Loading...
HomeMy WebLinkAbout2005-06-08Minutes of the Finance, Administration and Human Resources Committee Meeting Page 2 June 8, 2005 (5) REPORT OF THE GENERAL MANAGER Blake Anderson, General Manager, recognized Nick Arhontes as the person to leau the new Regional Assets and Services Department that would be formed upon adoption of the FY05/06 budget. Mr. Arhontes reviewed the reasons for forming the department and the primary duties and responsibilities of the department. Mr. Anderson advised that he, along with Director Jim Silva and Lou Correa, would be in Sacramento the following week regarding SB 926 (Florez), to try to have the Assembly reject the bill. (6) REPORT OF DIRECTOR OF FINANCE/TREASURER Gary Streed, Director of Finance, had no report. Director Duvall expressed his appreciation to Mr. Streed upon his retirement from the District. (7) REPORT OF DIRECTOR OF HUMAN RESOURCES Lisa Tomko, Director of Human Resources, had no report. (8) REPORT OF DIRECTOR OF COMMUNICATIONS & ADMINISTRATIVE SERVICES Carol Beekman, Director of Communications & Administrative Services, discussed the renaming of the Communications & Administrative Services Department to the "Public Affairs Department". Ms. Beekman briefly reviewed the duties of a new division, Legislative Advocacy and Grants Division. She updated the Directors on an application that was submitted to FEMA for funds for the emergency repair of the SARI line. A determination for funding should be made by August. Ms. Beekman reported The Register did not publish the District's letter in response to an editorial on the user rate increase. Staff has set up a meeting with the editorial board for July 13. The letter will be revised and sent to other local papers for publishing. (9) REPORT OF GENERAL COUNSEL Brad Hagin, General Counsel, had no report. (10) CONSENT CALENDAR ITEMS a. Approve minutes of the May 11, 2005, Finance, Administration and Human Resources Committee meeting. b. FAHR05-46 Recommend to the Board of Directors to receive and file Treasurer's Report for the month of May 2005. c. FAHR05-47 Receive and file Certificates of Participation (COP) Monthly Report. d. FAHR05-48 Receive and file Employment Status Report as of May 16, 2005. Minutes of the Finance, Administration and Human Resources Committee Meeting Page 3 June 8, 2005 e. FAHR05-49 Receive and file OSHA Incidence Rates and Workers' Compensation Claims and Costs Report. f. FAHR05-50 Receive and file report of General Manager approved purchases in MOTION: amounts exceeding $50,000 in accordance with Board purchasing policies. It was moved, seconded and duly carried to approve the recommended actions for items specified as 10(a) through (f) under Consen~ Calendar. END OF CONSENT CALENDAR (11) ACTION ITEMS a. FAHR05-51 Recommend to the Board of Directors to approve proposed Operating, Capital, Debt/COP Service and Self-Insurance Budgets for 2005/06, as follows: Motion: Net Operations, Maintenance & Working Capital Worker's Compensation Self Insurance General Liability and Property Self-Insurance Net Capital Improvement Program Debt/COP Service $117,791,000 $591,000 $1,702,000 $277,111,000 $48,586,000 Director of Finance/Treasurer Gary Streed and Mike White, Controller, reviewed the basic elements of the proposed FY 05/06 Budget. Dave Ludwin, Director of Engineering, also reviewed the capital improvement program budget. Director Miller requested additional information on the impact of the capital improvement program to the user rates and the need for the projects be provided in the near future. It was moved, seconded and duly carried to recommend approval to the Board of Directors. b. FAHR05-52 Recommend to the Board of Directors to renew the District's Excess Motion: Workers' Compensation Insurance for the period July 1, 2005 through June 30, 2006, at a rate not to exceed $0.003993 of the actual payroll during this time period. Mike White, Controller, provided a brief report on the excess workers' compensation program. It was moved, seconded and duly carried to recommend approval to the Board of Directors. Minutes of the Finance, Administration and Human Resources Committee Meeting Page 4 June 8, 2005 c. FAHR05-53 Recommend to the Board of Directors to renew the District's Excess Motion: General Liability Insurance Program for the period July 1, 2005 through June 30, 2006, in an amount to be determined. Mike White, Controller, provided a brief report on the excess general liability program. He noted that the final premium costs are still being negotiated and should be finalized by the June 22nd board meeting. It was moved, seconded and duly carried to recommend approval to the Board of Directors. d. FAHR05-54 Recommend to the Board of Directors to renew the District's Boiler & Motion: Machinery Insurance Program for the period July 1, 2005 through June 30, 2006, in an amount not to exceed $23,753. Mike White, Controller, provided a brief report on the boiler and machinery insurance program. It was moved, seconded and duly carried to recommend approval to the Board of Directors. e. FAHR05-55 Recommend to the Board of Directors to renew the District's All-Risk Motion: Property and Flood Insurance Program for the period July 1. 2005 through June 30, 2006, in an amount not to exceed $586,527. Mike White, Controller, provided a brief report on the all-risk property and flood insurance program. It was moved, seconded and duly carried to recommend approval to the Board of Directors. f. FAHR05-56 Recommend to the Board of Directors to: (1) Adopt Resolution No. OCSD 05-_, authorizing the General Manager to adopt a Replacement Benefits Plan in compliance with County Employees Retirement Law of 1937; (2) Authorize the General Manager to delegate the administration of the Replacement Benefits Plan as he determines to be appropriate; and, (3) Authorize the General Manager to enter into a Memorandum of Understanding with Orange County Employees Retirement System for said Replacement Benefits Plan. Lisa Tomko, Director of Human Resources, reviewed the requirements of providing retirement pension limitations due to Internal Revenue Code Section 415(b) and establishing a replacement benefit plan that would assure payment of legally promised benefits under state law, and complies with tax law rules. Effective January 1, 2005, the indexed limit is $170,000 annually, and the amount is reduced on an actuarial basis for non-safety members who retire before age 62. Currently there is only one ROLL CALL FINANCE, ADMINISTRATION AND HUMAN RESOURCES COMMITTEE Meeting Date: June 81 2005 COMMITTEE MEMBERS Roy Moore (Chair) Mike Duvall (Vice Chair) Bill Dalton Richard Freschi Phil Luebben Darryl Miller Joy Neugebauer James W. Silva Steve Anderson (Board Chair) Jim Ferryman (Board Vice Chair) OTHERS Brad Hogin, General Counsel Don Hughes Robert Blum STAFF Blake Anderson, General Manager Time: 5:00 p.m. Adjourn: Carol Beekman, Director of Communications & Administrative Services David Ludwin, Director of Engineering Bob Ooten, Director of O & M Lisa Tomko, Director of Human Resources Gary Streed, Director of Financeffreasurer Patrick Miles, Director of Information Technology Robert Ghirelli, Director of Technical Services Mike White, Controller Penny Kyle, Committee Secretary Lilia Kovac, Assistant Board Secretary Nick Arhontes, Regional Assets & Services Manager c: Lenora Crane AGENDA REGULAR MEETING OF THE FINANCE, ADMINISTRATION AND HUMAN RESOURCES COMMITTEE (1) (2) ORANGE COUNTY SANITATION DISTRICT WEDNESDAY, JUNE 8, 2005, AT 5:00 P.M. ADMINISTRATIVE OFFICE 10844 Ellis Avenue Fountain Valley, California 92708 www.ocsd.com Agenda Posting: In accordance with the requirements of California Government Code Section 54954.2, this agenda has been posted in the main lobby of the District's Administrative offices not less than 72 hours prior to the meeting date and time above. All written materials relating to each agenda item are available for public inspection in the office of the Board Secretary. Items N0t P0sted: 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 because there is a need to take immediate action, which need came to the attention of the Committee subsequent to the posting of 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. Accommodations for the Disabled: The Board of Directors Meeting Room is wheelchair accessible. If you require any special disability related accommodations, please contact the Orange County Sanitation District Board Secretary's office at (714) 593-7130 at least 72 hours prior to the scheduled meeting. Requests must specify the nature of the disability and the type of accommodation requested. Items Continued: Items may be continued from this meeting without further notice to a Committee meeting held within five (5) days of this meeting per Government Code Section 54954.2(b)(3). Meeting Adjournment: This meeting may be adjourned to a later time and items of business from this agenda may be considered at the later meeting by Order of Adjournment and Notice in accordance with Government Code Section 54955 (posted within 24 hours). ROLL CALL APPOINTMENT OF CHAIR PRO TEM, IF NECESSARY Book Page 1 June 8, 2005 (3) PUBLIC COMMENTS All persons wishing to address the Finance, Administration and Human Resources Committee on specific agenda items or matters of general interest should do so at this time. As determined by the Chair, speakers may be deferred until the specific item is taken for discussion and remarks may be limited to three 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). (4) REP0RT QF COMMITTEE CHAIR (5) REPORT OF GENERAL MANAGER a. FAHR05-45 Formation of New Department: Regional Assets and Services (Book Page 15) (Nick Arhontes -10 minutes) (6) REPORT OF DIRECTOR OF FINANCE (7) REPORT OF DIRECTOR OF HUMAN RESOURCES (8) REPORT OF DIRECTOR OF COMMUNICATIONS & ADMINISTRATIVE SERVICES (9) REPORT OF GEN'ERAL COUNSEL (10) CONSENT CALENDAR ITEMS Consideration of motion to approve all agenda items appearing on the Consent Calendar not specifically removed from same, as follows: lAII matters placed on the consent calendar are considered 'as not r~qulring discussion or further explanation and [ i unless any particular item is requested to be removed from the consent calendar by a Director or staff member, l jthere will be no separate discussion of these items. All items on the consent calendar will be enacted by one ! \action approving all motions, and casting a unanimous ballot for resolutions included on the consent calendar. All l ! items removed from the consent calendar shall be considered in the regular order of business. ( ! i jThe Chair will determine if any items are to be deleted from the consent calendar. \ t ....................................... •······· ... -.... ---, ..... H .......... u •• u ............... ~ .... , ........... M ...... ,. ..................... _ ............ _ .... u ................... -... , •• H •••• H .. ,•,HOOOOf• ............... ,a•,o•-··•---··· ........ H .. ,o,,,, ••• _ ........................... •·. i a. Approve minutes of the May 11, 2005, Finance, Administration and Human Resources Committee meeting. 2 Book Page 2 June 8, 2005 b. FAHR05-46 Recommend to the Board of Directors to receive and file Treasurer's Report for the month of May 2005. The Treasurer's Report will be distributed at the FAHR Committee meeting in accordance with the Board-approved Investment Policy, and in conformance to the Government Code requirement to have monthly reports reviewed within 30 days of month end. c. FAHR05-47 Receive and file Certificates of Participation (COP) Monthly Report. (Book Page 29) d. FAHR05-48 Receive and file Employment Status Report as of May 16, 2005. (Book Page 35) e. FAHR05-49 Receive and file OSHA Incidence Rates and Workers' Compensation Claims and Costs Report. (Book Page 41) f. FAHR05-50 Receive and file report of General Manager approved purchases in amounts exceeding $50,000 in accordance with Board purchasing policies. (Book Page 47) END OF CONSENT CALENDAR Consideration of items deleted from Consent Calendar, if any. (11) ACTION ITEMS a. FAHR05-51 Recommend to the Board of Directors to approve proposed Operating, Capital, Debt/COP Service and Self-Insurance Budgets for 2005/06, as follows: Net Operations, Maintenance & Working Capital Worker's Compensation Self Insurance General Liability and Property Self-Insurance Net Capital Improvement Program Debt/COP Service (Gary Streed & Mike White -30 minutes) $117,791,000 $591,000 $1,702,000 $277,111,000 $48,586,000 (Book Page 49) b. FAHR05-52 Recommend to the Board of Directors to renew the District's Excess Workers' Compensation Insurance for the period July 1, 2005 through June 30, 2006, at a rate not to exceed $0.003993 of the actual payroll during this time period. (Mike White/Don McLean - 5 minutes) (Book Page 51) c. FAHR05-53 Recommend to the Board of Directors to renew the District's Excess General Liability Insurance Program for the period July 1, 2005 through June 30, 2006, in an amount to be determined. (Mike White/Don McLean - 5 minutes) 3 Book Page 3 (Book Page 55) June 8, 2005 d. FAHR05-54 Recommend to the Board of Directors to renew the District's Boiler & Machinery Insurance Program for the period July 1, 2005 through June 30, 2006, in an amount not to exceed $23,753. (Mike White/Don McLean - 5 minutes) (Book Page 61) e. FAHR05-55 Recommend to the Board of Directors to renew the District's All-Risk Property and Flood Insurance Program for the period July 1, 2005 through June 30, 2006, in an amount not to exceed $586,527. (Mike White/Don McLean - 5 minutes) (Book Page 69) f. FAHR05-56 Recommend to the Board of Directors to: (1) Adopt Resolution No. OCSD 05-_, authorizing the General Manager to adopt a Replacement Benefits Plan in compliance with County Employees Retirement Law of 1937; (2) Authorize the General Manager to delegate the administration of the Replacement Benefits Plan as he determines to be appropriate; and, (3) Authorize the General Manager to enter into a Memorandum of Understanding with Orange County Employees Retirement System for said Replacement Benefits Plan. (Lisa Tomko -20 minutes) (Book Page 71) (12) INFORMATIONAL PRESENTATIONS (13) CLOSED SESSION [ During the course of conducting the· business set forth on this agenda as a regular meeting of the. . l Committee, the Chair may convene the Committee in closed session to consider matters of pending real 1 estate negotiations, pending or potential litigation, or personnel matters, pursuant to Government Code !,,,,- j Sections 54956.8, 54956.9, 54957 or 54957.6, as noted. l Reports relating to (a) purchase and sale of real property; (b) matters of pending or potential litigation; (c) ! : employee actions or negotiations with employee representatives; or which are exempt from public disclosure 1 L under the California Public Records Act, may be reviewed by the Committee during a permitted closed l ! session and are not available for public inspection. At such time as final actions are taken by the Committee 1 I on any of these subjects, the minutes will reflect all required disclosures of information. I r ••··•• •• ••, •• O , •+ • ,,_, ........................ •-••-•• ................ UH ..... OH0~00 ... 00004 ... 0UO.O••·· •• ................. •-··--'-•u••··• .. oPOOHOUHOOOO••••••••H ................... --on'o•o•••·••• .... • ... HH0000···· .......... ,_UOO-HU OO-OO<OOn,.o; a. Convene in closed session. b. Reconvene in regular session. c. Consideration of action, if any, on matters considered in closed session. (14) OTHER BUSINESS, COMMUNICATIONS OR SUPPLEMENTAL AGENDA ITEMS. IF ANY 4 Book Page 4 June 8, 2005 (15) MATTERS WHICH A DIRECTOR MAY WISH TO PLACE ON A FUTURE AGENDA FOR ACTION AN:• .STAFF R'EPOHT (16) FUTURE MEETING DATES The next Finance, Administration and Human Resources Committee Meeting is scheduled for July 13, 2005, at 5 p.m. (17) ADJOURNMENT r•,.« ... ••·~·----·······••u ......................................... ~····· .. ·······~· .. ·······-···--············ .. ·······•··· .. ··········•·u··· .. ·•u••· .. ···•· ..... u ............ , ........................... -.......................................................................... ; I Notice to Committee Members: j ·: : j For any questions on the agenda or to place any items on the agenda, Committee members should contact the ! \Committee Chair or Secretary ten days in advance of the Committee meeting. ! : t lcommittee Chair: Roy Moore (714) 990-7703 j jcommittee Secretary: Penny Kyle (714) 593-7130 pkyle@ocsd.com ! !General Manager Blake Anderson (714) 593-7110 banderson@ocsd.com j \Director of Finance Gary Streed (714) 593-7550 gstreed@ocsd.com i i rnrector of Human Resources Lisa Tomko (714) 593-7145 ltomko@ocsd.com I iDirector of Communications & Carol Beekman (714) 593-7120 cbeekman@ocsd.com I lAdministrative. Services···············-·············-·········-··········-·······················-·······-···········-··········-··-····-····-······-····-··-·······················-·······-················-·-·········-······· I H:\dept\agenda\FAHR\FAHR2005\0605\01.3.FAHR Agenda.doc 5 Book Page 5 MINUTES OF FINANCE, ADMINISTRATION AND HUMAN RESOURCES COMMITTEE MEETING Orange County Sanitation District Wednesday, May 11, 2005, 5:00 p.m. A meeting of the Finance, Administration and Human Resources Committee of the Orange County Sanitation District was held on May 11, 2005, at 5:00 p.m., in the District's Administrative Office. (1) The roll was called and a quorum declared present, as follows: FAHR COMMITTEE MEMBERS: DIRECTORS PRESENT: Roy Moore, Chair Bill Dalton Rich Freschi Phil Luebben Darryl Miller James W. Silva DIRECTORS ABSENT: Steve Anderson, Board Chair Jim Ferryman, Vice Board Chair Mike Duvall, Vice Chair Joy Neugebauer OTHERS PRESENT: Brad Hogin, General Counsel Ed Soong, Financial Advisor Randy Fuhrman STAFF PRESENT: Blake P. Anderson, General Manager Gary Streed, Director of Finance/Treasurer Lisa Tomko, Director of Human Resources David Ludwin, Director of Engineering Bob Ooten, Director of Operations & Maintenance Mike White, Controller Jeff Reed, Human Resources Manager Jim Herberg, Engineering Manager Juanita Skillman, Records Management Specialist Sonja Wassgren, Public Information Specialist Penny Kyle, Committee Secretary Lilia Kovac, Assistant Board Secretary (2) APPOINTMENT OF CHAIR PRO TEM No appointment was necessary. (3) PUBLIC COMMENTS Randy Fuhrman encouraged the Directors to increase user fees to the maximum allowable for 2005/06 in order to reduce the dollar amount that would need to be borrowed. He reminded the Directors that an increase of 15% would only replace the amount being taken by the State for this year and next year. (4) REPORT OF THE COMMITTEE CHAIR Committee Chair Moore had no report. BookPage 9 Minutes of the Finance, Administration and Human Resources Committee Meeting Page 2 May 11, 2005 (5) REPORT OF THE GENERAL MANAGER Blake Anderson, General Manager, reported that SB926 (Florez) has been approved by the California Senate, and the Assembly will now address it. This bill would allow Kern County to ban the use of the District's biosolids. Staff is working towards defeating the bill. Senator Florez has also introduced a new bill, SB120, which would require the State Water Resources Control Board, in coordination with other regulatory agencies, to conduct a study on management options of biosolids, as well as monitoring and indemnification provisions. Staff is in support of SB120. Mr. Anderson advised he had met the prior week with Kern County Supervisor Ray Watson regarding groundwater contamination and Kern County's concerns. A small portion of the groundwater supply lies under a corner of the Tule Ranch property that is used for the District's biosolids. Meetings will continue to be held to discuss possible solutions to this issue. It was also reported that the local Electrical Union has been attempting to contact the Board of Directors regarding allegations against Helix Electric, Inc., a subcontractor for J.F. Shea, the low bidder for the Headworks Replacement at Plant No. 2, Job No. P2-66. The Engineering Department is investigatin~ the alle_gations and will provide a report of their findings to the Board of Directors at the May 251 board meeting. Dave Ludwin, Director of Engineering and Jim Herberg, Engineering Manager, were then recognized who gave an overview of the Capital Improvement Program (CIP). The CIP includes over 120 projects and is composed of four major components: collections system rehabilitation; treatment plants rehabilitation/upgrades; secondary treatment upgrades; and additional capacity. Directors entered into a brief discussion regarding the pending user rate increase, and the justification to increase the rates to $151 annually. (6) REPORT OF DIRECTOR OF FINANCE/TREASURER Gary Streed, Director of Finance, referred the Directors to three items distributed that evening: Treasurer's report, a spreadsheet regarding the Operations & Maintenance budget items, and a copy of that evening's power point presentation by Ed Soong of Public Resources Advisory Group. (7) REPORT OF DIRECTOR OF HUMAN RESOURCES Lisa Tomko, Director of Human Resources, did not make a report. (8) REPORT OF DIRECTOR OF COMMUNICATIONS & ADMINISTRATIVE SERVICES Carol Beekman, Director of Communications & Administrative Services, was not present. Book Page 10 Minutes of the Finance, Administration and Human Resources Committee Meeting Page 3 May 11, 2005 (9) REPORT OF GENERAL COUNSEL Brad Hogin, General Counsel, reported on AB528, which would allow the citizenry to sue for water act violations. CASA is working towards defeating the bill. (10) CONSENT CALENDAR ITEMS Director Miller requested Item 1 O(b) be pulled from the Consent Calendar for consideration separately. a. Approve minutes of the April 13, 2005, Finance, Administration and Human Resources Committee meeting. b. FAHR05-35 Item pulled for discussion. c. FAHR05-36 Receive and file Certificates of Participation (COP) Monthly Report. d. FAHR05-37 Receive and file Employment Status Report as of April 18, 2005. e. FAHR05-38 Receive and file OSHA Incidence Rates and Workers' Compensation Claims and Costs Report. f. FAHR05-39 Receive and file SWAP Report for the quarter ended March 31, 2005. g. FAHR05-40 Recommend to the Board of Directors to receive and file the 2004/05 Third Quarter Financial Report for the period ending March 31, 2005. h. FAHR05-41 Recommend to the Board of Directors to receive and file Quarterly Investment Management Program Report for the period January 1, 2005 through March 31, 2005. i. FAHR05-42 Receive and file report on clarification of the use of a single insurance MOTION: broker of record. It was moved, seconded and duly carried to approve the recommended actions for items specified as 10(a), and (c) through (i) under Consent Calendar. END OF CONSENT CALENDAR Book Page 11 Minutes of the Finance, Administration and Human Resources Committee Meeting Page4 May 11, 2005 b. FAHR05-35 Recommend to the Board of Directors to receive and file Treasurer's MOTION: Report for the month of April 2005. Clarification was requested regarding conflicting information between the PIMCO report and that month's Treasurer's Report. Gary Streed, Director of Finance, advised the PIMCO report was based on the last quarter (January, 2005 -March 2005), and the Treasurer's Report included information through April 2005. It was moved, seconded and duly carried to recommend to the Board of Directors to receive and file the Treasurer's Report for the month of April 2005. (11) ACTION ITEMS a. FAHR05-43 Direct staff and Public Resources Financial Group to proceed with plans MOTION: for a 2005/06 COP issue that incorporates the features of both variable and fixed rate borrowing in order to take advantage of the current low rates and the shape of the yield curve and to minimize interest costs and risks. Gary Streed introduced Ed Soong of Public Resources Advisory Group. Mr. Soong reviewed the financing options for fixed and variable rates of issue, and the District's outstanding debt profile. It is currently anticipated the District will issue $200 million in certificates of participation for 2005/06. Mr. Streed responded to Directors' questions and advised he would be bringing this issue back to the Committee in the next few months. It was moved, seconded and duly carried to approve the recommended action. (12) INFORMATION PRESENTATIONS a. FAHR0S-44 FY 2005/06 Proposed Material, Supplies & Services Operating & Maintenance Budget Items Mike White, Controller, presented the proposed Material, Supplies & Services Operating & Maintenance budget items. He referred the Directors to a handout that listed line items for this portion of the budget. Directors requested additional information for the increase for postage and reproduction costs be provided to them. (13) CLOSED SESSION There was no closed session. Book Page 12 FAHR COMMITTEE Meeting Date 06/08/05 AGENDA REPORT Item Number FAHR0S-45 Orange County Sanitation District FROM: Blake Anderson, General Manager SUBJECT: Formation of New Department: Regional Assets and Services GENERAL MANAGER'S RECOMMENDATION Information Only SUMMARY To Bd. of Dir. Item Number As part of the FY 2005-06 budget process moving forward for approval by the FAHR Committee and by the Board of Directors, I am proposing a new department called Regional Assets and Services. It is a reconfiguration of two existing divisions within the Operations and Maintenance (O&M) Department. The proposal is in keeping with our long range work plan, our Unifying Strategies and will support our customer cities and sewering agencies. No additional staffing is recommended for establishing the department. The two divisions we are melding into a department are Regional Assets and Services which primarily focuses on sewer system operations and maintenance issues; the other division is Facilities Maintenance Services which deals with mobile assets such as cars, trucks, and specialty rolling equipment. Both divisions currently report to the same manager who reports to the Director of O&M. This change will have the current manager reporting to me. No backfilling of the manager's position is included in the proposed budget. The department will report through the OMTS Committee to the Board. This change will give the regional and local sewer system operations, maintenance and regulatory-related activities of this group direct review and access to the EMT and the General Manager. Over the last few years we have seen significant changes in the regulatory climate as well as citizen's lawsuits affecting the sanitary sewer systems planning, operations, maintenance and renewal. These changes have driven us towards broader watershed-based collaborative strategies as compared to isolated sewer systems. The weekly EMT meetings will have regional sewer policy and strategy as part of the mix of issues regularly addressed. Why is this important? H:ldepl\agenda\FAHRIFAHR2005\0605\05-45.Regional Assets doc Revised: 06/04/03 Page 1 Book Page 15 The Sanitation District's current role in urban runoff today consists of accepting approximately 2 million gallons per day of dry weather diversions without cost from 12 locations in Fountain Valley, Huntington Beach, and Newport Beach. If fees are eventually imposed on property owners to pay for this service, then many more new diversion locations will be proposed by others. This group will help manage this evolving practice. As new regional projects are identified, it is very likely that the technical expertise of the Sanitation District will be part of the effort. The Sanitation District may take a subordinate or lead role in these regional projects. Our role will be decided later by deliberation of our own board and the expressed preferences of other governmental bodies. A likely scenario is that several cities, the Sanitation District and the County will form project management agreements that result in new systems that are designed, constructed and maintained. Those projects with a dry weather urban runoff diversion element to them will absolutely require our time and attention to make certain they operate as they are intended and do not cause unintended impacts on our very large and dynamic regional wastewater treatment system . The time is now to begin to prepare for this eventuality by establishing our own institutional infrastructure so that we can competently respond to the changes that are coming our way. Not only will we provide the equipment and systems, but also the training, staff development, and business practices to lower costs and achieve reliability, compliance and sustainability. PRIOR COMMITTEE/BOARD ACTIONS Information was presented on 3/9/05 thru FAHR05-19 Also as relates to the Urban Runoff component: 1. Adoption of Urban Runoff Diversion Policy September 27, 2000 2. Policy amended March 28, 2001 to modify indemnity language PROJECT/CONTRACT COST SUMMARY This proposed change will be budgeted for FY 2005-06. The additional annual cost for the first year is expected to be approximately $15,000 for the reclassification of 2 position(s) and a staff increase of O FTE. In the future, when additional sewer management and urban runoff management services are requested of the Sanitation District, new revenue from fees will be needed to pay for them. Close collaboration with the cities, sewering agencies and the county will occur. Staff predicts that new fees will be levied in the future to pay for urban runoff related services. H:ldeptlagenda\FAHRIFAHR2005\0605\05-45 Regional Assets.doc Revised: 06/04/03 Book Page 17 Page 3 BUDGET IMPACT 1Z1 This item has been budgeted. (Line item: in FY 05/06 Operating Budget) D This item has been budgeted, but there are insufficient funds. D This item has not been budgeted. D Not applicable (information item) ADDITIONAL INFORMATION OCSD's Regional Role in the Regional Board's WDR Order Compliance Effort OCSD staff has taken a leadership role in establishing and coordinating a monthly Steering Committee meeting consisting of staff from several member agencies. This was done in response to the following WDR paragraph: "Since most of these dischargers are tributary to the Orange County Sanitation District (OCSD), the OCSD may lead a steering committee for all other entities tributary to OCSD, to facilitate compliance by each discharger with the requirements of this Order." OCSD has also coordinated meetings and workshops, set agendas and kept meeting summaries for monthly WDR general meetings with all member agencies and interested parties during the development of their WDR Sewer System Management Plans (SSMP). OCSD is using its internet web site for posting information accessible to all co- permittees, where we archive all of our WDR-related documents, meeting summaries, and WDR deliverables. Final copies of SSMP deliverables are sent to the RWQCB and are also placed on OCSD's web site for public access. WDR Deliverables and Schedule