FINANCE COMMITTEE MEETING...A. Discussion on adding a Special Finance Committee Meeting on June 9. th. at 12N. 4. Consent Calendar. Consent Calendar item(s) are considered to be routine

MEMBER AGENCIES ATHERTON * BELMONT * BURLINGAME * EAST PALO ALTO * FOSTER CITY * HILLSBOROUGH * MENLO PARK * REDWOOD CITY

* SAN CARLOS * SAN MATEO * COUNTY OF SAN MATEO * WEST BAY SANITARY DISTRICT

PURSUANT TO GOVERNOR NEWSOM'S EXECUTIVE ORDER N-29-20, THE MEETING WILL BE HELD BY TELECONFERENCE AND/OR VIDEO CONFERENCE ONLY. THE PUBLIC MAY PARTICIPATE BY SUBMITTING COMMENTS ON ANY AGENDA ITEM VIA EMAIL PRIOR TO OR DURING THE MEETING BY SENDING THOSE COMMENTS TO [email protected].

TELECONFERENCE PARTICIPANTS ALL BOARDMEMBERS WILL PARTICIPATE BY TELECONFERENCE AND/OR VIDEO CONFERENCE PURSUANT TO GOVERNOR NEWSOM’S EXECUTIVE ORDER N-25-20

PURSUANT TO RALPH M. BROWN ACT, GOVERNMENT CODE SECTION 54953, ALL VOTES SHALL BE BY ROLL CALL DUE TO ALL BOARDMEMBERS PARTICIPATING BY TELECONFERENCE AND/OR VIDEO CONFERENCE

ANY REQUEST FOR REASONABLE ACCOMMODATION SHOULD BE ADDRESSED TO CYNDI URMAN AT [email protected].

AGENDA 1. Roll Call

2. Public CommentPersons wishing to address the Board on matters NOT on the posted agenda may do so. Each speaker is limited to two minutes. If thereare more than five individuals wishing to speak during public comment, the Chairman will draw five speaker cards from those submitted tospeak during this time. The balance of the Public Comment speakers will be called upon at the end of the Board Meeting. If the item youare speaking on is not listed on the agenda, please be advised that the Board may briefly respond to statements made or questions posedas allowed under The Brown Act (Government Code Section 54954.2). The Board's general policy is to refer items to staff for attention, orhave a matter placed on a future Board agenda for a more comprehensive action or report and formal public discussion and input at thattime.

3. Executive Director’s Welcome p. 3A. Discussion on adding a Special Finance Committee Meeting on June 9th at 12N

4. Consent CalendarConsent Calendar item(s) are considered to be routine and will be enacted by one motion. There will be no separate discussion on theseitems unless members of the Board, staff or public request specific items be removed for separate action. Items removed from theConsent Calendar will be moved to the end of the agenda for separate discussion.A. Approval of Minutes from the January 14, 2020 Finance Committee Meeting p. 7

5. Discussion of Cost of COVID-19 Shelter-in-Place Order p. 13

6. Resolution Recommending Approval of Revised SBWMA Investment Policy for 2020 p. 19

7. Proposed Work Plan Transitioning the South Bayside Waste Management Authority’s Financial Systemsfrom a Fiscal Year Accounting Period Ending June 30, to Calendar Year Accounting Period EndingDecember 31 p. 37

FINANCE COMMITTEE MEETING TUESDAY, MAY 12, 2020 AT 12:00pm

VIA ZOOM MEETING ONLY Link to Join: https://us02web.zoom.us/j/85000774732

Phone number for voice access: 1 (669) 900 9128 Meeting ID: 850-0077-4732

Password: 021917

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MEMBER AGENCIES ATHERTON * BELMONT * BURLINGAME * EAST PALO ALTO * FOSTER CITY * HILLSBOROUGH * MENLO PARK * REDWOOD CITY

* SAN CARLOS * SAN MATEO * COUNTY OF SAN MATEO * WEST BAY SANITARY DISTRICT

p. 43

p. 67

8. Review Property Insurance Renewal

9. Resolution Recommending Approval of the Calendar Year 2019 Financial Statements

10. Review of FY 20/21 budget and 6-month (July 1, 2020 – December 31, 2020) Transition Budget and Cap-Ex Review p. 81

11. Presentation by South Bay Recycling (SBR) regarding their Request for Compensation Adjustment p. 103

12. Finance Committee Member Comments

13. Adjourn


3

EXECUTIVE DIRECTOR’S WELCOME

Agenda Item 3 and 3A are verbal reports only at the 05/12/2020 SBWMA Finance Committee Meeting

Agenda Item 3



4

CONSENT CALENDAR

Agenda Item 4



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4A

_________________________________________________________________________________________ DRAFT MINUTES

SOUTH BAYSIDE WASTE MANAGEMENT AUTHORITY MEETING OF THE FINANCE COMMITTEE

January 12, 2019 12:00PM SBWMA Conference Room, 610 Elm Street Suite 202, San Carlos, CA

Call To Order: 12:09PM 1. Roll Call

SBWMA Staff Members Present: Joe La Mariana, John Mangini, Cyndi Urman, Jean Savaree, Others Present: Grace Zhang, Maze and Associates; Tracy Swanborn, and Marva Sheehan, HF&H Consultants; Garth Schultz R3 Consulting, by phone. 2. Public Comment

Persons wishing to address the Board on matters NOT on the posted agenda may do so. Each speaker is limited to two minutes. If there are more than five individuals wishing to speak during public comment, the Chairman will draw five speaker cards from those submitted to speak during this time. The balance of the Public Comment speakers will be called upon at the end of the Board Meeting. If the item you are speaking on is not listed on the agenda, please be advised that the Board may briefly respond to statements made or questions posed as allowed under The Brown Act (Government Code Section 54954.2). The Board's general policy is to refer items to staff for attention, or have a matter placed on a future Board agenda for a more comprehensive action or report and formal public discussion and input at that time. None

3. Executive Director’s Update

Executive Director La Mariana welcomed everyone and introduced the new Finance Committee members: Brenda Olwin, East Palo Alto’s Finance Director; and Board Member Fran Dehn. He thanked Board Member Michael Brownrigg for his time on the Finance Committee. He then made these announcements: • At the April Finance Committee meeting there will be a transition plan for moving from fiscal year to

calendar year financial statements. Also, in April, the Board will be considering an updated procurement

Agency Present Absent

Bill Widmer X Jay Benton X Fran Dehn X Carol Augustine X Brenda Olwin X


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policy. Part of the recommendation is based on SB1383 requirements, and part of it is to look at the signing authority for the Executive Director.

o The Committee discussed the need for an increased internal spending authority, they shared concerns about staff needing less than the time between Board meetings to make decisions over $50,000, if it wasn’t an emergency.

• He introduced Matt Southworth as the SBWMA’s new part-time Senior Engineer • The installation of the Organics-to-Energy equipment is almost complete, and after testing it is expected

to be up and running in March. o Member Benton asked why the 30-60-day delay. Executive Director La Mariana answered that

there have been some unexpected permitting issues, including a sprinkler requirement for a liquid based process. The Committee suggested appealing to the fire marshal regarding the required sprinkler requirement.

• He announced that he has been invited to the Governor’s office to discuss AB1509 before it goes to the Senate.

• Silicon Valley Clean Water is doing a big project adjacent to the Shoreway site, and staff has just received word that there are going to be significant road closures this summer due to the project which will cause major operational issues.

4. Consent Calendar

Consent Calendar item(s) are considered to be routine and will be enacted by one motion. There will be no separate discussion on these items unless members of the Board, staff or public request specific items be removed for separate action. Items removed from the Consent Calendar will be moved to the end of the agenda for separate discussion. A. Approval of Minutes from the May 7, 2019 Special Finance Committee Meeting B. Approval of Minutes from the June 12, 2019 Special Finance Committee Meeting Motion/Second: Widmer/Benton Voice Vote: All in Favor

5. Approval of Annual Fiscal Year FY18/19 Financial Audit by Maze and Associates

Staff Mangini gave an overview of the draft staff report set to go the Board at the end of the month. The Committee discussed that that audited statements do not include the bond refunding as there is a statement in the report that there was a subsequent event to year end which affects the finances. Member Benton asked how much reserve money was used in FY18/19, because it looks flat. Staff Mangini answered that the construction in progress number of $2.4M would have come from reserves as capital assets. The Committee asked for comments from the auditor. Grace Zhang noted that the transition to Redwood City went really smooth, and she thanked Derek for his assistance. The report is final, unless this committee notices anything that needs to be changed. Motion/Second: Benton/Widmer Voice vote; All in favor

6. Mid-Year Budget and Cap-Ex Review



Staff Mangini gave an overview of the staff report, and the process of the mid-year budget. The Committee discussed the expiring organics contract at Blossom Valley Organics. There was a concern that increasing organics processing costs would be higher than the 2020 tip fees, which are not being increased. Staff Mangini noted that the contract expired December 31, 2020, and this mid-year budget concludes on June 30, 2020, so it was not considered in this budget. Executive Director La Mariana noted that at the February Board meeting he was hoping to have pricing from Blossom Valley. Member Benton asked why franchised tonnage is down. Staff Mangini noted that it’s an updated projection of just 1% lower, but franchised tonnage doesn’t move all that much. The committee discussed having conversions available to be able to measure the tonnage measured material versus the yardage measured material when the Board discusses the mid-year budget. Member Benton noted a typo in the budget presentation of the wrong year that should be corrected before the packet goes to the Board. The committee discussed the interest income increase, noting that interest income is not that much higher year over year, just higher than what was budgeted. Derek Rampone noted that there was an adjustment in the fair value of the Agency’s investment, but the difference year over year is mostly due to the bond proceeds. Member Benton questioned if the interest should be higher if there have been 9 months invested of bond proceeds the interest should be closer to $200,000, staff will look at the totals and get back to the committee to make sure it is properly invested. Staff Mangini noted that the $1M grant from the County for the Organics-to-Energy project would be included as revenue in the budget that will go to the Board. The Committee discussed reserves, Member Benton asked if the $4.1M number in the budget was the capital reserve, or if this was the reserve number before anything had been allocated. Derek Rampone answered that it’s before the funds have been allocated. Staff Mangini noted that there is now a sub-emergency reserve that is the difference in the insurance premium when the Board voted to increase the deductible and lower the premium. The committee asked that this reserve be called out more specifically. Member Benton asked about the $1.2M Shoreway Remediation fund, and whether that would be used this year. Staff Mangini added that the money would be used when the underground storage tanks are moved above ground. Member Benton made a motion that the Finance Committee recommend to the Board approval of the mid-year budget. Member Widmer seconded the motion. Voice Vote: All in favor

7. Adoption of Annual Investment Policy Recommendation Staff Mangini highlighted the changes in the proposed investment policy. Member Widmer reiterated that he would like work with investment advisors to survey the Finance Directors of each of the Member Agencies to see how the Member Agencies invest to see if there are any options



other than LAIF. Member Augustine noted that staff looked into that a couple of years ago, and the size of the portfolio may not be enough to make a difference. Derek Rampone added that Redwood City uses PFM and if the SBWMA can piggyback on that agreement there may be a way to get around the cost-benefit. Member Widmer made a motion that the Finance Committee recommend to the Board approval of the investment policy with the amendment that staff research the possibility of other investment options. Member Benton seconded the motion. Voice Vote: All in favor

8. Review of SB1383 Gap Analysis Presentation by Tracy Swanborn, HF&H Consultants

Tracy Swanborn of HF&H Consultants gave a PowerPoint Presentation on SB1383 costs and potential options for the SBWMA to meet the SB1383 requirements. Member Benton asked what the Board should being doing now regarding SB1383. Tracy Swanborn answered that the Agency needs to give staff direction as to what compliance plan option to go for.

9. Review of Buyback Center Cost Options Analysis Presentation via phone by Garth Shultz, R3 Consultants

Garth Schultz of R3 Consultants gave a verbal presentation via phone call on his analysis of CRV redemption alternatives. Member Benton asked about businesses that sell CRV bottles and cans requirements to pay the CRV back to customers or pay a fine. Garth answered that the law was written that business that sell CRV bottles and cans must then take back the bottles and cans so customers can redeem the CRV or they have to pay a fine, it has always been a part of the law. Recently with the issues the program has been facing CalRecycle is getting more assertive about enforcing the fines.

10. Finance Committee Member Comments 11. Adjourn 2:14PM


5

Discussion of Cost Impacts of COVID-19

Shelter-in-Place Order

Agenda Item 5



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5

STAFF REPORT To: SBWMA Board Members From: Joe LaMariana, Executive Director John Mangini, Senior Finance Manager Hilary Gans, Senior Facilities Manager Date: May 12, 2020 Finance Committee Meeting Subject: Discussion Cost impacts of COVID-19 Shelter-in-Place Order Recommendation This is a discussion item only and no action is required. Summary Due to the Shelter-in-Place Order the Shoreway Facility has experienced a reduction in material volume received at the gate. This is due to 1) a loss of Public/Self-Haul tonnage to the transfer station - Public/Self-Haul tonnage was discontinued in mid-March 2020, and 2) a reduction in franchise commercial waste streams delivered to Shoreway by Recology. There has been an overall reduction of 30% (11,894 tons) in the month of April over prior year. (See Table 1) In the month of April, franchise commercial and residential tonnage has dropped 54% and 12% respectively over April prior year. This tonnage shortfall has had a impact on the Agency’s net income in the range of $334K and $395K per month. Despite the loss of tonnage, the Agency has maintained employment for the 14 Shoreway facility workers (sorters, spotters, and scale operators) that would have otherwise been furloughed due to lack of work. These workers were reassigned on March 17th to complete necessary maintenance and cleaning projects at Shoreway. (Table 2 below presents the status of project at the site, the man-hours and dollars associated with the labor projects). During the roughly 1½-months that the workers were assigned to projects, many important projects have been completed that have improved the appearance, operations and safety at the Shoreway facility. Examples of these projects include: (See photos of completed projects in Attachment A)

Table 1. Shoreway C19 Tonnage Impact (April 2019 vs 2020)

Category Percent Tons

Self Haul -100% -4,043

Commercial -54 % -7,585

Residential -12 % -2,636

Total to Date -30 % -11,894

Table 2. Shoreway C19 Projects . (manhours and expense through April 1)

Category Man Hours Labor Expense

Completed 1,352 $ 82,253

In Progress 46 $ 2,586

On Standby 28 $ 1,630

Canceled 69 $ 491 Total to Date 1,494 $ 86,961


SBWMA FINANCE COMMITTEE PACKET 05/12/2020 AGENDA ITEM: 5 - p2

• restriping the pavement for parking and vehicle travel onsite • painting safety bollards, curbing, and signage • pressure washing the TS and MRF skylights • pressure washing and painting the interior and exterior walls of the transfer station • improve the onsite educational tour route

On May 4th the shelter-in-place directive was lifted for certain categories of work and the Shoreway Facility was reopened for public/self-haul customers. As a result these workers have mostly return to their normal work roles. Analysis Table 3 below illustrates the lost revenue and cost avoidance estimates measured by the volume decrease from the period of March 1 to March 15 compared to April 1 to April 15. The volume measures a 10-workday and 2-weekend days in each period. The high and low estimate is based on a range of density in yards/ton for Self-Haul material.

Table 3

Fiscal Impact The Shelter-in-Place Order is estimated to have a negative impact on Agency net income in the range of $334K and $395K per month. If inbound material volume continues at the rates tested, the impact on FY 2020 net income is estimated be between $1.2M and $1.4M.

Attachments: Attachment A – Shoreway Project Photos

Low HighSelf Haul Lost Revenue / Mth 813,827 813,827 Self Haul Cost Avoidance / Mth 580,681 520,124

Self Haul - Net Income Loss Range / Mth 233,146 293,703

Franchise Lost Revenue / Mth 349,984 349,984 Franchise Cost Avoidance / Mth 248,808 248,808

Franchise - Net Income Loss Range / Mth 101,176 101,176

Total Net Income Loss Range / Mth 334,322 394,879

FY2020 Est Impact (3.5 months) 1,170,127 1,382,076

Shelter-in-Place Estimated Monthly Income Loss (due to volume decrease)


ATTACHMENT A – Shoreway Project Photos

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Cleaning TS and MRF Roof Skylights

Painting Transfer Station walls traffic lanes, curbs & bollards


SBWMA FINANCE COMMITTEE PACKET 05/12/2020 AGENDA ITEM: 5 ATTACHMENT A - p2


6

Resolution Recommending Approval of Revised SBWMA

Investment Policy for 2020

Agenda Item 6



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6

STAFF REPORT To: SBWMA Board Members From: John Mangini, Senior Finance Manager Date: May 12, 2020 Finance Committee Meeting Subject: Resolution Recommending Approval of Revised SBWMA Investment Policy for 2020 Recommendation It is recommended that the SBWMA Board of Directors approve Resolution No. 2019-02 attached hereto authorizing the adoption of the Investment Policy for 2020. See Exhibit A to the Resolution for the proposed 2020 Investment Policy. Summary The SBWMA’s current Investment Policy states that the policy shall be reviewed and adopted by resolution of the Board on an annual basis. This policy was last approved by the Board on January 24, 2019. The 2020 policy has been reviewed by the Board Finance Sub-Committee (comprised of Board Members Jay Benton, Michael Brownrigg, Fran Dehn and Member Agency Finance Directors Carol Augustine and Brenda Olwin) which recommends approval. The recommended minor changes to the policy are shown in the attached redline version (see Exhibit A). The changes involve the assignment of managing the SBWMA’s investments to the newly selected City of Redwood City Accounting Services Team (serving as the Fiscal Agent for the Authority) and updating language to be consistent with California Code. Redwood City Staff and Redwood City’s investment advisory firm, PFM Consulting, also reviewed the investment policy and provided the redline edits related to California code language. The Revised 2020 Investment Policy was reviewed by the Board at its January 30, 2020 Meeting. At that time, the Board requested that staff to research and propose new policy language to reflect strong environmentally-responsible investing that aligns with the Authority’s environmental stewardship principals and objectives, as outlined in the SBWMA’s 2020 Long Range Plan and with our Member Agency’s individual Climate Action and Environmental stewardship goals. Based on this direction, the language in Table 1 below has been added to the proposed 2020 Investment Policy. There are no other substantial changes to the policy. Table 1

ENVIRONMENTALLY RESPONSIBLE INVESTING

When possible, the Authority will invest in companies that demonstrate verifiable environmental stewardship policies that align with the SBWMA’s Triple Zero goals. These goals are identified in the Authority’s 2020 Long Range Plan-Guiding Principles and Objectives. They are:

1. Eliminate the disposal of recyclable materials at landfills2. Eliminate the disposal of organic materials at landfills3. Minimize Agency greenhouse gas emissions (through measures such as using low-emission vehicle fuels and

reducing the need for materials collection and transfer of materials).

These goals will allow the Authority’s environmental responsible asset investment to strategically align with its mission, and with its Member Agencies’ own environmental visions.



Analysis On August 24, 2000, the Board approved the first Investment Policy based on the City of San Carlos’ Investment Policy. The Board has since approved revisions on an annual basis. The attached 2020 Investment Policy is fully compliant with California Code. The primary objective of the Investment Policy is safety of principal, while meeting the cash flow needs of the JPA, through prudent investment of surplus cash. Background In January 2015, the Audit Committee reviewed the mix of investments between the County Pool and the state LAIF fund. The Audit Sub-Committee agreed to increase the County Fund to 30% to 50% while keeping the state LAIF Fund at 50% to 70%. This change was approved by the Board at the January 22, 2015 Board meeting. Fiscal Impact There is no fiscal impact associated with approving the attached revised Investment Policy.

Attachments: Resolution 2020-XX

Exhibit A – Investment Policy (red-line version)



RESOLUTION NO. 2020-XX

RESOLUTION OF THE SOUTH BAYSIDE WASTE MANAGEMENT AUTHORITY BOARD OF DIRECTORS

APPROVING A REVISED INVESTMENT POLICY FOR 2020

WHEREAS, the South Bayside Waste Management Authority (SBWMA) and the City of Redwood City has reviewed and revised the SBWMA’s current Investment Policy; WHEREAS, the Board’s Finance Sub-Committee has also reviewed the Policy and supports the recommended changes; NOW, THEREFORE BE IT RESOLVED that the South Bayside Waste Management Authority hereby approves the 2020 SBWMA Investment Policy document as shown in Exhibit A. PASSED AND ADOPTED by the Board of Directors of the South Bayside Waste Management Authority, County of San Mateo, State of California on the 28th day of May 2020, by the following vote:

I HEREBY CERTIFY that the foregoing Resolution No. 2019-XX was duly and regularly adopted at a regular meeting of the South Bayside Waste Management Authority on May 28, 2020. ATTEST: Jay Benton, Chairperson of SBWMA _________________________________ Cynthia Urman, Board Secretary

Agency Yes No Abstain Absent Agency Yes No Abstain Absent Atherton Menlo Park Belmont Redwood City Burlingame San Carlos East Palo Alto San Mateo Foster City County of San Mateo Hillsborough West Bay Sanitary Dist.


South Bayside Waste Management Authority Investment Policy Page 1

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SOUTH BAYSIDE WASTE MANAGEMENT AUTHORITY INVESTMENT POLICY

January 2019May 2020 POLICY The investment of the funds of the South Bayside Waste Management Authority (SBWMA) is directed to the goals of safety, liquidity and yield. This Investment Policy incorporates the policies defined by the certified investment policy standards recommended by the California Debt and Investment Advisory Commission (CDIAC). The authority governing investments for municipal governments is set forth in the California Government Code, Sections 53601 53600 through 53686. The primary objective of the investment policy of the South Bayside Waste Management Authority is SAFETY OF PRINCIPAL. Investments shall be placed in those securities as outlined by type and maturity sector in this document. Effective cash flow management and resulting cash investment practices are recognized as essential to good fiscal management and control. The SBWMA's portfolio shall be designed and managed in a manner responsive to the public trust and consistent with state and local law. Portfolio management requires continual analysis and as a result the balance between the various investments and maturities may change in order to give the SBWMA the optimum combination of necessary liquidity and optimal yield based on cash flow projections. SCOPE The investment policy applies to all financial assets of the South Bayside Waste Management Authority as accounted for in the Annual Financial Statements. Policy statements outlined in this document focus on the SBWMA's pooled funds and debt-related funds held by the trustee/ fiscal agent. PRUDENCE The standard to be used by investment officials shall be that of a "prudent investor" and shall be applied in the context of managing all aspects of the overall portfolio. When investing, reinvesting, purchasing, acquiring, exchanging, selling, or managing public funds, a trustee shall act with care, skill, prudence, and diligence under the circumstances then prevailing, including, but not limited to, the general economic conditions and the anticipated needs of the agency, that a prudent person acting in a like capacity and familiarity with those matters would use in the conduct of funds of a like character and with like aims, to safeguard the principal and maintain the liquidity needs of the agency. Within the limitations of this section and considering individual investments as part of an overall strategy, investments may be acquired as authorized by law. It is the SBWMA's full intent, at the time of purchase, to hold all investments until maturity to ensure the return of all invested principal dollars. However, it is realized that market prices of securities will vary depending on economic and interest rate conditions at any point in time. It is further recognized that in a well-diversified investment portfolio, occasional measured losses are inevitable due to economic, bond market or individual security credit analysis. These occasional losses must be considered within the context of the overall investment program objectives and the resultant long-term rate of return.




