HomeMy WebLinkAboutAgenda Packet - EVWD Board of Directors - 01/11/2011t"OEast Valley
Water District
3654 HIGHLAND AVE., SUITE #12, HIGHLAND, CA
BOARD MEETING January 11, 2011 3:00 P.M.
AGENDA
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"In order to comply with legal requirements for posting of agenda, only those items filed with the
District Secretary by 10:00 a.m. on Wednesday prior to the following Tuesday meeting not requiring
departmental investigation, will be considered by the Board of Directors ".
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CALL TO ORDER
PLEDGE OF ALLEGIANCE
1. Public Comments
2. Approval of Agenda
CONSENT CALENDAR
3. Approval of Board meeting minutes for December 14, 2010
4. Accounts Payable Disbursements: Accounts Payable Checks # 227021 through # 227135
which were distributed during the period of December 22, 2010 through January 4, 2011, in
the amount of $515,764.71. Payroll and benefit contributions for the period ended January 4,
2011 and included checks and direct deposits, in the amount of $231,808.98. Total
Disbursement for the period $747,573.69.
NEW BUSINESS
5. Discussion and possible action regarding the District's audited financial statements for
2009/2010
6. Discussion and possible action regarding the District's hiring freeze
7. Discussion and possible action regarding the flood damaged homes within the District's
boundaries
8. Discussion and possible action regarding award of contract for Plant 150 (Ion Exchange
System)
9. Directors' fees and expenses for December 2010
REPORTS
10. General Manager / Staff Reports
11. Consultant Reports
12. Committee Reports
• Legislative (Standing)
• Community Affairs (Standing)
• Policy Committee (Ad -Hoc)
• JPA Review (Ad -Hoc)
13. Oral comments from Board of Directors
CLOSED SESSION
14. CONFERENCE WITH LEGAL COUNSEL — ANTICIPATED LITIGATION
Initiation of litigation pursuant to Government Code Section 54956.9 (c)
One (1) Potential Case
15. PUBLIC EMPLOYEE PERFORMANCE EVALUATION
[Government Code Section 549571
Title: General Manager
ANNOUNCEMENT OF CLOSED SESSION ACTIONS
ADJOURN
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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 District's Administrative Manager at (909) 885 -4900
at least 72 hours prior to said meeting.
----------------------------------------- -------- -------- --------- --- - --
2
East Val ley
Water District
MISSION STATEMENT:
Our Mission at East Valley Water District is to provide our
customers with a safe and reliable water supply that is delivered
at a fair and cost - effective price.
Subiect to approval
EAST VALLEY WATER DISTRICT December 14, 2010
REGULAR BOARD MEETING
MINUTES
The meeting was called to order at 3:00 p.m. by President Wilson. Dr. Mathis led the flag salute.
PRESENT: Directors: Le Vesque, Malmberg, Morales, Sturgeon, Wilson
ABSENT: None
STAFF: Robert Martin, General Manager; Brian Tompkins, Chief Financial
Officer; Ron Buchwald, District Engineer; Cecilia Contreras,
Administrative Office Specialist; Justine Hendricksen, Administrative
Manager; Gary Sturdivan, Safety & Regulatory Affairs Director
LEGAL COUNSEL: Steve Kennedy
GUEST (S): Charles Roberts (Highland Community News), Dr. Bill Mathis (Mathis
Group); Larry Sharp (CSUSB), Mike Kovac (CSUSB); Susie Earp
(CSUSB); Cara Van Dijk (CV Strategies); Alex Altman (CV Strategies);
Dick Corneille (CDM); Board Members from Baseline Gardens Mutual
Water Company
PUBLIC COMMENTS
President Wilson declared the public participation section of the meeting open at 3:01 pm.
There being no verbal or written comments the public participation section was closed.
APPROVAL OF AGENDA
M/S /C (Malmberg- LeVesque) that the December 14, 2010 agenda be approved as
submitted.
ADJOURN TO EAST VALLEY PUBLIC FACILITIES CORPORATION MEETING AT
3:02 PM
RECONVENE TO EAST VALLEY WATER DISTRICT REGULAR BOARD MEETING
AT 3:03 P.M.
ADJOURN TO EAST VALLEY WATER DISTRICT'S FINANCING AUTHORITY
MEETING AT 3:03 P.M.
RECONVENE TO EAST VALLEY WATER DISTRICT REGULAR BOARD MEETING
AT 3:04 P.M.
Minutes 12/14/10
cmc
APPROVAL OF BOARD MEETING MINUTES FOR NOVEMBER 9, 2010
M/S /C (LeVesque - Malmberg) that the November 9. 2010 Minutes be approved as
submitted.
APPROVAL OF BOARD MEETING MINUTES FOR NOVEMBER 23, 2010
M/S /C (LeVesque - Malmberg) that the November 23, 2010 Minutes be approved as
submitted.
DISBURSEMENTS
M /S /C (LeVesque - Malmberg) that the General Fund Disbursements #226707 through
#226859 which were distributed during the period of November 7. 2010 through December 6,
2010, in the amount of $1,079,967.91 and Payroll and Benefit contributions for the period ended
December 6, 2010 and included checks and direct deposits, in the amount of $330,232.89
totaling $1,410,200.80 be approved.
REVIEW AND DISCUSSION OF JOINT POWERS AGREEMENT WITH THE CITY
OF SAN BERNARDINO WATER DEPARTMENT
The General Manager gave a brief overview regarding the Joint Powers Agreement that the
District has with the City of San Bernardino Water Department. He stated that it contains the
layout and boundaries for the service area, trunk line provisions, wastewater treatment capacity
charges, etc.
Director Malmberg questioned the benefit for any changes to be made.
Director Morales stated that in the newest amendment (number six) in reference to regional
costs, there is language that discusses the Inland Empire Wastewater Advisory Board and would
like to know more information.
President Wilson assigned an Ad -Hoc committee to review the Joint Powers Agreement and
bring information back to the entire Board.
Director Malmberg and Director Morales are assigned to the Ad -I loc Committee
DISCUSSION AND POSSIBLE ACTION REGARDING AWARD OF CONTRACT FOR
PLANT 150 FINAL DESIGN TO CAMP DRESSER & MCKEF, INC. (CDM)
The General Manager stated that it is now the appropriate time to begin final design for Plant
150; that CDM's design process will take the majority of the yl-ar to accomplish but the cost
numbers that are listed are still good; that Plant 150 will serve sek eral groundwater wells that are
susceptible to perchlorate and nitrate contamination.
2 Minutes 12/14/10
cmc
Mr. Kennedy stated that some milestones and dates listed in the current proposal needed
updating.
Mr. Buchwald stated that the dates will be updated in the final contract.
Director Malmberg questioned the ability of the treatment plant and the ability to accommodate
any new regulations from the State for a lower perchlorate level.
Mr. Buchwald stated that Plant 150 would have the blending capacity and that the site is large
enough to expand if needed.
M /S /C (LeVesque - Malmberg) to award the contract for Plant 150 final design to Camp
Dresser & McKee, Inc. (CDM).
DISCUSSION AND POSSIBLE ACTION REGARDING PRESENTATION FROM MIKE
KOVACK (CSUSB) RELATING TO THE WATER LIBRARY
Mr. Kovack thanked the District for their continued support.
Ms Earp stated that she will be re -doing her interview with the Wrights regarding North Fork;
that there are several updated aerial photos posted on the website dating back to the 1920's; that
Joe Rowe was presented with the Water Hero's award.
Mr. Sharp discussed the partnership between Cal State University San
University of California, Riverside and that the records from the water
between the two colleges and that there will be electronic versions available.
No action taken. Information only.
BOARD REORGANIZATION
President Wilson declared nominations open for Board Reorganization
M/S (Sturgeon - Malmberg) to keep the current slate of officers:
Bernardino and the
library will be split
Vice President LeVesque stated that he would like to offer the Vice President role open for
nomination.
M/S /C (Sturgeon - Malmberg) to keep the current slate of officers:
President — George E. Wilson
Vice President — Matt LeVesque
General Manager — Robert Martin
Chief Financial Officer — Brian Tompkins
Minutes 12/14/10
Me
M/S /C (Sturgeon - Malmberg) to keep the current committee assignments with the
addition of the Ad -Hoc committee to review the Joint Powers Agreement with the City of San
Bernardino Water Department.
SETTING TIME AND PLACE FOR HOLDING MEETINGS
President Wilson declared the time and place for holding regular meetings is open for discussion.
M/S /C (LeVesque - Malmberg) that the District's regular Board meetings be held at the
District's Office located at 3654 E. Highland Avenue, Suite 12. Highland, California, on the
second (2 "d) and fourth (4th) Tuesday of each month at 3:00 p.m.
DISCUSSION AND POSSIBLE ACTION REGARDING THE PROPOSITION 218
HEARING NOTICE FOR WASTEWATER TREATMENT RATES
The General Manager discussed the City of San Bernardino Water Departments proposed
wastewater treatment rate increase: that this would require the District to hold a Proposition 218
hearing.
The Board discussed a number of items relating to the proposed increase including, but not
limited to, the effective date of the increase, majority protests and how protests will be weighed,
technical issues relating to the computation of the rates, a new ad -hoc committee to review the
proposed rates, an additional matrix study that may affect the District, a review of the surcharge
to customers east of Boulder. No action taken.
DISCUSSION AND POSSIBLE ACTION REGARDING MILEAGE REIMBURSEMENT
RATE ESTABLISHED BY THE IRS FOR 2011
M /S /C (LeVesque - Sturgeon) that the District follows the mileage reimbursement rate
established by the IRS for 2011.
DISCUSSION AND POSSIBLE ACTION REGARDING THE ENGINEERING
INVESTIGATION STUDY RELATING TO BASELINE GARDENS MUTUAL WATER
COMPANY SUBMITTED BY MCKEEVER ENGINEERING
Mr. Sturdivan gave an update on the events regarding Baseline Gardens Mutual Water Company;
that they have an emergency connection with the City of San Bernardino Water Department; that
he attended a public meeting with the Board members from Baseline Gardens to discuss the
future of the Mutual Water Company; that at that meeting, there was a survey taken to see the
interest the property owners would have in consolidating with East Valley Water District; that
the District will have to go through the same processes as it has done in the past with the
Eastwood Farms consolidation; that a proposal has been received from McKeever Engineering to
do a preliminary engineers report.
The General Manager stated that in the next few months Baseline Gardens and East Valley will
apply for a grant to cover the costs of the consolidation; that Fast Valley would need to provide
4 Minutes 12/14/10
cmc
the funds upfront for the preliminary engineers report but the costs would be recovered from the
grant.
Director Morales stated his concern regarding the customer response and if there was any
opposition to the consolidation.
Mr. Sturdivan stated that in comparison to Eastwood Farms consolidation, he has a more
comfortable feeling when it comes to the consolidation with Baseline Gardens.
M /S /C (Sturgeon - LeVesque) to approve and proceed with the engineering investigation
study relating to Baseline Gardens Mutual Water Company submitted by McKeever
Engineering.
REVIEW AND ACCEPT FINANCIAL STATEMENTS FOR THE PERIOD ENDING
OCTOBER 31, 2010
Mr. Tompkins gave a brief overview of the financial statements.
M /S /C (Sturgeon - Malmberg) to accept the financial statements for period ending October
31, 2010 as submitted.
DIRECTORS' FEES AND EXPENSES FOR NOVEMBER 2010
M/S /C (Sturgeon - LeVesque) to approve the Directors' Fees and Expenses for November
2010
GENERAL MANAGER /STAFF REPORTS
The General Manager stated that Fish & Wildlife has come out with their decision regarding the
Santa Ana Sucker Fish; that the Task Force is currently reviewing this document and it could
possibly have significant impacts; that the next Task Force meeting will be after the New Year.
The General Manager gave an update on the District's Suite 30 improvements; that the
construction is moving along well, however, the City of San Bernardino's inspector has stated
that the ADA standards for the parking lot are not in compliance.
CONSULTANT REPORTS
Ms Van Dijk stated that CV Strategies is working on the District's Strategic Communication
Plan; that they are also working with the Santa Ana Sucker Fish Task Force on getting the
message out to local agencies that would be affected.
COMMITTEE REPORTS
a. Legislative (Standing) - No comments at this time
b. Community Affairs (Standing) - No comments at this time.
j Minutes 12/14/10
cmc
c. Policy (Ad -Hoc) - Director Morales stated that the Committee will be meeting soon
to work on the Drug and Alcohol Policy.
d. General Manager's Review (Ad -Hoc) - This item to be discussed in Closed Session.
ORAL COMMENTS FROM BOARD OF DIRECTORS
Director Morales expressed his thanks to staff for a great Annual ? wards Banquet
Director Malmberg stated that he very much enjoyed the Annual Awards Banquet
President Wilson stated that the ACWA conference was great and that he enjoyed listening in on
the session where Director LeVesque was on the Panel.
LETTER OF APPRECIATION TO THE DISTRICT FROM RITA SCHMIDT SUDMAN
(WATER EDUCATION FOUNDATION) AND JO MCANDREWS (MCANDREWS AND
BOYD)
Information Only
ASSOCIATION OF THE SAN BERNARDINO COUNTY SPECIAL DISTRICTS
MEMBERSHIP MEETING, SAN BERNARDINO, DECEMBER 13, 2010
Information Only
SAN BERNARDINO AREA CHAMBER OF COMMERCE ANNUAL HOLIDAY
RECEPTION & OPEN HOUSE, SAN BERNARDINO, DECEMBER 16, 2010
Information Only
CALIFORNIA MUNICIPAL UTILITIES ASSOCIATION CAPITOL DAY,
SACRAMENTO, JANUARY 24, 2011
Information Only
CSDA'S "HOW TO BE AN EFFECTIVE BOARD MEMBER ", VARIOUS LOCATIONS
AND DATES FOR 2011
Information Only
WATER EDUCATION FOUNDATION'S 2011 WATER TOUR DATES
Information Only
WATER EDUCATION FOUNDATION'S 28TH ANNUAL EXECUTIVE BRIEFING
"NAVIGATING UNCERTAIN WATERS ", SACRAMENTO, MARCH 24-25,2011
Information Only
The Board took a break at 4:43 p.m.
The Board retuned to session at 4:50 p.m
CLOSED SESSION
Minutes 12/14/10
Me
The Board entered into Closed Session at 4:50 p.m. as provided in the California Open Meeting
Law. Government Code Section 54945.9(a), to discuss those items listed on the agenda.
ANNOUNCEMENT OF CLOSED SESSION ACTIONS
The Board returned to regular session 5:32 p.m. The items listed on the agenda were discussed in
closed session with no reportable action.
FEVO "11012
The meeting was adjourned at 5:32 p.m. until the next regularly scheduled Board Meeting.
George Wilson, President
Robert E. Martin, Secretary
Minutes 12/14/10
Me
East Val ley
Water District
Board Memorandum
From: Brian W. Tompkins / Chief Financial Officer
Oq
Subject : Disbursements.
Recommandation:
Approve the attached list of accounts payable checks and
payroll issued during the period December 22, 2010
through January 4, 2011.
Date JANUARY 11, 2011
Background:
Accounts payable checks are shown on the attached listing and include numbers 227021 to 227135 for
A total of $515,764.71.
The source of funds for this amount is as follows:
Unrestricted Funds $515,764.71
Bond Financing
State Financing
Payroll and benefit contributions paid for this period totaled $231,808.98.
Total disbursements $747,573.69.
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District
Board Memorandum No. B -02 -2011 Date: January 11, 2011
From: Robert E. Martin, General Manager
Subject : EVWD Hiring Freeze
Recommendation : Authorize the recruitment and hiring of a new Engineer and a new
Water Service Worker
For the past year the Board has, due to budgetary considerations, imposed a hiring freeze
on the District. As of this date, the District has four positions that are now unfilled.
These include a staff engineering position and three water service worker positions.
Although these vacancies have certainly helped the District cope with the economic
conditions that we have faced, they have also created problems with the performance of
our normal duties in planning, maintenance and new construction.
I would like to request the Board's authorization to begin the process of filling two of
these four vacant positions. Specifically, I would like to hire another engineer to help
oversee our Developer activity and also to coordinate all of our activities related to the
street and storm drain projects that are being undertaken by the Cities of Highland and
San Bernardino. The City of Highland has been especially aggressive with their street
improvement projects. This has required a tremendous amount of time from our staff to
coordinate these improvements with our existing facilities. I would also like to fill one of
our three vacant Water Service Worker positions. We also have a very aggressive list of
public improvement projects that we have undertaken. In addition, we have all of the
normal maintenance and repair activities that must continue on a daily basis.
The District's 2010 -2011 budget assumes a full complement of employees. The filling of
these two positions will not, therefore, require a budgetary adjustment. If approved, the
actual process to recruit, interview and hire these new employees will take several
months. Your consideration of this request is appreciated.
�EastValley
Water District
Board Memorandum No. B -01 -2011 Date: January 4, 2011
From: Ron Buchwald, PE
Subject: Plant 150 Ion Exchange Systems Supplier
Recommendation: Award the Ion Exchange System to Calgon Carbon Corporation
Background:
On December 14, 2010, the Board authorized the District to enter into an
agreement with CDM to complete the final design for the Plant 150 Centralized
Treatment Plant. This new treatment plant will allow the District to efficiently treat
for perchlorate from three Wells (11A, 12A and 28A) at a single site as well as
allow the District to be prepared for potential future contaminants and
expand /replace old and worn out booster stations, reservoirs and appurtenances.
In order to complete the final design, CDM needs to know the specifics of the
equipment that will be used in the ion exchange (IX) process. CDM's opinion of
probable cost for the ion exchange system is 3.1 million dollars.
On July 27, 2010, invitations for proposals were sent to four previously qualified
Ion Exchange System Suppliers. They were Tonka Equipment Company,
Calgon Carbon Corporation, Envirogen Technologies, and Layne Christensen
Company. On September 8, 2010, the sealed bids were open. Of the four
invitations that were sent out only three bids were received, Layne Christensen
Company chose not to submit a bid. Of the three bids that were received,
Calgon Carbon Corporation was the apparent low bidder at $2,269,605.00,
followed by Envirogen Technologies ($2,350,000.00) and Tonka Equipment
Company ($2,530,000.00). After completing a comprehensive evaluation of the
three bids, CDM found that all three bids met the bidding requirements and
considered them all acceptable. CDM also found that, within the past 5 years,
only Calgon Carbon Corporation (CCC) has supplied IX systems to four projects
that were similar in size and design as the proposed Plant 150 project. The
references that CCC provided also confirmed that CCC was committed to
providing the best system possible and was present during and after
construction, start up and commissioning.
Based on the evaluation that CDM provided, CCC's references, experience and
the fact that they are the low bidder, I recommend the Board awards the IXSS
manufacture contract to Calgon Carbon Corporation.
Fiscal Impact: $2,269,605
Memorandum
To: EVWD
From: CDM — Proposal Review Team: Usingama Mvuemba, Jason
Yoshimura, Sava Nedic
Date: December 30, 2010
Subject: EVWD Plant 150 Ion Exchange Systems Suppliers Proposals
Evaluation
Invitations for Proposals (IFP) were sent to the four previously prequalified Ion Exchange
System Suppliers (IXSS) on July 27, 2010. In addition, two addenda modifying contracts
documents were sent to each IXSS on August 23 and 31, 2010. Table 1 lists the invited IXSSs,
their contact information and their responses to the invitation.
