HomeMy WebLinkAbout2011-04-11 - Finance-Accounting Committee Meeting Agenda Packet
Yorba Linda
Water District
AGENDA
YORBA LINDA WATER DISTRICT
FINANCE-ACCOUNTING COMMITTEE MEETING
Monday, April 11, 2011, 4:00 PM
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
Any individual wishing to address the committee is requested to identify themselves and state the matter on
which they wish to comment. If the matter is on this agenda, the committee Chair will recognize the individual for
their comment when the item is considered. No action will be taken on matters not listed on this agenda.
Comments are limited to matters of public interest and matters within the jurisdiction of the Water District.
Comments are limited to five minutes.
2. ACTION CALENDAR
This portion of the agenda is for items where staff presentations and committee discussions are needed prior to
formal committee action.
2.1. February 2011 Budget to Actual Results
Recommendation: That the Committee review, receive and file the February 2011
Budget to Actual Results.
2.2. February 2011 Investment Report
Recommendation: That the Committee receive and file the February 2011
Investment Report.
3. DISCUSSION ITEMS
This portion of the agenda is for matters such as technical presentations, drafts of proposed policies, or similar
items for which staff is seeking the advice and counsel of the Committee members. This portion of the agenda
may also include items for information only.
3.1. Preliminary 2012 Budget Numbers
3.2. FY 2011/12 Budget Calendar Update
3.3. Draft Finance Department Budget
3.4. Investment Policy Annual Review
3.5. Annual Reserve Policy Review
3.6. Future Agenda Items and Staff Tasks
4. ADJOURNMENT
4.1. The next regular meeting of the Finance-Accounting Committee will be held on May 9,
2011 at 4:00 p.m.
Items Distributed to the Committee Less Than 72 Hours Prior to the Meeting
Pursuant to Government Code section 54957.5, non-exempt public records that relate to open session agenda items
and are distributed to a majority of the Committee less than seventy-two (72) hours prior to the meeting will be available
for public inspection in the lobby of the District's business office located at 1717 E. Miraloma Avenue, Placentia, CA
92870, during regular business hours. When practical, these public records will also be made available on the District's
internet website accessible at http://www.ylwd.com/.
Accommodations for the Disabled
Any person may make a request for a disability-related modification or accommodation needed for that person to be
able to participate in the public meeting by telephoning the Executive Secretary at 714-701-3020, or writing to Yorba
Linda Water District, P.O. Box 309, Yorba Linda, CA 92885-0309. Requests must specify the nature of the disability and
the type of accommodation requested. A telephone number or other contact information should be included so the
District staff may discuss appropriate arrangements. Persons requesting a disability-related accommodation should
make the request with adequate time before the meeting for the District to provide the requested accommodation.
ITEM NO. 2.1
AGENDA REPORT
Meeting Date: April 11, 2011
To: Finance-Accounting Committee
From: Ken Vecchiarelli, General
Manager
Presented By: Stephen Parker, Finance Dept: Finance
Director
Prepared By: Delia Lugo, Senior Accountant
Subject: February 2011 Budget to Actual Results
STAFF RECOMMENDATION:
That the Committee review, receive and file the February 2011 Budget to Actual Results.
DISCUSSION:
Attached are the District's budget to actual summary results for the Water Fund, Sewer Fund and a
combined statement for both funds pertaining to the reporting month of February 2011. Overall, the
District revenue is trending below expectations due to lower water consumption from above normal
rainfall and cooler temperatures. Water operating revenue is only 61.9% of annual budget, which is
lower by approximately 3.6% from the normal trend for the reporting 8 months of the fiscal year. The
budget was based on 15% conservation (i.e. reduced demands), and through February customer
demands are down by 23% year to date. Variable water costs as a percentage of budget are slightly
lower than operating revenues.
The majority of the individual supplies and services expenses are trending below or on budget, with
a few exceptions that have been previously discussed in Finance-Accounting Committee meetings.
District Activities/Employee Recognition has exceeded its budget due to the change in proposed
plans for the District's annual employee recognition event. Fees & Permits as well as Materials
expenses are significantly above budget due to the timing of payment due dates.
While we are 67% through the fiscal year, we have reached only 12% of the District's budgeted net
loss of $2.2 million resulting in a positive trend of over $1.2 million as compared to the budget.
PRIOR RELEVANT BOARD ACTION(S):
On March 15, 2011 the Committee reviewed, received and filed the January 31, 2011 Budget to
Actual Results.
ATTACHMENTS:
Name: Description: Type:
Water _Sewer _February 2011.xls February 2011 Consolidated Statement Backup Material
Water February 2011.xls February 2011 Water Statement Backup Material
Sewer February 201 1.xls February 2011 Sewer Statement Backup Material
Yorba Linda Water District
Summary Financial Report
Water & Sewer Funds
For Eight Months Ending February 28, 2011
Annual Actual YTD
Budget YTD through Under/(Over) %of
FY 10/11 February 28, 2011 Budget Annual Budget
Revenue (Operating):
Water Revenue (Consumption & Flat Charge) $25,672,831 $15,769,561 $9,903,270 61.43%
Sewer Revenue 1,235,402 862,764 $372,638 69.84%
Other 714,221 566,427 $147,794 79.31%
Total Operating Revenue: 27,622,454 17,198,752 10,423,702 62.26%
Expenses (Operating):
Variable Water Costs (G.W., Import & Power) 12,667,236 7,736,147 4,931,089 61.07%
Salary Related Expenses 7,624,683 4,274,006 3,350,677 60.12%
Supplies & Services 3,987,702 2,096,447 1,891,255 52.57%
Depreciation & Amortization 52017,876------------------ 3,494535 1,523,341 69.64%
Total Operating Expenses: 29,297,497 17,601,135 11,696,362 60.08%
Operating Income (Loss) (1,675,043) (402,383) (1,272,660) 24.02%
Revenue (Non-Operating):
Interest and Investments 156,000 178,385 (22,385) 114.35%
Property Taxes 1,206,000 713,605 492,395 59.17%
Other 126,133 564,617 (438-,-484)- 447.64%
Total Non-Operating Revenue: 1,488,133 1,456,607 31,526 97.88%
Expenses (Non-Operating):
Interest on Long Term Debt (1,940,954) (1,279,111) (661,843) 65.90%
Other Expense (103,193) (52,206) (50,987) 50.59%
Total Non-Operating Expenses: (2,044,147) (1,331,317) (712,830) 65.13%
Non-Operating Income (Loss) (556,014) 125,290 (681,304) -22.53%
Net Income (Loss) ($2,231,057) ($277,093) ($1,953,964) 12.42%
Contributed Capital 145,860 445,168 (299,308) 305.20%
Capital - Direct Labor - 309,862 273,271
Yorba Linda Water District
Water Fund
For Eight Months Ending February 28, 2011
FY 2011 YTD % of
Annual February Actual Under/(Over) Annual
Budget 2011 YTD Budget Budget
Revenue (Operating):
Water Revenue (Residential) $ 17,248,481 $ 1,143,820 $ 10,036,944 $ 7,211,537 58.19%
Water Revenue (Commercial & Fire Det.) 1,522,341 139,623 1,206,592 315,749 79.26%
Water Revenue (Landscape/Irrigation) 3,588,335 186,672 2,370,516 1,217,819 66.06%
Water Revenue (Service Charge) 3,313,674 279,727 2,155,509 1,158,165 65.05%
Other Operating Revenue 701,089 37,756 562,748 138,341 80.27%
Total Operating Revenue: 26,373,920 1,787,598 16,332,309 10,041,611 61.93%
Expenses (Operating):
Variable Water Costs (G.W., Import & Power) 12,666,536 583,522 7,735,660 4,930,876 61.07%
Salary Related Expenses 6,809,598 461,467 3,803,245 3,006,353 60.35%
Supplies & Services:
Communications 374,576 21,956 150,741 223,835 40.24%
Contractual Services 708,372 61,979 474,364 234,008 66.97%
Data Processing 102,771 2,516 38,444 64,327 37.41%
Dues & Memberships 30,778 3,655 24,900 5,878 80.90%
Fees & Permits 44,020 384 41,734 2,286 94.81%
Board Election 72,800 32,337 32,485 40,315 0.00%
Insurance 314,314 - 163,174 151,140 51.91%
Materials 337,982 34,807 275,795 62,187 81.60%
District Activities, Emp Recognition 11,648 6,207 12,247 (599) 105.14%
Maintenance 325,227 20,265 89,303 235,924 27.46%
Non-Capital Equipment 92,611 1,415 30,633 61,978 33.08%
Office Expense 41,221 3,330 18,616 22,605 45.16%
Professional Services 632,764 28,264 243,691 389,073 38.51%
Training 48,147 804 13,830 34,317 28.72%
Travel & Conferences 40,830 2,219 12,234 28,596 29.96%
Uncollectible Accounts 45,955 - 5,612 40,343 12.21%