The Assistant City Manager and Administrative Services Director, Financial Services Manager, and Principal Analyst of the City of Redwood City (RWC) San Carlos (City) and other individuals assigned, as approved by the SBWMA Executive Director and SBWMA Senior Finance Manager to manage the SBWMA investment portfolio, acting within the intent and scope of the investment policy and other written procedures and exercising due diligence, shall be relieved of personal responsibility and liability for an individual security's credit risk or market price changes, provided deviations from expectations are reported in a timely manner and appropriate action is taken to control adverse developments. OBJECTIVES Safety of Principal Safety of principal is the foremost objective of the South Bayside Waste Management Authority. Each investment transaction shall seek to ensure that capital losses are avoided, whether from securities default, broker-dealer default or erosion of market value. The SBWMA shall seek to preserve principal by mitigating the two types of risk: credit risk and market risk. Credit risk, defined as the risk of loss due to failure of the issuer of a security, shall be mitigated by investing in investment grade securities and by diversifying the investment portfolio so that the failure of any one issuer does not unduly harm the SBWMA's capital base and cash flow. Market risk, defined as market value fluctuations due to overall changes in the general level of interest rates, shall be mitigated by limiting the average maturity of the SBWMA's investment portfolio to two years, the maximum maturity of any one security to five years, structuring the portfolio based on historic and current cash flow analysis eliminating the need to sell securities prior to maturity and avoiding the purchase of long term securities for the sole purpose of short term speculation. Liquidity Historical cash flow trends are compared to current cash flow requirements on an ongoing basis in an effort to ensure that the SBWMA's investment portfolio will remain sufficiently liquid to enable the SBWMA to meet all reasonably anticipated operating requirements. MATURITY MATRIX Maturities of investments will be selected based on liquidity requirements to minimize interest rate risk and maximize earnings. Current and expected yield curve analysis will be monitored and the portfolio will be invested accordingly. The weighted average maturity of the pooled portfolio should not exceed two years and the following percentages of the portfolio should be invested in the following maturity sectors: Maturity Range Suggested Percentage 1 day to 7 days 10 to 50% 7 days to 180 10 to 30% 180 days to 360 days 10 to 30% 1 year to 2 years 10 to 20% 2 years to 3 years 0 to 20% 3 years to 4 years 0 to 20% 4 years to 5 years 0 to 20% Over 5 years Board Authorization Required *




* One exception does exist regarding the investment of bond reserve funds. If, in the opinion of the Executive Director or the SBWMA Board of Directors, matching the segregated investment portfolio of the bond reserve fund with the maturity schedule of an individual bond issue is prudent given current economic analysis, the investment policy authorizes extending beyond the five year maturity limitation as outlined in this document. PERFORMANCE EVALUATION Investment performance is monitored and evaluated by the Investment Advisory Committee, whose membership is outlined in the following section. Investment performance statistics and activity reports are generated on a quarterly basis for presentation to the Investment Advisory Committee and to the SBWMA Board of Directors. Annually, a statement of investment policy, and any proposed changes to the policy, will be rendered to the Investment Advisory Committee and to the SBWMA Board of Directors for Board consideration at a public meeting. The SBWMA’s investment portfolio is designed to at least attain a market average rate of return through economic cycles. The market average rate of return is defined as average return on the Local Agency Investment Fund (assuming the State does not adversely affect LAIF’s returns due to budget constraints). DELEGATION OF AUTHORITY The Joint Powers Authority Agreement of the South Bayside Waste Management Authority and the authority granted by SBWMA Board assign the responsibility of investing unexpended cash to the City’s Assistant City Manager and Administrative Services Director or Principal Analyst. Daily management responsibility of the investment program may be delegated to the City’s Financial Services Manager, who shall establish procedures for the operation consistent with this investment policy. INVESTMENT OVERSIGHTCOMMITTEE The Assistant City Manager and Administrative Services Director, Financial Services Manager, and Principal Analyst (City Treasurer) of the City of Redwood City will provide general oversight and direction concerning the An investment committee consisting of the City of San Carlos Treasurer, City Manager, and Administrative Services Director shall be established to provide general oversight and direction concerning the policy related to management of the SBWMA's investments pool. In conjunction with the City’s investment advisory firm, Tthe Financial Services Manager shall not be a member of the committee but shall serve in a staff and advisory capacity. The committee shall review and approve quarterly investment reports prepared by the Finance Divisionepartment and reviewed by the Financial Services Manager or and meet as necessary to discuss changes to the report or the investment strategy. The SBWMA Board will be provided with Investment Committee serving as the legislative body of the Investment Policy will have the quarterly reports for their review within thirty (30) days following the end of the quarter covered by the report as per Section 53646 (b)(1) of the California Government Code. ETHICS AND CONFLICTS OF INTEREST Officers and employees involved in the investment process shall refrain from personal business activity that conflicts with proper execution of the investment program, or impairs their ability to make




impartial investment decisions. Additionally the City’s Assistant City Manager and Administrative Services Director and the Financial Services Manager are required to annually file applicable financial disclosures as required by the Fair Political Practices Commission (FPPC). SAFEKEEPING OF SECURITIES To protect against fraud or embezzlement or losses caused by collapse of an individual securities dealer, all securities owned by the SBWMA shall be held in safekeeping by a third party bank trust department, acting as agent for the SBWMA under the terms of a custody agreement. All trades executed by a dealer will settle delivery versus payment (DVP) through the SBWMA's safekeeping agent. Securities held custody for the SBWMA shall be monitored by the City’s Financial Administrative Services Manager Director to verify investment holdings. All exceptions to this safekeeping policy must be approved by the City’s Financial Administrative Services Manager Director in written form and included in the quarterly reporting to the Investment Committee and the SBWMA Board of Directors. INTERNAL CONTROL Separation of functions between the City’s Administrative Services Director or Financial Services Manager and/or the Principal Analyst, Senior Accountant, Accountant, Account Technician, and/or Account Clerk is designed to provide an ongoing internal review to prevent the potential for converting assets or concealing transactions. Investment decisions are made by the City’s FinancialAdministrative Services ManagerDirector, executed by the Principal Analyst, Administrative Services Director or Financial Services Manager and confirmed by the Senior Accountant, Accountant, Account Technician, and/or Account Clerk. All wire transfers initiated by the Accountant or Account TechnicianAdministrative Services Director or Financial Services Manager must be reconfirmed by the appropriate financial institution to the Financial Services ManagerSenior Accountant. Proper documentation obtained from confirmation and cash disbursement wire transfers is required for each investment transaction. Timely bank reconciliation is conducted to ensure proper handling of all transactions. The investment portfolio and all related transactions are reviewed and balanced to appropriate general ledger accounts by the Account TechnicianSenior Accountant on a monthly basis. An independent analysis by an external auditor shall be conducted annually to review and perform procedure testing on the Agency’s cash and investments that have a material impact on the financial statements. The FinancialAdministrative Services ManagerDirector and/or Investment Committee shall review and assure compliance with investment process and procedures. REPORTING The City’s Financial Administrative Services Manager Director shall review and render quarterly reports to the Investment Advisory Committee and to the Board of Directors which shall include the face amount of the cash investment, the classification of the investment, the name of the institution or entity, the rate of interest, the maturity date, the current market value and accrued interest due




for all securities. The quarterly reports will be submitted to the Board of DirectorsInvestment Committee within thirty (30) days following the end of the quarter covered by the report as per Section 53646 (b)(1) of the California Government Code. Once approved by the Investment Committee, the quarterly reports shall be placed on the Board of Director’s meeting agenda for its review and approval no later than 60 days after the quarter ends. If there are no Board of Director meetings within the 360-day period, the quarterly report shall be presented to the Board of Directors at the soonest possible meeting thereafter. QUALIFIED BROKER/DEALERS The SBWMA shall transact business only with banks, savings and loans, and with broker/dealers. The broker/dealers should be primary or regional dealers. The City currently does not maintain a list of broker/dealers approved to do business with the City. When necessary, the City shall go through the Request for Proposal processes to select the broker/dealers. The City’s Administrative Services Director will make exceptions only upon written authorization. Investment staff shall investigate dealers wishing to do business with the SBWMA to determine if they are adequately capitalized, have pending legal action against the firm or the individual broker and make markets in the securities appropriate to the SBWMA's needs. The SBWMA’s investment policy shall be made available on the Authority’s website for broker/dealers’ review. COLLATERAL REQUIREMENTS Collateral is required for investments in certificates of deposit. In order to reduce market risk, the collateral level will be at least 110% of market value of principal and accrued interest. ENVIRONMENTALLY RESPONSIBLE INVESTING When possible, the Authority will invest in companies that demonstrate verifiable environmental stewardship policies that align with the SBWMA’s Triple Zero goals. These goals are identified in the Authority’s 2020 Long Range Plan-Guiding Principles and Objectives. They are:

1. Eliminate the disposal of recyclable materials at landfills

2. Eliminate the disposal of organic materials at landfills

3. Minimize Agency greenhouse gas emissions (through measures such as using low-emission vehicle fuels and reducing the need for materials collection and transfer of materials).

These goals will allow the Authority’s environmental responsible asset investment to strategically align with its mission, and with its Member Agencies’ own environmental visions. AUTHORIZED INVESTMENTS Investment of SBWMA funds is governed by the California Government Code Sections 53600 et seq. Within the context of the limitations, the following investments are authorized, as further limited herein:

Commented [JM1]: Added Environmental Investing




1. United States Treasury Bills, Bonds, and Notes or those for which the full faith and credit of the United States are pledged for payment of principal and interest. There is no percentage limitation of the portfolio that can be invested in this category, although a five-year maturity limitation is applicable.

2. Local Agency Investment Fund (LAIF) which is a State of California managed investment pool, and San Mateo County Investment pool, may be used up to the maximum permitted by California State Law. A review of the pool/fund is required when they are part of the list of authorized investments, with the knowledge that the pool/fund may include some investments allowed by statute but not explicitly identified in this investment policy.

3. Federal agency or United States government-sponsored enterprise obligations,

participations, or other instruments, including those issued by or fully guaranteed as to principal and interest by federal agencies or United States government-sponsored enterprises. There is no percentage limitation of the portfolio that can be invested in this category, although a five-year maturity limitation is applicable.

3. Most mortgage-backed securities are oObligations issued by the Government National Mortgage Association (GNMA), the Federal Farm Credit System (FFCB), the Federal Home Loan Bank Board (FHLB), the Federal National Mortgage Association (FNMA), the Student Loan Marketing Association (SLMA), and the Federal Home Loan Mortgage Corporation (FHLMC). There is no percentage limitation of the portfolio that can be invested in this category, although a five-year maturity limitation is applicable.A mortgage passthrough security, collateralized mortgage obligation, mortgage-backed or other pay-through bond, equipment lease-backed certificate, consumer receivable passthrough certificate, or consumer receivable-backed bond of a maximum of five years’ maturity. Securities eligible for investment under this subdivision shall be issued by an issuer rated in a rating category of “A” or its equivalent or better for the issuer’s debt as provided by an NRSRO and rated in a rating category of “AA” or its equivalent or better by an NRSRO. Purchase of securities authorized by this subdivision shall not exceed 20 percent of the agency’s surplus moneys that may be invested pursuant to this section.

4. Bills of exchange or time drafts drawn on and accepted by commercial banks, otherwise

known as banker's acceptances. Banker's acceptances purchased may not exceed 180 days to maturity or 40% of the cost value of the portfolio. Also, no more than 30% of the agency’s money may be in bankers’ acceptances of any one commercial bank.

5. Commercial paper ranked the highest letter and number rating by a nationally recognized

statistical rating organization (NRSRO), such as Standard and Poor’s Ratings Services, Fitch Ratings, Inc. or Moody’s Investors Services, , and issued by domestic corporations having assets in excess of $500,000,000 and having an rating in the rating category of “A” or the equivalent or better rating on its' long term debentures as provided by NRSRO. Purchases of eligible commercial paper may not exceed 270 days to maturity nor represent more than 10510% of the outstanding paper of the issuing corporation. Purchases of commercial paper may not exceed 25% of the cost value of the portfolio. No more than 5% of the market value of the portfolio may be invested in any one issuer.

6. Negotiable Certificates of Deposit issued by nationally or state chartered banks (FDIC

insured institutions), a savings association or a federal association (as defined by Section 5102 of the Financial Code), a state or federal credit union, or by a federally licensed or

Commented [AK2]: Language from Code to replace paragraph below.

Commented [FR3R2]: This should be sufficient and includes agency mortgage-backed securities.

Commented [AK4]: I recommend deleting this paragraph to replace it with the paragraph added above, which is directly from Code and allows investment in federal agencies.

Commented [AK5]: The Code language added here applies to non-agency mortgage backed securities and asset-backed securities 53601(o). It is my assumption that this policy wants to permit investment in agency mortgage backed securities only (which are permitted by the language I added). As such, I recommend deleting this language.

Commented [FR6R5]: I don’t believe you want non-agency mortgage backed securities, so this should be deleted.

Commented [AK7]: Language more in line with Code

Commented [AK8]: I recommend leaving this at 10%, per Code.

Commented [AK9]: Language added to address what I think you were trying to accomplish by changing 10% to 5% in prior sentence.




state-licensed branch of a foreign bank. or state or federal savings institutions. Purchases of negotiable certificates of deposit may not exceed 30% of total portfolio. A maturity limitation of five years is applicable. No more than 5% of the market value of the portfolio may be invested in any one issuer.

7. Time deposits, non-negotiable and collateralized in accordance with the California

Government Code, may be purchased through banks or savings and loan associations. Since time deposits are not liquid, no more than 30% of the investment portfolio may be invested in this investment type. A maturity limitation of five years is applicable.

8. Medium Term Corporate Notes, with a maximum maturity of five years may be purchased.

Securities eligible for investment shall be rated in a rating category of “A” or the equivalent or better by an NRSRO. Purchase of medium term notes may not exceed 30% of the market value of the portfolio and no more than 5% of the market value of the portfolio may be invested in notes issued by one corporation. Commercial paper holdings should also be included when calculating the 1510% limitation.

9. Ineligible investments are those that are not described herein, including but not limited to,

common stocks and long term (over five years in maturity) notes and bonds are prohibited from use in this portfolio. It is noted that special circumstances arise that necessitate the purchase of securities beyond the five-year limitation. On such occasions, requests must be approved by Board of Directors prior to purchase.

10. Various daily money market funds administered for or by trustees, paying agents and

custodian banks contracted by the SBWMA may be purchased as allowed under State of California Government Code. Only funds holding U.S. Treasury or Government agency obligations can be utilized.

The following summary of maximum percentage limits, by instrument, is established for the SBWMA's total pooled funds portfolio:

Authorized Investment Type

Government Code

Maximum Maturity

Minimum Credit

Quality Maximum in

Portfolio

Maximum Investment

in One Issuer

Local Agency Investment Fund (LAIF)

16429.1 Upon

Demand N/A

50% to 70% of the investment portfolio, as approved by the SBWMA Board but no more than $675 million permitted by LAIF

N/A

San Mateo County Investment Pool

53684 Upon

Demand N/A

30% to 50% of the investment portfolio, as approved by the SBWMA Board

N/A

Commented [AK10]: Added this language per Code

Commented [AK11]: Suggest adding this language to increase safety and it is consistent with the requirement for other credit sectors in the policy.

Commented [AK12]: LAIF increased the limit to $75 million effective January 1, 2020. You may want to consider changing this to $75 million.

Commented [FR13R12]: agree




Treasury Obligations (bills, notes & bonds)

53601(b) 5 Years N/A 100% N/A

US Government Agency and Federal Agency Securities

53601(f) 5 Years N/A 100% N/A

Mortgage Pass-Through Securities or Mortgage-Backed Securities

53601(o) 5 Years (AC) 20% N/A

Bankers’ Acceptances

53601(g) 180 Days N/A 40% 30%

Commercial Paper 53601(h) 270 Days

Highest letter and number

rating by an

NRSRO

25% 5%

Negotiable Certificates of Deposit

53601(i) 5 Years N/A 30% 5%

Time Certificates of Deposit – Banks or Savings and Loans

53601.8 5 Years N/A 30% N/A

Medium Term Corporate Notes

53601(k) 5 Years

Rating category “A” by NRSRO

30% 5%

(A) 10% of outstanding paper of issuing corporation. and 10% of the portfolio in one

corporation No more than 30% of the agency’s money may be in bankers’ acceptances of any one

commercial bank. (B) Issued by an issuer rated in a rating category of “A” or its equivalent or better for the

issuer’s debt as provided by an NRSRO and rated in a rating category of “AA” or its equivalent or better by an NRSRO.

DERIVATIVE INVESTMENTS Derivatives are investments whose value is "derived" from a benchmark or index. That benchmark can be almost any financial measure from interest rates to commodity and stock prices. The use of derivatives is prohibited under this policy. LEGISLATIVE CHANGES Any State of California legislative action that further restricts allowable maturities, investment type, or percentage allocations will be incorporated into the South Bayside Waste Management Authority's Investment Policy and supersede any and all previous applicable language. INTEREST EARNINGS

Commented [AK14]: I recommend deleting this. I don’t believe they want to add non-agency MBS/asset-backed securities as a permitted investment. However, if they do, we will need to add the language above.

Commented [AK15]: I think this should be deleted.

Commented [FR16R15]: Seems out of place

Commented [FR17]: Delete if deleting mortgage-backed securities.




All moneys earned and collected from investments authorized in this policy shall be allocated quarterly to various fund accounts based on the cash balance in each fund at quarter end as a percentage of the entire pooled portfolio. LIMITING MARKET VALUE EROSION The longer the maturity of securities, the greater their market price volatility. Therefore, it is the general policy of the SBWMA to limit the potential effects from erosion in market values by adhering to the following guidelines: All immediate and anticipated liquidity requirements will be addressed prior to purchasing all investments. Maturity dates for long-term investments will coincide with significant cash flow requirements where possible, to assist with short term cash requirements at maturity. All long-term securities will be purchased with the intent to hold all investments to maturity under then prevailing economic conditions. However, economic or market conditions may change, making it in the SBWMA's best interest to sell or trade a security prior to maturity. PORTFOLIO MANAGEMENT ACTIVITY The investment program shall seek to augment returns consistent with the intent of this policy, identified risk limitations and prudent investment principals. These objectives will be achieved by use of the following strategies: Active Portfolio Management. Through active fund and cash flow management, taking advantage of current economic and interest rate trends, the portfolio yield may be enhanced with limited and measurable increases in risk by extending the weighted maturity of the total portfolio. Portfolio Maturity Management. When structuring the maturity composition of the portfolio, the SBWMA shall evaluate current and expected interest rate yields and necessary cash flow requirements. It is recognized that in normal market conditions longer maturities produce higher yields. However, the securities with longer maturities also experience greater price fluctuations when the level of interest rates change. Security Swaps. The SBWMA may take advantage of security swap opportunities to improve the overall portfolio yield. A swap, which improves the portfolio yield, may be selected even if the transactions result in an accounting loss. Documentation for swaps will be included in the SBWMA permanent investment file documents. Competitive Bidding. It is the policy of the SBWMA to require competitive bidding for investment transactions that are not classified as "new issue" securities. For the purchase of non-"new issue" securities and the sale of all securities at least three bidders must be contacted. Competitive bidding for security swaps is also suggested, however, it is understood that certain time constraints and broker portfolio limitations exist which would not accommodate the competitive bidding process. If a time or portfolio constraining condition exists, the pricing of the swap should be verified to current market conditions and documented for auditing purposes.




POLICY REVIEW The South Bayside Waste Management Authority's investment policy shall be adopted by resolution of the Board on an annual basis. This investment policy shall be reviewed at least annually to ensure its consistency with the overall objectives of preservation of principal, liquidity and yield, and its relevance to current law and financial and economic trends. Any amendments to the policy shall be forwarded to Board for approval. Glossary of Terms Accrued Interest- Interest earned but not yet received. Active Deposits- Funds which are immediately required for disbursement. Amortization- An accounting practice of gradually decreasing (increasing) an asset's book value by spreading its depreciation (accretion) over a period of time. Annual Financial Report - The official annual financial report for the SBWMA. It includes five combined statements and basic financial statements for each individual fund and account group prepared in conformity with Generally Accepted Accounting Principles (GAAP). Asked Price- The price a broker dealer offers to sell securities. Basis Point- One basis point is one hundredth of one percent (.01). Bid Price- The price a broker dealer offers to purchase securities. Bond- A financial obligation for which the issuer promises to pay the bondholder a specified stream of future cash flows, including periodic interest payments and a principal repayment. Bond Swap – Selling one bond issue and buying another at the same time in order to create an advantage for the investor. Some benefits of swapping may include tax-deductible losses, increased yields, and an improved quality portfolio. Book Entry Securities – Securities, such stocks held in “street name,” that are recorded in a customer’s account, but are not accompanied by a certificate. The trend is toward a certificate-free society in order to cut down on paperwork and to diminish investors’ concerns about the certificates themselves. All the large New York City banks, including those that handle the bulk of the transactions of the major government securities dealers, now clear most of their transactions with each other and with the Federal Reserve through the use of automated telecommunications and the “book-entry” custody system maintained by the Federal Reserve Bank of New York. These banks have deposited with the Federal Reserve Bank a major portion of their government and agency securities holdings, including securities held for the accounts of their customers or in a fiduciary capacity. Virtually all transfers for the account of the banks, as well as for the government securities dealers who are their clients, are now effected solely by bookkeeping entries. The system reduces the costs and risks of physical handling and speeds the completion of transactions. Bearer and Registered Bonds - In the past, bearer and registered bonds were issued in paper form. Those still outstanding may be exchanged at any Federal Reserve Bank or branch for an equal amount of any authorized denomination of the same issue. Outstanding bearer bonds are




interchangeable with registered bonds and bonds in “book-entry” form. That is, the latter exist as computer entries only and no paper securities are issued. New bearer and registered bonds are no longer being issued. Since August 1986, the Treasury’s new issues of marketable notes and bonds are available in book-entry form only. All Treasury bills and more than 90% of all other marketable securities are now in book-entry form. Book-entry obligations are transferable only pursuant to regulations prescribed by the Secretary of the Treasury. Book Value- The value at which a debt security is shown on the holder's balance sheet. Book value is acquisition cost less amortization of premium or accretion of discount. Broker – In securities, the intermediary between a buyer and a seller of securities. The broker, who usually charges a commission, must be registered with the exchange in which he or she is trading, accounting for the name registered representative. Certificate of Deposit- A deposit insured up to $250,000 by the FDIC at a set rate for a specified period of time. Collateral- Securities, evidence of deposit or pledges to secure repayment of a loan. Also refers to securities pledged by a bank to secure deposit of public moneys. Constant Maturity Treasury (CMT) - An average yield of a specific Treasury maturity sector for a specific time frame. This is a market index for reference of past direction of interest rates for the given Treasury maturity range. Coupon- The annual rate of interest that a bond's issuer promises to pay the bondholder on the bond's face value. Credit Analysis- A critical review and appraisal of the economic and financial conditions or of the ability to meet debt obligations. Current Yield- The interest paid on an investment expressed as a percentage of the current price of the security. Custody- A banking service that provides safekeeping for the individual securities in a customer's investment portfolio under a written agreement which also calls for the bank to collect and pay out income, to buy, sell, receive and deliver securities when ordered to do so by the principal. Delivery vs. Payment (DVP) - Delivery of securities with a simultaneous exchange of money for the securities. Discount- The difference between the cost of a security and its value at maturity when quoted at lower than face value. Diversification- Dividing investment funds among a variety of securities offering independent returns and risk profiles. Duration- The weighted average maturity of a bond's cash flow stream, where the present value of the cash flows serve as the weights; the future point in time at which on average, an investor has received exactly half of the original investment, in present value terms; a bond's zero-coupon equivalent; the fulcrum of a bond's present value cash flow time line.




