HomeMy WebLinkAbout2015-09-17 - Board of Directors Meeting Agenda Packet Yorba Linda
Hater District
AGENDA
YORBA LINDA WATER DISTRICT
BOARD OF DIRECTORS SPECIAL MEETING
Thursday, September 17, 2015, 6:30 PM
1717 E Miraloma Ave, Placentia CA 92870
1. CALL TO ORDER
2. PLEDGE OF ALLEGIANCE
3. ROLL CALL
Ric Collett, President
Michael J. Beverage, Vice President
Phil Hawkins
Robert R. Kiley
Gary T. Melton
4. PUBLIC COMMENTS
Any individual wishing to address the Board is requested to identify themselves and state the matter on which
they wish to comment. If the matter is on the agenda, the Board will recognize the individual for their comment
when the item is considered. No action will be taken on matters not listed on the agenda. Comments are limited
to matters of public interest and matters within the jurisdiction of the Water District. Comments are limited to three
minutes.
5. PUBLIC HEARING
5.1. Opening of Hearing by Presiding Officer
5.2. Verification of Notice of Hearing Provided by Board Secretary
5.3. Reports by General Manager, Staff and/or Consultant
5.4. Comments from the Public Speaking In Favor of and/or Against the Issue
5.5. Receipt of Written Communications by the Public
5.6. Closing of Hearing by Presiding Officer
6. RECESS
6.1. Recess and Staff Val idation/Tabulation of Written Protests Received Prior to Closing of
the Public Hearing
7. ACTION CALENDAR
This portion of the agenda is for items where staff presentations and Board discussions are needed prior to
formal Board action.
7.1. Board Discussion and Action Regarding Proposed Water and Sewer Rate Increase
Recommendation. That the Board of Directors. (1) adopt Resolution No. 15-22
Setting Water Rates Effective October 1, 2015 and Rescinding Resolution No. 14-
07; and (2) adopt Resolution No. 15-23 Setting Sewer Rates Effective October 1,
2015 and Rescinding Resolution Nos. 07-13 and 11-17.
8. ADJOURNMENT
8.1. The next Regular Board of Directors Meeting will be held Thursday, September 24, 2015
at 8:30 a.m.
Items Distributed to the Board 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 Board 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. 5.3
AGENDA REPORT
Meeting Date: September 17, 2015
Subject: Reports by General Manager, Staff and/or Consultant
ATTACHMENTS:
Description: Type:
2015 Prop 218 Hearing Presentation.pdf Backup Material Backup Material
2015 YLWD Water and Sewer Rate Study Report.pdf Backup Material Backup Material
0 Yorba Linda
Water District
Independent, Trusted & Reliable Service for More Than 100 Years
�C'� of Directors Special Meeting
Thursday, September 17, 2015
Proposed Water Rate Increase
to the Basic Service Charge
Presented By:
Marc Marcantonio, General Manager
Water o e 31007 :
The rates and charges to be collected by the district
shall be so fixed as to yield an amount sufficient to do
each of the following:
(a) Pay the operating expenses of the district.
(b) Provide for repairs and depreciation of works owned or
operated by the district.
(c) Pay the interest on any bonded debt.
(d) So far as possible, provide a fund for the payment of
the principal of the bonded debt as it becomes due.
It is intended by this section to require the district to pay
the interest and principal of its bonded debt from the
revenues of the district, except that this requirement is
not intended to apply to a bonded debt for sewage
disposal purposes.
Funding Requi'0
rement
Costs are generally funded by
combination of a fixed base fee ,
plus a water usage fee ( per unit fee )
t Base fees are predictable and reliable
f Water usage fees are unpredictable
[ Historically, YLWD ' s cost of providing
service has been covered in large by
the high volume water users
a
I
Business Model
Volumetric Financial model
worked for 106 years
Uniform Rate - More you use, more you
pay
High volume water users allow lower
rates for low volume users
� Basic Service Charge presently covers
only 200 of Operating Costs ( 2012- 15%)
� Decreasing consumption due to stricter
plumbing code, high efficiency
appliances & conservation
L
Plan Prior to Emergency
r.=►- .�1%�; '� ` �.r `.ate q- r 'ti,_ _.4J y --.z ~.--�'�
Conducted 3 Public Workshops (Strategic
Plan , Budget, and Rate Review)
i Met with Citizen ' s Advisory Committee
( CAC )
Determined declining revenue from water
use, coupled with increasing operational
costs due to unfunded mandates, meant
not covering cost of service .
a Gradually ( over 5 years) shift business
model to increase Basic Service Charge
Effects of the Drought
Metropolitan Allocation of 150
4-
-!Ft 4��Cx��mo
on
Base Fee Increase
(40% of Operating Expenses)
Variable $67.50
Charge
Base $16.77
Fee
TOTAL $84.27
$67.50
$67.50
$67.50
$67.50
$67.50
$19.82
$23.29
$27.60
$32.30
$37.79
$87.32 $90.79 $95. 10 $99.80 $105.29
Budget Workshop # 1
FY 2015/16
March 31 , 2015
*Assumes 25 units @$2.70 with a 1 inch Meter
OPP-
Apri* 11 st
25% Conservation
State Water Resources Control Board
m
LI-
Draft Regulation :
35o Conservation Mandate
for YLWD
YLWD Offered Protest
Yorba Linda Yarba Linda
Water District YorUa Lin_ El Water District
4 �
N
y'
5/5/2015
6. Consideration of a proposed Resolubon amending and readopfing drought-related emergency
regulations for • .n water conservabon to implement M Order
� s •
a e safety at risk,but also creates a financial hardship to all our residents to replace
M. Marcantoniu this revenue
4119115
Page 1 We offer a simple solution to this problem that accomplishes the economic and
public health and safety goals of the emergency regulation, and allows YLWD to
1717E Mirakm *mnw Puw continue to build upon our many voluntary short and long term conservation
State Water Resources Control Board
May
Final Regulatio
36 '7o Conservat
Mandate for YL
Challenge # 1 Comply
with State Mandates
Immediately
entered Stage 3
of Conservation
Ordinance
CUT >=
OUTDOOR
WATERING
iN HALF
At stake: fines of $ 10, 000 per day
Steps taken to Achieve Governor
F
a
It
f
Brown ' s Mandate :
GOVERNOR BROWN'S
MANDATE FOR:
Yorba Linda.
