DOMESTIC WATER POLICY COMMITTEE MODESTO IRRIGATION DISTRICT 1231 Eleventh Street, Modesto, California April 6, :30 a.m.

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1 John Mensinger, Chairman, MID Bill Zoslocki, Vice-Chairman, City of Modesto Nick Blom, Board Member, MID Ted Brandvold, Mayor, City of Modesto DOMESTIC WATER POLICY COMMITTEE MODESTO IRRIGATION DISTRICT 1231 Eleventh Street, Modesto, California April 6, :30 a.m. AGENDA ITEMS THE PUBLIC IS INVITED TO COMMENT ON ANY ITEM, WHICH IS LISTED ON THE AGENDA AT THE TIME THAT ITEM IS BEING DISCUSSED. ANY PERSON WISHING TO ADDRESS THE COMMITTEE WILL BE LIMITED TO 5 MINUTES UNLESS PRIOR ARRANGEMENTS HAVE BEEN MADE OR UPON THE CONSENT OF THE COMMITTEE CHAIR. Item No. Tab No. 1. CALL TO ORDER 2. ROLL CALL 3. PUBLIC COMMENT APPROVE MEETING MINUTES JANUARY 5, JOHN DAVIDS TRANSFER OF 2016 BUDGET SURPLUS TO THE RESERVE AND CONTINGENCY FUND FOR ENGINEERING AND CONSTRUCTION SUPPORT SERVICES RELATED TO ONGOING O&M AT THE MODESTO REGIONAL WATER TREATMENT PLANT AND PROCURING THE SERVICES OF A SAFETY CONSULTANT TO PREPARE LOCK OUT TAG OUT PROCEDURES, PERFORM JOB HAZARD ANALYSES, AND ASSESS PERSONAL PROTECTIVE EQUIPMENT JOHN DAVIDS 2017 POLICY COMMITTEE OFFICERS DISCUSSION AND POSSIBLE ACTION 7. GREG WILLIAMS DOMESTIC WATER PROJECT UPDATE 8. PROPOSED FUTURE POLICY COMMITTEE MEETINGS July 6, 2017, MODESTO REGIONAL WATER TREATMENT PLANT 8:30 A.M. 9:30 A.M. 9. ADJOURNMENT October 5, 2017, MID BOARD ROOM 8:30 A.M. 9:30 A.M.

2 Tab No. 1 Present: Absent: John Mensinger, Chairman, MID Bill Zoslocki, Vice-Chairman, City of Modesto Nick Blom, Board Member, MID Mayor Ted Brandvold, City of Modesto None Item No. DRAFT DOMESTIC WATER POLICY COMMITTEE Meeting Minutes January 5, Call to Order Chairman John Mensinger called the meeting to order at 8:32 a.m. 2. Roll Call Roll Call was taken. A quorum was present. 3. Public Comment None. 4. Approve Meeting Minutes October 20, 2016 Chairman Mensinger called for a motion to approve the minutes of the October 20, 2016 Policy Committee meeting. Board Member Blom moved to approve. Vice-Chairman Zoslocki seconded the motion. The motion passed unanimously. 5. Discuss The Potential Transfer Of 2016 Budget Surplus To The Reserve And Contingency Fund For Carollo Support Services Related To Ongoing O&M At The Modesto Regional Water Treatment Plant And Procuring The Services Of A Safety Consultant To Prepare Lock Out Tag Out Procedures, Perform Job Hazard Analyses, And Assess Personal Protective Equipment Pat reviewed that there are funds left over from the 2016 Domestic Water Budget that are unspent. There are also several projects remaining to complete as part of the Miscellaneous Improvement Project for the membrane plant which weren t completed in 2016 as initially envisioned. Once all expenditures have been submitted for the year, MID s Finance Department will do a final accounting which should be complete around March The final accounting includes a true up of revenues and expenditures. In 2016, revenue from the City exceeded expenditures due to not having a full allocation of water (MID always budgets for a full allocation), staff vacancies and retirements. At this time, it appears there will be close to $2M remaining in the 2016 budget. Normally that would go back to the City as an offset against their first few payments for Pat continued that the thought is to take that money and roll it into the Reserve and Contingency (R&C) Fund, which is an existing fund that MID holds. This is an interest-bearing account that was set up for

