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2017_10_26_board10/20/2017 BoardDocs® Pro https://www.boarddocs.com/ca/cmsdca/Board.nsf/Private?open&login#1/49 Thursday, October 26, 2017 Board of Directors Regular Meeting 290 Paularino Avenue, Costa Mesa 5:30PM A. OPENING ITEMS Subject 1. Call to Order Meeting Oct 26, 2017 - Board of Directors Regular Meeting Access Public Type Procedural 10/20/2017 BoardDocs® Pro https://www.boarddocs.com/ca/cmsdca/Board.nsf/Private?open&login#2/49 A. OPENING ITEMS Subject 2. Pledge of Allegiance Meeting Oct 26, 2017 - Board of Directors Regular Meeting Access Public Type Procedural 10/20/2017 BoardDocs® Pro https://www.boarddocs.com/ca/cmsdca/Board.nsf/Private?open&login#3/49 A. OPENING ITEMS Subject 3. Invocation Meeting Oct 26, 2017 - Board of Directors Regular Meeting Access Public Type Procedural 10/20/2017 BoardDocs® Pro https://www.boarddocs.com/ca/cmsdca/Board.nsf/Private?open&login#4/49 A. OPENING ITEMS (If absences occur, consider whether to deem those absences excused based on facts presented for the absence – such determination shall be the permission required by law.) Subject 4. Roll Call Meeting Oct 26, 2017 - Board of Directors Regular Meeting Access Public Type Procedural 10/20/2017 BoardDocs® Pro https://www.boarddocs.com/ca/cmsdca/Board.nsf/Private?open&login#5/49 A. OPENING ITEMS 1. Proclamation to Davis Farr, LLP for being honored as one of the Civic 50 in Orange County by the Orange County Business Journal Subject 5. Ceremonial Matters and Presentations Meeting Oct 26, 2017 - Board of Directors Regular Meeting Access Public Type Presentation, Procedural 10/20/2017 BoardDocs® Pro https://www.boarddocs.com/ca/cmsdca/Board.nsf/Private?open&login#6/49 A. OPENING ITEMS Unless directed otherwise by the Board of Directors, all actions shall be based on/memorialized by the latest document submitted as a late communication. Subject 6. Announcement of Late Communications Meeting Oct 26, 2017 - Board of Directors Regular Meeting Access Public Type Procedural 10/20/2017 BoardDocs® Pro https://www.boarddocs.com/ca/cmsdca/Board.nsf/Private?open&login#7/49 A. OPENING ITEMS This time has been set aside for persons in the audience to make the Board of comments on items within the subject matter jurisdiction of the Costa Mesa Sanitary District that are not listed on this agenda. Members of the public will have the opportunity to address Directors about all other items on this agenda at the time those items are considered. Under the provisions of the Brown Act, the Board of Directors is prohibited from taking action on oral requests but may refer the matter to staff or to a subsequent meeting. The Board of Directors will respond after public comment has been received. Please state your name. Each speaker will be limited to four (4) continuous minutes. Subject 7. Public Comments Meeting Oct 26, 2017 - Board of Directors Regular Meeting Access Public Type Procedural 10/20/2017 BoardDocs® Pro https://www.boarddocs.com/ca/cmsdca/Board.nsf/Private?open&login#8/49 B. CONSENT CALENDAR Subject 1. Approve Consent Calendar Meeting Oct 26, 2017 - Board of Directors Regular Meeting Access Public Type Action (Consent) Recommended Action That the Board of Directors approve the Consent Calendar as presented. 10/20/2017 BoardDocs® Pro https://www.boarddocs.com/ca/cmsdca/Board.nsf/Private?open&login#9/49 B. CONSENT CALENDAR COSTA MESA SANITARY DISTRICT MINUTES OF BOARD OF DIRECTORS STUDY SESSION SEPTEMBER 12, 2017 Members present Arlene Schafer, Art Perry, Bob Ooten, Jim Ferryman, Mike Scheafer Members Absent None Staff Present Scott Carroll (General Manager), Noelani Middenway (District Clerk), Steve Cano (Wastewater Maintenance Superintendent), Erick Caldera (Wastewater Maintenance Worker I), Rob Hamers (District Engineer), Ed Roberts (Code Enforcement Officer), Nabila Guzman (Management Analyst I), Gina Terraneo (Management Analyst I) Others Present Barry Friedland (Video Trek Productions), Jim Mosher (resident), Shelley Heller (CR&R) Meeting called to order at 9:29 A.M. A. OPENING ITEMS Procedural: 1. Call to Order President Scheafer called the meeting to order at 9:29 A.M. Procedural: 2. Roll Call District Clerk, Noelani Middenway, conducted roll call and all board members were present. Procedural: 3. Public Comments President Scheafer opened public comments. Seeing no one from the public wishing to speak, President Scheafer closed public comments. B. ITEMS OF STUDY Presentation: 1. New CMSD Employee Introduction: Erick Caldera, Wastewater Maintenance Worker I Recommendation: That the Board of Directors receive the presentation. Wastewater Maintenance Superintendent, Steve Cano, introduced new employee, Erick Caldera, Wastewater Maintenance Worker I. He noted that Mr. Caldera joined the District's staff approximately 3 weeks ago. The Board of Directors welcomed Mr. Caldera to the District. There were no further questions or comments and the presentation was received. Receive and File: 2. August 2017 CEO Report Subject 2. Approve the Board of Directors Study Session Meeting Minutes of September 12, 2017 Meeting Oct 26, 2017 - Board of Directors Regular Meeting Access Public Type Action (Consent) Recommended Action That the Board of Directors approve the meeting minutes as presented. 10/20/2017 BoardDocs® Pro https://www.boarddocs.com/ca/cmsdca/Board.nsf/Private?open&login#10/49 Recommendation: That the Board of Directors receive and file the report. Code Enforcement Officer, Ed Roberts, provided the August 2017 Code Enforcement Officer Report. Secretary Schafer requested that Mr. Roberts patrol the east side of Costa Mesa, as a result of scavenging reports that she has received from community members. Discussion followed regarding scavenging activity on the east side of Costa Mesa, the method of advisement for observed scavengers, and the remaining available lockable trash carts. There were no further questions or discussion and the report was received. Receive and File: 3. Website Statistics Recommendation: That the Board of Directors receive and file the report. Management Analyst I, Gina Terraneo, provided report details regarding key visitor statistics for the District's website. She noted that the website receives an average of 3,385 unique visitors per month and that frequently visited pages include the Large Item Collection Program page and the Christmas Tree Recycling Program page. Secretary Schafer asked what the Sewer Plan Specifications document is typically used for. District Engineer, Rob Hamers, explained that the Plan is used as a guide for drawing sewer plans. Discussion followed regarding the District's policy for pool draining and the popularity of the Large Item Collection Program. President Scheafer opened public comments. Jim Mosher, a resident, commented that the District's website is well-organized and suggested that the District provide public meeting attendees with guest access to WiFi during meetings. Additionally, he commented that the District's current budget is not posted on the District's website. General Manager, Scott Carroll, noted that the District's Finance Department is in the process of finalizing the budget document and that it will be posted on the website in the coming weeks. There were no further questions or discussion and the report was received. Action: 4. Consider Establishing a Citizens Advisory Committee Recommendation: That the Board of Directors consider establishing a Citizens Advisory Committee and direct staff to bring this Item back to the September 21, 2017 Board of Directors meeting. General Manager, Scott Carroll, presented report details regarding the proposed Citizens Advisory Committee (CAC). He noted that the committee would give citizens the opportunity to get involved in their community, gain knowledge about the District, serve as ambassadors to the District, and make recommendations to the Board of Directors on key decision making issues. Mr. Carroll added that the CAC would meet quarterly and would attend tours of local waste and wastewater facilities in order to get acquainted with the District. Vice President Ferryman asked which criteria will be used to select committee members. Mr. Carroll noted that the committee members must be District residents and that staff is open to suggestions for establishing criteria. Director Perry suggested using the City of Costa Mesa's format as a guide for developing the CAC. President Scheafer suggested that the committee be discussed at the State of the District & Open House on October 18, 2017. Discussion followed regarding the committee meeting structure, the possibility of having a Board Liaison present at committee meetings, and properly notifying the public of committee meetings. Secretary Schafer commented that there are details that should be addressed prior to rolling out the CAC. Vice President Ferryman suggested that an Ad Hoc Committee be formed to discuss the logistics of the CAC. Assistant Secretary Ooten indicated concern about the timeframe for establishing the CAC. President Scheafer opened public comments. 