HomeMy WebLinkAbout2012-02-27 - Finance-Accounting Committee Meeting Agenda Packet Yorba Linda
Water District
AGENDA
YORBA LINDA WATER DISTRICT
FINANCE-ACCOUNTING COMMITTEE MEETING
Monday, February 27, 2012, 4:00 PM
1717 E Miraloma Ave, Placentia CA 92870
COMMITTEE STAFF
Director Robert R. Kiley, Chair Ken Vecchiarelli, General Manager
Director Phil Hawkins Stephen Parker, Finance Manager
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. Unaudited Financial Statements for Period Ending December 31, 2011
Recommendation: That the Finance-Accounting Committee recommend the Board
of Directors receive and file the Unaudited Financial Statements for the Period
Ending December 31, 2011.
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. December 2011 Debt Service Ratio
3.2. Investment Report for Period Ending January 2012
3.3. January 2012 Budget to Actual Results
3.4. Draft Finance Department Budget
3.5. Preliminary 2013 Budget Numbers
3.6. FY 12/13 Budget Calendar Update
3.7. Upcoming Pension Accounting Changes
3.8. Status of Strategic Plan Initiatives
3.9. Future Agenda Items and Staff Tasks
4. ADJOURNMENT
4.1. The next meeting of the Finance-Accounting Committee will be held on March 26, 2012
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: February 27, 2012
To: Finance-Accounting Committee
From: Ken Vecchiarelli, General
Manager
Presented By: Stephen Parker, Finance Dept: Finance
Manager
Prepared By: Delia Lugo, Senior Accountant
Subject: Unaudited Financial Statements for Period Ending December 31 , 2011
SUMMARY:
Presented are the Unaudited Financial Statements for the Period Ending December 31 , 2011 for the
Water and Sewer Funds.
STAFF RECOMMENDATION:
That the Finance-Accounting Committee recommend the Board of Directors receive and file the
Unaudited Financial Statements for the Period Ending December 31 , 2011 .
DISCUSSION:
For the Period Ending December 31 , 2011 staff is presenting a consolidated unaudited statement in
a CAFR format. This new approach presents the quarterly statements on an accrual basis, and we
believe that this is a more complete and transparent presentation of the District's overall financial
position for your review.
Water Operating Revenue, as presented, is 50.9% of annual budget, which is lower than the
historical trend by 4% for the first half of the fiscal year. Other Operating Revenue is 64% of annual
budget. This is prominently due to the unbudgeted Vista Del Verde Project.Sewer Other Operating
Revenue is well over budget due to the Vista Del Verde Project for the first half of the fiscal year.
Sewer Other Non-Operating revenue is also well over budget, primarily to receiving $264,000 from
the City of Yorba Linda for the Sewer Transfer.
One noted item on the Sewer Fund Statement is Other Expense in the amount of $15,770. This
unbudgeted amount represents the refunds processed to our customers that were overcharged
sewer fees in previous years.
ATTACHMENTS:
Description: Type:
FY 2012 2nd Qtr Consolidated Balance Sheet.xlsx 2nd Quarter FY 2011/12 Unaudited Financial Statements Backup Material
FY 2012 2nd Qtr Combined Stmt.xls 2nd Quarter Consolidated Statement Backup Material
FY 2012 2nd Qtr Water Stmt.xlsx 2nd Quarter Water Statement Backup Material
FY 2012 2nd Qtr Sewer Stmt.xls 2nd Quarter Sewer Statement Backup Material
YORBA LINDA WATER DISTRICT
UNAUDITED COMBINING SCHEDULE OF NET ASSETS
December 31, 2011
(With June 30, 2011 for comparison only)
ASSETS December 2011 June 2011
CURRENT ASSETS:
Cash and cash equivalents 27,028,937 29,985,508
Investment 2,156,687 2,143,130
Accounts receivable-water and sewer services 2,819,987 3,642,530
Accounts receivable- property taxes 102,192 114,949
Accrued interest receivable 23,880 22,049
Prepaid expenses &other deposits 303,731 246,919
Inventory 239,289 233,613
TOTAL CURRENT ASSETS 32,674,703 36,388,698
NONCURRENT ASSETS:
Bond issuance costs 740,765 755,728
Other post-employment benefit(OPEB) asset 21,081 -
Capital assets:
Non-depreciable 10,164,560 5,223,388
Depreciable, net of accumulated depreciation 190,292,985 176,410,400
TOTAL NONCURRENT ASSETS 201,219,391 182,389,516
TOTAL ASSETS 233,894,094 218,778,214
LIABILITIES
CURRENT LIABILITIES:
Accounts payable 4,278,869 4,506,830
Accrued expenses 207,905 130,306
Accrued interest payable 474,418 483,171
Certificates of Participation - current portion 925,000 890,000
Compensated absences 259,177 251,798
Customer and construction deposits 255,201 281,156
Deferred revenue 419,959 416,525
TOTAL CURRENT LIABILITIES 6,820,529 6,959,786
LONG-TERM LIABILITIES (LESS CURRENT PORTION):
Deferred annexation revenue 14,230,314 14,406,176
Compensated absences 777,531 755,395
Other post-employment benefit(OPEB) liability - 122,065
Certificates of Participation 41,363,623 42,299,117
TOTAL LONG TERM LIABILITIES (LESS
CURRENT PORTION) 56,371,468 57,582,753
TOTAL LIABILITIES 63,191,997 64,542,539
NET ASSETS: $ 170,702,097 $ 154,235,675
YORBA LINDA WATER DISTRICT
UNAUDITED COMBINING SCHEDULE OF REVENUES, EXPENSES
AND CHANGES IN NET ASSETS
For the period ended December 31, 2011
(With fiscal year ended June 30, 2011 for comparison only)
December 2011 June 2011
OPERATING REVENUES:
Water sales 13,565,446 22,686,251
Sewer revenues 871,492 1,274,579
Other operating revenues 542,863 1,035,545
TOTAL OPERATING REVENUES 14,979,801 24,996,375
OPERATING EXPENSES
Variable water costs 7,183,755 11,268,306
Personnel services 3,611,485 6,902,995
Supplies and services 1,787,705 3,686,333
Depreciation and amortization 3,267,301 5,279,860
TOTAL OPERATING EXPENSES 15,850,246 27,137,494
OPERATING INCOME/(LOSS) (870,445) (2,141,119)
NONOPERATING REVENUES (EXPENSES):
Property taxes 677,509 1,258,769
Investment income 149,124 274,152
Interest expense (949,017) (1,172,503)
Other nonoperating revenues 484,018 739,062
Other nonoperating expenses (86,193) (406,575)
TOTAL NONOPERATING REVENUES/EXPENSES 275,441 692,905
NET INCOME/(LOSS) BEFORE CAPITAL
CONTRIBUTIONS (595,004) (1,448,214)
CAPITAL CONTRIBUTIONS 17,061,426 706,319
CHANGES IN NET ASSETS 16,466,422 (741,895)
NET ASSETS- BEGINNING OF YEAR 154,235,675 154,977,570
NET ASSETS- FOR PERIOD END DECEMBER 31, 2011 $ 170,702,097 $ 154,235,675
Yorba Linda Water District
Summary Financial Report
Water&Sewer Funds
For the Period Ending December 31, 2011
Original YTD YTD YTD
Budget Actual Under(Over) % of
FY 2012 FY 2012 Budget Budget
Revenue (Operating):
Water Revenue (Residential) $17,904,893 $8,581,043 $9,323,850 47.93%
Water Revenue (Commercial & Fire Det.) 1,726,651 1,003,387 723,264 58.11%
Water Revenue (Landscape/Irrigation) 3,757,058 2,298,176 1,458,882 61.17%
Water Revenue (Service Charge) 3,406,392 1,682,840 1,723,552 49.40%
Sewer Charge Revenue 1,548,550 762,736 785,814 49.25%
Locke Ranch Assessments 159,862 108,756 51,106 68.03%