The following table shows the co-permittees collaborating on the WDR compliance effort. Military agencies have attended a few of the monthly meetings but we are unaware of their actual progress towards compliance. City of Anaheim City of Brea City of Buena Park Costa Mesa Sanitary District City of Cypress City of Fountain Valley City of Fullerton Garden Grove Sanitary District City of Huntington Beach H:ldepl\agenda\FAHR\FAHR2005\0605105-45 Regional Assets doc Revised: 06/04/03 City of Newport Beach City of Orange City of Placentia Rossmoor/Los Alamitos Area Sewer District City of Santa Ana City of Seal Beach City of Stanton Sunset Beach Sanitary District County of Orange Unincorporated Area 7 and a portion of the City of Page 4 Book Page 18 Tustin (OCSD locally owned sewer systems) City of La Palma City of Villa Park Irvine Ranch Water District City of Yorba Linda City of La Habra Yorba Linda Water District Orange County Sanitation District Midway City Sanitary District (OCSD) (Regional System) Marine Corps Air Station El Toro El Toro Water District -non OCSD I RWD? Future sewers satellite U.S. Air Force Reserve Center Joint Forces Training Base Los Los Alamitos Alamitos Naval Weapons Station Seal Beach The time schedule for all WDR Sewer System Management Plan deliverables is shown below. OCSD has met all of our deliverable deadlines to date (shown in bold Italics) and will continue to do so throughout the development of the SSMP. Sewer System Management Plan Time Schedule Task Completion Date Monitoring and Reporting Program No. RB-2002-This became effective on April 26, 2002 in 0014 compliance with the new Sanitary Sewer Overflow (SSO) Monitoring and Reporting requirements Submit SSMP Development Plan and Schedule September 30, 2002 Submit SSO Emergency Response Plan January 1, 2003 Submit Preventative Maintenance Program June 15~ 2003 Legal Authority December 30, 2004 Grease Disposal Alternatives December 30, 2004 Grease Control Program December 30, 2004 Complete Capacity Evaluation July 30, 2005 Complete Sewer Rehabilitation Plan for Entire September 30, 2005 System Submit Final SSMP September 30, 2005 OCSD staff publishes and distributes draft versions (or outlines) of WDR deliverables for co-permittee use in developing their site-specific deliverables. These are furnished at low or no cost. OCSD has absorbed the consulting costs to help develop certain products as part of its program . Funding has only been requested on two occasions: for the development of the FOG communications BMP tool kit and the FOG Control Program development effort. OCSD staff is also working with the County of Orange on an improved method to capture sewage spills in the County's flood control channels. More information on this pilot project will be available after June 2005. H:ldepllagenda\FAHRIFAHR200510605\05-45.Regional Assets doc Revised: 06/04103 Book Page 19 Page 5 In addition, OCSD is funding research and development of a WDR-required methodology to accurately estimate the extent of subsurface leakage from sewers. OCSD's consultant, Brown and Caldwell, along with UC Irvine have done this research and development. Outcomes of this work are expected to be available during the summer of 2005. A stakeholder involvement process was used. FOG Control Program Development The development of the Fats, Oils and Grease (FOG) Control Program was a major deliverable required by the WDR, and was led by the Source Control Division in collaboration with staff from many cites and agencies. The 12 building blocks of an effective FOG control program can be applied locally and regionally. The building blocks are programmatic, use best management practices and best available technologies. The California Restaurant Association has been supportive of our approach. The 12 building blocks are considered fundamental to each program. Our FOG control program focuses on the smaller diameter local sewers that we own in the older part of the City of Tustin as well as the unincorporated areas north of Tustin (including unincorporated islands in the El Modena area of the City of Orange). We feel that as the cities and agencies implement their FOG control programs, grease loadings on the regional system will diminish, thus lessening our maintenance needs in some areas. Phase 11 of the FOG Control Study is underway and partially funded thru an SWRCB Grant. Phase II of the study involves field testing of FOG control technologies such as biological additives, innovative grease removal equipment, and grease interceptor sludge and grease-level monitoring devices. The FOG Communications Program efforts were led by our Communications staff and a city/agency team. This innovative approach provided a FOG Tool Kit to each funding participant. The contents are easily modified within our communities as necessary. Other Important OCSD Regional Activities • OCSD has installed an SSO demonstration training facility at Reclamation Plant No. 1. We will make this facility available to our member agencies for training under OCSD's leadership until member agency staff can be trained in its operation. • Our Inflow/Infiltration (l/1) Reduction Cooperative Projects Program in cooperation with the Engineering department continues to provide financial assistance to our member agencies for sewer rehabilitation projects and related investigative efforts. Matching funds of up to 50% were made available for qualifying projects. Awards of funds for new projects are on hold pending completion of existing projects and our new Flow Modeling Project. H:\depl\agenda\FAHR\FAHR2005\0605\05-45.Regional Assets doc Revised: 06/04/03 Book Page 20 Page 6 • OCSD is completing the seventh year of our City and Agency Collection Facilities O&M Outreach Program and Survey. This program provides a valuable regional information exchange document that is an important networking and research tool. • OCSD shares our contract specifications for small diameter sewer-line cleaning, pipe relining, manhole coating services and CCTV work and prices when requested. This assists other agencies in further developing such programs when using contract services. • OCSD provides test preparation classes for California Water Environment Association (CWEA) exams for Collection System Maintenance Technologist certification. The RWQCB staff recognizes this certification as a validated program to improve and measure staff and contractor competency. Cities and agencies are recognizing that staff development and improved training are becoming more important in developing the future workforce. • OCSD is producing a video on medium and large-diameter pipe cleaning methods for distribution to city and agency staff as a training and information tool. • OCSD has assisted Huntington Beach, La Habra, and Cypress with medium-sized pipe cleaning. Discussions are beginning with IRWD staff. Our staff knowledge, methods and equipment for medium-sized pipe cleaning are unique on a national level. About 200 miles of city and sewering agency owned pipe fall into this size category in addition to the 475 miles operated by OCSD. A business case will also be developed. • Staff fields routine questions weekly from cities, agencies and their consultants regarding sewer O&M, repair and rehab issues. • OCSD has participated with LAFCO, the County of Orange, the RWQCB, USEPA, AMSA, CASA, TriTAC, CalFOG, SCAP and South County sewering agencies, along with statewide and national agencies regarding sewer system issues. • OCSD staff continues to monitor the progress of EPA's proposed spill reduction strategies since the SSO Rule "cMOM" was placed on hold in January 2001 . • OCSD staff continues to be involved with the American Society of Civil Engineers in coordinating the 2005 Orange County Infrastructure Report Card effort for wastewater treatment plants and collection systems countywide. • We are currently participating in the State Water Resources Control Board's new regulatory effort to reduce spills and improve operations and management of the crucial facilities as a member of the statewide SSO Guidance Committee. H :ldeptlagenda\FAHRIF AHR2005\0605\05-45, Regional Assets.doc Revised: 06/04/03 Book Page 21 Page 7 • We are testing a biodiesel fuel in three of our service trucks. This fuel is made from waste greases and oils from restaurants in our service are. • We are evaluating several industrial sites in north and central Orange County to relocate Regional Assets and Services staff and maintenance shops. This will increase business efficiencies and free up needed space at Plant No. 2 for process and O&M staff needs. This would also allow us to support regional meetings, workshops and training at a more centralized location. OCSD Leadership and Collaboration Plans OCSD will continue to be a leader in advocating and developing programs to reduce life-cycle costs, increase levels of service, and improve system reliability. We will continue to share our expertise with the cities and sewering agencies we serve. Preliminary ideas for the future are an OCSD-based Regional Services Group covering daily sewer and other equipment and facility care needs. This group could directly assist existing city and agency teams. OCSD could develop, provide and manage a "cafeteria" type service plan for member cities and agencies to use as needed covering, at a minimum: • Maintenance consulting services to leverage regional knowledge • Training to improve knowledge, skills and abilities (K,S,A) of current and future workforces for improved regulatory compliance and work practice efficiencies • Support on odor and corrosion assessments • Sharing District knowledge base after completion of the staff driven business practices reinvention effort • Rehabilitation and repair planning for cost efficiencies • Mutual aid support and coordination in emergencies • Maintenance and repair contractors, and material suppliers for cost efficiencies • Regional Geographic Information System (GIS) on sewer information • Integrated Flow Modeling • Optimizing regional sewer cleaning coordination/frequencies by better coordination with member cities and sewering agencies • Improved coordination on OCSD Capital Improvement Projects (CIP) for overall sewer capacity increases • Regionalizing medium and large diameter (15" and larger) sewer inspection and cleaning for improved service • Cooperative support in the direct daily management and direct O&M labor if needed • Improved support on the various air, land, and water regulatory issues where OCSD has expertise. • City/sewering agency "piggybacking" on OCSD purchase agreements (Board approval of a revised purchase resolution may be needed) • Leveraging "lessons learned" from the staff-driven business practice reinvention efforts and providing these results to the cities and agencies H:ldeptlagenda\FAHRIFAHR2005\0605\05-45 Regional Assets doc Revised: 06/04/03 Book Page 22 Page 8 • Accommodation of urban runoff flows for transport, treatment, and disposal to reduce shoreline bacteria • A pilot project to produce a biodiesel fuel from local waste greases and oils • Sharing lessons learned from the OCSD leadership development, succession planning and other human factors programs • A clearinghouse concept to evaluate chemicals, compounds and other products that are used or wind up in the sewer system and reclaimable water supplies A "cafeteria-type" service plan would allow customers to pick and choose the type and level of support desired for services as an example. Future Board action items are anticipated in some of these areas related to staffing needs and services. Dry Weather Runoff The Sanitation District first became involved in accepting dry weather urban runoff diversions in September 1999. We voluntarily took this unprecedented action when it became clear, from scientific evidence, that the beach closures and postings occurring in Huntington Beach were the direct result of contaminated urban runoff reaching the shoreline through the Talbert Channel, the Santa Ana River, and other sources. The only timely and effective measure available to improve the situation was for the Sanitation District to allow cities like Huntington Beach to divert dry weather low flow contaminated urban runoff from storm channels and local stormwater pump stations into sanitary sewers that flow to us. The improvement was dramatic, instantaneous and lasting. In the future many more projects will be proposed to manage the continuing problem of contaminated dry weather urban runoff from reaching inland fresh water streams and coastal marine waters. These projects will have to be identified, prioritized, designed, constructed, operated, maintained and monitored. Who will be responsible has yet to be decided. Who will pay for it or raise the money to pay for it has yet to be decided. In any case, the Sanitation District will be placed in a position of helping manage the problem of contaminated dry weather urban runoff by accepting increasingly larger amounts of flow. The County Board of Supervisors is addressing the issue of institutional arrangements and decision making now. Over the next several months it is likely that they will propose a way for the County, the cities, and special districts to work together using existing staff and existing physical assets. We will share responsibilities and work together in an orderly manner. The Board of Supervisors is also considering the question of fees to pay for the capital and operating costs associated with a county-wide approach to managing dry weather urban runoff. There are several options that could be considered including a Proposition 218 election similar to what the Vector Control District successfully implemented last year. H:\deptlagenda\FAHRIFAHR2005\0605\05-45 Regional Assets doc Revised: 06104103 Book Page 23 Page 9 A group of managers from the County, cities and special districts (including the Sanitation District) are meeting to provide input to the Supervisors. This process and the recommendations that are emerging reinforce what our own Sanitation District ad hoc committee on urban runoff has been discussing during the last year. While the exact outcome of these deliberations by the County Board of Supervisors is yet to be known, one thing is clear: because of the regulatory pressures exerted by the Regional Water Quality Control and the rising expectation of the public and businesses to have reliably clean and swimmable beaches, there will be new arrangements in this County fairly soon. It is for this reason that the Sanitation District must be ready to respond to the arrangements as they become clear. The first step is to have a clear way to consider these changes and then bring them appropriately and efficiently into the organization. ALTERNATIVES None foreseen based on the current regulatory climate and state, regional and local issues needing focused attention by the General Manager and the District. CEQA FINDINGS Not applicable at this time. Future capital projects, if initiated by the Sanitation District, would trigger CEQA requirements at some time in the future. ATTACHMENTS Organizational Changes (org. chart) Letter from State Water Resources Control Board H:ldeptlagenda\FAHRIFAHR2005\0605105-45.Regional Assets.doc Revised: 06/04/03 Book Page 24 Page 10 Public Affairs Public Affairs Current Organization HR& Employee Develo . Finance Board of Directors General Manager Info. Tech. General Counsel O&M Technical Services Admln1stratlon Regional Assets & Services Facilities Maint Services Process Engrg. & GIP Support Plant 1 Ops Plant2 Ops Mech. Maint. & Power Production Elec. & Inst. Maintenance Proposed Organization Regional Assets & Services HR& Employee Develo Administration Regional Assets & Services Facilities Maint Servic.es Board of Directors General Manager Finance Info. Tech. General Counsel O&M Technical Services Administration Process Engrg. & GIP Support Plant 1 Ops Plant2 Ops Mech. Maint & Power Production Elec. & Inst. Mainlenanc.e Engrg. Engrg. H:ldeptlagenda\FAHRIFAHR2005\0605\05-45,Regional Assets doc Revised: 06104103 Page 11 Book Page 25 FAHR COMMITTEE AGE NDA RE PORT Orange County Sanitation District FROM: Gary G. Streed, Director of Finance Originator: Michael D. White, Controller -Meeting Date To Bd. of Dir. 06/08/05 Item Number Item Number FAHR0S-47 SUBJECT: CERTIFICATES OF PARTICIPATION (COP) MONTHLY REPORT -MAY 2005 GENERAL MANAGER'S RECOMMENDATION Receive and file Certificates of Participation (COP) Monthly Report for the month of May 2005. SUMMARY The District began issuing Certificates of Participation (COPs) on a variable interest rate basis in 1990. These variable rate COPs were a part of our long-term financing plan which also included some more traditional fixed rate borrowing. In 1992 and 1993, some of the fixed rate COPs were refunded and replaced with synthetic-fixed rate COPs. These are variable interest rate COPs that are also subject to a long-term fixed-rate interest exchange agreement (SWAP). The SWAP provides the maximum interest rate to be paid by the District, and is less costly than traditional fixed rate borrowing. In August 2000, the entire financing program was restructured and modernized to incorporate and take advantage of the consolidation of District books of account and revenue structure. This process has reduced the number of COP issues from five to three; 1992 Refunding COPs, 1993 Refunding COPs and 2000 Refunding COPs. The 2000 COPs can be divided into Series A and Series 8, if additional remarketing agents are desired. In August 2003, the District issued $280 million of fixed rate COPs, Series 2003, that have varying coupon rates that are matched against the varying maturity dates. The true interest cost for the entire issue is 5.15 percent. Variable interest rate COPs can be put back on the market by the buyer each day. When this happens, they must be remarketed or sold to another buyer. This process, called remarketing, is generally provided by a municipal bond underwriter. The remarketing agent sets the interest rate they believe is required to sell the COPs. Some issuers believe that having more than one remarketing agent promotes competition and results in lower interest costs. Staff has monitored variable interest rate issues of other agencies since the inception of our program. The attached charts are described in the "Additional Information" section of this agenda report. They are provided monthly to compare our actual interest rates to a composite index, and to other selected issuers of similar credit quality, and with COP issues of similar amounts. Many variables affect interest rates, but staff expects our rates to be among the lowest. PRIOR COMMITTEE/BOARD ACTIONS N/A Book Page 29 PROJECT/CONTRACT COST SUMMARY N/A BUDGET IMPACT D This item has been budgeted. (Line item: ) D This item has been budgeted, but there are insufficient funds. D This item has not been budgeted. [8] Not applicable (information item) ADDITIONAL INFORMATION The first graph entitled, "OCSD COP Rate History Report," shows the actual variable interest rates paid 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 "swap." The second bar chart entitled, "Comparative Daily COP Rate History Report," shows the performance of the District's Daily Rate COPs as compared to a composite index rate, which represents the average rate of six similar variable rate daily reset borrowings. The third bar chart entitled, "COP Rate History, Comparison of Highest & Lowest Rates," compares the performance (monthly average interest rate) of the District's Daily Rate COPs with the highest and lowest monthly average rates from among six similar variable rate daily reset COPs. The table entitled, "COP Rate History, Comparison of Monthly Averages," shows the monthly variable interest rate performance of the District',::; Daily Rate COPs as compared to the composite index. Estimated annual interest payments calculated for a standard $100 million par amount, are also shown. Variable rates historically rise at the end of each calendar quarter, and especially at year-end, because of business taxes and liquidity requirements. The rates tend to decline to prior levels immediately in the following month. Staff maintains continuous rate monitoring and ongoing dialog with the remarketing agents to keep the Committee fully informed about developments in the program as they may occur. ATTACHMENTS 1. Graph -OCSD COP Rate History Report 2. Graph -Comparative Daily COP Rate History Report 3. Graph -COP Daily Rate History, Comparison of Highest & Lowest Rates 4. Tabular -COP Rate History, Comparison of Monthly Averages GGS:MW:lc H:\dept\agenda\FAHRIFAHR2005\0605105-47 COP doc Revised: 06/04/03 Book Page 30 Page 2 l J go 'ABI/\I l l ~ go 'Jd'v' 0 D. I -w a:: go 'JBI/\I > I a:: 0 I go 'qa.::1 ~ I-I 0 I ~ UJ w -I-:c I in go'uer 0 a.. w l :ii I 0 I-(J Lt) • ~ 0 l vo'oaa 0 l C C N C D. J N -g 0 ~ ca l C") o ca vO 'r.ON 9> >:i I -~ l GI rn ...J a.. -0 I (J <C vO 'lOQ 0 l rn C (J I 0 w • > I VO 'das -I I-~ j I vo'6nv <C I Q. :i 0 I vo '1nr 0 vo 'unr I 0 0 0 0 0 ~ ~ w 0 ~ ~ ~ C") N ..... 0 I- (%)31.~ ~ Book Page 32 0:, 0 0 ;,;- '"O ~ (1) l.,J .;,. Jun-04 Jul-04 Aug-04 Sep-04 Oct-04 Nov-04 Dec-04 Jan-05 Feb-05 Mar-05 Apr-05 May-05 AVERAGE ESTIMATED ANNUAL INTEREST PAYMENTS PER $100M PAR AMOUNT $ •FOOTNOTE DAILY COP RATE HISTORY COMPARISON OF MONTHLY AVERAGES JUN 2004 -MAY 2005 OCSD $218.6M $46M Series 2000 Series 93 Ref Composite PaineWebber PaineWebber Index• 1.02 1.02 1.00 0.99 0.99 0.97 1.15 1.15 1.13 1.34 1.34 1.32 1.67 1.67 1.65 1.52 1.52 1.51 1.55 1.55 1.54 1.70 1.70 1.69 1.76 1.76 174 1.86 1.86 1.84 2.42 2.42 2.40 2.88 2.88 2.87 1.66% I 1.66% 1.64% 1,655,000 I s 1,655,ooo I $ 1,638,333 Composite index consists of the following COP transactions: . IRWD, Series 86-COP, 88, 95, $106.1M, Citigroup . IRWD, Series C-Ref 93-B, 85-B, $62.1 M, Lehman Brothers . IRWD, Series 91, 93, 85, $93.0M, PaineWebber . IRWD, Series 89, C-Ref 93-A, C-Ref 95, $70.9M, Merrill Lynch . Western Riverside Co. Reg. Wastewater Auth., Series 96, $25.4M, PaineWebber . Orange Co., Irvine Coast Asst. Dist. 88-1, $94.5M, J.P. Morgan FAHR COMMITTEE Meeting Date To Bd. of Dir. 06/08/05 AGENDA REPORT Item Number Item Number FAHR0S-48 Orange County Sanitation District FROM: Lisa L. Tomko, Director of Human Resources Originator: Lisa Arosteguy, Human Resources Supervisor SUBJECT: EMPLOYMENT STATUS REPORT AS OF MAY 16, 2005 GENERAL MANAGER'S RECOMMENDATION Receive and file the Employment Status Report SUMMARY The number of full-time equivalent (FTE) employees at OCSD is 601 ; actual headcount is 611 . PRIOR COMMITTEE/BOARD ACTIONS N/A PROJECTICONTRACTCOSTSUMMARY N/A BUDGET IMPACT D This item has been budgeted. (Line item: ) D This item has been budgeted, but there are insufficient funds. D This item has not been budgeted. ~ Not applicable (information item) ADDITIONAL INFORMATION PROMOTIONS: 6 NAME OLD JOB TITLE Keith Criscuolo Plant Operator Jim Spears Sr. Plant Operator Lo Ngo Accounting Asst. I Julie Kardos Engineering Asst. I Martin Dix Engineer Peter Hass IT Analyst Ill H:ldepllagenda\FAHRIFAHR2005\0605\05-48 Employment Status doc Revised: 06/04/03 NEW JOB TITLE Sr. Plant Operator Operations Supervisor Accounting Asst. II Engineering Asst. II CIP Project Manager Planner/Scheduler Book Page 35 DIVISION Operations, Plant 1 Operations, Plant 2 Accounting Engineering & Construction Project Mgmt. Office Project Mgmt. Office Page 1 RECLASSIFICATIONS: 1 NAME OLD JOB TITLE NEW JOB TITLE DIVISION Johnny Rocha Operator-In-Train in~ Plant Operator Operations, Plant 1 NEW HIRES: 7 JOB TITLE DIVISION Contracts Administrator Purchasing/Warehouse Sr. Contracts Administrator Purchasing/Warehouse Facilities Worker/Builder Facility Services Scientist O&M Process Engineering Information Technology Analyst Ill Programming & Database Support CIP Project Manager Project Management Office Maintenance Worker Regional Assets & Services TERMINATIONS: 0 ALTERNATIVES N/A CEQA FINDINGS N/A ATTACHMENTS NO DATA 1. May 16, 2005 Employment Status Report 2. Performance compared to budgeted FTE's H :ldept\agenda\F AH RIF AH R2005\0605\05-48, Employment Status.doc Revised: 06104/03 Book Page 36 Page 2 to 0 0 ;:,;-" "'O po (JQ (1) w -.J AUTHORIZED FTE DIV REG 0.50 0.75 110 General Management Admin 2.00 120 Administrative Services 6.00 1.00 130 Communications 7.00 0.50 . Gener.al Management Totals 15.00 1.50 210 Finance Administration 2.00 220 Accounting 20.00 230 Purchasing & Warehousing 22.00 0.50 Finance Totals 44.00 0.50 510 Human Resoura,s Admln 7.00 . . lnlems Intern Program (510) . 9.00 . 520 Employee Development/Training 3.00 530 Safety & Health 7.00 . 540 Employee Services 6.00 . 540 Planned Recruitments 2.00 Human Resources Totals 25.00 9.00 . 610 Technical Services Admln 2.00 . . 620 Environmental Assessment 15.00 . . 630 Environmental Sciences Lab 36.00 1.00 640 Source Control 40.00 . 660 Environmental Compliance Svcs 18.00 . Technlcal Services Totals 111.00 1.00 . 710 Engineering Admin 3.00 . 740 Planning 16.00 . 750 Project Management OfflC8 17.00 . 0.75 760 Engineering & Construction 58.00 . Engineering Totals 94.00 . 0.75 810 O&M Administration 4.00 . 420 Regional Assets & Services 29.75 0.50 - 430 Facilities Maintenance Svcs 32.00 0.75 . 820 O&M Process Engineering 15.00 0.50 . 830 Operations, Plant No. 1 39.00 . 0.75 840 Operations, Plant No. 2 47.00 . . 650 Mech Main! & Power Production 59.00 . 860 Electrical & Instrumentation Maint 54.00 . Operations & Malnb!nance Totals 279.75 1.75 0.75 910 IT Administration 3.00 . 930 IT Customer & Network Support 17.00 . . 940 IT Programming & Database Sys 12.00 .. . 950 IT Process Controls Integration 13.00 . . Information Technology Totals 45.00 . GRAND TOTAL FTEs 613.75 13.75 1.50 TOTAL AUTHORIZED FTE 629.00 R:\540\open\Recruiting_shared\Position Control-FAHR REPORT.xis EMPLOYIIENTSTATUSREPORT ACTUALFTE Recruitments Vacancies TOTAL ~ 0.50 0.75 LOA IQ.I& 2.00 2.00 ---2.00 . . 7.00 6.00 0.50 . 0.50 7.00 . . UiO 7.00 o.so --7.50 -- 1UO 15.00 1.00 -a.so 11150 . 2.00 2.00 -. . 2.00 1.00 - 20.00 18.00 . -1.00 19.00 . 1.00 22.50 21.00 0.50 -. 21.50 1.00 1 00 44.10 41.00 O.SD . 1.00 42.50 2.00 2.00 7.00 5.00 . . . S.00 1.00 200 9.00 . 6.00 -. 6.00 2.00 3.00 3.00 3.00 --. 3.00 . - 7.00 7.00 . --7.00 1.00 - 6.00 6.00 --. 6.00 -- 2.00 . . . -. . 2.00 34.00 21.00 6.00 . . 27.00 4.00 7.00 2.00 2.00 . -. 2.00 . - 15.00 14.00 . . -14.00 . 1 00 37.00 35.00 2.00 . . 37.00 -. 40.00 40.00 . . -40.00 . . 11.00 18.00 ---18.00 . . 112.00 109.00 2.00 . 111.00 . 1.00 3.00 3.00 --. 3.00 . . 11.00 15.00 . . -15.00 1.00 1 00 17.75 17.00 -0.75 . 17.75 . . 51.00 SO.OD -1.00 51,00 6.00 7 00 94.71 15.00 . 0.75 1.00 H.15 7.00 8.00 4.00 4.00 -. . 4.00 1.00 . 30.21 26.00 0.50 0.75 . 27.25 2.00 3.00 32.75 32.00 0.75 . . 32,75 -- 15.50 13.00 0.50 -. 13.50 3.00 2.00 39.71 38.00 -0.75 1.00 39.75 . - 47.00 45.00 -. -45.00 2.00 2.00 59.00 57.00 . -1.00 58.00 1.00 1.00 14.00 53.00 . -. 53.00 1.00 1.00 212.21 2811.00 1.75 1.50 2.00 273.25 10.00 9.00 3.00 3.00 . --3.00 -- 17.00 16.00 -. 1.00 17.00 -. 12.00 11.00 . --11.00 . 1 00 13.00 13.00 . . . 13.00 -. 45.00 43.00 . -· 1.00 44.00 -1.00 582.00 11.25 2.25 5.50 --- ·1 1· TOTAL Total + Total Vacancies ~C,TUAL FTE Recruitments (less recruilmenls) 601.00 2300 5.00 5116/2005 Book Page 38 Book Page 40 FAHR COMMITTEE AGENDA REPORT Orange County Sanitation District FROM: Lisa L. Tomko, Director of Human Resources Originator: James Matte, Safety & Health Supervisor Meeting Date To Bd. of Dir. 06/08/05 Item Number Item Number FAHR0S-49 SUBJECT: OSHA INCIDENCE RATES AND WORKERS' COMPENSATION CLAIMS AND COSTS REPORT GENERAL MANAGER'S RECOMMENDATION Receive and file the OSHA Incidence Rates and Workers' Compensation Claims and Costs Report. SUMMARY Safety and Health Division staff track OSHA Incidence Rates for DART Cases (DART Incidence Rate) and Total Accidents (Total Injury Frequency Rate). There were four DART Cases District-wide for the period of January through April 2005. The industry average is 4.50 for the DART Case Incidence Rate while the District Incident Rate was 2.06 for the period of January through April 2005. There were eight OSHA Recordable Accidents District-wide for the period of January through April 2005. The industry average is 7.30 for the Total Injury Frequency Rate while the District Incident Rate was 4.11 for the period of January through April 2005. The Division also tracks the District's Workers' Compensation Claims and Costs. The District's claim count for Fiscal Year 2004-2005 is 16. The costs associated with these claims for year-to-date is $26,536, which includes medical bills, temporary disability payments, legal costs and a claim reserve account. PRIOR COMMITTEE/BOARD ACTIONS N/A PROJECT/CONTRACT COST SUMMARY N/A BUDGET IMPACT D This item has been budgeted. (Line item: ) D This item has been budgeted, but there are insufficient funds. D This item has not been budgeted. ~ Not applicable (information item) Revised: 06/04/03 Book Page 41 Page 1 ADDITIONAL INFORMATION The District had four DART cases and four other injuries that required only medical treatment for the period of January through April 2005. The reporting period is for 45 days prior to committee meeting. ALTERNATIVES N/A CEQA FINDINGS N/A ATTACHMENTS 1. OSHA Incidence Rates Reports for DART Cases and Total Injuries 2. Workers' Compensation Claims and Costs Revised: 06/04/03 Book Page 42 Page 2 Safety and Health Division DART Cases District-Wide There were four DART Cases in January through April 2005. (DART -Days Away, Restricted or Transfer) DART Cases f/l I 1~-, II -•-z 2001 2002 2003 Calendar Year 2004 2005 OSHA Incidence Rates District-Wide The industry average for DART Cases is 4.50. The District rate was 2.06 for January through April 2005. The OSHA DART Case Incidence Rate is calculated by multiplying the number of injuries by 200,000 and dividing the sum by total hours worked. The rate is also based on the data for the calendar year so the rate will change as the number of hours worked increases. 