[0:37] I'm going to jump on this call.

[0:44] There you go. All right, good afternoon, pursuance to California Government Code Section 5495-3E. This meeting will be held by call conference only.

[0:53] If it's a collocation will be available for this meeting, however, members of the public will be able to participate in the meeting.

[0:58] In accordance with their requirements of Governor Cove Government Code Section 3VC reference, members of the public wishing to address the board committee and a video conference meeting.

[1:08] During public comments or any item list among the agenda should use the raise hand to a located in the meeting like listed on the agenda at the time the item is called speakers will be acknowledged by the board chair in the order of us to receive

[1:20] and granted speaking address to address the board.

[1:25] So I will now ask the clerk's office to call this meeting order.

[1:30] Thank you, Chair. Director Santos?

[1:35] Yes. Director Cronin?

[1:38] Yes.

[1:39] Chair Keegan?

[1:40] This constitutes quorum of the committee.

[1:42] Okay, time open for public comment on any item not on the agenda.

[1:46] Members of the public who is to address the committee on any item not listed on the agenda.

[1:49] Should access the raise hand to a located in Zoom meeting linked listed on the agenda.

[1:54] Speakers will be acknowledged by the committee chair and order request to receive and grant to speaking access to address the committee.

[1:59] speakers comments should be limited to three minutes or a set by the chair. The law does not

[2:04] permit committee action on or extended a session of any item not on the agenda except under

[2:08] special circumstances. If committee action is requested, the matter may be placed on a future agenda,

[2:13] all comments that require response will be referred to staff or reply and writing. The committee

[2:18] may take action on any item of business appearing on the posted agenda. Are there any members of

[2:24] public that would like to speak to us on an item not on the agenda.

[2:29] Madam chair, I see no hands raised at this time.

[2:33] Okay, thank you very much. We do not have minutes included in this package. That is correct.

[2:40] Okay, regular agenda item 4.1 election of 2022 board audit committee chair and vice chair Mr Taylor. Do you have anything to add to this?

[2:53] Okay, I'll entertain a motion.

[2:56] There's a motion by the director said to us to a point.

[3:00] Director Barbara Keegan is chair.

[3:03] I will second that motion and I will also if a friendly amendment.

[3:07] Yeah, I'm to a point director.

[3:09] Keegan is chair.

[3:12] Okay.

[3:14] So.

[3:15] Will call please.

[3:17] Director Santos.

[3:18] Yes.

[3:18] Director Creman? Yes, and Cherokee again. Yes. Do we have a motion for election of the

[3:27] vice chair?

[3:31] Okay, I will move. I think given the business of director Creman is

[3:37] chair this year, you're probably not incredibly interested in serenance vice chair, so I

[3:42] will nominate director Sances as vice chair if I can get a second on that.

[3:54] Well,

[3:54] I think he's muted himself.

[3:56] I mean, I don't mind doing it.

[3:58] Yeah, it's how to you.

[3:59] You want to be very serious? Why would be?

[4:02] Sure.

[4:03] Okay.

[4:03] All right.

[4:04] You're on busy, but, you know, the important thing.

[4:08] So, um, and you have quite a bit of longevity on this committee.

[4:13] So, um, we have the motion.

[4:16] I'll second that motion.

[4:18] Um, roll call, please.

[4:20] Director Santos? Yes.

[4:22] Director Credit?

[4:23] Yes.

[4:25] Thank you very much everyone and I do want everyone to know I did take the and I share with staff.

[4:32] People on this committee like action items and they like to move quickly so we're going to try and do our very best with that.

[5:00] Taylor, you are listed as the responsible manager that I do think that Mr. Hopper also participated in this. So I'll turn it over to you, Mr. Taylor.

[5:12] And thank you, and good afternoon, and I think I will turn over to Brian Hopper to go over the second.

[5:19] Thank you. Good afternoon to the committee. Senior Assistant District Council, Brian Hopper.

[5:24] We're here to discuss some potential changes to the audit committee charter, so there are some red line to recommend it changes, note it and the packet and the second item is to get input from the committee regarding any further proposed changes to the audit committee charter and finally to ask that you recommend approval to the Board of Directors, these modifications.

[5:52] And so I'll just begin there is added language and article eight section three and let me know if it's useful for me to share my screen on this.

[6:03] I don't maybe have your packets in front of me, but article.

[6:07] What did you go ahead and share your screen if you wouldn't mind Mr. Hopper.

[6:11] All right.

[6:24] Okay, I hope I am sharing the audit committee.

[6:28] Item.

[6:29] Is that correct?

[6:32] All right.

[6:32] So the first change is in article eight section three article eight deals with the annual financial statement audit and we're including language for requirement that the financial statement audit results and pertinent information identified during the course of the audit must be communicated to the board audit committee and let me just turn to that actual language.

[6:59] which it's an arclet

[7:07] section for the red line.

[7:10] Yes.

[7:16] Right. So it's having affirmative obligation that the financial statement audit results

[7:22] in pertinent information, be communicated in writing or verbally to the Board of

[7:27] Committee, and it defines pertinent information as issues, concerns, practices, programs,

[7:34] or activities that may pose a reputational operational financial or service delivery risk to

[7:41] valley water regardless of the magnitude of the apparent risk. And Dr. Keegan may be

[7:47] wish to add on to this, but the thinking was that this was important to have because the

[7:54] financial auditor is really retained by management.

[7:59] And this would ensure that such information is

[8:03] directly communicated to the Board Audit Committee.

[8:07] And I guess I would list your comments,

[8:08] direct to Keegan, if you had any or to our independent

[8:13] auditor, if you had any further comments on these changes.

[8:16] Well, I'll just add one comment.

[8:19] I think that this came up as a result of seeing situations

[8:23] with other public agencies where the management was informed

[8:28] of issues or deficiencies, but the elected officials

[8:33] were not. And so the intent behind this was to ensure that there would be full disclosure of this

[8:39] information through the audit committee and then subsequently as appropriate to the full board.

[8:45] So that was, I think, a big impetus behind this. And I don't know, George, if there's anything

[8:51] you would like to add in terms of the importance of this kind of clause in the audit charter.

[8:59] Yeah, I think that this kind of cause is actually quite consistent with the direction that

[9:05] audit committees are moving, that exposure to the audit committee of any potential audit findings

[9:13] is particularly related to financial audits, that the audit committee is being formed

[9:18] to those issues in a timely manner, and really to reduce the potential that significant audit

[9:27] findings are only made aware to management and not government boards.

[9:32] So this is very consistent with what we're seeing in the industry overall.

[9:37] So I think any provision that ensures the committee has insight into those potential problems.

[9:45] I think that's all the better.

[9:46] Okay, great.

[9:47] Thank you.

[9:47] Committee, Vice Chair, Creman, you've raised your hand.

[9:54] You're on mute.

[9:58] Just have a little construction work.

[10:00] So, I, you know, with respect to three, by the time you do the audit results of an annual audit, it's kind of too late because your, your months, your, you could be over a, well, you probably are a year over any issue.

[10:18] So, what I would say is, it should be, we should be, we should, number one, and certainly

[10:25] here we should have quarterly meetings with the financial auditor, to hear, as opposed

[10:31] to wait for a year, because we should have quarterly looks at the financial statements like

[10:39] we're just starting to have, number one, and then on Section 2, which says input, it should

[10:49] direction subject to the full board agreement.

[10:54] So input, what's a nonstandard here for me is input,

[11:01] because management can say, I want, of course, a manager will never do this, but theoretically, we want,

[11:06] and we want an auditor that's two people in a room, and I've actually been involved in that two people in a farmhouse,

[11:12] And it did produce out in financials, but we should be able to provide direction subject to the full board.

[11:19] So that would be my ass.

[11:22] And so it wouldn't be input to be direction subject to full board.

[11:25] And it would be quarterly meetings and pertinent information I would add.

[11:33] Repetential operational finance service delivery risk.

[11:39] I think that's pretty good.

[11:41] It should be actual apparent risk, I like that.

[11:48] I'm I'm going to want to ask the direction language to hear from district council, but before we move forward with this, the way I read the third clause.

[11:59] It says financial statement, audit results and permanent information identified during the course of the audit shall be communicated.

[12:08] And in my mind that meant it was supposed to be communicated to us in real time as opposed to the end of the audit, but maybe it's not clear here that that's actually what's being requested.

[12:21] So do you have anything more explicit, Mr. Kremlin that you would like to see?

[12:25] So I think we'd have to ask Mr. Taylor.

[12:29] I'm used to auditors that come in and review financials quarterly.

[12:35] They don't audit them, but they'll give it a review level quality.

[12:40] You know, no footnotes, just kind of like what we're getting now.

[12:45] And they look at those.

[12:47] And then they would give us any issues, concerns, practices, programs, etc.

[12:53] by the time the audit is, that's, that's so far in the since any event that occurred, it's not, it's not as useful.

[13:04] So what what you're saying is that this, this information would be, it would be like when they come to us quarterly, we expect this closure at that time.

[13:13] Is that your intent?

[13:14] That's right. And it should say they come to us quarterly. I don't see that in here.

[13:19] Okay, okay, yeah, and they come to present that score really and if there's any issues, and I'd like to ask the board auditor what has been on your experience,isters,

[13:32] styles like how are other agencies typically dealing with this, not that we have to follow necessarily with their duties, but just know what the normal practices.

[13:43] The typical practice would be that the auditors, whether it's external or internal, so forth, would have a direct line of communication anytime.

[13:53] Any time they believe there was anything that the board should be made aware of or the committee should be made aware of.

[14:02] But it certainly, and I think that's what three is getting to is any time an issue is raised in their mind that they think the committee needs to be made aware of, they're obligated to come to the committee and address that, but the implementation of quarterly meetings is, I think, is less common in the public sector.

[14:26] But it's also consistent with the trend of audit committees receiving more direct input from both internal

[14:37] auditors and external auditors on matters related to audits.