Other Operating Revenue 754,361 542,863 211,498 71.96%
Total Operating Revenue: 29,257,767 14,979,801 14,277,966 51.20%
Revenue (Non-Operating):
Interest 190,000 149,124 40,876 78.49%
Property Tax 1,232,000 677,509 554,491 54.99%
Other Non-Operating Revenue 499,369 484,018 15,351 96.93%
Total Non-Operating Revenue: 1,921,369 1,310,651 610,718 68.21%
Total Revenue 31,179,136 16,290,452 14,888,684 52.25%
Expenses (Operating):
Variable Water Costs (G.W., Import& Power) 13,671,538 7,183,755 6,487,783 52.55%
Salary Related Expenses 7,941,306 3,611,485 4,329,821 45.48%
Supplies &Services 4,070,833 1,787,705 2,283,128 43.91%
Total Operating Expenses 25,683,677 12,582,945 13,100,732 48.99%
Expenses (Non-Operating):
Interest on Long Term Debt 1,906,426 949,017 957,409 49.78%
Other Expense 123,193 86,193 37,000 69.97%
Total Non-Operating Expenses: 2,029,619 1,035,210 994,409 51.01%
Total Expenses 27,713,296 13,618,155 14,095,141 49.14%
Net Income(Loss) Before Capital Contributions 3,465,840 2,672,297 793,543 77.10%
Contributed Capital - 17,061,426 17,061,426 0.00%
Net Income(Loss) Before Depreciation 3,465,840 19,733,723 17,854,969 569.38%
Depreciation &Amortization 5,561,699 3,267,301 2,294,398 58.75%
Total Net Income(Loss) ($2,095,859) $16,466,422 $15,560,571 -785.66%
Capital -Direct Labor - (197,500) (197,500)
Yorba Linda Water District
Water Fund
For the Period Ending December 31,2011
YTD YTD YTD
Budget Actual Under(Over) % of
FY 2012 FY 2012 Budget Budget
Revenue (Operating):
Water Revenue(Residential) $17,904,893 $8,581,043 $9,323,850 47.93%
Water Revenue(Commercial & Fire Det.) 1,726,651 1,003,387 723,264 58.11%
Water Revenue(Landscape/Irrigation) 3,757,058 2,298,176 1,458,882 61.17%
Water Revenue(Service Charge) 3,406,392 1,682,840 1,723,552 49.40%
Other Operating Revenue 697,360 445,857 251,503 63.93%
Total Operating Revenue: 27,492,354 14,011,303 13,481,051 50.96%
Revenue (Non-Operating):
Interest 170,000 137,221 32,779 80.72%
Property Tax 1,232,000 677,509 554,491 54.99%
Other Non-Operating Revenue 495,394 228,507 266,887 46.13%
Total Non-Operating Revenue: 1,897,394 1,043,237 854,157 54.98%
Total Revenue 29,389,748 15,054,540 14,335,208 51.22%
Expenses(Operating):
Variable Water Costs (G.W., Import& Power) 13,671,538 7,183,755 6,487,783 52.55%
Salary Related Expenses 6,953,531 3,141,844 3,811,687 47.80%
Supplies &Services:
Communications 369,303 104,560 264,743 28.31%
Contractual Services 527,888 201,441 326,447 38.16%
Data Processing 119,645 76,899 42,746 64.27%
Dues & Memberships 55,973 46,351 9,622 82.81%
Fees& Permits 140,030 73,063 66,967 52.18%
Insurance 221,526 93,164 128,362 42.06%
Materials 361,161 234,872 126,289 65.03%
District Activities, Emp Recognition 20,758 8,331 12,427 40.13%
Maintenance 418,603 232,177 186,426 55.46%
Non-Capital Equipment 79,221 28,460 50,761 35.92%
Office Expense 45,686 18,487 27,199 40.47%
Professional Services 794,406 303,501 490,905 38.20%
Training 49,964 21,744 28,220 43.52%
Travel &Conferences 48,221 11,916 36,305 24.71%
Uncollectible Accounts 35,340 432 34,908 1.22%
Utilities 114,855 37,831 77,024 32.94%
Vehicle Equipment 278,209 116,812 161,397 41.99%
Supplies&Services Sub-Total 3,680,788 1,610,041 2,070,747 43.74%
Total Operating Expenses 24,305,857 11,935,640 12,370,217 49.11%
Expenses(Non-Operating):
Interest on Long Term Debt 1,906,426 948,692 957,734 49.76%
Other Expense 117,193 70,423 46,770 60.09%
Total Non-Operating Expenses: 2,023,619 1,019,115 1,004,504 50.36%
Total Expenses 26,329,476 12,954,755 13,374,721 49.20%
Net Income(Loss) Before Capital Contributions 3,060,272 2,099,785 960,487 68.61%
Capital Contributions - 16,536 16,536 0.00%
Net Income(Loss) Before Depreciation 3,060,272 2,116,321 977,023 69.15%
Depreciation &Amortization 4,628,999 2,675,828 1,953,171 57.81%
Total Net Income(Loss) ($1,568,727) ($559,507) ($976,148) 35.67%
Capital- Direct Labor - (181,761) (181,761) -
Yorba Linda Water District
Sewer Fund
For the Period Ending December 31,2011
YTD YTD YTD
Budget Actual Under(Over) %of
FY 2012 FY 2012 Budget Budget
Revenue(Operating):
Sewer Charge Revenue $1,548,550 $762,736 $785,814 49.25%
Locke Ranch Assessments 159,862 108,756 51,106 68.03%
Other Operating Revenue 57,001 97,006 (40,005) 170.18%
Total Operating Revenue: 1,765,413 968,498 796,915 54.86%
Revenue(Non-Operating):
Interest 20,000 11,903 8,097 59.52%
Other Non-Operating Revenue 3,975 255,511 (251,536) 6427.95%
Total Non-Operating Revenue: 23,975 267,414 (243,439) 1115.39%
Total Revenue 1,789,388 1,235,912 553,476 69.07%
Expenses(Operating):
Salary Related Expenses 987,775 469,641 518,134 49.14%
Supplies&Services:
Communications 27,797 8,176 19,621 29.41%
Contractual Services 39,733 15,641 24,092 39.36%
Data Processing 9,006 3,393 5,613 37.68%
Dues& Memberships 4,213 3,831 382 90.93%
Fees& Permits 10,540 5,313 5,227 50.41%
Insurance 16,674 13,603 3,071 81.58%
Materials 27,184 12,818 14,366 47.15%
District Activities, Emp Recognition 1,562 611 951 39.11%
Maintenance 74,267 35,359 38,908 47.61%
Non-Capital Equipment 18,799 9,954 8,845 52.95%
Office Expense 3,439 1,392 2,047 40.48%
Professional Services 59,794 38,083 21,711 63.69%
Training 3,761 3,925 (164) 104.37%
Travel &Conferences 3,630 929 2,701 25.60%
Uncollectible Accounts 2,660 14 2,646 0.53%
Utilities 8,645 3,006 5,639 34.77%
Vehicle Equipment 78,341 21,616 56,725 27.59%
Supplies&Services Sub-Total 390,045 177,664 212,381 45.55%
Total Operating Expenses 1,377,820 647,305 730,515 46.98%
Expenses(Non-Operating):
Interest Expense on Long Term Debt - 325 (325) 0.00%
Other Expense 6,000 15,770 (9,770) 262.83%
Total Non-Operating Expenses: ) 6,000.00 16,095.00 ( 10,095.00) 2.68
Total Expenses 1,383,820 663,400 720,420 47.94%
Net Income(Loss) Before Capital Contributions 405,568 572,512 (166,944) 141.16%
Contributed Capital - 17,044,890 17,044,890 0.00%
Net Income(Loss) Before Depreciation 405,568 17,617,402 16,877,946 4343.88%
Depreciation&Amortization 932,700 591,473 341,227 63.42%
Total Net Income(Loss) ($527,132) $17,025,929 $16,536,719 -3229.92%
Capital-Direct Labor (15,739) (15,739)
ITEM NO. 3.1
AGENDA REPORT
Meeting Date: February 27, 2012
To: Finance-Accounting Committee
From: Ken Vecchiarelli, General
Manager
Presented By: Stephen Parker, Finance Dept: Finance
Manager
Prepared By: Delia Lugo, Senior Accountant
Subject: December 2011 Debt Service Ratio
DISCUSSION:
Yorba Linda Water District covenanted with the issuance of the 2003 and 2008 Certificates of
Participation (COP's), "... to fix, prescribe and collect rates and charges for Water Service which will
be at least sufficient to yield during each Fiscal Year, Net Revenues equal to 110% of the Debt
Service for such Fiscal Year." To confirm the covenant is upheld, a calculation is made and
reviewed by the external auditors and included in the Comprehensive Annual Financial Report.
