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Home My WebLink About1995-03-15II Fl1.-~:J -.... I' .,,.r.t.·· '··1 ~ U;::cc of .no Sec."'""'"', , _ .. / Sanitatlon Distr!c1(s) I i ["·-'.c.,,·. "..l 5 ~t,.? t/I .. County Sanitation Districts of Orange County, California P.O. Box 8127 • 10844 Ellis Avenue Fountain Valley, CA 92728-8127 Telephone: (714) 962-2411 . ' . ) . ,,_' . APR 2 61995 __ {_£__~MINUTES OF FINANCE AND PERSONNEL COMMITTEE Wednesday. March 15. 1995, 5:30 P.M. A meeting of the Finance and Personnel Committee of the County Sanitation Districts Nos. 1, 2, 3, 5, 6, 7, 11, 13 and 14 of Orange County, California was held on March 15, 1995 at 5:30 p.m., at the Districts' Administrative offices. (1) ROLL CALL The roll was called and a quorum declared present, as follows: Committee Directors Present: George Brown, Chairman Burnie Dunlap John M. Gullixson Wally Linn Thomas Saltarelli Roger R. Stanton, Vice Chairman William G. Steiner Peer Swan Committee Directors Absent: John C. Cox, Jr., Joint Chairman Jan Debay James H. Flora Staff Present: Don Mcintyre, General Manager Gary Streed, Director of Finance Gary Hasenstab, Director of Personnel Ed Hodges, Director of Maintenance Bob Ooten, Director of Operations John Linder, Director of Engineering Ed Torres, Director of Technical Services Steve Kozak, Financial Manager Mike White, Controller Others Present Tom Woodruff, General Counsel Patti Gorczyca, Public Financial Management Kay Chandler, Chandler Liquid Asset Management Steve Coma, Merrill Lynch Elke Chenevey, Merrill Lynch (2) APPOINTMENT OF A CHAIRMAN PRO TEM No appointment was necessary. (3) PUBLIC COMMENTS No comments were made. Minutes of Finance & P"~onnel Committee Page 2 ; March 15, 1995 (4) REPORTS OF THE COMMITTEE CHAIR. GENERAL MANAGER. DIRECTOR OF FINANCEfTREASURER. DIRECTOR OF PERSONNEL AND GENERAL COUNSEL (a) Report of the Committee Chair Committee Chairman, George Brown, discussed his concern over the Committee's purpose and asked the Directors to review the "Directors' Handbook for Committees." He also directed staff to put a discussion of the Handbook on a future agenda. (b) Report of the General Manager Don Mcintyre, General Manager, reported that the new Committee and Board meeting schedule caused two Executive Committee meetings before the April Board meeting and, therefore, the March 22nd meeting has been canceled. The Committee then discussed the new meeting schedule and the flow of information. The General Manager also requested that discussion of the CORF budget, item FPC95-19, be deferred. The Committee agreed to remove the item from the agenda. (c) Report of the Finance Director/Treasurer Finance Directorrrreasurer Gary G. Streed, reported that the County has issued a brief Investment Pool Portfolio Summary as of February 28, through Soloman Brothers Asset Management, Inc. For the month of February, reports have been issued for the Pre-Petition Pool and for the Post-Petition Pool. All funds continue to be invested in Treasury and Government Agency securities as follows: County Pre-Petition Post-Petition Total Funds $5.0 Billion $393 Million Average Maturity 7.3 days 7.8 Days Longest Maturity 20 days 17 Days Average Yield 5.94% 5.27% A summary of the Districts' total cash position at month end, including our share of the above, follows. The pre-petition balance reported has not been reduced for any losses. Minutes of Finance & P~'<,lnnel Committee Page 3 J March 15, 1995 Balances Estimated CS DOC February 28, 1995 Yield Deposits with County: Pre-Petition, Includes D.S.R. $395.7 Million 5.94% Post Petition 7.0 Million 527% Bank of America Money Market 1.1 Million 4.05% State of Calif. LAIF 11 .1 Million 5.78% Debt Service Res. w/Trustees 19.9 Million 7.23% $434.8 Million 5.98% It was moved, seconded and duly carried to receive and file this report. (d) Report of the Director of Personnel Gary Hasenstab, Director of Personnel, distributed and discussed a chart entitled usalary Distribution by Quartiles." This chart is reviewed annually as a part of the monitoring process for Management, Professional and Supervisory staff. The actual salary distributions are within the Boards' guidelines for the third and fourth quartiles. The General Manager reported that he believed the Management Performance Review Program was too cumbersome and that he would be recommending some changes for consideration by the Committee. (5) APPROVAL OF MINUTES It was moved, seconded and duly carried to approve the amended draft minutes of the February 15, 1995, meeting of the Finance and Personnel Committee. (6) OLD BUSINESS FPC95-14 Consideration of Continued Monitoring of Variable Rate Certificates of Participation (COP) and Consideration of Merrill Lynch Action Plan Financial Manager Steve Kozak presented updated variable rate COP monitoring information and a February 28, 1995 letter from Merrill Lynch. Mr. Kozak advised that the graphs included in the agenda package had been updated from the PFM report presented last month and included the comparative rate performance of several COPs through March 8, 1995. A revised PFM report through March 15, 1995 was distributed. Although Merrill Lynch averaged 21 basis points above the agents shown since December 1, 1994, they had reduced that to approximately 8.5 basis points for the period since the last Committee meeting. One basis point equals $10,000 per year on $100,000,000. Minutes of Finance & ~nnel Committee Page 4 1 March 15, 1995 Mr. Kozak reported the letter from Merrill Lynch discusses their long-term remarketing of three Districts' daily rate COPs; reports Merrill Lynch's rate performance for the Districts' COPs since the December 6, 1994, Orange County bankruptcy; and recommends a four-point action plan to improve the trading performance of the Districts' COPs going forward. The Committee discussed at length the Districts' continuing relationship with Merrill Lynch. The advisability of continued use in light of perceived public opinion, potential litigation and improved performance was also discussed. Recommendation It was moved, seconded and duly carried to: authorize staff to take actions to implement the February 28, 1995 Merrill Lynch recommended action plan as appropriate; continue active monitoring and provide status reports to the Committee; issue request for proposals to other potential remarketing agents; and research an agreement between Merrill Lynch and the Districts regarding the effect of continued employment on potential litigation. (7) NEW BUSINESS FPC95-16 Review of Draft Investment Policy Statement Prepared by Investment Advisor Chandler Liquid Asset Management. Inc. Steve Kozak, Financial Manager, and Kay Chandler, the Districts' Investment Advisor, discussed the components of a well prepared Investment Policy Statement. At the January 1995 Finance & Personnel Committee meeting, the Committee approved an interim investment policy pending development and approval of a permanent investment policy. At the February 1995 Joint Boards meeting, the Boards selected Chandler Liquid Asset Management, Inc., and Callan Associates, Inc., to prepare a permanent investment policy and conduct an external money manager search for the Districts. A sample of an Investment Policy Statement, prepared by Chandler, was reviewed for the Committee. The Districts' investment policy will be prepared to meet the requirements of the Investment Policy Certification of Excellence Program sponsored by the Municipal Treasurers Association of the U.S. and Canada. This program is designed to recognize outstanding examples of written Minutes of Finance & P"~nnel Committee Page 5 ! March 15, 1995 investment policies in the public sector throughout the U.S. and Canada. Award of a Certificate of Excellence to the Districts would be a clear example of the Boards' policy commitment to an effective investment program. Mr. Kozak advised that the details of the Investment Policy Statement will also be presented at the Directors' Workshop on Financing and Investments, which is scheduled for Saturday, March 18, 1995, from 9:00 a.m. to noon. The Districts' Investment Advisors will prepare recommendations for final investment policies for Committee consideration at the April meeting. Once the Districts' Investment Policy Statement is adopted by the Boards, Callan and Associates will conduct the external money manager search. Recommendation It was moved, seconded and duly carried to receive and file this report. FPC95-17 Consideration of a motion to renew Excess Workers' Compensation Insurance for the period May 1. 1995 to May 1. 1996. with the California Municipal Excess Workers' Compensation (CAMEX) Program Steve Kozak, Financial Manager, presented a report regarding the renewal of Excess Workers' Compensation and Employer's Liability Insurance for the period May 1, 1995 to May 1, 1996. The Districts have maintained a self-insurance fund for primary workers' compensation coverage since 1979. An appropriation of $225,000, in lieu of premium payments, was made to the Workers' Compensation Self-Insurance Fund for primary workers' compensation coverage for FY 1994-95. Excess Workers' Compensation and Employer's Liability coverage provides the Districts, as a self-insurer, with an additional layer of Workers' Compensation insurance protection above a $250,000 retention, and Employer's Liability at $1 million each accident. The FY 1994-95 premium cost for Excess Workers' Compensation and Employer's Liability coverage through CAMEX was $29,400. During the Excess Worker's Compensation Insurance renewal process in 1994, the Boards authorized the Districts to participate in the California Municipal Excess Workers' Compensation (CAMEX) Program. This joint powers agency was formed in 1994 to provide local agencies access to lower cost excess workers' compensation coverage. Staff and Robert F. Driver Company, the Districts' Broker of Record, reviewed Excess Workers' Compensation insurance alternatives, and determined that the Districts should continue to participate in the CAMEX program. Sufficient funds will be included in the FY 1995-96 Districts' Workers' Compensation Self- Minutes of Finance & fV-<?nnel Committee Page 6 J March 15, 1995 Insurance Fund budget to cover the premium costs which are estimated to be in the range of $24,000 to $29,500. Recommendation It was moved, seconded and duly carried to renew Excess Workers' Compensation and Employer's Liability Insurance for the period May 1, 1995 to May 1, 1996, with the California Municipal Excess Workers' Compensation (CAMEX) Program in an amount not to exceed $29,500. FPC95-18: Consideration of quarterly staff summarv report of training and travel costs for the quarter ended December 31. 1994 Gary G. Streed, Director of Finance, presented a summary report of training and travel costs for the quarter ended December 31, 1994. He advised that beginning in 1993-94, the Joint Boards asked the Fiscal Policy Committee to review a staff report summarizing training and travel expenses each quarter. Accordingly, the report for the quarter ended December 31, 1994, was prepared. Training, travel and meeting expenses chargeable to the Joint Operating fund are running at 41 % of the 1994-95 budget. Travel to inspect equipment fabrication for a capital project and the initial training required for a new facility may be appropriately capitalized and charged to that project. Such costs are paid through the respective capital fund, generally the Capital Outlay Revolving Fund (CORF). Mr. Streed advised that in order to fully report to the Committee, these charges have been captured and are included in the report. For this reason, the costs in this report will not be the same as those in the quarterly JO budget review. Recommendation It was moved, seconded and duly carried to receive and file this report. Since monitoring training and travel has been delegated to the Finance and Personnel Committee, no Executive Committee action is required. The Committee asked that future reports reflect the Districts' goals. The Committee directed staff and General Counsel to prepare a revision to the Training and Travel Policy restricting travel for retiring Directors and staff. FPC95-19 Consideration of 1995-96 Budget Recommended Changes from Approved Critical Projects List This item will possibly be considered at a future meeting in accordance with a request from the General Manager. Minutes of Finance & P~nnel Committee Page 7 1 March 15, 1995 FPC95-20 Consideration of cash awards and certificates of commendation for Personal Responsibility in Daily Effort (PRIDE> suggestions After reviewing 15 cost-saving and safety PRIDE suggestions, cash awards totaling $5,584.00 and certificates of commendation were recommended by staff in accordance with the Board-approved PRIDE program. It was noted that a cost savings of $147,900.00 is expected. The cost saving and safety suggestions which were considered were received from Operations and Maintenance Department employees. Recommendation It was moved, seconded and duly carried to approve cash awards totaling $5,584 .. 00 and certificates of commendation for PRIDE suggestions. The PRIDE program has been assigned to the Finance and Personnel Committee and no recommendation to the Executive Committee is required. (8) CLOSED SESSION None. (9) OTHER BUSINESS. IF ANY After a brief discussion, the Committee unanimously approved a motion to add consideration of a loan to the Garden Grove Sanitary District to the agenda under Other Business. Consideration of a Loan to the Garden Grove Sanitary District One of our member agencies, the Garden Grove Sanitary District, has a $5.4 million debt service payment due May 1, 1995. Director Swan proposed to the Committee that the Districts loan the Sanitary District the funds for a short term to prevent a default which could harm all the borrowing entities in the County, including us. The short-term loan would be secured by first rights to any proceeds from the Orange County Investment Pool and a loan to the Sanitary District from Bank of America. A 77% withdrawal from the OCIP would provide approximately $4.2 million for the Sanitary District to repay a short-term loan. Recommendation It was moved, seconded and duly carried to direct staff to continue to evaluate the legality and feasibility of a short-term loan to Garden Grove Sanitary District, and to return to the April 12 Committee meeting with a report. Timely final approval of a loan will require a special Board meeting. Minutes of Finance & pr-~rnel Committee Page 8 , March 15, 1995 (10) MATTERS WHICH A DIRECTOR WOULD LIKE STAFF TO REPORT ON AT A SUBSEQUENT MEETING None. (11) MATTERS WHICH A DIRECTOR MAY WISH TO PLACE ON A FUTURE AGENDA FOR ACTION AND A STAFF REPORT a) Consideration of the purpose or mission of the Committee and a review of the "Directors' Committee Handbook." b) Consideration of revisions to the Internal Controls over Accounts Payable, Payroll and Treasury Management. c) Consideration of actions by the Districts against financial advisors and consultants regarding the Orange County Investment Pool bankruptcy. d) Consideration of Agreement with Merrill Lynch regarding continued employment and litigation. e) Consideration of revisions to Training and Travel Policy restricting Training and Travel of retiring or terminating staff and Directors. (12) CONSIDERATION OF UPCOMING MEETING DATES AND ITEMS TO BE DISCUSSED AT THOSE MEETINGS Committee Chairman George Brown requested the Committee refer to the calendar of future meetings on the back of the Notice of Meeting and reminded the Directors that the next Finance and Personnel Committee Meeting is scheduled for Wednesday, April 12, 1995. He recommended the Committee also review the list of future meeting topics. (13) ADJOURNMENT The meeting was adjourned at 7:30 p.m. GGS:lc J:\WPDOC\FIN\CRANE\FPCMTG\FPC95IMINUTES'MFPC3.95 STATE OF CALIFORNIA) ) SS. COUNTY OF ORANGE ) Pursuant to California Government Code Section 54954.2, I hereby certify that the Notice and the Agenda for the Finance and Personnel Committee meeting held on March 15, 1995, was duly posted for public inspection in the main lobby of the Districts' offices on March 10, 1995. Posted: By: IN WITNESS WHEREOF, I have hereunto set my hand this 15th day of March, 1995. Penny Kyle, Sec t ry · e ch of the Boards of Directors of County Sanitatio istrib Nos. 1, 2, 3, 5, 6, 7, 11, 13 & 14 of Orange County, California J:\WPOOC\FIN\CRANE\FPC.MTGIFPC95\CERTOF.POS\CERTPOS3.95 March 10, 1995 ~ /~) LOUNTY SANIT A TIUN DISTRICTS OF ORANGE COUNTY, CALIFORNIA P.O. BOX 8127, FOUNTAIN VALLEY, CALIFORNIA 92728-8127 10844 ELLIS, FOUNTAIN VALLEY, CALIFORNIA 92708-7018 (714) 962-2411 NOTICE OF MEETING FINANCE AND PERSONNEL COMMITTEE COUNTY SANITATION DISTRICTS NOS. 1, 2, 3, 5, 6, 7, 11, 13 AND 14 OF ORANGE COUNTY, CALIFORNIA WEDNESDAY. MARCH 15. 1995 -5:30 P.M. DISTRICTS' ADMINISTRATIVE OFFICES 10844 ELLIS AVENUE FOUNTAIN VALLEY, CALIFORNIA 92708 A regular meeting of the Finance and Personnel Committee of the Joint Boards of Directors of County Sanitation Districts Nos. 1, 2, 3, 5, 6, 7, 11, 13 and 14 of Orange County, California, will be held at the above location, time and date. J:\WPDOC\FIN\CRANE\FPC.MTGIFPC85\NOTICE\NOTICE3.85 March 1 O, 1995 COUNTY SANITATION DISTRICTS of ORANGE COUNTY. CALIFORNIA 10844 ELLIS AVENUE PO BOX 8127 FOUNTAIN VALLEY, CALIFORNIA 92728- !7141962-2411 FINANCE AND PERSONNEL COMMITTEE March April May June July August September October November December TENTATIVELY SCHEDULED MEETING DATES Finance and Action Items to Personnel Committee Executive Committee Meetings Meeting March 15, 1995 March 22, 1995 April 12, 1995 April 19, 1995 May 10, 1995 May 17, 1995 June 14, 1995 June 21, 1995 July 12, 1995 July 19, 1995 None Scheduled None Scheduled September 13, 1995 September 20, 1995 October 11, 1995 October 18, 1995 November 8, 1995 November 15, 1995 None Scheduled None Scheduled J:\WPOOC\RNICRANEIFPC.MTGIFPC96\NOTICE\NOTICE3.96 Action Items to Joint Board Meeting April 26, 1995 April 26, 1995 May 24, 1995 June 28, 1995 July 26, 1995 August23, 1995 September 27, 1995 October 25, 1995 November 22, 1995 None Scheduled FINANCE & PERSONNEL COMMITTEE DATE 3 -15-95 COMMITTEE MEMBERS BROWN (Chair) ••••••.•••••••••••••••••••••••• STANTON (Vice Chair) ••.••••••••.••••••....•.• DEBAY •••••••••••••••••••••••••••••••••••••.• DUNLAP .••.•.•••••••••••••••••••••••••••••.• FLORA ............................. -........ . GULLIXSON •••.•••••••••••.••.•..•••••••••••• LINN ••••• , ••.•••••••••.••••••••••••••••••••.• SALTARELLI •••.••••••••••••••.•.•••••.••••••• STEINER ••••.••••••••..•••••••••••••••••••••• SWAN (VJC) ••••••••••••.••••...••••••••••.••• COX (JC) •••••••••••••••..•••••.•••••••••••... OTHER DIRECTORS ---------· ....... " ... " ........ . --------······················ STAFF DON MCINTYRE, GENERAL MANAGER •.•..••..•...•••..•..