HomeMy WebLinkAbout14.b. Committee Minutes-Finance 01-24-2023 Page 1 of 6
Item 14.b.
CENTRALSAN
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CENTRAL CONTRA COSTA SANITARY DISTRICT
February 23, 2023
TO: HONORABLE BOARD OF DIRECTORS
FROM: KATIE YOUNG, SECRETARYOF THE DISTRICT
SUBJECT: JANUARY24, 2023 - FINANCE COMMITTEE - PRESIDENT HOCKETTAND
MEMBER LAURITZEN
Attached are minutes of the above Committee meeting.
ATTACHMENTS:
1. Minutes of 01-24-23 meeting
February 23, 2023 Special Board Meeting Agenda Packet- Page 95 of 122
Page 2 of 6
r CENTRAL SAN
CONTRACENTRAL •STA SANITARY DISTRICT 5019 IMHOFF
REGULAR MEETING OF THE BOARD OF DIRECTORS:
BARBARA D.HOCKETT
CENTRAL CONTRA COSTA President
SANITARY DISTRICT MARIAHNLAURITZEN
President Pro Tent
FINANCE COMMITTEE MICHAEL R.MCGILL
TAD J PILECKI
DAVID R. WILLIAMS
MINUTES
Tuesday, Januar 24, 2023 PHONE: (925)228-9500
y FAX.- (925)372-0192
9:30 a.m. www.centralsan.org
(All attendees participated via videoconference)
Committee:
Chair Barbara Hockett
Member Mariah Lauritzen
Staff.
Katie Young, Secretary of the District
Danea Gemmell, Provisional Director of Engineering and Technical Services
Philip Leiber, Director of Finance and Administration
Benjamin Johnson, Internal Auditor
Emily Barnett, Communication Services and Government Relations Manager (left after Item 6.b.)
Edgar Lopez, Capital Projects Division Manager (joined during Item 5.a.; left during Item 6.b.)
Kevin Mizuno, Finance Manager
Christopher Thomas, Accounting Supervisor
Olivia Ruiz, Accounting Supervisor (joined during Item 6.b.)
Shari Deutsch, Risk Management Administrator
Stephanie King, Contracts and Procurement Program Administrator
Amelia Berumen, Assistant to the Secretary of the District
1. Notice
This meeting was conducted virtually in accordance with the provisions stipulated in
Assembly Bill 361 and adopted on January 12, 2023 by the Central San Board of
Directors. The agenda included instructions for options in which the public could
participate in the meeting.
2. Call Meeting to Order
Chair Hockett called the meeting to order at 9:30 a.m.
February 23, 2023 Special Board Meeting Agenda Packet- Page 96 of 122
Page 3 of 6
Finance Committee Minutes
January 24, 2023
Page 2
3. Public Comments
None.
4. Committee Charter
a. Review Committee Charter as set forth in Board Policy No. BP 013 —
Standing Committee Protocols, Guidelines and Charters
The Committee had no comments.
COMMITTEE ACTION: Reviewed the Charter.
5. Old Business
a. Follow-up to questions asked at the December 19, 2022 Finance Committee
meeting regarding one specific expenditure
Mr. Mizuno reviewed the details provided in the agenda memorandum in
regard to a payment to Alfred Conhagen, Inc. (Check 307693, $531,768.74).
He advised that upon further investigation, it was found that some of the
invoice components were considered a capital expenditure. Staff has since
transferred$124,000 to the proper capital project.
The Committee had no further questions.
COMMITTEE ACTION: Received the information.
6. Items for Committee Recommendation to the Board
a. Review and recommend approval of expenditures incurred December 9,
2022 through January 5, 2023
Mr. Mizuno provided the Committee with an extensive overview of the
current District process to review expenditures.
Chair Hockett spoke of the practice and advised she had reached out to
District Counsel to understand the statute. She opined that at the time the
statute was created nearly a century ago, expenditures were handled quite
differently than in today's business practice. As such, she would be
interested in the statute being amended. Discussion continued on the current
practice.
Mr. Leiber advised this item was presented first so the Committee would see
the current approach, and that the following agenda item was to discuss
alternatives for consideration.
February 23, 2023 Special Board Meeting Agenda Packet- Page 97 of 122
Page 4 of 6
Finance Committee Minutes
January 24, 2023
Page 3
The Committee had no questions on the expenditures.
