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Home My WebLink About12-10-2025 Administration Committee Complete Agenda Packet SPECIAL NOTICE PUBLIC ATTENDANCE & PARTICIPATION AT PUBLIC MEETINGS Administration Committee Meeting Wednesday, December 10, 2025 5:00 p.m. Your participation is always welcome. OC San offers several ways in which to interact during meetings. You will find information as to these opportunities below. IN-PERSON MEETING ATTENDANCE You may attend the meeting in-person at the following location: Orange County Sanitation District Headquarters 18480 Bandilier Circle Fountain Valley, CA 92708 ONLINE MEETING PARTICIPATION You may join the meeting live via Teams on your computer or similar device or web browser by using the link below: Click here to join the meeting We suggest testing joining a Teams meeting on your device prior to the commencement of the meeting. For recommendations, general guidance on using Teams, and instructions on joining a Teams meeting, please click here. Please mute yourself upon entry to the meeting. Please raise your hand if you wish to speak during the public comment section of the meeting. The Clerk of the Board will call upon you by using the name you joined with. Meeting attendees are not provided the ability to make a presentation during the meeting. Please contact the Clerk of the Board at least 48 hours prior to the meeting if you wish to present any items. Additionally, camera feeds may be controlled by the meeting moderator to avoid inappropriate content. HOW TO PARTICIPATE IN THE MEETING BY TELEPHONE To join the meeting from your phone: Dial (213) 279-1455 When prompted, enter the Phone Conference ID: 837 038 149# All meeting participants may be muted during the meeting to alleviate background noise. If you are muted, please use *6 to unmute. You may also mute yourself on your device. Please raise your hand to speak by using *5, during the public comment section of the meeting. The Clerk of the Board will call upon you by using the last 4 digits of your phone number as identification. NOTE: All attendees will be disconnected from the meeting at the beginning of Closed Session. If you would like to return to the Open Session portion of the meeting, please login or dial-in to the Teams meeting again and wait in the Lobby for admittance. WATCH THE MEETING ONLINE The meeting will be available for online viewing at: https://ocsd.legistar.com/Calendar.aspx SUBMIT A COMMENT You may submit your comments and questions in writing for consideration in advance of the meeting by using the eComment feature available online at: https://ocsd.legistar.com/Calendar.aspx or sending them to OCSanClerk@ocsan.gov with the subject line “PUBLIC COMMENT ITEM # (insert the item number relevant to your comment)” or “PUBLIC COMMENT NON-AGENDA ITEM”. You may also submit comments and questions for consideration during the meeting by using the eComment feature available online at: https://ocsd.legistar.com/Calendar.aspx. The eComment feature will be available for the duration of the meeting. All written public comments will be provided to the legislative body and may be read into the record or compiled as part of the record. For any questions and/or concerns, please contact the Clerk of the Board’s office at 714-593-7433. Thank you for your interest in OC San! December 3, 2025 NOTICE OF REGULAR MEETING ADMINISTRATION COMMITTEE ORANGE COUNTY SANITATION DISTRICT Wednesday, December 10, 2025 – 5:00 P.M. Headquarters 18480 Bandilier Circle Fountain Valley, CA 92708 ACCESSIBILITY FOR THE GENERAL PUBLIC Your participation is always welcome. Specific information as to how to participate in this meeting is detailed on the Special Notice attached to this agenda. In general, OC San offers several ways in which to interact during this meeting: you may participate in person, join the meeting live via Teams on your computer or similar device or web browser, join the meeting live via telephone, view the meeting online, and/or submit comments for consideration before or during the meeting. The Regular Meeting of the Administration Committee of the Orange County Sanitation District will be held at the above location and in the manner indicated on Wednesday, December 10, 2025 at 5:00 p.m. ADMINISTRATION COMMITTEE MEETING DATE BOARD MEETING DATE 12/10/25 12/17/25 * JANUARY DARK 01/28/26 02/11/26 02/25/26 03/11/26 03/25/26 04/08/26 04/22/26 05/13/26 05/27/26 06/10/26 06/24/26 07/08/26 07/22/26 AUGUST DARK 08/26/26 09/09/26 09/23/26 10/14/26 10/28/26 11/12/25 11/18/26 * * Meeting will be held on the third Wednesday of the month ROLL CALL ADMINISTRATION COMMITTEE Finance, Information Technology, Environmental Services and Human Resources Meeting Date: December 10, 2025 Time: 5:00 p.m. COMMITTEE MEMBERS (13) Christine Marick, Chair Glenn Grandis, Vice-Chair Melinda Liu Jose Medrano Jordan Nefulda Andrew Nguyen David Shawver Chad Wanke Erik Weigand John Withers Jordan Wu Ryan Gallagher (Board Chair) Jon Dumitru (Board Vice-Chair) OTHERS Scott Smith, General Counsel STAFF Rob Thompson, General Manager Lorenzo Tyner, Assistant General Manager Jennifer Cabral, Director of Communications Mike Dorman, Director of Engineering Laura Maravilla, Director of Human Resources Riaz Moinuddin, Director of Operations & Maintenance Wally Ritchie, Director of Finance Lan Wiborg, Director of Environmental Services Kelly Lore, Clerk of the Board ORANGE COUNTY SANITATION DISTRICT Effective 10/1/2025 BOARD OF DIRECTORS Complete Roster AGENCY/CITIES ACTIVE DIRECTOR ALTERNATE DIRECTOR Anaheim Carlos A. Leon Ryan Balius Brea Christine Marick Cecilia Hupp Buena Park Joyce Ahn Lamiya Hoque Cypress VACANT Bonnie Peat Fountain Valley Glenn Grandis Ted Bui Fullerton Jamie Valencia Shana Charles Garden Grove Stephanie Klopfenstein Cindy Ngoc Tran Huntington Beach Pat Burns Gracey Van Der Mark Irvine Melinda Liu Kathleen Treseder La Habra Jose Medrano Rose Espinoza La Palma Debbie Baker Vikesh Patel Los Alamitos Jordan Nefulda Tanya Doby Newport Beach Erik Weigand Michelle Barto Orange Jon Dumitru John Gyllenhammer Placentia Chad Wanke Ward Smith Santa Ana Johnathan Ryan Hernandez Jessie Lopez Seal Beach Lisa Landau Ben Wong Stanton David Shawver John D. Warren Tustin Ryan Gallagher Austin Lumbard Villa Park Jordan Wu Kelly McBride Sanitary/Water Districts Costa Mesa Sanitary District Bob Ooten Art Perry Midway City Sanitary District Andrew Nguyen Tyler Diep Irvine Ranch Water District John Withers Dan Ferons Yorba Linda Water District Tom Lindsey Gene Hernandez County Areas Board of Supervisors Doug Chaffee Janet Nguyen ADMINISTRATION COMMITTEE Regular Meeting Agenda Wednesday, December 10, 2025 - 5:00 PM Board Room Headquarters 18480 Bandilier Circle Fountain Valley, CA 92708 (714) 593-7433 ACCOMMODATIONS FOR THE DISABLED: If you require any special disability related accommodations, please contact the Orange County Sanitation District (OC San) Clerk of the Board’s office at (714) 593-7433 at least 72 hours prior to the scheduled meeting. Requests must specify the nature of the disability and the type of accommodation requested. AGENDA POSTING: In accordance with the requirements of California Government Code Section 54954.2, this agenda has been posted outside OC San's Headquarters located at 18480 Bandilier Circle, Fountain Valley, California, and on the OC San’s website at www.ocsan.gov not less than 72 hours prior to the meeting date and time above. All public records relating to each agenda item, including those distributed less than 72 hours prior to the meeting to a majority of the Board of Directors, are available for public inspection with the Clerk of the Board. AGENDA DESCRIPTION: The agenda provides a brief general description of each item of business to be considered or discussed. The recommended action does not indicate what action will be taken. The Board of Directors may take any action which is deemed appropriate. MEETING RECORDING: A recording of this meeting is available within 24 hours after adjournment of the meeting at https://ocsd.legistar.com/Calendar.aspx or by contacting the Clerk of the Board. NOTICE TO DIRECTORS: To place items on the agenda for a Committee or Board Meeting, the item must be submitted to the Clerk of the Board: Kelly A. Lore, MMC, (714) 593-7433 / klore@ocsan.gov at least 14 days before the meeting. For any questions on the agenda, Board members may contact staff at: General Manager: Rob Thompson, rthompson@ocsan.gov / (714) 593-7110 Asst. General Manager: Lorenzo Tyner, ltyner@ocsan.gov / (714) 593-7550 Director of Communications: Jennifer Cabral, jcabral@ocsan.gov / (714) 593-7581 Director of Engineering: Mike Dorman, mdorman@ocsan.gov / (714) 593-7014 Director of Environmental Services: Lan Wiborg, lwiborg@ocsan.gov / (714) 593-7450 Director of Finance: Wally Ritchie, writchie@ocsan.gov / (714) 593-7570 Director of Human Resources: Laura Maravilla, lmaravilla@ocsan.gov / (714) 593-7007 Director of Operations & Maintenance: Riaz Moinuddin, rmoinuddin@ocsan.gov / (714) 593-7269 ADMINISTRATION COMMITTEE Regular Meeting Agenda Wednesday, December 10, 2025 CALL TO ORDER PLEDGE OF ALLEGIANCE ROLL CALL AND DECLARATION OF QUORUM: Clerk of the Board PUBLIC COMMENTS: Your participation is always welcome. Specific information as to how to participate in a meeting is detailed in the Special Notice attached to this agenda. In general, OC San offers several ways in which to interact during meetings: you may participate in person, join the meeting live via Teams on your computer or similar device or web browser, join the meeting live via telephone, view the meeting online, and/or submit comments for consideration before or during the meeting. REPORTS: The Chairperson and the General Manager may present verbal reports on miscellaneous matters of general interest to the Directors. These reports are for information only and require no action by the Directors. CONSENT CALENDAR: Consent Calendar Items are considered to be routine and will be enacted, by the Committee, after one motion, without discussion. Any items withdrawn from the Consent Calendar for separate discussion will be considered in the regular order of business. 1.2025-4620APPROVAL OF MINUTES RECOMMENDATION: Approve minutes of the Regular meeting of the Administration Committee held November 12, 2025. Originator:Kelly Lore 11-12-2025 Administration Committee Meeting MinutesAttachments: 2.2025-4558PAYMENT OF ANNUAL NATIONAL POLLUTANT DISCHARGE ELIMINATION SYSTEM PERMIT FEES RECOMMENDATION: Recommend to the Board of Directors to: Approve payment to the State Water Resources Control Board in an amount not to exceed $950,000 for the annual National Pollutant Discharge Elimination System ocean discharge permit fees for Fiscal Year 2025-2026. Originator:Lan Wiborg Page 1 of 5 ADMINISTRATION COMMITTEE Regular Meeting Agenda Wednesday, December 10, 2025 Agenda ReportAttachments: 3.2025-4627IBM MAXIMO EMERGENCY AND LEVEL 3 SUPPORT RECOMMENDATION: A. Approve a Sole Source Purchase Order Agreement with Total Resource Management, Inc. to provide Emergency and Level 3 support for IBM Maximo software, for a total amount not to exceed $160,000 for the period of January 1, 2026, through December 31, 2026, with four (4) optional one-year renewals; and B. Approve an annual contingency of $16,000 (10%). Originator:Wally Ritchie Agenda ReportAttachments: 4.2025-4630COOPERATIVE PROCUREMENT AGREEMENT RECOMMENDATION: Recommend to the Board of Directors to: Approve a Blanket Purchase Order with Insight Public Sector Inc. for the purchase of technology products, equipment, services and solutions using the cooperative OMNIA Contract No. 23-6692-03 for a total amount not to exceed $1,200,000; for the term January 1, 2026, through December 31, 2026, in accordance with Ordinance No. OC SAN-61, Section 2.03(B) Cooperative Purchases; with two (2) optional one-year renewal options. Originator:Wally Ritchie Agenda ReportAttachments: NON-CONSENT: 5.2025-4574ORANGE COUNTY EMPLOYEES RETIREMENT SYSTEM PREPAYMENT RECOMMENDATION: Recommend to the Board of Directors to: Approve prepayments of Orange County Employees Retirement System contributions in the amount of $10.3 million, using funds from OC San’s 115 Trust. Originator:Wally Ritchie Agenda ReportAttachments: Page 2 of 5 ADMINISTRATION COMMITTEE Regular Meeting Agenda Wednesday, December 10, 2025 6.2025-4626LEGISLATIVE AFFAIRS UPDATE FOR THE MONTH OF NOVEMBER 2025 RECOMMENDATION: Recommend to the Board of Directors to: Receive and file the Legislative Affairs Update for the month of November 2025. Originator:Jennifer Cabral Agenda Report Federal Legislative Update Federal Matrix State Legislative Update Local Legislative Update Presentation Attachments: 7.2025-4633PUBLIC AFFAIRS STRATEGIC PLAN FOR FISCAL YEARS 2024-2026 MID-YEAR UPDATE RECOMMENDATION: Receive and file the Public Affairs Strategic Plan for Fiscal Years 2024- 2026 Mid-Year Update. Originator:Jennifer Cabral Agenda Report Public Affairs Strategic Plan for FY 2024-26 Presentation Attachments: 8.2025-4583ADDITIONAL POSITION REQUESTS FOR FISCAL YEAR 2025-26 RECOMMENDATION: Recommend to the Board of Directors to: Approve the addition of five (5) new positions and the upgrade of one (1) position for FY 2025-2026 as follows: A.Add two (2) Engineering Supervisors (Salary Grade SUP92); B.Add one (1) Senior Engineer (Salary Grade PRO88); C.Add one (1) Engineer (Salary Grade PRO84); D.Add one (1) Senior Planner/Scheduler (Salary Grade PRO84); and E.Upgrade one (1) Contract/Purchasing Technician (Salary Grade OCE67) to Buyer (Salary Grade PRO70). Originator:Laura Maravilla Page 3 of 5 ADMINISTRATION COMMITTEE Regular Meeting Agenda Wednesday, December 10, 2025 Agenda ReportAttachments: 9.2025-4636PAYMENT AGREEMENT FOR CHARGES AND FEES OWED BY COLOR FASHION DYE AND FINISHING, LLC INDUSTRIAL WASTEWATER DISCHARGE PERMITTEE RECOMMENDATION: Recommend to the Board of Directors to: Approve the Payment Agreement for charges owed for user fees with Color Fashion Dye & Finishing, an Industrial Wastewater Discharge Permittee, in the amount of $114,848.28, pending receipt of acceptable payment security. Originator:Wally Ritchie Agenda Report Color Fashion Dye Finishing Payment Agreement DRAFT Attachments: 10.2025-4637INVEST AND/OR REINVEST ORANGE COUNTY SANITATION DISTRICT’S FUNDS AND ADOPT INVESTMENT POLICY STATEMENT RECOMMENDATION: Recommend to the Board of Directors to: Adopt Resolution No. OC SAN 25-XX entitled: “A Resolution of the Board of Directors of the Orange County Sanitation District, Authorizing the Orange County Sanitation District’s Treasurer to Invest and/or Reinvest the Orange County Sanitation District’s Funds, Adopting the Orange County Sanitation District’s Investment Policy Statement and Performance Benchmarks, and Repealing Resolution No. OC SAN 24-14”. Originator:Wally Ritchie Agenda Report Orange County Sanitation District Calendar Year 2025 Investment Policy Statement (Redline) Orange County Sanitation District Calendar Year 2026 Investment Policy Statement (Clean) Proposed Resolution OC SAN No. 25-XX Attachments: INFORMATION ITEMS: 11.2025-4638INFORMATION TECHNOLOGY UPDATES RECOMMENDATION: Information Item. Originator:Wally Ritchie Agenda ReportAttachments: Page 4 of 5 ADMINISTRATION COMMITTEE Regular Meeting Agenda Wednesday, December 10, 2025 DEPARTMENT HEAD REPORTS: CLOSED SESSION: None. OTHER BUSINESS AND COMMUNICATIONS OR SUPPLEMENTAL AGENDA ITEMS, IF ANY: BOARD OF DIRECTORS INITIATED ITEMS FOR A FUTURE MEETING: At this time Directors may request staff to place an item on a future agenda. ADJOURNMENT: Adjourn the meeting until the Regular Meeting of the Administration Committee on February 11, 2026 at 5:00 p.m. AFFIDAVIT OF PUBLICATION: I hereby certify under penalty of perjury and as required by the State of California, Government Code § 54954.2(a), that the foregoing Agenda was posted online at www.ocsan.gov, in the lobby, and outside the main door of Orange County Sanitation District Headquarters at 18480 Bandilier Cir. Fountain Valley, CA 92708 not less than 72 hours prior to the meeting date and time above. All public records relating to each agenda item, including those distributed less than 72 hours prior to the meeting to a majority of the Board of Directors, are available for public inspection with the Clerk of the Board. /s/ Kelly A. Lore, MMC Clerk of the Board December 3, 2025 Page 5 of 5 Orange County Sanitation District Minutes for the ADMINISTRATION COMMITTEE Wednesday, November 12, 2025 5:00 PM Board Room Headquarters 18480 Bandilier Circle Fountain Valley, CA 92708 (714) 593-7433 CALL TO ORDER A regular meeting of the Administration Committee of the Orange County Sanitation District was called to order by Committee Chairwoman Christine Marick on Wednesday, November 12, 2025 at 5:00 p.m. in the Orange County Sanitation District Headquarters. Committee Vice Chairman Grandis led the Pledge of Allegiance. ROLL CALL AND DECLARATION OF QUORUM: The Clerk of the Board declared a quorum present as follows: PRESENT:Ryan Gallagher, Glenn Grandis, Christine Marick, Jose Medrano, Jordan Nefulda, Andrew Nguyen, David Shawver, Chad Wanke, Erik Weigand, John Withers and Jordan Wu ABSENT:Jon Dumitru and Melinda Liu STAFF PRESENT: Lorenzo Tyner, Assistant General Manager; Mike Dorman, Director of Engineering; Laura Maravilla, Director of Human Resources; Riaz Moinuddin, Director of Operations and Maintenance; Wally Ritchie, Director of Finance; Lan Wiborg, Director of Environmental Services; Kelly Lore, Clerk of the Board; Mo Abiodun; Sam Choi; Daisy Covarrubias; Rhea De Guzman; Thys DeVries; Al Garcia; Bryce Hockensmith; Mark Kawamoto; Rebecca Long; Tom Meregillano; Aldwin Ramirez; Don Stokes; Thomas Vu; Kevin Work; Ruth Zintzun were present in the Board Room. General Manager Rob Thompson was present virtually. OTHERS PRESENT: Scott Smith, General Counsel; Roger Alfaro, Eide Bailly LLP; and Eric O'Donnell, Townsend Public Affairs were present in the Board Room. PUBLIC COMMENTS: None. Clerk of the Board Kelly Lore announced that Late Communication pertaining to the recommendation of Agenda Item No. 9 was received after the publication of the agenda, distributed to the Committee; and made available to the public. REPORTS: Chair Marick informed the Committee that OC San’s Administrative Offices will be closed on November 27 and 28, for the Thanksgiving holiday. She also announced that this month’s Board of Directors meeting will take place one week earlier, on Wednesday, November 19. Page 1 of 8 ADMINISTRATION COMMITTEE Minutes November 12, 2025 Assistant Manager Lorenzo Tyner provided a brief update on the anticipated storm and information on Code Blue status for OC San Plant operations. CONSENT CALENDAR: 1.APPROVAL OF MINUTES 2025-4568 Originator: Kelly Lore MOVED, SECONDED, AND DULY CARRIED TO: Approve minutes of the Regular meeting of the Administration Committee held October 8, 2025. AYES:Ryan Gallagher, Glenn Grandis, Christine Marick, Jose Medrano, Jordan Nefulda, Andrew Nguyen, David Shawver, Chad Wanke, Erik Weigand, John Withers and Jordan Wu NOES:None ABSENT:Jon Dumitru and Melinda Liu ABSTENTIONS:None 2.PUBLIC AFFAIRS UPDATE FOR THE MONTH OF OCTOBER 2025 2025-4527 Originator: Jennifer Cabral MOVED, SECONDED, AND DULY CARRIED TO: Recommend to the Board of Directors to: Receive and file the Public Affairs Update for the month of October 2025. AYES:Ryan Gallagher, Glenn Grandis, Christine Marick, Jose Medrano, Jordan Nefulda, Andrew Nguyen, David Shawver, Chad Wanke, Erik Weigand, John Withers and Jordan Wu NOES:None ABSENT:Jon Dumitru and Melinda Liu ABSTENTIONS:None 3.ORANGE COUNTY SANITATION DISTRICT 2026 LEGISLATIVE AND REGULATORY PLAN 2025-4571 Originator: Jennifer Cabral MOVED, SECONDED, AND DULY CARRIED TO: Recommend to the Board of Directors to: Adopt the Orange County Sanitation District 2026 Legislative and Regulatory Plan. Page 2 of 8 ADMINISTRATION COMMITTEE Minutes November 12, 2025 AYES:Ryan Gallagher, Glenn Grandis, Christine Marick, Jose Medrano, Jordan Nefulda, Andrew Nguyen, David Shawver, Chad Wanke, Erik Weigand, John Withers and Jordan Wu NOES:None ABSENT:Jon Dumitru and Melinda Liu ABSTENTIONS:None 4.CONSOLIDATED FINANCIAL REPORT FOR THE FIRST QUARTER ENDED SEPTEMBER 30, 2025 2025-4560 Originator: Wally Ritchie MOVED, SECONDED, AND DULY CARRIED TO: Recommend to the Board of Directors to: Receive and file the Orange County Sanitation District First Quarter Financial Report for the period ended September 30, 2025. AYES:Ryan Gallagher, Glenn Grandis, Christine Marick, Jose Medrano, Jordan Nefulda, Andrew Nguyen, David Shawver, Chad Wanke, Erik Weigand, John Withers and Jordan Wu NOES:None ABSENT:Jon Dumitru and Melinda Liu ABSTENTIONS:None 5.TREASURER’S REPORT FOR THE FIRST QUARTER ENDED SEPTEMBER 30, 2025 2025-4444 Originator: Wally Ritchie MOVED, SECONDED, AND DULY CARRIED TO: Recommend to the Board of Directors to: Receive and file the Orange County Sanitation District First Quarter Treasurer’s Report for the period ended September 30, 2025. AYES:Ryan Gallagher, Glenn Grandis, Christine Marick, Jose Medrano, Jordan Nefulda, Andrew Nguyen, David Shawver, Chad Wanke, Erik Weigand, John Withers and Jordan Wu NOES:None ABSENT:Jon Dumitru and Melinda Liu ABSTENTIONS:None Page 3 of 8 ADMINISTRATION COMMITTEE Minutes November 12, 2025 Vice Chairman Grandis pulled Item No. 6 from the consent calendar and stated a conflict of interest with the noted vendor. 6.INDUSTRIAL CONTROL SYSTEM PENETRATION TEST AND VULNERABILITY ASSESSMENT 2025-4582 Originator: Wally Ritchie MOVED, SECONDED, AND DULY CARRIED TO: A. Approve a Purchase Order Contract to Carahsoft Technology Corp for the purchase of an Industrial Control System Network Penetration Test and Vulnerability Assessment utilizing the cooperative OMNIA Software Solutions and Services Contract No. R240303, for a total amount not to exceed $210,750 (Includes Sales Tax); and B. Approve a contingency in the amount of $21,075 (10%). AYES:Ryan Gallagher, Christine Marick, Jose Medrano, Jordan Nefulda, Andrew Nguyen, David Shawver, Chad Wanke, Erik Weigand, John Withers and Jordan Wu NOES:None ABSENT:Jon Dumitru and Melinda Liu ABSTENTIONS:Glenn Grandis 7.GENERAL MANAGER APPROVED PURCHASES AND ADDITIONS TO THE PRE-APPROVED OEM SOLE SOURCE LIST 2025-4584 Originator: Wally Ritchie MOVED, SECONDED, AND DULY CARRIED TO: Recommend to the Board of Directors to: A. Receive and file Orange County Sanitation District purchases made under the General Manager’s authority for the period of July 1, 2025 to September 30, 2025; and B. Approve the following additions to the pre-approved Original Equipment Manufacturers (OEM) Sole Source List: ·BENTLY NEVADA, LLC - System 1 Software Maintenance & Support ·FARO TECHNOLOGIES, INC. - Laser Equipment, Hardware Service, Software, Maintenance and Training ·EMERSON PROCESS MANAGEMENT - Technical Support for Software and Equipment ·STO ADVISORS - Professional Services to Manage Pipeline and Hazardous Materials Safety Administration (PHMSA) Federal Regulations Page 4 of 8 ADMINISTRATION COMMITTEE Minutes November 12, 2025 AYES:Ryan Gallagher, Glenn Grandis, Christine Marick, Jose Medrano, Jordan Nefulda, Andrew Nguyen, David Shawver, Chad Wanke, Erik Weigand, John Withers and Jordan Wu NOES:None ABSENT:Jon Dumitru and Melinda Liu ABSTENTIONS:None NON-CONSENT: 8.LEGISLATIVE AFFAIRS UPDATE FOR THE MONTH OF OCTOBER 2025 2025-4581 Originator: Jennifer Cabral Mr. Tyner introduced Townsend Public Affairs Director Eric O'Donnell, who provided a PowerPoint presentation on the State Legislative Update. The presentation included an overview of the 2025 legislative session bills, the state budget, and several significant topics, such as cap-and-invest reauthorization, CEQA implementation, immigration response, congressional redistricting, and new Senate leadership. It also covered updates on cap and invest advocacy, and some notable legislations, including AB 339 (Ortega), SB 682 (Allen) – Non-Essential PFAS Use Ban, AB 823 (Boerner) – Plastic Microbeads and Plastic Glitter, SB 454 (McNerney) – PFAS Mitigation Fund, SB 707 (Durazo) – Brown Act: Teleconferencing, and video retention reform. MOVED, SECONDED, AND DULY CARRIED TO: Recommend to the Board of Directors to: Receive and file the Legislative Affairs Update for the month of October 2025. AYES:Ryan Gallagher, Glenn Grandis, Christine Marick, Jose Medrano, Jordan Nefulda, Andrew Nguyen, David Shawver, Chad Wanke, Erik Weigand, John Withers and Jordan Wu NOES:None ABSENT:Jon Dumitru and Melinda Liu ABSTENTIONS:None 9.ORANGE COUNTY SANITATION DISTRICT ANNUAL COMPREHENSIVE FINANCIAL REPORT FOR THE YEAR ENDED JUNE 30, 2025 2025-4562 Originator: Wally Ritchie Director of Finance Wally Ritchie introduced Finance Manager Ruth Zintzun who introduced Accounting Supervisor Bryce Hockensmith who provided a PowerPoint presentation regarding the financial cycle, the FY 24-25 budget versus actuals, CIP expenditures, available resources, and the debt profile. Mr. Hockensmith introduced Roger Alfaro from the auditing firm Eide Bailly, who presented the independent auditing Page 5 of 8 ADMINISTRATION COMMITTEE Minutes November 12, 2025 results. MOVED, SECONDED, AND DULY CARRIED TO: Recommend to the Board of Directors to: Receive and file the Orange County Sanitation District’s (OC San) Annual Comprehensive Financial Report for the year ended June 30, 2025, prepared by staff and audited by Eide Bailly LLP, Certified Public Accountants, along with the following reports prepared by Eide Bailly LLP: 1. Report to the Board of Directors; 2. Independent Accountants’ Report on Agreed-Upon Procedures Applied to Appropriations Limit Worksheets; and 3. Report on Internal Control Over Financial Reporting and on Compliance and Other Matters Based on an Audit of Financial Statements Performed in Accordance with Government Auditing Standards. AYES:Ryan Gallagher, Glenn Grandis, Christine Marick, Jose Medrano, Jordan Nefulda, Andrew Nguyen, David Shawver, Chad Wanke, Erik Weigand, John Withers and Jordan Wu NOES:None ABSENT:Jon Dumitru and Melinda Liu ABSTENTIONS:None 10.ORANGE COUNTY SANITATION DISTRICT POPULAR ANNUAL FINANCIAL REPORT FOR THE YEAR ENDED JUNE 30, 2025 2025-4561 Originator: Wally Ritchie Mr. Ritchie provided an overview of the item. MOVED, SECONDED, AND DULY CARRIED TO: Recommend to the Board of Directors to: Receive and file the Orange County Sanitation District Popular Annual Financial Report for the year ended June 30, 2025. AYES:Ryan Gallagher, Glenn Grandis, Christine Marick, Jose Medrano, Jordan Nefulda, Andrew Nguyen, David Shawver, Chad Wanke, Erik Weigand, John Withers and Jordan Wu NOES:None ABSENT:Jon Dumitru and Melinda Liu ABSTENTIONS:None 11.JOINT POWERS AGREEMENT, SOUTHERN CALIFORNIA COASTAL WATER RESEARCH PROJECT AUTHORITY (SCCWRP) 2025-4353 Originator: Lan Wiborg Page 6 of 8 ADMINISTRATION COMMITTEE Minutes November 12, 2025 Mr. Tyner provided a brief report of the item. Environmental Protection Manager Sam Choi responded to questions regarding to the ocean outfall permit. MOVED, SECONDED, AND