•.. BLAKE ANDERSON, ASST. GENERAL MANAGER •.••••••••••••• GARY STREED, DIRECTOR OF FINANCE .•..•.•••...•••••••••• GARY HASENSTAB, DIRECTOR OF PERSONNEL •...••..•..•.•. ED HODGES, DIRECTOR OF MAINTENANCE ..••.•••.•..•..••.. BOB OOTEN, DIRECTOR OF OPERATIONS .•.••••...•••••••••• JOHN UNDER, DIRECTOR OF ENGINEERING .••••.•••••••••••• ED TORRES, DIRECTOR OF TECH. SERVICES ••••••••••••••••• STEVE KOZAK, FINANCIAL MANAGER .••••••••••••..••••••••• MIKE WHITE, CONTROLLER ••.••.•••..•.•.•.•..••••.•.•.•••• OTHERS TOM WOODRUFF, GEN'L. COUNSEL ........•.•.••••.••••••••• PATTI GORCZYCA, PFM ••..••.•........•..•......•.•....••.• KAY CHANDLER, CHANDLER LIQUID ASSET MGMT ............ . ROLL1.95 TIME 5:30 P.M. ADJOURN. ___ _ , March 15, 1995 AGENDA "FINA NCE AND PERSONNEL COMMITTEE COUNTY SANITATION DISTRICTS NOS. 1, 2, 3, 5, 6, 7, 11, 13 AND 14 OF ORANGE COUNTY, CALIFORNIA DISTRICTS' ADMINISTRATIVE OFFICES 10844 ELLIS AVENUE FOUNTAIN VALLEY, CALIFORNIA 92708 REGULAR MEETING WEDNESDAY. MARCH 15, 1995 -5~30 P.M. :····L ........................... ,., ...................................... _., .... ., ... , ...................................................................................................................................................................... 1 : : ·:.':::::::. In accordance with the requirements of California Government Code Section 54954.2, this ,·::.::::::: agenda has been posted in the main lobby of the Districts' Administrative Offices not less than 72 hours prior to the meeting date and time above. All written materials relating to each agenda item are available for public inspection in the Office of the Board Secretary. l:. In the event any matter not listed on this agenda is proposed to be submitted to the ;::. Committee for discussion and/or action, it will be done in compliance with Section 54954.2(b) as an 1: emergency item or that there is a need to take immediate action which need came to the attention of ·.1. the Committee subsequent to the posting of the agenda, or as set forth on a supplemental agenda l posted in the manner as above, not less than 72 hours prior to the meeting date. l • " ........ •'ti ................ "'" ............. " " •.• " ~ ••• " ......... • .... -. • • L• ...... • • • ""' • U I • • • " "• " °'""' .... ••• """" " r " " " " " " " " • " " "" " " " "·" " '"" "'" ......... "" '° °':"'" O '°" " " ":"'° "'" • ••" " " " " " " "" " "" " "" " " "" " • " " " " " ~-" " " " "" "" " """ O "" " " " " " "" " " .. ~ ( 1 ) Roll Call (2) Appointment of Chairman pro tern, if necessary. (3) Public Comments: All persons wishing to address the Committee on specific agenda items or matters of general interest should do so at this time. As determined by the Chairman, speakers may be deferred until the specific item is taken for discussion and remarks may be limited to five minutes. Matters of interest addressed by a member of the public and not listed on this agenda cannot have action taken by the Committee except as authorized by Section 54954.2(b ). March 15, 1995 (4) The Committee Chairman, General Manager, Director of FinancefTreasurer, Director of Personnel and General Counsel may present verbal and/or written reports on miscellaneous matters of general interest to the Committee Members. These reports are for information only and require no action by the Committee Members. (a) Report of Committee Chairman (b) Report of General Manager (c) Report of Director of FinancefTreasurer ( d) Report of Director of Personnel ( e) Report of General Counsel (5) Approval of draft Finance and Personnel Committee Minutes for Meeting of February 15, 1995. (6) Old Business. FPC95-14 Consideration of Continued Monitoring of Variable Rate Certificates of Participation (COP) and Consideration of Merrill Lynch Action Plan (7) New Business. FPC95-16 Review of Draft Investment Policy Statement Prepared by Investment Advisor Chandler liquid Asset Management, Inc. FPC95-17 Consideration of a motion to renew Excess Workers' Compensation Insurance for the period May 1, 1995 to May 1, 1996,.with the California Municipal Excess Workers' Compensation (CAMEX) Program FPC95-18 Consideration of Quarterly Staff Summary Report of Training and Travel Costs for the Quarter Ended December 31, 1994 FPC95~19 Consideration of 1995-96 Budget Recommended Changes from Approved Critical Projects List FPC95-20 Consideration of Cash Awards and Certificates of Commendation for Personal Responsibility in Daily Effort (Pride) Suggestions -2- 1 March 15, 1995 (8) Closed Session. :::~:::~~~~-- closed session to consider matters of pending or potential litigation, or personnel matters, pursuant to Government Code Sections 54956.9, 54957 or 54957 .6. :::. i====: Reports relating to (a) purchase and sale of real property; (b) matters of pending or potential litigation; (c) employee actions or negotiations with employee representatives; or which are exempt from public disclosure under the California Public Records Act, may be reviewed by the Committee during a permitted closed session and are not available for public ====.=:! inspection. At. such time as final actions are taken by the Committee on any of these subjects, the minutes will reflect all required disclosures of information. . . l.•-••••••••,.••••••••••••-•••••••••••••9'••oo:a•·•••·••L11•.aa•-••-••Lf"•-•:•&a.11"aa.a••a""t-•••·•11:•••••·•••••-=--••••••--...-.•L•••••.:.-•a••••11:11••••:••·••..,•••••L11 .. ••••••••••••••••••••-•••·•••••w,.•••••••••••••-•·••I (a) Convene in closed session, if necessary (b) Reconvene in regular session. (c) Consideration of action, if any, on matters considered in closed session. ( d) Report on discussion taken in closed session, as required. (9) Other business, if any. (10) Matters which a Director would like staff to report on at a subsequent meeting. (11) Matters which a Director may wish to place on a future agenda for action and a staff report. (12) Consideration of upcoming meeting dates and items to be discussed at those meetings. (13) Adjourn. ~-·-······ ., ............................ '"' .............................................................. ~ ......................................................................................................................................................................................... ·· 1 : : : : : Notice to Committee Members: : : : ~ : ! If you have any questions regarding the Agenda, or wish to place items on the Finance and 1 t, Personnel Committee Agenda, Committee members should contact the Committee Chair or !. Secretary ten days in advance of the Committee meeting. : : : : 1 Committee Chair: George Brown (310) 431-2185 i 1 Secretary: Lenora Crane (714) 962-2411, Ext. 2500 ~ j (714) 962-3954 (FAX) l : : : : 1 •••• .-................... ,.. ............................................................................................... ,.. .......................................................... ,. .................................... ! -3- FINANCE AND PERSONNEL COMMITTEE AGENDA FOR MARCH 15, 1995 ( 4): Treasurer's Report Summary: The County has issued a brief Investment Pool Portfolio Summary as of January 31, 1995, through Soloman Brothers Asset Management, Inc. For the month of February, reports have been issued for the Pre-Petition Pool and for the Post-Petition Pool. The Summaries and cover letter are enclosed for the Committee's review. All funds continue to be invested in Treasury and Government Agency securities as follows: County Pre-Petition Post-Petition Total Funds $5.0 Billion $393 Million Average Maturity 7.3 days 7.8 Days Longest Maturity 20 days 17 Days Average Yield 5.94% 5.27% A summary of the Districts' total cash position at month end, including our share of the above, follows. The pre-petition balance reported has not been reduced for any losses. Balances Estimated CS DOC February 28, 1995 Yield Deposits with County: Pre-Petition, Includes D.S.R. $395.7 Million 5.94% Post Petition 7.0 Million 5.27% Bank of America Money Market 1.1 Million 4.05% State of Calif. LAIF 11.1 Million 5.78% Debt Service Res. wfTrustees 19.9 Million 7.23% $434.8 Million 5.98% J:\WPOOC\FINICRANEIFPC.MTGIFPC85VTEMS.AGOIFPC3-95.• ,.._1 l TOTAL CASH & INVESTMENTS Dec6 Staff Recommendation Information only item. J:IWPOOC\FIN\CRANE\FPC.MT'GIFPC95\ITEMS.AG~.4 Dec31 Jan 31 Feb28 -2- Salomon Brothers Asset Management Inc Seven World Trade Center New York, New York 10048 212-783-7000 March 3, 1995 Dear Pool Participants: Salomon Brothers February started with a 50 bp increase in the Fed Funds rate at the conclusion of the January 31 -February 1 FOMC meeting. From that point forward short-term money market rates traded in a very narrow band, with 3-month T-bills moving from a high of 5.89D/o to a low of 5.68%. The market got a boost in confidence when Alan Greenspan, in his Humphrey-Hawkins testimony to Congress, presented a balanced view on the market and even mentioned the possibility of easing monetary policy for the first time in over a year. We are enclosing portfolio summaries as ofFebruary 28, 1995 for both the pre- petition and post-petition portfolios. The OCIP was split into two separate accounts on February 15. We continue to manage the portfolios in a conservative manner, investing in only short-maturity Treasury and government agency securities. Sincerely, _Jr__)};y,-r--1 - Steven Guterman ~!~ Nancy Noyes County Of Orange Post Petition Portfolio Investment Pool Portfolio Summary February 28, 1995 • All investments are in Treasury or Agency securities • Maturities range from March 1, 1995 through March 17, 1995 • 7 .8 day average maturity • 5.27% average investment's annualized daily yield • $393 million in portfolio investments Maturity Schedule (in million dollars) Date 3/1 3/2 3/3 3/6 3/7 3/8 3/9 3/10 3/13 3/14 3/15 3/17 B of A comp. balances Issuer Breakdown (in million dollars) Issuer FNMA FHLB B of A comp. balances FHLMC FFCB Treasury collarteralized O/N Amount $ SI 23 24 10 34 28 23 12 25 29 72 17 45 Amount $153 105 45 43 27 20 County Of Orange Pre Petition Portfolio Investment Pool Portfolio Summary February 28, 1995 • All investments are in Treasury or Agency securities • Maturities range from March 1, 1995 through March 20, 1995 • 7 .3 day average maturity • 5.94% average investment's annualized daily yield • $5.0 billion in portfolio investments Maturity Schedule (in million dollars) Date 3/1 3/2 3/3 3/6 317 3/8 3/9 3/10 3/13 3/14 3/15 3/17 3/20 B of A comp. balances Issuer Breakdown (in million dollars) Issuer FNMA FHLB FHLMC Treasury collarteralized O/N FFCB B of A comp. balances Amount $ 812 539 465 337 433 523 337 337 489 389 327 31 50 5 Amount $1,936 1,474 1,129 285 245 5 FINANCE AND PERSONNEL COMMITTEE AGENDA FOR MARCH 15, 1995 ( 5): Consideration of Motion to Approve, Receive and File the Finance and Personnel Committee Minutes of February 15, 1995 Summary Attached is a draft of the Finance and Personnel Committee Minutes of February 15, 1995, for approval by the Committee. Staff Recommendation The February 15, 1995, draft minutes have been presented to the Executive Committee at their February 22, 1995, meeting and to the Joint Boards at their March 8, 1995, meeting. It is recommended that the minutes be approved, received and filed. J:IWPDOC\FlNICRANE\FPC.MTGIFPC95VTEMS.AGC71MFPC3.95 County Sanitation Districts of Orange County, California P.O. Box 8127 • 10844 Ellis Avenue Fountain Valley, CA 92728-8127 Telephone: (714) 962-2411 MINUTES OF FINANCE AND PERSONNEL COMMITTEE Wednesday. February 15. 1995. 5:30 P.M. A meeting of the Finance and Personnel Committee of the County Sanitation Districts Nos. 1, 2, 3, 5, 6, 7, 11, 13 and 14 of Orange County, California was held on February 15, at 5:30 p.m., at the Districts' Administrative offices. (1) ROLL CALL The roll was called and a quorum declared present, as follows: Committee Directors Present: George Brown, Chairman John C. Cox, Jr., Joint Chairman Jan Debay Burnie Dunlap James H. Flora John M. Gullixson Wally Linn Thomas Saltarelli Roger R. Stanton, Vice Chairman Peer Swan, Vice Joint Chairman Committee Directors Absent: William G. Steiner Staff Present: Blake Anderson, General Manager Gary G. Streed, Director of Finance Gary E. Hasenstab, Director of Personnel Ed Hodges, Asst. Director of Operations Bob Ooten, Asst. Director of Maintenance Michael D. White, Controller Steve Kozak, Financial Manager Laurie Bluestein, Acting Laboratory Manager Don Mcintyre, Incoming General Manager Others Present Patti Gorczyca, Public Financial Management Sam Cor1iss, Merrill Lynch Ed Alario, Anaheim Public Utilities (2) APPOINTMENT OF A CHAIRMAN PRO TEM No appointment was necessary. (3) PUBLIC COMMENTS Ed Alario of the City of Anaheim informed the Committee that he would answer questions regarding Item No. 7, Excess Capacity Charges. Sam Corliss of Merrill Lynch informed the Committee that he would answer questions regarding FPC95-14, Consideration of Review of Remarketing Agent. Minutes of Finance & Page2 February 15, 1995 )Onnel Committee (4) REPORTS OF THE COMMITTEE CHAIR. GENERAL MANAGER. DIRECTOR OF FINANCE/TREASURER. DIRECTOR OF PERSONNEL AND GENERAL COUNSEL (a) Report of the Committee Chair None. (b) Report of the General Manager Blake Anderson reported that he had spent most of the day at an Investment Pool Committee meeting. The mood of the Pool participants, he reported, was increasingly restless and frustrated. Mr. Anderson reviewed the County Plan as reported at the Board meeting last week; 77% cash, 3% recovery notes, 9% senior secured claim, 11 % subordinated claim. There seems to be consensus on the acceptability of an initial 80% front-end cash and note deal, but great concern over the 20% of claims which have an unacceptable degree of uncertainty because they are backed only by the litigation receipts that may be successfully obtained by the County. The Committee members discussed the County Plan, the action of the Pool Committee, the attitudes of the cities and the County, and the proper position of the Districts in the matter at great length. The Pool Committee is expecting to ask for a vote in March. At that time, the General Manager will seek Board direction. (c) Report of the Finance Director/Treasurer Finance Director!Treasurer Gary G. Streed, reported that the County has issued a brief Investment Pool Portfolio Summary as of January 31, 1995, through Soloman Brothers Asset Management, Inc. The Summary and cover letter were included in the Committee's agenda packet for their review. Mr. Streed advised that all funds continue to be invested in Treasury and Government Agency securities as follows: January 31, 1995 Total Funds $5 .5 Billion Average Maturity 7Days Longest Maturity 21 Days Average Yield 5.38% Joint Chairman Cox asked for more information in future reports about the change in the County balances. Minutes of Finance & ~vnnel Committee Page 3 February 15, 1995 ( Mr. Streed summarized the Districts' total cash position at month end, including our share of the above as follows. The pre-petition balance reported has not been reduced for any losses. Current Report January 31, 1995 Deposits with County: Pre-Petition $348.1 Million Post Petition 8.6 Million Bank of America Money Market 8.5 Million State of Calif. LAIF 7.5 Million Debt Service Res. w!Trustees 19.9 Million $392.6 Million The Committee offered suggestions for future report formats and will notify staff of other ideas they have. Mr. Streed reported that Standard & Poor's had lifted the negative rating of the Districts' retired Taxable Commercial Paper Program which would help to improve our credit on Wall Street. Moody's, however, required a formal action of the Board stating the Taxable Commercial Paper Program will not be re-initiated without future Board action and a replacement for the Standby Withdrawal Agreement with the County. With the Committee's agreement, such an item will be forwarded to the Executive Committee. A short-term line of credit proposed by Societe Generale, with an option to convert to long-term, was briefly presented. The Directors noted their desire not to reenter the short-term financial market, especially at the rates proposed. The proposal was tabled pending a pressing need. The Committee had expressed a desire for an informational session on Saturday to review the process and plans for financing and investing by the Districts. The Committee agreed to schedule Saturday, March 18, 1995, at 9:00 a.m. All Directors will be invited. (d) Report of the Director of Personnel Gary Hasenstab, Director of Personnel, distributed a staff report entitled, "Employee Turnover Analysis" prepared by his staff. The report indicated that turnover at the Districts is relatively low, averaging 6.6% over the past three years. Voluntary termination amounted to an average of 4.3%. The Committee was pleased that such analyses are performed and that the Districts are within the national range. Minutes of Finance & Page4 February 15, 1995 )onnel Committee (5) APPROVAL OF MINUTES Director Dunlap referenced FPC item 95-05, "Internal Controls for Accounts Payable, Payroll and Treasury," included in the January 18, 1995 meeting minutes, and offered the City of Brea's comments on internal controls. Staff will respond at the next meeting. It was moved, seconded and carried to approve the draft minutes of the January 18, 1995, meeting of the Finance and Personnel Committee. (6) STAFF OVERVIEW OF DISTRICTS AND FINANCE AND PERSONNEL DEPARTMENTS FOCUSING ON COMMITTEE HANDBOOKS The Committee members were given a personal copy of the Directors' Handbook for Board Committees. Chairman Brown asked the Directors to review the handbook over the next month and to direct any question to staff. The Finance Director reported that Section H was specific to the Committee and that the Policies and Procedures Manual for the COP program was included. (7) CONSIDERATION OF OPERATIONS. MAINTENANCE AND TECHNICAL SERVICES COMMITTEE RECOMMENDATION OMTS95-011 The Districts' Wastewater Discharge Regulations provide for an Excess Capacity Charge, in an amount and method to be determined by the Boards of Directors on a case-by-case basis. In August 1994, the Joint Boards of Directors approved a policy whereby governmental agencies would be assessed these charges and directed staff to report on a specific approach for assessing the charge. Staff has been informed that there are several public agency projects that will have significant capacity demands on our system and developed an approach for assessing Excess Capacity Charges. The Operations, Maintenance and Technical Services (OMTS) Committee considered item OMTS95-011-"Consideration of motions to receive and file staff report re establishing procedures for assessing Excess Capacity Charges; and to direct staff to prepare a resolution establishing the Excess Capacity Charge Program," at their meeting on February 1, 1995. The OMTS