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HomeMy WebLinkAboutAgenda Packet - Finance & Human Resources Committee - 12/01/2025FINANCE & HUMAN RESOURCES COMMITTEE DECEMBER 1, 2025 East Valley Water District was formed in 1954 and provides water and wastewater services to 108,000 residents within the cities of San Bernardino and Highland, and portions of San Bernardino County. EVWD operates under the direction of a 5­member elected Board. COMMITTEE MEMBERS David E. Smith Governing Board Member Ronald L. Coats Governing Board Member Finance & Human Resources Committee Meeting December 01, 2025 ­ 2:00 PM 31111 Greenspot Road, Highland, CA 92346 www.eastvalleywater.gov PLEASE NOTE: Materials related to an item on this agenda submitted to the Board after distribution of the agenda packet are available for public inspection in the District’s office located at 31111 Greenspot Rd., Highland, during normal business hours. Also, such documents are available on the District’s website at eastvalley.org and are subject to staff’s ability to post the documents before the meeting. Pursuant to Government Code Section 54954.2(a), any request for a disability­related 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 District Clerk at (909) 885­4900 at least 72 hours prior to said meeting. In order to comply with legal requirements for posting of agenda, only those items filed with the District Clerk by 12:00 p.m. on Wednesday prior to the following Wednesday meeting not requiring departmental investigation, will be considered by the Board of Directors. CALL TO ORDER PLEDGE OF ALLEGIANCE ROLL CALL OF BOARD MEMBERS PUBLIC COMMENTS Any person wishing to speak to the Board of Directors is asked to complete a Speaker Card and submit it to the District Clerk 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 California Brown Act, the Board of Directors is prohibited from discussing or taking action on any item not listed on the posted agenda. The matter will automatically be referred to staff for an appropriate response or action and may appear on the agenda at a future meeting. APPROVAL OF CONSENT CALENDAR All matters listed under the Consent Calendar are considered by the Board of Directors to be routine and will be enacted in one motion. There will be no discussion of these items prior to the time the board considers the motion unless members of the board, the administrative staff, or the public request specific items to be discussed and/or removed from the Consent Calendar. 1.Approve the October 27, 2025 Finance & Human Resources Committee meeting Minutes INFORMATIONAL ITEMS 2.Local Hazard Mitigation Plan 3.Wastewater Operator­In­Training Program 4.Review Authorization to Transfer Unclaimed Funds into the District's General Fund 5.Review the Draft Popular Annual Financial Report for Year Ended June 30, 2025 REPORTS 6.Finance Activities 7.Human Resource Activities ADJOURN FINANCE & HUMAN RESOURCES COMMITTEEDECEMBER 1, 2025East Valley Water District was formed in 1954 and provides water and wastewater services to108,000 residents within the cities of San Bernardino and Highland, and portions of SanBernardino County.EVWD operates under the direction of a 5­member elected Board.COMMITTEE MEMBERS David E. Smith Governing Board Member Ronald L. Coats Governing Board Member Finance & Human Resources Committee Meeting December 01, 2025 ­ 2:00 PM 31111 Greenspot Road, Highland, CA 92346 www.eastvalleywater.gov PLEASE NOTE: Materials related to an item on this agenda submitted to the Board after distribution of the agenda packet are available for public inspection in the District’s office located at 31111 Greenspot Rd., Highland, during normal business hours. Also, such documents are available on the District’s website at eastvalley.org and are subject to staff’s ability to post the documents before the meeting. Pursuant to Government Code Section 54954.2(a), any request for a disability­related 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 District Clerk at (909) 885­4900 at least 72 hours prior to said meeting. In order to comply with legal requirements for posting of agenda, only those items filed with the District Clerk by 12:00 p.m. on Wednesday prior to the following Wednesday meeting not requiring departmental investigation, will be considered by the Board of Directors. CALL TO ORDER PLEDGE OF ALLEGIANCE ROLL CALL OF BOARD MEMBERS PUBLIC COMMENTS Any person wishing to speak to the Board of Directors is asked to complete a Speaker Card and submit it to the District Clerk 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 California Brown Act, the Board of Directors is prohibited from discussing or taking action on any item not listed on the posted agenda. The matter will automatically be referred to staff for an appropriate response or action and may appear on the agenda at a future meeting. APPROVAL OF CONSENT CALENDAR All matters listed under the Consent Calendar are considered by the Board of Directors to be routine and will be enacted in one motion. There will be no discussion of these items prior to the time the board considers the motion unless members of the board, the administrative staff, or the public request specific items to be discussed and/or removed from the Consent Calendar. 