Public Utilities 2019/09/25CITY OF ANAHEIM
PUBLIC UTILITIES BOARD
MINUTES
SEPTEMBER 25, 2019
The agenda having been posted on Friday, September 20, 2019, the Regular Meeting of the Public
Utilities Board (Board) was called to order by Vice -Chairperson J. Seymour at 5:00 p.m. on Wednesday,
September 25, 2019, in the 11 rh Floor Large Conference Room, Anaheim West Tower, 201 S. Anaheim
Blvd., Anaheim, California.
Board Members Present: Vice -Chairperson J. Seymour, R. Bhalla, V. Baroldi, A. Abdulrahman
Board Members Absent: Chairperson E. Medrano, R. Gaona, J. Showalter
City Staff Present: D. Lee, B. Beelner, G. Bowen, M. Moore, J. Lonneker, J. Lehman,
D. Albaugh, D. Ballin, L. Quiambao, M. Seifen, B. Fruchter, V. Castillo,
H. Nielsen
Guest(s) Present: None.
AGENDA ITEM
1. PUBLIC COMMENTS.
2. APPROVAL OF THE MINUTES OF THE PUBLIC
UTILITIES BOARD REGULAR MEETING OF AUGUST 28,
2019. *
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ACTION TAKEN
There being no public
comments, Vice -
Chairperson J. Seymour
closed the public comments
portion of the meeting.
V. Baroldi moved approval
of the Minutes of the Public
Utilities Board Regular
Meeting of August 28, 2019.
R. Bhalla seconded the
motion.
MOTION CARRIED: 4-0.
ABSTAINED: 0.
ABSENT: 3 [E. Medrano,
R. Gaona, J. Showalter].
ITEM 4 04
3. RECOMMEND APPROVAL OF A PROFESSIONAL
SERVICE AGREEMENT WITH SDI PRESENCE LLC TO
PERFORM A WORK AND ASSET MANAGEMENT
SYSTEM NEEDS ASSESSMENT, ASSIST WITH A
SOLUTION PROCUREMENT, AND RELATED
IMPLEMENTATION SUPPORT SERVICES IN AN
AMOUNT NOT -TO -EXCEED $485,300 WITH A TEN
PERCENT (10%) CONTINGENCY FOR A THREE YEAR
TERM AND AN OPTIONAL TWO YEAR EXTENSION. *
G. Bowen, Assistant General Manager — Power Supply, provided
the Board with a brief explanation of Anaheim Public Utilities
(APU) Department's existing Work and Asset Management
System status and request to approve a professional service
agreement with SDI Presence LLC for a needs assessment,
solution procurement, and implementation support. He then
introduced B. Fruchter, Enterprise Information Technology
Manager, to present an overview of the work order and asset
management system project and requested consulting services.
B. Fruchter provided background on what a work and asset
management system is, and he explained that APU's current work
and asset management system is 15 years old, near its end of life,
and has limited capabilities compared to solutions in the
marketplace today. B. Fruchter shared that APU is undertaking a
project to replace this system with the aim to improve customer
service levels and lower the overall cost of owning and operating
assets.
B. Fruchter shared that a Request for Proposal (RFP) was issued to
seek consulting services for a needs assessment, solution
procurement, and implementation support. The process followed
Council Policy 4.1 and the recommendation is to enter into an
agreement with SDI Presence LLC to provide these services based
on their considerable experience providing Information
Technology (IT) and asset management consulting to
municipalities and utilities. B. Fruchter provided an overview of
the scope of services, project timeline, and costs.
The Board asked if the solution will be an off-the-shelf purchase
and if the consultant will look at various vendors and their
capabilities. B. Fruchter responded that APU plans to go with a
commercial -off-the-shelf solution instead of a custom-built one.
APU will issue an RFP with its requirements based on the needs
assessment. The consultant will help evaluate vendor solutions
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A. Abdulrahman moved
approval for a professional
service agreement with SDI
Presence LLC for a Work
and Asset Management
Needs Assessment, Solution
Procurement, and
Implementation Support
Services. R. Bhalla
seconded the motion.
