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Home My WebLink About2015-07-09 - Board of Directors Meeting Agenda Packet AGENDA YORBA LINDA WATER DISTRICT BOARD OF DIRECTORS REGULAR MEETING Thursday, July 9, 2015, 8:30 AM 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. ADDITIONS/DELETIONS TO THE AGENDA 5. 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. 6. COMMITTEE REPORTS 6.1. Citizens Advisory Committee (Collett) · Minutes of the meeting held June 22, 2015 at 8:30 a.m. · Next meeting will be held July 27, 2015 at 8:30 a.m. 7. CONSENT CALENDAR All items listed on the consent calendar are considered to be routine matters, status reports, or documents covering previous Board instructions. The items listed on the consent calendar may be enacted by one motion. There will be no discussion on the items unless a member of the Board, staff, or public requests further consideration. 7.1. Minutes of the Board of Directors Regular Meeting held June 11, 2015 Recommendation: That the Board of Directors approve the minutes as presented. 7.2. Minutes of the Board of Directors Workshop Meeting held June 18, 2015 Recommendation: That the Board of Directors approve the minutes as presented. 7.3. Minutes of the Board of Directors Special Meeting held June 18, 2015 Recommendation: That the Board of Directors approve the minutes as presented. 7.4. Minutes of the Board of Directors Regular Meeting held June 25, 2015 Recommendation: That the Board of Directors approve the minutes as presented. 7.5. Payments of Bills, Refunds, and Wire Transfers Recommendation: That the Board of Directors ratify and authorize disbursements in the amount of $476,386.82. 8. ACTION CALENDAR This portion of the agenda is for items where staff presentations and Board discussions are needed prior to formal Board action. 8.1. Proposed Budget for FY 2015/16 Recommendation: That the Board of Directors approve Resolution No. 15-16 Adopting the Budget for Fiscal Year 2015/16 and Rescinding Resolution No. 14-08. 8.2. Water Conservation Participation Agreement with Municipal Water District of Orange County (MWDOC) Recommendation: That the Board of Directors authorize the General Manager to execute MWDOC's Water Conservation Participation Agreement. 8.3. Nominations for Association of California Water Agencies (ACWA) President and Vice President Recommendation: That the Board of Directors consider nominations for ACWA President and Vice President. 8.4. California Special Districts Association (CSDA) 2015 Board Elections Recommendation: That the Board of Directors consider voting for one of the nominated candidates in the CSDA 2015 Board Election. 8.5. Proposed Amended and Restated Independent Special Districts of Orange County (ISDOC) Bylaws Recommendation: That the Board of Directors consider approving the amended and restated ISDOC bylaws. 9. DISCUSSION ITEMS This portion of the agenda is for matters that cannot reasonably be expected to be concluded by action of the Board of Directors at the meeting, such as technical presentations, drafts of proposed policies, or similar items for which staff is seeking the advice and counsel of the Board of Directors. Time permitting, it is generally in the District’s interest to discuss these more complex matters at one meeting and consider formal action at another meeting. This portion of the agenda may also include items for information only. 9.1. Water and Wastewater Rate Study Review 10. REPORTS, INFORMATION ITEMS, AND COMMENTS 10.1. President's Report 10.2. Directors' Reports · Groundwater Replenishment System Initial Expansion - June 26, 2015 10.3. General Manager's Report 10.4. General Counsel's Report 10.5. Future Agenda Items and Staff Tasks 11. COMMITTEE REPORTS CONTINUED 11.1. Interagency Committee with MWDOC and OCWD (Collett / Melton) · Next meeting will be held July 28, 2015 at 4:00 p.m. 11.2. Joint Agency Committee with City of Placentia (Melton / Kiley) · Minutes of the meeting held June 22, 2015 at 2:00 p.m. (To be provided at the next regular Board meeting.) · Next meeting will be held July 27, 2015 at 2:00 p.m. at Golden State Water Company's office in Placentia. 11.3. Joint Agency Committee with City of Yorba Linda (Collett / Beverage) · Minutes of the meeting held June 23, 2015 at 10:00 a.m. (To be provided at the next regular Board meeting.) · Next meeting will be held July 22, 2015 at 10:00 a.m. at YL City Hall. 12. INTERGOVERNMENTAL MEETINGS 12.1. MWDOC Board - July 1, 2015 (Melton) 12.2. OCSD Operations Committee - July 1, 2015 (Kiley/Beverage) 12.3. OCWD Board - July 1, 2015 (Collett) 12.4. Placentia City Council - July 7, 2015 (Melton) 13. BOARD OF DIRECTORS ACTIVITY CALENDAR 13.1. Meetings from July 10, 2015 - August 31, 2015 14. ADJOURNMENT 14.1. A Board of Directors Special Meeting has been scheduled for Thursday, July 16, 2015 at 8:30 a.m. The next Regular Board of Directors Meeting will be held Thursday, July 23, 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. 6.1 AGENDA REPORT Meeting Date: July 9, 2015 Subject:Citizens Advisory Committee (Collett) · Minutes of the meeting held June 22, 2015 at 8:30 a.m. · Next meeting will be held July 27, 2015 at 8:30 a.m. ATTACHMENTS: Name:Description:Type: 062215_-_CAC_Minutes.docx Minutes Minutes 1 MINUTES OF THE YORBA LINDA WATER DISTRICT CITIZENS ADVISORY COMMITTEE MEETING Monday, June 22, 2015, 8:30 a.m. 1717 E Miraloma Ave, Placentia CA 92870 1. CALL TO ORDER The June 22, 2015 meeting of the Yorba Linda Water District’s Citizens Advisory Committee was called to order by Chair Daniel Mole at 8:30 a.m. The meeting was held in the Training Room at the District’s Administration Building located at 1717 East Miraloma Avenue, Placentia, California 92870. 2. ROLL CALL COMMITTEE MEMBERS PRESENT Daniel Mole, Chair Rick Buck, Vice Chair Fred Hebein Lindon Baker Carl Boznanski Modesto Llanos Oscar Bugarini, Sr. YLWD DIRECTORS PRESENT YLWD STAFF PRESENT Ric Collett, President Marc Marcantonio, General Manager Damon Micalizzi, Public Information Manager Cindy Botts, Management Analyst Malissa Tem, Public Affairs Specialist ALSO PRESENT Brett Barbre, Director, MWDSC and MWDOC 3. PUBLIC COMMENTS None. 4. DISCUSSION ITEMS 4.1. Recap of Water Use Restrictions and Imposition of Drought Penalties to Comply with State of California Mandate The Committee had an extensive discussion about the District’s implementation of Drought Administrative Penalties. Key issues included: Some CAC members were concerned that the penalties were not discussed or presented to the CAC prior to implementation. The CAC has already gone on the record supporting the District’s intentions to shift its business model to one that focuses more on water service and grows the District’s reserves. Staff explained that due to the many fast moving targets and mandates set by the State Water Resources Control Board, there simply wasn’t enough time. President Collett reported to the Committee that the Board of 2 Directors would normally hold a workshop for an important item like this, however due to time restrictions the Penalty Ordinance was drafted by staff with the advice of the District’s legal counsel in the waning hours of the workweek and into the weekend, just to meet the posting deadline. Questions were raised as to what the Administrative Penalties would fund and where would additional dollars leftover go. Staff reported that the Penalties would fund four part time water conservation representatives, additional customer correspondence and communications initiatives dedicated to achieving the State Mandates and to any fines levied by the State to the District, should the District not achieve the 36% target. There are also too many unknowns to forecast “leftover dollars” as staff does not believe that the Administrative Penalties will cover the full brunt of the State’s fines if the District falls out of compliance and does not recover. Still though, that forecast is based on assumptions that some conservation does take place. President Collet reasoned that if conservation exceeds expectations, the District will likely not be fined by the State and fewer penalties will be collected. Should there be monies accumulated from the Administrative Penalties that are not spent on the aforementioned items related to the Emergency Ordinance, the Board of Directors would decide where to allocate the funds. The Penalty Blocks were discussed with inquiries as to why lot size was not considered when the blocks were set. Staff explained that these Administrative Penalties are not intended to be permanent and are only to be employed for the duration the Governor’s Executive Order, which deems irrigation of outdoor ornamental grass a waste of potable water. By that rationale, and because these Penalties are tied to the State’s rules, the District set blocks that would elevate with greater outdoor use, while not penalizing those who do not use water outdoors. It was posed to Staff that any customer, residential, commercial or irrigation could reduce their consumption by 36% or more and still be penalized. Staff admitted that to be the case, however reiterated that the Executive Order specifically targets grass and that this is a State of Emergency, drawing a parallel to a major earthquake. During this Emergency period, we must comply and it is forcing the District into some very awkward positions with our rate payers as we adhere to the State’s rules. Staff admitted that the Penalty Ordinance isn’t perfect, yet given the tight deadline and the many extraordinary circumstances the District faces, it was the best that could be done, in short order. 3 4.2. Metropolitan Water Supply Update Director Barbre, who offered several points and insights during the previous item offered a report on Metropolitan’s Water Supply to the Committee, reaffirming Met’s 15% Allocation as the appropriate conservation target for the region. 4.3. Draft FY 2015/16 Operating Budget (Materials to be provided at the meeting.) Due to time, this item was continued to the next meeting. 4.4. President's Report President Collett’s report was included in the previous items. 4.5. Future Agenda Items None. 5. ADJOURNMENT 5.1. The meeting was adjourned at 10:45 a.m. The next Citizens Advisory Committee meeting is scheduled to be held Monday, July 27, 2015 at 8:30 a.m. DM ITEM NO. 7.1 AGENDA REPORT Meeting Date: July 9, 2015 Subject:Minutes of the Board of Directors Regular Meeting held June 11, 2015 STAFF RECOMMENDATION: That the Board of Directors approve the minutes as presented. ATTACHMENTS: Name:Description:Type: 2015-06-11_-_BOD_-_Minutes.doc Minutes Minutes Approved by the Board of Directors of the Yorba Linda Water District 7/9/2015 MB/GM 5-0 1 MINUTES OF THE YORBA LINDA WATER DISTRICT BOARD OF DIRECTORS REGULAR MEETING Thursday, June 11, 2015, 8:30 a.m. 1717 E Miraloma Ave, Placentia CA 92870 1. CALL TO ORDER The June 11, 2015 Regular Meeting of the Yorba Linda Water District Board of Directors was called to order by President Collett at 8:30 a.m. The meeting was held in the Board Room at the District’s Administration Building located at 1717 East Miraloma Avenue in Placentia, California 92870. 2. PLEDGE OF ALLEGIANCE President Collett led the pledge. 3. ROLL CALL DIRECTORS PRESENT STAFF PRESENT Ric Collett, President Marc Marcantonio, General Manager Michael J. Beverage, Vice President Steve Conklin, Engineering Manager Robert R. Kiley Ken Mendum, Water Maintenance Superintendent Phil Hawkins Gina Knight, Human Resources/Risk Manager Gary T. Melton Delia Lugo, Finance Manager Damon Micalizzi, Public Information Manager Annie Alexander, Executive Secretary Alex Thomas, Water Quality Engineer ALSO PRESENT Brett Barbre, Director, MWDSC and MWDOC Eddy Beltran, Partner, Kidman Law LLP Tom Lindsey, Mayor Pro Tem, City of Yorba Linda Christy Parker, Resident Nancy Stevens, Resident 4. ADDITIONS/DELETIONS TO THE AGENDA None. 5. PUBLIC COMMENTS Mr. Brett Barbre, Director for MWDSC and MWDOC, addressed the Board and reported on the status of available funding for MWDOC’s turf removal rebate program and the Governor’s attendance at a recent MWDSC Board meeting. Christy Parker, resident, addressed the Board and distributed a handout containing her ideas regarding positively empowering and incentivizing District customers to save water. She also provided suggestions for the District’s website, billing statement, meter reading schedule and billing periods. 2 Ms. Nancy Stevens, resident, addressed the Board and commented on her recent water consumption history. She also asked for clarification regarding potential drought penalties for a park with only one water meter. Director Beverage responded. 6. CONSENT CALENDAR Director Beverage made a motion, seconded by Director Hawkins, to approve the Consent Calendar. Motion carried 5-0. 6.1. Minutes of the Board of Directors Regular Meeting held April 9, 2015 Recommendation: That the Board of Directors approve the minutes as presented. 6.2. Minutes of the Board of Directors Special Meeting held April 14, 2015 Recommendation: That the Board of Directors approve the minutes as presented. 6.3. Minutes of the Board of Directors Regular Meeting held April 23, 2015 Recommendation: That the Board of Directors approve the minutes as presented. 6.4. Minutes of the Board of Directors Special Meeting held April 30, 2015 Recommendation: That the Board of Directors approve the minutes as presented. 6.5. Minutes of the Board of Directors Regular Meeting held May 11, 2015 Recommendation: That the Board of Directors approve the minutes as presented. 6.6. Minutes of the Board of Directors Special Meeting held May 18, 2015 Recommendation: That the Board of Directors approve the minutes as presented. 6.7. Minutes of the Board of Directors Workshop Meeting held May 21, 2015 Recommendation: That the Board of Directors approve the minutes as presented. 6.8. Payments of Bills, Refunds, and Wire Transfers Recommendation: That the Board of Directors ratify and authorize disbursements in the amount of $403,787.19. 3 7. ACTION CALENDAR 7.1. Mitigated Negative Declaration for the Well 21 Equipping and Richfield Road Pipeline Projects Mr. Marcantonio stated that staff’s recommendation regarding this matter would need to be revised per advice received from legal counsel. A copy of the amended recommendation was distributed to the Board and made available to members of the public. Mr. Marcantonio then provided a summary of the declaration and. Staff responded to questions from the Board. Director Kiley made a motion, seconded by Director Hawkins, to (1) adopt the proposed mitigated negative declaration, finding that on the basis of the whole record before it (including the IES and comments received), that there is no substantial evidence that the project will have a significant effect on the environment and that the mitigated negative declaration reflects the Board of Directors’ independent judgment and analysis; (2) approve the proposed project and adopt the Mitigation and Monitoring Program; and authorize staff to file a Notice of Determination for the Project; and (3) that the Board Secretary is the custodian of the documents and materials which constitute the record of proceedings upon which the Board’s decision is based and such documents and materials will be at the District’s headquarters. Motion carried 5-0. Mr. Thomas left the meeting at this time. 7.2. Adopting a Patient Protection and Affordable Care Act Policy Mrs. Knight stated that the policy had been revised per advice received from legal counsel. A copy of the amended document was distributed to the Board and made available to members of the public. Mrs. Knight then described the purpose of the policy and responded to questions from the Board. Director Beverage made a motion, seconded by Director Kiley, to adopt Resolution No. 15-10 Adopting a Patient Protection and Affordable Care Act Policy as amended. Motion carried 5-0 on a Roll Call vote. 7.3. Proposed Budgeted Positions for FY 2015/2016 Mr. Marcantonio stated that a revised copy of the agenda report had been distributed to the Board and made available to the public. Mrs. Knight then summarized the proposed budgeted positions for the next fiscal year and responded to questions from the Board. Director Melton made a motion, seconded by Director Beverage, to adopt Resolution No. 15-11 Approving the Budgeted Positions for Fiscal Year 2015/2016 and Rescinding Resolution No. 14-13. Director Beverage suggested that the Board consider classifying future full-time positions as limited term. 4 Motion carried 5-0 on a Roll Call vote. 7.4. Appropriations Limit for FY 2015/16 Mr. Marcantonio explained the purpose of the appropriations limit. Mrs. Lugo then responded to questions from the Board. Director Kiley made a motion, seconded by Director Hawkins, to adopt Resolution No. 15-12 Adopting the Appropriations Limit for Fiscal Year 2015/16. Motion carried 5-0 on a Roll Call vote. 7.5. Adopting a Public Investment Policy Mr. Marcantonio explained the purpose of the public investment policy and noted that staff was recommending no changes at this time. Director Hawkins made a motion, seconded by Director Kiley, to adopt Resolution No. 15-13 Setting Forth a Public Funds Investment Policy and Rescinding Resolution No. 14-05. Motion carried 5-0 on a Roll Call vote. 7.6. Financial Reserves Policy for FY 2015/2016 Mr. Marcantonio explained the purpose of the financial reserves policy and noted that staff was not recommendation any major changes at this time. Mrs. Lugo noted that the Board could choose to amend the policy following the budget process if desired. Director Kiley made a motion, seconded by Director Melton, to adopt Resolution No. 15-14 Adopting the Financial Reserves Policy for Fiscal Year 2015/2016 and Rescinding Resolution No. 14-06. Motion carried 5-0 on a Roll Call vote. 8. DISCUSSION ITEMS 8.1. Draft FY 2015/2016 Operating Budget This matter was not discussed during the meeting. Director Collett requested that staff report on the District’s bond ratings at the next Board of Directors’ workshop meeting. 9. REPORTS, INFORMATION ITEMS, AND COMMENTS 9.1. President's Report None. 9.2. Directors' Reports Each of the Directors reported on their attendance at the following events. Drought Tolerant Landscaping Workshop – June 3, 2015 Save Water Expo – June 6, 2015 AWWA ACE15 Conference – June 7-10, 2015 5 9.3. General Manager's Report Mr. Marcantonio provided the Board with an overview of his activities and meeting attendance. He then asked each manager in attendance to provide a report regarding activities within their respective departments. 9.4. General Counsel's Report None. 9.5. Future Agenda Items and Staff Tasks None. 10. COMMITTEE REPORTS 10.1. Interagency Committee with MWDOC and OCWD (Collett / Melton) Minutes of the meeting held May 26, 2015 at 4:00 p.m. Next meeting is scheduled July 28, 2015 at 4:00 p.m. 10.2. Joint Agency Committee with City of Placentia (Melton / Kiley) Next meeting is scheduled June 16, 2015 at 9:00 a.m. and will be held at Placentia City Hall. 10.3. Joint Agency Committee with City of Yorba Linda (Collett / Beverage) Minutes of the meeting held May 19, 2015 at 10:00 a.m. (To be provided at the next regular Board meeting.) Next meeting is scheduled June 23, 2015 at 10:00 a.m. and will be held at Yorba Linda City Hall. 10.4. Citizens Advisory Committee (Collett) Next meeting is scheduled June 22, 2015 at 8:30 a.m. 11. INTERGOVERNMENTAL MEETINGS Each of the Directors reported on their attendance at the following meetings. 11.1. YL LMCAC - May 28, 2015 (Beverage - As Needed) 11.2. MWDOC Board - June 3, 2015 (Melton) 11.3. OCSD Operations Committee - June 3, 2015 (Kiley/Beverage) 11.4. OCWD Board - June 3, 2015 (None) 6 11.5. YL City Council - June 4, 2015 (Beverage) Mayor Pro Tem Lindsey addressed the Board and commented on the potential use of recycled water for the filling of pools and the public’s perception of the District’s drought penalty ordinance. The Directors then continued their reports on their attendance at the following meetings. 11.6. WACO - June 5, 2015 (Hawkins/Kiley) 11.7. YL Planning Commission - June 10, 2015 (Melton) 12. BOARD OF DIRECTORS ACTIVITY CALENDAR 12.1. Meetings from June 12, 2015 – July 31, 2015 The Board reviewed the activity calendar and made no changes. 13. CONFERENCES, SEMINARS, AND SPECIAL EVENTS 13.1. Save Water Expo – June 6, 2015 CASA Annual Conference – August 19-21, 2015 UWI Annual Conference – August 26-28, 2015 Director Hawkins made a motion, seconded by Director Kiley, to authorize and/or ratify Director attendance at these events if desired. Motion carried 5-0. 14. CLOSED SESSION The meeting was adjourned to Closed Session at 10:45 a.m. All Directors were present. Also present were Mr. Marcantonio and Mr. Beltran. 14.1. Conference with Legal Counsel – Pending Litigation Pursuant to Subdivision (a) of Section 54956.9 of the California Government Code Name of Case: Successor Agency to the Yorba Linda Redevelopment Agency vs. State of California, et al. (Sacramento County Superior Court - Case No. 34-2015-80002091) The Board reconvened in Open Session at 11:05 a.m. President Collett stated that no action was taken during Closed Session that was required to be reported under the Brown Act. 7 15. ADJOURNMENT 15.1. The meeting was adjourned at 11:05 a.m. A Board of Directors Workshop Meeting has been scheduled for Thursday, June 18, 2015 at 1:00 p.m. The next Regular Board of Directors Meeting will be held Thursday, June 25, 2015 at 8:30 a.m. Annie Alexander Assistant Board Secretary ITEM NO. 7.1 AGENDA REPORT Meeting Date: July 9, 2015 Subject:Minutes of the Board of Directors Workshop Meeting held June 18, 2015 STAFF RECOMMENDATION: That the Board of Directors approve the minutes as presented. ATTACHMENTS: Name:Description:Type: 061815_BOD_Workshop_-_Minutes.doc Minutes Minutes Approved by the Board of Directors of the Yorba Linda Water District 7/9/2015 MB/GM 5-0 1 MINUTES OF THE YORBA LINDA WATER DISTRICT BOARD OF DIRECTORS WORKSHOP MEETING Thursday, June 18, 2015, 1:00 p.m. 1717 E Miraloma Ave, Placentia CA 92870 1. CALL TO ORDER The June 18, 2015 Yorba Linda Water District Board of Directors Workshop Meeting was called to order by President Collett at 1:00 p.m. The meeting was held in the Board/Training Room at the District’s Administration Building located at 1717 East Miraloma Avenue in Placentia, California 92870. 2. PLEDGE OF ALLEGIANCE President Collett led the pledge. 3. ROLL CALL DIRECTORS PRESENT STAFF PRESENT Ric Collett, President Marc Marcantonio, General Manager Michael J. Beverage, Vice President Steve Conklin, Engineering Manager Phil Hawkins John DeCriscio, Operations Manager Robert R. Kiley Gina Knight, Human Resources/Risk Manager Gary T. Melton Delia Lugo, Finance Manager Art Vega, Information Technology Manager Damon Micalizzi, Public Information Manager Annie Alexander, Executive Secretary Cindy Botts, Management Analyst 4. PUBLIC COMMENTS None. 5. DISCUSSION ITEMS 5.1. Draft FY 2015/16 Operating Budget (Materials to be provided at the meeting.) Mrs. Lugo provided an overview of the key budget assumptions, the State Water Resources Control Board’s (SWRCB) calculations, revised operating plan, and the budget summary. Staff then responded to questions from the Board regarding bookkeeping practices as related to drought penalties, water consumption numbers in June, and drought related signage in the community. Mrs. Lugo then reviewed the following: • expense key factors; • supplies, services and salary related expenses; • reserve requirements; and • vehicle equipment and capital outlay. 2 Mr. Conklin also provided a brief overview of the District’s 5-year Capital Improvement Plan. Following discussion, the Board determined to (1) consider approving the final draft of the budget at the regular meeting on June 25, 2015 at 8:30 a.m.; (2) review the water/sewer rate studies at the regular meeting on July 9, 2015 at 8:30 a.m.; (3) potentially approve the Notice of Public Hearing concerning proposed rate increases at the regular meeting on July 9, 2015 at 8:30 a.m. (or at a special meeting on July 16, 2015 at 8:30 a.m.); (4) reschedule the regular meeting on September 10, 2015 to 8:30 a.m. instead of 6:30 p.m.; and (5) conduct a Public Hearing concerning proposed rate increases at a special meeting on September 17, 2015 at 6:30 p.m. 6. ADJOURNMENT 6.1. The meeting was adjourned at 2:15 p.m. The next Regular Board of Directors Meeting will be held Thursday, June 25, 2015 at 8:30 a.m. Annie Alexander Assistant Board Secretary ITEM NO. 7.3 AGENDA REPORT Meeting Date: July 9, 2015 Subject:Minutes of the Board of Directors Special Meeting held June 18, 2015 STAFF RECOMMENDATION: That the Board of Directors approve the minutes as presented. ATTACHMENTS: Name:Description:Type: 061815_BOD_Special_-_Minutes.doc Minutes Minutes Approved by the Board of Directors of the Yorba Linda Water District 7/9/2015 MB/GM 5-0 1 MINUTES OF THE YORBA LINDA WATER DISTRICT BOARD OF DIRECTORS SPECIAL MEETING Thursday, June 18, 2015, 2:30 p.m. 1717 E Miraloma Ave, Placentia CA 92870 1. CALL TO ORDER The June 18, 2015 Yorba Linda Water District Board of Directors Special Meeting was called to order by President Collett at 2:30 p.m. The meeting was held in the Board/Training Room at the District’s Administration Building located at 1717 East Miraloma Avenue in Placentia, California 92870. 2. ROLL CALL DIRECTORS PRESENT STAFF PRESENT Ric Collett, President Marc Marcantonio, General Manager Michael J. Beverage, Vice President Steve Conklin, Engineering Manager Phil Hawkins John DeCriscio, Operations Manager Robert R. Kiley Gina Knight, Human Resources / Risk Manager Gary T. Melton Art Vega, Information Technology Manager Damon Micalizzi, Public Information Manager Annie Alexander, Executive Secretary 3. PUBLIC COMMENTS None. 4. ACTION CALENDAR 4.1. Budget Trailer Bill (TB) 807 - Drinking Water Program Mr. Marcantonio provided a summary of the proposed legislation and explained that staff did not have a recommendation for the Board to consider regarding the District’s support or opposition of this bill. Director Hawkins made a motion, seconded by Director Kiley, not to take any action on this matter. Motion carried 5-0. 4.2. Budget Trailer Bill (TB) 825 - Water System Consolidation Mr. Marcantonio provided an overview of the proposed legislation and noted that hat staff was recommending that the Board consider opposing this bill and submitting a letter to local legislators to that effect. Director Hawkins made a motion, seconded by Director Melton, to (1) take an Oppose position on TB 825; and (2) submit a letter to local legislators indicating the District’s opposition. Motion carried 5-0. 2 5. ADJOURNMENT 5.1. The meeting was adjourned at 2:35 p.m. The next Regular Board of Directors Meeting will be held Thursday, June 25, 2015 at 8:30 a.m. Annie Alexander Assistant Board Secretary ITEM NO. 7.4 AGENDA REPORT Meeting Date: July 9, 2015 Subject:Minutes of the Board of Directors Regular Meeting held June 25, 2015 STAFF RECOMMENDATION: That the Board of Directors approve the minutes as presented. ATTACHMENTS: Name:Description:Type: 2015-06-25_-_BOD_-_Minutes.doc Minutes Minutes Approved by the Board of Directors of the Yorba Linda Water District 7/9/2015 MB/GM 5-0 1 MINUTES OF THE YORBA LINDA WATER DISTRICT BOARD OF DIRECTORS REGULAR MEETING Thursday, June 25, 2015, 8:30 a.m. 1717 E Miraloma Ave, Placentia CA 92870 1. CALL TO ORDER The June 25, 2015 Regular Meeting of the Yorba Linda Water District Board of Directors was called to order by President Collett at 8:32 a.m. The meeting was held in the Board Room at the District’s Administration Building located at 1717 East Miraloma Avenue in Placentia, California 92870. 2. PLEDGE OF ALLEGIANCE President Collett led the pledge. 3. ROLL CALL DIRECTORS PRESENT STAFF PRESENT Ric Collett, President Marc Marcantonio, General Manager Michael J. Beverage, Vice President Steve Conklin, Engineering Manager Robert R. Kiley John DeCriscio, Operations Manager Phil Hawkins Gina Knight, Human Resources / Risk Manager Gary T. Melton Delia Lugo, Finance Manager Art Vega, Information Technology Manager Damon Micalizzi, Public Information Manager Annie Alexander, Executive Secretary ALSO PRESENT Brett Barbre, Director, MWDSC and MWDOC Gene Hernandez, Mayor, City of Yorba Linda Art Kidman, Partner, Kidman Law LLP Heather Stratman, Vice President, Townsend Public Affairs Eric O’Donnell, Townsend Public Affairs Rosemarie Sauer, Resident 4. ADDITIONS/DELETIONS TO THE AGENDA None. 5. PUBLIC COMMENTS Ms. Rosemarie Sauer, resident, addressed the Board and commented on the printed materials being distributed by the District related to the drought, conflicting information she’d received regarding the filling/refilling of outdoor swimming pools, and the large turnout at the drought tolerant landscaping workshop held earlier in the month. 2 Ms. Heather Stratman, Vice President at Townsend Public Affairs, addressed the Board and provided an update on legislative affairs including the passage of the state’s budget and available funding. Mr. Brett Barbre, Director at MWDSC and MWDOC, addressed the Board and provided a report regarding the status of various water storage locations. 6. SPECIAL RECOGNITION 6.1. Recognition of Delia Lugo, Finance Manager, for 5 Years of Service to the District Mr. Marcantonio presented Mrs. Lugo with a certificate and pen in recognition of her service to the District. The Board then applauded Mrs. Lugo on her accomplishment. 7. CONSENT CALENDAR Director Beverage made a motion, seconded by Director Hawkins, to approve the Consent Calendar. Motion carried 5-0. 7.1. Minutes of the Board of Directors Regular Meeting held May 28, 2015 Recommendation: That the Board of Directors approve the minutes as presented. 7.2. Payments of Bills, Refunds, and Wire Transfers Recommendation: That the Board of Directors ratify and authorize disbursements in the amount of $1,192,467.09. 