1.Approve the October 27, 2025 Finance & Human Resources Committee meeting Minutes INFORMATIONAL ITEMS 2.Local Hazard Mitigation Plan 3.Wastewater Operator­In­Training Program 4.Review Authorization to Transfer Unclaimed Funds into the District's General Fund 5.Review the Draft Popular Annual Financial Report for Year Ended June 30, 2025 REPORTS 6.Finance Activities 7.Human Resource Activities ADJOURN FINANCE & HUMAN RESOURCES COMMITTEEDECEMBER 1, 2025East Valley Water District was formed in 1954 and provides water and wastewater services to108,000 residents within the cities of San Bernardino and Highland, and portions of SanBernardino County.EVWD operates under the direction of a 5­member elected Board.COMMITTEE MEMBERSDavid E. SmithGoverning Board Member Ronald L. CoatsGoverning Board MemberFinance & Human Resources Committee MeetingDecember 01, 2025 ­ 2:00 PM31111 Greenspot Road, Highland, CA 92346www.eastvalleywater.govPLEASE NOTE:Materials related to an item on this agenda submitted to the Board after distribution of theagenda packet are available for public inspection in the District’s office located at 31111Greenspot Rd., Highland, during normal business hours. Also, such documents are availableon the District’s website at eastvalley.org and are subject to staff’s ability to post thedocuments before the meeting.Pursuant to Government Code Section 54954.2(a), any request for a disability­relatedmodification or accommodation, including auxiliary aids or services, that is sought in orderto participate in the above agendized public meeting should be directed to the District Clerkat (909) 885­4900 at least 72 hours prior to said meeting. In order to comply with legal requirements for posting of agenda, only those items filed with the District Clerk by 12:00 p.m. on Wednesday prior to the following Wednesday meeting not requiring departmental investigation, will be considered by the Board of Directors. CALL TO ORDER PLEDGE OF ALLEGIANCE ROLL CALL OF BOARD MEMBERS PUBLIC COMMENTS Any person wishing to speak to the Board of Directors is asked to complete a Speaker Card and submit it to the District Clerk 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 California Brown Act, the Board of Directors is prohibited from discussing or taking action on any item not listed on the posted agenda. The matter will automatically be referred to staff for an appropriate response or action and may appear on the agenda at a future meeting. APPROVAL OF CONSENT CALENDAR All matters listed under the Consent Calendar are considered by the Board of Directors to be routine and will be enacted in one motion. There will be no discussion of these items prior to the time the board considers the motion unless members of the board, the administrative staff, or the public request specific items to be discussed and/or removed from the Consent Calendar. 1.Approve the October 27, 2025 Finance & Human Resources Committee meeting Minutes INFORMATIONAL ITEMS 2.Local Hazard Mitigation Plan 3.Wastewater Operator­In­Training Program 4.Review Authorization to Transfer Unclaimed Funds into the District's General Fund 5.Review the Draft Popular Annual Financial Report for Year Ended June 30, 2025 REPORTS 6.Finance Activities 7.Human Resource Activities ADJOURN Agenda Item #1 December 1, 20251 Meeting Date: December 1, 2025 Agenda Item #1 Consent Item 1 6 9 5 Regular Meeting TO: Committee Members FROM: Chief Financial Officer SUBJECT: Approve the October 27, 2025 Finance & Human Resources Committee meeting Minutes RECOMMENDATION That the Finance & Human Resources Committee approve the October 27, 2025 meeting minutes. DISTRICT PILLARS AND STRATEGIES V - Community Engagement, Advocacy, and Leadership a. Utilize Effective Communication Methods to Foster Exceptional Community Relations FISCAL IMPACT There is no fiscal impact associated with this agenda item. Respectfully submitted: ________________ Brian Tompkins Chief Financial Officer ATTACHMENTS October 27, 2025 Minutes Page 1 of 3 2 3 7 9 Draft pending approval EAST VALLEY WATER DISTRICT October 27, 2025 FINANCE & HUMAN RESOURCES COMMITTEE MEETING MINUTES PUBLIC COMMENTS APPROVAL OF CONSENT CALENDAR Page 2 of 3 2 3 7 9 REVIEW THE DRAFT ANNUAL COMPREHENSIVE FINANCIAL REPORT FOR FISCAL YEAR 2024-25 The Finance Manager introduced Mr. Scott Manno of Rogers, Anderson, Malody & Scott, LLP (RAMS), who presented the FY 2024-25 Audit. Mr. Manno outlined the audit process, noting that it began with the Interim Audit in April and concluded with the review of financial data in October. He reported that there were no significant changes in financial reporting compared to the prior year and no new accounting policies adopted during FY 2024-25. Information only, no action required. The Director of Administrative Services reported that a comprehensive classification and total compensation study has not been conducted since 2014. She stated that, under the 2023–2026 Memorandum of Understanding (MOU) with the East Valley Water District Employee Partnership, the District committed to completing this study during the third year of the agreement, with the results to be incorporated into the next MOU. She further noted that Gallagher Public Sector Human Resources and Recruitment Services Practice (Gallagher) has been selected to conduct the study. The Director of Administrative Services added that Gallagher has experience working with smaller agencies similar to the District, where staff are required to assume multiple roles. Information only, no action required. The Finance Manager provided an update on the Popular Annual Financial Report for FY 2024-25. The Committee agreed to hold a Special Meeting on Monday, December 1 to address items requiring presentation before year-end. The Director of Administrative Services provided updates on the Annual Benefits Fair, the Great Shakeout, and the Field Service Worker I recruitment. Page 2 of 3 2 3 7 9 Page 3 of 3 2 3 7 9 ADJOURN The meeting adjourned at 2:06 p.m. Ronald L. Coats David E. Smith Governing Board Member