The URL can be used to link to this page

Home My WebLink About09-19-18 F&A Committee Packet 1 OTAY WATER DISTRICT FINANCE AND ADMINISTRATION COMMITTEE MEETING and SPECIAL MEETING OF THE BOARD OF DIRECTORS 2554 SWEETWATER SPRINGS BOULEVARD SPRING VALLEY, CALIFORNIA BOARDROOM WEDNESDAY September 19, 2018 12:00 P.M. This is a District Committee meeting. This meeting is being posted as a special meeting in order to comply with the Brown Act (Government Code Section §54954.2) in the event that a quorum of the Board is present. Items will be deliberated, however, no formal board actions will be taken at this meeting. The committee makes recommendations to the full board for its consideration and formal action. AGENDA 1. ROLL CALL 2. PUBLIC PARTICIPATION – OPPORTUNITY FOR MEMBERS OF THE PUBLIC TO SPEAK TO THE BOARD ON ANY SUBJECT MATTER WITHIN THE BOARD'S JU- RISDICTION BUT NOT AN ITEM ON TODAY'S AGENDA DISCUSSION ITEMS 3. FISCAL YEAR 2018 DIRECTORS’ EXPENSES (FAKHOURI) [5 minutes] 4. ADOPT ORDINANCE NO. 569 AMENDING THE APPENDIX OF SECTION 6, CONFLICT OF INTEREST CODE (COIC), CONTAINED WITHIN THE DISTRICT’S CODE OF ORDINANCES TO UPDATE THE POSITION TITLES REQUIRED TO FILE A FORM 700; UPDATE WITHIN SECTION 6.05, STATEMENTS OF ECONOMIC INTERESTS: TIME OF FILING, THAT PERSONS WHO REPORT FOR MILITARY SERVICE SHALL FILE WITHIN 30 DAYS OF RETURNING TO OFFICE; TO CODIFY WITHIN SECTION 6.04, STATEMENTS OF ECONOMIC INTERESTS: PLACE OF FILING, THE PRACTICE OF ELECTRONICALLY FILING FORM 700’S; AND TO UPDATE GOVERNMENT CODE SECTION NUMBERS AND REFLECT CURRENT STATUTE LANGUAGE THROUGHOUT THE COIC (WATTON) [5 minutes] 2 5. ADOPT RESOLUTION NO. 4352 OF THE OTAY WATER DISTRICT AMENDING RESOLUTION NO. 4350 TO AUTHORIZE THE REFINANCING OF THE DISTRICT’S VARIABLE RATE DEMAND CERTIFICATES OF PARTICIPATION (1996 CAPITAL PROJECTS) THROUGH THE ISSUANCE BY THE OTAY WATER DISTRICT FINANCING AUTHORITY OF ITS WATER REVENUE BONDS, SERIES 2018A IN AN AGGREGATE PRINCIPAL AMOUNT NOT-TO-EXCEED $36,000,000, APPROVING THE EXECUTION OF CERTAIN DOCUMENTS AND AUTHORIZING CERTAIN ACTS IN CONNECTION THEREWITH (KOEPPEN) [5 minutes] 6. ADOPT RESOLUTION NO. 2018-03 RESOLUTION OF THE OTAY WATER DISTRICT FINANCING AUTHORITY AMENDING RESOLUTION NO. 2018-2 TO AUTHORIZE THE REFINANCING OF THE DISTRICT’S VARIABLE RATE DEMAND CERTIFICATES OF PARTICIPATION (1996 CAPITAL PROJECTS) AND INCREASING THE ISSUANCE AMOUNT OF THE AUTHORITY’S WATER REVENUE BONDS, SERIES 2018A TO AN AGGREGATE PRINCIPAL AMOUNT NOT-TO- EXCEED $36,000,000, APPROVING THE EXECUTION OF CERTAIN DOCUMENTS AND AUTHORIZING CERTAIN ACTS IN CONNECTION THEREWITH (KOEPPEN) [5 minutes] 7. YEAR-END REPORT ON THE DISTRICT’S FISCAL YEARS 2015-2018 STRATEGIC PERFORMANCE PLAN FOR FISCAL YEAR 2018 (SEGURA) [5 minutes] 8. ADJOURNMENT BOARD MEMBERS ATTENDING: Mark Robak, Chair Mitch Thompson 3 All items appearing on this agenda, whether or not expressly listed for action, may be delib- erated and may be subject to action by the Board. The Agenda, and any attachments containing written information, are available at the Dis- trict’s website at www.otaywater.gov. Written changes to any items to be considered at the open meeting, or to any attachments, will be posted on the District’s website. Copies of the Agenda and all attachments are also available through the District Secretary by contacting her at (619) 670-2280. If you have any disability which would require accommodation in order to enable you to par- ticipate in this meeting, please call the District Secretary at 670-2280 at least 24 hours prior to the meeting. Certification of Posting I certify that on September 14, 2018 I posted a copy of the foregoing agenda near the regular meeting place of the Board of Directors of Otay Water District, said time being at least 24 hours in advance of the meeting of the Board of Directors (Government Code Section §54954.2). Executed at Spring Valley, California on September 14, 2018. /s/ Susan Cruz, District Secretary STAFF REPORT TYPE MEETING: Regular Board MEETING DATE: October 3, 2018 SUBMITTED BY: Eid Fakhouri Finance Manager PROJECT: DIV. NO. All APPROVED BY: Joseph R. Beachem, Chief Financial Officer Mark Watton, General Manager SUBJECT: Fiscal Year 2018 Board of Directors’ Expenses GENERAL MANAGER’S RECOMMENDATION: This is an informational item only. COMMITTEE ACTION: Please see Attachment A. PURPOSE: To present the Board of the Directors’ expenses for Fiscal Year 2018. ANALYSIS: The California Government Code Section 53065.5 requires special districts, at least annually, to disclose any reimbursement paid by a district within the immediately preceding fiscal year. This Staff Report and attached documentation fulfills this requirement. (See Attachment B for the Summary and C-H for Details.) FISCAL IMPACT: None. 2 STRATEGIC GOAL: Prudently manage District funds. LEGAL IMPACT: Compliance with state law. Attachments: Attachment A Committee Action Attachment B Directors’ Expenses and Per Diems Attachment C-H Directors’ Expenses Detail ATTACHMENT A SUBJECT/PROJECT: Fiscal Year 2018 Board of Directors’ Expenses COMMITTEE ACTION: This is an informational item only. NOTE: The “Committee Action” is written in anticipation of the Committee moving the item forward for board approval. This report will be sent to the Board as a committee approved item, or modified to reflect any discussion or changes as directed from the committee prior to presentation to the full board. BOARD OF DIRECTORS’ EXPENSES AND PER DIEMS Board of Directors Meeting October 3, 2018 ATTACHMENT B California Government Code Section 53065.5 and Otay Water District’s Code of Ordinances Policy 8 require that staff present the Expenses and Per Diems for the Board of Directors on an annual basis: •Fiscal Year 2018. •The expenses are shown by Board member and expense type. •This presentation is in alphabetical order. •This information is being presented to the Finance and Administration Committee on September 19, 2018 and to the Board of Directors meeting on October 3, 2018. OTAY WATER DISTRICT BOARD EXPENSES July 1, 2017 - June 30, 2018 Croucher Gastelum Robak Smith Thompson Total Business Meetings $ - $ 623.16 $ 178.16 $ 195.82 $ 345.82 $ 1,342.96 Director's Fees 2,100.00 10,900.00 7,400.00 6,900.00 6,900.00 34,200.00 Mileage Business - 2,079.09 610.88 412.34 603.28 3,705.59 Mileage Commuting 3.27 214.56 47.40 568.89 477.62 1,311.74 Conferences and Seminars - 2,778.00 715.00 1,403.66 379.00 5,275.66 Travel - 4,447.56 1,430.78 1,614.50 801.30 8,294.14 Community Events - 628.33 685.00 - 478.33 1,791.66 Total $ 2,103.27 $ 21,670.70 $ 11,067.22 $ 11,095.21 $ 9,985.35 $ 55,921.75 ATTACHMENT C Jul-17 Aug-17 Sep-17 Oct-17 Nov-17 Dec-17 Jan-18 Feb-18 Mar-18 Apr-18 May-18 Jun-18 Total 1 2 3 4 5 6 7 8 9 10 11 12 5214 Business Meetings -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ 5281 Director's Fees - 100.00 300.00 200.00 - - 200.00 200.00 200.00 500.00 200.00 200.00 2,100.00 5211 Mileage - Business - - - - - - - - - - - - - 5211 Mileage - Commuting - - - - - - - - 3.27 - - - 3.27 5213 Seminars and Conferences - - - - - - - - - - - - - 5212 Travel - - - - - - - - - - - - - 5222 Community Events - - - - - - - - - - - - - Total -$ 100.00$ 300.00$ 200.00$ -$ -$ 200.00$ 200.00$ 203.27$ 500.00$ 200.00$ 200.00$ 2,103.27$ 5214 Business Meetings 25.00$ 55.00$ 90.00$ 25.00$ 30.00$ -$ 40.00$ 53.16$ 80.00$ 45.00$ 45.00$ 135.00$ 623.16$ 5281 Director's Fees 1,000.00 500.00 1,000.00 900.00 900.00 900.00 1,000.00 1,000.00 900.00 800.00 1,000.00 1,000.00 10,900.00 5211 Mileage - Business 126.26 231.12 148.73 274.46 127.33 179.23 111.18 230.05 143.88 101.92 207.65 197.29 2,079.09 5211 Mileage - Commuting 19.26 9.63 19.26 19.62 19.26 - 9.81 19.62 29.43 29.43 19.62 19.62 214.56 5213 Seminars and Conferences 50.00 50.00 805.00 - 699.00 - - 475.00 - 699.00 - - 2,778.00 5212 Travel 579.24 354.95 853.16 - - 1,111.20 - 613.23 65.96 - 708.60 161.22 4,447.56 5222 Community Events - - 200.00 178.33 250.00 - - - - - - - 628.33 Total 1,799.76$ 1,200.70$ 3,116.15$ 1,397.41$ 2,025.59$ 2,190.43$ 1,160.99$ 2,391.06$ 1,219.27$ 1,675.35$ 1,980.87$ 1,513.13$ 21,670.70$ 5214 Business Meetings -$ -$ -$ -$ 65.00$ -$ 58.16$ 25.00$ -$ -$ 30.00$ -$ 178.16$ 5281 Director's Fees 300.00 1,000.00 1,000.00 800.00 800.00 400.00 600.00 500.00 900.00 500.00 300.00 300.00 7,400.00 5211 Mileage - Business 3.75 63.13 114.49 52.97 116.63 32.10 47.96 37.06 76.85 31.07 13.08 21.80 610.88 5211 Mileage - Commuting 2.14 12.84 8.56 4.28 2.14 - 2.18 2.18 2.18 4.36 4.36 2.18 47.40 5213 Seminars and Conferences - - 25.00 - - - - 690.00 - - - - 715.00 5212 Travel - - - - - - - 618.00 812.78 - - - 1,430.78 5222 Community Events - - 300.00 135.00 250.00 - - - - - - - 685.00 Total 305.89$ 1,075.97$ 1,448.05$ 992.25$ 1,233.77$ 432.10$ 708.30$ 1,872.24$ 1,791.81$ 535.43$ 347.44$ 323.98$ 11,067.22$ HECTOR GASTELUM (DETAILED IN ATTACHMENT E) MARK ROBAK (DETAILED IN ATTACHMENT F) OTAY WATER DISTRICT ADMINISTRATIVE EXPENSES - BOARD JULY 1, 2017 - JUNE 30, 2018 GARY D. CROUCHER (DETAILED IN ATTACHMENT D) ATTACHMENT C Jul-17 Aug-17 Sep-17 Oct-17 Nov-17 Dec-17 Jan-18 Feb-18 Mar-18 Apr-18 May-18 Jun-18 Total OTAY WATER DISTRICT ADMINISTRATIVE EXPENSES - BOARD JULY 1, 2017 - JUNE 30, 2018 5214 Business Meetings -$ -$ -$ -$ -$ -$ -$ -$ 172.07$ -$ 23.75$ -$ 195.82$ 5281 Director's Fees 200.00 300.00 500.00 300.00 200.00 500.00 600.00 700.00 1,000.00 700.00 900.00 1,000.00 6,900.00 5211 Mileage - Business - 16.05 - - - - 45.30 57.23 87.20 26.16 92.11 88.29 412.34 5211 Mileage - Commuting 25.68 25.68 64.20 38.52 25.68 52.32 104.64 32.70 52.32 55.59 39.24 52.32 568.89 5213 Seminars and Conferences - - - - - - - 458.66 945.00 - - - 1,403.66 5212 Travel - - - - - - - 250.60 1,116.72 - - 247.18 1,614.50 5222 Community Events - - - - - - - - - - - - - Total 225.68$ 341.73$ 564.20$ 338.52$ 225.68$ 552.32$ 749.94$ 1,499.19$ 3,373.31$ 781.75$ 1,055.10$ 1,387.79$ 11,095.21$ 5214 Business Meetings -$ 61.00$ 30.00$ -$ -$ 23.16$ 70.00$ 53.16$ 18.50$ -$ -$ 90.00$ 345.82$ 5281 Director's Fees 200.00 1,000.00 600.00 - 800.00 300.00 800.00 600.00 700.00 1,000.00 600.00 300.00 6,900.00 5211 Mileage - Business 19.26 254.66 43.34 17.66 34.78 11.77 64.31 46.87 28.89 46.87 25.07 9.81 603.28 5211 Mileage - Commuting 13.91 55.64 55.64 55.64 27.82 13.91 - 99.19 56.68 28.34 42.51 28.34 477.62 5213 Seminars and Conferences - - - - - - - - - - - 379.00 379.00 5212 Travel - - - - - - - - - 801.30 - - 801.30 5222 Community Events - - 50.00 178.33 250.00 - - - - - - - 478.33 Total 233.17$ 1,371.30$ 778.98$ 251.63$ 1,112.60$ 348.84$ 934.31$ 799.22$ 804.07$ 1,876.51$ 667.58$ 807.15$ 9,985.35$ TOTALS: 5214 Business Meetings 25.00$ 116.00$ 120.00$ 25.00$ 95.00$ 23.16$ 168.16$ 131.32$ 270.57$ 45.00$ 98.75$ 225.00$ 1,342.96$ 5281 Director's Fees 1,700.00 2,900.00 3,400.00 2,200.00 2,700.00 2,100.00 3,200.00 3,000.00 3,700.00 3,500.00 3,000.00 2,800.00 34,200.00 5211 Mileage - Business 149.27 564.96 306.56 345.08 278.74 223.10 268.75 371.21 336.82 206.02 337.91 317.19 3,705.59 5211 Mileage - Commuting 60.99 103.79 147.66 118.06 74.90 66.23 116.63 153.69 143.88 117.72 105.73 102.46 1,311.74 5213 Seminars and Conferences 50.00 