Utilities 111,930 7,716 65,297 46,633 58.34%
Vehicle Equipment 256,302 46,603 162,539 93,763 63.42%
Supplies & Services Sub-Total 3,592,248 274,457 1,855,639 1,736,609 51.66%
Depreciation & Amortization 4,403,257 390,718 3,091,746 1,311,511 70.21%
Total Operating Expenses 27,471,639 1,710,164 16,486,290 10,985,349 60.01%
Operating Income (Loss) (1,097,719) 77,434 (153,981) (943,738) 14.03%
Revenue (Non-Operating):
Interest 142,000 21,274 163,922 (21,922) 115.44%
Property Taxes 1,206,000 7,096 713,605 492,395 59.17%
Other Non-Operating Revenue 100,687 34,325 536,182, (435,495) 532.52%
Total Non-Operating Revenue: 1,448,687 62,695 1,413,709 34,978 97.59%
Expenses (Non-Operating):
Interest on Long Term Debt (1,940,954) (158,855) (1,279,111) (661,843) 65.90%
Other Expense (102,193) (2,947) (44,339) (57,854) 43.39%
Total Non-Operating Expenses: (2,043,147) (161,802) (1,323,450) (719,697) 64.78%
Non-Operating Income (Loss) (594,460) (99,107) 90,259 (684,719) -15.18%
Total Income (Loss) $ (196929179) $ (219673) $ (639722) (1,628,457) 3.77%
Contributed Capital $ 92,807 $ - $ 118,531 $ (25,724) 127.72%
,Capital - Direct Labor $ 35,435 $ 306,362 $ 306,362 1 .1
Yorba Linda Water District
Sewer Fund
For Eight Months Ending February 28, 2011
FY 2011 YTD % of
Annual February Actual Underi(Over) Annual
Budget FY 2011 YTD Budget Budget
Revenue (Operating):
Sewer Charge Revenue $ 1,132,574 $ 97,392 $ 803,703 $ 328,871 70.96%
Locke Ranch Assessments 102,828 14 59,060 43,768 57.44%
Other Operating Revenue 13,132 261 3,680 9,452 28.02%
Total Operating Revenue: 1,248,534 97,667 866,443 382,091 69.40%
Expenses (Operating):
Variable Costs (Power) 700 107 487 213 69.57%
Salary Related Expenses 815,085 54,926 470,761 344,324 58.19%
Supplies & Services:
Communications 39,284 2,171 15,076 24,208 38.38%
Contractual Services 61,613 3,170 40,627 20,986 65.94%
Data Processing 10,164 249 3,803 6,361 37.42%
Dues & Memberships 3,340 361 2,606 734 78.02%
Fees & Permits 6,382 16 4,545 1,837 71.22%
Board Election 7,200 3,198 3,213 3,987 44.63%
Insurance 31,086 - 16,139 14,947 51.92%
Materials 18,833 1,173 15,689 3,144 83.31%
District Activities 1,152 614 11211 (59) 105.12%
Maintenance 41,973 5,271 36,145 5,828 86.11%
Non-Capital Equipment 20,509 1,633 71806 12,703 38.06%
Office Expense 3,879 329 1,827 2,052 47.10%
Professional Services 66,576 3,008 28,082 38,494 42.18%
Training 5,629 67 2,273 3,356 40.38%
Travel & Conferences 4,371 219 1,200 3,171 27.45%
Uncollectible Accounts 4,545 - 555 3,990 12.21%
Utilities 11,070 763 6,439 4,631 58.17%
Vehicle Equipment 57,849 5,483 53,572 4,277 92.61%
Supplies & Services Sub-Total 395,455 27,725 240,808 154,647 60.89%
Depreciation & Amortization 614,619 50,966 402,789 211,830 65.53%
Total Operating Expenses 1,825,859 133,724 1,114,845 711,014 61.06%
Operating Income (Loss) (577,325) (36,057) (248,402) (328,923) 43.03%
Revenue (Non-Operating):
Interest 14,000 1,764 14,463 (463) 103.31%
Other Non-Operating Revenue 25,446 (98) 28,435 (2,989) 111.75%
Total Non-Operating Revenue: 39,446 1,666 42,898 (31452) 108.75%
Expenses (Non-Operating):
Other Expense (1,000) (7,867) 6,867 786.70%
Total Non-Operating Expenses: (1,000) - (7,867) 6,867 786.70%
Non-Operating Income (Loss) 38,446 1,666 35,031 3,415 91.12%
Total Income (Loss) $ (538,879) $ (34,391) $ (213,371) $ (325,508) 39.60%
Contributed Capital $53,053 - 326,637 (273,584) 615.68%
Capital - Direct Labor - (1,156) (3,500) $3,500 0.00%
ITEM NO. 2.2
AGENDA REPORT
Meeting Date: April 11, 2011
To: Finance-Accounting Committee
From: Ken Vecchiarelli, General
Manager
Presented By: Stephen Parker, Finance Dept: Finance
Director
Prepared By: Delia Lugo, Senior Accountant
Subject: February 2011 Investment Report
SUMMARY:
Government Code Section 53607, et, seq., requires the person delegated to invest funds to make a
quarterly report of the investments to the legislative body.
STAFF RECOMMENDATION:
That the Committee receive and file the February 2011 Investment Report.
DISCUSSION:
Staff is submitting the February 2011 Monthly Investment Report for your review and approval. The
Investment Portfolio Report presents the market value and percent yield for all the District
investments by institution. The Investment Report Summary includes budget and actual interest and
average term portfolio information as well as market value broken out by reserves categories.
The total yield for the month ending February 2011 rose 25% to 1.04% as a result of the yield in
CaITRUST's Short Term fund increasing from 0.47% to 0.73%, and the yield in CaITRUST's
Medium Term fund increasing from 1.25% to 1.56%. The Water Operating fund has increased by
approximately $951,854 and the Water Capital fund has decreased by approximately $1.3 million.
This is primarily due to a reconciliation of Water Operating fund dollars that had been stored in the
Water Capital fund prior to the establishment of a Water Operating fund at CaITRUST.
PRIOR RELEVANT BOARD ACTION(S):
Monthly Investment Reports are presented to the Finance-Accounting Committee on a regular
basis. Quarterly Investment Reports are presented to the Board of Directors. The Investment
Report for the month ended January 31, 2011 was received and filed by the Finance-Accounting
Committee on March 15, 2011. The Investment Report for the quarter ended December 31, 2010
was received and filed by the Board of Directors on February 10, 2011.
ATTACHMENTS:
Name: Description: Type:
Invst Rpt 2-11.xlsx Investment Report Backup Material
Agenda, Apr 11 th_backup-Feb _2011.docx Agenda Backup Backup Material
Yorba Linda Water District
Investment Portfolio Report
February 28, 2011
Market % Percent
Value Cost of Total Institution Yield
Cash & Checking Accounts:
$ 294,363 $ 294,363 Wells Fargo Bank
$ 294,363 $ 294,363 0.92% Total 0.00%
Money Market Accounts:
$ 421,801 $ 421,801 Wells Fargo Money Market 0.30%
$ 421,801 $ 421,801 1.33% Total 0.30%
$ 716,164 $ 716,164 2.26% Sub-total 0.30%
Money Market Account:
$ 8,231,331 $ 8,231,331 US Bank 2008 Revenue Bond 0.20%
$ 8,231,331 $ 8,231,331 26.03% 0.20%
CaITRUST
$ 94,889 $ 94,889 Heritage Money Market Fund 0.21%
$ 5,071,851 $ 5,046,126 Ca1TRUST Short Term 0.73%
$ 17,507,154 $ 17,278,501 Ca1TRUST Medium Term 1.56%
$22,673,893 $22,419,516 71.71% 1.37%
$ 31,621,389 $ 31,367,012 100% Total Investments 1.04%
Per Government Code requirements, the Investment Report is in compliance with the Yorba
Linda Water District's Investment Policy, and there are adequate funds available to meet
budgeted and actual expenditures for the next six months.
Delia Lugo, Senior Accountant
2/28/11
Investment Report Summary
Below is a chart summarizing the yields as well as terms and maturities for the month of
February 2011:
Avg. Portfolio Avg. Portfolio # of Avg. Term
Month Yield Without Yield With Days to of Portfolio
of 2010 CaITRUST CaITRUST Maturity in Days
February 0.20% 1.04% 368 257
Below is a chart comparing operating fund interest for current and prior fiscal years.
Actual Interest 02/28/10 02/28/11
Monthly - February $21,802 $23,038
Year-to-Date $159,092 $178,385
Budget 2009/2010 2010/2011
Interest Budget, February YTD $85,267 $104,000
Interest Budget, Annual $127,900 $156,000
Interest earned on investments is recorded in the Fund that owns the investment.
Investment Summary Comparison
The distribution of investments in the portfolio both in dollars and as a percentage of the total
portfolio by funds is as follows:
Fund Description Balance 02/28/11
Water Operating $1,052,178 3.26%
Water Emergency Reserve 2,071,638 6.44%
Water Capital Project Reserve 17,823,415 55.37%
Water Reserve for Debt Service 811,345 2.52%
COP Revenue Bond 2008 - Reserve 2,147,096 6.67%
COP Revenue Bond 2008 6,084,235 18.90%
Sewer Operating 478,031 1.48%
Sewer Emergency Reserve 1,005,171 3.12%
Sewer Capital Project Reserve 717,710 2.24%
$32,190,819 100.00%
Wells Fargo Bank Checking
Water Operating (521,624)
Sewer Operating 4( 7,806)
56( 9,430)
Total 31.621.389
ITEM NO. 3.1
AGENDA REPORT
Meeting Date: April 11, 2011
To: Finance-Accounting Committee
From: Ken Vecchiarelli, General
Manager
Presented By: Stephen Parker, Finance Dept: Finance
Director
Reviewed by Legal: N/A
Prepared By: Stephen Parker, Finance
Director
Subject: Preliminary 2012 Budget Numbers
SUMMARY:
Presented for review and discussion is the preliminary FY 2011/12 budget revenues and expenses
for the District. This information is being presented to the Finance-Accounting Committee for
information prior to next month's draft budget being presented to the entire Board.