[15:00] Regarding potential audit findings and managing risks, more in a real time and being informed of potential

[15:08] risk, more in a real time basis rather than waiting a year later. So it is less common to have

[15:16] quarterly meetings in the public sector from my experience. But I do think it is certainly consistent

[15:22] with the moving direction that we're seeing in terms of audit committees and as an auditor that does

[15:29] This kind of work performance on it work, not financial, I know I would welcome those kinds of meetings to meet with the board and brief the board on issues and have the board ask direct questions about what it is that we're saying so for so that's

[15:45] That's what that's what I'm seeing in my experience.

[15:47] Okay, so we've had a couple of things I've identified here, I think that themes are it's okay and there's an interest in having

[15:58] the financial auditor come to the audit committee quarterly and even go to the board if that

[16:06] steam necessary. But rather the language perhaps during the course of the audit should be something

[16:15] in terms of if pertinent information is identified by the financial auditor shall be communicated

[16:20] it because we shouldn't wait until the quarter is up. I mean, if something has happened, they're

[16:25] actually. Yeah. Okay. So that's what we're interested in doing. That's one thing. And I think

[16:30] we can massage that. And then the other is this issue about input or direction. But before we

[16:37] go any further, I would like to ask Director Santos. If he has any comments that he would like

[16:43] to add Director Santos? Well, Chair Cigna, when you open the video, you said, you know, this committee

[16:48] wants more action and so on. So there it is. And I think that's really good because it keeps things fresh and not

[16:55] stale and I think like would Gary say that we don't want to wait a year. We want to keep up as stuff in

[17:01] me and then we may have to share stuff with the board sooner. So this is a good input.

[17:07] Okay, good. Um, I think I would like at this point now to turn to district council Oriana

[17:14] In terms of the second item, we're providing direction to value water management on the selection criteria, subject to board approval, whether you're thoughts on that.

[17:32] I think mechanically, I think the idea is certainly valid that the automatically should have a direct role in communicating and helping to advise staff and management on how to address these issues.

[17:49] Mechanically, I think it could be difficult to do that in real time if the committee were to have it then go back to the board for ratification of its direction.

[17:58] But I think given that the charter is approved by the board, my take is that an amendment to the charter that specifically delegated that authority from the board to the committee would accomplish that if the board were so, so to choose.

[18:13] So Vice Chair Creman, I think that actually simplifies what you were requesting. Are you okay with that?

[18:22] Yeah. Yeah, it's delegated. You know, it's not to kind of think usually most people want to weigh in on, you know,

[18:30] size and the costs. It's just, it's not like the art.

[18:38] Through the chair, if I may offer a suggestion, perhaps to make it cleaner, and so that

[18:45] there's going to be about five, ten years from now, perhaps you can have the language

[18:49] say that the board specifically delegates that authority.

[18:52] Absolutely.

[18:53] Yeah.

[18:54] I think we would need to incorporate that in the Board of Charter, correct?

[18:58] Yeah.

[19:00] Because they would approve that.

[19:01] Right.

[19:02] Okay.

[19:03] So, we had one other item, which is the education component.

[19:14] Well, we had one other item there, Chair.

[19:17] Sorry to interrupt.

[19:18] Okay.

[19:19] We should just set the date.

[19:21] It should probably just be, you know,

[19:23] because I know we're out the bid right now.

[19:25] Correct, Mr. Taylor.

[19:29] We're in the process of developing the RFP for new financial orders.

[19:33] Okay, so it sounds like we have a little time on this, right?

[19:38] Okay.

[19:40] A little time.

[19:41] A little very little.

[20:00] We suggest is that I work with Mr. Taylor and Mr. Hoffer to modify the language here consistent with what we

[20:08] heard from the committee members and then have it go directly to the board and that would be one more

[20:13] opportunity for the committee members. That way we're not delaying it, bringing it back here, you know, we want to move forward in real time. Mr. Hoffer, do you think that's appropriate?

[20:24] Yeah, I think that's fine. If the committee wishes to delegate that authority to you, then we can work with you and then get the matter to the full board.

[20:34] Right, and we'll do that in consistent with what we've heard from the committee members today.

[20:40] The next one education is pretty simple.

[20:45] We wanted to provide a little more flexibility with the training,

[20:49] So that it doesn't, it can happen every year, but it doesn't necessarily, we'll put it on a two-year cycle because it can be difficult to try and get that training to the place.

[21:00] Is everyone okay? Are the community members okay with that approach?

[21:12] Director Santas?

[21:13] Yes, I'm good. Okay, and vice chair Creman. Yes, I'm so. All right, so let's see what we have here.

[21:24] And if I may Madam Chair, I think the other item was to even list any additional suggestions from the committee regarding proposed changes to the charter.

[21:36] So are there any other things in the charter that committee members would like to see modified or and this could be a long-term thing that we could take a look at over time, but at least this way it will have staff thinking about whether there's anything further we'd like to see.

[22:01] I'm not seeing anything at this time. Maybe we'll just, this is something we can revisit over time,

[22:08] and so that may be an opportunity for the committee members as time makes forward and

[22:14] and there may be new issues that come up that we can talk further. But I think these items

[22:21] we're talking about right now, well, especially the first one about the financial audit or our time

[22:25] sensitive, so we want to bring these changes to the full board as quickly as possible.

[22:29] Are my committee members in agreement on that?

[22:32] Yeah, Chair Kiggen also, and we have our evaluation a lot of times, you know, that sometimes brings up issues that we think about them, so yes, I agree.

[22:41] Okay, good point.

[22:43] And I see a nod from Vice Chair Kremlin.

[22:45] Okay, so the recommendation was to consider recommended changes.

[22:49] We've done that provide input regarding further changes.

[22:53] We're deferring that.

[22:54] and approve recommendation Board of Directors for modifications to Board Audit Committee Charter.

[23:01] So I'd like to entertain a motion that recommends that I work with staff to finalize the

[23:09] modifications to Board Audit Committee Charter so that it can move forward to the Board for approval.

[23:14] I think that's a second. Okay. Thank you. Real call please.

[23:20] Director Santos? Yes. Director Creman? Yes.

[23:25] Chair Keegan? Yes.

[23:27] Most of the houses. Great.

[23:28] I know 4.3. The subject is receiving update on the status of the Chaco Res War Expansion Backpinding Investigation.

[23:35] And the recommendation is to receive an update on the status of the Chaco Res War Expansion Backpinding Investigation.

[23:40] and be a proof direction to staff to provide results

[23:44] for the fact finding to the report of directors.

[23:47] And I think Mr. Hopper is here item.

[23:51] Yes, it is.

[23:52] Again, senior assistant district council Brian Hopper.

[23:55] We're here on the update on the status

[23:57] of the Pacheco Reservoir expansion,

[23:59] effect finding investigation.

[24:02] And you will recall that there was direction

[24:04] from the board and then the committee

[24:06] to look into cost increases to that project.

[24:12] And percent of that direction, we retained a attorney-sepita Rufigar from the law firm, Jackson Lewis, to conduct the fact finding.

[24:21] As noted in the memo, she has completed that work.

[24:26] There is attached to the memo, an executive summary of her findings, of her work and her findings.

[24:33] And Mr. Rufigar is present at the meeting today, and we stand ready for her to answer any questions the committee may have regarding those efforts or if the committee would like she can make a brief presentation regarding the fact finding and her findings.

[24:51] It's the pleasure of the committee members.

[24:53] I don't need it. I read the report and I'd like to thank.

[24:57] I'm cooperating with the investigation.

[25:00] The report, I don't think we need to go into it. I don't even issue with it.

[25:04] No, I think that some of the things we discussed about quarterly and those kind of things would enter and many of these things that wouldn't happen.

[25:11] And when we have a lot of example, rumors or different things, that's why it escalates.

[25:16] And I think what we're doing now would simplify those things.

[25:19] And we would have more information and it wouldn't take so long. So yeah, I agree with you.

[25:25] Okay, so we're supposed to approve direction to staff to provide results to the back finding to the full board of directors.

[25:33] I don't think this requires a motion, doesn't it's your offer just to consensus with a committee?

[25:37] It consensus is fine.

[25:39] Okay, I agree with my colleagues.

[25:42] So the consensus is for staff to provide the results of the back finding to the full board of directors.

[25:47] Thank you everyone, and thank you to the attorney for being present today.

[25:52] Thank you, Mr. Fedor.

[25:54] Okay, item 4.4, receive an update on the status of the district council audit recommendation implementation.

[26:03] Mr. Orianna, will you be taking this forward?

[26:06] Yes, check you. Thank you. Good afternoon to the committee. We have provided an update on the action items that came out of the audit of the district council's office back in 2019 2020.

[26:16] You'll note that we've made a good progress on most of the items and we're on track to close

[26:21] them out. Hopefully this year certainly stand open for questions on the updates.

[26:27] I do want to point out that this obviously only relates to the audit of the district council's office.

[26:31] I was completely back in 2020. It does not relate to any of the other items that may touch on the district

[26:35] council's office work that might be identified in the community's work plan.

[26:41] Okay, do we have any, I think district council laid it out pretty well, you know, there were issues that came up during the tenure of a prior district council.

[26:58] And now Mr. Orianna has been in the job. I didn't realize it was quite as long as it is, so it's more than half a year.

[27:06] So we've seen the progress report, I don't know whether there's any additional interest or any questions that we might have.

[27:22] Vice Chair Cremon, anything you'd like to ask?

[27:26] No, not at this time. I was satisfied.

[27:29] Director Santas?

[27:30] No, I would just imagine that another six months that Carlos would have many things that he has found out or reviewed that may have happened in the past may have some suggestions for the future.

[27:43] There's different styles, different management and some of those things can all be put out later on.

[27:49] Okay, and once again, I don't see any members of the public that want to weigh in on this.

[27:55] I'd like to thank District Council and his office for showing us the actions that they've taken and I think these are all good things and we look forward to seeing positive outcomes from it.

[28:13] So thank you again, District Council.

[28:16] Thank you as well.

[28:17] and let's see, so we've received an update that was all we needed to do in that.

[28:21] Okay, 4.5 status update on the implementation of recommendations from the 2015

[28:27] Consultants Contract Management process audit, conducted by Navigant Consulting and status update

[28:33] on the Consultant Contracts Improvement Process, and the recommendation is to

[28:39] receive a status update on the implementation of the recommendations made by Navigant

[28:43] In the 2015 consultant contracts management process audit and the status of the consultant contracts improvement process.

