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Home My WebLink AboutBUDGET AND FINANCE AGENDA 09-16-13Jl Central Contra Costa Sanitary District SPECIAL MEETING OF THE CENTRAL CONTRA COSTA SANITARY DISTRICT BUDGET AND FINANCE COMMITTEE Chair McGill Member Pilecki (Alternate) Monday, September 16, 2013 3:00 p.m. Middle Conference Room 1470 Executive Drive, Second Floor Concord, California INFORMATION FOR THE PUBLIC ADDRESSING THE COMMITTEE ON AN ITEM ON THE AGENDA BOARD OF DIRECTORS: JAMES A. NEJEDLY President DA V7D R. YVILLIAMS President Pro Tem PA UL H. CA USEY MICHAEL R. MCGILL TAD J. PILECKI PHONE: (925) 228 -9500 FAX.- (925) 676 -7211 www.centralsan.org 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 its 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 Desk, 4849 Imhoff Place, Martinez, and on the District's website at www.centralsan.org. Not every agenda item is accompanied by written supporting material. Reports and 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 Desk. During the meeting, information and supporting materials are available in the meeting room. AMERICANS WITH DISABILITIES ACT In accordance with the Americans With Disabilities Act and state law, it is the policy of the Central Contra Costa 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 participate, please contact the Secretary of the District at least 48 hours in advance of the meeting at (925) 229 -7303. Budget and Finance Committee September 16, 2013 Page 2 Call Meeting to Order 2. Public Comments *3. Receive Six -Month Summary of the Governmental Accounting Standards Board (GASB) 45 /Other Post - Employment Benefits (OPEB) Public Agency Retirement Services (PARS) Trust presentation from Andrew Brown of Highmark Capital Management Staff Recommendation: Receive the presentation and provide input to staff if needed. 4. Receive annual review of PARS GASB 45 /OPEB Trust account by PARS Executive Vice President Mitch Barker Staff Recommendation: Receive the presentation and provide input to staff if needed. *5. Old Business a. Review staff's response to the Committee's request for information regarding the following expenditures at the previous meeting: Check Date Amount Vendor 196395 8115113 $7,344.83 D & L Supply b. Review staff's response to the Committee's request regarding expenditures to Russo Auto Body, reviewed at previous meetings, for more information from Purchasing for sending all auto body work to one vendor within the service area Staff Recommendation: Review staff's responses. Provide direction whether to consider a Local Preference Program or continue with current business practices regarding vendor selections. 6. Risk Management *a. Review Loss Control Report and discuss outstanding claims Staff Recommendation: Review the report, discuss outstanding claims and provide direction if needed. Budget and Finance Committee September 16, 2013 Page 3 7. Expenditures a. Review Expenditures (Item 4.b. in Board Binder) Staff Recommendation: Review and recommend Board approval. *8. Review the District's current Cash Reserve Practices Staff Recommendation: Review and provide input to staff if needed. 9. Announcements 10. Suggestions for future agenda items 11. Adjournment * Attachment q. w G HIGHMARKO CAPITAL MANAGEMENT Investment Guidelines Document Central Contra Costa County Sanitary District GASB 45 / Other Post - Employment Benefits Trust June 2013 Investment Guidelines Document Scope and Purpose The purpose of this Investment Guidelines Document is to: • Facilitate the process of ongoing communication between the Plan Sponsor and its plan fiduciaries; • Confirm the Plan's investment goals and objectives and management policies applicable to the investment portfolio identified below and obtained from the Plan Sponsor; • Provide a framework to construct a well- diversified asset mix that can potentially be expected to meet the account's short- and long -term needs that is consistent with the account's investment objectives, liquidity considerations and risk tolerance; • Identify any unique considerations that may restrict or limit the investment discretion of its designated investment managers; • Help maintain a long -term perspective when market volatility is caused by short -term market movements. • Assist the Plan Sponsor in formulating an Investment Policy Statement ( "IPS ") for the account. Key Plan Sponsor Account Information as of April 22, 2013 Plan Sponsor: Central Contra Costa County Sanitary District Governance: Board of Directors of the Central Contra Costa County Sanitary District Plan Name ( "Plan'): Central Contra Costa County Sanitary District GASB 45 /Other Post - Employment Benefits Trust Trustee: US Bank Contact: Fran Schoenfeld, 949 - 224 -7204 fran.schoenfeid@usbank.com Account Number ( "Account ") :6746030600 Type of Account. GASB 45 /Other Post - Employment Benefits Trust ERISA Status: Not subject to ERISA Market Value of Account. $28,390,075 Investment Manager: US Bank, as discretionary trustee, has delegated investment management responsibilities to HighMark Capital Management, Inc. ( "Investment Manager"), an SEC - registered investment adviser Contact. Andrew Brown, CFA, 415 - 705 -7605 Andrew.brown @ highmarkcapital.com Central Contra Costa County Sanitary District - GASB 45 /Other Post - Employment Benefits Trust Investment Guidelines Document- HighMark Capital Management, Inc. (v 4/26/2013 cis) Investment Authority: Except as otherwise noted, the Trustee, US Bank, has delegated investment authority to HighMark Capital Management, an SEC- registered investment adviser. Investment Manager has full investment discretion over the managed assets in the account. Investment Manager is authorized to purchase, sell, exchange, invest, reinvest and manage the designated assets held in the account, all in accordance with account's investment objectives, without