10/20/2017 BoardDocs® Pro https://www.boarddocs.com/ca/cmsdca/Board.nsf/Private?open&login#11/49 Jim Mosher, a resident, commented that the CAC is a commendable effort to engage the public, but noted that there are some errors in the staff report attachments. He also indicated concern with the number of CAC members the District is anticipating and suggested that the Board of Directors consider using a grand jury model for the CAC. Lastly, Mr. Mosher commented that the District would be subject to the Maddy Act and be required to maintain a Local Appointments List for the CAC. Discussion followed regarding gauging public interest in the CAC, refining the CAC once it is in place, staggering committee member terms, and committee reporting criteria. The Board of Directors directed staff to bring this item forward to the September 21, 2017 Board of Directors Meeting agenda. There were no further questions or discussion. Receive and File: 5. Organics Tonnage Report Recommendation: That the Board of Directors receive and file the report. General Manager, Scott Carroll, presented report details. Assistant Secretary Ooten requested that future organics tonnage reports include the predicted tonnage used when developing the budget for the program. Discussion followed regarding a reported trash cart issue from a previous Code Enforcement Officer report and the progress of CR&R's Anaerobic Digestion (AD) facility. President Scheafer requested that a tour be scheduled for the Board of Directors now that the facility is functional. Discussion followed regarding Director Perry's suggestion to use the Orange Coast College (OCC) Recycling Center as a transfer station. Assistant Secretary Ooten requested an update from CR&R regarding the amount of contamination in the organics collected from the District's service area. Secretary Schafer suggested that the next newsletter include a feature on the Organics Recycling Program. There were no further questions or discussion and the report was received. Receive and File: 6. Solid Waste Diversion Report Recommendation: That the Board of Directors receive and file the report. General Manager, Scott Carroll, presented report details. Assistant Secretary Ooten commented that the waste characterization report indicates which items can be recycled and asked if there was a way to find out how much non-recyclable material is collected. Shelley Heller of CR&R noted that CR&R does not generate reports on this information, but noted that she will attempt to find out which commonly collected materials cannot be recycled. Assistant Secretary Ooten requested that staff present a plan to reach the District's 75% diversion goal. Mr. Carroll noted that he will provide a report on this issue at the September 21, 2017 Board Meeting. Director Perry asked if staff knew the City of Costa Mesa's diversion rate. Discussion followed regarding the City's means of calculating its per capita disposal rate and how that differs from calculating a diversion rate. There were no further questions or discussion and the report was received. C. CLOSING ITEMS Procedural: 1. Oral Communications & Director Comments President Scheafer commented that residents often forget that holidays impact the trash collection schedule. 10/20/2017 BoardDocs® Pro https://www.boarddocs.com/ca/cmsdca/Board.nsf/Private?open&login#12/49 Secretary Schafer noted that the California Special Districts Association (CSDA) is hosting a tour of the Orange County Water District (OCWD), Orange County Cemetery District, and OC Vector Control on Thursday, October 12, 2017 at 8:30 a.m. Procedural: 2. Adjournment President Scheafer adjourned the meeting at 10:23 a.m. File Attachments minutes_2017_9_12_ss.pdf (46 KB) 10/20/2017 BoardDocs® Pro https://www.boarddocs.com/ca/cmsdca/Board.nsf/Private?open&login#13/49 B. CONSENT CALENDAR COSTA MESA SANITARY DISTRICT MINUTES OF BOARD OF DIRECTORS REGULAR MEETING SEPTEMBER 21, 2017 Members present Arlene Schafer, Art Perry, James Ferryman, Mike Scheafer Members absent Bob Ooten Staff present Scott Carroll (General Manager), Noelani Middenway (District Clerk), Alan Burns (District Counsel), Wendy Davis (Finance Manager), Marc Davis (District Treasurer), Robin Hamers (District Engineer), Nabila Guzman (Management Analyst I), Gina Terraneo (Management Analyst I) Others present Jim Mosher (resident), Luke Money (Daily Pilot), Dean Ruffridge (CR&R) Meeting called to order at 5:32 P.M. A. OPENING ITEMS Procedural: 1. Call to Order President Scheafer called the meeting to order at 5:32 P.M. Procedural: 2. Pledge of Allegiance President Scheafer led the pledge of allegiance. Procedural: 3. Invocation Vice President Ferryman led the invocation. Procedural: 4. Roll Call District Clerk, Noelani Middenway, conducted roll call and President Scheafer, Vice President Ferryman, Secretary Schafer, and Director Perry were present. Ms. Middenway noted that Assistant Secretary Ooten was absent and excused from the meeting. Procedural: 5. Ceremonial Matters and Presentations None at this time. Procedural: 6. Announcement of Late Communications None at this time. Procedural: 7. Public Comments President Scheafer opened public comments. Subject 3. Approve the Board of Directors Regular Meeting Minutes of September 21, 2017 Meeting Oct 26, 2017 - Board of Directors Regular Meeting Access Public Type Action (Consent) Recommended Action That the Board of Directors approve the meeting minutes as presented. 10/20/2017 BoardDocs® Pro https://www.boarddocs.com/ca/cmsdca/Board.nsf/Private?open&login#14/49 Jim Mosher, a resident, commented that the Board of Directors previously directed staff to include an item about the Citizens Advisory Committee in today's meeting agenda and noted that the item is not included in the agenda. General Manager, Scott Carroll, explained that staff is awaiting information from the City of Costa Mesa to complete the staff report for the Citizens Advisory Committee. He noted that the report will likely be included in the October 10 Study Session agenda. Seeing no one else wishing to speak, President Scheafer closed public comments. B. CONSENT CALENDAR Action (Consent): 1. Approve Consent Calendar Recommendation: That the Board of Directors approve the Consent Calendar as presented. Action (Consent): 2. Approve Board of Directors Study Session Meeting Minutes of August 8, 2017 Recommendation: That the Board of Directors approve the Study Session Minutes of August 8, 2017 as presented. Action (Consent): 3. Approve Board of Directors Regular Board Meeting Minutes of August 24, 2017 Recommendation: That the Board of Directors approve the regular board meeting minutes of August 24, 2017 as presented. Action (Consent): 4. Approve the Directors' Compensation and Reimbursement of Expenses Recommendation: That the Board of Directors approve the compensation and reimbursement of expenses as presented. Action (Consent): 5. Approve Payroll Transparency Disclosure for August 2017 Recommendation: That the Board of Directors approve and file the report. Action (Consent): 6. Accept the occupancy count as presented as 22,518 and direct staff to prepare a warrant to CR&R Environmental Services for $220,572.82 for August 2017 collection Recommendation: That the Board of Directors accepts the occupancy count as presented using 22,518 as the correct number of active units and directs staff to prepare a warrant to CR&R Environmental Services for August 2017 collection based on this occupancy report so long as the contractor fulfills the obligations of the agreement in the amount of $220,572.82 to be ratified in the September 2017 warrant list. Action (Consent): 7. Receive and file CCTV (Closed Circuit TV) Program Report Recommendation: That the Board of Directors receive and file the report. Action (Consent): 9. Receive and File Annual Report of Expenses- Fiscal Year 2016-17 Recommendation: That the Board of Directors receive and file the Annual Report of Expenses for the Fiscal Year 2016-17. Action (Consent): 10. Adopt Warrant Resolution No. CMSD 2018-03 Approving District Warrant Registers in the amount of $485,582.37 Recommendation: That the Board of Directors adopt Warrant Resolution No. CMSD 2018-03 approving District warrants for the month of August 2017 in the amount of $485,582.37. Action (Consent): 11. Approve the preparation of a warrant to CR Transfer in the amount of $221,343.57 for August 2017 recycling and disposal services in the September 2017 warrant register Recommendation: That the Board of Directors approves the preparation of a warrant to CR Transfer in the amount of $221,343.57 for August 2017 recycling and disposal services to be ratified in the September 2017 warrant register. Action (Consent): 12. Approve Investment Report for the Month of August 2017 Recommendation: That the Board of Directors approve the Investment Report for the month of August 2017. President Scheafer noted that a request was made to pull Item #8 from the Consent Calendar for discussion. Motion: That the Board of Directors pull item #8 for discussion and approve the remainder of the Consent Calendar as presented. Motion by Jim Ferryman, second by Arlene Schafer. Final Resolution: Motion Carries 4-0-1 with Assistant Secretary Ooten absent Aye: Arlene Schafer, Art Perry, Jim Ferryman, Mike Scheafer Action: 8. Receive and File Fiscal Year 2016-2017 Annual Compliance Report for Requirements of Government Code Section 66013 (d) for Capacity Charges. Recommendation: That the Board of Directors receive and file this report. 