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HomeMy WebLinkAbout03.a.1) Approve minutes of December 18, 2014 meetingMINUTES OF THE REGULAR MEETING OF THE DISTRICT BOARD OF THE CENTRAL CONTRA COSTA SANITARY DISTRICT HELD ON DECEMBER 18, 2014 The Board of Directors of the Central Contra Costa Sanitary District convened in a regular meeting in the Board Room, 5019 Imhoff Place, Martinez, County of Contra Costa, State of California, at 2:00 p.m. on Thursday, December 18, 2014. President Williams called the meeting to order and requested that the Secretary call roll. 1. ROLL CALL PRESENT: Members: Causey, Nejedly, Pilecki, Williams ABSENT: Members: McGill a. PLEDGE OF ALLEGIANCE TO THE FLAG The Board and staff joined in the Pledge of Allegiance. b. INTRODUCTION None. The Board welcomed Ann Sasaki, Deputy General Manager in the Operations Department, effective December 15, 2014. 2. PUBLIC COMMENTS 3. CONSENT CALENDAR a. Approve minutes of November 20, 2014 Board meeting. b. Approve expenditures dated December 18, 2014. Approval recommended by Finance Committee. C. Approve updated administrative overhead percentage of 206 percent for Fiscal Year 2015 -16. Approval recommended by Finance Committee. d. Authorize the General Manager to execute a three -year permit contract with Acme Fill Corporation through November 30, 2017 for discharge of treated landfill leachate from the Acme Landfill in Martinez, California. Approval recommended by Real Estate, Environmental & Planning Committee. CENTRAL CONTRA COSTA SANITARY DISTRICT Board Minutes of December 18, 2014 e. Approve Board Member Tad Pilecki's attendance at California Special District Association (CSDA) Special District Leadership Academy from January 26 -28, 2015 in Napa. Authorize the General Manager to execute a technical engineering services agreement in an amount not to exceed $160,000 with V&A Consulting Engineers under the Collection System Modeling Upgrade, District Project 8418. Approval recommended by Engineering & Operations Committee. It was moved by Member Causey and seconded by Member Nejedly to adopt the Consent Calendar as recommended. Motion passed by unanimous vote of the Board Members present. 4. CALL FOR REQUESTS TO CONSIDER ITEMS OUT OF ORDER None. 5. REPORTS a. GENERAL MANAGER 1) General Manager Announcements The following announcements were included with the agenda packet: a) LAFCO Approved District Annexation 187 (Podva) in Danville b) BAYWORK "Training Buffet" held November 19, 2014 was Another Big Success No additional announcements were made at the meeting. b. COUNSEL FOR THE DISTRICT 1) Announce closed session (pursuant to Government Code Section 54957.7) District Counsel Kent Alm announced that a closed session had been placed on the agenda for Item 11.a. In view of the fact that he had recently provided a confidential, attorney - client memo updating the Board Members on the matter, he asked if a closed session was still desired. It was the consensus of the Board Members present that no closed session was needed. C. SECRETARY OF THE DISTRICT Secretary of the District Elaine Boehme announced the upcoming meeting of the Finance Committee on December 30, 2014 at 3:00 p.m. 2 CENTRAL CONTRA COSTA SANITARY DISTRICT Board Minutes of December 18, 2014 d. BOARD MEMBERS 1) Board Member reports on recent meetings for which they received the stipend; and meetings or conferences for which the District paid their expenses; future meetings or conferences for which they will receive the stipend or for which the District will pay their expenses Member Causey a) Member Causey and Member Nejedly reported on the December 8, 2014 meeting of the Finance Committee. The Board received the report without comment. Member Nejedly b) Member Nejedly reported on the December 9, 2014 meeting of the Real Estate, Environmental & Planning Committee. The Board received the report without comment. Member Pilecki c) Member Pilecki and Member Causey reported on the December 9, 2014 meeting of the Engineering & Operations Committee. The Board received the report without comment. President Williams d) President Williams reported on the November 26, 2014 meeting of the Administration Committee. The Board received the report without comment. e) President Williams reported on the December 2, 2014 meeting of the Administration Committee. The Board received the report without comment. 