HomeMy WebLinkAboutAgenda Packet - EVWD Board of Directors - 05/15/2019SPEC IA L BO A RD MEET IN G
May 15, 2019 at 5:30 PM
31111 Greenspot Road
Highland, C A 92346
AGE N D A
C A LL TO O RD ER
PLED G E O F A LLEG IA N C E
RO LL C A LL O F BO A RD MEMBERS
PUBLIC C O MMEN T S
Any person wishing to speak to the Board of Directors is asked to complete a Speaker
Card and submit it to the D istrict C lerk prior to the start of the meeting. Each speaker is
limited to three (3) minutes, unless waived by the Chairman of the Board. Under the State
of C alifornia Brown Act, the Board of Directors is prohibited from discussing or taking
action on any item not listed on the posted agenda. T he matter will automatically be
referred to staff for an appropriate response or action and may appear on the agenda at a
future meeting.
1.Review FY 2019-20 Revenue Projections
REPO RT S
2.General Manager/C EO
3.Legal C ounsel Report
4.Board of Directors' C omments
A D J O URN
P urs uant to G overnment C o d e S ec tio n 54954.2(a), any reques t for a d is ab ility-related modific ation or
ac commodation, inc luding auxiliary aid s o r s ervic es , that is s o ught in order to p artic ip ate in the above
agendized public meeting should be direc ted to the District C lerk at (909) 885-4900.
S P E CIAL B O AR D AG E ND A S TAF F R E P O RT
Agenda Item #1.
Meeting Date: May 15, 2019
Dis c ussion Item
To: G o verning Board Memb ers
F rom: G eneral Manager/C EO
Subject: R eview F Y 2019-20 R evenue P ro jectio ns
R E C O MME N D AT IO N:
T his item is p res ented as info rmatio n o nly.
B AC KGR O UN D / AN ALYS IS :
At a wo rks hop held o n Ap ril 17, 2019, pro gram managers and s upervisors p res ented to the Bo ard o f Direc tors
(Board) their p ro p o s ed program goals and objec tives for fisc al year (F Y) 2019-20. S taff is no w working to
d etermine the funding need ed , whic h will b e p res ented to the Bo ard at a wo rks hop o n June 12, 2019.
Before completing an o p erational s p ending p lan, staff needed to p ro ject the amo unt o f revenue and o ther funding
s o urc es that will b e available to meet program commitments. T herefore, the purp o se o f this worksho p is to
review revenue p ro jec tions for the upc o ming F Y b eginning with the rates that s upport them.
T he Bo ard will rec all that for the 2017-18 fis cal year, s taff recommended ad o p tion of a resolution making only
o ne-half o f the s c heduled phase three, tiered rate inc reas es effective on July 1, 2017, while at the s ame time,
fo regoing Meter C harge increas es that were sc heduled to bec o me effective. T his actio n s aved District ratep ayers
ap p ro ximately $1.36 millio n in b oth fis cal years 2017-18 and 2018-19.
In planning for 2019-20, s taff is rec o mmending implementation o f the last half o f the phas e three tiered rates
while again refraining from imp lementatio n of p has e three of the meter c harges. T he slight ad justment to tier
rates, comb ined with slightly more aggres s ive p ro jectio ns fo r water sales, will p ro vide an additio nal $800,000 in
revenue fo r bud get purp o s es which is need ed for p lant rehab ilitation p ro jec ts. T his recommend atio n will again
s ave cus to mers $0.63 millio n in meter c harges.
T he res ulting rates effective fo r water billing purp o s es are presented in the fo llowing tab les :
F ixed mo nthly rates (as ap p licable):
WAT E R F UN D R E VE N UE P R O J E C T IO N S
T he District will p ro vid e water servic es thro ugh ap p ro ximately 21,320 d o mes tic and irrigation c o nnectio ns in F Y
2019-20. In ad d ition, 252 c o mmerc ial fire services and 21 temp o rary hyd rant meters are connected to the
Dis tric t’s s ys tem. Water demand is es timated at 6,993,000 hund red c ubic feet of water (HC F = 748 gallons) for
F Y 2019-20. T his p ro jectio n is bas ed on a s lightly more aggressive approach than has been taken in the p as t, but
is still 3% below the average annual water c o ns umptio n o ver the las t three fis c al years . G iven that the pas t two
years have yielded ab o ve-average rainfall, whic h s ho uld have reduced water s ales , s taff is c o nfident that the
ab o ve p rojec tion will allo w s ignific ant funding for p ro gram go als and ob jectives witho ut significant ris k that
p ro jectio ns are o vers tated .