Committee duly moved, seconded and approved staffs recommendation. The Planning, Design and Construction Committee reviewed the OMTS recommendation and the staff report at their meeting of February 2, 1995. The approach developed for assessing Excess Capacity Charges was reviewed for the Finance and Personnel Committee's information. It was moved, seconded and duly carried to receive and file OMTS95-011. \ I Minutes of Finance & ~1nnel Committee Page 5 · February 15, 1995 (8) OLD BUSINESS FPC95-06 Consideration and Review of Short List for Selection of Districts' Independent Auditors and Establish a Selection Committee At the last Committee meeting, the Directors approved the release of the Request for Proposals (RFP) for Professional Auditing Services to prospective firms. The RFP was mailed on January 19, 1995, and five responses were received on February 10, 1995. The services to be provided include the audit of the Districts' financial statements for the fiscal year ending June 30, 1995, with the option to audit the Districts' financial statements for each of the three subsequent fiscal years. Prior to the February Committee meeting, the Director of Finance, the Controller and the Accounting Manager reviewed and ranked the proposals using the Evaluation Ranking Form. A short list of firms recommended by them, including Conrad & Associates, Moreland & Associates and Deloitte & Touche, was presented at the meeting. Director Dunlap presented the City of Brea's comments on the long list of firms to receive RFPs. The city staff was supportive of the long list and of the regional firms on the short list. Recommendation It was moved, seconded and carried to form a Selection Committee consisting of the Finance and Personnel Committee Chairman, the Director of Finance, and the Controller. On February 24, 1995, the Selection Committee is scheduled to interview the firms on the short list and prepare a recommendation to the Joint Boards. Vice Joint Chairman Swan asked the Selection Committee to report on the impact of the Financial Program of hiring a regional firm versus a "Big 6" firm. FPC95-09 Consideration of Certificates of Participation f COP) Information Sheet At the January 18, 1995, Finance and Personnel Committee meeting, Committee members reviewed the Quarterly COP Interest Rate Monitoring Report for the 1990-92 Capital Improvement Program. After receiving and discussing the report, Committee members requested staff to prepare a one-page information sheet on COPs. Minutes of Finance & Page6 February 15, 1995 iOnnel Committee Steve Kozak, Financial Manager, presented an information sheet containing a general description of COPs and synthetic interest rates, and directed the Committee to a detailed and complete presentation in the Certificates of Participation (COP) Financing Program Policy and Procedures Manual included in the Directors' Committee Notebook. FPC95-12 Consideration of a Motion Recommending a Board Resolution Adopting the Provisions of Government Code Section 31641.04 Authorizing Two Years Additional Service Credit for Retirement Pumoses Gary Hasenstab, Director of Personnel, presented a report adopting provisions of Government Code 31641.04, authorizing Districts employees to receive two years additional service credit for retirement purposes. The County Employees Retirement Law of 1937 allows the Districts' Boards to determine that it would be in the best economic interests of the Districts for employees who are otherwise eligible to retire to receive an additional service credit of two years as an incentive to retire within a specified period. Mr. Hasenstab further described the potential savings from an early retirement program and the steps needed for implementation. As a matter of policy, positions vacated through this process may be eliminated or left unfilled (attrition) for a specified period, thus increasing salary savings potential. Recommendation It was moved, seconded and carried to pass to the Executive Committee without comment staff reports and a Board Resolution adopting the provisions of Government Code Section 31641.04 authorizing Districts employees in the following classifications: Collection Facilities Field Supervisor, Facilities Manager and Foreman, to receive two years additional service credit for retirement purposes to be effective March 1, 1995 through April 30, 1995. FPC95-13 Status Report on Districts• Deferred Compensation Plan in Response to Director Swan's Request Finance Director Gary Streed reported that the Districts have an IRS-approved "unqualified" deferred compensation plan. All employees and Directors are eligible to participate in the plan. There are approximately 300 active participants in the plan. Deposits to an "unqualified" plan are legally the property of the Districts. Two options are provided for plan deposits: the County Commingled Investment Pool, and the Lincoln National Insurance Plans. Prior to the County's bankruptcy, 67% of the participants were making deposits to the Commingled ) Minutes of Finance & ~1nnel Committee Page 7 February 15, 1995 , ' Investment Pool. Several employees have changed plans since December 6, 1994, and now 30% of the participants are in the Commingled Investment Pool. The Old Age, Survivors and Disability (OASDI) contributions of 7.5% for each Director are also deposited in the Commingled Investment Pool. Deductions from payrolls and Directors' compensation since December 6, 1994 have been held in the Districts' safe and not deposited into the Commingled Investment Pool. No interest earnings have been allocated or apportioned to the County Plan since June 30, 1994. Assuming that the Commingled Investment Pool has realized a 23% principal loss, the 457 Plan participants' deposits could be reduced by $1 ,073,336.40. Interest earnings since July 1, 1994 previously estimated to be $127,519.05 are now undetermined, and will be addressed later. The Committee considered several options for making the depositors ''whole," including an immediate cash infusion, payments at retirement, establishing a new fund and establishing a reasonable "loss" for the year. The Committee asked that this matter be reconsidered when the status of the entire County Pool was resolved. (9) NEW BUSINESS FPC95-14 Consideration of Review of Remarketing Agents for Variable Rate Certificates of Participation Steve Kozak, Financial Manager, presented a written report that Merrill Lynch, remarketing agent for the Districts' 1990-92 Series "A," Series "C," and 1993 Refunding Certificates of Participation {COPs), resets the interest rates each day and remarkets these COPs. For the 1992 Refunding COPs, PaineWebber completes the process weekly. Mr. Kozak reported that within a few days of the County's bankruptcy filing, the Districts' daily COPs were trading as high as 255 basis points above the index. At year end, the Districts were paying 97 basis points above the index. During January, the difference has been as low as 29 basis points, but has increased to 92 basis points on February 7. One basis point is the equivalent of $10,000 per year on $100,000.00. During December and January, staff and PFM have discussed the recent market situation and remarketing performance with the remarketing agent. The remarketing agent has noted that investors are weary of any securities bearing the "Orange County" name, regardless of the credit worthiness of a particular issuer, such as the Districts. The remarketing agent has suggested that additional time wilJ be required for the market to accept "Orange County" paper and for interest rates to come down, and that an investor tour or a rating confirmation may help to speed the process. Other remarketing agents are currently producing lower interest rates on comparable borrowings. Minutes of Finance & Page 8 February 15, 1995 1onnel Committee I Patti Gorczyca, Public Financial Management, gave an overhead presentation on the performance of the Districts' daily remarketing agent. She showed that outside of Orange County the daily rates for five remarketing agents are very close. Inside Orange County, however, Merrill Lynch has set the Districts' rates higher than the rates paid by other agencies with other remarketing agents. The difference in rates has decreased over the last month. Sam Corliss of Merrill Lynch answered questions from the Committee. He reported that Merrill Lynch remarkets almost all of the daily reset issues from Orange County. Because of this volume, Merrill Lynch must sell to corporate and money market funds, thus raising the rates paid. Mr. Corliss reaffirmed his firm's desire to expand the market pool and to provide the lowest possible rates. Recommendation After considerable discussion, the Committee voted to recommend to the Executive Committee and the Boards that the Finance and Personnel Committee be delegated the authority to replace the remarketing agent if they determine it necessary after monthly comparative monitoring and reporting by staff. FPC95-15 Consideration of Joint Works Budget Reviews Prepared by Staff for the Quarter Ended December 31. 1994 Gary G. Streed, Finance Director, presented written Joint Works Budget reviews for the quarter ended December 31, 1994, and summary statements of the Joint Works Operating Costs, the Joint Works Capital Improvement Program, and the costs of the workers' compensation, public liability and health plan self-insurance funds for the six months of fiscal year 1994-95. With one-half of the year gone, Mr. Streed advised that 45.9% of the net joint operating budget has been expended. Net costs are up $505,952 or 2.28%, compared with the same period last year. This is primarily due to salaries and wages, a decrease in labor charged to CORF projects, a change in the sulfide control program, the studies of Ernst & Young, and increased monitoring costs. Small increases and decreases in other categories make up the balance. At the same time, flows have increased 15.68%. Therefore, the increase in costs and total flows have resulted in a $24.07 per million gallons net decrease in the unit cost to treat and dispose of sewage, to $517.70 per million gallons. Joint Works construction projects for the first six months are lower than originally scheduled, running at 21 % of the 1994-95 budget or $14.0 million. We continue to receive excellent bids on new projects, reflecting the slow economy. Several projects have recently been awarded and progress payments on these projects will increase CORF outlay over the remainder of the year. Minutes of Finance & r ')nnel Committee Page 9 February 15, 1995 The self-funded insurance program are operating within their budgets. Summary reports for the Joint Works and the individual Districts will be considered by the full Boards of Directors in March. (10) CLOSED SESSION None. (11) OTHER BUSINESS. IF ANY None. (12) MATTERS WHICH A DIRECTOR WOULD LIKE STAFF TO REPORT ON AT A SUBSEQUENT MEETING None. (13) MATTERS WHICH A DIRECTOR MAY WISH TO PLACE ON A FUTURE AGENDA FOR ACTION AND A STAFF REPORT None. (14) CONSIDERATION OF UPCOMING MEETING DATES AND ITEMS TO BE DISCUSSED AT THOSE MEETINGS Committee Chairman George Brown requested the Committee refer to the calendar of future meetings on the back of the Notice of Meeting and advised the next Finance and Personnel Committee Meeting is scheduled for Wednesday, March 15, 1995. He recommended the Committee review the list of future meeting topics. (15) ADJOURNMENT The meeting was adjourned at 7:50 p.m. GGS:lc J:\WPDOC\FIN\CRANE\FPC.MTG\FPC95\MINUTES'MFPC2.95 /"\ I FINANCE AND PERSONNEL COMMITTEE AGENDA FOR MARCH 15, 1995 FPC95-14: Consideration of Continued Monitoring of Variable Rate Certificates of Participation (COP) and Consideration of Merrill Lynch Action Plan Summary Steve Kozak, Financial Manager, will present updated variable rate COP monitoring information and a February 28, 1995 letter from Merrill Lynch. The attached graphs, updated from the PFM report presented last month, shows the comparative rate performance of several COPs through March 8, 1995. The graphs on \ pages 8 and 9 show the rates for daily variable rate COPs issued by agencies within Orange County, including the Districts. Although Merrill Lynch averaged 25 basis points above the agents shown since December 1, 1994, they were approximately 50 basis points below the March 8, 1995 average. One basis point equals $10,000 per year on $100,000,000. The attached letter from Merrill Lynch discusses their remarketing of three Districts' daily rate COPs. The letter discusses Merrill Lynch's rate performance for the Districts' COPs since the December 6, 1994, Orange County bankruptcy, and recommends a four-point action plan to improve the trading performance of the Districts' COPs going forward. Staff Recommendation That the Finance and Personnel Committee consider implementation of the February 28, 1995 Merrill Lynch recommended action plan, and authorize staff to take actions as appropriate, and to continue active monitoring and to provide status reports to the Committee. J:\WPDOC\Flr.'ICRANEIFPC.MTGIFPC95\ITCMS.AGDIFPC85.14A L Orange County Sanitation Districts Report to the Finance and Personnel Committee J TAX-EXEMPT HIGH GRADE DAILY REMARKETING RATES __ ) March 9, 1995 L Orange County Sanitation Districts Report Contents • Summary of District's Variable Rate Debt • Other Primary Remarketing Agents • Existing Remarketing Volume by Firm • Tax-Exempt High Grade Daily Remarketing Rates -Within California outside Orange County -Within Orange County • Tax-Exempt Remarketing Fees • Increased Interest rate costs of recent Merrill_ Lynch remarketing rates • Recommendations _) .. _.l 1 Orange County Sanitation Districts Summary of Districts Variable Rate Debt Mode Par Amount Remarketing Agent Daily Reset $244,500,000 Merrill Lynch ·Weekly Reset $160,600,000 Paine Webber 2 L ) .. ~ Orange County Sanitation Districts Primary Remarketing Agents of Daily and Weekly Rate Paper • Merrill Lynch J • Goldman Sachs • JP Morgan • PaineWebber • Lehman Brothers J • Smith Barney 3 Orange County Sanitation Districts Existing Tax-Exempt Daily Remarketing Volume by Firm (CA) Firm Volume Summary Lehman Brothers $192,000,000 Merrill Lynch $782,000,000 Goldman Sachs $242,850,000 JPMorgan $318,300,000 Paine Webber $219,690,000 *Smith Barney does not remarket any California daily paper 4 L Orange County Sanitation Districts Tax-Exempt High Grade Daily Remarketing Rate Comparables J • Within California outside Orange County » 5 Transactions • Within Orange County » 3 Transactions 5 Orange County Sanitation Districts 4.50% 4.00% 3.50% 3.00% - 2.50% 2.00% 1.50% "<:fi "<:fi 0\ 0\ ......... ......... II') 0\ ..-1 N ......... ......... \0 \0 California Outside Orange County AVERAGE RATE Lehman JPMorgan PalneWebber Go Id man Smith Barney 2 . 9 8 54 % . . . . . . . • . ------• -• ----. --. . • --• "<:fi "<:fi "<:fi 0\ 0\ 0\ ......... ......... ......... er) r:..... 0 ..-1 N ..-1 ......... ......... ......... r:..... r:..... 00 2.9598 % 2 .9 0 4 9 % --•• -.•• -•..... 2.9500 % 2.9317% "<:fi ~ 0\ 0\ ......... ......... ~ r:..... N ......... ......... 0\ 00 ~ 0\ ......... ..-1 N ......... 0\ ~ "<:fi 0\ 0\ ......... ......... II') 0\ ......... ..-1 0 ......... ..-1 0 ..-1 ~ ~ ~ ~ 0\ 0\ 0\ 0\ ......... ......... ......... ......... N \0 0 ~ ......... ..-1 er) ..-1 ..-1 ......... ......... ......... ..-1 ..-1 ..-1 N ..-1 ..-1 ..-1 ~ II') IJ') 0\ 0\ 0\ ......... ......... ......... 00 ..-1 IJ') N ..-1 N ......... ......... ......... N ..-1 ..-1 ..-1 ........._.Paine Webber ----JP Morgan -·· ---<rv"·· Goldman -~Lehman -_.....__Smith Barney - II') II') II') 0\ 0\ 0\ ......... ......... ......... 00 N 00 ......... N ......... N ......... er) N 6 L Orange County Sanitation Districts California outside Orange County Transactions • JPMorgan -California Statewide Community Development • Goldman -Santa Clara County District •· PaineWebber -California Pollution Control Financing Authority • Lehman -California Pollution Control Financing Authority • Smith Barney -Historical Composite .. 7 Orange County Sanitation Districts 7.00% 6.50% 6.00% 5.50% 5.00% 4.50% 4.00% 3.50% 3.00% 2.50% 2.00% ~ °' ........ rl ........ N rl Orange County Selected Daily Rates: 12/94 -Present AVER AGE RATE -------------------------1------------l ------------Merrill Lynch JP Morgan --------• --------· -----Paine Webb er -·-------------·-··-----1---------1 4.5778 % 4.3403% 4 .3042 % ..... ____ ,.,.,. __ _ ------------------------------t-• ---• --- \ ---------. ------. --.. -. ---\ ---"/ ---.. -----. -. . . . ------. --. -. --------. -----~-- ---------------.. --. -------'!"-------------------. ---... --------. -------- "1i ~ ~ ~ "1i l!') l!') l!') l!') l!') l!') l!') l!') l!') l!') l!') l!') 0\ °' °' °' °' 0\ °' 0\ °' 0\ °' °' °' 0\ °' 0\ 0\ ........ ........ ........ ........ ........ ......... ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ !:'-... C() °' l!') .-i \0 N 00 ~ 0 l!') rl !:'-... N \0 N \0 ........ rl rl N C() ........ rl .-i N C() ........ .-i .-i N N ........ ........ N ........ ........ ........ ........ rl ........ ........ ........ ........ N ........ ........ ........ ........ C() C() .-i N N N N .-i rl .-i rl N N N N rl rl .-i rl I -+-Paine Webber ---JP Morgan ----+.,,--Merrill Lynch -I 8 Orange County Sanitation Districts 4.70% 4.50% 4.30% - 4.10% 3.90% 3.70% 3.50% 3.30% 3.10% 2.90% 2.70% Orange County Daily Rates: 2/95 -Present A VERA GE RA TE . . _ . . _ _ _ _ _ _ _ Me rri II Ly nc h JP Morgan PaineWebber 4 .0 6 81 % 3.9542% 3.8806% ) _, \ -.. -..... -----"\ 2.50% -1---+~+---+~+--+-~+---t-~+---t-~+---~+---+----i~-+----+~-+---+~+--+-~+---+-~+---t-~+---+-~+---+----i~-+---+~+---+~+-- Lt) Lt) Lt) Lt) Lt) Lt) Lt) Lt) Lt) Lt) Lt) Lt) Lt) Lt) Lt) Lt) Lt) Lt) °' °' °' °' °' °' °' °' °' °' °' °' °' °' °' °' °' °' .......... .......... .......... .......... .......... .......... .......... .......... .......... .......... .......... .......... .......... .......... .......... .......... .......... .......... ...-i ~ Lt) t--. °' ...-i ~ Lt) t--. °' ...-i ~ Lt) t--. ...-i ~ Lt) t--. .......... .......... .......... .......... .......... ...-i ...-i ...-i ...-i ...