Water District
40%
GOAL 10 36% HERS
30%
PIGM. �
��(..'.�1•'- .SRI Ate• PL#��
�r L 1 �4•Y8
fi
� a `,l', !�, ice, �'�,�C► � �
_ _ .-
0%—6.
�,WATER CONSERVE!]
K7
wwW.yiWd.C41"il _ �- ! �
rr _ S
Report Water Waste web and mobile application
Established Conservation Division
Reassigned staff to full-time leak detection
Hosted drought landscape workshops
Conservation goal progress signs
Implemented a Drought Administrative Penalty Structure
as mandated by the State
Lei
Conservat*ion- , .Ach *ieved
4 - .
S,•-�+ - mot' . -Y- r •'7 •lr I
. �
38 % June
43 % July
41 % August
(Cumulative 41 %)
Challenge #2
Avoid Bond Default
Mandates force us to change Business Model
immediately, with virtually no notice to public
Increases to the Basic Service Charge have to
accelerate from 5 years into 1
Hired water rate Financial Consultants ( Raftelis) to
determine cost of service & required rates
40
Bond terms require replacement of lost revenue
(projected >$9M annually) to meet Debt
Covenance
Raftel *ls Proposed Rates
Effective Dates
Monthly Base Fee
5/8
3/4
1
11/2
2
3
4
6
10
Water Use Charge
Proposed Water Rates
.17.7: !#■�i!4•7!TM i 0 F"fit•=i 0 It•TO IPM i 0 VIF41A
7/'-/2015 10/1/2015 7/1/2016 7/1/2017 7/1/2018 7/1/2019
$10.06
$26.29
$29.37
$32.73
$36.39
$40.36
$10.06
$26,29
$2937
$32.73
$36.39
$40.36
$16.77
$41.57
$46.44
$51.76
$57.54
$63.81
$3154
$79.77
$8912
$99.32
$110.41
$122.44
$53.66
$125.61
$140.33
$15639
$173.85
$192.78
$117.37
$270.77
$30149
$337.09
$374.72
$415.53
$211.26
$484.69
$541.46
$603.39
$670.74
$74338
$469.47
$1,225.77
$1,369.34
$1,525.96
$1,696.28
$1,880.98
$1,274.27
$3,212,17
$3,588.39
$3,998.81
$4,44512
$4,929,13
TBD based an actual pass-through water
Uniform Rate $2.70/hcf $2.70/hcf supply casts
Note.Based on the number of customer connections in the District, theproposed Monthly Base
Fee may change slightly.
Effect on the Average Water Bill
I V 9 e_
Basic Service Charge $ 16 . 77
25 Units of Water @ 2 . 70 167 .50
TOTAL
With 36% Conservation . . .
Basic Service Charge
16 Units of Water @ 2 . 70
TOTAL
$84.27 ( Presently)
$41 .57
143 .20
$84.77 ( Proposed )
Effect on the Average Water Bill
3/4 " Inch
Basic Service Charge $ 10.06
25 Units of Water @ 2 .70
TOTAL
With 36% Conservation . . .
Basic Service Charge
16 Units of Water @ 2 . 70
TOTAL
$67 .50
$77.56 ( Presently)
$26 .29
143 .20
$69.,49 ( Proposed )
Board & Employee Pay Facts
1 h !
c `A\ •L - _• .. �^£h �Via—_ '� _ .
Board Last Pay increase 2003
� YLWD losing highly trained , licensed
employees to other water agencies for
higher pay
� Current agreement with Employee
Bargaining Unit came after months of
negotiations, prior to State Mandates
� YLWD Employees netted 4 .5% pay
increases ( Cost of Living Adjustments )
over past 7 years
Pension Reform
� FY 2011 / 12 Board eliminated Retiree
Insurance Benefits for all new hires
i Also reduced their benefit to 2% at age
60 (from 2% at age 55 )
i Required all employees payl 00% of
CaIPERS employee contribution
Prior to Public Employees ' Pension Reform
Act (PEPRA 2013
E Board Members elected after 1994
receive no pension or retirement benefits
Cost Savings
F Negotiated lease agreements for cell towers ($67,468 per year)
Full annexation to OCWD in 2013 to pump more groundwater (a third of
the cost of MWD)
By entering into multi-year labor agreements, the District saves an
estimated $60,000 in legal fees
Negotiated lower cost for water & sewer rate studies saving approx.
$100,000
Presently using District staff in lieu of consultants for various plans,
projects, & reports saving approx. $200,000
i Operations staff designed and built first of its kind, reservoir water-quality
management system, saving over $200,000
In 2015 started Leak-Detection Program saving the District gn,�
customers thousands of dollars
i Presently holding several authorized positions vacant until critical
r Perform mid-year budget review (cost and revenue analysis)
Continue to seek opportunities to share service with other agencies to
reduce costs
Future u o0
I;W 4- F -
� State indicates conservation goals
likely to be " the new normal "
� Emergency Drought Regulations likely
to continue beyond February ' 16 ,
even with a wet winter
� Future revenue and costs are
unpredictable and rates may be
adjusted accordingly
Good Governance
�■ This- -rate increase is directly the result of
unprecedented water cut mandate
from the State , not YLWD
f YLWD has a stellar history of sound
fiscal management
f Just completed Annual Audit with a
clean opinion for 201 4/2015 ( for the
4'" consecutive year)
Good Governance
conti ,�c
Gov . Finance Officers Assoc . ( GFOA)
Cert. of Achievement for Excellence
in Financial Reporting - FY 2010/ 11 , FY
2011 / 12, FY 2012/ 13 , and FY 2013/ 14
t Gov . Finance Officers Assoc .
( GFOA) Distinguished Budget
Presentation Award
- FY
2011 / 12,
FY
2012/ 13, FY 2013 / 14
and
FY
2014/ 15
t CA Certified Municipal Treasurers
Award - FY 201 2/ 13 ( a 4 year
Good Governance
0
con
fi= 7
I CSDA Certifi
Transl2arencx
f The 2014
9
for innovative cost savings ( annexation )
f Soon to be presented : CSDA District of
Distinction Award
t and other awards
Yorba Linda
Water District
Independent, Trusted & Reliable Service for More Than 100 Years
Our Mission
Yorba Linda Water District will provide reliable, high
quality water and sewer services in an
environmentally responsible manner, while maintaining
an economical cost and unparalleled customer
service to our community.
