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Home My WebLink About8 Title 3 AmendmentccAgendaItem#8TRUCKEEDONNER___PublicUtilityDistrictCONSENTTo:BoardofDirectorsFrom:LisaHallDate:September05,2018Subject:ConsiderationofResolution2018-20AmendingDistrictCode,Title31.WHYTHISMATTERISBEFORETHEBOARDConsiderationofadoptingpolicychangestoTitle3,FinanceandAccountingrequiresBoardaction.2.HISTORYOnJune6,2018,staffalongwithsubjectmatterexperts,presentedaworkshoptotheBoardonthedifferencesbetweenMello-RoosfinancingandAssessmentDistrictfinancing.ThiswasfollowedbyaworkshopAugust2,2018recommendingchangestotheDistrict’sDebtIssuanceandManagementPolicy.ChangestoDistrictCodeareneededduetoSenateBill1029whichbecameeffectiveJanuary1,2017.Thenewlawincreasescompliancerequirementsforissuersofpublicdebt.TheproposedrevisionstotheDistrict’sDebtIssuanceandManagementPolicyaddresstheserequirementsandprovidewrittenguidelinesforissuingfuturedebtandmanagingoutstandingdebt.3.NEWINFORMATIONDistrictCodeTitle3wascarefullyreviewedandmodifiedtoincorporatetherequirementsofSenateBill1D29concerningtheissuanceanduseofpublicdebt.TheproposedchangestoDistrictCodereflectthecurrentregulatoryandoperatingenvironmentandareprovidedasAttachment1.TheBoardResolutionadoptingtheproposedchangesisincludedasAttachment2.4.FISCALIMPACTThereisnofiscalimpactassociatedwiththisitem.5.RECOMMENDATIONAdoptResolution2018-20,amendingDistrictCode,Title3,FinanceandAccounting.LisaHallMichaelD.HolleyAdministrativeServicesDirectorGeneralManager TITLE3FINANCEANDACCOUNTINGCHAPTERS3.01FinancialGoals3.02BudgetControl3.04Auditing3.05GovernmentalAccountingStandardsBoard(GASB)3.06ElectricSupplyProcurement3.07DebtIssuanceandManagementPolicy3.08Purchasing3.10CapitalizationPolicy3.12AccountsReceivable3.16AccountsPayable3.20Investments3.24RestrictedFunds3.32StandbyChargesandAssessmentDistrictsCHAPTER3.01FINANCIALGOALSSection:3.01.01FinancialGoals3.01.01.1ThefollowinggoalsareestablishedtopromoteandmaintainthefinancialstrengthoftheDistrict:3.01.01.01PlanningGoals•ReviewWaterandElectricMasterPlansatleasteveryfiveyears•Reviewten-yearFinanceMasterPlaneachyear•Preparetwo-yearoperatingbudgetwithsemi-annualreviews•Prepareten-yearCapitalImprovementPlan;updateannually•Reviewratestructureandlevelseverytwoyears•ReviewFinancialGoalseveryyear3.01.01.02RevenueGoals•Setoperatingrevenuestocaptureentirecosttoprovideserviceplusbuildandmaintainreservesandsatisfydebtcoverageratios•ReviewconnectionchargeseverytwoyearsandsetthemtorecoverallcostsTitle3PageI •Reviewfacilitiesfeeseverybudgetcycleandafterthecompletionofamasterplan3.01.01.03DebtGoals•Separatedebtthatisservingdevelopment(facilitiesfees),debtservingcurrentcustomers(rates),debtservingaspecialassessmentdistrict(assessments)anddebtfinancedbybillingsurcharges.Thesecategoriesofdebtshouldbeseparatelyidentifiedinthebudget;•One-halfthedebtserviceforalllong-termdebtintheaggregateisdueinthefirsttenyears•Nomorethanonehalftheprojectedannualfacilitiesfeerevenuecommittedtodebtservice•Nomorethantwenty-fivepercentofgeneralfundrevenuescommittedtodebtservice•Nodebtmorethan25-30yearmaturity•Nodebtlongerthanusefullifeoftheproject•DebtissuedbytheDistrict,eitherdirectlyorindirectly,shallbesubjecttotheseprovisionsandsection3.07,DebtIssuanceandManagementPolicy:3.01.01.04CashReserveGoals-Operations•Watergeneralfundshouldhaveacashreserveequaltotwicethehighestmonthbudgetedexpenditure(thiswillprobablybethemonthinwhichprincipalandinterestondebtisdue)•Electricgeneralfundshouldhaveacashreserveequaltoonehalfoftheannualbudgetedoperatingexpenses,excludingdepreciation•Electricratestabilizationfund(akaElectricRateReserve)shouldmaintainabalanceof$3,000,0003.01.01.05CapitalReserveGoals•Thereshouldbearevolvingwatercapitalreservefundintheamountof$4,000,000topermitprojectstobeinitiatedandfundedpriortoarrangementoflong-termdebtorotherfinancing•Thereshouldbeanelectriccapitalreservefundintheamountof$1,000,000minimum.3.01.01.06DebtReserveGoals•Thereshouldbeareservefundforeachdebtinstrumentinanamountrequiredbyeachlender.•Areservefundshouldbeestablishedandmaintainedtopayforvehicleandequipmentpurchasesasneeded.Longtermfinancingshouldbeusedwhennecessaryandthelifeoftheassetpurchasedisgreaterthan15years.(Rev0/1/2012)nne3Page2 CHAPTER3.02BUDGETCONTROLSection:3.02.010BudgetControl3.02.010.1In2008forbudgetyear2009,andeachtwobudgetyearperiodsthereafter,theGeneralManagershallsubmittotheBoardofDirectorsadraftbudgetintheformatapprovedbytheBoardofDirectorsandfollowinggenerallyacceptedaccountingstandardsforutilitybudgets.3.02.010.2BudgetperformancewillbereviewedataBoardworkshopeachsixmonthsafterthecloseoftheJuneandDecemberaccountingperiodsduringeachfiscalyear.3.02.010.3TheGeneralManagershallcausetobepreparedamemorandumaccompanyingthesemi-annualbudgetperformancereviewwhichdescribesanysignificantvariancefromplannedexpendituresandanyprojectsorneedsthathaveoccurredsinceadoptionofthebudgetthatwerenotanticipatedatthetimethebudgetwaspreparedandadopted.3.02.010.4Withrespecttothecapitalbudget,theGeneralManagerisauthorizedtomakelineitemtransferswithinanyonedepartment,providedthetotalcapitalbudgetforthatdepartmentisnotexceeded.IftheGeneralManagerdeterminesthatacapitalexpenditureisnecessarywhichwillexceedthatdepartmentscapitalbudget,he/sheshallsubmitarecommendationtotheBoardofDirectorsforabudgetamendment.3.02.010.5WhenDepartmentHeadsrequesttheBoardtoapproveprojects(operatingorcapital),theywillindicateinthedescriptionandpresentationhowmuchhasbeenbudgetedfortheprojectandifthecostsareexpectedtoexceedtheirbudget,recommendwheretheexcesscostswillbeobtained.CHAPTER3.04AUDITINGSection:3.04.010Auditing3.04.010.1HiringofAuditorsPeriodically,theBoardofDirectorswillissuearequestforproposalforthepurposeofhiringanauditfirmtoperformtheDistrict’sannualaudit.Auditorswillberequestedtoprovideanengagementletterdescribingservicestheywillperformandathreeyearfinancialproposal.Attheendofthethreeyearperiod,theBoardTitle3Page3 willissueanewrequestforproposal,orittheBoarddecidestocontinuetheservicesofthecurrentauditors,itwillaskthethencurrentauditorsforaproposaltoextendtheirservices.3.04.010.2AuditPerformanceTheauditorswillaudittheDistrictsrecordsaccordingtogenerallyacceptedauditingstandardsforpubliclyownedutilities.3.04.010.3AuditPresentationTheauditfirmwillpresenttheresultsoftheannualaudittotheBoardofDirectorsataBoardmeetingindraftform.TheBoardmayadopttheauditaspresentedorscheduletheadoptionoftheannualauditatafuturemeeting.3.04.010.4PublicationofAnnualAuditTheannualauditshallbepostedontheDistrictswebsitewithin30daysaftercompletionoftheauditandapprovalbytheBoard.ThecompleteauditwillbesenttotheDistrict’slendersandtoanypersonororganizationthatrequestsacopy.Duplicationfeesmayapply.CHAPTER3.05GOVERNMENTACCOUNTINGSTANDARDSBOARD(GASB)Periodically,theGovernmentAccountingStandardsBoard(GASH)issuesnewaccountingrulesforrecordingfinancialtransactionsthatmustbeimplementedbygovernmentagencies.Eachyear,duringtheauditpresentationprocess,anyknownnewGASHaccountingstandardsthatarerequiredtobeimplementedduringthecurrentorfutureyearswillbediscussedwiththeBoardofDirectors.IntheabsenceofGASBaccountingrules,theDistrictisrequiredtofollowFinancialAccountingStandardsBoard(FASB)accountingrulestorecordaccountingtransactions.CHAPTER3.06ELECTRICSUPPLYPROCUREMENTSections:3.06.000General3.06.010ProcurementObjectives3.06.020CommodityPricingPolicy3.06.030CounterpartyCreditPolicy3.06.040TransactingPolicy3.06.050AuthorizedTransactingProducts3.06.060TransactingAuthority3.06.070ConflictofInterest3.06.000GeneralItistheobjectiveoftheDistrictto:1.Providereliableandhighqualityelectricsupplyanddistributionsystemtomeetcurrentandfutureneeds.Tit[e3Page4 2.AssurethatnoactivitiesrelatedtoenergysupplypurchaseandsaleswillexposetheDistricttothepossibilityoflargefinanciallossesinrelationtothesizeoftheelectricsupplyreservefunds.3.Maintainandimplementalong-termenergyandloadforecast.4,MaintainandimplementanElectricSystemMasterPlan,includingtherequiredfacilitiestomeetthecurrentandfuturedemandandreliablesupply.5.Procureandcontractforlowcostelectricpowersuppliestoreliablymeetcurrentandfutureloads,consistentwiththeRenewablePortfolioStandards.6.SeekpowersupplyfromaresourcemixthatsatisfiesDistrictRenewablePortfolioStandard(RPS),CodeSection7.83.3.06.000(A)RPSSupplyObiectives:1.Maintainreliableoverallenergysupplyportfolio2.Minimizeadverseimpactofacquiringnewenergyresourcesoncustomerelectricrates.3.Renewableresourcesaredefinedasnon-fossilfueledelectricgeneratingresources,asdefinedpursuanttoPublicUtilitiesCodeSection399.3(i).3.06.000(B)RPSSupplyStrateoies1.UtilizePublicBenefitfundstoimplementprojectsandtosupplementappropriatecapitalexpenseprojects.2.StrivetoacquiresmallhydroandgeothermalelectricsupplyfromWAPA,NCPA,orUAMPSthatarelocatedwithinorcanbetransmittedtotheSierraPacificcontrolarea.3.06.010ProcurementObjectives1.Balancetheneedtopurchasesufficient,reliableelectricenergywithinDistrictRPStarget(SeeSection7.83.040)andthetoleranceforriskestablishedbytheBoardofDirectors.2.Providestableelectricratestocustomers.3.Preserveasupplycostadvantage.4.Provideprocurementcontrolproceduresthataresufficienttoidentify,evaluateandmanagerisk.3.06.020CommodityPricingPolicy1.TheGeneralManagerisresponsibleforimplementingtheElectricSupplyProcurementpolicybyoverseeingtheprocessofallratescheduledevefopmentandensuringthatallproceduresarefollowedconsistentlyandthatalltransactionsandcalculationsareappropriatelydocumented.2.CommodityPricingiscomposedoftwoprinciples:a)DirectCostRecoveryAlldirectcostsofprovidingservicewillberecoveredinrates.b)RiskManagementTotheextentpracticable,contracttermsmustprotecttheDistrictfrommajorT,tIe3Page5 negativecontingencies.3.06.030CounterpartyCreditPolicyTheobjectiveoftheCounterpartyCreditPolicyistominimizethepotentialadversefinancialimpactsontheDistrictintheeventofadefaultingcounterparty.TheDistrictwillstrivetouseJointPowerAgencies(NCPAorUAMPS)tocheckCounterpartyCreditandmeettheobjectiveofthispolicy.ThepolicyistominimizetheDistrict’screditexposureandpotentialadversefinancialimpactsby:1.Establishingcreditriskmanagementgovernanceandoversight.2.ProvidingaproceduretoenabletheDistricttoqualifyenergysuppliersandtransactwithapprovedcounterpartiesinauniformandequitablemanner.3.Providingcounterpartytransactionparameters(limits)tocontrolandmeasuretheDistrict’sexposuretoanyonesupplier,and4.Implementingamechanismtomonitorandreportonsupplyportfoliorelatedcounterpartycreditexposure.Thispolicyappliestomarket-basedcommoditytransactionsaswellastophysicalasset-basedtransactions,suchastransmissioncapacityandgenerationownership.3.06.040TransactingPolicy3.06.040(A)Anti-SpeculationSpeculativebuyingandsellingofenergyproductsisprohibited.Speculationisdefinedasbuyingenergynotneededformeetingforecastedloadorsellingenergythatisnotowned.Innoeventshalltransactionsbeenteredintotospeculateonmarketconditions.3.06.040(B)MaximumSupplyTransactionTermThemaximumtermofanysupplytransaction,eitherpurchaseorsale,shallbetenyearsexclusiveofoptionstoextend,unlessspecificallyapprovedbytheDistrictBoardofDirectors,tomeetlong-termportfolioplanningobjectives.3.06.040(C)PortfolioPerformanceandValueReportingTheElectricUtilityMaeagerDirectorshallprepareperformancereportscontaininganalysisofphysicalandfinancialpositionsofallelectriccontracts.Reportsshallbeannually,unlesstheratioofthemarketvalueofacontractfallsoutsidetherisklimitsprescribedbytheDistrictBoardofDirectors,thentheGeneralManagershallinformtheBoardofthisfactandrecommendactions.3.06.040(D)CompetitiveProcessWheneverpossible,theElectricUtilityManagerDirectorwiththeassistancefromNCPAorUAMPSorotherentitiesapprovedbytheBoardshallobtainthreeormorequotationswhenmbaPago6 