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HomeMy WebLinkAbout1996-07-10FILED In the Office of the Seereta County Sanitation District(s No(s) /1/. fl County Sanitation Districts of Orange County, California P.O. Box 8127 • 10844 Ellis Avenue Fountain Valley, CA 92728-8127 Telephone: (714) 962-2411 DRAFT .. 24199r MINUTES OF FINANCE, ADMINISTRATION AND HUMAN RESOURCES COMMITTEE Wednesday, July 10, 1996, 5:30 P.M. A mf3eting of the Finance, Administration and Human Resources Committee of the County Sanitation Districts Nos. 1, 2, 3, 5, 6, 7, 11, 13 and 14 of Orange County, California was held on June 12, 1996 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, Chair John C. Cox, Jr., Joint Chair Jan Debay John M. Gullixson Wally Linn Thomas Saltarelli William G. Steiner Roger R. Stanton, Vice Chair Peer Swan, Vice Joint Chair Committee Directors Absent : Burnie Dunlap James Flora Other Directors Present: John Collins, PDC Chair Staff Present: Donald F. McIntyre, General Manager Judith A. Wilson, Assistant General Manager Ed Hodges, Director of General Services Admin. Bob Ooten, Director of Operations & Maintenance Mike Peterman, Director of Human Resources Gary Streed, Director of Finance Michelle Tuchman, Director of Communications Steve Kozak, Financial Manager Mike White, Controller Greg Mathews, Principal Administrative Analyst Linda Eisman, Training Manager Frankie Woodside, Assistant Committee Secretary Others Present: Tom Woodruff, General Counsel Nick Nichols, Labor Counsel Janet Houston, League of Cities (2) APPOINTMENT OF A CHAIR PRO TEM No appointment was necessary. (3) PUBLIC COMMENTS No comments were made. I Minutes of Finance, Adn .. ,' and Human Resources Committe Page 2 July 10, 1996 (4) REPORTS OF THE COMMITTEE CHAIR. GENERAL MANAGER, ASSISTANT GENERAL MANAGER(S), DIRECTOR OF FINANCE/TREASURER. DIRECTOR OF HUMAN RESOURCES, DIRECTOR OF GENERAL SERVlCES ADMINISTRATION, DIRECTOR OF COMMUNICATIONS AND GENERAL COUNSEL (a) Report of the Committee Chair The Chair introduced Frankie Woodside, who is Executive Assistant to Ed Hodges and the Committee's Assistant Secretary. Frankie was present to take the minutes of this evening's meeting. The Chair had no further report. (b) Report of the General Manager The General Manager had no report. (c) Report of Assistant General Manager -Administration The Assistant General Manager of Administration had no report. Report of Assistant General Manager -Operations The Assistant General Manager of Operations had no report. (d) Report of the Director of Finance/Treasurer Gary Streed reported that the daily COP rates traditionally go up at the end of the month and down at the beginning of the month. When this report was mailed, only the end of the month rates were available. The latest rates indicate they have gone down approximately 1. 7%. Mr. Streed also reported on the status of the preliminary negotiations with J.D. Edwards regarding the Financial Information System. (e) Report of the Director of Human Resources The Director of Human Resources had no report. (f) Report of the Director of General Services Administration The Director of General Services updated the Committee on the CNG project. In May, the low bidder on the project was Nova. Their costs were approximately $200,000 higher than our engineer's estimate. In June, Nova filed for bankruptcy and wanted out of their contract. The next apparent low bidder was approximately $300,000 higher than Nova. As a Minutes of Finance, Admin. and Human Resources Committee Page 3 July 10, 1996 result, staff is in the process of bringing this item back to the PDC Committee and recommending that the project be rebid. Staff is working with the Gas Company to bring project costs closer to the original engineer's estimate. Mr. Hodges also reported on discussions currently underway with potential users and advised that the National Renewal Energy Laboratory contacted the Districts with a plan to participate and invest $130,000 into the project. (g) Report of the D1rector of Communications The Director of Communications had no report. (g) Report of General Counsel General Counsel had no report. (5) APPROVAL OF MINUTES It was moved, seconded and duly carried to approve the draft minutes of the June 12, 1996, meeting of the Finance, Administration and Human Resources Committee. (Please Note: Though the following items may have been acted on in another sequence, the minutes will reflect them in numerical order for tracking purposes.) (6) OLD BUSINESS (7) FAHR96-40 Labor Negotiations -Information-Only. Mike Peterman, Director of Human Resources, reported that this item is an information-only item. Mike advised that under the "closed session" portion of the meeting, he will present draft labor proposals that have been developed by Division management and Department Heads and will review the selection of our negotiator. Mr. Peterman introduced Nick Nichols as the Districts' choice to represent the Districts with the Professional and Supervisory group. NEW BUSINESS FAHR96-41 Consideration of motion to receive and file Treasurer's Report for the month of May 1996. Mr. Streed advised that the Treasurer's report included in the agenda package indicated the cash and investment position at the end of May 1996. There has been a $1.5 million improvement in market value at the end of June. Minutes of Finance, Admin. and Human Resources Committee Page 4 July 10, 1996 Performance Monitoring Reports for Liquid and Long-term Operating Monies indicated that total investments continue to outperform the benchmarks. FAHR96-42 Consideration of motion to authorize the General Manager to enter into a contractual agreement with a commercial broker to lease 4 :!: acres of land located at Plant 1, and 30:!: acres of land located at Plant 2 for a period of up to 1 O years. . Ed Hodges, Director of General Services Administration, advised that the Districts are now at the point where vacant land can be considered for alternative revenue productive uses. In 1966 the City of Fountain Valley approached the Districts with a proposal to lease a portion of Plant 1 for a ten-year period to be used as their city yard. Boznanski and Company was retained to evaluate the market value and fair rental value of the parcels located at Plant 1 and Plant 2. Boznanski and Company's report concluded that the highest and best use of the vacant land would be as a storage yard, nursery, Christmas tree farm, etc. The report concludes that the anticipated yearly annual rental range for the Plant 1 property could be $6.80 to $7.25 per square foot and at Plant 2 could be $5.00 to $5.50 per square foot. This could result in an annual income of $327,000 to $539,000 not including any brokerage fee. Since the time of this evaluation, the City of Fountain Valley has made other arrangements, however, staff feels the land can still be leased for the uses noted above. After discussion on this item, a motion was made to: Authorize staff to prepare a "business opportunity solicitation" and mail to commercial real estate brokers; authorize staff to retain a real estate expert to evaluate the proposals; and directed staff to return to the appropriate Committee with an evaluation, including any costs involved in cleaning up the sites to make them leasable, and any environmental liability that may be involved. The Committee further recommended that staff contact the cities of Fountain Valley and Huntington Beach regarding authorized uses of the land that is to be leased. Commissions will be negotiated. FAHR96-43 Consf deration of motion authorizing the Human Resources Department to issue a Request for Proposal (RFP) for professional consultant services to conduct a study to determine the feasibility of broadbanding. Mike Peterman, Director of Human Resources, gave a report and slide presentation. He advised that the Districts' current classification structure has 146 separate job classifications. There is a different job title for every fourth employee. Management believes this specialization is contrary to the goals of a productive and flexible workforce. Mr. Peterman reviewed the broadbanding salary management system and how job families with up to twelve classifications can be reduced to two or three bands. Minutes of Finance, Admin. and Human Resources Committee Page 5 July 10, 1996 After discussion among the Committee members, it was moved, seconded and duly carried to authorize staff to issue a Request for Proposal (RFP) for professional consultant services to conduct a study to determine the feasibility of broadbanding, and that the consultant will meet with the Committee prior to doing any substantial work as well as presenting the results of the study to the Committee. FAHR96-44 Consideration of motion to adopt Resolution No. 96- amendinq Resolution No. 95-105 re the Districts' Alcohol and Controlled Substances Policy and Testing Program. Human Resources Director Mike Peterman passed out a copy of the County Sanitation Districts' Substance Abuse and Alcohol Misuse Plan. Mr. Peterman advised the Plan has been prepared to comply with the Department of Transportation Omnibus Transportation Employee Testing Act which requires every driver who operates a commercial motor vehicle in interstate or intrastate commerce, and is subject to commercial driver's license requirements, to be subject to an Anti-Drug and Alcohol Program. This program implements federal legislation. After discussion, it was moved, seconded and duly carried to recommend that the Joint Boards approve Resolution No. 96-_, amending Resolution No. 95-105. FAHR96-45 Consideration of motion approving Joint Powers Agreement Establishing the Orange County Council of Governments. Judy Wilson reported that Orange County Council of Governments (COG) was officially formed in June 1996 when the requisite number of cities approved the Joint Powers Agreement (JPA) establishing this organization. The JPA for the COG provides for an organization of 21 voting members. These include Orange County's 12 delegates to SCAG and one member each from organizations such as Orange County Division of the League of Cities; County of Orange; Orange County Transportation Authority; Independent Special Districts of Orange County/Water Agencies representative; Orange County Cities AQMD representative and County of Orange AQMD representative; an at-large Orange County City; and the County Sanitation Districts of Orange County. Also included are two non-voting members representing the private sector and the universities. Judy introduced Janet Houston of the League of Cities who reviewed some of the issues that would be brought before the COG and the processes that will be set up to review those issues. It's likely there will be amendments to the JPA after all the issues are discussed. The COG is not intended to be another layer of government. Rather, it was intended to replace the Orange County Regional Advisory and Planning Council (RAPC), which has existed since 1991. Minutes of Finance, Admin. and Human Resources Committee Page 6 July 10, 1996 There are no membership dues required. The COG will not require new staff and instead will tap into existing staff resources from member entities. The COG's expenses will be covered through funds made available to the Orange County subregion from SCAG. August 15th will be the first meeting of the COG. After discussion on this item it was moved, seconded and duly carried, with 5 aye votes and 2 nay votes, to recommend that the Joint Boards of Directors approve the Joint Powers Agreement establishing the Orange County Council of Governments. (8) CLOSED SESSION The Chair reported to the Committee the need for a closed session, as authorized by Government Code Sections 54957.6, to discuss and consider the items that are specified as Items (8)(b)(1) and (2) on the published Agenda. The Committee convened in Closed Session at 6:42 p.m. Confidential Minutes of the closed session held by the Committee have been prepared in accordance with California Government Code Section 54957.2 and are maintained by the Board Secretary in the Official Book of Confidential Minutes of Board and Committee Closed Meetings. A report of actions taken will be publicly reported at the time the approved action becomes final re Agenda Items 8(b)(1) and (2). At 7:30 p.m., the Committee reconvened in regular session. (9) OTHER BUSINESS. IF ANY None. (10) MATTERS WHICH A DIRECTOR WOULD LIKE STAFF TO REPORT ON AT A SUBSEQUENT MEETING No reports were requested. (11) MATTERS WHICH A DIRECTOR MAY WISH TO PLACE ON A FUTURE AGENDA FOR ACTION AND A STAFF REPORT None. (12) CONSIDERATION OF UPCOMING MEETING DATES AND ITEMS TO BE DISCUSSED AT THOSE MEETINGS The next Committee meeting is scheduled for Wednesday, September 11, 1996. ) Minutes of Finance, Admin. and Human Resources Committee Page 7 July 10, 1996 (13) ADJOURNMENT The meeting was adjourned at approximately 7:32 p.m. ~~ Lenora Crane Finance, Administration and Human Resources Committee Secretary J:\WPDOC\FIN\CRANE\FPC.MTG\FAHR.96\1996.MIN\MFAHR7.96 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, Administration and Human Resources meeting held on July 10, 1996, was duly posted for public inspection in the main lobby of the Districts' offices on July 3, 1996. Posted: By: IN WITNESS WHEREOF, I have hereunto set my hand this 10th day of July, 1996. Penny Kyle, Secreta Sanitation Districts County, California f ac the Boards of Directors of County 3, 5, 6, 7, 11, 13 & 14 of Orange .......,~...-.-.a::.____t3 ____ , 1996,~/P.M. ~~ J:IWPDOCIFINICRANEIFPC.MTGIFAHR.96\CERT.POS\CERTP07.96 phone: (714) 962-2411 mailing address: P.O. Box 8127 Fountain Valley, CA 92728-8127 street address: 10844 Ellis Avenue Fountain Valley, CA 92708-7018 Member Agencies • Cities Anaheim Brea Buena Park Cypress Fountain Valley Fullerton Huntington Beach Irvine La Habra La Palma Los Alamitos Newport Beach Orange Placentia Santa Ana Seal Beach Stanton Tustin Villa Park Yorba Linda County of Orange Sanitary Districts Costa Mesa Garden Grove Midway City Water Districts Irvine Ranch COUNTY \,)ANITATION DISTRICTS OF ORANGE COUNTY, CALIFORNIA July 3, 1996 NOTICE OF MEETING FINANCE, ADMINISTRATION AND HUMAN RESOURCES COMMITTEE COUNTY SANITATION DISTRICTS NOS. 1, 2, 3, 5, 6, 7, 11, 13 AND 14 OF ORANGE COUNTY, CALIFORNIA WEDNESDAY. JULY 10. 