Joint Powers Authority Member Entities: Boronda County Sanitation District, Castroville Community Services Water District, County of Monterey, Del Rey Oaks, Fort Ord, Marina Coast Water District,

Monterey, Moss Landing County Sanitation District, Pacific Grove, Salinas, Sand City, and Seaside.

AGENDA

BUDGET/PERSONNEL COMMITTEE (BPC)

Rudy Fischer, Chair Dennis Allion, Gloria De La Rosa, Peter Le

[Alternate – Linda Grier]

DATE: Friday, August 14, 2015

TIME: 12:30 p.m.

LOCATION: Admin Conference Room 5 Harris Court, Building D

1. CALL TO ORDER

2. ROLL CALL

3. PUBLIC COMMENTS Anyone wishing to address the Committee on matters not appearing on the Agenda may do so now. Comments on any other matter listed on the Agenda are welcome at the time the matter is being considered by the Committee.

4. APPROVE JULY 10, 2015 BPC MINUTES

5. UPDATE ON APPLICATION PROCESS FOR SPECIAL DISTRICTS TRANSPARENCY CERTIFICATE OF EXCELLENCE

6. EVALUATE ANY DIRECT BANKING PROPOSALS FOR A LINE OF CREDIT; AND APPROVE AN ADDITIONAL APPROPRIATION TO FUND PROFESSIONAL SERVICES TO SECURE A LINE OF CREDIT

7. STAFF MEMBER COMMENTS

8. COMMITTEE MEMBER COMMENTS Committee Members may ask a question for clarification, make a brief announcement or make a brief comment or report on his or her own activities within the jurisdiction of the committee. No discussion or action is appropriate other than referral to staff for consideration or setting a matter as a future agenda item.

9. ADJOURNMENT

Joint Powers Authority Member Entities: Boronda County Sanitation District, Castroville Community Services Water District, County of Monterey, Del Rey Oaks, Fort Ord, Marina Coast Water District, Monterey,

Moss Landing County Sanitation District, Pacific Grove, Salinas, Sand City, and Seaside.

C O M M I T T E E M I N U T E S / R E P O R T

BUDGET/PERSONNEL COMMITTEE

Friday, July 10, 2015 12:30 pm to 1:51 pm

5 Harris Court, Building D

Monterey, California

1. CALL TO ORDER

2. ROLL CALL

3. PUBLIC COMMENTS

4. APPROVE JUNE 12, 2015 BPC MINUTES

5. UPDATE ON ASSISTANT GENERAL MANAGER RECRUITMENT

6. APPROVE SOLE-SOURCE CONTRACT FOR SEASIDE PUMP STATION DRIVES PROJECT

7. CONSIDER STANDARDIZED PURCHASES OF VARIABLE FREQUENCY DRIVES MANUFACTURED BY ALLEN BRADLEY FOR THE NEXT FIVE YEARS

8. UPDATE ON SHARED SERVICES STUDY WITH MONTEREY REGIONAL WASTE MANAGEMENT DISTRICT (MRWMD)

9. CONSIDER APPLICATION FOR DISTRICT TRANSPARENCY CERTIFICATE OF EXCELLENCE

10. STAFF MEMBER COMMENTS

11. COMMITTEE MEMBER COMMENTS

12. RECESS TO CLOSED SESSION

A. Public Employee Appointment – Assistant General Manager

13. POSSIBLE ACTION ON CLOSED SESSION ITEM

14. ADJOURNMENT

DRAFT

These minutes presented for approval by the committee at the

August 14 BPC meeting.

BUDGET/PERSONNEL COMMITTEE DRAFT July 10, 2015 Page 2 of 6 PRESENT: Budget/Personnel Committee

Rudy Fischer, Chair Dennis Allion Gloria De La Rosa Linda Grier (Alternate)

ABSENT:

Peter Le

PRESENT: MRWPCA Staff:

Paul Sciuto General Manager

Rob Wellington Legal Counsel

Tori Hannah Chief Financial Officer

Leara Sampson HR Administrator

Jennifer Gonzalez Engineering Manager

Cheryl Rogers Administrative Support Specialist

Betty Nebb Executive Assistant

OTHERS PRESENT: None

3. PUBLIC COMMENTS At 12:31 am, Chair Fischer called for Public Comments; none received.

4. APPROVE JUNE 12, 2015 BPC MINUTES

Chair Fischer stated that the June 12, 2015 draft BPC minutes are presented to the BPC for their approval.