2015 Water and
Sewer Rate Study
Yorba U in da
Water strict RAFTS LIS
D CM
-11111L 11111-11o,111.
PUBLIC HEARING
SEPTEMBER 17 , 2015
] Water Yorba Linda
District
Agenda
1 Current Water Financial Challenges
2 Financial Plan Development
Water
Sewer
Proposed Rates and Customer Impacts
Water
Sewer
] Water Yorba Linda
District
Current Water Financial Challenges
1 Severe Drought in California
36% Conservation Mandate by the State Water
Resource Control Board in May 2015
Water Revenue Instability and Financial
Insufficiency
Revenues from FY 2015 Water
Rates
N $30 $27.18
o $20.79
$20
$10
$0
FY 2015 FY 2016
❑ Base Fees ■ Usage Charges • Total Revenues from Rates
Water Expenses
N $30 $26.87 - $26.69
o $25
$20
$15
$10
$5
$0
FY 2015 FY 2016
0 Fixed Expenses ■Water Costs • Total Expenses
] Water Yorba Linda
District
Financial Plan
Development
WATER
SEWER
] Water Yorba Linda
District
) mmended Financial Policy
Wate;:I"
Reserve Policy
Operations 25% of O&M
Rate Stabilization 15% of Commodity Revenues
Emergency $10M
for major repair of critical assets
Capital 2% of asset value by replacement
Replacement
COP/ Debt
Service
Employee Benefit
Liability (EBL)
costs
100% of annual total debt service
+ $2.147M 2008 COP Restricted
Based on District's projections
� Sewer
25% of O&M
N/A
$3M
for major repair of critical assets
2% of asset value by replacement
costs
100% of annual total debt service
Based on District's projections
Debt Coverage 1.25x for Good standing per S&P 1.25x for Good standing per S&P
rating criteria rating criteria
] Water Yorba Linda
District
Water Financial Plan
Drought Sales in FY 2016 = 13,298 AF (36% of 2013 Sales)
20,000 AF
15,000 AF
15,000 AF
14,000 AF
12,000 AF
10,000 AF
5,000 AF
5,000 AF
4,000 AF
2,000 AF
OAF
Projected Sales
FY 2015 I FY 2016 I FY 2017 I FY 2015 I FY 2019 I FY 2020
J ■ Draught Sales l 18,752 AF I 13,298 AF I 14,551 AF I 15,623 AF I 16,664 AF I 17,706 AF
Status Quo Water Financial Plan
Drought Sales with Pass-through Water Supply Costs
No Revenue Adjustments
Rev Adj 0 Coverage Ratio —Required Coverage-125% • Alert Coverage
Millions Total Water Reserve Ending Balances
W
$30
$20
$10
$0
-$10
-$20
$29
$21
$13
$0
$6
-$12
4
FY 2015 FY 2016 FY 2017 FY 2018 FY 2019 FY 2020
Ending Balances —Minimum • Alert Balances
] Water Yorba Linda
District
Water Revenue Adjustments and
Debt Coverage
➢ Blue bars — No revenue adjustment (left axis)
➢ Red line — Target debt coverage 125%
➢ Dark green line — Projected debt coverage (right
axis)
➢ Red dot — Alert coverage when falling below
target
Projected Reserve Balances
➢ Red bars — Projected ending reserve balances
> Green line — target balances for Water reserves
➢ Red dot — alert balances when ending balances
fall below target levels
Water Revenue Adjustments& Coverage Chart
100.0%
250%
80.0°/a
200%
150%
60.0%
100%
40.0%
43%
27°/n
11%
509'0
20.0%
-22% --- -11°1a
o%
0.0% o. 0.0% o.o� 0.0% 0. %
0.0%n
-50%
FY 2015 FY 2016 FY 2017 FY 2018 FY 2019 FY 2020
Coverage
Rev Adj
Rev Adj 0 Coverage Ratio —Required Coverage-125% • Alert Coverage
Millions Total Water Reserve Ending Balances
W
$30
$20
$10
$0
-$10
-$20
$29
$21
$13
$0
$6
-$12
4
FY 2015 FY 2016 FY 2017 FY 2018 FY 2019 FY 2020
Ending Balances —Minimum • Alert Balances
] Water Yorba Linda
District
Water Revenue Adjustments and
Debt Coverage
➢ Blue bars — No revenue adjustment (left axis)
➢ Red line — Target debt coverage 125%
➢ Dark green line — Projected debt coverage (right
axis)
➢ Red dot — Alert coverage when falling below
target
Projected Reserve Balances
➢ Red bars — Projected ending reserve balances
> Green line — target balances for Water reserves
➢ Red dot — alert balances when ending balances
fall below target levels
Status Quo Water Financial Plan
Drought Sales with Pass-through Water Supply Costs, No Revenue Adjustments
N $40
C
Lo
$z0
$0
-$z0
Water Operating Financial Plan
FY 2015 FY 2016 FY 2017 FY 2018 FY 2019 FY 2020
O Debt Service&LOC Principal
Res Funding
Proposed Rev
O Non-Operating
—Current Rev
Water CIP and Funding Sources
$s
Ln
a $7
$5.79
� $5
$4
t
$3
$Z
$1.39
$1 -
$o
'
FY 2015 FY 2016
■Debt Funded
$6.41
$3.70 $3.65
$3.08
1 11
FY 2017 FY 2018 FY 2019 FY 2020
PAYGO ��Total CIP
] Water Yorba Linda
District
operating Financial Plan
➢ Lines — revenues
➢ Red — current rates with pass-through
WS costs
➢ Green — proposed rates with pass-
through WS costs (no revenue
adjustment 4 same as current rev)
\ ➢ Stacked bars - expenses
Water CIP & Funding Sources
➢ Green bar — PAYGO
➢ Purple bar — New Debt (by Line of Credit
(LOC))
] Water Yorba Linda
District
Status Quo Water Financial Plan
Drought Sales with Pass-through Water Supply Costs, No Revenue Adjustments
Water Revenue Adjustments&Coverage Chart
100.0%
250%
80.0%
$8
$30 x$21
200%
$7
150%
60.0%
$6
$5
$10
100%
40.0%
43% 27%
$4
$0 -$6
°
11/°
$3
50%
20.0%
-22%
-11%
0%
0.0% 0. 0.0% 0.0% 0.0%
0.
