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HomeMy WebLinkAbout03-09-18 Agenda Packet Metropolitan Wastewater MANAGEMENT COMMISSION AMSPRINGFIELD 1I �OIIEGON partners in wastewater management MWMC MEETING AGENDA Friday, March 9, 2018 @ 7:30 a.m. Water Pollution Control Facility 410 River Avenue, Eugene, OR Willamette Meeting Room Turn off cell phones before the meeting begins. 7-30 - 7-35 I. ROLL CALL 7-35 - 7-40 II. ELECTION OF OFFICERS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Matt Stouder Action Requested: To nominate and elect from among its members a Commission President and Vice-President to serve through March 2019 7:40 — 7:45 III. CONSENT CALENDAR a. MWMC 2/9/18 Meeting Minutes Action Requested: By motion, approve the Consent Calendar 7:45 — 7:50 IV. PUBLIC COMMENT Request to speak slips are available at the sign-in desk and need to be turned in to the MWMC Secretary before the meeting starts. 7:50 — 8:05 V. RESILIENCY PLANNING (P80096) CONSULTANT SELECTION. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Josh Newman Action Requested: By motion, approve Resolution 18-03. 8:05 — 8:45 VI. PRELIMINARY FY 2018-19 REGIONAL WASTEWATER PROGRAM (RWP) BUDGET. . . . . . . . . . . . . . . . .Matt Stouder/ Dave Breitenstein/ Katherine Bishop Action Requested: Provide comments and direction to staff 8:35 — 8:55 VII. MOBILE WASTE HAULER FEES/RATES . . . . . . . . . . . . . . . . Dave Breitenstein Action Requested: Provide direction regarding Mobile Waste Hauler Rates 8:55 — 9:15 VIII. BUSINESS FROM COMMISSION, GENERAL MANAGER, AND WASTEWATER DIRECTOR THE FULL PACKET IS POSTED ON THE WEBSITE www.mwmcpartners.orp 9:15 IX. ADJOURNMENT The meeting location is wheelchair-accessible. For the hearing-impaired, an interpreter can be provided with 48-hours-notice prior to the meeting. To arrange for service, call 541-726-3694. All proceedings before the MWMC are recorded. THE FULL PACKET IS POSTED ON THE WEBSITE www.mwmcpartners.orp AGENDA ITEM II Metropolitan Wastewater Management Commission SPRINGFIELD r OREGO partners in wastewater management MEMORANDUM DATE: March 2, 2018 TO: Metropolitan Wastewater Management Commission (MWMC) FROM: Matt Stouder, MWMC General Manager SUBJECT: Election of Officers ACTION Nominate and elect from among its members a Commission REQUESTED: President and Vice President to serve through March, 2018 ISSUE The Commission elects new officers in March of every year for one-year terms. The Commission needs to determine officer positions for the term of March 2018 through March 2019. DISCUSSION Traditionally, the Commission has employed a practice of rotating the officer positions among the three jurisdictions on an annual basis, and rotates the Commissioner serving as Vice President to President. However, there are no formalized guidelines in the MWMC Bylaws regarding the rotation of officers among the jurisdictions, or any restrictions on the number of consecutive years a Commissioner serves in a particular office. President Bill Inge is a Lane County citizen representative, and vice president Peter Ruffier is a Eugene citizen representative. If the Commission chooses to follow its traditional practice, Commissioner Ruff ier would become President, and the new Vice-President would be a representative from the City of Springfield. REQUESTED ACTION The Commission is requested to nominate and elect from among its members a Commission President and Vice President to serve through March, 2019. AGENDA ITEM III Metropolitan Wastewater Management Commission SPRINGFIELD OeEG�N partners in wastewater management MWMC MEETING MINUTES Friday, February 9, 2018 @ 7:30 a.m. City of Springfield City Hall, Library Meeting Room 225 Fifth St., Springfield, OR 97477 President Inge opened the meeting at 7:30 a.m. Roll call was taken by Kevin Kraaz. ROLL CALL Commissioners Present: Pat Farr, Bill Inge, Doug Keeler, Walt Meyer, Joe Pishioneri, Peter Ruff ier Absent: Jennifer Yeh Staff introductions were made: Meg Allocco, Todd Anderson, Jolynn Barker, Katherine Bishop, Tom Boyatt, Dave Breitenstein, Judy Castleman, Marc Furney, John Huberd, K.C. Huffman (attorney), Laura Keir, Tonja Kling, Kevin Kraaz, Shawn Krueger, Emily Lane, Troy McAllister, Todd Miller, Michelle Miranda, Josh Newman, Sharon Olson, Loralyn Spiro, Matt Stouder, and Greg Watkins Guests: Gary Williams, Lane County Commissioner Jean-Luc Hebert — U of O law student CONSENT CALENDAR a. MWMC 1/12/18 Meeting Minutes MOTION: IT WAS MOVED BY COMMISSIONER KEELER WITH A SECOND BY COMMISSIONER PISHIONERI TO APPROVE THE MINUTES. THE MOTION PASSED UNANIMOUSLY 6/0. Matt Stouder, MWMC General Manager, introduced Garry Williams, Lane County Commissioner for District 5, East Lane, and alternate for MWMC. PUBLIC COMMENT There was no public comment. AWARD OF CONTRACT FOR POPLAR PRUNING AND CUTTING COLLECTION SERVICES Todd Miller, Environmental Management Analyst, stated he was requesting authorization of Resolution 18-01 to execute a contract with GreenWood Resources, Inc. for poplar pruning and cutting collection services. The need for this contract is that Management Unit (MU) 2 was harvested and is ready to be replanted and MU1's trees need pruning and cuttings taken for MU2. MWMC Meeting Minutes February 9, 2018 Page 2 of 14 The cuttings can be secured from a nursery and taken from MWMC's trees. An invitation to bid went out and GreenWood Resources was the lowest responsive bid. DISCUSSION: Commissioner Pishioneri asked if staff has considered asking a local high school to participate where they can learn to do the cuttings for extra credit. Mr. Miller said he had reached out to NW Youth Corp which operates a service learning high school as well as places crews to do this type of work. They are going to have a crew do either the cutting collection or pruning and Mr. Miller negotiated with GreenWood Resources to provide the supervisory oversight to make sure they are doing it correctly. If that goes well, staff can work with NW Youth Corp in future iterations of this type of work. Commissioner Ruff ier said he noticed the proposal includes both planting of sole source and nursery source cuttings. He asked how the diversification of the hybrids is going. Mr. Miller clarified that this contract is for collection of the cuttings of one particular variety that is being grown on MU1 currently; the OP367 variety. It has been around a long time for pulp production and has proven very resistant, large growing, and is received well by the pulp and wood products industries. It was planted mainly in MU1 and ironically, the OP367 was the variety that took the brunt of the force from the ice storm in MU2. Mr. Miller said he believes it is because they were the more robust trees and the ice weighed heavily on their branches and ended up breaking them in half. Going forward, one third of MU2 will be planted with two new varieties that are coming from GreenWood Resources and the other two-thirds will be OP367. GreenWood's bid was so competitive that there was really no cost savings to us to do our own cuttings versus buying them from their nursery. So, for further diversification, we will do a 50/50 split to compare using our own cuttings versus the nursery's cuttings to see if there is any difference in the performance. Commissioner Ruffier asked if the evaluation of the different hybrids was subjective or objective. Mr. Miller replied, very subjective. Commissioner Meyer stated that MWMC manages the Poplar Farm as an agricultural product rather than a forestry product. If we ignored that for the moment, what would be the cycle of a tree in order for the tree to reach its most productive in terms of biomass? Mr. Miller responded when they reach16-18 years they are maxing out. The advice he has received is 12 years is adequate growth for the mill. MOTION: IT WAS MOVED BY COMMISSIONER RUFFIER WITH A SECOND BY COMMISSIONER PISHIONERI TO APPROVE RESOLUTION 18-01. THE MOTION PASSED UNANIMOUSLY 6/0. SOFTWARE FOR CAPITAL PROGRAM — AUTODESK (CONSTRUCTWARE) Troy McAllister, Managing Civil Engineer, requested approval of Resolution 18-02, to establish a brand name specification related to Constructware and provide authority to negotiate a software agreement for up to an additional three years. The MWMC is nearing the end of a three-year software agreement with DLT Solutions, LLC for Constructware (Autodesk product) that is used to support the Capital Improvement Program. The Constructware software has been customized with staff input to accommodate processes and standards that relate to project implementation and controls used for communication and collaboration. It has benefited the MWMC capital program with several elements, such as: MWMC Meeting Minutes February 9, 2018 Page 3 of 14 standardizing work flow processes, internal/external communication controls, tracking/archiving work product deliverables, project reporting and other benefits to project staff. In the budget, the five-year plan shows the intent to implement projects costing approximately $80 million. Constructware supports the successful delivery of these projects. Staff will be seeking at least three bids from resellers of Constructware for a three year contract. Mr. Stouder added that staff and the MWMC's contractors have familiarity with the software and have used it successfully. DISCUSSION: Commissioner Pishioneri asked if staff is happy with the software, does it work well for MWMC, and the license length. Mr. McAllister replied that it works fine and he does look around to see if there is a better product out there, but they all have their issues. Commissioner Pishioneri said he is comfortable with that as long as staff keeps a lookout for products that may be better for the organization. He wouldn't necessarily suggest changing it but hopes that staff will continue to look at software. Commissioner Ruffier said 12 years is a pretty good run for software. Does staff have much need for interface with the contractors with this software? Mr. McAllister replied that both the consultants and the contractors are required to use it. They submit their pay applications, communications, and all the deliverables into the software as well as submittal tracking for construction, request for information tracking; it is a way to have all the elements in one place. Commissioner Ruff ier asked if Mr. McAllister foresees any problems, considering Constructware is coming to the end of its life. Mr. McAllister replied that it is his understanding that Autodesk is going to merge Constructware into another more comprehensive product. It will be one of the solutions in their portfolio that will be offered. Mr. McAllister said that he is always looking at other software and talking with other agencies to get the best information. Commissioner Meyer asked if the information is stored on their servers, the web, or ours. Mr. McAllister stated it is on the cloud and it is a very well backed up system. We get a snapshot after the job is finished and we tie that into our system. Commissioner Keeler asked if the reason for the resolution is to introduce some competition into this purchase that we are going to make and possibly get a better arrangement. Mr. McAllister replied it is; he is hoping to get three quotes from resellers. He is finding that since we are a public sector there is only one reseller that gives the best discount. He is going to try his best to negotiate a good price. Commissioner Keeler replied he appreciates Mr. McAllister's effort. MOTION: IT WAS MOVED BY COMMISSIONER KEELER WITH A SECOND BY COMMISSIONER PISIONERI TO APPROVE RESOLUTION 18-02. THE MOTION PASSED UNANIMOUSLY 6/0. DRAFT FY 2018-19 REGIONAL WASTEWATER PROGRAM (RWP) CAPITAL BUDGET AND 5-YEAR CAPITAL PLAN Mr. McAllister, Josh Newman, Managing Civil Engineer, and Greg Watkins, AIC WPCF Operations Manager made the presentation. Projects to be carried over to FY 2018-19: Increase Digestion Capacity, Operations and Maintenance Building Improvements, Decommission WPCF Lagoon, Electrical Distribution MWMC Meeting Minutes February 9, 2018 Page 4 of 14 System Replacement and Upgrades, RNG Upgrade Facilities, Resiliency Planning, Thermal Load mitigation: Pre-Implementation, Poplar Harvest Management Services, Facilities Plan Engineering Services, and Thermal Load Mitigation: Implementation 1. Mr. Newman noted that one of the on-going projects, Poplar Harvest Management Services, has a pilot project where some saw logs were taken to Urban Lumber and milled into planks. The planks were seasoned, cured and sent to 9Wood, a Springfield company that makes architectural panels. The panels are planned to be featured in Springfield's City Hall. New projects for FY 2018-19 are the Recycled Water Demonstration Project, Class A Disinfection Facilities, Riparian Shade Credit Program, and the Comprehensive Facility Plan Update. The Comprehensive Facility Plan Update is dependent upon the new permit which continues to be pushed out. The plant needs to be prepared for upcoming CIP projects in regards to stormwater. The projects include impervious surfaces which require staff to go through negotiations with the City of Eugene in terms of MWMC's building permit process. If that is done every time we have a new project, it is tedious and takes up a lot of staff time. Staff plans on taking a small portion of the Comprehensive Facility Plan Update funding to move forward with stormwater planning for the plant that will give staff a way to implement projects on site without all the tedium they currently have to go through with all the permits. Commissioner Meyer asked if the MWMC has a stormwater permit with the City of Eugene for the plant site. Dave Breitenstein, AIC Wastewater Director, answered yes, it is a 1200Z permit. Commissioner Meyer asked if we are still discharging with that permit. Mr. Breitenstein replied we are authorized to discharge but currently we are using an approach that does not discharge into the river, it infiltrates on site. Mr. Newman stated the total Capital Improvement Program Budget for FY 2018-19 is $30,826,000. Asset Management Program is made up of Equipment Replacement, Major Rehabilitation, and Major Capital Outlay. The Equipment Replacement Program is defined as any asset that is between $10,000 and $200,000 in replacement costs and has an expected life less than 20 years. The total proposed budget for Equipment Replacement is $649,000. Major Rehabilitation is for items that are either greater than $200,000 replacement cost or have a longer life than 20 years and items that staff chooses to rehabilitate rather than replace. Total budget for Major Rehabilitation is $1,175,000. Mr. Watkins stated the plant's control system is Yokogawa Distributed Control System (DCS). Staff plans to make security improvements both from hardware and a software standpoint to improve resiliency and to protect from potential outside security threats. Also planned for the system is to go to a tablet based wireless system so operators can turn equipment on and off, make adjustments, note conditions without having to be at specific control stations throughout the plant. President Inge asked if the $10,000 allotted for the Springfield Pump Station's roof would pay for an entire roof. Todd Anderson, AIC Maintenance Manager, replied that it was for the entire roof, it is a very small roof. MWMC Meeting Minutes February 9, 2018 Page 5 of 14 Commissioner Pishioneri asked if membrane material would be used again on the roof and what kind of slope does it have. Mr. Anderson replied that it is flat and would be using membrane again. Commissioner Pishioneri asked if staff had looked into having the roof slope up and putting a metal roof on it. Mr. Anderson replied no. Commissioner Pishioneri said it might be worth looking into because metal roofs last a lot longer and it might be worth the effort to get a bid on that. Major Capital Outlay for FY 2018-19 is $200,000 and is for Laboratory Information Management System software for the plant and the Water Quality Lab. The Regional Wastewater 5-year Capital Programs total is $93,234,000 - shown in Figure 13 in the memo. DISCUSSION: President Inge asked if it was realistic to have no major capital outlays from FY 2019-20 to FY 2022-23. Mr. Watkins said staff is not aware of any right now. President Inge asked if staff had checked back to see if there was ever a time when we didn't have capital outlays for four years. Mr. Watkins replied they had not. President Inge said it would be worth doing. Mr. Breitenstein said it is hard to identify prospective major capital outlays five years out that wasn't already a part of a capital improvement program. President Inge said that he would rather have it added with an asterisk than come back later and say oh, we didn't see that. Commissioner Meyer noted that the Equipment Replacement costs jump dramatically in FY 2021- 22 and asked if staff had something specific that they were thinking of that would cause that. Mr. Watkins replied yes, it is basically reflective of the age of original plant construction. Through good preventative maintenance, staff has extended that life but now it is reaching the end of its life. Commissioner Ruffier asked in regards to Plant Performance Improvements for FY 2022-23, if there was something specific in mind for the $20,014,000. Mr. McAllister referred back to Exhibit 13 (page 8 of Attachment 1 on Agenda Item VI) which shows the projects predicted amounts like $4 million for Aeration Basin Improvements Phase 2 and $14 million for Tertiary Filtration Phase 2. Commissioner Ruffier asked if there were any speculation on new permit requirements in that amount. Mr. Stouder responded that it is hard to project out five years when we do not have a new permit; there is no certainty and yet we know that the permit will land somewhere within that 5-10 year time frame. We take a fresh look every year at the best information that we have. For example, Tertiary Filtration has been pushed out for the five years that he has been here. Mr. Newman stated that in 2014, staff had the consultant run a process model, which was more objective, and the Aeration Basin and the Tertiary Filtration projects were deemed unnecessary for some time. The problem becomes when trying to anticipate what changes might come to a permit that is continually moved out. The projects become more like placeholder projects. The question is, do you want to move them all the way or incrementally to show what might happen if we have a permit change. So it is a balance. Commissioner Meyer said that he is glad that staff is doing rehab of existing tanks, drives, and so forth because that is an investment into MWMC's future. He appreciates the fact that staff