HomeMy WebLinkAboutBUDGET & FINANCE AGENDA 05-04-09~~ Central Contra Costa Sanitary District
Protecting public health and the environment 5019 Imhoff Place, Martinez, CA 94553-4392
BUDGET AND FINANCE COMMITTEE
Chair Lucey
Member Nejedly
Monday, May 4, 2009
3:00 p.m.
Executive Conference Room
5019 Imhoff Place
Martinez, California
INFORMATION FOR THE PUBLIC
ADDRESSING THE COMMITTEE ON AN ITEM ON THE AGENDA
.Anyone wishing to address the Committee on an item listed on the agenda will be heard when the
Committee Chair calls for comments from the audience. The Chair may specify the number of minutes
each person will be permitted to speak based on the number of persons wishing to speak and the time
available. After the public has commented, the item is closed to further public comment and brought to the
Committee for discussion. There is no further comment permitted from the audience unless invited by the
Committee.
ADDRESSING THE COMMITTEE ON AN ITEM NOT ON THE AGENDA
In accordance with state law, the Committee is prohibited from discussing items not calendared on the
agenda. You may address the Committee on any items not listed on the agenda, and which are within their
jurisdiction, under PUBLIC COMMENTS. Matters brought up which are not on the agenda may be
referred to staff for action or calendared on a future agenda.
AGENDA REPORTS
Supporting materials on Committee agenda items are available for public review at the Reception, 5019
Imhoff Place, Martinez. Reports or information relating to agenda items distributed within 72 hours of the
meeting to a majority of the Committee are also available for public inspection at the Reception. During
the meeting, information and supporting materials are available in the Conference Room.
AMERICANS WITH DISABILITIES.4CT
In accordance with the Americans ~4'ith Disabilities ;1ct and Caliti~rnia Law, it is the policy of the Central
Contra Custa Sanitary District to offer its public meetings in a manner that is readily accessible to
everyone, including those with disabilities. If you are disabled and require special accommodations to
pcu-ticipate, please contact the Secretary of the District at least 43 hours in advance of the meeting at (92)
339-7303.
(`)2_~) 228-900
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® Recycled Paper
Budget and Finance Committee
May 4, 2009
Page 2
1. CALL MEETING TO ORDER
2. PUBLIC COMMENTS
3. 'OLD BUSINESS
*a. Review Outstanding Questions
*b. Trucker Huss invoice and written response
4. CLAIMS MANAGEMENT
*a. Review Outstanding Claims
5. REPORTS/ANNOUNCEMENTS
*a. Bank Account Security Invasion (Novato Sanitary District)
6. REVIEW EXPENDITURES (Item 7. a. in Board Binder)
a. Review expenditures
'`b. Review P-Card expenditures
7. ,REVIEW MARCH 2009 FINANCIAL STATEMENTS (Item 7.b. in Board Binder)
8. ADJOURNMENT
* Attachment
3.0..
Central Contra Costa Sanitary District
May 1, 2009
TO: BOARD BUDGET AND FINANCE COMMITTEE
FROM: RANDALL MUSGRAVES
DEBBIE RATCLIFF
SUBJECT: April 13, 2009 Finance Committee Meeting
There were five outstanding questions from the last Board Budget and Finance
Committee meeting which required additional staff research. The questions and
answers are provided below:
1. 174973 Frontier Analytical Laboratory -Could these test be done in-house
or with another lab to reduce the cost?
The District contracts with two labs, Frontier and Vista for Dioxin analysis.
Frontier is about $200 per sample cheaper than Vista. Both labs are certified by
the State Department of Health Services ELAP. The data has to meet the ELAP
requirements and our own data quality objectives. Once a year, staff compares
prices and picks the lowest cost, qualified lab.
Staff performs many of the lab tests in-house. However, Dioxin, chlorinated
pesticides, polyaromatic hydrocarbons, radioactivity, hexa chromium, organic
lead, and methyl mercury are sent to outside labs. Very expensive
instrumentation is needed to test these chemicals and staff believes it is not cost
effective to purchase the instrumentation for samples that are tested two times a
year.
2. 175001 Occhicone Landscape What are the terms of this contract?