ACTION TAKEN: On a motion by Mr. Allion, seconded by Ms. De La Rosa, the Budget/Personnel Committee unanimously approved the June 12, 2015 BPC Minutes. [Yes: Fischer, Allion, and De La Rosa] [Abstained: Grier] [Absent: Le]

5. UPDATE ON ASSISTANT GENERAL MANAGER RECRUITMENT

Ms. Sampson reported on the progress of the AGM recruitment. She explained that staff met with Pam Derby, Senior Consultant from CPS HR, on June 9 to consider the results of the preliminary screening of the candidates. Out of 31 resumes submitted, six candidates were chosen to be interviewed by a technical and a management interview panel of staff that included an external panel member, Mr. William Kocher, MCWD Interim General Manager. Following those interviews, the top two candidates for the position were identified and interviewed

BUDGET/PERSONNEL COMMITTEE DRAFT July 10, 2015 Page 3 of 6

a final time with selected staff members. One candidate interviewed yesterday, July 9; the second interviewed earlier today. Mr. Sciuto stated that he was acquainted with both candidates through the industry and by reputation and felt confident about having two well-qualified choices for the position. He added that the qualifications of each candidate would be discussed in Closed Session and that a decision was likely to be made within a week.

Information only – No action is required.

6. CONSIDER CONTRACT FOR SEASIDE PUMP STATION DRIVES REPLACEMENT PROJECT (CP290) Ms. Gonzalez provided background and explained the need for replacing four (4) 600 HP DC Drives at the Seaside pump station. She explained that the drives are the original drives installed when the pump station was built in 1984 and have reached the end of their useful life. A similar project was completed last year for the Ft. Ord pump station and some parts were salvaged that have been used for the Seaside pump station drives. Replacement of these DC drives is necessary to update the technology of the drives and to make this pump station reliable again. Ms. Gonzalez stated that the SCADA equipment at the Regional Treatment Plant (RTP) and the majority of the Agency pump stations have been standardized on the Allen Bradley platform. Therefore, staff requests approval of a contract with Buckles-Smith/Rockwell Automation to perform the drives replacement work at the Seaside pump station in the amount of $284,721.75. She also recommends sole sourcing and sole branding the drives for the following reasons:

One type of drive decreases costs for stocking spare parts

Allen Bradley (AB) drives are compatible with AB control system – other drive manufacturers would have to modify installed drives to integrate into the existing control system

MRWPCA staff has experience and are trained to work on AB drives

MRWPCA currently has spare parts that could be used for the AB drives in the future

Buckles-Smith/Rockwell Automation is very familiar with the work needed for the Seaside pump station since they worked on the Ft. Ord pump station project.

During discussion, Mr. Allion noted that while the contract cost is less than the budgeted amount for the project, he asked if staff costs are included in the budget. Ms. Gonzalez stated that staff costs are part of the total budget for the

BUDGET/PERSONNEL COMMITTEE DRAFT July 10, 2015 Page 4 of 6

project and she expects labor costs to be less on this project since staff has had recent experience completing similar work for the Ft. Ord project.

ACTION TAKEN: On a motion by Ms. De La Rosa, seconded by Ms. Grier, the Budget/Personnel Committee recommends that the Board approve Resolution 2015-XX, authorizing the purchase of four (4) Allen Bradley 600 HP DC Drives without formal competitive bidding; and, approve a contract with Buckles-Smith/Rockwell Automation to perform the Seaside Pump Station Drives Replacement Project with Allen Bradley Drives in the amount of $284,721.75. [Yes: Fischer, Allion, De La Rosa, and Grier] [Absent: Le]

7. CONSIDER RESOLUTION No. 2015-XX WHICH AUTHORIZES

STANDARDIZED PURCHASES OF VARIABLE FREQUENCY DRIVES (VFDs) MANUFACTURED BY ALLEN BRADLEY FOR THE NEXT FIVE YEARS Ms. Gonzalez stated that over the next five years, the Agency will need to replace, at a minimum, 15 Variable Frequency Drives (VFDs) at our pump stations and an equal number at the RTP. Allen Bradley is one of the leaders in the industry and by standardizing these purchases with one manufacturer, the Agency will be able to save operational funds on both training and on cost for spare parts. Ms. Gonzalez added that there are few drives manufactured that are compatible with Agency pumps and SCADA equipment at our facilities; Allen Bradley meets the Agency’s requirements. The resolution being considered will allow staff to purchase AB equipment from Buckles-Smith/Rockwell Automation, the only manufacturer-authorized local representative (sole source) for Allen Bradley, located in San Ramon, California. This firm is very reliable and very competitive in their pricing. They have successfully performed work at our RTP and pump stations including the Fort Ord Pump Station Drives Replacement Project last fiscal year. Approving this Resolution will allow staff to sole-source these purchases; however, Ms. Gonzalez noted that any purchases over $35,000 would come to the Board for approval.