3 Tab No. 1 unbudgeted emergencies to cover the projects which weren t completed in 2016 as envisioned. Pat continued that it wouldn t have an impact on rates because they are funds already paid for in 2016 and contemplated in the rate structure. Pat then asked Thomas Hedergard if that statement was correct and he concurred. Pat confirmed that this was being presented to the Policy Committee at this time for discussion only and that to the extent the Policy Committee found merit in the request, staff would bring the item back for action at the next Policy Committee meeting. The Technical Committee previously took action to concur with the approach at the December 21, 2016 Technical Committee meeting. There is nothing in the ARTDA that contemplates this situation. He continued that it was uncertain what mechanism would be used to transfer the funds. He continued that he thought the attorneys could determine how to complete the transfer. Board Member Blom asked about the costs for the two unbudgeted projects. Pat responded that the Carollo engineering services include Electronic Operations and Maintenance manuals (EOMs) for both the conventional and membrane plants. The cost is estimated at approximately $350,000. There are also record drawings and construction costs for the manways. Mayor Brandvold asked for verification of using emergency funds for unbudgeted projects. Pat replied that the ARTDA states that this fund is also for unbudgeted/unplanned expenditures. He continued that when the 2017 budget was put together this work was anticipated but uncertain that it could be completed in 2017, nor were costs known. John Davids added that the idea isn t to utilize existing monies in the fund, but to use the fund as a mechanism to not return the excess budget funds to the City so that we can then use those funds during Mayor Brandvold then asked if a decision is anticipated at the April meeting. Pat added that it may require a special meeting between now and April and would look to the Policy Committee for direction as to a special meeting or wait until April. Pat continued that there is now $1M in the contingency fund. It started with $500k, but it has built itself up to the $1M. Mayor Brandvold then asked about amending the 2017 budget. Pat reviewed there was a way per the ARTDA, but that it those expenditures would get pushed out to MID would front the funds and the City would have even higher payments in Vice-Chairman Zoslocki asked Thomas Hedergard about allocating the funds for the manways to the reserve fund. Thomas responded that from the City s standpoint it will either be seen as a discount on the current year s operating budget as a net $2M savings and end up paying out what was proposed for the 2017 operating budget, or we would get the funds back and then Pat s group may come to the determination that these projects absolutely have to be done and would have to be funded. Either way, it s a policy decision from the City s standpoint. The Fiscal Year 2017 budget is fully funded based on the rate study. The City was not anticipating receiving the $2M in order to meet their debt coverage and bond commitments. Vice-Chairman Zoslocki asked if MID fronted the money would there be an added cost. Pat responded that there is a mechanism for MID to front those funds and they become part of the following year s budget. The downside is a $2M spike in the budget in one individual year and that could create more rate problems than if you utilize funds that have already been expended, so to speak, by the City. Thomas confirmed that was a true statement. He continued that they like to see payments remain as smooth as possible to project what

4 Tab No. 1 future debt service coverage would be. If there was a $2M spike in any given year it would start to affect debt service coverage as it would be an anomaly. Chairman Mensinger commented on the current situation with the State Water Resources Control Board (SWRCB) Bay-Delta Plan, and negotiations that could impact water allocation to the City and the membrane treatment plant. 6. Domestic Water Project Update (Pat Ryan) Pat reported that all is quiet at the plant. All customers had water for the Christmas and New Year s holidays. Production is way down from the summer at 15 MGD. It is fairly typical for this time of the year given the new water rationing program. He continued that the plant will begin regular winter maintenance and repairs in anticipation of higher deliveries in April. Staffing is on track; a new Senior Operator and two apprentice operators will be starting within the next month. A new Lab Technician will start on Monday. The plant will finally be fully staffed. Pat shared that unless there is an interim Policy Committee meeting, this would be his final meeting as he has submitted his retirement paperwork. Vice-Chairman Zoslocki stated that it was a pleasure to work with Pat and appreciated his long work on the up and down construction process and for his leadership. Chairman Mensinger added that he thanked him for his long service with MID. Chairman Mensinger added that there was one item not on the current agenda, which would be changing the management of the committee. He continued that has been the Chairman for a year now. Pat added that with his retirement, a new Secretary would also be needed. 7. Proposed Future Policy Committee Meetings April 6, 2017 at 8:30 a.m. at the Modesto Regional Water Treatment Plant July 6, 2017 at 8:30 a.m. in the MID Board Room 8. Adjournment The meeting was adjourned at 8:54 a.m.