50.00 830.00 - 699.00 - - 1,623.66 945.00 699.00 - 379.00 5,275.66 5212 Travel 579.24 354.95 853.16 - - 1,111.20 - 1,481.83 1,995.46 801.30 708.60 408.40 8,294.14 5222 Community Events - - 550.00 491.66 750.00 - - - - - - - 1,791.66 Total 2,564.50$ 4,089.70$ 6,207.38$ 3,179.80$ 4,597.64$ 3,523.69$ 3,753.54$ 6,761.71$ 7,391.73$ 5,369.04$ 4,250.99$ 4,232.05$ 55,921.75$ TIM SMITH (DETAILED IN ATTACHMENT G) MITCHELL THOMPSON (DETAILED IN ATTACHMENT H) STAFF REPORT TYPE MEETING: Regular Board Meeting MEETING DATE: October 3, 2018 SUBMITTED BY: Mark Watton, General Manager W.O./G.F. NO: APPROVED BY: Susan Cruz, District Secretary Mark Watton, General Manager DIV. NO. SUBJECT: Adoption of Ordinance No. 569 Amending Section 6, Conflict of Interest Code, of the District’s Code of Ordinances GENERAL MANAGER’S RECOMMENDATION: That the Board adopt Ordinance No. 569 amending the Appendix of Section 6, Conflict of Interest Code (COIC), contained within the District’s Code of Ordinances to update the position titles required to file a Form 700; to denote within Section 6.05, Statements of Economic Interests: Time of Filing, that persons designated to file a Form 700 who report for military service shall file within 30 days following his/her return to office; to codify within Section 6.04, Statements of Economic Interests: Place of Filing, the current practice of electronically filing Form 700’s; and to update Government Code section numbers and reflect current Statute language throughout the COIC. PURPOSE: To amend the Appendix of Section 6, COIC, contained within the District’s Code of Ordinances to update the position titles required to file a Form 700; to denote within Section 6.05, Statements of Economic Interests: Time of Filing, that persons designated to file a Form 700 who report for military service shall file within 30 days following his/her return to office; to codify within Section 6.04, Statements of Economic Interests: Place of Filing, the current practice of electronically filing Form 700’s; and to update Government Code section numbers and reflect current Statute language throughout the COIC. COMMITTEE ACTION: See Attachment A. ANALYSIS: As required by the Political Reform Act (“Act”), staff has conducted a biennial review of the District’s COIC. The District’s Attorney reviewed the COIC and has suggested that the District include the following paragraph in Section 6.05, Statements of Economic Interests: Time of Filing, of the COIC to designate that a person who reports for military service shall file a Form 700 within 30 days following his/her return to office: “(E) Military Service. If a person reports for military service as defined in the Servicemember’s Civil Relief Act, the deadline for the annual statement of economic interests is 30 days following his or her return to office, provided the person, or someone authorized to represent the person's interests, notifies the filing officer in writing prior to the applicable filing deadline that he or she is subject to that federal statute and is unable to meet the applicable deadline, and provides the filing officer verification of his or her military status.” In addition, as the County of San Diego encourages the electronic filing of Form 700’s, a number of the District’s designated filers have been filing electronically. The District’s Attorney has added the following language in Section 6.04, Statements of Economic Interests: Place of Filing, to formally codify the practice of electronic filing: “The General Manager, or his or her designee, may file Statements of Economic Interests electronically in accordance with the provisions of Government Code Section 87500.2.” The District has also made organizational changes that affect the titles listed in its COIC. The following titles no longer exist and are being deleted from the Appendix of the COIC:  Asst. General Manager  Finance Manager, Controller and Budget  Finance Manager, Treasury and Accounting The following titles are being added:  Asst. Chief of Engineering  Asst. Chief of Finance  Finance Manager Further, Government Code section numbers have been updated and current Statute language has been reflected throughout the COIC. Ordinance No. 569 is submitted for the Board’s ratification to amend the COIC as noted above. A strike-thru copy of the COIC is attached to the ordinance for reference. FISCAL IMPACT: None. LEGAL IMPACT: None. Attachments: Attachment A – Committee Notes Attachment B - Ordinance No. 569 Strike-Thru Copy of the District’s COIC ATTACHMENT A SUBJECT/PROJECT: Adoption of Ordinance No. 569 Amending Section 6, Conflict of Interest Code, of the District’s Code of Ordinances COMMITTEE ACTION: This section will be updated with notes from the Finance and Administration Committee’s discussion at a meeting to be held on Wednesday, September 19, 2018. Page 1 of 1 ORDINANCE NO. 569 AN ORDINANCE OF THE BOARD OF DIRECTORS OF THE OTAY WATER DISTRICT AMENDING SECTION 6, CONFLICT OF INTEREST CODE, OF THE DISTRICT’S CODE OF ORDINANCE BE IT ORDAINED by the Board of Directors of Otay Water District that the District’s Code of Ordinances, Section 6, Conflict of Interest Code (COIC), be amended to update the position titles required to file a Form 700; to denote within Section 6.05, Statements of Economic Interests: Time of Filing, that persons designated to file a Form 700 who report for military service shall file within 30 days following his/her return to office; to codify within Section 6.04, Statements of Economic Interests: Place of Filing, the current practice of electronically filing Form 700’s; and to update Government Code section numbers and reflect current Statute language throughout the COIC. The amendments are presented in Exhibit A attached to this ordinance. NOW, THEREFORE, BE IT RESOLVED that the amendments to Section 6, Conflict of Interest Code, to the District’s Code of Ordinances shall become effective immediately upon adoption. PASSED, APPROVED AND ADOPTED by the Board of Directors of the Otay Water District at a regular meeting duly held this 3rd day of October 2018, by the following vote: AYES: NOES: ABSENT: ABSTAIN: ________________________________ President ATTEST: _____________________________ District Secretary Attachment B 6-1 DIVISION I DISTRICT ADMINISTRATION CHAPTER 5 PERSONNEL PRACTICES SECTION 6 CONFLICT OF INTEREST CODE 6.01 DEFINITIONS The definitions contained in the Political Reform Act of 1974 (Government Code Sections 81000 et seq.), regulations of the Fair Political Practices Commission (2 Cal. Code of Regs. Sections 18100, et seq.), and any amendments to the Act or regulations, are incorporated by reference into this Conflict of Iinterest Ccode. 6.02 DESIGNATED EMPLOYEES The persons holding positions listed in the Appendix are designated employees. It has been determined that these persons make or participate in the making of decisions which may foreseeably have a material effect on financial interests. The General Manager or his/her designee shall have the authority to designate any person holding a position within the District as a person designated to provide disclosures regardless of whether or not the position that the person holds is included in the Appendix if, in the view of the General Manager or his/her designee, the person has the potential to make or participate in the making of decisions which may foreseeably have a material effect on financial interests. 6.03 DISCLOSURE CATEGORIES This Code does not establish any disclosure obligation for those designated employees who are also specified in Government Code Section 87200 if they are designated in this code in that same capacity, or if the geographical jurisdiction of this agency is the same as or is wholly included within the jurisdiction in which those persons must report their financial interest pursuant to Article 2 of Chapter 72 of the Political Reform Act, Government Code Sections 87200, et seq.1 In addition, this code does not establish any disclosure obligation for any designated public officials who are designated in a conflict of interest code for another agency, if all of the following apply: 1 Designated employees who are required to file statements of economic interest under any other agency’s Conflict of Interest Code or under Article 2 for a different jurisdiction, may expand their statement of economic interests to cover reportable interest in both jurisdictions, and file copies of this expanded statement with both entities in lieu of filing separate and district statements, provided that each copy of such expanded statement filed in place of an original is signed and verified by the designated employee as if it were an original. See Government Code Section 81004. 6-2 (A) The geographical jurisdiction of this agency is the same as or is wholly included within the jurisdiction of the other agency; (B) The disclosure assigned in the code of the other agency is the same as that required under Aarticle 2 of Cchapter 7 of the Political Reform Act, Government Code Section 87200; and (C) The filing officer is the same for both agencies. Such persons are covered by this Code for disqualification purposes only. With respect to all other designated employees, the disclosure categories set forth in the Appendix specify which kinds of financial interests are reportable. Such a designated employee shall disclose in his or her Sstatement of Eeconomic Iinterest those financial interests he or she has which are of the kind described in the disclosure categories to which he or she is assigned in the Appendix. It has been determined that the financial interests set forth in a designated employee’s disclosure categories are the kinds of financial interests which he or she foreseeably can affect materially through the conduct of his or her office. 6.04 STATEMENTS OF ECONOMIC INTERESTS: PLACE OF FILING All officials and employees required to submit a Sstatement of Eeconomic Iinterest (employees in Designated Positions) shall file their statements with the General Manager, or his or her designee. The District shall make and retain a copy of all statements filed by Designated Positions and forward the originals of such statements to the Executive Office of the Board of Supervisors of San Diego County. All retained statements, originals or copies shall be available for public inspection and reproduction. (Cal. Gov’t Code § 81008).2 The[JB1] General Manager, or his or her designee may file Statements of Economic Interests electronically in accordance with the provisions of Government Code Section 87500.2. 6.05 STATEMENTS OF ECONOMIC INTERESTS: TIME OF FILING (A) Initial Statements. All designated employees employed by the agency on the effective date of this code, as originally adopted, promulgated and approved by the code reviewing body, shall file statements within 30 days after the effective date of this code. Thereafter, each person already in a position when it is designated by an amendment to this code shall file an initial statement within 30 days after the effective date of the amendment. 