Annual water d emand projectio ns are b as ed on es timated usage in each c us tomer c las s and tier. Us age estimates
are then multip lied by tier rates in order to c alculate projec ted sales. To tal water s ales fo r F Y 2019-20 is
p ro jected to b e $15,900,000 and are allo cated as follows:
Meter Charge revenue for F Y 2019-20 is p ro jec ted to b e $8,980,000. P rojec tions for this revenue are
d etermined b as ed on the cus to mer c o unts d isc ussed ab o ve, s egregated b y meter size, and then multip lied by the
fixed monthly rates in effec t. In pas t years , meter c harges on temporary meters were not inc luded in p ro jectio ns
b ut ac counted fo r approximately $70,000 in revenue. T his year $20,000 has b een added to p ro jec tions for meter
charges o n temp o rary meters .
Other Charges & Other Revenue inc lude fees related to the c o llectio n of delinq uent ac c o unts, inves tment
revenue, reimb urs ements from o ther agenc ies , and fac ility rental and other mis c ellaneous revenue.
T he total revenue p ro jected fo r F Y 2019-20 is $1,007,000, up $103,000 from F Y 2018-19. T he inc reas e is d ue
to the ris ing interes t rates paid by the Lo cal Agenc y Investment F und whic h rose b y more than 1% to 2.55%
o ver the las t 12 months.
WAS T E WAT E R F UN D R E VE N UE P R O J E C T IO N S
T he Dis tric t p ro vides was tewater c o llectio n services to c usto mers thro ugh approximately 20,205 c onnec tions .
O f these c onnectio ns , 19,125 s erve single family res id ential units, with the remaining 1,080 cons isting of vario us
commerc ial and multi-family cus to mers . T he numb er o f was tewater c o nnec tions has not inc reas ed signific antly
o ver the las t five years .
Wastewater S ystem Charges are p ro jected at $4,648,000 fo r F Y 2019-20. T hes e revenues are the s o urc e of
fund s us ed by the District to maintain and rep lac e wastewater c o llectio n lines, p ay a portio n o f the Dis tric t’s
general and ad minis trative cos ts , and pay deb t s ervic e on wastewater b o nds .
P ro jected res id ential revenues for F Y 2019-20 were calc ulated by multiplying the s ingle family res id ential c o unt
b y the monthly flat c harge o f $15.36 for 12 mo nths to d erive estimated revenue o f $3,525,000.
C o mmerc ial c us to mer p ro jec ted revenues were calc ulated by multip lying the number o f c o mmerc ial acc o unts b y
the Dis trict’s mo nthly flat c harge of $3.90 for twelve months, and then es timating total water usage b y
commerc ial c us tomers, in HC F, and multip lying the to tal usage by the vo lumetric rate o f $0.55. C o mmercial
b illings make up $1,205,000 o f pro jected revenues.
Wastewater Treatment Charges are assess ed in ac cordance with rates s et by the C ity of S an Bernard ino
(C ity) which c urrently treats all wastewater generated by Dis tric t c usto mers . All Treatment C harges collected are
remitted to the C ity and therefore have no effec t on Distric t operatio ns . Treatment C harges and offsetting
p ayments to the C ity are estimated at $8,665,000 for F Y 2019-20.
Total F inancial R esources availab le fo r F Y 2019-20 includ e the $39,200,000 in rate revenues outlined above,
p lus up to $145,000,000 in S tate R evolving F und financ ing fo r the S terling Natural R esourc e C enter, which is
p ending final bud get ap p ro val.
At the next bud get wo rks hop on June 12, 2019, s taff will present a s p ending p lan to utilize thes e financial
res o urc es , entrus ted to the Dis trict by our s takeholders , in an effec tive and fis c ally responsible manner.
AG E N C Y G O ALS AN D OB J E C T IVE S :
G o al and O bjec tives I I - Maintain a C ommitment to S us tainab ility, Transparenc y, and Ac c o untability
a) P rac tice Trans parent and Ac countab le F is cal Management
R E VIE W B Y O T HE R S :
T his agenda item has been reviewed by the F inanc e and P ublic Affairs Dep artments .
F IS C AL IMPAC T
R ecommended b y:
Jo hn Mura
G eneral Manager/C EO
R espec tfully sub mitted:
Brian Tomp kins
C hief F inancial O ffic er
F IS C AL IMPAC T
T here is no fis cal impac t as s o c iated with this agend a item.
