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Home My WebLink AboutBUDGET AND FINANCE ACTION SUMMARY 11-04-13Central Contra Costa Sanitary District (th and the environment • Imhoff , .. SPECIAL MEETING OF THE CENTRAL CONTRA COSTA B04RDOFDIRECTORS: JAA -IESA. NEJEDLP SANITARY DISTRICT President BUDGET AND FINANCE COMMITTEE DAT7DR. uILLIAnIS President Pro Tem P.-1 UL H. CA i SEF ACTION SUMMARY 1IICHDELR.- 1fCGILL TAD J. PILECKI Chair McGill PHONE: (925) 228 -9500 F4-I: (925) 676 -7211 Member Nejedly ivivi v.xenrtnlsan.org Monday, November 4, 2013 3:00 p.m. Collection System Operations (CSO) Main Conference Room 1250 Springbrook Rd. Walnut Creek, CA 94597 PRESENT: Chair Mike McGill, Member Jim Nejedly, General Manager Roger Bailey, Finance Manager Thea Vassallo, Director of Operations Curt Swanson, Environmental Services Division Manager Danea Gemmell, Senior Engineer Thomas Brightbill, Engineering Assistant III Earlene Millier, Safety and Risk Management Administrator Shari Deutsch (left after Item 3.), Purchasing and Materials Manager Stephanie King (for Item 13.) 1. Call Meeting to Order Chair McGill called the meeting to order at 3 p.m. 2. Public Comments None. 3. Old Business a. Review staff's responses to the Committee's request for information regarding the following expenditures at the previous meeting: Check Date Amount Vendor 196842- 197009 9/23/13 Various Various District Retirees If the District's auditors audit the reimbursements for Medicare Part B paid to District retirees. Budget and Finance Committee Action Summary November 4, 2013 Page 2 Check Date Amount Vendor 197027 9126113 $2,612.34 Child Environmental Directed staff to review other options for wet ash disposal. b. Review staff's response regarding an inquiry by Member Nejedly at a previous meeting regarding the possibility of Pacific Gas and Electric (PG &E) performing an energy audit COMMITTEE ACTION: Reviewed staff's responses. Director of Operations Curt Swanson to provide information on alternative options for wet ash disposal at a later date. 4. Risk Management a. Review Loss Control Report and discuss outstanding claims Member McGill asked that staff inquire with District counsel on whether legal fees related to AB 197 should be charged to Operations or Self Insurance, Sub Fund B - Employment related risks. COMMITTEE ACTION: Reviewed the report. 5. Approve the Statement of Investment Policy No. BP 005 for District assets and the Investment Guidelines Document for the Government Accounting Standards Board (GASB) 45 Trust (Item 3.d. in Board Binder) Finance Manager Thea Vassallo summarized information in Attachment 3, Schedule of Allowable Investment and Current Rate of Returns, and asked if the Committee wanted to consider changing the Investment Policy. Member McGill recommended that the current policy be left as is. Ms. Vassallo stated that the Board Policy objectives are 1. Liquidity, 2. Safety, and 3. Yield. It was discussed that higher return would require longer maturities. COMMITTEE ACTION: Reviewed and recommended Board approval. 6. Consider recommendation of the District's Deferred Compensation Advisory Committee to consolidate management of the District's 457 and 401(a) Deferred Compensation Plan assets under one carrier, ICMA -RC; approve the Administrative Services Agreement between the District and ICMA -RC; and authorize staff to execute the appropriate documents (Item 6.a. in Board Binder). The estimated completion of transition is March 2013. Member McGill stated that the Committee has monitored and reviewed the progress throughout the consolidation process and has performed its fiduciary responsibility. Ms. Vassallo discussed the 457 and 401(a) balances and number Budget and Finance Committee Action Summary November 4, 2013 Page 3 of members with ICMA -RC, Nationwide, and MassMutual (previously Hartford). See Item 6.a. in Board Binder, Attachment 1. COMMITTEE ACTION: Reviewed and recommended Board approval. 