Table 1
Pre - qualified Organizations
IXSs
Contact
Mailing Address
Responses
Tonka Equipment
John Berringan
13305 Watertower Circle
Company
763- 559 -2837
Plymouth MN, 55441
Accepted invitation
Calgon Carbon
Charles Drewry
PO Box 717 Pittsburgh PA,
Corporation
352 -467 -0103
15230 -0717
Accepted invitation
Layne Christensen
Oscar Velastegui
11001 Etiwanda Avenue
Company
909 - 390.2833
Fontana CA 92337
Declined invitation
8740 White Oak Ave.
Envirogen
Bill Schwartz 877-
Rancho Cucamonga, CA
1
Technologies
312- 8950 x120
91730
Accepted invitation
Sealed proposals (bids) were received by the DISTRICT from the following prequalified
IXSS's by the scheduled bid time at 2:00 PM on Monday, September 8,2010:
■ Tonka Equipment Company,
■ Calgon Carbon Corporation,
■ Envirogen Technologies
Layne Christensen Company's representative, Oscar Velastegui, contacted CDM via email on
September 1, 2010 to notify that the company had decided not to bid for this project. Mr.
Velastegui stated that after internal review they did not feel confident of winning and
therefore decided not to bid for the project.
r�
Bid Opening
On September 8, 2010, at 2:00 pm PST, EV WD opened the bids. The bid opening was
witnessed by:
■ Ron Buchwald, PE - EVWD's District Engineer
■ Eliseo Ochoa, PE - EV WD, Assistant District Engineer and Plant 150 Project Manager
■ Mike Henderson - EV WD, Water Production Superintendent
■ Sava Nedic, PE - CDM, Plant 150 Design Project Manager
William Schwartz, PE of Envirogen attended the bid opening as a bidder representative,
The bids for the Plant 150 ]on Exchange System Goods and Special Services were as follows.
■ Tonka Company: $2,530,000
■ Envirogen Technologies: $2,350,000
■ Calgon Carbon Corporation: $2,269,605
The following daily rates for the field services were offered by the three bidders:
■ Tonka Company: $850/ day, plus expenses
• Envirogen Technologies: $850/ day for field service technicians and $975/ day for
engineers
■ Calgon Carbon Corporation: $1,200/ day, plus expenses
Evaluation of Received Bids
A comprehensive evaluation of the received bids has been conducted by CDM's Proposal
Review Team from September 8 through October 4, 2010. Results of this evaluation are
presented in Table 2- Exhibit A attached to tlus Memorandum and summarized as follows:
1. All bids met bidding requirements and are considered acceptable bids
2. All three bidders complied with requirements to use one Df the two pilot tested proven
resins
3. The apparent low bid was the bid submitted by the Calgon Carbon Corporation
4. Within the past 5 years, Calgon Carbon Corporation has supplied three to four IX systems
for Perchlorate removal in Southern California similar in size and design to the Plant 150
project
5. The other two bidders did not offer experience comparable to Calgon for Plant 150
Bid Exceptions and Clarifications
Calgon Carbon Corporation and Envirogen Technologies encompassed their bids with
"Clarifications/ Exceptions to the Contract Documents" and "Exceptions to the Contract
Documents ", respectively. These documents are attached as Exhibits B and C to this
memorandum.
A detailed review of these documents revealed that:
1. The comments presented by the two manufacturers are mainly related to the legal
language to the bid proposal Contract Documents.
2. None of the comments are related to the scope of procurement, neither to the quality or
any other technical provisions of the Bid Documents.
3. Some of the listed comrents and exceptions required a legal review and had a potential
of changing the offered price due to the bid required warranties and liabilities, but none of
them was considered to be outside of reasonable and negotiable contract terns.
Therefore, it was recommended not to count these exceptions against the bidder proposed
prices and to consider the submitted exceptions as starting points for the contract
negotiations. The District had the right to stop negotiations in case the selected bidder comes
to unacceptable contract terms.
Bidders References
A check on the bidder's references confirmed Calgon Carbon Corporation's comrnitment to
their projects during construction and startup activities, as well as for an extended time
period after the project commissioning.
Post Bid Negotiations with Calgon Carbon Corporation
The Calgon Carbon Corporation bid associated "Clarifications/ Exceptions to the Contract
Documents" has been reviewed by the District's legal counsel, and all but spelling and
grammar corrections to the Contract Documents have been rejected.
In the follow up discussions between the DISTRICT and Calgon Carbon Corporation
conducted through the month of December 2010, the Calgon Carbon Corporation dropped all
comments and exceptions and accepted to enter into an Agreement with the District to
provide the IXSS goods and services for Plant P 150 under the terms and conditions as
defined in the IFP and associated addenda for the price of $2,269,605 as proposed in their
original bid.
Recommendations
The CDM Proposal Review Team recommends to the District to select the bid received from
the Calgon Carbon Corporation as the lowest, responsive, responsible bid for the IXSS for the
Plant 150 project.
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EXHIBIT B
Calgon Carbon Corporation
Clarifications/Exceptions to the Contract Documents
CaIgg/ rbon Exhibit B
✓ Making Water and Air
Safer and Cleaner
September 5, 2010
Cierifications /Exception to the Contract Documents for the EVWD Plant 150 RFQ
CCC Proposal Number P -IX -10105
This Bid is conditioned upon the mutually acceptable resolution of the exceptions to Bid
documents noted herein and made a part of this proposal. We therefore respectfully ask for
your consideration of the following:
00500 Provisions of the Goods and Special Services Agreement
1. Section 5.1.8.1 — Please consider modifying the last sentence of this Section and
restated to read as follows:
"it Is understood that the foregoing limitation is a subset of and not in addition to the limitation
of liability set forth in Paragraph 6.1 of Article 6 of this Agreement."
[PLEASE NOTE THAT THE ORIGINAL LANGUAGE REFERENCED A CAP ON LIABILITY
CONTAINED IN SECTION 11.9, HOWEVER THE AGREEMENT DID NOT CONTAIN A
SECTION 11.9.1
2. Section 5.1.6.1 — Please consider modifying the last sentence of this Section and
restated to read as follows:
"It is understood that the foregoing limitation is a subset of and not in addition to the limitation
of liability set forth in Paragraph 6.1 of Article 6 of this Agreement."
[PLEASE NOTE THAT THE ORIGINAL LANGUAGE REFERENCED A CAP ON LIABILITY
CONTAINED IN SECTION 11.9, HOWEVER THE AGREEMENT DID NOT CONTAIN A
SECTION 11.9.1
Cal con Carbon Core oration - 400 Capon Carbon Drwt , Pittsburgh, PA 15205 412 "8 r 6700 - "w.caigonaarban.cam
"ARTICLE 6. LIABILITY
6.1 Notwithstanding anything to the contrary contained herein, the liability of IXSS under
this Agreement (whether by reason of breach of contract, tort, indemnification,
liquidated damages or otherwise) shall not exceed an amount equal to the Contract
price. In no event shall IXSS be liable under or in connection with this Agreement or
the work contemplated hereby for any indirect, special, consequential, incidental,
exemplary or punitive damages (Including without limitation damages for loss of use of
facilities or equipment, loss of revenue, loss of data, loss of profits or loss of goodwill),
regardless of whether IXSS has been informed of the possibility of such damages."
00520 Special Engineering Services Agreement
Section 8.1 — Please consider adding to the end thereof to read as follows:
"It Is understood that the foregoing limitation Is a subset of and not in addition to the limitation
of liability set forth in Paragraph 13,1 of Article 13 of this Agreement,
2. A new Article 13 should be Inserted at the end of this Agreement to read as follows:
Could not find liability language as referenced.
"ARTICLE 13. LIABILITY
13.1 Notwithstanding anything to the contrary contained herein, the liability of IXSS under
this Agreement (whether by reason of breach of contract, tort, indemnification,
liquidated damages or otherwise) shall not exceed an amount equal to the Contract
price. In no event shall IXSS be liable under or in connection with this Agreement or
the work contemplated hereby for any indirect, special, consequential, incidental,
exemplary or punitive damages (Including without limitation damages for loss of use of
facilities or equipment, loss of revenue, loss of data, loss of profits or loss of goodwill),
regardless of whether IXSS has been Informed of the possibility of such damages."
Canton Carbon Corporation - 400 Calton Ceib6n Drive • Pillsburgh. PA 15205 • 412.787.6700 - W".c al[oncarbon.com
00700 Procurement General Conditions
1. Article 1 - Please consider adding to the end of the definition of "Procurement
Agreement" to read as follows:
"Procurement Agreement may also be referred to herein as the "Goods and Special Services
Agreement ", the "Provisions of the Goods and Special Services Agreement" or the Goods and
Services Agreement "."
2. Section 3.2 - Please consider the following: The "." should be deleted after the
"Procurement Documents." at the end of the second line; and the "." should be deleted after
the "a." in the third line.
3. Section 9.7 - Please consider deleting This Section In Its entirety. (if Engineer makes
recommendation and is followed then Engineer is not liable'
4. Section 12.3 - Please consider adding the following provisions to the end of the last
sentence of this Section to read as follows:
"not otherwise excused hereunder."
5. Section 14.4 - Please consider modifying the first sentence of this section and restated
In Its entirety to read as follows:
"Where CONTRACTOR's services have been so terminated by OWNER, the transaction will
not affect any right and remedies of OWNER against CONTRACTOR or CONTRACTOR
against OWNER then existing or which may thereafter accrue. ( comment: this suggestion
makes it equal for both parties)
00800 Supplementary Conditions
f. Section 4.4.C.4 - Please consider modifying This Sw%on and restated to read as
follows:
"4. Include contractual liability Insurance covering the CONTRACTOR's indemnity
obligations."
Calgon Carbon Corporation 400 Calgon Carbon Drive PM001611, PA 15206 i 7E 7.6700 www.calgoncarbon.coni
Section 5.6 — Please consider modifying This Section restated to read as follows:
"Notice of OWNER's acceptance of delivery or deficiencies will be provided to IXSS. if IXSS
does not receive notice of acceptance or deficiencies within 20 days of shipment, such failure
to provide notice to IXSS shall constitute acceptance of the delivered Goods."
Section 7.7.A.2 — Please consider modifying This Section and restated to read as
follows:
"2. That all materials meet the specifications In the Procurement Documents and meet the
requirements for fabrication, shipping, handling, storage, assembly, and installation pertaining
to the furnishing of Goods or Special Services."
4. Section 7.12 -- Please consider adding The following to the end of the first sentence to
read as follows:
"or if such dispute arises out of the OWNER's failure to pay any sums then due and not
subject to a good faith dispute."
7. Section 7.13 — Please consider adding to the end of the first sentence to read as
follows:
", all subject to reasonable confidentiality restrictions and safety requirements Imposed by
CONTRACTOR at the time any access Is sought."
8. Section 7.14.A — We suggest this Section should be amended and restated to read as
follows:
"IXSS shall defend, indemnify and hold OWNER, Including its directors, officers, employees
and agents, harmless from and against any and all claims, demands, causes of action, suits,
debts, obligations, liabilities, losses, damages, costs, expenses, attorney's fees, awards, fines,.
settlements, judgments or losses of whatever nature, character, and description, with respect
to
and arising out of the work to be performed under this Agreement, for death or bodily injury to
one or more persons, Including the employees of IXSS, or Injury to real property, caused by,
C.ilgon Carbon Corpouiion - 400 Ceigoo Carbon Drive - Pittsburgh, PA 15205 - 412.787.6700 - www.uryonurbon,com
or arising out of, any alleged or actual breach of IXSS's obligations under the Procurement
Documents or the negligent act or omission of IXSS, regardless of whether such negligent act
or omission is active or passive, by IXSS or any of IXSS's subcontractors, Including their
respective directors, offi:ers, employees, agents and assigns. Such indemnification
obligations shall be limited to the extent of the negligence or willful misconduct of IXSS or any
of IXSS's subcontractors, determined in accordance with the principles of comparative fault.
9. Section 7.14.0 — Please consider deleting his Sectior in its entirety because it is
covered in 7.14A
10. Section 7.17.A — We suggest amending by deleting 'seven (7) and replacing it with
"three (3)" and further amended by adding the following lanc:!age to the end thereof to read as
follows:
"Notwithstanding anything herein to the contrary, any such audit shall be limited to the
financial records of CONTRACTOR specifically related to this transaction, and shall only be
conducted by an independent accounting firm acceptable to both parties, and if the parties
cannot agree on the auditor, then only by of one of the "Big- Four" accounting firms. The
auditor shall be specifically excluded from reviewing any materials related to the cost of
CONTRACTOR to procure any materials related to the Goods or services provided
hereunder. Any such audit shall be subject to reasonable confidentiality restrictions Imposed
by CONTRACTOR at the time of such audit."
11. Section 7.19.A -- Please consider adding to the end of this Section to read as follows:
"CONTRACTOR shall be under no obligations to disclose any information related to the cost
of CONTRACTOR to procure any materials related to the Goods or services provided
hereunder,
12. Section 7.20.A - In the first sentence of this Section the word "ENGINEER" should be
replaced with "CONTRACTOR ".
13. Section 8,6.A — Please consider adding to the end of '.his Section to read as follows:
"Any such inspection shall be subject to reasonable confidentiality restrictions and safety
requirements imposed by CONTRACTOR at the time of such inspection."
14. Section 8.73 — Please consider deleting the word "or" from the first line of this
Section.
Carson Carbon Corporation 40n Cslgon Carbon Driao Pittsburgh, PA 15205 - 412.'97 C700 www.calgoitcafbon.com
15. Section 8.7.E.2 — Pleases consider amending the last sentence of this Section should
be amended and restated to read as follows:
"In accordance with Article 6 of the Goods and Special Services Agreement, IXSS's total
liability due to the OWNER shall not exceed the amount of the Contract Price."
16. Section 8.8.A — Please consider the following, The phrase 'one (1) year after the date
of the Notice of Substantial Completion" should be replaced with "one (1) year after the date of
the Notice of Substantial Completion or eighteen (18) months after delivery, whichever occurs
first'. (THIS CHANGE IS CONSISTENT WITH THE WARRANTY PROVISIONS UNDER
01740 - WARRANTIES.]
17. Section 9.5 — Please consider modifying the second sentence of this Section and
restated in Its entirety to read as follows:
"ENGINEER'S written decision on such Claim, or dispute, or other matter will be final and
binding upon OWNER and IXSS unless an appeal from ENGINEER's decision is made
thereafter in accordance with applicable law." (THIS CHANGE IS NECESSITATED BY THE
DELETION OF SECTION 15 DEALING WITH DISPUTE RESOLUTION.]
18. Section 10.6 — Please consider modifying this Section by deleting the reference to
"10" and replacing it with a reference to "16" and deleting the reference to "30" and replacing it
with a reference to 645 ". tTHIS CHANGE IS CONSISTENT WITH OTHER PROVISIONS OF
THE AGREEMENT RELATED TO NOTICE PROVISIONS WITH RESPECT TO CHANGES
TO CONTRACT PRICE OR CONTRACT TIMES.]
19. Article 13., Please consider modifying Section F - this Section F, should be re- lettered
to "E ", as the Section goes from "D" to "F ". Also, this entire section should be in all caps to
read as follows:
"F. THE WARRANTIES SET FORTH IN ARTICLE 13 OF THESE SUPPLEMENTARY
CONDITIONS, AND IN ARTICLE 1.03 AND 1.04 OF SECTION 01740 OF THE CONTRACT
DOCUMENTS, ARE IXSS'S SOLE AND EXCLUSIVE WARRANTIES. IXSS MAKES NO
OTHER WARRANTIES OF ANY KIND WHATSOEVER, EXPRESS OR IMPLIED,
INCLUDING WITHOUT LIMITATION ANY IMPLIED WARRANTY OF MERCHANTABILITY
OR FITNESS FOR A PARTICULAR PURPOSE OR WARRANTIES ARISING BY CUSTOM
OR TRADE USAGE.
calaon ca ban Corporation • 400 Calaon Carbon Drive , Phlsburah, PA 15205 - 412,187.6700 - wwsv.oalgoaurbon.00m
20. Section 14.73.2.b — Please consider modifying this Section to add the following to the
end thereof to read as follows:
"and such proceeding remains eitheruucontested for fifteen (1 5) days or undlslmssed or unstayed
and in effect fbr a period of sixty (60) (lays."
01740 Warranties
1. Section 1.03.A.2 -This is very broad and open -ended performance warranty. We
respectfully request this to be more narrowly defined with reference to specific specifications
sections and should contain applicable assumptions and qualifications with respect to flow
rates, loading rates and surface contact rates.
Section 1.03.6.1 — Suggested bed life warranty language.
Bed Life Warranty Shortfall due to porchlorate leakage above 4 ppb of treated water
With the following conditions, 1) resin shall not have fouling caused by precipitation from the raw water;
2) resin beds shall not have build up of suspended solids from raw water, 3) system shall be operated
within parameters as set forth in the O&M; 4) WQ shall remain within the parameters as set forth in the
RFQ.
Remedies for warranty usage will be provided in the form of future goods and services..
Remedies will be linearly prorated based on the volume of water Treated. (i.e. if bed life
warranty is 100 acre feet for the lead bed, but only 90 acre feet (or 90 %) are processed before
changeout is required , then the cost for the changeout will only be 90% of the changeout cost.)
Bed Life Warranty Shortfall due to high pressure drop
With the following conditions, 1) resin shall not have fouling caused by precipitation from the raw water;
2) resin beds shall not have build up of suspended solids from raw water.
Remedies for warranty usage will be provided in the form of future goods an([ services,
Remedies will be linearly prorated based on the volume of wa(cr treated (i.e. if bed life
warranty is 100 acre feet for the lead bed, but only 90 acre feet (ar 90 %) are processed before
changeout is required, then the cost for the changeout will only be 90% of the changeout cost.
Calgon Carbon CorDOrallon 40C Calgon Carbon Drive Pillabmgh, PA 15205 - 41 7 3 87 6700 www.calgontafbon.coni
Exhibit C
East Valley Water District Plant '150Ion Exchange System for Perchlorate Removal
Facilities Layout
The proposed design and integration into CDM facility layout drawings are shown in Appendix G. This
design mirrors the design shown by CDM and will meet all the dimensional requirements. Additional details
will be provided under the Saeciai Engineering Services portion of this propcsa!
Exceptions to Contract Documents
Envirogen submits its response to this IFP subject to negotiation Wth EVWD regarding the following
additions, supplementation and exceptions to the Procurement General Conditions (Section 00500) and
Supplementary Conditions (Section 00800) and mutual agreement as to contract language modifications
regarding the same,
Whenever terms are used to described actions by either the Owner or Engineers such as "as
ordered", 'as directed', "as required", 'as allowed', "as approved ", or terms of like effect or import
are used, or the adjectives/nouns/verbs such as "acceptable ", 'proper', 'satisfactory",
.satisfaction', 'necessary", "determine*, 'opinions', "verify" or words of like effect or import are used
to describe requirement, direction, review or judgment of the Engineer or Owner, It is intended that
such requirement, direction, review or judgment will be modified by the term "reasonable'. The use
of any such term, verb, noun or adjective should never indicate that Engineer or Owner have any
final determination which is not reviewable by Courts as to reasonacleness.
In Section 6.8.2, it should be made clear that only those claims which are known are being limited,
Indemnification (7.14(A),(C)j should be based on negligence, Wilful misconduct and breach of
contract. it must be mutual and comparative. Section 7.4(D) should be deleted. For purposes of
indemnification, Owner should be liable for the acts and omissions of the Engineer.