2 3.00 rn 0::: 2.00 Q) u C: Q) 1.00 :g u -= 0.00 2001 OSHA Incidence Rates DART Cases 2002 2003 Calendar Year 2004 2005 Book Page 43 Workers' Compensation Claims and Costs The Workers' Compensation Claims and Costs are reported by fiscal year. The DART and Total Injury graphs shown above are calendar year rates as required for OSHA recordkeeping. All claims and medical invoices are reviewed by a third party to ensure that proper medical treatment is provided for injured employees and the costs for the treatment are within established guidelines. The medical bills reviewed for July 2004 through April 2005 totaled $121 ,777.29. Medical treatment costs are charged to the fiscal year in which the injury occurred. All open claims have the potential to incur additional costs. After the medical review process, the amount was reduced to $65,213.96, which resulted in savings of $56,573.33 for this reporting period. Workers Compensation Claims and Costs Fiscal Period Claim Count Open Claims Total Incurred 7/1/85 -6/30/86 38 0 $270,794 7 /1 /86 -6/30/87 53 0 $99,933 7 /1 /87 -6/30/88 51 0 $173,583 7 /1 /88 -6/30/89 41 0 $153,481 7 /1 /89 -6/30/90 61 0 $296,135 7/1/90 -6/30/91 76 0 $121 ,978 7/1/91 -6/30/92 58 2 $228,212 7 /1 /92 -6/30/93 58 0 $93,198 7 /1 /93 -6/30/94 47 0 $217,922 7 /1 /94 -6/30/95 46 0 $276,359 7/1/95 -6/30/96 46 1 $191,323 7/1/96 -6/30/97 36 0 $370,749 7/1/97 -6/30/98 45 1 $821,842 7/1/98 -6/30/99 38 2 $274,403 7 /1 /99 -6/30/00 43 2 $351,926 7/1/00-6/30/01 32 2 $402,793 7/1/01 -6/30/02 30 5 $437,382 7/1/02-6/30/03 18 4 $118,034 7/1/03 -6/30/04 15 2 $92,885 7 /1 /04 -6/30/05 16 5 YTD $26,536 "Total Incurred" includes medical bills, temporary disability payments to employees, legal costs, and a claim reserve account. Book Page 45 Book Page 46 FAHR COMMITTEE Meeting Date To Bd. of Dir. 6/8/05 AGENDA REPORT Item Number Item Number FAHR0S-50 Orange County Sanitation District FROM: Marc Dubois, Contracts / Purchasing Manager SUBJECT: GENERAL MANAGER APPROVED PURCHASES GENERAL MANAGER'S RECOMMENDATION Receive and file report of General Manager approved purchases in amounts exceeding $50,000 in accordance with Board purchasing policies SUMMARY In May 1998, the FAHR Committee and the Board approved changes to the staff purchasing authority. One of the changes was to increase the dollar threshold before Board authority was required for purchases of goods or services, excluding public works purchases, to $100,000. When approving this change, the Committee asked for periodic reports showing purchases approved by the General Manager for amounts between $50,000 and $100,000. Subsequent to receiving the initial report, the Committee requested that future reports be placed on the Consent Calendar. Vendor Name Amount Description/Discussion Wackenhut Corporation $93,600 Security services. RMS Engineering & Design, Inc. $97,100 Fire Suppression service for Plants 1 & 2. JR Filanc Construction $93,724 Hydrogen Peroxide facility modifications. RMS Engineering & Design, Inc. $56,170 Headworks construction trailers for plant 2. Thermo Electron Scientific $81 ,141 Spectrometer and Autosampler. Agilent Technologies, Inc. $53,875 GC/MS Quadrupole. Porter Novelli $55,000 Sole source -Consulting services to gain approval of an organics recvclinQ facility at Great Park. Gates Fiberglass Installers $52,533 Provide and install zero leakage dampers. Skye LLC $51,980 Plan record drawings rack and filing system. Section 4.03.B of Resolution 04-08, the District's Delegation of Authority Resolution, authorizes the Contracts I Purchasing Manager to purchase items that have been previously authorized by the Board as identified in the annual District budget. During the budget adoption process, the lists of these items were highlighted for the Directors. For these reasons, purchases that fell into these categories are not included in this report. H:\depl\agenda\FAHRIFAHR2005\0605\05-50 GM approved purchases doc Revised: 06/04/03 Book Page 47 Page 1 PRIOR COMMITTEE/BOARD ACTIONS N/A PROJECT/CONTRACT COST SUMMARY N/A BUDGET IMPACT D This item has been budgeted. (Line item: ) D This item has been budgeted, but there are insufficient funds. D This item has not been budgeted. ~ Not applicable (information item) ADDITIONAL INFORMATION N/A ALTERNATIVES N/A CEQA FINDINGS N/A ATTACHMENTS None H :\dept\agenda\F AH RIF AHR2005\0605\05-50, GM approved purchases.doc Revised: 06/04/03 Book Page 48 Page 2 FAHR COMMITTEE Meeting Date To BcJ. of Dir. 06/08/04 06/22/04 AGENDA REPORT Item Number Item Number FAHR0S-51 Orange County Sanitation District FROM: Gary Streed, Director of FinancefTreasurer SUBJECT: PROPOSED FY 2005-06 OPERATING, CAPITAL, DEBT/COP SERVICE AND SELF-INSURANCE BUDGETS GENERAL MANAGER'S RECOMMENDATION Approve proposed Operating, Capital, Debt/COP Service and Self-Insurance Budgets for FY 2005-06, as follows Net Operations, Maintenance & Working Capital Worker's Compensation Self Insurance General Liability and Property Self-Insurance Net Capital Improvement Program Debt/COP Service SUMMARY $117,791,000 $591,000 $1,702,000 $277,111,000 $48,586,000 The FY 2005-06 Budget is enclosed for the Committee's consideration. The Budget has been presented to the OMTS and PDC Committees at their regular June meetings in order to allow each Standing Committee an opportunity to review the proposal prior to the June Board meeting. Although each Committee has had an opportunity to review the proposal, it remains the responsibility of the Finance, Administration and Human Resources Committee to recommend approval. The FAHR Committee is requested to recommend that the Board of Directors approve this budget. PRIOR COMMITTEE/BOARD ACTIONS Board approved 2004-05 Budget for the period July 1, 2004 through June 30, 2005. FAHR reviewed preliminary budget presentations between January and May 2005. PROJECT/CONTRACT COST SUMMARY N/A Book Page 49 FAHR COM MITTEE AGENDA REPO RT Orange County Sanitation District FROM: Gary Streed, Director of Finance/Treasurer Originator: Michael D. White, Controller Meeting Date 6/09/04 Item Number FAHR0S-52 SUBJECT: ANNUAL RENEWAL OF THE DISTRICT'S EXCESS WORKERS' COMPENSATION INSURANCE GENERAL MANAGER'S RECOMMENDATION Renew the District's Excess Workers' Compensation Insurance for the period To Bd. of Dir. 6/23/04 Item Number July 1, 2005 through June 30, 2006, at a rate not to exceed $0.003993 of the actual payroll during this time period. SUMMARY The District's Excess Workers' Compensation insurance coverage with the California Public Entity Insurance Authority (CPEIA), the second year the District has participated in this program, expires on July 30, 2005 and is now up for renewal for fiscal year 2005- 06. The District's Excess Workers' Compensation Program currently provides coverage to $100 million with a self-insured retention (SIR), or deductible of $500,000. The proposed renewal maintains the existing $100 million coverage limit and self- insured retention of $500,000. Premiums for this enhanced policy will decrease from the prior year's rate per actual payroll of $0.00433 to $0.00363, or 16.2 percent, resulting in a FY 2005-06 estimated premium amount of $207,000. As of the date of this report, CPEIA is still negotiating an increase in the $100 million coverage limit to $150 million for FY 2005-06 without any additional premium increase. However, there is no assurance that a rate increase won't follow the premium increase and Driver Alliant is recommending that the rate for $100 million coverage of $0.00363 be increased 10 percent, or to $.003993, for budgeting purposes. In order to gauge the market, Driver Alliant has also contacted two other workers' compensation insurance carriers that could possibly service a public agency the size of the District and will be providing a full report at the meeting. Staff recommends the annual renewal of All-Risk Property and Flood insurance coverage for the District covering the period from July 1, 2004 through June 30, 2005. Sufficient funds have been budgeted within the FY 2004-05 budget to cover premium costs. PRIOR COMMITTEE/BOARD ACTIONS Board last approved renewal for the period July 1, 2003 through June 30, 2004. H:ldeptlfin\220\while\FAHR\Risk Mgmt\05-06 Renewal of Workers ColTlJensalion.doc Revised: 06/04/03 Book Page 51 Page 1 PROJECT/CONTRACT COST SUMMARY The premium cost for FY 2004-05 will be reported on June 9, 2004, prior to obtaining the Committee's approval. BUDGET IMPACT fg] This item has been budgeted. (Line item: ) D This item has been budgeted, but there are insufficient funds. D This item has not been budgeted. D Not applicable (information item) ADDITIONAL INFORMATION Background The District's use of Excess Workers' Compensation insurance dates back to 1989-90. At that time, the Fiscal Policy Committee approved a self-insured retention (SIR), or deductible, of $250,000, for such coverage. Due to the hardening of the workers' compensation market, this deductible was raised to $500,000 beginning in FY 2002-03 through a policy with Employers Reinsurance Corporation (ERC) that provided coverage to $25 million with a self-insured retention (SIR), or deductible of $500,000. The premium cost charged by ERC for the period July 2002 to June 30, 2003 was $69,090. Staff has reviewed the District's most recent five-year workers' compensation loss history with Cambridge Integrated Services Group, the District's third-party workers' compensation administrator, and has verified that the District has not incurred a loss which exceeded the $500,000 SIR. In FY 2003-04, the District joined the California Public Entity Insurance Authority (CPEIA), the lowest responsible provider, and approved the District's Excess Workers' Compensation Insurance, with limits of $50 million, a self-insured retention of $500,000, in an amount totaling $168,720. In FY 2005-06, the District again renewed with CPEIA with increased limits from $50 million to $100 million while maintaining the self-insured retention of $500,000, in an amount totaling $208,384. FY 2005-06 Renewal Cycle Staff is seeking renewal continuation with coverages and deductibles at the current levels. The CPEIA proposed renewal rates are expected to be finalized by mid-June. As previously stated, Driver Alliant is anticipating that the proposed premium of H:ldepllfin\220\while\FAHR\Risk Mgml\05--06 Renewal ofWor1<ers Compensation.doc Revised: 06/04/03 Book Page 52 Page2 $0.00363 per actual payroll will be more favorable than the prior year by 16.2 percent providing that the coverage is renewed at the same limits and self-insured retentions. CPEIA is also considering raising the limits from $100 million to $150 million. Although Driver Alliant does not believe there will be any rate increase specifically associated with this limit increase, they recommend that the estimate of $.00363 per actual payroll be increased by 10 percent, to $.003993, for budgeting purposes. Some additional risk is associated with the CPEIA joint powers authority in that a premium surcharge can be assessed to individual members based on an unusually large number of losses occurring outside of the actuarial evaluation estimates. However, only once has an actual surcharge ever been made to the County Supervisors Association of California (CSAC), the parent organization to CPEIA that has been in existence for over 20 years. The premium surcharge was assessed following the first year of CSAC's existence and prior to the use of an actuary for the determination of rates and assumptions. Rates have been based on actuarial evaluations ever since the shortfall in the first year. CPEIA itself has only been in existence for four years and has never initiated a premium surcharge. RECOMMENDATION Excess Workers' Compensation Program is recommended for renewal through CPEIA. This policy will provide limits of $100 million or $150 million, depending on final CPEIA Board action, with a self-insured retention of $500,000. The premium cost for FY 2005-06 is being proposed at $.003993 per actual payroll. Based on preliminary information on premiums, staff is certain that sufficient funds have been budgeted to cover premium costs. ALTERNATIVES Choose an alternative insurance carrier that has a more attractive premium rate should such a proposal be developed by Driver Alliant and presented at the FAHR Committee meeting. CEQA FINDINGS N/A ATTACHMENTS None. H:ldeptlfin\220\white\FAHR\Risk Mgml\05-06 Renewal ofWor1<ers ColT'4)ensalion.doc Revised: 06/04/03 Book Page 53 Page 3 nook Page 54 FAHR COMMITTEE AGENDA REPORT Orange County Sanitation District FROM: Gary Streed, Director of Finance/Treasurer Originator: Michael D. White, Controller Meeting Date 6/08/05 Item Number FAHR0S-53 SUBJECT: ANNUAL RENEWAL OF THE DISTRICT'S EXCESS LIABILITY INSURANCE PROGRAM, FY 2005-06 GENERAL MANAGER'S RECOMMENDATION Renew the District's Excess General Liability Insurance Program for the period July 1, 2005 through June 30, 2006, in an amount to be determined. SUMMARY To Bd. of Dir. 6/22/05 Item Number Staff recommends the renewal of the District's $25 million Excess General Liability Insurance Program for FY 2005-06. The coverage is provided through the California Municipal Excess Liability Program {CAMEL). The District has participated in the CAMEL program since FY 1996-97 after completing a competitive bid selection process. Approval of this agenda item will extend the District's $25 million liability coverage through the CAMEL program for an additional year. At this time, final premium costs are being negotiated and will be presented to the Committee on June 8. PRIOR COMMITTEE/BOARD ACTION Board last approved renewal for the period July 1, 2004 through June 30, 2005. PROJECT/CONTRACT COST SUMMARY N/A BUDGET IMPACT ~ This item has been budgeted. (Line item: ) D This item has been budgeted, but there are insufficient funds. D This item has not been budgeted. D Not applicable (information item) H:\dept\lin\220\while\FAHR\Risk Mgmtlliab 060805 AG.doc Revised: 8/10/98 Book Page 55 Page 1 ADDITIONAL INFORMATION Background The current liability insurance program provides the District with a $25 million policy of comprehensive coverage for municipal liability, bodily injury and property damage, and personal injury. The program was structured to also include Employment Practices, and Public Officials Errors & Omissions coverage. The $25 million coverage is per occurrence, with a self-insured deductible of $250,000 per occurrence. Since 1997, the Employment Practices portion of coverage was enhanced from a $2 million sub-limit, to the full $25 million policy limit. Two important advantages of the multi-year renewal of the District's participation in the CAMEL general liability insurance program include guaranteed coverage and cost stability. When the District entered into the CAMEL program in July 1996, we obtained an annual premium cost not to exceed $125,000 in the first year, a commitment for a two-percent premium reduction in the second year of the program, and a five-percent premium reduction in the third year. Actual premium reductions obtained during this first three-year period were more than ten percent. A three-year agreement was reached in 1998-99 that included a level annual premium not to exceed $111,492 for the first $10 million layer of insurance coverage. In FY 2001-02, a new three year commitment was reached that allows for the renewal of the District's Excess General Liability insurance policy that guarantees continuation of the District's first $10 million layer of insurance coverage, while placing a maximum on premium increases of ten percent per year through 2002-03. The premium on the next $15 million layer of insurance coverage excess of $10 million is subject to current market pricing. In FY 2002-03, the program's insurer, Kemper Insurance, decided it would no longer provide coverage to public agencies across the country for its "Basic" insurance, or first layer coverage. The CAMEL program replaced Kemper for renewal of the "Basic" $10 million program with American Re through their Great Lakes U.K. insurance carrier, calling for a premium increase of 20 percent plus taxes and fees due to its non-admitted status within the State of California, or $133,016. The second $15 million layer excess of $10 million of the total $25 million Excess Liability Insurance Coverage was provided through Kemper Surplus Lines Insurance at a premium of $62,208. This was an increase of 307.0 percent over the prior year's premium of $15,283 with relatively the same level of coverage. Although this is a non-admitted insurer, it carried an A-, Excellent rating from Best Guide Rating and was the only insurance carrier willing to submit a bid for this $15 million layer. In FY 2003-04, the program's insurer, American Re through their Great Lakes U.K. insurance carrier, decided it would no longer provide coverage to public agencies across the country for its "Basic" insurance, or first layer coverage. The CAMEL program replaced American Re for renewal of the "Basic" $10 million program with American International Group (AIG), calling for a premium increase to $265,441, or 99.6 percent increase over the prior year amount of $133,016. In addition, self-insured retention increased from $100,000 to $250,000. However, terrorism coverage has been H:ldeptlfin\220\whilelFAHR\Risk Mgmt\Liab 060805 AG.doc Revised: 8/10198 Book Page 56 Page2 added with the same coverage and limits. The second $15 million excess of $10 million of the total $25 million Excess Liability Insurance Coverage was provided through Gulf Underwriters Insurance Company at a premium of $124,523. This was an increase of 99.9 percent over the prior year's premium of $62,208 with relatively the same level of coverage except for the addition of terrorism coverage. Although this is a non-admitted insurer, it carries an A-, Excellent rating from Best Guide Rating. In FY 2004-05, the CAMEL program continued to utilize AIG for the "Basic" $10 million program with a premium increase to $395,632, or 49.0 percent increase over the prior year amount of $265,441. FY 2005-06 Renewal Cycle The District's Broker of Record, Driver Alliant, is still in the process of negotiating several renewal options and is hoping to be able to provide a formal proposal prior to the FAHR Committee Meeting of June 8th . At this time, they are estimating premium increases to be limited to less than 25 percent over the FY 2004-05 premium of $395,632 and are diligently working towards a much smaller increase, with the possibility of renewing at approximately the same rate as the prior year. Recommendation The FY 2005-06 Excess General Liability Insurance Program is recommended for renewal through the CAMEL joint purchase program. This policy provides for $25 million of comprehensive coverage for municipal liability, bodily injury and property damage, and personal injury, with a self-insured deductible of $250,000 per occurrence. The premium cost for FY 2005-06 will be reported on June 8, 2005 prior to obtaining the Committee's approval. Based on preliminary information on premiums, staff is certain that sufficient funds have been budgeted to cover premium costs. ALTERNATIVES N/A ATTACHMENTS 1. Letter dated May 25, 2005 from the District's Broker of Record, Driver Alliant, on the renewal status for excess liability insurance. H:\depMn\220\white\FAHR\Rlsk Mgmt\liab 060B05 AG.doc Revised: 8/10/9B Book Page 57 Page 3 13ook Pag~ 58 driver+alliant I 1NSURANCE SERVICES May 25, 2005 Mr. Michael White, Controller Orange County Sanitation District P.O. Box 8127 Fountain Valley, CA 92728-8127 Re: Excess Liability Insurance INTEGRATED INSURANCE & FINANCIAL SERVICES Insurance Company of the State of Pennsylvania# 4204-1942 Gulf Insurance Company# GU 595 8858 Dear Mike, The captioned insurers provide $25,000,000 in liability insurance excess of a $250,000 self insured retention under our California Municipal Excess Liability (CAMEL) program. As highlighted in our recent CAMEL seminar, we anticipate being able to provide formal July 1, 2005 renewal quotations prior to June 15 and continue to work toward that goal. Hopefully, we will be in a position to provide that formal proposal prior to the F AHR Committee meeting. At this point, we are estimating that premium rate increases -in the still restrictive but improving liability insurance marketplace -will be limited to less than 25% over the current $395,632 premium and are diligently working to effect a much smaller increase, hopefully a .. flat" rate. We shall keep you informed of our progress over the next few days and shall forward our fonnal proposal under separate cover. Sincerely, DRIVER ALLIANT INSURANCE SERVICES ✓-) ; ,,,/ , • .., • ,J-"' ✓" ('·...::::r ' .. / ( .:,;,,.,..,.._ Donald H. McLean Senior Vice President I i Driver Alliant Insurance Services, Inc. an Alliant Resources Group company 1301 Dove St. Suite 200, Newport Beach CA 92660-2436 • 949-756-0271 Lie #0(36861 • www.driveralliant.com Book Page 59 Book Page 60 FAHR CO MMITTEE AGE NDA RE-PORT Orange County Sanitation District FROM: Gary Streed, Director of Finance/Treasurer Originator: Michael White, Controller Meeting Date 06/08/05 Item Number FAHR05-54 SUBJECT: ANNUAL RENEWAL OF BOILER & MACHINERY INSURANCE PROGRAM GENERAL MANAGER'S RECOMMENDATION To Bd. of Dir. 06/22/05 Item Number Renew the District's Boiler & Machinery Insurance Program for the period July 1, 2005 to June 30, 2006, in an amount not to exceed $23,753. SUMMARY Staff recommends the annual renewal of Boiler & Machinery insurance coverage for the District covering the period from July 1, 2005 through June 30, 2006. The Boiler & Machinery insurance program provides comprehensive coverage for loss caused by machinery breakdown and explosion of steam boilers or other covered process equipment, including damage to the equipment itself and damage to other property caused by covered accident. Sufficient funds have been budgeted within the FY 2005- 06 budget to cover premium costs. PRIOR COMMITTEE/BOARD ACTIONS Board approved annual renewal for FY 2004-05. PROJECT/CONTRACT COST SUMMARY Sufficient funds are contained in the current budget to cover premium costs of $23,753. BUDGET IMPACT cg) This item has been budgeted. (Line item: ) D This item has been budgeted, but there are insufficient funds. D This item has not been budgeted. D Not applicable (information item) ADDITIONAL INFORMATION The District's FY 2005-06 Boiler & Machinery insurance program provides coverage ($100 million per occurrence/ with deductibles ranging from $25,000 to $350,000) for losses caused by covered machinery breakdown (e.g., motors, steam turbines, digesters, co-gen engines). Damages to the equipment, as well as damages to other property and improvements caused by the machinery breakdown, are covered by the H:ldeptlfin\220\white\FAHR\Risk Mgmt\05-06 Renewal of Boiler & Machinery.doc Revised: 06/04/03 Book Page 61 Page 1 boiler & machinery insurance. This program augments the District's all-risk property insurance that covers perils such as fire and flood. July 11 2005 -June 30. 2006 Renewal Cycle Driver Alliant Insurance Services, the District's Broker of Record, has reviewed the current state of the Boiler & Machinery insurance market and recommends that the District renew Boiler & Machinery insurance coverage with Lexington Insurance Company for the primary layer of $10 million and with two group of carriers, CNA Insurance Company, and 7 different foreign excess insurance companies, providing coverage jointly on the second layer of $90 million for the period of July 1 , 2005 through June 30, 2006. The combined proposed insurance premium of $23,753 is a 14.1 percent decrease over the prior year premium of $27,654. However, the prior year deductible of $25,000 for all boiler and machinery categories is now being proposed to increase for four out of the 9 categories with increases ranging from $50,000 to $350,000. As of the date of this report, Driver Alliant is still reviewing the current marketplace and will advise if more competitive proposals are received. Following are the reserve levels, A.M. Best Guide Rating (the insurance industry rating agency), and the Standard and Poor's rating for each of the three insurance groups: Proposed Schedule of Insurers Reserve A.M Best Standard California Company Level Rating and Poor's Status Lexington > $2 billion A++, Superior AA+ Non-Admitted CNA > $2 billion A, Excellent A-Admitted 6 foreign Co.'s > $1.5 billion At least A-, Excellent 2-Not Rated, 5-A-or> Non-Admitted Conclusion All proposed insurance carriers are strong insurance companies and can offer Boiler & Machinery insurance with high coverage levels for operations as large and complex as the District. As of the date of this report, they offer the most competitive pricing for the upcoming renewal period. Staff concurs with Driver Alliant's findings and recommendation. Sufficient funds are contained in the current budget to cover premium costs of $23,753. ALTERNATIVES Choose an alternative insurance carrier for Boiler and Machinery Insurance coverage if one with a more attractive premium rate becomes available and is presented at the June 8 FAHR Committee meeting. ATTACHMENTS Proposal from Driver Alliant as of May 25, 2005. H:ldepllfin\220\while\FAHR\Risk Mgml\05-06 Renewal of Boiler & Machinery.doc Revised: 06/04/03 Book Page 62 Page2 to 0 0 :,;-- '"O ~ OCI (I) 0\ w driver•alliant INSURANCE SERVICES------------------------------C a Ii for n i a Lie# OC36861 POLICY PERIOD: COMPANIES: *BEST'S GUIDE RATING: (As of 05/24/05) INTEGRATED INSURANCE & FIN1\l'lCIAL SERVICES ORANGE COUNTY SANITATION DISTRICT (OCSD) BOILER AND MACHINERY PROPOSAL JULY 1, 2005 TO JULY 1, 2006 PRESENT July 1, 2004 to July 1, 2005 Lexington Insurance Company 100% of $10,000,000 Primary CNA Insurance Company 50% of $90,000,000 Excess of $10,000,000 Foreign Excess Ins. Companies 50% of $90,000,000 Excess of$10,000,000 (See attached list of Companies) PROPOSAL I July 1, 2005 to July 1, 2006 Lexington Insurance Company 100% of$10,000,000 Primary CNA Insurance Company 50% of$90,000,000 Excess of $10,000,000 Foreign Excess Ins. Companies 50% of $90,000,000 Excess of $10,000,000 (See attached list of Companies) *STANDARD & POOR'SRATING: (See attached list of Companies) (See attached list of Companies) TOTAL INSURED VALUES: COVERAGES & LIMITS: $ 1,589,329,379 as of July 1, 2004 $ 100,000,000 Boiler & Machinery, Breakdown, Combined Property Damage and Business Interruption/ Extra Expense (Including Bond Revenue Interest Payments where Values Reported and excluding Business Coverage for power generating facilities). Limit includes loss adjustment agreement, defense costs outside of limits and electronic computer or electronic data processing equipment with the following sub-limits: Included Inspection Services Included Per Occurrence for Machine or Apparatus used for Research, Diagnosis, Medication, Surgical, Therapeutic, Dental or Pathological Purposes $ 1,659,830,753 as of May 1, 2005 $ 100,000,000 Boiler & Machinery, Breakdown, Combined Property Damage and Business Interruption/Extra Expense (Including Bond Revenue Interest Payments where Values Reported and excluding Business Coverage for power generating facilities). Limit includes loss adjustment agreement, defense costs outside oflimits and electronic computer or electronic data processing equipment with the following sub-limits: Included Inspection Services Included Per Occurrence for Machine or Apparatus used for Research, Diagnosis, Medication, Surgical, Therapeutic, Dental or Pathological Purposes *See page 4 for additional information. Driver Alliant Insurance Services, Inc. w1 ..-lfli,mr H.f'IOHff<'I (,ro11p Cu111pa11F 1301 Dove St.. Ste. 200, Newport Beach. CA 92650 • P.O. Box 6450. Newport Beach, CA 92658-6450 Phone (949) 756-0271 • Fax (949) 756-2713 • www.driveralliant.com 0:, 0 0 ;:,;- "ti Pl (JQ (1) 0\ .j:>. COVERAGES & LIMITS: (Cont.): NAMED INSURED CLAUSE: NEWLY ACQUIRED LOCATIONS: driver+alliant j tNSURANCE SERVICES ORANGE COUNTY SANITATION DISTRICT (OCSD) BOILER AND MACHINERY PROPOSAL JULY 1, 2005 TO JULY 1, 2006 PRESENT J>EPIP BOILER & MACHINERY PROGRAM $ 10,000,000 Per Occurrence for Expediting Expense $ 10,000,000 Per Occurrence for Errors & Omissions $ 10,000,000 Per Occurrence for Utility Interruption for Utilities owned by others $ 10,000,000 Per Occurrence for Ammonia Contamination $ 10,000,000 Per Occurrence for Water Damage $ 10,000,000 Per Occurrence for Consequential Damage $ 2,000,000 Per Occurrence for Electronic Data Processing Media $ 2,000,000 Per Occurrence for Annual Aggregate for Earthquake ResuJtant Damage for Members who purchase Dedicated Earthquake Coverage $ 10,000,000 Per Occurrence for Demolition and Increased Cost of Construction $ 1,000,000 Per Occurrence for Hazardous Substance $ 1,000,000 Per Occurrence for Building Ordinance Coverages Named Insured covers entities you acquire or in which you have 50% or more ownership or contractual control prior to loss $ 25,000,000 Automatic Acquisition for Boiler & Machinery values at newly acquired locations. Values greater than $25,000,000 or Power Generating Facilities must be reported within 90 days and must have prior underwriting approval prior to binding 2- PROPOSAL 1 PEPIP BOILER & MACHINERY PROGRAM $ 10,000,000 Per Occurrence for Expediting Expense $ 10,000,000 Per Occurrence for Errors & Omissions $ 10,000,000 Per Occurrence for Utility Interruption for Utilities owned by others $ 10,000,000 Per Occurrence for Ammonia Contamination $ 10,000,000 Per Occurrence for Water Damage $ 10,000,000 Per Occurrence for Consequential Damage $ 2,000,000 Per Occurrence for Electronic Data Processing Media $ 2,000,000 Per Occurrence for Annual Aggregate for Earthquake Resultant Damage for Members who purchase Dedicated Earthquake Coverage $ 10,000,000 Per Occurrence for Demolition and Increased Cost of Construction $ 1,000,000 Per Occurrence for Hazardous Substance $ 1,000,000 Per Occurrence for Building Ordinance Coverages Named Insured covers entities you acquire or in which you have 50% or more ownership or contractual control prior to loss $ 25,000,000 Automatic Acquisition for Boiler & Machinery values at newly acquired locations. Values greater than $25,000,000 or Power Generating Facilities must be reported within 90 days and must have prior underwriting approval prior to binding 0St25!D:'i t,:l 0 0 :,,;-- "d ~ °' Vl VALUATION: EXCLUSIONS (Including but not limited to): OBJECTS EXCLUDED: (Including but not limited to): NOTICE OF CANCELLATION: DEDUCTIBLES: driver+alliant j INSURANCE SERv1c1:s ORANGE COUNTY SANITATION DISTRICT (OCSD) BOILER AND MACHINERY PROPOSAL JULY 1, 2005 TO JULY 1, 2006 PRESENT PEPIP BOILER & MACHINERY PROGRAM Repair or Replacement except Actual Loss sustained for all Time Element coverages • Testing • Explosion, except for steam or centrifugal explosion • Explosion of gas or unconsumed fuel from furnace of the boiler • lnsulating or refractory material • Buried Vessels or Piping • Furnace, Oven, Stove, Incinerator, Pot Kiln 90 days except 10 days for non-payment of premium $ 25,000 All Objects Except as shown for Specific Objects or Perils $ 25,000 Electronic Data Processing Media $ 25,000 Consequential Damage $ 25,000 Objects over 200 hp, 1,000KW/KVA/Amps or Boilers over 5,000 square feet of heating surface $ 25,000 Objects over 350 hp, 2,500 KW /KV A/ Amps or Boilers over 10,000 square feet of heating surface $ 25,000 Objects over 500 hp, 5,000 KW /KV A/Amps or Boilers over 25,000 square feet of heating surface $ 25,000 Objects over 750 hp, 10,000 KW/K.VA/Amps or Boilers over 75,000 square feet of heating surface $ 25,000 Objects over 25,000 hp, 25,000KW/KVNAmps or Boilers over 250,000 square feet of heating surface $ 25,000 Deep Water Wells 3- PROPOSALl PEPIP BOILER & MACHINERY PROGRAM Repair or Replacement except Actual Loss sustained for all Time Element coverages • Testing • Explosion, except for steam or centrifugal explosion • Explosion of gas or unconsumed fuel from furnace of the boiler • Insulating or refractory material • Buried Vessels or Piping • Furnace, Oven, Stove, Incinerator, Pot Kiln 90 days except 10 days for non-payment of premium $ 25,000 Except as shown for Specific Objects or Perils $ 25,000 Electronic Data Processing Media $ 25,000 Consequential Damage $ 25,000 Objects over 200 hp, 1,000 KW/KV A/Amps or Boilers over 5,000 square feet of heating surface $ 50,000 Objects over 350 hp, 2,500 KW/KV A/Amps or :Boilers over 10,000 square feet of beating surface $ 100,000 Objects over 500 hp, 5,000 KW/KV A/ Amps or Boilers over 25,000 square feet of heating surface $ 250,000 Objects over 750 hp, 10,000 KW /KV A/ Amps or Boilers over 75,000 square feet of beating surface $350,000 Objects over 25,000 hp, 25,000 KW/KV AfAmps or Boilers over 250,000 square feet of heating surface $ 25,000 Deep Water Wells 05 '25 '05 c:, 0 ~ "O I» ~ O's O's DEDUCTIBLES (Cont.): ANNUAL PREMIUM: BROKER: driver+alliant I INSURANCE SERVICES ORANGE COUNTY SANITATION DISTRICT (OCSD) BOILER AND MACIDNERY PROPOSAL JULY 1, 2005 TO JULY 1, 2006 PRESENT PROPOSAL! PEPIP BOILER & MACHINERY PROGRAM PEPIP BOILER & MACHINERY PROGRAM 24 Hours Business Interruption/Extra Expense Except as noted below 30 Days Business Interruption -Revenue Bond 24 Hr. Waiting Period-Utility Interruption 24 Hours Business Interruption/Extra Expense Except as noted below 30 Days Business Interruption -Revenue Bond 24 Hr. Waiting Period -Utility Interruption 5 X 100% Daily Value -Business Interruption -All Objects over 750 hp or 10,000 KW/KV A/Amps or 10,000 Square feet Heating Surface 5 X 100% Daily Value -Business Interruption-All Objects over 750 hp or 10,000 KW/KV A/Amps or 10,000 Square feet Heating Surface 5 X 100% Daily Value -Business Interruption-All Objects at Waste Water Treatment Facilities and All Utilities 5 X 100% Daily Value -Business Interruption -All Objects at Waste Water Treatment Facilities and All Utilities $ 27,654 $23,753 DRIVER ALLIANT INSURANCE SERVICES, INC. License No. 0C36861 Don McLean Jr. Senior Vice President Karen Worden Assistant Vice President Carol Hart Account Administrator Coverage outlined in this Proposal is subject to the terms and Conditions set forth in the policy. • Analyzing insurers· over-a/I performance and financial strength is a task that requires specialized skills and in-depth technical understanding of all aspects of insurance company finances and operations. Insura11ce brokerages s11d 1 as Driver Alliant Insurance Services. Inc. typically rely upo11 rati11g agencies for this type of market analysis. Both A.M. Best and Standard and Poor have been i11dus1ry leaders in this area/or many decades, utilizi11g a combination of quantitative and qualitative analysis of the i,iformation available in formulati11g their ratings. A.M. Best has an extensive database of nearly 6,000 Life/Health, Property Casualty and International companies. You can visit them at w1nv.a111best.co111 For additional information regarding insurer financial strength ratings visit Standard and Poor's website at www.i1,.mre.c,m1/mti11gs/protiles/ To learn more about companies doing business in California, visit the California Department of Insurance website at f1·ww.i11surance.ca.g<Jl' Note: Commissions are customarily paid by the insurance company as a percentage of premiums. Additional income may be paid contingent on volume, profitability or other factors. 