DISCUSSION:
Staff has gathered information from every department including: supplies and services, personnel
and vehicle equipment and capital outlay needs.
Comparing the supplies and services total to the FY 2010/11 budget, the current years' proposed
expenses have decreased by 7%.
Vehicle equipment and capital outlay has increased by 132% compared to the FY 2010/11.
However, the increase is mostly related to a required purchase of a new sewer vactor truck, which
accounts for $420,000 of the $774,850 budget. With the vactor taken out, the increase over the
prior year is only 6%.
Preliminary personnel expenses do not currently include any cost of living allowance, but does
factor in potential step increases for merit as well as signficant increases in health insurance and
PERS expenses. Despite these increases, personnel expenses are up only 3% from 2010/11
budget numbers.
In our preliminary numbers, depreciation has increased by only $90,000, or 2% over the prior years'
budget.
The largest increase in expense, however, relates to variable water costs, as Metropolitan Water
District of Southern California is increasing rates approximately 7.5% on January 1, 2012. The
Board did pass through this rate increase as well as the January 1, 2011 MET rate increase with a
$0.53 increase on the fixed charge that took effect August 1, 2010. In addition, this budget expects
an increase in consumption over the prior year. Variable water costs are expected to increase
slightly over $1 million (8%) higher than the 2011/12 budget.
With the assumption of increased consumption, operating revenues have increased by almost $2.4
million, or 9% from the 2010/11 budget.
ATTACHMENTS:
Preliminary 2012 Budget Combined.xlsx Combined Backup Material
Preliminary 2012 Budget Water.xlsx Water Backup Material
Preliminary 2012 Budget Water.xlsx Sewer Backup Material
Revised 2012 Budget Numbers.pdf Revised Report Backup Material
Yorba Linda Water District
Water and Sewer Enterprise
(Prior Year Budget, Forecast & Current Year Budget)
Budget Forecast Budget
FY 2010/11 FY 2010/11 FY 2011/12
Revenue (Operating):
Water Revenue (Residential) $17,248,481 $14,437,084 $18,710,234
Water Revenue (Commercial & Fire Det.) 1,522,341 1,752,207 1,667,028
Water Revenue (Landscape/Irrigation) 3,588,335 3,301,660 3,762,173
Service Charges 3,313,674 3,246,329 3,378,240
Sewer Charge Revenue 1,112,574 1,205,500 1,586,566
Locke Ranch Assessments 102,828 102,828 102,828
Other Operating Revenue 607,240 773,590 665,905
Total Operating Revenue 27,495,473 24,819,198 29,872,974
Revenue (Non-Operating):
Interest 156,000 240,255 220,000
Property Taxes 1,200,000 1,200,000 1,232,000
Other Non-Operating Revenue 253,114 633,950 514,152
Total Non-Operating Revenue 1,609,114 2,074,205 1,966,152
Total Revenue 29,104,587 26,893,403 31,839,126
Expenses (Operating):
Depreciation & Amortization 5,017,876 5,029,042 5,109,837
Variable Water Costs (G.W., Import & Power) 12,667,236 10,750,147 13,698,538
Salary Related Expenses 7,624,683 6,669,204 7,877,425
Supplies & Services:
Communications 415,860 263,810 320,250
Contractual Services 768,485 493,194 577,420
Data Processing 120,435 112,649 127,9OO
Dues & Memberships 34,118 33,232 36,137
Fees & Permits 50,402 127,641 148,880
Board Election 80,OOO 35,6OO
Insurance 345,4OO 242,100 238,100
Materials 356,615 410,937 378,345
District Activities, Emp Recognition 12,8OO 13,459 17,OOO
Maintenance 367,2OO 454,332 428,670
Non-Capital Equipment 113,120 80,605 97,220
Office Expense 43,100 38,532 53,975
Professional Services 705,4OO 481,977 677,2OO
Training 51,050 29,981 48,725
Travel & Conferences 44,950 23,955 52,350
Uncollectible Accounts 50,500 38,OOO 38,OOO
Utilities 123,OOO 107,603 123,2OO
Vehicle Equipment 314,150 324,168 350,450
Supplies & Services Sub-Total 3,996,585 3,311,775 3,713,822
Total Operating Expenses 29,306,380 25,760,168 30,399,622
Expenses (Non-Operating):
Interest on Long Term Debt 1,940,954 1,940,954 1,906,426
Job Closing Expense - - 30,OOO
Other Expense 103,193 65,060 93,193
Total Non-Operating Expenses 2,044,147 2,006,014 2,029,619
Total Expenses 31,350,527 27,766,182 32,429,241
Income (Loss) (2.245.9401 87( 2.7791 59( 0.1151
Principle on Long Term Debt (855,OOO) (855,OOO) (890yOOO)
Vehicle & Capital Equipment (334,550) (334,550) (774,850)
Yorba Linda Water District
Water Enterprise
(Prior Year Budget, Forecast & Current Year Budget)
Budget Forecast Budget
FY 2010/11 FY 2010/11 FY 2011/12
Revenue (Operating):
Water Revenue (Residential) $17,248,481 $14,437,084 $18,710,234
Water Revenue (Commercial & Fire Det.) 1,522,341 1,752,207 1,667,028
Water Revenue(LandscapeArrigation) 3,588,335 3,301,660 3,762,173
Service Charges 3,313,674 3,246,329 3,378,240
Other Operating Revenue 574,108 760,590 652,773
Total Operating Revenue 26,246,939 23,497,870 28,170,448
Revenue (Non-Operating):
Interest 142,000 218,560 200,000
Property Taxes 1,200,000 1,200,000 1,232,000
Other Non-Operating Revenue 227,668 620,065 498,329
Total Non-Operating Revenue 1,569,668 2,038,625 1,930,329
Total Revenue 27,816,607 25,536,495 30,100,777
Expenses (Operating):
Depreciation & Amortization 4,403,257 4,422,263 4,500,000
Variable Water Costs (G. W., Import & Power) 12,667,236 10,750,147 13,698,538
Salary Related Expenses 6,809,598 5,935,600 6,823,871
Supplies & Services:
Communications 376,576 241,210 295,972
Contractual Services 707,007 432,194 536,739
Data Processing 109,596 106,949 118,947
Dues & Memberships 30,778 29,932 33,398
Fees & Permits 44,020 121,241 135,490
Board Election 72,800 32,400 -
Insurance 314,314 221,000 221,433
Materials 337,766 391,337 353,244
District Activities, Emp Recognition 11,648 12,059 15,810
Maintenance 325,227 409,132 368,603
Non-Capital Equipment 92,611 68,905 79,221
Office Expense 39,221 35,832 51,072
Professional Services 638,224 439,877 630,256
Training 45,735 26,581 44,080
Travel & Conferences 40,602 22,155 48442
Uncollectible Accounts 45,955 34,600 35,340
Utilities 111,930 97,903 113,925
Vehicle Equipment 285,877 257,168 278,209
Supplies & Services Sub-Total 3,629,887 2,980,475 3,360,181
Total Operating Expenses 27,509,978 24,088,485 28,382,590
Expenses (Non-Operating):
Interest on Long Term Debt 1,940,954 1,981,300 1,940,954
Job Closing Expense - - 25,000
Other Expense 102,193 57,193 92,193
Total Non-Operating Expenses 2,043,147 2,038,493 2,058,147
Total Expenses 29,553,125 26,126,978 30,440,737
Income (Loss) (1.736.518) 59( 0.483) 33( 9.960)
Principle on Long Term Debt (855,000) (855,000) (890,000)
Vehicle & Capital Equipment (244,550) (244,550) (254,850)
Yorba Linda Water District
Water Enterprise
(Prior Year Budget, Forecast & Current Year Budget)
Budget Forecast Budget
FY 2010/11 FY 2010/11 FY 2011/12
Revenue (Operating):
Water Revenue (Residential) $17,248,481 $14,437,084 $18,710,234
Water Revenue (Commercial & Fire Det.) 1,522,341 1,752,207 1,667,028
Water Revenue(LandscapeArrigation) 3,588,335 3,301,660 3,762,173
Service Charges 3,313,674 3,246,329 3,378,240
Other Operating Revenue 574,108 760,590 652,773
Total Operating Revenue 26,246,939 23,497,870 28,170,448
Revenue (Non-Operating):
Interest 142,000 218,560 200,000
Property Taxes 1,200,000 1,200,000 1,232,000
Other Non-Operating Revenue 227,668 620,065 498,329
Total Non-Operating Revenue 1,569,668 2,038,625 1,930,329
Total Revenue 27,816,607 25,536,495 30,100,777
Expenses (Operating):
Depreciation & Amortization 4,403,257 4,422,263 4,500,000
Variable Water Costs (G. W., Import & Power) 12,667,236 10,750,147 13,698,538
Salary Related Expenses 6,809,598 5,935,600 6,823,871
Supplies & Services:
Communications 376,576 241,210 295,972
Contractual Services 707,007 432,194 536,739
Data Processing 109,596 106,949 118,947
Dues & Memberships 30,778 29,932 33,398
Fees & Permits 44,020 121,241 135,490
Board Election 72,800 32,400 -
Insurance 314,314 221,000 221,433
