HomeMy WebLinkAbout2012-06-26 - Finance-Accounting Committee Meeting Agenda Packet Yorba Linda
Water District
AGENDA
YORBA LINDA WATER DISTRICT
FINANCE-ACCOUNTING COMMITTEE MEETING
Tuesday, June 26, 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. Authorization to Invest with Bank of the West
Recommendation: That the Committee recommend the Board of Directors
authorize staff to invest in a money market account with Bank of the West.
2.2. OPEB Liability Pay Down
Recommendation: That the Committee recommend the Board of Directors
authorize staff to deposit$275,297 ($175,297 Annual Required Contribution plus
$100,000 from Employee Liability Reserve) to the California Employees'Retirement
Benefit Trust (CERBT) for FY 2012113.
2.3. Prepayment of PERS Employer Contribution
Recommendation: That the Committee recommend the Board of Directors
authorize staff to prepay the District's employer portion of CalPERS'retirement
contribution for FY 2012113.
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. May 2012 Budget to Actual Results
3.2. Investment Report for Period Ending May 31 , 2012
3.3. Status of Strategic Plan Initiatives
3.4. Future Agenda Items and Staff Tasks
4. ADJOURNMENT
4.1. The next meeting of the Finance-Accounting Committee will be held July 23, 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: June 26, 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: Authorization to Invest with Bank of the West
STAFF RECOMMENDATION:
That the Committee recommend the Board of Directors authorize staff to invest in a money market
account with Bank of the West.
DISCUSSION:
Staff has been approached by Bank of the West with an offer to invest in their money market
deposit account. This investment would allow same-day access to cash (up to six withdrawals a
month), a guaranteed return of 35 basis points (0.35% yield), and no fees unless online access was
requested. The savings account would be collateralized 110% by US Government securities.
Staff is proposing to move $2,000,000 from the District's current investment in Local Agency
Investment Fund (0.36% yield as of May 31) to this savings account. The District's investment policy
currently requires Board approval for investments greater than $1 ,000,000 in one institution.
STRATEGIC PLAN:
FR 3-C: Manage Cash Flow to Maximize Investment Income
PRIOR RELEVANT BOARD ACTION(S):
The Board of Directors approved the current investment policy with Resolution No. 11-24 on
December 22, 2011 .
ITEM NO. 2.2
AGENDA REPORT
Meeting Date: June 26, 2012 Budgeted: Yes
Total Budget: $275,297
To: Finance-Accounting Committee Cost Estimate: $275,297
Funding Source: Operating Funds
From: Ken Vecchiarelli, General Account No: 1-2010-0550-00
Manager
Presented By: Stephen Parker, Finance Dept: Finance
Manager
Prepared By: Joann Gitmed, Accounting
Assistant II
Subject: OPEB Liability Pay Down
STAFF RECOMMENDATION:
That the Committee recommend the Board of Directors authorize staff to deposit $275,297
($175,297 Annual Required Contribution plus $100,000 from Employee Liability Reserve) to the
California Employees' Retirement Benefit Trust (CERBT) for FY 2012/13.
DISCUSSION:
The District's budgeted Annual Required Contribution (ARC) for Other Post-Employment Benefits
(OPEB) for FY 12/13 is $175,297. The actuarially anticipated OPEB pay-as-you-go expenses for FY
12/13 are $131 ,922. With the adoption of the current Reserve Policy on June 14, 2012, the District
designated $100,000 to be set aside annually for the Employee Liability Reserve.
For FY 12/13, staff proposes that the District pre-fund the California Employees Retirement Benefit
Trust (CERBT) with the ARC plus the current years' Employee Liability Reserve designation. By
pre-funding the CERBT, the District can submit for reimbursement for actual retiree costs for the
periods of July 2012 through June 2013, but take advantage of the CERBT's superior investment
rate of return in the meantime. Staff is planning to submit those reimbursement requests at the end
of FY 2012/13.
The District's Unfunded Actuarial Accrued Liability (UAAL) for OPEB is approximately $1 ,172,000 as
of June 30, 2012. By paying down the UAAL (which is charged 7.6% annually by actuarial
assumptions) above and beyond the ARC, the District will effectively save $7,600 on future years'
ARC payments. During the past fiscal year, the District's average yield has hovered around 1%.