2 See Government Code section 81010 and 2 Cal. Code of Regs. section 18115 for the duties of filing officers and persons in agencies who make and retain copies of statements and forward the originals to the filing officer. 6-3 (B) Assuming Office Statements. All persons assuming designated positions after the effective date of this code shall file statements within 30 days after assuming the designated positions, or if subject to State Senate confirmation, 30 days after being nominated or appointed. (C) Annual Statements. All designated employees shall file statements no later than April 1. (D) Leaving Office Statements. All persons who leave designated positions shall file statements within 30 days after leaving office. (E) Military Service. If a person reports for military service as defined in the Servicemember's Civil Relief Act, the deadline for the annual statement of economic interests is 30 days following his or her return to office, provided the person, or someone authorized to represent the person's interests, notifies the filing officer in writing prior to the applicable filing deadline that he or she is subject to that federal statute and is unable to meet the applicable deadline, and provides the filing officer verification of his or her military status. 6.06 STATEMENTS FOR PERSONS WHO RESIGN PRIOR TO ASSUMING OFFICE Any person who resigns within 12 months of initial appointment, or within 30 days of the date of notice provided by the filing officer to file an assuming office statement, is not deemed to have assumed office or left office, provided he or she did not make or participate in the making of, or use his or her position to influence any decision and did not receive or become entitled to receive any form of payment as a result of his or her appointment. Such persons shall not file either an assuming or a leaving office statement. (A) Any person who resigns a position within 30 days of the date of a notice from the filing officer shall do both of the following: 1. File a written resignation with the appointing power; and 2. File a written statement with the filing officer declaring under penalty of perjury that during the period between appointment and resignation he or she did not make, participate in the making, or use the position to influence any decision of the agency or receive, or become entitled to receive, any form of payment by virtue of being appointed to the position. 6.07 CONTENTS OF AND PERIOD COVERED BY STATEMENTS OF ECONOMIC INTERESTS 6-4 (A) Contents of Initial Statements Initial statements shall disclose any reportable investments, interests in real property and business positions held on the effective date of the code and income received during the 12 months prior to the effective date of the code. (B) Contents of Assuming Office Statements Assuming office statements shall disclose any reportable investments, interests in real property and business positions held on the date of assuming office or on the date of appointment, and income received during the 12 months prior to the date of assuming office or the date of being appointed, respectively. (C) Contents of Annual Statements Annual statements shall disclose any reportable investments, interests in real property, income and business positions held or received during the previous calendar year provided, however, that the period covered by an employee’s first annual statement shall begin on the effective date of the code or the date of assuming office, whichever is later. (D) Contents of Leaving Office Statements Leaving office statements shall disclose reportable investments, interest in real property, income and business positions held or received during the period between the closing date of the last statement filed and the date of leaving office. 6.08 MANNER OF REPORTING Statements of economic interest shall be made on forms prescribed by the Fair Political Practices Commission and supplied by the agency, and shall contain the following information: (A) Investments and Real Property Disclosure When an investment or an interest in real property3 is required to be reported4, the statement shall contain the following: 3 For the purpose of disclosure only (not disqualification), an interest in real property does not include the principal residence of the filer. 4 Investments and interests in real property which have a fair market value of less than $2,000 are not investments and interests in real property within the meaning of the Political Reform Act. However, investments or interests in real property of an individual include those held by the individual’s spouse and dependent children as well as a pro rata share of any investment or interest in real property of any 6-5 1. A statement of the nature of the investment or interest; 2. The name of the business entity in which each investment is held, and a general description of the business activity in which the business entity is engaged; 3. The address or other precise location of the real property; 4. A statement whether the fair market value of the investment or interest in real property equals or exceeds two thousand dollars ($2,000), exceeds ten thousand dollars ($10,000), exceeds one hundred thousand dollars ($100,000), or exceeds one million dollars ($1,000,000). (B) Personal Income Disclosure When personal income is required to be reported5, the statement shall contain: 1. The name and address of each source of income aggregating $500 or more in value or $50 or more in value if the income was a gift, and a general description of the business activity, if any, of each source; 2. A statement whether the aggregate value of income from each source, or in the case of a loan, the highest amount owed to each source, was one thousand dollars ($1,000) or less, greater than one thousand dollars ($1,000), greater than ten thousand dollars ($10,000), or greater than one hundred thousand dollars ($100,000); 3. A description of the consideration, if any, for which the income was received; 4. In the case of a gift, the name, address and business activity of the donor and any intermediary through which the gift was made; a description of the gift; the amount or value of the gift; and the date on which the gift was received; 5. File In the case of a loan, the annual interest rate and the security, if any, given for the loan and the term of the loan. business entity or trust in which the individual, spouse and dependent children own, in the aggregate, a direct, indirect or beneficial interest of 10 percent or greater. 5 A designated employee’s income includes his or her community property interest in the income of his or her spouse but does not include salary or reimbursement for expenses received from a state, local or federal government agency. 6-6 (C) Business Entity Income Disclosure When income of a business entity, including income of a sole proprietorship, is required to be reported6, the statement shall contain: 1. The name, address and a general description of the business activity of the business entity; 2. The name of every person from whom the business entity received payments if the filer’s pro rata share of gross receipts from such person was equal to or greater than $10,000. (D) Business Position Disclosure When business positions are required to be reported, a designated employee shall list the name and address of each business entity in which he or she is a director, officer, partner, trustee, employee or in which he or she holds any position of management, a description of the business activity in which the business entity is engaged, and the designated employee’s position with the business entity. (E) Acquisition or Disposal During Reporting Period In the case of an annual or leaving office statement, if an investment or an interest in real property was partially or wholly acquired or disposed of during the period covered by the statement, the statement shall contain the date of acquisition or disposal. 6.09 PROHIBITION ON RECEIPT OF HONORARIA A. No designated public official shall accept any honorarium from any source, if the member or employee would be required to report the receipt of income or gifts from that source on his or her statement of economic interests. Subdivisions (a), (b), and (c) of Government Code Section 89501 shall apply to the prohibitions in this section. This section shall not limit or prohibit payments, advances, or reim- bursements for travel and related lodging and subsistence authorized by Government Code section 89506. 6 Income of a business entity is reportable if the direct, indirect or beneficial interest of the filer and the filer’s spouse in the business entity aggregates a 10 percent or greater interest. In addition, the disclosure of persons who are clients or customers of a business entity is required only if the clients or customers are within one of the disclosure categories of the filer. 6-7 6.10 PROHIBITION ON RECEIPT OF GIFTS IN EXCESS OF AMOUNT ESTABLISHED BY LAW7 A. No designated public official shall accept gifts with a total value of more than the maximum amount established by law, in any calendar year, from any single source, if the member or employee would be required to report the receipt of income or gifts from that source on his or her statement of economic interests. Subdivisions (e), (f), and (g) of Government Code section 89503 shall apply to the prohibitions in this section. 6.11 LOANS TO PUBLIC OFFICIALS A. No elected officer of a state or local government agency shall, from the date of his or her election to office through the date that he or she vacates office, receive a personal loan from any officer, employee, member, or consultant of the state or local government agency in which the elected officer holds office or over which the elected officer’s agency has direction and control. B. No public official who is exempt from the state civil service system pursuant to subdivisions (c), (d), (e), (f), and (g) of Section 4 of Article VII of the Constitution shall, while he or she holds office, receive a personal loan from any officer, employee, member, or consultant of the state or local government agency in which the public official holds office or over which the public official’s agency has direction and control. This subdivision shall not apply to loans made to a public official whose duties are solely secretarial, clerical, or manual. C. No elected officer of a state or local government agency shall, from the date of his or her election to office through the date that he or she vacates office, receive a personal loan from any person who has a contract with the state or local government agency to which that elected officer has been elected or over which that elected officer’s agency has direction and control. This subdivision shall not apply to loans made by banks or other financial institutions or to any indebtedness created as part of a retail installment or credit card transaction, if the loan is made or the indebtedness created in the 7 Designated Persons are prohibited from accepting gifts from any single source in a calendar year with a total value in excess of designated amounts. See Govt. Code § 89503, sub-divisions (e), (f) and (g). [Note: Pursuant to 2 CCR § 18940.2 (bGovt. Code § 89503(f)), the FPPC adjusts the gift limit every odd-numbered year to reflect changes in the Consumer Price Index; therefore, the $390 470 limit adopted by the FPPC in January of 2007 2017 will be updated in January 2009 2019 and every odd year thereafter, until further notice. See also 2 CCR § 18940.2] 6-8 lender’s regular course of business on terms available to members of the public without regard to the elected officer’s official status. D. No public official who is exempt from the state civil service system pursuant to subdivisions (c), (d), (e), (f), and (g) of Section 4 of Article VII of the Constitution shall, while he or she holds office, receive a personal loan from any person who has a contract with the state or local government agency to which that elected officer has been elected or over which that elected officer’s agency has direction and control. This subdivision shall not apply to loans made by banks or other financial institutions or to any indebtedness created as part of a retail installment or credit card transaction, if the loan is made or the indebtedness created in the lender’s regular course of business on terms available to members of the public without regard to the elected officer’s official status. This subdivision shall not apply to loans made to a public official whose duties are solely secretarial, clerical, or manual. E. This section shall not apply to the following: 1. Loans made to the campaign committee of an elected officer or candidate for elective office. 