$1
0.0%
$0
-50%
FY 2015 FY 2016 FY 2017 FY 2018 FY 2019
FY 2020
Rev Adj
Coverage
IRev Adj Coverage Ratio —Required Coverage-125%
• Alert Coverage
Millions Total Water Reserve Ending Balances
$40
0
$20
-$20
Water Operating Financial Plan
FY 2015 FY 2016 FY 2017 FY 2018 FY 2019 FY 2020
YLWD O&M Water Cost
Debt Service&LOC Principal Non-Operating
Res Funding —Current Rev
—Proposed Rev
$40
$29
$8
$30 x$21
0
$7
$20 $13
$6
$5
$10
$0
$4
$0 -$6
$3
$2
-$10
$1
-$20
$0
FY 2015 FY 2016 FY 2017 FY 2018 FY 2019 FY 2020
Ending Balances —Minimum 0 Alert Balances
$1.39
F
FY 2015
Water CIP and Funding Sources
Selected CIP: Original CIP
$6.41
CS 7Q
$3.65
$3.08
FY 2016 FY 2017 FY 2018 FY 2019 FY 2020
■Debt Funded ■PAYGO A Total CIP
Proposed Water Financial Plan
Drought Sales with Pass-through Water Supply Costs
40.0%
35.0%
30.0%
25.0%
20.0%
15.0%
10.0%
5.0%
0.0%
Water Revenue Adjustments& Coverage Chart
700%
600%
500%
400%
300%
200%
100%
0%
FY 2015 FY 2016 FY 2017 FY 2018 FY 2019 FY 2020 Coverage
Rev Adj
Rev Adj 0 Coverage Ratio —Required Coverage-125% • Alert Coverage
Millions Total Water Reserve Ending Balances
$50
$45
$40
$35
$30
$25
$20
$15
$10
$5
$0
FY 2015 FY 2016 FY 2017 FY 2018 FY 2019 FY 2020
Ending Balances —Minimum • Alert Balances
l
] Water Yorba Linda
District
Water Revenue Adjustments and
Debt Coverage
➢ Blue bars — Proposed revenue adjustments (left
axis) (36% in FY 2016 and 5% in FY 2017 — FY 2019)
➢ Red line — Target debt coverage 125%
➢ Dark green line — Projected debt coverage (right
axis)
➢ Red dot — Alert coverage when falling below
target, if any
Projected Reserve Balances
➢ Red bars — Projected ending reserve balances
> Green line — target balances for Water reserves
➢ Red dot — alert balances when ending balances
fall below target levels
eYorba Linda
Water District
Proposed Water Financial Plan
Drought Sales with Pass-through Water Supply Costs
Cn
Water Operating Financial Plan
N $6D
C
0
$4a
$20
$0
FY 2015 FY 2016 FY 2017 FY 2018 FY 2019 FY 2020
O Debt Service&LOC Principal
Res Funding
Proposed Rev
O Non-Operating
—Current Rev
Water CIP and Funding Sources
$s
Ln
a $7
$5.79
� $5
$4
$3
$2
$1.39
$1
$0
FY 2015 FY 2016
■Debt Funded
$6.41
$3.70 $3.65
$3.08
1 11
FY 2017 FY 2018 FY 2019 FY 2020
PAYGO ��Total CIP
' Operating Financial Plan
➢ Lines — revenues
I ➢ Red — current rates with pass-through
WS costs
➢ Green — proposed rates with pass-
through WS costs
➢ Stacked bars - expenses
Water CIP & Funding Sources
➢ Green bar — PAYGO
➢ Purple bar — New Debt (by Line of Credit
(LOC))
40.0%
35.0%
30.0%
25.0%
20.0%
15.0%
10.0%
5.0%
0.0%
Rev Adj
eYorba Linda
Water District
Proposed Water Financial Plan
Drought Sales with Pass-through Water Supply Costs
Water Revenue Adjustments&Coverage Chart
"' 700%
600%
500%
400%
300%
200%
100%
0%
FY 2020 Coverage
FY 2015 FY 2016 FY 2017 FY 2018 FY 2019
�Kev Hai —L-overage ratio —Kequirea L-overage-1t5io . Hiert L-overage
Millions
$50
$45
$40
$35
$30
$25
$20
$15
$10
$5
$0
Total Water Reserve Ending Balances
FY 2015 FY 2016 FY 2017 FY 2018 FY 2019 FY 2020
iI Ending Balances —Minimum 0 Alert Balances
$60
0
$40
$20
I
Water Operating Financial Plan
FY 2015 FY 2016 FY 2017 FY 2018 FY 2019 FY 2020
YLWD O&M
Debt Service&LOC Principal
Res Funding
—Proposed Rev
Water Cost
C�Non-Operating
Current Rev
Water CIP and Funding Sources
Selected CIP: Original CIP
$8
$6.41
0 $7
$5.79
$6
$5
$4
$3
$1.39
$2
_
$1
r�
$0
FY 2015 FY 2016 FY 2017
■Debt Funded PAYGO
$3.65
$3.08
FY 2018 FY 2019 FY 2020
A Total CIP
Proposed Sewer Financial Plan
10.0%
8.0%
6.0%
4.0%
2.0%
0.0%
Rev Adj
Sewer Revenue Adjustments& Coverage Chart
FY 2016 FY 2017 FY 2018 FY 2019 FY 2020
.allilill Rate Adjustments Debt Coverage
Target Coverage 125% • Alert Coverage
1409'
120
100%
80%
60%
40%
20%
0%
Coverage
] Water Yorba Linda
District
Sewer Revenue Adjustments and
Debt Coverage
➢ Blue bars — Proposed revenue adjustments (left
axis) (8% per year)
➢ Red line — Target debt coverage 125%
➢ Dark green line — Projected debt coverage (right
axis) (No proposed debt)
i
•, $7.0
$6.0
$5.0
$4.0
$3.0
$2.0
$1.0
$0.0
Total Sewer Reserve Ending Balances
FY 2016 FY 2017 FY 2018 FY 2019 FY 2020
Ending Balances Target Balances o Alert Balances
Projected Reserve Balances
➢ Red bars — Projected ending reserve balances
➢ Green line — target balances for Sewer reserves
➢ Red dot — alert balances when ending balances
fall below target levels
] Water Yorba Linda
District
Proposed Sewer Financial Plan
c $3.0
$2.5
$2.0
$1.5
$1.0
$0.5
$0.0
Sewer Operating Financial Plan