Materials 337,766 391,337 353,244
District Activities, Emp Recognition 11,648 12,059 15,810
Maintenance 325,227 409,132 368,603
Non-Capital Equipment 92,611 68,905 79,221
Office Expense 39,221 35,832 51,072
Professional Services 638,224 439,877 630,256
Training 45,735 26,581 44,080
Travel & Conferences 40,602 22,155 48442
Uncollectible Accounts 45,955 34,600 35,340
Utilities 111,930 97,903 113,925
Vehicle Equipment 285,877 257,168 278,209
Supplies & Services Sub-Total 3,629,887 2,980,475 3,360,181
Total Operating Expenses 27,509,978 24,088,485 28,382,590
Expenses (Non-Operating):
Interest on Long Term Debt 1,940,954 1,981,300 1,940,954
Job Closing Expense - - 25,000
Other Expense 102,193 57,193 92,193
Total Non-Operating Expenses 2,043,147 2,038,493 2,058,147
Total Expenses 29,553,125 26,126,978 30,440,737
Income (Loss) (1.736.518) 59( 0.483) 33( 9.960)
Principle on Long Term Debt (855,000) (855,000) (890,000)
Vehicle & Capital Equipment (244,550) (244,550) (254,850)
Yorba Linda Water District **REVISED**
Water and Sewer Enterprise
(Prior Year Budget, Forecast & Current Year Budget)
. Budget Forecast Budget
FY 2010111 FY 2010171 FY 2011/12
Revenue (Operating):
Water Revenue (Residential) $17,248,481 $14,437,084 $18,183,416
Water Revenue (Commercial & Fire Det.) 1,522,341 1,752,207 1,342,034
Water Revenue(Landscape/Irrigation) 3,588,335 3,301,660 3,835,552
Service Charges 3,313,674 3,246,329 3,378,240
Sewer Charge Revenue 1,112,574 1,205,500 1,586,566
Locke Ranch Assessments 102,828 102,828 102,828
Other Operating Revenue 607,240 773,590 665.905
Total Operating Revenue 27.495.473 24.819.198 29,094,541
Revenue (Non-Operating):
Interest 156,000 240,255 220,000
Property Taxes 1,200,000 1,200,000 1,232,000
Other Non-Operating Revenue 253.114 633.950 514,152
Total Non-Operating Revenue 1,609.11 4 2.074.205 1.966.152
Total Revenue 29,104.587 26,893,403 31.060.693
Expenses (Operating):
Depreciation & Amortization 5,017,876 5,029,042 5,109,837
Variable Water Costs (G.W., Import & Power) 12,667,236 10,750,147 13,698,538
Salary Related Expenses 7,624,683 6,669,204 7,877,425
Supplies & Services:
Communications 415,860 263,810 320,250
Contractual Services 768,485 493,194 577,420
Data Processing 120,435 112,649 127,900
Dues & Memberships 34,118 33,232 36,137
Fees & Permits 50,402 127,641 148,880
Board Election 80,000 35,600
Insurance 345,400 242,100 238,100
Materials 356,615 410,937 378,345
District Activities, Emp Recognition 12,800 13,459 17,000
Maintenance 367,200 454,332 426,670
Non-Capital Equipment 113,120 80,605 97,220
Office Expense 43,100 38,532 53,975
Professional Services 705,400 481,977 677,200
Training 51,050 29,981 46,725
Travel & Conferences 44,950 23,955 52,350
Uncollectible Accounts 50,500 38,000 38,000
Utilities 123,000 107,603 123,200
Vehicle Equipment 314,150 324,168 350,450
Supplies & Services Sub-Total 31996.585 3.311.775 3,713.822
Total Operating Expenses 29,306,38 25,760.168 30,399.622
Expenses (Non-Operating):
Interest on Long Term Debt 1,940,954 1,940,954 1,906,426
Job Closing Expense - 30,000
Other Expense 103.193 65.06 93,193
Total Non-Operating Expenses 2,044,147 2.006.014 2.029.619
Total Expenses 31.350.527 27.766.182 32.429.241
!2.245.9401 1872.7791 !1.368.5481
Income (Loss)
Principle on Long Term Debt (855,000) (855,000) (890,000)
Vehicle & Capital Equipment (334,550) (334,550) (774,850)
L
Yorba Linda Water District **REVISED**
Water Enterprise
(Prior Year Budget, Forecast & Current Year Budget)
• Budget Forecast Budget
FY 2010111 FY 2010111 FY 2011112
Revenue (Operating):
Water Revenue (Residential) $17,248,481 $14,437,084 $18,183,416
Water Revenue (Commercial & Fire Dot) 1,522,341 1,752,207 1,342,034
Water Revenue (Landscapolirrigation) 3,588,335 3,301,660 3,835,552
Service Charges 3,313,674 3,246,329 3,378,240
Other Operating Revenue 574.108 760.590 652, 773
Total Operating Revenue 26,246,939 23,497.870 27.392.015
Revenue (Non-Operating):
Interest 142,000 218,560 200,000
Property Taxes 1,200,000 1,200,000 1,232,000
Other Non-Operating Revenue 22668 620,065 498,329
Total Non-Operating Revenue 1,569,668 2,038,625 1,930,329
Total Revenue 27,816,607 25,536,495 29,322,344
Expenses (Operating):
Depreciation & Amortization 4,403,257 4,422,263 4,500,000
Variable Water Costs (G.W., Import & Power) 12,667,236 10,750,147 13,698,538
Salary Related Expenses 6,809,598 5,935,600 6,823,871
Supplies & Services:
Communications 376,576 241,210 295,972
Contractual Services 707,007 432,194 536,739
Data Processing 109,596 106,949 118,947
Dues & Memberships 30,778 29,932 33,398
. Fees & Permits 44,020 121,241 135,490
Board Election 72,800 32,400
Insurance 314,314 221,000 221,433
Materials 337,766 391,337 353,244
District Activities, Emp Recognition 11,648 12,059 15,810
Maintenance 325,227 409,132 368,603
Non-Capital Equipment 92,611 68,905 79,221
Office Expense 39,221 35,832 51,072
Professional Services 638,224 439,877 630,256
Training 45,735 26,581 44,080
Travel & Conferences 40,602 22,155 48,442
Uncollectible Accounts 45,955 34,600 35,340
Utilities 111,930 97,903 113,925
Vehicle Equipment 285,877 257,168 278,209
Supplies & Services Sub-Total 3,629,887 29,887 2,980,475 3,360,181
Total Operating Expenses 27,509,978 24,088.485 28,382 590
Expenses (Non-Operating):
Interest on Long Term Debt 1,940,954 11981,300 1,940,954
Job Closing Expense - - 25,000
Other Expense 102,193 57.193 92193
Total Non-Operating Expenses 2.043 147 Z038,4 93 2.058,147
Total Expenses 29,553,125 26,126,978 30,440,737
Income (Loss) !1.736.5981 4 3 !1.118.3931
Principle an Long Term Debt (855,000) (855,000) (890,000)
• Vehicle & Capital Equipment (244,550) (244,550) (254,850)
L
Yorba Linda Water District **REVISED**
Sewer Enterprise
(Prior Year Budget, Forecast & Current Year Budget)
• Budget Forecast Budget
FY 2010/11 FY 2010111 FY 2011112
Revenue (Operating):
Sewer Charge Revenue 1,112,574 1,205,500 1,586,566
Locke Ranch Assessments 102,828 102,828 102,828
Other Operating Revenue 33.132 13.000 13,132
Total Operating Revenue 1,248.534 1,321,328 1,702,528
Revenue (Non-Operating):
Interest 14,000 21,695 20,000
Other Non-Operating Revenue 25,446 13.885 15, 823
Total Non-Operating Revenue 39,446 35,580 35.823
Total Revenue 1,287,980 1,356,908 1.738.349
Expenses (Operating):
Depreciation & Amortization 587,728 606,779 609,837
Salary Related Expenses 817,765 733,604 1,053,554
Supplies & Services:
Communications 39,284 22,600 24,278
Contractual Services 85,778 61,000 40,681
Data Processing 10,839 5,700 8,953
Dues & Memberships 3,340 3,300 2,739
Fees & Permits 6,382 6,400 13,390
Board Election 7,200 3,200 -
Insurance 31,086 21,100 16,667
. Materials 18,849 19,600 25,101
District Activities, Emp Recognition 1,152 1,400 1,190
Maintenance 101,973 45,200 60,067
Non-Capital Equipment 20,509 11,700 17,999
Office Expense 3,879 2,700 2,903
Professional Services 66,906 42,100 46,944
Training 5,314 3,400 4,645
Travel & Conferences 4,348 1,800 3,908
Uncollectible Accounts 4,545 3,400 2,660
Utilities 11,070 9,700 9,275
Vehicle Equipment 28,273 6000 72.241
Supplies & Services Sub-Total 450.727 331.300 353,641
Total Operating Expenses 1,856.22Q 1,671,683 2,017,032
Expenses (Non-Operating):
Job Closing Expense - - 5,000
Other Expense 1.000 7,867 1.000
Total Non-Operating Expenses 11000 7.867 6.000
Total Expenses 1,857J 220 1,679,550 2.023.032
Income (Loss) (569.2401 1322.6421 (284.683}
Vehicle & Capital Equipment (24.0 001 21 4,000) (520000)
•
L
ITEM NO. 3.2
AGENDA REPORT
Meeting Date: April 11, 2011 Budgeted: N/A
To: Finance-Accounting Committee
From: Ken Vecchiarelli, General
Manager
Presented By: Stephen Parker, Finance Dept: Finance
Director
Reviewed by Legal: N/A
Prepared By: Stephen Parker, Finance
Director
Subject: FY 2011/12 Budget Calendar Update
DISCUSSION:
Attached is the FY 2011/12 Budget Calendar with changes that have occurred since it was last
presented shown in red.