2) Board Member Announcements None. 3) Board Member requests for advance authorization to receive a stipend for meeting attendance not specifically addressed in the current Board Compensation Resolution None. 3 CENTRAL CONTRA COSTA SANITARY DISTRICT Board Minutes of December 18, 2014 4) Receive and approve 2015 Board Committee and other assignments as proposed On behalf of President -Elect McGill, President Williams presented the following list of proposed 2015 Board Committee and other assignments: Standin_g Committees Administration Committee Chair: Williams Member: McGill Engineering & Operations Committee Chair: Causey Member: Nejedly Finance Committee Chair: Nejedly Member: Pilecki Real Estate, Environmental & Planning Committee Chair: Pilecki Member: McGill Representatives to Outside Agencies California Special Districts Association (Contra Costa Chapter) Representative: President McGill Alternate: Member Williams National Association of Clean Water Agencies (NACWA) Representative: Member Causey Alternate: Member Williams Board Liaisons to Cities and County Concord, Contra Costa County Member Nejedly Alamo, Danville, San Ramon Member Causey Pleasant Hill, Walnut Creek President McGill Martinez, Pacheco Member Pilecki Moraga, Orinda, Lafayette Member Williams It was moved by Member Causey and seconded by Member Nejedly to approve the proposed 2015 Board Committee and other assignments. Motion passed by unanimous vote of the Board Members present. 4 CENTRAL CONTRA COSTA SANITARY DISTRICT Board Minutes of December 18, 2014 6. ENGINEERING a. RECEIVE PRESENTATION ON THREE POWER PURCHASE AGREEMENTS WITH SUN EDISON, LLC FOR SOLAR PHOTOVOLTAIC PANELS AT THE DISTRICT'S HOUSEHOLD HAZARDOUS WASTE FACILITY, COLLECTION SYSTEM OPERATIONS BUILDING, AND VEHICLE MAINTENANCE SHOP, AND CONSIDER WHETHER TO SET A PUBLIC HEARING IN ACCORDANCE WITH GOVERNMENT CODE SECTION 4217.12. ENGINEERING & OPERATIONS COMMITTEE RECOMMENDED SETTING A PUBLIC HEARING FOR JANUARY 8, 2015. [Continued from December 4, 2014] General Manager Roger Bailey stated that in January 2013, the District entered into a Memorandum of Understanding to participate in a regional procurement process for solar power. While the position paper for this item proposed a public hearing date of January 8, 2015, staff would prefer that if the Board approves moving forward with setting the public hearing, that it be scheduled for later in January or February after staff has received the final draft agreement from the solar vendor, SunEdison. Associate Engineer Dan Frost presented information on the potential power purchase agreements (PPAs) for solar power at the District's Collection System Operations (CSO) Building, Vehicle Maintenance Shop, and Household Hazardous Waste Facility (HHWF). He explained that solar PPAs allow the use of renewable energy without up -front capital expenditures to the participating agencies, with the primary goal of lowering their power costs in exchange for purchasing power generated by the solar panels at fixed terms. Based on the assumptions used in the PPAs, the potential 20 -year cost savings to the District are estimated to be $198,765 for the CSO Building, $67,366 for the HHWF, and $36,306 for the Vehicle Maintenance Shop. Noting that the potential cost savings seem rather low in his opinion, Member Nejedly asked staff to explore the potential payback period if the District were to install its own solar panels, as some school districts have done. Mr. Frost said the estimated payback period for District -owned panels would be well beyond 15 years; the PPA option was selected because it requires no capital investment from the District. It was moved by Member Pilecki and seconded by Member Causey to set a public hearing for an unspecified date prior to February 28, 2015 to consider authorizing the General Manager to enter into three PPAs with Sun Edison, LLC for solar photovoltaic panels at the District's HHWF, CSO Building, and Vehicle Maintenance Shop, and to receive a supplemental presentation from staff with the additional information requested by the Board Members at this meeting prior to selecting the public hearing date. Motion passed by the following vote of the Board: AYES: Members: Causey, Pilecki, Williams NOES: Members: Nejedly ABSENT: Members: McGill 5 CENTRAL CONTRA COSTA SANITARY DISTRICT Board Minutes of December 18, 2014 Member Nejedly explained that he voted against setting a public hearing date without first having considered information on cost/payback analyses from school districts that have installed their own solar panels. Agreeing with Member Nejedly on this point, President Williams moved to reconsider his prior motion to set a public hearing for an unspecified date. Member Nejedly seconded. Motion failed by the following vote of the Board: AYES: Members: Nejedly, Williams NOES: Members: Causey, Pilecki ABSENT: Members: McGill 