DULY CARRIED TO: Recommend to the Board of Directors to: A. Adopt Resolution No. OC SAN 25-XX titled, “A Resolution of the Board of Directors of the Orange County Sanitation District approving the Eleventh Amended Joint Powers Agreement confirming the creation of an agency known as Southern California Coastal Water Research Project Authority (SCCWRP), providing for continuation of SCCWRP for five years from July 1, 2026 through June 30, 2031”; and B. Approve annual funding in the amount of $600,000 for FY 2026/27; $618,000 for FY 2027/28; $636,000 for FY 2028/29; $656,000 for FY 2029/30; and $675,000 for FY 2030/31. AYES:Ryan Gallagher, Glenn Grandis, Christine Marick, Jose Medrano, Jordan Nefulda, Andrew Nguyen, David Shawver, Chad Wanke, Erik Weigand, John Withers and Jordan Wu NOES:None ABSENT:Jon Dumitru and Melinda Liu ABSTENTIONS:None INFORMATION ITEMS: None. DEPARTMENT HEAD REPORTS: None. CLOSED SESSION: None. OTHER BUSINESS AND COMMUNICATIONS OR SUPPLEMENTAL AGENDA ITEMS, IF ANY: None. BOARD OF DIRECTORS INITIATED ITEMS FOR A FUTURE MEETING: None. Page 7 of 8 ADMINISTRATION COMMITTEE Minutes November 12, 2025 ADJOURNMENT: Chair Marick declared the meeting adjourned at 5:38 p.m. to the next Regular Administration Committee meeting to be held on Wednesday, December 10, 2025 at 5:00 p.m. Submitted by: __________________ Kelly A. Lore, MMC Clerk of the Board Page 8 of 8 ADMINISTRATION COMMITTEE Agenda Report Headquarters 18480 Bandilier Circle Fountain Valley, CA 92708 (714) 593-7433 File #:2025-4558 Agenda Date:12/10/2025 Agenda Item No:2. FROM:Robert Thompson, General Manager Originator: Lan C. Wiborg, Director of Environmental Services SUBJECT: PAYMENT OF ANNUAL NATIONAL POLLUTANT DISCHARGE ELIMINATION SYSTEM PERMIT FEES GENERAL MANAGER'S RECOMMENDATION RECOMMENDATION: Recommend to the Board of Directors to: Approve payment to the State Water Resources Control Board in an amount not to exceed $950,000 for the annual National Pollutant Discharge Elimination System ocean discharge permit fees for Fiscal Year 2025-2026. BACKGROUND Under the Clean Water Act,the Orange County Sanitation District (OC San)lawfully discharges treated wastewater into the Pacific Ocean under its National Pollutant Discharge Elimination System (NPDES)ocean discharge permit which is jointly administered by the Santa Ana Regional Water Quality Control Board (SARWQCB)and the United States Environmental Protection Agency (USEPA).In accordance with Sections 13260 and 13269 of the California Water Code,an annual fee is required to maintain this permit. The fee is based on OC San’s facility design flow. OC San is expecting an invoice for the permit fee from the State Water Resources Control Board (SWRCB)to arrive in December 2025 with a short turnaround time for payment.Staff have confirmed with SWRCB personnel the Fiscal Year 2025-2026 annual permit fee will be similar to the annual permit fee for Fiscal Year 2024-2025 ($917,519)but below $950,000.Thus,staff recommends that the Board of Directors approve payment of the annual ocean discharge permit fees for Fiscal Year 2025-2026 in the amount not to exceed $950,000. RELEVANT STANDARDS ·Comply with environmental permit requirements ·24/7/365 treatment plant reliability ·Comply with Government Code Section (California Water Code Sections 13260 & 13269) Orange County Sanitation District Printed on 12/1/2025Page 1 of 2 powered by Legistar™ File #:2025-4558 Agenda Date:12/10/2025 Agenda Item No:2. PROBLEM OC San is required by California Water Code Sections 13260 and 13269 to pay an annual fee to maintain our NPDES ocean discharge permit. PROPOSED SOLUTION Approve payment of the annual NPDES ocean discharge permit fees in an amount not to exceed $950,000, as to be invoiced by the SWRCB for Fiscal Year 2025-2026. TIMING CONCERNS If the invoice is not paid in a timely manner, OC San may be subject to late fees. RAMIFICATIONS OF NOT TAKING ACTION If payment is delayed,OC San would be subject to penalties under provisions of the California Water Code Section 13261.These actions could include daily penalties in addition to the fee or other actions deemed appropriate by SARWQCB. PRIOR COMMITTEE/BOARD ACTIONS This fee is invoiced and paid annually. ADDITIONAL INFORMATION N/A CEQA N/A FINANCIAL CONSIDERATIONS This request complies with authority levels of OC San’s Purchasing Ordinance.This item has been budgeted (Budget FY 2024-25 and 2025-26,Section 6,Page 64,Environmental Compliance)and the budget is sufficient for the recommended action. ATTACHMENT The following attachment(s)may be viewed on-line at the OC San website (www.ocsan.gov)with the complete agenda package: N/A Orange County Sanitation District Printed on 12/1/2025Page 2 of 2 powered by Legistar™ ADMINISTRATION COMMITTEE Agenda Report Headquarters 18480 Bandilier Circle Fountain Valley, CA 92708 (714) 593-7433 File #:2025-4627 Agenda Date:12/10/2025 Agenda Item No:3. FROM:Robert Thompson, General Manager Originator: Wally Ritchie, Director of Finance SUBJECT: IBM MAXIMO EMERGENCY AND LEVEL 3 SUPPORT GENERAL MANAGER'S RECOMMENDATION RECOMMENDATION: A. Approve a Sole Source Purchase Order Agreement with Total Resource Management, Inc. to provide Emergency and Level 3 support for IBM Maximo software, for a total amount not to exceed $160,000 for the period of January 1, 2026, through December 31, 2026, with four (4) optional one-year renewals; and B. Approve an annual contingency of $16,000 (10%). BACKGROUND Orange County Sanitation District’s (OC San)Operations &Maintenance Department,and the Warehouse and Fleet Divisions utilize IBM Maximo software (IBM-Maximo)as their core business software.The benefits of IBM-Maximo include improved asset and labor productivity,optimization of maintenance resources,and efficiency in inventory management.OC San requires Emergency and Level 3 support from a third-party vendor to support this software.Level 3 support is the highest tier of Information Technology (IT)support,involving highly skilled engineers and specialists who handle the most complex and critical technical issues that cannot be resolved by lower tiers.This level is responsible for in-depth diagnosis,developing solutions like patches,and often involves roles such as IT architects,network engineers,and software developers.They are the final line of defense,and their work may lead to recommending system changes or new software to prevent future problems. Total Resource Management,Inc.(TRM)has provided this support for the last thirteen years efficiently. RELEVANT STANDARDS ·Ensure public’s money is wisely spent ·Maintain a culture of improving efficiency to reduce the cost to provide the current service level or standard ·Protect OC San’s assets ·Maintain a proactive asset management program Orange County Sanitation District Printed on 12/3/2025Page 1 of 3 powered by Legistar™ File #:2025-4627 Agenda Date:12/10/2025 Agenda Item No:3. PROBLEM The Operations &Maintenance Department,and the Warehouse and Fleet Divisions utilize IBM- Maximo as its core software.To provide adequate support for these divisions,additional IT resources are required on an as needed basis.Support of the software includes troubleshooting,upgrades, implementing new functionality, testing, and documentation. PROPOSED SOLUTION Approve a Sole Source Purchase Order Agreement to provide support on an as-needed basis. TIMING CONCERNS N/A RAMIFICATIONS OF NOT TAKING ACTION Not approving the item will result in lower levels of service in supporting IBM-Maximo software and its functionality which could decrease efficiency in Operations &Maintenance Department and the Warehouse and Fleet Divisions. PRIOR COMMITTEE/BOARD ACTIONS November 2020 -Approved a Sole Source Professional Services Agreement to Total Resource Management,Inc to provide Emergency and Level 3 support for IBM Maximo software,for the time period of January 1,2021,through December 31,2021,for a total amount not to exceed $160,000; and authorized an option for four (4) one-year renewals at $160,000 per year. ADDITIONAL INFORMATION TRM was placed on the Original Equipment Manufacturers (OEM)Board Approved Sole Source List in November 2019.TRM has assisted OC San with the Maximo system architecture,setup,and implementation and has provided Emergency and Level 3 Support for the past four years.They are familiar with OC San’s business processes,personnel,and Maximo infrastructure.TRM is also the developer of Rules Manager,a proprietary software that is used by OC San to enforce all business rules within IBM-Maximo;and the developer of the Lock Out Tag Out (LOTO)module implemented within Maximo.The LOTO module tracks the safety procedures that are followed during maintenance work.TRM has provided best practices and Maximo expertise in assisting OC San in succeeding with our business principles for the last eight years. CEQA N/A FINANCIAL CONSIDERATIONS This request complies with authority levels of the OC San's Purchasing Ordinance.This item has been budgeted (FY2025-26 Budget, Section 6, Page 24). Orange County Sanitation District Printed on 12/3/2025Page 2 of 3 powered by Legistar™ File #:2025-4627 Agenda Date:12/10/2025 Agenda Item No:3. ATTACHMENT The following attachment(s)may be viewed on-line at the OC San website (www.ocsan.gov)with the complete agenda package: N/A Orange County Sanitation District Printed on 12/3/2025Page 3 of 3 powered by Legistar™ ADMINISTRATION COMMITTEE Agenda Report Headquarters 18480 Bandilier Circle Fountain Valley, CA 92708 (714) 593-7433 File #:2025-4630 Agenda Date:12/10/2025 Agenda Item No:4. FROM:Robert Thompson, General Manager Originator: Wally Ritchie, Director of Finance SUBJECT: COOPERATIVE PROCUREMENT AGREEMENT GENERAL MANAGER'S RECOMMENDATION RECOMMENDATION: Recommend to the Board of Directors to: Approve a Blanket Purchase Order with Insight Public Sector Inc.for the purchase of technology products,equipment,services and solutions using the cooperative OMNIA Contract No.23-6692-03 for a total amount not to exceed $1,200,000;for the term January 1,2026,through December 31, 2026,in accordance with Ordinance No.OC SAN-61,Section 2.03(B)Cooperative Purchases;with two (2) optional one-year renewal options. BACKGROUND Orange County Sanitation District (OC San)currently uses Cooperative Procurement Agreements (CPAs)to provide technology products,equipment,services and solutions.These CPAs provide deep discounts that are not normally available through OC San’s bid process. The Blanket Purchase Order is needed to provide technological solutions expeditiously based on competitive contract pricing,breadth of product offerings,availability,and simplicity of using online ordering systems.Large capital items will be procured through the bidding process,and all purchases will continue to follow the existing approval and procurement processes in accordance with OC San’s Purchasing Ordinance. To properly maintain and provide solutions to OC San’s facilities,the Information Technology (IT) Division has a need to purchase technology products,services,and solutions frequently.Such item requirements have been forecasted based upon projected obsolete equipment,historical product failure rates,and new items to address general capacity,redundancy,or security for the Office and Industrial Control System.Since technology changes frequently,it is not appropriate to stock these items in OC San’s warehouses. Purchases include but are not limited to the following: ·Networking and telephony equipment ·Servers and desktop computers ·Data storage and backup appliances Orange County Sanitation District Printed on 12/1/2025Page 1 of 3 powered by Legistar™ File #:2025-4630 Agenda Date:12/10/2025 Agenda Item No:4. ·Software licenses and maintenance agreements ·Consulting services ·Disaster recovery and cyber security solutions ·Printers, scanners, and monitors ·Computer peripherals ·Uninterruptible power supply components RELEVANT STANDARDS ·Protect OC San assets ·Ensure the public’s money is wisely spent ·Participate in local, state, and national cooperative purchasing programs ·Maintain a culture of improving efficiency to reduce the cost to provide the current level of service or standard PROBLEM The IT Division has a constant need to procure equipment and services based on the needs of OC San and therefore requires a method to procure these items expeditiously while also meeting the requirements of the Purchasing Ordinance. PROPOSED SOLUTION Approve a Blanket Purchase Order with Insight Public Sector Inc.using OMNIA Contract No.23- 6692-03,allowing a quick procurement process of a broad portfolio of IT products and services at discounted prices. TIMING CONCERNS Maintenance and deployment of new systems and solutions is imperative for timely support of plant operations and maintenance initiatives. RAMIFICATIONS OF NOT TAKING ACTION An increased procurement time risks delaying IT projects and support to plant operations and maintenance. PRIOR COMMITTEE/BOARD ACTIONS November 2022 -Authorized the purchasing of information technology products,services,and solutions utilizing Cooperative Procurement Agreements (CPA)from U.S.General Services Administration (GSA)IT Schedule 70,National Association of State Procurement Officials ValuePoint Cooperative Purchasing Organization,and OMNIA Partners,Public Sector (formerly U.S. Communities)for the period January 1,2023 through December 31,2023 for a total amount not to exceed $2,000,000,in accordance with Ordinance No.OCSD-52,Section 2.03(8)Cooperative Purchases, with two (2) one-year renewal options. October 2019 -Authorized the purchasing of information technology products,services,and solutionsOrange County Sanitation District Printed on 12/1/2025Page 2 of 3 powered by Legistar™ File #:2025-4630 Agenda Date:12/10/2025 Agenda Item No:4. October 2019 -Authorized the purchasing of information technology products,services,and solutions utilizing Cooperative Procurement Agreements (CPA)from U.S.General Services Administration (GSA)IT Schedule 70,National Association of State Procurement Officials ValuePoint Cooperative Purchasing Organization,and OMNIA Partners,Public Sector (formerly U.S.Communities)for the period January 1,2020 through December 31,2020 for a total amount not to exceed $2,000,000,in accordance with Ordinance No.OCSD-52,Section 2.03(8)Cooperative Purchases,with two (2)one- year renewal options. ADDITIONAL INFORMATION OMNIA Partners is a large cooperative purchasing organization that provides public and private sector organizations with access to competitively bid contracts from a network of suppliers.By pooling the purchasing power of its members,OMNIA Partners help institutions like government agencies,schools,and nonprofits get better pricing and streamlined procurement processes.It offers benefits like discounts,spend analytics,and subject matter expertise,saving its members time and resources by eliminating the need for them to conduct their own individual competitive bidding processes. The Contract with Insight Public Sector was competitively bid out through Cobb County to establish a national cooperative contract for Technology Product Solutions and Related Services.The contract includes a comprehensive range of products and services with a discount pricing structure off its list price. CEQA N/A FINANCIAL CONSIDERATIONS This request complies with the authority levels of OC San's Purchasing Ordinance.This item has been budgeted (FY2025-26 Budget Section 6, Page 24). ATTACHMENT The following attachment(s)may be viewed on-line at the OC San website (www.ocsan.gov)with the complete agenda package: N/A Orange County Sanitation District Printed on 12/1/2025Page 3 of 3 powered by Legistar™ ADMINISTRATION COMMITTEE Agenda Report Headquarters 18480 Bandilier Circle Fountain Valley, CA 92708 (714) 593-7433 File #:2025-4574 Agenda Date:12/10/2025 Agenda Item No:5. FROM:Robert Thompson, General Manager Originator: Wally Ritchie, Director of Finance SUBJECT: ORANGE COUNTY EMPLOYEES RETIREMENT SYSTEM PREPAYMENT GENERAL MANAGER'S RECOMMENDATION RECOMMENDATION: Recommend to the Board of Directors to: Approve prepayments of Orange County Employees Retirement System contributions in the amount of $10.3 million, using funds from OC San’s 115 Trust. BACKGROUND Orange County Employees Retirement System (OCERS)offers agencies the opportunity to participate in the Early Payment of Employer Contributions Program.This program allows agencies to prepay their annual OCERS contribution with a discount rate of 7%.OC San has participated in this program since 2010 to realize savings on contributions. In 2021,OC San implemented an Internal Revenue Service Code Section 115 Trust Pension Account (115 Trust)with Public Agency Retirement Services.The 115 Trust is established to fund pension obligations,once contributions are made into the trust,fund use is limited to pension costs.OC San’s future pension obligation to OCERS is fully funded as of June 30, 2025. The current balance in the OC San’s 115 Trust account is $18.3 million.The recommended OCERS Prepayment is $10.3 million, leaving a balance of 8.0 million in the 115 Trust account. RELEVANT STANDARDS ·Ensure the public’s money is wisely spent ·Ensure that investment proposals and decisions are based on clearly defined standards PROBLEM Funds in the 115 Trust can only be used to pay for pension obligations. PROPOSED SOLUTION Prepay OCERS contributions using funds from OC San’s 115 Trust. Orange County Sanitation District Printed on 12/1/2025Page 1 of 2 powered by Legistar™ File #:2025-4574 Agenda Date:12/10/2025 Agenda Item No:5. TIMING CONCERNS Prepayments to OCERS must be made by January 15th to qualify for the 7% discount. RAMIFICATIONS OF NOT TAKING ACTION The funds held in the 115 Trust cannot be used for any other purpose. PRIOR COMMITTEE/BOARD ACTIONS November 2021 -Adopt Resolution No.OC SAN 21-17 entitled:“A Resolution of the Board of Directors of Orange County Sanitation District Adopting a Post-Employment Benefit Trust Agreement with Public Agency Retirement Services;and Authorizing Officers to Execute Documents and Agreements;and Authorize staff to make an initial investment of up to $15 million into the Section 115 pension trust. ADDITIONAL INFORMATION N/A CEQA N/A FINANCIAL CONSIDERATIONS This item has been budgeted (Budget FY 2024-25 and 2025-26,Page 15,Salaries,Wages & Benefits) and the budget is sufficient for the recommended action. ATTACHMENT The following attachment(s)may be viewed on-line at the OC San website (www.ocsan.gov)with the complete agenda package: N/A Orange County Sanitation District Printed on 12/1/2025Page 2 of 2 powered by Legistar™ ADMINISTRATION COMMITTEE Agenda Report Headquarters 18480 Bandilier Circle Fountain Valley, CA 92708 (714) 593-7433 File #:2025-4626 Agenda Date:12/10/2025 Agenda Item No:6. FROM:Robert Thompson, General Manager Originator: Jennifer Cabral, Director of Communications SUBJECT: LEGISLATIVE AFFAIRS UPDATE FOR THE MONTH OF NOVEMBER 2025 GENERAL MANAGER'S RECOMMENDATION RECOMMENDATION: Recommend to the Board of Directors to: Receive and file the Legislative Affairs Update for the month of November 2025. BACKGROUND The Orange County Sanitation District’s (OC San)legislative affairs program includes advocating for OC San’s legislative interests,sponsoring legislation (where appropriate),and seeking local,state, and federal funding for projects and programs. RELEVANT STANDARDS ·Maintain influential legislative advocacy and a public outreach program ·Build brand, trust, and support with policy makers and community leaders ·Maintain collaborative and cooperative relationships with regulators,stakeholders,and neighboring communities PROBLEM Without a strong advocacy program,elected officials may not be aware of OC San’s mission, programs, and projects, or how they could be impacted by proposed legislation. PROPOSED SOLUTION Continue to work with Local,State,and Federal officials to advocate for OC San’s interests and help identify,create and monitor legislation and grants opportunities that would benefit OC San,the wastewater industry,and the community.To strengthen relationship building efforts,OC San will continue to engage elected officials through facility tours,one-on-one meetings,and outreach trips to Washington D.C. and Sacramento. Orange County Sanitation District Printed on 12/2/2025Page 1 of 2 powered by Legistar™ File #:2025-4626 Agenda Date:12/10/2025 Agenda Item No:6. RAMIFICATIONS OF NOT TAKING ACTION If OC San does not actively engage with Local,State,and Federal elected officials,legislation could be enacted that negatively impacts OC San and the wastewater industry.Additionally,lack of engagement may result in missed funding opportunities. ADDITIONAL INFORMATION Activities in November: ·The 2026 Legislative and Regulatory Plan went before the November Administration Committee and was adopted by the Board of Directors. Activities in December: ·As the legislature returns,we can expect bills to be introduced in late December and throughout January and February.OC San staff and Lobbyists will evaluate bills as they are introduced to establish if a position is deemed necessary and will bring to the Committee for comments and guidance. CEQA N/A FINANCIAL CONSIDERATIONS All items mentioned are included in OC San’s FY 2025-26 adopted Budget. ATTACHMENT The following attachment(s)may be viewed on-line at the OC San website (www.ocsan.gov)with the complete agenda package: ·Federal Legislative Update ·Federal Matrix ·State Legislative Update ·Local Legislative Update ·Presentation Orange County Sanitation District Printed on 12/2/2025Page 2 of 2 powered by Legistar™ 1 | P a g e TO: Orange County Sanitation District FROM: Eric Sapirstein DATE: November 21, 2025 SUBJECT: Washington Update After a record 45 days, Congress reached an agreement to end the government shutdown on November 12 when the House of Representatives joined the Senate and passed the Continuing Resolution (CR), after the Office of Management and Budget (OMB) transmitted a letter to Congress strongly supporting the CR. President Trump signed the bill to fund the government, bringing a close to the longest government shutdown in history. The passage of the CR represents a limited victory by reopening the federal government until January 30, 2026. Congress will have a little more than two months from the signing of the bill to reach agreement on full year, fiscal year (FY) 2026 spending bills that were not included in the CR, including spending bills that fund the U.S. Environmental Protection Agency (USEPA). It is important to note that the CR carries full year spending agreements for three of the twelve appropriations bills—Agriculture/U.S. Food and Drug Administration, Military Construction/Veterans Affairs, and Legislative Branch. Key Provisions of CR The CR passed the Senate 60-40 when seven Democrats and Senator Angus King (I- ME) joined Senate Republicans to provide the magic number of 60 votes to overcome a Democrat filibuster and the House approved the measure 222-202. The CR reopens and extends government operations through January 30. This means Congress must either pass a final CR for the remaining months of FY 2026 or secure an agreement on the outstanding nine spending bills before January 30 to avoid the potential of another shutdown. In this circumstance, an omnibus bill or a minibus (a package of several bills that have been reconciled) would likely carry the agreement through the House and Senate. 2 | P a g e The CR provides for continued funding of existing programs at FY 2025 levels until final spending bills are enacted. USEPA programs will be funded and presumably have the resources to finalize outstanding financial awards delayed by the shutdown. The CR contains increased funding for per- and polyfluoroalkyl substances (PFAS) cleanups at military installations and $9 million for USDA’s Center of Excellence for PFAS solutions that will likely continue to review PFAS impacts upon soils and cattle. Senate Committee to Examine PFAS Cleanup and Disposal Policy On November 19, the Senate Committee on Environment and Public Works held a hearing to examine future policy solutions to address PFAS cleanup and disposal. The hearing comes as Congress continues to try and develop policy that ensures parties responsible for PFAS contamination are held liable for cleanup and disposal costs and not those who passively receive the chemicals, like wastewater agencies. The hearing will include witnesses from Clean Harbors, a hazardous waste management services company, Associated General Contractors of America, and the Congressional Research Service. Importance to OC San While the hearing did not address Superfund liability exemption for passive receivers, it will keep pressure on lawmakers to create clear, practical protocols for managing PFAS as a hazardous substance and ensure cleanup policies are effective and enforceable. Based off of previous comments from the sectors represented by the witnesses, the discussion may highlight the unintended consequences USEPA’s 2024 Rule designating PFAS as a hazardous substances has created for cleanup and disposal of waste containing PFAS and the need for Congress to address these impacts statutorily. Last modified: 11/13/2025 at 04:25 PM EST OC San Federal Legislative Update November 2025 FEDERAL - 119TH CONGRESS S. 1092 WIPPES Act High Priority Support Summary: S.1092 would direct the Federal Trade Commission to estabilsh federal "Do Not Flush" labeling requirements for nonflushable wet wipes packaging. The labeling requirements would be enacted one year after the bill's enactment. The bill mirrors California's state labeling law and is supported by clean water, industry, environmental advocates, and civil engineer stakeholders. House companion legislation is HR 2269. 03/24/2025Introduced: Sen. Jeff Merkley ORSponsor: Latest Actions: 09/19/2025 - Placed on Senate Legislative Calendar under General Orders. Calendar No. 166. 09/19/2025 - Committee on Commerce, Science, and Transportation. Reported by Senator Cruz with an amendment in the n... 05/21/2025 - Committee on Commerce, Science, and Transportation. Ordered to be reported with an amendment in the nat... Senate Commerce, Science and Transportation Committees: Committee S. 1092 provides a source control solution to the problem of the flushing of Why it matters: nonflushable wipes that will reduce costs associated with fixing damaged treatment infrastructure for wastewater utilities. The labeling requirements compliment existing "Do Not Flush" labeling state law. Senator Alex Padilla is an original co-sponsor. OC San continues to publicly support the effort and has sent support letters to the delegation this Congress. Outlook: S. 1092 has high potential to be passed by the Senate this Congress based on the Committee on Commerce, Science and Transportation's bipartisan markup of the bill earlier this Spring. The committee's action raises the possibility for S. 1092 will be considered on the Floor under Unanimous Consent FEDERAL - 119TH CONGRESS H.R. 2269 WIPPES Act High Priority Support Summary: H.R. 2269 would direct the Federal Trade Commission to estabilsh federal "Do Not Flush" labeling requirements for nonflushable wet wipes packaging. The labeling requirements would be enacted one year after the bill's enactment. The bill mirrors California's state labeling law and is supported by clean water, industry, environmental advocates, and civil engineer stakeholders. Senate companion legislation is S. 1092. 