2. Loans made by a public official’s spouse, child, parent, grandparent, grandchild, brother, sister, parent-in-law, brother-in- law, sister-in-law, nephew, niece, aunt, uncle, or first cousin, or the spouse of any such persons, provided that the person making the loan is not acting as an agent or intermediary for any person not otherwise exempted under this section. 3. Loans from a person which, in the aggregate, do not exceed five hundred dollars ($500) at any given time. 4. Loans made, or offered in writing, before January 1, 1998. 6.12 LOAN TERMS A. Except as set forth in subdivision (B), no elected officer of a state or local government agency shall, from the date of his or her election to office through the date he or she vacates office, receive a personal loan of five hundred dollars ($500) or more, except when the loan is in writing and clearly states the terms of the loan, including the parties to the loan agreement, date of the loan, amount of the loan, term of the loan, date or dates when payments shall be due on the loan and the amount of the payments, and the rate of interest paid on the loan. B. This section shall not apply to the following types of loans: 1. Loans made to the campaign committee of the elected officer. 6-9 2. Loans made to the elected officer by his or her spouse, child, parent, grandparent, grandchild, brother, sister, parent-in- law, brother-in-law, sister-in-law, nephew, niece, aunt, uncle, or first cousin, or the spouse of any such person, provided that the person making the loan is not acting as an agent or intermediary for any person not otherwise exempted under this section. 3. Loans made, or offered in writing, before January 1, 1998. C4. Nothing in this section shall exempt any person from any other provision of Title 9 of the Government Code. 6.13 PERSONAL LOANS A. Except as set forth in subdivision (B), a personal loan received by any designated public official shall become a gift to the designated public official for the purposes of this section in the following circumstances: 1. If the loan has a defined date or dates for repayment, when the statute of limitations for filing an action for default has expired. 2. If the loan has no defined date or dates for repayment, when one year has elapsed from the later of the following: a. The date the loan was made. b. The date the last payment of one hundred dollars ($100) or more was made on the loan. c. The date upon which the debtor has made payments on the loan aggregating to less than two hundred fifty dollars ($250) during the previous 12 months. B. This section shall not apply to the following types of loans: 1. A loan made to the campaign committee of an elected officer or a candidate for elective office. 2. A loan that would otherwise not be a gift as defined in this title. 3. A loan that would otherwise be a gift as set forth under subdivision (A), but on which the creditor has taken reasonable action to collect the balance due. 4. A loan that would otherwise be a gift as set forth under subdivision (A), but on which the creditor, based on reasonable business considerations, has not undertaken collection action. Except in a criminal action, a creditor who claims that a loan is not a gift 6-10 on the basis of this paragraph has the burden of proving that the decision for not taking collection action was based on reasonable business considerations. 5. A loan made to a debtor who has filed for bankruptcy and the loan is ultimately discharged in bankruptcy. C. Nothing in this section shall exempt any person from any other provisions of Title 9 of the Government Code. 6.14 DISQUALIFICATION No designated employee shall make, participate in making, or in any way attempt to use his or her official position to influence the making of any governmental decision which he or she knows or has reason to know will have a reasonably foreseeable material financial effect, distinguishable from its effect on the public generally, on the official or a member of his or her immediate family or on: (A) Any business entity in which the designated employee has a direct or indirect investment worth $2,000 or more; (B) Any real property in which the designated employee has a direct or indirect interest worth $2,000 or more; (C) Any source of income, other than gifts and other than loans by a commercial lending institution in the regular course of business on terms available to the public without regard to official status, aggregating $500 or more in value provided to, received by or promised to the designated employee within 12 months prior to the time when the decision is made; (D) Any business entity in which the designated employee is a director, officer, partner, trustee, employee, or holds any position of management; or (E) Any donor of, or any intermediary or agent for a donor of, a gift or gifts aggregating to the maximum amount established by law, or more, in value provided to, received by, or promised to the designated employee within 12 months prior to the time when the decision is made. 6.15 LEGALLY REQUIRED PARTICIPATION No designated public official shall be prevented from making or participating in the making of any decision to the extent his or her participation is legally required for the decision to be made. The 6-11 fact that the vote of a designated public official who is on a voting body is needed to break a tie does not make his or her participation legally required for purposes of this section. 6.16 DISQUALIFICATION OF STATE OFFICERS AND EMPLOYEES In addition to the general disqualification provisions of Section 6.14, no state administrative official shall make, participate in making, or use his or her official position to influence any governmental decision directly relating to any contract where the state administrative official knows or has reason to know that any party to the contract is a person with whom the state administrative official, or any member of his or her immediate family has, within 12 months prior to the time when the official action is to be taken: (A) Engaged in a business transaction or transactions on terms not available to members of the public, regarding any investment or interest in real property; or (B) Engaged in a business transaction or transactions on terms not available to members of the public regarding the rendering of goods or services totaling in value $1000 or more. 6.17 DISCLOSURE OF DISQUALIFYING INTEREST When a designated public official determines that he or she should not make a governmental decision because he or she has a disqualifying interest in it, the determination not to act may be accompanied by disclosure of the disqualifying interest. 6.18 ASSISTANCE OF THE COMMISSION AND COUNSEL Any designated employee who is unsure of his or her duties under this code may request assistance from the Fair Political Practices Commission pursuant to Government Code Section 83114 and 2 CCR Sections 18329 and 18329.5 or from the attorney for his or her agency, provided that nothing in this section requires the attorney for the agency to issue any formal or informal opinion. 6.19 VIOLATIONS This code has the force and effect of law. Designated employees violating any provision of this code are subject to the administrative, criminal and civil sanctions provided in the Political Reform Act, Government Code Sections 81000 – 91015. In addition, a decision in relation to which a violation of the disqualification 6-12 provisions of this code or of Government Code Section 87100 or 87450 has occurred may be set aside as void pursuant to Government Code Section 91003. 6.20 PROHIBITED TRANSACTIONS Members of the Board of Directors and Designated Employees shall comply with the Prohibited Transactions policy, annexed hereto as Exhibit A, pursuant to California Government Code Sections 1090, et seq. 6.21 INCOMPATIBLE ACTIVITIES Members of the Board of Directors, District officers, and all other District employees shall comply with the Incompatible Activities policy, annexed hereto as Exhibit B, pursuant to California Government Code Sections 1126, et seq. 6-13 APPENDIX OTAY WATER DISTRICT CONFLICT OF INTEREST CODE DESIGNATED POSITIONS The Treasurer and all District Officials who manage the investment of public funds are included in and governed by this Conflict of Interest Code only with respect to its disqualification provisions. For purposes of disclosure, the Treasurer and all District Officials who manage the investment of public funds are governed by the statutory conflict of interest provisions of Article 2 of Chapter 7 of the Political Reform Act of 1974. (Government Code Sections 87200, et seq.) DESIGNATED EMPLOYEES’ TITLE OR FUNCTION__ DISCLOSURE CATEGORIES ASSIGNED Members of the Board of Directors 1, 2, 3, 4, 5, 6 General Manager 1, 2, 3, 4, 5, 6 District Secretary 6 Assistant Chief of Engineering 1, 2, 3, 4, 6, 7 Assistant Chief of Finance 1, 2, 5, 6, 7 Assistant Chief of Water Operations 1, 2, 3, 4, 6, 7 Assistant General Manager 1, 2, 3, 4, 5, 6, 7 Chief of Administrative Services 1, 2, 3, 4, 5, 6, 7 Chief Financial Officer 1, 2, 5, 6, 7 Chief of Engineering 1, 2, 3, 4, 6, 7 Chief of Water Operations 1, 2, 3, 4, 6, 7 Associate Civil Engineer 1, 2, 3, 4, 7 Communications Officer 6 Customer Service Manager 2, 5, 7 Environmental Compliance Specialist 1, 2, 3, 4, 7 Engineering Manager 1, 2, 3, 4, 7 6-14 Field Services Manager 1, 2, 3, 4, 7 Finance Manager, Controller and Budget 2, 5, 7 Finance Manager, Treasury and Accounting 2, 5, 7 GIS Manager 3, 6, 7 Human Resources Manager 3, 6 IT Manager 3, 6, 7 Network Engineer 3, 6, 7 Purchasing and Facilities Manager 2, 6 Safety and Security Specialist 1, 2, 3, 4, 6 Senior Procurement and Contracting Analyst 6 Senior Civil Engineer 1, 2, 3, 4, 7 System Operations Manager 1, 2, 3, 4, 7 Utility Services Manager 1, 2, 3, 4, 7 Consultant8 1, 2, 3, 4, 5, 6 8 Consultants are required to file disclosure statements where they: (a) conduct research and arrive at conclusions with respect to rendition of information, advice, recommendation or counsel independent of control and direction of the agency or any agency official other than normal contract monitoring; and (b) possess no authority with respect to any agency decision beyond the rendition of information, advice, recommendation or counsel. The determination as to whether a consultant shall be required to file a disclosure statement shall be made by the General Manager or his or her designee. 