HomeMy WebLinkAboutAgenda Packet - North Fork Water Company - 04/04/2017 (BOD)BOARD OF DIRECTORS ORGANIZATIONAL MEETING
(Immediately after the conclusion of the April 4, 2017 Annual Meeting of the Stockholders)
31111 Greenspot Road
Highland, CA 92346
April 4, 2017 - 2:00 PM
AGENDA
CALL TO ORDER
ROLL CALL OF BOARD MEMBERS
APPROVAL OF AGENDA
PUBLIC COMMENTS
1.Board Re-Organization
a) Election of Officers:
-President
-Vice President
-Secretary
-Chief Financial Officer
2.Discussion and possible action regarding update and revisions to the North
Fork Water Company Rules of the Ditch
3.Discussion and possible action regarding scope of work for, and issuance of,
Request for Proposal for consultant to determine value of the North Fork
Water Company shares
4.Financial Statements for FY 2016-17
5.Proposed FY 2017-18 Water Deliveries and Operational Update
6.Review and Adopt Budget and Assessments for FY 2017-18
7.Director comments
ADJOURN
Pursuant to Government Code Section 54954.2(a), any request for a disability-related modification or
accommodation, including auxiliary aids or services, that is sought in order to participate in the above-agendized
public meeting should be directed to the North Fork Board Secretary (909)885-4900 at least 72 hours prior to said
meeting.
NORTH FORK WATER COMPANY:
BOARD OF DIRECTORS MEETING
APRIL 4, 2017
(Agenda Item #2)
Michele A. Staples, Esq.
Eddy R. Beltran, Esq.
1
Proposed Revisions to
Rules of the Ditch
•Last updated in 2009
•Rules may be adopted and amended by NFWC
Board (By-laws sections 7.04 and 7.14)
•Proposed revisions generally fall into one of two
categories:
•Corrections/clarifications for consistency with By-laws
•Substantive updates and suggested changes previously
discussed by the Shareholders
2
Rules of the Ditch
(Suggested Changes)
•Section I.2: Clarifies estimated delivery schedule
and procedures for calculating and allocating
surplus water
•Section I.3: Allows for shut-off valves by
shareholders
•Sections I.7 and 8: Clarifies process for
cancellation of deliveries
•Section III: Adds common provisions to clarify that
Articles and By-laws control, allow for remaining
rules to remain effective if any is invalidated, and
discuss how Rules may be amended
3
Proposed Next Steps
•Board’s adoption of updates and revisions to Rules
of the Ditch
•Board may adopt updates and revisions to the
Rules of the Ditch by vote of a majority of a
quorum of the Board. (By-laws Article VII,
sections 3.11, 7.04 and 7.14)
4
North Fork Canal Rules of Operation
The North Fork Canal is a conduit for delivering surface water (raw,
untreated) to North Fork Water Company and Bear Valley Mutual
Water Company Shareholders. The canal begins at the North Fork
Divide, more recently referred to as the Southern California Edison
Powerhouse #3 Afterbay, and continues mostly west to its termination at
the southeast corner of Highland Avenue and Palm Avenue. In the
event that State Water Project water is used in lieu of Santa Ana River
water, there is a connection for receiving project water approximately
one-half mile west of the North Fork Intake Sandbox. There were
originally fifty-five (55) individually numbered irrigationwater
connections in the form of weir boxes, however, only fifteen (15) of
those connections are currently active.
In order to maintain the North Fork Canal and its historic operation
as a viable facility for the benefit of all Shareholders, the following
“Rules of the Ditch” have been outlined hereadopted by the North Fork
Water Company Board of Directors in accordance with Sections 7.04
and 7.14 of the By-Laws to clarify the North Fork Irrigationwater
delivery process.
I. Rules of the Ditch
1.) Each year at the North Fork Annual Board of Directors
Meeting following the Annual Meeting of the Shareholders,
the North Fork Zanjero will submit for approval the
following:
A.) A Delivery Schedule, outlining the daily deliveries that
will be made throughout the next irrigation season.
B.) A recommendation for aAn Estimated DeliveryA.)
Schedule outlining the estimated delivery rate, in
Miners’ Inch Days (MID), toper share which will
1345994.11345994.4
apply for the next irrigation season.12 months. The
Estimated Delivery Schedule is not a guarantee of
deliveries and is subject to change throughout the
next 12 months.
C.) A recommendation for a designated period of time toB.)
accomplish any repairs or maintenance required for the
continuous operation of the Canal during the next
irrigation season (Generally 2-4 weeks, between February
1, and March 31.). *During periods of drought conditions,
the Canal may not be shutdown at all from one irrigation
season to the next.
D.) An operations report of the last irrigationC.)
season and any recommendations for the next
irrigation season12 months.
1345994.11345994.4
2)Every 15th day of the month (or the first business day after the 15th day
of the month if the 15th day is a Saturday, Sunday or holiday), the
Zanjero will calculate the water initially allocated per share for the
following month. The Zanjero will contact all Shareholders that
received water delivery the previous month and inform them of their
respective initial allocation for the next month. At that time, each
Shareholder may request a reduction in its water allocation for the
next month, or notify the Zanjero of its need for additional water the
next month. The Zanjero shall calculate the amount of “Surplus
Water” available for the next month by adding: (1) the amount of
reductions in scheduled water allocations requested by Shareholders,
and (2) the amount of water forfeited by Shareholders that do not
receive water deliveries. The Zanjero shall apportion the Surplus Water
for the next month among the Shareholders who notified the Zanjero
of their need for Surplus Water and the allocation shall be on a pro
rata basis calculated as follows: each Shareholder shall receive a
percentage of the Surplus Water equal to the number of shares held by
it divided by the number of shares held by all Shareholders who
notified the Zanjero of their need for Surplus Water. Surplus Water
shall not be delivered to lessees of shares.
2.) 3)All irrigationwater deliveries to Shareholders shall be made to a
measuring device, usually a weir, and will be adjusted to the
appropriate flow rate by the Canalero only. Any adjustments must be
done by the Canalero and will be determined by the Canalero. Once
the water has passed over the weir (or alternate measuring device), the
water and the transmission facilities (pipeline or flume) are the
responsibility of the respective Shareholder receiving the delivery.
Each respective Shareholder, for its convenience or use, may install a
shut-off valve on its side of the weir to control the flow of water to its
premises. The responsibility to install, operate, maintain, replace and
repair said shut-off valve is that of the Shareholder, at its sole expense.
The North Fork Water Company disclaims any and all liability for any
damage or loss associated with a shut-off valve installed on a
Shareholder’s side of the weir and said liability shall be fully borne by
the respective Shareholder.
1345994.1
3.) 4)All irrigationwater deliveries shall be made by the Canalero per the
approved “Delivery Schedule”. Each delivery is for a twenty-four (24)
hour period, beginning between 7:00a.m. and 9:00a.m., and ending 24
hours later.
4.) 5)There is a minimum delivery requirement of ten (10) Miners’ Inch
Days per delivery. A delivery of less than 10 MID cannot be
accurately measured, and will not be allowed.