PRIOR RELEVANT BOARD ACTION(S):
At the February 7, 2011 Finance-Accounting Committee meeting, staff presented and discussed a
budget calendar for planning and identifying milestone objectives.
ATTACHMENTS:
Narne: Description: V Ype:
Budget Calendar- FY 11.12 4.11.11.xls FY 11/12 Budget Calendar 4.11.11 Backup Material
BUDGET CALENDAR FOR FISCAL YEAR 2011/12
DATE BOARD/COMMITTEE SCHEDULE
FEBRUARY
February 1, 2011 Manager's Meeting Discuss Budget Calendar and Process
February 7, 2011 Finance-Accounting Committee Approval of the Budget Calendar
February 10, 2011 Manager's Meeting Personnel & Capital budget discussion
MARCH
March 15, 2011 Manager's Meeting Department budgets complete (v 1.0) and submitted to the Finance Dept.
March 25, 2011 Board Workshop - Budget Discussion, guidance, goals and objectives
APRIL
n r: n 291
~p~~T P-h1mr- Information Tenhnningy Committee
Public Affairs-Communications-Technology
April 11, 2011 Committee IT & Public Information budget (v 1.0)
April 14 Planning-Engineering-Operations Committee Capital improvement & replacement projects budget (v 1.0)
April 12, 2011 Engineering and Operations budget (v 1.0)
April 11, 2011 Finance-Accounting Committee Finance budget (v 1.0), Reserve policy analysis (v 1.0)
Revenues (v 1.0), Preliminary budget overview (v 1.0)
April 12, 2011 Personnel-Risk Mgmt Committee Labor and benefits (v 1.0), HR budget (v 1.0)
April 19, 2011 Exec-Admin-Organizational Committee Board of Directors and Administration budget (v 1.0)
n n 4424-20-1 nr- p rvn ~r ~.~=r P-r°i . „ + dget ^ ry & ' 1)
1296sible Prop
April 26, 2011 Manager's Meeting Department budgets (v 2.0) (if needed)
MAY
May 2, 2011 P !Rf Matig^^_TeGhROIGgy r ++a
Public Affairs-Communications-Technology
Committee IT & Public Information budget (v 2.0) (if needed)
May 5, 2011 Planning-Engineering-Operations Committee Capital improvement & replacement projects budget (v 2.0)
Engineering and Operations budget (v 2.0) (if needed)
May 9, 2011 Finance-Accounting Committee Draft budget overview, Draft reserve policy
May 10, 2011 Personnel-Risk Mgmt Committee Labor and benefits (v 2.0) (if needed)
May 12, 2011 Board of Directors Draft budget overview, Draft reserve policy
Ma.,ga 24, te- ~~~,n + 'n 9r~ a, r~ w„-m.„«^ ++oe $6ard a+n ro ~ ~ Administration budget (v 2.0) (of needed)
May 26, 2011 Board of Directors Draft Budget (Full Board)
JUNE
* June 6, 2011 Finance-Accounting Committee Budget adjustments as needed
June 9, 2011 Board of Directors Budget adoption (full board), Reserve policy
June 23, 2011 Board of Directors Budget adoption (full board) & rate hearing (if needed)
* June 28, 2011 Board of Directors Prop 218 Public Hearing (if needed)
* Tenative date
ITEM NO. 3.3
AGENDA REPORT
Meeting Date: April 11, 2011
Total Budget: $455,535
To: Finance-Accounting Committee
From: Ken Vecchiarelli, General
Manager
Presented By: Stephen Parker, Finance Dept: Finance
Director
Reviewed by Legal: N/A
Prepared By: Stephen Parker, Finance
Director
Subject: Draft Finance Department Budget
DISCUSSION:
The Finance Department has decreased it's budget by 10.5% down to $455,535. The most
significant cuts this year were made in consulting under professional services and temporary labor
under contract services.
60% of the Finance Department's budget relates to Customer Service, with postage and printing of
customer bills, credit card and lockbox fees, phone answering service and writing off uncollectible
accounts amount to 95% of Customer Service's budget. In the Administration Section, the Cost of
Service and Water Rate Study, the expense for external auditors and consulting services for items
like our accounting software and bond counsel, account for over 90% of the budget. In the
Accounting Section, our bank service fees and office supplies for the administrative building
account for over 75% of the budget. Lastly, in the Meter Services Section, over 70% of the $20,900
Supplies and Services budget is made up of buffer inventory covering warranty returns for register
replacements and MXU's (components of our meters that may fail).
ATTACHMENTS:
Name: Description: Type:
Finance Summary.xlsx Finance Budget Summary Backup Material
3010-Fin Admin.pdf 3010 - Budget Detail Backup Material
3020-Accounting.pdf 3020 - Budget Detail Backup Material
3030-CS Billing.pdf 3030 - Budget Detail Backup Material
3040-Meter Reading. df 3040 - Budget Detail Backup Material
FINANCE
FY 2010/11 FY 2010/11 FY 2011/12
Budget Forecast Budget
Expenses (Operating)
Supplies & Services
Communications $ 101,050 $ 100,521 $ 103,000
Contractual Services* $ 105,435 $ 132,913 $ 83,890
Dues & Memberships $ 1,900 $ 1,460 $ 1,695
Fees & Permits $ 76,630 $ 72,940 $ 86,130
Materials $ 18,540 $ 19,624 $ 15,320
Maintenance $ 350 $ - $ 200
Non-Capital Equipment $ 2,950 $ 1,400 $ 2,200
Office Expense* $ 24,400 $ 17,327 $ 22,000
Professional Services $ 113,900 $ 68,877 $ 92,000
Training $ 5,200 $ 3,339 $ 4,100
Travel & Conferences $ 7,850 $ 3,208 $ 7,000
Uncollectible Accounts $ 50,500 $ 38,000 $ 38,000
Vehicle Expenses $ 200 $ - $ -
Supplies & Services Sub-Total $ 508,905 $ 459,609 $ 455,535
Figures have been adjusted to reflect changes in the District's account structure.