Section 9.4 should be modified to clarify that the adjective "initial' modified both Engineer's
interpretation and judgment.
Specifically, any decislon of the Engineer under either Section 9.4 or 9.5 is advisory - not binding.
Generally, in no event shall Engineer's decisions or judgments uncer the agreement be binding on
either party even if the language suggests that the Engineer is the "sole judge'.
Any attempt In the general conditions to limit the time within which Envirogen may enforce a
contract right to a period of time less than that afforded under California's laws and regulations
governing statues of limitations should be removed. Thus, as an examole, under Section 11.2 the
15 -day limitation would not be applicable.
Anything in the contract documents to the contrary notwithstanding, neither party should be liable
for indirect or consequential damages. (See for example Section 13.8.)
Venue for all the determination of any dispute which is not mutually resolved by the parties should
be with the Superior Court for the County of San Bernardino.
Engineer shall not be considered a third -party beneficiary of the agreement between Owner and
Envlrogen for any reason.
In any litigation, the prevailing party shall be awarded its attorney's tees and other costs of suit.
There should be included within the general conditions a provision crotecting the parties against
force majeure events.
Project No. WR158 Page 8
September 8, 20110 Enviiaje:i Tedmobpu Cwfdenlel- Pads SetrOWd Proprielayl do maFxi
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EAST VALLEY WATER DISTRICT
DIRECTOR'S FEES AND EXPENSE REPORT
DIRECTOR
Larry Malmberg
MONTH December, 2010
Board Meetings
*12-14-10; *12-28-10
Conferences and Other Meetings
DATE
ORGANIZATION
PURPOSE
1 -Dec
*SBACC
San Bernardino Chamber of Commerce Koffee Klatch
2 -Dec
EVWD
Sign checks at EVWD
6 -Dec
*SBVWD
SB Valley WD Basin Tech. Adv. Committee meeting.
7 -Dec
* Dr. Mathis
Meeting with Dr. Mathis in Rancho Cucamonga
8 -Dec
*SBACC
San Bernardino Chamber of Commerce Koffee Klatch
8 -Dec
EVWD
ERNIE Meeting at EVWD
10 -Dec
*SBVMWD
District tour.
11 -Dec
*EVWD
District Annual Employee's Awards
13 -Dec
*CSDA
CA Special Districts Association meeting.
17 -Dec
*EVWD
JPA Ad Hoc Committee Meeting
TOTAL # OF MEETINGS 10@ $175.00 each $ 1750.00
Travel Expenses: (Details on Back)
$ 21.00
Total Director's Meetings & Expenses $ 1771.00
Director's Signature
Date of
Board Approval
Administrative
Manager
Miscellaneous
Notes
Less Any Advance Payments $
TOTAL DUE DIRECTOR $ 1771.00
TRAVEL EXPENSES
Lodgings: (Detailed receipts attached *)
DATE FUNCTION ATTENDED AMOUNT
TOTAL LODGING $
Personal Auto: (Detailed receipts attached *)
PARKING
DATE FUNCTION ATTENDED MILES FEES
7 -Dec Meeting with Dr. Mathis in Rancho Cucamonga 42 $
$
TOTALFEES
$
CURRENT RATE: $0.50
TOTAL MILES 42
$
21.00
Meals: (Detailed receipts attached *)
DATE
FUNCTION ATTENDED
AMOUNT
TOTAL MEALS
$
Other: (Detailed receipts attached *)
DATE
FUNCTION ATTENDED
AMOUNT
TOTAL OTHER
$
* ORIGINAL RECEIPTS REQUIRED
TRAVEL EXPENSES
$
21
EAST VALLEY WATER DISTRICT
DIRECTOR'S FEES AND EXPENSE REPORT
DIRECTOR Matt Le Vesque MONTH Devember, , 2010
Board Meetings Dec. 14, Dec. 28
Conferences and Other Meetings
DATE
1 -Dec
2 -Dec
7 -Dec
8 -Dec
10 -Dec
13 -Dec
16 -Dec
20 -Dec
21 -Dec
22 -Dec.
ORGANIZATION PURPOSE
ACWA Meetings /Exhibit Vendors
ACWA Discussion Panel re. GM Comp.
Inland Action
Highland Chamber
Valley District
ASBCSD
SB Chamber
Highland Chamber
SBVMWD
Inland Water Works
Travel Expenses: (Details on Back)
Director's Signature
Date of
Board Approval
Administrative
Manager
Miscellaneous
Notes
Reaular Meetin
Joint Dinner w/ Mentone
Facilities Tour
Monthly Meeting - SAS
Chamber Open House
Chamber Open House
Regular Meeting
Hydrant/Fountain
TOTAL # OF MEETINGS 9 @ $175.00 each $ 1575.00
$ 133.93
Total Director's Meetings & Expenses $ 1708.93
Less Any Advance Payments $
TOTAL DUE DIRECTOR $ 1708.93
TRAVEL EXPENSES
Lodgings: (Detailed receipts attached *)
DATE FUNCTION ATTENDED
Personal Auto: (Detailed receipts attached *)
DATE FUNCTION ATTENDED
2 -Dec ACWA —
AMOUNT
R
TOTAL LODGING $
PARKING
MILES FEES
142 $
TOTAL FEES $
CURRENT RATE: $0.50 TOTAL MILES 142 $
Meals: (Detailed receipts attached *)
DATE FUNCTION ATTENDED
71.00
AMOUNT
2 -Dec ACWA $ 27.93
13 -Dec ASBCSD $ 35
TOTAL MEALS $ 62.93
Other: (Detailed receipts attached *)
DATE FUNCTION ATTENDED AMOUNT
TOTAL OTHER $
` ORIGINAL RECEIPTS REQUIRED TRAVEL EXPENSES $ 133.93
EAST VALLEY WATER DISTRICT
DIRECTOR'S FEES AND EXPENSE REPORT
DIRECTOR: _Morales MONTH December 2010
Board Meetings: 14, 28
Conferences and Other Meetings
DATE ORGANIZATION
12 -02 CA State Legislature
12 -03 SB City Council_
12 -15 EVWD
12 -16 H101and_Chamber
12 -17 %MD
11 -03 I rMD
Travel Expenses: (Details on
Director's Signature
Date of Board Approval
EVWD Ew DEC 2010.dw
PURPOSE
Senator Dutton (ESRI)
Proposition 218 (SB City proposed sewer rate increase)
SB City Sewer JPA Review (General Manager)
'Business Open Event
�_JP "tRlrlew- Ad Hoc Committee _
P ej+Co*tt —
t ...
Policy Comm, iitee (oversight, not included on 11/2010 report) _
TOTAL # OF MEETINGS
9_ @ $175.00 each $1,575.00__
Total Director's Expenses $20.00
Total Director's Meetings & Expenses $1,595.00__
Less any Advance Payments
TOTAL DUE DIRECTOR $1,595.00
TRAVEL EXPENSES
Lodgings: (Detailed receipts attached')
DATE FUNCTION ATTENDED
TOTAL LODGING $
Personal Auto: (Detailed receipts attached*)
DATE FUNCTION ATTENDED MILES
TOTAL MILES
TOTALFEES
x $.50 per mile
AMOUNT
PARKING FEES
Meals: (Detailed receipts attached')
DATE FUNCTION ATTENDED AMOUNT
TOTAL MEALS
Other: (Detailed receipts attached')
DATE FUNCTION ATTENDED AMOUNT
12 -02 Dutton Event Registration $20.00
TOTAL OTHER $20.00
' ORIGINAL RECEIPTS REQUIRED
TRAVEL EXPENSES $20.00
(Enter this total on the front of form)
DIRECTOR
Board Meetings
EAST VALLEY WATER DISTRICT
DIRECTOR'S FEES AND EXPENSE REPORT
Sturgeon MONTH Dec. ,2010
14 & 28
Conferences and Other Meetings
DATE
ORGANIZATION
PURPOSE
01
ACWA
Conference
13
SBCSDA
Meeting
14
City of Highland
City Council Meeting
21
SBVMWD
Meeting
20
EVWD
Policy Committee
20
SBVMWD
Meeting
23
SBVWMD
Meeting
Travel Expenses: (Details on Back)
Director's Signature
Date of
Board Approval 01/11/11
Administrative
Manager
Miscellaneous
Notes
TOTAL # OF MEETINGS 6 @ $175.00 each $ 1,050. 00
$ 69.49
Total Director's Meetings & Expenses $ 1,119 . 4 9
Less Any Advance Payments $
TOTAL DUE DIRECTOR$ 1,119.49
TRAVEL EXPENSES
Lodgings: (Detailed receipts attached -)
DATE FUNCTION ATTENDED
Personal Auto: (Detailed receipts attached')
DATE FUNCTION ATTENDED
CURRENT RATE: $0.50 TOTAL MILES
Meals. (Detailed receipts attached -)
DATE FUNCTION ATTENDED
Reimburse
o \
Z
�v
U
AMOUNT
TOTAL LODGING $
PARKING
MILES FEES
e
TOTAL FEES $
$
AMOUNT
$ 16.00 -
$
TOTAL MEALS $
Other: (Detailed receipts attached')
DATE FUNCTION ATTENDED AMOUNT
11/30 - 12/01 ACWA Gasoline $ 40.00
13/13 SBCSDA $ 37.00
11/03 Water Education Foundation Velcro for EVWD Booth $ 8.49
TOTAL OTHER $ 85.49
' ORIGINAL RECEIPTS REQUIRED TRAVEL EXPENSES $ 69.49
EAST VALLEY WATER DISTRICT
DIRECTOR'S FEES AND EXPENSE REPORT
DIRECTOR
Wilson
Board Meetings
12/14; 12/28
Conferences and Other Meetings
DATE
ORGANIZATION
12/1 -12/2
ACWA
4 -Dec
Ymca Highland Red Hat Soc
7 -Dec
SBVMWD
9 -Dec
USAWRA
10 -Dec
SCVMWD
20 -Dec
Highland COC
22 -Dec
EVWD
Travel Expenses: (Details on Back)
Director's Signature l
0
Date of
Board Approval
Administrative
Manager
Miscellaneous
Notes
MONTH Dec 2010
PURPOSE
Fall Conference
Childrens' Christmas Parade
Board Mt
Monthly Mtg.
Facilties Briefing & Tour
Monthly Luncheon
Draft Audit Review
TOTAL # OF MEETINGS 10@? $175.00
each $ 1750.00
$ 772.00
Total Director's Meetings & Expenses $ 2522.00
Less Any Advance Payments $
TOTAL DUE DIRECTOR $ 2522.00
TRAVEL EXPENSES
Lodgings: (Detailed receipts attached`)
DATE FUNCTION ATTENDED AMOUNT
0_no, ACWA Conference $ 722
TOTAL LODGING $ 722.00
Personal Auto: (Detailed receipts attached')
PARKING
DATE FUNCTION ATTENDED MILES FEES
11/29 -12/2 ACWA Conference 100 $
TOTAL FEES $
CURRENT RATE: $0.50 TOTAL MILES 100 $
Meals: (Detailed receipts attached`)
DATE FUNCTION ATTENDED AMOUNT
TOTAL MEALS $
Other: (Detailed receipts attached -)
DATE FUNCTION ATTENDED AMOUNT
$
$
TOTAL OTHER $
*ORIGINAL RECEIPTS REQUIRED TRAVEL EXPENSES $ 772
East Valley Water District
Highland, California
Annual Financial Report
For the fiscal year ended June 30, 2010
East Valley Water District
Annual Financial Report
For the year ending June 30, 2010
Table of Contents
History and Organization 1
Independent Auditors' Report 2
Management's Discussion and Analysis 3
Financial Statements:
Statements of Net Assets 11
Statements of Revenues, Expenses and Changes in Net Assets 13
Statements of Cash Flows 15
Notes to the Financial Statements 17
Auditors' Report on Supplementary Information 35
Supplementary Information:
Schedule One - Water Department 36
Schedule Two - Sewer Department 41
Schedule Three - Schedule of Capital Assets 44
Schedule Four - Schedule of Changes in Capital Assets 47
Schedule Five - Unredeemed Bond Coupons 50
Schedule Six - Principal and Interest Repayment Schedules 51
Statement of Net Assets Comments 55
Water Operations 60
Sewer Operations 61
-1-
East Valley Water District
History and Organization
For the year ending June 30, 2010
Formation of the District
The Board of Supervisors of San Bernardino County approved a petition in writing for the formation of the East
Valley Water District (formerly, East San Bernardino County Water District) under Division 12 of the Water Code
of the State of California and ordered an election held January 12, 1954. The formation of the District was voted
by the electors. The Board of Supervisors of San Bernardino County, by action on January 18, 1954, approved
the formation of the District. Incorporation of the "East Valley Water District" was approved by the State of
California on February 1, 1954.
Formation of the Public Facilities Corporation
The East Valley Public Facilities Corporation was incorporated October 1986, pursuant to the nonprofit public
benefit corporation law of the State of California to provide financial assistance to the District by acquiring and
constructing various public improvements, and by acquiring land and related facilities for the use, benefit and
enjoyment of the public.
Nature of Business
The District has been engaged in the furnishing of water service and sewage transmission services to its
customers since inception.
Location
The District has temporarily relocated its office to 3654 East Highland Avenue. The office is situated within the
District's boundaries which encompass an area of approximately 25 square miles within the County of San
Bernardino, California.
Directors
WATER DISTRICT PUBLIC FACILITIES CORPORATION
George E. "Skip" Wilson President Kip E. Sturgeon President
Kip E. Sturgeon Vice-President George E. "Skip" Wilson 1st Vice-President
Matt Le Vesque Director Matt Le Vesque 2nd Vice-President
James Morales, Jr. Director Robert E. Martin Secretary
Larry Malmberg Director Brian W. Tompkins Treasurer
Mangement
Robert E. Martin General Manager/Secretary
Brian W. Tompkins Chief Financial Officer/Treasurer
Professional Consultants
General Counsel for the District is the firm of Brunick, McElhaney & Beckett.
EAST VALLEY WATER DISTRICT
MANAGEMENT’S DISCUSSION AND ANALYSIS
-4-
The decrease in total assets was primarily in
two asset categories: restricted assets and
capital assets. Restricted cash balances fell
as 1) restricted project fund cash was
depleted to continue progress on the design
of treatment plan upgrades on the District’s
plant 134, and 2) a sinking fund for the
repayment of 1996 COPs was no longer
needed when the 1996 COPs were retired in
December 2009.
The decrease in capital assets is the result
of depreciation expense for the year
exceeding capital spending. With the
exception of design and ongoing GIS
implementation, capital spending was
substantially deferred while the District staff
worked to finalize low-interest loans and
grants from the State of California's
Department of Water Resources, as well as
issue bonds.
Condensed Statement of Net Assets
(in millions)
6/30/10 6/30/09
Current Assets 8.8 9.1
Restricted Assets 2.3 3.5
Capital Assets-Net 112.6 113.6
Other Assets .2 .3
Total Assets 123.9 126.5
Current Liabilities 5.3 6.1
Curr Liab Payable from
Restricted Assets 1.8 1.8
Long-Term Debt 17.8 19.1
Total Liabilities 24.9 27.0
Net Assets
Invested in Capital
Assets 93.4 93.4
Unrestricted 5.6 6.1
Total Net Assets 99.0 99.5
Current assets also decreased by $340
thousand as reimbursements related to a
large, externally funded pipeline were
collected and also inventory levels were
allowed to fall. At the same time, current
liabilities fell $840 thousand, due primarily to
refunding of debt and, as a result, the
current ratio at June 30, 2010 is 1.66:1
compared to 1.49:1 at the end of the
previous fiscal year.
The District’s Net Assets totaled $99.0
million at the end of fiscal year 2010, a $400
thousand (4%) decrease from net assets at
the end of the previous fiscal year. The
decrease in Net Assets consisted of
operating income of $400 thousand, net
non-operating expenses of $900 thousand,
and net contributions of cash from
developers of $100 thousand.
$93.3 million of the $99.0 million (94.3%) in
Net Assets at June 30, 2010 was invested in
capital assets with the remaining $5.7 million
classified as unrestricted. The District Board
of Directors has designated $2.1 of the $5.7
million in Unrestricted Net Assets as an
emergency reserve that can only be spent
with authorization from the Board.
The decrease in net assets of $400
thousand was offset by a greater decrease
in liabilities, allowing the District’s debt to
equity ratio to improve from 27.2% to 25.1%.
Activities and Changes In Net Assets
Water Operations
The following discussion of water revenues
involves analysis after the effect of a prior
period adjustment to previously reported
water sales as explained in Note 11 to the
financial statements.
East Valley Water District produced and sold
19,803 acre-feet of water during the 2009-
2010 fiscal year, 1,579 acre feet (7.4%)
fewer than in the prior year. This significant
decrease in volume of water sold, offset by
the effect of a full year of rate increase that
became effective in December 2008,
resulted in substantially no change in sales
(.02% increase) which remained at $11.6
million. Total water operating revenues
were $15.2 million, down (0.6%) from $15.3
million in the previous fiscal year.
Factors affecting the drop in water sold
include the unstable economy, which
caused some customers to implement self-
imposed conservation, and above-average
rainfall during the 12 months ended June 30,
EAST VALLEY WATER DISTRICT
MANAGEMENT’S DISCUSSION AND ANALYSIS
-5-
2010. Between July 2009 and June 2010,
rainfall for the area was 17.71 inches,
compared to the period July 2008 to June
2009, during which rainfall was only 10.56
inches, a 40% increase between years.
Average rainfall for the District’s service
area is approximately 16 inches per year.
Monthly meter charges, which were also
affected by the 2008 rate increase, rose
3.8% to $3.2 million, helping to stabilize
water operating revenue and limit the
decrease in total water operating revenue to
(0.6%).
Water department operating costs, before
general and administrative expenses, rose
4.9% to $7.3 million. After administrative
and general costs of $4.6 million, and
depreciation of $2.7 million, water
department operating income was $.6
million.
Various factors affected increased water
department operating costs in 2009-2010.
The most significant were in the Production
cost centers of Source of Supply and
Treatment.
Source of supply cost increases were
related to District efforts to supplement
future water supplies. First, the District
budgeted a purchase of State Water Project
water for basin replenishment that had been
made available at a very low cost per acre-
foot. In addition, assessments on shares of
stock the District holds in North Fork Water
Company were higher than expected as the
company accelerated the start date on a
pipeline replacement project.
Contracted water treatment costs utilizing
mobile treatment units rose 5% to $990
thousand in fiscal year 2009-10. Different
factors affected the change from the
previous year.
First, the per acre-foot charges for water
treated by leased treatment units rose to
$486.34 due to scheduled inflationary
adjustments. The affect of this adjustment
was limited, however, by activation of two
additional treatment units at the District’s
Plant 40. The new units, one for treatment
of uranium and the other for nitrates, were
purchased rather than leased, and are
therefore subject to a lower per acre-foot
charge designed to cover the costs of
consumables as outlined in water service
agreements. In 2009-10 the District treated
562.0 acre-feet of water with the uranium
unit at a cost of $125 and 480.6 acre-feet of
water for nitrates at a cost of $289 per AF.
Combined costs paid to operate the two
units in 2009-10 was $209 thousand.