Staff has researched the contract with Mike Occhicone for landscaping services,
specifically late invoicing. The contract calls for invoicing to be submitted by the
10th of the following month, for work performed that month. Staff looked to see
how late invoices have been submitted. It is difficult to determine actual time due
to the lack of date stamping the invoice upon receipt. Furthermore, research
indicates that often times invoices are processed slowly within the District. Staff
is looking to see what options are available to ensure timely billing. There is an
invoice in the current expenditure report for mowing that occurred in 2008. That
invoicing is clearly unacceptably late. The District's Purchasing Manager will be
at the Committee meeting to discuss additional direction from the Committee.
3. 175022 Steelhead Data -What was this invoice for and why is it so costly?
This invoice for $11,202 is for the Equal Logic SAN or Storage Area Network.
This is a centralized disk drive storage system that can be attached to any
network server and can be expanded to store terabytes of disk drive space.
Currently, the SAN is being used to store all TV inspection video and Group
folders where different work groups store their documents.
The original SAN system purchased in 2007 cost $100,000 for hardware and
installation. Within one year, a second expansion cabinet was purchased for
approximately $55,000. This invoice is for yearly maintenance of all SAN
equipment with seven day support and four hour response time. The
maintenance cost is less than 10% of the cost of the equipment. Typically,
hardware support is between 15%-25% of the cost.
~4. 175194 Concord Graphic Arts- Is this the cheapest cost for "Leave
Request Forms"?
Staff checks on the price of printing forms periodically, however, official quotes
are not obtained since this expense is under the $3,500 limit. There are no
companies that specialize in printing only forms. A separate company provides
the multiple part paper to Concord Graphic Arts. Staff continues to use Concord
Graphic Arts because it is the cheapest.
5. 175247 Slide4Less -Why are we using segways at the Pump Stations?
We are using segways at several pump stations including San Ramon,
Moraga, Martinez and Fairview. They are being used to inspect some of
the force mains that do not have access by truck. The inspection of the
force mains for possible leaks is a monthly program put into place at the
General Manager's direction as a preventative maintenance measure to
ensure early detection of problems, including leakage.
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April 14, 2009 ~!,V;:1~. i~l,a~ll~•r
Ruth Bennett
Central Contra Costa Sanitary District
5109 Imhof Place
Martinez, CA 94553
Re: Credit of $375 on Invoice 33091
Dear Ms. Bennett:
Enclosed is a check for $375 to credit your account on Invoice 33091. On March 20`h we
received full payment of $1,141.25 from you on this invoice. Per Ms. Ratcliffs request, we
recently wrote off one hour of Liz Loh's time. I have enclosed a copy of the updated invoice
reflecting the reduction of $375, and the new invoice total of $766.25.
Please let me know if you have any questions or concerns.
Sincerely,
TRUCKER • HUSS
V
Michele Graham
Accounts Receivable
MG:mg
Enclosures
Cc: Debbie Ratcliff, Central Contra Costa Sanitary District
+~ ~)9•#U41 •1/ 13/211119 1.117 P'~1
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March 13, 2009
Attn: Ruth Bennett
Central Contra Costa Sanitary Dist.
5019 Imhoff Place
Martinez CA 94553
Our Client Number 2107-003
Invoice number 33091
Regarding: Cafeteria Plan
Hours Rate Amount
02/24/09 EL Analyze Cafeteria
Plan taxable
benefits issue. 0.8 375.00 300.00
JHB Telephone call with
Ratcliff re taxable
benefits in
Cafeteria Plan. 0.3 575.00 172.50
JHB Review Section 125
regulations re ~~
inclusion of taxable
benefits. `t 0.25 575.00 143.75
u
02/26/09 EL ~a~t email
regarding after tax
employee 1
contributions. 1.1 375.00 412.50
02/27/09 EL Further draft email
regarding after tax
benefits under a
Cafeteria Plan. 0.3 375.00 112.50
-
Total Attorneys Fees
- ------
2.75
------ - ------------
$1,141.25
Total
current --
charges -----------
$1,141.25
Total Amount Due $1,141.25
March 13, 2009
Central Contra Costa Sanitary Dist.
Regarding: Cafeteria Plan
Summary Hours
Our Client Number 2107-003
Invoice number 33091
Rate
Amount
Julie Burbank 0.55 575.00 316.25
Elizabeth Loh 2.20 375.00 825.00
v~~~.~- ^1:L1cKC~~ ~ Huss
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Attn: Ruth Bennett
Central Contra Costa Sanitary Dist.