10/20/2017 BoardDocs® Pro https://www.boarddocs.com/ca/cmsdca/Board.nsf/Private?open&login#15/49 Jim Mosher, a resident, made comments regarding the City of Newport Beach's handling of sewer capacity charges and questioned why a negative interest of $3,715 appears on the attached Annual Compliance Report for Capacity Charges. Finance Manager, Wendy Davis, noted that the negative interest is the result of an accounting mechanism to capture the fair market value and net interest of the District's investments at a given time. She explained that the fair market value of the District's investments has decreased since last year, but the decrease is never realized because the District holds investments until their maturity. Motion: That the Board of Directors receive and file this report. Motion by Art Perry, second by Jim Ferryman. Final Resolution: Motion Carries 4-0-1 with Assistant Secretary Ooten absent Aye: Arlene Schafer, Art Perry, Jim Ferryman, Mike Scheafer There was no further discussion and the Board of Directors approved the Consent Calendar as presented. C. PUBLIC HEARINGS None at this time. D. GENERAL MANAGER'S REPORTS Action: 1. Consider contributing $500 to Costa Mesa High School Football Boosters for Stadium Banner Recommendation: That the Board of Directors: 1. Establish the purpose CMSD is trying to serve as a contributor to the Costa Mesa High School Football Boosters; and 2. Describe how the expenditure will advance CMSD’s purpose; and 3. Consider contributing $500 to continue hanging an Organics Recycling Program banner at Mustangs Field. Management Analyst I, Gina Terraneo, presented the Contribution Application request for a monetary contribution of $500 to hang a promotional banner in Costa Mesa High School's Mustangs Field. President Scheafer indicated agreement with the staff recommendation to continue hanging a banner in Mustangs Field, rather than changing the banner location. Director Perry commented that the banners at Mustangs Field seem to be spaced out on the stadium fence, unlike the banners at Estancia High School, making them more visible. President Scheafer noted that the banner promotes the Organics Recycling Program and gives residents the District's contact information. Vice President Ferryman requested clarification regarding the pricing and quantity of the banners. Director Perry noted that residents will also see the banner during track events. Discussion followed regarding the position of last year's stadium banner. Motion: To contribute $500 to continue hanging a banner at Mustangs Field for the purpose of promoting the Organics Recycling Program and increasing the District's solid waste diversion rate. Motion by Art Perry, second by Arlene Schafer. Final Resolution: Motion Carries 4-0-1 with Assistant Secretary Ooten absent Aye: Arlene Schafer, Art Perry, Jim Ferryman, Mike Scheafer The Board of Directors directed staff to continue hanging a banner at Mustangs Field for the purpose of promoting the Organics Recycling Program and increasing the District's solid waste diversion rate. There were no further questions or discussion. Action: 2. CR&R Contract Negotiations - Update Recommendation: That the Board of Directors provide direction to staff. General Manager, Scott Carroll, presented report details regarding the District's contract negotiations with CR&R. He noted that CR&R has agreed to the following points: a fixed term limit of ten years with two five-year extension options to replace the evergreen clause of the contract, a District-wide door-to-door household hazardous waste (HHW) collection service, an annual free mulch giveaway event, an annual reimbursement of $35,000 (along with Consumer Price Index increases) for various solid waste programs, a public outreach program to help the District achieve 75% diversion, roll-out assistance to seniors and disabled residents without requested proof of age or disability, and a total of two possible requests for Consumer Price Index 10/20/2017 BoardDocs® Pro https://www.boarddocs.com/ca/cmsdca/Board.nsf/Private?open&login#16/49 increases by CR&R per year that must be approved by the Board of Directors prior to implementation. Mr. Carroll added that CR&R did not agree to the following points: use of the Newport Beach Transfer Station, access to CR&R's GPS system on District computers, and lowering the Organics Recycling rate in relation to the Second Amendment of the contract. He noted that the City of Stanton negotiated an Organics Recycling Program with CR&R at no cost to residents and cited the District's contract with CR&R which states that, "if CONTRACTOR [CR&R] negotiates a lower rate with any Orange County agency, then that rate shall become the rate of the DISTRICT." Mr. Carroll shared that CR&R declined the District's suggested compromise of lowering the District's Organics Recycling rate to $55.50 per ton for three years. Lastly, he presented the following options for the Board of Directors: to do nothing and continue with the existing contract, direct staff to send CR&R a cancellation notice to be effective September 20, 2023 and prepare a Request for Proposal for qualified solid waste companies in 2021, direct District Counsel to review the Second Amendment of the contract to determine if a breach of contract occurred, direct staff to continue negotiating with CR&R, or accept the deal points agreed upon and direct staff to bring back a new contract for approval. Director Perry requested clarification regarding the annual free mulch giveaway event and the current door-to-door HHW program. Secretary Schafer asked if staff presented any other proposed compromises besides the lower Organics Recycling rate of $55.50 per ton for three years. Mr. Carroll responded that there were no other proposals made. Vice President Ferryman commented that he would like to see CR&R cooperate with what is stated in the contract. President Scheafer indicated agreement with Vice President Ferryman. Dean Ruffridge of CR&R commented that CR&R did not negotiate a lower rate with the City of Stanton and indicated that he does not believe there is a breach of contract. Vice President Ferryman suggested that this item be discussed in further detail at a future study session. President Scheafer indicated agreement. Mr. Carroll suggested that the District hire a consultant to look into Stanton's rate structure. Discussion followed regarding the cost of hiring a consultant. Mr. Ruffridge suggested that the Board of Directors direct District Counsel, Alan Burns, to review the Second Amendment of the contract to determine if a breach of contract occurred. The Board of Directors directed District Counsel, Alan Burns, to review the Second Amendment of the contract to determine if a breach of contract occurred and for staff to bring this item back to the October 10 Study Session for further discussion. There were no further questions or discussion. E. ENGINEER'S REPORTS Action, Receive and File: 1. Receive and File Capital Improvement Projects Status Report Recommendation: That the Board of Directors receive and file this report. District Engineer, Robin Hamers, presented report details and noted that two projects were finalized last month. He added that the plans for the Yard expansion are in plan check with the City of Costa Mesa. Vice President Ferryman noted that there was an inquiry about the proposed landscaping for the Yard expansion during the Liaison Committee Meeting. Mr. Carroll noted that there are currently several city trees on the property. There were no other questions or discussion and the report was received. F. TREASURER'S REPORTS None at this time. G. ATTORNEY'S REPORTS None at this time. 10/20/2017 BoardDocs® Pro https://www.boarddocs.com/ca/cmsdca/Board.nsf/Private?open&login#17/49 H. LOCAL MEETINGS: In accordance with AB 1234 (Gov. Code 53232.3), a report is required to be given by a Director for any meeting for which expense reimbursement of any kind is provided. Note: For meetings for which the per diem compensation is sought, the Operations Code provides that such compensation is authorized for each day’s service rendered as a Director at the request of the Board (not to exceed six days in one month), and certain meetings are specified as being eligible as set forth in District Operations Code § 3.01.030. For meetings not so listed, the Board must approve the service for it to be eligible for the per day compensation. Discussion: 1. Orange County Sanitation District (OCSD) - (Vice President Ferryman) Vice President Ferryman noted that there will be an OCSD meeting next week. Discussion: 2. Santa Ana River Flood Protection Agency (SARFPA) - (Director Perry) Director Perry noted that there will be a SARFPA meeting next week. Discussion: 3. Independent Special Districts of Orange County (ISDOC) - (President Scheafer) President Scheafer shared that he attended the Executive Committee Meeting earlier this month. He indicated uncertainty of the direction of ISDOC under its current leadership. Discussion: 4. California Special Districts Association (CSDA) - (Secretary Schafer) Secretary Schafer shared that CSDA is preparing for their upcoming conference and that she is running for Vice President of CSDA. Discussion: 5. Special District Risk Management Authority (SDRMA) - (President Scheafer) President Scheafer noted that there is no SDRMA meeting this month. Discussion: 6. Other Meetings Qualifying for Reimbursement under CMSD Ordinance No. 55, Operations Code Section 3.01.030 Director Perry shared that he, Secretary Schafer, and Assistant Secretary Ooten attended the Water Advisory Committee of Orange County (WACO) meeting. He noted that there was discussion of Orange County's water supply, SB 623, and water storage plans. President Scheafer commented that the September 15 Liaison Committee was productive. Discussion followed regarding the City of Costa Mesa's Arlington Drive Bioswale. I. OLD BUSINESS None at this time. J. NEW BUSINESS None at this time. K. ORAL COMMUNICATIONS AND DIRECTOR COMMENTS President Scheafer thanked staff. Director Perry noted that there was discussion of the public restroom project during the Liaison Committee Meeting. He suggested that an item be placed on a future study session agenda about the potential pilot program. General Manager, Scott Carroll, shared that he suggested a mobile restroom option to the City of Costa Mesa's Homeless Task Force. He noted that staff is coordinating a meeting with representatives from each agency within the Liaison Committee to discuss cost and logistics. Secretary Schafer commented that more information is needed before the District commits to participating in a public restroom pilot program. L. ADJOURN TO CLOSED SESSION No closed session. 10/20/2017 BoardDocs® Pro https://www.boarddocs.com/ca/cmsdca/Board.nsf/Private?open&login#18/49 M. RECONVENE TO OPEN SESSION No closed session. N. CLOSING ITEMS Procedural: 1. Adjourn President Scheafer adjourned the meeting at 6:31 P.M. File Attachments minutes_2017_9_21_rm.pdf (60 KB) 10/20/2017 BoardDocs® Pro https://www.boarddocs.com/ca/cmsdca/Board.nsf/Private?open&login#19/49 B. CONSENT CALENDAR a. Directors' compensation for the month of November 2016 b. Directors' reimbursement of expenses for the month of November 2016 File Attachments A - DIRECTORS' COMPENSATION.pdf (860 KB) B - DIRECTORS' REIMBURSEMENT OF EXPENSES.pdf (3,608 KB) Subject 4. Approve the Directors' Compensation and Reimbursement of Expenses Meeting Oct 26, 2017 - Board of Directors Regular Meeting Access Public Type Action (Consent) Recommended Action That the Board of Directors approve the compensation and reimbursement of expenses as presented. 