-i N N N N .......... .......... .......... .......... N N N N N .......... .......... .......... .......... .......... .......... .......... .......... .......... ~ ~ ~ ~ N N N N N N N N N j-+-Paine Webber ----JP Morgan ---· Merrill Lynch -I 9 .. _) ) Orange County Sanitation Districts Orange County Transactions • PaineWebber -Irvine Ranch Water District • JP Morgan -Irvine Ranch Water District • Merrill Lynch -County Sanitation Districts of Orange County 10 L Orange County Sanitation Districts Tax-Exempt Remarketing Fees • Merrill Lynch -The current remarketing fee for OCSD daily tax- exempt paper is 12.5 basis points. • Industry -Industry wide, remarketing fees for daily tax- exempt paper are competitive. As recently as 2/17/95, PFM observed remarketing fee quotes of 9.5 to 10 basis points for a Riverside County area wastewater JP A. 11 Orange County Sanitation Districts Increased Interest Rate Costs to the Districts (12/1/94 to Present) • Recent Merrill Lynch Remarketing Rates -Compared to JP Morgan comparable $145,000* -Compared to Paine Webber comparable $167,000* it Approximation based on selected remarketing dates 12 Orange County Sanitation Districts Recommendations • Continue monitoring the tax-exempt daily remarketing rates on a weekly basis, or • Direct Staff and PFM to issue a Request for Bids for Remarketing Agents to report to the Finance and Personnel committee with recommendations. -.. J 13 ~Merrill Lynch Mr. Gary Streed Finance and Accounting Administrator County Sanitation Districts of Orange County 10844 Ellis Avenue Fountain Valley, California 92728-8127 Dear Gary: February 28, 1995 me W. Chenevey Vice President Public Finance Debt and Equity Markets Group Two California Plaza 350 South Grand Avenue, Suite 2830 Los Angeles, California 90071 213 217 4505 FAX2132174530 Thank you for speaking with Sam Corliss and me as a follow-up to the Fiscal Policy Committee's discussion with Sam regarding Merrill Lynch's daily remarketing program for the Districts. We are aware that over the next 30 days, the Districts will be monitoring the rates on the program (consisting of three issues totaling approximately $236 million). We also understand the Committee's concern that the Districts continue to experience the lowest possible interest rates. Let me assure you that we are working diligently to ensure that the Districts' bonds continue to be remarketed at the lowest rates possible. Below, I would like to summarize the market factors we see currently affecting the remarketing program and outline our recommended action plan for consideration at the next Committee meeting. Remarketing Performance Since Orange County's Bankruptcy: • Since early December 1994, the daily rate market has been characterized by extraordinary volatility and illiquidity. • Both prior and subsequen~ to the County's bankruptcy filing, Merrill Lynch has continuously supported the Districts' programs. Moreover, in the course of our efforts to steadily reduce yields towards the Districts' pre-bankruptcy trading levels, we periodically have positioned overnight as much as $99 million of the Districts' daily rate COPs. This positioning, which typically entails a cost of carry to Merrill Lynch, results from the firm's effort to attain the lowest possible market clearing cost for the Districts in an uncertain and highly volatile market. • Merrill Lynch has worked on behalf of the Districts to steadily lower the "market clearing level" for the Districts' COPs while trying to maintain the Districts' traditionally large pool of buyers. Note that if yields are pushed down too quickly, the Districts risk losing much of its historically large buyer base, potentially resulting in a long-term increase in the Districts' cost of funds. ~Merrill Lynch Mr. Gary Streed February 28, 1995 Page 2 of3 • Due to the relatively large volume of the Districts' paper remarketed by Merrill Lynch, our remarketing levels in the weeks since the bankruptcy have necessarily reflected the "true" market clearing levels for the Districts' paper. While in selected cases other remarketing agents recently have posted lower remarketing levels than Merrill Lynch for certain Orange County based daily issues with high quality LOCs, we believe that these remarketing agents are benefiting from the relatively small size of their variable rate remarketing programs which allows them to remarket all of their paper to fringe buyers at yields ~ the market clearing level. We believe long-term performance is a better indicator of a firm's remarketing ability. Long term comparisons remove short-term aberrations in remarketing yields and provide a more definitive demonstration of each firm's ongoing commitment, ability, and staying power to produce consistently low average costs of funds. Specific to our commitment to the Districts, since December 1990, Merrill Lynch has remarketed the Districts' dailies at an average interest cost of 2.83%. Over the same time period, the J.J. Kenny high grade weekly index averaged 3.19%. Recommended Action Plan: We believe that the Districts can fully restore the trading performance of its dailies to the levels achieved by Merrill Lynch prior to the County's bankruptcy filing. However, this result requires that proactive efforts continue to be made by both Merrill Lynch and the Districts. Specifically, we recommend the following steps be taken: • Investor Meetings & Conference Calls: Arrange a series of one-on-one investor meetings and/or conference calls with key money market buyers to address questions and provide continuing information. • Continuing Efforts to Maintain/Expand the Market: Continue to lower the current yield spread slowly over the next weeks/months in order to maintain as large a pool of buyers as possible. Again, the Districts should be cautioned that if yields are lowered too quickly, a portion of the Districts current large buyer base may discontinue their support, likely resulting in a long-term higher cost of capital. • Continuing Information Dissemination: Provide continuous updates to market research analysts, rating agencies, credit enhancers and buyers. Such updates could possibly take the form of a periodic newsletter. • Investor Tours of the Districts' Facilities: In conjunction with investor meetings, possibly provide a tour of the Districts' facilities and/or service area to provide further comfort regarding the Districts' fundamentally strong economic and geographic position. ( ) ~ ~Merrill Lynch Mr. Gary Streed February 28, 1995 Page 3 of3 We would like to work with the Districts on these recommendations as we believe they will result in both short-term and long-term interest savings. If we can provide any additional assistance or information, please call me at 213/217-4505. I look foIWard to speaking with you. cc: Steve Kozak Patti Gorczyca Sincerely, Elke W. Chenevey Vice President / ,..· FINANCE AND PERSONNEL COMMITTEE AGENDA FOR MARCH 15, 1995 FPC95-16: Review of Draft Investment Policy Statement Prepared by Investment Advisor Chandler Liquid Asset Management, Inc. Summary Steve Kozak, Financial Manager, and Kay Chandler, the Districts' Investment Advisor, will present a draft Investment Policy Statement. At the January, 1995 Finance & Personnel Committee meeting, the Committee approved an interim investment policy pending development and approval of a permanent investment policy. At the February 1995 Joint Boards meeting, the Boards selected Chandler Liquid Asset Management, Inc., and Callan Associates, Inc., to prepare a permanent investment policy and conduct an external money manager search for the Districts. The draft Investment Policy Statement, prepared by Chandler, is attached for review. The final version of the Districts' investment policy will be formatted to meet the requirements of the Investment Policy Certification of Excellence Program sponsored by the Municipal Treasurers Association of the U.S. and Canada. This program is designed to recognize outstanding examples of written investment policies in the public sector throughout the U.S. and Canada. Award of a Certificate of Excellence to the Districts would be a clear example of the Board's policy commitment to an effective investment program. The details of the draft Investment Policy Statement will also be presented at the Director's Workshop on Financing and Investments, which is scheduled for Saturday, March 18, 1995, from 9:00 a.m. to noon. The Districts' Investment Advisor will prepare recommendations for final investment policies for Board consideration at their April meeting. Once the Districts' Investment Policy Statement is adopted by the Board, Callan and Associates will conduct the external money manager search. Staff Recommendation For information only. J:IWPOOCIFIN\CRANEIFPC.MTGIFPC95\ITEMS.AGDIFPC95.18 SAMPLE COUNTY SANITATION DISTRICTS OF ORANGE COUNTY INVESTMENT POLICY Adopted ____ _ I. BACKGROUND A. The County Sanitation Districts of Orange County, California (OCSD) are ... (a brief statement which describes OCSD) B. The prudent management of OCSD includes the adoption of appropriate goals, objectives, policies and guidelines for the investment of available funds. D. This Investment Policy has been adopted by the Board of Directors of OCSD at its meeting of ___ _ II. PURPOSE A. This statement is set forth by OCSD for the following purposes: 1. To establish a clear understanding for the Board, OCSD management, responsible employees and third parties of the objectives, policies and guidelines for the investment of OCSD funds. 2. To offer guidance to any investment adviser on the investment of OCSD funds. 3. To establish a basis for evaluating investment results. 8. The general purpose of this Investment Policy is to outline a philosophy and attitude which will guide the investment of OCSD funds toward the desired investment goals. It is intended to be sufficiently specific to be meaningful, yet adequately flexible to be practical. Ill. INVESTMENT GOALS C. The investment goals of the Fund shall be: 1. To provide liquidity for operating expenses and capital requirements, 2. To preserve capital, and 3. To earn a total rate of return commensurate with the first two goals. IV. INVESTMENT PERFORMANCE OBJECTIVES A The investment performance objective for OCSD shall be to earn a return over a market cycle which equal the return on an index of 91-day Treasury Bills. V. INVESTMENT POLICIES A. The Treasurer of OCSD is designated by the Board of Directors as the officer responsible for the investment of OCSD funds. The investment function shall be overseen by the Finance Committee as authorized by the Board of Directors. B. The Board of Directors of OCSD may, in its discretion, engage the services of a registered investment adviser to assist in the management of OCSD's investment portfolio in a manner consistent with OCSD's objectives. Such adviser shall be granted discretion to purchase and sell investment securities in accordance with this Investment Policy. Such adviser must be registered under the Investment Adviser Act of 1940. C. Investment securities and cash shall be held in a bank custody account in the name of OCSD D. All investments shall be made as "delivery vs. payment" transactions. VI. INVESTMENT GUIDELINES A The investment of funds for OCSD is governed by the California Government Code Section 53601 et seq. Whenever there is a Page 2 of 5 C. The average credit quality rating of the portfolio shall be at least "Aaa/AAA." D. The average duration of the portfolio shall not exceed 120% of the average duration of its benchmark Index, which will be defined by the Board of Directors of OCSD. E. The Treasurer shall communicate periodically with the investment adviser in order to keep the adviser informed <;IS to OCSD's specific short-term liquidity requirements. _ VII. DIVERSIFICATION REQUIREMENTS A. With the exception of securities issued by the U.S. government and its agencies, and money market funds as defined in Section Vl.8(3) above, no more than 5% of the portfolio may be invested in securities of any one issuer. 8. No more than 30% of the portfolio may be invested in medium term notes. C. No more than 15% of the portfolio may be invested in commercial paper. An additional 15% may be so invested if the dollar- weighted average maturity of the entire amount does not exceed 31 days. D. No more than 40% of the portfolio may be invested in banker's acceptances E. No more than 30% of the portfolio may be invested in certificates of deposit. F. No more than 15% may be invested in a combination of CMOs and asset-backed securities. G. No individual holding shall constitute more than 5% of the total debt outstanding of any issuer. VIII. REPORTING AND REVIEWS A. Transactions and portfolio holdings 1. Monthly statements of holdings and account activity are Page 4 of 5 conflict between the language of this policy and the language of the Code, the language of the Code shall prevail, except where the language of this policy is more restrictive. B. Eligible investments shall include the following: 1. Obligations of the U.S. Treasury, or securities guaranteed by the full faith and credit of the United States. 2. Obligations which are guaranteed by the full faith and credit of agencies or instrumentalities of the U.S. government, including, but not limited to, FNMA, FFCB, and FHLB. 3. No-load money market mutual funds which invest solely in short term US Treasury securities and repurchase agreements collateralized with US Treasury securities, and which have a minimum of $500 million in fund assets 4. Certificates of deposit at banks rated in one of the two highest categories by Thomson Bankwatch, and rated in the highest short- term category by Moody's Investor Services. 5. Banker's acceptances issued by banks rated in the highest short-term category by Moody's Investor Services. 6. Commercial paper issued by corporations, the short-term obligations of which are rated A1+ by Standard and Poor's, or P1 by Moody's Investor Services, or the equivalent by another rating agency. Investment in commercial paper is further restricted to that issued by U.S. corporations having total assets in excess of $500 million, and having an "A" or higher rating on its long term debt. Purchase of commercial paper may not exceed 180 days to maturity, nor represent more than 10% of the outstanding paper of the issuing corporation. 7. Corporate medium term notes rated A or higher by Moody's or Standard & Poor's. 8. Collateralized Mortgage Obligations, or CMOs, rated AAA by Moody's or Standard & Poor's. 9. Asset-backed securities rated AAA by Moody's or Standard & Poor's. Page 3 of 5 ' .! 2. required from the bank custodian and from the investment adviser. Confirmations of all transactions and movement of funds shall be forwarded promptly to OCSD. B. Investment performance 1. The investment adviser shall meet quarterly with management and/or with the Finance Committee of the Board of Directors to review account activity, economic conditions and investment performance. IX. AMENDMENTS This Investment Policy is subject to amendment or change from time to time by the Board of Directors. Any changes must be approved by the Board of Directors and communicated in writing to responsible employees, appropriate third parties and investment advisers. Page 5 of 5 I ·I t FINANCE AND PERSONNEL COMMITTEE FPC95-17: Summary AGENDA FOR MARCH 15, 1995 Consideration of a motion to renew Excess Workers' Compensation Insurance for the period May 1, 1995 to May 1, 1996, with the California Municipal Excess Workers' Compensation (CAMEX) Program. Steve Kozak, Financial Manager, will present a report regarding the renewal of Excess Workers' Compensation and Employer's Liability Insurance for the period May 1, 1995 to May 1, 1996. It is necessary for the Finance & Personnel Committee to review the Excess Workers' Compensation Insurance renewal at the March Committee meeting in order to forward a recommendation for the April meeting of the Joint Boards and obtain Board authority for insurance renewal prior to the May 1, 1995 renewal date. The Districts have maintained a self-insurance fund for primary worker's compensation coverage since 1979. An appropriation of $225,000, in lieu of premium payments, was made to the Workers' Compensation Self-Insurance Fund for primary workers' compensation coverage for FY 1994-95. Excess Workers' Compensation and Employer's Liability coverage provides the Districts, as a self- insurer, with an additional layer of Workers' Compensation insurance protection above a $250,000 retention, and Employer's Liability at $1 million each accident. The FY 1994-95 premium cost for Excess Workers' Compensation and Employer's Liability coverage through CAMEX was $29,400. During the Excess Worker's Compensation Insurance renewal process in 1994, the Boards authorized the Districts to participate in the California Municipal Excess Workers' Compensation (CAM EX) Program. This joint powers agency was formed in 1994 to provide local agencies access to lower cost excess worker's compensation coverage. Staff and Robert F. Driver Company, the Districts' Broker of Record, have reviewed Excess Workers' Compensation insurance alternatives, and have determined that the Districts should continue to participate in the CAMEX program, as described in the attached letter. Sufficient funds will be included in the FY 1995-96 Districts' Workers' Compensation Self-Insurance Fund budget to cover the premium costs which are estimated to be in the range of $24,000 to $29,500. Staff Recommendation Renew Excess Workers' Compensation and Employer's Liability Insurance for the period May 1, 1995 to May 1, 1996 with the California Municipal Excess Workers' Compensation (CAMEX) Program in an amount not to exceed $29,500. J:\WPOOC\Flt-."CRANEIFPC.MTGIFPC95VTEMS.AGOIFPC95.38 ROBERT F. DRIVER ASSOCIATES a Division of Robert F. Driver Co .. Inc. ASSOCIATES March 7, 1995 Mr. Steve Kozak, Financial Manager County Sanitation Districts of Orange County, CA P.O. Box 8127 Fountain Valley, CA 92728-8127 • COMPLETE INSURANCE/BOND SERVICE • RE: California Municipal Excess Workers' Compensation Insurance (CAMEX) Program Dear Steve, The excess Workers' Compensation insurance obtained by the County Sanitation Districts of Orange County under the captioned Program is subject to a May 1, 1995 renewal date. To that end we have previously requested from you renewal underwriting information upon which your 1995 policy year premium will be based. By way of some background history, the CAMEX Program was developed over the course of eighteen months during 1993 and 1994 and was implemented May 1, 1994. The purpose behind our developing this joint purchase program was severalfold. Most importantly, we realize the enhanced leverage of a large group which, we believe, will continue to assure broad and flexible coverage as well as stability of premiums even if adverse marketplace conditions develop in the future. We also gain the further significant benefit of negotiating premiums at substantial discounts to those generated under an individual policy. These immediate premium savings have been tangibly demonstrated when, last March, National Union bound coverage for the Districts on a single policy basis at an approximate annual premium of $38,000, a cost lower than those of several other competing insurers. Subsequently, following authorization from the Districts' Board of Directors, we replaced coverage as of May 1, 1994 through our CAMEX insurer at an annual premium of approximately $29,000, an additional savings of almost twenty-four (24%) percent. 