6-15 APPENDIX, CONTINUED DISCLOSURE CATEGORIES The disclosure categories listed below identify the types of investments, business entities, sources of income, or real property which the designated employee must disclose for each disclosure category to which he or she is assigned. Category 1: All investments and business positions in, and sources of income from, all business entities that do business or own real property in the District, plan to do business or own real property in the District within the next year or have done business or owned real property in the District within the past two years. Category 2: All interests in real property which are located in whole or in part within, or not more than two (2) miles outside the boundaries of the District. Category 3: All investments and business positions in, and sources of income from, business entities subject to the regulatory, permit or licensing authority of the Designated Employee’s Department, will be subject to such authority within the next year or have been subject to such authority within the past two years. Category 4: All investments, business positions, and sources of income from, business entities that are engaged in land development, construction or the acquisition or sale of real property in the District, plan to engage in such activities in the District within the next year or have engaged in such activities in the District within the past two years. Category 5: All investments and business positions in, and sources of income from, business entities that are banking, savings and loan or other financial institutions. Category 6: All investments and business positions in, and sources of income from, business entities that provide services, supplies, materials, machinery or equipment of a type purchased, leased, used, or administered by the District. Category 7: All investments and business positions in, and sources of income from, business entities that provide services, supplies, materials, machinery or equipment of a type purchased, leased, used, or administered by the Designated Employee’s Department. 6-16 EXHIBIT A Prohibited Transactions for Specified Personnel Members of the Board of Directors (“Members”) shall comply with this Prohibited Transactions policy pursuant to California Government Code §§ 1090, et seq. Members shall not be financially interested in any contract made by them in their official capacity, or by any body or board of which they are members. Members shall not be purchasers at any sale or vendors at any purchase made by them in their official capacity. Members shall not be deemed to be interested in a contract entered into by a body or board of which they are members if the Member has only a remote interest in the contract and if the fact of that interest is disclosed to the body or board of which the Member is a member and noted in its official records, and thereafter the body or board authorizes, approves, or ratifies the contract in good faith by a vote of its membership sufficient for the purpose without counting the vote or votes of the Board of Directors member with the remote interest. “Remote interest” shall be defined as in California Government Code § 1091(b). Members shall not be considered to be financially interested in a contract if their interest is including, but not limited to, any of the following (Government Code § 1091.5): 1. That of an officer in being reimbursed for his/her actual and necessary expenses incurred in the performance of an official duty; 2. That of a recipient of public services generally provided by the public body or board of which he/she is a member, on the same terms and conditions as if he or she were not a member of the board; 3. That of a landlord or tenant of the contracting party if such contracting party is the federal government or any federal department or agency, this state or an adjoining state, any department or agency of this state or an adjoining state, any county or city of this state or an adjoining state, or an public corporation or special, judicial or other public district of this state or an adjoining state unless the subject matter of such contract is the property in which such officer or employee has such interest as landlord or tenant in which even his/her interest shall be deemed a remote interest within the meaning of, and subject to, the provisions of Government Code 1091; 6-17 4. That of a spouse of an officer or employee of a public agency if his/her spouse’s employment or office-holding has existed for at least one year prior to his/her election or appointment; 5. That of a non-salaried member of a nonprofit corporation, provided that such interest is disclosed to the board at the time of the first consideration of the contract, and provided further that such interest is noted in its official records; 6. That of a non-compensated officer of a nonprofit, tax-exempt corporation, which, as one of its primary purposes, supports the functions of the board or to which the board has legal obligation to give particular consideration, and provided further that such interest is noted in its official records; For purposes of this paragraph, an officer is “noncompensated” even though he or she receives reimbursement from the nonprofit, tax-exempt corporation for necessary travel and other actual expenses incurred in performing the duties of his or her office. 6.7. That of compensation for employment with a governmental agency, other than the governmental agency that employs the officer or employee, provided that the interest is disclosed to the board at the time of consideration of the contract, and provided further that the interest is noted in its official records; 7.8. That of an attorney of the contracting party of that of an owner, officer, employee or agent of a firm which renders, or has rendered, service to the contracting party in the capacity of stockbroker, insurance agent, insurance broker, real estate agent, or real estate broker if these individuals have not received and will not receive remuneration, consideration, or a commission as a result of the contract and if these individuals have an ownership interest of less than 10 percent in the law practice or firm, stock brokerage firm, insurance firm or real estate firm. In addition, Members shall not be deemed to be interested in a contract made pursuant to competitive bidding under a procedure established by law if their sole interest is that of an officer, director, or employee of a bank or savings and loan association with which a party to the contract has the relationship of borrower or depositor, debtor or creditor (Government Code § 1091.5). Authority: California Government Code §§ 1090, et seq. 6-18 EXHIBIT B Incompatible Activities Policy District officers, members of the Board of Directors, and all other District employees (collectively, “district personnel”) shall comply with this Incompatible Activities policy pursuant to California Government Code §§ 11256, et seq. District personnel shall not engage in any employment, activity, or enterprise for compensation which is inconsistent, incompatible, in conflict with, or inimical to his or her duties as a member of the Board of Directors, or with the duties, functions, or responsibilities of his or her appointing power or the agency by which he or she is employed. The outside employment, activity, or enterprise of district personnel is prohibited if it: (1) involves the use for private gain or advantage of his or her local District time, facilities, equipment and supplies; or the badge, uniform, prestige, or influence of his or her local District office or employment or, (2) involves receipt or acceptance by district personnel of any money or other consideration from anyone other than the District for the performance of an act which district personnel, if not performing such act, would be required or expected to render in the regular course or hours of their local District employment or as a part of their duties as a local District officer or employee or, (3) involves the time demands as would render performance of his or her duties as a local district personnel member less efficient. Nothing in this policy shall be interpreted to prohibit any outside employment, activity, counsel, or enterprise on behalf of another governmental entity, subject to common law and professional conflict of interest rules. Copies of this regulation shall be posted in prominent places at the District Office. District personnel who violate this regulation may be subject to discipline as set forth in the applicable Code of Ordinances and Policies. Board of Directors members who violate this section may be subject to censure. Disciplinary appeals by district personnel shall be handled pursuant to applicable Code of Ordinances and Policies. Authority: California Government Code §§ 1125, et seq. STAFF REPORT TYPE MEETING: Regular Board Meeting of the Otay Water District MEETING DATE: October 3, 2018 SUBMITTED BY: Kevin Koeppen, Assistant Chief of Finance W.O./G.F. NO: DIV. NO. All APPROVED BY: Joseph R. Beachem, Chief Financial Officer Mark Watton, General Manager SUBJECT: Adopt Resolution No. 4352 of the Otay Water District Amending Resolution No. 4350 to Authorize the Refinancing of the District’s Variable Rate Demand Certificates of Participation (1996 Capital Projects)through the Issuance by the Otay Water District Financing Authority of its Water Revenue Bonds, Series 2018A in an Aggregate Principal Amount Not to Exceed $36,000,000, Approving the Execution of Certain Documents and Authorizing Certain Acts in Connection Therewith GENERAL MANAGER’S RECOMMENDATION: That the Board of Directors of the Otay Water District (“Board”) adopt Resolution No. 4352 amending Resolution No. 4350 to authorize the refinancing of the District’s Variable Rate Demand Certificates of Participation (1996 Capital Projects)through the issuance by the Otay Water District Financing Authority of its Water Revenue Bonds, Series 2018A in an aggregate principal amount not to exceed $36,000,000, and authorize the General Manager and Chief Financial Officer to approve the amendments to and execution of certain documents and authorizing certain acts in connection