HomeMy WebLinkAbout03-10-2021 Administration Committee Meeting Complete Agenda Packet
ORANGE COUNTY SANITATION DISTRICT
SPECIAL NOTICE REGARDING CORONAVIRUS (COVID-19)
AND ATTENDANCE AT PUBLIC MEETINGS
On March 4, 2020, Governor Newsom proclaimed a State of Emergency in California as
a result of the threat of COVID-19. On March 12, 2020 and March 18, 2020, Governor
Newsom issued Executive Order N-25-20 and Executive Order N-29-20, which
temporarily suspend portions of the Brown Act which addresses the conduct of public
meetings.
The General Manager and the Chairman of the Board of Directors have determined that
due to the size of the Orange County Sanitation District’s Board of Directors (25), and the
health and safety of the members, the Board of Directors will be participating in meetings
of the Board telephonically and via Internet accessibility.
PUBLIC PARTICIPATION
Your participation is always welcome. The Administration Committee meeting will be
available to the public online at:
https://ocsd.legistar.com/Calendar.aspx
You may submit your comments and questions in writing for the Administration
Committee’s consideration in advance of the meeting by using the eComment feature
available via the webpage above or sending them to OCSanClerk@ocsd.com with the
subject line “PUBLIC COMMENT ITEM # (insert the item number relevant to your
comment)” or “PUBLIC COMMENT NON-AGENDA ITEM”. Submit your written
comments by 5:00 p.m. on Tuesday, March 9, 2021.
You may also submit comments and questions for the Administration Committee’s
consideration during the meeting by using the eComment feature that will be available
via the webpage above for the duration of the meeting.
All public comments will be provided to the Administration Committee and may be read
into the record or compiled as part of the record.
Thank you.
OC ~SAN
ORANGE COUNTY SANITATION DISTRICT
March 3, 2021
NOTICE OF MEETING
ADMINISTRATION COMMITTEE
ORANGE COUNTY SANITATION DISTRICT
Wednesday, March 10, 2021 – 5:00 P.M.
ACCESSIBILITY FOR THE GENERAL PUBLIC
Due to the spread of COVID-19, the Orange County Sanitation District will
be holding all upcoming Board and Committee meetings by
teleconferencing and Internet accessibility. This meeting will be available
to the public online at:
https://ocsd.legistar.com/Calendar.aspx
A regular meeting of the Administration Committee of the Orange County
Sanitation District will be held in the manner indicated herein on
Wednesday, March 10, 2021 at 5:00 p.m.
0 ~SAN 10844 Ellis Avenue
Fountain Valley, CA 92708
714.962.2411
ORANGE COUNTY SANITATION DISTRICT www.ocsan.gov
Our Mission: To protect public health and the environment by
providing effective wastewater collection, treatment, and recycling.
Serving:
Anaheim
Brea
Buena Park
Cypress
Fountain Valley
Fullerton
Garden Grove
Huntington Beach
Irvine
La Habra
La Palma
Los Alamitos
Newport Beach
Orange
Placentia
Santa Ana
Seal Beach
Stanton
Tustin
Villa Park
County of Orange
Costa Mesa
Sanitary District
Midway City
Sanitary District
Irvine Ranch
Water District
Yorba Linda
Water District
ADMINISTRATION COMMITTEE
MEETING DATE
BOARD MEETING DATE
03/10/21 03/24/21
04/14/21 04/28/21
05/12/21 05/26/21
06/09/21 06/23/21
07/14/21 07/28/21
AUGUST DARK 08/25/21
09/08/21 09/22/21
10/13/21 10/27/21
11/10/21 11/17/21 *
12/08/21 12/15/21 *
JANUARY DARK 01/26/22
02/09/22 02/23/22
* Meeting will be held on the third Wednesday of the month
ROLL CALL
ADMINISTRATION COMMITTEE
Finance, Information Technology, Environmental Services
and Human Resources
Meeting Date: March 10, 2021 Time: 5:00 p.m.
Adjourn:
COMMITTEE MEMBERS (13)
Chad Wanke, Chair
Glenn Parker, Vice-Chair
Brad Avery
Art Brown
Kim Carr
Mark Chirco
Rose Espinoza
Marshall Goodman
Patrick Harper
Anthony Kuo
Andrew Nguyen
David Shawver (Board Chair)
John Withers (Board Vice-Chair)
OTHERS
Brad Hogin, General Counsel
STAFF
Jim Herberg, General Manager
Rob Thompson, Assistant General Manager
Lorenzo Tyner, Assistant General Manager
Celia Chandler, Director of Human Resources
Kathy Millea, Director of Engineering
Lan Wiborg, Director of Environmental Services
Kelly Lore, Clerk of the Board
ORANGE COUNTY SANITATION DISTRICT Effective 2/9/2021 BOARD OF DIRECTORS
Complete Roster
AGENCY/CITIES
ACTIVE DIRECTOR
ALTERNATE
DIRECTOR
Anaheim
Stephen Faessel
Jose Diaz
Brea Glenn Parker Steven Vargas
Buena Park Art Brown Connor Traut Cypress Stacy Berry Anne Hertz
Fountain Valley Patrick Harper Glenn Grandis
Fullerton Jesus J. Silva Nick Dunlap
Garden Grove Steve Jones John O’Neill Huntington Beach Kim Carr Dan Kalmick
Irvine Anthony Kuo
Farrah N. Khan
La Habra Rose Espinoza Jose Medrano
La Palma Marshall Goodman Nitesh Patel
Los Alamitos Mark A. Chirco Ron Bates Newport Beach Brad Avery Joy Brenner
Orange Kim Nichols Chip Monaco
Placentia Chad Wanke Ward Smith
Santa Ana Johnathan Ryan Hernandez Nelida Mendoza Seal Beach Sandra Massa-Lavitt
Schelly Sustarsic
Stanton David Shawver Carol Warren Tustin Ryan Gallagher Austin Lumbard
Villa Park Chad Zimmerman Robert Collacott
Sanitary/Water Districts
Costa Mesa Sanitary District
Bob Ooten
Art Perry Midway City Sanitary District Andrew Nguyen
Sergio Contreras Irvine Ranch Water District John Withers
Douglas Reinhart
Yorba Linda Water District Brooke Jones Phil Hawkins
County Areas
Board of Supervisors Doug Chaffee Donald P. Wagner
ADMINISTRATION COMMITTEE
Regular Meeting Agenda
Wednesday, March 10, 2021 - 5:00 PM
Board Room
Administration Building
10844 Ellis Avenue
Fountain Valley, CA 92708
(714) 593-7433
AGENDA POSTING: In accordance with the requirements of California Government Code Section 54954.2, this
agenda has been posted outside the main gate of the Sanitation District’s Administration Building located
at 10844 Ellis Avenue, Fountain Valley, California, and on the Sanitation District’s website at www.ocsd.com
not less than 72 hours prior to the meeting date and time above. All public records relating to each agenda
item, including any public records distributed less than 72 hours prior to the meeting to all, or a majority
of the Board of Directors, are available for public inspection in the office of the Clerk of the Board.
AGENDA DESCRIPTION: The agenda provides a brief general description of each item of business to
be considered or discussed. The recommended action does not indicate what action will be taken. The Board
of Directors may take any action which is deemed appropriate.
MEETING AUDIO: An audio recording of this meeting is available within 24 hours after adjournment of
the meeting. Please contact the Clerk of the Board's office at (714) 593-7433 to request the audio file.
NOTICE TO DIRECTORS: To place items on the agenda for a Committee or Board Meeting, the item must
be submitted in writing to the Clerk of the Board: Kelly A. Lore, MMC, (714) 593-7433 / klore@ocsd.com at least
14 days before the meeting.
FOR ANY QUESTIONS ON THE AGENDA, BOARD MEMBERS MAY CONTACT STAFF AT:
General Manager: Jim Herberg, jherberg@ocsd.com / (714) 593-7300
Asst. General Manager: Lorenzo Tyner, ltyner@ocsd.com / (714) 593-7550
Asst. General Manager: Rob Thompson, rthompson@ocsd.com / (714) 593-7310
Director of Human Resources: Celia Chandler, cchandler@ocsd.com / (714) 593-7202
Director of Engineering: Kathy Millea, kmillea@ocsd.com / (714) 593-7365
Director of Environmental Services: Lan Wiborg, lwiborg@ocsd.com / (714) 593-7450
OC ~SAN
ORANGE COUNTY SANITATION DISTRICT
ADMINISTRATION COMMITTEE Regular Meeting Agenda Wednesday, March 10, 2021
CALL TO ORDER
PLEDGE OF ALLEGIANCE
ROLL CALL AND DECLARATION OF QUORUM:
Clerk of the Board
PUBLIC COMMENTS:
Your participation is always welcome. The Administration Committee meeting will be available to the public online
at: https://ocsd.legistar.com/Calendar.aspx.
You may submit your comments and questions in writing for the Administration Committee’s consideration in
advance of the meeting by using the eComment feature available via the webpage above or sending them to
OCSanClerk@ocsd.com with the subject line “PUBLIC COMMENT ITEM # (insert the item number relevant to
your comment)” or “PUBLIC COMMENT NON-AGENDA ITEM”. Submit your written comments by 5:00 p.m. on
March 9, 2021 at 5:00 p.m.
You may also submit comments and questions for the AdministrationCommittee’s consideration during the
meeting by using the eComment feature that will be available via the webpage above for the duration of the
meeting. All public comments will be provided to the Administration Committee and may be read into the record
or compiled as part of the record.
REPORTS:
The Committee Chairperson and the General Manager may present verbal reports on miscellaneous matters of
general interest to the Directors. These reports are for information only and require no action by the Directors.
CONSENT CALENDAR:
Consent Calendar Items are considered to be routine and will be enacted, by the Committee, after one motion,
without discussion. Any items withdrawn from the Consent Calendar for separate discussion will be considered in
the regular order of business.
1.2021-1512APPROVAL OF MINUTES
RECOMMENDATION:
Approve Minutes of the Regular Meeting of the Administration Committee held
February 10, 2021.
Originator:Kelly Lore
Agenda Report
02-10-2021 Administration Committee Minutes
Attachments:
Page 1 of 4
ADMINISTRATION COMMITTEE Regular Meeting Agenda Wednesday, March 10, 2021
2.2021-1401RECORDS MANAGEMENT IMPLEMENTATION - TRUSTED SYSTEM
RECOMMENDATION:
A. Approve a Professional Consultant Services Agreement with ECS Imaging, Inc.
to provide implementation services for a Records Management System,
Specification No. CS-2020-1199BD, for an amount not to exceed $150,949;
B. Approve a contingency of $ 22,642 (15%); and
C. Approve four (4) optional one-year maintenance renewals of $14,164 per year.
Originator:Lorenzo Tyner
Agenda Report
CS-2020-1199BD PCSA - ECS
Attachments:
NON-CONSENT:
3.2021-1468SETTLEMENT OF CLAIMS, COLLECTION OF DELINQUENT
ACCOUNTS, AND WORKERS’ COMPENSATION ACTIONS
RECOMMENDATION: Recommend to the Board of Directors to:
Adopt Resolution No. OC SAN 21-XX entitled, “A Resolution of the Board of Directors
of Orange County Sanitation District Adopting Procedures for Settlement of Claims
Made Against the Orange County Sanitation District; Settlement of Claims Made By the
Orange County Sanitation District; Collection of Delinquent Accounts Owing to the
Orange County Sanitation District; Settlement of Civil or Administrative Enforcement
Actions; and Settlement of Workers’ Compensation Actions; and repealing Resolution
No. OCSD 11-04”.
Originator:Lorenzo Tyner
Agenda Report
Draft Resolution No. OC SAN 21-XX - Redlined
Draft Resolution No. OC SAN 21-XX - Clean
Attachments:
4.2021-1469WASTEWATER REFUNDING REVENUE OBLIGATIONS, SERIES
2021A
RECOMMENDATION: Recommend to the Board of Directors to:
Authorize the General Manager to issue new fixed rate Certificates of Participation, to
be referred to as Wastewater Refunding Revenue Obligations, in (1) an amount
sufficient to refund $102,200,000 of Revenue Refunding Certificate Anticipation Notes,
Series 2018A maturing on August 15, 2021 and (2) an additional amount sufficient to
refund, subject to market conditions, up to $61,575,000 of Wastewater Refunding
Revenue Obligations, Series 2011A.
Page 2 of 4
ADMINISTRATION COMMITTEE Regular Meeting Agenda Wednesday, March 10, 2021
Originator:Lorenzo Tyner
Agenda Report
AAA General Obligation Municipal Market Data Index-PRAG
Attachments:
INFORMATION ITEMS:
5.2021-1511OVERVIEW OF PROPERTY - LIABILITY INSURANCE
RECOMMENDATION:
Information Item.
Originator:Lorenzo Tyner
Agenda Report
Item 5 Presentation
Attachments:
6.2021-1501FY 2021-22 ORANGE COUNTY SANITATION DISTRICT BUDGET
UPDATE REVENUE OVERVIEW
RECOMMENDATION:
Information Item.
Originator:Lorenzo Tyner
Agenda Report
FY 2021-22 Budget Update Revenue Detail
Reserve Summary - FY 2020-21
Item 6 Presentation
Attachments:
7.2021-1519OPERATIONS & MAINTENANCE: WASTEWATER 101
RECOMMENDATION:
Information Item.
Originator:Rob Thompson
Agenda Report
Wastewater Treatment Presentation
Attachments:
DEPARTMENT HEAD REPORTS:
CLOSED SESSION:
None.
Page 3 of 4
ADMINISTRATION COMMITTEE Regular Meeting Agenda Wednesday, March 10, 2021
OTHER BUSINESS AND COMMUNICATIONS OR SUPPLEMENTAL AGENDA ITEMS, IF
ANY:
BOARD OF DIRECTORS INITIATED ITEMS FOR A FUTURE MEETING:
At this time Directors may request staff to place an item on a future agenda.
ADJOURNMENT:
Adjourn the Committee meeting until the Regular Meeting of the Administration Committee on
April 14, 2021 at 5:00 p.m.
Page 4 of 4
ADMINISTRATION COMMITTEE
Agenda Report
Administration Building
10844 Ellis Avenue
Fountain Valley, CA 92708
(714) 593-7433
File #:2021-1512 Agenda Date:3/10/2021 Agenda Item No:1.
FROM:James D. Herberg, General Manager
Originator: Kelly A. Lore, Clerk of the Board
SUBJECT:
APPROVAL OF MINUTES
GENERAL MANAGER'S RECOMMENDATION
RECOMMENDATION:
Approve Minutes of the Regular Meeting of the Administration Committee held February 10, 2021.
BACKGROUND
In accordance with the Board of Directors Rules of Procedure, an accurate record of each meeting
will be provided to the Directors for subsequent approval at the following meeting.
RELEVANT STANDARDS
·Resolution No. OC SAN 21-04
ATTACHMENT
The following attachment(s) may be viewed on-line at the OC San website (www.ocsan.gov) with the complete agenda
package:
·Minutes of the Administration Committee meeting held February 10, 2021
Orange County Sanitation District Printed on 3/2/2021Page 1 of 1
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OC6SAN
ORANGE COUNTY SANITATION DISTRICT
Orange County Sanitation District
Minutes for the
ADMINISTRATION COMMITTEE
Wednesday, February 10, 2021
5:00 PM
Board Room
Administration Building
10844 Ellis Avenue
Fountain Valley, CA 92708
(714) 593-7433
CALL TO ORDER
A regular meeting of the Administration Committee was called to order by Committee Chair
Chad Wanke on Wednesday, February 10, 2021 at 5:01 p.m. in the Administration Building of
the Orange County Sanitation District. Clerk of the Board Kelly Lore led the Flag Salute.
The Clerk of the Board stated that the meeting was being held telephonically and via
audio/video teleconferencing in accordance with the Governor's Executive Order No. N-29-20,
due to the Coronavirus Pandemic (COVID-19).
ROLL CALL AND DECLARATION OF QUORUM:
Roll call was taken and a quorum was declared present, as follows:
PRESENT:Chad Wanke, Glenn Parker, Brad Avery, Art Brown, Kim Carr, Mark
Chirco, Marshall Goodman, Patrick Harper, Andrew Nguyen, Anthony
Kuo, David Shawver and John Withers
ABSENT:Rose Espinoza
STAFF PRESENT: Kelly Lore, Clerk of the Board, and Mortimer Caparas were present in
the Board Room. Jim Herberg, General Manager; Rob Thompson, Assistant General
Manager; Lorenzo Tyner, Assistant General Manager; Celia Chandler, Director of Human
Resources; Lan Wiborg, Director of Environmental Services; Jennifer Cabral; Tina Knapp;
Wally Ritchie; and Thomas Vu were in attendance telephonically.
OTHERS PRESENT: Brad Hogin, General Counsel was present in the Board Room. Bill
Dennehy, Chandler Asset Management was in attendance telephonically.
PUBLIC COMMENTS:
None.
REPORTS:
Chair Wanke and General Manager Herberg did not provide a report.
Committee Vice-Chair Glenn Parker provided an update of today's Audit Ad Hoc Committee
Meeting noting the processing of last year's audit topics and prioritization of this year's topics.