is being proactive; it is difficult to do but needs to be done. Commissioner Ruffier noted that under Regional Wastewater Objectives (page 1 of Attachment 1 on Agenda Item VI) is "Implementation of the Citizens Advisory Committee (CAC) recommendations"; it has been a long time since we had a CAC. Are there any thoughts about redoing that? Mr. Stouder replied that it is something staff would consider when we start MWMC Meeting Minutes February 9, 2018 Page 6 of 14 negotiating a new permit and if restrictions are placed upon us that would cause major impacts upon the community. We had one when we were developing the Biosolids Facility and wanted to get feedback from the community. Commissioner Ruffier stated that he didn't want to add a lot to staff work load but could the recommendations from the CAC be summarized and state where we are with them? K.C. Huffman, MWMC legal counsel, asked if there would be a need for a CAC for the Private Lateral program. Mr. Stouder said that would be more on the local side because the implementation would be through the local communities. Commissioner Ruffier noted that there was $4M that was obtained through the American Reinvestment Recovery Act and asked if the funding had been expended. Mr. McAllister replied it was used for a cover for the two primary clarifiers for the Odor Project. Commissioner Ruffier asked, in regard to the Class A Recycled Water projects, what volume of water will be targeted to treat. Mr. Newman replied that it would be a minor amount for the demonstration projects such as the street tree watering. Mr. Stouder added that the idea is more along the line for public acceptance so that as MWMC develops its portfolio in the future, depending on where we go with permit requirements, if we do need to expand on recycled water we will have the public's trust. Commissioner Ruffier referred to the generator listed in equipment replacement, stating they don't get a lot of use and is curious why it needed to be replaced. Mr. Watkins said that they are used for planned power outages throughout the plant for process units and maintenance of electrical equipment, etc. Mr. Anderson added it is 19 years old and extremely loud. They are planning to replace it with a quieter, neighbor friendly generator. Commissioner Ruffier commented on the amount of money being spent on the software. There is $463,000 for the Yokogawa Distributive Control System (DCS), $200,000 for Laboratory Information Management System (LIMS), and whatever it comes out to for the Constructware. It seems like a lot of money is being spent in that area. President Inge said that the 2004 Facilities Plan was intended to go through 2025. He asked what staff's assessment is now that we are two-thirds the way through the process; are we on target, are we ahead? Matt Stouder replied staff prepared a partial facilities plan update in 2014 in which they looked at population growth projections, whether we are on track with the projects and where we are going. He said we have bridged the gap somewhat. Staff will look at that again in a year or two, if we don't have any more certainty with a permit, to make sure the population growth projections, and the projects identified are reflective and timed properly. The reason for not going forward with a full Facilities Plan update is because that requires predicting the future which needs to have the regulatory requirements and the additional capital projects set. We don't have any certainty until we get the permit. President Inge asked if we are on track in terms of our ability to be able to handle what we will need to handle through 2025 at least and beyond. Matt Stouder said he believes so. Mr. McAllister added that the big push was the peak flow performance. The treatment plant was upgraded for peak flow and we will continue to deal with the local sides to deal with the budget system. Staff will monitor the permit requirements and new elements that might come into play that require other MWMC Meeting Minutes February 9, 2018 Page 7 of 14 technology or refinement with our flows and loads. Staff is watching closely the population trend. Mr. Stouder added that the partial update showed the flow and loads were not as high as anticipated. Commissioner Pishioneri said he wanted to go back to the generator topic. He said the questions he has are is it performing as designed regardless of age, is there redundancy if it fails, and are we truly replacing it because it is loud? Mr. Anderson replied that it is being replaced because of both issues, its age and because of the noise complaints regarding it. Commissioner Pishioneri said looking at it as a tax payer/rate payer; he doesn't like spending money unless it needs to be replaced because of a performance issue, as long as there isn't a redundancy issue, then keep it on line. If it starts to fail, then replace it at that time. It is almost $100,000. He asked what the rest of Commissioners thinks. Commissioner Meyer said in regards to the DCS replacement, they are essentially 20-year-old technology or maybe older. He asked if they were being replaced with off-the-shelf equipment and software so we won't be hostage to a distributor. Mr. Watkins replied that two years ago staff did an evaluation on whether to maintain and progress with the Yokogawa DCS, to switch to an alternate provider of DCS, or to go with a different platform such as a network PLC (Programmable Logic Controller) system. The evaluation came to the conclusion that it is cost prohibitive to change and you would be just changing which system you are locked into. The Yokogawa architecture is a lot more resilient from a hardware standpoint. It is a lot more stable than what is currently available in PLCs. PLCs are a little bit more ahead of the curve from a technical functionality, features and communication capabilities. But with that comes the instability like your PC at home. It is okay to hit restart on your PC at home, but when you are controlling a process environment it is not. The reliability and stability was the preferred value so that is why the Yokogawa operating system was chosen. The DCS costs listed are to improve security because we are sending data to the business side of the network for report running and operation control. To send information that way we need to have a more resilient DMZ zone and switches that are configured to be more secure from outside penetrations. It will also include an antivirus and more of the industry standard recommended security protocols and procedures. Then there is the wireless control which allows more flexibility and hands-on operation. With that come the antennae, repeaters, and software. The security package includes keeping the wireless portion secure. Commissioner Meyer said that he is glad that staff is paying attention to cyber security, it is a serious issue. Commissioner Meyer said he wanted to follow-up on Commissioner Pishioneri's question. He believes that both cities have noise ordinances. So if you pulled the generator out in the neighborhood in the middle of the night, does it meet the noise ordinance? That is a question you would want to answer. Commissioner Pishioneri replied, he expects that it doesn't. Commissioner Keeler said he wanted to respond to the generator questions that both Commissioner Pishioneri and Commissioner Ruffier had. He said there is calendar age and usage age (how many hours it has run), staff knows those. Typically with a generator, you want it in the middle of the night and you want it to be reliable. He said staff does a good job in general with getting assets passed their expected life. He trusts the staff's judgement; there are a lot of factors that go into it. Mr. Breitenstein added that you want to replace assets at the right time so you get a good recycle value to help offset the replacement cost as well as optimum usage. MWMC Meeting Minutes February 9, 2018 Page 8 of 14 Commissioner Pishioneri said that he is glad the Commission discussed it and is comfortable with the replacement. FATS, OILS, AND GREASE (FOG) FOOD SERVICE PROGRAM UPDATE Shawn Krueger, Springfield Environmental Services Supervisor, stated that Fats, Oils and Grease (FOG) management and control program is implemented through the Industrial Pretreatment program which is a federal program with the following goals: • Prevent the discharges of pollutants that can interfere with the operation of the treatment plant and collection system or pass through to the river untreated • Improve opportunities to recycle and reclaim municipal and industrial wastewaters and biosolids. • Protect collection system workers, the treatment plant, and the environment Michelle Miranda, Eugene Environmental Services Supervisor, stated the foundation of the pretreatment program is the legal authority to implement it. The "you shall" comes from the federal statute, the Clean Water Act (CWA), and it is published in the Federal Code of Regulations. The Oregon State Statutes stipulate that publicly owned treatment works (POTWs) which discharge more than one million gallons per day to waters of the State must implement an Industrial Pretreatment Program that meets the requirements of the Federal Code of Regulations (CFR 403). MWMC's National Pollutant Discharge Elimination System (NPDES) permit details Pretreatment Program requirements in Schedule E which was approved by the DEQ in 1983. Locally, a Model Pretreatment Ordinance details pretreatment requirements and then respectively in each cities' municipal code. Mr. Krueger said revisions to the Model Ordinance and then to each city's code occurred in 1996 and allowed for the implementation of pollution management/prevention activities. During that time, staff was finding out that Pollution Management Practices (PMPs) programs were an efficient way for pretreatment programs to deal with food service establishments (FSEs) and the numeric limit was replaced with the requirement to following the PMP. Ms. Miranda stated, in general, pollution prevention programs are an effective and efficient way to use resources to reduce or eliminate the discharge of specific contaminants to the wastewater collection system. They work especially well when applied to low-flow/and widespread commercial sectors (like FSEs). The approach is an education and inspection approach and it happens without the expense of issuing permits. Commissioner Keeler asked what FSEs are. Ms. Miranda replied Food Service Establishments are any place that serves food, not just restaurants but also grocery stores and any kind of kitchen such as churches and schools. Mr. Krueger said the Pretreatment staff takes the following approach to administer a PMP program which has been successful at preventing pollution. • Issue a general requirement letter and education material designed for individual business sectors • Conduct periodic inspections, perform tracking, record keeping, investigations, compliance follow-up, and enforcement MWMC Meeting Minutes February 9, 2018 Page 9 of 14 • Staff is committed to maintaining service oriented relationships with area businesses and strive to create flexible and cost effective solutions which take into account the business needs of customers, while assuring compliance with all applicable environmental regulations Why is it important to have a FOG program? FOG can cause a lot of problems such as blockages, sewer backups, reduction in effective line size, deterioration of collection system integrity, increased maintenance of the collection system, and sanitary sewer overflows (SSOs). The FOG program focuses on reducing FOG entering the collection system, eliminating FOG- caused sewer overflows, and reducing time spent on enforcement. To accomplish these outcomes, staff works to educate and inform FSEs about the FOG program, why proper management of FOG discharges is important, and why it applies to the facility. Staff also works with the following partners: Lane County Health Department to update their list of newly licensed FSEs, the planning departments and developers to make sure new or remodeled food service establishments have plumbing that will meet the discharge requirements, and the cities' maintenance crews to identify "hot spots" to control grease blockages. Ms. Miranda said currently there are 914 PMP requirement letters issue to FSEs (mostly restaurants). Of those, 732 are located in Eugene and 182 located in Springfield. In 2017, 62 new general requirement letters (Eugene 53 issued, Springfield 9 and 46 reissued), conducted 72 FSE site visits (56 Eugene, 16 Springfield), 2 FOG related SSOs (Eugene), and 6 enforcement and follow-up actions with requirements to make improvements to reduce the discharge of FOG to the wastewater collection system (Eugene 4, Springfield 2). Mr. Krueger said in staff's work to educate and inform FSEs about proper management of FOG they use outreach material such as the FOG flier (showed during presentation). It is handed out during site visits as well as at community events within the service area. FOG prevention has been identified as one of the MWMC's prevention campaign topics. The Communication team, along with Pretreat staff, has developed insert cards which increase awareness of the MWMC and its role in the health and vitality of our community and environment as well as increase awareness of FOG and how to prevent it from entering the wastewater system. The insert cards are part of a FOG kit which will be handed out at MWMC sponsored events. They include a scraper tool used to transfer FOG into a metal can along with a lid to cover and store in the freezer. The Communication team has also drafted a one-page FOG outreach plan identifying goals, objectives, and strategies to increase awareness of FOG. Most recently, they created a Facebook post on FOG. Commissioner Keeler said he received the flier in his utility bill this past month and he thought it was very nicely done; high quality and attractive to look at. Public education and public awareness is essential to effective pollution prevention and water resources management. Industrial Pretreatment programs work mainly with the permitted/ regulated communities. A lot of FOG comes from the residential sector (non-regulated). Future program activities, both mandated and voluntary, will include both public education and PMP program components. MWMC Meeting Minutes February 9, 2018 Page 10 of 14 DISCUSSION: Commissioner Meyer asked when the last time the Pretreatment Program was audited by the DEQ and what was the outcome. Ms. Miranda replied in 2015 and it was a very successful audit. Both the DEQ and the EPA did the audit and noted that our program was one of the best and in the top echelon. Mr. Krueger added there were some recommendations to improve our program, update our tracking sheet and inspection forms. The biggest recommendation was for us to do a technical evaluation of our local limits which staff is currently working on. Commissioner Ruffier asked if the Pretreatment Model Ordinance contain specifics about implementation of PMP for FOG. Ms. Miranda replied that there are no specifics but staff sets internal program goals. Commissioner Farr said that he was looking at the Best Management Practices (BMPs) regarding FOG nationwide, it is a big issue. What he is seeing the most effective use of resources is training, making sure people know what they are doing. Commissioner Keeler said that the audit done in 2015 was much more comprehensive than what they typically do and included both DEQ and EPA and we came out very well. Ms. Miranda said staff submitted a sampling plan that was approved by the DEQ, and they currently are in the midst of the sampling plan and collecting data. Staff will generate a report that will be submitted in 2019 to DEQ. Commissioner Ruffier stated that he appreciates the efforts that go into FOG but thinks we should up the level of inspections. We are supposed to have zero SSOs and we had three from FOG in a year that is significant. The report said 72 FSE site visits but 34 were done in one month. It would probably behoove us to up the level of inspections and spread them throughout the year. He thinks staff needs to become more aggressive in the actual implementation of PMPs at some of these FSEs. Ms. Miranda stated that an important change was implemented at the beginning of this year. In Eugene, the way the FOG program was managed was to divide and conquer between the three inspectors. In January that was changed so one dedicated person is doing FOG and PMP tasks; they have additional duties but she is thinking with this change that they will see some improvements this year. Commissioner Ruffier said that at the rate they were doing inspections only 10% of the FSEs that are permitted are being inspected per year. It might be better to try and up that percentage to get better coverage and more educational outreach. Mr. Krueger stated that there is a lot of turnover in restaurants, but he thinks Commissioner Ruff ier's point is valid. Typically they respond to complaints from the collection system staff but other than that they assume that they are following the general requirements, maintaining their grease interceptors accordingly, but he does think visiting more frequently would be a benefit. Commissioner Ruffier said long term Fog can damage the collection system and deteriorate the pipes. MWMC Meeting Minutes February 9, 2018 Page 11 of 14 MWMC FINANCIAL PLAN DISCUSSION #2 — RESERVES Katherine Bishop, Environmental Services Program Manager, and Meg Allocco, MWMC Accountant, made the staff presentation. Ms. Bishop went over how the reserves are budgeted to the end of the fiscal year (FY). For FY 2017-18 the three largest components of the reserves are Capital Reserve, Equipment Replacement Reserve, and the Operating Reserve. The other reserves are as follows: Reimbursement SDC, Improvement SDC, Eugene Working Capital, Springfield Working Capital, SRF Loan, Insurance, Rate Stabilization and Rate Stability. Ms. Allocco stated that the majority of the reserves are funded from user fees, septage fees, interest income, and other operating revenues. The exception is the SDC Reserves which come from the SDC reimbursement fees, SDC improvement fees, and interest earnings. Specific Reserves: Working Capital Reserve. $700,000 Eugene, $200,000 Springfield - covers cash flow requirements for cities until reimbursed by MWMC. Operating Reserve. Budget for contingencies 10-15% of operating budget or recommended minimum two months of expenses. Rate Stability Reserve. Flat $2 million set aside to avoid rate spikes in the event of loss of large customer or economic downturn. Rate Stabilization Reserve. Flat $2 million