5019 Imhoff Place
Martinez CA 94553
f~ Ic~~h,~llc•
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March 13, 2009
Our Client Number 2107-003
Invoice number 33091
Regarding: Cafeteria Plan
Hours Rate Amount
02/24/09 EL Analyze Cafeteria
Plan taxable
benefits issue. 0.8 375.00 300.00
JHB Telephone call with
Ratcliff re taxable
benefits in
Cafeteria Plan. 0.3 575.00 172.50
JHB Review Section 125
regulations re
inclusion of taxable
benefits. 0.25 575.00 143.75
02/26/09 EL Analyze email
regarding after tax
employee
contributions. 0.1 375.00 37.50
02/27/09 EL Further draft email
regarding after tax
benefits under a
Cafeteria Plan. 0.3 375.00 112.50
-
Total Attorneys Fees ------
1.75 --- ----------
$766.25
-
Total ------
current ---
charges ----------
$766.25
Total Amount Due $766.25
TRUCKER • HUSS
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March 13, 2009
Central Contra Costa Sanitary Dist.
Our Client Number 2107-003
Invoice number 33091
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Regarding: Cafeteria Plan
Summary Hours
Rate
Amount
Julie Burbank 0.55 575.00 316.25
Elizabeth Loh 1.20 375.00 450.00
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Page 1 of 1
Debbie Ratcliff -Cafeteria Plan Question
From: "Elizabeth Loh" <ELoh@TruckerHuss.com>
To: <dratcliff@centralsan.dst.ca.us>
Date: 2/27/2009 10:14 AM
Subject: Cafeteria Plan Question
CC: "Julie Burbank" <JBurbank@TruckerHuss.com>
Hi Debbie,
Julie asked that I provide you with an update regarding how the proposed cafeteria plan regulations that were issued in
August of 2007 address benefits purchased with after tax employee contributions. As you are aware, a cafeteria plan
must offer a choice between at least one "permitted taxable benefit" such as cash and at least one qualified benefit.
Under the 2007 proposed cafeteria plan regulations, "permitted taxable benefits" include certain benefits purchased
with after tax employee contributions. The proposed cafeteria plan regulations list the following as examples of
benefits that may be purchased with after tax employee contributions:
. long term disability coverage,
. group term life insurance on the life of the employee,
. accident and health plan coverage, and
. dependent care assistance program coverage. (Prop. treas. Reg. Section 1.125-(h)(1)
The proposed cafeteria plan regulations do not list membership at a physical fitness center as the type of benefit that
may be purchased with after tax employee contributions through a cafeteria plan. Further, the proposed cafeteria plan
regulations do not address the cashing out of unused taxable benefits. However, please note, these regulations have
not yet been finalized and are subject to change. When the proposed cafeteria plan regulations are finalized, we will
provide you with an update regarding how the new rules impact your cafeteria plan.
Sincerely, Liz
From: Debbie Ratcliff [mailto:dratcliff@centralsan.dst.ca.us]
Sent: Monday, February 23, 2009 5:04 PM
To: Julie Burbank
Subject: RE: Cafeteria Plan Question
Hi Julie
Hope all is well with you. We are in the middle of labor negotiations and a question came up that we answered for the
negotiating team, however, they want to hear it from you!
It has to do with taxable options. The question is : Is it legal for the District to refund cafeteria monies at the end of
the year when the monies were not spent on taxable benefits. For example, I authorize the plan to take $50 per month
for health club and then I drop out of the health club mid year, the District would refund me the six months that I
didn't spend on health club.
Can you provide legal language to support giving back unspent taxable monies? I looked in the Plan Doc and couldn't
find anything written to support this practice.
Thanks for your help.
Debbie Ratcliff
CCCSD
925-229-7326
file://C:\Documents and Settings\dratclifflLocal Settings\Temp\GW~OOOOI.HTM 4/1/2009
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Central Contra Costa Sanitary District
April 30, 2009
TO: Budget & Finance Committee
VIA: Randy Musgraves, Director of Administration 1~~
FROM: Shari Deutsch, Safety & Risk Management Administrator
Debbie Ratcliff, Controller .Daz
SUBJECT: Computer Fraud Risk Assessment
A California sanitary district recently learned that their bank account was illegally
accessed via computer and funds were transferred to another party's account. Upon
learning of this breach today, staff began a review of our internal practices regarding
electronic fund transfers, liabilities for any loss of funds, and avenues of recovery should
a similar attack affect District accounts.