FY 2016 FY 2017 FY 2018 FY 2019 FY 2020
�Salary Related Expenses Other Expenses �Debt Service
�Reserve Funding Current Revenues Proposed Revenues
Sewer CIP and Funding Sources
y $0.8
o $0.7
$0.6
$0.5
$0.4
$0.3
$0.2
$0.1
$0.0
FY 2016 FY 2017 FY 2018 FY 2019 FY 2020
■Debt/Loan Funded ■PAYGO •Total CIP
Operating Financial Plan
➢ Lines — revenues
➢ Red — current rates
➢ Green — proposed rates
➢ Stacked bars - expenses
Sewer CIP & Funding Sources
➢ Green bar — PAYGO
➢ Purple bar — New Debt (None)
➢ Blue dot — Total CIP (inflated by CCI)
Proposed Sewer Financial Plan
Sewer Revenue Adjustments &Coverage Chart
10.0%
140%
120%
8.0%
8.0%
100%
6.0%
80%
4.0%
60%
40%
2.0%
20%
0.0%
0%
FY 2016
FY 2017 FY 2018 FY 2019 FY 2020
R Ad'
Coverage
ev �
Rate Adjustments Debt Coverage
Target Coverage 125% • Alert Coverage
Total Sewer Reserve Ending Balances
$7.0
$6.0
$5.0
$4.0 $3.1
$3.0
$2.0
$1.0
$0.0 UN
FY 2016
$3.7
FY 2017
$5.1
FY 2018 FY 2019
FY 2020
$3.0
c
$2.5
$2.0
$1.5
$1.0
$0.5
$0.0
Sewer Operating Financial Plan
hi
if 2016
FY 2018
Salary Related Expenses Other Expenses
Reserve Funding Current Revenues
$0.8 $0.69
o $0.7
$0.6
$0.5
$0.4
$0.3
$0.2
$0.1
$0.0
FY 2016
] Water Yorba Linda
District
FY 2020
� Debt Service
Proposed Revenues
Sewer CIP and Funding Sources
$0.21
-a-
FY 2017
$0.22
•
FY 2018 FY 2019 FY 2020
IIIIIIIIIIIIIIIIIIIIIIIIIIIEncling Balances Target Balances 0 Alert Balances I ■Debt/Loan Funded ■ PAYGO •Total CIP
] Water Yorba Linda
District
Proposed Rates
and Customer
Ire . pacts
WATER
SEWER
Cost of Service Allocation
C,
j
Z
WO-
F
] Water Yorba Linda
District
SUPPLY
DELIVERY
POWER
CAPACITY
BILLING &
CUSTOMER SERVICE
] Water Yorba Linda
District
Water Rate Components
er size H or ivieters tsming & Lzo rapacity rroposea
• $22.92 / mo $26.29 •
3/4
1
11/2
2
3
4
6
8
10
5,617
17,271
573
1,138
6
G
C
C
$3.37/ mo
$22.92 / mo
$26.29 / mo
$3.37/ mo
$38.20 / mo
$41.57 / mo
$3.37/ mo
$76.40 / mo
$79.77 / mo
$3.37/ mo
$122.24 / mo
$125.61 / mo
$3.37/ mo
$267.40 / mo
$270.77 / mo
$3.37/ mo
$3.37/ mo
$3.37/ mo
$3.37/ mo
Water Supply Powei
Usage Rates $1.85 $0.21
$481.32 / mo
$484.69 / mo
$1,222.40 / mo
$1,225.77 / mo
$2,139.20 / mo
$2,142.57 / mo
$3,208.80 / mo
$3,212.17 / mo
Delivery 11
r
Proposed
$0.60
$2.70 / hcf
Proposed Water Rates
5/8
3/4
it
11/2
2
3
4
6
8
10
r
IUsage Rates
$10.06 / mo
$10.06 / mo
$16.77 / mo
$33.54 / mo
$53.66 / mo
$117.37 / mo
$26.29 / mo
$26.29 / mo
$41.57 / mo
$79.77 / mo
$125.61 / mo
$270.77 / mo
$211.26 / mo
$484.69 / mo
$469.47 / mo
$1,225.77 / mo
$804.80 / mo
$2,142.57 / mo
$1,274.27 / mo
$3,212.17 / mo
Proposed ent Usage Rate
$2.70 / hcf
$2.70 / hcf
$16.23
161%
$16.23
161%
$24.80
148%
$46.23
138%
$71.95 134%
$153.40 131%
$273.43 129%
$756.30 161%
$1,337.77 166%
$1,937.90 152%
$0 0%
] Water Yorba Linda
District
19
Water SFR Customer Impacts
$200
180
$160
$140
$120
$100
$80
$60
$40
$20
$0
■ Current
9 Proposed
mpacts
o Impacts
10 hcf
$43.77
$68.57
$24.80
56.7%
Sample SFR Monthly Water Bills
1-inch meter at different usage levels
r
16 hcf
$59.97
$84.77
$24.80
41.4%
25 hcf
$84.27
$109.07
$24.80
29.4%
40 hcf
$124.77
$149.57
$24.80
19.9%
50 hcf
$151.77
$176.57
$24.80
16.3%
] Water Yorba Linda
District
Proposed Sewer Rates
Sewer Fixed
$3.40
Charges
$5.50 7 unit allowance
SFR-District
Flat
SFR-YLC
Flat
MFR-District
Flat
MFR-YLC
Flat
CII-Regular Flat + Vol
CII-YLC Flat + Vol
CII Volumetric
Rates
SEP 17, 2015
] Water Yorba Linda
District
$2.54
$3.40
$5.94
$5.50 7 unit allowance
$2.54
$3.40
$5.94
$5.50 7 unit allowance
$2.18
$3.40
$5.58
$3.85 6 unit allowance
$2.18
$3.40
$5.58
$5.50 6 unit allowance
$2.54
$3.40
$5.94
$5.50 7 unit allowance
$2.54
$3.40
$5.94
Varied by 7 unit allowance
meter size
$0.36 / hcf Estimated return
factor is 83%
SFR Customer Impacts
Water & Sewer Combined Bills
200
$180
$160
$140
$120
$100
$80
60
$40
$20
A,
Sample SFR Monthly later and Sewer Bills
1-inch meter at different usage level
I1
IW
■
] Water Yorba Linda
District
10 hcf
16 hcf
25 hcf
40 hcf
50 hcf
■ Current 1 +S
$49.27
$65.47
$59.77
$130.27
$157.27
— Proposed I +S
$74.51
$90.71
$115.01
$155.51
$152.51
Impacts
$25.24
$25.24
$25.24
$25.24
$25.24
% Impacts
51.2%
55.6%
25.1%
19.4%
16.0%
Proposed 5-Year Water Rates
Increases in District's Fixed Costs 4 Monthly Base Fees
Increases in Water Supply Costs 4 Water Usage Rates
5/8
$10.06
3/4
$10.06
1
$16.77
11/2
$33.54
2
$53.66
3
4
$117.37
$211.26
v
$469.47
8 $804.80
10 $1,274.27
$26.29
$26.29
$41.57
$79.77
$125.61
$270.77
$484.69
$1,225.77
$2,142.57
$3,212.17
$29.37
$29.37
$46.44
$89.12
$140.33
$302.49
$541.46
$1,369.34