ATTACH M E N TS:
Description Type
P resentation P resentation
FY 2019-20
REVENUE PROJECTIONS May 15, 2019
2018-19 REVENUE
2018-19 REVENUE
•Water Sales
•Projected Water Sales of 6,277,000 HCF for $15,100,000
•Actual Water Sales Were 7,209,000 HCF for $16,269,000
•Water System (Meter) Charges
•$8,876,551 on Customer Connections
•$124,919 on Temporary Connections
•Wastewater System (Collection) Charges Projected Revenue:
•$3,543,420 on 19,125 SFR Accounts
•$1,104,247 on 1,080 MF/Commercial Accounts
3
2018-19 REVENUE -CONTINUED
•No Rate Adjustments Were Effective During the 2018-19 Fiscal Year
•Most Recent Adjustments:
•July 2017 -Commodity Rate Increased -½ of Phase 3 Adopted Rate (6%)
•July 2016 Water System (Meter Charge) -Phase 2 Implemented
•October 2012 -Wastewater System (Collection) Charges Increased 9%
•July 1, 2017 Wastewater Treatment Rate Increase -$0.70 per SFR (3%)
4
EVALUATING RESULTS –WATER REVENUE
$8,887,245 $8,943,223 $9,001,470
$5,908,583 $6,258,376 $6,229,945
$5,688,633 $5,940,316 $5,954,209
$2,940,651
$4,143,686 $4,084,748
$0
$5,000,000
$10,000,000
$15,000,000
$20,000,000
$25,000,000
$30,000,000
FY 2016-17 FY 2017-18 FY 2018-19
Meter Charges Tier 1 Tier 2 Tier 3
$14,537,867
$23.4 Million $25.3 Million
$16,342,378
$25.3 Million
5
$16,268,902
EVALUATING RESULTS –WASTEWATER REVENUE
$8,129,944 $8,578,638 $8,666,031
$4,543,978 $4,650,970 $4,647,667
$0
$2,000,000
$4,000,000
$6,000,000
$8,000,000
$10,000,000
$12,000,000
$14,000,000
FY 2016-17 FY 2017-18 FY 2018-19
System Charge Treatment Charge
$12.7 Million $13.2 Million $13.3 Million
6
REVENUE PROJECTIONS
WATER RATES
RATE
TYPE
CURRENT
RATES
PROPOSED
RATES
Tier 1 $ 1.73 $ 1.83
Tier 2 2.46 2.61
Tier 3 3.44 3.64
METER
SIZE
CURRENT
RATES
5/8”$ 23.06
3/4”29.27
1”41.71
1 1/2”72.81
2”110.13
3”228.30
4”402.44
6”819.44
8”1,503.28
Commercial
Fire Service 8.78 to 87.84
Implement Remaining Volumetric Rates
Adopted March 2015
Effective January 2020
8
WATER USAGE BY MONTH
0
200,000
400,000
600,000
800,000
1,000,000
1,200,000
July Aug Sept Oct Nov Dec Jan Febr March Apr May June
2015-16 2016-17 2017-18 2018-19 2019-20
Projected Usage for FY 2019-20
6,993,000 HCF or 5,230 MG
9
FY 2019-20 PROJECTED WATER REVENUE
$8,960,000 $9,001,470 $8,980,000
$15,100,000
$16,357,518 $15,900,000
$0
$2,000,000
$4,000,000
$6,000,000
$8,000,000
$10,000,000
$12,000,000
$14,000,000
$16,000,000
$18,000,000
FY 2018-19 Budget FY 2018-19 Projected FY 2019-20
Meter Water Sales
$24.1 Million $24.9 Million$25.3 Million
10
11
FY 2019-20 WATER SALES
RATE TYPE TIER 1 TIER 2 TIER 3
Residential $ 3,806,000 $ 3,715,000 $ 1,554,000
Multi-Family 1,624,000 963,000 763,000
Commercial 873,000 94,000 297,000
Irrigation /
Construction 0 1,305,000 906,000
Residential
$9,075,000
Multi-Family
$3,350,000
Commercial
$1,264,000
Irrigation
$2,211,000
TOTAL -$15,900,000
FY 2019-20 METER CHARGES
METER SIZE COUNT RATE
5/8”4,020 23.06
3/4”12,453 29.27
1”4,179 41.71
1 1/2”270 72.81
2”292 110.13
3”62 228.30
4”22 402.44
6”12 819.44
8”11 1,503.28
Commercial
Fire Services 255 Various
$1,113,000
$4,374,000
$2,092,000
$236,000
$1,000,000
$165,000
TOTAL -$8,980,000
5/8"3/4"1"1.5"2" and Larger Fire Svcs
12
FY 2019-20 WASTEWATER SYSTEM CHARGES
CUSTOMER TYPE SERVICE
CONNECTIONS
ESTIMATED
USAGE
MONTHLY FIXED
OR UNIT CHARGE
TOTAL
REVENUE
Residential 19,125 N/A $ 15.36 $ 3,525,000