5.) 6)No irrigationwater deliveries shall be pumped out of the North Fork
Canal, or otherwise withdrawn by individual Shareholders.
6.) 7)Any irrigationwater delivery can be cancelled by the notification of the
Zanjero Zanjero for cause such as unavailable source water,
emergency shutdown or heavy downpours of rain, by notification to
the affected Shareholder(s) at least forty-eight (48) hours in advance
(unlessof the scheduled delivery (notice will not be provided if an
emergency shutdown is required) of the scheduled delivery. If an
irrigation. If a delivery is cancelled (or is the result of unavailable
source water, or heavy downpours of rain), that irrigationthat water
delivery will NOT be made up. The North Fork Delivery Schedule can
notcannot be altered, as it is designed to accommodate allotted TOTAL
daily deliveries, pursuant to the May 23, 1885 Contract
Agreementagreement and the related June 27, 1885 supplemental
agreement with Bear Valley Land and Water Co. (now known as Bear
Valley Mutual Water Company) and several individuals.
7.) 8)A Shareholder may cancel a scheduled delivery by notifying the
Zanjero at least one (1) business day in advance. Per Section 7.14
of the North Fork By-Laws, said notification to the Zanjero results
in a forfeiture of the Shareholder’s right to the delivery of that
water and the water delivery will NOT be made up. After a
shareholder has cancelled their delivery, or in the case of heavy rains
causing deliveries to be cancelled, it is the responsibility of the
individual Shareholders to contact the North Fork Zanjero with a
request to resume deliveries on their next scheduled delivery dates.
1345994.1
Such notification to the Zanjero must be made no later than one (1)
business day before the scheduled delivery date.
8.) 9)The North Fork Canalero shall set the TOTAL daily flow rate of the
Canal (Santa Ana River sourcewatersource water) at the North Fork
Canal Intake Sandbox 100” Weir at 7:00 a.m. each day. In the event
that State Water Project water is the sourcewatersource water, the
Canalero will verify the flowrate in the Canal at the Plunge Creek
Sandbox 100” Weir at 7:00 a.m. each morning.
1345994.1
9.) 10)It is the responsibility of the Canalero to check and clean all grates
(trash
racks) daily, to prevent damage from occurring due to plugging of pipe
and overflowing.
10.) 11)Each Shareholder with an authorized connection to the North Fork
Canal has just as much right to their delivery as any other
Shareholder on their respective delivery date.
11.) 12)In all disputes, the North Fork Zanjero’s decision will be adhered
to until such time as the North Fork Board of Directors can review
and bring to resolution.
12.) 13)As stated in the North Fork By Laws, water delivered from the
Canal is for agricultural purposes and other non-potable uses, and
is NOT to be used for “domestic potable water AT ANY
TIME!purposes” unless properly treated in accordance with all
applicable legal requirements.
II. Definitions:
Zanjero:
The Chief Operator of the North Fork Canal, responsible for
the operation of the North Fork Canal, and under the direction
of the Board of Directors.
Canalero:
Shift Operator for the North Fork Canal, under the directions of
the
Zanjero.
Weir:
A device for measuring flows across a fixed blade to determine an
accurate flowrate. The North Fork system uses some Parshall
1345994.1
Weirs and some Cipoletti Weirs.
Fred J. Stafford,
North Fork Canal Zanjero, 1989-2009
III. Miscellaneous Provisions
1) Relationship to Articles and By-Laws. These Rules are intended to
supplement the Company’s Articles of Incorporation and By-Laws. In
the event of a conflict between the Articles or By-Laws and any of
these Rules, the provisions of the Articles and By-Laws shall control.
2) Savings Clause. If any provision of these Rules is for any reason held
to be invalid by a court of law, such determination shall not affect the
validity of the remaining portions of these Rules which shall remain
binding and enforceable against the Shareholders of the Company.
3) Amendments to Rules. These Rules may be changed and amended
from time to time by appropriate action of the Board. .
Passed and adopted this ___ day of ________, 2017 by the North Fork Water
Company Board of Directors.
1345994.1
NORTH FORK WATER COMPANY:
BOARD OF DIRECTORS MEETING
APRIL 4, 2017
(Agenda Item #3)
Michele A. Staples, Esq.
Eddy R. Beltran, Esq.
1
Request for Proposal for
Consultant to Appraise
Value of NFWC Shares
•Valuation of shares is proposed to respond to
Shareholder questions about the value of NFWC
shares for investment planning and estate
planning
•Technical assistance needed to value shares
2
Scope of Work
•Summarize the condition of NFWC’s existing
water system
•Summarize NFWC’s assets and liabilities
•Determine the current value of NFWC on a per
share basis
•Prepare letter report and Appraisal Summary
Statement
3
Recommended RFP Recipients
1)Brian J. Brady
•Represented minority shareholder in Elsinore Valley
Municipal Water District /Meeks & Daly Water
Company transaction
2)David Hayward (Hayward Consulting)
•Prepared appraisal of Apple Valley Ranchos Water
Company for Town of Apple Valley
3)Steve Johnson (Stetson Engineers)
•Water system and water rights evaluation and
appraisal expert
4
Proposed Next Steps
•Board approval of:
–1) scope of work for Request for Proposal and
–2) issuance of Request for Proposal
•Board approval requires vote of a majority of a quorum
of the Board (By-laws Article VII, section 3.11)
•Legal Ad Hoc Committee to conduct consultant
interviews
•Board of Directors’ consideration and engagement of
consultant to value shares
•Report share valuation to Legal Ad Hoc Committee
•Report share valuation at Special Shareholder meeting
5
DRAFT
INTRODUCTION
North Fork Water Company (NFWC) is seeking proposals from qualified professional water
system and water rights appraisers to provide professional consulting, appraisal and valuation
services to aid NFWC in determining the fair market value of its shares. The Scope of Work does
not include expert testimony or other litigation support.
BACKGROUND
NFWC is a non-profit mutual water company located in Highland, California. There are currently a
total of 26 NFWC shareholders holding 7,156 shares in the company, with East Valley Water District
(EVWD) owning 82% of the shares (5,904 total). EVWD manages the NFWC.
NFWC holds pre-1914 appropriative water rights to Santa Ana River water supplies in trust for its
shareholders. NFWC owns a water delivery system including 50% ownership interest in the North
Fork Canal, as well as pipelines, diversion weir boxes and valves. The North Fork Canal is
approximately 6 miles in length and runs in an east-west direction, beginning generally near the
outlet of the Southern California Edison SAR #3 Hydroelectric Plant located at the Seven Oaks Dam
and ending near the cross streets of Highland Avenue and Palm Avenue in Highland, California.
NFWC’s water system’s transmission and distribution pipelines are primarily comprised of steel and
ductile pipe. NFWC’s water system does not include any surface water storage reservoirs.
