The URL can be used to link to this page

Home My WebLink AboutAGENDA BACKUP 05-07-92 ~ C8ntral Contra Costa Sanitary District ~ BOARD OF DIRECTORS ,...-...-...._....-.:...-_................................................'...............'.........'.................-........ PQBllllleABBa BOARD MEETI::F 7, 1992 SUBJECT PAGE 1 OF 1 NO. 4. CONSENT CALENDAR a. DATE Ma 4 1992 TYPE OF ACTION ADVISE THE BOARD OF THE CLOSE OUT OF THE PLEASANT HILL INTERCEPTOR/A-LINE FACILITIES PLAN AND EIR PROJECT (DP 4271) SUBMITTED BY James R. Coe, Associate Engineer INFORMA TIONAL INITIATING DEPTJDIV. Engineering Department/Planning Division ISSUE: All work has been completed on the Pleasant Hill Interceptor/A-Line Facilities Plan and EIR project (DP 4271), and the project account is being closed out. BACKGROUND: The Pleasant Hill Interceptor/A-Line Facilities Plan and EIR Project was initiated in October of 1986 in response to wet-weather capacity problems in the existing Contra Costa (CCl Boulevard and A-Line Interceptors identified in the 1986 Collection System Master Plan. The importance of wet-weather capacity was emphasized when the CC Boulevard Interceptor overflowed at Baylor Lane during the February 1986 storm event. The District utilized the services of John Carollo Engineers; Camp, Dresser & McKee Engineers; Environmental Science Associates; James Montgomery Engineers; Woodward-Clyde Consultants; CH2M Hill Engineers; and Urban Alternatives as consultants to assist staff in completing the work required up to the point of EIR certification and approval of the project. A total budget of $1,374,200 was established to complete the following tasks: o Facilities Plan Report o Television Inspection o Survey/Mapping o Right-of-Way/Property Acquisition Investigation o Flow Monitoring o Hydraulics Modeling/Design Flows o Flood Control Coordination o Route Selection o Headworks Project Design Coordination o Geotechnical Report o Environmental Impact Report o Community Meetings/Public Participation o Utilities Coordination o Caltrans Coordination o Predesign Support All tasks have been completed, and the Final EIR has been certified. The project was completed for $1,373,614 allowing $586 to be returned to the Collection System Program. The 1992 Capital Improvement Plan includes over $74 million for design and construction of Pleasant Hill and A-Line Relief Interceptors. Design of the Pleasant Hill Relief Interceptor is underway with construction scheduled to begin July 1993. RECOMMENDATION: This item is presented to the Board of Directors for information only. No action is necessary. INITIATING DEPTJDIV. RE~EWEDANDRECOMMENDEDFORBOARDAcnON jJ4J JRC JMM MfJ DRW RAS -......-----,-. PAGE 1 OF 2 BOARD MEETING OF May 7, 1992 NO. 4. CONSENT CALENDAR b. SUBJECT DATE ACCEPT THE CONTRACT WORK FOR THE MT. DIABLO SIPHON SLlPLlNING PROJECT, WALNUT CREEK (DP 4535B) AND AUTHORIZE THE FILING OF THE NOTICE OF COMPLETION May 1, 1992 TYPE OF ACTION ACCEPT CONTRACT WORK SUBMITTED BY Ronald S. Klimczak Senior En ineer INITIATING DEPT./DIV. Engineering Department Plant En ineerin Division ISSUE: Construction has been completed on the Mt. Diablo Siphon Sliplining Project in Walnut Creek (DP 4535B), and the work is now ready for acceptance. BACKGROUND: In order to realize the benefits of initiating year-round operation of the recently completed Walnut Creek Downtown Bypass Interceptor (Bypass), it was necessary to reduce the size of one of the two 42-inch siphon barrels at Mt. Diablo Boulevard to create an adequate cleansing velocity during periods of low flow. The work accomplished under this project involved installing approximately 400 linear feet of 24-inch diameter liner pipe in the east barrel of the siphon at Mt. Diablo Boulevard. The project location is shown on Attachment 1. The Board of Directors awarded a construction contract in the amount of $58,400 to D'Arcy & Harty Construction, Inc., of San Francisco, on February 6, 1992. The contractor was issued a Notice to Proceed on March 16, 1992. The specified contract completion date was July 13, 1992. The diligent efforts of the contractor with the timely cooperation of District staff completed all work on April 18, 1992, approximately two and one-half months early. It is appropriate to accept the contract work at this time. The Board authorized a contingency allocation of $152,000 to fund the project cost. A detailed accounting of the project costs will be provided to the Board at the time of project closeout. RECOMMENDATION: Accept the contract work for the construction of the Mt. Diablo Siphon Sliplining Project in Walnut Creek (DP 4535B), and authorize the filing of the Notice of Completion. REVIEWED AND RECOMMENDED FOR BOARD ACTION INll;~/tDBT./DIV. !)HJ 1302A-7/91 RSK WEB RAB --.----.------------.-.--.----r-....-..-....-----.-.---....