1996 -5:30 P.M. DISTRICTS' ADMINISTRATIVE OFFICES 10844 ELLIS AVENUE FOUNTAIN VALLEY, CALIFORNIA 92708 A regular meeting of the Finance, Administration and Human Resources 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. A Public Wastewater and Environmental Management Agency Committed to Protecting the Environment Since 1954 July 3, 1996 FINANCE. ADMINISTRATION AND HUMAN RESOURCES COMMITTEE TENTATIVELY SCHEDULED MEETING DATES Finance, Administration and Human Resources Committee Meetings Joint Board Meetings July July 10, 1996 July 24, 1996 August None Scheduled August 28, 1996 September September 11, 1996 September 25, 1996 October October 9, 1996 October 23, 1996 November None Scheduled November 20, 1996 December None Scheduled December 18, 1996 January January 8, 1997 January 22, 1997 February February 12, 1997 February 26, 1997 March March 12, 1997 March 26, 1997 April April 9, 1997 April 23, 1997 May May 14, 1997 May 28, 1997 June June 11, 1997 June 25, 1997 July July 9, 1997 July 23, 1997 CS DOC e P .0. Box 8127 e Fountain Valley, CA 92728-8127 e (714) 962-2411 ROLL CALL SHEET ~ I I FINANCE, ADMINISTRATION AND HUMAN RESOURCES COMMITTEE MEETING DATE: July 10, 1996 COMMITTEE MEMBERS GEORGE BROWN (Chair) ...................... . ROGER R. STANTON (Vice Chair) ............... . JAN DEBAY .................................. . BURNIE DUNLAP ............................. . JAMES H. FLORA ............................. . JOHN M. GULLIXSON ......................... . WALLY LINN ................................. . THOMAS SALTARELLI ......................... . WILLIAM G. STEINER ......................... . PEER A. SWAN (VJC) ......................... . JOHN C. COX, JR. (JC) ........................ . STAFF DON MCINTYRE, General Manager .............. . BLAKE ANDERSON, Asst. Gen'I. Mgr. -Ops. . ..... . JUDITH WILSON, Asst. Gen'I. Mgr. -Admin. . ...... . ED HODGES, Director of Gen'I. Srvs. Admin ........ . DAVID LUDWIN, Director of Engineering .......... . BOB OOTEN, Director of Operations & Maintenance .. MIKE PETERMAN, Director of Human Resources .... . GARY STREED, Director of Finance .............. . MICHELLE TUCHMAN, Director of Communications .. NANCY WHEATLEY, Director of Tech. Srvs ........ . STEVE KOZAK, Financial Manager ............... . MIKE WHITE, Controller ........................ . BRAD CAGLE, Principal Financial Analyst-Budget ... . GREG MATHEWS, Principal Administrative Analyst .. . LINDA EISMAN, Training Manager ............... . LENORA CP.ANE, Committee Secretary. . ......... . -----------............... . OTHERS TOM WOODRUFF, General Counsel ----------................ . .:.,._ _________ ................ . c: Penny Kyle L. Crane TIME: 5:30 P.M. ADJOURN: P.M. July 10, 1996 AGENDA FINANCE._ ADMINISTRA_TION AND HYMAN RESOURCES 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 WEDNESD'.AY, JULY 10. 1996 -5:·30 P.M. 1•·-~~~~~~-~~:~.~~~;;; ;~·;;;~;;:;;;;~;;;;;;c;~~~l;~;:;:···--····1: 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. 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 emergency item or that there is a need to take immediate action which need came to the attention of the Committee subsequent to the posting of the agenda, or as set forth on a supplemental agenda posted in the manner as above, not less than 72 hours prior to the meeting date . ....... ,.,.w .............................. , ......................... , .............................. v .......... -·-··---•-·· .............. _.,., ... ,_."""-•·· .. •• ........................ _ ................. I"' .................. • ........... -~ • ., .............. i" ............................ I"' .... • ( 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). July 10, 1996 (4) The Committee Chairman, General Manager, Assistant General Manager{s), Director of Finance/Treasurer, Director of Human Resources, Director of General Services Administration, Director of Communications, 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 Chair (b) Report of General Manager (c) Report of Assistant General Manager -Administration ( d) Report of Assistant General Manager -Operations ( e) Report of Director of Finance/Treasurer (f) Report of Director of Human Resources (g) Report of Director of General Services Administration (h) Report of Director of Communications (i) Report of General Counsel (5) Approval of draft Finance, Administration and Human Resources Committee Minutes for Meeting of June 12, 1996. (6) Old Business. FAHR96-40 Labor Negotiations -Information Only (Mike Peterman) (7) New Business. FAl:IR96-41 Consideration of motion to receive and file Treasurer's Report for the month of May 1996. (Gary Streed) FAHR96-42 Consideration of motion to authorize the General Manager to enter into a contractual agreement with a commercial broker to lease 4± acres of land located at Plant 1, and 30± acres of land located at Plant 2 for a period of up to 1 O years. (Ed Hodges) FAHR96-43 Consideration of motion authorizing the Human Resources Department to issue a Request for Proposal {RFP) for professional consultant services to conduct a study to determine the feasibility of broadbanding. (Mike Peterman) ,· l . July 10, 1996 FAHR96-44 Consideration of motion to adopt Resolution No. 96-_ amending Resolution No. 95-105 re the Districts' Alcohol and Controlled Substances Policy and Testing Program. (Mike Peterman) FAHR96-45 Consideration of motion approving Joint Powers Agreement Establishing the Orange County Council of Governments. (Judy Wilson) (8) Closed Session. If'" a • ., ........ _.· .. ,,.... • ................ •'1••·__,.-0, ••·•<f ·•·••1"• .. •···•·-••·••• .... •-.. -•.• .......... w.••••• ..... •--••-•-•---•LOO ............. -. ......... _.._ ........................ -•--•-••--•--,o.-•.••''•._·•• ,•••• j==·=.,· Closed Session: During the course of conducting the business set forth on this agenda as a regular meeting of the Committee, the Chair may convene the Committee in closed session to consider matters of pending real estate negotiations, pending or potential !, litigation, or personnel matters, pursuant to Government Code Sections 54956.8, 54956.9, 54957 or 54957.6, as noted. ~ Reports relating to (a) purchase and sale of real property; (b) matters of i 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. •···•• ......................................................... _..................... ..................... • ..... , ............................. ,.. ............................ .,. ................ , ............................ J .................. 1 (a) Convene in closed session. (b) (1) Confer with General Counsel re status of litigation: Louis Sangermano v. County Sanitation Districts of Orange County, California, Orange County Superior Court Case No. 732680 (Government Code Section 54956.9(a). (2) Confer with Districts' Negotiator re meet and confer; and negotiations for the establishment of salaries, compensation or fringe benefit. (Government Code Section 54957.6). (c) Reconvene in regular session. (d) Consideration of action, if any, on matters considered in closed session. (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. July 10, 1996 (13) Adjourn. ·1 --~:~y:~:~:::;:::::::~l::··::··:.:::·~~-=h··:·:l:=-~-~:-::·:~-:::n~~,.1 !::::· Administration and Human Resources Agenda, Committee members should contact the :=:.::. Committee Chair or Secretary ten days in advance of the Committee meeting. - Committee Chair: George Brown (310) 431-2185 ! Secretary: Lenora Crane (714) 962-2411, Ext. 2501 I i (714) 962-3954 (FAX) ~ 1 •11••······-··· .................. -.• ..,•••. ,••09·••.a•-1 •• .. ····• ................................................ , ·······--····-····-·· '••······ ....... , .................... _ •••••••••••• • Format • Written Report •overheads • Slldes • Flip Charts Originator __ _ C.rystreed Department Hud Sign on __ _ Garystreed Anticipated Time 6 min. FINANCE, ADMINISTRATION AND HUMAN RESOURCES COMMITTEE AGENDA FOR JULY 10, 1996 (4)(e): Director of Finance Report Summary Since June 1995, the daily rate COP program remarketing agents have been PaineWebber for the Series "A" and the 1993 Refunding COPs, and J.P. Morgan for the Series "C" COPs. Most fixed rate Series "B" COPs have been refunded and the 1992 Refunding COPs have always been remarketed by PaineWebber in a weekly mode. The attached graphs show the variable interest rates on each of the daily rate COPs since the last report, and the effective fixed rate for the two refunding issues which are covered by an interest rate exchange agreement commonly called a "swap." Variable rates historically rise at the end of each calendar quarter, and especially at year-end, because of business taxes and statements. The rates decline to prior levels immediately in the following month, as they did again this year. Staff will maintain our continuous rate monitoring and ongoing dialog with the remarket!ng agents and rating agencies to keep the Committee fully informed about developments in the program as they occur and at each meeting. Staff Recommendation Information only. J:IWPOOC\FINICRANE\FPC.MTGIFAHR.96'COVERS.96\DOF7.96 () .,, ii; C iil "C < )> RATE(%) DI ZS -I iil m a. ::ti • 0 .-N w .I>,. (11 0) C'" -I 0 0 0 0 0 0 0 '< m 0 0 0 0 0 0 0 "Tl :I: 03-J, .... I I 1 I I I I I 5· en I I DI I I I I :, -I 0 (I) 10-Jan-96 I I I I _CD 0) I I I 0 ~ ~ 17-Jan-96 1 I I N I I i I .. .- (0 (0 _a> 24-Jan-96 l ! I ~~ ~ I ~ is:, (0 I I I I ""' I I ! I 31-Jan-96 07-Feb-96 t7 14-Feb-96 .,, ~f I 21-Feb-96 (D ~ 28-Feb-96 I I I 1/ I ' n I ~ I I 06-Mar-96 I I I 0 I I I I "-= • I \ I I I I I I I ~ 13-Mar-96 I I I I c.... I ~ I I :-0 I I I I I I 1-3 s:: I ' I 0 20-Mar-96 I I I ~ ca I I I I DI I I I I = :, I I I I 27-Mar-96 I I I I ""'"I I I I I 00. + I I I 1-3 03-Apr-96 I I I 0 I I I I I I I ~ • I I I I 15 10-Apr-96 I I I I (J) I I I I :E I I I I ~ DI I I I I "C 17-Apr-96 I I I I I I I "-= I I I I + I I I I 0 I I I I 24-Apr-96 I I I I ~ I I I 1-3 (J) I I I 0 0 01-May-96 G) (D :, (J) .!J 08-May-96 15-May-96 22-May-96 29-May-96 05-Jun-96 12-Jun-96 19-Jun-96 26-Jun-96 t I ' ' ' FINANCE, ADMINISTRATION AND HUMAN RESOURCES COMMITTEE AGENDA FOR JULY 10, 199~ ( 5): Consideration of motion to approve the draft Finance, Administration and Human Resources Committee Meeting Minutes of June 12, 1996. Summary Attached is a draft of the Finance, Administration and Human Resources Committee meeting Minutes of June 12, 1996, for approval by the Committee. Staff Recommendation It is recommended that the minutes of the June 12, 1996, Finance, Administration and Human Resources Committee meeting be approved. These minutes were submitted to the Joint Boards at their June 26, 1996 meeting, and no further action is required. J:IWPDOC\FINICRANE\FPC.MTGIFAHR.96\1996.MINICVRMIN6.96 DRAFT MINUTES OF FINANCE, County Sanitation Districts of Orange County, California P.O. Box 8127 • 10844 Ellis Avenue Fountain Valley, CA 92728-8127 Telephone: (714) 962-2411 ADMINISTRATION AND HUMAN RESOURCES COMMITTEE Wednesday, June 12, 1996, 5:30 P.M. A meeting of the Finance, Administration and Human Resources Committee of the County Sanitation Districts Nos. 1, 2, 3, 5, 6, 7, 11, 13 and 14 of Orange County, California was held on June 12, 1996 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, Chair John C. Cox, Jr., Joint Chair Jan Debay Burnie Dunlap Thomas Saltarelli William G. Steiner Wally Linn Committee Directors Absent : James Flora John M. Gullixson Roger R. Stanton, Vice Chair Peer Swan, Vice Joint Chair Others Present Staff Present: Donald F. McIntyre, General Manager Judith A. Wilson, Assistant General Manager Ed Hodges, Director of General Services Admin. David Ludwin, Director of Engineering Bob Ooten, Director of Operations & Maintenance Mike Peterman, Director of Human Resources Michelle Tuchman, Director of Communications Mahin Talebi, Source Control Manager Steve Kozak, Financial Manager Mike White, Controller Linda Eisman, Training Manager Brad Cagle, Principal Financial Analyst-Budget Lenora Crane, Committee Secretary Others Present: Tom Woodruff, General Counsel None Dennis Vlasich, Kerry Consulting Group Don McLean, Robert F. Driver Co. (2) APPOINTMENT OF A CHAIR PRO TEM No appointment was necessary. (3) PUBLIC COMMENTS No comments were made. Minutes of Finance, Ad, L and Human Resources Committ1.. Page2 June 12, 1996 (4) REPORTS OF THE COMMITTEE CHAIR, GENERAL MANAGER. ASSISTANT GENERAL MANAGER(S), DIRECTOR OF FINANCE/TREASURER. DIRECTOR OF HUMAN RESOURCES, DIRECTOR OF GENERAL SERVICES ADMINISTRATION, DIRECTOR OF COMMUNICATIONS AND GENERAL COUNSEL (a) Report of the Committee Chair The Committee Chair had no report. (b) Report of the General Manager Don McIntyre briefly reported to the Committee on several important items: • This week all of the Districts' bargaining units have agreed to the health plan which had been approved by the Joint Boards at their last meeting. • Director John Collins underwent back surgery today, and has come through the operation successfully. He will be discharged from the hospital tomorrow. • SAWPA' s board has approved our agreement and will now move on to five agencies for their individual ratification. • A paragraph will be added to the letter to the Board scheduled to come out next week regarding the Districts' involvement in the Balsa Chica beach closure issue. (c) Report of Assistant General Manager -Administration The Assistant General Manager of Administration Judy Wilson announced two personnel changes: • Mike Peterman has been permanently appointed the Districts' Personnel Director, effective last Friday, June 7, 1996. Mike competed in a very strong pool of candidates and did very well. • The resignation of Steve Hovey, Information Technology Manager, has been accepted by the Districts. We will be recruiting to fill that vacant position. Judy further reported that Linda Eisman, Training Manager, has just completed and distributed the Districts' first annual Training Calendar. Linda Eisman advised that she is working with the Safety Program Minutes of Finance, Admin. and Human Resources Committee Page 3 June 12, 1996 Manager to define safety requirements. Some of the dates for those training sessions will be added to the calendar later and redistributed. Report of Assistant General Manager -Operations The Assistant General Manager of Operations had no report. (d) Report of the Director of Finance/Treasurer (e) (f) The Director of Finance!Treasurer's written report was contained in the agenda package. Steve Kozak, Financial Manager, reviewed the report for the Committee. He indicated that at the time our report was prepared, the variable rates were traded at 4. 