The NFWC water system receives water delivered by Bear Valley Mutual Water Company under
agreements originally entered in 1885 and affirmed by the January 17, 1977, stipulation and judgment
entered by the San Bernardino Superior Court in Big Bear Municipal Water District v. North Fork Water
Company, et al. NFWC delivers water to a total of approximately 12 connections serving
shareholders and lessees of their shares. NFWC’s Board of Directors establishes the amounts and
schedules of its water deliveries to shareholders and their lessees. The NFWC water system is not
designed for domestic use, and water delivered by NFWC cannot be used for domestic purposes without
treatment.
The amount of water NFWC is entitled to receive under the 1885 agreements includes monthly
distributions during the June-November time period totaling approximately 3,800 acre-feet per year (afy),
and one-quarter of the annual river flow during the period of December thru May. According to annual
reports published by the Big Bear Watermaster from 2010-2015, the average annual water delivery to
NFWC during that period totaled approximately 2,300 afy.
NFWC has one class of shares. In order for shareholders to obtain water delivery, access to the North
Fork Canal and an approved measuring device/weir is required. Most of NFWC’s shareholders do not
receive water delivery from NFWC.
This Request for Proposals seeks a valuation of NFWC, including its water system and water rights, to aid
NFWC in valuing its shares.
MANDATORY SERVICE SPECIFICATIONS
The appraiser must have experience in valuing private and/or public water suppliers.
SCOPE OF WORK
The selected appraiser will provide appraisal/valuation of NFWC’s water system and water
rights as described below:
1) Summarize the condition of NFWC’s existing system using NFWC’s water system
inventory and maps, photographs, field visits, inspection reports, and results of interviews
with people familiar with existing water system equipment and operation.
2) Summarize NFWC’s assets and liabilities using: Appraiser’s summary of condition of
existing system prepared under Task 1 above; NFWC summary of water rights; Big Bear
Watermaster and East Valley Water District reports showing Bear Valley Mutual Water
Company’s deliveries to North Fork Canal; property profiles and property appraiser
reports (by others if applicable); NFWC’s Articles of Incorporation, Bylaws, Rules of the
Ditch and current shareholder roll; NFWC current financial statement.
3) Determine the current value of NFWC on a per share basis. The NFWC valuation will be
broken down into categories such as facilities, equipment, water rights, etc.
4) Prepare letter report containing Appraiser’s assumptions, sources of information, work
product and summary of current value of the NFWC. Twelve (12) hard bound copies of
the report are to be provided as well as electronic files.
5) Adhere to appraisal practices as required to conform to the Uniform Standards of
Professional Appraisal Practice (USPAP).
6) Prepare an Appraisal Summary Statement to assist NFWC staff in communicating the
appraisal results to NFWC shareholders.
7) Maintain timely communication with the assigned NFWC staff.
8) Create files and maintain all records for a period of seven (7) years.
9) Attend NFWC Board, Committee and/or Shareholder meetings, when requested.
S TAF F R E P ORT
Agenda Item #4.
Meeting Date: Ap ril 4, 2017
Dis c ussion Item
To: Board of Direc tors
From: G eneral Manager/C E O
S ubject: F inanc ial S tatements fo r F Y 2016-17
R E C O MM E N D AT IO N:
S taff rec ommends that the financ ial s tatements fo r F Y 2016-17 b e ad o p ted and filed .
B AC KG R O UN D / AN ALYS IS :
S ec tion 5.05(c ) of the No rth F o rk Water C ompany (NF W C ) Bylaws req uire that the Treas urer rend er to the
Bo ard o f Directors an acc o unting of the NF W C ’s trans actio ns and financ ial conditio n at regular meetings o f the
Bo ard . In o rder to c o mply with this sec tion of the Bylaws , annual financ ial s tatements are prepared b y s taff,
reviewed by an independent ac counting firm, and pres ented to the Board at eac h annual s hareholders meeting.
Attac hed are NF W C ’s financ ial s tatements as of, and for the twelve months ended, January 31, 2017. T he
s tatements are pres ented in c o mparative fo rm, p rior to c urrent year, in order to id entify s ignific ant variances.
Notab le items are:
O perating C as h inc reas ed by 54% c omp ared to las t year; the available b alance of $160,084 is equal to
app ro ximately 9 mo nths of o p erating expens es.
C as h R es tric ted fo r C apital P rojec ts inc reas ed by $98,065 as c ap ital as s es s ments c o llec ted in 2016-17 fo r
two pipeline rep airs had no t b een spent as o f January 31, 2017.
Legal exp ens es remain the mos t s ignific ant cos t at $83,637 as Jac kson Tidus continues its wo rk to update
bylaws , rules o f o p eratio ns, water rights , and other is s ues of importance to s hareho ld ers as d etermined by
the Legal Ad-Hoc C o mmittee.
T he financ ial s tatements were reviewed by the ac counting firm o f Van Lant & F ankhanel, who had no find ings as
a res ult of their proc ed ures .
R E VIE W B Y O T HE R S :
T his agenda item has been reviewed by the Ad minis tratio n and F inance Department.
F IS C AL IMPAC T :
T here is no fis c al impact ass ociated with this agenda item.
R ec o mmend ed b y:
John Mura
G eneral Manager/C EO
R espec tfully s ubmitted:
Brian Tomp kins
Treasurer
ATTAC H M E NTS:
Description Type
Financial Statements P resentation P resentation
F Y 201 6-17 Financial Statements Backup Material
APRIL 4, 2017
FINANCIAL
STATEMENTS
FOR FY 2016-17
FINANCIAL STATEMENTS & REPORTS
•Annual Financial Report
–Review Company’s
Financial Position and
Results of Operations
–Instrument of Financial
Disclosure
2
INDEPENDENT
ACCOUNTANT’S
REVIEW
NO FINDINGS
EXECUTIVE SUMMARY OF FINANCIAL STATEMENTS
Assets
Cash $ 160,084
Cash –Restricted for Capital Projects 218,866
Fixed Assets/Water Rights 2,978,991
Other Assets 17,658
TOTAL ASSETS 3,375,599
Liabilities $ 49,810
Shareholder Equity 3,325,789
TOTAL LIABILITIES & EQUITY $ 3,375,599
2016-17 Expenses
Repairs & Maintenance $ 27,826
Property Taxes 28,326
Other General &Administrative 100,212
Depreciation 54,649
TOTAL EXPENSES 211,013
2016-17 Shareholder Assessments
Shareholder Assessments –Operating 178,900
Shareholder Assessments –Capital 128,808
TOTAL SHAREHOLDER ASSESSMENTS 307,708
Change in Shareholder Equity $ 96,695
3
OPERATING BUDGET TO ACTUAL
BUDGET ACTUAL
Operating Labor / Equipment-EVWD $ 38,000 $ 19,676
Contract Services 17,200 10,350
Legal Services 85,000 83,637
Materials & Supplies 500 357