Governing Board Member Agenda Item #2 December 1, 20251 Meeting Date: December 1, 2025 Agenda Item #2 Informational Item 1 6 9 1 Regular Meeting TO: Committee Members FROM: General Manager/CEO SUBJECT: Local Hazard Mitigation Plan RECOMMENDATION East Valley Water District is currently updating its Local Hazard Mitigation Plan (LHMP), which outlines the District’s long-term strategy to reduce risks to life, property, and critical infrastructure from natural and man-made disasters. The LHMP identifies mitigation actions and projects by funding type, priority, and timeline, and serves as a key requirement for communities to remain eligible for federal mitigation grant funding. FEMA requires LHMPs to be updated every five years. To support this effort, the District has partnered with Navigating Preparedness Associates (NPA), an emergency management consulting firm, to assist with completing the update. This process will position the District to pursue grant funding for infrastructure improvements and strengthen preparedness across the District and its service area. Public engagement is an essential component of the LHMP update. Outreach efforts to date have included social media announcements, emails to selected stakeholders, and a public survey posted on the District’s website and shared through social media channels. Additional outreach includes the Finance/HR Committee Meeting, and the draft LHMP will be posted on the District’s website for public review and comment. The final LHMP update is scheduled to be presented to the Board of Directors for review and approval at the January 14, 2026, Board Meeting. A presentation will accompany the item and will also include updates to the District’s Risk and Resilience Assessment and Emergency Response Plan. DISTRICT PILLARS AND STRATEGIES III - Organizational Resiliency a. Advance Emergency Preparedness Efforts Agenda Item #2 December 1, 20252 Meeting Date: December 1, 2025 Agenda Item #2 Informational Item 1 6 9 1 FISCAL IMPACT There is no fiscal impact associated with this agenda item. Respectfully submitted: ________________ Kerrie Bryan Director of Administrative Services ATTACHMENTS Presentation Finance & Human Resources Committee December 1, 2025 2025 Local Hazard Mitigation Plan (LHMP) INTRODUCTION •EVWD is updating their LHMP •Plan must be updated every 5 years to be eligible for Federal and State grants •EVWD is requesting feedback from customers 2 HAZARD MITIGATION •Identifies Natural hazards •Earthquakes, floods, and wildfires •Identifies Man-made hazards •Cyberattacks, HAZMAT •LHMP assesses risk and mitigation measures 3 WHY LHMPS MATTER •Important source of State and Federal grant funds •Natural hazards are causing increasingly greater damage each year, especially wildfires •More people live in hazard-prone areas •Increased costs of disaster response and recovery 4 HAZARDS REVIEW Hazards included in the LHMP: 5 •Climate Change •Cyberattack •Dam Failure & Inundation •Drought •Earthquakes •Flooding •HAZMAT Incident •Heat Wave •Landslide •Power Loss/PSPS •Severe Storms •Wildfire MITIGATION ACTIONS •“Mitigation actions” are any projects, investments, or improvements that could reduce damage from a hazard •Based on EVWD and community priorities •Included based on cost, duration, and impact •Mitigation measures directed by EVWD •All must be tied to a funding mechanism and hazard 6 EXAMPLE ACTIONS •Identify pipelines that cross known fault lines •Where appropriate, install flexible piping and fortified connections at Fault Zones •Related Hazard: Earthquake •Priority Level: Medium •Timeframe: 5 years 7 EXAMPLE: EARTHQUAKE HAZARD 8 EXAMPLE ACTIONS 9 •Establish and reinforce defensible spaces around District facilities, water tanks, and other major infrastructure •Focus on areas near Fire Hazard Severity Zones •Related Hazard: Wildfire •Priority Level: Medium •Timeframe: Ongoing (Annually) EXAMPLE: WILDFIRE HAZARD 10 PUBLIC REVIEW DRAFT 11 •EVWD will post a draft of the LHMP for public comment on the EVWD website •Instructions for comments and my contact information will accompany the draft •Focus areas •Risk Assessment, Mitigation Actions •Comments will be addressed in report •Comment period will be open for three (3) weeks •LHMP will be sent directly to the CAC’s members QUESTIONS? Agenda Item #3 December 1, 20251 Meeting Date: December 1, 2025 Agenda Item #3 Informational Item 2 5 0 5 Regular Meeting TO: Committee Members FROM: General Manager/CEO SUBJECT: Wastewater Operator-In-Training Program RECOMMENDATION This agenda item is for informational purposes only, no action is required. BACKGROUND / ANALYSIS Operation of the Sterling Natural Resource Center (SNRC) requires State of California certified operators. If an operator vacancy occurs at SNRC, the District must utilize existing certified staff till the vacancy is filled. The District is creating an in-house Wastewater Operator-In-Training (OIT) program incorporating State requirements necessary for wastewater treatment certification. The program will complement the District’s Pathway Program and provide a bench for future wastewater operator vacancies at SNRC. The OIT program is to prepare individuals for a career as a certified wastewater treatment plant operator by providing hands-on experience and training. These programs allow trainees to perform routine tasks under supervision, learn to operate and maintain equipment, and gain the necessary experience to qualify for state certification. The new District program will comply with the State Water Resources Control Board’s (SWRCB) Office of Operator Certification requirements for the Wastewater OIT certification