required by the bond covenants to be used only to meet coverage ratio requirements. MWMC has never had to use this, but it is a requirement of the bond. SRF Loan Reserve: $671,000. This is required by State of Oregon (DEQ) for the revolving fund loans. The amounts are determined individually per loan and to be used only if necessary to make the debt service payment. To date, we have never had to draw on them. Insurance Reserve: $515,000. This reserve was established at the request of the Commission to offset our deductible (currently $250,000 per occurrence) when we changed to a higher insurance deductible, resulting in insurance premium savings. Capital Reserve: Budgeted to end FY 2018 at $37.4 million. This reserve accumulates revenues to fund capital projects (including major rehabilitation). This is funded by annual contributions from user rates. Current policy says this is not allowed to fall below $1 million. Equipment Replacement Reserve. Accumulates funds necessary to provide for timely replacement of equipment. This is funded by user rates. SDC Reserves: Comprised of revenues derived from the reimbursement and improvement fee components of the SDC's charged to new development. These are tracked separately so spending is in accordance with ORS 223.311. Equipment Replacement: On average, the MWMC has spent less than what it has contributed over the last 14 years as assets' lives have extended. Recently, additional assets have been added so the list has grown. The updated Asset Management Plan will help to bring this reserve into alignment with the actual assets. The reserve balance reflects a gradual increase over time. Equipment Replacement Policy Language: The 2005 Financial Plan — Page 12 Policy F5d) states the Equipment Replacement Reserve is intended to accumulate funds necessary to provide MWMC Meeting Minutes February 9, 2018 Page 12 of 14 for the timely replacement or rehabilitation of equipment. The wording in the policy says, "The annual contribution is set so that all projected replacements will be funded over a 20-year period." Ms. Bishop said this is an area that staff would like to have a discussion with the Commission. She said it seems like the language could be a minimum of five to ten years rather than 20 years. To actually have the reserve cover 20 years would be a very large amount of money. Staff would like to bring this back for further discussion. SRF Loans: A slide showing the five loans with balance, interest rate, remaining interest, and payoff date was shown. The total balance amount is $13,040,700 and remaining interest total is $2,497,400. Ms. Bishop said our thinking has to do with pay-as-you-go financing and to avoid a new revenue bond. Sometimes there is a view that we are sitting on a pretty good amount of capital dollars, but at the same time we have SRF loan obligations with associated interest expenses. Ms. Bishop wanted to remind the Commission that we do have this debt and there may be opportunities to pay off a portion of this debt; there is no penalty for early payoff. Mr. Stouder added this is one of those areas staff will be looking for guidance. It can be worked into some future conversations on the Financial Plan Policies to find out how the Commission would like to get the loans paid off. DISCUSSION: Commissioner Keeler said he is thankful for MWMC's strong financial position. He is curious what the value is of all the reserves. Ms. Bishop said as of December 31, 2017 it was $87.6 million total, of that 80% ($70M) is in the capital area, which includes the Capital Reserve, the Equipment Replacement Reserve, and the two SDC Reserves. The remaining 20% is operating related, including Working Capital and Stabilization. Commissioner Keeler said he appreciated the Reserve Diagram. His recollection of what used to be called the Spaghetti Chart was a lot more complex than the Reserve Diagram. It showed the interactions between the various reserves and how money could be moved either with Board authority or in some cases without. He understands the difficulty in recreating it. He asked if we could have an SDC Reserve and a multipurpose reserve for all the other reserves to save on book work. Ms. Bishop replied that one of the primary benefits is that the Financial Plan creates the structure so if there is a turnover in staff they understand the different areas of reserve funds and their function. The rating agencies or the auditors are looking at the framework of our policies and procedures and they actually view these individual reserves as wise, forward thinking and that we have covered all of our bases. It is one of the reasons why the MWMC's credit rating is so high. Commissioner Ruffier said he was thinking along the lines of Commissioner Keeler, we have a strong financial position but a lot of reserves. He asked if the Rate Stability and Rate Stabilization reserves are interchangeable. Ms. Allocco replied no, that the Rate Stabilization has to stay in that bucket by the bond requirement and can only be used if we have trouble making our coverage ratio. Commissioner Ruffier said, isn't the purpose the same, to cover loss of revenue. Ms. Allocco replied in one way it is. The Rate Stability reserve can be moved at any time and could be moved into the actual Operating Reserve. Commissioner Ruffier clarified that the Rate Stability reserve could be redistributed or dropped entirely. Commissioner Ruffier asked if we have ever drawn from the Operating Reserve. Ms. Allocco said when we do a Supplemental Budget for a new expense on the operating side, it comes from the Operating Reserve but it is not common. She said that more often we add money to it from money not spent. Commissioner Ruffier said that is 10% of the budget. Ms. Allocco said 10-15% of the budget. MWMC Meeting Minutes February 9, 2018 Page 13 of 14 Commissioner Ruffier said the Insurance Reserve seems redundant with the Operating Reserve. If you are paying a $500,000 deductible but you have 10% of your budget in the Operating Reserve, you could use that for the deductible. Ms. Bishop said you could. However, earlier direction from the Commission was to plan forward to grow the insurance reserve as we moved to a higher deductible and increased our self-funding for insurance. We will have additional discussions on this item. President Inge said that most of the reserves are set but there are a few that we contribute to on a regular basis. He asked how many reserves we are contributing to on a monthly basis. Ms. Allocco said an annual contribution is made to the Equipment Replacement and to the Capital Reserve from the Operating Revenues; the rest are set. President Inge confirmed that there are no additional expenses happening to the rate payer going forward on the reserves that are already in place. President Inge said it is a large sum of money and we are getting interest on it. But when you are in a great financial position, it is easy to look at this and say, "Should we have all this money sitting there." Times can change really fast and we need to be forward thinking. Our rates are generally still relatively low compared to our sister cities around the state. He is in favor in maintaining reserves but does not want to see them climb unless we have a good rational reason for them to do so. Commissioner Meyer asked what the status is on the Asset Management Program that will inform us on our future equipment replacement situation. John Huberd, Finance and Administration Manager, replied that staff has been making adjustments to the Asset Management Plan over the last year. One of the things they are working on is to do an annual Asset Management Plan. This is based off of Best Practices, ISO 5500 Asset Management Program. It is very comprehensive and starts looking at service levels and less successful risks and from that information staff will develop certain things that they want to use more of such as asset condition monitoring, bring in long life assets and infrastructure assets that haven't been captured. The first Asset Management Plan will be prepared next December. Mr. Stouder added that staff has an agenda item scheduled to come to the Commission to talk about an update on that. It will be in the next few months, depending on the scheduling. Commissioner Ruffier said he is interested in a discussion in paying off some of the loans early and whether or not some of the reserves could be used to do that. President Inge said that he is still very interested in becoming self-insured. Insurance rates are astronomical. Commissioner Meyer said that while there is an urge to simplify the reserves, keeping track, the way we do with the reserves, helps us to make sound decisions. For example, since we have a separate insurance reserve we have tracked the savings we have made since going to a higher deductible. Maintaining that reserve and continuing to monitor how we are doing in terms of deductibles and what we are paying for premiums, educates the board in terms of future decisions on what we want to pay. If we just drop it, and then five years down the road there is a major claim, the future board will be wondering what we were thinking —why is the deductible so high. We need to continue to track it that way so we know we are making decisions that make sense. It is a double edge sword. President Inge asked for amounts to be placed on the reserve handout. Ms. Allocco said she could do that. MWMC Meeting Minutes February 9, 2018 Page 14 of 14 BUSINESS FROM COMMISSION, GENERAL MANAGER, AND WASTEWATER DIRECTOR General Manager: • Up-coming presentations to groups: February 15th - Goodpasture Island Neighbors Association, Springfield Lions Club - end of February, and the Emerald Empire Kiwanis Club in Eugene - March. • Ms. Spiro had name tags made for the Commissioners so that if one of the Commissioners would like to attend one of the meetings and or other public events, they have a name tag. o Commissioner Pishioneri requested that an email be sent out with the dates of the activities to the Commissioners. Mr. Stouder replied he would do that. • SDC Work Session is on Friday, April 6th • Commissioner group photo that was going to betaken today will be pushed out until all Commissioners are in attendance. Mr. Stouder said he would remind them. Wastewater Director: • Safety Performance Indicators: Last month Commissioner Keeler inquired about safety performance indicators. Mr. Breitenstein talked to the plant's Safety Manager and will bring some lagging indicators back to show the Commission and is looking into some leading indicators to show as well. • Septage Analysis: Mr. Breitenstein has been reviewing the current septage rates and further developing the methodology to improve the cost-of-service model. He will be bringing that information back to the Commission at a future meeting. Currently the Septage Program is working very well in terms of functionality and revenue. o Commissioner Ruff ier asked if he would include in that analysis the non-domestic waste. Mr. Stouder answered that it will be discussed at the next meeting. ADJOURNMENT President Inge adjourned the meeting at 9:34 a.m. Submitted by: Kevin Kraaz UPDATED AGENDA ITEM V Metropolitan Wastewater Management Commission ^—A-k SPRINGFIELD - y.. OREGON partners in wastewater management MEMORANDUM DATE: March 8, 2018 TO: Metropolitan Wastewater Management Commission (MWMC) FROM: Josh Newman, Managing Civil Engineer SUBJECT: Resiliency Planning (P80096) Consultant Selection ACTION Approve Resolution 18-03 authorizing staff to execute a Consultant REQUESTED: Services Agreement with Carollo Engineers. ISSUE Staff requests Commission approval of Resolution 18-03 (Attachment 1 or Attachment 2, depending on the outcome of Commission discussion of the scope alternatives described below), authorizing the MWMC Executive Officer to designate qualified staff to execute a contract with Carollo Engineers for engineering consultant services in support of the MWMC's Resiliency Planning Project P80096. DISCUSSION On March 1, 2018 staff received Carollo Engineers' fee proposal to deliver the scope of work outlined in the Resiliency Planning Consulting Services request for proposals (RFP). The amount of the proposed fee was $696,000. This amount exceeded the anticipated MWMC project budget of$500,000. To better align the fee proposal with the existing project budget assumption, staff considered an alternative where the scope was reduced by removing the seismic assessments for the following facilities, which were thought to be lower priorities relative to other MWMC facilities immediately following a disaster: • Biosolids Management Facility (and associated force mains and infrastructure) • Beneficial Reuse Site • Wet Weather Pump Station (Located in Springfield near the site of the old Springfield treatment plant) Removal of these scope elements resulted in a fee amount of $666,000, which is $30,000 less than the full scope of work. In the early weeks of the project, one of the preliminary tasks will be to set level-of- service (LOS) assumptions for key MWMC infrastructure through a workshop facilitated by the consultant. It is possible that this process may lead to a need to add back into the project scope one or more of the bullet listed facilities above. Memo: Resiliency Planning (P80096) Consultant Selection March 8, 2018 Page 2 of 2 Given the higher-than-expected fee proposal, staff has prepared two versions of Resolution 18-03 for Commission consideration: • Alternative 1 - Full scope contract with a not-to-exceed value (NEV) of $696,000 (Attachment 1) • Alternative 2 - Reduced scope contract with an NEV of$696,000 (Attachment 2) Alternative 1 authorizes the full amount, relies on staff negotiations and project execution strategies to control contract expenses. Alternative 2 authorizes a reduced amount and could require future commission approval to add removed scope items back into the project. RECOMMENDATION Staff recommends negotiating an agreement for Consultant Services with Carollo Engineers for the full scope of work (Alternative 1 , Attachment 1) for an NEV of $696,000 in accordance with 137-048-0220 of the MWMC Model Procurement Rules ACTION REQUESTED Approval of Resolution 18-03 (either Alternative 1 or Alternative 2 as described above) authorizing staff to execute a Consultant Services Agreement with Carollo Engineers for an NEV of $696,000 if alternative 1 is selected, or an NEV of $666,000 if alternative 2 is selected. ATTACHMENTS 1 . Draft Resolution 18-03 (Alternative 1 — NEV of $696,000) 2. Draft Resolution 18-03 (Alternative 2 — NEV of$666,000) METROPOLITAN WASTEWATER MANAGEMENT COMMISSION RESOLUTION 18-03 ) IN THE MATTER OF CONTRACT AWARD OF ENGINEERING CONSULTING SERVICES MWMC PROJECT P80095 — RESILIENCY PLANNING WHEREAS, the Metropolitan Wastewater Management Commission (MWMC) intends to approve $750,000 for Project P80096 — Resiliency Planning as part of the Supplimental Budget Request # 3 for the FY 17-18 budget, which will include consultant fees described herein plus administrative costs such as staff and legal expenditures; WHEREAS, the MWMC has followed the procedures for Formal Selection set forth in MWMC's Procurement Rule 137-048-0220; WHEREAS, MWMC advertised an RFP for the Resiliency Planning contract on January 26, 2018; WHEREAS, MWMC received one (1) proposal from a qualified respondent, Carollo Engineers, for technical services on February 23, 2018; WHEREAS, an interagency evaluation committee from Springfield Environmental Services Division and Eugene Wastewater Division (Evaluation Team) evaluated the proposal pursuant to the criteria in the RFP and applicable law and determined that Carollo Engineers scored favorably across all criteria; WHEREAS, pursuant to MWMC Rule 137-048-240, a notice of MWMC's intent to award the contract was issued on February 28, 2018; WHEREAS, pursuant to the requirements listed in the RFP, Carollo Engineers submitted a fee proposal to the MWMC on March 1 , 2018, for provision of the Work and the fee proposal value was $696,000; WHEREAS, pursuant to MWMC Rule 137-048-0240, the award of the contract may become final if no valid protest is received within seven (7) calendar days after the date of the notice of intent to award the contract, and because no other proposals were received no valid protests can be filed; NOW, THEREFORE, BE IT RESOLVED BY THE METROPOLITAN WASTEWATER MANAGEMENT COMMISSION THAT: Tom Boyatt, as the duly authorized Executive Officer of the MWMC, is hereby authorized to: (a) designate qualified staff to negotiate and execute a consultant services contract with Carollo Engineers for an authorized amount not-to-exceed value (NEV) of $696,000; and (b) delegate performance of project management functions including, but not limited to, issuance of notices to proceed, contract amendments not to exceed a cumulative total of 15% of the initial contract amount, and management of the contract to ensure deliverables and services meet the contract requirements. ATTACHMENT 1 Resolution 18-03 Page 1 of 2 ADOPTED BY THE METROPOLITAN WASTEWATER MANAGEMENT COMMISSION OF THE SPRINGFIELD/EUGENE METROPOLITAN AREA ON THE 9" DAY OF MARCH 2018. PRESIDENT: ATTEST: Secretary: Kevin Kraaz Approved as to form: MWMC Legal Counsel: K.C. Huffman ATTACHMENT 1 Resolution 18-03 Page 2 of 2 METROPOLITAN WASTEWATER MANAGEMENT COMMISSION RESOLUTION 18-03 ) IN THE MATTER OF CONTRACT AWARD OF ENGINEERING CONSULTING SERVICES MWMC PROJECT P80095 — RESILIENCY PLANNING WHEREAS, the Metropolitan Wastewater Management Commission (MWMC) intends to approve $720,000 for Project P80096 — Resiliency Planning as part of the Supplimental Budget Request # 3 for the FY 17-18 budget, which will include consultant fees described herein plus administrative costs such as staff and legal expenditures; WHEREAS, the MWMC has followed the procedures for Formal Selection set forth in MWMC's Procurement Rule 137-048-0220; WHEREAS, MWMC advertised an RFP for the Resiliency Planning contract on January 26, 2018; WHEREAS, MWMC received one (1) proposal from a qualified respondent, Carollo Engineers, for technical services on February 23, 2018; WHEREAS, an interagency evaluation committee from Springfield Environmental Services Division and Eugene Wastewater Division (Evaluation Team) evaluated the proposal pursuant to the criteria in the RFP and applicable law and determined that Carollo Engineers scored favorably across all criteria; WHEREAS, pursuant to MWMC Rule 137-048-240, a notice of MWMC's intent to award the contract was issued on February 28, 2018; WHEREAS, pursuant to the requirements listed in the RFP, Carollo Engineers submitted a fee proposal to the MWMC on March 1 , 2018, for provision