Section Detail Expense Budget
Dept/Section: Fin (Admin) (3010) FY 2012
1-3010-0600-00 $575 1-3010-0600-00 575 Check signature plate 375
CONTRACTUAL SERVICES (E) CONTRACTUAL SERVICES (E) Misc. contracts 200
1-3010-0640-00 $915 1-3010-0640-00 915 CSMFO 110
DUES,MEMBERSHIPS,SUBSCRI DUES,MEMBERSHIPS,SUBSCRIPTI
PTIONS (E) ONS (E) CMTA 185
AICPA 270
CPA License Renewal 200
GFOA 150
1-3010-0760-00 $500 1-3010-0760-30 500 Reference Books 500
OFFICE EXPENSE (E) Books & Publications
1-3010-0780-00 $90,000 1-3010-0780-00 90,000 Project consulting 15,000
PROFESSIONAL SERVICES (E) PROFESSIONAL SERVICES (E) Cost of Service and Water Rate Study 35,000
Auditors 25,000
Bond counsel 5,000
Fieldman Rolapp 5,000
Great Plains consulting 5,000
1-3010-0810-00 $1,200 1-3010-0810-00 1,200 CSMFO Webinars/Luncheons 500
Training Training
GASB Updates 200
Misc Training 500
1-3010-0830-00 $4,500 1-3010-0830-00 4,500 CSMFO Conference 500
TRAVEL & CONFERENCES (E) TRAVEL & CONFERENCES (E) GFOA Conference 2,000
CMTA Conference 1,000
ACWA Conference 1,000
Section Total $97,690
Section Detail Expense Budget
Dept/Section: Fin (Accounting) FY 2012
(3020)
escription
1-3020-0580-00 $400 1-3020-0580-00 400 Publish Unclaimed List 400
COMMUNICATIONS (E) COMMUNICATIONS (E)
1-3020-0600-00 $10,815 1-3020-0600-00 265 FSA Plan FLex Advantage 165
CONTRACTUAL SERVICES (E) CONTRACTUAL SERVICES (E) Misc 100
1-3020-0600-30 550 Check signer 550
Warranties & Service Contracts
1-3020-0600-70 10,000 Accounting 10,000
Temporary Employment Services
1-3020-0645-00 $30,130 1-3020-0645-50 30,130 Analysis Fees (avg $2550/mo) 30,000
Fees & Permits Bank Service/Fees
Safe Deposit Box Fee 100
Annual Bankcard Fee 30
1-3020-0640-00 $600 1-3020-0640-00 600 Joann - CSMFO, GFOA, etc 300
DUES,MEMBERSHIPS,SUBSCRI DUES,MEMBERSHIPS,SUBSCRIPTI
Delia Lugo - CSMFO, GFOA, etc. 300
PTIONS (E) ONS (E)
1-3020-0730-00 $200 1-3020-0730-00 200 Misc (typewriter, etc.) 200
MAINTENANCE (E) MAINTENANCE (E)
1-3020-0750-00 $500 1-3020-0750-00 500 Mlsc. Small Equipment (Ergonomic, etc.) 500
NON-CAPITAL EQUIPMENT (E) NON-CAPITAL EQUIPMENT (E)
1-3020-0760-00 $19,350 1-3020-0760-00 14,000 Office supplies 12,500
OFFICE EXPENSE (E) OFFICE EXPENSE (E) AP & Payroll check stock 1,200
Ribbon (Check signing machine) 300
1-3020-0760-10 4,800 Paper 4,800
Paper
1-3020-0760-30 250 GP Dynamics Publications 250
Books & Publications
1-3020-0760-50 300 Meeting Supplies 300
Meeting Supplies
1-3020-0810-00 $1,300 1-3020-0810-00 1,300 Staff Training 400
Training Training
GP Dynamics -Smartlist Builder 400
Payroll related training 500
1-3020-0830-00 $700 1-3020-0830-00 700 Misc. Travel & Conference 500
TRAVEL & CONFERENCES (E) TRAVEL & CONFERENCES (E) Mileage 200
Section Total $63,995 1 i i I
Section Detail Expense Budget
Dept/Section: Fin (CS & Billing) FY 2012
(3030)
;rn Description
& L_ J
1-3030-0580-00 $102,600 1-3030-0580-00 600 UPS/ Fed Ex/Other 600
COMMUNICATIONS (E) COMMUNICATIONS (E)
1-3030-0580-10 7,000 Postage Metered 7,000
Postage
1-3030-0580-22 95,000 Postage - Infosend 95,000
Postage - Infosend
1-3030-0600-00 $70,000 1-3030-0600-00 1,500 Post Office Box 180
CONTRACTUAL SERVICES (E) CONTRACTUAL SERVICES (E) Post Master - Lockbox 1,320
1-3030-0600-22 55,000 Mailing Service 42,000
Printing of Bills - Infosend
Info Send E-Bill Fees 13,000
1-3030-0600-30 500 Meter & Scale Maint. Contract 500
Warranties & Service Contracts
1-3030-0600-55 8,000 Phone Answering Service 8,000
Answering Service
1-3030-0600-70 5,000 Temporary Employment 5,000
Temporary Employment Services
1-3030-0645-00 $56,000 1-3030-0645-50 56,000 Credit Card & Auto Dr Processing 29,000
Fees & Permits Bank Services/Fees
Lock Box Services 27,000
1-3030-0750-00 $500 1-3030-0750-00 500 Miscellaneous Equipment 500
NON-CAPITAL EQUIPMENT (E) NON-CAPITAL EQUIPMENT (E)
1-3030-0760-00 $2,150 1-3030-0760-00 1,750 Postage Machine Supplies 300
OFFICE EXPENSE (E) OFFICE EXPENSE (E) Deposit Supplies 100
Forms/Pads/Tags 1,350
1-3030-0760-30 250 Customer Service Publications/Books 250
---Books & Publications
1-3030-0760-50 150 Meeting Supplies 150
Meeting Supplies
1-3030-0780-00 $2,000 1-3030-0780-09 2,000 Agency Fee 2,000
PROFESSIONAL SERVICES (E) Collection Services
1-3030-0810-00 $1,600 1-3030-0810-00 1,600 Cust Serv Clerks Seminar 1,000
Training Training
Supervisor Training 600
1-3030-0830-00 $100 1-3030-0830-00 100 Mileage 100
TRAVEL & CONFERENCES (E) TRAVEL & CONFERENCES (E)
1-3030-0850-00 $38,000 1-3030-0850-00 38,000 38,000
UNCOLLECTIBLE ACCOUNTS (E) UNCOLLECTIBLE ACCOUNTS (E)
I Section Total $272,950
Section Detail Expense Budget
Dept/Section: Fin (Meter Reading) FY 2012
(3040)
1-3040-0600-00 $2,500 1-3040-0600-30 1,500 Sensus Maintenance and Support 1,500
CONTRACTUAL SERVICES (E) Maintenance contracts
1-3040-0600-50 1,000 Uniforms 1,000
Uniform
1-3040-0640-00 $180 1-3040-0640-00 180 AWWA 180
DUES,MEMBERSHIPS,SUBSCRI DUES,MEMBERSHIPS,SUBSCRIPTI
PTIONS (E) ONS (E)
1-3040-0710-00 $15,320 1-3040-0710-00 15,320 Register Replacements (Buffer Inventory for Warran 6,720
MATERIALS (E) MATERIALS (E) MXU (Buffer Inventory for Warranty Returns) 8,200
PPE Equipment (Rain Gear) 400
1-3040-0750-00 $1,200 1-3040-0750-00 500 Meter Shop Equipment 500
NON-CAPITAL EQUIPMENT (E) NON-CAPITAL EQUIPMENT (E)
1-3040-0750-10 700 Hand Tools/Meter Lid Bars/Lifters 500
Hand and Power Tools
Power Tools 200
1-3040-0830-00 $1,700 1-3040-0830-00 1,700 Lodging 700
TRAVEL & CONFERENCES (E) TRAVEL & CONFERENCES (E) Travel 800
Meals 200
Section Total $20,900
ITEM NO. 3.4
AGENDA REPORT
Meeting Date: April 11, 2011
To: Finance-Accounting Committee
From: Ken Vecchiarelli, General
Manager
Presented By: Stephen Parker, Finance Dept: Finance
Director
Reviewed by Legal: N/A
Prepared By: Stephen Parker, Finance
Director
Subject: Investment Policy Annual Review
DISCUSSION:
The California Government Code says that the treasurer or chief fiscal officer of a local agency may
annually render to the legislative body of that local agency and any oversight committee of that local
agency, a statement of investment policy, which should be considered at a public meeting. As such,
the District's current investment policy, as established in Resolution No. 10-03, on March 11, 2010
is attached. After a review of the current investment policy by the Finance Department, it has been
determined that no changes are needed at this time.
ATTACHMENTS:
Name: Dosciiption: a ype:
Resolution No. 10-03 - Investment Policy.pdf Investment Policy Backup Material
RESOLUTION 10-03
RESOLUTION OF THE BOARD OF DIRECTORS
OF THE YORBA LINDA WATER DISTRICT
SETTING FORTH PUBLIC FUNDS INVESTMENT POLICY
AND RESCINDING RESOLUTION NO. 09-01
WHEREAS, California Government Code (CGC) Section 53600, et seq. sets forth
guidelines for the investment of public funds and
WHEREAS, the current District's Investment Policy was adopted by Resolution No. 09-
01 on January 22, 2009; and
WHEREAS, the District is in possession of public funds that are not required for
immediate expenditure, and are available for investment; and
WHEREAS, a policy setting forth guidelines for the investment of said funds is
necessary for compliance with the principles of sound financial
management; and
WHEREAS, the Board of Directors of the Yorba Linda Water District desire to adopt
the Investment Policy set forth herein.
NOW, THEREFORE, BE IT RESOLVED by Board of Directors of the Yorba Linda
Water District as follows:
Section 1: Public funds held for investment by the District may be categorized as
follows:
a) Those funds that are allocated for immediate expenditure on
District operations as authorized by the Board of Directors at their
bimonthly meetings;
b) Those funds that are allocated for use in an intermediate time
frame, such as budgeted purchases, that have not been delivered;
c) Those funds that are allocated for future use which do not fall into
the above categories. This policy sets forth guidelines for funds
that are identified as "available for investment."
Section 2: Delegated representative and standards and procedures for the operation
of the investment program as follows:
a) The authority of the Board of Directors to invest funds is derived
from Section 53607 of the CGC The responsibility to invest,
reinvest, sell or exchange securities is hereby delegated to the
General Manager or Finance Director for a period of one year The
Resolution No 10-03 Setting Forth Public Funds Investment Policy and Rescinding Resolution No. 09-01 1
Board of Directors may renew the delegation of authority pursuant
to state law each year.
b) The standard of prudence to be used by the designated
representative shall be the "prudent investor" standard and shall be
applied in the contest of managing the overall portfolio. The
meaning of the standard of prudent investor, means investment,
reinvestment, purchasing, acquiring, exchanging, selling or
managing public funds shall be made with care, skill, prudence and
diligence, under circumstances then prevailing, including but not
limited to, the general economic conditions and the anticipated
needs of the agency, which a prudent person, acting in a like
capacity and familiarity with those matters would use in the conduct
of funds of a like character and with like aims, to safeguard the
principal and maintain the liquidity needs of the District.
Section 3: The General Manager or his/her designated representative shall maintain
a cash flow analysis for projecting cash available for investments. All
funds not required for immediate or intermediate use may be invested in
accordance with this policy The total funds invested at any time pursuant
to this policy will constitute the District's "investment portfolio"
Section 4: Priorities regarding the investment of District held public funds are:
a) The safety of funds. Safety of principal is the foremost objective of
the investment portfolio Investments shall be undertaken in a
manner that seeks to ensure the preservation of capital in the
overall portfolio
b) The maintenance of sufficient liquidity to meet all operating
requirements that may be reasonably anticipated. Securities
should mature concurrent with cash needs to meet anticipated
demands.
c) The investment portfolio shall be designed with the objective of
attaining the best yield or returns on investments, taking into
account the investment risk constraints and liquidity needs. Return
on investment is of secondary importance compared to the safety
and liquidity objectives.