7%, which was at end of the month. Today we were down between 3.10% and 3.15%. Report of the Director of Human Resources The Director of Human Resources had no report. Report of the Director of General Services Administration The Director of General Services Administration had no report. (g) Report of the Director of Communications Michelle Tuchman, Director of Communications, reported that tomorrow evening the first public participation meeting will be held regarding the Districts' Strategic Plan. Staff has sent out over 1,300 invitations, the press has been notified and Public Notices have been placed in the Register, Times and Orange County Business Journal. The meeting will be held in the Multi-Purpose Room at McGarvin Middle School, on Thursday, June 13, 1996, between 5:00 p.m. and 7:00 p.m. Approximately 150 people are expected to attend. (g) Report of General Counsel General Counsel Tom Woodruff reported on the Pringle Bill consolidation effort. There is a good chance that sanitation will not be part of the bill. Mr. Woodruff also updated the Committee on recent meetings by water agencies and the outcome of those meetings. Changes and specific amendments are being proposed to AB2109. The next hearing on the bill is set for July 3 before the Local Government Committee. ) Minutes of Finance, Admin. and Human Resources Committee Page4 June 12, 1996 (5) APPROVAL OF MINUTES It was moved, seconded and duly carried to approve the draft minutes of the May 8, 1996, meeting of the Finance, Administration and Human Resources Committee. (Please Note: Though the following items may have been acted on in another sequence, the minutes will reflect them in numerical order for tracking purposes.) (6) OLD BUS·INESS (7) FAHR96-29 Consideration of motion to approve renewal of the Districts' All-Risk Property Insurance Program for 1996-97, including earthquake. flood, personal property and business interruption coverage with: a $200 million All-Risk limit; a $30 million earthquake sub-limit. with deductibles of $25,000 for all perils except earthquake, and 5% per unit ($250,000 min.) for earthquake, for a total premium not to exceed $1.4 million. Steve Kozak, Financial Manager, noted that this item was originally presented to the Committee on May 8, 1996. A status report and additional information requested by the Committee is being presented tonight. Mr. Kozak introduced Don McClean of Robert F. Driver Company, the Districts' current Broker-of- Record. Mr. Kozak reviewed Mr. McClean's aggressive marketing efforts to obtain All-Risk Insurance at the not-to-exceed $1.4 million premium cost authorized at the last meeting. Mr. Kozak reviewed the 1995-96 Schedule of Insurance Companies, Premiums, Commissions and Fees. Premium reductions will be about 9.5%. Mr. Kozak noted that additional confirmations are expected over the next few days, and insurance is expected to be in place for the next fiscal year. It was moved, seconded, and duly carried to approve staffs recommendation. NEW BUSINESS FAHR96-35 Consideration of motion to receive and file Treasurer's Report for the month of April 1996. The month ended April 1996 Performance Monitoring Reports for Liquid and Long-term Operating Monies indicated that total investments amount to $386,761,323. Minutes of Finance, Admin. and Human Resources Committee Page 5 June 12, 1996 Steve Kozak reported that in addition to the above information presented each month, the Districts has gone on-line with Mellon Trust, our custodial services bank for our investment program. We are now able to present the Committee with actual portfolio consolidation statements without delay. The Committee will also receive the historical cost of the portfolio and the market value from both PIMCO, our investment manager, and Mellon Trust. Variations will occur at the close of the month due to pending trades, slightly different methodologies and evaluation methods. FAHR96-36 Consideration of motion recommending approval of the proposed 1996-97 Joint Works Budgets and forwarding them to the Joint Boards as follows: Joint Works Operating/Working Capital Worker's Compensation Self-Insurance Public Liability Self-Insurance Joint Works Capital Outlay Revolving $48, 700,000 275,000 385,000 44,895,000 This item was reported on by both General Manager Don McIntyre and Controller Mike White, with both utilizing a computerized slide system for their visual presentations. Mr. McIntyre advised that the proposed budget has been presented to the PDC and OMTS Committees. If the 1996-97 proposed budget is approved by the FAHR Committee, the entire budget, including the individual Districts, will be forwarded to the Joint Boards for consideration at their June 26, 1996 meeting. Don McIntyre gave an overview of the proposed 1996-97 budget and identified two major changes in the Districts' organizational charting. Mr. McIntyre reviewed the proposed actions to reduce costs, such as cross-training, retraining for reassignments, attrition, early retirement incentives, etc. All vacant positions have been eliminated from the budget. Staffing is maximized at 624 for next year, and costs per MGD are expected to remain at $555. Mr. McIntyre further reported on the Districts' proposed actions to become more competitive, the Districts' critical goals, and reviewed budget charts identifying expected areas where money will be expended and where the revenue is to be derived. Mr. McIntyre advised that fees may have to be increased next year. Controller Mike White then gave an in-depth report of the Districts' 1996-97 Proposed Budget, going through each of the ten major sections of the budget and identifying new areas added to this year's budget. The Committee suggested that the various "reserves" be renamed or identified as earmarked for specific projects when next year's budget is prepared. It was also noted that a budget should be used as a guide. It does not necessarily have to be totally expended and, on the other hand, if it is not enough, staff should not be reluctant to come back with reasons why it should be increased. Minutes of Finance, Admin. and Human Resources Committee Page6 June 12, 1996 The Chair suggested that those Committee members who have questions regarding specific areas in the budget contact staff directly. The Committee complimented staff for the excellent job they did preparing this year's proposed budget. After discussion on this item, it was moved, seconded and duly carried to recommend that the Joint Boards of Directors approve the proposed Joint Works Operating, Joint Works Capital and Self-Insurance Fund Budgets for 1996-97. FAHR96-37 Consideration of motion to receive and file staff report regarding current commission-based compensation structure for Districts' Broker of Record. Steve Kozak stated that this item was first presented to the Committee at its May 8, 1996 meeting, and has been brought back this month with additional information. Mr. Kozak reviewed the annual compensation received by Driver Associates for each fiscal year since 1992-93. Mr. Kozak introduced Don McClean of Robert F. Driver Associates who described the current insurance market, and answered questions from the Committee regarding his company's commission structure. Mr. McClean advised that his company has two offices, and the staff that handled the Districts' health benefits package is not as efficient as his office which handles property and all-risk insurance. Mr. McClean made it clear that his company is more concerned about their reputation and providing continued services than about generating moderate increases in their premium income. As reported to the Committee in May, Mr. Kozak advised that staff is preparing a Request for Proposals (RFP) for insurance broker services. The RFP is being configured to allow firms to propose to provide services for liability, property, casual & miscellaneous insurance, and/or employee health insurance. The RFP will request firms to provide compensation proposals under both commission and flat fee structures. After discussion among the Committee members, it was moved, seconded and duly carried to receive and file this report. FAHR96-38 ConsideraUon of motion to accept the proposal submitted by J.O. Edwardsi authorize staff to enter into negotiations with J.D. Edwards for a new financial information system: and to present a negotiated agreement, in an amount not to exceed $1,525.000. to the Joint Boards for approval at the July 24. 1996 meeting. Minutes of Finance, Admin. and Human Resources Committee Page 7 June 12, 1996 Mr. White introduced Dennis Vlasich of Kerry Consulting Group, the company selected to complete Phase Ill, Selection Process for the Finance Information System Hardware and Software; and Phase IV, Implementation and Acceptance qf the Selected Hardware and Software Solutions. This item will complete Phase Ill in the FIS process. Mr. Vlasich gave a slide presentation of the process followed in acquiring the financial information system. He reviewed the lengthy RFP process which included two RFP releases, and the evaluation process. J.D. Edwards demonstrated all of the required computer module applications and was unanimously recommended by the evaluation team. Although J. D. Edwards was the second lowest priced vendor, they ranked number one when evaluating the three firms based on a price per functionality point system. J. D. Edwards is the most responsible vendor, has the most credible proposal and gave the best demonstration. After discussion, it was moved, seconded and duly carried to approve staff's recommendation. FAHR96-39 Consideration of motion to modify the Professional Services Agreement with Kerry Consulting Group to an amount not to exceed $47,757 for services rendered in performing Phase IV of the FIS project. an increase of $23,567, to provide for financial and human resources process and procedure reengineering oversight not originally included in the scope of work. Mike White stated that Kerry Consulting Group is the company selected to complete Phases Ill and IV of the Financial Information System project. Phase Ill was the vendor selection process, which has just been concluded. Kerry Consulting will be working on Phase IV of the FIS project which is the implementation process. Recent site visits to review software installations revealed an opportunity to save significant staff costs in the future by reengineering the financial and human resource processes currently in place. Mr. White advised a change order in the amount of $23,567 to Phase IV of the Kerry Consulting Group contract is requested to accomplish this work. It was moved, seconded and duly carried to approve staff's recommendation. FAHR96-40 Labor Negotiations -Information Only Mike Peterman, Director of Human Resources, reported on the status of the Request for Information and Qualifications (RFIQ) for a labor negotiator. He advised that bids were solicited from five firms with two firms responding by the Minutes of Finance, Admin. and Human Resources Committee Page 8 June 12, 1996 deadline (William Hamilton and Associates, and Liebert, Cassidy & Frierson). A third bid was received from William Avery after the close of bids. The selection process will take place on July 1, 1996, with the selection committee comprised of Don McIntyre, Ed Hodges, Bob Ooten, Michelle Tuchman and Mike Peterman. Mr. Peterman advised that labor contract proposals will be presented at the July FAHR Committee meeting in closed session. After discussion on this item, it was moved, seconded and duly carried to authorize staff to rebid this RFIQ with a five-day time frame for firms to resubmit bids. (8) CLOSED SESSION The Chair reported to the Committee the need for a closed session, as authorized by Government Code Sections 54957.6, to discuss and consider the items that are specified as Item (8)(b)(1 )(a), (2) and (3) on the published Agenda. The Committee convened in Closed Session at 8:00 p.m. Confidential Minutes of the closed session held by the Committee have been prepared in accordance with California Government Code Section 54957.2 and are maintained by the Board Secretary in the Official Book of Confidential Minutes of Board and Committee Closed Meetings. A report of actions taken will be publicly reported at the time the approved action becomes final re Agenda Item 8(b)(3). No action was taken re Agenda Item 8(b)(2). At 8:20 p.m., the Committee reconvened in regular session. It was moved, seconded and duly carried to approve the agreement reached among the General Manager and Director of Human Resources and all employee organizations, in accordance with the prior authority approved by the Boards of Directors. (9) OTHER BUSINESS. IF ANY None. (10) MATTERS WHICH A DIRECTOR WOULD LIKE STAFF TO REPORT ON AT A SUBSEQUENT MEETING No. reports were requested. (11) MATTERS WHICH A DIRECTOR MAY WISH TO PLACE ON A FUTURE AGENDA FOR ACTION AND A STAFF REPORT None. Minutes of Finance, Admin. and Human Resources Committee Page 9 June 12, 1996 (12) CONSIDERATION OF UPCOMING MEETING DATES AND ITEMS TO BE DISCUSSED AT THOSE MEETINGS The next Committee meeting is scheduled for Wednesday, July 10, 1 ~96. (13) ADJOURNMENT The meeting was adjourned at approximately 8:22 p.m. @#¥-~ Lenora Crane Finance, Administration and Human Resources Committee Secretary J:\WPDOC\FIN\CRANE\FPC.MTG\FAHR.96\1996.MINIMFAHRS.96 Format • Written Report • Overheads D Slides D Flip Charts Originator ~ Department Head Sign Off_....:....c....;-'--- Anticipated Time 3o l'\1/,Y FINANC_E, ADMINISTRATION AND HUMAN RESOURCES COMMITTEE AGENDA FOR JULY 10, 1996 FAHR96-40: Labor Negotiations -Information Only Summary Through the end of our labor contract period that ends with Local 501 and OCEA in November and the Professional and Supervisory Groups in January, staff will provide the FAHR Committee with monthly updates on the negotiation progress. Staff will be selecting the labor negotiator prior to the Committee meeting on July 10. He or she will be in attendance at the meeting to go over the proposed time schedule and approach to this year's negotiations. Draft labor proposals have been prepared with the input of the Districts' management team and will be discussed in closed session with the contract negotiator. Staff Recommendation No recommendation -information only. A:\LABORNEG.FAH 1 ' Format • Written Report •Overheads •Slides • Flip Charts Originat~r Department Head Sign 8 Ga eed Anticipated Time 5 min. FINANCE, ADMINISTRATION AND HUMAN RESOURCES COMMITTEE AGENDA FOR JULY 10, 1996 FAHR96-41: Consideration of motion to receive and file Treasurer's Report for the month of May 1996. Summary Both Pacific Investment Management Co., PIMCO, and Mellon Trust began their professional external management of our funds in September 1995. In order to give the Directors an opportunity to review the month-end reports available from PIMCO, and to avoid distribution at the meeting, reports from the prior month are included with the agenda. Quarterly presentations are made to the Committee by PIMCO and our third-party independent consultant, Callan Associates. The Investment Policy adopted by the Joint Boards on May 24, 1995, includes reporting requirements as listed down the left most column of the PIMCO Monthly Report for the "Liquid Operating Monies" and