The Committee will meet again in the near future with the auditor's report and their
development/timeline for the three chosen topics for this year's audit: Construction Contract
compliance; Sole source contracts/agreements; and General Manager's approval items.
Page 1 of 5
OC ~SAN
ORANGE COUNTY SANITATION DISTRICT
ADMINISTRATION
COMMITTEE
Minutes February 10, 2021
Assistant General Manager Lorenzo Tyner provided a brief update on the approximately
$4,000,000 in tracked COVID-19 related expenses and the requested reimbursements.
CONSENT CALENDAR:
1.APPROVAL OF MINUTES 2020-1391
Originator: Kelly Lore
MOVED, SECONDED, AND DULY CARRIED TO:
Approve Minutes of the Regular Meeting of the Administration Committee held
December 9, 2020.
AYES:Chad Wanke, Glenn Parker, Kim Carr, Mark Chirco, Marshall
Goodman, Patrick Harper, Anthony Kuo, David Shawver and John
Withers
NOES:None
ABSENT:Brad Avery, Art Brown, Rose Espinoza and Andrew Nguyen
ABSTENTIONS:None
2.GENERAL MANAGER APPROVED PURCHASES AND ADDITIONS
TO THE PRE-APPROVED OEM SOLE SOURCE LIST
2021-1456
Originator: Lorenzo Tyner
MOVED, SECONDED, AND DULY CARRIED TO: Recommend to the Board of
Directors to:
A. Receive and file Orange County Sanitation District purchases made under the
General Manager’s authority for the period of October 1, 2020 to December 31,
2020; and
B. Approve the following additions to the pre-approved OEM Sole Source List for
the period of October 1, 2020 to December 31, 2020:
·FONTAINE-AQUANOX - Replacement Parts, Equipment and Service
·GOOCH THERMAL SYSTEMS, INC - Spiral Heat Exchangers
·HIDROSTAL, LLC - Pumps and Replacement Parts
·RODNEY HUNT, INC. - Diversion Gates and Actuators
·SMARTCOVER SYSTEMS - Sewer Level Monitors
AYES:Chad Wanke, Glenn Parker, Kim Carr, Mark Chirco, Marshall
Goodman, Patrick Harper, Anthony Kuo, David Shawver and John
Withers
NOES:None
ABSENT:Brad Avery, Art Brown, Rose Espinoza and Andrew Nguyen
Page 2 of 5
ADMINISTRATION
COMMITTEE
Minutes February 10, 2021
ABSTENTIONS:None
3.MID-YEAR CONSOLIDATED FINANCIAL REPORT FOR THE PERIOD
ENDED DECEMBER 31, 2020
2020-1326
Originator: Lorenzo Tyner
MOVED, SECONDED, AND DULY CARRIED TO: Recommend to the Board of
Directors to:
Receive and file the Orange County Sanitation District Mid-Year Financial Report for
the period ended December 31, 2020.
AYES:Chad Wanke, Glenn Parker, Kim Carr, Mark Chirco, Marshall
Goodman, Patrick Harper, Anthony Kuo, David Shawver and John
Withers
NOES:None
ABSENT:Brad Avery, Art Brown, Rose Espinoza and Andrew Nguyen
ABSTENTIONS:None
4.BUSINESS ANALYSIS SERVICES FOR RESOURCE PROTECTION
DIVISION
2020-1366
Originator: Lorenzo Tyner
MOVED, SECONDED, AND DULY CARRIED TO: Recommend to the Board of
Directors to:
A. Award a Professional Consultant Services Agreement to EEC Environmental,
Inc. for Pretreatment Program Consulting Services, for the procurement of
Business Analysis services to document Resource Protection division business
processes, Specification No. CS-2020-1167BD, for a total amount not to exceed
$385,625; and
B. Approve a contingency in the amount of $38,563 (10%).
AYES:Chad Wanke, Glenn Parker, Kim Carr, Mark Chirco, Marshall
Goodman, Patrick Harper, Anthony Kuo, David Shawver and John
Withers
NOES:None
ABSENT:Brad Avery, Art Brown, Rose Espinoza and Andrew Nguyen
ABSTENTIONS:None
NON-CONSENT:
5.PURCHASE OF AN IMAGING FLOWCYTOBOT (IFCB)2021-1437
Originator: Lan Wiborg
Director of Environmental Services Lan Wiborg provided a brief overview of the item.
Page 3 of 5
ADMINISTRATION
COMMITTEE
Minutes February 10, 2021
MOVED, SECONDED, AND DULY CARRIED TO:
Approve a sole source purchase order to McLane Research Laboratories, Inc. for an
Imaging FlowCytobot for an amount not to exceed $148,939 including estimated tax
and shipping.
AYES:Chad Wanke, Glenn Parker, Kim Carr, Mark Chirco, Marshall
Goodman, Patrick Harper, Anthony Kuo, David Shawver and John
Withers
NOES:None
ABSENT:Brad Avery, Art Brown, Rose Espinoza and Andrew Nguyen
ABSTENTIONS:None
6.CONSIDERATION OF BUDGET ASSUMPTIONS AND BUDGET
CALENDAR FOR PREPARATION OF THE FISCAL YEAR 2021-22
BUDGET UPDATE
2021-1447
Originator: Lorenzo Tyner
Mr. Tyner introduced Controller Wally Ritchie who provided a PowerPoint presentation
briefly explaining the budget assumptions and budget calendar for the year.
MOVED, SECONDED, AND DULY CARRIED TO:
Approve the FY 2021-22 budget assumptions and direct staff to incorporate these
parameters in preparing the FY 2021-22 budget update.
AYES:Chad Wanke, Glenn Parker, Kim Carr, Mark Chirco, Marshall
Goodman, Patrick Harper, Anthony Kuo, David Shawver and John
Withers
NOES:None
ABSENT:Brad Avery, Art Brown, Rose Espinoza and Andrew Nguyen
ABSTENTIONS:None
Directors Art Brown and Andrew Nguyen arrived at the meeting at 5:26 p.m.
Director Brad Avery arrived at the meeting at 5:28 p.m.
INFORMATION ITEMS:
7.INVESTMENT PERFORMANCE RESULTS 2020-1327
Originator: Lorenzo Tyner
Mr. Ritchie provided a PowerPoint presentation regarding OC San Reserves and
Investments including the Seven Reserve Criteria, Investment Objectives, and
Portfolios. Bill Dennehy, Chandler Asset Management, provided a PowerPoint
Page 4 of 5
ADMINISTRATION
COMMITTEE
Minutes February 10, 2021
presentation which provided: Overview of the firm; economic update, and account
profile.
ITEM RECEIVED AS AN:
Information Item.
DEPARTMENT HEAD REPORTS:
None.
CLOSED SESSION:
None.
OTHER BUSINESS AND COMMUNICATIONS OR SUPPLEMENTAL AGENDA ITEMS, IF
ANY:
None.
BOARD OF DIRECTORS INITIATED ITEMS FOR A FUTURE MEETING:
None.
ADJOURNMENT:
Chair Wanke declared the meeting adjourned at 5:44 p.m. to the Regular meeting to be held
on Wednesday, March 10, 2021 at 5:00 p.m.
Submitted by:
__________________
Kelly A. Lore, MMC
Clerk of the Board
Page 5 of 5
ADMINISTRATION COMMITTEE
Agenda Report
Administration Building
10844 Ellis Avenue
Fountain Valley, CA 92708
(714) 593-7433
File #:2021-1401 Agenda Date:3/10/2021 Agenda Item No:2.
FROM:James D. Herberg, General Manager
Originator: Lorenzo Tyner, Assistant General Manager
SUBJECT:
RECORDS MANAGEMENT IMPLEMENTATION - TRUSTED SYSTEM
GENERAL MANAGER'S RECOMMENDATION
RECOMMENDATION:
A. Approve a Professional Consultant Services Agreement with ECS Imaging, Inc. to provide
implementation services for a Records Management System, Specification No. CS-2020-
1199BD, for an amount not to exceed $150,949;
B. Approve a contingency of $ 22,642 (15%); and
C. Approve four (4) optional one-year maintenance renewals of $14,164 per year.
BACKGROUND
As part of the General Manager’s workplan, the Orange County Sanitation District (Sanitation District)
will be implementing Phase I of a Records Management System which will include a Trusted System
functionality to preserve vital records.
Phase I will include the migration of Board Services documents to the system. Content will be
browsable and searchable through a public facing portal. Phase I will also include the creation of a
Human Resources repository with security measures in place to protect Personally Identifiable
Information. The system will integrate and interface with Granicus govMeeting Legistar, NeoGov
Insight, and NeoGov Onboard used by Board Services and Human Resources.
The consultant will be responsible for implementing the software, hardware, and database
configuration, documentation, and training for the Trusted System functionality as defined by the
California Secretary of State (SOS).
RELEVANT STANDARDS
·Comply with California Code of Regulations Title 2. Division 7. Chapter 15. Trustworthy Electronic Document or
Record Preservation
·Comply with transparency and communications requirements, including the Brown Act
·California Government Code §4526: Select the “best qualified firm” and “negotiate fair and equitable fees”
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OC6SAN
ORANGE COUNTY SANITATION DISTRICT
File #:2021-1401 Agenda Date:3/10/2021 Agenda Item No:2.
PROBLEM
A comprehensive Records Management and Trusted System Needs Assessment,including a review of policies,business
processes,technology systems,and implementation guidance for the digitization and a paperless initiative,was
completed in January 2020.During the evaluation,staffing requirements to support and sustain the Records
Management program were found to be ineffective.A recommendation to move Records Management to Board Services
was made and has been implemented.
During the system assessment,records were found in more than seven varied electronic storage systems including
SharePoint,shared drives,OneDrive,PC hard drives,computer desktops,redundant storage systems as well as hard
copy paper files.This practice inhibits the ability to effectively manage all the Sanitation District’s records.A
recommendation was made to secure one Records Management System for records storage and proceed with
implementation of document migration.
PROPOSED SOLUTION
Approve a Professional Consultant Services Agreement with ECS Imaging,Inc.to provide implementation services for
Records Management System, Specification No. CS-2020-1199BD.
TIMING CONCERNS
Records will continue to be produced as time passes, thus increasing the difficulty to effectively manage the records.
RAMIFICATIONS OF NOT TAKING ACTION
Sanitation District records will remain in a variety of electronic systems that are not considered trusted by SOS
specifications and which require that the hard copy of all records must be retained.
PRIOR COMMITTEE/BOARD ACTIONS
N/A
ADDITIONAL INFORMATION
Consultant Selection:
The Sanitation District requested and advertised for proposals for the Records Management Implementation,
Specification No.CS-2020-1199BD,on October 27,2020.The following evaluation criterion were described in the
Request for Proposals (RFP) and used to determine the most qualified Consultant.
CRITERION WEIGHT
Qualification of the Firm 40%
Staffing and Project Organization 20%
Work Plan 20%
Cost 20%
Four proposals were received on December 2,2020 and evaluated in accordance with the evaluation
process set forth in Sanitation District Board of Directors’Purchasing Ordinance No.OCSD-52
(Purchasing Ordinance)by a pre-selected Evaluation Team consisting of the following Sanitation
District staff:Principal Information Technology Analyst,Senior Information Technology Analyst,Clerk
of the Board,Assistant Clerk of the Board,and an Engineering Manager.The Evaluation Team also
included one non-voting representative from the Purchasing Division.
The Evaluation Team scored the proposal on the established criterion as summarized in the table
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File #:2021-1401 Agenda Date:3/10/2021 Agenda Item No:2.
The Evaluation Team scored the proposal on the established criterion as summarized in the table
below:
Firm Qualification of
Firm (Max
40%)
Staffing & Project
Organization
(Max 20%)
Work Plan
(Max 20%)
Cost (Max
20%)
Total Score
(Max 100%)
1 ECS Imaging, Inc.35%16%15%20%86%
2 Complete
Paperless Solutions
24%14%12%3%53%
3 James E. Hughes 18%11%9%3%41%
4 Nexlogica 14%9%12%3%34%
Following scoring,the Evaluation Team concluded that interviews were not necessary to determine
the most qualified consultant.ECS Imaging,Inc.was selected as the most qualified Consultant
based on their superior project approach,similar project experience,and detailed understanding of
the risks involved with the project.
Review of Fee Proposal and Negotiations:
Proposals were accompanied by sealed fee proposals.Only the fee proposal of the Evaluation
Committee’s highest-ranked firm was opened in accordance with the Purchasing Ordinance.
Staff conducted negotiations with ECS Imaging,Inc.to clarify the requirements of the Scope of Work
and was able to obtain a Best and Final Offer (BAFO)resulting in a cost savings of over $13,000 to
the Sanitation District.
Original Fee
Proposal
Negotiated Fee
Total Fee $164,532.50 $150,948.50
Based on the above,staff has determined that the final negotiated fee is fair and reasonable for the
level of effort required for this project and recommends award of the Professional Consultant
Services Agreement to ECS Imaging, Inc.
FINANCIAL CONSIDERATIONS
This request complies with authority levels of the Sanitation District's Purchasing Ordinance.This
item has been budgeted.(Adopted Budget,Fiscal Year 2020-2021 and 2021-2022,Section 8,Page
49, Information Technology Capital Program (M-MC-IT)).
ATTACHMENT
The following attachment(s)may be viewed on-line at the OC San website (www.ocsan.gov)with the complete agenda
package:
·Professional Consultant Services Agreement
Orange County Sanitation District Printed on 3/3/2021Page 3 of 3
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PROFESSIONAL CONSULTANT SERVICES AGREEMENT
Records Management Implementation
Specification No. CS-2020-1199BD
THIS AGREEMENT is made and entered into as of the date fully executed below, by and between
Orange County Sanitation District, with a principal place of business at 10844 Ellis Avenue,
Fountain Valley, CA 92708 (hereinafter referred to as "OCSD") and ECS Imaging, Inc. with a
principal place of business at 5905 Brockton Avenue, Suite C, Riverside, CA 92506 (hereinafter
referred to as "Consultant") collectively referred to as the “Parties”.
W I T N E S S E T H
WHEREAS, based on Consultant’s expertise and experience, OCSD desires to temporarily engage
Consultant to provide records management implementation services, "Services” as described in
Exhibit “A”; and
WHEREAS, Consultant submitted its Proposal, dated December 14, 2020; and
WHEREAS, on March 10, 2021, the Administration Committee of OCSD, by minute order,
authorized execution of this Agreement between OCSD and Consultant; and
WHEREAS, OCSD has chosen Consultant to conduct Services in accordance with Ordinance No.
OCSD-52; and
NOW, THEREFORE, in consideration of the mutual promises and mutual benefits exchanged
between the Parties, the Parties mutually agree as follows:
1. Introduction
1.1 This Agreement and all exhibits hereto (called the "Agreement") is made by OCSD and the
Consultant. The terms and conditions herein exclusively govern the purchase of Services as
described in Exhibit “A”.
1.2 Exhibits to this Agreement are incorporated by reference and made a part of this Agreement
as though fully set forth at length herein.
Exhibit “A” Scope of Work
Exhibit “B” Proposal submitted December 14, 2020 and
Best and Final Offer dated February 25, 2021
Exhibit “C” Determined Insurance Requirement Form
Exhibit “D” Contractor Safety Standards
Exhibit “E” Human Resources Policies
1.3 In the event of any conflict or inconsistency between the provisions of this Agreement and any
of the provisions of the exhibits hereto, the provisions of this Agreement shall in all respects
govern and control.
1.4 This Agreement may not be modified, changed, or supplemented, nor may any obligations
hereunder be waived or extensions of time for performance granted, except by written
instrument signed by both Parties.
1.5 The various headings in this Agreement are inserted for convenience only and shall not affect
the meaning or interpretation of this Agreement or any section or provision hereof.
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1.6 References to “OC SAN” and/or “OC San” shall mean Orange County Sanitation District.
1.7 The term “days”, when used in the Agreement, shall mean calendar days, unless otherwise
noted as workdays.
1.8 The term “workday”. Workdays are defined as all days that are not Saturday, Sunday, or
OCSD observed holidays. Meetings with OCSD staff shall be scheduled from Monday through
Thursday between the hours of 8 a.m. and 4 p.m. (exception is Operations staff who maintain
plant operations 24/7 and work a rotated 12-hour shift) and shall conform to OCSD work
schedules. OCSD review periods shall not include OCSD observed holidays.
1.9 OCSD holidays (non-working days) are as follows: New Year’s Day, Lincoln’s Birthday,
Presidents’ Day, Memorial Day, Independence Day, Labor Day, Veterans Day, Thanksgiving
Day, Day after Thanksgiving, Christmas Eve, and Christmas Day.
1.10 Work Hours: All work shall be scheduled Monday through Thursday, between the hours of
7:30 a.m. and 4:30 p.m. OCSD will not pay for travel time.
1.11 Consultant shall provide OCSD with all required premiums and/or overtime work at no charge
beyond the amounts stated under “Compensation” below.
1.12 Except as expressly provided otherwise, OCSD accepts no liability for any expenses, losses,
or action incurred or undertaken by Consultant as a result of work performed in anticipation
of purchases of said services by OCSD.
