METROPOLITAN UTILITIES DISTRICT Committee Meetings board docs... · 2002. 1. 17. · Chairman Frost called the Committee Meetings to order at 8:15 a.m. On a roll call vote, the following

METROPOLITAN UTILITIES DISTRICT Committee Meetings

8:15 a.m. February 1, 2017

AGENDA

1. Roll Call 2. Open Meetings Act Notice

Construction and Operations – Friend, Frost, Cavanaugh

1. Capital Expenditures [Ron Reisner, SVP & Chief Operations Officer] – Tab 5 2. Amendment #2 – Gas Production PLC Replacement and SCADA Upgrade [Ron

Reisner, SVP & Chief Operations Officer] - Tab 6 3. Bids on Materials and Contracts [Jon Zellars, Director - Purchasing] – Tab 7

Services and Extensions – Howard, Frost, McGowan 1. Main Extensions [Ron Reisner, SVP & Chief Operations Officer] - Tab 9

Insurance and Pensions – McGowan, Howard, Frost 1. Recommendation for Insurance Brokerage Services Provider [Deb Schneider, SVP &

Chief Financial Officer] – Tab 10 2. 2016 Retirement Plan and Other Post-Employment Benefits Investment Review [Deb

Schneider, SVP & Chief Financial Officer] – Tab 15

Judicial and Legislative – Dowd, Friend, Howard 1. 2017 First Legislative Report [Rick Kubat, Governmental Relations Attorney] – Tab 11

Personnel – Friend, Howard, Cavanaugh 1. Promotions and Ratifications [Patrick Tripp, VP - Human Resources] - Tab 12 2. SPA Salary Structure Adjustment [Patrick Tripp, VP - Human Resources] - Tab 13

METROPOLITAN UTILITIES DISTRICT

Regular Meeting 9:00 a.m. February 1, 2017

AGENDA

1. Roll Call 2. Open Meetings Act Notice 3. Pledge of Allegiance 4. Approval of Minutes – Committee Meetings & Regular Board Meeting for

January 4, 2017

CONSTRUCTION & OPERATIONS

5. 6. 7. 8.

Capital Expenditures Amendment #2 – Gas Production PLC Replacement and SCADA Upgrade Bids on Materials and Contracts Notice of Purchases Between $25,000 & $50,000

SERVICES &

EXTENSIONS 9.

Main Extensions

INSURANCE &

PENSIONS 10. Recommendation for Insurance Brokerage Services Provider

JUDICIAL &

LEGISLATIVE 11. 2017 First Legislative Report

PERSONNEL 12. Promotions and Ratifications

13. SPA Salary Structure Adjustment

BOARD 14. Other Matters of District Business for Discussion

Roll Call


Minutes of Committee Meetings

January 4, 2017

Chairman Frost called the Committee Meetings to order at 8:15 a.m. On a roll call vote, the following members were present:

Tom Dowd Jack Frost

Mike McGowan Gwen Howard Tim Cavanaugh

Jim Begley Scott Keep, Secretary and President

Also present were various members of the staff, representatives from IBEW #1521 and other members of the public.

Mr. Friend was absent.

Open Meetings Act Notice Chairman Frost advised those in attendance that a copy of the Open Meetings

Act was posted in the rear of the Board Room.

Introduction of New Board Member Chairman Frost welcomed new Board Member, Mike McGowan.

Construction and Operations - Friend. Dowd, Cavanaugh Mr. Reisner reviewed the proposed capital expenditures, as outlined in his letter

to the Committee dated December 22, 2016.

Mr. Stanley presented additional information about the capital expenditures pertaining to information technology. Included among the discussion items were (a) procurement and implementation of SAP Open Text Document Presentment, a multiphase process that will include the ability to redesign invoices in-house; (b) maintenance upkeep for aging technology equipment; and (c) technological enhancements that will "cache" District mapping for its devices, thereby ensuring continuous connectivity of the District's Geographical Information System (GIS), irrespective of weather issues or other causes of temporary power interruptions. Mr. Stanley noted that the District will be exploring the option of leasing technology hardware beginning in 2018 as an alternative to the costly maintenance and replacement of outdated hardware.

Committee Meetings & Regular Board Meeting January 4, 2017

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Mr. Reisner reviewed his letter to the Committee dated December 20, 2016, regarding the acceptance of contracts and payment of final estimates.

Mr. Zellars reviewed the bids on materials and contracts as outlined in his letter to the Committee dated December 22, 2016.

Services and Extensions - Howard. Cavanaugh. Patterson Mr. DeBoer reviewed his letter to the Committee dated December 20, 2016,

which seeks approval for the District to enter into a Memorandum of Understanding to provide water service for a data center tentatively planned for Sarpy County.

Personnel - Friend. Patterson. Begley Mr. Tripp reviewed his letter to the Committee dated December 22, 2016,

regarding District employee promotions and new hire ratifications.

Chairman Frost asked if anyone in the audience had any comments. Mr. John Traudt presented a proposal regarding "on-bill repayment programs" {OBR). The Board thanked him for his suggestion.

The Committee meeting adjourned at 8:50 a.m.

SLK/mjm

du<Y~~ Scott L. Keep, , Secretary and President


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Minutes of Regular Board Meeting

January 4, 2017

The Board of Directors of the Metropolitan Utilities District of Omaha met in the Board Room of the Headquarters Building at 1723 Harney Street in regular session at 9:00 a.m. on January 4, 2017.

Advance notice of the meeting was posted on the first floor of the Headquarters Building from December 7, 2016 to January 4, 2017. Notice of the meeting was published in the Omaha World-Herald on Sunday, December 25, 2016. The agenda of the meeting was available for public inspection at the office of the Secretary and President and delivered to Board Members on December 27, 2016. The agenda and accompanying board documents were posted on the M.U.D. website on December 28, 2016.

AGENDA N0.1 ROLL CALL

Chairman Frost called the meeting to order at 9:00 a.m. On a roll call vote, the following members were present:

Tom Dowd Jack Frost

Mike McGowan Gwen Howard Tim Cavanaugh

Jim Begley Scott Keep, Secretary and President

Also present were various members of the staff, representatives from IBEW #1521, and other members of the public.

Mr. Friend was absent.