Water Dept. Operating
Revenue versus Expenses
11,000,000
12,000,000
13,000,000
14,000,000
15,000,000
16,000,000
2007 2008 2009 2010
Revenue Expenses
Sewer Operations
Sewer operating revenues consist of System
charges and Treatment Charges.
System charge rates are set by the District
to cover the cost of maintaining the District’s
wastewater collection system and to cover a
portion of administrative and general
expenses.
Treatment charge rates are established by
the City of San Bernardino Water
Department, which treats the wastewater
produced by the District’s customers – the
District has no sewer treatment facilities. All
sewer treatment revenues collected by the
District are directly offset by payments to the
City of San Bernardino Water Department;
therefore, sewer treatment has no net effect
on the District’s operating results.
Sewer operating revenues remained
substantially the same at $9.2 million (0.2%
decrease) when compared to the prior fiscal
year. Sewer system charges increased
3.0% to $3.5 million, due primarily to an
increase in the District’s sewer system rates
EAST VALLEY WATER DISTRICT
MANAGEMENT’S DISCUSSION AND ANALYSIS
-6-
in December 2008. This increase, however,
was offset by a decrease in Other Sewer
Charges. The decrease is the result of a
change in allocation of collection charges,
such as delinquent fees and disconnection
charges. These charges are now
substantially all allocated to the Water
Department as Water maintains all utility
receivables and the related responsibility for
their collection.
Decreased water consumption by
commercial customers had a slight effect
counter to the rate increase as these
customers are billed for their use of the
sewer system based on units of water used
and water usage.
Sewer department operating costs consist of
wastewater collection line maintenance,
treatment charges paid to the City of San
Bernardino Water Department and customer
account maintenance. During 2009-10,
these costs increased 4.2% to $6.6 million.
After administrative and general costs of
$2.2 million, and depreciation of $0.6 million,
the sewer department operating loss was
$0.2 million.
Collection line maintenance increased by
7% as the District began performing spot
repairs on broken sewer mains based on
ongoing video inspections of sewer mains in
accordance with new mandates. As of June
30, 2010, about 55% of district sewer mains
had been inspected and 33 repairs had
been performed at an average cost of
$5,000.
Sewer Dept. Operating
Revenue versus Expenses
8,000,000
8,500,000
9,000,000
9,500,000
2007 2008 2009 2010
Revenue Expenses
Administrative and general costs increased
5.3% overall to $6.8 million. Significant
changes in general and administrative costs
included:
1) Year 3 (final year) of a phased
implementation of an independent
salary survey which resulted in
significant increases for many salary
classifications, and
2) Increased pension contributions due to
increased wages.
The District currently has a hiring freeze in
order to help control administrative and
general costs.
Non-Operating Activities
The District’s net non-operating expense of
$919 thousand reflects a 5.6% decline in
non-operating activity. This deficit was the
result of a significant decrease in non-
operating income offset by a lesser
decrease in non-operating expenses.
Investment earnings decreased as yields on
investments continued to fall. The
Apportionment rate paid by the California
Local Agency Investment Fund fell by more
than half, from 1.51% to 0.56% during the
fiscal year, while the decrease in yields on
Treasury and Agency bonds purchased for
the District’s portfolio was very similar.
Non-operating expenses fell primarily due to
a decrease in interest expense. The District
continued to make timely payments on long-
term debt obligations, retiring one COP
issue in December 2009, and as a result
paid 10% less in interest during 2009-10.
Condensed Statement of Revenue,
Expenses and Changes in Net Assets
(in millions)
6/30/10 6/30/09
Water Revenues 15.2 15.7
Water Oper. Exp.(14.6) (14.3)
Sewer Services 9.2 9.1
Sewer Oper. Exp.(9.4) (8.7)
EAST VALLEY WATER DISTRICT
MANAGEMENT’S DISCUSSION AND ANALYSIS
-7-
Non Oper. Rev. .2 .4
Non Oper. Exp. (1.1)(1.2)
Developer Contrib. .1 .8
Grant Funds -1.8
Water Co. Transfers -(.8)
Change in Net Assets (.4)2.8
Capital Contributions and Transfers
Developer fees fell to $97.5 thousand, just
25% of total fees collected in the prior year
as developers slowed their work in progress
during the economic downturn. Further, no
facilities or water/sewer infrastructure, the
result of housing tracts being installed by
developers, were dedicated to the District
during the 2009-10 fiscal year.
Categories of Net Assets
The District is required to present its net
assets in three categories: Invested in
Capital Assets, Restricted, and Unrestricted.
Invested in Capital Assets
At June 30, 2010, Invested in Capital Assets
included Utility Plant in Service and
Construction in Progress of $161.0 million,
less Accumulated Depreciation of $48.4
million, for a net utility plant amount of
$112.6 million. This amount is reduced by
$19.4 million in Long-Term Debt, net of
discounts and refunding deferrals of $0.2
million, to derive an Invested in Capital
Assets balance of $93.4 million.
Restricted
The District had no restricted net assets at
June 30, 2010. During the 2009-10 year the
District did receive capacity fees of $97,503
that by law are restricted for use on plant
expansion capital projects, or debt service
on such projects. However, expenditures for
these purposes exceeded the fees collected
resulting in no Restricted Net Assets at year-
end.
Unrestricted
EVWD had unrestricted Net Assets of $5.7
million at June 30, 2010. Of that amount,
the board of directors has designated $2.1
million as an emergency reserve.
Capital Assets
The District spent approximately $3.5 million
for expansion or replacement of property,
plant, and equipment during 2009-2010.
These amounts are reflected in Utility Plant,
or as additions to Construction In Progress,
in the accompanying financial statements.
Following is a discussion of the facilities and
equipment constructed and purchased.
Placed In Service
During the 2009-2010 fiscal year, District
crew and contractors completed work on the
following:
Plant 40 – installation of mobile
Uranium and Nitrate treatment units
Plant 40 – complete rehabilitation of
well and pumping equipment
Replacement of 3,140 feet of 8”
mains serving residential areas
Utility Plant in Service – June 30th
(in millions)
Department 2010 2009
Water
Source of Supply 12.2 11.7
Pumping 8.5 8.5
Transmission &
Distribution 77.4 76.6
Treatment 12.0 9.7
Wastewater
Collection Lines 23.7 23.4
General
Bldgs & Improv 1.3 1.2
Equipment 6.8 7.1
Total 141.9 138.2
EAST VALLEY WATER DISTRICT
MANAGEMENT’S DISCUSSION AND ANALYSIS
-8-
Construction In Progress (CIP)
Construction in progress decreased $11.0
million to $5.1 million between June 30,
2009 and June 30, 2010. With
approximately 40 jobs in progress, additions
to CIP totaled $2.7 million, while $13.7
million was transferred out. Approximately
half of the costs removed from CIP were
related to land purchased for future
headquarters facilities, with the balance
consisting of completed jobs that were either
capitalized or expensed.
More than 82% of costs in CIP at June 30,
2010 were incurred on 3 projects. These
are:
Land acquisition, planning and
design of Plant 150, a perchlorate
treatment plant in the District’s
lower pressure zone
Implementation of GIS – conversion
of District facility maps to digital
format
Design of the upgrade and
expansion of the District’s surface
water treatment plant (Plant 134)
Construction on Plant 134 is expected to
begin in December 2010. This project was
made necessary by passage of new water
regulations known as Stage 2 of the
Disinfectant By-Product (DBP) Rule, which
placed stricter limits on the DBPs
discharged from Plant 134, the District's only
surface water treatment plant. Studies
performed by an independent engineering
firm revealed that retrofitting the plant’s
treatment technology would be required,
with a membrane filtration system
recommended. The deadline for compliance
with new DBP Rule is October 2012.
The District will also use the period of
construction for the Plant 134 upgrade to
increase the plant’s capacity from 4mgd to
8mgd. The additional plant capacity will
improve supply to three of the District’s
higher pressure zones.
Estimated cost of the project is $13 million
with up to $10.0 million reimbursable by
grants and 0% interest loans – see
discussion of long-term debt.
Future Capital Improvements - Water
The District’s ability to meet regulatory
requirements and to meet increased
demand on system capacity continue to be
the driving forces by which District
management develops long-term capital
plans.
Future water capacity challenges were
addressed in the District’s Water Master
Plan (WMP) update issued in January 2008.
The primary challenge identified in the WMP
is to transport water from wells in the
District’s lower zone, where water is
plentiful, to higher-pressure zones where it
is expected large parcels of land will be
developed, creating a demand for water that
will exceed sources to those zones.
Key facilities to be built over the next five
years to implement phase one of interzone
water transferability are:
Plant 150 – lower zone treatment
plant construction
Pipelines connecting lower zone
wells to Plant 150
Pipelines to complete a connection
between Plant 150 and Plant 40 in
the Intermediate pressure zone
Plant 40 boosters
Future Capital Improvements - Wastewater
As discussed above, the District is currently
using video surveillance in order to inspect
and assess all 250 miles of its wastewater
collections lines in accordance with
California State Water Resources Control
Board order no. 2006-0003.
Pipes identified as damaged, and at risk of
sewer spills or seepage that can
contaminate surface or ground waters, are
being repaired in one of two ways: damage
to a small section of pipe is repaired by
replacing that section, while longer sections
of damaged pipe are repaired with a liner.
EAST VALLEY WATER DISTRICT
MANAGEMENT’S DISCUSSION AND ANALYSIS
-9-
Pipelines that are assessed as undersized
are further monitored for flows. If flow
monitoring confirms a pipeline is nearing
capacity, it is placed on a schedule for
replacement. Very preliminary estimates of
the costs for pipeline replacements over the
next five to ten years range from $7 to $17
million.
One project already identified will replace a
6” sewer main with 10” pipe to alleviate
concerns that high flows will exceed
capacity of the existing pipe. The project
has an estimated cost of $485 thousand and
expected to begin in December 2010.
Long-Term Debt / Credit
The District’s long-term debt consists of a
2001 series of Certificates of Participation
(COPs), two privately placed Installment
Sale Agreement (ISA) contracts with a bank,
and a construction loan from the California
Department of Water Resources.
Outstanding balances as of June 30, 2010
were as follows:
2001 COPs $ 5,935,000
DWR Construction Loan 138,623
2004 Install Sale Agrmt 8,067,777
2006 Install Sale Agrmt 5,218,703
$ 19,360,103
The DWR loan is ultimately the obligation of
property owners within the Arroyo Verde
Assessment District, previously a small
mutual water company operating within the
District’s service area.
All scheduled debt payments were timely
made during the fiscal year.
Outstanding Long-Term Debt June
30th
-
5,000,000
10,000,000
15,000,000
20,000,000
25,000,000
2007 2008 2009 2010
1996 COPs 2001 COPs 2004 ISA 2006 ISA
On October 28th, 2010, the District issued
2010 Refunding Revenue Bonds in the
amount of $33,545,000. Part of the
proceeds from the bonds will be used to pay
off the 2004 and 2006 ISAs and to refund
the 2001 COPs.
A summary amortization schedule and the
sources and uses of funds related to the
2010 bond issue are included in Note 12 of
these financial statements.
Standard & Poors and Fitch rated the 2010
bonds at the time of issuance. Both
agencies gave the bonds a rating of AA-.
Dun & Bradstreet, based on audited
financial statements and creditor input, also
rates the District. The rating given by D&B
is currently 5A1 accompanied by a financial
condition assessment of ‘strong’, which is no
change from previous years.
The District is finalizing a California State
Revolving Fund (SRF) loan, accompanied
by a $3 million grant, to finance the Plant
134 technology upgrade. Similar funding
has been applied for to assist the District
with the construction of the Plant 150
treatment facility.
To the extent these facilities are not
financed through SRF loans and grants, the
District can utilize proceeds from the 2010
Revenue Bonds. The District will utilize
future rate increases and, if necessary,
additional debt to complete these projects.
New Regulation
Water
The District continues to monitor proposed
regulations related to Radon, issued by the
EPA in May 2000. Many water agencies
have challenged some of the findings in the
proposal, and the District is sponsoring
proposed changes that would ease
treatment requirements.
Rate Increases
In June 2010, an independent financial
consulting firm completed updates to the
District’s water and sewer rate studies. The
study projected revenue requirements for
EAST VALLEY WATER DISTRICT
MANAGEMENT’S DISCUSSION AND ANALYSIS
-10-
fiscal years 2009-10 through 2019-20, and
incorporated the District’s Capital
Improvement Program, future operating
costs adjusted for inflation, debt service
expenses, and the funding of three reserves:
the Operating Reserve, a Rate Stabilization
Reserve, and a Replacement Reserve.
On July 15th 2010, the District Board of
Directors approved rate increases for both
water and sewer, which will be phased in
over a three-year period. Each phase will
become effective on October 1st beginning in
2010.
Contacting the District’s Financial
Management
This financial report is designed to give our
customers / ratepayers and creditors and
investors a general overview of the District’s
finances, and to demonstrate the District’s
accountability for money it receives, and
stewardship over facilities it maintains.
If you have questions about this report, or
need additional information, contact the
District’s Finance Department at 3654 E.
Highland Ave, Suite 18, Highland, California
92346, or call (909) 381-6463.
East Valley Water District
Statements of Net Assets
June 30, 2010 and 2009
For comparative
purposes only
2010 2009
ASSETS
Current assets:
Cash in bank and on hand 1,261,247$ 847,475$
Investment in Local Agency Investment Fund 1,719,655 981,471
Investment in debt securities 3,058,255 3,417,633
Accounts receivable, net 1,365,802 1,493,576
Interest receivable 14,312 39,042
Other receivable 221,588 1,076,215
Inventory 975,477 1,111,816
Prepaid expenses 130,386 120,083
Total current assets 8,746,722 9,087,311
Restricted assets:
Cash in bank and on hand 536,643 1,752,554
Investment in Local Agency Investment Fund 1,796,983 1,771,840
Total restricted assets 2,333,626 3,524,394
Non-current assets:
Capital assets:
Utility plant in service 141 906 849 138 213 633
The accompanying notes are an integral part of these financial statements.
-11-
Utility plant in service 141,906,849 138,213,633
Less: accumulated depreciation (48,381,430) (45,548,854)
Utility plant in service, net of depreciation 93,525,419 92,664,779
Capital assets, not being depreciated 19,094,492 20,909,695
Total capital assets 112,619,911 113,574,474
Assessments receivable 83,188 106,906
Deferred charges 140,557 176,618
Total non-current assets 112,843,656 113,857,998
Total assets 123,924,004$ 126,469,703$
The accompanying notes are an integral part of these financial statements.
-11-
East Valley Water District
Statements of Net Assets (Continued)
June 30, 2010 and 2009
For comparative
purposes only
2010 2009
LIABILITIES
Current liabilities:
Accounts payable - trade 1,904,463$ 1,897,482$
Accounts payable - other 281,720 839,468
Retentions payable 25,485 27,935
Accrued payroll and benefits 1,402,946 1,132,738
Accrued interest payable 236,486 250,850
Current portion of capital lease 9,545 -
Current portion of long-term debt 1,417,158 1,968,695
Total current liabilities 5,277,803 6,117,168
Liabilities payable from restricted assets:
Customer service deposits 1,659,933 1,646,990
Construction deposits 137,050 124,850
Total liabilities payable from restricted assets 1,796,983 1,771,840
Non-current liabilities:
Long-term portion of capital lease 37,730 -
Long-term portion of debt 17,973,206 19,394,355
Less: Deferred amount on refunding of certificates
The accompanying notes are an integral part of these financial statements.
-12-
Less: Deferred amount on refunding of certificates
of participation (198,138) (255,677)
Total non-current liabilities 17,812,798 19,138,678
Total liabilities 24,887,584 27,027,686
NET ASSETS
Invested in capital assets, net of related debt 93,380,410 93,342,590
Unrestricted 5,656,010 6,099,427
Total net assets 99,036,420$ 99,442,017$
The accompanying notes are an integral part of these financial statements.
-12-
East Valley Water District
Statements of Revenues, Expenses and Changes in Net Assets
For the years ended June 30, 2010 and 2009
For comparative
purposes only
2010 2009
OPERATING REVENUES
Water sales 11,638,234$ 11,635,946$
Water meter charges 3,215,189 3,096,902
Sewer charges 9,174,300 9,039,158
Other charges 399,336 763,245
Total operating revenues 24,427,059 24,535,251
OPERATING EXPENSES
Water department:
Source of supply 815,349 614,542
Pumping 2,971,681 2,961,179
Treatment 1,453,365 1,320,608
Transmission and distribution 1,586,237 1,413,698
Customer account 459,596 614,269
Total water department 7,286,228 6,924,296
Sewer department:
Wastewater collection 474,244 443,934
Customer accounts 437,395 235,470
Sewer treatment 5,665,046 5,631,258
Total sewer department 6,576,685 6,310,662
Administrative and general 6,837,914 6,492,378
Operating expenses before depreciation 20,700,827 19,727,336
Depreciation 3,314,277 3,140,265
Total operating expenses 24,015,104 22,867,601
Operating income 411,955$ 1,667,650$
The accompanying notes are an integral part of these financial statements.
-13-
East Valley Water District
Statements of Revenues, Expenses and Changes in Net Assets (Continued)
For the years ended June 30, 2010 and 2009
For comparative
purposes only
2010 2009
NONOPERATING REVENUES (EXPENSES)
Investment income 61,192$ 235,826$
Other income 178,515 138,173
Loss on disposal of capital assets (133,412) (110,944)
Interest expense (989,019) (1,094,926)
Amortization (36,061) (37,956)
Total nonoperating revenues (expenses) (918,785) (869,827)
Income before contributions and transfers (506,830) 797,823
CONTRIBUTIONS AND TRANSFERS
Utility plant dedicated - 381,182
Capacity charges 97,503 390,021
Grants 3,730 1,754,445
Capital contribution from mutual water company (North Fork) - 233,410
Transfer of capital asset (CIP) to mutual water company (North Fork) - (1,022,033)
Total contributions and transfers 101,233 1,737,025
CHANGE IN NET ASSETS (405,597) 2,534,848
NET ASSETS - BEGINNING OF YEAR 99,442,017 96,907,169
NET ASSETS - END OF YEAR 99,036,420$ 99,442,017$
The accompanying notes are an integral part of these financial statements.
-14-
East Valley Water District
Statements of Cash Flows
For the years ended June 30, 2010 and 2009
For comparative
purposes only
2010 2009
CASH FLOWS FROM OPERATING ACTIVITIES
Cash received from customers 24,579,976$ 24,622,223$
Cash payments to employees for services (6,485,299) (5,886,242)
Cash payments to suppliers for goods and services (14,484,833) (14,028,513)
Other income received 1,123,034 143,521
Net cash provided by operating activities 4,732,878 4,850,989
CASH FLOWS FROM CAPITAL AND RELATED FINANCING ACTIVITIES
Grant funds received 3,730 1,736,474
Contributed capital 97,503 390,021
Principal paid on capital debt (1,977,292) (1,872,137)
Interest paid on capital debt (949,519) (1,035,455)
Acquisition and construction of capital assets (2,406,595) (7,997,968)
Proceeds from retired assets - 4,182
Net expenditures paid to retire assets (30,975) -
Net cash used for capital and related financing activities (5,263,148) (8,774,883)
CASH FLOWS FROM INVESTING ACTIVITIES
Interest received from investments 85,922 268,248
Acquisition of investments in debt securities (9,005,935) (2,611,213)
Proceeds from sales of investments in debt securities 9,365,313 5,422,568
Loan collections from Arroyo Verde Assessment District property owners 46,158 20,679
Net cash provided by investing activities 491,458 3,100,282
NET DECREASE IN CASH (38,812) (823,612)
CASH AT BEGINNING OF YEAR 5,353,340 6,176,952
CASH AT END OF YEAR 5,314,528$ 5,353,340$
The accompanying notes are an integral part of these financial statements.