makingapurchaseorsaletransactionandselectthebestpricefromaresponsiblequalifiedbidder.3.06.040(E)OversightTheElectricUtilityManagef—Director_shallprovideanoversightrolealongwiththeAdministrativeServicesManager-Director_bothreportingtotheGeneralManager:1.TheElectricUtilityManager-Director_shallperformreviewofportfolioexposure,creditexposure,transactioncomplianceandmonitorrisklimitcompliance.2.TheElectricUtilityManagerDirectorshallmakerecommendationstotheGeneralManagertotemporarilyorpermanentlyhalttransactionswithoneormorecounterparties,exceptionstorulesandprocedures,orotheroperationalexceptionsthatrepresentunacceptableriskexposure.3.TheAdministrativeServicesManager--Director_shallreviewalltransactions,exceptions,andsettlementpaymentaccuracy,reportingfindingstotheGeneralManager.3.06.050AuthorizedTransactingProductsProductsallowedforelectrictransactionsincludeenergy,capacity,transmissionandancillaryservice.OnlyphysicaltransactingproductsareapprovedbytheBoard.Financialproductsareexplicitlyprohibited.OnlytheElectricUtilityManagerDirector,withGeneralManager’scountersignature,isauthorizedtoperformaDistrictenergytransaction:1.Alltransactionsmustbecommittedbyauthorizedtransactionpersonnel.2.AlltransactionsmustbewithapprovedcounterpartieswithexecutedandBoardapprovedcontracts.3.Alltransactionsmustbewithapprovedcounterpadieswithadequateavailablecredit.4.Alltransactionsmustbecommittedoverrecordedphonelinesorviaelectronicmail.5.Alltransactionsmustbeforallowedtransactionproducts.6.AlltransactionsmustbeconsistentwithElectricSupplyProcurementpolicy.FailuretoobserveandcomplywiththisPolicywhenexecutingenergytransactionsisaviolationofDistrictCodeandissubjecttodisciplinaryaction.3.06.060TransactingAuthorityTheGeneralManagerhastheauthoritytopurchaseandsellenergyproductsfortermsofuptotwoyearsunderopenpurchasecontracts.AuthoritytoenterintotransactionsmustbebasedonDistrictBoardofDirectorsapprovedcontractssuchasmasteragreements,purchaseagreementsorothercontractualforms.InallcasestheDistrictCodeprovidesthefinalauthorizationrulesandregulationsforenergypurchases.3.06.070ConflictofInterestPersonnelinvolvedintransactingandoversightofthentLsaPage7 Districtenergysupplyresourceacquisitionproductsmaynotengageinfinancialconflictsofinterest,unlesstheDistrictBoardofDirectorsaredulyinformedanditelectstowaivesuchconflicts.Allpersonnelinprocuringorselectingcounterpadiesforcontractingortransactingarerequiredtocomplete,onanannualbasis,theForm700DisclosureformsandsubmittheseformstotheDistrictClerk.TheGeneralManagerisresponsibleforroutinelyreviewingtheForm700ofeachpersonnelengagedinthesupplyresourcedecision-makingprocessforthepurposeofidentifyingpotentialconflictsofinterest.DistrictCounselwillassisttheGeneralManagerinreviewingtheseformsandprovidinglegaladviceinconnectionwithsuchreviews.CHAPTER3.07--1Formatted:CenteredDEBTISSUANCEANDMANAGEMENTPOLICY3.07.00DebtIssuanceandManagementPolicy3.07.01Purpose3.07.02Obiectives3.07.03Policy3.07.04AuthorizationandTypesofDebtAuthorizedforIssuance3.07.05Land-BasedFinancings3.07.06StructureofDebtIssues3.07.07SaleofSecurities3.07.08CreditRatingAgencies3.07.09RefundingandRestructuringOutstandingDebt3.07.10InternalControls3.07.11SenateBill1029ComplianceCHAPTER3.07FINANCIALGOALS3.07.00IntroductionTheDebtIssuanceandManagementPolicy(the“Policy”)provideswrittenguidelinesforissuingdebtandmanagingoutstandingdebtandisintendedtoguidepolicymakersregardingthetimingandpurposesforwhichdebtmaybeissued,typesandamountsofpermissibledebt,andmethodofsalethatmaybeusedinsatisfactionofthereguirementsofCaliforniaSenateBill1029,codifiedaspartofGovernmentCodeSection8855.ThisdebtpolicyisintendedtoguidetheDistrictinmanagingandissuingdebtinordertoprotecttheDistrict’sfinancialpositionandcreditratings.3.07.01PurposeThepurposeofthisPolicyistoprovidefunctionaltoolsfordebt-management,capitalplanning,andcashflowmanagementinaconservativeandDrudentmanner.TheDistrict’smostappropriateuseofdebtfinancingisforthepurchaseorconstructionofmaiorcapitalfacilitiesthatwillserveasalong-termcommunityasset.ThepoliciesoutlinedbelowarenotintendedtoserveasalistofrulesfortheDistrict’sdebtissuanceprocess,butrathertoserveasasetofguidelinestoDromotesoundfinancialmanagement.ljonTlatted:Justified-(Formatted:Font:(Ddault)ANal—-[Formatted:Font:(Oerauit)ANal1.ThePolicyasdescribedhereinisinaccordancewithcurrentlegislationand-ormatted:Fcnt:(oefault)Anal,12ptincorporatesindustrybestpractices.IthasbeendevisedtoserveasapublicrepresentationofDistrictobiectivesinrelationtoitsuseofanydebtobligation.The..—{nnatteci:Font:(Default)ANal1Formatted:Font:(Oefault)AnalfltleaPagee PolicyisfurtherintendedtomemorializeguidingdirectivesfromtheBoardofDirectors(“Board”)tomanagementandstafffordecisionsandrecommendationsrelatedtothefinancialgoalsoftheDistrict.2.ThePolicymaybeappliedtoanyrelatedentitiestotheDistricttotheextentthatentitydoesnothaveaseDaratepolicy.3.ThePolicywasdraftedwiththeintentofproyidingBoardapprovedguidingdirectivestomanagementandstafffordecisionsandrecommendationsrelatedtothefinancialprofileoftheDistrict,andisintendedtosupporttheDistrict’sdebtobligationstopresentandfuturegenerationsofcustomers.ThePolicyisintendedtoberevisitedandupdatedperiodicallyifthereisamaterialchangeintheriskexposuresorcondidgns.4.TheDistrictacknowledgesthatthecapitalmarketplacefluctuates,financialproductschangefromtimetotime,andthatissuerandinvestorsupolyanddemandvary.ThesefluctuaUoi,smayproducesituationsthatarenotanticiDatedorcoveredbythispolicy.Assuch,theBoardmaymakeexceptionsormodificationstothispolicytoachievethedebtmanapementgoalsoutlinedbelow.Manaaerpentflexibilityisappropriateandnecessaryinsuchsituations,providedspecificauthorizationisgrantedbytheBoard.5.Waiver.TheBoardmaywaiveanyprovisionofthePolicyifitdeterminesthatthewaiverisappropriateforpparticularissueorinthepublicinterest.-[Formatted:Font:(Default)Arlal3.07.02ObiectivesTheBoardintendsthattheDistrictestablishandmaintainaframeworkforpublicfinanceborrowingssuchasgeneralobligationbonds(“GOBonds”).certificatesofparticipation(“COPs”),communityfacilitiesdistrictsbonds(“CFD59.assessmentdistrictsbonds(“ADs”),andotherformsofindebtednessissuedbyoronbehalfoftheDistrict.1.egalDistrictdebtorobligationswillbeincurredprimarilyformajorcapitalprojects,notforanyrecurringpurposesuchascurrentoperatingandmaintenanceexpenditures.Forrepairandreplacementprojects,debtfinancingmaybeusedtobettermatchtheanticipatedneedandcostswithavailablefundsonhand.Smallerprojectsshouldbefundedona“pay-as-you-go”basisfromcurrentrevenues.TheDistrictshallnotconstructoracquireafacilityifitisunabletoadeguatelyprovideforthesubsequentannualoperationandmaintenancecostsofthefacilitythroughoutitsexpectedlife.Debtincurredforcapitalproiectsshallnotexceedtheusefullifeoftheproiectassets———fFormatted:Font:(Default)Ada12ptlFormatted:Font:(Default)ArlalfFormatted:Font:(Default)Arlal,12Pt,,.fFormatted:Fontcolor:customcolor(Rca(132))AI’IFormatted:Justlr,ed,Indent:Left:O.5’,Nobufletscr2.Thispolicyappliestodebtfinancingforthepaymentoffacilitiesandspecialtpx.,numbeñngfinancingforfacilitiesandservices,asguidelinestoassistconcemednartiesin‘fmatted:JustifledfollowingtheDistrictsapproachtocommunityfacilitiesdistrictandassessment.fFormatted:Fontcolor:customcolor(RGB(l,3,2)),Notdistrictfinancing.ItistheDistrict’sgoaltosupportproiectswhichaddressa,Expandedby/condensedby—{Forrnatted:Font:(Default)A,tal,12pt*-‘fFormatted:JustIfied,Indent:Left:0.5”,NobutetsornumberIngpublicneedandprovideapublicbenefit.3.Proposedprojectsrequestingdebtfinancingwillbeevaluatedtodetermineifsuch-..1i11e3Page9“fFormatted:Justified financingisfinanciallyviableandinthebestinterestoftheDistrictandcurrentandfutureDistrictandproiectresidents.A--,4.TheDistrictwillconsiderapplicationsrequestingfinancingavailableunderthelaws’oftheStateofCalifornia.TheDistrictreservestheriahttoreouestanyadditionalreports,informationorstudiesreasonablynecessaryinevaluatingtheseapplications.5.AllDistrictandanyconsultantcostsincurredinevaluatingapplicationsreguesting-H3.07.03financingwillbepaidbytheapplicant(s)byadvancedepositincrementsorasotherwiseagreedinwritingbytheDistrict.TheDistrictshallnotincuranynon-reimbursableexpenseforprocessingsuchapplications.Expensesnoteligibleforreimbursementinafinancingshallbebornebytheapplicant.followingthispolicy:PolicyTheDistrictshallpursueitsdebtmanagementgoalsby1.TheDistrictwillreviewallfundingsourcesanddeterminethebestsourcebasedonneedanduseofitemsbeingfinancedwhenfundingcapitalimprovements.TheDistrictwillreviewitscapitalimprovementprogramandbudgettodetermineifdebtissuanceisthebestsourceoffunding.2.TheDistrictshalläride}iW&thi?iaTb1Iiforeachdebtissue(withor’withoutcreditenhancement)InordertoreduceInterestcostsandtopreservefinancialflexibilityandmeetcaottalfundingreoulrements..3.TheDistrictshallconsiderdebilimitsinrelationtoessessedvaluechancesandthetaxburdenneededtomeet-long-termcgpltalreoulrements“.4.TheDistrictshallconsidermarketconditionsandDistrictcashflowswhentimingthe—-issuanceofdebt.5.TheDistrictshalldeterminetheamortization(maturity)schedulewhichwillbestfit’withtheoveralldebtstructureoftheDistrictatthetimenewdebtisissued.A--..6.TheDistinctshallo4veconsiderationtomatchingthetermofihidebiissuetotheusefulftgesofrelatedassetswheneverpractical,whileconsideringrepairand\‘‘reolacemerlcostsofthoseassetstobeIncurredInfutureyearsasanoffsettothe‘‘usefullives,andtherelatedlenathoftimeinthepayoutstructure.6föjtiiäfbijikJfd’lJIssuedTheDistrictIsorarizedisa-.communityservicesspecialdistrict,dulyorganizedandvalidlyexistinounderthelawsoftheStateofCalifornia,ThelawsoftheStateofCaliforniaauthorizetheIssuanceofdebtoftheDistrictand/ccôonferuoonitthepowerandeuthodtvtomakeleasepayments.contractdebt,borrowmoney.andIssuebondsforpublicimorovementproiects.TheDistrictmay,undertheseorovisions.contract,debttopayforthecostofacquiring,constructing,Formatted:Font:(Default)Arlal,12PtFormatted:Justified,Indent:Left:0.5’,NDbullettornumberingFormatted:JustifiedFormatted:Left,Nobulletsornumbering1Formatted:Font:(Default)Arlal,12PtFormatted:JustifiedFormaftedtFont:(Default)ArIa?,12ptFormatted:Justified,Indent:Left:0.5’,Nobulletsornumbedng[Formatted:JustIfiedFormatted:Font:(Default)Adal,12PtFormattednJuttlfled,Indent:Left:0.5”,NobulletsornumberIng(Formatted:Justified(1tted:Font:(Default)Anal,12Pt(omi.ueci:Fontcolor:CuttomColDr(RGB(1,3,2))Formatted:Font:(Default)Anlal,12ptFormatted:Justified,Indent:Left:0.5”,NobulletsornumberingFormatted:JustlfiedEFormatted:Fontcolor:CustomColor(RGa(1,3,2))Formatted:Font:(Default)Arlal,t2ptFormatted:Font:(Default)Adalreconstructing.kt,pmVlng.extendino.enlaroinaandeoulcoinoDistrictorolectsandorfacilities,ortorefundexistingdebtoftheDistrict.