Honoring these covenants allows the District to maintain high bond rating and provides confidence
in the financial markets for any bond resales and future issuances.
The June 30, 2011 audit revealed that the District's debt service calculation was 183% - well above
the rate covenant. The staff calculates the District's debt service ratio on a quarterly basis and
reports this figure to the Finance-Accounting Committee. Accordingly, December 2011's unaudited
debt service ratio is 217% as shown in the attached calculation. As we traditionally receive
approximately 55% of our revenues but only 50% of our expenses in the first half of the year, this
figure is expected to drop some by the end of the year. Despite this observation, the District's
financial health for the first half of Fiscal Year 2011-12 is strong as it pertains to the debt service
ratio indicator.
STRATEGIC PLAN:
FR 1-E: Maintain Commitment to a Strong Debt Services Ratio
ATTACHMENTS:
Name: Description: Type:
FY 2011-12 2nd Qtr DS Calc.xlsx December 2011 Debt Service Ratio Backup Material
Yorba Linda Water District
Water Fund
For The Period Ending December 31, 2011
YTD Included in
Actual Debt Service
FY 2012 Ratio Calculation
OPERATING REVENUES:
Water sales $ 13,565,446 $ 13,565,446
Other operating revenues 445,857 445,857
TOTAL OPERATING REVENUES 14,011,303 14,011,303
OPERATING EXPENSES
Variable water costs 7,183,755 7,183,755
Personnel services 3,141,844 3,141,844
Supplies and services 1,610,041 1,610,041
Depreciation and amortization 2,675,828 -
TOTAL OPERATING EXPENSES 14,611,468 11,935,640
OPERATING INCOME/(LOSS) (600,165) 2,075,663
NONOPERATING REVENUES (EXPENSES):
Property taxes 677,509 677,509
Investment income 137,221 137,221
Interest expense (948,692) -
Other nonoperating revenues 228,507 228,507
Other nonoperating expenses (70,423) (70,423)
TOTAL NONOPERATING REVENUES/EXPENSES 24,122 972,814
NET INCOME/(LOSS) BEFORE CAPITAL
CONTRIBUTIONS (576,043) 3,048,477
CAPITAL CONTRIBUTIONS 16,536 -
CHANGES IN NET ASSETS (559,507) 3,048,477
DEBT SERVICE RATIO CALCUATION:
NET REVENUES 3,048,477
DEBT SERVICE 1,402,589
% 217%
ITEM NO. 3.2
AGENDA REPORT
Meeting Date: February 27, 2012
To: Finance-Accounting Committee
From: Ken Vecchiarelli, General
Manager
Presented By: Stephen Parker, Finance Dept: Finance
Manager
Prepared By: Delia Lugo, Senior Accountant
Subject: Investment Report for Period Ending January 2012
SUMMARY:
Staff is submitting the January 2012 Monthly Investment Reports for the Committee's review.
DISCUSSION:
The Investment Portfolio Report presents the market value and percent yield for all 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 January 2012 increased to 1 .03%. This is the result of spending
down the 2008 Revenue Bond held in a money market account earning only 0.05%, despite the
yield change of investments held in CaITRUST's Medium Term portfolio from 1.19% to 1 .15%.
The overall decrease in the investment balance from the previous month is $1 ,895,000. A couple of
the larger balance changes include an increase in the Reserve for Debt Service fund of $158,000
due to the District meeting its monthly obligation to ensure that funds are set aside for the March
2012 debt service interest payment, a decrease of $685,000 in the Water Operating fund primarily
due to payments to OCWD for annexation charges and the bi-annual replenishment assessment,
and a decrease of $1 ,425,000 in the 2008 COP Revenue account for CIP project activity.
STRATEGIC PLAN:
FR 3-C: Manage Cash Flow to Maximize Investment Income
ATTACHMENTS:
Name: Description: Type:
Invst Rpt 01-12.xlsx January 2012 Investment Report Backup Material
Invst Agenda Backup - Jan 2012.xlsx Agenda Backup Backup Material
Yorba Linda Water District
Investment Portfolio Report
January 31, 2012
Market % Percent
Value Cost of Total Institution Yield
Checking Account:
$ 103,306 $ 103,306 Wells Fargo Bank
$ 103,306 $ 103,306 0.38% Total 0.00%
Money Market Accounts:
$ 9,982 $ 9,982 Wells Fargo Money Market 0.05%
214,390 214,390 US Bank(2008 Revenue Bond) 0.05%
2,699 2,699 US Bank(2008 Bond Reserve) 0.05%
$ 227,071 $ 227,071 0.84% Total 0.05%
Federal Home Loan Bank:
$ 2,165,866 $ 2,144,397 US Bank(2008 Bond Reserve) 1.34%
$ 2,165,866 $ 2,144,397 8.05% 1.34%
Pooled Investment Accounts:
$ 4,221,075 $ 4,221,075 Local Agency Investment Fund 0.39%
20,192,917 20,111,472 Ca1TRUST Medium Term 1.15%
$ 24,413,992 $ 24,332,547 90.72% 1.02%
$ 26,910,235 $ 26,807,321 100% Total Investments 1.03%
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
1/31/12
Investment Summary Report
Below is a chart summarizing the yields as well as terms and maturities for the month of January 2012:
Avg. Portfolio Avg. Portfolio #of
Month Yield Without Yield With Days to
of 2012 CaITRUST CaITRUST Maturity
January 0.68% 1.03% 565
Below is are charts comparing operating fund interest for current and prior fiscal years.
Actual Interest 1/31/2011 1/31/2012
Monthly-January $ 21,917 $ 24,030
Year-to-Date $ 133,017 $ 149,274
Budget 2010/2011 2011/2012
Interest Budget, January YTD $ 91,000 $ 110,833
Interest Budget, Annual $ 156,000 $ 190,000
Interest earned on investments is recorded in the fund that owns the investment.