-15-
East Valley Water District
Statements of Cash Flows (Continued)
For the years ended June 30, 2010 and 2009
For comparative
purposes only
2010 2009
RECONCILIATION OF OPERATING (LOSS) INCOME TO NET CASH USED FOR
OPERATING ACTIVITIES:
Operating income 411,955$ 1,667,650$
Adjustments:
Depreciation and amortization 3,314,277 3,140,265
Miscellaneous income 178,515 138,173
Change in assets and liabilities:
(Increase) decrease in accounts receivable 127,774 38,453
(Increase) decrease in other receivables 944,519 5,348
(Increase) decrease in inventory 24,007 (91,107)
(Increase) decrease in prepaid expenses (10,303) 70,746
Increase (decrease) in trade accounts payable (553,217) (420,988)
Increase (decrease) in accrued salaries and vacation pay 270,208 253,930
Increase (decrease) in customer and other deposits 12,943 35,169
Increase (decrease) in developers' deposits 12,200 13,350
Net cash provided by operating activities 4,732,878$ 4,850,989$
CASH AT END OF YEAR
Ending cash and cash equivalents are presented in the accompanying
statements of net assets as follows:
Current assets:
Cash in bank and on hand 1,261,247$ 847,475$
Cash in Local Agency Investment Fund 1,719,655 981,471
2,980,902 1,828,946
Restricted cash in Local Agency Investment Fund
Cash in bank and on hand 536,643 1,752,554
Cash in Local Agency Investment Fund 1,796,983 1,771,840
5,314,528$ 5,353,340$
NON-CASH INVESTING, CAPITAL AND NONCAPITAL FINANCING ACTIVITIES:
Utility plant contributed by developers -$ 381,182$
Fair value adjustment to debt securities - (17,109)
Transfer of capital asset (CIP) to North Fork (grant project) - 1,022,033
Capital contribution from North Fork (grant project) - 233,410
North Fork stock basis increase from EVWD share of capital
contributions (grant project) - 188,992
Capital assets obtained through financing activities 55,556 -
Transfer of inventory to vendor for replacement 112,332 -
The accompanying notes are an integral part of these financial statements.
-16-
See Independent Auditors' Report
-17-
East Valley Water District
Notes to the Financial Statements
For the year ended June 30, 2010
Note 1: Nature of Organization and Summary of Accounting Policies
East Valley Water District (the District) is a special district formed in 1954 as a result of an election by local
residents who desired water service by a public water agency. Later, as the population increased, a modern
sewer system was needed to replace the septic tanks used at the time. Citizens voted to give the District
responsibility for that service. The District encompasses an area of approximately 25 square miles and provides
water and sewer service to the City of Highland, parts of the City of San Bernardino and unincorporated parts of
the County of San Bernardino, California.
(a) Reporting entity
The criteria used in determining the scope of the reporting entity are based on the provisions of
Governmental Accounting Standards Board (GASB) Statement 14. The District is the primary
government unit. The District is organized and existing under Division 12 of the water code of the State of
California. The purposes of the District are to finance, construct, operate and maintain a water
distribution and sewer collection system to serve properties within the District's boundaries.
The East Valley Public Facilities Corporation (the Corporation) is a component unit. A component unit is
an entity which is financially accountable to the primary government unit, either because the primary
government unit appoints a voting majority of the component unit's board or because the component unit
will provide a financial benefit or impose a financial burden on the primary government unit. The
Corporation was incorporated October 1986, pursuant to the nonprofit public benefit corporation law of
the State of California to provide financial assistance to the District by acquiring and constructing various
public improvements, and by acquiring land and related facilities for the use, benefit and enjoyment of the
public.
The Corporation has been accounted for as a "blended" component unit of the District. Despite being
legally separate, this entity is so intertwined with the District that it is, in substance, part of the District's
operations. Accordingly, the balances and transactions of this component unit are reported within the
financial records of the District. However, interagency transactions between the District and the
Corporation have been eliminated for financial reporting purposes.
The following specific criteria were used in determining that the Corporation was a blended component
unit:
The members of the Board of Directors and District management also act as the governing body
of the Corporation.
The Corporation is managed by employees of the District.
(b) Basis of accounting and measurement focus
The District uses the economic resources measurement focus and the accrual basis of accounting.
Accordingly, revenues are recognized when they are earned and expenses are recorded when the
liability is incurred, with the following exception: a portion of June water usage is not accrued, and is
therefore not recognized as revenue until the following year; this is due to the large number of district
services which require an almost continuous billing cycle. This exception is consistent with prior years.
The District follows all applicable GASB pronouncements, and all Financial Accounting Standards Board
(FASB) Statements and Interpretations, Accounting Principles Board (APB) Opinions and Accounting
Research Bulletins (ARB) issued on or before November 30, 1989 unless they conflict with or contradict
GASB pronouncements. The District applies only GASB pronouncements issued after November 30,
1989.
See Independent Auditors' Report
-18-
East Valley Water District
Notes to the Financial Statements
For the year ended June 30, 2010
Note 1: Nature of Organization and Summary of Accounting Policies (continued)
(b) Basis of accounting and measurement focus (continued)
On July 1, 2000, the District adopted the provisions of GASB Statement No. 34, Basic Financial
Statements – and Management’s Discussion and Analysis – for State and Local Governments.
Statement 34 established standards for external financial reporting for all state and local governmental
entities, which includes a statement of net assets, a statement of revenues, expenses and changes in net
assets, and a statement of cash flows. It requires the classification of net assets into three components –
invested in capital assets, net of related debt; restricted; and unrestricted. These classifications are
defined as follows:
Invested in capital assets, net of related debt – This component of net assets consists of capital assets,
including restricted capital assets, net of accumulated depreciation reduced by the outstanding balances
of any bonds, mortgages, notes, or other borrowings that are attributable to the acquisition, construction,
or improvement of those assets. If there are significant unspent related debt proceeds at year-end, the
portion of the debt attributable to the unspent proceeds are not included in the calculation of invested in
capital assets, net of related debt. Rather, that portion of the debt is included in the same net assets
component as the unspent proceeds.
Restricted – This component of net assets consists of constraints placed on net asset use through
external constraints imposed by creditors (such as through debt covenants), grantors, contributors, or
laws or regulations of other governments or constraints imposed by law through constitutional provisions
or enabling legislation.
Unrestricted net assets – This component of net assets consists of net assets that do not meet the
definition of “restricted” or “invested in capital assets, net of related debt.”
On July 1, 2000, the District also adopted the provisions of GASB Statement No. 33, Accounting and
Financial Reporting for Nonexchange Transactions. This statement prescribes methods for recognizing
revenue and related assets on transactions in which the District receives value without having to give
equal value in exchange. Examples are grants, developer fees, and property taxes.
(c) Implementation of new pronouncements
Effective July 1, 2009, the District adopted a new accounting statement issued by the GASB:
Statement No. 51, Accounting and Financial Reporting for Intangible Assets
The objective of this statement is to establish accounting and financial reporting requirements for
intangible assets to reduce inconsistencies, particularly in the areas of recognition, initial measurement
and amortization, which have occurred in practice due to the absence of sufficiently specified authoritative
guidance. By reducing inconsistencies, this statement enhances the comparability of the accounting and
financial reporting of such assets among state and local governments. It also results in a more faithful
representation of the service capacity of intangible assets, and therefore the financial position of
governments, and of the periodic cost associated with the usage of such service capacity in governmental
financial statements.
(d) Comparative data
Prior year data has been included where practical for comparison purposes only. The prior year data
does not represent a complete presentation in accordance with generally accepted accounting principles.
See Independent Auditors' Report
-19-
East Valley Water District
Notes to the Financial Statements
For the year ended June 30, 2010
Note 1: Nature of Organization and Summary of Accounting Policies (continued)
(e) Inventory valuation
Inventories are valued at cost using the average-cost method.
(f) Capitalization and depreciation
Assets purchased or constructed by the District are recorded at cost. Assets contributed to the District
are recorded at estimated cost. The estimated cost, determined by the District's engineer, is the amount
the District would have to pay for construction of comparable facilities.
Depreciation is computed using the straight-line method over the estimated useful lives of the various
assets. Water canals, water and sewer lines are depreciated over 25 to 50 years; office equipment and
vehicles are depreciated over 5 years.
Water stock and rights contributed to the District are recorded at the same value the District is currently
paying for the purchase of similar stock.
(g) Restricted assets
Certain assets of the District are restricted in use by ordinance or debt covenant and accordingly are
shown as restricted assets on the accompanying Statements of Net Assets. Unexpended COP
proceeds are set aside for capital improvements, District deposits into COP trustee accounts are to be
used for debt service, and utility deposits must be returned to the customers at their request after their
account has been paid timely for 12 consecutive months, or when their account is closed.
(h) Cash and equivalents
For purposes of the statement of cash flows, cash represents demand deposits held in financial
institutions or in cash management pools where funds can be added or withdrawn at any time without
prior notice or penalty and cash equivalents are highly liquid investments with a maturity of three months
or less from the date of purchase.
(i) Investments
The District has adopted the provisions for GASB Statement No. 31, Accounting and Financial Reporting
for Certain Investments and External Pools (GASB 31), which require governmental entities to report
certain investments at fair value in the statement of net assets and recognize the corresponding change
in the fair value of investments in the year in which the change occurred. In accordance with GASB 31,
the District has adjusted certain investments to fair value.
Investments are included within the financial statement classifications of Investment in Local Agency
Investment Fund and Investment in debt securities.
(j) Accrued vacation and sick leave
The District has a policy whereby an employee can accumulate unused sick leave and vacation. Sick
leave is to be used for extended periods of sickness; however, upon termination or retirement, a portion
will be paid as additional benefits to the employee. At retirement or termination, employees who have
accumulated over ten years of service will be paid between 40% to 70% of their unused sick leave (based
upon their balance of unused sick leave) at their regular payroll rates in effect at the date of termination.
Also, employees that obtain 196 unused sick hours can cash out 40 hours at their discretion. The District
has provided for these future costs by accruing a range of the earned and unused sick leave and 100% of
the earned and unused vacation.
See Independent Auditors' Report
-20-
East Valley Water District
Notes to the Financial Statements
For the year ended June 30, 2010
Note 1: Nature of Organization and Summary of Accounting Policies (continued)
(k) Classification of revenue
As an enterprise (proprietary) fund, the District classifies its revenues into three classifications: operating
revenue, non-operating revenue, and contributions.
Operating revenues are defined as revenues realized by the District in exchange for providing its primary
services of water distribution and wastewater collection to its customers. Non-operating revenues are
those derived from the investment of cash reserves and from the disposal of excess property, and also
include those resources received from entities other than customers, such as governmental agencies and
developers, for purposes not related to capital improvement. Donated plant and cash received for capital
improvement without the requirement that the District give resources in exchange are recorded as
contributions.
(l) Use of restricted resources
The District uses restricted resources, prior to using unrestricted resources, to pay expenditures meeting
the criteria imposed on the use of restricted resources by a third party.
(m) Postemployment healthcare benefits
On July 1, 2008, the Agency adopted the provisions of Governmental Accounting Standards Board
Statement No. 45, Accounting and Financial Reporting by Employers for Postemployment Benefits Other
Than Pensions (GASB 45). This statement requires the annual cost of other postemployment benefits
other than pensions (OPEB) and the unfunded actuarial liabilities for past service to be reported in the
government financial statements. Previously, the costs of such benefits were generally recognized as
expenses when incurred by retirees. Under GASB 45, the cost of these benefits will be estimated over
the years employees are providing service. GASB 45 also requires comprehensive disclosure regarding
OPEB activities, see Note 10, Postemployment Benefits Other Than Pension.
(n) Management review
Management has evaluated subsequent events through December 22, 2010, the date which the financial
statements were available to be issued.
(o) Use of estimates
The preparation of financial statements in conformity with accounting principles generally accepted in the
United States of America requires management to make estimates and assumptions that affect certain
reported amounts and disclosures. Accordingly, actual results could differ from those estimates.
See Independent Auditors' Report
-21-
East Valley Water District
Notes to the Financial Statements
For the year ended June 30, 2010
Note 2: Cash and Investments
Cash and investments as of June 30, 2010 and 2009 are classified in the accompanying financial statements as
follows:
Statement of net assets: 2010 2009
Current assets:
Cash in bank and on hand $ 1,261,247 $ 847,475
Investment in Local Agency Investment Fund 1,719,655 981,471
Investment in debt securities 3,058,255 3,417,633
Total 6,039,157 5,246,579
Restricted assets:
Cash in bank and on hand 536,643 1,752,554
Investment in Local Agency Investment Fund 1,796,983 1,771,840
Total 2,333,626 3,524,394
Grand total $ 8,372,783 $ 8,770,973
Cash and investments as of June 30, 2010 and 2009 consist of the following:
2010 2009
Cash on hand $ 1,750 $ 1,750
Deposits with financial institutions 305,452 290,954
Money market accounts with financial institutions 1,490,688 2,307,325
Investment in Local Agency Investment Fund 3,516,638 2,753,311
Investment in debt securities 3,058,255 3,417,633
Total $ 8,372,783 $ 8,770,973
Investments Authorized by the California Government Code and the District’s Policy
The table below identifies the investment types that are authorized by the District’s investment policy and in
accordance with Section 52601 of the California Government Code. The table also identifies certain provisions of
the Agency’s investment policy that address interest rate risk and concentration of credit risk.
Maximum Authorized Required
Authorized investment type maturity limit (%) rating
Bonds & certificates of participation by EVWD 5 years None None
U.S. Treasury bills, notes or bonds 5 years None None
State registered warrants, notes or bonds 5 years None None
Notes & bonds of other local California agencies 5 years None None
U.S. agencies 5 years None None
Negotiable certificates of deposits 5 years 30% None
Money market mutual funds & mutual funds 5 years 15% 2-AAA
Collaterialized bank deposits 5 years None None
Local Agency Investment Fund N/A None None
The California Local Agency Investment Fund (LAIF) is a special fund of the California State Treasury through
which local governments may pool investments. Investments in LAIF are highly liquid as deposits can be
converted to cash within 24 hours without loss of interest.
At June 30, 2010, the District had no investments in repurchase agreements and did not utilize this investment
media during the reporting year. As a matter of investment policy, the District does not borrow funds through the
use of reverse repurchase agreements.
See Independent Auditors' Report
-22-
East Valley Water District
Notes to the Financial Statements
For the year ended June 30, 2010
Note 2: Cash and Investments (continued)
Disclosure Relating to Interest Rate Risk
Interest rate risk is the risk that a change in the market rate will adversely affect the fair value of an investment.
Generally, the longer the maturity of the investment, the greater the sensitivity to change in fair value due to
fluctuation in market interest rates. One of the ways the District minimizes their exposure to this type of risk is by
investing in investments with laddered maturity dates.
As of June 30, 2010, the District had the following investments and maturities:
Less than
Investment type Fair value 1 year 1 - 2 Years
LAIF $ 3,516,638 $ 3,516,638 $ -
Farmer Mac 404,154 106,204 297,950
Federal Farm Credit Bank 800,360 - 800,360
Federal Home Loan Bank 604,350 26,133 578,217
Fannie Mae 300,000 - 300,000
U.S. Treasury Bonds 949,391 - 949,391
Total $ 6,574,893 $ 3,648,975 $ 2,925,918
Disclosure Relating to Credit Risk
Generally, credit risk is the risk that an issuer of an investment will not fulfill its obligation to the holder of the
investment. This is measured by the assignment of a rating by a nationally recognized statistical rating
organization. Presented below is the minimum required rating by (where applicable) the California Code, the
District’s investment policy and the actual rating as of year ended for each investment type.
Minimum
Investment type Fair value legal rating Actual rating
LAIF $ 3,516,638 N/A N/A
Farmer Mac 404,154 N/A AAA
Federal Farm Credit Bank 800,360 N/A AAA
Federal Home Loan Bank 604,350 N/A AAA
Fannie Mae 300,000 N/A AAA
U.S. Treasury Bonds 949,391 N/A AAA
Disclosure Related to Concentration of Credit Risk
The District’s policy places no limits on amounts invested in any given issuer beyond that stipulated by the
California Government Code.
At June 30, 2010, the following investments exceeded 5% of the District’s total investments:
Investment type Fair value
LAIF 53.49%
Farmer Mac 6.15%
Federal Farm Credit Bank 12.17%
Federal Home Loan Bank 9.19%
U.S. Treasury Bonds 14.44%
See Independent Auditors' Report
-23-
East Valley Water District
Notes to the Financial Statements
For the year ended June 30, 2010
Note 2: Cash and Investments (continued)
Disclosure Related to Custodial Credit Risk
Custodial Credit Risk for deposits is the risk that, in the event of the failure of a depository financial institution, a
government will not be able to recover its deposits or will not be able to recover collateral securities that are in the
possession of an outside party. The custodial risk for investments is the risk that in the event of the failure of the
counterparty to a transaction, a government will not be able to recover the value of its investment or collateral
securities that are in the possession of another party. The California Government Code requires California banks
and savings and loan associations to secure deposits by pledging government securities as collateral. Such
collateralization of public funds is accomplished by pooling. As such, collateralized securities are held by the
pledging financial institution’s agent on behalf of the District. The market value of pledged securities must equal
at least 110 percent of the District’s deposits. California law also allows financial institutions to secure deposits
by pledging first trust deed mortgage notes having a value of 150 percent of a public entity’s total deposits. The
District may waive collateral requirements for deposits which are fully insured by Federal depository insurance.
As of June 30, 2010 and 2009, the District’s deposits with financial institutions that were in excess of federal
depository insurance limits were $230,585 and $32,984, respectively. On October 3, 2008, the Emergency
Economic Stabilization Act of 2008 became effective, which temporarily covers non-interest bearing deposit
accounts without limit and increases the federal deposit insurance limit from $100,000 to $250,000 for interest
bearing deposit accounts. The limit will return to $100,000 for all deposit accounts held with a single financial
institution after December 31, 2013.
Investment in State Investment Pool
The management of the State of California Pooled Money Investment Account (generally referred to as LAIF) has
reported to its participating agencies that, as of June 30, 2010, the carrying amount (at amortized cost) of the pool
was $69,441,630,091 and the estimated fair value of the pool was $69,555,776,591. The District’s proportionate
share of the pool’s market value (as determined by LAIF) as of June 30, 2010, was $3,516,638. Included in
LAIF’s investment portfolio are collateralized mortgage obligations, mortgage-backed securities, other asset-
backed securities, loans to certain state funds, and floating rate securities issued by federal agencies,
government-sponsored enterprises, and corporations.