MOTION CARRIED: 4-0.
ABSTAINED: 0.
ABSENT: 3 [E. Medrano,
R. Gaona, J. Showalter].
that meet APU requirements and a recommendation will be
brought forward to the Board and Council at a later date.
The Board asked if SDI will be allowed to propose a solution. B.
Fruchter responded that they will not and that there is a provision
in the consulting agreement that precludes SDI from bidding on the
solution to avoid a conflict of interest.
The Board asked if the costs were $485k plus 10% contingency per
year. B. Fruchter responded that $485k is for the term of the
agreement, not each year. D. Lee pointed out the cost breakdown
of each phase in Exhibit B of the agreement.
The Board asked if Oracle offers a solution that replaces the
current solution. B. Fruchter and G. Graham responded that
Oracle does offer version 2 of their solution, but it is a re -write and
essentially like a new product that would require a considerable
migration effort. APU will review all options for the best fit.
The Board asked if the estimated $3 million cost of the solution
was for time and material. D. Lee and B. Fruchter responded that
this was estimated to be the solution cost with implementation.
The Board asked if SDI has worked in this field. B. Fruchter
responded that SDI has experience doing IT and asset management
consulting with 120 municipalities and utilities. He shared about
one of the references staff contacted, City of Pasadena, who SDI
developed an asset management strategic plan for. Pasadena had
very positive feedback regarding SDI's services.
4. RECOMMEND APPROVAL OF THE WATER
ENGINEERING GENERAL SERVICES AGREEMENTS
FOR PROFESSIONAL ENGINEERING AND CONSULTING
SERVICES WITH THE FOLLOWING PREQUALIFIED
CONSULTANTS FOR A THREE-YEAR TERM WITH UP TO
TWO ONE-YEAR EXTENSIONS: AECOM TECHNICAL
SERVICES, INC.; AESCO, INC.; AKM CONSULTING
ENGINEERS, INC.; CANNON CORPORATION; DRP
ENGINEERING, INC.; DUDEK; GEOPENTECH, INC.; GHD,
INC.; HUSHMAND ASSOCIATES, INC.;
INFRASTRUCTURE ENGINEERING CORPORATION;
KENNEDY/JENKS CONSULTANTS, INC.; LEE & RO, INC.;
LEIGHTON CONSULTING, INC.; MICHAEL BAKER
INTERNATIONAL, INC.; NEXT LEVEL SCADA (USA),
INC.; NV5, INC.; PSOMAS; SA ASSOCIATES; TECHNICAL
SYSTEMS, INC.; TETRA TECH, INC.; AND SUCH OTHER
ENGINEERING CONSULTANTS AS MAY BE
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V. Baroldi moved approval
of a general services
agreement for Professional
Engineering and Consulting
Services for a Three -Year
Period. R. Bhalla seconded
the motion.
MOTION CARRIED: 4-0.
ABSTAINED: 0.
ABSENT: 3 [E. Medrano,
R. Gaona, J. Showalter].
PREQUALIFIED IN A NOT TO EXCEED AMOUNT OF
$400,000 PER WORK ORDER PACKAGE WITH A 15%
CONTINGENCY. *
M. Moore, Assistant General Manager — Water Services, indicated
the Agreement is for on call professional consulting services. M.
Moore noted that this Agreement allows APU to quickly issue small
project awards to consultants that are licensed and experienced in
providing utility water engineering services.
M. Moore explained that the agreement sets the terms and
conditions for the on call services but it does not pre -award any
work to any consultant. Ile stated that any work under the
Agreement will be awarded pursuant to City Council Policy 4.1
which sets the requirements for the selection of consultants.