[28:50] And I just wanted to highlight for the board.

[28:55] This is actually an audit that was done on the management side of the organization.

[29:03] But the emphasis behind it was that the board had been made aware that there were some noncompliance events back in 2014.

[29:11] So, the audit was commissioned, and I know that staff had been a long time, by virtue of the fact of the complexity and the need for certain process improvements including technology updates.

[29:28] So, Miss Yoke, I know that you will be presenting or you'll be introducing this if not presenting it.

[29:34] So, we'll turn it over to you at this time. Thank you.

[29:36] Thank you very much, Chair Keegan, and good afternoon, Board Chair Creman and Dr. Santos.

[29:43] And both of the other water attendees and any members of the public, they're also on attendance.

[29:47] One to turn this over to concepts and Gayoteen, our unit manager for procurement and contrast to give the presentation.

[29:54] And my E.A. Janet is going to be advancing with our points slides.

[30:15] Next slide please. So today we're here to give you an update on what's happening with the 2015 Navigant Audits on the Consultant Contracts Management Process. Next slide please.

[30:35] We're here to just give you a summary of what the audit was about, some key findings, some accomplishments, and key performance data that we've tracked over the years. Next slide please.

[30:51] We reported, this is the third time of reporting and reported back in 2018 and back in 2021 and now back again for the most recent updates.

[31:07] Next slide, please.

[31:09] So, the audit findings were that we needed to develop clear and consistent policies and procedures.

[31:19] We're in the process of completing this through a development, the procurement manual and updating of policies.

[31:29] When I've arrived at Valleywater, I'm finding that all the policies practically are old and neat updating.

[31:39] We have been found, it was a finding that we needed to define roles, responsibilities, and target timelines.

[31:48] And we've accomplished actually five of those deliverables.

[31:53] We were able to define roles and responsibilities for contracts staff, as well as the program management staff.

[32:01] We improve boiler plates for consistent contract development, scope, and deliverables as well as established timelines.

[32:11] And along with those boiler plates, we continuously update them and standardize them, not only within the consultant contracts section of procurement, but also in the purchasing and the construction construction contracts side of the house.

[32:31] We also track performance and measured against the new milestones and finally we utilize a procurement plan check this to confirm those roles and responsibilities.

[32:48] We also develop some clear pre and post award processes including insurance compliance and with this particular finding we ended up

[32:59] changing our compliance vendor from

[33:04] exeges to e-bix and found e-bix a little bit more easier to work with and

[33:12] we're finding that we're able to track our compliance better but in the future

[33:17] what we want to do is track that compliance and you know and our goal is to reach

[33:26] You know, 95% compliance on anything, on any insurance that need renewals.

[33:34] Yes, question.

[33:36] Yes, go ahead.

[33:38] Can you tell us a little bit about e-bix?

[33:41] Yes, so e-bix is a third party insurance compliance provider.

[33:49] What they do is once we determine from the risk management,

[33:54] what those insurance requirements are, we submit them to e-bix and then along with them,

[34:04] we submit a copy of the endorsements as well as the certificate's e-bix.

[34:11] So the initial review of the insurance search can actually be conducted by e-bix,

[34:18] But we conduct those in-house and then once those are all approved, we upload them into e-bix and then year after year as the contract progresses e-bix continues to monitor that compliance.

[35:00] But also to the project manager, as well as to procurement. And from there, we just wanted to make sure that those insurance requirements are met. And if not, then we contact that vendor so that we can get assurance of those coverage.

[35:21] Thank you for that explanation.

[35:23] How does it tie in?

[35:25] Because we have a policy.

[35:27] Everything has no siloed info.

[35:29] Where is it tie into our, you know, our ERP or CRM, et cetera?

[35:38] So yeah, and it's not, it's not tied in whatsoever.

[35:43] We find that, for instance, we have a procurement portal.

[35:47] that is new for us, called Planet Bids, they do have an insurance module, but that insurance

[35:54] module only tracks the time in the cancellations, right? But if this not actually reviewed the

[36:01] insurance documents themselves for the requirements, it takes third-party providers such as this

[36:07] to be able to review that for compliance. And that's the reason why we're going with a third-party

[36:14] provider.

[36:15] The COC is there anything you'd like to add to at this time?

[36:20] It provides some expanded detailed information.

[36:22] Our bid documents, you know, as conception only indicated, you know, indicates a level of coverage,

[36:28] whether it's workers' com, general liability, you know, any types of bonds, requirements, and

[36:33] this offers intended to not only assist with that initial review, but ensure that those certificates

[36:38] of insurance are active at all time.

[36:40] If a vendor has a cancellation, if renewals coming up, that, you know, we have a mechanism

[36:49] that, you know, as an agency, we are not left with with exposure risk of, again,

[36:57] a having a project site without the vendor having the appropriate coverage.

[37:01] So this is what that software is intended to perform. And we're looking to integrate with

[37:08] a plan of bids module, which is, you know, the contracting module.

[37:13] So just, Vice Chair Cremon, just to give some of my personal experience, I've worked for three

[37:19] public agencies, and this insurance issue has been a significant problem at every agency.

[37:27] Because if they all come in due at different times, they can get

[37:33] cancels at any time. It's not always clear who owns it, does the project manage your own

[37:42] it, does procurement own it, does legal own it. And so it's really an ongoing problem. I mean,

[37:50] this does to me seem like a very good step forward. But I think your underlying concern was

[37:58] How accessible is this information to all parties within the district and my correct that that's your concern?

[38:06] Well, it's part of that.

[38:07] I'm just first of all, I think it's a policy violation.

[38:09] We're supposed to keep our we can't use software that doesn't tie in other software.

[38:15] Let me give an example of why it's relevant to this specific.

[38:18] Someone changes their address someplace, you'd have to change it in e-bex, and change it in the rest of our ERP system, unless there's APIs that tie in.

[38:28] I'm not saying it's not fixing an underlying problem, but there's 50, I'm looking at it right now online. There's many people who have coverage genius, Scotia, that have APIs.

[38:42] So you don't have this issue that it doesn't tie in the finance, you can't do projections based on when things that are expiring.

[38:51] So I'm not saying it's not solving an underlying problem.

[38:54] I just don't understand how this got passed IT.

[38:59] We're supposed to be for we use software to be sure things integrate in any way and I see none of that here.

[39:07] So we're bringing a lot of it. I think this is something we need to really look at if this is the right way to do it.

[39:14] So do we have anyone from IT to respond to the issues by Stewart Crim and Brett?

[39:21] So so I am here. I might cut that be a mis sort of off-surf.

[39:25] So I think we're probably missing a point of clarity here.

[39:28] Is that the ERP system is the system that is storing the final versions of the contracts and the insurance information, all that sort of stuff when the contract is executed.

[39:38] So we're talking about an address change in our contacted trade, it's changing something like that.

[40:00] I don't consider a separate software system that is the repository that holds all the insurance information, but rather I look at them as a third party that yes holds a copy of that information, but they're continually monitoring for any changes that we might need to them load into the ERP system.

[40:18] So if you've done it because it's not mentioned when I read the materials in immigration plan.

[40:27] So the integrations right now, so there's another parallel project going on.

[40:32] So it can set you mentioned the plan.

[40:34] It's software that's running our bid processes and contracts.

[40:38] That's actually going to be the integration point is the integration point into into info.

[40:44] So there's an integration there.

[40:45] point I did just sitting in the middle.

[40:50] Oh, there is. Yes. I don't want to bore people with this, but tell me more.

[40:59] Go ahead, Mr. Cook. Yes. So yeah, effectively, this point as much as we can on a

[41:05] make has been automated, but between the systems at this

[41:10] point. That's a, is much as you can, I mean, you know,

[41:19] The system in my stapler is integrated to my phone as much as I can, I mean, what does that mean?

[41:28] So, the e-bix, the e-bix offer is more just to be software, it's a team where they are monitoring these documents for people's insurance and

[41:39] operations and changes and all those sorts of things. So there is a manual element of it that the EBEX company is doing for us.

[41:48] So they're they're doing manual entry on their side. They have to notify us that they see anything that's actionable that we might need to go approach a vendor about on our side.

[41:58] So there's manual pieces back and forth there and we have to communicate back and forth with the vendors.

[42:02] But in terms of the documents exchanging back and forth between the system and the ERP system,

[42:09] all those pieces are automated and the ERP is the home for all of that information.

[42:12] It's just documents. There's their medical information being transferred back and forth.

[42:19] Yeah, yes, yes. Yeah. So why do I say documents? Yeah, so it's a whole document management system.

[42:24] So each document has its own metadata that's in our ERP. That's in our ERP. Correct.

[42:32] Okay, I will leave the fact that we're outsourcing work to someone else and we just found out about it right now in real time to another day.

[42:43] Okay, why don't we go on with the presentation.

[42:45] Well, actually, I have one question that came to my mind.

[42:48] and vice chair-crimin based on this.

[42:52] So as I mentioned, I've worked for in recent years,

[42:59] over the last 20 years, work for Valley Water,

[43:03] work for the City of Sunnydale,

[43:04] work for the City of San Jose,

[43:05] and this insurance issue was a major problem

[43:08] at all those agencies.

[43:11] The solution that we found are there other public agencies

[43:16] that are taking a similar approach to what we're doing to address this problem?

[43:22] We're currently using the state's vendor. We transition from a former solution provider

[43:28] exercises to evics and evics is utilized by the State of California's agencies.

[43:36] Okay, so we haven't been reinventing the wheel. We're in alignment with the best practices

[43:42] that other publications say. Okay, great. Thank you. I will let you go on with your presentation

[43:50] and Director Santos, please raise your hand or say something if you have any questions as well.

[43:55] So, back to you. I think in the future when we see these presentations especially with new

[44:04] software or processes, because here are processes that there's people doing stuff and software,

[44:11] It seems IT should be, you know, part of the presentation because I'm still left with some questions on, you know, is this some loose integration? Are we going to end up with more silos, more disparate copies of information? And I guess for this, I'm relatively assured, but I think that should be just as much as we put a spell check on a presentation.