3636 BIRCH STREET. SUITE 230. NEWPORT BEACH. CALIFORNIA 92660-26I9 (714! 756-0271 • FAX (714! 756-2713 Mr. Steve Kozak, Financial Manager County Sanitation Districts of Orange County, CA March 7, 1995 Page2 We believe that the Districts' participation in the CAMEX Program will continue to serve the Districts' Excess Workers' Compensation insurance needs much better than an individual policy placement. We are pleased to report that we anticipate rates and premiums equivalent to or slightly better than last year. Sincerely, First Vice President DHM:cpg FINANCE AND PERSONNEL COMMITTEE AGENDA FOR MARCH 15, 1995 FPC95-18: Consideration of quarterly staff summary report of training and travel costs for the quarter ended December 31, 1994 Summary: Gary G. Streed, Director of Finance, will present a summary report of training and travel costs for the quarter ended December 31, 1994. Beginning in 1993-94, the Joint Boards asked this Committee to review a staff report summarizing training and travel expenses each quarter. Accordingly, the report for the quarter ended December 31, 1994, is attached. Training, travel and meeting expenses chargeable to the Joint Operating fund are running at 41 % of the 1994-95 budget. Travel to inspect equipment fabrication for a capital project and the initial training required for a new facility may be appropriately capitalized and charged to that project. Such costs are paid through the respective capital fund, generally the Capital Outlay Revolving Fund (CORF). In order to fully report to the Committee, these charges have been captured and are included in the report. For this reason, the costs in this report will not be the same as those in the quarterly JO budget review . . Staff Recommendation Monitoring training and travel costs has been delegated to the Finance and Personnel Committee and no Executive Committee action will be required. J:IWPDOC\FIN'.cRANEIFPC.MTGIFPC95\ITEMS.AGDIFPC95.3A ... -3/7/95 Page 1 TRAINING, TRAVEL AND MEETING SUMMARY SIX MONTHS ENDED DECEMBER 31 , 1994 Number Of Local Travel, Room Ref Event or Description Attendees Days Dates Meetings Registration & Per Diem Total Costs Location Dept, Divisions Charges for First Quarter $981 .82 $15,387.51 $8,343.11 $24,712.44 2 CASA Tech & Regulatory Seminar 3 3 11/17-11/19 $330.00 $722.18 $1,052.18 Napa Dir Tech Serv,Cons/Rec/Reuse 3 CASA Tech & Regulatory Seminar 5 3 11/17-11/19 $550.00 $2,408.09 $2,958.09 Napa Directors 4 CASA Work Conference 3 8/10-8/13 $130.95 $130.95 Monterey Directors 5 CASA Legislative Comm 12/05 $323.90 $323.90 Sacramento Directors 6 Orange Co Bankruptcy Hearing 12/08 $29.60 $29.60 LA Directors 7 Water Environment Federation 4 3 10/15-10/17 $4,398.54 $4,398.54 Chicago Tee Serv, Src Cntl, Cons/Rec, Plari 8 EPA Pretreatment Workshop 3 3 11 /2-11 /4 $675.00 $2,858.50 $3,533.50 Indianapolis Tee Serv, Src Cntl 9 EPA re Waiver & Biosolids Disp 2 10/28 $723.92 $723.92 San Francisco Gen Mgr, Dir Tee Serv 10 AMSA Work Conference 4 9/24-9/27 $1,005.05 $1,005.05 Wash,D.C. Gen Mgr 11 Meeting With EPA 5 7/28-8/1 $247.00 $247.00 San Francisco Dir Engr 12 Meeting With EPA re Pretreatment 3 11/14-11/16 $169.90 $169.90 Wash,D.C. Tee Serv 13 SET AC Annual Conference 2 5 10/30-11/3 $195.00 $2,332.14 $2,527.14 Denver Compliance 14 Physics of Estuaries Seminar 3 11/28-11/30 $930.00 $390.50 $1,320.50 Mass Compliance 15 WEF Computer Modelling Course 1 /11 $395.00 $181.00 $576.00 San Francisco Air Quality 16 EDA Auto Plant 3 10/3-10/5 $995.00 $576.37 $1,571 .37 Walnut Planning & Design 17 EPA Lynx Workshop 12/08 $211.00 $211.00 San Francisco Dir Tee Serv 18 Cal EPA Task Force 6/23 $144.00 $144.00 Sacramento Cons/Rec/Reuse 19 Cal Int Waste Mgt Board(CIWMB) Seminar 9/22 $78.92 $78.92 Sacramento Cons/Rec/Reuse 20 CIWMB and Cal EPA Mtg 2 7/20 $288.00 $288.00 Sacramento Cons/Rec/Reuse 21 Fiscal Policy Comm 9/21 $198.28 $198.28 CSDOC Directors' Committees 22 Sub Comm and Exec Comm 9/28 $209.05 $209.05 CSDOC Directors' Committees 23 Steering Comm 9/29 $110.39 $110.39 CSDOC Directors' Committees 24 Planning & Design Comm 10/05 $210.34 $210.34 CSDOC Directors' Committees 25 Operations, Mtce & Tech Serv Comm 10/06 $187.49 $187.49 CSDOC Directors' Committees 26 Steering Comm 10/13 $32.80 $32.80 CS DOC Directors' Committees 27 Finance & Personnel Comm 10/19 $179.45 $179.45 CS DOC Directors' Committees 28 Executive Comm 10/26 $197.89 $197.89 CS DOC Directors' Committees / 29 Planning & Design Comm 11/02 $17.05 $17.05 CSDOC Directors' Committees 30 Operations, Mtce & Tech Serv Comm 11/02 $222.50 $222.50 CSDOC Directors' Committees 31 Planning & Design Comm 11/03 $177.79 $177.79 CSDOC Directors' Committees 32 Steering Comm 11 /15 $266.70 $266.70 CSDOC Directors' Committees 33 Finance & Personnel Comm 11 /16 $25.35 $25.35 CSDOC Directors' Committees 34 Executive Sub Comm 11/29 $201 .26 $201 .26 CSDOC Directors' Committees 35 Executive Comm 11/30 $258.34 $258.34 CSDOC Directors' Committees 36 Planning & Design Comm 12/01 $220.98 $220.98 CSDOC Directors' Committees 37 Steering Comm 12/08 $88.18 $88.18 CSDOC Directors' Committees 38 Board Meeting Supplies 12/14 $9.64 $9.64 CSDOC Directors' Committees 39 Finance & Personnel Comm 12/21 $68.71 $68.71 CSDOC Directors' Committees TRV2QTR5.XLS 5:03 PM , I 3/7/95 Page 2 TRAINING, TRAVEL AND MEETING SUMMARY SIX MONTHS ENDED DECEMBER 31, 1994 Number Of Local Travel, Room Ref Event or Description Attendees Days Dates Meetings Registration & Per Diem Total Costs Location Dept, Divisions 40 Tri TAC Meeting 1 9/08 $28.92 $28.92 Sacramento Cons/Reel/Reuse 41 Tri TAC Meeting 2 11/10 $484.92 $484.92 Oakland Tee Serv,Cons/Recl/Reuse 42 Tri TAC Meeting/Air Res Board Meeting 9/23 $319.60 $319.60 Sacramento Air Quality 43 Tri TAC Meeting 1 10/13 $178.92 $178.92 Sacramento Cons/Reel/Reuse 44 Tri TAC Retreat 2 9/29-9/30 $172.17 $172.17 Oakland Cons/Reel/Reuse 45 Tri TAC Meeting 12/08 $141.00 $141.00 Oakland Cons/Reel/Reuse 46 Calif Debt Advisory Comm Seminar 11/02 $50.00 $66.84 $116.84 San Diego Fin Mgr 47 Calif Assn Prof Purch Officers Cont 2 4 11 /17 -11 /20 $450.00 $450.00 San Francisco Purchasing 48 Computer Work Group & Training 3 6 12/10 -12/15 $4,024.00 $4,024.00 Anaheim Info Serv ) 49 Phone System Users' Group 1 6/08 $25.00 $25.00 Long Beach Info Serv 50 Oracle 7 Database Software Training 6 11 /28 -12/2 $1,750.00 $71.00 $1,821.00 Irvine Info Serv 51 Mgmt of Advanced Server Computer Training 2 4 11 /14 -11 /17 $4, 100.00 $4,100.00 El Segundo Info Serv 52 Language Skills Workshop 5 11/07 $215.00 $215.00 Fountain Valley Dir O&M, Oper 53 First Aid & CPR Training 7 11 /15 $375.00 $375.00 Fountain Valley DirO&M 54 Computer Assisted Drafting Training 2 1 11/03 $200.00 $200.00 Irvine Instrumentation 55 Lotus 4.0 and Windows Software Training 24 3 11 /1 5 -11 /17 $1,200.00 $1,200.00 CSDOC Operations 56 "How to Legally Fire Employes With Attitude Prob" 12/13 $145.00 $145.00 Costa Mesa Dir Tee Serv 57 Air Quality Technical Training Seminar 14 12/3 -12/17 $400.00 $400.00 Walnut Air Quality 58 Government Conference on the Environment 1 2122 $65.00 $65.00 Sacramento Air Quality 59 Technical Software Training 5 11 /15 $875.00 $875.00 CSDOC Planning & Design 60 "Basic Supervision" 1 12/01 $139.00 $139.00 Garden Grove Constr Mgmt 61 Parking : Gov Fin Officers Assn Training 2 9/29 & 9/30 $10.00 $10.00 Santa Monica Fin Mgr 62 Parking: Public Finance Seminar 1 11/14 $28.46 $28.46 L.A. Fin Mgr 63 "CRISP" Plant Auto Software Users' Group 2 2 12/6 -12/7 $300.19 $300.19 Nevada Info Serv 64 Emergency Overtime Meal 2 11 /01 $15.65 $15.65 CSDOC Plant Mtce 65 CWPCA Regional Training Conf 7 2 11 /1 7-11 /18 $610.00 $532.48 $1,142.48 Ventura Dir Oper & Mtce, Comp, Cons/Reel/Reuse 66 Biosolids Site Inspection 2 10/27 -10/28 $65.19 $65.19 Bakersfield Cons/Reel/Reuse 67 Empl Mileage: AQMD Meeting 1 10/14 $11.60 $11.60 Diamond Bar Air Quality 68 W Coast Cont on Current Issues in Air Toxics 2 11/9 -11/10 $125.00 $322.76 $447.76 Sacramento Air Quality 69 WQTC Standard Methods 5 11/6 -11/10 $430.00 $1,038.19 $1,468.19 San Francisco Laboratory, Srce Cntrl 70 Fed of Analytical Chem & Spectroscopy Societies 6 10/2 -10/7 $175.00 $1,539.19 $1,714.19 Missouri Laboratory 71 Effluent Disinfectant Pilot Project 2 7/12 -7/13 $104.25 $104.25 Oceanside Laboratory 72 "Visioning Orange County " 1 10/15 $125.00 $3.00 $128.00 Irvine Dir of Engr 73 Eco System Design With Nature 3 10/25 -10/27 $170.00 $443.61 $613.61 Sacramento Dir of Engr 74 Disater Preparation Conference 3 1/8 -1/10 $515.00 $641.00 $1,156.00 Georgia Source Control 75 Advanced Excel for Windows 9/28 $199.00 $199.00 Santa Ana Accounting 76 Word Perfect Training 10/01 $500.00 $500.00 Santa Ana Accounting 77 CMT A Treasurer Training 2 3 2/2-2/4 $350.00 $350.00 Pomona Dir of Finance 78 CSMFO Meeting re Investment Pools 1 11 /17 $40.00 $40.00 Placentia Dir of Fin, Acctg 79 Empl Mileage: Overtime Meetings 9, 10, 11/94 $39.90 $39.90 Various Air Quality 80 Ohmart Radiation Safey Training 8 11 /13-11 /20 $975.00 $3,612.39 $4,587.39 Ohio Instrumentation 81 Payroll Seminar 2 2 1 0/20-10/21 $84.62 $84.62 LA Personnel 82 Empl Mileage: American Septic Surveillance 6 10 10/4-10/13 $120.06 $120.06 Soruce Control 83 Empl Mileage: Emergency Call Back 1 11/20 $4.64 $4.64 CSDOC Warehouse 84 Lotus Software Training 12 11/29 $600.00 $600.00 CSDOC Dir of Oper & Mtce TRV20TR5,XLS 5:03 PM .. 3/7/95 Page 3 TRAINING, TRAVEL AND MEETING SUMMARY SIX MONTHS ENDED DECEMBER 31, 1994 Number Of Local Travel, Room Ref Event or Description Attendees Days Dates Meetings Registration & Per Diem Total Costs Location Dept, Divisions 85 Empt Mileage: Constr Mgmt 9/27 $17.40 $17.40 Construction Mgt 86 "How to Deal With Empl With Attitude Problems" 2 9/12 $139.00 $139.00 Garden Grove Laboratory 87 " Leadership Skills" 3 1/25 -1/27 $375.00 $375.00 Anaheim Planning & Design BB Confined Space Safety Training 55 5 9, 10, 11/94 $6,928.10 $6,928.10 CSDOC All Departments 89 Confined Space Safety Training 24 8/94 $379.90 $379.90 CSDOC Collection Fae Mtce 90 Confined Space Safety Training 16 7/94 $251 .14 $251.14 CSDOC Constuction Mgt 91 Confined Space Safety Training 21 7/21 $1,596.00 $1,596.00 CSDOC Planning & Design 92 Confined Space Training 1 10/27 $370.00 $13.04 $383.04 San Diego Safety 93 Cancelled attendance ($650.00) ($650.00) 94 So Calif Regional Youth Summit 3 12/9 -12/11 $168.55 $168.55 Anaheim Public Information Office 95 Windows Programming Seminar 5 11/14 -11 /18 $53.00 $53.00 El Segundo Info Serv 96 No Regional Training Cont & Comm Mtg, CWPCA 3 9/29 -10/1 $236.50 $236.50 Fresno Dir Oper & Mtce 97 Empt Mileage: Edison Power Standby 1 12/14 $11.60 $11.60 CSDOC Elect Mtce 98 Watershed Mgt Cont 3 11 /1 6 -11 /18 $85.00 $254.52 $339.52 Oregon Cons/Reel/Reuse 99 AWMA Permit Workshop 4 11 /30 -12/3 $400.00 $299.50 $699.50 Nevada Air Quality 100 Gasoline Reimbursement 11/01 $5.00 $5.00 Laboratory 101 1995 Educational Symposium 1 4 4/2 -4/5 $1,170.00 $349.00 $1,519.00 Colorado Personnel 102 Covey Seminar, Lessons in Leadership 6 12/09 $2,023.00 $2,023.00 L.A. Dept Heads 103 LIMS Users Group Training 2 5 10/24-10/28 $975.00 $3,352.39 $4,327.39 Florida Info Serv, Laboratory 104 Data Proc Management Assoc 1 4 10/30-11 /2 $495.00 $1,279.47 $1,774.47 Kentucky Info Serv 105 Tri State Seminar 6 3 9/22 -9/24 $30.00 $2,043.48 $2,073.48 Nevada Dir of Oper & Mtce 106 Santa River Basin Section CWPCA 12 2 10/18 -10/19 $1,520.00 $1,520.00 Anaheim Dir of O&M, Elect Mtce, Plan & Design 107 "How to Handle Difficult People" 1 9/16 $69.00 $69.00 Garden Grove Dir of Tech Services 108 American Public Works Assn 2 10/11 $485.00 $485.00 Ontario Compliance, Plan & Design 109 "Building Better Relationships" 10/25 $89.00 $89.00 Irvine Air Quality 110 Tele Communication Assn 5 2 10/4, 10/6 $62.00 $62.00 San Diego Info Serv 111 RJN Comp Mtce Mgt Users Group 6 6/1-6/6 $35.00 $35.00 Chicago Info Serv 112 Watersheds 1994 Expo 3 9/28-9/30 $411.28 $411.28 Washington Planning & Design 113 Genl Accepted Acctg Prin Change Seminar 11 /16 $440.00 $6.00 $446.00 LA Accounting 114 Advanced Excel 5.0 Software Training 9/27 $199.00 $199.00 Tustin Accounting ) 115 W Coast Wastewater Pollution Prev Symposium 10/3-10/4 $446.79 $446.79 San Francisco Source Control 116 New Empl Orientation 17 9/29 $53.19 $53.19 CSDOC Personnel, Various 117 Total Joint Operating Costs for This Quarter 2.882.19 40,266.14 36,697.82 79,846.15 TRV2QTR5.XLS 5:03 PM -, 3/7 /95 Page 4 TRAINING, TRAVEL AND MEETING SUMMARY SIX MONTHS ENDED DECEMBER 31, 1994 Number Of Local Travel, Room Ref Event or Description Attendees Days Dates Meetings Registration & Per Diem Total Costs Location Dept, Divisions 118 Factory Test CRISP Plant Auto Software 3 7 10/30-11/5 $1 ,991 .62 $1,991.62 Ohio Info Serv 119 Initial Trsining: CRISP Software 2 7 12/5-12/12 $2,350.00 $603.00 $2,953.00 Ohio Info Serv 120 Factory Test CRISP Plant Auto Software 2 5 1 2/ 1 3-1 2/ 1 7 $1,458.36 $1,458.36 Ohio Info Serv 121 Water Envir Fed: Biofiltration Project 6 10/14-10/19 $435.00 $1,181.02 $1,616.02 Chicago Air Quality 122 Amer Type Culture Collection Work Shop 5 10/31-11/4 $2,365.74 $2,365.74 Maryland Laboratory 123 Microbiology Seminar: NWRI Projects 2 5 5/23-5/27 $150.00 $595.31 $745.31 Nevada Laboratory 124 Air & Water Mgmt Assn : Biofiltration Project 1 7 6/18-6/24 $529.00 $529.00 Ohio Air Quality 125 AWWA AWQTC Cont: NWRI Projects 5 11/6-11/10 $430.00 $885.59 $1,315.59 San Francisco Laboratory 126 Medium Voltage Testing 5 9/9-9/13 $340.00 $340.00 Texas Constr Mgmt 127 Barber Colman/Basler Seminar 1 8/16 $75.00 $75.00 Irvine Constr Mgmt 128 Total CORF Costs for This Quarter 0.00 3.440.00 9.949.64 13,389.64 129 Total Costs for This Quarter $2,882.19 $43,706.14 $46,647.46 $93.235.79 130 Total Costs Year to Date $3,864.01 $59,093.65 $54,990.57 $117,948.23 TRV2QTR5.XLS 5:03 PM \ FINANCE AND PERSONNEL COMMITTEE AGENDA FOR MARCH 15, 1995 FPC95-19: Consideration of 1995-96 Budget Recommended Changes from Approved Critical Projects List Summarv The Operations, Maintenance and Technical Services Committee and the Planning and Design Committee have reviewed the Critical Capital Improvement Projects over the past two months. At their March meetings, the Committees reviewed a draft of the 1995-96 Capital Outlay Revolving Fund budget for Treatment Plant Improvements based upon the previously approved Critical Projects. A few Joint Works improvement projects are necessary to budget for which were not in the Critical Projects prepared in response to the County's impounding the Districts' cash. It now appears that the Orange County Investment Pool workout and release of funds will occur prior to the start of 1995-96. While staff believes it is necessary and prudent to include these projects in a budget, no costs will be incurred on new projects without review by one of the Committees or the Joint Boards. Staff Recommendation Staff recommends the Committee authorize the inclusion of $12,220,000 in the 1995-96 Joint Works Capital Outlay Revolving Fund budget to provide potential funding for important, high priority projects which were not on the Critical Projects listing considered by the Operations, Maintenance and Technical Services Committee and the Planning and Design Committee. ' March 10, 1995 STAFF REPORT COUNTY SANITATION DISTRICTS of ORANGE COUNTY. CALIFORNIA 10844 ELLIS AVENUE PO. 0ox 0121 FOUNTAIN VALLEY. CALIFORNIA 92728-8127 17141962-2411 FPC 95-19: Consideration of 1995-96 Budget Recommended Changes from Approved Critical Projects List The Operations, Maintenance and Technical Services Committee and the Planning and Design Committee have reviewed the Critical Capital Improvement Projects over the past two months. At their March meetings, the Committees reviewed a draft of the 1995-96 Capital Outlay Revolving Fund budget for Treatment Plant Improvements based upon the previously approved Critical Projects. A few Joint Works improvement projects are necessary to budget for which were not in the Critical Projects prepared in response to the County's impounding the Districts' cash. It now appears that the Orange County Investment Pool workout and release of funds will occur prior to the start of 1995-96. While staff believes it is necessary and prudent to include these projects in a budget, no costs will be incurred on new projects without review by one of the Committees or the Joint Boards. A brief description of the additions to the Critical Projects to create a budget follows: Seismic Retrofit Structural. P1-44-1. 