--- APARTMENT COMPlEX i . J-Z- SFHON N.ET BOX PLAN .1 . central Contra Costa Sanitary Disfric( MT. DIABLO SIPHON SLIPUNING PROJECT DP 45358 Vicinity Map and Site Plan Attachment 1 PAGE 1 OF 1 NO. 4. CONSENT CALENDAR c. SET MAY 21, 1992, AT 3 P.M. AS THE DATE AND TIME FOR A PUBLIC HEARING PRIOR TO CONSIDERING APPROVAL OF A NEGATIVE DECLARATION AND THE COLLECTION SYSTEM OPERATIONS (CSO) YARD RENOVATION PROJECT DATE Ma 4, 1992 TYPE OF ACTION SET PUBLIC HEARING DATE SUBMITTED BY INITIATING DEPT JDIV. Russell B. Leavitt, Planning Assistant Engineering Dept.lPlanning Division ISSUE: District practice is to hold a public hearing prior to the Board considering approval of a Negative Declaration and project. BACKGROUND: At its May 21, 1992 meeting, the Board will be requested to approve a Negative Declaration prior to approving the CSO Yard Renovation Project. The District proposes to reconfigure portions of its CSO corporation yard to relocate some uses due to the pending loss of approximately one acre of land to Caltrans' 1-680/SR 24 interchange improvement project. The CSO corporation yard includes offices, material and equipment storage, and maintenance facilities. The proposed actions include relocating vehicle parking, materials storage, and vehicle maintenance facilities, rerouting traffic flow within the yard, removing of buildings affected by the Caltrans right-of-way acquisition, constructing replacement buildings, retaining walls, and improvements to existing buildings, and grading, paving, and landscaping. To remedy inconsistencies between the existing land use and planned land use categories, this project includes requests for a City of Walnut Creek General Plan amendment and Conditional Use Permit. The project proposes to amend the General Plan land use designation for the eastern portion of the site from "OF" (Office) to "PU" (Public Utility) to provide a land use designation consistent with the historical function of the site as a corporation yard and maintenance facility. The western portion of the site, generally fronting on Springbrook Road, would remain in the current "Office" designation. The District also seeks a Conditional Use Permit so that the existing office and storage and maintenance uses conform with the existing "C-G" (General Commercial) zoning district. While not required by law or the District's procedures, it has been the District's practice to hold public hearings in advance of the adoption of Negative Declarations on major projects. RECOMMENDATION: Set May 21,1992,3 p.m., as the date and time to receive public comment on the Negative Declaration for the CSO Yard Renovation Project. REVIEWED AND RECOMMENDED FOR BOARD ACTION tGL z,; IJ~ J1JF RBL JMM DRW RAB INITIATING DEPT.lDIV. 1302A-7/91 ------------.-----,--- Central Contra Costa Sanitary District BOARD OF DIRECTORS PAGE OF 1 BOARD MEETING OF May 7, 1992 NO. 4. CONSENT CALENDAR d. SUBJECT DATE AUTHORIZE THE ATTENDANCE OF BONNIE ALLEN, RISK MANAGER, AT THE JUNE 14-19 MEETING OF THE NATIONAL SAFETY COUNCIL EXECUTIVE COMMITTEE-PUBLIC UTILITIES SECTION IN HERSHEY, PENNSYLVANIA, AT A COST OF $1,450 2 TYPE OF ACTION AUTHORIZE TRAVEL SUBMITTED BY INITIATING DEPT./DIV. Bonnie Allen, Risk Manager Administrative/Risk Management ISSUE: Approval by the Board of Directors is required for unbudgeted travel outside of California and/or where the expense will exceed $500. BACKGROUND: Bonnie Allen, Risk Manager, is a member of the Executive Committee of the National Safety Council. Recognized safety and health professionals are selected for membership on this national committee which includes Risk Managers, Safety Directors and Managers of both private corporations and of public agencies and utilities. Ms. Allen was appointed chair of the subcommittee responsible for technical publications. The committee meets three times each year for training, project workshops and professional development. Sessions include: reviewing and providing input to legislators on new or proposed changes to safety and environmental health laws; exchanging accident/injury preventions strategies; sharing innovative approaches to train and motivate employees; evaluating training materials (including films/videos, manuals and procedures); developing data and safety and health information. The subjects cove~d and the materials developed are available for use by member organizations including Central San. These topics are relevant to the Districts' risk management and safety programs and the resources afforded through interaction with committee members are of added benefit to the District. There are funds available for this meeting in the 1991-92 budget for Risk Management and Safety in the Technical Training and conference Account though the specific dates and location of the meeting were not known when the budget was developed. RECOMMENDATION: Authorize the attendance of Bonnie Allen, Risk Manager, at the meeting of the National Safety Council Executive Committee-Public Utilities Section June 14-19, 1992, in Hershey, Pennsylvania, at a cost of $1,450. REVIEWED AND RECOMMENDED FOR BOARD ACTION BA PM ~ INITlATI,NG DEPT./DIV. 1302A-7/91 .--------------,------------..----....-....... Central Contra Costa Sanitary District BOARD OF DIRECTORS PAGE 1 OF 15 BOARD MEETING OF May 7, 1992 NO. 6. SOLID WASTE a. DATE April 29, 1992 SUBJECT CONSIDER ISSUES RAISED BY VALLEY WASTE MANAGEMENT IN CONNECTION WITH THE FULL-SCALE IMPLEMENTATION OF THE RESIDENTIAL AUTOMATED COLLECTION PROGRAM TYPE OF ACTION CONSIDER AUTOMATED PROGRAM ISSUES SUBMITTED BY INITIATING DEPT./DIV. Walter N. Funasaki, Finance Officer Administrative/Finance & Accounting ISSUE: Valley Waste Management has raised a number of issues in connection with the full-scale implementation of the automated collection program, which have been submitted for resolution by the District. BACKGROUND: When setting the refuse collection rates of Valley Waste Management effective January 1, 1992, the Board of Directors authorized full-scale implementation of the residential automated refuse collection and separate yard waste collection program. Certain noteworthy features of the automated