4- (\<;,").:;,(I<; JUN-02-2005 10:19 FROM: T0:7149623954 P.2/2 / Public Entity Property Insurance Program (PEPIP) 2005-2006 Policy Year Schedule of Insurers -Boiler and Machinery ( Company A.M. A.M. Best's Gulde Rating Standard and Califomia Bnt's l"oor's Status l.D.# Allled World AS9W'IU1Ce 84808 A+,Supcrior, Not Rated Non•Admim:d Company Ltd. Financial Size Caregory 14; (As of 4/29/0S) $ \ ,500,000,000 to S2,000,000,000 (l\s of 4/29/0.:i) Arch Specialty Ins. Co. 11S23 A,., Excellent; Not Rated Non-Admitted Finaucial Si2e Caresory 13; (As of 4/29/0S) s1.2so.ooo.ooo 10 s1.soo,ooo.ooo (As of 4/29/05) Axis Specialty Europe 83007 A, Excellent; A Non-Admitted Ltd. Financial Size C11tegory 14; (As of 4/29/05) Sl,S00,000,000 to $2,000,000,000 (As of 4/29/05) CNA 18313 A, Excellent; A-Admined Financial Size Catcgoxy IS; (As of 4/29/0S) $.2.000.000.000 or more (As of 4/29/0S) ( Endulance Specialty Ins. 84835 A, 'Excellem; A-Non-Admitted Lid. Financial Size Category 14; (As of4/Z9/05) Sl,S00,000,000 to $2,000,000,000 (As of 4/29/0S) Great Lakes R~insurance 86160 A+. Superior: A+ Non-Admitted (UK)PLC Financial Size Category 1S; (As of 4/29/0S) Greater Than $2,000,000,000 (As of 4/29/0S) Lexington Ins. Co. 02350 A++u. Superior. AA+ Non-Admitted Financial Size Category 15; (As of4/W/05) GrcAllCr Tbao·S2,000,000,000 (Ai; of 4/29/05) Lloyds of London 85202 A, .BxcelJcnt; A Non-Admitted Financial Size Category 1 S; (As of 4/29/05) Greater Than $2,000,000,000 (As of 4/29/05) Monipclic.r Rcinsur1U1cc 84809 A, Ex-.cllcnt; A· Non•Admitt1:d Ltd. Financial Si%e Category 14; (As of 4/29/05) $1,500,000,000 to $2,000,000,000 (As of 4/29/05) .-~- Printed from Database on S/26/2005 Book Page 67 Book Page 68 FAHR COMMITTEE AGENDA REPORT Orange County Sanitation District FROM: Gary Streed, Director of Finance/Treasurer Originator: Michael D. White, Controller Meeting Date To Bd. of Dir. 6/8/05 6/22/05 Item Number Item Number FAHR 05-55 SUBJECT: ANNUAL RENEWAL OF THE DISTRICT'S ALL-RISK PROPERTY AND FLOOD INSURANCE PROGRAM FOR FY 2005-06 GENERAL MANAGER'S RECOMMENDATION Renew the District's All-Risk Property and Flood Insurance Program for the period July 1, 2005 through June 30, 2006, in an amount not to exceed $586,527. SUMMARY The District's All-Risk Property and Flood insurance coverage expires June 30, 2005, and is now up for renewal for FY 2005-06. The All-Risk insurance program provides for comprehensive coverage for the District's real and personal property from all perils including fire, flood, and business interruption. The renewal proposes to increase the current year's $750 million blanket loss limit for most perils including fire damage to $1 billion while maintaining the existing $300 million blanket loss limit for flood. Premiums for this enhanced policy will actually decrease from the prior year's $729,388 to $586,527, or 19.6 percent. Staff recommends the annual renewal of All-Risk Property and Flood insurance coverage for the District covering the period from July 1, 2005 through June 30, 2006. Sufficient funds have been budgeted within the FY 2005-06 budget to cover premium costs. PRIOR COMMITTEE/BOARD ACTIONS Board approved annual renewal for FY 2004-05. PROJECT/CONTRACT COST SUMMARY Sufficient funds have been proposed within the FY 2005-06 Budget to cover premium costs in an amount not to exceed $586,527. BUDGET IMPACT _[gl This item has been budgeted. (Line item: ) D This item has been budgeted, but there are insufficient funds. D This item has not been budgeted. •: Not applicable (information item) H:\depl\fin\220\white\FAHR\Risk Mgml\05-06 Property Ins Renewal.doc Revised: 06/04/03 Book Page 69 Page 1 FAHR CO MM ITTEE Meeting Date To Bd. of Dir. 06/08/05 06/22/05 AGE NDA REPO RT Item Number Item Number FAHR05-56 Orange County Sanitation District FROM: Lisa L. Tomko, Director of Human Resources SUBJECT: IMPACTS OF INTERNAL REVENUE CODE SECTION 415(b) AND ESTABLISHMENT OF REQUIRED REPLACEMENT BENEFIT PLAN GENERAL MANAGER'S RECOMMENDATION 1) Adopt Resolution No. OCSD 05-XX, authorizing the General Manager to adopt a Replacement Benefits Plan in compliance with County Employees Retirement Law of 1937; 2) Authorize the General Manager to delegate the administration of the Replacement Benefits Plan as he determines to be appropriate; and, 3) Authorize the General Manager to enter into a Memorandum of Understanding with Orange County Employees Retirement System for said Replacement Benefits Plan. SUMMARY Section 415(b) of the Internal Revenue Code (IRC) sets an annual limit on the amount of retirement pension benefits that may be paid to each retiree from a tax-qualified pension plan, including the Orange County Employees Retirement System (OCERS). Beginning January 1, 2005, the indexed limit is $170,000 annually. This amount is reduced on an actuarial basis for non-safety members who retire before age 62. This rule was designed to curb excessive deductions and benefits in the private sector, but it also applies to public sector employees. However, while establishing the pension limitation, the IRC also provides that employers may establish a replacement benefits plan that directly pays the benefits otherwise earned by and payable to its employees by OCERS but which are limited by the rules of Section 415(b). California law requires each county and district to provide a replacement benefits program. This assures payment of legally promised benefits under state law, and complies with tax law rules. The attached staff report and related documents provide additional details regarding the Section 415(b) limitation and establishment of a Replacement Benefits Plan for the Orange County Sanitation District. PRIOR COMMITTEE/BOARD ACTIONS N/A Book Page 71 PROJECT/CONTRACT COST SUMMARY No costs will occur prior to FY 2006-2007 except for outside legal services; these costs are estimated to be approximately $10,000 and include consultations, preparation of documents as well as applicable agreements. Plan costs are anticipated to first occur in the latter part of FY 2006-2007 and are estimated to be approximately $18,000. Plan costs are redetermined annually for each plan participant. BUDGET IMPACT D This item has been budgeted. (Line item: ) D This item has been budgeted, but there are insufficient funds. D This item has not been budgeted. [gj Not applicable (information item) ADDITIONAL INFORMATION See attached Staff Report and associated Replacement Benefits Plan documents. ALTERNATIVES Not to establish a Replacement Benefits Plan and be out of compliance with County Employees Retirement Law of 1937 Code requirements. CEQA FINDINGS NIA ATTACHMENTS 1 ) Staff Report 2) Draft Orange County Sanitation District (OCSD) Replacement Benefits Plan 3) Draft Memorandum of Understanding between OCSD and Orange County Employees Retirement System (OCERS) regarding OCSD Replacement Benefit Plan 4) Resolution No. 05-_, OCSD Replacement Benefit Plan Book Page 72 Replacement Benefits Plan (Plan) Page 2 June 8, 2005 The impacts of the 415(b) rule are somewhat mitigated by a "grandfather" provision in the law. This provision allows employees hired before January 1, 1990 to retain the maximum pension amount earned under the retirement formula in effect on October 14, 1987. If a higher benefit formula becomes effective at a later date, as is the case with OCSD, and if benefits are limited under the new formula due to section 415(b), the employer is only responsible for replacing the difference between the grandfathered pension amount and the earned pension under the new formula. This reduces the amount that must be funded by the employer. As the law is clear that the District must provide a program to replace benefits that cannot be paid by OCERS, a Replacement Benefit Plan (the "Plan") has been drafted. The Plan provides for pension benefits to be paid by OCERS up to the maximum allowed per year under section 415(b) or the "grandfathered" amount. When the maximum is reached, the retiree receives retirement benefits through the OCSD Plan for the remainder of the year. At the beginning of the next calendar year, pension benefits resume from OCERS and cease to be provided through OCSD's Plan until the annual maximum has again been reached. Replacement benefits are funded by OCSD general assets; no funds can be held in trust or set aside for the exclusive benefit of participants and their beneficiaries. There is no budget impact to OCSD for FY 2005-2006 as the only retiree affected will be retiring in July 2005 and will not reach the calendar year maximum in 2005. However, there are outside legal fees estimated to be approximately $10,000 for consultations, preparation of applicable documents and agreements. The limitation should first be reached during the latter part of 2006 and, therefore, the necessary Plan funds can be included in the FY 2006-2007 budgeted expenses for retirement. It is anticipated that the cost of the Plan in FY 2006-2007 will be approximately $18,000. The total amount budgeted for retirement costs for FY 2005-2006 is $9,400,000. RECOMMENDATION It is recommended that a Replacement Benefits Plan and associated Board Resolution be adopted by OCSD to comply with Government Code Section 31899.4 of the County Employees Retirement Law of 1937, Replacement Benefits Program. It is further recommended that OCSD and OCERS enter into a Memorandum of Understanding agreement to facilitate the efficient operation of the Plan. Book Page 74 ORANGE COUNTY SANITATION DISTRICT REPLACEMENT BENEFITS PLAN Copyright Hanson, Bridgett, Marcus, Vlahos & Rudy LLP 2003-2005 Book Page 75 5/15/05 5/15/05 TABLE OF CONTENTS Article 1 -Establishment and Status of Plan ....................................... 1 Article 2 -Definitions ........................................................................... 2 Article 3 -Participation ........................................................................ 3 Article 4 -Retirement Benefits Payable .............................................. 4 Article 5 -Exemption from Process; Assignments Prohibited .............. 7 Article 6 -Administration ..................................................................... 8 Article 7 -Source of Benefits .............................................................. 10 Article 8 -Miscellaneous ..................................................................... 11 Article 9 -Amendment or Termination of Plan .................................... 12 Copyright Hanson, Bridgett, Marcus, Vlahos & Rudy LLP 2003-2005 Book Page 76 ORANGE COUNTY SANITATION DISTRICT REPLACEMENT BENEFITS PLAN Article 1 -Establishment and Status of Plan 1.1 Establishment 5/15/05 The Orange County Sanitation District hereby establishes and adopts a retirement plan entitled the "Orange County Sanitation District Replacement Benefits Plan" (the "Plan") to provide the annual retirement benefits otherwise earned by and payable to its employees who are members of the Orange County Employees' Retirement System ("System") but which are limited by the rules of Section 415(b) of the Internal Revenue Code of 1986, as amended ("Code"). System is a tax qualified retirement plan under Section 401 (a) of the Code and is a governmental plan as defined in Section 414(d) of the Code. 1.2 Effective Date This Plan shall be effective, and benefits shall be payable from this Plan, for periods beginning as of July 1, 2005 or as of such later date on which this plan is made effective by the Board of Directors for retired Members who were employees of the District, as provided herein. 1.3 "Portion of System" This Plan shall be deemed a "portion" of the System solely to the extent required by, and within the meaning of, Section 415(m)(3) of the Code as in effect on January 1, 2005, and not for any other purpose. 1.4 Purpose and Tax Status of this Plan (a) In accordance with Section 415(m) of the Code, this Plan is solely for the purpose of providing to eligible retired Members of the System, and to their Eligible Survivors, that part of the annual benefit otherwise payable by the System that exceeds the limitations on benefits imposed by Section 415(b) of the Code. (b) It is intended that this Plan be treated as an "exempt governmental deferred compensation plan" described in Section 3121 (v)(3) of the Code; therefore, payments under this Plan are not included as wages subject to Social Security and Medicare taxes. (c) No assets directly or indirectly relating to this Plan shall be held in trust, or otherwise held or set aside for the exclusive benefit of participants and their beneficiaries. This Plan shall be unfunded within the meaning of the federal Copyright Hanson, Bridgett, Marcus, Vlahos & Rudy LLP 2003-2005 BookPage 77 ORANGE COUNTY SANITATION DISTRICT REPLACEMENT BENEFITS PLAN income tax laws. Article 2 -Definitions 2.1 Plan Definitions Terms used in this Plan shall have the meaning set out below. Beginning Date means the first date during a Plan Year with respect to which payment begins under this Plan. Board of Directors means the Board of Directors of the Orange County Sanitation District. GERL means the County Employees Retirement Law of 1937 as set out in the California Government Code, as amended. Code means the Internal Revenue Code of 1986, as amended, and any rules and regulations issued thereunder. Commencement Date means the date of commencement of participation in this Plan as set out in Section 3.2 hereof. District means the Orange County Sanitation District. Effective Date means the first date with respect to which benefits are payable under this Plan as set out in Section 1.2 hereof. Eligible Survivor means the surviving spouse, surviving child or children, surviving parent or parents, or surviving beneficiary designated by the Member, to whom benefits are payable from System on the death of the Member. Member means a member, as defined in the GERL, of the System who was an employee of the District immediately prior to retirement under the System or for whom the District was his/her last employer that was a System participating agency. Participant means a retired Member who participates in this Plan pursuant to Article 3 hereof. An Eligible Survivor is not a Participant in this Plan, but is a beneficiary who receives benefits under this Plan with respect to a Participant or Member. Plan means this Orange County Sanitation District Replacement Benefits Plan. Plan Administrator means the Orange County Sanitation District. 5/15/05 2 Book Page 78 ORANGE COUNTY SANITATION DISTRICT REPLACEMENT BENEFITS PLAN Plan Year means the 12-month period beginning on January 1 and ending on December 31. Section 415 means Section 415 of the Code. System means the Orange County Employees' Retirement System. Article 3 -Participation 3.1 System Members With Benefits Limited by Section 415(b) Participation in this Plan is limited solely to retired Members whose benefits payable by the System are limited by Section 415(b) for periods on and after the Effective Date. 3.2 Commencement of Participation Subject to the terms and conditions of this Plan, a retired Member shall commence participation in this Plan on the first date, on or after the Effective Date, for which his or her benefits payable from the System cannot be fully paid because of the limits of Section 415(b). This date is the Commencement Date. 3.3 Cessation of Participation Participation in this Plan shall cease on the first date for which benefits payable to the retired Member from the System are no longer limited by Section 415(b) and therefore can be fully paid by the System. Participation shall also cease on the retired Member's death or when the retired Member's System benefits cease. 3.4 Recommencement of Participation If a Participant has ceased participation in this Plan but at a later date the full payment of his or her System benefits is again limited by Section 415(b ), he or she shall again commence participation as provided in Section 3.2 hereof and shall cease participation as provided in Section 3.3 hereof. 3.5 Eligible Survivors Any Eligible Survivor of a Member shall receive benefits under this Plan on the first date (on or after the Effective Date) on which benefits payable to him/her from the System cannot be fully paid because of the limits of Section 415(b). The Eligible Survivor's benefits paid under this Plan shall cease on the first date for which his or her System benefit is no longer limited by Section 415(b) and therefore can be fully paid by the System. The Eligible Survivor's benefits under this Plan shall recommence at a later date if full payment of his/her System 5/15/05 3 Book Page 79 ORANGE COUNTY SANITATION DISTRICT REPLACEMENT BENEFITS PLAN benefits is again limited by Section 415(b ), and shall thereafter cease on the next date that full payment of the System benefit is no longer limited by Section 415(b). An Eligible Survivor's benefit shall also cease on his/her death or when his/her System benefits cease. 3.6 No One Else Shall Receive Benefits No one other than a person described in this Article shall receive any benefits under this Plan , except as required by qualified domestic relations orders or governing law. Article 4-Retirement Benefits Payable 4.1 Amount of Benefit - Initial Determination (a) The benefit paid under this Plan in any Plan Year shall be initially determined for each Participant at the Participant's Commencement Date under the following steps. (1) Determine the Participant's benefits payable at the time of the Commencement Date by the System without regard to the limits of Section 415(b) and after taking into account the form of System benefit selected by the Participant. (2) Determine the amount of the Participant's System benefits (if any) attributable, at the Commencement Date, to after-tax Member contributions, rollovers and direct transfers which are excluded from the limits of Section 415(b), after taking into account the form of System benefit selected by the Participant. (3) Subtract the amount determined in (2) from the amount determined under (1); this is the amount subject to the Section 415(b) limits for the Participant. (4) Determine the maximum benefits payable to the Participant from the System under the then current benefit payment limits of Section 415(b ), ignoring any benefits determined under (2). The determination under this step (4) shall take into account items such as the applicable dollar limits, the form of benefit payment chosen, the date that the Participant first became a Member, and whether he or she qualifies for special limits under Section 415(b) such as those for certain safety members. (5) Subtract the amount determined under (4) from the amount determined under (3). If the amount in (3) is greater than the amount in (4), the difference is the initial benefit paid under this Plan for the Plan Year in which the 5/15/05 4 Book Page 80 ORANGE COUNTY SANITATION DISTRICT REPLACEMENT BENEFITS PLAN Commencement Date occurs. If the amount in (4) is equal to or greater than the amount in (3), then no benefits are payable under this Plan. (b) The total retirement benefit that will be paid to a Participant in any year will be the sum of the benefit paid under this Plan and the benefit paid by the System, including amounts attributable to both District and after tax Member contributions. Therefore, the total retirement benefit that will be paid to a Participant under this Plan and the System is the sum of the amounts in (2), (4) and (5) above. However, this Plan and the System shall be separate entities and shall be administered separately. In addition, separate checks will be paid for the benefits under this Plan and the System; the Plan Administrator shall provide separate tax reporting for the benefits paid under this Plan; and no assets of the System shall be used, directly or indirectly, to pay for benefits or administration or any other costs of this Plan. (c) The Plan Administrator shall rely on the determination by the System, for purposes of administering the System in accordance with Section 415(b), of the amounts set out under each of steps (1) through (5) in paragraph (a) of this Section. 4.2 Amount of Benefit -Redeterminations (a) As of each January 1 following the Participant's Commencement Date (or the date of commencement of benefits under this Plan for any Eligible Survivor), the Participant's, or Eligible Survivor's, benefit under this Plan shall be redetermined by following each of steps (1) through (5) of Section 4 .1 (a), but using the then current amounts determined by applying (i) cost of living adjustments and other changes (if any) to the benefits provided under the System, and (ii) cost of living adjustments, and other changes (if any) to the maximum benefit limits established by Section 415(b). (b) At the Plan Administrator's discretion, the amount of every Participant's and Eligible Survivor's benefits may be redetermined at a date other than January 1 for administrative convenience or if there is a material change in the rules governing the maximum benefit limits established under Section 415(b) or a material change in System benefits. (c) The Plan Administrator shall rely on the redetermination by the System, for purposes of administering the System in accordance with Section 415(b), of any amounts in this Section. 4.3 Amount of Benefit - Eligible Survivors Eligible Survivors shall be entitled to benefits under this Plan as follows: 5/15/05 5 Book Page 81 ORANGE COUNTY SANITATION DISTRICT REPLACEMENT BENEFITS PLAN (a) Eligible Survivors shall be entitled to benefits under this Plan only if they are entitled to benefits that are limited by Section 415(b) under System after the death of a Member or Participant. (b) The benefit paid to an Eligible Survivor under this Plan shall be determined as if he or she were the Participant, substituting in the calculations under Sections 4.1 or 4.2, as applicable, the amounts due to the Eligible Survivor for the amounts due to the Participant. 4.4 Timing of Payments (a) In any Plan Year, benefits shall only be paid under this Plan to a Participant or Eligible Survivor after the date in the Plan Year that the benefits paid to such person from the System have reached the maximum annual benefit that the System can pay under Section 415(b) for that Plan Year. The day after the maximum annual benefit payment from the System is reached is the Beginning Date for the Participant or Eligible Survivor for that Plan Year. The Beginning Date may change from Plan Year to Plan Year as the amount payable under this Plan is redetermined. (b) The amount of benefits provided under this Plan shall be paid monthly starting as of the Beginning Date and continuing through the end of the Plan Year, or (if earlier) the date that Participation ceases (or, for an Eligible Survivor, the date that the benefits would cease if the Eligible Survivor were treated as a Participant) (c) If a retired Participant is reemployed by the District and on reemployment his or her System benefits cease, then his or her benefits under this Plan shall cease at the same time. Benefits shall resume (if at all) under this Plan when the Member again starts to receive benefits under the System. At that time, a recalculation shall be made under Section 4.2 hereof, treating the first month for which System benefits resume as if it were a date of redetermination under Section 4.2. Similar rules shall apply if the benefits of an Eligible Survivor under the System cease (or resume) under the System for any reason, including without limitation ceasing to be an Eligible Survivor. 4.5 Form of Benefit Paid The benefit paid to a Participant or Eligible Survivor under this Plan shall be paid in the same form as benefits are paid to him or her by the System. For example, if the System benefit is paid as a 100% pension to the Member and 60% survivor benefit to his or her surviving spouse, the same benefit form shall be paid under this Plan. 4.6 Taxes 5/15/05 6 Book Page 82 ORANGE COUNTY SANITATION DISTRICT REPLACEMENT BENEFITS PLAN The Plan Administrator shall have full authority to withhold any and all taxes that are or may be due from any and all amounts paid under the Plan (including but not limited to income and payroll taxes), to pay them to the appropriate government agency, and to file and distribute necessary or appropriate tax reports and forms. 4.7 Determination Solely By Plan Administrator Subject to Sections 4.1 and 4.2 hereof, the Plan Administrator shall have sole authority and discretion to determine the amount of benefits (if any) payable under this Plan. 4.8 Condition For Paying Benefits No amount shall be paid to any person under this Plan unless such person provides, or makes readily available, to the Plan Administrator all information necessary or appropriate to provide such benefits, including but not limited to information concerning his or her benefits provided under the System and the information used by the System for determining those benefits. Article 5 -Exemption from Process; Assignments Prohibited 5.1 Prohibition Against Assignment No benefit payable from the Plan to any Participant or Eligible Survivor or any other person shall be subject in any manner to anticipation, alienation, sale, transfer, assignment, pledge, encumbrance, or charge, and any attempt to anticipate, alienate, sell, transfer, assign, pledge, encumber, or charge the same shall be void. No such benefit shall in any manner be liable for, or subject to, the debts, contracts, liabilities, engagements, or torts of any such person, nor shall it be subject to execution, attachment or any process whatsoever for or against such person, except to such extent as may be permitted by Section 704.110 of the Code of Civil Procedure or as required by law. Nothing in this Plan shall prohibit a Participant or Eligible Survivor from voluntarily agreeing to the assignment of benefits payable under this Plan. Such assignment shall be in accordance with rules established by the Plan Administrator and may be by payroll withholding or any other mechanism that is approved by the Plan Administrator, at its sole discretion. 