Funding the CERBT with Employee Liability Reserve money makes prudent financial sense and
complies with the purpose that the reserve was established.
STRATEGIC PLAN:
FR 3-C: Manage Cash Flow to Maximize Investment Income
PRIOR RELEVANT BOARD ACTION(S):
On December 8, 2011 , the Board authorized staff to deposit $255,007 to the California Employees
Retirement Benefit Trust for FY 11/12, to pay down a portion of the District's Other Post
Employment Benefits liability.
On June 14, 2012 the Board approved Resolution No. 12-12 adopting a financial reserves policy
that included an annual funding of $100,000 for an Employees Liability Reserve.
ITEM NO. 2.3
AGENDA REPORT
Meeting Date: June 26, 2012 Budgeted: Yes
Total Budget: $634,127
To: Finance-Accounting Committee Cost Estimate: $612,000
From: Ken Vecchiarelli, General
Manager
Presented By: Stephen Parker, Finance Dept: Finance
Manager
Prepared By: Joann Gitmed, Accounting
Assistant II
Subject: Prepayment of PERS Employer Contribution
STAFF RECOMMENDATION:
That the Committee recommend the Board of Directors authorize staff to prepay the District's
employer portion of CaIPERS' retirement contribution for FY 2012/13.
DISCUSSION:
The District contracts with the California Public Employees' Retirement System (CaIPERS) for
retirement benefits. The District remits an actuarially determined employer contribution each pay
period to CaIPERS. Agencies contracting with CaIPERS have the option of prepaying the employer
contribution at the beginning of each fiscal year in exchange for a reduction in the total annual cost
of the employer contribution.
Per CaIPERS' June 30, 2010 actuarial report, if the District were to prepay the employer
contributions, the expense would drop from $658,431 to $634.310, for a savings of 3.7%, or over
$24,000. Since that actuarial report, the District's salaries have decreased, and more current
information has been requested from CaIPERS.
As the District's current investment yield is under 1%, it would make prudent financial sense to
prepay the District's employer portion of the CaIPERS' retirement contribution for FY 12/13.
STRATEGIC PLAN:
FR 3-C: Manage Cash Flow to Maximize Investment Income
ITEM NO. 2.4
AGENDA REPORT
Meeting Date: June 26, 2012 Budgeted: No
To: Finance-Accounting Committee Cost Estimate: $835,099
Funding Source: Operating Funds
From: Ken Vecchiarelli, General
Manager
Presented By: Stephen Parker, Finance Dept: Finance
Manager
Prepared By: Stephen Parker, Finance
Manager
Subject: Payoff of CaIPERS Side Fund
SUMMARY:
The District has the ability to use reserves to pay down a liability with the California Public
Employees' Retirement System (CaIPERS) that currently incurs an annual expense of 7.75%.
STAFF RECOMMENDATION:
That the Committee recommend the Board of Directors authorize staff to use operating reserves in
the amount of $835,099 to pay off the CaIPERS Side Fund in July 2012.
DISCUSSION:
The District contracts with CaIPERS for retirement benefits. On June 30, 2005 the District was
placed into an agency multiple employer pool by CaIPERS as the District had less than 100
employees. In the process, any agency that was underfunded or overfunded had a side fund
created. This side fund was kept separate from the pool and amortized over 20 years.
The amount the District owes on its side fund as of June 30, 2012 is $836,784, and our current
annual payment is approximately $80,000, which is scheduled to be paid over the next 14 years
(and is subject to decrease or increase based on gains or losses by investments of CaIPERS or
decreases or increases in payroll). The District is assessed an assumed 7.75% interest charge on
the amount owed annually (changing to 7.5% beginning in FY 13/14). At the same time, the District
is receiving a yield of less than 1% of its reserve funds.