Note 3: Capital Assets
A summary of changes in utility plant for the year ended June 30, 2010 is as follows:
Capital assets, being depreciated/amortized:
Beginning Ending
Water balance Increases Decreases balance
Source of supply plant $ 11,691,113 $ 691,017 $ 135,450 $ 12,246,680
Pumping plant 8,456,271 - - 8,456,271
Treatment plant 9,670,415 2,356,432 - 12,026,847
Transmission and distribution 76,609,329 768,867 - 77,378,196
General plant 5,045,543 136,066 248,789 4,932,820
Total water 111,472,671 3,952,382 384,239 115,040,814
Sewer
Collection plant 23,417,572 261,396 - 23,678,968
General plant 3,323,390 50,640 186,963 3,187,067
Total sewer 26,740,962 312,036 186,963 26,866,035
Grand total $ 138,213,633 $ 4,264,418 $ 571,202 $ 141,906,849
See Independent Auditors' Report
-24-
East Valley Water District
Notes to the Financial Statements
For the year ended June 30, 2010
Note 3: Capital Assets (continued)
Capital assets, not being depreciated/amortized:
Beginning Ending
Water balance Increases Decreases balance
Land and easements $ 3,220,669 $ 5,957,755 $ 694,361 $ 8,484,063
Intangible plant 20,954 - - 20,954
Water stock and rights 1,551,731 1,750 - 1,553,481
Construction in progress 15,689,903 2,601,115 13,415,930 4,875,088
Total 20,483,257 8,560,620 14,110,291 14,933,586
Sewer
Land and easements 29,215 3,892,747 - 3,921,962
Construction in progress 397,223 91,551 249,830 238,944
Total 426,438 3,984,298 249,830 4,160,906
Grand total $ 20,909,695 $ 12,544,918 $ 14,360,121 $ 19,094,492
Note 4: Long-Term Debt
Long-term debt reflected on the accompanying Statements of Net Assets includes the following:
2010 2009
Arroyo Verde Assessment District (AVAD)
construction loan - interest at 0%, maturities through
2031 $ 138,624 $ 145,385
1996 refunding certificates of participation - interest
from 3.25% to 5.40%, maturities through 2009 - 615,000
2001 certificates of participation - interest from 4.25%
to 5.00%, maturities through 2020 5,935,000 6,685,000
2004 project installment sale note - interest at 4.50%,
maturities through 2024 8,067,777 8,455,152
2006 project installment sale note - interest at 4.95%,
maturities through 2026 5,218,703 5,428,578
19,360,104 21,329,115
Less issuance discounts - (3,050)
Add issuance premiums 30,260 36,985
19,390,364 21,363,050
Less current portion:
AVAD construction loan 6,762 3,381
1996 certificates - 615,000
2001 certificates 785,000 750,000
2004 installment note 405,003 387,375
2006 installment note 220,393 209,875
1,417,158 1,965,631
Discounts and premiums - 3,064
1,417,158 1,968,695
Totals $ 17,973,206 $ 19,394,355
See Independent Auditors' Report
-25-
East Valley Water District
Notes to the Financial Statements
For the year ended June 30, 2010
Note 4: Long-Term Debt (continued)
The schedule below summarizes changes in long-term debt principal during the year ended June 30, 2010.
Beginning Ending
balance Additions Payments balance
AVAD construction loan $ 145,385 $ - $ 6,761 $ 138,624
1996 certificates 615,000 - 615,000 -
2001 certificates 6,685,000 - 750,000 5,935,000
2004 installment note 8,455,152 - 387,375 8,067,777
2006 installment note 5,428,578 - 209,875 5,218,703
Total $ 21,329,115 $ - $ 1,969,011 $ 19,360,104
The aggregate debt service requirements to maturity for all long-term debt as of June 30, 2010 are as follows:
Year Ending June 30, Principal Interest Total
2011 $ 1,417,157 $ 868,129 $ 2,285,286
2012 1,451,632 805,186 2,256,818
2013 1,512,500 739,493 2,251,993
2014 1,579,824 669,889 2,249,713
2015 1,658,676 595,988 2,254,664
2016 and thereafter 11,740,315 2,937,231 14,677,546
Total $ 19,360,104 $ 6,615,916 $ 25,976,020
Security for debt is as follows:
Debt
Certificates of participation (series 1996 & 2001
certificates) and 2004 & 2006 project installment
sale
Security
The District is required to maintain and encumber net
revenues, as defined by the certificates of participation's
trust agreement and 2004 & 2006 project installment sale
agreements of at least 110% of District's annual debt service
(principal and interest). At June 30, 2010, net water
revenues represented 121% of the annual debt service.
Capital Lease
The District has entered into a capital lease commitment for a telecommunications system. The amount financed
was $55,556 to be repaid over a sixty-month period with interest at 11.09%. The agreement requires monthly
installment payments of principal and interest of $1,124 beginning on August 19, 2009 and ending on July 19,
2015. As of June 30, 2010, accumulated depreciation on the telecommunication system was $2,778, resulting in
a net book value of $52,778. The future minimum lease obligations and the net present value of these minimum
lease obligations are as follows:
Year ending June 30, Payments
2011 $ 14,679
2012 14,679
2013 14,679
2014 14,679
2015 1,322
Total minimum lease obligations 60,038
Less: amounts representing interest (12,763)
Present value of minimum lease obligations $ 47,275
See Independent Auditors' Report
-26-
East Valley Water District
Notes to the Financial Statements
For the year ended June 30, 2010
Note 5: Defeased Debt
1996 Refunding
On May 14, 1996, the District issued 1996 Refunding Certificates of Participation of $8,140,000 with interest rates
ranging from 3.25% to 5.40% to advance refund outstanding certificates of participation issued in 1986 (Highland
system), 1989 (water facility) and 1989 (Highland system) totaling $8,570,000. The advance refunding resulted in
a difference between the reacquisition price and the net carrying amount of the old debt of $439,410. This
difference is being charged as a component of interest expense through the year 2009 using the straight-line
method of amortization. The District in effect reduced its aggregate debt service cash flow by $755,433 over the
term of the new certificates and obtained an economic gain (difference between the present values of the old and
new debt service payments) of $203,488.
2001 Refunding
On April 26, 2001, the District issued $12,000,000 of Series 2001 Certificates of Participation (COPS). The new
COPS were issued to finance the construction of a new 4 million gallon reservoir ($5,580,000), and for advance
refunding $6,165,000 of then outstanding 1994 COPS ($6,420,000). The refunding portion of the 2001 COPS
carry interest rates from 4.250% to 4.625% and will be repaid in various principal increments with the final
payment due on December 1, 2014. The refunded 1994 COPS carried interest rates from 5.500% to 6.600% and
also were due in various principal increments with the final payment due on December 1, 2014.
The refunding portion of the 2001 COPS were issued at a premium of $49,167, and after paying issuance costs
and insurance of $176,575, the net proceeds were $6,292,592. The advance refunding met the requirements of
an in-substance defeasance; accordingly, the 1994 COPS are no longer reflected as a liability on the
accompanying financial statements.
The advance refunding resulted in a difference between the reacquisition price and the carrying amount of the old
debt of $601,753. This difference, reported in the accompanying financial statements as a deduction from long-
term debt payable, is being charged to operations through the year 2015 using the straight-line method of
amortization. The District completed the refunding to decrease total debt service over the next 13 years by
$574,329 and to obtain an economic gain (difference between the present values of the old and new debt service
payments) of $272,083.
Note 6: Defined Benefit Pension Plan (PERS)
Plan Description
East Valley Water District contributes to the California Public Employees’ Retirement System (PERS), a cost
sharing multiple-employer public employee defined benefit pension plan. PERS provides retirement, disability
benefits, and death benefits to plan members and beneficiaries. PERS acts as a common investment and
administrative agent for participating public entities within the State of California. Copies of PERS’ annual
financial report may be obtained from its executive office at 400 P Street, Sacramento, California 95814.
All full-time District employees are eligible to participate in PERS with benefits vesting after five years of service.
District employees who retire at age 55 are entitled to an annual retirement benefit, payable monthly for life, in
increasing percentage increments up to 2.7% of their average full-time monthly pay rate for the highest 12
consecutive months for each year of credited services.
See Independent Auditors' Report
-27-
East Valley Water District
Notes to the Financial Statements
For the year ended June 30, 2010
Note 6: Defined Benefit Pension Plan (PERS) (continued)
Funding Policy
District employees are required to contribute 8% of their annual covered salary. The District makes the
contributions required of District employees on their behalf and for their account. The District is required to
contribute an amount necessary to fund the benefits of its members, using the actuarial basis recommended by
the PERS actuaries and actuarial consultants and adopted by the Board of Administration. For the years ended
June 30, 2010 and 2009, the amounts contributed by the District on behalf of the employees was $377,418 and
$314,812, respectively.
Annual Pension Cost
Under GASB 27, an employer reports an annual pension cost (APC) equal to the annual required contribution
(ARC) plus an adjustment for cumulative difference between the APC and the employer’s actual plan
contributions for the year. The cumulative difference is called the net pension obligation (NPO). The ARC for the
period July 1, 2009 to June 30, 2010 has been determined by an actuarial valuation of the plan as of June 30,
2007. The contribution rate for the indicated period is 16.424% of covered payroll. In order to calculate the dollar
value of the ARC for inclusion in financial statements prepared as of June 30, 2010, this contribution rate would
be multiplied by the payroll of covered employees that was actually paid during the period July 1, 2009 to June
30, 2010. A summary of the APC for the current year and each of the preceding two years is as follows:
Annual Percentage
Pension of APC
Fiscal year Cost (APC) contributed
June 30, 2008 $ 736,225 100%
June 30, 2009 940,107 100%
June 30, 2010 1,129,524 100%
Risk Pool
Assembly Bill 1974, which added Sections 20840-20842 to the California Government Code allowed PERS to
create risk pools and mandate public agency participation in those pools. Commencing with the valuation of
June 30, 2003, mandatory pooling was established for plans with less than 100 active members. As a result, the
District was required to participate in a risk pool of other Agencies/Districts with less than 100 employees.
At the time of joining a risk pool (valuation of June 30, 2003), a side fund was created to account for the
difference between the funded status of the pool and the funded status of the District's plan. The side fund for the
District’s plan as of the June 30, 2007 valuation was a negative $1,283,061.
The side fund will be credited, on an annual basis, with the actuarial investment return assumption. This
assumption is currently 7.75%. The negative side fund will cause the District’s required employer contribution
rate to be increased by the amortization of the side fund. In the absence of subsequent contract amendments or
funding changes, the side fund will disappear at the end of the amortization period. The amortization period
remaining as of June 30, 2007 was 7 years.
See Independent Auditors' Report
-29-
East Valley Water District
Notes to the Financial Statements
For the year ended June 30, 2010
Note 8: Risk Management
The District participates in a joint powers agreement (JPA) with the Special District Risk Management Authority
(Authority). The Authority is a risk-pooling self-insurance authority created under the provisions of California
Government Code Section 6500 et. sec. The Authority is governed by a board consisting of a representative from
each member agency. The board controls the operations of the Authority including selection of management and
approval of operating budgets. The relationship between the District and the Authority is such that the Authority is
not a component unit of the District for financial reporting purposes.
The purpose of the Authority is to arrange and administer programs of insurance for the pooling of self-insured
losses and to purchase excess insurance coverage.
At June 30, 2010, the District participation in the self-insurance programs of the Authority was as follows:
Limits Deductible
Personal injury and property $10,000,000 per occurrence / aggregate where $500 (property
damage liability coverage - applicable damage only)
general
Personal injury and property $10,000,000 per accident $1,000
damage liability coverage -
auto
Public officials and employees $10,000,000 per wrongful act / annual member none
errors and omissions liability aggregate
Employee practices liability $10,000,000 per wrongful employment practice / none up to
aggregate limits per member included $10,000, 50%
with public officials and employee errors co-insurance
and omissions coverage up to $50,000,
none over
$50,000
Employee benefits liability $10,000,000 per wrongful act / annual member none
aggregate
Employee dishonesty coverage $400,000 per loss $25,000
Public officials personal liability $500,000 per occurrence / annual aggregate $500
per board member
Automobile physical damage Replacement cost (stated value adjusted $250/$500 or
for depreciation, on selected vehicles) $500/$1,000
comprehensive /
collision (as
elected per
vehicle)
Uninsured motorist bodily injury $750,000 per accident none
coverage
Property coverage $1,000,000,000 replacement cost of scheduled property $2,000 in general,
if replaced (if not replaced within two varies for other
years, actual cash value basis) certain events
Boiler and machinery $100,000,000 replacement cost $1,000
See Independent Auditors' Report
-30-
East Valley Water District
Notes to the Financial Statements
For the year ended June 30, 2010
Note 9: Related Organizations
The District has purchased a majority of the voting stock of two mutual water companies in Highland, California:
the North Fork Water Company (North Fork) and City Creek Water Company (City Creek). The District’s
investment in these entities is reflected as Utility Plant on the accompanying financial statements because stock
ownership entitles the District to take certain quantities of water and to use existing water distributions systems
owned by these companies.
Ownership in the North Fork Water Company also obligates the District to pay annual assessments that are
based on the number of shares owned. Assessments paid to North Fork during the years ended June 30, 2010
and 2009 were $102,191 and $58,295, respectively.
The District had a construction project in progress (“North Fork FEMA”) which is a water canal replacement
project. Fifty percent of the project belongs to East Valley Water District and 50% belongs to North Fork. For the
year ended June 30, 2009, $1,022,033 of construction in progress was transferred to North Fork. Seventy-five
percent of the eligible costs are expected to be paid by a Federal Emergency Management Agency (FEMA) grant.
The remaining 25% is to be paid by East Valley Water District and North Fork. There has been a receivable
accrued to account for North Fork’s share of cost with a corresponding capital contribution. Likewise, there has
been a payable accrued with a corresponding increase in North Fork stock for East Valley Water District’s share
of North Fork’s cost since the District owns 80.97% of the stock.
Receivable and payable balances to related entities as of June 30, 2010 and 2009 are as follows:
2010 2009
Receivable from:
North Fork $ 793 $ 601,940
City Creek $ 32,221 $ 31,832
Payable to:
North Fork $ - $ 486,876
Note 10: Postemployment Benefits Other Than Pension
On July 1, 2008, the District implemented GASB 45 which changed the accounting and financial reporting used
by local government employers for postemployment benefits other than pensions. The reporting requirements for
these benefit programs as they pertain to the District are as set forth in the following.
Plan Description
The District contributes to the retiree health coverage of eligible retirees and eligible surviving spouses. At
retirement, the District provides the minimum employer contribution under the CalPERS Health Program for
eligible retirees and surviving spouses in receipt of a pension benefit from CalPERS. An employee is eligible for
this employer contribution provided they are vested in their CalPERS pension benefit and commence payment of
their pension benefit within 120 days of retirement with the District. Vesting requires at least five years of service.
The surviving spouse of an eligible retiree who elected spouse coverage under CalPERS is eligible for the
employer contribution upon death of the retiree.
Employees retiring with at least 20 years of District service will receive an additional District contribution through
attainment of Medicare eligibility age. The additional contribution is based on the negotiated dollar amount at
retirement (currently $550 per month). The surviving spouse of an eligible retiree is eligible for the District’s
contribution upon the death of the retiree through the spouse’s attainment of Medicare eligibility age.
See Independent Auditors' Report
-32-
East Valley Water District
Notes to the Financial Statements
For the year ended June 30, 2010
Note 10: Postemployment Benefits Other Than Pension (continued)
Funded Status
The funded status of the plan as of June 30, 2010, based on the July 1, 2008 actuarial valuation is as follows:
Actuarial accrued liability (AAL) $ 1,290,086
Actuarial value of trust assets -
Unfunded actuarial accrued liability (UAAL) $ 1,290,086
Funded ratio (actuarial value of trust
assets / AAL) 0%
Estimated covered payroll (active members) $ 4,330,000
UAAL as a percentage of covered payroll 30%
Actuarial Methods and Assumptions
Projections of benefits for financial reporting purposes are based on the substantive plan (the plan as understood
by the employer and the plan members) and include the types of benefits provided at the time of each valuation
and the historical pattern of sharing of benefit costs to that point. The actuarial methods and assumptions used
include techniques that are designed to reduce the effects of short-term volatility in actuarial accrued liabilities
and the actuarial assets, consistent with the long-term perspective of the calculations.
Significant methods and assumptions were as follows:
Valuation date July 1, 2008
Actuarial cost method Entry age normal
Amortization method Level percent of payroll
Remaining amortization period 30-year closed period
Asset valuation method N/A - no assets
Actuarial assumption:
Investment rate of return 5.00%
Payroll growth 3.25%
Healthcare trend rate:
2010 8.50%
2011-2015 7.00%
2016-2018 5.16%
2019 and thereafter 5.00%
Note 11: Prior Period Adjustment
On August 18, 1998, the District entered into a property access and release agreement with the Metropolitan
Water District of Southern California (Metropolitan) granting rights to Metropolitan to access the District's property
for the purpose of operating a water pipeline. The agreement includes rights for Metropolitan to purchase water
from the District. In 2007, a new meter was installed by Metropolitan on a water pipe accessing the District's
water and was used to bill Metropolitan for water usage. However, the quantity used to bill Metropolitan (cubic
feet) were different than the meter's unit of measurement (gallons). As a result, a series of overpayments
occurred during the current fiscal year, and during the fiscal years ended June 30, 2009, 2008, and 2007.
See Independent Auditors' Report
-33-
East Valley Water District
Notes to the Financial Statements
For the year ended June 30, 2010
Note 11: Prior Period Adjustment (continued)
The District has calculated the difference between actual billings and actual usage. The difference resulted in an
overpayment by Metropolitan of $409,109. The overpayment consisted of $288,937 for charges occurring during
the prior fiscal years and $120,172 for charges related to the current fiscal year. On January 1, 2010, an
amendment to the property access and release agreement was executed to extend the access rights to
Metropolitan until December 31, 2012, and to outline the conditions of repayment. At the end of each of the three
calendar years covering the extension, Metropolitan will be refunded $136,370 by the District, less any water
usage accumulated during the calandar year without limit.
As of June 30, 2010, the refund balance due to Metropolitan amounted to $282,561. This amount has been
included as a component of accounts payable - other on the accompanying Statements of Net Assets for years
ending June 30, 2010 and 2009. Also, the current year financial statements reflect a $282,561 reduction to
Revenues, Changes in Net Assets, and Net Assets that were reported in the June 30, 2009 financial statements.
Note 12: Subsequent Event
On October 29, 2010, the District finalized the terms of refunding revenue bonds, series 2010 (2010 Bonds)
issued by the East Valley Water District Financing Authority. The purpose of these bonds are to refund virtually
all existing debt and to provide $16,000,000 to the District for future capital improvements. The bonds were
issued at a par value of $33,545,000 with a $2,213,063 premium. The total transaction also required the District
to provide a $920,318 debt service contribution. A summary of the sources and uses of the 2010 Bonds are as
follows:
Sources of funds:
Par value of bonds $ 33,545,000
Original issue premium 2,213,063
Debt service fund contribution 920,318
Total sources of funds $ 36,678,381
Uses of funds:
2001 certificate of participation $ 6,069,582
2004 project installment sale note 8,081,918
2006 project installment sale note 5,250,694
Future capital improvements 16,000,000
Capitalized interest 655,721
Issuance costs and discounts 593,759
Other fees and charges 26,707
Total uses of funds $ 36,678,381
The 2010 Bonds are payable over 30 years with principal installments payable annually and interest payable
semi-anually. The 2010 Bonds carry an interest rate between 2.00% and 5.00% over the life of the bond.