for the "Long-Term Operating Monies." All of the Investment Policy requirements are being complied with and performance to date exceeds the index rates. Historical cost and the current market values, "mark-to-market," are shown as estimated by both PIMCO and Mellon Trust. The slight differences are caused by differing assumptions regarding marketability at the estimate date. Attached are schedules showing the detail and summary for both the short-term and long-term portfolio investments. State of Calif. LAIF Bank of America PIMCO -Short-term Portfolio PIMCO -Long-term Portfolio District 11 GO Bond Fund Debt Service Reserves @ Trustees Staff Recommendation Staff recommends the Committee receive, approve and forward this report to the Joint Boards. J:\WPOOC\FINICRANE\FPC.MTGIFAHR.96\COVERS.96\FAHR96.41 July 10, 1996 400 350 300 I! .!!250 0 C 'S200 • C ~150 i 100 50 0 CSDOC TOTAL CASH & INVESTMENTS 1995 -1996 June 30 July 31 Aug. 31 Sept 30 Oct 30 Nov. 30 Dec. 31 Jan. 31 Feb. 29 Mar. 31 Apr. 30 May 31 J:IWPOOC\FINICRANE\FPC.MTGIFAHR.96\COVERS.96\FAHR96,41 MONTHLY REPORT COUNTY SANITATION DISTRICTS OF ORANGE COUNTY INVESTMENT MANAGEMENT PROGRAM PIMCO'S PERFORMANCE MONITORING & REPORTING (for the month ending May 31, 1996) Long Term Operating Monies 14.1.1 PORTFOLIO COST AND MARKET VALUE Current Market Value Estimate: • PIMCO • Mellon Historical Cost: 14.1.2 MODIFIED DURATION Of Portfolio: Of Index: 14.1.3 1 % INTEREST RATE CHANGE Dollar Impact (gain/loss) of 1% Change: 14.1.4 REVERSE REPOS % of Portfolio in Reverse Repos: (see attached schedule) 14.1.5 PORTFOLIO MATURITY % of Portfolio Maturing within 90 days: 14.1.6 PORTFOLIO QUALITY Average Portfolio Credit Quality: 14.1.7 SECURITIES BELOW "A" RATING % of Portfolio Below "A": 14.1.8 INVESTMENT POLICY COMPLIANCE "In Compliance" 14.1.9 PORTFOLIO PERFORMANCE Portfolio Total Rate of Return: 1 Month: 3 Months: 12 Months: Year-to-Date: Index Total Rate of Return: 1 Month: C;\OFFIC:E\WPWIN\WPDOCs\PIMCORP'l\!.TMAY.Wl'D $279,087,873 $279,499,989 $284,390,406 _/ 2.54 2.40 $7,088,832 (2.54%) 0% NA AAA 0% ~ -.02 -.73 ------ -.59 -.07 MONTHLY REPORT COUNTY SANITATION DISTRICTS OF ORANGE COUNTY INVESTMENT MANAGEMENT PROGRAM PIMCO'S PERFORMANCE MONITORING & REPORTING (for the month ending May 31, 1996) Liquid Operating Monies 14.1.1 PORTFOLIO COST AND MARKET VALUE Current Market Value Estimate: • PIMCO • Mellon Historical Cost: 14.1.2 MODIFIED DURATION Of Portfolio: Of Index: 14.1.3 1 % INTEREST RATE CHANGE Dollar Impact (gain/loss) of 1 % Change: 14.1.4 REVERSE REPOS % of Portfolio in Reverse Repos: ( see attached schedule) 14.1.5 PORTFOLIO MATURITY % of Portfolio Maturing within 90 days: 14.1.6 PORTFOLIO QUALITY Average Portfolio Credit Quality: 14.1.7 SECURITIES BELOW "A" RATING % of Portfolio Below "A": 14.1.8 INVESTMENT POLICY COMPLIANCE "In Compliance" 14.1.9 PORTFOLIO PERFORMANCE Portfolio Total Rate of Return: 1 Month: 3 Months: 12 Months: Year-to-Date: Index Total Rate of Return: 1 Month: C:\OFFICEIWPWIMWPDOCSIJ'IMCORPT\LQDMAY.WPD $52,379,587 $52,421,205 $52,465,922 ,,- .14 .25 $73,331 (.14%) 0% 100% AAA 0% ' I -~ .45 1.34 ------ 2.23 .43 OCSG000l00 CSDOC-CONSOLIDATED MELLON TRUST PORTFOLIO SUMMARY BY SECTOR 31-MAY-1996 BASE: USD HBll00 % OF UNREALIZED ESTIMATED CURR PORTFOLIO DISTRIBUTION COST MARKET VALUE TOTAL GAIN/LOSS ANNUAL INCOME YIELD :ASH & CASH EQUIVALENTS CASH COMMERCIAL PAPER -DISCOUNT FEDERAL HOME LOAN MORTGAGE -LE FED LAND BANK -LESS THN lYR FNMA ISSUES -LESS THN lYR FED HM LOAN BNK -LESS THN lYR FEDERAL FARM CREDIT BANK -LES BSDT RESERVE DEPOSIT ACCOUNTS CANADIAN GOVERNMENT SHORT TERM TOTAL CASH & CASH EQUIVALENTS ~IXED INCOME SECURITIES U.S. GOVERNMENTS U.S. AGENCIES BANKING & FINANCE INDUSTRIAL TOTAL FIXED INCOME SECURITIES )THER PORTFOLIO ASSETS PAYABLES/RECEIVABLES 0.78 27,276,311.13 3,286,176.67 3,293,339.50 11,633,231.00 8,577,874.09 6,939,800.00 290,264.00 2,579,269.31 63,876,266.48 91,326,196.85 134,518,625.00 29,677,836.61 14,061,150.00 269,583,808.46 3,400,240.91 0.78 27,276,311.13 3,286,176.67 3,293,339.50 11,633,231.00 8,577,874.09 6,939,800.00 290,264.00 2,579,269.31 63,876,266.48 89,404,720.00 131,990,062.00 29,561,154.70 13,688,750.00 264,644,686.70 3,400,240.91 0.00% 8.22% 0.99% 0.99\ 3.50\ 2.58\ 2.09% 0.09% 0.78% 19.24% 26.94\ 39.77% 8.91% 4.12% 79.73% 1.02% 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 -1,921,476.85 -2,528,563.00 -116, 681. 91 -372,400.00 -4,939,121.76 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 10,884.90 0.00 10,884.90 6,126,875.00 8,700,040.00 2,085,397.00 1,202,250.00 18,114,562.00 0.00 0.00 0.00 0.00 0 .00 0.00 0.00 0.00 3.75 0 .00 0.02 6.85 6.59 7.05 8.78 6.84 0.00 TOTAL OTHER PORTFOLIO ASSETS 3,400,240.91 3,400,240.91 1.02\ 0.00 0.00 0.00 ==~=========~~===~ ~~=========r==== NET PORTFOLIO ASSETS 336,860,315.85 331,921,194.09 100.00% -4,939,1:21.76 18,125,446.90 5.46 Page 1 _) OCSGOOOlOU ~SDOC-CONSOLIDATED SHARES/PAR SECURITY DESCRIPTION ~ASH & CASH EQUIVALENTS CASH 0 CASH SUBTOTAL CASH COMMERCIAL PAPER -DISCOUNT 500,000 AMERICAN TEL & TL DISC 08/16/1996 1,800,000 AMERICAN TEL & TL DISC 08/09/1996 5,800,000 AMERICAN TEL & TL DISC 08/22/1996 5,000,000 AMERITECH CORP DISC 06/20/1996 900,000 AMOCO CO DISC 06/13/1996 1,200,000 CANADIAN WHEAT BD DISC 07/10/1996 1,100,000 CANADIAN WHEAT BD DISC 08/09/1996 300,000 COCA COLA CO DISC 06/07/1996 2,100,000 COMWLTH BK AUST A DISC 08/20/1996 300,000 ELEC FRANCE SVC DISC 08/23/1996 700,000 FORD MTR CR CO DISC 06/26/1996 1,700,000 FORD MTR CR CO DISC 08/29/1996 900,000 GENERAL ELEC CAP DISC 07/02/1996 1,300,000 GENERAL ELEC CAP DISC 08/06/1996 1,100,000 HEWLITT PACKARD DISC 08/20/1996 600,000 KFW INTL FIN INC DISC 08/06/1996 MELLON TRUST PORTFOLIO DETAIL BY SECTOR 31-MAY-1996 MARKET PRICE 1.000 98.775 98.469 98.656 97.355 98.983 98.640 98.633 99.898 98.653 98 .668 98.644 98.580 99.514 98.336 98.673 98.601 \-OF MARKET VALUE TOTAL 0.78 0.00 0.78 0.00 493,875.00 0.15 1,772,437.50 0.53 5,722,035.11 1.72 4,867,769.44 1.47 890,847.50 0.27 1,183,685.33 0,36 1,084,967.59 0.33 299,693 .17 0.09 2,071,717.67 0.62 296,003 .58 0.09 690,506.25 0.21 1,675,860.48 0.50 895,627.50 0.27 1,278,373 .06 0.39 1,085,402.08 0.33 591,608.34 0.18 Page 1.1 COST 0.78 0.78 493,875.00 1,772,437.50 5,722,035.11 4,867,769.44 890,847.50 1,183,685.33 1,084,967.59 299,693 .17 2,071,717.67 296,003.58 690,506.25 l,675,86t.48 895,627.50 1,278,373.06 l,085,'.102.08 591,608.34 UNREALIZED GAIN/LOSS 0 .00 0.00 0 .00 0 .00 0.00 o.oo 0 .00 0.00 0.00 0 .00 0 .00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 BASE: USO HBllOO ESTIMATED CUR ANNUAL INCOME YLD 0.00 0.0 0.00 0.0 0.00 0.0 0.00 0 0.00 0.0 0.00 0.0 0.00 0.0 0.00 0.0 0.00 0.0 0.00 0.0 0 .00 0 .0 0.00 0 .0 0.00 O.v 0.00 0 .0 0.00 0 .0 0.00 0 .0 0.00 0 .0 0.00 0 .0 OCSG000l00 CSDOC-CONSOLIDATED SHARES/PAR SECURITY DESCRIPTION MELLON TRUST PORTFOLIO DETAIL BY SECTOR 31-MAY-1996 MARKET PRICE %-OF MARKET VALUE TOTAL COST BASE: USO HBll00 UNREALIZED ESTIMATED CUR GAIN/LOSS ANNUAL INCOME YLD ---------------------------------------------------------------------------------------------~------------------------------------ 500,000 PITNEY BOWES CC DISC 99.027 06/14/1996 500,000 PITNEY BOWES CC DISC 98.990 07/23/1996 1,000,000 PITNEY BOWES CC DISC 98.787 07/22/1996 400,000 SHELL OIL SER A DISC 99.487 06/06/1996 SUBTOTAL COMMERCIAL PAPER -DISCOUNT FEDERAL HOME LOAN MORTGAGE -LESS THAN 1 YR 3,300,000 FED HOME LN MTG CORP DISC NTS MAT 06/28/1996 99.581 SUBTOTAL FEDERAL HOME LOAN MORTGAGE FED LAND BANK -LESS THN lYR 3,300,000 FED FARM CR BK CONS DISC NTS MAT 06/13/1996 99.798 SUBTOTAL FED LAND BANK -LESS THN lY FNMA ISSUES -LESS THN lYR 10,000,000 FEDERAL NATL MTG ASSN DISC 08/23/1996 1,800,000 FEDERAL NATL MTG ASSN DISC 06/14/1996 98.536 98.871 SUBTOTAL FNMA ISSUES -LESS THN lYR FED HM LOAN BNK -LESS THN lYR 3,100,000 FEDERAL HOME LN BK CONS DISC 98.435 MAT 08/12/1996 2,500,000 FEDERAL HOME LN BK CONS DISC 98.671 MAT 08/28/1996 3,100,000 FEDERAL HOME LN BK CONS DISC 98.698 MAT 08/14/1996 SUBTOTAL FED HM LOAN BNK -LESS THN 495,132.50 494,949.58 987,872.78 397,946.67 27,276,311.13 3,286,176.67 3,286,176.67 3,293,339.50 3,293,339.50 9,853,550.00 1,779,681.00 11,633,231.00 3,051,473.81 2,466,777.78 3,059,622.50 8,577,874.09 Page 2.1 0 .15 495,132.50 0.00 0.00 0. 0 0.15 494,949.58 0.00 0.00 0.0 0.30 987,872.78 0.00 0.00 0.0 0.12 397,946.67 0.00 0.00 0.0 8.22 27,276,311.13 0.00 0.00 0 0.99 3,286,176.67 0.00 0.00 0.0 0.99 3,286,176.67 0.00 0.00 0.0 0.99 3,293,339.50 0.00 0.00 0.0 0.99 3,293,339.50 0.00 0.00 0.0 2.97 9,853,550.00 0.00 0.00 o.o 0.54 1,779,681.00 0.00 0.00 0 3.50 11,633,23f.oo 0.00 0.00 0.0 0.92 3,051,473.81 0.00 0 .00 0.0 0.74 2,466,777.78 0.00 0.00 0.0 0.92 3,059,622.50 0.00 0.00 0.0 2.58 8,577,874.09 0.00 0.00 0.0 UC.SGUUUJ.UU CSDOC-CONSOLIDATED MELLON TRUST PORTFOLIO DETAIL BY SECTOR 31-MAY-1996 SHARES/PAR SECURITY DESCRIPTION FEDERAL FARM CREDIT BANK -LESS THAN 1 YEAR 7,000,000 FEDERAL FARM CR BK CONS DISC MAT 06/28/96 MARKET PRICE 99.140 SUBTOTAL FEDERAL FARM CREDIT BANK - BSDT RESERVE DEPOSIT ACCOUNTS 290,264 BSDT RESERVE DEPOSIT ACCOUNT- PUBLIC II 100.000 SUBTOTAL BSDT RESERVE DEPOSIT ACCOUN CANADIAN GOVERNMENT SHORT TERM 2,100,000 CANADA GOVT DISC 06/03/1996 500,000 CANADA GOVT DISC 06/05/1996 99.110 99.590 SUBTOTAL CANADIAN GOVERNMENT SHORTT TOTAL CASH & CASH EQUIVALENTS ?IXED INCOME SECURITIES U.S. GOVERNMENTS 75,500,000 US TREASURY NOTES 101.766 07.125% 09/30/1999 DD 09/30/94 13,000,000 US TREASURY NOTES 96.703 05.750% 10/31/2000 DD 10/31/95 SUBTOTAL U.S. GOVERNMENTS U.S. AGENCIES 10,000,000 FED NATL MTG ASSN MTN 5.640% 02/20/2001 DD 02/20/96 39,600,000 FEDERAL HOME LN BK CONS EDS 6.490% 09/13/2000 DD 09/13/95 15,000,000 FEDERAL HOME LN MTG CORP DEBS 94.953 98.297 96.250 % OF MARKET VALUE TOTAL 6,939,800.00 2.09 6,939,800 .00 2.09 290,264.00 0.09 290,264.00 0.09 2,081,318.75 0.63 497,950.56 0.15 2,579,269.31 0.78 63,876,266.48 19.24 76,833,330.00 23.15 12,571,390.00 3.79 89,404,720.00 26.94 9,495,300 .00 2.86 38,925,612.00 11.73 14,437,500.00 4.35 Page 3.1 COST 6,939,800.00 6,939,800.00 290,264.00 290,264.00 2,081,318.75 497,950.56 2,579,269.31 63,876,266.48 78,223,618.72 13,102,57f .13 91,326,196.85 9,593,750.00 39,890,500.00 14,554,687.50 UNREALIZED GAIN/LOSS 0.00 0 .00 0.00 0.00 0.00 0.00 0.00 0 .00 -1,390,288.72 -531,188 .13 -1,921,476.85 -98,450.00 -964,888.00 -117,187.50 BASE: USD HBll00 ESTIMATED CUR ANNUAL INCOME YLD 0.00 0.0 0.00 0.0 10,884.90 3.7 10,884.90 3.7 0.00 0.0 0.00 0.0 0.00 0.0 10,884.90 0 .0 5,379,375.00 7 747,500.00 5.9 6,126,875.00 6:8 564,000.00 5.9 2,570,040.00 6.6 898,500.00 6.2 OCSGOOOlOO CSDOC-CONSOLIDATED SHARES/PAR SECURITY DESCRIPTION MELLON TRUST PORTFOLIO DETAIL BY SECTOR 31-MAY-1996 MARKET PRICE % OF MARKET VALUE TOTAL COST • BASE: USO HBllOO UNREALIZED ESTIMATED CUR GAIN/LOSS ANNUAL INCOME YLD ---------------------------------------------------------------------------------------------------------------------------------- 5 .990% 03/06/2001 DD 03/06/96 25,000,000 FEDERAL HOME LN MTG DEB 98.755 24,688,750.00 7.44 25,000,000.00 -311 ,250.00 1,680,000.00 6.8 6.720% 10/02/2000 DD 10/02/95 25,000,000 FEDERAL NATL MTG ASSN DEB 99.422 24,855,500.00 7.49 25,351,562.50 -496,062.50 1,712,500.00 6. 8 6.850% 05/26/2000 DD 05/26/95 20,000,000 FEDERAL NTAL MTG ASSN 97 .937 19,587,400.00 5.90 20,128,125.00 -540,725.00 1,275,000 .00 6 .5 6.375% 10/13/2000 DD 10/10/95 ---------------------------------------------------------------------------- SUBTOTAL U.S. AGENCIES 131,990,062.00 39. 77 134,518,625.00 -2,528,563.00 8,700,040.00 6 BANKING & FINANCE 1,500,000 CHRYSLER FINL MTN TR# 00201 101.355 1,520,325.00 0.46 1,534,950.00 -14,625.00 122,400.00 8 . 0 8 .160% 01/31/1997 DD 01/11/95 465,000 CHRYSLER FINL MTN TR# 00224 101.398 471,500.70 0.14 475,972.61 -4,471.91 37,572.00 7.9 8.080% 01/31/1997 DD 01/31/95 1,500,000 CHRYSLER FINL MTN TR# 00258 101.113 1,516,695.00 0.46 1,522,140.00 -5,445 .00 110,700.00 7.3 7.380% 03/17/1997 DD 03/03/95 2,900,000 CHRYSLER FINL MTN TR# 00306 101.315 2,938,135.00 0.89 2,952,896.00 -14,761.00 210,830 .00 7 .1 7.270% 04/13/1998 DD 04/13/95 1,000,000 CHRYSLER FINL MTN TR# 00335 99.293 992,930.00 0.30 993,160 .00 -230.00 62,600.00 6.3 6.260% 07/20/1998 DD 07/18/95 7,100,000 FORD MOTOR CR MTN TR# 00177 99.140 7,038,940.00 2.12 6,999,748.00 39,192.00 402,570.00 5 .7 VAR/RT 03/30/1999 DD 03/30/94 4,000,000 FORD MTR CR MTN TRANCHE #TR 96 100.092 4,003,680.00 1. 21 3,970,480.00 33,200.00 243,200.00 6 . 0 FLTG/RT 11/09/1998 DD 11/08/93 3,000,000 GMAC MED TERM NTS 105.337 3,160,110.00 0.95 3,227,070.00 -66,960.00 258,750.00 8 .1 8.625% 1/10/2000 DD 1/10/95 3,700,000 GENERAL MTRS ACCEP MTN TR00324 103.887 3,843,819.00 1.16 3,911,640.00 -67,821.00 309,875.00 8 . u s.375% 02/03/1999 DD o/oJ/95 1,000,000 LEHMAN BROS INC SR SUB NTS 100.482 1,004,820.00 0.30 l,007,52f>.OO -2,700.00 70,000 .00 6 .9 7 .000% 5/15/1997 DD 5/27/94 2,000,000 SEARS DC CORP MTN SER II 102.520 2,050,400.00 0.62 2,050,400.00 0.00 180,000.00 8.7 9 .000% 08/01/1996 DD 08/01/91 1,000,000 SEARS ROEBUCK MTN# TR 00491 101.980 1,019,800.00 0.31 1,031,860.00 -12,060.00 76,900.00 7.5 7.690% 02/27/1998 DD 02/28/95 ---------------------------------------------------------------------------- SUBTOTAL BANKING & FINANCE 29,561,154.70 8.91 29,677,836.61 -116,681.91 2,085,397.00 7.0 INDUSTRIAL 1,500,000 CHRYSLER CORP DEB 104 .439 1,566,585.00 0.47 1,603,320 .00 -36,735 .00 156,000 .00 9. 9 Page 4.1 ) OCSG000l00 CSDOC-CONSOLIDATED SHARES/PAR SECURITY DESCRIPTION ----------------------------- 10 .400% 08/01/1999 9,000,000 PHILIP MORRIS COS NT 9.250% 02/15/2000 2,500,000 SEARS ROEBUCK & co NT 8.550% 08/01/1996 SUBTOTAL INDUSTRIAL TOTAL FIXED INCOME SECURITIES )THER PORTFOLIO ASSETS PAYABLES/RECEIVABLES 0 INTEREST RECEIVABLE SUBTOTAL PAYABLES/RECEIVABLES TOTAL OTHER PORTFOLIO ASSETS NET PORTFOLIO ASSETS MELLON TRUST PORTFOLIO DETAIL BY SECTOR 31-MAY-1996 MARKET % OF PRICE MARKET VALUE TOTAL 106.811 9,612,990.00 2.90 100.367 2,509,175.00 0.76 13,688,750 .00 4.12 264,644,686.70 79.73 1.000 3,400,240.91 1. 02 3,400,240.91 1. 02 3,400,240.91 1.02 331,921,194.09 100.00 Page 5.1 BASE: USO HBll00 UNREALIZED ESTIMATED CUR COST GAIN/LOSS ANNUAL INCOME YLD 9,903,780.00 -290,790.00 832,500.00 8.6 2,554,050.00 -44,875.00 213,750.00 8.5 14,061,150.00 -372,400 .00 1,202,250.00 8.7 269,583,808.46 -4,939,121.76 18,114,562.00 6 .