If the District were to use Operating Reserves ($4.15 million as of May 2012) to pay down the side
fund, two things would happen. First, the District would yield an effective 7.5% return. Secondly, the
District's Employer Contribution Rate would drop from 11.668 to 10.238% for the upcoming fiscal
year, and future contributions would be lower by 1.43% of salaries for the remaining 13 years that
the side fund payment would have been made. It should be pointed out that as salaries increase in
the future, the 1.43% of salaries paid for the amortization of the side fund would also grow.
Should the Board approve staff's recommendation, operating expenses will decrease by $80,000 for
the upcoming fiscal year, and the District will have $80,000+ of additional cash flow for the next 13
fiscal years that it otherwise would not have had.
STRATEGIC PLAN:
FR 3-C: Manage Cash Flow to Maximize Investment Income
By using reserve balances to pay off a liability incurring an annual expense of 7.75% (and 7.5%
after the upcoming fiscal year), the District will effectively earn 7.75% on an investment of $835,099
for FY 12/13. This reduction of current and future years' expenses is much higher than any interest
income available through an investment that conforms with the California Government Code.
California Public Employees' Retirement System
Actuarial Office
P.O. Box 942709
Sacramento, CA 94229-2709
TTY: (916)795-3240
CaIPERS (888)225-7377 phone• (916)795-2744 fax
t www.calpers.ca.gov
June 25, 2012
CalPERS ID: 2682144221
Employer Name: YORBA LINDA WATER DISTRICT
Rate Plan: MISCELLANEOUS PLAN
Re: Lump Sum Payment to reduce 2012-2013 pooled employer contribution rates
Dear Requestor:
As requested, 2012-2013 employer contribution rate information on your lump sum payment follows.
If you are aware of others interested in this information (i.e. payroll staff,county court employees,
port districts,etc.), please inform them.
The information is based on the most recent annual valuation and assumes payment byJu/y31, 2012and no further
contractual or financing changes taking effect before June 30, 2013. The Side Fund resulting from risk pooling valued
at($836,784) (including any adjustments due to plan amendments, vouchers, golden handshakes, etc.) as of June
30, 2012, will be reduced or eliminated by a lump sum payment in the amount of$835,099. Any later adjustments
due to plan amendments, vouchers, golden handshakes, or financing changes could increase or reestablish a
negative side fund.
We will not be able to say what the 2013-2014 employer contribution rate is until we complete the 2011 valuation in
October.
The change in your 2012/2013 employer contribution rate after you make the proposed lump sum payment is
displayed in the"Change to 2012/2013 Total Employer Rate"line below.
Valuation as of June 30, 2010 Pre-Payment Post-Payment
Projected 6/30/12 Side Fund (SF) ($836,784)
Proposed Lump Sum Pmt by 7/31/12 $835,099
Revised projected 8/01/2012 SF $0
2012-2013 Employer Contribution Rate
Risk Pool's Net Employer Normal Cost 7.720% 7.720%
Risk Pool's Payment on Amortization Bases 1.996% 1.996%
Surcharges for Class 1 Benefits 0.522% 0.522%
Phase out of Normal Cost Difference 0.000% 0.000%
Amortization of Side Fund 1.430% 0.000%
Total Employer Contribution Rate 11.668% 10.238%
Amortization Period 14 years N/A
Change to 12/13 Total Employer Contribution Rate (1.430%)
To initiate this change, the enclosed Lump Sum Payment Request must be completed and returned to the Fiscal
Services Division with a wire transfer or a check by July 31, 2012. A copy should be sent to us.
If you have questions, please call (888) CalPERS (225-7377).
KERRY J. WORGAN, MAAA, FSA, FCIA
Senior Pension Actuary, CalPERS
LUMP SUM PAYMENT REQUEST
Please complete and return this form to the following address:
CalPERS
Fiscal Services Division
Attn: Retirement Program Accounting
P 0 Box 942703
Sacramento,CA 94229-2703
Or fax to: 916-795-7622.
If a wire transfer is being used, it should go to the following account:
ABA#0260-0959-3
Bank of America Sacramento Main
555 Capitol Mall, Suite 1555
Sacramento, CA 95814
For credit to State of CA,CalPERS
Account # 01482-80005
Please e-mail FCSD_public_agency_wires @calpers.ca.gov and your actuary on the day of the wire to
ensure timely crediting to your account. Any individual wire totaling over$5,000,000 requires a 72
hour notice.
