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HomeMy WebLinkAboutAGENDA BACKUP 10-17-96 ~ Central Contra Costa Sanitary District ~l...'-~~ BOARD OF DIRECTORS Page 1 of 1 li'I.IIBI"II!!III~III&lIi:lilil.i:l:i BOARD MEETIOGc~ober 17, 1996 NO. 4. CONSENT CALENDAR h. DATE TYPE OF ACTION October 14, 1996 AUTHORIZE ATTENDANCE SUBJECT AUTHORIZE ATTENDANCE OF SIX PLANT OPERATIONS DEPARTMENT EMPLOYEES AT THE OCTOBER 24,1996 INFORMATION SHARING PROGRAM IN DENVER, COLORADO, AT A COST OF $5,000. SUBMITTED BY James M. Kelly INITIATING DEPTtOlV Plant Operations Department/Operations ISSUE: Approval by the Board of Directors is required for out-of-state travel, and if the expenses exceed $500. BACKGROUND: The Denver Metropolitan Wastewater Reclamation District (Metro) serves 1.2 million residents and currently processes about 153 mgd. Metro's Central Treatment Plant is highly automated and has been cited as a very cost effective facility by speakers at the AMSA Summer Technical Conference on Privatization. The Conference tour of Metro's plant has resulted in many requests for site visits. In response to these requests, Metro has scheduled an information sharing program on how they used technology effectively to reduce their operation and maintenance costs. This program is scheduled for October 24, 1996. Attending the Information Sharing Program will give the Plant Operations Department employees first hand knowledge and understanding of practices and procedures put into place at Metro that reduced operations and maintenance staff and reduced operating costs, while consistently meeting permit requirements. Dale Ohda, Plant Maintenance Superintendent, Theodore Smith, Plant Operations Superintendent, Wayne Miner, Machine Shop Supervisor, Bill Hammett, Electrical Shop Supervisor, Philip Huntsman, Plant Operator III, and Garth Williams, Control Systems Engineer are proposed to attend the program. Metro has reduced staff operations shifts (allowed by automation), which has freed up Plant Operators to perform other tasks. Metro has also recently implemented a maintenance management system that has helped reduce their maintenance costs. The Plant Operations Department is considering shift staffing similar to that currently used by Metro, and the Plant Operations Department is currently implementing a new maintenance management system. Our supervisors and employees, who will be on the front line making similar changes, will be more capable of facilitating change after witnessing Metro's programs, how they function, and the savings results, while maintaining an excellent safety record and regulatory compliance program. Participation in this program was budgeted in "Benchmarking Visits" under Technical Services, Account No. 09-02 and is part of the District's Work Redesign activities. RECOMMENDAll0N: Authorize attendance of six Plant Operations Department employees at the October 24, 1996, Information Sharing Program in Denver, Colorado, at a cost of $ 5,000. S:\POSPAPR\ 1 996-97\DENVER.PP \. Jt.t< AfID RECONMENDED FOR BOARD ACT10N INITIATING DEPARTMENTtOlVISlON fp 9/16/96 ~ Central Contra Costa Sanitary District BOARD OF DIRECTORS Page 1 of 8 BOARD MEETING OF October 1 7, 1 996 NO. 6. BIDS AND AWARDS a. DATE TYPE OF ACTION October 11, 1996 AUTHORIZE RELIEF OF BID/AUTHORIZE AWARD SUBJECT APPROVE REQUEST OF RELIEF OF BID FROM SHOEMATE BUilDINGS, INC./AUTHORIZE AWARD OF A CONSTRUCTION CONTRACT TO C. OVERAA & CO. FOR THE HOUSEHOLD HAZARDOUS WASTE COLLECTION FACilITY PROJECT, DP 7165, AND AUTHORIZE CONSULTING AGREEMENT WITH EMCON SUBMITTED BY Don E. Berger, Associate Engineer INITIATING DEPTJOIV Engineering Department/Plant Engineering Division ISSUE: On October 2, 1996, sealed proposals were received and opened for construction of the Household Hazardous Waste Collection Facility (HHWCF) Project, District Project No. 7165. The Board of Directors must authorize award of the contract or reject bids within 50 days of bid opening. The Board of Directors should decide whether or not to grant a request of relief of bid. Authorization by the Board of Directors is required for the General Manager-Ghief Engineer to execute professional engineering agreements when the cumulative amount is greater than $50,000. BACKGROUND: The predesign for the HHWCF project, completed in May 1996, included site and floor plans describing the location, size, traffic circulation patterns, and major design features of the HHWCF, and building elevations which depict the architectural style and color selections. In August 1996, the County land use permit was obtained; this allows the project to move into the final design and construction phases. Construction bid documents were subsequently prepared using a design/build approach, similar to that previously used for construction of the District's Mechanical Maintenance and Materials Control Building. This approach requires the contractor to finalize the design as well as construct the facility and has the advantage of reducing the time needed to complete the project. The HHWCF project consists of construction of a 4,500 square foot metal building with approximately 4,300 square feet of canopied areas; construction of associated site improvements such as parking areas and driveways; and demolition of the existing metal building at the site. The project location is shown in Attachment 1. The construction contract for the HHWCF also includes the following work originally included in the Landscaping and Parking Improvements Project, District Project No. 8165: demolition of the concrete paving at the fonner batch plant property; construction of a new auxiliary parking area; installation of a recycled water line from the treatment plant; and grading and drainage for the areas to be landscaped. This work totals approximately $200,000 and was included in the HHWCF contract in order to ensure that there is ample time to install the landscaping prior to the scheduled opening of the HHWCF. The landscape installation (planting and irrigation) will be bid later and completed concurrently with the HHWCF project. The Landscaping and Parking Improvements Project is included in the Rscal Year 1995-96 Capital Improvement Budget beginning on page GI-26. The HHWCF Project was advertised on September 5 and 11, 1996. The engineer's prebid estimate for this project was $1,200,000 (including $200,000 for the work from the Landscaping and Parking Improvements DEB WEB RAB INITIATING DEPARTMENTJOIVISION ? ~5 ~ PED\H :\PP\ 7165A WRD.DEB 9/16/96 DATE October 11, 1996 Page 2 of 8 SUBJECT APPROVE REQUEST OF RELIEF OF BID FROM SHOEMATE BUILDINGS, INC./AUTHORIZE AWARD OF A CONSTRUCTION CONTRACT TO C. OVERAA & CO. FOR THE HOUSEHOLD HAZARDOUS WASTE COLLECTION FACILITY PROJECT, DP 7165, AND AUTHORIZE CONSULTING AGREEMENT WITH EMCON Project). Three bids ranging from $1,049,500 to $1,345,000 were publicly opened on October 2, 1996. A summary of these bids is shown in Attachment 2. The apparent low bid is from Shoemate Buildings, Inc., in the amount of $1,049,500. The bids were opened at 2 p.m. on October 2, 1996. At approximately 3 p.m., the District telephoned Shoemate to advise them that they were the apparent low bidder. At that time, Shoemate indicated that it had made a substantial error and requested that its bid be withdrawn. At 3:43 p.m., the District received a facsimile copy of a letter from Shoemate requesting that its bid be withdrawn (Attachment 3). At 8:30 a.m. the following morning (October 3, 1996), Shoemate met with District staff to explain and document the clerical error. The Shoemate representative explained on October 3, 1996, that approximately 10 to 15 minutes before bid time they received a subcontractor bid from Joe Carone, Inc. which included site work and demolition. Joe Carone's bid for demolition was less than a previous subcontractor bid for demolition received from the Penhall Company. The error inadvertently occurred when Penhall's bid for demolition was subtracted from Shoemate's bid sheet subtotal and Carone's bid for demolition was added. Had Shoemate not made this error, its bid would have been $1,135,403 instead of $1,049,500, or $85,903 higher than Shoemate's submitted bid. The detailed bid calculation sheets submitted by Shoemate support Shoemate's explanation that the adjustment for the demolition bid from Carone was made incorrectly. On October 4, 1996, within five days of the bid opening, a letter was received from Shoemate setting forth the above explanation (Attachment 4). Under California Public Contract Code Section 5103, a bidder may request relief of bid within five (5) days of bid opening in the event of a clerical error or arithmetical error in preparing the bid proposal. The law is stringent with regard to relief from bids and allows relief to be granted by the awarding authority only under specific circumstances. Specifically, the law states that: "The bidder shall establish to the satisfaction of the court that: a. A mistake was made. b. He or she gave the public entity written notice within five (5) days after the opening of the bids of the mistake, specifying in the notice in detail how the mistake occurred. c. The mistake made the bid materially different than he or she intended it to be. d. The mistake was made in filling out the bid, and not due to error in judgement or to carelessness in inspecting the site of the work, or in reading the plans or specifications." The error cited by Shoemate is the failure to correctly adjust its subtotal using the revised demolition bid from Joe Carone. The documents submitted by Shoemate the morning after the bid opening tends to substantiate its explanation. The total error of $85,903 is significant on a $1,200,000 project, especially for a relatively small contractor such as Shoemate. Although Shoemate would still be the apparent low bidder, the law does not allow acceptance of the higher price, and the only allowable alternative is to withdraw Shoemate's original bid. DATE October 11, 1996 Page 3 of 8 SUBJECT APPROVE REQUEST OF RELIEF OF BID FROM SHOEMATE BUILDINGS, INC./AUTHORIZE AWARD OF A CONSTRUCTION CONTRACT TO C. OVERAA & CO. FOR THE HOUSEHOLD HAZARDOUS WASTE COLLECTION FACILITY PROJECT, DP 7165, AND AUTHORIZE CONSULTING AGREEMENT WITH EMCON Under the above Public Contract Code provisions, the error, as explained by Shoemate, conformed with the conditions required to be released from the bid. Accordingly, Shoemate is entitled to relief under the above provision. The Plant Engineering Division conducted a technical and commercial evaluation of these bids and has concluded that, in the event that Shoemate is granted relief from its bid, the second low bidder, C. Overaa & Co., is the lowest responsible bidder for the bid amount of $1,279,999. District staff will administer the construction contract. EMCON will provide construction engineering services including review of the contractor's design submittals, shop drawing review, assistance with responses to contractor questions, and design of an infonnational display kiosk. Greenfield Environmental will provide the initial employee training and will provide staff experienced in the operation of permanent collec1ion facilities to work with District employees during start-up of the facility. The project budget also includes the costs for the equipment needed to run the facility. The total of previous Board authorized agreements with EMCON is $94,100. This work included completion of the predesign, prepara1ion of the construction bid documents, bidding services, and assistance in obtaining the land use permit. Since that time, staff has authorized two agreements with EMCON for $28,000 and $7,900. This work included assistance in obtaining the remaining state and local permits required to operate the facility and additional work associated with the land use permit. An agreement for $24,000 has been negotiated with EMCON for construction engineering services. Although the proposed agreement does not exceed $50,000, the cumulative total since the previous Board authoriza1ion does, and where the cumulative total exceeds $50,000, the Board is required to authorize the agreement. The Household Hazardous Waste Collec1ion Facility Project is included in the Capital Improvement Budget starting on page TP-97. A post bid/preconstruction cost estimate is presented in Attachment 5. An allocation of $1,831,000 is required to complete this project. Staff has conducted a cash flow analysis of the Sewer Construction Fund and concluded that adequate funds are available for this project. In compliance with the District's CEOA Guidelines, a Mitigated Negative Declara1ion was prepared for this project and approved by the Board on April 18, 1996. A Notice of Determination has been filed with the County Clerk. RECOMMENDATION: Approve the request for relief of bid from Shoemate Buildings, Inc., and direct staff to return Shoemate's bid bond. Authorize award of a contract to C. Overaa & Co., the lowest responsible bidder, in the amount of $1,279,999 for the construction of the Household Hazardous Waste Collection Facility Project, District Project 7165. Authorize the General Manager-Chief Engineer to execute an agreement with EMCON for construction engineering services. Page 4 of 8 ATTACHMENT 1 HOUSEHOLD HAZARDOUS WASTE COLLECTION FACILITY, DP 7165 PROJECT LOCATION IMHOFF OR J/ /> -/ n:\pIont\7ti5\ott.dl)'l I o 7- 200 FEET Page ~ of -1i. Attachment 2 Central Contra Costa Sanitary District SUMMARY OF BIDS PROJECT NO. 7165 - Household Hazardous Waste Collection Facilitv DATE October 2. 