therewith. COMMITTEE ACTION: See Attachment A. PURPOSE: To obtain the Board’s authorization to increase the issuance amount of Otay Water District Financing Authority (“Authority”) Water Revenue Bonds by $7,000,000, to include the refinancing of the District’s $6,900,000 outstanding Variable Rate Demand Certificates of Participation (“1996 Variable Rate COPS”) in addition to the funding the District’s three-year CIP Program as previously directed, and authorize the General Manager, Chief Financial Officer, Secretary, and Treasurer to amend, execute and deliver related documents and take other related actions necessary for the issuance of the 2018 Water Revenue Bonds. ANALYSIS: On September 5, 2018, the Board approved the issuance of up to $29,000,000 of the Authority’s Water Revenue Bonds, Series 2018A to fund $28,000,000 of the District CIP over the next three years. Staff is recommending the bond authorization be increased to an amount not to exceed $36,000,000 and that the additional proceeds be used to refinance the $6,900,000 outstanding 1996 Variable Rate COPS. Staff anticipates the required funding amount will be approximately $35,330,000, including cost of issuance, and the District will not issue any more debt than is required for the two purposes. By refinancing the District’s 1996 Variable Rate COPS to a fixed rate, the District is estimated to save approximately $500,000 through the original maturity date in 2026. The analysis was prepared by the District’s Financial Advisor and maintains the same maturity timing as defined in the original issuance, which fully matured in 2026. This change in the bond structure and purpose is due to updated information recently received from Union Bank and analyzed by the District’s Financial Advisor. A variable rate debt issuance requires additional services that are not required under a fixed rate issuance including a letter of credit and a remarketing agent. As of today the District’s bank, Union Bank, serves as both the letter of credit provider and the remarketing agent (Agent). Recently Union Bank communicated to the District that they would no longer be providing remarketing services and that the District would need to find a replacement agent. The replacement of the Agent which was anticipated to be a low cost event. During the Agent replacement process the potential Agents requested the District produce a Reoffering Statement, which is the equivalent of preparing an Official Statement as well as providing a number of legal opinions. Therefore, replacing the Agent would cost approximately $30,000. In discussing the additional requirements with the District’s Financial Advisor and Bond Counsel, it was suggested that the District re-evaluate refinancing the 1996 Variable Rate COPS to a fixed rate issuance. In prior reviews, staff had determined that there was still a benefit to holding the COPS and in the event short-term variable interest rates were to exceed long-term interest rates the District was in a position to pay off the 1996 Variable Rate COPS. As a result of paying down the pension UAL, the District’s liquidity is now at a level that it may be unable to pay down the 1996 Variable Rate COPS in the event interest rates were to rise and it would likely not be cost effective to issue a relatively small debt issuance. Interest rates on the 1996 Variable Rate COPS have increased approximately 0.8% over the last 22 months and are expected to continue to increase as a result of additional Federal Reserve Board action. The current variable interest rate is 1.57%, an increase of over 50 basis points just in the past month. The overall effective financing cost of the Variable Rate COPS is even higher since we added the letter of credit fee of (0.95%). This increased cost has made it cost effective to refinance this variable rate bond expense. Assuming the periodic variable rate increases up to 2.75% for the term of the 1996 Variable Rate COPS and adding variable rate costs, and comparing to the incremental debt service of adding the refinancing to the current financing, shows that the District can save more than $500,000 over the remaining term. The comparison is shown on Attachment B. As a result of these circumstances and the economies of scale relating to costs of issuance, staff re-evaluated their position on the benefits of refinancing the debt and determined that it would be cost beneficial. In the event liquidity would return at a greater rate or to above budgeted levels, the District would use those funds to defease other outstanding bond debts or reduce other financial obligations, including the 2010A bonds, PERS obligation, or OPEB obligation. Conclusion That the Board of Directors of the Otay Water District adopt Resolution No. 4352 amending Resolution No. 4350 to authorize the refinancing of the District’s Variable Rate Demand Certificates of Participation (1996 Capital Projects) through the issuance by the Otay Water District Financing Authority of its Water Revenue Bonds, Series 2018A in an aggregate principal amount not to exceed $36,000,000, and authorize the General Manager and Chief Financial Officer to approve the amendments to and execution of certain documents and authorizing certain acts in connection therewith. District staff is drafting the amended documents which will, in all material respects be the same as those presented and approved by the Board on September 5, 2018, except for changes to reflect the new amount of the issuance and the refinancing information. FISCAL IMPACT: Joe Beachem, Chief Financial Officer Including the refinancing of the 1996 Variable Rate COPs will save the District over $500,000 over the next eight years. STRATEGIC GOAL: The District ensures its continued financial health through long-term financial planning and debt planning. LEGAL IMPACT: None. General Manager Attachments: A) Committee Action The following attachments will be provided with the Staff Report to the Board on October 3, 2018. B) Resolution No. 4352 C) Preliminary Official Statement ATTACHMENT A SUBJECT/PROJECT: Adopt Resolution No. 4352 of the Otay Water District Amending Resolution No. 4350 to Authorize the Refinancing of the District’s Variable Rate Demand Certificates of Participation (1996 Capital Projects)through the Issuance by the Otay Water District Financing Authority of its Water Revenue Bonds, Series 2018A in an Aggregate Principal Amount Not to Exceed $36,000,000, Approving the Execution of Certain Documents and Authorizing Certain Acts in Connection Therewith COMMITTEE ACTION: That the Finance and Administration Committee recommend the Board of Directors of the Otay Water District (“Board”) adopt Resolution No. 4352 amending Resolution No. 4350 to authorize the refinancing of the District’s Variable Rate Demand Certificates of Participation (1996 Capital Projects)through the issuance by the Otay Water District Financing Authority of its Water Revenue Bonds, Series 2018A in an aggregate principal amount not to exceed $36,000,000, and authorize the General Manager and Chief Financial Officer to approve the amendments to and execution of certain documents and authorizing certain acts in connection therewith. NOTE: The “Committee Action” is written in anticipation of the Committee moving the item forward for board approval. This report will be sent to the Board as a committee approved item, or modified to reflect any discussion or changes as directed from the committee prior to presentation to the full board. STAFF REPORT TYPE MEETING: Regular Board Meeting of the Otay Water District Financing Authority MEETING DATE: October 3, 2018 SUBMITTED BY: Kevin Koeppen, Assistant Chief of Finance W.O./G.F. NO: DIV. NO. All APPROVED BY: Joseph R. Beachem, Chief Financial Officer Mark Watton, General Manager SUBJECT: Adopt Resolution No. 2018-03 of the Otay Water District Financing Authority Amending Resolution No. 2018-02 to Authorize the Refinancing of the District’s Variable Rate Demand Certificates of Participation (1996 Capital Projects)and Increasing the Issuance Amount of the Authority’s Water Revenue Bonds, Series 2018A to an Aggregate Principal Amount Not to Exceed $36,000,000, Approving the Execution of Certain Documents and Authorizing Certain Acts in Connection Therewith GENERAL MANAGER’S RECOMMENDATION: That the Board of Directors of the Otay Water District Financing Authority (“Authority Board”) adopt Resolution No. 2018-03 amending Resolution No. 2018-02 to authorize the refinancing of the District’s Variable Rate Demand Certificates of Participation (1996 Capital Projects)and increasing the issuance amount of the Authority’s Water Revenue Bonds, Series 2018A to an aggregate principal amount not to exceed $36,000,000, and authorize the Authority President, Executive Director, Secretary, and Treasurer to approve the amendments to and execution of certain documents and authorizing certain acts in connection therewith COMMITTEE ACTION: See Attachment A. PURPOSE: To obtain Authority Board authorization to increase the issuance amount of Otay Water District Financing Authority (“Authority”) Water Revenue Bonds by $7,000,000, to include the refinancing of the District’s $6,900,000 outstanding Variable Rate Demand Certificates of Participation (“1996 Variable Rate COPS”) in addition to the funding the District’s three-year CIP Program as previously directed, and authorize the Authority President, Executive Director, Secretary, and Treasurer to amend, execute and deliver related documents and take other related actions necessary for the issuance of the 2018 Water Revenue Bonds. ANALYSIS: On September 5, 2018, the Authority Board approved the issuance of up to $29,000,000 of Water Revenue Bonds, Series 2018A to fund $28,000,000 of the District’s CIP over the next three years. Staff is recommending the bond authorization be increased to an amount not to exceed $36,000,000 and that the additional proceeds be used to refinance the District’s $6,900,000 outstanding 1996 Variable Rate COPS. Staff anticipates the required funding amount will be approximately $35,330,000, including cost of issuance. The District will not issue any more debt than is required for the two purposes. By refinancing the District’s variable rate COPS to a fixed rate the District is estimated to save over $500,000 through the original maturity date in 2026. The analysis was prepared by the District’s Financial Advisor and maintains the same maturity timing as defined in the original issuance, which fully matured in 2026. Conclusion That the Board of Directors of the Otay Water District Financing Authority adopt Resolution No. 2018-03 amending Resolution No. 2018-02 to authorize the refinancing of the District’s Variable Rate Demand Certificates of Participation (1996 Capital Projects)and increasing the issuance amount of the Authority’s Water Revenue Bonds, Series 2018A to an aggregate principal amount not to exceed $36,000,000, and authorize the Authority President, Executive Director, Secretary, and Treasurer to approve the amendments to and execution of certain documents and authorizing certain acts in connection