Employer Name: YORBA LINDA WATER DISTRICT
CalPERS ID: 2682144221
Member Group or Plan: MISCELLANEOUS PLAN
Rate Plan ID: 1171
Amount: $835,099
Purpose: Pay Off the side fund
Base(s) to which payment is applied: N/A
In recognition of our payment please revise our employer contribution rate effective August 1, 2012:
Name and Title: (Please Print):
Signature: Date:
Mailing Address:
City/State/Zip:
Telephone Number: Fax Number:
E-mail Address:
Fiscal Services verification Date Received Amount Received
PERS01F0036 DMC (02-2009) Reference # Name and Date:
ITEM NO. 3.1
AGENDA REPORT
Meeting Date: June 26, 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: May 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 May 2012. For the month of
May 2012, the District water revenue is trending slightly below expectations.
Water operating revenue is 82.1% of annual budget, which is lower by approximately 6.7% from the
historical trend for the eleven reporting months of the fiscal year. Our 20 by 2020 baseline is 298.1
gallons per capita per day (GPCD), with a target of 238.5. For the current fiscal year through May
2012, our GPCD calculation is 260.1. The 38.0 GPCD reduction from our baseline brings us 60% of
the way to our goal.District salary related expenses are on pace to be below budget by
approximately $1 million at the fiscal year end. This is due to labor that gets charged to Capital
Improvement Projects, lower than anticipated health related expenses and unfilled personnel
positions.
The majority of the Water Fund's individual Supplies and Services expenses are trending below or
near budget, with the exception of Materials which is higher primarily due to unbudgeted
replacement meter purchases.
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 Sewer Funds Supplies and Services expenses are trending below or near budget, with the
exception of Maintenance, which is higher due to the cost of sewer main repairs on Woodcrest, Los
Altos Trail, Yorba Linda Blvd, and at the flood control easement.
ATTACHMENTS:
NamE Description: Type:
May 2012 Combined.xls May 2012 Consolidated Statement Backup Material
May 2012 Water.xlsx May 2012 Water Statement Backup Material
May 2012 Sewer.xls May 2012 Sewer Statement Backup Material
Yorba Linda Water District
Summary Financial Report
Water&Sewer Funds
For Eleven Months Ending May 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 $13,838,622 $4,066,271 77.29%
Water Revenue (Commercial & Fire Det.) 1,726,651 1,669,646 57,005 96.70%
Water Revenue (Landscape/Irrigation) 3,757,058 3,323,664 433,394 88.46%
Water Revenue (Service Charge) 3,406,392 3,088,309 318,083 90.66%
Sewer Charge Revenue 1,548,550 1,416,535 132,015 91.47%
Locke Ranch Assessments 159,862 195,599 (35,737) 122.35%
Other Operating Revenue 754,361 750,418 3,943 99.48%
Total Operating Revenue: 29,257,767 24,282,793 4,974,974 83.00%
Revenue (Non-Operating):
Interest 190,000 242,757 (52,757) 127.77%
Property Tax 1,232,000 1,235,710 (3,710) 100.30%
Other Non-Operating Revenue 499,369 760,792 (261,423) 152.35%
Total Non-Operating Revenue: 1,921,369 2,239,259 (317,890) 116.54%
Total Revenue 31,179,136 26,522,052 4,657,084 85.06%
Expenses (Operating):
Variable Water Costs (G.W., Import& Power) 13,671,538 11,004,073 2,667,465 80.49%
Salary Related Expenses 7,941,306 6,272,959 1,668,347 78.99%
Supplies &Services 4,070,833 3,386,841 683,992 83.20%
