HomeMy WebLinkAbout2011-01-10 - Finance-Accounting Committee Meeting Minutes
MINUTES OF THE
YORBA LINDA WATER DISTRICT
FINANCE-ACCOUNTING COMMITTEE MEETING
January 10, 2011
A meeting of the Finance-Accounting Committee was called to order by Director Collett
at 4:00 p.m. The meeting was held at the District's Administrative Office at 1717 E
Miraloma Ave, Placentia CA 92870.
COMMITTEE STAFF
Director Ric Collett, Chair Ken Vecchiarelli, General Manager
Director Robert R. Kiley Stephen Parker, Finance Director
1. PUBLIC COMMENTS
None.
2. ACTION CALENDAR
2.1. California Employers' Retirement Benefit Trust Fund
Mr. Parker explained that GASB 45 requires actuarials to be done every
two years to determine the long-term cost of offering Other Post-
Employment Benefits (OPEB). In the District's case the benefit given to
retirees is one year of health insurance coverage for every three years
worked at the District. The actuary determines an Annual Required
Contribution (ARC) which must be spent on OPEB costs annually or
shown as a liability on the District's balance sheet. The last two fiscal
years, the District paid retirees' pay-as-you-go costs, which were
approximately $100,000 annually, but fell short of the actuarially
determined $217,979. Therefore, the difference was added as a liability
on the District's balance sheet. In the current year, the District budgeted
for the entire ARC, but until the money is placed in a trust (or remitted to
vendors for retiree health insurance costs) it will not formally fund the
ARC. Staff provided information on CaIPERS' California Employers'
Retiree Benefit Trust (CERBT) which could accept the District's prefunding
of OPEB costs. The Committee asked a number of questions relating to
GASB 45, OPEB costs and the CERBT that Mr. Vecchiarelli and Mr.
Parker responded to. The Committee supported staff's recommendation
that the agreement and resolution be brought to the full Board for
consideration at the second Board meeting in January.
2.2. November 2010 Budget to Actual Results
Mr. Parker presented the November 2010 budget to actual results. A wet
year and water demands trending well below normal continue to have the
biggest affect on revenues and expenses. Year-to-date Water Operating
Revenues are 44% of budget at the five-month mark (42% of the way
through the year). Variable Water Costs continue to be slightly higher at
47% as a result of the District's operational strategy to purchase a higher
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percentage of import water prior to the January 1, 2011 Metropolitan
Water District water rate increase. Overall, Operating Expenses are
trending at 41% - very near the budgeted expectation. The Committee
asked questions, discussed various details, received and filed the
November 2010 Budget to Actual Results.
2.3. November 2010 Investment Report
Mr. Parker presented the November 2010 Investment Report. Yield went
up slightly to 0.81%. Mr. Parker described how some unrealized
investment losses negatively affected non-operating revenue numbers
while discussing item 2.2, and explained the difference between interest
income and investment value. Mr. Parker shared that the Sewer Capital
Project Fund increased approximately $284,000, primarily due to payment
by Metropolitan Water District (MWD) of a sewer capital and capacity fee
related to a revised sewer service agreement. Mr. Vecchiarelli described
the history relating to the Diemer Sewer Agreement and negotiation of the
Capital Fee received in November from MWD. Mr. Parker explained
increases in the Water Reserve for Debt Service and Water Operating
Funds, and explained a decrease in the 2008 Certificate of Participation
(COP or "Revenue") Bonds as a result of Capital Improvement Project
(CIP) payments made for projects in progress.
3. DISCUSSION ITEMS
3.1. Sewer Financial Projections
Mr. Parker presented a preliminary analysis of Sewer Fund cash flows and
projected capital project reserves trending five years into the future. The
projections compared results with and without the additional maintenance
of the City of Yorba Linda Sewer System. Mr. Parker explained the
assumptions and detailed the capital items that would need to be
budgeted under both options, as well as studies, reports and updates to
information systems the District has for its existing Sewer System.
3.2. Future Agenda Items and Staff Tasks
Director Collett explained that he could not make the next regularly
scheduled Finance-Accounting Committee meeting, and after discussion
with all parties, a re-scheduled meeting time was agreed upon.
4. ADJOURNMENT
4.1. The Committee adjourned at 5:15 p.m. The next regular meeting of the
Finance-Accounting Committee will be held on February 8, 2011 at 9:30
a. m.
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