1996 LOCATION Martinez. California ENGINEER EST. $ 1.200.000 No BIDDER BID PRICE 1 Shoemate Buildings, Inc. $1,049,500 1007 East Fulton Street Stockton, CA 95208 Telephone No. (209) 464-7741 2 C. Overaa and Co. $1,279,999 200 Parr Boulevard Richmond, CA 94801 Telephone No. (510) 234-0926 3 West Bay Builders Inc. $1,345,000 615 Lindaro Street San Rafael, CA 94901 Telephone No. (415) 456-8972 BIDS OPENED BY /5/ Paul Morsen DATE October 2. 1996 SHEET NO. l OF--1 PED\L:\7165\BidSumm.Frm DEB:lbp ATTACHMENT 3 Page ~ of ~ Cont. Lic. #470637 1007 East Fulton Street Mail to: P.O. Box 8432 Stockton, CA 95208 (209) 464-7741 FAX (209) 464-7765 October 2,1996 Dr. Don Berger central Contra Costa Sanitary District 5019 Imhoff Place Martinez CA 94553-4392 Fax (510)676-7211 RE: Household Hazardous Waste Collection Facility, Project 7165 Dear Mr. Berber: After closer examination after bid time a clerical error has been discovered which would change our bid amount total to $1.135.403. We are hereby requesting that our bid be withdrawn unless this corrected bid amount can be accepted. Let me know if any questions exist. ~-- Sincerely John Shoemate President jsjlc ATTACHMENT 4 Page 7 of 8 1007 East Fulton Street Mail to: P.O. Box 8432 Stockton, CA 95208 (209) 464-7741 FAX (209) 464-7765 ConI. Uc. #470637 October 4, 1996 Central Contra costa Sanitary District 5019 Imhoff Place Martinez, CA 94553-4392 Fax (510)372-7892 RE: Household Hazardous Waste Collection Facility, Project 7165 Gentlemen: We wish to provide further clar if ication in regards to our bid withdrawal request of October 2,1996. Approximately 10 to 15 minutes before bid time we recieved a verbal phone bid of $183,000 from Joe Corone, Inc. which included both si te work and demolition. We then deleted the Penhall Co. bid for demolitoion on our summary sheet. An Attempt was made to revize the subtotal wi th out having to re add the entire column of numbers. This is were the error occured. The subtotal should have been $1,024,437 rather than $945,287 as shown on bid item no. 4 column on summary sheet. By adding a 6% mark up and adding the other bid item columns the corrected bid would be $1,135,403. It is my understanding that you are in reciept of the necessary back-up estimate detail. Please cont3ct me if any questions exist. Sincerely, ~ John Shoemate President JS/ce ATTACHMENT 5 HOUSEHOLD HAZARDOUS WASTE COLLECTION FACILITY PROJECT DISTRICT PROJECT NUMBER 7165 POSTBIDIPRECONSTRUCTlON ESTIMATE ITEM DESCRIPTION TOTAL 1. CONSTRUCTION CONTRACT* $1,279,999 Contingency (12 percent) 155.001 $1,435,000 2. CONSTRUCTION MANAGEMENT District Forces - Contract Administration $ 90,000 - Surveying 5,000 - Legal 5,000 - Record Drawings 4,000 - Plant Engineering Division 35.000 $139,000 Consultants - Inspection $ 49,000 - Construction Engineering (EMCON) 24,000 - Testing 14,000 - Geotechnical Engineering 4,000 - Electrical Engineering 4.000 $ 95,000 CONSTRUCTION MANAGEMENT TOTAL $234,000 3. START-UP - Training and Start-up Assistance (Greenfield) $ 25,000 - Equipment 55,000 - Plant Engineering Division 20.000 $100,000 4. OTHER EXPENSES - Building Permit Fees $ 40,000 - Computer Network and Phone System 10,000 - Signage 7,000 - Public Education/display kiosk 5.000 $ 62,000 5. PREBID EXPENDITURES - Planning, CECA, Community Relations $ 98,000 - Predesign/Operations Plan 50,000 - Contract Documents and Bidding 70,000 - Permitting 79.000 $ 297,000 TOTAL ESTIMATED PROJECT COST: $2,128,000 ALLOCATIONS TO DATE: $ 297,000 ADDITIONAL ALLOCATION NEEDED TO COMPLETE PROJECT: $1.831.000 *Indudes $200,000 for work from the Landscaping and Parking Improvements Project, DP 8165. Page -.JL of -.JL PERCENT 100 6.3 0.3 0.3 0.2 2.4 9.5 3.4 1.7 1.0 0.2 0.2 6.5 16.0 1.7 3.8 1.4 6.9 2.8 0.7 0.5 0.3 4.3 6.8 3.5 4.9 5.5 20.7 147.9 Central Contra Costa Sanitary District Page 1 of 10 BOAAD MEETING OF October 17, 1996 NO. 8. ENGINEERING a. DATE October 14, 1996 TYPE OF ACTION ADOPT RESOLUTION SUBJECT ADOPT A RESOLUTION DIRECTING THE PREPARATION OF A REPORT FOR A DEMONSTRATION PROJECT RELATED TO THE INSTALLATION OF PUBUC SANITARY SEWER FACIUTlES IN CONJUNCTION WITH THE GARY WAY CONTRACTUAL ASSESSMENT DISTRICT SUBMITTED BY INITIATING DEPT,t)tV Jay S. McCoy, Infrastructure Division Manager Engineering Department/Infrastructure Division .ISSUE: Adoption of a resolution of intention is needed in order to initiate proceedings for a demonstration project known as the Gary Way Contractual Assessment District. BACKGROUND: A group of property owners whose properties are located on Gary Way in Alamo have contacted the District to obtain information regarding connecting their homes to the District's public sewer system. These homes are currently served by septic tanks that are in various stages of failure. The homes on the east side of Gary Way are immediately adjacent to the 6D-inch diameter San Ramon Valley Interceptor. The District has designated certain points along the interceptor where connections of trunk and main sewers have and will take place. Direct connections of 4-inch private house sewers are not allowed. The homes on Gary Way must, therefore, connect into an 8-inch sewer main extension, such as the one shown on the attached map. Based on current available information, 8 of the 15 property owners on Gary Way are interested in extending the needed 8-inch public sewer. The properties at 19 and 21 Gary Way presently have a point of connection to the public sewer system at an existing manhole designated as M42 on the attached map and, therefore, do not need to participate in the proposed sewer extension. The properties at 5 and 10 Gary Way have sewer service available in Camille Avenue. The remaining 11 properties are included within the boundary of the proposed assessment district. District staff has developed a new approach to assist property owners in paying for sanitary sewer extensions for those areas that have potential health risks due to failing septic tanks and where a traditional assessment district approach is financially infeasible. It is proposed to use the Gary Way area as a demonstration project to test the viability of this new approach. The new approach includes a financial contribution by the District to the cost of the sewer extension. This contribution would be accomplished through the formation of a Contractual Assessment District. The features of the Contractual Assessment H:\PP\GARYWAY.JSM [11~:liiliilllliil.I.11111:i::I.liiiiii~:ilili:il DATE October 14,1996 I Page 2 of 10 ADOPT A RESOLUTION DIRECTING THE PREPARATION OF A REPORT FOR A DEMONSTRATION PROJECT RELATED TO THE INSTALLATION OF PUBUC SANITARY SEWER FACIUTIES IN CONJUNCTION WITH THE GARY WAY CONTRACTUAL ASSESSMENT DISTRICT District include the formation of the District, execution of agreements between the owners and the District, installation of the sewer extension by a contractor employed by the owners, contribution to the costs by the District for the shares of those owners who do not participate financially, and establishment of rebates to reimburse the District for its contribution. When the nonparticipating owners connect their homes to the sewer extension, the District will collect rebates from each owner. There are four reasons for creating this new approach: 1. To address a public health issue by eliminating septic tanks. This approach would be used to eliminate septic tanks only. 2. To take advantage of an opportunity to develop positive community relationships for the District. 3. The new approach will provide a means for the District to aid in the logical and timely extension of the public sewer system. 4. A contractual assessment may be used to finance public improvements to lots or parcels which are developed and where costs and time delays involved in creating an assessment district, pursuant to alternative provisions of the law, would be prohibitively large relative to the cost of the improvements to be financed. The Board, at its meeting on October 3, 1996, indicated a preference for a financial option similar to that used in previous assessment districts formed by the District. The owners will be allowed to select between 1) paying the full amount of their shares initially, and 2) the District financing each owner's share of the project. The financing would be in the form of the District paying the full amount of the owner's share(s) initially, placing charges including interest on the owner's tax bill for ten successive years and, thereby, reimbursing the District by collecting the charges on the tax bills. The full shares of the nonparticipating owners would be paid by the District as stated above. The District would receive a lump sum rebate when each nonparticipating owner or successor in interest desires to connect their home to the public sewer. Owners consent to assessments will be obtained at the time assessments are levied. DATE October 14, 1996 Page 3 of 10 ADOPT A RESOLUTION DIRECTING THE PREPARATION OF A REPORT FOR A DEMONSTRATION PROJECT RELATED TO THE INSTALLATION OF PUBLIC SANITARY SEWER FACILITIES IN CONJUNCTION WITH THE GARY WAY CONTRACTUAL ASSESSMENT DISTRICT This demonstration project will be the first time the District has used the Contractual Assessment District approach. Therefore, it seems prudent to establish some basic guidelines that can be used in the development of this approach. Staff offers the following guidelines: · The minimum number of properties needed to form a Contractual Assessment District will be five. · Only developed properties with homes with septic tanks on them will be considered for participation in Contractual Assessment Districts. · The number of financial nonparticipants shall not exceed 49 percent of the properties within the Contractual Assessment District. · The interest rate for owner's assessments and District rebates will be 8 percent. · The payback period for the owner's assessments will be a maximum of ten years. At the request of the Board, staff will be contacting other agencies to determine what those agencies have done to address similar situations where agencies have contributed financially to foster elimination of septic tanks. The results of the contacts will be provided to the Board at a future meeting. If improvements to the approach and guidelines proposed for the demonstration project are identified, staff will discuss these improvements with the Board before incorporating them into the approach. The first steps in the creation of the new approach are to adopt a resolution indicating the District's intention to designate an area of the District within which contractual assessments are appropriate; to briefly describe the proposed financing for the program; to establish the boundaries of the Assessment District; to set the time, date, and place for a public hearing at which interested persons may inquire about or object to the proposed program; and to direct staff to prepare a report. The report will include: · A map. · A draft agreement specifying the terms and conditions that would be agreed to between a property owner within the contractual assessment area and the District. 111111111111".1.11::1:11111.1::1:1::::1:::1:1 DATE October 14, 1996 I Page 4 of 10 SUBJECT ADOPT A RESOLUTION DIRECTING THE PREPARATION OF A REPORT FOR A DEMONSTRATION PROJECT RELATED TO THE INSTALLATION OF PUBUC SANITARY SEWER FACIUTIES IN CONJUNCTION WITH THE GARY WAY CONTRACTUAL ASSESSMENT DISTRICT · A statement of District policies concerning contractual assessments, including the identification of types of facilities that may be financed through the use of contractual assessments; designation of the General Manager-Chief Engineer as being authorized to enter into contractual assessments on behalf of the District; maximum aggregate dollar amount of contractual assessments; and a plan for raising a capital amount required to pay for work performed pursuant to contractual assessments. The plan shall include a statement of or method for determining the interest rate and time period during which the contracting property owners would pay any assessment. A resolution has been prepared that contains the information mentioned in the above paragraph. Adoption of the resolution is appropriate to begin the process to form the District's first Contractual Assessment District. RECOMMENDAnON: Adopt a resolution directing the preparation of a report for a demonstration project related to the installation of public sanitary sewer facilities in conjunction with the Gary Way Contractual Assessment District. C 0> '" 6. " ~ .2. 0 ~ I " E U g- ...