7. ADMINISTRATIVE a. RECEIVE PRESENTATIONS REGARDING INFORMATION TECHNOLOGY MASTER PLAN (ITMP) FROM THE FOLLOWING CONSULTANTS AND CONSIDER ACCEPTING THE ITMP Mr. Bailey said the ITMP was recently completed and presented to the Administration Committee, which has recommended acceptance of the plan by the full Board. Simultaneous with the ITMP process, consultants from Electronic Image Designers, Inc. (EID) conducted a study of the District's recordkeeping practices, the findings of which have been incorporated into the ITMP. 1) Records management consultants Robert M. Blatt and Jo Dunlap of EID on their recent Records and Electronic Content Assessment of the District's records, and their suggestions for moving forward with an Electronic Content Management System (ELMS) Consultant Robert Blatt presented ETD's key findings with respect to the District's existing recordkeeping practices, noting that staff does a good job of managing many of the physical records. The District has a detailed retention plan and off -site storage for key documents, most of which are managed and tracked through the Versatile Records Management system. Reference documents are also maintained digitally in the LaserFiche document imaging system. Staff has been working hard to locate and incorporate into the Versatile database any physical records that have not previously been tracked. With regard to electronic records, however, Mr. Blatt said the District's records are not managed. Current software for managing electronic records (LaserFiche) is out of date and does not incorporate the necessary components and /or records management functionality needed by the District. At present, the District has multiple versions /copies of electronic records in several locations which are not being managed in accordance with the records retention schedule. A CENTRAL CONTRA COSTA SANITARY DISTRICT Board Minutes of December 18, 2014 Security and reliability of electronic records are significant issues which may prevent the District from being able to use any of its electronic records as "official" records for legal purposes. Mr. Blatt said EID recommends tackling the issues in two phases. Phase 1 would involve continued management of the physical records as at present, and customization and enhancement of LaserFiche. It would also involve, among other things, developing an enterprise-wide- taxonomy bridged to the records retention schedule and preparing a business practices document to ensure that official electronic records are placed under retention control in a "trustworthy" environment. He said the first phase might take three years. Phase 2 would not take place until stabilization of both the records program and after the more urgent IT Division matters have been accomplished as envisioned by the ITMP. During this phase the District would explore new software programs and ultimately select a full Electronic Content Management System (ECMS) that would meet the District's needs and requirements with regard to records management. Member Pilecki inquired as to the consequences of delaying action with respect to records management for three years until stabilization of other IT issues. Mr. Blatt opined that would not be advisable. From a technical point of view, the District has no trusted system for storing official records in an electronic format; and from a forensics point of view, there are so many electronic versions of documents that it is impossible to maintain control from practical and legal standpoints. Consultant Jo Dunlap further explained that a technical issue is whether the District's electronic records can be relied upon in certain legal settings. With the present system, the District may not be able to establish to a court's satisfaction that a record is true and accurate unless the paper copy is produced. If no trusted system is in place for electronic records, Mr. Blatt said the District could continue using paper copies as the official records. District Counsel Kent Alm said several things are needed if the District wishes to store its documents electronically, not all of which involve great expense. There must be a written plan, a secure system, a system that provides some level of document retrieval, and a program that tells staff how to utilize the system. He said EID has estimated the cost of such a system to be in the range of $80,000 to $100,000. President Williams asked if staff was requesting approval for an $80,000 to $100,000 investment at this time. Mr. Bailey said the ITMP incorporates a list of recommended actions, along with a schedule of when each is envisioned to be accomplished. 