Fannie Mae- Trade name for the Federal National Mortgage Association (FNMA), a U.S. sponsored corporation. Federal Reserve System- The central bank of the U.S. that consists of a seven member Board of Governors, 12 regional banks and approximately 3,000 commercial banks that are members. Federal Deposit Insurance Corporation (FDIC) - Insurance provided to customers of a subscribing bank that guarantees deposits to a set limit (currently $250,000) per account. Fed Wire- A wire transmission service established by the Federal Reserve Bank to facilitate the transfer of funds through debits and credits of funds between participants within the Fed system. Freddie Mac- Trade name for the Federal Home Loan Mortgage Corporation (FHLMC), a U.S. sponsored corporation. Ginnie Mae- Trade name for the Government National Mortgage Association (GNMA), a direct obligation bearing the full faith and credit of the U.S. Government. Inactive Deposits- Funds not immediately needed for disbursement. Interest Rate- The annual yield earned on an investment, expressed as a percentage. Investment Agreements- An agreement with a financial institution to borrow public funds subject to certain negotiated terms and conditions concerning collateral, liquidity and interest rates. Liquidity- Refers to the ability to rapidly convert an investment into cash. Market Value- The price at which a security is trading and could presumably be purchased or sold. Maturity- The date upon which the principal or stated value of an investment becomes due and payable. Nationally Recognized Statistical Rating Organizations (NRSRO): A U.S. Securities & Exchange Commission registered agency that assesses the creditworthiness of an entity or specific security. NRSRO typically refers to Standard and Poor’s Ratings Services, Fitch Ratings, Inc. or Moody’s Investors Services. New Issue- Term used when a security is originally "brought" to market. Perfected Delivery- Refers to an investment where the actual security or collateral is held by an independent third party representing the purchasing entity. Portfolio- Collection of securities held by an investor. Primary Dealer- A group of government securities dealers that submit daily reports of market activity and security positions held to the Federal Reserve Bank of New York and are subject to its informal oversight. Purchase Date- The date in which a security is purchased for settlement on that or a later date.




Rate of Return- The yield obtainable on a security based on its purchase price or its current market price. This may be the amortized yield to maturity on a bond or the current income return. Repurchase Agreement (REPO) - A transaction where the seller (bank) agrees to buy back from the buyer (SBWMA) the securities at an agreed upon price after a stated period of time. Reverse Repurchase Agreement (REVERSE REPO) - A transaction where the seller (SBWMA) agrees to buy back from the buyer (bank) the securities at an agreed upon price after a stated period of time. Risk- Degree of uncertainty of return on an asset. Safekeeping- see custody. Sallie Mae- Trade name for the Student Loan Marketing Association (SLMA), a U.S. sponsored corporation. Secondary Market- A market made for the purchase and sale of outstanding issues following the initial distribution. Settlement Date- The date on which a trade is cleared by delivery of securities against funds. Time Deposit – A deposit in an interest-paying account that requires the money to remain on account for a specific length of time. While withdrawals can generally be made from a passbook account at any time, other time deposits, such as certificates of deposit, are penalized for early withdrawal. Treasury Obligations- Debt obligations of the U.S. Government that are sold by the Treasury Department in the forms of bills, notes, and bonds. Bills are short-term obligations that mature in one year or less. Notes are obligations that mature between one year and ten years. Bonds are long-term obligations that generally mature in ten years or more. U.S. Government Agencies- Instruments issued by various US Government Agencies most of which are secured only by the credit worthiness of the particular agency. Yield- The rate of annual income return on an investment, expressed as a percentage. It is obtained by dividing the current dollar income by the current market price of the security. Yield to Maturity- The rate of income return on an investment, minus any premium or plus any discount, with the adjustment spread over the period from the date of purchase to the date of maturity of the bond, expressed as a percentage. Yield Curve- The yield on bonds, notes or bills of the same type and credit risk at a specific date for maturities up to thirty years.


7

Proposed Work Plan Transitioning the South Bayside Waste Management Authority’s Financial Systems from a Fiscal Year Accounting Period Ending

June 30, to Calendar Year Accounting Period Ending

December 31

Agenda Item 7



_________________________________________________________________________________________________________________ Finance Committee Meeting – 05/12/2020 AGENDA ITEM: 7 - p1

7

STAFF REPORT To: SBWMA Board Members From: John Mangini, Senior Finance Manager Date: May 12, 2020 Finance Committee Meeting Subject: Proposed Work Plan Transitioning the South Bayside Waste Management Authority’s Financial

Systems from a Fiscal Year Accounting Period Ending June 30, to Calendar Year Accounting Period Ending December 31.

Board Action It is recommended that the SBWMA Board of Directors approve Resolution No. 2020-XX attached hereto authorizing the following action:

Approve transitioning from Fiscal Year Accounting Period Ending June 30, to Calendar Year Accounting Period Ending December 31, commencing on January 1, 2021.

Summary Staff is presenting this Work Plan to transition from the SBWMA’s current Fiscal Year-based Accounting Period ending June 30, to a Calendar Year-based Accounting Period beginning January 1, 2021. The purpose of this transition is to align the Authority’s Budget Year with its Member Agency’s rate year format, and the Authority’s major vendor contracts, which are all based on a calendar year. Those contracts include the collection operation’s franchise agreement through December 31, 2035 (Recology); the Shoreway facility’s operations agreement through December 31, 2023 (SBR); and the authority’s major disposal and processing contracts. With all major expenses being based on a calendar year, it is sensible and logical to align the Authority’s accounting period and budget cycle to the same time period.

Analysis It has been a longstanding aspiration of the Board, the Finance Committee, TAC members, and Staff to transition the Authority’s financial and reporting systems from a Fiscal Year Accounting Period ending June 30 to Calendar Year Accounting Period, to better align with the Authority’s major contracts and Member Agency’s rate-setting calendars which all operate on a calendar year basis, including:

• Each Member Agency’s annual SBWMA System Revenue Requirement is calculated on a calendar year,and all Member Agencies set rates for their rate payers on a calendar year to meet their Proposition 218noticing requirements.

• The annual Compensation Application Adjustment review process for the Member Agency’s collectionfranchise agreements with Recology and the facility operations agreement with South Bay Recycling areboth performed on a calendar year basis.

• The Authority’s disposal rates with Ox Mountain Landfill (MSW) and material processing rates with Newby(Organics), Blossom Valley North (Organics) and Zanker (C&D) are all contractually adjusted on acalendar year.


Finance Committee - 05/12/2020 AGENDA ITEM: 7 - p2

• The Authority’s bond covenant test and reporting are all conducted on a calendar year basis.

The Work Plan The plan includes creating an abbreviated, one-time transitional six-month fiscal year for the period of July 1, 2020 to December 31, 2020. Staff considered both a six-month fiscal year and an eighteen-month fiscal year to execute the transition to a calendar year accounting period. Our external auditors, Maze & Associates, and our accounting services team, Redwood City, have recommended and support utilizing a six-month fiscal year period to transitional into a calendar-based fiscal year format. Staff will present both a six-month DRAFT budget (July 1, 2020 to December 31, 2020) and a full year budget (July 1, 2020 to June 30, 2021) to the Board for review during this May BOD Meeting, and a FINAL Budget for consideration at the June BOD Meeting. A full year budget (July 1, 2020 to June 30, 2021) is being presented for consideration due to the need to estimate January 1, 2021 tipping fees at the Shoreway Facility. Estimated tipping fees are used to calculate Member Agencies Revenue Requirement for 2021 which will be performed in the fall of 2020. The close of current Fiscal Year ending June 30, 2020 will occur per the current normal cycle, and be presented to the Board for approval in January 2021. Staff will present a calendar year budget (January 1, 2021 to December 31, 2021) to the Board for review in October and for approval at the November BOD Meeting. It is currently envisioned that the October Budget review will be in the form of a Board/TAC Study Session. At the end of calendar year 2020 the City of Redwood City’s Accounting Services staff will perform the accounting close of the six-month fiscal year and compile the Authority’s Financial Results for independent audit review and opinion. It is anticipated that the audited financials for this period will be presented to the Board for approval in June 2021. A chart of accounting period timelines can be found in Attachment A. Staff will report audited financials to the various governing bodies as required. Impacts The change to a calendar year accounting period will shift Staff’s budget workload from the spring to the fall of each year. This may require the need for added Staff support in the from of a consultant or temporary staffing, as the Authority’s review of Contractor’s Compensation Application Adjustment occurs in the late summer and fall months, and the calculation of Member Agency Revenue Requirement also occurs in the fall. The Authority’s independent auditors, Maze & Associates, have advised that the change will not impact their ability to perform the financial audit. The change moves their work to the first half of each calendar year, which is a lighter period in the firm’s work cycle. The impact on Redwood City’s Accounting Services Team is minimal to none (confirmed by the unit manager). They merely need to perform an additional close for the six-month period and move their period closing work from the July/August time period to a January/February time period. The accounting services contract with the City of Redwood City contains a cost of $4,430 to perform the close on the one-time, six-month transitional period.


Finance Committee - 05/12/2020 AGENDA ITEM: 7 - p3

Fiscal Impact Cost for the City of Redwood City to perform a six-month period close is $4,300. Potential added Staff support during high workload period is estimated to cost $25,000 annually.

Attachments: Resolution 2020-XX To be included with 05/28/2020 Board PacketAttachment A – Timeline Chart


Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3

Fiscal Year 2019/2020Budget BOD Approval BODFiscal Year 2019/2020Audit PeriodAudited Financials (BOD Approval) BOD

Fiscal Year 2020/2021Budget BOD Approval BODFiscal Year 2020/2021Audit Period NoneAudited Financials (BOD Approval) None

Fiscal Year ‐ Jul 2020 to Dec 2020Budget BOD Approval BODFiscal Year ‐ Jul 2020 to Dec 2020Audit PeriodAudited Financials (BOD Approval) BOD

Fiscal Year 2021 (Calendar Year)Budget BOD Approval BODFiscal Year 2021Audit PeriodAudited Financials (BOD Approval) BOD

SBWMA Fiscal Year & Calendar Year Accounting Period Alignment

Audit Period

Audit Period

Calendar Year Quarter2020 2021 2022

Audit Period

2019

_________________________________________________ SBWMA FINANCE COMMITTEE PACKET 05/12/2020

____________________________________________________ __________________________________________________________ AGENDA ITEM: 7 ATTACHMENT A - p1


8

Review Property Insurance Renewal

Agenda Item 8



________________________________________________________________________________________________________________ SBWMA FINANCE COMMITTEE MEETING 05/12/2020 AGENDA ITEM: 8 - p1

8

STAFF REPORT To: SBWMA Board Members From: Joe La Mariana, Executive Director

John Mangini, Senior Finance Manager Date: May 12, 2020 Finance Committee Meeting Subject: Review Property Insurance Renewal

Recommendation This is a discussion item only and no action is required.

Summary Staff has been awaiting the FY20/21 property insurance quotes from the Agency’s Broker, Risk Strategies (RS). RS began submitting requests for quotes from carriers in mid-March and to date we have only received quotes for the first insurance layer ($10M of $60M). RS has been proactive communicating with the SBWMA, but independent carriers have not been as timely with their responses as we would hope. This timing s is consistent with the process a year ago, but we have also been advised that some of this delay is because several insurers have opted out this year so additional insurers are being solicited.

Current Premium Quotes: The first layer premium quote is 43% higher than the current 2019/2020 premium with a $1M deductible. The last three years have posted record-setting national claims that have rocked the insurance industry due to many catastrophic wildfires, floods and other disasters. RS’ staff has advised agency Staff that these imposing premium increases are occurring society-wide to mitigate sector-risk and build insurance industry reserves to fund future claims. Staff has requested that RS CEO, John O’Neill, be available during this Finance Committee meeting on May 12th. As of this writing, we await confirmation of Mr. O’Neill’s attendance.

It is difficult to estimate the expected premium quotes for the additional layers, although if all layers increase by the same 43%, the total 20/21 premium would be $1.3M. See Attachment A – 2019 & 2020 Property Insurance Detail for a comparative of the 19/20 and estimated 20/21 premium. The first layer insurance quote can be found on Attachment B.

Staff also requested quotes for $500K deductible and are also awaiting those results. Upon seeing the aforementioned premiums, Staff will also request pricing for a $2M deductible coverage product. Staff anticipates that these optional prices will be available by May 12th for Finance Committee discussion.

Background At its May 23rd, 2019 Board of Directors Meeting the SBWMA Board approved the property insurance policy renewal with a group of insurance companies for a total premium of $1,078,100 plus finance charges of $26,225. Prior to this approval the Board requested Staff to investigate the premium cost savings with an increased



deductible over the $500K deductible and present the costs for consideration at the June 27th, 2019 Board Meeting. Staff consulted with Risk Strategies who is marketing the SBWMA’s property insurance coverage of the buildings and equipment at the Shoreway facility. Risk Strategies requested quotes from the insurance carriers for premium costs with deductibles of $750K and $1M. The SBWMA Finance Committee convened via conference call on June 12th, 2019 to review the premium/deductible options and recommends the $1M deductible option with a premium cost savings of $114K versus the $500K deductible option. The Finance Committee advised that maintaining a budgeted $4.6M Emergency Reserve provides a level of self-insurance in the event of claim. Additionally, the Finance Committee recommended increasing the Emergency Reserve by the $114K savings. At the June 27th BOD Meeting the Board Approved Resolution No. 2019-41 Insurance Policy renewal for FY19/20 with a premium of $964,117 plus finance charges of up to $26,225 with a $1M deductible. The value of the Shoreway property and equipment is insured at $60 million. The SBWMA does not have Earthquake insurance because of the high premium, high deductible and limited coverage. In addition, the Agency maintains an Emergency Reserve that would help to offset an earthquake event.

Attachments Attachment A - 2019 & 2020 Property Insurance Detail for a comparative of the 19/20 and estimated 20/21 premium Attachment B – FY20/21 First Layer Insurance Quote


SBWMA Property Insurance Detail - 2019 & 2020

Policy Layers Status Coverage Premium

Primary Layer, Part I Actual 5,000,000 283,640$ Primary Layer, Part II Actual 5,000,000 283,640$

First Excess Layer, Part I Actual 5,000,000 63,741$ First Excess Layer, Part II Actual 5,000,000 63,741$

Second Excess Layer Actual 10,000,000 84,334$

Third Excess Layer, Part I Actual 15,000,000 77,900$ Third Excess Layer, Part II Actual 15,000,000 77,900$

2019 Total All Layers * Actual 60,000,000 934,897$ * Excludes Equipment Replacement coverage of $20K

Policy Layers Status Coverage Premium

Primary Layer, Part I Quoted 5,000,000 405,013$ Primary Layer, Part II Quoted 5,000,000 405,013$

First Excess Layer, Part I Estimate 5,000,000 91,017$ First Excess Layer, Part II Estimate 5,000,000 91,017$

Second Excess Layer Estimate 10,000,000 120,421$

Third Excess Layer, Part I Estimate 15,000,000 111,234$ Third Excess Layer, Part II Estimate 15,000,000 111,234$

2020 Total All Layers - Estimate * Estimate 60,000,000 1,334,949$ * Excludes Equipment Replacement coverage of $25K

2019 Property Insurance ($1M Deductible)

2020 Property Insurance ($1M Deductible)


Var to Prior year

43%43%

43%43%

43%

43%43%

43%


2020 Property Insurance

For:

South Bayside Waste Management Authority

Exec: John D O'Neill | Rep: June Tong | May 4, 2020


____________________________________________________ __________________________________________________________ AGENDA ITEM: 8 ATTACHMENT B - p1


2020 Property ‐ Insurance Summary For: South Bayside Waste Management Authority Exec: John D O'Neill | Rep: June Tong | May 4, 2020

This is a summary of your insurance coverage and is provided as a convenience to facilitate your understanding of your insurance coverage. This document does not include all of the coverage terms, conditions, limitations and exclusions and it is not intended to replace or supersede your insurance policies. You should review your entire policy carefully. This document is provided for informational purposes only and does not create a binding contract. RSC Insurance Brokerage, Inc. makes no representation that the coverage purchased addresses all potential risks and makes no statement about the adequacy of the liability limits herein. CA License#: 0F06675

Page 2 of 18

Table of Contents

Introduction

Named Insured

Risk Strategies Company Service Team

When To Notify Risk Strategies Company

Loss Experience

2019 and 2020 Property Values

Expiring 2019 Policies in Layers

2020 Policies in Layers with optional deductibles of $500,000 and $1,000,000

Marketing Survey

Coverage Considerations

Office Locations





This is a summary of your insurance coverage and is provided as a convenience to facilitate your understanding of your insurance coverage. This document does not include all of the coverage terms, conditions, limitations and exclusions and it is not intended to replace or supersede your insurance policies. You should review your entire policy carefully. This document is provided for informational purposes only and does not create a binding contract. RSC Insurance Brokerage, Inc. makes no representation that the coverage purchased addresses all potential risks and makes no statement about the adequacy of the liability limits herein. CA License#: 0F06675 Page 3 of 18

Introduction

Risk Strategies Company is a privately‐held, national insurance brokerage firm with over 20 office locations. Ranked in the top 25 brokers in the US, we offer sophisticated risk management, property & casualty and employee benefits advice and insurance placement. We serve companies of all sizes, non‐profits, public entities, and individuals, and have access to all major insurance markets.

Beyond providing traditional risk management advice and insurance management services, we bring value to our clients by offering a differentiated approach. At Risk Strategies Company, this means:

Client focus ‐ We have a passion for finding creative, cost‐effective risk solutions that meet the specific needs and circumstances of each and every client.

Teamwork and an entrepreneurial approach – This is core to how we work.

Deep expertise and “A team” talent ‐ We are confident in our ability to understand your business and deliver the highest quality services available in the risk management brokerage industry.

Independence and objectivity ‐ We conduct each client engagement with an unbiased view, challenging conventional methods and where appropriate, developing alternatives to traditional solutions.

Execution and focus ‐ Practicality and execution are as important as designing sound strategy. After developing the right risk management approach, Risk Strategies Company utilizes the proper resources in order to deliver an effective solution.

We understand risk and how to manage it. We are creative in approach and practical in execution. Most importantly, we care passionately about our clients and are fully invested in their success.






Named Insured

Named Insured: South Bayside Waste Management Authority Mailing Address: 610 Elm Street, Suite 202

San Carlos, CA 94070 Phone: (650) 802‐3500

RSC Service Team

RSC SERVICE TEAM FOR SOUTH BAYS IDE WASTE MANAGEMENT AUTHORITY

Client Executive: John D O'Neill, AIA, ARM (650)762‐0403

joneill@risk‐strategies.com

Account Executive: June Tong, CISR (650)762‐0413 jtong@risk‐strategies.com

Account Assistant: Lee Lebherz, CLCS, CISR

(650)425‐3023 llebherz@risk‐strategies.com

Servicing Office: Risk Strategies Company

700 Airport Blvd., Suite 300 Burlingame CA 94010 (650)762‐0400 phone (650)762‐0490 fax






When to Contact Us It is important that you advise us of any material changes in your operation which may have a bearing on your insurance program. Your insurers have evaluated and accepted the risks on the basis of information given. Any variation of these details could lead to complication in the event of a loss. These changes may include, but are not limited to: Change in ownership status.

Change of mailing address, telephone number or fax number.

Changes of personnel affecting responsibility for insurance decisions.

If 25% or more of any building you own becomes vacant or unoccupied for more than 30 days.

Personnel traveling overseas/on temporary assignment overseas/working on military bases.

Personnel traveling to/on temporary assignment in/working in New York State. You may be required to obtain Workers’

Compensation and Disability Benefits policies.

Use of Independent Contractors ‐ carriers now require proof that they are running a separate business and have their own

insurance coverage. You may be asked to provide copies of 1099s, certificates of insurance, business cards, their invoice

and/or their website address/yellow pages entry to avoid inclusion as employees of your company.

Acquisition or creation of new companies or subsidiaries and/or mergers in which you are involved or any legal change in

the corporate structure.

Purchase, construction or occupancy of new premises; alteration, vacating the premises or temporary unoccupancy;

extension or demolition of existing premises. This applies for both domestic and foreign locations.

Increase in values of building or business personal property for both scheduled and unnamed locations.

Removal of business personal property or stock to new or temporary locations.

Addition of new locations, equipment or vehicles, whether hired, leased or borrowed.

Changes in processes, occupancy, products or business operations.

Addition, alteration or temporary disconnection of fire or burglary protection systems.

Use of owned or non‐owned aircraft or watercraft.

Major changes in value or nature of goods being shipped.

Employment of personnel in states in which you were previously not doing business.

Election or appointment of a new CEO or COO, or change in control of either the Board of Directors or the stock ownership

of the company.

Changes in ERISA Plan assets.

Addition of new drivers for the company.