of the Work and the fee proposal value was $666,000; WHEREAS, pursuant to MWMC Rule 137-048-0240, the award of the contract may become final if no valid protest is received within seven (7) calendar days after the date of the notice of intent to award the contract, and because no other proposals were received no valid protests can be filed; NOW, THEREFORE, BE IT RESOLVED BY THE METROPOLITAN WASTEWATER MANAGEMENT COMMISSION THAT: Tom Boyatt, as the duly authorized Executive Officer of the MWMC, is hereby authorized to: (a) designate qualified staff to negotiate and execute a consultant services contract with Carollo Engineers for an authorized amount not-to-exceed value (NEV) of $666,000; and (b) delegate performance of project management functions including, but not limited to, issuance of notices to proceed, contract amendments not to exceed a cumulative total of 15% of the initial contract amount, and management of the contract to ensure deliverables and services meet the contract requirements. ATTACHMENT 2 Resolution 18-03 Page 1 of 2 ADOPTED BY THE METROPOLITAN WASTEWATER MANAGEMENT COMMISSION OF THE SPRINGFIELD/EUGENE METROPOLITAN AREA ON THE 9" DAY OF MARCH 2018. PRESIDENT: ATTEST: Secretary: Kevin Kraaz Approved as to form: MWMC Legal Counsel: K.C. Huffman ATTACHMENT 2 Resolution 18-03 Page 2 of 2 AGENDA ITEM VI Metropolitan 'Wastewater Management Commission SPRIPIG'FIELD r OREGON partners in wastewater management MEMORANDUM DATE: March 2, 2018 TO: Metropolitan Wastewater Management Commission (MWMC) FROM: Katherine Bishop, ESD Program Manager SUBJECT: Preliminary FY 2018-19 Regional Wastewater Program Budget ACTION Provide comments and direction to staff for finalization of the Regional REQUESTED: Wastewater Program Budget for FY 2018-19 ISSUE The Preliminary Regional Wastewater Program (RWP) Budget and Capital Improvements Program for fiscal year 2018-19 (FY 18-19) is attached for your review. During the Commission meeting on March 9, 2018, staff will present the proposed operating budget as well as scenarios for FY 18-19 user rates for consideration. The Commission is requested to provide input and direction on the Preliminary RWP Budget and Capital Improvements Program Budget for finalization of the budget document in preparation for the public hearing on April 13, 2018. BACKGROUND AND DISCUSSION On January 12, 2018, the Commission reviewed the proposed Key Outcomes and Performance Indicators as part of the Budget Kick-Off. On February 9, 2018, the Commission reviewed the proposed Capital Budget and 5-Year Capital Plan. Proposed Capital Programs Budget- The proposed FY 18-19 capital programs budget is $34,100,000. About 40% ($14M) of the capital budget amount is programmed for contract awards in the current FY 17-18 that will continue into FY 18-19 spanning multiple years. Projects include: Operations & Maintenance Building Improvements, the Electrical Distribution System Replacement and Upgrades, Increasing Digestion Capacity, Resiliency Planning, and Poplar Harvest Management Services. The 5-year capital program budget plan total is $93,234,000 as displayed on page 44 of the budget (Attachment 1) in Exhibit 13. Proposed Operating Program Budget- The total proposed FY 18-19 operating program budget is $18,119,417 reflecting a decrease of 0.9% ($168,783) when compared to the FY 17-18 adopted budget. Exhibit 3, on page 14 of the preliminary budget document, displays the RWP operating budget summary by program area. Memo: Preliminary FY 2018-19 Regional Wastewater Program Budget March 2, 2018 Page 2 of 2 ■ Operations and Maintenance - The proposed operations and maintenance budget for Eugene is $14,149,751, reflecting an overall decrease of 1.4% ($196,549) when compared to the adopted FY 17-18 budget. The personnel services component of the budget reflects a budget increase of 2.4% ($212,493) in regular wages and employee related benefits. Full- time equivalent (FTE) staffing includes an increase of 0.96 FTE (1.2%) resulting in a total 78.36 FTE. The materials and services budget reflects a total net budget decrease of 8.9% ($464,888), and the capital outlay budget reflects a one-time increase of $55,846. Exhibit 11, on page 36 of the budget document displays the Eugene operations and maintenance line item budget summary. ■ Administration - The proposed administration budget for Springfield is $3,969,666, reflecting an overall net decrease of 0.7% ($27,766) when compared to the adopted FY 17-18 budget. The Administration FTE staffing remains level at 15.56 FTE. The personnel services budget reflects a budget increase of 5.2% ($94,579) in regular wages and employee related benefits. The materials and services budget reflect a net budget decrease of 3.1% ($66,813). Exhibit 9, on page 30 of the budget document displays the Springfield administration line item budget summary. Proposed User Fee Rate Change - The Preliminary RWP Budget for FY 18-19 is based on a 2.5% user fee rate change effective July 1, 2018. The proposed 2.5% rate change is less than previously forecasted at 3.0%. The proposed rate change takes into consideration customer activity, reserve funding levels, changes in operations and maintenance, administration and the proposed capital program plan budgets included in the preliminary budget document. ■ Fiscal Impact to the Typical Residential Monthly Bill- The proposed 2.5% rate change to the regional wastewater component would result in a $0.64 monthly increase from $25.85 to $26.49 for a typical residential customer based on 5,000 gallons of wastewater treated. With the proposed 2.5% rate change, sufficient revenues will be generated to fund daily operations, planned capital projects and debt service obligations, while maintaining a positive financial position and capital reserves with a focus on pay-as-you-go funding for capital improvements. Rate scenarios will be presented at the March 9 meeting for Commission consideration and direction. ACTION REQUESTED The Commission is requested to provide comments and direction for finalization of the Regional Wastewater Program Budget and Capital Improvements Program FY 18-19. ATTACHMENT 1. Preliminary FY 2018-19 Regional Wastewater Program Budget Preliminary Regional Wastewater Program Budget and Capital Improvements Program ,• ,►s... ,, ,., -A WSU �� +a to , 4 Metropolitan Wastewater MANAGEMENT COMMISSION AM SPRINGFIELD �4RiG4N Fiscal Year 2018- 19 partners in wastewater management 19 Preliminary REGIONAL WASTEWATER PROGRAM BUDGET and CAPITAL IMPROVEMENTS PROGRAM Fiscal Year 2018-19 The Metropolitan Wastewater Management Commission is scheduled to adopt its Operating Budget and Capital Improvements Program (CIP) for FY 18-19 on April 13, 2018. The Budget and CIP are currently scheduled for consideration and ratification by the Springfield City Council on May 7, 2018, the Eugene City Council on May 14, 2018, and the Lane County Board of Commissioners on May 15, 2018. The Commission is scheduled for final consideration and ratification of the Budget and CIP on June 8, 2018. COMMISSION MEMBERS: Bill Inge, President(Lane County) Peter Ruffier,Vice President(Eugene) Pat Farr(Lane County) Doug Keeler (Springfield) Walt Meyer(Eugene) Joe Pishioneri (Springfield) Jennifer Yeh (Eugene) STAFF: Tom Boyatt, Interim MWMC Executive Officer/Springfield Development& Public Works Director Matthew Stouder,MWMC General Manager/Springfield Environmental Services Manager Dave Breitenstein, Interim Eugene Wastewater Division Director Robert Duey, MWMC Finance Officer/Springfield Finance Director www.mwmoartners.org MWMC's Video Series may be viewed at: www.youtube.com/c/MWMCPartners Metropolitan Wastewater Management Commission Overview METROPOLITAN WASTEWATER MANAGEMENT COMMISSION Preliminary FY 18-19 BUDGET AND CAPITAL IMPROVEMENTS PROGRAM for the REGIONAL WASTEWATER PROGRAM TABLE OF CONTENTS PROGRAM OVERVIEW BudgetMessage.. .....................................................................................................................1 Acronymsand Explanations.....................................................................................................3 Regional Wastewater Program Overview................................................................................5 Exhibit 1: Interagency Coordination Structure ...............................................................11 BUDGET SUMMARY Regional Wastewater Program Budget and Program Summary............................................12 Exhibit 2: Regional Operating Budget Summary ...........................................................12 Exhibit 3: Line Item Summary by Program Area...........................................................14 Exhibit 4: Budget Summary and Comparison.................................................................15 RESERVE FUNDS Regional Wastewater Program Reserve Funds......................................................................19 Exhibit 5: Operating Reserves Line Item Budget ...........................................................20 OPERATING PROGRAMS Regional Wastewater Program Staffing.................................................................................23 Exhibit 6: Regional Wastewater Program Organizational Chart....................................23 Exhibit 7: Regional Wastewater Program Position Summary ........................................24 Springfield Program and Budget Detail.................................................................................26 Exhibit 8: Springfield Administration Program Budget Summary.................................29 Exhibit 9: Springfield Administration Line Item Summary............................................30 Eugene Program and Budget Detail.......................................................................................31 Exhibit 10: Eugene Operations &Maintenance Program Budget Summary...................35 Exhibit 11: Eugene Operations &Maintenance Line Item Summary..............................36 CAPITAL PROGRAM Regional Wastewater Capital Improvements Program..........................................................37 Exhibit 12: Capital Program Budget Summary................................................................41 Exhibit 13: Capital Program 5-Year Plan ........................................................................44 CAPITAL PROJECT DETAIL Capital Program Project Detail Sheets...................................................................................45 Metropolitan Wastewater Management Commission Budget Message BUDGET MESSAGE Members of the Metropolitan Wastewater Management Commission (MWMC) MWMCs' Customers and Partnering Agencies We are pleased to present the Metropolitan Wastewater Management Commission's budget for fiscal year 2018-19. This budget funds operations, administration, and capital projects planned for the Regional Wastewater Program. MWMC Background The Metropolitan Wastewater Management Commission (MWMC) was formed by Eugene Springfield, and Lane County through an intergovernmental agreement (IGA) in 1977 to provide wastewater collection and treatment services for the Eugene-Sprinfield metropolitan area. The seven-member Commission, appointed by the City Councils of Eugene and Springfield and the Lane County Board of Commissioners, is responsible for oversight of the Regional Wastewater Program. Since 1983, the Commission has contracted with the cities of Springfield and Eugene to provide all staffing and services necessary to maintain and support the Regional Wastewater Program. The MWMC has been quietly providing high-quality wastewater services to the metropolitan area for 41 years. The combined Eugene-Springfield population is about 228,400, with the MWMC providing wastewater services for approximately 78,000 residential and commercial accounts. The MWMC is committed to clean water,the community's health, and the local environment, and to providing high quality services in a manner that will achieve, sustain, and promote balance between community, environmental, and economic needs. Budget Development Process The MWMC's budget development schedule begins in January,with a budget kick-off to review key outcomes the Commission strives to achieve, along with performance indicators identified to measure results of annual workplans over time. February includes a presentation of the draft Capital Improvement Program (CIP)budget and five-year capital plan, and in March the operating budget programs and user fee rate scenarios are presented for discussion and direction. In April, the Commission holds public hearings on the Preliminary Regional Wastewater Program (RWP) Budget and CIP and regional wastewater user rates. In May, the RWP budget is provided to the three governing bodies of Springfield, Eugene and Lane County for their review, input and ratification. The RWP Budget and CIP returns to the MWMC in June for final approval, with budget implementation occuring July 1. Fiscal Year 2018-19 Budget Administration and Capital Improvements Program (CIP) components of the MWMC's budget are reflected in the City of Springfield's RWP budget. Operations, maintenance, equipment replacement,major rehabilitation, and major capital outlay components are reflected in the City of Eugene's RWP budget. Both cities' Industrial Pretreatment Programs are managed locally in compliance with the MWMC Model Ordinance, and are also included in the RWP budget. Page 1 FY 17-18 BUDGET AND CIP Metropolitan Wastewater Management Commission Budget Message Capital Budget- The capital program reflects a continued focus on design and construction of capital improvements planned to ensure that operation of the Regional Wastewater Facilities meets environmental regulations, and that adequate capacity will be provided to meet the needs of a growing service area. The Capital Budget for FY 18-19 is $34,100,000. Operating Budget- The FY 18-19 RWP Operating Budget for personnel services, materials and services and capital outlay expenses is $18,119,417, reflecting a 0.9% decrease when compared to the prior year adopted budget. The FY 18-19 budget includes Debt Service payments that total $5,452,810 as scheduled repayment of the $32.7 million for revenue bonds issued in May 2016, and $20.8 million in Clean Water SRF loans to fund the Facilities Plan capital improvements. Revenues - The RWP is 100% funded by user fees, from customers and industries receiving regional wastewater services. FY 18-19 user fee revenues (including septage service and SDC compliance charges) are projected at$33,750,000. This level of revenue is based on a recommended 2.5% increase in regional wastewater user fees to meet revenue objectives for planned capital improvements. Balanced Budget- The RWP achieves and maintains a structurally balanced budget with resources equal or greater than expenditures to set aside a portion of fund balance in reserves. In summary, the FY 18-19 budget implements the Commission's adopted Financial Plan policies, funding operations and administration sufficiently to maintain existing levels of service and to meet the environmental performance necessary for compliance with the National Pollutant Discharge Elimination System (NPDES) permit issued jointly to the MWMC and the two cities. Respectfully submitted, Tom Boyatt Interim MWMC Executive Officer Page 2 FY 17-18 BUDGET AND CIP Metropolitan Wastewater Management Commission Acronyms and Explanations ACRONYMS AND EXPLANATIONS AMCP—Asset Management Capital Program. The AMCP implements the projects and activities necessary to maintain functionality, lifespan, and effectiveness of the MWMC facility assets on an ongoing basis. The AMCP is administered by the City of Eugene for the MWMC. ARRA—American Reinvestment and Recovery Act. This funding was part of the federal government's economic stimulus program and issued loans under favorable conditions to stimulate infrastructure and capital project investment. BMF—Biosolids Management Facility. The Biosolids Management Facility is an important part of processing wastewater where biosolids generated from the treatment of wastewater are turned into nutrient rich,beneficial organic materials. CIP—Capital Improvements Program. This program implements projects outlined in the 2004 Facilities Plan and includes projects that improve performance, or expand treatment or hydraulic capacity of existing facilities. CMOM—Capacity Management and Maintenance Program. The CMOM program addresses wet weather issues such as inflow and infiltration with the goal to eliminate sanitary sewer overflows to the extent possible and safeguard the hydraulic capacity of the regional wastewater treatment facility. CWSRF—Clean Water State Revolving Fund. The Clean Water State Revolving Fund loan program is a federal program administered by the Oregon DEQ that provides low-cost loans for the planning, design and construction of various water pollution control activities. (DEQ) EMS—Environmental Management System. An EMS is a framework to determine the environmental impacts of an organization's business practices and develop strategies to address those impacts. ESD—Environmental Services Division. The ESD is a division of the City of Springfield's Development and Public Works Department that promotes and protects the community's health, safety, and welfare by providing professional leadership in the protection of the local environment, responsive customer service, and effective administration for the Regional Wastewater Program. IGA—Intergovernmental Agreement. Pursuant to ORS 190.010, ORS 190.080, and ORS 190.085, the IGA is an agreement between the cities of Eugene and Springfield and Lane County that created the MWMC as an entity with the authority to provide resources and support as defined in the IGA for the Regional Wastewater Program. Page 3 FY 18-19 BUDGET AND CIP Metropolitan Wastewater Management Commission Acronyms and Explanations MWMC—Metropolitan Wastewater Management Commission. The MWMC is the Commission responsible for the oversight of the Regional Wastewater Program. In this role, the MWMC protects the health and safety of our local environment by providing high-quality management of wastewater conveyance and treatment to the Eugene-Springfield community. The Commission is responsible for the oversight of the Regional Wastewater Program. NPDES—National Pollutant Discharge Elimination System permit. The NPDES permit program is administered by the Oregon Department of Environmental Quality (DEQ) in fulfillment of federal Clean Water Act requirements. The NPDES permit includes planning and technology requirements as well as numeric limits on effluent water quality. RWP—Regional Wastewater Program. Under the oversight of the MWMC, the