——jFormatted:Font:(Default)Arlal1..Debtissuesmaybeusedtofinancecanltalfadlities.projectsandcertaincapital--Formatted:!ont.L(Default)AHal,12ptFormatted:Justified,Indent:Left:05”,NDbulletsornumberingFormatted:JustifiedequipmentwhereftIsaoomorlatetospreadthecostoftheprojectsovermorethanTNe3Pagolo onefiscalyear.2.Projectswhicharenotappropriateforspreadingcostsoverfutureyearsshallnotbedebtfinanced.3.Long-termdebtshall,undernocircumstances,beusedtofundDistrictoperations.4.TheDistrictmayissuelong-termdebtwhichmayinclude,butisnotlimitedto,GeneralObligationBonds,LeaseRevenueBonds,CertificatesofParticipation,CommunityFacilitiesDistricts,AssessmentDistrictsand/orothercapitalleasepurchasestructuresforcapitalfacilitiesandprojects,includingfeeswhichfundcapitalfacilities,.O7.05Land-BasedFinancings----•__jFormaftedFont:(Defaut)ArlaI1.PublicPurpose,Therewillbeaclearlyarticulatedpublicpurposeinforming--[Formatted:Font:(Default)MaI,12ptanassessmentorspecialtaxdistrictinfinancingpublicinfrastructureimprovements.Boardapprovalmustbeobtainedtousethisformoffinancing.2.TheDistrictshallhavefinaldeterminationastoanyfacility’seligibilityforfinancing,aswellastheprioritizationoffacilitiestobeincludedwithinacommunityfacilitiesorassessmentdistrict.3.TheDistrictshallevaluatethepriorityofsuchitemsonaprojectbyprojectbasis.TheDistrictmayalsorequireapplicantstocommitsignificantequitytoprojectsforwhichpublicfinancingassistanceisrequested.4.EligibleImprovements.ExceptasotherwisedeterminedbytheDistrictwhenproceedingsfordistrictformationarecommenced,preferenceinfinancingpublicimprovementsthroughaspecialtaxdistrictwillbegivenforthosepublicimprovementsthathelpachieveclearlyidentifiedcommunityfacilityandinfrastructuregoalsinaccordancewithadoptedfacilityandinfrastructureplansassetforthinkeypolicydocumentssuchastheWaterandElectricMasterPlans,FinanceMasterPlan,orCapitalImprovementPlan.5.Suchimprovementsincludestudy,design,constructionand/oracguisitionof:a.Electricfacilities;b.Waterfacilities;c.Specialdistrictfacilitiesandimprovementssuchasoffices,informationtechnologysystemsandtelecommunicationsystems;andd.OtherfacilitiesauthorizedpursuanttotheMello-RoosorAssessmentDistrictActsasmaybeamendedfromtimetotime.6.District’sRole.TheDistrictshallevaluateland-basedfinancingrequestsonacasebycasebasisandwilldeterminethebestformoffinancing.AnycostsincurredbytheDistrictinretainingservicesorparticipatinginland-basedfinancingshallbetheresponsibilityofthepropertyownersordeveloper,andwillbeadvancedviaadepositwhenanapplicationisfiled;orwillbepaidonacontingencyfeebasisfrombondproceeds.TitIo3Pagell 7.CreditQuality.Whenadeveloperrequestsland-basedfinancing,theDistrictwillcarefullyevaluatetheapplicant’sfinancialplanandabilitytocarrytheproiect,includingthepaymentofassessmentsandspecialtaxesduringbuild-out.Thismayincludedetailedbackground,creditandlenderchecks,andthepreparationofindependentappraisalreportsandmarketabsorptionstudies.Fordistrictswhereonepropertyowneraccountsformorethan25%oftheannualdebtserviceobligation,aletterofcreditfurthersecuringthefinancingmayberequired.TheDistrict’sindependentfinancialadvisor/consultantmustreviewtheproposedissuanceofthebondsforviability.Aletterofcreditisanarrangementwithabankthatprovidesadditionalsecuritythatmoneywillbeavailabletopaydebtserviceonanissue.AletterofcreditcanprovidetheDistrictwithaccesstocreditundertermsandconditionsasspecifiedinsuchagreements,Lrormatted:Font:(Default)Anal8.EquityRequirements.Land-basedfinancingshallbesubiecttoadditionalrequirements.Commercialandmixeduseproiectsshallrequire50%ofrentablespacebepre-leased.Residentialonlyproiectsshallrequirepre-saleof50%oftheunits.-jFormatted:Pont:(Default)Anal,12Pt9.ReserveFund.Areservefundshallbeestablishedinthelesseramountof:themaximumannualdebtservice;125%oftheannualayeraqedebtservice;or10%ofthebondproceeds.10.Value-to-DebtRatios.Theminimumvalue-to-debtratioshouldgenerallybe4:1“:*AFormattedThis.meanpthe.value.pf.the.property.irtjha.district.witl’Uhepubligimprovements.—%7shouldbe.atleastfourjimesjhepmounLoftheassessmentorspecialjaxdebt.IR/pecia[circumstances.after.ponferrinqandreceivingthe.concurrence,of,jhe,District’s.financial,advisor,and,bondcounselthatplower,value-to-debtratigfinancially,prudentjinde,thecircumstances:the.Districts-nay,ponside,allowingaIvalue-to-debtratigof3:1.__________________________________Formatted:Justified,RIght:0”,SpaceBefore:7.4p1,Alter:9.9pt,LInespacIng:single11.AppraisalMethodology.DeterminationofvalueofpropertyintheDistrictwill,be..JFormattedbased.uponjhejulLcash,yalue.as.shown,.onlhaadyaloremas.s.assnent.roltprupon.47an,appraisalby.anindependent,impartial,andqualified.appraiser.Jhedefinitions,4:standards..apdpssumptions,Jo.beused,for,gppraisals,willhedeterminedby.the/4/Districtonacase-by-casebasis,withinputfromDistrictconsultants,anddistrict/happlicants,andbyreferencetQrelevantplaterials,and.jnformation,promulqated,$y,/the,State.p1California,includingtheAppraisalStandardsforLand,SecuredFinancingsprepared,by,Jhe,,Californip,Debl.and.jnvestmentAdvisorv,Commission(CDIAC).12.Capitalized,InterestDuring,Constructio.Decisions,Jo.capitalize.interestwiltbemadepn,,case-by-case,basis,with,jhe,jntentJhatilpllowedjtshouldimprovethe,,credil,guality.,of,,the.bonds.pnd,reduce.borrowingcostsbenelitingboth.urrentandfuturepropertyowners.Formatted‘flIle3Page12 13.MaximuinBurdeitAnnuatpssessments(orspe,cjaijaxesjritheJDaseofMello-Roos,<icFormattedofthtvpertflnthoaopeftaxeflpeci&tsessmentflnd’spe&aF1axestayment/14_BenefitApportionment..Assessmentsantispecialtaxeswillbeapportionedifaccordingto.pformulathatislear.,understandable,equitable,and,reasonablyyelated.Jothebenefitreceivedby.prburdenallributedJo.,eacftparcel,witftyespect//jo,jtsfinancedjmprovement.,J’JoannuaLescalationjactor,willbe,permitted/rFormatted15.SoecialTaxDistrictAdministratioftinthecaseofMello-Roosorsimilarsoecialtax/Formatteddistricts,the,totalmaximumannualtaxshouldpot,exceed110%.f.annualdebt‘fseMce,.Therate.andmethodofapportionmentshouldincludeaback-up,taxjn,theaventpt,significantchangesfromthe,initial.developmentplan,,andshouldincludefcrocedurepforprepayments.NeithertheDistrictnortheCommunityFacilities///Districtshallbe,bliqatedIopay,forthecostotdeteminlnathenreoavmeMamount.Iwhichshallbepaidbytheapplicant._____________________________________16.foreclosureCovenants.Inmanagingadministrativecosts,theDistrictwillestablishminimumdelinquency.pmounts,y,owner,andfor.thedistrictasawhole.pijpcase-by-casebasiabeforejnitiatingforeclosureproceedinos.--Formatted17.Pisclosuretoflondhotders.Ingeneral,eachpropertyownerwhoaccountsformorethan20%oftheannualdebtservictorbondedindebtedness,ynustprovideongoingdisclosureinformationannually,gsdescribedunderSECRuIa.15(c)-i2..-.j_Formatted18.,Disclosure,,toProspective9urchasers.Fulldisclosure,pboututstandinqbalances--IFonllattedandannualpayments,shouldbemadebythesellertoprospective,buyers,atjhe-;/timethatjhe,buyer,bids.on,thepropertv.,,ltshouldpotbedeferredjo.pfterjhe.buyer,hasmade,the,decisiontopurchase.,Whenpppropriate,applicants.orprooerty.,owners.may.berequiredtoprovidetheDistrictwithasdoeureplan.Suchplan;’mayincludehomebuyernotificationsrequiringsignaturepdprtohomepurchases,/::!aswell,as,ynethodsjonotifysubseguepthomepurchasç_.The,,Districtayrepuire/7!thatDevelopers,pffer,residentialbuyers,the,ptioftvthayingallspecialtaxes//prepaiduponcloseofescrow,withacorrespondinaIncreaseinthepurchaseprice/oftheresidence._________________‘[Formatted:JustifledI9.,Thg.District.shaluse,altyeasonablpyneansjggnsuraDonpliancewithapplicable‘FormaftedfederalsecuritieslawsinconnectionwiththeIssuanceofdebt.-“:jFarmafted:Font:(Default)Anal3.07.06StructureofDebtIssuesTheDistrictwilldetermineonacase-by-casebasiswhethertosellitsbondsthrouaha,!jormetted:Font:(Default)Arta12ptJpublicsaleoraprivateplacement.‘‘Formatted:Justified,Right:0”,SpaceBefore:7.4pt,Añ1yg,gptLinespacing:single,Numbered+Level:I+1.PublIcSale.TherearetwGmethodsvi.publicsaleDf.debt.competitivgnd’NumbenngStyle:1,2,3,.+Startat:I+Alignment:Left+neootiad.Preferenceshat[beaWenia,contefitlvesales.Howeverboth,methods.-Alignedat:0.25+Indentat.0.5fFormatted(...iiii]tileSPage13 pf,sale.shallbeconsideredforallissuanceofdebttotheextentallowedbylaw,as_—,jFormattedeachmethodhasthepotentialtoachievethelowestfinancingcostgiventherightconditions,______________________________a.CompetitiveSale.WhenacompetitivebiddingprocessisdeemedthemostadvantageousmethodofsalefortheDistrict,awardshallbebasedupon,amongotherfactors,thelowestofferedtrueinterestcost,aslongasthebidadherestorequirementssetforthintheofficialnoticeofsale.formatted:Font:(Default)Adal,12ptfFormatted:Justifiedb.NegotiatedSale.TheDistrictrecognizesthatsomesecuritiesarebestsoldthroughnegotiation.WhenanegotiatedsaleprocessisdeemedthemostadvantageousmethodofsalefortheDistrict,selectionshallbebasedupon,amongotherfactors,qualifications,experience,pricingability,andtees.Formatted:Justified,Right:0,SpaceBefore:2.4pt,After:9.9Pt,unespacing:smg’e,Numbered•Level:1+Numberr.gStyle:1,2,3,-+Startat:I—Alignment:Left+__________________________________________________________________________________________________Alignedat:0.25’—Indentat:0.5’mustbestructuredforasingleorlimitednumberofpurchasers.SuchmethodOiZ,’Fw,utted‘fjjflsaleshallbeconsideredif,itis.demonstrated.Jyesultjn,postavings,pcprovide,.7’ptheradvantagesrelativetoother,methods,pfdebtjssuancopr,jf,jtjs,etermined.hataccessto.thepublicmarketjn,pnavailable,and,timingconsiderations,require,jhats,,financingbecompleted.-3.07.08CreditRatingAgencies..,_-tted:Font:(Default)Anal1.inpublicissuanceofdebt,theDistrictwillstrivetoachievethebestpossiblecredit-tFormatted:Juulratingforeachdebtissue(withorwithoutcreditenhancement),----..—.—IFormatted:Justified,Right:D’,SpaceBefore:7.4Pt,After:I.spt,Linespacing:sir4e,Numbered—Level:I2.,lftprivateplacemenLtheDistricLwillconsder,Tha.debtJssuance.pnits,,overplLpmditNumberhigstyle:1,2,3,.5b,lat:I-Mignment:Left+Alignedat:0.25•Indentat:0.5rating.•___________________________________________________________Formatted:Font:(Default)Mial,12pt,Fontcola:BackFormatted_______________________________________________________________________Formatted:Font:(Default)Anal1.Wheneverdeemedtobe.jn.thebestjnterestnUfieDSjictJfi.aDistrictrnay.,consider--niattedJusufindrefunding.or.yestructuringoutstanding,debt.Formatted:Font:(Defa’it)Wlal,12PIreviewot.pne(presenyalueain,order,tomake.a’determinationregardingthecost-effectivenessoftheococosedrefunding.