5. RECOMMEND APPROVAL OF A RESOLUTION
A. Abdulrahman moved
AUTHORIZING THE PUBLIC UTILITIES GENERAL
approval of a resolution to
MANAGER OR DESIGNEE TO SUBMIT AN APPLICATION
submit an application to the
TO THE CALIFORNIA STATE WATER RESOURCES
California Board for a Water
CONTROL BOARD FOR A WATER RECYCLING
Recycling Facilities
FACILITIES PLANNING GRANT (GRANT) OF UP TO
Planning Grant and accept
$150,000 TO FUND A FACILITY RETROFIT STUDY, AND,
such grant, if awarded. R.
IF AWARDED, TO (A) ACCEPT THE GRANT; (B)
Bhalla seconded the motion.
PROVIDE THE ASSURANCES, CERTIFICATIONS AND
MOTION CARRIED: 4-0.
COMMITMENTS REQUIRED FOR THE GRANT
ABSTAINED: 0.
APPLICATION, INCLUDING EXECUTING AND
ABSENT: 3 [E. Medrano,
CARRYING OUT A FINANCIAL ASSISTANCE
R. Gaona, J. Showalter].
AGREEMENT AND ANY AMENDMENTS THERETO; AND
(C) AMEND THE CITY'S ANNUAL BUDGET IN THE
APPLICABLE FISCAL YEAR ACCORDINGLY. *
M. Moore indicated APU is pursuing a construction project to
expand Anaheim's recycled water. M. Moore noted that APU is
qualified for a grant provided by the California State Water
Resources Control Board. If awarded, he explained the grant would
help fund a facilities retrofit study for recycled water uses in
Anaheim that would help customers transition to recycled water for
non -potable uses.
6. RECOMMEND APPROVAL OF RESOLUTIONS TO
V. Baroldi moved approval
DECLARE THE OFFICIAL INTENT TO ALLOW THE
of a resolution to allow the
ELECTRIC UTILITY FUND AND WATER UTILITY FUND
Electric Utility fund and
TO INCUR DEBT; AND AFFIRM THAT THE ELECTRIC
Water Utility Fund to incur
UTILITY FUND AND WATER UTILITY FUND MAY BE
debt and affirm that the
funds may be reimbursed for
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REIMBURSED FOR CERTAIN EXPENDITURES FROM
PROCEEDS OF THAT DEBT, IF ISSUED. *
B. Beelner, Assistant General Manager - Finance and
Administration, described the proposed resolution seeking the
approval for APU to reimburse itself for certain capital
expenditures from future bond issuances. B. Beelner mentioned
that this resolution would not grant authority for APU to incur
debt, but solely the authority to reimburse itself for current capital
expenditures from future bond issuances if those bonds were
indeed issued. B. Beelner then mentioned that APU plans to seek
the recommendation for approval for the issuance of both water
and electric revenue bonds from the Board in December 2019 in
order to partially fund its ongoing capital improvement plan.
7. DEPARTMENT ORDER 310 (EXTRA WORK/CHANGE
ORDERS) ANNUAL REPORT.
The Department Order (DO) 310 report provides an annual review
of change orders for construction contracts, consulting agreements,
and for small-scale projects through prequalified firms. During the
Fiscal Year, 50 design and construction projects were completed by
APU (27 Electric, 23 Water), where outside consultants and
contractors provided services. The net variance for all project
expenditures was 3.3% below the contract award amount.
There were two projects that required City Council authorization for
change orders: 1) Katella water main replacement required two
change orders to address higher excavation and paving
requirements, and to coordinate with an electric project by
consolidating street repairs, and 2) Lincoln/Rio Vista
Undergrounding required extensive iterations of design and related
permit application documents for Caltrans to allow construction near
the 57 freeway.
8. DISCUSSION ON PUBLIC UTILITIES STRATEGIC
PLANNING PROCESS.
D. Lee provided an overview of the strategic priorities process
initiated by the City Manager's Office. A review of
accomplishments during the prior year, a Strengths, Weaknesses,
Opportunities and Threats (SWOT) assessment, and identification of
strategic priorities for APU were presented to the Board, who
provided comments and feedback on the SWOT.
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certain expenditures. R.
Bhalla seconded the motion.