[44:37] And we should check that we're doing it and we're integrating so we don't have the mess we've had in the past.

[44:46] We want to trust but verify, right?

[44:49] Well, we should have a process to decide the lines.

[44:54] Okay, I think I think staff that's heard your concerns.

[45:00] Contract Administration, Improve Technology Tools. So this is an ongoing improvement with cycle times. And then we recently implemented ERP technology called in for. So we went go live by the first of January.

[45:16] The next one establish guidelines to improve the development of the scope of work.

[45:23] We have implemented a procurement bidding software called Planet Bits.

[45:28] At this point, we are almost through with implementation.

[45:34] We have, for consulting contracts, however, they are complete with implementation.

[45:39] They are fully using Planet Bits, construction contracts.

[45:43] there are also using planet bits fully. It's now just the purchasing, the purchasing team that is

[45:52] beginning to use and implement planet bits for the solicitation processes.

[45:58] Develop process for consultant evaluation and compliance and that's in progress at this point.

[46:06] We've worked on replacing CAS as suggested by the audit finding.

[46:11] And so we've transitioned from cast to planet Bids, and again, it's their completion, only the purchasing team actually needs to complete that implementation phase.

[46:23] Next slide, please.

[46:25] May I ask the same question about integration? Can we go back to how E-Bix integrates with planet Bids, which implements with.

[46:33] Integrates within 14 to tell me a little bit about it?

[46:37] I think that that semester occurs at you.

[46:39] Actually, you know, you're, you know, our present, our presenter, okay, you work. I'd like to know how you feel and integrates in together in for and planet beds and the other system we have.

[46:53] So we've integrated planet bids with our ERP technology very smoothly, where we are holding

[47:04] our solicitation documents, process within planet bids, and once those contracts are ready

[47:13] for award, we actually just transfer those awards or contracts to our ERP, and then from

[47:21] ERP that continues on with, you know, the change order process, the financial, all those pieces.

[47:31] When it comes to e-bix, e-bix is going to integrate with planet bids in terms of just the notification

[47:39] process. Because eBix and planet Bids, planet Bids is mainly where our agency, right?

[47:49] Agency staff and buyers are connected to, but not necessarily eBix, so we need to integrate

[47:58] that information into planet Bids. And then of course, whoever is awarded the contract that moves on to

[48:07] with the ERP section of the integration.

[48:13] Does that help direct a crime in?

[48:17] I think so.

[48:18] So I heard some of the integration,

[48:20] I don't wanna bore our,

[48:22] what it could be with all these details.

[48:27] But I think we get why it's important to keep you

[48:32] in the word side of the visualization.

[48:33] But you know, as we move from paper systems and as we have a retirement process, having all the information, one copy of the information.

[48:43] I'm going to place saves money.

[48:48] And I want to be sure that we have, I mean, like, for example, Mr. Cook, were you part of the approval process for planet Bids?

[48:58] Yes, yeah, the IT team actually PM the implementation of the plan of this. What about the purchase? Yes, okay. What about events?

[49:10] That one's been a little while I don't recall for top of my head.

[49:14] Well, if I recall, we certainly assist with integrations, but if I recall the purchasing team that the selection of the software.

[49:23] I'm not saying they don't, but, you know, if by the time they get you buy and you're forced to integrate a bad integration, in a way it's kind of too late.

[49:35] So maybe it's something for us to look at what's the best practice.

[49:39] I'd like to know what our auditor thinks.

[49:41] What's the best practice?

[50:00] Do the work? Is it left with kind of a spaghetti? And inconsistent info?

[50:09] So, Mr. Skyls, do you have anything to add to the discussion?

[50:18] You're on mute.

[50:21] I haven't been on both sides of this. As a contractor, we see the process that you're describing, the use of the events we're very familiar with that we've seen over the past maybe five years.

[50:33] significant number of agencies move to an external service like this to monitor essentially

[50:45] insurance compliance. And so it's not surprising to see that. I think that the keeping

[50:55] IT in the loop on any information technology purchases is something that

[51:03] frankly, is ideal in most organizations and lacking in most organizations.

[51:09] And so I don't know in this particular case to what extent information technology was kept in the loop.

[51:16] I may have been that a decision was made quite a long time ago to outsource this particular function

[51:23] and the view was really that this event was just a replacement of an existing outsourcing

[51:29] and so that the review of the need to outsource

[51:34] so the review of how would this system integrate

[51:37] with other solutions that are currently being prepared,

[51:40] possibly that didn't occur,

[51:42] but that disconnect between information technology

[51:44] and the procurement of software solutions like E-Bix

[51:50] is common.

[51:52] I will say to you that E-Bix is a little bit different

[51:56] most IT solutions in that part of it is you're paying you outsourcing a service and not just a

[52:04] solution and so there's staff at eBix that are monitoring compliance with this and so it is a

[52:10] little bit different but yeah I can understand that that disconnect but in my view from an audit perspective

[52:18] anytime there's outsourcing of information technology including IT to understand how that information

[52:24] would be integrated is crucial because with insurance provisions in particular that's where we see

[52:30] a lot of non-compliance and contracting requirements because it falls through the craft.

[52:34] It's very easy to do. So thank you, Mr. Scott. And what you said is definitely my

[52:41] past experience that it all threw the cracks. And so I see that Miss Yoke has her hand raised. So

[52:48] if please go ahead.

[52:51] Thank you very much, Director Keegan.

[52:53] I just want to assure this committee that all procurement decisions that involve IT across the organization.

[53:00] Informer actually is programmed that if someone enters a requisition is technology-related,

[53:05] that it routes to technology.

[53:07] It routes to an IT staff member to review and approve that.

[53:13] And this was the case even pre-in for that.

[53:15] across the process improvements that was put in place, shortly after I got here, we're

[53:25] seeing sure that we have the ability to have this collaboration, right, a conversation

[53:30] and we've got to IT procurement. So we're not letting you just any one purchase software.

[53:40] I guess my question is there's one thing routing at the IT but being part, you know, you don't want to, you know, to go to Rector Santos and my is coming about, you know, have a bias towards action, you don't want it to be a bottle neck, but if they're that part of the decision making as opposed to it's a faded complete and it just lands on their desk a couple brochures.

[54:07] This is what we're buying, yeah, I don't know.

[54:13] I don't need to best practice this is what I'm saying.

[54:17] Yeah, but I think I've said my piece.

[54:20] OK, well, actually that was why I asked the question

[54:23] whether other people were using e-vicks.

[54:25] And I think we've heard both from George and Tina.

[54:33] It is something that's commonly used.

[54:37] So maybe this is something where

[54:38] can get a report back in the future, especially as for moving forward with implementation, because

[55:01] So, would you like to see this come back to the committee by short comments?

[55:05] And although it's not about who is using it? It's the system that we built our backbone, our ERP.

[55:13] There might be a hundred people using it, and there's still an SAP world.

[55:18] So, that's not really relevant. It's installed basis. It's integration with what we've decided to do here. Does that make sense?

[55:27] Yeah, so that's my question.

[55:29] Okay, so that is that something that we can get a report back as we're implementing the rest of these things.

[55:36] Thank you, because I think this is an important discussion, and I appreciate the points that by sure are coming up.

[55:42] So, and thank you, Monsieur, for being willing to bring it back.

[55:45] And now we'll go back to Concepcion because she's still trying to get through this presentation.

[55:50] So, Ms. Skyton, please go ahead.

[55:52] Thank you. So I've mentioned all these accomplishments and improvements through the key findings, but I wanted to point out the last item here, which is the procurement advisory committee.

[56:04] We've established a committee where it's a way it's a way to communicate between procurement and the rest of the agency and actually it's by way of the unit managers.

[56:17] It's well received and so far each time we've had a meeting, we've had great attendance.

[56:23] I think in a mention, like over 75 each time or more. But in any case, this is a way for us to collaborate, right?

[56:32] Especially with info and planet bits and all these changes coming through procurement.

[56:37] We wanted to be able to communicate that to the departments and then have, for us to receive feedback

[56:46] on what they think about some of those changes,

[56:49] because some of the changes may make sense, right?

[56:52] Right away, but it may not make sense

[56:55] you're particular unit.

[56:56] So we wanted to hear that,

[56:58] wanted to figure it out,

[56:59] and try to figure out how to make it work for everybody.

[57:04] So anyway, it's a way for us to communicate better.

[57:07] Next slide, please.

[57:10] So here we've been tracking the numbers and the amount of volume

[57:17] work for the consultant contract side. From 2018, 2019, 2021, and as you can see, it's been

[57:29] more or less stable around the same numbers. But in actuality, the amount of work that goes in

[57:37] there is tremendous. Next slide, please.

[57:42] And then on top of that, we have amendments that we need

[57:46] take care of, not only does it vary in types, but also in value. Next slide, please.

[58:00] So, in summary, our current average processing times when it comes to contracts under over 225,000

[58:10] is three months contracts between 225 and a million about five to six months contracts over a

[58:21] million at six to seven months. These are more or less with expected but we are continuously

[58:32] looking for ways to improve that process. How does our processing time compare to other agencies?

[58:46] So when it comes to what we call invitation to bids, which are pure bids, it's not an RFP,

[58:59] That is usually, you know, six, four to six weeks and that's a minimum time and then depending on the complexity of that timing or that project, it could increase.

[59:13] Then you have what's called RFPs and mainly all the consultant contracts solicitations fall under that, those RFPs.

[59:21] And again, declining on the complexity, but the expectation is that we should meet the timeline of a minimum of six months, and of course, increase that timeline if the projects are more complex.

[59:38] So, right now, I believe that we are within those timelines, but we could improve just a little bit more.

[59:47] I think provide some context. Our first presentation following the audit in 2018, we had pulled

[59:56] almost two years worth of contracts. And, uh,

[1:00:00] Special support, because that is a significant timeframe. And again, regardless of the contract, ballot value.

[1:00:08] And so what we're seeing here is we're consistently tracking different types of contracts.

[1:00:14] And patients don't just went over a slide very quickly, the contract amendments.