Loss Experience

Claims: Amount Paid/Reserves

9/7/16, Fire at Shoreway Facility Gross Loss Paid $8,585,916.84Closed Claim #15-00826199 Gross Loss Reserves $0.00

9/11/16, 2nd Fire (Pile of Refuse Ignited) Gross Loss Paid $325,033.31

Closed Claim #15-00828608 Gross Loss Reserves $0.00






2019 Property Values

Loc # Address Building Value

Business Personal Property Business Income

1 225-233 Shoreway Road, San Carlos, CA 94070

Administration Building $775,350 Transfer Station $17,801,000 Material Recovery Facility $14,171,000 Equipment $17,810,000 Maintenance Shop $2,952,000 Container Repair/Wash Rack $1,350,000 2 Permanent Trailers $20,000

Truck Scales (One large above & below ground) $2,405,000

Total Location Limits: $37,069,350 $20,215,000 $10,949,806

2 610 Elm St., #202, San Carlos CA 94070

SBWMA's Office (Multi-tenant office building) $90,000 $100,000

(2019)

Total Insured Value: $68,424,156 $37,069,350 $20,305,000 $11,049,806






2019 Policy Information July 1, 2019 to July 1, 2020 term

Property Policies in layers

Primary Layer, Part I: $5,000,000 part of the primary $10,000,000

TIV, $68,424,156

Carrier: First Specialty Insurance Corp, Swiss Re Excess & Surplus Property Perils: "All Risk" excluding Equipment Breakdown/Boiler & Machinery

Deductible Premium Broker Fee

SL Tax/Fees Part I Premium

$1,000,000 $270,000 $5,000 $8,640 $283,640.00

Primary Layer, Part II: $5,000,000 part of the primary $10,000,000 Carrier: Landmark American Ins, RSUI Perils: "All Risk" excluding Equipment Breakdown/Boiler & Machinery


SL Tax/Fees Part II Premium

$1,000,000 $270,000 $5,000 $8,640 $283,640.00

First Excess Layer, part I: $5,000,000 part of $10,000,000 Carrier: Westchester Surplus Lines Insurance Company Perils: "All Risk" excluding Equipment Breakdown


SL Tax/Fees

Part I, total premium

$1,000,000 $61,290 $500 $1,961.28 $63,751.28

First Excess Layer, part II: $5,000,000 part of $10,000,000 Carrier: Aspen Specialty Insurance Company, RSUI Perils: "All Risk" excluding Equipment Breakdown


SL Tax/Fees

Part II, total premium

$1,000,000 $61,290 $500 $1,961.28 $63,751.28




jtong

Highlight



2019 Policy Information July 1, 2019 to July 1, 2020 term Property Policies in layers (Cont’d)

Second Excess Layer: $10,000,000 excess $20,000,000 Carrier: Hallmark Specialty Insurance Company Perils: "All Risk" including Equipment Breakdown

Deductible Premium Broker & Policy Fee

SL Tax/Fees Total Premium

$1,000,000 $80,500 $1,250 $2,584 $84,334.00

Third Excess Layer, part I: $15,000,000 of $30,000,000 excess Carrier: One Beacon Insurance Company Perils: "All Risk" including Equipment Breakdown Part I,

Deductible Premium Broker Fee SL Tax/Fees Total Premium

$1,000,000 $75,000 $500 $2,400 $77,900.00

Third Excess Layer, part II: $15,000,000 of $30,000,000 excess Carrier: James River Casualty Company Perils: "All Risk" including Equipment Breakdown Part II,


$1,000,000 $75,000 $500 $2,400 $77,900.00






2019 Policy Information July 1, 2019 to July 1, 2020 term Property Policies in layers (Cont’d)

All layers total to: $60,000,000 Total Limits Premium: $934,916.56

Equipment Breakdown $60,000,000 Limit Premium: $20,000.00 Carrier: Continental Casualty Co

Total

Premium: $954,916.56






2020 Property Values

Loc # Address Building Value

Business Personal Property Business Income

1 225-233 Shoreway Road, San Carlos, CA 94070

Administration Building $775,350 Transfer Station $17,801,000 New O2E Equipment $5,250,000 Material Recovery Facility $14,171,000 Equipment $17,810,000 New Equipment $7,401,700 Maintenance Shop $2,952,000 Container Repair/Wash Rack $1,350,000 2 Permanent Trailers $20,000

Truck Scales (One large above & below ground) $2,405,000

Total Location Limits: $37,069,350 $32,866,700 $10,949,806

2 610 Elm St., #202, San Carlos CA 94070

SBWMA's Office (Multi-tenant office building) $90,000 $100,000

Total Insured Value:

$81,075,856 $37,069,350 $32,956,700 $11,049,806

(2019 TIV: $68,424,156)






RENEWAL JULY 1, 2020 TO JULY 1, 2021 TERM

Primary Layer, Part I: $5,000,000 part of the primary $10,000,000

TIV, $81,075,856

Carrier: First Specialty Insurance Corp, Swiss Re Excess & Surplus Property Perils: "All Risk" excluding Equipment Breakdown/Boiler & Machinery

Deductible Premium Broker Fee SL Tax/Fees Part I Premium

$500,000 $ $ $ $

$1,000,000 $385,000 $7,500 $12,512.50 $405,012.50

Primary Layer, Part II: $5,000,000 part of the primary $10,000,000 Carrier: Landmark American Ins, RSUI Perils: "All Risk" excluding Equipment Breakdown/Boiler & Machinery

Deductible Premium Broker Fee SL Tax/Fees Part II Premium

$500,000 $ $5,000 $ $

$1,000,000 $385,000 $5,000 $12,512.50 $405,012.50

First Excess Layer, part I: $5,000,000 part of $10,000,000 Carrier: Westchester Surplus Lines Insurance Company Perils: "All Risk" excluding Equipment Breakdown

Deductible Premium Broker Fee SL Tax/Fees

Part I, total premium

$500,000 $ $ $ $

$1,000,000 $ $

First Excess Layer, part II: $5,000,000 part of $10,000,000 Carrier: Aspen Specialty Insurance Company, RSUI Perils: "All Risk" excluding Equipment Breakdown

Deductible Premium Broker Fee SL Tax/Fees

Part II, total premium

$500,000 $ $ $ $

$1,000,000 $ $ $ $







Second Excess Layer: $10,000,000 excess $20,000,000 Carrier: Hallmark Specialty Insurance Company Perils: "All Risk" including Equipment Breakdown

Deductible Premium Broker & Policy Fee

SL Tax/Fees Total Premium

$500,000 $ $ $ $

$1,000,000 $ $ $ $

Third Excess Layer, part I: $15,000,000 of $30,000,000 excess Carrier: One Beacon Insurance Company Perils: "All Risk" including Equipment Breakdown Part I,


$500,000 $ $ $ $

$1,000,000 $ $ $ $

Third Excess Layer, part II: $15,000,000 of $30,000,000 excess Carrier: ______________ Company Perils: "All Risk" including Equipment Breakdown Part II,


$500,000 $ $ $ $

$1,000,000 $ $ $ $







All layers total to: $60,000,000 Total Limits

Deductible: $500,000 Premium: $

Deductible: $1,000,000 Premium: $

Equipment Breakdown $60,000,000 Limit Carrier: Continental Casualty Co Deductible: $500,000 Premium: $ Deductible: $1,000,000 Premium: $25,322.00 TOTAL PREMIUM: DEDUCTIBLE: $500,000 $ DEDUCTIBLE: $1,000,000 $

Please note, this is contingent on being loss free until the 7/1/20 renewal date and no events occurring, EQ, Hurricanes etc. In the event of an occurrence, the underwriters may need to reconsider their position. In all cases, the company quotes (plus the miscelleneous tax & fees) apply.






Marketing Survey Markets approached that might provide us with a quote:

AmWins – Ineligible under both programs ReCycle Guard APU Waste Haulers program:

Great Divide Insurance Company Nautilus Insurance Company

Sompo International Through Surplus Lines Markets: List to follow






Coverage Considerations The following coverages are not purchased or handled by us. Please contact us if you would like a quote on any of these coverages. General Liability: Bodily injury and/or property damage coverage as respects suits brought by third parties, which the Named Insured may be found legally obligated to pay Employee Benefits Liability: Protects against suits by employees (or estate) for misinforming about benefits. Umbrella Liability: Catastrophe liability coverage in excess of basic third party liability policies. (General Liability, Automobile, Employer Liability, etc.) International Property, Liability, Auto & Foreign Voluntary Workers Compensation: Exposures outside of the US and its territories. There are many countries that require local, admitted coverage for permanent locations. Flood and/or Earthquake: Damage to real or personal property and resulting loss of earnings, etc. Business Interruption/Rental Income: Loss of net profit, before taxes, plus continuing expense. Contingent Business Interruption/Extra Expense: Loss of net profit, before taxes, resulting from damage or destruction of suppliers or customers. Off Premises Service Interruption ‐ Power, Communication and Water: Business Income Loss and Direct Damage. Extra Expense: Expenses to continue operations after a loss, which are above those normal to the business. Valuable Papers: Cost to reproduce or reconstruct valuable documents. Accounts Receivable: Uncollectible receivables in event of a loss plus cost to reproduce and interest expense. Ordinance or Law Coverage on Building: Enforcement of any ordinance or law regulating the construction, use or repair of property. Undamaged Portion of Building; Demolition; Increase Cost of Construction. Real & Business Personal Property: Direct physical loss to your building, office contents, equipment or stock, etc Landlord’s Property: If applicable, as a tenant, you may be contractually responsible to insure the building glass, fixtures, HVAC, and permanently attached machinery and equipment, etc. Spoilage: Food, medicine and or chemical loss due to equipment breakdown. Fine Arts: Damage or loss to property that is rare or has historic/artistic value. Ocean Cargo Coverage: Covers shipments made to or from any place in the world when shipped at your own risk or on your behalf by others. It can also include Foreign & Domestic Inland Transit and Warehouse Coverage. Transit: Domestic shipments made at your risk anywhere in the United States or Foreign Inland transit shipments outside of the US. Boilers and other Steam Pressure Vessels and System Breakdown/Equipment Breakdown: Explosion or sudden and accidental breakdown and resultant loss of earnings, this can be extended to other equipment such as miscellaneous electrical apparatus, air conditioning equipment, etc. Data Processing Hardware and/or Media: Direct damage and resulting extra expense. Plate Glass: Breakage by any means. Water Damage: Sewer and Drains Backup and Underground Water Seepage. Terrorism Risk Coverage: Coverage for Certified Acts of Terrorism Fidelity: Loss of money or other property from an employee's dishonest act. Depositors Forgery: forgery or alteration of checks, etc. by anyone.






Coverage Considerations Cont. Money & Securities: Loss of money or securities by any means. ERISA Bond: Mandatory Dishonesty Coverage equal 10% of your pension plan assets. Computer and Funds Transfer Fraud: Cybercriminals targeting business email and IT systems as entry points for fraud, data theft and other malicious activities. The attacks take a variety of forms; from malware to hackers posing as a CFO or controller asking an employee to wire funds. Include Social Engineering coverage as well.Social Engineering: direct loss from the transferring, paying or delivering of money or securities by the intentional misleading of an employee by a person purporting to be a vendor, client, employee or authorized person through the use of a communication. This coverage may be added to either the security or privacy/cyber or crime policy. Hired & Non‐Owned Auto Liability: Coverage for vehicle rented, leased or borrowed by the corporation for 3rd party liability only. Hired Auto Physical Damage: Property damage to a hired vehicle. Drive Other Car Coverage: Liability for Named Individuals on an Automobile policy. (This coverage is necessary for employees, directors, officers, owners, and their families that do not have a personal Automobile policy). Commercial Automobile Coverage: Physical loss/damage and Liability to owned business vehicles. Workers' Compensation Coverage: This coverage is mandatory in ALL STATES if you have any employees. If any of your employees are not currently covered under Workers' Compensation, please notify us immediately. Stop Gap Liability: Employers' Liability Coverage for Monopolistic Workers' Compensation States. This coverage is needed if you have payroll in any of the following Monopolistic States: ND, OH, WA, and WY. Disability Benefits Liability: This coverage is mandatory in the states of New York, New Jersey, California, Hawaii, and Puerto Rico if you have any employees. Please notify our office immediately if you have employees in any of these states and currently do not have a Disability Benefits Liability Policy. Product Recall: Covers expenses associated with recalling a product from the market. Product recall insurance is typically purchased by manufacturers such as food and beverage, toy and electronics companies to cover costs such as customer notification, shipping costs and disposal costs. Restaurant Recovery Insurance/Food Contamination, Tampering, Publicity: Accidental contamination or any publicity in connection with an actual contamination; Malicious tampering (i.e. glass intentional put into bread); Product extortion (i.e. threat by disgruntled employee to contaminate); Adverse publicity and baseless adverse publicity. Product Contamination: Provides coverage for recall‐related expenses, loss of gross profits, rehabilitation expense and crisis response in the event of product tampering and accidental product contamination. Fiduciary Liability: Protects the administrators of ERISA plans against 3rd party suits alleging wrongful management or breach of duties concerning the plan assets. Professional Liability: Any economic damages resulting from alleged negligence or failure to render your professional services to others. Media Liability: Protects against claims alleging defamation, libel, slander, infringement of trademark and copyright, invasion of privacy arising from any content created and disseminated by you whether electronically or in print. Intellectual Property: Provides coverage for infringement of patent, copyright, trademark, service mark or trade name or unfair competition based upon actual or alleged infringement of patent, copyright, trademark, service mark or trade name.






Coverage Considerations Cont. Security & Privacy Liability/Cyber: Protects against claims alleging a failure in maintaining your network security and the private information of others. This policy also provides reimbursement for expenses directly incurred by you including forensic costs, statutory notification, and credit monitoring. Employment Related Practices Liability: Protects against suits by employees including former and prospective employees alleging wrongful termination, discrimination, and sexual harassment. Also may be able to include wage and hour claims and third party coverage. These types of losses are excluded from general liability and workers compensation policies. Directors and Officers Liability: Affords protection for Directors & Officers (profit & non‐profit) as respects to their business decisions for the corporation. Employed Lawyers Liability: coverage that is tailored specifically to in‐house counsel which will protect in‐house counsel in the event a claim or suit alleges wrongful conduct on their part in the capacity as legal counsel to the company. Group Travel: Accidental death or dismemberment coverage for business or pleasure travel. Kidnap and Ransom: Reimbursement for monies paid to kidnappers or extortionists. Environmental Impairment Liability: Pollution Liability from contamination of an environment by substances regarded as pollutants (an irritant or contaminant, whether in solid, liquid, or gaseous form, including‐when they can be regarded as an irritant or contaminant‐smoke, vapor, soot, fumes, acids, alkalis, chemicals, and waste).Tank Liability: 3rd party liability and clean‐up costs for above or underground storage tanks Fine Art Title Insurance: Object specific coverage against questions of legal ownership, government seizure and liens from previous owners. Policy provides for defense costs in addition to insuring the value of an artwork.

Available Life and Health Products:

Employee Benefits programs Life (Permanent and Term) Key Person/Buy‐Sell/Deferred Compensation Estate Planning Long Term Care Disability Key person/Buy‐Out/Overhead Expense Annuities Asset Protection 100% Executive Medical Reimbursement Plan.

Available Coverages for Individuals:

Homeowners Co‐ops Condominiums Vacation and Second Residence Excess Liability Automobiles Aircraft, Watercraft Jewelry and Fine Arts






Office Locations

Risk Strategies Company 160 Federal Street ● Boston, MA 02110

(617) 330‐5700

Atlanta, GA (678) 690‐5990

Baltimore, MD (410) 561‐3593

Birmingham, AL (205) 979‐7389

Boston, MA (617) 330‐5700

Boston Metro, MA(781) 986‐4400

Chicago, IL (312) 506‐8860

Cleveland, OH (877) 862‐4755

Cocoa, FL (321) 459‐9905

Dallas, TX (214) 503‐1212

Estero, FL (239) 949‐1888

Fort Lauderdale, FL (954) 525‐0582

Hollywood, FL (954) 963‐6666

Irvine, CA (949) 242‐9240

Long Island, NY (516) 858‐5770

Los Angeles, CA (818) 623‐5400

Marco Island, FL (239) 963‐2344

Memphis, TN (901) 820‐0400

Miami, FL (954) 399‐5243

Miami, FL (305) 446‐2271

Minneapolis, MN (612) 766‐9780

New Rochelle, NY 877‐862‐4755

New York, NY (212) 867‐3550

Nashville, TN (615) 383‐0072

Newport, RI (401) 619‐4790

Newport Beach, CA(866) 532‐7490

Northbrook, IL (847) 412‐1013

Portsmouth, NH (603) 778‐8985

Providence, RI (401) 831‐1463

R. Palm Beach, FL (561) 784‐5445

Sacramento, CA (916) 367‐4310

San Diego, CA (858‐792‐4000

San Francisco, CA (650) 762‐0400

Sarasota, FL (941) 929‐1598

Schenectady, NY (518) 377‐4904

Teaneck, NJ (201) 837‐1100

Tampa, FL (813) 287‐8300

Worcester, MA (508) 798‐0893





9

Resolution Recommending Approval of the Calendar Year

2019 Financial Statements

Agenda Item 9



SBWMA FINANCE COMMITTEE MEETING 05/12/2020 AGENDA ITEM: 9- p1

9

STAFF REPORT To: From:

Date: Subject:

SBWMA Board Members Joe La Mariana, Executive Director John Mangini, Senior Finance Manager May 12, 2020 Finance Committee Meeting Resolution Recommending Approval of the Calendar Year 2019 Financial Statements

Recommendation It is recommended that the SBWMA Board of Directors approve Resolution No. 2020-XX attached hereto authorizing the following action:

• Approving the South Bayside Waste Management Authority’s Financial Report for Calendar Year 2019 asreviewed by SBWMA’s audit firm, Maze & Associates.

Analysis As part of the 2019 Bond Indenture, the SBWMA is required to present an unaudited calendar year Statement of Revenues, Expenses and Debt Service Coverage to the bond rating agencies. This report was reviewed on May 12th, 2020 by the Board Finance Committee which recommends its approval. The reports are limited to information that is required in the bond indenture and include the results of the bond covenant tests. The attached SBWMA Statement of Revenues, Expenses and Debt Service Coverage (see Attachment A) for the calendar year ending December 31, 2019, was prepared by the City of Redwood City Administrative Services Department with assistance from SBWMA staff and examined by the independent auditing firm of Maze & Associates. The audit firm reported that the SBWMA’s financial report was prepared in conformity with generally accepted accounting principles (GAAP); however, the report is unaudited.

Overview of the Financial Reports Table 11 of the attached Financial Information shows net revenues for calendar year 2019 of $10,884,041. The SBWMA is obligated by the bond indenture to set tip fees at Shoreway that produce financial results which generate enough revenue to achieve the covenant tests. The SBWMA is reporting debt service coverage of 8.28 that meet the minimum requirements of 1.40. These tests are intended to show sufficient liquidity to satisfy bond holders that there is sufficient income to cover bond debt service. Debt Service is substantially reduced in calendar year 2019 due to the 2009A Bond Refunding and 2019 Bond Issuance that occurred within the calendar year.

Bond Financial Performance Requirements Minimum

Ratio 2016 2017 2018 2019

Debt Coverage Ratio 1.40 1.99 2.25 1.70 8.28

Bond Covenant TestCalendar Year



Background In 2019 the Board approved the issuance of $48.8 million par value of Solid Waste Enterprise Revenue Series 2019 Bonds, to refund the $44.6 million outstanding Solid Waste Enterprise Revenue Bonds, Series 2009A to achieve Present Value debt service savings and raise $20 million in new money proceeds to fund priority capital projects of the Agency. The 2019 bond indenture requires annual financial reporting on a fiscal (audited) and calendar year (unaudited) basis. Most of our business is conducted on a calendar year basis. Our rates paid to SBR, Recology, and disposal and processing vendors all are adjusted effective January 1st. The tip fees at Shoreway are also adjusted, if needed, on January 1st. Therefore, for bond reporting, it made sense to report our financial results on a calendar year basis; however, our fiscal year ends on June 30th. This reporting timing will change with the Agency’s coming transition in Financial Accounting Period from fiscal to calendar year basis. Maze & Associates also audits our fiscal year financial statement. The audited financial statement for FY18/19 was approved by the Board at the January 30, 2020 Board meeting. Fiscal Impact The cost for the audit firm to perform the Calendar Year Compilation is approximately $2.5K.

Attachments: Resolution 2020-XX Attachment A – Calendar Year 2019 Unaudited Financial Information



RESOLUTION NO. 2020-XX RESOLUTION OF THE SOUTH BAYSIDE WASTE

MANAGEMENT AUTHORITY BOARD OF DIRECTORS APPROVING THE CALENDAR YEAR 2019 FINANCIAL STATEMENTS

WHEREAS, the South Bayside Waste Management Authority contracted with the audit firm of Maze & Associates to conduct a review of the Agency’s financial records in accordance with Governmental Accounting Standards, and WHEREAS, the financial statements for the calendar year ending December 31, 2019 as prepared by said firm have been completed, and NOW, THEREFORE BE IT RESOLVED that the South Bayside Waste Management Authority hereby approves the unaudited Annual Financial Information Report as prepared by Maze & Associates for the calendar year ending December 31, 2019. PASSED AND ADOPTED by the Board of Directors of the South Bayside Waste Management Authority, County of San Mateo, State of California on the 28th of May, 2020, by the following vote:

I HEREBY CERTIFY that the foregoing Resolution No. 2020-XX was duly and regularly adopted at a regular meeting of the South Bayside Waste Management Authority on May 28, 2020. ATTEST: Jess E (Jay) Benton, Chairperson of SBWMA _________________________________ Cyndi Urman, Clerk of the Board

Agency Yes No Abstain Absent Agency Yes No Abstain Absent Atherton Menlo Park Belmont Redwood City Burlingame San Carlos East Palo Alto San Mateo Foster City County of San Mateo Hillsborough West Bay Sanitary Dist.


SOUTH BAYSIDE WASTE MANAGEMENT AUTHORITY

UNAUDITED FINANCIAL INFORMATION

DECEMBER 31, 2019

_________________________________________________ SBWMA FINANCE COMMITTE PACKET 05/12/2020



This Page Left Intentionally Blank




SOUTH BAYSIDE WASTE MANAGEMENT AUTHORITY

UNAUDITED FINANCIAL INFORMATION

FOR THE CALENDAR YEAR ENDED DECEMBER 31, 2019

TABLE OF CONTENTS

Page Number

COMPILATION REPORT ........................................................................................................... 1

FINANCIAL INFORMATION

Unaudited Statement of Revenues, Expenses and Debt Services Coverage ....................... 2








INDEPENDENT ACCOUNTANT’S COMPILATION REPORT

To Members of the Board of Directors of the South Bayside Waste Management Authority (Authority) San Carlos, California

Management is responsible for the accompanying Unaudited Statement of Revenues, Expenses and Debt Service Coverage (financial information) for the Year ended December 31, 2019, in accordance with the form prescribed by the $31,860,000 South Bayside Waste Management Authority Solid Waste Enterprise Refunding Revenue Bonds (Shoreway Environmental Center) Series 2019A (Non-AMT) (Green Bonds) and the $16,915,000 South Bayside Waste Management Authority Solid Waste Enterprise Revenue Bonds (Shoreway Environmental Center) Series 2019B (AMT) (Green Bonds) Official Statement (2019 OS). We have performed a compilation engagement in accordance with Statements on Standards for Accounting and Review Services promulgated by the Accounting and Review Services Committee of the American Institute of Certified Public Accountants (AICPA). We did not audit or review the financial information nor were we required to perform any procedures to verify the accuracy or completeness of the information provided by management. Accordingly, we do not express an opinion, a conclusion, nor provide any form of assurance on the financial information.

