Obligations and all Reimbursement Obligations with respect to Senior Obligations, as provided
in the Master Agreement. The Installment Purchase Agreement constitutes a Senior Obligation and, as
such, is subject to the provisions of the Master Agreement and is afforded all of the advantages, benefits,
interests and security afforded Senior Obligations pursuant to the Master Agreement. Pursuant to the
Master Agreement, the District pledges all Net Revenues to the payment of the Senior Obligations and
Reimbursement Obligations with respect to Senior Obligations, and the Net Revenues will not be used for
any other purpose while any of the Senior Obligations or Reimbursement Obligations with respect to
Senior Obligations remain unpaid; provided, however, that out of the Net Revenues there may be
apportioned such sums for such purposes as are expressly permitted by the Master Agreement. This
pledge constitutes a first lien on the Net Revenues for the payment of the Senior Obligations and
Reimbursement Obligations with respect to Senior Obligations. The term"Senior Obligations,"generally
means all revenue bonds or notes(including bond anticipation notes and commercial paper)of the District
authorized, issued, executed and delivered under and pursuant to applicable law,the Installment Purchase
Agreement, and all other contracts (including financial contracts) or leases of the District authorized and
executed by the District under and pursuant to applicable law, including, without limitation, installment,
lease or other payments which are, in accordance with the provisions of the Master Agreement, payable
from Net Revenues on a parity with the payments under the Master Agreement.
The District may at any time incur Subordinate Obligations payable on a subordinate basis to the
Installment Payment as provided in the Master Agreement; provided, however, that prior to incurring
such Subordinate Obligations, the District shall have determined that the incurrence thereof will not
materially adversely affect the District's ability to comply with the requirements of the Master
Agreement. The District may at any time incur Reimbursement Obligations with respect to Subordinate
Obligations. For a description of the District's Outstanding Senior Obligations and Subordinate
Obligations, see "FINANCIAL OBLIGATIONS — Existing Indebtedness" herein. There are currently
no Subordinate Obligations or Reimbursement Obligations with respect to Subordinate Obligations
outstanding.
The District may, in connection with the incurrence of Subordinate Obligations, pledge Net
Revenues to the payment of Subordinate Obligations and Reimbursement Obligations with respect to
Subordinate Obligations; provided, however, that such pledge, and any lien created thereby, shall be
junior and subordinate to the pledge of, and lien on,Net Revenues for the payment of Senior Obligations
and Reimbursement Obligations with respect to Senior Obligations.
Rate Stabilization Account
To avoid fluctuations in its fees and charges of the Wastewater System, from time to time the
District may deposit in the Rate Stabilization Account from Net Revenues such amounts as the District
deems necessary or appropriate. From time to time, the District may also transfer moneys from the Rate
Stabilization Account to the Revenue Account to be used by the District, first to pay all Maintenance and
Operations Costs as and when the same shall be due and payable. In addition, any such amount
transferred from the Rate Stabilization Account to the Revenue Account by the District is included as
Revenues for any period, but such transferred amount is excluded from determining Operating Revenues
for any period. Revenues will be decreased by the amounts, if any,transferred from the Revenue Account
to the Rate Stabilization Account. There are presently no funds in the Rate Stabilization Account.
52224070.4 8
Allocation of Revenues
To carry out and effectuate the pledge of Net Revenues under the Master Agreement as described
above, the District agrees and covenants that all Operating Revenues received by the District will be
deposited when and as received in the Revenue Account. Additionally, amounts may, from time to time
as the District deems necessary or appropriate, be transferred from the Rate Stabilization Account and
deposited in the Revenue Account, as described above under"—Rate Stabilization Account"above. The
District will pay from the Revenue Account all Maintenance and Operations Costs (including amounts
reasonably required to be set aside in contingency reserves for Maintenance and Operations Costs, the
payment of which is not immediately required)as and when the same shall be due and payable.
After having paid, or having made provisions for the payment of, Maintenance and Operations
Costs, the District shall set aside and deposit or transfer, as the case may be, from the Revenue Account
such amounts at such times as provided in the Master Agreement in the following order of priority:
(1) Senior Obligation Payment Account;
(2) Senior Obligation Reserve Funds (the Notes are not secured by any Reserve Fund);
(3) Subordinate Obligation Payment Account;
(4) Subordinate Obligation Reserve Funds; and
(5) Rate Stabilization Account.
Amounts required or permitted to be deposited or transferred as described in items 2, 3, 4 and 5
above, shall not be so deposited or transferred unless the District shall have determined that there will be
sufficient Net Revenues available to make the required deposits or transfers on the dates on which such
deposits or transfers are required to be made as described above. So long as the District has determined
that Net Revenues will be sufficient to make all of the deposits or transfers required to be made pursuant
to items 1, 2, 3, 4 and 5 above, on the dates on which such deposits or transfers are required to be made,
Net Revenues on deposit in the Revenue Account may from time to time be used for any purpose for
which the District funds may be legally applied. For additional information, see APPENDIX C
"SUMMARY OF PRINCIPAL LEGAL DOCUMENTS—Master Agreement."
Rate Covenant
Pursuant to the Master Agreement, the District will, to the extent permitted by law, fix,prescribe
and collect fees and charges for the services of the Wastewater System which will be at least sufficient to
yield during each Fiscal Year (a)Net Revenues equal to 125% of Debt Service on Senior Obligations for
such Fiscal Year and (b)Net Operating Revenues equal to 100% of Debt Service on all Obligations for
such Fiscal Year. The District may make adjustments from time to time in such fees and charges and may
make such classification thereof as it deems necessary, but will not reduce the fees and charges then in
effect unless the Revenues and Net Revenues from such reduced fees and charges will at all times be
sufficient to meet the requirements of the Master Agreement.
In addition, the District has covenanted in the Master Agreement to prepare and adopt an annual
budget for the Wastewater System for each Fiscal Year. Such budget will set forth in reasonable detail
the Revenues anticipated to be derived in such Fiscal Year and the expenditures anticipated to be paid or
provided for therefrom in such Fiscal Year, including, without limitation, the amounts required to pay or
provide for the payment of the Obligations during such Fiscal Year, the amounts required to pay or
52224070.4 9
provide for the payment of Maintenance and Operations Costs during such Fiscal Year and the amounts
required to pay or provide for the payment of all other claims or obligations required to be paid from
Revenues in such Fiscal Year,and will show that Revenues and Net Revenues will be at least sufficient to
satisfy the requirements of the Master Agreement. On or before September 1 of each Fiscal Year, the
District will file with the Trustee a copy of the adopted budget for such Fiscal Year. See APPENDIX C
— "SUMMARY OF PRINCIPAL LEGAL DOCUMENTS — Master Agreement" for additional
information.
The District has an established reserve policy with eight separate reserve fund categories. Over
the next ten years,the year ending reserve total for each year is projected not to fall below$458 million as
indicated in the District's ten-year cash flow forecast for fiscal years 2012-13 through 2021-22. At its
election,the District may use unrestricted reserves to help satisfy the rate covenant described above. See
"DISTRICT REVENUES —Reserves"herein.
Limitations on Issuance of Additional Obligations
Senior Obligations. The District may at any time incur Senior Obligations in addition to the
Existing Senior Obligations payable from Net Revenues as provided in the Master Agreement on a parity
with all other Senior Obligations theretofore incurred but only subject to the following conditions under
the Master Agreement:
(1) Upon the incurrence of such Senior Obligations, no Event of Default will be continuing
under the Master Agreement; and
(2) Subject to the provisions of the Master Agreement, the District will have received either
one of the following:
(i) A Written Certificate of the District certifying that, for a 12 consecutive calendar
month period during the 24 consecutive calendar month period ending in the
calendar month prior to the incurrence of such Senior Obligations (which 12
consecutive calendar month period will be specified in such certificate or
certificates):
(A) Net Revenues, as shown by the books of the District,will have amounted
to at least 125% of Maximum Annual Debt Service on all Senior
Obligations to be outstanding immediately after the incurrence of such
Senior Obligations, and
(B) Net Operating Revenues, as shown by the books of the District,will have
amounted to at least 100% of Maximum Annual Debt Service on all
Obligations to be outstanding immediately after the incurrence of such
Senior Obligations.
For purposes of demonstrating compliance with the foregoing,Net Revenues and
Net Operating Revenues may be adjusted for(x) any changes in fees and charges
for the services of the Wastewater System which have been adopted and are in
effect on the date such Senior Obligations are incurred, but which, during all or
any part of such 12 consecutive calendar month period, were not in effect,
(y) customers added to the Wastewater System subsequent to such 12
consecutive calendar month period but prior to the date such Senior Obligations
are incurred, and (z) the estimated change in available Net Revenues and Net
52224070.4 10
Operating Revenues which will result from the connection of existing residences
or businesses to the Wastewater System within one year following completion of
any project to be funded or any system to be acquired from the proceeds of such
Senior Obligations; or
(ii) A certificate or certificates from one or more Consultants which, when taken
together, project that, for each of the two Fiscal Years next succeeding the
incurrence of such Senior Obligations:
(A) Net Revenues will amount to at least 125% of Maximum Annual Debt
Service on all Senior Obligations to be outstanding immediately after the
incurrence of such Senior Obligations,and
(B) Net Operating Revenues will amount to at least 100% of Maximum
Annual Debt Service on all Obligations to be outstanding immediately
after the incurrence of such Senior Obligations.
For purposes of demonstrating compliance with the foregoing,Net Revenues and
Net Operating Revenues may be adjusted for(x) any changes in fees and charges
for the services of the Wastewater System which have been adopted and are in
effect on the date such Senior Obligations are incurred or will go into effect prior
to the end of such two Fiscal Year period, (y) customers expected to be added to
the Wastewater System prior to the end of such two Fiscal Year period, and (z)
the estimated change in available Net Revenues and Net Operating Revenues
which will result from the connection of existing residences or businesses to the
Wastewater System within one year following completion of any project to be
funded or any system to be acquired from the proceeds of such Senior
Obligations. For purposes of preparing the certificate or certificates described
above, the Consultant may rely upon financial statements prepared by the District
that have not been subject to audit by an independent certified public accountant
if audited financial statements for the period are not available.
See, also "FINANCIAL OBLIGATIONS — Existing Indebtedness" herein. The District is not
required to comply with the provisions described above in paragraph (2) if the Senior Obligations being
incurred are Short-Term Obligations excluded from the calculation of Assumed Debt Service pursuant to
clause (H) of the definition thereof. See APPENDIX C — "SUMMARY OF PRINCIPAL LEGAL
DOCUMENTS—Definitions"herein.
The determination of Net Revenues for use in the calculation described above is more fully
described in APPENDIX C — "SUMMARY OF PRINCIPAL LEGAL DOCUMENTS — Master
Agreement — Senior Obligations" attached hereto. The District is not required to comply with the
provisions described in paragraph (2) above for such portion of Senior Obligations incurred for the
purpose of providing funds to refund or refinance Senior Obligations if (i)upon such refunding or
refinancing, debt service on such refunded or refinanced Obligations, or debt service on bonds, notes or
other obligations of an entity other than the District,the debt service on which is payable from Obligation
Payments for such Obligations (the "Related Bonds"), will no longer be included in the calculation of
Assumed Debt Service either because such Obligations, or the Related Bonds of such Obligations, will
have been paid in full or because such debt service is disregarded pursuant to clause (L) of the definition
of Assumed Debt Service, and (ii)Assumed Debt Service in each Fiscal Year for the portion of such
Senior Obligations incurred for the purpose of providing funds to refund or refinance such Obligations is
less than or equal to 105% of Assumed Debt Service in such Fiscal Year for such Obligations being
52224070.4 11
refunded or refinanced (assuming for such purposes that debt service on such refunded or refinanced
Obligations, or debt service on the Related Bonds of such Obligations, is not disregarded pursuant to
clause (L) of the definition of Assumed Debt Service). See APPENDIX C — "SUMMARY OF
PRINCIPAL LEGAL DOCUMENTS—Master Agreement' attached hereto for additional information.
The District may at any time incur Reimbursement Obligations with respect to Senior
Obligations.
Subordinate Obligations. The District may at any time incur Subordinate Obligations upon
satisfaction of the conditions provided in the Master Agreement. See APPENDIX C—"SUMMARY OF
PRINCIPAL LEGAL DOCUMENTS—Master Agreement'herein for a description of such conditions.
Insurance
The District will procure and maintain or cause to be procured and maintained casualty insurance
on the Wastewater System with responsible insurers, or provide self-insurance(which may be provided in
the form of risk-sharing pools), in such amounts and against such risks (including accident to or
destruction of the Wastewater System) as are usually covered in connection with facilities similar to the
Wastewater System. The District will procure and maintain such other insurance which it will deem
advisable or necessary to protect its interests and the interests of the Corporation. See "THE DISTRICT
—Risk Management' and APPENDIX C—"SUMMARY OF PRINCIPAL LEGAL DOCUMENTS—
Master Agreement'herein.
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52224070.4 12
Allocation of Installment Payment
Set forth in Table 1 below is the estimated Installment Payment with respect to the Notes. Also
set forth are the payments due on Other Senior Obligations, excluding the Prior Notes. The District
ultimately expects the Notes to be paid with obligations that will amortize over a term of approximately
24 years,but there is no guarantee that such refinancing will occur.
Table 1
Estimated Installment Payment and Outstanding
Existing Senior Obligations of the District
Fiscal Year Installment Payment Other Senior
Ending Relating to Notes Obligation Paymentst1l
June 30 Principal Interest Principal Interest(2) Total
2013(2) $ 9,575,000 $ 27,990,813 $ 37,565,813
2014 $ $ 39,590,000 55,461,017 95,051,017
2015 27,875,000 54,299,011 82,174,011
2016 29,405,000 53,125,356 82,530,356
2017 35,575,000 51,756,369 87,331,369
2018 33,170,000 50,228,169 83,398,169
2019 32,735,000 49,096,419 81,831,419
2020 34,370,000 47,462,519 81,832,519
2021 36,005,000 45,829,319 81,834,319
2022 30,065,000 44,071,069 74,136,069
2023 31,550,000 42,584,979 74,134,979
2024 32,965,000 41,169,979 74,134,979
2025 34,575,000 39,556,359 74,131,359
2026 35,995,000 38,139,691 74,134,691
2027 38,105,000 36,376,341 74,481,341
2028 39,875,000 34,569,066 74,444,066
2029 41,720,000 32,677,491 74,397,491
2030 44,585,000 30,698,066 75,283,066
2031 57,225,000 28,604,641 85,829,641
2032 69,775,000 26,245,769 96,020,769
2033 85,305,000 22,816,786 108,121,786
2034 44,765,000 18,727,006 63,492,006
2035 46,935,000 16,307,232 63,242,232
2036 49,220,000 13,771,510 62,991,510
2037 51,610,000 11,113,614 62,723,614
2038 34,290,000 8,325,855 42,615,855
2039 35,920,000 6,395,648 42,315,648
2040 24,575,000 4,375,150 28,950,150
2041 20,805,000 2,912,640 23,717,640
2042 12,430,000 1,581,120 14,011,120
2043 9,795,000 785,600 10,580,600
2044 2,480,000 158,720 2,638,720
Total $ - 1,152,865,000 937.213.320 $2,090,078.320
(1) Excludes the Prior Notes.
(2) Excludes interest and principal due prior to November 10,2012.
52224070.4 13
THE DISTRICT
Background
The Orange County Sanitation District is a public agency responsible for regional wastewater
collection, treatment and disposal. The District is the sixth largest wastewater discharger in the United
States. The District provides service to an area with a population of approximately 2.5 million people in
the northern and central portion of the County by treating an average of 207 mg/d of wastewater in Fiscal
Year 2010-11. The District serves approximately 8 1% of the County population in approximately 479
square miles,or approximately 60%of the County's area.
The service area which comprises the District was originally formed in 1954 pursuant to the
County Sanitation District Act, as amended, Section 4700 et seq. of the Health and Safety Code of the
State. The District's service area originally consisted of seven independent special districts in the County
which were each responsible for matters relating to their individual districts. These special districts were
jointly responsible for the treatment and disposal facilities which they each used. The seven independent
districts were successors to the Joint Outfall Sewer Organization, which was formed in 1923 among the
Cities of Anaheim, Santa Ana, Fullerton, and Orange, and the sanitary districts of Placentia, Buena Park,
La Habra, and Garden Grove. The Joint Outfall Sewer Organization constructed a treatment plant and
outfall in the early 1920s to serve its members. It was reorganized in 1947 and 1948 into seven county
sanitation districts — District Nos. 1, 2, 3, 5, 6, 7 and 11. These prior districts were formed based on
engineers' analyses of the gravity flows in the service area. District No. 13 was formed in 1985 and
District No. 14 was added in 1986. These districts were co-participants in a Joint Agreement which
provided for the joint construction,ownership, and operation of the prior districts'joint facilities.
In April 1998, at the request of the Board of Directors of the District (the "Board of Directors"),
the Board of Supervisors of the County of Orange (the "County Board") passed Resolution No. 98-140
approving the consolidation of the then existing nine special districts into a new, single sanitation district,
to be known as the Orange County Sanitation District. This action was designed to simplify governance
structures, reduce the size of the Board of Directors, ease administrative processes, streamline decision-
making and consolidate accounting and auditing processes. The consolidation was effective on July 1,
1998.
Pursuant to the Resolution and Government Code Section 57500, the prior districts transferred
and assigned all of their powers, rights, duties, obligations, functions and properties to the District, and
the District assumed all obligations of the prior districts which were several and not joint including,
without limitation, their obligations to repay the then outstanding certificates of participation. The
boundaries of the nine predecessor special districts were initially used by the District to delineate separate
revenue areas (the "Revenue Areas") for budgeting and accounting purposes and in order to facilitate the
imposition of fees and charges imposed by the District. See "DISTRICT REVENUES — Sewer Service
Charges"herein.
The District is managed by the Board of Directors, whose members are appointed by 25 member
cities and agencies which are serviced by the District. The District is responsible for construction and
maintenance of a major portion of the wastewater collection, treatment and disposal facilities within its
boundaries. Revenue Area No. 7 is responsible for approximately 170 miles of local sewers in its service
area, whereas local sanitary districts, water districts and cities are responsible for local sewers in the
remainder of the District's service area.
52224070.4 14
Organization and Administration
The District is independent of and overlaps other political jurisdictions. There are many
governmental entities, including the County, that operate within the District's jurisdiction. These entities
are exclusively responsible for the administration of their own fiscal affairs, and the District is not entitled
to operating surpluses of,or responsible for operating deficits of, any of the other entities.
The 25-member Board of Directors is composed of representatives from 21 cities,unincorporated
areas of the County and three special districts, including mayors of cities, members of city councils,
directors of independent special districts and one member from the County Board. Several board
committees, made up of members of the Board of Directors, consider topics for action by the Board of
Directors and make recommendations to the Board of Directors. The Chair and the Vice Chair of the
Board of Directors are elected every year by a majority of the Board of Directors, and serve at the
pleasure of the majority of the Board of Directors.
The District has a general manager, outside general counsel, and administrative and operating
staff, with offices located at Reclamation Plant No. 1 in Fountain Valley, California. The District
currently employs an administrative and operating staff of approximately 600 under the direction of its
General Manager,James D. Ruth.
James D. Ruth is the District's General Manager, and has served in that capacity since
December 2005. Prior to that time, from January 2003 to October 2004, Mr. Ruth served as Chief
Executive Officer for the County of Orange. Mr. Ruth had previously provided 22 years of service to the
City of Anaheim as parks and recreation director, deputy city manager, assistant city manager and chief
executive officer, a post he held for 11 years.
Robert P. Ghirelli, D.Env. is an Assistant General Manager of the District, and has served in that
capacity since July 2006. Dr. Ghirelli previously served as Director of Technical Services for the District
since his joining the District in 1998. Prior to joining the District, Dr. Ghirelli served for just over a year
as managing principal of the Los Angeles office of a national environmental consulting firm, and served
20 years in supervisory positions with the State Water Resources Control Board and Regional Water
Quality Control Boards, including 13 years serving as Executive Officer of the California Regional Water
Quality Control Board,Los Angeles/Ventura Region.
James Herberg, P.E. is an Assistant General Manager of the District and has served in this
capacity since February 2011. He previously held the position of Director of Engineering, and served in
that capacity from November 2006 to June 2012. Prior to becoming Director of Engineering, he was the
District's Director of Operations and Maintenance. Mr. Herberg has over 20 years of experience in water
and wastewater including project management, construction management, design, strategic planning, and
operations&maintenance.
Lorenzo Tyner is the District's Director of Finance and Administrative Services. In
September 2005, Mr. Tyner joined the District with approximately 20 years of public finance and
budgeting experience, most recently serving as the Los Angeles Unified School District Budget Director
and Deputy Chief Financial Officer. Mr. Tyner previously worked in large government organizations
including the City of Los Angeles and the Los Angeles County Metropolitan Transportation Authority
and with private sector companies IBM Global Services and TRW Space and Defense.
Ed Torres is the District's Director of Operations and Maintenance for the District. He has
served the District since 1991. Prior to joining the District, Mr. Torres served in a professional capacity
for the California State University System and TRW Electronics and Defense Sector. Mr. Torres has
52224070.4 15
approximately 25 years of public and private sector experience in protecting public health and the
environment.
Nick Arhontes, P.E. is the District's Director of Facilities Support Services and has served the
District since 1988. Mr. Arhontes has over 30 years of experience managing various engineered systems
in the private and public sectors regionally,nationally, and internationally.
Jeff Reed is the District's Director of Human Resources. He has worked for the District since
1987. Mr.Reed serves as the District's Employee Relations Officer, administering to employer-employee
relations between the District and its local public employee organizations. In addition to human resources,
Mr.Reed has served the District in leadership roles in both safety and operations.
Services
The District owns and operates regional wastewater collection, treatment, and disposal facilities
for the metropolitan area in the northern and central portion of the County. The District receives
wastewater from the collection systems of the cities, sanitary districts and unincorporated areas of the
County located within the District. See"THE DISTRICT—Service Areas"herein.
Generally, local agency systems collect wastewater from residential and industrial customers and
convey the wastewater to District trunk sewer pipelines for conveyance to the District's wastewater
treatment plants.
The District's staff is responsible for operating and maintaining the District's infrastructure,
although some work is performed by external contractors.
Currently, the District has established supply contracts for all chemicals necessary to the
operation and maintenance of the facilities of the District. The District has sufficient standby systems in
the event of equipment failures or system outages.
Service Area
The map on the inside cover of this Official Statement shows the District's boundaries and
selected cities located within the District. District boundaries were originally established in 1947 and
1948 based on drainage basins. As the existing cities have grown and new areas have incorporated, city
limits have come to overlap District boundaries. The District currently serves an approximately 479
square-mile area including 23 of the County's 33 cities and various unincorporated areas of the County.
The District serves a population of approximately 2.5 million residents.
52224070.4 16
Set forth in Table 2 below is the estimated populations of cities and unincorporated areas served
by the District as of January 1,2011.
Table 2
Estimated Populations of Cities and Unincorporated Areas
Served by the Orange County Sanitation District
As of January 1,2011
City Population
Anaheim 341,034
Brea 40,065
Buena Park 80,868
Costa Mesa 110,146
Cypress 47,907
Fountain Valley 55,423
Fullerton 135,574
Garden Grove 171,327
Huntington Beach 190,377
Irvine 219,156
La Habra 60,432
La Palma 15,596
Los Alamitos 11,474
Newport Beach 85,376
Orange 136,995
Placentia 50,665
Santa Ana 325,228
Seal Beach 24,215
Stanton 38,317
Tustin 75,781
Villa Park 5,823
Westminster 89,937
Yorba Linda 64,855
Cities Subtotal 2,376,571
Unincorporated Areas (estimated) 81,000
Total 2 45
Sources: State of California Department of Finance, Demographic Research Unit for city population data; Orange
County Sanitation District for population of unincorporated areas.
Employees
As of September 1, 2012, the Orange County Sanitation had a total of 594 employees. The
majority of District employees are represented by recognized employee organizations, which include the
following: the Orange County Employees Association ("OCEA"), representing administrative/clerical,
technical services and engineering employees since 1979, the International Union of Operating Engineers
—Local 501 ("Local 501"), representing operations and maintenance employees since October 1985, and
the Peace Officers Counsel of California representing employees within the Supervisor and Professional
Groups since 1991. The total number of represented employees is 551, and is broken down as follows:
91 employees represented by OCEA, 205 employees represented by Local 501, and 255 employees
represented by the Supervisor and Professional Groups. The contractual agreements between District and
52224070.4 17
the Supervisor and Professional Groups were renegotiated in 2010 and expire on June 30, 2013. The
contractual agreements between OCEA and District and the Local 501 and District were renegotiated in
2011 and will expire on June 30,2014. District has historically enjoyed a good working relationship with
its employee organizations and has experienced no work stoppages by represented employees since the
early 1980s.
Retirement Plan
The District participates in the Orange County Employees Retirement System ("OCERS"), a
cost-sharing multiple-employer, defined benefit pension plan which is governed and administered by a
nine-member Board of Retirement. OCERS was established in 1945 under the provisions of the County
Employees Retirement Law of 1937, and provides members with retirement, death, disability, and cost of-
living benefits.
All District full-time employees, except the General Manager, participate in OCERS.
Contributions are based on an OCERS actuarial-determined rate structure and age at time of employment;
contributions are deducted on a pre-tax basis. Most employees do not pay into Social Security with the
exception of 1.45% of gross income, which is paid into the Medicare portion of Social Security. The
amount of the retirement allowance is based upon the member's age at retirement, the member's "final
compensation" as defined in Section 31462 of the Retirement Law of 1937, the total years of service
under OCERS, and the employee's classification as a Plan B, G or H member. Plan B applies to
supervisor and professional employees hired on or after October 1, 2010, Local 501 employees hired on
or after July 1,2011 and OCEA employees hired on or after August 1,2011. Plan G applies to employees
hired before September 21, 1979. Plan H applies to employees hired on or after September 21, 1979 and
prior to the eligibility dates for Plan B. Effective July 1, 2005, employees retiring at age 55 or older
receive 2.5% of their final compensation for every year of service. Plan G and H provide 2.5% of final
compensation per year of service at age 55. Plan B provides 1.667% of final compensation per year of
service at age 57.5. "Final compensation"is the highest consecutive 12 months of compensation for Plan
G members and the highest consecutive 36 months of compensation divided by three for Plan B and H
members. Benefits fully vest under the OCERS retirement plan upon reaching five years of service.
Employees who retire at or after age 50 with ten or more years of service are eligible to receive an annual
retirement allowance, but at a reduced benefit for those employees retiring prior to age 57.5 for Plan B
members or prior to age 55 for Plan G and H members. OCERS also provides death and disability
benefits.
As a condition of participation under the provisions of the County Employees Retirement Law of
1937, members are required to contribute a percentage of their annual compensation to OCERS. The
District is required to make periodic contributions to OCERS in amounts that are estimated to remain a
constant percentage of covered employees' compensation such that, when combined with covered
employees' contributions, they will fully provide for all covered employees' benefits by the time they
retire.
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52224070.4 18
Set forth in Table 13 below is a current comparison of the District's contributions to OCERS for
Fiscal Years 2006-07 through 2010-11 and projected costs for Fiscal Years 2011-12 and 2012-13.
Table 3
Orange County Sanitation District
Comparison of District Contributions to OCERS for Fiscal Years 2006-07 through 2010-11
and Projected Contributions for Fiscal Years 2011-12 and 2012-13
District
Fiscal Year Rate(l) Contributions
2006-07 19.78% $ 9,848,854
2007-08 20.55 11,011,693
2008-09 21.14 12,193,601
2009-10 21.50 13,029,795
2010-11 24.04 14,370,158
2011-12(3) 25.68 15,202,253
2012-13(2)(3) 27.45 16,575,000
(1) Required contribution as a percent of covered payroll. Includes amortization of Unfunded Actuarial Accrued
Liability.
(2) Projected.
(3) Combined rate for Plans B,G and H.
Source: Orange County Sanitation District.
For Fiscal Years 2006-07 through 2010-11, the District's required contribution was equal to the
contribution that the District actually made. As noted, the required contribution set forth above includes
amortization of Unfunded Actuarial Accrued Liability ("UAAL"). For the Fiscal Year ended June 30,
2012, total payroll costs of employees covered by OCERS was $59,246,189. As of the December 31,
2011 valuation, OCERS has an aggregate UAAL ratio of 67.03%, for a total UAAL on an actuarial basis
of$4.46 billion.
The District's retirement program includes Additional Retiree Benefit Account ("ARBA")
benefits. ARBA benefits provide a monthly payment to retirees towards the premium costs of health
insurance for the retiree and eligible dependents. The retiree is not required to use this amount for health
insurance premium or to remain on the OCERS medical plan. Benefits vest upon retirement after
qualifying public service of ten years. The District pays 100% of the cost for the ARBA plan and utilizes
a pay-as-you-go method for funding the plan. The District paid$248,410 in ARBA benefits during Fiscal
Year 2010-11. Effective August 1, 2011, ARBA benefits are no longer available to new OCEA Group
employees of the District.
For more information regarding OCERS and the District's retirement plan as of June 30, 2011,
see Note 6 to the Comprehensive Annual Financial Report of the Orange County Sanitation District for
Fiscal Year Ended June 30, 2011 set forth in Appendix A. The Comprehensive Annual Financial Reports
of the Orange County Employees Retirement System are available on the OCERS website at
http://www.ocers.org. The information on such website is not incorporated herein by such reference or
otherwise. The District cannot predict whether the OCERS investment portfolio will experience
additional losses in the future; however, any future losses could result in material increases in the
District's required contributions.
52224070.4 19
Other Post-Employment Benefits
In June 2004, Governmental Accounting Standards Board ("GASB") issued Statement No. 45,
which requires state and local governmental employers to fund the actuarially determined annual required
contribution ("ARC") for its post-employment benefits other than pension benefits (known as other post-
employment benefits or"OPEB") or record the entire amount of the unfunded liability of its OPEB in its
financial statements. OPEB includes healthcare and life insurance expenses and related liabilities, and an
annual required contribution to fund such liabilities. The District adopted Statement No. 45 for the fiscal
year beginning July 1, 2007, as required of a GASB "Phase 1 Agency." According to the District's
actuary, Demsey Filliger Associates (the "Actuary"), the unfunded OPEB liability as of July 1, 2011 is
approximately $10.7 million. The ARC is $900,035 for Fiscal Year 2011-12. Calculation of the ARC is
based on the present value of benefits accruing in the current year, a 30-year amortization of the unfunded
OPEB liability and an assumed rate of return on investments in the retiree fund of 5% per annum. The
District does not believe that its OPEB liability will have a material impact on its operational results.
Risk Management
As of the date hereof, the District has in force basic all risk property and casualty insurance,
including theft, fire, flood,terrorism and boiler and machinery losses at its plants and pump stations. The
District is self-insured for portions of workers' compensation,property damage and general liability. The
self-insurance portion of workers' compensation is $750,000 per person per occurrence with outside
excess insurance coverage to the statutory limit. The self-insured portion for property damage covering
fire and other disasters is $250,000 per occurrence with outside excess insurance coverage to $1 billion.
The self-insured portion for property damage covering flood is $100,000 per occurrence with outside
excess insurance coverage to $300 million. The District is self-insured for all property damage from the
perils of earthquakes. See "DISTRICT REVENUES — Reserves." The District also maintains outside
comprehensive boiler and machinery insurance, including business interruption insurance, with a $100
million limit with deductibles ranging from $25,000 to $350,000. The District is self-insured for general
liability coverage up to $250,000 per occurrence (except that employment practice liability is $500,000),
with excess general liability coverage up to $30 million.
During the past five fiscal years there have been no settlements in excess of covered amounts.
Claims against the District are processed by outside claim administrators. The District believes that there
are no unrecorded claims as of June 30, 2012 that would materially affect the financial position of the
District.
For more information regarding the District's insurance coverage as of June 30, 2011, see Note 1
to the Comprehensive Annual Financial Report of the Orange County Sanitation District for Fiscal Year
Ended June 30,2011 set forth in Appendix A.
Existing Facilities
The District's Wastewater System presently consists of two wastewater treatment plants, an
influent metering and diversion structure, 15 off-plant pump stations, various interplant pipelines and
connections, and the ocean outfall facilities. The District's Wastewater System includes approximately
403 miles of sewers within 11 trunk sewer systems, 170 miles of local sewers located within a portion of
Revenue Area No. 7, two treatment plants, two discharge outfalls and two emergency weir outlets. The
existing treatment plants have a rated primary treatment capacity of 372 mg/d, including standby capacity.
Treatment Plant No. 1 ("Plant No. 1") is located in the City of Fountain Valley, about four miles
from the coast, adjacent to the Santa Ana River. Secondary treatment capabilities are provided by a
52224070.4 20
trickling filter plant and a conventional air activated sludge plant. Up to 105 mg/d of secondary treated
effluent is conveyed to an Orange County Water District (the "OCWD")plant for tertiary treatment prior
to reclamation and groundwater recharge. See"Groundwater Replenishment System"below.
Treatment Plant No. 2 ("Plant No. 2") is located in the City of Huntington Beach, 1,500 feet from
the ocean, at the mouth of the Santa Ana River. Secondary treatment capabilities are provided by a pure
oxygen activated sludge plant.
The District employs several phases in the treatment of wastewater. The first phase, preliminary
treatment,removes debris such as eggshells, sand and other non-biodegradable items. See also "Preferred
Level of Treatment" and `Biosolids Management" below. In the next phase, primary treatment,
wastewater is pumped to large settling basins. The liquids are separated from the remaining solids which
settle or float as the wastewater passes through large settling basins called clarifiers. The settled solids
are sent to solids treatment facilities. Substantially all of the wastewater received by the District is sent to
secondary treatment for further processing because of the recent completion of the secondary expansion at
Treatment Plant No. 2. During secondary treatment, the wastewater is treated with naturally occurring
bacteria to remove most of the remaining dissolved and suspended microscopic organic solids. The
treated wastewater from both plants is mixed together at Plant No. 2, where it is then pumped through the
ocean outfall pipe that extends five miles offshore.
Set forth in Table 4 below are the treatment plants' approximate current and future treatment
capacities.
Table 4
Wastewater System Treatment Capacities
(mg/d)
2010-11 Existing Primary Total Planned
Actual Treatment Existing Secondary Secondary
Flows Capacity Treatment Capacity') Ca acit�2)
Plant No. 1 99 204 122 182
Plant No. 2 108 168 150 150
Aggregate Treatment 207 372 272 332
(1) The existing secondary capacity is being expanded to meet secondary treatment standards by December 2012.
(2) The District's "Planned Total Capacity" is based on the 2009 Facilities Master Plan for planned capacity by
2020, which estimated the District's requirements to meet future expected primary and secondary capacity
demands.
Source: Orange County Sanitation District.
The District also has the capability to divert a portion of the influent flow from Plant No. 1 to
Plant No. 2 through interplant connections. A portion of the flow destined for Plant No. 2 can also be
diverted to Plant No. 1. Another interplant facility allows gas generated during solids treatment to be
transported between Plant No. 1 and Plant No. 2 and allows digester gas (which is used as fuel for many
of the facilities' engines) from one plant to be used at the other to balance the supply and demand, which
results in efficient gas utilization.
52224070.4 21
Permits,Licenses and Other Regulations
The District is subject to laws, rules and permits issued by federal, state, regional and local
regulatory bodies. The Wastewater System is subject to regulations imposed by the 1972 Clean Water
Act, Public Law 92-500 (the "Clean Water Act"), the California Environmental Quality Act of 1970, as
amended ("CEQA") and the Federal Clean Air Act. The regulatory requirements are primarily
administered by the United States Environmental Protection Agency (the "EPA"), the California Air
Resources Board, the Santa Ana Regional Water Quality Control Board ("RWQCB"), and the South
Coast Air Quality Management District ("AQMD"). Regulations of these agencies deal primarily with
the quality of effluent which may be discharged from the treatment plants and air quality emissions. The
Clean Water Act directs the EPA to monitor and to regulate the discharge of pollution into navigable
waterways and to enforce the requirements that all wastewater treatment plants in the nation provide full
secondary treatment for sewage. In 1977, Congress amended the Clean Water Act to allow waivers of
secondary treatment standards for certain ocean dischargers if they can demonstrate,to the satisfaction of
the EPA that significant adverse environmental impacts would not occur. The District currently has all
applicable permits and licenses necessary to operate its facilities.