Administration 11,200 9,158
Insurance 4,100 4,060
Property , Franchise Taxes 30,000 29,126
$ 186,000 $ 156,364
Depreciation -54,649
$ 186,000 $ 211,013
2016-17 Assessments ($25)178,900 178,900
Increase in Operating Reserve $ (7,100)$ (32,113)
4
HIGHLAND, CALIFORNIA
for years ending
January 31, 2017 and January 31, 2016
FINANCIAL STATEMENTS
North Fork Water Company
A CALIFORNIA CORPORATION
Table of Contents
Schedule Page
Organization Data 1
Independent Accountants’ Review Report 2 - 3
Statements of Financial Position 4
Statements of Activities 5
Statements of Changes in Shareholders' Equity 6
Statements of Cash Flows 7
Notes to Financial Statements 8 – 11
Supplementary Information
Schedule of Property, Plant and Equipment, and
Accumulated Depreciation One 12 – 13
Schedule of Shareholders Two 14
Statement of Financial Position Comments Three 15 - 16
North Fork Water Company
(A California Corporation)
Organization Data
For the Years Ended January 31, 2017 and 2016
DATE AND STATE OF INCORPORATION 1885 - California
DURATION OF CHARTER Perpetual Existence
NATURE OF BUSINESS
Water Company Located in Highland, California
DATE OF EXEMPTION LETTER September 13, 1964
OFFICERS
Ronald Coats President
Christopher Carrillo Vice President
Brian Tompkins Treasurer
Justine Hendricksen Secretary
DIRECTORS
Charles Kiel Nanette Shelton
Ronald Coats Christopher Carrillo
James Morales, Jr. David Smith
Margaret Wright
MANAGER
Under Agreement with East Valley Water District
1
2
3
2017 2016
Current Assets
Cash 160,084$ 104,217$
Cash - Restricted for Capital Projects 218,866 120,801
Prepaid Expenses 15,747 15,956
Receivables
Assessments 1,911 1,794
Total Current Assets 396,608 242,768
Property, Plant, and Equipment
Improvements - Fencing 2,840 2,840
Pipelines and Valves 2,797,998 2,797,998
Construction In Progress 41,306 10,563
Less: Accumulated Depreciation (518,764) (464,115)
Total Property, Plant, and Equipment 2,323,380 2,347,286
Other Assets
Water Rights - January 31, 1952 655,611 655,611
Total Other Assets 655,611 655,611
Total Assets 3,375,599$ 3,245,665$
Current Liabilities
Accounts Payable 49,810$ 16,571$
Total Current Liabilities 49,810 16,571
Shareholders' Equity
Capital Stock Authorized 7,200 Shares - 7,156 Issued
and Outstanding at $100 Stated Value 715,600 715,600
Additional Paid-In Capital 514,600 526,626
Contributed Capital 1,608,462 1,646,308
Retained Earnings 487,127 340,560
Total Shareholders' Equity 3,325,789 3,229,094
Total Liabilities and Shareholders' Equity 3,375,599$ 3,245,665$
See accompanying notes and Independent Accountants' Review Report.
LIABILITIES AND SHAREHOLDERS' EQUITY
North Fork Water Company
(A California Corporation)
Statements of Financial Position
For the Years Ended January 31, 2017 and 2016
ASSETS
4
2017 2016
Revenues
Water Sales -$ -$
ExpensesRepairs and Maintenance
Labor and Equipment 19,676 30,021
Contracted 8,150 7,440
Administration 9,158 13,913
Accounting Fees 2,200 2,000
Legal 83,637 76,813
Materials and Supplies 357 125
Property Taxes 28,326 28,575
Insurance 4,060 4,016
Depreciation 54,649 54,843
Total Expenses 210,213 217,746
Loss from Operations (210,213) (217,746)
Other Income
Interest - -
Total Other Income - -
Excess of Expenses over Revenues before
Provision for Income Taxes (210,213) (217,746)
Provision for Income Taxes
State Income Taxes 800 800
Excess of Expenses over Revenues before Contributions (211,013) (218,546)
Contributions
Shareholder Assessments - Operating 178,900 71,560
Shareholder Assessments - Capital 128,808 157,432
Change in Equity 96,695$ 10,446$
See accompanying notes and Independent Accountants' Review Report.
North Fork Water Company
(A California Corporation)
Statements of Activities
For the Years Ended January 31, 2017 and 2016
5
Cumulative
Common Stock Additional Excess of Total
Issued and Paid-in Contributed Revenue Over Shareholders'
Outstanding Capital Capital Expenses Equity
Balance, January 31, 2016 715,600$ 526,626$ 1,646,308$ 340,560$ 3,229,094$
Shareholder Assessments 307,708 307,708
Excess of Expenses
Over Revenues (211,013) (211,013)
Allocate Depreciation (12,026) (37,846) 49,872 -
Balance, January 31, 2017 715,600$ 514,600$ 1,608,462$ 487,127$ 3,325,789$
Cumulative
Common Stock Additional Excess of Total
Issued and Paid-in Contributed Revenue Over Shareholders'
Outstanding Capital Capital Expenses Equity
Balance, January 31, 2015 715,600$ 538,652$ 1,684,154$ 280,242$ 3,218,648$
Shareholder Assessments 228,992 228,992
Excess of Expenses
Over Revenues (218,546) (218,546)
Allocate Depreciation (12,026) (37,846) 49,872 -
Balance, January 31, 2016 715,600$ 526,626$ 1,646,308$ 340,560$ 3,229,094$
See accompanying notes and Independent Accountants' Review Report.
January 31, 2016
January 31, 2017
North Fork Water Company
(A California Corporation)
Statements of Changes in Shareholders' Equity
For the Years Ended January 31, 2017 and 2016
6
2017 2016
Cash Flows from Operating Activities
Cash Paid for Services and Materials (122,116)$ (216,248)$
Interest received - -
Income Taxes Paid (800)(800)
Net Cash used by Operating Activities (122,916) (217,048)
Cash Flows from Financing Activities
Contributions from Shareholders to Pay Suppliers 307,591 232,331
Payments Received on Promissory Notes - -
Net Cash Provided by Financing Activities 307,591 232,331
Cash Flows from Investing Activities
Acquisition and Construction of Assets (30,743)-
Net Cash used for Investing Activities (30,743)-
Net Increase in Cash 153,932 4,720
Cash, Beginning of Year 225,018 220,298
Cash, End of Year 378,950$ 225,018$
Reconciliation of Excess of Expenses over
Revenues to Net Cash Used By Operating Activities
Excess of Revenue over (under) Expenses (211,013)$ (218,546)$
Adjustments:
Depreciation 54,649 54,843
(Increase) Decrease in:
Prepaid Expenses 209 11
Interest Receivable - -
Increase (Decrease) in:
Accounts Payable and Accrued Liabiities 33,239 (53,356)
Taxes Payable - -
Net Cash used by Operating Activities (122,916)$ (217,048)$
See accompanying notes and Independent Accountants' Review Report.
North Fork Water Company
(A California Corporation)
Statements of Cash Flows
For the Years Ended January 31, 2017 and 2016
7
North Fork Water Company
(A California Corporation)
Notes to Financial Statements
For the Years Ended January 31, 2017 and 2016
NOTE 1 - NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING
POLICIES
Nature of Operations
North Fork Water Company is a mutual water company. The Company's primary purpose is to secure
surface water from the Santa Ana River and other available sources for delivery to its shareholders in
accordance with its delivery schedules and rules and regulations.