5.2 Payment Upon Marita l Dissolution or Legal Separation The provisions of Section 5.1 will not apply in the case of any property settlements upon marital dissolution or legal separation which are made in 5/15/05 7 Book Page 83 ORANGE COUNTY SANITATION DISTRICT REPLACEMENT BENEFITS PLAN accordance with a domestic relations order (ORO) issued in accordance with state domestic relations law. The provisions of Section 5.1 will apply in the case of any property settlement upon marital dissolution or legal separation which is made in accordance with a domestic relations order that is not qualified in accordance with this Section. When the Plan Administrator receives a domestic relations order, the Plan Administrator shall: (a) Notify the Participant (or Eligible Survivor) and the former spouse or dependent covered by the domestic relations order of the receipt of the order with a notice which explains the procedures for determining the qualified status of domestic relations orders; and (b) Under procedures established by the Plan Administrator, determine the qualified status of the domestic relations order. For purposes of this Section, "domestic relations order" or "ORO" means any judgment, decree, or order made in accordance with state domestic relations law which relates to the provision of child support, spousal maintenance, or marital property rights of any spouse, former spouse, child , or other dependent of a Participant. A domestic relations order shall not be considered a ORO with respect to this Plan if it is inconsistent with the Plan. To the extent practicable, the rules under the GERL governing the treatment of a qualified domestic relations order shall equally govern payment of benefits under this Plan . Article 6 -Administration 6.1 Powers of the Plan Administrator The District shall administer the Plan, and in such capacity shall be the Plan Administrator. In addition to the powers of the Plan Administrator specified elsewhere in the Plan, the Plan Administrator shall be responsible for the general administration and interpretation of the Plan and for carrying out its provisions, and shall have such powers as may be necessary or appropriate to discharge its duties hereunder, including, without limitation, the following: 5/15/05 8 Book Page 84 ORANGE COUNTY SANITATION DISTRICT REPLACEMENT BENEFITS PLAN (a) The Plan Administrator may adopt such Plan regulations, interpretations and procedures as it deems are necessary or appropriate for the effective operation of the Plan; (b) The Plan Administrator shall have the right to delegate administrative duties with regard to the management and operation of the Plan. However, no employee or agent of the Plan Administrator shall have the authority to modify this Plan or to make representations, warranties, or inducements that may provide benefits or any other payment other than as set forth in this Plan and any applicable Plan regulations. Any such representations, warranties, or inducements shall be null and void. (c) The Plan Administrator shall act with respect to this Plan separately and apart from any duties that he or she may have with respect to any other retirement plan. (d) The Plan Administrator shall determine all issues relating to the rights of Participants and Eligible Survivors and any other persons, and any legal representatives thereof, under the terms of the Plan, including but not limited to eligibility, the amount and time of payment of the benefit (if any) and the calculation of any benefit under the Plan; (e) The Plan Administrator shall determine any factual questions arising in connection with the Plan's operation or administration after such investigation or hearing as the Plan Administrator deems necessary and appropriate;. (f) The Plan Administrator may engage legal, administrative, actuarial, accounting, consulting or other services as the Plan Administrator deems necessary or appropriate; and (g) The Plan Administrator may request and receive from the District, Members and Participants and any other appropriate persons such information as necessary or appropriate for the proper administration of the Plan, including, without limitation, information to determine each Participant's eligibility to participate in the Plan and the benefits payable to each Participant or his or her Eligible Survivor. 6.2 Absolute Discretion of the Administrator. The Plan Administrator (or any individual acting on its behalf) shall, in its sole and absolute discretion, construe and interpret the terms and conditions of the Plan, and any issue arising out of, relating to, or resulting from the administration and operation of the Plan, which interpretation or construction shall be final and binding on all parties, including, without limitation, District, Member, Participant or Eligible Survivor. When making a determination or calculation, the Plan Administrator shall, in its sole and absolute discretion, be entitled to rely upon 5/15/05 9 Book Page 85 ORANGE COUNTY SANITATION DISTRICT REPLACEMENT BENEFITS PLAN information furnished by District, Members, Participants and Eligible Survivors or other individuals acting on their behalf. 6.3 Costs of Ad ministration The costs of administration of the Plan shall be paid by the District. Such expenses shall include, but are not limited to, expenses for professional, legal, accounting, and other services and other necessary or appropriate costs of administration. No costs or expenses of administering this Plan shall be paid, directly or indirectly, by the System. Further, no assets of theSystem shall be used, directly or indirectly, to pay for benefits or administration or any other costs (direct or indirect) of this Plan. 6.4 Claims Review Procedure Any person who has a claim for benefits under this Plan and who does not receive such benefits must make a written claim for benefits with the Plan Administrator at the time and in the form and manner determined by the Plan Administrator. The Plan Administrator shall provide notice in writing to any person whose claim for benefits under the Plan is denied, and the Plan Administrator shall review its decision with respect to such claim, if requested in writing by the person who has made the claim. The decision of the Plan Administrator shall be final and binding on all parties. 6.5 Correction of Errors If an error or omission is discovered in the administration of the Plan, the Plan Administrator shall take such necessary or appropriate and equitable action as may be necessary or appropriate to correct the error. Such action shall include, but not be limited to, taking all reasonable or necessary action to recover overpayments of benefits (plus interest) under the Plan. 6.6 Written Communications Mailed All written notices or communications to Participants and Eligible Survivors and any other person who may be entitled to benefits under this Plan shall be effective when sent by first class United States mail, postage prepaid, to the individual's last known address. Any notice or document required to be given to or filed with the Plan Administrator shall be properly given or filed if delivered or sent by first class United States mail, postage prepaid, to the District's Director of Finance. Article 7 -Source of Benefits 7.1 Unfunded Plan 5/15/05 10 Book Page 86 ORANGE COUNTY SANITATION DISTRICT REPLACEMENT BENEFITS PLAN (a) The Plan shall be unfunded within the meaning of the federal tax laws. Ownership of any assets, whether cash or other investments which might be used to pay any amount under the Plan, shall at all times remain solely in the District. Participants and Eligible Survivors and any other persons who might be entitled to amounts under this Plan shall not have any property interest, preferred claims, liens or any other beneficial interest whatsoever in any assets of the District, and shall have only general creditor status with respect to the District. Any rights created under this Plan shall be merely unsecured contractual rights against the District. (b) Benefits due under this Plan shall be paid by the District from its general assets, which are subject to the claims of the District's general creditors. The District shall also pay all costs, charges and expenses relating to this Plan from the same asset sources. 7 .2 No Employee Deferrals No employee contributions or deferrals shall be made or allowed under the Plan at any time. In accordance with Section 415(m), no election to defer compensation under this Plan shall be provided, at any time or in any manner, to any person. 7.3 No Use of System Assets District assets used to provide benefits under this Plan shall not be commingled with the monies of the System or any other qualified plans, nor shall this Plan ever receive or use any assets of the System. Article 8 -Miscellaneous 8.1 Applicable Law This Plan shall be governed by the laws of the State of California and applicable federal law. 8.2 No Service Rights Nothing in this Plan or in any resolution or regulation concerning this Plan shall be construed as giving to a Participant any right to be retained in the service of the District. 8.3 Unclaimed Benefits and Accumulations In any situation where benefits are payable under this Plan, a reasonable search, 5/15/05 11 Book Page 87 ORANGE COUNTY SANITATION DISTRICT REPLACEMENT BENEFITS PLAN including mailing of a registered letter to the last known address, shall be made to ascertain the whereabouts of the Participant or Eligible Survivor. If the person or persons entitled thereafter come forward and request payment and establish such entitlement, the amounts then due, including appropriate retroactive payments from the Commencement Date (but without payment of any interest thereon), shall be paid accordingly. 8.4 Benefit Limits (a) Nothing in this Plan shall be construed as creating an entitlement to any benefits greater than the difference between the amount of benefits that can be paid by the System without regard to the limitations of Section 415 and what can be provided by the System taking into account the limitations of Section 415. (b) Payment of a benefit under this Plan does not create any eligibility for any additional benefits provided by this Plan, by the System or under any other program maintained by the District. Article 9 -Amendment or Termination of Plan 9.1 Right to Amend The District has the right to amend this Plan at any time and in any manner for any reason whatsoever and may do so in its sole discretion, provided that no amendment shall retroactively adversely affect the benefits of any Participant or Eligible Survivor (except to the extent required to meet the requirements of sections 9.2 and 9.3). However, any amendment to this Plan that affects benefits paid shall be commensurate with the purposes of this Plan to provide Participants and Eligible Survivors with retirement benefits that are otherwise earned by and payable to members of the System but which are limited by the rules of Section 415 of the Code. 9.2 Preservation of System Tax Status This Plan shall not in any way jeopardize the tax qualified status of the System. To maintain this qualified status, the District shall take all necessary or appropriate action, including but not limited to amending this Plan and the rules governing this Plan, solely for the purpose of complying with applicable tax laws and regulations. 5/15/05 12 Book Page 88 ORANGE COUNTY SANITATION DISTRICT REPLACEMENT BENEFITS PLAN 9.3 Preservation of Section 415(m) Status The District shall have the authority to make appropriate amendments to the Plan in order to accommodate changes in the Internal Revenue Code and United States Treasury Regulations in a manner that will preserve the status of the Plan under Section 415(m) of the Internal Revenue Code. IN WITNESS WHEREOF, THIS PLAN IS EFFECTIVE AS OF July 1, 2005 AND HAS BEEN EXECUTED ON THE ______ DAY OF ____ _ 2005. ORANGE COUNTY SANITATION DISTRICT BY ------------ TITLE ------------ 5/15/05 13 Book Page 89 Book Page 90 5/15/05 MEMORANDUM OF UNDERSTANDING BETWEEN THE ORANGE COUNTY SANITATION DISTRICT AND THE ORANGE COUNTY EMPLOYEES' RETIREMENT SYSTEM REGARDING THE ORANGE COUNTY SANITATION DISTRICT REPLACEMENT BENEFITS PLAN This Memorandum of Understanding ("MOU") is entered into by and between the Orange County Employees' Retirement System ("System") and the Orange County Sanitation District ("District") to be effective beginning on July 1, 2005. WHEREAS, System provides retirement benefits to retired employees of the District, and WHEREAS, the amount of retirement benefits that can be provided to System members is limited by Section 415(b) of the Internal Revenue Code ("section 415(b)" and "Code", respectively), and WHEREAS, the Internal Revenue Code allows the District to establish a replacement benefits plan to pay the full benefits earned by System members whose benefits are limited by Section 4 l 5(b ), and the Government Code requires the District to provide a program to replace benefits that that cannot be paid by the System because of the limits of section 415(b) of the Code, and WHEREAS, such a replacement benefits plan is used by many other entities, in both the pri\'ate and public sector, to replace benefits limited by section 415(b ), and WI IE REAS, it is to the benefit of System to ensure that all of its members receive the entire retirement benefits which they would earn under System but for the limits of the Code. and WI IEREAS, the most efficient way for the District to operate a replacement benefits plan is to enter into a memorandum of understanding with System setting out the n:sponsibilities of the District and System with respect to such a plan, and WI 11:REAS, the District has provided to System the District's Replacement Benefits Plan, a cop) of which is attached hereto. Tl IEREFORE, IT IS HEREBY AGREED BY AND BETWEEN THE ORANGE COl lNTY SANITATION DISTRICT ("District") AND THE ORANGE COUNTY EMPLOYEES' RETIREMENT SYSTEM ("System") AS FOLLOWS: I. Purpose of Agreement This memorandum of understanding ("MOU") is entered into by the District and System in order to facilitate the efficient operation by the District of a replacement benefits plan ( .. Plan") that will provide benefits to retired System members and their eligible beneficiaries whose retirement benefits are limited by Section 415(b) of the Internal Revenue Code ("Code"). 5/15/05 Book Page 91 2. Payment of Replacement Ben efit s (a) In accordance with the Plan, the District shall pay to affected retired members of System who were employees of the District immediately prior to their retirement ( or for whom the District was his/her last employer that was a System participating agency) ("Retirees"), and to their eligible surviving beneficiaries (if any), the difference between the benefits that would be payable by System without regard to the limits of Section 415(b) of the Code and the benefits that may be paid by System without violating Section 415(b ). These benefits are called "replacement benefits". (b) The District shall pay replacement benefits to Retirees from its general assets. No assets of System shall be used to pay replacement benefits and no assets of System shall be used to pay the cost of administration or any other costs regarding the operation of the Plan. 3. Determination of Amount of Replacement Benefits (a) In accordance with its responsibilities under Section 31899 et seq of the Government Code and Section 415(b), System shall determine the amount of benefits for any affected Retiree and eligible surviving beneficiaries that would be paid from System without the limits of Section 415(b ), and shall determine the amount of the benefits that can be paid to such persons in accordance with the limits of Section 415(b ). The difference between these two amounts (if any) is the amount ofreplacement benefits payable by the District under the Plan. (b) System shall make this determination for the first year that the benefits of any affected Retiree or eligible surviving beneficiary are limited by Section 415(b) and for each relevant year thereafter. (c) To the extent that the amount of benefits that are limited by Section 415(b) change during the year, and in accordance with its responsibilities under the Government Code and Section 415(b), System shall recalculate the benefits payable by the District under the Plan. ( d) Because System has the expertise, experience and data needed to make these calculations, because System must make these calculations in any event to maintain its tax qualified status, and to ensure coordination between the System and the District, the District shall rely on the calculations by System set out in paragraphs (a), (b), and (c) of this section for purposes of determining the replacement benefits payable under the Plan. (e) As provided in Section 5 of this MOU, System shall communicate to the District the information determined under this Section 3. 4. Effect on District Contributions To System of Section 415(b) Limits Upon recommendation of System's actuary and in accordance with its obligation to recommend District contribution rates under Sections 31453 and 31453 .1 of the 5/15/05 Book Page 92 2 Government Code, System shall adjust the contributions required to be contributed by the District to take account of the limits of section 41 S(b ). 5. Communications Between District and System (a) System shall communicate to the District, in writing and as soon as reasonably practicable, all information known to System that is necessary or appropriate for the efficient administration of the Plan. (To the extent required by law, no information shall be provided by System to District without the prior written consent of the Retiree or eligible surviving beneficiary.) This information may include, but is not limited to, the following: the names and identifying numbers of the Retirees and eligible surviving beneficiaries whose benefits are limited by Section 415(b) in any year; the amounts of their replacement benefits (if any) and the calculations that support these amounts; the date as of which the replacement benefits will become payable during each year (if any); the amount by which the replacement benefits change during the year (if at all); the amount of reduction in the District's contribution to System that will occur under section 4 hereof; and the date that any replacement benefits must cease (for example, on the death of the retired member). The District shall keep confidential all information received from System for the purpose of administering the Plan, to the extent permitted by law. (b) The District shall communicate to System, in writing and as soon as reasonably practicable, all information that is necessary or appropriate for the efficient administration of the System. (To the extent required by law, no information shall be provided by the District to System without the prior written consent of the Retiree or eligible surviving beneficiary.) This information may include. but is not limited to, the following: the names and identifying numbers of the Plan participants and eligible surviving beneficiaries who are paid replacement benefits; the amount of such payments; and the dates on which such payments occurred during the year. 6. Communications With Members (a) In accordance with its responsibilities under the Government Code and Section 415(b ), System shall be responsible for testing member benefits with respect to the Section 415(b) limits. If the benefits of a Retiree or eligible surviving beneficiary are limited by Section 415(b), System will so inform the affected individual in writing, and will generally inform him or her that the Plan will provide replacement benefits. (b) Upon receiving the needed information from System with respect to the amounts and timing of payment of replacement benefits for any Retiree or eligible surviving beneficiary, the District shall inform each affected individual about how the Plan works with respect to him or her, including the amounts that will be paid under the Plan for the particular year, the timing of such payments, any tax withholding elections available and all other information that is necessary or appropriate for operation of the Plan as determined by the Plan Administrator in its discretion. 7. Reconciliation of Amounts (a) Reconciliation of payments between System and the District 5/15/05 Book Page 93 3 The District and System shall take all reasonable steps to reconcile, after the end of each calendar year, the amounts of replacement benefits that have been identified as payable under the Plan by System and the amounts of replacement benefits that have actually been paid under the Plan. In the event that the Plan has paid benefits which System determines should have been paid by System within the limits of section 415(b ), System shall reduce the contributions otherwise due to System from the District as soon as reasonably practical in an amount equal to such payments. In the event that System has paid benefits which System determines should have been paid under the Plan, the District shall immediately reimburse System for the payments of such benefits by System plus interest thereon calculated by using the System's then current actuarial valuation interest rate assumption. (b) Underpayments or overpayments to Retirees Underpayments or overpayments of benefits under this Plan to Retirees and eligible surviving beneficiaries shall be corrected by the District in accordance with the Plan or as required by law. It shall be the District's responsibility to collect any such overpayments (plus interest) and to pay any such underpayments. The District shall not seek any recourse against System relating to such overpayments or underpayments except to the extent that System is required to reimburse the District as provided in section 7(a) above. 8. Tax Reporting System and the District shall be separately responsible for their required reporting to the tax authorities, and neither shall be responsible for the other's reporting. 9. Costs of Administration and Payment of Benefits The costs of administration of the Plan shall be paid by the District. No costs or expenses (direct or indirect) of administering this Plan (direct or indirect) shall be paid, directly or indirectly, by the System. Further, no assets of the System shall be used, directly or indirectly. to pay for benefits or any other costs (direct or indirect) of this Plan. I 0. Indemnification and Hold Harmless To the extent allowed by applicable law, each party to this MOU shall indemnify and hold the other harmless for any costs, damages, or other liabilities incurred hereunder on account of its own negligence or willful misconduct. 11. Miscellaneous (a) Integration. This Memorandum of Understanding and the documents referenced herein constitute the entire agreement of the parties with respect to the subject matter hereof and supercede all prior agreements and understandings, both written and oral. 5/15/05 Book Page 94 4 (b) Amendment to MOU This Memorandum of Understanding may only be amended pursuant to a written agreement executed by both parties hereto. (c) Notice of Amendment to Plan The District will provide 30 days' written notice to System of any proposed revision to the Plan. Notice shall be addressed to the Chief Executive Officer. (d) Termination of MOU This MOU shall be effective beginning on the date set out on the first page hereof and shall continue in effect unless and until terminated by either party on 30 days written notice to the other. Notice shall be addressed to the Director of Finance, for the District, and to the Chief Executive Officer, for System. (e) One year review The District and System will meet within one year from the first date that benefits are paid under the Plan to review the operations of this MOU and to make such revisions hereto as are mutually agreeable. (f) Authority to execute agreement The District and System each represent and warrant that the person executing this Agreement on its behalf as indicated below has full power and authority to do so. IN WITNESS WHEREOF, THIS MEMORANDUM OF UNDERSTANDING HAS BEEN ENTERED INTO AS OF THE DATE SET FORTH ON THE FIRST PAGE HEREOF. ORANGE COUNTY SA.NIT ATION DISTRICT By __________ _ Title ---------- 2005 --------· 5115105 ORANGE COUNTY EMPLOYEES' RETIREMENT SYSTEM By ________ _ Title ---------- -------, 2005 Book Page 95 5 RESOLUTION NO. OCSD 05-XX ESTABLISHMENT OF REPLACEMENT BENEFITS PLAN A RESOLUTION OF THE BOARD OF DIRECTORS OF ORANGE COUNTY SANITATION DISTRICT AUTHORIZING GENERAL MANAGER TO ADOPT A REPLACEMENT BENEFITS PLAN IN COMPLIANCE WITH COUNTY EMPLOYEES RETIREMENT LAW OF 1937. *********** WHEREAS, the Orange County Employees' Retirement System ("System") provides retirement benefits to employees of the Orange County Sanitation District ("District"), and WHEREAS, the amount of benefits that can be provided to System members is limited by Section 415(b) of the Internal Revenue Code ("Code"), and WHEREAS, the Internal Revenue Code provides that the District can establish a replacement benefits plan to pay the full benefits earned by System members whose benefits cannot be paid by System under Section 415(b), and it is the District's responsibility under the County Employees Retirement Law of 1937 ("GERL") to provide a program to replace benefits that cannot be paid by the System because of the limits of section 415(b) of the Code, and WHEREAS, such a replacement benefits plan is used by many other entities, in both the private and public sector, to replace benefits limited by section 415(b), and WHEREAS, it would be to the benefit of the District to ensure that all of its employees receive the entire retirement benefit which they would earn under the System but for the limits of the Code, and WHEREAS, the most efficient way for the District to operate a replacement benefits plan is to enter into a memorandum of understanding with System setting out the responsibilities of the District and System with respect to such a plan, NOW THEREFORE, the Board of Directors of the Orange County Sanitation District DOES HEREBY RESOLVE, DETERMINE AND ORDER: BookPage 97 1. That the General Manager be authorized to adopt the Orange County Sanitation District Replacement Benefits Plan ("Plan") in a form that is similar to the draft Plan that is presented to the Board and attached to this Resolution. The effective date of the Plan shall be July 1, 2005. Such action shall be taken as soon as reasonably practical. After adoption, the General Manager shall file a copy of the executed Plan with the Secretary to the Board of Directors. 2. That the General Manager be authorized to delegate the administration of the Plan as he sees fit, including, but not limited to, entering into an agreement with the Orange County Employees' Retirement System for such administration. Such delegation may change at the discretion of the General Manager at the time or times that he determines is necessary or appropriate. 3. That the General Manager be authorized to enter into a memorandum of understanding (MOU) between the District and the Orange County Employees' Retirement System that sets out the respective responsibilities of the District and the System with respect to the Replacement Benefits Plan. Such MOU shall be in a form that is similar to the draft MOU that is presented to the Board and attached to this Resolution. Such action shall be taken as soon as reasonably practical. After execution, the General Manager shall file a copy of the executed MOU with the Secretary to the Board of Directors. PASSED AND ADOPTED at a regular meeting held June 22, 2005. Chair ATTEST: Board Secretary Book Page 98 ORANGE COUNTY SANITATION DISTRICT (714) 962-2411 www.ocsd.com Mailing Address: P.O. Box 812 7 Fountain Valley, California 92728-8127 Street Address: 10844 Ellis Avenue Fountain Valley, California 92708-7018 FAHR COM_MllTEE AGENDA REPORT Orange County Sanitation District FROM: Gary Streed, Director of Financeffreasurer Originator: Michael White, Controller Meeting Date 6/08/05 Item Number FAHR05-46 SUBJECT: TREASURER'S REPORT FOR THE MONTH OF MAY 2005 GENERAL MANAGER'S RECOMMENDATION Receive and file Treasurer's Report for the month of May 2005. SUMMARY To Bel. of Dir. 6/22/05 Item Number Pacific Investment Management Co. (PIMCO), serves as the District's professional external money manager, and Mellon Trust serves as the District's third-party custodian bank for the investment program. Some funds are also deposited in the State of California Local Agency Investment Fund for liquidity. The District's Investment Policy, adopted by the Board, includes reporting requirements as listed down the left most column of the attached PIMCO Monthly Report for the "Liquid Operating Monies" and for the "Long-Term Operating Monies" portfolios. The District's external money manager is operating in compliance with the requirements of the Investment Policy. The portfolio contains no reverse repurchase agreements. As shown on page 2 of the attached PIMCO's Performance Monitoring and Reporting Report for the Long-Term Operating Monies, there is one investment policy compliance exception. It pertains to the holding of one security within PIMCO's Long-Term Operating Monies Portfolio that had an acceptable rating at the time of purchase but has since fallen below the minimum rating allowed by the investment policy. The District's investment policy requires a minimum rating of A3 by Moody's or A-by S&P, with at least a BBB rating in the event of a split rating, at the time of purchase. The rating exception pertains to the holding of a United Airlines (UAL) Asset Backed Security with a par value of $1.6 million, representing 0.47 percent of the portfolio holdings, whose rating from Moody's has fallen several times, from A3 to BA 1, then to BA3, 83, B, and finally to CA. Likewise, the rating from Standard & Poor's has also fallen several times, first from A-to BBB, then to BB, then to B+, 8-, and finally to CCC+. Both rating agencies have since withdrawn their ratings, Moody's in February 2004 and Standard & Poor's in June 2004. Although these ratings are less than what is required at the time of purchase, PIMCO believes, based on the financial strength of UAL and the underlying collateral of the security, that the District would suffer an unwarranted loss if the security was sold at this time. The District's investment policy does not require any action because of "credit watch" notices or the decline in credit standing. However, PIMCO will continue to monitor the credit for this security very closely. H:\depllfin\220\geggie\FAHRITREASRPT060805.doc Page 1 Historical cost and current market values are shown as estimated by both PIMCO and Mellon Trust. The District's portfolios are priced to market ("mark-to-market") as of the last day of each reportihg period. The slight differences in value are related to minor variations in pricing assumptions by the valuation sources at the estimate date. BUDGET IMPACT D This item has been budgeted. (Line item: ) D This item has been budgeted, but there are insufficient funds. D This item has not been budgeted. 