program which require OITs to have a high school diploma, or equivalent, have earned six educational points from a related course, and complete the SWRCB OIT application obtaining the District’s Chief Plant Operator’s signature. In addition to the SWRCB requirements, the District will require all OITs to possess a CA Driver’s License, earn an additional 4 educational points within 12 months of hire, and take and pass the SWRCB Grade 1 Wastewater Operator exam within 12 months of hire. There are many benefits to the District in offering an in-house OIT program: Pipeline of talent Increases staff engagement and retention Improved SNRC operational flexibility Agenda Item #3 December 1, 20252 Meeting Date: December 1, 2025 Agenda Item #3 Informational Item 2 5 0 5 Because the OIT program does not require prior work experience in the water/wastewater industry or a college degree, it offers strong employment potential for students who participated in the District’s Water and Wastewater Pathway Program. This will help expand the current Pathway program and offer new opportunities to the youth in our community. A new job classification has been created for the OIT position, and a corresponding salary range has been added to the District’s salary schedule. The job classification outlines the responsibilities assigned to the OIT, including food waste attendant duties, which eliminates the need for separate food waste attendant positions. DISTRICT PILLARS AND STRATEGIES I - Effective Solutions b. Encourage Performance Based Results through Staff Empowerment III - Organizational Resiliency b. Promote a Positive Organizational Culture FISCAL IMPACT The fiscal impact associated with this program was included in the FY 2025/26 budget. The two part-time Food Waste Attendant positions previously budgeted will be reallocated to fund the OIT positions. Respectfully submitted: ________________ Kerrie Bryan Director of Administrative Services ATTACHMENTS Presentation Finance and Human Resources Committee December 1, 2025 Wastewater Operator In Training: A Pathway to Certification and Employment PROGRAM GOALS •Train and prepare •Provide hands-on experience •Meet state certification requirements •Meet permit compliance standards •Public health and safety 2 WHAT IS A WASTEWATER OPERATOR IN TRAINING? •Person who works at a wastewater treatment plant •Gaining the experience to become a certified operator •Regulated by the State Water Resources Control Board (SWRCB) •Must complete 1,800 hours for certification •Requirements: •High school diploma or equivalent •6 related educational units •Complete SWRCB 3 BENEFITS OF AN IN-HOUSE OIT PROGRAM Pipeline of talent Facility-specific training Increases staff engagement and retention Improved operational performance and cost savings 4 BENEFITS TO THE TRAINEE Provides required experience Offers a career path Paid training and benefits Meaningful work No experience required 5 CALIFORNIA’S NEED FOR CERTIFIED OPERATORS •There are 900 wastewater treatment plants in California •There are only 6,000 certified wastewater operators statewide 6 WATER AND WASTEWATER PATHWAY •Successful program, offering hands-on experiences to high school students •OIT Program offers additional potential employment opportunities to pathway graduates •Great opportunity for students who are not university-bound 7 QUESTIONS? Agenda Item #4 December 1, 20251 Meeting Date: December 1, 2025 Agenda Item #4 Informational Item 1 6 8 8 Regular Meeting TO: Committee Members FROM: Finance Manager SUBJECT: Review Authorization to Transfer Unclaimed Funds into the District's General Fund RECOMMENDATION That the Finance & Human Resources Committee recommend to the Board of Directors to authorize the Chief Financial Officer to perform procedures prescribed in the Government Code and Code of Civil Procedure for the purpose of unencumbering stale- dated checks and keeping the related funds from escheating to the State. BACKGROUND / ANALYSIS The District’s checking account accumulates a long list of old, outstanding checks as a result of customer refunds relating to the closing of water accounts and paid vendors who failed to cash their check. All of the old checks make the reconciliation of the checking account unnecessarily cumbersome. Government Code sections 50050-50052 and Code of Civil Procedures section 1502(a)(2) describe procedures applied to unclaimed funds that are at least three years old. The procedure involves publishing a notice about the unclaimed funds once a week for two consecutive weeks in a paper of general circulation. Any claims that are submitted as a result of the notice will be investigated and approved or rejected by the CFO. Any funds remaining unclaimed 45 days after the first publication may be transferred to the District’s General Fund. Government Code section 50055 states that unclaimed funds of $15.00 or less that have been held by the District for more than one year do not need to be publicly noticed, but may be transferred into the District’s General Fund by simple action of the Board of Directors (Board). Staff recommends that the Board authorize the CFO to write off all stale-dated checks that are more than one year old and are less than $15.00 (attached Schedule A totaling $26.75). Staff is also requesting that the Board authorize staff to publish a notice regarding all stale-dated checks that are more than $15.00 and are more than three years old (attached Schedule B totaling $17,300.13) in the San Bernardino Sun newspaper for the purpose of satisfying the requirements of the Government Code. Agenda Item #4 December 1, 20252 Meeting Date: December 1, 2025 Agenda Item #4 Informational Item 1 6 8 8 DISTRICT PILLARS AND STRATEGIES II - Sustainability, Transparency, and Accountability a. Uphold Transparent and Accountable Fiscal and Resource Management FISCAL IMPACT The fiscal impact associated with this agenda item is $17,326.88 and could be converted from liability to Unrestricted Net Assets by following Government Code procedures to write off the checks listed on Schedules A and B. Respectfully submitted: ________________ Rudy Guerrero Finance Manager ATTACHMENTS Schedule A Schedule B SCHEDULE A UNCLAIMED CHECKS UNDER $15 & ONE YEAR OR OLDER PAYMENT DATE NUMBER VENDOR NAME AMOUNT 03/18/2024 262847 JAVIER RODRIGUEZ ALVA $3.47 04/25/2024 263067 GEMA CASTILLO 6.69 06/06/2024 263320 JULIO MENDEZ 13.81 09/19/2024 264025 LOREEN JAURIGUE 2.78 TOTAL $26.75 Page 1 of 1 SCHEDULE B UNCLAIMED CHECKS $15 AND OVER & THREE YEARS OR OLDER PAYMENT DATE NUMBER VENDOR NAME AMOUNT 12/20/2021 258825 ALFREDO NAVARRETE $100.00 01/13/2022 258903 NEW CONCEPT CONSTRUCTION 1,717.56 01/13/2022 258926 ROCIO ROCHEL 124.49 02/17/2022 259060 SAN BDNO AREA CHAMBER OF COMMERCE 220.00 03/24/2022 259248 EQUITY PREMIUM INVESTMENTS INC 115.71 05/19/2022 259482 JOE BORGES 501.09 06/08/2022 259591 GLORIA & GUSTAVO RODRIGUEZ 42.44 06/08/2022 259578 MELANIE MORRIS 150.00 06/08/2022 259583 PINEWOOD IRREVOCABLE TRUST 285.15 07/07/2022 259714 EDIBERTO VIZCARRA 215.82 07/07/2022 259712 CARLOS RIVERA 61.60 07/07/2022 259713 SARA LORENZO 100.00 07/13/2022 259731 GREY EAGLE VENTURES LLC 1,887.21 07/27/2022 259812 JAY MCCORMICK 75.00 07/27/2022 259813 JAY MCCORMICK 70.00 07/28/2022 259848 RJ Alcazar - KW&A 5,870.00 08/10/2022 259917 STEPHEN GICHURU 70.51 08/10/2022 259916 ANSELMO RAMIREZ 75.48 08/11/2022 259950 DONEGAN TREE SERVICE 4,500.00 08/24/2022 260002 WILLIAM WILSON 82.89 09/01/2022 260068 MABEL LYN EDGEMON 23.82 09/29/2022 260157 PATRICIA NAVA 56.87 10/13/2022 260231 CALIFORNIA WATER EFFICIENCY PARTNERSHIP 154.50 10/20/2022 260252 APREL C GLASS 24.59 10/20/2022 260289 UNIVERSAL SELF STORAGE HIGHLAND 575.40 10/26/2022 260293 TANIKA CALDWELL 100.00 11/03/2022 260329 WILLIAM RIEKEN 100.00 TOTAL $17,300.13 Page 1 of 1 Agenda Item #5 December 1, 20251 Meeting Date: December 1, 2025 Agenda Item #5 Informational Item 1 6 9 0 Regular Meeting TO: Committee Members FROM: Chief Financial Officer SUBJECT: Review the Draft Popular Annual Financial Report for Year Ended June 30, 2025 RECOMMENDATION This agenda item is for informational purposes only, no action is required. BACKGROUND / ANALYSIS Fiscal transparency is a pillar of the District to uphold the trust of the customers and stakeholders. The year-end financial report for fiscal year 2024-25 was submitted to the Board of Directors at the November 12, 2025 meeting. The District voluntarily prepares a Popular Annual Financial Report (PAFR) each year to be a summarized, user-friendly version of the District’s Annual Comprehensive Financial Report (Annual Report or ACFR). A PAFR translates complex financial data from the more detailed Annual Report into accessible language and visuals. The goal is to enhance transparency and foster better communication between the District and customers. Customers will receive a bill insert with their December bill and a QR code to view the PAFR on the District’s website. Hard copies will also be available at District Headquarters and the Sterling Natural Resource Center Customer Service lobbies. The Government Finance Officers Association (GFOA) produces guidelines for producing an effective PAFR, and if an agency’s PAFR substantially meets or exceeds those guidelines, the GFOA presents the agency with an Award for Outstanding Achievement in Popular Annual Financial Reporting. The District received the award for its June 2024 PAFR, for the eighth year in a row. District staff will submit the current year PAFR for award consideration before the end of December. DISTRICT PILLARS AND STRATEGIES II - Sustainability, Transparency, and Accountability a. Uphold Transparent and Accountable Fiscal and Resource Management FISCAL IMPACT There is no fiscal impact associated with this agenda item. Agenda Item #5 December 1, 20252 Meeting Date: December 1, 2025 Agenda Item #5 Informational Item 1 6 9 0 Respectfully submitted: ________________ Brian Tompkins Chief Financial Officer ATTACHMENTS Draft PAFR 2025 Highland, California Fiscal Year Ended June 30, 2025 po p u l a r a n n u a l fi n a n c i a l r e p o r t The Government Finance Officers Association of the United States and Canada (GFOA) has given an Award for Outstanding Achievement in Popular Annual Financial Reporting to East Valley Water District, for its Popular Annual Financial Report (PAFR) for the fiscal year ended June 30, 2024. POPULAR ANNUAL FINANCIAL REPORT FY 2024-25 PAFR | 2 Table of Contents About the District 3 Organizational Structure 4 District-at-a-Glance 4 District Pillars (Strategic Plan) 5 Community Involvement 5 Capital Improvement Projects 6 TRANSMITTAL LETTER Revenue and Expenses 7 Revenue by Sources 8 Breakdown of Expenses 9 Outstanding Long-Term Debt 10 Comparative Net Position 11 FINANCIAL PERFORMANCE 3 7 James Morales, Jr. Chairman of the Board Ronald L. Coats Vice Chairman of the Board Chris Carrillo Governing Board Member Phillip R. Goodrich Governing Board Member David E. Smith Governing Board Member Board of Directors In order to receive this award, a government agency unit must publish a Popular Annual Financial Report, whose contents conform to program standards of creativity, presentation, understandability, and reader appeal. We believe our current PAFR continues to conform to program requirements, and we are submitting it