Capitalization Policy
The Company’s capitalization basis is cost if assets are purchased or constructed and fair value if assets
are contributed.
Depreciation of Plant and Equipment
The carrying values of plant and equipment are depreciated over the estimated useful lives of the assets
using the straight-line method.
Provision for Income Taxes
The Company is exempt from federal income taxes under Section 501(c)(12) of the Internal Revenue
Code. Therefore, no provision for federal income taxes is reflected in the financial statements.
State franchise tax is computed at the current corporate rate. For the fiscal years ended January 31, 2017
and 2016 state franchise taxes were $800.
Use of Estimates
The preparation of financial statements in conformity with generally accepted accounting principles
requires management to make estimates and assumptions that affect certain reported amounts and
disclosures. Accordingly, the actual results could differ from those estimates.
Cash and Cash Equivalents
For purposes of the statement of cash flows, the North Fork Water Company considers cash and cash
equivalents as short term, highly liquid investments that are both readily convertible to known amounts
of cash and so near their maturity that they present insignificant risk of changes in value because of
changes in interest rates. Cash equivalents have an original maturity date of three months or less from
the date of purchase.
8
North Fork Water Company
(A California Corporation)
Notes to Financial Statements
For the Years Ended January 31, 2017 and 2016
As of January 31, 2017, the Company had $128,950 deposited with financial institutions that were in
excess of federal depository insurance limits. The federal deposit insurance limit is $250,000.
NOTE 2 - RELATED PARTY TRANSACTIONS
As of January 31, 2017, East Valley Water District owned 83% of the outstanding shares of the
Company. The Company and East Valley Water District have certain officers and directors in common.
The following related party transactions occurred for the years ending January 31, 2017 and January 31,
2016:
East Valley Water District paid the Company operating and capital assessments of $253,893 and
$188,944
The Company paid East Valley Water District for labor and administration of $28,834 and $43,934
9
North Fork Water Company
(A California Corporation)
Notes to Financial Statements
For the Years Ended January 31, 2017 and 2016
NOTE 3 - PROPERTY, PLANT, AND EQUIPMENT
A summary of changes in property, plant and equipment follows:
Balance Balance
January 31, 2016 Additions Deletions January 31, 2017
Distribution System
Pipelines $ 2,791,959 $- $- $2,791,959
Ditch Diversion Boxes 4,729 - - 4,729
Valves 1,310 - - 1,310
2,797,998 - - 2,797,998
Improvements
Fencing – North Fork Intake 2,840 - - 2,840
Construction In Progress
Pipeline Replacement 10,563 30,743 - 41,306
Total $ 2,811,401 $ 41,306 $- $2,842,144
Balance Balance
January 31, 2015 Additions Deletions January 31, 2016
Distribution System
Pipelines $ 2,791,959 $- $- $2,791,959
Ditch Diversion Boxes 4,729 - - 4,729
Valves 1,310 - - 1,310
2,762,355 - - 2,797,998
Improvements
Fencing – North Fork Intake 2,840 - - 2,840
Construction In Progress
Pipeline Replacement - 10,563 - 10,563
Total $ 2,765,195 $10,563 $- $2,811,401
10
North Fork Water Company
(A California Corporation)
Notes to Financial Statements
For the Years Ended January 31, 2017 and 2016
NOTE 4 - ANNUAL SHAREHOLDER ASSESSMENTS
Annual shareholder operating assessments were set at $25 per share for the year ended January 31,
2017. In addition, a capital replacement assessment of $18 per share was levied to pay for pipeline
replacement and to establish a replacement reserve.
NOTE 5 – CONSTRUCTION COMMITMENTS
The board approved capital projects for the period ended January 31, 2017. The commitment remaining
to contractors as of January 31, 2017 is $25,800. The capital project is related to the replacement and
installation of a 30-inch pipeline of the North Fork Canal crossing at the Santa Ana River.
NOTE 6 - SUBSEQUENT EVENTS
In the preparation of these financial statements, the Company considered subsequent events through
March 15, 2017, which is the date these financial statements were issued.
11
Schedule One
Page 1 of 2
January 31, 2017
Date Beginning Ending Remaining Beginning Ending
Acquired Balance Balance Life Years Balance Provision Balance
Canal Replacements 1995 41,862$ 41,862$ 28 17,164$ 837$ 18,001$
Canals - 1/2 interest Various 67,610 67,610 67,610 - 67,610 Ditch Diversion Boxes 1985 4,729 4,729 19 2,897 95 2,992 Canals - 36" Pipeline 1995 8,958 8,958 27 3,849 179 4,028 Canal Replacement (La Tourette)1997 37,511 37,511 30 14,249 750 14,999 Canal Replacement (Plunge Creek
Syphon to Cram School)1999 68,937 68,937 32 23,447 1,380 24,827 Pipeline Replacement
90' of 26" Pipeline
(behind Walmart)2002 9,941 9,941 34 2,985 199 3,184 Pipeline Replacement
16" Pipeline (Highland Avenue) 2004 3,010 3,010 36 780 60 840 Canal Replacement
36" Pipeline - SAR to
Plunge Creek Sandbox)2009 2,493,592 2,493,592 42.5 324,168 49,872 374,040 Pipeline Replacement
50' of 30" DIP - Highland at
VFW Hall 2011 26,205 26,205 44 2,620 524 3,144 Pipeline Replacement
220' of 24" - SAR Xing to Turnout 2014 34,333 34,333 47 1,374 687 2,061 6" Gate Valve (Wier 17)2014 1,310 1,310 17 132 66 198
2,797,998 2,797,998 461,275 54,649 515,924 Improvements:
Security Fencing - NF Intake 2003 2,840 2,840 0 2,840 2,840 Totals 2,800,838$ 2,800,838$ 464,115$ 54,649$ 518,764$
Construction in Progress 2017 10,563 41,306 0 ---
See accompanying notes and Independent Accountants' Review Report.
Property, Plant and Equipment Accumulated Depreciation
North Fork Water Company
(A California Corporation)
Schedule of Property, Plant and Equipment, and Accumulated Depreciation
For the Years Ended January 31, 2017 and 2016
12
Schedule One
Page 2 of 2
January 31, 2016
Date Beginning Ending Remaining Beginning Ending
Acquired Balance Balance Life Years Balance Provision Balance
Canal Replacements 1995 41,862$ 41,862$ 29 16,327$ 837$ 17,164$
Canals - 1/2 interest Various 67,610 67,610 67,610 67,610 Ditch Diversion Boxes 1985 4,729 4,729 20 2,802 95 2,897 Canals - 36" Pipeline 1995 8,958 8,958 28 3,670 179 3,849 Canal Replacement (La Tourette) 1997 37,511 37,511 31 13,499 750 14,249 Canal Replacement (Plunge Creek 00
Syphon to Cram School) 1999 68,937 68,937 33 22,067 1,380 23,447
Pipeline Replacement 0 0
90' of 26" Pipeline
(behind Walmart)2002 9,941 9,941 35 2,786 199 2,985 Pipeline Replacement 0 0
16" Pipeline (Highland Avenue) 2004 3,010 3,010 37 720 60 780 Canal Replacement
36" Pipeline - SAR to
Plunge Creek Sandbox)2009 2,493,592 2,493,592 43.5 274,296 49,872 324,168 Pipeline Replacement --50' of 30" DIP - Highland at --
VFW Hall 2011 26,205 26,205 45 2,096 524 2,620 Pipeline Replacement 0 0
220' of 24" - SAR Xing to Turnout 2014 34,333 34,333 48 687 687 1,374 6" Gate Valve (Wier 17)2014 1,310 1,310 18 66 66 132
2,797,998 2,797,998 406,626 54,649 461,275 Improvements:
Security Fencing - NF Intake 2003 2,840 2,840 0 2,646 194 2,840 Totals 2,800,838$ 2,800,838$ 409,272$ 54,843$ 464,115$
Construction in Progress 2017 - 10,563 0 ---
See accompanying notes and Independent Accountants' Review Report.