Investment Summary Comparison Between Current and Previous Month
The distribution of investments in the portfolio both in dollars and as a percentage of the total portfolio by funds
is as follows:
December 2011 % Alloc Janaury 2012 %Alloc
Fund Description Balance 12/31/2011 Balance 1/31/2012
Water Operating Reserve $ 3,290,837 11.45% $ 2,605,487 11.45%
Water Emergency Reserve 1,002,119 3.48% 1,005,122 3.48%
Water Capital Project Reserve 17,577,157 61.10% 17,554,662 61.10%
Water Reserve for Debt Service 775,025 2.69% 933,263 2.69%
COP Revenue Bond 2008- Reserve 2,159,386 7.51% 2,165,866 7.51%
COP Revenue Bond 2008 1,642,550 5.71% 217,089 5.71%
Sewer Operating 170,718 0.59% 277,589 0.59%
Sewer Emergency Reserve 1,001,472 3.48% 1,004,473 3.48%
Sewer Capital Project Reserve 1,146,982 3.99% 1,043,378 3.99%
$ 28,766,246 100.00% $ 26,806,929 100.00%
Wells Fargo Bank Checking
Water Operating (4,835) 21,930
Sewer Operating 43,504 81,376
38,669 103,306
Totals $ 28,804,915 $ 26,910,235
ITEM NO. 3.3
AGENDA REPORT
Meeting Date: February 27, 2012
To: Finance-Accounting Committee
From: Ken Vecchiarelli, General Manager
Presented By: Stephen Parker, Finance Manager Dept: Finance
Prepared By: Delia Lugo, Senior Accountant
Subject: January 2012 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 January 2012.
For the month of January 2012, the District water revenue is trending slightly below expectations. Water
operating revenue is 58% of annual budget, which is lower by approximately 2.4% from the historical trend for
the first seven reporting months of the fiscal year. Our 20 by 2020 baseline is 286.1 gallons per capita per day
(GPCD), with a target of 228.9. For the current fiscal year through January 2012, the reduction of 42.9 GPCD
brings us 75% of the way to our goal.
Other Operating Revenue is 71% of annual budget for the month of January. This is primarily due to the
activity that was reported in the previous months in relation to the Vista Del Verde project.
The majority of the Water Funds individual supplies and services expenses are trending below or on budget,
with the exception of Dues and Memberships and Insurance due to timing differences, Maintenance due to
unexpected road repairs and Materials due to unbudgeted replacement meter purchases.
In the month of January Sewer Other Operating Revenue is well over budget due to the Vista del Verde
Project as reported in previous months. Sewer Other Non-Operating revenue is also well over budget,
primarily due to receiving $264,000 from the City of Yorba Linda for the sewer transfer. The supplies and
services expenses are trending below or on budget, with the exceptions of Dues and Memberships, Insurance
and Maintenance for the same reasons as described for the Water Fund and Training due to unbudgeted
training for class "A" driver's licenses needed for 3 sewer employees in order to drive the sewer vactor.
In the month of January the District recorded a transfer of the Lomas De Yorba facility from the Water to the
Sewer Fund, and subsequently recorded the transfer of that asset to the City of Yorba Linda in the
Contributed Capital line item of the Sewer Statement. This entry satisfies the District's obligation as set forth in
the Sewer System Agreement between the District and the City of Yorba Linda.
ATTACHMENTS:
Name: Description: Type:
January 2012 Combined.xls Janaury 2012 Consolidated Statement Backup Material
January 2012 Water.xlsx January 2012 Water Statement Backup Material
January 2012 Sewer.xls January 2012 Sewer Statement Backup Material
Yorba Linda Water District
Summary Financial Report
Water&Sewer Funds
For Seven Months Ending January 31, 2012
Original YTD YTD YTD
Budget Actual Under(Over) % of
FY 2012 FY 2012 Budget Budget
Revenue (Operating):
Water Revenue (Residential) $17,904,893 $9,810,923 $8,093,970 54.79%
Water Revenue (Commercial & Fire Det.) 1,726,651 1,146,285 580,366 66.39%
Water Revenue (Landscape/Irrigation) 3,757,058 2,504,682 1,252,376 66.67%
Water Revenue (Service Charge) 3,406,392 1,963,812 1,442,580 57.65%
Sewer Charge Revenue 1,548,550 890,329 658,221 57.49%
Locke Ranch Assessments 159,862 112,160 47,702 70.16%
Other Operating Revenue 754,361 592,585 161,776 78.55%
Total Operating Revenue: 29,257,767 17,020,776 12,236,991 58.18%
Revenue (Non-Operating):
Interest 190,000 149,274 40,726 78.57%
Property Tax 1,232,000 716,797 515,203 58.18%
Other Non-Operating Revenue 499,369 614,324 (114,955) 123.02%
Total Non-Operating Revenue: 1,921,369 1,480,395 440,974 77.05%
Total Revenue 31,179,136 18,501,171 12,677,965 59.34%
Expenses (Operating):
Variable Water Costs (G.W., Import& Power) 13,671,538 7,859,937 5,811,601 57.49%
Salary Related Expenses 7,941,306 3,926,757 4,014,549 49.45%
Supplies& Services 4,070,833 2,100,397 1,970,436 51.60%
Total Operating Expenses 25,683,677 13,887,091 11,796,586 54.07%
Expenses (Non-Operating):
Interest on Long Term Debt 1,906,426 1,104,955 801,471 57.96%
Other Expense 123,193 88,060 35,133 71.48%
Total Non-Operating Expenses: 2,029,619 1,193,015 836,604 58.78%
Total Expenses 27,713,296 15,080,106 12,633,190 54.41%
Net Income(Loss) Before Capital Contributions 3,465,840 3,421,065 44,775 98.71%
Contributed Capital - 16,976,316 16,976,316 0.00%
Net Income(Loss) Before Depreciation 3,465,840 20,397,381 17,021,091 588.53%
Depreciation &Amortization 5,561,699 3,819,417 1,742,282 68.67%
Total Net Income (Loss) ($2,095,859) $16,577,964 $15,278,809 -790.99%
Capital- Direct Labor - (221,976) (221,976)
Yorba Linda Water District
Water Fund
For Seven Months Ending January 31,2012
Jan YTD YTD YTD
Budget Actual Actual Under(Over) % of
FY 2012 FY 2012 FY 2012 Budget Budget
Revenue(Operating):
Water Revenue (Residential) $17,904,893 $1,229,880 $9,810,923 $8,093,970 54.79%
Water Revenue (Commercial & Fire Det.) 1,726,651 142,898 1,146,285 580,366 66.39%
Water Revenue (Landscape/Irrigation) 3,757,058 206,506 2,504,682 1,252,376 66.67%
Water Revenue (Service Charge) 3,406,392 280,972 1,963,812 1,442,580 57.65%