~ 3,400,240.91 0.00 0.00 0.0 3,400,240.91 0.00 0.00 0.0 3,400,240.91 0.00 0.00 0 .0 336,860,315.85 -4,939,121.76 18,125,446.90 5.4 t Format ~ Written Report D Overheads ~ Slides 0 Flip Charts Originator _f. .......... fl ____ _ Department Head Sign orr fd,tfdges Ed Hodges Anticipated Time ___ _ FINANCE ADMINISTRATION AND HUMAN RESOURCES COMMITTEE AGENDA FOR July 10, 1996 F AH R96-42: Consideration of motion to authorize the General Manager to enter into a Contractual Agreement with a Commercial Broker to lease 4± acres of land located at Plant 1 and 30± acres of land located at Plant 2 for a period of up to 1 O years. Summary Attached for your guidance and information is the Valuation Opinion from Bozanski and Company, a real property appraisal firm, regarding 4± acres of land located north of Garfield Avenue and east of Ward Avenue at Plant 1, in the City of Fountain Valley, and 30± acres of land located, in the City of Huntington Beach, on the most northerly corner of Plant 2, bordered by Brookhurst Street on the west, the Santa Ana River bed on the east and south of the extension of Banning Avenue. The yearly leased fee rental of the subject properties would be anticipated in the range of 6% to 7.5% of the fair market value. This relates to an annual rental range of $6.80 to $7.25 psf for the Plant 1 property, resulting in an annual income of $71,000 to $95,000 and $5.00°fo $5.50 psf for the Plant 2 property, resulting in an annual rental range income in the amount of $327,000 to $539,000, excluding any brokerage fee. The report concludes that because these sites may be necessary for long-term District needs and therefore not suitable for permanent improvements, the highest and best use of this vacant land would be as a storage yard, nursery, or Christmas tree farm. (This complete report is available upon request.) Budgetary Impact These revenues have not been anticipated in the FY '96-97 budget. If the Districts are successful in leasing these sites, it would increase annual revenue in the range of $398,000 to $634,000, not including any commercial brokerage lease fees. Staff Recommendation Staff is requesting authority to prepare a request for qualifications and solicit proposals from commercial brokers in the Orange County area to assist in the lease of this land. Additionally, staff recommends that the General Manager be authorized to enter into an agreement, in a form acceptable to General Counsel, with a commercial broker to lease the above referenced land for a period of up to 10 years. J:\WPDOC\FIN\CRANE\FPC.MTG\FAHR.96\COVERS.96\FAHR96.42 .. June 5, 1996 FAHR96-42: STAFF REPORT Consideration of motion to authorize the General Manager to enter into a Contractual Agreement with a Commercial Broker to lease 4± acres of land located at Plant 1 and 30± acres of land located at Plant 2 for a period of up to 10 years. Asset management provides an opportunity to increase revenues to the Districts. For the past 10 years, flows have remained the same; yet during the late 1980's and early 1990's an aggressive building program was pursued. The Districts are now at the point where vacant land can be considered for alternative revenue productive uses. In early 1996, staff was approached by the City of Fountain Valley with a proposal to lease a portion of Plant 1, for a ten year period, that they could use as their city yard. As a result of that request, staff retained Boznanski and Company to evaluate the market value and the fair rental value of a 4± acre parcel located at Plant 1 and a 30± acre parcel of Plant 2. Attached for your guidance and information are the cover letter and Summary of Salient Facts and conclusions for the two reports. Complete copies of their reports are available, upon request. The report concluded that the highest and best use of the vacant land would be as a storage yard, nursery, Christmas tree farm , etc. The report concludes that the anticipated yearly annual rental range for the Plant 1 property could be $6.80 to $7.25 per square foot. This could result in an annual income of $71,000 to $95,000, not including any brokerage fee. Additionally, the anticipated yearly annual rental range for the Plant 2 property could be $5.00 to $5.50 per square foot. This could result in an annual income of $327,000 to $539,000, not including any brokerage fee. The typical published brokerage fees for leasing improved property is as follows: • 5% of the total base rental for the first 60 months in which base rent is to be paid, plus • 2 1/2% of the base rental for the next 60 months in which base rent is to be paid, plus • 1 1/2% of the total base rental for the remainder of the term. Their rates are merely illustrative of the commercial brokerage lease market and show an order of magnitude expense that must be factored into any lease arrangement. Given the scope of the parcel and the long term nature of the lease, staff believes that any brokerage agreement should be competitively bid and negotiated as further savings may be realized. CSDOC e P.O Box 8127 e Fountain Valley, CA 92728-8127 e (714) 962-2411 FAHR96-42 Page2 June 5, 1996 Since the time that this evaluation was made, the City of Fountain Valley has decided to make other arrangements. However, staff believes that there are potential users (ie: nurseries, tree farm, storage yards, etc.) that might benefit from such a lease. BUDGET INFORMATION These revenues have not been anticipated in the FY '96-97 budget. If the Districts are successful in leasing these sites, it would increase our annual revenue in the range of $398,000 to $634,000, not including any commercial brokerage lease fees. RECOMMENDATION Therefore, staff is requesting authority to prepare a request for qualifications and solicit proposals from commercial brokers in the Orange County area to assist in the lease of this land. Additionally, staff recommends that the General Manager be authorized to enter into an agreement, in a form acceptable to General Counsel, with a commercial broker to lease the above referenced land for a period of up to 10 years. EEH:fw R:\WPDOC\331 0\EH\FAHR\96-42.SR CARL W. BOZNANSKI Di\NIEL H. HERRON BIAKE E. BOZNANSKI BIWE J. VAN HORN ~c-Jtuta MARK W. LINNES ROBMDDON MICHAEL A. TAYLOR Ms. Judith A. Wilson ,,....._,_) Boznanski & Company PROPERTY VAWATION & CONSULTATION 283 NORTH RAMPART S11lEET SUrrEA ORANGE. CAUFORNIA 92668-1850 March 29, 1996 Re: Valuation Opinion - nllPHONES (714) 634-3813 (213) 623-8471 FAX (714) 634-4026 Chief Administrative Officer County Sanitation Districts Portion of Plant 2 Huntington Beach, California of Orange County 10844 Ellis Avenue Fountain Valley, California 92708-7018 Dear Ms. Wilson: File No. 1260.02 In accordance with the written authoriz.ation we have received, Boznanski and Company, a real property appraisal firm, has evaluated the market value and the fair rental value of the fee simple interest of land underlying a portion of Plant 2 as owned by the County Sanitation Districts of Orange County, in the City of Huntington Beach, as existing. Our date of value is current, as of March 29, 1996. The subject site occupies the northerly mqst 30± acres of Plant 2, in the City of Huntington Beach. It is bordered by Brookhurst Street on the west, the Santa Ana River bed on the east, and south of the extension of Banning A venue. This site is generally triangular in shape. This parcel is zoned for industrial uses . • Once the property's fee value is determined, our task here is to establish an interim rental value of thi3"'30 acre parcel as leased out for some restricted use. The site would have one access, as existing opposite Banning Avenue. Permanent buildings would not be permitted. The anticipated base lease term would be for 10 years with possible options to extend The site apparently has no sewer readily available, with nominal electricity and water nearby. Based on the investigation and analysis outlined in the accompanying report, and subject to the certification and contingent an~iting conditions attached to this report, we conclude that the market valu ;itfi\ fee simple interest in the 30 acre Plant 2 subject property, located in ll,i~tl~~ Beach, California, as of March 29, 1996, is in the rounded range of $5 ., , · $5.50 psf. $6,534,000 to $7,187,000 County Sanitation Districts of Orange County -2-March 29, 1996 The anticipated yearly leased fee rental of the subject property would be anticipated to be in the range of 5% to 7.5% of the fair ~uirket value thus relating to an annual rental range of: ~'\, ~$539,000 Considering that we are only evaluating the underlying land here, and that there are no improvements existent, only the Market Approach based on sales of vacant land, would have application in this analysis. Thus, the traditional Market Approach to improved property, and the Cost-Summation Approach would have no direct application here sinci""" both of these techniques assume some type of improvements, which are non-exist1iere. ,/ The Income Approach is utilized by considering the net operating income that ~ be achieved from the subject property based on observed rates of return. We have also considered the requirements established by the Financial Institutions Reform, Recovery and Enforcement Act (FIRREA) and the Uniform Standards of Professional Appraisal Practice (USP AP). Among other factors, this pertains to report preparation, value discounting during absorption period and takes into account discounting of unusual lease and sales teI'll_lS observed in the marketplace. Any significant changes to the site size or configuration, to the improvements in size or quality, or any other material information supplied to us in this analysis, as further identified herein, could affect our valuation cqnclusion and would require a re-evaluation of our analysis. Following this letter is a self-contained appraisal report·which describes the subject area and the conditions of this appraisal, identifies the subject property and its characteristics and then specifically enumerates the methodology used in valuing the subject property. We retain a copy of this report, together with worksheets, documents and other data upon which our conclusions and opinion of value are based. We certify that we have no past, present or contemplated future interest in this property and that we have acted in accordance with accepted ethics and standards in our profession. County Sanitation District of Orange County -3-. April 1,1996 Thank you for this opportunity to provide appraisal services. CWB/bjv R spectfully sub~,ftf • '·• Carl W. Boznanski, C. Principal Appraiser President Certified General Appr CA# AG010837 SUMMARY OF SALIENT FACTS AND CONCLUSIONS PROPERTY ADDRESS: DATE OF VALUE: INTEREST APPRAISED: OWNER: PROPERTY: ASSESSOR'S PARCEL NOS.: SITE SIZE: ZONE: USE TYPE: I:IlGHEST AND BEST USE: "As Though Vacant Land": "As Improved": • VALUE INDICATIONS: Cost Approach: Market Approach (Land): Annual Rental Value: East side of Brookhurst Street opposite Banning Avenue, Hwitington Beach March 19, 1996 Fee Simple County Sanitation District of Orange County 156-181-2, 3 and 3 30 acres (Portion of larger sanitation district operating plant) M-1-A-CZ (Restricted Manufacturing District -Coastal Zone); City of Huntington Beach Vacant Short term use as a storage yard, nursery, Chri~tmas tree farm, etc. Not applicable NIA · -, :~ S¥34J)J)9)to. $7,187,000 ~~eo to $539,000 V CARL W. BOZNANSKI Di\NIEL H. HERRON BLAKE E. BOZNANSKI BIWE J. VAN HORN ValadoeCoMtaltub MARK W. UNNES ROBPADDON MICHAEL A. TAYLOR Ms. Judith A. Wilson Boznanski & Company PROPERTY VALUATION & CONSULTATION 283 NORnl RAMPART SlREET SlJrreA ORANGE, CALIFORNIA 92668-1850 March 29, 1996 Re: Valuation Opinion- Portion of Plant 1 TELEPHONES (714) 63,1.3813 (213) 623-8471 FAX (714) 634-4026 Chief Administrative Officer County Sanitation Districts Fountain Valley, California of Orange County 10844 Ellis Avenue Fountain Valley, California 92708-7018 Dear Ms. Wilson: File No. 1260.01 In accordance with the written authorization we have received, Boznanski and Company, a real property appraisal finn, has evaluated the market value of the fee simple interest of land underlying Plan 1 as owned by the County Sanitation Districts of Orange County, in the City of Fountain Valley, as existing. Our date of value is current, as of March 29, 1996. . The subject property is located on a 4± acre rectangularly shaped parcel of land located north of Garfield Avenue and east of Ward Avenue in the City of Fountain Valley. It is an integral part of a 110± acre site, commonly known as Plant 1 of the County Sanitation Districts of Orange County. We looked to the highest and best use of this industrially zoned property to be for a light industrial and business park purposes. Once the property's fee value is determined, our task here is to establish an interim rental value of this 4 acre parcel as leased out for some restricted use. The site would have one access off of Garfield Avenue. Nominal permanent buildings would be permitted. The anticipated base lease term would be for 10 years with possible options to extend The site apparently has no water or sewer readily available, with nominal electricity nearby. Based on the investigation and analysis outlined in the accompanying report, and subject to the certification and contingent and limiting conditions attached to this report, we conclude that the market value o~e simple interest in the existing 4± acre Plant 1 subject property, located !