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HomeMy WebLinkAbout14.d. Committee Minutes-Finance 10-20-20 Page 1 of 11 Item 14.d. CENTRALSAN jdf A- hom CENTRAL CONTRA COSTA SANITARY DISTRICT November 5, 2020 TO: HONORABLE BOARD OF DIRECTORS FROM: KATIE YOUNG, SECRETARYOF THE DISTRICT SUBJECT: OCTOBER 20, 2020 - FINANCE COMMITTEE - CHAIR CAUSEYAND MEMBER NEJEDLY Attached are minutes of the above Committee meeting. ATTACHMENTS: 1. Minutes of 10-20-20 meeting 2. Item 6.a. - Updated Presentation November 5, 2020 Regular Board Meeting Agenda Packet- Page 140 of 150 Page 2 of 11 F CENTRAL SAN CONTRACENTRAL •STA SANITARY DISTRICT 5019 IMHOFF REGULAR MEETING OF THE BOARD OF DIRECTORS: CENTRAL CONTRA COSTA MICHAELMCGILL President SANITARY DISTRICT TAD JPILECKI FINANCE COMMITTEE President Pro Tem PAUL H CA USEY JAMES A.NEJEDLY M I N U T E S DAVID R, WILLIAMS PHONE: (925)228-9500 92 Tuesday, October 20, 2020 FAx cent alsan. rg www.centralsan.org 2:00 p.m. Executive Conference Room 5019 Imhoff Place Martinez, California (All attendees participated via videoconference) Committee: Chair Paul Causey Member Jim Nejedly Staff. Roger S. Bailey, General Manager Katie Young, Secretary of the District Phil Leiber, Director of Finance and Administration Jean-Marc Petit, Director of Engineering and Technical Services Danea Gemmell, Planning and Development Services Division Manager John Huie, Information Technology Manager (left after Item 6.b.) Stephanie King, Purchasing and Materials Manager Edgar Lopez, Capital Projects Division Manager (left after Item 6.c.) Kevin Mizuno, Finance Manager Shari Deutsch, Risk Management Administrator (joined during Item 5.b.) Heather Ramamurthy, Management Analyst Donna Anderson, Assistant to the Secretary of the District Amelia Berumen, Senior Administrative Technician 1. Notice This meeting was held in accordance with the Brown Act as in effect under the State Emergency Services Act, the Governor's Emergency Declaration related to COVID- 19, and the Governor's Executive Order N-29-20 issued on March 17, 2020 that allowed attendance by Board Members, District staff, and the public to participate and November 5, 2020 Regular Board Meeting Agenda Packet- Page 141 of 150 Page 3 of 11 Finance Committee Minutes October 20, 2020 Page 2 conduct the meeting by teleconference, videoconference, or both. The agenda included instructions for options in which the public could participate in the meeting. 2. Call Meeting to Order Chair Causey called the meeting to order at 2:00 p.m. 3. Public Comments - None. 4. Old Business a. Follow-up to questions asked at the September 22, 2020 Finance Committee meeting regarding a specific expenditure COMMITTEE ACTION: Received the information. 5. Items for Committee Recommendation to the Board a. Review and recommend approval of expenditures incurred September 1, 2020 through October 2, 2020 Mr. Mizuno pointed out that the expenditures listing was the first to be generated by the new Oracle Enterprise Resource Planning (ERP) system and contained more detail than the lists generated by the old SunGard system. Throughout the coming months, staff will be refining the listing to achieve a cleaner look and reduce redundancies. Staff responded to questions posed in advance of the meeting by Chair Causey and during the meeting by Member Nejedly regarding the expenditures listing. During the discussion, Chair Causey noted that the expenditures listing included one or more payments related to contracts with Woodard & Curran, with whom he currently has a consulting contract on matters unrelated to Central San. Therefore, in an abundance of caution, he said he would be recusing himself from voting on approval of expenditures at the upcoming Board meeting. Two noteworthy items were as follows: Check Nos. 300483 and 300569 to Temp Services Mr. Mizuno explained that these two checks, totaling approximately$8,000, were for an agency-hired temporary clerk to process all transactions into the SunGard system while both SunGard and Oracle ERP were running parallel for two months. He said the temporary help was authorized by Mr. Bailey