ACTION TAKEN: On a motion by Ms. Grier, seconded by Mr. Allion, the Budget/Personnel Committee recommends that the Board approve Resolution No. 2015-XX, authorizing staff to standardize purchase of Allen Bradley VFDs as a sole brand and transition all VFD purchases, when possible, to Allen Bradley platforms with sole sourcing to Buckles-Smith/Rockwell Automation, the only manufacturer-authorized representative of Allen Bradley VFDs in Northern California, for the next five years starting with FY15/16. [Yes: Fischer, Allion, De La Rosa, and Grier] [Absent: Le]

BUDGET/PERSONNEL COMMITTEE DRAFT July 10, 2015 Page 5 of 6 8. UPDATE ON SHARED SERVICES STUDY WITH MONTEREY REGIONAL

WASTE MANAGEMENT DISTRICT (MRWMD) Mr. Sciuto explained this draft report is a result of discussions with MRWMD to seek out opportunities for shared job functions or collaborative processes to improve operational or administrative efficiencies. To facilitate this development, MRWPCA requested a proposal from BHI Management Consulting to work with both agencies to set up a shared service pilot program. Mr. Allion stated that he has been an advocate for considering this approach and noted the current positions between the two agencies. Mr. Sciuto explained there are details to be considered and further study is needed before anything is formalized. Discussion followed regarding the differences in organizational structure (a Special District and a Joint Powers Authority); and Mr. Wellington stated that difference would have no effect on creating a joint agreement for shared services. Mr. Sciuto added that there is a history between our organizations of sharing services in maintenance and safety operations. He added that he has scheduled a phone conference with Mr. Tim Flanagan and the Consultant to review this draft report. An error in staffing levels in the report was noted, and Mr. Sciuto stated a final report will likely be available in September.

Information only – No action is required.

9. CONSIDER APPLICATION FOR AGENCY TRANSPARENCY CERTIFICATE OF EXCELLENCE Mr. Sciuto stated that California Special Districts Association (CSDA) has a leadership foundation that has created a certification program to recognize efforts by special districts to promote transparency in operations and governance. He reviewed several of the requirements for the certification and noted that there are many areas where the Agency is already in compliance. He noted some administrative/Board procedures that comply with the requirements, but are not formalized in written policy. A formal policy regarding Public Records Requests and policies related to conduct of Board meetings and agenda notices (Brown Act) will be drafted by staff, reviewed by legal counsel and submitted to the Board for review prior to submission of the Special District Leadership Foundation application. Mr. Fischer suggested this would be an opportunity to review Board members’ bio information and update the website. He also noted that the ethics training course for Board members is also required for all elected officials. Mr. Wellington offered that the training is available on-line, but can also be fulfilled by attending the ethics training course offered by CASA at their Annual Conference that will be held in Monterey in September. Ms. Grier asked about staff time to prepare this information, and Mr. Sciuto estimated it may take about 40 hours; however, two Districts in our area have completed the process and have offered assistance for the application process.

BUDGET/PERSONNEL COMMITTEE DRAFT July 10, 2015 Page 6 of 6

Information only – No action is required.

10. STAFF MEMBER COMMENTS Mr. Sciuto suggested that since there are often budget questions when the Committee is considering a contract, staff will look into options to provide that budget information in a straightforward manner on the staff memo. Additionally, Mr. Sciuto asked about the possibility to eliminate a full review of Committee information at the Board meeting. After some discussion, the BPC was in agreement that there may be a more efficient way to report out the Committee actions. It was suggested that information only items could be summarized in the Board packet while recommended actions from the BPC could be reported out more completely. Mr. Sciuto stated that the July Board meeting process would likely remain similar to previous meetings; however, he welcomes the opportunity to implement some changes that will streamline future Board meetings.

11. COMMITTEE MEMBER COMMENTS Nothing to report.

[At 1:14 pm, Chair Fischer recessed to Closed Session.]

12. RECESSED TO CLOSED SESSION A. Public Employee Appointment – Assistant General Manager

13. POSSIBLE ACTION ON CLOSED SESSION ITEM

Mr. Wellington, Legal Counsel, reported that the Committee came back into Open Session at 1:50 pm. Information was provided to the Committee; no reportable action was taken.

14. ADJOURNMENT At 1:51 pm, with no further business, Chair Fischer adjourned the

Budget/Personnel Committee meeting to the next regularly scheduled Budget/Personnel Committee meeting on Friday, August 14, 2015 at 12:30 pm.