“N’______________________________________{jrrnatteda.Generally,theDistrictmayinitiatearefundingwhenthree(3.00%)percentnetDresentvalueorgreatersavingsasapercentageoftherefundedaggregateprincipalamountcanbeachieved.2.PrivatePlacement.AtitselectiontheDistrictmayissuedebtonaprivateplacement—--basis.Whilenotusedasfrequentlyasnegotiatedorcompetitivepublicsalemethods,aprivateplacementsalemaybe,aporopriate,when,jhe.Jinancingpappr.3.07.09RefundingandRestructuring0L4.t.ndlnpDebt2.Thefinancialadvantagesofrefundingoutstandingdebtshallbebaseduponab.ThetargetnetpresentvaluesavingsasapercentageoftheFormatted:Foflt:(Default)AHal,12pt1151Formatted:)uat:f.ed,R:ght:o’,spaceBefore:7.4p1.After:ISpt,unespacf’.g:sir4e,Nn’.bered+Levei:I+NumberingStyle:1,2,3,...+Startat:1+Alignment:Left+Alignedat:0.25”+indentat:0.5”refundedaggregateprincipalamountshallbenolessthanthree-.—.çFOflflftdFont:(Default)Adal,12Pt‘Ejormatted:JustIfiedTitlesPage14 (3.00%)percentatthetimeofsale.Thisfigureshouldserveonlyasaguideline;theDistrictmustevaluateeachrefundingopportunityonacase-by-casebasisandmusttakeintoconsideration:timetomaturity;sizeoftheissues;currentinterestrateenvironment;annualcashflowsavinos;andthevalueofthecalloption.TheGeneralManagerorhisdesigneeshallhavethediscretiontodesignatealowerpercentagesavingsifapplicable.a.Alldebttransactionsmustbeapprovedbytheapplicablegoverningboard.Theproceedsofbondsaleswillbeinvesteduntilusedfortheintendedproiect(s)inordertomaximizeutilizationofthepublicfunds.Theinvestmentswillbemadetoobtainthehighestlevelof1)safety,2)liguidity,and3)yield,andmaybeheldascash.TheGeneralManagerordesignatewiltoverseetheinvestmentofbondproceeds.b.BondproceedswillbedepositedandrecordedinseparateaccountstoensurefundsarenotcomingledwithotherformsofDistrictfunds.TheDistrict’sTrusteeorFiscalAgentwilladministerthedisbursementofbondproceedspursuanttoeachcertainIndentureofTrustorFiscalAgentAgreement,respectively.Toensureproceedsfrombondsalesareusedinaccordancewithlegalrequirements,invoicessubmittedneedtobeapprovedbytheGeneralManagerordesignatedalternateforpayment.RequisitionforthedisbursementofbondfundswillbeapprovedbytheGeneralManagerordesignatedalternate.Responsibilityforgeneralledgerreconciliationsandrecordsissegregatedfromtheinvoiceprocessing,cashreceipting,andcashdisbursementfunctions.c.TheGeneralManagerordesignatewillbetaskedwithmonitoringtheexpenditureofbondproceedstoensuretheyareusedonlyforthepurposeandauthorityforwhichthebondswereissued..07.11SenateBill1029COMPLIANCE-(Formatted:Font:(Default)AdaI1.SenateBill1029(‘SB1029”),sionedonSeptember12,2016.requiresissuersto’...,-fjormatted:Font:(Default)Artal,12Ptadoptdebtpoliciesaddressingeachofthefiveitemsbelow.TheDistrictbelievesthisPolicyisincompliancewithSB1029.a.Thepurposesforwhichthedebtproceedsmaybeused.3.07.10InternalControls1.TheDistrictshallbevigilantinusingbondproceedsinaccordancewiththestated•-purposesatthetimesuchdebtwasincurred.[Formatted:Font:(Default)Adal[Formatted:Font:(Default)Anal,12pt—Formatted:Justified,Right:0”,SpaceBefore:7.4pt,After:9.9ptLinespacing:single,Numbered+Level:I+INumberingStyle:1,2,3,4Startat:1+Alignment:Left+at:0.25”+Indentat:0.5”Formatted:Justifiedi.Section3.07.04(AuthorizationandTypesofDebtAuthorizedtoBeIssued)ofthisPolicyprovidesinformationregardingthepurposesforwhichtheDistrictmayspenddebtproceeds.Formatted:Right:0”,SpaceBefore:7.4p1,After:9.9pt.tinespacing:single,Numbered*Level:1+Numberingstyle:i,2,3,...+Startat:I+Alignment:Left+Alignedat:0.25”+Indentat:0.5”ThIs3Page15 b.Thetypesofdebtthatmaybeissued.i.Section3.07.04(AuthorizationandTypesofDebtAuthorizedtoBeIssued)ofthisPolicyprovidesinformationregardingthetypesofdebttheDistrictmayissue.c.Therelationshipofthedebtto,andintegrationwith,theissuer’scapitalimproyementprogramorbudget,ifapplicable.Formatted:Justifiedi.Section3.07.03(Policy)andSection3.07.06(StructureofDebtIssues)ofthisPolicyprovideinformationregardingtherelationshipbetweentheDistrict’sdebtandCapitalImprovementProgram.d.Policygoalsrelatedtotheissuersplanninggoalsandobiectives.i.Section3.07.03(Policy’)ofthisPolicydescribestheDistrict’splanninggoalsandobiectives.e.Theinternalcontrolproceduresthattheissuerhasimplemented,orwillimplement,toensurethattheproceedsoftheproposeddebtissuancewillbedirectedtotheintendeduse.i.Section3.07.10(InternalControls)ofthisPolicyprovidesinformationregardingtheDistrict’sinternalcontrolproceduresdesignedtoensurethattheproceedsofadebtissuancearespentasintended.LFormated:JustIned-(Fmmafted:JSIledSectionsCHAPTER3.08(314109,Res2009-10)PURCHASING3.08.000NotificationtoBoardofDirectors3.08.005LocalPreferenceProcurementPolicy3.08.010BidProcedureforPurchaseofCommoditiesorEquipmentOver$15,0003.05.020ProcedureforPurchaseofCommoditiesorEquipmentUnder$15,0003.08,030BidProcedureforIssuanceofServiceContractsOver$15,0003.08.040ProcedureofIssuanceofServiceContractsUnderTitle3Page16 $15,0003.08.050ProcedureforEnteringintoanAgreementforSpecialServices3.08.060JointPurchasingwiththeStateandOtherPublicAgencies3.08.070ProcessandProcedureforRetentionofConsultingSrvices3.08.080ChangeOrders3.08.090ContractorInsuranceRequirements3.08.100ProcurementAuthorizationDuringanEmergency3.08.000NotificationtoBoardPriortoorconcurrentwithgoingtobidorissuinganRFP,staffwillnotifytheBoardofDirectors.3.08.005LocalPreferenceProcurementPolicyItshallbethepolicyoftheDistricttoencouragelocalbusinessestoprovidegoodsandservicestotheDistrictinordertomaintainahealthylocaleconomy,toincreaselocalcompetition,andtolowercorecostsofgoodsandservices.Tofacilitatethispolicy,theDistrictshallmakepurchasesinaccordancewiththefollowingguidelines:3.08.005.1Localpreferenceforthepurchasesofeligiblegoodsandservicesmaybeallowedbyprovidinga5%localpreferencewherethepurchasesorcontractswitharespectivelocalvendororbusinessduringanyfiscalyeardonotexceedSi00,000.3.08.005.2Proposalsforservices,bytheirnature,areevaluatedbaseduponqualifications.A5%localpreferenceshallbeappliedtowardsthefeecomponentwhenscoringtheproposal.3.08.005.3Inordertoqualifyfortheabovelocalpreference,avendororbusinessmusteither1)beaDistrictratepayeringoodstandingforthepastsixmonths,or2)receiveDistrictpowerorwaterattheirbusinesslocationforthepastsixmonths;paidbyathirdparty.3.08.005.4Eligibleprocurementsare:•Commoditiesorequipmentupto$10,000;•Publicworkscontractsupto$15,000;•Otherservicecontractsupto$100,000;•Specialservicesupto$100,000;and•ConsultingservicesuptoS100,00D.3.08.005.5Thispolicyshallbereviewedannuallytoensureconsistencywiththeoverallpolicyobjectives.3.08.010BidProcedureforPurchaseofCommoditiesorEquipmentOver$15,000Priortoissuingapurchaseorderforthepurchaseofanycommodityorequipment,thedollarvalueofwhichisfifteenthousanddollars($15,000)orgreater,theprovisionsofthePublicContractCodeshallbefollowed,asmorefullydescribedinthefollowingsections.tte3Page17 3.08.010.1WhenaDepartmentDirector,Manager—ortheauthorizedBuyer/Clerkdeterminesthatthereisaneedtoissueapurchaseorder,theamountofwhichisfifteenthousanddollars($15,000)orgreater,he/sheshallnotifytheGeneralManagerbymemorandumwhichstatesthepurposeofthepurchase,thebudgetorworkorderaccountnumbertobechargedandthespecificationoftheitemoritemstobepurchased.3.08.010.2TheGeneralManagershallreviewthememorandumand,ifhe/sheapprovestherequest,shallcauseapublicnoticetobepublishedinalocalnewspaperofgeneralcirculationrequestinginterestedpartiestosubmitsealedbids.Thebidsshallbepubliclyopenedandreadatthedateandtimeandintheplacespecifiedinthepublicnotice.ThenoticewillalsobepostedontheDistrict’swebsite.3.08.010.3Afterthebidshavebeenopened,theGeneralManagershallsubmitthemattertotheBoardofDirectorswitharecommendationregardingawardofthepurchasecontract.3.08.010.4Whencallingforbidsonequipmentavailablelocally,thepublicnoticeshallbeasmalldisplayadinalocalnewspaperofgeneralcirculation.ThenoticewillalsobepostedontheDistrict’swebsite.3.08.010.5TheGeneralManagershallestablishprocedurestoproperlymanagetheprocessofnotifyingbiddersoftheresultsofthepurchaseandtoimplementthedecisionoftheBoard.3.08.010.6MarketBasketPurchaseApproachForvendorsfromwhommultipleitemsaremostlikelytobebought,a“marketbasket”approachmaybeusedtoselectthemostcompetitivevendor.Thisapproachcomparestheaggregatecostforanticipatedquantitiesofitemsamongvendors;thebasisforselectionisthelowestmarketbasketcost.Shouldthetotalanticipatedpurchasesexceed$15,000,approvalwillbeobtainedbytheBoard,3.08.010.7SoleSourceVendors-Certainvendorsprovidegoodsandequipmentthatareproprietaryinnaturesuchascertainutilities.Forpurchasesthatexceed$15,000,approvalwillbeobtainedbytheBoard.3.08.020ProcedureforPurchaseofCommoditiesorEquipmentUnderSi5,000Priortoissuingapurchaseorderforthepurchaseofanycommodityorequipment,withavaluewhichexceedstenthousanddollars($10,000),butislessthanfifteenthousanddollars($15,000),thefollowingproceduresshallbefollowed:3,08,020.1TheGeneralManager,aDepartmentDirector,Manager—ortheauthorizedBuyer/ClerkisauthorizedtoissueapurchaseorderasdefinedinSection3.08.020afterhavingfirstsecuredthreeinformaltelephonequotesrecordedinwriting.Insecuringthequotes,thevendorsmustbeaskedtostateanypricediscountandanypaymentdiscounttermsthatthevendorwilloffertheDistrict.Intheeventthatthreequotescannotbeobtained,thepurchasershallprovidetheGeneralManagerwithawrittenexplanationandreceivetheGeneralManager’sapprovalpriortoissuingthepurchaseorder.3.08.020.2Thepurchaseordershallbeissuedtothelowestresponsivevendortakingintoconsiderationpriceandpaymentdiscounttermsanddeliveryschedule.T,tle3Pagels 