Commercial / Multi-Family
Fixed 1,080 3.90 50,500
Volumetric 1,950,000 0.55 1,072,500
Commercial Total $ 1,123,000
Wastewater System Charges Total $ 4,648,000
13
FY 2019-20 WASTEWATER TREATMENT CHARGES
City of San Bernardino Rates Effective 7/1/2017
•Residential: $21.55 Monthly
•Multi-Family: $1.97, plus $1.53 per HCF
•Non-Residential: $3.52, plus $1.33 to $3.28 per HCF
FY 2018-19 FY 2019-20
Wastewater Treatment Charges $ 8,233,000 $ 8,665,000
Contract Services –Wastewater Treatment (8,233,000)(8,665,000)
Net Effect on District Operations $ 0 $ 0
14
FY 2019-20 WASTEWATER TREATMENT CHARGES
CUSTOMER TYPE
SERVICE
CONNECTIONS
ESTIMATED
USAGE
MONTHLY FIXED
OR UNIT CHARGE
TOTAL
REVENUE
Residential 19,125 N/A $ 21.55 $ 4,945,000
Multi-Family -Fixed 468 1.97 11,000
Multi-Family -Volumetric 1,320,000 1.53 2,019,000
Commercial -Fixed 612 3.52 26,000
Commercial -Volumetric 630,000 Various 1,664,000
Commercial Total $ 3,720,000
Wastewater Treatment Charges Total $ 8,665,000
15
FY 2019-20 OTHER CHARGES & REVENUE
$80,000
$115,000
$360,000
$80,000
$5,000
$31,000
$36,000
$300,000
$0 $50,000 $100,000 $150,000 $200,000 $250,000 $300,000 $350,000 $400,000
Initiation of Service Fee
Delinquent Fee
Disconnect Notice Charge
Disconnect / Reconnect Fee
Returned Payment Fee
Facility Rental Fee
Miscellaneous Revenue
Interest Revenue
TOTAL PROJECTED REVENUE -$1,007,000
16
FY 2019-20 PROJECTED RATE REVENUE
$7,165,655 $8,128,030 $8,697,671 $8,666,031 $8,665,000
$4,286,594 $4,703,439 $4,668,923 $4,647,667 $4,648,000
$19,990,600 $23,500,991 $26,063,647 $25,270,372
$24,880,000
$1,581,233
$1,116,089
$860,884 $834,000 $1,007,000
$0
$5,000,000
$10,000,000
$15,000,000
$20,000,000
$25,000,000
$30,000,000
$35,000,000
$40,000,000
$45,000,000
FY 2015-16 FY 2016-17 FY 2017-18 FY 2018-19 FY 2019-20
Wastewater Treatment Charges Wastewater System Charges Water Revenue Other
$33 Million $37.4 Million $40.3 Million $39.4 Million $39.2 Million
17
2019-20 OPERATING BUDGET SUMMARY
WATER WASTEWATER
Sales & Services $ 24,880,000 $ 13,313,000
Other Charges 471,000 200,000
Investment & Miscellaneous Revenue 284,000 52,000
Total Revenue $ 25,635,000 $ 13,565,000
Operations 17,549,000 12,420,000
Debt Service 4,066,000 312,000
Capital Expenditures 4,020,000 833,000
Total Expenditures $ 25,635,000 $ 13,565,000
18
2018-19 REVENUE
•Water Sales
•Projected Water Sales of 6,777,000 HCF for $15,100,000
•Actual Water Sales Were 7,209,000 HCF for $16,269,000
•Water System (Meter) Charges
•$8,876,551 on Customer Connections
•$124,919 on Temporary Connections
•Wastewater System (Collection) Charges Projected Revenue:
•$3,543,420 on 19,125 SFR Accounts
•$1,104,247 on 1,080 MF/Commercial Accounts
3
EVALUATING RESULTS –WASTEWATER REVENUE
$4,543,978 $4,650,970 $4,647,667
$8,129,944 $8,578,638 $8,666,031
$0
$2,000,000
$4,000,000
$6,000,000
$8,000,000
$10,000,000
$12,000,000
$14,000,000
FY 2016-17 FY 2017-18 FY 2018-19
System Charge Treatment Charge
$12.7 Million $13.2 Million $13.3 Million
6
FY 2019-20 PROJECTED WATER REVENUE
$8,960,000 $9,001,470 $8,980,000
$15,100,000
$16,268,902 $15,900,000
$0
$2,000,000
$4,000,000
$6,000,000
$8,000,000
$10,000,000
$12,000,000
$14,000,000
$16,000,000
$18,000,000
FY 2018-19 Budget FY 2018-19 Projected FY 2019-20
Meter Water Sales
$24.1 Million $24.9 Million$25.3 Million
10