therewith. District staff is drafting the amended documents which will, in all material respects be the same as those presented and approved by the Authority Board on September 5, 2018, except for changes to reflect the new amount of the issuance and the refinancing information. FISCAL IMPACT: Joe Beachem, Chief Financial Officer Increasing the authorized amount from up to $29,000,000 to up to $36,000,000 will save the District over $500,000 over the next eight years. STRATEGIC GOAL: The District ensures its continued financial health through long-term financial planning and debt planning. LEGAL IMPACT: None. General Manager Attachments: A) Committee Action The following attachments will be provided with the Staff Report to the Board on October 3, 2018. B) Resolution No 2018-03 C) Preliminary Official Statement ATTACHMENT A SUBJECT/PROJECT: Adopt Resolution No. 2018-03 of the Otay Water District Financing Authority Amending Resolution No. 2018-02 to Authorize the Refinancing of the District’s Variable Rate Demand Certificates of Participation (1996 Capital Projects)and Increasing the Issuance Amount of the Authority’s Water Revenue Bonds, Series 2018A to an Aggregate Principal Amount Not to Exceed $36,000,000, Approving the Execution of Certain Documents and Authorizing Certain Acts in Connection Therewith COMMITTEE ACTION: That the Finance and Administration Committee recommend the Board of Directors of the Otay Water District Financing Authority (“Authority Board”) adopt Resolution No. 2018-03 amending Resolution No. 2018-02 to authorize the refinancing of the District’s Variable Rate Demand Certificates of Participation (1996 Capital Projects)and increasing the issuance amount of the Authority’s Water Revenue Bonds, Series 2018A to an aggregate principal amount not to exceed $36,000,000, and authorize the Authority President, Executive Director, Secretary, and Treasurer to approve the amendments to and execution of certain documents and authorizing certain acts in connection therewith NOTE: The “Committee Action” is written in anticipation of the Committee moving the item forward for board approval. This report will be sent to the Board as a committee approved item, or modified to reflect any discussion or changes as directed from the committee prior to presentation to the full board. STAFF REPORT TYPE MEETING: Regular Board MEETING DATE: October 3, 2018 PROJECT: Various DIV. NO. ALL SUBMITTED BY: Adolfo Segura, Chief of Administrative Services APPROVED BY: Mark Watton, General Manager SUBJECT: FY18 YEAR-END REPORT FOR THE DISTRICT’S FY15-18 STRATEGIC PLAN GENERAL MANAGER’S RECOMMENDATION: No recommendation. This is an informational item only. COMMITTEE ACTION: Please see “Attachment A”. PURPOSE: To provide a year-end report on the District’s FY15-18 Strategic Performance Plan for FY18. ANALYSIS: Summary The current Otay Water District Strategic Plan is a four-year plan ranging from the start of FY15 through the end of FY18. This report details the year-end results for the last year of our four-year plan. Strategic Plan Objectives – Target 90% Strategic Plan objectives are designed to ensure the District is executing mission designed objectives and making the appropriate high- level changes necessary to guide the agency’s efforts to meet new challenges and positively adapt to change. FY18 year-end results are on target at 95%, with 19 of 20 active items completed or on schedule. One objective is on hold. The following objective has been put on hold: 1. Streamline Input of Operations Data – The SCADA Roadmap has been received, however, review and implementation of the plan will be incorporated into the new 4-year, 2019-2022 Strategic Plan. Performance Measures (Metrics) – Target 75% Performance measures are designed to track the District’s day-to-day performance, and are based on AWWA industry benchmarks, WAS operational standards, and core financial targets. These items measure the effectiveness and efficiency of daily operations and core services. The overall goal is that at least 75% of these measures be rated “on target”. FY18 year-end results are above target with 40 of 42 (95%) items achieving the desired level or better. Seven measures are reported at year’s end:  Enterprise Technology Services Availability  Injury Incident Rate  Debt Coverage Ratio  Reserve Level  Accounts Per FTE  Water Rate Ranking  Sewer Rate Ranking 0 2 4 6 8 10 12 14 16 18 COMPLETED ON SCHEDULE BEHIND ON HOLD 19 0 0 1 Completed On Schedule Behind On Hold 19 of 20 Active Objectives are Completed or On Schedule (95%) Items Not On Target 1. Project Closeout – Quarter four results were highly influenced by the P2534/P2544 project (133 days). Liquidated damages were assessed on this project for late delivery and the contractor was not responsive to project closeout items. 2. Direct Cost of Treatment per MGD – The year-to-date result is $1,165.82 vs. the year-to-date target of $1,050.00. The Reclamation Plant experienced process upsets and more material was used to improve effluent quality to meet regulatory compliance. 0 2 4 6 8 10 12 14 16 18 ON TARGET NOT ON TARGET 40 2 On Target Not on Target 40 of 42 Performance Measures are On Target (95%) Next Steps Kick-off of the new 4-year, 2019-2022 Strategic Plan, and track deliverables and metrics with the new ESM+ cloud-based strategic performance solution. Committee Reports – Slideshow The Strategic Plan results are presented to both the Finance and Administration Committee and the Engineering, Operations, and Water Resources Committee with a specific focus on the most relevant information for each Committee (see “Attachment B”). Strategic Plan is available on the Board VPN All of the Strategic Plan results and associated details are provided in a real-time, interactive web-based application available to the Board via secured remote access, VPN. The District Secretary can facilitate any password or access issues. FISCAL IMPACT: Joe Beachem, Chief Financial Officer Informational item only; no fiscal impact. STRATEGIC GOAL: Strategic Plan and Performance Measure reporting is a critical element in providing performance reporting to the Board and staff. LEGAL IMPACT: None. ATTACHMENTS: Attachment A – Committee Action Report Attachment B – PowerPoint Presentation 5 ATTACHMENT A SUBJECT/PROJECT: FY18 YEAR-END REPORT FOR THE DISTRICT’S FY15-18 STRATEGIC PLAN COMMITTEE ACTION: The Engineering, Operations, & Water Resources Committee met on September 18, 2018, and the Finance & Administration Committee met on September 19, 2018, to review this item. Both Committees support presentation to the full Board for their review. NOTE: The “Committee Action” is written in anticipation of the Committee moving the item forward for Board approval. This report will be sent to the Board as a committee approved item, or modified to reflect any discussion or changes as directed from the committee prior to presentation to the full Board. 1 STRATEGIC PLAN FY18 YEAR-END REPORT 2 Introduction 3 OWD Strategic Plan FY15 –FY18: The District’s Strategic Plan is developed with the Balanced Scorecard (BSC)strategic planning and management methodology,which is used and widely adopted by businesses across the globe.The BSC itself was developed by Kaplan and Norton and was originally published in 1992,in the Harvard Business Review.The model has evolved over time and is now in its fourth-generation.In brief,the BSC emphasizes alignment of business activities to the vision and strategy of the organization with goals and measures in four basic areas:financial,customer,business processes,and learning and growth. The District’s strategic plan is designed to track key organizational project objectives and essential day- to-day performance measures.Closing out the 2015-2018 Strategic Plan,staff completed 32 of 33 projects and averaged performance measure execution of 89%or better throughout the four-year plan. 4 Deliver high quality services to meet and increase confidence of the customer 1.Increase customer confidence in the District 2.Improve and expand communications 3.Provide effective water services Manage the financial issues that are critical to the District 1.Improve financial information and systems 2.Maintain District financial strength Maximize efficiency and effectiveness 1.Actively manage water supply as well as support for water and sewer services 2.Identify and evaluate improvements to enterprise and departmental business processes Provide leadership and management expertise 1.Reinforce a results-oriented and accountable culture 2.Focus on achieving a lean flexible workforce Balanced Scorecard Strategies and Goals Customer Financial Business Processes Learning & Growth $$ 5AWWA Benchmarks 1 Technical Quality Complaint Potable Water Compliance Rate Collection System Integrity Sewer Overflow Rate 2 3 4 6Objectives 95% are Completed or On Schedule 0 2 4 6 8 10 12 14 16 18 20 Completed On Schedule Behind On Hold 19 1 Completed On Schedule Behind On Hold Objective Report 20 Total 7 ON HOLD Objectives 1.Streamline Input of Operations Data 8Performance Measures 95% On Target Measure Report 42 Total 0 5 10 15 20 25 30 35 40 On Target Not on Target 40 2 On Target Not on Target 9Performance Measures 1.Project Closeout Time 2.Direct Cost of Treatment per MGD NOT ON TARGET 10 Year-End Results Administrative Services 11Enterprise Technology Services Availability Target: No less than 99.5%availability per quarter in a year Annual Average:3.60 hours of downtime per month/1.83 days of downtime in a year 99.5 99.5 99.5 99.5 99.5 98 98.5 99 99.5 100 100.5 Q1 Q2 Q3 Q4 YTD Target 2016 2017 2018 Measurement Method 12Employee Turnover Rate Target: Less than 5%turnover in a year # of voluntary resignations (not including retirements)/average # of employees 0 0 0.75 0.75 1.50 0 1 2 3 4 5 6 Q1 Q2 Q3 Q4 YTD Target 2016 2017 2018 Measurement Method 13Training Hours Per Employee Target: 12 hours of general formal training per employee in a year (excludes safety training) Total qualified training hours for all employees/average # of FTEs 4.94 5.50 3.91 3.77 18.11 0 5 10 15 20 25 Q1 Q2 Q3 Q4 YTD/AVG Target 2016 2017 2018 Measurement Method 14Safety Training Program Target: 24 hours of safety training per field employee in a year # of safety training hours for the quarter/ # of field employees 6.50 11.14 5.43 11.45 30.38 0 5 10 15 20 25 30 35 40 Q1 Q2 Q3 Q4 YTD/AVG Target 2016 2017 2018 Measurement Method 15Injury Incident Rate Target: Be at or below the National Average for Utilities-Water Sewage and other Systems A rate of 6.80 or less work-related injuries and illnesses 4.4 4.4 0 1 2 3 4 5 6 7 8 Q4 AVG Target 2017 2018 Annual Average:Number of injuries and illnesses (200,000) / Employee hours workedMeasurement Method 16 Engineering 17CIP Project Expenditures vs. Budget Target: 95% of budget but not to exceed 100%in a year Being below target gives the measure a “not on target” status Actual quarterly expenditures/Annual budget 9.3 19.5 39.8 29.8 97.4 0 20 40 60 80 100 120 Q1 Q2 Q3 Q4 YTD Target 2016 2017 2018 Measurement Method 18Construction Change Order Incidence (w/o allowances) Target: No more