AGENDA NO. 2 OPEN MEETINGS ACT NOTICE

Chairman Frost advised those in attendance that a copy of the Open Meetings Act was posted in the rear of the Board Room.

AGENDA NO. 3 PLEDGE OF ALLEGIANCE

Chairman Frost invited those who wished to participate, to stand and recite the Pledge of Allegiance.


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AGENDA NO. 4 APPROVAL OF MINUTES FOR COMMITTEE MEETINGS. PUBLIC HEARING AND REGULAR BOARD MEETING FOR DECEMBER 7. 2016

Mr. Begley moved to approve the Minutes for the Committee Meetings, Public Hearing and Regular Board Meeting for December 7, 2016, which was seconded by Mr. McGowan and carried on a roll call vote.

Voting Yes: Dowd, Frost, McGowan, Howard, Cavanaugh, Begley Voting No: None

MINUTES FILE DOCUMENT NO. 137557

AGENDA NO. 5 ELECTION OF CHAIRPERSON AND ELECTION OF VICE CHAIRPERSON

Mr. Dowd moved to nominate Mr. Begley for the position of Board Chairperson, which was seconded by Mr. Cavanaugh and carried on a roll call vote.

Voting Yes: Dowd, Frost, McGowan, Howard, Cavanaugh Voting No: None Abstain: Begley


Mr. Begley thanked Mr. Frost and presented him with a plaque recognizing the past year of service as Chairperson, and another plaque marking Mr. Frost's 30-year anniversary of having served on the Board.

Mr. Begley took his seat as the newly elected Chairperson.

Mr. Dowd moved to nominate Mr. Friend for the position of Vice Chairperson, which was seconded by Mr. Frost and carried on a roll call vote.



AGENDA NO. 6 CAPITAL EXPENDITURES

Mr. Cavanaugh moved to approve the capital expenditures as outlined in Mr. Reisner's letter to the Committee dated December 22, 2016, which was seconded by Ms. Howard and carried on a roll call vote.




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AGENDA NO. 7 ACCEPTANCE OF CONTRACTS AND PAYMENT OF FINAL ESTIMATES

Mr. Cavanaugh moved for approval of the Acceptance of Contracts and Payment of Final Estimates as outlined in Mr. Reisner's letter to the Committee dated December 20, 2016. The motion was seconded by Mr. Dowd and carried on a roll call vote.



AGENDA NO. 8 BIDS ON MATERIALS AND CONTRACTS

Mr. Cavanaugh moved for approval of Management's recommendations with regard to bids for materials and contracts, as described in Mr. Zellars' letter to the Committee dated December 22, 2016. The motion was seconded by Mr. Frost and carried on a roll call vote.



AGENDA NO. 9 PROJECT RAVEN - MEMORANDUM OF UNDERSTANDING

Ms. Howard moved to authorize the District to enter into a Memorandum of Understanding with a data center developer to provide water service at scheduled phases of the development, as outlined in Mr. DeBoer's letter dated December 20, 2016. The motion was seconded by Mr. Frost and carried on a roll call vote.



AGENDA NO. 10 PROMOTIONAL INCREASES AND RATIFICATIONS

Mr. Begley moved to approve the promotional increases and ratifications as outlined in Mr. Tripp's letter to the Committee dated December 22, 2016, which was seconded by Ms. Howard and carried on a roll call vote.




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AGENDA NO. 11 APPOINTMENT OF COMMITTEES

Mr. Begley announced that a copy of the committee assignments has been distributed to Board Members, noted that no vote was necessary and asked if any member had comments to share. There were none.

AGENDA NO. 12 OTHER MATTERS OF DISTRICT BUSINESS

Mr. Begley asked whether any Board Members had any further comments they would like to offer. There were none. He then asked whether any member of the public had any comments for the Board. There were none.

Mr. Keep requested that Mr. Stanley be permitted to provide additional information to the Board about a recent upgrade in the District's payment processing system. Mr. Stanley reported that the recent modification was part of a multi-phase project aimed at having the District become fully "PCI compliant." This compliance effort was prompted by the Payment Card Industry (PCI) security standards aimed at ensuring a secure environment for customer information for any company that accepts, processes, stores or transmits credit card information. Mr. Stanley noted there were some minor issues but overall the payment process change was well-received. Mr. Keep noted the significance of the compliance from a regulatory standpoint, and stated that the District is now well-positioned to introduce a 'recurring payments' option in response to customer demand.

At 9:19 a.m., Mr. Cavanaugh moved to adjourn the regular Board Meeting, which was seconded by Mr. Frost and carried on a roll call vote.


The meeting was adjourned.

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METROPOLITAN UTILITIES DISTRICT lnter-Depal1ment Communication

January 20, 2017

Subject: CAPITAL EXPENDITURES

To: Committee on Construction and Operations cc: all Board Members, Keep, Bucher, Doyle, Schneider and all Vice

Presidents

From: Ron K. Reisner, Senior Vice President, Chief Operations Officer

The following items will be on the February 1, 2017 Committee Agenda for consideration and the February 1, 2017 Board Agenda for approval:

INFRASTRUCTURE REPLACEMENT - ANNUAL AUTHORIZATIONS

1. 10009200XXXX and 10006600.XXXX - $12,307,000 - 2017 annual authorization for gas infrastructure replacement (IR). These mains will be replaced as part of the District's Infrastructure Replacement Program. This is an initial request for an annual blanket authorization for various projects throughout the District's gas distribution system to replace approximately 15 miles of high-pressure and low-pressure cast iron (Cl) gas mains by District Construction crews. The scope of individual projects may range from several hundred feet to several miles, depending on circumstances. Individual projects will continue to be authorized by Management before work commences. Approximately 1,255 residential and 86 commercial gas services will be replaced and connected to the new gas mains at an estimated cost of $4,000,000. The annual authorization for gas service replacements was approved at the January 4, 2017 Board Meeting.

With approval of this annual authorization, the Board will be provided with regular periodic updates on the individual projects processed.