purpose of the RWP is to protect public health and safety and the environment by providing high quality wastewater management services to the Eugene-Springfield metropolitan area. The MWMC and the regional partners are committed to providing these services in a manner that will achieve, sustain, and promote balance between community, environmental, and economic needs while meeting customer service expectations. SDC—System Development Charge. SDCs are charges imposed on development so that government may recover the capital needed to provide sufficient capacity in infrastructure systems to accommodate the development. SRF—Clean Water State Revolving Fund. The Clean Water State Revolving Fund loan program is a federal program administered by the Oregon DEQ that provides low-cost loans for the planning, design and construction of various water pollution control activities. (DEQ) SSO —Sanitary Sewer Overflows. Discharges of raw sewage. TMDL—Total Maximum Daily Load. The federal Clean Water Act defines Total Maximum Daily Load as the maximum amount of any pollutant that can be safely assimilated by a waterway in one day without significant degradation of water quality. TSS—Total Suspended Solids. Organic and inorganic materials that are suspended in water. WPCF—Regional Water Pollution Control Facility. The WPCF is a state-of-the-art facility providing treatment of the wastewater coming from the Eugene/Springfield metropolitan area. The WPCF is located on River Avenue in Eugene. The treatment plant and 49 pump stations distributed across Eugene and Springfield operate 24 hours a day, 7 days a week, 365 days a year to collect and treat wastewater from homes,businesses and industries before returning the cleaned water, or effluent, to the Willamette River. Through advanced technology and processes, the facility cleans, on average, up to 30 million gallons of wastewater every day. WWFMP—Wet Weather Flow Management Plan. This plan evaluated and determined the most cost-effective combination of collection system and treatment facility upgrades needed to manage excessive wet weather wastewater flows in the Eugene/Springfield metropolitan area. Page 4 FY 18-19 BUDGET AND CIP Metropolitan Wastewater Management Commission Overview REGIONAL WASTEWATER PROGRAM OVERVIEW The Metropolitan Wastewater Management Commission The Metropolitan Wastewater Management Commission (MWMC) was formed by Eugene, Springfield, and Lane County through an intergovernmental agreement(IGA) in 1977 to provide wastewater collection and treatment services for the Eugene-Springfield metropolitan area. The seven-member Commission is composed of members appointed by the City Councils of Eugene (3 representatives), Springfield (2 representatives) and the Lane County Board of Commissioners (2 representatives). Since its inception, the Commission, in accordance with the IGA, has been responsible for oversight of the Regional Wastewater Program (RWP) including: construction, maintenance, and operation of the regional sewerage facilities; adoption of financing plans; adoption of budgets, user fees and connection fees; adoption of minimum standards for industrial pretreatment and local sewage collection systems; and recommendations for the expansion of regional facilities to meet future community growth. Staffing and services have been provided in various ways over the 41 years of MWMC's existence. Since 1983, the Commission has contracted with the Cities of Springfield and Eugene for all staffing and services necessary to maintain and support the RWP. Lane County's partnership has involved participation on the Commission and support to the Lane County Metropolitan Wastewater Service District(CSD), which managed the proceeds and repayment of general obligation bonds issued to construct RWP facilities. Regional Wastewater Program Purpose and Key Outcomes The purpose of the RWP is to protect public health and safety and the environment by providing high quality wastewater management services to the Eugene-Springfield metropolitan area. The MWMC and the regional partners are committed to providing these services in a manner that will achieve, sustain, and promote balance between community, environmental, and economic needs while meeting customer service expectations. Since the mid-1990s, the Commission and RWP staff have worked together to identify key outcome areas within which to focus annual work plan and budget priorities. The FY 18-19 RWP work plans and budget reflect a focus on the following key outcomes or goals. In carrying out the daily activities of managing the regional wastewater system,we will strive to achieve and maintain: 1. High environmental standards; 2. Fiscal management that is effective and efficient; 3. A successful intergovernmental partnership; 4. Maximum reliability and useful life of regional assets and infrastructure; 5. Public awareness and understanding of MWMC, the regional wastewater system, and MWMC's objectives of maintaining water quality and a sustainable environment The Commission believes that these outcomes, if achieved in the long term, will demonstrate success of the RWP in carrying out its purpose. In order to help determine whether we are successful, indicators of performance and targets have been identified for each key outcome. Tracking performance relative to identified targets over time assists in managing the RWP to achieve desired results. The following indicators and performance targets provide an important framework for the development of the FY 18-19 RWP Operating Budget, Capital Improvements Program and associated work plans. Page 5 FY 18-19 BUDGET AND CIP Metropolitan Wastewater Management Commission Overview Outcome 1: Achieve and maintain high environmental standards. Indicators: Performance: FY 16-17 FY 17-18 FY 18-19 Actual Estimated Actual Target • Volume of wastewater 100%; 14.7 100%; 12.5 100%; 13 treated to water quality billion gallons billion gallons billion gallons standards • Average removal 97% 97% 95% efficiency of carbonaceous biochemical oxygen demand(CBOD) and total suspended solids (TSS)(permit limit 85%) • High quality biosolids Arsenic 29% Arsenic 20% Arsenic <50 (pollutant concentrations Cadmium 15% Cadmium 10% Cadmium<50 less than 50%of EPA Copper 40% Copper 35% Copper <50 land application limit) Lead 12% Lead 10% Lead <50 Mercury 12% Mercury 10% Mercury <50 Nickel 7% Nickel 15% Nickel <50 Selenium 18% Selenium 10% Selenium<50 Zinc 35% Zinc 15% Zinc <50 • ISO 14001 Environmental No major or minor No major or minor No major Management System nonconformance nonconformance nonconformance Certification(no major nonconformance) Outcome 2: Achieve and maintain fiscal management that is effective and efficient. Indicators: Performance: FY 16-17 FY 17-18 FY 18-19 Actual Estimated Actual Target • Annual budget and rates align with Policies met Policies met Policies met the MWMC Financial Plan • Annual audited financial statements Clean audit Clean audit Clean audit • Uninsured bond rating AA AA A • Reserves funded at target levels Yes Yes Yes • Financial Plan policy updates --- Partial plan Adopt and update implement • System Development Charges update --- Adopted and --- implemented Page 6 FY 18-19 BUDGET AND CIP Metropolitan Wastewater Management Commission Overview Outcome 3:Achieve and maintain a successful intergovernmental partnership. Indicators: Performance: FY 16-17 FY 17-18 FY 18-19 Actual Estimated Actual Target • Industrial Pretreatment Programs Consistent across Consistent across Consistent across are consistent with the MWMC service area service area service area pretreatment model ordinance • MWMC Facilities Plan projects 100%of initiated 100%of initiated 100%of initiated consistent with CIP budget and projects within projects within projects within schedule budget and 86% budget and 100% budget and 75% (6 of 7 projects) (6 of 6 projects) on schedule on schedule on schedule • MWMC IGA modification to --- Amendment of the --- allow acceptance of hauled waste IGA approved by from outside the service area the governing bodies • Capacity Management Implemented --- --- Operations and Maintenance Regional CMOM (CMOM)Program development Program annual reporting Outcome 4: Maximize reliability and useful life of regional assets and infrastructure. Indicators: Performance: FY 16-17 FY 17-18 FY 18-19 Actual Estimated Actual Target • Preventive maintenance completed 95% 95% 90% on time (best practices benchmark is 90%) • Preventive maintenance to corrective 4.7:1 5:1 5:1 maintenance ratio (benchmark 4:1- 6:1) • Emergency maintenance required 1% 1% <2% (best practices benchmark is less than 2%of labor hours) • Asset management(AM)processes Gap analysis Asset Draft asset and practices review and completed management management development workplan plan completed development Page 7 FY 18-19 BUDGET AND CIP Metropolitan Wastewater Management Commission Overview Outcome 5: Achieve and maintain public awareness and understanding of MWMC, the regional wastewater system, and MWMC's objectives of maintaining water quality and a sustainable environment. Indicators: Performance: FY 16-17 FY 17-18 FY 18-19 Actual Estimated Actual Target • Communications Plan Implemented high Update of plan Continue priority elements completed implementation and refresh as needed • Promote MWMC social Created new Created new Implement media channels YouTube channel Facebook and strategies to grow Twitter accounts Facebook followers to 300, and Twitter followers to 250 • Create and distribute 4 newsletters Update design and Distribute monthly MWMC e-newsletters increase distribution and increase by 10% distribution by 10% or greater • Pollution prevention 2 campaigns and 2 campaigns and 2 campaigns and campaigns 3 sponsorships; 3 sponsorships, 4 sponsorships; reaching 20% of reaching 20% of reaching 20% of residents in residents in residents in service area service area service area • Provide tours of the Provided tours for Provide tours for Provide tours for Water Pollution Control about 750 people greater than greater than Facility 750 people 750 people • Community survey Annual review of --- Plan for surveying data in 2019 • MWMC website New website Increased unique --- launched visitors by 15% Page 8 FY 18-19 BUDGET AND CIP Metropolitan Wastewater Management Commission Overview Roles and Responsibilities In order to effectively oversee and manage the RWP, the partner agencies provide all staffing and services to the MWMC. The following sections describe the roles and responsibilities of each of the partner agencies, and how intergovernmental coordination occurs on behalf of the Commission. City of Eugene The City of Eugene supports the RWP through representation on the MWMC,provision of operation and maintenance services, and active participation on interagency project teams and committees. Three of the seven MWMC members represent Eugene—two citizens and one City Councilor. Pursuant to the Intergovernmental Agreement(IGA), the Eugene Wastewater Division operates and maintains the Regional Water Pollution Control Facility (WPCF), the Biosolids Management Facility (BMF) and associated residuals and reclaimed water activities, along with regional wastewater pumping stations and transmission sewers. In support of the RWP, the Division also provides technical services for wastewater treatment; management of equipment replacement and infrastructure rehabilitation; biosolids treatment and recycling; industrial source control (in conjunction with Springfield staff); and regional laboratory services for wastewater and water quality analyses. These services are provided under contract with the MWMC through the regional funding of 78.36 full-time equivalent(FTE) employees. City of Sprin fg ield The City of Springfield supports the RWP through representation on the MWMC, provision of MWMC administration services, and active coordination of and participation on interagency project teams and committees. Two MWMC members represent Springfield—one citizen and one City Councilor. Pursuant to the IGA, the Springfield Development and Public Works Director, and the Environmental Services Manager serve as the MWMC Executive Officer and General Manager,respectively. The Environmental Services Division and Finance Department staff provide ongoing staff support to the Commission and administration of the RWP in the following areas: legal and risk management services; financial management and accounting; coordination and management of public policy; regulatory and permit compliance issues; coordination between the Commission and the governing bodies; long-range capital project planning, design, and construction management; coordination of public information, education, and citizen involvement programs; and coordination and development of regional budgets,rate proposals, and revenue projections. Springfield staff also provides local implementation of the Industrial Pretreatment Program, as well as billing coordination and customer service. These services are provided under contract with the MWMC through the regional funding of 14.68 FTE of Development and Public Works Department staff and 0.88 FTE of Finance Department staff, for a total 15.56 FTE as reflected in the FY 18-19 Budget. Lane County Lane County supports the RWP through representation on the MWMC, including two MWMC members that represent Lane County—one citizen and one County Commissioner. Lane County's partnership initailly included providing support to manage the proceeds and repayment of the RWP general obligation bonds to finance the local share of the RWP facilities construction. These bonds were paid in full in 2002. The County, while not presently providing sewerage, has the authority under its charter to do so. The Urban Growth Boundary includes the two Cities (urban lands) and certain unincorporated areas surrounding the Cities which lies Page 9 FY 18-19 BUDGET AND CIP Metropolitan Wastewater Management Commission Overview entirely within the County. Federal funding policy requires sewage treatment and disposal within the Urban Growth Boundary to be provided on a unified, metropolitan basis. Interagency Coordination The effectiveness of the MWMC and the RWP depends on extensive coordination, especially between Springfield and Eugene staff, who provide ongoing program support. This coordination occurs in several ways. The Springfield ESD/MWMC General Manager and the Eugene Wastewater Division Director coordinate regularly to ensure adequate communication and consistent implementation of policies and practices as appropriate. The Eugene and Springfield Industrial Pretreatment Program supervisors and staff meet regularly to ensure consistent implementation of the Model Industrial Pretreatment Ordinance. Additionally, interagency project teams provide input on and coordination of ongoing MWMC administration issues and ad hoc project needs. Exhibit 1 on the following page reflects the interagency coordination structure supporting the RWP. Special project teams are typically formed to manage large projects such as design and construction of new facilities. These interagency staff teams are formulated to provide appropriate expertise, operational knowledge, project management, and intergovernmental representation. Relationship to Eugene and Springfield Local Sewer Programs The RWP addresses only part of the overall wastewater collection and treatment facilities that serve the Eugene-Springfield metropolitan area. The Cities of Eugene and Springfield both maintain sewer programs that provide for construction and maintenance of local collection systems and pump stations, which discharge to the regional system. Sewer user fees collected by the two Cities include both local and RWP rate components. Page 10 FY 18-19 BUDGET AND CIP Metropolitan Wastewater Management Commission Overview EXHIBIT 1 REGIONAL WASTEWATER PROGRAM INTERAGENCY COORDINATION STRUCTURE EUGENE CITY COUNCIL LANE COUNTY SPRINGFIELD CITY COUNCIL COMMISSIONERS (METROPOLITAN WASTEWATER MANAGEMENT COMMISSION Operation&Maintenance Contract Administration Contract EUGENE SPRINGFIELD WASTEWATER DIVISION rEIRONMENTAL SERVICES DIVISION rR Facility Operation and Maintenance ning hab and Equipment Replacement tal Construction Technical Services s, Revenues Eugene Pretreatment Program it Coordination PumpStation and Interceptor Operations and agency Coordination Maintenance -Public Information/Education -Springfield Pretreatment Program -Legal and Risk Services PUBLIC WORKS ADMINISTRATION -Billing and Customer Service Billing and Customer Service FINANCE DEPARTMENT MAINTENANCE DIVISION -Accounting and Financial Reporting Regional Sewer Line Support INTERAGENCY COORDINATION AND PROJECT TEAMS Administrative Policy Decisions and Coordination Operational Policy Decisions and Coordination Capital Project Planning and Coordination Design Standards Development Capital Construction Guidance KEY OUTCOMES ACHIEVED i Page 11 FY 18-19 BUDGET AND CIP Metropolitan Wastewater Management Commission Budget and Program Summary REGIONAL WASTEWATER PROGRAM FY 18-19 BUDGET The MWMC's RWP Operating Budget provides the Commission and governing bodies with an integrated view of the RWP elements. Exhibit 2 provides a summary of the overall Operating Budget. Separate Springfield and Eugene agency budgets and staffing also are presented within this budget document. Major program areas supported by Springfield and Eugene are described in the pages that follow and are summarized in Exhibit 3 on page 14. Finally, Exhibit 4 on page 15 combines revenues, expenditures, and reserves to illustrate how funding for all aspects of the RWP is provided. It should also be noted that the "Amended Budget FY 17-18" column in all budget tables represents the updated FY 17-18 RWP budget as of February 27, 2018, which reconciled actual beginning balances at July 1, 2017, and approved budget transfers and supplemental requests. EXHIBIT 2 REGIONAL OPERATING BUDGET SUMMARY: INCLUDING RESERVE CONTRIBUTIONS ADOPTED AMENDED PROPOSED BUDGET BUDGET BUDGET CHANGE(1) FY17-18 FY17-18 FY18-19 INCR/(DECR) Full-Time Equivalent Staffing Level 92.96 93.92 93.92 0.96 1.0% Personnel Services (2) $10,796,927 $10,796,927 $11,103,999 $307,072 2.8% Materials& Services (2) 7,383,413 7,412,933 6,851,712 (531,701) -7.2% Captial Outlay (2,3) 107,860 218,263 163,706 55,846 51.8% Equip Replacement Contributions (4) 850,000 250,000 1,000,000 150,000 17.6% Capital Contributions(5) 14,000,000 11,300,000 14,000,000 - 0.0% Debt Service Contributions (6) 5,458,032 5,504,462 5,452,810 (5,222) -0.1% Working Captial Reserve(7) 900,000 900,000 900,000 - 0% Rate Stability Reserve(9) 2,000,000 2,000,000 2,000,000 0 0% Insurance Reserve(9) 515,000 515,000 515,000 - 0% Operating Reserve(10) 3,582,359 4,951,685 a 3,876,913 294,554 8.2% Rate Stabilization Reserve (11) 2,000,000 2,000,000 2,000,000 0 0% SRF Loan Reserve (12) 670,908 670,908 670,908 0 0% Budget Summary $48,264,499 $46,520,178 $48,535,048 $270,549 0.6% Notes: 1. The Change column and Percent Change column compare the adopted FY 18-19 Budget with the originally Adopted FY 17-18 Budget column. 