03/21/2025Introduced: Rep. Lisa McClain MI-09Sponsor: Latest Actions: 06/24/2025 - Received in the Senate. 06/23/2025 - Motion to reconsider laid on the table Agreed to without objection. 06/23/2025 - On motion to suspend the rules and pass the bill Agreed to by voice vote. (text: CR H2852-2853) House Energy and Commerce CommitteeCommittees: H.R. 2269 provides a source control solution to the problem of the flushing Why it matters: of nonflushable wipes that will reduce costs associated with fixing damaged treatment infrastructure for wastewater utilities. The labeling requirements compliment existing "Do Not Flush" labeling state law. Rep. Lou Correa is a co-sponsor. OC San continues to publicly support the effort and has sent support letters to the delegation this Congress. Outlook: H.R. 2269 has high chances of passing the House this session. The legislation has been scheduled to be voted on under suspension on the House Floor the week of June 23. The Committee on Energy and Commerce's bipartisan markup of the bill also infer a bipartisan vote on the Floor. H.R. 3898 represents a comprehensive Clean Water Act permitting reform Why It Matters: bill. Key provisions: Outlook. The House is expected to consider H.R. 3898 this Fall. Passage is highly likely as many of the bill's provisions passed the House during the last Congress. This included ten year permits. FEDERAL - 119TH CONGRESS H.R. 2093 To amend the Federal Water Pollution Control Act with respect to permitting terms, and for other purposes. High Priority Support Summary: H.R. 2093 would amend the Clean Water Act's permitting provisions to allow for delegated states or USEPA to issue ten year National Permit Discharge Eliminate System (NPDES) permits. The bill, if enacted, would extend current terms from five years. 03/14/2025Introduced: Rep. Ken Calvert CA-41Sponsor: Latest Actions: 03/14/2025 - Referred to the Subcommittee on Water Resources and Environment. FEDERAL - 119TH CONGRESS H.R. 3898 PERMIT Act No Priority No Stance The PERMIT Act amends the Federal Water AI Summary: Pollution Control Act to streamline water quality standards, reduce regulatory burdens, clarify permitting terms, and improve federalism and efficiency in clean water permitting. 06/11/2025Introduced: Rep. Mike Collins GA-10Sponsor: Latest Actions: 07/02/2025 - Placed on the Union Calendar, Calendar No. 145. 07/02/2025 - Reported (Amended) by the Committee on Transportation and Infrastructure. H. Rept. 119-180. 07/02/2025 - POLITICO Pro - Republicans on the House Transportation and Infrastructure Committee Wednesday advanced a sweeping pack... House Transportation and Infrastructure Committee, Committees: House Transportation and Infrastructure Committee Water Resources and Environment Subcommittee mandated 10 year NPDES permits codification of exemption from WOTUS definition for wastewater and water storage facilities expedited review and approval of section 404 permit applications ten year general permits for dredge and fill activities with requirement for 2 year advanced notification if permit not to be renewed water quality certification reviews limited to project impacts on water quality 03/14/2025 - Referred to the House Committee on Transportation and Infrastructure. 03/14/2025 - Introduced in House House Transportation and Infrastructure Committee, Committees: House Transportation and Infrastructure Committee Water Resources and Environment Subcommittee H.R. 2093 amends the NPDES permit term to align with the current project Why it matters: construction timeline realities for water utilities and help reduce costs associated with permit renewals for both utilities and state regulators. H.R. 2093 provides this while preserving existing permit reopener provisions to ensure environmental protections are upheld. Outlook: H.R. 2093 has the potential to advance this Congress. Committee majority staff support the bill's policy intent and has expressed the desire to pursue last year's Creating Confidence Clean Water Permitting Act (HR 7023)again this Congress, which included H. R. 2093's permit extension language. H.R. 7023 passed the House in the 118th Congress. The legislation would provide important protection to water and wastewater Why It Matters: agencies against third party litigation seeking to secure cost contributions for cleanups that involve PFAS contamination. Absent an explicit liability protection provision such agencies would be exposed to liability simply because an agency treated water and wastewater that contained PFAS chemicals and disposed of residuals and biosolids. FEDERAL - 119TH CONGRESS H.R. 1267 Water Systems PFAS Liability Protection Act High Priority Support The Water Systems PFAS Liability Protection Act AI Summary: exempts water and wastewater treatment facilities from CERCLA liability for releases of certain perfluoroalkyl and polyfluoroalkyl substances, provided they comply with applicable laws and regulations. 02/12/2025Introduced: Rep. Marie Gluesenkamp Perez WA-03Sponsor: Latest Actions: 02/12/2025 - Referred to the Subcommittee on Water Resources and Environment. 02/12/2025 - Referred to the Committee on Energy and Commerce, and in addition to the Committee on Transportation an... 02/12/2025 - Referred to the Committee on Energy and Commerce, and in addition to the Committee on Transportation an... House Energy and Commerce Committee, House Committees: Transportation and Infrastructure Committee, House Transportation and Infrastructure Committee Water Resources and Environment Subcommittee Outlook: H.R. 1267 represents a placeholder bill to address the water sector's concerns over the potential liability created by USEPA's designation of PFAS as a hazardous substance under CERCLA. Both the House and Senate committees with jurisdiction over CERCLA have expressed interest in addressing PFAS liability. However, any significant legislative activity is expected to await USEPA's recommendations on how to address passive receivers liability created by the PFAS designation. FEDERAL - 119TH CONGRESS H.R. 1265 To amend the Save Our Seas 2.0 Act to expand eligibility for certain wastewater infrastructure grants, and for other purposes. No Priority No Stance Summary: H.R. 1265 aims to expand eligibility for certain wastewater infrastructure grants under the Save Our Seas 2.0 Act12. This expansion would allow communities and projects to qualify for federal funding, which can be used to improve and modernize wastewater treatment facilities. By increasing access to these grants, the bill seeks to enhance the capacity of wastewater management systems to handle pollutants, reduce environmental impacts, and support public health. This could lead to more efficient and effective wastewater treatment processes, ultimately contributing to cleaner waterways and a healthier environment. 02/12/2025Introduced: Del. Eleanor Holmes Norton DC-At LargeSponsor: Latest Actions: 04/01/2025 - Referred to the Subcommittee on Water Resources and Environment. 02/12/2025 - Referred to the House Committee on Transportation and Infrastructure. 02/12/2025 - Sponsor introductory remarks on measure. (CR E120) House Transportation and Infrastructure Committee, Committees: House Transportation and Infrastructure Committee Coast Guard and Maritime Transportation Subcommittee, House Transportation and Infrastructure Committee Water Resources and Environment Subcommittee FEDERAL - 119TH CONGRESS H.R. 1285 Water Infrastructure Subcontractor and Taxpayer Protection Act of 2025 No Priority No Stance Summary: H.R. 1285 would amend the Water Infrastructure Finance and Innovation Act of 2014. The key points: Payment and Performance Security Requirements: The bill establishes new requirements for payment and performance security for projects funded under the act. Project Funding: Ensure that projects financed through the Water Infrastructure Finance and Innovation Act have adequate financial safeguards.H.R. 2093 would amend the Clean Water Act's permitting provisions to allow for delegated states or USEPA to issue ten year National Permit Discharge Eliminate System (NPDES) permits. The bill, if enacted, would extend current terms from five years 02/13/2025Introduced: Rep. Mike Bost IL-12Sponsor: Latest Actions: 02/13/2025 - Referred to the Subcommittee on Water Resources and Environment. 02/13/2025 - Referred to the Committee on Transportation and Infrastructure, and in addition to the Committee on Ene... 02/13/2025 - Referred to the Committee on Transportation and Infrastructure, and in addition to the Committee on Ene... House Energy and Commerce Committee, House Committees: Transportation and Infrastructure Committee, House Transportation and Infrastructure Committee Water Resources and Environment Subcommittee FEDERAL - 119TH CONGRESS H.R. 2344 Water ISAC Threat Protection Act No Priority No Stance Summary: Would establish a program to enhance the preparedness and resilience of drinking water and wastewater systems against various threats. The bill's primary focus is on safeguarding these critical utilities from risks such as natural disasters, cyberattacks, and other vulnerabilities that could disrupt essential water services. 03/25/2025Introduced: Rep. Jan Schakowsky IL-09Sponsor: Latest Actions: 03/25/2025 - Referred to the Subcommittee on Water Resources and Environment. 03/25/2025 - Referred to the Committee on Transportation and Infrastructure, and in addition to the Committee on Ene... 03/25/2025 - Referred to the Committee on Transportation and Infrastructure, and in addition to the Committee on Ene... House Energy and Commerce Committee, House Committees: Transportation and Infrastructure Committee, House Transportation and Infrastructure Committee Water Resources and Environment Subcommittee FEDERAL - 119TH CONGRESS S. 857 Water Conservation Rebate Tax Parity Act No Priority No Stance Summary: Amends federal tax law so that homeowners would not need to pay income tax when they receive rebates from water utilities for water conservation and water runoff management improvements. S. 857. 03/05/2025Introduced: Sen. John Curtis UTSponsor: Latest Actions: 03/05/2025 - Read twice and referred to the Committee on Finance. 03/05/2025 - Introduced in Senate Senate Finance CommitteeCommittees: FEDERAL - 119TH CONGRESS S. 1118 Water Intelligence, Security, and Cyber Threat Protection Act of 2025 No Priority No Stance Summary: S. 1118 would provide funding and additional access for clean water and wastewater utilities to become members of the Water Information Sharing and Analysis Center (WaterISAC). The WaterISAC is a critical source of information and best practices for water systems to protect against, mitigate, and respond to threats. House Companion bill H.R. 2344. Endorsed by American Water Works Association, Association of Metropolitan Water Agencies, National Association of Clean Water Agencies, National Association of Water Companies, and Water Environment Federation. 03/25/2025Introduced: Sen. Ed Markey MASponsor: Latest Actions: 03/25/2025 - Read twice and referred to the Committee on Environment and Public Works. 03/25/2025 - Introduced in Senate Senate Environment and Public Works CommitteeCommittees: FEDERAL - 119TH CONGRESS H.R. 3184 PFAS Alternatives Act No Priority No Stance The bill establishes a research and training AI Summary: program to develop and promote PFAS-free turnout gear for firefighters, supporting innovation in firefighter safety through grants and partnerships. 05/05/2025Introduced: Rep. Debbie Dingell MI-06Sponsor: Latest Actions: 05/06/2025 - Referred to the Subcommittee on Water Resources and Environment. 05/05/2025 - Referred to the Committee on Science, Space, and Technology, and in addition to the Committee on Transp... 05/05/2025 - Referred to the Committee on Science, Space, and Technology, and in addition to the Committee on Transp... House Science, Space and Technology Committee, Committees: House Transportation and Infrastructure Committee, House Transportation and Infrastructure Committee Water Resources and Environment Subcommittee This report was created using POLITICO's Policy Intelligence Assistant. This report is for informational purposes only. The views and opinions presented do not necessarily reflect those of POLITICO LLC. 1 M E M O R A N D U M To: Orange County Sanitation District From: Townsend Public Affairs Date: November 21, 2025 Subject: November Legislative Monthly Report STATE UPDATES With the Legislature on Interim Study Recess, activity has shifted back to lawmakers’ districts. Members are meeting with constituents, hosting local events, and preparing for the next legislative session, which begins January 5, 2026. Voters Pass Proposition 50 On November 4, 2025, California voters approved Proposition 50 in a statewide special election, with the measure receiving approximately 64 percent support. Counties have until December 5 to submit their certified vote counts to the Secretary of State, who is scheduled to certify the final election results on December 12. Federal Lawsuit Filed Over California’s Post-Proposition 50 Redistricting Plan On November 13, the US Department of Justice (DOJ) announced they filed a lawsuit seeking to block California’s newly approved congressional district map, which was adopted under Proposition 50 for use in the 2026–2030 election cycles. The measure shifts responsibility for drawing congressional districts from the state’s independent redistricting commission to the Legislature, resulting in a redesigned map that could alter the political balance in several districts. The DOJ’s complaint argues that the map relied heavily on racial demographics, particularly the distribution of Hispanic voters, in ways that may violate the Equal Protection Clause and the Voting Rights Act. The lawsuit follows a separate challenge brought by the state’s Republican Party, which has also raised concerns about how the districts were drawn. The case introduces both legal and political uncertainties. Legally, it tests the boundary between permissible political considerations in redistricting and the constitutional limits on using race in the process. Politically, the outcome may influence competitive dynamics in upcoming congressional elections and shape how states approach redistricting in future cycles. Statewide Initiative Proposes Streamlined Project Review The California Chamber of Commerce recently submitted a proposed statewide initiative to the Attorney General’s Office seeking to modernize California’s environmental review process for major projects. The proposal, titled the Building an Affordable California Act, is designed to streamline approvals for “essential projects” such as housing, infrastructure, and public-service facilities, with the goal of improving affordability and reducing project delays. 2 The measure would establish defined timelines—generally up to one year—for state and local agencies to complete environmental reviews and issue final decisions on qualifying “essential projects,” including housing, renewable energy facilities, water and sanitation, broadband infrastructure, public health projects, municipal first responder facilities, and transportation improvements. If agencies fail to meet the proposed deadlines, applicants could request public hearings, and any legal challenges would be subject to expedited judicial review. Beyond addressing permitting delays, the initiative seeks to lower project costs, create jobs in construction and clean energy sectors, and advance infrastructure investments that promote housing affordability and economic growth. It also includes provisions ensuring that, if enacted, the measure will be legally defended on behalf of voters. If certified, the Building an Affordable California Act could appear on the 2026 statewide ballot, where voters would decide whether to adopt these proposed changes to California’s environmental and project approval framework. Delta Conveyance Project Update Governor Newsom and the California Department of Water Resources (DWR) announced two key milestones advancing the Delta Conveyance Project, a major water infrastructure effort intended to strengthen the State’s water supply and climate resilience. DWR submitted a certification of consistency to the Delta Stewardship Council, stating that the project complies with the Delta Reform Act and the State’s Delta Plan, which aim to balance environmental protection in the Sacramento–San Joaquin Delta with the need for a reliable water supply. In addition, the Third District Court of Appeal lifted a previous injunction, allowing DWR to resume pre-construction geotechnical work, including soil testing and subsurface investigations critical to project planning and design. Governor Newsom highlighted these developments as part of the Administration’s broader strategy to modernize California’s water infrastructure and prepare for the challenges of a changing climate. State officials emphasized that these steps are necessary to ensure long-term water reliability for millions of residents, while continuing to safeguard the Delta ecosystem and address the impacts of drought, flooding, and aging water systems. 1 | P a g e TO: Orange County Sanitation District FROM: Whittingham Public Affairs Advisors DATE: November 21, 2025 SUBJECT: Local Legislative Report Following are a few of the more notable developments and issues that have transpired in Orange County over the last several weeks: • The Cypress City Council held a special meeting on November 19 to interview seven finalists for potential appointment to replace former Council member Scott Minikus, who resigned from City Council October 1. • Multiple cities countywide continue to experience leadership changes. The Irvine City Council officially named Interim City Manager Sean Crumby as its new City Manager, while Cecilia Gallardo-Daly continues to serve as Interim City Manager in Costa Mesa. Looking forward, Newport Beach Assistant City Manager Seimone Jurjis will step into the City Manager role on January 1, 2026, succeeding Grace Leung, and Dana Point City Manager Mike Killebrew announced that he will be retiring as well at the end of the year. • Final negotiations are ongoing between the County of Orange and a coalition of cities and sanitation districts regarding landfill tipping fees, known as the Waste Infrastructure System Enhancements (WISE) agreements. Upon final approval by the Board of Supervisors (currently scheduled for December 2), each jurisdiction will work to complete their respective Prop 218 hearings and approve the rate increases prior to the new fees going into effect July 1, 2026. • The Anaheim City Council voted unanimously to increase sewer impact fees for new development in the Anaheim Hills area. The Council recently rejected a proposal to establish a 3 percent gate fee on various tourism destinations in the city, choosing instead to consider generating revenue from established sources. Per the staff report, the current sewer fee for a single-family home is $491; under the increase, the fee for a new single family home will be $667. 2 | P a g e • The South Coast Water District (SCWD’s) Board of Directors unanimously approved a Memorandum of Understanding (MOU) regarding a potential public agency to public agency partnership, wherein Orange County Waste & Recycling (OCWR) would generate renewable energy from the Prima Deshecha Landfill and provide it as a long-term power supply for SCWD’s Doheny Ocean Desalination Project. Prior to consideration of the MOU, a task force was formed between the staff of both agencies in 2022 and a corresponding report, entitled Assessment of Joint Opportunities to Benefit South Orange County Through Renewable Energy and Local Water Supply, was finalized in September 2025. The draft MOU was subsequently approved by the Board of Supervisors, and OCWR is also in discussions with other South County agencies about a similar partnership. • The Board of Supervisors also approved new rules that will enable Sheriff’s deputies to remove homeless encampments from County-owned property, including parks and flood control channels. Santa Ana, Anaheim, Irvine, Garden Grove, and Fullerton are among the cities that previously approved similar rules in the wake of the U.S. Supreme Court’s 2024 decision that enabled local jurisdictions to take such actions. As part of our scope of work, Whittingham Public Affairs Advisors has continued to monitor the various City Council agendas and highlighted issues and items of relevance to OC San. We also continue to monitor activities at the South Coast Air Quality Management District, Orange County Water District, and South Orange County Wastewater Authority. It is a pleasure to work with you and to represent the Orange County Sanitation District. Sincerely, Peter Whittingham 11/26/2025 1 FEDERAL UPDATE ER IC SAPIRSTE IN ENS RE SOURCES DECEMBER 10, 2025 1 PRESENTED TO: AD MIN IS T RA T I ON CO MMI TT E E ISSUES Legislative Priorities:Fiscal Year 2026 Budget, Water Infrastructure, Per- and polyfluoroalkyl substances (PFAS) Liability/BiosolidsManagement, Permit Reforms Regulatory–U.S. Environmental Protection Agency(U.S. EPA): PFAS LitigationRisk Assessment Model Looking Ahead 2 1 2 11/26/2025 2 LEGISLATIVE PRIORITIES: TODAY 3 Fiscal Year 2026 Appropriations U.S. EPAInfrastructure PFAS Funding—Technologies Reductionsin Force—Mandate to Rehire Furloughed Workers January 30, 2026 Deadline Water Infrastructure Clean Water Act StateRevolvingLoanFund/Water Infrastructure Finance and Innovation Act Wastewater Infrastructure Pollution Prevention and Environmental Safety (WIPPES) Act(Flushable Wipes) Permit Reforms PFAS HazardousSubstanceComprehensive Environmental Response, Compensation, and Liability Act DesignationProtection REGULATORY PRIORITIES-U.S. EPA 4 Draft Risk Assessment Model Review and Finalization Status: 24,000 Public Comments InterimGuidance Treatment and Disposal Survey Effluent Limitations Guidelines Administrator Lee Zeldin and Office of Water Views Looking Forward 3 4 11/26/2025 3 LOOKING AHEAD: 2026 LEGISLATIVE AGENDA 5 Appropriations February –WhiteHouseFiscalYear2027BudgetRequest March– NovemberCongressionalReview November–ContinuingResolution PFASLiability Protections WIPPESAct 10Year National PermitDischarge Elimination Terms WaterInfrastructure Clean WaterAct WaterInfrastructureModernization Act CaliforniaWater MID-TERM ELECTION IMPLICATIONS House Majority Outlook Senate Majority Outlook Redistricting Impacts on OC San Impact on Legislative Activity 5 6 11/26/2025 4 7 7 ADMINISTRATION COMMITTEE Agenda Report Headquarters 18480 Bandilier Circle Fountain Valley, CA 92708 (714) 593-7433 File #:2025-4633 Agenda Date:12/10/2025 Agenda Item No:7. FROM:Robert Thompson, General Manager SUBJECT: PUBLIC AFFAIRS STRATEGIC PLAN FOR FISCAL YEARS 2024-2026 MID-YEAR UPDATE GENERAL MANAGER'S RECOMMENDATION RECOMMENDATION: Receive and file the Public Affairs Strategic Plan for Fiscal Years 2024- 2026 Mid-Year Update. BACKGROUND The Orange County Sanitation District’s (OC San)Public Affairs Office is responsible for creating, organizing,and disseminating all internal and external communication.The primary objective of the Public Affairs team is to deliver messages that are accurate,transparent,and designed to foster trust and confidence.An integrated Public Affairs Strategic Plan is essential to effectively manage the variety of audiences served. RELEVANT STANDARDS ·Build brand, trust, and support with policy makers and community leaders ·Maintain collaborative and cooperative relationships with regulators,stakeholders,and neighboring communities ·Make it easy for people to understand OC San’s roles and value to the community ·Maintain influential legislative advocacy and a public outreach program PROBLEM There are various initiatives and messages that the Public Affairs Office must share with internal and external stakeholders for continued operation and efficiency of OC San.The messaging must be consistent, concise, and thoroughly planned to be efficient and effective. PROPOSED SOLUTION The Public Affairs team has developed a plan to span fiscal years 2024-25 and 2025-26,in support of OC San’s adopted two-year budget.The Public Affairs Strategic Plan includes goals,objectives, strategies,and tactics to execute the various messages and efforts set forth by OC San’s Strategic Plan and the General Manager’s Work Plan.The two-year plan commenced July 1,2024,and updates are provided to the Administration Committee every six months. Orange County Sanitation District Printed on 12/2/2025Page 1 of 4 powered by Legistar™ File #:2025-4633 Agenda Date:12/10/2025 Agenda Item No:7. PRIOR COMMITTEE/BOARD ACTIONS June 2024 -Board and Steering Committee received and filed the Public Affairs Strategic Plan for Fiscal Years 2024-2026. December 2024 - Public Affairs Strategic Plan for Fiscal Years 2024-2026 Mid-Year Update July 2025 - Public Affairs Strategic Plan for Fiscal Years 2024-2026 Year-End Update ADDITIONAL INFORMATION OC San’s Public Affairs Office Strategic Plan for Fiscal Years 2024-2026 (Plan)was developed based upon the principles of OC San’s mission of protecting public health and the environment and to support the implementation of OC San’s Strategic Plan.This Plan offers a vision to unify communication efforts and focus resources to achieve the greatest impact and greatest results.The Plan consists of 11 categories. Below is a recap of the last six months of the second year of the plan. ·Employee Engagement Goal: Optimize communication with internal audience including those operating in the field. o Posted 275 The San Box Posts (intranet) o Distributed 26 Three Things to Know Emails (weekly email) o Published Three (3)Pipeline issues o Hosted Five (5) employee events o Distributed 44 New Employee Welcome kits ·Industry Experts Goal:Establish and solidify OC San’s reputation as infrastructure leaders in the wastewater and resource recovery industry. o Received 16 awards o Participated in eight (8) speaking engagements reaching over 400 people ·Media Relations Goal: Cultivate relationships with traditional and social media journalists and influencers. o Issued two (2) press releases o Published 298 social media posts across five platforms including ads reaching over 143k people o Increased our followers by 635 ·Agency Branding and Messaging Goal:Enhance OC San’s image and branding by utilizing proper messaging in external communication pieces such as OC San’s website,presentations,digital media,advertising, which includes maintaining a positive experience for OC San visitors. o