- .C: .. .. .. .. '" ~ , '" <5 '" = .. .. Pa e 5 of 10 N , 150 300 I FEET Central Contra Costa Sanitary District PROPOSED BOUNDARIES OF GARY VVAY CONTRACTURAL ASSESSMENT DISTRICT (e.A.D. No.1) Page 6 of 10 ~~cg~U\w~lQ) OCT 1 0 1996 CCCSO SECRETARY OF THE DISTRICT October 4, 1996 Board of Directors Central Contra Costa Sanitary District 5019 Imhoff Place Martinez, CA 94553 Dear Board of Directors, Thank: you for your time and support of the proposal to make Gary Way a pilot project as a contractual assessment district. We have alerted all the neighbors who will be affected by this and suspect that we'll be at or close to 100% participation. We all appreciate your empathy for our financial burden and your apparent willingness to extend the pay back schedule to 10 years. We feel that will provide sufficient relief and do not see a need to extend beyond that time frame. All of the other provisions seemed to be very fair and acceptable. This proposal is a creative and workable solution to the problem faced by those of us whose homes are in those septic system pockets. Without this support ofCCCSD, most homeowners would never have the means to connect to the sewer system. Sincerely, Gary Way Homeowners Page 7 of 10 RESOLUTION NO. 96- RESOLUTION OF INTENTION TO ORDER A DEMONSTRATION PROJECT FOR IMPROVEMENT IN GARY WAY CONTRACTUAL ASSESSMENT DISTRICT (C.A.D. NO.1) WHEREAS the public health will be best protected by the elimination of failing septic tanks located within the District boundaries; and WHEREAS the construction and installation of a sanitary sewer pipeline, together with appurtenant work and facilities, in areas not presently connected to the sewer system will facilitate the elimination of failing septic tanks; and WHEREAS a demonstration project designed to facilitate said elimination of failing septic tanks is presently being considered; and WHEREAS it would be convenient and advantageous to establish a boundary around an area within which the District and property owners may enter into contractual assessments and make arrangements to finance public improvements to parcels which are developed and where the costs and time delays involved in creating an assessment district pursuant to alternative provisions in the law would be prohibitively large relative to the cost of the improvement. H:\JA Y\RESOLCAD.WPD 1 Page 8 of 10 THEREFORE, the Board of Directors of the Central Contra Costa Sanitary District resolves: 1 . This Board intends to order the following improvement under the authority of the Municipal Improvement Act of 1911, to wit: Construction and installation of approximately BOO-linear feet of sanitary sewer line, together with appurtenant work and facilities located at Gary Way in Alamo, California. 2. This Board finds that the land specially benefitted by the improvement is shown within the boundaries of the map entitled, "Proposed Boundaries of Gary Way Contractual Assessment District (C.A.D. No.1)." 3. This Board intends to levy a special assessment upon the land within the described district in accordance with the special benefit to be received by each parcel of land, respectively, from the improvement. There shall be omitted from special assessment all public streets, alleys, and places and all land belonging to the United States, the State of California, the County of Contra Costa, and this District now in use in the performance of a public function. 4. Where any disparity occurs between the improvement and the effect on the improvement on private property, this Board determines that it is in the public interest and more economical to eliminate the disparity by doing work H:\JA Y\RESOLCAD.WPD 2 Page 9 of 10 on the private property, instead of adjusting the work on public property. Accordingly, work may be done on private property for this purpose with the written consent of the landowner. 5. This District will finance the improvements from the Sewer Construction Fund. This District will finance unpaid assessments over a maximum period of ten (10) years with interest at a rate to be fixed by the District. 6. The procedure for the collection of assessments will be the placement of assessments on property owner's tax bills. The first assessments will be placed on owner's tax bills in fiscal year 1997 - 98. 7. This Board appoints Jay McCoy, Infrastructure Division Manager, as Engineer of Work for this project, and directs the preparation of the report required by Section 5989.22 of the Streets and Highways Code. 8. The amount of any surplus remaining in the improvement fund after completion of the improvement and payment of all claims shall be distributed in accordance with the provisions of Section 10427 of the Streets and Highways Code. 9. A public hearing shall be held on this matter within ninety (90) days of the adoption of this resolution. Notice of said hearing will be given at least twenty (20) days prior to the hearing. H:\JAY\RESOLCAD.WPD 3 Page 10 of 10 PASSED AND ADOPTED this 17th day of October, 1996, by the Board of Directors of the Central Contra Costa Sanitary District by the following votes: AYES: Members: NOES: Members: ABSENT: Members: Mario M. Menesini President of the Board of Directors, Central Contra Costa Sanitary District, County of Contra Costa, State of California COUNTERSIGNED: Joyce E. Murphy Secretary, Central Contra Costa Sanitary District, County of Contra Costa, State of California APPROVED AS TO FORM: Kenton L. AIm, District Counsel H:\JA Y\RESOLCAD.WPD 4 ~ Central Contra Costa Sanitary District BOARD OF DIRECTORS t:I:':':::::':::iiiii:II':':':::::':'::::I:':'Bkit~:ii::jUI':':::::-::::I:':':::::::::ii~:r::?:: BOARD MEETING OF :::::::::;;::::::::..:;::::::::::::::::::::.llj:j:::mm;::;:;ir::;:;:;:::;::::.:::::::::::j: October 17, 1996 Page 1 of 24 NO. 8. ENGINEERING b. DATE TYPE OF ACTION October 11, 1 996 REVIEW AND COMMENT SUBJECT CONTRACT BETWEEN CENTRAL CONTRA COSTA SANITARY DISTRICT, DELTA DIABLO SANITATION DISTRICT, WEST COUNTY WASTEWATER DISTRICT, AND THE CONTRA COSTA CLEAN WATER PROGRAM TO IMPLEMENT A PILOT ILLICIT DISCHARGE ELIMINATION PROGRAM SUBMITTED BY Barton L. Brandenburg Source Control Superintendent INITIATING DEPTIDIV Engineering Dept./P1ant Engineering Div. ISSUE: Staff has been negotiating an agreement to perform inspection activities for the Contra Costa Clean Water Program. A draft agreement has been negotiated, and staff is requesting that the Board review it and comment as appropriate. BACKGROUND: The Contra Costa Clean Water Program plans to have Central Contra Costa Sanitary District, Delta Diablo Sanitation District, and West County Wastewater District conduct inspections for the pilot Illicit Discharge Elimination Program (IDEP). Twelve municipalities in Contra Costa County have agreed to participate in the IDEP. Nine of the ten cities served by the District are participating with the only exception being Danville. The county wide budgeted annual expense is $240,000 with the District's portion being $190,000. When the contract is approved in its final form, the staff plans to recruit a Source Control Inspector position which will be funded by the program. This position was approved in the 1995-96 Personnel Budget contingent upon the successful completion of negotiations with the Contra Costa Clean Water Program. The Board was briefed by staff in December 1 995 on the IDEP inspections and the contract negotiations which were beginning with the Contra Costa Clean Water Program. The Board reviewed the draft Principles of Agreement at that time. It was the Board's direction that staff proceed with detailed negotiations based on the Principles of Agreement. Attached to this position paper is a nearly final cost payment agreement amendment and an agreement for inspection activities. The cost payment agreement is between the cities and County Flood Control (Clean Water Program) while the agreement on inspecting activities is between the sanitary agencies and the Clean Water Program. The agreement changes as noted were made by the cities and County counsel. Although negotiations have been protracted because of all the parties involved, staff believes the effort has been worth while because coordination of stormwater and sanitary agency programs is the best mechanism to work with local businesses to prevent stormwater pollution . To the best of our knowledge no other sanitary agencies in the Bay Area have been successful in negotiating a contract to coordinate with a large number of municipalities in implementing stormwater program inspections. RECOMMENDATION: Review the agreement for inspection activities and provide staff with input so that the agreement may be finalized. ,-~, Zu-{'6i:- Rf\IEWB) AND RECO!.r.4ENDED FOR BOARD ACTION f/JfA fJf# N PED-G L \C: \SOURCE\BART\ILLlCIT. PP 'J'. . ~ ~\~AN /f4~ ~~~ ~ .,<; ~ ~ =..-::; ~ ~~~ ~~~ Make a Oear Difference TO: Kelly Sessions Pat MacDonald Mori Struve Mark Lander Jim Zumwalt Peter Bekey John Lisenko Keith Freeman. Janis Glover Todd Tea~hout Joye Fukuda Catherine Walters Bill Brennan Paul Causey Jack Foley FROM: i-~"~:~r:'::'~t "'. r~ -:~---. V ...- 1 ;'- ~ \J r- I' ~ t r"'~"" .~." ;:!.";'::'~:'~'l i f OCT-2J996 ~ f f ~ ! L .._~ 1. ' ;:-'Lf: \~T ~;-~ :,;~:;~~ r~'.: 'f :r:. Donald P. Freitas Program Manager DATE: October 1, 1996 Clayton Concord EI Cerrito Lafayette Martinez Moraga Orinda Pinole Pittsburg Pleasant Hill San Ramon Walnut Creek Central Contra Costa Sanitary District Delta Diablo Sanitation District West County Wastewater District Donald P. Freitas, Program Mana SUBJECT: Revised Cost Payment Agreement Amendment and Agreement for Inspection Activities This memorandum summarizes comments and s~ggested changes received on the two agreements for inspection services. The changes to the amendment are listed first followed by the changes to the agreement. . AMENDMENT CHANGES Recommended changes were received on the amendment to the cost payment agreement for inspection services between the Flood Control District and each participating municipality. The attached revised amendment shows these changes in shaded and "strike-out" text. All changes are acceptable to County Counsel. We will make these changes if they are acceptable to each municipality. 255 Glacier Drive, Martinez, (A 94553-4897 · Tel: (510) 313'2360 Fax: (510) 313-2301 Program Participants: AntiQ(h, (layton, (oncord, Donville, Ef (errito, Hercules, lofoyelle, Martinez, Moraga, Orindo, Pinole, Pillsburg, Pleasant Hill, Richmond, Son Pablo, Son Raman, Walnut Creek, (onlro (oslo (ounly and (onlro (oslo (ounlv flood (onlrol and Water (onserv"l;on m,lrirl 6i?\ < r. ;' ... AGREEMENT CHANGES Suggested changes were also provided on the agreement for inspection services between the Flood Control District and sanitation districts. The original agreement is attached. All following changes have been reviewed by County Counsel. We will incorporate these changes if they are acceptable to the sanitation districts. The changes are as follows: Page 1. first paragraph: "This Agreement is made this day of Fcbrua~, 1996, by and among the Contra Costa County Flood Control and Water Conservation District (Flood Control District) and the following three sanitafYt.tB agencies (Agencies): Central Contra Costa Sanitary District (CCCSD); Delta Diablo Sanitation District (DDSD); and, West County Wastewater District 0NCWD). II The term "Flood Control,'; when it appears immediately before the word "District, II should be deleted from the entire document after this first paragraph. Page 1. Recitals. first paragraph: "WHEREAS, the County of Contra Costa, the Flood Control District and seventeen cities in the County of Contra Costa (Contra Costa Cities) joined to form the Contra Costa Cities/County/District Stormwater Pollution Control Program, also known as the Contra Costa Clean Water Program (the Program); and. . ." Page 2. Recitals. last paragraph: "WHEREAS, ~ of the Contra CostaCities, namely, ~oncord, Claytonll.ltl1lll, Lafayette, Martinez, Moraga, Orinda, Pinole, Pittsburg, Pleasant HiII~ __ and Walnut Creek (Participating Municipalities), have by contract authorized the Flood ContmlDistrict to enter into and perform the terms of this Agreement on behalf of the Participating Municipalities. II Page 3. Section 2. Termination: "Any of the three (3) Agencies may terminate its obligations under this Agreement, in its sole discretion, by giving all other parties _J!i~i:~ at least six (6) months' written notice. Flood Contr-ol District may terminate; < , C,'N b 0 i)l ..., G mt'N' '*Y;,,,,,I jC - <' ';11~l't 'j:; : ~~ 1::oJ ~K~~ "'" ~J~$. ~U)l~ . ,;j. .';:?~;:.-\~1S~r: 0 2 this Agreement, in its sole discretion, upon giving the Agencies ~t least six (6) months' written notice." ~rrXG ; c ~lf jlC)l~H ~ Page 3. Section 3. Modification: "This Agreement may be modified by written agreement of the parties. __ ~(~JmS?, ~ llr~ ~Hil. r~ ;;., Jilt;) ". - 61 .9< [~Th'\ ~Uj' ~~Jl Tf Q e IN:iSH clIl:l~) 5~ ~ 'A '(~j!@X i' Page 5. Section 5 (a): "To cause~gjthe Participating Municipalities to draft and to adopt such ordinances and laws as are necessary to effectuate the IDEP, including delegation of necessary authority to the Agencies." Page 5. Section 5 (b): "To authorize and prioritize inspections and investigations, with ~ from the Participating Municipalities and Agencies." Page 5. Section 5 (d): "To nitiate actions against Program and IDEP violators except to the extent enforcement has been initiated on behalf of Participating Municipalities by the Agencies, pursuant to lawfully delegated authority." 0iL~~Si !r ~ J)~%)f~)~):n;:H~1 f :;JnJD1~-:mJJEJ il'l, ,ufWff~ I' 10 Page 6. Section 5: "[I 're) ni"r'l::.J~'1 tIC), fy Ff?lriI01~};tnrxtJ 1/ !Jrf@JWgiDn;.~ 0r ~~(~~1.rj,~~nrl~I''';{lfm)lf~1[f@ 1I!,~lfJt~;l%l i1r~ 'jjll'{:)~@,n JrJ~ IPr',0fI@m II ir'~) 'f)fSY>i@;? 'f!lJi,j(;.J1 Y rg t--i~ ~1~~~Nh:. (,~~;)0fk~ l0 ., ;liHEJltmflf~ J'j un 0t(i@ 1~1~ - Page 6. Section 7. last sentence: "The Agencies shall promptly notify the flood Control District if the Agencies believe that legal costs will be incurred in connection with the IDEP so that the Flood Contml District may rovide pertinent legal ~Jfj@JJsl Y ','8J1Ft fJ~ Ji1Yil,~ 'J:il}L~,}Y,;l.nflfJ '[')n:mJ9J~Y'.dlJ!~1 YS jEJ · 3 ) services on behalf of Agencies, if the Flood Control Districtllml_ so chooses." Page 7. Section 7 (e): "Prior to the beginning of each fiscal year, Hood Control District shall approve an IDEP budget, including individuallDEP budgets for each of the agencies. &)E~ .--,~-A~ Discussions for the annual budget ~ begin ilIJanuary-4-5 prior to the fiscal year in question. The Agencies shall not exceed their approved written IDEP budgets, absent written consent of Flood Control District." ,r:;l ~J~)fr[c; ~ljlflIJ II tBJC.l.~ ~K~'It~'Il,t{lrr~ ::J~1c .Il__ - <fl~: G - t rl~lHE f~ I r@ FJf@:l:S rillJ l1Jp ~~g_ J~(~f,'. ~.