North Fork Water Company
(A California Corporation)
Schedule of Property, Plant and Equipment, and Accumulated Depreciation
For the Years Ended January 31, 2017 and 2016
Property, Plant and Equipment Accumulated Depreciation
13
Schedule Two
Number of
Shareholder Certificate Number(s)Shares
Linda Spitzer 1391 4.00
Arnott Poulty Ranch 1316 138.00
Arnott Brothers Enterprises 1341 55.00
Gailen & Helen Arnott 1129 66.67
William Buster 1057 8.00
Brucie Cagle 1373 4.00
Calvary Chapel 1375 72.50
29300 Baseline Partners, LLC 1123, 1124 48.00
Richard Christianson 1148 3.00
East Valley Water District 5,904.49
Christina Moreno 1379 8.50
Nigel C. Smith 1378 3.00
Jose Gutierrez 1308 9.00
Thomas Hooker 1384 17.00
Robert Hooker 1383 17.00
First American Title 1381 36.00
Garland Kemper 1154 50.00
Kiel Family Trust 1126, 1165, 1258, 1328 143.00
Fred McNeal 1156, 1246, 1248 43.20
McNeal, Duckworth McNeal, Inc.1360 6.80
Helen Merritt 1390 2.00
Beverly Rich 708 5.00
Luis E. & Jacqueline R. Curiel 1382 3.50
Michael & Patricia Raley 1218 5.00
Wright Family Trust 1362 465.67
Yucaipa Valley W. D.1392 37.67
Total 7,156.00
See accompanying notes and Independent Accountants' Review Report.
North Fork Water Company
(A California Corporation)
Schedule of Shareholders
For the Years Ended January 31, 2017 and 2016
14
Schedule Three
Page 1 of 2
See accompanying notes and Independent Accountants’ Review Report.
North Fork Water Company
(A California Corporation)
Statement of Financial Position Comments
For the Years Ended January 31, 2017 and 2016
CURRENT ASSETS
Current assets consisted of the following:
2017 2016
Cash in Checking $ 378,950 $ 225,018
Prepaid Insurance 1,707 1,670
Prepaid Taxes 14,040 14,286
Assessments Receivable 1,911 1,794
Totals $ 396,608 $ 242,768
WATER RIGHTS
There is an agreement dated May 23, 1895, between North Fork Water Company and Bear Valley Land and
Water Company (now Bear Valley Mutual Water Company) that provides for delivery of water to North
Fork Water Company as follows:
Month Day Inches
June 500
July 600
August 600
September 550
October 450
November 400
December through May ¼ Flow of Santa
Ana River at a
point known as
"The Divide"
The water deliveries in the period June through November may be reallocated between months, but no more
than 600 day inches are to be delivered in any one month.
Water rights, as summarized above, have been valued at $655,611, which is the difference between the par
value of the capital stock outstanding and the value of the remaining assets at January 31, 1952.
15
North Fork Water Company
(A California Corporation)
Statement of Financial Position Comments
For the Years Ended January 31, 2017 and 2016
PROPERTY, PLANT AND EQUIPMENT
A summary of property, plant and equipment, and accumulated depreciation is shown in Schedule One.
The value of the one-half interest in canals was the appraised value in 1940, with subsequent additions being
valued at cost.
The provision for depreciation amounted to $54,649 computed at established rates using the straight-line
method.
CURRENT LIABILITIES
Current liabilities consisted of the following:
2017 2016
Accrued Liabilities
Accounts Payable
Labor and Burden $ 122 $-
Legal – January 14,198 -
Landscaping 650 -
EVWD Insurance Reimbursement 4,097 4,008
Independent Accountant’s Review Fee - 2,000
Capital Expense – Pipeline Surveying 14,599 -
Capital Expense – Engineering Assessment 16,144 10,563
Total Accounts Payable 49,810 16,571
Total Current Liabilities $49,810 $ 16,571
16
S TAF F R E P ORT
Agenda Item #5.
Meeting Date: Ap ril 4, 2017
Dis c ussion Item
To: Board of Direc tors
From: G eneral Manager/C E O
S ubject: P ro posed F Y 2017-18 Water Deliveries and O perational Upd ate
R E C O MM E N D AT IO N:
R eview the river flow trend s to d ate and the propos ed F Y 2017-18 water d eliveries .
B AC KG R O UN D / AN ALYS IS :
T he 1885 c o ntrac t terms es tablished specific water d elivery obligatio ns to the North F o rk Water C omp any
s harehold ers during c o ntrac t and no n-contract perio d s . T he c o ntrac t mo nths of June through No vemb er are
assigned s p ecific delivery o b ligations and no n-c o ntrac t mo nths receive 25% of the river flo w. During F Y 2016-
17 monthly water deliveries during no n-contract mo nths were es timated for upc o ming months bas ed o n previous
S an Bernard ino Valley Water C o ns ervatio n Distric t flo w reports .
D IS C US S ION
C alifornia has been experienc ing a d ro ught fo r many years , whic h impac ts S anta Ana R iver flo ws . F o rtunately,
the wet winter through the end o f 2016, and beginning of 2017 have allowed for better river flow res ulting in
increas ed delivery amounts.
S harehold ers rec eived .9 MI in January, 1.5 MI in F ebruary, 1.7 MI in Marc h, and 1.7 for Ap ril. Delivery
amounts will c o ntinue to b e c alculated b as ed on ¼ o f the S anta Ana R iver flo w thro ugh May, and will b e p osted
o n www.eas tvalley.org. T he S even O aks Dam operato rs have elec ted to cond uct s low releas es o f the d am
through the beginning of 2017 as oppo s ed to p revio us years when they elec ted to do a large release in Ap ril.