8. ACTION CALENDAR 8.1. Revised Budgeted Positions for FY 2015/2016 Mr. Marcantonio explained that this matter was being presented to the Board for consideration a second time due to an error discovered in Exhibit A. Director Kiley made a motion, seconded by Director Melton, to approve Resolution No. 15-15 Adopting the Budgeted Positions for Fiscal Year 2015/2016 and Rescinding Resolution No. 15-11. Motion carried 5-0 on a Roll Call vote. 8.2. Proposed Budget for FY 2015/16 Mr. Marcantonio explained that the final draft of the budget was being presented to the Board for review and proposed adoption. The Letter of Transmittal and Budget Overview were provided to the Board and made available to the public prior to the meeting. President Collett stated that he had some additional questions and suggested that consideration of this matter be deferred to the next regular meeting. Director Melton suggested that the Board consider scheduling another workshop meeting. Following 3 discussion, the Board determined to schedule a workshop meeting on Wednesday, July 8, 2015 at 2:00 p.m. for this purpose. Proposed adoption would then take place at the next regular meeting on Thursday, July 9, 2015 at 8:30 a.m. 9. REPORTS, INFORMATION ITEMS, AND COMMENTS 9.1. President's Report President Collett briefly commented on local firefighting efforts being affected by a drone. 9.2. Directors' Reports President Collett commented on the overall condition of the landscape being maintained by the City of Yorba Linda. Director Kiley commented on the landscape located in the medians. 9.3. General Manager's Report Mr. Marcantonio asked each manager in attendance to provide a report regarding activities within their respective departments. He then provided the Board with an overview of his activities and meeting attendance. 9.4. General Counsel's Report Mr. Kidman commented on litigation initiated against the State Water Resources Control Board. 9.5. Future Agenda Items and Staff Tasks None. 10. COMMITTEE REPORTS 10.1. Interagency Committee with MWDOC and OCWD (Collett / Melton) Next meeting is scheduled July 28, 2015 at 4:00 p.m. 10.2. Joint Agency Committee with City of Placentia (Melton / Kiley) Minutes of the meeting held June 22, 2015 at 2:00 p.m. will be provided at the next regular Board meeting. Next meeting is yet to be scheduled. Director Melton noted that staff had been asked to provide a presentation at the next Placentia City Council meeting. The Board and staff briefly discussing the content of the presentation. 4 10.3. Joint Agency Committee with City of Yorba Linda (Collett / Beverage) Minutes of the meeting held June 23, 2015 at 10:00 a.m. will be provided at the next regular Board meeting. Next meeting is yet to be scheduled. 10.4. Citizens Advisory Committee (Collett) Minutes of the meeting held June 22, 2015 at 8:30 a.m. will be provided at the next regular Board meeting. Next meeting is scheduled to be held July 27, 2015 at 8:30 a.m. 11. INTERGOVERNMENTAL MEETINGS Each of the Directors reported on their attendance at the following meetings. 11.1. YL LMCAC - June 11, 2015 (Beverage - As Needed) 11.2. YL City Council - June 16, 2015 (Collett) 11.3. MWDOC Board - June 17, 2015 (Melton) 11.4. OCWD Board - June 17, 2015 (Kiley) 11.5. YL Planning Commission - June 24, 2015 (Hawkins) 11.6. OCSD - June 24, 2015 (Kiley/Beverage) 12. BOARD OF DIRECTORS ACTIVITY CALENDAR 12.1. Meetings from June 26, 2015 – July 31, 2015 The Board reviewed the activity calendar and made no additional changes. 13. CONFERENCES, SEMINARS, AND SPECIAL EVENTS 13.1. Weymouth Water Treatment Plant Inspection Trip - July 17, 2015 MWDOC Water Policy Forum - July 29, 2015 Director Hawkins made a motion, seconded by Director Beverage, to authorize Director attendance at these events if desired. Motion carried 5-0. 5 14. ADJOURNMENT 14.1. The meeting was adjourned at 10:41 a.m. The next Regular Board of Directors Meeting will be held Thursday, July 9, 2015 at 8:30 a.m. Annie Alexander Assistant Board Secretary ITEM NO. 7.5 AGENDA REPORT Meeting Date: July 9, 2015 Budgeted:Yes To:Board of Directors Cost Estimate:$476,386.82 Funding Source:All Funds From:Marc Marcantonio, General Manager Presented By:Delia Lugo, Finance Manager Dept:Finance Reviewed by Legal:N/A Prepared By:Richard Cabadas, Accounting Assistant I CEQA Compliance:N/A Subject:Payments of Bills, Refunds, and Wire Transfers SUMMARY: Section 31302 of the California Water Code says the District shall pay demands made against it when they have been approved by the Board of Directors. Pursuant to law, staff is hereby submitting the list of disbursements for Board of Directors’ approval. STAFF RECOMMENDATION: That the Board of Directors ratify and authorize disbursements in the amount of $476,386.82. DISCUSSION: The major items on this disbursement list are as follows: A check of $44,362.67 to CalCard US Bank for credit card transactions processed on June 2015; and a wire of $16,025.05 to So. Cal GIB – Wells Fargo Bank for April through June 2015 line of credit fees. The balance of $153,753.39 is routine invoices. The Accounts Payable check register total is $214,141.11; Payroll No. 13 total is $262,245.71; and the disbursements of this agenda report are $476,386.82. A summary of the checks is attached. PRIOR RELEVANT BOARD ACTION(S): The Board of Directors approves bills, refunds and wire transfers semi-monthly. ATTACHMENTS: Name:Description:Type: CkReg070915.pdf CHECK REGISTER Backup Material 15-CS_0709.pdf CAP SHEET Backup Material 15_CC_0709.pdf CREDIT CARD SUMMARY Backup Material Approved by the Board of Directors of the Yorba Linda Water District 7/9/2015 MB/GM 5-0 Check No.Date Vendor Name Amount Description 65879 07/09/2015 Aramark 423.49 UNIFORM SERVICE 65869 07/09/2015 ARCHSTONE YORBA LINDA 233.51 CUSTOMER REFUND 65880 07/09/2015 Associated Laboratories 3,404.70 MAY & JUNE INVOICES - LAB TEST 65881 07/09/2015 AT & T - Calnet2 3,767.92 CALNET 2 - APRIL & MAY 2015 65882 07/09/2015 Autoscribe Corporation 735.25 PAYMENT VISION GATEWAY API 65883 07/09/2015 BC Traffic Specialist 418.74 SAFETY EQUIPMENT 65884 07/09/2015 Best Drilling and Pump, Inc.7,378.00 WELL 18 65885 07/09/2015 Boot World Inc.237.58 BOOT REIMBURSEMENT - JIMENEZ, R 65886 07/09/2015 CalCard US Bank 44,362.67 JUNE 2015 - CREDIT CARD TRANSACTIONS 65888 07/09/2015 CDW Government, Inc 6,176.31 IT EQUIPMENT 65889 07/09/2015 City Of Yorba Linda 3,402.63 FY 14/15 LMAD ASSESMENT 65890 07/09/2015 Clinical Lab. Of San Bern.2,440.00 LAB SAMPLES - JUNE 2015 65891 07/09/2015 Coastline Equipment 409.00 DASH DISPLAY MONITOR - #145 65892 07/09/2015 Cynthia Botts 62.38 TRAVEL EXPENSE REIMBURSEMENT 65894 07/09/2015 Dean Criske Trucking 1,083.77 SAND & BASE MATERIAL 65893 07/09/2015 Dell Marketing L.P.13,283.68 VLA SQL SERVER 65895 07/09/2015 Department of Toxic Substance Control 175.00 EPA ID NUM & HAZARD WASTE DUE 65877 07/09/2015 DIMIS CHRISTOPHY 178.80 CUSTOMER REFUND 65875 07/09/2015 DONGMEI BIAN 189.69 CUSTOMER REFUND 65896 07/09/2015 Eisel Enterprises, Inc.541.08 METER BOX, LIDS, AND COVERS 65897 07/09/2015 Environmental Engineering & Contracting Inc.933.53 PROF. SVCS - MAY 2015 65898 07/09/2015 eSecurityToGo, LLC 2,453.48 PROF. SVCS - M500 WATCHGUARD 65874 07/09/2015 EVAN M KNUTSON 138.02 CUSTOMER REFUND 65899 07/09/2015 Fairway Ford Sales, Inc.452.18 AUTO MAINTENANCE - FUEL PRESS 65878 07/09/2015 FANG ZHANG 184.01 CUSTOMER REFUND 65900 07/09/2015 Fleet Services, Inc 3,145.43 AUTO MAINTENANCE - UNIT#168 65901 07/09/2015 Francisco R. Quintero 129.12 BOOT REIMB - QUINTEROS, F 65902 07/09/2015 George Baltierra 78.30 BOOT REIMBURSEMENT - BALTIERRA 65903 07/09/2015 George Lee 1,088.00 CASH REFUND - PROJ. CANCELLED 65904 07/09/2015 Haaker Equipment Co.436.00 ALUMINUM PIPE 72"X8 65905 07/09/2015 Hushmand Associates Inc 7,384.00 J2012-13 -& J2014-13S PROJECTS 65906 07/09/2015 Infosend Inc.9,489.21 DATA, PRINT, & POSTAGE 65907 07/09/2015 Jackson's Auto Supply - Napa 1,604.05 PARTS FOR AUTO MAINTENANCE 65908 07/09/2015 Jennifer Hill 80.00 CERTIFICATE RENEWAL - DIST. OPER 2 65873 07/09/2015 JINYAN LU 128.51 CUSTOMER REFUND 65868 07/09/2015 JOSEPH FRANKS 484.85 CUSTOMER REFUND 65909 07/09/2015 Kenny Graff 55.00 CERTIFICATE REIMBURSEMENT 65910 07/09/2015 Kimball Midwest 353.40 HARDWARE SUPPLIES 65911 07/09/2015 Konica Minolta Business 266.77 BIZHUB C224 - LEASE 65872 07/09/2015 LEONARD SUAREZ 179.92 CUSTOMER REFUND 65912 07/09/2015 Liebert Cassidy Whitmore 1,224.50 GENERAL LEGAL SERVICE 65876 07/09/2015 LORI S CHOH 178.83 CUSTOMER REFUND 65913 07/09/2015 Marc Marcantonio 93.85 MILEAGE REIMBURSEMENT 65914 07/09/2015 Mc Fadden-Dale Hardware 208.76 HARDWARE SUPPLIES 65915 07/09/2015 Mc Master-Carr Supply Co.364.07 WAREHOUSE SUPPLIES 65916 07/09/2015 Michael J. Beverage 51.76 MILEAGE REIMBURSEMENT - BEVERAGE,M 65917 07/09/2015 MR2 Solutions Inc 11,243.32 DISASTER RECOVERY & CAPITALIZED ITEMS 65918 07/09/2015 Municipal Water District 80.66 MWDOC WATER USE EFFICIENCY 65919 07/09/2015 National Signal Inc.375.00 REPAIR MESSAGE BOARD E-158 65920 07/09/2015 Nickey Kard Lock Inc 5,508.11 FUEL - JUNE 2015 65921 07/09/2015 Nickey Petroleum Co Inc 246.78 MOBIL DTE HEAVY 65922 07/09/2015 Northern Tool & Equipment Co 1,745.56 HOSE REEL 3/4" X 50' 65923 07/09/2015 Office Solutions 1,906.25 OFFICE SUPPLIES 65927 07/09/2015 P.T.I. Sand & Gravel, Inc.1,179.65 COLD MIX ASPHALT 65924 07/09/2015 Phil Hawkins 56.98 MILEAGE REIMBURSEMENT 65925 07/09/2015 Plumbers Depot Inc.597.01 HOSE, 1"X20FT 3000 PSI 65926 07/09/2015 Professional Pipe Service 17,435.00 CIPP LINING - 91LF 65940 07/09/2015 Rachel Padilla/Petty Cash 743.09 PETTY CASH 65928 07/09/2015 Raftelis Financial Consultants, Inc.9,950.00 PROFESSIONAL SERVICES - MAY 2015 65871 07/09/2015 RAMEE SPARKS 95.87 CUSTOMER REFUND 65929 07/09/2015 Red Wing Shoe Store - Orange 423.36 BOOT ALLOWANCE - PACE & GUTIERREZ 65930 07/09/2015 Richard Collett 120.56 MILEAGE REIMBURSEMENT 65870 07/09/2015 RICHARD HADDIX 125.25 CUSTOMER REFUND 65931 07/09/2015 RKI Engineering, LLC 2,400.00 WONDERWARE - STORAGE OVERVIEW Yorba Linda Water District Check Register For Checks Dated: 06/26/2015 thru 7/09/2015 65932 07/09/2015 Robert Kiley 71.94 MILEAGE & DATA PLAN REIMBURSEMENT 65933 07/09/2015 Safety-Kleen Systems Inc 35.00 WASTE OIL SERVICE 65934 07/09/2015 Sanders Paving, Inc.12,998.00 ASPHALT PAVING 65887 07/09/2015 SARBS-CWEA 425.00 2015 SUMMER COLLECTION & SAFET 65935 07/09/2015 Schorr Metals, Inc.74.17 SCRAP METAL 65936 07/09/2015 Security Solutions 4,452.68 UPGRADE SYSTEM AT YLWD 65937 07/09/2015 Shred-It USA Inc 101.73 ON SITE SHRED SERVICES W063015 06/30/2015 SoCal GIB-Wells Fargo Bank 16,025.05 LOC - APRIL-JUNE 2015 65938 07/09/2015 Southern Calif Edison Co.367.02 6354 - JUNE 2015 65939 07/09/2015 Southern Calif Gas Co.2,293.32 VALLEY VIEW & FAIRMONT - JUNE 2015 65941 07/09/2015 Steven James Morse 2,400.00 PROF. VIDEO SERVICES 65942 07/09/2015 Sunrise Medical Group 75.00 MED - VACCINE - WOOLSEY, M 65943 07/09/2015 Switch Ltd 500.00 SECURITY DEPOSIT - COLOCATION 214,141.11 . June 26, 2015 CHECK NUMBERS & WIRES: Computer Checks 65868—65943 $ 198,116.06 Void Check 65455 & 65525 $ 0.00 ___________ $ 198,116.06 WIRE: W063015 SoCal GIB-Wells Fargo $ 16,025.05 ____________ $ 16,025.05 TOTAL OF CHECKS & WIRE $214,141.11 PAYROLL NO. 13: Direct Deposits $ 164,527.08 Third Party Checks 6169—6180 $ 52,186.07 Payroll Taxes $ 45,532.56 $ 262,245.71 TOTAL OF PAYROLL $262,245.71 ---------------------------------------------------------------------------------------------------------------------- DISBURSEMENT TOTAL: $476,386.82 ================================================================== APPROVED BY THE BOARD OF DIRECTORS MINUTE ORDER AT BOARD MEETING OF July 09, 2015 ==================================================================. Date Vendor Name Amount Description 6/2/2015 Stefano's 605.00 Food for Drought Landscape Workshop 6/10/2015 Hilton Anaheim 72.48 Lunch meeting with Marc M. & BOD Hawkins 6/15/2015 Yorba Linda Chamber of Commerce 800.00 Ad in Chamber Magazine for 6 months 6/15/2015 Home Depot 49.16 Building repair parts for Administration Building 6/16/2015 Yorba Linda Chamber of Commerce 15.00 Lunch meeting with Yorba Linda Chamber 6/16/2015 Costco 775.06 Supplies for employee events and breakroom 6/16/2015 Home Depot 206.06 Supplies for Conservation signs 6/16/2015 Farmer Brothers 12.90 Breakfast meeting with Marc M. & BOD Kiley 6/16/2015 American Signs 1,944.00 Conservation 36% signs 6/16/2015 Orange County Clerk-Recorder Office 2,210.00 Fish & Game - Negative Declaration CEQA Fees 6/17/2015 Urban Water Institute 475.00 Registration for UWI Annual Conference 6/17/2015 Home Depot 106.98 Paint & Supplies for Conservation Message Board 6/17/2015 Orchard Supply 18.47 Supplies for Conservation signs 6/17/2015 Graziano's Italian Restaurant 126.87 Recognition lunch for Safety Committee 6/17/2015 Planet Beauty 43.20 Safety Incentive raffle prizes 6/18/2015 Village Nurseries 186.84 Sod for landscape repair 6/22/2015 Orchard Supply 18.65 Building repair parts for Building 2 6/22/2015 REI.com 63.72 Supplies for heat prevention compliance 6/22/2015 Amazon 58.35 Supplies for heat prevention compliance 6/22/2015 Home Depot 43.07 Supplies for heat prevention compliance 6/22/2015 Home Depot 59.27 Supplies for heat prevention compliance 6/22/2015 McFadden-Dale Industrial Hardware 42.66 Supplies for Engineering 6/22/2015 United Water Works 14,998.92 Inventory - water warehouse stock 6/23/2015 Stefano's 54.99 Lunch with 3 new Enforcement Staff 6/23/2015 MWDOC 640.00 Table Sponsorship for MWDOC Water Policy Forum 6/23/2015 Fullerton Paint & Flooring 129.34 Paint for Value Cans 6/23/2015 Lawnpost Pizza 22.14 Lunch with Operations Manager & Supervisor(s) 6/23/2015 City of Anaheim 2,000.00 Richfield Road Pipeling - Plancheck Fee 6/23/2015 United Water Works 14,987.52 Inventory - water warehouse stock 6/24/2015 Light Bulb, Etc.304.78 Light Bulbs for Administration Bldg. & Building 2 6/24/2015 C. Wells Pipeline Materials 1,056.11 Parts for Tapping Machine 6/24/2015 B&M Lawn Garden 46.87 Repair of weed-eaters 6/24/2015 Equifax Verification Services 27.95 Employment verification 6/24/2015 Republic Servies 504.52 Trash - 2 front loads 6/24/2015 Answer One Communications 330.00 Telephone answering service 6/24/2015 Konica Minolta Business 869.85 Copier Charges 6/24/2015 Online Information Services 372.05 Utility Exchange Reports 6/26/2015 Ice House 84.89 Ice for community outreach 44,362.67 Cal Card Credit Card U S Bank 6/2/15-6/26/15 ITEM NO. 8.1 AGENDA REPORT Meeting Date: July 9, 2015 To:Board of Directors From:Marc Marcantonio, General Manager Presented By:Delia Lugo, Finance Manager Dept:Finance Prepared By:Delia Lugo, Finance Manager Subject:Proposed Budget for FY 2015/16 SUMMARY: Attached for the Board's review and consideration is the District's Budget for FY 2015/16. The budget allocates employee and financial resources to accomplish the District's mission and vision statements. It presents a framework and financial plan for responsibly carrying out the programs and capital projects that administer, operate, maintain, protect and replace the assets required to provide safe and reliable public water and sewer systems. STAFF RECOMMENDATION: That the Board of Directors approve Resolution No. 15-16 Adopting the Budget for Fiscal Year 2015/16 and Rescinding Resolution No. 14-08. DISCUSSION: In general, this budget identifies $44 million in total outlay this next fiscal year, including $30.3 million in total expenses, $7.4 million in depreciation, and $6.3 million in capital projects. Offsetting this $30.3 million in total expenses is $32.5 million in anticipated revenues, resulting in a net gain of $2.2 million. The Board remains consistent in its decision to not fully fund depreciation expense and the budget reflects this decision. Therefore, the District will operate with a planned net deficit of $5.1 million. Attached to this report is Resolution No. 15-16 adopting the Budget for Fiscal Year 2015/16. STRATEGIC PLAN: FR 1-B: Prepare a High Level Annual Budget Document and Comprehensive Annual Financial Report and Compete for Recognition by the Government Finance Officers Association PRIOR RELEVANT BOARD ACTION(S): The Board of Director's reviewed preliminary budget summaries for FY 2015/16 at five special workshops held on March 31, 2015, April 30, 2015, May 21, 2015, June 18, 2015, and July 8, 2015. ATTACHMENTS: Name:Description:Type: Budget_Resolution_No._15-16.docx Resolution No. 15-16 Backup Material FY_2015-16_Final_Draft_Budget.pdf Backup Material Backup Material Material Distributed Less Than 72 Hours Prior to the Revised_FY_2015-16_Budget.pdf Meeting Backup Material Approved by the Board of Directors of the Yorba Linda Water District 7/9/2015 MB/GM 5-0 Roll Call AS AMENDED Resolution No. 15-16 Adopting the Budget for FY 2015/16 1 RESOLUTION NO. 15-16 RESOLUTION OF THE BOARD OF DIRECTORS OF THE YORBA LINDA WATER DISTRICT ADOPTING THE BUDGET FOR FISCAL YEAR 2015/16 AND RESCINDING RESOLUTION NO. 14-08 WHEREAS, the Yorba Linda Water District has prepared a one year budget for Fiscal Year 2015/16; and WHEREAS, on July 8, 2015, the proposed “Draft” Budget for Fiscal Year 2015/16 was presented and reviewed at a meeting of the Board of Directors of the District; and WHEREAS, the “Final” Budget for Fiscal Year 2015/16 was presented and considered by the Board of Directors at a regular meeting on July 9, 2015; and WHEREAS, it is the desire of the Board of Directors to adopt the Budget for Fiscal Year 2015/16, and rescind Resolution No. 14-08. NOW THEREFORE BE IT RESOLVED by the Board of Directors of the Yorba Linda Water District as follows: Section 1. That the Budget for Fiscal Year 2015/16, set forth in Exhibit “A” attached hereto, is hereby approved and adopted. Section 2. The Budget for Fiscal Year 2015/16 is in full force and effect beginning July 1, 2015, and continuing until this Resolution is rescinded by the Board of Directors. Section 3. That Resolution No. 14-08 is hereby rescinded effective July 1, 2015. PASSED AND ADOPTED this 9th day of July 2015, by the following called vote: Ric Collett, President Yorba Linda Water District Resolution No. 15-16 Adopting the Budget for FY 2015/16 2 ATTEST: Marc Marcantonio, Board Secretary Yorba Linda Water District Reviewed as to form by General Counsel: Arthur G. Kidman, Esq. Kidman Law, LLP ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 1 To the Honorable Board of Directors: We are pleased to present the Yorba Linda Water District FY 2015/16 Draft Budget. The purpose of this document is to identify and allocate the resources needed to accomplish the District’s goals and objectives over the next fiscal year and to present the financial health of the District in a clear and concise manner to the Board of Directors and the general public. The main objective of the proposed Yorba Linda Water District FY 2015/16 budget is to provide adequate funding for all District activities, considering the goal of meeting all regulatory requirements while providing reliable, high quality water and sewer services in an environmentally responsible and financially prudent manner. The proposed budget meets this objective by incorporating operating cost reductions and the use of available financial reserves, while projecting realistic operating revenues without a supplement from the currently approved rate increases. The following are highlights of achievements completed in FY 2014/15; a summary of the goals and objectives for FY 2015/16 and a financial forecast of the District heading into the next five fiscal years: FY 2014/15 Highlights & Accomplishments Capital Improvement & Replacement Projects Completed • Completed Yorba Linda Blvd. Booster Pump Station • Completed Deville Drive Water Line Extension • Completed Lakeview Grade Separation Pipeline Replacement • Completed Orangeview Waterline Extension • Completed Yorba Linda High School Park Pipeline Relocation Projects in Planning, Design or Commencing Construction • Received Conceptual Approval from OCWD for Well #22 Site • Completed Design Fairmont Booster Pump Station Replacement • Completed Design of Richfield Road Pipeline Other District Activities & Accomplishments • Received Positive Auditor’s Letter for FY 2013/14 • Received State and National Recognition for FY 2013/14 CAFR • Received State and National Recognition for FY 2014/15 Budget document • Executed Multi-Year Memorandum of Understanding (MOU) With the YLWD Employees Association • Received the CSDA Certificate of Transparency • Established Water Use Restrictions and Drought Penalties to Comply with State of California Mandate – YLWD Ordinance No. 15-01 ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 2 FY 2014/15 Financial Forecast For the year ending June 30, 2015, staff is anticipating a combined loss of $2,057,622 for the water and sewer enterprises. These figures include total depreciation expenses (a non-cash expense) in the amount of $7,354,700. Please refer to the Summary of Total Revenue and Expenses (Water & Sewer) for supporting information. Beginning July 1, 2014, total reserve funds available for both Operations and Capital Projects was $29.4 million. Staff is forecasting these funds to be $32.6 million by June 30, 2015, for a total addition of $3.2 million for FY 2014/15. Principal Issues, Factors & Challenges for FY 2015/16 For the forthcoming 2015/16 fiscal year, the Yorba Linda Water District will be experiencing one of its greatest challenges in meeting the Governor’s April 1, 2015 Executive Order issuing mandatory water conservation regulations across the state. The subsequent Regulations approved by the State Water Resources Control Board (SWRCB) on May 6, 2015, mandated a conservation reduction (of water use) for YLWD of 36%, comparative to 2013 usage. In response to these events, YLWD Board of Directors adopted Resolution No. 15-04 Instituting Stage 3 of the District’s Conservation Ordinance and Ordinance No. 15-01 Instituting Drought Penalties, both to promote conservation efforts by our customer base. As a result of the SWRCB mandated 36% District-wide conservation reduction established for YLWD, there is a projected budget decrease of 29% in water sales for FY 2015/16 as compared to FY 2014/15. Prior to the Governor’s Executive Order, the District was engaged in a Water and Wastewater Rate Study as authorized by the Board. The study explored gradually shifting more of the customer’s average monthly bill to the basic service charge over a five year period. The intent was to stabilize revenues and meet the District’s cost of service as water conservation efforts continue to be necessary. Unfortunately, due to the Emergency Drought Mandates implemented in May of 2015, which far exceeded the forecasted conservation targets set by the District’s imported water supplier, Metropolitan Water District of Southern California (MWD), this gradual shift to increase the basic service fee will need to be consolidated into the first year, effective October, 1 2015. Additionally the Emergency Mandates require the establishment of drought rates or administrative penalties to impose upon customers who exceed water use restrictions set forth by the SWRCB. The District elected to implement administrative penalties based on reductions comparative to the calendar year 2013 average usage for each of the three customer classes - residential, commercial and irrigation. The collection of these proposed administrative penalties are not for the purpose of recovering the cost of providing water service to District customers, but rather to signal higher than average users of water they need to conserve more. ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 3 As of May 2014, the District was granted annexation of the remaining 26% of its service area into the Orange County Water District (OCWD). It was anticipated that with full annexation the District will be able to pump the maximum groundwater allowable each year, at a lower cost than purchasing the same amount of import (MWD) water. However, the District will not be able to take advantage of full annexation for FY 2015/16, due to the 2003 Conjunctive Use Program (CUP) Agreement and due to the need to complete construction of capital facilities. The CUP Agreement requires the District to withdraw 1,596 acre-feet over and above OCWD’s Basin Production Percentage (BPP) for the upcoming fiscal year and pay for the water at current import water rates, after subtracting power and operations and maintenance charges of $110 per acre-foot. The CUP allows MWD to “store” water in the Orange County Groundwater Basin and call for the extraction of that water, via wells purchased for various agencies, in times of drought when its traditional sources (the Colorado River and Bay-Delta) are less plentiful. Current facility (infrastructure) limitations prevent the District from producing and transferring the full BPP as well as the required CUP obligation. Had the District been able to access the entirety of the BPP in the upcoming fiscal year, the District could potentially lower its variable water costs by approximately $1 million. As later described in this document, the District’s Capital Improvement Program includes construction of pumping, pipeline and well facilities over the next three years that will make it possible for the District to access its full allotment of groundwater. FY 2015/16 Goals & Objectives Key Business Objectives • Evaluate and Update the Financial Reserves Policy to Improve Resiliency During Drought and Decreasing Water Sales Conditions • Revise Business Model to Achieve Cost Recovery of Approximately 40% of Operations and Maintenance Costs with Base Fee and to Reduce Reliance on Volumetric Revenue • Reduce Reliance on Import Water Supply • Perform Analysis and Update of Fee Schedule • Improve Accountability of Water Use and Compliance with District Regulations • Implement Conservation and Enforcement Programs to Support Emergency Drought Condition • Continue Implementation of the District’s Computerized Maintenance and Management System (CMMS) • Implement Increased Distribution System Leakage Detection and Prevention • Consider Opportunities for Expanded Sewer Service Area • Update Current Job Descriptions (District-wide) • Identify Key Roles for Succession • Conduct Leadership Training to Improve Organizational Effectiveness and Efficiency ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 4 • Update and Enhance Website to Provide a Better Customer Experience • Implement Communication Campaign to Educate Customers about Value of Water Capital Improvement & Replacement Projects • Complete Construction of Well #21 Project • Complete Construction of Richfield Road Pipeline • Begin Construction of Fairmont Booster Pump Station Project • Commence CEQA and Design of Well 22 Project • Complete Update of Urban Water Management Plan • Begin In-House Preparation of Updated Water Master Plan • Complete In-House Design Plans & Specifications for Next Phase of Water Line Replacement Program FY 2015/16 Summary Budget Revenues Total water and sewer revenues budgeted for upcoming FY 2015/16 amount to $32.5 million, a decrease of $415,000 from the revenues budgeted for FY 2014/15. The major differences are comprised of the following: Water Revenue ($580,000 decrease) The decrease in Water Revenue is a result of the net effect of projected conservation efforts to meet the SWRCB mandated reduction in consumption and the projected results from the Water and Wastewater Rate Study that will establish an increase on monthly base fee charges to District customers. Water Revenue from Residential, Commercial, and Landscape/Irrigation consumption is projected to decrease by $6.4 million (30%) in FY 2015/16 as a result of District-wide conservation efforts. As a projection of the results from the Water and Wastewater Rate Study, Service Charges for all customers are projected to increase by $4.9 million for FY 2015/16. Sewer Charge Revenue ($34,000 decrease) Sewer Charge Revenue funds help to finance maintenance equipment, system repairs, replacements and improvements associated with the sewer system. This revenue is expected to remain relatively constant. ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 5 Expenses & Outlay Total expenses & outlay (excluding capital projects) budgeted for upcoming FY 2015/16 is $37.6 million, an increase of $1 million from the FY 2014/15 budgeted results. This includes depreciation which totals $7.4 million. The following factors summarize the significant changes: Variable Water Costs ($2,849,000 decrease) The District's variable water costs will decrease by 19% in FY 2015/16. In response to the SWRCB’s mandated conservation reduction for YLWD of 36%, the District’s Production Operating Plan is projecting to generate a total demand of 16,534 AF in FY 2015/16 – a reduction of 5,446 AF from FY 2014/15. The operating plan for FY 2015/16 increases its annual ground water allocation to 60.9% - up by 6.2% from FY 2014/15. The cost per AF for ground water of $322/AF averages to be $613/AF less than the cost of import water per AF. Salaries & Benefits ($589,000 increase) This amount includes the hiring of additional staff, merit increases and reclassifications for those employees who may qualify throughout the year, a Cost of Living Adjustment (COLA) as indicated in the District’s MOU and Compensation letters, increases from CalPERS, medical, dental, and vision premiums, and the assumption that all funded positions will be filled for an entire fiscal year. The FY 2015/16 budget for merit increases for those employees who qualify throughout the year, amounts to approximately $39,000. The Salaries & Benefits budget also includes the addition of two full-time employees and 4 part-time employees, as well as one proposed reclassification of current employee. Salaries relating to CIP projects, in the amount of $135,000, will also be capitalized. The net operating costs for salaries and benefits results in a $589,000 increase from the FY 2014/15 budget. The District has three tiers for retirement benefits through the California Public Employees’ Retirement System (CalPERS): Tier 1 applies to District employees hired prior to January 26, 2012. These employees pay the full employee contribution rate, which is 7% of pensionable compensation and are enrolled in the 2% at 55 CalPERS retirement formula. Tier 2 applies to District employees hired between January 26, 2012 and December 31, 2012, and any District employees hired on or after January 1, 2013 who are defined as “classic members” under the Public Employees’ Retirement Law. These employees pay the full employee contribution rate, which is 7% of pensionable compensation and are enrolled in the 2% at 60 CalPERS retirement formula. Both tier 1 and tier 2 retirement benefits are based on the employee’s single highest year of compensation. These employees are covered under the Fourth Level of 1959 Survivor Benefits. ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 6 Tier 3 applies to District employees hired on or after January 1, 2013 who are “new members” as defined in the Public Employees’ Pension Reform Act of 2013 (PEPRA). These employees pay an initial contribution rate of one-half of the total normal cost of the defined benefit plan and are enrolled in the 2.5% at 67 CalPERS retirement formula. The retirement benefit for these employees is based on an average of three years of final compensation. Commencing July 1, 2015, District employees will receive a Cost-of-Living increase of 6.5% which will be spread over the course of the next three fiscal years. The District will continue to match dollar for dollar of salary earned, not to exceed 2% per payroll period of the employee’s deposits into a qualified Deferred Compensation Plan for any Management or Supervisory/Confidential employee. The District pays 100% of the premium cost for health, dental and vision for all full-time employees and two-thirds of the premium cost for their dependents; offers employees a “4/10” work schedule; an optional 457 deferred compensation plan; a 125 Flex benefits plan; Long and Short Term Disability Insurance; Life Insurance; an Employee Assistance Program; and Tuition Reimbursement. Employees accrue 3.077 hours per pay period of vacation with increases in vacation accruals at 5, 10, 15 and 20 years. After 20 years, the maximum vacation accrual is reached at the rate of 6.922 hours per pay period. There are 26 pay periods per year. Sick leave is accrued at the rate of 3.7 hours per pay period. The District observes eleven paid holidays per year. Reserves and Funding Sources The District has nine water and sewer enterprise-related funding sources. Within the budget document is a summary of these funding sources and their associated balances. Three of these funds are restricted or designated specifically for capital projects including: COP Bonds 2008, Water Capital Projects and Sewer Capital Projects. Both the Water Emergency and the Sewer Emergency Funds are non-restricted and were established to fund unplanned, unbudgeted emergency operations repairs related to the water and sewer system, respectively. The Water Emergency Fund was established in FY 2009/10, with a transfer of $2 million from the Annexation Fund. The Sewer Emergency Fund was established in FY 2007/2008, with the Board of Directors’ decision that approximately $1 per connection per month would be set to fund this account. The Board also established at that time a Sewer Emergency Fund ceiling guideline of $1 million, after which any additional revenue generated would be transferred to Sewer Capital Reserves. ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 7 The remaining three funds are the Water Restricted for Debt Service Fund, which is used to pay the Districts principal and interest payments and the Water and Sewer Operating Funds which are used to fund day-to-day operations and maintenance activities as identified in the budget, which occur as actual expenses. These activities require cash, checks and wire transfers on a regular basis and affect the District’s cash flow. Summary The Water Enterprise is budgeted with a FY 2015/16 loss of $3.8 million under the proposed budget, which includes a rate increase and variable water cost pass-through, and with depreciation of $6 million. This does not include CIP project expenditures, which are funded separately with capital reserves and other identified funds. The Sewer Enterprise is budgeted with a FY 2015/16 loss of $1.3 million, with depreciation of $1.3 million. This also does not include CIP project expenditures, which will require funding from capital reserve funds and operating fund transfers. The State-wide mandated water use restrictions by the SWRCB will pose challenges for all water providers in the coming years. Continuous and effective communications on the many changing issues facing the District is essential as we adapt our business model to these drought conditions and imposed mandates. The challenges presented this year were met by the Yorba Linda Water District’s Board of Directors’ resolve to keep the stability and financial strength of the District as one of its highest priorities. This budget reflects the vision of the Board of Directors of the Yorba Linda Water District, its management, and its employees. We will continue to strive to make improvements in our budget processes, including an extensive review and analysis of projections for revenues, expenditures, capital projects, and reserves. I would like to thank all the staff involved in this process for the efforts put forth in the preparation of this budget to ensure a successful outcome. To the Board of Directors, we acknowledge and appreciate their continued support and direction in achieving excellence in financial management and District operations. Respectfully Submitted, Marc Marcantonio General Manager ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 1 Budget Overview ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 2 Resolution to Adopt Budget RESOLUTION NO. 15-16 RESOLUTION OF THE BOARD OF DIRECTORS OF THE YORBA LINDA WATER DISTRICT ADOPTING THE BUDGET FOR FISCAL YEAR 2015/16 AND RESCINDING RESOLUTION NO. 14-08 WHEREAS, the Yorba Linda Water District has prepared a one year budget for Fiscal Year 2015/16; and WHEREAS, on July 8, 2015, the proposed “Draft” Budget for Fiscal Year 2015/16 was presented and reviewed at a meeting of the Board of Directors of the District; and WHEREAS, the “Final” Budget for Fiscal Year 2015/16 was presented and considered by the Board of Directors at a regular meeting on July 9, 2015; and WHEREAS, it is the desire of the Board of Directors to adopt the Budget for Fiscal Year 2015/16, and rescind Resolution No. 14-08. NOW THEREFORE BE IT RESOLVED by the Board of Directors of the Yorba Linda Water District as follows: Section 1. That the Budget for Fiscal Year 2015/16, set forth in Exhibit “A” attached hereto, is hereby approved and adopted. Section 2. The Budget for Fiscal Year 2015/16 is in full force and effect beginning July 1, 2015, and continuing until this Resolution is rescinded by the Board of Directors. Section 3. That Resolution No. 14-08 is hereby rescinded effective July 1, 2015. PASSED AND ADOPTED this 9th day of July 2015, by the following called vote: Ric Collett, President Yorba Linda Water District ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 3 Mission & Vision Statement 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.” Our Vision “Yorba Linda Water District will become the leading, innovative and efficient source for high quality reliable services.” ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 4 Core Values Statement The Yorba Linda Water District Board of Directors and staff are guided in everything we do by the following core values: Integrity– We demonstrate integrity every day by practicing the highest ethical standards and by ensuring that our actions follow our words. Accountability– We acknowledge that both the Board and the staff of the District are accountable to the public that we serve, as well as to each other. Responsibility– We take full responsibility for our actions- both our successes and our opportunities for growth. We maintain a commitment of courtesy, assessment and resolution with all customer concerns. Transparency – We promote a culture where we actively listen to our customers and communicate openly about our policies, processes and plans for the future. Teamwork – Success centers on all departments working together and sharing information and resources to achieve common goals. We are dedicated to ensuring that every voice of the District, from the Board to each individual employee is treated with dignity and respect, and that differences are valued and individual abilities and contributions are recognized. ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 5 Strategic Goals Statement The Government Finance Officers Association (GFOA) recommends that all governmental entities use some form of strategic planning to provide a long-term perspective for service delivery and budgeting, thus establishing logical links between authorized spending and broad organizational goals. The goals, objectives and action steps within the District’s Strategic Plan were determined by the mission and vision statements and core values of the District and further established through the process initiated by the Board of Directors through a Strategic Plan Workshop. Stakeholders that participated in this process included all five Board Members, the Executive Management team and members of the Employee Productivity-Innovation-Communications (EPIC) Committee, made up of staff representatives with varied levels of experience and expertise from across all District departments. In the District’s strategic planning, goals are defined as identified challenges the District would like to address. Initiatives are defined as high-level concepts or plans for resolving the identified goals. Strategies are defined as action steps to achieving the identified initiatives, which, in turn, achieve the identified goals. Five goals were identified as the most critical challenges for the District to address in the next year: Goal CP: Community Partnership Goal FR: Fiscal Responsibility Goal OE: Operational Efficiency Goal SR: Service Reliability Goal WE: Workforce Engagement ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 6 Goal CP: Community Partnership As a public agency, the District is expected to demonstrate the prudent use of public funds. The District’s services should provide tangible benefits that are of value to the community. Strengthening existing relationships with key stakeholders, including customers and agency partners, while demonstrating our dedication to transparency in the most professional manner, is paramount. Initiatives Strategies Enhance Resources for Public Information & Governmental Affairs Division Develop a Public Relations Master Plan with Measurable Goals Have Board of Directors and YLWD Staff Attend More Events and Inter-governmental Meetings within the Local Community Continue to Support Regional Training and Multi-Agency Workgroups through the Joint Use of the Administration Building Effectively Use Broad Spectrum Communication Opportunities CP 1: Increase Brand Recognition within the Community CP 2: Increase Public Awareness of Water and Wastewater Related Issues CP 1-A CP 1-B CP 1-C CP 1-D CP 1-E CP 1: Increase Brand Recognition within the Community ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 7 Provide Financial Incentives and Rebates for Water Use Efficiency Develop and Expand a Youth Education Program Consider Participation in the California Urban Water Conservation Council’s Best Management Practices Enhance the District’s Regional Water and Wastewater Industry Participation Maintain a Commitment to Updating the District’s Rules and Regulations Pertaining to Water, Sewer & Special District Best Practices Goal FR: Fiscal Responsibility The District is ranked highly by financial ratings organizations, has proven to be a good financial steward, and consistently strives for a clear, well-documented budget process and clean annual financial audit. However, with the state and national economic crisis, the District has an even greater responsibility to demonstrate effective and responsible use of public funds while responding to ever-increasing financial challenges. Initiatives CP 2: Increase Public Awareness of Water and Wastewater Related Issues CP 2-A CP 2-B CP 2-C CP 2-D FR 1: Maintain Fiduciary Responsibility FR 2: Increase Reserve Funding FR 3: Identify and Develop Additional Revenue Options FR 4: Provide an Equitable Rate Structure CP 2-E ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 8 Strategies Develop a Comprehensive Multi-Year Financial Plan Prepare a High Level Annual Budget Document and Comprehensive Annual Financial Report and Compete for Recognition by the Government Finance Officers Association Revise the Water and Sewer Rules and Regulations and Evaluate Fee Schedules Regularly for Proper Cost of Service Coverage Evaluate and Revise the Sewer Fund Allocation Maintain Commitment to a Strong Debt Services Ratio Continue to Record and Report the Fairly Stated Financial Activities of the District in a Timely and Transparent Manner to the Board of Directors and Member Agencies Review the Reserve Policy and Funding Levels Annually Analyze the Asset Management Plan to Determine Future Asset Replacement Needs Implement an Approach to Ensure Reserves are Responsibly Funded FR 1-A FR 1-C FR 1: Maintain Fiduciary Responsibility FR 2: Increase Reserve Funding FR 2-A FR 2-B FR 2-C FR 1-D FR 1-E FR 1-B FR 1-F ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 9 Research and Obtain Grant Funding Whenever Feasible Review Opportunities to Earn “Cash-Back” on Operating Expenses through Commercial Credit Card Accounts Manage Cash Flow to Maximize Investment Income Complete the Cost of Service and Water Rate Study Evaluate Equitable Rate Structures that Promote Conservation and Efficiency Goal OE: Operational Efficiency The District has provided independent, trusted and reliable service for more than one hundred years, yet it recognizes the importance of continual improvements to increase operational efficiency. Initiatives OE 1: Optimize Use of Existing Technologies OE 2: Address Inefficiencies Identified in the Self-Assessment Survey OE 3: Consider Utilization of a Peer Review Survey FR 3-A FR 3-B FR 4-A FR 4-B FR 3: Identify and Develop Additional Revenue Options FR 4: Provide an Equitable Rate Structure FR 3-C ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 10 Strategies Identify the Current Functionality of Existing Technology and Determine if it is Being Utilized to Full Capacity Evaluate How Each Department Might Make Further Use of Existing Technology Provide Support and Encourage Employee Training Improve connectivity for Computerized Maintenance and Management System (CMMS) Improve Internet and Intranet Access Availability by Increasing Bandwidth Integrate GIS with Hydraulic Model, CMMS, Valve Exercise, and Hydrant Flushing Improve Radio Communications Adopt GIS Data Maintenance and Request Procedures Implement Field GIS software (Underground Service Alert, As-built Lining and Red-lining) Convert Transferred Sewer Lines into GIS Install a Reliable Backup Power System at Remote Control Sites OE 1-A OE 1-B OE 1-C OE 1: Optimize Use of Existing Technologies OE 1-D OE 1-E OE 1-F OE 1-G OE 1-H OE 1-I OE 1-J OE 1-K ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 11 Initiate a Comprehensive Backup Work Toward Implementation of a District-Wide Paperless Processing System Identify Core Inefficiencies Develop Measurable Productivity Goals Engage Employees in Methods of Addressing Inefficiencies Determine the Cost Benefit Ratio of a Peer Review Survey Establish a Team to Determine the Focus of the Survey Institute Guidelines for Areas to Be Addressed Goal SR: Service Reliability The ultimate purpose of District assets and infrastructure is to safely and reliably provide vital services to the public. Our goal is to maintain all assets for optimal continuity of District services. Effective management of assets involves monitoring asset conditions against the level of service to manage risk of failure, planning for future financial needs and anticipating uncertainties or changing levels of service. OE 2: Address Inefficiencies Identified in the Self-Assessment Survey OE 2-A OE 2-B OE 2-C OE 3: Consider Utilization of a Peer Review Survey OE 3-A OE 3-B OE 3-C OE 1-L OE 1-M ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 12 Initiatives Strategies Continue with Efforts to Annex District Service Area to Orange County Water District Forecast Service Demand Projections Engage with Regional Agencies on Water Supply Issues Strengthen Existing Emergency Operations Partnerships Develop 1 Additional Well Site Evaluate Alternative Water Sources SR 1: Work Toward Service Reliability and Efficiency SR 2: Explore Service Boundary Opportunities SR 3: Complete Implementation of Capital Improvement Project Plan 2011-2015 SR 1-A SR 1-F SR 1: Work Toward Service Reliability and Efficiency SR 1-B SR 1-C SR 1-D SR 1-E ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 13 Evaluate Feasibility of Providing Additional Water Services within the Region Evaluate Feasibility of Providing Additional Wastewater Services within the Region Evaluate Feasibility of Providing Other Professional Services within the Region Complete Implementation of Five Year Capital Improvement Plan from FY 2011-2015 with adopted amendments Continue Planning for Long Term Capital Improvements and Replacements into the future SR 2: Explore Service Boundary Opportunities SR 2-A SR 2-B SR 3: Complete Implementation of Capital Improvement Project Plan 2011-2015 SR 3-A SR 3-B SR 2-C ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 14 Goal WE: Workforce Engagement The District is known for its highly skilled staff and quality work. In order to retain a highly productive and proficient workforce, maintaining and building on employee engagement in the District will be critical to future success. With uncertain economic times to continue in the near term, however, greater calls for efficiency and responsiveness will require staff to be flexible and prepared to demonstrate effectiveness and accountability. Initiatives Strategies Maintain Competitive Compensation via Classification and Compensation Surveys Explore Alternative Benefits Establish Career Development Expectations of Existing Employees Develop Methodologies to Assist Employees in Attaining Career Expectations Continue to Support Additional Training for Staff WE 1: Retain a Highly Skilled and Capable Workforce WE 2: Develop a Comprehensive Succession Plan WE 3: Enhance Employee Relations WE 1-A WE 1-B WE 1-C WE 1: Retain a Highly Skilled and Capable Workforce WE 1-D WE 1-E ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 15 Encourage Staff Participation in Professional Organizations and Local Civic Groups Execute Timely and Consistent Employee Performance Evaluations Identify Key Roles for Succession Define the Competencies and Motivational Profile Required for Key Roles Identify Individuals with the Potential to Perform Highly in Key Roles Develop Methodologies to Assist Employees in Preparing for Advancement Implement a Program to Recognize Employees for Excellence Conduct Bi-Yearly All Hands Meetings Continue to Encourage Employee Training in Leadership and Technology WE 2: Develop a Comprehensive Succession Plan WE 2-B WE 2-C WE 3: Enhance Employee Relations WE 3-A WE 3-B WE 3-C WE 2-A WE 2-D WE 1-F WE 1-G ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 16 Profile of the District Independent, Trusted and Reliable Service for more than 100 Years The Yorba Linda Water District is an independent special district, which operates under the authority of Division 12 of the California Water Code. The Yorba Linda Water District has been providing water and sewer services to the residents of the City of Yorba Linda, portions of Placentia, Brea, Anaheim, and nearby unincorporated areas since 1959, the year it was formed to take over the assets and water service responsibilities of the Yorba Linda Water Company, a mutual company formed in 1909. The District is governed by a five-member Board of Directors, elected at large from within the District’s service area. The General Manager administers the day-to-day operations of the District in accordance with policies and procedures established by the Board of Directors. The Yorba Linda Water District employs a full-time staff of 80 employees and a part-time staff of 4 employees. The District’s Board of Directors meets on the second and fourth Thursday of each month. Meetings are publicly noticed and citizens are encouraged to attend. The District provides water, sewer or a combination of both services to residents and businesses within its service area, which includes approximately 14,475 acres of land comprising 22.6 square miles. The District serves a population of approximately 70,000 and currently provides water service through approximately 24,703 residential, commercial, and light industrial connections. District Services Residential customers make up approximately 93% of the District’s customer base and consume approximately 72% of the water provided annually by the District. The District's drinking water comes from two sources: local groundwater and "imported water". Approximately 60% comes from local groundwater and 40% comes from "imported water" from the Colorado River via the Colorado River Aqueduct and from Northern California via the State Water Project. The blending of these sources varies according to your geographic location within the District. YLWD currently operates 10 wells within our service area that pump water from the Orange County Groundwater Basin. The groundwater basin is managed by the Orange County Water District (OCWD), who allows more than 20 cities and water agencies, including YLWD, to withdraw water from the basin, via wells, at a cost of approximately $322 per acre-foot. OCWD sets a maximum percentage of water that can be pumped from the ground, the Basin Production Percentage (BPP). ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 17 The remainder of YLWD's drinking water is "imported" water, purchased through the Municipal Water District of Orange County (MWDOC). MWDOC, in turn, purchases water from the State Water Project and the Colorado River Aqueduct, as part of a consortium of 26 agencies, through the Metropolitan Water District of Southern California (MWD). The cost of imported water to the retail agencies, such as YLWD, is almost four times the cost of pumping out of the groundwater basin. Imported water is treated at MWD's Diemer Filtration Plant, located on Valley View and Diemer Road in Yorba Linda. The majority of YLWD's operating expenses are variable water costs, which include purchasing water from both OCWD and MWDOC, as well as electrical and natural gas costs to pump water up to the highest elevations. The District has a unique water delivery system to provide service to homes ranging from 250 to 1,390 feet above sea level, from the Chino Hills to the Santa Ana River. The District maintains ten primary hydraulic "pressure zones" and fourteen water storage reservoirs. Almost ten years ago the District began a $95 million dollar “fast track” capital improvement program aimed at an infrastructural overhaul to ensure water reliability for our customers, and to meet current and anticipated consumption and financial demands. The program includes the construction of water wells, reservoirs, pipelines and booster pumping stations as well as various other system improvements. These systems improvements will allow greater access to groundwater throughout our service area and have the potential to reduce variable costs approximately $1 million per year. In addition, the ability to access groundwater provided by these upgrades serves to better prepare the District in the event of scheduled and unscheduled MWD shutdowns. Historically, YLWD rates have been among the lowest in Orange County, and continue to be so for the upcoming year. In fiscal year 2012/13 and 2013/14, the District purchased 21,788.7 acre-feet and 22,645.8 acre-feet of water to provide to customers, respectively. Fiscal year 2015/16 is forecasted to provide 16,534 acre-feet. ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 18 Personnel Trends by Position Changes and Trends: The part-time Public Information Assistant has now been replaced by a full time Public Affairs Representative. In response to the Emergency Drought Declaration by the State the following limited-term positions have been added: a full-time Water Conservation Supervisor and 4 part-time Water Conservation Representatives. Position/Title 2011-122012-132013-14 2014-15 Proposed 2015-16 ADMINISTRATION Executive Secretary1 1 1 1 1 General Manager1 1 1 1 1 Legislative Affairs Intern 0.5 0.5 --- Management Analyst1 1 1 1 1 Public Affairs Intern0.5 0.5 0.5 -- Public Affairs Representative----1 Public Information Assistant---0.5 - Public Information Manager1 1 1 1 1 Records Management Clerk --0.5 -- Records Management Spec ialist ---1 - W ater Conservation Representative ##----2 W ater Conservation Supervisor #----1 Total Administration 5.0 5.0 5.0 5.5 8 ENGINEERING Associate Engineer---1 1 Contruction Inspector1 1 1 1 1 Contruction Project Supervisor--1 1 1 Engineering Manager1 1 1 1 1 Engineering Secretary1 1 1 -- Engineering Technician II2 2 2 2 2 Project Coordinator--1 -- Project Engineer2 2 --- Senior Construction Inspector1 1 1 1 1 Senior Project Manager1 1 1 1 1 Water Quality Engineer1 1 1 1 1 Water Quality Technician II 1 1 1 1 1 Total Engineering 11 11 11 10 10 # Limited-term position in response to Emergency Declaration of Drought by State ## Limited-term positions in response to Emergency Declaration of Drought by State - Enforcement Staff ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 19 Changes and Trends: The Human Resources Technician has been promoted to a Human Resources Analyst. A Records Management Administrator was added for FY 2015-16. The Records Management Specialist was reassigned to the Human Resources Department. The SCADA Administrator and Instrumentation Technician were reassigned from the IT Department to the Operations Department. Position/Title 2011-122012-132013-14 2014-15 Proposed 2015-16 FINANCE Accounting Assistant I1 1 1 1 1 Accounting Assistant II1 1 1 1 1 Customer Service Rep I1 1 1 -- Customer Service Rep II1 1 1 2 2 Customer Service Rep III2 2 2 2 2 Customer Service Supervisor1 1 1 1 1 Finance Director----- Finance Manager1 1 1 1 1 Meter Reader I2 2 2 1 1 Meter Reader II2 2 2 2 2 Meter Services Lead1 1 1 1 1 Senior Accountant1 1 1 1 1 Total Finance 14 14 14 13 13 HUMAN RESOURCES Human Resources Analyst1 1 1 1 2 Human Resources Clerk--0.5 -- Human Resource & Risk Manager1 1 1 1 1 Human Resource Technician--1 1 - Personnel Technician1 1 --- Records Management Administrator----1 Records Management Specialist #----1 Safety Training Technician --1 1 1 Total Human Resources 3 3 4.5 4.0 6.0 INFORMATION TECHNOLOGY GIS Administrator1 1 1 -- GIS Analyst---1 1 GIS Technician0.5 0.5 0.5 -- Information Systems Administrator1 1 1 1 1 Information Systems Technician I1 1 1 1 1 Information Systems Technician II1 1 --- Instrumentation Technician1 1 1 1 - IT Manager1 1 1 1 1 SCADA Administrator 1 1 1 1 - Programmer Analyst --1 1 1 Total Information Technology 6.5 6.5 7.5 7.0 5.0 # Records Management Specialist reassigned to Human Resources Department for FY 2015/16. ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 20 Changes and Trends: The SCADA Administrator and Instrumentation Technician were reassigned from the IT to the Operations Department in FY 2015/16. Position/Title 2011-122012-132013-14 2014-15 Proposed 2015-16 OPERATIONS Chief Plant Operator1 1 1 -- Facilities Maintenance1 1 1 1 1 Instrumentation Technician----1 Maintenance Distribution Operator II8 8 8 8 8 Maintenance Distribution Operator III4 4 4 4 4 Maintenance Worker I9 9 9 9 9 Mechanic II1 1 1 1 1 Mechanic III1 1 1 1 1 Office Clerk---1 1 Operations Assistant--1 -- Operations/ Warehouse Assistant---1 1 Operations Assistant/Storekeeper1 1 --- Operations Manager1 1 1 1 1 Plant Operator II3 3 3 3 3 SCADA Administrator ----1 Sr Maintenance Distribution Operator4 4 4 4 4 Senior Fleet Mechanic1 1 1 1 1 Senior Plant Operator1 1 1 1 1 Water Maintenance Superintendant1 1 1 1 1 Water Production Superintendant- - - 1 1 Total Operations 37 37 37 38 40 # SCADA Administreator and Instrumentation Technician reassigned to Operations Department from IT Department for FY 2015/16. DISTRICT TOTAL (FTE)76.5 76.5 79.0 77.5 82.0 ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 21 Personnel Trends by Department Department2011-12 2012-132013-14 2014-15 Proposed 2015-16 Administration5555.58 Engineering1111111010 Finance1414141313 Human Resources334.546 Information Technology7.57.57.575 Operations3737373840 DISTRICT DEPARTMENT TOTALS77.577.57977.582 ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 22 Financial Policies & Goals This section includes a brief summary of the District’s Operating Budget Policy, Revenue and Expenditure Policy, Reserve Policy, and Investment Policy. Though each financial policy is reviewed annually, only the District’s Investment Policy is updated and adopted by the Board on an annual basis. Operating Budget Policy The District’s budget is developed in accordance with the priorities which are linked to the District’s financial and strategic plans set forth in the District’s mission and long-term goals and objectives. These are found in the District’s comprehensive master plans, the long term financial plan, the needs of the community, and federal and state laws. The District operating and capital budget is developed on an annual basis. Operating and capital appropriations are approved by the District’s Board of Director’s. A balanced budget is defined as the amount of budgeted expenditures is equal to or less than the amount of budgeted revenue, plus available fund balance. The accounting for the District is kept on an accrual basis. Revenues are recognized when earned, and expenses are recognized when incurred. The budgeting for District expenses, with the exception of supplies and services, is on an accrual basis. Supplies and services are budgeted on a cash basis. The District is operated as an enterprise fund, an accounting entity which finances and accounts for the acquisition, operation, and maintenance of governmental facilities and services. It is the intention of the District to recover the full costs of providing maintenance, goods, and/or services through the collection of user charges. Revenue and Expenditure Policy Budgeted revenues are estimated conservatively using an objective and analytical approach using historical trends and current information to maintain consistency, reliability, and reasonableness. The District’s expenditures reflect the Board of Directors’ and staff commitment to serve present and future customers with reliable public services. The Board and staff believe that prudent expenditure planning and accountability will ensure fiscal stability. Budgeted expenditures are projected conservatively using an objective and analytical approach as well as certain techniques such as historical trends, current information, and economic indicators to maintain consistency, reliability, and reasonableness. ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 23 Reserve Policy This policy represents the public affirmation of the Board’s commitment to the financial prudence and careful stewardship of community assets. This policy covers: Operating Reserve (target level of 8%-17% of annual operating budget); Emergency Reserve (target level between $1 and $4 million for water fund and $250,000 and $1 million for sewer fund); Capital Replacement Reserve (target level of $1.82 million for water fund less money set aside for Maintenance Reserve and $345,000 for sewer fund); Maintenance Reserve (target level of $200,000); Debt Service Reserve (target level of highest annual debt service payment); Employee Liabilities Reserve (annual contribution of $100,000) and US Bank 2008 COP Reserve (target level of $2,147,096). These funds are designated by the District’s Board to carry out specific purposes to ensure prudent management of District’s financial resources and are used by District’s staff as parameters within which the Board expects staff to operate. The Financial Reserve Policy has three primary goals:  To preserve the financial stability of the District against present and future uncertainties in an ever-changing environment  To maintain the District’s bond ratings in the capital markets and sustaining debt covenant compliance  To provide adequate funding to meet the District’s short-term and long-term plans and commitments to its customers All reserve balances will be subject to review by the Board of Directors on an annual basis as part of the budget process. Investment Policy It is the policy of the District to invest funds in a manner that will provide the highest investment return with the maximum security while meeting the daily cash flow demands of the District and conforming to all statutes governing the investment of the District funds. The policy follows the “prudent investor” standard of the California Government Code Section 53600.3 and is updated and formally adopted by the District on an annual basis. ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 24 Basis of Budgeting & Accounting The accounting for the District is kept on an accrual basis. Revenues are recognized when earned, and expenses are recognized when incurred. The budgeting for District expenses, with the exception of supplies and services, is on the accrual basis. Supplies and services are budgeted on the cash basis of accounting. The District is operated as an enterprise fund, which is an accounting entity that finances and accounts for the acquisition, operation and maintenance of governmental facilities and services. It is the District’s intention to recover the majority of the costs of the acquisition, operation, and maintenance of governmental facilities through user- charges and the receipt of property taxes. Budget Controls When the Fiscal Year 2015-16 Operating and Capital Budget is approved by the Board, budgeted amounts are appropriated and expended within each department. Subject to the approval of the annual budget by the Board of Directors, the General Manager has full charge and control of the District’s expenditures to ensure that operating and capital expenditures in each fiscal year are within the budgetary guidelines and to ensure that the District’s goals and objectives are met. Developing and monitoring the budget is an ongoing process. Monthly reports of expenses and revenues compared to the budget are developed to provide a method for ongoing review at the department. The Board is presented unaudited financial statements in the CAFR format to review, receive and file for each reporting quarter. Throughout the year, Finance and other department managers will review actual results of operating expenditures as compared to the budgeted amounts approved by the Board of Directors in June 2015. The General Manager has the authority to make administrative adjustments to the budget as long as those changes will not have a significant policy impact nor affect the budgeted year-end fund balances. Any significant program changes or service level changes require approval by the Board of Directors. All budget transfers are documented and tracked within the Finance Department. Review and adjustments to the capital budget appropriations are also recommended throughout the fiscal year. Project managers may find that some projects contemplated at the beginning of the fiscal year have been delayed or accelerated due to changes in conditions, weather and/or economics, and new projects may be added to meet future demands, goals and objectives. Any recommended changes to the Capital Improvement Budget would be brought to the Board of Directors for approval. ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 25 Resolutions adopted by the Board of Directors are required for authorizing positions in the service of the District and for setting salary ranges for those authorized positions. The General Manager is authorized to use savings from vacant authorized positions to retain contract labor to meet District personnel needs. The General Manager is also authorized to fill an approved and budgeted position that is vacated during the term of the budget year with a new employee at an equal or lower classification. The budget may need to be modified to reflect labor and benefit agreements. These changes would be approved by the Board of Directors. As defined by the District’s Purchasing Policy, in the event that the General Manager determines that an emergency exists and requires immediate action, the General Manager shall have the power, without prior Board action, to enter into contracts and agreements and expend funds on behalf of the District beyond the final approved fiscal year budget in an amount not to exceed $100,000. Those amounts shall be ratified at the next meeting or at the earliest special meeting that can be called. Amounts in excess of $100,000 require Board of Director approval and shall be formally ratified at the next meeting or at the earliest special meeting that can be called. Budget Process The budget process begins in January of each year and is the product of a comprehensive team effort from various levels within the organization, as shown on the following Budget Calendar. Each year, the Finance Department prepares expenditure budget worksheets for distribution to key staff. These worksheets give staff the necessary information to project their department’s budgets by category. Included in the worksheets are the past year’s actual expenses, current year transactions, and projected current year end balances. Based on the information provided, and accounting for any changes for anticipated purchases, the requested amounts from the worksheet are entered into the budget system and compared to last year’s budget. Any substantial budget change needs to be justified by the respective departments. The Human Resources Department reviews the employee positions and wages of the District. The Human Resources Department makes a recommendation to the General Manager if new positions need to be added, changes in job descriptions need to occur, or reclassifications of position are required. The results of this review are presented to the Board of Directors for further input and approval. The approved personnel recommendations are entered into the budget system for inclusion in the budget document. ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 26 The Engineering Department prepares a list of CIP projects to be presented to the Board of Directors. Based on recommendations from staff, each CIP project will be prioritized based on necessity. The Engineering Department will also update the future project list and will incorporate cost changes due to construction cost increases or a change in the scope of the project. The method to determine the revenue projections takes into account factors such as projected growth, required conservation, historical activity, and the current economic conditions. Once all the components have been calculated, each department presents their departmental budget to the General Manager and Management Team for review. Comments and changes that are recommended by staff are included in a draft document that is then presented to the Board of Directors in a public forum for review and comment. Once all approved changes have been incorporated into the draft document, a final budget is then presented to the Board of Directors for adoption. Developing and monitoring the budget is an ongoing process. Monthly reports of expenses and revenues compared to the budget are developed to provide a method for ongoing review at the department level. The Board is presented unaudited financial statements in the CAFR format to review, receive and file for each reporting quarter. Revenue Assumptions The main source of Operating Revenue for the District is water and sewer rate revenue. However, rate revenue is not enough to fund the total cost of operations and must be supplemented by a variety of miscellaneous/other operating revenues. Other operating revenues include items such as customer service fees, unmetered jumpers, and other sources. Total operating revenues are projected to decrease at a rate of 1.2% in FY 2015/2016. Water operating revenues as a result of water sales are estimated to decrease by 1.9% to $28,623,519 in FY 2015/16. Sewer operating revenues are estimated to decrease by 1.2% to $1,822,139 in FY 2015/16. Water Operating Fund Potable Water sales are the largest source of District revenues, with the majority of sales to residential customers. In previous years, mild weather conditions, less that desirable economic conditions, and a strong water conservation message have resulted in lower consumption demand and thus lower than anticipated water revenues. In the current year, due to the Governor’s official Declaration of Drought and mandated conservation reduction for YLWD of 36%, comparative to calendar year 2013, set by the SWRCB, the District is budgeting for at a 29% conservation reduction of current forecasted usage. ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 27 There is no tiered water rate structure at YLWD. Therefore, Water Revenues are calculated using the average number of units consumed per customer account, a proposed monthly fixed charge per account, and a proposed $2.70 per billing unit consumed (which is 100 cubic feet (ccf) or approximately 750 gallons). The result is then annualized for the budget projection. The budget assumes a yearly demand of 16,534 acre feet (AF) in FY 2015/16. The chart below displays the historical trend of water revenue. Revenue from Service Charges is a calculation of the projected number of service connections for FY 2015/16 (24,703) multiplied by the proposed fixed service charge based on meter size. Other Income Revenues, which include but are not limited to backflow charges, unmetered jumpers, construction meters, new account fees, and other income, are projected based upon historical activity and current economic conditions. Included in Other Income Revenues for FY 2015/16, in response to the SWRCB’s Emergency Drought, are revenues collected in the form of administrative penalties imposed upon District customers who exceed water use restrictions. Interest Income for the water operating funds is projected based on an average yield of 0.6% on the District’s portfolio. Property Tax Income is projected based on the assumptions of the Orange County Tax Assessor. The District anticipates receiving 97% of its share of the ad valorem tax revenue, which will result in a 1% increase when compared to the previous year. ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 28 Other Non-Operating Revenue, which include but are not limited to annexation fees, rental income, and other sources, are projected based upon historical activity and current economic conditions. ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 29 Sewer Operating Fund The District’s Sewer Revenues are based on the sewer collection services provided to our customers. Sewer maintenance charges will remain fixed at $5.50 per month for single family residential customers with associated charges for multi-family and commercial accounts. The District will provide sewage collection services for approximately 25,300 sewer service connections. Other Income Revenues, which include but are not limited to sewer collection fees and miscellaneous income, are projected based upon the historical activity and current economic conditions. Interest Income for the sewer operating funds is projected based on an average yield of 0.6% on the District’s portfolio. ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 30 Cost Allocation The allocation of costs are derived from cost accounting. Cost accounting is defined as the process of tracking, recording and analyzing costs associated with the products or activities of an organization. The costs of operating expenses including employee wages and benefits are allocated to each department and division, based on actual expenses as tracked by the District’s accounting system. The District’s budget is presented with an allocation of 93% to the Water Fund and 7% to the Sewer Fund, with the exceptions of the Water Production, Water Operations, and Mechanical Services sections which are allocated 100% to the Water Fund. Additionally, the Sewer Operations section, which includes sewer-related expenses including vehicle maintenance, is allocated 100% to the Sewer Fund. The methodology used to determine the allocation percentages involved discussions with personnel from each department where they were to identify a basis for each section by which an allocation percentage could be used. This analysis concluded that the allocation percentage described above was appropriate. Costs associated with capital projects are tracked by the means of assigned “Job Numbers”. Salaries affiliated with capital projects are allocated to the appropriate CIP accounts based on actual timesheet entries. An overhead of approximately 33% is applied to the allocated salary costs by job number in order to provide a true salary and benefit cost applicable to CIP projects. ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 31 Chart of Major Funds Structure (FY 15/16) Water Sales Service Charges Property Tax Interest Income Other Income Sewer Service Charges Water Fund Sewer Fund District Operations & Maintenance Activities ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 1 FINANCIAL SUMMARIES ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 2 Total Revenue and Expenses (Water & Sewer) FY 2012/13 Actual FY 2013/14 Actual FY 2014/15 Budget FYE 2014/15 Forecast FY 2015/16 Budget Revenue (Operating): Water Revenue (Residential)16,596,680$ 17,502,293$ 17,154,552$ 15,909,458$ 11,472,028$ Water Revenue (Commercial & Fire Det.)1,890,269$ 1,984,096$ 2,074,097$ 1,941,531$ 1,385,979$ Water Revenue (Landscape/Irrigation)4,161,528$ 4,543,942$ 4,792,995$ 4,203,144$ 2,782,183$ Service Charges3,721,462$ 4,341,965$ 4,478,000$ 4,988,739$ 9,426,652$ Sewer Charge Revenue1,561,850$ 1,565,548$ 1,605,292$ 1,588,680$ 1,584,348$ Sewer Parcel Assessments200,189$ 201,054$ 201,000$ 194,895$ 201,500$ Other Operating Revenue723,577$ 1,047,625$ 719,777$ 1,298,393$ 3,592,969$ Total Operating Revenue28,855,555$ 31,186,523$ 31,025,713$ 30,124,841$ 30,445,658$ Revenue (Non-Operating): Interest137,569$ 145,048$ 112,000$ 144,679$ 93,000$ Property Tax1,340,916$ 1,394,722$ 1,283,642$ 1,454,342$ 1,395,000$ Other Non-Operating Revenue588,854$ 1,325,685$ 533,525$ 708,584$ 607,155$ Total Non-Operating Revenue2,067,339$ 2,865,455$ 1,929,167$ 2,307,604$ 2,095,155$ Total Revenue30,922,894$ 34,051,978$ 32,954,880$ 32,432,445$ 32,540,813$ Expenses (Operating): Variable Costs13,509,336$ 14,673,144$ 14,928,972$ 13,850,950$ 12,080,410$ $ Salary Related Expenses7,225,729$ 7,529,481$ 8,509,812$ 7,997,942$ 9,099,218$ Reduction for Capital Project Labor -$ -$ (285,000)$ (183,975)$ (135,000)$ Salary Related Expenses Total7,225,729$ 7,529,481$ 8,224,812$ 7,813,967$ 8,964,218$ Supplies & Services: Communications199,150$ 214,663$ 294,894$ 195,376$ 301,525$ Contractual Services476,369$ 567,131$ 560,700$ 501,014$ 586,155$ Data Processing133,426$ 158,102$ 186,830$ 160,331$ 233,829$ Dues & Memberships57,402$ 67,531$ 78,065$ 76,732$ 115,110$ Fees & Permits188,354$ 183,295$ 186,190$ 176,405$ 2,926,665$ Board Election-$ -$ 75,000$ -$ -$ Insurance257,274$ 271,117$ 313,340$ 262,518$ 296,340$ Materials752,538$ 714,625$ 658,125$ 700,876$ 795,950$ District Activities, Emp Recognition21,423$ 16,018$ 24,710$ 13,758$ 29,110$ Maintenance457,663$ 403,054$ 507,021$ 524,010$ 747,345$ Non-Capital Equipment182,845$ 138,443$ 152,000$ 135,632$ 167,750$ Office Expense42,343$ 41,465$ 40,475$ 41,452$ 42,850$ Professional Services906,818$ 532,899$ 711,610$ 479,211$ 644,710$ Training25,106$ 34,071$ 65,180$ 46,822$ 75,015$ Travel & Conferences25,461$ 29,453$ 46,500$ 39,084$ 114,730$ Uncollectible Accounts36,383$ 29,632$ 40,000$ 35,600$ 40,000$ Utilities92,333$ 38,201$ 90,800$ 81,402$ 90,850$ Vehicle Expenses367,510$ 409,483$ 358,400$ 356,998$ 372,433$ Supplies & Services Sub-Total4,222,398$ 3,849,183$ 4,389,840$ 3,827,221$ 7,580,367$ Total Operating Expenses24,957,463$ 26,051,808$ 27,543,624$ 25,492,138$ 28,624,995$ Expenses (Non-Operating): Interest Expense1,781,416$ 1,715,429$ 1,780,793$ 1,714,192$ 1,655,685$ Other Expense228,364$ 47,948$ 72,000$ 9,250$ 22,000$ Total Non-Operating Expenses2,009,780$ 1,763,377$ 1,852,793$ 1,723,442$ 1,677,685$ Total Expenses26,967,243$ 27,815,185$ 29,396,417$ 27,215,580$ 30,302,680$ Net Income Before Capital Contributions3,955,651$ 6,236,793$ 3,558,463$ 5,216,865$ 2,238,134$ Extraordinary Item-$ 5,000,000$ -$ -$ -$ Capital Contributions1,174,673$ 2,128,579$ -$ 80,212$ -$ Net Income Before Depreciation5,130,324$ 13,365,372$ 3,558,463$ 5,297,077$ 2,238,134$ Depreciation6,884,213$ 7,315,084$ 7,337,500$ 7,354,700$ 7,350,000$ Income (Loss)(1,753,889)$ 6,050,288$ (3,779,037)$ (2,057,622)$ (5,111,866)$ ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 3 Total Revenue and Expenses (Water & Sewer), Continued ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 4 Total Revenue and Expenses (Water) FY 2012/13 Actual FY 2013/14 Actual FY 2014/15 Budget FYE 2014/15 Forecast FY 2015/16 Budget Revenue (Operating): Water Revenue (Residential)16,596,680$ 17,502,293$ 17,154,552$ 15,909,458$ 11,472,028$ Water Revenue (Commercial & Fire Det.)1,890,269$ 1,984,096$ 2,074,097$ 1,941,531$ 1,385,979$ Water Revenue (Landscape/Irrigation)4,161,528$ 4,543,942$ 4,792,995$ 4,203,144$ 2,782,183$ Service Charges3,721,462$ 4,341,965$ 4,478,000$ 4,988,739$ 9,426,652$ Other Operating Revenue684,916$ 936,977$ 670,003$ 1,237,953$ 3,556,678$ Total Operating Revenue27,054,855$ 29,309,273$ 29,169,647$ 28,280,826$ 28,623,519$ Revenue (Non-Operating): Interest121,210$ 131,833$ 100,000$ 130,000$ 85,000$ Property Taxes1,340,916$ 1,394,722$ 1,283,642$ 1,454,342$ 1,395,000$ Other Non-Operating Revenue574,424$ 1,255,176$ 521,600$ 702,159$ 595,230$ Total Non-Operating Revenue2,036,550$ 2,781,731$ 1,905,242$ 2,286,500$ 2,075,230$ Total Revenue29,091,405$ 32,091,004$ 31,074,889$ 30,567,326$ 30,698,749$ Expenses (Operating): Variable Water Costs (G.W., Import & Power)13,509,336$ 14,673,144$ 14,928,972$ 13,850,950$ 12,080,410$ Salary Related Expenses6,390,207$ 6,728,455$ 7,628,522$ 7,018,668$ 8,238,352$ Reduction for Capital Project Labor -$ -$ (265,050)$ (165,000)$ (120,000)$ Salary Related Expenses Total6,390,207$ 6,728,455$ 7,363,472$ 6,853,668$ 8,118,352$ Supplies & Services Communications186,573$ 199,790$ 273,786$ 181,700$ 280,232$ Contractual Services442,969$ 528,149$ 521,451$ 465,924$ 545,124$ Data Processing124,249$ 146,497$ 173,752$ 149,108$ 217,461$ Dues & Memberships53,262$ 62,930$ 72,321$ 71,216$ 106,773$ Fees & Permits173,052$ 170,327$ 169,437$ 161,127$ 2,718,822$ Board Election-$ -$ 69,750$ -$ -$ Insurance242,338$ 249,605$ 291,406$ 244,142$ 275,596$ Materials734,474$ 634,634$ 579,369$ 630,630$ 690,479$ District Activities, Emp Recognition20,053$ 14,931$ 22,980$ 12,795$ 27,072$ Maintenance353,309$ 317,247$ 471,530$ 399,014$ 415,101$ Non-Capital Equipment164,430$ 120,883$ 132,525$ 107,307$ 138,338$ Office Expense39,441$ 34,729$ 37,642$ 38,550$ 39,851$ Professional Services876,546$ 508,378$ 672,197$ 448,372$ 544,350$ Training19,741$ 28,293$ 58,571$ 42,057$ 67,718$ Travel & Conferences23,883$ 27,639$ 42,129$ 36,348$ 103,518$ Uncollectible Accounts32,089$ 26,116$ 37,200$ 33,108$ 37,200$ Utilities85,903$ 35,103$ 83,700$ 75,030$ 83,700$ Vehicle Expenses318,240$ 346,351$ 281,139$ 278,077$ 300,328$ Supplies & Services Sub-Total3,890,552$ 3,451,602$ 3,990,886$ 3,374,504$ 6,591,663$ Total Operating Expenses23,790,095$ 24,853,201$ 26,283,331$ 24,079,123$ 26,790,426$ Expenses (Non-Operating) Interest on Long Term Debt1,781,416$ 1,715,429$ 1,780,793$ 1,714,192$ 1,655,685$ Other Expense228,364$ 47,948$ 72,000$ 9,250$ 22,000$ Total Non-Operating Expenses2,009,780$ 1,763,377$ 1,852,793$ 1,723,442$ 1,677,685$ Total Expenses25,799,875$ 26,616,578$ 28,136,123$ 25,802,565$ 28,468,110$ Net Income (Loss) Before Capital Contributions3,291,530$ 5,474,426$ 2,938,766$ 4,764,760$ 2,230,639$ Extra-Ordinary Item-$ 5,000,000$ -$ -$ -$ Capital Contributions711,319$ 1,235,502$ -$ 61,035$ -$ Net Income (Loss) Before Depreciation4,002,849$ 11,709,928$ 2,938,766$ 4,825,795$ 2,230,639$ Depreciation5,580,026$ 5,982,770$ 5,992,500$ 6,012,184$ 6,003,400$ Income (Loss)(1,577,177)$ 5,727,158$ (3,053,734)$ (1,186,388)$ (3,772,761)$ ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 5 Total Revenue and Expenses (Water), Continued ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 6 Total Revenue and Expenses (Sewer) FY 2012/13 Actual FY 2013/14 Actual FY 2014/15 Budget FYE 2014/15 Forecast FY 2015/16 Budget Revenue (Operating): Sewer Charge Revenue1,561,850$ 1,565,548$ 1,605,292$ 1,588,680$ 1,584,348$ Sewer Parcel Assessments200,189$ 201,054$ 201,000$ 194,895$ 201,500$ Other Operating Revenue38,661$ 110,648$ 49,774$ 60,440$ 36,291$ Total Operating Revenue1,800,700$ 1,877,250$ 1,856,066$ 1,844,015$ 1,822,139$ Revenue (Non-Operating): Interest16,359$ 13,215$ 12,000$ 14,679$ 8,000$ Other Non-Operating Revenue14,430$ 70,509$ 11,925$ 6,425$ 11,925$ Total Non-Operating Revenue30,789$ 83,724$ 23,925$ 21,104$ 19,925$ Total Revenue1,831,489$ 1,960,974$ 1,879,991$ 1,865,119$ 1,842,064$ Expenses (Operating): Variable Water Costs (G.W., Import & Power)-$ -$ -$ -$ -$ Salary Related Expenses835,522$ 801,026$ 881,290$ 979,273$ 860,865$ Reduction for Capital Project Labor -$ -$ (19,950)$ (18,975)$ (15,000)$ Salary Related Expenses Total835,522$ 801,026$ 861,340$ 960,298$ 845,865$ Supplies & Services Communications12,577$ 14,873$ 21,108$ 13,676$ 21,293$ Contractual Services33,400$ 38,982$ 39,249$ 35,090$ 41,031$ Data Processing9,177$ 11,605$ 13,078$ 11,223$ 16,368$ Dues & Memberships4,140$ 4,601$ 5,744$ 5,516$ 8,337$ Fees & Permits15,302$ 12,968$ 16,753$ 15,278$ 207,843$ Board Election-$ -$ 5,250$ -$ -$ Insurance14,936$ 21,512$ 21,934$ 18,376$ 20,744$ Materials18,064$ 79,991$ 78,756$ 70,247$ 105,472$ District Activities, Emp Recognition1,370$ 1,087$ 1,730$ 963$ 2,038$ Maintenance104,354$ 85,807$ 35,491$ 124,996$ 332,244$ Non-Capital Equipment18,415$ 17,560$ 19,475$ 28,325$ 29,413$ Office Expense2,902$ 6,736$ 2,833$ 2,902$ 3,000$ Professional Services30,272$ 24,521$ 39,413$ 30,838$ 100,360$ Training5,365$ 5,778$ 6,609$ 4,766$ 7,297$ Travel & Conferences1,578$ 1,814$ 4,371$ 2,736$ 11,212$ Uncollectible Accounts4,294$ 3,516$ 2,800$ 2,492$ 2,800$ Utilities6,430$ 3,098$ 7,100$ 6,372$ 7,150$ Vehicle Expenses49,270$ 63,132$ 77,261$ 78,921$ 72,105$ Supplies & Services Sub-Total331,846$ 397,581$ 398,954$ 457,922$ 988,704$ Total Operating Expenses1,167,368$ 1,198,607$ 1,260,293$ 1,418,220$ 1,834,569$ Expenses (Non-Operating): Interest Expense-$ -$ -$ -$ -$ Other Expense-$ -$ -$ -$ -$ Total Non-Operating Expenses-$ -$ -$ -$ -$ Total Expenses1,167,368$ 1,198,607$ 1,260,293$ 1,418,220$ 1,834,569$ Net Income (Loss) Before Capital Contributions664,121$ 762,367$ 619,698$ 446,899$ 7,495$ Transfer (To)/From-$ -$ -$ -$ -$ Capital Contributions463,354$ 893,077$ -$ 19,177$ -$ Net Income Before Depreciation1,127,475$ 1,655,444$ 619,698$ 466,076$ 7,495$ Depreciation1,304,187$ 1,332,314$ 1,345,000$ 1,342,516$ 1,346,600$ Income (Loss)(176,712)$ 323,130$ (725,302)$ (876,440)$ (1,339,105)$ ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 7 Total Revenue and Expenses (Sewer), Continued ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 8 Total Revenues by Fund Total Revenues FY 2012/13 Actual FY 2013/14 Actual FY 2014/15 Budget FY 2014/15 Forecast FY 2015/16 Budget Water Revenue 29,091,405$ 32,091,004$ 31,074,889$ 30,567,326$ 30,698,749$ Sewer Revenue1,831,489$ 1,960,974$ 1,879,991$ 1,865,119$ 1,842,064$ Total Operating Revenue:30,922,894$ 34,051,978$ 32,954,880$ 32,432,445$ 32,540,813$ ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 9 Total Expenses by Fund FY 2012/13 Actual FY 2013/14 Actual FY 2014/15 Budget FY 2014/15 Forecast FY 2015/16 Budget Water$25,799,875 $26,616,578$28,136,123$25,802,565 $28,468,110 Sewer$1,167,368 $1,198,607 $1,260,293 $1,413,015 $1,834,569 Total Operating Expenses:$26,967,243 $27,815,185 $29,396,417$27,215,580$30,302,680 Note: Depreciation Not Included ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 10 Total Expenses by Category Five Year Cost Comparison ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 11 Variable Water Cost Expenses Note: The Variable Water Costs category is the largest component of the FY 2015/16 Budgeted Operating Costs and includes imported and groundwater purchases, as well as power costs associated with pumping water throughout the District. These costs are listed in the Total Water Revenues and Expenses and Water Revenues and Expenses schedules on pages 56 and 58, respectively. ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 12 Reserves & Funding Sources Restriction Category Balance Ending 6/30/2014 Balance Ending 5/31/2015 Forecast Balance Ending 6/30/2015 Additions (Deductions) FYE 2015/16 Budgeted Balalnces Ending 6/30/2016 Water (Operating): Operating FundOperating Reserve3,136,962 4,105,782 4,395,782 (125,565) 4,270,217 Reserve for Debt ServiceDebt Service Payment2,730,024 3,500,427 3,500,472 (776,963) 2,723,509 Employee LiabilitiesOPEB and Comp Abs.186,070 186,301 186,306 92,694 279,000 Water (Capital) Water EmergencyEmergency Reserve1,010,940 1,026,157 1,026,207 (26,207) 1,000,000 Water Capital ProjectsCapital Reserve16,676,503 17,373,484 17,393,484 (1,394,597) 15,998,887 COP Bond 2008 - ReserveRestricted from Use*2,152,324 2,180,272 2,152,320 - 2,152,320 Water MaintenanceCapital Reserve200,000 150,613 200,000 - 200,000 Sewer (Operating): Operating FundOperating Reserve160,489 396,611 434,611 (159,426) 275,185 Employee LiabilitiesOPEB and Comp Abs.14,006 14,023 14,018 6,982 21,000 Sewer (Capital) Sewer EmergencyEmergency Reserve1,010,396 1,018,571 1,018,596 (18,596) 1,000,000 Sewer Capital ProjectsCapital Reserve2,127,063 2,236,864 2,236,904 (213,465) 2,023,439 Total of Funds29,404,777$ 32,189,105$ 32,558,700$ (2,615,144)$ 29,943,557$ *Amount has been set aside by the fiscal agent in a reserve fund, and is unable to be spent down Funding Sources ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 13 Projected Reserves & Funding Levels ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 14 Five Year Financial Projections (FY 2016-2020) Narrative This financial projection is designed to provide a general understanding of how revenues and expenditures are expected to influence the District over the next five years. Revenue and expenditure projections are reviewed in relation to their effect on funding capital projects, reserve levels, and operating fund balances. The District will update its projections on an annual basis in order to plan for the future and determine recommended rates. The projection factors in debt ratios, reserve balances, projected rate increases, cost increases and growth projections. The assumptions in the following projections include:  Costs passed-through for all variable water cost rate increases  Annexation to OCWD in FY 14/15  $7 million borrowing through a Line of Credit in FY 12/13 at an interest rate of One Month LIBOR + 0.90%, with renewals every 3 years  Principal repayment due September 16, 2016  A 0.04% annual growth in customer accounts  No change to the sewer rate, but an alignment to address a disparity in our rates in FY 2015/16  Average interest earnings at 0.3 % - 1.2%  1% growth in property taxes  1.5% annual increase in other non-operating revenue other than annexation amortization  9% annual increases in variable water costs  8% annual increases in salary related expenses  3-8% annual increases in supplies and services expenses with the following exceptions:  Board Election expense only budgeted every other year  Interest expense equal to those scheduled by the existing bonds and assumed interest rate of 1.5-2.0% for Line of Credit  No change to future budgets for other non-operating expenses  Depreciation increases based on the projected completion of CIP jobs The District is still in the middle of an aggressive CIP spending plan that was created with the issuance of the 2008 Certificates of Participation. The following projections include the completion of that spending plan. ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 15 Five Year Financial Projections Water & Sewer FY 2015/16 Budget FY 2016/17 Budget FY 2017/18 Budget FY 2018/19 Budget FY 2019/20 Budget Revenue (Operating): Water Revenue (Residential)11,472,028$ 11,816,189$ 12,288,836$ 13,026,167$ 13,807,737$ Water Revenue (Commercial & Fire Det.)1,385,979$ 1,427,558$ 1,484,660$ 1,573,740$ 1,668,164$ Water Revenue (Landscape/Irrigation)2,782,183$ 2,865,648$ 2,980,274$ 3,159,090$ 3,348,636$ Service Charges9,426,652$ 9,945,118$ 10,591,550$ 11,280,001$ 12,013,201$ Sewer Charge Revenue1,584,348$ 1,631,879$ 1,680,835$ 1,731,260$ 1,783,198$ Sewer Parcel Assessments201,500$ 201,500$ 201,500$ 201,500$ 201,500$ Other Operating Revenue3,592,969$ 809,763$ 831,383$ 877,752$ 935,385$ Total Operating Revenue30,445,658$ 28,697,654$ 30,059,040$ 31,849,510$ 33,757,821$ Revenue (Non-Operating): Interest93,000$ 96,570$ 112,151$ 136,774$ 148,400$ Property Tax1,395,000$ 1,408,950$ 1,423,040$ 1,437,270$ 1,451,643$ Other Non-Operating Revenue607,155$ 624,728$ 658,410$ 725,774$ 784,718$ Total Non-Operating Revenue2,095,155$ 2,130,248$ 2,193,601$ 2,299,819$ 2,384,761$ Total Revenue32,540,813$ 30,827,902$ 32,252,641$ 34,149,329$ 36,142,581$ Expenses (Operating): Variable Water Costs12,080,410$ 13,167,647$ 14,352,735$ 15,644,481$ 17,052,485$ Salary Related Expenses8,964,218$ 9,434,302$ 9,906,017$ 10,401,318$ 10,921,384$ Supplies & Services: Communications301,525$ 316,601$ 326,099$ 332,852$ 339,746$ Contractual Services586,155$ 615,463$ 633,927$ 647,049$ 666,460$ Data Processing233,829$ 245,520$ 257,796$ 270,325$ 283,470$ Dues & Memberships115,110$ 92,162$ 94,093$ 96,065$ 98,079$ Fees & Permits2,926,665$ 237,998$ 245,138$ 252,391$ 259,858$ Board Election-$ 50,000$ -$ 75,000$ -$ Insurance296,340$ 311,157$ 326,715$ 343,051$ 360,203$ Materials795,950$ 804,248$ 751,125$ 766,964$ 789,973$ District Activities, Emp Recognition29,110$ 30,566$ 31,198$ 31,844$ 32,800$ Maintenance747,345$ 705,962$ 624,141$ 642,865$ 662,151$ Non-Capital Equipment167,750$ 165,638$ 138,659$ 141,750$ 144,913$ Office Expense42,850$ 44,993$ 46,342$ 47,733$ 49,165$ Professional Services644,710$ 514,196$ 478,121$ 492,465$ 502,239$ Training75,015$ 76,734$ 78,346$ 79,991$ 81,672$ Travel & Conferences114,730$ 91,861$ 89,467$ 91,377$ 93,330$ Uncollectible Accounts40,000$ 25,025$ 20,703$ 18,356$ 17,589$ Utilities90,850$ 95,393$ 98,254$ 101,202$ 104,238$ Vehicle Equipment372,433$ 391,055$ 402,786$ 414,870$ 427,316$ Supplies & Services Sub-Total7,580,367$ 4,814,570$ 4,642,912$ 4,846,150$ 4,913,201$ Total Operating Expenses28,624,995$ 27,416,519$ 28,901,664$ 30,891,949$ 32,887,069$ Expenses (Non-Operating): Interest Expense1,655,685$ 1,726,884$ 1,684,309$ 1,638,509$ 1,638,509$ Other Expense22,000$ 22,000$ 22,000$ 22,000$ 22,000$ Total Non-Operating Expenses1,677,685$ 1,748,884$ 1,706,309$ 1,660,509$ 1,660,509$ Total Expenses30,302,680$ 29,165,403$ 30,607,973$ 32,552,458$ 34,547,578$ Net Income (Loss) Before Depreciation2,238,134$ 1,662,499$ 1,644,668$ 1,596,871$ 1,595,003$ Depreciation7,350,000$ 7,591,895$ 7,762,366$ 7,864,058$ 7,986,891$ Income (Loss)(5,111,866)$ (5,929,396)$ (6,117,698)$ (6,267,187)$ (6,391,888)$ ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 16 Five Year Financial Projections Water FY 2015/16 Budget FY 2016/17 Budget FY 2017/18 Budget FY 2018/19 Budget FY 2019/20 Budget Revenue (Operating): Water Revenue (Residential)11,472,028$ 11,816,189$ 12,288,836$ 13,026,167$ 13,807,737$ Water Revenue (Commercial & Fire Det.)1,385,979$ 1,427,558$ 1,484,660$ 1,573,740$ 1,668,164$ Water Revenue (Landscape/Irrigation)2,782,183$ 2,865,648$ 2,980,274$ 3,159,090$ 3,348,636$ Service Charges9,426,652$ 9,945,118$ 10,591,550$ 11,280,001$ 12,013,201$ Other Operating Revenue3,556,678$ 768,028$ 783,389$ 822,558$ 871,912$ Total Operating Revenue28,623,519$ 26,822,542$ 28,128,710$ 29,861,556$ 31,709,649$ Revenue (Non-Operating): Interest85,000$ 88,250$ 102,500$ 125,000$ 135,625$ Property Tax1,395,000$ 1,408,950$ 1,423,040$ 1,437,270$ 1,451,643$ Other Non-Operating Revenue595,230$ 611,015$ 641,268$ 701,775$ 754,719$ Total Non-Operating Revenue2,075,230$ 2,108,215$ 2,166,808$ 2,264,045$ 2,341,987$ Total Revenue30,698,749$ 28,930,756$ 30,295,517$ 32,125,601$ 34,051,636$ Expenses (Operating): Variable Water Costs12,080,410$ 13,167,647$ 14,352,735$ 15,644,481$ 17,052,485$ Salary Related Expenses8,118,352$ 8,520,767$ 8,946,806$ 9,394,146$ 9,863,853$ Supplies & Services: Communications280,232$ 294,244$ 303,071$ 309,133$ 315,315$ Contractual Services545,124$ 572,380$ 589,552$ 601,343$ 619,383$ Data Processing217,461$ 228,334$ 239,751$ 251,738$ 264,325$ Dues & Memberships106,773$ 83,409$ 85,077$ 86,778$ 88,514$ Fees & Permits2,718,822$ 19,764$ 20,356$ 20,865$ 21,387$ Board Election-$ 46,500$ -$ 69,750$ -$ Insurance275,596$ 289,376$ 303,845$ 319,037$ 334,989$ Materials690,479$ 725,002$ 669,502$ 682,893$ 703,379$ District Activities, Emp Recognition27,072$ 28,426$ 28,994$ 29,574$ 30,462$ Maintenance415,101$ 435,856$ 345,932$ 356,310$ 366,999$ Non-Capital Equipment138,338$ 134,754$ 106,849$ 108,986$ 111,166$ Office Expense39,851$ 41,843$ 43,098$ 44,391$ 45,723$ Professional Services544,350$ 440,318$ 402,027$ 414,088$ 421,511$ Training67,718$ 69,072$ 70,454$ 71,863$ 73,300$ Travel & Conferences103,518$ 80,089$ 77,341$ 78,888$ 80,466$ Uncollectible Accounts37,200$ 22,085$ 17,675$ 15,237$ 14,376$ Utilities83,700$ 87,885$ 90,522$ 93,237$ 96,034$ Vehicle Equipment300,328$ 315,344$ 324,804$ 334,549$ 344,585$ Supplies & Services Sub-Total6,591,663$ 3,914,681$ 3,718,852$ 3,888,661$ 3,931,914$ Total Operating Expenses26,790,426$ 25,603,095$ 27,018,392$ 28,927,288$ 30,848,252$ Expenses (Non-Operating): Interest Expense1,655,685$ 1,726,884$ 1,684,309$ 1,638,509$ 1,638,509$ Other Expense22,000$ 22,000$ 22,000$ 22,000$ 22,000$ Total Non-Operating Expenses1,677,685$ 1,748,884$ 1,706,309$ 1,660,509$ 1,660,509$ Total Expenses28,468,110$ 27,351,979$ 28,724,701$ 30,587,797$ 32,508,761$ Net Income (Loss) Before Depreciation2,230,639$ 1,578,777$ 1,570,816$ 1,537,805$ 1,542,875$ Depreciation6,003,400$ 6,240,295$ 6,407,891$ 6,507,247$ 6,629,580$ Income (Loss)(3,772,761)$ (4,661,518)$ (4,837,075)$ (4,969,442)$ (5,086,705)$ Debt Service Coverage 1.25 1.22 1.15 1.12 1.14 ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 17 Five Year Financial Projections Sewer FY 2015/16 Budget FY 2016/17 Budget FY 2017/18 Budget FY 2018/19 Budget FY 2019/20 Budget Revenue (Operating): Sewer Charge Revenue1,584,348$ 1,631,879$ 1,680,835$ 1,731,260$ 1,783,198$ Sewer Parcel Assessments201,500$ 201,500$ 201,500$ 201,500$ 201,500$ Other Operating Revenue36,291$ 41,735$ 47,995$ 55,194$ 63,473$ Total Operating Revenue1,822,139$ 1,875,113$ 1,930,330$ 1,987,954$ 2,048,171$ Revenue (Non-Operating): Interest8,000$ 8,320$ 9,651$ 11,774$ 12,775$ Other Non-Operating Revenue11,925$ 13,714$ 17,142$ 23,999$ 29,999$ Total Non-Operating Revenue19,925$ 22,034$ 26,793$ 35,774$ 42,774$ Total Revenue1,842,064$ 1,897,147$ 1,957,123$ 2,023,728$ 2,090,945$ Expenses (Operating): Salary Related Expenses845,865$ 913,535$ 959,211$ 1,007,172$ 1,057,531$ Supplies & Services: Communications21,293$ 22,357$ 23,028$ 23,719$ 24,431$ Contractual Services41,031$ 43,082$ 44,375$ 45,706$ 47,077$ Data Processing16,368$ 17,186$ 18,046$ 18,587$ 19,145$ Dues & Memberships8,337$ 8,754$ 9,016$ 9,287$ 9,565$ Fees & Permits207,843$ 218,235$ 224,782$ 231,525$ 238,471$ Board Election-$ 3,500$ -$ 5,250$ -$ Insurance20,744$ 21,781$ 22,870$ 24,014$ 25,214$ Materials105,472$ 79,245$ 81,622$ 84,071$ 86,593$ District Activities, Emp Recognition2,038$ 2,140$ 2,204$ 2,270$ 2,338$ Maintenance332,244$ 270,106$ 278,210$ 286,556$ 295,153$ Non-Capital Equipment29,413$ 30,883$ 31,810$ 32,764$ 33,747$ Office Expense3,000$ 3,149$ 3,244$ 3,341$ 3,442$ Professional Services100,360$ 73,878$ 76,094$ 78,377$ 80,728$ Training7,297$ 7,662$ 7,892$ 8,129$ 8,372$ Travel & Conferences11,212$ 11,772$ 12,125$ 12,489$ 12,864$ Uncollectible Accounts2,800$ 2,940$ 3,028$ 3,119$ 3,213$ Utilities7,150$ 7,508$ 7,733$ 7,965$ 8,204$ Vehicle Equipment72,105$ 75,711$ 77,982$ 80,321$ 82,731$ Supplies & Services Sub-Total988,704$ 899,889$ 924,060$ 957,489$ 981,287$ Total Operating Expenses1,834,569$ 1,813,424$ 1,883,271$ 1,964,661$ 2,038,817$ Expenses (Non-Operating): Other Expense-$ -$ -$ -$ -$ Total Non-Operating Expenses-$ -$ -$ -$ -$ Total Expenses1,834,569$ 1,813,424$ 1,883,271$ 1,964,661$ 2,038,817$ Net Income (Loss) Before Depreciation7,495$ 83,723$ 73,852$ 59,067$ 52,128$ Depreciation1,346,600$ 1,351,600$ 1,354,475$ 1,356,811$ 1,357,311$ Income (Loss)(1,339,105)$ (1,267,877)$ (1,280,623)$ (1,297,744)$ (1,305,183)$ ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 18 Five Year Financial Projections Reserve Balances- Water FY 2015/16 Budget FY 2016/17 Budget FY 2017/18 Budget FY 2018/19 Budget FY 2019/20 Budget Operating Reserves Ending Balance4,270,217$ 4,102,797$ 4,308,705$ 4,588,170$ 4,876,314$ Minimum Balance2,143,234$ 2,048,248$ 2,161,471$ 2,314,183$ 2,467,860$ Maximum Balance4,839,579$ 4,649,836$ 4,883,199$ 5,199,925$ 5,526,489$ Capital Replacement Reserves Ending Balance15,998,887$ 8,998,887$ 1,820,000$ 1,820,000$ 1,820,000$ Minimum Balance*1,820,000$ 1,820,000$ 1,820,000$ 1,820,000$ 1,820,000$ Maintenance Reserves Ending Balance200,000$ 200,000$ 200,000$ 200,000$ 200,000$ Minimum Balance200,000$ 200,000$ 200,000$ 200,000$ 200,000$ Emergency Reserves Ending Balance1,000,000$ 1,000,000$ 1,000,000$ 1,000,000$ 1,000,000$ Minimum Balance1,000,000$ 1,000,000$ 1,000,000$ 1,000,000$ 1,000,000$ Debt Service Reserves Ending Balance2,723,509$ 2,723,509$ 2,723,509$ 2,723,509$ 2,723,509$ Minimum Balance2,723,509$ 2,723,509$ 2,723,509$ 2,723,509$ 2,723,509$ COP Reserves Ending Balance2,152,320$ 2,147,096$ 2,147,096$ 2,147,096$ 2,147,096$ Minimum Balance2,147,096$ 2,147,096$ 2,147,096$ 2,147,096$ 2,147,096$ Employee Benefit Liability Reserves Ending Balance279,000$ 372,000$ 465,000$ 558,000$ 651,000$ Minimum Balance*93,000$ 93,000$ 93,000$ 93,000$ 93,000$ Total Water Reserves ##########7,934,644$ 6,509,979$ (742,464)$ (751,145)$ Ending Balance26,623,932$ 19,544,289$ 12,664,310$ 13,036,775$ 13,417,919$ Minimum Balance10,126,839$ 10,031,853$ 10,145,076$ 10,297,788$ 10,451,465$ Maximum Balance *Minimum Balance is actually minimum annual funding ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 19 Five Year Financial Projections Reserve Balances- Sewer FY 2015/16 Budget FY 2016/17 Budget FY 2017/18 Budget FY 2018/19 Budget FY 2019/19 Budget Operation Reserves Ending Balance275,185$ 272,014$ 282,491$ 294,699$ 305,823$ Minimum Balance146,766$ 145,074$ 150,662$ 157,173$ 163,105$ Maximum Balance311,877$ 308,282$ 320,156$ 333,992$ 346,599$ Capital Replacement Reserves Ending Balance2,023,439$ 1,622,939$ 1,622,939$ 1,622,939$ 1,622,939$ Minimum Balance*345,000$ 345,000$ 345,000$ 345,000$ 345,000$ Emergency Reserves Ending Balance1,000,000$ 1,000,000$ 1,000,000$ 1,000,000$ 1,000,000$ Minimum Balance250,000$ 250,000$ 250,000$ 250,000$ 250,000$ Employee Liability Reserves Ending Balance21,000$ 28,000$ 35,000$ 42,000$ 49,000$ Minimum Balance14,000$ 14,000$ 14,000$ 14,000$ 14,000$ Total Sewer Reserves (725,965)$ 363,883$ (110,350)$ (112,081)$ (110,996)$ Ending Balance3,319,624$ 2,922,952$ 2,940,429$ 2,959,638$ 2,977,761$ Minimum Balance755,766$ 754,074$ 759,662$ 766,173$ 772,105$ *Minimum Balance is actually minimum annual funding ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 20 Fund Balance History (FYE 2012-2016) Fiscal YearWaterSewer EndingFundsFundTotal 06/30/12Net Income Before Capital Contributions (1,119,927)(287,672)(1,407,599) Capital Contributions98,24117,115,89817,214,139 Transfers In (Out)(85,111)85,1110 Extraordinary Item (5,000,000)- (5,000,000) Fund Balance @ 6/30/2012122,238,503$ 42,803,710$ 165,042,213$ 06/30/13Net Income Before Capital Contributions (2,288,495)(640,066)(2,928,561) Capital Contributions711,319463,3541,174,673 Prior Period Adjustment (1,561,743)- (1,561,743) Fund Balance @ 6/30/2013119,099,584$ 42,626,998$ 161,726,582$ 06/30/14Net Income(Loss) Before Capital Contributions (508,344)(569,947)(1,078,291) Capital Contributions1,235,502893,0772,128,579 Extraordinary Item5,000,000- 5,000,000 Net Income(Loss) FY 20145,727,158323,1306,050,288 Fund Balance @ 6/30/2014124,826,742$ 42,950,128$ 167,776,870$ 06/30/15Revenue (Operating): Water Sales27,042,873- 27,042,873 Sewer Revenues- 1,783,5751,783,575 Other Operating Revenue1,237,95360,4401,298,393 Interest130,00014,679144,679 Property Taxes1,454,342- 1,454,342 Other Non-Operating Revenue702,1596,425708,584 Total Estimated Revenues FY201530,567,3261,865,11932,432,445 Expenses (Operating): Variable Water Costs (G.W., Import & Power)13,850,950 - 13,850,950 Salary Related Expenses6,853,668 960,298 7,813,967 Supplies & Services3,374,504 452,717 3,827,221 Depreciation6,012,184 1,342,516 7,354,700 Interest on Long Term Debt1,714,192 - 1,714,192 Other Expense9,250 - 9,250 Total Estimated Expenses FY201531,814,749 2,755,531 34,570,280 Net Income(Loss) Before Capital Contributions (1,247,423)(890,411)(2,137,834) Capital Contributions61,03519,17780,212 Net Income (Loss) FY 2015 (1,186,388)(871,234)(2,057,622) Estimated Fund Balance @ 6/30/2015123,640,353$ 42,078,894$ 165,719,247$ 06/30/16Revenue (Operating): Water Sales25,066,841- 25,066,841 Sewer Revenues- 1,785,8481,785,848 Other Operating Revenue3,556,67836,2913,592,969 Interest85,0008,00093,000 Property Taxes1,395,000- 1,395,000 Other Non-Operating Revenue595,23011,925607,155 Total Estimated Revenues FY201630,698,7491,842,06432,540,813 Expenses (Operating): Variable Water Costs (G.W., Import & Power)12,080,410 - 12,080,410 Salary Related Expenses8,118,352 845,865 8,964,218 Supplies & Services6,591,663 988,704 7,580,367 Depreciation6,003,400 1,346,600 7,350,000 Interest on Long Term Debt1,655,685 - 1,655,685 Other Expense22,000 - 22,000 Total Estimated Expenses FY201634,471,510 3,181,169 37,652,680 Net Income(Loss) FY 2016 (3,772,761)(1,339,105)(5,111,866) Estimated Fund Balance @ 6/30/2016119,867,592$ 40,739,789$ 160,607,381$ ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 21 Debt Administration The District’s debt rating from Fitch is “AA”. The District has no formal debt policy and no legal debt limit; however, the District’s future borrowing capacity is limited by the debt coverage ratio required by existing bond covenants. The ratio is calculated using revenue and expenses data pertaining to the Water Fund only and the covenants require that the coverage exceed 1.1. The District’s budgeted ratio is 1.25 for Fiscal Year 2016. This District’s Fiscal Year 2015/16 budgeted debt service obligation ($2,721,559) is related to its two existing debt issuances. Use of proceeds and the corresponding principal balance of each are as follows: Debt service requirements for the District’s Certificates of Participation are as follows: Year of Issuance Use of ProceedsPrincipal Balance as of June 2015 2008 COP COP funds are being issued to finance certain capital improvements, to fund a reserve fund, and to pay certain costs of delivery. $ 30,630,000 2012A Refunding Bond Refunding Bonds funds are being issued to finance certain capital improvements, to fund a reserve fund, and to pay certain costs of delivery. 7,795,000 38,425,000$ Debt service requirements for the District's Certificate of Participation and Revenue Bond are as follows: YearPrincipalInterestTotal 20161,045,000$ 1,676,559$ 2,721,559$ 20171,080,000$ 1,636,884$ 2,716,884$ 20181,120,000$ 1,594,309$ 2,674,309$ 20191,170,000$ 1,548,509$ 2,668,509$ 20201,210,000$ 1,500,909$ 2,670,909$ 2021-20256,850,000$ 6,701,525$ 13,551,525$ 2026-20298,470,000$ 5,032,963$ 13,502,963$ 2030-20349,875,000$ 3,004,944$ 12,879,944$ 2035-20397,605,000$ 783,375$ 8,388,375$ Total38,425,000$ 23,479,976$ 61,774,976$ ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 22 Debt Administration, Continued Employees Per Capita * Note: Employees per Capita is for fiscal year 2014/15 and is measured in number of employees per thousand customers. ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 23 Residential Meter Charge Comparison Note: Approximately 93% of the District’s customer base has a 1 inch or smaller meter. The charges for all agencies are current as of FY 14/15. ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 24 CAPITAL PROJECTS ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 25 2012 Pipeline Project ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 26 Capital Improvement Plan Project Description Total Project Budget 2014/15 CY Additions to CIP as Approved by Board Action Total Project Budget 2015/16 Total CIP Expenditures Thru FYE June 2014 Total Projected CIP Expenses in FY 2014/15 S & W Well Project (Well No. 21)2,306,789$ ‐$ 2,306,789$ 1,016,608$ 95,578$ S & W Well Project (Well No. 22)2,500,000$ ‐$ 2,500,000$ 4,869$ 36,451$ Fairmont BPS Upgrade6,300,000$ ‐$ 6,300,000$ 574,803$ 122,898$ Lakeview Grade Separation600,000$ 62,444 662,444$ 287,955$ 114,490$ Richfield Road Pipeline ‐$ 1,450,000$ 1,450,000$ ‐$ 75,414$ Subtotal 11,706,789$ 1,512,444$ 13,219,233$ 1,884,235$ 444,830$ Rehabilitation & Restoration Future Pipeline Project2,690,000$ (1,450,000) 1,240,000$ ‐$ 21,872$ Timber Ridge BPS Rehabilitation250,000$ ‐ 250,000$ ‐$ Lakeview Booster Piping100,000$ ‐ 100,000$ 6,000$ PRS Rehabilitation Phase 21,430,000$ ‐ 1,430,000$ ‐$ 31,690$ Annual Routine Capital R&R4,020,000$ (351,410)$ 3,668,590$ ‐$ ‐$ R & R Subtotal 8,490,000$ (1,801,410)$ 6,688,590$ ‐$ 59,562$ Vehicle & Capital Equipment Replacement 472,000$ 472,000$ 72,000$ Vehicle & Capital Equipment Replacement449,000$ 449,000$ 399,000$ Vehicle & Capital Equipment Subtotal 921,000$ ‐$ 921,000$ ‐$ 471,000$ Repayment of LOC Principal to Wells Fargo Bank Subtotal21,117,789$ (288,966)$ 20,828,823$ 1,884,235$ 975,392$ Projects Completed in FY 2014/15 Total Project Budget 2014/15 Over/(Under) Budget Adjusted Total CIP Budget FY 2015/16 Total CIP Expenditures Thru FYE June 2014 Total Projected CIP Expenses in FY 2014/15 YL Blvd BPS (Booster Pump Station)1,897,991$ 165,078 2,063,069$ 1,937,784$ 125,285$ Deville Drive Water Line Extention50,000$ 12,635 62,635$ 10,772$ 51,863$ Orangeview Waterline Extension ‐$ 80,120 80,120$ ‐$ 80,120$ Yorba Linda High School Park370,000$ 131,191 501,191$ 55,106$ 446,084$ Richfield Campus Spoils150,000$ 150,000$ ‐$ 145,020$ 2,467,991$ 389,024$ 2,857,015$ 2,003,662$ 848,372$ Grand Total23,585,780$ 100,058$ 23,685,838$ 3,887,897$ 1,823,764$ ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 27 Capital Improvement Plan, Continued FY 15/16 Budgeted CIP Expenditures FY 16/17 Budgeted CIP Expenditures FY 17/18 Budgeted CIP Expenditures FY 18/19 Budgeted CIP Expenditures FY 19/20 Budgeted CIP Expenditures 5 Year Future Projected Budgets 1,194,603$ ‐$ ‐$ ‐$ ‐$ 1,194,603$ 211,320$ 950,000$ 1,040,000$ 257,360$ ‐$ 2,458,680$ 1,000,000$ 4,000,000$ 602,299$ ‐$ ‐$ 5,602,299$ 260000260,000$ 1,340,000$ 34,586$ ‐$ ‐$ ‐$ 1,374,586$ 4,005,923$ 4,984,586$ 1,642,299$ 257,360$ ‐$ 10,890,168$ 760,000$ 458,128$ ‐$ ‐$ ‐$ 1,218,128$ 240,000$ 10,000$ ‐$ ‐$ ‐$ 250,000$ 94,000$ ‐$ ‐$ ‐$ ‐$ 94,000$ 153,310$ 528,000$ 90,000$ 627,000$ ‐$ 1,398,310$ ‐$ ‐$ 1,520,000$ 2,148,590$ ‐$ 3,668,590$ 1,247,310$ 996,128$ 1,610,000$ 2,775,590$ ‐$ 6,629,028$ 680,000$ 200,000$ 200,000$ 200,000$ 200,000$ 1,480,000$ $392,000$612,000$165,000$177,000$180,000 1,526,000$ 1,072,000$ 812,000$ 365,000$ 377,000$ 380,000$ 3,006,000$ 7,000,000$ 6,325,233$ 13,792,714$ 3,617,299$ 3,409,950$ 380,000$ 20,525,196$ 6,325,233$ 13,792,714$ 3,617,299$ 3,409,950$ 380,000$ 20,525,196$ ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 28 Vehicle Equipment and Capital Outlay (FY 2015/16) Department / ItemAmount Board of Directors None Administration None Engineering None Finance None Human Resources None IT Information Systems SQL System Upgrades (Operating System and Software)10,000$ Firewall Replacement 6,000$ Data Center Humidifier/Dehumidifier 24,000$ File Storage 19,000$ Server Replacement 5,000$ Total Vehicle Equipment & Capital Outlay- IT 64,000$ ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 29 Vehicle Equipment and Capital Outlay (FY 2015/16), Continued Department / ItemAmount Operations Adminstration Vehicle Wash Machine 12,000$ Water Operations & Maint. (2) Pickup Trucks 73,000$ Sewer Operations & Maint. Vactor Truck 400,000$ 13 Sewer Re-line (Manhole to Manhole)250,000$ Portable Generator for Lift Station (small)30,000$ Water Production Electric Generator (small)30,000$ SCADA Box Canyon PLC (Control System) Upgrade 16,000$ Well-10 PLC (Control System) Upgrade 14,000$ Well-15 PLC (Control System) Upgrade 14,000$ Well-19 PLC (Control System) Upgrade 10,000$ Main Router Replacement 42,000$ Momentum Unity CPU Upgrade 6,000$ Highland Reservoir Emergency System Replacement 75,000$ Lakeview Reservoir Emergency System Replacement 36,000$ Total Vehicle Equipment & Capital Outlay- Operations 1,008,000$ TOTAL VEHICLE EQUIPMENT & CAPITAL OUTLAY 1,072,000$ Reconciliation by Fund Water Fund 392,000$ Sewer Fund 680,000$ TOTAL1,072,000$ ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 30 Department Summaries ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 31 Board of Directors ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 32 Board of Directors Budget FY 2014/15 Budget FY 2015/16 Budget Expenses (Operating) Salary Related Expenses Salaries - Directors90,000$ 90,000$ Fringe Benefits52,442$ 59,385$ Mandatory Benefits - Directors8,533$ 7,991$ Total Salary Related Expenses150,975$ 157,376$ Supp li es & Services Communications-$ -$ Contractual Services1,500$ 1,500$ Dues & Memberships13,400$ 13,500$ Board Election Expenses75,000$ -$ District Meetings and Events-$ 1,500$ Professional Services90,000$ 90,000$ Professional Development4,100$ 14,000$ Travel & Conferences9,400$ 32,850$ Supplies & Services Sub-Total193,400$ 153,350$ ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 33 Board of Directors Supplies & Services Budget (FY 2015/16) Category Total Sub Acct Total Detail Amt $1,500 1,5001,500 200 6,000 100 4,500 2,500 200 $1,500 1,5001,500 30,000 60,000 $14,000 14,00014,000 1,500 2,000 3,000 150 2,000 2,400 16,250 1,200 4,000 350350 $153,350 Primary GL CategorySub Acct No./Sub Category Detail Item Description 1-1010-0600-00 Contractual Services 1-1010-0600-00 CONTRACTUAL SERVICES Tablet PC Data Service ($25 x 5) 1-1010-0640-00 Dues, Memberships, Subscriptions $13,500 1-1010-0640-00 Dues, Memberships, Subscriptions 13,500WACO CSDA Colorado River Water Users Assoc CASA Water Ed Foundation ISDOC 1-1010-0715-00 District Meetings and 1-1010-0715-55 Adminstration Meeting General Meeting Expenses 1-1010-0780-00 Professional Services $90,000 1-1010-0780-00 Professional Services 90,000Legal Services - Retainer Legislative Consultants ACWA (Spring- 2 @ $1,000, Fall- 2 @ $1,000) 1-1010-0810-00 Professional 1-1010-0810-00 Professional Development Board Workshops (4) 1-1010-0830-00 Travel & Conferences $32,850 1-1010-0830-00 Travel & Conferences 32,500Other Conferences CRWUA (2 attendees at $1,000 each) CSDA (2 attendees at $1,500 each) ISDOC Quarterly Urban Water Institute (1 attendee) Fall/Spring CASA Conference (Annual- $1,200, Winter-$1,200) AWWA (Annual- 3 @ $2,500, Section- 5 @ $1,750) MWDOC Water Policy Dinners 1-1010-0830-50 Meeting Mileage Mileage Section Total ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 34 Administration ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 35 Administration Department Budget (FY 2015/16) FY 2014/15 Budget FY 2015/16 Budget Expenses (Administration) Salary Related Expenses Salaries 553,406$ 798,250$ Fringe Benefits101,580$ 138,373$ Retiree Benefits149,519$ 150,590$ Unemployment Insurance10,400$ 10,400$ OPEB & CalPERS Contributions187,756$ 405,861$ Mandatory Benefits62,824$ 77,246$ Total Salary Related Expenses1,065,485$ 1,580,720$ Supplies & Services Communications189,994$ 192,500$ Contractual Services7,400$ 5,000$ Dues & Memberships52,960$ 52,985$ Fees & Permits-$ 2,700,250$ Insurance1,240$ 740$ District Activities & Events4,650$ 10,500$ Materials-$ 2,000$ Non-Capital Equipment-$ 11,000$ Office Expense250$ 4,340$ Professional Services405,750$ 169,250$ Professional Development3,350$ 3,780$ Travel & Conferences9,500$ 23,675$ Supplies & Services Sub-Total675,094$ 3,176,020$ ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 36 Administration Budget Division Detail (FY 2015/16) Administration Division Category TotalSub Acct Total Detail Amt 250 2,700,000 24,000 775 5,700 500 60 19,000 50 40 700 1,200 1,500 1,200 2,000 2,500 1,5001,500 5,0005,000 2,000 2,000 2,000 250 400 250 1,7501,750 50,000 25,000 87,00087,000 500 5,000 1,500 250 280 1,000 2,000 750 4,300 3,000 240 2,000 360 75 2,0002,000 $2,959,880 OCWA Meetings ISDOC Quarterly 1-2010-0830-50 Meeting Mileage Mileage Section Total 1-2010-0830-00 Travel & Conferences $14,725 1-2010-0830-00 Travel & Conferences 12,725ACWA (1 attendee) - Spring/Fall Laserfische Conference (1 attendee) AWWA (Annual- $2,500, Section- $1,750) Other Conferences MWDOC Water Policy Dinners CSDA Leadership Summit Records Destruction Codification Shred-It Records Retention Schedule Update 1-2010-0810-00 Professional Development $1,280 1-2010-0810-00 Professional Development 1,280Notary Training & Exam Misc GM Training 1-2010-0780-00 Professional Services $169,250 1-2010-0780-00 Professional Services 75,000Laserfische Upgrade District Plan Updates 1-2010-0780-05 Legal Services Routine Legal 1-2010-0780-15 Records Management 7,250 1-2010-0760-00 Office Expense $2,650 1-2010-0760-00 Office Expense 900Office Supplies Bereavement Flowers Hands Free Typing 1-2010-0760-21 Printer Supplies Printer Ink 1-2010-0715-00 District Meetings and Events $9,900 1-2010-0715-50 General Meeting Supplies 8,400Meeting Supplies (Board & Committee) All Hands Meetings (2) 1-2010-0750-00 Non-Capital Equipment $11,000 1-2010-0750-00 Non-Capital Equipment Executive Assistant Office Alteration 1-2010-0750-06 Desktops 6,000Replacement PC for Executive Secretary Replacement PC for Management Analyst Replacement PC for Records Mgmt. Specialist Management/Department Meetings Employee Holiday Luncheon Employee Picnic 1-2010-0715-55 Adminstration Meeting OCWA General Meeting Supplies 1-2010-0690-00 Insurance $740 1-2010-0690-00 Insurance 740Notary Insurance (AA) Honesty Bond (MM & AA) 1-2010-0640-00 Dues, Memberships, & Subscriptions $50,085 1-2010-0640-00 Dues, Memberships, & Subscriptions 50,085LAFCO CRWUA AWWA Misc. Notary Assoc Membership ACWA 1-2010-0645-00 Fees & Permits $2,700,250 1-2010-0645-00 Fees & Permits 2,700,250SDLF District of Distinction Accreditation Fee SWRCB Penalty Fees Primary GL CategorySub Acct No./Sub CategoryDetail Item Description ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 37 Administration Budget Division Detail (FY 2015/16) Public Affairs Division Category Total Sub Acct Total Detail Amt 6,0006,000 20,00020,000 45,000 10,000 13,00013,000 1,5001,500 17,500 11,500 38,00038,000 30,00030,000 $5,000 5,0005,000 500 1,000 600 800 $2,000 2,0002,000 350 250 1,4401,440 250250 $2,500 2,5002,500 1,400 2,600 1,000 650 300 500 2,5002,500 $216,140 1-2020-0830-50 Meeting Mileage Mileage Section Total 1-2020-0810-00 Professional Dlt 1-2020-0810-00 Professional Development Training 1-2020-0830-00 Travel & Conferences $8,950 1-2020-0830-00 Travel & Conferences 6,450CAPIO Annual Conference PRSA Annual Best Practices Summit CRWUA UWI Conference Water Policy Dinners Other Meetings/Conferences 1-2020-0760-00 Office Expense $1,690 1-2020-0760-00 Office Expense Conservation Enforcement Supplies 1-2020-0760-21 Printer Supplies Printer Ink 1-2020-0710-00 Materials 1-2020-0710-77 Drought Materials Drought Material 1-2020-0715-00 District Meetings & Events $600 1-2020-0715-50 Meeting Supplies 600Intergovernmental Meetings Division Meetings 1-2020-0640-00 Dues, Memberships, & Subscriptions $2,900 1-2020-0640-00 Dues, Memberships, & Subscriptions 2,900OC Register/LA Times Chamber Memberships (YL, PL) CAPIO Membership PRSA Membership 1-2020-0580-50 Customer Communication Customer Newsletter 1-2020-0580-55 Water Conservation Programs MWDOC Choice Water Use Efficiency 1-2020-0600-00 Contractual Services 1-2020-0600-00 Contractual Services Conservation Rebate Prog. (Turf, Sprinklers, Appli 1-2020-0580-00 Communications $192,500 1-2020-0580-05 Advertising General 1-2020-0580-15 District Special Events Community Events (Open House, Facility Tours, etc. 1-2020-0580-35 Promotional Items 55,000YLWD Bottled Water 1-2020-0580-36 Water Conservation Citi Direct Mailing 1-2020-0580-40 Sponsorships Sponsorship- OC Water Summit 1-2020-0580-45 Video Productions 29,000Digital Communications History Wall Promotional Items Primary GL CategorySub Acct No./Sub Category Detail Item Description ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 38 Engineering ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 39 Engineering Department Budget (FY 2015/16) FY 2014/15 Budget FY 2015/16 Budget Expenses (Engineering) Salary Related Expenses Salaries 928,221$ 921,656$ Fringe Benefits123,662$ 134,501$ Overtime2,200$ 2,255$ Mandatory Benefits124,485$ 95,414$ Total Salary Related Expenses1,178,568$ 1,153,826$ Supplies & Services Communications-$ 200$ Contractual Services96,160$ 103,190$ Data Processing-$ -$ Dues & Memberships2,963$ 38,600$ Fees & Permits28,050$ 28,000$ Materials2,000$ 6,500$ District Activities/Meetings-$ 600$ Maintenance-$ 195$ Non-Capital Equipment5,000$ 13,000$ Office Expense2,950$ 7,600$ Professional Services26,000$ 96,000$ Professional Development3,850$ 4,920$ Travel & Conferences3,300$ 6,000$ Supplies & Services Sub-Total170,273$ 304,805$ ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 40 Engineering Budget Division Detail (FY 2015/16) Administration Division Category Total Sub Acct Total Detail Amt $120 120120 $600 600600 $1,700 1,7001,700 3,5003,500 8,0008,000 $3,200 3,2003,200 $200 200200 800800 1,0001,000 $19,120 Primary GL CategorySub Acct No./Sub Category Detail Item Description 1-4010-0640-00 Dues, Memberships, & 1-4010-0640-00 Dues, Memberships, & S Dues, Memberships & Subscriptions 1-4010-0715-00 District Meetings and 1-4010-0715-50 General Meeting Expense Meeting/Event Supplies 1-4010-0710-00 Materials 1-4010-0710-00 Materials Emergency Food Supplies (1/3 of total) 1-4010-0750-00 Non-Capital Equipment $11,500 1-4010-0750-06 Desktops Replacement PC for Engineering Tech II 1-4010-0750-07 Notebooks/Tablets Replacement Laptops/Tablets 1-4010-0760-00 Office Expense 1-4010-0760-00 Office Expense Printer Ink 1-4010-0810-00 Professional 1-4010-0810-00 Training Training Section Total 1-4010-0830-00 Travel & Conferences $1,800 1-4010-0830-00 TRAVEL & CONFERENCES (E) Travel & Conferences 1-4010-0830-50 Meeting Mileage Mileage ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 41 Engineering Budget Division Detail (FY2015/16) Planning & Design Division Category Total Sub Acct Total Detail Amt $200 200200 17,400 4,200 10,000 500 250 5,000 25,000 1,000 4,200 $2,000 2,0002,000 3,2003,200 300300 50,000 1,000 30,000 15,00015,000 $700 700700 1,000 500 $171,450 Primary GL CategorySub Acct No./Sub Category Detail Item Description 1-4020-0580-00 Communications 1-4020-0580-00 Communications FOG Inspection Reports 1-4020-0600-00 Contractual Services $31,600 1-4020-0600-00 Contractual Services 31,600The Chambers Group (Hidden Hills) OCWD/ Well 21 Lease Agreement OCWD/ Well 22 Lease Agreement 1-4020-0640-00 Dues, Memberships, & Subscriptions $30,750 1-4020-0640-00 Dues, Memberships, & Subscriptions 30,750PE, BCEE ASCE Software License Renewal & Upgrade (Water Model) SCADA Watch (Water Model) 1-4020-0645-00 Fees & Permits $5,200 1-4020-0645-00 Fees & Permits 