2. 10009300XXXX, 10006500XXXX and 10009500XXXX .. $10,287,000 - 2017 annual authorization for water infrastructure replacement (IR). These mains will be replaced as part of the District's Infrastructure Replacement Program. This is an initial request for an annual blanket authorization for various projects throughout the District's water distribution system. The Board approved a prior request of $4,301,000 for approximately 2.4 miles of replacement water main work and 300 associated water service reconnections at the January 2017 Board Meeting. This request is for the remaining 8.6 miles of IR work and associated water service reconnections anticipated for the remainder of 2017. Of the 11 miles of water IR work slated for 2017, approximately six miles is planned for construction by District crews with the remainder being completed by outside contractors. The scope of individual projects may range from several hundred feet to a mile or more. Individual projects will continue to be authorized by Management before work commences.

With approval of this annual authorization, the Board will be provided with regular periodic updates on the individual projects processed.

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SYSTEM IMPROVEMENT AND MAINTENANCE

1. 100072000845 - $1,500,000 - Inspect approximately 6,500 sewer laterals for possible cross bores. A cross bore occurs when a gas or water pipe is installed using a trenchless installation method and that pipe inadvertently penetrates or damages a sanitary sewer lateral. A cross bore can be potentially hazardous in the event that mechanical cleaning equipment is used to clean the sewer lateral, damages a gas pipe inside of the lateral and causes a harmful release of natural gas into a home. These sewer inspections will be performed on legacy gas projects and take place through February of 2018. The inspections will be completed by two plumbing companies which will insert small cameras into sewer laterals and televise each lateral between a house's foundation and the sanitary sewer main located in the street. The inspections will discover any cross bores or sewer damage that may have resulted from the District's construction work in the area.

2. 100052001743 and 100066002145 - $90,000 - Replace a 16-inch gas valve, 27th and Martha Streets. The existing geared plug valve is leaking and needs to be replaced. A new 16-inch ball valve will be installed outside of paving for better and safer access.

3. 100072000841, 100052001747 and 100066002104 - $57,400 -Abandon two gas regulator stations, 37th Street and Dewey Avenue and 3ath Avenue and Jones Street and uprate gas mains and services in the area from 10-psig to 45-psig. The 37th and Dewey regulator station has deteriorated and needs to be replaced. This station is one of two that serve the area. Rather than replace this station, the area will be uprated from 10-psig to 45-psig and allow for the abandonment of both stations. Abandoning both stations and uprating the gas system will increase the capacity of the distribution system, improve reliability and reduce maintenance costs associated with the regulator stations. There will be 18 commercial gas services replaced at an estimated cost of $90,000.

4. 100071000675 - $270,000 - Contracted hydrant painting. Water Distribution attempts to repaint 3,000 to 4,000 hydrants every year, with about half being painted by a contractor. Approval of this request will allow funding for a contractor to sandblast, prime and paint approximately 2, 175 hydrants in 2017.

BUILDINGS. PLANTS AND EQUIPMENT

1. 100083001043 - $466,000 -Abandon and replace Platte West wells PW91-03 and PW91-30. The existing wells were recently determined by the Nebraska Health and Human Services (NHHS) to be under the influence of surface water. These 1991 series wells were constructed prior to the final potable groundwater well design standards being finalized and accepted by NHHS. Abandonment and construction of replacement wells is recommended as it will allow Platte West to continue operating as a groundwater plant. In accordance with NHHS regulations, the District must discontinue use of the wells no later than January 12, 2018. Also in accordance with Nebraska Department of Natural Resources regulations, replacement wells for municipal wells must be constructed within one year of abandonment in order to be considered replacement wells. This project is budgeted for $180,000 in 2017 with the remainder being extended into 2018. The timeline for this project is to secure engineering services in early 2017 and develop plans and

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specifications for NHHS review by midyear. Construction is expected to begin in late 2017 and extend into the first half of 2018.

Approved:

@'~ ~ ?5~ Scott L. Keep President

Ro K. Reisner Senior Vice President, Chief Operations Officer (402) 504-7110

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METROPOLITAN UTILITIES DISTRICT Inter-Department Communication

January 9, 2017

Subject: AMENDMENT #2 – GAS PRODUCTION PLC REPLACEMENT AND SCADA UPGRADE; HUFFMAN ENGINEERING, INC.; 100084001122

To: Committee on Construction & Operations

cc: All Board Members and Messrs. Keep, Bucher, Doyle, Reisner, Mrs. Schneider, and All Vice Presidents

From: Jim Knight, Vice President, Gas Operations

On March 2, 2016, the District entered into an agreement with Huffman Engineering, Inc. for professional services for the replacement of Gas Production programmable logic controllers (PLCs) and to upgrade the Gas Production supervisory control and data acquisition (SCADA) systems to District standards. The original not to exceed amount of the agreement was $644,293.96. One subsequent individual amendment was approved totaling $1,144.90. This letter is to request an amendment to the existing contract. Additional services are requested to resolve existing programming inconsistencies, including alarms, screen graphics and connectivity, and issues discovered during the start up and checkout of the existing PLCs and SCADA system. The work included in the agreement was for hardware and software replacement and did not include resolving existing unknown configuration issues. Amendment #2 being requested for a total amount of $30,088.40 will increase the not to exceed contract amount to $675,527.26. It is recommended that the President be authorized to execute Amendment #2 to the agreement with Huffman Engineering, Inc. This matter will be on the agenda of the February 1, 2017 Committee and Board meeting for discussion and approval. James J. Knight Vice President, Gas Operations 402-504-7771 Approved: Ron K. Reisner Ronald E. Bucher Scott L. Keep Sr. Vice President, Chief Operations Officer Sr. Vice President, General Counsel President

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January 20, 2017

Subject: BIDS ON MATERIALS AND CONTRACTS DURING THE MONTH OF JANUARY

To: Construction & Operations Committee cc: All Board Members, Keep, Bucher, Doyle, Reisner, Schneider, and all Vice

Presidents

From: Jon A. Zellars, Director, Purchasing

The following items will be on the February 1, 2017 Committee Agenda for consideration and the February 1, 2017 Board Agenda for approval. The recommended bid is balded and listed first.

WATER/GAS MAIN CONTRACTS

Item

Install Water Mains in Sorensen Place, 60th St. & Sorensen Parkway 100055001193 WP 1470 Engineering Estimate: $104,455.00

Bids Sent I Rec'd

20/2

Bidder Amount Bid

Kersten Construction $145,465.00 Cedar Construction 149,980.00

(A C&A in the amount of $210,924.00 will be presented to the Board on February 1, 2017 for approval.)

