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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 powered by Legistar™ 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” Orange County Sanitation District Printed on 3/3/2021Page 1 of 3 powered by Legistar™ 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 Orange County Sanitation District Printed on 3/3/2021Page 2 of 3 powered by Legistar™ 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 powered by Legistar™ Orange County Sanitation District 1 of 10 Specification No. CS-2020-1199BD Version 080919 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. Orange County Sanitation District 2 of 10 Specification No. CS-2020-1199BD Version 080919 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 Orange County Sanitation District 3 of 10 Specification No. CS-2020-1199BD Version 080919 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. Orange County Sanitation District 4 of 10 Specification No. CS-2020-1199BD Version 080919 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. Orange County Sanitation District 5 of 10 Specification No. CS-2020-1199BD Version 080919 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. Orange County Sanitation District 6 of 10 Specification No. CS-2020-1199BD Version 080919 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. Orange County Sanitation District 7 of 10 Specification No. CS-2020-1199BD Version 080919 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 Orange County Sanitation District 8 of 10 Specification No. CS-2020-1199BD Version 080919 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 Orange County Sanitation District 9 of 10 Specification No. CS-2020-1199BD Version 080919 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. Orange County Sanitation District 10 of 10 Specification No. CS-2020-1199BD Version 080919 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 powered by Legistar™ 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 powered by Legistar™ 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 Orange County Sanitation District Printed on 3/3/2021Page 1 of 7 powered by Legistar™ 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 Orange County Sanitation District Printed on 3/3/2021Page 2 of 7 powered by Legistar™ File #:2021-1469 Agenda Date:3/10/2021 Agenda Item No:4. 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. Orange County Sanitation District Printed on 3/3/2021Page 3 of 7 powered by Legistar™ File #:2021-1469 Agenda Date:3/10/2021 Agenda Item No:4. 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 powered by Legistar™ File #:2021-1469 Agenda Date:3/10/2021 Agenda Item No:4. 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 Orange County Sanitation District Printed on 3/3/2021Page 5 of 7 powered by Legistar™ File #:2021-1469 Agenda Date:3/10/2021 Agenda Item No:4. 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 Orange County Sanitation District Printed on 3/3/2021Page 6 of 7 powered by Legistar™ 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 Orange County Sanitation District Printed on 3/3/2021Page 7 of 7 powered by Legistar™ 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. Orange County Sanitation District Printed on 3/2/2021Page 1 of 3 powered by Legistar™ 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. Orange County Sanitation District Printed on 3/2/2021Page 2 of 3 powered by Legistar™ 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 Orange County Sanitation District Printed on 3/2/2021Page 3 of 3 powered by Legistar™ 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 Page 2 1 2 3/2/2021 2 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 Page 4 3 4 3/2/2021 3 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 5 6 3/2/2021 4 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 7 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 powered by Legistar™ 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 1 2 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 3 4 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 5 6 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 7 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 9 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 Orange County Sanitation District Printed on 3/2/2021Page 1 of 1 powered by Legistar™ 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 1 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 7 8 3/2/2021 5 Dewatering Operation Centrifuge System  at Plant No. 1 Page 9 Truckloading Page 10 9 10 feed liquid • solids ,J 3/2/2021 6 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 11 12 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.