5,200FOG Inspection Fees (OCSD) OCWD/Well 21 Fee 1-4020-0710-00 Materials 1-4020-0710-00 Materials Emergency Preparedness Equipment & Materials 1-4020-0760-00 Office Expense $3,500 1-4020-0760-00 Office Expense Printer Ink 1-4020-0760-30 Books & Publications Books 1-4020-0780-00 Professional Services $96,000 1-4020-0780-00 Professional Services 81,000Urban Water Management Plan Update Water Master Plan Update Cathodic Protection Consulting Services 1-4020-0780-36 Professional Services - Water Water Consulting Services Section Total 1-4020-0810-00 Professional 1-4020-0810-00 Professional Development Certification Courses 1-4020-0830-00 Travel & Conferences $1,500 1-4020-0830-00 Travel & Conferences 1,500AWWA/ACE Conference Cathodic Protection ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 42 Engineering Budget Division Detail (FY 2015/16) Construction Division Category Total Sub Acct Total Detail Amt $2,500 2,5002,500 350 6,300 $1,500 1,5001,500 350350 250250 750 1,000 $500 500500 $13,500 1-4030-0830-00 Travel & Conferences 1-4030-0830-00 Travel & Conferences AWWA/ ACE Conference Section Total 1-4030-0810-00 Professional Development $1,750 1-4030-0810-00 Professional Development 1,750Inspector Certification Training (AWWA, CMAA) 1-4030-0750-00 Non-Capital Equipment 1-4030-0750-00 Non-Capital Equipment Inspection Related Tools & Equipment 1-4030-0760-00 Office Expense $600 1-4030-0760-00 Office Expense Office Supplies 1-4030-0760-30 Books & Publications Code Books 1-4030-0645-00 Fees & Permits 1-4030-0645-20 USA Underground Service USA Underground Service Alerts 1-4030-0640-00 Dues, Memberships, & Subscriptions $6,650 1-4030-0640-00 Dues, Memberships, & Subscriptions 6,650Construction Management Association of America EADOC Subscription (Planning Management Software) Primary GL CategorySub Acct No./Sub Category Detail Item Description ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 43 Engineering Budget Division Detail (FY 2015/16) Water Quality Division Category Total Sub Acct Total Detail Amt 3,0003,000 3,0003,000 5,5905,590 60,00060,000 300 20,000 80 1,000 $2,800 2,8002,800 $195 195195 $300 300300 550 250 850 620 $2,200 2,2002,200 $100,735 1-4040-0830-00 Travel & Conferences 1-4040-0830-00 Travel & Conferences AWWA/Water Quality Conference Section Total 1-4040-0760-00 Office Expense 1-4040-0760-30 Books & Publications AWWA Books 1-4040-0810-00 Professional Development $2,270 1-4040-0810-00 Professional Development 2,270Certifications AWWA WES August 13 (RM & AT) Backflow Specialist (AT) Misc AWWA Trainings 1-4040-0710-00 Materials 1-4040-0710-20 Wtr Quality Test Kit Reagents Wtr Quality Test Materials 1-4040-0730-00 Maintenance 1-4040-0730-10 Fume Hood Maintenance Maintenance & Testing 1-4040-0640-00 Dues, Memberships, & Subscriptions $1,080 1-4040-0640-00 Dues, Memberships, & Subscriptions 1,080ABPA (Maldonado) Water Purveyor Membership 1-4040-0645-00 Fees & Permits $20,300 1-4040-0645-10 Dept of Health Services 20,300County of Orange Dept. of Health Services (SWRCB-DD) 1-4040-0600-00 Contractual Services $71,590 1-4040-0600-00 CONTRACTUAL SERVICES System Disinfection/Blending 1-4040-0600-12 Backflow Device Rep Backflow Device Repair 1-4040-0600-25 Distrubution System Distribution System Disinfection 1-4040-0600-60 Microbiological Examination Water Quality Laboratory Testing Primary GL CategorySub Acct No./Sub Category Detail Item Description ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 44 Finance ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 45 Finance Department Budget (FY 2015/16) FY 2014/15 Budget FY 2015/16 Budget Expenses (Finance) Salary Related Expenses Salaries 843,820$ 883,762$ Fringe Benefits162,275$ 169,176$ Overtime6,200$ 6,355$ Mandatory Benefits104,142$ 88,388$ Total Salary Related Expenses1,116,437$ 1,147,681$ Supplies & Services Communications101,400$ 105,625$ Contractual Services101,870$ 82,210$ Data Processing-$ 61,020$ Dues & Memberships785$ 535$ Fees & Permits121,090$ 145,165$ Insurance600$ 600$ Materials25,000$ 197,000$ District Activities & Events1,050$ 1,100$ Maintenance300$ 300$ Non-Capital Equipment950$ 6,400$ Office Expense14,050$ 15,470$ Professional Services27,660$ 28,260$ Professional Development3,830$ 4,265$ Travel & Conferences3,900$ 7,525$ Uncollectible Accounts40,000$ 40,000$ Supplies & Services Sub-Total442,485$ 695,475$ ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 46 Finance Budget Division Detail (FY 2015/16) Administration Division Category Total Sub Acct Total Detail Amt $400 400400 $49,500 49,50049,500 110 155 160 $600 600600 $400 400400 18,960 2,600 5,000 1,200 300 325 300 500 1,500 500 500 $83,010 Primary GL CategorySub Acct No./Sub Category Detail Item Description 1-3010-0600-00 Contractual Services 1-3010-0600-00 CONTRACTUAL SERVICES (E) Check signature plate 1-3010-0620-00 Data Processing 1-3010-0620-20 Software License Renewals GP & CSM Annual Maintenance Fee 1-3010-0640-00 Dues, Memberships, & Subscriptions $425 1-3010-0640-00 Dues, Memberships, & Subscriptions 425CSMFO CMTA GFOA 1-3010-0690-00 Insurance 1-3010-0690-00 Insurance Honesty Bond 1-3010-0715-00 District Meetings and Et 1-3010-0715-50 Meeting Supplies Meeting Supplies 1-3010-0780-00 Professional Services $27,760 1-3010-0780-00 Professional Services 27,760Auditors GASB 68 Statement Preparation Actuarial Services CDAR Preparation 1-3010-0810-00 Professional Development $925 1-3010-0810-00 Professional Development 925CMTA Seminars 2014 Government Tax Update CSMFO Workshops Section Total 1-3010-0830-00 Travel & Conferences $3,000 1-3010-0830-00 Travel & Conferences 3,000CalPERS Annual Conference CSMFO Conference AWWA Conference CMTA ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 47 Finance Budget Division Detail (FY 2015/16) Accounting Division Category Total Sub Acct Total Detail Amt $625 625625 500 360 150 435 330 25 50,000 225 $110 110110 $400 400400 $300 300300 500500 2,0002,000 1,5001,500 9,0009,000 3,5003,500 1,2001,200 $1,000 1,0001,000 1,000 1,500 500 $75,160 Primary GL CategorySub Acct No./Sub Category Detail Item Description 1-3020-0580-00 Communications 1-3020-0580-00 Communications Publish Unclaimed List 1-3020-0600-00 Contractual Services $860 1-3020-0600-00 Contractual Services 860Green Shades Doculivery 1-3020-0645-00 Fees & Permits $51,165 1-3020-0645-00 Fees & Permits 915CSMFO Budget Reviewer Fee GFOA CAFR Reviewer Fee GFOA Budget Award Reviewer Fee 1-3020-0645-50 Bank Service/Fees 50,250Annual Bankcard Fee Analysis Fees (Avg $4800/mo) Safe Deposit Box Fee 1-3020-0640-00 Dues, Memberships, & CSMFO 1-3020-0730-00 Maintenance 1-3020-0730-00 Maintenance Small Office Equipment Maintenance 1-3020-0715-00 District Meetings and 1-3020-0715-50 Meetin g Supplies Meeting Supplies 1-3020-0640-00 Dues , Memberships , & 1-3020-0750-00 Non-Capital Equipment $4,000 1-3020-0750-00 Non-Ca pital Equipment Ergotron/Veridesk 1-3020-0750-06 Deskto ps Dell Computer 1-3020-0750-41 Audio/Visual Monitors 1-3020-0760-00 Office Expense $13,700 1-3020-0760-00 Office Expense Office Supplies 1-3020-0760-10 Pa per Paper 1-3020-0760-21 Printer Su pplies Printer Cartridges Section Total 1-3020-0810-00 Professional 1-3020-0810-00 Professional Development Staff Training 1-3020-0830-00 Travel & Conferences $3,000 1-3020-0830-00 Travel & Conferences 3,000CSMFO Conference CalPERS Annual Conference CMTA ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 48 Finance Budget Division Detail (FY 2015/16) Customer Service/Billing Division Category Total Sub Acct Total Detail Amt 500500 5,5005,500 99,00099,000 250 1,500 1,600 4,000 600 20,000 48,000 5,0005,000 $11,520 11,52011,520 34,000 60,000 $300 300300 $500 500500 350 300 1,0001,000 $500 500500 $1,400 1,4001,400 500500 325325 $40,000 40,00040,000 $336,645 Primary GL CategorySub Acct No./Sub CategoryDetail Item Description 1-3030-0600-22 Printing of Bills - Infosend 68,000Info Send E-Bill Fees 1-3030-0580-00 Communications $105,000 1-3030-0580-00 Communications AB 2747 Compliance 1-3030-0580-10 Postage Postage Metered 1-3030-0580-22 Postage - Infosend Postage - Infosend Post Office Box Meter & Scale Lease Agreement Post Master - Lockbox 1-3030-0600-21 Customer Credit Check 4,600Online - Credit Checks Online - Utility Exchange Mailing Service 1-3030-0620-00 Data Processing 1-3030-0620-00 Data Processing Cogsdale - Penalty Blocks 1-3030-0645-00 Fees & Permits $94,000 1-3030-0645-50 Bank Services/Fees 94,000Lock Box Services Credit Card & Auto Dr Processing 1-3030-0600-55 Answering Service Phone Answering Service 1-3030-0600-00 Contractual Services $80,950 1-3030-0600-00 Contractual Services 3,350 1-3030-0715-00 District Meetings and 1-3030-0715-50 General Meeting Expense Meeting Supplies 1-3030-0750-00 Non-Capital Equipment 1-3030-0750-00 Non-Capital Equipment Letter Folding Equipment 1-3030-0760-00 Office Expense $1,650 1-3030-0760-00 Office Expense 650Postage Machine Supplies Forms/Deposit Slips 1-3030-0760-21 Printer Supplies Printer Cartridge 1-3030-0780-00 Professional Services 1-3030-0780-09 Collection Services Collection Agency Fee 1-3030-0810-00 Professional 1-3030-0810-00 Professional Development Customer Service Training (min of 2 classes PP) 1-3030-0830-00 Travel & Conferences $825 1-3030-0830-00 Travel & Conferences AWWA 1-3030-0830-50 Meeting Mileage Mileage Reimbursement 1-3030-0850-00 Uncollectible Accounts 1-3030-0850-00 Uncollectible Accounts Uncollectible Accounts Section Total ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 49 Finance Budget Division Detail (FY 2015/16) Meter Reading Division Category TotalSub Acct Total Detail Amt 140,000 140,000 25,000 25,000 9,000 9,000 23,000 23,000 500 400 1,000 1,000 120 120 120 700 700 240 240 700 700 700 $200,660 1-3040-0830-00 Travel & Conferences 1-3040-0830-00 Travel & Conferences AWWA Conference Section Total 1-3040-0760-00 Office Expense 1-3040-0760-21 Printer Supplies Printer Cartirdge 1-3040-0810-00 Professional Development 940 1-3040-0810-00 Professional Development Training classes 1-3040-0810-40 Certificate Reimbursement Certificate Reimbursement 1-3040-0750-00 Non-Capital Equipment 1,900 1-3040-0750-00 Non-Capital Equipment 900 Meter Shop Equipment Construction Meter Locks 1-3040-0750-07 Notebooks/Tablets Tablets 1-3040-0710-00 Materials 197,000 1-3040-0710-40 Replacment Meters Replacement Meters 1-3040-0710-50 Replacement MXU MXUs 1-3040-0710-55 Meters Boxes/Lids/Vaults Meter Boxes/Lids/Vaults 1-3040-0710-58 Registers Registers Primary GL CategorySub Acct No./Sub Category Detail Item Description ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 50 Human Resources ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 51 Human Resources Department Budget (FY 2015/16) FY 2014/15 Budget FY 2015/16 Budget Expenses (HR) Salary Related Expenses Salaries 373,949$ 457,116$ Fringe Benefits75,009$ 83,944$ Overtime1,689$ 1,731$ Mandatory Benefits44,874$ 46,566$ Total Salary Related Expenses495,521$ 589,357$ Supplies & Services Communications3,000$ 3,000$ Contractual Services34,150$ 25,870$ Dues & Memberships5,635$ 7,960$ Insurance311,500$ 295,000$ Materials1,400$ 1,100$ District Activities & Events17,510$ 12,610$ Non-Capital Equipment-$ 3,800$ Office Expense700$ 1,865$ Professional Services70,700$ 104,700$ Professional Development25,500$ 24,500$ Travel & Conferences5,100$ 9,200$ Supplies & Services Sub-Total475,195$ 489,605$ ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 52 Human Resources Budget Division Detail (FY 2015/16) Administration Division Category Total Sub Acct Total Detail Amt $3,000 3,0003,000 600 3,000 3,000 5,000 500 3,0003,000 1,5001,500 5,000 1,300 4,000 525 85 400 300 2,000 210 1,000 2,2002,200 2,0002,000 1,0001,000 3,000 800 300300 609 206 250250 90,00090,000 13,70013,700 8,0008,000 3,0003,000 5,800 400 $165,685Section Total 1-7010-0830-00 Travel & Conferences $6,200 1-7010-0830-00 Travel & Conferences 6,200LCW (3 employees) Public Retirement Seminar (2 employees) 1-7010-0810-00 Professional Development $11,000 1-7010-0810-00 Professional Development LCW 1-7010-0810-20 Job Training On-going Job Training 1-7010-0780-00 Professional Services $103,700 1-7010-0780-05 Legal Services Liebert Cassidy Whitmore Employment Law 1-7010-0780-55 Investigations Investigations, Backgrounds, and EE Relations 1-7010-0760-00 Office Expense $1,365 1-7010-0760-00 Office Expense Office Supplies 1-7010-0760-21 Printer Supplies 815Brother MFC-9970CDW (2 black & 3 color (1 each)) HL2270DW (3) 1-7010-0760-30 Books & Publications Public Retirement Journal 1-7010-0750-00 Non-Capital Equipment $3,800 1-7010-0750-07 Notebooks/Tablets 3,800Laptop Tablet 1-7010-0715-00 District Meetings and Events $8,410 1-7010-0715-20 District Events - Employee Recognition 3,210Retiree Event (2) Retiree Recognition Service Recognition 1-7010-0715-30 District Events - Benefit Fair Benefit Fair 1-7010-0715-40 District Events - Employee Employee Promotional Items 1-7010-0715-50 General Meeting Expense Meeting/Training Supplies 1-7010-0600-30 Health & Welfare 6,300Interactive Process Flu Shots 1-7010-0640-00 Dues, Memberships & Subscriptions $5,310 1-7010-0640-00 Dues, Memberships & Subscriptions 5,310LCW (Consortium & Library) PELRAC Jobs Available Subscription CALPELRA Annual Dues National Notary Association 1-7010-0580-00 Communications 1-7010-0580-05 Advertising Job Advertising Expenses 1-7010-0600-00 Contractual Services $22,900 1-7010-0600-00 Contractual Services 12,100COBRA Solutions CPS (Testing) - Human Resources Neo Gov- Online Applications Neo Gov- Performance Evaluations Flex Advantage 1-7010-0600-10 DOT Physicals Fit for Duty 1-7010-0600-20 Post-Employment Physicals Post-Employment Physicals Primary GL CategorySub Acct No./Sub Category Detail Item Description ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 53 Human Resources Budget Division Detail (FY 2015/16) Risk Management Division Category Total Sub Acct Total Detail Amt 420 300 100 700 5,0005,000 230,000230,000 60,00060,000 $500 500500 $1,000 1,0001,000 $500 500500 $3,000 3,0003,000 $301,520 Primary GL CategorySub Acct No./Sub Category Detail Item Description 1-7020-0600-00 Contractual Services $720 1-7020-0600-00 Contractual Services 720DOT Physicals (12 x 35) Respiratory Fit Testing (60 x 5) 1-7020-0640-00 Dues, Memberships, & Subscriptions $800 1-7020-0640-00 Dues, Memberships, & Subscriptions 800PARMA Membership AED Medical Director Oversight 1-7020-0690-00 Insurance $295,000 1-7020-0690-10 Tort Claims Tort Claims - < 15K 1-7020-0690-20 Liability Insurance ACWA-JPIA Liability Insurance 1-7020-0690-30 Property Insurance ACWA-JPIA Property Insurance 1-7020-0760-00 Office Expense 1-7020-0760-00 Office Expense Ergotron Desks & Mats (1 x 500) 1-7020-0780-00 Professional Services 1-7020-0780-00 Professional Services First Aid-Injured Workers Section Total 1-7020-0810-00 Professional 1-7020-0810-00 Professional Development Risk Management Training 1-7020-0830-00 Travel & Conferences 1-7020-0830-00 Travel & Conferences PARMA Conference (2 x $1,500) ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 54 Human Resources Budget Division Detail (FY 2015/16) Safety Division Category Total Sub Acct Total Detail Amt 1,250 1,000 500 150 200 1,000 600 500 1,200 3,000 8,0008,000 5,0005,000 $22,400 Primary GL CategorySub Acct No./Sub Category Detail Item Description 1-7030-0600-00 Contractual Services $2,250 1-7030-0600-00 Contractual Services 2,250HEP B ($250 x 5) Industrial Hearing Management 1-7030-0640-00 Dues, Memberships, & Subscriptions $1,850 1-7030-0640-00 Dues, Memberships, & Subscriptions 1,850Cal-OSHA Reporter PASMA (2 x 75) Safety Center Inc. Online SDS Support 1-7030-0710-00 Materials $1,100 1-7030-0710-00 Materials 1,100First Aid Restocker First Aid Supplies (Field Backpacks) 1-7030-0715-00 District Meetings and Events $4,200 1-7030-0715-50 General Meeting Expense 4,200Meeting/Training Supplies Safety WORKS (Promo Safety Recognition) Section Total 1-7030-0810-00 Professional Development $13,000 1-7030-0810-10 OSHA Compliance OSHA Compliance Training 1-7030-0810-20 Job Training On Job Training ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 55 Information Technology ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 56 Information Technology Department Budget (FY 2015/16) FY 2014/15 Budget FY 2015/16 Budget Expenses (IT) Salary Related Expenses Salaries 602,394$ 472,163$ Fringe Benefits91,979$ 57,830$ Overtime10,400$ 2,460$ Mandatory Benefits75,102$ 48,943$ Total Salary Related Expenses779,875$ 581,396$ Supplies & Services Communications-$ -$ Contractual Services143,120$ 148,385$ Data Processing 186,830$ 125,309$ Dues & Memberships1,622$ 280$ Materials15,825$ 2,400$ District Activities & Events300$ 800$ Maintenance79,250$ 6,900$ Non-Capital Equipment98,950$ 40,800$ Office Expense15,025$ 7,825$ Professional Services91,500$ 95,000$ Professional Development11,800$ 11,000$ Travel & Conferences9,700$ 15,600$ Supplies & Services Sub-Total653,922$ 454,299$ ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 57 IT Budget Division Detail (FY 2015/16) Administration Division Category Total Sub Acct Total Detail Amt $200 200200 $500 500500 $2,000 2,0002,000 $675 675675 $500 500500 1,600 2,600 1,400 3,500 $12,975 Primary GL CategorySub Acct No./Sub Category Detail Item Description 1-6010-0640-00 Dues, Memberships, & 1-6010-0640-00 Dues, Memberships, & MISAC 1-6010-0715-00 District Meetings and 1-6010-0715-50 General Meeting Expense Meeting Supplies 1-6010-0750-00 Non-Capital Equipment 1-6010-0750-10 Desktops PC 1-6010-0760-00 Office Expense 1-6010-0760-21 Printer Supplies Printer Cartridge Emergency Backup Location Visits Section Total 1-6010-0810-00 Professional 1-6010-0810-00 Professional Development Pluralsight Tech Library 1-6010-0830-00 Travel & Conferences $9,100 1-6010-0830-00 Travel & Conferences 9,100Interop (April/May) WinConnections (November) MISAC ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 58 IT Budget Division Detail (FY 2015/16) Information Systems Division Category Total Sub Acct Total Detail Amt 1,800 85 600 15,000 4,500 12,500 21,000 4,000 3,900 26,50026,500 15,00015,000 25,000 15,000 3,500 4,000 2,400 3,200 2,000 30,000 250 12,000 1,000 7,000 5,000 13,500 0 6,109 750 1,500 200 0 150 200 150 30 50 200200 400 100 200 200 900 400 Primary GL CategorySub Acct No./Sub Category Detail Item Description 1-6020-0600-00 Contractual Services $148,385 1-6020-0600-00 Contractual Services 1,885Security Solutions: Annual Fire & Burglar Alarm District Site Hosting 1-6020-0600-10 Data Hosting 15,600FTP Today for ftp service ($54.95/month) DR Location 1-6020-0600-20 Lease Agreements 17,000Konica Minolta Operations Copier Lease Konica Minolta Copier Leases for Admin Building 1-6020-0600-30 Warranties & Service Contracts 28,900RMJ Tech. GPS Vehicle Tracking Service Dell Hardware Service Contracts APC Symmetra Data Center UPS On-Site Service Rene 1-6020-0600-32 Service for Cell Phones Cell Phone Service (Verizon) 1-6020-0600-33 Mobile Broadband Service Verizon Broadband Aircard Service (MGMT/CMMS) 1-6020-0600-34 Communication Lines 43,500Time Warner Cable & Dedicated Internet Access 50x AT&T District Lines DR Communication Lines Microsoft Volume License Renewals Lenel Onguard Software Support Agreement Renewal Solar Winds Orion Monitoring Tool Maintenance Solar Winds Engineering's Toolkit Renewal VMWare vSphere (Essentials Plus Kit) Maintenance Appassure Backup Software Renewal 1-6020-0620-00 Data Processing $89,409 1-6020-0620-10 Software Purchases 6,400CMMS Licensing Solarwind SQL Monitor 1-6020-0620-20 Software License Renewals 73,950Trend Micro NeatSuite Antivirus & Spyware 110 lic Netmotion Mobility XE Premium Software Maintenanc CityWorks Annual Maintenance Specter Soft Renewal 1-6020-0620-30 Hardware Subscription Renewals 8,559Watchguard XTM810 Firewall UTM Renewal (2 items) Barracuda Spam Firewall Energizer Annual Renewal Barracuda Message Archiver Energizer Annual Renew PageR Monitoring Idealstor Archiver ($3,000) 1-6020-0620-47 Cell Phone Supplies 500Chargers Batteries Holsters & Covers 1-6020-0640-00 Dues, Memberships, & Subscriptions $80 1-6020-0640-00 Dues, Memberships, & Subscriptions 80CPU 1-6020-0710-60 Hardware Supplies 1,500USB Drives USB Keys, SD / micro SD Cards Desktop peripherals Hardware supplies, AA & AAA batteries PCWorld 1-6020-0710-00 Materials $2,400 1-6020-0710-00 Materials Materials 1-6020-0710-51 Cabling 700Duplex 50/125 LC/LC fiber, CAT6A, CAT5e patch cab Adapters DVI, VGA, DB9, Display Port, HDMI, USB cables ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 59 IT Budget Division Detail (FY 2015/16) Information Systems Division, Continued Category Total Sub Acct Total Detail Amt $300 300300 850850 1,2001,200 400 800 400 400 1,5001,500 1,000 350 2,0002,000 2,0002,000 20,000 1,500 0 200 1,500 200 800 2,200 800800 500 1,000 1,0001,000 1,0001,000 100100 2,000 50 200 200 400 200 5,5005,500 3,500 50,000 1,0001,000 2,500 1,000 2,200 1,000 400 1,600 $354,024 1-6020-0715-00 District Meetings and 1-6020-0715-50 Meeting Supplies Meeting Supplies Primary GL CategorySub Acct No./Sub Category Detail Item Description Phone Switch Servicing Security Equipment Maintenance & Repair 1-6020-0730-30 Cabling & WAN Cabling (CAT6A, CAT5e, fiber) installation & rep ( 1-6020-0730-60 UPS & Back-up Power systems 1,350APC Symmetra Data Center UPS battery modules (6) UPS replacement batteries for desktops 1-6020-0730-00 Maintenance $6,900 1-6020-0730-00 Maintenance Maintenance 1-6020-0730-06 Printer Servicing HP Printer Servicing 1-6020-0730-11 Telco/Phone Servicing 2,000Building Line Repairs Cell Phone Servicing/replacement/repair Tablets 1-6020-0750-09 Networking Equipment 4,900KVM System Interface Pods Network Storage Devices Network Office/cubicle Switches Misc Network Equipment such as Transceivers Data Center Switches 1-6020-0750-00 Non-Capital Equipment $34,700 1-6020-0750-00 Non-Capital Equipment Non-Capital Equipment 1-6020-0750-06 Desktops Dell Optiplex PCs 1-6020-0750-07 Notebooks 21,500CMMS Notebooks and Equipment Dell Notebooks 1-6020-0760-00 Office Expense $3,150 1-6020-0760-00 Office Expense Business Cards 1-6020-0760-21 Printer Supplies 2,050 1-6020-0750-30 Tools & Equipment Data Center equipment (Rack & Cabinet) 1-6020-0750-35 Security 1,500HID proximity badges for building access FABS HP LaserJet Printers & Copier toners fusers etc Konica Minolta Copier/Printer Supplies Mail Room 1-6020-0760-26 Desktop Supplies 1,000Mice Blank DVD+R, CD Disc, USB Keys etc. Keyboards Misc 1-6020-0750-41 Audio/Visual Replacement LCD Monitors 1-6020-0750-45 Telco Phones & Accessories 1-6020-0810-00 Professional Development $3,500 1-6020-0810-00 Professional Development 3,500GeneralTraining Plural Site 1-6020-0780-00 Professional Services $60,000 1-6020-0780-11 Network/Hardware Consulting Network Engineering Consulting 1-6020-0780-20 Software Consulting 53,500Software Consulting CMMS Consulting EEC 1-6020-0780-50 Technical Support Technical Support Section Total 1-6020-0830-00 Travel & Conferences $5,200 1-6020-0830-00 Travel & Conferences 5,200Intersect (October) R.S. CityWorks User's Conference (June) R.S. Mileage and Travel Reimbursement Interop ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 60 IT Budget Division Detail (FY 2015/16) GIS Division Category Total Sub Acct Total Detail Amt 4,000 2,000 3,200 6,100 900 3,500 1,700 14,500 $4,100 4,1004,100 $4,000 4,0004,000 $35,000 35,00035,000 3,000 4,000 1,050 250 $87,300 Primary GL CategorySub Acct No./Sub Category Detail Item Description 1-6030-0620-00 Data Processing $35,900 1-6030-0620-20 Software License Renewals 35,900InfoWater Renewal & Upgrade Floating License Freeance Maintenance ArcEditor Concurrent Maintenance (2) ArcGIS Server Standard Enterprise Maintenance ArcView Single Use Maintenance ArcInfor Concurrent Maintenance AutoCAD & Map 3D Maintenance Satellite Imagry 1-6030-0750-30 Tools & Equipment GIS Miscellaneous Tools (Hardware) 1-6030-0780-00 Professional Services 1-6030-0780-20 Software Consulting GIS Staff Augmentation & Cons. Services, EEC 1-6030-0760-00 Office Expense 1-6030-0760-21 Printer Supplies Atlas Water & Sewer Supplies 1-6030-0750-00 Non-Capital Equipment 1-6030-0810-00 Professional Development $7,000 1-6030-0810-00 Professional Development 7,000GIS Analyst Training GIS and CMMS Training, EEC Section Total 1-6030-0830-00 Travel & Conferences $1,300 1-6030-0830-00 Travel & Conferences 1,300GIS ESRI User Conference Mileage and Travel Reimbursement ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 61 Operations ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 62 Operations Department Budget (FY 2015/16) FY 2014/15 Budget FY 2015/16 Budget Expenses (Operating) Salary Related Expenses Salaries 2,574,013$ 2,767,635$ Fringe Benefits535,515$ 551,814$ Overtime192,600$ 204,813$ Mandatory Benefits420,823$ 364,601$ Total Salary Related Expenses3,722,951$ 3,888,862$ Supplies & Services Communications500$ 200$ Contractual Services176,500$ 220,000$ Data Processing-$ 47,500$ Dues & Memberships700$ 1,250$ Fees & Permits37,050$ 53,250$ Materials613,900$ 586,950$ District Activities & Events1,200$ 2,000$ Maintenance427,471$ 739,950$ Non-Capital Equipment47,100$ 92,750$ Office Expense7,500$ 5,750$ Professional Services-$ 61,500$ Professional Development12,750$ 12,550$ Travel & Conferences5,600$ 19,880$ Utilities 90,800$ 90,850$ Vehicle Expense358,400$ 372,433$ Supplies & Services Sub-Total1,779,471$ 2,306,813$ ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 63 Operations Budget Division Detail (FY 2015/16) Administration Division Category Total Sub Acct Total Detail Amt $13,000 13,00013,000 $150 150150 $2,000 2,0002,000 $18,000 18,00018,000 1,0001,000 10,00010,000 2,7002,700 250250 2,5002,500 500500 300300 1,0001,000 3,0003,000 1,5001,500 2,5002,500 560560 $58,960 1-5010-0830-50 Meeting Mileage Mileage Section Total 1-5010-0830-00 Travel & Conferences $8,560 1-5010-0830-10 Travel AWWA (Fall & Spring), CWEA 1-5010-0830-20 Lodging AWWA (Fall & Spring), CWEA 1-5010-0830-30 Meals AWWA (Fall & Spring), CWEA 1-5010-0830-40 Registration AWWA (Fall & Spring), CWEA 1-5010-0810-00 Professional Development $800 1-5010-0810-00 Professional Development Training 1-5010-0810-40 Certificate Reimbursement Certificate Reimbursement 1-5010-0760-00 Office Expense $5,450 1-5010-0760-20 Printer Ink Printer Ink 1-5010-0760-30 Books & Publications Manuals/Books/Magazines 1-5010-0760-40 Breakroom Supplies Breakroom Supplies 1-5010-0750-00 Non-Capital Equipment $11,000 1-5010-0750-41 Audio/Visual Computer Monitor Upgrade 1-5010-0750-50 Safety Equipment Safety Equipment (Regulatory Requirements) 1-5010-0715-00 District Meetings and 1-5010-0715-50 General Meeting Expense Meeting Supplies 1-5010-0710-00 Materials 1-5010-0710-65 PPE Equipment PPE Equipment 1-5010-0600-00 Contractual Services 1-5010-0600-50 Uniforms Uniforms (District-wide) 1-5010-0640-00 Dues, Memberships, & 1-5010-0640-00 Dues, Memberships, & Dues, Memberships, & Subscriptions Primary GL CategorySub Acct No./Sub Category Detail Item Description ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 64 Operation Budget Division Detail (FY 2015/16) Water Operation & Maintenance Division Category Total Sub Acct Total Detail Amt 2,1002,100 10,00010,000 5,0005,000 30,00030,000 4,5004,500 10,00010,000 100,000100,000 85,00085,000 27,50027,500 5,0005,000 1,5001,500 7,0007,000 90,00090,000 12,00012,000 2,0002,000 4,0004,000 20,00020,000 25,00025,000 150,000150,000 45,00045,000 1,0001,000 1,5001,500 500500 8,5008,500 2,0002,000 1,5001,500 $6,500 6,5006,500 $657,100 Primary GL CategorySub Acct No./Sub Category Detail Item Description 1-5020-0645-00 Fees & Permits $17,100 1-5020-0645-25 NPDES/RWQCB NPDES Deminimus (RWQCB) 1-5020-0645-45 Landfill (Orange County & Dan Landfill (Orange County & Dan Coop) 1-5020-0645-55 Encroachment Permits Encroachment Permits 1-5020-0710-00 Materials $378,500 1-5020-0710-05 Road Material Road Material 1-5020-0710-13 Air-Vac Parts Air-Vac parts 1-5020-0710-15 Cla-Valve Parts Cla Valve Parts 1-5020-0710-25 Hydrant Repair Parts Hydrant Repair Parts 1-5020-0710-30 Valve Repair Parts Valve Repair Parts 1-5020-0710-36 City of YL Valve Adjustments City of YL Valves 1-5020-0710-60 Hardware Supplies Hardware Supplies 1-5020-0710-81 Welding Supplies Welding Supplies 1-5020-0710-85 Cleaning/Painting Supplies Cleaning/Painting Supplies 1-5020-0710-90 Water Service Repair Parts Water Service Repair Parts 1-5020-0730-66 Asphalt Paving Asphalt Paving 1-5020-0730-67 Concrete Repair Concrete Repair 1-5020-0710-94 Miscellaneous Warehouse Miscellaneous Warehouse Parts 1-5020-0710-96 Ready Mix Concrete Ready Mix Concrete 1-5020-0710-98 Landscape Supplies Landscape Supplies 1-5020-0730-72 Safety Equipment Repairs Safety Equipment Repairs 1-5020-0750-00 Non-Capital Equipment $10,500 1-5020-0750-06 Desktops Replacement Desktop 1-5020-0750-15 Equipment Rental Equipment Rental 1-5020-0750-30 Tool & Equipment Tool & Equipment 1-5020-0730-00 Maintenance $241,000 1-5020-0730-36 City of Yorba Linda Value City of Yorba Linda Valve Repair 1-5020-0730-43 Value Repair Valve Repair (Normal Business) 1-5020-0810-00 Professional Development $3,500 1-5020-0810-00 Professional Development Training 1-5020-0810-40 Certificate Reimbursement Certificate Reimbursement 1-5020-0830-00 Travel & Conferences 1-5020-0830-00 Travel & Conferences AWWA Conference (5 Employees) Section Total ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 65 Operation Budget Division Detail (FY 2015/16) Sewer Operation & Maintenance Division Category Total Sub Acct Total Detail Amt $200 200200 $300 300300 2,2002,200 1,0001,000 1,0001,000 27,50027,500 25,00025,000 250,000250,000 3,0003,000 10,00010,000 1,5001,500 15,00015,000 1,5001,500 20,00020,000 4,0004,000 15,00015,000 1,8001,800 400400 300300 1,2001,200 720720 1,2001,200 $850 850850 25,00025,000 1,0001,000 8,0008,000 15,50015,500 $433,170 Primary GL CategorySub Acct No./Sub Category Detail Item Description 2-5030-0580-00 Communications 2-5030-0580-00 Communications Public Communications 2-5030-0640-00 Dues, Memberships, 2-5030-0640-00 Dues, Memberships, CWEA Memberships 2-5030-0645-00 Fees & Permits $3,200 2-5030-0645-30 WDR - SSO (SWRCB) WDR - SSO (SWRCB) 2-5030-0645-55 Encroachment Permits Encroachment Permits 2-5030-0710-00 Materials $53,500 2-5030-0710-60 Hardware Supplies Hardware Supplies 2-5030-0710-86 Placentia/Yorba Linda Island City of Yorba Linda Manholes 2-5030-0710-92 Sewer Main Repair Parts Sewer Main Repair Parts 2-5030-0730-00 Maintenance $301,000 2-5030-0730-59 Sewer Line Repairs Sewer Line Repairs 2-5030-0730-65 Vector Control In Manholes Vector Control