Total Operating Expenses 25,683,677 20,663,873 5,019,804 80.46%
Expenses (Non-Operating):
Interest on Long Term Debt 1,906,426 1,728,707 177,719 90.68%
Other Expense 123,193 103,482 19,711 84.00%
Total Non-Operating Expenses: 2,029,619 1,832,189 197,430 90.27%
Total Expenses 27,713,296 22,496,062 5,217,234 81.17%
Net Income(Loss) Before Capital Contributions 3,465,840 4,025,990 (560,150) 116.16%
Contributed Capital - 17,130,412 17,130,412 0.00%
Net Income(Loss) Before Depreciation 3,465,840 21,156,402 24,622,242 610.43%
Depreciation &Amortization 5,561,699 6,038,403 (476,704) 108.57%
Total Net Income (Loss) ($2,095,859) $15,117,999 $25,098,946 -721.33%
Capital- Direct Labor - (348,039) 348,039
Yorba Linda Water District
Water Fund
For Eleven Months Ending May 31, 2012
May 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 $1,280,899 $13,838,622 $4,066,271 77.29%
Water Revenue (Commercial & Fire Det.) 1,726,651 153,417 1,669,646 57,005 96.70%
Water Revenue (Landscape/Irrigation) 3,757,058 273,906 3,323,664 433,394 88.46%
Water Revenue (Service Charge) 3,406,392 281,833 3,088,309 318,083 90.66%
Other Operating Revenue 697,360 24,423 648,549 48,811 93.00%
Total Operating Revenue: 27,492,354 2,014,478 22,568,790 4,923,564 82.09%
Revenue(Non-Operating):
Interest 170,000 30,615 223,138 (53,138) 131.26%
Property Tax 1,232,000 23,535 1,235,710 (3,710) 100.30%
Other Non-Operating Revenue 495,394 23,884 503,290 (7,896) 101.59%
Total Non-Operating Revenue: 1,897,394 78,034 1,962,138 (64,744) 103.41%
Total Revenue 29,389,748 2,092,512 24,530,928 4,858,820 83.47%
Expenses (Operating):
Variable Water Costs (G.W., Import& Power) 13,671,538 1,041,851 11,004,073 2,667,465 80.49%
Salary Related Expenses 6,953,531 486,845 5,496,909 1,456,622 83.39%
Supplies &Services:
Communications 369,303 24,119 167,686 201,617 45.41%
Contractual Services 527,888 30,620 359,190 168,698 68.04%
Data Processing 119,645 1,420 115,117 4,528 96.22%
Dues & Memberships 55,973 553 53,304 2,669 95.23%
Fees &Permits 140,030 3,982 122,685 17,345 87.61%
Insurance 221,526 682 221,802 (276) 100.12%
Materials 361,161 48,999 446,662 (85,501) 123.67%
District Activities, Emp Recognition 20,758 1,049 11,052 9,706 53.24%
Maintenance 418,603 51,915 353,522 65,081 84.45%
Non-Capital Equipment 79,221 11,704 63,787 15,434 80.52%
Office Expense 45,686 5,142 39,167 6,519 85.73%
Professional Services 794,406 119,964 741,500 52,906 93.34%
Training 49,964 1,208 24,926 25,038 49.89%
Travel &Conferences 48,221 1,360 17,383 30,838 36.05%
Uncollectible Accounts 35,340 - 21,833 13,507 61.78%
Utilities 114,855 4,763 58,774 56,081 51.17%
Vehicle Equipment 278,209 42,308 260,624 17,585 93.68%
Supplies &Services Sub-Total 3,680,788 349,788 3,079,014 601,774 83.65%
Total Operating Expenses 24,305,857 1,878,484 19,579,996 4,725,861 80.56%
Expenses (Non-Operating):
Interest on Long Term Debt 1,906,426 155,938 1,728,382 178,044 90.66%
Other Expense 117,193 2,947 87,542 29,651 74.70%
Total Non-Operating Expenses: 2,023,619 158,885 1,815,924 207,695 89.74%
Total Expenses 26,329,476 2,037,369 21,395,920 4,933,556 81.26%
Net Income(Loss) Before Capital Contributions 3,060,272 55,143 3,135,008 (74,736) 102.44%
and Transfers
Transfers(To)/From - - (85,111) (85,111) 0.00%
Capital Contributions - - 16,537 16,537 0.00%
Net Income(Loss) Before Depreciation 3,060,272 55,143 3,066,434 (143,310) 100.20%