The Authority’s financial information mentioned above were prepared on the basis in accordance with the form prescribed by the 2019 OS mentioned above, and are not intended to be a presentation in accordance with accounting principles generally accepted in the United States of America.

Management has omitted the disclosures ordinarily included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America, because such disclosures are not a requirement of the 2019 OS.

This report is intended solely for the information and use of the Board of Directors of the Authority for the compliance of with the Official Statement, and is not intended to be and should not be used by anyone other than these specified parties.

Pleasant Hill, California March 30, 2019

1




Table 11SOUTH BAYSIDE WASTE MANAGEMENT AUTHORITYUNAUDITED STATEMENT OF REVENUES, EXPENSES

AND DEBT SERVICES COVERAGEFOR THE CALENDAR YEAR ENDED DECEMBER 31, 2019

2019REVENUES

Charges for services 49,029,415$ Commodity revenue 5,581,945Other 31,046Grant revenue 1,020,000Interest Income 730,950

Total Revenues 56,393,356

OPERATING EXPENSESShoreway operations 33,256,210MSW Disposal 9,130,706SBWMA program administration 3,122,399

Total Operating Expenses 45,509,315

Total Net Revenues 10,884,041$

Debt Services 1,314,750$

Debt Services Coverage 8.28

Ending Unrestricted Fund Balances 15,702,105$

See Independent Accountants' Compilation Report

2








10

Review of FY 20/21 budget and 6-month ( July 1, 2020 – December 31, 2020) Transition Budget and

Cap-Ex Review

Agenda Item 10




10

STAFF REPORT To: SBWMA Board Members From: Joe La Mariana - Executive Director

John Mangini - Senior Finance Manager Date: May 12, 2020 SBWMA Finance Committee Meeting Subject: Review of FY 20/21 budget and 6-month (July 1, 2020 – December 31, 2020) Transition Budget and

Cap-Ex Review

Recommendation This Preliminary FY20/21 SBWMA Budget is for discussion only and it will be brought to the Board in draft form in May for further review, and to the Board June for final consideration.

Summary The FY 20/21 SBWMA Budget reflects Staff’s recommendations to manage revenues and expenses to meet bond covenant ratios and increase the capital reserve balance to ensure sufficient funding for future capital projects of the Agency. Staff is recommending tip fee increases in several non-franchised material categories per Table 1 below. Staff has considered several of relevant factors in arriving at the proposed tip fee increases; including, the projected costs to handle each material type, the sensitivity of increases to Member Agencies coinciding with the cost increases associated with Restated and Amended Collection Contract with Recology of San Mateo County, and not disincentivizing public customers from diverting material from landfill.

To facilitate the successful one-time transition from a Fiscal Year Accounting Period Ending June 30, to Calendar Year Accounting Period Ending December 31, Staff is presenting both:

• A six-month DRAFT budget (July 1, 2020 to December 31, 2020), and• A full year DRAFT budget (July 1, 2020 to June 30, 2021)

These DRAFT documents are presented for Board review during this May BOD meeting, and a FINAL Budget for consideration at the June BOD Meeting. A traditional full year budget (July 1, 2020 to June 30, 2021) is being presented for consideration due to the need to estimate January 1, 2021 tipping fees at the Shoreway Facility. See Agenda item #7 of this meeting for further details.

To assist the Board in its fiduciary evaluation of these documents, staff is presenting 1) a Business-as-Usual (Status Quo) Budget for Finance Committee Review and 2) a Reduced Volume Budget with assumptions based on the reduced volumes/recent financial impacts realized due to the temporary closure of the Shoreway Facility’s transfer station to the public from March 17 to May 4, 2020. This partial closure of the Shoreway transfer station operations during this period was required to comply with County Public Health Order c19-5c (Shelter-in-Place). Staff has tried to apply many known factors into this second draft budget recognizing that numerous unknowns will play out during the months ahead.



Table 1

Fiscal Impact 1. Business-as-Usual (Status Quo) Budget: The FY20/21 Status Quo Budget assumes continued operations with no impact of COVID-19 which forecasts a Net Income of $1,566,403 which is $2.0 million lower than FY19/20 Adopted Budget (See Attachments A – D). Staff felt it was relevant to present this unaltered budget to the Finance Committee to give a comparative sense of the Agency’s normal projections. For the purpose of this review the Attachments will be the main tool for review and discussion for this Agenda item. Attachments A – D detail the Business-as-Usual (Status Quo) Budget. 2. Reduced Volume Budget: The FY20/21 Reduced Volume Budget projects volume reductions. Estimated reductions within this budget scenario are:

• -5% Solid Waste • -5% Green Waste • -35% Food Waste, and • -10% C&D.

This Budget forecasts net income of $633,808. Attachment E details the Reduced Volume Budget. Table 2 below illustrates the projected Debt Coverage of each budget scenario.

Actual Actual Actual Proposed Proposed7/1/2018 1/1/2019 2020 7/1/2020 1/1/2021 21 vs 20 $ 21 vs 20 %

Franchise Tip Fees / Ton incr. %

Solid Waste 107.00$ 121.00$ 121.00$ 121.00$ 126.00$ 5.00$ 4.1%Green Waste 112.00$ 126.00$ 126.00$ 126.00$ 139.00$ 13.00$ 10.3%Food 131.00$ 141.00$ 141.00$ 141.00$ 141.00$ -$ 0.0%

3rd Party / TonSolid Waste 113.00$ 127.00$ 127.00$ 127.00$ 132.00$ 5.00$ 3.9%Green Waste 115.00$ 128.00$ 128.00$ 128.00$ 140.00$ 12.00$ 9.4%Food 131.00$ 141.00$ 141.00$ 141.00$ 141.00$ -$ 0.0%C&D 107.00$ 121.00$ 121.00$ 121.00$ 126.00$ 5.00$ 4.1%Asphalt Roofing 110.00$ 123.00$ 123.00$ 123.00$ 128.00$ 5.00$ 4.1%

Public Dirt /Ton 98.00$ 103.00$ 110.00$ 115.00$ 117.00$ 7.00$ 6.4%

Public Tip Fees / Yd 7/1/2018 1/1/2019 2020 7/1/2020 1/1/2021 21 vs 20 $ 21 vs 20 %Solid Waste 42.00$ 44.00$ 44.00$ 46.00$ 47.00$ 3.00$ 6.8%Green Waste 33.00$ 35.00$ 35.00$ 42.00$ 50.00$ 15.00$ 42.9%C&D 42.00$ 44.00$ 44.00$ 46.00$ 47.00$ 3.00$ 6.8%

FY 20/21 BUDGET - Tip Fee Increases



Overview Budget Process: The Board-level review schedule for this budget includes the following steps:

• May 12: Finance Committee review • May 28: Board review and feedback of preliminary budget • May 28: Board discussion of the planned capital budget • June 25: Final Board consideration of final budget

Organization of the FY 20/21 Budget Report:

Attachment A: You will find the preliminary FY20/21 detailed operating budget (including cash reserve balances, revenues, and expense and capital budget). The expense detail in Attachment A has three main parts: the SBWMA Program budget, the Shoreway Operations budget and the non-operating expenses.

Attachment B: You will find further detail of the Budget including volumes and statistics. Attachment C: Provides the current organization chart and details on personnel related budget assumptions. (Not included for Finance Committee Meeting)

Attachment D: Provides back up detail on commodity revenue and prices. Attachment E: Reduced Volume Alternative Budget Core Staff Responsibilities:

• Franchise Agreement Contract Administration: Continued oversight, contract administration and technical support for the 12 collection services agreements with Recology San Mateo County (RSMC) on behalf of member agencies. In 2020, the value of these 12 contracts totaled $59.5 million.

Table 2

Projected Debt Coverage Normal VolumeReduced Volume

Operating and Non-Operating Revenue 57,847,871$ 53,929,443$ plus Additional Revenue transfer from reserve or other - - Total Revenues 57,847,871 53,929,443

Less: O&M Expense 51,427,187 48,597,950 Net Revenue 6,420,684 5,331,493

Debt Service 3,641,250 3,641,250 Coverage (Net Revenue/Debt Service) 1.76 1.46

Budgeted Net Income to Reserve 1,566,403 663,808



• Shoreway Environmental Center—Facility and Contractor Oversight: Manage all financial, operational, capital and maintenance needs, planning and compliance aspects of the agency-owned 16-acre solid waste facility through direct engagement or through the activities of our primary contractor, South Bay Recycling (SBR). In 2019, the total value of the SBR Operating Contract was $21 million. Facility oversight responsibilities includes: over 200,000 square feet of building management; a high-volume diesel fueling station (1M+ gallons/year); two industrial -scale vehicle maintenance facilities (for RSMC and SBR operations); and over $20M worth of equipment owned by the SBWMA. Additionally, 350+ employees and 150+ work vehicles are based on this site; and another 190 employee vehicles are also temporarily parked on-site during their shifts.

• Materials Management: Provide technical expertise in planning, compliance and management of all aspects of the agency’s major contracts for the disposal and/or handling/processing of all MSW, organics, construction and demolition, and recyclable materials (through SBR). In 2018, this responsibility represented the proper handling of 472,716 tons of materials with a total contract value of over $19M.

• Management of Annual Contractor’s Compensation Adjustment Process (RSMC and SBR), including review of the 2019 RSMC and SBR compensation applications and completion of final audit reports (Recology and SBR) for 2017.

• Long-Term Program and Capital Planning---to Maintain Statutory Compliance of Expanding Solid Waste/Diversion Requirements: On our member agency’s behalf, agency staff is always forward-thinking on all levels of facility operations, contractor’s scope of work and programmatic requirements to ensure that these goals are sufficiently satisfied on a cost-effective basis.

• Manage Public Education and SBWMA-Planned Community program activities: To provide technical support for the residential and multi-family unit collection services,and manage the development of the outreach materials for the commercial collection programs. In 2018, there were 18 SBWMA-planned community events (16 “Shred/E-Waste/Compost events; an Earth Day public event (April 21st and a Rethink Recycling Day public event (October 27th)). Over 700 members of the public attended these two “on-site” events, and many hundreds more enjoyed the Shred/E-Waste/Compost Events in their communities.

• Management of the Shoreway Education Center Tour Program: including the school and public tours. This program educates an average of over 5,000 tour visitors per year in about 250 facility tours.

Capital Expenditures:

The FY20/21 Capital Expenditures budget is $9,635,000 including $8.9 million paid from the 2019 Bond Fund Account. A 5-year capital schedule of projects is included in Attachment A – FY20/21 Attachments:

A. SBWMA FY19/20 Capital & Operating Budget Detail B. SBWMA Budget Detail - Volume and Statistics C. Organization Chart & Personnel Summary (Not included for Finance Committee Meeting) D. Commodity Revenue E. Reduced Volume Alternative Budget


Attachment A - FY20/21 Budget Revenues by Major Source

REVENUE SUMMARYACTUAL FY18/19

ADOPTED BUDGET FY19/20

MID-YEAR BUDGET FY 19/20

Jul1 - Dec31 2020

Jan1 - Jun30 2021

PROPOSED BUDGET FY20/21

Variance to Adopted Budget

Variance % to Adopted

Budget Notes

1 ADMINISTRATIVE REVENUE:2 INVESTMENT INCOME 621,287$ 376,994$ 757,835$ 303,686$ 273,770$ 577,455$ 200,461$ 53.2%3 TOTAL ADMINISTRATIVE 621,287$ 376,994$ 757,835$ 303,686$ 273,770$ 577,455$ 200,461$ 53.2%

4 OPERATIONS REVENUE:

5 SHOREWAY TIP FEES - Non Franchised 11,694,389$ 12,112,251$ 12,609,055$ 6,685,052 6,732,050 13,417,102$ 1,304,851$ 10.8%

6 SHOREWAY TIP FEES - Franchised 34,710,487 37,030,309 36,695,234 18,429,484 19,622,290 38,051,775$ 1,021,466 2.8%

7 COMMODITY SALES REVENUE 6,579,151 6,838,073 5,755,713 2,919,415 2,919,415 5,838,829 (999,244) -14.6%

8 COMMODITY REVENUE SHARING W/ SBR (438,837) (395,652) (297,884) - (50,838) (50,838)$ 344,814 -87.2%9 BUY BACK CENTER - Payment to Customers (894,670) (843,906) (163,039) - - - 843,906 -100.0%10 MISCELLANEOUS REVENUE 28,324 19,160 19,219 6,774 6,774 13,548 (5,612) -29.3%

11 SUBTOTAL OPERATIONS REVENUE 51,678,845$ 54,760,235$ 54,618,298$ 28,040,725$ 29,229,690$ 57,270,415$ 2,510,180$ 4.6%22

12 TOTAL OPERATING REVENUES 51,678,845$ 54,760,235$ 54,618,298$ 28,040,725$ 29,229,690$ 57,270,415$ 2,510,180$ 4.6%

13 NON-OPERATING RECEIPTSGRANT REVENUE 1,020,000$ 1,000,000

14 TOTAL REVENUE 53,320,131$ 55,137,230$ 56,376,132$ 28,344,411$ 29,503,460$ 57,847,871$ 2,710,641$ 4.9%

15 TOTAL OPERATING EXPENSES 49,188,504$ 51,538,173$ 51,305,880$ 27,312,726$ 28,968,746$ 56,281,468$ 4,743,295$ 9.2%

16 NET OPERATING INCOME 4,131,627$ 3,599,057$ 5,070,252$ 1,031,684$ 534,714$ 1,566,403$ (2,032,654)$ -56.5%

Draft FY2021 Budget v2 Revenues5/4/2020

11:05 AM




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Status Quo Budget

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line EXPENDITURE SUMMARY1 ADMINISTRATIVE EXPENSES2 ADMINISTRATIVE STAFF3 MANDATED COMPLIANCE SUPPORT STAFF4 BOARD COUNSEL5 BOARD MEETINGS6 ACCOUNTING SERVICES7 INFORMATION SYSTEMS 8 WEBSITE 9 ANNUAL AUDIT10 D&O INSURANCE 11 BANK FEES12 RENT13 PRINTING AND POSTAGE14 UTILITIES15 OFFICE/TENANT IMPROVEMENTS16 OFFICE SUPPLIES17 OFFICE EQUIPMENT COSTS 18 PUBLICATIONS & PUBLIC NOTICES19 PROFESSIONAL DUES & MEMBERSHIPS20 VEHICLE MILEAGE & TOLLS21 CELL PHONES22 CONFERENCE & MEETINGS23 TRAINING24 SPONSORSHIPS & DONATIONS

25 LEGISLATIVE & REGULATORY ADVOCACY26 COMPUTER PURCHASE27 TOTAL ADMINISTRATIVE

28 MEMBER AGENCY SUPPORT & CONTRACT COMPLIANCE29 RATE REVIEW30 FACILITY IMPROVEMENT OVERSIGHT31 CONTRACT ANNUAL AUDITING32 COLLECTION SERVICES FRANCHISE ADMIN.33 FINANCE ANALYSIS SUPPORT34 RECYCLING TECHNICAL ASSISTANCE 35 WASTE CHARCTERIZATION SUPPORT36 COLLECTION RFP CONSULTING SUPPORT37 BATTERY MANAGEMENT PLANNING3839 TOTAL MA SUPPORT & CONTRACT COMPLIANCE

40 STATE MANDATED PUBLIC EDUCATION & OUTREACH41 STATE'S REQUIRED ANNUAL REPORTS42 SBWMA ANNUAL REPORT43 DIVERSION PROGRAM SUPPORT44 EVENT GIVEAWAYS45 LONG RANGE PLAN

ACTUAL FY18/19


MID-YEAR BUDGET FY19/20

Jul1 - Dec31 2020

Jan1 - Jun30 2021




Budget Staff Notes

644,440$ 738,094$ 781,264$ 395,466$ 395,466$ 790,932$ 52,838$ 7.2% Jm No COLA increases. Mgmt Analyst grade level increase in 2019 and included benefits expense.767,238 1,010,341$ 983,683 552,345$ 552,345$ 1,104,690 94,349$ 9.3% Jm No COLA increases. Addition of part-time limited term Project Engineer (expires 12/31/2024)140,587 90,000$ 120,000 70,000$ 70,000$ 140,000 50,000$ 55.6% JLM Support for Executive Director/Agency. Continued complex contracting & regulation support.

5,271 7,000$ 7,300 5,750$ 1,750$ 7,500 500$ 7.1% CU $4K for Holiday lunch, and $2K for refreshments at Board meetings, community room rental fee. Extra study session & holida150,500 170,059$ 144,759 66,400$ 64,970$ 131,369 (38,690)$ -22.8% Jm City of Redwood City Accounting Svcs Agreement Year 2

29,145 31,930$ 31,930 19,450$ 19,450$ 38,900 6,970$ 21.8% CU35,186 40,000$ 42,815 6,500$ 6,500$ 13,000 (27,000)$ -67.5% JA Website hosting, maintenance, and updates/upgrades as needed

6,065 8,896$ 8,896 6,825$ 2,275$ 9,100 204$ 2.3% Jm Fees paid to auditors to prepare FY & CY financial statements48,470 48,470$ 48,354 24,902$ 24,902$ 49,805 1,335$ 2.8% Jm Annual insurance premium for director's and officer's insurance16,219 6,271$ 6,271 3,229$ 3,229$ 6,459 188$ 3.0% Jm Bank fees on checking account and fees paid to BNY as the Bond Trustee56,102 58,000$ 62,550 30,000$ 30,000$ 60,000 2,000 3.4% CU Office rent from San Carlos with 3.5% increase every Jan.1. Space at Chamber of Commerce

226 300$ - -$ -$ - (300)$ -100.0% CU Cost is covered in the Accounting Services Agreement21,405 41,480$ 41,480 30,000$ 15,000$ 45,000 3,520$ 8.5% CU Includes phone and janitor services. Office phone system upgrade; current is obsolete.

6,426 30,000$ 32,000 16,000$ 16,000$ 32,000 2,000$ 6.7% CU Potential need for office space at Shoreway Facility and equipment & records storage12,724 19,360$ 19,360 9,815$ 9,815$ 19,630 270$ 1.4% CU Office supplies10,106 11,300$ 11,300 5,100$ 5,100$ 10,200 (1,100)$ -9.7% CU Base copier lease is $600/month plus cost per copy

-$ 1,500 3,500$ 2,000$ 5,500 5,500$ #DIV/0! GL Anticipated public procurement notices2,634 3,500$ 3,500 1,750$ 1,750$ 3,500 -$ 0.0% CU Memberships to trade and community organizations (CRRA, SWMA, NCRA, CCAC )1,389 1,320$ 1,320 700$ 700$ 1,400 80$ 6.1% CU Reimbursement for business use of personal cars (non-auto allowance-eligible employees/fellows).1,437 1,000$ 1,750 875$ 875$ 1,750 750$ 75.0% CU Cell phone business expense. Increased participation by Management Team.

22,351 18,000$ 18,000 9,000$ 9,000$ 18,000 -$ 0.0% CU CRRA conference, progress seminar, SWANA meetings, lunch for SBWMA meetings, State of the City addresses5,016 7,500$ 8,500$ 3,750$ 3,750$ 7,500$ -$ 0.0% CU Professional development opportunities. CCAC training, etc. Retreat & additional management leadership class.

29,000 35,000$ 35,000 17,500$ 17,500$ 35,000 -$ 0.0% CU Industry Sponsorships: CAW,CRRA,SWANA, Acterra, Sustainable San Mateo, CPSC, NCRA

25,853 45,000$ 45,000 25,000$ 25,000$ 50,000 5,000$ 11.1% JAMandated agency priorities include these initiatives : Extended Producer Responsibility (EPR); Product Stewardship; Source Reduction Initiatives; Lithium-ion Battery safety

11,807 10,000$ 10,000 5,000$ 5,000$ 10,000 -$ 0.0% CU2,049,595$ 2,432,820$ 2,466,532$ 1,308,857$ 1,282,377$ 2,591,234$ 158,414$ 6.5%

24,918$ 31,520$ 31,520$ 31,520$ -$ 31,520$ -$ 0.0% Jm Consultant Rate Application Support.75,000$ 75,000 120,000 80,000 200,000 125,000$ 166.7% HG Engineering and construction management support ($95K). Airport feasability consultants ($105K).

49,820$ 51,030$ 51,030 - 56,133 56,133 5,103$ 10.0% Jm Annual Financial & Systems Audit of RSMC and SBR50,315 50,000$ 50,000 25,000 25,000 50,000 -$ 0.0% JLM Franchise Administration compliance consulting. Alternative Fuels Consultation92,409 19,200$ 19,200 10,800 10,800 21,600 2,400$ 12.5% Jm On-Call consultant support as needed. 11,843 90,000$ 90,000 37,500 37,500 75,000 (15,000)$ -16.7% JLM Diversion consultant support; AB1383 planning

60,000$ 50,000 30,000 30,000 60,000 -$ 0.0% HG/JL Waste characterization studies to support OREX Pilot Project100,903 30,000$ 30,000 20,000 20,000 40,000 10,000$ 33.3% JLM Anticipated RFPs

36,114 40,000$ 40,000 - - - (40,000)$ -100.0% JA Absorbed into the Battery outreach one below (line 57). Battery program change is complete.