3: This project includes structural improvements to reduce the potential damage to the treatment plants from an earthquake. The project is currently 80% through the design stage. It is recommended that the Directors approve continued funding for staff and consultant charges in fiscal year 1995-96, in the amount of $100,000 to avoid costly design stop/startup charges. The project would not proceed to construction in fiscal year 1995-96, but would be postponed until adequate construction funds are available. Miscellaneous Special Projects at Plant No. 1: Funds in the amount of $50,000 are requested to support staff investigations necessary to the prepare engineering scopes of work for future design and construction of miscellaneous projects at Reclamation Plant No. 1. The projects will be identified by staff and administered by the Small Projects Group recommended for the Engineering Department in the Ernst & Young reports. No outside charges are proposed. Future design and construction costs would be incurred when adequate funds are available. Projects will be awarded in accordance with established policies and procedures. FPC95-19 -1995-96 Budget Critical List Changes Page2 March 15, 1995 Miscellaneous Job Plan Projects at Plant 1: These projects have traditionally been budgeted at $1,000,000 per year. This item has been reduced by 50% to $500,000 for 1995-96. These funds are used primarily by our Maintenance Department to perform relatively minor rehabilitation and improvements generally by staff. Replacement Warehouse Building at Plant 2 CP2-35-2): This project is 100% designed and permitted and part of a larger Support Facilities Improvement bid package. The existing warehouse, built for temporary use by a Contractor in the late 1970's and later purchased by the Districts, is in poor repair and lacks basic facilities. By combining this project with other support projects, such as the maintenance facilities, all the projects benefit from economies of scale. Breaking the project up now into several construction projects would incur added design charges. Although the scope of this project is still being reviewed by the PDC, it is prudent to provide funding of $2,000,000 for the project so it may proceed when approved. Rehabilitate 7 Digesters at Plant 2 CP2-39): This project is approximately 50% designed. Continued funding, in the amount of $250,000 is recommended to support staff and consultant charges and to avoid relatively high stop/startup design costs. Construction costs are not budgeted to begin before 1996-97. Plant 2 Influent Diversion: This proposed new project would provide a means to temporarily bypass our influent trunk sewer metering facilities. Many of these metering facilities are in need of future repair, and bypassing one or more individual trunk sewers though temporary pumping is difficult and expensive. A bypass system similar to the bypass system at Reclamation Plant No. 1 is needed. The project also includes a new influent conduit to Headworks "B" which will enhance pumping capacity. A budget of $300,000 is proposed for fiscal year 1995-96 for staff investigations necessary to prepare a scope of work and possibly retain a consultant in the second half of the fiscal year, if adequate funding is available. Seismic Retrofit of Plant 2 Structures CP2-53-2.3): This project includes structural improvements to reduce the potential damage to the treatment plants from an earthquake. The project is currently 80% through the design 1995-96 Budget -Critical List Changes Page3 March 15, 1995 stage. The requested $50,000 would support staff and consultant charges required to finish the plans and specifications, avoiding a cost design stop/startup on the project. The project would then be postponed until adequate construction funds are available, budgeted to be late 1996-97 through 1998-99. Miscellaneous Special Projects at Plant 2: Funds in the amount of $50,000 are requested to support staff investigations necessary to the prepare engineering scopes of work for future design and construction of miscellaneous projects at Reclamation Plant No. 2. The projects will be identified by staff and administered by the Small Projects Group recommended for the Engineering Department in the Ernst & Young reports. No outside charges are proposed. Future design and construction costs would be incurred when adequate funds are available. Projects will be awarded in accordance with established policies and procedures. Reclaimed Water System at Plant 2: This request is for $250,000 for fiscal year 1995-96 to begin preparation of a scope of work, and possibly retain a designer to install a reclaimed water system at Treatment Plant No. 2. Projects are currently being reviewed to change the fire systems at each plant from "plant water" to potable water. Many other water uses are met using secondary treated or "plant water," in a separate system. At Plant No. 1, a reclaimed water system is planned using OCWD•s GAP Water. This project is a similar system at Plant No. 2, to serve as back-up for industrial water uses, cooling water and as an irrigation water source. Miscellaneous Job Plan Projects at Plant 2: These projects have traditionally been budgeted at $1,000,000 per year. This item has been reduced by 50% to $500,000 for 1995-96. These funds are used primarily by our Maintenance Department to perform relatively minor rehabilitation and improvements, generally by staff. Central Lab Modifications: This project requires a total of $260,000 in 1995-96 for expanding the Air Analysis Laboratory, converting the Laboratory storage area to a Marine Monitoring Laboratory, and building additional walls in two areas to efficiently utilize the space. These modifications will: (1) enable the Districts to bring several air analyses in-house that the Districts can perform at a lower cost; (2) minimize possible sources of contamination of 1995-96 Budget -Critical List Changes Page4 March 15, 1995 the air analyses; and (3) permit the water quality work to be run more efficiently because it will consolidate all water quality equipment, instrumentation, preparation for water quality surveys, calibration of instrumentation and equipment servicing into one location. In 1996-97, approximately $115,000 will be required to provide additional ventilation and ducting in the Air Analysis Laboratory, walls to create office space for both the Inorganic Chemistry and Organic Chemistry Sections' analysts, additional electrical lines to support additional instrumentation throughout the Laboratory, a vent over the autoclave in the Virology/Bacteriology Laboratory, and laboratory casework for the Molecular Microbiology Laboratory. In 1997-98, it is anticipated that approximately $30,000 will be required for walls and plumbing for the Air Analysis Laboratory. In 1998-98, staff anticipates requiring approximately $500,000 for building a Marine Monitoring Laboratory to support benthics, trawling and rig fishing for the NPDES permit. This will consist of installing electrical, plumbing, laboratory casework, computer and data lines into existing office space. Computerized Facilities Records and Drawing Systems (J-25-1): Staff recommends that the Directors allocate $500,000 in fiscal 1995-96 to begin this project. Staff believes that with the reduction of projects under construction, opportunities may exist to "jump-start" this project by using existing personnel that would have been assigned to other design or construction projects. This project to automate drawings and designs is one that Ernst and Young recommended for early implementation. Automate Plant 1 Headworks for Remote Operation fJ-31-3) Upgrading the existing computer monitoring system at Plant No. 1 Headworks to full control will allow the Districts to improve both operator productivity and influent flow control. Job J-31 currently includes reprogramming of the Headworks PLC software to provide monitoring by the plant-wide process computer system. This project extends this task to include full control. Improved control algorithms are to be developed for wetwell pump control, automatic control of the influent diversion gates, discharge gate at the grit chambers, and to assist flow splitting into the primary clarifiers. A budget of $1,500,000 is proposed. Replace Secondary Controls at Plant 2 and Automate for Remote Operation J-31-4) Control devices on the "Oases" oxygen control panel, and the East and West RAS/WAS control panels are old and the manufacturers have removed them from "repair'' status. The Districts consider it urgent that the panels be replaced to avoid compromising the treatment capabilities at Plant No. 2 in the event of a panel failure. 1995-96 Budget -Critical List Changes Pages March 15, 1995 A budget of $2,400,000 is proposed for this project which will provide replacement panels that will be implemented using PLC controls and be integrated into the plant- wide monitoring and control computer system, in a similar manner to the PLC controls being redesigned under Job J-31. As recommended by the master plan, the control system will incorporate full monitoring and automatic controls. Replace Plant 2 Monitoring Computer System (J-31-5) A $1,000,000 allocation is proposed for this project which will replace the Plant 2 process monitoring computer system with a system identical to the one currently being installed at Reclamation Plant No. 1. District Information Management Network: a. Maintenance & Operations Management Computer System This system has been installed for the preventive and corrective maintenance functions and is providing needed information. A budget of $100,000 is proposed to provide for a pilot study and implementation of the inventory control module and a fleet management module b. Laboratory Information Management System Upgrades To increase the efficiency and quality of the Laboratory's data and sample management capabilities, the Boards approved the purchase of the Laboratory Information Management System (LIMS) in July 1991. Implementation of this system is currently 40% complete. Staff recommends the approval of $205,000 in 1995-96 to continue the implementation of the system. The $205,000 will be spent on in-house labor, consultants, second party evaluations, training, hardware and software. The funds will be utilized for upgrading the hardware, approximately 80% to implement the sample manager software throughout the Laboratory, approximately 60% to implement report generation software, approximately 70% to implement data acquisition, training the staff on utilization of the LIMS system, and additional cabling of instrumentation to the LIMS. Funding for the LIMS system will be approximately $125,000 in 1996-97 and approximately $80,000 in 1997-98. Funding for 1996-97 will be used to complete the tasks outlined above and for upgrades to the software and hardware. Funding in 1997-98 will be utilized for upgrades to the LIMS software and hardware, additional training for the system managers, and installation of additional data lines to provide further instrument integration. Benefits from the continued work on the LIMS will include: (1) further automation of data entry and 1995-96 Budget -Critical List Changes Page6 March 15, 1995 report generation; (2) minimization of errors in data entry and report generation; and (3) automated sample tracking and management. c. Financial Information System: The existing financial information system was designed in 1977. This system's useful life cycle has expired and the system should be replaced. During 1993-94, the Districts entered into a professional consulting agreement with Deloitte & Touche, to perform a financial information needs assessment and for the development of specifications for a formal Request for Proposals, for an amount not to exceed $150,000. The work performed by Deloitte & Touche carried over into 1994-95. The financial information system project should be budgeted at $750,000 for 1995-96. Purchase of a system will require Board action. d. Network System Integration: This is an umbrella budget item to include necessary improvements and enhancements to the Districts' existing local area networks (LANs), many in response to suggestions from Deloitte & Touche and Ernst & Young. An allocation of $340,000 is proposed to provide for an enterprise-wide network, to begin work on integrating plant automation and office automation and to increase the network band width and throughput when the technology is available. e. CD -Optical Data Archiving: Staff perceives a need to develop an electronic storage program for the volumes of paper data and information that has historically been stored as hard copies. A budget of $125,000 would provide funds for an evaluation and a pilot project. Improvements to Central Generation: This request for $650,000 for fiscal year 1995-96 is to provide the design and procurement of equipment and services related to the safety, reliability and economy of operating the Central Generation facilities. These modifications would also include mechanical changes that will enhance the operations of the facility, protect equipment outside the facility and provide more information for use by the Operations Division staff. 1995-96 Budget -Critical List Changes Page 7 March 15, 1995 Power Cable Tray Improvements: This budget proposal is $200,000 for initial funding for upgrading the Districts' Power Distribution and Control System. A large number of these conduits are in cable trays and many of these trays are very old. Ultimately, the old conduits should be replaced with new conduits meeting current codes and each conduit should be tagged. This project will eliminate a safety problem. Air Quality Control Program: a. Toxics and ROG Control: Biotrickling Filter R&D This project requires reallocation of $40,000 from the 1996-97 budget to the 1995-96 budget. The proposed revised allocation of $90,000 for 1995-96 is the cost for completing the existing project as approved by the Boards. The $50,000 remaining in the 1996-97 budget would be used for site evaluation and planning efforts pertaining to the full-scale application of biotreatment as an air pollution control technology. Additionally, $100,000 should be budgeted for the 1997-98 year for the design of a full-scale reactor. The construction costs for the future are unknown at this time. b. Air Emissions: Source Control Feasibility Study/Metals This project requires a reallocation of $50,000 from the 1996-97 budget to the 1995-96 budget. A total revised allocation of $75,000 for 1995-96 is required for this project. This project is required to be completed during the 1995-96 fiscal year in order to obtain information necessary for determining a possible control technology for reducing toxics and VOC emissions. This is important because SCAQMD is currently developing a guidance document for Best Available Control Technology (BACT) that will include toxics control and rule development to reduce VOC emissions form POTW processes. This study will require extensive testing of plant influent as well as sampling from different industrial and domestic sources and emissions modeling. No expenditures are anticipated for this study in the future. J:\WPOOC\FIN\CRANE\FPC.MTG\FPC95\STAFFRPT.FPC\SR3-15-9.BCL A B 2020VISION REVISED TOTAL MSTR PLAN PROJECT EST ORIG EST A. Reclamation Plant 1 New and Rebudgeted Major Projects 1. Electrification of Pump Drives, P1-36-1 c 1,800,000 2. Secondary Trmt Expansion to 80 MGD, P1-36-2 21,697,000 c 48,600,000 3. Primary Treatment 72 MGD Expansion, P1-37 32,500,000 c 38,125,000 4. Security & Landscaping, P1-38-1 1,600,000 5. Misc. Mods. Priority Elements P1-38-2 a 5,300,000 6. Misc. Improvements to Plant 1 P1-38-4 3,000,000 2,800,000 7. Fire Protection, Signs & Water Sys Mods P1-38-5 a 3,060,000 8. Elecll. Fae. Mods. and Safely Upgrades P1-40-1 a 8,625,000 9. Facility Mods. and Safely Upgrades P1-40-2 a 2,025,000 10. Primary Clarifier Rehab. P1-41 a 2,350,000 11. Seismic Retrofit of Non-Struct Systems P1-43 a 4,250,000 12. Seismic Retrofit, Structural Items P1-44-1,3 a 4,250,000 13. Chemical and Wastehauler Fae Mods, P1-46-2,3 a 3,020,000 14. 12KV Distribution Sys for Support Fae., P1-47 a 2,110,000 15. Misc. Arch. and Trtmnl. Pit. Imp, P1-48 a 1,885,000 16. 40 MGD Oxygen Activated Sludge & DAF's 65,463,000 65,463,000 17. Belt Presses (4 Units) 14,300,000 14,300,000 18. Solids Storage (4 Bins) 10,140,000 10,177,000 19. Digesters: 2@ 110' Diameter 9,100,000 9,100,000 20. 12kv Electrical Power Distribution 2,477,000 2,477,000 21. Emergency Sewage Bypass System 1,992,000 1,922,000 22. Remove Trickling Filters 1 & 3 1,300,000 1,300,000 23. Miscellaneous Special Projects Pint. 1, P1-49 a 4,385,000 24. Miscellaneous Job Plan Projects 27,000,000 22,125,000 25. other Master Plan Projects a. Headworks No. 1 Rebuild, 2003 14,950,000 14,950,000 b. Headworks No.2 Impeller/Pump Speed, 2016 2,600,000 2,600,000 c. Remove Trickling Fillers 2 & 4, 2007 1,300,000 1,300,000 d. 40 Mgd Oxygen Act'd Sludge &DAF, 2017 34,000,000 34,000,000 e. 110 ft Digesters, 2003 & 2012 18,200,000 18,200,000 f. 4 Belt Presses, 2004 10,920,000 10,920,000 g. 12 KV Power Distribution, 2001-2012 1,099,000 1,099,000 h. Standby Power Generation, 2005 & 2015 4,914,000 4,914,000 i. 72 Mgd Primary Treatment, 2004 & 2012 32,500,000 32,500,000 SUB-TOTAL -RECLAMATION PLANT 1 309,452,000 381,532,000 CORF3B96.XLS CAPITAL OUTLAY REVOLVING FUND SUMMARY OF JOINT WORKS CONSTRUCTION REQUIREMENTS 1995-1996 TO 2004-2005 c D E F G ESTACCUM REQUIRED ESTIMATED ESTIMATED ESTIMATED COSTS TO BUDGET BUDGET BUDGET BUDGET 6130195 1995-96 1996-97 1997-98 1998-99 1,300,000 500,000 3,600,000 10,000,000 15,000,000 11,000,000 5,000,000 125,000 1,000,000 5,000,000 10,000,000 12,000,000 1,500,000 100,000 4,800,000 500,000 2,500,000 300,000 560,000 1,000,000 1,100,000 400,000 225,000 500,000 4,000,000 3,000,000 425,000 800,000 600,000 200,000 300,000 1,500,000 500,000 50,000 125,000 3,000,000 1,125,000 1,050,000 100,000 100,000 2,000,000 1,000,000 420,000 1,300,000 1,300,000 160,000 400,000 1,500,000 50,000 85,000 1,000,000 800,000 50,000 1,000,000 10,000 50,000 250,000 275,000 2,000,000 125,000 500,000 500,000 500,000 500,000 17,310,000 17,750,000 30,150,000 30,950,000 24,500,000 3/10/95 H I ESTIMATED FIVE BUDGET YEAR 1999-00 TOTAL 500,000 4,000,000 45,000,000 10,000,000 38,000,000 100,000 500,000 300,000 2,500,000 900,000 8,400,000 1,600,000 2,050,000 4,125,000 3,200,000 2,600,000 1,950,000 1,800,000 1,427,000 2,477,000 500,000 3,075,000 500,000 2,500,000 17,327,000 120,677,000 SCHEDULE B-1 Page 1 J ESTIMATED BUDGET 2000-2005 463,000 14,300,000 6,000,000 9,100,000 1,922,000 1,300,000 1,300,000 2,500,000 36,885,000 K L TEN COST TO YEAR COMPLETE TOTAL PROJECTS 500,000 45,000,000 38,000,000 100,000 500,000 300,000 2,500,000 8,400,000 1,600,000 2,050,000 4,125,000 3,200,000 2,600,000 1,950,000 1,800,000 463,000 65,000,000 14,300,000 6,000,000 4,177,000 9,100,000 2,477,000 1,922,000 1,300,000 4,375,000 5,000,000 17,ooo,oor 14,950,000 2,600,000 1,300,000 34,000,000 18,200,000 10,920,000 1,099,000 4,914,000 32,500,000 157,562,000 206,660,000 8:45 AM A B 2020VISION REVISED TOTAL MSTR PLAN PROJECT EST ORIG EST B. Plant 2 New and Rebudgeted Major Projects 1. Support Facilities and Site Improvements a. Operations Building, P2-23-5-1 3,125,000 3,550,000 b. Warehouse Building, P2-35-2 4,950,000 3,820,000 c. Maintenance Building , P2-35-3 5,488,000 4,000,000 d. Phase II Site & Security Imp., P2-35-5 2,300,000 2,475,000 e. Construction Office, M044 (P2-35-4) 1,288,000 d 690,000 2. Rehabilitate 7 Digesters, P2-39 5,000,000 e 14,225,000 3. Primary Treatment 24 MGD Expansion, P2-41 14,300,000 14,505,000 4. Secondary Treatment Expansion, P2-42-2 10,270,000 18,000,000 5. Priority Misc. Mod. , P2-43-1 a 4,900,000 6. Misc. Modifications , P2-43-3 a 2,700,000 7. Plant 2 Influent Diversion 2,500,000 8. Fire Protection, Signs & Water Sys Mods P2-46 3,809,000 4,615,000 9. Elect!. Fae. Mods. and Safety Upgrades P2-47-1 a 3,450,000 10. Facility Mods. and Safety Upgrades P2-47-2 a 4,015,000 11. Primary Clarifier Rehab. P2-48 a 6,800,000 12. Seismic Retrofit of Non-Struct Systems P2-50 a 4,800,000 13. Seismic Retrofit, Structural Items P2-53-2,3 4,305,000 f 8,410,000 14. Chemical and Plant Water Mods., P2-55 a 4,200,000 15. Misc. Seismic Mods and Flare Imp, P2-56 a 425,000 16. Miscellaneous Special Projects Pint. 2 a 5,720,000 17. Solids Storage: 2 Bins 5,200,000 5,200,000 18. Additional 105 Foot Digester 3,900,000 3,900,000 19. Plant Water Pump Station 1,170,000 1,170,000 20. Reclaimed Water System Pint. 2 3,746,000 4,920,000 21. Miscellaneous Job Plan Projects 27,000,000 22,250,000 22. other Master Plan Projects a. Replace Primary Basins A, B, C, 2006 11,700,000 11,700,000 b. Standby Power Generation, 2005 & 2015 16,120,000 10,000,000 c. Monitoring and Control System, 2005 520,000 520,000 SUB-TOTAL -PLANT 2 124, 191,000 173,460,000 C. Water Reclamation Regional Ex11ansion 77,000,000 75,500,000 CORF3B96.XLS CAPITAL OUTLAY REVOLVING FUND SUMMARY OF JOINT WORKS CONSTRUCTION REQUIREMENTS 1995-1996 TO 2004-2005 c D E F G ESTIMATED REQUIRED ESTIMATED ESTIMATED ESTIMATED C.l.P. BUDGET BUDGET BUDGET BUDGET 6/30/95 1995-96 1996-97 1997-98 1998-99 3,350,000 200,000 320,000 2,000,000 1,400,000 100,000 300,000 2,000,000 1,600,000 100,000 180,000 200,000 1,000,000 1,000,000 290,000 250,000 150,000 700,000 250,000 4,000,000 5,000,000 3,500,000 5,000 200,000 16,100,000 1,400,000 500,000 4,800,000 100,000 2,500,000 200,000 300,000 1,400,000 800,000 515,000 2,500,000 1,500,000 100,000 200,000 500,000 2,500,000 250,000 390,000 2,000,000 1,500,000 125,000 300,000 1,500,000 4,500,000 500,000 200,000 3,500,000 1,100,000 3,360,000 50,000 1,000,000 3,000,000 1,000,000 100,000 2,000,000 2,000,000 100,000 50,000 150,000 225,000 50,000 250,000 2,000,000 1,750,000 400,000 2,400,000 250,000 250,000 1,500,000 1,750,000 250,000 500,000 500,000 500,000 500,000 33,910,000 15,700,000 24,975,000 18,825,000 12,350,000 600,000 100,000 200,000 200,000 200,000 3/10/95 H I ESTIMATED FIVE BUDGET YEAR 1999-00 TOTAL 200,000 3,500,000 3,700,000 95,000 2,295,000 400,000 500,000 13,250,000 200,000 400,000 1,900,000 100,000 200,000 2,500,000 4,100,000 3,250,000 3,625,000 6,500,000 4,600,000 5,050,000 4,100,000 375,000 500,000 4,550,000 2,400,000 5,200,000 3,750,000 500,000 2,500,000 4,195,000 76,045,000 200,000 900,000 SCHEDULE B-1 Page2 J ESTIMATED BUDGET 2000-2005 275,000 14,100,000 2,000,000 2,500,000 18,875,000 50,000,000 K L TEN COST TO YEAR COMPLETE TOTAL PROJECTS 200,000 3,500,000 3,700,000 2,295,000 400,000 13,525,000 14,500,000 1,900,000 100,000 200,000 2,500,000 4,100,000 3,250,000 3,625,000 6,500,000 4,600,000 5,050,000 4,100,000 375,000 4,550,000 1,170,000 5,200,000 2,000,000 1,900,000 1,170,000 3,750,000 1,170,000 5,000,000 17,000,000 11,700,000 10,000,000 520,000 94,920,000 44,630,000 50,900,000 24,000,000 8:45 AM plant and Joint Facilities D. Inter 1. Su pport Facilities and Site Improvements a. De molition of Old Lab, J-11-1 b. Ce ntral Lab Modifications c. De molition or Reuse of Old Control Center d. De molition of Support Bldg.