Depreciation &Amortization 4,628,999 449,583 4,909,719 (280,720) 106.06%
Total Net Income(Loss) ($1,568,727) ($394,440) ($1,843,285) $137,410 117.50%
Capital- Direct Labor - (28,901) (301,548) 301,548 -
Yorba Linda Water District
Sewer Fund
For Eleven Months Ending May 31,2012
May 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 $128,915 $1,416,535 $132,015 91.47%
Locke Ranch Assessments 159,862 942 195,599 (35,737) 122.35%
Other Operating Revenue 57,001 1,470 101,869 (44,868) 178.71%
Total Operating Revenue: 1,765,413 131,327 1,714,003 51,410 97.09%
Revenue(Non-Operating):
Interest 20,000 1,879 19,619 381 98.10%
Other Non-Operating Revenue 3,975 (2,005) 257,502 (253,527) 6478.04%
Total Non-Operating Revenue: 23,975 (126) 277,121 (253,146) 1155.87%
Total Revenue 1,789,388 131,201 1,991,124 (201,736) 111.27%
Expenses(Operating):
Salary Related Expenses 987,775 65,718 776,050 211,725 81.36%
Supplies&Services:
Communications 27,797 1,777 14,563 13,234 52.39%
Contractual Services 39,733 2,555 28,295 11,438 71.21%
Data Processing 9,006 107 8,664 342 96.21%
Dues&Memberships 4,213 42 4,487 (274) 106.50%
Fees&Permits 10,540 237 7,376 3,164 69.98%
Insurance 16,674 51 16,667 7 99.96%
Materials 27,184 397 20,685 6,499 76.09%
District Activities, Emp Recognition 1,562 79 831 731 53.19%
Maintenance 74,267 4,852 107,117 (32,850) 144.23%
Non-Capital Equipment 18,799 753 13,267 5,532 70.57%
Office Expense 3,439 365 2,927 512 85.12%
Professional Services 59,794 2,375 30,108 29,686 50.35%
Training 3,761 255 4,261 (500) 113.30%
Travel&Conferences 3,630 90 1,241 2,389 34.19%
Uncollectible Accounts 2,660 - 1,162 1,498 43.68%
Utilities 8,645 442 4,878 3,767 56.43%
Vehicle Equipment 78,341 3,810 41,298 37,043 52.72%
Supplies&Services Sub-Total 390,045 18,187 307,827 82,218 78.92%
Total Operating Expenses 1,377,820 83,905 1,083,877 293,943 78.67%
Expenses(Non-Operating):
Interest Expense - - 325 (325) 0.00%
Other Expense 6,000 - 15,940 (9,940) 265.67%
Total Non-Operating Expenses: 6,000 - 16,265 (10,265) 271.08%
Total Expenses 1,383,820 83,905 1,100,142 283,678 79.50%
Net Income(Loss) Before Capital Contributions 405,568 47,296 890,982 (485,414) 219.69%
and Transfers
Transfers(To)/From - - 85,111 85,111
Contributed Capital - 69,100 17,113,875 17,113,875 0.00%
Net Income(Loss) Before Depreciation 405,568 116,396 18,089,968 16,713,572 4460.40%
Depreciation&Amortization 932,700 107,568 1,128,684 (195,984) 121.01%
Total Net Income(Loss) ($527,132) $8,828 $16,961,284 $16,909,556 -3217.66%
Capital-Direct Labor (1,333) (27,589) 27,589
ITEM NO. 3.2
AGENDA REPORT
Meeting Date: June 26, 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 May 31 , 2012
SUMMARY:
Staff is submitting the May 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 reserve categories. The
total yield for the month ending May 2012 decreased to 0.82%. This is the result of the yield change
of investments held in CaITRUST's Medium Term portfolio from 1 .13% to 0.99% as well as a lower
overall balance invested in CaITRUST.
The overall increase in the investment balance from the previous month is approximately $34,000.
An item to note for the month of May is the fund balance in the Maintenance Reserve fund.
Pursuant to the investment policy, the initial funding of this reserve fund was $200,000 from the
Water Capital fund, but it has been drawn down by expenses pertaining to the repair of the Santiago
Pump Station motor.