The District has discharged treated wastewater into the Pacific Ocean under a permit issued by
the EPA and the RWQCB. The discharge permit included a waiver under the 301(h) provisions of the
Clean Water Act, allowing for less than full secondary treatment based on an ocean discharge of
sufficient depth, distance and dilution. The permit was initially issued in 1985 and was the first modified
Section 301(h) permit issued to a major wastewater treatment facility. The permit was re-issued on May
6, 1998 and expired on June 8,2003.
On July 17, 2002,the Board of Directors adopted Resolution No. OCSD 02-14, "Establishing the
Policy for Level of Treatment of Wastewater Discharged into the Ocean." This resolution established the
District's policy to treat all wastewater discharges into the ocean to secondary treatment standards thereby
providing for continued public safety, marine ecosystem protection, and water reclamation opportunities.
To implement this policy, District staff was directed to immediately proceed with the planning, design,
and implementation of treatment methods that will allow the District to meet Clean Water Act secondary
treatment standards with the expressed purposes of eliminating the need for the permit waiver received
under Section 301(h). The District currently estimates that it will complete these improvements by
December 2012 at a total capital improvement cost of$623.1 million. In the interim,the District operates
the plants to maximize available secondary treatment and to reduce effluent biochemical oxygen demand
and suspended solid discharges below currently allowed limits.
Following the determination by the Board of Directors on July 2002 to implement full secondary
standards, staff prepared the Secondary Treatment National Pollutant Discharge Elimination System
("NPDES") Permit Application that was required to be submitted to the regional office of the EPA and
the RWQCB in December 2002. The NPDES Permit is separate and apart from the permit waiver
received under Section 301(h), and once awarded would negate the need for a waiver. Achieving
secondary treatment standards was originally projected to take nine years to complete, with completion
expected in December 2012. Because ocean discharge permits are issued for only five years, and the
EPA has no authority to waive the discharge limit requirements or grant a longer permit (except in
accordance with Section 301(h)), the District decided to voluntarily seek a consent decree concurrently
with the issuance of the new ocean discharge permit.
This negotiated consent decree(the "Consent Decree") approves the schedule and decrees that no
penalties will be imposed for discharges that exceed the secondary treatment limits during the period of
construction. The Consent Decree was signed by the District, the EPA and the RWQCB and filed with
the U.S. District Court on November 15, 2004. The Consent Decree contains seven construction
52224070.4 22
milestones and interim effluent limitations. The District is in compliance with the Consent Decree and has
successfully completed five of the seven milestones within the specified deadlines required by the
Consent Decree. The District expects to complete all seven milestones ahead of schedule, prior to
December 31,2012.
The District is also subject to the requirements of the Federal Clean Air Act which mandates
attainment with national ambient air quality standards for criteria pollutants (ozone, particulate matter,
carbon monoxide, lead,nitrogen dioxide, and sulfur dioxide). Criteria air pollutants cause adverse effects
on human health and environment. AQMD is the local air pollution control agency charged with
implementing the Federal Clean Air Act. In addition to criteria pollutants, AQMD also implements
numerous federal and state requirements related to the toxic air pollutants which can cause cancer or other
severe localized health effects. The State's Air Toxic Hot Spots Act, for example, requires facilities to
conduct health risk assessments and notify the neighboring communities if the health risk exceeds the
regulatory thresholds.
Pursuant to AQMD's requirements, the District must obtain permits before sewage treatment
improvement projects can be constructed and operated. Such permits are project specific and may contain
conditions that govern design criteria, operating parameters, and emissions standards. Most of the
District's treatment facilities are enclosed in order to capture and treat emissions to meet regulatory
emissions standards and to minimize odor impact to the neighboring communities. The District's
treatment plants are also subject to the requirements of Title V of the Federal Clean Air Act amendments.
The Title V permit is a single air quality permit for a facility that consolidates and replaces all of the air
permits for individual pieces of equipment previously issued by the local air quality district. The permit
contains all of the applicable local, state, and federal requirements, including periodic self-certification of
compliance and mandatory self-reporting of permit deviation.
All Title V permit related reporting and documents submitted to the AQMD must be signed by
the highest District official — in this case the General Manager. The Title V program also demands
facilities to organize and conduct extensive training of the staff involved, including the field operation and
maintenance staff. Another Title V important feature is a possibility of the public active participation and
intervention in the cases of potential emission limits and monitoring violations. The District Title V
permits did not receive any negative public responses or comments during the required public review
period. The District received initial Title V permits for both treatment plants in January 2009.
2009 Facilities Master Plan and Capital Improvement Program
The District's 2009 Facilities Master Plan(the "Master Plan")was completed and adopted by the
Board of Directors in December 2009 and has been updated from time to time. The Master Plan updated
the planning processes set forth in the 1989 Master Plan, the 1999 Strategic Plan, and the 2002 Interim
Strategic Plan Update. The Master Plan also incorporates and implements the levels of services defined
by the District's Board of Directors that are included in the District's 2009 Five-Year Strategic Plan. The
result is a plan that integrates research, facilities planning, water conservation and reclamation, sludge
reuse, other wastewater programs and financial planning into a single unified approach. A key
component of the Master Plan was the updating of flow projections and the collection system hydraulic
modeling. A capital improvement program was developed to implement the required sewer capacity and
rehabilitation improvements through the year 2030.
The District also annually reviews and validates its current Capital Improvement Program
("CIP"). The District expects to meet future demands on the Wastewater System through the CIP. This
program has been developed to satisfy anticipated regulatory requirements, increased population,
anticipated rehabilitations and replacements, additional treatment requirements, conservation, energy and
52224070.4 23
other resource savings considerations, odor control improvements, and air quality protection needs.
Through Fiscal Year 2030-31,the District's current CIP is scheduled to accomplish:
• Major rehabilitation of the existing headworks, primary treatment, secondary treatment,
outfall pumping, and solids handling facilities at both treatment plants;
• Replace and rehabilitate nine of the District's outlying pumping stations, and 26 trunk
sewer improvement projects;
• Reduce fence line odor to levels that do not generate odor complaints; and
• Achieve full secondary treatment standards.
The 2012 CIP Validation Study resulted in revisions to the CIP. The CIP currently consists of
146 individual capital projects through Fiscal Year 2030-31 with remaining outlays of$1.8 billion. Over
the next five years, the CIP contemplates average annual capital expenditures of$154 million based on
the 2012 CIP Validation Study. Implementation of full secondary treatment standards is scheduled to be
completed on or before December 31, 2012. Set forth in Table 5 below is a summary of total estimated
capital costs for the CIP for Fiscal Years 2012-13 through 2030-31.
Table 5
Capital Improvement Program—Estimated Capital Costs
Fiscal Years 2012-13 through 2030-31
Proi ect Cost
Collection System Capacity $ 167,629,000
Collection System Repair,Rehabilitation,Replacement 310,816,000
Treatment Plant Capacity 199,053,000
Additional Secondary Treatment 131,968,000
Improved Treatment 136,157,000
Treatment Plant Repair,Rehabilitation,Replacement 702,797,000
Support Facilities 121,390,000
Total Validated Capital Improvement Program 1,769,810,000
Source: 2011-12 Budget Update,Orange County Sanitation District.
The CIP included budgeted expenditures of$137.3 million in Fiscal Year 2012-13. The largest
cash outlay planned for plant facilities in Fiscal Year 2012-13 is $17.1 million for the Digester
Rehabilitation at Reclamation Plant No. 1 (total project cost is expected to be $57.2 million). Final
completion of this project anticipated in the Fall of 2012. The CIP's largest collection system project for
Fiscal Year 2012-13 is $5.6 million for the rehabilitation of the Newport Trunk Sewer and Force Mains,
which is currently in design.
Groundwater Replenishment System
The District has taken a multi jurisdictional approach to planning for capital facilities because
many of the methods for reducing or managing flows involve other jurisdictions. One such project is the
Groundwater Replenishment System ("GWRS"). In March 2001, the District entered into an agreement
with the OCWD to design and construct Phase 1 of the GWRS. The capital cost of this Phase was shared
equally (50% shares) by each agency. The GWRS is a joint effort by the two agencies to provide
reclaimed water for replenishment of the Orange County Groundwater Basin and to augment the seawater
52224070.4 24
intrusion barrier. Phase I of the GWRS became operational in January of 2008 with an expected water
production of 72,000 acre-feet per year once all secondary treatment facilities are online. In 2011, GWRS
produced approximately 68,000 acre-feet. The Phase II expansion started construction in November 2011
to add approximately 33,000 acre-feet per year. The District expects the Phase 11 expansion to be
completed in the fall of 2014. The Phase 11 expansion and all future phases will be funded solely by
OCWD. The District has committed 168,000 acre-feet per year of secondary effluent to these future
expanded operations. The District and OCWD amended their 2001 agreement in 2010 to provide OCWD
with the first right of refusal of secondary treated water flows from the District's Fountain Valley-based
Plant No. 1 for these future phases; however, no capital funding is anticipated or dedicated from the
District for these future expansion phases.
OCWD and the District have agreed to share equally in the cost of the Joint GWRS
Microfiltration Backwash Redirection Project which will increase the quantity of water available during
the early morning hours when the flows are low. This project will save the District operational costs in
the form of reduced primary treatment chemical usage. The District's total estimated budget for this
project is $1.1 million.
Preferred Level of Treatment
In July 2002, the Board of Directors approved a change from the existing level of treatment, a
blend of 50% advanced primary and 50% secondary treated wastewater, to full secondary treatment
standards. The reasoning behind the decision to move to full secondary standards included (1) the
possibility (no matter how remote) that bacteria from the ocean outfall may at times reach the shoreline,
(2) upgraded treatment will aid additional water reclamation with the OCWD, and (3) the clearly stated
public preference for upgrading wastewater treatment at the time. Following the determination by the
Board of Directors in July 2002 to implement full secondary standards, staff prepared the Secondary
Treatment NPDES Permit Application that was required to be submitted to the regional office of EPA and
the RWQCB in December 2002. An NPDES permit has been issued to the District and the District is
currently operating under the Consent Decree. See "THE DISTRICT — Permits, Licenses and Other
Regulations."
hi an effort to eliminate most bacteria from being released from the ocean outfall, in 2002 the
District began to use chlorine bleach to disinfect the effluent and then apply sodium bisulfate to remove
remaining chlorine prior to releasing the treated wastewater to the ocean. The District continues to take
measures to limit the chlorine residual to a very low level prior to release. This mode of disinfection is
expected to continue until the District's secondary treatment facilities become operational. Beginning in
Fiscal Year 2006-07, the addition of disinfection treatment required an annual outlay ranging from $5.3
million to $7.2 million for additional chemicals from the operating budget of the District.
The District estimates that the remaining secondary treatment capacity projects will be completed
by December 31, 2012 at a total cost of approximately $12.1 million. In the interim, the District will
operate the plants to maximize available secondary treatment and to reduce effluent biochemical oxygen
demand and suspended solid discharges below those currently allowed limits.
Biosolids Management
The District produces digested and dewatered biosolids for beneficial use. By 2013,the District's
biosolids production is anticipated to peak at approximately 788 tons per day (tpd) when new secondary
treatment processes are fully operational, and then is projected to decline to approximately 710 tpd by
2017 when the IRWD's solids processing facilities and the District's biosolids centrifuges commence
52224070.4 25
operations. The Fiscal Year 2012-13 budget for biosolids disposal is $20.4 million, and for Fiscal Year
2013-14 it is $21.4 million.
The District has a diversified biosolids management portfolio:
Contract(Minimum tons Current tons per day
Contractor Location Product per day and term) managed(approximate)
250 tpd— 10 years with two 250 TPD
Synagro Kern County,CA Compost five-year renewals,expires
12/27/26
0 tpd—10 years with two 125 TPD
Synagro La Paz County,AZ Compost five-year renewals,expires
12/27/26
Tule Ranch Yuma County,AZ Land application 0 tpd—Four(4)years 350 TPD
expires 12/31/2012
The District's contractors provide back-up biosolids management options in Arizona that include
compost, land application recycling and landfill disposal. Together, these options have the capacity to
manage more than ten times the District's daily biosolids production to ensure sustainable, consistent, and
reliable operations.
The District's Long-Range Biosolids Management Plan ("LRBMP") was approved by the Board
in December 2003. The goal of the LRBMP was to develop a sustainable, reliable, and economical
program for long-range biosolids management providing environmentally sound practices that meet the
stringent federal, state, and local regulatory requirements. As a result of the LRBMP recommendations,
two contracts were awarded. Synagro's existing biosolids management contract was amended in April
2004, committing 250 tons per day of biosolids to be composted at Synagro's South Kern Compost
Manufacturing Facility,which started operations in late 2006.
Under the 2011 Strategic Plan update, District staff is working with Orange County Waste &
Recycling to negotiate an agreement to allow for the use of local landfills for biosolids management
during our peak production period. Finalizing this agreement is the final step towards managing up to
12% of the District's annual biosolids production locally at a slightly lower cost than land application in
Arizona.
52224070.4 26
Urban Runoff
Recognizing that the beaches of Orange County were being affected by pollution carried by urban
runoff, the Board of Directors, adopted a number of resolutions agreeing to temporarily accept dry
weather urban runoff into the sewer system and established an aggregate 10 million gallons per day
("MGD") capacity limit for urban runoff flows. The current policy adopted March 28, 2001, Resolution
No. 01-07, declares that the District will initially waive fees and charges associated with authorized
discharges of dry weather urban runoff to the sewer system until the total volume of all runoff discharges
exceeds 4 MGD calculated on a monthly average, or until the District modifies this provision. In June
2002,Assembly Bill 1892 amended the District's charter to formally allow the diversion and management
of dry weather urban runoff flows.
There are currently 19 active urban runoff diversion structures, four owned and operated by the
County, 11 owned and operated by the City of Huntington Beach, one owned and operated by the City of
Newport Beach, two owned and operated by the IRWD, and one owned and operated by The Irvine
Company. The Dry Weather Urban Runoff Program is administered by the Environmental Compliance
Division which issues a discharge permit for each of the diversion structures. The permit functions as a
control mechanism that specifically prohibits storm runoff and authorizes discharge only during periods
of dry weather. The permit also establishes specific discharge limits, constituent monitoring, and flow
metering requirements. In addition, the District conducts quarterly sampling and analysis of the urban
runoff discharges to ensure discharge limit compliance for the various regulated constituents.
From January 1, 2011 through December 31, 2011, the daily average urban runoff flow ranged
between 0.588 and 3.31 MGD with a cumulative total of 685 million gallons for this period. The daily
average volume remained less than half of the 4 MGD fee threshold for eight months out of this twelve
month period. At the existing operations and maintenance cost of$1,311.79 per million gallons (2010-11
rate),the District's cost for treating the urban runoff discharge was $899,082. At both the 2010 and 2011
strategic plan workshops, the Board of Directors adopted a strategic plan initiative to implement full-cost
recovery for all urban runoff administrative and treatment costs starting in Fiscal Year 2013-2014. Based
on meetings with the member cities and other stakeholders on urban runoff, the Board Steering
Committee directed staff to bring back this issue to the Board of Directors as part of the 2012 strategic
planning process.
Integrated Emergency Response Program
hi recognition of the potential damage which could occur in the event of a major earthquake,
flood, or other disaster, the District implemented an Integrated Emergency Response Program (the
"IERP") in 1979. The IERP is a two-volume plan which contains policies, plans and procedures
preparing for, and responding to, emergencies. The District also analyzed disaster preparedness issues
and policies within the Master Plan, and within a 1994 document titled Fault Rupture Hazard
Investigation—Wastewater Treatment Plant No. 2.
The disaster preparedness plan included in the Master Plan reviewed two possible major
earthquake scenarios: an 8.3 Richter magnitude ("M") earthquake on the southern San Andreas fault
system and an M 7.0 earthquake on the Newport-Inglewood fault zone, which includes Plant No. 2. An
M 8.3 earthquake on the southern San Andreas fault, while on the whole more destructive than the M 7.0
Newport-Inglewood fault, may result in less damage to the District's service area due to the distance of
the fault from most of the service area. However, the Master Plan stated that damage from such a major
earthquake on the San Andreas fault would be extensive. Also, the Master Plan indicated that an M 7.0
earthquake on the Newport-Inglewood fault within five miles of the District's sewerage facilities could
cause major destruction to those facilities. The disaster preparedness plan in the Master Plan indicated
52224070.4 27
that it would not be economically feasible to upgrade all of the existing sanitary sewerage facilities to
survive an earthquake of this magnitude along the Newport-Inglewood fault. The IERP outlines the
policies and employee actions to be taken before, during and after an earthquake, earthquake response
guidelines and damage assessment procedures.
The Master Plan analyzed the vulnerability of the sanitary sewerage facilities and operations of
the District and planned a risk reduction program wherein the vulnerability of many of the District's
sanitary sewerage facilities to an earthquake could be reduced by recommended retrofit construction
measures. The Master Plan also recommended that designs of existing major structures which were
constructed prior to development of current seismic design standards be reviewed and the structures
strengthened,if necessary.
Since the Master Plan and the 1994 Report, the District has completed retrofitting where deemed
appropriate. Pursuant to the Master Plan, all recent and future projects have been, and will be, designed
to the same high earthquake code standards as set for other essential services, such as hospitals and fire
stations. Many of the older buildings analyzed in the Master Plan have been replaced by structures built
after 1989.
The Army Corps of Engineers' "All-River Plan" has mitigated any future flooding of the Santa
Ana River system and potential threats to the District's Wastewater System. Also, both Plant No. 1 and
Plant No. 2 are built to federal standards.
The disaster preparedness plan in the Strategic Plan investigates the damage potential posed by
coastal flooding, tsunamis (large ocean waves generated by seismic activity) and windstorms. No
assurance can be given that any such events would not have a material adverse impact on the Wastewater
System.
The Strategic Plan also makes recommendations regarding fire protection of the Wastewater
System. Most of the structures at Plant No. 1 and Plant No. 2 are constructed of fire-resistant materials.
The IERP describes the procedures needed to respond to a possible disaster. For more information
regarding emergency response policies, the disaster preparedness plan described in the Strategic Plan and
the IERP can be reviewed at the District's office.
Five-Year Strategic Planning
In November 2007, the Board of Directors adopted a new comprehensive strategic plan to steer
the District's efforts and engage the organization to envision service levels and operational needs for the
next five years. The Strategic Plan has been updated annually to continue looking at a five-year horizon
(each, a "Five-Year Plan"). Since 2007, approximately 79% percent of the strategic goals have been
completed. Following a similar process used in the prior year up the General Manager's Office initiated
the planning effort with the Executive Management Team, then solicited input and ideas from managers
and supervisors. In October 2011,the staff-generated ideas were presented at a workshop with the Board
of Directors where the Board Members discussed and deliberated changes and additions to the plan.
Driven by the District's Mission, Vision and Core Values, the 2012 Strategic Plan Update continues an
aggressive effort by the District to meet the sanitation, health, and safety needs of the approximately 2.5
million people served while protecting the environment where we all live. As a result of the discussion at
the October 2011,three new goals were added to the Strategic Plan, as follows:
• Development of an updated five-year rate schedule to go into effect July 1,2013.
52224070.4 28
• Development of a direct charging mechanism to recover the cost of urban runoff
treatment.
• Determining the cause of benthic community changes near the ocean outfall and taking
corrective action to return affected areas to normal conditions.
This Strategic Plan continues to chart a focused roadmap of success for the future of the District.
It addresses critical operations and construction issues, financial and budgeting challenges, and gives a
clear and concise direction to staff,ratepayers,regulatory agencies,and the general public.
DISTRICT REVENUES
Sewer Service Charges
General. The District has the power to establish fees and charges for services of the Wastewater
System. Such fees and charges are established by the District's Board of Directors and are not subject to
review or approval by any other agencies.
In Fiscal Year 1997-98, a Rate Advisory Committee (the "RAC") was established comprised of
representatives from industrial, commercial and residential users. The goal of the RAC was to examine
the then current rate structure and, if needed, develop recommendations for change. The RAC analyzed
the District's rate structure to determine whether its then current sewer service user fees (now known as
"Sewer Service Charges") were equitable among residential and industrial customers. This review
resulted in a proposal to expand the number of non-residential user categories from one to 23 and to
provide for gradual rate increases in seven of the nine Revenue Areas. The Sewer Service Charges for
those categories were based on the average flow and strength of wastewater discharged for each property
type and remain currently in use.
The Board of Directors establishes the annual sanitary sewer service charges by ordinance. The
sanitary sewer service charge ordinances are adopted by a two-thirds vote of the Board of Directors as
required under law after conducting a noticed public hearing in compliance with Proposition 218. See
"LIMITATIONS ON TAXES AND REVENUES — Article XIIIC and Article XIIID of the California
Constitution." In May 2002, the Board of Directors adopted District Ordinance No. OCSD 18 (the "2002
Ordinance") which became effective on July 1, 2002. The 2002 Ordinance included a single family
residential ("SFR") rate increase, the underlying basis for all sanitary sewer service charges including
sanitary sewer rates for multi-family residential units as well as most commercial and industrial
properties, of $7.50 per year, or 9.4%, to $87.50 per year. In June 2003, the Board of Directors
authorized a Proposition 218 notice on proposed"not to exceed"rate increases for each year over the next
five years.
The District collects Sewer Service Charges from property owners through the semi-annual
property tax bill distributed by the County throughout the District, except in Revenue Area No. 14.
Pursuant to the IRWD Agreement, the District receives quarterly fee payments from the IRWD which
directly collects fees from customers through a monthly billing procedure in Revenue Area No. 14.
The District currently participates in the County's Teeter Plan under which the District receives
annually 100% of the secured property tax levies to which it otherwise is entitled, regardless of whether
the County has actually collected the levies.
52224070.4 29
The District has covenanted in the Master Agreement to fix, prescribe and collect fees and
charges to satisfy certain coverage requirements as further described under "SECURITY AND
SOURCES OF PAYMENT FOR THE NOTES—Rate Covenant"herein.
Residential and Commercial Sewer Service Charges. Pursuant to the 2002 Ordinance, the
District established residential Sewer Service Charges, except within Revenue Area No. 14, based on the
cost of services and facilities provided to each customer of the District. The noticed public hearing held
in connection with the 2002 Ordinance considered increases in the amount of the annual charges of
approximately 20% per year for each of the then following five years. In May 2005, the Board of
Directors adopted Ordinance No. OCSD-26 increasing the Fiscal Year 2005-06 single family residential
rate, the underlying basis for all sewer service charges, by 31%, from $115.00 to $151.00 for all
ratepayers, except those located in Revenue Area No. 14. In June 2007, the Board of Directors adopted
Ordinance No. OCSD-32 increasing the Fiscal Year 2007-08 single family residential rate by 9.8%.
On February 27, 2008, the Board of Directors approved increases in its sanitary sewer service
charges for all single family and multi-family residential units, and for all commercial properties. The
Board increased the single family residential rate, which is the basis for all of the District's sewer service
charges,by 10.4% for Fiscal Year 2008-09, 10.0% for Fiscal Year 2009-10, 10.4% for Fiscal Year 2010-
11, 9.4%for Fiscal Year 2011-12 and 10.1%for Fiscal Year 2012-13.
Set forth in Table 6 below is a five-year comparison of the Sewer Service Charge rate for single
family residences.
Table 6
Annual Sewer Service Charges
Single Family Residence Rate
Five Year Rate Schedule
Fiscal Years 2008-09 through 2012-13
Sewer Service Percent
Fiscal Year Charge Increase
2008-09 $201.00 10.4%
2009-10 221.00 10.0
2010-11 244.00 10.4
2011-12 267.00 9.4
2012-13 294.00 10.1
Source: Orange County Sanitation District.
Set forth in Table 7 below are the total average annual Sewer Service Charges for single family
residences ("SFR") within the District, together with comparable total average annual charges for
wastewater service within the jurisdictions of certain other cities and districts within the State as of the
dates indicated. The District's projected SFR rate of $294 in Fiscal Year 2012-13 remains below the
average annual sewer rate of $406 according to a Fiscal Year 2007-08 survey of 726 agencies
encompassing all 58 counties in California conducted by the State Water Resources Control Board.
52224070.4 30
Table 7
Comparison of Total Sewer Service Charges
For Single-Family Residences
As of July 1,2011 (Sacramento as of October 1,2011)
Average Dry Annual
Weather Sewer
Flow Service Treatment Collection Property Tax
Enti m /d (3) Chame(i) Level(2)(3) Responsibiliby ) Income(3)
City of San Diego 168 $608 2 Yes No
City of Los Angeles 428 360 4 Yes No
East Bay MUD 80 288 4 No Yes
Sacramento 140 264 3 No Yes
Orange County 221 267 2 No Yes
Sanitation District
Los Angeles County 497 143 4 No Yes
Source: Information obtained from respective entities listed.
(2) Treatment Level Categories:
"1"—Primary treatment.
"2"—Advanced primary or primary with some secondary treatment.
"3"—Secondary treatment.
"4"—Advanced secondary or secondary with some tertiary treatment.
"5"—Tertiary treatment.
(3) Source: Wastewater User Charge Survey Report by the California State Water Resources Control Board.
Industrial Sewer Service Charges. The District charges industrial Sewer Service Charges to
customers discharging high-strength or high-volume wastes into the sewer systems. Customers subject to
industrial Sewer Service Charges are billed directly by the District. The fee charged to each customer is
based on the customer's sewage volume, the concentration of suspended solids and biochemical oxygen
demand. Pursuant to the 2002 Ordinance, rates for each component factor were revised for certain
industrial users in order to be consistent with the rates charged to residential users. Total industrial Sewer
Service Charges in Fiscal Year 2010-11 were approximately $10.1 million. Industrial Sewer Service
Charges are applied to both operating and capital funds.
The Sewer Service Charge increases described above are necessary to meet the District's cash
flow needs arising from the addition of disinfection treatment and other operating requirements. As
discussed under the caption "THE DISTRICT — 2009 Facilities Master Plan and Capital Improvement
Program," the 2012 CIP Validation Study developed the capital improvement program to ensure
secondary treatment standards are met as quickly as possible while providing for increased flows and
rehabilitation and refurbishment of existing facilities. As projected through Fiscal Year 2030-31, the cash
flow needs of the CIP total approximately $1.8 billion. Over the next five years the CIP contemplates
average annual capital expenditures of$187 million. This amount includes $770 million, or an average
annual capital outlay of$154 million, in accordance with the 2012 CIP Validation Study. In addition,the
CIP contemplates $164 million, or an annual average of $33 million, to finance projects currently
unknown or unidentified as forecasted by the District's Asset Management Program.
52224070.4 31
Additional Revenues
The District has several sources of additional revenue, including property taxes, Capital Facilities
Capacity Charges, capacity rights,permit and inspection fees and interest earnings.
Property Taxes. The District receives approximately 2.5% of the one percent County ad valorem
property tax levy, based on the allocation procedure under State law. Property tax revenues were $60.6
million in Fiscal Year 2006-07, $65.2 million in Fiscal Year 2007-08, $66.4 million in Fiscal Year 2008
09, $64.8 million in Fiscal Year 2009-10 and$64.3 million in Fiscal Year 2010-11. In Fiscal Years 2003-
04 and 2004-05 the State implemented a two-year 40% secured property tax shift away from independent
special districts due to the fiscal crisis occurring at that time. During the 2004-05 State Budget process,
the State Legislature and the Governor enacted Senate Bill 1096 and Assembly Bill 2115, effectively
shifting an additional $1.3 billion in local property tax revenues from counties, cities, special districts and
redevelopment agencies to schools and community colleges. See "LIMITATIONS ON TAXES AND
REVENUES—Proposition IA." Total assessed valuations increased in the 2005-06 Fiscal Year by 10.3%
over the 2004-05 Fiscal Year, and the full value of these increases was received on all non-secured
property tax distributions. The District received its full allotment of property tax revenues (no State
property tax shift)beginning in Fiscal Year 2006-07. See Table 14 below. The District currently projects
its property tax receipts to remain approximately level through Fiscal Year 2013-14. The apportionment
of the ad valorem tax is made pursuant to a revenue program adopted by the District in April 1979 to
comply with EPA and RWQCB mandates, legal and contractual requirements and Board of Director's
policy.
Capital Facilities Capacity Charges. Capital Facilities Capacity Charges (commonly referred to
as connection fees) are one-time fees with two components, paid at the time property is developed and
connected to the Wastewater System. The fees are imposed by the District pursuant to Section 5471 of
the California Health and Safety Code and are levied to pay a portion of the District's capital costs and for
access to capacity in the Wastewater System. The District currently has Capital Facilities Capacity
Charges of $3,341 per residential unit (three-bedroom); however, under the current industrial use
ordinance, additional Capital Facilities Capacity Charges can be imposed on industrial users who place
larger than average demand on the Wastewater System. Member cities and sanitary districts collect
Capital Facilities Capacity Charges for the District when building permits are issued. Capital Facilities
Capacity Charges are reviewed annually to reflect the changes in the value of the Wastewater System to
which a new customer is connecting.
On December 15, 1999, the Board of Directors approved District Ordinance No. OCSD 99-11
(the"1999 Ordinance")which established a comprehensive Capital Facilities Capacity Charge. The 1999
Ordinance, effective as of January 1, 2000, renamed connection fees as Capital Facilities Capacity
Charges and provided a more equitable schedule of fees among industrial, commercial and residential
users. Pursuant to the 1999 Ordinance, Capital Facilities Capacity Charges were revised for high demand
industrial users in five incremental increases from 1999 through 2001. For a summary of historical and
projected revenues derived from Capital Facilities Capacity Charges, see Table 14 and Table 15 below.
Pursuant to an agreement with the IRWD, the IRWD is not required to pay Capital Facilities
Capacity Charges and, in exchange, the IRWD provides funding to the District for the construction costs
of certain wastewater collection, transmission, treatment and disposal facilities to be used by the IRWD
and is obligated to make certain payments to the District for certain services arising from the Wastewater
System(including any standby or availability charges).
52224070.4 32
Sale of Capacity. The District has entered into agreements with the Santa Ana Watershed Project
Authority ("SAWPA") whereby wastewater from Upper Santa Ana River Basin dischargers can be
transported through the District's Santa Ana River Interceptor to the District's wastewater treatment
facilities. This program was developed in the early 1970s. The agreements establish control mechanisms
regarding the quality of wastes deposited into the Wastewater System. At the present time, SAWPA has
purchased and paid for 30 mg/d of maximum regulated flow capacity rights in the District's Santa Ana
River Interceptor and 17 mg/d of monthly average flow capacity in the District's wastewater treatment
plants. Projected revenues from SAWPA range from$4.5 million to $5.3 million over the next five years.
Additional treatment plant capacity can be purchased in increments at the District's current replacement
cost.
Federal Subsidy Payments. hi connection with the District's Revenue Obligations, Series 2010A
(the "2010A Certificates") and the District's Revenue Obligations, Series 2010C (the "2010C
Certificates"), issued as "Build America Bonds," the District will receive certain federal subsidy
payments of approximately $5.1 million annually through 2031 and lesser amounts thereafter until 2044.
Subsidy payments with respect to the 2010A Certificates and the 2010C Certificates will constitute
Revenues as defined in the Master Agreement. In its financial reports, the District accounts for subsidy
payments received in connection with the 2010A Certificates and the 2010C Certificates as a reduction in
interest expense with respect to such obligations.
Wastewater Treatment History
The wastewater flows for Fiscal Year 2006-07 through Fiscal Year 2010-11 were 229 mg/d, 221
mg/d, 211 mg/d, 196 mg/d and 207 mg/d, respectively. The highest flow rate experienced was during El
Nino storm periods. Peak flows of 500 mg/d were recorded in December 1997 and February 1998. There
were no sewer failures or overflows during these events.
Customers
The historical number of customers served by the District for the Fiscal Years 2007-08 through
2011-12 and the projected number of customers served by the District for the Fiscal Years 2012-13
through 2016-17, identified in Equivalent Dwelling Units ("EDUs"), are set forth in Table 8 and Table 9
below. As discussed below, sewer service charges are based on the expected amount of wastewater flow
for a single family dwelling. This base amount is considered the "equivalent dwelling unit." Set forth in
Table 8 below are the EDUs that equate to total Sewer Service Charge levies,while the EDUs set forth in
Table 9 equate to total sewer service charge collections.
52224070.4 33
Table 8
Historical and Projected Equivalent Dwelling Units
Fiscal Years 2006-07 through 2015-16
Historical Projected
Fiscal Year EDUs(0 Fiscal Year EDUs
2007-08 911,033 2012-13 926,928 (2)
2008-09 921,782 2013-14 929,430(3)
2009-10 930,164 2014-15 932,033 (3)
2010-11 924,622 2015-16 934,736(3)
2011-12 924,625 2016-17 937,493 (3)
(1) With respect to such Fiscal Years, presentation in the Statistical Section of the District's Comprehensive
Annual Financial Report set forth in Appendix A includes EDUs that equate to total Sewer Service Charge
collections rather than levies.
(2) EDUs projected in current budget as of June 2012.
(3) EDU growth during the projection period is estimated at approximately[2.6%to 2.9%]per annum.
Source: Orange County Sanitation District.
Set forth in Table 9 below are the number of residential and commercial customers and industrial
customers and the approximate percentages of Sewer Service Charge revenues derived from the
combined residential and commercial use and industrial use for the last five fiscal years.
Table 9
Number of Accounts and Revenues by Customer Class
for the Fiscal Years 2006-07 through 2010-11
($in Millions)
Residential/Commercial Industrial
Number of Percentage Percentage
Equivalent of Sewer of Sewer
Single- Service Number of Service
Family Total Charge Customer Total Charge
Fiscal Year Dwellings Revenue Revenues Accounts Revenue Revenues
2006-07 867,035 $143.8 91% 531 $13.4 9%
2007-08 875,739 159.4 93 520 12.1 7
2008-09 882,747 177.4 95 515 9.9 5
2009-10 875,442 193.5 95 487 10.8 5
2010-11 874,130 213.3 95 479 10.1 5
Source: Orange County Sanitation District.
52224070.4 34
Set forth in Table 10 below are the ten largest principal sewer service customers of the District
for the Fiscal Year ended June 30, 2011.
Table 10
Largest Principal Sewer Service Customers of the District
for the Fiscal Year Ended June 30,2011
Sewer Service
User Charges
Kimberly-Clark Worldwide, Inc. $ 1,533,243
MCP Foods, Inc. 1,036,648
Alstyle Apparel-A&G Inc. 909,188
Stremicks Heritage Foods,LLC 756,778
House Foods America Corp. 588,739
Pepsi-Cola Bottling Group 440,707
Jazz Semiconductor 344,671
Dean Foods Co. of CA Inc. 316,641
Schreiber Foods Inc. 298,157
Pulmuone Wildwood,Inc. 293,669
Total 6 518 441
Source: Orange County Sanitation District.
Assessed Valuation
The assessed valuation of property in the County is established by the County Assessor, except
for public utility property which is assessed by the State Board of Equalization. Due to changes in
assessment required under State Constitution Article XIIIA, the County assessment roll no longer
purports to be proportional to market value. See "LIMITATIONS ON TAXES AND REVENUES"
herein. Generally, property can be reappraised to market value only upon a change in ownership or
completion of new construction. The assessed value of property that has not incurred a change of
ownership or new construction must be adjusted annually to reflect inflation at a rate not to exceed 2%
per year based on the State consumer price index. In the event of declining property value caused by
substantial damage, destruction, economic or other factors, the assessed value must be reduced
temporarily to reflect market value. For the definition of full cash value and more information on
property tax limitations and adjustments, see"LIMITATIONS ON TAXES AND REVENUES"herein.