1:8:1 Not applicable (information item) ADDITIONAL INFORMATION Schedules are attacmed summarizing the detail for both the short-term and long-term investment portfolios for the rep-orting period. In addition, a cons0lidated report of posted investment portfolio transactions for the month is a~ached. The attached yield analysis report is presented as a monitoring and reporting enhancement. In this report, yield calculations based on book values and market values are shown for individual holdings, as well as for each portfolio. Mellon Trust, the District's custodian bank, is the source for these reports. Transactions that were pending settlement at month end may not be reflected. Also provided is a summary of monthly investment balances and transactions within the State of California Local Agency Investment Fund (LAIF). These reports accurately reflect all District investments and are in compliance with the District's lhvestment Policy and previous requirements of California Government Code Section 53646. Government Code Section 53646 mandated that annual investment policies and quarterly reports be rendered to the legislative body. AB2'853, which was signed on September 29, 2004, amends Government Code Section 53646 to remove the requirements; the rendering of these documents is optional. Although the Annual Investment Policy and Monthly and/or Qua·rterly Reports are no longer required, we believe it prudent to continue providing the legislative bodies with these documents. In addition, Government Code Section 53607 has not been repealed that requires an annual delegation of investment authority to the Treasurer and the submission of reports that include investment transactions by month. Sufficient liquidity and anticipated revenues are available to meet budgeted expenditures for the next six months. The tables on the following page details the book balances of the District's investment accounts at month-end and a summary of the Cost of Funds on debt issues. A graphical representation of mohth-end balances is shown on the attached bar chart. H:ldeptlfinl220\geggie\FAHRITREASRPT060805.doc Page2 Book Balances Estimated Investment Accounts May 31, 2005 Yield(%) State of Calif. LAIF $ 26,032,936 2.86 Union Bank Checking Account 5,146,718 2.73(1) Union Bank Overnight Sweep Account 2,810,000 2.31 PIMCO -Short-term Portfolio 73,603,817 3.14 PIMCO -Long-term Portfolio 338,429,545 4.04 Petty Cash 4 000 N/A TOTAL $446 027 016 3.80 Debt Service Reserves w/Trustees $ 63 945 810 3.96 (1) This Is the annualized yield for the month of April. The May annualized rate was not available as of the date of this report. Cost of Funds Issue Description 1992 Syn Fixed 1993 Syn Fixed 2000VRDO 2003 Fixed TOTAL Weighted Avg Cost of Funds ALTERNATIVES NIA CEQA FINDINGS NIA ATTACHMENTS Annual Outstanding Interest COP Balance Rate(%) $ 100,275,000 5.55 42,050,000 4.56 199,000,000 2.88 280,000,000 5.15 $621325000 4.45 1. Graph of Monthly Investment Balances by Type -Last Six Months 2. Investment Transactions and Balances in the State Local Agency Investment Fund 3. PIMCO Monthly Investment Recap & Yield Analysis Report 4. PIMCO Performance Monitoring Report -Liquid Operating Monies 5. PIMCO Performance Monitoring Report-Long-Term Operating Monies 6. Mellon Trust Asset Summary by Asset Type with Sectors -Liquid Operating Monies 7. Mellon Trust Asset Summary by Asset Type with Sectors -L-T Operating Monies 8. Mellon Trust Yield Analysis Report 9. Mellon Trust Asset Detail -Consolidated 10. Mellon Trust Transaction Detail -Consolidated MW:bg H:ldepllfin\210\CRANE\FAHRIFAHR2005\JUNE\TREASRPT060805.doc Page 3 Orange County Sanitation District Investment Transactions and Balances in the State of California Local Agency Investment Fund May 31, 2005 Par Value Book Value Market Value Balance May 1, 2005 $31,232,936 $31,232,936 $31,232,936 Deposits: 5/20/2005 9,800,000 9,800,000 9,800,000 Total Deposits 9,800,000 9,800,000 9,800,000 Withdrawals: 5/6/2005 (2,400,000) (2,400,000) (2,400,000) 5/9/2005 (5,900,000) (5,900,000) (5,900,000) 5/11/2005 (2,500,000) (2,500,000) (2,500,000) 5/25/2005 (4,200,000) (4,200,000) (4,200,000) Total Withdrawels (15,000,000) (15,000,000) (15,000,000) Balance May 31, 2005 $26,032,936 $26,032,936 $26,032,936 Rate Yield 2.86 2.86 2.86 2.86 2.86 2.86 2.86 2.86 2.86 2.86 2.86 2.86 2.86 2.86 2.86 2.86 2.86 2.86 PIM C 0 June 6, 2005 Mr. Mike White, CPA Controller Orange County Sanitation District 10844 Ellis A venue Fountain Valley, CA 92708-7018 Dear Mike: The following is a description of events in the bond markets during the month of May in addition to an analysis of the strategies undertaken in the Orange County Sanitation District's Long-Term and Liquid portfolios over the period. Also included is a section on our outlook and preferred strategies to be pursued in your portfolios during the coming months. Bo11d Market Recap: Treasury yields rose in the first week of the month on news of an eighth consecutive rate hike by the Fed, stronger-than-expected job numbers and the prospective re-issuance of 30-year Treasury bonds. Treasury yields subsequently declined over the remainder of the month with the benchmark 10-year Treasury yield ending May at a near 14-month low of 3.98 percent. Contributing factors included weakening consumer confidence, mild signs of inflation, and flight- to-quality pressures. U.S. economic data was overall positive during the month. Non-farm payrolls rose 274,000 in April, exceeding the 174,000 jobs forecasted by analysts. March payrolls were revised upward from 110,000 to 146,000. The unemployment rate remained unchanged at 5.2 percent. GDP growth for the first quarter was revised upward to 3 .5 percent annualized, faster than the government's previous estimate of 3.1 percent. Prior quarter's annual GDP growth rate was 3.8 percent. Inflation numbers (ex-food and energy prices) were mild, as Core CPI remained unchanged and Core PPI rose 0.3 percent over the month. Core PCE, on a year-over-year basis, rose 1.6%. U.S. bond sectors continued to gain ground in May. Treasuries returned 1.22 percent for the month, as measured by the Lehman U.S. Treasury Index. TIPS underperformed their nominal counterparts on both an absolute and duration-adjusted basis. Beyond the Treasury sector, the credit-sensitive sectors within the bond market performed well. Mortgage-backed securities returned 0.79 percent, outperforming Treasuries by 10 basis points after adjusting for duration. The credit sector, represented by the Lehman Credit Index, returned 1 .40 percent, outperforming Mr. Mike White, CPA Orange County Sanitation District June 6, 2005 Page2 Treasuries for the month by 15 basis points. Within the sector, the BAA-rated investment grade corporates outperformed higher quality issues. Treasury yield changes during the month of May are summarized as follows: • 3-month bills: +5 basis points to 2.94% • 6-month bills: -6 basis points to 3 .11 % • 2-year notes: -8 basis points to 3.57% • 5-year notes: -16 basis points to 3.74% • 10-year notes: -22 basis points to 3.98% • 30-year notes: -19 basis points to 4.32% Performance Attrih11tio11: Long-Term Portfolio The Long-Term portfolio that PIMCO manages on behalf of Orange County Sanitation District returned 0.55% on a total return basis for the month of May, performing in line with the Merrill Lynch 1-5 year Government Corporate Index. The following points summarize returns for the month ended May 31: • The Long-Term portfolio lagged the benchmark by 2 basis points for the month. • For the twelve-month period, the Long-Term portfolio returned 3.16%, outperforming the benchmark by 46 basis points. • Portfolio duration, near the benchmark, was neutral for monthly performance as the yield curve continued to flatten. • Yield curve positioning similar to that of the index was neutral for performance. • An underweight exposure to corporates was negative for performance, as corporates outperformed Treasuries on a duration-adjusted basis. • Exposure to mortgage-backed securities was positive for performance as the sector outperformed Treasuries on a duration-adjusted basis. • Substituting Treasury Inflation Protected Securities for nominal Treasuries was negative for performance as TIPS underperformed their nominal counterparts during the month. Liquid Portfolio The Liquid portfolio that PIMCO manages on behalf of Orange County Sanitation District generated a total return of 0.26% during the month of May, performing in line with the 3-month Treasury Bill Index. The following points summarize returns for the period ending May 31: • The Liquid portfolio outperformed the benchmark by 2 basis points for the month. • For the twelve-month period, the Liquid portfolio returned 1.99%, outperforming the benchmark by 11 basis points. • Use of higher yielding securities such as commercial paper and short-term notes Mr. Mike White, CPA Orange County Sanitation District contributed to performance. Outlook and Strategv: June 6, 2005 Page3 The global economy will be stable through the balance of 2005, led by modestly above-trend U.S. growth. In the U.S., the handoff from stimulative fiscal and monetary policy to a revived corporate sector has occurred. Another critical element of cyclical stability will be continued funding of the U.S. trade deficit by Asian central banks, though trade and financial imbalances threaten to erode this mutually beneficial arrangement over the long run. The yield on the benchmark IO-year Treasury will range between 4.00 and 4.75 percent with the risk of a slight breakout on the high side. Important aspects of our outlook include: • U.S. Housing Risk Mitigated -The ability to monetize housing wealth via mortgage refinancing has helped sustain U.S. consumption. While rich valuations and the potential for higher mortgage rates will temper future housing price gains, a crash is unlikely. Affordability should hold up so long as incomes remain stable. Only a small percentage of mortgages are subject to upward rate adjustments in the near term. • U.S. Inflation Pressures Build -While inflation is well contained in much of the world, the recent trend upward in U.S. inflation will be sustained. Inflation pressure is emerging in producer prices and durable goods, suggesting that Corporate America is regaining pricing power. A weak dollar, higher commodity prices and rising unit labor costs will add to the pressure. • Europe and Japan To Grow More Slowly Than U.S. -In Europe and Japan, the corporate sector is showing signs of strength. Companies have de-levered balance sheets and boosted profits via cost cutting and layoffs. While such restructuring bodes well over a secular time frame, real wages and consumption have not yet recovered in either of these economies. Their contribution to global growth will therefore be modest. • Emerging Markets Supply Savings -These economies are now an important buffer for the global economy thanks to their stronger financial profiles and trade surpluses. Along with China and slow-growing Europe and Japan, emerging market countries will contribute to a global glut of savings outside the U.S. that will help keep real interest rates low. • Potential Shocks To Stability -Some catalysts that could disrupt global economic stability include: 1) a pullback of U.S. consumption in response to a Fed policy mistake; 2) upside inflation surprises; 3) unexpected currency revaluations or reduction of U.S. dollar reserves by Asian central banks; 4) oil/commodity price shocks; 5) collapse of a leveraged investor or institution; 6) geopolitical turmoil; and 7) trade protectionism. To the extent that guidelines allow, PIMCO will employ a diverse range of strategies to enhance portfolio yield while still protecting investors' capital if macroeconomic stability unravels. Key strategies will include: • Duration and Yield Curve -We will look to add value and control risk via tactical flexibility. The duration target will be about neutral to the index when rates are near the top of our forecast range, but we will shorten it to about 0.50 year below the index when rates approach the bottom of our range. We will maintain an overall curve position close to that of the benchmark. Mr. Mike White, CPA Orange County Sanitation District June 6, 2005 Page4 • Selectively Trim Underweight Of Core U.S. Sectors -Rich valuations in core bond sectors such as mortgages and corporates dictate caution in employing these bonds to enhance yield. In the mortgage sector, PIMCO will add value via coupon and security selection, and cautiously look for opportunities to add exposure to boost income. Similar opportunities may also be available in the corporate market, though any reduction in our corporate underweight will likely be smaller. • TIPS as an Out-of-Index Alternative -Better risk/reward trade-offs can be found outside of core sectors. Real return bonds should benefit from relatively low and stable real yields, as well as larger inflation adjustments over the next several months. They are also less volatile than nominal bonds in a rising rate environment. We look forward to discussing these and other topics with you in the near future. Best regards, Christine Telish, CF A Vice President John M. Miller, CF A Senior Vice President Mr. Mike White, CPA Orange County Sanitation District Orange County Sanitation District for the month ending May 31, 2005 Total Return Account -203 Market Value Book Value Yield to Maturity Short Term Account -603 Market Value Book Value Yield to Maturity With Accrued Interest 341,609,000 341,985,251 4.04 With Accrued Interest 73,893,774 73,936,496 3.14 June 6, 2005 Page8 Without Accrued Interest 338,447,468 338,823,719 4.08 Without Accrued Interest 73,677,106 73,719,827 3.15 MONTHLY REPORT ORANGE COUNTY SANITATION DISTRICT INVESTMENT MANAGEMENT PROGRAM PIMCO'S PERFORMANCE MONITORING & REPORTING (for the month ended 31 May 2005) Liquid Operating Monies (603) 15.1.1 PORTFOLIO COST AND MARKET VALUE Current Market Value Estimate: • PIMCO • Mellon Historical Cost: • PIMCO • Mellon 15.1.2 MODIFIED DURATION Of Portfolio: Oflndex: 15.1.3 1 ¾ INTEREST RATE CHANGE Dollar Imnact (gain/loss) of 1 % Change: 15.1.4 REVERSE REPOS % of Portfolio in Reverse Repos: ( see attached schedule) 15.1.5 PORTFOLIO MATURITY % of Portfolio Maturing within 90 days: 15.1.6 PORTFOLIO QUALITY Average Portfolio Credit Oualitv: 15.1.7 SECURITIES BELOW "A" RATING % of Portfolio Below "A": 15.1.8 INVESTMENT POLICY COMPLIANCE "In Comnliance" 15.1.9 PORTFOLIO PERFORMANCE Total Rate of Return(%) by Period: 1 Month: 3 Months: 12 Months: Fiscal Year-to-Date: Commentary • The Liquid portfolio outperformed the benchm11rk by 2 basis points for the month, and by l O basis points fiscal year-to-date. • PIMCO's emphasis on higher yielding securities such as commercial paper and short-term notes contributed to performance. H:ldept\fln\220\geggle\FAHR\LIQ0S00-05-05.RPT.doc Page 1 of 1 $73,893,774 $73,883,961 $73,936,496 $73,992,981 0.12 0.20 $88,673 0% 87% ''AAA'' 0% Yes Portfolio Index 0.26 0.24 0.71 0.67 1.99 1.88 1.90 1.80 MONTHLY REPORT ORANGE COUNTY SANITATION DISTRICT INVESTMENT MANAGEMENT PROGRAM PIMCO'S PERFORMANCE MONITORING & REPORTING (for the month ended 31 May 2005) Long-Term Operating Monies (203) 15.1.1 PORTFOLIO COST AND MARKET VALUE Current Market Value Estimate: • PIMCO • Mellon Historical Cost: • PIMCO • Mellon 15.1.2 MODIFIED DURATION Of Portfolio: Oflndex: 15.1.3 1 o/o INTEREST RATE CHANGE Dollar lmnact (gain/loss) of 1 % Change: 15.1.4 REVERSE REPOS % of Portfolio in Reverse Repos: ( see attached schedule) 15.1.5 PORTFOLIO MATURITY % of Portfolio Maturinl!: within 90 davs: 15.1.6 PORTFOLIO QUALITY A vera11:e Portfolio Credit Oualitv: 15.1.7 SECURITIES BELOW "A" RATING % of Portfolio Below "A": 15.1.8 INVESTMENT POLICY COMPLIANCE "In Comnliance" 15.1.9 PORTFOLIO PERFORMANCE Total Rate of Return(%) by Period: 1 Month: 3 Months: 12 Months: Fiscal Year-to-Date: • The Long-Term portfolio lagged the benchmark by 2 basis points for the month, and outperformed the benchmark by 42 basis points fiscal year-to-date. • Portfolio duration, near the index, was neutral for monthly performance as the yield curve continued to flatten. • Yield curve positioning similar to that of the index was neutral for performance. • An underweight exposure to corporates was negative for performance, as corporates outperformed Treasuries on a duration-adjusted basis. • Exposure to mortgage-backed securities was positive for performance as the sector outperformed Treasuries on a duration-adjusted basis. • Substituting Treasury Inflation Protected Securities for nominal Treasuries was negative for performance as TIPS underperformed their nominal counterparts during the month. Page 1 of2 $341,609,000 $341,623,940 $341,985,251 $343,522,929 2.29 2.42 $7,822,846 0% 5% AAA 0% No* Portfolio Index 0.55 0.57 1.35 1.16 3.16 2.70 3.01 2.59 *Compliance Issues: MONTHLY REPORT ORANGE COUNTY SANITATION DISTRICT INVESTMENT MANAGEMENT PROGRAM PIMCO'S PERFORMANCE MONITORING & REPORTING (for the month ended 31May 2005) Page 2 of2 $1,600,000 par of United Airlines (UAL) Pass-Through 2001-1-C (Enhanced Equipment Trust Certificate (EETC) -9093 l 7BC2), 6.831 % coupon, 3/01/2010 maturity, representing 0.47% of the portfolio holdings on a par basis was purchased on 8/10/2001; and subsequently downgraded by Moody's fromA3 to BAl (on 9/18/2001) and S&P from A-to BBB (on 9/20/2001). The security was further downgraded by Moody's fromBAl to BA3 (on 12/21/2001) and by S&P from BBB to BB (on 6/28/02). Following news of the possible bankruptcy filing, the security was further downgraded in August (B3 Moody's, B+ by S&P). On November 29, 2002, S&P further downgraded this issue to B, and shortly thereafter on December 9, 2002, downgraded the issue one notch further to B-. On August 7, 2003, S&P downgraded the issue to CCC+, while Moody's followed suit on August 28, 2003 with a downgrade to CA. Both rating agencies have since withdrawn their ratings (Moody's withdrew in February 2004 and S & P withdrew in June 2004). The District's investment policy requires a minimum rating of A3 by Moody's or A-by S&P, with at least a BBB rating in the event ofa split. Last week, UAL dodged two threatened strikes after one key labor group ratified a deal worth $96 million annually to the carrier and the leadership of another union agreed to a separate concessions plan. UAL secured labor savings of $96 million when members of the Aircraft Mechanics Fraternal Association voted to accept a 3.9% wage cut. A bankruptcy judge approved the five-year deal within hours. The air carrier also entered an agreement in principle with the International Association of Machinists and Aerospace Workers, the union representing about 20,000 baggage handlers, customer service workers and related personnel. The deals headed off a bankruptcy court ruling that could have voided existing collective bargaining agreements and allowed the carrier to impose new contracts. Both unions had threatened to strike if their current contracts were terminated involuntarily. PIMCO continues to negotiate with United on our holdings and currently leads an ad hoc committee. This has been an extremely complicated effort due to the complex nature ofUnited's bankruptcy. These negotiations have required PIMCO's analysts access to non-public information and therefore sharing them results in parties becoming restricted. In light of this extremely complicated bankruptcy, PIMCO continues to strive to act in the most prudent manner to obtain maximum recovery. Split Rated Securities Still In Compliance: The District's investment policy requires a minimum rating of A3 by Moody's or A-by S&P, with at least a BBB in the event of a split rating. $1,750,000 par of Virginia Electric Power NT securities (cusip 927804EN0), maturing on March 31, 2006, represents 0.51% of the portfolio holdings on a par basis. The security was downgraded on 10/21/2002 by S&P from A-to BBB+, but continues to carry a Moody's rating of A3. H:\dept\jin \220\geggie\F AHR\L-T0B00-05-05.RPT.doc YLDANAL YIELD ANALYSIS PAGE 1 OCSF07511102 2005/05/31 RUN DATE 06/06/05 DISTRICT: LIQUID OPERATING RUN TIME 10.10.31 -------------~-==:::=--===--===-=-------============================ PAR VALUE YTM AT CURRENT MOODY Ml\RI<ET TOTAL COST/ % TYPE SECURITY ID SECURITY DESCRIPTION BOOK YIELD S-P PRICE MARKET VALUE % TOTAL ------------------------------------------------------------------------------------------------- CASH & CASH EQUIVALENTS 5,ooo,ooo.oo FEDERAL HOME LN BK CONS DISC .000 .coo P-1 99 .918 4,995,888.89 7.44 313385GS9 MAT 6/10/2005 A-1+ 4,995,888.89 6.79 4,000,000.00 FEDERAL HOME LN BK CONS DISC .ooo .ooo P-1 99. 811 3,992,435.56 5.94 313385GX8 MAT 06/15/2005 A-1+ 3,992,435.56 5.42 4,800,000.00 FEDERAL HOME LN BK CONS DISC N .ooo .000 P-1 99 .49 9 4,775,967.33 7 .11 313385JL1 MAT 07/22/2005 A-1+ 4,775,967.33 6.49 2,000,000.00 FEDERAL HOME LN MTG CORP DISC .ooo .coo P-1 99.323 1,986,466.67 2.96 313397GW5 MAT 06/14/2005 A-1+ 1,986,466.67 2.70 4,000,000.00 FEDERAL HOME LN MTG CORP DISC .ooo .ooo P-1 99.148 3,965,933,33 5.91 313397HN4 MAT 06/30/2005 A-1+ 3,965,933.33 5.39 3,000,000.00 FEDERAL HOME LN MTG ASSN DISC .000 .coo P-1 99.236 2,977,080.00 4.43 313397JAO MAT 07/12/2005 A-1+ 2,977,080.00 4.04 1,100,000.00 FEDERAL HOME LN MTG CORP DISC .ooo .ooo P-1 99.397 1,093,369.44 1.62 313397JXO MAT 08/02/2005 A-1+ 1,093,369.44 1.49 2,000,000.00 FEDERAL HOME LN MTG CORP DISC .ooo .ooo P-1 9~.245 1,984,893.33 2.95 313397KEO MAT 08/09/2005 A-1+ 1,984,893.33 2.70 1,000,000.00 FEDERAL NATL MTG ASSN DISCOUNT .ooo .coo P-1 99,252 992,517.78 1.47 313589HM8 MAT 06/29/2005 A-1+ 992,517.78 1.35 1,000,000.00 FEDERAL NATL MTG ASSN DISC .ooo .ooo P-1 98,846 988,461.67 1.47 313589JW4 08/01/2005 A-1+ 988,461.67 1.34 6,000,000.00 FEDERAL NATL MTG ASSN DISCOUNT .ooo .ooo P-1 99.178 5,950,691.67 8.86 313589KD4 MAT 08/08/2005 A-1+ 5,950,691.67 8,08 2,500,000.00 FEDERAL NATL MTG ASSN DISCOUNT .ooo .000 P-1 99.221 2,480,536.11 3.69 313589KF9 MAT 08/10/2005 A-1+ 2,480,536.11 3.37 4,000,000.00 FEDERAL NATL MTG ASSN DISCOUNT .ooo .coo P-1 98 .367 3,934,682 .22 5.86 313589NL3 MAT 10/26/2005 A-1+ 3,934,682.22 5.35 2,000,000.00 GENERAL ELEC CAP DISC .000 .coo P-1 99 .240 1,984,800.00 2.95 36959HUB1 07/11/2005 1,984,800.00 2.70 YLDANAL OCSF07511102 DISTRICT: LIQUID OPERATING YIELD ANALYSIS 2005/05/31 =================================================================================== PAR VALUE SECURITY ID SECURITY DESCRIPTION 1,000,000.00 GENERAL ELEC CAP DISC 36959HUR6 07/25/2005 1,000,000.00 US TREASURY BILL 912795VH1 DUE 07/21/2005 DD 01/20/2005 2,000,000.00 US TREASURY BILL 912795VK4 0,000% OB/04/2005 DD 02/03/05 2,000,000.00 US TREASURY BILL 912795VVO 10/13/2005 DD 04/14/2005 13,000,000,00 CS FOB CAT 2 REPO REPO 99436A319 02.940% 06/01/2005 DD 05/31/05 128,846,46 DREYFUS TREASURY CASH MGMT 996085247 .oo BSDT-LATE MONEY DEPOSIT ACCT 996087094 TOTAL CASH & CASH EQUIVALENTS FIXED INCOME SECURITIES 3,000,000.00 046003FF1 3,500,000,00 06050VLQ8 ASSOCIATES CORP NORTH AMER SR 6.625% 06/15/2005 DD 06/09/95 BANK AMER NA TRANCHE tTR00255 VAR RT 08/08/2005 DD 02/07/05 TOTAL FIXED INCOME SECURITIES TOTAL Y'rM AT BOOK .ooo ,000 .ooo .000 .ooo .ooo .000 -·-------,000 .000 .ooo -------- ,000 .ooo CURRENT MOODY MARKET YIELD S-P PRICE .000 P-1 99,227 ,000 P-1 98,900 A-1+ .000 P-1 99 .118 A-1+ .ooo P-1 98,516 A-1+ 2.940 100.000 2.751 AAA 100,000 AAA .000 ,000 ------- .155 6,618 AAl 100.109 AA- 3.050 MIGl 100.000 ------ 5,304 .221 PAGE RUN DATE RUN TIME TO'.I'AL COST/ MARKET VALUE 992,275.00 992,275.00 6,923,014,00 6,!123,014.00 1,982,359.44 1,982,359.44 1,970,327.92 1,970,327.92 13,000,000,00 13,000,000,00 12B,B46.46 128,846.46 .oo .oo -----------------67,100,546.82 67,J00,546,82 3,112,350.00 3,003,270.00 3,499,940.20 3,500,000,00 ---·--------------- 6,612,290.20 6,503,270,00 ---------------73,712,837,02 73,603,816,82 2 06/06/05 10,10,31 % TYPE % TOTAL 1.47 1.35 10,31 9 ,41 2,95 2,69 2,93 2,6B 19,37 17,66 ,19 ,18 .oo ,00 ---------100.00 91.18 46.18 4.08 53.81 4,76 ---------100.00 8,84 -·------ 100.00 100.00 ~~~-=·- YLDANAL OCSF07522202 DISTRICT: LONG-TERM OPERATING YIELD ANALYSIS 2005/05/31 PAGE RUN DATE RUN TIME 3 06/06/05 10,10,31 ---------------------------------------------------------------------------------- PAR VALUE SECURITY ID SECURITY DESCRIPTION CASH & CASH EQUIVALENTS 6,200,000.00 FEDERAL HOME LN BK CONS DISC N 313385GZ3 MAT 06/17/2005 500,000.00 FEDERAL HOME LN MTG CORP DISC 313397KU4 MAT 08/23/2005 l0,000,000.00 UBS AG STAMFORD BRR INSTL C/D 90261GE47 VAR RT 07/05/2005 DD 07/02/04 1,355,257.97 DREYFUS TREASURY CASH MGMT 996085247 .00 BSDT-LATE MONEY DEPOSIT ACCT 996087094 TOTAL CASH & CASH EQUIVALENTS FIXED INCOME SECURITIES 752,000,00 AIG SUNAMERICA GLOBAL REGS U00907AAO 5.850% 08/01/2008 DD 08/08/01 3,000,000.00 CIT GROUP INC SR NT 125581AA6 7.375% 04/02/2007 DD 04/01/02 1,500,000.00 CIT GROUP INC NEW SR NT 125581AF5 VAR RT 09/22/2006 DD 09/23/03 3,3001000,00 CIT GROUP INC MTN fSR00092 12560PDVO VAR RT 05/23/2008 DD 05/25/05 1,600,000.00 CITIGROUP INC GLOBAL SR NT 172967CW9 VAR RT 05/02/2008 DD 05/02/05 l0,000 1 000.00 FEDERAL HOME LN MTG CORP MTN 3128X3WY5 4.000% 09/22/2009 DD 09/22/04 50,890,02 FHLMC GROUP 178-6064 31348SWZ3 6.384% 01/01/2028 DD 12/01/97 YTM AT CURRENT MOODY MARKET BOOK YIELD S-P PRICE ,000 .ooo .ooo .000 .ooo 3,031 .ooo 2,751 ,000 .ooo .000 1.499 .000 5.325 ,000 6,980 .000 3.436 .ooo 3,506 .000 3,262 .000 4.035 ,000 4.155 P-1 A-1+ P-1 A-1+ AAA AAA A2 A A2 A A2 AAl AA- AAA AAA AAA AAA 99. 79'1 !19. 203 ~9.955 100.000 .ooo 109.567 105.655 100.,121 99,937 99.937 ~19, 14Cl 103.395 TOTAL COST/ MAPKET VALUE 6,187,255.55 6,187,255.55 496,013.33 496,013.33 9,995,500.00 9,995,500.00 1,355,257.97 1,355,257.97 .oo .oo 18,034,026,85 18,034,026.85 ll26,199,84 e26,199.84 3,169,560.00 3,169,655.91 1,507,005.00 1,506,315.00 3,300,000.00 3,297,921.00 1,600,000.00 1,~·,90,992.00 9,993,100.00 9,~14,000.00 49,649.57 52,617.74 % TYPE % TOTAL 34.30 1.53 2,75 .12 55,42 2,48 7,51 ,34 .oo .oo 100.00 4,47 .21 .20 .82 .79 ,39 .37 .85 .82 .41 .40 2,57 2,46 .01 ,01 YLDANAL YIELD ANALYSIS PAGE 4 OCSF07522202 2005/05/31 RUN DATE 06/06/05 DISTRICT: LONG-TERM OPERATING RUN TIME 10,10.31 ==.z......=-=--== ----=:,~-. PAR VALUE YTM AT CURRENT MOODY MARKET TO'l'AL COST/ % TYPE SECURITY ID SECURITY DESCRIPTION BOOK YIELD S-P PRICE MARKET VALUE % TOTAL -------------------------------------------------------------------------------------------------- 2,350,000.00 FEDERAL NATL MTG ASSN DEBS .ooo 5.173 AAA 101. !85 2,385,461.50 .61 31359MJX2 5.250% 06/15/2006 DD 06/22/01 AAA 2,::84,897.50 .59 599,407.15 FNMA POOL t0254510 .000 4.935 AAA 101. ilJ (,17,389.36 .15 31371KVB4 5.000% 11/01/2017 DD 10/01/02 AAA 607,277.37 .15 128,951.93 FNMA POOL t0254631 .ooo 4.935 AAA 101.~07 132,820.49 .03 31371KY47 5.000% 02/01/2018 DD 01/01/03 AAA 130,637.33 .03 115,683.47 FNMA POOL t0254760 .ooo 4.936 AAA 101.294 119,153.96 .03 31371K5V9 5.000% 06/01/2018 DD 05/01/03 AAA 117,180.41 .03 52,903.39 FNMA POOL t0254866 .ooo 4 .937 AAA 101. 284 54,490.50 .01 31371LCB3 5.000% 09/01/2018 DD 08/01/03 AAA 53,582.67 .01 392,881.34 FNMA POOL 10254907 .ooo 4. 937 AAA 101.281 392,881.34 ,10 31371LDLO 5,000% 10/01/2018 DD 09/01/03 AAA 397,914.15 .10 279,458.04 FNMA POOL t0254953 .ooo 4,937 AAA 101. ,73 ~'83,038.61 .07 31371LE21 5.000% 11/01/2018 DD 10/01/03 AAA ,'83,029,51 .07 755,338.63 FNMA POOL 10254987 .ooo 4.941 AAA 101. :;_93 765,016.40 ,19 31371LF46 5.000% 12/01/2018 DD 11/01/03 AAA ·,64,392,57 ,19 126,370.62 FNMA POOL t0323980 .ooo 5.791 AAA 103,609 131,938.82 .03 31374T2MO 6.000% 04/01/2014 DD 09/01/99 AAA 130,931.34 .03 21,688.78 FNMA POOL t0357328 .000 4.939 AAA 101. 229 22,339.45 .oo 31376J4M8 5.000% Ol/01/2018 DD 01/01/03 AAA 21,955.32 .01 1,146,434.10 FNMA POOL 10357430 .ooo 4.936 AAA 101.291 1,159,331.48 .30 31376KA71 5.000% 09/01/2018 DD 09/01/03 AAA 1,161,234.56 ,29 35,768.66 FNMA POOL 10456482 .ooo 5.791 AAA 103,609 37,344.70 .oo 31381CCT2 6.000% 02/01/2014 DD 02/01/99 AAA 37,059,55 .01 95,550.18 FNMA POOL 10509649 .ooo 5.791 AAA 103,C,OJ 99,760.36 .02 31383QEWO 6.000% 09/01/2014 DD 09/01/99 AAA 98,998.59 .02 97,836.61 FNMA POOL 10535451 .ooo 5.791 AAA 103. ,_,o -~ )02,147.54 .02 31384VZQ8 6.000% 06/01/2015 DD 07/01/00 AAA JOl,367.53 .03 277,179.64 FNMA POOL t0555363 .ooo 4.936 AAA 101. 303 285,495.02 .01 31385W5Yl 5.000% 04/01/2018 DD 03/01/03 AAA 280,791.29 .07 YLDANAL YIELD ANALYSIS PAGE 5 OCSF07522202 2005/05/31 RUN DATE 06/06/05 DISTRICT: LONG-TERM OPERATING RUN TIME 10.10.31 -------------------------------------------==---====---==-~=--·--==-·===::::==-=====-·-----==========--====--==----= PAR VALUE Y:rM AT CURRENT MOODY MARI<ET TO'lAL COST/ % TYPE SECURITY IO SECURITY DESCRIPTION BOOK YIELD S-P PRICE MAP.KET VALUE % TOTAL -·---------------------------------------------------------------------------------------------------- 28,790.83 FNl11\ POOL 10555453 .ooo 4.936 AAA 101. ·300 29,159.72 .oo 31385XBW6 5.000% 05/01/2018 DD 04/01/03 AAA 29,165.11 .01 231,111.03 FNMA POOL 10555545 .ooo 4.936 AAA 101. ~0-) ,38,044.37 .06 31385XES2 5.000% 06/01/2018 DD 05/01/03 AAA 234,115.47 .06 790,841.29 FNM/\ POOL 10555621 .ooo 4 .941 AAA 101. 193 799,738.25 .20 31385XG68 5.000% 07/01/2018 DD 06/01/03 AAA 800,320.79 .20 435,068.62 FNMA POOL 10681309 .ooo 4,935 AAA 101. 307 448,120.68 .11 31391Y3S4 5.000% 02/01/2018 DD 02/01/03 AAA 440,754.97 .11 52,181.36 FNMA POOL 10681334 .ooo 4.935 AAA 101. ~07 53,746.81 .01 31391Y4Tl 5.00 0% 02/01/2018 DD 01/01/03 AAA 52,863.37 .01 333,981.19 FNMA POOL 10684798 .ooo 5,413 AAA 101.601 333,694.18 .08 31400DX31 5.500% 03/01/2033 DD 03/01/03 AAA 339,328.23 .08 284,959.41 FllMA POOL 10684908 ,000 4.936 AAA 101. ,:94 ,BB,610.47 .07 31400D3Rl 5.000% 06/01/2018 DD 05/01/03 AAA ;'88,646.78 .07 155,888.91 FllMA POOL 10685200 ,000 4.936 AAA 101. 100 )57,886.26 .04 31400EGH7 5.000% 03/01/2018 DD 03/01/03 AAA 157,915.47 .04 26,313.67 FNMA POOL 10685665 .ooo 4.935 AAA 101. 307 27,103.08 .oo 31400EW22 5.000% 02/01/2018 DD 02/01/03 AAA 26,657.59 .01 236,120.92 FNMA POOL 10686318 .ooo 4 .936 AAA 101. 303 243,204.54 .06 31400FPB7 5,000% 03/01/2018 DD 03/01/03 AAA 239,197.58 .06 90,741.07 FNMA POOL 10688739 .ooo 4.936 AAA 101. 294 93,463.30 .02 31400JEL9 5.000% 06/01/2018 DD 06/01/03 AAA 91,915.26 .02 81,450.20 FNMA POOL 10689859 .ooo 4.936 AAA 101. 29·1 82,493.78 .02 31400KMGB 5.000% 05/01/2018 DD 05/01/03 AAA 82,504.17 .02 489,209.84 FNMA POOL 10693834 .000 4,936 AAA 101. '03 ~03,886.12 .12 31400PY74 5.000% 03/01/2018 DD 03/01/03 AAA t.95,584.24 .12 182,816.08 FNMA POOL 10695852 .ooo 4.936 AAA 101.297 JBB,300.56 .04 31400SBVO 5.000% 05/01/2018 DD 05/01/03 AAA J85,l87.20 ,05 635,468.81 FNMA POOL f0695889 .ooo 4.936 AAA 101. 297 654,532.89 .16 31400SC23 5,000% 05/01/2018 DD 05/01/03 AAA 643,710.84 .16 YLDANAL YIELD ANALYSIS PAGE 6 OCSF07522202 2005/05/31 RUN DATE 06/06/05 DISTRICT: LONG-TERM OPERATING RUN TIME 10.10.31 ==---==-====-================================================================================================================ PAR VALUE Yrl1 AT CURRENT MOODY MARI<ET TO~AL COST/ % TYPE SECURITY ID SECURITY DESCRIPTION BOOK YIELD S-P PRICE MAf'KET VALUE % TOTAL ---~--------------·---------------------------------------------------------------------------·-------- 19,276.87 FNMA POOL 10697026 .ooo 4.936 AAA 101.:.'97 19,855.19 .oo 31400TLF2 5.000% 05/01/2018 DD 04/01/03 AAA 19,526.89 .oo 195,793.37 FNMA POOL 10702210 .ooo 4.941 AAA 101. '9) :01,667.17 ,05 31401ADP9 5,000% 05/01/2018 DD 05/01/03 AAA )98,140,27 .05 110,618,66 FNMA POOL 10702328 .ooo 4,936 AAA 101.297 112,035.96 .02 31401AHD2 5,000% 05/01/2018 DD 04/01/03 AAA 112,053.38 ,03 241,073.17 FNMA POOL 10709148 .000 4.936 AAA 101. 291 248,305.38 .06 31401HZM7 5,000% 06/01/2018 DD 06/01/03 AAA 244,185.42 .06 531,620.32 FNMA POOL 10709360 .000 4,936 AAA 101. 291 538,431.71 .13 31401JB56 5,000% 07/01/2018 DD 06/01/03 AAA 538,483.54 .13 93,107.35 FNMA POOL 10709826 .ooo 4.936 AAA 101.,H 94,300.:28 ,02 31401JSP4 5,000% 06/01/2018 DD 06/01/03 AAA 94,312,)6 .02 192,386.19 FNMA POOL 10709917 .000 4 .936 AAA 101.,91 :94,851.14 .OS 31401JVJ4 5,000% 06/01/2018 DD 06/01/03 AAA )94,875,67 .os 17,577.58 FNMA POOL 10709963 .000 4,941 AAA 101,JH 17,802,BO .oo 31401JWYO 5,000% 06/01/2018 DD 06/01/03 AAA 17,788,28 .oo 484,095.46 FNMA POOL 10710235 .ooo 4,936 AAA 101. 