3.08.020.3Purchaseordersforthepurchaseofcommoditiesorequipment,withavalueoftenthousanddollars($10,000)orless,maybeissuedbytheGeneralManager,DepartmentHeadDirector,authorizedBuyer/Clerk,orSpecialProjectsAdministratortoanyapprovedvendorafterconsideringprice,termsanddeliveryschedule.3.08.020.4Purchaseordersforthepurchaseofcommoditiesorequipment,withavalueoffivethousanddollars($5,000)orless,maybeissuedbytheSuperintendents,SystemEngineers,ConservationProgramsAdministrator,ExecutiveSecretary/DeputyDistrictClerk,orDepartmentManagertoanyapprovedvendorafterconsideringprice,termsanddeliveryschedule.3.08.020.5Shouldoverrunsorchangeordersexpecttoexceedauthorityofthepartyissuingthepurchaseorder,thenexthigherlevelofauthorityshallbenotifiedfortheirapprovaltocontinue.3.08.030BidProcedureforIssuanceofServiceContractsOver$15,000Priortoenteringintoacontractforservices,withavalueexceedingfifteenthousanddollars($15,000),thefollowingproceduresshallbefollowed:3.08.030.1Theterm“services”includes,butisnotlimitedto,construction,maintenanceorrepairofDistrictfacilities,butdoesnotincludeprofessionalservicessuchaslegal,engineering,architectural,landscapearchitecture,landsurveying,constructionprojectmanagement,accounting,financial,economic,energyadvisory,informationtechnology,environmental,payrollservicesandadministrativeservicesasincludedwithinCaliforniaGovernmentCodeSections4525,4526and53060.3.08.030.2WhenaDepartmentManagerDirector.Manager-ortheauthorizedBuyer/Clerkdeterminesthatthereisaneedtoissueacontractforaservicetobeperformedthedollaramountofwhichisfifteenthousanddollars($15,000)orgreater,he/sheshallnotifytheGeneralManagerbymemorandumwhichstatesthepurposeoftheservice,thebudgetorworkorderaccountnumbertobechargedandtheplanand/orspecificationoftheservicetobeperformed.3.08.030.3TheGeneralManagershallreviewthememorandumand,subjecttotheprovisionsofSection3.08.030.4,ifhe/sheapprovesoftheservice,shallcauseapublicnoticetobepublishedinalocalnewspaperofgeneralcirculationrequestinginterestedpartiestosubmitsealedbids.Thebidsshallbepubliclyopenedandreadatthedate,timeandlocationspecifiedinthepublicnotice.ThenoticewillalsobepostedontheDistrict’swebsite.3.08.030.4Iftheserviceissuchthatplansand/orspecificationsneedtobepreparedbyaconsultantandthecostoftheconsultingserviceisfifteenthousanddollars($15,000)orgreater,theGeneralManagershallsubmitthemattertotheBoardofDirectorsforapprovalbeforeauthorizingtheconsultanttoproceed.3.08.030.5Iftheservicetobecontractedisofanaturethatwilllikelyattractbidsfromlocalserviceproviders,thepublicnoticeshallbeinsmalldisplayadforminalocalnewspaperofgeneralcirculation.Inaddition,advertisementsornoticesmaybemadeinappropriatetradejournalsanddependingonthescopeoftheproject,copiesofbiddocumentswillbesenttonile3Page19 localplanroomlibraries.Iftheprojectisnotlikelytoattractlocalbidders,theadistobeplacedonlyinthepublicnoticesectionofthenewspaperandinappropriatetradejournals.Ineithercase,thenoticewillbepostedontheDistrict’swebsite.3.08.030.6Afterthebidshavebeenopened,theGeneralManagershallsubmitthemattertotheBoardofDirectorsforapprovalwitharecommendationregardingawardoftheservicecontract.ThisrecommendationwillincludethebidawardamountandanottoexceedamountforchangeorderstobeauthorizedbytheGeneralManager.3.08.030.7TheGeneralManagershallestablishprocedurestoproperlymanagetheprocessofnotifyingbiddersoftheresultsoftheawardandtoimplementthedecisionoftheBoard.3.08.030.8SoleSourceVendors-Certainvendorsprovideservicesthatareproprietaryinnaturesuchasutilities,Forpurchasesthatexceed$15,000.approvalwillbeobtainedbytheBoard.3.08.040ProcedureforIssuanceofServiceContractsUnderSi5.000Priortoissuanceofacontractforaservicewithavaluelessthanfifteenthousanddollars($15,000),thefollowingstepsshallbefollowed:3.08.040.1TheGeneralManagershallcauseplansand/orspecificationstobeprepared.3.08.040.2Threeinformaltelephonequotesshallbesecuredinwriting.Insecuringquotes,thecontractorshallbeaskedtostateanypriceorpaymentdiscountsandacompletiondate.3.08.040.3ThecontractshallbeawardedbytheGeneralManagertothelowestresponsiveserviceprovidertakingintoconsiderationpriceandcompletiondate.3.08.040.4TheGeneralManagermayrenegotiateand/orrenewcontractsupontheirexpiration.3.08.040.5Shouldoverrunsorchangeordersexpecttocausetheservicecontracttobecome$15,000orgreater,theGeneralManagershallnotifytheBoardofDirectorsforitsapprovaltocontinue.3.08.050ProcedureforEnteringintoanAgreementforSpecialServicesPriortoenteringintoanagreementforspecialservices,thefollowingproceduresshallbefollowed:3.08.050.1Theterm‘specialservices”includes,butisnotlimitedtoprofessionalservices,suchaslegal,engineering,architectural,landscapearchitecture,landsurveying,constructionprojectmanagement,accounting,financial,economic,energyadvisory,informationtechnology,environmental,payrollservicesandadministrativeservices,asincludedwithinCaliforniaGovernmentCodeSections4525,4526and53060.3.08.050.2WhenaDepartmentManagerDirectoror-Manager-determinesthatthereisaneedtoissueanagreementforspecialservicestobeperformed,he/sheshallnotifytheGeneralManagerbymemorandumwhichstatesthepurposeofthespecialservices,thebudgetorworkorderaccountnumbertobechargedandtheplanofthespecialservicestobeperformed.Tie3Pae2O 3.08.050.3TheGeneralManagershallreviewthememorandumandifhe/sheapprovesthespecialservices,shaltdeterminewhethertoenterintotheagreementforspecialserviceswithorwithoutseekingproposalsfrompotentialspecialserviceproviders.3.08.050.4IftheGeneralManagerdeterminesthatnoproposalsarenecessary,thenhe/shemayenterintoanagreementforthespecialservicesuptohis/herBoardauthorizedspendinglimit.ShouldtheamountexceedtheGeneralManager’sspendinglimit,approvaltoenterintoanagreementwillbebroughttotheBoardofDirectorsfortheirconsideration.3.08.050.5IftheGeneralManagerdeterminesthatproposalsarenecessary,thenhe/sheshallfollowtheproceduressetforthin3.08.070.3through3.08.070.13forpreparingandissuingaRequestforProposals(RFP)andreviewingproposals.3.08.060JointPurchasingwiththeStateofCaliforniaandOtherPublicAgenciesTheAgenciesTheDistrictmaypurchasematerials,equipment,supplies,informationtechnologyproductsandservicesthroughtheStateofCaliforniaprocurementprogramandjointlywithotherpublicagenciesinaccordancewiththefollowingprocedures.3.08.060.1NotwithstandinganyotherprovisionofthisChapter,theDistrictmaypurchasematerials,equipmentorsupplies,otherthanprintedmaterial,fromtheStateofCaliforniathroughitsprocurementprogramunderPublicContractCodeSection10290,10298,12100&12125andjointlywithotherpublicagencies,providedthat:3.08.060.1(A)TheDistrictapprovesspecificationsforanypurchaseofmaterials,equipmentorsupplies,informationtechnologyproductsandservices;3.08.060.1(B)Thecostofsuchitemsisfifteenthousanddollars($15,000)ormoreandthepurchaseisapprovedbytheBoardofDirectors;3.08.060.1(C)TheStateorpublicagencyhassolicitedoradvertisedforbidsinamannerwhichcomplieswiththecompetitivebiddingrequirementsapplicabletotheDistrict;and3.08.060.1(D)TheStateorpublicagencypurchasessuchitemsatapricereasonablyexpectedtobelowerthantheDistrictcanobtainthroughitspurchasingprocedures.3.08.060.2TheDistrictshallreimbursetheStateorotherpublicagencyforanychargemadetotheDistrictforpurchasingservices.3.08.060.3NotwithstandinganyotherprovisionsofthisChapter,theDistrictmaypurchasematerials,equipment,supplies,informationtechnologyproducts,programsandservicesotherthanprintedmaterial,fromtheStateofCaliforniathroughitsprocurementprogram,orjointlywithotherpublicagencies,whenthecostofsuchitemsislessthanfifteenthousanddollars($15,000)whentheDistrictdeterminesthatitisinitsbestintereststodoso.3.08.070ProcessandProcedureforRetentionofConsultingServicesTh!e3age2l 3.08.070.1DepartmentManagef-Directordeterminesneedforoutsideconsultingservices.3.08.070.2DepartmentManager-DirectordiscussesneedforconsultantwiththeGeneralManager.3.08.070.3UpontheGeneralManagerapproval,theDepartmentManager-Director_anddepartmentalstaffcreateadraftRequestforProposals(RFP)forreviewbytheGeneralManager.ThedraftRFPshallincludeaproposedscopeofworkandgeneraldescriptionofevaluationcriteriatobeusedinreviewingtheproposals.TheweightingofthespecificevaluationcriteriashallbeincludedintheRFP.TheRFPshallrequireaseparateTechnicalProposalandaCostProposalsealedinseparateenvelopes.3.08.070.4TheContractsAdministrativeClerk(CAC)shallbeginadvertisingtheAPP.AnoticeoftheAPPshallbemailedtoconsultantsknowntoperformtherequiredservicesandwhenappropriatetotheNEConsultantsInformationNetwork.AnoticeoftheRFPshallalsobepublishedinalocalnewspaperofgeneralcirculationandshallbepostedontheDistrict’swebsite.3.08.070.5Astaffcommitteeshallbecreatedtoreviewtheproposals.ThecommitteeshallincludestafffromatleasttwoseparateDepartments(Electric,Water,AdministrativeServices).TheexactmakeupofthecommitteeshallbedeterminedbytheGeneralManagerandDepaeei-Manage4eed-staff-eersennelDepartmentDirectorseekingtheconsultingservices.3.08.070.6TheGeneralManagerandDepailment—Manage4eed--—staffpersonnelDeadrnentDirectorshallfinalizetheproposalevaluationcriteriaandtheweightingtobegiventoeachcomponent.3.08.070.7Afterreceivingproposals,theyshallbeheldinthecustodyoftheCAC.TheCACshalldistributecopiesofallTechnicalProposalstothestaffcommitteemembersforindividualreview.3.08.070.8Thestaffcommitteeshallthenholdameetingtodiscussthevariousproposalsandtoranktheconsultantsbasedupondemonstratedcompetence,professionalqualificationsandtechnicalmeritusingtheapprovedevaluationcriteria.3.08.070.9Atthesamemeeting,aftercompletionofthetechnicalrankings,theCostProposalsshallbeopenedandreviewedbythestaffcommitteemembers.Thisreviewshallensurethatthemanhours,hourlyrates,servicesandindirectcostsgivenintheCostProposalcorrespondtothelevelofeffortdescribedintheTechnicalProposalandtothelevelofeffortexpectedbytheDistricttoperformtheanticipatedwork.3.08.070.10ThestaffcommitteeshallmeettodiscussboththeTechnicalandCostProposalsanddetermineashortlistofconsultantstobeinterviewedbythestaffcommittee.3.08.070.11Afterfinalreviewoftheproposals,thestaffcommitteemaydeterminethatagivenconsultantisclearlysuperiortotheotherconsultantsandmayrecommendtothefltle3Pa9e22 GeneralManagerthatinterviewsarenotnecessary.Thestaffcommitteemayalsodeterminethattheproposedscopeofworkortheexpectedcostissuchthatconductinginterviewswillnotyieldsignificantinformationforthestaffcommitteetoconsiderandsimilarlyrecommendtothe-GeneralManagerthatinterviewsarenotnecessary.3.08.070.12Wheninterviewsaretobeconducted,theCACshallcontacttheshort-listedconsultantsandscheduleinterviews.Thedate,timeanddurationoftheinterviewsshallbedeterminedbytheDepaclrl4ent—Managec—lead—staW--personnelDepartmentDirectorinconjunctionwiththestaffcommittee.Thestaffcommitteeshallalsocreateaproposedoutlineandlistofanyquestionstobeposedtotheshodlistedconsultants.3.08.070.13Aftercompletionoftheinterviews,thestaffcommitteeshalldeterminearecommendedconsultantforpresentationtotheBoardofDirectors.Thisrecommendationshallbebasedupontheindividualconsultant’sweightedscoringandtheiroverallproposedcost.3.08.070.14TheDepartment-Managerleadstaff—personnelDepartmentDirectorshallprepareamemorandumandappropriatedocumentationforpresentationtotheBoard.Thememorandumshallsummarizethefollowing:•WorktobeperformedbytheConsultant.•Numberofproposalsreceived.•Rankingofconsultantsonatechnicalbasis.•RecommendedConsultantandexpectedcostthereof.