P ro p o s ed F Y 2017-18 Delivery S c hed ule
Mo nth
Miners Inc h Day
(MI D)
Es t. R iver
F lo w C F S
NF S hare
C F S
NF Miners
Inc h
Miners
Inches
p er S hare
J anuary (Actual)¼ o f S anta Ana
R iver
16 4 200 .9
F ebruary
(Actual)
¼ o f S anta Ana
R iver
32 8 400 1.5
March (Actual)¼ o f S anta Ana
R iver
32 8 400 1.7
April ¼ o f S anta Ana
R iver
32 8 400 1.7
May ¼ o f S anta Ana
R iver
T B D T B D T BD T BD
J une 500 500 2.0
J uly 600 600 2.5
August 600 600 2.5
September 550 550 2.3
October 450 450 1.9
November 400 400 1.6
December ¼ o f S anta Ana
R iver
T B D T B D T BD T BD
R ec o mmend ed b y:
John Mura
G eneral Manager/C EO
R espec tfully s ubmitted:
P atrick Milroy
O p erations Manager
In the event of a s ignific ant rain fall of more than o ne half inch, deliveries will auto matic ally b e halted. W hen
water quality is c o mp romis ed, water is no t taken down the ditc h to p ro tect the d itc h from large quantities o f
s edimentation. If a cus tomer would like to continue their s cheduled d elivery following a rain fall, c usto mers may
c o ntact Eas t Valley Water District O p eratio ns Divis io n to resume their regularly s ched uled delivery. In ad d itio n,
d eliveries may be halted due to c ircumstanc e beyo nd NF W C ’s c o ntrol as a result o f S an Bernardino C o unty
F lood C ontro l, S outhern C alifornia Ed ison, or other o uts id e event. S taff will b e s ure to maintain communic ation
with shareho ld ers that may be impac ted by unexpected delivery dis ruptions .
S taff rec o mmend s app ro val o f the P ropos ed F Y 2017-18 Delivery S c hedule that will continue provid ing water
d eliveries d uring no n-c ontrac t months at levels that reflect S anta Ana R iver flo ws .
ATTAC H M E NTS:
Description Type
Water Deliveries and Operatio ns P rese ntatio n P resentation
APRIL 4, 2017
WATER
DELIVERIES &
OPERATIONAL
UPDATE
WATER DELIVERIES
•Rights under the 1885 Contract Terms
7
MONTH ALLOTMENT
(MINER’S INCHES PER DAY)
(MID)
ALLOTMENT
PER SHARE
(MINER’S INCHES)
(MI)
January -May 25% of Santa Ana River Flow
June 500 2.0
July 600 2.5
August 600 2.5
September 550 2.3
October 450 1.9
November 400 1.6
December 25% of Santa Ana River Flow
CHANGES IN SANTA ANA RIVER FLOWS (CFS)
8
0
5
10
15
20
25
30
35
40
45
50
January February March April May June July August September October November December
2013 2014 2015 2016
2017-18 PROJECTED WATER DELIVERIES
9
MONTH ALLOTMENTS (MID)ALLOTMENTS PER
SHARE(MI)
January (Actual)200 0.9
February (Actual)400 1.5
March (Actual)400 1.7
April (Estimate)400 1.7
May (Estimate)350 1.5
June 500 2.0
July 600 2.5
August 600 2.5
September 550 2.3
October 450 1.9
November 400 1.6
December 25%of River Flow TBD
OPERATIONAL
UPDATE
2016-17 NORTH FORK CANAL WORK
•Repair and Maintenance Activities
–Cleaned Out Sandbox
–Repaired Slide Gates at Weir 18
–Removed Graffiti at Plunge Creek Sandbox
•Vandalism is a Continued Point of
Concern Near Plunge Creek
11
SLIDE GATE REPAIR
12
GRAFFITI REMOVAL
13
SANTA ANA RIVER CROSSING
•Riveted Steel Pipe
•Installed in the 1930s
•Continual Leaks
14
10 GALLONS
PER HOUR LOST
650 LINEAR FEET
SANTA ANA RIVER CROSSING
Project Construction Design Construction
Management Total Cost
Replace 30 inch pipeline $ 52,000 $10,000 $15,000 $77,000
FY 2016-17 CAPITAL PROJECT
15
$38,500
ESTIMATED
SHAREHOLDER
COST
PLUNGE CREEK PIPELINE REPAIR
16
•Protect Infrastructure
•Eliminate Water Waste
•Address Vandalism
36-INCH
PIPELINE
200 LINEAR FEET
Plunge Creek Siphon
Option Project Design Construction
Management Construction Total Cost
1 Repair Existing Pipe /
Reinforce Concrete Armor $ 50,000 $ 10,000 $ 20,000 $ 80,000
2 Cure in place 120,000 18,000 0 138,000
3 Replace existing 140,000 21,000 TBD 161,000
FY 2017-18 CAPITAL PROJECT
17
$40,000
ESTIMATED
SHAREHOLDER
COST
OPTION 1
RECOMMENDED
PROJECT
S TAF F R E P ORT
Agenda Item #6.
Meeting Date: Ap ril 4, 2017
Dis c ussion Item
To: Board of Direc tors
From: G eneral Manager/C E O
S ubject: R eview and Ad o pt Budget and Asses s ments fo r F Y 2017-18
R E C O MM E N D AT IO N:
R eview and adop t the p ro p o s ed F Y 2017-18 Budget.
B AC KG R O UN D / AN ALYS IS :
Eac h year at the North F o rk Water C o mp any (C omp any) annual s hareholder ’s meeting, staff p resents propo s ed
o perating and capital budgets that predic t the cost of s ervice d elivery fo r the upc o ming year, includ ing rep airs to
c o mp o nents of the C o mpany’s water distribution s ystem that are very old and deteriorated.
T he 2017-18 p ropos ed b udgets continue to fund adminis trative efforts to d efine the rights and value associated
with s hares held b y s hareho lders with d ivers e needs , and to c o ntinue to s earch fo r the mo st c ost-effec tive
method for rep airing two s ec tions of pipe that span river/c reek b eds.
O p erating Budget
T he O perating Budget funds routine o p eratio ns , rep airs, and maintenanc e fo r the C ompany water delivery
s ys tem. It also pays for adminis trative s ervic es s uch as rec o rd -keep ing and legal s ervic es , to keep sharehold ers
info rmed ab o ut meetings , financ es and s hareho lder rights and obligatio ns . T he O perating Bud get p ro p o s ed fo r
fisc al year 2017-18 is s hown below:
Item
2016-17
Adopted
2016-17
Actual
2017-18
P roposed
O perations Lab o r $ 32,000 $ 18,923 $ 25,000
Ad minis trative Labor 11,000 9,033 16,000
Eq uipment C harges 6,000 753 6,000
Directo r's F ee 200 125 200
C o ntrac t S ervices 15,000 8,150 11,000
Materials & S up p lies 500 357 500
P ro fes sional S ervic es 2,200 2,200 2,200
Legal S ervices 85,000 83,637 95,000
P ro p erty / F ranchis e Taxes 30,000 29,126 30,000
G eneral Ins uranc e 4,100 4,060 4,100
TO TAL $ 186,000 $ 156,364 $ 190,000
O p erating labor and C ontrac t S ervices have b een d ec reas ed as ac tual c o s ts for 2016-17 were s ignific antly lower
than the amo unts bud geted. Adminis trative Labo r has been inc reas ed d ue to an expected increas e in antic ipated
level of effo rt assisting legal couns el in their res earc h o f C omp any doc uments and records . T he bud get fo r legal
s ervices has also inc reased to $95,000, as legal couns el c o ntinues to investigate the his tory, governanc e and
rights related to owners hip in the No rth F ork Water C o mpany, and begins an effo rt to determine the value o f
s hares .