prior approval or subsequent approval of any other party(ies). Investment Obiectives and Constraints The goal of the Plan's investment program is to generate adequate long -term returns that, when combined with contributions, will result in sufficient assets to pay the present and future obligations of the Plan. The following objectives are intended to assist in achieving this goal: • The Plan should earn, on a long -term average basis, a rate of return equal to or in excess of the target rate of return of 6 %. • The Plan should seek to earn a return in excess of its policy benchmark over the long- term. • The Plan's assets will be managed on a total return basis which takes into consideration both investment income and capital appreciation. While the Plan Sponsor recognizes the importance of preservation of capital, it also adheres to the principle that varying degrees of investment risk are generally rewarded with compensating returns. To achieve these objectives, the Plan Sponsor allocates its assets (asset allocation) with a strategic, long- term perspective of the capital markets. Investment Time Horizon: Long -term Anticipated Cash Flows: Approximately $200,000 in monthly contributions. Distributions are expected to be modest in the early years of the Plan. Target Rate of Return: 6% annual target Investment Objective: The primary objective is to maximize total Plan return, subject to the risk and quality constraints set forth herein. The investment objective the Plan Sponsor has selected is the Moderate Objective, which has a dual goal to seek moderate growth of income and principal. Risk Tolerance: Moderate The account's risk tolerance has been rated moderate, which demonstrates that the account can accept average, or moderate, price fluctuations to pursue its investment objectives. Central Contra Costa County Sanitary District — GASB 45 /Other Post - Employment Benefits Trust Investment Guidelines Document HighMark Capital Management. Inc (v. 4/26/2013 cis) 3 Strategic Asset Allocation: The asset allocation ranges for this objective are listed below: Strategic Asset Allocation Ranges Cash Fixed Income Equity 0 -20% 40 % -60% 40 % -60% Policy: 5% Policy: 45% Policy: 50% Market conditions may cause the account's asset allocation to vary from the stated range from time to time. The Investment Manager will rebalance the portfolio no less than quarterly and /or when the actual weighting differs substantially from the strategic range, if appropriate and consistent with your objectives. Security Guidelines: Equities With the exception of limitations and constraints described above, Investment Manager may allocate assets of the equity portion of the account among various market capitalizations (large, mid, small) and investment styles (value, growth). Further, Investment Manager may allocate assets among domestic, international developed and emerging market equity securities. Total Equities 40 % -60% Equity Style Range Domestic Large Cap Equity 15 % -45% Domestic Mid Cap Equity 0 % -10% Domestic Small Cap Equity 0 % -15% International Equity (incl Emerging Markets) 0 % -15% Real Estate Investment Trust (REIT) 0 % -15% Fixed Income In the fixed income portion of the account, Investment Manager may allocate assets among various sectors and industries, as well as varying maturities and credit quality that are consistent with the overall goals and objectives of the portfolio. Total Fixed Income 40 % -60% Fixed Income Style Range Long -term bonds (maturities >7 years) 0 % -25% Intermediate -term bonds (maturities 3 -7 years) 25 % -60% Short -Term bonds (maturities <3 ears) 0 % -25% High Yield bonds 0 % -10% Convertible bonds 0 % -10% Central Contra Costa County Sanitary District GASB 45 /Other Post - Employment Benefits Trust Investment Guidelines Document - HighMark Capital Management, Inc (v. 4/26/2013 - cls) J Performance Benchmarks: The performance of the total Plan shall be measured over a three and five -year periods. These periods are considered sufficient to accommodate the market cycles experienced with investments. The performance shall be compared to the return of the total portfolio blended benchmark shown below. Total Portfolio Blended Benchmark 26.50% S &P500 5.00% Russell Mid Cap 7.50% Russell 2000 3.25% MSCI EM FREE 6.00% MSCI EAFE 1.75% Wilshire REIT 33.50% BC US Aggregate 10.00% ML 1 -3 Year US Corp /Gov't 1.50% US High Yield Master II 5.00% Citi 1 Mth T -Bill Asset Class /Style Benchmarks Over a market cycle, the long -term objective for each investment strategy is to add value to a market benchmark. The following are the benchmarks used to monitor each investment strategy: Large Cap Equity S &P 500 Mid Cap Equity Russell MidCap Index Growth Russell MidCap Growth Value Russell MidCap Value Small Cap Equity Russell 2000 Index Growth Russell 2000 Growth Value Russell 2000 Value REITs Wilshire REIT International Equity MSCI EAFE Investment Grade Bonds BarCap US Aggregate Bond High Yield Credit Suisse High Yield Security Selection Investment Manager may utilize a full range of investment vehicles when constructing the investment portfolio, including but not limited to individual securities, mutual funds, and exchange traded funds. In addition, to the extent permissible, Investment Manager is authorized to invest in shares of mutual funds in which the Investment Manager serves as advisor or subadviser. Central Contra Costa County Sanitary District - GASB 45 /Other Post Employment Benefits Trust Investment Guidelines Document HighMark Capital Management Inc. (v 4/26/2013 - cis) 5 Investment Limitations: The following investment transactions are prohibited: • Direct investments in precious metals (precious metals mutual funds and exchange- traded funds are permissible). • Venture Capital • Short sales* • Purchases of Letter Stock, Private Placements, or direct