7 CENTRAL CONTRA COSTA SANITARY DISTRICT Board Minutes of December 18, 2014 2) Information technology (IT) consultants Joseph Blackwell and Stephen Madler of NexLevel IT Consulting on their recently completed analysis of the District's IT systems and operations, which led to development of the ITMP Joe Blackwell of NexLevel IT Consulting recapped the objectives of the ITMP and the methodologies used to develop it. He presented an assessment of where the District stands in terms of industry best practices and a chart summarizing the strengths, weaknesses, opportunities and threats to the IT system from both a divisional and District -wide perspective. He also presented a prioritized list of recommendations based on NexLevel's assessment, with top priority being modifications to the IT organizational structure and process realignment. With respect to actions taken to date, Mr. Blackwell summarized the progress that has been made in the following areas: security assessment and remediation; IT Operations governance, leadership and process improvement; and targeting of critical application and infrastructure updates. Stephen Madler of NexLevel reviewed the proposed IT staffing plan, which would involve two phases, one for remediation and another for restructuring. Because the current IT staffing structure is not adequately supporting the needs of the District, Phase 1, which is currently underway, would realign existing staff with a net increase of two full -time employees. Phase 2 would allow for 24/7 coverage options, proper alignment of staff skills with bandwidth, and address significant IT project roadmap requirements. Mr. Madler said the new IT Division would be headed by an IT Manager reporting to the Director of Administration. IT staff would be divided primarily into two groups, with half covering customer support, and the other half covering infrastructure support. There would also be a project manager/ business analyst position reporting directly to the IT Manager, who would be responsible for application and new technology support. Mr. Madler said this type of structure would help stabilize the IT Division and would be consistent with industry standards, best practices, and the recommendations in the draft Staffing Needs Assessment currently under development by Raftelis Financial Consultants, Inc. in conjunction with the Cost of Service Study. NexLevel believes these changes will stabilize the environment in terms of asset management, customer service, backup processes, keeping the system up and running, and will help meet service level goals that IT is putting in place to move the organization forward. Mr. Blackwell concluded the presentation by reviewing the IT Roadmap and the proposed three -to- five -year timeline for full implementation. F CENTRAL CONTRA COSTA SANITARY DISTRICT Board Minutes of December 18, 2014 Member Causey said he sees the ITMP as one of the greatest needs of the District, and the governance group being a key component to prevent the District from slipping backward. Mr. Bailey said the governance committee was still being formulated but would include at a minimum himself and the Department Directors. It was moved by Member Pilecki and seconded by Member Causey to accept the ITMP as presented. Motion passed by unanimous vote of the Board Members present. 8. CAPITAL IMPROVEMENT BUDGET PLANNING WORKSHOP a. RECEIVE PRESENTATION AND DISCUSS DEVELOPMENT OF DRAFT FISCAL YEAR 2015 -16 CAPITAL IMPROVEMENT BUDGET AND 2015 CAPITAL IMPROVEMENT PLAN Director of Engineering Jean -Marc Petit presented a summary of the proposed 2015 Ten -Year Capital Improvement Plan (CIP) and the Fiscal Year (FY) 2015 -16 Capital Improvement Budget (CIB). He noted that staff recently met with the Engineering & Operations Committee to present a preliminary version of this material. Mr. Petit presented a proposed 2015 Ten -Year CIP for the District's capital improvement program totaling $415 million, an increase of $61 million over the previous year's estimate. He also presented a spreadsheet illustrating the likely capital plan drivers over the next 20 years and how they could impact the capital program. As he had explained at the Board Workshop held on November 17, 2014, the four main drivers that impact the CIP are: 1) replacement and rehabilitation (aging assets), 2) capacity expansion, 3) regulatory issues, and 4) sustainability/ optimization. With regard to the proposed FY 2015 -16 CIB, Mr. Petit said it funds the Collection System Program at $16.5 million, the Treatment Plant Program at $12.9 million, the General Improvements Program at $4.0 million, and the Recycled Water