Staff Reports - East Bay Municipal Utility District

Board of Directors
Finance/Administration Committee
Minutes of February 26, 2013
March 7, 2013
Page 2
Semi-Annual Internal Audit Report. Internal Auditor Supervisor Barry N. Gardin presented a
status update on the FY 13 Audit Plan. He said during this reporting period four of the nine audits
identified in the plan have been initiated, completed and/or reported: Customer Assistance
Program (completed), contract administration (in progress), water consumption recognition (in
progress) and utilization of stand by pay (in progress). He reported that the audits found no
material weaknesses in District operations, no irregularities in reporting and no need for
significant adjustments. The Committee raised no questions on the audit plan.
Private Sewer Lateral Incentive Program Update. Inflow/Infiltration Program Manager
Jacqueline T. Kepke presented an update on EBMUD's efforts to incentivize the repair or
replacement of private sewer laterals (PSLs) in its service area. She reported that in 2011 the District
began pilot-testing programs to determine the most effective and efficient means to use PSL
incentive program funds. Early pilot phases, where the District provided a rebate and the property
owners were required to secure their own contractors, yielded lower than expected rates of
participation. It was determined that the level of effort required of property owners greatly impacted
participation. Ms. Kepke described a new pilot that will test the property owner participation rates
when EBMUD directly contracts with qualified contractors for PSL inspection, repair and
replacement. An agreement with contractors to complete the PSL relacement work in a selected
project area that Oakland has identified as having had high inflow and infiltration rates is scheduled
for Board consideration at its Regular Meeting of February 26, 2013. Participation rates and the pros
and cons of this new approach will be evaluated as part of a comprehensive review of the pilot tests.
Staff will continue to keep the Board apprised of progress on the PSL Incentive Program. The pilot
project is anticipated to continue through 2013, at which time staff will propose a long-term program
framework for Board consideration.
Adjournment. Director William B. Patterson adjourned the meeting at 11:06 a.m.
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