2. Personnel Services,Materials and Services, and Capital Outlay budget amounts represent combined Springfield and Eugene Operating Budgets that support the RWP. 3. Capital Outlay does not include CIP,Equipment Replacement,Major Capital Outlay,or Major Rehabilitation,which are capital programs. 4. The Equipment Replacement Contribution is a budgeted transfer of operating revenues to "sinking funds"(reserves)for scheduled future replacement of major equipment,vehicles,and computers. See table on page 21 for year-end balance. Page 12 FY 18-19 BUDGET AND CIP Metropolitan Wastewater Management Commission Budget and Program Summary 5. The Capital Reserve Contribution is a budgeted transfer of operating revenues to"sinking funds" (reserves). Capital is passed through the Springfield Administration Budget. See table on page 22 for year-end balance. 6. The Debt Service line item is the sum of annual interest and principal payments on the Revenue Bonds and Clean Water State Revolving Fund(SRF) loans made from the Operating Budget (derived from user rates). The total amount of Debt Service budgeted in FY 18-19 is $5,452,810 the balance of which is budgeted from SDCs. 7. The Working Capital Reserve acts as a revolving account which is drawn down and replenished on a monthly basis to fund Eugene's and Springfield's cash flow needs. 8. The Rate Stability Reserve is used to set aside revenues available at year-end after the budgeted Operating Reserve target is met. Internal policy has established a level of$2 million for the Rate Stability Reserve. See Exhibit 5 on page 20 for year-end balance. 9. The Insurance Reserve was established to set aside funds equivalent to the insurance deductible amount for property and liability insurance coverage,for losses per occurrence. 10. The Operating Reserve is used to account for the accumulated operating revenues net of operations expenditures. The Commission's adopted policy provides minimum guidelines to establish the Operating Reserve balance at approximately 10%of the adopted Operating Budget. The Operating Reserve provides for contingency funds in the event that unanticipated expenses or revenue shortfalls occur during the budget year. 11. The Rate Stabilization Reserve was established at$2 million as a result of the 2006 MWMC Revenue Bond Declaration and Covenants. It holds funds that are available if needed,to ensure Debt Service payments can be made. 12. The Clean Water SRF loan reserve is budgeted as required per loan agreements. Page 13 FY 18-19 BUDGET AND CIP Metropolitan Wastewater Management Commission Budget and Program Summary EXHIBIT 3 REGIONAL WASTEWATER PROGRAM OPERATING BUDGET LINE ITEM SUMARY BY PROGRAM AREA ADOPTED AMENDED PROPOSED SPRINGFIELD ACTUALS BUDGET BUDGET BUDGET CIIANGE MWMC ADMINISTRATION FY 16-17 FY 17-18 FY 17-18 FY 18-19 INCR/(DECR) Personnel Services $1,245,301 $1,363,133 $1,363,133 $1,431,501 $68,368 5.0% Materials&Services 1,539,083 1,982,934 1,982,934 1,907,578 (75,356) -3.8% Capital Outlay - - - - TOTAL $2,784,384 $393469067 $3,346,067 $393399079 ($69988) 0% INDUSTRIAL PRETREATMENT Personnel Services $310,868 $331,790 $331,790 $351,786 $19,996 6.0% Materials&Services 104,647 118,969 118,969 122,869 3,900 3.3% Capital Outlay - - - - - -- TOTAL $4159515 $450,759 $450,759 $4749655 $23,896 5.3% ACCOUNTING Personnel Services $98,174 $109,819 $109,819 $116,034 $6,215 5.7% Materials&Services 24,292 35,255 35,255 39,898 4,643 13.2% Capital Outlay - - - - -- TOTAL $122,466 $1459074 $1459074 $1559932 $109858 7.5% TOTAL SPRINGFIELD Personnel Services $1,654,343 $1,804,742 $1,804,742 $1,899,321 $94,579 5.2% Materials&Services 1,668,022 2,137,158 2,137,158 2,070,345 (66,813) -3.1% Capital Outlay - - - - - -- TOTAL $3,322,365 $3,941,900 $399419900 $3,9699666 $279766 0.7% EUGENE ADMINISTRATIVE SERVICES Personnel Services $1,528,307 $1,898,397 $1,898,397 $1,761,718 ($136,679) -7.2% Materials&Services 489,610 799,774 829,539 683,318 (116,455)-14.6% Capital Outlay 5,589 - - - TOTAL $2,023,505 $29698,171 $2,7279936 $2,4459036 ($2539134) -9.4% BIOSOLIDS MANAGEMENT Personnel Services $1,108,752 $1,349,421 $1,349,421 $1,381,950 $32,529 2.4% Materials&Services 720,470 970,717 858,577 909,816 (60,902) -6.3% Capital Outlay - - 110,403 - TOTAL $1,829,222 $2,320,138 $2,318,401 $292919766 ($28,373) -1.2% INDUSTRIAL SOURCE CONTROL Personnel Services $571,102 $602,027 $602,027 $624,405 $22,378 3.7% Materials&Services 135,597 131,681 131,131 120,132 (11,549) -8.8% Capital Outlay - - - - - -- TOTAL $7069699 $733,708 $7339157 $744,537 $109829 1.5% TREATMENT PLANT Personnel Services $4,682,420 $4,751,387 $4,751,387 $4,994,444 $243,057 5.1% Materials&Services 2,746,606 3,004,047 2,998,161 2,736,780 (267,267) -8.9% Capital Outlay 13 107,860 107,860 163,706 55,846 51.8% TOTAL $7,4299039 $7,8639294 $798579408 $7,8949930 $319636 0.4% REGIONAL PUMP STATIONS Personnel Services $90,040 $202,247 $202,247 $173,580 ($28,667) -14.2% Materials&Services 267,510 289,241 288,873 286,428 (2,813) -1.0% Capital Outlay 42,890 . - - - TOTAL $4009440 $491,488 $4919120 $460,008 ($31,480) -6.4% BENEFICIAL REUSE SITE Personnel Services $130,934 $188,706 $188,706 $268,581 $79,875 42.3% Materials&Services 42,170 50,794 169,492 44,893 (5,901)-11.6% Capital Outlay - - - - - -- TOTAL $1739104 $239,500 $358,198 $3139474 $73,974 30.9% TOTAL EUGENE Personnel Services $8,111,555 $8,992,185 $8,992,185 $9,204,678 $212,493 2.4% Materials&Services 4,401,962 5,246,255 5,275,774 4,781,367 (464,888) -8.9% Capital Outlay 48,492 107,860 218,263 163,706 55,846 51.8% TOTAL $ 1295629009 d $1493469300 $14,486,222 $14,149,751 ($196,549) -1.4% TOTAL REGIONAL BUDGET $ 15,8849374 $189288,200 $18,4289122 $18,1199417 ($168,783) -0.9% NOTE:Does not include Major Rehab,Equipment Replacment or Major Capital Outlay Page 14 FY 18-19 BUDGET AND CIP Metropolitan Wastewater Management Commission Budget and Program Summary EXHIBIT 4 REGIONAL WASTEWATER PROGRAM BUDGET SUMMARY AND COMPARISON ADOPTED AMENDED PROPOSED BUDGET BUDGET BUDGET CHANGE* OPERATING BUDGET FY 17-18 FY 17-18 FY 18-19 INC(DECR) Administration $3,941,900 $3,941,900 $3,969,666 $27,766 Operations 14,346,300 14,486,222 14,149,751 (196,549) Capital Conribution& Transfers F 14,000,000 11,300,000 14,000,000 0 Equip Repl- Contribution 850,000 250,000 1,000,000 150,000 Operating&Revenue Bond Reserve 9,668,267 11,037,593 9,962,821 294,554 Debt Service 5,458,032 5,504,462 5,452,810 (5,222) Total Operating Budget $48,264,499 $46,520,177 $48,535,048 $270,549 Fes: Beginning Balance $12,603,539 $14,112,787 $11,581,093 ($1,022,446) User Fees 32,475,000 32,475,000 33,745,000 1,270,000 SDC's for Mechant Fees F 4,000 4,000 4,000 Other 3,181,960 3,181,960 3,244,955 62,995 Total Operating Budeget Funding $48,264,499 $49,773,747 $48,575,048 $310,549 CAPITAL PROGRAM BUDGET Increase Digestion Capacity $13,534,000 $12,893,205 $2,500,000 ($11,034,000) Operation Building Improvements 12,520,000 17,062,947 lim 8,900,000 (3,620,000) Electrical Distribution System 5,875,000 5,923,487 4,600,000 (1,275,000) Thermal Load Implementation 1 1,030,000 400,000 0 NA Poplar Harvest Mgmt Services 330,000 515,000 160,000 (170,000) Thermal Load Pre-Implementation 180,000 161,759 200,000 20,000 WPCF Lagoon Remove/Decommission 92,000 111,546 5,550,000 5,458,000 Facility Plan Enginering Services 80,000 78,949 85,000 5,000 RNG Upgrade Facilties 0 470,000 7,050,000 NA Glenwood Pump Station F 0 0 1,250,000 NA Resiliency Planning 0 500,000 375,000 NA Class A Disinfection Facilities 0 0 750,000 NA Recycled Water Demonstration Project 0 0 300,000 NA Riparian Shade Credit Program 0 0 226,000 NA Comprehensive Facility Plan Update F 0 0 130,000 NA Asset Management: Equipment Replacement Purchases 715,000 715,000 649,000 (66,000) Major Rehab ~ 566,000 566,000 1,175,000 609,000 Major Capital Outlay 622,000 1,444,145 200,000 (422,000) Total Capital Projects $35,544,000 $40,842,038 $34,100,000 ($1,444,000) Funding: Equipment Replacement $715,000 $715,000 $649,000 ($66,000) Capital Fund 9,132,069 8,354,220 0 NA Capital Reserve 25,696,931 31,772,818 33,451,000 7,754,069 Total Capital Projects Funding $35,544,000 $40,842,038 $34,100,000 ($1,444,000) Note: *The Change(Increase/Decrease)column compares the adopted FY 18-19 budget to the originally adopted FY 17-18 budget column. Page 15 FY 18-19 BUDGET AND CIP Metropolitan Wastewater Management Commission Budget and Program Summary BUDGET AND RATE HISTORY The graphs on pages 17 and 18 show the regional residential wastewater service costs over a 5- year period, and a 5-year Regional Operating Budget Comparison. Because the Equipment Replacement,Major Infrastructure Rehabilitation and Major Capital Outlay programs are managed in the Eugene Operating Budget, based on the size, type and budget amount of the project these programs are incorporated into either the 5-year Regional Operating Budget Comparison graph or the 5-Year Capital Programs graph on page 18. The Regional Wastewater Capital Improvement Programs graph on page 18 shows the expenditures over the recent five years in the MWMC's Capital Program and including Asset Management projects. A list of capital projects is located in Exhibit 13 on page 44. As shown on the Regional Residential Sanitary Sewer Rate graph on page 17, regional sewer user charges have incrementally increased to meet the revenue requirements necessary to fund facility improvements as indentified in the 2004 MWMC Facilities Plan. This Plan demonstrated the need for a significant capital investment in new and expanded facilities to meet environmental performance requirements and capacity to serve the community through 2025. Although a portion of these capital improvements can be funded through system development charges (SDCs), much of the funding for approximately $196 million (in 2006 dollars) in capital improvements over the 20-year period will come from user charges. Since 2004, this has become the major driver of the MWMC's need to increase sewer user rates on an annual basis. In FY 08-09, there was an 11% user rate increase over FY 07-08 rates applied uniformly across all user classes. This rate increase provided adequate revenue to meet current bond covenants and meet requirements to issue $50.7 million in bonds in FY 08-09. Additionally, in October of 2008, the Commission adopted an interim user rate increase of 7% due to the closure of Hynix Semiconductor. This increase was necessary to issue new revenue bonds and maintain bond covenants for existing bonds. The typical residential monthly wastewater bill increased an additional $1.10 per month and went into effect on December 1, 2008. In FY 09-10, there was an 18% user rate increase over FY 08-09 rates applied uniformly across all user classes. This rate provided for Operations, Administration, Capital programs, reserves and debt service to be funded at sufficient levels to meet FY 09-10 requirements. In FY10-11 user rates increased 5% over the prior year rates, and in FY 11-12 and FY 12-13 user rates increased 4% each year, over the prior year rates to provide for Operations, Administration, Capital programs,reserves, debt service, and debt coverage requirements. In FY 13-14 user rates increased 3% over the prior year rates, in FY14-15 user rates increased by 3.5% and in FY 15-16 user rates increased by 2% over the prior year rates to provide for Operations, Administration, Capital programs,reserves, debt service, and debt coverage requirements. The FY 18-19 Budget is based on a 2.5%user rate increase over the FY 17-18 rates. This increase will provide for Operations, Administration, Capital programs, reserves and debt service, continuing to meet capital and operating requirements and supporting the Commission's Financial Plan policies, as well as financially positioning for future investments in capital assets. Page 16 FY 18-19 BUDGET AND CIP Metropolitan Wastewater Management Commission Budget and Program Summary The chart below displays the regional component of a residential monthly bill when applying the base and flow rates to 5,000 gallons of wastewater treated, which includes a $0.64 increase effective July 1, 2018. REGIONAL RESIDENTIAL SEWER RATES 5-YEAR COMPARISON ss.0a 30.00 25.00 m orn 20.00 z U a. r 15.00 c a $25.85 $26.49 $24,12 ',24.60 $25.09 10.00 5.00 0.00 FY 14-15 FY 1516 FY 165-17 FY 17-18 FY 18.19 The graph below displays the Regional Operating Budget amounts for the recent 5-year period. REGIONAL OPERATING BUDGET 5-YEAR COMPARISON ` $22,000,000 $20,000,000 $16,682,647 $17,349,472 $17,700,630 $18.288,200 $18,119,417 $18,000,000 $16,000;000 — $14,000,000 — $12,000,000 $10,000,000 $8,000,000 $6,000,000 — $4,000,000 $2,000,000 $0 FY 1415 FY 15-16 FY 1G-17 FY 17-18 - c-19 Page 17 FY 18-19 BUDGET AND CIP Metropolitan Wastewater Management Commission Budget and Program Summary The graph below displays the Regional Wastewater Capital Improvement Program Budget amounts for the recent 5-year period. REGIONAL WASTEWATER CAPITAL IMPROVEMENT PROGRAMS 5-YEAR COMPARISON $45,000;000 $40,000,000 $35,000,000 $36,941,600 $35,544,000 $34,100,000 $30,000,000 $26,000.000 $21,938,604 $20,000,000 $15,000,000 $14,939,647 $10,000,000 $5,000,000 FY 14-15 FY 15-16 FY 1&17 FY 17-18 FY 18-19 Page 18 FY 18-19 BUDGET AND CIP Metropolitan Wastewater Management Commission Reserves REGIONAL WASTEWATER PROGRAM RESERVES The RWP maintains reserve funds for the dedicated purpose to sustain stable rates while fully funding operating and capital needs. Commission policies and guidance, which direct the amount of reserves appropriated on an annual basis, are found in the 2005 MWMC Financial Plan. Further details on the FY 18-19 reserves are provided below. OPERATING RESERVES The MWMC Operating Budget includes six separate reserves: the Working Capital Reserve, Rate Stability Reserve, Rate Stabilization Reserve, State Revolving Fund(SRF) Reserve, Insurance Reserve and the Operating Reserve. Revenues are appropriated across the reserves in accordance with Commission policy and expenditure needs. Each reserve is explained in detail below_ WORKING CAPITAL RESERVE The Working Capital Reserve acts as a revolving account that is drawn down and replenished on a monthly basis to provide funds for payment of Springfield Administration and Eugene Operations costs prior to the receipt of user fees from the Springfield Utility Board and Eugene Water and Electric Board. The Working Capital Reserve is set at$900,000 for FY 18-19, $200,000 of which is dedicated to Administration and$700,000 is dedicated to Operations. RATE STABILITY RESERVE The Rate Stability Reserve was established to implement the Commission's objective of maintaining stable rates. It is intended to hold revenues in excess of the current year's operating and capital requirements for use in future years, in order to avoid potential rate spikes. The amount budgeted on an annual basis has been set at $2 million, with any additional net revenues being transferred to the capital reserve for future projects. RATE STABILIZATION RESERVE The Rate Stabilization Reserve contains funds to be used at any point in the future when net revenues are insufficient to meet the bond covenant coverage requirement. The Commission shall maintain the Rate Stabilization account as long as bonds are outstanding. In FY 18-19 no additional contribution to this reserve is budgeted and the balance at June 30, 2019,will remain at $2 million. CLEAN WATER STATE REVOVLING FUND (SRF) RESERVE The Clean Water SRF Reserve was established to meet revenue coverage requirements for SRF loans. The SRF Reserve is set at$670,908 for FY 18-19. Page 19 FY 18-19 BUDGET AND CIP Metropolitan Wastewater Management Commission Reserves INSURANCE RESERVE The Insurance Reserve was established to set aside funds equivalent to the insurance deductible amount for property and liability insurance coverage, for losses per occurrence. The Insurance Reserve is set at$515,000 for FY 18-19. OPERATING RESERVE The Operating Reserve is used to account for accumulated operating revenues net of operating expenditures (including other reserves). The Commission's adopted policy provides minimum guidelines to establish the Operating Reserve at approximately 10% of the adopted operating budget. For FY 18-19, the Operating Reserve is budgeted at$3,916,913, which includes the 10% of total Personnel Services,Materials and Services, and Capital Outlay in accordance with Commission policy. EXHIBIT 5 ADOPTED AMENDED PROPOSED BUDGET BUDGET BUDGET OPERATING RESERVES FY 17-18 FY 17-18 FY 18-19 Beginning Balance $12,603,539 $14,112,787 $11,581,093 User Fee Revenue 32,000,000 32,000,000 33,260,000 Septage Revenue 475,000 475,000 485,000 Other Revenue 1,060,610 1,060,610 1,072,110 Interest 100,000 100,000 150,000 Transfer from Improvements SDCs 2,000,000 2,000,000 2,000,000 Transfer from Reimbursement SDCs 21,350 21,350 22,845 Personnel Services (10,796,927) (10,796,927) (11,103,999) Materials&Services (7,379,413) (7,408,932) (6,847,712) Capital Outlay (107,860) (218,263) (163,706) Interfund Transfers (14,850,000) (14,850,000) (15,000,000) Debt Service-SRF Loan (1,450,180) (1,450,180) (1,446,158) Debt Service-2016 Revenue Bond (4,007,852) (4,007,852) (4,006,652) Working Capital (900,000) (900,000) (900,000) Insurance Reserve (515,000) (515,000) (515,000) SRF Loan Reserve (670,908) (670,908) (670,908) Rate Stability Reserve (2,000,000) (2,000,000) (2,000,000) Rate Stabilization Reserve 2,0001000 2,000,000 2,000,000 Operating Reserve $3,582,359 $4,951,687 $3,916,913 Page 20 FY 18-19 BUDGET AND CIP Metropolitan Wastewater Management Commission Reserves CAPITAL RESERVES The MWMC Capital Budget includes four reserves: the Equipment Replacement Reserve, SDC Reimbursement Reserves, SDC Improvement Reserves, and the Capital Reserve. These reserves accumulate revenue to help fund capital projects including equipment replacement and major rehabilitation. They are funded by annual contributions from user rates, SDCs, and SRF loans. Each reserve is explained in detail below. EQUIPMENT REPLACEMENT RESERVE The Equipment Replacement Reserve accumulates replacement funding for three types of equipment: 1)major/stationary equipment items costing less than$200,000 with useful lives of 20 years or less; 2) fleet vehicles maintained by the Eugene Wastewater Division; and 3) computer servers that serve the Eugene Wastewater Division. Contributions