collection program were the following: · Valley Waste Management would acquire vehicles and refuse containers at a cost of $3.3 million by July 1992 to serve all residential customers, except in the City of Lafayette, in addition to the 7,400 pilot program residents currently being served by the automated program. · The automated collection program would be phased-in on a route-by-route or neighborhood- by-neighborhood basis during the summer and fall of 1992. Residential households would be provided a $1.85 per month rate decrease as the new automated service is received in 1992. The 7,400 pilot program customers in Danville were provided the $1.85 per month decrease effective January 1, 1992. . The most significant expense reduction of the automated collection program would be achieved from the $9.90 per ton fee for the yard waste disposed of at a wood fiber processing facility in Hayward, thus avoiding the $65.69 per ton Acme Transfer Station fee. During the rate-setting process, the refuse collector expressed concerns regarding the depreciable life of the new equipment, the interest rate used to calculate the Capital Use Charge, and the sufficiency of the allowable profit. Valley Waste Management summarized these concerns in a letter dated April 2, 1992, which is provided as Attachment I. At the April 16, 1992 Board Meeting, the Board of Directors considered the issues raised in the April 2, 1992 letter, and made the following determinations: INITIATI,NG DEPT.lDIV. ~ ~--~ REVIEWED AND RECOMMENDED FOR BOARD ACTION 1302A-7/91 WNF PM .---..,--.--- CONSIDER-ISSUES RAISED BY VALLEY WASTE MANAGEMENT IN CONNECTION WITH THE FULL-SCALE IMPLEMENTATION OF THE RESIDENTIAL AUTOMATED COLLECTION PROGRAM SU8JECT PAGE DATE 2 OF 15 April 29, 1992 . The automated collection program equipment will be depreciated over the requested five years, instead of the eight years used in the rate-setting process. . The Capital Use Charge will be calculated using the requested Merrill Lynch Bond Index for 1 - 10 Year High Quality Corporate Bonds, instead of the Two-Year Treasury Note, beginning 1992. . Expense reduction programs initiated by the refuse collector and programs to meet statutory mandates will be considered by the Board within the established rate-setting procedures by adjustment of the Cost of Service and Quality of Service Modification Factors. . Interest on the unapplied balance in the Balancing Account, whether the balance is in favor of the refuse collector or the ratepayers, will be calculated based on the High Quality Corporate Bond Index referenced above. . The refuse collector will be provided full recovery of any balan~e in the Balancing Account in its favor by the last year of the franchise term. The following attachments which summarize the effect of the Board determinations are provided: Attachment II - Equipment Depreciation Using a Five Year Life Attachment III - 1992 Capital Use Charge Recalculation Attachment IV - 1992 Allowable Profit Recalculation Attachment V - Interest On Balancing Account A draft letter to Valley Waste Management in response to its April 2, 1992 letter is provided as Attachment VI. RECOMMENDATION: Consider the draft letter to Valley Waste Management in resolution of the issues raised in the refuse collector's April 2, 1992 letter, provide District staff with any revisions to the draft letter, and authorize the draft letter to be issued in final form. ADS/PosPa er#3/VWMColl. 13028-7/91 -,---------------------------------------------------- Attachment I Valley Waste Management 1990 N. Caliiornia Blvd., Suite 20 P.O. Box 4007 Walnut Creek, California 94596 510/935-8900 ~ \eJ A Waste Management Company April 2, 1992 Walter Funasaki Finance Officer Central Contra Costa Sanitary District 5019 Imhoff Place Martinez, CA 94553-4392 Re: Valley Waste Management's Automated Pickup and Separate Yard Waste Program Dear Walter, This letter is in response to your request for a proposal for Valley Waste Management (VWM) to implement its Automated Pickup and Separate Yard Waste Program (the Program). This program was included as part of the review of VWM's rates, effective January 1, 1992. At the time of the review, we agreed in principle to proceed with the Program provided that an approach for including the program costs in the rates could be agreed to. The present method of cost recovery is inadequate. Although we do not wish to belabor this point, enclosed for your information is a brief analysis that compares the operating ratios of VWM's operations regulated by the Central Contra Costa Sanitary District (CCCSD) with those of other waste companies in the Bay Area and across the United States (Exhibit No.1). The proposed 5 year depreciation method is the lowest of the four alternatives. VWM should receive a higher level of return, as shown in Exhibit 2- 3, but in the interests of proceeding with this Program, VWM is willing to accept the current level of return. Thus, under current rate setting methods, VWM simply cannot afford to invest additional capital. Although VWM requires an adequate method to obtain capital recovery, VWM also recognizes that the CCCSD desires to implement the Program in the near future and that, as a practical matter, CCCSD may not be able to change rates immediately to accommodate VWM's requirements for a modified cost recovery mechanism. With these factors in mind, we have developed an overall approach that meets the needs of both VWM and CCCSD. We recommend that CCCSD adopt the proposal discussed below. Our proposal is a follows: 1. No immediate rate increase. VWM is willing to postpone a rate increase until January 1, 1993 to cover the costs of the Program, provided that CCCSD adopt the cost recovery and other principles described below. a di/:S~:''''' 0' SAV\'LJCO -----....