@P2, J-27 fall & Booster Pump Stations 2. Out a.S b.O c. Ext urge Tower Replacement J-34-1 utfall Reliability & Pumping Annex OOBS "C" J-34 & Repl 78" to Deep Water W/120" Outfall 3.Co mputerized Fae. Records and Dwg. Sys. J-25-1 4. Ele ell. Power Systems Rehab. Studies J-25-2,3&4 5. Pia nts 1&2 Monitor/Control Sys J-31-1,2,3,4,5 ndby Power & Reliability Mods. J-33-1,2 6. Sta 7.Bu 8. Bio shard lnterplant Trunk Replacement solids Disposal Projects a. C ompost Demonstration Plant b. La nd Acquisition ndfill Development Phase I c. La d.C ompost Facility e. Bi osolids Disp. Landfill· Phase II 2011 f. Bio solids Disp. Equip Phase I & II 2001 g. El ectrical Power Distribution, 12 Kv 9. Dis Irie! Information Management Network a. M aint. & Oper Mgmnt Computer System b. La b Information Management System Upgrades c. Fi nancial Information System d. N etwork System Integration e. C D-Optical Data Archiving 10. ln-Plant Sampling System Mod provements to Central Generation 11. Im 12.Ca 13. Mi ble Tray Improvements sc Job Plan Projects SUB SUB -TOTAL -INTERPLANT & JOINT -TOTAL -MAJOR PROJECTS CORF3B96.XLS A B 2020VISION REVISED TOTAL MSTR PLAN PROJECT EST ORIG EST 330,000 910,000 245,000 190,000 1,300,000 h 6,800,000 31,085,000 31,085,000 56,640,000 k 92,050,000 5,210,000 a 1,225,000 i 15,700,000 9,204,000 j 14,925,000 26,370,000 31,000,000 9,000,000 9,000,000 22,000,000 22,000,000 28,600,000 28,600,000 50,000,000 50,000,000 15,600,000 15,600,000 11,550,000 11,500,000 2,707,000 2,707,000 1,050,000 460,000 1,170,000 820,000 125,000 220,000 650,000 2,400,000 13,500,000 16,525,000 277,556,000 362,497,000 788, 199,000 992,989,000 CAPITAL OUTLAY REVOLVING FUND SUMMARY OF JOINT WORKS CONSTRUCTION REQUIREMENTS 1995-1996 TO 2004-2005 c D E F G ESTIMATED REQUIRED ESTIMATED ESTIMATED ESTIMATED C.l.P. BUDGET BUDGET BUDGET BUDGET 6/30/95 1995-96 1996-97 1997-98 1998-99 30,000 300,000 5,000 260,000 115,000 30,000 500,000 115,000 30,000 100,000 110,000 80,000 750,000 1,700,000 3,300,000 1,000,000 50,000 85,000 50,000 1,000,000 210,000 500,000 750,000 1,000,000 1,500,000 25,000 500,000 500,000 200,000 1,800,000 7,900,000 2,500,000 1,500,000 1,000,000 425,000 500,000 2,000,000 4,000,000 6,000,000 1,000,000 2,700,000 6,300,000 300,000 1,700,000 800,000 100,000 150,000 50,000 205,000 125,000 80,000 220,000 200,000 750,000 340,000 380,000 100,000 125,000 20,000 100,000 25,000 25,000 25,000 650,000 200,000 400,000 600,000 600,000 525,000 500,000 500,000 500,000 500,000 5,020,000 13,780,000 12,210,000 13,545,000 18,660,000 56,840,000 47,330,000 67,535,000 63,520,000 55,710,000 3/10/95 H I ESTIMATED FIVE BUDGET YEAR 1999-00 TOTAL 300,000 905,000 245,000 80,000 6,050,000 1,000,000 1,085,000 1,000,000 2,000,000 1,250,000 5,000,000 1,200,000 1,000,000 13,900,000 2,000,000 14,500,000 5,000,000 6,000,000 9,000,000 2,000,000 250,000 410,000 950,000 820,000 125,000 25,000 200,000 650,000 600,000 2,400,000 500,000 2,500,000 12,375,000 70,570,000 34,097,000 268,192,000 SCHEDULE B-1 Page 3 J ESTIMATED BUDGET 2000-2005 30,000,000 75,000,000 25,000,000 1,000,000 13,000,000 5,000,000 5,000,000 154,000,000 259,760,000 K L TEN COST TO YEAR COMPLETE TOTAL PROJECTS 300,000 905,000 245,000 80,000 6,050,000 31,085,000 77,000,000 15,000,000 5,000,000 1,200,000 13,900,000 14,500,000 31,000,000 9,000,000 3,000,000 19,000,000 13,000,000 15,600,000 5,000,000 45,000,000 15,600,000 11,500,000 2,707,000 250,000 410,000 950,000 820,000 125,000 200,000 650,000 2,400,000 7,500,000 8,500,000 224,570,000 132,907,000 527,952,000 408,197,000 8:45 AM A B 2020VISION REVISED TOTAL MSTR PLAN PROJECT EST ORIG EST E. Special Projects, Studies & Research 1. Master Planning Issues a. Pers/Admin. Support Fae @Pit 1 J26, J30 1,888,000 225,000 b. Second Ocean Discharge Study 2,850,000 c. Collection, Trtmnt & Disposal Fae. Master Plan 4,275,000 d. NPDES Permit Support 1,175,000 2. Air Quality Control Program a. Toxics and ROG Control: Biotrickling Filter R&D 250,000 b 440,000 b. Air Emissions: Source Control Feasibility Study/Metals 75,000 c. Air Quality Management Implementation Plan 150,000 d. Biofilter for Pump Stations 50,000 e. A.Q. Database Development 75,000 f. Central Gen Parameter Monitoring 350,000 SUB-TOTAL -SPECIAL PROJECTS 2,138,000 9,315,000 F. Equipment Items 32,550,000 52,725,000 G. Master Plan "Alloc For Rehab & Repairs" Allocated to "a" Projects Above 195,000,000 TOTAL JOINT WORKS CAPITAL REQ 1,017,887,000 1,055,029,000 Projected Average Daily Flow in MGD Estimated Future Capital Requirements From Last Year's Budget CORF3B96.XLS CAPITAL OUTLAY REVOLVING FUND SUMMARY OF JOINT WORKS CONSTRUCTION REQUIREMENTS 1995-1996 TO 2004-2005 c D E F G ESTIMATED REQUIRED ESTIMATED ESTIMATED ESTIMATED C.l.P. BUDGET BUDGET BUDGET BUDGET 6/30/95 1995-96 1996-97 1997-98 1998-99 75,000 150,000 50,000 400,000 400,000 500,000 500,000 25,000 250,000 1,000,000 2,000,000 1,000,000 425,000 100,000 50,000 200,000 90,000 50,000 100,000 75,000 50,000 50,000 50,000 50,000 25,000 50,000 350,000 775,000 1,140,000 1,700,000 2,600,000 1,500,000 3,000,000 2,500,000 2,500,000 2,500,000 57,615,000 51,470,000 71,735,000 68,620,000 59,710,000 1994-95 237 MGD 246 MGD 252 MGD 257 MGD 265 MGD 67,805,000 83,494,000 63,035,000 55,650,000 33,077,000 3/10/95 H I ESTIMATED FIVE BUDGET YEAR 1999-00 TOTAL 225,000 1,000,000 2,800,000 4,250,000 100,000 250,000 240,000 75,000 100,000 50,000 50,000 350,000 1,100,000 8,040,000 2,500,000 13,000,000 37,697,000 289,232,000 272 MGD 41,878,000 277,134,000 SCHEDULE B-1 Page 4 J ESTIMATED BUDGET 2000-2005 500,000 500,000 12,500,000 272, 760,000 285 MGD 209,390,000 K L TEN COST TO YEAR COMPLETE TOTAL PROJECTS 225,000 2,800,000 4,250,000 750,000 240,000 75,000 100,000 50,000 50,000 350,000 8,540,000 25,500,000 27,225,000 561,992,000 435,422,000 360 MGD 486,524,000 391,204,000 8:45 AM CORF3896.XLS CAPITAL OUTLAY REVOLVING FUND SUMMARY OF JOINT WORKS CONSTRUCTION REQUIREMENTS 1995-1996 TO 2004-2005 Footnote Summary a A portion of the "Allocation For Rehabilitation & Repairs" line item in the 2020 Vision Masterplan. b The Original Estimate from the 1989-90 CORF budget prepared prior to approval of the 2020 Vision Masterplan. c The Masterplan estimate was too low. d Original Estimate is from 1989-90 budget. Project is now trailers, not a permanent building. e Includes additional digester cleaning and grit disposal not in Masterplan estimate. f Revised costs are based on current needs analysis and estimates. g Current estimates are based on a larger building than that considered during the Masterplan preparation. h New project is for an all new surge tower and valves rather than an extension. Project need and scope has increased considerably because of change to process control rather than just monitoring. SCHEDULE B-1 Page 5 j This was considered a District 3 Trunk Sewer Rehabilitation in the 2020 Vision Masterplan, and was "budgeted" there for $26,370,000. The project is really an lnterplant Line rehabilitation, so the Masterplan allocation has been moved. k Project scope changed to an estimated 7 mile long and deeper outfall. 3/10/95 8:45 AM FINANCE AND PERSONNEL COMMITTEE AGENDA FOR MARCH 15, 1995 F PC95-20: Consideration of cash awards and certificates of commendation for Personal Responsibility in Daily Effort (PRIDE) suggestions. Summary: During the past few months, several PRIDE suggestions have been submitted for consideration and evaluation. The reviews have been completed and recommendations for certificates and cash awards totaling $5,584.00 for cost savings of $147,900.00 and safety improvements in accordance with the Board-approved PRIDE program, are summarized in the attached staff report. The cost-savings and safety suggestions to be considered were received from Operations and Maintenance Department employees. Bob Ooten and Ed Hodges will review the suggestions with the Committee. Staff Recommendation Administration of the PRIDE program has been assigned to the Finance and Personnel Committee; no recommendation to the Executive Committee is required. J:\WPOOC\FIN""'....RANBFPC.MTGIFPC95VTEMS.AGDIFPC95.20 March 15, 1995 FPC 95-20: STAFF REPORT Proposed Pride Awards Nos. 285, 345, 361, 372, 382, 387, 390, 395,401,422,428,436,437,447,448 During the past few months, several Personal Responsibility in Daily Effort (PRIDE) proposals have been evaluated. Following is a summary of those safety or cost-saving proposals that staff recommends for certificates and cash awards, in accordance with the Board-approved PRIDE program. The recommended safety improvement awards total $500.00, and the cost-saving awards total $5,084.00 for a savings of $147,900.00. PRIDE NO. 285.: AUTOMATE TRICKLING FILTER BACKFLUSH Trickling filters are backflushed every day except in the winter months when they are backflushed two to three times each week. This proposal to automate the trickling filter backflushing process will save an estimated 350 work hours each year. Automation would also reduce the possibility of an operator error and would make the process more efficient. An award of 10% of the first year's net savings or $676.00 is recommended for Ronald L. Wade, Operations Supervisor. PRIDE NO. 345: GRIT AUGER WASH SYSTEM Some wet and organic laden grit was sticking to the grit augers and dumped in the disposal bins. This proposal to wash the materials out by installing a spray system on the augers will improve grit quality and decrease plant odors. A $100.00 award for unquantifiable process improvements and odor reduction is recommended to be shared by Warren Hawkins, Sr. Plant Operator and Richard A. Chavez, Plant Operator. PRIDE NO. 361 : CENTRAL GENERATION CHEMICAL STORAGE Fifty-five gallon drums of chemicals are currently stored for use in the central generation facilities' basement. This proposal to move the drums upstairs and outside will reduce handling of the drums and will remove a potential hazard from inside the building. A safety proposal award of $100.00 is recommended for Donald R. VanVoorst, Pump Power Operator. PRIDE NO. 372: DIGESTER OVERFLOW EXCEPTION TESTING Digester samples are analyzed regularly to determine their operational efficiency. This proposal to increase the level at which additional sampling is required will reduce the number of additional samples analyzed by 186 each year without impacting plant performance. An award of 10% of the net first year's savings or $165. 00 is recommended for Michael Vuong. FPC95-20 -Proposeo .• DE Awards Page 2 March 15, 1995 PRIDE NO. 382: SECURE FIRE EXTINGUISHERS Several fire extinguishers within the plants are vulnerable to falling and being damaged during an earthquake. This proposal to better secure these fire extinguishers will increase the likelihood of their availability when needed. A $100.00 safety program award is recommended for Tony Baxter, Operations Supervisor. PRIDE NO. 387: HOT WATER LOOP PRESSURE RELIEF Hot water loop pressure changes have caused specially treated city water to be wasted and water loss causes to be untraceable. This proposal to put an air pressure regulator and relief valve in the expansion tanks will cure these problems, saving water, chemicals and maintenance labor. It will also allow staff to know that water loss indicates a leak in the system. An award of $1, 109.00, 10% of the first year's net savings, is recommended for Pump Power Operator Denard R. VanVoorst. PRIDE NO. 390: SCRUBBER FLAPPER VALVE SAFElY As originally installed, the flapper valves at the North Scrubber Complex required staff to climb a ladder for operations. This proposal to install chains to operate these valves will reduce employees' exposure to risk and will save some time. A $100.00 safety program award is recommended to be shared by Thomas Rood, Jr., Operations Supervisor; George Charette, Electrical Field Supervisor; and Lawrence Rood, Mechanical Field Supervisor. PRIDE NO. 395: DRY WELL VENT FAN FAILURE ALARM This proposal is to install an alarm light at the top of the stairway in "B" Headworks. This alarm light would indicate that the dry well vent fans had failed and would alert staff to potential hydrogen sulfide exposure. A $100.00 safety program award is recommended for Dan Houck, Operations Supervisor. PRIDE NO. 401: H2S CALIBRATION GAS PRODUCTION Maintenance staff uses bottled hydrogen sulfide gas to calibrate and repair a large number of portable or stationary gas detectors. This proposal to purchase and use an H2S gas generator will eliminate the need to purchase the bottled gas and will reduce costs. The award of $388.00, 10% of the first year's net savings, is recommended for Robert M. Bell, Jr., Instrument Maintenance Worker. PRIDE NO. 422: ENGINE CONDITION INDICATION ADAPTOR A manufacturer's safety bulletin recommended the replacement of all of the adaptors needed to monitor the cylinder condition of the central generation engines. The manufacturer proposed a replacement part costing $1,248.00 each with a 20 week FPC95-20 -Proposec. Page 3 March 15, 1995 . ....---....\ )OE Awards delivery. Staff was able to develop a local replacement at a cost of $285.00 each with a six week delivery. The PRIDE Program maximum award of $1,500.00 is recommended to be shared by Bruce Chapman, Mechanical Foreman, and Larry Wilkerson, Lead Mechanic. PRIDE NO. 428: AIR SIPHON BLOWER PIT HANDRAILS This proposal is to install handrails with midboards and kickboards, along with an access ladder in the air siphon blower pit for the Gisler Trunk Junction Box. A $100.00 safety program award is recommended for Richardo A. Chavez, Plant Operator. PRIDE NO. 436: ROTHROCK/0.0.B.S AIR CONTROL CABINET The air system controls for the Rothrock and Ocean Outfall Booster Stations have not been enclosed or protected. This proposal to put the controls into a box would eliminate the possibility of an accidental shut-off and would reduce the opportunity for sabotage. Keeping this air system operational is critical to avoiding an overflow to the Santa Ana river. The PRIDE Program minimum award of $100.00 for unquantifiable savings is recommended for Frank P. Chavez, Plant Operator. PRIDE NO. 437: DIFFUSER SHEATH INSTALLER Maintenance staff was able to replace fewer than five diffuser sheaths per hour and was experiencing backaches and blisters during the process. Two Mechanical Maintenance Division employees developed a tool that would increase the installation rate to approximately 14 per hour and eliminate the backache and blisters. During the replacement of 1,290 diffuser sheaths in each of eight basins over the next year, this tool will save approximately $8,000.00. An award of 10% of the first year's savings, $800.00, is recommended to be shared by Emilio Ariston, Sr. Mechanic and Henry Lorimer, Mechanic. PRIDE NO. 447: KIMSTART WATER HEATER ELEMENTS Special heating elements and housings have been used in the Plant 1 and 2 generator hot water heaters. This proposal to use a standard heating element used elsewhere in the plants reduces the cost and the labor for each replacement. A minimum award of $100.00 is recommended for Wayne W. Aegerter, Electrical Leadman. PRIDE NO. 448: REBUILD CONVEYOR MOTION SWITCHES This proposal is to send failed conveyor motion switches to be rebuilt for future use at the districts in place of more expensive, new replacement switches. An award of $146.00, equal to 10% of the first year's estimated savings, is recommended for Wayne W. Aegerter, Electrical Leadman. (12): Summary FINANCE AND PERSONNEL COMMITTEE AGENDA FOR MARCH 15, 1995 Consideration of upcoming meetings and items to be discussed at those meeting. The calendar of future meetings is on the back of the Notice of Meeting each month. The next Finance and Personnel Committee meeting is scheduled for Wednesday, April 12, 1995. This will be the first meeting on the new schedule. Some of the potential major non-routine items the Committee will be reviewing, considering and acting on over the next few months follow. Some items will carry forward to future months, but are listed only once at the start of a process. PRIDE Program Revisions Debt Financing Strategy for 1995-2000 Formation of Financing Team Staff Recommendation Information only item. J:IWPOOCIFIN\CRANEIFPC.MTGIFPC95\ITCMS.AGDIAGOITM14.295 County Sanitation Districts of Orange County, California P.O. Box 8127 • 10844 Ellis Avenue Fountain Valley, CA 92728~127 Telephone: (714) 962-2411 FILED MINUTES OF FINANCE AND PERSONNEL COMMITTEE In the Office.of ~he S~cr~tan No(s) '/ MAR 0 81995 By --L-l -1-K.::.:.-. --Wednesday. February 15. 1995. 