~- Page 8. Section 9: "Indemnification. Flood Control District shall indemnify, defend and hold harmless the Agencies and each of them and their officers, directors, agents! and tfleit: employees from and against all suits, actions, legal or administrative proceedings, claims, demands, damages, consequential damages, liabilitiesl and expenses arising out of or related to the Agencies' collective and individual performance in this Agreement. This indemnification shall not extend to any Agency whose active negligence~ erwillful misconduc_ ~as resulted in such suits, actions, proceedings, claims, demands, damages, liabilities or expenses, nor to any Agency whose sete_ negligenceJ er-willful miscondu~has resulted in Regional Water Quality Control Board fines, . . penalties or proceedings. . ~ ciJmYf) ~ ~r\ii ; .6J~ : ff lith.!}?'1 ',.Q_" :- f ~ ;i)f]c tEl f 'f @1f'111 - :\ r: ~SJf);.::rfrlWJ~n ;) :'i "Iff. cr::@, av " ~lrK ;f):s.~~F}"~~~. ~lfr& ,'(; ~0 ~0 j\I~~ :;'1'fC me :l.(~ WI '~'lD fly l'l;~j cJ~m'@.J ~I' [!J jJJ ~.0~ e ~ IS r m ~r;:i, AI!! ~ 1'1 Tft(J f\ ~ _l~ Jno ~ffH1 n.~1lrmJ ~ r~'-, 1> -~!fli9jjTFlt,'.: :x"""p ~jf '. ~fX~ J.c:;rf@,~, <'.'r:.:. e e :,.- ~JJUl mJej) ~J~l 'tl~ci '~.;P .~ r dJ1Yl ~~ I f)~ j$ c.~ 0 ..0:0ItKg), ,!}} ~J.~U~J ~Jf\9. 'Jv ~r;J ,~ 4 a~_TllB~ ;m rSiSimL~~;m~flS~:)r:;)JlJS) f)~Wc)rs)r [9 ;:t~J~' C:!t ~'~-.;Df~,j:) ~n:, c/'f... ~r}!,'J, c;~~ g Jb~, 00 #3~sh@ ilflo lr 0 ,:!l:m:Jf ,'0~J, Sln;Ilirr),~~ n) jj @ ils ~au@ml9:~~.L 8M '_!J -, lQ) ~~,; > ~'J~,'E).r, e " f,,(; ~~f 0tf;~~ ~S5,.~)X~ f ~txsm, ~11 B [r11'1~11,fHl~,i:0j' ~~, ? - ~ C 6;,)11 ~ Please let us know by October 14, 1996, ifthese revisions are acceptable. Should you have any questions, please call me at (510) 313-2373 or Ephraim D. Leon-Guerrero at (510) 313-2364 ELG:sl g:\FLDCTL\NPDES\comcpa.t9 FILE: 050-080-003-002 cc: E. Leon-Guerrero, Planning Specialist 5 -- ATTACHMENT: AMENDMENT TO COST PAYMENT AGREEMENT ~ .., 5~BBlAMENDMENTTO STORMWA TER UTILITY AREA AND PROGRAM GROUP COSTS PAYMENT AGREEMENT BETWEEN CONTRA COSTA COUNTY FLOOD CONTROL AND WATER CONSERVATION DISTRICT AND DRAfT This AMENDMENT, entered into .on the _ day of , 1996, is between the City IT own of , a municipal Corporation of the State of California, and County of Contra Costa, a political subdivision of the State of Califomia, collecthfely hereinafter "CITYf' and Contra Costa County Flood Control and Water Conservation District, a political subdivision of the State of Califomi~ ~, hereinafter "DISTRICT." This IIIImJAMENDMENT amends the Stormwater Utility Area Program Group Cost Payment Agreement Between DISTRICT and CITY entered into on the _ day of ,1993. ~~g@fl:~ ~S)mrX~ if., mf:~~M'@fF15 Y~JS WE1rl?~ @l1ti .0 ~ .-,IJ,!- t ",. ,fJ'J "~.~ ~.: The parties to this AMENDMENT mutually agree and promise as follows: 1. ILLICIT DISCHARGE ELIMINATION PROGRAM: CITY, in order to meet the requirements of the Joint Municipal National Pollutant Discharge Elimination System (NPDES) permit for stormwater discharges, must implement an Illicit Discharge Elimination Program (IDEP). DISTRICT, on behalf of CITY, will execute an agreement with Central Contra Costa Sanitary District, Delta Diablo Sanitation District and West County Wastewater District '~II'~' for implementation of IDEP outlined in Exhibit "A:" ~_ __ Implementation of IDEP and enforcement activities is subject to direction of CITY. CITY's prorated share of the eests ~-m for the IDEP shall be based on the distribution shown in Exhibit "8-;" ~~~ Annually by May 1, CITY and DISTRICT will agree on IDEP activities and eests ~o be accomplished during the subsequent yeargj,t ~'_b~~. c J(@189Y', r)J:) y~ ;1.i@)r:m:=-- .. , .. - c. . -;; ,q)1;1 Jl~. @l~9),' ~ t:Imll ~ .. ~, s .. ltm~ ~ (NJjBMN~~~""~~._~~S~~~R~E~~..~lfiln"d8N~~lm~l ~_~!iW1YBf'[~l~ ~~OOfVJ~n-.~A:~~im"n ~":.,:,,,,,,,,,:&"~~... .. ._....... ..' . .;e~ DRAFT ill y~ : ,-: J ii @r1J' c Y~8-;) Jrf)j)] ~J n$ 'S e ';' @)nc ~r191r' r;-~~~)9:~!.IY~ ~0i11!BE]8' ;Jii ff r1hl1YfiJ\f?'~!0(}~1~~ r}ff,:';', ~ ;i1rr~. 0 A '0 ffiam~rl.t >~~~!! c; f. l'l~ . -~e,~~jt- ....~ C'.,.. ,'-' >>-ifI.;. ~-~DIrl!!ttiltti11~t~ . UIDl G ~ @,~m CONTRA COSTA COUNTY FLOOD CONTROL AND WATER CONSERVATION DISTRICT By: Chair, Board of Supervisors ATTEST: Phil Batchelor, Clerk of the Board of Supervisors and County Administrator By: Deputy Recommended for Approval: J. Michael Walford Chief Engineer By: Form Approved: Victor J. Westman County Counsel By: Deputy DPF/sj g:\... \npdes\jepa2.96 File: 010-280-000-000 050-080-003-002 02115/96 rev.: 04/15/96 07/16/96 09130196 DRAFT CITYITOWN OF By: CitylTown Manager ATTEST: CitylTown Clerk By: Recommended for Approval;.... CitylT own Engineer By: Form Approved: CitylTown Attorney By: EXHIBIT "A" Agreement for Inspection Services f10''01EJ (f1HS ON XH/X.L] OC:CT <um 96/H/Zo DRAFT 2/13/96 AGREEMENT AMONG THE CONTRA COSTA COUNTY FLOOD CONTROL AND W ATERCONSERV ATIONDISTRICT (ON BEIlALFOF THE.CONTRA COSTA CLEAN WATER PROGRAM), THE CENTRAL CONTRA COSTA SANITARY DISTRICT. . THE DELTA DIABLO SANlTATIONDISTRICf AND TBE WEST COUNTY WASTEWATER DISTRICT . _ REGARDlNGTBE CONTRA COSTA CLEAN WATER PROGRAM. This Agreement is made this day of Febxuary, 1996, by and among the. Contra Costa CQuntY Flood CcJntrol and Water CoDsetV8.tion District (Flood Control District) and the followingtbree sanitary agencies (Agencies): Cen1Ial CoD1ra Costa Sanitaxy. District (CCCSD); Delta Diablo Sanitation District (DDSD); and West Coun1y Wastewater District (WCWD). RECITALS W1IBJ.mAS. the County of Contra Costa, the Flood Control District and Seventeen Citie$ in the County of Contra Costa (Contra Costa Citiesfjoined to form the Contra Costa - CiticslCounty/District Stormwater ~olluti.on Control Program, also known as the.Co~ Costa Clean Water Program. (the Program); and WHEREAS. the membeJ:s of the ProgIaDl jointly applied for and were jointly issued NPDES StormwateJ:' PeJJJJit Nos. CA 0029912 and CA 0083313; and 1 f:\OHS\HC.OlR\Ol29198.02 p, .7T (""lr ._T..........-.. soo lEI (HCS ON XH/X.LJ Oc: C 1 aHM 96/l>'T/ZO ~-- DRAfT 'WHEREAs. an enforceable component of the NPDES permits is the document entitled nA Stormwater Management Plan for the Contra Costa Cities/County/District Stonnwater Pollution Control Program" dated "May 1.1993 (the Plan); and WHERE.A.s. the Plan contains as one of its components the prevention of pollution through illicit discharge identification and eJjmin~tion; and WHEREAs. the Agencies wish to provide services for the DJicit Discharge Elimination Program (IDEP). which is currently being developed by the Program, as part of the implementation of the Plan; and 'WHEREAs, the Plan bas identified long-term IDBP goals of eliminating illegal dumping into municipal storm drain systems and creeks. inspection of municipal storm drain sysrems to locate and eliminate illicit discharges from ~mmercial and industrial facilities and residences, and inspection of commercial and industrial facilities to eliminate illicit connections and discharge resulting from illegal processes, activities or housekeeping practices; and WHEREAs, the Agencies and the Flood Control District undertake this Agreement in the spirit that the; public good is best 6elVed by modifying the Agencies' existing ptetreatment programs to encompass a stormwater illicit discbarg~ eJimin~tion program;" rather than establishing new. unique' inspection programs to effect" the goals' of this " Agreement; and WHEREAs, ten (10) of the Contra Costa. Cities, namely, Concord. Clayton. Lafayette, Martinez. Moraga, Orinda. Pinale, Pittsburg. Pleasant Hill and Walnut Creek (Participating Municipalities). have ~y contract authorized the Flood Control District toq 2 f:\DMS\KC.OlR\0129198.02 8E=cI 96, vI R~~ <::01--' C.C-h ....-,.,.. .--... .... .--..-- 90'0 I2J (HtS ON nIlY.L) Ol:: n OHM 96/H/ZO DRAF'l.. ~ .'. '....iii ;:.< \:;<1 ~. .j ., t\ .. enter into and peIfoDD. the t.enns of this Agreement on behalf of the . Participating Municipalities. NOW. lHERBFORE. the parties to this Agreement agree as follows: 1. TenD... The term of this Agxeement shall be from the date all four (4) parties have executed this Agreement until June 30. 1998. The panies shall negotiate renewal of the Agreement beginniT1g six (6) months prior to the expiration of the Agreement. 2. Termination. Any of the three (3) Agencies may temrinate its obligations under this Agreement, in its sole. discretion. by giving all other parties at least six (6) monthsY written notice: Flood Control District may terminate this Agreement, in its sole discretion, upon giving the Agencies at least six (6) months' written notice. All rma.ncial obligations among the teJ:m.joati'lg party and the reroajn~ne parties shall be prorated as of the date of termination. 3. Modification. This Agxeem.ent may be modified by written agreement of the parties. 4. Responsibilities of the A~encies. The Agencies have the following collective responsibilities under this Agreement within their respective service areas, including areas served pursuant to contract: (a) To implement k IDEP, subject to the direction of the Flood Control District, and to bill the costs of the IDEP to the Flood.Control District. .. (b) To perform scheduled and other inspections and investigations of commemial and industrial facilities and residences to determine compliance with federal, state and loc::allaws and regulations related to stormwater discharge. Inspections may have 3 F:\DMS\HC.OIR\0129198.02 6~:ZI 96. vI 8~~ qc:\,.-l I".("'t? l.OO ~ HHS ON XU/X.L] OC: CT G3A\ 96/H/ZO 'D',>'< ' '~~A"':~' F.f':;H~;:...:~ 1 . f\...... ,'h 1,;.:<) r.f ~ ~'Ai\!a M~ fl an educational Compofient, as directed by Flood Control District. The locations and frequency of such inspections, investigations and educational effort shall be at the direction of the Flood Control District, but inspections, investigations and eduCational effort shall take place during the Agencies? normal working hours, as described in Appendix "A. a (c) To prepare inspection and investigation reports. (d) To issue Notices of Violation, Warning Notices and Compliance Orders on behalf of the Participating Municipalities where violations and potential violations occur, all to the extent authority to issue such Notices and Orders has been lawfully delegated by the Participating Municipalities to the Agencies. in connection with inspections and investigations. The Agencies, at the direction of the Participating Municipalities, sha11 also refer violations and potential violations [0 appropriate enforcing entities, such as the District Attorney. (e) To levy fines on behalf of the Participating Municipalities where violations occur? to the extent authority to levy fines is lawfully delegated by the Participating Municipalities to the Agencies. .(t) To keep records regarding inspections and investigations accomplished. (g) To train. supervise and manage staff of the Agencies necessary to impletnent the IDEP. (h) . To provide advice and comments to the Flood Control District regarding . " the Flood Control District's preparation of educational material for distribution to COmmercial and industrial facilities and the public. The Agencies shall also provide advice 4 F:\OHS\"C_OIR\0129198.02 6~:cT 96, p! 83~ I.Vlri FS'17 f1).J'--(71-fU ).Jl-J-'-'-:Jr- ,,~,-.. .....,-"--7 .-. "r,-... ~ ~~ ~ 1;'+;';'~~. Yll!; H FJtt;\.. LJ) t~-~ t! ~:6~ &: '(.~i \1i l~ ~ and comments to the Flood Control District regarding the development of a Clean Business Program, as requested by the Flood Control District. (i) To provide conunentB to the Flood Control District regarding ordin~l]ces necessary to implement the IDEI'. 0> To purchase. operate and In::!intdn all equipment necessary to itnplement the IOEP. at the cost of the Flood Control District. (k) To provide quarterly IDBP activity reports to the Flood Control . District. (1) To utilize reasonable efforts to assure the IDEP' is uniformly implemented by the Agencies. s. Responsibilities of the Flood Control District. (a) To cause the Participating Municipalities to draft and to adopt such ordinances and laws as are necessary to effectUate the IDEP 1 including delegation of necessary authority to the Agencies. (b) To authorize and prioritize inspections and investigations, with input from the Participating Municipalities and Agencies. (c) To provide timely input on the scope of the fo~owing fiscal year IOEP. during budget discussions, and timely approval of the Agencies' fiscal year IDEP budgets. . . (d) To initiate actions against Program ~ IDEP violators. except to the extent enforcement has been initiated on behalf of Participating Municipalities by the Agencies, pursuant to lawfully delegated authority. 5 f;\gMS\MC(OIR\OlZ91~6(O' 600 ~ [HrS ON :nUX.LJ OC:CT aRM 96/tT/ZO - .----- ....D.R~AI~-T _..JJ ': ..~ . . ~ ~'c. .~I . 'i' ..lit.,.. ... .... ~ '. (e) To provide educational materials for distribution to COtt1ttlercial and industrial facilities and the public. (f) To pro~de comments to the Agencies regarding the formats of inspection and investigation reports. (g) To adopt and adminjster a permitting pro~ if any. (h) To make timely payments to the Agencies pursuant to billings for IDEP costs. (i) To perform. other responsibilities as agreed to in writing between the Flood Control District and the Agencies. 6. Cotnmun.ications between Flood Control District and the At!encies. The Agencies will designate an IDBP Facilitator and a1tema~~ subject to the approval of such Facilitator and alternate by Flood Control District. The PUIpOse of this designation is to facilitate communication between Flood Control District and the Agencies. The Agencies sball direct such matters as complaints. claims, legal challenges. and other disputes regarding the IDEP to the IDEP Facilitator. for transferral to Flood Conn-ol DistriCt for hantfTing and resolution. 