The County Assessor determines and enrolls a value for each parcel of taxable real property in the
County every year. The value review may result in a reduction in value. Taxpayers in the County also
may appeal the determination of the County Assessor with respect to the assessed value of their property.
52224070.4 35
Set forth in Table 11 below is a five-year history of assessed valuations in the District since Fiscal
Year 2007-08.
Table 11
Assessed Valuations of Property in the District
Fiscal Years 2007-08 through 2011-12
($in Billions)
Fiscal Year Value % Chan2e
2007-08 $292.7 8.14%
2008-09 307.6 5.08
2009-10 305.2 (0.98)
2010-11 304.3 (0.27)
2011-12 308.7 1.43
Source: County of Orange Auditor-Controller.
Tax Levies and Delinquencies
Property taxes are based on assessed valuation which is determined as described under
"DISTRICT REVENUES —Assessed Valuation"herein. In accordance with the California Revenue and
Taxation Code, the County tax collector collects secured tax levies for each Fiscal Year. Property taxes
on the secured roll are due in two installments, on November 1 and February 1. The District currently
participates in the County's Teeter Plan under which the District receives annually 100% of the secured
property tax levies and Sewer Service Charges to which it otherwise is entitled,regardless of whether the
County has actually collected the levies. This alternative method provides for funding each taxing entity
included in the Teeter Plan with its total secured property taxes during the year the taxes are levied,
including any amount uncollected at fiscal year-end. Under this plan, the District's general fund receives
the full amount of secured property taxes levied each year on its behalf and, for so long as such plan
remains in effect, the participating entities, such as the District, no longer experience delinquent taxes.
The County's general fund is the designated recipient of future collections of penalties and interest on all
delinquent taxes collected on behalf of participants in this alternative method of apportionment. In recent
years, the County has experienced delinquencies of Sewer Service Charges in the District of
approximately 2%.
52224070.4 36
Set forth in Table 12 below is a five-year history of the District's ad valorem total property tax
and Sewer Service Charge levies.
Table 12
Total Property Tax and Sewer Service Charge Levies
in the District for Fiscal Years 2007-08 through 2011-12
(In Thousands)
Total Tax and Sewer
Fiscal Year Service Charge Lew
2007-08 $228,622
2008-09 254,092
2009-10 272,050
2010-11 292,646
2011-12 315,186
Source: County of Orange Auditor-Controller.
Budgetary Process
The District's operating fund budget relies on revenues from Sewer Service Charges and property
taxes,both of which are collected on the property tax bill, as previously described under the captions "—
Sewer Service Charges" and " — Additional Revenues." The District receives tax revenues from the
County in eight allocations, with the largest receipts in December and April. The District operates on a
Fiscal Year beginning each July 1. The operating fund budgets include funds to cover the dry period of
each tax year, i.e., the period from the beginning of the Fiscal Year until the first taxes are received. The
dry-period requirement is budgeted at one-half of the annual operating fund budgeted expenditures. The
District uses the accrual method of accounting in its budgets. The District has conformed to its budgets
for the last five fiscal years and is conforming to its budget for the current fiscal year.
The District's annual budget preparation process begins in January of each year and concludes in
June upon its adoption. The General Manager reviews the final operating budgets and then distributes
them to the Directors and District Committees for consideration. The Board of Directors then adopts the
proposed annual budgets,with any revisions, in June of each year.
Budgetary control is exercised at the individual Department level and administrative policies
provide guidelines on budget transfers and the authorization necessary to implement transfers. A budget
adjustment is a transfer which does not change the total appropriated amount and does not require Board
of Directors action. Approval may be granted by the General Manager or the Department Head in certain
circumstances. Department Heads have the discretion to reapportion funds between certain line items
within a division but may not exceed total appropriated amounts for each department. They may also
transfer staff across divisional lines. The General Manager and Board of Directors must approve
additional capital outlay items.
A budget amendment is an adjustment to the total appropriated amount which was not included in
the original budget. These supplemental appropriations require formal action by the Board of Directors.
Prior year reserves or fund balances may be appropriated to fund items not previously included in the
adopted budget. Reserves or fund balances exceeding minimum amounts required by fiscal policies may
be appropriated if it is determined to be in the best interest of the District. Directors may also appropriate
reserves in case of emergencies or unusual circumstances.
52224070.4 37
Reserves
The District has an established reserve policy with eight separate categories for its reserve funds.
Collectively, these individual reserve requirements total over $458 million for each year of the current
ten-year cash flow forecast. In Fiscal Year 2009-10, Financial Management staff and the Board of
Directors concluded that given the nature of the likely events that may cause a withdrawal from the
District's reserves and the degree of overlap among reserve categories,the total amount reserved need not
equal the sum of each separate reserve category. As a result, the District adjusted the application of its
reserve policy, leading to a reduction of$40 million of the accumulated total, or approximately 8 percent.
Reserve levels are calculated in accordance with the District's reserve policy. Set forth in Table 13 below
are the actual reserves at June 30, 2009, June 30, 2010 and June 30, 2011 and the District's projected
reserves at June 30,2012,for each fund.
Table 13
Cash Reserves
June 30,2009 through 2011
Unaudited June 30,2012
(In Millions)
Actual Unaudited
2009 2010 2011 2012
June 30 June 30 June 30 June 30
Cash Flow Requirements Reserve—
Operating Expenses $ 73 $ 78 $ 75 $ 76
Certificates of Participation Payments 84 92 97 92
Operating Contingencies Reserve 15 15 15 15
Capital Improvement Program Reserve 116 86 118 171
Catastrophe and Self Insurance 58 57 57 57
Capital Replacement and Refurbishment 55 56 57 59
Debt Service Required Reserves(i) 133 129 142 138
Overlapping Reserve Adjustment - A40) - -
Total 534 473 561 608
' "Debt Service Required Reserves" constitute all amounts held in Obligation Reserve Funds, together with
additional amounts held by the District that may be used for the payment of debt service on District obligations
in accordance with the District's reserve policy. As of June 30, 2011, $138 million of Debt Service Required
Reserves were held in Obligation Reserve Funds,of which$63.4 million is restricted by covenant for the specific
obligations for which such Obligation Reserve Funds were established.
Source: Orange County Sanitation District.
52224070.4 38
The District has the following reserves:
( The Cash Flow Requirements Reserve was established to fund operation, maintenance and
certificates of participation debt service expenses for the first half of the fiscal year, prior to the
receipt of the first installment of the property tax allocation and sewer service user fees which are
collected as a separate line item on the property tax bill. The level of this reserve is established as
the sum of an amount equal to six months operations and maintenance expense and the total of
certificates of participation debt service expenses due in the subsequent fiscal year.
( The Operating Contingencies Reserve was established to provide for non-recurring expenditures
that were not anticipated when the annual budget and Sewer Service Charges were adopted. The
level of this reserve is equal to 10%of the District's annual operating budget.
( The Capital Improvement Program Reserve was established to fund annual increments of the
Capital Improvement Program with a target level at one-half of the average annual Capital
Improvement Program through the year 2020. Levels higher and lower than the target can be
expected while the long-term financing and capital improvement programs are being finalized.
( The Catastrophic Loss, or Self-Insurance Reserve is established for property damage including
fire, flood and earthquake, general liability and workers' compensation. The level of reserve in
this fund is maintained at a level to fund the District's non-reimbursed costs which are estimated
to be $57 million.
( The Capital Replacement and Refurbishment Reserve was established to provide 30% of the
funding to replace or refurbish the current collection, treatment and disposal facilities. The
current replacement value of these facilities is estimated to be approximately $6.26 billion. The
initial reserve level for this fund was established at $50 million and is augmented by interest
earnings and a portion of the annual Sewer Service Charges.
( Debt Service Required Reserves include trustee-held amounts in any Obligation Reserve Fund
and additional amounts held by the District for the payment of debt service in accordance with the
District's reserve policy. The District's current policy is to maintain reserves (including trustee-
held reserves) for debt service in the amount of 10% of the principal amount of the District's
outstanding debt obligations.
( The Rate Stabilization Reserve accumulates all available funds which exceed the targets for all
other reserves. The Rate Stabilization Reserve is a separate fund from the Rate Stabilization
Account established under the Trust Agreement. There is currently no established target for this
reserve and,because the reserves of all other funds have not been exceeded, the reserve level for
this reserve fund is zero for Fiscal Year 2011-12.
Summary of Operating Data
Set forth in Table 14 below is a summary of historic operating results for the District for Fiscal
Years 2007-08 through Fiscal Year 2010-11 and the unaudited operating results for Fiscal Year 2011-12.
The information presented in the summary should be read in conjunction with the financial statements
and notes. See APPENDIX A — "COMPREHENSIVE ANNUAL FINANCIAL REPORT OF THE
ORANGE COUNTY SANITATION DISTRICT FOR FISCAL YEAR ENDED JUKE 30, 201 L"
52224070.4 39
Table 14
Summary of Historical District Revenues and Expenses
and Other Financial Information
For Fiscal Years 2007-08 through 2010-11 and
Unaudited for Fiscal Year 2011-12
($in Millions)
Audited Unaudited
2007-08 2008-09 2009-10 2010-11 2011-12
Revenues:
Residential&Commercial
Sewer Service Charges(l)
Regional $159.4 $177.4 $193.5 $213.3 $233.4
Local - 5.6 5.6 5.7 5.8
Industrial Sewer Service Charges 12.1 9.9 10.8 10.1 9.5
Revenue Area No. 14 Fees 7.1 10.3 10.2 11.7 9.5
Ad Valorem Taxes 65.2 66.4 64.8 64.3 67.9
Interest Earnings 20.2 14.8 19.2 10.1 15.7
Other Revenues 6.9 5.8 12.5 5.8 6.2
Total Revenues $270.9 $290.2 $316.6 $321.0 $348.0
Operations and Maintenance
Expenses(2) 131.9 164.6(3) 138.1 138.9 137.8
Net Revenues 139.0 125.E $178.5 &l82.1 $210.2
Debt Service $42.8 57.6 77.3 83.6 75.6
Coverage Ratios 3.25x 2.18x 2.31x 2.18x 2.78x
CIP Outlay $259.4 $290.1 $251.1 160.7 77.2
Ending Reserves S425.0 MIA 1344.0 419.0 1608.2
Net of rebates, if any, to commercial users. Local sewer service fees were not established until Fiscal Year
2008-09.
(2) Excludes depreciation and amortization expenses.
(3) During the Fiscal Year ended June 30,2009,independent agreed-upon procedures were conducted on Revenue
Area 14 to substantiate the IRWD's owner equity interest in the District. As a result, a one-time other
operating expense of$29 million was charged to the Consolidated Revenue Area for the year ended June 30,
2009.
Source: Orange County Sanitation District.
52224070.4 40
Projected Operating Data
Set forth in Table 15 below are projected operating results for the District for Fiscal Years 2012-
13 through 2016-17. These projections assume the number of projects and scheduled build out set forth
in the 2011 CIP Validation Study, and reflect the Board-approved rate increase of 10.1% in Fiscal Year
2012-13, the last Fiscal Year of the District's approved rate schedule. For planning purposes, the
following four years thereafter reflect projected rate increases of 4.0% for each year. Principal
expenditure components of these projections are derived from the 2012 CIP Validation Study, which
identified 146 individual capital projects with a 20-year projected outlay of$1.8 billion. Much of the
construction is scheduled during the next five years, with average annual capital outlays of$187 million.
The District's CIP cash flow outlay for Fiscal Year 2011-12 was approximately $77.2 million. The
District's CIP cash flow budget for Fiscal Year 2012-13 is $137.3 million. This CIP budget finances joint
works treatment and disposal system improvement projects, and collection system improvement projects.
The preparation of such projections was based upon certain assumptions and certain forecasts with respect
to conditions that may occur in the future. While the District believes that these assumptions and
forecasts are reasonable for the purposes of the projected selected operating data, it makes no
representation that they will in fact occur. To the extent that actual future conditions differ from those
assumed herein,the data will vary.
[Remainder of page intentionally left blank.]
52224070.4 41
Table 15
Summary of Projected District Revenues and Expenses
and Other Financial Information
for Fiscal Years 2012-13 through 2016-17
($in Millions)(�)
2012-13 2013-14 2014-15 2015-16 2016-17
Revenues
Residential&Commercial
Sewer Service Charges $ 266.6 $ 282.2 $ 294.4 $ 307.2 $ 320.5
Industrial Sewer Service Charges 10.5 10.9 11.4 11.8 12.3
IRWD Assessments 14.6 14.9 16.0 16.2 11.4
SAWPA Assessments 4.5 4.7 4.9 5.1 5.3
Ad Valorem Taxes 64.0 64.0 67.2 70.6 74.1
Interest Earnings 12.1 14.8 17.1 16.6 15.7
Other Revenues 1.1 1.0 1.6 1.6 1.6
Total Revenues 373.4 392.5 412.6 429.1 440.9
Add: Build America Bonds
Federal Subsidy 5.1 5.1 5.1 5.1 5.1
Operations and Maintenance Expenses (151.6) (155.8) (164.7) (172.7) (177.3)
Net Revenues(1) $ 226.9 $ 241.8 $ 253.0 $ 261.5 268.7
Debt Service $ 82.6 $ 97.6 $ 84.9 $ 85.3 $ 90.1
Build America Bonds Federal Subsidy 5.1 5.1 5.1 5.1 5.1
Gross Debt Service $ 87.7 $ 102.7 $ 90.0 $ 90.4 $ 95.2
Coverage Ratios(i) 2.59x 2.35x 2.81x 2.89x 2.82x
CIP Outlays $ 137.3 $ 174.4 $ 189.6 $ 194.4 $ 238.6
Debt Proceeds $ - $ - $ - - -
Ending Reserves $ 613.6 $ 586.2 $ 568.1 $ 554.2 $ 507.7
Calculated in accordance with the Master Agreement and the Installment Purchase Agreement.
(2) Assumptions:
a) Annual growth in EDUs is projected to increase 0.25%over the next five years.
b) The Residential and Commercial Sewer Service Charge and the Industrial Sewer Service Charges are forecasts are based
on the total projected equivalent dwelling units,and the actual board approved annual rate increase in Fiscal Year 2012-
13 of 10.1%. The following four years thereafter reflect rate increases projected at 4.0%for each year.
c) Revenue Area No. 14 Fees are derived based on the projected contribution of sewage flows to the District from the
IRWD.
d) Ad Valorem Taxes are projected to remain level through Fiscal Year 2013-14,with 5%annual increases thereafter.
e) Interest earnings are projected to average 2.5%of annual cash balances.
f) Operating and Maintenance Expenses are forecasted with a base increase of 5.0%per year with adjustments for known
periodic outlays that do not occur annually.
g) Annual CIP Outlays are based on the cash flow projections developed from the 2012 CIP Validation Study.
Source: Orange County Sanitation District.
52224070.4 42
Management's Discussion and Analysis of Operating Data
The District's Fiscal Year 2012-13 total operating, capital improvement, debt service, and other
financing requirement budget is $377.8 million, a 6.9 percent decrease over the prior year budget of
$405.7 million. The decrease in the Fiscal Year 2012-13 budget is primarily due to the timing of the
construction schedules on the implementation of CIP validated capital projects of $1.3 billion over the
next ten years. The District's Fiscal Year 2012-13 budget includes $137.3 million in capital improvement
outlays as the District moves towards reaching secondary treatment standards by the target date of
December 31, 2012, as specified by the Board of Directors' July 2002 resolution and in keeping with the
terms and conditions of its ocean discharge permit and related Consent Decree.
The Fiscal Year 2012-13 operations budget for the collection, treatment, and disposal of
wastewater is $151.6 million, a decrease of $0.9 million or less than one percent from the prior year
budget of$152.5 million. Although individual expense categories will increase or decrease slightly, the
overall decrease to the operating budget is primarily attributable to a decrease in personnel costs of$3.3
million, or 3.4 percent, due to the retirement of many long-term employees and the time it takes to refill
these vacant positions (25 retirees in Fiscal Year 2011-12 and 35 retirees in Fiscal Year 2010-11). As of
March 31, 2012, there were 56 full-time equivalent ("FTE") vacant positions, or 8.8 percent of total
staffing. In addition, staffing levels were decreased from the Fiscal Year 2011-12 approved full-time
equivalent positions of 637 to 627.5 or a reduction of 9.5 FTE positions. Disinfection chemicals are
proposed to decrease $2.4 million,or 67.1 percent,due to the decrease in the usage of bleach to chlorinate
or disinfect the outfall effluent at Plant No. 2 and in sodium bisulfite, used to de-chlorinate this same
effluent. These reductions are due to the completion of the new trickling filters at Plant No. 2. These new
facilities reduce the amount of bacteria in the effluent requiring less disinfection. Utility costs are
proposed to decrease by $1.4 million, $1.1 million in electricity and $0.3 million in natural gas.
Electricity has been reduced due to summer peak shavings that has reduced usage as well as the lower
than expected increase in electrical rates. The demand for natural gas has been reduced due to tighter air
emission requirements requiring the District to use more electricity instead to supplement the digester gas
used to operate the central generation facilities. The repairs and maintenance budget has been reduced by
$1.2 million due to newer plant facilities requiring less immediate maintenance. Conversely affecting
these operating decreases, overhead cost allocation to the operating budget has increased by $6.7 million,
or 27.4 percent due to the decrease in budgeted capital outlay in Fiscal Year 2012-13. In addition, solids
removal has increased $1.9 million, or 10.1 percent, due to the increase in the average unit cost for the
removal of solids.
In preparation of the Fiscal Year 2012-14 biennium budget,District staff developed and reviewed
with the Board of Directors a capital improvement program to deliver the levels of service included in the
District's five-year strategic plan. These levels of services and associated capital projects are included in
the District's Five-Year Strategic Plan. In addition, District staff validated the active CIP projects
currently being executed to ensure that the scope of work on the active projects remains appropriate, and
that the cost estimates have been accurately updated. The Fiscal Year 2012-13 CIP cash flow budget was
approved at $137.3 million. This incorporation of the 2009 Facilities Master Plan(the"Master Plan")into
the CIP includes the addition of 65 new CIP projects totaling$615.7 million through the year 2050. The
2012 validated CIP includes 91 large capital projects and 55 special projects with total outlays of$1.8
billion through the year 2030. Over this period,the CIP is expected to accomplish:
Completion of the final Consent Decree Project of Secondary Treatment Expansion;
Construction of two large biosolids projects;
52224070.4 43
( Completion of planning studies to develop capacity, condition, level of service; business
opportunity based on CIP projects; and
( Optimization of the production of "power" and "biosolids" at each of the treatment
plants.
The completion of the CIP Validation Study in 2009 reaffirmed the need for rate increases in
fixture years. Based on the results of the CIP Validation Study and the Five-Year Plan, the Board of
Directors adopted Ordinance No. OCSD-35, increasing the sanitary sewer service charges by
approximately 10 percent each year for a five-year period beginning in Fiscal Year 2008-09. These rate
increases were approved by a vote of two-thirds of the members of the Board of Directors and are not
subject to reaffirmation in any of the fixture fiscal years covered by this five-year period. This action
increased the single family residence user rate, the basis for all sewer user fee rates, from $267 in Fiscal
Year 2011-12 to $294 in Fiscal Year 2012-13, the last year of the five-year approved rate increases. See
"DISTRICT REVENUES—Sewer Service Charges."
Investment of District Funds
State statutes authorize the District to invest in obligations of the United States Government, state
and local governmental agencies, negotiable certificates of deposits, bankers acceptances, commercial
paper, reverse repurchase agreements and a variety of other investment instruments which are allowable
under California Government Code Section 53600 et seq.
All District funds, except for Obligation Reserve Funds controlled by a bank trustee pursuant to
the provisions of Existing Senior Obligations, are managed by an external money manager, Pacific
Investment Management Company. Mellon Trust serves as the District's independent custodian bank for
its investment program. Callan Associates serves as the District's independent advisor.
As of June 30, 2012, the District's externally managed fund consisted of a short-term investment
portfolio of$54.8 million with an average maturity of 91 days, and a long-term investment portfolio of
$431.2 million with average maturities of 3.0 years. Investments consist of United States government
securities, corporate bonds and commercial paper. The District's portfolio contains no structured
investment vehicles("SIVs") or reverse repurchase agreements.
Deposits in banks are maintained in financial institutions which provide deposit protection on the
bank balance from the Federal Deposit Insurance Corporation. The California Government Code requires
State banks and savings and loans to secure local government deposits by pledging government securities
equal to 110% of the deposits or by pledging first trust deed mortgage notes equal to 150% of the
deposits.
The District's Investment Policy requires that the District invest public funds in a manner which
ensures the safety and preservation of capital while meeting reasonable anticipated operating expenditure
needs, achieving a reasonable rate of return and conforming to all state and local statutes governing the
investment of public funds. The primary objectives, in order, of the District's investment activities are
safety,liquidity and return on investment.
52224070.4 44
FINANCIAL OBLIGATIONS
Existing Indebtedness
Currently, the District has Senior Obligations Outstanding payable on a parity with the Notes.
The table below describes the District's outstanding parity certificates of participation as of October 1,
2012. The payment obligations in connection with each series of these certificates of participation
constitute Senior Obligations, subject to the provisions of the Master Agreement and shall be afforded all
of the benefits, interests and security afforded Senior Obligations pursuant to the Master Agreement. The
District has no general obligation bonds or subordinate bonds outstanding.
Table 16
Outstanding Senior Obligations
As of October 1,2012
Original Principal Issue Outstanding Final
Amount Date Balance Maturi
2007A Certificates $ 95,180,000 05/22/07 $ 92,845,000 02/01/30
2007B Certificates 300,000,000 12/20/07 279,250,000 02/01/37
2008A Certificates 77,165,000 05/29/08 19,195,000 08/01/13
2008B Certificates 27,800,000 09/11/08 26,075,000 08/01/16
2009A Certificates 200,000,000 05/07/09 191,265,000 02/01/39
2010A Certificates 80,000,000 05/18/10 80,000,000 02/01/40
2010C Certificates 157,000,000 11/29/10 157,000,000 02/01/44
2011A Certificates 147,595,000 10/03/11 140,195,000 02/01/26
2011B Certificates 143,205,000 11/10/11 143,205,000(l) 11/09/12()
2012A Certificates 100,645,000 03/22/12 100,645,000 02/01/33
2012B Certificates 66,395,000 08/16/12 66,395,000 02/01/26
Total Senior Obligations 1,394,985,000 1,296,070,000
To be paid with the sale proceeds of the Notes and other sources of funds. See"PLAN OF FINANCE."
In connection with the execution and delivery of the above-referenced outstanding certificates of
participation, the District entered into certain installment purchase agreements, or equivalent documents,
providing for the payment of installment payments or similar payments.
Anticipated Financings
From time to time the District may incur other obligations to finance portions of the CIP. Over
the next ten years,however, the District does not expect to issue any additional debt, other than refunding
debt. The District expects to refund outstanding obligations from time to time, such as the Prior Notes
discussed in Table 16 above.
52224070.4 45
Direct and Overlapping Bonded Debt
The aggregate direct and overlapping bonded debt of the District as of June 30, 2011 is set forth
on page 54 of Appendix B.
THE CORPORATION
The Corporation was organized on June 19, 2000 as a nonprofit public benefit corporation
pursuant to the Nonprofit Public Corporation law of the State. The Corporation's purpose is to render
assistance to the District in its acquisition of equipment, real property and improvements on behalf of the
District. Under its articles of incorporation, the Corporation has all powers conferred upon nonprofit
public benefit corporations by the laws of the State, provided that it will not engage in any activity other
than that which is necessary or convenient for, or incidental to the purposes for which it was formed.
The Corporation is a separate legal entity from the District. It is governed by a twenty-five
member Board of Directors. The Corporation has no employees. All staff work is performed by
employees of the District. The members of the Corporation's Board of Directors are the Board of
Directors of the District.
The District's Director of Finance and Administrative Services and other District employees are
available to provide staff support to the Corporation.
The Corporation has not entered into any material financing arrangements other than those
referred to in this Official Statement. Further information concerning the Corporation may be obtained
from the Orange County Sanitation District office at 10844 Ellis Avenue, Fountain Valley, California,
92708-7018.
LIMITATIONS ON TAXES AND REVENUES
Article XIIIA of the California Constitution
On June 6, 1978, California voters approved Proposition 13 ("Proposition 13"), which added
Article X111A to the State Constitution ("Article XIIIA"). Article XIIIA, as amended, limits the amount
of any ad valorem tax on real property to one percent of the full cash value thereof, except that additional
ad valorem taxes may be levied to pay debt service on (i)indebtedness approved by the voters prior to
July 1, 1978, (ii) (as a result of an amendment to Article XIIIA approved by State voters on June 3, 1986)
on bonded indebtedness for the acquisition or improvement of real property which has been approved on
or after July 1, 1978 by two-third of the voters on such indebtedness, and (iii)bonded indebtedness
incurred by a school district or community college district for the construction, reconstruction,
rehabilitation or replacement of school facilities or the acquisition or lease of real property for school
facilities, approved by 55% of the voters of the district, but only if certain accountability measures are
included in the proposition. Article X111A defines full cash value to mean "the county assessor's
valuation of real property as shown on the 1975-76 tax bill under "full cash value," or thereafter, the
appraised value of real property when purchased, newly constructed, or a change in ownership has
occurred after the 1975 assessment." The full cash value may be adjusted annually to reflect inflation at a
rate not to exceed 2%per year or to reflect a reduction in the consumer price index or comparable data for
the area under the taxing jurisdiction, or reduced in the event of declining property values caused by
substantial damage, destruction, or other factors. Legislation enacted by the State Legislature to
implement Article XIIIA provides that notwithstanding any other law, local agencies may not levy any ad
valorem property tax except to pay debt service on indebtedness approved by the voters as described
above.
52224070.4 46
Legislation Implementing Article XIIIA
Legislation has been enacted and amended a number of times since 1978 to implement Article
XIIIA. Under current law,local agencies are no longer permitted to levy directly any property tax(except
to pay voter-approved indebtedness). The one percent property tax is automatically levied by the County
and distributed according to a formula among taxing agencies. The formula apportions the tax roughly in
proportion to the relative shares of taxes levied prior to 1989.
Increases of assessed valuation resulting from reappraisals of property due to new construction,
change in ownership or from the 2% annual adjustment are allocated among the various jurisdictions in
the "taxing area" based upon their respective "situs." Any such allocation made to a local agency
continues as part of its allocation in future years.
Beginning in the 1981-82 fiscal year, assessors in the State no longer record property values on
tax rolls at the assessed value of 25% of market value which was expressed as $4 per$100 assessed value.
All taxable property is now shown at full market value on the tax rolls. Consequently, the tax rate is
expressed as $1 per $100 of taxable value. All taxable property value included in this Official Statement
is shown at 100% of market value (unless noted differently) and all tax rates reflect the $1 per $100 of
taxable value.
Article XIIIB of the California Constitution
An initiative to amend the State Constitution entitled"Limitation of Government Appropriations"
was approved on September 6, 1979, thereby adding Article XIIIB to the State Constitution ("Article
XIIIB"). Under Article XIIIB,the State and each local governmental entity has an annual"appropriations
limit" and is not permitted to spend certain moneys that are called "appropriations subject to limitation"
(consisting of tax revenues, state subventions and certain other funds) in an amount higher than the
appropriations limit. Article X111B does not affect the appropriations of moneys that are excluded from
the definition of"appropriations subject to limitation," including debt service on indebtedness existing or
authorized as of January 1, 1979, or bonded indebtedness subsequently approved by the voters. In
general terms, the appropriations limit is to be based on certain 1978-79 expenditures, and is to be
adjusted annually to reflect changes in consumer prices, populations, and services provided by these
entities. Among other provisions of Article XIIIB, if these entities' revenues in any year exceed the
amounts permitted to be spent,the excess would have to be returned by revising tax rates or fee schedules
over the subsequent two years.
"Appropriations subject to limitation" are authorizations to spend "proceeds of taxes," which
consist of tax revenues, state subventions and certain other funds, including proceeds from regulatory
licenses, user charges or other fees to the extent that such proceeds exceed"the cost reasonably borne by
such entity in providing the regulation, product or service,"but "proceeds of taxes" excludes tax refunds
and some benefit payments such as unemployment insurance. No limit is imposed on appropriations of
funds which are not "proceeds of taxes," such as reasonable user charges or fees, and certain other non-
tax funds.
Not included in the Article XIIIB limit are appropriations for the debt service costs of bonds
existing or authorized by January 1, 1979, or subsequently authorized by the voters, appropriations
required to comply with mandates of courts or the federal government and appropriations for qualified
capital outlay projects. The appropriations limit may also be exceeded in certain cases of emergency.
The appropriations limit for the District in each year is based on the District's limit for the prior
year, adjusted annually for changes in the cost of living and changes in population, and adjusted, where
52224070.4 47
applicable, for transfer of financial responsibility of providing services to or from another unit of
government. The change in the cost of living is, at the District's option, either(1) the percentage change
in State per capita personal income, or (2) the percentage change in the local assessment roll on
nonresidential property. Either test is likely to be greater than the change in the cost of living index,
which was used prior to Proposition 111. Change in population is to be measured either within the
jurisdiction of the District or the County as a whole.
As amended by Proposition 111, the appropriations limit is tested over consecutive two-year
periods. Any excess of the aggregate "proceeds of taxes" received by a District over such two-year
period above the combined appropriations limits for those two years is to be returned to taxpayers by
reductions in tax rates or fee schedules over the subsequent two years. As originally enacted in 1979,the
District's appropriations limit was based on 1978-79 authorizations to expend proceeds of taxes and was
adjusted annually to reflect changes in cost of living and population (using different definitions, which
were modified by Proposition 111). Starting with Fiscal Year 1990-91,the District's appropriations limit
was recalculated by taking the actual Fiscal Year 1986-87 limit, and applying the annual adjustments as if
Proposition III had been in effect. The District does not anticipate that any such appropriations
limitations will impair its ability to make Installment Payments as required by the Installment Purchase
Agreement.
Proposition IA and Proposition 22
Proposition IA ("Proposition lA"), proposed by the Legislature in connection with the 2004-05
Budget Act and approved by the voters in November 2004, restricts State authority to reduce major local
tax revenues such as the tax shifts permitted to take place in Fiscal Years 2004-05 and 2005-06.
Proposition IA provides that the State may not reduce any local sales tax rate, limit existing local
government authority to levy a sales tax rate or change the allocation of local sales tax revenues, subject
to certain exceptions. Proposition I generally prohibits the State from shifting to schools or community
colleges any share of property tax revenues allocated to local governments for any fiscal year, as set forth
under the laws in effect as of November 3, 2004. Any change in the allocation of property tax revenues
among local governments within a county must be approved by two-thirds of both houses of the
Legislature.
Proposition lA provides, however, that beginning in Fiscal Year 2008-09, the State may shift to
schools and community colleges up to 8%of local government property tax revenues,which amount must
be repaid, with interest, within three years, if the Governor proclaims that the shift is needed due to a
severe state financial hardship, the shift is approved by two-thirds of both houses and certain other
conditions are met. Such a shift may not occur more than twice in any ten-year period. The State may
also approve voluntary exchanges of local sales tax and property tax revenues among local governments
within a county.
Proposition lA was generally superseded by the passage of a new initiative constitutional
amendment at the November 2010 election, known as Proposition 22 ("Proposition 22"). The effect of
Proposition 22 is to prohibit the State, even during a period of severe fiscal hardship, from delaying the
distribution of tax revenues for transportation, redevelopment, or local government projects and services.
It prevents the State from redirecting redevelopment agency property tax increment to any other local
government or from temporarily shifting property taxes from cities, counties and special districts to
schools. This is intended to, among other things, stabilize local government revenue sources by restricting
the State's control over local property taxes.
Prior to the passage of Proposition 22, the State invoked Proposition lA to divert $1.935 billion
in local property tax revenues in fiscal year 2009-10 from cities, counties, and special districts to the State
52224070.4 48
to offset State general fund spending for education and other programs. Approximately $5 million of the
District's property tax revenues were diverted to the State as a result of this Proposition lA suspension.
The District participated in a Proposition lA Securitization Program (the "Program") sponsored by the
California Statewide Communities Development Authority. The Program allowed the District to
exchange its anticipated State property tax receivable for an equal amount of cash. In addition,the State's
adopted 2009-10 budget included a $1.7 billion diversion in local property tax revenues from local
redevelopment agencies. Many California Redevelopment Association members are actively engaged in
litigation to block such diversion and recoup certain payments already made under certain legislation
passed in July 2009 that is beyond the reach of Proposition 22,known as"ABX4 26."
Proposition lA also provides that if the State reduces the vehicle license fee ("VLF") rate
currently in effect, 0.65% of vehicle value, the State must provide local governments with equal
replacement revenues. Further, Proposition IA requires the State to suspend State mandates affecting
cities, counties and special districts, excepting mandates relating to employee rights, schools or
community colleges, in any year that the State does not fully reimburse local governments for their costs
to comply with such mandates.
Article XIIIC and Article XIIID of the California Constitution
Proposition 218, a State ballot initiative known as the "Right to Vote on Taxes Act," was
approved by the voters on November 5, 1996. The initiative added Articles XIIIC and XIIID to the
California Constitution, creating additional requirements for the imposition by most local governments of
"general taxes," "special taxes,""assessments," "fees," and"charges." Proposition 218 became effective,
pursuant to its terms, as of November 6, 1996, although compliance with some of its provisions was
deferred until July 1, 1997, and certain of its provisions purport to apply to any tax imposed for general
governmental purposes (i.e., "general taxes") imposed, extended or increased on or after January 1, 1995
and prior to November 6, 1996.
Article XIIID imposes substantive and procedural requirements on the imposition, extension or
increase of any"fee" or "charge" subject to its provisions. A "fee" or "charge" subject to Article XIIID
includes any levy, other than an ad valorem tax, special tax or assessment, imposed by an agency upon a
parcel or upon a person as an incident of property ownership. Article XIIID prohibits, among other
things, the imposition of any proposed fee or charge, and, possibly, the increase of any existing fee or
charge, in the event written protests against the proposed fee or charge are presented at a required public
hearing on the fee or charge by a majority of owners of the parcels upon which the fee or charge is to be
imposed. Except for fees and charges for water, sewer and refuse collection services, the approval of a
majority of the property owners subject to the fee or charge, or at the option of the agency,by a two-thirds
vote of the electorate residing in the affected area, is required within 45 days following the public hearing
on any such proposed new or increased fee or charge. The California Supreme Court decisions in
Richmond v. Shasta Community Services District, 32 Ca1.4th 409 (2004) ("Richmond"), and Bighorn-
Desert View Water Agency v. Verjil, 39 Cal.4th 205 (2006) ("Bighorn") have clarified some of the
uncertainty surrounding the applicability of Section 6 of Article XIIID to service fees and charges. In
Richmond, the Shasta Community Services District charged a water connection fee, which included a
capacity charge for capital improvements to the water system and a fire suppression charge. The Court
held that both the capacity charge and the fire suppression charge were not subject to Article XIIID
because a water connection fee is not a property-related fee or charge because it results from the property
owner's voluntary decision to apply for the connection. In both Richmond and Bighorn, however, the
Court stated that a fee for ongoing water service through an existing connection is imposed "as an
incident of property ownership" within the meaning of Article XIIID, rejecting, in Bighorn, the water
agency's argument that consumption-based water charges are not imposed "as an incident of property
ownership"but as a result of the voluntary decisions of customers as to how much water to use.
52224070.4 49
Article XIIID also provides that"standby charges" are considered"assessments" and must follow
the procedures required for "assessments" under Article XIIID and imposes several procedural
requirements for the imposition of any assessment, which may include (1) various notice requirements,
including the requirement to mail a ballot to owners of the affected property; (2) the substitution of a
property owner ballot procedure for the traditional written protest procedure, and providing that"majority
protest" exists when ballots (weighted according to proportional financial obligation) submitted in
opposition exceed ballots in favor of the assessments; and (3) the requirement that the levying entity
"separate the general benefits from the special benefits conferred on a parcel" of land. Article XIIID also
precludes standby charges for services that are not immediately available to the parcel being charged.