•IftherecommendedconsultantisnottheNumber1rankedfirmontechnicalmerit,thememorandumshalldescribetherationaleusedtodeveloptherecommendation.3.08.080ChangeOrdersTheDistrictcannotaffordtomaintainalargeenoughconstructioncreworalltypesofservicerelatedskillstobeabletoundertakeallprojectsandservicesin-house.Therefore,itreliesoncontractorsandserviceproviderstoperformwork.Thesecontractorsandserviceprovidersperformworkinaccordancewithplansandspecificationsandbasedonafixedpricecontract.Thereareoccasionallycircumstancesencounteredafteracontractororserviceproviderhasbegunworkthatrequiresachangeintheplansandspecificationsorscopeofworkandresultinachangeinthecontractprice.Thesechangesaregenerallymattersthatcouldnotbeanticipatednorplannedduringthedesignandspecilicationphaseoftheproject.Thecontractchangeorderistheprocedurewherebyplansandspecificationsorscopeofworkandcontractpricecanbechangedafterthecontractisexecutedandworkhascommenced.TheBoardofDirectorsauthorizestheexecutionofcontractchangeordersuptotheGeneralManager’scontractauthorizationoruptotheindividualcontractchangeorderauthorizationpreviouslyestablishedbytheBoard.MostcontractchangeordersaresuchthattheirconsiderationbytheBoardcanwaitforaregularBoardmeeting.However,undercertaincircumstancesitistotheDistrict’sbenefittopermittheGeneralManagertoauthorizemeDepa#ment-HeadaDepartmentDirectortoproceedwithchangeorderworkortorequestaspecialboardmeetingtoconsidertheTide2Page22 matter.WorkcanproceedonacontractchangeorderpriortobeingreviewedbytheBoardofDirectorsunderthefollowingcircumstances:3.08.080.1WhenadelayinmakingthedecisiontochangethecontractwouldimposeanunreasonablefinancialburdenontheDistrict.3.08.080.2WhentheneedforthechangeissocompellingthattoproceedwiththeprojectasoriginallyplannedisimpossibleorwouldbefinanciallyburdensomeontheDistrict.3.08.080.3Whentheamountofthechangeorderpriceislessthan5%oftheoriginalapprovedcontractprice.3.08.080.4Atthetimeofawardofacontract,theBoardmaypre-approvechangeordercontingenciesuptoadefinedpercentageofthecontractoradefineddollaramount.ChangeordercontingencyauthoritywhichhasbeenapprovedbytheBoard,willbeadministeredbytheGeneralManageruptothepre-approvedlimit.3.08.080.5Theexerciseofthisprerogativeshouldbedonewithdiscretionandinthefollowingmanner:3.08.080.5(A)Amemorandumshouldbepreparedsettingforththeprecisecircumstancesjustifyingthechangeinplansandspecificationsorscopeofworkandshoutdjustifythechangeincontractprice.3.08.080.5(B)ThememorandumshouldbesignedbytheDepartmentHeadandGeneralManagerandforwardedwithin48hourstoeachDirector.3.08.080.5(C)AcontractchangeordershouldbepreparedforconsiderationbytheBoardofDirectorsatitsnextregularmeetingorataspecialmeetingifoneiscalled.3.08.090ContractorInsuranceRequirementsItisthepolicyoftheDistricttorequirecontractorsandserviceproviderspertormingworkfortheDistricttomaintainappropriateinsurancenamingtheDistrictasanadditionalinsured.3.08.090.1Theformofinsuranceshallbebroadformcomprehensivegeneralliabilitywhichincludescoverageforbodilyinjury,propertydamage,andproducts-completedoperations;automobileliabilitywhereapplicable;workerscompensation.Additionally,serviceprovidersmayberequiredtoincludeerrorsandomissionscoverage.3.08.090.2Theminimumamountofinsuranceshallbe$2,000,000peroccurrenceand$4,000,000intheaggregate.TheGeneralManagershallconsultwiththeinsurancebrokerofrecordand/oranindependentriskmanagerforadviceontheinsurancerequirementsforcontractsthatexceed$10,000,orthatposeriskthat,inthejudgmentoftheGeneralManager,warrantmorethantheminimuminsurance.3.08.090.3TheGeneralManagershall,afterconsultingwiththeinsurancebrokerofrecordand/oranindependentriskmanager,specifyinsurancerequirementsincontractshe/sheisauthorizedtolet;or,inthecaseofcontractsthatmustbeletbyBoardaction,theGeneralManagershall,afterconsultingwiththeinsurancebrokerofrecordand/oranindependentTitle3Page24 riskmanager,recommendinsurancerequirementstotheBoardofDirectors.3.08.100ProcurementAuthorizationDuringanEmergency3.08.100.1Anemergency”isasituationwhichposesanimmediaterisktohealth,life,propertyorenvironment.Mostemergenciesrequireurgentinterventiontopreventworseningofthesituation.ItistheGeneralManager’sresponsibilitytotakeimmediateactiontoprotectemployees,customersandDistrictpropertyduringanemergency.3.08.100.2Duringanemergency,theGeneralManagerisauthorizedtorepairorreplaceapublicfacility,takeanydirectlyrelatedandimmediateactionrequiredbythatemergency,andprocurethenecessaryequipment,services,andsuppliesforthosepurposes,withoutimmediateBoardapprovalandwithoutgivingnoticeforbidstoletcontracts.3.08.100.3TheGeneralManagerwillreporttotheBoardofDirectorswithin48hoursanyandallactionstakentodealwiththeemergency.3.08.100.4IftheGeneralManagertakesanyactiontomanagetheemergencythatwouldotherwiserequirecompetitivebidding,theBoardshallinitiallyreviewtheemergencyactiontakennotlaterthansevendaysaftertheactionor,atitsnextregularlyscheduledmeetingifthatmeetingwilloccurnotlaterthan14daysaftertheaction,andatleastateveryregularlyscheduledmeetingthereafteruntiltheactionisterminated,todetermine,byafour-fifthsvote,thatthereisaneedtocontinuetheaction,unlesstheGeneralManagerhasterminatedthatactionpriortotheBoardreviewingthestatusoftheemergency.3.08.100.5ItistheDistrict’sintenttocomplywithallsectionsofthePublicContractCodeSection22050inmanagingemergencysituations.CHAPTER3.10CAPITALIZATIONPOLICYSections:3.10.010Procedures3.10.020Capitalizationrequirements3.10MbProceduresshallbefollowedindeterminingwhichpurchasesshouldbecapitalizedorexpensedintheyearpurchasedinaccordancewithgenerallyacceptedaccountingpractices.3.10.020Thefollowingcriteriashallbeusedtodeterminethecapitalizationofanasset:1.Thenormalusefullifeoftheitemisatleasttwoyearsfromdateofpurchase.2.Theitemhasanacquisitioncost(includingfreightandinstallation)ofatleastthe$10000.hue3Page25 3,Theitemwillnotbesubstantiallyreducedinvaluebyimmediateuse.4.Incaseofrepair,theoutlaywillsubstantiallyprolongthelifeofanexistingfixedassetorincreaseitsproductivitysignificantly,ratherthanmerelyreturningtheassettoafunctioningunitormakingrepairsofaroutinenature.5.Landpurchasesandlandrightsmustalwaysbecapitalizedregardlessofcost.CHAPTER3.12ACCOUNTSRECEIVABLESections:3.12.010MiscellaneousAccountBillings3.12.020DelinquentAccountsReceivable3.12.010MiscellaneousAccountBillingsAmiscellaneousaccountisabillrenderedbytheDistricttoapartytowhomtheDistricthasrenderedaserviceorprovidedagoodforwhichtheDistrictchargesafeebutshallnotbeanyserviceorgoodwhichisbilledtoacustomeroftheDistrictthroughthenormalmonthlyutilitybillingsystem.ItisthepolicyoftheDistricttoprotecttheassetsoftheDistrictbypromptlyissuingbillsforgoodsorservicesrendered,andbyfollowingwellestablishedfollow-upprocedurestoinsurethatbillsarepaidinatimelymanner.3.12.010.1Thispolicyshallapplytothebillingandcollectionofmiscellaneousaccounts.3.12.010.2WhenanyDepartmentoftheDistrictnotifiestheAdministrativeServicesDepartmentthatabillableserviceorgoodhasbeenprovided,theAdministrativeServicesDepartmentshallpromptlyrenderabilltotheappropriateparty.Themiscellaneousaccountbillisdueandpayable30daysafterthebillingdate.3.12.010.3Ifthebillremainsunpaidafter30days,thebillshallbeconsidereddelinquentandshallbeassessedalatechargeinaccordancewithcurrentDistrictpolicy,andasecondrequestforpaymentshallbepromptlymailed.3.12.010.4Ifthebillremainsunpaidafter60days,theGeneralManagershallcausecollectionproceedingstocommence,whichmayincludeinitiationofactionatSmallClaimsCourt,3.12.010.5TheGeneralManagerisauthorizedtoactwithinhis/herdiscretiontoalterthetimeperiodssetforthinthispolicywhenamiscellaneousaccountcustomeriscooperatingwiththeDistrictinresolvinganunpaidbill.3.12.020DelinquentAccountsReceivableAttheendofJuneandDecemberofeachyear,theDistrictTreasurerwillhaveidentifiedalldelinquentaccountsreceivableonclosedaccountsthatareconsidereduncollectiblethatexistontheDistrict’srecordsforsixmonthsormore.Anycustomerwhoismakingpaymentsonhis/herdelinquentaccountwillnotbeaddedtothedelinquentaccountlistuntilthecustomerstopsmakingagreeduponpayments.T,de3Pae26 3.12.020.1TheDistrictTreasurerisauthorizedtowriteoffdelinquentaccountsupto1/6%oftheannualamountsbilledfromtheDistrict’saccountsreceivablebalance.3.12.020.2TheDistrictTreasurerwillincludeinthemonthlyTreasurer’sReportthedetailsoftheaccountswrittenoffincludingthecustomernamesandthedollaramountsbeingwrittenoff.3.12.020.3Shoulddelinquentaccountsexceedtheauthorizedlimit(1/6%oftheannualamountsbilledfromtheDistrict’saccountsreceivablebalance),therequestforapprovaltowriteoffsuchaccountsshallcomebeforetheBoardofDirectorsforconsideration.CHAPTER3.16ACCOUNTSPAYABLESections:3.16.010Pre-authorizedDisbursements3.16.020BillsforBoardApproval3.16.030AccountsPayable3.16.010Pre-authorizedDisbursements3.16.010.1TheDistrictTreasurershallbeempoweredtoissuechecks,withauthorizationfromtheapprovingauthority,withoutpriorBoardapprovalforthefollowingitems:3.16.010.1(A)Consumerdeposits-depositrefundswithinterest;reductionofdeposits.3.16.010.1(B)Refunds-creditbalances,overpayments,refundofconnection,facilitiesfeesandtapfeeswherethecustomerhasdecidednottobuildandtheDistrictstaffhasnotincurredanyexpenseandlineextensionrefunds.3.16.010.1(C)Contracts-maintenancecontractsonDistrictequipment;paymentsonleasedequipmentandland;paymentsoncontractsforsoftwaresupportservices;paymentsforcontractsissuedpursuanttoSection3.06.040ofthispolicyincludingcontractsforconsultingandconstructionservices.3.16.010.1(0)DistrictBoardofDirectors-monthlycompensation.3.16.010.1(Ef—Distriet)Districtcreditcardpayments.Intheeventadisputeoccurs,thesettlementwillbehandledbythepartiesinvolved.3.16.010.1(F)EmployeebenefitspreviouslyapprovedbytheBoardincluding:deferredcompensationdeposit;pensionpayments(401a,467andCaIPERS);visionreimbursementsandanyotherpaymentorreimbursementpursuanttotheDistrict’sagreementwiththeInternationalBrotherhoodofElectricalWorkers,Local1245andT,tle3Page27 employeebenefitsauthorizedintheDistrict’sCode4Personnelformanagement/exemptemployees.3.16.010.1(G)Expensechecks-advancesformeetings,seminars,conferences,etc.,forstaff,GeneralManagerandBoardofDirectors.ReimbursementformileageandapprovedoutofpocketexpensesinaccordancewiththeDistrictsTitle4expensereimbursementpolicy.3.16.010.1(H)Insurance-life,health,disabilityanddentalpremiums.3.16.010.1Q)Payroll-employeechecks,payrolltransfers,meals,uniondues,employeesavingsdeductions,workerscompensationinsurance,payrolltaxwithholding,employertaxesandanyotheremployerpayrollobligations.3.16.010.1(K)Postage-Postageincludingstamps,trustfund,postagemeterandbulkmailingpermitdeposits.3.16.010.1(L)RepaymentofinternalloansapprovedbytheBoard(journalentryonly;noactualcheck).3.16.010.1(M)Loans-RepaymentofloansthathavebeenapprovedbytheBoardofDirectors.Wherepracticable,thepaymentwilLbewillbesentbyACHorwiretransfertothelendinginstitutiononorbeforethepaymentduedate.3.16.010.1(N)StateBoardofEqualization-salestax,usetaxandenergysurchargescollected.3.16.010.1(0)Wholesalepowerexpensesincluding,butnotlimitedto,theNorthernCaliforniaPowerAgency,theDistrict’scurrentBoardapprovedwholesalepowersupplierandSierraPacificPowerCompany.PaymentsmaybebyACHorwiretransfertothebankaccountnumberprovidedbythevendor.3.16.010.1(P)Biditems-wheretheBoardhasauthorizedabidpurchaseandtheinvoiceexcludingsalestaxandshippingchargesislessthanorequaltotheauthorizedcontract.AmountsbilledabovethebidamountmustbeapprovedbytheGeneralManagerortheBoard.3.16.010.1(0)Monthlyandannualbuildingutilityexpensesfortelephone,garbage,heating,sewercollectionandtreatment(USAandTSD),cable,Internetandutilitybillspaidtootheragenciessuchaselectricutilitybillsforpumpstationsandwells.3.16.010.1(R)ItemsapprovedbytheBoard:AnyitemsthathavebeenapprovedbytheBoardatascheduledboardmeeting(e.g.propertyandliabilityinsurancerenewal).3.16.010.1(S)TheGeneralManagermayapprovepaymentsrequiredinanunpredictedemergencysituationwithsubsequentnotificationtotheBoard.3.16.010.2UpondirectionoftheGeneralManagerandreceiptofanappropriate,signedauthorizationinaccordancewithSection3.08.010ofthispolicy,theDistrictTreasurershallTitIo3Page2B