10/20/2017 BoardDocs® Pro https://www.boarddocs.com/ca/cmsdca/Board.nsf/Private?open&login#20/49 B. CONSENT CALENDAR File Attachments WARRANT RESO 2018 OctMtg.pdf (375 KB) Subject 5. Adopt Warrant Resolution No. CMSD 2018-04 Approving District Warrant Registers Meeting Oct 26, 2017 - Board of Directors Regular Meeting Access Public Type Action (Consent) Recommended Action That the Board of Directors adopt Warrant Resolution No. CMSD 2018-04 approving District warrants for the month of September 2017 in the amount of $2,869,285.87. Goals 7.0 Finance 10/20/2017 BoardDocs® Pro https://www.boarddocs.com/ca/cmsdca/Board.nsf/Private?open&login#21/49 B. CONSENT CALENDAR Summary Attached is the Payroll General Ledger Distribution Report summarizing each payroll during the month. Legal Review Not Applicable Environmental Review Subject activity is exempt from the requirements of the California Environmental Quality Act (CEQA) (Public Resources Code Section 21000 et. seq.). Section 15300.4 of CEQA allows an agency while establishing its own procedures “to list those specific activities which fall within each of the exempt classes”, and the District has adopted “CEQA Guidelines and Implementing Procedures” that state on page 6 “”Projects” does not include …. C. Continuing administrative or maintenance activities.” Financial Review Sufficient funds are available in the adopted budget. Public Notice Process Copies of this report are on file and will be included with the complete agenda packet for the October 26, 2017 Board of Directors Regular meeting at District Headquarters and posted on the District’s website www.cmsdca.gov Alternative Actions Refer item back to staff with further instructions. File Attachments Payroll Transparency Disclosure Sept 2017.pdf (926 KB) Subject 6. Approve Payroll Transparency Disclosure for September 2017 Meeting Oct 26, 2017 - Board of Directors Regular Meeting Access Public Type Action (Consent) Recommended Action That the Board of Directors approve and file the report. Goals 7.0 Finance 10/20/2017 BoardDocs® Pro https://www.boarddocs.com/ca/cmsdca/Board.nsf/Private?open&login#22/49 B. CONSENT CALENDAR Summary This payment to CR Transfer is for the sorting of recyclables from the mixed waste and disposal of the remaining waste at the landfill. With the implementation the Organics Recycling Program adopted by the Board, this payment also includes the diverting of the organics waste to the Anaerobic Digestion facility to be recycled into fertilizer or renewable natural gas to fuel the refuse trucks. Recommendation That the Board of Directors approve the preparation of a warrant to CR Transfer in the amount of $196,985.21 for September 2017 recycling and disposal services to be ratified in the October 2017 warrant register. Analysis Below is a chart depicting the total tonnage and payments due for residential and organic waste collected in Costa Mesa and Newport Beach. Please note there was a discrepancy with billing this month, CR&R's billing system inaccurately calculated invoice totals and under billed us $62.28 but CMSD will be paying what is reflected in the invoice. Costa Mesa Newport Beach Total Residential Waste $132,886.71 $3,994.43 $136,881.14 Organics $57,295.81 $2,808.26 $60,104.07 Total Payment $196,985.21 Tonnage Residential Waste 2557.64 76.88 2634.52 Organics 801.34 39.52 840.86 Total Tonnage 3475.38 Legal Review Not Applicable Environmental Review Subject activity is exempt from the requirements of the California Environmental Quality Act (CEQA) (Public Resources Code Section 21000 et. seq.). Section 15300.4 of CEQA allows an agency while establishing its own procedures “to list those specific activities which fall within each of the exempt classes”, and the District has adopted “CEQA Guidelines and Implementing Procedures” that state on page 6 “”Projects” does not include …. C. Continuing administrative or maintenance activities.” Financial Review Sufficient funds are available in the adopted budget to pay for the services provided. Public Notice Process Copies of this report are on file and will be included with the complete agenda packet for the October 26, 2017 Board of Directors regular meeting at District Headquarters and posted on the District’s website at www.cmsdca.gov. Subject 7. Approve the preparation of a warrant to CR Transfer in the amount of $196,985.21 for September 2017 recycling and disposal services in the October 2017 warrant register Meeting Oct 26, 2017 - Board of Directors Regular Meeting Access Public Type Action (Consent) Preferred Date Oct 26, 2017 Absolute Date Oct 26, 2017 Recommended Action Approve the preparation of a warrant to CR Transfer in the amount of $196,985.21 for September 2017 recycling and disposal services to be ratified in the October 2017 warrant register. 10/20/2017 BoardDocs® Pro https://www.boarddocs.com/ca/cmsdca/Board.nsf/Private?open&login#23/49 Alternative Actions Refer item back to staff with further instructions. 10/20/2017 BoardDocs® Pro https://www.boarddocs.com/ca/cmsdca/Board.nsf/Private?open&login#24/49 B. CONSENT CALENDAR Summary The occupancy count is the number of residential customers that the District pays CR&R for the trash truck to stop and pick-up trash. The District pays CR&R $9.7954 per occupant per month. Each month, new residential customers in brand new developments contact the District to establish new trash service. District staff contacts CR&R to approve the drop-off of carts at the residence, which results in an increase in the occupancy count as shown on the attached list. Over the years, some discrepancies have occurred in the number of total occupancies. District staff has been working with CR&R to reconcile the entire list of service addresses for the past few months. While this process in underway, the District and CR&R have agreed to freeze the occupancy count at the March 2017 level. District staff will continue to track the number of new service addresses, but the District will only pay for the total occupancy count of 22,518 until the total address list is verified. Eighteen (18) accounts have been added since the last billing period. The payment calculation is based on the following: District's Current Rate for September of 2017: 22,518 x $9.7954 = $220,572.82 Recommendation That the Board of Directors accept the occupancy count as presented using 22,518 as the correct number of active units and direct staff to prepare a warrant to CR&R Environmental Services for September 2017 collection based on this occupancy report so long as the contractor fulfills the obligations of the agreement in the amount of $220,572.82 to be ratified in the October 2017 warrant list. Analysis Accept the occupancy count as presented using 22,518 as the correct number of active units and direct staff to prepare a warrant to CR&R Environmental Services for September 2017 collection based on this occupancy report so long as the contractor fulfills the obligations of the agreement in the amount of $220,572.82 to be ratified in the October 2017 warrant list. Legal Review Not Applicable Environmental Review Subject activity is exempt from the requirements of the California Environmental Quality Act (CEQA) (Public Resources Code Section 21000 et. seq.). Section 15300.4 of CEQA allows an agency while establishing its own procedures “to list those specific activities which fall within each of the exempt classes”, and the District has adopted “CEQA Guidelines and Implementing Procedures” that state on page 6 “”Projects” does not include …. C. Continuing administrative or maintenance activities.” Financial Review Sufficient funds are available in the adopted budget to pay for the services provided. Public Notice Process Subject 8. Accept the occupancy count as presented as 22,518 and direct staff to prepare a warrant to CR&R Environmental Services for $220,572.82 for September 2017 collection Meeting Oct 26, 2017 - Board of Directors Regular Meeting Access Public Type Action (Consent) Preferred Date Oct 26, 2017 Absolute Date Oct 26, 2017 Recommended Action Accept the occupancy count as presented using 22,518 as the correct number of active units and direct staff to prepare a warrant to CR&R Environmental Services for September 2017 collection based on this occupancy report so long as the contractor fulfills the obligations of the agreement in the amount of $220,572.82 to be ratified in the October 2017 warrant list. Goals 2.2 Annual Contract Audits 2.4 Develop Strategies for 75% Waste Diversion 10/20/2017 BoardDocs® Pro https://www.boarddocs.com/ca/cmsdca/Board.nsf/Private?open&login#25/49 Copies of this report are on file and will be included with the complete agenda packet for the October 26, 2017 Board of Directors Regular meeting at District Headquarters and posted on the District’s website. Alternative Actions Refer item back to staff with further instructions. File Attachments CMSD Occupancy Report September 2017.pdf (142 KB) 10/20/2017 BoardDocs® Pro https://www.boarddocs.com/ca/cmsdca/Board.nsf/Private?open&login#26/49 B. CONSENT CALENDAR Summary The following is a summary of the CCTV (Closed Circuit TV) Pilot Program activity for the 2017-2018 fiscal year as of September 30, 2017: Adopted CCTV Budget $50,000 FY 16-17 Carryover Budget 0 Total Budget $50,000 FY 17-18 New Applications Received = 52 Applications Processed for Payment = 20 $ 4,200 Applications In Process = 32 8,000 Available Spots Based on Funding = 152 37,800 Total Projected Cost $50,000 Legal Review Not applicable Environmental Review Subject activity is exempt from the requirements of the California Environmental Quality Act (CEQA) (Public Resources Code Section 21000 et. seq.). Section 15300.4 of CEQA allows an agency while establishing its own procedures “to list those