7. FinanciaL The Agencies shall be reimbursecI by the Flood Control District for all costs related to the IDEP. These costs inclUde, but are not necessarily limited to, labor. benefits. overhead, supplies, equipment. vehicle. laboraooIY. consultant. legal and insurance costs. The Agencies shall promptly notify. the Flood Control District if the Agencies believe that legal costs will be incurred in connection with the IDEP so that the 6 f:\PMS\HC.01R\0129198.02 0v:cI 96, vI 83~ 60d 6n7 {l}...U--4"7I-.(tJ ).JH,'::JC- .H...')'....... t ...............""::>' r-.............. 010 1EJ (lrHS ON XU/X.LJ OC: n OHM 96/H/ZO ...---- -..--.-.----.-- ------- D~ if':'J ~r.u~";I'"'t' ' ~ ti~~ l-\~ ;"1. ;;~., <. <, L\; "-';, b~.... l.i... 'iJ ~k1U ~ Flood Control District may provide pertinent legal services on behalf of Agencies. if the Flood Control District so chooses. (a) Each of the Agencies will. prepare invoices for costs related to the IDEP and submit such invoices to the Flood Comrol District no more frequently than monthly and no less fn:quently than quarterly. Flood. Control District will pay such invoices wirhin forty-five (45) days of receipt. (b) The labor costs sball be itemized at base cost per individual for tin1e spent plus an overhead multiplier for benefits, administrative ovemcad, supplies. eqyipment , . and insurance. The overhead multipliers are set forth in Appendix A. attached hereto and incorporated. herein. (c) To the extent practicable, all invoices submitted sha11 be itemized to allocate costs to the Participating Municipality for which IDEP services were performed. (d) To further cost efficiency, time spent by staff of the Agencies at meetings relative to the IDEP will be minim17ed to the extent practicable. Laboratory services will be similarly rninimi7.ed. (e) Prior to the beginning of each fiscal year. Flood.Control District shall, , . approve an IDBP budget. including individual IDBP budgets foreach of the three Agencies. " Discussions for the anmUll budget will begin January 15 prior to the fiscal year in question. The Agencies shall not exca;d their approved written IDEP budgets, absent written cbnsent of Flood Control District. 8. IIl.SU1'aI1Ce. During the term of this Agreement, the Agencies sluill carry Workers" Compensation and Employers' Liability insurance as required by law, and General 7 fi'~\MC,DIH\Ol~l?O,O, (:::,t? ~ 7 T qr: f_"T- OJ f D'-R.)~ ~ ~'l""""" ;<',' ..';; ;\~ trJa ~~ .~ ~' 'i1&l ~~ ~ Liability and Automobile Liability insurance in the amount of at least one million doIIars ($1,000.000) per occurrence. If one or more of the Agencies are self insured, written notification of this circum.stance shall be made to the other parties within thirty (30) days after the execution of this Agreement. 9. Indemnification. Flood Control District shall indemnify, defend and hold hatmless the Agencies, and each of them. aix1 their officers, directors, agents and employees from and against all suits, actions. legal Or a.dministrative proceedings. claims. demands, damages, consequential damages, liabilities and expenses of any nature arising out of or related to the Agencies' collective and individual performance under this Agreement. This indemnification shall not extend to any Agency whose active negligence or willful misconduct has resulted in such suits, actions, proceedings, claims, demands. damages, liabilities or expenses, nor to any Agent.:y whose sole negligence or wi1Ifu1 misconduct bas resulted. in Regional Water Quality Control Board fines, penalties or proceedings. 10. Notices. Notices required or' permitted under this Agreement shall be hi writing and made as follows: If to Flood Control District, to: If to the Agencies collectively, to: If to CCCSD, to: ~ r!tOWQ\"O.OlO\Of20fOD.01 DRAFT If to DDSDt to; If to WCWD, to: 11. Arbitration. In the event of a dispute arising under this Agreement, the parties may submit such dispute to non-binding arbitration. In the event the parties cannot agxee to an axbitrator within thirty (30) days after a party requests arbitration by written . notice to the other parties, the arbitrator may be selected by petition of any party to the Superior Court of the County of Contra Costa. IN WITNESS WHEREOF, the parties have executed this Agreement as follows: Dated: CONTRA COSTA COUNTY FLOOD CONTROL AND WATER CONSERVATION DISTRICT By: Its: 9 f:\OMS\HC,OIR\0129198,Ol D'.. .. ~~'{j'-.. t~i'~l--".'."'- f" ~~ ~.J.f . .~~ -~i . .' ,... <. lr' .- j~..A';.: ~:.; t:. l:.t~:f 14- . .J,." ti lil.u ~:i U4 Dated: 'CENTRAL CONTRA COSTA SANITARY DISTRICT By: Its: Dated: . DELTA DIABLO SANITATION DISTRICT By; Its: Dated: WEST COUNTY WASTEWATER DISTRICT By: Its: 10 f:\OHS\MCtOlR\0129198.0~ HiI~ [HeS ON XH/X.L] OC:ct mu\ 96/lrT/zo nr\\ fr~ p. t/~\:';..~r.i:~ iJJ U~11~~Uf ~ APPENDIX A AGENCY OVERHEAD MULTIPllER AND NORMAL WORKING HOURS Overhead MulJjplier Normal Workin~ Rours* Central Contra Costa Sanitaxy DiStrict 2.19 7:30 a.m.-4:00p.m. 7:30 a.m.-4:00p.m. Delta. Diablo Sanitation District 2.29 West County Wastewater District 2.10 7:00 a.m.-3:30p.m. ....Monday through Friday, excluding holidays 11 f:\OMS,"C.OIR\0129198.02 Iv:cI 96, vI 83~ vI,.-f h~V (l)...fH7I--ftJ ").1L-f,.:::JC onr-, r"'Ir7 ~""r- EXHIBIT "8" Cost Allocation IlliCIT DISCHARGE ELIMINATION PROGRAM FIRST YEAR COST ALLOCATION MUNICIPALITY . HOURS INSPECTIONS COST Clayton 37 8 $4,205 Concord 565 119 63,475- ~- - ~~ B. ;..,',-;l;....;'fi., Lafayette 120 25 13,463 Martinez 162 34 18,153 Moraga 81 17 9,097 Orinda 84 18 9,461 Pinole 89 19 9,986 Pittsburg 242 51 27,169 Pleasant Hill 160 34 17,991 - - II IIJDD " Walnut Creek 308 65 34,568 TOTAL 1,848 39G $207,568 .. B - ELG:sl g:\fldctl\npdes\lDEAB.17 07/16/96 ~.. ventral Contra Costa Sanital"'f District Page 1 of 28 BOARD OF DIRECTORS ... .................... ... .... ... ................................ . . ...... ... .............. .... .. ... BOARD MEETING OF :::~:~~.~:~I...I;j:I:I:~:Jt~~~~:~:~:i:i:~:~~~~~~~~ 0 t b 17 1996 ~~tm~B"!1~j~~i~i~::::iB~~lmmmmm1~Bllmtr/ coer I DATE October 14, 1996 SUBJECT NO. 11. BUDGET AND FINANCE a. TYPE OF ACTION RECEIVE ANNUAL REPORT, AND ADOPT A RESOLUTION RECEIVE THE 1995-1996 ANNUAL REPORT OF THE DEFERRED COMPENSATION PLAN ADVISORY COMMITTEE, AND ADOPT A RESOLUTION AMENDING THE DEFERRED COMPENSATION PLAN DOCUMENT. SUBMITTED BY Debbie Ratcliff, Controller INITIATING DEPTIDIV Administrative/Finance & Accounting ISSUE: The Deferred Compensation Plan Advisory Committee (Committee) respectfully submits its 1995- 1996 annual report and updated Plan Document to the Board of Directors. BACKGROUND: The Board of Directors approved the establishment of the Committee in January 1982. The scope of activities of the Committee includes: . Establishing internal administrative procedures . Educating participants regarding the Plan . Reviewing emergency withdrawal requests . Reviewing investment performance of the Plan . Submission of an annual report to the Board of Directors and Plan participants The Committee is made up of the following Departmental representatives: Debbie Ratcliff - Darlene Ross - Dennis Hall Ron Galloway - Wayne Miner - Chairperson Administrative Engineering CSO Plant Operations The Committee made several major accomplishments this year; among the most important are: . Updated the Deferred Compensation Plan document to comply with current IRS Regulations (See Attachment I). The law firm of Trucker-Huss, who specializes in benefit law, reviewed and finalized the Plan Document. . Researched the 401 A Plan, which is a supplemental deferred compensation plan that allows additional wages to be deferred over and above the current 457 Plan. The Committee is still researching the 401A Plan and is not ready to make a recommendation to the Board at this time. INITIATING DEPARTMENTIDIVlSION ,M"~ D. . 5 :\ADMIN\POSP APER\ANNRPT .PP ..m......____....__.m..........., REVIEWED AND RECOMMENDED FOR BOARD ACTION j/~r .M. 9/16/96 IllolliloioooloololilliBilllllJ.ioooiioljillliliijiiliilIllil:lllill DATE October 14, 1996 I Page 2 of 28 SUBJ ECT RECEIVE THE 1995-1996 ANNUAL REPORT OF THE DEFERRED COMPENSATION PLAN ADVISORY COMMITTEE RECOMMENDATION: Receive the annual report of the Deferred Compensation Plan Advisory Committee for 1 995-1996, provide any comments to staff, and adopt a resolution amending the Deferred Compensation Plan. Central Contra Costa Sanitary District DEFERRED COMPENSATION PLAN ADVISORY COMMITTEE ANNUAL REPORT JULY 1995 - JUNE 1996 The Deferred Compensation Plan Advisory Committee (the Committee) was established by the Board of Directors to facilitate the internal administration of the District's Deferred Compensation Plan. The scope of the Committee's activities encompass the following: . Establish internal District administrative procedures within the provisions of the Deferred Compensation Plan document. . Educate participants regarding the Plan provisions by issuing a handbook which summarizes the Deferred Compensation Plan and responding to questions from participants. . Review accountability by the Program Administrators, Hartford Life Insurance Company (Hartford), Great Western Bank (Great Western), and ICMA Retirement Corporation (ICMA) and respond to participants' queries regarding accuracy or propriety of account balances. . Review participants' requests for emergency withdrawal of funds. . Review investment performance of the Deferred Compensation Plan on an annual basis. Committee Accomplishments The following activities were completed by the Committee during July 1995 through June 1996: . Internal District Administrative Procedures One new Deferred Compensation committee member was selected and trained to support his respective department. Education workshops were provided on the new features offered by ICMA. The Deferred Compensation Plan document has been updated and has had final legal review. (See Attachment I) However, on August 19, 1996, President Clinton signed the Small Business Job Protection Act of 1996. Included in the bill are many reforms which apply to Section 457 plans. Most of these changes are likely to be effective for calendar year 1997. However, since the new law has not been interpreted by the IRS, and new regulations have not yet been written, the plan document will require additional updating next year. . Review Accountabilitv bv ProQram Administrators The new 800 line feature was monitored throughout the year and has proved to be quite successful. S :\ADMIN\RA TCLlFF\DEFCOMP\ANUALRPT .MEM Page 3 of 28 Six new mutual fund investment options were added to the Great Western Bank portfolio. Monthly confirmation statements and quarterly account statements were submitted to the District by Hartford, Great Western, and ICMA. Quarterly account statements were distributed to all participants. . Review Requests for EmerQency Withdrawals of Funds Three emergency withdrawal requests were reviewed by the Committee, and none were recommended for approval by the Board of Directors. All three were denied as they did not meet the requirements for emergency withdrawal established by the Internal Revenue Service. . Review Investment Performance A summary which presents the investment performance of the Hartford, Great Western, and ICMA programs for the calendar year 1995, and the first six months of 1996 is attached. Current Committee Activities . The Committee is reviewing a 401 A Plan, a supplemental deferred compensation plan, which allows additional wages to be deferred over and above the current 457 Plan. The ICMA representative will be presenting this plan to the management group for evaluation. If received positively, the 401 A Plan will be brought to the Board for consideration. . The Committee is reviewing alternate proposals submitted by competing firms providing Deferred Compensation Plans. Aetna Life and ICMA are both submitting alternate proposals to possibly replace the Hartford program which has limited investment options and whose investment performance has declined over the past couple of years. The Committee will be determining whether or not to bring forth to the Board a recommendation to replace Hartford. . The Data Sheet in the back of the Deferred Compensation Program Handbook will be updated and distributed to all employees in January 1997. Conclusion During the period July 1995 through June 1996, the Committee addressed all of the activities included in its scope of responsibilities through the conscientious efforts of all of the Committee members. The performance of Great Western, Hartford, and ICMA in administering the Deferred Compensation Plan during the 1995-1996 report period is considered to be satisfactory. The performance results of the Great Western, Hartford, and ICMA stock and bond investments for the calendar year 1995 and the first six months of 1996, are as follows: S :\A DMI N\RA TCLI FF\DEFCOMP\A N U ALR PT. MEM Page 4 of 28 [' -..--------.---.---.------.-.-.-..-.... .-..-----------..........-........---.