291 498,618.35 .12 31401KBC8 5,000% 06/01/2018 DD 06/01/03 AAA 490,345.13 .12 13,031.28 FNMA POOL 10713344 .ooo 4,936 AAA 101. 294 13,422.21 .oo 31401NP52 5.000% 06/01/2018 DD 06/01/03 AAA 13,199.90 .oo 211,983.80 FNMA POOL 10713365 .ooo 4.936 AAA 101. 291 214,699.83 .os 31401NQS1 5,000% 07/01/2018 DD 07/01/03 AAA 214,720,51 ,05 603,209,51 FNMA POOL 10720319 .ooo 4,936 AAA 101.291 (;10,938,14 ,15 31401WG45 5,000% 07/01/2018 DD 07/01/03 AAA C 10,996.94 .15 1,904,678,24 FNMA POOL 10720369 .ooo 4,941 AAA 101..199 l,~61,818,59 .so 31401WJNO 5,000% 06/01/2018 DD 06/01/03 AAA l,!27,508,86 .48 258,250.12 FNMA POOL 10721629 .coo 4.936 AAA 101. ;:.91 ::65,997,64 .06 31401XVW4 5,000% 07/01/2018 DD 06/01/03 AAA 261,584.13 .06 186,281.81 FNMA POOL 10723487 .coo 4,936 AAA 101. 291 188,377.49 .04 31402AXQ4 5.000% 06/01/2018 DD 06/01/03 AAA 188,686,71 ,05 YLDANAL YIELD ANALYSIS PAGE 7 1 OCSF07522202 2005/05/31 RUN DATE 06/06/05 DISTRICT: LONG-TERM OPERATING RUN TIME 10.10.31 -------------------------------------------==---===-------=---------=========-=====~-=-===---==========================--==== PAR VALUE YTM AT CURRENT MOODY MARKET TO~AL COST/ % TYPE SECURITY ID SECURITY DESCRIPTION BOOK YIELD 5-P l'RI'.:E MA!'KET VALUE % TOTAL --------------------------------------------------------------·------------· ------------------------ 2,938,834.43 FNMA POOL 10725530 .ooo 4,942 AAA 101. !.73 2,~78,784.19 • 77 31402DA75 5.000% 06/01/2019 DD 05/01/04 AAA 2,~73,320.21 .74 347,903.86 FNMA POOL 10729601 ,000 4.936 AAA 101. ,,88 ::52,361.38 .09 31402HRW3 5.000% 07/01/2018 DD 07/01/03 AAA 352,384.86 .09 31,158.40 FNMA POOL 10732873 .ooo 4,937 AAA 101.278 31,557.60 .oo 31402MFN5 5.000% 11/01/2018 DD 10/01/03 AAA 31,556.60 .01 1,000,000.11 FNMA POOL 10735227 .ooo 5.419 AAA 101. •195 1,008,438.22 .26 31402QYY1 5.500% 02/01/2035 DD 01/01/05 AAA 1,014,950.72 .25 566,288.46 FMM/\ POOL 10737130 .000 4.937 AAA 101.,84 !:-73,544.03 .14 31402S4P9 5.000% 10/01/2018 DD 10/01/03 AAA 573,559.60 .14 450,196.11 FNMA POOL 10738211 ,000 4,941 AAA 101.; 9) •iSS,964,27 .11 31402UDQ2 5.000% 10/01/2018 DD 10/01/03 AAA 1,55,592.43 .11 160,577.14 FNMA POOL 10738487 .ooo 4,937 AAA 101., 73 ]62,634.54 .04 31402UNC2 5.000% 10/01/2018 DD 10/01/03 AAA ]62,629.32 .04 1,932,682.60 FNMA POOL 10740457 .ooo 4,941 AAA 101. 199 1,~5B,955.00 .so 31402WTN8 5.000% 10/01/2018 DD 10/01/03 AAA l,!155,848.89 .48 649,108.76 FNMA POOL 10740471 .ooo 4,941 AAA 101. 199 657,425.45 .17 31402WT40 5.000% 10/01/2018 DD 10/01/03 AAA 656,889.37 .16 671,014.71 FNMA POOL 10740748 .000 4.937 AAA 101.284 679,612.08 .17 31402W5H7 5.000% 10/01/2018 DD 11/01/03 AAA 679,630.54 .17 32,357.89 FNMA POOL 10743868 .000 4.941 AAA 101.] 99 32,772.48 .00 31403BMR1 5.000% 11/01/2018 DD 10/01/03 AAA 32,745.75 .01 876,457.73 FNMA POOL 10744008 .ooo 4.936 AAA 101. ;,91 (87,687.35 .23 31403BR54 5.000% 07/01/2018 DD 09/01/03 AAA (87,799.09 .22 137,192.32 FNMA POOL 10744316 .000 4.941 AAA 101. !9'} ]38,950.10 .03 31403B3Z4 5.000% 09/01/2018 DD 09/01/03 AAA 138,836.79 .03 286,940.40 FNMA POOL 10747914 .ooo 4.937 AAA 101. ,7B 290,616.84 .07 31403F3XO 5.000% 11/01/2018 DD 11/01/03 AAA 290,607.50 .07 168,969.76 FNMA POOL 10748400 .000 4,941 AAA 101. J 99 )71,134.69 .04 31403GNR9 5.000% 08/01/2018 DD 09/01/03 AAA 170,995.13 .04 YLDANAL YIELD ANALYSIS PAGE 8 OCSF07522202 2005/05/31 RUN DATE 06/06/05 DISTRICT: LONG-TERM OPERATING RUN TIME 10.10.31 --------------------=---==---==----=----=-====~=======================-== PAR VALUE YTM AT CURRENT MOODY MARI<ET TO'l'AL COST/ % TYPE SECURITY ID SECURITY DESCRIPTION BOOK YIELD S-P PRICE MAPKET VALUE % TOTAL ---------------------------------------------------------------------·--------·-----------·------- 844,489.66 FNMA POOL 10748899 .ooo 4.941 AAA 101. 193 1-55,309,f8 .22 31403G7LO 5.000% 12/01/2018 DD 11/01/03 AAA l54,612.22 .21 1,867,480.77 FNMA POOL 10750377 .ooo 4,941 AAA 101.;99 l,f91,407.06 .49 31403JUA2 5.000% 11/01/2018 DD 11/01/03 AAA l,U89,865.51 .47 1,555,399,76 FNMA POOL 10750380 .ooo 4 .941 AAA 101. j 99 1,~75,328.33 ,40 31403JUD6 5.000% 11/01/2018 DD 11/01/03 AAA 1,574,043.71 .39 162,422.56 FNMA POOL 10750445 .ooo 4.941 AAA 101. 199 164,503.60 .04 31403JWE2 5.000% 11/01/2018 DD 11/01/03 AAA ]64,369.45 .04 690,752.34 FNMA POOL t0751960 ,000 4.941 AAA 101.199 f99,602.62 .18 31403LMH1 5.000% 12/01/2018 DD 11/01/03 AAA (99,032.11 .17 743,529.72 FNMA POOL 10753425 .ooo 4. 937 AAA 101. :275 ·, 52,126. 77 .19 31403NA23 5.000% 11/01/2018 DD 11/01/03 AAA '.53,009.72 .19 539,727.56 FNMA POOL 10755165 .ooo 4 .937 AAA 101.::75 ~ 46,642.82 .14 31403Q6A3 5.000% 12/01/2018 DD 11/01/03 AAA !46,609.09 .14 851,706.87 FNMA POOL 10756372 .ooo 4.937 AAA 101.ns H61,554.73 .22 31403SJR8 5.000% 11/01/2018 DD 11/01/03 AAA 862,566.13 .21 3,083,957.82 FNMA POOL 10784251 ,000 4.938 AAA 101.250 3,125,880.38 .81 31405BH46 5.000% 11/01/2019 DD 11/01/04 AAA 3,122,507.29 .77 866,296.46 FNMA POOL 10789670 .000 4,938 AAA 101. 250 878,072,68 .22 31405HJP4 5,000% 12/01/2019 DD 12/01/04 AAA 877,125,17 ,22 852,726.08 FNMA POOL 10792432 .ooo 4,938 AAA 101. 250 F64,317,83 .22 31405LLM9 5,000% 10/01/2019 DD 10/01/04 AAA I· 6 3, 385. l 6 .21 4,940,802.52 FNMA POOL 10792437 .000 4,938 AAA 101. ::s ,J 4,!'40,802,52 1.29 31405LLS6 5,000% 10/01/2019 DD 10/01/04 AAA 5,(02,562.55 1. 24 891,049.37 FNMA POOL 10794195 .000 4.938 AAA 101. SJ !03,162.08 ,23 31405NKG9 5,000% 11/01/2019 DD 11/01/04 AAA ~02,187,49 ,22 3,121,687.98 FNMA POOL 10797160 .000 4.938 AAA 101. 250 3,164,123.41 ,82 31405RTR7 5,000% 12/01/2019 DD 12/01/04 AAA 3,160,709,08 ,78 797,630.31 FNMA POOL 10797408 ,000 4.938 AAA 101. 250 808,473,10 .20 31405R3R5 5,000% 12/01/2019 DD 12/01/04 AAA 807,600.69 .20 YLDANAL YIELD ANALYSIS PAGE 9 OCSF07522202 2005/05/31 RUN DATE 06/06/05 DISTRICT: LONG-TERM OPERATING RUN TIME 10.10.31 --=---==:_____, __ -==== PAR VALUE YTM AT CURRENT MOODY MARI<ET TO~AL COST/ % TYPE SECURITY ID SECURITY DESCRIPTION B•JOK YIELD S-P l'Rlt'.'E MAI KET VALUE % TOTAL -----------· ❖---------------------------------------------------------------------------~---- 791,966.89 FNMA POOL #0797414 .ooo 4.938 AAA 101.: 5,J f:02,732.68 .20 31405R3X2 5.000% 12/01/2019 DD 12/01/04 AAA t:01,866.48 .20 367,259.61 FNH/\ POOL f0800370 .ooo 4.938 AAA 101. 750 '.'-66,857.92 .09 31405VFK8 5.000% 12/01/2019 DD 11/01/04 AAA 371,850.36 .09 332,280.07 FNM/\ POOL #0800998 .ooo 5.419 AAA 101. 495 331,994.52 .08 31405V3F2 5.500% 11/01/2034 DD 11/01/04 AAA 337,247.66 ,08 3,043,034,02 FNMA POOL #0803923 .ooo 4,938 AAA 101. 250 3,084,400,27 .79 31406AD41 S.000% 12/01/2019 DD 12/01/04 AAA 3,C81,071.95 .76 2,988,999.9S FNMA POOL #0807711 .ooo 4,938 AAA 101. :'SJ 3,(29,631.66 .78 31406EKY9 5.000% 01/01/2020 DD 01/01/05 AAA 3,( 26,362.45 , 75 332,674.92 FNMA POOL #0808933 .ooo 5.419 AAA 101. ;95 : 32,389, 03 .08 31406FV24 S.SOO% 01/01/2035 DD 01/01/05 AAA :, 37,648.41 ,08 332,920,21 FNMA POOL f0809350 .000 5,419 AAA 10.l,.;95 '.32,634.11 .08 31406GEX3 5.500% 12/01/2034 DD 01/01/05 AAA '.'37,897.37 ,08 334,821.88 FNMA POOL #0814930 ,000 5.423 AAA 101.H7 '.:,34,534,14 .08 31406NLK8 S.SOO% 04/01/2035 DD 04/01/05 AAA 339,565.S5 .08 334,699.83 FNH/\ POOL #0815923 .ooo 5.419 AAA 101.495 334,412.20 .08 31406PPG8 S.500% 03/01/2035 DD 03/01/05 AAA 339,703.59 .08 632,640.44 FNMA POOL #0816246 .ooo 4.938 AAA 101,250 631,948.49 ,16 31406PZK8 5.000% 03/01/2020 DD 03/01/05 AAA 640,548.45 ,16 333,440.26 FNMA POOL #0819566 .ooo 5.419 AAA l01.li95 ~33,153.71 .08 31406TQT1 5.500% 04/01/2035 DD 04/01/05 AAA :-38,425.19 ,08 332,404.00 FNMA POOL #0822731 ,000 5. 419 AAA 101. 195 :32,118.34 .08 31406XA85 5.500% 05/01/2035 DD 05/01/05 AAA :-37,373.44 .08 332,479.00 FNMA POOL 10823232 ,000 5.419 AAA lU.l. '9'i : 32,193.27 .08 31406XSV5 5.500% 06/01/2035 DD 05/01/05 AAA '.'37,449.56 .08 1,999,800.00 FNMA POOL 10823787 .ooo 4.938 AAA 101..:50 1,997,612.70 .52 31406YF47 5.000% 05/01/2020 DD 05/01/05 AAA 2,024,797.SO .so 8,194.59 GNMA POOL 10421389 .ooo 6.192 AAA 104,969 8,600.48 .oo 36206UC23 6.500% 04/15/2026 DD 04/01/96 AAA 8,601.78 .oo YLDANAL YIELD ANALYSIS PAGE 10 OCSF07522202 2005/05/31 RUN DATE 06/06/05 DISTRICT: LONG-TERM OPEilATING RUN TIME 10.10.31 --------------. PAR VALUE YrH AT CURRENT MOODY MARICT TO'.iAL COST/ % TYPE SECURITY ID SECURITY DESCRIPTION BOOK YIELD S-P PRI ::E MAI KET VALVE % TOTAL --~---------------------------------------------------------------------~ ----~ ----------~-------- 12,006,88 GN MJ\ POOL t0449851 .000 6.204 AAA 10-i.n5 12,601.60 .oo 36208FWLO 6.500% 01/15/2028 DD 01/01/98 AAA 12,580.22 .oo 32,475.83 GIH1J\ POOL #0466845 .000 6,195 AAA 10,i._,30 34,084.40 .oo 36209BTA6 6.500% 06/15/2028 DD 06/01/98 AAA 34,076.89 .01 109,789.32 GNM.'\ POOL #0468052 .ooo 6.195 AAA 104.927 115,227.31 .02 36209C5M4 6.500% 07/15/2028 DD 07/01/98 AAA 115,198.64 .03 121,824.95 GNM/\ POOL #0476041 .000 6.195 AAA 104.930 127,668,75 .03 36209MZE7 6.500% 06/15/2028 DD 06/01/98 AAA 127,830.92 .03 119,691.88 GNl1/\ POOL #0478626 .000 6,196 AAA 104, J lJ n5,433,35 .03 36209QVT9 6.500% 01/15/2029 DD 01/01/99 AAA )25,572,34 .03 28,576,10 GNMJ\ POOL #0480598 ,000 6.195 AAA 104,:,H 29,946,85 .oo 36209S3F6 6.500% 10/15/2028 DD 10/01/98 AAA 29,981.76 ,01 8,323.59 GNM/\ POOL #0512235 .000 6,197 AAA 10•1, ,:85 8,735.86 .oo 36211GBC6 6.500% 11/15/2029 DD 11/01/99 AAA 8,730,20 .oo 77,618.75 GNH.'\ POOL #0514326 .ooo 6,197 AAA 104.896 81,342.02 ,02 36211JLF2 6.500% 07/15/2029 DD 07/01/99 AAA 81,418,96 ,02 154,218.75 GNM/\ II POOL #0080395 .000 3,326 AAA 101.•1 84 152,821,14 ,04 36225CNM4 VAR RT 04/20/2030 DD 04/01/00 AAA 156,507,36 ,04 1,378,585.96 GNMA II POOL f080408X ,000 3.326 AAA 101. 4 83 1,364,584,69 .36 36225CN28 VAR RT 05/20/2030 DD 05/01/00 AAA 1,399,030.39 .35 1,260,635.87 GNMA II POOL #0080965 .000 3.473 AAA 100.782 1,259,847.96 .32 36225DCB8 VAR RT 07/20/2034 DD 07/01/04 AAA 1,;-?0,494.04 .31 6,500,000.00 GENERAL ELEC CO NT .ooo 3,210 AAA 100. ·,15 6,~02,203,50 1.68 369604AZ6 VAR RT 10/24/2005 DD 10/24/03 AAA 6,~00,975,00 1.61 3,500,000 ,00 GOLDMAN SACHS GRP MTN fTR00194 .ooo 3,344 AA3 100. 171 3,~07,850,50 .90 38141EJB6 VAR RT 10/27/2006 DD 10/29/03 A+ 3,~oS,985,00 .87 2,000,000 .00 GOLDMAN SACHS GRP MTN fTR00203 .ooo 3,188 AA3 100.062 2,COl,900,00 .51 38141EJL4 VAR RT 03/30/2007 DD 04/01/04 A+ 2,001,240.00 .so 800,000.00 GOLDMAN SACHS GRP MTN fTR00207 .ooo 3,476 AA3 100.421 800,000.00 .20 38141EJQ3 VAR RT 07/23/2009 DD 07/23/04 A+ 803,368.00 .20 YLDANAL YIELD ANALYSIS PAGE 11 OCSF07522202 2005/05/31 RUN DATE 06/06/05 DISTRICT: LONG-TERM OPERATING RUN TIME 10,10,31 -----------------=================================================================================-· PAR VALUE YTM AT CURRENT MOODY MAJU<ET TO'..AL COST/ % TYPE SECURITY ID SECURITY DESCRIPTION BOOK YIELD S-P l'RI,:;E MAI KET VALUE % TOTAL ---------------------------------------------------------- --------------------------------------~---- s,soo,000.00 GOLDMAN SACHS MTN t TR 00216 .ooo 3,152 AA3 !!9. ":613 5,! 00, 196.C•O 1.42 38141EJZ3 VAR RT 08/01/2006 DD 02/01/05 A+ 5,£,98,240.00 1.36 2so,ooo.oo HSOC BK USA MTN tSR00012 .ooo 3,120 AA2 100. C•OO 250,170.00 .06 4042QOAM1 VAR RT 09/21/2007 DD 09/21/04 AA-250,000.00 .06 3,000,000.00 HSilC FIN CORP MTN t TR 00002 .000 3.360 Al 100.000 3,000,000.00 ,77 40429JAB3 VAR RT 02/28/2007 DD 03/29/05 A 3,000,000.00 .74 3,000,000.00 HSilC FIN CORP MTN t TR 00007 ,000 3,482 Al 99,953 2,995,830.00 ,77 40429JAG2 VAR RT 05/10/2010 DD 05/10/05 A 2,998,590.00 ,74 2,500,000.00 HOUSEHOLD FIN CORP NT .000 6,960 A2 103,.;53 2,! 91,500.00 .67 441812GH1 7.200% 07/15/2006 DD 07/15/99 A 2,! 86,325.00 .64 2,000,000.00 MORGAN STANLEY .000 3.268 AA3 100. 46 2,(02,980,00 .51 61746BAK2 VAR RT 01/12/2007 DD 01/13/04 A+ 2,(00,920.00 .so 3,200,000.00 MORGAN STANLEY NT .000 3,935 AA3 98. ,, 8-1 3,]49,248.00 .81 61746BALO 3.875% 01/15/2009 DD 01/13/04 A+ 3,]51,488.00 ,78 650,000,00 MORGAN STANLEY NT .ooo 3,288 AA3 100,015 650,000.00 .16 61746SAZ2 VAR RT 11/09/2006 DD 11/12/04 A+ 650,097.50 ,16 474,929.64 RESIDENTIAL ASSET 03-RSll AIIB .ooo 3,415 AAA 100.141 474,929.64 .12 760985K83 VAR RT 12/25/2033 DD 12/30/03 AAA 475,599.29 ,12 2,774,342.07 SBA GTD DEV PARTN 2001-20C 1 ,000 5,916 AAA 107.170 2,774,342.07 ,77 83162CLJO 6.340% 03/01/2021 AAA 2,973,262.40 ,74 1,625,857.81 SBA GTD PARTN CTFS SBIC-PS 01 ,000 6,268 AAA 105.935 1,125,857.81 ,44 831641DD4 6,640% 02/10/2011 DD 02/21/01 NR 1, ·, 22,352.47 ,43 2,000,000.00 TOYOTA MTR CR MTN tTR00413 .ooo 3,031 AAA 99.,63 1,~'98, 188.00 ,51 89233PTE6 VAR RT 09/18/2006 DD 03/16/05 AAA 1,!:99,360 .00 .so 1,600,000.00 UNITED AIRLS PASSTHRU 01-1 C .000 46.187 WR 14. ,90 1,loo,000.00 .06 909317BC2 6.831% 03/01/2010 DD 08/22/01 A-,:36,640.00 .06 20,000,000.00 US TREASURY NOTES .ooo 5,981 AAA 104.500 22,620,312.50 5.42 9128272JO 06,250% 02/15/2007 DD 02/15/97 AAA 20,900,000.00 5.18 2,512,020.00 US TREASURY INFLATION INDEX NT ,000 3,399 AAA 106.656 2,727,383.91 .69 9128273T7 3.625% 01/15/2008 DD 01/15/98 AAA 2,679,232.61 .66 YLDANAL YIELD ANALYSIS PAGE 12 OCSF07522202 2005/05/31 RUN DATE 06/06/05 DISTRICT: LONG-TERM OPERATING RUN TIME 10,10,31 -----=----=---==---===-================================================================:.:=-===========·================::========== PAR VALUE YUi AT CURRENT MOODY MluU<i·.T TO~AL COSTi % TYPE SECURITY ID SECURITY DESCRIPTION BOOK YIELD S-P l'RI"E MAT KET VALUE % TOTAL --------------_________ . _____ ,_. _______________ --------------------------------· ----------------- 11,194,420.00 US TREASURY INFLATION INDEX NT .ooo 3.534 AAA 109,656 12,::75,302.59 3.18 9128274Y5 3.875% 01/15/2009 DD 01/15/99 AAA 12,275,409,17 3.04 3,900,000.00 US TREASURY NOTES .000 5.683 AAA 101.J 88 4,288,149.14 1.02 9128276N7 05.750% 11/15/2005 DD 11/15/00 AAA 3,~46,312.50 .98 10,900,000.00 US TREASURY NOTES .000 3,409 AAA 99.000 10,684,196.02 2.79 912828BT6 3.375% 12/15/2008 DD 12/15/03 AAA 10,791,000,00 2.67 2,405,524.00 US TREASURY INFLATION INDEXED .000 1.932 AAA 103,'.:;10 2,456,826.25 .64 912828BW9 2,000% 01/15/2014 DD 01/15/04 AAA 2,~89,957.89 ,62 12,soo,000.00 US TREASURY NOTES .000 2 ,769 AAA 99. ·OJ 12,, 83,394.83 3.22 912828CMO 2,750% 06/30/2006 DD 06/30/04 AAA 12,, 12,500.(10 3.08 3,178,213.00 US TREASURY INFLATION INDEX NT ,000 1.932 AAA 103.·10 3,:66,149.04 .es 912828CP3 2.000% 07/15/2014 DD 07/15/04 AAA 3,;:09,768,28 .82 14,000,000.00 US TREASURY NOTES .ooo 2,772 AAA 99 •. ,20 14,(,29,693,55 3.60 912828CQ1 2.750% 07/31/2006 DD 07/31/04 AAA 13,890,800.00 3.44 55,300,000.00 US TREASURY NOTES .000 2,407 AAA 98.G80 55,018,326.59 14.15 912828CU2 2.375% 08/31/2006 DD 08/31/04 AAA 54,570,040,00 13.53 20,000,000.00 US TREASURY NOTES .000 2,902 AAA 99.060 20,640,268,90 5.34 912828DD9 2,875% 11/30/2006 DD 11/30/04 AAA 20,604,480.00 5.11 13,920,000.00 US TREASURY NOTES .ooo 3,535 AAA 99.010 13,733,493.75 3.57 912828DE7 3.500% 12/15/2009 DD 12/15/04 AAA 13,782,192,00 3,42 20,100,000.00 US TREASURY NOTES .ooo 3.958 AAA 101.%:'.l 20,:34,984.34 5,42 912828DP2 4.000% 03/15/2010 DD 03/15/05 AAA 20,i:19,420.00 5.18 42,300,000.00 UNITED STATES TREASURY NT .ooo 3.739 AAA 100. -00 42,'26,904.74 11.00 912828DQO 3,750% 03/31/2007 DD 03/31/05 AAA 42, ,; 26,900, 00 10.52 10,000,000.00 UNITED STATES TREASURY NTS .ooo 3.958 AAA 101. 060 10,C.45,296.45 2,62 912828DR8 4.000% 04/15/2010 DD 04/15/05 AAA 10,]06,000.00 2,50 1,750,000.00 VIRGINIA ELEC & PWR 01 SER A .ooo 5.663 A3 101. 531 1,743,840.00 .46 927804ENO 5.750% 03/31/2006 DD 03/27/01 BBB+ 1,776,792.50 .44 8,433,351.50 US TREASURY INFLATION INDEX NT 3.817 3.242 AAA 104,094 7,493,311.58 2,27 9128272M3 3,375% 01/15/2007 DD 01/15/97 AAA 8,778,612,91 2,18 • YLDANAL OCSF07522202 DISTRICT: LONG-TERM OPERATING YIELD ANALYSIS 2005/05/31 PAGE RUN DATE RUN TIME 13 06/06/05 10,10.31 ==---==--===---==--===-=====-====-====-====-=====--===---==---==--===---==---===--==---= . =----==-----=-===----=.:;::::==-==--==---. - PAR VALUE Yrlt AT CURRENT MOODY Ml\IUC .. T TO'i AL COST/ % TYPE SECURITY ID SECURITY DESCRIPTION BJOK YIELD S-P l'RLE MAlKET VALUE % TOTAL -------------------------------------------------------------------------------------------------- 761,686.74 FHLMC MULTICLASS MTG SER E3 A 6.316 3.951 AAA 100.,03 -;62,498.]9 .19 3133TCE95 VAR RT 08/15/2032 DD 12/01/97 AAA ·;62,471.28 .19 440,981.53 GNMA GTD REMIC TR 2000-9 FH 5.320 3.563 AAA 100.757 440,981.53 .ll 3837H4NX9 VAR RT 02/16/2030 AAA 444,319.76 ,ll 175,919.58 GNMA II POOL t0B00BBM 6.705 3,329 AAA 101. 395 ]79,767.82 .04 36225CC20 7.375% 06/20/2027 DD 06/01/97 AAA 178,373.66 ,04 140,546.51 GNMA II POOL t0080023 6 ,992 4.066 AAA 101.t.51 ]42,874,30 ,03 36225CAZ9 VAR RT 12/20/2026 DD 12/01/96 AAA ]42,585,84 .04 2,100,000.00 FEDERAL NATL MTG ASSN DEBS 7. ll3 6.015 AAA 110.,45 2,c 30,133.oo .60 31359MEYS 6,625% 09/15/2009 DD 09/01/99 AAA 2,: 13,045.00 .57 931,984.36 WMP/HUNTOON PAIGE t000-11150 7.684 7,410 AAA 10.L. 12 !11,742.82 ,24 302998GE3 7.500% 12/01/2030 DD 10/21/99 AAA ~43,277,12 ,23 --------------------------------------- TOTAL FIXED INCOME SECURITIES ,024 4 .341 387,:•27,512,27 100.00 385,428,522,85 95.46 ---------------------·-------------------- TOTAL .024 4.327 405,361,539,12 100.00 403,462,549,70 100.00 ===== @ Asset Detail Report ID: GL8013 Mellon Base Currency: USD by Currency Alternate Base Currency: Exchange Rate: OCSD-CONSOUDATED-OCSGOOOlOOOO 5/31/2005 Status: FfflAL Net Unrealized Price ;~i.:-~'_}f~: .--"•~ Cost Market Value %of Gain/Loss Description ' ., ·i: Base Shares Par Base Base Total Base -'. U.S. DOLLAR CASH & CASH EQUIVALENTS RECEIVABLE FOR INVESTMENTS 1,742.11 1,742.11 0.00% 0.00 SOLD PAYABLE FOR INVESTMENTS -65,034,746.52 -65,034,746.52 -15.65% 0.00 PURCHASED INTEREST RECEIVABLE 3,474,538.14 3,474,538.14 0.84% 0.00 FEDERAL HOME LN BK CONS DISC 99.9178 5,000,000.000 4,995,888.89 4,995,888.89 1.20% 0.00 MAT 6/10/2005 SEC ID: 313385GS9 FEDERAL HOME LN BK CONS DISC 99.8109 4,000,000.000 3,992,435.56 3,992,435.56 0.96% 0.00 MAT 06/15/2005 SEC ID: 313385GX8 FEDERAL HOME LN BK CONS DISC N 99.7944 6,200,000.000 6,187,255.55 6,187,255.55 1.49% 0.00 MAT 06/17/2005 SEC ID: 313385GZ3 FEDERAL HOME LN BK CONS DISC N 99.4993 4,800,000.000 4,775,967.33 4,775,967.33 1.15% 0.00 MAT 07/22/2005 SEC ID: 313385JL1 FEDERAL HOME LN MTG CORP DISC 99.3233 2,000,000.000 1,986,466.67 1,986,466.67 0.48% 0.00 MAT 06/14/2005 SEC ID: 313397GW5 FEDERAL HOME LN MTG CORP DISC 99.1483 4,000,000.000 3,965,933.33 3,965,933.33 0.95% 0.00 MAT 06/30/2005 SEC ID: 313397HN4 FEDERAL HOME LN MTG ASSN DISC 99.2360 3,000,000.000 2,977,080.00 2,977,080.00 0.72% 0.00 MAT 07/12/2005 SEC ID: 313397JA0 FEDERAL HOME LN MTG CORP DISC 99.3972 1,100,000.000 1,093,369.44 1,093,369.44 0.26% 0.00 MAT 08/02/2005 SEC ID: 313397JX0 FEDERAL HOME LN MTG CORP DISC 99.2447 2,000,000.000 1,984,893.33 1,984,893.33 0.48% 0.00 MAT 08/09/2005 SEC ID: 313397KE0 FEDERAL HOME LN MTG CORP DISC 99.2027 500,000.000 496,013.33 496,013.33 0.12% 0.00 MAT 08/23/2005 SEC ID: 313397KU4 FEDERAL NATL MTG ASSN DISCOUNT 99.2518 1,000,000.000 992,517.78 992,517.78 0.24% 0.00 MAT 06/29/2005 SEC ID: 313589HM8 6/7/2005 10:5 7:54AM PDT 1 Workbench @ Asset Detail Report ID: GL8013 Mellon Base Currency: USD by Currency Alternate Base Currency: Exchange Rate: OCSD-CONSOLIDATED-OCSGOOOlOOOO 5/31/2005 Status: FINAL Net Unrealized Price :;,~,,/_ ' .. ' Cost .1t Market Value %of Gain/Loss . -:;;,.~t;. a.ti-! ,-. Description t;'f--' Shares Par Total II Base Base -· -Base J;, .:..~:ti,. Base FEDERAL NATL MTG ASSN DISC 98.8462 1,000,000.000 988,461.67 988,461.67 0.24% 0.00 08/01/2005 SEC ID : 313589JW4 FEDERAL NATL MTG ASSN DISCOUNT 99.1782 6,000,000.000 5,950,691.67 5,950,691.67 1.43% 0.00 MAT 08/08/2005 SEC ID: 313589KD4 FEDERAL NATL MTG ASSN DISCOUNT 99.2214 2,500,000.000 2,480,536.11 2,480,536.11 0.60% 0.00 MAT 08/10/2005 SEC ID: 313589KF9 FEDERAL NATL MTG ASSN DISCOUNT 98.3671 4,000,000.000 3,934,682.22 3,934,682.22 0.95% 0.00 MAT 10/26/2005 SEC ID: 313589NL3 GENERAL ELEC CAP DISC 99.2400 2,000,000.000 1,984,800.00 1,984,800.00 0.48% 0 .00 07/11/2005 SEC ID: 36959HUB1 GENERAL ELEC CAP DISC 99.2275 1,000,000.000 992,275.00 992,275.00 0.24% 0.00 07/25/2005 SEC ID: 36959HUR6 UBS AG STAMFORD BRH INSTL C/D 99.9550 10,000,000.000 9,995,500.00 9,995,500.00 2.41% 0.00 VAR RT 07/05/2005 DD 07 /02/04 SEC ID: 90261GE47 U S TREASURY BILL 98.9002 7,000,000.000 6,923,014.00 6,923,014.00 1.67% 0.00 DUE 07/21/2005 DD 01/20/2005 SEC ID: 912795VH1 U S TREASURY BILL 99.1180 2,000,000.000 1,982,359.44 1,982,359.44 0.48% 0.00 0.000% 08/04/2005 DD 02/03/05 SEC ID: 912795VK4 U S TREASURY BILL 98.5164 2,000,000.000 1,970,327.92 1,970,327.92 0.47% 0.00 10/13/2005 DD 04/14/2005 SEC ID: 912795W0 CS FOB CAT 2 REPO REPO 100.0000 13,000,000.000 13,000,000.00 13,000,000.00 3.13% 0.00 02.940% 06/01/2005 DD 05/31/05 SEC ID: 99436A319 DREYFUS TREASURY CASH MGMT 100.0000 1,484,104.430 1,484,104.43 1,484,104.43 0.36% 0.00 SEC ID: 996085247 TOTAL CASH & CASH EQUIVALENTS 85,584,104.430 23,576,107.40 23,576,107.40 5.67% 0.00 FIXED INCOME SECURITIES AIG SUNAMERICA GLOBAL REGS 109.8670 752,000.000 826,199.84 826,199.84 0.20% 0.00 5.850% 08/01/2008 DD 08/08/01 SEC ID: U00907 AA0 6/7/2005 10:57:54AM PDT 2 Workbench @ Asset Detail Report ID: GL8013 Mellon Base Currency: USD by Currency Alternate Base Currency: Exchange Rate: OCSD-CONSOU.DATED-OCSGOOOlOOOO 5/31/2005 Status: FINAL Net Unrealized Price . ~ Cost ti. ;,,c Market Value r1u \ %of Gain/Loss ,.·.1. ..... 1.• Description -.... f~_\· • ~ '1 -Base .. , Shares Par Base Base . l1l7 Total 1;/ ,,., Base ~ ~ .,'l• /" ASSOCIATES CORP NORTH AMER SR 100.1090 3,000,000.000 3,112,350.00 3,003,270.00 0.72% -109,080.00 6.625% 06/15/2005 DD 06/09/95 SEC ID: 046003FF1 BANK AMER N A TRANCHE #TR00255 100.0000 3,500,000.000 3,499,940.20 3,500,000.00 0 .84% 59.80 VAR RT 08/08/2005 DD 02/07 /05 SEC ID: 06050VLQ8 CIT GROUP INC SR NT 105.6552 3,000,000.000 3,169,560.00 3,169,655.91 0.76% 95.91 7.375% 04/02/2007 DD 04/01/02 SEC ID: 125581AA6 CIT GROUP INC NEW SR NT 100.4210 1,500,000.000 1,507,005.00 1;506,315.oo 0.36% -690.00 VAR RT 09/22/2006 DD 09/23/03 SEC ID: 125581AF5 CIT GROUP INC MTN #SR00092 99.9370 3,300,000.000 3,300,000.00 3,297,921.00 0.79% -2,079.00 VAR RT 05/23/2008 DD 05/25/05 SEC ID: 12560PDV0 CITIGROUP INC GLOBAL SR NT 99.9370 1,600,000.000 1,600,000.00 1,598,992.00 0.38% -1 ,008.00 VAR RT 05/02/2008 DD 05/02/05 SEC ID: 172967CW9 WMP /HUNTOON PAIGE #000-11150 101.2117 931,984.360 911,742.82 943,277.12 0.23% 31,534.30 7.500% 12/01/2030 DD 10/21/99 SEC ID: 302998GE3 FEDERAL HOME LN MTG CORP MTN 99.1400 10,000,000.000 9,993,100.00 9,914,000.00 2.39% -79,100.00 4.000% 09/22/2009 DD 09/22/04 SEC ID: 3128X3WY5 FHLMC MULTICLASS MTG SER E3 A 100.1030 761,686.740 762,498.19 762,471.28 0.18% -26.91 VAR RT 08/15/2032 DD 12/01/97 SEC ID: 3133TCE95 FHLMC GROUP #78-6064 103.3950 50,890.020 49,649.57 52,617.74 0.01% 2,968.17 6.384% 01/01/2028 DD 12/01/97 SEC ID: 31348SWZ3 FEDERAL NATL MTG ASSN DEBS 110.1450 2,100,000.000 2,030,133.00 2,313,045.00 0.56% 282,912.00 6 .625% 09/15/2009 DD 09/01/99 SEC ID: 31359MEY5 FEDERAL NATL MTG ASSN DEBS 101.4850 2,350,000.000 2,385,461.50 2,384,897.50 0.57% -564.00 5.250% 06/15/2006 DD 06/22/01 SEC ID: 31359MJX2 FNMA POOL #0254510 101.3130 599,407.150 617,389.36 607,277.37 0.15% -10,111.99 5.000% 11/01/2017 DD 10/01/02 SEC ID: 31371KVB4 FNMA POOL #0254631 101.3070 128,951.930 132,820.49 130,637.33 0.03% -2, 183.16 5.000% 02/01/2018 DD 01/01/03 SEC ID: 31371KY47 6/7/2005 10:57:54AM PDT 3 Workbench @ Asset Detail Report ID: GL8013 Mellon Base Currency: USD by Currency Alternate Base Currency: Exchange Rate: OCSD-CO.NSOUDATED -OCSGOO0 10000 5/31/2005 Status: FINAL Net Unrealized Price -., ,_ 1 -Cost :-:.1• Market Value %of Gain/Loss --I" ; h-.~~ '. · Shares Par _I~ ~ 7 Description Base .: :J Base ·i-• Base Total ' . ' Base 1 :'~ ~ L'I.. -• ":':"I .•• ':. ),= t -FNMA POOL #0254760 101.2940 115,683.470 119,153.96 117,180.41 0.03% -1,973.55 5.000% 06/01/2018 DD 05/01/03 SEC ID: 31371K5V9 FNMA POOL #0254866 101.2840 52,903.390 54,490.50 53,582.67 0.01% -907.83 5.000% 09/01/2018 DD 08/01/03 SEC ID: 31371LCB3 FNMA POOL #0254907 101.2810 392,881.340 392,881.34 397,914.15 0.10% 5,032.81 5.000% 10/01/2018 DD 09/01/03 SEC ID: 31371LDLO FNMA POOL #0254953 101.2780 279,458.040 283,038.61 283,029.51 0.07% -9.10 5.000% 11/01/2018 DD 10/01/03 SEC ID: 31371LE21 FNMA POOL #0254987 101.1987 755,338.630 765,016.40 764,392.57 0.18% -623.83 5.000% 12/01/2018 DD 11/01/03 SEC ID: 31371LF46 FNMA POOL #0323980 103.6090 126,370.620 131,938.82 130,931.34 0.03% -1,007.48 6.000% 04/01/2014 DD 09/01/99 SEC ID: 31374T2M0 FNMA POOL #0357328 101.2289 21,688.780 22,339.45 21,955.32 0.01% -384.13 5.000% 01/01/2018 DD 01/01/03 SEC ID: 31376J4M8 FNMA POOL #0357430 101.2910 1,146,434.100 1,159,331.48 1,161,234.56 0.28% 1,903.08 5.000% 09/01/2018 DD 09/01/03 SEC ID: 31376KA71 FNMA POOL #0456482 103.6090 35,768.660 37,344.70 37,059.55 0.01% -285.15 6.000% 02/01/2014 DD 02/01/99 SEC ID: 31381CCT2 FNMA POOL #0509649 103.6090 95,550.180 99,760.36 98,998.59 0.02% -761.77 6.000% 09/01/2014 DD 09/01/99 SEC ID: 31383QEW0 FNMA POOL #0535451 103.6090 97,836.610 102,147.54 101,367.53 0.02% -780.01 6.000% 06/01/2015 DD 07 /01/00 SEC ID: 31384VZQ8 FNMA POOL #0555363 101.3030 277,179.640 285,495.02 280,791.29 0.07% -4,703.73 5.000% 04/01/2018 DD 03/01/03 SEC ID: 31385W5Yl FNMA POOL #0555453 101.3000 28,790.830 29,159.72 29,165.11 0.01% 5.39 5.000% 05/01/2018 DD 04/01/03 SEC ID: 31385XBW6 FNMA POOL #0555545 101.3000 231,111.030 238,044.37 234,115.47 0.06% -3,928.90 5.000% 06/01/2018 DD 05/01/03 SEC ID: 31385XES2 6/7/2005 10:57:54AM PDT 4 Workbench @ Asset Detail Report ID: GL8013 Mellon Base Currency: USD by Currency Alternate Base Currency: Exchange Rate: OCSD-CONSOUDATED-OCSGOOOlOOOO 5/31/2005 Status: FINAL Net 'Unrealized Price Cost Market Value %of ~ 6;1,-, r ~. ;,• .,,.. 'I Gain/Loss ,.-I -~ ~ Description Ir t .. , !-'· I Base, ... Shares Par j1,-',l ... {~l:~~ Base" Base Total ._![ -. -Base FNMA POOL #0555621 101.1987 790,841.290 799,738.25 800,320.79 0.19% 582.54 5.000% 07/01/2018 DD 06/01/03 SEC ID: 31385XG68 FNMA POOL #0681309 101.3070 435,068.620 448,120.68 440,754.97 0.11% -7,365.71 5.000% 02/01/2018 DD 02/01/03 SEC ID: 31391Y3S4 FNMA POOL #0681334 101.3070 52,181.360 53,746.81 52,863.37 0.01% -883.44 5.000% 02/01/2018 DD 01/01/03 SEC ID: 31391Y4Tl FNMA POOL #0684798 101.6010 333,981.190 333,694.18 339,328.23 0.08% 5,634.05 5.500% 03/01/2033 DD 03/01/03 SEC ID: 31400DX31 FNMA POOL #0684908 101.2940 284,959.410 288,610.47 288,646.78 0.07% 36.31 5.000% 06/01/2018 DD 05/01/03 SEC ID: 31400D3Rl FNMA POOL #0685200 101.3000 155,888.910 157,886.26 157,915.47 0.04% 29.21 5.000% 03/01/2018 DD 03/01/03 SEC ID: 31400EGH7 FNMA POOL #0685665 101.3070 26,313.670 27,103.08 26,657.59 0.01% -445.49 5.000% 02/01/2018 DD 02/01/03 SEC ID: 31400EW22 FNMA POOL #0686318 101.3030 236,120.920 243,204.54 239,197.58 0.06% -4,006.96 5.000% 03/01/2018 DD 03/01/03 SEC ID: 31400FPB7 FNMA POOL #0688739 101.2940 90,741.070 93,463.30 91,915.26 0.02% -1,548.04 5.000% 06/01/2018 DD 06/01/03 SEC ID: 3 l 400JEL9 FNMA POOL #0689859 101.2940 81,450.200 82,493.78 82,504.17 0.02% 10.39 5.000% 05/01/2018 DD 05/01/03 SEC ID: 31400KMG8 FNMA POOL #0693834 101.3030 489,209.840 503,886.12 495,584.24 0.12% -8,301.88 5.000% 03/01/2018 DD 03/01/03 SEC ID: 31400PY74 FNMA POOL #0695852 101.2970 182,816.080 188,300.56 185,187.20 0.04% -3,113.36 5.000% 05/01/2018 DD 05/01/03 SEC ID: 31400SBV0 FNMA POOL #0695889 101.2970 635,468.810 654,532.89 643,710.84 0.15% -10,822.05 5.000% 05/01/2018 DD 05/01/03 SEC ID: 31400SC23 FNMA POOL #0697026 101.2970 19,276.870 19,855.19 19,526.89 0 .00% -328.30 5.000% 05/01/2018 DD 04/01/03 SEC ID: 31400TLF2 6/7/2005 10:57:54AM PDT 5 Workbench @ Asset Detail Report ID: GL8013 Mellon Base Currency: USD by Currency Alternate Base Currency: Exchange Rate: OCSl>CONSOUDATED -OCSGOO0 10000 5/31/2005 Status: FINAL Net Unrealized Price . ' ,. Cost Market Value %of Gain/Loss .,. ·':""' ~-.. , ,, Description :c~ ~ J .. ~;:__ ., Shares Par :., ... : Base Total ,. Base Base flt Base ";,4:"'. •1 L -L'' ,. - FNMA POOL #0702210 101.1987 195,793.370 201,667.17 198,140.27 0.05% -3,526.90 5.000% 05/01/2018 DD 05/01/03 SEC ID: 31401ADP9 FNMA POOL #0702328 101.2970 110,618.660 112,035.96 112,053.38 0.03% 17.42 5.000% 05/01/2018 DD 04/01/03 SEC ID: 31401AHD2 FNMA POOL #0709148 101.2910 241,073.170 248,305.38 244,185.42 0.06% -4,119.96 5.000% 06/01/2018 DD 06/01/03 SEC ID: 31401HZM7 FNMA POOL #0709360 101.2910 531,620.320 538,431.71 538,483.54 0.13% 51.83 5.000% 07/01/2018 DD 06/01/03 SEC ID: 31401JB56 FNMA POOL #0709826 101.2940 93,107.350 94,300.28 94,312.16 0.02% 11.88 5.000% 06/01/2018 DD 06/01/03 SEC ID: 31401JSP4 FNMA POOL #0709917 101.2940 192,386.190 194,851.14 194,875.67 0.05% 24.53 5.000% 06/01/2018 DD 06/01/03 SEC ID: 31401JVJ4 FNMA POOL #0709963 101.1987 17,577.580 17,802.80 17,788.28 0.00% -14.52 5.000% 06/01/2018 DD 06/01/03 SEC ID: 31401JWYO FNMA POOL #0710235 101.2910 484,095.460 498,618.35 490,345.13 0.12% -8,273.22 5.000% 06/01/2018 DD 06/01/03 SEC ID: 31401KBC8 FNMA POOL #0713344 101.2940 13,031.280 13,422.21 13,199.90 0.00% -222.31 5.000% 06/01/2018 DD 06/01/03 SEC ID: 31401NP52 FNMA POOL #0713365 101.2910 211,983.800 214,699.83 214,720.51 0.05% 20.68 5.000% 07/01/2018 DD 07 /01/03 SEC ID: 31401NQS1 FNMA POOL #0720319 101.2910 603,209.510 610,938.14 610,996.94 0.15% 58.80 5.000% 07/01/2018 DD 07 /01/03 SEC ID: 31401WG45 FNMA POOL #0720369 101.1987 1,904,678.240 1,961,818.59 1,927,508.86 0.46% -34,309.73 5.000% 06/01/2018 DD 06/01/03 SEC ID: 31401WJN0 FNMA POOL #0721629 101.2910 258,250.120 265,997.64 261,584.13 0.06% -4,413.51 5.000% 07/01/2018 DD 06/01/03 SEC ID: 31401XVW4 FNMA POOL #0723487 101.2910 186,281.810 188,377.49 188,686.71 0.05% 309.22 5.000% 06/01/2018 DD 06/01/03 SEC ID: 31402AXQ4 6/7/2005 10:57:54AM PDT 6 Workbench @ Asset Detail Report ID: GL8013 Mellon Base Currency: USD by Currency Alternate Base Currency: Exchange Rate: OCSD-CONSOUDATED-OCSGOO0lO0OO 5/31/2005 Status: FINAL Net Unrealized Price .. ,~ •. " ''l ~=u . : .. Cost . i, Market Value %of Gain/Loss Description ~~ ... -Ba.se • Shares Par .\,••,~; :r [JI.• t• ,I. • ,._ Base Base Total .. -~ Base FNMA POOL #0725530 101.1735 2,938,834.430 2,978,784.19 2,973,320.21 0.72% -5,463.98 5.000% 06/01/2019 DD 05/01/04 SEC ID: 31402DA75 FNMA POOL #0729601 101.2880 347,903.860 352,361.38 352,384.86 0.08% 23.48 5.000% 07/01/2018 DD 07 /01/03 SEC ID: 31402HRW3 FNMA POOL #0732873 101.2780 31,158.400 31,557.60 31,556.60 0.01% -1.00 5.000% 11/01/2018 DD 10/01/03 SEC ID: 31402MFNS FNMA POOL #0735227 101.4950 1,000,000.710 1,008,438.22 1,014,950.72 0.24% 6,512.50 5.500% 02/01/2035 DD 01/01/05 SEC ID: 31402QYY1 FNMA POOL #0737130 101.2840 566,288.460 573,544.03 573,559.60 0.14% 15.57 5.000% 10/01/2018 DD 10/01/03 SEC ID: 31402S4P9 FNMA POOL #0738211 101.1987 450,196.110 455,964.27 455,592.43 0.11% -371.84 5.000% 10/01/2018 DD 10/01/03 SEC ID: 31402UDQ2 FNMA POOL #0738487 101.2780 160,577.140 162,634.54 162,629.32 0.04% -5.22 5.000% 10/01/2018 DD 10/01/03 SEC ID: 31402UNC2 FNMA POOL #0740457 101.1987 1,932,682.600 1,958,955.00 1,955,848.89 0.47% -3,106.11 5.000% 10/01/2018 DD 10/01/03 SEC ID: 31402WTN8 FNMA POOL #0740471 101.1987 649,108.760 657,425.45 656,889.37 0.16% -536.08 5.000% 10/01/2018 DD 10/01/03 SEC ID: 31402WT40 FNMA POOL #0740748 101.2840 671,014.710 679,612.08 679,630.54 0.16% 18.46 5.000% 10/01/2018 DD 11/01/03 SEC ID: 31402WSH7 FNMA POOL #0743868 101.1987 32,357.890 32,772.48 32,745.75 0.01% -26.73 5.000% 11/01/2018 DD 10/01/03 SEC ID: 31403BMR1 FNMA POOL #0744008 101.2940 876,457.730 887,687.35 887,799.09 0.21% 111.74 5.000% 07/01/2018 DD 09/01/03 SEC ID: 31403BR54 FNMA POOL #0744316 101.1987 137,192.320 138,950.10 138,836.79 0.03% -113.31 5.000% 09/01/2018 DD 09/01/03 SEC ID: 31403B3Z4 FNMA POOL #0747914 101.2780 286,940.400 290,616.84 290,607.50 0.07% -9.34 5.000% 11/01/2018 DD 11/01/03 SEC ID: 3 l 403F3XO 6/7/2005 10:57:54AM PDT 7 Workbench @ Asset Detail Report ID: GL8013 Mellon Base Currency: USD by Currency Alternate Base Currency: Exchange Rate: OCSD-CONSOUDATED-OCSGOOOlOOOO 5/31/2005 Status: FINAL Net Unrealized Price . J ...,,-. .t ·r.1• l, _ ., ~ "" ;t,11 Cost .,'J... Market Value _!.