2. Scope of Work Subject to the terms of this Agreement, Consultant shall perform the Services
identified in Exhibit “A”. Consultant warrants that all of its Services shall be performed in a
competent, professional, and satisfactory manner.
3. Modifications to Scope of Work Requests for modifications to the Scope of Work hereunder
can be made by OCSD at any time. All modifications must be made in writing and signed by
both Parties. A review of the time required for the modification will be made by OCSD and
Consultant and the Agreement period adjusted accordingly.
4. Compensation
4.1 Compensation to be paid by OCSD to Consultant for the Services provided under this
Agreement shall be a total amount not to exceed One Hundred Fifty Thousand, Nine Hundred
Forty-nine Dollars ($150,949.00).
4.2 If OCSD elects to renew the Agreement, for Annual Maintenance, the total amount not to
exceed for each one-year renewal period shall be Fourteen Thousand, One Hundred Sixty-
four Dollars ($14,164.00).
5. California Department of Industrial Relations (DIR)Registration and Record of Wages
5.1 To the extent Consultant’s employees and/or subconsultants who will perform work for which
Prevailing Wage Determinations have been issued by the DIR and as more specifically
defined under Labor Code Section 1720 et seq, Consultant and subconsultants shall comply
with the registration requirements of Labor Code Section 1725.5. Pursuant to Labor Code
Section 1771.4, the work is subject to compliance monitoring and enforcement by the DIR.
5.2 The Consultant and subconsultants shall maintain accurate payroll records and shall comply
with all the provisions of Labor Code Section 1776, and shall submit payroll records to the
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Labor Commissioner pursuant to Labor Code 1771.4(a)(3). Penalties for non-compliance with
the requirements of Section 1776 may be deducted from progress payments per Section 1776.
5.3 Pursuant to Labor Code Section 1776, the Consultant and subconsultants shall furnish a copy
of all certified payroll records to OCSD and/or general public upon request, provided the public
request is made through OCSD, the Division of Apprenticeship Standards, or the Division of
Labor Standards Enforcement of the Department of Industrial Relations.
5.4 The Consultant and subconsultants shall comply with the job site notices posting requirements
established by the Labor Commissioner per Title 8, California Code of Regulation Section
16461(e).
6. Payment and Invoicing
6.1 OCSD shall pay, net thirty (30) days, upon receipt and approval, by OCSD’s Project Manager
or designee, of itemized invoices submitted for Milestones completed in accordance with
Exhibit “A” at no charge beyond the amounts stated in Exhibit “B”. OCSD, at its sole discretion,
shall be the determining party as to whether the Milestones have been satisfactorily
completed.
6.2 Invoices shall be emailed by Consultant to OCSD Accounts Payable at APStaff@OCSD.com
and “INVOICE” with the Purchase Order Number and CS-2020-1199BD shall be referenced
in the subject line.
7. Audit Rights Consultant agrees that, during the term of this Agreement and for a period of
three (3) years after its termination, OCSD shall have access to and the right to examine any
directly pertinent books, documents, and records of Consultant relating to the invoices
submitted by Consultant pursuant to this Agreement.
8. Commencement and Term The Services provided under this Agreement shall be completed
within one (1) year from the effective date of the Notice to Proceed.
9. Renewals
9.1 OCSD may exercise the option to renew this Agreement, for Annual Maintenance, for up to
four (4) one-year periods, under the terms and conditions contained herein. OCSD shall make
no obligation to renew nor give reason if it elects not to renew.
9.2 This Agreement may be renewed by OCSD Purchase Order.
10. Extensions The term of this Agreement may be extended only by written instrument signed
by both Parties.
11. Performance Time is of the essence in the performance of the provisions hereof.
12. Termination
12.1 OCSD reserves the right to terminate this Agreement for its convenience, with or without
cause, in whole or in part, at any time, by written notice from OCSD. Upon receipt of a
termination notice, Consultant shall immediately discontinue all work under this Agreement
(unless the notice directs otherwise). OCSD shall thereafter, within thirty (30) days, pay
Consultant for work performed (cost and fee) to the date of termination. Consultant expressly
waives any claim to receive anticipated profits to be earned during the uncompleted portion
of this Agreement. Such notice of termination shall terminate this Agreement and release
OCSD from any further fee, cost or claim hereunder by Consultant other than for work
performed to the date of termination.
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12.2 OCSD reserves the right to terminate this Agreement immediately upon OCSD’s
determination that Consultant is not complying with the Scope of Work requirements, if the
level of service is inadequate, or any other default of this Agreement.
12.3 OCSD may also immediately terminate for default of this Agreement in whole or in part by
written notice to Consultant:
if Consultant becomes insolvent or files a petition under the Bankruptcy Act; or
if Consultant sells its business; or
if Consultant breaches any of the terms of this Agreement; or
if total amount of compensation exceeds the amount authorized under this Agreement.
12.4 All OCSD property in the possession or control of Consultant shall be returned by Consultant
to OCSD on demand, or at the termination of this Agreement, whichever occurs first.
13. Indemnification and Hold Harmless Provision Consultant shall assume all responsibility
for damages to property and/or injuries to persons, including accidental death, which may
arise out of or be caused by Consultant's services under this Agreement, or by its
subconsultant(s) or by anyone directly or indirectly employed by Consultant, and whether such
damage or injury shall accrue or be discovered before or after the termination of the
Agreement. Except as to the sole active negligence of or willful misconduct of OCSD,
Consultant shall indemnify, protect, defend and hold harmless OCSD, its elected and
appointed officials, officers, agents and employees, from and against any and all claims,
liabilities, damages or expenses of any nature, including attorneys' fees: (a) for injury to or
death of any person or damage to property or interference with the use of property, arising
out of or in connection with Consultant's performance under the Agreement, and/or (b) on
account of use of any copyrighted or uncopyrighted material, composition, or process, or any
patented or unpatented invention, article or appliance, furnished or used under the
Agreement, and/or (c) on account of any goods and services provided under this Agreement.
This indemnification provision shall apply to any acts or omissions, willful misconduct, or
negligent misconduct, whether active or passive, on the part of Consultant or anyone
employed by or working under Consultant. To the maximum extent permitted by law,
Consultant's duty to defend shall apply whether or not such claims, allegations, lawsuits, or
proceedings have merit or are meritless, or which involve claims or allegations that any of the
parties to be defended were actively, passively, or concurrently negligent, or which otherwise
assert that the parties to be defended are responsible, in whole or in part, for any loss,
damage, or injury. Consultant agrees to provide this defense immediately upon written notice
from OCSD, and with well qualified, adequately insured, and experienced legal counsel
acceptable to OCSD. This section shall survive the expiration or early termination of the
Agreement.
14. Insurance Consultant and all subconsultants shall purchase and maintain, throughout the
life of this Agreement and any periods of warranty or extensions, insurance in amounts equal
to the requirements set forth in the signed Determined Insurance Requirement Form, Exhibit
“C“. Consultant shall not commence work under this Agreement until all required insurance is
obtained in a form acceptable to OCSD, nor shall Consultant allow any subconsultant to
commence service pursuant to a subcontract until all insurance required of the subconsultant
has been obtained. Failure to maintain required insurance coverage shall result in termination
of this Agreement.
15. Key Personnel Personnel, as provided in Exhibit “B”, are considered “key” to the work under
this Agreement and will be available for the term of the Agreement. No person designated as
key under this Agreement shall be removed or replaced without prior written consent of OCSD.
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If OCSD asks Consultant to remove a person designated as key under this Agreement,
Consultant agrees to do so immediately regardless of the reason, or the lack of reason, for
OCSD's request. Consultant shall assign only competent personnel to perform services
pursuant to this Agreement.
16. Confidentiality and Non-Disclosure
16.1 Consultant acknowledges that in performing the Services hereunder, OCSD may have to
disclose to Consultant orally and in writing certain confidential information that OCSD
considers proprietary and has developed at great expense and effort.
16.2 Consultant agrees to maintain in confidence and not disclose to any person, firm, or
corporation, without OCSD's prior written consent, any trade secret or confidential information,
knowledge or data relating to the products, process, or operation of OCSD.
16.3 Consultant further agrees to maintain in confidence and not to disclose to any person, firm, or
corporation any data, information, technology, or material developed or obtained by
Consultant during the term of this Agreement.
16.4 Consultant agrees as follows:
To use the confidential information only for the purposes described herein; to not reproduce
the confidential information; to hold in confidence and protect the confidential information from
dissemination to and use by anyone not a party to this Agreement; and to not use the
confidential information to benefit itself or others.
To restrict access to the confidential information to its Consultant or personnel of Consultant
who (1) have a need to have such access and (2) have been advised of and have agreed in
writing to treat such information in accordance with the terms of this Agreement.
To return all confidential information in Consultant's possession upon termination of this
Agreement or upon OCSD's request, whichever occurs first.
To hold in confidence information and materials, if any, developed pursuant to the Services
hereunder.
16.5 The provisions of this section shall survive termination or expiration of this Agreement and
shall continue for so long as the material remains confidential.
17. Ownership of Documents All drawings, specifications, reports, records, documents,
memoranda, correspondence, computations, and other materials prepared by Consultant, its
employees, subconsultants, and agents in the performance of this Agreement shall be the
property of OCSD and shall be promptly delivered to OCSD upon request of OCSD’s Project
Manager or designee, or upon the termination of this Agreement, and Consultant shall have
no claim for further employment or additional compensation as a result of the exercise by
OCSD of its full rights of ownership of the documents and materials hereunder. Any use of
such completed documents for other projects and/or use of incomplete documents without
specific written authorization by the Consultant will be at OCSD's sole risk and without liability
to Consultant. Consultant shall ensure that all its subconsultants shall provide for assignment
to OCSD of any documents or materials prepared by them.
18. Ownership of Intellectual Property
18.1 Consultant agrees that all designs, plans, reports, specifications, drawings, schematics,
prototypes, models, inventions, and all other information and items made during the course
of this Agreement and arising from the Services (hereinafter referred to as "New
Developments") shall be and are assigned to OCSD as its sole and exclusive property.
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18.2 Consultant agrees to promptly disclose to OCSD all such New Developments. Upon OCSD's
request, Consultant agrees to assist OCSD, at OCSD's expense, to obtain patents or
copyrights for such New Developments, including the disclosure of all pertinent information
and data with respect thereto, the execution of all applications, specifications, assignments,
and all other instruments and papers which OCSD shall deem necessary to apply for and to
assign or convey to OCSD, its successors and assigns, the sole and exclusive right, title and
interest in such New Developments. Consultant agrees to obtain or has obtained written
assurances from its employees and contract personnel of their agreement to the terms hereof
with regard to New Developments and confidential information.
18.3 Consultant warrants that Consultant has good title to any New Developments, and the right
to assign New Developments to OCSD free of any proprietary rights of any other party or any
other encumbrance whatever.
18.4 The originals of all computations, drawings, designs, graphics, studies, reports, manuals,
photographs, videotapes, data, computer files, and other documents prepared or caused to
be prepared by Consultant or its subconsultants in connection with these Services shall be
delivered to and shall become the exclusive property of OCSD. OCSD may utilize these
documents for OCSD applications on other projects or extensions of this project, at its own
risk.
19. No Solicitation of Employees
19.1 Consultant agrees that it shall not, during the term of this Agreement and for a period of one
(1) year immediately following termination of this Agreement, or any extension hereof, call on,
solicit, or take away any of the employees whom Consultant became aware of as a result of
Consultant's Services to OCSD.
19.2 Consultant acknowledges that OCSD’s employees are critical to its business and OCSD
expends significant resources to hire, employ, and train employees. Should Consultant
employ or otherwise engage OCSD’s employees during the term of this Agreement and for a
period of one (1) year following termination of this Agreement, Consultant will pay OCSD fifty
percent (50%) of the former employee’s most recent annual salary earned at OCSD to
accurately reflect the reasonable value of OCSD’s time and costs. This payment is in addition
to any other rights and remedies OCSD may have at law.
20. Independent Contractor Capacity
20.1 The relationship of Consultant to OCSD is that of an independent contractor and nothing
herein shall be construed as creating an employment or agency relationship.
20.2 Consultant shall act independently and not as an officer or employee of OCSD. OCSD
assumes no liability for Consultant’s action and performance, nor assumes responsibility for
taxes, funds, payments or other commitments, implied or expressed, by or for Consultant.
20.3 Consultant shall not be considered an agent of OCSD for any purpose whatsoever, nor shall
Consultant have the right to, and shall not, commit OCSD to any agreement, contract or
undertaking. Consultant shall not use OCSD’s name in its promotional material or for any
advertising or publicity purposes without expressed written consent.
20.4 Consultant shall not be entitled to any benefits accorded to those individuals listed on OCSD’s
payroll as regular employees including, without limitation, worker's compensation, disability
insurance, vacation, holiday or sick pay. Consultant shall be responsible for providing, at
Consultant’s expense, disability, worker's compensation or other insurance as well as licenses
and permits usual or necessary for conducting the Services hereunder.
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20.5 Consultant shall be obligated to pay any and all applicable Federal, State and local payroll
and other taxes incurred as a result of fees hereunder. Consultant hereby indemnifies OCSD
for any claims, losses, costs, fees, liabilities, damages or penalties suffered by OCSD arising
out of Consultant's breach of this provision.
20.6 Consultant shall not be eligible to join or participate in any benefit plans offered to those
individuals listed on OCSD's payroll as regular employees. Consultant shall remain ineligible
for such benefits or participation in such benefit plans even if a court later decides that OCSD
misclassified Consultant for tax purposes.
21. Licenses, Permits Consultant represents and warrants to OCSD that it has obtained all
licenses, permits, qualification and approvals of whatever nature that are legally required to
engage in this work. Any and all fees required by Federal, State, County, City and/or municipal
laws, codes and/or tariffs that pertain to work performed under the terms of this Agreement
will be paid by Consultant.
22. Consultant's Representations In the performance of duties under this Agreement,
Consultant shall adhere to the highest fiduciary standards, ethical practices and standards of
care and competence for their trade/profession. Consultant agrees to comply with all
applicable Federal, State and local laws and regulations.
23. Familiarity with Work By executing this Agreement, Consultant warrants that: 1) it has
investigated the work to be performed; 2) it has investigated the site of the work and is aware
of all conditions there; and 3) it understands the facilities, difficulties and restrictions of the
work under this Agreement. Should Consultant discover any latent or unknown conditions
materially differing from those inherent in the work or as represented by OCSD, it shall
immediately inform OCSD of this and shall not proceed, except at Consultant’s risk, until
written instructions are received from OCSD.
24. Right to Review Services, Facilities, and Records
24.1 OCSD reserves the right to review any portion of the Services performed by Consultant under
this Agreement, and Consultant agrees to cooperate to the fullest extent possible.
24.2 Consultant shall furnish to OCSD such reports, statistical data, and other information
pertaining to Consultant's Services as shall be reasonably required by OCSD to carry out its
rights and responsibilities under its agreements with its bondholders or noteholders and any
other agreement relating to the development of the project(s) and in connection with the
issuance of its official statements and other prospectuses with respect to the offering, sale,
and issuance of its bonds and other obligations.
24.3 The right of OCSD to review or approve drawings, specifications, procedures, instructions,
reports, test results, calculations, schedules, or other data that are developed by Consultant
shall not relieve Consultant of any obligation set forth herein.
25. Force Majeure Neither party shall be liable for delays caused by accident, flood, acts of God,
fire, labor trouble, war, acts of government or any other cause beyond its control, but said
party shall use reasonable efforts to minimize the extent of the delay. Work affected by a
Force Majeure condition may be rescheduled by mutual consent or may be eliminated from
the Agreement.
26. Severability If any section, subsection, or provision of this Agreement, or any agreement or
instrument contemplated hereby, or the application of such section, subsection, or provision
is held invalid, the remainder of this Agreement or instrument in the application of such
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section, subsection or provision to persons or circumstances other than those to which it is
held invalid, shall not be affected thereby, unless the effect of such invalidity shall be to
substantially frustrate the expectations of the Parties.
27. Waiver The waiver of either party of any breach or violation of, or default under, any provision
of this Agreement, shall not be deemed a continuing waiver by such party of any other
provision or of any subsequent breach or violation of this Agreement or default thereunder.
Any breach by Consultant to which OCSD does not object shall not operate as a waiver of
OCSD’s rights to seek remedies available to it for any subsequent breach.
28. Remedies In addition to other remedies available in law or equity, if the Consultant fails to
make delivery of the goods or Services or repudiates its obligations under this Agreement, or
if OCSD rejects the goods or Services or revokes acceptance of the goods or Services, OCSD
may (1) terminate the Agreement; (2) recover whatever amount of the purchase price OCSD
has paid, and/or (3) “cover” by purchasing, or contracting to purchase, substitute goods or
Services for those due from Consultant. In the event OCSD elects to “cover” as described in
(3), OCSD shall be entitled to recover from Consultant as damages the difference between
the cost of the substitute goods or Services and the Agreement price, together with any
incidental or consequential damages.
29. Governing Law This Agreement shall be governed by and interpreted under the laws of the
State of California and the Parties submit to jurisdiction in Orange County, in the event any
action is brought in connection with this Agreement or the performance thereof.