5:30 P.M. A meeting of the Finance and Personnel Committee of the County Sanitation Districts Nos. 1, 2, 3, 5, 6, 7, 11, 13 and 14 of Orange County, California was held on February 15, at 5:30 p.m., at the Districts' Administrative offices. (1) ROLL CALL The roll was called and a quorum declared present, as follows: Committee Directors Present: George Brown, Chairman John C. Cox, Jr., Joint Chairman Jan Debay Burnie Dunlap James H. Flora John M. Gullixson Wally Linn Thomas Saltarelli Roger R. Stanton, Vice Chairman Peer Swan, Vice Joint Chairman Committee Directors Absent: William G. Steiner Staff Present: Blake Anderson, General Manager Gary G. Streed, Director of Finance Gary E. Hasenstab, Director of Personnel Ed Hodges, Asst. Director of Operations Bob Ooten, Asst. Director of Maintenance Michael D. White, Controller Steve Kozak, Financial Manager Laurie Bluestein, Acting Laboratory Manager Don Mcintyre, Incoming General Manager Others Present Patti Gorczyca, Public Financial Management Sam Corliss, Merrill Lynch Ed Alario, Anaheim Public Utilities (2) APPOINTMENT OF A CHAIRMAN PRO TEM No appointment was necessary. (3) PUBLIC COMMENTS Ed Alario of the City of Anaheim informed the Committee that he would answer questions regarding Item No. 7, Excess Capacity Charges. Sam Corliss of Merrill Lynch informed the Committee that he would answer questions regarding FPC95-14, Consideration of Review of Remarketing Agent. Minutes of Finance & r )Sonnel Committee Page2 February 15, 1995 (4) REPORTS OF THE COMMITTEE CHAIR, GENERAL MANAGER. DIRECTOR OF FINANCE/TREASURER. DIRECTOR OF PERSONNEL AND GENERAL COUNSEL (a) Report of the Committee Chair None. (b) Report of the General Manager Blake Anderson reported that he had spent most of the day at an Investment Pool Committee meeting. The mood of the Pool participants, he reported, was increasingly restless and frustrated. Mr. Anderson reviewed the County Plan as reported at the Board meeting last week; 77% cash, 3% recovery notes, 9% senior secured claim, 11 % subordinated claim. There seems to be consensus on the acceptability of an initial 80% front-end cash and note deal, but great concern over the 20% of claims which have an unacceptable degree of uncertainty because they are backed only by the litigation receipts that may be successfully obtained by the County. The Committee members discussed the County Plan, the action of the Pool Committee, the attitudes of the cities and the County, and the proper position of the Districts in the matter at great length. The Pool Committee is expecting to ask for a vote in March. At that time, the General Manager will seek Board direction. (c) Report of the Finance Director/Treasurer Finance Director/Treasurer Gary G. Streed, reported that the County has issued a brief Investment Pool Portfolio Summary as of January 31, 1995, through Soloman Brothers Asset Management, Inc. The Summary and cover letter were included in the Committee's agenda packet for their review. Mr. Streed advised that all funds continue to be invested in Treasury and Government Agency securities as follows: January 31, 1995 Total Funds $5.5 Billion Average Maturity 7 Days Longest Maturity 21 Days Average Yield 5.38% Joint Chairman Cox asked for more information in future reports about the change in the County balances. Minutes of Finance & Pe ""lnnel Committee I ... Page 3 February 15, 1995 Mr. Streed summarized the Districts' total cash position at month end, including our share of the above as follows. The pre-petition balance reported has not been reduced for any losses. Current Report January 31, 1995 Deposits with County: Pre-Petition $348.1 Million Post Petition 8.6 Million Bank of America Money Market 8.5 Million State of Calif. LAIF 7.5 Million Debt Service Res. wn-rustees 19.9 Million $392.6 Million The Committee offered suggestions for future report formats and will notify staff of other ideas they have. Mr. Streed reported that Standard & Poor's had lifted the negative rating of the Districts' retired Taxable Commercial Paper Program which would help to improve our credit on Wall Street. Moody's, however, required a formal action of the Board stating the Taxable Commercial Paper Program will not be re-initiated without future Board action and a replacement for the Standby Withdrawal Agreement with the County. With the Committee's agreement, such an item will be forwarded to the Executive Committee. A short-term line of credit proposed by Societe Generale, with an option to convert to long-term, was briefly presented. The Directors noted their desire not to reenter the short-term financial market, especially at the rates proposed. The proposal was tabled pending a pressing need. The Committee had expressed a desire for an informational session on Saturday to review the process and plans for financing and investing by the Districts. The Committee agreed to schedule Saturday, March 18, 1995, at 9:00 a.m. All Directors will be invited. (d) Report of the Director of Personnel Gary Hasenstab, Director of Personnel, distributed a staff report entitled, "Employee Turnover Analysis" prepared by his staff. The report indicated that turnover at the Districts is relatively low, averaging 6.6% over the past three years. Voluntary termination amounted to an average of 4.3%. The Committee was pleased that such analyses are performed and that the Districts are within the national range. Minutes of Finance & r rsonnel Committee Page 4 February 15, 1995 (5) APPROVAL OF MINUTES Director Dunlap referenced FPC item 95-05, "Internal Controls for Accounts Payable, Payroll and Treasury," included in the January 18, 1995 meeting minutes, and offered the City of Brea's comments on internal controls. Staff will respond at the next meeting. It was moved, seconded and carried to approve the draft minutes of the January 18, 1995, meeting of the Finance and Personnel Committee. (6) STAFF OVERVIEW OF DISTRICTS AND FINANCE AND PERSONNEL DEPARTMENTS FOCUSING ON COMMITTEE HANDBOOKS The Committee members were given a personal copy of the Directors' Handbook for Board Committees. Chairman Brown asked the Directors to review the handbook over the next month and to direct any question to staff. The Finance Director reported that Section H was specific to the Committee and that the Policies and Procedures Manual for the COP program was included. (7) CONSIDERATION OF OPERATIONS, MAINTENANCE AND TECHNICAL SERVICES COMMITTEE RECOMMENDATION OMTS95-011 The Districts' Wastewater Discharge Regulations provide for an Excess Capacity Charge, in an amount and method to be determined by the Boards of Directors on a case-by-case basis. In August 1994, the Joint Boards of Directors approved a policy whereby governmental agencies would be assessed these charges and directed staff to report on a specific approach for assessing the charge. Staff has been informed that there are several public agency projects that will have significant capacity demands on our system and developed an approach for assessing Excess Capacity Charges. The Operations, Maintenance and Technical Services (OMTS) Committee considered item OMTS95-011-"Consideration of motions to receive and file staff report re establishing procedures for assessing Excess Capacity Charges; and to direct staff to prepare a resolution establishing the Excess Capacity Charge Program," at their meeting on February 1, 1995. The OMTS Committee duly moved, seconded and approved staff's recommendation. The Planning, Design and Construction Committee reviewed the OMTS recommendation and the staff report at their meeting of February 2, 1995. The approach developed for assessing Excess Capacity Charges was reviewed for the Finance and Personnel Committee's information. It was moved, seconded and duly carried to receive and file OMTS95-011 . ) Minutes of Finance & Pe')>nnel Committee .., Page 5 February 15, 1995 (8) OLD BUSINESS FPC95-06 Consideration and Review of Short List for Selection of Districts' Independent Auditors and Establish a Selection Committee At the last Committee meeting, the Directors approved the release of the Request for Proposals (RFP) for Professional Auditing Services to prospective firms. The RFP was mailed on January 19, 1995, and five responses were received on February 10, 1995. The services to be provided include the audit of the Districts' financial statements for the fiscal year ending June 30, 1995, with the option to audit the Districts' financial statements for each of the three subsequent fiscal years. Prior to the February Committee meeting, the Director of Finance, the Controller ,and the Accounting Manager reviewed and ranked the proposals using the Evaluation Ranking Form. A short list of firms recommended by them, including Conrad & Associates, Moreland & Associates and Deloitte & Touche, was presented at the meeting. Director Dunlap presented the City of Brea's comments on the long list of firms to receive RFPs. The city staff was supportive of the long list and of the regional firms on the short list. Recommendation It was moved, seconded and carried to form a Selection Committee consisting of the Finance and Personnel Committee Chairman, the Director of Finance, and the Controller. On February 24, 1995, the Selection Committee is scheduled to interview the firms on the short list and prepare a recommendation to the Joint Boards. Vice Joint Chairman Swan asked the Selection Committee to report on the impact of the Financial Program of hiring a regional firm versus a "Big 6" firm. FPC95-09 Consideration of Certificates of Participation (COP) Information Sheet At the January 18, 1995, Finance and Personnel Committee meeting, Committee members reviewed the Quarterly COP Interest Rate Monitoring Report for the 1990-92 Capital Improvement Program. After receiving and discussing the report, Committee members requested staff to prepare a one-page information sheet on COPs. Minutes of Finance & r iSOnnel Committee Pages February 15, 1995 Steve Kozak, Financial Manager, presented an information sheet containing a general description of COPs and synthetic interest rates, and directed the Committee to a detailed and complete presentation in the Certificates of Participation (COP) Financing Program Policy and Procedures Manual included in the Directors' Committee Notebook. FPC95-12 Consideration of a Motion Recommending a Board Resolution Adopting the Provisions of Government Code Section 31641.04 Authorizing Two Years Additional Service Credit for Retirement Purposes Gary Hasenstab, Director of Personnel, presented a report adopting provisions of Government Code 31641.04, authorizing Districts employees to receive two years additional service credit for retirement purposes. The County Employees Retirement Law of 1937 allows the Districts' Boards to determine that it would be in the best economic interests of the Districts for employees who are otherwise eligible to retire to receive an additional service credit of two years as an incentive to retire within a specified period. Mr. Hasenstab further described the potential savings from an early retirement program and the steps needed for implementation. As a matter of policy, positions vacated through this process may be eliminated or left unfilled (attrition) for a specified period, thus increasing salary savings potential. Recommendation It was moved, seconded and carried to pass to the Executive Committee without comment staff reports and a Board Resolution adopting the provisions of Government Code Section 31641.04 authorizing Districts employees in the following classifications: Collection Facilities Field Supervisor, Facilities Manager and Foreman, to receive two years additional service credit for retirement purposes to be effective March 1, 1995 through April 30, 1995. FPC95-13 Status Report on Districts' Deferred Compensation Plan in Response to Director Swan's Request Finance Director Gary Streed reported that the Districts have an IRS-approved "unqualified" deferred compensation plan. All employees and Directors are eligible to participate in the plan. There are approximately 300 active participants in the plan. Deposits to an "unqualified" plan are legally the property of the Districts. Two options are provided for plan deposits: the County Commingled Investment Pool, and the Lincoln National Insurance Plans. Prior to the County's bankruptcy, 67% of the participants were making deposits to the Commingled Minutes of Finance & Pf"'~nnel Committee I Page 7 February 15, 1995 Investment Pool. Several employees have changed plans since December 6, 1994, and now 30% of the participants are in the Commingled Investment Pool. The Old Age, Survivors and Disability (OASDI) contributions of 7.5% for each Director are also deposited in the Commingled Investment Pool. Deductions from payrolls and Directors' compensation since December 6, 1994 have been held in the Districts' safe and not deposited into the Commingled Investment Pool. No interest earnings have been allocated or apportioned to the County Plan since June 30, 1994. Assuming that the Commingled Investment Pool has realized a 23% principal loss, the 457 Plan participants' deposits could be reduced by $1,073,336.40. Interest earnings since July 1, 1994 previously estimated to be $127,519.05 are now undetermined, and will be addressed later. The Committee considered several options for making the depositors "whole," including an immediate cash infusion, payments at retirement, establishing a new fund and establishing a reasonable "loss" for the year. The Committee asked that this matter be reconsidered when the status of the entire County Pool was resolved. (9) NEW BUSINESS FPC95-14 Consideration of Review of Remarketing Agents for Variable Rate Certificates of Participation Steve Kozak, Financial Manager, presented a written report that Merrill Lynch, remarketing agent for the Districts' 1990-92 Series "A," Series "C," and 1993 Refunding Certificates of Participation (COPs), resets the interest rates each day and remarkets these COPs. For the 1992 Refunding COPs, PaineWebber completes the process weekly. Mr. Kozak reported that within a few days of the County's bankruptcy filing, the Districts' daily COPs were trading as high as 255 basis points above the index. At year end, the Districts were paying 97 basis points above the index. During January, the difference has been as low as 29 basis points, but has increased to 92 basis points on February 7. One basis point is the equivalent of $10,000 per year on $100,000.00. During December and January, staff and PFM have discussed the recent market situation and remarketing performance with the remarketing agent. The remarketing agent has noted that investors are weary of any securities bearing the "Orange County" name, regardless of the credit worthiness of a particular · issuer, such as the Districts. The remarketing agent has suggested that additional time will be required for the market to accept "Orange County" paper and for interest rates to come down, and that an investor tour or a rating confirmation may help to speed the process. Other remarketing agents are currently producing lower interest rates on comparable borrowings. Minutes of Finance & · rsonnel Committee Page 8 February 15, 1995 Patti Gorczyca, Public Financial Management, gave an overhead presentation on the performance of the Districts' daily remarketing agent. She showed that outside of Orange County the daily rates for five remarketing agents are very close. Inside Orange County, however, Merrill Lynch has set the Districts' rates higher than the rates paid by other agencies with other remarketing agents. The difference in rates has decreased over the last month. Sam Corliss of Merrill Lynch answered questions from the Committee. He reported that Merrill Lynch remarkets almost all of the daily reset issues from Orange County. Because of this volume, Merrill Lynch must sell to corporate and money market funds, thus raising the rates paid. Mr. Corliss reaffirmed his firm's desire to expand the market pool and to provide the lowest possible rates. Recommendation After considerable discussion, the Committee voted to recommend to the Executive Committee and the Boards that the Finance and Personnel Committee be delegated the authority to replace the remarketing agent if they determine it necessary after monthly comparative monitoring and reporting by staff. FPC95-15 Consideration of Joint Works Budget Reviews Prepared by Staff for the Quarter Ended December 31, 1994 Gary G. Streed, Finance Director, presented written Joint Works Budget reviews for the quarter ended December 31, 1994, and summary statements of the Joint Works Operating Costs, the Joint Works Capital Improvement Program, and the costs of the workers' compensation, public liability and health plan self-insurance funds for the six months of fiscal year 1994-95. With one-half of the year gone, Mr. Streed advised that 45.9% of the net joint operating budget has been expended. Net costs are up $505,952 or 2.28%, compared with the same period last year. This is primarily due to salaries and wages, a decrease in labor charged to CORF projects, a change in the sulfide control program, the studies of Ernst & Young, and increased monitoring costs. Small increases and decreases in other categories make up the balance. At the same time, flows have increased 15.68%. Therefore, the increase in costs and total flows have resulted in a $24.07 per million gallons net decrease in the unit cost to treat and dispose of sewage, to $517.70 per million gallons. Joint Works construction projects for the first six months are lower than originally scheduled, running at 21 % of the 1994-95 budget or $14.0 million. We continue to receive excellent bids on new projects, reflecting the slow economy. Several projects have recently been awarded and progress payments on these projects will increase CORF outlay over the remainder of the year. ) Minutes of Finance & P~nnel Committee Page 9 February 15, 1995 The self-funded insurance program are operating within their budgets. Summary reports for the Joint Works and the individual Districts will be considered by the full Boards of Directors in March. (10) CLOSED SESSION None. (11) OTHER BUSINESS. IF ANY None. (12) MATTERS WHICH A DIRECTOR WOULD LIKE STAFF TO REPORT ON AT A SUBSEQUENT MEETING None. (13) MATTERS WHICH A DIRECTOR MAY WISH TO PLACE ON A FUTURE AGENDA FOR ACTION AND A STAFF REPORT None. (14) CONSIDERATION OF UPCOMING MEETING DATES AND ITEMS TO BE DISCUSSED AT THOSE MEETINGS Committee Chairman George Brown requested the Committee refer to the calendar of future meetings on the back of the Notice of Meeting and advised the next Finance and Personnel Committee Meeting is scheduled for Wednesday, March 15, 1995. He recommended the Committee review the list of future meeting topics. (15) ADJOURNMENT The meeting was adjourned at 7:50 p.m. GGS:lc J:\WPOOC\FIN\CRANE\FPCMTGIFPC95WllNUTESIMFPC2.95 STATE OF CALIFORNIA ) ) SS. COUNTY OF ORANGE ) Pursuant to California Government Code Section 54954.2, I hereby certify that the Notice and the Agenda for the Finance and Personnel Committee meeting held on February 15, 1995, was duly posted for public inspection in the main lobby of the Districts' offices on February 10, 1995. Posted: By: IN WITNESS WHEREOF, I have hereunto set my hand this 15th day of February, 1995. Penny Kyle, Secret of eae of the Boards of Directors of County Sanitation i ricts~ s. 1, 2, 3, 5, 6, 7, 11, 13 & 14 of Orange County, California J:\WPDOCIFINICRANE'\FPC.MTGIFPC95\CERTOF.POSICERTPCS2.95