Install Water Mains in The Villas of Piney Creek, 202"d St. & Biondo Parkway 100055001188 WP 1485 Engineering Estimate: $107,328.00

20/3 Thompson Construction $99,940.00 Cedar Construction 104,514.50 Kersten Construction 105,054.00


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Item Two (2) 30" MJ Resilient Wedge Gate Valves (13-766-30) 100051000987 WP 1318

OTHER

Bids Sent I Rec'd

7/5 Bidder

Mueller Omaha Winwater HD Supply Clow Valve Co. Kennedy Valve

Amount Bid $42,634.86

45,183.17 45,260.00 47,306.00 47,310.00

(C&A for 100051000987 approved July 6, 2016 in the amount of $1,924,803.00)

Item Sandblast and Paint 2, 175 Fire Hydrants Extension #4 ($115/hydt.) 100071000675

ANNUAL

Bids Sent I Rec'd

1/1 Bidder Amount Bid

Buss Lincoln Painting $250, 125.00


Ductile Iron Single Rubber Gasket Push Joint, Mechanical Joint and Restrained Join Water Pipe with Pipe Lube & Polyethylene Wrap Extension #1 (April 1, 2017 to March 31, 2018)

Perform Sanitary Sewer Lateral Pre-Inspections and Post-Inspections Using Lateral Launching Equipment in the City of Omaha and the Surrounding Areas Extension #2 (April 1, 2017 to March 31, 2018)

1/1 U.S. Pipe & Foundry $915,336.38

1/1 Backlund Plumbing $91,925.00

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Perform Legacy Sanitary Sewer 1/1 Backlund Plumbing $481,666.00 Inspection for Cross Bores Caused By Past Natural Gas Pipe Installations In the City of Omaha and the Surrounding Areas Extension #4 100072000845 GP 1557 (March 1, 2017 to February 28, 2018) (A C&A in the amount of $1,500,000.00 will be presented to the Board on February 1, 2017 for approval.)

Approved:

Debra A. Schneider Senior Vice President, CFO

e/Jtr~ %-'7! Scott L. Keep President

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January 20, 2017

Subject: NOTICE OF PURCHASES BETWEEN $25,000 - $50,000

To: All Board Members cc: Keep, Bucher, Doyle, Reisner, Schneider and all Vice Presidents

From: Jon A. Zellars, Director, Purchasing

During the month of January the following item was purchased or contracted for and is being submitted to the Board to be placed on file. The purchase or contract was initiated with the low bidder which is balded and listed first.

Item Bids Sent

I Rec'd Bidder

One (1) Super Cab, 4x4, 13/4 Baxter Ford Ford F-550 Chassis & Cab* Atchley Ford 100088000721 Boyer Ford

Amount Bid

*Additional purchase from July 14, 2016 bids Midway Ford Truck

$46,600.00 47,354.00 47,835.40 48,208.00

(C&A 100088000721 approved January 4, 2017 in the amount of $65,000.00.)

Jon ~. Zellar" Director, Purchasing (402) 504-7253

Approved:

Q,(d~ l/:~se~;;a;art

Vice President, Accounting

~~_...":A'"'-£LU"----..... Debra A. Sc neider Senior Vice President, CFO

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/~·~~ Scott L. Keep President

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1.

2.


January 18, 2017

Subject: MAIN EXTENSIONS

To: Services and Extensions Committee cc: All Board Members, Keep, Bucher, Doyle, Schneider and all Vice Presidents

From: Ron K. Reisner, Senior Vice President, Chief Operations Officer

The following main extensions will be on the February 1, 2017 Committee Agenda for consideration and the February 1, 2017 Board Agenda for approval:

WATER

Job Number Project Cost Applicant Construction M.U.D. Cost Contribution by Aoolicant

100055001193 $210,924.00 $212,431.80 $0 $0

This main is being installed to provide domestic water service and fire protection to five commercial lots in Sorensen Plaza Rep/at 1 Subdivision at 6dh and Sorensen Parkway. There are connection charges due for the existing 8-inch water main in Sorensen Parkway and 24-inch water main in 6dh Street in the amount of $1,507.80. (City of Omaha zoning, Sixty Sorensen, LLC)

Job Number Project Cost Applicant Construction M.U.D. Cost Contribution by Applicant

100055001188 $159,904.00 $192,863.00 $0 $0

This main is being installed to provide domestic water service and fire protection to 51 newly platted single-residence lots in The Villas of Piney Creek and The Villas of Piney Creek Rep/at 1 at 202"" Street and Biondo Parkway. There is a pioneer main fee for the 30-inch water main in 192"d and Pacific Streets for $32, 959. (City of Omaha zoning, Real Growth, LLC)

Approved:

E'J&-x %~ Scott L. Keep President

·~ Senior Vice President, Chief Operations Officer (402) 504-7110

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January 25, 2017

Subject: RECOMMENDATION FOR INSURANCE BROKERAGE SERVICES PROVIDER

To: Insurance and Pensions Committee cc: All Board Members; Keep, Bucher, Doyle, Reisner and all Vice Presidents

From: Debra A. Schneider, Senior Vice President, Chief Financial Officer

The District has long relied on two different insurance brokerage firms to administer its third party insurance program. While this approach allowed two different providers to serve the District, Management believes it has hindered the ability of either brokerage firm to provide a comprehensive assessment and recommendation of the most efficient and effective manner to manage risk on our behalf. Consequently, the Management Pension Committee, with concurrence of the Insurance and Pensions Committee of the Board, conducted a Request for Proposal (RFP) for Insurance Brokerage Services to identify a single provider for this service. The RFP was distributed during the fourth quarter of 2016 to the following seven firms:

1. Aon Risk Solutions 2. Arthur J. Gallagher & Co. 3. Consortio Group 4. Harry A. Koch Co. 5. Hays Companies 6. Holmes Murphy 7. Lockton Companies

All but the Consortio Group submitted a formal response to the RFP. The Management Pension Committee reviewed and judged all submissions according to the following criteria:

• Previous background and experience relevant to this RFP.

• Previous background and experience of the proposed team to be assigned to the engagement.

• Total cost to the District for basic marketing and insurance administrative services.

• Technical content of the proposal and how well the stated needs are addressed.

• Adequacy and completeness of the proposal with regard to the information specified within the RFP.