to GFOA to determine its eligibility for another Award. We also welcome and encourage feedback from District ratepayers to help make this publication more useful and/or informative. Government Finance Officers Association Award for Outstanding Achievement in Popular Annual Financial Reporting Presented to East Valley Water District California For its Annual Financial Report For the Fiscal Year Ended June 30, 2024 Executive Director/CEO Michael Moore, P.E. General Manager/CEO Brian Tompkins Chief Financial Officer Jeff Noelte Director of Engineering & Operations Justine Hendricksen District Clerk Kerrie Bryan Director of Administrative Services Manny Moreno Water Reclamation Manager Patrick Milroy Operations Manager Ryan Ritualo IT Manager William Ringland Public Affairs/Conservation Manager District Management 210 210 santa an a r i v e r sant a a n a r i v e r plun g e c r e e k plunge creek eld e r c r e e k cit y c r e e k city c r e e k sa n d c r e e k tw i n c r e e k tw i n c r e e k warm cr e e k cook creek mill c r e e k N San Bernardino SNRC Highland DistrictHeadquarters Seven Oaks Dam EAST VALLEY WATER DISTRICT | 3 Transmittal Letter We are pleased to present East Valley Water District’s (District) Popular Annual Financial Report (PAFR) for the fiscal year ending June 30, 2025 (FY 2024-25). This report summarizes financial information appearing in the 2025 Annual Report and was created to provide valuable information related to District finances and the 5-Year Capital Improvement Program, that support the quality and reliability of our community’s distribution system. The PAFR is unaudited; however, the financial data presented in the PAFR is developed based on the audited Annual Report, which is consistent with Generally Accepted Accounting Principles. This document can also be reviewed on the District’s website at eastvalleywater.gov/PAFR. For more detailed information, the District’s 2025 Annual Report is available for interested individuals at the District Headquarters, 31111 Greenspot Road, Highland, California 92346. It can also be viewed on the District’s website, along with other key financial documents, at eastvalleywater.gov/AnnualReport. The organizational chart, District-at-a-Glance, and financial data represent the District during the timeframe reflected in this document. Questions, comments, and feedback regarding this report are encouraged. Please do not hesitate to contact Brian Tompkins, Chief Financial Officer, at finance@eastvalleywater.gov or (909) 381-6463. On behalf of the District, thank you for the opportunity to serve you. Respectfully submitted, Michael Moore General Manager/CEO TO OUR RATEPAYERS & COMMUNITY The District was formed through a local election of mostly citrus grove farmers, to have water service provided by a public agency. East Valley Water District is located in the foothills of the San Bernardino Mountains, 65 miles east of Los Angeles in the County of San Bernardino. About the District 279Water LeaksRepaired 300Miles ofWater Main 15,310,926 Average Gallons ofWater Produced Daily 12 Active Groundwater Wells 28,977,000Gallons of Water Storage 1,250 Feet of Water Main Replaced 3,600 Water Samples Collected 1,800 Water Samples Collected at the SNRC 1,137HydrantsRepaired,Replaced,Inspected 578HydrantsFlushed 5,100 Manholes 230Miles ofWastewaterMains 6,300,000 Average Gallons ofWastewater Collected Daily 140 Miles of Wastewater Main Cleaned 64 Miles of Wastewater Main Monitored by Video FY 2024-25 PAFR | 4 Presented to the right is an overview of East Valley Water District’s organizational structure. The District employed 75 full-time positions during FY 2024-25. Organizational Structure As a performance-based organization, the District takes an active role maintaining staffing levels to performance-based objectives. East Valley Water District provides water and wastewater services to residents within a 30.1 square mile area. This includes over 108,000 people within the cities of Highland and San Bernardino, portions of the unincorporated County of San Bernardino, the Yuhaaviatam of San Manuel Nation, and Patton State Hospital. District-At-A-Glance The District has established five pillars to provide direction for operational and planning decisions. These pillars are an element of the Strategic Plan and guide initiatives to achieve the District’s Mission and Vision. To learn more about each pillar and view the District's Strategic Plan, visit eastvalleywater.gov/StrategicInitiatives. District Pillars & Strategic Plan EAST VALLEY WATER DISTRICT | 5 EffectiveSolutions Sustainability, Transparency, and Accountability Organizational Resiliency Planning, Maintenance, and Preservation of District Resources Community Engagement, Advocacy, and Leadership East Valley Water District is making investments beyond the water and wastewater system by partnering with local agencies and the San Bernardino City Unified School District to engage and inspire future water leaders. Investing in the Future Through Community Partnerships East Valley Water District partnered with Indian Springs High School to provide high school students with an immersive water and wastewater career internship program. This hands-on experience allows students to learn about operations, recycled water, and the various careers available in the field. water and wastewater educational pathway program The District partnered with the City of Highland, the Highland Fire Department, and Indian Springs High School to host a mentoring and motivational event for young women. The event featured mentoring sessions, team- building activities, and presentations led by accomplished