Published one (1)issue of OC San Connection Newsletter reaching over 3,300 subscribers Orange County Sanitation District Printed on 12/2/2025Page 2 of 4 powered by Legistar™ File #:2025-4633 Agenda Date:12/10/2025 Agenda Item No:7. o Published 31 articles on the OC San website o Completed 67 graphic design projects ·Educational Outreach Goal:Identify and implement avenues for education and outreach within OC San’s service area to promote OC San’s mission and vision. o Hosted 52 tours reaching over 913 people o Participated in six (6) community events reaching over 1,000 people o Completed the Headquarters Educational Display- Phase 2 o Completed the sixth session of Wastewater 101 Citizens Academy with 42 graduates ·Capital and Maintenance Outreach Goal:Develop and implement outreach programs that will engage the communities affected by OC San construction and maintenance activities. o Distributed ten printed notifications reaching over 29,000 people o Issued 24 electronic messages o Held various meetings with project stakeholders §City of Cypress- Traffic Commission Presentation §City of Los Alamitos- City Council Presentation §City of Los Alamitos- City Manager and Public Works Director §Newport Beach- Bayside Village HOA Meeting §Newport Beach- Linda Isle HOA Meeting ·Legislative Affairs Goal:Proactive engagement in legislative advocacy efforts that could impact OC San and the wastewater industry. o Developed the 2026 Legislative and Regulatory Plan o Issued two (2) State position letters o Joined in one (1) Federal Position coalition letter ·Grants Coordination Goal: Monitor, track, and apply for grants available to OC San. o Continued support of the $3.45 million in community project funding for the Supercritical Water Oxidation Project. ·Local Government Affairs Goal:Ensure that local elected officials,member agencies,stakeholders,and OC San Board Members are actively engaged in the work of OC San. o Issued monthly Board Member Speaking Points o Developed OC San’s Annual Report o Hosted in-person State of OC San with 155 participants o Published six “Five Minutes Per Month” o Produced and distributed two (2) member-agency outreach toolkits ·Crisis Management Goal:Ensure the Public Affairs Office serves as the primary spokesperson for OC San during Orange County Sanitation District Printed on 12/2/2025Page 3 of 4 powered by Legistar™ File #:2025-4633 Agenda Date:12/10/2025 Agenda Item No:7. normal business and crisis scenarios and facilitates the dissemination of information. o Continued monitoring and updating Public Affairs Office’s Continuity of Operations Plan ·General Manager Support Goal:Ensure the General Manager and Assistant General Manager are supported with information necessary to communicate to the varied OC San audiences. o Developed six (6) General Manager Monthly Reports o Prepared Monthly talking points o Developed material for speaking engagements and presentations FINANCIAL CONSIDERATIONS All items included in the Public Affairs Strategic Plan FY 2024-2026 are budgeted in the FY 2024- 2026 Budget. ATTACHMENT The following attachment(s)may be viewed on-line at the OC San website (www.ocsan.gov)with the complete agenda package: ·Public Affairs Strategic Plan, FY 2024-2026 ·Presentation Orange County Sanitation District Printed on 12/2/2025Page 4 of 4 powered by Legistar™ PAO Strategic Plan FY 2024-26 June 2024 1 Public Affairs Strategic Plan FY 2024-2026 Introduction The Orange County Sanitation District’s (OC San) Public Affairs Office (PAO) is responsible for managing all internal and external communications. The PAO's main goal is to ensure messages are accurate, transparent, and build public trust and confidence. An integrated Public Affairs Strategic Plan is essential for effectively addressing the diverse audiences we serve. The PAO offers services, tools, and programs to meet OC San’s communication needs. This includes media relations, website and intranet site content, construction outreach, elected officials and government relations, internal communications, education, outreach, and graphic development. The PAO has developed a Strategic Plan (Plan) for Fiscal Years 2024 - 2026. This Plan is developed based upon the principles of OC San’s Mission of protecting public health and the environment and will support the implementation of OC San’s Strategic Plan. This Plan offers a vision to unify our communication efforts and focus resources to achieve the greatest impact and greatest results. Because much of what is planned and created by this group is based on external factors and therefore outside of our control, flexibility and fluidity is integrated into the Plan. The PAO will follow the guidance set forth by management and the Board of Directors to carry out OC San’s messaging and support our member agencies. Background Information OC San represents 20 cities, 4 special districts, and a portion of the unincorporated County of Orange. This area represents a community of 2.6 million people with approximately 550,000 customer accounts. Unlike most public agencies where there is direct contact with customers, OC San’s billing occurs through the County of Orange property tax bills. Therefore, OC San must work through other means to communicate with the public and the rate payers. We have a 25-member Board of Directors, and more than 650 employees within six departments with various goals and objectives. While these groups work independently on a variety of projects, the goal of the PAO is to provide support and messaging that is consistent throughout the agency so that we are one voice, representing the same overall goals, and portraying the same brand. PAO Strategic Plan FY 2024-26 June 2024 2 There are many challenges with serving such a large and diverse customer base, however; there are also great opportunities working through the strategies laid out in this Plan. Public Affairs Team The division is staffed with seven full-time employees and overseen by a supervisor and a department head. Jennifer Cabral, Director of Communications Daisy Covarrubias, Public Affairs Supervisor Rebecca Long, Senior Public Affairs Specialist Belen Carrillo, Senior Public Affairs Specialist Kelly Newell, Public Affairs Specialist Public Affairs Specialist – Vacant Gregg Deterding, Graphics Designer Isai Carrillo, Graphics Designer Cheryl Scott, Administrative Assistant Each of these team members carry out specific functions to meet the communication goals and objectives laid out in this Plan. Situation Analysis • OC San approved a five-year rate program in 2023. Public communication must account for the financial impact on OC San ratepayers as decisions and proposed fees for the next five years are developed and communicated. • OC San must continue to attract talented and qualified personnel to fill vacancies. Effectively communicating OC San’s culture and emphasizing the importance of professional relationships is essential to the effectiveness and functionality of the agency. • OC San will have new Board leadership and is anticipating a high turnover post the November 2024 election. Continuous engagement with the Board of Directors will be critical for the success of this agency. PAO Strategic Plan FY 2024-26 June 2024 3 • As an essential service, OC San has continued to execute the Capital Improvement Program (CIP) to keep the regional projects on schedule, improving and maintaining the regional sewer system throughout the service area. In the next two fiscal years, OC San plans to award 38 construction contracts worth a total of $340 million. • OC San administrative staff have moved into a new Headquarters across the street from Plant No. 1, in Fountain Valley. The new building houses over 300 staff members that were previously spread across 10 buildings. Internal communications and engagement will need to become a greater focal point to ensure OC San’s culture remains positive between staff located at the Plants, and staff at Headquarters. Mission The Public Affairs Office is committed to communicating information about OC San in a timely, accurate and accessible way to the employees, the Board of Directors, our member agencies, elected officials, the public, and the news media. • We are committed to open, honest, clear, and respectful two-way communication with our audiences. • We are dedicated to informing others about how OC San serves the public and protects the environment. • We are committed to outstanding customer service by responding to requests quickly and efficiently. • We are dedicated to teamwork and collaboration as well as being creative and taking the initiative to be out in front of issues. Audiences This Public Affairs Plan focuses largely on four primary audiences. • Internal o Board of Directors o Executive Management Team o Employees o Retirees • The Public o Ratepayers o Member Agencies o Residents, Businesses, Commuters Impacted by OC San Construction and Maintenance PAO Strategic Plan FY 2024-26 June 2024 4 o OC San Neighbors near our facilities (plants and pump stations) o Schools and Students o Tour Groups • Industry o Water/Wastewater Agencies o Trade Organizations o Trade Media o Contractors and Consultants • Influential Public o Local, State, and Federal Elected Officials o Environmental Groups o Local Media Agency Key Messages • OC San is committed to protecting public health and the environment by providing effective wastewater collection, treatment, and recycling. • OC San is more than a wastewater treatment facility; we are a resource recovery facility making use of all our byproducts. • OC San is dedicated to exceeding wastewater quality standards used for resource recovery. • OC San is committed to proper planning to ensure that public funds are wisely spent. • OC San’s assets are monitored and evaluated regularly to ensure top performance and timely replacement. • OC San values communicating our mission and strategies with those we serve and all other stakeholders. • OC San provides an essential service to 2.6 million people at one of the lowest rates in the state. • Providing reliable, responsive, and affordable services in line with our customer needs and expectations is a top priority for OC San. • OC San is committed to creating the best possible workforce, prioritizing safety, productivity, customer service, and training. PAO Strategic Plan FY 2024-26 June 2024 5 • OC San has diligently developed an integrated planning environment that starts with the Board of Directors’ expectations and extends to each employee’s work product. We strive to ensure our staff members communicate effectively and provide transparent services to support the Plan. • OC San has developed an integrated Planning/Asset Management system that allows for intentional, thoughtful decision making to maintain current operations while adding resilience and meeting new challenges. • OC San’s organizational structure includes informal relationships between employees that facilitate collaboration toward common goals. Public Affairs’ Goals for Fiscal Year 2024/25 and 2025/26 1. Optimize communication with our internal audience. 2. Continue to build OC San’s reputation as leaders in the wastewater and resource recovery industry. 3. Cultivate relationships with traditional and social media journalists and influencers to promote OC San’s programs and initiatives. 4. Enhance OC San’s image and branding by utilizing proper messaging in external communication pieces such as OC San’s website, presentations, digital media, and advertising. Maintain a positive experience and image for our visitors. 5. Identify and implement avenues for education and outreach within OC San’s service area to further promote OC San as a resource recovery agency, our mission, and career opportunities within the wastewater industry. 6. Educate and inform the public on the various OC San initiatives aimed to protect the environment such as What 2 Flush; Fats, Oil, and Grease; and any other necessary message. 7. Develop and implement outreach programs that will engage the communities affected by OC San’s construction projects. 8. Ensure proactive engagement in legislative advocacy efforts that could impact OC San and the wastewater industry. 9. Monitor, track, and apply for grants available and that make business sense to OC San. 10. Ensure that elected officials, member agencies, stakeholders, and OC San Board Members are actively engaged in the work of OC San. 11. Ensure the Public Affairs Office serves as the primary spokesperson for OC San during normal business and crisis scenarios and facilitates the dissemination of information. PAO Strategic Plan FY 2024-26 June 2024 6 To achieve these goals, PAO outlines the following strategies and tactics, along with the primary staff assigned to each area. Although individual staff members are the key contacts for each of the goals, the team works collectively and collaboratively, reflecting our core values. Our staff acknowledges the key role we play at OC San, not only communicating information, but also educating, consulting, and serving as a resource to our Board of Directors, employees, the wastewater industry, our member agencies, and our community. Flexibility is implemented into this plan to deal with unexpected situations and circumstances. Public Affairs Strategies and Tactics 1. Category: Employee Engagement Program Lead: Rebecca Long Program Coordinator/Support: Kelly Newell, Gregg Deterding, Isai Carrillo, and Cheryl Scott Goal (what): Optimize communication and engagement with our internal audience to include both field staff and administrative staff. Objective (measure): Establish a base line of current engagement by tracking access and participation from the identified tactics. Strategy (why): We value open and honest communication with our employees. PAO is committed to various efforts aimed at keeping OC San employees informed about important topics, increasing the overall quality of communications to our employees while tying the business aspects of the agency with the human-interest side. Tactics (how): • Keep information on The San Box current, relevant, and useful for OC San employees by working with the various departments to gather information that should be shared. • On a regular basis, staff will continue to support various departments with their communication and outreach needs. • PAO will produce six Pipeline newsletters per year with a goal of circulation by the third week of the publication month. • Incentivize employees to educate and inform the public of OC San’s essential service through the Volunteer Incentive Program (VIP) by issuing points for all volunteer hours. • Create employee recognition and celebratory events throughout the year, this may include small in-person gatherings and virtual events. To include but not limited to the Annual Holiday Lunch, the Harvest Festival, and VIP Celebration, etc. • Continue with the Honor Walk program which acknowledges retired staff and past Board Members for their contribution to OC San. The recognition event will be hosted every other year starting in 2025. PAO Strategic Plan FY 2024-26 June 2024 7 • Write and coordinate the 3 Things to Know email blast to be distributed to all staff each Monday. • Support and promote OC San “U”, OC San’s training program. • Create “New Employee Welcome Kit” to be distributed on employees first day of work to introduce employees to the OC San culture, include electronic communication with key messages and link to important information. • Create and implement an employee engagement audit to assess the value of the information shared, the method used, and feedback on OC San’s culture. o Conduct periodic surveys following employee events to allow for improvements and/or modifications. • Implement an employee art contest using OC San’s infrastructure. 2. Category: Industry Experts Program Lead: Kelly Newell Program Coordinator/Support: Public Affairs Specialist, Gregg Deterding, Isai Carrillo, and Cheryl Scott Goal (what): Establish and solidify OC San’s reputation as infrastructure leaders in the wastewater and resource recovery industry. Objective (measurable): Increase participation in strategic organizations through conferences, networking activities and awards by five percent. Strategy (why): To build positive public perception and confidence among our various audiences. Tactics (how): • Encourage participation and presentation in conferences. • Encourage and support award application submittals. • Publicize and coordinate award acceptance logistics. • Track all awards won by OC San by keeping a master list. • Track and promote staff abstracts, and publications. 3. Category: Media Relations Program Lead: Rebecca Long Program Coordinators: Kelly Newell, Belen Carrillo, Gregg Deterding, and Cheryl Scott Goal (what): Cultivate relationships with traditional and social media journalists and influencers. PAO Strategic Plan FY 2024-26 June 2024 8 Objective (measurement): Track and increase media coverage with positive stories about OC San. Strategy (why): While a presence in the community is important to putting a face to our agency, media (traditional and social) is equally important with a broader reach and a more direct line of communication. Tactics (how): • Annually update media list to stay current and fresh. • Maintain a digital press kit. • Build a calendar of news release topics of interest to the public and stakeholders. • Invite media for a facility tour, including traditional and non-traditional media. • Develop media strategies for important events, decisions, or actions. e.g. CIP Campaign (see details in Category 6: Capital and Maintenance Outreach • Weekly (3-5 times) social media posts about the happenings at OC San with focus on OC San’s accomplishments and mission. • Continue with social media campaigns # #OCSanCareers, #What2Flush, and those currently supporting ongoing efforts. 4. Category: Agency Branding and Messaging Program Lead: Belen Carrillo Program Coordinators/Support: Gregg Deterding, Isai Carrillo, Kelly Newell, Public Affair Specialist, and Cheryl Scott Goal (what): Enhance OC San’s image and branding by utilizing proper messaging in external communication pieces such as OC San’s website, presentations, digital media, advertising, which includes maintaining a positive experience for OC San visitors. Objective (measure): Continue with OC San’s branding campaign including updating collateral material, signage, and promotional material as appropriate and as it is used. Maintain the lobby(s) current and informative with relevant information, i.e., displays, awards case, etc. Strategy (why): A cohesive voice, message, look, and feel are critical to the public perception that an organization holds with its community. A positive and pleasant in-person experience reinforces OC San’s culture and core values as well as showcasing OC San as industry leaders, and a well-run organization, leaving behind the stigma of typical government agencies. Tactics (how): • Develop new website to better meet the information needs of our visitors while meeting accessibility standards. PAO Strategic Plan FY 2024-26 June 2024 9 • Maintain website accuracy, relevancy and timeliness with new stories posted weekly. • Provide presentations, consultation, and advice on the branding and image of OC San. • Develop new collateral materials around the key messages. • Explore advertising options to inform the public of agency efforts and role in enhancing the local economy. • Fulfill all requests for graphics, photos, and logos. • Continue with online community newsletter. Increase reach and distribution list. • Update and maintain signage across OC San facilities. • Develop a Board approved design for the hands-on educational display for the outdoor patio. • Maintain the lobby wall in the Operations Center at Plant No. 2 with OC San’s current branding and messaging and implement lobby display at the Headquarters. • Rotate flags on light poles at Plant No. 1 and at Plant No. 2 on a biennial basis. • Keep the award display up to date by rotating awards. • Install a retiree display in the Headquarters and keep it up to date. • Maintain and coordinate the installation of Honor Walk bricks on a biennial basis. • Display collateral material in a neatly and organized manner displayed with current and relevant information. • Update a video library of OC San programs to utilize as educational and promotional tools. • Promote implementation of OC San’s permittee awards program that recognizes industries for improving their adherence to excellent standards and expand to recognize multi-year awardees. Identify methods to include waste haulers in recognition system. 5. Category: Educational Outreach Program Lead: Belen Carrillo Program Coordinators/Support: Kelly Newell, Public Information Specialist, Gregg Deterding, Isai Carrillo, and Cheryl Scott Goal (what): Identify and implement avenues for education and outreach within OC San’s service area to promote OC San’s mission and vision. Objective (measurement): Create and identify new educational opportunities including virtual events and webinars to promote and educate the community on OC San’s work and the essential service provided. Strategies (why): To further promote OC San as a resource recovery agency, promote OC San’s mission and promote career opportunities within the wastewater industry. Tactics (how): PAO Strategic Plan FY 2024-26 June 2024 10 • Execute the Inside the Outdoors contract for Fiscal Year 2025-2026 to continue the educational partnership that includes the Sewer Science program to 500 students within Orange County and introduce them to OC San’s virtual tour program. • Revise plant tours to incorporate Headquarters. • Identify 8-10 community event opportunities for OC San to participate in to inform and educate the community on the important role OC San plays in public health and the environment. • Expand OC San’s speaker’s bureau to provide a wider set of speakers available. • Continue hosting Wastewater 101 Citizen Academy for our ratepayers, and influential public to showcase OC San operations and initiatives. Host one session with four classes per year. • Support the Heritage Museum of Orange County’s educational efforts by supplying material to be used for virtual and in-person teaching of OC San’s key messages. • Connect with OC San service area libraries to identify possible OC San program collaboration and implementation opportunities that would aim to. highlight selected OC San messaging points such as What 2 Flush, the wastewater treatment process, and career opportunities. 6. Category: Capital and Maintenance Outreach Program Leads: Belen Carrillo and Tanya Chong from Engineering, Program Coordinators/Support: Kelly Newell, Public Affairs Specialist, Rebecca Long, Gregg Deterding, Isai Carrillo, Cheryl Scott, Goal (what): Develop and implement outreach programs that will engage the communities affected by OC San construction and maintenance activities. Objective (measurement): Develop, implement, and provide outreach support for over 10 capital projects scheduled to break ground in fiscal years 2024/2025 and 2025/2026 in more than 10 cities. Strategy (why): Form a positive presence in the community prior to the start of construction projects or maintenance activities that is personal and proactive. Provide impacted community with information ahead of construction activities. Inform them of the benefits and need for the project to gain support and understanding of the necessary construction. Tactics (how): • Proactively offer briefings and community meetings to impacted neighborhoods, civic groups, businesses, schools, churches, and other institutions within the project area on an as needed basis. PAO Strategic Plan FY 2024-26 June 2024 11 • Explore the option of placing advertising pieces in communities/areas impacted by construction. • Respond to inquiries within a 24-hour period. • Provide project description and notifications to impacted residents at least two weeks before construction begins. • Update collateral materials, fact sheets and website with current construction information on an as needed basis. • Maintain ongoing communications with city staff and Board Members on current and upcoming construction outreach projects in affected cities. • Maintain ongoing communications with impacted residents within the project area through collateral material (e.g., flyers, door hangers, emails, text alerts, social media posts, etc.). • Measure customer satisfaction through a construction outreach survey to be distributed at the close of construction programs. • Provide outreach program training for the engineering team to help them understand the outreach program, the role of the community liaison and benefits to project. • Implement a multipronged outreach strategy that will include industry and media coverage for the Supercritical Water Oxidation project. 7. Category: Legislative Affairs Program Lead: Rebecca Long Program Coordinator/Support: Kelly Newell, Public Affairs Specialist, and Cheryl Scott Goal (what): Proactive engagement in legislative advocacy efforts that could impact OC San and the wastewater industry. Objective (measure): Continue positive relationships with local, state, and federal officials through facility tours, meetings, and bill tracking as stated in the Legislative Plan. Strategy (why): Legislative advocacy is an important aspect of our business. Having relationships and being actively involved, providing input and OC San’s perspective on potential legislature can and does directly affect OC San and our business. The PAO is responsible for executing the Board approved Legislative Plan, which is updated on an annual basis. In addition, staff is responsible for tracking state and federal legislation, managing OC San’s legislative advocates, and seeking appropriations and grants. Tactics (how): • Develop and implement Annual Legislative Plan in the second quarter of each fiscal year. PAO Strategic Plan FY 2024-26 June 2024 12 • Track bills and maintain a priority list of key legislation. • Provide regular updates to the Legislative and Public Affairs Committee on state and federal matters. • Host legislative tours. • Engage in Advocacy Days in Sacramento and Washington DC as needed. • Take positions on bills that could affect OC San or the industry. • Work with industry organizations on state and federal issues to ensure OC San’s positions are communicated. • Partner with industry organizations to co-host virtual events and activities. • Manage the legislative advocates’ contracts and facilitate regular communication between lobbyists, staff, and the Board of Directors. 