--------r-..--.......... .. Walter Funasaki April 2, 1992 Page 2 ~ ~ A Waste Management Company 2. Capital recovery. The additional equipment that VWM must purchase for the Program will be depreciated over a five-year period. In 1987, assets were depreciated using the Accelerated Cost Recovery System (ACRS) over 5 years. In 1988, Price Waterhouse recommended a change from the accelerated method to a straight-line 5 year method in computing depreciation for rate purposes. Since then, VWM has consistently depreciated its equipment, for rate purposes, using the straight-line 5 year method. By the time the Program is implemented, the current franchise agreement will have only 31h years remaining. So the equipment will not be fully depreciated at the end of the franchise term. Depreciating the equipment over an eight-year period is a change from the current method, and does not allow VWM to recover its investment. The capital use charged for all existing and new equipment will be set annually at the High Quality Corporate Cost of Funds Index, published in the Wall Street Journal. The index is currently at 7.73% Attached is an analysis which compares the cost of the equipment depreciated over 5 years, as proposed, to three alternate capital recovery methods (see Exhibit 2-1): A) with the cost of the equipment depreciated over the remaining 31h years of the franchise (see Exhibit 2-2). B) with the cost of the equipment when the full cost of capital Oncluding the cost of equity and debt) is used (see Exhibit 2-3). C) with the cost of leasing the equipment (see Exhibit 2-4). 3. Incentive mechanism. Regulators of solid waste companies and other utilities are increasingly aware that it is appropriate to share the savings associated with recycling and conservation programs between the ratepayer and the companies providing the savings. For example, the California Public Utilities Commission has recently approved a program in which Pacific Gas & Electric Company will receive a portion of the savings that it realizes in a conservation program. Similarly, many cities and counties include incentives in their rate making procedures for recycling. Such a procedure is an appropriate sharing of the savings from recycling and provides an incentive for a solid waste company to maximize savings. Thus, we propose that VWM and the ratepayers share the disposal cost savings associated with the diversion of yard waste on a 50/50 basis. _. "-------_._----'~.--~._---_._.._-.-...._--,---------_._.~-----------_._"--------"_..~---_.__._._--_._--'_.__.----_.-._-_...,------,-- Walter Funasaki April 2, 1992 Page 3 ~ ~ A Waste Management Company 4. Deferred cost recovery. The adoption of the above cost recovery procedures will increase the costs that VWM uses in determining its rates. VWM will agree to implement the Program without an immediate rate increase provided that CCCSD gives VWM reasonable assurances that the additional costs that are reasonably incurred in conjunction with the Program and described above will be included in future rates. Specifically, we propose that all costs not currently included in rates will accumulate in a balancing account with interest based upon the High Quality Corporate Cost of Funds Index. Ideally, VWM would prefer to have the details of such a balancing account specified before committing to the Program. However, VWM recognizes that this balancing account cannot be developed in a short period of time. VWM is willing to implement the Program provided that the CCCSD adopt the following general principles: 1) The balancing account will allow for a profit margin of $612,000 above all reasonably incurred costs. 2) Reasonably incurred costs will include A) Capital Use (Interest) Charge at the High Quality Corporate Cost of Funds Index B) Capital equipment depreciated over a five-year period 3) The balancing account will include the disposal cost savings associated with the diversion of yard waste on a 50/50 basis. 4) The balanCing account balance will earn interest based upon the High Quality Corporate Cost of Funds Index. 5) CCCSD will provide assurance of full recovery of the balancing account balance at date of franchise expiration. 6) CCCSD Board directs VWM and the CCCSD staff to cooperate in developing the details of the balancing account. These details should reflect the concepts as discussed in this proposal, follow accepted practices for such balancing accounts, and be fair and equitable to both VWM and its ratepayers. _____.M_______..._.__.._____"_._~._____._._...____._....-.---r----.'--....--.-.-- ..------.-----.--.,---.-.-, Walter Funasaki April 2, 1992 Page 4 ~ ~ A Waste Management Company Waste Management's policy is usually to require an adequate increase in rates before investing in additional capital. However, in light of the need to implement the Program in a timely manner, VWM will proceed with the Program provided that CCCSD can formally adopt the policies outlined in this proposal. We look forward to your review and response to this proposal. If you require additional information, please do not hesitate to contact us. <t:~ Controller sl enc cc: Paul Morsen Kent Aim Sanford M. Skaggs 17-214.3.1 .