S taff prop o s es that the 2017-18 O perating Budget b e fund ed thro ugh a comb inatio n of o p erating as s es s ments,
at $23 per share, and op erating reserves. T hes e two sourc es wo uld provide $164,588 and $25,412, res p ectively.
C apital I mprovements
S anta Ana R iver C rossing - T he prio r year C apital Budget inc lud ed $103,000 fo r design and cons truc tion
c o s ts to repair the p ipeline cross ing the S anta Ana R iver. T he appro ved method of rep air invo lved s lip lining the
exis ting pipeline to avoid disturbing the riverbed with c onstruc tio n equip ment, which would involve s ignific ant
p ermitting issues.
In December, s taff p roposed an alternate method fo r c o mpleting this rep air at the Engineering C ommittee
meeting. T his metho d involves using a c rane to lo wer a new s ectio n of pip e into p lace while s till being able to
avo id disturbing the river-bed. T he es timated cost to the C omp any for this method is $38,500, a s avings o f
$64,500.
P lunge Creek Crossing - T he p rior year C apital Bud get als o inc luded $22,000 to begin the d es ign fo r rep airs
to the P lunge C reek cro s s ing. An engineering ass es s ment c o nduc ted in 2015 es timated that the to tal c o s ts fo r
this p ro jec t would be b etween $140,000 and $350,000. T he Bo ard directed staff to c o ntinue to lo o k for mo re
c o s t-effective s olutions.
In acc ordanc e with Board directio n, s taff is also p ropos ing an alternative approach for this project. R ather than
replac ing o r c oating the entire pip e, staff p ro poses to make minor repairs to the pipe as need ed, and then
reinfo rc e c o nc rete armoring around the p ipe. T he estimated c o s t to the C o mpany fo r this project is $40,000, a
s avings o f at leas t $30,000.
T he total estimated cos t to North F o rk Water C o mp any for the two p ro jects above wo uld b e $78,500. As
C apital As s es s ments c o llec ted las t year were $125,000, no additio nal fund s are need ed in fis cal year 2017-18.
However, s taff is rec o mmend ing that the previous ly adopted b ud gets fo r the two p ro jec ts b e amend ed as
follows :
Item
Project
Budgets
P roposed
Amendments Amended B udgets
P ip eline - S AR C ro s sing $ 103,000 $ (42,000)$ 61,000
P ip eline - P lunge C reek C ro ssing 22,000 42,000 64,000
TO TAL $ 125,000 $ 0 $ 125,000
S ince the c urrent pro jects are funded , with ap proximately 60% contingenc y, and there are no new p ro jects b eing
p ropos ed , s taff is not recommending a C ap ital As s essment for F Y 2017-18.
R ec o mmend ed b y:
John Mura
G eneral Manager/C EO
R espec tfully s ubmitted:
Brian Tomp kins
Treasurer
R E VIE W B Y O T HE R S :
T his agenda item has been reviewed by the Ad minis tratio n, Engineering, and O peratio ns departments .
F IS C AL IMPAC T :
T here is no fis c al impact ass ociated with this agenda item.
ATTAC H M E NTS:
Description Type
Budget and Asse sment P resentation P resentation
APRIL 4, 2017
BUDGET &
ASSESSMENTS
20
2016-17 OPERATING BUDGET TO ACTUAL
BUDGET ACTUAL
Operating Labor/Equipment-EVWD $ 38,000 $ 19,676
Contract Services 17,200 10,350
Legal Services 85,000 83,637
Materials & Supplies 500 357
Administration 11,200 9,158
Insurance 4,100 4,060
Property, Franchise Taxes 30,000 29,126
$ 186,000 $ 156,364
Depreciation -54,649
$ 186,000 $ 211,013
2016-17 Assessments ($25 per Share)178,900 178,900
NET $ (7,100)$ (32,113)
PROPOSED 2017-18 BUDGET
21
DESCRIPTION ADOPTED 2016-17
BUDGET
PROPOSED 2017-18
BUDGET
OPERATING EXPENSES
Operating Labor/Equipment -EVWD $ 38,000 $ 31,000
Contract Services 17,200 13,200
Legal Services 85,000 95,000
Materials & Supplies 500 500
Administration 11,000 16,000
Director Fees 200 200
Insurance 4,100 4,100
Property/Franchise Taxes 30,000 30,000
Total Operating Expenses $ 186,000 $ 190,000
CAPITAL EXPENDITURES $ 125,000 $ 0
CAPITAL IMPROVEMENT PROGRAM
22
ADOPTED CAPITAL IMPROVEMENT PROGRAM
YEAR BUDGET
CURRENT
YEAR
COSTS
COSTS
-TO-
DATE
North Fork Pipeline Surveying 2015-16 $ 16,000 $ 14,599 $ 14,599
Engineering Assessment 2015-16 30,000 14,424 24,987
Santa Ana River Crossing 2016-17 103,000 1,720 (1)1,720
Plunge Creek Crossing 2016-17 22,000 0 0
TOTALS $ 171,000 $ 30,743 $ 41,306
(1) Does not Include encumbrance of Merlin Johnson contract for $25,800
REVISED CAPITAL IMPROVEMENT PROGRAM
23
ADOPTED CAPITAL IMPROVEMENT PROGRAM
YEAR BUDGET
CURRENT
YEAR
COSTS
COSTS
-TO-
DATE
North Fork Pipeline Surveying 2015-16 $ 16,000 $ 14,599 $ 14,599
Engineering Assessment 2015-16 30,000 14,424 24,987
Santa Ana River Crossing 2016-17 61,000 1,720 (1)1,720
Plunge Creek Crossing 2016-17 64,000 0 0
TOTALS $ 171,000 $ 30,743 $ 41,306
(1) Does not Include encumbrance of Merlin Johnson contract for $25,800
TOTAL PROGRAM BUDGET REMAINS THE SAME
PROPOSED 2017-18 ASSESMENTS
24
DESCRIPTION PROPOSED 2017-18 BUDGET
Proposed Expenses
Operating Expenses $ 190,000
Capital Expenditures 0
TOTA L PROPOSED EXPENSES $ 190,000
Proposed Funding -7,156 Shares
Operating Assessment -$23 per share $ 164,588
Operating Reserves 25,412
Capital Assessment 0
TOTAL FUNDING $ 190,000
$23
2017-18
ASSESSMENTS
$0
CAPITAL
ASSESSMENTS
CASH PROJECTION
25
OPERATING CAPITAL
RESERVE TOTAL
Balance -January 31, 2017 $ 160,084 $ 218,866 $ 378,950
Proposed 2017-18 Assessment 164,588 0 164,588
Proposed 2017-18 Expenditures (190,000)(78,500)(268,500)
Projected Balance –January 31, 2018 $ 134,672 $ 140,366 $ 275,038