8. Category: Grants Coordination Program Lead: Rebecca Long Program Coordinator/Support: Kelly Newell, Public Affairs Specialist, and Cheryl Scott Goal (what): Monitor, track, and apply for grants available to OC San. Objective (measure): Apply and obtain grants for qualified OC San projects and programs. Strategy (why): Outside funding is important in moving OC San projects and programs forward. With ongoing attention to government spending, it is vital for OC San to apply for and secure grants to offset costs when available. Tactics (how): • Apply for two grants a year based on availability. • Ensure Grant Policy is updated and current. • Research grant opportunities and report out to the Legislative and Public Affairs Committee. • Seek out available grant funding opportunities for OC San and its various divisions. • Secure letters of support. • Publicize grant awards received. • Create and measure outcomes. 9. Category: Local Government Affairs Program Lead: Rebecca Long and Belen Carrillo Program Coordinators/Support: All PAO staff Goal (what): Ensure that local elected officials, member agencies, stakeholders, and OC San Board Members are actively engaged in the work of OC San. PAO Strategic Plan FY 2024-26 June 2024 13 Objective (measure): Provide at least two communication tools per month. Strategy (why): Keeping OC San’s influential public engaged in OC San’s projects and accomplishments are critical to the support and success of our agency. Tactics (how): • Provide Board of Directors with speaking points following every OC San board meeting that can be used when reporting back to their respective councils and community groups. • Support an orientation (as needed) for new Board members. • Develop and keep a current list of monthly informational presentations. • Maintain an informational presentation video library for the Board of Directors on key agency topics. • Provide regular reports to the Steering Committee. • Develop OC San’s Annual Report. • Publish a Five Minutes Per Month, each month. • Participate in government affairs committees. • Invite new council and board members within OC San’s service area to take a tour of OC San and offer presentations to their respective agencies on OC San programs and efforts. • Create and distribute quarterly outreach tool kits for member agency PIOs to help them easily share and disseminate information about OC San. • Host a “State of OC San” event for influential leaders throughout the infrastructure and water/wastewater industry, including virtual option. 10. Category: Crisis Management Program Lead: Rebecca Long Program Coordinators/Support: All PAO Staff Goal: Ensure the PAO serves as the primary spokesperson for OC San during normal business and crisis scenarios and facilitates the dissemination of information. Objective: Ensure that the PIOs in the PAO can respond in a crisis. Provide the necessarily tools and material to follow established protocols and support the situation as needed. Strategy: It is imperative during a crisis that OC San be proactive and provide clear and effective messaging to employees, public, and the media. PAO Strategic Plan FY 2024-26 June 2024 14 Tactics (how): • Maintain an updated crisis communication plan including regular briefings with staff to identify possible issues and responses. • Maintain and update PAO’s Continuity of Operations Plan (COOP). • Work with Risk and Safety Management on Public Affair’s role in an emergency, including our role via the Integrated Emergency Response Plan. • Ensure proper procedures are in place for Board, employees, and public notification. • Maintain updated contact lists for resource, member, and partnering agencies to coordinate and assist during crisis. • Develop protocols on everyday PAO tasks to facilitate the operations of the group in a time of crisis. 11. Category: General Manager Support Program Lead: Daisy Covarrubias / Rebecca Long Program Coordinators/Support: All PAO Staff Goal: Ensure the General Manager and Assistant General Managers are supported with information necessary to communicate to the varied OC San audiences. Objective: Develop monthly communication pieces on behalf of the General Manager. Ensure General Manager (or designee) is participating and involved in promoting OC San’s initiatives. Strategy: Collaborate with the General Manager to prepare communication and messaging that reflects the mission and vision of OC San. Tactics (how): • Assist the General Manager and the Assistant General Managers with keeping the Board Members informed and up to date with OC San activities. • Assist in the development of the General Manager’s Monthly Report. • Develop talking points for Board and Committee meetings. • Develop material and speaking points for presentations and speaking engagements. • Support the development of the OC San Strategic Plan. • Assist in the development of the General Manager’s Annual Work Plan, including mid- year and end of year reports. • Manage Ask the GM questions submitted. • Coordinate and support VIP tours guided by General Manager and Assistant General Manager. • Coordinate and produce annual All Hands meetings (live and/or pre-recorded) to keep employees informed and engaged. PAO Strategic Plan FY 2024-26 June 2024 15 Closing Comments This plan is a broad outline of the Public Affairs Office program. As new issues arise, new functions and duties will evolve as well. The role of the Public Affairs Office is to stay ahead of issues, be responsive and flexible to meet the needs of the agency. We will adjust our program accordingly. New Tactics Introduced • OC San new website – In progress • Library Educational Program • Headquarters Educational Display – Phase 2 • Library Educational Program • Video Library Update • Employee Engagement Audit • New Employee Welcome Kit • Employee Art Contest 12/2/2025 1 Public Affairs Strategic Plan for Fiscal Years 2024-2026 Mid-Year Update Presented by: Daisy Covarrubias, Public Affairs Supervisor Administration Committee Meeting December 10, 2025 2 •Employee Engagement •Industry Experts/Media Relations •Agency Branding •Educational Outreach •Construction Outreach •Legislative Affairs & Local Government Affairs •New Initiatives Public Affairs Programs 1 2 12/2/2025 2 3 Employee Engagement Employee Engagement •275 The San Box Posts •26 Three Things to Know Emails •5 employee events •3 Pipeline issues •44 New Employee Welcome kits 4 Industry Experts/Media Relations Media •298 social media posts •635 new followers Industry Experts •16 awards received •8 public speaking engagements 3 4 12/2/2025 3 5 Agency Branding Agency Branding •1 Community Connection newsletter •31 website articles •67 design projects 6 Educational Outreach Education •6 community events •52 tours reaching over 900 people •Completed Headquarters Educational Display – Phase 2 •6th session of WW 101 -42 Graduates 5 6 12/2/2025 4 7 Construction Outreach Construction •10 printed notices reaching over 29,000 people •24 electronic messages •31 social media posts •8 Nextdoor Posts with over 83,000 impressions 8 Legislative and Government Affairs Govt. Affairs State of OC San Annual Report Quarterly Outreach Toolkits Legislative 2 position letters 2026 Legislative Plan GM Support Monthly Memo Work Plan Talking Points Presentations Strategic Plan DC1 7 8 12/2/2025 5 9 •Video Library •Library Education Program •Employee Art Contest •Construction Outreach •Community Engagement What’s Next 10 Recommendation to the Board of Directors to: •Receive and File the Public Affairs Strategic Plan for Fiscal Years 2024-2026 Mid-Year Update. Recommendation 9 10 12/2/2025 6 Questions? 11 11 ADMINISTRATION COMMITTEE Agenda Report Headquarters 18480 Bandilier Circle Fountain Valley, CA 92708 (714) 593-7433 File #:2025-4583 Agenda Date:12/10/2025 Agenda Item No:8. FROM:Robert Thompson, General Manager Originator: Laura Maravilla, Director of Human Resources SUBJECT: ADDITIONAL POSITION REQUESTS FOR FISCAL YEAR 2025-26 GENERAL MANAGER'S RECOMMENDATION RECOMMENDATION: Recommend to the Board of Directors to: Approve the addition of five (5) new positions and the upgrade of one (1) position for FY 2025-2026 as follows: A.Add two (2) Engineering Supervisors (Salary Grade SUP92); B.Add one (1) Senior Engineer (Salary Grade PRO88); C.Add one (1) Engineer (Salary Grade PRO84); D.Add one (1) Senior Planner/Scheduler (Salary Grade PRO84); and E.Upgrade one (1) Contract/Purchasing Technician (Salary Grade OCE67) to Buyer (Salary Grade PRO70). BACKGROUND The Orange County Sanitation District (OC San)evaluated staffing levels and identified the need for additional positions,and position changes to support expanding operational requirements,service delivery, and key organizational initiatives. The additional positions in Engineering,include:two (2)Engineering Supervisors,a Senior Engineer, and an Engineer are part of the Capital Improvement Program (CIP)staffing plan presented to the Board of Directors in October 2025.The staffing plan outlined the long-term staffing needs to support the steady growth in engineering projects over the next 10 years,and the shift from the current Supplemental Engineering Services model toward a direct hiring model to support the existing CIP execution. The additional Senior Planner/Scheduler position is slated to be assigned to the Financial Management Division,thereby creating a structurally independent resource to provide accurate cost and schedule reporting,increased accountability and better alignment with best practices for CIP Orange County Sanitation District Printed on 12/3/2025Page 1 of 3 powered by Legistar™ File #:2025-4583 Agenda Date:12/10/2025 Agenda Item No:8. oversight. Lastly,staff is requesting the upgrade of a Contract/Purchasing Technician position to a higher-level Buyer classification to support the current workload of the division,which demands higher-level decision-making and specialized qualifications. RELEVANT STANDARDS ·Ensure the public’s money is wisely spent ·Maintain a culture of improving efficiency to reduce the cost to provide the current service level or standard PROBLEM Organizational staffing needs have arisen that were not anticipated in preparation of the adopted FY 2025-26 budget. PROPOSED SOLUTION Approve the proposed position requests for FY 2025-26 to include five (5)new positions and one (1) position upgrade,to take effect immediately.Adding the positions now will allow for the recruitment process to begin so the resources will be in place when the new fiscal year begins. TIMING CONCERNS Staff recommends approval of the position requests during the current fiscal year to address the identified staffing gaps. RAMIFICATIONS OF NOT TAKING ACTION Deferring action on the requested position additions and upgrade would require existing staff to absorb the increased workload and would limit OC San’s ability to assign resources at the appropriate level to support operational and business needs. PRIOR COMMITTEE/BOARD ACTIONS N/A ADDITIONAL INFORMATION OC San’s Board approved Fiscal Year 2025-26 budget included a total of 664.5 full-time employees (FTE). The proposed position requests would change the approved FTE total to 669.5. CEQA N/A Orange County Sanitation District Printed on 12/3/2025Page 2 of 3 powered by Legistar™ File #:2025-4583 Agenda Date:12/10/2025 Agenda Item No:8. FINANCIAL CONSIDERATIONS The FY 2025-26 Budget provides sufficient funding for the recommended action,with the associated costs of $272,000 to be offset by savings generated from positions that may remain unfilled through normal attrition. ATTACHMENT The following attachment(s)may be viewed on-line at the OC San website (www.ocsan.gov)with the complete agenda package: N/A Orange County Sanitation District Printed on 12/3/2025Page 3 of 3 powered by Legistar™ ADMINISTRATION COMMITTEE Agenda Report Headquarters 18480 Bandilier Circle Fountain Valley, CA 92708 (714) 593-7433 File #:2025-4636 Agenda Date:12/10/2025 Agenda Item No:9. FROM:Robert Thompson, General Manager Originator: Wally Ritchie, Director of Finance SUBJECT: PAYMENT AGREEMENT FOR CHARGES AND FEES OWED BY COLOR FASHION DYE AND FINISHING, LLC INDUSTRIAL WASTEWATER DISCHARGE PERMITTEE GENERAL MANAGER'S RECOMMENDATION RECOMMENDATION: Recommend to the Board of Directors to: Approve the Payment Agreement for charges owed for user fees with Color Fashion Dye &Finishing, an Industrial Wastewater Discharge Permittee,in the amount of $114,848.28,pending receipt of acceptable payment security. BACKGROUND Color Fashion Dye &Finishing,LLC is the holder of an industrial wastewater discharge permit issued by the Orange County Sanitation District (OC San)that requires payment of user fees for the cost of conveying,treating,and disposing of wastewater discharged.Based on the terms of the permit,the permittee is required to pay estimated quarterly sewer service charges that are reconciled annually with actual discharge flows and strength.The permittee (Color Fashion Dye &Finishing)is delinquent and has a current total balance of $114,848.28 for the 2024-25 Annual Reconciliation Invoice. RELEVANT STANDARDS ·Comply with Resolution No. OC SAN 21-05 PROBLEM Color Fashion Dye &Finishing is delinquent and currently owes $114,848.28 for their 2024-25 Annual Reconciliation Invoice. PROPOSED SOLUTION Resolution No.OC SAN 21-05 allows for a payment agreement to allow a permittee to pay the amounts owed while continuing to conduct their business with a valid industrial wastewater discharge permit. Orange County Sanitation District Printed on 12/3/2025Page 1 of 2 powered by Legistar™ File #:2025-4636 Agenda Date:12/10/2025 Agenda Item No:9. TIMING CONCERNS N/A RAMIFICATIONS OF NOT TAKING ACTION If no action is taken,Color Fashion Dye &Finishing will begin accruing late penalties and finance charges, increasing the balance due on the account. PRIOR COMMITTEE/BOARD ACTIONS N/A ADDITIONAL INFORMATION Color Fashion Dye &Finishing is requesting a payment term of twelve months.Per Resolution No. OC SAN 21-05,the interest rate is calculated to be 10%.Staff are requiring a bond or other form of financial security as a part of any Payment Agreement. CEQA N/A FINANCIAL CONSIDERATIONS N/A ATTACHMENT The following attachment(s)may be viewed on-line at the OC San website (www.ocsan.gov)with the complete agenda package: ·Draft Payment Agreement, Color Fashion Dye & Finishing, LLC Orange County Sanitation District Printed on 12/3/2025Page 2 of 2 powered by Legistar™ 1 PAYMENT AGREEMENT THIS AGREEMENT is entered into, to be effective December 18, 2025, by and between Orange County Sanitation District ("OC San"), a county sanitation district duly organized and existing pursuant to Section 4700 et. seq. of the Health & Safety Code of the State of California and Color Fashion Dye & Finishing, LLC. (“Permittee”). RECITALS A. OC San is a wastewater treatment agency which owns and operates wastewater treatment facilities which receive, treat and discharge, through an ocean outfall, wastewater received from dischargers within its jurisdictional boundaries. In the course of its wastewater treatment operations, and pursuant to Ordinance No. OCSD- 53 Wastewater Discharge Regulations ("OC San's Ordinance"), OC San issues industrial wastewater discharge permits to certain persons/entities which discharge wastewater into the OC San's sewerage system. B. As part of the OC San's wastewater treatment operations, OC San imposes user fees on permittees, requiring such permittees to pay their share of the OC San's costs of conveying, treating and disposing of wastewater discharged by such permittees. C. Permittee is the holder of an industrial wastewater discharge permit issued by OC San and is responsible for paying user fees for the cost of conveying, treating and disposing of wastewater discharged from Permittee’s facility located at 1365 N. Knollwood Circle, Anaheim. D. OC San has issued to Permittee Invoice No. 913954 in the amount of $114,848.28 for user fees then due and owing to the OC San. E. Permittee has failed to pay the presently owing sum of $114,848.28 and has requested additional time to pay this outstanding obligation. 2 F. Pursuant to Resolution No. OC SAN 21-05, OC San is authorized to enter into deferred payment agreements for limited sums and of limited duration, pursuant to approval by the OC San’s Board of Directors. G. The OC San intends to provide additional time for Permittee to pay to OC San the amounts presently due on Invoice No. 913954. in accordance with the requirements of Resolution No. OC SAN 21-05. NOW, THEREFORE, in consideration of the facts recited above and the conditions, covenants and promises set forth below, OC San and Color Fashion Dye & Finishing, LLC agree as follows: AGREEMENT 1. Permittee shall make payments (including principal and interest) to the OC San, pursuant to the payment schedule in Appendix A. 2. Permittee shall pay to OC San all other invoices issued by the OC San during the term of this Agreement in accordance with the provisions of OC San's Ordinance. 3. If any payment described in Paragraph 1 herein is not received by the OC San on or before the due date specified, or if any payment described in Paragraph 2 herein is not received by OC San in accordance with the provisions of OC San's Ordinance, the entire balance then owing shall become immediately due and payable and interest at the rate of ten percent (10%) per annum shall accrue on any such unpaid balance from the date of acceleration until the date that the balance due is fully paid to the OC San. 4. Permittee acknowledges that the failure to pay current invoices, or failure to pay any installment in accordance with the schedule set forth in Paragraph 1 herein, may be grounds for suspension of any industrial wastewater discharge permit issued to Permittee by OC San, and shall additionally be deemed a breach of this Agreement, 3 thereby giving rise to all legal remedies available to OC San. Permittee agrees that by executing this Deferred Payment Agreement, Permittee waives the right to an administrative hearing for non-payment of invoices or any other means to challenge the amount owed, and further agrees that failure to pay OC San in accordance with the terms of this Agreement will result in immediate permit suspension until such time as the all outstanding amounts owed are current. 5. In consideration of the foregoing, OC San agrees to refrain from instituting collection or permit suspension or revocation proceedings, which remedies are presently available to the OC San as a result of Permittee’s current failure to pay Invoice No. 913954. This provision to refrain from instituting such proceedings shall be effective with regard only to Invoice No. 913954 for so long as Permittee remains in compliance with the terms of this Agreement. 6. Should any litigation be commenced between the OC San and Permittee regarding enforcement of this Agreement, or the rights and any duties of the parties in relation thereto, the prevailing party in such litigation shall be entitled, in addition to such other relief as may be granted, to a reasonable sum as and for its attorney fees and costs in the litigation which shall be determined by the court in such litigation or in a separate action brought for that purpose. 7. Nothing in this Agreement shall affect Permittee’s obligation to pay current and/or future charges for use of OC San's sewerage system or Permittee’s obligation to comply with all other conditions and requirements of its industrial wastewater discharge permit and the OC San's Ordinance. 8. Nothing herein shall affect OC San's right to enforce all requirements and conditions of the OC San's Ordinance. 9. This Agreement is made only for the benefit of the parties hereto. It is not intended that any right under this Agreement shall accrue to any third person. IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement 4 as of the day and year first written above. Orange County Sanitation District BY: ____________________________ Ryan P. Gallagher Chair, Board of Directors Attest: Color Fashion Dye & Finishing, LLC BY: ______________________ ____________________________ Kelly A. Lore <<Company Officer>> Clerk of the Board <<Officer Title>> ADMINISTRATION COMMITTEE Agenda Report Headquarters 18480 Bandilier Circle Fountain Valley, CA 92708 (714) 593-7433 File #:2025-4637 Agenda Date:12/10/2025 Agenda Item No:10. FROM:Robert Thompson, General Manager Originator: Wally Ritchie, Director of Finance SUBJECT: INVEST AND/OR REINVEST ORANGE COUNTY SANITATION DISTRICT’S FUNDS AND ADOPT INVESTMENT POLICY STATEMENT GENERAL MANAGER'S RECOMMENDATION RECOMMENDATION: Recommend to the Board of Directors to: Adopt Resolution No.OC SAN 25-XX entitled:“A Resolution of the Board of Directors of the Orange County Sanitation District,Authorizing the Orange County Sanitation District’s Treasurer to Invest and/or Reinvest the Orange County Sanitation District’s Funds,Adopting the Orange County Sanitation District’s Investment Policy Statement and Performance Benchmarks,and Repealing Resolution No. OC SAN 24-14”. BACKGROUND This agenda item presents updates to the Orange County Sanitation District (OC San)Investment Policy Statement for consideration by the Administration Committee as it is the oversight committee for the Investment Policy (Section 19.2). Proposed changes to the Investment Policy are as follows: -Revise the maximum maturity periods for investments in prime quality commercial paper from 270 days to 397 days in Section 8.4 (Commercial Paper) per California Senate Bill 858. -Add the Liquid Operating portfolio in Section 14.11 which states that no more than 20%of the portfolios may be invested in a combination of non-agency mortgage-backed securities,non- agency collateralized mortgage obligations and private label asset-backed securities. With adoption of the Resolution,the Board of Directors would readopt OC San’s Investment Policy Statement,portfolio performance benchmarks,and monitoring and reporting requirements for calendar year 2026. RELEVANT STANDARDS ·Comply with OC San Policy: OC San Investment Policy ·Comply with Government Code Sections 53607 & 53646 Orange County Sanitation District Printed on 12/2/2025Page 1 of 3 powered by Legistar™ File #:2025-4637 Agenda Date:12/10/2025 Agenda Item No:10. PROBLEM Government Code §53607 allows for the Board of Directors to delegate authority to invest and/or reinvest OC San’s funds to the Treasurer for a one-year period.Government Code §53646 requires OC San to review its Investment Policy annually and readopt its Policy at a public meeting,which will establish specific performance benchmarks and objectives and specific monitoring and reports. Pursuant to Government Code §53646,OC San’s Investment Policy must be reviewed and readopted prior to December 31, 2025. PROPOSED SOLUTION With adoption of the proposed Resolution,the Board of Directors would renew its delegation of investment authority to the Director of Finance/Treasurer for a one-year period,January 1,2026 to December 31,2026,in compliance with the requirements of Government Code §53607.Each year, the Board of Directors will consider similar actions,along with the annual reconsideration of OC San’s Investment Policy. TIMING CONCERNS The Board of Directors delegation of authority to the Director of Finance/Treasurer to invest and/or reinvest OC San’s funds will expire on December 31, 2025. RAMIFICATIONS OF NOT TAKING ACTION OC San’s Director of Finance/Treasurer will not have the authority to invest and/or reinvest OC San’s funds and OC San will not be in compliance with Government Code §53646. PRIOR COMMITTEE/BOARD ACTIONS December 2024 -Adopted Resolution No.OC SAN 24-14 entitled:“A Resolution of the Board of Directors of the Orange County Sanitation District Authorizing the Orange County Sanitation District’s Treasurer to Invest and/or Reinvest the Orange County Sanitation District’s Funds,Adopting the Orange County Sanitation District’s Investment Policy Statement and Performance Benchmarks,and Repealing Resolution No. OC SAN 23-23”. ADDITIONAL INFORMATION OC San’s Investment Policy Statement is a comprehensive document describing the policy, authorizations,benchmarks,delegations,and investment limitations.The Investment Policy will govern the investment activities of OC San's external investment manager on behalf of OC San. Annual Review of Investment Policy The Investment Policy includes the requirement that OC San shall review its Investment Policy annually (Sections 1.2 and 19.1).OC San’s investment manager reviewed the existing policy to ensure that the language remains current with the Government Code.The proposed Investment Policy is attached with redlined changes from the most recent approved policy in December 2024. Orange County Sanitation District Printed on 12/2/2025Page 2 of 3 powered by Legistar™ File #:2025-4637 Agenda Date:12/10/2025 Agenda Item No:10. Annual Delegation of Investment Authority Effective January 1,1997,Government Code §53607 states that governing boards of local agencies may only delegate authority to invest and/or reinvest agency funds to the agency's Treasurer for a one-year period. ATTACHMENT The following attachment(s)may be viewed on-line at the OC San website (www.ocsan.gov)with the complete agenda package: ·Orange County Sanitation District Calendar Year 2025 Investment Policy Statement (Redline) ·Orange County Sanitation District Calendar Year 2026 Investment Policy Statement (Clean) ·Proposed Resolution No. OC SAN 25-XX Orange County Sanitation District Printed on 12/2/2025Page 3 of 3 powered by Legistar™ ORANGE COUNTY SANITATION DISTRICT INVESTMENT POLICY STATEMENT 1.0 Policy: It is the policy of the Orange County Sanitation District (OC San) to invest public funds in a manner which ensures the safety and preservation of capital while meeting reasonably anticipated operating expenditure needs, achieving a reasonable rate of return and conforming to all state and local statutes governing the investment of public funds. 1.1. This Investment Policy is set forth by OC San for the following purposes: 1.1.1. To establish a clear understanding for the Board of Directors, OC San management, responsible employees and third parties of the objectives, policies and guidelines for the investment of OC San’s idle and surplus funds. 1.1.2. To offer guidance to investment staff and any external investment advisors on the investment of OC San funds. 1.1.3. To establish a basis for evaluating investment results. 1.2. OC San establishes investment policies which meet its current investment goals. OC San shall review this policy annually and may change its policies as its investment objectives change. 2.0 Scope: This Investment Policy applies to all financial assets of OC San; except for the proceeds of OC San’s capital projects financing program, which are invested in accordance with provisions of their specific bond indentures; and such other funds excluded by law or other Board-approved covenant or agreement. These funds are accounted for by OC San as Enterprise Funds as represented in OC San’s Annual Comprehensive Financial Report. 