$32.73
$32.73
$51.76
$99.32
$156.39
$337.09
$603.39
$36.39
$36.39
] Water Yorba Linda
District
$40.36
$40.36
$57.54
$63.81
$110.41
$122.44
$173.85
$192.78
$374.72
$415.53
$670.74
$743.78
$1,525.96 $1,696.28
$2,393.52 $2,667.28
$3,588.39 $3,998.81
$2,964.98
$4,445.12
$1,880.98
$3,287.83
$4,929.13
Usage $2.70 / hcf $2.70/ hcf $2.70/ hcf $2.70 / hcf
Rate* $2.70 / hcf $2.70/ hcf +TBD Pass-through +TBD Pass-through +TBD Pass-through +TBD Pass-through
*Pass-through Water Supply Costs will be calculated annually based on actual increases on unit water supply costs incurred by the District
] Water Yorba Linda
District
Proposed 5 -Year Sewer Rates
Sewer Fixed Charges
($/month/Dwelling Unit)
SFR-District
$5.50
SFR-YLC
$5.50
MFR-District
$3.85
MFR-YLC
$5.50
CII-Regular
$5.50
CII-YLC
CII Volumetric Rates
CII-Regular
CII-YLC
Varied by
meter size
$5.94
$5.94
$5.58
$5.58
$5.94
$6.42
$6.42
$6.03
$6.03
$6.94
$6.94
$6.52
$6.52
$6.42 $6.94
$5.94 $6.42
$0.46 / hcf $0.36 / hcf $0.40/hcf
$0.176 / hcf $0.36 / hcf $0.40/hcf
$7.50
$7.50
$7.05
$7.05
$7.50
$6.94 $7.50
$8.10
$8.10
$7.62
$7.62
$8.10
$8.10
$0.44/hcf $0.48/hcf $0.52/hcf
$0.44/hcf $0.48/hcf $0.52/hcf
7 unit allowance
7 unit allowance
6 unit allowance
6 unit allowance
7 unit allowance
7 unit allowance
Sewer Return Factor=83% 1
Above 7 unit allowance
Above 7 unit allowance
ITEM NO. 7.1
AGENDA REPORT
Meeting Date: September 17, 2015
To: Board of Directors
From: Marc Marcantonio, General
Manager
Presented By: Marc Marcantonio, General
Manager
Prepared By: Delia Lugo, Finance Manager
Subject: Board Discussion and Action Regarding Proposed Water and Sewer Rate
Increase
SUMMARY:
Over the course of preparing the FY 2015/16 Operating Budget and assessing the direct negative
financial impact the District would be facing due to the SWRCB's mandate to reduce District-wide
consumption by 36%, the Yorba Linda Water District entered into a Professional Services
Agreement with Raftelis Financial Consultants, Inc. to perform a Water and Sewer Rate Study. The
objective of this study was to meet the following:
• Develop financial plans for the water and sewer enterprises to ensure financial
sufficiency including the establishment of adequate reserve balances, meeting the annual
operation and maintenance costs, and ensuring sufficient funding for capital refurbishment
and replacement needs.
• Conduct a cost-of-service analysis for the water and sewer services.
• Develop fair and equitable 5-year water and sewer rates and charges to enhance revenue
stability for recovering fixed costs while in compliance with Proposition 218.
STAFF RECOMMENDATION:
That the Board of Directors: (1) adopt Resolution No. 15-22 Setting Water Rates Effective October
1, 2015 and Rescinding Resolution No. 14-07; and (2) adopt Resolution No. 15-23 Setting Sewer
Rates Effective October 1, 2015 and Rescinding Resolution Nos. 07-13 and 11-17.
DISCUSSION:
At the July 9, 2015 Board meeting, Raftelis Financial Consultants, Inc. presented the results of the
2015 Water and Sewer Rate Study. The resulting financial and statistical data indicated that without
an increase in water and sewer rates and charges, the District would not be able to cover its cost-of-
service. In addition, the District would be in immediate in danger of not meeting its required Debt
Service Coverage Ratio of 110% for the water fund. The District is required to collect rates and
charges for the water distribution service made available or provided by the water system which will
be at least sufficient to yield, during each fiscal year, net revenues equal to at least 110% of the
Debt Service for such fiscal year.
In addition to the study, the 2015 Water and Sewer Rate Study Report summarizes the key findings
and recommendations related to the development of the financial plans for the water and sewer
utilities and the development of associated water and sewer rates and charges that are equitable
and in compliance with Proposition 218.
Staff has prepared Resolution Nos. 15-22 and 15-23, where upon adoption will implement the
proposed water and sewer rate increases as of October 1, 2015.
STRATEGIC PLAN:
FR 2-C: Implement an Approach to Ensure Reserves are Responsibly Funded
PRIOR RELEVANT BOARD ACTION(S):
At the Special Board meeting held on July 16, 2015, the Board received and filed the 2015 Water
and Sewer Rate Study, prepared by Raftelis Financial Consultants, Inc., that provided the statistical
and financial data in support of the proposed water and sewer rate increases.