------ Hartford The return on the stock fund for the 1995 calendar year was 32.57 percent which underperformed the general market indices, as measured by the Dow Jones Industrials and the Standard & Poors 500 (S & P 500), which both registered a gain of 36.9 percent and 37.5 percent, respectively. The bond account which earned 17.13 percent underperformed the Lehman Brothers Bond Index which earned 30.72 percent. Through the first six months ended June 30, 1996, the 11.22 percent gain on the stock account outperformed the S & P 500 which gained 8.88 percent and the Dow Jones Industrials which gained 10.50 percent; the loss of 2.34 percent on the bond account outperformed the Lehman Brothers Index, which lost 6.70 percent. Great Western For the 1995 calendar year one stock fund, Vanguard Windsor II, outperformed both the Dow Jones Industrial Average and the S & P 500. Another Fund, Vanguard 500, outperformed the Dow Jones but slightly underperformed the S & P 500. All remaining stock funds underperformed both the Dow Jones Industrial average and the S & P 500. The performance results for the year are as follows: Vanguard Windsor II Standard & Poors 500 Vanguard 500 Dow Jones Industrial Average Fidelity Magellan Fund 20th Century Ultra Fund Fidelity Growth & Income Fund Vanguard Wellington Fund Fidelity Contra Fund Fidelity Equity Income Fund Investment Company of America Growth Fund of America Income Fund of America Vanguard Wellesley Fund Fidelity Retirement Growth Fund 20th Century Select Fund Fidelity Puritan Fund 20th Century Balance Fund 20th Century Growth Fund Fidelity Overseas Fund 38.80% 37.50% 37.40% 36.90% 36.82% 36.72% 35.38% 32.90% 32.19% 31.81 % 30.63% 29.80% 29.08% 28.90% 24.28% 22.67% 21.46% 21.13% 20.03% 9.06% S :\ADMIN\RA TCLlFF\DEFCOMP\ANUALRPT .MEM Page 5 of 28 T --..-.--.--..-.-..----.........---.-.---.-....-... .---......-..-...-..-.--..... ... ..--.----...---------.--------------- Through the six months ended June 30, 1996, five funds outperformed the S & P 500, but underperformed the Dow Jones. The performance results for the six months ending June 30, 1996 are as follows: Dow Jones Industrial Average Vanguard 500 Vanguard Windsor II Fidelity Growth & Income Fund Fidelity Contra Fund Fidelity Equity Income Fund Standard & Poors 500 20th Century Ultra Fund 20th Century Select Fund Investment Company of America Fidelity Overseas Fund 20th Century Growth Fund 20th Century Balance Fund Fidelity Puritan Fund Growth Fund of America Vanguard Wellington Fund Fidelity Retirement Growth Fund Income Fund of America Fidelity Magellan Fund Vanguard Wellesley Fund 10.50% 10.00% 1 0.00 % 9.10% 9.10% 9.00% 8.88% 8.70% 7.90% 7.90% 7.30% 7.30% 6.10% 5.60% 5.50% 4.80% 4.70% 4.70% 2.80% -0.20% Bonds: The Bond Fund of America earned 18.25. underperforming the Lehman Brothers Bond index for calendar year 1995. Lehman Brothers Bond Index Bond Fund of America 30.72% 18.25% For the first six months of 1996, the Bond Fund of America gained .50 percent outperforming the Lehman Brothers Bond Index. Bond Fund of America Lehman Brothers Bond Index .50% -7.50% S:\ADMIN\RA TCLlFF\DEFCOMP\ANNUAl.RPT Page 6 of 28 ----,. .._---------~----~,-~---~----,_..._,...,._._.,_._..__.--,_._-_.~_......"~~-,.__._-.._-~---.-_.,."..-.._..._- leMA Trust Familv of Funds: During the calendar year 1995, one of the stock funds, the Aggressive Opportunities Fund, outperformed both market indices with a gain of 38.6 percent. Three of the stock funds came close to the market indices but did not outperform them. It is important to note, however, that ICMA reports their results net of fees and administrative charges which do not apply to the market indices. The performance results are as follows: Aggressive Opportunities Fund Standard & Poors 500 Dow Jones Industrial Average Growth Stock Fund Equity Income Fund Broad Market Index Fund Asset Allocation Fund Social Responsibility Fund International Fund 38.60% 37.50% 36.90% 35.90% 34.60% 34.40% 28.50% 26.80% 10.20% Bonds The Core Bond Fund gained 18.3 percent during calendar year 1995, underperforming the Lehman Brothers Bond Index. Lehman Brothers Bond Index Core Bond Fund 30.72% 18.30% Mutual Fund Series Information is not available for 1995 as we began acquiring these funds in August of 1995 and did not acquire all of them until January 1996. S :\ADMIN\RA TCLlFF\DEFCOMP\ANNUAL.RPT Page 7 of 28 Trust Familv of Funds: Through the six months ended June 30, 1996, two funds outperformed both market indices. The results are as follows: Aggressive Opportunities Growth Stock Fund Dow Jones Industrial Broad Market Index Fund International Fund Standard & Poors 500 Asset Allocation Fund Equity Income Fund Social Responsibility Fund 16.60% 10.70% 10.50% 9.20% 8.90% 8.88% 6.20% 5.80% 3.30% The Core Bond Fund lost 2.6 percent during the six months ended June 30, 1996, outperforming the Lehman Brothers Bond Index. Core Bond Fund Lehman Brothers Bond Index -2.60% -7.50% Mutual Fund Series: For the six months ended June 30, 1996, two funds outperformed both market indices. The performance results are as follows: Gabelli Value Fund Putnam Voyager Aggressive Growth Dow Jones Industrial Average Standard & Poors 500 Fidelity Growth & Income Fund Fidelity Contrarian Fund 20th Century Momentum Growth Fund Lindner Dividend Income Fund Fidelity Puritan Flexible Fund Fidelity Blue Chip Growth Fund Vanguard Wellington Balanced Fund Fidelity Magellan Capital Appreciation Fund 12.20% 11.40% 10.50% 8.88% 8.60% 8.30% 7.80% 6.90% 5.10% 4.30% 3.90% 2.40% NOTE: Bolded Funds are Market Indices S :\ADMIN\RA TClIFF\DEFCOMP\ANNU AL.RPT Page 8 of 28 Committee Members: ~/'7~-:J Dennis Hall, Engineering J/ -~~~~--.-* stem Operations Department Ron Galloway, Collecti M Wayne .; ~ ADS/Def Comp/Annl.rpt S :\A OMIN\RA TCLlFF\OEFCOMP\ANNU AL. RPT Page 9 of 28 I. ---..---------- LEGEND: 20th Centurv Funds: 20th C. BF 20th C. GF 20th C. SF 20th C. UF Balanced Growth Select Ultra VanQuard Funds 500 Wellg Welly Wind II Fidelitv Funds: Fidelity ElF Fidelity MF Fidelity OF Fidelity PF Fidelity RG Fidelity CN Fidelity GI Equity Income Magellan Overseas Puritan Retirement Growth Contra Growth & Income American Funds: G.W. GFA G.W.ICA G.W.IFA G.W. BFA Growth Fund Investment Company Income Fund Bond Fund ICMA Funds - Trust Familv of Funds: ICMA AGG Aggressive Opportunities ICMA SR Social Responsibility ICMA CMF Cash Management ICMA CBF Core Bond ICMA UST U.S. Treasury Securities ICMA AAF Asset Allocation ICMA ElF Equity Income ICMA BMIF Broad Market Index (formerly Equity Index) ICMA GSF Growth Stock ICMA IF International ICMA Plus Plus Fund Mutual Fund Series: Gab Val Put Voy Fidelity G & I Fidelity CTR 20th MG Lind Div Fidelity PFF Vanguard WB Fidelity MCA Fidelity BC Gabelli Value Fund Putnam Voyager Aggressive Growth Fidelity Growth & Income Fund Fidelity Contrarian Fund 20th Century Momentum Growth Fund Lindner Dividend Income Fund Fidelity Puritan Flexible Fund Vanguard Wellington Balanced Fund Fidelity Magellan Capital Appreciation Fund Fidelity Blue Chip Growth Fund Market Indices: Dow Jones S & P 500 L.B. Bond Index Dow Jones 30 Industrials S & P 500 Lehman Brothers ADS/S/ Admin/Ratcliff /DefComp.lst 1 500 Wellington Wellesley Windsor II September 25, 1996 Page 10 of 28 CCCSD Ddferred Camp :Jistributian By Administrator (Calendar Year 1995) leMA $5,320,835 (190/0) Gr. Western ~ $9,116,726 (34%) Hartford $1 2,906,342 (470/0) Total Investments: $27,343,903 (Six Months Ended June 30, 1996) leMA $7,217,438 (250/0) Hartford $12,318,498 (420/0 ) Total Investments: $29,302,441 Gr. Western $9,766,505 (330/0 ) Page 11 of 28 ^.- CCCSD Deferred Camp Jistributian By Investment Type (Calendar Year 1995) Stocks $11,688,753 (430/0) Savings $14,860,888 (54%) Bonds $794,262 (30/0 ) Total Investments: $27,343,903 (Six Months Ended June 30, 1996) Stocks $13,816,708 (470/0) Bonds $14,649,832 Savings (500/0 ) $835,901 (3%) Total Investments: $29,302,441 Page 12 of 28 Q) () c ct1 E '- o '+- '- Q) c... en O>iO cm -- m >~ CO"- CJ)m Q) 0.>- Ern 0-0 Oa5 - -om 0)2, '- '- Q) '+- Q) o o CJ) o o o .........................-.....................................................................-..-.................-..............-........ ......-........................-..................-.........-.......................-..............................................-............. ........._onu......._.......nn.............._.............____...........___....nnn__n.nn.____...........__n_.......... ............__nn_..........................nun.......nu..nn_n.nn..nn.._n..................n...____n............ co .,- (0 .,- v .,- C\I .,- ...-... 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(t) LO (t) ....-... CD 0) LO 0) ....--.--............--................................ C\J ,.... a ~ <( "'0 LL u... "- co "'0 co 0 () '+- C -e - . <( "'0 ~ (tj I ~ c . 0 C) () co . co .-I ....-... ... (fi. 0 '-"'(W') Q) c: :J ~ .. -e Q) -e.. c: W en ..c ...... c: o ~ >< -- Cf) '-'" ac C\J"- :J ......, 0) a: LOO 'r"0) ro a: a 'r" .. LO x 0) "'0 C - "'0 C o co . CD .-I .,- .. a .. 'r" I ....-... >R- .. C\J ~ I C "- :J of-' (t)0) ........................---...................---.--- I a: '+- o 0) .......m.........m............................... ~ 1a a: .......m..m....___................___............ LO I .....n.............................................. (0 I ....... I <( "'0 LL u.. "- CD 0 co 'E () . <( ~ (tj I ~ . CJ () Page 19 of 28 ~ "'0 C of-' 0) ~ "- CO ~ ATTACHMENT I CENTRAL CONTRA COSTA SANITARY DISTRICT DEFERRED COMPENSATION PLAN (As amended and restated effective January 1, 1989) SECTION 1. Name. The name of this Plan is the Central Contra Costa Sanitary District Deferred Compensation Plan (the "Plan") which is hereby adopted as amended and restated effective January 1, 1989. The Plan was amended and restated in its entirety to comply with the Internal Revenue Code of 1986, as amended, and to make certain other clarifying and conforming changes. SECTION 2. Pur:pose. The primary purpose of the Plan is to attract and retain personnel by permitting them to enter into agreements with the Central Contra Costa Sanitary District which will provide for deferral of payment of a portion of their annual compensation until 4eath, retirement, termination of employment or other event, as provided herein, in accordance with the provisions of Sections 53212-53214 of the _ Government Code of the State of California and Section 457 and other applicable sections of the Internal Revenue Code of 1986. SECTION 3. Definitions. For purposes of this Plan, the following words and phrases when used and capitalized herein shall have the following meanings: 3.1 "Code" shall mean the Internal Revenue Code of 1986 as amended. 3.2 "Compensation" shall mean the total of all amounts which would be paid by the Employer to or for the benefit of an Employee (if he or she were not a Participant in the Plan) for serviCC?s performed by the Employee during the period of time he or she is a Participant. 3.3 "Deferred Compensation" shall mean that portion of an Employee's Compensation which the Employee has elected to defer in accordance-with the provisions of the Plan, subject to the following limitations: (a) The maximum amount that may be deferred under the Plan for the taxable year ofa Participant shall not exceed the lesser of (1) $7,500, or (2) 33 1/3 percent of the Participant's Includible Compensation. (b) Subject to the provisions of Section 3.3( c) , for one or more of a Participant's last three taxable years ending prior to a Participant's retirement, the maximum amount that may be deferred under the Plan shall be the lesser of (1) $15,000 or, (2) the sum of the limitation in 3.3(a) above and so much of the limitation which has not been utilized since January 1, 1979. #4052 Page 20 of 28 -------------, ----------------- ------------------------- ------------- #4052 (c) In applying the limitation of $7,500 of Section 3.3(a) and the limitations of3.3(b) for a Participant during the Participant's taxable year, the following shall be treated as amounts deferred: (I) Amounts deferred during such taxable year under any other plan described in Code Section 457(b); (2) Amounts excluded from gross income during such taxable year under a tax-sheltered annuity program described in Code Section 403 (b); (3) Amounts excluded from gross income during such taxable year pursuant to a qualified cash or deferred arrangement described in Code Section 401(k) or a simplified employee pension described in Code Section 408(h), except for amounts excluded under a rural co-operative plan as defined in Code Section 401(k)(7); (4) Amounts with respect to which a deduction is allowable for such taxable year by reason of a contribution described in _ Section 501(c)(18) of the Code. 3.4 "Employee" shall mean regular full-time employees who perform services for the Employer and regular part-time holding limited positions for a full Employment Year employees who perform services for the Employer. 3.5 "Employment Year" shall mean the calendar year, except that the first year of an Employee hired in mid-year shall be a short year beginiling with the date of employment and ending on the date the employment year otherwise ends. 3.6 "Employer" shall mean the Central Contra Costa Sanitary District. 3.7 "Includible Compensation" shall mean the remuneration for services performed for the Employer which, after taking into account the applicable provisions of the Code, is currently includible in gross income for Fede,ral tax purposes for the Participant's Employment Year. 3.8 "Participant" shall mean an Employee who has elected to participate in the Plan. 3.9 "Participation Agreement" shall mean the agreement executed and filed by an Employee with the Employer pursuant to Section 4 of the Plan, in which the Employee elects to become a Participant in the Plan. 3.10 "Required Beginning Date" shall mean April 1 of the calendar year following the calendar year (1) in which the Participant attains age 70 Y2 or (ii) the Participant retires, whichever is later. Page 21 of 28 -----.-.-----r .-..--.--...-----.-.---..-----.--.----.---......------- ....-.