3.0 Standard of Prudence: The standard of prudence to be used by OC San internal staff, and any authorized investment advisor(s), shall be as described in Section 53600.3 of the California Government Code as follows: Except as provided in subdivision (a) of Section 27000.3, all governing bodies of local agencies or persons authorized to make investment decisions on behalf of those local agencies investing public funds pursuant to this chapter are trustees and therefore fiduciaries subject to the prudent investor standard. When investing, reinvesting, purchasing, acquiring, exchanging, selling, or managing public funds, a trustee shall act with care, skill, prudence, and diligence under the circumstances then prevailing, including, but not limited to, the general economic conditions and the Page 1 anticipated needs of the agency, that a prudent person acting in a like capacity and familiarity with those matters would use in the conduct of funds of a like character and with like aims, to safeguard the principal and maintain the liquidity needs of the agency. Within the limitations of this section and considering individual investments as part of an overall strategy, investments may be acquired as authorized by law. 4.0 Investment Objectives: The primary objectives of OC San’s investment activities, in priority order, and as described in Section 53600.5 of the California Government Code, shall be: 4.1 Safety: The safety and preservation of principal is the foremost objective of the investment program of OC San. Investments shall be selected in a manner that seeks to ensure the preservation of capital in OC San’s overall portfolio. This will be accomplished through a program of diversification, more fully described in Section 14.0, and maturity limitations, more fully described in Section 15.0, in order that potential losses on individual securities do not exceed the income generated from the remainder of the portfolio. 4.2 Liquidity: The investment program will be administered in a manner that will ensure that sufficient funds are available for OC San to meet its reasonably anticipated operating expenditure needs. 4.3 Return on Investments: The OC San investment portfolio will be structured and managed with the objective of achieving a market rate of return throughout budgetary and economic cycles, commensurate with legal, safety and liquidity considerations. 5.0 Delegation of Authority: 5.1 Authority to manage OC San’s investment program is derived from the California Government Code Sections 53600 et seq. and Sections 53635 et seq. The Board of Directors hereby delegates management responsibility for OC San’s investment program to its Director of Finance/Treasurer, who shall establish written procedures for the operation of the investment program, consistent with this policy. The Financial Management Manager/Assistant Treasurer shall be responsible for day-to-day administration, monitoring and the development of written administrative procedures for the operation of the investment program, consistent with this policy. No person may engage in an investment transaction except as provided under the terms of this policy and the procedures established by the Treasurer. The Treasurer shall be responsible for all transactions undertaken by OC San internal staff and shall establish a system of controls to regulate the activities of internal staff and external investment advisors engaged in accordance with Section 5.3. 5.2 The administrative procedures for the operation of OC San’s investment program will provide for, but not be limited to, the following: Page 2 5.2.1 Formats for monthly and quarterly reports to the Administration Committee and the Board of Directors. 5.2.2 Compliance with generally accepted accounting principles of the Government Accounting Standards Board. 5.2.3 Establishment of benchmarks for performance measurement. 5.2.4 Establishment of a system of written internal controls. 5.2.5 Establishment of written procedures for competitive bids and offerings of securities that may be purchased or sold by internal OC San staff. 5.2.6 Establishment of a Desk Procedures Manual for treasury operations and management. 5.3 The Board of Directors may, in its discretion, engage the services of one or more registered investment advisors to assist in the management of OC San’s investment portfolio in a manner consistent with OC San’s objectives. Such external investment advisors, which shall be selected through a competitive process, shall be granted discretion to purchase and sell investment securities in accordance with this Investment Policy. Such advisors must be registered under the Investment Advisers Act of 1940 or be exempt from such registration. 6.0 Ethics and Conflicts of Interest: Officers and employees of OC San involved in the investment process shall refrain from personal business activities that could conflict with proper execution of OC San’s investment program, or which could impair their ability to make impartial investment decisions. Employees and investment officials shall disclose to the General Manager any material financial interests in financial institutions that conduct business within OC San’s boundaries and they shall further disclose any large personal financial/investment positions, the performance of which could be related to the performance of positions in OC San’s portfolio. 7.0 Authorized Financial Dealers and Institutions: 7.1 For investment transactions conducted by OC San internal staff, the Treasurer will maintain a list of financial institutions authorized to provide investment services to OC San, including "primary" or regional dealers that qualify under Securities and Exchange Commission Rule 15C3-1 (Uniform Net Capital rule) and Federal or State of California chartered banks. No public deposit shall be made except in a qualified public depository as established by State law. Page 3 All financial institutions which desire to become qualified bidders for investment transactions with OC San must supply the following for evaluation by the Treasurer: 7.1.1. Audited financial statements for the institution’s three most recent fiscal years. 7.1.2. A statement, in the format prescribed by the Government Finance Officers Association (GFOA), certifying that the institution has reviewed OC San’s Investment Policy and that all securities offered to OC San shall comply fully and in every instance with all provisions of the California Government Code and with this Investment Policy. The current statement is presented in Appendix "A." 7.1.3. A statement describing the regulatory status of the dealer and the background and expertise of the dealer's representatives. Selection of financial institutions, broker/dealers and banks authorized to engage in transactions with OC San shall be made through a competitive process. An annual review of the financial condition of qualified institutions will be conducted by the Treasurer. 7.2 Selection of broker/dealers used by external investment advisors retained by OC San shall be in compliance with contract provisions between OC San and any external investment advisors and shall be in substantially the following form: Use of Securities Brokers: Neither the Investment Advisor nor any parent, subsidiary or related firm shall act as a securities broker with respect to any purchases or sales of securities which may be made on behalf of OC San, provided that this limitation shall not prevent the Investment Advisor from utilizing the services of a securities broker which is a parent, subsidiary or related firm, provided such broker effects transactions on a "cost only" or "nonprofit" basis to itself and provides competitive execution. The Investment Advisor shall provide OC San with a list of suitable independent brokerage firms meeting the requirements of Government Code Section 53601.5, and, unless otherwise directed by OC San, the Investment Advisor may utilize the service of any of such independent securities brokerage firms it deems appropriate to the extent that such firms are competitive with respect to price of services and execution. 8.0 Authorized and Suitable Investments: All investments shall be made in accordance with the California Government Code including Sections 16429.1 et seq., 53600 et seq. and 53684, and as described within this Investment Policy. Permitted investments under this policy shall include: Page 4 8.1 Securities, obligations, participations, or other instruments of, or issued by, or fully guaranteed as to principal and interest by the US Government, a federal agency, or a US Government-sponsored enterprise pursuant to Section 53601 (f) of the California Government Code. US Treasury securities must make up at least 10% of the portfolio. 8.2 Supranational Obligations issued or unconditionally guaranteed by the International Bank for Reconstruction and Development, International Finance Corporation, or Inter-American Development Bank. Securities must be eligible for purchase in the United States and be U.S. dollar denominated senior unsecured unsubordinated obligations, with a maximum maturity of five years. Securities eligible for purchase under this section must be rated “AA” or better by a Nationally Recognized Statistical Rating Organization (NRSRO) and shall not exceed 30% of the total portfolio. 8.3 Non-agency mortgage pass-through security, non-agency collateralized mortgage obligation, non-agency mortgage-backed or other pay-through bond, equipment lease-backed certificate, consumer receivable pass-through certificate, or consumer receivable-backed bond. Securities eligible for investment under this subdivision shall be rated in a rating category of “AA” or its equivalent or better by an NRSRO and have a maximum remaining maturity of five years or less. Purchase of securities authorized by this subdivision may not exceed 20% of the agency’s surplus moneys that may be invested pursuant to this section. Purchase of mortgage derivatives, which include interest- only payments (IOs) and principal-only payments (POs); inverse floaters, and RE-REMICs (Real Estate Mortgage Investment Conduits), is hereby prohibited. 8.4 Commercial paper of "prime" quality of the highest ranking or of the highest letter and number rating as provided by an NRSRO. Eligible commercial paper issuers may be organized and operating in the United States as a general corporation with total assets in excess of $500 million and if the issuer has long-term debt outstanding it has a rating of "A" or better as provided by an NRSRO; or eligible commercial paper issuers may be organized within the United States as a special purpose corporation, trust, or limited liability company, with program wide credit enhancements including, but not limited to, overcollateralization, letters of credit, or a surety bond, and commercial paper that is rated “A-1” or higher or the equivalent by an NRSRO. Purchases of eligible commercial paper may not exceed 270397 days to maturity from the date of purchase. Purchases of commercial paper shall not exceed 40% of the market value of the portfolio. No more than 5% of the market value of the portfolio, or 10% of the issuer's outstanding paper, may be invested in commercial paper issued by any one eligible corporation. 8.5 Banker’s acceptances issued by institutions, the short-term obligations of which are rated of the highest ranking or the highest letter and number rating as provided by an NRSRO provided that: (a) the acceptance is Page 5 eligible for purchase by the Federal Reserve System; (b) the maturity does not exceed 180 days; (c) no more than 40% of the total portfolio may be invested in banker’s acceptances; and (d) no more than 5% of the total portfolio may be invested in the banker's acceptances of any one commercial bank. 8.6 Medium term (or corporate) notes of a maximum of five years maturity issued by corporations organized and operating within the United States, or issued by depository institutions licensed by the United States, or any state, and operating within the United States with assets in excess of $500 million, and which is rated in a rating category of “A” or better on its long-term debt as provided by an NRSRO. If, after purchase, the rating of an eligible note falls below the minimum rating category stipulated above, the external investment advisor shall notify OC San of the downgrade and shall present an analysis and recommendations as to the disposition of the note consistent with the investment objectives of this Investment Policy. No more than 30% of the portfolio may be invested in medium term notes. 8.7 Notes, bonds, or other obligations that are at all times secured by a valid first priority security interest in securities of the types listed by California Government Code Section 53651 as eligible securities for the purpose of securing local agency deposits having a market value at least equal to that required by California Government Code Section 53652 for the purpose of securing local agency deposits. The securities serving as collateral shall be placed by delivery or book entry into the custody of a trust company or the trust department of a bank that is not affiliated with the issuer of the secured obligation, and the security interest shall be perfected in accordance with the requirements of the Uniform Commercial Code or federal regulations applicable to the types of securities in which the security interest is granted. 8.8 Shares of mutual funds investing in securities permitted under this policy and under Section 53601 (l) of the California Government Code. Such funds must either: (1) attain the highest ranking, or the highest letter and numerical rating, provided by not less than two of the three largest nationally recognized rating services; or (2) have an Investment Advisor registered with the Securities and Exchange Commission with not less than five years of experience investing in the securities and obligations authorized under this policy and under California Government Code Section 53601 and with assets under management in excess of $500 million. The purchase price of shares of beneficial interest purchased pursuant to this policy and the California Government Code may not include any commission that the companies may charge and shall not exceed 20% of OC San’s surplus money that may be invested pursuant to this section. No more than 10% of OC San’s surplus funds may be invested in shares of beneficial interest of any one mutual fund pursuant to this section. Money market mutual funds are limited to 20% per issuer and are not subject to the 10% stipulation. Page 6 8.9 Certificates of deposit: 8.9.1 Secured (collateralized) time deposits issued by a nationally or state-chartered bank or state or federal savings and loan association, as defined by Section 5102 of the California Financial Code, and having a net operating profit in the two most recently completed fiscal years. Collateral must comply with Chapter 4, Bank Deposit Law, Section 16500 et seq., and Chapter 4.5, Savings and Loan Association and Credit Union Deposit Law, Section 16600 et seq., of the California Government Code. 8.9.2 Negotiable certificates of deposit (NCDs) issued by a nationally or state-chartered bank or state of federal savings and loan association, as defined by Section 5102 of the California Financial Code; and which shall have a rating of "A" or better on its long-term debt as provided by a NRSRO; or which shall have the highest letter and number rating for deposits as provided by a NRSRO; or as otherwise approved by the Board of Directors. No more than 30% of the portfolio may be invested in securities pursuant to this section. 8.9.3 To be eligible to receive local agency money, a bank, savings association, federal association, or federally insured individual loan company shall have received an overall rating of not less than “satisfactory” in its most recent evaluation by the appropriate federal financial supervisorial agency of its record of meeting the credit needs of California’s communities, including low and moderate income neighborhoods, pursuant to Section 2906 of Title 12 of the United States Code. 8.10 Taxable or tax-exempt municipal bonds issued by any of the 50 United States. Such securities must be rated “A” or higher by a NRSRO; or as otherwise approved by the Board of Directors. 8.11 The State of California Local Agency Investment Fund (LAIF). LAIF is an investment alternative for California's local governments and special districts managed by the State Treasurer's Office. LAIF is more fully described in the Glossary (See Appendix "C"). OC San shall use LAIF as a short-term cash management facility. Investment of OC San funds in LAIF shall be subject to investigation and due diligence prior to investing, and on a continual basis to a level of review pursuant to Section 3.0, Standard of Prudence, of this policy. 8.12 The Orange County Treasurer's Money Market Commingled Investment Pool (OCCIP). The OCCIP is a money market investment pool managed by the Orange County Treasurer's Office. OCCIP is more fully described in the Glossary (See Appendix "C"). OC San has no funds invested in OCCIP at this time. Investment of OC San funds in OCCIP would be subject to investigation and due diligence prior to investing, and on a continual basis to a level of review pursuant to Section 3.0, Standard of Prudence, of this policy. Page 7 8.13 Repurchase agreements provided that: 8.13.1 All repurchase agreements shall be collateralized with securities eligible for purchase under this policy. In order to anticipate market changes and to provide a level of security for all repurchase agreement transactions, collateralization shall be maintained at a level of at least 102% of the market value of the repurchase agreements and shall be adjusted no less than weekly. 8.13.2 The maximum maturity of repurchase agreements shall be 1 year. 8.13.3 All repurchase agreements must be the subject of a Master Repurchase Agreement between OC San and the provider of the repurchase agreement. The Master Repurchase Agreement shall be substantially in the form developed by the Securities Industry and Financial Markets Association. 8.14 Reverse repurchase agreements provided that: 8.14.1 No more than 5% of OC San’s portfolio shall be invested in reverse repurchase agreements, and there shall be no long-term reverse repurchase agreements unless otherwise authorized by the Board of Directors. 8.14.2 The maximum maturity of reverse repurchase agreements shall be 90 days. 8.14.3 Reverse repurchase agreements shall mature on the exact date of a known cash flow which will be unconditionally available to repay the maturing reverse repurchase agreement. 8.14.4 Proceeds of reverse repurchase agreements shall be used solely to supplement portfolio income or to provide portfolio liquidity and shall not be used to speculate on market movements. 8.14.5 All reverse repurchase agreements must be the subject of a Master Repurchase Agreement between OC San and the provider of the reverse repurchase agreement. The Master Repurchase Agreement shall be substantially in the form developed by the Securities Industry and Financial Markets Association. 8.15 Public Bank Obligations of a maximum of five years maturity which includes commercial paper, debt securities, or other obligations of a public bank, a public bank as defined in California Government Code Section 57600-57607. 8.16 Sales of OC San-owned securities in the secondary market may incur losses in order to improve the risk or return characteristics of the portfolio, Page 8 to prevent anticipated further erosion of principal, or when trading for securities that result in an expected net economic gain to OC San. 8.17 If securities owned by OC San are downgraded below the quality required by this Investment Policy, it shall be OC San’s policy to review the credit situation and make a determination as to whether to sell or retain such securities in the portfolio. If a decision is made to retain the downgraded securities in the portfolio, their presence in the portfolio will be monitored and reported quarterly to the OC San General Manager, the Administration Committee and Board of Directors. 8.18 OC San is authorized to invest in securities issued by or backed by the United States Government that could result in zero or negative interest accrual if held to maturity. 9.0 Prohibited Investment Vehicles and Practices: 9.1 State law notwithstanding, any investments not specifically described herein are prohibited, including, but not limited to futures and options. 9.2 In accordance with Government Code, Section 53601.6, investment in inverse floaters, range notes, or mortgage derived interest-only strips is prohibited. 9.3 Trading securities for the sole purpose of speculating on the future direction of interest rates is prohibited. 9.4 Purchasing or selling securities on margin is prohibited. 9.5 The purchase of foreign currency denominated securities is prohibited. 9.6 Agencies that are not Qualified Institutional Buyers (QIB) as defined by the Securities and Exchange Commission are prohibited from purchasing Private Placement Securities. The SEC defines a QIB as having at least $100,000,000 in securities owned and invested. 9.7 The purchase of a security with a forward settlement date exceeding 45 days from the time of investment is prohibited. 10.0 Review of Investment Portfolio: The securities held by OC San must be in compliance with Section 8.0 “Authorized and Suitable Investments” at time of purchase. If at a later date, a security is no longer in compliance with Section 8.0, the Treasurer shall report the non-compliant security to the Administration Committee and the Board of Directors and shall include a disclosure in the quarterly Treasurer’s Report if the security is held at the date the report is prepared. Page 9 11.0 Investment Pools/Mutual Funds: A thorough investigation of the pool/fund is required prior to investing, and on a continual basis. A questionnaire shall be developed that will provide the following information: 11.1 A description of eligible investment securities, and a written statement of investment policy and objectives. 11.2 A description of interest calculations and how they are distributed, and how gains and losses are treated. 11.3 A description of how the securities are safeguarded (including the settlement processes) and how often the securities are priced and the program audited. 11.4 A description of who may invest in the program, how often and what size deposits and withdrawals are allowed. 11.5 A schedule for receiving statements and portfolio listings. 11.6 A description of the utilization and level of reserves, retained earnings or other collateral and how they are used by the fund. 11.7 A fee schedule, and when and how is it assessed. 11.8 Whether the pool/fund is eligible for bond proceeds and/or whether it will accept such proceeds. 12.0 Collateralization: Generally, the value to secure deposits under this policy shall comply with Section 53652 of the California Government Code. Collateralization will be required for secured time deposits, as more fully described in Section 8.9.1; and repurchase agreements, as more fully described in Section 8.13.1. Collateral will always be held by an independent third- party, as more fully described in Section 13.0. The right of collateral substitution is granted. Under provisions of the California Government Code, California banks and savings and loans associations are required to secure OC San’s deposits by pledging government securities with a value of 110% of principal and accrued interest. State law also allows financial institutions to secure OC San’s deposits by pledging first trust deed mortgage notes having a value of 150% of OC San’s total deposits. 13.0 Safekeeping and Custody: All securities transactions, including collateral for repurchase agreements, entered into by, or on behalf of OC San, shall be conducted on a delivery-versus-payment (DVP) basis. Securities will be held by OC San's third-party custodian bank, which shall be selected through a competitive process, or that agent's representative, or in the agent's account at the Federal Reserve Bank, or within clearing corporations in the U.S. and Page 10 evidenced by book entry statements. Third-party safekeeping arrangements will be approved by the Treasurer and will be corroborated by a written custodial agreement. 14.0 Diversification: OC San will diversify its investments by security type, issuer and financial institution in accordance with the following: 14.1 There is no limit on investment in securities issued by or guaranteed by the full faith and credit of the U.S. government. 14.2 No more than 20% of the portfolio may be invested in securities of a single agency of the U.S. government, which does not provide the full faith and credit of the U.S. government. No more than 20% of the portfolio may be invested in callable Agency securities. 14.3 No more than 5% of the portfolio may be invested in securities of any one issuer, other than Supranationals, the U.S. government or its agencies and Local Government Investment Pools (LGIPs). Investment in mutual funds is not governed by this Section 14.3. See Section 14.8 for conditions of purchase of mutual funds. 14.4 No individual holding shall constitute more than 5% of the total debt outstanding of any issuer. 14.5 No more than 40% of the portfolio may be invested in banker’s acceptances. 14.6 No more than 40% of the portfolio may be invested in commercial paper. 14.7 No more than 30% of the portfolio may be invested in medium-term (corporate) notes. 14.8 No more than 20% of the portfolio may be invested in mutual funds. No more than 10% of OC San’s portfolio may be invested in shares of beneficial interest of any one mutual fund. Money market mutual funds are limited to 20% per issuer and are not subject to the 10% stipulation. 14.9 No more than 30% of the portfolio may be invested in negotiable certificates of deposit. 14.10 No more than 10% of the portfolio may be invested in eligible municipal bonds. 14.11 No more than 20% of the Long Term Operating or Liquid Operating Monies portfolios may be invested in a combination of non-agency mortgage- backed securities, non-agency collateralized mortgage obligations and private label asset-backed securities. 14.12 No more than the statutory maximum may be invested in LAIF. Page 11 14.13 No more than 15% of the portfolio may be invested in the Orange County Investment Pool. 14.14 No more than 20% of the portfolio may be invested in repurchase agreements. 14.15 No more than 5% of the portfolio may be invested in reverse repurchase agreements. 15.0 Maximum Maturities: To the extent possible, OC San will attempt to match its investments with reasonably anticipated cash flow requirements. The Treasurer shall develop a five-year cash flow forecast, which shall be updated annually. Based on this forecast, the Treasurer shall designate, from time-to-time, the amounts to be allocated to the investment portfolio. OC San monies invested in accordance with this policy are divided into two categories: 15.1 Liquid Operating Monies. Funds needed for current operating and capital expenditures are known as Liquid Operating Monies. 15.1.1 The maximum final stated maturity of individual securities in the Liquid Operating Monies account portfolio shall be one year from the date of settlement. 