than 5%per quarter in a year 0.1 0.5 1.6 1.3 1.3 0 1 2 3 4 5 6 Q1 Q2 Q3 Q4 YTD Target 2016 2017 2018 Measurement Method Total cost of Change Orders (not including allowances)/ Total original construction contract amount (not including allowances) 19 Mark-Out Accuracy Target: No less than 100%mark-out accuracy per quarter in a year 100 100 100 100 100 0 20 40 60 80 100 120 Q1 Q2 Q3 Q4 YTD Target 2016 2017 2018 # of mark-outs performed without an at-fault hit, which is damage to a District facility that results from a missing or erroneous mark- out/Total # of mark-outs performed Measurement Method *FY15 –FY17 results are 100% 20Project Closeout Time Target: No more than a 45 day average per quarter in a year 0 64.5 21 131 70.3 0 20 40 60 80 100 120 140 Q1 Q2 Q3 Q4 YTD Target 2016 2017 2018 # of days between NOSC and NOC for all construction projects within the quarter/# of construction projects within the quarter Measurement Method 21Annual Recycled Water Site Inspections Target: 100%of recycled sites inspected in a year (There are 153 recycled water use sites scheduled for FY18) Cumulative % of recycled sites inspected per quarter of those required by DEH 28.75 54.90 77.12 100 100 0 20 40 60 80 100 120 Q1 Q2 Q3 Q4 YTD Target 2016 2017 2018 Measurement Method 22Recycled Water Shutdown Testing Target: No less than 90%of recycled site shut down tests in a year (There are 39 recycled water use sites due for shutdown in FY18) Cumulative % of recycled site shutdown tests performed per year compared to those scheduled 28 49 69 86 86 0 10 20 30 40 50 60 70 80 90 100 Q1 Q2 Q3 Q4 YTD Target 2016 2017 2018 Measurement Method 23 Finance 24 # of all calls answered/ # of all calls received during a quarter Answer Rate Target: No less than 97%average answer rate per quarter in a year 97.82 97.27 98.20 98.66 98.00 95 95.5 96 96.5 97 97.5 98 98.5 99 Q1 Q2 Q3 Q4 YTD Target 2016 2017 2018 Measurement Method 25 Total operations O&M costs/ # of accounts O&M Cost Per Account Target: Less than $561.00 per account in a single year (Target is based on Operating Budget) Measurement Method 117 265 392 549 549 100 150 200 250 300 350 400 450 500 550 600 Q1 Q2 Q3 Q4 YTD Target 2016 2017 2018 26 # of correct bills during the reporting period/ # of total bills during the reporting period Billing Accuracy Target: No less than 99.8%billing accuracy per quarter in a year 99.97 99.99 99.99 99.98 99.98 98 98.5 99 99.5 100 100.5 Q1 Q2 Q3 Q4 YTD Target 2016 2017 2018 Measurement Method 27Overtime Percentage Target: Less than 100%of budgeted overtime per quarter in a year (target is based on Operating Budget; FY18 Overtime Budget is $133,800) Actual overtime costs (including comp time)/ Budgeted overtime costs 103 117 91 89 100 0 20 40 60 80 100 120 140 160 180 200 Q1 Q2 Q3 Q4 YTD Target 2016 2017 2018 Measurement Method 28Sewer Rate Ranking Target: Bottom 50 percentile for the 28 sewer service providers in San Diego (Otay ranks 6 out of 28 sewer service providers) 6 6 0 5 10 15 20 25 Q4 YTD Target 2016 2017 2018 Otay ranking for the average bill for sewer/ # of sewer agenciesMeasurement Method 29Water Rate Ranking Target: Bottom 50 percentile for the 22 member agencies in San Diego (Otay ranks 3 out of 22 member agencies) Otay ranking for the average water bill among CWA member agencies 3 30 2 4 6 8 10 12 14 Q4 YTD Target 2016 2017 2018 Measurement Method 30Debt Coverage Ratio Target: Above 150%to have sufficient debt coverage (This is measured at year end) Qualified net operating revenues/debt service requirements (measured at year end) 200 200 0 50 100 150 200 250 300 Q4 YTD Target 2016 2017 2018 Measurement Method 31Reserve Level Target: Equal or exceed 85% (This is measured at year end) # of reserve funds that meet or exceed fund target levels/ Total # of reserve funds 100 100 0 20 40 60 80 100 120 140 Q4 YTD Target 2016 2017 2018 Measurement Method 32Percent of Customers Paying Bills Electronically Target: No less than 75%per quarter in a year # of customers paying bills electronically/ Total # of customersMeasurement Method 76.95 76.78 76.74 77.75 77.05 0 10 20 30 40 50 60 70 80 90 100 Q1 Q2 Q3 Q4 YTD Target 2016 2017 2018 33Distribution System Loss Target: Less than 5%of unaccounted water loss per quarter in a year 100 [volume purchased (from CWA) –(volume sold (to customers) + volume used District usage)] / volume purchased (from CWA))Measurement Method 4.1 4 3.5 3.3 3.3 0 1 2 3 4 5 6 7 8 9 10 Q1 Q2 Q3 Q4 YTD Target 2016 2017 2018 34 Operations 35Technical Quality Complaint (AWWA) Target: No more than 9 complaints per 1000 customer accounts in a year 1000 (# of technical quality complaints per quarter)/# of active customer accounts per reporting period AW W A B e n c h m a r k Measurement Method 1.49 1.19 0.79 0.75 4.2 0 1 2 3 4 5 6 7 8 9 10 Q1 Q2 Q3 Q4 YTD Target AWWA 2016 2017 2018 AW W A B e n c h m a r k 36Planned Potable Water Maintenance Ratio in $ Target: 66% or greater of all labor dollars spent on preventative maintenance per quarter in a year Total planned maintenance cost/ Total maintenance costMeasurement Method 72 72 74 72 72 50 55 60 65 70 75 80 85 90 95 100 Q1 Q2 Q3 Q4 YTD Target 2016 2017 2018 37 Total planned maintenance costs/Total maintenance costs Planned Recycled Water Maintenance Ratio in $ Target: 70%or greater of all labor spent on preventative maintenance per quarter in a year Measurement Method 70 64 79 84 74 0 20 40 60 80 100 120 Q1 Q2 Q3 Q4 YTD Target 2016 2017 2018 38Planned Wastewater Maintenance Ratio in $ Target: 77% or greater of all labor dollars spent on preventative maintenance per quarter in a year Total planned maintenance cost/Total maintenance costMeasurement Method 67.72 96.38 84.65 83.33 82.47 50 55 60 65 70 75 80 85 90 95 100 Q1 Q2 Q3 Q4 YTD Target 2016 2017 2018 39Direct Cost of Treatment Per MGD Target: No more than $1050 per MG spent on wastewater treatment per quarter in a single year (Targets each quarter will vary based on high and low demand times) Total O&M costs directly attributable to sewer treatment/ Total volume in MGMeasurement Method 1238.54 1573.51 1049.65 956.96 1165.82 0 200 400 600 800 1000 1200 1400 1600 1800 Q1 Q2 Q3 Q4 YTD Target 2016 2017 2018 40O&M Cost Per MG Processed of Wastewater Target: No more than $1925 per MG spent on O&M for wastewater treatment in a year (Targets each quarter will vary based on high and low demand times) Total O&M cost/ MGP FYTD O&M Cost = (Power Cost) + (Staff Cost) + (Equipment Cost) / FYTP MGP Measurement Method 1978.39 1825.90 1171.80 1309.21 1534.73 0 500 1000 1500 2000 2500 Q1 Q2 Q3 Q4 YTD Target 2016 2017 2018 41Leak Detection Program Target: Perform leak detection on 20%of potable distribution system %of potable distribution pipelines surveyed. The calculation is miles of pipe surveyed divided by total miles of pipe times 100. 20 20 0 10 20 30 40 50 60 70 80 90 100 Q3 YTD Target 2016 2017 2018 Measurement Method *FY15 –FY16 results are 20% 42Percent of PMs Completed –Fleet Maintenance Target: No less than 90%of scheduled PM’s completed per quarter in a year # of PM’s completed/ # of PM’s scheduled to be completed Measurement Method 100 100 100 100 100 0 20 40 60 80 100 Q1 Q2 Q3 Q4 Annual Target 2016 2017 2018 *FY16 &FY17 results are 100% 43Percent of PMs Completed –Reclamation Plant Target: No less than 90%of scheduled PM’s completed per quarter in a year # of PM’s completed/ # of PM’s scheduled to be completed in a reporting period Measurement Method 100 95 100 97 98 75 80 85 90 95 100 105 110 Q1 Q2 Q3 Q4 YTD Target 2016 2017 2018 44Percent of PMs Completed –Pump/Electric Section Target: No less than 90%of scheduled PM’s completed per quarter in a year # of PM’s completed/ # of PM’s scheduled to be completed in a reporting periodMeasurement Method 100 100 100 100 100 75 80 85 90 95 100 105 110 Q1 Q2 Q3 Q4 YTD Target 2016 2017 2018 *FY15 –FY17 results are 100% 45System Valve Exercising Program Target: Exercise 770 valves per quarter or 3080 valves by the end of fiscal year Actual number of valves exercised in the reporting periodMeasurement Method 974 775 859 797 3405 0 1000 2000 3000 4000 5000 6000 Q1 Q2 Q3 Q4 YTD Target 2016 2017 2018 46Potable Water Distribution System Integrity Target: No more than 16 leaks and breaks per 100 miles of distribution piping in a year 100 (annual total number of leaks + annual total number of breaks) / total miles of distribution pipingMeasurement Method 3.26 1.82 2.01 2.39 9.50 0 2 4 6 8 10 12 14 16 18 20 Q1 Q2 Q3 Q4 YTD Target 2016 2017 2018 47Potable Water Compliance Rate (AWWA) Target: No less than 100%of all health related drinking water standards each quarter in a year 100 (# of days the primary health regulations are met)/ # of days in the reporting periodMeasurement Method 100 100 100 100 100 50 60 70 80 90 100 110 Q1 Q2 Q3 Q4 YTD Target AWWA 2016 2017 2018 AW W A B e n c h m a r k *FY15 –FY17 results are 100% 48Collection System Integrity (AWWA) Target: No more than 3.6 system failures per 100 miles of collection system pipeline in a year 100 (total number of collection system failures during the year) / total miles of collection system pipingMeasurement Method 0 0 0 0 0 0 1 2 3 4 5 6 7 8 Q1 Q2 Q3 Q4 YTD Target AWWA 2016 2017 2018 *FY15 –FY16 had 0 system failures AW W A B e n c h m a r k 49Recycled Water System Integrity Target: No more than 6.6 leaks or breaks per 100 miles of recycled distribution system in a year (100 x # of leaks or breaks)/ # of miles of distribution systemMeasurement Method 0.89 0 0.89 0.89 2.67 0 1 2 3 4 5 6 7 Q1 Q2 Q3 Q4 YTD Target 2016 2017 2018 50Sewer Overflow Rate (AWWA) Target: 0 overflows per quarter in a year 100 (total number of sewer overflows during the reporting period) / total miles of pipe in the sewage collection systemMeasurement Method 0 0 0 0 0 0 1 2 3 4 5 6 7 8 Q1 Q2 Q3 Q4 YTD Target AWWA 2016 2017 2018 AW W A B e n c h m a r k *FY 15 –FY 16 results are 0 overflows 51Emergency Facility Power Testing Target: 100%of the District’s facilities tested per year (The District currently has 34 powered ready facilities) Number of facilities tested / total facilities Measurement Method 29 47 76 106 106 0 20 40 60 80 100 Q1 Q2 Q3 Q4 YTD Target 2016 2017 2018 52Tank Inspection and Cleaning Annual Target: Clean and inspect 7 tanks or more per year Number of tanks cleaned and inspectedMeasurement Method 1 4 2 0 8 0 2 4 6 8 10 12 14 Q1 Q2 Q3 Q4 YTD Target 2016 2017 2018 53Main Flushing and Fire Hydrant Maintenance Target: 215 or more mains flushed and fire hydrants maintained in a single year (The target of 215 is comprised of 165 hydrants and 50 mains) Number of mains flushed and hydrants maintainedMeasurement Method 50 141 131 121 443 0 100 200 300 400 500 600 700 800 900 1000 Q1 Q2 Q3 Q4 YTD Target 2016 2017 2018 54Critical Valve Exercising Target: Exercise 631 identified critical valves in a year Number of critical valves exercised in a reporting periodMeasurement Method 625 6 2 0 633 0 100 200 300 400 500 600 700 800 900 1000 Q1 Q2 Q3 Q4 YTD Target 2016 2017 2018 55 Next Steps 56 1 Kick-off of the 2019-2022 Strategic Plan Track deliverables and metrics with the new ESM+ cloud- based strategic performance solution2