-----.. #4052 SECTION 4 Participation in the Plan 4.1 Enrollment Periods for Voluntary Contributions. ( a) When the Plan is first made available, an Employee shall have thirty (30) days from the date voluntary participation in the Plan is offered to him or her to effect an election to participate. Such election shall be effective in the first month after the date on which his or her Participation Agreement is filed with the Employer. (b) Any person who becomes an Employee after this Plan is first made available on a voluntary basis shall have the option, within thirty (30) days after becoming an Employee to effect an initial election to participate under this Plan in the first month after the date on which his or her Participation Agreement is filed with the Employer. - (c) Any Employee who does not file an initial election, pursuant to (a) or (b) above, shall have the right to elect participation during monthly enrollments. Such election shall be for pay periods in the first month after the date on which his or her Participation Agreement is filed with the Employer. . 4.2 Enrollment Periods for Mandatory Contributions. (a) At the time ofthe Participation Agreement hereunder, a Participant must agree to defer a minimum of$5.00 per month of Compensation in order to be eligible for the Employer's contributions as set forth in Section 4.2(b). (b) The Employer shall contribute to the Plan an amount on behalf of each Participant equal to the percentage of the Participant's monthly salary which would have otherwise been paid to the Social Security Plan, as said percentage may be changed from time to time. SECTION 5. Deferral of Compensation. During each Employment Year in which the Employee is a Participant in the Plan, the Employer shall not pay the Employee his or her full Compensation but shall defer payment of such part of his or her Compensation as is specified by the Employee in the Participation Agreement which he or she has executed and filed with the Employer and subject to the limits set forth in Section 3.3 herein. Compensation shall be deferred in equal amounts over each pay period of the Employee's Employment Year. Page 22 of 28 -1- ._-~--_._._."_._--^~.~.._^_....._. #4052 SECTION 6. Administration of the~ Plan. 6.1 The Plan shall be administered by the Employer, who shall have the sole authority to enforce the Plan and shall be responsible for the operation of the Plan in accordance with its terms. The Employer shall determine the time, manner, the amount of payments of benefits pursuant to Section 7 and shall determine all questions arising out of the administration, interpretation and application of the Plan, which determination shall be conclusive and binding on all persons. 6.2 The Employer shall establish a Deferred Compensation fund to which all Deferred Compensation will be credited at such times as the Compensation would have been payable to an individual Employee if not a Participant of the Plan. Separate book accounts will be established for each EmployeelParticipant which will show all amounts of Deferred Compensation, investments made, shares acquired, and earnings and gains on investments. Each book account will be valued at least annually. 6.3 On executing the Participation Agreement, the Employee shall designate his or her investment objective. The Employer may, but is not required to, invest amounts of Deferred Compensation in the investment vehicles provided for in the Plan which in the Employer's sole judgment will best achieve the Employee's investment objective. 6.4 All amounts of Deferred Compensation, all property and rights purchased with such amounts, and all income attributable thereto, whether or not invested by the Employer shall remain, until made available to a Participant or Beneficiary, solely the property and rights of the Employer, subject only to the claims of the Employer's general creditors. : 6.5 Neither this Plan nor any Participation Agreement nor any book account shall be d~med to create a trust or custodial account on behalf of or for the benefit of any Participant of the Plan or his or her beneficiaries. No Participant of the Plan or his or her beneficiaries shall have, by reason of the Plan, Participation Agreement, or book account, any secured or preferred interest in or to any assets of the Employer. The Employer shall have only a contractual obligation to pay the benefits due the Participant under the Plan. SECTION 7. Distribution of Benefits 7.1 Commencement of Distribution. (a) Except as provided in Section 7.4, distributions under the Plan shall commence no earlier than (i) when the Participant is separated from Page 23 of 28 I'..---,.------.--".----...---~--^- . ----.-.- #4052 service (within the meaniilg of Section 457(d)(1)(A)(ii) of the Code) or (ii) if the Participant so elects, the calendar year in which the Participant attains age 70~, and no later than the Participant's Required Beginning Date. A Participant shall, within sixty (60) days after the earlier of the date on which the Participant separates from service with the Employer or the Participant's attainment of age 70%, elect a form of distribution permitted under Section 7.2 and a time of commencement of his or her distribution from the Plan which time shall be no later than his or her Required Beginning Date. (b) Effective January 1, 1997, except as provided in Section 7.4, distributions under the Plan shall commence no earlier than when the Participant is separated from service (within the meaning of Section 457 (d)(I)(A)(ii) of the Code); and shall commence no later than the Participant's Required Beginning Date. Prior to separation from service, the Participant may elect the date upon which distribution of benefits will commence. Subsequent to separation from service, and prior to the date distribution of benefits would otherwise commence under this Section, the Participant will have a one-time irrevocable election to determine the date upon which distribution of benefits will commence, or if the Participant previously elected such date, to change the date, upon which the distribution of benefits will commence. 7.2 Form and Duration of Distribution of Benefits. (a) Commencing with the date determined pursuant to Section 7.1, the full amount credited to a Participant's book account plus or minus subsequent investment gains or losses, but less any Federal or State Income Taxes required to be withheld, shall be distributed subject to Section 7.2(b), to the Participant in anyone or more of the following fonns; provided, however that if the Participant has made no election of a fonn of distribution as of the date the distribution is to be made under Section 7.1, distribution shall be made in the fonn described in Section 7.2(a), Option 1: Option 1. Lump sum payment. The total benefits payable in one cash payment. Option 2. Payments for a specified period. Amounts payable in equal installments over a period of three (3) to thirty (30) years, subject to the limitations set forth in Section 7.2(b). If the Participant has elected a payment option requiring installment payments, the Participant may also elect to have such payments made either monthly, quarterly, semi-annually or annually. Page 24 of 28 T ------------------- ---------------.-------- #4052 Option 3. Life annuity. An annuity payable during the lifetime of the Participant or his or her Beneficiary if this option is selected. Option 4. Life annuity with period certain guaranteed. An annuity payable during the lifetime of the Participant, or his or her Beneficiary, if this option is selected, with the guarantee that if at his or her death payments have not been made for the guaranteed period as elected, payments will continue to the Beneficiary. The guaranteed period to be elected must be either ten (10), fifteen (15) or twenty (20) years. Option 5. Joint and survivor annuity. An annuity payment during the lifetime of the Participant and a secondary payee named by the Participant. (b) Payments made pursuant to Section 7.2(a), Option 2 shall be made over a period certain not to exceed the life or life expectancy of the Participant or the joint life or life expectancy of the Participant and his or her designated Beneficiary and at times specified by the Secretary of Treasury which are not later than the times determined under Section 401(a)(9)(G) of the Code. 7.3. Death. (a) In event of death of any Participant, either before or after separation from service, the full amount credited to his or her book account, less any Federal or State Withholding Taxes required by law, shall be distributed to his or her Beneficiaries in the manner designated in the Participant's Participation Agreement. If the Participant has made no election of the time or form of distribution as to a Beneficiary, such Beneficiary shall designate the time and manner of distribution to himself or herself. Choices of the form of distribution of benefits shall be as provided in Section 7.2, provided, however, that if payments begin before the death of the Participant, the manner of distribution to the Beneficiary must be at least as rapid as the method of distribution being used as of the date of the Participant's death; provided further, that if distributions do not begin before the death of the Participant, then the Participant's book account shall be paid to the Participant's Beneficiary by December 31 of the calendar year which contains the fifth anniversary of the Participant's death, or if the designated Beneficiary so elects, over a period not to exceed the lesser of 15 years or the life or life expectancy of such Beneficiary beginning no later than December 31 of the calendar year immediately following the calendar year in which the Participant dies; provided further, that if the designated Beneficiary is the Participant's spouse, Page 25 of 28 [....---.----.-.--------------.- --~._-.~,..-~..._._...___...~,____._.".._._._.,_.,._~.','_ ___..,.._._.__.____~__.__~._m._'__.__.,.___.'__.__..__..__,__._...._._..,____,._"'.~.._._".._,,_,,___._,.....__ distributions may be made over a period not to exceed the remaining life expectancy of the spouse. (b) If neither the Participant nor the Beneficiary has made an election of the time or form of distribution, payment to the Beneficiary shall be made in a lump sum sixty (60) days after the later of the date of the Participant's death or the date on which the Participant's Beneficiary is identified pursuant to Section 11.4. 7.4 Unforeseeable Emergency. In the event of an unforeseeable emergency affecting a Participant, the Participant may apply to the Employer for a withdrawal from the Plan. "Unforeseeable emergency" means a severe rmancial hardship to the Participant resulting from a sudden and unexpected illness or accident of the Participant or of a dependent (as defined in Section 152(a) of the Code) of the Participant, loss of the Participant's property due to casualty, or other similar extraordinary and unforeseeable circumstances arising as a result of events beyond the control of the Participant. The circumstances that constitute an unforeseeable emergency depend upon the facts of each case, but in any case, the withdrawal shall be limited to that sum necessary to alleviate the hardship to the Participant, shall be in a lump sum, and shall not be the cause of any other distribution of benefits to the Participant. SECTION 8. Employer Participation. Notwithstanding any other provision of this Plan, the Employer may make additional deposits in the Deferred Compensation fund as additional compensation for the services rendered by the Employee to the Employer during an employment year. SECTION 9. Nonassignability. Subject to Section 10, to the fullest extent permitted by law, the interest of a Participant in the contractual obligation of the Employer, established by the Plan, shall not be assignable in whole or in part,_ directly or by operation of law or otherwise, in any manner, and no right or interest of a Participant in the Employer's contractual obligation shall be liable for or subject to any obligation or liability of such Participant. SECTION 10. Facility of Payment. If any Participant terminates his or her employment with an unpaid debt owing to the Employer, and neglects or refuses to liquidate the debt by any other means when due and upon demand, the Employer shall be entitled to collect the amounts due from the Deferred Compensation owed to the Participant under the Plan. SECTION 11 - Miscellaneous. 11.1 Limits. Neither the establishment of the Plan nor any modification thereof, nor the establishment of any book account, nor the payment of any benefits, shall be construed as giving to any Participant or other person any #4052 Page 26 of 28 I ------------------------.------.-. #4052 legal or equitable right against the Employer except as herein provided; and, in any event, shall the terms of employment of any Employee or Participant be modified or in any way be affected hereby. 11.2 Condition of Plan. It is a condition of this Plan, and each Employee by participating herein expressly agrees, that he or she shall look solely to the general assets of the Employer for the payment of any benefit to which he or she is entitled under the Plan. 11.3 Governing law. This Plan shall be construed, administered, and enforced according to the laws of the State of California. 11.4 Designation of Beneficiaries. Each Participant shall have the right, on a form provided by the Employer, to designate beneficiaries to receive any benefit to which said Participant may be entitled in the event of his or her death prior to the complete distribution of benefits. Such designation shall become effective when received by the Employer and must be received prior to the Participant's death. If no such designation is in effect on a Participant's death, his or her Beneficiary shall be his or her estate or if no executor or administrator is appointed within six (6) months after the . Participant's death, the Employer shall direct said benefits to be paid in the following order: spouse of the Participant, lineal descendants, lineal ancestors, blood relatives. SECTION 12: - Amendment and Termination. 