366,321$ 446,750$ 436,750$ 274,820$ 259,433$ 534,253$ 87,503$ 19.6%

26,864$ 32,000$ 32,000$ 31,000$ 2,000$ 33,000$ 1,000$ 3.1% JA Annual AB 939 EAR submittal for 10-MAs1,962 2,500$ 2,500 - 2,500 2,500 - 0.0% JA Creation of SBWMA annual report4,392 90,000$ 90,000 25,000 25,000 50,000 (40,000) -44.4% JA Public spaces recycling assistance ($30k); Diversion program support ($20k) 4,753 7,500$ 7,500 3,000 4,500 7,500 - 0.0% JA

-$ - -$ -$ - - #DIV/0! GL

Draft FY2021 Budget v2 Expenses - Pages 1 of 25/4/2020

11:12 AM_________________________________________________ SBWMA FINANCE COMMITTEE PACKET 05/12/2020



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line EXPENDITURE SUMMARY46 DIVERSION/COMPLIANCE; ZERO WASTE PROGRAMS47 IN-SCHOOL ENVIRONMENTAL EDUCATION48 LARGE EVENT & VENUE SUPPORT49 CLIMATE ACTION PLANNING50 RECYCLING TECHNICAL ASSISTANCE51 COMMERCIAL/MFD CONTAINERS52 MULTI-FAMILY OUTREACH53 MEMBER AGENCY & RATE PAYER EDUCATION54 RESIDENTIAL OUTREACH PROGRAMS55 COMMUNITY EVENTS56 HHW PROGRAM OUTREACH57 BATTERY OUTREACH

58 SHRED EVENT SERVICE

59 TOTAL STATE MANDATED PUBLIC EDUCATION & OUTREACH60 SBWMA PROGRAM BUDGET

61 SB1383 COMPLIANCE62 TOTAL SBWMA PROGRAM BUDGET

63 SHOREWAY OPERATIONS64 OPERATING CONTRACT - SBR OPERATIONS 65 DISPOSAL66 INSURANCE SHOREWAY67 SHOREWAY FACILITY COST 68 CREDIT CARDS CHARGES69 SHOREWAY CHARGES70 EDUCATION CENTER OPERATIONS71 SHOREWAY MRF EQUIP. MAINTENANCE > $10k72 SEWER FEES (PROPERTY TAX)73 E-RECYCLING74 SUB SHOREWAY OPERATIONS COST

75 TOTAL SHOREWAY OPERATION

76 TOTAL OPERATING EXPENSES77 NON-OPERATING EXPENSES78 LOSS ON SALE OF PROPERTY79 DEBT SERVICE BOND INTEREST80 FRANCHISE FEE TO CITY OF SAN CARLOS81 TOTAL NON-OPERATING EXPENSES

82 TOTAL SHOREWAY OPERATING EXPENSES

83TOTAL EXPENSES (SBWMA Program + All Shoreway Operations)

ACTUAL FY18/19



Jul1 - Dec31 2020

Jan1 - Jun30 2021




Budget Staff Notes241,450 105,000$ 90,000 37,500 37,500 75,000 (30,000) -28.6% JLM Zero Waste Committee initiatives - tech and consulting support

65,000$ 45,000 16,000 16,000 32,000 (33,000) -50.8% EH Materials ($6K), storage/transport ($12K), recognition ($5K), staff/tech support ($40K). Previously budgeted on line 46.11,704 -$ - - - - - #DIV/0! EH16,051 25,000$ 25,000 - 25,000 25,000 - 0.0% GL Annual climate register & Member Agency support.

1,324 85,000$ 85,000 42,500 42,500 85,000 - 0.0% JA AB 1826 & AB 341 Compliance ($10k); Promote reusables for businesses ($60k); Recycling Technical Assistance($15k)44,529 35,000$ 35,000 17,000 17,000 34,000 (1,000) -2.9% JA MFD recycle bags, internal containers, MA containers per Franchise Agreements20,368 90,000$ 90,000 45,000 45,000 90,000 - 0.0% JA Education and outreach per FA; compliance with state laws; MFD Toolkit and other outreach63,020 110,000$ 110,000 65,000 45,000 110,000 - 0.0% JA Biannual newsletters to Member Agency residents. 60,442 90,000$ 90,000 45,000 45,000 90,000 - 0.0% JA Education and outreach per FA, Annual Service Notice mailing.22,630 52,500$ 45,000 25,000 25,000 50,000 (2,500) -4.8% EH Earth Day ($15K), Rethink Recycling Day ($10K), Fixit Clinics ($25K)

30,000$ 30,000 15,000 15,000 30,000 - 0.0% JA Annual promotion of local HHW disposal options for all ratepayers84,463 90,000$ 90,000 55,000 35,000 90,000 - 0.0% JA Educate residents and businesses about risk of battery fires and proper disposal options, including MFD battery bucket

(2,882) 30,000$ 30,000 15,000 15,000 30,000 - 0.0% EHShred, e-waste, and compost events for Member Agencies (coordination, support, outreach, etc.) RFP for Shredding Services

- -$ - - 601,071$ 939,500$ 897,000$ 437,000$ 397,000$ 834,000$ (105,500)$ -11.2%

3,016,987$ 3,819,070$ 3,800,282$ 2,020,677$ 1,938,810$ 3,959,487$ 140,417$ 3.7%

- -$ - 359,750 567,250 927,000 927,000 Source: HFH Presentation 3/20/2020 - Cash Flow Projection Slide 39 (FY19/20 & FY20/21). Includes 1.0 Net New FTE (Program Manager II)

3,016,987$ 3,819,070$ 3,800,282$ 2,380,427$ 2,506,060$ 4,886,487$ 1,067,417$ 27.9%

21,029,629$ 20,941,990$ 20,701,545$ 10,751,260$ 10,865,197$ 21,616,457$ 674,467 3.2% Jm18,817,076 20,026,803$ 20,485,690 10,891,045 12,320,840 23,211,880 3,185,077 15.9% Jm

884,827 999,117$ 985,459 532,062 532,062 1,064,125 65,008 6.5% Jm Property insurance premium. Estimated increase.205,145 200,000$ 200,000 100,000 100,000 200,000 - 0.0% HG Budget for unanticipated routine Shoreway maintenance items that are non-CapEx

77,968 123,610$ 106,702 45,597 45,597 91,194 (32,416) -26.2% Jm SBR pass through of credit card fees from their bank from public customers.26,690 26,690$ 26,690 13,345 - 13,345 (13,345) -50.0% Jm Full amortization of 2015 additional trailer cost in December 2020.61,616 65,000$ 65,000 32,500 32,500 65,000 - 0.0% EH Tours program equipment, school bus services, poster and art contests.

126,956 50,000$ 50,000 50,000 50,000 100,000 50,000 100.0% HG Unanticipated MRF equipment maintenance (non-CapEx) expense 70,623 70,278$ 90,426 45,213 45,213 90,426 20,148 28.7% Jm Actual sewer charge from City of San Carlos on tax bill based on prior year water usage30,364 19,346 61,661 44,136 44,136 88,273 68,927 356.3% E-waste market has shifted from a revenue source to expense. Previously budgeted as revenue

41,330,894$ 42,542,834$ 42,773,172$ 22,505,159$ 24,035,545$ 46,540,700$ 3,997,866$ 9.4%

41,330,894$ 42,542,834$ 42,773,172$ 22,505,159$ 24,035,545$ 46,540,700$ 3,997,866$ 9.4%

44,347,881$ 46,361,903$ 46,573,454$ 24,885,586$ 26,541,605$ 51,427,187$ 5,065,282$ 10.9%

2,633,833$ 2,836,101$ 2,384,556$ 1,201,667$ 1,201,667$ 2,403,333$ (432,767) -15.3% Jm Budgeted interest expense 2019 Bond Issuance2,206,790 2,340,169 2,347,870 1,225,474 1,225,474 2,450,948 110,779 4.7% Jm 5% Franchise Fees paid by JPA to the City of San Carlos on tip fee revenue.

4,840,623$ 5,176,269$ 4,732,426$ 2,427,141$ 2,427,141$ 4,854,281$ (321,988)$ -6.2%

46,171,517$ 47,719,103$ 47,505,598$ 24,932,299$ 26,462,686$ 51,394,981$ 3,675,878$ 7.7%

49,188,504$ 51,538,173$ 51,305,879$ 27,312,726$ 28,968,746$ 56,281,468$ 4,743,294$ 9.2% 4,743,295$


11:12 AM_________________________________________________ SBWMA FINANCE COMMITTEE PACKET 05/12/2020



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Ox Mtn. new increase rates for full year. BVON Organics processing increase 77% (Jan 1, 2021)

FY20/21 BUDGET

CAPITAL EXPENDITURE BUDGET Year 1 Year 2 Year 3 Year 4 Year 5 Description

Mid-Year Update

Proposed Budget

Proposed Budget

Proposed Budget

Proposed Budget

Capital Project Name FY19/20 FY20/21 FY21/22 FY22/23 FY22/23

1 Site paving repairs and restriping2 45,000 45,000 1,500,000 Repaving of collection fleet parking area. Planned after fuel tank removal project.2 Truck shop building maintenance 25,000 125,000 25,000 25,000 25,000 Place holder for unanticipated capital needs.3 TS building and tip floor 200,000 50,000 50,000 50,000 50,000 Tip floor resurfacing needs to be completed4 MRF building and tip floor - 75,000 50,000 100,000 50,000 Not anticipating this work5 Admin building maintenance 40,000 40,000 40,000 40,000 40,000 Place holder for unanticipated capital needs.6 Site maintenance 50,000 150,000 50,000 50,000 50,000 Place holder for unanticipated capital needs.7 Leachate Pumps 100,000 100,000 Failing bunker pumps8 Replace Optical Sorter Software & Hardware 841,500 Equipment (without sales tax) approved by Board (Reso #44). Funded by Equipment Replace Reserve

9 Fire suppression 100,000 100,000 100,000 100,000 Place holder for unanticipated capital needs. The agency has an interest in implementing new fire prevention technologies but does not have a specific project planned.

10 - - - - - Place holder for unanticipated capital needs.

11 Storm Water Treatment System 236,500 50,000 50,000 50,000 50,000 Compliance new SW regulations require treatment of site storm water prior to release. Board Resolution # 2019-58 approved expenditure of $236,500.

12 - 13 Enhancements to Public Recycling Center 50,000 - - - - Need to remove from final FY 19/20 budget. Project budgeted and completed in FY 18/1914 Shredding to Public Recycling Center 100,000 Agency has interest in providing confidential document shredding services as benefit to residents. 17 CIP Projects (See detail) 6,980,109 8,900,000 8,000,000 6,500,000 10,000,000 18 8,668,109 9,635,000 8,365,000 8,515,000 10,265,000

19 FUNDING SOURCE20 Bond Proceeds ($20M) 6,980,109 8,900,000 4,119,891 - - 21 Capital Reserve 1,688,000 735,000 4,245,109 8,515,000 10,265,000 22 8,668,109 9,635,000 8,365,000 8,515,000 10,265,000

23 CIP Project Detail Year 1 Year 2 Year 3 Year 4 Year 524 Organics 2 Energy Pilot 1,250,000 Project approved by BOD. Anticipated start date 1/2020.25 Phase I MRF Upgrades 5,730,109 900,000 BOD Approval resolution numbers 2019-45 and 2019-5426 Phase II MRF Upgrades 3,000,000 3,000,000 Project to be designed after assessment of Phase I improvements and market conditions27 Organics 2 Energy Full Project 5,000,000 5,000,000 Project to be designed after assessment of Pilot O2E and market conditions28 BAAQMD Anticipated compliance 10,000,000 Biofilters for BAAQMD air control for proposed regulations 13.229 Underground Storage Tank Removal 1,500,000 Existing UST tanks are single wall and need to be removed using Remediation Reserve.30 New Fueling System Project 2,500,000 System design pending replacement collection fleet fuel decision. 31 New Biogas Fueling System 2,500,000 Same as above. Tied to O2E and planned GHG reduction goals. 32 6,980,109 8,900,000 8,000,000 6,500,000 10,000,000

Total Funding Source

Total CIP Project Detail

Total Budget for Capital Projects

Line

Draft FY2021 Budget v2 CAPITAL5/4/2020

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FY20/21 BUDGET

1 UNCOMMITTED RESERVE:2 RATE STABILIZATON (9% of expense) 4,100,000$ 4,636,694$ 4,617,529$ 5,065,332$ 428,638$ 3 EMERGENCY RESERVE (9% of expense) 4,454,754 4,636,694 4,617,529 5,065,332 428,638 4 Sub-Emergency Reserve (Prop Ins Premium) 113,985 113,985 113,985 - 5 CAPITAL RESERVE 4,886,222 7,810,492 8,872,542 7,413,410 (397,083) 6 UNDESIGNATED RESERVE 1,479,798 - 7 TOTAL UNCOMMITTED RESERVES 14,920,774$ 17,197,866$ 18,221,586$ 17,658,059$ 460,193$ 8 COMMITTED RESERVE 32,008,265$ 9 EQUIPMENT REPLACEMENT (ANNUAL) 1,397,514$ 1,008,014$ 766,789$ 982,551$ (25,463)$ 10 BOND PROCEEDS 15,085,028$ 13,019,891$ 4,119,891$ (10,965,137)$

11 TOTAL RESERVES 16,318,288$ 33,290,908$ 32,008,265$ 22,760,501$ (10,530,407)$ proof -$ 15,920,070 -$

12 SHOREWAY REMEDIATION PROJECT 1,233,640$ 1,233,640$ 1,233,640$ 1,233,640$ -$

FY20/21 BUDGET: RESERVE BALANCES



PRELIMINARY BUDGET FY20/21


ACTUAL FY18/19

Draft FY2021 Budget v2Reserves Cash Flow

5/4/20201:21 PM




FY20/21 BUDGET

Attachment B - FY20/21 Budget Support Files: REVENUE, EXPENSE DETAILUpdate: April 2020Summary Tables

Table B.1

FY19/20 Adopted Budget

FY19/20 Mid-Year Budget

FY20/21 Proposed

BudgetFY21 vs. FY20

Adopted Budget Variance %Franchise Revenue

Tons 298,681 295,975 298,410 (271) -0.1%Wtd Avg.Tip Fee 123.98$ 123.98$ 127.52$ 3.54 2.9%Franchise Revenue 37,030,309$ 36,695,234$ 38,051,775$ 1,021,466$ 2.8%

Public RevenueCu/Yards 207,466 214,237 210,181 2,715 1.3%Wtd Avg.Tip Fee 42.88$ 42.85$ 47.46$ 4.58 10.7%Public Revenue Cu/YDS 8,896,073$ 9,180,186$ 9,975,660$ 1,079,586$ 12.1%Tons ( 3rd party - mostly Recology) 18,194 18,311 17,142 (1,052) -5.8%Wtd Avg.Tip Fee 127.07$ 127.26$ 129.46$ 2.39 1.9%Public Revenue Tons 2,311,880$ 2,330,380$ 2,219,124$ (92,756)$ -4.0%

Public Dirt Tons 8,221 9,986 10,543 2,323 28.3%Wtd Avg.Tip Fee 110.00$ 110.00$ 115.93$ 5.93 5.4%Sub Total 904,297$ 1,098,489$ 1,222,319$ 318,021$ 35.2%

Public Revenue Total 12,112,251$ 12,609,055$ 13,417,102$ 1,304,851$ 10.8%Total Tip Fee Revenue 49,142,560$ 49,304,289$ 51,468,877$ 2,326,317$ 4.7%

TIP FEE REVENUE

Attachment BDraft FY2021 Budget v2 Page 1 of 5

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FY20/21 BUDGET

Table B.2

Total TS Tonnage and YardsFY19/20

Adopted Budget


FY20/21 Proposed

BudgetFY21 vs. FY20

Adopted Budget Variance %Franchise tonsSBWMA Solid Waste tons 182,013 181,305 180,722 (1,291) -0.7%SBWMA Organics tons 88,121 86,560 89,142 1,020 1.2%SBWMA Food Waste tons 24,630 24,556 24,648 18 0.1%SBWMA Dirt, Inert, Other tons 3,917 3,554 3,899 (19) -0.5% Sub-total Franchise 298,681 295,975 298,410 (271) -0.1%Public tonsNon-SBWMA SW tons 4,161 4,707 4,420 258 6.2%Non-SBWMA Scrap tons 307 263 188 (119) -38.7%Non-SBWMA FOOD tons 4,766 4,681 4,420 (346) -7.3%Non-SBWMA C&D tons 7,025 6,417 5,587 (1,438) -20.5%Non-SBWMA ORGANIC tons 368 349 433 66 17.9%Non-SBWMA Asphalt Roofing tons 1,568 1,895 2,094 526 33.6%Non-SBWMA Clean Wood tons 0 0 0 - 0.0%Public Weighed Dirt ton 8,221 9,986 10,543 2,323 28.3% Sub-Total Public tons 26,415 28,298 27,685 1,270 4.8%Total Tons 325,096 324,273 326,095 999 0.3%Public Cu/Yds.Public Solid Waste Yards C/Yds 62,546 66,227 64,444 1,898 3.0%Public Green Waste Yards C/Yds 48,320 49,855 52,920 4,600 9.5%Public C&D C/Yds 96,600 98,155 92,817 (3,783) -3.9%Total Cubic Yards 207,466 214,237 210,181 2,715 1.3%

TRANSFER STATION VOLUME


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FY20/21 BUDGET

Table B.3

A. SummaryFY19/20

Adopted Budget


FY20/21 Proposed

BudgetFY21 vs. FY20

Adopted Budget Variance %MRF 7,613,837$ 7,178,224$ 7,823,623$ 209,786$ 2.8%Transfer Station 5,189,041 5,265,748 5,416,845 227,805$ 4.4%Transportation 8,098,228 8,216,689 8,365,182 266,955$ 3.3%Interest 40,885 40,885 10,806 (30,079)$ -73.6%

TOTAL SBR EXPENSE 20,941,990$ 20,701,545$ 21,616,457$ 674,467$ 3.2%

B. SBR Expense DetailFY19/20

Adopted Budget


FY20/21 Proposed

BudgetFY21 vs. FY20

Adopted Budget Variance %MRF

Tons, Inbound 72,150 71,790 73,719 1,569 2.2%Tons, residue (12,901) (12,810) (12,810) 91 -0.7%Tons, net sold 59,249 58,980 60,909 1,660 2.8%Wtd Avg.Rate * 120.02$ 113.84$ 120.99$ 0.98$ 0.8%Expense 7,110,815$ 6,714,273$ 7,369,628$ 258,813$ 3.6%

MRF Additional Sorters 503,022$ 463,951$ 453,995$ (49,027)$ -9.7%Transfer Station

Tons 390,532 396,030 396,740 6,209 1.6%Wtd Avg.Rate 13.29$ 13.30$ 13.65$ 0.37$ 2.8%Expense 5,189,041$ 5,265,748$ 5,416,845$ 227,805$ 4.4%

TransportationTons 390,532 396,030 396,740 6,209 1.6%Wtd. Avg. Rate 20.74$ 20.75$ 21.08$ 0.35$ 1.7%Expense 8,098,228$ 8,216,689$ 8,365,182$ 266,955$ 3.3%

Interest 40,885$ 40,885$ 10,806$ (30,079)$ -73.6%

TOTAL SBR "PAID" TONS 840,312 851,040 854,389 14,077 1.7%TOTAL SBR EXPENSE 20,941,990$ 20,701,545$ 21,616,457$ 674,467$ 3.2%

* Wtd Avg reduction due to credit issued by SBR correcting prior years compensated profit related to VRS Program

SBR OPERATING EXPENSE


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FY20/21 BUDGET

Table B.4



FY20/21 Proposed

BudgetFY21 vs. FY20

Adopted Budget Variance %A. Summary

Solid Waste $ 10,511,836 $ 10,609,691 $ 11,794,209 $ 1,282,373 12.2%Organics $ 6,280,246 $ 6,292,011 $ 7,796,296 $ 1,516,050 24.1%C&D, dirt $ 3,282,825 $ 3,619,062 $ 3,730,135 $ 447,310 13.6%Other $ 443,263 $ 453,021 $ 447,821 $ 4,558 1.0%Subtotal $ 20,518,170 $ 20,973,785 $ 23,768,461 $ 3,250,291 15.8%Paid by SBR on MRF residue $ (491,368) $ (488,096) $ (556,581) $ (65,213) 13.3%

TOTAL DISPOSAL EXPENSE $ 20,026,803 $ 20,485,690 $ 23,211,880 $ 3,185,077 15.9%

B. DetailSolid Waste (Ox Mtn.)

Tons, net 220,793 222,760 221,471 678 0.3%Wtd Avg.Rate 47.61$ 47.63$ 53.25$ 5.64$ 11.9%Expense 10,511,836$ 10,609,691$ 11,794,209$ 1,282,373 12.2%

Organics (Newby, Grover)Tons, net 123,864 122,669 124,682 817 0.7%Wtd Avg.Rate 50.70$ 51.29$ 62.53$ 11.83$ 23.3%Expense 6,280,246$ 6,292,011$ 7,796,296$ 1,516,050 24.1%

C&D (Zanker)Tons, net 45,874 50,601 50,588 4,713 10.3%Wtd Avg.Rate 71.56$ 71.52$ 73.74$ 2.17$ 3.0%Expense 3,282,825$ 3,619,062$ 3,730,135$ 447,310 13.6%

OtherTires 4,022$ 5,380$ 4,980$ 958$ 23.8%Appliances 40,240$ 41,120$ 41,120$ 880$ 2.2%Hazardous Waste 389,714$ 397,788$ 392,788$ 3,075$ 0.8%Sharps, Misc. 9,287$ 8,733$ 8,933$ (355)$ -3.8%

Expense 443,263$ 453,021$ 447,821$ 4,558$ 1.0%Summary

TS Tons 390,532 396,030 396,740 6,209 1.6%Wtd Avg.Rate 51.28$ 51.73$ 58.51$ 7.23$ 14.1%

Disposal Expense 20,026,803$ 20,485,690$ 23,211,880$ 3,185,077$ 15.9%

DISPOSAL & PROCESSING EXPENSE


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FY20/21 BUDGET

Table B.4a (subset of Disposal Expense - Organics, only, Detail)



FY20/21 Proposed

BudgetFY21 vs. FY20

Adopted Budget Variance %Organics (Newby)

Tons, net 49,812 52,178 49,782 (29) -0.1%Wtd Avg.Rate 68.45$ 68.45$ 70.82$ 2.37$ 3.5%Expense 3,409,645$ 3,571,690$ 3,525,616$ 115,972 3.4%

Organics (Grover)Tons, net 74,053 70,491 74,899 846 1.1%Wtd Avg.Rate 38.76$ 38.59$ 57.02$ 18.25$ 47.1%Expense 2,870,602$ 2,720,321$ 4,270,680$ 1,400,079 48.8%

Total OrganicsTons, net 123,864 122,669 124,682 817 0.7%Wtd Avg.Rate 50.70$ 51.29$ 62.53$ 11.83$ 23.3%Total Organics Expense 6,280,246$ 6,292,011$ 7,796,296$ 1,516,050 24.1%

ORGANICS PROCESSING EXPENSE DETAIL


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ATTACHMENT C: To be added for the 05/28/2020 Board Meeting


FY20/21 BUDGET

COMMODITY REVENUE


FY20/21 Proposed

Budget

FY21 vs. FY20 Adopted Budget Variance %

Tons Sold 59,249 60,909 1,660 2.8%Wtd Avg. Price 115.41$ 95.86$ (19.55)$ -16.9%

Gross Revenue 6,838,073$ 5,838,829$ (999,244)$ -14.6%Revenue Share w/ SBR (395,652)$ (50,838)$ 344,814$ -87.2%Buyback Payments (843,906) -$ 843,906$ -100.0%

Net Commodity Revenue 5,598,516$ 5,787,991$ 189,475$ 3.4%

Price / Volume Impact Price Volume TotalTonnage Change 115.41 1,660 191,576$ Price Change (19.55)$ 60,909 (1,190,820)$ Total Change (Gross) (999,244)$