30. Environmental Compliance Consultant shall, at its own cost and expense, comply with all
Federal, State, and local environmental laws, regulations, and policies which apply to the
Consultant, its sub-consultants, and the Services, including, but not limited to, all applicable
Federal, State, and local air pollution control laws and regulations.
31. Attorney’s Fees If any action at law or inequity or if any proceeding in the form of an
Alternative Dispute Resolution (ADR) is necessary to enforce or interpret the terms of this
Agreement, the prevailing party shall be entitled to reasonable attorney's fees, costs and
necessary disbursements in addition to any other relief to which it may be entitled.
32. Dispute Resolution
32.1 In the event of a dispute as to the construction or interpretation of this Agreement, or any
rights or obligations hereunder, the Parties shall first attempt, in good faith, to resolve the
dispute by mediation. The Parties shall mutually select a mediator to facilitate the resolution
of the dispute. If the Parties are unable to agree on a mediator, the mediation shall be
conducted in accordance with the Commercial Mediation Rules of the American Arbitration
Agreement, through the alternate dispute resolution procedures of Judicial Arbitration through
Mediation Services of Orange County ("JAMS"), or any similar organization or entity
conducting an alternate dispute resolution process.
32.2 In the event the Parties are unable to timely resolve the dispute through mediation, the issues
in dispute shall be submitted to arbitration pursuant to California Code of Civil Procedure, Part
3, Title 9, Sections 1280 et seq. For such purpose, an agreed arbitrator shall be selected, or
in the absence of agreement, each party shall select an arbitrator, and those two (2) arbitrators
shall select a third. Discovery may be conducted in connection with the arbitration proceeding
pursuant to California Code of Civil Procedure Section 1283.05. The arbitrator, or three (3)
arbitrators acting as a board, shall take such evidence and make such investigation as
deemed appropriate and shall render a written decision on the matter in question. The
arbitrator shall decide each and every dispute in accordance with the laws of the State of
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California. The arbitrator's decision and award shall be subject to review for errors of fact or
law in the Superior Court for the County of Orange, with a right of appeal from any judgment
issued therein.
33. Damage to OCSD's Property Any OCSD property damaged by Consultant will be subject
to repair or replacement by Consultant at no cost to OCSD.
34. Contractor Safety Standards OCSD requires Consultant and its subconsultants to follow
and ensure their employees follow all Federal, State and local regulations as well as
Contractor Safety Standards while working at OCSD locations. If during the course of the
Agreement it is discovered that Contractor Safety Standards do not comply with Federal, State
or local regulations, then the Consultant is required to follow the most stringent regulatory
requirement at no additional cost to OCSD. Consultant and all of its employees and
subconsultants, shall adhere to all applicable Contractor Safety Standards attached hereto in
Exhibit “D” and the Human Resources Policies in Exhibit “E”.
35. Freight (F.O.B. Destination) Consultant assumes full responsibility for all transportation,
transportation scheduling, packing, handling, insurance, and other services associated with
delivery of all products deemed necessary under this Agreement.
36. Assignments Consultant shall not delegate any duties nor assign any rights under this
Agreement without the prior written consent of OCSD. Any such attempted delegation or
assignment shall be void.
37. Conflict of Interest and Reporting
37.1 Consultant shall at all times avoid conflicts of interest or appearance of conflicts of interest in
performance of this Agreement.
37.2 Consultant affirms that to the best of its knowledge there exists no actual or potential conflict
between Consultant’s families, business or financial interest or its Services under this
Agreement, and in the event of change in either its private interests or Services under this
Agreement, it will raise with OCSD any question regarding possible conflict of interest which
may arise as a result of such change.
38. Third Party Rights Nothing in this Agreement shall be construed to give any rights or benefits
to anyone other than OCSD and Consultant.
39. Non-Liability of OCSD Officers and Employees No officer or employee of OCSD shall be
personally liable to Consultant, or any successor-in-interest, in the event of any default or
breach by OCSD or for any amount which may become due to Consultant or to its successor,
or for breach of any obligation of the terms of this Agreement.
40. Authority to Execute The persons executing this Agreement on behalf of the Parties warrant
that they are duly authorized to execute this Agreement and that by executing this Agreement,
the Parties are formally bound.
41. Read and Understood By signing this Agreement, Consultant represents that it has read
and understood the terms and conditions of the Agreement.
42. Entire Agreement This Agreement constitutes the entire agreement of the Parties and
supersedes all prior written or oral and all contemporaneous oral agreements,
understandings, and negotiations between the Parties with respect to the subject matter
hereof.
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43. Notices All notices under this Agreement must be in writing. Written notice shall be delivered
by personal service or sent by registered or certified mail, postage prepaid, return receipt
requested, or by any other overnight delivery service which delivers to the noticed destination
and provides proof of delivery to the sender. Rejection or other refusal to accept or the inability
to deliver because of changed address for which no notice was given as provided hereunder
shall be deemed to be receipt of the notice, demand or request sent. All notices shall be
effective when first received at the following addresses:
OCSD: Jackie Lagade, Principal Buyer
Orange County Sanitation District
10844 Ellis Avenue
Fountain Valley, CA 92708-7018
Consultant: Debbi Bodewin, CEO
ECS Imaging, Inc.
5905 Brockton Avenue, Suite C
Riverside, CA 92506
Each party shall provide the other party written notice of any change in address as soon as
practicable.
IN WITNESS WHEREOF, intending to be legally bound, the Parties hereto have caused this
Contract to be signed by the duly authorized representatives.
ORANGE COUNTY SANITATION DISTRICT
Dated: _________________ By: ___________________________________
Chad Wanke
Chair, Administration Committee
Dated: _________________ By: ___________________________________
Kelly A. Lore
Clerk of the Board
Dated: _________________ By: ___________________________________
Ruth Zintzun
Purchasing & Contracts Manager
ECS IMAGING, INC.
Dated: _________________ By: ___________________________________
______________________________________
Print Name and Title of Officer
ADMINISTRATION COMMITTEE
Agenda Report
Administration Building
10844 Ellis Avenue
Fountain Valley, CA 92708
(714) 593-7433
File #:2021-1468 Agenda Date:3/10/2021 Agenda Item No:3.
FROM:James D. Herberg, General Manager
Originator: Lorenzo Tyner, Assistant General Manager
SUBJECT:
SETTLEMENT OF CLAIMS, COLLECTION OF DELINQUENT ACCOUNTS, AND WORKERS’
COMPENSATION ACTIONS
GENERAL MANAGER'S RECOMMENDATION
RECOMMENDATION: Recommend to the Board of Directors to:
Adopt Resolution No. OC SAN 21-XX entitled, “A Resolution of the Board of Directors of Orange
County Sanitation District Adopting Procedures for Settlement of Claims Made Against the Orange
County Sanitation District; Settlement of Claims Made By the Orange County Sanitation District;
Collection of Delinquent Accounts Owing to the Orange County Sanitation District; Settlement of Civil
or Administrative Enforcement Actions; and Settlement of Workers’ Compensation Actions; and
repealing Resolution No. OCSD 11-04”.
BACKGROUND
Resolution No. OCSD 11-04 was adopted on March 23, 2011, updating and repealing Resolution No.
OCSD 98-23 concerning settlement of claims, collection of delinquent accounts, and workers’
compensation actions. Since that time, the Orange County Sanitation District (Sanitation District) has
undergone organizational changes as well as operational changes that make the current Resolution
outdated. The Resolution has been updated to reflect these organizational changes as well as
delegation of authority changes with respect to claims made against and by the Sanitation District,
collection of delinquent accounts, civil or administrative actions, and workers’ compensation actions.
RELEVANT STANDARDS
·Sanitation District Policies and Procedures
PROBLEM
Since Resolution No. OCSD 11-04 was adopted, the Sanitation District has undergone organizational
changes as well as operational changes that make the current resolution outdated.
Orange County Sanitation District Printed on 3/3/2021Page 1 of 2
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OC6SAN
ORANGE COUNTY SANITATION DISTRICT
File #:2021-1468 Agenda Date:3/10/2021 Agenda Item No:3.
PROPOSED SOLUTION
The Resolution has been updated to reflect these organizational changes as well as process
changes and delegation of authority changes with respect to claims made against and by the
Sanitation District,collection of delinquent accounts,civil or administrative actions,and workers’
compensation actions.
TIMING CONCERNS
N/A
RAMIFICATIONS OF NOT TAKING ACTION
The current Resolution is outdated and may cause delays in actions regarding settlement of claims,
collection of delinquent accounts, and workers’ compensation issues.
PRIOR COMMITTEE/BOARD ACTIONS
March 2011 -Adopted Resolution No.OCSD 11-04 Adopting Procedures for Settlement of Claims
Made Against the Orange County Sanitation District (OCSD);Settlement of Claims Made by OCSD;
Collection of Delinquent Accounts Owing to OCSD;Settlement of Civil or Administrative Actions;and
Settlement of Worker’s Compensation Actions; and repealing Resolution No. OCSD 98-23.
ATTACHMENT
The following attachment(s)may be viewed on-line at the OC San website (www.ocsan.gov)with the complete agenda
package:
·Draft Resolution No. OC SAN 21-XX (Redlined)
·Draft Resolution No. OC SAN 21-XX (Clean)
Orange County Sanitation District Printed on 3/3/2021Page 2 of 2
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OC SAN 21-XX-1
RESOLUTION NO. OCSD 11-04 OC SAN 21-XX
A RESOLUTION OF THE BOARD OF DIRECTORS OF ORANGE
COUNTY SANITATION DISTRICT ADOPTING PROCEDURES FOR
SETTLEMENT OF CLAIMS MADE AGAINST THE ORANGE
COUNTY SANITATION DISTRICT SETTLEMENT OF CLAIMS MADE
BY THE ORANGE COUNTY SANITATION DISTRICT; COLLECTION OF
DELINQUENT ACCOUNTS OWING TO THE ORANGE COUNTY
SANITATION DISTRICT: SETTLEMENT OF CIVIL OR
ADMINISTRATIVE ENFORCEMENT ACTIONS; AND SETTLEMENT
OF WORKERS' COMPENSATION ACTIONS, AND REPEALING
RESOLUTION NO. OCSD 11-04
WHEREAS claims for damages alleging personal injuries, bodily injuries,
including death, and damages to real and personal property, are periodically made
against the Orange County Sanitation District (OC San); and,
WHEREAS the Sanitation DistrictOC San presently has liability insurance in
force with a significant self-insured retention, having previously been self-insured;
and,
WHEREAS the Sanitation DistrictOC San has the need for the retention of
claims administration services and legal counsel who shall be vested with certain
limited authority to accomplish a favorable disposition of claims made against the
Sanitation DistrictOC San; and,
WHEREAS claims for workers' compensation damages alleging personal
injuries, including death, are periodically made against the Sanitation DistrictOC San;
and,
WHEREAS the Sanitation DistrictOC San presently has major stop loss
workers' compensation insurance in force; and,
WHEREAS the Sanitation DistrictOC San has retained a claims administration
service firm and special legal counsel who shall be vested with certain limited authority
to accomplish a favorable disposition of workers' compensation claims made against
the Sanitation DistrictOC San as provided herein; and
WHEREAS cost efficiency relating to resolution of workers' compensation
claims can be greatly improved by the adopt ion of certain policies relating to the
resolution of said claims; and
OC SAN 21-XX-2
W HEREAS Government Code Section 935.4 authorizes the Board of Directors
to delegate by resolution the authority to an employee to settle pre-litigation claims
against the Sanitation DistrictOC San up to $50,000; and
W HEREAS Government Code section 935.2 authorizes the Board of Directors
to delegate by resolution the authority to a committee of at least three members to
settle pre-litigation claims; and
W HEREAS Government Code Section 949 authorizes the Board of Directors to
delegate authority to an employee or its attorney to settle lawsuits; and
W HEREAS the Sanitation DistrictOC San has occasion to seek recovery
against persons or entities who have caused loss or damage to the Sanitation
DistrictOC San, who have been assessed fines, charges, or special fees relating to
their use of Sanitation DistrictOC San facilities, or who have been the subject of civil
or administrative enforcement proceedings for violation of the Sanitation DistrictOC
San's Wastewater Discharge Regulations Ordinance; and
W HEREAS in the course of conducting the business affairs of the Sanitation
DistrictOC San, certain accounts receivable or other obligations owing to the
Sanitation DistrictOC San become delinquent, and in fact, uncollectible; and
W HEREAS cost efficiency relating to collection of delinquent accounts can be
greatly improved by the adoption of certain policies relating to the collection of said
accounts; and
W HEREAS the Board of Directors desires to update, amend, and
reestablish procedures for the administration of claims against and by the Sanitation
DistrictOC San.
NOW , THEREFORE, the Board of Directors of Orange County Sanitation
District, DOES HEREBY DETERMINE, RESOLV E AND ORDER:
OC SAN 21-XX-3
ARTICLE I
SETTLEMENT OF LIABILITY CLAIMS
MADE AGAINST THE
ORANGE COUNTY SANITATION DISTRICT
Section 1.1: A liability reserve has been established for the payment of claims
made against the Sanitation DistrictOC San. Said reserve shall continue to be
provided in each annual budget to ensure that sufficient funds are on deposit to
provide for payment of those amounts incurred as a liability loss or expense.
Section 1.2: Each annual budget shall provide, in addition to the reserve
established by Section 1.1, for the necessary funds to provide a sufficient balance to
meet projected expenses for loss and payment of claims during the ensuing fiscal
year.
Section 1.3: A claims administration firm is authorized to be retained, and said
firm is hereby granted authorization to make payments and settlements of claims
made against the Sanitation DistrictOC San in an amount not to exceed $5,000.00
per claimant. Said firm shall be retained in accordance with the terms and conditions
set forth in an agreement approved by the General Counsel.
Section 1.4: A Committee comprised of the General Manager or his designee
and Director of Finance and Administrative Services are authorized to review and
make full settlement of any claims made against the Sanitation DistrictOC San for
contract or liability damages not otherwise covered by insurance by payment of a
sum not to exceed $50,000.00 per claimant. In the event a claim results in litigation,
which is being legally defended by other than the Sanitation DistrictOC San's
General Counsel, this Committee shall review and provide the approval to the
Sanitation DistrictOC San's special legal counsel within the same limits.
Section 1.5: All claims for damages resulting in a judgment or a recommended
settlement by negotiation in an amount exceeding $50,000.00 per claimant, shall be
submitted toto, and approved by the Board of Directors of the Sanitation DistrictOC
San prior to settlement payments being made.
Section 1.6: The General Counsel, with concurrence of the General Manager,
is authorized to retain the services of special legal counsel for purposes of
representing the Sanitation DistrictOC San in the defense of any claim or matter of
litigation , whenever it is determined that specialized expertise or experience is
desirable, a conflict of interest exists or could arise with the Office of General
Counsel, or that the work load of the Office of General Counsel requires the utilization
of special counsel.
OC SAN 21-XX-4
ARTICLE II
COLLECTION OF DELINQUENT OBLIGATIONS OWING TO
THE ORANGE COUNTY SANITATION DISTRICT
Section 2. 1: The Director of Finance and Administrative Services is authorized
to write off as an uncollectible debt any delinquent obligation owing to the Sanitation
DistrictOC San in excess of 90 days and not exceeding the sum of $1025,000.00.
Section 2.2: The Director of Finance and Administrative Services, in his
discretion, is authorized to assign for collection to a person or firm of his choosing,
any delinquent obligation owing to the Sanitation DistrictOC San in excess of 45 days
and not exceeding the sum of $100,000.00. Ninety (90) days after assigning the
obligation for collection, the Director of Finance and Administrative Services is
authorized to write off as an uncollectible debt any portion of the obligation which is
still outstanding.
Section 2.3: The Director of Finance and Admin istrative Services shall forward
any delinquent obligation in excess of $100,000.00 to the General Counsel for the
Sanitation DistrictOC San, who shall submit his recommendation to the Board of
Directors as to the method of collection or disposition of said account.
Section 2.4: The Director of Finance and Admin istrative Services, in his
discretion, is authorized to file the necessary proceedings in the small claims court of
the appropriate judicial Sanitation Ddistrict of the County of Orange, in order to collect
any delinquent obligation owing to the Sanitation DistrictOC San in excess of 45 days
and not exceeding the sum of $5,000.00. Upon obtaining a judgment in favor of the
Sanitation DistrictOC San, the Director of Finance and Admin istrative Services and
General Counsel shall take all legal measures necessary to enforce the terms of the
judgment. Ninety (90) days after receiving a final judgment in favor of the Sanitation
DistrictOC San, the Director of Finance and Administrative Services, with the
concurrence of the General Counsel, is authorized to write off as an uncollectible
debt, any portion of the obligation which is still outstanding.
Section 2.5: Notwithstanding the authority provided in Sections 2.2 and 2.3
above, any obligation owing to the Sanitation DistrictOC San, not exceeding the sum
of $100,000.00, may be compromised by acceptance of a sum less than the full
amount due or may be written off as uncollectible upon that determination being
made, after investigation by a Committee comprised of the General Manager, or his
designee, and the Director of Finance and Administrative Services.
Section 2.6: In addition to the above authorization, the Director of Finance
and Administrative Services is directed to exercise all available lawful methods to
ensure prompt and full recovery of all obligations owing to the Sanitation DistrictOC
OC SAN 21-XX-5
San.