12.1. The Employer may at any time and from time to time modify, amend, or terminate the Plan in whole or in part (including retroactive amendments) or cease deferring compensation pursuant to the Plan, by delivering to each Participant a written copy of such modification, amendment, or tennination or of a notice that it ceases deferring compensation; provided, however, the Employer shall not have the right to reduce or affect the value of any Participant's book account or any rights accrued under the Plan prior to such modification, amendment, termination, or cessation. 12.2. In the event of the termination of the Plan by the Employer under Section 12.1, the value of each Participant's book account shall be distributed to the Participant. The amount, method, and time of payment shall be determined as provided in Section 7. . Page 27 of 28 -r'.---...._-~_.._-----_._._..__.._,. ,_..,.~_"._"._,___.^__.-<_.M....,._.__.____.__._,_,...._-'.---.--.---- . -... -,-.----."..-,....-. RESOLUTION NO. A RESOLUTION AMENDING AND REVISING THE DEFERRED COMPENSATION PLAN WHEREAS, amendments have been proposed to the Central Contra Costa Sanitary District's Deferred Compensation Plan to ensure compliance with Internal Revenue Code Section 457 and to incorporate other appropriate revisions; and WHEREAS, such amendments and revisions have been reviewed and approved by outside benefit Counsel and the CCCSD's Deferred Compensation Plan Advisory Committee; NOW, THEREFORE, be it resolved, that those amendments and revisions as incorporated in the attached copy of the amended Deferred Compensation Plan (10/17/96) be approved. PASSED AND ADOPTED by the District Board of the Central Contra Costa Sanitary District this 17 day of October, 1996, by the following vote: AYES: NOES: ABSENT: Members: Members: Members: President of the District Board of the Central Contra Costa Sanitary District, County of Contra Costa, State of California COUNTERSIGNED: Secretary of the District Board of the Central Contra Costa Sanitary District, County of Contra Costa, State of California APPROVED AS TO FORM: Kenton L. Aim District Counsel S:\ADMIN\RA TCLlFF\DEFCOMP\AMENDPlN.RES Page 28 of 28 . T..-.--.---------------------.....---.-..... ~ BOARD OF DIRECTORS ... ........... .... . ,. ...................... ....... ......... ,:::::1111111_1:::'::1_1'111:::::::::::::: BOARD MErnO~70ber 17, 1996 ~1~t::~r~t~::::;:;::::~~~::::;:;::::~::::ji:i~~~::)j::::;:;::::~b::~}:::::~;r::::}~m::::~r~~::::::::m~m;;:::::;i:;i::l~t:)Ijjjrj. Central Contra Costa Sanitary District Page 1 of 8 NO. 11. BUDGET AND FINANCE b. October 11, 1 996 TYPE OF ACTION RECEIVE AUDITED FINANCIAL STATEMENTS DATE SUBJ ECT RECEIVE THE AUDITED FINANCIAL STATEMENTS AND MANAGEMENT LETTER FOR THE FISCAL YEAR ENDED JUNE 30, 1996. SUBMITTED BY Debbie Ratcliff, Controller INITIATING DEPT/DIV Administrative/Finance and Accounting ISSUE: The audited financial statements and Management Letter of the Central Contra Costa Sanitary District for the fiscal year ended June 30, 1996 are being submitted to the Board of Directors. BACKGROUND: The firm of Hood and Strong, Certified Public Accountants, has completed its examination of the District's financial statements for the fiscal year ended June 30, 1996, and has submitted the audited financial statements and auditor's opinion thereon. In the routine performance of their examination of the financial statements, the auditors evaluate the District's internal accounting controls to determine the nature and extent of the auditing procedures required. Based on their observations during the course of the examination, the auditors routinely advise District management of any recommendations to improve the system of internal accounting controls. The Management Letter is provided as Attachment I. Staff accepts the auditor's recommendations and will implement them over the next fiscal year. A brief staff presentation will outline the District's response to the recommendations. The audited financial statements and Management Letter were previously submitted in draft form to the Board's Budget and Finance Committee for review, as well as to the State Controller's Office by the annual deadline. A copy of the audited financial statements has been received by the Board under separate cover. RECOMMENDATION: Receive the audited financial statements and Management Letter for the fiscal year ended June 30, 1996. REVIEWED AND RECOMNIENDED FOR BOARD ACTION DR PM INtnA TlNG DEPARTMENT /DIVISION ",' II I/;:~ S :\ADMIN\POSP APER\AUDFIN .PP 9/16/96 ATTACHMENT I Page 2 of 8 pages CENTRAL CONTRA COSTA SANITARY DISTRICT REpORT TO MANAGEMENT JUNE 30, 1996 Page 3 of 8 pages HOOD&! STRQNG LLP CERTIFIED PUBLIC ACCOUNTANTS August 23, 1996 THE BOARD OF DIRECTORS CENTRAL CONTRA COSTA SANITARY DISTRICT Martinez, California In planning and performing our audit of the financial statements of CENTRAL CONTRA COSTA SANITARY DISTRICT (the District) for the year ended June 30, 1996, we considered the District's internal control structure in order to determine our auditing procedures. Although our audit was not designed to provide assurance on the internal control structure, we noted certain matters involving the internal control structure and its operation, and are submitting for your consideration related recommendations designed to help the District make improvements and achieve operational efficiencies. Additionally, we have included a statement on communications with the Finance Committee as required by professional auditing standards. The accompanying comments and recommendations do not affect our report dated August 23, 1996 on the financial statements of the District and are intended for the information and use of the management of the District, the Finance Committee, the Board of Directors, and others within the organization. H~<>~HfJ Consultants and Business Advisors 101 Califor/1ia Suitt 1500 Sail FrallC;SiO CA 9n // 4/5. ~81.0793 fax 415.421.29~r, San Francisco M",zo Park Page 4 of 8 pages CENTRAL CONTRA COSTA SANITARY DISTRICT 1996 REPORT TO MANAGEMENT ... CONTENTS Section I Required CO!'lmunications 1 - 2 Section II Comments and Recommendations 3-4 Page 5 of 8 pages CENTRAL CONTRA COSTA SANITARY DISTRICT 1996 REPORT TO MANAGEMENT ~ I. REQUIRED COMMUNICATIONS Professional auditing standards require auditors to communicate with the Finance Committee on a number of subjects. The following information satisfies these requirements, and is intended for use ofthe Finance Committee, Board of Directors and management. 1. The Auditor's Responsibility Under Generally Accepted Auditing Standards An audit performed in accordance with generally accepted auditing standards is intended to provide reasonable assurance that the financial statements are free of material misstatement. The following characteristics of an audit are important to understanding the level of the auditors' responsibility and the difference between reasonable assurance and a guarantee or absolute assurance as it pertains to the balance sheet. . For reasons of economy, an audit does not include the examination of 100% of the information supporting or presented in financial statements. As a result, judgment is required in deciding what kind and how much evidence is to be examined in determining the fairness of the financial presentation. . The financial statements necessarily require certain estimates of management (e.g., the amount of uncollectible receivables). An audit includes procedures designed to review and test the reasonableness of these estimates in relation to the financial statements as a whole. However, estimates are, by their nature, inherently imprecise and an audit cannot be relied upon to provide assurance that estimates (individually or in the aggregate) are completely accurate or precise. . An audit is planned and performed with an attitude of professional skepticism, the objective of which is to provide reasonable assurance of detecting significant errors or irregularities. An auditor, however, is not trained to detect forgeries. Irregularities or frauds that are concealed through forgery or collusion (among client personnel and/or outsiders) may not be detected or detected only by chance. An audit is intended to provide reasonable assurance that financial statements are free of material misstatements. For the reasons described above, an audit cannot be relied upon as a guarantee or to provide absolute assurance that the financial statements are free of all material misstatements. 2. Significant Accounting Policies and Unusual Transactions The accounting policies adopted by. the District are those used to prepare the financial statements and are disclosed in the footnotes to those statements. During the year ended June 30, 1996, there were no significant changes in accounting policies or unusual transactions. Page 6 of 8 pages CENTRAL CONTRA COSTA SANITARY DISTRICT 1996 REPORT...TO MANAGEMENT (CONTINUED) I. REQUIRED COMMUNICATIONS (Continued) 3. Management Judgments and Accounting Estimates The amount of uncollectible receivables requires an estimate on the part of management. This estimate is based on known information and communication between management and the debtors. The amount of receivables recorded in the financial statements reflects the portion which management believes to be collectible. The calculation of depreciation expense also requires estimates. The useful life of an asset, initial date of service and depreciation method are estimates made by management in order to derive depreciation expense for fixed assets individually. 4. Significant Audit Adjustments As a result of the audit process, adjustments to the financial statements were made to record costs incurred for sewer relocation for the California Dept. of Transportation as expenditures. The costs had initially been recorded as additions to construction-in- progress. 5. Disagreements with Management There were no disagreements with management concerning accounting matters during the course of our audit. 2 Page 7 of 8 pages CENTRAL CONTRA COSTA SANITARY DISTRICT 1996 REPORT TO MANAGEMENT (CONTINUED) II. COMMENTS AND RECOMMENDATIONS 1. Reserve Fund Investments Comment The District is required to maintain a minimum balance in a trusteed reserve account as a result of the 1994 Revenue Installment Certificates debt covenants. The District has established the reserve account on their general ledger and was recording activity on a regular basis. During our review of the balance in the reserve fund at June 30, 1996, we noted that there had been no formal comparison of the reserve account balance in the Trustee's statement to the debt requirements. Recommendation As with all debt covenants, it is important that the District establish procedure to assure compliance with the covenants. We recommend that the District review the balance in the reserve account on a semi-annual basis to ensure the minimum balance required is maintained as defined in the debt covenants. 2. Administrative Overhead Comment The District maintains a capital project cost system which records the detail of all capital disbursements by project. The District is capitalizing to projects internal labor, benefits, and administrative overhead as well as construction and purchasing expenditures. The overhead rate is a percentage applied to labor dollars charged to the projects. The overhead rate currently being used was established by a consultant in a costing study approximately 10 years ago. Recommendation Although the rate used for the application of overhead appears conservative, we recommend that the District consider an analysis of its actual overhead rates. In addition, a policy should be developed to document the method of the calculation and frequency with which it should be updated. The District could choose from a wide range of calculation and costing methods but should strive to select a method which can be established by the District and easily replicated. 3 Page 8 of 8 pages CENTRAL CONTRA COSTA SANITARY DISTRICT 1996 REPORT TO MANAGEMENT (CONTINUED) D. COMMENTS AND RECOMMENDATIONS (Continued) 3. Information Systems Comment The District is presently following a strategic plan developed by the Warner Group. The time period covered by this plan is nearing expiration. We understand the District's staff is currently developing another long term strategic plan. Recommendation We recommend the District formalize its development plans including a tinie frame for the completion of the strategic plan. 4. Environmental Liabilities Comment Environmental liabilities and remediation costs are the subject of an accounting standard soon to be released. Environmental clean-up can be a significant financial commitment and has therefore been the topic of discussion for many for-profit entities as well as governmental entities. Currently the District's accounting and reporting system does not distinguish environmental clean-up or testing projects from capital projects. Recommendation We recommend the District establish a means of identifying environmental projects and communicating the information to accounting personnel. Information will need to be communicated at the point where the situation is first discovered or in the planning phase of a project. Accounting will need. to evaluate each situation to determine if costs incurred can be capitalized or should be expensed and the necessity of an accrued liability for future expenditures. 4 _ ..__.___..____---,- ..___.____".".."'....~~__"...____________._..~.'""~__._.____.~__.,__o_.___._