Other Operating Revenue 697,360 50,148 496,005 201,355 71.13%
Total Operating Revenue: 27,492,354 1,910,404 15,921,707 11,570,647 57.91%
Revenue(Non-Operating):
Interest 170,000 150 137,371 32,629 80.81%
Property Tax 1,232,000 39,288 716,797 515,203 58.18%
Other Non-Operating Revenue 495,394 126,310 354,818 140,576 71.62%
Total Non-Operating Revenue: 1,897,394 165,748 1,208,986 688,408 63.72%
Total Revenue 29,389,748 2,076,152 17,130,693 12,259,055 58.29%
Expenses (Operating):
Variable Water Costs (G.W., Import& Power) 13,671,538 676,182 7,859,937 5,811,601 57.49%
Salary Related Expenses 6,953,531 278,680 3,420,523 3,533,008 52.13%
Supplies &Services:
Communications 369,303 (104) 104,456 264,847 28.28%
Contractual Services 527,888 36,244 237,685 290,203 45.03%
Data Processing 119,645 (20,616) 56,283 63,362 47.04%
Dues & Memberships 55,973 3,314 49,665 6,308 88.73%
Fees &Permits 140,030 (1,330) 71,733 68,297 51.23%
Insurance 221,526 87,924 181,088 40,438 81.75%
Materials 361,161 38,824 273,696 87,465 75.78%
District Activities, Emp Recognition 20,758 183 8,514 12,244 41.02%
Maintenance 418,603 16,557 248,734 169,869 59.42%
Non-Capital Equipment 79,221 6,106 34,566 44,655 43.63%
Office Expense 45,686 5,920 24,407 21,279 53.42%
Professional Services 794,406 107,809 411,310 383,096 51.78%
Training 49,964 (77) 21,667 28,297 43.37%
Travel &Conferences 48,221 (578) 11,338 36,883 23.51%
Uncollectible Accounts 35,340 - 432 34,908 1.22%
Utilities 114,855 2,188 40,019 74,836 34.84%
Vehicle Equipment 278,209 19,521 136,331 141,878 49.00%
Supplies &Services Sub-Total 3,680,788 301,885 1,911,924 1,768,864 51.94%
Total Operating Expenses 24,305,857 1,256,747 13,192,384 11,113,473 54.28%
Expenses (Non-Operating):
Interest on Long Term Debt 1,906,426 155,938 1,104,630 801,796 57.94%
Other Expense 117,193 1,697 72,120 45,073 61.54%
Total Non-Operating Expenses: 2,023,619 157,635 1,176,750 846,869 58.15%
Total Expenses 26,329,476 1,414,382 14,369,134 11,960,342 54.57%
Net Income(Loss) Before Capital Contributions 3,060,272 661,770 2,761,559 298,713 90.24%
and Transfers
Transfers(To)/From - (85,111) (85,111) (85,111) 0.00%
Capital Contributions - - 16,537 16,537 0.00%
Net Income(Loss) Before Depreciation 3,060,272 576,659 2,692,985 230,139 88.00%
Depreciation &Amortization 4,628,999 444,774 3,120,603 1,508,396 67.41%
Total Net Income(Loss) ($1,568,727) $131,885 ($427,618) ($1,278,257) 27.26%
Capital- Direct Labor - (22,516) (204,277) (204,277) -
Yorba Linda Water District
Sewer Fund
For Seven Months Ending January 31,2012
Jan YTD YTD YTD
Budget Actual Actual Under(Over) %of
FY 2012 FY 2012 FY 2012 Budget Budget
Revenue(Operating):
Sewer Charge Revenue $1,548,550 $127,593 $890,329 $658,221 57.49%
Locke Ranch Assessments 159,862 3,404 112,160 47,702 70.16%
Other Operating Revenue 57,001 (426) 96,580 (39,579) 169.44%
Total Operating Revenue: 1,765,413 130,571 1,099,069 666,344 62.26%
Revenue(Non-Operating):
Interest 20,000 - 11,903 8,097 59.52%
Other Non-Operating Revenue 3,975 3,995 259,506 (255,531) 6528.45%
Total Non-Operating Revenue: 23,975 3,995 271,409 (247,434) 1132.05%
Total Revenue 1,789,388 134,566 1,370,478 418,910 76.59%
Expenses(Operating):
Salary Related Expenses 987,775 36,593 506,234 481,541 53.04%
Supplies&Services:
Communications 27,797 (8) 8,168 19,629 29.38%
Contractual Services 39,733 2,792 18,433 21,300 46.39%
Data Processing 9,006 (1,558) 1,835 7,171 20.38%
Dues&Memberships 4,213 249 4,080 133 96.84%
Fees&Permits 10,540 (145) 5,168 5,372 49.03%
Insurance 16,674 - 13,603 3,071 81.58%
Materials 27,184 252 13,070 14,114 48.08%
District Activities, Emp Recognition 1,562 29 640 922 40.96%
Maintenance 74,267 15,861 51,220 23,047 68.97%
Non-Capital Equipment 18,799 370 10,324 8,475 54.92%
Office Expense 3,439 446 1,838 1,601 53.45%
Professional Services 59,794 (13,911) 24,172 35,622 40.43%
Training 3,761 (19) 3,906 (145) 103.86%
Travel&Conferences 3,630 (44) 885 2,745 24.38%
Uncollectible Accounts 2,660 - 14 2,646 0.53%
Utilities 8,645 212 3,218 5,427 37.22%
Vehicle Equipment 78,341 6,283 27,899 50,442 35.61%
Supplies&Services Sub-Total 390,045 10,809 188,473 201,572 48.32%
Total Operating Expenses 1,377,820 47,402 694,707 683,113 50.42%
Expenses(Non-Operating):
Interest Expense - - 325 (325) 0.00%
Other Expense 6,000 170 15,940 (9,940) 265.67%
Total Non-Operating Expenses: 6,000 170 16,265 (10,265) 271.08%
Total Expenses 1,383,820 47,572 710,972 672,848 51.38%
Net Income(Loss)Before Capital Contributions 405,568 86,994 659,506 (253,938) 162.61%
and Transfers
Transfers(To)/From - 85,111 85,111 85,111 0.00%
Contributed Capital - (85,111) 16,959,779 16,959,779 0.00%
Net Income(Loss)Before Depreciation 405,568 86,994 17,704,396 16,790,952 4365.33%
Depreciation&Amortization 932,700 107,341 698,814 233,886 74.92%
Total Net Income(Loss) ($527,132) ($20,347) $17,005,582 $16,557,066 -3226.06%
Capital-Direct Labor - (1,959) (17,698) (17,698)
ITEM NO. 3.4
AGENDA REPORT
Meeting Date: February 27, 2012
To: Finance-Accounting Committee
From: Ken Vecchiarelli, General
Manager
Presented By: Stephen Parker, Finance
Manager
Prepared By: Delia Lugo, Senior Accountant
Subject: Draft Finance Department Budget
DISCUSSION:
The Finance Department has decreased its Supplies and Services budget by 15% down to
$387,871. The most significant cuts this year were made in the areas of consulting under
professional services and office expense.
73% 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 the writing off of
uncollectible accounts amounting to 93% of that section's budget. In the Administration Section, the
expense of external auditors and consulting services for items like our accounting software, bond
reporting and updating our financial plan model account for over 88% of the budget. In the
Accounting Section, our bank service fees and office supplies for the administrative building account
for over 90% of the budget. Lastly, in the Meter Services Section, meter registers account for over
78% of the budget.