Article XIIID provides that all existing, new or increased assessments are to comply with its
provisions beginning July 1, 1997. Existing assessments imposed on or before November 5, 1996, and
"imposed exclusively to finance the capital costs or maintenance and operations expenses for [among
other things] water" are exempted from some of the provisions of Article XIIID applicable to
assessments.
Article XIIIC extends the people's initiative power to reduce or repeal existing local taxes,
assessments, fees and charges. This extension of the initiative power is not limited by the terms of Article
XIIIC to fees, taxes, assessment fees and charges imposed after November 6, 1996 and absent other
authority could result in retroactive reduction in any existing taxes, assessments, fees or charges. In
Bighorn, the Court concluded that under Article XIIIC local voters by initiative may reduce a public
agency's water rates and delivery charges. The Court noted, however, that it was not holding that the
authorized initiative power is free of all limitations, stating that it was not determining whether the
electorate's initiative power is subject to the public agency's statutory obligation to set water service
charges at a level that will "pay the operating expenses of the agency, . . . provide for repairs and
depreciation of works,provide a reasonable surplus for improvements, extensions, and enlargements, pay
the interest on any bonded debt, and provide a sinking or other fund for the payment of the principal of
such debt as it may become due."
The District implemented a five-year plan beginning in Fiscal Year 2002-03 which included a
rate increase of$7.50 per year, or 9.4%, for all ratepayers to $87.50 per year. In May 2003, the Board of
Directors approved a 15% rate increase per year, for each year, over the then following five years, upon
2/3 vote of the Board of Directors after conducting a noticed public hearing in compliance with Article
XIIID. The Board of Directors considered this increase necessary to provide needed capital
improvements,to cover additional treatment and disinfection costs, and to minimize rate increases over an
extended period of time. On July 2, 2003, the Board of Directors adopted Ordinance No. OCSD-20
increasing sanitary sewer service charges for all single family and multi-family residential units as well as
most commercial and industrial properties. The Ordinance was adopted by a 2/3 vote of the Board of
Directors as required under law after conducting a noticed public hearing in compliance with all laws.
The Ordinance increases the amount of the annual charges by approximately 15%per year for each of the
following five years, commencing with Fiscal Year 2003-04, thereby raising the single family residence
user rate from the then current$87.50 to $100.00, $115.00, $132.00, $152.00, and$175.00 annually. The
Ordinance discounted by 5%the annual increases which were the subject of the required protest hearings
on the fee increase as described above. After the completion of the CIP Validation Study for Fiscal Year
2005-06 that increased its ten year CIP cash flow projects to $2.2 billion, or an average of$220 million
per year, the Board of Directors adopted Ordinance No. OCSD-26 increasing the Fiscal Year 2005-06
single family residential rate 31%, from$115 to $151 for such year. In May 2006,the Board of Directors
adopted Ordinance No. OCSD-30B increasing the Fiscal Year 2006-07 single family residential rate
9.8%, from$151.00 to $165.80 for such year, except those located in Revenue Area 14. These increases
represented the increase permitted under the protest hearings on the fee increase which was held in 2003.
In June 2007, the Board of Directors adopted Ordinance No. OCSD-32 increasing the Fiscal Year 2007-
52224070.4 50
08 single family residential rate by 9.8%. In February 2008, after a noticed public hearing, the Board of
Directors adopted Ordinance No. OCSD-35, which provides for annual increases in the single family
residential rate of 10.4%, 10.0%, 10.4%, 9.4%and 10.1%,respectively, for Fiscal Years 2008-09 through
2012-13.
Pursuant to the Master Agreement, the District will,to the extent permitted by law, fix,prescribe
and collect fees and charges for the services of the Wastewater System which will be at least sufficient to
yield during each Fiscal Year(a)Net Revenues equal to 125% of Debt Service on Senior Obligations for
such Fiscal Year, and (b)Net Operating Revenues equal to 100% of Debt Service on all Obligations for
such Fiscal Year. The District may make adjustments from time to time in such fees and charges and may
make such classification thereof as it deems necessary, but will not reduce the fees and charges then in
effect unless the Revenues and Net Revenues from such reduced fees and charges will at all times be
sufficient to meet the requirements of the Master Agreement. In the event that service charges are
determined to be subject to Article XIIID, and proposed increased service charges cannot be imposed as a
result of a majority protest, such circumstances may adversely effect the ability of the District to generate
revenues in the amounts required by the Master Agreement, and to make Installment Payments as
provided in the Installment Purchase Agreement. No assurance may be given that Articles XIIIC and
XIIID will not have a material adverse impact on Net Revenues.
Other Initiative Measures
Articles XIIIA, XIIIB, XIIIC and XIIID were adopted pursuant to California's constitutional
initiative process. From time to time other initiative measures could be adopted by California voters,
placing additional limitations on the ability of the District to increase revenues.
LEGAL MATTERS
The validity of the Notes and certain other legal matters are subject to the approving opinion of
Fulbright& Jaworski L.L.P., Los Angeles, California, Special Counsel to the District. A complete copy
of the proposed form of Special Counsel opinion is attached as Appendix F hereto. Special Counsel, in
its capacity as Special Counsel to the District,undertakes no responsibility for the accuracy, completeness
or fairness of this Official Statement. Certain legal matters will be passed on for the District and the
Corporation by Woodruff, Spradlin& Smart, a Professional Corporation, Costa Mesa, California, and for
the District by Fulbright&Jaworski L.L.P., Disclosure Counsel to the District.
FINANCIAL ADVISOR
The District has retained Public Resources Advisory Group as financial advisor (the "Financial
Advisor") in connection with the execution and delivery of the Notes. The Financial Advisor has not
been engaged, nor have they undertaken, to audit, authenticate or otherwise verify the information set
forth in the Official Statement, or any other related information available to the District, with respect to
accuracy and completeness of disclosure of such information. The Financial Advisor has reviewed this
Official Statement but makes no guaranty, warranty or other representation respecting accuracy and
completeness of the information contained in this Official Statement.
ABSENCE OF LITIGATION
There is no action, suit,proceeding, inquiry or investigation, at law or in equity,before or by any
court, regulatory agency, public board or body, pending or, to the best knowledge of the District,
threatened against the District affecting the existence of the District or the titles of its directors or officers
to their offices or seeking to restrain or to enjoin the sale or delivery of the Notes, the application of the
52224070.4 51
proceeds thereof in accordance with the Trust Agreement, or in any way contesting or affecting the
validity or enforceability of the Notes, the Trust Agreement, the Master Agreement, the Installment
Purchase Agreement or any action of the District contemplated by any of said documents, or in any way
contesting the completeness or accuracy of this Official Statement, or contesting the powers of the
District or its authority with respect to the Notes or any action of the District contemplated by any of said
documents,nor,to the knowledge of the District is there any basis therefor.
There is no action, suit,proceeding, inquiry or investigation, at law or in equity, before or by any
court, regulatory agency, public board or body pending or, to the best knowledge of the District,
threatened against the District contesting or affecting the ability of the District to collect amounts from
which the Installment Payment is payable,or which would have a material adverse effect on the District's
ability to make the Installment Payment.
FINANCIAL STATEMENTS
The basic financial statements of the District included in Appendix A to this Official Statement
have been audited by McGladrey & Pullen, LLP, independent certified public accountants. See
APPENDIX A—"COMPREHENSIVE ANNUAL FINANCIAL REPORT OF THE ORANGE COUNTY
SANITATION DISTRICT FOR FISCAL YEAR ENDED JUNE 30, 2011" herein. The District has
received the Government Finance Officer's Association Certificate of Achievement for "Excellence in
Financial Reporting" for 17 consecutive years. The audited financial statements, including the footnotes
thereto, should be reviewed in their entirety. McGladrey & Pullen, LLP, the District's independent
auditor, has not been engaged to perform, and has not performed, since the date of its report included in
Appendix A, any procedures on the financial statements addressed in that report. McGladrey & Pullen,
LLP also has not performed any procedures relating to this official statement.
TAX MATTERS
The Internal Revenue Code of 1986 (the "Code") imposes certain requirements that must be met
subsequent to the execution and delivery of the Notes for the interest component of the Installment
Payment (the "Interest Component"), and the allocable portion thereof distributable in respect of each
Note (the"Note Interest Distribution"),to be and remain excluded pursuant to section 103(a) of the Code
from the gross income of the owners thereof from the gross income of the owner thereof for federal
income tax purposes. Noncompliance with such requirements could cause such amounts to be included in
gross income for federal income tax purposes retroactive to the date of delivery of the Installment
Purchase Agreement and the Notes.
In the opinion of Fulbright & Jaworski L.L.P., Los Angeles, California, Special Counsel, under
existing statutes, regulations, rulings and court decisions, the Interest Component allocable to and the
Note Interest Distributions in respect of a Note is exempt from personal income taxes of the State of
California and, assuming compliance with the covenants referred to herein, the Interest Component
allocable to and the Note Interest Distributions in respect of a Note are excluded pursuant to
section 103(a) of the Code from the gross income of the owners thereof for federal income tax purposes.
In the further opinion of Special Counsel, under existing statutes, regulations, rulings and court decisions,
the Notes are not "specified private activity bonds" within the meaning of section 57(a)(5) of the Code
and,therefore,the Interest Component allocable to and the Note Interest Distributions in respect of a Note
will not be treated as an item of tax preference for purposes of computing the alternative minimum tax
imposed by section 55 of the Code. Receipt or accrual of the Interest Component allocable to and the
Note Interest Distributions in respect of a Note owned by a corporation may affect the computation of the
alternative minimum taxable income. A corporation's alternative minimum taxable income is the basis on
which the alternative minimum tax imposed by section 55 of the Code will be computed.
52224070.4 52
Notice 94-84, 1994-2 C.B. 559, states that the Internal Revenue Service (the "Service") is
studying whether the stated interest portion of the payment at maturity on a short-term debt obligation
(such as the Notes),that matures not more than one year from the date of issue,bears a stated fixed rate of
interest and is described in section 103(a) of the Code, is (i) qualified stated interest that is excluded from
the stated redemption price at maturity of the obligation(within the meaning of section 1273 of the Code)
but is excluded from gross income pursuant to section 103(a) of the Code, or (ii) is not qualified stated
interest and, therefore, is included by the taxpayer in the stated redemption price at maturity of the
obligation, creating or increasing (as to that taxpayer) original issue discount on the obligation that is
excluded from gross income pursuant to section 103(a) of the Code. Notice 94-84 states that until the
Service provides further guidance with respect to tax-exempt short-term debt obligations, a taxpayer
holding such obligations may treat the stated interest payable at maturity either as qualified stated interest
or as included in the stated redemption price at maturity of the obligation. However, the taxpayer must
treat the amounts to be paid at maturity on all tax-exempt short-term debt obligations in a consistent
manner. Notice 94-84 does not address various aspects necessary to the application of the latter method
(including, for example, the treatment of a holder acquiring its Note other than in the original public
offering or at a price other than the original offering price). Each person considering acquiring the Notes
should consult its own tax advisor with respect to the tax consequences of ownership of and of the
election between the choices of treatment of the stated interest payable at maturity on the Notes.
The initial public offering price for the Notes is greater than the principal amount payable on the
Notes at maturity. To the extent that a purchaser of a Note who treats the stated interest payable at
maturity as qualified stated interest (as described above) acquires the Note at a price greater than the
aggregate amount (other than such qualified stated interest) payable on such Note, such excess will
constitute "bond premium" under the Code. Section 171 of the Code, and the Treasury Regulations
promulgated thereunder, provide generally that bond premium on a non-callable tax-exempt obligation
must be amortized over the remaining term of the obligation: the amount of premium so amortized will
reduce the owner's basis in such Note for federal income tax purposes, but such amortized premium will
not be deductible for federal income tax purposes. Consequently, an owner of a Note who purchased the
Note with bond premium and held the Note until paid at maturity generally will not realize tax gain or
loss on such Note. The rate and timing of the amortization of the bond premium and the corresponding
basis reduction may result in an owner realizing a taxable gain when a Note owned by such owner is sold
or disposed of for an amount equal to or in some circumstances even less than the original cost of the
Note to the owner. Purchasers should consult their own tax advisors as to the computation and treatment
of such amortizable bond premium, including, but not limited to, the calculation of gain or loss upon the
sale,maturity or other disposition of a Note.
Pursuant to the Trust Agreement and in the Tax Certificate Pertaining to Arbitrage and Other
Matters under Sections 103 and 141-150 of the Internal Revenue Code of 1986, to be delivered by the
District and the Corporation in connection with the issuance of the Notes,the District and the Corporation
will make representations relevant to the determination of, and will make certain covenants regarding or
affecting, the exclusion of interest on the Notes from the gross income of the owners thereof for federal
income tax purposes. In reaching its opinions described above, Special Counsel will assume the accuracy
of such representations and the present and future compliance by the District and the Corporation with
such covenants referred to herein. Further, except as stated above, Special Counsel will express no
opinion as to any federal or state tax consequences of the receipt of interest on, or the ownership or
disposition of,the Notes.
Special Counsel has not undertaken to advise in the future whether any events after the date of
execution and delivery of the Installment Purchase Agreement and the Notes may affect the tax status of
the Interest Component or the Note Interest Distributions. No assurance can be given that future
legislation, if enacted into law, will not contain provisions that could directly or indirectly reduce the
52224070.4 53
benefit of the exemption of such amounts from personal income taxation by the State of California or of
the exclusion of the interest on the Notes from the gross income of the owners thereof for federal income
tax purposes. Furthermore, Special Counsel will express no opinion as to any federal, state or local tax
law consequences with respect to the Installment Purchase Agreement,the Notes,the Interest Component
or Note Interest Distributions, if any action is taken with respect to the Installment Purchase Agreement,
the Notes or the proceeds thereof, or the Trust Agreement predicated or permitted upon the advice or
approval of other counsel.
Special Counsel's opinion is not a guarantee of a result, but represents its legal judgment based
upon its review of existing statutes, regulations, published rulings and court decisions and the
representations and covenants of the District and the Corporation described above. No ruling has been
sought from the Internal Revenue Service (the "Service") with respect to the matters addressed in the
opinion of Special Counsel, and Special Counsel's opinion is not binding on the Service. The Service has
an ongoing program of auditing the tax-exempt status of the interest on municipal obligations. If an audit
of the Notes is commenced, under current procedures the Service is likely to treat the District as the
"taxpayer," and the owners would have no right to participate in the audit process. In responding to or
defending an audit of the tax-exempt status of the Interest Component and Note Interest Distributions
accrued in respect of Notes, the District may have different or conflicting interest from the owners.
Public awareness of any future audit of the Notes could adversely affect the value and liquidity of the
Notes during the pendency of the audit,regardless of its ultimate outcome.
Although Special Counsel is of the opinion that Interest Component and Note Interest
Distributions in respect of a Note are exempt from California personal income tax and excluded from the
gross income of the owners thereof for federal income tax purposes, an owner's federal, state or local tax
liability may be otherwise affected by the ownership or disposition of the Notes. The nature and extent of
these other tax consequences will depend upon the owner's other items of income or deduction. Without
limiting the generality of the foregoing, prospective purchasers of the Notes should be aware that (i)
section 265 of the Code denies a deduction for interest on indebtedness incurred or continued to purchase
or carry the Notes and the Code contains additional limitations on interest deductions applicable to
financial institutions that own tax-exempt obligations (such as the Notes), (ii) with respect to insurance
companies subject to the tax imposed by section 831 of the Code, section 832(b)(5)(B)(i) reduces the
deduction for loss reserves by 15% of the sum of certain items, including Interest Component and Note
Interest Distributions in respect of the Notes, (iii) Interest Component and Note Interest Distributions
accrued in respect of Notes owned by certain foreign corporations doing business in the United States
could be subject to a branch profits tax imposed by section 884 of the Code, (iv) passive investment
income, including Interest Component and Note Interest Distributions accrued in respect of Notes,may be
subject to federal income taxation under section 1375 of the Code for Subchapter S corporations that have
Subchapter C earnings and profits at the close of the taxable year if greater than 25% of the gross receipts
of such Subchapter S corporation is passive investment income, (v) section 86 of the Code requires
recipients of certain Social Security and certain Railroad Retirement benefits to take into account, in
determining the taxability of such benefits, Interest Distributions and Note Interest Distributions accrued
in respect of Notes owned by such recipients for federal income tax purposes, and(vi)under section 32(i)
of the Code, receipt of investment income, including Interest Component and Note Interest Distributions
accrued in respect of Notes,may disqualify the recipient thereof from obtaining the earned income credit.
Special Counsel has expressed no opinion regarding any such other tax consequences.
Existing law may change to reduce or eliminate the benefit to noteholders of the exclusion of
interest on the Interest Component and Note Interest Distributions accrued in respect of the Notes from
gross income for federal income tax purposes. Any proposed legislation or administrative action,whether
or not taken, could also affect the value and marketability of the Notes. Prospective purchasers of the
52224070.4 54
Notes should consult with their own tax advisors with respect to any proposed or future changes in tax
law.
A copy of the form of opinion of Special Counsel to be delivered at the closing of the Notes is
included in Appendix F.
CONTINUING DISCLOSURE
The District has covenanted for the benefit of holders and beneficial owners of the Notes to
provide notices of the occurrence of certain enumerated events. The notices of material events, if any,
will be filed by the Dissemination Agent on behalf of the District with the Municipal Securities
Rulemaking Board. The specific nature of the information to be contained in the notices of enumerated
events is set forth in the Continuing Disclosure Agreement. See APPENDIX D — "FORM OF
CONTINUING DISCLOSURE AGREEMENT." This covenant has been made in order to assist the
Initial Purchaser in complying with S.E.C. Rule 15c2-12 (the "Rule"). During the past five years, the
District has never failed to comply in all material respects with any previous undertaking with respect to
the Rule to provide annual reports or notices of material events.
RATINGS
The Notes will be assigned short-term ratings of" "by Standard&Poor's Financial Services
LLC ("S&P") and " " by Fitch Ratings ("Fitch"). S&P and Fitch affirmed the long-term ratings of
" " and " ,"respectively, on the District's Existing Senior Obligations. Such ratings reflect only
the views of the rating agencies, and do not constitute a recommendation to buy, sell or hold the Notes.
Explanation of the significance of such ratings may be obtained only from the respective organizations at:
Standard & Poor's Ratings Services, 55 Water Street, New York, New York 10041 and Fitch Ratings,
One State Street Plaza, New York, New York 10004. There is no assurance that any such ratings will
continue for any given period of time or that they will not be revised downward or withdrawn entirely by
the respective rating agencies, if in the judgment of any such rating agency circumstances so warrant.
Any such downward revision or withdrawal of such ratings may have an adverse effect on the market
price of the Notes.
PURCHASE AND REOFFERING
(the "Initial Purchaser") has purchased the Notes from the District at a
competitive sale for a purchase price of$ (representing the aggregate principal amount of the
Notes, plus a premium of$ , less an underwriter's discount of$ ). The public offering
price may be changed from time to time by the Initial Purchaser. The Initial Purchaser may offer and sell
Notes to certain dealers and others at prices lower than the offering price shown on the cover page hereof.
MISCELLANEOUS
Included herein are brief summaries of certain documents and reports, which summaries do not
purport to be complete or definitive, and reference is made to such documents and reports for full and
complete statements of the contents thereof. Any statements in this Official Statement involving matters
of opinion, whether or not expressly so stated, are intended as such and not as representations of fact.
This Official Statement is not to be construed as a contract or agreement between the District and the
purchasers or Owners of any of the Notes.
52224070.4 55
The execution and delivery of this Official Statement has been duly authorized by the District.
ORANGE COUNTY SANITATION DISTRICT
By:
Chair of the Board of Directors
52224070.4 56
APPENDIX A
COMPREHENSIVE ANNUAL FINANCIAL REPORT OF THE ORANGE COUNTY
SANITATION DISTRICT FOR FISCAL YEAR ENDED JUNE 30,2011
52224070.4 A-]
APPENDIX B
THE COUNTY OF ORANGE-ECONOMIC AND DEMOGRAPHIC INFORMATION
52224070.4 B-1
APPENDIX C
SUMMARY OF PRINCIPAL LEGAL DOCUMENTS
52224070.4 C-1
APPENDIX D
FORM OF CONTINUING DISCLOSURE AGREEMENT
52224070.4 D-1
APPENDIX E
BOOK-ENTRY SYSTEM
The description that follows of the procedures and recordkeeping with respect to beneficial
ownership interests in the Notes,payment ofprincipal and interest evidenced by the Notes to Participants
or Beneficial Owners, confirmation and transfer of beneficial ownership interests in the Notes, and other
Note-related transactions by and between DTC, Participants and Beneficial Owners, is based on
information furnished by DTC which the District and the Corporation each believes to be reliable, but the
District and the Corporation take no responsibility for the completeness or accuracy thereof.
The Depository Trust Company—Book-Entry System
The Depository Trust Company("DTC"),New York,NY,will act as securities depository for the
securities (the "Notes"). The Notes will be issued as fully-registered securities registered in the name of
Cede & Co. (DTC's partnership nominee) or such other name as may be requested by an authorized
representative of DTC. One fully-registered note will be issued for the Notes in the aggregate principal
amount of such issue, and will be deposited with DTC.
DTC is a limited-purpose trust company organized under the New York Banking Law, a
"banking organization" within the meaning of the New York Banking Law, a member of the Federal
Reserve System, a "clearing corporation" within the meaning of the New York Uniform Commercial
Code, and a "clearing agency" registered pursuant to the provisions of Section 17A of the Securities
Exchange Act of 1934. DTC holds and provides asset servicing for over 3.5 million U.S. and non-U.S.
equity issues, corporate and municipal debt issues, and money market instruments (from over 100
countries) that DTC's participants ("Direct Participants") deposit with DTC. DTC also facilitates the
post-trade settlement among Direct Participants of sales and other securities transactions in deposited
securities,through electronic computerized book-entry transfers and pledges between Direct Participants'
accounts. This eliminates the need for physical movement of securities certificates. Direct Participants
include both U.S. and non-U.S. securities brokers and dealers, banks, trust companies, clearing
corporations, and certain other organizations. DTC is a wholly-owned subsidiary of The Depository Trust
& Clearing Corporation ("DTCC"). DTCC is the holding company for DTC, National Securities
Clearing Corporation and Fixed Income Clearing Corporation, all of which are registered clearing
agencies. DTCC is owned by the users of its regulated subsidiaries. Access to the DTC system is also
available to others such as both U.S. and non-U.S. securities brokers and dealers,banks, trust companies,
and clearing corporations that clear through or maintain a custodial relationship with a Direct Participant,
either directly or indirectly("Indirect Participants"). DTC has a Standard&Poor's rating of"AA+." The
DTC Rules applicable to its Participants are on file with the Securities and Exchange Commission. More
information about DTC can be found at www.dtcc.com. The information on such website is not
incorporated herein by such reference or otherwise.
Purchases of Notes under the DTC system must be made by or through Direct Participants,which
will receive a credit for the Notes on DTC's records. The ownership interest of each actual purchaser of
each Note (`Beneficial Owner") is in turn to be recorded on the Direct and Indirect Participants' records.
Beneficial Owners will not receive written confirmation from DTC of their purchase. Beneficial Owners
are, however, expected to receive written confirmations providing details of the transaction, as well as
periodic statements of their holdings, from the Direct or Indirect Participant through which the Beneficial
Owner entered into the transaction. Transfers of ownership interests in the Notes are to be accomplished
by entries made on the books of Direct and Indirect Participants acting on behalf of Beneficial Owners.
Beneficial Owners will not receive certificates representing their ownership interests in the Notes, except
in the event that use of the book-entry system for the Notes is discontinued.
52224070.4 E-1
To facilitate subsequent transfers, all Notes deposited by Direct Participants with DTC are
registered in the name of DTC's partnership nominee, Cede & Co. or such other name as may be
requested by an authorized representative of DTC. The deposit of Notes with DTC and their registration
in the name of Cede& Co. or such other nominee do not effect any change in beneficial ownership. DTC
has no knowledge of the actual Beneficial Owners of the Notes; DTC's records reflect only the identity of
the Direct Participants to whose accounts such Notes are credited, which may or may not be the
Beneficial Owners. The Direct and Indirect Participants will remain responsible for keeping account of
their holdings on behalf of their customers.
Conveyance of notices and other communications by DTC to Direct Participants, by Direct
Participants to Indirect Participants, and by Direct Participants and Indirect Participants to Beneficial
Owners will be governed by arrangements among them, subject to any statutory or regulatory
requirements as may be in effect from time to time. Beneficial Owners of Notes may wish to take certain
steps to augment transmission to them of notices of significant events with respect to the Notes, such as
prepayments, tenders, defaults, and proposed amendments to the security documents. For example,
Beneficial Owners of Notes may wish to ascertain that the nominee holding the Notes for their benefit has
agreed to obtain and transmit notices to Beneficial Owners, in the alternative, Beneficial Owners may
wish to provide their names and addresses to the registrar and request that copies of the notices be
provided directly to them.
Prepayment notices shall be sent to DTC. If less than all of the Notes within an issue are being
prepaid,DTC's practice is to determine by lot the amount of the interest of each Direct Participant in such
issue to be prepaid.
Neither DTC nor Cede & Co. (nor such other DTC nominee)will consent or vote with respect to
the Notes unless authorized by a Direct Participant in accordance with DTC's MMI Procedures. Under
its usual procedures, DTC mails an Omnibus Proxy to the District as soon as possible after the record
date. The Omnibus Proxy assigns Cede &Co.'s consenting or voting rights to those Direct Participants to
whose accounts the Notes are credited on the record date (identified in a listing attached to the Omnibus
Proxy).
Prepayments with respect to the Notes will be made to Cede &Co.,or such other nominee as may
be requested by an authorized representative of DTC. DTC's practice is to credit Direct Participants'
accounts, upon DTC's receipt of funds and corresponding detail information from the District or the
Trustee on the payable date in accordance with their respective holdings shown on DTC's records.
Payments by Participants to Beneficial Owners will be governed by standing instructions and customary
practices, as is the case with securities held for the accounts of customers in bearer form or registered in
"street name," and will be the responsibility of such Participant and not of DTC, nor its nominee, the
Trustee, or the District, subject to any statutory or regulatory requirements as may be in effect from time
to time. Payment of prepayment proceeds, distributions, and dividend payments to Cede & Co. (or such
other nominee as may be requested by an authorized representative of DTC) is the responsibility of the
District or the Trustee, disbursement of such payments to Direct Participants will be the responsibility of
DTC, and disbursement of such payments to the Beneficial Owners will be the responsibility of Direct
and Indirect Participants.
DTC may discontinue providing its services as securities depository with respect to the Notes at
any time by giving reasonable notice to the District or the Trustee. Under such circumstances, in the
event that a successor securities depository is not obtained,Notes are required to be printed and delivered.
The District may decide to discontinue use of the system of book-entry-only transfers through
DTC (or a successor securities depository). In that event,Notes will be printed and delivered to DTC.
52224070.4 E-2
The information in this section concerning DTC and DTC's book-entry system has been obtained
from sources that the District believes to be reliable, but the District takes no responsibility for the
accuracy thereof.
Discontinuance of DTC Services
In the event (i)DTC determines not to continue to act as securities depository for the Notes,
(ii)DTC shall no longer act and give notice to the Trustee of such determination or (iii)the District
determines that it is in the best interest of the Beneficial Owners that they be able to obtain Notes and
delivers a written certificate to the Trustee to that effect, DTC services will be discontinued. If the
District determines to replace DTC with another qualified securities depository, the District shall prepare
or direct the preparation of a new single, separate, fully registered Note for each of the maturities of the
Notes, registered in the name of such successor or substitute qualified securities depository or its
nominee. If the District fails to identify another qualified securities depository to replace DTC then the
Notes shall no longer be restricted to being registered in the certificate registration books in the name of
Cede & Co., but shall be registered in such names as are requested in a certificate of the District, in
accordance with the Trust Agreement.
All Notes may be presented for transfer by the Owner thereof, in person or by his attorney duly
authorized in writing, at the Principal Office of the Trustee, on the books required to be kept by the
Trustee pursuant to the provisions of the Trust Agreement, upon surrender of such Certifications for
cancellation accompanied by delivery of a duly executed written instrument of transfer in a form
acceptable to the Trustee. The Trustee may treat the Owner of any Note as the absolute owner of such
Note for all purposes,whether or not such Note shall be overdue, and the Trustee shall not be affected by
any knowledge or notice to the contrary; and payment of the interest and principal evidenced by such
Note shall be made only to such Owner, which payments shall be valid and effectual to satisfy and
discharge the liability evidenced by such Note to the extent of the sum or sums so paid.
Whenever any Notes shall be surrendered for transfer, the Trustee shall execute and deliver new
Notes representing the same principal amount in Authorized Denominations. The Trustee shall require
the payment of any Owner requesting such transfer of any tax or other governmental charge required to
be paid with respect to such transfer. Notes may be presented for exchange at the Principal Office of the
Trustee for a like aggregate principal amount of Notes of other Authorized Denominations. The Trustee
shall require the payment by the Owner requesting such exchange of any tax or other governmental
charge required to be paid with respect to such exchange. The Trustee shall not be required to transfer or
exchange any Note during the period in which the Trustee is selecting Notes for prepayment,nor shall the
Trustee be required to transfer or exchange any Note or portion thereof selected for prepayment from and
after the date of mailing the notice of prepayment thereof.
52224070.4 E-3
APPENDIX F
FORM OF APPROVING OPINION OF SPECIAL COUNSEL
Upon the execution and delivery of the Notes, Fulbright& Jaworski L.L.P., Los Angeles,
California, Special Counsel to the District, will render its final approving opinion with respect to the
Notes in substantially the following form:
[Date of Delivery]
Orange County Sanitation District
10844 Ellis Avenue
Fountain Valley,California 92708-7018
Orange County Sanitation District
Revenue Refunding Certificate Anticipation Notes, Series 2012C
Ladies and Gentlemen:
We have acted as Special Counsel in connection with the $ aggregate principal
amount of Orange County Sanitation District Revenue Refunding Certificate Anticipation Notes, Series
2012C (the "Notes"), which evidence direct, fractional undivided interests of the Owners thereof in the
installment payment (the "Installment Payment"), and the interest thereon, to be made by the Orange
County Sanitation District (the "District") pursuant to the Installment Purchase Agreement, dated as of
October 1, 2012 (the "Installment Purchase Agreement'), by and between the District and the Orange
County Sanitation District Financing Corporation(the"Corporation"). Pursuant to the Master Agreement
for District Obligations, dated as of August 1, 2000 (the "Master Agreement'), by and between the
District and the Corporation, the District has established conditions and terms upon which obligations
such as the Installment Payment and the interest thereon, will be incurred and secured. The Installment
Payment under the Installment Purchase Agreement is payable from (i)Net Revenues as provided in the
Installment Purchase Agreement, consisting primarily of all income and revenue received by the District
from the operation or ownership of the Wastewater System of the District (the "Wastewater System")
remaining after payment of Maintenance and Operation Costs, and (ii)other lawfully available funds of
the District. Capitalized terms used and not otherwise defined herein shall have the meanings ascribed to
such terms in the Installment Purchase Agreement.
The Notes are to be executed and delivered pursuant to a Trust Agreement, dated as of October 1,
2012 (the "Trust Agreement'), by and among the District, the Corporation and Union Bank, N.A., as
trustee (the "Trustee"). Proceeds from the sale of the Notes will be used to (i)pay at maturity all of the
Orange County Sanitation District Revenue Refunding Certificate Anticipation Notes, Series 2011B,
currently outstanding in the aggregate principal amount of$143,205,000, and(ii)pay the costs incurred in
connection with the execution and delivery of the Notes.
As Special Counsel,we have examined copies certified to us as being true and complete copies of
the Master Agreement,the Trust Agreement and the Installment Purchase Agreement and the proceedings
of the District in connection with the execution and delivery of the Notes. We have also examined such
52224070.4 F-1
certificates of officers of the District, the Corporation and others as we have considered necessary for the
purposes of this opinion.
Based upon the foregoing,we are of the opinion that:
1. The Master Agreement, the Installment Purchase Agreement and the Trust
Agreement each has been duly and validly authorized, executed and delivered by the District and,
assuming the Master Agreement, the Installment Purchase Agreement and the Trust Agreement
each constitutes the legally valid and binding obligation of the other parties thereto, each
constitutes the legally valid and binding obligation of the District, enforceable against the District
in accordance with its respective terms
2. The obligation of the District to pay the Installment Payment, and the interest
thereon, and other payments required to be made by it under the Installment Purchase Agreement
is a special obligation of the District payable, in the manner provided in the Installment Purchase
Agreement, from Net Revenues and other funds provided for in the Installment Purchase
Agreement lawfully available therefor.
3. Assuming due authorization, execution and delivery of the Trust Agreement and
the Notes by the Trustee,the Notes are entitled to the benefits of the Trust Agreement.
4. Under existing statutes, regulations, rulings and court decisions, and, assuming
compliance with the covenants mentioned below, the component of each Installment Payment
designated as "Interest on Installment Payment" in Section 3.02 of the Installment Purchase
Agreement (the "Interest Component"), and the allocable portion thereof distributable in respect
of any Note (the "Note Interest Distribution"), is excluded pursuant to section 103(a) of the
Internal Revenue Code of 1986 (the "Code") from the gross income of the owners thereof for
federal income tax purposes. We are further of the opinion that under existing statutes,
regulations, rulings and court decisions, the Notes are not "specified private activity bonds"
within the meaning of section 57(a)(5)of the Code and,therefore,the Interest Component and the
Note Interest Distributions will not be treated as an item of tax preference for purposes of
computing the alternative minimum tax imposed by section 55 of the Code. Receipt or accrual of
the Interest Component,and the Note Interest Distribution,owned by a corporation may affect the
computation of the alternative minimum taxable income of that corporation. A corporation's
alternative minimum taxable income is the basis on which the alternative minimum tax imposed
by section 55 of the Code will be computed. We are further of the opinion that the Interest
Component allocable to and the Note Interest Distributions in respect of a Note, are exempt from
personal income taxes of the State of California under present state law.
Pursuant to the Trust Agreement and in the Tax Certificate Pertaining to Arbitrage and
Other Matters under Sections 103 and 141-150 of the Internal Revenue Code of 1986, to be
delivered by the District in connection with the execution and delivery of the Notes, the District
will make representations relevant to the determination of, and will make certain covenants
regarding or affecting, the exclusion of the Interest Component and the Note Interest Distribution
from the gross income of the owners thereof for federal income tax purposes. In reaching the
opinions described in the immediately preceding paragraph, we have assumed the accuracy of
such representations and the present and future compliance by the District with such covenants.
52224070.4 F-2
Except as stated in the second preceding paragraph, we express no opinion as to any
federal or state tax consequence of the ownership or disposition of the Installment Purchase
Agreement or the Notes. Furthermore, we express no opinion as to any federal, state or local tax
law consequences with respect to the Installment Purchase Agreement, Notes, Interest
Component, or Note Interest Distributions, if any action is taken with respect to the Installment
Purchase Agreement, the Master Agreement, the Trust Agreement, the Notes or the proceeds
thereof,permitted or predicated on the advice or approval of counsel, if such advice or approval is
given by counsel other than us.
The rights of the owners of the Notes and the enforceability of the Notes, the Master Agreement,
the Trust Agreement and the Installment Purchase Agreement may be subject to bankruptcy, insolvency,
reorganization, moratorium and other similar laws affecting creditors' rights heretofore or hereafter
enacted and may also be subject to the exercise of judicial discretion in appropriate cases. The
enforceability of the Notes, the Master Agreement, the Trust Agreement and the Installment Purchase
Agreement is subject to the effect of general principles of equity, including, without limitation, concepts
of materiality, reasonableness, good faith and fair dealing, to the possible unavailability of specific
performance or injunctive relief,regardless of whether considered in a proceeding in equity or at law, and
to the limitations on legal remedies against governmental entities in California.