Program at $0.5 million, for a total of $33.9 million for the coming year. He described the projects funded by the four Programs and described the reasons for the proposed increases. Member Nejedly noted that the projections presented by Mr. Petit have been prepared by mostly new staff that has taken a fresh look at the District's needs. The drastic increase from earlier projections signaled to him that the previous staff was not keeping up with the District's pay -as- you -go approach, which he found very disheartening, particularly since the bid climate during the recent economic downturn was so advantageous to the District. Member Pilecki said the Engineering staff was moving projects forward as fast as possible during the recessionary period because of the positive bidding environment. However, staff turnover in recent years resulted in the deferral of approximately None. CENTRAL CONTRA COSTA SANITARY DISTRICT Board Minutes of December 18, 2014 $5 million worth of projects. In addition, $10 million was reallocated from the capital program to pay down the unfunded actuarial accrued liability (UAAL). Mr. Petit noted that staff spent a fair amount of time scrutinizing the capital budget for the next two years and believes that if projects are deferred, they will just stack up for future years. The proposed Comprehensive Wastewater Master Plan (CWMP), which has been included in the proposed CIB budget, will provide more clarity on what projects should be done, when they should be done, and how much they will cost. President Williams said it is always difficult to pinpoint exactly when projects need to go forward, especially when looking at a ten -year window. He said five years seems more realistic. He asked for information that would compare last year, this year, and projections for next five years in relation to projected rate increases. Such information would give the Board an opportunity from a policy level to let staff know the Board's comfort level in terms of potential rate increases. That information may also help with evaluating the risk associated with deferring any particular project. General Manager Roger Bailey said staff will run some scenarios to see how they impact the rates. Finance Administrator Todd Smithey said he had preliminarily run some of the numbers through the District's ten -year financial planning model, which estimated sewer service charge (SSC) rate increases of $34 and $33 over the next two years using last year's projections. If every project were included under the new projections, the SSC rate increases would be $57 and $57. If the $65 million projected UAAL payments were removed from the model, the projected SSC rate increases over the next two years would be $27 and $26. Member Causey said the Board should consider holding some study sessions before the budgets are approved. Also, he said it was important to begin getting word out to constituents to engage the public in the education process. Finally, he said zero -based budgeting should be implemented, after which projects can be added once funds become available. President Williams asked the Board Members if they would support asking staff to run several five -year rate scenarios with total SSC rate increases over those five years of $25, $35, and $50, and include some variables such as UAAL payments, increased percentages for Operations and Maintenance expenses, funds for building up fiscal reserves, and various CIP projects. The Board Members concurred with this suggestion. President Williams said it also would be helpful to receive a schedule of when decisions need to be made in order to meet Proposition 218 requirements for rate increases. 9. EMERGENCY SITUATIONS REQUIRING BOARD ACTION 10 None. CENTRAL CONTRA COSTA SANITARY DISTRICT Board Minutes of December 18, 2014 10. SUGGESTIONS FOR FUTURE AGENDA ITEMS 11. CLOSED SESSION a. Conference with Legal Counsel - Anticipated Litigation - significant exposure to litigation pursuant to Government Code Section 54956.9(b): None. • 69 La Espiral in Orinda. No closed session was deemed necessary after the Board received a confidential, attorney - client privileged memo from District Counsel on this matter. 12. REPORT OUT OF CLOSED SESSION 13. ADJOURNMENT There being no further business to come before the Board, President Williams adjourned the meeting at 5:55 p.m. David R. Williams President of the Board of Directors Central Contra Costa Sanitary District County of Contra Costa, State of California COUNTERSIGNED: Elaine R. Boehme, CIVIC Secretary of the District Central Contra Costa Sanitary District County of Contra Costa, State of California 11