[1:00:19] Some of these amendments take the entire timeframe as a way to contract issues relating with the amendments themselves.

[1:00:29] Some are more straightforward, such as a time will make sense in, but we are constantly tracking all the fees, these performance metrics, and we're finding the ability to support the organization with a quality contract with the least time possible.

[1:00:49] So, almost all of your contracts now are less than six months and a fair amount of them are less than three months, and the only exception is the IT related contracts probably due to their complexity is taking a little longer.

[1:01:03] So, you've already seen pretty significant improvement and the log diminishing returns is going to take into effect now because you've identified and put into play those efficiency is already.

[1:01:15] To some of that, we anticipate as we fully integrate planet-bid and really benefit from,

[1:01:23] we send integration of info that we're going to have some additional room for efficiencies.

[1:01:29] We may not see the huge time, you know, contracts, reductions in times that we've seen in the

[1:01:42] recommendations to to realize the efficiencies, but we do anticipate additional efficiencies in our process and we'll be coming back to us next year.

[1:01:51] So we'd have the opportunity to review that then.

[1:01:55] Ms. Guyaton, please continue.

[1:01:57] Yes, so yes, IT related contracts do you take a little bit longer because they involve demos.

[1:02:04] They involve a whole lot more stakeholders for review and accept this or particular solutions.

[1:02:10] non-compete contracts, over 500k, they actually take, I'm sorry, under 50k, over 50k is

[1:02:23] 1 to 2 months, which is expected, single source to the 2 to 4 months, but we expect that we could

[1:02:33] be a little bit more efficient in that, time only. Here's a big difference here.

[1:02:40] Not a year ago,

[1:02:44] this is just a take four months, but now we're only taking one to one and a half months to actually

[1:02:50] to actually complete these amendments over 225k at three months and amendments under

[1:03:01] to 125K, oh I'm sorry it's backwards. So amendments take three months or four point six

[1:03:07] lights. Next slide please.

[1:03:14] So there's still some action plans and implementations that we

[1:03:19] have to follow through on. So we want to complete a procurement manual in a desktop procedure

[1:03:25] manual and we're anticipating that that would be complete by March 20, 2022 and after we've completed that, we're going to bet it through the procurement advisory committee. We're going to bet that through, you know, other stakeholders and then before we finalize that.

[1:03:44] We continue, staff training and development, we will be completing our key performance indicators and determining what those are at this point with the new technologies that we are implementing and we can report on those the next time around when we provide our update to you.

[1:04:05] And then we will continue collaboration and communication district wide through the procurement advisory committee.

[1:04:13] next slide please.

[1:04:17] So finally, we will come back to you in February 2020 green and maybe

[1:04:23] just slightly sooner to give you a report back on EX. That would be great. Thank you.

[1:04:29] Thank you. Any questions? Yes. Director Santas, I, the rest of us have had a number of questions.

[1:04:36] I haven't heard anything from you yet. Do you have any comments or questions at this time?

[1:05:00] Worked to different cities, not also Gary, because of all this background in software and those things.

[1:05:05] And I remember just having to interview with Tina here some years ago, and Gary was one of the keys, because he knew software and the key question.

[1:05:12] So I find it very fascinating.

[1:05:15] I remember in the past, there's been a lot of questions in this area called questionable by contractors, different people have met and I've questioned this on.

[1:05:25] I think Taylor's doing a pretty dug-on good job of changing things around.

[1:05:29] I haven't heard a lot of different complaints, but I'm really glad we're into it.

[1:05:33] I've learned a lot by listening, so thank you.

[1:05:37] Thank you, Director Sanctus.

[1:05:38] Are there any members of the public that have any questions at this time?

[1:05:44] I don't see any, but...

[1:05:46] No hands raised at this time.

[1:05:47] Okay, we don't have any hands raised at this time.

[1:05:51] Director Credit?

[1:05:52] I just like that, you know, these are not criticisms of anything we've adapted, I'm just trying

[1:06:00] to understand where we're going, everyone's working hard and doing a really good job.

[1:06:07] But sometimes, you know, you get so into the job, yeah, it's hard to pop up to the strategy

[1:06:13] and the tactic.

[1:06:14] You get so into the tactics of the strategies, hard to see, because you know, you're

[1:06:19] working at your job real hard, and that's why I'm asking the questions.

[1:06:22] It's always important to be strategic. No question about it, but I definitely think that we've made huge strides on this.

[1:06:29] So thank you everyone for the very spirited discussion and appreciate everyone's input.

[1:06:36] I just want to go back and make sure that we received an update. That's what we needed to do. That's what we received.

[1:06:42] and thank you, Miss Yoke and team for a very informative. Our next item is 4.6. It is the

[1:06:50] second quarter fiscal year 2021, 22 financial status update. Mr. Taylor, you're going to

[1:06:57] provide us with this update. Our financial status update is September 31, 2021.

[1:07:04] Yeah, I'll just start by saying that this is the second quarter FY22 financial status update

[1:07:09] and staff has prepared a brief presentation.

[1:07:13] Have to go through it with the committee of the committee.

[1:07:15] We'd like to hear it.

[1:07:16] What's the pleasure of the committee?

[1:07:19] Vice Chair Corman?

[1:07:20] Yeah, I'd like to hear it.

[1:07:21] OK, go ahead.

[1:07:23] OK, then I will turn it over to the budget manager

[1:07:24] and we get the end up.

[1:07:26] Thank you, I'm up to see a full Taylor.

[1:07:28] Good afternoon, Chair Fiegan.

[1:07:30] Board Chair Corman and Director Santos.

[1:07:33] I'm going to take it down a bunch of underage.

[1:07:34] And then I will be walking you through the media

[1:07:37] financial status update presentation, along with Treasure Charlene Sun.

[1:07:44] So Treasure Charlene Sun will be

[1:07:46] walking you to the first half of the presentation, covering the cash investments in the

[1:07:50] dead portfolio, and I'll cover the second half more specifically the sources and uses of funds,

[1:07:55] and also the reserve balances. So with that, I'll turn it over to Treasure Charlene Sun.

[1:08:01] Okay, next page, please. Can everyone hear me? Okay, thank you. The portfolio as of December 31st

[1:08:11] with $630 million as you can see on the left side of the screen, and this represents about

[1:08:18] a $35 million or 5% decrease compared to the prior quarter, and it's primarily due to

[1:08:26] various planned expenditures, also by revenues that we've collected during the quarter.

[1:08:32] The portfolio continues to meet the board's policy regarding investing in local things,

[1:08:39] and we currently have about 41 million or six percent of the portfolio invested in various

[1:08:45] small local dates. The aging report on the right-hand side of the screen shows that we have

[1:08:52] about 44 percent or 279 million dollars in very liquid funds with maturedies of under one year.

[1:09:00] The portfolio remains very liquid and our target is to maintain a cash balance at any given point

[1:09:07] time of about $150 million to ensure that we have sufficient liquidity to fund all obligations

[1:09:14] including any unanticipated or, you know, any surprises that we might have, so we have plenty

[1:09:21] of cash to withstand any fluctuations in the market place or our business needs.

[1:09:28] We're asking questions in the chair. What are we with? Are we current with our lines of credit? Are

[1:09:34] They still open.

[1:09:36] Are there any?

[1:09:36] Yes.

[1:09:37] We are.

[1:09:38] Yes.

[1:09:38] And I will get to that in two slides.

[1:09:40] Very soon.

[1:09:41] Isn't that part of our liquidity in a way to have lines of credit?

[1:09:44] Yes.

[1:09:45] Of course.

[1:09:46] Next slide please.

[1:09:50] So this is just a summary of our current debt portfolio.

[1:09:54] Everything is on track.

[1:09:55] We have about $71 million in debt service payments.

[1:10:00] We have a lot of issues with any of the debt that's outstanding. And in speaking of liquidity, next slide, our short term, liquidity, continues to be very, very robust.

[1:10:13] We have that $170 million line of credit that we have opened with US Bank as well as three small days. That is your open. In addition, we have the $1 150 million in commercial paper.

[1:10:25] that is also open. So we have combined the total of $320 million of short-term credit facilities that are available to us at any given pointy time.

[1:10:36] And this is a great strategy for us to have because it diversifies our risk in terms of exposure to market access.

[1:10:44] In terms of all financing plans for the year, we are going to be defeasing the water utility

[1:10:50] 2006 piece by tune of this year.

[1:10:53] The board approved this strategy in the board meeting, we're very recently in January.

[1:11:01] And with that defeasants, we will be able to terminate the very old and antiquated master senior

[1:11:08] master resolution for the water utility and we will be able to convert to the much more

[1:11:15] current and lenient parity master resolution to govern all of our water utility debt.

[1:11:21] And that's a very, it's very, very nicely lined up because we will be negotiating and drafting

[1:11:28] the WIFI alone applications that will be carried off of this parity resolution.

[1:11:34] In terms of the actual debt issuance planned, we are probably looking at around November to refund any outstanding safely water CP that we may have issued in the water utility CP or revolver that we would have issued by that time.

[1:11:54] And as I mentioned, we have been very busy putting together the application for the WIFI alone.

[1:11:59] We actually just submitted the safely water with your loan application this week.

[1:12:06] As of yesterday, we submitted the application fee to the EPA as well as upload all of the 110 attachments and the application mountains of documents for the EPA to peruse and review from which we can start drafting and negotiating the actual loan agreements.

[1:12:27] We will be turning to preparing the Pacheco application immediately.

[1:12:33] The goal is to go back to the board by fall of this year to present the WIFIA loan agreements for the board's approval.

[1:12:43] And that concludes my presentation.

[1:12:50] Vice Chair Creman.

[1:12:51] None.

[1:12:52] Thank you very much.

[1:12:55] Great.

[1:12:56] Director Santos.

[1:12:58] Nothing.

[1:12:59] Thank you.

[1:12:59] any members of the public? So there's still another half to the presentation. Oh, go ahead.

[1:13:06] Thank you very much, Chair. Take it. So in terms of revenue, like six year total revenue

[1:13:10] for the first half, we're about $187 million. Just a few things to point out, the reason why

[1:13:16] there's only a cheap 35% first of all, groundwater receipts are a two on a two month away basis.