payments • Leveraged Transactions* • Commodities Transactions Puts, calls, straddles, or other option strategies* • Purchases of real estate, with the exception of REITs • Derivatives, with exception of ETFs* *Permissible in diversified mutual funds and exchange- traded funds Duties and Resmnsibilities Responsibilities of Plan Sponsor The Finance Committee of the Central Contra Costa Sanitary District is responsible for: • Confirming the accuracy of this Investment Guidelines Document, in writing. • Advising Trustee and Investment Manager of any change in the plan /account's financial situation, funding status, or cash flows, which could possibly necessitate a change to the account's overall risk tolerance, time horizon or liquidity requirements; and thus would dictate a change to the overall investment objective and goals for the account. • Providing Trustee and Investment Manager with an approved IPS for the account and providing any updates to the IPS. • Monitoring and supervising all service vendors and investment options, including investment managers. ® Avoiding prohibited transactions and conflicts of interest. Responsibilities of Trustee The plan Trustee is responsible for: ■ Valuing the holdings ■ Collecting all income and dividends owed to the Plan. ■ Settling all transactions (buy -sell orders). Responsibilities of Investment Manager The Investment Manager is responsible for: • Assisting the Finance Committee with the development and maintenance of this Investment Policy Guideline document annually. • Meeting with Finance Committee semi-annually to review portfolio structure, holdings, and performance. • Designing, recommending and implementing an appropriate asset allocation consistent with the investment objectives, time horizon, risk profile, guidelines and constraints outlined in this statement. ■ Researching and monitoring investment advisers and investment vehicles. • Purchasing, selling, and reinvesting in securities held in the account. ■ Monitoring the performance of all selected assets. Central Contra Costa County Sanitary District - GASB 45 /Other Post Employment Benefits Trust Investment Guidelines Document - HighMark Capital Management, Inc (v 4/26/2013 cis) 6 ■ Voting proxies, if applicable. • Recommending changes to any of the above. ■ Periodically reviewing the suitability of the investments, being available to meet with the committee at least once each year, and being available at such other times within reason at your request. ■ Preparing and presenting appropriate reports. ■ Informing the committee if changes occur in personnel that are responsible for portfolio management or research. Acknowledgement and Acceptance I/We being the Plan Sponsor with responsibility for the account(s) held on behalf of the Plan Sponsor specified below, designate Investment Manager as having the investment discretion and management responsibility indicated in relation to all assets of the Plan or specified Account. If such designation is set forth in the Plan /trust, I/We hereby confirm such designation as Investment Manager. 1 have read the Investment Guidelines Document, and confirm the accuracy of it, including the terms and conditions under which the assets in this account are to be held, managed, and disposed of by Investment Manager. This Investment Guidelines Document supersedes all previous versions of an Investment Guidelines Document or investment objective instructions that may have been executed for this account. Date: Plan Sponsor: Central Contra County Sanitary District Date: Plan Sponsor: Central Contra County Sanitary District — -- - -- - — Date- Investment Manager: Andrew Brown, CFA, Senior Portfolio Manager, (415) 705 -7605 Central Contra Costa County Sanitary District — GASB 45 /Other Post - Employment Benefits Trust Investment Guidelines Document HighMark Capital Management Inc. (v 4/26/2013 - cis) d �o .e ooe y y Oo0'),NN.u�O y= C 0 0 0 0 0 LL E'La co m 0 8000 a) F S O p O O O p 0 00 F -1 0 0 0 0 y w 0 0 C. 0 D 0 /Cd O 69 Y j �. N t� 0 0 0 0 = LL `. 000 69.000 LL 0 0 0 0 Cl O O 0 0 69 Vi 609 d W e e e o 0 C O O O O O Q 0000 y O19 p ~ 0 co, co, co LL u1q�C5 m a a 0000 0 0 0 0 0 0 wi U9 0O Lo 0 fA U; V2 Z W w cr D 0 y d C N O t0 E2 3 1C1 y O) fA a Nw �oosoa O 04 O tl7O y y m NaoMq c 7 M N O LL LL C C C 0 O C E LY Q LO O O O C cm O O O O N a :f G 91 ' 0 0 0 O y 0 0 0 0 0 m� arc' Cry C 69 69 69 fa .3 W t N E 0 0 0 00 =4 efAO S 00 U-1 0 0 0 0 'j O LO to �M Vi fA N I ale e e ;e 0 0 0 0 0 1p NN ap M O) 7NN e-O ° 0 0 0 0 Q 0000... Q 0 0 0 N 0 0 0 0 O m g 0 0 0 C LL GO � t2 0 N � i�69609 a a W Z r 0000 da, ' 000 O O O O 00 Vi 69 69 � O 2 T L t0 C n co N O � � Q a R 0 0 0 co 0 C C, co CO Cp S r. N O O g O Q O O L O W 0 0 0 S O ro 7 0 tl') O C 0 Q N N' M 0 Q o p a 0 0 0 N N O O O O O opaa0U? 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O 0 t(7 If1 � N m 5 m v fn L N > N 0) a0 m aD LL O 'J m y 0 N LQ to w C N Q N 7 O C) y_ 15 J p Fco 0 � N a0 (O CO IS %d Z 5. Central Contra Costa Sanitary District September 16, 2013 TO: BUDGET AND FINANCE COMMITTEE FROM: THEA VASSALLO, FINANCE MANAGER9%6 VIA: ROGER BAILEY, GENERAL MANAGER SUBJECT: EXPENDITURE FOLLOW -UP At the September 3, 2013 Budget and Finance Committee meeting, staff was asked to provide additional information on the following: Check Date Amount Vendor 196395 8/15/13 $7,344.83 D & L Supply How many manholes were ordered and why? Does the District order in lots? For normal stock or replacement project in process? 