and has been a tremendous benefit in dealing with backlog and other issues that arose during implementation of the Oracle system. It is anticipated that the services of this temporary clerk will conclude by mid-November. November 5, 2020 Regular Board Meeting Agenda Packet- Page 142 of 150 Page 4 of 11 Finance Committee Minutes October 20, 2020 Page 3 In response to a question from Chair Causey, Mr. Mizuno explained that accounting rules related to software as a service (SaaS) do not allow costs to be capitalized once a program has gone live. Thus, these temporary services were allocated to Operations and Maintenance rather than the ERP project. Check No. 300503 to CPS HR Consultinq - $17,200 Mr. Mizuno said this payment was for the employee engagement survey conducted by an outside agency during the last fiscal year, including an on- site kickoff event. The payment was for work performed to launch the survey. The project has since been put on hold. In response to a question from Chair Causey, Mr. Mizuno said the entire consulting contract was for an amount just over$48,000. Chair Causey asked why the project was put on hold and suggested that the Board receive an update on the project status. Staff will follow up. COMMITTEE ACTION: Recommended Board approval and suggested that the Board receive an update on the status of the employee engagement survey project. b. Receive August 2020 Budget-to-Actual Financial Overview Mr. Mizuno highlighted the August Financial overview. He also noted that until the Oracle Planning and Budgeting Cloud Service (PBCS) component of the ERP system goes live, it will be difficult to apportion revenues such as sewer service charges in anything other than 1112th monthly increments. Chair Causey suggested adding a note that sewer service charges are typically received in December and April/May, rather than in equal monthly installments throughout the year. COMMITTEE ACTION: Recommended Board receipt. 6. Other Items a.* Receive update on grant application efforts, showcasing opportunities for Federal Emergency Management Agency (FEMA) Hazard Mitigation Assistance (HMA) of selected infrastructure projects Planning and Development Services Division Manager Danea Gemmell reviewed the presentation included with the agenda material. She focused on two programs offered by FEMA, both of which emphasize pre-disaster mitigation: 1. BRIC (Building Resilient Infrastructure and Communities): This program, which is in the pre-application stage, is for capital projects. November 5, 2020 Regular Board Meeting Agenda Packet- Page 143 of 150 Page 5 of 11 Finance Committee Minutes October 20, 2020 Page 4 Staff is looking to see if the District can be a recipient under this plan. If so, and an authorization to proceed is received, staff will submit a full application, which would be due next January, with award in June 2021. 2. HMGP (Hazard Mitigation Grant Program): This program is designed for capital projects involving Global Information System (GIS) early warning systems. An upcoming pump station project to raise elevations to avoid flooding may be a good fit. Ms. Gemmell presented a new Slide 6 (see attached) reflecting that the Walnut Creek/Grayson Levee project and the Cogeneration Power Source project have been given the go-ahead to submit applications in January 2021 under the HMGP program. In conclusion, Ms. Gemmell said she and her staff will continue to seek other grant opportunities. COMMITTEE ACTION: Received the information. b. Receive report on software expenditures Chair Causey expressed appreciation for staff's time and effort in providing the report included with the agenda material. He asked what has been learned about the following software expenditures, which are no longer in use: 1) QLess: Line queueing software for the Permit Counter and for scheduling appointments at the Household Hazardous Waste Facility, which will not be used after the initial first-year license due to changes in operational needs - $18,500; 2) SunGard HTE: Former ERP system, now replaced with new Oracle ERP system - $108,000 per year; and 3) Intellitime: Timekeeping software, now replaced with a component in the new Oracle ERP system - $79,000 plus $8,000 for support. Mr. Huie said it was not the original intent to abandon Intellitime; however, it became clear that doing so was the right decision once staff witnessed the ability of Oracle to manage project time and seamlessly move information back and forth. Moving forward, staff will review every new program in a thoughtful and planned manner, which is one of the goals in the updated Information Technology (IT) master plan currently in development. Chair Causey was pleased with Mr. Huie's response. November 5, 2020 Regular Board Meeting Agenda Packet- Page 144 of 150 Page 6 of 11 Finance Committee Minutes October 20, 2020 Page 5 Chair Causey also asked if the Oracle ERP system has eliminated the need for the Engineering Department to run separate books for consultant and project costing. Mr. Leiber said the Engineering Department is using Oracle Projects to manage project budgets, costs, and contracts. At the same time, it is continuing to use e8uilder for construction management, work scheduling, and file management. The plan is to continue integrating the two tools and, ultimately, assess the need for e8uilder. Mr. Lopez added that consultant contracts and change orders continue to be maintained separately. He is working with Mr. Mizuno to transition this data to Oracle. With respect to Oracle ERP system, Mr. Huie said he expects some incremental charges going forward, but there should be no large increases in ERP costs over the next five years. The costs to support SunGard HTE will cease. The new IT master plan currently in development will include prioritizing improvements and incorporating more needs of the Engineering Department and plant maintenance. He expects to see a continued upward trend for software costs, which hopefully will be offset by reduced costs to operate the plant through automations, which will allow for improved productivity from existing staff and may help avoid the need for new staff. COMMITTEE ACTION: Received the information. C. Receive Fiscal Year 2019-20 Risk Management Annual Report Ms. Deutsch reviewed the presentation included with the agenda material and responded to several questions from the Committee. Chair Causey asked how the District's total cost of risk (ICOR) compared with other agencies. Ms. Deutsch said TCOR is usually expressed as a percentage of revenue, but Central San is not a revenue-producing agency. Trying to find a benchmark for comparison purposes has been challenging. She said staff is evaluating whether the utility segment of a TCOR metric used by the Risk Insurance Management Society (RIMS) would be a more relevant comparison with peer agencies. If so, she is hopeful that data can be included in next year's report. Chair Causey said he appreciated the hard work that went into producing such an impressive report. COMMITTEE ACTION: Received the report. November 5, 2020 Regular Board Meeting Agenda Packet- Page 145 of 150 Page 7 of 11 Finance Committee Minutes October 20, 2020 Page 6 d. Review Risk Management Loss Control Report as of October 6, 2020 Ms. Deutsch briefly highlighted changes from the report presented at the last meeting. COMMITTEE ACTION: Received the report. 7. Announcements — None. 8. Suggestions for Future Agenda Items a. Receive list of upcoming agenda items and provide suggestions for any other future agenda items Chair Causey inquired as to why the discussion regarding the State's ability shift property tax revenues during budget crises was held at this morning's Administration Committee meeting rather than at the Finance Committee. Mr. Leiber acknowledged that the substance of the item was probably more of a Finance issue; however, staff placed it on the Administration Committee agenda because it was originally suggested by President McGill, who sits on that Committee. In any event, he said the item is expected to be presented to the full Board soon. COMMITTEE ACTION: Received the list and provided input to staff. 