The impacted district is discussing what measures can be taken to safeguard there
accounts in the future. One possible step they are reviewing is to fax an authorization to
the bank first before any funds can be transferred. Central San has been doing this step
since inception of direct deposit at the District.
The following summarizes the District's exposure and steps we are taking to further
define and address this risk.
County as District Treasury
As specified in the Sanitary District Act of 1923, the County serves as the District's
Treasurer unless the District takes steps to assume this function. To date, we have not
done so. Therefore, all District revenue and expenditures are routed through funds
owned and controlled by the County. Per section 6799 of the Health & Safety Code,
"The county treasurer and sureties upon his official bond are liable for the due
performance of the duties imposed upon him by this part [Sanitary District Act of 1923]"
This means that if any money is improperly transferred from District funds held by the
County, the County has suffered a loss, not necessarily the District. Per section 6799, it
is unlikely that the County would be able to pass that loss onto the District. However, if
the County attempted to do so, the District could make a claim against the County to
recover those lost funds. Lost funds could be recovered from three sources: 1) the
County Treasurer's surety bond, 2) the County's self-insured liability fund, and 3) any
insurance policies held by the County covering fraud or theft. Staff has asked the
County to provide details on its surety bond and any insurance coverage it has for these
types of losses.
Another possible source of recovery is Wells Fargo Bank, the bank used by the County.
Since these funds are not held by the District, we could not seek recovery from the bank
directly. However, the County may be able to recover some of its losses pursuant to its
agreements with Wells Fargo Bank.
District-held Accounts
The District has a direct exposure to fraud and electronic theft for funds held in its own
name. Staff has identified three accounts where the County is not the custodian of
District money: 1) the LAIF investment account, 2) the debt reserve account with US
Bank, and 3) the investment account with the Bank of New York. While District monies
deposited into and withdrawn from these accounts are made by the County pursuant to
District instructions, these accounts are not held by the County and therefore, may not
be included in the County's obligations under section 6799 of the Health & Safety Code.
If any funds were illegally withdrawn on these accounts, the District would only recover
amounts the three institutions agreed to protect as specified in the institutions' account
terms and conditions and any fraud policies established by each institution. Staff is
currently reviewing the District's LAIF documentation and trust agreements with US
Bank and the Bank of New York to identify any limits of protection and other terms and
conditions regarding theft and fraud.
The District could purchase a crime insurance policy that includes coverage for
computer fraud including fund transfers. Staff is completing applications for this
coverage and may recommend its purchase pending a review of pricing, coverage
terms and available policy limits.
Other Electronic Funds at Risk
There are two other sources of District funds exposed to electronic threats; permit fees
paid to the District by customers' credit cards and District procurement cards held by
employees. Permit fee revenue is deposited in our County account and payments for
employee procurement card purchases are made through our running expense fund
with the County. However, the District has some risk of electronic theft at specific points
in these transactions.
There is some risk of loss from the time we swipe a credit card at the permit counter but
before the funds are deposited with the County. Staff has asked our credit card servicer
to provide us with its policy and terms regarding electronic theft for our review.
Procurement cards are subject to theft from the physical loss of a card, theft of account
numbers from the vendors' side, and from online purchases. To date, US Bank has
covered all fraudulent use. As above, staff has asked US Bank, the issuer of District
procurement cards, to provide us with a copy of its theft and fraud policies for our
review.
Losses from both credit card receivables and purchases may be recovered from the
card issuer or servicing agent as well as under a crime policy that includes theft and
electronic fund transfer coverage. Staff will review quotes and coverage options and
make a recommendation as soon as this information is available.
At this time it appears that the District's risks are not significant. However, as noted
above, staff will be evaluating multiple options to further minimize the District's potential
exposure.
If you have any questions or would like any additional information on this issue, please
feel free to contact Shari Deutsch at 229-7320, Debbie Ratcliff at 229-7326 or Randy
Musgraves at 229-7305.
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