-------,-.-.-.-.--------..-----------.---.---.----.---------_....------ EXHIBIT 1 Comparative Operating Ratios Valley Waste Management CCCSD Regulated Operations CUrrent Operating Ratio Calculation Capital Use Charge Allowance Allowable Profit Profit and Interest Revenues Operating Ratio $ 260,(0) S 612.(xx) S 872,000 $14,820.000 94.1% CITY AUTHORIZED OPERATING RATIO County of Napa City of Napa E1 Cerrito Fairfield Redwood City Richmond San Bruno San Francisco Sunnyvale VacaYillc 89% 90% 92% 90% 86% 86-90% 90% 91% 91% 90.5% COMPANY OPERATING RATIO Browning Ferris Industries Chambers Laidlaw Western Waste 82.1% 75.4% 8L6% 87.8% Average 1989-1990 operating ratio earned OD waste segment operations only. ENERGY UTILITIES OPERATING RATIO San Diego Gas and Electric Pacific Gas and Electric Co. Southern California Edison Weighted Average WATER UTILITIES So. California Water Cal Water Service Weighted Average 74.8% 12.9% ~.3% 78.7% 77.8% 74.2% 76.0% TELEPHONE UTILmES Pacific:: Telesis Roseville Telephone Weighted Average 77.1% 63.0% 76.6% AD opcratiag ratios arc before interest and taxes. ---------------.--------.---------------"-"]"--.------------- - -- - -- - c (I) E Q. .- ~ tT W (I) > - o.J as .... as Co - E .co ~O >- ... ~ o (,) Q) a: - U) o o 0;0 o 0 C?...~ ... " CONO r-:.&t:l~ .--C') ... 6jl) Cii o o - c: III e CO Q. oK CI) c:lS '-(,)-- :::a _ ~ 0 cr-eaL- wt=o""" ~~ ::~ "'>> ... i~ e!~ - CO) i~~~-~ ---N >:1 t; OO~"'>> i~~N~ .-C\lN(\') CDCOC\lOco >COC')..." ....: .. OO~" CO...cn" i ~ .... C') ~ ~:g:C'):! >CDO')-c:a ....; .. 0010 CONCO)- C\I"'Q) 0 ....:ui fD aGCO'" CD ~~"tN~ N 00~c-., CDO "It "It'lf ..... - .. . -" "- i-ceoll)- -co(\')c-.,cn >"cw) ... If. CO) "- ~ I ~ CD @JO c: (1)015 ~ E'a as (I) CIS ~ ggaa a~~c:i. -8CD:::l~ ~iiiai- c:lS~~S CD Q. Q.. 0 >-asas.... U)o(,) . ...... co ~ ~ C? : - i g c.; - N ... ClS ~~I e!~ - (\') j 000 .. eft :& ~ CD ~ t-i :a~ Q) as >0 &l)t- ... as ~~I e!~ - C') OOC\lN iCDc:aU)(\') ....."'ltCDC') CD":":cw)ui >~!eJe - .. 00&1)"'>> i~~~~ -C\l"0) CDCOC\lOCO >Cl)C')Nc:a ....: ... 00"" CD"lt"'>>(\') i...."'>>O ~..:.;..:cw) coc:a_,.... >Cl)~(\')0) ....: 6jl) 000')0') CDC\lOQ) i ~ O!. "". C&t ca-&t)"'>>CD CO"lt...." >~~""C? N ... 6& OONC\I CDOCO. 'It'llltC\l,... j..:,.:o;o ~COO...c:a CO(\')It)- ~..co? ..: ... '& o " iii .... ..: Q. (I) @JC c: CI> 015 .2 e>> d> ii CD ClS ... -(,).c.c (,)c:00 ;':CZlc:i. CZl CD ~ lD '0__0 :as!!1\; ~~g.o Il)(,)(,)t- ~ - ~ co C&t ~ - Cl) N iii' ~ :l ----------------,------------------------------------------ CDCON" jCOCOco" "'''''It''ltN'' ~c.;r!flio " .- _ 0') >~"lt ~ "'''0')_ ""'>>CQ.. jCft'llltIO"'>> "':t:g~ >(1) 0') ''It _ 0 .... . ... - ... -0')10" "N_CO jCft"ltCD"'>> ii~~~ >0')(\')..._ ... - - N _ .. -ON(\') "OCO('l) 0').. CD CD -jj:tms Cl)Cft(\,)NN >-cw) .: .. If. ~ ~ ~ c: II) .2 ~C ii CD .e f:3 a" Q)CDii2>> ~(,).c.c CDiOO ~'iiic:i. :CD=~ >-cea- N:=:! ;:g.i~ (\')(,)(,) :a~ C1>_ >~ "'>> ... :~ >- ca ~~ ... CO) Ci - Q. as (,) i ~ ~ c: a:l as "8- CIS (,) ~ .S go o - CI) o (,) Q) .c - i~; c: . < Q) In ~ In (I) '0 ~ '0 oS - ct) o o III a as ... (I) > < 'i - ~ o 'a; 3: - ...... - j j i N ... as ~ ;I ~I 'lilt CD :h ~ ~ ~ .. cor I : ~ ~ ~ ~ .. ~ "'>> i eft N .. g CO) (It) "'>> co .. ~ CD N C') 0') .. ~ CD N C') en .. eft o CO) (It) "'>> CD .. 0) o CO) c-; "'>> co 6& " CD CD N CO) Gl .. 0) o CO) c-i "'>> co - " CD CD c.; CO) Gl .. ~ o (\') vr It) c:a .. .... c:a CO N CO) 0) ... "S- O Q) iii N -s. o C\I cO C\I >. 5 Q.. e o o ?;o ";; ::I o < < < ~ Ci ::I .0 >-- c:- as "2 Q.... Eo o II) 00 -as Cij... e ~ 0< = .... c Q) E .J::. (.) ro .... .... <: w :::l ...I <: > ~ o o !Xl ti:i z c z <: w en Z w Q.. X W Z o i= <: ~ U z w w a: ~ fb w c c:I c <: w Z ~ <t U ~ w w ...., ~ 0 en g: ~ >- W ...I ...I <: > ~ z w ~ Q.. 5 o w ~ <: a: c:I o a: Q.. z o i= u W ...I ...I o U c w ~ <t ~ o ~ :::l <t ~ roN Q)O') >-0') - .- ro .-e l1. co ~ " 0') 0') <0 0') 0') .- 10 0') 0') <:t 0') 0') .- M 0') 0') +.: II) o U o OlO~ 000 o<:t<:t "':<0" CXlNO "10M ~.....('W') 0- 0- .... C Q) E c. .5 0- w "t:l Q) .... (.) Q) .0 ~ Q.. II) ~ II) (.)1: ;: ro ~u c o ..:; ro .(3 Q) ~ ~ .-," "t:l Q) ~ II) (.) C .~ Q) e x Q..w ; ~ ~ ~j ~ ~j ~ II) ~ ro Q) >- 10 ij ~ ~ ~ ~ ~ !;:! Q) ::J l\i > ~ o o !Xl .... Q) Z II) "t:l ~ Q) ro .... Q) (.) >- .~ 10 It '.'~._'---'-"'----'---"---- >- S:! "5 c. Q) .... ro o c. ~ o (.) .J::. .... ~ Q.l (.) c ro "t:l o (.) (.) ro .5: Q.l ::J l\i > Q.l Cl ro > l\i II) o .... G.i Cl ~ ro .J::. U Q) II) :::l co .... .0. ro U Q.l .J::. .... Cl C ..:; ro "S (.) l\i (.) "t:l ro Cl ~ .... ::J o .J::. .... .~ en .... Q.l II) II) ro ro .... .0. ro (.) II) Q.l .... ro .13 Q.l 0. Q.l "t:l .... C Q) E Q.l Cl ro c ro ~ Q.l .... en ro ~ ~ o ..... en .Cij ro .0 Q) .J::. .... .~ Q.l ::J l\i > ~ o o !Xl 1: u ci ~ <I: ~ ~ M .. tl Cl "0 ::l al en Cl <I: .... Q) Z Q.l .J::. ~ > ~ l\i > ~ en Q.l .... o Z VALLEY WASTE MANAGEMENT 1992 CAPITAL USE CHARGE RECALCULATION AND EFFECT ON ALLOWABLE PROFIT (000 Omitted) 1992 Caoital Use Charae Recalculation Revised Net Tangible Fixed Assets, December 31, 1991 One-half of net Capital Additions in 1992 Capital Use Base Interest Rate: 1-10 Year High Quality Corporate Bonds Two-Year Treasury Note $3,395 430 3,825 7.73% 296 ADS/PosPa per # 2/VlyCa pit. cht Attachment III Original 3,395 430 3,825 6.80% 260 Attachment IV VALLEY WASTE MANAGEMENT 1992 ALLOWABLE PROFIT RECALCULATION < 000 Omitted> Income Income High Quality < Loss> Recorded < Loss>, Net Net Tangible Corp. Bonds Capital Use Before Interest of Capital Use Fixed Assets Int. Rate Charge Taxes Expense Charge 1990 $ 828 8.93% $ 74 $673 $50 $649 1989 802 8.96 72 490 37 455 1988 1,31 5 9.77 128 542 36 450 1987 1,048 7.54 79 <142> 92 < 1 29 > 1986 1,112 8.96 100 513 90 503 1985 679 9.60 65 767 54 756 Profit, Net of Capital Use Residential Customer Charge, Restated in Equivalent Units Profit/ 1 990 Dollars (RCEU) RCEU 1990 $649 47,200 $13.75 1989 475 43,284 10.97 1988 493 46,699 10.56 1987 <148> 45,177 <3.28> 1986 592 52,752 11.22 1985 918 44,492 20.63 Average Profit Per RCEU (1) Incremented by CPI: 1991 $11.63 X 1.039 = 1992 $12.08 X 1.028 = $11.63 1992 RCEU $12.08 $12.42 1.05 13.04 48.287 $630 1992 Modification Factor Allowable Profit (1) Based on average for four years after deleting lowest and highest two years. ADS/PP# 2/VlyCa pit. cht ~~-r-'-'--~-"--.