On August 31, 2015, the Board received and filed the 2015 Water and Sewer Rate Study
Report that summarizes the key findings and recommendations related to the development of the
financial plans for the water and sewer utilities and the development of associated water and sewer
rates and charges that are equitable and in compliance with Proposition 218.
ATTACHMENTS:
Name: Description: Type:
Resolution No. 15-22 Setting Water Rates.docx Resolution Resolution
Resolution No. 15-23 Setting Sewer Rates.docx Resolution Resolution
Approved by the Board of Directors of the
Yorba Linda Water District
9/17/2015
RC/MB 5-0 Roll Call
RESOLUTION NO. 15-22
RESOLUTION OF THE BOARD OF DIRECTORS
OF THE YORBA LINDA WATER DISTRICT
SETTING WATER RATES EFFECTIVE OCTOBER 1, 2015
AND RESCINDING RESOLUTION NO. 14-07
WHEREAS, pursuant to Water Code Section 31007, the Board of Directors of the
Yorba Linda Water District (YLWD) is required to set water rates at a level
which will pay for the provision of water services; and
WHEREAS, pursuant to Government Code Section 53756, YLWD may adopt a
schedule of fees or charges authorizing automatic adjustments that pass
through increases in wholesale charges for water; and
WHEREAS, the Board of Directors previously adopted Resolution No. 14-07, which
established water rates effective July 1, 2014; and
WHEREAS, on July 16, 2015 the Board of Directors considered the 2015 Water and
Sewer Rate Study, and on August 31, 2015 the 2015 Water and Sewer
Rate Study Report; and
WHEREAS, the Board of Directors determined that the water rate increases described
in the 2015 Water and Sewer Rate Study Report are necessary and
sufficient to cover, without exceeding, the cost to provide water service to
each customer connection; and
WHEREAS, pursuant to and in compliance with Proposition 218 (California
Constitution Art. X111 D), the District on July 31, 2015 mailed a notice of
water rate increase to all property owners within the District's service area
which included the proposed rates for FY 2015/16, FY 2016/17, FY
2017/187 FY 2018/19, and FY 2019/20, and the Board of Directors has
received a proof of mailing; and
WHEREAS, pursuant to Proposition 218 on September 17, 2015 the Board of Directors
held a hearing regarding water rates and pass-through charges for FY
2015/167 FY 2016/17, FY 2017/18, FY 2018/19, and FY 2019/20 and
heard and considered protests; and
WHEREAS, the Board of Directors desires to establish water rates for the remainder of
FY 2015/16.
Resolution No. 15-22 Setting Water Rates Effective October 1, 2015 and Rescinding Resolution No. 14-07 1
NOW, THEREFORE, BE IT RESOLVED that the Board of Directors of the Yorba Linda
Water District does hereby find, determine, and resolve the following:
Section 1. Resolution No. 14-07 is hereby rescinded.
Section 2. Written protests against the proposed rates and charges were not
presented by a majority of owners as set forth in California
Constitution Art. XIII D Section 6(a)(2).
Section 3. The Board of Directors has reviewed the entire record for this
matter, which includes the 2015 Water and Sewer Rate Study
Report and the analysis of expenses and revenues set forth
therein. Based upon the Board of Directors' review, it finds and
determines that the record supports the Board of Directors' findings
that:
A. As set forth in the 2015 Water and Sewer Rate Study
Report, revenues derived from the rates and charges will not
exceed the revenues required to provide the property related
service; and
B. As set forth in the 2015 Water and Sewer Rate Study
Report, revenues derived from the rates and charges will not
be used for any purpose other than that for which the rates
or charges are imposed; and
C. As set forth in the 2015 Water and Sewer Rate Study
Report, the amount of a rate or charge imposed upon any
parcel or person as an incident of property ownership does
not exceed the proportional cost of the service attributable to
the parcel.
Section 4. The Board of Directors hereby determines that no rate or charge
will be imposed for a service unless that service is actually used by,
or immediately available to, the owner of the property in question.
Resolution No. 15-22 Setting Water Rates Effective October 1, 2015 and Rescinding Resolution No. 14-07 2
Section 5. The Board of Directors hereby determines that no rate or charge
will be imposed for general governmental services including, but
not limited to, police, fire, ambulance or library services, where the
service is available to the public at large in substantially the same
manner as it is to property owners.
Section 6. Water rates and customer connection charges for service defined in
Section 3.4 of the Rules and Regulations With Regard to the
Rendition of Water Service of the Yorba Linda Water District are
hereby set forth as follows and will take effect on customer billings
with the "Bill Date" on or after October 1, 2015:
For All Potable Water Service:
All Water Usage shall be charged at $2.70 / 100 Cu. Ft.
(Does Not Include
Pass-through Charge)
Monthly Service Charge for:
5/8" and 3/4" Meters $ 26.29
1" Meters $ 41.57
1 1/2" Meters $ 79.77
2" Meters $ 125.61
3" Meters $ 270.77
4" Meters $ 484.69
6" Meters $1,225.77
8" Meters $2,142.57
10" Meters $3,212.17
Section 7. Additional rates and fees for service are as follows:
A. The charge for Permanent Untreated Water Service as defined
in Section 3.4.3 of the Rules and Regulations for Water Service
shall be as follows:
The current Metropolitan Water District of Southern California
(MWD) Untreated Full rate, plus charges by the Municipal Water
District of Orange County (MWDOC), plus any other fees,
charges or penalties as may be imposed by MWD and/or
MWDOC, plus $13 per acre foot.
Resolution No. 15-22 Setting Water Rates Effective October 1, 2015 and Rescinding Resolution No. 14-07 3
B. The charge for Temporary Service as defined in Section 3.5.1 of
the Rules and Regulations for Water Service shall be as follows:
The rate per hundred cubic feet shall be two times the rate
specified for all water service plus $2.50 per day for each day
that the meter is available for use by the customer. A security
deposit of $1,000 is required at the time of rental and the
deposit will be returned within 15 days of the return of the meter.