15.1.2 The average duration of the Liquid Operating Monies account portfolio shall be recommended by the Treasurer based on OC San’s cash flow requirements but may never exceed 180 days. 15.2 Long Term Operating Monies. Funds needed for longer term purposes are known as the Long Term Operating Monies. 15.2.1 The maximum final stated maturity of individual securities in the Long Term Operating Monies account portfolio shall be five years from the date of settlement. 15.2.2 The duration of the Long Term Operating Monies account portfolio shall be recommended by the Treasurer based on OC San’s five- year cash flow forecast but may never exceed 60 months. 15.2.3 The duration of the Long Term Operating Monies account portfolio shall never exceed 120% of the duration as established in accordance with Section 15.2.2. 15.2.4 The duration of the Long Term Operating Monies account portfolio shall never be less than 80% of the duration as established in accordance with Section 15.2.2. Page 12 16.0 Internal Control: The Treasurer shall establish an annual process of independent review by an external auditor. This review will provide internal control by assuring compliance with policies and procedures. 17.0 Performance Objectives and Benchmarks: 17.1 Overall objective. The investment portfolio of OC San shall be designed with the overall objective of obtaining a rate of return throughout budgetary and economic cycles, commensurate with investment risk constraints and reasonably anticipated cash flow needs. 17.2 The Liquid Operating Monies. The investment performance objective for the Liquid Operating Monies shall be to earn a total rate of return over a market cycle which exceeds the return on a market index approved by the Administration Committee and by the Board of Directors, when the duration of the portfolio is established. This market index is more fully described in Board Resolution No. OC SAN 24-XX (see Appendix "B"). 17.3 The Long Term Operating Monies. The investment performance objective for the Long Term Operating Monies shall be to earn a total rate of return over a market cycle which exceeds the return on a market index selected by the Administration Committee and approved by the Board of Directors, when the duration of the portfolio is established. This market index is more fully described in Board Resolution No. OC SAN 24-XX (See Appendix "B"). 18.0 Reporting: 18.1 Monthly transaction reports in accordance with California Government Code Section 53607 shall be submitted by the Treasurer to the Board of Directors. 18.2 Quarterly investment reports will be submitted by the Treasurer to the Administration Committee which shall forward the reports to the Board of Directors within 45 days of the end of the reporting period. The quarterly reports shall provide clear and concise status information on OC San’s portfolios at the end of each reporting period, including performance measures using the benchmarks described in Section 17.0 of this Investment Policy. These reports shall include the following information: 18.2.1 A listing of individual securities held at the end of the reporting period by authorized investment category. 18.2.2 Average life and final maturity of all investments listed. 18.2.3 Coupon, discount or earnings rate. 18.2.4 Par value, amortized book value and market value. Page 13 18.2.5 Percentage of the portfolio represented by each investment category. 18.2.6 Duration of the portfolio. 18.2.7 For the Liquid Operating Monies account only, the percent of portfolio maturing within 90 days. 18.2.8 Average portfolio credit quality. 18.2.9 Percent of portfolio with credit ratings below "A" by any rating agency, and a description of such securities. 18.2.10 Percent of portfolio invested in reverse repurchase agreements, and a schedule which matches the maturity of such reverse repurchase agreements with the cash flows which are available to repay them at maturity. 18.2.11 A description of the funds, investments, and programs (including lending programs) managed by contracted parties (i.e. LAIF, investment pools, outside money managers, and securities lending agents). 18.2.12 OC San funds that have been placed in LAIF or in a county investment pool may substitute the most recent account statement received from those entities in lieu of the information recommended above. 18.2.13 Current market value as of the date of the report of all funds held by the local agency and under the management of any outside party that is not also a local agency or LAIF and the source of the valuation. 18.2.14 Monthly investment transactions for the Liquid Operating Monies and Long Term Operating Monies accounts. 18.2.15 A statement of compliance with this policy and the California Government Code or provide a listing of any transactions or holdings which do not comply with this policy or with the California Government Code. 18.2.16 A statement that sufficient funds are available for OC San to meet its operating expenditure requirements for the next six months, or if not, state the reasons for the shortfall. 18.3 OC San’s Treasurer shall meet quarterly with the Administration Committee to review investment performance, proposed strategies and compliance with this Investment Policy. External investment advisors may be required to attend said meetings at the discretion of the Administration Committee. Page 14 19.0 Investment Policy Adoption and Revision: 19.1 The Investment Policy of OC San shall be adopted by resolution of the Board of Directors. The Investment Policy shall be reviewed on an annual basis in accordance with California Government Code Section 53646, by the Administration Committee, which shall recommend revisions, as appropriate, to the Board of Directors. Any modifications made thereto shall be approved by the Board of Directors. 19.2 The Administration Committee shall serve as the oversight committee for OC San’s Investment program and shall adopt guidelines for the ongoing review of duration, quality and liquidity of OC San’s portfolio. ORANGE COUNTY SANITATION DISTRICT INVESTMENT POLICY STATEMENT 1.0 Policy: It is the policy of the Orange County Sanitation District (OC San) to invest public funds in a manner which ensures the safety and preservation of capital while meeting reasonably anticipated operating expenditure needs, achieving a reasonable rate of return and conforming to all state and local statutes governing the investment of public funds. 1.1. This Investment Policy is set forth by OC San for the following purposes: 1.1.1. To establish a clear understanding for the Board of Directors, OC San management, responsible employees and third parties of the objectives, policies and guidelines for the investment of OC San’s idle and surplus funds. 1.1.2. To offer guidance to investment staff and any external investment advisors on the investment of OC San funds. 1.1.3. To establish a basis for evaluating investment results. 1.2. OC San establishes investment policies which meet its current investment goals. OC San shall review this policy annually and may change its policies as its investment objectives change. 2.0 Scope: This Investment Policy applies to all financial assets of OC San; except for the proceeds of OC San’s capital projects financing program, which are invested in accordance with provisions of their specific bond indentures; and such other funds excluded by law or other Board-approved covenant or agreement. These funds are accounted for by OC San as Enterprise Funds as represented in OC San’s Annual Comprehensive Financial Report. 3.0 Standard of Prudence: The standard of prudence to be used by OC San internal staff, and any authorized investment advisor(s), shall be as described in Section 53600.3 of the California Government Code as follows: Except as provided in subdivision (a) of Section 27000.3, all governing bodies of local agencies or persons authorized to make investment decisions on behalf of those local agencies investing public funds pursuant to this chapter are trustees and therefore fiduciaries subject to the prudent investor standard. When investing, reinvesting, purchasing, acquiring, exchanging, selling, or managing public funds, a trustee shall act with care, skill, prudence, and diligence under the circumstances then prevailing, including, but not limited to, the general economic conditions and the Page 1 anticipated needs of the agency, that a prudent person acting in a like capacity and familiarity with those matters would use in the conduct of funds of a like character and with like aims, to safeguard the principal and maintain the liquidity needs of the agency. Within the limitations of this section and considering individual investments as part of an overall strategy, investments may be acquired as authorized by law. 4.0 Investment Objectives: The primary objectives of OC San’s investment activities, in priority order, and as described in Section 53600.5 of the California Government Code, shall be: 4.1 Safety: The safety and preservation of principal is the foremost objective of the investment program of OC San. Investments shall be selected in a manner that seeks to ensure the preservation of capital in OC San’s overall portfolio. This will be accomplished through a program of diversification, more fully described in Section 14.0, and maturity limitations, more fully described in Section 15.0, in order that potential losses on individual securities do not exceed the income generated from the remainder of the portfolio. 4.2 Liquidity: The investment program will be administered in a manner that will ensure that sufficient funds are available for OC San to meet its reasonably anticipated operating expenditure needs. 4.3 Return on Investments: The OC San investment portfolio will be structured and managed with the objective of achieving a market rate of return throughout budgetary and economic cycles, commensurate with legal, safety and liquidity considerations. 5.0 Delegation of Authority: 5.1 Authority to manage OC San’s investment program is derived from the California Government Code Sections 53600 et seq. and Sections 53635 et seq. The Board of Directors hereby delegates management responsibility for OC San’s investment program to its Director of Finance/Treasurer, who shall establish written procedures for the operation of the investment program, consistent with this policy. The Financial Management Manager/Assistant Treasurer shall be responsible for day-to-day administration, monitoring and the development of written administrative procedures for the operation of the investment program, consistent with this policy. No person may engage in an investment transaction except as provided under the terms of this policy and the procedures established by the Treasurer. The Treasurer shall be responsible for all transactions undertaken by OC San internal staff and shall establish a system of controls to regulate the activities of internal staff and external investment advisors engaged in accordance with Section 5.3. 5.2 The administrative procedures for the operation of OC San’s investment program will provide for, but not be limited to, the following: Page 2 5.2.1 Formats for monthly and quarterly reports to the Administration Committee and the Board of Directors. 5.2.2 Compliance with generally accepted accounting principles of the Government Accounting Standards Board. 5.2.3 Establishment of benchmarks for performance measurement. 5.2.4 Establishment of a system of written internal controls. 5.2.5 Establishment of written procedures for competitive bids and offerings of securities that may be purchased or sold by internal OC San staff. 5.2.6 Establishment of a Desk Procedures Manual for treasury operations and management. 5.3 The Board of Directors may, in its discretion, engage the services of one or more registered investment advisors to assist in the management of OC San’s investment portfolio in a manner consistent with OC San’s objectives. Such external investment advisors, which shall be selected through a competitive process, shall be granted discretion to purchase and sell investment securities in accordance with this Investment Policy. Such advisors must be registered under the Investment Advisers Act of 1940 or be exempt from such registration. 6.0 Ethics and Conflicts of Interest: Officers and employees of OC San involved in the investment process shall refrain from personal business activities that could conflict with proper execution of OC San’s investment program, or which could impair their ability to make impartial investment decisions. Employees and investment officials shall disclose to the General Manager any material financial interests in financial institutions that conduct business within OC San’s boundaries and they shall further disclose any large personal financial/investment positions, the performance of which could be related to the performance of positions in OC San’s portfolio. 7.0 Authorized Financial Dealers and Institutions: 7.1 For investment transactions conducted by OC San internal staff, the Treasurer will maintain a list of financial institutions authorized to provide investment services to OC San, including "primary" or regional dealers that qualify under Securities and Exchange Commission Rule 15C3-1 (Uniform Net Capital rule) and Federal or State of California chartered banks. No public deposit shall be made except in a qualified public depository as established by State law. Page 3 All financial institutions which desire to become qualified bidders for investment transactions with OC San must supply the following for evaluation by the Treasurer: 7.1.1. Audited financial statements for the institution’s three most recent fiscal years. 7.1.2. A statement, in the format prescribed by the Government Finance Officers Association (GFOA), certifying that the institution has reviewed OC San’s Investment Policy and that all securities offered to OC San shall comply fully and in every instance with all provisions of the California Government Code and with this Investment Policy. The current statement is presented in Appendix "A." 7.1.3. A statement describing the regulatory status of the dealer and the background and expertise of the dealer's representatives. Selection of financial institutions, broker/dealers and banks authorized to engage in transactions with OC San shall be made through a competitive process. An annual review of the financial condition of qualified institutions will be conducted by the Treasurer. 7.2 Selection of broker/dealers used by external investment advisors retained by OC San shall be in compliance with contract provisions between OC San and any external investment advisors and shall be in substantially the following form: Use of Securities Brokers: Neither the Investment Advisor nor any parent, subsidiary or related firm shall act as a securities broker with respect to any purchases or sales of securities which may be made on behalf of OC San, provided that this limitation shall not prevent the Investment Advisor from utilizing the services of a securities broker which is a parent, subsidiary or related firm, provided such broker effects transactions on a "cost only" or "nonprofit" basis to itself and provides competitive execution. The Investment Advisor shall provide OC San with a list of suitable independent brokerage firms meeting the requirements of Government Code Section 53601.5, and, unless otherwise directed by OC San, the Investment Advisor may utilize the service of any of such independent securities brokerage firms it deems appropriate to the extent that such firms are competitive with respect to price of services and execution. 8.0 Authorized and Suitable Investments: All investments shall be made in accordance with the California Government Code including Sections 16429.1 et seq., 53600 et seq. and 53684, and as described within this Investment Policy. Permitted investments under this policy shall include: Page 4 8.1 Securities, obligations, participations, or other instruments of, or issued by, or fully guaranteed as to principal and interest by the US Government, a federal agency, or a US Government-sponsored enterprise pursuant to Section 53601 (f) of the California Government Code. US Treasury securities must make up at least 10% of the portfolio. 8.2 Supranational Obligations issued or unconditionally guaranteed by the International Bank for Reconstruction and Development, International Finance Corporation, or Inter-American Development Bank. Securities must be eligible for purchase in the United States and be U.S. dollar denominated senior unsecured unsubordinated obligations, with a maximum maturity of five years. Securities eligible for purchase under this section must be rated “AA” or better by a Nationally Recognized Statistical Rating Organization (NRSRO) and shall not exceed 30% of the total portfolio. 8.3 Non-agency mortgage pass-through security, non-agency collateralized mortgage obligation, non-agency mortgage-backed or other pay-through bond, equipment lease-backed certificate, consumer receivable pass-through certificate, or consumer receivable-backed bond. Securities eligible for investment under this subdivision shall be rated in a rating category of “AA” or its equivalent or better by an NRSRO and have a maximum remaining maturity of five years or less. Purchase of securities authorized by this subdivision may not exceed 20% of the agency’s surplus moneys that may be invested pursuant to this section. Purchase of mortgage derivatives, which include interest- only payments (IOs) and principal-only payments (POs); inverse floaters, and RE-REMICs (Real Estate Mortgage Investment Conduits), is hereby prohibited. 8.4 Commercial paper of "prime" quality of the highest ranking or of the highest letter and number rating as provided by an NRSRO. Eligible commercial paper issuers may be organized and operating in the United States as a general corporation with total assets in excess of $500 million and if the issuer has long-term debt outstanding it has a rating of "A" or better as provided by an NRSRO; or eligible commercial paper issuers may be organized within the United States as a special purpose corporation, trust, or limited liability company, with program wide credit enhancements including, but not limited to, overcollateralization, letters of credit, or a surety bond, and commercial paper that is rated “A-1” or higher or the equivalent by an NRSRO. Purchases of eligible commercial paper may not exceed 397 days to maturity from the date of purchase. Purchases of commercial paper shall not exceed 40% of the market value of the portfolio. No more than 5% of the market value of the portfolio, or 10% of the issuer's outstanding paper, may be invested in commercial paper issued by any one eligible corporation. 8.5 Banker’s acceptances issued by institutions, the short-term obligations of which are rated of the highest ranking or the highest letter and number rating as provided by an NRSRO provided that: (a) the acceptance is Page 5 eligible for purchase by the Federal Reserve System; (b) the maturity does not exceed 180 days; (c) no more than 40% of the total portfolio may be invested in banker’s acceptances; and (d) no more than 5% of the total portfolio may be invested in the banker's acceptances of any one commercial bank. 8.6 Medium term (or corporate) notes of a maximum of five years maturity issued by corporations organized and operating within the United States, or issued by depository institutions licensed by the United States, or any state, and operating within the United States with assets in excess of $500 million, and which is rated in a rating category of “A” or better on its long-term debt as provided by an NRSRO. If, after purchase, the rating of an eligible note falls below the minimum rating category stipulated above, the external investment advisor shall notify OC San of the downgrade and shall present an analysis and recommendations as to the disposition of the note consistent with the investment objectives of this Investment Policy. No more than 30% of the portfolio may be invested in medium term notes. 8.7 Notes, bonds, or other obligations that are at all times secured by a valid first priority security interest in securities of the types listed by California Government Code Section 53651 as eligible securities for the purpose of securing local agency deposits having a market value at least equal to that required by California Government Code Section 53652 for the purpose of securing local agency deposits. The securities serving as collateral shall be placed by delivery or book entry into the custody of a trust company or the trust department of a bank that is not affiliated with the issuer of the secured obligation, and the security interest shall be perfected in accordance with the requirements of the Uniform Commercial Code or federal regulations applicable to the types of securities in which the security interest is granted. 8.8 Shares of mutual funds investing in securities permitted under this policy and under Section 53601 (l) of the California Government Code. Such funds must either: (1) attain the highest ranking, or the highest letter and numerical rating, provided by not less than two of the three largest nationally recognized rating services; or (2) have an Investment Advisor registered with the Securities and Exchange Commission with not less than five years of experience investing in the securities and obligations authorized under this policy and under California Government Code Section 53601 and with assets under management in excess of $500 million. The purchase price of shares of beneficial interest purchased pursuant to this policy and the California Government Code may not include any commission that the companies may charge and shall not exceed 20% of OC San’s surplus money that may be invested pursuant to this section. No more than 10% of OC San’s surplus funds may be invested in shares of beneficial interest of any one mutual fund pursuant to this section. Money market mutual funds are limited to 20% per issuer and are not subject to the 10% stipulation. Page 6 8.9 Certificates of deposit: 8.9.1 Secured (collateralized) time deposits issued by a nationally or state-chartered bank or state or federal savings and loan association, as defined by Section 5102 of the California Financial Code, and having a net operating profit in the two most recently completed fiscal years. Collateral must comply with Chapter 4, Bank Deposit Law, Section 16500 et seq., and Chapter 4.5, Savings and Loan Association and Credit Union Deposit Law, Section 16600 et seq., of the California Government Code. 8.9.2 Negotiable certificates of deposit (NCDs) issued by a nationally or state-chartered bank or state of federal savings and loan association, as defined by Section 5102 of the California Financial Code; and which shall have a rating of "A" or better on its long-term debt as provided by a NRSRO; or which shall have the highest letter and number rating for deposits as provided by a NRSRO; or as otherwise approved by the Board of Directors. No more than 30% of the portfolio may be invested in securities pursuant to this section. 8.9.3 To be eligible to receive local agency money, a bank, savings association, federal association, or federally insured individual loan company shall have received an overall rating of not less than “satisfactory” in its most recent evaluation by the appropriate federal financial supervisorial agency of its record of meeting the credit needs of California’s communities, including low and moderate income neighborhoods, pursuant to Section 2906 of Title 12 of the United States Code. 8.10 Taxable or tax-exempt municipal bonds issued by any of the 50 United States. Such securities must be rated “A” or higher by a NRSRO; or as otherwise approved by the Board of Directors. 8.11 The State of California Local Agency Investment Fund (LAIF). LAIF is an investment alternative for California's local governments and special districts managed by the State Treasurer's Office. LAIF is more fully described in the Glossary (See Appendix "C"). OC San shall use LAIF as a short-term cash management facility. Investment of OC San funds in LAIF shall be subject to investigation and due diligence prior to investing, and on a continual basis to a level of review pursuant to Section 3.0, Standard of Prudence, of this policy. 8.12 The Orange County Treasurer's Money Market Commingled Investment Pool (OCCIP). The OCCIP is a money market investment pool managed by the Orange County Treasurer's Office. OCCIP is more fully described in the Glossary (See Appendix "C"). OC San has no funds invested in OCCIP at this time. Investment of OC San funds in OCCIP would be subject to investigation and due diligence prior to investing, and on a continual basis to a level of review pursuant to Section 3.0, Standard of Prudence, of this policy. Page 7 8.13 Repurchase agreements provided that: 8.13.1 All repurchase agreements shall be collateralized with securities eligible for purchase under this policy. In order to anticipate market changes and to provide a level of security for all repurchase agreement transactions, collateralization shall be maintained at a level of at least 102% of the market value of the repurchase agreements and shall be adjusted no less than weekly. 8.13.2 The maximum maturity of repurchase agreements shall be 1 year. 8.13.3 All repurchase agreements must be the subject of a Master Repurchase Agreement between OC San and the provider of the repurchase agreement. The Master Repurchase Agreement shall be substantially in the form developed by the Securities Industry and Financial Markets Association. 8.14 Reverse repurchase agreements provided that: 8.14.1 No more than 5% of OC San’s portfolio shall be invested in reverse repurchase agreements, and there shall be no long-term reverse repurchase agreements unless otherwise authorized by the Board of Directors. 8.14.2 The maximum maturity of reverse repurchase agreements shall be 90 days. 8.14.3 Reverse repurchase agreements shall mature on the exact date of a known cash flow which will be unconditionally available to repay the maturing reverse repurchase agreement. 8.14.4 Proceeds of reverse repurchase agreements shall be used solely to supplement portfolio income or to provide portfolio liquidity and shall not be used to speculate on market movements. 8.14.5 All reverse repurchase agreements must be the subject of a Master Repurchase Agreement between OC San and the provider of the reverse repurchase agreement. The Master Repurchase Agreement shall be substantially in the form developed by the Securities Industry and Financial Markets Association. 8.15 Public Bank Obligations of a maximum of five years maturity which includes commercial paper, debt securities, or other obligations of a public bank, a public bank as defined in California Government Code Section 57600-57607. 