Monterey Regional Water Pollution Control Agency “Dedicated to meeting the wastewater and recycled water needs of our member agencies, while protecting the environment.”

Joint Powers Authority Member Entities: Boronda County Sanitation District, Castroville Community Services District, County of Monterey, Del Rey Oaks, Fort Ord, Marina Coast Water District, Monterey,

Moss Landing County Sanitation District, Pacific Grove, Salinas, Sand City, and Seaside.

BUDGET/PERSONNEL COMMITTEE

August 14, 2015

INFORMATION ITEM

UPDATE ON APPLICATION PROCESS FOR SPECIAL DISTRICTS TRANSPARENCY CERTIFICATE OF EXCELLENCE

From: Paul Sciuto General Manager

Approval: GM Legal CFO

────────────────────────────────────────────────────── Special District Leadership Foundation (SDLF) has created a certification program to recognize efforts to promote transparency in the operations and governance of special districts to the public and to provide special districts with an opportunity to showcase their efforts in transparency. While many of the requirements for the application are complete, there are several that will be updated on our website. Some website maintenance is necessary and will be completed in the next week or two. A couple of administrative/Board procedures that comply with the requirements, but were not formalized in written policy, have now been submitted to the Board, approved, and will be posted on our website: Public Records Request Act and Brown Act requirements for Board meetings and agenda notices. Board member assistance is needed in order to fulfill the requirements that all members must have a current ethic training certificate on file with our Agency. Entities have been very cooperative to forward current certificates. For those members who have do not have a current certificate (within last two years), the online course through the state is available and can be completed quickly to satisfy this requirement. Staff is hopeful to complete the application in time to be recognized at the upcoming 2015 California Special Districts Association Annual Conference held this year in Monterey, September 21-24, 2015.

* * * * * *

Monterey Regional Water Pollution Control Agency “Dedicated to meeting the wastewater and recycled water needs of our member agencies, while protecting the environment.”

Joint Powers Authority Member Entities: Boronda County Sanitation District, Castroville Community Services District, County of Monterey, Del Rey Oaks, Fort Ord, Marina Coast Water District, Monterey,

Moss Landing County Sanitation District, Pacific Grove, Salinas, Sand City, and Seaside.

BUDGET/PERSONNEL COMMITTEE

August 14, 2015

ACTION ITEM

EVALUATE ANY DIRECT BANKING PROPOSALS FOR A LINE OF CREDIT; AND APPROVE AN ADDITIONAL APPROPRIATION TO FUND PROFESSIONAL

SERVICES TO SECURE A LINE OF CREDIT From: Tori Hannah Chief Financial Officer

Approval: GM Legal CFO

────────────────────────────────────────────────────────────────

Background: Kennedy Jenks, an engineering consulting firm, recently prepared a report estimating monthly expenditures for the Groundwater Replenishment Project. During peak construction periods, it was projected that expenses could rise as high as $5 million a month. The primary financing for this project is anticipated to come from the State Revolving Loan Fund. State Revolving Loans are processed on a reimbursement basis, with the Agency only receiving cash after purchases are made. While staff anticipates requesting reimbursements on a monthly basis, delays could occur due to the processing time. This could impact the Agency’s operating cash flow. Staff incorporated the projected expenditures into a three year cash flow model to assist in identifying cash flow needs. The initial projection indicated that an additional $10 million may be needed to assist with cash flow needs during peak construction periods. Staff contacted the Agency’s existing bank to review line of credit options; however they have not committed to providing a response. In addition, two additional banks were contacted; however both banks indicated a proposal would be contingent upon transferring banking services. Both banks indicated they may submit a proposal prior to the Board date. If a proposal is received, the loan package could be benchmarked against recent debt issues for comparative purposes. As an alternative, staff received a

Budget/Personnel Committee Proposals for Line of Credit August 14, 2015 Page Two

proposal from a financial advisor to develop loan specifications, solicit offers, and negotiate any agreements. The amount of this proposal is $25,000. Staff has also received a proposal from Bond Counsel for $15,000 to prepare the necessary legal documents. Bond Counsel services would be needed for a direct bank loan or a loan received through a financial advisor. Fiscal Impact: Funding for bond counsel and the financial advisor were not included in the FY 15/16 Budget. An additional appropriation from General Fund Reserves would be needed to pay for these services. Sufficient funds are available in the General Fund Reserves. RECOMMENDATION: That the Budget/Personnel Committee recommends Board approval for appropriation for $40,000 to fund financial advisor and bond counsel services; however, if direct banking options are determined to be viable, approve $15,000 to fund bond counsel services and further evaluate banking proposals. The determination of whether to proceed with the direct banking option would depend on the proposals for a direct line of credit.