to the Equipment Replacement Reserve in the FY 18-19 budget total $850,000, additional budget details are provided below. The Equipment Replacement Reserve is intended to accumulate funds necessary to provide for the timely replacement or rehabilitation of equipment, and may also be borrowed against to provide short-term financing of capital improvements. An annual analysis is performed on the Equipment Replacement Reserve. The annual contribution is set so that all projected replacements will be funded over a 20-year period and at the end of the 20-year period, the reserve will contain replacement funds for all equipment projected to be in use at that time. Estimates used in the analysis include interest earnings, inflation rates and useful lives for the equipment. ADOPTED AMENDED PROPOSED BUDGET BUDGET BUDGET EQUIPMENT REPLACEMENT RESERVE FY 17-18 FY 17-18 FY 18-19 Beginning Balance $11,737,145 $11,822,589 $12,157,589 Annual Equipment Contribution 850,000 850,000 850,000 Interest 50,000 50,000 30,000 Equipment Purchases 715,000 715,000 649,000 ui ment Replacement Reserve 1 $11,922,145 1 $12,007,589 $12 388,589 SYSTEM DEVELOPMENT CHARGE (SDC) RESERVES SDCs are required as part of the MWMC IGA. They are connection fees charged to new users to recover the costs related to system capacity, and are limited to funding Capital Programs. The purpose of the SDC Reserves is to collect and account for SDC revenues separately from other revenue sources, in accordance with Oregon statutes. The Commission's SDC structure includes a combination of"Reimbursement" and"Improvement" fee components. Estimated SDC revenues for FY 18-19 are approximately $1.6 million. Budgeted expenditures include $2 million from Improvement Fees to fund portions of the annual debt service payments on the 2016 revenue bonds. The projected beginning SDC Reserve balance on July 1, 2018 is $4,618,482. Page 21 FY 18-19 BUDGET AND CIP Metropolitan Wastewater Management Commission Reserves ADOPTED AMENDED PROPOSED BUDGET BUDGET BUDGET REIMBURSEMENT SDC RESERVE FY 17-18 FY 17-18 FY 18-19 Beginning Balance $844,764 $881,718 $998,019 Reimbursement SDCs Collected 130,000 130,000 135,000 Interest 1,200 1,200 2,000 SDC Compliance Charge 7,000 7,000 9,000 Xfr to Debt Service(Fund 612) (21,350) (21,350) (22,845) Materials& Services 2,000 2,000 2,000 Reimbursement SDC Reserve $959,614 $996,568 $1,119,174 ADOPTED AMENDED PROPOSED BUDGET BUDGET BUDGET IMPROVEMENT SDC RESERVE FY 17-18 FY 17-18 FY 18-19 Beginning Balance $3,283,268 $3,807,464 $3,620,463 Improvement SDCs Collected 1,300,000 1,300,000 1,600,000 Interest 7,000 7,000 9,000 Materials&Services (2,000) (2,000) (2,000) Xfr to Debt Service Fund 612 2,000,000 2,000,000 2,000,000 Improvement SDC Reserve $2,588,268 1 $3,112,464 $3,227,463 CAPITAL RESERVE The Capital Reserve accumulates funds transferred from the Operating Reserve for the purpose of funding the CIP, Major Capital Outlay and Major Rehabilitation Program costs. The intent is to collect sufficient funds over time to construct a portion of planned capital projects with cash in an appropriate balance with projects that are funded with debt financing. The FY 18-19 Budget includes a contribution from the Operating Reserve of$14 million. The beginning balance on July 1, 2018, is projected to be $50,891,590. Additional budget detail on the CIP, Major Capital Outlay and Major Rehabilitation Program reserves is provided below. ADOPTED AMENDED PROPOSED BUDGET BUDGET BUDGET CAPITAL RESERVES FY 17-18 FY 17-18 FY 18-19 Beginning Balance $57,862,221 $58,008,648 $50,891,590 Transfer from Operating Reserve 14,000,000 14,000,000 14,000,000 Interest 150,000 150,000 530,000 Interest Income(Revenue Bond Proceeds) 150,000 150,000 5,000 Other Income 250 250 0 Funding For Capital Improvement Projects (33,641,000) (34,136,893) (30,826,000) Funding For Major Rehabilitation (566,000) (566,000) (1,175,000) Funding For Major Capital Outlay 622,000 144,145 200,000 Capital Reserve $37,333,471 $37,461,860 $33,225,590 Page 22 FY 18-19 BUDGET AND CIP Metropolitan Wastewater Management Commission Staflmg EXHIBIT 6 REGIONAL WASTEWATER PROGRAMS* ORGANIZATION CHART FY 18-19 Metropolitan Wastewater Management Commission CITY OF SPRINGFIELD" CITY OF EUGENE** Environmental Services Division Wastewater Division &Finance Department 78.36 FTE 15.56 FTE Division Director .85 FTE MWMC Executive Officer .08 FTE Operations Manager .93 FTE MWMC General Manager 75 FTE Support Services Wastewater Biosolids Beneficial Reuse Regional Pump Industrial Treatment Plant Management Site Stations Pretreatment 15.32 FTE. 40.11 FTE 12.67 FTE 1.82 FTE 1.31 FTE 5.35 FTEAccountln MWMC Industrial 9 Administration Pretreatment .88 FTE 10.60 FTE 325 FTE Admin SupportEquipment Regulations& Operations Operations Operations 5.36 FTE Maintenance Enforcement Administration AVnnistraion 16.0 FTE 6.97 FTE .53 FTE .85 FTE 3.38 FTE Support Computer .60 FTE Services Equipment Equipment Equipment Laborator Regula 2.73 FTE Maintenance Maintenance Maintenance Facility y Budget& Maintenance 1.27 FTE Financial & 10.3 FTE 2.57 FTE .59 FTE Management Enforcement Stores .46 FTE 1.15 FTE 2.95 FTE 2.67 FTE Facility Facility Facility Maintenance Maintenance Maintenance Sampling Propertyt Env Data .70 FTE 9.32 FTE 2.03 FTE .39 FTE. Risk Mgmt Analyst .20 FTE .65 FTE Laboratory Laboratory Laboratory Special Safety,Env& 2.65 FTE .66 FTE .15 FTE Proj." Health Planning Supervisor 1.75 FTE .89 FTE Sampling Sampling Sampling Customer .74 FTE .44 FTE. .16 FTE Service Management .50 FTE Analyst .89 FTE pW Maint Public 1.10 FTE Education Project Mgr. 1.0 FTE 93 FTE Construction User Fee Management Support 5.40 FTE 1.0 FTE PW Financial Services .20 FTE Notes: * Full-Time Equivalent(FTE)figures represent portions of Eugene and Springfield staff funded by regional wastewater funds. ** The chart represents groups of staff dedicated to program areas rather than specific positions. Page 23 FY 18-19 BUDGET AND CIP Metropolitan Wastewater Management Commission Staffing EXHIBIT 7 REGIONAL WASTEWATER PROGRAM POSITION SUMMARY BUDGET BUDGET BUDGET FTE CLASSIFICATION FY 16-17 FY 17-18 FY 18-19 CHANGE SPRINGFIELD ENVIRONMENTAL SERVICES & FINANCE Accountant 0.80 0.80 0.80 - Accounting Supervisor 0.08 0.08 0.08 - Administrative Specialist 1.85 2.00 2.00 - Assistant Project Coordinator 0.90 0.90 0.90 - Civil Engineer/Design&Construction Coordinator 3.00 3.00 3.00 - Development and Public Works Director 0.08 0.08 0.08 - Engineering Assistant 0.80 0.65 0.65 - Environmental Management Analyst 0.65 0.75 0.75 - Environmental Services Program Manager 0.80 0.80 0.80 - Environmental Services Supervisor 0.95 0.95 0.95 - Environmental Services Technician 2.00 2.00 2.00 - ESD Manager/MWMC General Manager 0.80 0.80 0.80 - Managing Civil Engineer 1.75 1.75 1.75 - Public Information& Education Analyst 1.00 1.00 1.00 - TOTAL SPRINGFIELD 15.46 15.56 15.56 0.00 Page 24 FY 18-19 BUDGET AND CIP Metropolitan Wastewater Management Commission Staffmg EXHIBIT 7 (Continued) REGIONAL WASTEWATER PROGRAM POSITION SUMMARY BUDGET BUDGET BUDGET FTE CLASSIFICATION FY 16-17 FY 17-18 FY 18-19 CHANGE EUGENE WASTEWATER DIVISION & OTHER PW Administrative Specialist 1.78 1.78 1.78 - Administrative Specialist, Sr 0.95 0.95 0.95 - Applicantion Support Technician 0.95 0.95 0.95 - Application Systems Analyst 1.78 1.78 1.78 - Custodian 1.00 1.00 1.00 - Finance &Admin Manager 0.89 0.89 0.89 - Electrician 1 3.28 3.28 3.28 - Engineering Associate 0.35 0.35 0.35 - Maintenance Worker 12.29 12.29 13.25 0.96 Management Analyst 4.25 5.14 5.14 - Office Supervisor, Sr 0.89 0.00 0.00 - Parts and Supply Specialist 1.78 1.78 1.78 - PW Financial Services Manager 0.20 0.20 0.20 - Utility Billing Coordinator 1.00 1.00 1.00 - Wastewater Lab Assistant 0.82 0.82 0.82 - Wastewater Division Director 0.85 0.85 0.85 - Wastewater Instrument Electrician 1.00 1.00 1.00 - Wastewater Plan Operations Manager 0.93 0.93 0.93 - Wastewtaer Operations Supervisor 2.00 2.00 2.00 - Wastewater Plan Maintenance Supervisor 2.88 2.88 2.88 - Wastewater Pretreatment&Lab Supervisor 0.82 0.82 0.82 - Wastewater Technician 36.71 36.71 36.71 - TOTAL EUGENE 77.40 77.40 78.36 0.96 GRAND TOTAL 92.86 92.96 93.92 0.96 Page 25 FY 18-19 BUDGET AND CIP Metropolitan Wastewater Management Commission Springfield Budget Detail CITY OF SPRINGFIELD REGIONAL WASTEWATER PROGRAM RESPONSIBILITIES The City of Springfield manages administration services for the RWP under the Intergovernmental Program Responsibilities ■ Administration&Management Agreement for the Metropolitan Wastewater . Financial Planning&Management Management Commission (MWMC). The programs ■ Long-Range Capital Project Planning maintained by Springfield to support the RWP are ■ Project and Construction Management ■ Coordination between the Commission and summarized below and are followed by Springfield's governing bodies regional wastewater budget summaries. Activities, and ■ Coordination and Management of: therefore program budgets, for the MWMC Risk Management&Legal Services Public Policy Issues administration vary from year to year depending upon Regulatory and Permit Compliance Issues the major construction projects and special initiatives ■ Public Information,Education and outreach underway. A list of the capital projects Springfield ■ Industrial Pretreatment source Control staff will support in FY 18-19 is provided in Exhibit 12 ■ Customer Service on page 41. MWMC ADMINISTRATION The Springfield Environmental Services Division (ESD) and Finance Department provide ongoing support and management services for the MWMC. The Development and Public Works (DPW) Director serves as the MWMC Executive Officer. The Environmental Services Manager serves as the General Manager. Springfield provides the following administration functions: financial planning management, accounting and financial reporting; risk management and legal services; coordination and management of public policy; coordination and management of regulatory and permit compliance issues; coordination between the Commission and the governing bodies; long-range capital project planning and construction management; coordination of public information, education, and citizen involvement programs; sewer user customer service; and coordination and development of regional budgets, rate proposals, and revenue projections. INDUSTRIAL PRETREATMENT (SOURCE CONTROL) PROGRAM The Industrial Pretreatment Program is a regional activity implemented jointly by the Cities of Eugene and Springfield. The Industrial Pretreatment section of the ESD is charged with administering the program for the regulation and oversight of wastewater discharged to the sanitary collection system by industries in Springfield. This section is responsible for ensuring that these wastes do not damage the collection system, interfere with wastewater treatment processes,result in the pass-through of harmful pollutants to treated effluent or biosolids, or threaten worker health or safety. This responsibility is fulfilled, in part, by the use of a permit system for industrial dischargers. This permit system, common to both Eugene and Springfield, implements necessary limitations on waste characteristics and establishes inspection, monitoring, and reporting requirements for documenting waste quality and quantity controls. The Industrial Pretreatment section is also responsible for locating new industrial discharges in Springfield and evaluating the impact of those discharges on the regional WPCF. The Industrial Pretreatment Program also addresses Page 26 FY 18-19 BUDGET AND CIP Metropolitan Wastewater Management Commission Springfield Budget Detail the wastewater discharges of some commercial/industrial businesses through the development and implementation of Pollution Management Practices. Pretreatment program staff also coordinates pollution prevention activities in cooperation with the Pollution Prevention Coalition of Lane County. ACCOUNTING AND FINANCIAL REPORTING Accounting and financial reporting services for the RWP are provided by the Accounting section in the Springfield Finance Department, in coordination with ESD. Springfield Accounting staff maintains grant and contract accounting systems, as well as compliance with all local, state and federal accounting and reporting requirements for MWMC finances. This section also assists ESD with preparation of the MWMC budget, capital financing documents, sewer user rates, and financial policies and procedures. PROGRAMS AND SIGNIFICANT SERVICE/EXPENDITURE CHANGES In FY 18-19, the City of Springfield will support the following major regional initiatives in addition to ongoing Commission administration and industrial pretreatment activities: ■ Continue public information, education and outreach activities focused on the MWMC's Key Outcomes and Communication Plan objectives to increase awareness of the MWMC's ongoing efforts in maintaining water quality and a sustainable environment. ■ Implement Capital Financing strategies necessary to meet current debt obligations, prepare for additional debt financing, and ensure sufficient revenues in accordance with the 2005 MWMC Financial Plan. ■ Continue implementation of the 2004 MWMC Facilities Plan and 2014 Partial Facilities Plan Update to meet all regulatory requirements and capacity needs. Considering emerging environmental regulations that may impact the operation of the WPCF. ■ Protect the Regional Wastewater Program (RWP) interests through participation in Association of Clean Water Agencies activities. ■ Coordinate temperature Total Maximum Daily Load (TMDL) compliance through continued development and implementation of the thermal load mitigation strategy, including but not limited to a recycled water program. ■ Continue participation with the Association of Clean Water Agencies and the Department of Environmental Quality on regulatory permitting strategies and the development of water quality trading rules. ■ Implement resiliency planning to ensure protection of public health and safety following natural disasters such as earthquakes and floods. Page 27 FY 18-19 BUDGET AND CIP Metropolitan Wastewater Management Commission Springfield Budget Detail SIGNIFICANT BUDGET CHANGES FOR FY 18-19 The budget for Springfield Personnel Services,Materials and Services, and Capital Outlay for FY 18-19 totals $3,969,666 representing an overall increase of$27,766 or 0.7%from the adopted FY 17-18 budget, as displayed in Exhibit 8 on page 29. Personnel Services Personnel Services totaling $1,899,321 represents a FY 18-19 increase of$94,579 or 5.2% above the originally adopted FY 17-18 budget. The major changes are summarized below: Staffing—15.56 Full-Time Equivalent(FTE) staff remains level Staffing remains level in the FY 18-19 budget when compared to FY 17-18. Regular Wages and Overtime- $1,259,438, an increase of$75,480 or 6.4% Salaries are based upon the negotiated management/labor contracts as approved by the Springfield City Council, and staffing levels. Employee Benefits-$326,284,an increase of$18,204 or 5.9% The employee benefits consist mainly of PERS/OPSRP retirement system costs, FICA and Medicare contributions. Health Insurance - $313,599, an increase of$895 or 0.3% The health insurance cost remain close to level,with no charge health related services available via the Springfield Wellness Center located in City Hall. Materials and Services The Materials and Services budget total is $2,070,345 in FY 18-19,representing a net decrease of$66,813 or 3.1%below the adopted FY 17-18 budget. The major changes are summarized below: Computer Software & Licenses - $12,034, a net decrease of$76,516 or 86.4% The $76,516 decrease was due to funding of a new multi-year contract for ongoing services and maintenance for the project management system, Constructware in FY 17-18. Materials & Program Expense - $95,507, a net decrease of$7,022 or 6.8% The $7,022 decrease includes a reduction in equipment maintenance expenses and a reallocation of utility expenses. Internal & Indirect Charges - $476,974, an increase of$28,475 or 6.0% The $28,475 increase is primarily related to the regional portion of the City of Springfield facility rents and building maintenance for use of the City Hall building. Property& Liablity Insurance - $350,000, a decrease of$10,000 or 2.8% The $10,000 decrease is based on recent pricing for insurance premiums, and multi-year agreements. Page 28 FY 18-19 BUDGET AND CIP Metropolitan Wastewater Management Commission Springfield Budget Detail EXHIBIT 8 SPRINGFIELD ADMINISTRATION PROGRAM ADOPTED FY 18-19 BUDGET SUMMARY ADOPTED AMENDED PROPOSED ACTUALS BUDGET BUDGET BUDGET CHANGE FY 16-17 FY 17-18 FY 17-18 FY 18-19 INCR/(DECR) Personnel Services $1,650,560 $1,804,742 $1,804,742 $1,899,321 $94,579 5.2% Materials & Services 1,678,9042,137,158 2,137,158 2,070,345 (66,813) -3.1% Capital Outlay 0 0 0 0 0 0% Budget Summary $3,329,464 13,941,900 $3,941,900 $3,969,666 $27,766 0.7% 5-YEAR MWMC BUDGET COMPARISON Aj6L— SPRINGFIELD ADMINISTRATION $5,000,000 $4,500,000 3 $4,000,000 $3,911,289 $3,833,401 $3,800,923 $3,941,900 $ 969,666 $3,500,000 $3,000,000 = — $2,500,000 $2,000,000 — $1,500,000 — $1,000,000 $500,000 $0 FY 14-15 FY 15-16 FY 16-17 FY 17-18 FY 18-19 Note: * Change column compares the adopted FY 18-19 Budget to the adopted FY 17-18 Budget. Page 29 FY 18-19 BUDGET AND CIP Metropolitan Wastewater Management Commission Springfield Budget Detail EXHIBIT 9 SPRINGFIELD ADMINISTRATION LINE ITEM BUDGET SUMMARY ADOPTED AMENDED PROPOSED CHANGE ACTUALS BUDGET BUDGET BUDGET FY 16-17 FY 17-18 FY 17-18 FY 18-19 INCR/(DECR) PERSONNEL SERVICES Regular Wages $1,116,088 $1,178,217 $1,178,217 $1,251,757 $73,540 6.2% Overtime 0 5,741 5,741 7,681 1,940 33.8% Employee Benefits 243,841 308,080 308,080 326,284 18,204 5.9% Health Insurance 290,631 312,704 312,704 313,599 895 0.3% Total Personnel Services $1,650,560 $1,804,742 $1,804,742 $1,899,321 $94,579 5.2% FTE 15.46 15.56 15.56 15.56 0.00 0.0% MATERIALS & SERVICES Billing&Collection Expense $602,729 $640,000 $640,000 $630,000 ($10,000) -1.6% Property &Liability Insurance 317,146 360,000 360,000 350,000 (10,000) -2.8% Contractual Services 31,460 133,500 133,500 140,550 7,050 5.3% Attorney Fees and Legal Expense 36,813 186,005 186,005 184,505 (1,500) -0.8% WPCF/NPDES Permits 125,800 136,500 136,500 137,000 500 0.4% Materials&Program Expense 98,746 102,529 102,529 95,507 (7,022) -6.8% Computer Software&Licenses 1,958 88,550 88,550 I� 12,034 (76,516) -86.4% Employee Development 6,310 19,275 19,275 21,275 2,000 10.4% Travel&Meeting Expense 16,202 22,300 22,300 22,500 200 0.9% Internal Charges 150,103 151,049 151,049 157,822 6,773 4.5% Indirect Costs 291,636 297,450 297,450 319,152 21,702 7.3% Total Materials& Services $1,678,904 $2,137,158 $2,137,158 $2,070,345 ($66,813) -3.1% CAPITAL OUTLAY Total Capital Outlay 0 0 0 0 0 0.0% TOTAL $3,329,464 $3,941,900 $3,941,900 $3,969,666 $27,766 0.7% Page 30 FY 18-19 BUDGET AND CIP Metropolitan Wastewater Management Commission Eugene Budget Detail CITY OF EUGENE REGIONAL WASTEWATER PROGRAM RESPONSIBILITIES The Wastewater Division for the City of Eugene manages all regional wastewater pollution control facilities serving the Program Responsibilities areas inside the Eugene and Springfield Urban Growth ■ Administration&Management Boundaries under the Intergovernmental Agreement for the ■ Biosolids Management Metropolitan Wastewater Management Commission ■ Facility operations (MWMC). These regional facilities include the ■ Facility Maintenance Eugene/Springfield Regional Water Pollution Control ' Environmental services Facility (WPCF), the Biosolids Management Facility, the ' Management Information services Beneficial Reuse Site, the Biocycle Farm site, and regional ' Project Management wastewater pumping stations and transmission sewers. In support of the water pollution control program, the Division provides technical services for wastewater treatment, management of equipment replacement and infrastructure rehabilitation, biosolids treatment and recycling, regional laboratory services, and an industrial source control and pretreatment program in conjunction with City of Springfield staff. ADMINISTRATIVE AND MANAGEMENT SERVICES Administrative Services provides management, administrative, and office support to the Wastewater Division. This support includes the general planning, directing, and managing of the activities of the Division; development and coordination of the budget; administration of personnel records; and processing of payroll, accounts payable, and accounts receivable. This section also provides tracking and monitoring of all assets for the regional wastewater treatment facilities and support for reception, customer service, and other administrative needs. The Administrative services include oversight and coordination of the Division's Environmental Management System, safety, and training programs, and a stores unit that purchases and stocks parts and supplies and assists with professional services contracting. Another area this program administers is the coordination of local and regional billing and rate activities. REGIONAL WASTEWATER TREATMENT FACILITY OPERATIONS The Wastewater Division operates the WPCF to treat domestic and industrial liquid wastes to achieve an effluent quality that protects and sustains the beneficial uses of the Willamette River. The Operations section optimizes wastewater treatment processes to ensure effluent quality requirements are met in an efficient and cost effective manner. In addition, the Operations section provides continuous monitoring of the alarm functions for all plant processes,regional and local pump stations, Biosolids Management Facility, and the Beneficial Reuse Site. MAINTENANCE The mechanical, electrical, and facilities maintenance sections of the Wastewater Division are responsible for preservation of the multi-million dollar investment in the equipment and infrastructure of the WPCF, local and regional pump stations, pressure sewers, as well as the Biosolids Management Facility. These sections provide a preventative maintenance program to Page 31 FY 18-19 BUDGET AND CIP Metropolitan Wastewater Management Commission Eugene Budget Detail maximize equipment life and reliability; a corrective maintenance program for repairing unanticipated equipment failures; and a facility maintenance program to maintain the buildings, treatment structures, and grounds. BIOSOLIDS MANAGEMENT The Residuals Management section of the Wastewater Division manages the handling and beneficial reuse of the biological solids (biosolids)produced as a result of the activated sludge treatment of wastewater. This section operates the Biosolids Management Facility (BMF) and the Biocycle Farm located at Awbrey Lane in Eugene. The biosolids are treated using anaerobic digestion, stored in facultative lagoons (which provide some additional treatment benefits), and then processed through a belt filter press and air-dried to reduce the water content and facilitate transport. The dried material is ultimately applied to agricultural land. Biosolids are also irrigated on poplar trees at the Biocycle Farm as a beneficial nutrient and soil conditioner. This section also operates the Beneficial Reuse Site which formerly served to treat wastewater from food processing operation. ENVIRONMENTAL SERVICES Environmental Services is comprised of Industrial Source Control (Pretreatment), Analytical Services, and Sampling Team. Industrial Source Control - The pretreatment program is a regional activity implemented jointly by the cities of Eugene and Springfield. The Industrial Source Control group of the Wastewater Division is charged with administering the pretreatment program for the regulation and oversight of commercial and industrial wastewaters discharged to the wastewater collection system by fixed-site industries in Eugene and by mobile waste haulers in the Eugene and Springfield areas. This group is also responsible for ensuring that these wastes do not damage the collection system, interfere with wastewater treatment processes,result in the pass-through of harmful pollutants to treated effluent or biosolids, or threaten worker health or safety. This responsibility is fulfilled through the use of a permit system for industrial dischargers. This permit system, common to both Eugene and Springfield, implements necessary limitations on waste characteristics and establishes inspection,monitoring, and reporting requirements for documenting waste quality and quantity controls. The staff is also responsible for locating new industrial discharges in Eugene and evaluating the impact of new non-residential discharges on the WPCF. The section also has responsibilities related to environmental spill response activities. Analytical Services - The Analytical Services group provides analytical laboratory work in support of wastewater treatment, residuals management, industrial source control, stormwater monitoring, and special project activities of the Wastewater Division. The laboratory's services include sample handling and analyses of influent sewage, treated wastewater, biosolids, industrial wastes, stormwater, and groundwater. Information from the laboratory is used to make treatment process control decisions, document compliance with regulatory requirements, demonstrate environmental protection, and ensure worker health and safety. Sampling Team - The Sampling Team is responsible for sampling activities related to regional wastewater program functions. These include the Eugene pretreatment program, wastewater treatment process control, effluent and ambient water quality, groundwater quality, facultative Page 32 FY 18-19 BUDGET AND CIP Metropolitan Wastewater Management Commission Eugene Budget Detail sludge lagoons, and stormwater samples. The Division's Environmental Data Analyst evaluates and reports on the sampling data for various programs. MANAGEMENT INFORMATION SERVICES (MIS) The MIS section provides services for electronic data gathering, analysis, and reporting in compliance with regulatory requirements and management functions. This section also maintains the network communication linkages with the City of Eugene and supplies technical expertise and assistance in the selection, operation, and modification of computer systems (hardware and software)within the Division. PROJECT MANAGEMENT Management of wastewater system improvements and ongoing developments is carried out by the Project Management staff. Activities include coordination of CIP activities with the City of Springfield staff, problem-solving and action recommendations,project management, technical research, coordination of activities related to renewal of the National Pollutant Discharge Elimination System (NPDES)wastewater discharge permit, computer-aided design and electronic storage of design drawings, and planning of projects to anticipate and prepare for new regulatory and operational requirements. The Project Management staff develops Request for Proposals and Request for Quotes, coordinates special project activities between work sections, and coordinates the procurement of building permits as necessary in support of project activities. PROGRAMS AND SIGNIFICANT SERVICE/EXPENDITURE CHANGES In FY 18-19, Eugene staff will support the following major regional initiatives in addition to ongoing operational activities. ■ Manage the O&M responsibilities of the NPDES permits for the treatment of wastewater and the Lane Regional Air Protection Agency (LRAPA) air emissions permit for the regional wastewater treatment plant. ■ Evaluate impacts of regulatory actions upon operational responsibilities such as the federal sanitary sewer overflows (SSO), blending policy development,Willamette River TMDLs implementation, and any newly adopted state water quality standards. ■ Provide technical input and O&M assessments related to proposed initiatives for addressing TMDL compliance and renewable energy objectives. ■ Complete scheduled major rehabilitation, equipment replacement, and other capital projects in an efficient and timely manner. ■ Work cooperatively on CIP elements and effectively integrate capital project work with ongoing O&M activities with an emphasis on maintaining an effective CIP management and coordination program with Springfield staff. ■ Manage the Operations& Maintenance (O&M) aspects of the Biocycle Farm, continuing biosolids irrigation practices and poplar tree management. Page 33 FY 18-19 BUDGET AND CIP Metropolitan Wastewater Management Commission Eugene Budget Detail SIGNIFICANT CHANGES IN THE O &M BUDGET FOR FY 18-19 The budget for Operations and Maintenance of the regional wastewater treatment facilities (personnel,materials and services, and capital outlay)for FY 18-19 totals $14,149,751. The amount represents a decrease of$196,549 or 1.4%from the FY 17-18 budget. The significant cost centers for the budget include personnel costs,contractual services,utilities,materials,maintenance,fleet, and chemicals. Details of significant items and changes for the FY 18-19 Operations and Maintenance budget as compared to the FY 17-18 budget include: Personnel Services Personnel Services totaling$9,204,678 represents a FY 18-19 increase of$212,493 or 2.4%. The major changes are in the following budget categories: Staffing The FY 18-19 budget includes a 0.96 Full Time Equivalent(FTE)increase in staffing level from FY 17-18 budget. This increase was a mid-year FYI 7-18 FTE increase using ongoing appropriation approved in FY 15-16 for landscape maintenance services. Current staffing is at 78.36 Full Time Equivalent(FTE). Regular Wages-$5,395,708,an increase of$105,427 or 2.0% Salaries are based upon the negotiated management/labor contracts between the City of Eugene and the local union(AFSCME)_ The current AFSCME contract is effective through June 20, 2020. Employee Benefits -$2,105,756,an increase of$91,316 or 4.5% The employee benefits consist mainly of PERS/OPSRP retirement system costs,FICA, and Medicare contributions. Health Insurance-$1,545,853,an increase of$18,908 or 1.2% The increase is based on group claims experience and cost projections. Costs are calculated based on the number of employees. Materials and Services The Materials and Services budget totaling $4,781,367 represents an FY 18-19 decrease of $464,888 or 8.9%. The major changes are in the following budget categories: Indirect Charges - $992,285, a net decrease of$40,415 or 3.9% This expenditure category includes costs for payroll processing,human resources services, information technology services, and budget and financial services provided by the City of Eugene to the Wastewater Division. Contractual Services-$477,997,a net decrease of$276,016 or 36.6% This account includes services for outside lab testing,USGS water monitoring, seasonal temporary help, and grit waste disposal. The decrease for this item is mostly due from budgeting one-time projects in FY 17-18 and an expected reduction in temporary help and professional services for FY 18-19. Page 34 FY 18-19 BUDGET AND CIP Metropolitan Wastewater Management Commission Eugene Budget Detail Utilities -$776,418,a net decrease of$75,847 or 8.9% The Utilities account includes the purchase of electrical power,natural gas,water, and sewer charges for all regional facilities. The decrease is mainly due to having an additional $75,000 appropriation in the FY17-18 budget to cover the cost of planned down-time for the co- generation engine replacement at the WPCF. The co-generation engine is expected to be fully operational for FYI 8-19 and no extra appropriation is needed. Fleet-$412,257,a net decrease of$40,191 or 8.9% Fleet services are managed centrally by Eugene Fleet Services. Budgeted fleet rates are based upon recent vehicle and equipment maintenance costs. Eugene Capital Outlay Expense - $163,706,an increase of$55,846 or 51.8% Eugene Capital Outlay budget requests include: 1)Tables, chairs, shelving, fixtures—building improvements, 2)External Filtration—Aeration Basin Blower Number 6, 3)Ammonia Probes— Secondary Area, and 4)Blanket finders—Clarifiers. EXHIBIT 10 EUGENE-OPERATIONS AND MAINTENANCE PROGRAM ADOPTED FY 18-19 BUDGET SUMMARY ADOPTED AMENDED PROPOSED ACTUALS BUDGET BUDGET BUDGET CHANGE* FY 16-17 FY 17-18 FY 17-18 FY 18-19 INCR/(DECR) Personnel Services $8,111,556 $8,992,185 $8,992,185 $9,204,678 $212,493 2.4% Materials&Services 4,401,963 5,246,255 5,275,775 4,781,367 (464,888) -8.9% Capital Outlay 48,492 107,860 218,263 163,706 55,846 51.8% Budget Summary $12,562,010 $14,346,300 $14,486,223 $14,149,751 ($196,549) -1.4% 6-YEAR MWMC BUDGET COMPARISON EUGENE -OPERATIONS AND MAINTENANCE $18,000,000 $16,000,000 — $14,346,300 $14,000,000 $127713158 $13,516,071 $13,899,707 $14,149,751 $12,000,000 $10,000,000 $8,000,000 $6,000,000 $4,000,000 $2,000,000 $0 FY 14-15 FY 15-16 FY 16-17 FY 17-18 FY 18-19 NOTE:Does not include Major or Equipment Replacement Page 35 FY 18-19 BUDGET AND CIP Metropolitan Wastewater Management Commission Eugene Budget Detail EXHIBIT 11 EUGENE-OPERATIONS&MAINTENANCE LINE ITEM BUDGET SUMMARY ADOPTED AMENDED PROPOSED ACTUAL BUDGET BUDGET BUDGET CHANGE FY 16-17 FY 17-18 FY 17-18 FY 18-19 INCR/(DECR) PERSONNEL SERVICES Regular Wages $4,899,473 $5,290,281 $5,290,281 $5,395,708 $105,427 2.0% Overtime 36,200 40,000 40,000 40,000 0 0.0% Employee Benefits 1,751,437 2,014,440 2,014,440 2,105,756 91,316 4.5% Workers'Comp/UnemployIns 108,025 120,519 120,519 117,361 (3,158) -2.6% Health Insurance 1,316,421 1,526,945 1,526,945 1,545,853 18,908 1.2% Total Personnel Services $8,111,556 $8,992,185 $8,992,185 $9,204,678 $212,493 2.4% FTE 77.40 77.40 78.36 78.36 0.96 1.2% MATERIALS&SERVICES Utilities $765,257 $852,265 $852,265 $776,418 ($75,847) -8.9% Fleet Operating Charges 657,063 452,448 452,448 412,257 (40,191) -8.9% Maintenance-Equip&Facilities 141,869 354,523 354,523 308,160 (46,363) -13.1% Contractual Services 374,767 754,013 754,013 477,997 (276,016) -36.6% Materials&Program Expense 517,260 725,287 754,806 726,971 1,684 0.2% Chemicals 298,076 323,700 323,700 330,000 6,300 1.9% Parts&Components 378,703 367,746 367,746 355,120 (12,626) -3.4% Indirects 905,887 1,032,700 1,032,700 992,285 (40,415) -3.9% Total Materials&Services $4,401,963 $5,246,255 $5,275,775 $4,781,367 ($464,888) -8.9% CAPITAL OUTLAY Motorized Vehicles $42,890 $0 $110,403 $0 $0 NA Capital Outlay -Other 5,602 107,860 107,860 163,706 55,846 51.8% Total Capital Outlay $48,492 $107,860 $218,263 $163,706 $55,846 51.8% TOTAL $12,562,010 $14,346,300 $14,486,223 $14,149,751 ($196,549) -1.4% Page 36 FY 18-19 BUDGET AND CIP Metropolitan Wastewater Management Commission Capital Improvement Program REGIONAL WASTEWATER PROGRAM CAPITAL PROGRAMS Overview The Regional Wastewater Program (RWP) includes two components: the Capital Improvement Program (CIP) and the Asset Management Capital Program (AMCP). The FY 18-19 CIP Budget, the FY 18-19 AMCP Budget, and the associated 5-Year Capital Plan are based on the 2004 MWMC Facilities Plan (2004 FP) and the 2014 Partial Facilities Plan Update. The 2004 FP was approved by the MWMC, the governing bodies of the City of Eugene, the City of Springfield, Lane County, and the Oregon Department of Environmental Quality (DEQ) in 2004. The 2004 FP and its 20-year capital project list was the result of a comprehensive evaluation of the regional wastewater treatment facilities serving the Eugene-Springfield metropolitan area. The 2004 FP built on previous targeted studies, including the 1997 Master Plan, 1997 Biosolids Management Plan, 2001 Wet Weather Flow Management Plan(WWFMP), and the 2003 Management Plan for a dedicated biosolids land application site. The 2004 FP was intended to meet changing regulatory and wet weather flow requirements and to serve the community's wastewater capacity and treatment needs through 2025.Accordingly, the 2004 FP established the CIP project list to provide necessary facility enhancements and expansions over the planning period. The CIP is administered by the City of Springfield for the MWMC. The AMCP implements the projects and activities necessary to maintain functionality, lifespan, and effectiveness of the MWMC facility assets on an ongoing basis. The AMCP is administered by the City of Eugene for the MWMC and consists of three sub-categories: ■ Equipment Replacement Program ■ Major Rehabilitation Program ■ Major Capital Outlay The MWMC has established these capital programs to achieve the following RWP objectives: ■ Compliance with applicable local, state, and federal laws and regulations ■ Protection of the health and safety of people and property from exposure to hazardous conditions such as untreated or inadequately treated wastewater ■ Provision of adequate capacity to facilitate community growth in the Eugene-Springfield metropolitan area consistent with adopted land use plans ■ Construction, operation, and management of the MWMC facilities in a manner that is as cost-effective, efficient, and affordable to the community as possible in the short and long term ■ Implementation of the Citizens Advisory Committee recommendations,which represent diverse community interests, values and involvement, and that have been adopted by the Commission as the MWMC's plans and policies ■ Mitigation of potential negative impacts of the MWMC facilities on adjacent uses and surrounding neighborhoods (ensuring that the MWMC facilities are "good neighbors" as judged by the community) Page 37 FY 18-19 BUDGET AND CIP