Subsequent to this review, the group of respondents was narrowed to the following four firms, who were invited to present to members of the Management Pension Committee:

1. Aon Risk Solutions 2. Harry A. Koch Company 3. Hays Companies 4. Lockton Companies

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All firms did an outstanding job of highlighting their capabilities to serve the needs of the District. Following deliberation, the Management Pension Committee recommends that Aon Risk Solutions be engaged to be the sole provider of insurance brokerage services on behalf of the District. In the interest of transparency, the services will be provided on a fee basis, rather than on a commission basis as was true in the past. The proposed "Year 1" fee of $57,500 results in savings of approximately $18,950 from the commission-based compensation of the most recent insurance renewal. Management is recommending that the Board grant Scott Keep the authority to enter into a multi-year agreement (three to five year term) wi on Risk Solutions to be our sole insurance brokerage firm.

Debra A. Schneider Senior Vice President, Chief Financial Officer

Approved:

g'dfr ~ %f Scott L. Keep . President

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METROPOLITAN UTILITIES DISTRICT lnter-Deparlment Communication

January 24, 2017

Subject: 2016 RETIREMENT PLAN AND OPEB INVESTMENT REVIEW

To:

From:

Insurance and Pension Committee cc: Board Members; Messrs. Bucher, Doyle, Keep and Reisner and Vice

Presidents

Debra A. Schneider, Senior Vice President, Chief Financial Officer

Attached is a report from Vanguard Institutional Advisory Services (VIAS) which is a review of the District's 2016 Retirement Plan and Other Post Employment Benefits (OPES) Investment Performances. VIAS started providing investment advisory services for the District's Retirement Plan in January 2015 and OPEB in 2016. This item will be on the February 1, 2017 Committee Meeting agenda for discussion and review purposes only. Sterling Gabbitas, VIAS Senior Investment Consultant, will be in attendance to give a brief presentation to the Board on the 2016 investment performance and to answer any questions.

Approved:

()/~. /{~ 'f{o; L. Keep President

Enclosure

Debra A. Schneider Senior Vice President, Chief Financial Officer (402) 504-7128

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Info Purposes


January 24, 2017

Subject: FIRST LEGISLATIVE REPORT -2017 SESSION

To: Judiciary and Legislative Committee

cc: All Board Members; Keep, Doyle, Bucher, Schneider, Reisner; all Vice Presidents; Nowka

From: Rick Kubat, Government Relations Attorney

The Legislature convened on January 4, 2017, to begin the 90-day long session and is tentatively set to adjourn on June 2, 2017. The body consists of 17 new senators, and Committee Chairs were elected for two-year terms. Governor Ricketts has indicated his desire to manage the roughly $900 million biennium budget deficit with no tax increases, reduced spending, and maintaining the State Cash Reserve Fund with a $500 million balance. Please find below a listing of legislative bills for Board consideration along with management's recommendations. In addition to the list of legislative proposals, there are numerous other bills that will be monitored on behalf of the District.

LB 30 (Kolterman) - Proposes to require Omaha and Lincoln police and firefighter new hires are enrolled in cash balance plans. The effective date of when LB 30 would apply to new hires has yet to be determined.

Mgmt. Rec: Neutral Status: Retirement Systems Committee Hearing February 7, 2017

LB 127 (Groene) - Requires each public body to publish a public meeting notice in a newspaper of general circulation in each county of the public body's jurisdiction. The body could also use additional methods of public notice. The public body would also be required to record the methods and dates of the public notice in the minutes.

Mgmt. Rec: Neutral Status: Referred to Government, Military and Veterans Affairs Committee

LB 218 (Groene) - Places restrictions on the use of land and water used for augmentation projects to meet interstate compact compliance. LB 218 was introduced in response to the Nebraska Cooperative Republican Platte Enhancement Project (NCORPE). In 2012, four Natural Resource Districts joined to procure roughly 19,000 acres in Lincoln County to retire irrigated lands for a ground water augmentation project to provide water to tributaries of the Platte and Republican Rivers in order to comply with interstate compacts. LB 218 requires several additional public notice requirements for the NCORPE project or for future similar augmentation projects. The bill is specific

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to augmentation projects for compact compliance. As currently drafted, LB 218 does not affect ground water pumping by municipal water suppliers.

Mgmt. Rec: Neutral Status: Referred to Natural Resources Committee

LB 305 (Crawford) - Creates the Paid Family Medical Leave Act for all employees in Nebraska to be operated by the Nebraska Department of Labor. Employees would be entitled to take up to 12 weeks of paid family medical leave for their own health or the birth or adoption of a child and up to six weeks of leave for the care of a family member. The program would start in 2020, and qualifying employees would be required to pay into the program at a cost of no more than $2.00 per week. The program is funded by a payroll tax of up to one-half of one percent of employee wages as determined by the Commissioner of Labor. Claims for paid leave would be processed by the Commissioner of Labor. All other benefits due to the employee would accrue during the leave if the benefits are allowed to accrue for any other type of leave granted by the employer.

Mgmt. Rec: Neutral Status: Referred to Business and Labor Committee

LB 313 (Briese) - Increases Nebraska's current 5.5% state sales tax rate to 6.5% in order to provide additional dollars for property tax relief. LB 313 proposes to adjust specific earned income tax credits. The District's opposition to LB 313 is specific to the increased sales tax rate, which would be applied to some District material and input costs and the collective gas and water bill.

Mgmt. Rec: Oppose Status: Referred to Revenue Committee

LB 365 (Blood) - Proposes to change what a public body can charge for public record requests from non-residents. Allows public bodies to charge non-residents for the existing salary or pay obligations to the public officers or employees, including a charge for the services of an attorney to review the requested public records.

Mgmt. Rec: Support Status: Referred to Government, Military and Veterans Affairs Committee

LB 410 (Smith)- Changes the Public Service Commission from five to seven members with staggered elections. The Governor would be allowed to initially appoint the two new additional Public Service Commissioners for their first term and then Public Service Commissioners become subject to district elections.