196182 7/25/13 $ 4,384.35 Russo Auto Body V #200 196278 8/01/13 4,203.00 Russo Auto Body V #201 196278 8/01/13 783.49 Russo Auto Body V #223 Provide more information from Purchasing for sending all auto body work to one vendor within the service area. D & L Supply Per Senior Materials Coordinator Greg Ziegler, the D & L Supply invoices included two orders. The first invoice is for an order of 25 rodding frame and covers needed for the Collection System Operations (CSO) yard. These are the small 15" rodding inlets. It is normal for Maintenance Crew Leader Mark Goss to ask for manhole frames and covers for upcoming jobs. CSO normally keeps 10 to 20 in the yard. When construction jobs are forthcoming, the District buys accordingly. The District uses more during the summer, and the usage drops off during the winter. The second invoice was requested by Environmental Compliance Superintendent Tim Potter for a job at St. Mary's College. The lids ordered for this job were manhole covers without "CCCSD" casted on them (marked "Sanitary Sewer "). The normal covers used throughout the District have "CCCSD" casted on them. Mr. Potter had a special job occurring at the college. Expenditure Follow Up Central Contra Costa Sanitary District Page 2 of 6 Additional information provided by Mr. Zeigler on manhole purchases • He has not heard of any disappearing manhole covers in the streets. He purchases manhole castings and covers, and rodding inlets from D & L Supply on an average of every 2 to 3 months, depending on construction needs. • The District does not receive a lot or quantity discount from D & L Supply. Mr. Zeigler has previously asked, and they have said they do not provide lot discounts. Per Environmental Compliance Superintendent Tim Potter, this order is one in a series of orders. The project objective is to replace manhole covers at facilities operating under a Source Control Permit that have "CCCSD" covers with generic "Sanitary Sewer" covers. Until the 1990's, the District's Standard Specifications required "CCCSD" manhole covers to be used in private systems. During a response to an overflow condition from a manhole structure on the Kaiser facility in Walnut Creek in 2007, there was some confusion on the part of Kaiser staff when they observed "CCCSD" on the manhole. It was decided that the District would undertake a project to replace the "CCCSD" manhole covers on the structures at facilities that have been issued a Source Control Permit. Several larger facilities with larger private systems have been prioritized. The process is to replace the "CCCSD" covers at the District's expense, since the facility was following the Standard Specifications when the covers were first installed, and then CSO stockpiles the replaced "CCCSD" covers at their yard and works them into their projects. The pace for the replacement is influenced by the ability of CSO to use up the stock of covers generated from a replacement event. St. Mary's College is the next facility slated for the replacement. Attached are copies of the invoices for your review. Russo's Auto Body (additional information obtained from Purchasing and Fleet Management) Purchasing requirements for setting up an annual contract for auto body work Per Purchasing and Materials Manager Stephanie King, Purchasing can set up a contract with one vendor for auto body work by employing a competitive process and awarding to the lowest bidder. Since auto body work, in most cases, cannot be pre- defined, staff would need to bid this out based on time and materials. The District invites and encourages local business participation in its competitive processes; however, the District does not exclude other businesses that are out of its service area. The District also does not give any preference points towards local businesses, since it does not currently have a policy in place for local preferences. The award is let to the lowest bidder. Setting up a time and materials annual contract with one vendor is an option for future auto body work; however, some of the local companies may not be eligible due to their inability to accommodate the District's larger trucks. Other than Russo Auto Body, the next closest auto body shop that the District is aware of that can accommodate the larger trucks is out of Oakland. Therefore, setting up one vendor for Expenditure Follow Up Central Contra Costa Sanitary District Page 3 of 6 all auto body work could result in less opportunity for the local companies to do business with the District. The other option is to continue getting quotes on an as- needed basis, as explained below. Currently, the District receives multiple quotes based on its immediate needs for auto body work. The auto body vendors submit lump sum quotes. Recently, there have been multiple requests, due to vehicles needing paint jobs as opposed to replacing them. However, staff has stated that the need for auto body work is usually infrequent and unpredictable. When services are needed infrequently, it is common practice for the District to receive quotes on an as- needed basis as opposed to doing a solicitation to set up an annual contract. This practice helps the District receive current and competitive pricing. Also, a lump sum price lowers the District's risk in terms of cost, whereas the District is at greater risk and uncertainty of total cost with a time and materials price. Given this information, Purchasing feels it would be most advantageous for the District to continue doing business as it has, unless it finds that the amount of auto body work increases enough to warrant setting up an annual contract. Doinq business with companies within the District's service area Currently, the District includes and encourages local businesses to participate in its solicitations. The District does not have a policy in place to give preference to local businesses. if the Board would like to consider a local vendor preference policy, staff can bring some options and recommendations back at later date. Many public agencies have local preference policies, although it seems to be more prevalent in cities and counties. In addition, when considering local preference policies, many agencies consider outreach efforts to other types of businesses