female professionals, including District staff, the City Mayor, City Battalion Chief and local professionals. Together, they shared their experiences to introduce students to a wide range of career paths and leadership opportunities. young ladies of the future FY 2024-25 PAFR | 6 Capital Improvement Projects  plant 56 storage tank rehabilitation Project Budget: $963,175 Date Completed: June 2025 To strengthen water supply redundancy and resiliency, East Valley Water District rehabilitated a 500,000-gallon reservoir at Plant 56. The project included applying a new interior coating and installing an advanced anti-corrosion protection system to extend the reservoir’s service life, safeguard water quality, and ensure continued service reliability for the community. water main replacement oakridge court Project Budget: $119,689 Date Completed: May 2025 As part of East Valley Water District’s ongoing commitment to system reliability, District field staff replaced over 400 feet of undersized pipeline and installed a new fire hydrant on Oakridge Court in Highland. System enhancements improve services, reduce calls for leaks, and extend the life of the system. water main replacement elmwood road & dogwood street Project Budget: $321,796 Date Completed: Feb. 2025 District crews replaced more than 1,000 feet of water main along Elmwood Road. Projects like this enhance flow capacity, improve system reliability, reduce the frequency of repairs, and extend the overall lifespan of the water infrastructure. Financial Performance EAST VALLEY WATER DISTRICT | 7 Providing safe drinking water to over 108,000 residents every day is the District’s top priority and also one of its most significant expenses. The graphs below represent the District’s combined revenue and expenses for FY 2024-25. For comparison purposes, FY 2022-23 and FY 2023-24 revenue and expenses have also been included. Please refer to the District’s 2025 Annual Report for a comprehensive breakdown of expenses. REVENUES & EXPENSES Revenue Expenses GrantsNon-Operating Capacity Charges Non-OperatingOperating $46.16Million FY 2022-23 Operating $43.48Million FY 2022-23FY 2023-24 FY 2023-24 $45.36Million $49.80Million FY 2024-25 FY 2024-25 $59.12Million $60.84Million GrantsNon-Operating Capacity Charges Non-OperatingOperating $46.16Million FY 2022-23 Operating $43.48Million FY 2022-23FY 2023-24 FY 2023-24 $45.36Million $49.80Million FY 2024-25 FY 2024-25 $59.12Million $60.84Million East Valley Water District utilizes revenue to fund daily operations, scheduled capital improvements and replacements, and principal and interest for debt financed construction projects. Remaining revenue is added to reserves or invested back into capital improvement projects to help maintain and improve the system's reliability so that East Valley Water District may continue taking steps to support the District's Vision of providing world- class public service. Revenue also provides funding for conservation programming, which empowers customers to be efficient water users and encourages water savings indoors and out. How is Revenue Managed? FY 2024-25 PAFR | 8 The District relies on user rates/fees to fund day-to-day operations. East Valley Water District receives 99 percent of its revenue from user rates and fees; the District receives no funding from property or sales taxes. Rates and fees are reviewed on three to five year cycles and are adjusted to meet the costs of providing services to customers. A summary of FY 2024-25 rate revenue is shown below. Revenue by Sources Meter charges are fixed monthly charges assessed to customers based on the size of the service connection to their property. Wastewater collection revenue consists of 1) fixed monthly charges for residential customers and 2) a combination of fixed and volumetric charges for commercial customers. Wastewater treatment revenue consists of 1) fixed monthly charges for residential customers and 2) a combination of fixed and volumetric charges for commercial customers. Other charges are assessed according to an adopted fee schedule, but are only charged to users who request, or require, use of District resources beyond the scope of delivering normal water and wastewater services. Water sales are based on the volume of water used by a customer during the monthly billing period. Revenue History & Forecast (in millions) 38% Water Sales 20% Meter Charges 15% WastewaterCollection 24% WastewaterTreatment 3%Other Charges $14.4 $10.1 $11.2 $10 $5 $0 $15 $20 $25 $30 FY 22-23 Actual FY 23-24 Actual FY 24-25 Actual FY 25-26 Projected FY 26-27 Projected Water Operating Revenue Wastewater Operating Revenue Water Reclamation Operating Revenue $27.9 $28.6 $32.1 $31.5 $5.8 $6.1 $6.8 $32.4 $7.1 $18.3 $19.4 $7.3 Expenses are the cost of providing water to meet customer demand and collecting and treating wastewater from customer residences or places of business. East Valley Water District strives to provide safe and reliable water delivery services. The District has put forth significant effort to overcome the challenges of maintaining a fiscally sustainable and operationally dependable organization. Breakdown of Expenses EAST VALLEY WATER DISTRICT | 9 • Source of Supply - Expenses related to the extraction of groundwater, and for procuring water from the Santa Ana River or State Water Project when supply is available. • Pumping - Expenses related to moving water throughout the District’s water distribution system. • Water Treatment - Expenses related to the treatment of water. • Transmission and Distribution - Expenses for transmitting water to treatment plants and storage reservoirs for distribution to