Section 2.7: The Director of Finance and Administrative Services is authorized
to offset against any sums held on deposit by the Sanitation DistrictOC San on behalf
of any person or entity who owes a delinquent obligation to the Sanitation DistrictOC
San.
Section 2.8: The Director of Finance and Administrative Services is authorized
to withhold the approval of any such permits otherwise to be issued by the Sanitation
DistrictOC San to any person or entity who has an outstanding debt obligation owing
to the Sanitation DistrictOC San until such time as said debt obligation is paid in full.
Section 2.9: Delinquent obligations, as used in this Resolution, shall include
any invoice submitted by the Sanitation DistrictOC San for services rendered or for
reimbursement of damages caused to Sanitation DistrictOC San property or
personnel, which has not been paid within:
(a) The time prescribed by OC San Ordinance or Resolution;
(b) Forty-five (45) days from the date of invoice, whichever is later.
ARTICLE Ill
COLLECTION OF FEES AND CHARGES RELATING
TO INDUSTRIAL WASTE DISCHARGES
Section 3.1: In the event any fees or charges , up to the amount of $100 ,000.00,
are owed by an Industrial Waste Permittee and are delinquent or in dispute between
the Permittee and Sanitation DistrictOC San, a Committee comprised of the Director
of Finance and Administrative Services, and Director of Engineering Environmental
Services are authorized to negotiate and enter into, on behalf of the Sanitation
DistrictOC San, a settlement agreement relating to the financial obligation owing to the
Sanitation DistrictOC San. This Section shall not apply to enforcement actions which
are specifically provided for in Article IV below. Said agreement shall be based upon
a showing of good cause and a reasonable dispute between the Sanitation DistrictOC
San and the Permittee, andPermittee and can provide for acceptance of a sum less
than the full amount claimed as due by the Sanitation DistrictOC San. This agreement
may be entered into prior to or during the pendency of any litigation filed by the
Sanitation DistrictOC San to collect the amount owed.
OC SAN 21-XX-6
Section 3.2: Upon written request and establishment of good cause by an
Industrial Waste Permittee, the Committee of the General Manager, or his designee,
the Director of Finance and Admin istrative Services, and Director of
EngineeringEnvironmental Services, may negotiate and enter into a deferred
payment agreement with the Permittee in accordance with the guidelines established
herein. Said agreement may be incorporated as part of, or separate and in addition
to, any enforcement compliance agreements authorized by the provisions of the
Sanitation DistrictOC San's Wastewater Discharge Regulations Ordinance.
Section 3.2.1: The installment payment agreement shall be for a maximum
term not to exceed 24 months. The agreement shall provide for payment of interest
on the principal amount owing at a rate not exceeding the higher of:
(a) Ten (10%) percent per annum; or
(b) Five (5%) percent per annum , plus the rate prevailing on the 25th
day of the month preceding the earlier of:
(i) The date of execution of the contract to make the loan or
forbearance; or
(ii) The date of making the loan or forbearance. (Established by
the Federal Reserve Bank of San Francisco on advances to
member banks under Sections 13 and 13(a) of the Federal
Reserve Act (commonly referred to as the "discount" rate).
The agreement shall provide for payment of all costs of preparing and
administering the payment agreement, including legal and administrative costs.
Section 3.2.2: The agreement shall stipulate the penalties to which the
Permittee shall be subjected in the event of nonpayment of any of the payments
specified in the agreement, including initiation of legal action or permit suspens ion or
revocation, as recommended by the General Counsel and the Director of
EngineeringEnvironmental Services.
Section 3.3: If the delinquent obligation is greater than $100,000.00, any
compromise settlement or any deferred payment agreement shall be submitted to and
approved by the Board of Directors, who shall prescribe the terms and conditions.
OC SAN 21-XX-7
ARTICLE IV
SETTLEMENT OF CIVIL ADMINISTRATIVE
ENFORCEMENT ACTIONS
Section 4.1: In the event the Sanitation DistrictOC San initiates or intends to
initiate any civil or administrative enforcement actions based upon alleged violations
of the Sanitation DistrictOC San's Wastewater Discharge Regulations Ordinance, a
Committee comprised of the General Manager, or his designee, the Director of
Finance and Administrative Services, and Director of Engineering Environmental
Services are authorized to negotiate and enter into, on behalf of the Sanitation
DistrictOC San, a settlement agreement , which may include both payment to the
Sanitation DistrictOC San in an amount up to $100 ,000.00, and enforcement
compliance orders deemed appropriate to ensure compliance with the Wastewater
Discharge Regulations Ordinance. This agreement may be entered into prior to or
during the pendency of any administrative proceeding or litigation enforcement
action.
Section 4.2: The Committee of the General Manager, Director of Finance and
Administrative Services, and Director of Engineering Environmental Services may
negotiate and enter into a settlement agreement which includes a schedu le of
payments over a period of time not to exceed 24 months, by the person or entity
which is the subject of the enforcement action. The agreement shall provide for
payment of interest on the principal amount owing at a rate not exceeding the higher
of:
(a) Ten (10%) percent per annum; or
(b) Five (5%) percent per annum, plus the rate prevailing on the 25th
day of the month preceding the earlier of:
(i) The date of execution of the contract to make the loan or
forbearance; or
(ii) The date of making the loan or forbearance.
(Established by the Federal Reserve Bank of San
Francisco on advances to member banks under Sections
13 and 13(a) of the Federal Reserve Act (commonly
referred to as the "discount" rate).)
Section 4.3: If the proposed settlement involves the payment of an amount
greater than $100 ,000.00, the settlement shall be submitted for approval by the
Board of Directors of the Sanitation DistrictOC San.
OC SAN 21-XX-8
ARTICLE V
SETTLEMENT OF WORKERS' COMPENSATION
CLAIMS MADE AGAI NST THE
ORANGE COUNTY SANITATION DISTRICT
Section 5. 1: A workers’ compensation liability reserve has been established
for the payment of workers’ compensation claims made against OC San. Said reserve
shall continue to be provided in each annual budget to ensure that sufficient funds are
available to provide for payment of the amounts incurred as a workers’ compensation
liability loss or expense.
A minimum liability reserve has been established in the amount
of
$250,000.00 for the payment of claims made against the
Sanitation District. Said minimum amount shall continue to be provided
for in each annual budget to ensure that sufficient funds are on deposit
to provide for payment of those amounts incurred as a
liability loss or expense.
Section 5. 2: Each annual budget shall provide, in addition to the reserve
established by Section 5.1, for the sufficient funds to provide a sufficient balance to
meet projected expenses for payment of claims during the ensuing fiscal year.
Section 5.3: A designated claims administration firmor is authorized to be
retained and said firm administrator is hereby granted authorization to make
payments and settlements of workers’ compensation claims made against the
Sanitation DistrictOC San in an amount not to exceed $5,000.00 per claimant. Said
firm administrator shall be retained in accordance with the terms and conditions set
forth in an agreement approved by the General Counsel.
Section 5.4: The Director of Human Resources or designee is authorized to
review and make full settlement of any workers’ compensation claims made against
OC San by payment of an amount not to exceed $25,000.00 per claim.
In addition to special legal counsel selected by the Sanitation District's
Workers' Compensation Administrator, the General Counsel is authorized to
retain the services of special legal counsel for purposes of representing the
Sanitation District in the defense of any workers' compensation claim, wherein the
General Counsel determines that specialized expertise is desirable or that the
workload requires the utilization of outside counsel.
Section 5.5: A Committee comprised of the General Manager or designee,
Assistant General Manager (Director of Finance & Administrative Services) or
designee, and Director of Human Resources or designee A Committee comprised of
the General Manager, or his designee, Director of Finance and Admin istrative
Services, and the Sanitation District's Risk Manager are authorized to review and
make full settlement of any workers' compensation claim made against the
OC SAN 21-XX-9
Sanitation DistrictOC San resulting in a recommended settlement by negotiation
by payment of a sum not to exceed $50,000.00per claim, in addition to the actual
medical expensess and associated costs to include but not limited to medical and
psychological treatment, review, devices, medication, physical therapy, and,
temporary disability payments, and permanent disability payments per claimper
claimant. In the event a claim results in litigation,whichlitigation, which is being
legally defended by specialized counsel other than the Sanitation DistrictOC San's
General Counsel, this Committee shall review and provide the approval to the
Sanitation DistrictOC San's special legal counsel within the same limits.
Section 5. 6: All workers’ compensation claims resulting in a recommended
settlement by negotiation or stipulation in an amount exceeding $50,000.00, in
addition to the actual medical expenses and associated costs to include but not
limited to medical and psychological treatment, review, devices, medication, physical
therapy, and, temporary disability payments,andpayments, and permanent disability
payments per claimper claimant , shall be submitted to and approved by the Board
of Directors of OC San prior to settlement payments being made.
Section 5.7: In addition to specialized legal counsel selected by the DistrictOC
San, the General Manager is authorized to retain the services of specialized legal
counsel for purposes of representing the DistrictOC San in the defense of any workers’
compensation claim, wherein the General Manager determines that specialized
expertise is desirable, and the utilization of outside counsel is required.
Section 6.1: This Resolution supersedes Resolution No. OCSD 11-0498-
23 , which shall be repealed in its entirety as of the date this Resolution becomes
effective. In the event this Resolution does not become effective, Resolution No.
98-23 OCSD 11-04shall remain in full force and effect.
Section 6.2: This Resolution is effective immediately upon adoption.
PASSED AND ADOPTED at a regular meeting of the Board of Directors of the Orange
County Sanitation District held March 24, 2021Regular Meeting held March 23, 2011.
David John Shawver
Chairman of the Board of Directors
Chair
ATTEST :
Kelly A. Lore, MMC
Clerk of the Board
OC SAN 21-XX-1
RESOLUTION NO. OC SAN 21-XX
A RESOLUTION OF THE BOARD OF DIRECTORS OF ORANGE
COUNTY SANITATION DISTRICT ADOPTING PROCEDURES
FOR SETTLEMENT OF CLAIMS MADE AGAINST THE
ORANGE COUNTY SANITATION DISTRICT SETTLEMENT
OF CLAIMS MADE BY THE ORANGE COUNTY SANITATION
DISTRICT; COLLECTION OF DELINQUENT ACCOUNTS
OWING TO THE ORANGE COUNTY SANITATION DISTRICT:
SETTLEMENT OF CIVIL OR ADMINISTRATIVE
ENFORCEMENT ACTIONS; AND SETTLEMENT OF
WORKERS' COMPENSATION ACTIONS, AND REPEALING
RESOLUTION NO. OCSD 11-04
WHEREAS claims for damages alleging personal injuries, bodily injuries,
including death, and damages to real and personal property, are periodically made
against Orange County Sanitation District (OC San); and,
WHEREAS OC San presently has liability insurance in force with a significant
self-insured retention, having previously been self-insured ; and,
WHEREAS OC San has the need for the retention of claims administration
services and legal counsel who shall be vested with certain limited authority to
accomplish a favorable disposition of claims made against OC San; and,
WHEREAS claims for workers' compensation damages alleging personal
injuries, including death, are periodically made against OC San; and,
WHEREAS OC San presently has major stop loss workers' compensation
insurance in force; and,
WHEREAS OC San has retained a claims administration service firm and special
legal counsel who shall be vested with certain limited authority to accomplish a
favorable disposition of workers' compensation claims made against OC San as
provided herein; and
WHEREAS cost efficiency relating to resolution of workers' compensation claims
can be greatly improved by the adopt ion of certain policies relating to the resolution of
said claims; and
W HEREAS Government Code Section 935.4 authorizes the Board of Directors
to delegate by resolution the authority to an employee to settle pre-litigation claims
OC SAN 21-XX-2
against OC San up to $50,000; and
W HEREAS Government Code section 935.2 authorizes the Board of Directors
to delegate by resolution the authority to a committee of at least three members to
settle pre-litigation claims; and
W HEREAS Government Code Section 949 authorizes the Board of Directors to
delegate authority to an employee or its attorney to settle lawsuits; and
W HEREAS OC San has occasion to seek recovery against persons or entities
who have caused loss or damage to OC San, who have been assessed fines ,
charges, or special fees relating to their use of OC San facilities, or who have been
the subject of civil or administrative enforcement proceedings for violation of OC
San's Wastewater Discharge Regulations Ordinance; and
W HEREAS in the course of conducting the business affairs of OC San, certain
accounts receivable or other obligations owing to OC San become delinquent, and in
fact, uncollectible; and
W HEREAS cost efficiency relating to collection of delinquent accounts can be
greatly improved by the adoption of certain policies relating to the collection of said
accounts; and
W HEREAS the Board of Directors desires to update, amend, and
reestablish procedures for the administration of claims against and by OC San.
NOW, THEREFORE, the Board of Directors of Orange County Sanitation
District, DOES HEREBY DETERMINE, RESOLV E AND ORDER:
OC SAN 21-XX-3
ARTICLE I
SETTLEMENT OF LIABILITY CLAIMSMADE
AGAINST THE
ORANGE COUNT Y SANITATION DISTRICT
Section 1.1: A liability reserve has been established for the payment of claims
made against OC San. Said reserve shall continue to be provided in each annual
budget to ensure that sufficient funds are on deposit to provide for payment of those
amounts incurred as a liability loss or expense.
Section 1.2: Each annual budget shall provide, in addition to the reserve
established by Section 1.1, for the necessary funds to provide a sufficient balance to
meet projected expenses for loss and payment of claims during the ensuing fiscal
year.
Section 1.3: A claims administration firm is authorized to be retained, and said
firm is hereby granted authorization to make payments and settlements of claims
made against OC San in an amount not to exceed $5,000.00 per claimant. Said firm
shall be retained in accordance with the terms and conditions set forth in an
agreement approved by the General Counsel.
Section 1.4: A Committee comprised of the General Manager or his designee
and Director of Finance and Administrative Services are authorized to review and
make full settlement of any claims made against OC San for contract or liability
damages not otherwise covered by insurance by payment of a sum not to exceed
$50,000.00 per claimant. In the event a claim results in litigation, which is being
legally defended by other than OC San's General Counsel, this Committee shall
review and provide the approval to OC San's special legal counsel within the same
limits.
Section 1.5: All claims for damages resulting in a judgment or a recommended
settlement by negotiation in an amount exceeding $50,000.00 per claimant, shall be
submitted to, and approved by the Board of Directors of OC San prior to settlement
payments being made.
Section 1.6: The General Counsel, with concurrence of the General Manager,
is authorized to retain the services of special legal counsel for purposes of
representing OC San in the defense of any claim or matter of litigation, whenever it
is determined that specialized expertise or experience is desirable, a conflict of
interest exists or could arise with the Office of General Counsel, or that the workload
of the Office of General Counsel requires the utilization of special counsel.
OC SAN 21-XX-4
ARTICLE II
COLLECTION OF DELINQUENT OBLIGATIONS OWING TO
THE ORANGE COUNTY SANITATION DISTRICT
Section 2. 1: The Director of Finance and Administrative Services is authorized
to write off as an uncollectible debt any delinquent obligation owing to OC San in
excess of 90 days and not exceeding the sum of $25,000.00.
Section 2.2: The Director of Finance and Administrative Services, in his
discretion, is authorized to assign for collection to a person or firm of his choosing,
any delinquent obligation owing to OC San in excess of 45 days and not exceeding
the sum of $100,000.00. Ninety (90) days after assigning the obligation for collection,
the Director of Finance and Administrative Services is authorized to write off as an
uncollectible debt any portion of the obligation which is still outstanding.
Section 2.3: The Director of Finance and Administrative Services shall forward
any delinquent obligation in excess of $100,000.00 to the General Counsel for OC
San, who shall submit his recommendation to the Board of Directors as to the method
of collection or disposition of said account.
Section 2.4: The Director of Finance and Administrative Services, in his
discretion, is authorized to file the necessary proceedings in the small claims court of
the appropriate judicial district of the County of Orange, in order to collect any
delinquent obligation owing to OC San in excess of 45 days and not exceeding the
sum of $5,000.00. Upon obtaining a judgment in favor of OC San, the Director of
Finance and Administrative Services and General Counsel shall take all legal
measures necessary to enforce the terms of the judgment. Ninety (90) days after
receiving a final judgment in favor of OC San, the Director of Finance and
Administrative Services, with the concurrence of the General Counsel, is authorized
to write off as an uncollectible debt, any portion of the obligation which is still
outstanding.
Section 2.5: Notwithstanding the authority provided in Sections 2.2 and 2.3
above, any obligation owing to OC San, not exceeding the sum of $100,000.00, may
be compromised by acceptance of a sum less than the full amount due or may be
written off as uncollectible upon that determination being made, after investigation
by a Committee comprised of the General Manager, or his designee, and the Director
of Finance and Administrative Services.
Section 2.6: In addition to the above authorization, the Director of Finance
and Administrative Services is directed to exercise all available lawful methods to
ensure prompt and full recovery of all obligations owing to OC San.
OC SAN 21-XX-5
Section 2.7: The Director of Finance and Administrative Services is authorized
to offset against any sums held on deposit by OC San on behalf of any person or
entity who owes a delinquent obligation to OC San.