__.'_._'--~'----'-'_."-~-'--''''-''-'---..-.----.----..-.-..-.---.---.-.....----.-.-....-'.-.-_..._-_._...,-,._~,.._------,._-_._-- Attachment V VALLEY WASTE MANAGEMENT INTEREST ON BALANCING ACCOUNT The Balancing Account operates to adjust the following year's collection rates for any difference between forecasted operating results used to set rates for a particular year and the actual results of operations for that year. Because actual results of operations are not finalized until the audited financial statements are obtained, it will normally require one subsequent rate-setting year before the final adjustment to a particular year's Balancing Account amount is made. The adjustment in the subsequent year to the amount in the Balancing Account and an interest computation using an average balance method are illustrated below. 1992 Rate-Settina Year: Difference between 1 991 forecasted and projected Income Before Taxes: Due to (from) Refuse Collector Interest on Balancing Account: $100,000 x 1/2 year x 7.73% Applied to increase 1992 collection rates 1993 Rate-Setting Year: 1991 Balancing Account amount adjusted from $100,000 to $120,000 based on audited financial statements Interest: $20,000 x 1 year x 7.73% Balancing Account $100,000 3,865 $103,865 $20,000 1,546 21, 546 Difference between 1992 forecasted and projected Income Before Taxes: Due to (from) Refuse Collector Interest on Balancing Account: $150,000 x 1/2 year x 8.0% < 150,000> Applied to decrease 1993 collection rates <6,000> < 156,000> $ < 134.454> ADS/Position Paper #2/VlyBaIAc.Cht ---r----.~..."..._.,-u~-.-.---~.,...---.-^...,.,--"-.-~--.~.,__.M__~____..__m_,__..________"~.,.__M,__'__,._._,,,_.___._..MM.___ ~...- c Valley Wi:!;;ie Management 1990 N. Caiiiornia Blvd., Suite 20 PO. Box 4007 Walnut Cree: Californ:c 94595 510'935.890( IQ ~ A Waste Management Company May 5, 1992 President Parke Boneysteele and Members of the Board of Directors Central Contra Costa Sanitary District 5019 Imhoff Place Martinez, CA 94553-4392 Hand Delivered Dear President Boneysteele and Board Members, Valley Waste Management is moving forward with our proposal to the Central Contra Costa Sanitary District for automated garbage and separate yard waste collection. This program represents a substantial cost reduction to the ratepayers in Danville, Alamo, and unincorporated Walnut Creek. Because of the $52/ton disposal savings that are realized with the separate yard waste collection,. CCCSD is able to pass on about $1.85 savings per month per customer. Valley Waste Management is proud to have been able to provide this opportunity to the District and our customers. It is important for the District to realize that these significant savings are the result not only of Valley Waste Management's efforts, but also those of our regional office. The resources of Waste Management have provided the opportunity to divert approximately 30% of CCCSO's residential wastestream at a substantial savings. Our Region management negotiated an attractive contract with Waste Fibre Recovery of Hayward to deliver large quantities of wood to them. As part of that contract, they also negotiated the ability to deliver yard waste as a percentage of the total volume delivered. Yard waste is not the material of choice for the processor. What Waste Fibre Recovery really wants is wood, and the vast majority of wood is being delivered by another Waste Management division. Their efforts are providing the opportunity to deliver the District's residential yard waste to Waste Fibre Recovery. The District should note that its residential waste stream does not generate the volume of wood needed to allow Valley to bring the percentage of allowable yard waste to Waste Fibre Recovery. As the Board has pointed out before, a large company like Waste Management has the size and strength to negotiate favorable contracts such as this one. Valley Waste Management will continue to explore opportunities like this with our parent company that are in the best interests of our customers. C:. SA,\\'O,-~,.= Attachment VI May 8, 1992 DRAFT Mr. Ronald J. Proto, General Manager Valley Waste Management 1990 N. California Boulevard, Suite 20 Walnut Creek, CA 94596 Dear Mr. Proto: Your letter dated April 2, 1992 addressed to Walter Funasaki, Finance Officer, summarized issues which you wish to have resolved b~fore implementing the residential automated collection program on a full-scale basis. At the April 16, 1992 and May 7, 1992 Board Meetings, the issues identified in your letter were discussed and considered by this District's Board of Directors. The Board's determination on each of the issues is provided in the following sections of this letter. Deoreciable Life of New Automated Eauioment The Board concurs that the equipment to be acquired for full-scale implementation of the program should be depreciated over five years, instead of its eight-year useful life, using the straight-line method. The shorter depreciation period is appropriate in consideration of the expiration of the base term of the franchise agreement in 1996. Rate Basis for Caoital Use Charae -.