7. Consider request from property owner for an installment payment plan for delinquent charges related to the property located at 700 Via Hermosa in Danville, to be placed on the Contra Costa County property tax roll for collection in five annual installments starting in Fiscal Year 2013 -14 Engineering Assistant 111 Earlene Millier reported that the property owners at 700 Via Hermosa will not be able to attend the November 21St Board meeting. Member Nejedly stated that the item could either be scheduled late in the meeting or the property owners could send a letter with their request. COMMITTEE ACTION: Considered request and confirmed that the Committee is not recommending the installment payment plan. *8. Receive update on preliminary administrative overhead calculations Ms. Vassallo reported that the in -house overhead calculation has been completed early this year in order to provide information to an outside consultant. Using the current full cost recovery method used in past years, the percentage calculated is 234% for Fiscal Year 2014 -15. District staff met with Matrix Consulting Group on Friday, November 1, 2013 and is anticipating a preliminary report from the consultant by the end of November. Ms. Vassallo anticipates this matter will be brought to the full Board in December for discussion and staff direction. General Manager Roger Bailey stated that the consultant thought the current calculation used by the District was fairly simple, and multiple rates will be reviewed as part of the scope of work. COMMITTEE ACTION: Received the update. 9. Review September 2013 Financial Statements and Investment Reports (Item 3.c. in Board Binder) Ms. Vassallo and Environmental Services Division Manager Danea Gemmell reported that activity at the Permit Counter has increased and that the September increase in Facility Capacity Fees is a result of a $1.7 million check received for an apartment complex being built in Walnut Creek. COMMITTEE ACTION: Reviewed and recommended Board approval. 10. Review Expenditures (Item 3.b. in Board Binder) 11 lira 1191 14 Budget and Finance Committee Action Summary November 4, 2013 Page 4 COMMITTEE ACTION: Reviewed and recommended Board approval. Requested the following information: Check Date Amount Vendor 103144 10/10/13 $5,527.72 Servicemaster Restoration 197231 10/10/13 $6,454.13 Dept of Toxic Substances Announcements Ms. Vassallo announced that she would be away from the District November 24th through December 1, 2013. Suggestions for future agenda items Discuss the Quarterly report from HighMark Capital Management, which has been received for the GASB 45 Trust. Visit Solids Control Building (SCB) and MSB Warehouse for further inventory review. Visit warehouse at Collection System Operations (CSO) Building Mr. Swanson summarized the daily activities of the CSO warehouse. The Committee and Mr. Bailey discussed the importance of managing and putting in place internal controls for open inventory. Purchasing and Materials Manager Stephanie King explained the roles of warehouse staff and CSO staff in managing this inventory. The warehouse staff comes to CSO once or twice a year to inventory the items at this location. The CSO staff is in charge of managing the issuance of items and reporting this back to warehouse staff. The on -hand value of the CSO inventory is approximately $100,000. An observation was made that the size of the inventory was relatively small, and the items that are of more value and tend to be more prone to go missing were placed in a separate locked area and needed to be issued out by designated staff. Given this information, employing tighter controls, such as adding an employee to be stationed at this site during business hours to issue out supplies, does not appear to be necessary at this time. The other two inventory locations will be visited at the next Committee meeting. COMMITTEE ACTION: Visited the warehouse. Adjournment — at 4:10 p.m. * Attachment use tsuoge[ 2014 - 2015 2013 -2014 Increase Employee Benefits 87% 84% Administrative Overhead 129% 117% Non -work Hours 18°% 18°% Increases to Employee Benefits: Employee healthcare premiums and CCCERA rate increase Benefit Increases IAdmin Overhead: Additional S5.0 million CCCERA payment 22°% Impact of artificially low salaries used In the denominator Iasi year -8°% 180.15% Alternative Method 216.00% 3 -Year Smoothing Summary 1415 Page 1 Central Contra Costa Sanitary District Administrative Overhead Summary For the 2014 -15 Budget - Calculated using 2012 -2013 Audited Financial Statements Last Year's for Current Calculation Comparison (For - For 2014 -2015 2013 -2014) Variance Employee Benefits 86.58% 84.39% 2% Administrative Overhead 129.32% 117.18% 12% Non -work Hours 18.00% 18.15% 0 % 233.91% 219.72% 14% Recommendation: 234% use tsuoge[ 2014 - 2015 2013 -2014 Increase Employee Benefits 87% 84% Administrative Overhead 129% 117% Non -work Hours 18°% 18°% Increases to Employee Benefits: Employee healthcare premiums and CCCERA rate increase Benefit Increases IAdmin Overhead: Additional S5.0 million CCCERA payment 22°% Impact of artificially low salaries used In the denominator Iasi year -8°% 180.15% Alternative Method 216.00% 3 -Year Smoothing Summary 1415 Page 1