COMMODITY REVENUE

Attachment DDraft FY2021 Budget v2 Page 1 of 1

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____________________________________________________ __________________________________________________________ AGENDA ITEM: 10 ATTACHMENT D - p1


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Attachment A - FY20/21 Budget Revenues by Major Source

REVENUE SUMMARYACTUAL FY18/19


MID-YEAR BUDGET FY 19/20

Jul1 - Dec31 2020

Jan1 - Jun30 2021




Budget Notes

1 ADMINISTRATIVE REVENUE:2 INVESTMENT INCOME 621,287$ 376,994$ 757,835$ 303,686$ 273,770$ 577,455$ 200,461$ 53.2%3 TOTAL ADMINISTRATIVE 621,287$ 376,994$ 757,835$ 303,686$ 273,770$ 577,455$ 200,461$ 53.2%

4 OPERATIONS REVENUE:

5 SHOREWAY TIP FEES - Non Franchised 11,694,389$ 12,112,251$ 12,609,055$ 6,130,693 6,206,877 12,337,569$ 225,318$ 1.9%

6 SHOREWAY TIP FEES - Franchised 34,710,487 37,030,309 36,695,234 17,027,991 18,184,889 35,212,880$ (1,817,429) -4.9%

7 COMMODITY SALES REVENUE 6,579,151 6,838,073 5,755,713 2,919,415 2,919,415 5,838,829 (999,244) -14.6%

8 COMMODITY REVENUE SHARING W/ SBR (438,837) (395,652) (297,884) - (50,838) (50,838)$ 344,814 -87.2%9 BUY BACK CENTER - Payment to Customers (894,670) (843,906) (163,039) - - - 843,906 -100.0%10 MISCELLANEOUS REVENUE 28,324 19,160 19,219 6,774 6,774 13,548 (5,612) -29.3%

11 SUBTOTAL OPERATIONS REVENUE 51,678,845$ 54,760,235$ 54,618,298$ 26,084,872$ 27,267,116$ 53,351,988$ (1,408,248)$ -2.6%22

12 TOTAL OPERATING REVENUES 51,678,845$ 54,760,235$ 54,618,298$ 26,084,872$ 27,267,116$ 53,351,988$ (1,408,248)$ -2.6%

13 NON-OPERATING RECEIPTSGRANT REVENUE 1,020,000$ 1,000,000

14 TOTAL REVENUE 53,320,131$ 55,137,230$ 56,376,132$ 26,388,558$ 27,540,885$ 53,929,443$ (1,207,787)$ -2.2%

15 TOTAL OPERATING EXPENSES 49,188,504$ 51,538,173$ 51,305,880$ 25,903,427$ 27,362,236$ 53,265,636$ 1,727,463$ 3.4%

16 NET OPERATING INCOME 4,131,627$ 3,599,057$ 5,070,252$ 485,131$ 178,649$ 663,808$ (2,935,249)$ -81.6%

Draft FY2021 Budget v2 Revenues5/4/2020

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_______________________________________________________________________________________________________________________________________________________ __________________________________________________________ AGENDA ITEM: 10 ATTACHMENT E - p1


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Alternative Budget with reduced volume (Solid Waste -5%, Organics -5%, C&D -5%, Food Waste -35%)

line EXPENDITURE SUMMARY1 ADMINISTRATIVE EXPENSES2 ADMINISTRATIVE STAFF3 MANDATED COMPLIANCE SUPPORT STAFF4 BOARD COUNSEL5 BOARD MEETINGS6 ACCOUNTING SERVICES7 INFORMATION SYSTEMS 8 WEBSITE 9 ANNUAL AUDIT10 D&O INSURANCE 11 BANK FEES12 RENT13 PRINTING AND POSTAGE14 UTILITIES15 OFFICE/TENANT IMPROVEMENTS16 OFFICE SUPPLIES17 OFFICE EQUIPMENT COSTS 18 PUBLICATIONS & PUBLIC NOTICES19 PROFESSIONAL DUES & MEMBERSHIPS20 VEHICLE MILEAGE & TOLLS21 CELL PHONES22 CONFERENCE & MEETINGS23 TRAINING24 SPONSORSHIPS & DONATIONS

25 LEGISLATIVE & REGULATORY ADVOCACY26 COMPUTER PURCHASE27 TOTAL ADMINISTRATIVE

28 MEMBER AGENCY SUPPORT & CONTRACT COMPLIANCE29 RATE REVIEW30 FACILITY IMPROVEMENT OVERSIGHT31 CONTRACT ANNUAL AUDITING32 COLLECTION SERVICES FRANCHISE ADMIN.33 FINANCE ANALYSIS SUPPORT34 RECYCLING TECHNICAL ASSISTANCE 35 WASTE CHARCTERIZATION SUPPORT36 COLLECTION RFP CONSULTING SUPPORT37 BATTERY MANAGEMENT PLANNING3839 TOTAL MA SUPPORT & CONTRACT COMPLIANCE

40 STATE MANDATED PUBLIC EDUCATION & OUTREACH41 STATE'S REQUIRED ANNUAL REPORTS42 SBWMA ANNUAL REPORT43 DIVERSION PROGRAM SUPPORT44 EVENT GIVEAWAYS45 LONG RANGE PLAN

ACTUAL FY18/19



Jul1 - Dec31 2020

Jan1 - Jun30 2021




Budget Staff Notes

644,440$ 738,094$ 781,264$ 395,466$ 395,466$ 790,932$ 52,838$ 7.2% Jm No COLA increases. Mgmt Analyst grade level increase in 2019 and included benefits expense.767,238 1,010,341$ 983,683 552,345$ 552,345$ 1,104,690 94,349$ 9.3% Jm No COLA increases. Addition of part-time limited term Project Engineer (expires 12/31/2024)140,587 90,000$ 120,000 70,000$ 70,000$ 140,000 50,000$ 55.6% JLM Support for Executive Director/Agency. Continued complex contracting & regulation support.

5,271 7,000$ 7,300 5,750$ 1,750$ 7,500 500$ 7.1% CU $4K for Holiday lunch, and $2K for refreshments at Board meetings, community room rental fee. Extra study session & holida150,500 170,059$ 144,759 66,400$ 64,970$ 131,369 (38,690)$ -22.8% Jm City of Redwood City Accounting Svcs Agreement Year 2

29,145 31,930$ 31,930 19,450$ 19,450$ 38,900 6,970$ 21.8% CU35,186 40,000$ 42,815 6,500$ 6,500$ 13,000 (27,000)$ -67.5% JA Website hosting, maintenance, and updates/upgrades as needed

6,065 8,896$ 8,896 6,825$ 2,275$ 9,100 204$ 2.3% Jm Fees paid to auditors to prepare FY & CY financial statements48,470 48,470$ 48,354 24,902$ 24,902$ 49,805 1,335$ 2.8% Jm Annual insurance premium for director's and officer's insurance16,219 6,271$ 6,271 3,229$ 3,229$ 6,459 188$ 3.0% Jm Bank fees on checking account and fees paid to BNY as the Bond Trustee56,102 58,000$ 62,550 30,000$ 30,000$ 60,000 2,000 3.4% CU Office rent from San Carlos with 3.5% increase every Jan.1. Space at Chamber of Commerce

226 300$ - -$ -$ - (300)$ -100.0% CU Cost is covered in the Accounting Services Agreement21,405 41,480$ 41,480 30,000$ 15,000$ 45,000 3,520$ 8.5% CU Includes phone and janitor services. Office phone system upgrade; current is obsolete.

6,426 30,000$ 32,000 16,000$ 16,000$ 32,000 2,000$ 6.7% CU Potential need for office space at Shoreway Facility and equipment & records storage12,724 19,360$ 19,360 9,815$ 9,815$ 19,630 270$ 1.4% CU Office supplies10,106 11,300$ 11,300 5,100$ 5,100$ 10,200 (1,100)$ -9.7% CU Base copier lease is $600/month plus cost per copy

-$ 1,500 3,500$ 2,000$ 5,500 5,500$ #DIV/0! GL Anticipated public procurement notices2,634 3,500$ 3,500 1,750$ 1,750$ 3,500 -$ 0.0% CU Memberships to trade and community organizations (CRRA, SWMA, NCRA, CCAC )1,389 1,320$ 1,320 700$ 700$ 1,400 80$ 6.1% CU Reimbursement for business use of personal cars (non-auto allowance-eligible employees/fellows).1,437 1,000$ 1,750 875$ 875$ 1,750 750$ 75.0% CU Cell phone business expense. Increased participation by Management Team.

22,351 18,000$ 18,000 9,000$ 9,000$ 18,000 -$ 0.0% CU CRRA conference, progress seminar, SWANA meetings, lunch for SBWMA meetings, State of the City addresses5,016 7,500$ 8,500$ 3,750$ 3,750$ 7,500$ -$ 0.0% CU Professional development opportunities. CCAC training, etc. Retreat & additional management leadership class.

29,000 35,000$ 35,000 17,500$ 17,500$ 35,000 -$ 0.0% CU Industry Sponsorships: CAW,CRRA,SWANA, Acterra, Sustainable San Mateo, CPSC, NCRA

25,853 45,000$ 45,000 25,000$ 25,000$ 50,000 5,000$ 11.1% JAMandated agency priorities include these initiatives : Extended Producer Responsibility (EPR); Product Stewardship; Source Reduction Initiatives; Lithium-ion Battery safety

11,807 10,000$ 10,000 5,000$ 5,000$ 10,000 -$ 0.0% CU2,049,595$ 2,432,820$ 2,466,532$ 1,308,857$ 1,282,377$ 2,591,234$ 158,414$ 6.5%

24,918$ 31,520$ 31,520$ 31,520$ -$ 31,520$ -$ 0.0% Jm Consultant Rate Application Support.75,000$ 75,000 120,000 80,000 200,000 125,000$ 166.7% HG Engineering and construction management support ($95K). Airport feasability consultants ($105K).

49,820$ 51,030$ 51,030 - 56,133 56,133 5,103$ 10.0% Jm Annual Financial & Systems Audit of RSMC and SBR50,315 50,000$ 50,000 25,000 25,000 50,000 -$ 0.0% JLM Franchise Administration compliance consulting. Alternative Fuels Consultation92,409 19,200$ 19,200 10,800 10,800 21,600 2,400$ 12.5% Jm On-Call consultant support as needed. 11,843 90,000$ 90,000 37,500 37,500 75,000 (15,000)$ -16.7% JLM Diversion consultant support; AB1383 planning

60,000$ 50,000 30,000 30,000 60,000 -$ 0.0% HG/JL Waste characterization studies to support OREX Pilot Project100,903 30,000$ 30,000 20,000 20,000 40,000 10,000$ 33.3% JLM Anticipated RFPs

36,114 40,000$ 40,000 - - - (40,000)$ -100.0% JA Absorbed into the Battery outreach one below (line 57). Battery program change is complete.

366,321$ 446,750$ 436,750$ 274,820$ 259,433$ 534,253$ 87,503$ 19.6%

26,864$ 32,000$ 32,000$ 31,000$ 2,000$ 33,000$ 1,000$ 3.1% JA Annual AB 939 EAR submittal for 10-MAs1,962 2,500$ 2,500 - 2,500 2,500 - 0.0% JA Creation of SBWMA annual report4,392 90,000$ 90,000 25,000 25,000 50,000 (40,000) -44.4% JA Public spaces recycling assistance ($30k); Diversion program support ($20k) 4,753 7,500$ 7,500 3,000 4,500 7,500 - 0.0% JA

-$ - -$ -$ - - #DIV/0! GL


12:10 PM_________________________________________________ SBWMA FINANCE COMMITTEE PACKET 05/12/2020



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line EXPENDITURE SUMMARY46 DIVERSION/COMPLIANCE; ZERO WASTE PROGRAMS47 IN-SCHOOL ENVIRONMENTAL EDUCATION48 LARGE EVENT & VENUE SUPPORT49 CLIMATE ACTION PLANNING50 RECYCLING TECHNICAL ASSISTANCE51 COMMERCIAL/MFD CONTAINERS52 MULTI-FAMILY OUTREACH53 MEMBER AGENCY & RATE PAYER EDUCATION54 RESIDENTIAL OUTREACH PROGRAMS55 COMMUNITY EVENTS56 HHW PROGRAM OUTREACH57 BATTERY OUTREACH

58 SHRED EVENT SERVICE

59 TOTAL STATE MANDATED PUBLIC EDUCATION & OUTREACH60 SBWMA PROGRAM BUDGET

61 SB1383 COMPLIANCE62 TOTAL SBWMA PROGRAM BUDGET

63 SHOREWAY OPERATIONS64 OPERATING CONTRACT - SBR OPERATIONS 65 DISPOSAL66 INSURANCE SHOREWAY67 SHOREWAY FACILITY COST 68 CREDIT CARDS CHARGES69 SHOREWAY CHARGES70 EDUCATION CENTER OPERATIONS71 SHOREWAY MRF EQUIP. MAINTENANCE > $10k72 SEWER FEES (PROPERTY TAX)73 E-RECYCLING74 SUB SHOREWAY OPERATIONS COST

75 TOTAL SHOREWAY OPERATION

76 TOTAL OPERATING EXPENSES77 NON-OPERATING EXPENSES78 LOSS ON SALE OF PROPERTY79 DEBT SERVICE BOND INTEREST80 FRANCHISE FEE TO CITY OF SAN CARLOS81 TOTAL NON-OPERATING EXPENSES

82 TOTAL SHOREWAY OPERATING EXPENSES

83TOTAL EXPENSES (SBWMA Program + All Shoreway Operations)

ACTUAL FY18/19



Jul1 - Dec31 2020

Jan1 - Jun30 2021




Budget Staff Notes241,450 105,000$ 90,000 37,500 37,500 75,000 (30,000) -28.6% JLM Zero Waste Committee initiatives - tech and consulting support

65,000$ 45,000 16,000 16,000 32,000 (33,000) -50.8% EH Materials ($6K), storage/transport ($12K), recognition ($5K), staff/tech support ($40K). Previously budgeted on line 46.11,704 -$ - - - - - #DIV/0! EH16,051 25,000$ 25,000 - 25,000 25,000 - 0.0% GL Annual climate register & Member Agency support.

1,324 85,000$ 85,000 42,500 42,500 85,000 - 0.0% JA AB 1826 & AB 341 Compliance ($10k); Promote reusables for businesses ($60k); Recycling Technical Assistance($15k)44,529 35,000$ 35,000 17,000 17,000 34,000 (1,000) -2.9% JA MFD recycle bags, internal containers, MA containers per Franchise Agreements20,368 90,000$ 90,000 45,000 45,000 90,000 - 0.0% JA Education and outreach per FA; compliance with state laws; MFD Toolkit and other outreach63,020 110,000$ 110,000 65,000 45,000 110,000 - 0.0% JA Biannual newsletters to Member Agency residents. 60,442 90,000$ 90,000 45,000 45,000 90,000 - 0.0% JA Education and outreach per FA, Annual Service Notice mailing.22,630 52,500$ 45,000 25,000 25,000 50,000 (2,500) -4.8% EH Earth Day ($15K), Rethink Recycling Day ($10K), Fixit Clinics ($25K)

30,000$ 30,000 15,000 15,000 30,000 - 0.0% JA Annual promotion of local HHW disposal options for all ratepayers84,463 90,000$ 90,000 55,000 35,000 90,000 - 0.0% JA Educate residents and businesses about risk of battery fires and proper disposal options, including MFD battery bucket

(2,882) 30,000$ 30,000 15,000 15,000 30,000 - 0.0% EHShred, e-waste, and compost events for Member Agencies (coordination, support, outreach, etc.) RFP for Shredding Services

- -$ - - 601,071$ 939,500$ 897,000$ 437,000$ 397,000$ 834,000$ (105,500)$ -11.2%

3,016,987$ 3,819,070$ 3,800,282$ 2,020,677$ 1,938,810$ 3,959,487$ 140,417$ 3.7%

- -$ - 359,750 567,250 927,000 927,000 Source: HFH Presentation 3/20/2020 - Cash Flow Projection Slide 39 (FY19/20 & FY20/21). Includes 1.0 Net New FTE (Program Manager II)

3,016,987$ 3,819,070$ 3,800,282$ 2,380,427$ 2,506,060$ 4,886,487$ 1,067,417$ 27.9%

21,029,629$ 20,941,990$ 20,701,545$ 10,237,308$ 10,355,670$ 20,592,978$ (349,012) -1.7% Jm18,817,076 20,026,803$ 20,485,690 10,088,996 11,317,154 21,406,122 1,379,319 6.9% Jm

884,827 999,117$ 985,459 532,062 532,062 1,064,125 65,008 6.5% Jm Property insurance premium. Estimated increase.205,145 200,000$ 200,000 100,000 100,000 200,000 - 0.0% HG Budget for unanticipated routine Shoreway maintenance items that are non-CapEx

77,968 123,610$ 106,702 45,597 45,597 91,194 (32,416) -26.2% Jm SBR pass through of credit card fees from their bank from public customers.26,690 26,690$ 26,690 13,345 - 13,345 (13,345) -50.0% Jm Full amortization of 2015 additional trailer cost in December 2020.61,616 65,000$ 65,000 32,500 32,500 65,000 - 0.0% EH Tours program equipment, school bus services, poster and art contests.

126,956 50,000$ 50,000 50,000 50,000 100,000 50,000 100.0% HG Unanticipated MRF equipment maintenance (non-CapEx) expense 70,623 70,278$ 90,426 45,213 45,213 90,426 20,148 28.7% Jm Actual sewer charge from City of San Carlos on tax bill based on prior year water usage30,364 19,346 61,661 44,136 44,136 88,273 68,927 356.3% E-waste market has shifted from a revenue source to expense. Previously budgeted as revenue

41,330,894$ 42,542,834$ 42,773,172$ 21,189,157$ 22,522,333$ 43,711,463$ 1,168,629$ 2.7%

41,330,894$ 42,542,834$ 42,773,172$ 21,189,157$ 22,522,333$ 43,711,463$ 1,168,629$ 2.7%

44,347,881$ 46,361,903$ 46,573,454$ 23,569,585$ 25,028,393$ 48,597,950$ 2,236,046$ 4.8%

2,633,833$ 2,836,101$ 2,384,556$ 1,201,667$ 1,201,667$ 2,403,333$ (432,767) -15.3% Jm Budgeted interest expense 2019 Bond Issuance2,206,790 2,340,169 2,347,870 1,132,176 1,132,176 2,264,352 (75,816) -3.2% Jm 5% Franchise Fees paid by JPA to the City of San Carlos on tip fee revenue.

4,840,623$ 5,176,269$ 4,732,426$ 2,333,843$ 2,333,843$ 4,667,686$ (508,584)$ -9.8%

46,171,517$ 47,719,103$ 47,505,598$ 23,523,000$ 24,856,176$ 48,379,148$ 660,045$ 1.4%

49,188,504$ 51,538,173$ 51,305,879$ 25,903,427$ 27,362,236$ 53,265,636$ 1,727,462$ 3.4% 1,727,463$


12:10 PM_________________________________________________ SBWMA FINANCE COMMITTEE PACKET 05/12/2020



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Ox Mtn. new increase rates for full year. BVON Organics processing increase 77% (Jan 1, 2021)

FY20/21 BUDGET

Total TS Tonnage and YardsFY19/20

Adopted Budget


FY20/21 Proposed

BudgetFY21 vs. FY20

Adopted Budget Variance %Franchise tonsSBWMA Solid Waste tons 182,013 181,305 172,409 (9,604) -5.3%SBWMA Organics tons 88,121 86,560 85,087 (3,034) -3.4%SBWMA Food Waste tons 24,630 24,556 15,878 (8,752) -35.5%SBWMA Dirt, Inert, Other tons 3,917 3,554 3,544 (373) -9.5% Sub-total Franchise 298,681 295,975 276,918 (21,763) -7.3%Public tonsNon-SBWMA SW tons 4,161 4,707 4,249 87 2.1%Non-SBWMA Scrap tons 307 263 188 (119) -38.7%Non-SBWMA FOOD tons 4,766 4,681 2,926 (1,840) -38.6%Non-SBWMA C&D tons 7,025 6,417 5,052 (1,973) -28.1%Non-SBWMA ORGANIC tons 368 349 433 66 17.9%Non-SBWMA Asphalt Roofing tons 1,568 1,895 2,094 526 33.6%Non-SBWMA Clean Wood tons 0 0 0 - 0.0%Public Weighed Dirt ton 8,221 9,986 9,469 1,248 15.2% Sub-Total Public tons 26,415 28,298 24,412 (2,004) -7.6%Total Tons 325,096 324,273 301,330 (23,767) -7.3%Public Cu/Yds.Public Solid Waste Yards C/Yds 62,546 66,227 61,565 (981) -1.6%Public Green Waste Yards C/Yds 48,320 49,855 50,208 1,888 3.9%Public C&D C/Yds 96,600 98,155 84,254 (12,345) -12.8%Total Cubic Yards 207,466 214,237 196,028 (11,439) -5.5%

TRANSFER STATION VOLUME


5/4/202012:16 PM




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11

11. Presentation by South BayRecycling (SBR) regarding their

Request

Agenda Item 11



________________________________________________________________________________________________________________ SBWMA FINANCE COMMITTEE MEETING 05/12/2020 AGENDA ITEM: 11 - p1

11

STAFF REPORT To: SBWMA Board Members From: Joe La Mariana, Executive Director Date: May 12, 2020 Finance Committee Meeting Subject: Presentation by South Bay Recycling (SBR) regarding their Request for Compensation

Adjustment

Recommendation This is a discussion item only and no action is required.

Summary On January 10, 2020, SBR sent a letter to the SBWMA requesting an adjustment to their firm’s compensation to operate our agency facilities, long haul transportation and commodity brokering due to several factors that have occurred beyond their control (Attachment 1). Staff asked SBR for supporting documentation to justify their request. Staff received this detail from SBR on February 12, 2020 (Attachments B; 1-5).

Staff and R3 Consulting has provided internal and independent review of SBR’s submitted Attachments 1, 3, 4 and 5, and their basic mathematical computations. Staff has also engaged SBR several times to clarify certain points of their request.

With SBWMA Executive Committee direction, SBR’s senior management team was invited on May 5th to present their request in-person at today’s Finance Committee meeting to provide the company an opportunity to express their request firsthand, and to allow the Finance Committee to pose questions directly to fully understand the scope of this request.

Background Through a formal Request for Proposal (RFP) process conducted in 2009, SBR was selected to operate the SBWMA-owned solid waste facility’s Transfer Station and Material Recovery Facility, conduct long-haul operations of the materials to their processing and/or disposal points, and to move the recyclables at their highest value through their international brokerage unit. There were eight (8) qualified RFP responses. This work is conducted under a master “Operating Agreement” (Agreement) between the SBWMA and SBR. This agreement’s original term was from January 1, 2011 through December 31, 2020. Last July, the SBWMA exercised its unilateral right to extend the Agreement term through December 31, 2023.