C. The charge for Private Fire Service as defined in Section 3.6 of
the Rules and Regulations for Water Service shall be as follows:
Meter Size Monthly Charge
4" $16.00
6" $35.00
8" $59.00
10" $94.00
PASSED AND ADOPTED this 17th day of September 2015, by the following called vote:
AYES:
NOES:
ABSTAIN:
ABSENT:
Ric Collett, President
Yorba Linda Water District
ATTEST:
Marc Marcantonio, Board Secretary
Yorba Linda Water District
Resolution No. 15-22 Setting Water Rates Effective October 1, 2015 and Rescinding Resolution No. 14-07 4
Reviewed as to form by General Counsel:
Arthur G. Kidman, Esq.
Kidman Law LLP
Resolution No. 15-22 Setting Water Rates Effective October 1, 2015 and Rescinding Resolution No. 14-07 5
RESOLUTION NO. 15-23
RESOLUTION OF THE BOARD OF DIRECTORS
OF THE YORBA LINDA WATER DISTRICT
SETTING SEWER RATES EFFECTIVE OCTOBER 1, 2015
AND RESCINDING RESOLUTION NOS. 07-13 AND 11-17
WHEREAS, pursuant to Water Code Section 31007, the Board of Directors of the
Yorba Linda Water District (YLWD) is required to set sewer rates at a level
which will pay for the provision of sewer services; and
WHEREAS, the Board of Directors previously adopted Resolution No. 07-13, which
established sewer rates effective September 1, 2007; and
WHEREAS, the Board of Directors previously adopted Resolution No. 11-17,
establishing sewer rates applicable to certain to accounts transferred from
the City of Yorba Linda effective July 1, 2011; and
WHEREAS, on July 16, 2015, the Board of Directors considered the 2015 Water and
Sewer Rate Study, and on August 31, 2015 the 2015 Water and Sewer
Rate Study Report; and
WHEREAS, the Board of Directors determined that the sewer rate increases described
in the 2015 Water and Sewer Rate Study Report are necessary and
sufficient to cover, without exceeding, the cost to provide sewer service to
each customer connection; and
WHEREAS, pursuant to and in compliance with Proposition 218 (California
Constitution Art. X111 D), the District on July 31, 2015 mailed a notice of
sewer rate increase to all property owners within the District's service area
which included the proposed rates for FY 2015/16, FY 2016/17, FY
2017/187 FY 2018/19, and FY 2019/20, and the Board of Directors has
received a proof of mailing; and
WHEREAS, pursuant to Proposition 218 on September 17, 2015 the Board of Directors
held a hearing regarding sewer rates for FY 2015/16, FY 2016/17, FY
2017/187 FY 2018/19, and FY 2019/20 and heard and considered
protests; and
WHEREAS, the Board of Directors desires to establish sewer rates for the remainder
of FY 2015/16.
Resolution No. 15-23 Setting Sewer Rates Effective October 1, 2015 and Rescinding Resolution Nos.07-13 and 11-17 1
NOW, THEREFORE, BE IT RESOLVED that the Board of Directors of the Yorba Linda
Water District does hereby find, determine, and resolve the following:
Section 1. Resolution Nos. 07-13 and 11-17 are hereby rescinded.
Section 2. Written protests against the proposed rates and charges were not
presented by a majority of owners as set forth in California
Constitution Art. XIII D Section 6(a)(2).
Section 3. The Board of Directors has reviewed the entire record for this
matter, which includes the 2015 Water and Sewer Rate Study
Report and the analysis of expenses and revenues set forth
therein. Based upon the Board of Directors' review, it finds and
determines that the record supports the Board of Directors' findings
that:
A. As set forth in the 2015 Water and Sewer Rate Study
Report, revenues derived from the rates and charges will
not exceed the revenues required to provide the property
related service; and
B. As set forth in the 2015 Water and Sewer Rate Study
Report, revenues derived from the rates and charges will
not be used for any purpose other than that for which the
rates or charges are imposed; and
C. As set forth in the 2015 Water and Sewer Rate Study
Report, the amount of a rate or charge imposed upon any
parcel or person as an incident of property ownership
does not exceed the proportional cost of the service
attributable to the parcel.
Section 4. The Board of Directors hereby determines that no rate or charge
will be imposed for a service unless that service is actually used by,
or immediately available to, the owner of the property in question.
Section 5. The Board of Directors hereby determines that no rate or charge
will be imposed for general governmental services including, but
not limited to, police, fire, ambulance or library services, where the
service is available to the public at large in substantially the same
manner as it is to property owners.
Resolution No. 15-23 Setting Sewer Rates Effective October 1, 2015 and Rescinding Resolution Nos.07-13 and 11-17 2
Section 6. Sewer rates and customer connection charges for service defined
in Sections 15.01 and 15.02 of the Rules and Regulations With
Regard to the Rendition of Sanitary Sewer Service of the Yorba
Linda Water District are hereby set forth as follows, to take effect
on October 1, 2015:
A. Residential:
1. Residential - individually metered $5.94 per month
2. Residential - master metered $5.58 per month per unit
B. Commercial-Industrial and Public Schools:
1. For all sewer customers in this category who use meter
readings, the rate is as follows:
a. First 700 cubic feet per month of water
consumption per month: $5.94 per month.
b. All water consumption in excess of 701 cubic feet
per month: $3.60 per 1,000 cubic feet.
2. Alternatively, for customers who have a sewer meter or
who can demonstrate to the District's satisfaction that
100% of the water meter reading ends up in the District's
sewer system, the rate is as follows:
a. First 1,100 cubic feet per month: $5.94 per month
b. All metered use in excess of 1,101 cubic feet per
month at $5.06 per 1,000 cubic feet.
Resolution No. 15-23 Setting Sewer Rates Effective October 1, 2015 and Rescinding Resolution Nos.07-13 and 11-17 3
PASSED AND ADOPTED this 17th day of September 2015, by the following called vote:
AYES:
NOES:
ABSTAIN:
ABSENT:
Ric Collett, President
Yorba Linda Water District
ATTEST:
Marc Marcantonio, Board Secretary
Yorba Linda Water District
Reviewed as to form by General Counsel:
Arthur G. Kidman, Esq.
Kidman Law LLP
Resolution No. 15-23 Setting Sewer Rates Effective October 1, 2015 and Rescinding Resolution Nos.07-13 and 11-17 4