9. Future Scheduled Meetings Tuesday, November 17, 2020 at 1:00 p.m. Tuesday, December 15, 2020 at 2:00 p.m. 10. Adjournment— at 3:21 p.m. November 5, 2020 Regular Board Meeting Agenda Packet- Page 146 of 150 Page 8 of 11 ATTACHMENT 2 Item 6.a.(Updated Presentation) GRANT APPLICATION OPPORTUNITIES Planning & Development Services Danea Gemmell, Division Manager Finance Committee Oct. 20, 2020 MMMKq3n2TY_"&T_M,1 GRANT OPPORTUNITIES REVIEWED TO SUPPLEMENT SEWER CONSTRUCTION FUND Program Emphasis Funding 'Ierplication Date Award Date BRIC(Cal OES/FEMA) Pre-Disaster Mitigation $500M nationwide Sept.2020 June 2021 HMGP(Cal OES/FEMA) Pre-Disaster Mitigation Revolving nationwide Varies* Varies* Measure AA SF Bay Restoration $12M locally Oct.2020 Spring 2021 CA Coastal Conservancy State Coastal Conservation$15M statewide Ongoing Ongoing *The California Office of Emergency Services(Cal OES)Notice of Interest(NOI)deadlines for the Hazard Mitigation Grant Program(HMGP)revolve around funding released throughout the year.Building Resilient Infrastructure and Communities(BRIG)grants have an established schedule. Iz November 5, 2020 Regular Board Meeting Agenda Packet- Page 147 of 150 1 Page 9 of 11 FEMA BUILDING RESILIENT INFRASTRUCTURE AND COMMUNITIES (BRIC) • New grant to replace Pre-Disaster Mitigation (PDM) grant • More flexible administration; removes cutoff date on pre-award costs • Prioritizes infrastructure, lifelines, nature-based solutions, modern building codes • Funded annually by 6% set-aside from federal post-disaster grant funding • 2020 FEMA response to COVID-19 and wildfires will result in higher funding in 2021 • Current total Notice of Funding Opportunity (NOFO) is $500M • $600K for state/territory allocations (planning and scoping) • $50M cap on projects at national competition level Cal OEI N01:Sept.'20 1 3 rAWSPY-TIM M, FEMA HAZARD MITIGATION GRANT PROGRAM (HMGP) • Traditional hazard mitigation grant program • Prioritizes shovel-ready and large infrastructure projects • First consideration currently to counties hit by fires but others still qualify • Types of funding • Advanced Assistance: primarily planning and early design only • Capital Projects: structural elevation, flood control, seismic retrofit, generators • 5% Initiative: generators, GIS, early warning systems, public awareness&education • Funding and deadlines are always revolving depending on disaster occurrences CFNTPAISAN November 5, 2020 Regular Board Meeting Agenda Packet- Page 148 of 150 2 Page 10 of 11 CONSERVATION GRANTS NOT PURSUED • SF Bay Restoration Authority (Measure AA Grant) • Prioritizes flood management and public access projects • Prior awards range from $120K to $5M • Application deadline: Oct. 2020 • Grant recommendations: Spring 2021 • CA Coastal Conservancy: Coastal Resource and Public Access Program • Prioritizes projects with public access to coastal areas, protection and restoration of natural lands, preservation of working lands, and increased community resilience • Provides varying amounts for planning, design and implementation of capital projects • Total funding available: $15M • Application deadline and awards: ongoing ' S NOTICES OF INTEREST (NOIS) APPROVED BY CAL OES IN SEPTEMBER ApplicationGrant Category Project Phase Invited to Full BRIC Maltby Pump Station Upgrade $590,000 Project Design/Construction Yes HMGP Maltby Pump Station Upgrade $600,000 Project Design/Construction No BRIC Walnut Creek/Grayson Levee $1,812,000 Project Design/Construction Yes HMGP Walnut Creek/Grayson Levee $1,902,000 Project Design/Construction Yes HMGP Cogeneration Power Source $72,000* Phased Project* Scoping/planning Yes HMGP Cogeneration Power Source $72,000 Advanced Assistance Scoping/planning Yes 1. *Cal CES approved a Phased Project NCI for cogeneration to initially cover scoping and planning.It will now progress to the full application cycle. If the planning grant is approved,a subsequent grant application for capital implementation would receive priority next year. ' 6 November 5, 2020 Regular Board Meeting Agenda Packet- Page 149 of 150 3 Page 11 of 11 QUESTIONS November 5, 2020 Regular Board Meeting Agenda Packet- Page 150 of 150 4