Mgmt. Rec: Neutral Status: Referred to Transportation and Telecommunications Committee

LB 459 (Smith) - LB 459 allows the One-Call Board to determine best practices for the marking, location, and notification of proposed excavations which shall govern the OneCall Center, excavators, and operators of underground facilities. Any rule adopted or promulgated by the One-Call Board would need to be subsequently approved by the State Fire Marshal. LB 459 further provides the authority for the State Fire Marshall to both provide for operating procedures and technology for the One-Call Center and provide for the qualifications. appointment. retention and composition of the One-Call Board of Directors.

Mgmt. Rec: Support Status: Referred to Transportation and Telecommunications Committee

LB 494 (Briese) - Broadens the public records exception to permit the withholding of public records, which could pose a threat to public safety or the security of critical energy infrastructure.

Mgmt. Rec: Support Status: Referred to Government, Military and Veterans Affairs Committee

LB 503 (Brewer) - Prohibits public employers from deducting union dues or assessments, except as required by an existing collective bargaining agreement. Future collective bargaining agreements could not contain a provision permitting public employers from deducting union dues or assessments.

Mgmt. Rec: Neutral Status: Referred to Business and Labor Committee

LB 510 (Ebke) - Prohibits political subdivisions from having installment contracts for purchases of real or personal properties which collectively exceed $25 million.

Mgmt. Rec: Neutral Status: Referred to Government, Military and Veterans Affairs Committee

LB 660 (Wayne) - Permits private energy providers to market and sell electricity in Nebraska. LB 660 shifts rate setting authority from public power boards to the Public Service Commission (PSC). The PSC would establish criteria for retail electric rates in Nebraska. Additionally, public power would be prohibited from exercising eminent domain to acquire private electrical provider's facilities and properties.

Mgmt. Rec: Oppose Status: Referred to Natural Resources Committee

LB 664 (Kuehn) - Prohibits political subdivisions from using any tax or fee imposed by a government body to employ or contract with a lobbyist.

Mgmt. Rec: Oppose Status: Referred to Government, Military and Veterans Affairs Committee

LR 4 (Blood) - Requests an interim study by the Natural Resources Committee in order to determine whether the state should conduct a comprehensive water quality study. The resolution desires consideration of nitrate-nitrogen and other toxins in waterways. The study is to address the water quality concerns as a result of nitrates from fertilizers, septic systems, animal waste, and other nitrogen-bearing minerals in the soil.

Mgmt. Rec: Support Status: Referred to Executive Board

Approved:

.(' vv~-.vcc~i~~

Richard A. Kubat Government Relations Attorney 402-504-7125

Ronald E. Bucher, Senior Vice President/General Counsel 402-504-7238

~~p.~es~~ 402-504-7106

METROPOLITAN UTILITIES DISTRICT lnter-Deparlment Communication

January 20, 2017

Subject: Promotion Increases and Ratifications, February 2017 Board meeting

To: Personnel Committee members Friend, Cavanaugh, and Howard cc: Board Members Begley, Dowd, Frost, and McGowan; President Keep, and Sr.

Vice Presidents Bucher, Doyle, Reisner and Schneider

From: Patrick L. Tripp, Vice President, Human Resources

The Human Resources Department is recommending that the Board of Directors approve the wages/salaries set out below. All positions involve District employees earning more than $10,000 per year and therefore require your approval.

1. Bargaining Unit/OAC - Promotion Wage Increases

The Human Resources Department is recommending that the Board of Directors approve wage increases for the following Employees within the Bargaining UniUOAC classification. These wage recommendations are based on a formal selection process, are in compliance with the collective bargaining agreement, and are made following the posting and application process for a job opening in the District. The effective date for these increases will be the beginning of the next OAC pay period following Board approval.

Employee: Robert Nielsen Current position (department): Utility Worker (Construction) New position (department): Crew Leader (Construction) Current rate; step/grade: $33.95; Step 4 Proposed rate; step/grade: $35.83; Step 3 Percent of increase: 5.54% District hire date: April 17, 2000

2. Bargaining Unit/OAC Promotion Wage Increases Due To Job Progression

The Human Resources Department is recommending that the Board of Directors approve the following wage increases for the Bargaining UniUOAC employees who have successfully completed required training and who have been recommended by their supervisor for promotion as they progress within their job family. All increases are based on the bargaining unit wage structure. The effective date for these increases will be the beginning of the next OAC pay period following board approval.

Employee: Aaron Mays Current position (department): Apprentice Mechanic (Transportation) New position (department): Mechanic (Transportation) Current rate; step/grade: $26.84; Step 4 Proposed rate; step/grade: $28.51; Step 1 Percent of increase: 6.22% District hire date: June 30, 2014

E0121328

Approved

Promotion Increases and Ratifications, January 2017 Board meeting Page 2

3. Supervisory, Professional and Administrative - Increases

The following Supervisory, Professional and Administrative (SPA) employees have been promoted. It is recommended the President be authorized to increase the salary of these employees. These SPA positions have been evaluated, graded, appropriate job descriptions completed, and posting guidelines fulfilled. The effective date for these salaries will be the beginning of the next SPA pay period following board approval.

Employee: Jeremy Bach Current position (department): Communications Clerk II (Customer Services) New position (department): Supervisor, Dispatch Office (Customer Services) Current rate; step/grade: $31.57; Step 4 Proposed rate; step/grade: $70, 137; SPA 4 Percent of increase: 6.81 % District hire date: September 7, 2010

Employee: Vincent Juarez Current position (department): Group Leader (Construction) New position (department): Construction Foreman (Construction) Current rate; step/grade: $39.60; Step 4 Proposed rate; step/grade: $86,487; SPA 4 Percent of increase: 5.00% District hire date: October 18, 1993

4. Supervisory, Professional and Administrative - New Hire Ratification

Board of Director Ratification of salaries, for new SPA employees hired from outside the District, is required to confirm the salary within the grade established for the position. Authorization to ratify the annual salary of SPA employees hired from outside the District will be requested each month, if appropriate.

There are no recommendations for approval this month.

'1>ate apptO;ed

Date approved

Patrick L. Tripp > Vice President, Human Resources (402) 504-7882


January 20, 2017

Subject: SPA SALARY STRUCTURE ADJUSTMENT

To: Personnel Committee, Dave Friend, Chairperson, Tim Cavanaugh, and Gwen Howard cc: All Board Members, Keep, Bucher, Doyle, Schneider, and Reisner

From: Patrick L. Tripp, Vice President, Human Resources

As a matter of policy, the Salary Structure for SPA employees is reviewed by the District's management on an annual basis. Following the review a recommendation for an adjustment is made to the Board. Any adjustment authorized by the Board becomes effective on March 1, 2017.