~tain Valley, California, as of March 29, 1996, is in the rounded range of$6F ,o $7.25 psf, or: Sl,18Sj0 to $1,263,000 County Sanitation Districts of Orange County March 29, 1996 ~ The anticipated yearly leased fee rental of tbf~~ect property would be anticipated to be in the range of 6% to 7.5% of thM ~~\rket value thus relating to an annual rental range of $71,000 to $95,000. ~\'-:., Considering that we are only evaluating the underlying land here, and that there are no improvements existent, only the Market Approach based on sales of vacant land, would have application in this analysis. Thus, the traditional Market Approach to improved property, and the Cost-Summation Approach would have no direct application here since both of these techniques assume some type of improvements, which are non-exist here. The Income Approach is utilized by considering the net operating income that can be achieved from the subject property based on observed rates of return. We have also considered the requirements established by the Financial Institutions Reform, Recovery and Enforcement Act (FIRREA) and the Uniform Standards of Professional Appraisal Practice (USP AP). Among other factors, this pertains to report preparation, value discounting during absorption period and takes into account discounting of unusual lease and sales terms observed in the marketplace. Any significant changes to the site size or configuration, to the improvements in size or quality, or any other material information supplied to us in this analysis, as further identified herein, could affect our valuation conclusion and would require a re-evaluation of our analysis. Following this letter is a self-contained appraisal report which describes the subject area and the conditions of this appraisal, identifies the subject property and its characteristics and then specifically enumerates the methodology used in valuing the subject property. We retain a copy of this report, together with worksheets, documents and other data upon which our conclusions and opinion of value are based. We certify that we have no past, present or contemplated future interest in this property and that we have acted in accordance with accepted ethics and standards in our profession. . ' .. , 1 County Sanitation District of Orange County -3-March 29, 1996 Thank you for this opportunity to provide appraisal services. CWB/bjv Respectfully submitted, , Principal Appraiser President Certified General App ser CA# AG010837 SUMMARY OF SALIENT FACTS AND CONCLUSIONS PROPERTY ADDRESS: DATE OF VALUE: INTEREST APPRAISED: OWNER: PROPERTY: ASSESSOR'S PARCEL NO: SITE SIZE: ZONE: USE TYPE: HIGHEST AND BEST USE: "As Though Vacant Land": "As Improved": VALUE INDICATIONS: Market Approach: Annual Rental Value: North side of Garfield Avenue east of Ward Street, Fountain Valley March 29, 1996 Fee Simple County Sanitation Districts of Orange County 156-101-03 (Portion) 4 acres (Portion of larger 110± acre Sanitation District operating plant) M-1 (Manufacturing District); City of Fountain Valley Vacant NIA Format • Written Report • Overheads isndes • Flip Charts Originator /1(\,~~ Department Head Sign Off ~ Anticipated Time 10 mins. FINANCE, ADMINISTRATION AND HUMAN RESOURCES COMMITTEE AGENDA FOR JULY 10, 1996 FAH R96-43: Authorize Human Resources Department to issue Request for Proposal (RFP) for professional consultant services to conduct a study to determine feasibility of broadbanding Summary The Districts' current classification structure has 146 separate job classifications. That equates to a different job title for every fourth employee. Management believes this specialization is contrary to the goals of a productive and flexible workforce. The rapidly changing technological environment is forcing organizations to continually expand the skills of employees. Companies need generalists who can adapt and change as an organization evolves. Specialized professional services are increasingly being contracted out. Broadbanding is a salary management system in which several existing salary ranges with widths of 40-50 percent are collapsed into a few very wide salary ranges with widths of 100 percent or more. These wider salary ranges are commonly referred to as Mbands.R It is foreseeable that the Districts can reduce job families with up to twelve classifications to two or three through broadbanding. For many organizations, broadbanding supports a dramatic change in the organization's culture, fosters a flatter organization, creates a broadly skilled workforce, encourages teamwork, and supports career development opportunities. It is recommended that an outside consultant be brought in to evaluate the Districts' objectives for designing a broadbanding program and to evaluate the existing pay administration program to determine if broadbanding will support the agency's objectives. A consultant will have experience with what can go right and what can go wrong with broadbanding. Fiscal Impact Staff has budgeted $40,000 for this study, and is asking for approval to solicit bids from qualified consultants. Human Resources staff will closely monitor the study and will provide much of the administrative assistance in order to minimize costs. Recommendation Authorize Human Resources Department to issue Request for Proposal (RFP) for professional consultant services to conduct a study to determine feasibility of broadbanding. J:\WPDOC\FIN\CRANE\FPC.MTG\FAHR.96\COVERS.96\FAHR96.43 July 10, 1996 STAFF REPORT FAHR96-43: Authorize Human Resources Department to issue Request for Proposal (RFP) for professional consultant services to conduct a study to determine feasibility of broadbanding BACKGROUND What is Broadbanding? Broadbanding is a salary management system in which several existing salary ranges with widths of 40-50 percent are collapsed into a few very wide salary ranges with widths of 100 percent or more. These wider salary ranges are commonly referred to as "bands." Typically, there are no midpoints or control points within the salary ranges, but rather market points or zones which indicate the market value of a particular job. For some organizations, the purpose for broadbanding is simply to reduce the number of salary ranges and widen pay ranges to simplify the job evaluation process and reduce administrative bureaucracy. For other organizations, broadbanding supports a dramatic change in the organization's culture, fosters a flatter organization, creates a broadly skilled workforce, encourages teamwork, and supports career development opportunities. Where properly implemented, broadbanding can decrease the emphasis on racing up the corporate ladder and focus on "getting the job done." William M. Mercer, a leading compensation and human resource consulting firm, conducts an annual planning survey of 3,000 organizations, public and private, covering all industry segments. According to the survey, 12% of organizations use broadbanding and 31% are considering implementing broadbanding. Research shows that broadbanding is used by various types of organizations. Hewitt Associates LLC conducted a major research study for the American Compensation Association in which approximately 116 companies that had implemented broadbanding were interviewed. The companies ranged in size from 65 to 127,000 employees, with revenues between $7.5 million to $44 billion, and were from both manufacturing and nonmanufacturing industries, including government and utilities. Broad Grades vs Career Bands Some organizations follow what is known as "the traditional" view of broadbanding by installing "broad grades" to promote organization flexibility and to streamline salary administration. Organizations that use broad grades are more likely to have traditional salary administration CSDOC • P.O. Box 8127 • Fountain Valley, CA 92728-8127 • (714) 962-2411 FAHR96-43 Page2 July 10, 1996 practices using midpoints, zones or control points within bands. These organizations reduce their number of pay levels just slightly, creating bands that are only about twice as wide as the original salary grades. Other organizations use "career bands" to enhance career mobility and promote significant cultural change. Organizations that use career bands tend to reduce the number of pay levels more dramatically and install bands that are three to eight times wider than the previous salary ranges. They are also less likely to use traditional control points within bands. Career banding is most typically associated with broadbanding and is the most widely used design option. Number of Bands Companies that implement broadbanding typically reduce the number of salary ranges by one- third to one-half the original number of ranges. The number of bands is determined by the number of "value-added" contribution tiers that exist within an organization. The contribution tiers reflect the various levels of employee contributions -for example, "Administrative Support," "Professional," and "Management." Organizations that implement broadbanding typically have four (4) broad grades or two (2) career bands for executive management; three (3) broad grades or three (3) career bands for exempt employees; and, four (4) broad grades or two (2) career bands for nonexempt employees. A general profile is developed for each band describing the characteristics of the jobs assigned to it. Jobs are assigned to a band by comparing the job descriptions to the band profiles. Zones A common approach to controlling movement within a band involves the creation of zones. Each band is divided into zones (typically three zones) and jobs are placed in a zone based on market value. Movement within the zone is based on performance. Movement into a higher zone requires attainment of successively more demanding and valued skills or competencies which may be acquired through training, experience, additional education or lateral career development moves within a zone. Skill sets for each zone are developed to guide the manager in determining when movement to a higher zone is appropriate. Employee Performance, Career Planning and Band Movement A performance management system that rewards employees for successful achievement of performance objectives that support the overall mission of the organization should be in place to support the broadbanding effort. An effective training program that identifies an employee's career planning goals also must be in place to support the broadbanding effort. The combination of an effective performance management system, an effective training program and a salary administration system that encourages lateral moves, rewards employees for the acquisition of skills or competencies, and rewards for promotional opportunities will support an organization's objective to become flatter, more broadly skilled, encourage teamwork, and promote career development. FAHR96-43 Page 3 July 10, 1996 Employees will move up bands if they continue to perform at a high level and are willing to move laterally within a band. High growth employees will consistently exceed expectations and will experience a lot of intra-band moves, typically every two years. A growth employee will consistently exceed expectations, but not have as many intra-band moves. A stable employee will meet expectations and have no intra-band moves. Performance will become an integral part of career opportunities within the broadbanding system. Impact on Costs Many people assume that broadbanding will increase payroll costs, however, research indicates that this is not the case. In a study conducted by Hewitt Associates, 70% of the companies questioned through a survey regarding their experience with broadbanding indicated that their payroll costs were no harder to control under bands than under the previous system. Although jobs have wider pay ranges and managers have more discretion with broadbanding, they receive no more money for salary increases than they did before and they must still manage within the same budget restrictions. They are forced to manage their compensation costs. One organization claims to have reduced spending on salary increases with broadbanding because their managers were more sensitive to market value of jobs and were not willing to pay above- market rates. Scope of Work for Study It is recommended that an outside consultant be retained to evaluate the Districts' objectives for designing a broadbanding program and to evaluate the existing pay administration program to determine if broadbanding will support the agency's objectives. A consultant will have experience with what can go right and what can go wrong with broadbanding. If it is determined that broadbanding can be an effective salary administration tool, the consultant will, with assistance from Districts' staff, design a broadbanding program; conduct a salary and classification study to determine where the most appropriate bands exist and what the actual market values are of the jobs within those bands; and, develop profiles for the bands. Districts' staff will act as technical advisor to the consultant and employees will be asked to participate on broadbanding design teams. The schedule for the study will be as follows: 7/25/96 8/16/96 By 8/21/96 8/22/96 8/26/96 10/26/96 Recommendation RFP Mailing Proposal Due Date -5:00 p.m. Selection Committee Evaluation Proposed Award Date Estimated Project Start-up Project Completion Date Recommend Boards approval issuing a Request for Proposals (RFP) to conduct a study to determine the feasibility of broadbanding within the Districts. MP J:\WPDOC\FIN\CRANE\FPC.MTG\FAHR.96\STAFFRPT.96\SRFAHR96.43 Format • Written Report • Overheads • Slides • Flip Charts Originator~ Department Head Sign Off~ Anticipated Time __ _ FINANCE, ADMINISTRATION AND HUMAN RESOURCES COMMITTEE AGENDA FOR JULY 10, 1996 F AH R96-44: Alcohol and Controlled Substances Policy and Testing Program Summary The Omnibus Transportation Employee Testing Act requires every driver who operates a commercial motor vehicle in interstate or intrastate commerce, and is subject to commercial driver's license requirements, to be subject to an Anti-Drug and Alcohol Program. The Program states that the Districts will supply educational materials to explain the policies and procedures, specify conduct prohibited by the regulations, conduct random substance abuse testing, and advise employees of available resources. This Program implements federal legislation. A copy of the County Sanitation Districts of Orange County Substance Abuse and Alcohol Misuse Plan will be available at the meeting. Recommendation Approve Resolution No. 96-_ amending Resolution No. 95-105. J:\WPDOC\FIN\CRANE\FPC.MTG\FAHR.96\COVERS.96\FAHR96.44 July 10, 1996 STAFF REPORT FAHR9644: Alcohol and Controlled Substances Policy and Testing Program Summary The Omnibus Transportation Employee Testing Act requires every driver who operates a commercial motor vehicle in interstate or intrastate commerce, and is subject to commercial driver's license requirements, to be subject to an Anti-Drug and Alcohol Program. The Program states that the Districts will supply educational materials to explain the policies and procedures, specify conduct prohibited by the regulations, conduct random substance abuse testing, and advise employees of available resources. This Program implements federal legislation. A copy of the County Sanitation Districts of Orange County Substance Abuse and Alcohol Misuse Plan will be available at the meeting. Background The Omnibus Transportation Employee Testing Act of 1991 requires alcohol and drug testing of safety sensitive employees in the aviation, motor carrier, railroad and mass transit industries. The Department of Transportation published rules mandating anti-drug and alcohol misuse prevention programs in February of 1994. These rules require employers with safety sensitive employees, including the Districts, to implement those regulations. The job classifications that are affected by the DOT requirement include Line Cleaners and Equipment Operators. The incumbents in these classifications are required to have a commercial license which enables them to drive or operate the Districts' large trucks, cranes, vehicles, etc. The regulations require that the Districts: 1. Provide educational materials that explain the policies and procedures with respect to meeting the requirements; 2. Specify conduct prohibited by the regulations; 3. Establish a program of pre-employment and random substance abuse testing; 4. Advise employees