specific activities which fall within each of the exempt classes”, and the District has adopted “CEQA Guidelines and Implementing Procedures” that state on page 6 “”Projects” does not include …. C. Continuing administrative or maintenance activities.” Financial Review Sufficient funds are available in the adopted budget to pay for the services provided. Public Notice Process Copies of this report are on file and will be included with the complete agenda packet for the October 26, 2017 Board of Directors regular meeting at District Headquarters and posted on the District’s website at www.cmsdca.gov. Alternative Actions Refer item back to staff with further instructions. Subject 9. Receive and file CCTV (Closed Circuit TV) Program Report Meeting Oct 26, 2017 - Board of Directors Regular Meeting Access Public Type Action (Consent) Recommended Action That the Board of Directors receive and file the report. Goals 1.9 Sewer Lateral Assistance Program (SLAP) 10/20/2017 BoardDocs® Pro https://www.boarddocs.com/ca/cmsdca/Board.nsf/Private?open&login#27/49 D. GENERAL MANAGER'S REPORTS Summary On May 28, 2015, the Board of Directors adopted the 2015-2020 Strategic Plan, which is a plan that establishes goals, objectives, strategies and work plans for the next five years and will help move the organization in a direction toward achieving its mission and vision. Attached is the quarterly update that demonstrates the progress staff is making toward achieving the strategic goals. Recommendation That the Board of Directors receive and file this report. Analysis 19 out of the 48 strategic goals (Strategic Goal 1.10 was cancelled) are complete. Several goals are on-going, but staff is making good progress on fulfillment (e.g. 1.4, 1.5, 1.7, 1.8, 1.9, 2.3, 2.7, 3.2, 3.4, 6.1, 6.3, 6.7 and 7.6). The next quarterly update will be presented to the Board on January 26, 2018. Legal Review Not applicable. Environmental Review The District’s Strategic Plan is a planning document and preparation and adoption of the plan itself is an administrative matter and is not a disturbance of the environment similar to grading or construction and is not a project under CEQA or the District’s CEQA Guidelines. The environmental review of each of the efforts or projects outlined in the Strategic Plan will occur when the Board of Directors specifically considers each of the items since that is when the full scope of work of each effort or project will be described. Financial Review Activities described in the strategic goals are funded in the budget. Public Notice Process Copies of this report are on file and will be included with the entire agenda packet for the October 26, 2017 Board of Directors regular meeting at CMSD headquarters (290 Paularino Avenue) and on CMSD's website at www.cmsdca.gov. Alternative Actions 1. Direct staff to report back with more information. File Attachments Qtly Progress Rpt 2017-18 - 1st Qtr.pdf (291 KB) Subject 1. Receive and File FY 2015-20 Strategic Plan Quarterly Update - 1st Quarter Meeting Oct 26, 2017 - Board of Directors Regular Meeting Access Public Type Discussion, Receive and File Goals 1.0 Sewer Infrastructure 2.00 Solid Waste 3.00 Partnerships 4.0 Community Outreach & Communications 5.0 Administrative Management 6.0 Personnel/Organizational Management 7.0 Finance 10/20/2017 BoardDocs® Pro https://www.boarddocs.com/ca/cmsdca/Board.nsf/Private?open&login#28/49 D. GENERAL MANAGER'S REPORTS Summary The District requires incumbents in the Wastewater Maintenance classifications to maintain a valid California Class "B" driver's license with the appropriate endorsements. The District does not currently offer benefit pay to employees for maintaining their license in good standing. However, several other local agencies do offer this benefit. Staff is proposing that the Board of Directors approve benefit pay of $260 annually to employees in the Wastewater Maintenance classifications who maintain a valid Commercial Driver's License. Analysis The District requires employees in the Wastewater Maintenance Worker classifications to maintain a valid California Class "B" driver's license with the appropriate endorsements. These classifications include: Wastewater Maintenance Superintendent Wastewater Maintenance Supervisor Wastewater Maintenance Worker III Wastewater Maintenance Worker II Wastewater Maintenance Worker I The District does not currently compensate employees for maintaining a Class "B" license in good standing. Staff surveyed other surrounding agencies and found that there are several that offer this benefit. AGENCY DRIVER"S LICENSE CLASS ANNUAL BENEFIT City of Anaheim Class "A"$300 City of Costa Mesa Class "A" or "B"$700 City of Newport Beach Class "A" Class "B" $220 $165 City of San Juan Capistrano Class "A"$100 Irvine Ranch Water District Class "A" or "B"$200 Santa Margarita Water District Class "A" Class "B" $1,500 $500 Providing this benefit pay to employees who are required to maintain a class "B" license will enable the District to remain competitive in the area of benefits, which impacts employee satisfaction and retention, as well as helps in attracting future applicants. Staff is proposing that the District pay employees who are required to maintain a commercial driver's license for the performance of their assigned job duties, the amount of $260 annually, to be paid on a per-pay period basis of $10 for each pay period the license is in good standing. If this benefit pay is approved by the Board of Directors, it will take effect the pay period beginning 10/27/2017. Legal Review No legal review is required for adding Commercial Driver's License Pay to Policy Number 2.2 - Classification and Compensation. Subject 2. Consider Approving Commercial Driver's License Pay Meeting Oct 26, 2017 - Board of Directors Regular Meeting Access Public Type Action Fiscal Impact Yes Dollar Amount $1,560.00 Budgeted No Recommended Action That the Board of Directors approve benefit pay for Wastewater Maintenance classifications that are required to maintain a valid California Commercial Driver's License for the performance of their assigned job duties. Goals 6.0 Personnel/Organizational Management 6.7 Promote high employee satisfaction 10/20/2017 BoardDocs® Pro https://www.boarddocs.com/ca/cmsdca/Board.nsf/Private?open&login#29/49 Environmental Review The consideration of adding Commercial Driver's License Pay is an administrative matter and is not a disturbance of the environment similar to grading or construction and does not constitute a project under CEQA or the District's CEQA guidelines. Financial Review The District currently has six employees who serve in the Wastewater Maintenance classifications that would be impacted by the Commercial Driver's License Pay benefit. The cost to the District for providing this additional benefit is $260 per employee per year. The total annual cost for all employees would be $1,560 plus a small increase in CalPERS neither of which was included in the adopted budget. If approved by the Board, staff will request approval from the General Manager to transfer from Contingency account in the Wastewater Fund to cover the additional expense. Under the Operations Code Section 4.03.010 (h) the General Manager has the authority to transfer up to fifty thousand dollars ($50,000) from savings, from account to account or between personnel, maintenance & operations and capital outlay unless otherwise prohibited by law. Funds shall not be transferred between the solid and liquid waste funds. Transfers over fifty thousand dollars must be approved by the Board of Directors. (Ord. 82, 2011). Public Notice Process Copies of this report are on file and will be included with the complete agenda packet for the October 26, 2017 Board of Directors meeting at District Headquarters and posted on the District's website. Alternative Actions 1. Do not approve adding the Commercial Driver's License Pay to the District's Class and Compensation policy. File Attachments Class B - DL Incentive Pay Survey.pdf (66 KB) 2.2 - Classification & Compensation.pdf (149 KB) 10/20/2017 BoardDocs® Pro https://www.boarddocs.com/ca/cmsdca/Board.nsf/Private?open&login#30/49 D. GENERAL MANAGER'S REPORTS Summary Staff received a Contribution Program Eligibility Application from the Costa Mesa Chamber of Commerce seeking a monetary contribution of $1,000 to support the Costa Mesa Public Safety Recognition Celebration Event in January 2018. Recommendation That the Board of Directors: 1. Establish the purpose CMSD is trying to serve as a contributor to the Costa Mesa Public Safety Recognition Celebration Event; and 2. Describe how the expenditure will advance CMSD’s purpose. Analysis According to the procedures implemented on July 31, 2013, the Board of Directors must do the following in order to determine if a contribution should be made: Establish the purpose the District is trying to serve by contributing. This purpose must be established as one of the District’s statutory powers or a power that would be incidental to those purposes. For example, District purposes include properly treating sewage, preventing SSOs, and recycling. Describe how the contribution will advance the District's purpose. The application submitted does not identify how the event will benefit CMSD nor how it will advance CMSD's purpose. The application states that a contribution to this event will demonstrate CMSD's loyalty to the City of Costa Mesa and to City heroes, such as the men and women serving in the City's Police and Fire Departments. Without identifying a benefit and describing how the $1,000 will advance CMSD's purpose the monetary contribution could be considered a gift of public funds. Legal Review Not applicable. Environmental Review The consideration of a monetary contribution to a non-profit organization to be used as a vehicle for promoting a District recycling program is an administrative matter and is not a disturbance of the environment similar to grading or construction and is not a project under CEQA or the District’s CEQA Guidelines. Financial Review Currently, there is $2,500 available in the FY 2017-18 Public Information/Education/Community Promotions Sponsorships account. A total of $8,000 is budgeted for sponsorships in FY 2017-2018. Public Notice Process Copies of this report are on file and will be included with the complete agenda packet for the October 26, 2017 Board of Directors regular meeting at District Headquarters and posted on the District’s website. Subject 3. Consider Approving the Costa Mesa Chamber of Commerce Contribution Application for Costa Mesa Public Safety Recognition Celebration Event Meeting Oct 26, 2017 - Board of Directors Regular Meeting Access Public Type Action Fiscal Impact Yes Dollar Amount $1,000.00 Budgeted Yes Recommended Action That the Board of Directors: 1. Establish the purpose CMSD is trying to serve as a contributor to the Costa Mesa Public Safety Recognition Celebration Event; and 2. Describe how the expenditure will advance CMSD’s purpose. Goals 3.00 Partnerships 3.5 Participate in community groups and civic organization activities 3.6 Strengthen our ties with emergency service providers 10/20/2017 BoardDocs® Pro https://www.boarddocs.com/ca/cmsdca/Board.nsf/Private?open&login#31/49 Alternative Actions 1. Do not approve a monetary contribution to the Costa Mesa Public Safety Recognition Celebration Event 2. Approve a contribution in a lessor amount of $1,000. 