The aggregate debt service requirements to maturity for the 2010 Bonds are as follows:
Year ending June 30, Principal Interest Total
2011 $ - $ 616,234 $ 616,234
2012 1,055,000 1,439,413 2,494,413
2013 1,175,000 1,417,112 2,592,112
2014 1,205,000 1,381,263 2,586,263
2015 1,265,000 1,331,862 2,596,862
2016 to 2020 7,210,000 5,712,363 12,922,363
2021 to 2030 9,830,000 7,353,862 17,183,862
2031 to 2041 11,805,000 3,460,219 15,265,219
Total $ 33,545,000 $ 22,712,328 $ 56,257,328
See Independent Auditors' Report
-34-
East Valley Water District
Notes to the Financial Statements
For the year ended June 30, 2010
Note 13: Financial Statement Presentation
Certain amounts in the financial statements for the year ended June 30, 2009 have been reclassified to conform
to the presentation of the financial statements for the year ended June 30, 2010. These reclassifications, as well
as the prior period adjustment disclosed in Note 11 of these financial statements, resulted in the following change
in balances as of and for the year ended June 30, 2009:
Prior year
Change from Change from restated and
Prior year prior period reclassification reclassified
balance adjustment of balances balance
Revenues $ 24,778,844 $ (282,561) $ 38,968 $ 24,535,251
Operating expenses (22,867,671) - 70 (22,867,601)
Non-operating revenues
and expenses (877,979) - 8,152 (869,827)
Contributions and transfers 1,784,215 - (47,190) 1,737,025
Change in net assets 2,817,409 (282,561) - 2,534,848
Net Assets 99,724,578 (282,561) - 99,442,017
East Valley Water District Schedule One
Page 1 of 5
Water Department
Statements of Net Assets
As of June 30, 2010 and 2009
For comparative
purposes only
2010 2009
ASSETS
Current assets:
Cash in bank and on hand 1,261,247$ 847,475$
Investment in Local Agency Investment Fund 1,719,655 -
Investment in debt securities 188,225 -
Accounts receivable, net 1,365,802 1,493,576
Interest recievable 14,312 39,042
Other receivable 221,588 1,076,215
Inventory 975,477 1,111,815
Prepaid expenses 130,386 120,083
Total current assets 5,876,692 4,688,206
Restricted assets:
Cash in bank and on hand 536,643 1,752,554
Investment in Local Agency Investment Fund 1,796,983 1,771,840
Total restricted assets 2,333,626 3,524,394
Non-current assets:
Capital assets:
Utility plant in service 115,040,814 111,472,671
Less: accumulated depreciation (35,116,514) (32,716,247)
Utility plant in service, net of depreciation 79,924,300 78,756,424
Capital assets, not being depreciated 14,933,586 20,483,257
Total capital assets 94,857,886 99,239,681
Assessments receivable 83,188 106,906
Deferred charges 140,557 176,618
Total non-current assets 95,081,631 99,523,205
Total assets 103,291,949$ 107,735,805$
See Auditors' Report on Supplementary Information
-36-
East Valley Water District Schedule One
Page 2 of 5
Water Department
Statements of Net Assets
As of June 30, 2010 and 2009
For comparative
purposes only
2010 2009
LIABILITIES
Current liabilities:
Accounts payable - trade 1,904,463$ 1,897,482$
Accounts payable - other 281,720 839,468
Retentions payable 25,485 27,935
Accrued payroll and benefits 1,402,946 1,132,738
Accumulated interest payable 236,486 250,850
Current portion of capital lease 9,545 -
Current portion of long-term debt 1,417,158 1,968,695
Total current liabilities 5,277,803 6,117,168
Liabilities payable from restricted assets:
Customer service deposits 1,659,933 1,646,990
Construction deposits 137,050 124,850
Total liabilities payable from restricted assets 1,796,983 1,771,840
Non-current liabilities:
Due to sewer department 7,000,000 9,022,344
Long-term portion of capital lease 37,730 -
Long-term portion of debt 17,973,206 19,394,355
Less: deferred amount on refunding of Certificates
of Participation (198,138) (255,677)
Total non-current liabilities 24,812,798 28,161,022
Total liabilities 31,887,584 36,050,030
NET ASSETS
Invested in capital assets, net of related debt 75,618,385 78,132,308
Unrestricted (4,214,020) (6,446,533)
Total net assets 71,404,365$ 71,685,775$
See Auditors' Report on Supplementary Information
-37-
East Valley Water District Schedule One
Page 3 of 5
Water Department
Statements of Revenues, Expenses and Changes in Net Assets
For the years ended June 30, 2010 and 2009
For comparative
purposes only
2010 2009
OPERATING REVENUES
Water sales 11,638,234$ 11,635,946$
Water meter charges 3,215,189 3,096,902
Other water charges 386,360 600,400
15,239,783 15,333,248
OPERATING EXPENSES
Source of Supply:
Supervision and labor 151,152 134,746
Purchased water 125,000 -
Laboratory analysis 276,029 255,123
Groundwater replenishment 149,826 144,215
North Fork - assessments 102,191 58,295
Supplies 2,438 2,411
Maintenance 8,713 19,752
815,349 614,542
Pumping:
Supervision and labor 512,111 488,845
Maintenance 339,053 352,072
Fuel and power 2,070,931 2,062,995
Supplies 49,586 57,267
2,971,681 2,961,179
Water Treatment:
Supervision and labor 145,190 139,202
Contracted treatment 990,007 942,446
Supplies and utilities 251,187 195,524
Maintenance 66,981 43,436
1,453,365 1,320,608
Transmission and Distribution:
Supervision and labor 1,027,018 809,178
Maintenance 279,617 199,075
Supplies 279,602 405,445
1,586,237 1,413,698
Customer Accounts:
Supervision and labor 324,636 439,334
Uncollectible accounts 5,410 3,231
Billing and maintenance 129,550 171,704
459,596$ 614,269$
See Auditors' Report on Supplementary Information
-38-
East Valley Water District Schedule One
Page 4 of 5
Water Department
Statements of Revenues, Expenses and Changes in Net Assets (Continued)
For the years ended June 30, 2010 and 2009
For comparative
purposes only
2010 2009
Administrative and General:
Salaries and wages 1,420,714$ 1,310,725$
Employee benefits 1,400,976 1,258,318
Workers' compensation 149,668 201,827
Directors' fees 89,072 68,166
Utilities and telephone 84,921 85,358
Dues and subscriptions 68,200 98,491
Office supplies and expense 75,766 60,433
Postage 12,786 21,125
Office equipment 85,108 87,740
General plant maintenance 163,161 375,255
Vehicle and maintenance expense 216,549 225,833
Facilities lease 114,630 111,539
Contractual services 437,616 632,020
General insurance 126,094 181,757
Education, seminars and conferences 25,729 21,076
Meals, lodging and travel 14,794 25,873
Employee programs 13,165 -
License and certifications 1,566 -
Regulatory fees and compliance 97,736 -
Public education/outreach 19,251 -
Election expense 256 -
Safety equip/emergency planning 35,620 27,248
4,653,378 4,792,784
OPERATING EXPENSES BEFORE DEPRECIATION 11,939,606 11,717,080
Depreciation 2,695,004 2,506,211
Total operating expenses 14,634,610 14,223,291
Operating income 605,173 1,109,957
NON-OPERATING REVENUE:
Investment income 27,163 157,611
Legal settlement 33,962 -
Miscellaneous 144,553 138,173
Total non-operating revenue 205,678 295,784
NON-OPERATING EXPENSES:
Interest expense 989,019 1,094,926
Amortization - issuance costs 36,061 35,280
Amortization expense - lease costs - 2,676
Loss on disposal of assets 135,493 75,027
Total nonoperating revenues (expenses) 1,160,573 1,207,909
Income before contributions and transfers (349,722)$ 197,832$
See Auditors' Report on Supplementary Information
-39-
East Valley Water District Schedule One
Page 5 of 5
Water Department
Statements of Revenues, Expenses and Changes in Net Assets (Continued)
For the years ended June 30, 2010 and 2009
For comparative
purposes only
2010 2009
CONTRIBUTIONS AND TRANSFERS:
Utility plant dedicated -$ 381,182$
Capacity charges 64,582 278,307
Grants 3,730 1,754,445
Capital contribution from mutual water company (North Fork) - 233,410
Transfer of capital asset (CIP) to mutual water company (North Fork) - (1,022,033)
Total contributions and transfers 68,312 1,625,311
CHANGE IN NET ASSETS (281,410) 1,823,143
NET ASSETS - BEGINNING OF YEAR 71,685,775 69,862,632
NET ASSETS - END OF YEAR 71,404,365$ 71,685,775$
See Auditors' Report on Supplementary Information
-40-
East Valley Water District Schedule Two
Page 1 of 3
Sewer Department
Statements of Net Assets
As of June 30, 2010 and 2009
For comparative
purposes only
2010 2009
ASSETS
Current assets:
Investment in Local Agency Investment Fund -$ 981,471$
Investment in debt securities 2,870,030 3,417,633
Total current assets 2,870,030 4,399,104
Non-current assets:
Capital assets:
Utility plant in service 26,866,035 26,740,962
Less: accumulated depreciation (13,264,916) (12,832,606)
Utility plant in service, net of depreciation 13,601,119 13,908,356
Capital assets, not being depreciated 4,160,906 426,438
Total capital assets 17,762,025 14,334,794
Due from water department 7,000,000 9,022,344
Total non-current assets 24,762,025 23,357,138
Total assets 27,632,055 27,756,242
NET ASSETS
Invested in capital assets 17,762,025 14,334,794
Unrestricted 9,870,030 13,421,448
Total net assets 27,632,055$ 27,756,242$
See Auditors' Report on Supplementary Information
-41-
East Valley Water District Schedule Two
Page 3 of 3
Sewer Department
Statements of Revenues, Expenses and Changes in Net Assets (Continued)
For the years ended June 30, 2010 and 2009
For comparative
purposes only
2010 2009
OPERATING EXPENSES BEFORE DEPRECIATION 8,761,221$ 8,010,256$
Depreciation 619,273 634,054
Total Operating Expenses 9,380,494 8,644,310
Operating Income (193,218) 557,693
NON-OPERATING REVENUE:
Investment income 34,029 78,215
Gain (loss) on disposal of assets 2,081 (35,917)
Total nonoperating revenues 36,110 42,298
Income before contributions and transfers (157,108) 599,991
CONTRIBUTIONS AND TRANSFERS:
Capacity charges 32,921 111,714
Total contributions and transfers 32,921 111,714
CHANGE IN NET ASSETS (124,187) 711,705
NET ASSETS - BEGINNING OF YEAR 27,756,242 27,044,537
NET ASSETS - END OF YEAR 27,632,055$ 27,756,242$
See Auditors' Report on Supplementary Information
-43-
See Auditors' Report on Supplementary Information
-44-
East Valley Water District Schedule Three
Page 1 of 3
Supplementary Information
Water Department - Schedule of Capital Assets
As of June 30, 2010
Cost of Assets: Beginning Ending
balance Increases Decreases balance
Capital assets not being
depreciated/amortized:
Land held for future use $ 1,366,150 $ - $ 681,425 $ 684,725
Land and easements 1,854,519 5,957,755 12,936 7,799,338
Intangible plant 20,954 - - 20,954
Water stock and rights 1,551,731 1,750 - 1,553,481
Construction in progress 15,689,903 2,601,115 13,415,930 4,875,088
Total 20,483,257 8,560,620 14,110,291 14,933,586
Capital assets being
depreciated/amortized:
Source of supply plant:
Wells 8,507,863 691,017 135,450 9,063,430
North Fork intake pipeline 3,183,250 - - 3,183,250
Pumping plant:
Hydo plant 59 1,091,641 - - 1,091,641
Boosters, pumps and motors 7,364,630 - - 7,364,630
Treatment plant:
Contact clarification plant 9,670,415 - - 9,670,415
Uranium treatment plant - 755,226 - 755,226
Nitrate treatment plant - 1,281,576 - 1,281,576
Perchlorate treatment - 319,630 - 319,630
Transmission and distribution:
Pipelines and services 54,869,179 714,735 - 55,583,914
Meters 4,435,298 2,387 - 4,437,685
Telemetry and control 360,386 51,745 - 412,131
Reservoirs and tanks 16,944,466 - - 16,944,466
General plant:
Land improvements 317,456 97,072 - 414,528
Building 655,385 - - 655,385
Office furniture and
equipment 1,846,839 31,247 229,189 1,648,897
Transportation and general
equipment 2,225,863 7,747 19,600 2,214,010
Total 111,472,671 3,952,382 384,239 115,040,814
Grand total $ 131,955,928 $ 12,513,002 $ 14,494,530 $ 129,974,400
See Auditors' Report on Supplementary Information
-45-
East Valley Water District Schedule Three
Page 2 of 3
Supplementary Information
Water Department - Schedule of Capital Assets
As of June 30, 2010
Accumulated Depreciation: Beginning Ending
balance Increases Decreases balance
Capital assets being
depreciated/amortized:
Source of supply plant:
Wells $ 2,140,363 $ 197,336 $ 46,016 $ 2,291,683
North Fork intake pipeline 217,325 63,665 - 280,990
Pumping plant:
Hydo plant 59 447,573 21,833 - 469,406
Boosters, pumps and motors 2,387,270 219,356 - 2,606,626
Treatment plant:
Contact clarification plant 2,706,931 246,519 - 2,953,450
Uranium treatment plant - 37,761 - 37,761
Nitrate treatment plant - 64,079 - 64,079
Perchlorate treatment - 15,981 - 15,981
Transmission and distribution:
Pipelines and services 15,373,674 1,090,988 - 16,464,662
Meters 1,791,789 136,788 - 1,928,577
Telemetry and control 354,071 3,252 - 357,323
Reservoirs and tanks 3,965,648 346,184 - 4,311,832
General plant:
Land improvements 50,470 24,145 - 74,615
Building 351,127 17,315 - 368,442
Office furniture and
equipment 1,273,826 74,913 229,122 1,119,617
Transportation and general
equipment 1,656,181 134,889 19,600 1,771,470
Total $ 32,716,248 $ 2,695,004 $ 294,738 $ 35,116,514
See Auditors' Report on Supplementary Information
-46-
East Valley Water District Schedule Three
Page 3 of 3
Supplementary Information
Sewer Department - Schedule of Capital Assets
As of June 30, 2010
Cost of Assets: Beginning Ending
balance Increases Decreases balance
Capital assets not being
depreciated/amortized:
Land held for future use $ - $ 684,725 $ - $ 684,725
Land and easements 29,215 3,208,022 - 3,237,237
Construction in progress 397,223 91,551 249,830 238,944
Total 426,438 3,984,298 249,830 4,160,906
Capital assets being
depreciated/amortized:
Collection plant:
Wastewater pipelines and
laterals 23,417,572 261,396 - 23,678,968
General plant:
Building 264,731 - - 264,731
Office furniture and
equipment 1,208,463 40,383 167,363 1,081,483
Transportation and general
equipment 1,850,196 10,257 19,600 1,840,853
Total 26,740,962 312,036 186,963 26,866,035
Grand total $ 27,167,400 $ 4,296,334 $ 436,793 $ 31,026,941
Accumulated Depreciation: Beginning Ending
balance Increases Decreases balance
Capital assets being
depreciated/amortized:
Collection plant:
Wastewater pipelines and
laterals $ 10,374,767 $ 419,819 $ - $ 10,794,586
General plant:
Building 175,966 9,074 - 185,040
Office furniture and
equipment 947,672 39,896 167,363 820,205
Transportation and general
equipment 1,334,201 150,484 19,600 1,465,085
Total $ 12,832,606 $ 619,273 $ 186,963 $ 13,264,916
See Auditors' Report on Supplementary Information
-47-
East Valley Water District Schedule Four
Page 1 of 3
Supplementary Information
Water Department - Schedule of Changes in Capital Assets
For the year ending June 30, 2010
Increases:
Capital assets, not being depreciated/amortized:
Land: Third St. and Sterling Ave. $ 5,957,755
Water Stock: North Fork Water Company 1,750
Construction in Progress:
increase in jobs due to capital invested/donated 2,601,115
Capital assets, being depreciated/amortized:
Land Improvements:
Fencing at District yard 8,620
Plant 40 improvements 88,453
97,073
Source of supply plant:
Plant 40 - well rehabilitation 451,353
Plant 40 - on-site piping and electrical 206,196
Plant 25 - replace column, tube and shaft 33,468
691,017
Treatment plant:
Perchlorate treatment 319,630
Plant 40 - uranium treatment unit 755,226
Plant 40 - nitrate treatment unit 1,281,576
2,356,432
Transmission and distribution:
Pipeline and services:
Tract 17263 131,386
Tract 18677 155,319
New service at Patton State Hospital 37,181
New service at Highland and Boulder 68,806
New service at 3rd St., west of Palm 5,688
New 8" main at Vine St., between Tippecanoe and Fairfax 316,355
714,735
Meters:
Meter replacement program 46,999
Meters malfunctioning, installed in previous years (45,408)
New services and upgrades 796
2,387
Telemetry and controls: plant 40 51,745
Office furniture and equipment:
AVAYA phone system - handsets and software 27,777
Network switches 2,075
Phone system routers 1,395
31,247
See Auditors' Report on Supplementary Information
-48-
East Valley Water District Schedule Four
Page 2 of 3
Supplementary Information
Water Department - Schedule of Changes in Capital Assets
For the year ending June 30, 2010
Increases (continued):
Capital assets, being depreciated/amortized (continued):
Transportation and general equipment:
Compressor - Schrader #82823GTH $ 1,938
Cargo containters (3) - ECMU 4049840, 4044581 & 4044175 3,402
Pacific truck stake bed - unit 36 2,407
7,747
Total increases $ 12,513,003
Decreases:
Capital assets, not being depreciated/amortized:
Land held for future use:
Survey and title fees (capitalized) $ (3,300)
Transferred to Sewer Department 684,725
681,425
Land and easements: sale of land, Church St 12,936
Construction in progress:
decrease due to jobs completed and capitalized/expensed 13,415,930
Capital assets, being depreciated/amortized:
Source of supply plant, wells: demolition of plant 133 135,450
Office furniture and equipment:
removal of old equipment (1955-1995) no longer in service
and fully depreciated 229,189
Transportation and general equipment:
1992 Ford F-250 - unit 9 7,744
2001 GMC Safari - unit 134 11,856
19,600
Total decreases $ 14,494,530
See Auditors' Report on Supplementary Information
-49-
East Valley Water District Schedule Four
Page 3 of 3
Supplementary Information
Sewer Department - Schedule of Changes in Capital Assets
For the year ending June 30, 2010
Increases:
Capital assets, not being depreciated/amortized:
Land: Third St. and Sterling Ave. $ 3,208,022
Land held for future use: transferred from Water Department 684,725
Construction in Progress:
increase in jobs due to capital invested/donated 91,551
Capital assets, being depreciated/amortized:
Collection plant, wastewater pipelines and laterals:
Tract 17263 - collection mains and laterals 96,333