as well, such as disabled veterans businesses, small businesses, minority -owned businesses, women -owned businesses, etc. There are limitations on how and when local bid preferences may be implemented. These limitations stem, in large part, from other laws meant to make sure government gets the best deal it can on contracts, to help avoid favoritism in government contracting, and to comply with the Commerce Clause of the U.S. Constitution, which is interpreted to forbid most restraints on open and free commerce. Therefore, legal review and input of any proposed policy will be required. In general, there are a few different types of Local Preference Programs: • Tie -bids - when the bid of a local bidder is the same amount of that of a non -local bid; preference goes to the local bidder • Match /Percentage bids - when the local bidder's bid is within a certain percentage of that of the lowest bid by a non -local bidder; the local bidder may be awarded the bid; or the local bidder is given the opportunity to match the non - local bidder's price. • Absolute - requires jurisdiction to purchase certain commodities within designated area Expenditure Follow Up Central Contra Costa Sanitary District Page 4 of 6 Pros of a Local Preference Program: • Increases economic activity in jurisdiction • Higher level of employment • Stimulates local economy by keeping expenditure of tax dollars in the locality • Benefits local vendors by giving an advantage in the bid process • May eliminate non -local bidders who do not have local area knowledge and subcontractor contacts Cons of a Local Preference Program: • Violates basic principles of public purchasing: equity, impartiality, open competition and the least cost to the taxpayer • Causes an efficiency loss as purchasers switch to inefficient local producers • Discourages competition and reduces the pool of competing bidders • Higher fees may be paid to local firms when a local preference is in place • Incurs additional staff time to administer program (validate whether companies meet the criteria to qualify as "local," analysis of bids, resolution of the winning bidder is more complex) • Increased bid protests based on real or perceived legality concerns • Definition and application of "local" is subject to interpretation and possible legal challenge • Could hinder cooperative purchasing opportunities with other jurisdictions; thereby decreasing advantage pricing due to economies of scale Other considerations: • Federal government policy prohibits local procurement preferences for the expenditure of federal grant funds • Purchasing staff at many public agencies apply local preference policies and they note that the application of such a policy produces minimal changes in the outcome of awards Fleet Management Per Field Operations Superintendent Don Rhoads, the vehicle shop has been getting competitive quotes from multiple vendors for each job. Consistently, Russo has been the lowest quote and provides excellent service. The following are some of the extras they provide. • Onsite Quotes - Russo's is the only vendor who comes to the CSO facility to do the quote for the work. Staff has to take the unit to all the other vendors for such q u otes. Drop off assistance - Russo's provides a ride back to CSO to the District's driver when after dropping off the vehicle for repairs. They also have a local representative who lives nearby, so the District can often coordinate return trips to pick up the vehicle. Expenditure Follow Up Central Contra Costa Sanitary District Page 5 of 6 C Large Truck Booth - Russo's is one of only a few vendors in the Bay Area with a booth large enough to perform work on our larger trucks. Only Golden Gate in Oakland and one other in San Leandro have similar setups. Per Mr. Rhoads, Russo's has demonstrated they have the best pricing, perform excellent work, minimize staff time, and can perform their services on any of the vehicles. They would be the best choice with whom to enter into a long term contract to perform vehicle painting services. If the Board decides that it wants to continue to obtain competitive quotes, staff would be more than glad to continue do so, but Mr. Rhoads believes the District should continue to use Russo's if they have the lowest quote. Staff is asking for direction from the Committee on whether or not to continue the current business practice or consider a Local Preference Program. Russo's Auto Body (Information provided at 9/3/13 Committee meeting) The first two invoices for Russo's Auto Body in the amount of $4,384.35 and $4,203.00 were for preparation and paint on two of the District's 2002 Ford vans (Vehicles 200 and 201). The paint was flaking in several areas on both units. Per discussion with Field Operations Superintendent Don Rhoads, the two vans were in good shape, had low mileage, but it appeared that that model /year had bad paint jobs. It was determined that it would be cheaper to paint the vans than replace them. Per Mr. Rhoads, Russo's Auto Body provides quality work for a reasonable price, and bids are not shared with other vendors. Vehicle & Equipment Maintenance Supervisor Nick Wright requested and received quotes from the following: Vehicle 201 was estimated by 4 different auto body shops Jim's Auto Body in Concord quoted $7,036.91 Mike Rose Auto Body, Inc. quoted $6,142.17 Lafayette Auto Body quoted $4,220.21 Russo Auto Body quoted $4,203.00 Vehicle 200 was quoted by the 2 lowest vendors Lafayette Auto Body quoted $4,668.48 Russo Auto Body quoted $4,384.35 Per Mr. Wright, combining the requisitions on one purchase order seemed like a more reasonable thing to do since identical material and work could be combined. It would also minimize downtime for staff. The total for the two van repaints was $8,587.35. The third Russo Auto Body invoice in the amount of $783.49 was for