[1:13:22] We also have the conservation measures of 15% for the drought.

[1:13:26] I'm not appropriate to ask you a question on that.

[1:13:29] Sure, go ahead.

[1:13:30] You mentioned two months.

[1:13:33] So aren't we doing a cruel book?

[1:13:36] Doesn't it matter when we receive it?

[1:13:38] Don't we accrue what we expect?

[1:13:42] Or what we've failed even if we haven't received it?

[1:13:46] I think I don't.

[1:13:47] You want to say don't they?

[1:13:48] Yeah, I can jump in.

[1:13:50] So with regard to groundwater, not all wells are metered.

[1:13:54] And so that creates some delay in terms of putting together all the information,

[1:14:02] and there's some effort and some staff work that

[1:14:05] he's going to take into a lot of their information together.

[1:14:11] And the billing does happen after the treat to water billing.

[1:14:15] Treat water billing happens very quickly shortly after the close of the month.

[1:14:19] Groundwater billing just takes more time to pull information together,

[1:14:22] even for the meters, there's just a lot more meters to pull together, and so it does take

[1:14:26] a little bit more time. What about the material meters? You know, it's not, I'm not talking

[1:14:32] about the person in San Martín who's using a half acre foot. I'm talking about the material

[1:15:01] Months, you know, that kind of information. But without having information at our fingertips, you know, we, we would just be guessing.

[1:15:12] We would have that. The reason I'm asking is I know SFPC has like these electronic meters and they know every day. So we don't know every day.

[1:15:22] We don't we don't we don't we don't every day. Yeah we we're we're our our meters are

[1:15:28] dispersed. I mean we're not a retail provider. So our meters are dispersed in rural areas or

[1:15:35] other areas and and so so we're not household that are right next to each other where it makes

[1:15:40] you know the investment in that type of technology makes makes a lot of sense. I was referring to

[1:15:46] at PUC to their retailers. So Apple's Apple's comparison, we're a wholesaler, they know because

[1:15:55] they, I forget what they have, 27 retailers and they know that every day because you want to know

[1:16:01] every day. So my question is, don't we want to know every day? They're not a groundwater provider.

[1:16:08] But okay, so you're saying how, the major because it's concentrated in San Jose,

[1:16:15] water you're seeing at San Jose, what it doesn't know, how much ground water they take every day.

[1:16:20] Well, we could pick up the phone and call them if that's what you're suggesting.

[1:16:25] I mean, but yeah, I'm just saying that that our process for meter meter reading is such that

[1:16:32] it doesn't we don't get the information in as quickly as we get the treated water information.

[1:16:38] No, that just seems for operational reasons and for other reasons, I would think not only

[1:16:46] do you not want to wait a couple months before you get it,

[1:16:53] I would think you'd want to know

[1:16:54] that on it day to day. And we just don't trust in our meter reads. Do we, I think what you're saying is

[1:16:59] we listen to what they say. Don't we have a separate meter? We do our own meter is because I

[1:17:09] they were back all device in every day.

[1:17:11] It tells you every minute, every 15 minutes,

[1:17:14] it says how much water's passed.

[1:17:15] Why don't we do that?

[1:17:17] I think we've looked into that.

[1:17:18] That's probably more of a discussion for Aaron Baker

[1:17:20] and his crew to talk about metering technology

[1:17:24] to be on my purview, but that's something

[1:17:27] we could bring back perhaps.

[1:17:28] I think he is from a revenue point of view.

[1:17:31] So when I see 35% of the budget,

[1:17:33] I think it's hard for us to know if we're on track,

[1:17:36] If on a quarter basis, if we're not doing reasonable accrual books and we have ways to forecast, I mean, we could put together a forecast and that's something that we do, but something that we are able to do, we don't have the actual quarterly information, but we could easily put together a forecast that we pretty, pretty accurate.

[1:17:58] Because when I see what it says 135 million is our budget and I see 50 million and we're not at the, we're not there for all of these. I'm like, oh my God, what if they don't pass or why don't we know? So I think that's where projections could come in and I don't mean to put words in your mouth. I'm Mr. Taylor, but I think what I'm hearing is that there are solutions that could provide more information in a real time way, but it would cost a lot.

[1:18:28] to us, to, you know what, this is that one. I guess what I guess what I'm saying is what, what,

[1:18:34] what, in Ricky is showing here is, is the actual that's but what we could do very easily without

[1:18:40] a lot of effort is show the estimated actual for the quarter or for the half year that would include

[1:18:47] the projection for that groundwater revenue because it is, it is the late on the billing, but we could

[1:18:52] easily come up with a projection because director criminals, right? We kind of know what's happening

[1:18:57] with the major retailers and we know how to estimate that.

[1:19:02] Yeah.

[1:19:04] There's no point in doing books.

[1:19:06] A cruel books mid-year, quarterly.

[1:19:09] If they're not ready to be, if they're not every view quality.

[1:19:13] You know, this isn't a counting standard.

[1:19:16] And seeing, you know, how off we are in our projections.

[1:19:21] And we're asking Director Keegan or Chair Keegan about calling every meter.

[1:19:25] there's, there's someone on the phone who could, in five calls, I'll let you get 80% of our

[1:19:30] pumpers. How many, how many major pumpers do we have? San Jose Waters 57% of our remedy, right?

[1:19:38] So we could call, you know, okay, it's, it's, today we've called them, their operations department,

[1:20:00] Or we even have arrangements in email. So I would think by the time not just mid-year, but quarterly, we'd be pretty close within a percent.

[1:20:14] I'm in agreement. We could easily do that and come up with our estimated actual on the quarterly half-year basis without issue. What Enrique showing here is just the actual that was booked for that quarter as of that day.

[1:20:29] We could make that update very easily done.

[1:20:32] It's just some, I'm not sure.

[1:20:34] Would that satisfy you by sure Herman?

[1:20:36] It would because one of our principles are accurate financial statements.

[1:20:40] And this is a accurate because we haven't.

[1:20:44] It's, you know, 35%.

[1:20:45] You would think we can't be that our staff is so good at getting our projections right.

[1:20:51] So you would think we'd be way closer than 35%.

[1:20:56] That's my only point.

[1:20:58] Okay.

[1:20:59] So I think message or see Mr. Taylor?

[1:21:02] Yes, and again, that's not a step criticism,

[1:21:05] but it could be a process improvement

[1:21:07] to just have everyone at the end of every quarter email

[1:21:11] there are estimated usage.

[1:21:14] So perhaps Mr. Taylor can follow up with the CEO

[1:21:17] in terms of what we would like to see in the future.

[1:21:21] Yeah, I think this is within the CFO's

[1:21:23] purview though to do on his own.

[1:21:26] Okay, I just didn't want to get into a position

[1:21:28] direction where we're directing staff without time.

[1:21:31] No, I'm directing staff.

[1:21:33] I'm throwing out a suggestion.

[1:21:34] But if I just actually said it's up to CFO,

[1:21:38] Taylor, what do you want to do?

[1:21:39] It was zero direction.

[1:21:41] I'm never going to write staff.

[1:21:42] Okay.

[1:21:44] All right.

[1:21:46] Is it back to you, Mr. Ganda?

[1:21:49] Yeah.

[1:21:49] Thank you.

[1:21:50] Thank you, Tartiga.

[1:21:51] And also, I'd like to point out that this is,

[1:21:54] you know, comparable to last year's first half of the

[1:21:56] 2021 based on this conversation, last year was about 37% and a 10 to the year results came in

[1:22:02] pretty favorable. I understand the point of the conversation. Thank you. So slide number seven.

[1:22:09] Slide number seven, I want to talk about the operating capital expenditures on the operating side.

[1:22:14] As you assume, we're pretty close to target. We're at 40% spent towards about $204 million.

[1:22:19] couple of funds that stand out, the safety and water fund, and that's lower due to a delay

[1:22:26] of the CP patients and also at the for all the bond issuance. And in terms of the

[1:22:32] benefit assessment funds, those expenses usually take place from the second half. And then

[1:22:37] for the service funds, IT payments, and then also risk for the risk fund insurance payments,

[1:22:43] usually take place from the second half of the fiscal year. So overall, we're doing pretty well

[1:22:47] as you all know, during the end of the year,

[1:22:52] become very, very close to target

[1:22:53] about 98% spent or so.

[1:22:56] The pro capital expenditures were $196.4 million.

[1:22:59] They're in a rock, but I'd like to go on that also.

[1:23:02] So why don't we do, if you consider doing,

[1:23:06] you know, each one budget as opposed to,

[1:23:10] because you're comparing full year FY22 adjusted budget

[1:23:14] to half your actuals, I would think you'd want.

[1:23:16] Number one, you want to compare half to half, not full to half, and number two, I heard what you said.

[1:23:23] That's interesting about the payments I do later in the year.

[1:23:26] But a cruel accounting says you should have accrued in half way through the year, even if you only bat the end.

[1:23:33] So we can easily do that too. I like to read, you know, we can slice the budget in half,

[1:23:38] we'd budget on a four-year basis. So we allocate hours by project. So we didn't slice this in half.

[1:23:44] the result would be about, you'd be almost exactly right, right, I'm trying to do the math

[1:23:50] that looks exactly, I'm good in the J. Yeah. Yes, sir. So yeah, understood, like as we budget a full

[1:23:57] year basis and we can easily cut the half and the result would be about 98% spent there. So

[1:24:03] so that would work. And there's a capital expenditures similar to what we've seen as a trend,

[1:24:09] we're a 16.4 million dollars spent and that's how we influence by the time of capital projects

[1:24:14] or the delivery of projects. Some of them are not, you know, projects usually ramp up,

[1:24:20] maybe expenditures take place during the year. If we have questions about a particular fund,

[1:24:26] we do have those details on a project by project basis, more than happy to answer that.

[1:24:30] Do we have any questions about overall that theme is, you know, projects, expenditures are

[1:24:36] ramping up or timing of projects for capital projects. We are improving as compared to

[1:24:41] to last year, we're spending 166.4,

[1:24:44] versus 109.7,

[1:24:49] any questions there?