MOTION CARRIED: 4-0.
ABSTAINED: 0.
ABSENT: 3 [E. Medrano,
R. Gaona, J. Showalter].
Comments by the Board included:
• The importance of staying ahead of maintenance needs to
avoid major infrastructure problems experienced by other
utilities;
• Changing the issue of attracting and retaining staff from a
weakness to a threat;
• Continuing to move towards more cash funding for capital
and not relying solely on debt;
• Improving the debt to asset ratio as an opportunity for
greater financial strength; and,
• Compliance with environmental regulations as a strength of
the agency.
The Board's comments will be incorporated into a document for
further discussion with the City Manager's Office as part of the
citywide strategic priorities process.
9. UPDATE ON ELECTRIC SYSTEM ISSUES.
J. Lonneker, Assistant General Manager — Electric Services,
informed the Board of the upcoming Public Power Week event to
be held on October 10, 2019 at Center Street Promenade and
Lemon St. J. Lonneker indicated that APU is hosting 150, 4th and
6th grade students from Roosevelt and Maxwell elementary schools
who will learn how electricity comes to their house, and about
safety around power lines and will participate in a scavenger
hunt. Then, the public is invited to join in between 12 noon and 3
p.m. where APU will have information booths and displays to
learn about the many rebates and programs offered.
J. Lonneker updated the Board on the APU hosted wildfire camera
training provided for APU Electric and Water Operations and
Anaheim Fire and Rescue staff and MetroNet dispatchers who are
authorized to control these cameras. UC San Diego personnel and
the Southern California Edison (SCE) Fire Management Officer
provided the training. A demonstration of the cameras will be
presented at a future Board meeting.
10. UPDATE ON WATER SYSTEM ISSUES.
M. Moore reviewed the water supply dashboard with the Board.
He indicated that the new water year will start in October and that
water storage levels are near normal levels.
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A demonstration of the
wildfire cameras will be
presented at a future
meeting.
M. Moore made the Board aware of the upcoming Metropolitan
Water District of Southern California inspection trip of the State
Water Project, which is scheduled for October 25-26, and that
interested Board members should contact P. Oviedo.
Lastly, M. Moore shared with the Board that water maintenance
staff competed in the Orange County Water Association pipe
tapping contest and shared a video of the pipe tapping team. He
noted that APU's team consisted of Gildardo Sanchez, Gilbert
Verduzco, Ernest Escobedo and Jeff Martinez. The team
completed the pipe tap in less than two minutes.
11. UPDATE ON FINANCE ISSUES.
B. Beelner discussed the monthly dashboard with the Board. He
said the year to date electric revenue through August 31, 2019 was
9.3% below budget ($7.9M) due primarily to a temperate summer
causing low retail demand coupled with lower than expected
wholesale revenue driven by lower than expected wholesale prices.
Costs for the fiscal year fell below budget by 4.8 % ($3.3 M) also
due to lower than expected demand, lower than expected wholesale
power prices causing a negative net budget variance of $4.6M.
B. Beelner then mentioned that year to date water revenue was
6.0% ($1.OM) below budget due to weaker than anticipated
customer demand as a result of the temperate summer; he also said
costs were below budget as well by 5.7% (0.8M) causing a positive
net $0.2M budget variance.
B. Beelner then discussed the sluggish economy and the continued
concern of an economic downturn in 2020. B. Beelner and the
Board discussed potential impacts in the event of a recession, and
how APU has handled such economic slowdowns in the past.
12. UPDATE ON POWER SUPPLY ISSUES.
G. Bowen provided an update on APU's power supply portfolio
noting that wholesale energy prices continue to be lower than
anticipated due to the lower temperatures throughout the State.
The lower temperatures have also resulted in lower wholesale sales
and lower electrical loads in Anaheim.
G. Bowen also informed the Board that an assessment to determine
options for future operations of the Kraemer Power Plant is
ongoing and nearing completion and that staff will provide a
recommendation on options at the upcoming November meeting.