Fiscal Impact There is no fiscal impact related to this informational presentation but as a guideline, if an adjustment is made to SBR’s compensation, every $1M of expense incurred in the SBWMA’s Operating Budget roughly results in about a 1% increase in rates to our member agency’s ratepayers.



Attachments Attachment A: SBR Letter--Request to Adjust Compensation (dated January 10, 2020) Attachment B: SBR Letter-Letter to Adjust Compensation with detailed support attachments (February 12, 2020) Attachment 1: SBR’s Component Fees Attachment 2: SBR’s Evidence of China’s Change in Law Attachment 3: Financial Impacts Calculations Attachment 4: Summary of Financial Impacts Attachment 5: SBR’s Operating Expenses























Attachment 1

SBR Component Fees

SBR COMPONENT FEES

2018

Total

Franchise Inbound Tons 324,056.53

Self-Haul Inbound Tons 57,256.79

MRF Inbound Tons 78,919.35

Transfer Station Payment 13.17$ 4,267,824.50$

Transfer Station Self-Haul Payment Calculated Tons 13.17$ 754,071.92$

Franchise MRF Tons 92.27$ 7,281,888.63$

Baled Clean OCC >300 lbs. - Bailing Fee -$

Subtotal Operations 12,303,785.05$

OX Mountain Landfill 3,544,197.17$

OX Mountain Landfill -$

Zanker Road 1,069,383.79$

Newby Island 914,962.55$

Grover 1,476,710.03$

Newby Island -$

Grover 938,895.71$

Livermore Bio Fuels -$

Zanker Road -$

Member Agency Backhauls 4,770.85$

Subtotal Transportation 7,948,920.10$

Total Operations & Transportation 20,252,705.15$

Preceeding Year Qualifier 2% 405,054.10$


____________________________________________________ __________________________________________________________ AGENDA ITEM: 11 ATTACHMENT 1 - p1





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English translation For reference only

Announcement on Adjustment to the Catalogue for the Administration of Import Solid Waste

Announcement No. 6 in 2018

In order to further regulate the administration of importation of solid waste and prevent environment pollution, in accordance with the Law of the People’s Republic of China on the Prevention and Control of Environmental Pollution by Solid Waste, the Measures for the Administration of Importation of Solid Waste, and other applicable laws and regulations, Ministry of Ecology and Environment, Ministry of Commerce, National Development and Reform Commission, and General Administration of Customs shall make the following adjustment to the current Catalogue of Solid Waste Used as Raw Materials under Restricted Import, Catalogue of Solid Waste Used as Raw Materials under Non-Restricted Import, and Catalogue of Banned Import Solid Waste: 1. Sixteen (16) types of solid waste (as set forth in Annex 1 attached hereto), including, among others, metal scraps, scrap vessels, compressed piece of scrap automobile, smelt slag, and industrial waste and scrap of plastics, listed in the Catalogue of Solid Waste Used as Raw Materials under Restricted Import, shall be moved to and included in the Catalogue of Banned Import Solid Waste, effective as of December 31, 2018; and 2. Sixteen (16) types of solid waste (as set forth in Annex 2 attached hereto), including, among others, waste and scrap of stainless steel, titanium wastes and scraps, and wood waste and scrap, listed in the Catalogue of Solid Waste Used as Raw Materials under Restricted Import or Catalogue of Solid Waste Used as Raw Materials under Non-Restricted Import, shall be moved to and included in the Catalogue of Banned Import Solid Waste, effective as of December 31, 2019. In event of any discrepancy between the catalogues enclosed in the Catalogue for the Administration of Import Solid Waste (Announcement No. 37 in 2017 issued by Ministry of Environmental Protection, Ministry of Commerce, National Development and Reform Commission, General Administration of Customs, and General Administration of Quality Supervision, Inspection and Quarantine) and this announcement, this announcement shall prevail. This announcement is hereby issued. Annex: 1. List of Solid Waste to be Included in the Catalogue of Banned Import Solid Waste Effective as of the End of 2018




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2. List of Solid Waste to be Included in the Catalogue of Banned Import Solid Waste Effective as of the End of 2019

Ministry of Ecology and Environment Ministry of Commerce National Development and Reform Commission General Administration of Customs April 13, 2018

Printed and circulated by the Ministry of Ecology and Environment on April 19, 2018.




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Annex 1

List of Solid Waste to be Included in the Catalogue of Banned Import Solid Waste Effective as of the End of 2018

No. HS Code Name of Waste Brief Description Other

Requirements or

Notes

1 2618001001 Manganese-containing granular slag generated during smelting of steel and iron, with a manganese content greater than 25% (including slag sand)

Granular slag generated during smelting of steel and iron, with a manganese content greater than 25%

2 2619000010 Oxide scale generated during steel rolling Oxide scale generated during steel rolling

3 2619000030 Steel and iron residue generated during smelting of steel and iron, with an iron content greater than 80%

Steel and iron residue generated during smelting of steel and iron, with an iron content greater than 80%

4 3915100000 Waste and scrap ethylene polymers and remnants

Waste and scrap ethylene polymers and remnants, excluding aluminum-plastic composite membrane

Industrial waste and scrap of plastics (referring to the thermoplastic remnant materials, leftover materials, and inferior products produced in the manufacture of plastics and

5 Aluminum-plastic composite membrane

6 3915200000 Waste and scrap vinyl benzene polymers and remnants

Waste and scrap vinyl benzene polymers and remnants

7 3915300000 Waste and scrap cholroethylene polymers and remnants

Waste and scrap cholroethylene polymers and remnants




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Requirements or

Notes

8 3915901000 Waste and scrap polyethylene terephthalate and

remnants

Waste and scrap PET and remnants, excluding waste and scrap PET bottles (compressed)

processing of plastic products

9 Waste and scrap PET bottles (compressed)

10 3915909000 Other waste and scrap plastics and remnants

Other waste and scrap plastics and remnants, excluding cracked compact disc scrap

11 Cracked compact disc scrap

12 7204490010 Compressed piece of scrap automobile Compressed piece of scrap automobile

13 7204490020 Metal and electrical appliance scraps mainly for the recovery of iron and steel

Metal and electrical appliance scraps mainly for the recovery of iron and steel

14 7404000010

Metal and electrical appliance scraps mainly for the recovery of copper (including waste electric motors, waste wires and cables, and metal and electrical appliance scraps)

Metal and electrical appliance scraps mainly for the recovery of copper

15 7602000010 Metal and electrical appliance scraps mainly for the recovery of aluminum (including waste wires and cables, and metal and electrical appliance scraps)

Metal and electrical appliance scraps mainly for the recovery of aluminum

16 8908000000 Vessels and other floating structures for breaking up Scrap vessels

Note: The “HS Code” column is for reference only.




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Annex 2

List of Solid Waste to be Included in the Catalogue of Banned Import Solid Waste Effective as of the End of 2019


Requirements

or Notes 1 4401310000 Wood pellet

Wood wastes

2 4401390000 Other sawdust, wood waste and scrap

3 4501901000 Cork waste Cork waste

4 7204210000 Waste and scrap of stainless steel Waste and scrap of stainless steel

5 8101970000 Tungsten wastes and scraps Tungsten wastes and scraps

6 8104200000 Magnesium wastes and scraps Magnesium wastes and scraps

7 8106001092 Other unwrought bismuth wastes and scraps Bismuth wastes and scraps

8 8108300000 Titanium wastes and scraps Titanium wastes and scraps

9 8109300000 Zirconium wastes and scraps Zirconium wastes and scraps

10 8112921010 Unwrought germanium wastes and scraps Germanium wastes and scraps

11 8112922010 Unwrought vanadium wastes and scraps Vanadium wastes and scraps

12 8112924010 Niobium wastes and scraps Niobium wastes and scraps

13 8112929011 Unwrought hafnium wastes and scraps Hafnium wastes and scraps

14 8112929091 Unwrought gallium and rhenium wastes and scraps Gallium and rhenium wastes and scraps




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Requirements

or Notes

15 8113001010 Granular or powdery tungsten carbide wastes and scraps Granular or powdery tungsten carbide wastes and scraps

16 8113009010 Other tungsten carbide wastes and scraps, except for granular or powdery ones

Other tungsten carbide wastes and scraps, except for granular or powdery ones

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Financial Impact Calculations to MRF from Change in Operations

23 20 21 22 23 20 23 22 21 23 21 22 261

Jan'19 Feb'19 Mar'19 Apr'19 May'19 Jun'19 Jul'19 Aug'19 Sep'19 Oct'19 Nov'19 Dec'19

MRF Sort Labor Hours

VRS Sorter Reg 4,724.06 3,782.46 3,717.48 3,705.92 4,436.35 4,364.83 4,060.35 3,721.82 3,258.85 3,667.93 3,097.74 3,240.88 45,778.67

VRS Sorter OT 1,738.14 1,124.42 1,077.30 1,010.41 1,286.73 1,218.49 1,122.07 1,005.02 837.73 884.68 792.50 784.14 12,881.64

VRS Supervisor Reg 176.00 158.00 165.80 198.00 192.50 173.50 183.50 176.00 176.00 183.50 144.00 167.50 2,094.30

VRS Supervisor OT 101.00 54.50 59.30 32.00 81.25 29.00 67.00 58.00 36.50 53.00 81.00 48.80 701.35

VRS Utility Reg 176.00 160.00 177.50 184.00 191.80 168.00 184.00 176.00 168.00 184.00 139.00 176.50 2,084.80

VRS Utility OT 113.50 82.00 34.00 60.00 73.30 46.00 59.50 61.00 54.50 55.50 70.60 20.00 729.90

Nelson Reg 1,394.50 1,854.00 1,866.25 1,672.23 1,563.75 1,355.50 1,551.58 2,047.43 2,187.59 1,697.93 1,550.28 1,624.11 20,365.15

Nelson OT 491.09 615.17 587.99 489.65 601.92 417.08 526.85 758.98 818.84 548.38 500.69 524.54 6,881.18

Total MRF Sort Labor (Hrs) 8,914.29 7,830.55 7,685.63 7,352.21 8,427.60 7,772.40 7,754.85 8,004.25 7,538.01 7,274.92 6,375.82 6,586.47 91,517.00

VRS Invoice based on Rates

VRS Intern Reg 22.35$ 105,582.74$ 84,537.98$ 83,085.75$ 82,827.24$ 99,152.42$ 97,553.95$ 90,748.82$ 83,182.68$ 72,835.30$ 81,978.24$ 69,234.49$ 72,433.74$ 1,023,153.34$

VRS Intern OT 24.00$ 41,715.29$ 26,986.15$ 25,855.27$ 24,249.94$ 30,881.59$ 29,243.76$ 26,929.68$ 24,120.48$ 20,105.52$ 21,232.25$ 19,020.07$ 18,819.36$ 309,159.36$

VRS Supervisor Reg 78.61$ 13,835.36$ 12,420.38$ 13,033.54$ 15,564.78$ 15,132.43$ 13,638.84$ 14,424.94$ 13,835.36$ 13,835.36$ 14,424.94$ 11,319.84$ 13,167.18$ 164,632.92$

VRS Supervisor OT 93.07$ 9,400.07$ 5,072.32$ 5,519.05$ 2,978.24$ 7,561.94$ 2,699.03$ 6,235.69$ 5,398.06$ 3,397.06$ 4,932.71$ 7,538.67$ 4,541.82$ 65,274.64$

VRS Utility Reg 68.55$ 12,064.80$ 10,968.00$ 12,167.63$ 12,613.20$ 13,147.89$ 11,516.40$ 12,613.20$ 12,064.80$ 11,516.40$ 12,613.20$ 9,528.45$ 12,099.08$ 142,913.04$

VRS Utility OT 79.28$ 8,998.28$ 6,500.96$ 2,695.52$ 4,756.80$ 5,811.22$ 3,646.88$ 4,717.16$ 4,836.08$ 4,320.76$ 4,400.04$ 5,597.17$ 1,585.60$ 57,866.47$

Payment to VRS (based on SBWMA Hourly Rates) 191,596.54$ 146,485.79$ 142,356.75$ 142,990.20$ 171,687.49$ 158,298.86$ 155,669.49$ 143,437.46$ 126,010.39$ 139,581.37$ 122,238.69$ 122,646.76$ 1,762,999.78$

VRS MRF Sort Labor Paid by SBWMA 22.31$ 160,959.74 136,765.23 137,121.99 139,649.47 145,832.73 133,852.94 143,251.88 138,595.83 132,628.71 142,025.68 132,628.49 156,313.45 1,699,626.14

VRS MRF Sort Labor Reimbursed by SBWMA 3,416.40 1,971.00 1,708.20 - - 1,051.20 5,913.00 279.25 - - - - 14,339.05

Total Paid by SBWMA 164,376.14 138,736.23 138,830.19 139,649.47 145,832.73 134,904.14 149,164.88 138,875.08 132,628.71 142,025.68 132,628.49 156,313.45 1,713,965.19

Nelson Invoice 54,886.80 73,361.34 94,006.52 57,861.26 52,377.64 69,137.81 69,474.83 69,486.98 95,519.34 63,987.55 69,950.18 89,297.04 859,347.29

Neslon MRF Sort Labor Reimbursed to SBR by SBWMA 24,482.77 35,301.31 44,857.53 28,846.53 32,701.91 27,610.84 29,488.47 39,527.02 45,763.38 33,959.26 44,183.21 35,440.33 422,162.56

Net Nelson Invoice Paid by SBR 30,404.03 38,060.03 49,148.99 29,014.73 19,675.73 41,526.97 39,986.36 29,959.96 49,755.96 30,028.29 25,766.97 53,856.71 437,184.73

Total Paid by SBWMA 194,780.17 176,796.26 187,979.18 168,664.20 165,508.45 176,431.12 189,151.24 168,835.04 182,384.67 172,053.97 158,395.46 210,170.17 2,151,149.93

Total Paid by SBR 246,483.34 219,847.13 236,363.27 200,851.46 224,065.13 227,436.67 225,144.32 212,924.43 221,529.73 203,568.91 192,188.87 211,943.81 2,622,347.08

Variance 2017 to 2019 110,514.39 66,522.31 76,724.85 68,065.15 84,039.11 94,537.12 67,423.19 50,269.32 57,525.58 31,967.39 (8,060.42) 16,835.46 716,363.45

Reimbursed by SBWMA (27,899.17) (37,272.31) (46,565.73) (28,846.53) (32,701.91) (28,662.04) (35,401.47) (39,806.27) (45,763.38) (33,959.26) (44,183.21) (35,440.33) (436,501.61)

Total Variance 2017 v 2019 82,615.22 29,250.00 30,159.12 39,218.62 51,337.20 65,875.08 32,021.72 10,463.05 11,762.20 (1,991.87) (52,243.63) (18,604.87) 279,861.84

Inbound MRF Tons

CSS 3,160.50 2,835.09 2,860.17 2,861.36 2,944.03 2,751.64 2,952.53 2,829.39 2,706.16 2,959.80 2,739.91 3,053.07 34,653.65

OCC 90.45 85.83 87.84 73.21 78.40 78.17 95.75 129.67 109.77 88.46 118.09 99.36 1,135.00

REC 3,836.10 3,110.42 3,071.07 3,166.72 3,361.35 3,021.32 3,230.39 3,126.96 3,044.83 3,222.67 3,028.39 3,793.36 39,013.58

Subtotal Franchise 7,087.05 6,031.34 6,019.08 6,101.29 6,383.78 5,851.13 6,278.67 6,086.02 5,860.76 6,270.93 5,886.39 6,945.79 74,802.23

RSMC Shop Box/Member Agency 3.33 1.39 2.99 2.74 2.59 3.68 2.45 2.77 17.34 25.48 6.20 2.10 73.06

SBR Recyclables 5.93 2.85 1.98 2.47 2.08 0.95 1.05 0.87 1.06 0.94 2.44 2.00

PRC-Buyback 53.32 46.61 61.96 63.39 62.99 71.13 74.28 46.57 - - - - 480.26

PRC-Drop-Off HHW 19.72 15.37 20.95 19.31 17.48 18.49 24.49 13.82 15.79 20.97 14.11 16.29 216.79

PRC-Drop-Off Recyclables 44.61 32.83 35.21 66.30 55.14 47.03 36.98 55.40 46.57 43.25 34.24 41.00

Non-Franchise 6.66 2.68 6.02 6.47 14.67 8.22 4.10 7.70 4.35 5.38 3.86 1.25 71.36

Clean OCC 0.82 1.22 - - - - - - 2.73 1.02 0.60 -

Contracted Single Stream - - - - - - - - - - - - -

Subtotal 134.39 102.95 129.11 160.68 154.95 149.50 143.35 127.12 87.84 97.04 61.45 62.64 841.47

Total MRF Inbound 7,221.44 6,134.29 6,148.19 6,261.97 6,538.73 6,000.63 6,422.02 6,213.14 5,948.60 6,367.97 5,947.84 7,008.43 76,213.27

Total MRF Paid Tons 7,214.69 6,130.22 6,146.21 6,259.50 6,536.65 5,999.68 6,420.97 6,212.27 5,944.81 6,366.01 5,944.80 7,006.43 76,182.26

Total Inbound Processed 7,195.79 6,116.07 6,125.26 6,240.19 6,519.17 5,981.19 6,396.48 6,198.46 5,931.75 6,346.06 5,931.29 6,990.14 75,971.86

Total Tons Sold 5,673.62 3,970.09 3,976.74 4,209.12 5,825.57 5,054.50 5,017.41 5,247.71 4,651.66 5,459.98 4,596.42 5,030.85 58,713.67

MRF Residue (Tons) 1,339.77 1,143.83 1,185.65 1,119.06 1,178.91 958.33 1,060.50 977.92 1,013.99 1,078.26 1,003.23 1,154.38 13,213.83

Residue % 18.6% 18.7% 19.4% 17.9% 18.1% 16.0% 16.6% 15.8% 17.1% 17.0% 16.9% 16.5% 17.4%

Disposal Rate 42.73$ 57,248.37$ 48,875.86$ 50,662.82$ 47,817.43$ 50,374.82$ 40,949.44$ 45,315.17$ 41,786.52$ 43,327.79$ 46,074.05$ 42,868.02$ 49,326.66$ 564,626.96$ 190,351.39$

Disposal Transportation Rate 16.56$ 22,189.27$ 18,944.11$ 19,636.74$ 18,533.87$ 19,525.11$ 15,871.86$ 17,564.00$ 16,196.31$ 16,793.70$ 17,858.14$ 16,615.50$ 19,118.84$ 218,847.45$ 73,779.54$

Total Disposal 79,437.64$ 67,819.97$ 70,299.56$ 66,351.31$ 69,899.93$ 56,821.30$ 62,879.17$ 57,982.83$ 60,121.50$ 63,932.19$ 59,483.51$ 68,445.50$ 783,474.41$

Disposal Variance 55,387.52$ 26,601.95$ 24,653.02$ 27,327.09$ 25,431.52$ 15,642.42$ 20,300.99$ 5,429.37$ 18,161.73$ 12,613.78$ 10,204.15$ 22,377.39$ 264,130.93$

TPH (2017) 45

TPH (2019) 38

2017 Production Hrs 142.86 135.89 151.07 131.46 148.70 145.48 135.14 148.19 134.94 141.75 151.76 147.01 1,714.26

2019 Production Hrs 188.13 159.90 160.14 163.14 170.44 156.37 167.23 162.05 155.08 165.91 155.07 182.75 1,986.19

Variance 45.27 24.00 9.07 31.68 21.73 10.90 32.08 13.86 20.14 24.16 3.30 35.74

Equipment Operator Increase in Production Hrs 6 271.62 144.02 54.40 190.11 130.39 65.38 192.50 83.14 120.82 144.97 19.81 214.44 1,631.59

Equipment Operator Increase in Pay (as OT) 66.38$ 18,028.84$ 9,559.03$ 3,610.60$ 12,618.32$ 8,654.49$ 4,339.36$ 12,777.32$ 5,518.41$ 8,019.46$ 9,622.19$ 1,314.95$ 14,233.66$ 108,296.65$

Mechanic Increase in Production Hrs 1 45.27 24.00 9.07 31.68 21.73 10.90 32.08 13.86 20.14 24.16 3.30 35.74

Mechanic Increase in Pay (as OT) 69.35$ 3,139.26$ 1,664.46$ 628.69$ 2,197.16$ 1,506.96$ 755.59$ 2,224.84$ 960.89$ 1,396.38$ 1,675.46$ 228.97$ 2,478.43$ 18,857.08$

Total Increase in Pay (as OT) 21,168.09$ 11,223.49$ 4,239.30$ 14,815.47$ 10,161.45$ 5,094.95$ 15,002.17$ 6,479.30$ 9,415.85$ 11,297.65$ 1,543.92$ 16,712.09$ 127,153.72$




Attachment 4

Summary of Financial Impacts

South Bay Recycling

Summary of Financial Impacts to Materials Recovery Facility

National Sword Change in Law

Transport and Disposal 2017 2019

MRF Residue (Tons) 8,759 13,214 4,455 Total Tons Disposed w/o National Sword would be Sold

T & D per Ton

Disposal Transportation 16.56$ 73,780$ Net Increase in Disposal Transportation

Disposal 42.73$ 190,351$ Net Increase in Disposal

Total Transport and Disposal 264,131$

Labor Costs

Third-Party MRF Sort Labor 279,862$ Net Increase in Third-Party Sort Labor Expense

SBR MRF Labor 127,154$ Net Increase in SBR Labor Expense

Total Labor 407,016$ Total Additional Labor Expense due to National Sword

Operating Costs

Power 55,536.86$ Power Exp to Run Extra Hrs

Fuel 6,285.04$ Fuel Exp to Run Extra Hrs

Other O & M 19,666.45$ 10% of the Other Ops & Maintenance to Run Extra Hrs

Total Cost per Ton 81,488.35$ Direct Op Exp per Ton During Additional Operating Hrs

11,427 Tons Sorted in 2019 During Additional Operating Hrs

Total Operating Cost 81,488$ Direct Op Exp per Ton During Additional Operating Hrs

Transport and Disposal 264,131$ Additional Disposal Expense

Labor Costs 407,016$ Additional Labor Expense

Operating Costs 81,488$ Additional Operating Expense

Rev Share Loss Impact 887,108$ Lost Income that Offsets Operating Expense

Total 1,639,743$




Attachment 5

SBR Operating Expense

South Bay Recycling

Operations Expense

2019 Rate % Allocation Adjusted Rate

Power 4.86$ 100% 4.86$

Fuel 0.55$ 100% 0.55$

Other O&M 17.21$ 10% 1.72$

Total 7.13$

Tons 76,182

15% OT 11,427




Documents

FINANCE COMMITTEE MEETING...A. Discussion on adding a Special Finance Committee Meeting on June 9. th. at 12N. 4. Consent Calendar. Consent Calendar item(s) are considered to be routine