Section 2.8: The Director of Finance and Administrative Services is authorized
to withhold the approval of any such permits otherwise to be issued by OC San to
any person or entity who has an outstanding debt obligation owing to OC San until
such time as said debt obligation is paid in full.
Section 2.9: Delinquent obligations, as used in this Resolution, shall include
any invoice submitted by OC San for services rendered or for reimbursement of
damages caused to OC San property or personnel, which has not been paid within:
(a) The time prescribed by OC San Ordinance or Resolution;
(b) Forty-five (45) days from the date of invoice, whichever is later.
ARTICLE Ill
COLLECTION OF FEES AND CHARGES RELATING
TO INDUSTRIAL WASTE DISCHARGES
Section 3.1: In the event any fees or charges, up to the amount of $100 ,000.00,
are owed by an Industrial Waste Permittee and are delinquent or in dispute between
the Permittee and OC San, a Committee comprised of the Director of Finance and
Administrative Services, and Director of Environmental Services are authorized to
negotiate and enter into, on behalf of OC San, a settlement agreement relating to the
financial obligation owing to OC San. This Section shall not apply to enforcement
actions which are specifically provided for in Article IV below. Said agreement shall
be based upon a showing of good cause and a reasonable dispute between OC San
and the Permittee and can provide for acceptance of a sum less than the full amount
claimed as due by OC San. This agreement may be entered into prior to or during the
pendency of any litigation filed by OC San to collect the amount owed.
Section 3.2: Upon written request and establishment of good cause by an
Industrial Waste Permittee, the Committee of the General Manager, or his designee,
the Director of Finance and Administrative Services, and Director of Environmental
Services, may negotiate and enter into a deferred payment agreement with the
Permittee in accordance with the guidelines established herein. Said agreement may
OC SAN 21-XX-6
be incorporated as part of, or separate and in addition to, any enforcement
compliance agreements authorized by the provisions of OC San's Wastewater
Discharge Regulations Ordinance.
Section 3.2.1: The installment payment agreement shall be for a maximum
term not to exceed 24 months. The agreement shall provide for payment of interest
on the principal amount owing at a rate not exceeding the higher of:
(a) Ten (10%) percent per annum; or
(b) Five (5%) percent per annum , plus the rate prevailing on the 25th
day of the month preceding the earlier of:
(i) The date of execution of the contract to make the loan or
forbearance; or
(ii) The date of making the loan or forbearance. (Established by
the Federal Reserve Bank of San Francisco on advances to
member banks under Sections 13 and 13(a) of the Federal
Reserve Act (commonly referred to as the "discount" rate).
The agreement shall provide for payment of all costs of preparing and
administering the payment agreement, including legal and administrative costs.
Section 3.2.2: The agreement shall stipulate the penalties to which the
Permittee shall be subjected in the event of nonpayment of any of the payments
specified in the agreement, including initiation of legal action or permit suspension or
revocation, as recommended by the General Counsel and the Director of
Environmental Services.
Section 3.3: If the delinquent obligation is greater than $100,000.00, any
compromise settlement or any deferred payment agreement shall be submitted to and
approved by the Board of Directors, who shall prescribe the terms and conditions.
OC SAN 21-XX-7
ARTICLE IV
SETTLEMENT OF CIVIL ADMINISTRATIVE
ENFORCEMENT ACTIONS
Section 4.1: In the event OC San initiates or intends to initiate any civil or
administrative enforcement actions based upon alleged violations of OC San's
Wastewater Discharge Regulations Ordinance, a Committee comprised of the
General Manager, or his designee, the Director of Finance and Administrative
Services, and Director of Environmental Services are authorized to negotiate and
enter into, on behalf of OC San, a settlement agreement , which may include both
payment to OC San in an amount up to $100 ,000.00, and enforcement compliance
orders deemed appropriate to ensure compliance with the Wastewater Discharge
Regulations Ordinance. This agreement may be entered into prior to or during the
pendency of any administrative proceeding or litigation enforcement action.
Section 4.2: The Committee of the General Manager, Director of Finance and
Administrative Services, and Director of Environmental Services may negotiate and
enter into a settlement agreement which includes a schedule of payments over a
period of time not to exceed 24 months, by the person or entity which is the subject
of the enforcement action. The agreement shall provide for payment of interest on
the principal amount owing at a rate not exceeding the higher of:
(a) Ten (10%) percent per annum; or
(b) Five (5%) percent per annum, plus the rate prevailing on the 25th
day of the month preceding the earlier of:
(i) The date of execution of the contract to make the loan or
forbearance; or
(ii) The date of making the loan or forbearance.
(Established by the Federal Reserve Bank of San
Francisco on advances to member banks under Sections
13 and 13(a) of the Federal Reserve Act (commonly
referred to as the "discount" rate).)
Section 4.3: If the proposed settlement involves the payment of an amount
greater than $100 ,000.00, the settlement shall be submitted for approval by the
Board of Directors of OC San.
OC SAN 21-XX-8
ARTICLE V
SETTLEMENT OF WORKERS' COMPENSATION
CLAIMS MADE AGAI NST THE
ORANGE COUNTY SANITATION DISTRICT
Section 5. 1: A workers’ compensation liability reserve has been established
for the payment of workers’ compensation claims made against OC San. Said reserve
shall continue to be provided in each annual budget to ensure that sufficient funds are
available to provide for payment of the amounts incurred as a workers’ compensation
liability loss or expense.
Section 5. 2: Each annual budget shall provide, in addition to the reserve
established by Section 5.1, for the sufficient funds to provide a sufficient balance to
meet projected expenses for payment of claims during the ensuing fiscal year.
Section 5.3: A designated claims administrator is authorized to be retained
and said administrator is hereby granted authorization to make payments and
settlements of workers’ compensation claims made against OC San in an amount
not to exceed $5,000.00 per claim. Said administrator shall be retained in
accordance with the terms and conditions set forth in an agreement approved by
the General Counsel.
Section 5.4: The Director of Human Resources or designee is authorized to
review and make full settlement of any workers’ compensation claims made against
OC San by payment of an amount not to exceed $25,000.00 per claim.
Section 5.5: A Committee comprised of the General Manager or designee,
Assistant General Manager (Director of Finance & Administrative Services) or
designee, and Director of Human Resources or designee are authorized to review
and make full settlement of any workers' compensation claim made against OC
San resulting in a recommended settlement by negotiation by payment of a sum not
to exceed $50,000.00per claim, in addition to the medical expenses and
associated costs to include but not limited to medical and psychological treatment,
review, devices, medication, physical therapy,, temporary disability payments, and
permanent disability payments per claim. In the event a claim results in litigation,
which is being legally defended by specialized counsel other than OC San's
General Counsel, this Committee shall review and provide the approval to OC
San's special legal counsel within the same limits.
Section 5. 6: All workers’ compensation claims resulting in a recommended
settlement by negotiation in an amount exceeding $50,000.00, in addition to the
medical expenses and associated costs to include but not limited to medical and
psychological treatment, review, devices, medication, physical therapy, temporary
disability payments, and permanent disability payments per claim, shall be submitted
to and approved by the Board of Directors of OC San prior to settlement payments
OC SAN 21-XX-9
being made.
Section 5.7: In addition to specialized legal counsel selected by OC San, the
General Manager is authorized to retain the services of specialized legal counsel for
purposes of representing OC San in the defense of any workers’ compensation claim,
wherein the General Manager determines that specialized expertise is desirable, and
the utilization of outside counsel is required.
Section 6.1: This Resolution supersedes Resolution No. OCSD 11-04,
which shall be repealed in its entirety as of the date this Resolution becomes
effective. In the event this Resolution does not become effective, Resolution No.
OCSD 11-04 shall remain in full force and effect.
Section 6.2: This Resolution is effective immediately upon adoption.
PASSED AND ADOPTED at a regular meeting of the Board of Directors of the Orange
County Sanitation District held March 24, 2021.
David John Shawver
Chairman of the Board of Directors
ATTEST:
Kelly A. Lore, MMC
Clerk of the Board
OC SAN 21-XX-10
STATE OF CALIFORNIA )
) ss
COUNTY OF ORANGE )
I, Kelly A. Lore, Clerk of the Board of Directors of the Orange County Sanitation District,
do hereby certify that the foregoing Resolution No. OC SAN 21-XX was passed and
adopted at a regular meeting of said Board on the 24th day of March 2021, 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 24th day of March 2021.
Kelly A. Lore, MMC
Clerk of the Board of Directors
Orange County Sanitation District
ADMINISTRATION COMMITTEE
Agenda Report
Administration Building
10844 Ellis Avenue
Fountain Valley, CA 92708
(714) 593-7433
File #:2021-1469 Agenda Date:3/10/2021 Agenda Item No:4.
FROM:James D. Herberg, General Manager
Originator: Lorenzo Tyner, Assistant General Manager
SUBJECT:
WASTEWATER REFUNDING REVENUE OBLIGATIONS, SERIES 2021A
GENERAL MANAGER'S RECOMMENDATION
RECOMMENDATION: Recommend to the Board of Directors to:
Authorize the General Manager to issue new fixed rate Certificates of Participation, to be referred to
as Wastewater Refunding Revenue Obligations, in (1) an amount sufficient to refund $102,200,000 of
Revenue Refunding Certificate Anticipation Notes, Series 2018A maturing on August 15, 2021 and
(2) an additional amount sufficient to refund, subject to market conditions, up to $61,575,000 of
Wastewater Refunding Revenue Obligations, Series 2011A.
BACKGROUND
Revenue Refunding Certificate Anticipation Notes, Series 2018A
The borrowing cost on the current outstanding Revenue Refunding Certificate Anticipation Notes
Series 2018A (2018A CANs) is fixed for 33.5 months and the entire $102,200,000 plus interest
becomes due and payable on August 15, 2021. The Orange County Sanitation District (Sanitation
District) is responsible for a total repayment, including interest due, of $104,755,000 or the Sanitation
District could choose to refinance the 2018A CANs. Due to the current near historically low tax-
exempt cost of fixed rate debt, staff does not recommend the use of $105 million of reserves to repay
the 2018A CANs.
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 (“2006 Fixed Rate”). For the initial 27 months
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 of the markets in the late summer of 2008, there was a significant increase in the
variable rate borrowing cost to the Sanitation District, including many other municipal variable rate
borrowers, with the 2006 COPs averaging 4.29% (or 1.56% above the SIFMA index) for the period
between September 2008 and December 2008. The amount of the variable rate cost increase 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. Even with the increase in interest rates
during this period of unprecedented stress, the 4.29% average cost was still lower than the 2006
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OC6SAN
ORANGE COUNTY SANITATION DISTRICT
File #:2021-1469 Agenda Date:3/10/2021 Agenda Item No:4.
during this period of unprecedented stress,the 4.29%average cost was still lower than the 2006
Fixed Rate of 4.54%.
In December 2008,the Sanitation District proactively refunded the 2006 COPs with the fixed rate
Refunding COP Series 2008C Certificate Anticipation Notes (2008C CANs)yielding 0.98%for a one-
year period to reduce its exposure to then higher and more volatile variable rate costs and to avoid
relying on liquidity support from weakening banks.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 a month later.Since the 2008C CANs
issuance,the Sanitation District completed five additional one-year refinancings at progressively
lower yields,followed by two 25-month refinancings starting in 2014,and with the most recent 33.5-
month refinancing in 2018, as summarized below:
Series Principal Amount Maturity Yield All-in Cost
2009B $ 165,865,000 1 Year 0.370%0.559%
2010B 154,665,000 1 Year 0.360 0.525
2011B 143,205,000 1 Year 0.225 0.399
2012C 131,700,000 1 Year 0.210 0.410
2013A 129,625,000 1 Year 0.170 0.390
2014B 120,850,000 25.0 months 0.320 0.523
2016B 109,875,000 25.5 months 0.840 1.002
2018A 102,200,000 33.5 months 1.940 2.134
Wastewater Refunding Revenue Obligations Series 2011A
The Sanitation District’s Wastewater Refunding Revenue Obligations Series 2011A (2011A Revenue
Obligations)are subject to optional redemption on August 1,2021.As interest rates are now lower
than in 2011,there is the potential opportunity to refinance a portion of the outstanding 2011A
Revenue Obligations to reduce interest costs for the Sanitation District.Under current market
conditions,a refunding of $61,575,000 of the Series 2011A Revenue Obligations would generate
more than 3%net present value savings (the minimum percentage required by the Sanitation
District’s debt policy).
Shorter term tax-exempt interest rates were consistently low between 2011 and 2016,then these
rates steadily increased until 2018.Since 2018,shorter term tax-exempt rates have been in a
downward trend as shown in the history for the AAA General Obligation Municipal Market Data Index
for 3-year (reflective of the average life of the potential 2011A Revenue Obligations refunding
candidates)and 5-year tax-exempt maturities (reflective of the maximum maturity of the potential
2011A Revenue Obligations refunding candidates).Please see Exhibit A on the AAA General
Obligation Municipal Market Data Index attachment.
RELEVANT STANDARDS
·Sanitation District Debt Policy -Financial Management Policy and Procedure 201-3-1;
restructuring outstanding debt is desirable and refunding to achieve debt service savings
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PROBLEM
2018A CANs
The 2018A CANs are due and payable on August 15,2021 in the amount of $104,755,000.The
2018A CANs were issued with a short-term 33.5-month rate with the expectation that upon maturity
the issue would be refinanced.
2011A Revenue Obligations
$61,575,000 of the 2011A Revenue Obligations are currently accruing interest at rates ranging from
3.25%to 5.00%,which are higher than current market yields,and will soon be available for optional
redemption on August 1, 2021.
PROPOSED SOLUTION
2018A CANs
The issuance of long-term fixed rate debt would allow the Sanitation District to repay the 2018A
CANs at a low cost (1.51%based on current market conditions as of February 24,2021)and avoid
using $105 million of reserves for such purpose.
2011A Revenue Obligations
The Sanitation District could refund up to $61,575,000 of the 2011A Revenue Obligations for net
present value debt service savings of approximately $7.24 million (equal to 11.8%of refunded
principal),based on current market conditions as of February 24,2021,with a matching refunding
amortization structure.
TIMING CONCERNS
2018A CANs
The Sanitation District must complete a refinancing by no later than August 15,2021;otherwise,
$105 million of reserves will be required to repay the 2018A CANs.
2011A Revenue Obligations
The Tax Cuts and Jobs Act of 2017 eliminated the ability of issuers to conduct tax-exempt advance
refundings (more than 90 days prior to the optional redemption date).However,the Sanitation
District can conduct a current refunding if the 2011A Revenue Obligations are redeemed no earlier
than 90 days before the August 1,2021 optional redemption date.A refunding past August 1,2021
would result in the Sanitation District continuing to pay interest costs above current market yields.
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RAMIFICATIONS OF NOT TAKING ACTION
2018A CANs
Not taking action by August 15,2021 would cause the Sanitation District to use its reserves to repay
the 2018A CANs or cause an “Event of Default”due to the non-repayment to lenders.The economic
ramification of an Event of Default would result in a downgrade in credit ratings,reduced access to
capital and higher costs of borrowing.
2011A Revenue Obligations
Not refunding the 2011A Revenue Obligations would result in the Sanitation District continuing to pay
above market interest costs.
PRIOR COMMITTEE/BOARD ACTIONS
September 2018 -Approved Resolution No.OCSD 18-17,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 Revenue Refunding Certificate Anticipation Notes,Series 2018A,such Notes evidencing
principal in an aggregate amount of not to exceed $109,875,000,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.
December 2016 -Approved Resolution No.OCSD 16-32,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 Orange County Sanitation District Wastewater
Refunding Revenue Obligations,Series 2017A,authorizing the execution and delivery of such
Revenue Obligations evidencing principal in an aggregate amount not to exceed $91,620,000,
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
2018A CANs
The issuance of long-term fixed rate debt to refund the 2018A CANs will eliminate any future 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.
Most recently,tax-exempt rates have reached historic lows due to the lack of supply of tax-exempt
debt coupled with more municipalities selling taxable debt.Current fixed rates are near historical low
yields as shown in the history for the AAA General Obligation Municipal Market Data Index for 10-
year (close to the 8.6 year average life of fixing out the 2018A CANs)and 15-year tax-exempt
maturities (reflective of the maximum maturity of fixing out the 2018A CANs).Please see Exhibit BOrange County Sanitation District Printed on 3/3/2021Page 4 of 7
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maturities (reflective of the maximum maturity of fixing out the 2018A CANs).Please see Exhibit B
on the AAA General Obligation Municipal Market Data Index attachment.
In 2006,the Sanitation District intended to partially hedge against fluctuating investment portfolio
earnings as the variable rates on the 2006 COPs were expected to move in tandem with changes in
short-term interest rates.The 2006 COPs and subsequent CANs refinancings have mirrored short-
term tax-exempt variable rate costs.The issuance of fixed rate debt to refund the 2018A CANS
would remove the interest rate hedge originally desired by the Sanitation District.