3. Approve a non-monetary contribution such as reusable grocery bags. 4. Request the Costa Mesa Chamber of Commerce submit a new application that identifies and describes how a monetary contribution to the Costa Mesa Public Safety Recognition Celebration event will benefit CMSD and advance it's purpose. 4. Refer the matter back to staff. File Attachments CM Chamber of Commerce Contribution Application.pdf (1,235 KB) 10/20/2017 BoardDocs® Pro https://www.boarddocs.com/ca/cmsdca/Board.nsf/Private?open&login#32/49 D. GENERAL MANAGER'S REPORTS Summary This report serves as a summary of the District’s spending through September 30, 2017 as well as staff’s best estimate of projected balances for the year-ended June 30, 2018. Analysis Based on the limited spending trends through September 30, 2017, staff is projecting to be on target in both the Solid Waste and Wastewater Funds. Please note, however, that projections with only three months or less of activity as the basis should not be relied upon. At this time of the year staff typically anticipates appropriations to be on budget at year-end. As the year progresses, these projections with become more precise. As of September 30, 2017, a total of 17.2% of the Solid Waste budget and a total of 43.1% of the Wastewater Fund’s operating budget for the 2017-18 fiscal year has been expended. The purchase of the property 2252 Fairview Road is included in this quarter expenses. Staff anticipates no budgetary savings at fiscal year-end. Please see the attached report for a more detailed analysis. Legal Review Not applicable. Environmental Review Subject activity is exempt from the requirements of the California Environmental Quality Act (CEQA) (Public Resources Code Section 21000 et. seq.). Section 15300.4 of CEQA allows an agency while establishing its own procedures “to list those specific activities which fall within each of the exempt classes”, and the District has adopted “CEQA Guidelines and Implementing Procedures” that state on page 6 “”Projects” does not include …. C. Continuing administrative or maintenance activities.” Financial Review See attached report. Public Notice Process Copies of this report are on file and will be included with the entire agenda packet for the October 26, 2017 Board of Directors regular meeting at District Headquarters and on District website. Alternative Actions 1. Refer the matter back to staff for additional information. Attachments A: FY 2017-18 First Quarter Budget Analysis B: Expenditure Analysis through 9/30/2017 File Attachments A- FY2017-18 First Quarter Budget Analysis.pdf (39 KB) B- Expenditure Analysis through 09-30-2017.pdf (233 KB) Subject 4. Receive and File the First Quarter Budget Review for FY 2017-18. Meeting Oct 26, 2017 - Board of Directors Regular Meeting Access Public Type Action Recommended Action That the Board of Directors receive and file this report. Goals 7.0 Finance 10/20/2017 BoardDocs® Pro https://www.boarddocs.com/ca/cmsdca/Board.nsf/Private?open&login#33/49 D. GENERAL MANAGER'S REPORTS Summary All appropriations lapse at the end of each fiscal year, therefore it is necessary to request that certain unspent appropriations and encumbrances for goods and/or services that have yet to be completed by fiscal year end be carried over into the subsequent fiscal year. After the close of the prior fiscal year, the Board of Directors reviews and approves a list of appropriations and encumbrances that are requested to be carryover in to the new fiscal year. Recommendation That the Board of Directors approve the re-appropriation of funds in the Fiscal Year 2017-18 for the carryover items from the prior fiscal year as detailed in Attachments A and B, and summarized as follows: 10 Solid Waste Fund: Carryover Appropriations $15,000, Encumbrances $0 20 Wastewater Fund: Carryover Appropriations $1,858,225, Encumbrances $101,301 Analysis All appropriations lapse at the end of each fiscal year, therefore it is necessary to request that certain unspent appropriations for goods and/or services be carried over into the subsequent fiscal year. The carryover appropriations represent budgeted Fiscal Year 2016- 17 appropriations for goods and/or services that were not expended as of June 30, 2017, but are expected to be expended in the Fiscal Year 2017-18. Generally, allowable carryovers are limited to certain types of goods or services, such as professional service contracts, capital outlay or capital improvement projects (CIP). Due to their scope and size, CIP is inherently precluded from being completed within the fiscal year in which funding was initially appropriated. The carryover of operating transfers represents the use of specific resources to fund specific carryover appropriations. The carryover of revenues typically relates to grants where the money has been received but not earned. Encumbrances represent purchase orders (POs) issued for goods and/or services which were not received or completed during the prior fiscal year by June 30, 2017. A PO is a commitment created to reserve a portion of the appropriation’s available balance, but does not represent an expenditure or liability for budgetary or accounting purposes. The budget appropriations associated with encumbrance’s lapse at fiscal year-end unless the Board re-appropriates the funds in the subsequent fiscal year as requested in this report. After all payments are made for goods and services received by June 30, 2017, staff analyzes the remaining appropriation balances and open encumbrances to determine their validity. If the proposed continuing appropriations and encumbrances were not carried over into Fiscal Year 2017-18, there would not be sufficient appropriations in the current year budget to fund existing and the current year adopted projects. Legal Review Not applicable Environmental Review Subject activity is exempt from the requirements of the California Environmental Quality Act (CEQA) (Public Resources Code Section 21000 et. seq.). Section 15300.4 of CEQA allows an agency while establishing its own procedures “to list those specific activities which fall within each of the exempt classes”, and the District has adopted “CEQA Guidelines and Implementing Procedures” that state on page 6 “”Projects” does not include …. C. Continuing administrative or maintenance activities.” Financial Review Subject 5. Carryover Appropriations and Carryover Encumbrances from Fiscal Year 2016-17 to Fiscal Year 2017-18 Meeting Oct 26, 2017 - Board of Directors Regular Meeting Access Public Type Action Recommended Action That the Board of Directors approve the re-appropriation of funds in the Fiscal Year 2017-18 for the carryover items from the prior fiscal year as detailed in Attachments A and B, and summarized as follows: 10 Solid Waste Fund Carryover Appropriations $15,000, Encumbrances $0 20 Wastewater Fund Carryover Appropriations $1,858,225, Encumbrances $101,301 Goals 7.0 Finance 10/20/2017 BoardDocs® Pro https://www.boarddocs.com/ca/cmsdca/Board.nsf/Private?open&login#34/49 The total amount to be carried over for Solid Waste Fund is $15,000. The total amount to be carried over for Wastewater Fund is $1,959,526. Public Notice Process Copies of this report are on file and will be included with the entire agenda packet for the October 26, 2017 Board of Directors regular meeting at District Headquarters and on District’s website www.cmsdca.gov Alternative Actions Refer the matter back to staff File Attachments A - Carryover Appropriations FY16-17 to FY17-18.pdf (83 KB) B - Carryover Encumbrances FY16-17 to FY17-18.pdf (83 KB) 10/20/2017 BoardDocs® Pro https://www.boarddocs.com/ca/cmsdca/Board.nsf/Private?open&login#35/49 D. GENERAL MANAGER'S REPORTS Summary On September 12, 2017 the Board of Directors considered establishing a Citizens Advisory Committee (CAC) that will give citizens an opportunity to get involved in their community while at the same time assist the Board on decision making issues. The Board directed staff to research the City of Costa Mesa's policies and procedures for appointing committee members and then report back with findings. Recommendation That the Board of Directors: 1. Adopts Administrative Policy No. 60.00; 2. Give preliminary approval of the Citizens Advisory Committee Handbook; and 3. Authorize staff to finalize the document after receiving District Counsel edits. Analysis Staff obtained a copy of the City of Costa Mesa's Commission/Committee/Board Member Handbook that provides general information about the City along with an outline of polices, practices and procedures to help guide new commission/committee/board members fulfill their responsibilities. CMSD's Citizens Advisory Committee Handbook, which is attached hereto, mirror's the City's handbook in many ways. Also attached is Administrative Policy No. 60.00 that will establish the CAC if the Board decides to adopt said policy. There were several changes to the policy since it was first presented to the Board on September 12th. The changes include the following: 1. The term of appointment of each CAC member is two staggered years. 