of resources available in resolving problems associated with the misuse of alcohol or other controlled substances. Recommendation Approve Resolution No. 96-_ am mending Resolution No. 95-105. MP J:\WPDOC\FIN\CRANE\FPC.MTG\FAHR.96\STAFFRPT.96\SRFAHR96.44 CSDOC e P.O. Box 8127 e Fountain Valley, CA 92728-8127 e (714) 962-2411 ~ • Written Report • Overheads D Slides o Flip Charts Origiaa~,t-- Oepartment Head Sign Off __ _ Gary Streed Anticipated Time __ _ FINANCE, ADMINISTRATION AND HUMAN RESOURCES COMMITTEE FAHR96-45: Summary AGENDA FOR JULY 10, 1996 Approval of Joint Powers Agreement Establishing the Orange County Council of Governments. The Orange County Council of Governments (COG), was officially formed in June, 1996 when the requisite number of cities approved the Joint Powers Agreement (JPA) establishing this organization. The JPA for the COG provides for an organization of 21 voting members. These include: Orange County's 12 delegates to SCAG; and one member each from the following: Orange County Division of the League of Cities; County of Orange; Orange County Transportation Authority; Independent Special Districts of Orange County/Water Agencies representative; Orange County Cities AQMD representative and County of Orange AQMD representative; an at-large Orange County City; and the County Sanitation Districts of Orange County. Also included are two non-voting members representing the private sector and the universities. The COG is not intended to be another layer of government. Rather, it was intended to replace the Orange County Regional Advisory and Planning Council (RAPC), which has existed since 1991. The COG's functions will include issues such as air quality attainment strategies, providing subregional input to SCAG in it's development of mandated regional plans, review of legislation pertaining to regional issues, liaison with the private sector, performing regional housing needs assessments, and developing data for studies and planning activities. Budget Impact There are no membership dues required. The COG will not require new staff and instead will tap into existing staff resources from member entities. The COG's expenses will be covered through funds made available to the Orange County subregion from SCAG. Staff Recommendations Aµprove the Joint Powers Agreement establishing the Orange County Council of Governments. J:\WPDOC\FIN\CRANE\FPC.MTG\FAHR.96\COVERS.96\FAHR96.45 June 26, 1996 FAHR96-45: 1. Background STAFF REPORT Approval of Joint Powers Agreement Establishing the Orange County Council of Governments. Efforts to do regional consensus-building and planning in Orange County date back to 1973 with the establishment of the Intergovernmental Coordinative Council. In 1980, a Subregional Planning Council was formed to be replaced in 1987 by the City/County Working Group. The current Regional Advisory and Planning Council (RAPC) was formed in 1991. Subsequent to the bankruptcy, local jurisdictions and agencies have been re-examining traditional roles and responsibilities. In January, 1996, the Orange County Division of the League of Cities passed a resolution directing its staff to develop a Joint Powers Agreement (JPA) forming a Council of Governments (COG) for consideration by the cities, the county and other affected public agencies. This resolution was passed as a consequence of a recommendation made by the Orange County City Manager's Association. In response to the bankruptcy and the expectation that the County of Orange would be reducing its role in regional issues, the City Manager's Association convened a task force to determine the most effective means of comprehensively addressing regional planning. The Task Force reviewed various models for addressing regional planning issues and recommended the formation of a COG. The COG was intended to provide an arena for public agencies to exchange ideas and information, conduct studies, and build consensus among members on regional and subregional issues, as well as advocating Orange County interests at the regional, state, and federal level. 11. Issues Regarding Formation of the COG The formation of the COG required the approval of the JPA by a majority of cities representing a majority of the population. This threshold was reached on June 3, 1996. To date, 24 cities have approved the agreement (this includes all Districts' participating agencies/cities with the exception of Anaheim, Garden Grove, Seal Beach and Yorba Linda). Although the cities have been supportive of the COG's formation, other agencies and interests have indicated concerns. County of Orange The County has not taken action on the JPA. Jan Mittermeier, County CEO, has expressed concerns about the purpose and functions of the COG, in particular, a concern that the COG may get into the direct delivery of services. Since the COG can also compete for federal and state grants, she has also indicated a concern that it may syphon off funds that might otherwise go to the County. CSDOC • P.O. Box 8127 • Fountain Vallev. CA 92728-8127 • (714) 962-2411 FAHR96-45 Page 3 June 26, 1996 also maintained that because the MOU for the Cal State Fullerton Center for Demographic Analysis requires that its work products be reviewed by RAPC, RAPC must continue to exist unless the MOU is specifically amended. She further noted that the County is currently paying more than half of the costs of the Center and is not ready to support the COG at this time. At this writing, meetings are underway between the County Counsel and League Counsel as well as among the funding partners of the Center for Demographic Analysis to resolve these issues. The Executive Management Committee of RAPC will be meeting on July 1 O to review progress on these issues. Districts' staff will brief the FAHR Committee at the July 10 FAHR Committee regarding these discussions. RECOMMENDATION: The Orange County Council of Governments is now established. The Joint Powers Agreement provides for representation by the Sanitation Districts. The Districts have been an active participant in RAPC. Assuming that the COG is the successor agency, and noting the Districts need to be well informed about regional planning issues, it is recommended that the attached Joint Powers Agreement be approved. JAW:cmc J:\WPDOC\FIN\CRANE\FPC.MTG\FAHR.96\STAFFRPT.96\SRFAHR96.45 JOINT POWERS AGREEMENT ESTABLISHING THE ORANGE COUNTY COUNCIL OF GOVERN:MENTS This presentation reflects the Agreement made between the Member Agencies (listed in Exhibit 2) hereinafter collectively or individually referred to as "Member Age!1cies." RECITALS A. Chapter 5 of Division 7 of Title 1 (commencing with Section 6500) of the California Government Code authorizes two (2) or more public agencies to jointly exercise any power common to them. B. Each Member Agency and party to this Agreement is a (governmental) entity established by law with full powers of government in legislative, administrative, financial and other related fields. C. Member Agencies realize the urgent need for areawide planning and coordination in order to provide advice to public entities on a range of issues that affect multiple interests. D. Member Agencies believe that the joint exercise of their powers will provide an organization capable of conducting studies and projects designed to improve and coordinate common governmental responsibilities and services on an areawide and regional basis through the establishment of a council of governments. E. Member Agencies wish to create a unified subregional organization which will improve Orange County's abilities to be represented in the southern California region, the State of California and the nation on issues and matters that affect collective Orange County interests. F. Member Agencies believe that an Orange County Council of Governments is best suited to accomplish the preparation of subregional plan components mandated by 1 a. To exercise jointly the common powers of its members to manage and administer any implementation agreement or program; b. To make and enter into contracts; c. To contract for the services of engineers, planners, financial consultants and others and apart therefrom to employ such other persons, as it deems necessary; d. To adopt rules, regulations, policies, bylaws and procedures governing the operation of OCCOG; e. To apply for grants under any federal, state, regional or local programs as needed to achieve member objectives; f. To receive gifts, contributions and donations of property, funds, services and other forms of financial assistance from persons, firms, corporations and any governmental entity; g To the extent not specifically provided in this Agreement, to exercise any powers authorized by the member agencies to achieve the OCCOG 's objectives. 3 .1 Membership SECTION 3 ORGANTZA TIQN The parties to OCCOG shall be each public entity which has executed or hereafter executes this agreement, or any addenda, ainendment, of supplement thereto, and which has not, pursuant to provisions hereof, withdrawn from the OCCOG. Other entities within Orange County may petition to become a member of the OCCOG by submitting to the Board of Directors (The Board) a resolution adopted by its governing body. The Board shall review the petition for membership and shall vote to approve or disapprove the petition. If the petition is approved by a majority of the Board the petitioning entity shall become a member of theOCCOG. The names and addresses of the member parties at any time shall be shown on Exhibit 2, attached, as amended or supplemented from time to time. 3 4.2 SCAG District Representatives For OCCOG members who are appointed as SCAG district representatives, participation/membership in SCAG is not a prerequisite for OCCOG membership. For SCAG District representatives to OCCOG who are not members of SCAG, OCCOG membership will be detennined by the jurisdiction(s) that constirute the SCAG District. This applies to both City and County representatives. 4.3 AQMD Governing Board Representatives The AQMD representatives to OCCOG shall be the Orange County Cities and the County of Orange representatives to the Governing Board of the South Coast Air Quality Management District. Should the Cities AQMD Governing Board position be vacant, the vacancy on OCCOG shall be filled through the City Selection Process of the Orange County Division, League of California Cities. Should the County's AQMD Governing Board position be vacant, the vacancy on OCCOG shall be filled by the Orange County Board of Supervisors. 4.4 Appointments by Member Agencies OCCOG representatives for the County of Orange (1 member), the Orange County Transportation Authority (1 member), the Orange County Transportation Corridor Agencies (1 member), and the Orange County Sanitation Districts (1 member) will be appointed by these agencies' governing boards. The representative (1 member) from the Orange County Division, League of California Cities will be appointed by that organization's Executive Steering Committee. The at-large representative of the Orange County Cities will be selected annually by Orange County Cities through the City Selection Committee. The Independent Special Districts of Orange County (ISDOC) / water agency representative will be determined by its Board of Directors . 4.5 Private Sector Representation An ex-officio, non-voting representative from the private sector (as determined by the OCCOG) will be determined by that private sector entity. 5 elected official shall represent that agency on the OCCOG Board of Directors. Procedures for filling open OCCOG member positions will follow those described in this Sections 4.2, 4.3, and 4.4. 4.11 Officers Chair: The Chair of the Board shall be elected annually at the first regular meeting of each calendar year. Any Board member may be authorized to represent the Board upon approval by the Chairman. Vice Chair: The Vice Chair of the Board shall be elected annually at the first regular meeting of each calendar year, and have all the powers to act in the place of the Chair in the Chair's absence. 4.12 Quorum A majority of appointed voting directors shall constitute a quorum for acting on the business of the Board. If such number of Board members is an even number, a majority shall be one more than half the number of appointed directors to the Board. 4.13 Meetings Regular Meetings: Regular meetings of the Board shall be held every month according to a schedule approved by the Board at its first meeting each calendar year. Special Meetings: Special meetings may be called by the Chairman or a quorum of Board members. · Brown Act: All meetings shall be called and conducted in accordance with the Ralph M. Browri Act. 4.14 Bylaws Bylaws providing additional details pertaining to the conduct of OCCOO and its support structure will be established and approved by the OCCOG Board. 7 5.2 Funding Funding for the Council's operation will be provided by monies provided to Orange County from the Southern California Association of Governments, member and/or non-member agency financial contributions, grants, and other sources authorized and approved by the OCCOG Board of Directors. 5.3 Assignment of Additional Responsibilities In addition to the initial OCCOG tasks identified in Exhibit I, additional responsibilities will be undertaken by OCCOG in accordance with the-following procedures. a. Requests to Examine Issues and Provide Input/Recommendations: Requests from non-member and member agencies may be made to OCCOG to examine activities and provide recommendations. The OCCOG shall assign the Executive Management Committee the task of examining staffing/funding issues and providing recommendations to OCCOG on how and whether it might choose to pursue the request. In addition to considering potential staffing/funding constraints, the EMC will also base its recommendations, and the OCCOG shall consider, on whether the request/issue has strong countywide support among OCCOG members and can reduce or eliminate duplication, improve efficiencies and otherwise achieve countywide consensus and OCCOG objectives. b. Assignment of Responsibilities to OCCOG: Should requests from member and/or non-member agencies be made for the OCCOG to assume responsibility for delivery of services, development of plans, programs or similar activities, the OCCOG would assume said responsibilities upon a 2/3 vote of its Board of Directors, with concurrence of the affected agency (ies). 