When the 2006 COPs were issued,the expectation of the Sanitation District was to not only hedge
investment interest rate risk,but to also reduce the risk from rising interest rates resets by
implementing an Accelerated Rate Management (ARM)program.Between 2006 and 2012 and in
2016,the ARM program used accrued savings,resulting from borrowing at rates lower than the 2006
Fixed Rate of 4.54%,to reduce the outstanding amount of debt at the time of each refinancing.With
less outstanding debt,the Sanitation District likewise reduced its interest rate risk (if higher interest
rates were to occur,the negative impact would be mitigated as the higher interest cost would be
calculated on a smaller outstanding amount).The implementation of the ARM program since the
issuance of the 2006 COPs has (1)reduced the outstanding principal by nearly $30 million compared
to a 2006 fixed rate amortization and (2)decreased the interest rate risk to the Sanitation District as
the break-even rate (the average future interest rate for the remaining debt which would result in no
difference in cost from issuing fixed rate debt in 2006)is now over 15.6%.The original variable rate
structure of the 2006 COPs and the past nine CANs refinancings have already saved the Sanitation
District over $68 million compared to the alternative of the Sanitation District issuing fixed rate debt in
2006.
The Sanitation District could refinance the 2018A CANs with another CANs financing as short-term
interest rates are currently extremely low and future short-term interest rates may continue to stay
low;however,the associated upfront costs of refinancing on a shrinking amount of outstanding
principal makes every dollar of cost more impactful.A refinancing of the 2018A CANs with other
variable debt products is also possible,but would also require the payment of ongoing costs,most
notably the relatively high bank liquidity fees that require periodic renewals (generally every one to
five years);in addition,to the risk of rising interest rates.Therefore,staff is recommending the
refunding of the 2018A CANs with longer term fixed rate debt having a final maturity date of February
1,2036 (which is no longer than the final maturity of the original 2006 COPs).The new refunding
debt is expected to be structured with level debt service which based on market conditions as of
February 24, 2021, is currently estimated to be approximately $7.61 million per year.
2011A Revenue Obligations
The Sanitation District currently has ten series of debt issuances outstanding (including the 2018A
CANs) in the par amount of $909,620,000 as shown in the table below:
Outstanding Par Amount (1)
Series 2018A CANs $ 102,200,000
Series 2017A Refunding 65,815,000
Series 2016A Refunding 136,830,000
Series 2015A Refunding 127,510,000
Series 2014A Refunding 56,080,000
Series 2012B Refunding 8,170,000
Series 2012A Refunding 100,645,000
Series 2011A Refunding 75,370,000
Series 2010C 157,000,000
Series 2010A 80,000,000
Total:$ 909,620,000
(1) As of February 15, 2021
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Outstanding Par Amount (1)
Series 2018A CANs $ 102,200,000
Series 2017A Refunding 65,815,000
Series 2016A Refunding 136,830,000
Series 2015A Refunding 127,510,000
Series 2014A Refunding 56,080,000
Series 2012B Refunding 8,170,000
Series 2012A Refunding 100,645,000
Series 2011A Refunding 75,370,000
Series 2010C 157,000,000
Series 2010A 80,000,000
Total:$ 909,620,000
(1) As of February 15, 2021
Depending on market conditions,staff is proposing to refund up to $61,575,000 of the 2011A
Revenue Obligations maturing in years 2023 through 2026 with annual coupon rates ranging
between 3.25 to 5.00%, as shown in the table below:
Maturity Principal Amount Coupon Call Date
2/1/2023 $ 14,435,000 4.00%08/01/2021
2/1/2024 15,055,000 5.00%08/01/2021
2/1/2025 15,760,000 3.25%08/01/2021
2/1/2026 16,325,000 5.00%08/01/2021
Total:$ 61,575,000
Timeline
Assuming that staff receives approval to pursue the refinancings of the 2018A CANs and 2011A
Revenue Obligations,staff will return to the Administration Committee in May 2021 with financing
documents to complete the refinancings.There is the possibility that interest rates may change
before May and,at the time of approval of the financing documents and based on market conditions
at that time,staff may recommend different refinancing structures.The refundings of the 2018A
CANs and 2011A Revenue Obligations can be combined into one financing which will minimize
issuance costs and be sold on a competitive basis in order to obtain the lowest financing cost
possible.
Staff and consultants will be available to answer any questions at the Administration Committee
meeting.
Following is a chart listing the remaining steps to be completed for the debt refinancings:
May:
-Board approval of legal and disclosure documents
-Financing Corporation approval of legal and disclosure documents
June:
-Request ratings from bond rating agencies
-Rating agency discussions
July:
-Receive ratings from rating agencies
-Marketing and sale through a competitive sale process
-Closing
-Begin debt administration
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File #:2021-1469 Agenda Date:3/10/2021 Agenda Item No:4.
May:-Board approval of legal and disclosure documents-Financing Corporation approval of legal and disclosure documents
June:
-Request ratings from bond rating agencies
-Rating agency discussions
July:
-Receive ratings from rating agencies
-Marketing and sale through a competitive sale process
-Closing
-Begin debt administration
All costs involved with the refinancings,including costs for Norton Rose Fulbright,Special Counsel
and Disclosure Counsel and Public Resources Advisory Group,Municipal Advisor,will be paid from
the proceeds of the new refunding issue.
ATTACHMENT
The following attachment(s)may be viewed on-line at the OC San website (www.ocsan.gov)with the complete agenda
package:
·AAA General Obligation Municipal Market Data Index
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AAA General Obligation Municipal Market Data Index
Exhibit A
Exhibit B
0.00%
0.50%
1.00%
1.50%
2.00%
2.50%
3.00%
10
/
2
0
1
1
10
/
2
0
1
2
10
/
2
0
1
3
10
/
2
0
1
4
10
/
2
0
1
5
10
/
2
0
1
6
10
/
2
0
1
7
10
/
2
0
1
8
10
/
2
0
1
9
10
/
2
0
2
0
AAA GO MMD Index (3-year and 5-year)
October 3, 2011 to February 24, 2021
3-Year 5-Year
0.00%
1.00%
2.00%
3.00%
4.00%
5.00%
6.00%
03
/
2
0
0
6
03
/
2
0
0
7
03
/
2
0
0
8
03
/
2
0
0
9
03
/
2
0
1
0
03
/
2
0
1
1
03
/
2
0
1
2
03
/
2
0
1
3
03
/
2
0
1
4
03
/
2
0
1
5
03
/
2
0
1
6
03
/
2
0
1
7
03
/
2
0
1
8
03
/
2
0
1
9
03
/
2
0
2
0
AAA GO MMD Index (10-year and 15-year)
March 8, 2006 to February 24, 2021
10-Year 15-Year
[-
[-
ADMINISTRATION COMMITTEE
Agenda Report
Administration Building
10844 Ellis Avenue
Fountain Valley, CA 92708
(714) 593-7433
File #:2021-1511 Agenda Date:3/10/2021 Agenda Item No:5.
FROM:James D. Herberg, General Manager
Originator: Lorenzo Tyner, Assistant General Manager
SUBJECT:
OVERVIEW OF PROPERTY - LIABILITY INSURANCE
GENERAL MANAGER'S RECOMMENDATION
RECOMMENDATION:
Information Item.
BACKGROUND
Staff will provide an informational presentation on the Orange County Sanitation District’s (Sanitation
District) major insurance policies. The process of renewal begins each January, and final quotes are
typically received in June, shortly before the beginning of the new fiscal year.
The Sanitation District budget provides funds for the renewal of the following four (4) major
insurances for Sanitation District operations:
1)Excess General Liability Insurance
The Sanitation District Excess General Liability Insurance Program is currently provided
through the Alliant National Municipal Liability Program (ANML). The Sanitation District has
participated in the ANML, and its predecessor namesake, the California Municipal Excess
Liability Program (CAMEL) since FY 1996-97.
This program currently provides the Sanitation District with a $40 million dollar limit of
comprehensive coverage for municipal liability, bodily injury and property damage, and
personal injury. The program was structured to also include Employment Practices and Public
Officials Errors & Omissions coverage. The $40 million dollar coverage has a self-insured
deductible of $750,000. Since 1997, the Employment Practices portion of coverage has been
enhanced from a $2 million dollar sub-limit to the full policy limit of $40 million dollars.
As part of the renewal process, the Sanitation District will look at various retention and
coverage levels for the Excess General Liability Program that will provide the most effective
coverage at the best value to the Sanitation District.
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OC6SAN
ORANGE COUNTY SANITATION DISTRICT
File #:2021-1511 Agenda Date:3/10/2021 Agenda Item No:5.
2)Excess Workers’ Compensation
The Excess Workers’Compensation insurance coverage is with the Public Risk Innovation,
Solutions,and Management (PRISM).The Sanitation District has participated in this program
or its predecessor since 2003.The Excess Workers’Compensation program currently
provides “Statutory”(unlimited)coverage with a self-insured retention (SIR),or deductible,of
$1 million dollars.The use of Excess Workers’Compensation Insurance dates back to the
late 1980’s.
3)All-Risk Property and Flood Insurance (Includes Boiler & Machinery Insurance)
The All-Risk Property and Flood Insurance Program (Property Insurance)provides
comprehensive coverage for much the Sanitation District’s real and personal property and
business interruption from perils including fire and flood.The most significant peril excluded is
earthquake (insured separately), as is the peril of pandemic.
To obtain property insurance,the Sanitation District participates in the Alliant Public Entity
Property Insurance Program (APIP),a group purchase insurance program with thousands of
public entity participants.In operation since the ‘90s,the program provides extreme buying
power for public agencies with a breadth of coverage not found in the open commercial
insurance market.For the Sanitation District,current Property Insurance limits are $800
million dollars for most perils other than flood,and $125 million dollars for flood,with many sub
-limits for various situations.Earthquake coverage is purchased separately for specific
buildings.In order to reach $800 million dollars in limits,the broker had to arrange for more
than a dozen different insurers. The SIR is $500,000 per occurrence for most types of losses.
The Boiler &Machinery Insurance Program,part of the property insurance,provides
comprehensive coverage for loss caused by machinery breakdown and explosion of steam
boilers or other covered process equipment,including damage to the equipment itself and
damage to other property caused by covered accidents.The current Boiler &Machinery
Insurance Program provides coverage of $100 million dollars per occurrence with deductibles
ranging from $25,000 to $350,000 for losses caused by covered machinery breakdown (e.g.,
motors,steam turbines,digesters,co-gen engines).Damages to the equipment,as well as
damages to other property and improvements caused by the machinery breakdown,are
covered by the Boiler &Machinery Insurance.This program augments the Sanitation District’s
All-Risk Property Insurance that covers perils such as fire and flood.
As part of the renewal process,the Sanitation District will look at various retention and
coverage levels for the All-Risk Property and Flood Insurance that will provide the most
effective coverage at the best value to the Sanitation District.
4)Earthquake Insurance
The Sanitation District purchases a separate earthquake policy with limits of $25MM on
specific buildings valued at ~$160MM deemed to be important to the operations of the
Sanitation District.The goal of the purchase is to provide limited cover for the peril of
earthquake in a manner that is relatively inexpensive so as to not put an excessive burden on
the budget.From time to time the Sanitation District considers adding structures to the
earthquake insurance schedule.
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File #:2021-1511 Agenda Date:3/10/2021 Agenda Item No:5.
RELEVANT STANDARDS
·Protect Orange County Sanitation District assets
ATTACHMENT
The following attachment(s)may be viewed on-line at the OC San website (www.ocsan.gov)with the complete agenda
package:
·Presentation
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3/2/2021
1
Overview of Property – Liability Insurance
Presented by:
Wally Ritchie,
Controller
Administration
Committee
March 10, 2021
Coverage for damages to third parties
Includes:
▫General Liability
▫Automobile Liability
▫Public Entity Errors and Omissions
−Professional Liability
−Directors and Officers Liability
−Employment Practices Liability
All coverage provided on an “Occurrence” Basis
Excess General Liability
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3/2/2021
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Policy Limits –Per Occurrence/Annual
Aggregate $ 40MM/$40MM
▫General:
▫Automobile:
▫E&O/D&O/EPL:
Policy Retentions $ 750,000
▫General:
▫Auto:
▫E&O/D&O/EPL:
Excess General Liability – Limits and Retentions
Page 3
Coverage for injuries to employees while in
the course and scope of employment
▫Limits Statutory
▫Retention $ 1,000,000
▫Payroll $69,871,030
Excess Workers’ Compensation
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Total Insurable Value: $2,175,238,885
Policy Limit: $ 800,000,000
Key Sublimits
▫Boiler & Machinery: $ 100,000,000
▫Business Interruption: $ 100,000,000
▫Flood Zones A&V: $ 25,000,000
▫Flood All Other Zones: $ 100,000,000
▫Builder’s Risk: $ 90,000,000
▫Cyber: $ 25,000,000
Deductible: $ 500,000
Property Insurance ‐Overview
Page 5
Current Coverage
▫Coverage for key buildings located at
both Plants 1 and 2
▫Coverage up to $25,000,000
▫Deductible 5%/$5MM Minimum
Earthquake Overview
Page 6
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3/2/2021
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Excess General Liability: $ 755,529
Excess Workers’ Compensation: $ 204,769
Property Insurance: $1,051,615
Earthquake: $ 98,707
Marine Vessel: $ 31,451
Total Premium: $2,142,071
Premiums
Page 7
Questions
?
Page 8
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8
ADMINISTRATION COMMITTEE
Agenda Report
Administration Building
10844 Ellis Avenue
Fountain Valley, CA 92708
(714) 593-7433
File #:2021-1501 Agenda Date:3/10/2021 Agenda Item No:6.
FROM:James D. Herberg, General Manager
Originator: Lorenzo Tyner, Assistant General Manager
SUBJECT:
FY 2021-22 ORANGE COUNTY SANITATION DISTRICT BUDGET UPDATE REVENUE
OVERVIEW
GENERAL MANAGER'S RECOMMENDATION
RECOMMENDATION:
Information Item.
BACKGROUND
Staff will provide an informational presentation on the revenues and reserves of the Orange County
Sanitation District’s Proposed Fiscal Year 2021-22 Budget Update.
The Proposed Budget will be presented for adoption at the June 23, 2021 Board of Directors
meeting.
ATTACHMENT
The following attachment(s) may be viewed on-line at the OC San website (www.ocsan.gov) with the complete agenda
package:
·FY 2021-22 Budget Update Revenue Detail
·Reserve Summary - FY 2020-21
·Presentation
Orange County Sanitation District Printed on 3/3/2021Page 1 of 1
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OC6SAN
ORANGE COUNTY SANITATION DISTRICT
1
FY 2021-22 Budget Update Revenue Detail
Revenue Summary (in millions)
Category 2020-21
Adopted
2021-22
Adopted
Revenues:
Service Fees 298.1 302.8
Permit User Fees 12.8 13.0
Capital Facility Capacity Charge 20.1 20.7
Property Taxes 99.9 102.0
Interest 13.2 13.1
Other Revenue 40.7 42.8
Debt Proceeds 0.0 0.0
Total Revenue $484.8 $494.4
OC San has a variety of revenue sources available for operating and capital expenses.
The major revenue sources are as follows:
• General Sewer Service Fees
• Industrial Waste Permit User Fees
• Capital Facilities Capacity Charges (CFCC)
• Property Taxes
• Interest Earnings
• Other Miscellaneous Revenue
• Debt Proceeds
2020-21 2021-22
General Service Fees –
User fees are ongoing fees for service paid by customers
connected to the sewer system. A property owner, or user, does
not pay user fees until connected to the sewer system and
receiving services. Once connected, a user is responsible for his
share of the system’s costs, both fixed and variable, in proportion
to his demand on the system. These fees are for both Single
Family Residences (SFR) and Multiple Family Residences
(MFR).
FY 2021-22 is the fourth year of the most recent five-year sewer
service fee rate schedule approved by the Board. The SFR rate
(the underlying basis for all sewer rates) was held flat in FY
2020-21 and will increase by 1.2 percent ($4) to $343 in FY
2021-22. These rates are still well below the average annual
sewer rate currently being charged throughout the state.
$298.1M $302.8M
2
2020-21 2021-22
Industrial Waste Permit User Fees –
Fees paid by large industrial and commercial properties owners
connected to the sewer system. These fees are for the owner’s
share of the system’s costs, both fixed and variable, in proportion
to his demand on the system.
Since the inception of the Permit User Fee program in 1970,
users of the District’s system that discharge high volumes or high
strength wastewater are required to obtain a discharge permit
and pay for the full cost of service.
$12.8M $13.0M
Capital Facilities Capacity Charges (CFCC) –
Capital Facilities Capacity Charge is a one-time, non-
discriminatory charge imposed at the time a building or structure
is newly connected to the District’s system, directly or indirectly,
or an existing structure or category of use is expanded or
increased. This charge pays for District facilities in existence at
the time the charge is imposed, or to pay for new facilities to be
constructed in the future, that are of benefit to the property being
charged.
$20.1M $20.7M
Property Taxes –
The County is permitted by State law (Proposition 13) to levy
taxes at 1% of full market value (at time of purchase) and can
increase the assessed value no more than 2% per year. The
District receives a share of the basic levy proportionate to what
was received in the 1976 to 1978 period less $3.5 million, the
amount that represents the State’s permanent annual diversion
from special districts to school districts that began in 1992-93.
The District’s share of this revenue is dedicated for the payment
of debt service.