beempoweredtoissuechecksupto$15,000and,ininstanceswheretheBoardofDirectorshasissuedauthorizationforanexpenditureof$15,000orgreater.3.16.010.3AllchecksissuedinanyoftheabovecategorieswillappearintheaccountspayablecheckregisterprovidedinthemonthlyTreasurer’sReporttotheBoardofDirectorsforapproval.SupportingdocumentswillalsobeavailableforBoardreviewintheAdministrativeServicesDepartment.3.16.020BillsforBoardApprovalBillswhichmaybecontroversialshouldbelistedasaspecialagendaitemaccompaniedwiththeGeneralManagerrecommendation.3.16.030AccountsPayable3.16.030.1UponpresentationofinvoicesforgoodsandservicesandotherfinancialobligationsoftheDistrictintheformatprescribedinTitle3,Chapter3.08,Purchasing,totheAdministrativeServiceDepartment,theTreasurershallbeauthorizedtoissuepaymentforsuchinvoices3.16.030.2AllpaymentsforDistrictfinancialobligationsshallbeprocessedthroughtheDistrict’scomputerizedaccountspayableprogram.Priortoissuingchecks,theDistrict’sAccountsPayableClerkwillverifytheentriesforaccuracyincludingverifyingthatthecorrectvendorhasbeenkeyedintothesystem;thattheamountofchargesarecorrectandthatthetotaloftheinvoiceiscorrect;thatthesalesandusetaxhasbeencalculatedcorrectly;thattheappropriateauthorizationappearsontheinvoice;thatthecorrectworkordernumberandaccountnumberoraccountnumberandactivitycodehavebeenassignedtothecharges;andthatthecorrectsupportingdocumentsareattachedtotheinvoice.TheAccountsPayableClerkwillalsoverifythatinvoicesgreaterthan$10,000havebeenapprovedbytheGeneralManagerandthatinvoices$15,000andgreaterhaveaBoardauthorizedMinuteOrderattachedshowingtheamountoftheapprovedexpenditureorpriorBoardauthorizationforregularDistrictexpendituresaslistedinTitle3,Chapter3.16.010,Pre-authorizedDisbursements.3.16.030.3Afterverifyingthattheaboveitemsareinorder,theAccountsPayableClerkwillrunthechecksforpaymentandprintacheckregisterlistingthenumberofeachcheckissued,thevendorpaid,theamountofthechargesandtheamountofthetotalcheck.InorderfortheAccountsPayableClerktoprintchecks,theTreasurerwillalsohavetologontotheDistrict’scomputerizedcheckprintingandbankingsoftwareandkeyinhis/herconfidentialpassword.3.16.030.4Beforeanypayments,ACHtransfersorwiretransfersarereleased,theTreasurerwillthenverifythattheaccountspayablecheckregisterandtheindividualinveiees—matGhinvoicesmatch,thattheinvoiceshavebeenproperlyprocessedandthattheexpenditureshavebeenmadeinaccordancewiththeDistrict’spurchasingprocedures.TheTreasurerthenauthorizesthepayment,ACHorwiretransferoffundsusingasecureprogramlinkedtotheDistrict’sbankaccount.3.16.030.6Intheeventthatamanualcheckneedstobeissuedoutsideoftheautomatedcheckrunprocess,thecheckwillrequiretwosignatures.ThetwosignaturescanbeanytwoBoardauthorizedcheckingaccountsignatures.Th1e3Page29 3.16.030.7TheTreasurershallprovidereportstotheBoard.3.16.030.7(A)AtthefirstregularmeetingaftertheendofeachmonthheldbytheBoardofDirectors,theBoardwillbepresentedwith3.16.030.7(A)(1)Anaccountspayablecheckregistershowingallofthechecksissuedfortheaccountingperiodbeingpresented;aninvestmentreportshowingthestatusoftheDistrictrestrictedfunds;andafundstatusreportshowingthelocationofallDistrictfundsandtheamountondepositateachfinancialinstitutionororganization.3.16.030.7(B)ThedetailsofallchecksissuedandinvoicespaidshallbeavailableforreviewbyanyDirectorintheAdministrativeServicesDepartment.TheBoardshallofficiallyauthorizepaymentofalldisbursementsthathavebeenmadebytheTreasurerandpresentedontheaccountspayablecheckregisterataboardmeeting,monthly.3.16.030.7(C)TheTreasurershalllistontheagendaanyinvoiceforpurchasesthathavenotbeenmadeinaccordancewiththeDistrict’spurchasingpoliciesassetforthinTitle3,Chapter3.08Purchasing.3.16.030.7(D)Statementofthegeneralfundshowingthebeginningcheckingaccountbalance,thecategoriesofcashreceivedbytheDistrictduringthemonth,asummarylistofthecashdisbursementsmadeduringthemonth,anyauthorizedtransfersinoroutofthegeneralfundandtheendingbalanceattheendofthemonth.3.16.030.7(E)Semi-annualbudgetreportsshowingthestatusofbudgetedexpenditurescomparedtoactualexpenditureswillbepresentedataboardworkshopafterthecloseoftheJuneandDecemberfinancialrecords.3.16.030.7(F)Semi-annualfinancialstatementsshowingthestatusofallrevenuesandexpendituresintheformatoffinancialstatementsusinggenerallyacceptedaccountingprinciplesforutilitiesafterthecloseoftheJuneandDecemberfinancialrecords.CHAPTER3.20INVESTMENTSSections:3.20.005LocalAgencyInvestmentFundInvestments3.20.008FundTransfers3.20.010InvestmentofSurplusFunds3.20M12InvestmentPolicy3.20.005LocalAgencyInvestmentFundInvestmentsTitle3Page30 3.20.005.1AuthorizationhasbeengivenforthedepositandwithdrawalofmoniesintheLocalAgencyInvestmentFund(LAIF)intheSlateTreasuryinaccordancewiththeprovisionsofSection16429.1oftheGovernmentCodeforthepurposeofinvestmentasstatedtherein.3.20.005.2AnytwoofthefollowingofficersoremployeesoftheDistrict,thePresidentoftheBoard,theGeneralManagerortheTreasurer,mayexecutedocumentstoaddordeleteDistrictaccountsandauthorizedpersonstomaketransferstoandfromthoseaccountswiththeLAIF.3,20.008FundTransfers3.20.008.1TheBoardapprovedcommercialbank(Bank)isrequestedtohonor,executeandprocesstheDistrictstelephonic,electronic,writtenororalrequestsforthetransferoffundsbetweentheaccountsoftheDistrictatBankandtheLocalAgencyInvestmentFund,subjecttosuchtermsandconditionsasmayfromtimetotimebeagreeduponbytheDistrict.3.20.008.2AnyoneofthefollowinglistedofficersoremployeesoftheDistrict,thePresidentoftheBoard,theGeneralManagerortheTreasurerareherebyauthorized,directedandempoweredforandonbehalfofandinthenameoftheDistrictasfollows:3.20.008.2(A)ToexecuteagreementswiththeBankprovidingforsuchfundstransfersandtomakeandverifyrequestsforsuchtransfers,andtheBankshallbeentitledtohonorandchargethisDistrictforallsuchrequests,whengiven(orpurportedtobegiven)byanyoneoftheabove.3.20.008.2(B)Tomake,executeanddeliversuchotheragreementsasmayberequiredbytheBank;and3.20.008.2(C)ToperformorcausetobeperformedallfurtheractsandexecuteanddeliverallfurtherinstrumentswhichBankmaydeemnecessarytocarryoutthepurposesofthispolicy.3.20.008.3TheDistrictherebyratifiesandconfirmstheactsofitsofficers,agentsoremployeesinheretoforerequestingtransfersoffundsfromthisDistrict’saccountswiththeBankbywireorcomparabletransfertogetherwithanyactsperformedinrelationhereto.3.20.008.4ThattheClerkoftheDistrictisherebyauthorizedanddirectedtoexecute,acknowledgeanddeliveracertifiedcopyoftheResolutionrelatedheretototheBankandanyotherpersonoragencywhichmayrequirecopies,andthatthecertificationofthe(Secretary)ClerkastothesignaturesoftheabovenamedofficerswillbebindingonthisDistrict.3.20.008.5ThattheBankisauthorizedtoactuponthispolicyuntilwrittennoticeoftherevocationthereofbyaresolutiondulyadoptedbytheBoardofDirectorsofthisDistrictisdeliveredtotheBank,suchrevocationisinnowaytoaffecttheobligationsofthisDistricttotheBankincurredpursuanttothetermsofthispolicypriortoreceiptbytheBankofsuchnoticeorrevocation.fltle3Pageal 3.20.010InvestmentofSurplusFundsTheDistrictTreasurershallinvestsurplusfunds,bothrestrictedandgeneral,pursuanttotheDistrict’sInvestmentPolicy(DistrictCode3.20.12).AregularaccountingofallfundactivitiesshallbepresentedtotheBoardofDirectorsinthemonthlyTreasurersReport.3.20.012InvestmentPolicy3.20.012.1InvestmentAuthorityInaccordancewithSection53600etseq.oftheGovernmentCodeoftheStateofCalifornia,theauthoritytoinvestpublicfundsisexpresslydelegatedtotheBoardofDirectorsforsubsequentdelegationtotheTreasurer.TheTreasureroftheDistrictreceivesdirectionandauthoritytoinvestanyandallDistrictfundsfromtheBoardofDirectorsoftheDistrict.3.20.012.2StatementciObiectives-PerDbjeclivesPersection53600.5oftheCaliforniaGovernmentCode,theprimaryobjectiveoftheTreasurershallbetosafeguardtheprincipalofthefundsunderhis/hercontrolwheninvestingpublicfunds.Thesecondaryobjectiveshallbetomeetallliquidityrequirementsandthethirdobjectiveshallbetoachieveanacceptablereturnonthefundsunderhis/hercontrol.Inorderofpriority,threefundamentalcriteriashallbefollowedintheinvestmentprogram:1.Safety-Safetyofprincipalistheforemostobjectiveoftheinvestmentprogram.Investmentsshallbeundertakeninamannerthatseekstoensurethepreservationofcapitalintheoverallportfolio.Theobjectivewillbetomitigatecreditriskandinterestraterisk.a)CreditRisk:TheDistrictwillminimizecreditrisk,theriskoflossduetothefailureofthesecurityissuerorbacker,by:i.Limitinginvestmentstothesafesttypesofsecurities.ii.Pre-qualifyingthefinancialinstitutions,broker/dealers,intermediariesandadviserswithwhichtheDistrictwilldobusiness(custodialrisk).iii.Diversifyingtheinvestmentportfoliosothatpotentiallossesonindividualsecuritieswillbeminimized(concentrationofrisk).b)InterestRateRisk:TheDistrictwillminimizetheriskthatthemarketvalueofsecuritiesintheportfoliowillfallduetochangesingeneralinterestrates,by:i.Structuringtheinvestmentportfoliosothatsecuritiesmaturetomeetcashrequirementsforongoingoperations,therebyavoidingtheneedtosellsecuritiesontheopenmarketpriortomaturity.ii.Investingoperatingfundsprimarilyinshorter-termsecurities,moneymarketmutualfunds,orsimilarinvestmentpools.2.Liquidity—InanefforttoensurethattheDistrict’sportfoliowillbesufficientlyliquidtomeetcurrentandanticipatedoperatingrequirements,periodiccashflowanalysiswillfldeaPae32 