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Lastly, G. Bowen showed the Board pictures of new lighting
installed at the Veteran of Foreign Wars facility carpark area on
805 E. Sycamore Street to help provide increased lighting in the
area. G. Bowen also indicated that over 30 lights were installed
inside the facility as well through APU's Small Business Direct
Install Program at no cost.
13. UPDATE ON ENTERPRISE RISK AND COMPLIANCE.
J. Lehman, Chief Risk Officer, provided several updates to the
Board. The first was on the Wholesale Energy Risk Management
(ERM) Program's Quarterly Compliance report. She indicated that
despite credit downgrades of the investor-owned utilities related to
potential wildfire liabilities, APU's portfolio was strong. There
were no violations of the ERM during this period, and all
transactions were within the Authorized Transaction Limits.
She then shared that the PUB Legislative Working Group met prior
to the Board meeting to review the first year of this two-year
legislative session, which ends on October 13, the last day the
Governor has to either approve or veto a bill. J. Lehman reported
that this has been a generally positive legislative year, in which
many of the more concerning bills either did not proceed or
became 2 -year bills, and a solution was finally passed in place of a
water tax to assist those water systems that are struggling to
provide clean water to their customers. She reported that in the
regulatory area, every six years APU's compliance with the North
American Reliability Corporation (NERC) reliability standards is
required to be audited and that the audit is comprehensive and
includes operational procedures and maintenance records. The last
audit was conducted in 2016. In October, the audit schedule will
be released for 2020.
Lastly, she shared that Environmental Services staff participates in
public outreach events, and in June, staff attended the Walnut
Canyon open house and fielded a number of questions, including
those regarding a more natural way to deal with rodents. APU
staff sent owl box blueprints to those who requested them, and then
this month received photos from a gentlemen who built and
installed an owl box in his backyard, the photo was shared with the
Board.
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14. ITEM(S) BY SECRETARY.
D. Lee shared with the Board the items scheduled for the following
Board meeting include:
Water reliability presentation
Emergency response plan
Sustainability education center design services
D. Lee discussed a tour of the water recycling plant that was given
to the state delegation of the Chief Minister of Tamil Nadu, India.
Due to the lack of water experienced in Tamil Nadu, the group was
very interested in how Orange County and Anaheim utilizes
recycled water. Future collaboration is anticipated for knowledge
sharing and additional tours.
Lastly, D. Lee discussed that the Boards and Commissions
attendance policy was introduced by the City Clerk based on
feedback from City Council. D. Lee informed the Board that the
City Clerk will be providing additional details based on the
approval of an ordinance.
15. ITEMS) BY BOARD MEMBERS.
R. Bhalla thanked staff for giving a tour to the Chief Minister of
Tamil Nadu, India.
J. Seymour inquired about the canisters that are on top of light poles
A presentation on wireless
in Anaheim. Staff indicated that wireless providers are starting to
antennas will be scheduled
attach wireless antennas to street lights in preparation for 5G
for a future meeting date.
deployment as previously presented to the Board.
16. ADJOURNMENT: (NEXT REGULAR MEETING ON
A. Abdulrahman moved to
OCTOBER 23, 2019, AT 5:00 P.M., IN THE 11TH FLOOR
adjourn the Regular Meeting
LARGE CONFERENCE ROOM, ANAHEIM WEST TOWER,
at 7:00 p.m., to the Board's
201 S. ANAHEIM BOULEVARD, ANAHEIM, CALIFORNIA).
Regular Meeting date of
October 23, 2019 at 5:00
p.m. R. Bhalla seconded the
motion.
MOTION CARRIED: 4-0.
ABSTAINED: 0.
ABSENT: 3 [E. Medrano,
R. Gaona, J. Showalter].
2019-77
Res ectfu y su miffed,
G
Dukku Lee
Public Utilities General Manager
* Indicates item(s) that will be forwarded to City Council for action upon recommendation by the
Board.
* * Indicates item(s) that will be forwarded to City Clerk and City Council for informational purposes.
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