8.16 Sales of OC San-owned securities in the secondary market may incur losses in order to improve the risk or return characteristics of the portfolio, Page 8 to prevent anticipated further erosion of principal, or when trading for securities that result in an expected net economic gain to OC San. 8.17 If securities owned by OC San are downgraded below the quality required by this Investment Policy, it shall be OC San’s policy to review the credit situation and make a determination as to whether to sell or retain such securities in the portfolio. If a decision is made to retain the downgraded securities in the portfolio, their presence in the portfolio will be monitored and reported quarterly to the OC San General Manager, the Administration Committee and Board of Directors. 8.18 OC San is authorized to invest in securities issued by or backed by the United States Government that could result in zero or negative interest accrual if held to maturity. 9.0 Prohibited Investment Vehicles and Practices: 9.1 State law notwithstanding, any investments not specifically described herein are prohibited, including, but not limited to futures and options. 9.2 In accordance with Government Code, Section 53601.6, investment in inverse floaters, range notes, or mortgage derived interest-only strips is prohibited. 9.3 Trading securities for the sole purpose of speculating on the future direction of interest rates is prohibited. 9.4 Purchasing or selling securities on margin is prohibited. 9.5 The purchase of foreign currency denominated securities is prohibited. 9.6 Agencies that are not Qualified Institutional Buyers (QIB) as defined by the Securities and Exchange Commission are prohibited from purchasing Private Placement Securities. The SEC defines a QIB as having at least $100,000,000 in securities owned and invested. 9.7 The purchase of a security with a forward settlement date exceeding 45 days from the time of investment is prohibited. 10.0 Review of Investment Portfolio: The securities held by OC San must be in compliance with Section 8.0 “Authorized and Suitable Investments” at time of purchase. If at a later date, a security is no longer in compliance with Section 8.0, the Treasurer shall report the non-compliant security to the Administration Committee and the Board of Directors and shall include a disclosure in the quarterly Treasurer’s Report if the security is held at the date the report is prepared. Page 9 11.0 Investment Pools/Mutual Funds: A thorough investigation of the pool/fund is required prior to investing, and on a continual basis. A questionnaire shall be developed that will provide the following information: 11.1 A description of eligible investment securities, and a written statement of investment policy and objectives. 11.2 A description of interest calculations and how they are distributed, and how gains and losses are treated. 11.3 A description of how the securities are safeguarded (including the settlement processes) and how often the securities are priced and the program audited. 11.4 A description of who may invest in the program, how often and what size deposits and withdrawals are allowed. 11.5 A schedule for receiving statements and portfolio listings. 11.6 A description of the utilization and level of reserves, retained earnings or other collateral and how they are used by the fund. 11.7 A fee schedule, and when and how is it assessed. 11.8 Whether the pool/fund is eligible for bond proceeds and/or whether it will accept such proceeds. 12.0 Collateralization: Generally, the value to secure deposits under this policy shall comply with Section 53652 of the California Government Code. Collateralization will be required for secured time deposits, as more fully described in Section 8.9.1; and repurchase agreements, as more fully described in Section 8.13.1. Collateral will always be held by an independent third- party, as more fully described in Section 13.0. The right of collateral substitution is granted. Under provisions of the California Government Code, California banks and savings and loans associations are required to secure OC San’s deposits by pledging government securities with a value of 110% of principal and accrued interest. State law also allows financial institutions to secure OC San’s deposits by pledging first trust deed mortgage notes having a value of 150% of OC San’s total deposits. 13.0 Safekeeping and Custody: All securities transactions, including collateral for repurchase agreements, entered into by, or on behalf of OC San, shall be conducted on a delivery-versus-payment (DVP) basis. Securities will be held by OC San's third-party custodian bank, which shall be selected through a competitive process, or that agent's representative, or in the agent's account at the Federal Reserve Bank, or within clearing corporations in the U.S. and Page 10 evidenced by book entry statements. Third-party safekeeping arrangements will be approved by the Treasurer and will be corroborated by a written custodial agreement. 14.0 Diversification: OC San will diversify its investments by security type, issuer and financial institution in accordance with the following: 14.1 There is no limit on investment in securities issued by or guaranteed by the full faith and credit of the U.S. government. 14.2 No more than 20% of the portfolio may be invested in securities of a single agency of the U.S. government, which does not provide the full faith and credit of the U.S. government. No more than 20% of the portfolio may be invested in callable Agency securities. 14.3 No more than 5% of the portfolio may be invested in securities of any one issuer, other than Supranationals, the U.S. government or its agencies and Local Government Investment Pools (LGIPs). Investment in mutual funds is not governed by this Section 14.3. See Section 14.8 for conditions of purchase of mutual funds. 14.4 No individual holding shall constitute more than 5% of the total debt outstanding of any issuer. 14.5 No more than 40% of the portfolio may be invested in banker’s acceptances. 14.6 No more than 40% of the portfolio may be invested in commercial paper. 14.7 No more than 30% of the portfolio may be invested in medium-term (corporate) notes. 14.8 No more than 20% of the portfolio may be invested in mutual funds. No more than 10% of OC San’s portfolio may be invested in shares of beneficial interest of any one mutual fund. Money market mutual funds are limited to 20% per issuer and are not subject to the 10% stipulation. 14.9 No more than 30% of the portfolio may be invested in negotiable certificates of deposit. 14.10 No more than 10% of the portfolio may be invested in eligible municipal bonds. 14.11 No more than 20% of the Long Term Operating or Liquid Operating Monies portfolios may be invested in a combination of non-agency mortgage- backed securities, non-agency collateralized mortgage obligations and private label asset-backed securities. 14.12 No more than the statutory maximum may be invested in LAIF. Page 11 14.13 No more than 15% of the portfolio may be invested in the Orange County Investment Pool. 14.14 No more than 20% of the portfolio may be invested in repurchase agreements. 14.15 No more than 5% of the portfolio may be invested in reverse repurchase agreements. 15.0 Maximum Maturities: To the extent possible, OC San will attempt to match its investments with reasonably anticipated cash flow requirements. The Treasurer shall develop a five-year cash flow forecast, which shall be updated annually. Based on this forecast, the Treasurer shall designate, from time-to-time, the amounts to be allocated to the investment portfolio. OC San monies invested in accordance with this policy are divided into two categories: 15.1 Liquid Operating Monies. Funds needed for current operating and capital expenditures are known as Liquid Operating Monies. 15.1.1 The maximum final stated maturity of individual securities in the Liquid Operating Monies account portfolio shall be one year from the date of settlement. 15.1.2 The average duration of the Liquid Operating Monies account portfolio shall be recommended by the Treasurer based on OC San’s cash flow requirements but may never exceed 180 days. 15.2 Long Term Operating Monies. Funds needed for longer term purposes are known as the Long Term Operating Monies. 15.2.1 The maximum final stated maturity of individual securities in the Long Term Operating Monies account portfolio shall be five years from the date of settlement. 15.2.2 The duration of the Long Term Operating Monies account portfolio shall be recommended by the Treasurer based on OC San’s five- year cash flow forecast but may never exceed 60 months. 15.2.3 The duration of the Long Term Operating Monies account portfolio shall never exceed 120% of the duration as established in accordance with Section 15.2.2. 15.2.4 The duration of the Long Term Operating Monies account portfolio shall never be less than 80% of the duration as established in accordance with Section 15.2.2. Page 12 16.0 Internal Control: The Treasurer shall establish an annual process of independent review by an external auditor. This review will provide internal control by assuring compliance with policies and procedures. 17.0 Performance Objectives and Benchmarks: 17.1 Overall objective. The investment portfolio of OC San shall be designed with the overall objective of obtaining a rate of return throughout budgetary and economic cycles, commensurate with investment risk constraints and reasonably anticipated cash flow needs. 17.2 The Liquid Operating Monies. The investment performance objective for the Liquid Operating Monies shall be to earn a total rate of return over a market cycle which exceeds the return on a market index approved by the Administration Committee and by the Board of Directors, when the duration of the portfolio is established. This market index is more fully described in Board Resolution No. OC SAN 24-XX (see Appendix "B"). 17.3 The Long Term Operating Monies. The investment performance objective for the Long Term Operating Monies shall be to earn a total rate of return over a market cycle which exceeds the return on a market index selected by the Administration Committee and approved by the Board of Directors, when the duration of the portfolio is established. This market index is more fully described in Board Resolution No. OC SAN 24-XX (See Appendix "B"). 18.0 Reporting: 18.1 Monthly transaction reports in accordance with California Government Code Section 53607 shall be submitted by the Treasurer to the Board of Directors. 18.2 Quarterly investment reports will be submitted by the Treasurer to the Administration Committee which shall forward the reports to the Board of Directors within 45 days of the end of the reporting period. The quarterly reports shall provide clear and concise status information on OC San’s portfolios at the end of each reporting period, including performance measures using the benchmarks described in Section 17.0 of this Investment Policy. These reports shall include the following information: 18.2.1 A listing of individual securities held at the end of the reporting period by authorized investment category. 18.2.2 Average life and final maturity of all investments listed. 18.2.3 Coupon, discount or earnings rate. 18.2.4 Par value, amortized book value and market value. Page 13 18.2.5 Percentage of the portfolio represented by each investment category. 18.2.6 Duration of the portfolio. 18.2.7 For the Liquid Operating Monies account only, the percent of portfolio maturing within 90 days. 18.2.8 Average portfolio credit quality. 18.2.9 Percent of portfolio with credit ratings below "A" by any rating agency, and a description of such securities. 18.2.10 Percent of portfolio invested in reverse repurchase agreements, and a schedule which matches the maturity of such reverse repurchase agreements with the cash flows which are available to repay them at maturity. 18.2.11 A description of the funds, investments, and programs (including lending programs) managed by contracted parties (i.e. LAIF, investment pools, outside money managers, and securities lending agents). 18.2.12 OC San funds that have been placed in LAIF or in a county investment pool may substitute the most recent account statement received from those entities in lieu of the information recommended above. 18.2.13 Current market value as of the date of the report of all funds held by the local agency and under the management of any outside party that is not also a local agency or LAIF and the source of the valuation. 18.2.14 Monthly investment transactions for the Liquid Operating Monies and Long Term Operating Monies accounts. 18.2.15 A statement of compliance with this policy and the California Government Code or provide a listing of any transactions or holdings which do not comply with this policy or with the California Government Code. 18.2.16 A statement that sufficient funds are available for OC San to meet its operating expenditure requirements for the next six months, or if not, state the reasons for the shortfall. 18.3 OC San’s Treasurer shall meet quarterly with the Administration Committee to review investment performance, proposed strategies and compliance with this Investment Policy. External investment advisors may be required to attend said meetings at the discretion of the Administration Committee. Page 14 19.0 Investment Policy Adoption and Revision: 19.1 The Investment Policy of OC San shall be adopted by resolution of the Board of Directors. The Investment Policy shall be reviewed on an annual basis in accordance with California Government Code Section 53646, by the Administration Committee, which shall recommend revisions, as appropriate, to the Board of Directors. Any modifications made thereto shall be approved by the Board of Directors. 19.2 The Administration Committee shall serve as the oversight committee for OC San’s Investment program and shall adopt guidelines for the ongoing review of duration, quality and liquidity of OC San’s portfolio. OC SAN 25-XX-1 RESOLUTION NO. OC SAN 25-XX A RESOLUTION OF THE BOARD OF DIRECTORS OF THE ORANGE COUNTY SANITATION DISTRICT, AUTHORIZING THE ORANGE COUNTY SANITATION DISTRICT'S TREASURER TO INVEST AND/OR REINVEST THE ORANGE COUNTY SANITATION DISTRICT'S FUNDS, ADOPTING THE ORANGE COUNTY SANITATION DISTRICT'S INVESTMENT POLICY STATEMENT AND PERFORMANCE BENCHMARKS, AND REPEALING RESOLUTION NO. OC SAN 24-14 WHEREAS, on December 18, 2024, the Board of Directors adopted Resolution No. OC SAN 24-14, readopting the Orange County Sanitation District's Investment Policy Statement, and establishing specific performance benchmarks and objectives, together with a schedule of frequency of investment performance reports; and WHEREAS, pursuant to California Government Code Section 53607, the Board of Directors may delegate authority to invest and/or reinvest the Orange County Sanitation District’s funds to the Treasurer for a one-year period; and WHEREAS, pursuant to California Government Code Section 53646, the Orange County Sanitation District is required to review its Investment Policy annually and readopt its Policy at a public meeting, which Policy will establish specific performance benchmarks and objectives, and specific monitoring and reports. NOW, THEREFORE, the Board of Directors of the Orange County Sanitation District, DOES HEREBY RESOLVE, DETERMINE AND ORDER: Section 1: That the authority of the Board of Directors to invest or reinvest surplus funds, or to sell or exchange securities so purchased, or to deposit for safekeeping the funds and investments of the Orange County Sanitation District with depositories, as provided for in California Government Code Sections 53608 and 53630, is hereby delegated to the Orange County Sanitation District’s Treasurer for a one-year period, January 1, 2026 through December 31, 2026, as authorized by California Government Code Section 53607. OC SAN 25-XX-2 Section 2: That the Board of Directors hereby adopts the Investment Policy Statement of the Orange County Sanitation District. Section 3: That the Board of Directors hereby adopts the following specific performance benchmarks for their two investment funds in accordance with Section 17.0 of the Orange County Sanitation District’s Investment Policy: LIQUID OPERATING MONIES: The Short-Term Operating Fund will be compared to the three-month Bank of America Merrill Lynch T-Bill Index and the Callan Money Market Funds. LONG-TERM OPERATING MONIES: The Long-Term Operating Fund will be compared to the Bank of America Merrill Lynch Corporate and Government One- to-Five Year Maturity Index and to the Callan Short Term Fixed Income Group. Section 4: That the Board of Directors hereby adopts a performance monitoring and reporting schedule, as required by Section 18.0 of the Orange County Sanitation District’s Investment Policy. Section 5: That Resolution No. OC SAN 24-14 is hereby repealed. OC SAN 25-XX-3 PASSED AND ADOPTED at regular meeting of the Board of Directors, Orange County Sanitation District held December 17, 2025. Ryan P. Gallagher Board Chairman ATTEST: Kelly A. Lore, MMC Clerk of the Board OC SAN 25-XX-4 STATE OF CALIFORNIA ) ) ss COUNTY OF ORANGE ) I, Kelly A. Lore, Clerk of the Board of Directors of the Orange County Sanitation District, do hereby certify that the foregoing Resolution No. OC SAN 25-XX was passed and adopted at a regular meeting of said Board on the 17th day of December 2025, by the following vote, to wit: AYES: NOES: ABSTENTIONS: ABSENT: IN WITNESS WHEREOF, I have hereunto set my hand and affixed the official seal of Orange County Sanitation District this 17th day of December 2025. Kelly A. Lore, MMC Clerk of the Board of Directors Orange County Sanitation District ADMINISTRATION COMMITTEE Agenda Report Headquarters 18480 Bandilier Circle Fountain Valley, CA 92708 (714) 593-7433 File #:2025-4638 Agenda Date:12/10/2025 Agenda Item No:12. FROM:Robert Thompson, General Manager Originator: Wally Ritchie, Director of Finance SUBJECT: INFORMATION TECHNOLOGY UPDATES GENERAL MANAGER'S RECOMMENDATION RECOMMENDATION: Information Item. BACKGROUND Staff will provide an update on recent assessments of OC San’s Information Technology Office and Industrial Control Systems. RELEVANT STANDARDS ·Protect OC San Assets ATTACHMENT The following attachment(s)may be viewed on-line at the OC San website (www.ocsan.gov)with the complete agenda package: N/A Orange County Sanitation District Printed on 12/1/2025Page 1 of 1 powered by Legistar™ ORANGE COUNTY SANITATION DISTRICT COMMON ACRONYMS ACWA Association of California Water Agencies LOS Level Of Service RFP Request For Proposal APWA American Public Works Association MGD Million Gallons Per Day RWQCB Regional Water Quality Control Board AQMD Air Quality Management District MOU Memorandum of Understanding SARFPA Santa Ana River Flood Protection Agency ASCE American Society of Civil Engineers NACWA National Association of Clean Water Agencies SARI Santa Ana River Interceptor BOD Biochemical Oxygen Demand NEPA National Environmental Policy Act SARWQCB Santa Ana Regional Water Quality Control Board CARB California Air Resources Board NGOs Non-Governmental Organizations SAWPA Santa Ana Watershed Project Authority CASA California Association of Sanitation Agencies NPDES National Pollutant Discharge Elimination System SCADA Supervisory Control And Data Acquisition CCTV Closed Circuit Television NWRI National Water Research Institute SCAP Southern California Alliance of Publicly Owned Treatment Works CEQA California Environmental Quality Act O & M Operations & Maintenance SCAQMD South Coast Air Quality Management District CIP Capital Improvement Program OCCOG Orange County Council of Governments SOCWA South Orange County Wastewater Authority CRWQCB California Regional Water Quality Control Board OCHCA Orange County Health Care Agency SRF Clean Water State Revolving Fund CWA Clean Water Act OCSD Orange County Sanitation District SSMP Sewer System Management Plan CWEA California Water Environment Association OCWD Orange County Water District SSO Sanitary Sewer Overflow EIR Environmental Impact Report OOBS Ocean Outfall Booster Station SWRCB State Water Resources Control Board EMT Executive Management Team OSHA Occupational Safety and Health Administration TDS Total Dissolved Solids EPA US Environmental Protection Agency PCSA Professional Consultant/Construction Services Agreement TMDL Total Maximum Daily Load FOG Fats, Oils, and Grease PDSA Professional Design Services Agreement TSS Total Suspended Solids gpd gallons per day PFAS Per- and Polyfluoroalkyl Substances WDR Waste Discharge Requirements GWRS Groundwater Replenishment System PFOA Perfluorooctanoic Acid WEF Water Environment Federation ICS Incident Command System PFOS Perfluorooctanesulfonic Acid WERF Water Environment & Reuse Foundation IERP Integrated Emergency Response Plan POTW Publicly Owned Treatment Works WIFIA Water Infrastructure Finance and Innovation Act JPA Joint Powers Authority ppm parts per million WIIN Water Infrastructure Improvements for the Nation Act LAFCO Local Agency Formation Commission PSA Professional Services Agreement WRDA Water Resources Development Act ORANGE COUNTY SANITATION DISTRICT GLOSSARY OF TERMS ACTIVATED SLUDGE PROCESS – A secondary biological wastewater treatment process where bacteria reproduce at a high rate with the introduction of excess air or oxygen and consume dissolved nutrients in the wastewater. BENTHOS – The community of organisms, such as sea stars, worms, and shrimp, which live on, in, or near the seabed, also known as the benthic zone. BIOCHEMICAL OXYGEN DEMAND (BOD) – The amount of oxygen used when organic matter undergoes decomposition by microorganisms. Testing for BOD is done to assess the amount of organic matter in water. BIOGAS – A gas that is produced by the action of anaerobic bacteria on organic waste matter in a digester tank that can be used as a fuel. BIOSOLIDS – Biosolids are nutrient rich organic and highly treated solid materials produced by the wastewater treatment process. This high-quality product can be recycled as a soil amendment on farmland or further processed as an earth-like product for commercial and home gardens to improve and maintain fertile soil and stimulate plant growth. CAPITAL IMPROVEMENT PROGRAM (CIP) – Projects for repair, rehabilitation, and replacement of assets. Also includes treatment improvements, additional capacity, and projects for the support facilities. COLIFORM BACTERIA – A group of bacteria found in the intestines of humans and other animals, but also occasionally found elsewhere, used as indicators of sewage pollution. E. coli are the most common bacteria in wastewater. COLLECTIONS SYSTEM – In wastewater, it is the system of typically underground pipes that receive and convey sanitary wastewater or storm water. CERTIFICATE OF PARTICIPATION (COP) – A type of financing where an investor purchases a share of the lease revenues of a program rather than the bond being secured by those revenues. CONTAMINANTS OF POTENTIAL CONCERN (CPC) – Pharmaceuticals, hormones, and other organic wastewater contaminants. DILUTION TO THRESHOLD (D/T) – The dilution at which the majority of people detect the odor becomes the D/T for that air sample. GREENHOUSE GASES (GHG) – In the order of relative abundance water vapor, carbon dioxide, methane, nitrous oxide, and ozone gases that are considered the cause of global warming (“greenhouse effect”). GROUNDWATER REPLENISHMENT SYSTEM (GWRS) – A joint water reclamation project that proactively responds to Southern California’s current and future water needs. This joint project between the Orange County Water District and OCSD provides 70 million gallons per day of drinking quality water to replenish the local groundwater supply. LEVEL OF SERVICE (LOS) – Goals to support environmental and public expectations for performance. N-NITROSODIMETHYLAMINE (NDMA) – A N-nitrosamine suspected cancer-causing agent. It has been found in the GWRS process and is eliminated using hydrogen peroxide with extra ultra-violet treatment. NATIONAL BIOSOLIDS PARTNERSHIP (NBP) – An alliance of the NACWA and WEF, with advisory support from the EPA. NBP is committed to developing and advancing environmentally sound and sustainable biosolids management practices that go beyond regulatory compliance and promote public participation to enhance the credibility of local agency biosolids programs and improved communications that lead to public acceptance. PER- AND POLYFLUOROALKYL SUBSTANCES (PFAS) – A large group (over 6,000) of human-made compounds that are resistant to heat, water, and oil and used for a variety of applications including firefighting foam, stain and water-resistant clothing, cosmetics, and food packaging. Two PFAS compounds, perfluorooctanesulfonic acid (PFOS) and perfluorooctanoic acid (PFOA) have been the focus of increasing regulatory scrutiny in drinking water and may result in adverse health effects including developmental effects to fetuses during pregnancy, cancer, liver damage, immunosuppression, thyroid effects, and other effects. PERFLUOROOCTANOIC ACID (PFOA) – An ingredient for several industrial applications including carpeting, upholstery, apparel, floor wax, textiles, sealants, food packaging, and cookware (Teflon). PERFLUOROOCTANESULFONIC ACID (PFOS) – A key ingredient in Scotchgard, a fabric protector made by 3M, and used in numerous stain repellents. PLUME – A visible or measurable concentration of discharge from a stationary source or fixed facility. PUBLICLY OWNED TREATMENT WORKS (POTW) – A municipal wastewater treatment plant. SANTA ANA RIVER INTERCEPTOR (SARI) LINE – A regional brine line designed to convey 30 million gallons per day of non-reclaimable wastewater from the upper Santa Ana River basin to the ocean for disposal, after treatment. SANITARY SEWER – Separate sewer systems specifically for the carrying of domestic and industrial wastewater. SOUTH COAST AIR QUALITY MANAGEMENT DISTRICT (SCAQMD) – Regional regulatory agency that develops plans and regulations designed to achieve public health standards by reducing emissions from business and industry. SECONDARY TREATMENT – Biological wastewater treatment, particularly the activated sludge process, where bacteria and other microorganisms consume dissolved nutrients in wastewater. SLUDGE – Untreated solid material created by the treatment of wastewater. TOTAL SUSPENDED SOLIDS (TSS) – The amount of solids floating and in suspension in wastewater. ORANGE COUNTY SANITATION DISTRICT GLOSSARY OF TERMS TRICKLING FILTER – A biological secondary treatment process in which bacteria and other microorganisms, growing as slime on the surface of rocks or plastic media, consume nutrients in wastewater as it trickles over them. URBAN RUNOFF – Water from city streets and domestic properties that carry pollutants into the storm drains, rivers, lakes, and oceans. WASTEWATER – Any water that enters the sanitary sewer. WATERSHED – A land area from which water drains to a particular water body. OCSD’s service area is in the Santa Ana River Watershed.