[1:24:53] Okay, then the last slide we have

[1:24:55] are the reserved balances.

[1:24:57] So, reserved balances are affected by a few things, right?

[1:25:00] We ask the main fiscal year 22 to be $141.4 million higher than our adopted budget, which took place before the fiscal year closed last year.

[1:25:14] And just to wrap up the presentation, based on the conversation that we've had here, obviously we'll continue to monitor the performance of revenues.

[1:25:22] The only concern out there is the drought, the 15% conservation goal that we have out there, so that will affect the revenues.

[1:25:29] Open expenditures are closely target as usual and then the first half couple of expenditures are lower than budget and we'll see how it's coming at the end of the year.

[1:25:41] So we're ready for any questions.

[1:25:45] Okay, Director Sanchez, any questions?

[1:25:49] No, but I think that the input that Dr. Criminus given and Darren to solve issues and there

[1:25:57] are different ways to do that. I think it's really helpful. And I'm looking forward to listening

[1:26:02] more and more and more. This is very, very, very good. Thank you.

[1:26:07] Good. Vice Chair Crimin. Yeah, I'm not trying to suggest extra work. I'm trying to suggest,

[1:26:14] You know, maybe you spot problems a little bit earlier, um, you know, like, let's say we're not collecting as much revenue as we thought that does affect, you know, let's say we're collecting more revenue than we thought something good, and maybe we could put more money and water, or like water conservation program or something like that.

[1:26:37] Good points. Okay, any members of the public. I'm not seeing any. Okay, thank you very much staff for that presentation.

[1:26:49] Our next item is item 4.7 and this is received a final update on the status of the mitigation and monitoring compliance audit recommendation implementation.

[1:27:01] And the managers on this are Ms. Jennifer Codian and Mr. John Bourgeois. I don't know who's going to be taking the lead here.

[1:27:10] Thank you, Chair Keegan.

[1:27:11] Had Jen Codian deputy for Watershed, so when I'm and I'll take the lead in presenting our final update for the status of the mitigation and monitoring compliance audit recommendation implementation.

[1:27:22] So, most of you probably know that in 2014, we conducted a compensatory mitigation audit, it was done by Panorama environmental, and as a result of that audit, they made 15 different recommendations.

[1:27:37] 14 of those have been implemented already and the last recommendation which was recommendation

[1:27:43] to see was the last component that we needed to implement and that was to consolidate the mitigation

[1:27:52] tracking databases that we were using and to include a GIS element. We expect to fully implement

[1:27:59] this in the next couple of months and to summarize how we'll be doing that we have fully integrated

[1:28:06] are stream maintenance program database, which is how we track our regulatory compliance and monitoring

[1:28:12] within Watershed's ONM with maximum, which is our asset management software program that we

[1:28:19] utilize. And that integration happened in June of 2020. And we're currently working on enhancements

[1:28:27] to the development of the geospatial data collection capabilities through mobile maximum,

[1:28:33] which should be implemented at that, you know, we're starting actually this spring, but it will be fully implemented by the end of 2022.

[1:28:43] In addition to that, we're also developing a cloud application that will be too spatially aware, and that's for both internal and external access, and so the regulators will be able to use this system and access historical SMP data,

[1:29:00] and to perform their regulatory approvals within this cloud database.

[1:29:05] So we're really excited about that.

[1:29:07] We won't have to submit the thousand page,

[1:29:09] notice the proposed work or annual summary reports

[1:29:12] that we currently do to the regulatory agencies.

[1:29:16] This is scheduled to go live by May of this year.

[1:29:20] And the data within this cloud application

[1:29:24] will also push through to EcoAtlas platform.

[1:30:00] We required us to enter data within this system. So officially, Watershed's O&M, under the Shuminance Program,

[1:30:06] and also all of the capital projects will be entering data into this Equal Atlas project tracker.

[1:30:13] As of this year, and it is due spatially aware. And so that, in summary, the addition

[1:30:21] of that data into the Equal Atlas, by both elements of our mitigation programs, will consolidate

[1:30:27] our valley water database for mitigation and monitoring purposes.

[1:30:34] Are there any questions?

[1:30:36] Director, Vice Chair Freeman.

[1:30:39] Sure. Well, my question is, how is it?

[1:30:41] Integrate.

[1:30:43] Well, actually, I was going to go down the integration path,

[1:30:48] but I was also thinking about this committee,

[1:30:50] we're spinning up about looking at ecological balance sheets

[1:30:55] And,

[1:30:59] you know, the fact that more and more financial players like people who borrow money care about, you know, what's your ecological assets and can we get data out of the system and can it tie into our ERP, I guess, and a future ecological balance sheet and income statement and things like that.

[1:31:23] Okay, is Mike Cook still on where you can help out what how that will tie into the ERP, Mike?

[1:31:33] I'm not quite, I'm not quite familiar with the term of the ecological balance.

[1:31:38] I think we're first talking about the geospatial system, the ECO Atlas first.

[1:31:43] How about that?

[1:31:44] Okay.

[1:31:45] So that the ERP solution is really focused on, you know, financial transactions in HR transactions.

[1:31:54] So what Jen is referring to here is kind of a different stack of applications that we currently have that are that are again all integrated.

[1:32:03] So, well, well, there are integration points between maximum and GA, some of these products that Jen was speaking of between the ERP they are related to things like financial transactions, things that we've bought that are then getting their their information stored as an asset inside of maximum.

[1:32:20] or like labor hours and side of the maximum that also need to be accounted for on the ERP system.

[1:32:25] So that's kind of where those integrations lie.

[1:32:29] But outside of the ERP sphere, the tools and systems that we're mentioned here are all heavily, heavily dependent upon one another with very complex integrations.

[1:32:43] And in all cases off the top of my head, in all cases off the top of my head, only one copy of the data exists, maximum is the owner of the asset information.

[1:32:52] The GIS databases, the owner of the geospatial information and the other applications are using that as their source data sets.

[1:32:59] So when we're talking about the development of these cloud applications and these move the cloud applications, it's not just like one or two things that are moving.

[1:33:05] we're talking about picking up whole databases and doing cloud migrations with them so they

[1:33:09] can all continue to interact together. Because I guess that's a good time to do those integrations

[1:33:15] when you're moving up to the cloud. So the maximum of the mobile maximum, I guess it's just a look

[1:33:23] at the data mobile layer. Yes, it is a front-end only. All right. And this in this, the one place

[1:33:31] the story isn't maximum.

[1:33:34] Correct.

[1:33:35] Thank you.

[1:33:39] So actually I have a question of you, Vice Chair Cremont.

[1:33:42] So is your interest in being able to capture the investment that we're making doing

[1:33:50] these things so that somehow we can be getting credit for it.

[1:33:53] Like we're not just doing it to satisfy other agencies, so I mean, we are doing that.

[1:34:00] But we want to be able to say, whether it's to the public or other parties, look, this is what we're spending and this is what we're spending it on and this is the areas of the county we're spending it in is that kind of the direction you're going in.

[1:34:16] Yeah, but it's just not to the public. It's actually to the financial community who's gives, who's starting to give credit and dedicated funds to green financing.

[1:34:28] So, for example, they treat someone who has a poor water shed different than someone who's done a lot of work in the water shed.

[1:34:39] And it actually has a financial impact.

[1:34:43] So, yes, it's the public and stakeholders, but there's increasing pools of money.

[1:34:49] I mean, our treasure could probably talk about that.

[1:34:52] It's got ESG money that rewards people or firms or entity.

[1:35:00] I was kind of what my thinking on this was. I don't know if you were have those fence of thoughts as well. And maybe that's something that this environmental committee could be taking a look at.

[1:35:09] Yeah, exactly. Yes, thank you.

[1:35:12] Okay, great.

[1:35:14] Well, thank you very much, Ms. podium. Any comment, additional comments or questions by committee members? I'm not seeing any.

[1:35:23] I don't see any member of the public that would like to speak on this and I just would like to

[1:35:29] thanks to that's a lot of work that you have done and it's right that we are almost done with it.

[1:35:35] So thank you.

[1:35:36] Thank you.

[1:35:38] And that we were just receiving the final update.

[1:35:42] All right.

[1:35:43] So 4.8 is discussed the 2022 2024 annual audit work plan and please take away.

[1:35:52] Well, thank you. I'm going to turn it over to our chief audit executive.

[1:35:56] I'm Mr. Skiles.

[1:36:01] So what we did was plan out the three separate performance audits that were identified in the last meeting.

[1:36:12] The first being the CIP process, the second being emergency response and the third being data management.

[1:36:19] I believe in the, in the audit plan, those were items,

[1:36:28] one, three and six,

[1:36:36] and so what they did

[1:36:37] in that memorandum is basically provide a brief chart that showed when we were planning

[1:36:44] to start and end each one throughout the course of this year. So as you can see,

[1:36:49] And we would plan on possibly starting the CIP process

[1:36:54] the first of the three audits.

[1:36:56] We'd be started in March and with an anticipated clothes

[1:37:00] in September.

[1:37:01] That's a little bit longer of a timeframe

[1:37:03] than we typically have in a performance audit,

[1:37:05] but my thought in this performance audit would be,

[1:37:08] looking at a broader scope than just the CIP planning process

[1:37:14] and number one, but looking at the CIP life cycle,

[1:37:17] which includes elements of items, number one, 12 and 26, and some overlap. So it's a

[1:37:26] little bit bigger in scope that I think we would typically do. With emergency response starting

[1:37:33] two months later, and ending in October. So we basically are planning a stagger start of two months

[1:37:42] for each project with data management,

[1:37:44] then starting in July.

[1:37:46] What that does is it allows us to have project completions

[1:37:50] stagger in the toward the end of the year,

[1:37:53] which would be the first project completed

[1:37:56] at CIP process, completing in September,

[1:38:00] then emergency response in October,

[1:38:03] and then finally data management December.

[1:38:05] So with these being projects that are not likely going

[1:38:10] see a great deal of overlap among staff and the staff support for working with us in the audit.

[1:38:19] It looks doable. There's a lot of work usually in the audit process and the starting up and then

[1:38:25] of the closing down. And then in the field where it's sort of that middle part of an audit,

[1:38:29] it's a lot of us doing analysis. We're not always bothering staff throughout that whole time.