beperformed.Investmentsshallbemadesothatthematuritydateiscompatiblewithcashflowneedsandsafetyofprincipal.3.Yield—Investmentsshallbeundertakentoproduceanacceptablerateofreturnafterfirstconsideringsafetyofprincipalandliquidityandtheprudentinvestorstandard.InvestmentStrategy—TheportfoliowillbemanagedtomeettheDistrict’scashflowneeds.Themaximummaturityofanysecuritywillnotexceed5yearsexceptasspecificallynotedbelow.AllinvestmentactivityshallbeconsistentwithprudentinvestorstandardandinaccordancewiththeauthorizedinvestmentsincludedunderDistrictCode3.20.012.5.3.20.012.3PrudentInvestorStandardAsapplicabletotheDistrict,theprudentinvestorstandardisastandardofconductwherebyanypersonauthorizedtomakeinvestmentdecisionsonbehalfoftheDistrictactswithcare,skill,prudenceanddiligenceunderthecircumstancesthenprevailing,includingbutnotlimitedto,thegeneraleconomicconditionsandtheanticipatedneedsoftheDistrict,thataprudentpersonactinginlikecapacityandfamiliaritywiththosematterswoulduseintheconductoffundsofalikecharacterandwithlikeaims,tosafeguardtheprincipalandmeettheliquidityneedsoftheDistrict.3.20.012.4PortfolioAnyPortfolioAnyreferencetotheportfolioshallmeanthetotaloftheDistrict’scashandsecuritiesundermanagementbytheTreasurer.ExceptforcashincertainBoarddesignated,restrictedandspecialfunds,theDistrictwillconsolidatecashandreservebalancesfromallfundstomaximizeinvestmentearningsandtoincreaseefficiencieswithregardtoinvestmentpricing,safekeeping,andadministration.Investmentincomewillbeallocatedtothevariousfundsoraccountsbasedontheirrespectiveparticipationandinaccordancewithgenerallyacceptedaccountingprinciples.TheTreasurermayinvestinanysecurityauthorizedforinvestmentundertheCaliforniaGovernmentCode,subjecttothelimitationsdescribedherein:1.MaturityLimitations—a)Theaggregatematurityofthetotalportfoliomustnotexceedfive(5)yearsforthegeneraloperatingfundsoftheDistrict.b)Fundswhichrepresentdebtservicereservefundsmaybeinvesteduptoatermoftenyears,aslongastheperiodinvesteddoesnotexceedthetermofthedebtrepayment.c)InvestmentsofrestrictedfundsheldfortheDonnerLakeAssessmentDistrictthatarenotexpectedtobeneededtopaydebtserviceontheSRFloanmaybeinvesteduptothetermoftheSRFloan.d)Constructionfundsmaybeinvestedtomatureonorbeforethedatefundsareexpectedtobeneededforconstructionpurposes.2.InvestmentTransactions—thepurchaseofanyinvestmentotherthanthosepurchaseddirectlyfromtheissuershallbe,totheextentpossible,fromafirmdesignatedasaPrimaryDealerbytheFederalReserveofNewYork.TLtIe3Pago33 3.SaleofSecurities—Securitiesmaybesoldtoprovideneededliquidity,torestructuretheportfoliotoreduceriskortoincreasetheexpectedreturnoftheportfolio.Innoinstanceshallasaleofsecuritiesbeusedforspeculativepurposes.AllsalesaretobereportedtotheBoardonamonthlybasis.4.ProhibitedInvestments—Prohibitedinvestmentsincludeinversefloaters,rangenotesinterestonlystripsderivedfromapoolofmortgages(CollateralizedMortgageObligations),andanysecuritythatcouldresultinzerointerestaccrualifheldtomaturity.(Zerointerestaccrualmeansthesecurityhasthepotentialtorealizezeroearningsdependinguponthestructureofthesecurity.Zerocouponbondsandsimilarinvestmentsthatstartbelowthefacevaluearelegalbecausetheirvaluedoesincrease.)5.Safekeepinga)AllsecuritiestransactionsenteredintobytheDistrictshallbeconductedonadeliveryversuspayment(DVP)basis.b)SecuritiesshallbeheldbyanindependentcustodiandesignatedbytheTreasurerandheldinsafekeepingpursuanttoasafekeepingagreement.c)AllfinancialinstitutionswhichprovidesafekeepingservicesfortheDistrictshallberequiredtoprovidereportsorsafekeepingreceiptsdirectlytotheTreasurertoverifysecuritiestakenintotheirpossession.3.20.012.5AuthorizedInvestments1.TheDistrict’sauthorizedcommercialbankinaninterestbearingcheckingorsavingsaccount.TheTreasurerisauthorizedtomakedailydepositsandwithdrawalsforpurposesofthesafekeepingofDistrictmoniesandpaymentsofDistrictfinancialobligations.2.LocalAgencyInvestmentFund(LAIF)DepositsforthepurposeofinvestmentintheLocalAgencyInvestmentFundoftheStateofCaliforniaTreasurymaybemadeuptothemaximumamountpermittedbyStateTreasurypolicy.AnyLAWinvestmentsmadebytheDistrictshallbeconsideredtobeshort-terminnatureeveniftheLAIFhasinvestedinindividuallonger-termsecurities.TheTreasurerisauthorizedtomakeregulartransferstoandfromLAIFuptothelimitoftransactionsestablishedbytheLAIFinvestmentpolicyforpurposesofmeetingtheDistrict’sdailycashflowneedsandearninginterestonsurplusfunds.3.AnyotherinvestmentsauthorizedandlistedintheGovernmentCodeSections53600-53609,TheTreasurerwillconsultwiththeBoardofDirectorswhenrecommendinganyoftheinvestmentswithinthesesectionsotherthansubsections1and2above.Fromtimetotime,theBoardmayalsoconsultwithaninvestmentprofessionalpursuanttoTitle3.20.012.2Section1a)iLEachinvestmentwillbespecificallyauthorizedbytheBoardofDirectors.4.BondproceedsandreservefundswillbeinvestedonlyinpermittedinvestmentsorauthorizedinvestmentsdefinedintheTrustAgreementforeachparticularfinancingwhichhaspreviouslybeenapprovedbytheBoardofDirectors(GovernmentCodeSection53601I).TheTreasurerwillconsultwiththeFinancialAdvisororTrusteeonT,flesPagea4 thefinancingforinvestmentrecommendationstosubmittotheBoardofDirectorsforapproval.TheTreasurerisauthorizedtoinvestfundsinamoneymarketfundorLAIFwiththeTrusteependinginvestmentofthosefundsinalonger-terminvestment,whichwillbeapprovedbytheBoardofDirectors.3.20.012.6ReportinginRepohinginaccordancewithSection63646oftheCaliforniaGovernmentCode,theTreasurershallsubmitaquarterlyreporttotheBoardofDirectorswithin30daysfollowingtheendofthequartercoveredbythereport.Thereportshallincludeinvestmentactivity,includingyieldandearnings,andthestatusofcashbydepository.3.20.012.7InternalControlsAnnually,theDistrictwillhaveanindependentauditbyanexternalauditor.Thisauditwillprovideinternalcontrolbyassuringcompliancewithpoliciesandprocedures.3.20.012.9AnnualReviewofInvestmentPolicyTheInvestmentPolicyshallbesubmittedatleastannuallytotheBoardofDirectorsforadoption.Thepolicyshallbereviewedannuallytoensureitsconsistencywiththeoverallobjectivesofpreservationofprincipal,liquidity,yieldanditsrelevancetocurrentlawandfinancialandeconomictrends.Thereviewwillalsoincludethereviewofthediversificationoftheinvestmentsintheportfolioandthecustodialriskoftheportfolio.AnymodificationsmadetheretomustbeapprovedbytheBoardofDirectors.CHAPTER3.24RESTRICTEDFUNDSSections:3.24.010RestrictedFunds3.24.010.1TheBoardofDirectorswilldirectstalfwhenmoniescollectedbytheDistrictaretobeconsideredasrestrictedfunds.3.24.010.1(A)BoardDesignatedRestrictedFundsarethosefundsrestrictedbyBoardactionandwhichtheBoardcanchangethepurposeofthedesignationatanytime.3.24.010.1(B)RestrictedFundsarethosefundsthatarerestrictedbycontractoragreementwiththeDistrictsuchasaloanreservefund.3.24.010.2RestrictedfundswillbeinvestedpursuanttotheDistrict’sinvestmentpolicyasdescribedinChapter3.20,Investments.Title3Page35 3.24.010.3AllinterestearneduponsaidrestrictedfundsshalladoptacharacterofandbecomepartofthespecificrestrictedaccountunlessotherwisedirectedbytheBoardofDirectors.Inthecaseofloanreservefundswhosebalancesaregreaterthanthereserverequirement,thesurplusfundsmaybeusedtooffsettheprincipalandinterestpaymentsontheloan.3.24.010.4ExpendituresfromrestrictedfundsshallbeauthorizedbytheBoardofDirectors.Fromtimetotime,theBoardmaypre-approvetransfersfromrestrictedfundsinadvancethatpertaintospecificprojectsoractivities.3.24.010.5TheDistrict’sTreasurerwillincludeamonthlyreportontheactivityoftherestrictedfundsaccountsalongwiththemonthlyTreasurer’sReport.CHAPTER3.32STANDBYCHARGESANDASSESSMENTDISTRICTSSections:3.32.010CollectionofDelinquentAssessments3.32.020StandbyCharges3.32.010CollectionsofDelinquentAssessments—TheAssessmentsThefollowingprocedureistobeusedbytheDistrictstaffinconnectionwiththecollectionofdelinquentassessments,AssessmentsaredueonNovemberfirstandFebruaryfirstofeachyear,andaredelinquentafterDecembertenthandApriltenth,respectively.FollowingistheproceduretheDistricthasadoptedforcollectingdelinquentassessmentpayments:3.32.010.1ByJanuarythirty-firstandMaythirty-firstofeachyearorassoonasthecountyrecordsareavailable,theDistrictTreasurerwillcontacttheCountyTaxCollector’sOfficeanddeterminewhetheranyassessmentsaredelinquentand,ifso,theamountofanysuchdelinquency.TheDistrictTreasurerwillthenimmediatelysendacollectionletter,requestingpaymentwithinfifteendays.3.32.010.2Ifnotpaidwithinfifteendaysofthecollectionletter,theDistrictTreasurerwillsend,bycertifiedmail,ademandletter.Thisletterwilldemandpaymentwithintendays,andwillindicatethat,ifnotpaid,thematterwillbereferredtoDistrictForeclosureCounselforinitiationofforeclosureproceedingsagainstthedelinquentparcel.AlistofdelinquentparcelswillbepresentedtotheBoardforauthorizationtoproceedwiththeforeclosureprocess.3.32.010.3TheBoardmayauthorizeathirdpartycompanywhospecializesinperformingserviceslistedinsection3.32.010.1and3.32.010.2toworkwiththeDistrictstafftobillandcollectassessmentmoniesdue.3.32.010.4TheBoardmayauthorizetheuseofforeclosurecounseltoproceedwiththeY,tIe3Page36 foreclosureprocesspursuanttoCaliforniaStatelawandtherequirementsofanydebtinstrumentswherethedebtissecuredbyassessmentpayments.StaffwillkeeptheBoardinformedthroughouttheforeclosureprocess.3.32.010.5TheCountyrequirestheDistricttoremovedelinquentCommunitiesFacilitiesDistrictparcelsfromtheCountytaxrollonoraboutJune30thofeachCountyfiscalyear.TheDistrictTreasurerwillauthorizetheCountytoremovethedelinquentparcelsfromtheCountytaxrollbeforereferringdelinquentparcelstoforeclosurecounsel.RemovalofadelinquentparcelfromtheCountytaxrolldoesnotreleasepropertyownersfromtheirpaymentobligations.3.32.010.5Alldelinquentassessmentpaymentswillberequiredtoincludeanylatefees,legalfeesand/oradministrativechargesallowedtobecollectedunderCaliforniaStatelaw.3.32.010.6IncaseswhereassessmentsarecollectedontheNevadaorPlacerCountytaxbillsandwheretheCountiesreimbursetheDistrictfor100%oftheamountassessed,Districtstaffmaysendcollectionanddemandlettersondelinquentassessmentsbutwillnotproceedtotheforeclosureprocess.TheforeclosureprocesswillbeprocessedbyNevadaandPlacerCountiespursuanttoCountyandCaliforniaStatelaw.3.32.020.1StandbyChargesAnnuallyChargesAnnually,theBoardofDirectorswillauthorizebyresolutionthecontinuanceofandtheamountofchargesforelectricandwaterstandbycharges.Thereafter,theGeneralManagershalldirectstafftoprepareanupdatedlistofunimprovedparcelstobeassessedelectricandwaterstandbycharges.TherecordsshallbepreparedinaformatacceptabletobothNevadaandPlacerCountiesandshallbesubmittedtothembeforetheirscheduleddeadline.TheassessmentswillthenappearontheannualpropertytaxbillssentoutbyNevadaandPlacerCounties.NevadaandPlacerCountieswillthenactasthecollectionagentsfortheassessmentsandwillfoTwardpaymenttotheDistrictpursuanttocountypolicy.Res,2010-09(6/2/10),Res.2011-02(4/6/Il),Res2014-07(5/21/14)TitoFags37 rResolutionNo.2018-20hRUCKEEDONNERPublicUtilityDistrictTITLE3ADOPTINGAMENDMENTSTOTHEDISTRICTCODEWHEREAS,theBoardofDirectorsofTruckeeDonnerPublicUtilityDistricthaschosentoamendtheDistrictWHEREAS,theDistrictCodeprovidesrulesandregulationsintendedtoconveyacomprehensivedescriptionofthemannerinwhichtheDistrictoperates,handlesitsfinancesandperformsitsaccounting;andWHEREAS,SenateBill1029becameeffectiveJanuary1,2017increasingcompliancerequirementsforWHEREAS,aworkshoponthenewlawandnecessaryrevisionstoDistrictCode,Title3washeldattheAugust2,2018Boardmeeting;NOW,ThEREFORE,THEBOARDOFDIRECTORSOFTHETRUCKEE-DONNERPUBLICUTILITIESSection1.AllpreviouslyadoptedresolutionandordinancesrelatedtoDistrictCodeTitles3areherebyrescinded;andSection2.thattheBoarddoesherebyadopttheamendedDistrictCode,Title3;andSection3.thatthisresolutionshallremainineffectuntilsupersededbyanotherresolutionamendingDistrictCodeTitle3.PASSEDANDADOPTEDbytheBoardofDirectorsatameetingdulycalledandheldwithintheDistrictonCodeTitle3;andissuersofpublicdebt;andDISTRICTDOESRESOLVEASFOLLOWS:thefifthdayofSeptember,2018bythefollowingrollcallvote:AYES:NOES:ABSENT:TRUCKEEDONNERPUBLICUTILITYDISTRICTByTonyLaliotis,PresidentATTEST:ShannaD.Kuhlemier,CMC,DistrictClerk