2. CAC members term will begin on April 1. 3. A recruitment schedule is established. 4. Appointed CAC members must live within CMSD service area. 5. Appointments will be announced publicly at a regular Board of Directors meeting and each Board member will have an opportunity to recommend at least one applicant for appointment. 6. The President shall designate one member of the Board to serve one year as a non-voting liaison to the CAC. 7. The CAC will determine how many days they need to meet within a 12 month calendar and they will decide on a time for meetings to begin. Establishing a Citizens Advisory Committee can achieve four objectives: 1. Give citizens an opportunity to get involved in their community. 2. Citizens serving on the committee will become knowledgeable about CMSD and how the organization is operating to meet its mission, vision and core values. 3. Citizens can serve as ambassadors to CMSD, helping disseminate information like new and existing programs. 4. Make recommendations to the Board of Directors on key decision making issues. Topics the CAC could discuss include, but are not limited to, the following: New and/or existing solid waste diversion programs Wastewater operations, including pipeline cleaning and pump station maintenance Strategic Plan goals Policies and procedures Finance Subject 6. Consider Adopting a Citizens Advisory Committee Meeting Oct 26, 2017 - Board of Directors Regular Meeting Access Public Type Action Fiscal Impact Yes Recommended Action That the Board of Directors: 1. Adopts Administrative Policy No. 60.00; 2. Give preliminary approval of the Citizens Advisory Committee Handbook; and 3. Authorize staff to finalize the document after receiving District Counsel edits. Goals 4.0 Community Outreach & Communications 10/20/2017 BoardDocs® Pro https://www.boarddocs.com/ca/cmsdca/Board.nsf/Private?open&login#36/49 Community outreach Solid waste and wastewater rates Legal Review District Counsel has begun reviewing the Handbook. Staff is seeking the Board's preliminary approval of the Handbook and then authorizing staff to finalize the document after District Counsel edits. Environmental Review Establishing a citizens advisory committee is not a disturbance of the environment similar to grading or construction and does not constitute a project under CEQA or the District’s CEQA Guidelines. Financial Review There will be expenses for CAC members touring facilities such as CMSD Yard, Orange County Sanitation District wastewater treatment facility, and CR&R's material recovery and anaerobic digestion facilities, and there is sufficient monies budgeted for these activities under the Public info/Education/Community Promotion Account in both the Solid Waste and Wastewater funds. Public Notice Process Copies of this report are on file and will be included with the entire agenda packet for the October 26, 2017 Board of Directors regular meeting at District Headquarters and on District website at www.cmsdca.gov Alternative Actions 1. Do not adopt Administrative Policy No. 60.00. 2. Do not give preliminary approval of the Citizens Advisory Committee Handbook. 3. Establish an ad hoc committee to discuss this matter further. 4. Direct staff to report back with additional information. File Attachments CAC Handbook.pdf (753 KB) AR No. 60.00 - Citizens Advisory Committee.pdf (108 KB) 10/20/2017 BoardDocs® Pro https://www.boarddocs.com/ca/cmsdca/Board.nsf/Private?open&login#37/49 D. GENERAL MANAGER'S REPORTS Summary Davis Farr is providing Treasurer and other financial services to the Costa Mesa Sanitary District. The firm is requesting a rate adjustment ranging from 2.27% to 2.44% Recommendation That the Board of Directors approve Davis Farr request for a rate adjustment and direct the General Manager to execute an amendment to the Agreement between the Costa Mesa Sanitary District and Davis Farr, LLP Analysis Davis Far is providing Treasurer and other financial services to the Costa Mesa Sanitary District. Services being provided from Davis Far include the following: 1. Prepare the annual Statement of Investment Policy. 2. Prepare the monthly Treasurer’s Report. 3. Placing and tracking District investments. 4. Attend agenda review meetings. 5. Attend Board meetings. 6. Serve as a financial resource to the Board. 7. Other projects as may be assigned by the Board or General Manager from time to time. The firm is requesting a rate adjustment ranging from 2.27% to 2.44%. The last rate increase was in 2015 when the Board approved an agreement with Davis Farr on September 17, 2015. The 2017 rate adjustment was approved in the FY 2017-18 & 2018-19 Budgets and CMSD is paying Davis Farr for services rendered under the new rate; however, staff is requesting the Board approve Davis Farr request as a formality. Legal Review District Counsel will review and approve the amendment before it is fully executed. Environmental Review The consideration of contracts with a firm that performs financial services such as investments is not a disturbance of the environment similar to grading or construction and is not a project under CEQA or the District’s CEQA Guidelines. Financial Review There are sufficient funds included in the budget to cover this additional cost, therefore staff is not requesting a additional appropriation. Public Notice Process Copies of this report are on file and will be included with the entire agenda packet for the October 26, 2017 Board of Directors regular meeting at District Headquarters and on District website at www.cmsdca.gov Alternative Actions 1. Do not approve the rate adjustment 2. Refer the matter back to staff. File Attachments Davis Farr Request for Rate Adjustment.pdf (109 KB) Subject 7. Approve Request for Rate Adjustment for Davis Farr, LLP Meeting Oct 26, 2017 - Board of Directors Regular Meeting Access Public Type Action Recommended Action That the Board of Directors approve Davis Farr request for a rate adjustment and direct the General Manager to execute an amendment to the Agreement between the Costa Mesa Sanitary District and Davis Farr, LLP 10/20/2017 BoardDocs® Pro https://www.boarddocs.com/ca/cmsdca/Board.nsf/Private?open&login#38/49 E. ENGINEER'S REPORTS Summary Attached is a summary of the Capital Improvement Project activities during the month. Legal Review Not Applicable. Environmental Review Subject activity is exempt from the requirements of the California Environmental Quality Act (CEQA) (Public Resources Code Section 21000 et. seq.). Section 15300.4 of CEQA allows an agency while establishing its own procedures “to list those specific activities which fall within each of the exempt classes”, and the District has adopted “CEQA Guidelines and Implementing Procedures” that state on page 6 “”Projects” does not include …. C. Continuing administrative or maintenance activities.” Financial Review Sufficient funds are available in the adopted budget. Public Notice Process Copies of this report are on file and will be included with the complete agenda packet for the October 26, 2017 Board of Directors Regular meeting at District Headquarters and posted on the District’s website www.cmsdca.gov Alternative Actions Refer item back to staff with further instructions. File Attachments CIP Updates Oct 2017.pdf (26 KB) Subject 1. Receive and File Capital Improvement Projects Status Report Meeting Oct 26, 2017 - Board of Directors Regular Meeting Access Public Type Action, Receive and File Recommended Action The Board of Directors receive and file this report. Goals 1.4 System Wide Sewer Replacement and Repair Program 1.1 Manhole Cover Maintenance Program 1.0 Sewer Infrastructure 10/20/2017 BoardDocs® Pro https://www.boarddocs.com/ca/cmsdca/Board.nsf/Private?open&login#39/49 F. TREASURER'S REPORTS Summary Attached is the Investment Report for the month of September 2017. As required by the District’s Statement of Investment Policy, the Investment Report delineates all investment activity during the month. Analysis This report lists the types of securities held in the District’s portfolio, the institutions from which the securities were purchased, maturity dates and interest rates as of September 30, 2017. The District’s investments are in compliance with the Statement of Investment Policy adopted by the Board at the June 22, 2017 regular meeting, as well as the California Government Code. The market values in this report were provided by our third party custodian, Pershing, LLC, except for the Local Agency Investment Fund (LAIF). The market value of LAIF was provided by the State Treasurer’s Office. It does not represent the value of the underlying securities within the pool, but rather the par or cost amount, which is the amount the District is entitled to withdraw. This reporting practice is consistent with industry standard practices for similar funds. The weighted average stated rate of return (current yield) for the District’s investment portfolio as of September 30, 2017, was 1.373%. The yield to maturity of the portfolio was 1.378%. The District’s weighted average interest rate was 27 basis points (0.262%) above the LAIF average monthly rate for September 2017 of 1.111%. The weighted average number of days to maturity for the District’s total portfolio was 916 days (2.51 years). The average duration of the underlying securities in LAIF as of September 30, 2017 was 190 days. The District’s investment portfolio is in compliance with its liquidity limitations, which requires that a minimum of 20.00% of the portfolio must mature