ATTACHMENTS:
Nan Description: Type:
Finance Budget Summary for FY 2012-13.xlsx Finance Budget Summary Backup Material
3010 Budget for 2013.pdf Administration Budget Detail Backup Material
3020 Budget for 2013.pdf Accounting Budget Detail Backup Material
3030 Budget for 2013.pdf Customer Service Budget Detail Backup Material
3040 Budget for 2013.pdf Meter Reading Budget Detail Backup Material
Finance Budget Summary
Proposed for Fiscal Year 2012/2013
FY 2011/12 Proposed FY
1EKp9Dsesj0peratinq) Amended Budget 2012/13 Budget
Supplies &Services
Communications $ 103,000 $ 88,000
Contractual Services $ 83,690 $ 88,161
Dues & Memberships $ 1,425 $ 1,405
Fees & Permits $ 87,220 $ 95,995
Insurance $ 500 $ -
Materials $ 15,320 $ 12,000
District Activities & Events $ 920 $ 700
Maintenance $ 200 $ 200
Non-Capital Equipment $ 2,200 $ 1,250
Office Expense $ 21,550 $ 16,600
Professional Services $ 92,000 $ 36,160
Professional Development $ 4,100 $ 4,250
Travel & Conferences $ 7,000 $ 4,150
Uncollectible Accounts $ 38,000 $ 39,000
Supplies &Services Sub-Total $ 457,125 $ 387,871
Section Detail Expense Budget
Dept/Section: Fin (Admin) (3010) FY 2013
Primary GIL Category Sub Acct No./Sub Category Detail Item Description
1-3010-0600-00 $375 1-3010-0600-00 375 Check signature plate 375
CONTRACTUAL SERVICES(E) CONTRACTUAL SERVICES(E)
1-3010-0640-00 $445 1-3010-0640-00 445 CSMFO 110
DUES,MEMBERSHIPS,SUBSCRI DUES,MEMBERSHIPS,SUBSCRIPTI
PTIONS(E) ONS(E) CMTA 185
GFOA 150
1-3010-0715-00 $350 1-3010-0715-50 350 Meeting Supplies 350
District Activities&Events Meeting Supplies
1-3010-0760-00 $300 1-3010-0760-30 300 Reference Books 300
OFFICE EXPENSE(E) Books&Publications
1-3010-0780-00 $34,960 1-3010-0780-00 34,960 GP consulting 5,000
PROFESSIONAL SERVICES(E) PROFESSIONAL SERVICES(E) Auditors 18,960
Bond counsel 1,000
Post-issuance bond consulting 2,000
Project consulting 5,000
Financial plan model consulting 3,000
1-3010-0810-00 $850 1-3010-0810-00 850 GASB Updates 100
PROFESSIONAL DEVELOPMENT Training Misc Training 200
CSMFO Webinars/Luncheons 250
CDIAC Training 300
1-3010-0830-00 $2,250 1-3010-0830-00 2,250 GFOA Conference 1,500
TRAVEL&CONFERENCES(E) TRAVEL&CONFERENCES(E) CSMFO Conference 750
Section Total $39,530
Section Detail Expense Budget
Dept/Section: Fin (Accounting) FY 2013
(3020)
Primary GIL Category— -.� Sub Acct No./Sub Category Detail Item Description
M
1-3020-0580-00 $400 1-3020-0580-00 400 Publish Unclaimed List 400
COMMUNICATIONS(E) COMMUNICATIONS(E)
1-3020-0600-00 $570 1-3020-0600-30 570 Check signer 570
CONTRACTUAL SERVICES(E) Warranties&Service Contracts
1-3020-0640-00 $710 1-3020-0640-00 710 Delia Lugo-CSMFO,GFOA,etc. 300
DUES,MEMBERSHIPS,SUBSCRI DUES,MEM BERSHI PS,SUBSCRIPTI
PTIONS(E) ONS(E) Maria Trujillo-CSMFO 110
Joann-CSMFO,GFOA,etc 300
1-3020-0645-00 $30,995 1-3020-0645-00 865 CSMFO Budget Reviewer Fee 100
Fees&Permits Fees&Permits
GFOA CAFR Reviewer Fee 435
GFOA Budget Award Reviewer Fee 330
1-3020-0645-50 30,130 Analysis Fees(avg$2550/mo) 30,000
Bank Service/Fees
Safe Deposit Box Fee 100
Annual Bankcard Fee 30
1-3020-0715-00 $200 1-3020-0715-50 200 Meeting Supplies 200
District Activities and Events Meeting Supplies
1-3020-0730-00 $200 1-3020-0730-00 200 Misc(typewriter,etc.) 200
MAINTENANCE(E) MAINTENANCE(E)
1-3020-0750-00 $200 1-3020-0750-00 200 Mlsc.Small Equipment(Ergonomic,etc.) 200
NON-CAPITAL EQUIPMENT(E) NON-CAPITAL EQUIPMENT(E)
1-3020-0760-00 $14,300 1-3020-0760-00 10,100 Office supplies 10,000
OFFICE EXPENSE(E) OFFICE EXPENSE(E) Ribbon(Check signing machine) 100
1-3020-0760-10 4,000 Paper 4,000
Paper
1-3020-0760-30 200 Govt Tax Text-Diehl Evans 200
Books&Publications
1-3020-0810-00 $1,300 1-3020-0810-00 1,300 Staff Training 1,000
PROFESSIONAL DEVELOPMENT PROFESSIONAL DEVELOPMENT
GP Dynamics-Smartlist Builder 300
1-3020-0830-00 $400 1-3020-0830-00 400 Mileage 100
TRAVEL&CONFERENCES(E) TRAVEL&CONFERENCES(E) PERS Conference 300
Section Total $49,275
Section Detail Expense Budget
Dept/Section: Fin (CS & Billing) FY 2013
(3030)
Primary GIL Category-, Sub Acct No./Sub Category Detail Item Description
1-3030-0580-00 $87,600 1-3030-0580-00 600 UPS/Fed Ex/Other 600
COMMUNICATIONS(E) COMMUNICATIONS(E)
1-3030-0580-10 2,000 Postage Metered 2,000
Postage
1-3030-0580-22 85,000 Postage-Infosend 85,000
Postage-Infosend
1-3030-0600-00 $86,616 1-3030-0600-00 1,500 Post Office Box 180
CONTRACTUAL SERVICES(E) CONTRACTUAL SERVICES(E) Post Master-Lockbox 1,320
1-3030-0600-21 6,000 Online-Credit Checks 6,000
Customer Credit Check
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 1,116 Meter&Scale Lease Agreement 1,116
Warranties&Service Contracts
1-3030-0600-55 8,000 Phone Answering Service 8,000
Answering Service
1-3030-0600-70 15,000 Temporary Employment 15,000
Temporary Employment Services
1-3030-0645-00 $65,000 1-3030-0645-50 65,000 Lock Box Services 25,000
Fees&Permits Bank Services/Fees
Credit Card&Auto Dr Processing 40,000
1-3030-0715-00 $150 1-3030-0715-50 150 Meeting Supplies 150
District Activities and Events Meeting Supplies
1-3030-0750-00 $300 1-3030-0750-00 300 Miscellaneous Equipment 300
NON-CAPITAL EQUIPMENT(E) NON-CAPITAL EQUIPMENT(E)
1-3030-0760-00 $2,000 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
1-3030-0780-00 $1,200 1-3030-0780-09 1,200 Agency Fee 1,200
PROFESSIONAL SERVICES(E) Collection Services
1-3030-0810-00 $1,600 1-3030-0810-00 1,600 Cust Sery Reps Seminar 1,000
PROFESSIONAL DEVELOPMENT PROFESSIONAL DEVELOPMENT
Supervisor Training 600
1-3030-0830-00 $200 1-3030-0830-00 200 Mileage 200
TRAVEL&CONFERENCES(E) TRAVEL&CONFERENCES(E)
1-3030-0850-00 $39,000 1-3030-0850-00 39,000 Uncollectible Accounts 39,000
UNCOLLECTIBLE ACCOUNTS(E) UNCOLLECTIBLE ACCOUNTS(E)
Section Total $283,666
Section Detail Expense Budget
Dept/Section: Fin (Meter Reading) FY 2013
(3040)
Primary GIL Category—I -.� Sub Acct No./Sub Category Detail Item Description
M
1-3040-0600-00 $600 1-3040-0600-50 600 Uniforms 600
CONTRACTUAL SERVICES(E) Uniform
1-3040-0640-00 $250 1-3040-0640-00 250 AWWA 250
DUES,MEMBERSHIPS,SUBSCRI DUES,MEMBERSHIPS,SUBSCRIPTI
PTIONS(E) ONS(E)
1-3040-0710-00 $12,000 1-3040-0710-58 12,000 Registers 12,000
MATERIALS(E) Registers
1-3040-0750-00 $750 1-3040-0750-00 500 Meter Shop Equipment 500
NON-CAPITAL EQUIPMENT(E) NON-CAPITAL EQUIPMENT(E)
1-3040-0750-10 250 Hand Tools/Meter Lid Bars/Lifters 250
Hand and Power Tools
1-3040-0810-00 $500 1-3040-0810-00 500 Training classes 500
PROFESSIONAL DEVELOPMENT PROFESSIONAL DEVELOPMENT
1-3040-0830-00 $1,300 1-3040-0830-00 1,300 AWWA Conference 1,300
TRAVEL&CONFERENCES(E) TRAVEL&CONFERENCES(E)
Section Total $15,400
ITEM NO. 3.5
AGENDA REPORT
Meeting Date: February 27, 2012
To: Finance-Accounting Committee
From: Ken Vecchiarelli, General
Manager
Presented By: Stephen Parker, Finance Dept: Finance
Manager
Prepared By: Stephen Parker, Finance
Manager
Subject: Preliminary 2013 Budget Numbers
SUMMARY:
Presented for review and discussion are the preliminary FY 2012/13 budget revenues and
expenses of the District. This information includes a number of assumptions as we are early in the
budget process, but provides an overview of what next years' budget will look like.