A couple of the larger balance changes include: an increase in the Reserve for Debt Service fund of
$148,000 due to the District meeting its monthly obligation to ensure that funds are set aside for the
September 2012 debt service principal and interest payment for the 2003 and 2008 COPs; a
decrease of $502,000 in the Water Capital Projects fund for CIP project activity and the funding of
the Maintenance Reserve fund; and an increase of $195,000 in the Water Operating fund.
STRATEGIC PLAN:
FR 3-C: Manage Cash Flow to Maximize Investment Income
ATTACHMENTS:
Name: Description: Type:
Invst Rpt 5-12.xlsx May 2012 Investment Repoi. Backup Material
Invst Agenda Backup - May 2012.xlsx Agenda Backup Backup Material
Yorba Linda Water District
Investment Portfolio Report
May 31, 2012
Market % Percent
Value Cost of Total Institution Yield
Checking Account:
$ 234,834 $ 234,834 Wells Fargo Bank
$ 234,834 $ 234,834 0.91% Total 0.00%
Money Market Accounts:
$ 54,927 $ 54,927 Wells Fargo Money Market 0.05%
17,248 17,248 US Bank(2008 Bond Reserve) 0.04%
$ 72,175 $ 72,175 0.28% Total 0.05%
Federal Home Loan Bank:
$ 2,161,022 $ 2,144,397 US Bank(2008 Bond Reserve) 1.35%
$ 2,161,022 $ 2,144,397 8.38% 1.35%
Pooled Investment Accounts:
$ 4,830,147 $ 4,830,147 Local Agency Investment Fund 0.36%
3,000,094 3,000,093 Ca1TRUST Short Term 0.40%
15,498,628 15,454,056 Ca1TRUST Medium Term 0.99%
$ 23,328,869 $ 23,284,296 90.43% 0.78%
$ 25,796,900 $ 25,735,702 100% Total Investments 0.82%
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
5/31/12
Investment Summary Report
Below is a chart summarizing the yields as well as terms and maturities for the month of May 2012:
Avg. Portfolio Avg. Portfolio #of
Month Yield Without Yield With Days to
of 2012 CalTRUST CalTRUST Maturity
May 0.64% 0.82% 82
Below is are charts comparing operating fund interest for current and prior fiscal years.
Actual Interest 5/31/2011 5/31/2012
Monthly-May $ 23,393 $ 32,494
Year-to-Date $ 205,133 $ 242,756
Budget 2010/2011 2011/2012
Interest Budget, May YTD $ 143,000 $ 174,167
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:
April 2012 %Alloc May 2012 %Alloc
Fund Description Balance 4/30/2012 Balance 5/31/2012
Water Operating Reserve $ 4,029,511 15.74% $ 4,154,546 16.25%
Water Emergency Reserve 1,008,031 3.94% 1,007,968 3.94%
Water Capital Project Reserve 15,405,882 60.18% 14,903,665 58.30%
Water Reserve for Debt Service 587,900 2.30% 735,690 2.88%
Maintenance Reserve 0 0.00% 180,452 0.71%
COP Revenue Bond 2008-Reserve 2,162,651 8.45% 2,161,022 8.45%
COP Revenue Bond 2008 2,699 0.01% 17,248 0.07%
Sewer Operating 272,238 1.06% 221,537 0.87%
Sewer Emergency Reserve 1,007,380 3.94% 1,007,318 3.94%
Sewer Capital Project Reserve 1,121,982 4.38% 1,172,620 4.59%
$ 25,598,274 100.00% $ 25,562,066 100.00%
Wells Fargo Bank Checking
Water Operating 900 71,263
Sewer Operating 163,575 163,571
164,475 234,834
Totals $ 25,762,749 $ 25,796,900
ITEM NO. 3.3
AGENDA REPORT
Meeting Date: June 26, 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.Pdf Strategic Plan Tracking-FA Backup Material
Strategic Plan Initiatives Status Report
Finance-Accounting Committee
Strategies
Lead Party
Comments
Jun 2012 Progress
FR 1: Maintain Fiduciary Res onsibilit
Finance Accounting
Multi-year financial plan provided to the Board during April 11 workshop. A
FR 1-A
Develop a Comprehensive Multi-
Finance
Committee to consider
comprehensive version is included in the FY 2012/13 budget,which was presented
Year Financial Plan
Director
Adding Sewer Model to
to the Board on June 14,2012.