COMMITTEE ACTION: Recommended Board approval.
b. Review draft Position Paper to consider revisions to the expenditure and
contracts review process conducted by the Finance Committee and provide
recommendations to either affirm or amend the current process
Mr. Leiber reviewed the information provided in the draft Position Paper and
discussed the listed alternatives as included in the agenda materials. These
alternatives are to pursue changes in the state code specifying Board
approval of expenditures, or to revise the existing process while aiming to
maintain compliance with the requirement. With respect to the first
alternative, he advised that staff has started conversations with CASA
(California Association of Sanitation Agencies) and local representatives
regarding change to the statute.
Ms. Barnett provided a more detailed summary of some of the steps taken.
She advised that some large steps have been taken with local legislators
that have been encouraging. She anticipates staff will be able to provide
more detail in the coming months on a possible legislative effort.
Mr. Mizuno drew attention to a new Finance Committee Member onboarding
document staff prepared and provided in advance of the meeting which
provided pertinent details of the finance process, including internal
procedures. He noted that should a change in the requirement through
legislation be successful, it may be an opportunity for Central San to have a
one page Board Policy for expenditure oversight that would direct future
processes. He later spoke of updates staff provides the Board and
Committee related to contracts executed within General Manager authority
for transparency.
A lengthy discussion followed regarding potential alternatives. With respect
to changes to processes potentially within the existing code language, staff
noted that enhanced Board review and approval could be provided for
contracts funded within the Operations and Maintenance budget, and that
expenditures could be filtered in a summary report that met various
subjective or objective criteria.
Chair Hockett thanked staff for the work accomplished thus far and noted the
goal was not to add to staff's task.
Member Lauritzen stated her support of a systemic, legislative fix and that it
would be premature to make changes to the process prior to seeing the
results of that approach.
February 23, 2023 Special Board Meeting Agenda Packet- Page 98 of 122
Page 5 of 6
Finance Committee Minutes
January 24, 2023
Page 4
In response to a question posed by Chair Hockett on whether contract
reviews should be a Committee function, Member Lauritzen stated it would
be useful to review some of the operations contracts. In her experience,
there is value in consistency of supplies, and some long-term contracts are
of use for basic goods.
There was further discussion regarding long-term contracts. Chair Hockett
would like the District to be able to change vendors to ensure competitive
pricing, as appropriate. She also expressed concern about consulting rates
that may be viewed as excessive, and that hourly rates should also be
subject of oversight.
Member Lauritzen agreed this was an area of concern and transparency was
warranted.
At the item conclusion, it was directed by the Committee for staff to pursue
the legislative path and provide relevant updates to the Committee before
presenting the issue to the Board for action.
COMMITTEE ACTION: Reviewed the information and directed staff to
pursue pending legislative action and provide an update to the
Committee at a future meeting.
C. Receive Budget-to-Actual Expenditure overview through the month of
December 2022
Mr. Mizuno provided the Committee with a detailed explanation of the
monthly expenditure overview reports.
In regard to the capital expenditures, Mr. Mizuno explained the blue graph
line is the target line for 90% of budget with roll-forward. The year-to-date
line has been adjusted for a reduction in the carry-forward that was
highlighted at the recent financial workshop. The District remains at about
the 50% mark with expenditures to date; however, staff expects that figure to
increase during spring with better weather. As a result of these carryforward
adjustments, the actual vs. 90% budget with roll-forward will be less than it
would have been.
Mr. Leiber referred to additional information provided in the January 23, 2023
Engineering & Operations Committee agenda packet. He noted the Capital
Projects Division Manager prepared a good report that explained the current
capital budget spending status.
Staff responded to various questions posed to the Committee's satisfaction.
February 23, 2023 Special Board Meeting Agenda Packet- Page 99 of 122
Page 6 of 6
Finance Committee Minutes
January 24, 2023
Page 5
COMMITTEE ACTION: Recommended Board receipt.
7. Other Items
a. Review Risk Management Loss Control Report as of January 10, 2023
Ms. Deutsch provided the Committee with the background and an overview
of the report, including an explanation of insurance coverage, and some
aspects of internal claims handling and classification. She reviewed each
loss-type category in detail and noted that nothing of significance had
transpired since the posting of the agenda.
COMMITTEE ACTION: Received the information.
8. Announcements
None.
9. Suggestions for Future Agenda Items
a. Receive list of upcoming agenda items and provide suggestions for any
other future agenda items
COMMITTEE ACTION: Received the list.
10. Future Scheduled Meetings
Tuesday, February 21, 2023 at 9:30 a.m.
Tuesday, March 21, 2023 at 9:30 a.m.
Tuesday, April 25, 2023 at 9:30 a.m.
11. Adjournment— at 10:46 a.m.
February 23, 2023 Special Board Meeting Agenda Packet- Page 100 of 122