The District historically has compiled surveys and other relevant data prior to making a recommendation. For 2017, the primary focus continues to be SPA Benefit Changes and the SPA/Bargaining Unit Comparison. Compensation surveys were also reviewed.

SPA/Bargaining Unit Comparison The District has maintained and monitored an index which compares the cumulative effect of increases over the years as they apply to the Bargaining Unit wage system (OAC employees) and the Salaried, Professional, and Administrative (SPA employees) wage structure. This index is maintained in an effort to assure that some equity remains between the two groups. The SPA salary structure has increased less than the OAC structure over the years since the index was established in 1983. In other words, general increases for OAC employees have been more than those granted to SPA employees on a ten year cumulative basis. (See Attachment: 2017 OAC-SPA General Increase Review)

A review of the last ten (10) years reflects a cumulative percent difference of 5.23% in favor of the OAC group. The SPA group continues to lag in this parity comparison. General Increases are not part of any wage or salary determination for any particular position. The General Increase is an annual across-the-board increase for OAC employees per the contract, and is an increase determined annually for the SPA employees through Board action. Please note that the 5.23% disparity in cumulative wages already reflects an assumed 3.5% increase for SPA employees in 2017. Also, note that OAC employees will receive a 3.5% increase for 2017 as part of their Bargaining Unit Agreement.

Compression issues between management personnel and subordinates have not been addressed by the SPA recommended increase, but this issue would be aggravated should the increase not reflect the same percentage as set out in the Bargaining Unit Agreement for OAC employees.

Recent SPA Benefit Changes • SPA employees have had increases to health plan contributions, health plan out-of-pocket costs

(i.e. deductibles, co-insurance & co-pays), and pension contributions in parallel to the OAC employee group since January 1, 2014. In addition, effective January 1, 2014 the SPA benefits for Sick Pay (days with 100% pay) and Supplemental Sick Leave (% of pay) were both reduced.

• A change in Supplemental Sick Leave (SSL) benefits was made effective January 7, 2016 resulting in a reduced benefit for SPA employees. The change in benefit requires SPA employee's to use their own sick/vacation hours (or unpaid time if sick/vacation is exhausted) during the elimination period for the SSL benefit (40 hours) rather than receiving full pay during this period. This change mirrors the current elimination period time coding for the OAC employee group.

E0121328

Approved

SPA Salary Structure Adjustment January 20, 2017 Page2

Other Data Each year, the District reviews salary data made available by outside consulting services and professional organizations. The data is consistent with what has been published in recent years. As part of this year's survey the District collected the following increase data for 2017:

• World at Work 2016-2017 Salary Budget Survey: Projected median salary increase for 2017 3.0%

• Mercer's 2016/2017 U.S. Compensation Planning Survey: Projected salary increase budgeted for 2017 2.9%

• Hay Group 2017 Planned Salary Budget Increase: 3.0% Average for salaried employees

• Society of Human Resource Management (SHRM): 3.1% Projected 2017 average salary exempt salary increase

Published Survey Data Average 3.0%

Recommendation • Increase the SPA Salary Scales minimum and maximum by 3.5% effective March 1, 2017. • Grant a maximum 3.5% general increase effective March 1, 2017 to all SPA employees, except the

President, who have demonstrated satisfactory performance; per the following guidelines:

The 2016 SPA appraisals will be reviewed, and SPA General Increases will be awarded, based on the aggregate appraisal score of each SPA employee, according to the 1 through 5 rating system. o An employee with an appraisal score for the prior calendar year of 3.0 to 5.0 will receive the

entire Board authorized General Increase.

o An appraisal score of 2.5 to 2.99 shall result in adjustment to 75% of the General Increase.

o An appraisal score of 2.0 to 2.49 shall result in adjustment to 50% of the General Increase.

o An appraisal score of 1.99 or lower will result in no Increase for the employee.

*See the full 2017 SPA Compensation Guidelines for more information.

• If compression issues are identified, an adjustment will be made which will maintain a 10% differential between the highest paid OAC position and the position of the SPA employee who supervises the OAC employee. This follows the current policy.

• A report will be completed in February to identify SPA employees that are eligible for a progression increase on March 1, 2017. Only these identified employees will be eligible for a progression increase on March 1. 2017. If an employee is at the maximum for their pay grade per this report and they do not qualify for the full general increase effective March 1, 2017, they will not be eligible for a progression increase in 2017. They will be eligible for a progression increase in 2018 because their annual salary will be below the new maximum salary for the grade.

• SPA employees eligible for a 2017 progression increase are subject to the following guidelines:

The 2016 SPA appraisals will be reviewed, and SPA Progression Increases will be awarded, based on the aggregate appraisal score of each SPA employee, according to the 1 through 5 rating system. Progression Increases are subject to the proration schedule for employees hired,

SPA Salary Structure Adjustment January 20, 2017 Page3

promoted or transferred in the previous year (2016). The Progression Increases are determined by the following:

o An appraisal score of 3.0 or higher shall result in the entire 5% Progression Increase or applicable prorated progression percentage if the employee was hired or changed jobs in 2016.

o An appraisal score of 2.5 to 2.99 shall result 75% of the maximum Progression Increase.

o An appraisal score of 2.00 to 2.49 shall result 50% of the maximum Progression Increase.

o An appraisal score of 1.99 or lower shall result in no annual Progression Increase for the SPA employee for the year.

•see the full 2017 SPA Compensation Guidelines for more information.

The budgeted SPA increase in annual payroll was 3.5 percent which totals $702,671 . I will discuss this proposal at the February 1, 2017 Board Meeting and will be available to answer questions at that time.