Tract 18677 - collection mains and laterals 158,101
Highland and Boulder - collection mains and laterals 6,962
261,396
Office furniture and equipment:
AVAYA phone system - handsets and software 27,778
Flexidata license 9,135
Network switches 2,075
Phone system routers 1,395
40,383
Transportation and general equipment:
Turbo II - root cutter sewer 4,448
Cargo containers (3) - ECMU 4049840, 4044581 & 4044175 3,402
Pacific truck stake bed - unit 36 2,407
10,257
Total increases $ 4,296,334
Decreases:
Capital assets, not being depreciated/amortized:
Construction in progress:
decrease due to jobs completed and capitalized/expensed $ 249,830
Capital assets, being depreciated/amortized:
Office furniture and equipment:
removal of old equipment (1955-1995) no longer in service
and fully depreciated 167,363
Transportation and general equipment:
1992 Ford F-250 - unit 9 7,744
2001 GMC Safari - unit 134 11,856
19,600
Total decreases $ 436,793
See Auditors' Report on Supplementary Information
-50-
East Valley Water District Schedule Five
Page 1 of 1
Supplementary Information
Unredeemed Bond Coupons - Retired Debt
As of June 30, 2010
Interest Bond Total
coupons principal amount
Bond series payable payable payable
1955 water revenue bonds $ 829 $ - $ 829
1957 general obligation bonds 211 - 211
1966 water revenue bonds - division I 425 - 425
1966 water revenue bonds - division II 5,010 - 5,010
$ 6,475 $ - $ 6,475
See Auditors' Report on Supplementary Information
-51-
East Valley Water District Schedule Six
Page 1 of 4
Supplementary Information
Principal and Interest Repayment Schedule - Certificates of Participation - Series 2001
As of June 30, 2010
Interest Total
Due Date Principal Rate Interest Payments
12-1-10 $ 785,000 4.250% $ 135,317 $ 920,317
6-1-11 - 4.250 118,636 118,636
12-1-11 790,000 4.250 118,636 908,636
6-1-12 - 4.400 101,849 101,849
12-1-12 820,000 4.400 101,849 921,849
6-1-13 - 4.500 83,809 83,809
12-1-13 855,000 4.500 83,809 938,809
6-1-14 - 4.625 64,571 64,571
12-1-14 900,000 4.625 64,571 964,571
6-1-15 - 4.700 43,759 43,759
12-1-15 220,000 4.700 43,759 263,759
6-1-16 - 4.800 38,589 38,589
12-1-16 230,000 4.800 38,589 268,589
6-1-17 - 4.875 33,069 33,069
12-1-17 240,000 4.875 33,069 273,069
6-1-18 - 4.875 27,219 27,219
12-1-18 250,000 4.875 27,219 277,219
6-1-19 - 5.000 21,125 21,125
12-1-19 565,000 5.000 21,125 586,125
6-1-20 - 5.000 7,000 7,000
12-1-20 280,000 5.000 7,000 287,000
Totals $ 5,935,000 $ 1,214,569 $ 7,149,569
See Auditors' Report on Supplementary Information
-52-
East Valley Water District Schedule Six
Page 2 of 4
Supplementary Information
Principal and Interest Repayment Schedule - 2004 Project Installment Sale Note
As of June 30, 2010
Interest Total
Due Date Principal Rate Interest Payments
8-31-10 $ 200,249 4.500% $ 181,525 $ 381,774
2-28-11 204,754 4.500 177,019 381,773
8-31-11 209,361 4.500 172,412 381,773
2-29-12 214,072 4.500 167,702 381,774
8-31-12 218,889 4.500 162,885 381,774
2-28-13 223,814 4.500 157,960 381,774
8-31-13 228,849 4.500 152,924 381,773
2-28-14 233,999 4.500 147,775 381,774
8-31-14 239,264 4.500 142,510 381,774
2-28-15 244,647 4.500 137,127 381,774
8-31-15 250,151 4.500 131,622 381,773
2-29-16 255,780 4.500 125,994 381,774
8-31-16 261,535 4.500 120,239 381,774
2-28-17 267,419 4.500 114,354 381,773
8-31-17 273,436 4.500 108,337 381,773
2-28-18 279,589 4.500 102,185 381,774
8-31-18 285,879 4.500 95,894 381,773
2-28-19 292,312 4.500 89,462 381,774
8-31-19 298,889 4.500 82,885 381,774
2-29-20 305,614 4.500 76,160 381,774
8-31-20 312,490 4.500 69,284 381,774
2-28-21 319,521 4.500 62,253 381,774
8-31-21 326,710 4.500 55,063 381,773
2-28-22 334,061 4.500 47,713 381,774
8-31-22 341,578 4.500 40,196 381,774
2-28-23 349,263 4.500 32,511 381,774
8-31-23 357,122 4.500 24,652 381,774
2-29-24 365,157 4.500 16,617 381,774
8-31-24 373,373 4.500 8,401 381,774
Totals $ 8,067,777 $ 3,003,661 $ 11,071,438
See Auditors' Report on Supplementary Information
-53-
East Valley Water District Schedule Six
Page 3 of 4
Supplementary Information
Principal and Interest Repayment Schedule - 2006 Project Installment Sale Note
As of June 30, 2010
Interest Total
Due Date Principal Rate Interest Payments
9-3-10 $ 108,849 4.950% $ 129,163 $ 238,012
3-3-11 111,543 4.950 126,469 238,012
9-3-11 114,304 4.950 123,708 238,012
3-3-12 117,133 4.950 120,879 238,012
9-3-12 120,032 4.950 117,980 238,012
3-3-13 123,003 4.950 115,010 238,013
9-3-13 126,047 4.950 111,965 238,012
3-3-14 129,167 4.950 108,845 238,012
9-3-14 132,364 4.950 105,648 238,012
3-3-15 135,639 4.950 102,373 238,012
9-3-15 138,997 4.950 99,016 238,013
3-3-16 142,437 4.950 95,575 238,012
9-3-16 145,962 4.950 92,050 238,012
3-3-17 149,575 4.950 88,437 238,012
9-3-17 153,277 4.950 84,735 238,012
3-3-18 157,071 4.950 80,942 238,013
9-3-18 160,958 4.950 77,054 238,012
3-3-19 164,941 4.950 73,071 238,012
9-3-19 169,024 4.950 68,988 238,012
3-3-20 173,207 4.950 64,805 238,012
9-3-20 177,494 4.950 60,518 238,012
3-3-21 181,888 4.950 56,125 238,013
9-3-21 186,389 4.950 51,623 238,012
3-3-22 191,002 4.950 47,010 238,012
9-3-22 195,729 4.950 42,283 238,012
3-3-23 200,574 4.950 37,439 238,013
9-3-23 205,537 4.950 32,475 238,012
3-3-24 210,625 4.950 27,387 238,012
9-3-24 215,838 4.950 22,174 238,012
3-3-25 221,180 4.950 16,832 238,012
9-3-25 226,654 4.950 11,358 238,012
3-3-26 232,263 4.950 5,749 238,012
Totals $ 5,218,703 $ 2,397,686 $ 7,616,389
See Auditors' Report on Supplementary Information
-54-
East Valley Water District Schedule Six
Page 4 of 4
Supplementary Information
Principal and Interest Repayment Schedule - Department of Water Resources Construction Loan
As of June 30, 2010
Interest Total
Due Date Principal Rate Interest Payments
1-1-11 $ 3,381 0.000% $ - $ 3,381
7-1-11 3,381 0.000 - 3,381
1-1-12 3,381 0.000 - 3,381
7-1-12 3,381 0.000 - 3,381
1-1-13 3,381 0.000 - 3,381
7-1-13 3,381 0.000 - 3,381
1-1-14 3,381 0.000 - 3,381
7-1-14 3,381 0.000 - 3,381
1-1-15 3,381 0.000 - 3,381
7-1-15 3,381 0.000 - 3,381
1-1-16 3,381 0.000 - 3,381
7-1-16 3,381 0.000 - 3,381
1-1-17 3,381 0.000 - 3,381
7-1-17 3,381 0.000 - 3,381
1-1-18 3,381 0.000 - 3,381
7-1-18 3,381 0.000 - 3,381
1-1-19 3,381 0.000 - 3,381
7-1-19 3,381 0.000 - 3,381
1-1-20 3,381 0.000 - 3,381
7-1-20 3,381 0.000 - 3,381
1-1-21 3,381 0.000 - 3,381
7-1-21 3,381 0.000 - 3,381
1-1-22 3,381 0.000 - 3,381
7-1-22 3,381 0.000 - 3,381
1-1-23 3,381 0.000 - 3,381
7-1-23 3,381 0.000 - 3,381
1-1-24 3,381 0.000 - 3,381
7-1-24 3,381 0.000 - 3,381
1-1-25 3,381 0.000 - 3,381
7-1-25 3,381 0.000 - 3,381
1-1-26 3,381 0.000 - 3,381
7-1-26 3,381 0.000 - 3,381
1-1-27 3,381 0.000 - 3,381
7-1-27 3,381 0.000 - 3,381
1-1-28 3,381 0.000 - 3,381
7-1-28 3,381 0.000 - 3,381
1-1-29 3,381 0.000 - 3,381
7-1-29 3,381 0.000 - 3,381
1-1-30 3,381 0.000 - 3,381
7-1-30 3,381 0.000 - 3,381
1-1-31 3,383 0.000 - 3,383
Totals $ 138,623 $ - $ 138,623
See Auditors' Report on Supplementary Information
-55-
East Valley Water District
Supplementary Information
Statement of Net Assets Comments
As of June 30, 2010
CURRENT ASSETS
Current assets are discussed in detail as shown below:
Cash
Cash consisted of the following:
Office cash funds:
Petty cash fund $ 1,000
Cashier's fund 750
Citizens Business Bank - flexible spending 6,564
Citizens Business Bank - checking 242,830
Citizens Business Bank - Arroyo Verde 56,058
Local Agency Investment Fund 3,516,638
Cash held for certificate of participation funds 480,585
Citizens Business Bank - money market 1,010,103
Total cash funds available 5,314,528
Less cash restricted for:
Certificate of participation funds - COP repayment 480,585
Customer deposits 1,659,933
Construction deposit 137,050
Arroyo Verde Assessment District 56,058
Total cash funds available 2,333,626
Unrestricted cash $ 2,980,902
Investment in debt securities
Investments consist of the following:
Certificate of participation funds - COP repayment $ 3,058,255
Accounts receivable, net
Water and sewer accounts receivable at June 30, 2010, consisted of the following:
Accounts receivable $ 1,376,697
Less: Allowance for uncollectible accounts (10,895)
$ 1,365,802
Interest receivable
Interest receivable at June 30, 2010, consisted of the following:
Local Agency Investment Fund $ 5,141
Investments in debt securities 9,070
Money market funds 94
COP installment payment funds 7
$ 14,312
See Auditors' Report on Supplementary Information
-56-
East Valley Water District
Supplementary Information
Statement of Net Assets Comments
As of June 30, 2010
CURRENT ASSETS (continued)
Other receivables
Other receivables at June 30, 2010, consisted of the following:
Developers and others $ 155,495
City Creek 32,221
North Fork 3,859
AVAD 30,013
$ 221,588
Inventory - average cost
The inventory at June 30, 2010, consisted of the following:
Water pipe, fittings, valves, etc. $ 856,905
Meters 37,730
Treatment plant 70,540
Office supplies 4,562
Automotive parts 5,740
$ 975,477
Prepaid expenses and deposits
Prepaid expenses and deposits at June 30, 2010, consisted of the following:
Prepaid insurance $ 23,720
Miscellaneous expenses and deposits 106,666
$ 130,386
NONCURRENT ASSETS
Capital assets
A schedule of the changes in Capital Assets for water and sewer are shown in Schedule Three.
Construction in progress
Construction in progress, consisting of Utility Plant additions, which were incomplete at June 30, 2010, is shown
below:
Water Department:
Plant 24 design storm drain $ 22,595
Plant 24 pumping equipment rehabilitation 32,826
Plant 27 pumping equipment rehabilitation 51,252
Plant 40 booster design and construction 2,096
Plant 134 treatment upgrade and expansion 1,764,523
Plant 147 rehabilitation 38,141
Developers projects 215,968
Water Treatment Plant (150) design and construction 1,825,125
Greenspot Rd. water treatment plant 24,246
See Auditors' Report on Supplementary Information
-57-
East Valley Water District
Supplementary Information
Statement of Net Assets Comments
As of June 30, 2010
NONCURRENT ASSETS (continued)
Construction in progress (continued)
Water Department (continued):
Harlan Ln. pipeline replacement $ 7,957
Main replacement - Live Oak Rd. 9,943
Santa Ana River discharge 206,057
Eastwood Farms Mutual Water 112,529
GIS System implementation 457,703
Facility relocations - other governmental projects 64,275
Leasehold improvements (administration) 39,852
Total water department $ 4,875,088
Sewer Department:
Sewer system management plant GAP analysis $ 142,662
Conejo sewer replacement 96,232
GIS 50
Total sewer department 238,944
Total construction in progress $ 5,114,032
Assessments receivable
Assessments are being collected from property owners
within the Arroyo Verde Assessment District to repay
State revolving fund loans used to finance water facility
improvements within the assessment district $ 83,188
Deferred charges
The deferred financing charges are additional costs incurred for the Certificates of Participation and are being
amortized over 20 years.
Amortization of these charges during 2009-2010 was as follows:
Beginning balance $ 127,566
Less: 2009-2010 amortization (31,795)
Ending Balance $ 95,771
The District has incurred incremental direct costs paid to third parties in originating lease arrangements. These
costs are being amortized over the lease term of 30 years.
Amortization of these costs during 2009-2010 is as follows:
Beginning balance $ 49,051
Less: 2009-2010 amortization (4,265)
Ending Balance 44,786
Total deferred charges $ 140,557
See Auditors' Report on Supplementary Information
-58-
East Valley Water District
Supplementary Information
Statement of Net Assets Comments
As of June 30, 2010
CURRENT LIABILITIES
Current liabilities consisting of accounts payable, accrued liabilities, accrued interest payable, deposits,
Certificates of Participation and notes payable, are discussed below:
Accounts payable
Trade accounts payable at June 30, 2010 $ 1,904,463
Accounts payable - other
Accounts payable - other at June 30, 2010, consisted of the following:
Metropolitan Water District of Southern California $ 282,561
Other accounts payable, net (debit balance) (841)
$ 281,720
Accrued payroll and benefits
Accrued payroll and benefits at June 30, 2010, consisted of the following:
Accrued payroll and benefits $ 1,368,261
Accrued pension expense 34,685
$ 1,402,946
Accrued payroll and benefits consist of accrued payroll, payroll taxes, deferred compensation, employee benefits,
and pension.
Accrued interest payable
Accrued interest payable at June 30, 2010, consisted of the following:
1955 water revenue bonds $ 829
1957 general obligation bonds 211
1966 water revenue bonds 5,435
2001 certificate of participation 22,886
2004 project installment sale note 121,017
2006 project installment sale note 86,108
$ 236,486
Current portion of long-term debt
Current portion of long-term debt at June 30, 2010, consisted of the following:
2001 certificate of participation $ 785,000
2004 project installment sale note 405,003
2006 project installment sale note 220,393
DWR Arroyo Verde Construction Loan 6,762
$ 1,417,158
See Auditors' Report on Supplementary Information
-59-
East Valley Water District
Supplementary Information
Statement of Net Assets Comments
As of June 30, 2010
LIABILITIES PAYABLE FROM RESTRICTED ASSETS
Customer service deposits
At June 30, 2010, customer service deposits amounting to $1,659,933 were held by the District to secure
payments of water sewer charges.
Construction deposits
At June 30, 2010, manhole and inspection fee deposits of $137,050 were held by the District as security against
improper construction of manholes and water and sewer lines. These deposits are refunded to contractors once
the construction is deemed satisfactory.
LONG-TERM DEBT
Schedule Six sets forth the future annual payments of the certificates of participation and notes payable.
See Auditors' Report on Supplementary Information
-60-
East Valley Water District
Supplementary Information
Water Department - Operations
For the Year Ended June 30, 2010
WATER OPERATIONS
The fiscal period ended June 30, 2010 was the fifty-sixth full year of operation for the District. The year’s
operations are shown in the Statements of Revenues, Expenses and Changes in Net Assets.
A comparative summary of water revenue and connection charges, by month, is shown below:
2008 - 2009 2009 - 2010
Billed Billed
Month Connections Revenue Connections Revenue
July 21,801 $ 1,493,304 21,955 $ 1,598,548
August 21,730 1,622,098 21,941 1,740,629
September 21,736 1,504,384 21,973 1,655,797
October 21,778 1,432,757 21,950 1,472,112
November 21,696 1,235,151 21,920 1,227,283
December 21,761 1,042,389 21,965 1,068,140
January 21,805 1,012,847 21,891 963,614
February 21,708 876,620 21,989 746,476
March 21,789 874,612 21,988 780,200
April 21,719 1,161,897 21,892 1,086,022
May 21,765 1,354,426 21,925 1,130,565
June 21,806 1,404,923 21,998 1,384,037
2009 Restatement (Note 11) (282,560) -
Totals $ 14,732,848 $ 14,853,423
The rate charged to customers for water consumption for the years end June 30, 2010 and 2009 was $1.35 per
hundred cubic feet (HCF).
Monthly meter charges and installation charges in effect during the year were as follows:
Flat rate monthly Water Connection
Size of service meter charge Charge
3/4" $ 10.45 $ 5,401
1" 14.63 7,626
1-1/2" 18.81 15,617
2" 30.30 22,369
3" 114.94 43,469
4" 146.29 71,151
6" 219.44 136,117
8" 303.04 226,983
See Auditors' Report on Supplementary Information
-61-
East Valley Water District
Supplementary Information
Sewer Department - Operations
For the Year Ended June 30, 2010
SEWER OPERATIONS
The fiscal period ended June 30, 2010 was the fifty-second full year of sewer operations for the District. The
year’s operations are shown in the Statements of Revenues, Expenses and Changes in Net Assets.
A comparative summary of sewer tolls revenue, by month, is shown below:
2008 - 2009 2009 - 2010
Billed Billed
Month Connections Revenue Connections Revenue
July 19,366 $ 785,060 19,469 $ 823,010
August 19,312 802,469 19,473 843,175
September 19,301 788,458 19,493 836,214
October 19,309 762,282 19,477 808,565
November 19,268 723,232 19,504 755,442
December 19,301 706,549 19,508 743,600
January 19,409 747,949 19,256 727,941
February 19,270 703,427 19,259 676,643
March 19,347 707,152 19,221 686,309
April 19,288 759,088 19,218 746,934
May 19,329 777,220 19,278 744,749
June 19,370 776,272 19,289 781,718
Totals $ 9,039,158 $ 9,174,300
The District’s sewer system is connected to main lines leading to the Sewage Disposal Plant operated by the City
of San Bernardino. The District pays the City for the treatment of the District's sewage. Under the current
agreement, the City and the District agreed to a uniform regional sewer rate. A summary of payments over the
previous ten years is shown below:
Total customer Payments
Fiscal year billing to City
2000-01 $ 5,885,051 $ 4,396,629
2001-02 5,991,709 4,495,040
2002-03 6,085,516 4,557,909
2003-04 6,622,588 4,771,339
2004-05 7,423,533 5,288,212
2005-06 7,733,908 5,473,390
2006-07 8,139,600 5,607,172
2007-08 8,505,060 5,561,831
2008-09 9,039,158 5,631,258
2009-10 9,174,300 5,665,046
Monthly residential sewer rates in effect during the year ended June 30, 2010 were as follows:
West of City Creek $ 26.09
East of City Creek 28.09
Sewer connection charges in effect during the year ended June 30, 2010 were as follows:
Permit charge $ 25.00 / connection
Inspection charge 75.00 / connection
Connection charge 645.00 / EDU or portion thereof
Trunk sewer charge 158.00 / EDU or portion thereof