repainting the hood on Vehicle 223, one of three 2004 Chevy pickup trucks. Vehicles 223, 224, and 225 had paint issues on the hood. Purchase Order 040710 for three Chevy hoods was quoted by Russo Auto Body for $783.49 per hood, for a total of $2,350.47. This pricing Expenditure Follow Up Central Contra Costa Sanitary District Page 6 of 6 was below the purchasing policies' competitive pricing requirement and was done on 7/9/13. After further discussion with Safety and Risk Management Administrator Shari Deutsch, the District does in fact use other businesses in addition to Russo Auto Body and are as follows: GG Truck Center, Concord Auto Body, Miracle Auto Body, Mike Rose's Auto Body, Jim's Auto Body, Miracle Auto Painting, and Western Truck Fab. Soppt/, loo. Invoice Page: 1 -Tae MDA Near Pack List No: 0000019978 CENTRAL CONTRA COSTA SAN CENTRAL CONTRA COSTA SAN 5019 IMHOFF PLACE 5019 IMHOFF PLACE MARTINEZ, CA 94553 USA MARTINEZ, CA 94553 USA 040764 OT H- 8026 -12 CA C- XH,CCCSD 16 I /2C,EP,BP H- 8026 -R1 CA RING -FLUSH IN, 15 CO, 5H TudVh r 14 Msa 94, CENTRAL CONTRA COSTA I_ACaM NUMBER L AMOUNT 7)n/_ nn 7),n A 1,- mss —1 Cci } - ,.,- Contact: CENTRAL CONTRAEOSTA SAN Terms and Conditions of Sale Quantity variations must be reported within 5 days of receipt of material. All other claims and returns must be accompanied by an invoice within 30 days. All returns are subject to a re- stocking fee. PVRC/U15ER HEREBY ACNNOWLEDGE8 RECEIPT OF ABOVE MERCHANDISE AS BEU 0 COMPLETE A A AND -N 0000 ORDER AND 3 SLBJECT TO THE TERMS AND CONDITIONS SET FORTH BELOW AND ON THE FACE HEREOF T•ERE ARE NO TERMS OR CONOITION9 VERBAL OR OTHERWLBE RELAT. :NO TO THE GOODS ORDERED HEREBY WHICH ARE NOT CONTAINED HEREIN. Lindon 1 %10 Met 30 25 / 52.00 25 92.30 Subtotal Shipping & Handling Sales Tar Trade Discount Payment/Credit Amount 1,300.00 2,307.50 3,607.50 0.00 306.65 0.00 0.00 3.914.15 — —_ --- __J SIGNATURE OF AU HORIZED PURCHASER PL RCHASER AGREES TO PAY 'HE PRICE ESTIMATED ON THE FACE HEREOF TO'ELLER AT L NOON. UTAH ADDITIONALCGSTS NCURRED WILL BE ADDED TO AND PAID AT PART OF THE SELLING PRICE IN ADDITION TO THE PRICE SHOWN ON FACE HEREOF PURCHASER AGREES TO PAY ALL STATE FEDERAL D SL L SUPPLY ASSUMES NO LABILITY FOR MATERIALS COUNTY AND C: TY TAXES NOW N EFT ECT OR HEREAFTI R MP09 ED UPON RECE PT OF GOODS ORDERED w( RE, INDER 'F 1, i PURCHASE PRICE A ANY PARTTHEREOF'S NOT PAID BY PURCHASER TO SELLER WHEN.IUE. PURCHASER SHALL PAY REASONABLE COLLECTORS ANDIOR ATTORNEYS FEES (WHETHER OR NOT LEGAL ACTION BE HSTITUITED)ANOALLOF SEL.ERS COLLECTION COATS AND EXPENSES NCLLOING COURT COSTS FLEGALACTION NOT INSTALLED PROPERLY BY 'URCHASER 1F COMMENCED A' ERVICE CHARGE OFT PER MONTH (NT, ANNUAL PERCENTAI.E RATE) ON THE I. NPAO BALANCE SHALL BC CHARGED ON ANY BAL I ANCE HOT PAID YA T'III..DAY. I �CXHOWLEOGETHESE'ERMS AN0 CONDITIONS BY MY S GNATURE Invoice No.: 0000018171 D &L Supply Company Inc. PO Box 580 I " Invoice Date: 8/9/2013 ustomer No.: CA -CEN 100 Orem, UT 84059 Phone: 801 - 785 -5015 Branch: CA Fax: 801- 785 -0835 Admin. Services Salesperson:: Toll Free Phone: 800 - 453 -9802 Our Order No: SO -C 1283 Pack List No: 0000019978 CENTRAL CONTRA COSTA SAN CENTRAL CONTRA COSTA SAN 5019 IMHOFF PLACE 5019 IMHOFF PLACE MARTINEZ, CA 94553 USA MARTINEZ, CA 94553 USA 040764 OT H- 8026 -12 CA C- XH,CCCSD 16 I /2C,EP,BP H- 8026 -R1 CA RING -FLUSH IN, 15 CO, 5H TudVh r 14 Msa 94, CENTRAL CONTRA COSTA I_ACaM NUMBER L AMOUNT 7)n/_ nn 7),n A 1,- mss —1 Cci } - ,.,- Contact: CENTRAL CONTRAEOSTA SAN Terms and Conditions of Sale Quantity variations must be reported within 5 days of receipt of material. All other claims and returns must be accompanied by an invoice within 30 days. All returns are subject to a re- stocking fee. PVRC/U15ER HEREBY ACNNOWLEDGE8 RECEIPT OF ABOVE MERCHANDISE AS BEU 0 COMPLETE A A AND -N 0000 ORDER AND 3 SLBJECT TO THE TERMS AND CONDITIONS SET FORTH BELOW AND ON THE FACE HEREOF T•ERE ARE NO TERMS OR CONOITION9 VERBAL OR OTHERWLBE RELAT. :NO TO THE GOODS ORDERED HEREBY WHICH ARE NOT CONTAINED HEREIN. Lindon 1 %10 Met 30 25 / 52.00 25 92.30 Subtotal Shipping & Handling Sales Tar Trade Discount Payment/Credit Amount 1,300.00 2,307.50 3,607.50 0.00 306.65 0.00 0.00 3.914.15 — —_ --- __J SIGNATURE OF AU HORIZED PURCHASER PL RCHASER AGREES TO PAY 'HE PRICE ESTIMATED ON THE FACE HEREOF TO'ELLER AT L NOON. UTAH ADDITIONALCGSTS NCURRED WILL BE ADDED TO AND PAID AT PART OF THE SELLING PRICE IN ADDITION TO THE PRICE SHOWN ON FACE HEREOF PURCHASER AGREES TO PAY ALL STATE FEDERAL D SL L SUPPLY ASSUMES NO LABILITY FOR MATERIALS COUNTY AND C: TY TAXES NOW N EFT ECT OR HEREAFTI R MP09 ED UPON RECE PT OF GOODS ORDERED w( RE, INDER 'F 1, i PURCHASE PRICE A ANY PARTTHEREOF'S NOT PAID BY PURCHASER TO SELLER WHEN.IUE. PURCHASER SHALL PAY REASONABLE COLLECTORS ANDIOR ATTORNEYS FEES (WHETHER OR NOT LEGAL ACTION BE HSTITUITED)ANOALLOF SEL.ERS COLLECTION COATS AND EXPENSES NCLLOING COURT COSTS FLEGALACTION NOT INSTALLED PROPERLY BY 'URCHASER 1F COMMENCED A' ERVICE CHARGE OFT PER MONTH (NT, ANNUAL PERCENTAI.E RATE) ON THE I. NPAO BALANCE SHALL BC CHARGED ON ANY BAL I ANCE HOT PAID YA T'III..DAY. I �CXHOWLEOGETHESE'ERMS AN0 CONDITIONS BY MY S GNATURE PI310IO3 Central Contra Costa Sanitary District 9/04/13 P.O. 040764 Purchase Order Inquiry 14:42:32 Type option, press Enter. 