[1:38:36] There certainly are a lot of follow-ups and walkthroughs and interviews and so forth, but there's a lot of data analysis.

[1:38:44] So figure staggering the audits, the three different audits in this manner would produce a least, would be least-intreative on staff,

[1:38:52] allowing us to complete these three audits during the calendar year.

[1:38:58] And then I provided as well a audit scoping document for the first audit, the CIP audit.

[1:39:06] And that's on page 29.

[1:39:08] It's attachment to page 3.

[1:39:11] And this, what we try to do with these scoping documents is this one might be a little bit more detailed than we might always provide.

[1:39:19] But we try to get a sense of what the scope of the audit is, what we are planning on looking at and what this does is it gives

[1:39:26] The committee and opportunity, an opportunity to ask us,

[1:39:30] hey, are you going to look at this?

[1:39:31] I don't see this particular subject in here.

[1:39:34] Is that something that you're interested in?

[1:39:36] But it's at a high level providing it an idea of what this scope is,

[1:40:00] It provides scheduling and budget information.

[1:40:11] And I don't know if anyone has any questions. I'm happy to answer those at this point.

[1:40:16] I don't have questions so much as maybe a couple of comments, which is, you know, given the size of our CIP.

[1:40:24] If we're able to identify even, you know, modest improvements, there's certainly the opportunity to save a lot of money and I think that that's a real positive and I do like on the second page the last part of the audit field work where you talk about conduct benchmarking research to identify best practices and CIP planning and monitoring large water districts and public works agencies in California.

[1:40:51] Yeah, so comparing the results with practices observed at

[1:40:56] bellywater and looking at what best practices, what other best practices are out there,

[1:41:02] I think that that does give us a great roadmap if we wanted to move the

[1:41:09] head and make some process improvements.

[1:41:15] So, there and is there anything you would like to add and then I will ask the

[1:41:20] many members for questions.

[1:41:21] Do you feel the schedule is doable as some is your skills

[1:41:25] was mentioning?

[1:41:27] Yeah, thank you for that question.

[1:41:29] I do appreciate the schedule as it was laid out.

[1:41:32] And I appreciate the preparation

[1:41:34] of the scoping document for the first thought.

[1:41:36] I do want to say one thing about the scoping document

[1:41:39] and that just kind of looking at the field work

[1:41:42] and the scope of that first thought it,

[1:41:44] it seems awfully big to me.

[1:41:46] I mean, really, really big.

[1:41:48] And so I just wanted to provide that feedback and maybe that's something that can have for their discussion with Mr.

[1:41:57] Skiles on that, but that's my fear is that it's it's just to like not do a little too big.

[1:42:02] So that's my comment.

[1:42:04] Okay, so there'll be some discussions in terms of the evaluating this scope and we can see a refined document perhaps at our next meeting.

[1:42:17] George, anything you'd like to add?

[1:42:20] Yeah, I think I would say I appreciate that.

[1:42:25] One of the things that we incorporate into this

[1:42:29] is in the audit planning phase.

[1:42:32] So we start off with our anticipated audit field work steps

[1:42:39] but they're anticipated.

[1:42:40] We don't always know and we didn't conduct the risk assessment.

[1:42:44] So in any audit and this is, we're quite used to this.

[1:42:49] We have a lot of times we'll respond to RFPs to conduct an audit and sometimes they're very detailed, sometimes they're not, we don't always know what we're going to see when we get in there.

[1:42:59] And so it may be that the magnitude is so significantly larger than we're anticipating, but we have done a fair number of audits that relate to this activity.

[1:43:11] So if I think we have a good sense, but there is always the potential that when we get in where

[1:43:18] surprised at the magnitude, but we have a process of identifying that very early on in the audit

[1:43:24] process that that planning phase. And what we'll do with our audit field, our proposed audit field

[1:43:31] work steps is we'll start to modify those procedures to ensure that we can complete the audit

[1:43:37] objective and answer the key questions within the resources that we're allocated.

[1:43:42] Including the budget. Yeah, budget and time. Right. And so we'll adjust the methodology.

[1:43:50] And if we ever get to the point and I can say honestly, I don't think it's ever happened

[1:43:56] in my 22 years doing this. What I said, you know what I would. What we will be committed to

[1:44:04] So far off of what we'll be able to accomplish,

[1:44:06] we have to read this at the scope.

[1:44:10] But this planning phase was that very early phase of the audit

[1:44:14] is when we would capture that and then come back to you.

[1:44:17] That's where is that process built in?

[1:44:19] I don't anticipate it, but, you know,

[1:44:23] there's always the potential for being wrong

[1:44:26] when preparing a plan.

[1:44:28] Right, and you have broken that out,

[1:44:31] the foundation and planning and that would be a time where we could, you know, take another look at that.

[1:45:00] But again, getting back to my earlier comment, you know, if we were able to even achieve a 1% reduction in our CIP costs, I mean, that would be a huge amount of money.

[1:45:13] And if we were able to do something more than that, you know, we really would be able to move the needle, I think.

[1:45:18] So I'd like to if Vice Chair Cremon or Director Sanchez has any questions or comments on this. Dr. Sanchez.

[1:45:28] Oh, this has been very, very interesting and excellent work. Thank you.

[1:45:33] Vice Chair Cremon.

[1:45:34] Thank you. Thank you.

[1:45:36] Okay. Well, this is exciting and I look forward to to this and the other audits, you know, as we.

[1:45:45] What we spent a lot of time today talking about the third one data management, so clearly that's an interest on the part of the committee and emergency response is really a critical item too.

[1:45:58] I mean, we have who would have thought six months ago, we would all be worried about visiting the Ukraine or avoiding Ukraine, you know, I mean, we live in very unsettled times.

[1:46:09] So we have to be prepared for all eventualities.

[1:46:12] So thank you very much.

[1:46:13] And we look forward to seeing more work on that.

[1:46:16] And that, let's see.

[1:46:21] So I make sure that we have taken, we've discussed it.

[1:46:25] OK, I don't see any members of the public wishing

[1:46:27] to speak.

[1:46:29] And our next item is review and discuss the 2022

[1:46:32] board-optic committee work plan, Mr. Taylor.

[1:46:36] That's thank you.

[1:46:37] And I just just real quick on this item.

[1:46:39] We did make some minor edits to the audit work plan or the committee work plan, many

[1:46:48] forward administrative tasks, pushing the discussion of the annual audit training out to

[1:46:53] the April meeting, things like that. So just really, really minor edits to schedule and

[1:46:59] I'll open up to the committee for any comments

[1:47:07] somewhere in here. I didn't see it earlier

[1:47:10] but I might have missed it.

[1:47:14] We split out from the district councils audit,

[1:47:22] an item to do with how things were were not categorized

[1:47:30] as confidential information.

[1:47:34] Is that on our calendar or not?

[1:47:36] I think we're willing to see how the discussion went today

[1:47:39] with regard to the district council's audit, and we can certainly put that on the schedule. It's not on there.

[1:47:47] Well, maybe we could just briefly touch on it here, which was, and I think this came as a result of input from you, Vice Chair Creman, about whether things were being classified as, you know, confidential that maybe could be public.

[1:48:07] But I think it had more to do with the operations under the previous district council, is this still a concern for you?

[1:48:15] It is not.

[1:48:16] Okay.

[1:48:17] I love the fact that we don't have to do this.

[1:48:21] And we'll save time and money, and we can focus on other things.

[1:48:25] Great.

[1:48:26] And Director Santos, do you concur?

[1:48:28] Yes.

[1:48:29] Okay.

[1:48:30] I just wanted to make sure that we close the loop on that.

[1:48:32] So that's good news.

[1:48:34] Anyone have any comments, you know, we always end up changing things a little bit, but it is good to have these things made out for us.

[1:48:45] They're in anything you'd like to highlight at this time.

[1:48:48] Nothing else.

[1:48:49] Okay, well, I think that is that's all right, and 4.10 financial auditors selection process discussion.

[1:49:02] Darren. Yes, thank you. This is a continuation of the discussion at the last committee meeting with regard to the selection process for the new financial order and we're bringing full recommendations for the committee with regard to selecting a financial order that meets the boards needs in the first recommendation is to incorporate language into the minimum qualification section of the RFP.

[1:49:30] the two that says something on the order of experience conducting financial audits of other

[1:49:35] public utilities and districts within California of a similar size or larger than valley water

[1:49:40] in terms of things like revenue assets, customers, complexity, things like that.

[1:49:45] Then the second recommendation is that the that as the RFP is drafted that staff could send out

[1:49:53] a draft of the minimum qualification section or other sections that the committee would like to see

[1:49:58] more for review and

[1:50:01] It's particularly helpful to see who are the financial auditors serving other large public facilities. That's very informative. And having the criteria, really say that we want someone with a level of capability that has dealt with agencies outside is is helpful as well to represent us to your thoughts.

[1:50:21] I think that's excellent. Thank you.

[1:50:23] Okay. I'm not sure that I feel that Zone 7's auditor is that funny.

[1:50:31] I was going to say that, but do you know what? It's good to hear from the slow as a big one.

[1:50:38] But maybe funny.

[1:50:42] Okay. All right.

[1:50:44] So the recommendation is to approve the staff recommendations to be incorporated to financial auditor selection process.

[1:50:51] I think Mr. Hopper, it's okay just we don't have to take a formal action, we can, it's just a consensus of the committee, correct?

[1:51:00] That's fine, yes.

[1:51:02] Okay, we all support this.

[1:51:03] Okay, thank you very much, everyone, great discussion.

[1:51:08] Item five is clerk review and clarification of committee requests.

[1:51:11] Thank you, Jerky.

[1:51:13] I do not have anything for clarification at this time.

[1:51:16] Great.

[1:51:17] All right, well we will now adjourn to our regular meeting at 2 p.m. on March 16, 2022.

[1:51:23] Everyone stays safe and healthy and thank you all for a robust discussion.

Board Audit Committee - Regular Meeting - Feb 16th, 2022

Agenda

Transcript