Section 5: The District may invest funds that are available for direct investment in the
following categories:
a) Banks or Savings and Loans
Resolution No. 10-03 Setting Forth Public Funds Investment Policy and Rescinding Resolution No. 09-01 2
Cash will be deposited only in Federal Deposit Insurance
Corporation or Federal Savings and Loan Insurance Corporation
(FSLIC) insured institutions or fully collateralized certificates of
deposit. Collateral for a given investment must be 110 percent of
principal for government securities collateral and 150 percent of
principal for first mortgage collateral. The institution must maintain
a net worth to asset ratio of at least 3 0 percent, and a positive
earnings record. The bank or savings and loan must be located in
California. The maximum maturity shall be five years. No limit will
be place on the percentage total invested in this category
b) The State Local Agency Investment Fund (LAIF).
The amounts deposited in this category are limited to $10 million
plus bond proceeds. No limit will be placed on the percentage total
in this category.
c) Orange County Treasurer's Commingled Investment Pool -
Government Code Section 53684
The amounts deposited in this category are limited to $10 million
plus bond proceeds. No limit will be placed on the percentage total
in this category
d) California Asset Management Program
The amounts deposited in this category shall be limited to bond
proceeds and are to be invested for the purpose of arbitrage
management only Proceeds may be invested in the Treasury
Portfolio and/or the Money Market Portfolio. No limit will be placed
on the percentage total in this category
e) Treasury Bills, Notes and Bonds - Government Code Section
53601(b-d)
The District will require physical delivery of these securities to an
acceptable safekeeping account in the District's name and must be
properly insured. The maximum maturity shall be limited to five
years. No limit will be placed on the percentage total invested in
this category
f) Obligations Issued by Federal Agencies and U S, Government
Sponsored Enterprises - Government Code Section 53601 (f)
Resolution No. 10-03 Setting Forth Public Funds Investment Policy and Rescinding Resolution No. 09-01 3
The District will require physical delivery of these securities to an
acceptable safekeeping account in the District's name and must be
properly insured. Examples of these securities include Federal
National Mortgage Association, Federal Land Bank and Federal
Home Loan Bank. The maximum maturity shall be limited to five
years and the maximum investment of 50 percent of the investment
portfolio in the aggregate.
g) Corporate Bond - Government Code Section 53601(k)
The District will require electronic delivery of these securities to an
acceptable safekeeping account in the District's name, which must
be properly insured. The corporation must be domestic, the notes
must be domestic and the notes must be issued in the United
States. The corporation must be domestic and the notes must be
domestic and the notes must be issued in the United States. The
corporation must be rated A or its equivalent or better by a
nationally recognized rating service. The maximum maturity is
limited to five years and the maximum percentage allowable for
investment is 30 percent of the investment portfolio in the
aggregate.
h) Banker's Acceptance - Government Code Section 53601(g)
The District will require physical delivery of these securities to an
acceptable safekeeping account in the District's name and must be
properly insured. The maximum term may not exceed 180 days
and the maximum percentage allowable for investment is 10
percent of the portfolio in the aggregate.
i) Commercial Paper - Government Code Section 53601(h)
The District will require physical delivery of these securities to an
acceptable safekeeping account in the District's name and must be
properly insured. Commercial paper rated the highest ranking or of
the highest letter and number ratings as provided for by a nationally
recognized statistical-rating organization. The entity that issues the
commercial paper shall meet two sets of criteria: (1) The
corporation shall be organized and operating within the United
States, shall have total assets in excess of five hundred million
dollars ($500,000,000), and shall issue debt, other than commercial
paper, if any, that is rated A or higher by a nationally recognized
statistical-rating organization. (2) The corporation shall be
organized within the United States as a special purpose
corporation, trust, or limited liability company, has program wide
credit enhancements including, but not limited to, over
Resolution No. 14-03 setting Forth Public Funds Investment Policy and Rescinding Resolution No. 09-01 4
collateral ization, letters of credit, or surety bond; has commercial
paper that is rated "a-1" or higher, or equivalent by a nationally
recognized statistical-rating organization. Eligible commercial
paper may not exceed 270 days' maturity and may not represent
more than the 25 percent of the investment portfolio in the
aggregate-
Investment Trust of California (the CalTRUST JPA pool) -
Government Code Section 53601(p)
The amounts deposited in this category are limited to $10 million
plus bond proceeds. No limit will be placed on the percentage total
in this category
k) Money Market Funds
Shares of a qualified money market fund, as defined in CGC
section 53601, must meet the criteria described therein.
Section 6: All investments of sums of less than $100,000 do not require approval of
the Board of Directors or need to be collateralized. Such investments,
however, must be made in saving institutions covered by federal deposit
insurance.
Section 7: Investment of sums greater than $100,000 and less than $1,000,000 in a
single institution is authorized in institutions that comply with the following
parameters:
a) Collateral requirements as set forth in Section 5, (a) herein;
b) Institution established as a business in California for a minimum of
three years;
c) Must show a profit for the most recent two consecutive years;
d) A capital ratio of six percent for banks, and five percent for savings
& loans;
e) No more than three percent foreclosures;
f) Financial rating of "excellent" or "superior"
Section 8: All investments greater than $1,000,000 in one institution, with exception
of LAIF, Investment Trust of California (the CalTRUST JPA pool) and
Orange County Treasurer's Commingled Investment Pool (OCIP), require
approval of the Board of Directors.
Resolution No. 10-03 Setting Forth Public Funds Investment Policy and Rescinding Resolution No. 09-01 g
Section 9: When the District uses the services of a broker/dealer to purchase
securities, they shall be selected for credit worthiness. These may include
"primary" dealers or regional dealers. Each security purchased through a
broker/dealer shall be registered in the name of Yorba Linda Water
District. No deposit of cash and/or securities shall be made by the
broker/dealer except in a qualified public depository as established by
state law and Section 3(1) of this resolution. Before a broker/dealer is
used, they are subject to investigation and approval by the General
Manager or the designated representative and must submit the following:
a) Certification of having read and understood this investment policy
resolution and agreeing to comply with the District's investment
policy;
b) Proof of National Association of Security Dealers certification and
state registration;
c) Compliance with federal capital adequacy regulations and provide
documentation of financial solvency;
d) Provide audited financial statements within 120 days of fiscal year
end;
e) Provide similar services to other public-sector clients.
Section 10: Policy on repurchase and reverse repurchase agreements and derivative
products:
a) The District staff is not authorized to initiate investments in
repurchase or reverse repurchase agreements or "plain vanilla
OTC" and/or "more complex over the counter (OTC) derivative
products," as defined below, however, staff is authorized to deposit
in LAIF provided LAIF invests no more than ten percent of their
total portfolio in repurchase or reverse repurchase agreements and
does not use derivative products defined below
b) A "plain vanilla OTC" derivative product is defined by the U S.
General Accounting Office as a financial instrument whose market
value is derived from a reference rate, index, or a value of an
underlying asset. OTC derivatives are privately negotiated
contracts and are not traded on organized exchanges.
c) A "more complex OTC" derivative product is defined by the U S
General Accounting Office to have at least one of the following
characteristics:
Resolution No. 10-03 Setting Forth Public Funds Investment Policy and Rescinding Resolution No. 09-01 6
1 Their prices tend to be difficult to obtain, because they are
often available from only a few dealers;
2. The payments required by the derivative are calculated on
the basis of more than one interest, rate, currency, asset or
other factor;
3 The derivative contract has terms that are not determined
until some future Date;
4 The contract involves a term that acts as a multiplier or
increases the leverage of the rate(s) used to compute
payments;
5. The contract may entail potentially unlimited risk;
Section 11: The General Manager or his designated representative shall submit a
monthly investment portfolio report through the Finance-Accounting
Committee to the Board of Directors. Additionally, the General Manager
or his designated representative shall submit a comprehensive report for
Board approval each quarter. This report shall include but not be limited
to:
a) A list of the previous month's investments,
b) Institutions where investments were placed;
c) Dates of transactions;
d) Dates of maturity;
e) Interest rates on said investments;
f) Investment categories' percent of total portfolio.
Section 12: Ethics and Conflicts of Interest
All officials, staff members and consultants who make or participate in
making investment decisions on behalf of the District, will refrain from
personal business activity that could conflict with the execution of the
investment function or which may impair the ability to make impartial
investment decisions. Officials, staff members, and consultants will
disclose to the General Manager any financial interests with a financial
institution, provider, dealer or broker conducting business with the District.
Officials, staff members and consultants will further disclose any personal
Resolution No. 10-03 Setting Forth Public Funds Investment Policy and Rescinding Resolution No. 09-01 7
financial positions that could be related to the performance of the District's
portfolios;
Section 13: Safekeeping and Custody
All cash and securities in the District's Investment portfolio, including those
that are being managed by the delegated representative shall be held in
the District's name by a third party bank trust department, acting as agent
for the District under the terms of a custody agreement executed by the
bank and the District.