No opinion is expressed herein on the accuracy, completeness or fairness of the Official
Statement or other offering material relating to the Notes.
Our opinions are based on existing law, which is subject to change. Such opinions are further
based on our knowledge of facts as of the date hereof. We assume no duty to update or supplement our
opinions to reflect any facts or circumstances that may hereafter come to our attention or to reflect any
changes in any law that may hereafter occur or become effective. Moreover, our opinions are not a
guarantee of result; rather, such opinions represent our legal judgment based upon our review of existing
law that we deem relevant to such opinions and in reliance upon the representations and covenants
referenced above.
Respectfully submitted,
52224070.4 F-3
Fulbright & Jaworski L.L.P.— Draft 09/11/12
OFFICIAL NOTICE INVITING BIDS
ORANGE COUNTY SANITATION DISTRICT
REVENUE REFUNDING CERTIFICATE ANTICIPATION NOTES, SERIES 2012C
(Book-Entry-Only)
NOTICE IS HEREBY GIVEN that bids will be received by the Orange County Sanitation
District(the"District") for the purchase of$ *original principal amount of Orange County
Sanitation District Revenue Refunding Certificate Anticipation Notes, Series 2012C (the "Notes"). Bids
for less than all of the Notes will not be accepted. The bids will be received in the form, in the manner
and up to the time specified below(unless postponed as described herein):
Date: Thursday, October 18,2012
11:30 a.m.,New York Time
Electronic Bids: Electronic proposals may be submitted through the Parity®
electronic bid submission system of Ipreo, at
www.newissuehome.i-deal.com (the "Electronic Service"). The
Electronic Service will act as agent of the bidder and not of the
District in connection with the submission of bids and the District
assumes no responsibility or liability for bids submitted through
the Electronic Service. See "Information Regarding Electronic
Proposals"herein.
No Facsimile,Hand Delivery or No facsimile,hand delivery or sealed bids will be accepted.
Sealed Bids:
Terms of the Notes
The Preliminary Official Statement for the Notes, dated October 2012, including the cover
page and all appendices thereto (the "Preliminary Official Statement"), provides certain information
concerning the sale and delivery of $ * aggregate principal amount of the Notes
evidencing direct, undivided fractional interests in the Installment Payment (the "Installment Payment"),
and the interest thereon,payable by the District pursuant to the Installment Purchase Agreement, dated as
of October 1, 2012 (the "Installment Purchase Agreement"), by and between the District and the Orange
County Sanitation District Financing Corporation (the "Corporation"). Each bidder must have obtained
and reviewed the Preliminary Official Statement prior to bidding for the Notes. This Official Notice
Inviting Bids, including all exhibits and attachments, contains certain information for quick reference
only, is not a summary of the issue and governs only the terms of the sale of, bidding for and closing
procedures with respect to the Notes. Bidders must read the entire Preliminary Official Statement to
obtain information essential to making an informed investment decision.
Pursuant to the Master Agreement for District Obligations, dated as of August 1, 2000 (the
"Master Agreement"), by and between the District and the Corporation, the District has established and
declared the conditions and terms upon which obligations such as the Installment Purchase Agreement,
and the Installment Payments and the interest thereon, will be incurred and secured. The Installment
*Preliminary,subject to change.
95713584.3
Payment under the Installment Purchase Agreement is payable solely from Net Revenues, as provided in
the Master Agreement and the Installment Purchase Agreement, consisting primarily of all income and
revenue received by the District from the operation or ownership of the Wastewater System of the District
(the"Wastewater System")remaining after payment of Maintenance and Operation Costs.
The Issue
The proceeds from the sale of the Notes will be used to: (i)pay on November 9, 2012, all of the
Orange County Sanitation District Revenue Refunding Certificate Anticipation Notes, Series 2011B,
currently outstanding in the aggregate principal amount of$143,205,000 and(ii)pay the costs incurred in
connection with the execution and delivery of the Notes. The Notes are to be executed and delivered
pursuant to a Trust Agreement, dated as of October 1, 2012 (the "Trust Agreement"), by and among the
District, the Corporation and Union Bank,N.A., as trustee (the "Trustee"). Capitalized terms not defined
herein shall have the same definitions as used in the Trust Agreement or the Master Agreement.
Authorization
On September 26,2012,the District and the Corporation authorized the execution and delivery of
the Installment Purchase Agreement,the Trust Agreement and the Notes.
Outstanding Senior Obligations
The District has outstanding Senior Obligations payable on a parity with the Installment Payment
under the Installment Purchase Agreement. The term "Existing Senior Obligations" as used in the
Preliminary Official Statement refers to the 2007A Installment Purchase Agreement, the 2007B
Installment Purchase Agreement, the 2008A Installment Purchase Agreement, the 2008B Installment
Purchase Agreement, the 2009A Installment Purchase Agreement, the 2010A Installment Purchase
Agreement, the 2010C Installment Purchase Agreement, the 2011A Installment Purchase Agreement,
2011B Installment Purchase Agreement, 2012A Installment Purchase Agreement and 2012B Installment
Purchase Agreement.
Security and Source of Payments
The Notes evidence direct, undivided fractional interests in the Installment Payment, and the
interest thereon, paid by the District pursuant to the Installment Purchase Agreement. The obligation of
the District to pay the Installment Payment and the interest thereon and other payments required to be
made by it under the Installment Purchase Agreement is a special obligation of the District payable, in the
manner provided under the Installment Purchase Agreement, solely from Net Revenues and other funds
as provided in the Installment Purchase Agreement. Net Revenues generally consist of all income and
revenue received by the District from the operation or ownership of the Wastewater System remaining
after payment of Maintenance and Operation Costs,all as further provided in the Master Agreement.
The District's obligation to make the Installment Payment from Net Revenues is on a parity with
the District's obligation to make payments with respect to its other outstanding obligations described as
Senior Obligations and all Reimbursement Obligations with respect to Senior Obligations, as provided in
the Master Agreement. The Installment Purchase Agreement constitutes a Senior Obligation and is
subject to the provisions of the Master Agreement and is afforded all of the advantages, benefits, interests
and security for Senior Obligations pursuant to the Master Agreement. Pursuant to the Master
Agreement, the District pledges all Net Revenues to the payment of the Senior Obligations and
Reimbursement Obligations with respect to Senior Obligations, and the Net Revenues will not be used for
any other purpose while any of the Senior Obligations or Reimbursement Obligations with respect to
95713584.3 2
Senior Obligations remain unpaid; provided, however, that out of the Net Revenues there may be
apportioned such sums for such purposes as are expressly permitted by the Master Agreement. This
pledge constitutes a first lien on the Net Revenues for the payment of the Senior Obligations and
Reimbursement Obligations with respect to Senior Obligations. The term Senior Obligations, generally
means all revenue bonds or notes(including bond anticipation notes and commercial paper)of the District
authorized, executed, issued and delivered under and pursuant to applicable law,the Installment Purchase
Agreement and all other contracts (including financial contracts) or leases of the District authorized and
executed by the District under and pursuant to applicable law, the installment, lease or other payments
which are, in accordance with the provisions of the Master Agreement, payable from Net Revenues on a
parity with the payments under the Master Agreement.
The District may at any time incur Subordinate Obligations; provided, however, that prior to
incurring such Subordinate Obligations, the District will have determined that the incurrence thereof will
not materially adversely affect the District's ability to comply with the requirements of the Master
Agreement. The District may at any time incur Reimbursement Obligations with respect to Subordinate
Obligations. Currently, there are no Subordinate Obligations outstanding. For a description of the
District's outstanding Senior Obligations, see "FINANCIAL OBLIGATIONS — Existing Indebtedness"
in the Preliminary Official Statement.
The District may, in connection with the incurrence of Subordinate Obligations, pledge Net
Revenues to the payment of Subordinate Obligations and Reimbursement Obligations with respect to
Subordinate Obligations; provided, however, that such pledge, and any lien created thereby, shall be
junior and subordinate to the pledge of, and lien on,Net Revenues for the payment of Senior Obligations
and Reimbursement Obligations with respect to Senior Obligations.
Pursuant to the Master Agreement, the District is required, to the extent permitted by law, to fix,
prescribe and collect fees and charges for the services and facilities of the Wastewater System which will
be at least sufficient to yield during each Fiscal Year(a)Net Revenues equal to 125% of Debt Service on
Senior Obligations for such Fiscal Year and (b) Net Operating Revenues equal to 100% of Debt Service
on all Obligations for such Fiscal Year. The District may make adjustments from time to time in such
fees and charges and may make such classification thereof as it deems necessary, but shall not reduce the
fees and charges then in effect unless the Revenues and Net Revenues from such reduced fees and
charges will at all times be sufficient to meet the requirements of the Master Agreement. See
"SECURITY AND SOURCES OF PAYMENT FOR THE NOTES—Rate Covenant" in the Preliminary
Official Statement.
Additional Obligations
In addition to the Existing Senior Obligations, the District may at any time incur Obligations
payable on a parity or on a subordinate basis to the payment by the District of the Installment Payment
upon satisfaction of conditions provided in the Master Agreement. No Obligations payable on such a
subordinate basis are currently outstanding. See "SECURITY AND SOURCES OF PAYMENT FOR
THE NOTES Limitations on Issuance of Additional Obligations" in the Preliminary Official
Statement.
Book-Entry-Only
The Notes will be executed and delivered in the form of fully registered certificates payable in
lawful money of the United States of America. The Notes will be initially delivered only in book-entry
form and will be registered in the name of Cede & Co., as nominee of The Depository Trust Company,
New York, New York ("DTC"), which will act as securities depository for the Notes. Individual
95713584.3 3
purchases of the Notes will be made in book-entry form only. Purchasers of Notes will not receive
physical certificates representing their ownership interests in the Notes purchased. The Notes will be
delivered in Authorized Denominations of $5,000 and any integral multiple thereof. Payments of
principal and interest evidenced by the Notes are payable directly to DTC by the Trustee. Upon receipt of
payments of such principal and interest, DTC will in turn distribute such payments to the beneficial
owners of the Notes. So long as the Notes are in the DTC book-entry system, the interest, principal and
prepayment premiums, if any, due with respect to the Notes will be payable by the Trustee, or its agent,to
DTC or its nominee.
Principal and Interest Payments
The Notes will mature on October 30, 2013* (the "Maturity Date"). The District expects the
principal of and interest on the Notes to be paid from proceeds of the sale,prior to the Maturity Date, of a
future series of certificates of participation, notes or other obligations of the District. The sale and
delivery of a future series of certificates of participation, notes or other obligations of the District will
depend on market conditions, certain approvals by the District and the Corporation and other factors. See
"SECURITY AND SOURCES OF PAYMENT FOR THE NOTES" in the Preliminary Official
Statement.
No Prepayment
The Notes are not subject to prepayment prior to their maturity.
Interest Rates,Reoffering Prices,Premium Bids,and Certificate of Initial Purchaser
Bidders must bid to purchase all and not part of the Notes and must submit their bids on the
Official Bid Form. Bidders must specify a rate of interest for the Notes, expressed in multiples of either
[one-eighths (1/8) or one-twentieths (1/20) of one percent (1%); and no interest rate can exceed 3.5% per
annum.]
The successful bidder will, within 30 minutes after being notified of the award of the Notes,
advise the District of the initial bona fide public reoffering prices of the Notes on the date of award. The
successful bidder will also be required to furnish to the District a certificate ("Certificate of Initial
Purchaser") in the form of the Certificate of Initial Purchaser attached hereto (with such modifications as
may be acceptable to Special Counsel). At any time before or after delivery of the Notes to the successful
bidder, that successful bidder also may be required by the District or Special Counsel to clarify any
discrepancies between the Certificate of Initial Purchaser and publicly available information relating to
trades of the Notes that might suggest that the initial sale of a substantial portion of the Notes to the
public was at a materially higher price than the price stated for that maturity in the Certificate of Initial
Purchaser.
Bidders may bid to purchase Notes from the District with a premium; however, no bid will be
considered if the bid is to purchase Notes at an aggregate price [less than 100% or more than 102.5%] of
the aggregate principal amount of the Notes.
No bid will be accepted that contemplates the waiver of any interest or other concession by the
bidder as substitute for payment in full of the purchase price. Bids that do not conform to the terms of
this section may be rejected. See"Right to Reject Bids,Waive Irregularities"below.
*Preliminary; subject to change.
95713584.3 4
Adjustment of Principal Amounts After Receipt of Bids
The principal amount of the Notes set forth in the Official Bid Form reflects an estimate of the
District as to the likely interest rate of the winning bid and the premium contained in the winning bid.
After selecting the winning bid, the principal amount of the Notes may be adjusted in $5,000 increments,
if the District elects to do so, to reflect the actual interest rate and any premium in the winning bid to
generate a dollar amount bid of at least $ while maintaining the same "per Note"
purchaser's discount and original issue premium, if any, provided in such bid. Any such adjustment will
be communicated to the winning bidder within 24 hours after receipt of such bid by the District. Changes
in the principal amount of the Notes made as described in this paragraph will not affect the determination
of the winning bidder or give the winning bidder any right to reject the Notes.
No Insurance
THE SUCCESSFUL BIDDER SHALL NOT PURCHASE MUNICIPAL BOND INSURANCE
IN CONNECTION WITH THE NOTES.
Form of Bid
BIDS FOR LESS THAN ALL OF THE NOTES WILL NOT BE ACCEPTED. Each bid must be
on the Official Bid Form. All electronic proposals shall be deemed to incorporate the provisions of the
Official Bid Form and must be unconditional and irrevocable. In addition, each bidder is requested to
supply an estimate of the true interest cost resulting from its bid, computed as prescribed below under the
caption "Award, Delivery and Payment," which shall be considered as informative only and not binding
on either the bidder or the District. Each bid must be in accordance with the terms and conditions set
forth in this Official Notice Inviting Bids.
The District will make its best efforts to accommodate electronic bids; however, the District, the
Financial Advisor (Public Resources Advisory Group) and Special Counsel assume no responsibility for
any error contained in any electronic bid, or for the failure of any electronic bid to be transmitted or
received at the official time for receipt of such bids. The official time for receipt of bids will be
determined by the District at the place of the bid opening, and the District shall not be required to accept
the time kept by Electronic Service as the official time. The District assumes no responsibility for
informing any bidder prior to the deadline that its bid is incomplete, or not received.
If multiple timely bids are received from a single bidder the District shall accept the best of such
bids and each bidder agrees,by submitting any bid,to be bound by its best bid.
Information Regarding Electronic Proposals
Electronic proposals must be submitted through the Electronic Service. If any provision of this
Official Notice Inviting Bids conflicts with information provided by the Electronic Service, this Official
Notice Inviting Bids shall control. The District is not responsible for the proper operation of, and shall
have no liability for any delays or interruptions of or any damages caused by the Electronic Service. The
District is using the Electronic Service as a communication mechanism and not as the District's agent to
conduct electronic bidding for the Notes. The District is not bound by any advice of or determination by
the Electronic Service to the effect that any particular bid complies with the terms of this Official Notice
Inviting Bids. All costs and expenses incurred by prospective bidders in connection with their submission
of bids through the Electronic Service are the sole responsibility of such bidders and the District is not
responsible for any such costs or expenses. Further information about the Electronic Service, including
any fee charged, may be obtained from Ipreo at (877) 588-5030. The District assumes no responsibility
95713584.3 5
or liability for bids submitted through the Electronic Service. The District shall be entitled to assume that
any bid submitted through the Electronic Service has been made by a duly authorized agent of the bidder.
Bid Security Deposit
Each bidder must provide with its bid (i) a financial surety bond ("Surety Bond") in the amount
of$140,000 (the "Bid Security Deposit") issued by an insurance company rated in one of the top two
rating categories by Moody's Investors Service, Fitch Ratings or Standard & Poor's Ratings Services,
without regard to any modification of the rating, and licensed to issue such a bond in the State of
California, naming the District as the beneficiary and identifying the bidder whose deposit is guaranteed
by the Surety Bond or(ii)a wire transfer of immediately available federal funds.
Surety Bonds. If the successful bidder has provided a Surety Bond, such bidder shall wire
transfer to the District the amount of the Bid Security Deposit in immediately available federal funds not
later than 3:00 p.m. (New York Time) on the business day next succeeding the day of acceptance of the
bid, which amount shall be deposited in an escrow fund or account or a similar fund and applied to the
purchase price of the Notes at the time of delivery of the Notes. If the District has not received such
federal funds wire transfer by the time stated, the District may draw upon the Surety Bond to satisfy the
successful bidder's Bid Security Deposit requirements.
Wire Transfers. Any Bid Security Deposit wire transfers must be received in federal funds prior
to the deadline for examination of the bids, and should be directed as follows:
Union Bank,N.A.
ABA: 122000496
A/C#: 37130196431
A/C: TRUSDG
FFC: OCSD 2012C/Acct No. 67119651
The wire transfers of unsuccessful bidders will be returned promptly on the bid date after the
examination of bids. The wire transfer of the successful bidder will be retained by the District and
applied to the purchase price at the time of delivery of the Notes. The District disclaims any liability for
funds sent by wire transfer,except for any willful misconduct or reckless disregard for its duties.
If after the award of the Notes, the successful bidder fails to complete the purchase on the terms
stated in its bid,unless such failure of performance shall be caused by any act or omission of the District,
the Bid Security Deposit,whether paid by federal funds wire or pursuant to the Surety Bond procedure set
forth above, shall be retained by the District as stipulated liquidated damages. No interest will be paid
upon any Bid Security Deposit.
Official Statement
The District has approved a Preliminary Official Statement, dated October_, 2012, which the
District has "deemed final" for purposes of Rule 15c2-12 promulgated by the Securities and Exchange
Commission, as amended (the "Rule"), although subject to revision, amendment and completion in
conformity with the Rule. The District will provide the successful bidder such reasonable number of
printed copies of the final Official Statement as such bidder may reasonably request no later than seven
business days after the day the Notes are awarded. Up to 50 copies of the final Official Statement will be
furnished without cost to the successful bidder and further copies, if desired, will be made available at the
successful bidder's expense. The successful bidder shall file the final Official Statement with a nationally
recognized municipal securities information repository on a timely basis. The successful bidder shall, by
95713584.3 6
accepting the award, agree at all times to comply with the provisions of the Rule and with all applicable
rules of the Municipal Securities Rulemaking Board.
Award,Delivery and Payment
If satisfactory bids are received, the Notes will be awarded to the highest responsible bidder not
later than two hours after the time established for the receipt of bids. The highest bidder shall be the
bidder submitting the best price for the Notes, which best price shall be that resulting in the lowest true
interest cost with respect to the Notes. The true interest cost shall be computed by doubling the semi-
annual interest rate (compounded semi-annually) necessary to discount the Installment Payment from the
Maturity Date to the date of the Notes and to the price bid. If two or more bidders have bid the same true
interest cost,the award shall be made at the sole discretion of the District.
Delivery of the Notes is expected to occur on or about October 30, 2012. The Notes will be
delivered through the facilities of DTC, New York, New York. The successful bidder shall pay for the
Notes on the date of delivery in Los Angeles, California in immediately available federal funds. Any
expenses of providing federal funds shall be borne by the purchaser. Payment on the delivery date shall
be made in an amount equal to the price bid for the Notes less the amount of the bid security deposit.
Right to Reject Bids,Waive Irregularities
The District reserves the right to reject any and all bids and to the extent permitted by law to
waive any irregularity or informality in any bid.
CUSIP Numbers
It is anticipated that CUSIP numbers will be printed on the Notes,but the District will assume no
obligation for the assignment or printing of such numbers on the Notes or for the correctness of such
numbers, and neither the failure to print such number on any Note nor any error with respect thereto shall
constitute cause for a failure or refusal by the purchasers thereof to accept delivery of and make payment
for the Notes. The cost for the assignment of CUSIP numbers to the Notes will be the responsibility of
the successful bidder.
California Debt and Investment Advisory Commission
The successful bidder will be required to pay all fees due to the California Debt and Investment
Advisory Commission ("CDIAC") under California law. CDIAC will invoice the successful bidder after
the delivery of the Notes.
Legal Opinions
The District will furnish to the successful bidder at the closing of the Notes, the legal opinion of
Special Counsel to the effect that, in the opinion of Special Counsel, based upon an analysis of existing
laws, regulations,rulings and court decisions, and assuming, among other matters, the accuracy of certain
representations and compliance with certain covenants,the interest component of the Installment Payment
and the allocable portion thereof distributable in respect of each Note is excluded from gross income for
federal income tax purposes under section 103 of the Internal Revenue Code of 1986 and is not a specific
preference item for purposes of the federal alternative minimum tax and is exempt from State of
California personal income taxes. Special Counsel will express no opinion regarding any other tax
consequences related to the ownership or disposition of, or the accrual or receipt of interest on,the Notes.
95713584.3 7
Change in Tax Exempt Status
At any time before the Notes are tendered for delivery, the successful bidder may disaffirm and
withdraw its proposal if the interest on municipal securities of the same type and character as that
evidenced by the Notes (as determined by Special Counsel) shall be declared to be includable in gross
income under federal income tax laws, either by a ruling of the Internal Revenue Service or by a final
decision of any federal court, or shall be declared taxable by the terms of any federal income tax law
enacted subsequent to the date of this Official Notice Inviting Bids.
Closing Documents
The District will furnish to the successful bidder at the time of delivery of the Notes: (1)a
certificate certifying (i) that as of and at the time of delivery of the Notes, there is no action, suit,
proceeding or investigation, pending or, to the best knowledge of the District, threatened against or
affecting the District, (A) which affects or seeks to prohibit, restrain or enjoin the execution and delivery
of the Notes or the Trust Agreement, (B) in any way contesting the validity of the Notes, the Installation
Purchase Agreement or the Trust Agreement or the powers of the District to enter into or perform its
obligations under such documents to which it is a party or the existence of the District, or(C)wherein an
unfavorable decision, ruling or finding would materially and adversely affect the District, or the validity
or enforceability of the Notes, the Installation Purchase Agreement or the Trust Agreement or the ability
of the District to perform its obligations under such documents to which it is a party, (ii)that the
Preliminary Official Statement did not on the date of sale of the Notes and the Official Statement does not
on the date of delivery contain any untrue statement of a material fact or omit to state a material fact
necessary to make the statements contained therein, in the light of the circumstances under which they
were made, not misleading, and (2) a receipt of the District showing that the purchase price of the Notes
has been received by the District.
Continuing Disclosure
To assist the successful bidder in complying with the Rule, the District will undertake, pursuant
to the Continuing Disclosure Agreement, to provide notices of the occurrence of certain enumerated
events. A description of the Continuing Disclosure Agreement is set forth in the Preliminary Official
Statement and will be set forth in the final Official Statement.
Additional Information
Electronic copies of the Trust Agreement, the Installment Purchase Agreement, the Master
Agreement, this Official Notice Inviting Bids, the Official Bid Form, and the Preliminary Official
Statement will be furnished to any potential bidder upon request made to the District's Financial Advisor
at: Public Resources Advisory Group, 11500 West Olympic Boulevard, Suite 502, Los Angeles, CA
90064, 310-477-8487,via e-mail at lchoi@pragla.com.
Right to Modify or Amend
The District reserves the right to modify or amend this Official Notice Inviting Bids, including
but not limited to the right to adjust and change the principal amount of the Notes being offered;
provided, however, that such notifications or amendments shall be made not later than October ,
2012, by 4:00 p.m., New York Time and communicated through Thomson Municipal News (available at
http://www.tm3.com) and by facsimile transmission to any qualified bidder timely requesting such notice.
Bidders are required to bid for the Notes as so modified.
95713584.3 8
Cancellation or Postponement
The District reserves the right to cancel or postpone, from time to time, the date established for
the receipt of bids for any reason at any time. Any such postponement will be announced by Thomson
Municipal News. If any date fixed for the receipt of bids and the sale of the Notes is postponed, any
alternative sale date will be announced via Thomson Municipal News at least 24 hours prior to such
alternative sale date and will be provided by facsimile transmission to any qualified bidder timely
requesting such notice. On any such alternative sale date, any bidder may submit a bid for the purchase
of the Notes in conformity in all respects with the provisions of this Official Notice Inviting Bids except
for the date of sale and except for the changes announced by Thomson Municipal News at the time the
sale date and time are announced.
Dated: October ,2012
95713584.3 9
Exhibit A
Form of Initial Issue Price Certificate
92012
Orange County Sanitation District
Fountain Valley, California
Fulbright&Jaworski L.L.P.
Los Angeles, California
Ladies and Gentlemen:
We have served as the Underwriter in connection with the execution and delivery on behalf of the
Orange County Sanitation District (the "District") of$ Orange County Sanitation District
Wastewater Revenue Refunding Certificate Anticipation Notes, Series 2012C (the"2012 Notes").
We hereby certify that:
(i) , 2012 was the first day on which there was a binding contract in
writing for the sale or exchange of the 2012 Notes by the District to the Underwriter, and on that
day (the "Sale Date"), the Underwriter undertook pursuant to such contract to make a bona fide
public offering of all of the 2012 Notes. On the Sale Date all of the 2012 Notes was offered in a
bona fide initial offering to the general public at the initial offering price or initial offering yield
(the "Initial Offering Price") shown, on the cover page of the Official Statement dated
, 2012 relating to such offering (the "Official Statement"). The Initial Offering
Price represented: (i) the Underwriter's reasonable determination of a fair market value on the
Sale Date of the 2012 Notes; and (ii) the price at which the Underwriters reasonably expected to
sell all the 2012 Notes to the general public;
(ii) based upon our records and other information available to us that we believe to
be correct, the first price at which a substantial portion (but in no event less than ten percent) of
the 2012 Notes was sold by the Underwriter to the general public was the Initial Offering Price in
respect of the 2012 Notes as described above;
(iii) at the time that the Underwriter agreed to purchase the 2012 Notes, based upon
then prevailing market conditions, the Underwriter had no reason to believe that the first sale of
any of the 2012 Notes to a member of the general public would be at an initial offering price
greater than or an initial offering yield less than the fair market value thereof;
(iv) taking into account the aggregate amount of the 2012 Notes, and treating the
Initial Offering Price as the issue price of each 2011 Note, the aggregate issue price of the 2012
Notes is $ (the 2012 Notes having been sold with premium of$ ); and
(v) we provided the yield proof attached hereto as Exhibit A to Special Counsel; we
make no representations regarding its legal sufficiency.
95713584.3
For purposes of this Certificate, the term"general public" does not include bond houses, brokers,
or similar persons or organizations acting in the capacity of underwriters or wholesalers.
The undersigned understands that the statements made herein will be relied upon by the District
in its efforts to comply with the conditions imposed by the Internal Revenue Code of 1986 (the "Code"),
and will be relied upon by Special Counsel in rendering its legal opinion, concerning the exclusion from
the gross income for federal income tax purposes of interest with respect to the 2012 Notes.
[INITIAL PURCHASER],
as Underwriter
By:
Title:
2
Exhibit A
Yield Proof
(See attached)
3
OFFICIAL BID FORM
ORANGE COUNTY SANITATION DISTRICT
REVENUE REFUNDING CERTIFICATE ANTICIPATION NOTES,SERIES 2011B
52012
Orange County Sanitation District
10844 Ellis Avenue
Fountain Valley,CA 92708-7018
Attn: Lorenzo Tyner
Ladies and Gentlemen:
We hereby offer to purchase all of the $ aggregate principal amount of the Orange
County Sanitation District (the "District") Revenue Refunding Certificate Anticipation Notes, Series
2012C (the "Notes"), more particularly described in your Official Notice Inviting Bids, dated ,
2012 (the "Official Notice Inviting Bids"), which is incorporated herein by reference, and made a part
thereof, at a purchase price of$ (which purchase price is not less than[100.0%or more
than 102.5%] of the aggregate principal amount of the Notes). This offer is for Notes evidencing interest
at the rate per annum of_%.
The bid is subject to acceptance not later than two hours after the expiration of the time established for the
final receipt of bids.
Our calculation of the true interest cost, computed in accordance with the instructions in the Official
Notice Inviting Bids, and which is considered to be informative only and not a part of the bid, is
(PLEASE CHECK ONE OF THE FOLLOWING TWO PARAGRAPHS)
[ ] A surety bond has been provided to the District in the amount of$140,000 issued by an
insurance company rated in one of the top two rating categories by Moody's Investors Service, Fitch
Ratings or Standard & Poor's Ratings Services, without regard to any modification of the rating, and
licensed to issue such a bond in the State of California, naming the District as the beneficiary and
indentifying our bidding syndicate whose deposit is guaranteed by the surety bond.
[ ] With this bid we are providing the District a wire transfer in immediately available
federal funds in the amount of$140,000 to an account specified by the District or its representative, in
accordance with the Official Notice Inviting Bids.
We have noted that payment of the purchase price is to be made in immediately available Federal Funds
at the time of delivery of the Notes. If we are the successful bidder, we will (1) within 30 minutes after
being notified of the verbal award of the Notes, advise the District of the initial public offering prices of
the Notes; and (2) prior to delivery of the Notes furnish a certificate, acceptable to Special Counsel,
.Preliminary; subject to change.
95713584.3
Fulbright & Jaworski L.L.P., as to the "issue price" of the Notes in the form specified in the Official
Notice Inviting Bids.
We represent that we have full and complete authority to submit this bid on behalf of our bidding
syndicate and the undersigned will serve as the lead manager for the group if the Notes are awarded
pursuant to this bid. We certify (or declare) under penalty of perjury under the laws of the State of
California that this proposal is genuine, and not a sham or collusive, nor made in the interest of or on
behalf of any person not herein named, and that the bidder has not directly or indirectly induced or
solicited any other bidder to put in a sham bid or any other person, firm or corporation to refrain from
bidding, and that the bidder has not in any manner sought by collusion to secure for himself an advantage
over any other bidder.
Respectfully Submitted,
Account Manager:
By:
Address:
City:
State:
Telephone:
Following(or attached)is a list of the members of our account on whose behalf this bid is made.
2
FJ DRAFT
09/11/12
NOTICE OF INTENTION TO SELL
Orange County Sanitation District
Revenue Refunding Certificate Anticipation Notes
Series 2012C
NOTICE IS HEREBY GIVEN that the Orange County Sanitation District (the "District")
intends to receive sealed bids and electronic bids until 11:30 a.m.,New York time, on Thursday,
October 18, 2012,
through the use of the Parity® electronic bid submission system offered by Ipreo; at
www.newissuehome.i-deal.com and the Parity bid delivery service, for the purchase of all of the
District's Revenue Refunding Certificate Anticipation Notes, Series 2012C (the "Notes"), dated
as of the date of initial delivery, and maturing on October 30, 2013 as described in the related
Official Notice Inviting Bids (the "Notice"). No bids will be accepted by facsimile. Bids for
less than all of the Notes will not be accepted. The District reserves the right to postpone the
date established for the receipt of bids as more fully described under the paragraph "Cancellation
or Postponement" in the Notice.
NOTICE IS HEREBY FURTHER GIVEN that electronic copies of the Notice and the
Preliminary Official Statement issued in connection with the sale of the Notes may be obtained
from the District's financial advisor, Public Resources Advisory Group, 11500 West Olympic
Boulevard, Suite 502, Los Angeles, California 90064, (310) 477-8487, via e-mail:
lchoi@pragla.com.
Orange County Sanitation District
Dated: October 10, 2012
Preliminary,subject to change.
95713790.3
Return to Agenda
STEERING COMMITTEE Meeting Date To Bd. of Dir.
09/26/12 09/26/12
AGENDA REPORT Item Number Item Number
2 9
Orange County Sanitation District
FROM: James D. Ruth, General Manager
SUBJECT: General Manager's FY 2012-13 Work Plan and Report of
Accomplishments
GENERAL MANAGER'S RECOMMENDATION
Approve the General Manager's FY 2012-13 Work Plan and Report of
Accomplishments.
SUMMARY
Each year, the General Manager prepares a work plan of activities for the coming fiscal
year and reviews the plan with the Steering Committee. Additionally, a review of
accomplishments for the past year is presented. Both documents are submitted for
consideration by the Board of Directors.
PRIOR COMMITTEE/BOARD ACTIONS
None
ADDITIONAL INFORMATION
CEQA
N/A
BUDGET / DELEGATION OF AUTHORITY COMPLIANCE
N/A
ATTACHMENT
General Manager's Report of Year-End Accomplishments to the Board of Directors and
FY 2012-13 Work Plan
Page 1 of 1
GENERAL MANAGER'S
REPORT OF YEAR-END ACCOMPLISHMENTS
TO THE STEERING COMMITTEE
AND
2012-2013 PROPOSED WORK PLAN
J u LY 25, 2012
OJNty ANI Tq r y
O
2 '
Orange 9
O 1
THE EN \Po�?
Table of Contents
Fi
scal Year 2011-2012 Work Plan -Year-End Review of Accomplishments
Fiscal Year 2012-2013 Proposed Work Plan
V�'01 S A H I r T,�y
� � O
ORANGE COUNTY SANITATION DISTRICT
901 ��2
FCl/NG THE EN�\Po0 M e m o ra n d u m
DATE: July 25, 2012
TO: Chairman and Members of the Steering Committee
FROM: James D. Ruth, General Manager
SUBJECT: Fiscal Year 2011-2012 Work Plan—Year-End Review of Accomplishments
I am pleased to present for your consideration this year-end review of progress on my work plan for
Fiscal Year 2011-2012.
1. LABOR NEGOTIATION: Initiate reopeners with the OCEA and Local 501 bargaining units in
November 2011 to explore the option of a Health Reimbursement Account (HRA) as an
alternative to the current post-retirement health benefit plan, which provides eligible retirees a
monthly contribution towards the costs of health insurance for themselves and their
dependents. The focus will be to establish a defined contribution plan in lieu of a defined
benefit plan. The HRA must be mutually agreed to by the bargaining units and OCSD.
STATUS: The District and affected bargaining units reopened the HRA provisions last November
in compliance with the negotiated labor agreements. The parties did not mutually agree on a
defined contribution plan to replace the current defined benefit plan for post-retirement health
benefits. Staff will continue to pursue the HRA provision as part of our upcoming negotiations
with the Professional and Supervisory groups.
2. STRATEGIC PLAN: Staff will convene a strategic planning Board workshop in October 2011 and
bring forward for Board action a proposed update of our 5-year Strategic Plan in November.
The proposed plan will address strategic goals to support our board-approved levels of service,
new regulatory requirements, economic drivers, mitigation measures to address identified risks,
and our agreed upon work plan.
Page 1 of 10
STATUS: A strategic planning board workshop was held in October and the updated strategic
plan was unanimously approved by the Board of Directors in December 2011. Staff is making
good progress on several new strategic initiatives contained in the plan:
• Biosolids recycling -- staff made a recommendation to the Board for a land
application contractor selected through the RFP process. The Board voted to opt
out of the long-term contract with EnterTech. Staff is negotiating an agreement
with the County of Orange to utilize Prima Desheca landfill in South County as a
management option.
• Ocean protection -- studies are underway by our staff and consultants to gain an
understanding of the environmental changes occurring around our ocean outfall
and we expect to provide our recommendations to the Board in the coming year.
• Full cost recovery -- staff is working with the County of Orange and stakeholders
to implement the Board's direction to recover the costs of our urban runoff
treatment program. Staff will provide a recommendation at the annual strategic
planning workshop.
• Five year rate plan -- staff is working on a proposal that will be presented to the
Board for consideration early in 2013.
• Maintain AAA bond rating -- with the Board's strong support of our rate program,
we have been able to maintain the OCSD's AAA bond rating.
3. ADMINISTRATIVE FACILITIES MASTER PLAN: Staff will develop a comprehensive space plan
identifying space needed for staff located at the Fountain Valley site. This plan will
accommodate staff currently housed in aging office trailers and other obsolete buildings that do
not comply with current codes.