9 6.6 Accounts and Reports The OCCOG shall establish and maintain such records and accounts which are deemed necessary to account for and report on the various sources of funds, expenditures, grants, programs and projects and, as may be required by good accounting practice, the State Controller or the United States Government. The books and records of the OCCOG shall be open to inspection by representatives of the members agencies at all reasonable times. SECTION? INDEMNITY 7 .1 Hold Harmless and Indemnity Each party hereto agrees to indemnify and hold the other parties harmless from all liability for damage, actual or alleged, to persons or property arising out of or resulting from negligent acts or omissions of the indemnifying party of its employees. 7 .2 The member agencies, and their employees, officers, members and directors will not be liable to OCCOG (or anyone who may claim any right because of a relationship with OCCOG) for any acts or omissions related to the service to OCCOG described in Section 5.1. OCCOG and its members will indemnify and hold the members harmless from any obligations, costs, claims, judgments, attorney's fees, and/or attachments in any way connected with the services provided to OCCOG under this agreement. 8.1 Termination SECTION 8 TERMINATION AND DlSSOLUTION The OCCOG shall continue to exercise the joint powers herein until the termination of this Agreement and any extension thereof or until the parties shall have mutually rescinded this Agreement; providing, however, that the OCCOG and this agreement shall continue to exist for the purposes of disposing of all claims, distribution of assets and all other functions necessary to conclude the affairs of the OCCOG. Termination shall be accomplished by a majority action of the Board. 11 EXHIBIT I INITIAL OCCOG RESPONSIBILITIES 1. Demographic activities in conjunction with California State University (or successor) as described in attached Memorandum of Understanding 2. Air Quality Activities • Input to development of Transportation Control Measures for Air Quality Management Plans. Market incentive plans and technologies promotion and implementation. • Monitoring regional, state and federal air quality plans and requirements • Liaison with SCAG, SCAQMD and others on air quality issues 3. Orange County Input to SCAG Activities • Regional Comprehensive Plan & Guide development and implementation • Input to development of long-range transportation plans prepared by transportation commissions · • Preparation of other long-range plans/strategies as agreed by affected officials 4. Intergovernmental coordination with public and private sectors 5. Legislative Review/Outreach/Interface on activities affecting member agencies 6. Regional Housing Needs Assessment 13 IN WITNESS WHEREOF, the parties hereto have executed this Agreement as evidenced by the signatures below. ORANGE COUNTY COUNCIL OF GOVERNMENTS DATED: ________ _ ATTEST: DATED: _________ _ cogsignaturcpage 13 By: Chair Attest: Clerk -.•. ·"SAHt:JM IJH~:A Hl!~:NA l'."ltK 1;osTA ~ESA 1:Vl'IU'.SS llA~A l'(ll:>/T mi::-.TAIN \'AIJ 't ~U:.J.J::RTON <:AROF.N 1.;ROV 791 P02 JUN G'( . '.::1t:l 1.4:4:;i '7Yl~.,-~t-r6 Mil w~~T JA:"iT.\ A~A em•t.lWARI) s,urE H~. Ul'ITA MU. CALIFORNIA •121111 TI:LErtlONE ••H1 ~•:•0011 f,\:,C: p1~1 •lll•IIIO Reed Royalty Executive Vice President Orange County Taxpayers Association 30205 Hillside Terrace San Juan Capistrano, CA 92675 June 21, 1996 Subject: Orange County Council of Governments • ._,(,,,(!; HU:-ITINGTOl'i H t:1-1 Dear Reed; IRVINE I.A HABRA I.A PAL'dA I.AGUNA HF'..AC:H 1.AGliN.\ lflu..-; 1.AGlJ~A NIGUEi I.AKE FORFST LOS AI.AMl'l'OS MISSION VIFJO NtWPOK'r 8~C:H ORANC:F. Thank you so much for arranging on short notice for Division President Laurann Cook and myself to meet with you and your members recently. We appreciate the opportunity to discuss this issue and answer questions. Thank you as well for your correspondence dated June 11, 1996 in which you provided some concerns and recommendations from an OCTax Committee convened to review the Council of Governments (COO) Joint Powers Agreement. Although the COG ~ officially formed, I believe that some of your points, specifically as they pertain to contracting and conflict of interest, can be addressed in the bylaws that wiU be developed once the COG formally convenes (scheduled foe August 15, 1996). Following is a response to the points made in your transmittal. 1'1./1.Ct."NTIA s~ c:r.EMENTF.t 1. OCTax Suggestion (Recitals, Paragraph C): Delete "planningt' or sAN 11/AN cM•1 · KANO define to exempt land use planning. The use o.f the word ~'planning" here has .SANTA MA no context with or relation to land use planning. The COG will be an advisory agency sr.Ai. a•:1oc.11 to ics members; it is not proposed generally or specifically anywhere in the JP A that ~•ANTI>N land use planning and/or decision-making will be a COG responsibility. Tl!STIN VII.J..A l'.\RK WF.S'l'MINSn:It YORBA I.INDA 2. OCTax Suggestion (Recitals, Paragraph F): Narrow recital to derme specific functions. Delete the words "and solutions". This recital, as is the case with recitals generally, is not intended to provide a specific listing of COO responsibilities. Such a list can be found as Exhibit I of the JPA. Rather, the .recital expresses a recogniz.ed need for improved coordination among governmental entities for addressing issues of common concern. Developing recommendations and solutions to identified problems should be the logical, practical result of such endeavors. I am sure developing solutions that could result in improved coordination and cost-savings among agencies is a goal common to both of our organizations. 3. OCTax Suggestion (Section 2.1, subsections b and c): The COG should abide by the provisions of the Public Contracts Code that require competitive bids. This could be an appropriate component of the COG's bylaws. which will be developed by the COG members . 4. OCTax Suggestion (Section 4.10): Expand the Section to protect again.:it conflicts of interesL This could be considered as the COG's bylaws are developed. 1'11:ESIDENT: UUl•M c, .. 1.. Cuuncil """"'""'· l'ity ui' Fuuomin V•ll,;y, fl~VICI! PR!!SIOEl'fT: W•lly l.ilm. 1m, .... Chy or L, ""'- ~E('OND \IIC.E PRE.SIDEPIT: Bu, Peny, M;y,.-. t"ily uo' Dn::a: PAST 1"111::.~IDliNT: Cb....t Sail&. M1,-.-. Clly n( w.,...,,,....,; STATli l.EA<'lU>c OI ECTOR: Run•kl a..,,, C'u•nnl Mcmla:t, 01~ 1•1 l.o, Al;amll, .. : RF-~m.UTION~ COMMI~ ~,&IRMAI<: Muy H,11•n1><III"-Cauoril -b:r, Ci17 1,r Cu:,I• Mesa: ()(TA R6PRE.~fNTAnVE, r,,., Wit..., •. M•r-Pm fuoo. Ci17 uf ,...,_ Nit•"'' fXliCt/TIVB DIUCT!lll; , ..... M. 11 ... .-. .. ,., \Hf.l\f IIRE.\ 111 ·r_',-\ PARK C:Ust.\ MESA ,:rPRt:.SS DA ..... ,\ POl:"IT FQt,;:....TAL"'J VALLEY n:LI.£RTO~ 1;ARDt:."i CROY~ Hl"~TI~GTO:\ 1· ~CH IRVl~E I.~ HABRA ~l'Al..'tfA L.Ac;l:!'lA B£,\C . l.AGL'NA HILLS' L\GU~A NIGUEL 1.hKE FOREST lDSAUMITOS M15SIONVIJ ~EWPORT 8 H ORASG& PLACENTU SAN Cu:ME.NT, :iAN JU!,N CAf'lSTRANO SA..~A ANA SEAL BEACH STAl'll'ON :;?J=,J YOR8A Ui'IDAl 791 P04 ...., \!/F~ r ~ I 'I. "P ~ 'I,~ ani 1.~, un \I ITE ;!, I ~ .. TA ...... 4 ('~l.11'011-.,~ ~i·,11 TELE?IIIJ\E • : .,-: ,.,~• ~ \'( ""• ,•:.·t1• Janice M. Mittenneier Chief Executive Officer County of Orange 10 Civic Center Plaza, 3rd Floor Santa Ana. CA 92701-4062 June l9, 1996 JUN 27 '96 14:46 Subject: County of Orange Comments re: Orange County Council of Govemrnenrs Dear Jan: It has been brought to my attention that at last week's Executive Management Committee meeting. after I left the room. you stated I bad not responded to your April 16, 1996 letter in which you raised questions regarding the Council of Governments (COO) proposal. I hope you recall tbe meeting held on April 17, 1996 at Fountain Valley Ciry Hall at which Division President Laurann Coo~ your staff member Kathleen Freed, you and I were in attendance. In confening with President Cook we agn:e that our recollection of that meeting is that, after extensive discussion of your concerns and issues. it was recognized that we would have to agree to disagree on the issue of the COG. President Cook and I promised to keep the lines of communication open and to demonstrate through action that the County of Orange could benefit from participation in the COG. Both President Cook and I left the meeting feeling we had· · made a substantial effort to respond to your concerns but realized that a difference of opinion existed abouc which, at this time, we could do nothing more. Subsequent to that date, Division Second Vice President Bev Pmry and myself also met with you and there have been at least two other meetings whcte we were both m attendance and the COG was discussed. I regret any misunderstanding on my part which led to my belief ~ the personaJ meeting with lbe President of the Division and myself and these other meetings were an adequate response to your April 16 letter. Please consider this letter and itS anachments my written reply. As noted above, the COO proposal has been carefully developed with the a.ssistacce of numerous City-elected officials, aecutive management and technical staff during the course of the last year, Like the County of Orange, Orange County cities also put forth considerable effort to addn!.ss the bankruptcy, and significant attentiqn has been fqcused on developing solutions to respond to the Cotmty's fiscal ~risis. Despite these pressing demands. during the last year Cities convened a Restructuring Supercommittcc comprised of City-elected officials to examine and make recommendations on a number of restructuring issues, including privatization and use of assets. a county charter, and a restructured system for the delivery of setVices to Orange County residents (this effort was modeled after the Division's Transportation Super Committee oftbe late 1980'sheaded up by then Santa Ana Mayor Dan Young). The Division. in September 1995, adopted che Supen:ommittee's report which included a recolll11le'ndation that a COG be established. A list of individuals who provided input to the Super Committee is attached. (As a follow-up to the recommendations of the Restructuring Supcrcom.minec, the Division's Executive Steering Committee. in developing itS arinuaJ Strategic Plan. identified the formation of a COO as one of its top ~AE.~IOE:f'T, 1..,......,ft Cuua, C1nin<d ~"'=•· C11J ,11 /i1uo1.w, Yall.;y; F1lS'I' VIO;; ~112SIOl!NT: W;lly U,,o, l•Ufl'f, Ci17 pr U P•IN; SE!COHO VIC£. ~RE!\JDEHT! 6,;.-. l'\:r,,, M.,,.-, l'u, uf 81n! PAST PRl!..SIDl!NT! 011tll J,oilh.. ,1,(1..,,. Ci,, .,f W-,t,aia.11a: ~ATIZ 1.£AQtl", IRECTOR1 R,-...hl 801<1. C,,,..,.,I M,,.t,,;, .. Chr nl' L" /\1.unl,.,.: A£,~IILIJTIIIIIS CllMMITTtE CNAIRM/lt,I; /ofary H.,,,.•...,•i.:. C°"l\o/il M.:mr-.,, Cicr ,,r ('u,c,, ,\r.,,_., IICTA P,fP!IESl!r<T"ATIVE.: T,,,. w11.,,n, M1y1111'ni Tom, Cle)' 1f L,,~-NiCIIIC~ EXECUTIVli DIIIECTOA: lllli:t M, H1111n& 791 Pffi JUN 27 '96 14:46 Response to Specific Comments Contained in Mittermeier Correspondence Comment: Response: Comment: Response: Corr,ment: Response: Comment: Response: 1ne role of the COG in restructuring discussions should be the subject of the restructuring effort, nor the forum for rhese activitie$, The current emphasis of the COG is to perform activities currently under the purview of the Regional Advisory and Planning Council. As such. the COG proposal is first seen as a way to improve on how RAPC activities h.a.ve been performed in the past. with an eye to improving Orange County's standing in the region in influencing the development of policy affecting all of the COG participams. Regarding the COG as a restructuring forum. it seems clear that if real "restructuring" is to occur in che County it must be accomplished with input from and reYiew by an number of interests, not from a single entity. The COG would provide an ideal forum in which such discussions should occur. What regi.orral pimu,ing will the COG engag~ in aml how will it coordinate with other regional plannirrg efforts? The COG proposal is to focus on six topical areas which arc for the most part currently performed by RAPC. As has been discussed for months. the identification of these activities was based on the fact that there is an immediare need for attention to be focused on them, no single agency focuses on them and that collective cost-savings can be achieved in coordinating staff resources to enrnine issues of mutual concern. Will IM COG puntu SCAG ngional planning grant funds for rransponanon in Orange County? . Funds cum:ntly provided by SCAG to Orange County, which are now used for a variety of projects under RAPC, have been identified as a source of funding for the COG. As an example. the COO proposal does not envision that the COG Will engage in ~portation planning. as that is a function cum::ntly performed at the subregional level by OCTA Transportation-related activities which may be outside the purview of OCT A but where OCT A might benefit from local input could logically be cxaminP1i through the COG. ls it the intent that the COG would pursiu pi4m,ing funds for use by the uniu of local guvemnumt that currently provith the urvices? How do we avoid competitive grant proposa.Ls from a new COG and regional service provider? · COG funding, as previously noted. will be provided in part through subregional allocations made available from SCAG. Orange County's objective is to utilize these funds in the most efficient manner possible, and it is anticipated mat the COG will provide a focal point for such 791 P08 JUN 2? '';;lb 14: 4"( meetings will be publicly noticed and participation and input will be encouraged. f2!!!!!! c Written Report C 0Yeftleads CSlides a Flip Charts (12): Summary Origin~tor a . 1 Department Head Sig treed Anticipated Time __ _ FINANCE, ADMINISTRATION AND HUMAN RESOURCES COMMITTEE AGENDA FOR JULY 10, 1996 Consideration of upcoming meetings and items to be discussed at those meetings. The calendar of future meetings is on the back of the Notice of Meeting each month. The next Finance, Administration and Human Resources Committee meeting is scheduled for Wednesday, September 11, 1996. 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. No meeting is currently scheduled. Consideration of Annual Review of the Districts' Investment Policy Consideration of RFP for Classification Studies Consideration of Commercial Bank Selection Consideration of Broker-of-record for Property and Personnel Insurances Consideration of Staff Report on Early Retirement Incentives· Consideration of Revisions to Purchasing Resolution Consideration of Staff Report on ABC Inventory System Consideration of Meet-and-Confer Process and Status Consideration of Purchase of LAN Server for Communication Consideration of Revised Personal Responsibility In Daily Effort (PRIDE} Program Consideration of Policy to Implement Cost Recovery for Information Requests Consideration of Employee Recognition and Wellness Program Consideration of Meet-and-Confer Process and Status Staff Recommendation Information only item. J:IWPOOCIFIN\CRANEIFPC.MTGIFAHR,96\COVERS.98\CALEN7.116