5 TECHNICAL AND POLICY COMMITTEES AGENDA REPORT Meeting Date: April 6, 2017 Item No: 5 Subject: Recommended Action: Background and Discussion: Transfer of 2016 budget surplus to the Reserve and Contingency Fund for engineering and construction support services related to ongoing O&M at the Modesto Regional Water Treatment Plant and procuring the services of a safety consultant to prepare lock out tag out procedures, perform job hazard analyses and assess personal protective equipment. Concur to the transfer of 2016 budget surplus to the Reserve and Contingency Fund. Following substantial completion of the Modesto Regional Water Treatment Plant (MRWTP) Phase Two Expansion Project (Project), it was determined that several items need to be addressed to realize the full potential of the Project. As a result, the Water Treatment Plant Manager tasked Carollo Engineers (Carollo) with assembling a budget for optimization and design modifications of the Project. Carollo prepared a budget augmentation memo (please see attached), outlining the tasks proposed to be competed and budgetary numbers for each task. As set-forth in the attached memo, the total estimated cost of the Carollo work is $757,000. In addition, it was determined that additional safety related items needed to be completed for both the conventional plant and the Project (machine specific lock out procedures, job hazard analyses and proper personal protection equipment selection). This type of safety analysis is generally fairly specialized and in an effort to be both expedient and budget conscious, Modesto Irrigation District (MID) is recommending that an outside consultant be hired. MID has solicited bids from several different safety professional qualified to perform the necessary work and the lowest qualified respondent for the lock-out/tag-out work is Ideal Safety and Hygiene at an estimated cost of $80,000 (please see attached). It is estimated that the remaining work related to job hazard analysis and personal protection equipment selection will cost approximately $20,000. As discussed at the January 5, 2017 Policy Committee meeting, there is nearly $2,000,000 in unspent funds remaining in the 2016 budget, due to lower than anticipated water production, staff vacancies and deferred projects. At the December 21, 2016 Technical Committee meeting, the Technical Committee concurred to the transfer of remaining 2016 unspent monies to the reserve and contingency fund to be used to cover the cost of the proposed work with the expectation that said costs be tracked separately, reported monthly by the Water Treatment Plant Manager and that there should be no use of funds currently in the reserve and contingency fund. Alternatives, Pros and Cons of Each Alternative: Concurrence: Staff will be available to answer any questions that the Policy Committee may have. Pros: Avoids one-year budget spike to the City of Modesto and allows for timely completion of proposed projects Cons: Remaining monies aren t refunded to City of Modesto At the December 21, 2016 Technical Committee meeting, the Technical Committee

6 TECHNICAL AND POLICY COMMITTEES AGENDA REPORT Fiscal Impact: Recommendation: concurred to the transfer of remaining 2016 unspent monies to the reserve and contingency fund to be used to cover the cost of the proposed work with the expectation that said costs be tracked separately, reported monthly by the Water Treatment Plant Manager and that there should be no use of funds currently in the reserve and contingency fund. Typically unspent funds are refunded to the City after MID receives all invoices and trues up expenditures to payments by the City. In this instance the excess funds would not be refunded by the City, but also would not result in an impact to rates as these funds have already been accounted for by the City. Concur to the transfer of 2016 budget surplus to the Reserve and Contingency Fund. Attachments: Supporting documents attached: Presentation Other supporting docs None attached Carollo Budget Augmentation Worksheet Ideal Safety and Hygiene Proposal

7 0A0T Carollo Engineering and Construction Support for 2016 and 2017 Date 12/14/2016 Prepared By P. Ryan Task Priority 2016 Cost 2017 Cost Allocation Request Justification Work Order Packages for Membrane Plant 1 $52,000 $52,000 Various remaining design and operational enhancements identified as necessary to improve plant operations Assessment of several metering installation alternatives summarized in a tech memo including comparison of costs, operational efficiency, constructability etc. TRPS Metering Evaluation 2 $25,000 $25,000 TRPS Metering Contract Work Package Preparation 2 $30,000 Design package for recommended metering alternative include structural, mechanical, and EI&C drawings and specs and related coordination with equipment vendors $30,000 to support equipment procurement Record Drawing 2016 (See Note 3) 3a $0 $0 Record drawings to include original Phase 2 construction work and related re work to remedy Record Drawing 2017 (See Note 4) 3b $65,000 $65,000 design and construction deficiencies from Phase 2 Electronic O&M Manual 4 $365,000 Electronic O&M and standard procedures to be included as Operations Plan for DDW permit $365,000 compliance Support for DPH Permit Approval 5 $30,000 Technical assistance to finalize Operations Plan and $30,000 plant startup documentation required for DDW permit Ozone Tracer Testing 6 $25,000 Technical assistance to assist with test plan, testing and $25,000 data analysis required for DDW permit Pilot Testing 7 $40,000 Budget allowance to provide pilot testing IF NEEDED to optimize operation for low alkalinity, high TOC and $40,000 turbid water quality Field Support for Membrane Performance Testing 8 $35,000 Technical assistance to oversee membrane performance as required by Phase 2 Contract $35,000 Documents Field and Office Support for Upcoming Construction As Needed $55,000 $55,000 ESDC and CM for Misc Improvements Contract Package Budget allowance to provide team coordination, QM on Project Management and Team Coordination As Needed $35,000 $35,000 remaining deliverables, budget and schedule reporting 2016 Total $107, Total $650,000 Total Allocation Request for $757,000 Projected 2016 Budget Surplus $2,000,000 Amt. to Carry Over to Reserve and Contingency $2,000,000 Notes: 1. Items with a priority of "As Needed" are included in the 2017 total 2. Additional items related to Lock Out Tag Out procedures and Job Hazard Analysis are outside of this work, but will need to be considered in the carry over calculation. 3. Existing Record Drawings allocation budget expended through 12/31/16 is estimated to be approximately $105, Existing Record Drawing allocation remaining, to be spent in 2017 is $95,000