( %of Gain/Loss -:.1 ' '·!,; •• ' --,.; Description J" ~L Base '.I' ·,.., Shares Par ·,-'_\·..,*:' Bu e Base ~L Total I t Base -....... FNMA POOL #0748400 101.1987 168,969.760 171,134.69 170,995.13 0.04% -139.56 5.000% 08/01/2018 DD 09/01/03 SEC ID: 31403GNR9 FNMA POOL #0748899 101.1987 844,489.660 855,309.68 854,612.22 0.21% -697.46 5.000% 12/01/2018 DD 11/01/03 SEC ID: 31403G7LO FNMA POOL #0750377 101.1987 1,867,480.770 1,891,407.86 1,889,865.51 0.45% -1,542.35 5.000% 11/01/2018 DD 11/01/03 SEC ID: 31403JUA2 FNMA POOL #0750380 101.1987 1,555,399.760 1,575,328.33 1,574,043.71 0.38% -1,284.62 5.000% 11/01/2018 DD 11/01/03 SEC ID: 31403JUD6 FNMA POOL #0750445 101.1987 162,422.560 164,503.60 164,369.45 0.04% -134.15 5.000% 11/01/2018 DD 11/01/03 SEC ID: 31403JWE2 FNMA POOL #0751960 101.1987 690,752.340 699,602.62 699,032.11 0.17% -570.51 5.000% 12/01/2018 DD 11/01/03 SEC ID: 31403LMH1 FNMA POOL #0753425 101.2750 743,529.720 752,126.77 753,009.72 0.18% 882.95 5.000% 11/01/2018 DD 11/01/03 SEC ID: 31403NA23 FNMA POOL #0755165 101.2750 539,727.560 546,642.82 546,609.09 0.13% -33.73 5.000% 12/01/2018 DD 11/01/03 SEC ID: 31403Q6A3 FNMA POOL #0756372 101.2750 851,706.870 861,554.73 862,566.13 0.21% 1,011.40 5.000% 11/01/2018 DD 11/01/03 SEC ID: 31403SJR8 FNMA POOL #0784251 101.2500 3,083,957.820 3,125,880.38 3,122,507.29 0.75% -3,373.09 5.000% 11/01/2019 DD 11/01/04 SEC ID: 31405BH46 FNMA POOL #0789670 101.2500 866,296.460 878,072.68 877,125.17 0.21% -947.51 5.000% 12/01/2019 DD 12/01/04 SEC ID: 31405HJP4 FNMA POOL #0792432 101.2500 852,726.080 864,317.83 863,385.16 0 .21% -932.67 5.000% 10/01/2019 DD 10/01/04 SEC ID: 31405LLM9 FNMA POOL #0792437 101.2500 4 ,940,802.520 4 ,940,802.52 5,002,562.55 1.20% 61 ,760.03 5.000% 10/01/2019 DD 10/01/04 SEC ID: 31405LLS6 FNMA POOL #0794195 101.2500 891,049.370 903,162.08 902,187.49 0.22% -974.59 5.000% 11/01/2019 DD 11/01/04 SEC ID: 31405NKG9 6/7/2005 10:57:54AM PDT 8 Workbench @ Mellon OCSD-CONSOUilA.TED-OCSGOO0 10000 Descrjption " -,, . •.t.i"lt-_ FNMA POOL #0797160 5.000% 12/01/2019 DD 12/01/04 SEC ID: 31405RTR7 FNMA POOL #0797408 5.000% 12/01/2019 DD 12/01/04 SEC ID: 31405R3R5 FNMA POOL #0797414 5.000% 12/01/2019 DD 12/01/04 SEC ID: 31405R3X2 FNMA POOL #0800370 5.000% 12/01/2019DD 11/01/04 SEC ID: 31405VFK8 FNMA POOL #0800998 5.500% 11/01/2034 DD 11/01/04 SEC ID: 31405V3F2 FNMA POOL #0803923 5.000% 12/01/2019 DD 12/01/04 SEC ID: 31406AD41 FNMA POOL #0807711 5.000% 01/01/2020 DD 01/01/05 SEC ID: 31406EKY9 FNMA POOL #0808933 5.500% 01/01/2035 DD 01/01/05 SEC ID: 31406FV24 FNMA POOL #0809350 5.500% 12/01/2034 DD 01/01/05 SEC ID: 31406GEX3 FNMA POOL #0814930 5.500% 04/01/2035 DD 04/01/05 SEC ID: 31406NLK8 FNMA POOL #0815923 5.500% 03/01/2035 DD 03/01/05 SEC ID : 31406PPG8 FNMA POOL #0816246 5.000% 03/01/2020 DD 03/01/05 SEC ID: 31406PZK8 FNMA POOL #0819566 5.500% 04/01/2035 DD 04/01/05 SEC ID: 31406TQT1 FNMA POOL #0822731 5.500% 05/01/2035 DD 05/01/05 SEC ID: 31406XA85 6/7/2005 10:57:54AM PDT Price Base 101.2500 101.2500 101.2500 101.2500 101.4950 101.2500 101.2500 101.4950 101.4950 101.4168 101.4950 101.2500 101.4950 101.4950 ... Asset Detail by Currency 5/31/2005 Shares Par ~-"' 3,121,687.980 797,630.310 791,966.890 367,259.610 332,280.070 3,043,034.020 2,988,999.950 332,674.920 332,920.210 334,821.880 334,699.830 632,640.440 333,440.260 332,404.000 9 Report ID: GL8013 ' Base Currency: USD Alternate Base Currency: Exchange Rate: Status: FINAL Net tTnreallzed Cost -Market Value %of Gain/Loss Base Base ' Total ' Base -- 3,164,123.41 3,160,709.08 0.76% -3,414.33 808,473.10 807,600.69 0.19% -872.41 802,732.68 801,866.48 0.19% -866.20 366,857.92 371,850.36 0.09% 4,992.44 331,994.52 337,247.66 0.08% 5,253.14 3 ,084,400.27 3,081,071.95 0 .74% -3,328.32 3,029,631.66 3,026,362.45 0.73% -3,269.21 332,389.03 337,648.41 0.08% 5,259.38 332,634.11 337,897.37 0.08% 5,263.26 334,534.14 339,565.55 0.08% 5,031.41 334,412.20 339,703.59 0.08% 5,291.39 631,948.49 640,548.45 0 .15% 8,599.96 333,153.71 338,425.19 0 .08% 5,271.48 332,118.34 337,373.44 0.08% 5,255.10 Wo,-kbench . @ Asset Detail Report ID: GL8013 Mellon Base Currency: USD by Currency Alternate Base Currency: Exchange Rate: OCSD-CONSOLIDA TED -OCSGOO0 10000 5/31/2005 Status: FINAL Net Unrealized Price l'" t ~ • ·"' I Cost ,. .lij-'"' Market Value %of Gain/Loss '· rP~ Description ... r. Base-,. .. ~'. Shares Par Base lJ' Base Total U, _•! Base ,!.. FNMA POOL #0823232 101.4950 332,479.000 332,193.27 337,449.56 0.08% 5,256.29 5.500% 06/01/2035 DD 05/01/05 SEC ID: 31406XSV5 FNMA POOL #0823787 101.2500 1,999,800.000 1,997,612.70 2,024,797.50 0.49% 27,184.80 5.000% 05/01/2020 DD 05/01/05 SEC ID: 31406YF47 GNMA POOL #0421389 104.9690 8,194.590 8,600.48 8,601.78 0.00% 1.30 6.500% 04/15/2026 DD 04/01/96 SEC ID: 36206UC23 GNMA POOL #0449851 104.7751 12,006.880 12,601.60 12,580.22 0.00% -21.38 6.500% 01/15/2028 DD 01/01/98 SEC ID: 36208FWL0 GNMA POOL #0466845 104.9300 32,475.830 34,084.40 34,076.89 0.01% -7.51 6.500% 06/15/2028 DD 06/01/98 SEC ID: 36209BTA6 GNMA POOL #0468052 104.9270 109,789.320 115,227.31 115,198.64 0.03% -28.67 6.500% 07/15/2028 DD 07 /01/98 SEC ID: 36209C5M4 GNMA POOL #04 76041 104.9300 121,824.950 127,668.75 127,830.92 0.03% 162.17 6.500% 06/15/2028 DD 06/01/98 SEC ID: 36209MZE7 GNMA POOL #04 78626 104.9130 119,691.880 125,433.35 125,572.34 0.03% 138.99 6.500%01/15/2029 DD 01/01/99 SEC ID: 36209QVT9 GNMA POOL #0480598 104.9190 28,576.100 29,946.85 29,981.76 0.01% 34.91 6.500% 10/15/2028 DD 10/01/98 SEC ID: 36209S3F6 GNMA POOL #0512235 104.8850 8,323.590 8,735.86 8,730.20 0.00% -5.66 6 .500% 11/15/2029 DD 11/01/99 SEC ID: 36211 GBC6 GNMA POOL #0514326 104.8960 77,618.750 81,342.02 81,418.96 0.02% 76.94 6.500% 07/15/2029 DD 07 /01/99 SEC ID: 36211JLF2 GNMA II POOL #0080023 101.4510 140,546.510 142,874.30 142,585.84 0.03% -288.46 VAR RT 12/20/2026 DD 12/01/96 SEC ID: 36225CAZ9 GNMA II POOL #080088M 101.3950 175,919.580 179,767.82 178,373.66 0.04% -1 ,394.16 7.375% 06/20/2027 DD 06/01/97 SEC ID: 36225CC20 GNMA II POOL #0080395 101.4840 154,218.750 152,821.14 156,507.36 0.04% 3,686.22 VAR RT 04/20/2030 DD 04/01/00 SEC ID: 36225CNM4 6/7/2005 10:57:54AM PDT 10 Workbench @ Asset Detail Report ID: GL8013 Mellon Base Currency: USD by Currency Alternate Base Currency: Exchange Rate: OCSD-CONSOU.DATED -OCSGOO0 10000 5/31/2005 Status: FINAL Net Un.realized Price ... /· • i.;:,u--.-, Cost Market Value %of Gain/Loss ' ., ~ ... " Oescriptlon _,;-. .:.-.. :· . .-.. ~-~-;r~ Base Shares Par ....... Base ·Base .: Total ..:.....~~~ .. _ Base GNMA II POOL #080408X 101.4830 1,378,585.960 1,364,584.69 1,399,030.39 0.34% 34,445.70 VAR RT 05/20/2030 DD 05/01/00 SEC ID: 36225CN28 GNMA II POOL #0080965 100.7820 1,260,635.870 1,259,847.96 1,270,494.04 0.31% 10,646.08 VAR RT 07/20/2034 DD 07 /01/04 SEC ID: 36225DCB8 GENERAL ELEC CO NT 100.0150 6,500,000.000 6,502,203.50 6,500,975.00 1.56% -1,228.50 VAR RT 10/24/2005 DD 10/24/03 SEC ID: 369604AZ6 GOLDMAN SACHS GRP MTN 100.1710 3,500,000.000 3,507,850.50 3,505,985.00 0.84% -1,865.50 #TR00194 VAR RT 10/27/2006 DD 10/29/03 SEC ID: 38141EJB6 GOLDMAN SACHS GRP MTN 100.0620 2,000,000.000 2,001,900.00 2,001,240.00 0.48% -660.00 #TR00203 VAR RT 03/30/2007 DD 04/01/04 SEC ID: 38141EJL4 GOLDMAN SACHS GRP MTN 100.4210 800,000.000 800,000.00 803,368.00 0.19% 3,368.00 #TR00207 VAR RT 07/23/2009 DD 07 /23/04 SEC ID: 38141EJQ3 GOLDMAN SACHS MTN# TR 00216 99.9680 5,500,000.000 5,500,196.00 5,498,240.00 1.32% -1,956.00 VAR RT 08/01/2006 DD 02/01/05 SEC ID: 38141EJZ3 GNMA GTD REMIC TR 2000-9 FH 100.7570 440,981.530 440,981.53 444,319.76 0.11% 3,338.23 VAR RT 02/16/2030 SEC ID: 3837H4NX9 HSBC BK USA MTN #SR00012 100.0000 250,000.000 250,170.00 250,000.00 0.06% -170.00 VAR RT 09/21/2007 DD 09/21/04 SEC ID: 4042Q0AM1 HSBC FIN CORP MTN # TR 00002 100.0000 3,000,000.000 3,000,000.00 3,000,000.00 0.72% 0.00 VAR RT 02/28/2007 DD 03/29/05 SEC ID: 40429JAB3 HSBC FIN CORP MTN # TR 00007 99.9530 3,000,000.000 2,995,830.00 2,998,590.00 0.72% 2,760.00 VAR RT 05/10/2010 DD 05/10/05 SEC ID: 40429JAG2 HOUSEHOLD FIN CORP NT 103.4530 2,500,000.000 2,591,500.00 2,586,325.00 0.62% -5,175.00 7.200% 07/15/2006 DD 07 / 15/99 SEC ID: 441812GH1 MORGAN STANLEY 100.0460 2,000,000.000 2,002,980.00 2,000,920.00 0.48% -2,060.00 VAR RT 01/12/2007 DD 01/13/04 SEC ID : 61746BAK2 6/7/2005 10:57:54AM PDT 11 Workbench @ Mellon OCSD-CONSOUDATED-OCSGOO0l00OO Description ,, -·' . -"' MORGAN STANLEY NT 3.875% 01/15/2009 DD 01/ 13/04 SEC ID: 61746BALO MORGAN STANLEY NT VAR RT 11/09/2006 DD 11/12/04 SEC ID: 61746SAZ2 RESIDENTIAL ASSET 03-RS 11 AIIB VAR RT 12/25/2033 DD 12/30/03 SEC ID: 760985K83 SBA GTD DEV PARTN 2001-20C 1 6.340% 03/01/2021 SEC ID: 83162CW0 SBA GTD PARTN CTFS SBIC-PS 01 6.640% 02/10/2011 DD 02/21/01 SEC ID: 831641DD4 TOYOTA MTR CR MTN #TR00413 VAR RT 09/18/2006 DD 03/16/05 SEC ID: 89233PTE6 UNITED AlRLS PASSTHRU 01-1 C 6.831% 03/01/2010 DD 08/22/01 SEC ID: 9093 l 7BC2 U S TREASURY NOTES 06.250% 02/15/2007 DD 02/ 15/97 SEC ID: 9128272J0 US TREASURY INFLATION INDEX NT 3.375% 01/15/2007 DD 01/15/97 SEC ID: 9128272M3 US TREASURY INFLATION INDEX NT 3.625% 01/15/2008 DD 01/15/98 SEC ID: 9128273T7 US TREASURY INFLATION INDEX NT 3 .875% 01/15/2009 DD 01/15/99 SEC ID: 9128274Y5 U S TREASURY NOTES 05.750% 11/15/2005 DD 11/15/00 SEC ID: 9128276N7 U S TREASURY NOTES 3.375% 12/15/2008 DD 12/15/03 SEC ID: 912828BT6 US TREASURY INFLATION INDEXED 2.000% 01/15/2014 DD 01/15/04 SEC ID: 912828BW9 6/7/2005 10:57:54AM PDT Price Base 98.4840 100.0150 100.1410 107.1700 105.9350 99.9680 14.7900 104.5000 104.0940 106.6565 109.6565 101.1875 99.0000 103.5100 Asset Detail by Currency 5/31/2005 Shares Par 3,200,000.000 650,000.000 474,929.640 2,774,342.070 1,625,857.810 2,000,000.000 1,600,000.000 20,000,000.000 8,433,351.500 2,512,020.000 11,194,420.000 3,900,000.000 10,900,000.000 2,405,524.000 12 Cost Base 3,149,248.00 650,000.00 474,929.64 2,774,342.07 1,625,857.81 1,998,188.00 1,600,000.00 22,620,312.50 7,493,311.58 2,727,383.91 12,375,302.59 4,288,149.14 10,684,196.02 2,456,826.25 Report ID: GL8013 Base Currency: USD Alternate Base Currency: Market Value Base, 3,151,488.00 650,097.50 475,599.29 2,973,262.40 1,722,352.47 1,999,360.00 236,640.00 20,900,000.00 8,778,612.91 2,679,232.61 12,275,409.17 3 ,946,312.50 10,791,000.00 2,489,957.89 Exchange Rate: Status: FINAL %of Total 0.76% 0.16% 0.11% 0.72% 0.41% 0.48% 0.06% 5.03% 2.11% 0.64% 2.95% 0.95% 2.60% 0.60% Net Oil.realized Gain/Loss Base - --- 2,240.00 97.50 669.65 198,920.33 96,494.66 1,172.00 -1,363 ,360. 00 -1,720,312.50 1,285,301.33 -48,151.30 -99,893.42 -341,836.64 106,803.98 33,131.64 Workbench @ Asset Detail Report ID: GL8013. Mellon Base Currency: USD by Currency Alternate Base Currency: Exchange Rate: OCSD-CONSOUDA.TED -OCSGOOO 10000 5/31/2005 Status: FINAL Net Unrealized Price ;,_ •• ~, '._/f ,~. ~ .... ~ Cost Market Value %of Gain/Loss C ·--Description •1!;:~ • l C.!/ Base Shares Par b.1 ~' I t '........ l • _Base Base Total H -~••·• • Base .IC ,-. --~-_.,... · .. U S TREASURY NOTES 99.3000 12,500,000.000 12,483,394.83 12,412,500.00 2.99% -70,894.83 2.750% 06/30/2006 DD 06/30/04 SEC ID: 912828CM0 US TREASURY INFLATION INDEX NT 103.5100 3,178,213.000 3,266,149.04 3,289,768.28 0.79% 23,619.24 2.000% 07/15/2014 DD 07 / 15/04 SEC ID: 912828CP3 U S TREASURY NOTES 99.2200 14,000,000.000 14,029,693.55 13,890,800.00 3.34% -138,893.55 2.750% 07/31/2006 DD 07 /31/04 SEC ID: 912828CQ1 U S TREASURY NOTES 98.6800 55,300,000.000 55,018,326.59 54,570,040.00 13.13% -448,286.59 2.375% 08/31/2006 DD 08/31/04 SEC ID: 912828CU2 U S TREASURY NOTES 99.0600 20,800,000.000 20,640,268.90 20,604,480.00 4.96% -35,788.90 2.875% 11/30/2006 DD 11/30/04 SEC ID: 912828DD9 U S TREASURY NOTES 99.0100 13,920,000.000 13,733,493.75 13,782,192.00 3.32% 48,698.25 3.500% 12/15/2009 DD 12/15/04 SEC ID: 912828DE7 U S TREASURY NOTES 101.0600 20,700,000.000 20,734,984.34 20,919,420.00 5.03% 184,435.66 4.000% 03/15/2010 DD 03/15/05 SEC ID: 912828DP2 UNITED STATES TREASURY NT 100.3000 42,300,000.000 42,426,904.74 42,426,900.00 10.21% -4.74 3.750% 03/31/2007 DD 03/31/05 SEC ID: 912828DQ0 UNITED STATES TREASURY NTS 101.0600 10,000,000.000 10,045,296.45 10,106,000.00 2.43% 60,703.55 4.000% 04/15/2010 DD 04/15/05 SEC ID: 912828DR8 VIRGINIA ELEC & PWR 0 1 SER A 101.5310 1,750,000.000 1,743,840.00 1,776,792.50 0.43% 32,952.50 5.750% 03/31/2006 DD 03/27 /01 SEC ID: 927804EN0 TOTAL FIXED INCOME SECURITIES 389,876,752.870 393,939,802.47 391,931,792.85 94.33% -2,008,009.62 TOTAL ASSETS U.S. DOLLAR 475,460,857.300 417,515,909.87 415,507,900.25 100.00% -2,008,009.62 TOTAL ASSETS -BASE: 475,460,857.300 417,515,909.87 415,507,900.25 100.00% -2,008,009.62 6/7/2005 10:57:54AM PDT 13 Workbench Transaction Detail < @ Report ID: EWBA09 Mellon Reported by Transaction Category Base Currency: USD OCSD-CONSOLIDATED[]][][2 0 60 0•••0000 5/2/2005-5/31/2005 Status: FINAL -, ,, -Trade Date -' ..... r , . .. ,• ~c ... l ,' ,:-.:-. -~ ·,;; Net Gain/Loss Tran ,. u • r : f,.' !""': 7f_,-' .... '. ,~ Cost Amount I •• • : ~.• Settle Date Base Price '• , . Type Description Reported Date Shares/Par '_ ... ~ ~ ·[ • ·, ,t~ Base :;~/-:-'~i ' Base Base -c., "'l __ --.., 1"'•1-t v· B LEHMAN CAT 1 REPO REPO 02 .900% 5/18/2005 100.0000 14,700,000.000 14,700,000.00 -14,700,000.00 0.00 05/ 19 /2005 DD 05/ 18 /05 5/18/2005 SEC ID: 99435N676 5/18/2005 BROKER: LEHMAN GOVT SECS INC, NY OCSF07511102: LIQUID OPER-PIMCO B LEHMAN CAT2 REPO 02.930%05/20/2005 DD 5/19/2005 100.0000 14,600,000.000 14,600,000.00 -14,600,000.00 0.00 05/19/05 5/19/2005 SEC ID: 99435Q455 5/19/2005 BROKER: LEHMAN GOVT SECS INC, NY OCSF07511102: LIQUID OPER-PIMCO B LEHMAN CAT 2 REPO 02.900% 05/23/2005 DD 5/20/2005 100.0000 14,000,000.000 14,000,000.00 -14,000,000.00 0.00 05/20/05 5/20/2005 SEC ID: 99435R834 5/20/2005 BROKER; LEHMAN GOVT SECS INC, NY OCSF07511102: LIQUID OPER-PIMCO B LEHMAN CAT 1 REPO REPO 02.920% 5/23/2005 100.0000 14,700,000.000 14,700,000.00 -14,700,000.00 0.00 05/24/2005 DD 05/23 /05 5/23/2005 SEC ID: 99435T087 5/23/2005 BROKER: LEHMAN GOVT SECS INC, NY OCSF07511102 : LIQUID OPER-PIMCO B LEHMAN CAT 2 REPO 02.890% 05/25/2005 DD 5/24/2005 100.0000 10,300,000.000 10,300,000.00 -10,300,000.00 0.00 05/24/05 5/24/2005 SEC ID: 99435U803 5/24/2005 BROKER: LEHMAN GOVT SECS INC, NY OCSF07511102: LIQUID OPER-PIMCO B LEHMAN CAT 1 REPO REPO 02.900% 5/25/2005 100.0000 14,600,000.000 14,600,000.00 -14,600,000.00 0.00 05/26/2005 DD 05/25/05 5/25/2005 SEC ID: 99435W163 5/25/2005 BROKER: LEHMAN GOVT SECS INC, NY OCSF07511102: LIQUID OPER-PIMCO B LEHMAN CAT 1 REPO REPO 02 .910% 5/26/2005 100.0000 14,700,000.000 14,700,000.00 -14,700,000.00 0.00 05/27/2005 DD 05/26/05 5/26/2005 SEC ID: 99435X633 5/26/2005 BROKER: LEHMAN GOVT SECS INC, NY OCSF07511102: LIQUID OPER-PIMCO 6/7/2005 11:00:17AM PDT Workbench * Actual Settle Date 7 @ Mellon Transaction Detail Report ID: EWBA09 Reported by Transaction Category Base Currency: USD OCSD-CONSOLIDATEDID2 :::J 60••:::J•D•DD 5/2/2005-5/31/2005 Status: FINAL Trade Date 'II" Jllo -., '-i ~ ; l~•r,/l ~~ a. -,-,u· t' ·'-· ' ~ .... 1 Tran ~ " , • "I Cost Amount · 1 Net Gain/Loss ,. ..... Settle Date Base Price ' -~ ~ =-'.1...•.1 ~ j•~}:_r H Type Description . Reported Date Shares/Par Base Base .Base -~ ., .. .I ~- B DREYFUS TREASURY CASH MGMT 5/9/2005 1.0000 27,232.080 27,232.08 -27,232.08 0.00 SEC ID: 996085247 5/9/2005 OCSF07511102: LIQUID OPER-PIMCO 5/9/2005 B DREYFUS TREASURY CASH MGMT 5/9/2005 1.0000 4,547.650 4,547.65 -4,547.65 0.00 SEC ID: 996085247 5/9/2005 OCSF07522202: LONG TERM OPER-PIMCO 5/9/2005 B DREYFUS TREASURY CASH MGMT 5/10/2005 1.0000 1,543.830 1,543.83 -1,543.83 0.00 SEC ID: 996085247 5/10/2005 OCSF07511102: LIQUID OPER-PIMCO 5/10/2005 B DREYFUS TREASURY CASH MGMT 5/10/2005 1.0000 72,673.280 72,673.28 -72,673.28 0.00 SEC ID: 996085247 5/10/2005 OCSF07522202: LONG TERM OPER-PIMCO 5/10/2005 B DREYFUS TREASURY CASH MGMT 5/11/2005 1.0000 20,891.830 20,891.83 -20,891.83 0.00 SEC ID: 996085247 5/11/2005 OCSF07511102: LIQUID OPER-PIMCO 5/11/2005 B DREYFUS TREASURY CASH MGMT 5/16/2005 1.0000 180,685.720 180,685.72 -180,685.72 0.00 SEC ID: 996085247 5/16/2005 OCSF07511102: LIQUID OPER-PIMCO 5/16/2005 B DREYFUS TREASURY CASH MGMT 5/16/2005 1.0000 47,791.770 47,791.77 -47,791.77 0.00 SEC ID: 996085247 5/16/2005 OCSF07522202: LONG TERM OPER-PIMCO 5/16/2005 B DREYFUS TREASURY CASH MGMT 5/17/2005 1.0000 1,093.230 1,093.23 -1,093.23 0.00 SEC ID: 996085247 5/17/2005 OCSF07511102: LIQUID OPER-PIMCO 5/17/2005 6/7/2005 l l :00:l 7AM PDT Workbench * Actual Settle Date 9 @ Transaction Detail ReportID: EWBA09 Mellon Reported by Transaction Category Base Currency: USD OCSD-CONSOLIDATEDJ3I.2 :J 6000::JDO:JO• 5/2/2005-5/31/2005 Status: FINAL T,. ':J..,. .. ,. "' . ;t '.I-Trade Date •. ----·.1: ·. n.•-;-::\:~:--',•·;~i-~ r . 'f ... ' 1,, 11 t I a 1 Net Gain/Losa Tran ' ~1,:· -~ ~ .. -.. /··~. Settle Date Base Price Cost '• Amount ' Type Description ' Reported Date Shares/Par . ' .. Base ~ I•'.• Base Base ·-,. ~i '"'•"I.; ..... -. " -,•· .. ~~ ,. B HOUSEHOLD FIN CORP NT 7.200% 07/15/2006 5/19/2005 103.6600 2,500,000.000 2,591,500.00 -2,591,500.00 0.00 DD 07 /15/99 5/24/2005 SEC ID: 441812GH1 5/19/2005 BROKER: JP MORGAN CHASE BANK/HSBC!, NEW YORK OCSF07522202: LONG TERM OPER-PIMCO 18 HOUSEHOLD FlN CORP NT 7.200%07 /15/2006 5/19/2005 103.6600 0.000 0.00 -64,500.00 0.00 DD 07 /15/99 5/24/2005 SEC ID: 441812GH1 5/19/2005 BROKER: JP MORGAN CHASE BANK/HSBC!, NEW YORK OCSF07522202: LONG TERM OPER-PIMCO B US TREASURY NOTES 3.500% 12/15/2009 DD 5/13/2005 98.6602 13,920,000.000 13,733,493.75 -13,733,493.75 0.00 12/15/04 5/16/2005 SEC ID: 912828DE7 5/13/2005 BROKER: BANC OF AMERICA SEC LLC, SAN FRANCISCO OCSF07522202: LONG TERM OPER-PIMCO 18 US TREASURY NOTES 3.500% 12/15/2009 DD 5/13/2005 98.6602 0.000 0.00 -203,446.15 0.00 12/ 15/04 5/16/2005 SEC ID: 91'.;l828DE7 5/13/2005 BROKER: BANC OF AMERICA SEC LLC, SAN FRANCISCO OCSF07522202: LONG TERM OPER-PIMCO B US TREASURY NOTES 4.000%03/15/2010 DD 5/13/2005 100.6792 20,700,000.000 20,840,596.4 7 -20,840,596.47 0.00 03/15/05 6/15/2005 SEC ID: 912828DP2 5/13/2005 BROKER: CREDIT SUISSE, NEW YORK OCSF07522202: LONG TERM OPER-PIMCO 18 US TREASURY NOTES 4.000% 03/15/2010 DD 5/13/2005 100.6792 0.000 0.00 -207,000.00 0.00 03/15/05 6/15/2005 SEC ID: 912828DP2 5/13/2005 BROKER: CREDIT SUISSE, NEW YORK OCSF07522202: LONG TERM OPER-PIMCO 6/7/2005 11:00:17AM PDT Workbench * Actual Settle Date 13 @ Transaction Detail Report ID: EWBA09 Mellon Reported by Transaction Category Base Currency: USD OCSD-CONSOLIDATEDJl.lll!J2 J 6 0 ••::J••J D• 5/2/2005-5/31/2005 Status: FINAL .L'j -• ~ I• ••• [1 u-,t·' .... ~ ':'".,,.. ti. . . -Trade Date .. ·-. ".V . , -n. l. ~ . .,• ~ ~ 1 ._~ ·--1),. li-.1. ~ l . Net Gain/Loss Tran . I', •• "!:.. : ' Settle Date Base Price . C ... Cost • J;j_, .. Amount .. I',,-.-' ' . . ' Type Description ,'11 Reported Date Shares/Par . Base • I Base Base ,, ' ·.J!". 8 UNITED STATES TREASURY NT 3.750% 5/19/2005 100.1503 6,000,000.000 6,009,015.54 -6,009,015.54 0.00 03/31/2007 DD 03/31 /05 6/22/2005 SEC ID: 912828DQO 5/19/2005 BROKER: GOLDMAN SACHS & CO, NY OCSF07522202: LONG TERM OPER-PIMCO IB UNITED STATES TREASURY NT 3.750% 5/19/2005 100.1503 0.000 0.00 -51,024.59 0.00 03/31/2007 DD 03/31 /05 6/22/2005 SEC ID: 912828DQO 5/19/2005 BROKER: GOLDMAN SACHS & CO, NY OCSF07522202: LONG TERM OPER-PIMCO 8 UNITED STATES TREASURY NTS 4.000% 5/13/2005 100.6598 10,000,000.000 10,065,983.50 -10,065,983.50 0.00 04/15/2010 DD 04/15/05 6/15/2005 SEC ID: 912828DR8 5/13/2005 BROKER: CREDIT SUISSE, NEW YORK OCSF07522202: LONG TERM OPER-PIMCO 18 UNITED STATES TREASURY NTS 4 .000% 5/13/2005 100.6598 0.000 0 .00 -66,666.67 0.00 04/15/2010 DD 04/ 15 /05 6/15/2005 SEC ID: 912828DR8 5/13/2005 BROKER: CREDIT SUISSE, NEW YORK OCSF07522202: LONG TERM OPER-PIMCO TOTAL FIXED INCOME SECURITIES U.S. DOLLAR: 97,420,000.710 97,777,218.03 -98,652,464.05 0.00 TOTAL FIXED INCOME SECURITIES BASE: 97,420,000.710 97,777,218.03 -98,652,464.05 0.00 TOTAL PURCHASES BASE: 489,242,082.400 489,443,198.40 -490,318,444.42 0.00 SALES CASH & CASH EQUIVALENTS U.S. DOLLAR s FEDERAL HOME LN BK CONS DISC N MAT 5/25/2005 99.7944 -3, 100,000.000 -3,093,627.78 3,093,627.78 0.00 06/17/2005 5/25/2005 SEC ID: 313385GZ3 5/25/2005 BROKER: BARCLAYS CAPITAL INC, NEW YORK OCSF07522202: LONG TERM OPER-PIMCO 6/7/2005 11:00:17AM PDT Workbench * Actual Settle Date 15 Transaction Detail . @ Report ID: EWBA09 Mellon Reported by Transaction Category Base Currency: USD OCSD-CONSOLI DAT E Dcm:2 '.J 60 ••CJ D•••• 5/2/2005 -5/31/2005 Status: FINAL I ·-,:_,i?;,.;~-~• . Trade Date ....... u . ...i";.""''",, .. n" Tran •' -,~ :,,~ Settle Date Base Price l"~ 1:~· ;·_ . ~ ~ }·; ~: Cost \ Amounf ··, Net Gain/Loss J ._.. I •· ~-Type Description 'ii: I~ •' ~, 'I ' ~-._.: ,. Reported Date Shares/Par Base ::,_:I ,r I 1E Base ' Base -;'~-~ y " MT FEDERAL HOME LN BK CONS DISC N MAT 5/9/2005 100.0000 -4,000,000.000 -3,999,033.33 3,999,033.33 0.00 05/09/2005 5/9/2005 SEC ID: 313385FJO 5/9/2005 OCSF07511102: LIQUID OPER-PIMCO MT FEDERAL HOME LN BK CONS DISC MAT 5/10/2005 100.0000 -2,400,000.000 -2,399,806.67 2,399,806.67 0.00 05/10/2005 5/10/2005 SEC ID: 313385FK7 5/10/2005 OCSF07511102 : LIQUID OPER-PIMCO MT FEDERAL HOME LN BK CONS DISC N MAT 5/11/2005 100.0000 -4,500,000.000 -4,499,636.25 4 ,499,636.25 0.00 05/11/2005 5/11/2005 SEC ID: 313385FL5 5/11/2005 OCSF07511102 : LIQUID OPER-PIMCO MT FEDERAL HOME LN BK CONS DISC MAT 5/12/2005 100.0000 -3,300,000.000 -3,299,736.00 3,299,736.00 0.00 5/12/2005 5/12/2005 SEC ID: 313385FM3 5/12/2005 OCSF07511102: LIQUID OPER-PIMCO MT FEDERAL HOME LN BKS CONS DISC MAT 5/13/2005 100.0000 -4,000,000.000 -3,999,677.78 3,999,677.78 0.00 05/13/2005 5/13/2005 SEC ID: 313385FN1 5/13/2005 OCSF07511102: LIQUID OPER-PIMCO MT FEDERAL HOME LN BK CONS DISC N MAT 5/16/2005 100.0000 -1,500,000.000 -1,499,637.50 1,499,637.50 0.00 05/16/2005 5/16/2005 SEC ID: 313385FR2 5/16/2005 OCSF07511102: LIQUID OPER-PIMCO MT FEDERAL HOME LN BK CONS DISC N MAT 5/19/2005 100.0000 -200,000.000 -199,983.89 199,983.89 0.00 05/19/2005 5/19/2005 SEC ID: 313385FU5 5/19/2005 OCSF07511102 : LIQUID OPER-PIMCO MT FEDERAL HOME LN BKS CONS DISC MAT 5/20/2005 100.0000 -2,300,000.000 -2,290, 158.33 2,290,158.33 0.00 05/20/2005 5/20/2005 SEC ID: 313385FV3 5/20/2005 OCSF07511102 : LIQUID OPER-PIMCO 6/7/2005 11 :00:17AM PDT Workbench * Actual Settle Date 31 @ Transaction Detail Report ID: EWBA09 Mellon Reported by Transaction Category Base Currency: USD OCSD-CONSOLIDATEDJDIJI2 • 6 D •••••,J D• 5/2/2005 -5/31/2005 Status: FINAL Trade Date 11 r·1 -"• jt. • 'l ~ IJ ' ~, .. ~ " •., ~ ~' -U -~ .. -~ ·• -fl ' -•fl"' ,. I. '. ,jlri , .. 1: r .. ,. t, Tran ,, -.. ,. ,,,J.1 Settle Date~ I• • r-• ~ • ;. fj~!IJI,:~ Cost -°i'":..' 1: Amount Net Gain/Lou ~ tL~•,,. Base Price ~ Type Description . · :. 1 ~ :. ... ,.c~ , ~ Reported Date Shares/Par ... :::, _.'.. Base . Base Bae ~ MT FEDERAL HOME LN BK CONS DISC N MAT 5/23/2005 100.0000 -2,900,000.000 -2,899,296.75 2,899,296.75 0.00 05/23/2005 5/23/2005 SEC ID: 313385FY7 5/23/2005 OCSF07511102 : LIQUID OPER·PIMCO MT FEDERAL HOME LN BK CONS DISC N MAT 5/24/2005 100.0000 -1,500,000.000 -1,499,879.17 1,499,879.17 0.00 05/24/2005 5/24/2005 SEC ID: 313385FZ4 5/24/2005 OCSF07511102: LIQUID OPER·PIMCO MT FEDERAL HOME LN BK CONS DISC N MAT 5/25/2005 100.0000 -6,000,000.000 •5,986,536.67 5,986,536.67 0.00 05/25/2005 5/25/2005 SEC ID: 313385GA8 5/25/2005 OCSF07511102: LIQUID OPER-PIMCO MT FEDERAL HOME LN BK CONS DISC MAT 5/26/2005 100.0000 -1,800,000.000 -1,799,853.50 1,799,853.50 0.00 05/26/2005 5/26/2005 SEC ID: 313385GB6 5/26/2005 OCSF07511102: LIQUID OPER-PIMCO MT FEDERAL HOME LN BK CONS DISC MAT 5/27/2005 100.0000 -1,700,000.000 -1,699,861.64 1,699,861.64 0.00 05/27/2005 5/27/2005 SEC ID: 313385GC4 5/27/2005 OCSF07511102: LIQUID OPER-PIMCO MT FEDERAL HOME LN BK CONS DISC MAT 5/31/2005 100.0000 -1,700,000.000 -1,699,448.44 1,699,448.44 0.00 05/31/2005 5/31/2005 SEC ID: 313385GG5 5/31/2005 OCSF07511102: LIQUID OPER-PIMCO MT FEDERAL HOME LN MTG CORP DISC MAT 5/10/2005 100.0000 -2,000,000.000 ·1,987,117.78 1,987,117.78 0.00 05/10/2005 5/10/2005 SEC ID: 313397FK2 5/10/2005 OCSF0751 ll02: LIQUID OPER-PIMCO MT FEDERAL HOME LN MTG CORP DISC MAT 5/17/2005 100.0000 -2,000,000.000 -1,986,748.89 1,986,748.89 0.00 05/17/2005 5/17/2005 SEC ID: 313397FSS 5/17/2005 OCSF07511102: LIQUID OPER-PIMCO 6/7/2005 11 :00:17AM PDT Workbench * Actual Settle Date 32 Q. Transaction Detail Report ID: EWBA09 V(!/ Mellon Reported by Transaction Category Base Currency: USD OCSD-CONSOLIDATEDJI:n:[2J6D•••••••• 5/2/2005 -5/31/2005 Status: FINAL l ·• . . T ' ' •• -.• ,-• •r.: ·• • ~ -~ . ~-.. •. . ,_ - ,1 i-: •1 • ,, _ • Trade Date .;; . ·, ··~--..,,.1,.,. 1:i· · ., · ~. ·," ·· Tran . . . ~ . -~.:;.)' ··~ ' Settle Date Base Price . "'• . ,-; '".,,_rill: • i•= Cost i • ·-"'1 Amount , Met Gain/Loses lo.(.., ~• ,, ,, _ , 4, f ., lft Type Description Reported Date Shares/Par -:~ c;.•,'-< Base J . i Base Bu:e --, --• • J; -•," '"'-· t. r IT FNMA POOL #0323980 6.000%04/01/2014 5/25/2005 3,342.540 648.57 648.57 0.00 DD 09/01/99 5/1/2005 SEC ID: 31374T2MO 5/25/2005 OCSF07522202: LONG TERM OPER-PIMCO 5/25/2005 * IT FNMA POOL #0357328 5.000% 01/01/2018 5/25/2005 372.140 91.92 91.92 0.00 DD 01/01/03 5/1/2005 SEC ID: 31376J4M8 5/25/2005 OCSF07522202: LONG TERM OPER-PIMCO 5/25/2005 * IT FNMA POOL #0357430 5.000% 09/01/2018 5/25/2005 21,137.580 4,864.88 4,864.88 0.00 DD 09/01/03 5/1/2005 SEC ID: 31376KA71 5/25/2005 OCSF07522202: LONG TERM OPER-PIMCO 5/25/2005 * IT FNMA POOL #0456482 6.000% 02/01/2014 5/25/2005 358.960 180.64 180.64 0.00 DD 02/01/99 5/1/2005 SEC ID: 31381 CCT2 5/25/2005 OCSF07522202: LONG TERM OPER-PIMCO 5/25/2005 * IT FNMA POOL #0509649 6.000% 09/01/2014 5/25/2005 828.190 481.89 481.89 0.00 DD 09/01/99 5/1/2005 SEC ID: 31383QEWO 5/25/2005 OCSF07522202: LONG TERM OPER-PIMCO 5/25/2005 * IT FNMA POOL #0535451 6.000% 06/01/2015 5/25/2005 2,926.160 503.81 503.81 0.00 DD 07 /01/00 5/1/2005 SEC ID: 31384 VZQ8 5/25/2005 OCSF07522202: LONG TERM OPER-PIMCO 5/25/2005 * IT FNMA POOL #0555363 5.000% 04/01/2018 5/25/2005 4,403.470 1,173.26 1,173.26 0.00 DD 03/01/03 5/1/2005 SEC ID: 31385W5Yl 5/25/2005 OCSF07522202: LONG TERM OPER-PIMCO 5/25/2005 * IT FNMA POOL #0555453 5.000% 05/01/2018 5/25/2005 502.010 122.05 122.05 0.00 DD 04/01/03 5/1/2005 SEC ID: 31385XBW6 5/25/2005 OCSF07522202: LONG TERM OPER-PIMCO 5/25/2005 * 6/7/2005 ll:00:17AM PDT Workbench * Actual Settle Date 40 . ~ @ Transaction Detail ReportID: EWBA09 Mellon Reported by Transaction Category Base Currency: USD OCSD-CONSOLIDATE DJI]]J[J2 u 6• ••o•oo•• 5/2/2005-5/31/2005 Status: FINAL -. . . .. _j -Trade Date .... !J"l' ~ -. ,,. ,11. ~ . . . -t' ~ ' ~ r .-:r I t-• Tran ,. Cost ' . ' Amount I Net Gain/Losa ,c Settle Date Base Price ;,-~ I. I Type Description , Reported Date Shares/Par •' Base Base Base . . " .. ; L -r' ~ : .. . \., -·~ JI': 'II I""' I •. IT FNMA POOL #0738211 5.000% 10/01/2018 5/25/2005 17,259.290 1,947.73 1,947.73 0.00 DD 10/01/03 5/1/2005 SEC ID: 31402UDQ2 5/25/2005 OCSF07522202: LONG TERM OPER-PIMCO 5/25/2005"' IT FNMA POOL #0738487 5.000% 10/01/2018 5/25/2005 723.630 672.09 672.09 0.00 DD 10/01/03 5/1/2005 SEC ID: 31402UNC2 5/25/2005 OCSF07522202: LONG TERM OPER-PIMCO 5/25/2005"' IT FNMA POOL #0740457 5.000% 10/01/2018 5/25/2005 15,959.310 8,119.34 8,119.34 0.00 DD 10/01/03 5/1/2005 SEC ID: 31402WI'N8 5/25/2005 OCSF07522202: LONG TERM OPER-PIMCO 5/25/2005 * IT FNMA POOL#0740471 5.000% 10/01/2018 5/25/2005 4,278.510 2,722.45 2,722.45 0.00 DD 10/01/03 5/1/2005 SEC ID: 31402WI'40 5/25/2005 OCSF07522202: LONG TERM OPER-PIMCO 5/25/2005 * IT FNMA POOL#0740748 5.000% 10/01/2018 5/25/2005 8,920.560 2,833.06 2,833.06 0.00 DD 11/01/03 5/1/2005 SEC ID: 31402W5H7 5/25/2005 OCSF07522202: LONG TERM OPER-PIMCO 5/25/2005 * IT FNMA POOL #0743868 5.000% 11/01/2018 5/25/2005 736.840 137.89 137.89 0.00 DD 10/01/03 5/1/2005 SEC ID: 31403BMR1 5/25/2005 OCSF07522202: LONG TERM OPER-PIMCO 5/25/2005 * IT FNMA POOL #0744008 5.000% 07/01/2018 5/25/2005 4,633.900 3,671.22 3,671.22 0.00 DD 09/01/03 5/1/2005 SEC ID: 31403BR54 5/25/2005 OCSF07522202 : LONG TERM OPER-PIMCO 5/25/2005 * IT FNMA POOL #0744316 5.000% 09 /01/2018 5/25/2005 1,633.490 578.44 578.44 0.00 DD 09/01/03 5/1/2005 SEC ID: 31403B3Z4 5/25/2005 OCSF07522202: LONG TERM OPER-PIMCO 5/25/2005 * 6/7/2005 11 :00:17AM PDT Workbench * Actual Settle Date 45 - @ Transaction Detail Report ID: EWBA09 M,ellon Reported by Transaction Category Base Currency: USD OCSD-CONSOLIDATEDOIIDI2 J 6• •••••••• 5/2/2005 -5/31/2005 Status: FINAL -" -;-:r . .. ' i(' • " Trade Date ·-: J:. '._ ' ;. ""' ·, " I' • ~ " . L• Amount Net Gain/Loss Tran . ,i, C°" • I Cost ' . , . - '. ' ~'·· 1, . Settle Date Base Price :: _ .. !":-I Type Description -' Reported Date . Shar~a/Par Base a Base _ Base '· . -., -, . ,, ,. , __ ' *'--' IT GNMA POOL#0468052 6.500% 07/15/2028 5/16/2005 220.240 595.89 595.89 0.00 DD 07 /01/98 5/1/2005 SEC ID: 36209C5M4 5/16/2005 OCSF07522202: LONG TERM OPER-PIMCO 5/16/2005 .. IT GNMA POOL#0476041 6.500% 06/15/2028 5/16/2005 244.080 661.21 661.21 0.00 DD 06/01/98 5/1/2005 SEC ID: 36209MZE7 5/16/2005 OCSF07522202: LONG TERM OPER-PIMCO 5/16/2005 * IT GNMA POOL#0478626 6.500% 01/15/2029 5/16/2005 185.940 649.34 649.34 0.00 DD 01/01/99 5/1/2005 SEC ID: 36209QVT9 5/16/2005 OCSF07522202: LONG TERM OPER-PIMCO 5/16/2005 * IT GNMA POOL #0480598 6.500% 10/15/2028 5/16/2005 40.170 155.00 155.00 0.00 DD 10/01/98 5/1/2005 SEC ID: 36209S3F6 5/16/2005 OCSF07522202: LONG TERM OPER-PIMCO 5/16/2005 * IT GNMA POOL#0512235 6.500% 11/15/2029 5/16/2005 13.530 45.16 45.16 0.00 DD 11/01/99 5/1/2005 SEC ID: 36211GBC6 5/16/2005 OCSF07522202: LONG TERM OPER-PIMCO 5/16/2005 * IT GNMA POOL #0514326 6.500% 07/15/2029 5/16/2005 328.860 422.22 422.22 0.00 DD 07 /01/99 5/1/2005 SEC ID: 36211JLF2 5/16/2005 OCSF07522202: LONG TERM OPER-PIMCO 5/16/2005 * IT GNMA II POOL #0080023 VAR RT 12/20/2026 5/20/2005 5,325.050 501.43 501.43 0.00 DD 12/01/96 5/1/2005 SEC ID: 36225CAZ9 5/20/2005 OCSF07522202: LONG TERM OPER-PIMCO 5/20/2005 * IT GNMA II POOL #080088M 7.375% 06/20/2027 5/20/2005 1,896.880 500.11 500.11 0.00 DD 06/01/97 5/1/2005 SEC ID: 36225CC20 5/20/2005 OCSF07522202: LONG TERM OPER-PIMCO 5/20/2005 * 6/7/2005 l 1:00:17AM PDT Workbench * Actual Settle Date 49