1 =Item detail 2= Receipt History Position to line: Opt Line Quantity UOM Item Number Unit Cost Ext Cost Tax _ 001 25.00 EA 059 004 00001 52.0000 1300.00 S COVER RODDING INLET Ref nbr 1756 COVERboRODDI� INLET MARKED "CCCSD" _ 002 25.00 EA 143 004 00002 92.3000 2307.50 S MANHOLE FRAME Ref nbr 1778 FRAME, RODDING INLET FLUSH INLET 15" CO 0000 - / 07 - UO- 0 0 _ 003 25.00 EA 903 000 153.5000 3837.50 S COLLECTION SYSTEM DEPT. COLLECTION SYSTEM DEPT. Ref nbr 28" MANHOLE COVER W /CCCSD FOR MARK GOSS �3/0-5'ic Sub tot: 7445.00 Discount: Tax: 632.83 Total: 8077.83 Sales tax total : 632.83 Addt'1 tax total : F3 =Exit F7 =Item description F11 =Next PO F12= Cancel F16 =Rec /Inv Comments F18= Receipt Inquiry pMS600, Invoice Page. Cu�ttttitcr P'Cl, Shi•i Vi;i F.0.13 lerm� 416 OT Lindon 1 Net 30 Il�n� "''' ll'arehnu;c Dce'Criptioil Qty Shi'ncl 'ZV A- 1024 -01 CA C- XH,SAS, EP, BP, 25 5/16 H- 8026 -05 CA C -XHSAN SWR16 1 /2C, EP,BP CENTRAL CONTRA- COIq Y. - ACCOUVTIvUb'BER 0 L &IRE L /Lt/J/J Inc E uvS AT t � ST P . JV�� / Contact- CENTRAL CONTRA COSTA SAN Terms and Coirditlons of Sale Quantity variations must be reported within 5 days of receipt of material. All other claims and returns must be accompanied by an invoice within 30 days. All returns are subject to a re- stocking fee. 30 101.40 3 52.00 Subtotal Shipping & Handling Sales Tax Trade Discount Payment/Credit Amount NUNASEN HEREBY ACRNOWl ME5 RECEIPT OF ABOVE MERCHANDISE AS BEING COMPLETE AND IN GOOD ORDER AND IS SUBJECT TO THE TEAMS AND CONDITIONS SET FORTH BELOW AND �/ ON THE FACE HEREOF THERE ARE NO TERMS OR CONDITIONS VERBAL OR OTHERWISE RELAY /i` ING TO THE GOODS ORDERED HEREBY WHICH ARE NOT CONTAINED HEREIN SIGNATURE OF AUTHORIZED PURCHASER 3,042.00 156.00 3,198.0( 0.0C 271.83 0.0C 0.0C 3.469.83 PURCHASER AGREES TO PAY THE PRICE ES I IMAED ON THE FACE HERE OF '0 SE.LER AT .INOON u'AH ADDITIONAL COSTS INCURRED WE, BE ADDED CPD L FFEI HEREOF PURCHASER STATE, �` OUNTYANCT' TAKES NOW NEFEC' OR HEREAFTER MPOS EDPON REC"OFCOOD ORDERED HEREUNDER THE PURCHASEPRICE D D & L SUPPLY ASSUMES NO LIABILITY FOR MATERIALS THEREOF T E NE DUE S C REASONABLE `° IDNAa° A(WHE ER OR NO LEGAL PURCHASER D)ANDAL.OFRCO LETIDONCOSTSANDXPE Es NCLUIGGaTCO TSILEGALLCTIc. NOT INSTALLED PROPERLY BY PURCHASER AF COMMENCE 0 A SER- ECHARGE OF? PER MDIITNI)AIL ANM.A PFR�eu,Arcn.,e. nu Luc .ue. ,n. c.ve eu.•. ee�u.a.n....wv. Invoice No.. 0000017179 �. D &L Supply Company Inc. PO Box 580 --� Invoice Date: -' 7/11/2013 Orem, UT 84059 I _ Customer No.: ranc Bh: CA -CEN 100 CA t` Phone: 801 - 785 -5015 Fax: 801- 785 -0835 Sales erson: C i � - P -Fhe&4 .,.� Toll Free Phone: 800- 453 -98 2 JUL ' Our Order No: SO- 0000015670 ,�ci1-nin. Services Pack List No: 0000018761 GL' NTRAL CONTRA COSTA SAN �._ CENTRAL CONTRA COSTA SAN 5019 IMHOFF PLACE ;' 1250 Sprigbrook Road MARTI.,T' Z. CA 94553 USA _ Walnut Creek, CA 94597 USA Cu�ttttitcr P'Cl, Shi•i Vi;i F.0.13 lerm� 416 OT Lindon 1 Net 30 Il�n� "''' ll'arehnu;c Dce'Criptioil Qty Shi'ncl 'ZV A- 1024 -01 CA C- XH,SAS, EP, BP, 25 5/16 H- 8026 -05 CA C -XHSAN SWR16 1 /2C, EP,BP CENTRAL CONTRA- COIq Y. - ACCOUVTIvUb'BER 0 L &IRE L /Lt/J/J Inc E uvS AT t � ST P . JV�� / Contact- CENTRAL CONTRA COSTA SAN Terms and Coirditlons of Sale Quantity variations must be reported within 5 days of receipt of material. All other claims and returns must be accompanied by an invoice within 30 days. All returns are subject to a re- stocking fee. 30 101.40 3 52.00 Subtotal Shipping & Handling Sales Tax Trade Discount Payment/Credit Amount NUNASEN HEREBY ACRNOWl ME5 RECEIPT OF ABOVE MERCHANDISE AS BEING COMPLETE AND IN GOOD ORDER AND IS SUBJECT TO THE TEAMS AND CONDITIONS SET FORTH BELOW AND �/ ON THE FACE HEREOF THERE ARE NO TERMS OR CONDITIONS VERBAL OR OTHERWISE RELAY /i` ING TO THE GOODS ORDERED HEREBY WHICH ARE NOT CONTAINED HEREIN SIGNATURE OF AUTHORIZED PURCHASER 3,042.00 156.00 3,198.0( 0.0C 271.83 0.0C 0.0C 3.469.83 PURCHASER AGREES TO PAY THE PRICE ES I IMAED ON THE FACE HERE OF '0 SE.LER AT .INOON u'AH ADDITIONAL COSTS INCURRED WE, BE ADDED CPD L FFEI HEREOF PURCHASER STATE, �` OUNTYANCT' TAKES NOW NEFEC' OR HEREAFTER MPOS EDPON REC"OFCOOD ORDERED HEREUNDER THE PURCHASEPRICE D D & L SUPPLY ASSUMES NO LIABILITY FOR MATERIALS THEREOF T E NE DUE S C REASONABLE `° IDNAa° A(WHE ER OR NO LEGAL PURCHASER D)ANDAL.OFRCO LETIDONCOSTSANDXPE Es NCLUIGGaTCO TSILEGALLCTIc. NOT INSTALLED PROPERLY BY PURCHASER AF COMMENCE 0 A SER- ECHARGE OF? PER MDIITNI)AIL ANM.A PFR�eu,Arcn.,e. nu Luc .ue. ,n. c.ve eu.•. ee�u.a.n....wv. PI625102 Central Contra Costa Sanitary District 8/14/13 Purchase Pequisition 11:03:58 Number . . . . . . . 0000041434 Type . . . . . . . . 1 PURCHASE REQUISITION Status . . . . . . . ALL ITEMS ON ORDER Reason . . . . . . . REPLACEMENT OF "CCCSD" LIDS WITH "SANITARY SEWER" By . . . . . . . . . LIDS AT ST MARYS COLLEGE Date . . . . . . . . 4/11/13 Vendor . . . . . . . 8203 D & L SUPPLY Contract nbr . . . . . Ship to . . . . . . . WC WALNUT CREEK Deliver by date . . . 6/01/13 Buyer . . . . . . . . AH ANTHONY HOLT Fiscal year code . . C C= Current year, P= Previous year, F= Future year Type options, press Enter. 5= Display 8 =Item extended description Opt Line# Quantity UOM Description _ 1 30.00 EA STANDARD MANHOLE LID 2 3.00 EA STANDARD RODDING INLET LIDS Total: 3198.00 F3 =Exit F7= Alternate view F9 =Print F10= Approval info F12= Cancel F20= Comments Highlight indicates item has been processed or deleted. t y O a C o� E cc O d C [NO d O U co I W O E O CIS E J O C'3 T tCO M T C � a) N _0 0 U C (� Cf1U �U<n a> U �� c> t0 � co � U °> CD cn U) .0 LZ S Z W e c D O 0) N 0) IL J OD tC ' O Cl) Oo Lo m r a ca c�D N _2 W N g �y v 60), GR3 fA C) CD d m Z N m CD to _ N O C O = . CD _ :D J d , C U O C Ld t- M N a Z O C) (n N Q3j z O LL CL cc CD o LLI 0O IL 3 69 EA EA O O a a> W 0 O a l0 IL a> d N d cc U y y d .p Q r ai a a`> L O J O Q ft U) �o N y C E O d Gi [NO d co I O E U CIS E O C'3 O tCO a) O [n 41 R d (� Cf1U �U<n a> a c> t0 � co � O CD cn e T D -cr 0) O m OD tC ' O Cl) Oo Lo r a ca c�D N N g �y v 60), GR3 fA U3) FA CD d m CS N C� gn CD to N O C Lfn O° L°n CD y , a) Ld t- M N E M cf ao N CL CD o 0O IL 3 69 EA EA (A m _cc U ® v � > a' `'O c V l0 J t O E v m c To m o y J Q a F C y i p -0 O G a> Uc m W o J J J tO N 7 C O y � J N � y r 0 =3 i c.