8 March 16, 2017 Mr. Jeff Fairbanks Safety Officer Modesto Irrigation District PO Box 4060 Modesto, California Re: Proposal for Lockout / Tagout Survey Ideal Safety & Hygiene, LLC Proposal # R1 Dear Mr. Fairbanks: Ideal Safety & Hygiene, LLC is pleased to submit this revised proposal to the Modesto Irrigation District to create approximately 370 Lockout / Tagout Energy Control Procedures for your Waterford, California Water Treatment Plant over eight (8), five (5)-day work weeks on-site. The eight (8) (5)-day weeks on-site will be scheduled during four (4) different site visits, each consisting of two (2) consecutive five-day work weeks. Scope of Work The Scope of Work for this proposal is to create approximately 370 LOTO Energy Control Procedures in a Microsoft Word format for your Waterford, California Water Treatment Plant. The LOTO Energy Control Procedures will be created over eight (8), five (5) day work weeks on-site. The eight (8) weeks on-site will be scheduled during four (4) different site visits, consisting of two (2) consecutive five (5)-day work weeks, utilizing at least two (2) Ideal Safety & Hygiene, LLC Safety Consultants. 818 Canyon Road Indianapolis, Indiana (Voice) (Fax) ideal.safety@yahoo.com 1

9 Creation of New LOTO Procedures LOTO procedures will be created for the various pieces of the Waterford, California Water Treatment Plant s Infrastructure-related equipment by using a LOTO template in a Microsoft Word format. Digital photos will be collected and pasted into each equipment-specific digital Microsoft Word procedure, to identify the various energy isolation points for each piece of new or revised equipment throughout the facility. Each newly-created LOTO procedure will be printed out, laminated and/or placed into a 3-ring binder, as requested. LOTO Procedure Review & Validation After each LOTO Energy Control Procedure is created by Ideal Safety & Hygiene, LLC, Facility Maintenance Authorized Employees employees from the Modesto Irrigation District Waterford, California facility will be requested to Review and Validate each newly-written LOTO procedure, in order to ensure that it is accurate and removes all stored and potential forms of energy from each machine and/or piece of infrastructurerelated equipment. Once each LOTO procedure is reviewed and validated by Modesto Irrigation District Authorized Employees, Ideal Safety & Hygiene, LLC will finalize and laminate each of the validated LOTO Procedures and place them into a 3-ring binder, organized by building / area on-site at the Waterford, California water treatment plant. Project Cost Based on the scope of work for the creation of up to 370 proposed Lockout / Tagout Energy Control Procedures, to be performed over eight (8), five (5)-day work weeks on-site, the overall price for this project is a lump sum cost of $80,000. This price includes all on-site labor, procedure writing and all travel-related expenses. Additional labor and expenses which are requested to be performed in addition to the proposed scope of work described in this proposal, will be billed in accordance with the Ideal Safety & Hygiene, LLC Consulting Fee Schedule as presented in Table 2 below, after receiving a Project Change Order or Purchase Order Adjustment from the Modesto Irrigation District Waterford, California facility: 2

10 Table 2 Ideal Safety & Hygiene, LLC Consulting Fee Schedule Labor / Expense Description Senior Industrial Hygienist (Labor) Senior Industrial Hygienist (Travel Time) Industrial Hygiene & Safety Consultant (Labor) Industrial Hygiene & Safety Consultant (Travel Time) Unit Cost $85 / hour $45 / hour $70 / hour $35 / hour Travel and Miscellaneous Expenses At Cost + 10% Additional Creation of LOTO Procedures $ / procedure Invoicing An invoice for 100% of each two week project total ($20,000), will be submitted after performing each field work visit over two consecutive weeks on-site. Payment of all invoices is due net 30 days. Sincerely, Ideal Safety & Hygiene, LLC Christopher A. Scheib, MS, ASP Senior Industrial Hygienist 3

11 To execute a contract with Ideal Safety & Hygiene, LLC for this proposal, Sign the acceptance line, Complete invoice information, FAX a copy of this Proposal Acceptance page to our office at: (888) Thank you Chris Scheib Acceptance Company > Modesto Irrigation District Waterford, CA Water Treatment Plant Proposal # R1 Total Proposal Cost: $ 80, billed as four (4) different, two (2) week site visits $ 20, per visit. Proposal accepted by > Printed Name Date Proposal accepted by > Authorized Signature Invoice Information Invoice to the attention of ( if applicable)> Invoice address ( check if same address as above) Street > City, State, ZIP > P.O. # ( > check if not required) 4

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