commercial and residential customers. • Customer Accounts - Expenses related to the service of customer accounts including, postage, telephone, printing and publishing, and billing services. • Wastewater Treatment - Expenses related to the contracted service currently provided by the City of San Bernardino Municipal Water Department. • Wastewater Collection - Expenses for the operation and maintenance of the District’s system of wastewater collection pipelines. • Administrative and General - Expenses related to the administration of District operations. For example, employee compensation, benefits, conservation rebates, office supplies, banking services, materials and supplies, utilities, fuel, permits, insurance claims, legal services, and printing and publishing. • Depreciation - Expenses related to the use of capital assets over time. • Interest Expense - Expenses incurred for borrowing funds. Explanation of Expenses Source of Supply Pumping Water Treatment Customer Accounts Wastewater Treatment Interest Expense Wastewater Collection Depreciation Administrative and General Transmission and Distribution 6¢3¢1¢21¢ 2¢7¢17¢29¢9¢ This graphic identifies how every dollar spent is allocated to cover expenses (in cents). expenses The District's long-term debt consists of bonds, loans and installment purchases. FY 2024-25 PAFR | 10 Much like how a mortgage is financed to spread costs over 30 years, East Valley Water District has incurred debt to fund large capital projects. The District has adopted a Debt Management Policy to clearly state that long-term borrowing is only to be used for Capital Improvement Projects that cannot be funded from current revenues. Similar to an individual’s credit score, public agencies have a bond rating used by investors to determine risk. The District has a bond rating of AA- by both Fitch and Standard and Poor’s rating services. This is considered a high quality investment grade. An explanation of debt in millions is shown below. Outstanding Long-Term Debt Sterling Natural Resource Center Low Interest (1.8%) Loan - Funded the design and construction of the District’s water recycling facility that captures and treats District wastewater flows. Recycled water is recharged to the Weaver basin. 2020A Bonds - Issued to refund outstanding 2010 revenue bonds and save $380,000 annually in interest. The 2010 bonds were issued to finance pipeline and other infrastructure projects. 2020B Bonds - Issued to refund outstanding 2013 revenue bonds, which were issued to finance the construction of a new administration and operations headquarters. State Department of Water Resources Loans - Funded the improvement and expansion of the District’s surface water treatment plant. $172.1 million $13 million $12.5 million $4.9 million As an infrastructure-based organization, the District directs significant resources in capital investments to maintain and improve its water and wastewater system. Comparative net position offers perspective of the District’s assets, liabilities, and equity. The information presented below applies to fiscal years ended June 30, 2025 and 2024. Two-Year Comparative Net Position (In Millions) EAST VALLEY WATER DISTRICT | 11 Current Assets - Cash and cash equivalents, customer utility receivables, inventory, prepaid expenses, and other liquid assets that can be readily converted to cash. Restricted Assets - Cash equivalents, grants and bonds restricted for a specific purpose and therefore not readily available to use. Other Assets - Special assessments receivable from certain property owners for system improvements that benefit only their properties. Capital Assets - Any land, building, equipment, vehicles, inventory, treatment plants, pipeline, and water distribution systems owned by the District. Deferred Outflow of Resources - Use of net assets attributed to future reporting periods, such as prepaid items and deferred charges. Explanation of Assets Current Liabilities - Present financial obligations including, payments to vendors, payroll, and employee benefits. Non-Current Liabilities - Long-term financial obligations including payments for loans, bonds, and employee retirement benefits. Deferred Inflow of Resources - Receipt of net assets attributed to future reporting periods, such as deferred revenue and advance collections. Equity (Net Position) - Represents the difference of assets plus deferred outflows of resources over liabilities plus deferred inflows of resources. Explanation of Liabilities and Equity (Net Position) $0.3 $23.0 $41.3 $322.0 $9.1 $19.9 $228.4 $145.2 $2.2 $44.1 $16.4 $318.6 $7.3 Current Assets Restricted Assets Other Assets Capital Assets Deferred Outows Current Liabilities Non-Current Liabilities Net Position Deferred Inows $15.7 $222.0 $146.9 $2.0 $0.2 2025 Total Assets: $386.6 Million 2024 Total Assets: $395.7 Million 31111 Greenspot Road Highland, California 92346 District Headquarters 31111 Greenspot Road Highland, California 92346 Sterling Natural Resource Center 25318 5th Street San Bernardino, California 92410 District Board Meetings Second and Fourth Wednesday of Each Month at 5:00pm District Headquarters Board Room 31111 Greenspot Road, Highland, CA 92346 eastvalleywater.gov East Valley Water District was formed in 1954 and provides water and wastewater services to over 108,000 residents within the cities of Highland and San Bernardino, and portions of San Bernardino County. The District operates under the direction of a 5-member elected Board. Office Hours Monday – Thursday 8:00am – 5:00pm 2nd and 4th Tuesday 9:00am – 5:00pm Friday 7:30am – 4:30pm Customer Service & After-Hours Emergency Service (909) 889-9501