APPROVED:

~EL~ ~ 2<'~ Scott L. Keep t/ President

Attachments:

-....___..-..... ~ Patrick L. Tripp Vice President, Human Resources

2017 OAC-SPA General Increase Review-10 year history 2017 SPA Compensation Guidelines 2017 SPA Salary Scale

DATE Apr-07 Apr-08 Apr-09 Apr-10 Apr-11 Apr-12 Sep-13 Apr-14 Apr-15 Apr-16

scheduled Apr-17

DATE

Apr-07 Apr-08 Apr-09 Apr-10 Apr-11 Apr-12 Sep-13 Apr-14 Apr-15 Apr-16

scheduled Apr-17

METROPOLITAN UTILITIES DISTRICT 2017 OAC - SPA General Increase Review

10 Year History

COMPARATIVE INCREASE OAC DATE

3.00% Jun-07 4.00% Jun-08 4.00% Jun-09 3.90% Jun-10 0.00% Jun-11 0.00% Jun-12 3.50% Jan-13 3.50% Jan-14 3.50% Mar-15 3.50% Mar-16 3.50% proposed Mar-17

CUMULATIVE OAC DATE

100.00% 103.00% Jun-07 107.12% Jun-08 111.40% Jun-09 115.75% Jun-10 115.75% Jun-11 115.75% Jun-12 119.80% Jan-13 123.99% Jan-14 128.33% Mar-15 132.83% Mar-16 137.47% proposed Mar-17

10 Yr Cumulative percent difference OAC over SPA= The proposed SPA 2017 increase retains the % spread of:

SPA 3.00% 3.73% 2.85% 1.57% 0.00% 0.00% 2.00% 3.50% 3.50% 3.50% 3.50%

SPA 100.00% 103.00% 106.84% 109.89% 111.61% 111.61% 111.61% 113.84% 117.83% 121.95% 126.22% 130.64%

5.23% 5.23%

SPA Compensation Guidelines for 2017 (Appraisal Year 2016)

General Increases

All SPA employees will be eligible for the approved General Increase. The increase will be effective on the same date as a Board of Director's approved revision to the SPA salary structure. Employees may receive up to the same percentage increase as the structure increase for their assigned grade. For 2017, the effective date is March 1, 2017. This policy will be reviewed and updated for each calendar year in January of each succeeding year. General Increases for SPA employees are subject to the following:

The prior year's SPA appraisals will be reviewed, and SPA General Increases will be awarded, based on the aggregate appraisal score of each SPA employee, according to the 1 through 5 rating system.

• An employee with an appraisal score for the prior calendar year of 3.0 to 5.0 will receive the entire Board authorized General Increase.

• An appraisal score of 2.5 to 2.99 shall result in adjustment to 75% of the General Increase.

• An appraisal score of 2.0 to 2.49 shall result in adjustment to 50% of the General Increase.

• An appraisal score of 1.99 or lower will result in no Increase for the employee.

Progression Increases

Note: All progression increases are subject to the *proration schedule, if applicable, during the first year of hire, transfer, or promotion. (See the attached *Proration Schedule chart.)

Progression Increases of up to 5% can be annually granted to SPA employees who have not attained the Maximum salary of their job grade. This Includes employees who are promoted or transferred, or who are new hires still eligible to obtain Progression increases--- until the Maximum salary for the grade has been reached. The progression increase will be determined by scores achieved on the prior year's annual appraisal. Progression Increases are granted effective March 1st of each year (subject to the proration schedule). The Progression Increases are determined by the following:

• An appraisal score of 3.0 or higher shall result in the entire 5% Progression Increase or applicable prorated progression percentage if the employee was hired or changed jobs in 2016.

• An appraisal score of 2.5 to 2.99 shall result 75% of the maximum Progression Increase (75% X 5% = 3.75%).

1

• An appraisal score of 2.00 to 2.49 shall result 50% of the maximum Progression Increase (50% X 5% = 2.5%).

• An appraisal score of 1.99 or lower shall result in no annual Progression Increase for the SPA employee for the year.

Timely Appraisal Completion Requirements

All OAC and SPA appraisals must be timely completed by supervisors.

SPA employee voluntary self-evaluations will commence in December. Supervisors will commence their evaluations and preparation of appraisals in mid-December, continuing through late-January. The deadline to complete SPA appraisals by supervisors will be January 20, 2017. The deadline for 2nd level managers will be January 27, 2017.

It is expected that all SPA appraisals will be completed for the 2016 calendar year, and going forward, in compliance with the policy.

*Proration Schedule {effective March 11 201s1

(Based on month of Hire, Promotion or Transfer)

• March 12/12 = 1.oooox 5% = 5.00%

• April 11/12 = .9167 x 5% = 4.58%

• May 10/12 = .8333 x 5% =4.17%

• June 9/12 = .7500x 5% = 3.75%

• July 8/12 = .6667 x 5% = 3.33%

• August 7/12 = .5833 x 5% = 2.92%

• September 6/12 = .5000x 5% =2.50%

• October 5/12 = .4167 x 5% =2.08%

• November 4/12 = .3333 x 5% = 1.67%

• December 3/12 = .2500 x 5% = 1.25%

• January 2/12 = .1667 x 5% = .83%

• February 1/12 = .0833 x 5% = .42%

Note: Prorated progression increases, per the above guidelines and proration schedule became effective March 1, 2015. These guidelines replaced previous compensation policy for progression increases during the first year in a job.

2

j_ METROPOLITAN UTILITIES DISTRICT

SP A Salary Scale 3.5% Increase Effective March 1, 2017

Grades 2017 Minimum 2017 Maximum -

SPA - 13 $160,186 I I

$230.,266 I

-SPA - 12 $132,715 I $190,775

- -- - ~ . _,

SPA - 11 $122,175 $158,058 II - -- -

SPA - 10 $113,567 II Sl46,,928 ~

SPA - 9 $106,011 $13(j,,04~ -- ·-

SPA - 8 S98,504 $125,,901 ~-

SPA - 7 S91,324 $116,,257 •.-... -r--. - ~~ ··-·-..

SPA - 6 $84,680 SlOi ,,355 - -

SPA- 5 S78,364 II $98,,948 ·-- - - - -....... . ""." , -

SPA - 4 S72,592 S91,286 ..

SPA - 3 S67 162 .. ' II S.84,,108

-- . - , _ -SPA - 2 $62,290 $77,,679

·- ·-c -·

SPA-1 $57,863 571,,866

*District President's Salary Not Included

Documents

METROPOLITAN UTILITIES DISTRICT Committee Meetings board docs... · 2002. 1. 17. · Chairman Frost called the Committee Meetings to order at 8:15 a.m. On a roll call vote, the following