---------.---.--....-...-.-..---,-----------.----- The Board will establish the Merrill Lynch Bond Index for 1-10 Year High Quality Corporate Bonds, instead of the Two-Year Treasury Note, as the basis for the rate to be used in calculating the Capital Use Charge beginning 1992. Incentive to Achieve Exoense Reductions and Imolement New Programs The Board considered your request that fifty percent of the expense reduction to be achieved from the separately collected yard waste to be disposed of at the Hayward facility, instead of the Acme Interim Transfer Station, be provided as additional profit to your company. The Board also considered your request to modify the calculation of Allowable Profit to recognize the successful implementation of residential and commercial recycling programs. The Board will be provided with information regarding clearly defined expense reduction programs to be initiated, and confirmation of the results of those programs through staff review, as a basis for setting the 1 993 Cost of Service Modification Factor. The Board will consider the successful efforts of the refuse collector in implementing programs to meet solid waste reduction mandates when setting the 1 993 Quality of Service Modification Factor. Balancing Account The 1992 Balancing Account amount will include the effect of depreciating the new equipment over five years, and the recalculation of the Capital Use Charge using the High Quality Corporate Bond Index. -----------------,----- Interest on the unapplied balance, whether the balance is in favor of the refuse collector or the ratepayers, will be added to the Balancing Account. The interest will be calculated based on the High Quality Corporate Bond Index. Full recovery of any balance in the Balancing account in its favor will be provided to the refuse collector by the last year of the franchise term. The Board will be provided with a written report which describes the manner in which the Balancing account amount is to be determined, based upon the general principles outlined above and during the last rate-setting process. The report will be prepared with the involvement and cooperation of the refuse collector, and should be submitted to the Board by July 1992. The Board believes that each of the issues raised have been addressed in this letter. It is hoped that the issues have been satisfactorily resolved, and the benefits of the automated collection program will be realized by its scheduled implementation. Sincerely, Parke L. Boneysteele President of the Board of Directors PLB:dp ADS/Funasaki#2/Proto3.1tr -----------------------------,--- Central Contra Costa Sanitary District BOARD OF DIRECTORS PAGE 1 OF 2 Ma 7, 1992 NO. 7. ADMINISTRATIVE a. DATE May 1,1992 BOARD MEETING OF SUBJECT CONSIDER AN APPEAL TO THE BOARD OF DIRECTORS OF A DENIAL OF AN EMERGENCY WITHDRAWAL REQUEST BY THE DEFERRED COMPENSATION PLAN ADVISORY COMMITTEE TYPE OF ACTION CONSIDER APPEAL SUBMITTED BY INITIATING DEPT./DIV. alter N. Funasaki, Finance Officer Administrative/Finance & Accounting ISSUE: An application for emergency withdrawal of funds, which was denied by the Deferred Compensation Plan Advisory Committee (Committee), is being appealed to the Board of Directors. BA K R NO: William O. Gay, Jr., Maintenance Crew Leader, submitted an application dated April 6, 1992 for an emergency withdrawal of funds from the Deferred Compensation Plan. Mr. Gay seeks to obtain $4,000 from the Deferred Compensation Plan to satisfy a judgment of dissolution of marriage. The application was considered by the Deferred Compensation Plan Advisory Committee on April 8, 1992 and denied. The District's emergency withdrawal procedures provide an opportunity to appeal a denial to the Board of Directors. The Committee is responsible to review applications for emergency withdrawals and to recommend approval of those which meet the Internal Revenue Code (lRC) requirements which govern Section 457 Deferred Compensation Plans. The single exception permitted by the IRC to the normal distribution of deferred compensation funds due to retirement, termination, death, or disability is an emergency withdrawal. An emergency withdrawal is permissible only if an unforeseen emergency beyond the Plan participant's control exists. An unforeseen emergency is defined by the IRC as a severe financial hardship to the participant resulting from a sudden and unexpected illness or accident to the participant or a dependent 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 Committee concluded, with the assistance of District Counsel, that Mr. Gay's application for funds to satisfy a judgment pursuant to a dissolution of marriage did not meet the Internal Revenue Code requirements for an emergency withdrawal. In the course of the Committee's review of Mr. Gay's application, Mr. Gay has alluded to a prior instance in which an emergency withdrawal was approved by the Board pursuant to a court order. In 1983, in response to a court order arising from the dissolution of the marriage of a participant in the Deferred Compensation Plan, the Board did allow the emergency withdrawal of funds to satisfy the court order. In that instance, the court order explicitly directed that the District's Deferred Compensation Plan pay specified sums to the participant's former spouse, as well as her attorney's fee. The circumstances of Mr. Gay's judgment are not the same as the 1983 court order. INITIATI,NG DEPT.lDIV. d~~.