All securities will be received and delivered using delivery-versus payment
procedures. The District's safekeeping agent will only release payment for
a security after the security has been properly delivered. The only
exception to the foregoing shall be depository accounts and securities
purchases made with (i) local government investment pools, and (ii)
money market mutual funds, since the purchased securities are not
deliverable.
Section 14: Maximum Securities
To the extent possible, the District will attempt to match investments with
anticipated cash flow requirements. Pursuant to state law, no investment
shall have a maturity in excess of five years.
That Resolution No. 09-01 is hereby rescinded immediately upon adoption of this
Resolution.
PASSED AND ADOPTED this 11th day of March, 2010 by the following called vote:
AYES- Directors Beverage, Collett, Hawkins, Mills and Summerfield
NOES: None
ABSTAIN: None
ABSENT None
AOL
William R. Mills, President
Yorba Linda Water District
Resolution No. 10-03 Setting Forth Public Funds Investment Policy and Rescinding Resolution No. 09-01 8
ATTEST
v
Ken Vecchiarelli, Secretary
Yorba Linda Water District
Reviewed as to form by General Counsel:
rthur . Kidman, sq.
McCormick, Kidman & Behrens
Resolution No. 10-03 Setting Forth Public Funds Investment Policy and Rescinding Resolution No 09-01 9
ITEM NO. 3.5
AGENDA REPORT
Meeting Date: April 11, 2011 Budgeted: N/A
To: Finance-Accounting Committee
From: Ken Vecchiarelli, General
Manager
Presented By: Stephen Parker, Finance Dept: Finance
Director
Reviewed by Legal: N/A
Prepared By: Stephen Parker, Finance
Director
Subject: Annual Reserve Policy Review
SUMMARY:
Attached is a draft reserve policy update for the 2011/12 budget year. Some changes have been
made, but the total dollar amount of requested reserves remains the same as the prior year.
DISCUSSION:
When the financial reserves policy was adopted last May, staff indicated that it would be reviewed
annually to determine if updates were needed. This is the first draft of staff's proposed changes to
the reserve policy for review of the Finance-Accounting Committee. Next meeting, as we get closer
to the end of the year, staff will present numbers along with the proposed language changes for the
various sections of the reserve policy. Currently, just the suggested changes to the language are
being presented.
Staff recommends a number of minor proposed changes to the reserve policy. The primary change
is adding a new reserve, titled Maintenance Reserve. The funding for this would come out of the
total funding for the Capital Replacement Reserve, but the Maintenance Reserve would exist for
non-scheduled capital asset repair and replacement. Through the current fiscal year, staff had
budgeted approximately $285,000 annually for contingencies for wells, pipeline and pump repairs.
By establishing a reserve, rather than funding these contingencies in the Supplies and Services
section of the budget, we can lower the operating budget, while still having a source to pay for
unexpected maintenance repairs or replacements that are not necessarily emergencies but have an
impact on our operating expenses and service reliability if not taken care of.
Other changes include moving Employee Liabilities Reserve to a Board Designated Reserve, as it
was incorrectly classified as a Contractually Restricted Reserve, and minor revisions to language in
the Capital Replacement Reserve and Employee Liabilities Reserve.
PRIOR RELEVANT BOARD ACTION(S):
On May 27, 2010, the Board approved the establishment of Resolution 10-12 adopting and
implementing a financial reserves policy.
ATTACHMENTS:
!blame: Description: Type:
Draft Reserve Policy - 4.11.11.doc Draft 2011/12 Financial Reserve Policy Backup Material
RESERVE POLICY
A. GENERAL POLICY:
Maintaining adequate reserves is an essential part of sound financial management. The Yorba
Linda Water District Board of Directors realizes the importance of reserves in providing reliable
service to its customers, financing of long-term capital projects and funding availability for
emergencies should the need arise. Interest derived from reserve balances shall be credited to the
reserve account from which it was earned.
B. CATEGORIES:
YLWD shall accumulate, maintain and segregate its reserve funds into the following categories:
Restricted and Designated Reserves
1. Board Designated Reserves; and
2. Contractually Restricted Reserves.
C. SCOPE:
This policy will assist the Board of Directors in establishing:
1. Target levels for reserve funds;
2. Requirements for the use of reserve funds; and
3. Periodic review requirements for each reserve.
D. PERIODIC REVIEW:
Staff and the YLWD Board shall review the reserve balances and targets annually as a part of the
annual budget process. The Finance-Accounting Committee will continue to review all reserve
and investment balances monthly, with a quarterly report going to the full Board.
E. RESTRICTED AND DESIGNATED RESERVES:
1. Board Designated Reserves:
These are reserve funds earmarked for the purpose of funding such items as new capital
facilities, repair or replacement of existing facilities and general operating reserves designated
for a specific purpose and use by the Board of Directors.
1.0 Operating Reserve
A. Definition and Purpose - Established to cover temporary cash flow deficiencies that
occur as a result of timing differences between the receipt of operating revenue and
expenditure requirements and unexpected expenditures occurring as a result of doing
business.
April 11, 2011 Page 1 of 3
B. Target Level - The Governmental Accounting Standards Board (GASB) recommends
that funding should be one to two months (or 8% - 17%) of the District's annual
operating budget. The District's initial target will be a minimum of 5% and a
maximum of 8% of the annual operating budget for both the water and sewer funds.
C. Events or Conditions Prompting the Use of the Operating Reserve - This reserve may
be utilized as needed to pay outstanding operating expenditures prior to the receipt of
anticipated operating revenues.
1.1 Emergency Reserve
A. Definition and Purpose - Established to provide protection recovery to the District
and its customers for losses arising from an unplanned event or circumstance. The
reserve level combined with YLWD's existing insurance policies should adequately
protect YLWD and its customers in the event of a loss.
B. Target Level - Established at a minimum level equal to $1,000,000 for the water fund
and shall accumulate interest and annual contributions as determined by the District's
annual operation to a maximum level of $4,000,000. The target for sewer will be a
minimum of $250,000 and a maximum of $1,000,000.
C. Events or Conditions Prompting the Use of the Emergency Reserve - This reserve
shall be utilized to cover unexpected losses experienced by the District as a result of a
disaster or other unexpected loss. Any reimbursement received by the District from
insurance companies as a result of a submitted claim shall be deposited back into the
reserve as replenishment for the loss.
1.2 Capital Replacement Reserve
A. Definition and Purpose - Established to provide capital repair and replacement
funding as the District's infrastructure deteriorates over its expected useful life.
B. Target Level - The Board-approved 2010 Asset Management Plan recommended that
the annual contribution to this reserve be at a minimum level of $1,820,000 for the
water fund and $345,000 for the sewer fund, less money set aside for the Maintenance
Reserve. Funding with available funds based on the District's operations shall be
allocated quarterly.
C. Events or Conditions Prompting the Use of the Capital Replacement Reserve -
Through the annual budget process, staff shall recommend anticipated asset
replacement projects. The Board of Directors shall take action to approve
recommended project appropriations from the capital replacement reserve. Should
unplanned replacement be necessary during any fiscal year, the Board of Directors
may take action to amend the budget and appropriate needed funds as required.
1.3 Maintenance Reserve
A. Definition and Purpose - Established to provide funding for non-scheduled capital
asset repair and replacement.
April 11, 2011 Page 2 of 3
B. Target Level - $200,000 annually subject to annual review.
C. Events or Conditions Prompting the Use of the Maintenance Replacement Reserve -
Unplanned failure of assets including but not limited to pumps, motors and major
facilty repairs.
1.4 Employee Liabilities Reserve
A. Definition and Purpose - The purpose is to cover employees' accrued vacation and
other compensatory time and to ensure the complete funding associated with the
liability incurred for employees whom have met the requirements necessary for
district paid health benefits at retirement.
B. Target Level - The annual contribution will begin at $100,000 ($91,000 for water and
$9,000 for sewer) to be evaluated and/or adjusted annually thereafter based on an
analysis of current employees' vacation and sick time accrued and actuarial
determinations of future retiree costs. The amount of actuarily-determined
contributions for the District's Other Post Employment Benefit (OPEB) costs that the
District has underfunded and is therefore shown as a long-term liability as of June 30,
2010 was $236,483. When combined with a liability on the District's books for
vacation, compensatory and sick time of $1,050,888 at June 30, 2010, the target is
projected to be approximately $1,300,000 for the combined water and sewer
enterprises.
C. Events or Conditions Prompting the Use of the Employee Liabilities Reserve - This
reserve may be used in the event that operating funds are not adequate to meet
vacation, compensatory and sick time paid out or retiree medical cost obligations
within the current year.
2. Contractually Restricted Reserves:
These are funds held to satisfy limitations set by external requirements established by creditors,
grant agencies or law. Examples include stipulated bond covenants and reserves held with a
fiscal agent.
2.0 US Bank 2008 COP Reserve
A. Definition and Purpose - Established to cover reserve requirements held with a
designated fiscal agent (US Bank) for the 2008 Certificates of Participation.
B. Target Level - Funding shall be held in an amount equal to $2,147,096.
C. Events or Conditions Prompting the Use of the Contractually Restricted Reserve -
This reserve may be utilized as needed by the fiscal agent to pay any outstanding debt
service payments not covered by the District within the specified billing and due
dates.
April 11, 2011 Page 3 of 3