DISCUSSION:
Operating revenues are initially lower by 1% based on no rate increase, an assumption revision
from 5% to 6% water loss based on last years' calculations and a slight lowering of operating
revenues based on customer service fees decreasing as a result of upcoming fee changes.
Variable water costs are up over $700,000 or 5% as a result of a 4% OCWD increase effective July
1 , 2012, and a 5% MET increase taking effect January 1 , 2013.
Preliminary numbers for personnel expenses do not currently include any potential cost of living
allowance, but does factor in potential step increases for merit as well as adjustments for health
insurance and PERS expenses. Personnel expenses are actually lower than last year based on
current information.
Supplies and services have been scrutinized by staff and have decreased by over 7% from last
years' budget.
Depreciation expense has increased by over 20% from last years' budget due to higher than
expected expense from the Sewers that the City of Yorba Linda transferred to the District as well as
an increase in completed projects in the water fund.
ATTACHMENTS:
Name: Description: Type:
Version 1 of 2012-13 Budget.xlsx Preliminary 2013 Budget-Combined Backup Material
Consolidated Proposed
Budget Budget
FY2012 FY 2013
Revenue(Operating):
Water Revenue(Residential) $17,904,893 16,934,400
Water Revenue(Commercial&Fire Det.) 1,726,651 1,909,656
Water Revenue(Landscape/Irrigation) 3,757,058 4,208,843
Water Revenue(Service Charge) 3,406,392 3,406,392
Sewer Charge Revenue 1,548,550 1,548,550
Locke Ranch Assessments 159,862 159,862
Other Operating Revenue 754,361 664,900
Total Operating Revenue: 29,257,767 28,832,603
Revenue(Non-Operating):
Interest 190,000 175,000
Property Tax 1,232,000 1,244,320
Other Non-Operating Revenue 499,369 479,363
Total Non-Operating Revenue: 1,921,369 1,898,683
Total Revenue 31,179,136 30,731,286
Expenses(Operating):
Variable Water Costs(G.W., Import&Power) 13,671,538 14,385,538
Salary Related Expenses 7,941,306 7,879,867
Supplies&Services:
Communications 397,100 308,250
Contractual Services 567,621 496,671
Data Processing 128,650 128,240
Dues&Memberships 60,186 61,192
Board Election Fees - 63,500
Fees&Permits 150,570 151,095
Insurance 238,200 279,200
Materials 388,345 490,025
District Activities, Emp Recognition 22,320 18,900
Maintenance 492,870 381,970
Non-Capital Equipment 98,020 86,100
Office Expense 49,125 41,225
Professional Services 854,200 719,460
Training 53,725 51,020
Travel&Conferences 51,851 43,700
Uncollectible Accounts 38,000 39,000
Utilities 123,500 85,000
Vehicle Equipment 356,550 333,900
Supplies&Services Sub-Total 4,070,833 3,778,448
Total Operating Expenses 25,683,677 26,043,853
Expenses(Non-Operating):
Interest on Long Term Debt 1,906,426 1,893,172
Other Expense 123,193 124,000
Total Non-Operating Expenses: 2,029,619 2,017,172
Total Expenses 27,713,296 28,061,025
Net Income(Loss) Before Depreciation 3,465,840 2,670,261
Depreciation&Amortization 5,561,699 6,884,018
Total Net Income(Loss) ($2,095,859) ($4,213,757)
ITEM NO. 3.6
AGENDA REPORT
Meeting Date: February 27, 2012
To: Finance-Accounting Committee
From: Ken Vecchiarelli, General
Manager
Presented By: Stephen Parker, Finance
Manager
Prepared By: Stephen Parker, Finance
Manager
Subject: FY 12/13 Budget Calendar Update
DISCUSSION:
Attached is the FY 2012/13 Budget Calendar with changes that have occurred since it was last
presented shown in red.
ATTACHMENTS:
Description: Type:
Budget Calendar - FY 12.13 2.23.12.xlsx FY 12/13 Budget Calendar Backup Material
BUDGET CALENDAR FOR FISCAL YEAR 2012/13
DATE BOARD/COMMITTEE SCHEDULE
JANUARY
January 17,2012 Manager's Meeting Discuss Budget Calendar and Process
Personnel &Capital budget discussion
January 23,2012 Finance-Accounting Committee Review the Budget Calendar
FEBRUARY
February 2, 2012 Planning-Engineering-Operations Committee Capital Improvement Projects budget(v 0.5)
February 23, 2012 Board of Directors Capital Improvement Projects budget(v 1.0)
February 27, 2012 Finance-Accounting Committee Finance budget(v 1.0), GperatiRg FGVGR6196(V 1.0)
Draft ouuyei w i.v)Reserve pelf y alysis(y 1 )
MARCH
March 1, 2012 Planning-Engineering-Operations Committee Engineering and Operations budget(v 1.0)
March 5, 2012 Public Affairs-Communications-Tech Committee IT& Public Affairs budget(v 1.0)
March 8, 2012 Board of Directors Capital Improvement Projects budget(v 2.0)(if needed)
March 13, 2012 Personnel-Risk Mgmt Committee Labor and benefits(v 1.0), HR budget(v 1.0)
March 20, 2012 Exec-Admin-Organizational Committee Board of Directors and Administration budget(v 1.0)
March 22, 2012 Board of Directors Capital Improvement Projects budget(v 3.0)(if needed)
March 26, 2012 Finance-Accounting Committee Finance budget(v 2.0)(if needed), Reserve policy analysis(v .0)
* March 29, 2012 Planning-Engineering-Operations Committee Engineering and Operations budget(v 2.0)(if needed)
APRIL
April 2,2012 Public Affairs-Communications-Tech Committee IT& Public Affairs budget(v 2.0)(if needed)
* April 5,2012 Board Workshop-Budget Budget presented to Board for review and discussion
Reserve policy discussion
April 10, 2012 Personnel-Risk Mgmt Committee HR budget(v 2.0)(if needed), Labor and Benefits(v 2.0)
April 12, 2012 Board of Directors Possible Prop 218 decision
April 17, 2012 Exec-Admin-Organizational Committee Board of Directors and Administration budget(v 2.0)(if needed)
MAY
May 24,2012 Board of Directors Draft Budget(Full Board)
May 28,2012 Finance-Accounting Committee Possible reserve policy recommendation
Draft reserve policy
* May 31,2012 Board of Directors Prop 218 Public Hearing
JUNE
June 14, 2012 Board of Directors Budget review and possible adoption (Full Board)
Reserve policy possible adoption
June 28, 2012 Board of Directors Budget review and possible adoption (Full Board)
* Tentative date
ITEM NO. 3.7
AGENDA REPORT
Meeting Date: February 27, 2012
To: Finance-Accounting Committee
From: Ken Vecchiarelli, General
Manager
Presented By: Stephen Parker, Finance Dept: Finance
Manager
Prepared By: Stephen Parker, Finance
Manager
Subject: Upcoming Pension Accounting Changes
DISCUSSION:
Governmental Accounting Standards Board (GASB) is the rule-setting body responsible for
reporting standards in accounting - otherwise known as generally accepted accounting principles.