--/~ 1302A-7/91 WNF PM KLA --------------.....,.--,._--"'~".._--~._'----~.....--_._-~._-_.,..,_.._..,~. ,._-_...~_._---,.,-_._----_._-_._-,_._- ----.------ SUBJECT ~ONSIDER AN APPEAL TO THE BOARD OF DIRECTORS OF A DENIAL OF AN EMERGENCY WITHDRAWAL REQUEST BY THE DEFERRED COMPENSATION PLAN ADVISORY COMMITTEE 111111111111111111::111111:1:[ PAGE 2 DATE OF 2 May 1, 1992 "'he Committee's denial of Mr. Gay's application for emergency withdrawal should be upheld for he following reasons: It The basis for the application for emergency withdrawal does not meet the requirements set by the Internal Revenue Service (IRS). Nonadherence to the IRS requirements could jeopardize the tax-deferred status of the entire plan. . The judgment of dissolution of Mr. Gay's marriage does not order that the $4,000 settlement be drawn from the Deferred Compensation Plan, but merely indicates that the amount represents the former spouse's share of Mr. Gay's funds in the Deferred Compensation Plan. While not commenting on the merits of the court order in 1983, it should be recognized that there is a significant difference between the present and the 1 983 court orders. RECOMMENDATION: Uphold the denial of the application of William D. Gay, Jr. for emergency withdrawal of $4,000 from the Deferred Compensation Plan. 13028-7/91 I ,~---_.__._-_.._--_.._----_._----,_..._-~~_.._-,-_._"--"'..____.._..,_._0._._..._.___________ PAGE 1 OF 1 AUTHORIZE ALLOCATION OF $15,000 FROM THE TREATMENT PLANT CONTINGENCY ACCOUNT FOR METEOROLOGICAL STATION UPGRADE PROJECT (DP 10089) NO. 8. TREATMENT PLANT a. DATE Ma 5, 1992 TYPE OF ACTION AUTHORIZE ALLOCATION SUBJECT SUBMtTTEQ BY \,;narles W. Batts Plant Oper.ations Department Manager INITIATING DEPTJOIV. Plant Operations Department ISSUE: Authorization of the Board of Directors is required for the General Manager-Chief Engineer to allocate funds in excess of $25,000 for a new project from the Treatment Plant Program Contingency Fund when it is not listed in the Capital Improvement Budget. BACKGROUND: In July, 1991, the Bay Area Air Quality Management District (BAAQMD) issued a new guidance document for meteorological monitoring. The District's current equipment does not conform to the standards established within the guidance document. The new meteorological equipment will comply with the stringent and exacting data accuracy required by BAAQMD. This data will be used for future AB2588 Health Risk Assessments and current odor monitoring. The meteorological monitoring equipment consists of a wind speed sensor, wind direction sensor, temperature probe, relative humidity sensor, precipitation gauge, and a dedicated data collection system. Because of the recent requirement for this project, it was not anticipated in the 1 991-92 Capital Improvement Budget. . Therefore, staff recommend Board Authorization of contingency funds for this project. The current balance in the Treatment Plant Program Contingency Account is sufficient to fund this allocation. An initial $25,000 contingency allocation has been approved by the General Manager-Chief Engineer to prepare the specifications and prepurchase equipment. The total cost for this project is estimated at $40,000. Staff has determined that this project is exempt from the California Environmental Quality Act (CEQA) under District CEQA Guidelines Section 18.2 since it involves alterations to existing plant facilities with no expansion of capacity. Board of Directors' approval of this project will constitute a finding of an agreement with this determination unless otherwise indicated. RECOMMENDATION: Authorize the General Manager-Chief Engineer to allocate $15,000 from the Treatment Plant Contingency Account for Meteorological Station Upgrade Project, DP 10089. Wi)c/J 1302A-7/91 VIEWED AND RECOMMENDED FOR BOARD ACTION RJCHIEF ENG. JCP " CWB Central Contra Costa Sanitary District BOARD OF DIRECTORS PAGE 1 OF 1 Ma 7, 1992 NO. 12. BUDGET AND FINANCE a. BOARD MEETING OF SUBJECT DATE APPROVE THE 1992-1993 EQUIPMENT BUDGET FOR INCLUSION IN THE 1992-1993 DISTRICT BUDGET TYPE OF ACTION APPROVE EQUIPMENT BUDGET SUBMITTED BY INITIATING DEPT./DIV. Walter Funasaki, Finance Officer Administrative/Finance & Accounting ISSUE: The District's 1992-1993 Equipment Budget is submitted for approval. BACKGROUND: The 1992-1993 Equipment Budget was submitted for review at the April 16, 1992 Board Meeting, and is scheduled for approval by the Board on May 7, 1992. The Board's Capital Projects Committee reviewed the 1992-1993 Equipment Budget with District management prior to the submission of the budget to the Board on April 16. The approved 1992-1993 Equipment Budget will be scheduled for adoption with the 1992-1993 Personnel, Operations and Maintenance, Self Insurance Fund, and Capital Improvement Budgets on June 18, 1992. RECOMMENDATION: Approve the 1992-1993 Equipment Budget for inclusion in the 1992- 1993 District Budget to be adopted on June 18, 1992. REVIEWED AND RECOMMENDED FOR BOARD ACTION INITIATI,NG DEPT.lDIV. I ~'. 1302A.7/91 WNF PM ADS/PosPaper #1/FinEqupB.PP ...--....... ---,....-...-.----.---.--..-..--......----.---..--.-..--.--