$99.9M $102.0M
Interest Earnings –
Interest earnings are generated from the investment of
accumulated reserves consisting of a cash flow/contingency, a
capital improvement, a renewal/replacement, and a self-
insurance reserve.
$13.2M $13.1M
Other Revenue –
Other revenue includes solids handling and capital assessments
from the Irvine Ranch Water District (IRWD); and O&M sewer
services provided to IRWD, the Santa Ana Watershed Protection
Authority (SAWPA), and the Sunset Beach Sanitary District.
$40.7M $42.8M
3
2020-21 2021-22
Debt Proceeds –
Certificates of Participation (COPs) are the District’s primary
mechanism for financing capital projects. COPs are repayment
obligations based on a lease or installment sale agreement.
COPs are viewed by the State of California as a share in an
installment arrangement where the District serves as the
purchaser. No new debt issuances are projected in the near-
term.
$0.0M $0.0M
Financing
If it is necessary that OC San utilize debt financing to meet its total obligations and to meet
projected construction schedules, OC San uses long-term borrowing (Certificates of Participation
(COP)) for capital improvements that cannot be financed from current revenue. Before any new
debt is issued, the impact of debt service payments on total annual fixed costs is analyzed. No
new debt issuance is currently being planned.
OC San Maintains its AAA Rating
OC San maintains ratings of “AAA” from Standards and Poor, Moody’s and Fitch. A triple A rating
is the highest obtainable for any governmental agency. In order to maintain this rating, OC san
adheres to its Debt Policy and coverage ratios requirements. This Board-adopted policy serves
as the agency’s guide in the management of existing debt and in the issuance of future debt.
OC San Has Contractual Covenants
OC San has contractual covenants within the existing COP agreements which require minimum
coverage ratios of 1.25. The minimum coverage ratio is the ratio of net annual revenues available
for debt service requirements to total annual debt service requirements for all senior lien COP
debt. The coverage ratio for senior lien COP debt was approved at 3.99 for FY 2020-21.
Orange County Sanitation District
Reserve Summary - FY 2020-21
Orange County Sanitation District (OC San) has a Board of Directors Reserve Policy that sets forth seven criteria to
be used to determine its reserve level. As part of the OC San financial and operating process, we have developed
a Reserve Policy which governs the establishment of our reserve level and the use of those funds. To ensure an
adequate and diverse reserve policy, we have established seven different criteria. These are not seven different
reserves, but seven criteria used to set the total reserve level. Reserves can only be used with the approval of
the Board of Directors. Below is a brief summary of the OC San Reserve Criteria.
Reserve Policy Summary
Non-Discretionary
1) Debt Covenants and Other Requirements – Required by OC San bondholders – $94 million – RESTRICTED
This level is set by various bond covenants. As OC San issues debt, it is required to maintain certain levels
of reserves held specifically for repayment of that debt and cannot be reduced or used prior to repayment
of all outstanding debt issuances.
2) “Dry Period” – Property Tax Payments – 50% of Operating Costs – $87 million
The largest portion of OC San revenues are user fees, approximately $300 million. These fees are listed
on and collected through the County property tax bill. Since we receive payments twice each year, we
hold funds in reserve specifically to pay operating expenses pending receipt of those payments.
3) “Dry Period” – Property Tax Payments – 100% of August Debt Service Costs – $24 million
The largest portion of OC San revenues are user fees, approximately $300 million. These fees are listed
on and collected through the County property tax bill. Since we receive payments twice each year, we
hold funds in reserve specifically to pay debt service pending the receipt of those payments.
Discretionary
4) Operating Budget – 10% of the total Operating Budget as a Contingency – $18 million
We hold ten percent of our operating budget as an operating contingency for non-recurring and
unanticipated expenditures.
5) Capital Improvement Budget – 50% of the average 10-year CIP Program – $137 million
OC San currently has a ten-year, $2.7 billion Capital Improvement effort. We hold the equivalent of 5%
of that total as a contingency specifically related to these Capital Improvement Program efforts.
6) Rehabilitation and Refurbishment – $75 million
In 2002, OC San established a reserve level related to rehabilitation efforts at $50 million based on the
rehabilitation or replacement costs at that time. Although the total costs for rehabilitation or replacement
has increased substantially since 2002 as a result of the move to Full Secondary Treatment and the
Construction of GWRS, this reserve guideline has been increased. It will continue to increase 2% annually.
7) Catastrophic loss / Self-insurance – $100 million
OC San is Self-Insured for Catastrophic Loss. $100 million of the District’s total reserves are related to
holding funds for this category. Although OC San now has more than $11 billion in asset replacement
value and this level has been increased, it is potentially under-funded.
Current 2020-21 Reserve Policy Requirement $535 million
3/2/2021
1
Revenues & Reserves
Fiscal Year 2021‐22
Budget Update
Presented by:
Wally Ritchie,
Controller
Administration
Committee
March 10, 2021
Adopted
Revenues FY 20-21 FY 21-22
Fees & Charges $331 M $337 M
General Income $113 M $115 M
Other / Interagency $ 41 M$ 43 M
Debt Proceeds $ 0 M$ 0 M
Total Revenues $485 M $495 M
Four Major
Revenue
Categories
Page 2
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oc~SAN
ORANGE COUNTY SANITATION DISTRICT
3/2/2021
2
Fees and
Charges are
Majority of
Revenues Fees & Charges,
$331, 68%
General Income, $113 , 23%
Other / Interagency, $41 , 9%
Adopted Revenues FY 2020-21
$485M
Fees & Charges,
$337 , 68%
General
Income,
$115 , 23%
Other /
Interagency, $43 , 9%
Adopted Revenues FY 2021-22
$495M
Page 3
Adopted
FY 20-21 FY 21-22
General User Fees $ 298 M $ 303 M
Permit User Fees $ 13 M $ 13 M
Capital Facilities Capacity $ 20 M $ 21 M
Charges (CFC)
General User
Fees
Collected on
the Property
Tax Bill
is the Largest
Revenue
Source Total Fees & Charges $ 331 M $ 337 M
Page 4
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3/2/2021
3
Company Fee % of Total
House Foods America $1,595,677 0.47%
Stremicks Heritage Foods 782,334 0.23%
Pulmuone Wildwood, Inc. 778,107 0.23%
Newport Fab, LLC (Jazz Semiconductor) 589,702 0.17%
House Foods America Corp. (East) 415,677 0.12%
MCP Foods, Inc. 408,862 0.12%
Nor‐Cal Beverage, Inc. (Main) 396,810 0.12%
California State University ‐Fullerton 332,746 0.10%
Patriot Wastewater, LLC (Freedom CWT) 313,793 0.09%
Van Law Food Products, Inc. 306,275 0.09%
Top Ten Total Fees & Charges $5,919,983 1.74%
Top Ten
Industrial
Users
Page 5
Adopted
FY 20-21 FY 21-22
Property Taxes $ 100 M $ 102 M
Interest $ 13 M $ 13 M
General &
Other
Income
Total General Income $ 113 M $ 115 M
Other / Interagency $ 41 M $ 43 M
Page 6
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3/2/2021
4
Debt
Proceeds
to Support
CIP Program
No new money debt
issuances are projected
in the near term.
Page 7
Non‐Discretionary Reserves Millions
1) Operating Expense –Dry Period $ 87
2) Debt Service –Dry Period $ 24
3) Debt Service Requirements $ 94
Sub‐Total $ 205
Discretionary Reserves
4) Operating Contingencies $ 18
5) Capital Improvement Program $ 137
6) Catastrophe Funds $ 75
7) Replacement/Refurbishment $ 100
Sub‐Total $ 330
TOTAL $535
Reserve
Policy
Summary
for Fiscal
Year 2020‐21
Page 8
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8
3/2/2021
5
Discretionary Reserve Criteria
Operating Contingencies $ 18 M
Capital Improvement Program $ 137 M
Catastrophe Funds $ 100 M
Replacement/Refurbishment $ 75 M
Total $330 M
Total OCSD Assets $11 B
Percent Coverage 3.0%
OCSD
Reserve
Criteria
Summary
Page 9
Questions
?
Page 10
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10
ADMINISTRATION COMMITTEE
Agenda Report
Administration Building
10844 Ellis Avenue
Fountain Valley, CA 92708
(714) 593-7433
File #:2021-1519 Agenda Date:3/10/2021 Agenda Item No:7.
FROM:James D. Herberg, General Manager
Originator: Rob Thompson, Assistant General Manager
SUBJECT:
OPERATIONS & MAINTENANCE: WASTEWATER 101
GENERAL MANAGER'S RECOMMENDATION
RECOMMENDATION:
Information Item.
BACKGROUND
Each month, staff provides an informational presentation on topics of interest to the Board of
Directors. This month’s topic: Orange County Sanitation District Operations & Maintenance:
Wastewater 101.
RELEVANT STANDARDS
·24/7/365 treatment plan reliability
·Operate and maintain facilities to minimize impacts on surrounding communities, including
odor, noise, and lighting
·Listen to and seriously consider community input on environmental concerns
·Build brand, trust, and support with policy makers and community leaders
ATTACHMENT
The following attachment(s) may be viewed on-line at the OC San website (www.ocsan.gov) with the complete agenda
package:
·Wastewater Treatment Presentation
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OC6SAN
ORANGE COUNTY SANITATION DISTRICT
3/2/2021
1
Orange County Sanitation District
Wastewater Treatment
Presented By:
Rob Thompson,
Assistant General
Manager
Administration
Committee
March 10, 2021
Water Reclamation Process
Page 2
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2
_ lnfl_uents _ water Preliminary waler Primary R•=rc~=lnal ~ Treatment ~ Treatment
waler
l Dewalered Biosolids
Secondary
Treatment
Groundwater
Replenishment System
(GWRS) or Ocean
Compost & Land
Application
3/2/2021
2
Metering and Diverson Structure
Page 3
Preliminary Treatment
Barscreen Grit Chamber
Grit is mostly inorganic material like sand,
gravel, and egg shells.
Grit is very abrasive and heavy. It clogs flow
channels and digesters and wears out pumps.
Page 4
3
4
raw sewage
grit chamber _] L --.. ·.• sewage with
grit removed -~-· ·. ,•. , .
grit removed l.!:::===a--periodically
from collection
trap
3/2/2021
3
Primary Treatment
Page 5
Secondary Treatment
Trickling Filter
at Plant No. 1
Activated Sludge Process
Page 6
5
6
Anaerobic Aerobic
Influent
Return activated sludge
Waste
activated
slud~e
3/2/2021
4
Effectiveness of Water Treatment
Raw Sewage Primary Treated
Effluent
Secondary
Treated Effluent
Page 7
Solids Recovery Process
Anaerobic Digester
Page 8
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8
3/2/2021
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Dewatering Operation
Centrifuge System
at Plant No. 1
Page 9
Truckloading
Page 10
9
10
feed
liquid • solids ,J
3/2/2021
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Central Generation Engines
Plant No. 2 Central Generation Engines
Page 11
FY 2019/20 Operating Costs
Preliminary/Primary
Treatment , 21%
Secondary
Treatment, 13%
Dewatering,
Digestion, 22%
Biosolids Disposal,
22%
Odor Control, 11%
Effluent Disposal,
3%
Collections System,
6%
Page 12
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3/2/2021
7
Questions
?
Page 13
13
ORANGE COUNTY SANITATION DISTRICT
COMMON ACRONYMS
ACWA Association of California
Water Agencies LOS Level Of Service RFP Request For Proposal
APWA American Public Works
Association MGD Million Gallons Per Day RWQCB Regional Water Quality
Control Board
AQMD Air Quality Management
District MOU Memorandum of
Understanding SARFPA Santa Ana River Flood
Protection Agency
ASCE American Society of Civil Engineers NACWA National Association of Clean Water Agencies SARI Santa Ana River Interceptor
BOD Biochemical Oxygen Demand NEPA National Environmental Policy
Act SARWQCB Santa Ana Regional Water
Quality Control Board
CARB California Air Resources
Board NGOs Non-Governmental
Organizations SAWPA Santa Ana Watershed
Project Authority
CASA California Association of
Sanitation Agencies NPDES National Pollutant Discharge
Elimination System SCADA Supervisory Control And
Data Acquisition
CCTV Closed Circuit Television NWRI National Water Research
Institute SCAP
Southern California
Alliance of Publicly Owned Treatment Works
CEQA California Environmental
Quality Act O & M Operations & Maintenance SCAQMD South Coast Air Quality
Management District
CIP Capital Improvement
Program OCCOG Orange County Council of
Governments SOCWA South Orange County
Wastewater Authority
CRWQCB California Regional Water
Quality Control Board OCHCA Orange County Health Care
Agency SRF Clean Water State
Revolving Fund
CWA Clean Water Act OCSD Orange County Sanitation District SSMP Sewer System Management Plan
CWEA California Water Environment Association OCWD Orange County Water District SSO Sanitary Sewer Overflow
EIR Environmental Impact Report OOBS Ocean Outfall Booster Station SWRCB State Water Resources
Control Board
EMT Executive Management Team OSHA Occupational Safety and
Health Administration TDS Total Dissolved Solids
EPA US Environmental Protection Agency PCSA
Professional
Consultant/Construction
Services Agreement
TMDL Total Maximum Daily Load
FOG Fats, Oils, and Grease PDSA Professional Design Services
Agreement TSS Total Suspended Solids
gpd gallons per day PFAS
Per- and Polyfluoroalkyl
Substances WDR Waste Discharge
Requirements
GWRS Groundwater Replenishment
System PFOA Perfluorooctanoic Acid WEF Water Environment
Federation
ICS Incident Command System PFOS Perfluorooctanesulfonic Acid WERF Water Environment & Reuse Foundation
IERP Integrated Emergency
Response Plan POTW Publicly Owned Treatment
Works WIFIA Water Infrastructure
Finance and Innovation Act
JPA Joint Powers Authority ppm parts per million WIIN Water Infrastructure Improvements for the
Nation Act
LAFCO Local Agency Formation
Commission PSA Professional Services
Agreement WRDA Water Resources
Development Act
ORANGE COUNTY SANITATION DISTRICT
GLOSSARY OF TERMS
ACTIVATED SLUDGE PROCESS – A secondary biological wastewater treatment process where bacteria reproduce at a high rate with the introduction of excess air or oxygen and consume dissolved nutrients in the wastewater.
BENTHOS – The community of organisms, such as sea stars, worms, and shrimp, which live on, in, or near the seabed, also known as the benthic zone.
BIOCHEMICAL OXYGEN DEMAND (BOD) – The amount of oxygen used when organic matter undergoes decomposition by microorganisms. Testing for BOD is done to assess the amount of organic matter in water.
BIOGAS – A gas that is produced by the action of anaerobic bacteria on organic waste matter in a digester tank that can be used
as a fuel.
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 farmland 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 people detect the odor becomes the D/T for that air sample.
GREENHOUSE GASES (GHG) – In the order of relative abundance water vapor, carbon dioxide, methane, nitrous oxide, and ozone gases that are considered the cause of global warming (“greenhouse effect”).
GROUNDWATER REPLENISHMENT SYSTEM (GWRS) – 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 OCSD provides 70
million gallons per day of drinking quality water to replenish the local groundwater supply.
LEVEL OF SERVICE (LOS) – Goals to support environmental and public expectations for performance.
N-NITROSODIMETHYLAMINE (NDMA) – A N-nitrosamine suspected cancer-causing agent. It has been found in the GWRS
process and is eliminated using hydrogen peroxide with extra ultra-violet treatment.
NATIONAL BIOSOLIDS PARTNERSHIP (NBP) – An alliance of the NACWA and WEF, with advisory support from the EPA. NBP is committed to developing and advancing environmentally sound and sustainable biosolids management practices that go beyond regulatory compliance and promote public participation to enhance the credibility of local agency biosolids programs and improved communications that lead to public acceptance.
PER- AND POLYFLUOROALKYL SUBSTANCES (PFAS) – A large group (over 6,000) of human-made compounds that are resistant to heat, water, and oil and used for a variety of applications including firefighting foam, stain and water-resistant clothing, cosmetics, and food packaging. Two PFAS compounds, perfluorooctanesulfonic acid (PFOS) and perfluorooctanoic acid (PFOA) have been the focus of increasing regulatory scrutiny in drinking water and may result in adverse health effects including developmental effects to fetuses during pregnancy, cancer, liver damage, immunosuppression, thyroid effects, and other effects.
PERFLUOROOCTANOIC ACID (PFOA) – An ingredient for several industrial applications including carpeting, upholstery, apparel, floor wax, textiles, sealants, food packaging, and cookware (Teflon).
PERFLUOROOCTANESULFONIC ACID (PFOS) – A key ingredient in Scotchgard, a fabric protector made by 3M, and used in numerous stain repellents.
PLUME – A visible or measurable concentration of discharge from a stationary source or fixed facility.
PUBLICLY OWNED TREATMENT WORKS (POTW) – A municipal wastewater treatment plant.
SANTA ANA RIVER INTERCEPTOR (SARI) LINE – A regional brine line designed to convey 30 million gallons per day 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.
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.
ORANGE COUNTY SANITATION DISTRICT
GLOSSARY OF TERMS
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.