within one year. The percentage of the portfolio maturing in less than one year as of September 30, 2017 was 27.82%. The District has adequate cash reserves necessary to meet its obligations for the next six months. A majority of the District’s cash and investments is reserved or set aside for specific purposes. A description of the various classifications of the District’s cash and investments are as follows: Classification Description Solid Waste Fund: Operating reserve Equal to 30% of the operations budget of the Solid Waste Fund per Operations Code Section 4.030.020. The Operating Reserve can only be accessed with prior Board approval. Designated for revenue dry period Equal to 5 months of budgeted expenditures for the fiscal year to cover the cash deficit during the period in which the District does not receive any revenue. Undesignated Currently used for rate stabilization and payment of organics recycling costs. Wastewater Fund: Operating reserve Equal to 25% of the operations budget of the Wastewater Fund per Operations Code Section 4.030.020. The Operating Reserve can only be accessed with prior Board approval. Reserved for capital outlay Set aside for capital improvement projects approved and budgeted by the Board, but which have not yet been completed. Designated for revenue dry period Equal to 5 months of budgeted expenditures for the fiscal year to cover the cash deficit during the period in which the District does not receive any revenue. Subject 1. Approve Investment Report for the month of September 2017 Meeting Oct 26, 2017 - Board of Directors Regular Meeting Access Public Type Action Recommended Action Approve Investment Report for the month of September 2017. Goals 7.0 Finance 10/20/2017 BoardDocs® Pro https://www.boarddocs.com/ca/cmsdca/Board.nsf/Private?open&login#40/49 Undesignated Wasterwater funds available to be appropriated by the Board. Facilities Revolving Fund Collection of fixture fees which is a restricted revenue source and can only be used for new sewer facilities. Asset Replacement Fund Accumulation of funds for replacement of vehicles, equipment and computers. Asset Management Fund Accumulation of funds in accordance with asset management model for long-term replacement of sewer pipes and related infrastructure. Legal Review Legal review is not required. Environmental Review Subject activity is exempt from the requirements of the California Environmental Quality Act (CEQA) (Public Resources Code Section 21000 et. seq.). Section 15300.4 of CEQA allows an agency while establishing its own procedures “to list those specific activities which fall within each of the exempt classes”, and the District has adopted “CEQA Guidelines and Implementing Procedures” that state on page 6, “”Projects” does not include….C. Continuing administrative or maintenance activities.” Financial Review The portfolio was budgeted to earn an average rate of 0.900% for the year ending June 30, 2018. Through September 30, 2017, the portfolio has earned a weighted average interest rate of 1.412%. Public Notice Process Copies of this report are on file and will be included with the entire agenda packet for the October 26, 2017 Board of Directors regular meeting at District Headquarters (290 Paularino Avenue) and on the District’s website at www.cmsdca.gov. Alternative Actions Refer the matter back to staff. File Attachments Investment Report - September 2017.pdf (582 KB) 10/20/2017 BoardDocs® Pro https://www.boarddocs.com/ca/cmsdca/Board.nsf/Private?open&login#41/49 G. ATTORNEY'S REPORTS Subject 1. Provide Update on CR&R Agreement Negotiations - Oral Report Meeting Oct 26, 2017 - Board of Directors Regular Meeting Access Public Type Discussion 10/20/2017 BoardDocs® Pro https://www.boarddocs.com/ca/cmsdca/Board.nsf/Private?open&login#42/49 H. LOCAL MEETINGS: In accordance with AB 1234 (Gov. Code 53232.3), a report is required to be given by a Director for any meeting for which expense reimbursement of any kind is provided. Note: For meetings for which the per diem compensation is sought, the Operations Code provides that such compensation is authorized for each day’s service rendered as a Director at the request of the Board (not to exceed six days in one month), and certain meetings are specified as being eligible as set forth in District Operations Code § 3.01.030. For meetings not so listed, the Board must approve the service for it to be eligible for the per day compensation. Subject 1. Orange County Sanitation District (OCSD) - (Vice President Ferryman) Meeting Oct 26, 2017 - Board of Directors Regular Meeting Access Public Type Information 10/20/2017 BoardDocs® Pro https://www.boarddocs.com/ca/cmsdca/Board.nsf/Private?open&login#43/49 H. LOCAL MEETINGS: In accordance with AB 1234 (Gov. Code 53232.3), a report is required to be given by a Director for any meeting for which expense reimbursement of any kind is provided. Note: For meetings for which the per diem compensation is sought, the Operations Code provides that such compensation is authorized for each day’s service rendered as a Director at the request of the Board (not to exceed six days in one month), and certain meetings are specified as being eligible as set forth in District Operations Code § 3.01.030. For meetings not so listed, the Board must approve the service for it to be eligible for the per day compensation. Subject 2. Santa Ana River Flood Protection Agency (SARFPA) - (Director Perry) Meeting Oct 26, 2017 - Board of Directors Regular Meeting Access Public Type Information 10/20/2017 BoardDocs® Pro https://www.boarddocs.com/ca/cmsdca/Board.nsf/Private?open&login#44/49 H. LOCAL MEETINGS: In accordance with AB 1234 (Gov. Code 53232.3), a report is required to be given by a Director for any meeting for which expense reimbursement of any kind is provided. Note: For meetings for which the per diem compensation is sought, the Operations Code provides that such compensation is authorized for each day’s service rendered as a Director at the request of the Board (not to exceed six days in one month), and certain meetings are specified as being eligible as set forth in District Operations Code § 3.01.030. For meetings not so listed, the Board must approve the service for it to be eligible for the per day compensation. Subject 3. Independent Special Districts of Orange County (ISDOC) - (President Scheafer) Meeting Oct 26, 2017 - Board of Directors Regular Meeting Access Public Type Information 10/20/2017 BoardDocs® Pro https://www.boarddocs.com/ca/cmsdca/Board.nsf/Private?open&login#45/49 H. LOCAL MEETINGS: In accordance with AB 1234 (Gov. Code 53232.3), a report is required to be given by a Director for any meeting for which expense reimbursement of any kind is provided. Note: For meetings for which the per diem compensation is sought, the Operations Code provides that such compensation is authorized for each day’s service rendered as a Director at the request of the Board (not to exceed six days in one month), and certain meetings are specified as being eligible as set forth in District Operations Code § 3.01.030. For meetings not so listed, the Board must approve the service for it to be eligible for the per day compensation. Subject 4. California Special Districts Association (CSDA) - (Secretary Schafer) Meeting Oct 26, 2017 - Board of Directors Regular Meeting Access Public Type Information 10/20/2017 BoardDocs® Pro https://www.boarddocs.com/ca/cmsdca/Board.nsf/Private?open&login#46/49 H. LOCAL MEETINGS: In accordance with AB 1234 (Gov. Code 53232.3), a report is required to be given by a Director for any meeting for which expense reimbursement of any kind is provided. Note: For meetings for which the per diem compensation is sought, the Operations Code provides that such compensation is authorized for each day’s service rendered as a Director at the request of the Board (not to exceed six days in one month), and certain meetings are specified as being eligible as set forth in District Operations Code § 3.01.030. For meetings not so listed, the Board must approve the service for it to be eligible for the per day compensation. Subject 5. Special District Risk Management Authority (SDRMA) - (President Scheafer) Meeting Oct 26, 2017 - Board of Directors Regular Meeting Access Public Type Information 10/20/2017 BoardDocs® Pro https://www.boarddocs.com/ca/cmsdca/Board.nsf/Private?open&login#47/49 H. LOCAL MEETINGS: In accordance with AB 1234 (Gov. Code 53232.3), a report is required to be given by a Director for any meeting for which expense reimbursement of any kind is provided. Note: For meetings for which the per diem compensation is sought, the Operations Code provides that such compensation is authorized for each day’s service rendered as a Director at the request of the Board (not to exceed six days in one month), and certain meetings are specified as being eligible as set forth in District Operations Code § 3.01.030. For meetings not so listed, the Board must approve the service for it to be eligible for the per day compensation. Subject 6. Other Meetings Qualifying for Reimbursement under CMSD Ordinance No. 55, Operations Code Section 3.01.030 Meeting Oct 26, 2017 - Board of Directors Regular Meeting Access Public Type Information 10/20/2017 BoardDocs® Pro https://www.boarddocs.com/ca/cmsdca/Board.nsf/Private?open&login#48/49 K. ORAL COMMUNICATIONS AND DIRECTOR COMMENTS Summary Analysis Legal Review Environmental Review Financial Review Public Notice Process Alternative Actions Subject 1. Oral Communications and Director Comments Meeting Oct 26, 2017 - Board of Directors Regular Meeting Access Public Type 10/20/2017 BoardDocs® Pro https://www.boarddocs.com/ca/cmsdca/Board.nsf/Private?open&login#49/49 L. CLOSING ITEMS THE NEXT REGULAR MEETING OF COSTA MESA SANITARY DISTRICT BOARD OF DIRECTORS WILL BE HELD ON NOVEMBER 30, 2017 IN THE DISTRICT'S BOARD ROOM, 290 PAULARINO AVE, COSTA MESA, CA 92626. Subject 1. Adjourn Meeting Oct 26, 2017 - Board of Directors Regular Meeting Access Public Type Procedural