STATUS: This item is on schedule for completion. The preliminary design study for Project P1-
115 Title 24 Access Compliance Improvements at Plant 1 has been completed and information is
ready for consideration in the study of options to find the best, most economical option for
office buildings at OCSD considering 30 year present work lifecycle cost estimates. A
Professional Consulting Services Agreement has been negotiated for the comprehensive study
which is scheduled for completion in October 2012.
Page 2 of 10
4. BIOSOLIDS MANAGEMENT: Staff will work with the Board to revisit our policies on recycling
and landfilling of biosolids. Revisiting our present policies and goals may facilitate lower cost
local biosolids management options.
STATUS: This item is on schedule. The 2011 Strategic Plan was updated allowing for landfilling
up to 12% of OCSD's biosolids. An agreement with Orange County Waste & Recycling allowing
landfilling of some of OCSD's biosolids at the Prima Descheca Landfill is scheduled for approval
in August. The Request for Proposals was advertised as planned and six proposals were
received. A recommendation for awarding a contract for land application and failsafe landfilling
was presented to the Board in June 2012 and was continued to the August meeting. The
EnerTech Rialto facility did not meet the milestones in our agreements. OCSD's Board of
Directors voted to terminate the agreement in June 2012 following discussions between
EnerTech and the General Manager.
5. SECONDARY TREATMENT: This District will complete construction and commissioning of the
new Secondary Treatment facilities at Reclamation Plant No. 1 in 2012 and will achieve
compliance with the final consent decree milestone, meeting secondary treatment standards by
December 31, 2012.
STATUS: This work is on target for early completion of the EPA Consent Decree December 31,
2012 milestone. The Reclamation Plant No. 1 new secondary treatment facilities are in
commissioning and being tested with wastewater. The facility ramped up water treatment to
full design flows in June 2012 with commissioning completed in July. Final completion of the
project is scheduled for August 2012. Staff is planning a celebratory event in fall 2012 to
recognize this historic milestone.
6. TWO-YEAR BUDGET: We will soon begin the process for completing a new two-year budget for
Fiscal Years 2012-2013 and 2013-2014. Staff will ensure that all operations and financial goals
are developed according to Board direction and within budget. The new budget covers
operations and capital expenditures and scheduled debt financing and revenue adjustments as
required.
STATUS: A series of budget presentations were provided by staff between February and May,
which included a review of all District Revenues and Expenditures. The Proposed Budget for
Page 3 of 10
Fiscal Years 2012-13 and 2013-14 are $378 million and $430 million, respectively. The increase
in the second year is primarily related to an increase in the Capital Improvement Program
expenditures in 2013-14. Those expenditures will decrease in the following year. The Board of
Directors approved the final budget at the June 2012 Board meeting.
7. SUSTAINABLE ENERGY PRODUCTION: Startup of the demonstration hydrogen fuel cell unit at
Reclamation Plant No. 1 has been completed and operational performance will be evaluated
during Fiscal Year 2011-12. Demonstration testing of the central generation emission control
systems has also been completed and the design for full-scale implementation will also begin in
Fiscal Year 2011-12.
STATUS: The pilot fuel cell started operating with digester gas fuel in June 2011. Operation
until late January 2012 was intermittent due to power quality issues at the site that were not
related to the fuel cell itself. These issues appear to have been resolved. From July 2011
through March 2012, the fuel cell was online producing power for 5,357 hours, exported
539,815 kWh, and used 4,250,700 ft3 of digester gas (47% of its total fuel usage). The hydrogen
purification system has generally run well, with hydrogen purity and recovery at expected levels.
The digester gas clean-up system has not exhibited breakthrough of any trace contaminants.
The demonstration testing of emissions controls on one CenGen engine at Plant 1 proved that
the modified engine can meet the proposed limitations by the SCAQMD. A report was
submitted to the SCAQMD documenting the results and cost of implementation. The project to
implement the controls on all remaining engines will continue when SCAQMD finalizes the
emissions rules for OCSD.
8. LOCAL SEWER TRANSFERS: Based on our Strategic Plan, transfer back to cities and sanitary
districts the local sewer assets that are not serving a true regional purpose. Currently targeted
for completion in FY 2012-2013.
Complete the quitclaim and transfer process of local sewers to Tustin, Orange, and Anaheim.
Provide revised data and renew our discussions for quitclaim and transfer of sewers and pump
stations to Newport Beach. Provide preliminary data and begin discussions with Santa Ana and
Huntington Beach.
Page 4 of 10
STATUS: In Tustin, staff is working with the new City Manager to carry out the City Council's
direction to conclude the transfer of 174 miles of small diameter local sewers within Tustin and
the unincorporated areas north of the City including El Modena in the City of Orange's sphere of
influence. In Orange, we are working with City staff to conclude the transfer of 7.5 miles of
sewers. In Anaheim, City staff is evaluating several local construction projects to reroute flow
and to accommodate potential new development. OCSD staff will work with City staff as plans
firm up. In Huntington Beach, there are 27 miles of local sewers and two pump stations
proposed for transfer. As part of their due diligence process, City staff inspected the Edinger
and Slater Pump Stations and they are currently reviewing OCSD's closed circuit TV (CCTV) data,
our computerized maintenance management system (CMMS) records, and the electric and
water utility expenses for the pump stations.
In Santa Ana, City staff is performing a rate study and has included the 18 miles of sewer
proposed for transfer in their study. Additionally, City staff has indicated that they will be giving
us a list of questions to support their due diligence process. Costa Mesa Sanitary District (CMSD)
came to us this year with a new request to quitclaim to them a gravity sewer about 0.60 miles
long under Fairview Avenue north of the 405 freeway. A due diligence process by CMSD staff is
underway and the quitclaim is expected to be completed early in 2013.
In Newport Beach, at City staff's request to transfer local facilities to the City, we recently
concluded an extensive research effort to determine if OCSD was the owner of the 12-inch
diameter Vitrified Clay Pipe (VCP) sewer in the Back Bay Drive area of Newport Beach. This is
adjacent to the Newport Dunes Resort. It is evident that this sewer was never constructed or
owned by OCSD. We have advised the City and the regulatory agencies of our findings. This
sewer only serves local parcels in the City and county areas and the City collects a local sewer
service fee from those parcels connected. We also presented information to quitclaim local
sewers in the parking lot of the old Newport Nautical Museum / Reuben E. Lee. OCSD currently
owns and operates these sewers, and they serve only local facilities. Additionally, there are
another 20 miles of sewers that serve only a local purpose in addition to four pumping facilities
that we currently own and operate. The City recently advised us that it now plans to conduct a
sewer fee study for its facilities. We have asked that all the proposed asset transfers be
included in its study.
Page 5 of 10
9. WORKFORCE DEVELOPMENT: Continue to implement training programs for front-line
supervisors and other levels of the organization based on identified skill and knowledge gaps.
Consider recommendations from the Leadership Development Team formed in FY 2010-2011,
and support the implementation of newly proposed programs. Revise the onboarding process
for new supervisors and new employees to support their success. Continue to revamp the
Succession Management Program to build a sustainable culture of talent development,
addressing both organizational and employee needs and supporting the transfer of knowledge.
STATUS: Leadership Competency Gaps—50%of leadership/management personnel are eligible
to retire in the next three-years. The Leadership Development Team (LDT) identified high
quality, low cost leadership training programs for staff in support of the strategic plan initiative
for leadership development. Also, the BLAST (Building Leaders, Abilities, and Skills for
Tomorrow) program set 23 leadership competency courses that prepare staff for leadership
positions at all organizational levels.
Technical Skill Gaps—40%of staff in core wastewaterjobs are eligible to retire in the next three-
years. Targeted technical training was implemented for job specific training. Staff surveyed
workforce skill and knowledge requirements in the two-year budget process, completing the
most recent survey in April 2012. Focus is operator certification levels for class V plants and
industrial skills training for maintenance personnel.
The new supervisor and employee orientation ("on-boarding") process was revised, tailoring the
process to individual departments. A talent management system was implemented, providing
for knowledge transfer and integration of succession, learning, and performance management
programs.
10. PUBLIC EDUCATION: Staff will create a public education and outreach strategy leading up to the
Board of Directors' 2013 rate decision. The strategy will include a variety of media elements
targeted at key stakeholders who could influence this issue. Staff will work closely with the
Steering Committee to create the strategy and brief the board of directors prior to the launch of
the strategy elements in early 2012.
STATUS: Staff developed an outreach strategy in early 2012. The plan runs through the Board
discussion of rates in 2013. In March, staff presented the strategy to the Steering Committee,
Page 6 of 10
along with the new OCSD Website. Included in this plan are the strategies and target audiences.
We set a goal of attending a community event in each of the communities we serve, meeting
with each of the cities in our service area and increasing our tour and student outreach.
In the summer of 2012, staff is participating in a number of outreach events, including the Tustin
Street Fair, the Fountain Valley Summerfest and the Orange Street Fair.
In July, OCSD will host a community open house and continue outreach through the summer.
The goal of the outreach is to educate the public about who we are and what we do to protect
public health and the environment.
11. EMERGENCY PREPAREDNESS: Staff will develop business continuity procedures to ensure that
OCSD continues to operate in the event of a natural disaster, including fire, earthquake, floods,
or pandemic illnesses. Staff will also enhance plans for other business/operational events such
as the loss of source of supply, loss of critical infrastructure (a major piece of machinery or
computing/network resource), or the result of theft or vandalism.
STATUS: Recognizing the importance of OCSD's continued operations under adverse conditions,
Risk Management continues to develop a comprehensive Business Continuity Plan (BCP). This
plan will be the roadmap to recover, respond, keep our utility in business, and maintain
operations in times of crisis. There are three major components to the BCP. The Risk
Management staff recently completed the updates on both volumes of the Integrated
Emergency Response Plan (IERP), which completes the first of the three components. Risk
Management will take the lead role and partner with selected members throughout the
organization to develop a Continuity of Operations Plan and a Continuity of Government Plan to
complete the BCP.
OCSD also continues to play an active role in The Water Emergency Organization of Orange
County (WEROC), who coordinates and supports emergency response to major disasters on
behalf of Orange County Water and Wastewater Agencies. Risk Management has helped
develop a Hazard Mitigation Plan, which helps identify vulnerability and reduce disaster losses
throughout the County.
Page 7 of 10
Officials from NOAA's National Weather Service will recognize OCSD in Huntington Beach, CA,
for completing a set of rigorous guidelines necessary to earn the distinction of being
TsunamiReady°.
The TsunamiReady preparedness program helps communities develop tsunami response plans
with NOAA's National Weather Service and local emergency managers. Since the program
began in 2004, more than 80 U.S. communities have become TsunamiReady.
To achieve this distinction OCSD met rigorous criteria, which include developing a tsunami
safety plan and communications infrastructure, installation of dozens of tsunami hazard zone
and evacuation signs, as well as actively promoting tsunami safety through public awareness
activities and training.
OCSD received a separate security assessment from the Department of Homeland Security for
Plant 2, as well as the fifteen pump stations throughout Orange County. Risk Management will
review the findings and due a risk evaluation in order to determine the prioritization of the
security concerns.
12. SAFETY ENHANCEMENTS: Staff will deploy enhancements to safety program. Safety is an
important aspect of any organization. As a result of the industrial nature of the work done here
at OCSD, safety is even more important. Therefore, we will be incorporating various new safety
programs including continuous and comprehensive safety training programs. All OCSD
employees will receive safety training corresponding with their responsibility and exposure.
STATUS: Recognizing the importance of safety at OCSD, Risk Management staff are
continuously improving the current safety policies and have been implementing new policies to
better protect our employees. We have also worked with consultants to have the organizations
safety programs evaluated to ensure they are providing the proper level of protection. Based
upon the findings, Risk Management staff has made improvements in the programs. Risk
Management staff has incorporated safety requirements into performance evaluations to bring
greater emphasis to staff on the importance of safety.
Risk Management has taken over the health and wellness responsibilities from Human
Resources continuing the strong focus on the health of our employees to ensure we have a
Page 8 of 10
happy and healthy workforce. Risk Management converted an existing position to a full-time
Occupational Health Nurse to help oversee the health and wellness programs for the
organization.
OCSD engaged an external risk assessment firm to conduct an OSHA Voluntary Protection
Program (VPP) gap analysis audit. The OSHA VPP is a joint venture between OSHA, the
employer, and the employees to validate the employer meeting or exceeding all safety
regulations. The audit looked at OCSD safety policies, procedures, practices, and safety culture.
The audit was conducted during the week of May 23rd and lasted for four days. Risk
Management Staff is working with the VPP Sub-Committee to address the findings. We are
looking to submit an application for VPP review in August.
13. OCEAN OUTFALL REPAIR: Staff will complete the planning, California Environmental Quality Act
process, Coastal Development Permitting, design, and construction of repairs to the OCSD S-
mile ocean outfall by winter of 2012.
STATUS: This work has made tremendous progress in a short time and is on schedule. The
Environmental Impact Report (EIR) required by the CEQA process was certified by the Board of
Directors in February and the design was completed in March 2012. Contractor Bids were
received in May and the Board of Directors approved award of the construction contract in June.
The Regional Board approved the new Ocean Discharge Permit allowing for temporary use of
the standby short outfall for maintenance of the long outfall. The project timeline is extremely
critical and work in the outfall should begin in September 2012, with the use of the standby
outfall for approximately 4 weeks. There are still significant risks with the work, but it appears
that the work remains on schedule at this time.
14. DIVERSITY INITIATIVE: Provide additional training opportunities for all levels of the organization
to continue to promote the value of diversity. Require new supervisors to complete diversity
training such as "Living the Core Values" prior to assuming their new responsibilities. Continue
to advertise job openings on various websites that attract applicants who are representative of
the community we serve. Staff will continue to build an infrastructure that appreciates the
diversity of employees and the increasingly changing workforce, and will work to provide
opportunities to provide a work place in which all people are treated equally.
Page 9 of 10
STATUS: The diversity initiative involves diversity change strategies. Activities planned and/or
implemented so far during the period include the following:
• "Living the Core Values" —Acted on the added value that diversity brings and reducing
bias through understanding.
• New supervisor orientation — Key points of the District's Core Values related to diversity
awareness provided prior to taking on supervisory assignment.
• Ethics AB 1234 compliance/mandated sexual harassment training— Mandatory training
targeted for March that incorporates learning objectives that focus on diversity.
• Employee resource groups (ERG) — Provides positive diversity related change strategies
aimed at creating a more inclusive work environment and supporting a culture of
diversity.
• Employment opportunities — Posted on various websites that ensure equal access to
District jobs, including the State of California's Employment Development Department.
• Promoted 5 women into leadership positions over the past 6 years.
15. TRANSITION PLAN: The General Manager, working in conjunction with the Steering Committee
and the Board of Directors, will prepare and submit a Transition Plan for his successor by March
1, 2012.
STATUS: At the direction of the Steering Committee, a transition plan is in place to move Jim
Herberg, currently Director of Engineering, into the position of General Manager, when I leave
OCSD. The transition plan envisions my departure from OCSD on April 1, 2013, at which time
Jim Herberg will take over as General Manager. In the meantime, we are conducting an
executive search to find a new Director of Engineering with the goal of having this person in
place in January 2013 to provide some overlap before Jim Herberg takes on his new role as
General Manager.
JDR:mrs
Page 10 of 10
V�'01 S A H I r T,�y
� � O
ORANGE COUNTY SANITATION DISTRICT
901 ��2
FCl/NG THE EN�\Po0 M e m o ra n d u m
DATE: July 25, 2012
TO: Chairman and Members of the Steering Committee
FROM: James D. Ruth, General Manager
SUBJECT: Fiscal Year 2012-2013 Proposed Work Plan
I am pleased to present my work plan for Fiscal Year 2012-2013. 1 have identified 15 areas that
I will focus on during the year including strategic planning, labor and budget, operational issues,
and workforce development. The goals listed in this plan are for Steering Committee review
prior to presenting to the full Board.
1. LABOR NEGOTIATIONS: Conduct labor negotiations with the Supervisor and
Professional groups over successor labor agreements that expire June 30, 2013, in
compliance with the Meyers-Milias-Brown Act.
2. PUBLIC OUTREACH: Undertake aggressive public education and outreach efforts
leading up to June 2013 Board vote on rates.
3. RATE PROPOSAL: Recommend a rate program for Board approval no later than June
2013.
4. SECONDARY TREATMENT: Complete commissioning of secondary treatment by the
December 31, 2012 consent decree deadline and optimize the various treatment
processes considering cost, compliance, and GWRS requirements. Conduct a
celebratory event in fall 2012 to recognize this historic milestone.
Page 1 of 3
5. OCEAN PROTECTION AND DISINFECTION: Complete water quality studies and
recommend a solution for improving environmental conditions around the ocean
outfall.
6. TRANSITION PLAN: Successfully implement the Steering Committee's General Manager
transition plan by April 1, 2013.
7. SAWPA ARBITRATION: Working with General Counsel, aggressively pursue successful
outcome on SAWPA's arbitration claim.
8. LOCAL SEWER TRANSFERS: Complete the transfer of local sewers to member agencies
and cities, focusing on completion of the Tustin transfer.
9. TRANSPARENCY: In response to Grand Jury recommendations, complete upgrades to
OCSD website to enhance transparency related to compensation and benefits
information and undertake performance audits of various programs.
10. WORKFORCE PLANNING AND DEVELOPMENT: Continue to develop comprehensive
workforce planning and development activities that improve workforce capability,
adaptability, efficiency, and accountability, and that address employee turnover and
retirements.
11. SAFETY AND SECURITY: Working with the Department of Homeland Security, conduct a
thorough assessment of our emergency preparedness planning and fill identified gaps,
including business continuity planning, and security upgrades to treatment plants and
pump stations.
12. STRATEGIC PLAN: Conduct a strategic planning Board workshop in October 2012 and
prepare the annual update of the 5-year strategic plan in December 2012 with a critical
review of our levels of service.
Page 2 of 3
13. CHEMICAL SUSTAINABILITY: Continue efforts to ensure strategic positioning in the
market by creating competitive markets for chemicals and reducing utilization of
chemicals.
14. CAPITAL IMPROVEMENT PROGRAM: Continue the transition from expansion to
rehabilitation in our CIP program, with a focus on completing key projects including SARI
line, secondary treatment, and beach box repair. Integrate supplemental CIP program
staffing through Jacobs Engineering project management consulting services.
15. ADMINISTRATIVE FACILITIES MASTER PLAN: Complete a comprehensive study of space
planning needs by October 2012 and implement recommendations for access
compliance improvements and office building options.
JDR:mrs
Page 3 of 3
Return to Agenda
OPERATIONS COMMITTEE Meeting Date To Bd.of Dir.
09/05/12 09/26/12
AGENDA REPORT Item Number Item Number
2 11
Orange County Sanitation District
FROM: James D. Ruth, General Manager
Originator: Jim Herberg, Assistant General Manager
Project Manager: Martin Dix
SUBJECT: ROCKY POINT PUMP STATION, CONTRACT NO. 5-50
GENERAL MANAGER'S RECOMMENDATION
Approve a Non-Exclusive Access Agreement, in a form approved by General Counsel,
with the Newport Beach Veterinary Hospital to access a portion of the Sanitation
District's property.
SUMMARY
In 2004, the Orange County Sanitation District (Sanitation District) purchased real
property located at 1700-2000 West Coast Highway in the City of Newport Beach
(OCSD Property) from International Bay Clubs, Inc. (IBC), for the purpose of
constructing a replacement for the outdated Rocky Point Pump Station.
The Newport Beach Veterinary Hospital (Hospital) claims that pursuant to an agreement
with IBC, the Hospital was permitted to use a small strip of land in the rear portion of Lot
61, located on Tract No. 1210, which is within the OCSD Property, for the purpose of
walking animals (Access Area). Following the transfer of OCSD Property from IBC to
the Sanitation District in 2004, the Hospital continued to use the Access Area for the
purpose of walking animals.
Staff recently became aware of the Hospital's continued use of the Access Area. The
purpose of the Non-Exclusive Access Agreement is to memorialize the duties and
obligations of the parties with respect to the Hospital's use of the Access Area.
The proposed Non-Exclusive Access Agreement between the Sanitation District and the
Hospital would allow the Hospital to continue to use the Access Area only for the limited
purposes identified until either party terminates the agreement or the Sanitation District
sells the property.
PRIOR COMMITTEE/BOARD ACTIONS
September 2007 — Approved the Purchase Option Agreement with CCCD and OCC
regarding Rocky Point Pump Station Site, in a form approved by General Counsel.
December 2005 — (1) Approved a Memorandum of Understanding between CCCD and
the Sanitation District in connection with the replacement of the Rocky Point Pump
Station, Contract No. 5-50; and (2) authorized the General Manager to negotiate with
Page 1 of 2
CCCD concerning the sale, lease, or transfer and eventual use of the unused portion of
the Rocky Point Pump Station property at 1700-2000 West Coast Highway.
October 2004 — Approved the Purchase and Sale Agreement and Joint Escrow
Instructions for the real property located at 1700-2000 West Coast Highway between
the Sanitation District and International Bay Clubs, Inc.
December 2001 — (1) Authorized the General Manager to negotiate with CCCD to
establish a joint project agreement to be approved by the Board of Directors in
connection with the Replacement of the Rocky Point Pump station; and (2) authorized
the General Manager to negotiate with International Bay Clubs, Inc. for the purchase of
real properties located at 1700 to 2000 West Coast Highway, Newport Beach for the
replacement of the Rocky Point Pump Station.
ADDITIONAL INFORMATION
The design and construction of the Rocky Point Pump Station left a portion of the OCSD
Property available for other uses. Specifically, staff has assessed the remaining unused
portion of the OCSD Property, and has determined that Lots 61 , 62, 63, 64, and 65 of
OCSD Property located on Tract No. 1210, are no longer necessary for the Sanitation
District's use (Excess Property). Staff is in the process of surveying the Excess
Property and evaluating the Sanitation District's alternatives with respect to the Excess
Property.
CEQA
The recommended action is statutorily exempt from CEQA under Sections 15060 and
15378 of the CEQA Guidelines because the action will not result in a direct or
reasonably foreseeable indirect physical change in the environment.
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 28).
Date of Approval Contract Amount Contingency
N/A N/A N/A
ATTACHMENT
The following attachment(s) may be viewed on-line at OCSD website with complete agenda package and
attachments:
( Non-Exclusive Access Agreement
JH:MD:dm:gc
Page 2 of 2
NON-EXCLUSIVE ACCESS AGREEMENT
THIS ACCESS AGREEMENT ("Agreement") is made and entered into as of September
2012 ("Effective Date") between JEFFREY COHEN, DB/A NEWPORT BEACH
VETERINARY HOSPITAL ("Hospital"), and ORANGE COUNTY SANITATION DISTRICT
("OCSD"). Hospital and OCSD are individually or collectively referred to herein as the "Party"
or the "Parties." This Agreement is made with reference to the following facts:
A. OCSD owns real property located at 1700-2000 West Coast Highway in the City
of Newport Beach, California ("OCSD Property"), which includes Lot 61 located on Tract No.
1210; and
B. OCSD purchased the OCSD Property in 2004 from International Bay Clubs, Inc
("IBC"); and
C. OCSD intends to declare as surplus and dispose of portions of the OCSD Property
sometime within the near future, including all or some portions of Lot 61 located on Tract No.
1210; and
D. Hospital is the tenant of property located at 1610 West Pacific Coast Highway in
the City of Newport Beach, California ("Hospital Property"), which is immediately adjacent to
the OCSD Property; and
E. Hospital asserts that pursuant to an agreement with IBC, Hospital was permitted
to use a small strip of land in the rear portion of Lot 61 located on Tract No. 1210 for the purpose
of walking animals; and
F. Following the sale of the OCSD Property by IBC to OCSD, Hospital continued to
use the rear portion of Lot 61 located on Tract No. 1210 for the purpose of walking animals; and
G. OCSD is agreeable to allowing Hospital to use the rear portion of Lot 61 located
on Tract No. 1210 for the sole purpose of walking animals until OCSD sells the surplus OCSD
Property, and the Parties intend to memorialize the duties and obligations of each of the Parties
as set forth herein.
NOW, THEREFORE, in consideration of the mutual obligations, representations, and promises
contained in this Agreement, Hospital and OCSD hereby agree as follows:
1. Grant of Access. OCSD hereby grants Hospital (and its employees) temporary
non-exclusive access to enter into and upon the rear portion of Lot 61 located on Tract No. 1210
outlined in red on Exhibit "A" attached hereto and incorporated herein by reference ("Access
Area") for the purpose of walking animals. Hospital shall not interfere with OCSD's operation
and use of the OCSD Property, if any, to the maximum extent possible.
2. Term. This Agreement shall commence on the Effective Date and shall terminate
867865.1
either upon five (5) day's written notice by either Party of such termination or upon the sale of
the OCSD Property, including all or a portion of Lot 61 located on Tract No. 1210, whichever
occurs first.
3. Safety and Site Condition. Hospital shall conduct its operations in a safe manner
in compliance with all laws, including, but not limited to, environmental laws, and shall
cooperate in maintaining the site in a safe, clean and orderly condition. Hospital agrees that it
will maintain no nuisance on the OCSD Property and will not allow odors or noise to
unreasonably impact neighboring properties. Upon the termination of this Agreement, Hospital
shall restore the Property to as close to the same condition as before the commencement of the
Agreement to the maximum extent feasible to the reasonable satisfaction of OCSD.
4. Sole Cost of Hospital. Hospital agrees that any and all use at, near, beneath or
related to the OCSD Property shall be at the sole cost and expense of Hospital. Hospital, at its
sole cost, is responsible for the lawful disposal of all materials, matters and other by-products it
brings onto the property. Hospital agrees to reimburse OCSD for the actual costs, if any, to
maintain or clean up Lot 61 located on Tract No. 1210 that arises out of the use by Hospital.
5. Insurance. Hospital shall, during the term of this Agreement and at all times
during which access to Lot 61 located on Tract No. 1210 is available to Hospital, maintain
insurance with the following coverage:
(i) Workers Compensation with statutory limits; and
(ii) Commercial General Liability, with $2,000,000 single limit or equivalent .
Hospital shall cause OCSD to be named as an additional insured on the Commercial General
Liability insurance policy and shall provide OCSD with a certificate of said policies. Said
policies shall remain in effect during the term of this Agreement.
6. Limited Access. Hospital agrees that entry upon OCSD Property shall be limited
to the extent necessary or desirable for the purposes expressed in this Agreement.
7. Temporary Access. This Agreement is intended and shall be construed as a
temporary authorization to access and enter upon the OCSD Property, and not as a grant of
easement or any other interest in the Property. Except as expressly set forth herein, no other
rights are created by this Agreement. Hospital expressly understands and acknowledges that
OCSD intends to sell and dispose of all or portions of Lot 61 located on Tract No. 1210
sometime in the near future, and such sale of the property shall terminate Hospital's access
granted herein.
8. Indemnity. Except to the extent arising out of the negligence or willful
misconduct of OCSD, Hospital agrees to indemnify, defend, save and hold harmless OCSD, its
partners, agents, officers, members and representatives against all losses, costs, expenses and
damages suffered or incurred by Hospital, and the beneficiaries, employees, officers, members
and agents of Hospital, caused by OCSD's approval of this Agreement or by Hospital's activities
related to this Agreement, including the activities of its agents and representatives.
867865.1
9. As-Is. In entering the Property, Hospital accepts the Property conditions as may
exist from time to time without any representation or warranty of OCSD, and without any duty
of OCSD to warn of any conditions. Hospital acknowledges and understands that the Hospital's
use of the Property is non-exclusive and that the Property may be accessed by OCSD licensees,
invitees, employees, agents, or representatives. Accordingly, except to the extent arising out of
the negligence or willful misconduct of OCSD, Hospital agrees to assume all risks associated
with entry and presence on the OCSD Property and releases OCSD from any and all liability that
might arise from the condition of the property.
10. Attorneys' Fees. If either of the Parties is required to engage an attorney and
institute an action in order to enforce any of the provisions of this Agreement, the prevailing
Party shall be entitled to reasonable attorneys' fees, expert witness fees and court costs which
may be incurred in connection therewith.
11. Binding on Successors. This Agreement shall be binding upon the Parties to this
Agreement and their respective successors, representatives, heirs and assigns.
12. No Waiver. It is further understood and agreed that no failure or delay in
exercising any right, power or privilege hereunder shall operate as a waiver thereof, nor shall any
single or partial exercise thereof preclude any other or further exercise thereof or the exercise of
any right, power or privilege hereunder. Any waiver of any of the rights of either Party
hereunder must be in a writing signed by the Party waiving such right(s).
13. Assignability. Hospital shall not assign this Agreement nor any rights hereunder
without the prior written consent of OCSD, which may be given or withheld in OCSD's sole and
absolute discretion.
14. Choice of Law. The terms of this Agreement shall be construed pursuant to the
laws of the State of California.
15. Entire Agreement. This Agreement constitutes the entire agreement and
understanding between the Parties pertaining to this subject matter and supersedes all prior or
contemporaneous agreements and understanding, both written and oral, pertaining to the subject
matter hereof.
16. Interpretation. This Agreement will be interpreted according to the fair meaning
of its terms and not strictly for or against any Parry hereto.
17. Modification. The provisions of this Agreement may only be amended, modified
or waived by written agreement executed by both Parties. Each person signing warrants that
they have the authority to bind the party.
18. Severability. If any provision of this Agreement is held to be invalid or
unenforceable for any reason, the remaining provisions shall continue in full force and effect
without being impaired or invalidated in any way.
19. Notice. All notices or other documents (collectively "notices") given hereunder
867865.1
shall be in writing and shall be addressed to the recipient and sent by personal delivery or United
States certified mail, postage prepaid. Unless and until otherwise notified, the address of each of
the parties for the giving of Notices shall be:
If to Hospital:
Newport Beach Veterinary Hospital
Attn: Debra Cohen
1610 West Coast Highway
Newport Beach, CA
If to OCSD:
Orange County Sanitation District
Attn: Martin Dix
10844 Ellis Avenue
Fountain Valley, CA 92708
IN WITNESS WHEROF, the parties have executed this Agreement on the date set forth below
their respective signatures.
ORANGE COUNTY SANITATION DISTRICT Dated:
APPROVED AS TO FORM:
By: By:
Troy Edgar Bradley R. Hogin
Its: Chair of the Board of Directors Its: General Counsel
HOSPITAL Dated:
JEFFREY COHEN D/B/A
NEWPORT BEACH VETERINARY
HOSPITAL
867865.1
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Return to Agenda
OPERATIONS COMMITTEE Meeting Date To Bd. of Dir.
09/05/12 09/26/12
AGENDA REPORT Item Number Item Number
3 12
Orange County Sanitation District
FROM: James D. Ruth, General Manager
Originator: Nick Arhontes, P.E., Director of Facilities Support Services
Engineering Manager: Mark Esquer, P.E., Facilities Support Services
Project Manager: MarcoPolo Velasco, PMP, Facilities Support Services
SUBJECT: REGIONAL ODOR AND CORROSION CONTROL SERVICES,
SPECIFICATION NO. C-2012-524BD
GENERAL MANAGER'S RECOMMENDATION
A. Approve Amendment No.1 to the Agreement with Hill Brothers Chemical Company,
for Regional Odor and Corrosion Control Services, Specification No. C-2012-524BD,
to include emergency and backup services options, for calcium nitrate, unit price
$3.35 per gallon plus tax, $100 freight per delivery, and service fee $1,500 per
station per day operating (maximum 48 hours); for magnesium hydroxide at a unit
price $580 per dry ton plus tax, $385 freight per delivery, and service fee $1,500 per
station per day operating (maximum 48 hours); for the period July 1 , 2012 through
June 30, 2013 with four one-year renewal options; and
B. Approve Amendment No.1 to the Agreement with Hill Brothers Chemical Company,
for Regional Odor and Corrosion Control Services, Specification No. C-2012-524BD,
to include a $100 per hour demurrage fee for mobile dosing upon request for
magnesium hydroxide at a unit price $580 per dry ton plus tax, $385 freight per
delivery (maximum 48 hours); for the period July 1 , 2012 through June 30, 2013 with
four one-year renewal options.
SUMMARY
This amendment provides additional clarification regarding the terms of the contract for
services. Mobile backup services are utilized for odor control during short-term
activities where no continuous chemical dosing station at a fixed site can treat the
specific downstream location needing odor or corrosion control. In the past, this service
has been utilized during inspection, maintenance, and repair activities in the collection
system, as well as at the treatment plants on occasion. Emergency services may also
be utilized in the event of a regional or national chemical supply shortage or delivery
stoppage. In the past, this has been a rare occurrence, only two times over a 10-year
period, caused by events such as hurricanes damaging production facilities or national
transit routes. Management approval in advance is required to use these service
options.
Page 1 of 2
PRIOR COMMITTEE/BOARD ACTIONS
June 2012 — The Board approved contracts with U.S. Peroxide, LLC, and to Hill
Brothers Chemical Company for Regional Odor and Corrosion Control Services,
Specification No. C-2012-52413D, and approved an annual unit price and program price
contingency of 15%, per contract.
July 2010 — The Board approved change orders to contracts with U.S. Peroxide, LLC,
and to Hill Brothers Chemical Company for Regional Odor and Corrosion Control
Services, Specification No. C-2009-40513D, and approved a 15% annual unit price
contingency.
May 2009 — The Board approved contracts with US Peroxide, LLC, and to Hill Brothers
Chemical Company for Regional Odor and Corrosion Control Services, Specification
No. C-2009-40513D, and approved a 10% annual unit price contingency.
June 2008 — The Board approved a sole source contract with US Peroxide, LLC, for the
application of a proprietary chemical process which uses hydrogen peroxide
regenerated iron for odor and corrosion control, and approved a 10% unit cost
escalation contingency.
ADDITIONAL INFORMATION
Management of odor and corrosion is a part of the services that OCSD provides to
comply with our Strategic Plan and Levels of Service. It also helps extend the life of our
assets. The regional trunk line odor and corrosion control program reduces sulfides
associated with odor generation and structural degradation caused by corrosion within
the facilities. In addition, treatment in the regional trunks provides a secondary benefit
of minimizing hydrogen sulfide and odors in the local communities and the treatment
plants. Staff maintains oversight of these service providers with daily interaction at our
remote dosing facilities as well as program planning, adding dosing locations when
needed, as well as a detailed review of all invoices prior to recommending approval for
payment.
CEQA
N/A
BUDGET / DELEGATION OF AUTHORITY COMPLIANCE
This complies with authority levels of the Sanitation District's Delegation of Authority.
This item has been budgeted (FY2012-123 Budget in Division 340, Line Items 58, 60,
61).
Page 2 of 2
AMENDMENT NO. 1
Regional Odor and Corrosion Control Services (ROCCS)
Specification No. C-2012-524BD
THIS AMENDMENT TO THE AGREEMENT is made and entered into, to be effective as of September
26, 2012 by and between Orange County Sanitation District hereinafter referred to as "OCSD" with main offices
located at 10844 Ellis Avenue, Fountain Valley, California 92708-7018 and Hill Brothers Chemical Company
with main offices located at 15017 East Clark Avenue, Industry, CA 91745 hereinafter referred to as "Company"
collectively referred to as "the Parties".