� y N O Q co m D_ c W LO LO M r M lA Q �2 > � ca O 7 a 3 C a E c cu M a w m` a. h as L C 4) La C d N U t `m e M r = M J N J O r N LL d W Q r N � � CM C*) C 2 M J t- ®" N N O 0 0 N 1- J r CD a a C W r g W U ~ C* Z Ora N y a1 W h � >- O CL JH� 0 co 1�- r L) `f cc Z H W— M W C c O 'O� VO T � C3 M FL a cn r N N N N Z N OD N M YX N U) 0 0- M Q w cr y E d O O C'3 O tCO IL J d (� a> c> t0 Ln LO cn e -cr tC a ca CD g ° CD CD CS N C� gn CD to N O C CD a) Ld L C CL ® o 0O IL 3 U ® H > O H !O y ot C y i p -0 O T Z Q W o J J r c.� c a 3 a E c o m` a. h as L C L M r M J N J O r N � r N � � a r (n J t- ®" J f- Q 1- W r g U ~ C* Z N W N >- 0 1�- r L) `f cc Z W— O c O R H FL a cn Q O Central Contra Costa Sanitary District Financial Reserve (Funds Required) Guidelines The purpose of the Central Contra Costa Sanitary District's (The District) Funds Required Guidelines is to ensure that the District will have sufficient liquid cash and investments available to meet its operating, capital, self - insurance, and debt service obligations. This guideline establishes a minimum amount required in cash and investments to cover total District cash flow needs throughout the year without borrowing funds. This minimum requirement provides a sufficient level of cash and investments for long -term financial planning and for maintaining the District's long -term financial health and stability. Cash Flow Guidelines and Definitions Funds Required is the amount of money held in cash and investments that is needed at June 30th of any fiscal year to meet our cash flow needs through mid - December, when we receive our first sewer service charge (SSC) and property tax payment from Contra Costa County (CCC). A cash flow analysis is prepared each year during the 10 -year planning process to determine an appropriate level of rate and fee adjustments. Staff will recommend rate and fee adjustments with a goal of maintaining our minimum Funds Required threshold. Funds are needed to pay our bills between mid -April and mid- December while we wait for our SSC and property tax installment to be deposited into our account by CCC. We have other smaller revenue sources each month that help offset expense allowing for the requirement to be less than the full eight -month period; however, the County installment is our largest revenue source. The amount of cash required from June 30th (the end of the fiscal year) until mid- December is 5Y2 months. The amount currently needed to be set aside is approximately 30 -32% of the next year's budgeted O &M and Capital expenses, plus 100% of debt service. in addition, approximately $4 million is set aside in the Self - insurance Fund. Events or Conditions that Prompt the Use of Cash Funds Required Cash Funds Required supply adequate cash flow to avoid short-term borrowing and to provide for unplanned or unforeseen events. Also, adequate cash Funds Required provide working capital to help stabilize rates and are a component of achieving favorable credit ratings that can help to minimize costs of issuing future debt. The cash Funds Required earn interest and provide a financial cushion for dealing with unanticipated financial needs such as: State legislative decisions impacting revenue flows to the District, acceleration of capital project work, unexpected benefit increases, new regulations, unanticipated increases in costs such as chemicals and utilities, unforeseen emergency situations, unexpected drops in revenue such as loss of some portion of property tax or changes in the economy such as housing slowdowns, and unexpected economic conditions in general that affect our revenue or expense. C. \Documents and Settings \cgee \Local Settings \Temporary Internet Files \Content Outlook \4VS9801A\Financial Reserves - Funds Required Guidelines 6 5 13 (2).doc Minimum Funds Required Requirements Below are definitions and our minimum Funds Required requirements in our four internal sub -funds based on annual cash -flow analyses. These thresholds should not drop below the minimum requirements as of June 30th each fiscal year. Also, while we show a minimum Funds Required amount for each internal sub -fund, temporary investments are recorded in the Sewer Construction Fund, with the exception of Self - Insurance that has its own investment pool. Minimum Funds Required are: • Running Expense Sub -Fund (Operations & Maintenance or O &M) accounts for the general operations of the District. Substantially all operating revenues and expenses are accounted for in this internal sub - fund. o Minimum Cash Funds Required = 32% of the next year's budgeted O &M expenses. Debt Service Sub -Fund accounts for activity associated with the payment of the District's long term bonds and loans. There is a Legally Restricted Reserve Requirement of one annual bond payment for each issuance held by our trustee, U.S. Bank, in the event the District is not able to make its payment. Funds held in this account will be used to make the last year's debt service payments for each issuance. o Minimum Cash Funds Required = 100% of next year's principal and interest, which must be paid each year per our bond document. Sewer Construction Sub -Fund (Capital or S /C) accounts for non - operating revenues, which are to be used for acquisition or construction of plant, property and equipment o Minimum Cash Funds Required = 30% of the next year's budgeted Capital Project Expenditures. • Self- Insurance Sub -Fund accounts for interest earnings on cash balances in this sub -fund and cash allocations from other sub - funds, as well as for costs of insurance premiums, deductibles, and claims not covered by the District's insurance policies. o Minimum Cash Funds Required: determined by an Actuarial Study that is performed every-other year. The current temporary investment balance is approximately $4.0 million. • Self - insurance Funds Required is not included in the 10 -year financial plan model. GASB 45 funds set aside for future retiree healthcare premiums are not included in our funds available. D18