GASB has recently written an exposure draft on amending GASB 27 - the rule for pension
accounting standards for employers in cost sharing and multiple-employer plans (the category that
YLWD falls into). An exposure draft provides for comments by affected parties and potentially allows
time for the rules as proposed to be revised. Staff is sharing the information as recorded in the
exposure draft to give advance notice of what is likely to come in the future recording of pensions on
the financial statements.
GASB is proposing changing the way that the liability of pensions are recorded on the financial
statements. Namely,
• Putting the entire pension liability on the balance sheet instead of the current footnote
disclosure by recognizing the employer's "proportionate share" of collective net pension
liability and pension expense. This is the component that is most probably not going to be
included when GASB is likely to adopt the amendment in or about June 2012.
• Changing the discount rate (the rate at which future benefit payments are discounted to their
present value) from the current expected rate of return (7.75% assumed by PERS) to either a
risk-free rate of return (average bond rates) or a combination of long-term rate of return until
current assets are depleted, then risk free thereafter.
• Shortening the amortization period for recognizing large changes. Currently PERS spreads
theirs over 15 years and recently performed a 3-year smoothing of one of the 15 years'
effects. The recommendation would be to recognize changes over the remaining service lives
of individual plan members.
• Recognizing investment earnings variance from projected within 5 years, which is a major
departure from PERS' current method.
• Other items that would not affect YLWD as dramatically, so are not explored in detail here.
The effect of these changes will be that the pension cost shown on the financial statements will
increase from what is currently shown in the footnotes. In addition, there might be a different
amount disclosed on the footnotes as compared to the financial statements. As a result of these
changes, either PERS will have to change the way they complete actuarials, or Districts' will have to
engage their own actuaries. It is also likely that whatever changes are accomplished on the pension
side will follow for Other Post-Employment Benefits in a few years.
At this point there are a lot more questions than answers. More information will be available in the
coming months, but the effective date that these changes are required to be implemented by the
District is FY 2013/14.
ITEM NO. 3.8
AGENDA REPORT
Meeting Date: February 27, 2012
Subject: Status of Strategic Plan Initiatives
DISCUSSION:
Attached are the strategies identified in the 2011-2013 Strategic Plan that relate to Fiscal
Responsibility, which are overseen by the Finance-Accounting Committee. Included is an update on
each strategy relating to Fiscal Responsibility.
ATTACHMENTS:
Name: Description: Type:
Strategic Plan Tracking- FA.xlsx Strategic Plan Tracking-FA Backup Material
Strategic Plan Initiatives Status Report
Finance-Accounting Committee
Strategies
Lead Party
Comments
Feb 2012 Progress
FR 1: Maintain Fiduciary Res onsibilit
Finance Accounting
Develop a Comprehensive
Committee to
5-year financial plan included in budget. A more comprehensive version
FR 1-A
Finance Director
consider Adding
Multi-Year Financial Plan
will be included in the FY 2012/13 budget.
Sewer Model to
Contract in Jun-1 1
Revise the Water and
Complete Study in
Sewer Rules and
House and
Water Rules and Regulations recommended changes submitted to EAO
General
Regulation and Evaluate
Recommend Fees
and corresponding recommended fee schedule changes submitted to
FR 1-C
Manager/
Fee Schedules Regularly
Structure Update for
FAC in December. These items are pending a legal review before both
for Proper Cost of Service
Finance Director
Adoption by
items are submitted to the Board.
Coverage
December 2011
FR 3: Identify and Develop Additional Revenue Options
Card Options
Review Opportunities to
Discussed with
On December 22, 2011, the Board approved YLWD entering into an
Earn"Cash Back" on
agreement with US Bank and the State of California in the CalCard
Finance-Accounting
FR 3-B
Operating Expense
Finance Director
Committee in March-
program. Staff has been given new information to provide US Bank
through Commercial
to complete the process. It should take another 3-5 weeks to get
Credit Card Accounts
Add'l research
fully set-up.
Required
FR 4: Provide a Rate Structure that Promotes Water Use Efficienc
Board to Consider
The January 16, 2012 Board Workshop showed the end product of the
Complete the Cost of
Finance
Rate Structure
cost of service and water rate study. Raftelis might continue work with
FR 4-A
Service and Water Rates
Director/Board
Alternatives in Oct
the District if a Prop 218 process is requested by the Board in
Study
of Directors
2011
conjunction with the fiscal year 2012-13 budget process.
Evaluate Equitable Rate
Board of
Board to Consider
Multiple rate structure options were presented to the Board in a
Structures that Promote
Directors/
Rate Structure
workshop on January 16, 2012. No specific direction was given on the
FR 4-B
Conservation and
General
Alternatives in Oct
rate structure, and this item will be discussed further throughout the
Efficiency
Manager
2011
fiscal year 2012-13 budget process .
Completed
Prepare a High Level
Annual Budget
Document and
Completed Budget June 2011. Submitted budget for CSMFO and GFOA
Comprehensive Annual
award September 2011. CAFR submitted to the FAC and Board in
Include Fees in FY
FR 1-13
Financial Report and
Finance Director
October 2011. Staff submitted for the GFOA award in November 2011.
2011/12 Budget
Compete for Recognition
YLWD received the Excellence in Budgeting Award from CSMFO on the
by the Government
FY 2011/12 Budget in January.
Finance Officers
Association
Revised Allocation
Evaluate and Revise the
Completed March 2011. Consider changing allocation methodology in
FR 1-D
Finance Director
included in FY
Sewer Fund Allocation
conjunction with FY 2012/13 budget process.
2011/12 Budget
Substantial Rate
Maintain Commitment to
Increase Adopted in
Board of
Quarterly review of debt service ratios will continue as well as
FR 1-E
Strong Debt Services
Sept 2009 followed by
Directors
integrating the ratio into forward financial projections.
Ratio
Pass Through
Increase in Aug 2010
Latest Revisions
Reviewed by Finance-
Review the Reserve Policy
Finance
Accounting
Completed review/revision of reserve policy in June 2011. Will review
FR 2-A
and Funding Levels
Director/Board
Committee for Board
again in conjunction with the 2012/13 Budget process.
Annually
of Directors
of Directors to
Consider in Jun-11
Implement an Approach
Finance
Rates, COP'S and
Forward projection of reserve balances will be completed along with
FR 2-C
to Ensure Reserves are
Director/Board
Other Capital
future financial projections. The District's reserve needs will be updated
Responsibly Funded
of Directors
Financing Options
for FY 2012/13 with this new data.
Track Opportunities
Manage Cash Flow to
Delia Lugo, Senior Accountant reviews the cash balances and needs
and Effectiveness
FR 3-C
Maximize Investment
Finance Director
daily. Mutliple times a month, excess cash is transferred to investments
with Quarterly
Income
to earn interest until the next check register.
Investment Reports