WHEREAS, OCSD and Company executed, delivered and entered into the Agreement between OCSD
and Company, the effective date of which is July 1, 2012 ("the Agreement"); and
WHEREAS, the Parties wish to amend the Agreement to make certain modifications which shall be
called Amendment No. 1 ("Amendment'); and
WHEREAS, on September 26, 2012, the Board of Directors of OCSD, by minute order, authorized execution of
this Amendment between OCSD and Company; and
WHEREAS, the Parties to the Agreement desire that this Amendment be incorporated into the
Agreement and become a part thereof from the beginning; and
WHEREAS, the Parties desire that the Agreement as modified by this Amendment shall constitute the
sole and entire Agreement among the Parties;
NOW, THEREFORE, in consideration of these premises and the mutual covenants contained herein,
the Parties agree to amend the Agreement to:
1. Include emergency and backup services options, for calcium nitrate, unit price $3.35 per gallon plus tax,
$100 freight per delivery, and service fee $1,500 per station per day operating (maximum 48 hours); for
magnesium hydroxide at a unit price $580 per dry ton plus tax, $385 freight per delivery, and service fee $1,500
per station per day operating (maximum 48 hours); and
2. Include a $100 per hour demurrage fee for mobile dosing upon request for magnesium hydroxide at a
unit price $580 per dry ton plus tax, $385 freight per delivery (maximum 48 hours).
The Agreement and changes above are effective July 1, 2012 through June 30, 2012 with four
optional one-year renewal periods. Except as expressly amended above, the Agreement will remain
unchanged and in full force and effect.
IN WITNESS WHEREOF, intending to be legally bound, the Parties hereto have caused this
Amendment No. 1 to be signed by the duly authorized representatives as of the day and year last signed below.
Orange County Sanitation District Hill Brothers Chemical Company
By:
Contracts/Purchasing Manager Date Date
Name:
Chairman, Board of Directors Date
Title:
Clerk of the Board Date
OCSD
As to form
cmm 9/20/12
Return to Agenda
ADMINISTRATION COMMITTEE Meeting Date To Bd. of Dir.
09/12/12 09/26/12
AGENDA REPORT Item Number Item Number
2 14
Orange County Sanitation District
FROM: James D. Ruth, General Manager
Originator: Lorenzo Tyner, Director of Finance and Administrative Services
GENERAL MANAGER'S RECOMMENDATION
Receive and file report of reimbursements to Board Members and Staff per Government
Code 53065.5 for the period July 1, 2011 through June 30, 2012.
SUMMARY
Government Code Section 53065.5 requires all Special Districts to disclose any
reimbursements paid by the Sanitation District within the immediately preceding fiscal
year of at least one hundred dollars ($100) or more for each individual charge for
services or product received. The individual charge includes, but is not limited to, tuition
reimbursement, certificate or license reimbursement, or meals, lodging, and
transportation, or registration fee reimbursed to any employee or member of the
governing body of the Sanitation District. The disclosure requirement shall be fulfilled
by including the reimbursement information in a document published or printed at least
annually by a date determined by that district and shall be made available for public
inspection.
Attached is the report of these reimbursements for the fiscal year ended June 30, 2012.
PRIOR COMMITTEE/BOARD ACTIONS
N/A
ATTACHMENTS
1. Report of reimbursements per Government Code 53065.5 for the period
July 1 , 2011 through June 30, 2012.
JDR:LT:MW/jmf
Page 1 of 1
Orange County Sanitation District
Government Code 53065.5, Public Disclosure Reports - Reimbursements by OCSD
July 1, 2011 Through June 30, 2012
Employee Name Title Amount Invoice Comments Site/Location Duration
Alter, Marian M. Principal Accountant 110.00 MEMBERSHIP CSMFO 2013
Ambriz, Juan J. Environmental Technician 440.70 CWEA SEMINAR Primm, NV 9/26/11-9/30/11
Amezcua, Gerardo loperations Supervisor 1 190.00 ICERT REIMBURSEMENT 2012
Amezcua, Gerardo loperations Supervisor 1 821.39 IREIMB FOR TRAINING ISacramento, CA 4/17-4/20/12
Amin, Anantkumar R. Electrical Tech II 360.00 REIMB FOR CERT
Amin, Anantkumar R. Electrical Tech II 108.00 TUITION REIMBURSEMENT
Anderson, John S. Board of Directors 301.07 REIMB FOR TRAVEL Sacramento, CA 6/20/12
Andrade, David Senior Mechanic 132.00 CWEA MEMB RENEWAL 2012
Andresen, Larry S. Plant Operator 130.00 WASTEWTER CERT GRADE 2
Arhontes, Nicholas J. IDir of Facilities Support Svcs 1 125.76 JWEFTEC 2011 ILos Angeles, CA 10/16-10/18111
Arhontes, Nicholas J. IDir of Facilities Support Svcs 1 518.46 JWEF MIDYR MTG 2012 INew Orleans, LA 1/26-29/12
Armstrong, Jeffrey L. Environmental Supervisor 124.84 WEFTEC UTILTY CONF 2011 Los Angeles, CA 10/15-19/11
Armstrong, Jeffrey L. Environmental Supervisor 1,218.05 CERF 2011 Daytona Beach, FL 11/06-11/11/11
Ayala, Maria E. Clerk of the Board 296.00 REIMB FOR TRAINING Monterey, CA 2/29-3/03/12
Ayala, Maria E. Clerk of the Board 402.87 REIMB FOR TRAINING Riverside, CA 3/13-3/16/12
Ayala, Maria E. Clerk of the Board 941.00 REIMB FOR TRAINING Sacramento, CA 4/9-4/13/12
Ayala, Maria E. Clerk of the Board 1 1,366.75 IREIMB FOR TRAINING jPortland, OR 5/20-5/25/12
Barrett, Michael J. ISenior Plant Operator 1 190.00 JWSTEWATER TRMT CERT GRID 5
Barwick, Kelvin L. Pr Environmental Specialist 318.95 SCAMIT MTG Santa Barbara, CA 3/19-20/12
Barwick, Kelvin L. Pr Environmental Specialist 200.70 REVISION GONIADIDAE BOOK
Basrai, Shabbir S. Senior Engineer 483.31 SITE VISIT Salt Lake City, UT 9/21-9/22/11
Basrai, Shabbir S. Senior Engineer 267.62 RESRCH WEIR SPECIAL PUMPS Salt Lake City, UT 3/13-14/12
Basrai, Shabbir S. Sr. Engineer 729.00 TUITION REIMBURSEMENT
Bauer II, Wesley G. ISafety Et Health Supervisor 1 150.00 JCSP CERT RENEW 2012
Bauer II, Wesley G. ISafety Et Health Supervisor 1 120.00 JOHST CERT RENEWAL 2012
Berdis, Michael A. Operations Supervisor 1 190.00 IGRADE V CERT RENEW 2013
Biele, Catherine M. Senior Plant Operator 170.00 WSTEWATER TRMT CERT 3
Biele, Catherine M. Senior Plant Operator 567.66 TRISTATE CONF Primm, NV 9/26/11-9/29/11
Bihl, David A. Plant Operator 130.00 GRADE II CERT RNWL 2013
Birdsell, Richard S. Senior Engineer 523.18 REIMB FOR TRAINING St. Louis, MO 6/21-6/23/11
Blair, Bryan E. IMechanic 1 132.00 JCWEA RENEWAL 2011
Boess, Michael J. ISenior Plant Operator 1 190.00 ICERT REIMBURSEMENT
Page 1 of 15
Orange County Sanitation District
Government Code 53065.5, Public Disclosure Reports - Reimbursements by OCSD
July 1, 2011 Through June 30, 2012
Employee Name Title Amount Invoice Comments Site/Location Duration
Boyd, Mark S. Plant Operator 193.80 OFFICE CHAIR
Bradley Jr., Jon 0. Senior Plant Operator 170.00 GRADE III CERT RENEW 2013
Bradley Jr., Jon 0. ISenior Plant Operator 1 250.00 IGRADE V EXAM
Bradley Jr., Jon 0. ISenior Plant Operator 1 190.00 IWASTEWATER OP GRADE V
Bradley Jr., Jon 0. Sr. Plant Operator 1,029.41 TUITION REIMBURSEMENT
Bradley Jr., Jon 0. Sr. Plant Operator 1,350.00 TUITION REIMBURSEMENT
Bradley Jr., Jon 0. Sr. Plant Operator 1,300.00 TUITION REIMBURSEMENT
Brandvold, Anne H. Senior Info Tech Analyst 121.06 REIMB FOR TRAINING Irvine, CA 6/6-6/10/11
Brandvold, Anne H. Senior Info Tech Analyst 538.06 REIMB FOR MEETING San Diego, CA 7/26-7/28/11
Brandvold, Anne H. ISr. Info Tech Analyst 1 895.00 ITUITION REIMBURSEMENT
Brooks, Rebecca A. jEngineer 1 170.00 JCPEA 2013
Brown, Marc A. Principal Staff Analyst 1,025.69 NAT'L ASSOC OF GOV Albuquerque, NM 9/11/11-9/15/11
Brown, Michael C. Environmental Technician 1,575.00 TUITION REIMBURSEMENT
Brown, Peter H. Senior Plant Operator 170.00 WSTEWATER TRMT CERT 3
Buonacorsi, Curtis Plant Operator 170.00 WASTE TRMT CERT GRADE 3
Burror, James L. Engineering Supervisor 405.00 BCEE 2013
Burror, James L. jEngineering Supervisor 1 379.19 IWATERUSE CONF ISacramento, CA 3/25-27/12
Burror, James L. jEngineering Supervisor 1 320.00 JWEF MEMB FEES 2012
Burror, James L. Engineering Supervisor 180.00 2012 MEMBERSHIP FEE
Burror, James L. Engineering Supervisor 323.04 MAXIMO GROUP Mesa, AZ 11/7/11-11/9/11
Cabral, Jennifer M. Sr. Public Affairs Specialist 119.10 FEB2012 MILEAGE
Cady, Pongsakdi Principal Info Tech Analyst 106.74 MS-50400 DESIGN Irvine, CA 6/11/12
Cady, Pongsakdi Principal Info Tech Analyst 821.66 REIMB FOR TRAINING Phoenix, AZ 11/7-11/10/11
Carnahan, Patrick B. ISafety Et Health Specialist 1 150.00 jSCBA REFILL CARD
Carrillo, Dindo A. ISr Environmental Specialist 969.31 1 EPA WORSHOP lWashington DC 7/13-16/11
Carrillo, Dindo A. ISr Environmental Specialist 623.08 1 CWEA TRNG Isacramento, CA 4/18-4/20/12
Carrillo, Dindo A. Sr Environmental Specialist 132.00 REIMB FOR CWEA MEMBERSHIP
Cassidy, William D. Engineering Supervisor 1,156.25 CWEA CONF Sacramento, CA 4/16-4/20/12
Cassidy, William D. Engineering Supervisor 125.00 MECHANICAL ENGNR CER 2014
Castillon, Richard A. IT Syst Et Operations Manager 586.89 CIO FORUM Seattle, WA 4/30/12
Castillon, Richard A. I IT Syst Et Operations Manager 1 910.87 IREIMB FOR MEETING IMonterey, CA 10/1-10/4/11
Castillon, Richard A. I IT Syst Et Operations Manager 1 911.33 ISTORGE EVAL SITE VISITS ISeattle, WA 2/26/12 - 3/1/12
Page 2 of 15
Orange County Sanitation District
Government Code 53065.5, Public Disclosure Reports - Reimbursements by OCSD
July 1, 2011 Through June 30, 2012
Employee Name Title Amount Invoice Comments Site/Location Duration
Castro, Ernesto Lead Plant Operator 190.00 WASTEWATER GRADE V LICENS
Castro, Ernesto Lead Plant Operator 173.42 TUITION REIMBURSEMENT
Castro, Ernesto ILead Plant Operator 1 237.77 ITUITION REIMBURSEMENT
Chafe, David M. lReliability Maint Technician 1 1,101.67 JANALYSIS COURSE lKnoxvitte, TN 5/13/12
Chavez, Frank Operations Supervisor 164.55 REIMB FOR TRAINING Los Angeles, CA 10/17-10/19/11
Choi, Yeom Senior Engineer 125.00 CIVIL ENGINEER RENEW 2014
Chong, Tatiana Staff Analyst 1,590.00 TUITION REIMBURSEMENT
Chong, Tatiana Staff Analyst 480.00 TUITION REIMBURSEMENT
Chong, Tatiana Staff Analyst 1,710.00 TUITION REIMBURSEMENT
Chong, Tatiana IStaff Analyst 1 1,710.00 ITUITION REIMBURSEMENT
Christensen, Kimberly C. ISenior Scientist 1 1,380.07 IREIMB FOR MEETING I Boston, MA 11/12-11/17/11
Cleveland, Donald R. Lead Mechanic 537.90 REIMB FOR TRAINING Primm, NV 9/26-9/30/11
Collins, Rodney L. Senior Safety Et Health Rep 569.48 IX VPPPA CONF Monterey, CA 4/2-4/5/12
Collins, Rodney L. Senior Safety Et Health Rep 629.63 REIMB FOR TRAINING San Diego, CA 10/10-10/13/11
Collins, Rodney L. Senior Safety Et Health Rep 165.00 REIMB FOR ABIH CERT
Collins, Rodney L. Senior Safety Et Health Rep 175.00 REIMB FOR SAFETY CERT
Colston, James E. jEnviron Compl-Reg Affairs Mgr 1 838.42 INACWA SUMMER CONF IChicago, IL 7/19-22/11
Colston, James E. jEnviron Compl-Reg Affairs Mgr 1 110.00 INACWA CONFERENCE ILos Angeles, CA 2/13/12
Colston, James E. Environ Compl-Reg Affairs Mgr 280.95 REIMB FOR STAFF LUNCHEON
Colston, James E. Environ Compl-Reg Affairs Mgr 370.00 REIMB FOR STATE BAR MEMB
Colston, James E. Environ Compl-Reg Affairs Mgr 235.64 STAFF APPREC LUNCH
Colston, James E. Environ Compl-Reg Affairs Mgr 873.39 CASA CONFERENCE Napa, CA 4/25-4/27
Colston, James E. Environ Compl-Reg Affairs Mgr 559.55 REIMB FOR MEETING Charleston, SC 11/15-11/18/11
Cortez, Ronald C. ISenior Plant Operator 1 190.00 IGRADE V CERT RENEW 2013
Coss, Ronald J. lEnvironmentat Lab Et OM Manager 1 1,331.28 IREIMB FOR MEETING lPhoenix, AZ 11/12-11/16/11
Coss, Ronald J. jEnvironmental Lab Et OM Manager 1 386.52 JELOM MTG LUNCH ITEMS
Coss, Ronald J. Environmental Lab Et OM Manager 493.00 REIMB FOR WEF MEMBERSHIP
Coss, Ronald J. Environmental Lab Et OM Manager 231.00 REIMB FOR AWWA MEMBSHP
Crafton, Ann Principal Financial Analyst 182.08 REIMB FOR SEPT MILEAGE
Crafton, Ann Principal Financial Analyst 19.10 REIMB FOR SEPT MILEAGE
Grafton, Ann jPrincipal Financial Analyst 1 36.27 IMILEAGE 042012
Grafton, Ann lPrincipat Financial Analyst 1 176.18 IMILEAGE 042012
Page 3 of 15
Orange County Sanitation District
Government Code 53065.5, Public Disclosure Reports - Reimbursements by OCSD
July 1, 2011 Through June 30, 2012
Employee Name Title Amount Invoice Comments Site/Location Duration
Crandall, Larry R. Board of Directors 1,111.79 CASA CONF San Diego, CA 8/10-12/11
Crandall, Larry R. Board of Directors 949.55 REIMB FOR CASA CONF Desert Springs, CA 1/17-1/20/12
Crandall, Larry R. 113oard of Directors 1 610.38 ICASA CONFERENCE INapa, CA 4/25-4/27
Crandall, Larry R. jBoard of Directors 1 400.19 1 ADVOCACY TRIP ISacramento, CA 6/20/12
Crandall, Larry R. Board of Directors 353.66 REIMB FOR CSDA CONF Monterey, CA 10/12/11
Crandall, Larry R. Board of Directors 740.59 REIMB FOR WEFTEC CONF Los Angeles, CA 10/17-10/19/11
Crandall, Larry R. Board of Directors 1,544.58 CASA CONF Washington DC 3/11-3/14/12
Criscuolo, Keith W. Senior Plant Operator 190.00 WASTEWATER CERT GRADE V
Cuellar, Raul Engineer 125.00 PE LICENSE 2013
Dao, Chloe D. ISenior Engineer 1 125.00 ICHEM ENGINEER CERT 2012
DaSilva, Andy jEngineer 1 125.00 ICIVIL ENGNR LICENSE 2013
DaSilva, Andy Engineer 298.00 CWEA MEMB 2013
DeVries, Patrick Thys Human Resources Analyst 1,703.99 TUITION REIMBURSEMENT
DeVries, Patrick Thys Human Resources Analyst 1,590.00 TUITION REIMBURSEMENT
DeVries, Patrick Thys Human Resources Analyst 310.89 TUITION REIMBURSEMENT
DeVries, Patrick Thys Human Resources Analyst 1,710.00 TUITION REIMBURSEMENT
DeVries, Patrick Thys lHuman Resources Analyst 1 1,784.90 ITUITION REIMBURSEMENT
Dhodia, Hemal linformation Tech Analyst III 1 275.00 JELECTRICAL ENGINEER EXAM
Dhodia, Hemal Information Tech Analyst III 125.00 PE RENEWAL 2013
Diaz, Arturo Senior Laboratory Analyst 132.00 REIMB FOR MEMBERSHIP
Dillon, Carla D. Engineering Supervisor 125.00 CIVIL ENGINEER CERT 2013
Dillon, Carla D. Engineering Supervisor 853.05 WEF ODOR AIR POLL 2012 4/14-18/12 4/14-18/12
DoDderer, Thomas D. Lead Plant Operator 515.82 TRISTATE CONF Primm, NV 9/26-9/29/11
DoDderer, Thomas D. ILead Plant Operator 1 190.00 JWSTEWATER TRMT CERT GRID 4
Dubois, Marcus lContract It Purchasing Manager 1 507.03 ICAPPO 2012 11ndian Wells, CA 1/11-13/12
Edgar, Troy D. jBoard of Directors 1 825.78 ICASA CONF ISan Diego, CA 8/10-12/11
Edgar, Troy D. Board of Directors 674.20 REIMB FOR CASA CONF Desert Springs, CA 1/18-1/20/12
English, Roy C. Maintenance Specialist 379.00 REIMB FOR REGISTRATION Online training 7/22-8/22/11
Escobar, Santiago A. Associate Engineer 1,287.08 ROTORDYNAMICS COURSE Houston, TX 3/5/12-3/9/12
Esquer, Mark A. Engineering Manager 122.45 EMP RECOGNITN LUNCH 5/11/11
Esquer, Mark A. jEngineering Manager 1 255.00 JASCE MEMB RENEW 2012
Esquer, Mark A. jEngineering Manager 1 619.83 JCWEA CONF ISacramento, CA 4/17-4/20/12
Page 4 of 15
Orange County Sanitation District
Government Code 53065.5, Public Disclosure Reports - Reimbursements by OCSD
July 1, 2011 Through June 30, 2012
Employee Name Title Amount Invoice Comments Site/Location Duration
Esquer, Mark A. Engineering Manager 259.97 SCAP MTG Santa Barbara, CA 5/7/12
Esquer, Mark A. Engineering Manager 823.44 REIMB FOR MEETING New Orleans, LA 1/23-1/29/12
Evangelista, Jerry F. jEngineering Supervisor 1 209.00 JAICHE MEMBERSHIP 2012
Evangelista, Jerry F. jEngineering Supervisor 1 768.57 1 NACWA CONF
Evangelista, Jerry F. Engineering Supervisor 125.00 CHEMICAL ENGINEER 2014
Evans, Theresa Contract/Purchasing Assistant 1,805.00 TUITION REIMBURSEMENT
Evans, Theresa Contract/Purchasing Assistant 1,805.00 TUITION REIMBURSEMENT
Falkenstein, John B. Engineer 125.00 CIVIL ENGINEER CERT 2013
Farmer, Michele Pr. Environmental Specialist 1,296.06 TUITION REIMBURSEMENT
Farmer, Michele jPr. Environmental Specialist 1 2,109.64 ITUITION REIMBURSEMENT
Farmer, Michele jPr. Environmental Specialist 1 2,008.18 ITUITION REIMBURSEMENT
Ferguson, Victor M. Instrumentation Tech II 186.00 REIMB FOR ISA MEMBERSHIP
Ferraro, Benjamin J. Laboratory Assistant 2,460.00 TUITION REIMBURSEMENT
Ferraro, Benjamin J. Laboratory Assistant 2,495.00 TUITION REIMBURSEMENT
Fields, Jeanie M. Executive Assistant 184.58 SPECIAL STAPLER
Fisher, Dean M. Engineering Manager 567.26 CWEA CONF Sacramento, CA 4/18-4/22/12
Flores, John M. ISr. Construction Inspector 1 189.37 ITUITION REIMBURSEMENT
Flores, John M. ISr. Construction Inspector 1 218.46 ITUITION REIMBURSEMENT
Forman, Chuck M. Facilities Manager 376.26 FLEET BEST MEETING Denver, CO 6/18-6/21/12
Forman, Chuck M. Facilities Manager 231.43 REIMB FOR TRAINING Virginia BH, VA 10/16-10/19/11
Francis, Victoria L. Senior Engineer 125.00 PE LICENSE RENEW 2013
Francis, Victoria L. Senior Engineer 220.81 REIMB FOR TRAINING Phoenix, AZ 9/7-9/8/11
Francis, Victoria L. Senior Engineer 1,087.28 WEFTEC MTG New Orleans 1/25/12-1/29/12
Gadzinski, Joscelynn M. I Plant Operator 1 170.00 ICERT REIMBURSEMENT
Gadzinski, Joscelynn M. Plant Operator 1 250.00 IGRADE IV CERT REIMB.
Gadzinski, Joscelynn M. Plant Operator 1 190.00 ICERT REIMBURSEMENT 2012
Gadzinski, Joscelynn M. Plant Operator 1,199.52 TUITION REIMBURSEMENT
Gadzinski, Joscelynn M. Plant Operator 247.07 TUITION REIMBURSEMENT
Gadzinski, Joscelynn M. Plant Operator 835.36 TUITION REIMBURSEMENT
Gadzinski, Joscelynn M. Plant Operator 876.31 TUITION REIMBURSEMENT
Gadzinski, Joscelynn M. Plant Operator 1 193.95 ITUITION REIMBURSEMENT
Gadzinski, Joscelynn M. Plant Operator 1 1,307.50 ITUITION REIMBURSEMENT
Page 5 of 15
Orange County Sanitation District
Government Code 53065.5, Public Disclosure Reports - Reimbursements by OCSD
July 1, 2011 Through June 30, 2012
Employee Name Title Amount Invoice Comments Site/Location Duration
Gadzinski, Joscelynn M. Plant Operator 1,195.60 TUITION REIMBURSEMENT
Gallegos, Richard Plant Operator 120.00 GRADE 1 OPERATOR CERT
Gamber, Robert M. ISr Environmental Specialist 1 2,118.49 IREIMB FOR MEETING I Boston, MA 11/13-11/17/11
Gamber, Robert M. ISr. Environmental Specialist 1 2,212.82 ITUITION REIMBURSEMENT
Gamber, Robert M. Sr. Environmental Specialist 2,567.15 TUITION REIMBURSEMENT
Gamber, Robert M. Sr. Environmental Specialist 2,281.00 TUITION REIMBURSEMENT
Garchow, Matthew N. Senior Info Tech Analyst 1,908.36 REIMB FOR TRAINING Wilmington, DE 11/27-12/8/11
Gasca, Luis Electrical Tech II 100.00 GENERAL ELECTRICIAN 2015
Ghirelli, Robert P. Assistant General Manager 1,064.51 CASA CONF San Diego, CA 8/10-13/11
Ghirelli, Robert P. lAssistant General Manager 1 265.96 ICASA CONFERENCE INapa, CA 4/25-4/27
Pirelli, Robert P. lAssistant General Manager 1 650.52 IREIMB FOR MEETING IDesert Springs, CA 1/18-1/20/12
Gold, Michael I. Public Affairs Manager 1,102.19 CASA CONF San Diego, CA 8/10-13/11
Gold, Michael I. Public Affairs Manager 499.12 CASA CONFERENCE Napa, CA 4/25-4/27
Gold, Michael I. Public Affairs Manager 681.35 REIMB FOR TRAINING Palm Desert, CA 1/18-1/20/12
Gold, Michael I. Public Affairs Manager 232.66 REIMB FOR RECEPT. DESK
Gold, Michael I. Public Affairs Manager 374.00 REIMB FOR ICONS WEBSITE
Gold, Michael I. IPublic Affairs Manager 1 224.12 JOUTREACH EVENT SUPPLIES
Gold, Michael I. iPubtic Affairs Manager 1 206.61 JOUTREACH BOOTH SUPPLIES
Gomez, Ruben Senior Construction Inspector 809.72 REIMB FOR TRAINING Philadelpha, PA 10/30-11/03/11
Gonzalez, John G. Maintenance Supervisor 266.00 REIMB FOR TRAINING Primm, NV 9/26-9/30/11
Hall, Brent M. Maintenance Worker 135.00 REIMB FOR CWEA CERT
Haney, Lisa K. Sr Environmental Specialist 455.00 CASQA CONFERENCE Anaheim, CA 8/21-8/25/11
Haney, Lisa K. Sr Environmental Specialist 785.95 REIMB FOR MEETING Monterey, CA 9/25-9/28/11
Haney, Lisa K. ISr Environmental Specialist 1 150.00 ICESSWI APPLICATION FEE
Hannappel, Rick J. iMateriats Control Supervisor 1 221.89 IREIMB FOR LUNCH
Harting, Michael H. jEngineer 1 125.00 IRENEW PE LICENSE 2013
Haworth, Michael T. Lead Plant Operator 190.00 GRADE IV WASTEWATER CERT
Haworth, Michael T. Lead Plant Operator 785.39 REIMB FOR TRAINING Sacramento, CA 4/17-4/20/12
Heinz, David R. Operations Manager 161.40 APPRECIATION LUNCH
Heinz, David R. Operations Manager 551.08 REIMB FOR TRAINING Sacramento, CA 4/18-4/20/12
Heinz, David R. loperations Manager 1 168.60 IREIMB FOR TRAINING Sacramento, CA 4/18-4/20/12
Hendy, Thomas S. ISenior Plant Operator 1 170.00 ICERT REIMBURSEMENT
Page 6 of 15
Orange County Sanitation District
Government Code 53065.5, Public Disclosure Reports - Reimbursements by OCSD
July 1, 2011 Through June 30, 2012
Employee Name Title Amount Invoice Comments Site/Location Duration
Herberg, James D. Assistant General Manager 684.03 CASA CONF 2012 San Diego, CA 8/11-13/11
Herberg, James D. Assistant General Manager 388.97 REIMB FOR MEETING Palm Desert, CA 1/18-1/19/12
Hernandez, Kenneth L. Risk Manager 1 935.71 IREIMB FOR TRAINING IMonterey, CA 2/14-2/17/12
Hernandez, Kenneth L. Risk Manager 1 1,231.96 IPRIMA CONFERENCE INashvitte, TN 6/2-6/6/12
Hoang, Tyler T. Lead Plant Operator 190.00 WASTEWTR TRMT GRADE V
HoR, Martin A. Associate Engineer 142.24 CWEA SEMINAR Primm, NV 9/28/11-9/29/11
Hopkins, Tim H. Senior Mechanic 143.75 REIMB FOR BBQ
Hopkins, Tim H. Senior Mechanic 132.00 REIMB FOR CWEA MEMBERSHIP
Hsiao, Lina Accounting Supervisor 638.20 JDE FIX ASSET TRNG Dallas, TX 10/24-27/11
Hsiao, Lina jAccounting Supervisor 1 132.88 JGFOA TRNG Long Beach, CA 1/23-1/27/12
Hsiao, Lina jAccounting Supervisor 1 111.11 IMILEAGE 2011
Hsieh, Eric S. Principal Info Tech Analyst 250.43 QUESTWEST JDE CONF San Diego, CA 8/16-8/17/11
Huts, Michael R Plant Operator 130.00 GRADE II WASTEWATER CERT
Huts, Michael R Plant Operator 195.00 CERT REIMBURSEMENT 2012
Huts, Michael R Plant Operator 100.00 TUITION REIMBURSEMENT
Hunt, Thomas A. Lead Plant Operator 190.00 CERT REIMBURSEMENT
Jones, Larry J. ICMMS Technician II 1 292.88 ITUITION REIMBURSEMENT
Kanis, Douglas ISr. Engineer 1 2,644.04 ITUITION REIMBURSEMENT
Kanis, Douglas Sr. Engineer 2,605.96 TUITION REIMBURSEMENT
Kawamoto, Mark H. Engineer 125.00 PE CHEM ENG CH
Kawamoto, Mark H. Engineer 220.00 WEF RENEWAL 2013
Khublall, Hardat S. CIP Project Manager 125.00 RENEW CIVIL ENG LIC 2013
Khublall, Hardat S. CIP Project Manager 154.00 REIMB FOR PMI MEMBERSHIP
Kim, Igor Plant Operator 1 190.00 ICERT REIMBURSEMENT
Kim, Jin H. jEngineer 1 105.92 JWEFTEC 2011 ILos Angeles, CA 10/15-19/11
Kleinbergs, Mila S. jEngineer 1 125.00 IPE LICENSE RENEW 2013
Klinger, Laurie J. Sr Human Resources Analyst 150.00 REIMB FOR CERTIFICATION
Klinger, Laurie J. Sr Human Resources Analyst 160.94 REIMB FOR TRAINING San Jose, CA 5/8-5/9/12
Koester, Pamela A. CIP Project Manager 119.00 REIMB FOR PMI MEMBERSHIP
Koester, Pamela A. CIP Project Manager 220.00 REIMB FOR WEF MEMB
Kogan, Vladimir A. ISenior Scientist 1 595.07 JAIR I* WASTE MTG jOrtando, FL 6/20/11-6/24/11
Kogan, Vladimir A. ISenior Scientist 1 1,029.68 IREIMB FOR MEETING Louisville, KY 4/14-4/20/12
Page 7 of 15
Orange County Sanitation District
Government Code 53065.5, Public Disclosure Reports - Reimbursements by OCSD
July 1, 2011 Through June 30, 2012
Employee Name Title Amount Invoice Comments Site/Location Duration
Kyi, May T. Assistant Engineer 127.10 REIMB FOR BOOKS
Lahlou, Michael Associate Engineer 1,393.47 MECH PE REV COURSE 2011 7/10-9/25/11
Lambert , Marcus G. Electrical Tech II 1 100.00 IGENERAL ELECTRICIAN 2015 1 16/28/12-6/28/15
Lambertz, Marcus G. Electrical Tech II 1 150.00 IGRADE II CERT 2012
Lapus, Ludwig Sr. Contracts Administrator 1,650.00 TUITION REIMBURSEMENT
Lapus, Ludwig Sr. Contracts Administrator 825.00 TUITION REIMBURSEMENT
Larkin, Michael D. Engineering Supervisor 125.00 CIVIL ENGINEER CERT 2014
Larson, Marc A. Operations Supervisor 190.00 GRADE V CERTIFICATE 2014
Lechner, Jesse J. Plant Operator 130.00 GRADE II CERTIFICATE
Lee, Tony S. IChief Plant Operator 1 190.00 ICERT REIMBURSEMENT
Lee, Tony S. IChief Plant Operator 1 102.50 ISTAFF APPRECIATION FOOD
Lee, Tony S. Chief Plant Operator 1,016.22 CWEA CONF Sacramento, CA 4/17-4/20/12
Liang, Jian Sr. Info Tech Analyst 409.20 TUITION REIMBURSEMENT
Liang, Jian Sr. Info Tech Analyst 3,358.59 TUITION REIMBURSEMENT
Liang, Jian Sr. Info Tech Analyst 4,141.73 TUITION REIMBURSEMENT
Linares, Hector R. Instrumentation Tech II 105.00 GRADE D5 OPERATOR 2015
Lindel, Deborah L. IScientist 1 112.20 IMISC LAB SUPPLIES
Lindel, Deborah L. IScientist 1 220.00 JWEF MEMBER RENEWAL
Linde[, Deborah L. Scientist 123.75 LAB SUPPLIES MAY 2012
Lockyer, Vincent S. Lead Plant Operator 190.00 GRADE IV CERT RENEW 2013
Lockyer, Vincent S. Lead Plant Operator 190.00 GRADE V CERTIFICATE
Lopez, John M. Plant Operator 170.00 WASTEWTR TRMT GRADE 3 CER
Lorrimer, Ludolph T. Maintenance Supervisor 175.22 P2 STAFF LUNCH
Lorrimer, Ludolph T. Imaintenance Supervisor 1 186.94 ISTAFF APPREC LUNCH
Lorrimer, Ludolph T. IMaintenance Supervisor 1 324.06 ISTAFF APPREC LUNCH
Losurdo, Linda lAdministrative Assistant 1 244.43 IREIMB FOR BBQ LUNCHES
Luna, Lourdes Human Resources Assistant 79.39 TUITION REIMBURSEMENT
Luna, Lourdes Human Resources Assistant 182.80 TUITION REIMBURSEMENT
Malik, William S. Electrical Tech II 148.59 CERT REIMBURSTMENT
Manning, David Planner/Scheduler 764.98 TUITION REIMBURSEMENT
Mansell II, Selwyn D. ISenior Plant Operator 1 170.00 ICERT. REIMBURSEMENT
Manzella, Joseph ISr. Laboratory Analyst 1 2,534.31 ITUITION REIMBURSEMENT
Page 8 of 15
Orange County Sanitation District
Government Code 53065.5, Public Disclosure Reports - Reimbursements by OCSD
July 1, 2011 Through June 30, 2012
Employee Name Title Amount Invoice Comments Site/Location Duration
Manzella, Joseph Sr. Laboratory Analyst 922.61 TUITION REIMBURSEMENT
Manzella, Joseph Sr. Laboratory Analyst 506.28 TUITION REIMBURSEMENT
Manzella, Joseph ISr. Laboratory Analyst 1 517.59 ITUITION REIMBURSEMENT
Manzella, Joseph ISr. Laboratory Analyst 1 517.59 ITUITION REIMBURSEMENT
Maravilla, Laura Sr Human Resources Analyst 100.00 PROF HR CERT RENEWAL 2013
Markus, Stephen M. Plant Operator 170.00 GRADE III CERTIFICATE
Markus, Stephen M. Plant Operator 87.39 TUITION REIMBURSEMENT
Markus, Stephen M. Plant Operator 110.04 TUITION REIMBURSEMENT
Markus, Stephen M. Plant Operator 111.55 TUITION REIMBURSEMENT
Markus, Stephen M. I Plant Operator 1 112.55 ITUITION REIMBURSEMENT
Martinez, Denise M. ISr. Human Resources Analyst 1 (39.23) ITUITION REIMBURSEMENT
Martinez, Denise M. Sr. Human Resources Analyst (39.23) TUITION REIMBURSEMENT
Martinez, Denise M. Sr. Human Resources Analyst (39.23) TUITION REIMBURSEMENT
Martinez, Denise M. Sr. Human Resources Analyst (39.23) TUITION REIMBURSEMENT
Martinez, Denise M. Sr. Human Resources Analyst (39.23) TUITION REIMBURSEMENT
Martinez, Denise M. Sr. Human Resources Analyst (39.21) TUITION REIMBURSEMENT
Mauter, Theodore M. loperations Supervisor 1 190.00 IGRADE IV CERT RENEW 2013
McMullin, Ryan Laboratory Analyst 365.98 ENVIRNMNTL STAT TRNG 2012 ISan Diego, CA 3/26-28/12
McMullin, Ryan Laboratory Analyst 875.91 TUITION REIMBURSEMENT
McMullin, Ryan Laboratory Analyst 2,702.06 TUITION REIMBURSEMENT
McMullin, Ryan Laboratory Analyst 2,536.73 TUITION REIMBURSEMENT
Mengel, Michael J. Pr Environmental Specialist 418.71 INTRO ENVIRONMTL STATS San Diego, CA 03/26-28/12
Menocal, Jorge Senior Mechanic 304.72 TRISTATE 2011 Primm, NV 9/26/11-9/29/11
Menocal, Jorge ISenior Mechanic 1 180.00 JCWEA TECH CERT GRADE 4
Meregillano, Tom B. I Regulatory Specialist 1 106.00 ITRITAC MTG 10aktand, CA 12/08-09/11
Meregillano, Tom B. Regulatory Specialist 1 357.40 IREIMB FOR MEETING Isan Leandro, CA 7/14/11
Michaels, Robert Information Tech Supervisor 382.17 REIMB FOR MEETING San Diego, CA 7/11-7/12/11
Miranda, Faviola Sr. Public Affairs Specialist 108.28 MILEAGE
Moinuddin, Riaz K. Engineering Supervisor 125.00 PE LICENSE RENEWAL 2013
Moline, William M. Operations Supervisor 190.00 WSTEWATER TRMT CERT GRID 5
Morgan, Sonja W. 1Pr. Public Affairs Specialist 1 244.80 ISOCIAL MEDIA CONF I Las Vegas, NV 2/14-2/16/12
Morgan, Sonja W. jPr. Public Affairs Specialist 1 756.54 ICAPIO CONF 2012 Palm Springs, CA 4/17-20/12
Page 9 of 15
Orange County Sanitation District
Government Code 53065.5, Public Disclosure Reports - Reimbursements by OCSD
July 1, 2011 Through June 30, 2012
Employee Name Title Amount Invoice Comments Site/Location Duration
Morgan, Sonja W. Pr. Public Affairs Specialist 132.75 SUPPLIES KTLA NEWSCAST
Morgan, Sonja W. Pr. Public Affairs Specialist 143.24 NEW LOOK MTG SNACKS
Morgan, Sonja W. 1Pr. Public Affairs Specialist 1 301.73 12011 HOLIDAY DECOR/LUNCH
Morgan, Sonja W. 1Pr. Public Affairs Specialist 1 869.32 1CONFERENCE jAustin, TX 9/6/11-9/23/11
Morris, Robert M. Senior Plant Operator 170.00 WSTEWATER TRMT CERT 3
Mullins, James C. Senior Engineer 326.37 SITE INVESTIGATION Salt Lake City 9/21/11-9/22/11
Murphy, Tracey L. Power Plant Operator II 130.00 GRADE II WASTEWATER CERT
Murphy, Tracey L. Power Plant Operator II 132.00 2012 CWEA MEMBERSHIP
Murthy, Umesh N. CIP Project Manager 150.00 REIMB FOR CERT.