Contract in Jun-11
Revise the Water and Sewer Rules
General
Complete Study in House
Water Rules and Regulations and Fee Schedule was approved by the Board on
FR 1 C
and Regulation and Evaluate Fee
Manager/
and Recommend Fees
March 8,2012. Sewer Rules and Regulations and Fee Schedule will be brought
Schedules Regularly for Proper
Finance
Structure Update for
before the Board in the fall of 2012.
Cost of Service Coverage
Director
Adoption by December 2011
FR 4: Provide a Rate Structure that Promotes Water Use Efficiency
Board of
A recommendation to update the current fixed charge with a volumetric approach
Evaluate Equitable Rate
Board to Consider Rate
was presented to the Board during the April 11 Workshop. The Rate Increase Notice
FR 4-B
Structures that Promote
Directors/
Structure Alternatives in Oct
approved by the Board on April 26 to be mailed to the District's customers reflects
Conservation and Efficiency
General
2011
those proposed changes.The public hearing on those changes occurred on June
Manager
21 2012.
Com leted
Strategies
Lead Party
Comments
Jun 2012 Progress
Prepare a High Level Annual
Budget Document and
FY 2011/12 Budget and CAFR for period ending June 30,2011 received
FR 1-B
Comprehensive Annual Financial
Finance
Include Fees in FY 2011/12
Government Finance Officer's Association awards for excellence. FY 2012/13
Report and Compete for
Director
Budget
Budget goes before the Board for adoption on June 28,2012.
Recognition by the Government
Finance Officers Association
Evaluate and Revise the Sewer
Finance
Revised Allocation included
Completed March 2011. Consider changing allocation methodology in conjunction
FR 1-D
Fund Allocation
Director
in FY 2011/12 Budget
with FY 2013/14 budget process.
Substantial Rate Increase
Maintain Commitment to Strong
Board of
Adopted in Sept 2009
Quarterly review of debt service ratios will continue as well as integrating the ratio
FR 1-E
Debt Services Ratio
Directors
followed by Pass Through
into forward financial projections.
Increase in Aug 2010
Latest Revisions Reviewed by
Review the Reserve Policy and
Finance
Finance-Accounting
Completed review/revision of reserve policy for FY 12/13. Reserve policy adopted
FR 2-A
Director/Board
Committee for Board of
Funding Levels Annually
of Directors
Directors to Consider in Jun-
by the Board on June 14,2012.
1
11
Implement Approach to Ensure
Finance
Rates, Other
Financial model allowed review of reserves on a long-term basis. Staff recommended
FR 2-C
Director/Board
a 3-year rate increase to ensure reserves are responsibly funded. Board voted to
Reserves are
c Responsibly Funded
of Directors
ital Firnanoan cin Oand
Capg ptions
initiate Prop 218 process on April 26. A Public Hearing is scheduled for June 21.
Review Opportunities to Earn
Card Options Discussed with
FR 3-B
"Cash Back"on Operating
Finance
Finance-Accounting
YLWD is online with Cal-CARD.
Expense through Commercial
Director
Committee in March-Add'1
Credit Card Accounts
research Required
Manage Cash Flow to Maximize
Finance
Track Opportunities and
Delia Lugo,Senior Accountant reviews the cash balances and needs daily. Mutliple
FR 3-C
Effectiveness with Quarterly
times a month,excess cash is transferred to investments to earn interest until the
Investment Income
Director
Investment Reports
next check register.
Finance
Board to Consider Rate
The January 16,2012 Board Workshop showed the end product of the cost of service
FR 4-A
Complete the Cost of Service and
Director/Board
Structure Alternatives in Oct
and water rate study. Raftelis Financial Consultants completed a document to
Water Rates Study
of Directors
2011
support the District's Prop 218 notice,which was received and filed by the Board on
April 26.