Murthy, Umesh N. ICIP Project Manager 1 150.00 ISCAQMD CPP RENEWAL 2013
Newsom, Adam P. ISenior Mechanic 1 250.00 IMOBUS INST VIBRAT LEVEL I
Nguyen, Washington Q. Engineer 2,571.35 IEEE CPS MTG Louisville, KY 5/20-25/12
Nguyen, Washington Q. Engineer 125.00 PE LICENSE RENEWAL 2013
Niswonger, James D. Construction Insp Supervisor 1,030.00 WESTERN STATE CORR SEM Pomona, CA 4/25-4/27
Niswonger, James D. Construction Insp Supervisor 836.13 SAFETY TRNG Philadelphia, PA 10/30-11/03
Oswald, Nicholas Electrical Tech II 491.08 REIMB FOR LUNCH
Oswald, Nicholas Electrical Tech II 1 312.41 IREIMB FOR LUNCH
Oswald, Nicholas Electrical Tech II 1 1,805.00 ITUITION REIMBURSEMENT
Oswald, Nicholas Electrical Tech II 1,805.00 TUITION REIMBURSEMENT
Oswald, Nicholas Electrical Tech II 1,640.00 TUITION REIMBURSEMENT
Park Jr., Joseph W. Maintenance Supervisor 150.00 SMRP LICENSE 2013
Park Jr., Joseph W. Maintenance Supervisor 299.55 CWEA CONF 2012 Sacramento, CA 4/17-22/12
Park Jr., Joseph W. Maintenance Supervisor 1,111.14 MAXIMO GROUP Mesa,AZ 11/6/11-11/11/11
Patel, Madankumar B. ISenior Engineer 1 125.00 IPE LICENSE RENEWAL 2013
Patel, Purvi R. Information Tech Analyst II 1 142.24 IMICROSOFT TRAINING lirvine, CA 10/3-10/7/11
Patel, Purvi R. Information Tech Analyst II 1 144.02 IMS LYNC SERVER 2010 lirvine, CA 3/19-23/12
Patel, Samir Information Tech Analyst II 920.00 TUITION REIMBURSEMENT
Patel, Sejal Engineer 125.00 CERT. REIMBURSEMENT
Peckham, Kevin R. Plant Operator 130.00 WSTEWATER TRMT CERT 2
Pelletier, Steven D. Maintenance Specialist 360.00 GRADE III CERT 2013
Peterson, Philip jPr. Staff Analyst 1 725.00 ITUITION REIMBURSEMENT
Philips, David N. ISenior Engineer 1 1,437.03 JCWEA CONF 2012 ISacramento, CA 4/18-20/12
Page 10 of 15
Orange County Sanitation District
Government Code 53065.5, Public Disclosure Reports - Reimbursements by OCSD
July 1, 2011 Through June 30, 2012
Employee Name Title Amount Invoice Comments Site/Location Duration
Philips, David N. Senior Engineer 775.00 WEFTEC 2011 Los Angeles, CA 10/17/11-10/19/11
Phonsiri, Vanh Principal Laboratory Analyst 1,317.90 REIMB FOR TRAINING Boston, MA 7/10-7/15/11
Phuong, Ddaze ILead Plant Operator 1 170.00 IGRADE III CERT RENEW 2013
Phuong, Ddaze ILead Plant Operator 1 250.00 IGRADE IV CERT EXAM
Phuong, Ddaze Lead Plant Operator 190.00 GRADE IV CERT 2013
Puccio, Michael Engineering Supervisor 485.18 REIMB FOR TRAINING St. Louis, MO 6/21-6/23/11
Rampley, Alexander J. CMMS Technician II 1,740.00 TUITION REIMBURSEMENT
Rampley, Alexander J. CMMS Technician II 3,610.00 TUITION REIMBURSEMENT
Rampley, Alexander J. CMMS Technician II 1,640.00 TUITION REIMBURSEMENT
Rathert, Kurt M. Plant Operator 1 170.00 JWSTEWATER TRMT CERT GRID 3
Rebai, Mathew D. Plant Operator 1 130.00 IGRADE II CERTIFICATE
Rech, Doug E. Senior Mechanic 302.00 CWEA SEMINAR Primm, NV 9/26/11-9/30/11
Redman, Lynn L. CMMS Technician I 125.00 MECHANICAL ENGINEER 2012
Redman, Lynn L. CMMS Technician I 190.00 GRADE V CERT RENEW 2013
Reed, Jeffrey T. Director of Human Resources 708.30 2012 PUBLIC SECTOR CONF San Francisco 2/1/12-2/3/12
Reynolds, Roy J. Maintenance Supervisor 169.00 CWEA CONF 2012 Sacramento, CA 4/17-20/12
Reynolds, Roy J. Imaintenance Supervisor 1 1,175.00 ITUITION REIMBURSEMENT
Reynolds, Roy J. IMaintenance Supervisor 1 1,225.00 ITUITION REIMBURSEMENT
Reynolds, Roy J. Maintenance Supervisor 1,250.00 TUITION REIMBURSEMENT
Rivera, George Security/Emerg Ping Specialist 779.63 CESA 2011 CONFERENCE San Diego, CA 10/1-10/7/11
Roberts, Mark S. Operations Supervisor 151.00 CWEA CERT 1
Robertson, George L. Senior Scientist 199.45 REIMB FOR NERISSA PARTS
Robertson, George L. Senior Scientist 664.00 MEMBERSHIP 2012 RENEWALS
Robertson, George L. ISenior Scientist 1 209.41 ITRAILER RENTAL
Robertson, George L. ISenior Scientist 1 555.56 1 SCCOOS MTG Danville, CA 6/03-07/12
Rocha, Johnny J. ISenior Plant Operator 1 250.00 IGRADE V CERTIF EXAM
Rogers, Lisa Accountant 261.20 TUITION REIMBURSEMENT
Rogers, Lisa Accountant 336.42 TUITION REIMBURSEMENT
Ross, Kelly L. Sr. Laboratory Analyst 1,390.00 TUITION REIMBURSEMENT
Ross, Kelly L. Sr. Laboratory Analyst 695.00 TUITION REIMBURSEMENT
Rothbart, Lisa A. Environmental Supervisor 220.00 WEF MEMBERSHIP 2012
Rothbart, Lisa A. Environmental Supervisor 1 704.67 ICASA CONF. Palm Desert, CA 1/18-1/20/12
Page 11 of 15
Orange County Sanitation District
Government Code 53065.5, Public Disclosure Reports - Reimbursements by OCSD
July 1, 2011 Through June 30, 2012
Employee Name Title Amount Invoice Comments Site/Location Duration
Rothbart, Lisa A. Environmental Supervisor 913.92 CASA CONF 2012 Napa, CA 4/25-27/12
Rothbart, Lisa A. Environmental Supervisor 462.59 CASA CONFERENCE San Diego, CA 8/11/11-8/13/11
Rothbart, Lisa A. lEnvironmentat Supervisor 1 425.00 ICASA CONFERENCE ISan Diego, CA 8/11/11-8/13/11
Ruckman, Ernest S. ISenior Laboratory Analyst 1 329.98 JENVIRON STATS TRNG ISan Diego, CA 3/26-28/12
Ruckman, Ernest S. Engineering Manager 972.86 TUITION REIMBURSEMENT
Ruckman, Ernest S. Engineering Manager 2,752.48 TUITION REIMBURSEMENT
Ruckman, Ernest S. Engineering Manager 2,534.00 TUITION REIMBURSEMENT
Ruiz, Stefanie R. Office Assistant 107.50 QTR STAFF MTG LUNCH
Rulison, Doug Senior Info Tech Analyst 672.76 REIMB FOR TRAINING San Diego, CA 7/11-7/13/11
Rulison, Doug jSenior Info Tech Analyst j 2,334.00 jAUTODESK UNIV 2011 j Las Vegas, NV 11/28/11-12/2/11
Ruth, James D. IGenerat Manager 1 609.82 ICSDA CONFERENCE IMonterey, CA 10/12-10/14/11
Ruth, James D. General Manager 699.77 CASA CONF Desert Springs, CA 1/18-1/20/12
Ruth, James D. General Manager 1,060.58 REIMB FOR MEETING San Diego, CA 8/10-8/13/11
Sabri, Julian F. Engineering Supervisor 125.00 REIMB FOR CERTIFICATION
Sabri, Julian F. Engineering Supervisor 180.00 REIMB FOR CERT
Sakamoto, Ken A. Sr Environmental Specialist 1,963.04 SETAC NORTH AMERICA 2012 Boston, MA 11/12-17/11
Sakamoto, Ken A. ISr Environmental Specialist 1 183.12 IREIMB FOR SCAMIT ISanta Barbara, CA 3/20/12
Sakamoto, Ken A. ISr Environmental Specialist 1 420.74 IREIMB FOR TRAINING ISan Diego, CA 3/26-3/28/12
Schiefelbein, Cheryl Administrative Assistant 200.00 VIP GIFT CARDS
Schuler, Kevin A. Maintenance Worker 302.00 CWEA SEMINAR Primm, NV 9/26/11-9/30/11
Schuler, Kevin A. Maintenance Worker 135.00 REIMB FOR CERTIFICATION
Seiler, Merrill F. Pr Environmental Specialist 338.62 REIMB FOR MEETING Chicago IL 4/18-4/20/12
Shaaban, Alexander Sr. Laboratory Analyst 1,294.60 TUITION REIMBURSEMENT
Shaaban, Alexander ISr. Laboratory Analyst 1 847.90 ITUITION REIMBURSEMENT
Shao, Y J. ISenior Engineer 1 73.00 JCWEA LAB ANALYST GRADE I
Shao, Y J. ISenior Engineer 1 125.00 IREIMB FOR CERTIFICATION
Shelp, Curt V. Lead Plant Operator 175.07 TRANSTN STAFF TO SUP TRNG Anaheim, CA 12/16/12
Smith, Duane T. Senior Plant Operator 170.00 CERT REIMBURSEMENT
Speakman, Steven R. Engineer 125.00 CERT REIMBURSEMENT
Spears, James Operations Supervisor 1,305.00 TUITION REIMBURSEMENT
Spears, James loperations Supervisor 1 2,700.00 ITUITION REIMBURSEMENT
Spears, James loperations Supervisor 1 1,350.00 ITUITION REIMBURSEMENT
Page 12 of 15
Orange County Sanitation District
Government Code 53065.5, Public Disclosure Reports - Reimbursements by OCSD
July 1, 2011 Through June 30, 2012
Employee Name Title Amount Invoice Comments Site/Location Duration
Spears, James Operations Supervisor 1,200.00 TUITION REIMBURSEMENT
Stacklin, Christopher A. Engineer 200.25 WEFTEC ANNL CONF 2011 Los Angeles, CA 10/14-10/19/11
Stacklin, Christopher A. jEngineer 1 1,094.07 JWEF MIDYR MTG 2012 INew Orleans, LA 1/24-1/27/12
Stacklin, Christopher A. jEngineer 1 125.00 IPE CHEM ENG CH
Stacklin, Christopher A. Engineer 239.28 REIMB FOR MEETING Oakland, CA 3/23/12
Stahl, Keith C. Plant Operator 130.00 GRADE II WASTEWATER CERT
Stahl, Keith C. Plant Operator 113.04 TUITION REIMBURSEMENT
Stahl, Keith C. Plant Operator 110.55 TUITION REIMBURSEMENT
Steele, Krista L. Safety Et Health Representative 1,019.76 OSHA 510 San Diego, CA 7/10/11-7/14/11
Steele, Krista L. ISafety Et Health Representative 104.00 OSHA 3110 FALL ARREST IFutterton, CA 9/19/11-9/22/11
Stokes, Don F. Instrumentation Tech II 1 132.00 IREIMB FOR CWEA MEMBSHP
Stokes, Don F. Instrumentation Tech II 100.00 CERT REIMBURSEMENT 2012
Stokes, Don F. Instrumentation Tech II 1,200.00 TUITION REIMBURSEMENT
Stratmoen, Erik D. Lead Mechanic 981.03 REIMB FOR TRAINING Sacramento, CA 4/16-4/20/12
Sullivan, Patrick A. Sr. Plant Operator 2,144.00 TUITION REIMBURSEMENT
Swindler, John W. Information Technology Manager 163.91 REIMB FOR IT BOOKS
Swindler, John W. Information Technology Manager 1 123.00 IREIMB FOR TRAINING Las Vegas, NV 2/17-2/23/12
Tafolla, Brian J. lRetiabitity Maint Technician 1 457.32 IFUNDAMENTALS COURSE ISan Diego, CA 3/19/12-3/22/12
Taylor, Mandrick S. Engineer 125.00 PE LICENSE RENEW 2013
Terriquez, Laura A. Sr Environmental Specialist 61.00 SCAMIT MTG Santa Barbara, CA 3/20/12
Terriquez, Laura A. Sr Environmental Specialist 262.21 FOOD PURCH OCEAN MONITOR
Terriquez, Laura A. Sr Environmental Specialist 371.38 REIMB FOR FOOD Et DRINKS
Tetsch, Gina A. Occupational Health Nurse 101.22 HEARING CONSERV TRAINING Los Angeles, CA 3/14/12 - 3/16/12
Tetsch, Gina A. joccupational Health Nurse 1 140.00 IREG NURSE LICENSE 2014
Thiede, Robert J. I Pr Project Controls Analyst 1 154.00 jPMI RENEWAL 2012
Thomas, Christina M. ISr Environmental Specialist 1 750.34 IWEFCONF Louisville, KY 4/15-4/18/12
Thomas, Christina M. Sr Environmental Specialist 181.34 FOOD PURCH OCEAN MONITOR
Thompson, Robert C. Engineering Manager 125.00 CERT REIMBURSEMENT
Thompson, Robert C. Engineering Manager 396.70 2011 INTL INFRASTRUCTURE
Thompson, Robert C. Engineering Manager 2,792.51 TUITION REIMBURSEMENT
Thompson, Robert C. jEngineering Manager 2,763.83 ITUITION REIMBURSEMENT
Thompson, Robert C. jEngineering Manager 1,292.00 ITUITION REIMBURSEMENT
Page 13 of 15
Orange County Sanitation District
Government Code 53065.5, Public Disclosure Reports - Reimbursements by OCSD
July 1, 2011 Through June 30, 2012
Employee Name Title Amount Invoice Comments Site/Location Duration
Thompson, Robert C. Engineering Manager 1,194.17 TUITION REIMBURSEMENT
Tintle, James G. Maintenance Supervisor 172.14 2 TABLES SAMS CLUB
Tintle, James G. IMaintenance Supervisor 1 512.94 1 FLEET BEST MEETING I Denver, CO 6/18-6/21/12
Tintle, James G. IMaintenance Supervisor 1 175.00 IREIMB FOR B WILLIS ISanta Ana, CA 9/9/11
Tintle, James G. Maintenance Supervisor 116.78 REIMB FOR TRAINING Virginia BH, VA 10/16-10/19/11
Tjen, Kwen T. Senior Plant Operator 250.00 GRADE V CERT EXAM
Tjen, Kwen T. Senior Plant Operator 170.00 GRADE III CERTIFICATE2014
Torres, Edward M. Director of Operations Et Maint 125.00 CERT REIMBURSTMENT
Torres, Edward M. Director of Operations Et Maint 662.08 REIMB FOR TRAINING Palm Desert, CA 1/17-1/19/12
Tran, Jane H. jEngineer 1 142.24 IREIMB FOR MEETING jPrimm, NV 9/28-9/29/11
Tsai, Yu-Li ISenior Scientist 1 743.09 JPITTCON 2012 lOrtando, FL 3/12/12 - 3/16/12
Tuiasosopo-Kemper, Gary J. Lead Plant Operator 600.00 TUITION REIMBURSEMENT
Tuiasosopo-Kemper, Gary J. Lead Plant Operator 600.00 TUITION REIMBURSEMENT
Van Exel, Rachel J. Sr Environmental Specialist 204.16 FOOD FOR BMT
Van Exel, Rachel J. Sr Environmental Specialist 190.07 BIOSOLID INT AUDIT 060512
Van Exel, Rachel J. Sr Environmental Specialist 341.32 REIMB FOR TRAINING San Diego, CA 7/13-7/14/11
Velasco, MarcoPolo S. lAssociate Engineer 1 140.00 INACE INTL CIP LEVEL 1
Velasco, MarcoPolo S. lAssociate Engineer III 1 665.88 ITUITION REIMBURSEMENT
Vellucci, Hai-Thao H. Safety Et Health Representative 644.04 ASSE ASP EXAM PREP 2011
Von Winckelmann, Michael Laboratory Supervisor 825.84 CWEA CONF 2012 Sacramento, CA 4/18-20/12
Voss, Betty J. Buyer 1,526.18 TUITION REIMBURSEMENT
Wade, Ronald L. Chief Plant Operator 129.29 STAFF APPRECIATION
Wade, Ronald L. Chief Plant Operator 290.72 WEFTEC 2011 Los Angeles 10/15/11-10/19/11
Waldron, Kathy L. jPrincipal Laboratory Analyst 1 144.00 JCWEA MEMBER FEE 120611
Ward, Paul I Plant Operator 1 1,200.00 ITUITION REIMBURSEMENT
Watson, Simon L. Imaintenance Manager 1 402.09 ISTAFF APPR LUNCH
Watson, Simon L. Maintenance Manager 512.58 CWEA BOARD MTG San Diego, CA 1/26/12
Watson, Simon L. Maintenance Manager 589.62 CWEA STAY FOR R REYNOLDS Sacramento, CA 1/26/12
Watson, Simon L. Maintenance Manager 1,245.70 CWEA CONF 2012 Sacramento, CA 4/16-21/12
Watson, Simon L. Maintenance Manager 379.98 CWEA BOARDMEETING Oakland, CA 6/28-30/12
Watson, Simon L. Imaintenance Manager 1 570.45 1 CWEA MTG lRedding, CA 9/20/11-9/24/11
White, Allen J. ISenior Plant Operator 1 170.00 IGRADE III CERTIFICATE
Page 14 of 15
Orange County Sanitation District
Government Code 53065.5, Public Disclosure Reports - Reimbursements by OCSD
July 1, 2011 Through June 30, 2012
Employee Name Title Amount Invoice Comments Site/Location Duration
White, Allen J. Sr. Plant Operator 115.04 TUITION REIMBURSEMENT
White, Allen J. Sr. Plant Operator 225.10 TUITION REIMBURSEMENT
Wilcox, Robyn A. jEngineer 1 405.00 IREIMB FOR PMP EXAM
Willis, Bryan Automotive/Heavy Equip Tech 1 89.25 ICERT REIMBURSEMENT
Willis, Bryan Automotive/Heavy Equip Tech 732.98 TUITION REIMBURSEMENT
Willis, Bryan Automotive/Heavy Equip Tech 724.80 TUITION REIMBURSEMENT
Willis, Bryan Automotive/Heavy Equip Tech 722.76 TUITION REIMBURSEMENT
Winsor, Charles F. Senior Engineer 125.00 REIMB FOR CERT
Wong, Ken H. Operations Supervisor 190.00 WSTEWATER TRMT CERT 5
Woodward, Jeff W. loperations Supervisor 1 190.00 JWSTEWATER TRMT CERT GRD 4
Yates, Christine W. ISenior Buyer 1 200.00 ICERT REIMBURSEMENT 2012
Yates, Christine W. Senior Buyer 356.12 REIMB FOR MEETING Indian Wells, CA 1/12-1/13/12
Yin, Shuang Engineer 180.00 BCEE REGISTRATION
Yin, Shuang Engineer 125.00 CERT REIMBURSEMENT
Yin, Shuang Engineer 150.00 WASTEWATER CERT EXAM
Zedek, Michael I. Engineer 125.00 PE LICENSE RENEWAL 2013
Zedek, Michael I. jEngineer 1 190.41 IREIMB FOR TRAINING ISan Diego, CA 7/12-7/13/11
Zeller, Paula A. ISenior Plant Operator 1 208.22 JWEFTEC 2011 ILos Angeles, CA 10/17/11-10/19/11
Page 15 of 15
Return to Agenda
ADMINISTRATION COMMITTEE Meeting Date To Bd. of Dir.
09/12/12 09/26/12
AGENDA REPORT Item Number Item Number
3 15
Orange County Sanitation District
FROM: James D. Ruth, General Manager
Originator: Lorenzo Tyner, Director of Finance and Administrative Services
GENERAL MANAGER'S RECOMMENDATION
Authorize the General Manager to issue Revenue Refunding Certificate Anticipation
Notes, Series 2012C, as one-year fixed-rate obligations, in an amount not to exceed
$145.0 million to replace the $143.205 million Revenue Refunding Certificate
Anticipation Notes, Series 2011 B maturing on November 9, 2012.
SUMMARY
In March 2006, the Sanitation District issued $200 million of variable rate Certificates of
Participation (COP), Series 2006 (2006 COPs). Alternatively, the Sanitation District
could have issued debt at an estimated cost of 4.54% on a fixed rate basis in 2006.
From inception through August 2008, the average variable rate on the 2006 COPs was
2.95% or 0.22% less than the SIFMA index (weekly market index of tax-exempt variable
rate obligations). As the global financial crisis took hold in the late summer of 2008,
there was a significant increase in the variable rate borrowing cost of the Sanitation
District, including all municipal borrowers, as the 2006 COPs averaged 4.29% (or 1 .56%
above the SIFMA index) for the period between September 2008 and December 2008.
The amount of the increase in variable rate cost above the SIFMA index can be
attributed to the weakened financial strength of the bank, DEPFA Bank plc, that was
providing liquidity support on the 2006 COPs.
In December 2008, the Sanitation District proactively refunded the 2006 COPs with the
Refunding COP Series 2008C Certificate Anticipation Notes (2008C CANs) to reduce its
exposure to the then higher and more volatile variable rate costs. The yield on the
2008C CANs was 0.98% for a one-year period. The issuance of the 2008C CANs
allowed the Sanitation District to redeem the 2006 COPs at an all-in cost of less than
1.25% and avoid paying a bank rate of 4.75% which would have been effective starting
in January 2009. Since the 2008C CANs issuance, the Sanitation District completed
three additional one-year refinancings as summarized below:
Series Principal Amount Yield All-In Cost
2009B $ 165,865,000 0.370% 0.559%
2010B 154,665,000 0.360 0.525
2011 B 143,205,000 0.225 0.399
The interest rate on the Revenue Refunding Certificate Anticipation Notes Series 2011 B
(2011 B CANs) was fixed for only one year and the entire $143.205 million plus interest
becomes due and payable on November 9, 2012. The Sanitation District is responsible
for the total repayment of $146.061 million (includes interest) or the District could
choose to refinance the 2011 B CANs. Staff does not recommend the use of over $100
Page 1
million of cash to repay the 2011 B CANs; therefore, there are a number of refinancing
options available to the District.
PRIOR COMMITTEE/BOARD ACTIONS
July 2012 — The Board adopted Resolution No. OCSD 12-10, authorizing the execution
and delivery by the Sanitation District of an Installment Purchase Agreement, a Trust
Agreement and a Continuing Disclosure Agreement in connection with the execution
and delivery of Orange County Sanitation District Wastewater Refunding Revenue
Obligations, Series 2012B, authorizing the execution and delivery of such Revenue
Obligations evidencing principal in an aggregate amount of not to exceed $90,000,000,
approving a Notice of Intention to Sell, authorizing the distribution of an Official Notice
Inviting Bids and an Official Statement in connection with the offering and sale of such
Revenue Obligations and authorizing the execution of necessary documents and
related actions.
February 2012 — The Board adopted Resolution No. OCSD 12-04, authorizing the
execution and delivery by the Sanitation District of an Installment Purchase Agreement,
a Trust Agreement, an Escrow Agreement and a Continuing Disclosure Agreement in
connection with the execution and delivery of Orange County Sanitation District
Wastewater Refunding Revenue Obligations, Series 2012A, authorizing the execution
and delivery of such Revenue Obligations evidencing principal in an aggregate amount
of not to exceed $110,000,000, approving a Notice of Intention to Sell, authorizing the
distribution of an Official Notice Inviting Bids and an Official Statement in connection
with the offering and sale of such Revenue Obligations and authorizing the execution of
necessary documents and related actions.
ADDITIONAL INFORMATION
Options Available to the Sanitation District
1. Refund the Maturing 2011 B CANs with Fixed Rate Debt
The issuance of long-term fixed rate refunding debt will eliminate market access risks
(ability to issue debt to refinance maturing debt) and interest rate risk (additional costs if
rates reset higher or are higher upon a future refinancing). After the issuance of fixed
rate debt, the Sanitation District will no longer be exposed to changing market
conditions.
The issuance of long-term fixed rate debt in the current market would result in an
average borrowing yield of approximately 3.40%. Fixed rate debt would also remove
the interest rate hedge originally desired by the Sanitation District (in 2006) which was
intended to insulate the District from changes in short-term interest rates as the variable
rates on the 2006 COPs was expected to move in tandem with the District's fluctuating
investment portfolio earnings.
The following is a current market cost summary (subject to changing market conditions)
of Option 1. (Fixed Rate Debt) over the next year:
Page 2
3.400% Assumed Average Fixed Rate
0.019 Costs of Issuance ($300,000 amortized over life of COPs)
0.035 Underwriter Costs ($556,000 amortized over life of COPs)
3.454% Fixed Rate Cost
2. Refund the Maturing 2011 B CANs with Variable Rate Debt
Current variable rates for highly-rated California municipal borrowers (such as the
District) are extremely low and attractive at approximately 0.10% for traditional variable
rate debt backed by a commercial bank. However, the availability of bank support
continues to be relatively expensive at approximately four times the cost of current
variable rates. In addition, the terms and conditions currently demanded by banks are
more onerous than during the period prior to the global financial crisis. Recently, other
variable rate products have been developed that do not require bank support, but these
products are generally used by issuers to diversify among a portfolio containing many
different variable rate products, unlike the Sanitation District's single issuance of short-
term interest rate exposure (2011 B CANs).
The following is a current market cost comparison (subject to changing market
conditions) of traditional variable rate debt versus Option 1. (Fixed Rate Debt) over the
next year.
Variable% Average Variable Rate
0.400 Bank Liquidity Fee
0.075 Remarketing Fee
0.022 Costs of Issuance ($350,000 amortized over life of COPs)
0.008 Underwriter Costs ($125,000 amortized over life of COPs)
0.505% + Variable% (current total of approximately 0.60%) or
If compared to Option 1., break-even average variable rate of 2.949%
3. Refund the Maturing 2011 B CANs with a New CANs issue
Since the issuance of the 2011 B CANs, short-term interest rates have continue to
stay low as the current market yield for CANs is slightly lower than last year's levels
and presently about 0.20%. The issuance of refunding CANs will continue to allow
the Sanitation District to accrue savings at a low fixed rate over the next year while
further insulating the District from higher interest rates. The CANs structure will
avoid the payment of high fees to liquidity banks and eliminate the risk of interest
rates increasing from historic low levels over the next year. Although current
variable rates are low (see Option 2. above), there is little room for rates to trend
much lower.
Page 3
The following is a current market cost summary (subject to changing market
conditions) of Option 3. (CANs) over the next year.
0.200% Assumed One-Year Rate
0.187 Costs of Issuance ($250,000 amortized over one year)
0.019 Underwriter Costs ($25,000 amortized over one year)
0.406% or
3.048% less than Option 1. (equal to $4.1 million of savings)
A comparison of the CANs refinancing structure to Option 2. above (Variable Rate
Debt) shows that future unknown variable rates must be less than zero for variable
rate debt to generate a better economic result.
The major risk with a CANs structure occurs if the Sanitation District does not have
market access to remarket the CANs at maturity (in 2013). However, the Sanitation
District (1) has successfully issued one-year CANs in each of the last four years and
(2) is a AAA/AAA-rated entity, and (3) holds a substantial amount of reserves that
could (if the Board chooses) be used to redeem CANs if market access is not
available. Staff intends to build in safeguards to avoid the use of Sanitation District
reserves unless absolutely necessary: for example, beginning the process of
refinancing well in advance of the maturity date of the CANs.
To further reduce interest rate risk (additional costs if rates reset higher or are higher
upon a future refinancing) the Sanitation District could continue the Accelerated Rate
Management (ARM) program with the one-year CAN refinancing debt issuance.
Since 2006, the ARM program has used accrued savings (i.e., 0.525% cost on
2010B CANs) compared to a fixed rate assumption (i.e., 2006 fixed rate of 4.54%) to
reducing the outstanding amount of debt on a yearly basis. As less debt is
outstanding, the Sanitation District significantly reduces its interest rate risk (if higher
interest rates occur, the negative effect is mitigated as the higher interest cost is
calculated on a smaller principal amount). The implementation of the ARM program
since the issuance of the 2006 COPs has decreased the interest rate risk to the
Sanitation District as the break-even rate (the average future interest rate for the
remaining debt from the 2006 COPs issuance) is now over 8.0%. If the Sanitation
District refinances the 2011 B CANs with one-year CANs and current market
conditions do not change, the break-even rate will increase to over 8.4%. In
addition, the original variable rate structure of the 2006 COPs and the four past
CANs refinancings have saved the District over $24.7 million compared to the
alternative of the District issuing fixed rate debt in 2006.
Similarly, the Sanitation District could extend beyond the one-year for a CANs
issuance to lock in rates for a longer period of time. The following table presents the
current market results for 2-5 year CANs periods:
Rate Two Years Three Years Four Years Five Years
Rate 0.450% 0.550% 0.650% 0.850%
Costs of Issuance 0.103 0.075 0.056 0.045
Underwriter Costs 0.056 0.056 0.056 0.054
Total (over next year) : 0.609% 0.681% 0.762% 0.949%
Page 4
With the knowledge that the Federal Reserve Bank has announced it will keep short-
term rates low through 2014, staff is recommending Option 3., the refunding of the
2011 B CANs with a new one-year CAN that will again enable the Sanitation District
to lock-in a low rate for an additional year without (a) encumbering cash reserves;
(b) exposing the District to relatively high bank liquidity costs associated with
variable rate debt; and, (c) allowing for flexibility to continue to accrue savings while
insulating the District from higher interest rates (ARM program). If the Sanitation
District pursues Option 3., the refunding CANs can be sold on a competitive basis in
order to obtain the lowest financing cost possible.
Staff and consultants will be available to make a brief presentation and provide an
overview of the financing schedule at the Administration Committee meeting.
Following is a chart listing the remaining steps to be completed for the issuance of
the Revenue Refunding Certificate Anticipation Notes, Series 2012C debt issuance:
September * Board approval of legal and disclosure documents
* Financing Corporation approval of legal and disclosure documents
* Receive Ratings from Bond Rating Agencies
October * Receive competitive bids
* Closing
CEQA
N/A
BUDGET / DELEGATION OF AUTHORITY COMPLIANCE
N/A
Page 5
Return to Agenda
Orange County Sanitation District
Financing Corporation
MINUTES
July 25, 2012
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Administration Building
10844 Ellis Avenue
Fountain Valley, California 92708-7018
Page 1 of 3
ORANGE COUNTY SANITATION DISTRICT FINANCING CORPORATION
CALL TO ORDER:
Chair Edgar called the Board of Directors, Orange County Sanitation District Financing
Corporation meeting to order at 6:58 p.m.
ROLL CALL:
The Clerk of the Board announced that the members of the Orange County Sanitation
District Board of Directors are each being compensated $212.50 for the Board Meeting;
there is no additional compensation for the Financing Corporation Meeting.
X Troy Edgar, Chair Gerri Graham-Mejia
X John Anderson, Vice Chair Jim Winder
X Tom Beamish Rose Espinoza
X Joe Carchio Devin Dwyer
A Larry Crandall Steve Nagel
X Bill Dalton Kris Beard
X Jon Dumitru Denis Bilodeau
X Gail Eastman Harry Sidhu
X James M. Ferryman Bob Ooten
X Jeffrey Lalloway Steven Choi
X Michael Levitt Gordon Shanks
X Prakash Narain Doug Bailey
A Scott Nelson X Constance Underhill
X Joy Neugebauer Al Krippner
X Janet Nguyen Shawn Nelson
X John Nielsen Jerry Amante
X Sharon Quirk-Silva Pat McKinley
X Brad Reese Rick Barnett
X Steven Rosansky Nancy Gardner
X Don Schweitzer Ron Garcia
X David Shawver Carol Warren
X Fred Smith Steve Berry
X Sal Tinajero David Benavides
X Mark Waldman Steven Hwangbo
A John Withers Douglas Reinhart
Page 2of3
APPROVAL OF MINUTES:
MOVED, SECONDED, AND DULY CARRIED: If no corrections or amendments are
made, the minutes for the meeting held on February 22, 2012, will be deemed approved
and be so ordered by the Chair.
ACTION ITEM:
MOVED, SECONDED, AND DULY CARRIED: Adopt Resolution No. FC-18, authorizing
the execution and delivery by the Sanitation District of an Installment Purchase
Agreement, a Trust Agreement and a Continuing Disclosure Agreement in connection
with the execution and delivery of Orange County Sanitation District Wastewater
Refunding Revenue Obligations, Series 2012B, authorizing the execution and delivery
of such Revenue Obligations evidencing principal in an aggregate amount of not to
exceed $90,000,000, approving a Notice of Intention to Sell, authorizing the distribution
of an Official Notice Inviting Bids and an Official Statement in connection with the
offering and sale of such Revenue Obligations and authorizing the execution of
necessary documents and related actions. (See Agenda Report for Item No. 10)
ADJOURNMENT:
The Chair declared the meeting of the Board of Directors, Orange County Sanitation
District Financing Corporation adjourned at 7:00 p.m.
Maria E. Ayala, Secretary
Orange County Sanitation District Financing Corporation
Page 3of3