in Manholes 2-5030-0730-66 Asphalt Paving Asphalt Paving 2-5030-0730-67 Concrete Repair Concrete Repair 2-5030-0730-71 CCTV Repairs CCTV Repairs 2-5030-0730-72 Safety Equipment Repairs Safety Equipment Repairs 2-5030-0730-86 Placentia/Yorba Linda City of Yorba Linda Manhole Labor 2-5030-0750-00 Non-Capital Equipment $19,000 2-5030-0750-06 Desktops Replacement Computer for Sewer Camera Truck 2-5030-0750-30 Tools & Equipment Tools & Equipment 2-5030-0810-00 Professional Development $2,200 2-5030-0810-00 Professional Development PACP Training Course 2-5030-0810-40 Certificate Reimbursement Certificate Reimbursement 2-5030-0830-00 Travel & Conferences $3,420 2-5030-0830-10 Travel PACP Conference 2-5030-0830-20 Lodging PACP Conference 2-5030-0830-30 Meals PACP Conference 2-5030-0830-40 Registration PACP Conference Section Total 2-5030-0870-00 Utilities 2-5030-0870-10 Electric Electric 2-5030-0890-00 Vehicle Expenses $49,500 2-5030-0890-46 Vehicle Expense: Sewer OPS - Sewer Vehicle Maint 2-5030-0890-47 Vehicle Expense: Sewer OPS - Sewer - Equipment Maintenance 2-5030-0890-48 Vehicle Expense: Sewer Gas OPS - Sewer - Gas 2-5030-0890-49 Vehicle Expense: Sewer OPS - Sewer - Diesel ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 66 Operation Budget Division Detail (FY 2015/16) Water Production Division Category Total Sub Acct Total Detail Amt $50 5050 4,0004,000 35,00035,000 3,0003,000 50,00050,000 10,00010,000 500500 25,00025,000 5,0005,000 10,00010,000 12,00012,000 5,0005,000 5,0005,000 2,5002,500 1,5001,500 5,0005,000 1,0001,000 600600 $175,150 Primary GL CategorySub Acct No./Sub Category Detail Item Description 1-5040-0640-00 Dues, Memberships, 1-5040-0640-00 Dues, Memberships, OCWA Memberships 1-5040-0710-00 Materials $102,500 1-5040-0710-17 Pump Station Repair Parts Pump Parts 1-5040-0710-35 CL2 Parts CL2 Parts 1-5040-0710-60 Hardware Supplies 1-5040-0730-20 General Electric Services Electric General Maintenance 1-5040-0730-24 Reservoir Services Reservoir Repairs Hardware Supplies 1-5040-0710-75 Salt Salt (Water Softeners) 1-5040-0710-84 Production Repair Parts Valves, Gauges, AV, etc. 1-5040-0710-85 Cleaning/Painting Supplies Cleaning/Painting Supplies 1-5040-0730-29 Wells: Calibration, Mtce, Well Maintenance 1-5040-0730-75 Pump Station Repairs Pump Station Repairs 1-5040-0750-00 Non-Capital Equipment $9,000 1-5040-0750-07 Notebooks/Tablets Laptop 1-5040-0750-30 Tools & Equipment Tools & Equipment 1-5040-0730-00 Maintenance $62,000 1-5040-0730-05 CL2 System Service CL2 System Service 1-5040-0730-10 Motor Services Electrical Motor Repairs/Services Section Total 1-5040-0750-90 Emergency Equipment Hoses/Fittings/Cabling for Pumps/Generators 1-5040-0810-00 Professional Development $1,600 1-5040-0810-00 Professional Development Training 1-5040-0810-40 Certificate Reimbursement Certificate Reimbursment ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 67 Operation Budget Division Detail (FY 2015/16) SCADA Division Category Total Sub Acct Total Detail Amt 1,500 2,500 1,500 26,00026,000 8,0008,000 29,500 3,500 2,000 4,500 $250 250250 3,0003,000 3,8003,800 850850 2,000 3,000 3,000 2,2002,200 28,00028,000 4,0004,000 4,6504,650 9,5009,500 500 11,000 3,100 1,500 800 3,2003,200 5,5005,500 4,0004,000 5,0005,000 Primary GL CategorySub Acct No./Sub Category Detail Item Description 1-5045-0600-00 Contractual Servcies $31,500 1-5045-0600-30 Warranties & Services Contracts 5,500Cisco Smartnet Premium (for Cisco 1842 Routers) Cisco Smartnet Premium (for Cisco 3825 Router) Dell Servers Service Contract 1-5045-0600-34 Communication LInes Communications Lines 1-5045-0620-00 Data Processing $47,500 1-5045-0620-10 Software Purchases Misc. Software 1-5045-0620-20 Software License Renewals 39,500Wonderware Premium Support PLC Programing Support Proworks32 & Unity SAGE WIN 911 Net DVR 1-5045-0730-30 Cabling & WAN Communcation Contuit Replacement/Wiring Replacement/WAN Com Calibration Supplies 1-5045-0710-78 Meters and Sensors 8,000Integral Manifolds for Flow & Pressure Meters Level Indicators Flow Meters 1-5045-0640-00 Dues, Memberships & 1-5045-0640-00 Dues, Memberships & Intenational Society of Automation 1-5045-0710-00 Materials $15,650 1-5045-0710-60 Hardware Supplies Hardware Supplies 1-5045-0710-64 Electrical Supplies Electrical Supplies 1-5045-0710-72 Calibration Supplies 1-5045-0730-40 Radio Repairs and Servicing Radio Repairs & Servicing 1-5045-0730-45 PLC Hardware 16,900Power Supplies & Components M340 System/PLC's Module Replacements Terminal Blocks/Other Parts Signal Conditioners-Converters 1-5045-0730-62 Instrumentation Instrumentation 1-5045-0730-00 Maintenance $82,950 1-5045-0730-15 Flow Meter Calibration Flow Meter Calibration 1-5045-0730-20 Electrical General Electrical General 1-5045-0730-25 Electrical Motor Control Center Motor Control Center 1-5045-0730-55 Security & Gas Detectors Security & Gas Detectors 1-5045-0730-60 UPS & Back-up Power UPS & Back-up 24VDC Power Systems 1-5045-0730-61 Cooling A/C Servicing Cooling & A/C Service ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 68 Operation Budget Division Detail (FY 2015/16) SCADA Division. Continued Category Total Sub Acct Total Detail Amt 1,0001,000 8,0008,000 1,5501,550 6,5006,500 5,0005,000 5,0005,000 5,8005,800 $300 300300 10,500 11,000 10,000 2,400 1,400 500 $1,400 1,4001,400 $248,200 1-5045-0750-00 Non-Capital Equipment $32,850 1-5045-0750-07 Notebooks Tablet 1-5045-0750-09 Networking Equipment Field Routers, Switches, FIber Device Servers, Mod 1-5045-0750-30 Tools & Equipment Tools & Equipment $31,500 1-5045-0780-20 Software Consulting 31,500PLC Program Cnversions to Unity 1-5045-0750-35 Security Security 1-5045-0750-55 PLCs & Panels PLCs & Panels 1-5045-0750-65 Electrical Upgrades Electrical Upgrades Primary GL CategorySub Acct No./Sub Cate gory Detail Item Description 1-5045-0830-00 Travel & Conferences 1-5045-0830-00 Travel & Conferences AWWA Conference Section Total SCADA System Programing Maintenance PLC - SCADA Modifications 1-5045-0810-00 Professional Development $4,300 1-5045-0810-00 Professional Development 4,300Wonderware Training PLC Programing Training AWWA Training 1-5045-0750-70 Redundant SCADA Radio Systems Communications & Tower 1-5045-0760-00 Office Expense 1-5045-0760-30 Books & Publications Manuals/Books/Magazines 1-5045-0780-00 Professional Services ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 69 Operation Budget Division Detail (FY 2015/16) Mechanical Services Division Category TotalSub Acct Total Detail Amt 30,00030,000 350350 600600 3,0003,000 3,0003,000 500500 400400 8,0008,000 $30,000 30,00030,000 $150 150150 Primary GL CategorySub Acct No./Sub CategoryDetail Item Description 1‐5050‐0645‐00 Fees & Permits $30,950 1‐5050‐0645‐05 AQMD Permits AQMD Permits 1‐5050‐0645‐15 E.P.A.. Fees E.P.A. Fees 1‐5050‐0645‐60 CARB Fees C.A.R.B Fee 1‐5050‐0710‐00 Materials $6,500 1‐5050‐0710‐60 Hardware Supplies Hardware Supplies 1‐5050‐0710‐80 Mech. Shop Supplies Mech. Shop Supplies 1‐5050‐0710‐81 Welding Supplies Welding Supplies 1‐5050‐0750‐00 Non‐Capital Equipment $8,400 1‐5050‐0750‐08 Printers Replacement Printer/Scanner 1‐5050‐0750‐40 Mech Shop Eq uip ment Misc Mech Shop Equipment/Tools 1‐5050‐0780‐00 Professional Services 1‐5050‐0780‐00 Professional Services AQMD Compliance Consultant 1‐5050‐0810‐00 Professional Development 1‐5050‐0810‐40 Certificate Reimbursement Certificate Reimbursment ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 70 Operation Budget Division Detail (FY 2015/16) Mechanical Services Division, Continued Category TotalSub Acct Total Detail Amt 12,13312,133 1,0001,000 9,8009,800 4,0004,000 6,9006,900 2,0002,000 60,00060,000 5,0005,000 53,00053,000 20,10020,100 3,0003,000 500500 12,00012,000 2,0002,000 3,6003,600 1,0001,000 1,0001,000 1,5001,500 1,0001,000 1,4001,400 100,000100,000 20,00020,000 2,0002,000 $398,933 1‐5050‐0890‐30 Engineering ‐ Gas Engineering ‐ Gas 1‐5050‐0890‐31 Engineering ‐ Vehicle Engineering ‐ Vehicle Maint 1‐5050‐0890‐42 OPS ‐ Water ‐ Vehicle OPS Water Vehicle Maintenance 1‐5050‐0890‐43 OPS ‐ Water ‐ Eq uip ement OPS ‐ Water Equipment Maintenance 1‐5050‐0890‐44 OPS ‐ Water ‐ Gas OPS ‐ Water ‐ Gas 1‐5050‐0890‐45 OPS ‐ Water ‐ Diesel OPS ‐ Water ‐ Diesel 1‐5050‐0890‐54 OPS ‐ Mech Svcs ‐ Gas OPS ‐ Mech Svcs ‐ Gas 1‐5050‐0890‐55 OPS ‐ Facilities ‐ Vehicle OPS ‐ Facilities ‐ Vehicle Maint 1‐5050‐0890‐50 OPS ‐ Production Vehicle OPS ‐ Production Vehicle Maint 1‐5050‐0890‐51 OPS ‐ Production OPS ‐ Production Equipment Maint 1‐5050‐0890‐52 OPS ‐ Production ‐ Gas OPS ‐ Production ‐ Gas Section Total 1‐5050‐0890‐00 Vehicle Expenses $322,933 1‐5050‐0890‐10 Admin ‐ Gas Enforcement 1‐5050‐0890‐11 Admin ‐ Vehicle Maint Enforcement 1‐5050‐0890‐20 Finance ‐ Gas Finance ‐ Gas 1‐5050‐0890‐21 Finance ‐ Vehicle Maint Finance ‐ Vehicle Maint 1‐5050‐0890‐71 IT ‐ Gas IT ‐ Gas 1‐5050‐0890‐80 Stationary Engine Maint Primary GL CategorySub Acct No./Sub CategoryDetail Item Description 1‐5050‐0890‐90 Hazardous Materials Haz Mat Disposal Stationary Engine Maint 1‐5050‐0890‐81 Stationary Engine Stationary Engine Emissions Testing 1‐5050‐0890‐56 OPS ‐ Facilities ‐ Gas OPS ‐ Facilities ‐ Gas 1‐5050‐0890‐57 OPS ‐ Tool Repair OPS ‐ Tool Repair 1‐5050‐0890‐70 IT ‐ Vehicle Maint IT ‐ Vehicle Maintenance 1‐5050‐0890‐53 OPS ‐ Mech Svcs ‐ Vehicle OPS Mech Svcs ‐ Vehicle Maint ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 71 Operation Budget Division Detail (FY 2015/16) Facilities Maintenance Division Category Total Sub Acct Total Detail Amt 25,00025,000 7,0007,000 60,00060,000 80,00080,000 3,5003,500 $2,000 2,0002,000 4,0004,000 1,8001,800 1,5001,500 5,0005,000 10,00010,500 6,0006,000 2,0002,000 10,00010,000 10,00010,000 15,00015,000 $2,000 2,0002,000 $90,000 90,00090,000 $335,300 1-5060-0870-00 Utilities 1-5060-0870-10 Electric Electric Section Total 1-5060-0730-66 Asphalt Paving Asphalt Paving 1-5060-0730-67 Concrete Repair Concrete Repair 1-5060-0750-00 Non-Capital Equipment 1-5060-0750-30 Tools & Equipment Tools & Equipment 1-5060-0730-00 Maintenance $53,000 1-5060-0730-00 Maintenance Misc Facility Maint (Doors, fences, etc.) 1-5060-0730-20 Electrical General Electrical Repair Work 1-5060-0730-35 Fire Extinguisher Fire Extinguisher Maint/Calibration 1-5060-0730-50 Painting & Fencing 1-5060-0645-35 Haz Mat Fees (OCFA) Haz Mat Fees (OCFA), Permits Painting & Fence Repair 1-5060-0710-00 Materials $12,300 1-5060-0710-10 Building Repair Parts Building Repair Parts 1-5060-0710-60 Hardware Supplies Hardware Supplies 1-5060-0710-85 Cleaning/Painting Supplies Cleaning /Painting Supplies 1-5060-0710-98 Landscape Supplies Landscape Supplies 1-5060-0645-00 Fees & Permits 1-5060-0600-00 Contractual Services $175,500 1-5060-0600-05 AC & Heating AC & Heating 1-5060-0600-29 Disposal Service Disposal Service 1-5060-0600-35 Janitorial Service Janitorial Service 1-5060-0600-40 Landscape Service Landscape Service 1-5060-0600-45 Pest Control Service Pest Control Service Primary GL CategorySub Acct No./Sub Category Detail Item Description ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 72 Appendix ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 73 List of Acronyms AAR – After Action Report ACP- Asbestos Cement Pipe ACWA- Association of California Water Agencies ACWA/JPIA- ACWA’s Joint Powers Insurance Authority AF (af) - Acre Foot (1af = 325,851 gallons) AFY- Acre Feet per Year (rate of flow) AMP- Asset Management Plan AMS- Angle Meter Stop (Service shut off valve before the meter) AQMD- Air Quality Management District ASCE- American Society of Civil Engineers AWWA- American Water Works Association BEA- Basin Equity Assessment BMP- Best Management Practices BPP- Basin Production Percentage BPS- Booster Pump Station Brown Act- “Ralph M. Brown Act” enacted by the State Legislature governing all meetings of legislative bodies of local agencies CAFR- Comprehensive Annual Financial Report CALFED- The California and Federal Bay Delta Program. Addresses water management issues associated with the Bay Delta System CCR- Consumer Confidence Report ccf- 100 cubic feet (volume equal to approximately 748 gallons of water). Also used as one billing unit. Can also be known as “hcf” CDPH- California State Department of Public Health CEQA- California Environmental Quality Act CERCLA- Comprehensive Environmental Response, Compensation and Liability Act cf- cubic feet (volume equal to 7.48 gallons of water) CFR- Code of Federal Regulations cfs- cubic feet per second (rate of flow) CIP – Capital Improvement Project CIWQS- California Integrated Water Quality Systems COG – Continuity of Government COOP – Continuity of Operations COP – Critical Infrastructure Protection CORPs- United States Army Corps of Engineers CRWUA- Colorado River Water Users Association CSMFO- California Society of Municipal Finance Officers CUWA- California Urban Water Agencies CUWCC- California Urban Water Conservation Council CWEA- California Water Environment Association DIP- Ductile Iron Pipe DO- Dissolved Oxygen DWR- Department of Water Resources (State) ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 74 EMAC – Emergency Management Assistance Compact EOC – Emergency Operations Center EOP – Emergency Operations Plan ERP – Emergency Response Plan EPA- Environmental Protection Agency (Federal) ET- Evapotranspiration Rate (rate water evaporates off plants) ETOR- Employee Time Off Request ETWD- El Toro Water District FEMA- Federal Emergency Management Agency FOG- Fats Oils & Grease Program FTE- Full-Time Equivalent (number of employees) GFOA- Government Finance Officers Association GIS- Geographic Information System GPC- Gallons per Capita GPCD- Gallons per Capita per Day GPM- Gallons per Minute GPS- Global Positioning System GSWC- Golden State Water Company GW- Groundwater GWRS- Groundwater Replenishment System (OCWD Water Treatment System) HP- Horsepower (unit of mechanical energy) IC – Incident Commander ICS – Incident Command System IRWD- Irvine Ranch Water District IW- Import Water KW- Kilowatt (unit of electrical energy) KWh- Kilowatt-hour (rate of energy use or delivery) LBCWD- Laguna Beach County Water District MCL- Maximum Contaminant Level MCWD- Mesa Consolidated Water District Met- Metropolitan Water District of Southern California (aka MWD) MG- Million Gallons mg/l- Milligrams per liter (unit of concentration equivalent to ppm) MGD- Million Gallons per Day MNWD- Moulton Niguel Water District MOA – Memorandum of Agreement MOU – Memorandum of Understanding MWD- Metropolitan Water District of Southern California (aka Met) MWDOC- Municipal Water District of Orange County NIMS – National Incident Management System NPDES- National Pollutant Discharge Elimination Systems NRP – National Response Plan NWS- National Weather Service OA – Operational Area OCSD- Orange County Sanitation District ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 75 OCWD- Orange County Water District PIP- Performance Improvement Plan ppb- parts per billion ppm- parts per million ppt- parts per trillion PRS- Pressure Reducing Station (multiple PRV’s usually in a vault) PRV- Pressure Reducing Valve REOC – Regional Emergency Operations Center RFP – Request for Proposal RO- Reverse Osmosis (treatment) RWQCB- Regional Water Quality Control Board (State) S. A.- Seasonally Adjusted SAR – Santa Ana River SCADA- Supervisory Control and Data Acquisition system SCWD- South Coast Water District SDWA- Safe Drinking Water Act (Federal) SEMS – Standardized Emergency Management System SMWD- Santa Margarita Water District SOC – State Operations Center SOP – Standard Operating Procedure SSMP-Sewer System Management Plans SSO- Sanitary Sewer Overflow SWP- State Water Project TCWD- Trabuco Canyon Water District tds- Total Dissolved Solids ug/l- Micrograms per liter (unit of concentration equivalent to ppb) USGS- United States Geological Survey (Federal) UV- Ultra-Violet Light Radiation (water treatment) UWMP- Urban Water Management Plan VCP- Vitrified Clay Pipe (sewer pipe) WDR- Waste Discharge Requirements (State) WEF- Water Environment Federation (counterpart to AWWA for the wastewater industry) WTP- Water Treatment Plant ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 76 Glossary of Terms Accrual Basis of Accounting: The basis of accounting under which transactions are recognized when they occur, regardless of the timing of cash receipts and disbursements. Acre-Foot: The volume of water that will cover one acre to a depth of one foot. One acre equals 435.6 units or 325,850 gallons. Appropriation: A funding authorization made by the Board, which permits the District to incur obligations and to make expenditures of resources. Assets: Resources owned or held by the District that have monetary value Balanced Budget: Budgeted revenues are sufficient to cover all budgeted expenditures, principle payments on long-term debt, and minimum funding of all reserve requirements as required by the District’s reserve policy. Bond: A written promise to pay a sum of money on a specific date or dates at a specified interest rate. The interest payments and the repayment of the principal are authorized in a District bond resolution. Common types of bonds are General Obligation (GO) bonds and Certificates of Participation (COPs). These are frequently used for construction of large capital projects such as buildings, reservoirs, pipelines and pump stations. California Society of Municipal Finance Officers (CSMFO): A statewide organization servicing all California municipal finance professionals whose purpose is to promote excellence in financial management through innovation, continuing education and the professional development of its members. Capital Budget: The portion of the annual budget that appropriates funds for the purchase of capital equipment items and capital improvements. These expenditures are separated from regular operating items, such as salaries and office supplies. Capital Equipment: Fixed assets such as vehicles, computers, furniture, technical instruments, equipment, etc. which have a life expectancy of more than 2 years and a value of greater than $5,000. Capital Expenditures: Expenditure on an item that meets the meets the District’s $5,000 threshold for capitalization. Also referred to in the Budget as Vehicle and Equipment (See Capital Equipment) ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 77 Capital Improvement: Expenses related to the construction, rehabilitation and modernization of District owned and operated infrastructure. Capital Replacement: Expenses related to major replacements of existing facilities or systems. Certificates of Participation (COP): A long-term debt instrument authorized for construction or acquisition of facilities and equipment. Debt: An obligation resulting from the borrowing of money or from the purchase of goods and services. These include bonds and accounts payables. Debt Service: The District’s obligation to pay the principal and interest of bonds and other debt instruments according to a predetermined payment schedule. Deferred Revenue: Revenue that is not recognized in the period in which received because they are not “available” until a subsequent period. Depreciation: An expense recorded to allocate a tangible asset’s cost over its useful life. Designated: A term that describes assets or equity set aside by action of the Board; as distinguished from assets or equity set aside in conformity with requirements of donors, grantors, or creditors. Enterprise Fund: Fund established to account for the financing of self-supporting enterprises, such as a utility fund, which render services primarily to the public. Expenditures/Expenses: A charge incurred, whether paid or unpaid, for operation, maintenance, interest, and other charges presumed to benefit the current fiscal period. Fiscal Year: A 12-month period of time to which the annual budget applies and at the end of which a government determines its financial position and the results of its operations. The District has specified July 1 to June 30 as its fiscal year. Fund Balance/Fund Equity: See “Net Assets” Geographic Information System (GIS): A system combining computer hardware, software, and geographic data for collecting, storing, analyzing and displaying geographically referenced information. ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 78 Generally Accepted Accounting Principles (GAAP): Accounting and financial reporting standards, conventions, and practices that have authoritative support from standards-setting bodies such as the Governmental Accounting Standards Board (GASB) and the Financial Accounting Standards Board.(FASB). Governmental Account Standards Board (GASB): National advisory board of accounting standards for public agencies. The Board identifies procedures, methods and standards for presenting the financial condition of public agencies. Government Finance Officers Association (GFOA): National organization whose purpose is to enhance and promote the professional management of governments for the public benefit by identifying and developing financial policies and best practices and promoting their use through education, training, facilitation of member networking, and leadership. Groundwater Replenishment Assessment: An assessment paid to Orange County Water District (OCWD) based upon the number of acre-feet of groundwater produced by the District. Infrastructure: The accumulated pipelines and storage facilities of the District, including meters, valves, pumps, filters and other appurtenances, whether constructed by the District or dedicated by private entities. Interest Income: Earnings from the investment portfolio. Liabilities: Present obligations of the District arising from past events. Locke Ranch Assessment: Charges for the Locke Ranch sewer system, which was transferred to the District in 1977. The assessment is imposed pursuant to authority in Water Code Section 31101.5 and adopted in accordance with the requirements of law. The current assessment is $66.00 per year for a residential or equivalent sewer connection and is collected on the Orange County tax roll. Net Assets: The difference between total assets and total liabilities. Increases or decreases in net assets may serve as a useful indicator of whether the financial position of the District is strengthening or weakening. Non-Capital Equipment: Hand tools, furniture and equipment costing $5,000 or less. ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 79 Operating Budget: The portion of the budget that pertains to daily operations that provide basic district services. The operating budget contains appropriations for such expenditures as personnel, supplies, utilities, materials, travel and fuel, and does not include purchases of major capital plant or equipment which is budgeted separately in the Capital Budget. Operating Expenses: All costs associated with the day-to-day business of the District, which are not considered capital improvements or debt repayments. Purchased Import Water: All imported water obtained from Metropolitan Water District of Southern California (MWD) through the Municipal Water District of Orange County (MWDOC). QualServe: A voluntary quality improvement program designed exclusively for water and wastewater agencies. Refunding Revenue Bond: A revenue bond is a long-term municipal debt instrument that is secured by a specified revenue source. A refunding revenue bond is a revenue bond that retires another bond before the first bond matures. Reserve Fund: The District maintains Reserve Funds per the District’s policy for both designated and restricted balances. Designated Reserve Funds are “general use” funds designated by the Board. Restricted Reserve Funds are those that are legally set aside for a particular purpose due to a legal or contractual commitment and cannot be used for any other purpose. Revenue: Monies that the District receives as income. It includes such items as water sales and sewer fees. Estimated revenues are those expected to be collected during the fiscal year. Supervisory Control and Data Acquisition (SCADA): The system that collects operational data from remote units to monitor and control water and wastewater systems and facilities throughout the District service area. Sewer Fund: The fund established to account for the District’s activities of wastewater collection and distribution to Orange County Sanitation District for treatment. Special District: An independent unit of local government organized to perform a single governmental function or a restricted number of related functions. Yorba Linda Water District is organized as a special district. Supplies and Services: The cost of items needed to support the accomplishment of the activities in a department’s programs. ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 80 Uncollectible Accounts: Includes the write-off of unpaid water and sewer charges. User Charge: A charge levied against users of a service or purchasers of a product. Variable Water Costs: Water costs based on a set price per unit but that varies on the quantity of units bought or produced. Variable water costs for the District are related to the quantity of import water that the District purchases and the quantity of ground water pumped from the wells. Vehicle and Equipment Outlay: Purchases of assets, such as vehicles, equipment and furniture, which cost over $5,000 each and are depreciated over their useful life. Water Fund: The fund established to account for the District’s activities relating to the treatment and distribution of potable drinking water and non-potable water to its customers. ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 81 Financial Policies Introduction The District’s financial policy documents incorporate many of the District’s financial management practices that are used by the District staff as guidelines for operational and strategic decision-making related to current and future financial matters. The purpose of establishing these policies is to identify acceptable and unacceptable courses of action, thus establishing parameters in which the District’s fiscal performance can be reviewed. Some policies are flexible when they are utilized by District staff as performance measurement tools to monitor the District’s finances, while others are restrictive to emphasize accountability. The Operating Budget Policy and Revenues and Expenditures Policy are internal documents, acting as a guideline for staff, and are not reviewed by the Board. The Financial Reserves Policy and Investment Policy are reviewed by District staff and Board Members annually, to accommodate minor changes to the existing policy or major shifts in financial priorities as approved by the District’s Board of Directors. The District’s financial policies encompass the following functional areas:  Operating Budget Policy  Revenues and Expenditures Policy  Financial Reserves Policy  Investment Policy ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 82 Operating Budget Policy The operating budget policy answers some basic questions such as: How is the budget developed? Who is involved in the budget process? What does the budget include? Budget Development The District’s budget is developed in accordance with the priorities which are linked to the District’s financial and strategic plans set forth in the District’s mission and long-term goals and objectives. These are found in the District’s strategic plan, the needs of the community, and federal and state laws. Guidelines with respect to the District’s budget are as follows:  The budget should support the District’s mission statement, strategic goals, and critical priorities  There should be no deferment of critical maintenance  The budget should be regarded as a business operating plan  The budget should balance the needs to pay for the District’s cost of providing services, debt service obligation and capital needs of the District  Expenses should be budgeted for in appropriate departments to correctly identify the cost of providing various District functions and services Budget Form The District operating and capital budget is developed on an annual basis. Operating and capital appropriations are approved by the District’s Board of Director’s. Proposed revenues and expenditures including debt service expenditures are presented to the Board of Directors along with comparisons to projected expenditures for the current year and actual expenditures of the prior two years. Basis of Budgeting The accounting for the District is kept on an accrual basis. Revenues are recognized when earned, and expenses are recognized when incurred. The budgeting for the District is kept on an accrual basis, with the exception of supplies & services, which are budgeted on a cash basis. The District is operated as an enterprise fund, which is an accounting entity that finances and accounts for the acquisition, operation and maintenance of governmental facilities and services. It is the District’s intention to recover the full costs of supplying goods and/or services through user-charges. ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 83 The District’s budget process was developed with a series of goals and objectives in mind. These goals and objectives are communicated throughout the organization through several meetings. During the process, the Board of Directors provides priorities and guidelines to the General Manager. The General Manager then discusses Board priorities and other future issues and concerns with Department Heads during staff meetings. Once goals and objectives for the upcoming year are identified, the General Manager and the District staff start developing the District’s budget. Where practical, the District integrates performance measurement, service level, and productivity indicators in the District’s adopted budget document. The District will continue to emphasize the importance of meeting each department’s goals and objectives in order to accomplish its long-term goals and objectives. An increase in the Operating and Capital budget may result in water rate increases. In order to minimize the impact on the District’s rates, revenue requirements are scrutinized to achieve operating efficiencies and maintain or increase customer service at the same time. As part of the cost containment efforts, District staff re-visits operating priorities and reviews internal procedures to included utilizing outside services when they can offer greater competitive advantages to doing it internally, or investing in technology to increase productivity and to reduce the need for additional staff. ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 84 Revenues and Expenditures Policies This policy is used as an aid to provide for the consistent provision of essential public services since revenues and expenditures are the key drivers of the District’s operations. The goal of this policy is to help ensure the financial stability regardless of the economic situation and to provide information to the Board that revenue and expenditure practices are consistent with the District’s mission and goals. Revenues Policy Budgeted revenues are estimated conservatively using an objective and analytical approach using certain techniques such as historical trends and current information to maintain consistency, reliability, and reasonableness. User Charges User charges are the most important component of the District’s revenue portfolio. The District uses user charges to fund the provision of services provided to its customers. The District utilizes a cost recovery component to determine how much costs need be recovered from various customers. The cost of providing various services is used as the basis for setting rates and fees to the various types of customers served. The following are guidelines for the user charge setting process:  User charges are established utilizing a generally accepted cost recovery methodology that is consistent and legally defendable using the following approaches: revenue requirement analysis, cost of service analysis, and rate design analysis.  Rate designs shall be reflective of the District’s Board of Directors’ rate setting objectives.  Rates shall be set at a level so that the District will collect reliable revenues through a combination of system access charges and users’ commodity rates to pay for the District’s revenue requirement.  Rates and charges will be reviewed and updated regularly based on factors such as the impact of inflation, other cost increases, the adequacy of the coverage of costs and requirements of the rate covenant. Expenditures Policy The District’s expenditures reflect the Board of Directors’ and staff commitment to serve present and future customers with reliable public services. The Board and Staff believe that prudent expenditure planning and accountability will ensure fiscal stability. ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 85 Budgeted expenditures are projected conservatively using an objective and analytical approach as well as certain techniques such as historical trends, current information, and economic indicators to maintain consistency, reliability, and reasonableness. The basic components of the District’s expenditure policies are broken down into two functional areas: Maintenance of Capital Assets and Review of Service Maintenance of Capital Assets Maintaining a reliable transmission and distribution system and a sustained capital program are simply not possible without reliable funding sources. For this reason, prudent financial planning is imperative to an effective capital improvement program. The District uses a combination of “pay as you go” method and long term funding to fund the District’s capital improvement program and maintenance of its capital assets. A fixed annual amount was projected by an Asset Management Plan and is included in the District’s Reserve Policy as an annual revenue requirement to be collected from rates and charges. The annual contributions then are accumulated and kept in the District’s capital fund to be spent and withdrawn for the District’s betterment and replacement projects over a period of time. The following elements of expenditure policy reflect the District’s philosophy to perform ongoing maintenance of capital investments once they are purchased and capitalized:  Maintain consistency of allocation of resources for programs to carry out the District’s mission and goals to its customers  Within the resources available each fiscal year, the District shall maintain capital assets and infrastructure at a satisfactory level to protect the District’s investment, to minimize the future replacement and maintenance costs, and to continue service levels. Review of Service These expenditure policies are used by staff to prompt review of services to see if they are being provided as effectively and efficiently as possible. The District’s review of service policy is as follows:  Utilize technology and productivity advancements that will help reduce or avoid increasing personnel costs, when practicable.  Control personnel costs as a proportion of total budget, to more productively and creatively use available resources. ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 86 Financial Reserves Policy A. GENERAL POLICY: Maintaining adequate reserves is an essential part of sound financial management. The Yorba Linda Water District Board of Directors realizes the importance of reserves in providing reliable service to its customers, financing of long-term capital projects and funding availability for emergencies should the need arise. Interest derived from reserve balances shall be credited to the reserve account from which it was earned. B. CATEGORIES: YLWD shall accumulate, maintain and segregate its reserve funds into the following categories: Restricted and Designated Reserves 1. Board Designated Reserves; and 2. Contractually Restricted Reserves. C. SCOPE: This policy will assist the Board of Directors in establishing: 1. Target levels for reserve funds; 2. Requirements for the use of reserve funds; and 3. Periodic review requirements for each reserve. D. PERIODIC REVIEW: Staff and the YLWD Board shall review the reserve balances and targets annually as a part of the annual budget process. The Finance-Accounting Committee will continue to review all reserve and investment balances monthly, with a quarterly report going to the full Board. E. RESTRICTED AND DESIGNATED RESERVES: 1. Board Designated Reserves: These are reserve funds earmarked for the purpose of funding such items as new capital facilities, repair or replacement of existing facilities and general operating reserves designated for a specific purpose and use by the Board of Directors. ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 87 1.0 Operating Reserve A. Definition and Purpose – Established to cover temporary cash flow deficiencies that occur as a result of timing differences between the receipt of operating revenue and expenditure requirements and unexpected expenditures occurring as a result of doing business. B. Target Level – The Government Finance Officers Association (GFOA) recommends that funding should be no less than one to two months (or 8% - 17%) of the District’s annual operating budget. The District’s current target will be a minimum of 8% and a maximum of 17% of the annual operating budget for both the water and sewer funds. C. Events or Conditions Prompting the Use of the Operating Reserve – This reserve may be utilized as needed to pay outstanding operating expenditures prior to the receipt of anticipated operating revenues. 1.1 Emergency Reserve A. Definition and Purpose – Established to provide protection recovery to the District and its customers for losses arising from an unplanned event or circumstance. The reserve level combined with YLWD’s existing insurance policies should adequately protect YLWD and its customers in the event of a loss. B. Target Level – Established at a minimum level equal to $1,000,000 for the water fund and shall accumulate interest and annual contributions as determined by the District’s annual operation to a maximum level of $4,000,000. The target for sewer will be a minimum of $250,000 and a maximum of $1,000,000. C. Events or Conditions Prompting the Use of the Emergency Reserve – This reserve shall be utilized to cover unexpected losses experienced by the District as a result of a disaster or other unexpected loss. Any reimbursement received by the District from insurance companies as a result of a submitted claim shall be deposited back into the reserve as replenishment for the loss. ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 88 1.2 Capital Replacement Reserve A. Definition and Purpose – Established to provide capital repair and replacement funding as the District’s infrastructure deteriorates over its expected useful life. B. Target Level – The Board-approved 2010 Asset Management Plan recommended that the annual contribution to this reserve be at a minimum level of $1,820,000 for the water fund and $345,000 for the sewer fund, less money set aside for the Maintenance Reserve. Funding with available funds based on the District’s operations shall be allocated quarterly. C. Events or Conditions Prompting the Use of the Capital Replacement Reserve – Through the annual budget process, staff shall recommend anticipated asset replacement projects. The Board of Directors shall take action to approve recommended project appropriations from the capital replacement reserve. Should unplanned replacement be necessary during any fiscal year, the Board of Directors may take action to amend the budget and appropriate needed funds as required. 1.3 Maintenance Reserve A. Definition and Purpose – Established to provide funding for non-scheduled capital asset repair and replacement. B. Target Level – $200,000 subject to an annual review. C. Events or Conditions Prompting the Use of the Maintenance Replacement Reserve – Unplanned failure of assets including but not limited to pumps, motors and major facility repairs. 1.4 Debt Service Reserve A. Definition and Purpose – Established to provide funding for semi-annually scheduled debt service payments. B. Target Level – The District’s highest annual debt service payment – currently $2,723,509. C. Events or Conditions Prompting the Use of the Debt Service Reserve – Semi- annual debt service payments will be made out of this fund, with funding on the water rate replenishing the fund annually. ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 89 1.5 Employee Liabilities Reserve A. Definition and Purpose – The purpose is to cover employees’ accrued vacation and other compensatory time and to ensure the complete funding associated with the liability incurred for employees whom have met the requirements necessary for district paid health benefits at retirement. B. Target Level – The annual contribution will be $100,000 ($93,000 for water and $7,000 for sewer) to be evaluated and/or adjusted annually thereafter based on an analysis of current employees’ vacation and sick time accrued and actuarial determinations of future retiree costs. As of November 2, 2011, an actuary determined that the District’s Other Post Employment Benefit (OPEB) liability was $1,433,197. When combined with a liability on the District’s books for vacation, compensatory and sick time of $1,063,572 at June 30, 2012, the target is projected to be approximately $2,500,000 for the combined water and sewer enterprises. C. Events or Conditions Prompting the Use of the Employee Liabilities Reserve – This reserve may be used in the event that operating funds are not adequate to meet vacation, compensatory and sick time paid out or retiree medical cost obligations within the current year. 2. Contractually Restricted Reserves: These are funds held to satisfy limitations set by external requirements established by creditors, grant agencies or law. Examples include stipulated bond covenants and reserves held with a fiscal agent. 2.0 US Bank 2008 COP Reserve A. Definition and Purpose – Established to cover reserve requirements held with a designated fiscal agent (US Bank) for the 2008 Certificates of Participation. B. Target Level – Funding shall be held in an amount equal to $2,147,096. C. Events or Conditions Prompting the Use of the Contractually Restricted Reserve – This reserve may be utilized as needed by the fiscal agent to pay any outstanding debt service payments not covered by the District within the specified billing and due dates. ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 90 C. SCOPE: This policy will assist the Board of Directors in establishing: 4. Target levels for reserve funds; 5. Requirements for the use of reserve funds; and 6. Periodic review requirements for each reserve. D. PERIODIC REVIEW: Staff and the YLWD Board shall review the reserve balances and targets annually as a part of the annual budget process. The Finance-Accounting Committee will continue to review all reserve and investment balances monthly, with a quarterly report going to the full Board. E. RESTRICTED AND DESIGNATED RESERVES: 1. Board Designated Reserves: These are reserve funds earmarked for the purpose of funding such items as new capital facilities, repair or replacement of existing facilities and general operating reserves designated for a specific purpose and use by the Board of Directors. ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 91 Investment Policy SECTION 1: GENERAL POLICY 1.1 It is the policy of the Yorba Linda Water District (“District”) to invest public funds in a manner which ensures the safety and preservation of capital while meeting reasonably anticipated operating expenditure needs, achieving a reasonable rate of return and conforming to all state and local statutes governing the investment of public funds. 1.2 The purpose of this policy is to provide guidelines for the prudent investment of funds of the District and to outline the policies for maximizing the efficiency of the District’s cash management. The District’s goal is to enhance the economic status of the District consistent with the prudent protection of the District’s investments. This investment policy has been prepared in conformance with all pertinent existing laws of the State of California. SECTION 2: SCOPE 2.1 This Investment Policy applies to all funds and investment activities of the District, except for the proceeds from capital project financing instruments, which are invested in accordance with provisions of their specific documents. These funds are accounted for as Enterprise Funds and are identified in the District’s Comprehensive Annual Financial Report. SECTION 3: DELEGATION OF AUTHORITY 3.1 The authority of the Board of Directors to invest funds is derived from Section 53601 of the California Government Code (“CGC”). Section 53607 of the CGC grants the Board of Directors the authority to delegate that authority, for a one- year period, to the District’s Treasurer. Therefore, management responsibility for the investment program is hereby delegated to the District’s Treasurer, who shall be responsible for all transactions undertaken and shall establish a system of controls to regulate the activities of subordinate officials and their procedures in the absence of the Treasurer. The Treasurer shall establish procedures for the management of investment activities, including the activities of staff consistent with this Policy. ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 92 3.2 The Treasurer may retain the services of an outside investment advisor or manager as approved by the Board to assist with the District’s investment program. Any investment advisor selected shall make all investment decisions and transactions in strict accordance with State law, and this Policy. SECTION 4: INVESTMENT OBJECTIVES 4.1 The primary objectives, in priority order, of the District’s investment activities shall be: 4.1.1 Safety: Safety and preservation of principal is the foremost objective of the investment program. Investments shall be selected in a manner that seeks to ensure the preservation of capital in the District’s overall portfolio. This will be accomplished through a program of diversification and maturity limitations, more fully described in Section 13, in order that potential losses on individual securities do not exceed the income generated from the remainder of the portfolio. 4.1.2 Liquidity: The District’s investment portfolio will remain sufficiently liquid to enable the District to meet all operating requirements which might be reasonably anticipated. Securities should mature concurrent with cash needs to meet anticipated demands. 4.1.3 Return on Investments: The District’s investment portfolio shall be designed with the objective of attaining the best yield or returns on investments, taking into account the investment risk constraints and liquidity needs. Return on investment is of secondary importance compared to the safety and liquidity objectives. SECTION 5: PRUDENCE 5.1 The standard of prudence to be used by the designated representative shall be the “prudent investor” standard and shall be applied in the context of managing the overall portfolio. The meaning of the standard of prudent investor is explained in CGC Section 53600.3, which states that “when investing, reinvesting, purchasing, acquiring, exchanging, selling or managing public funds, a trustee shall act with care, skill, prudence, and diligence under the circumstances then prevailing, including, but not limited to, the general economic conditions and the anticipated needs of the agency, that a prudent person acting in a like capacity and familiarity with those matters would use in the conduct of ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 93 funds of a like character and with like aims, to safeguard the principal and maintain the liquidity needs of the agency.” 5.2 The Treasurer and delegated investment officers, acting in accordance with District procedures and the Policy and exercising due diligence, shall be relieved of personal responsibility for an individual security’s credit risk or market price changes, provided deviations from expectations are reported in a timely fashion and appropriate action is taken to control adverse developments. 5.3 Investments shall be made with judgment and care - under circumstances then prevailing - which persons of prudence, discretion and intelligence exercise in the management of their own affairs, not for speculation, but for investment, considering the probable safety of their capital as well as the probable income to be derived. SECTION 6.0: ETHICS AND CONFLICTS OF INTEREST 6.1 Officers and employees involved in the investment process shall refrain from personal business activity that could conflict with proper execution of the investment program, or which could impair their ability to make impartial investment decisions. Employees and investment officials shall disclose to the District’s General Manager any material financial interests in financial institutions that conduct business with the District’s boundaries, and they shall further disclose any large personal financial/investment positions that could be related to the performance of the District. SECTION 7: AUTHORIZED BROKER/DEALERS 7.1 The Treasurer will maintain a list of authorized broker/dealers and financial institutions that are approved for investment purposes. Broker/dealers will be selected for credit worthiness and must be authorized to provide investment services in the State of California. These may include “primary” dealers or regional dealers that qualify under Securities & Exchange Commission Rule 15(C)3-1 (uniform net capital rule). No public deposit will be made by the broker/dealer except in a qualified public depository as established by the established state laws. Before a financial institution or broker/dealer is used, they are subject to investigation and approval by the Treasurer or his/her designated representative, and must submit the following: 7.1.1 Certification of having read and understood this investment policy resolution and agreeing to comply with the District’s investment policy; 7.1.2 Proof of Federal Investment Regulatory Authority certification; ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 94 7.1.3 Proof of State of California registration; 7.1.4 Audited financial statements for the institution’s three (3) most recent fiscal years; 7.1.5 References of other public-sector clients that similar services are provided to. 7.2 If a third party investment advisor is authorized to conduct investment transactions on the District’s behalf, the investment advisor may use their own list of approved independent broker/dealers and financial institutions. The investment advisor’s approved list must be made available to the District upon request. SECTION 8: AUTHORIZED INVESTMENTS 8.1 The District is provided a broad spectrum of eligible investments under the CGC Sections 53601 et seq. Authorized investments shall also include, in accordance with CGC section 16429.1 et seq., investments into the Local Agency Investment Fund (LAIF) and the Orange County Treasurer’s Commingled Investment Pool in accordance with CGC section 53684. Within the investments permitted by the CGC, the District seeks to further restrict eligible investment to the investments listed in Section 8.3 below. Percentage holding limits listed in this section apply at the time the security is purchased. Ratings, where shown, specify the minimum credit rating category required at purchased without regard to +/- or 1,2,3 modifiers, if any. 8.2 The purchase of any investment permitted by the CGC, but not listed as an authorized investment in this Policy is prohibited without the prior approval of the Board of Directors. 8.3 Within the context of these limitations, the following investments are authorized: ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 95 TABLE 1 Permitted Investments*/ Deposits CA Government Code % of Portfolio Limits / Maturity Limits YLWD % of Portfolio Limits / Maturity Limits Bank Deposits# No % limit, 5 years No % limit, 5 years CD Placement Service# 30% limit, 5 years 30% limit, 5 years Local Agency Investment Fund (LAIF)^ No % or maturity limit No % or maturity limit County Pooled Investment Funds^ No % or maturity limit No % or maturity limit Joint Powers Authority Funds (CalTRUST & CAMP)^ No % or maturity limit No % or maturity limit U.S. Treasury Obligations No % limit, 5 years No % limit, 5 years U.S. Agency Obligations No % limit, 5 years No % limit, 5 years Negotiable Certificates of Deposit# 30% portfolio, 5 years 30% portfolio, 5 years Money Market Funds* 20%, 10% per issuer, no limit 20%, 10% per issuer, no limit Medium-Term (or Corporate) Notes* 30% portfolio, 5 years 30% portfolio, 5 years Bankers Acceptances* 40%, 30% per issuer, 180 days 10% max, 5% per issuer, 180 days Commercial Paper* 25%, 10% per issuer, 270 days 25% max, 5% per issuer, 270 days * Please see Appendix A for more detailed descriptions and additional restrictions ^ Please see Section 10 for additional restrictions # Please see Section 11 for additional restrictions ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 96 SECTION 9: REVIEW OF INVESTMENT PORTFOLIO 9.1 The securities held by the District must be in compliance with Section 8 Authorized Investments at the time of purchase. The Treasurer shall at least quarterly review the portfolio to verify that all securities are in compliance with Section 8 Authorized Investments. In the event a security held by the District is subject to a credit rating change that brings it below the minimum credit ratings specified in Appendix A Authorized Investments, the Treasurer should notify the Finance-Accounting Committee - and through the Committee’s minutes, the Board - of the change. The course of action to be followed will then be decided on a case-by-case basis, considering such factors as the reason for the change, prognosis for recovery or further rate drops, and the market price of the security. SECTION 10: INVESTMENT POOLS 10.1 A thorough investigation of any investment pool or mutual fund is required prior to investing, and on a continual basis. The investigation will, at a minimum, obtain the following information: 10.1.1 A description of eligible investment securities, and a written statement of investment policy and objectives; 10.1.2 A description of interest calculations and how it is distributed, and how gains and losses are treated; 10.1.3 A description of how the securities are safeguarded (included the settlement processes), and how often the securities are priced and the program audited; 10.1.4 A description of who may invest in the program, how often and what size deposit and withdrawal are allowed; 10.1.5 A schedule for receiving statements and portfolio listings; 10.1.6 Are reserves, retained earnings, etc. utilized by the pool/fund; 10.1.7 A fee schedule and when and how it is assessed; 10.1.8 Is the pool/fund eligible for bond proceeds and/or will it accept such proceeds. ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 97 SECTION 11: COLLATERALIZATION 11.1 Bank Deposits: Under provisions of the CGC, California banks and savings and loan associations are required to secure the District’s deposits by pledging eligible securities with a value of 110% of principal and accrued interest. State law also allows financial institutions to secure District deposits by pledging first trust deed mortgage notes having a value of 150% of the District’s total deposits. 11.2 Waiver of Security: The Treasurer, at his/her discretion and in accordance with CGC section 53653, may waive security for the portion of any deposits as is insured pursuant to federal law. SECTION 12: SAFEKEEPING AND CUSTODY 12.1 All security transactions entered into by the District shall be conducted on a delivery-versus-payment basis. Securities will be held by a third party custodian designated by the Treasurer and evidenced by safekeeping receipts. The only exception to the foregoing shall be depository accounts and securities purchases made with (i) local government investment pools, and (ii) money market mutual funds, since those purchased securities are not deliverable. SECTION 13: DIVERSIFICATION AND MAXIMUM MATURITIES 13.1 The District will diversify its investments by security type and institution. With the exception of U.S. Treasuries, U.S. Agency Securities, FDIC Insured Certificates of Deposit and authorized pools, no more than 30% of the District’s total investment portfolio will be invested in a single security type or with a single financial institution. 13.2 To the extent possible, the District will attempt to match its investments with anticipated cash flow requirements. Unless matched to a specific cash flow and approved in advance by the Board of Directors, the District will not directly invest in securities maturing more than 5 years from the date of purchase. SECTION 14: INTERNAL CONTROLS 14.1 The external auditors will annually review the investments and general activities associated with the investment program. This review will provide internal control by assuring compliance with the Investment Policy and District policies and procedures. ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 98 SECTION 15: PERFORMANCE STANDARDS 15.1 The investment portfolio will be designed with the objective of obtaining a rate of return throughout budgetary and economic cycles, commensurate with the investment risk constraints and the cash flow needs. 15.2 The District’s investment strategy is passive. The performance of the District’s investment portfolio will be evaluated and compared to an appropriate benchmark in order to assess the success of the investment portfolio relative to the District’s Safety, Liquidity and Return on Investments objectives. This review will be conducted annually with the Finance-Accounting Committee. SECTION 16: REPORTING 16.1 Subject to CGC sections 53607 and 53646(b), the Treasurer will provide monthly investment reports to the District’s Finance-Accounting Committee (and through the Committee’s minutes, to the Board of Directors) and quarterly reports to the Board of Directors which provide a clear picture of the status of the current investment portfolio. The reports shall comply with the reporting requirements of CGC sections 53607 and 53646(b), respectively. SECTION 17: INVESTMENT POLICY ADOPTION 17.1 The District’s Investment Policy will be adopted by resolution of the Board of Directors. The policy will be reviewed on an annual basis and modification, if any, must be approved by the Board of Directors. ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 1 To the Honorable Board of Directors: We are pleased to present the Yorba Linda Water District FY 2015/16 Draft Budget. The purpose of this document is to identify and allocate the resources needed to accomplish the District’s goals and objectives over the next fiscal year and to present the financial health of the District in a clear and concise manner to the Board of Directors and the general public. The main objective of the proposed Yorba Linda Water District FY 2015/16 budget is to provide adequate funding for all District activities, considering the goal of meeting all regulatory requirements while providing reliable, high quality water and sewer services in an environmentally responsible and financially prudent manner. The proposed budget meets this objective by incorporating operating cost reductions and the use of available financial reserves, while projecting realistic operating revenues without a supplement from the currently approved rate increases. The following are highlights of achievements completed in FY 2014/15; a summary of the goals and objectives for FY 2015/16 and a financial forecast of the District heading into the next five fiscal years: FY 2014/15 Highlights & Accomplishments Capital Improvement & Replacement Projects Completed • Completed Yorba Linda Blvd. Booster Pump Station • Completed Deville Drive Water Line Extension • Completed Lakeview Grade Separation Pipeline Replacement • Completed Orangeview Waterline Extension • Completed Yorba Linda High School Park Pipeline Relocation Projects in Planning, Design or Commencing Construction • Received Conceptual Approval from OCWD for Well #22 Site • Completed Design Fairmont Booster Pump Station Replacement • Completed Design of Richfield Road Pipeline Other District Activities & Accomplishments • Received Positive Auditor’s Letter for FY 2013/14 • Received State and National Recognition for FY 2013/14 CAFR • Received State and National Recognition for FY 2014/15 Budget document • Executed Multi-Year Memorandum of Understanding (MOU) With the YLWD Employees Association • Received the CSDA Certificate of Transparency • Established Water Use Restrictions and Drought Penalties to Comply with State of California Mandate – YLWD Ordinance No. 15-01 Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 2 FY 2014/15 Financial Forecast For the year ending June 30, 2015, staff is anticipating a combined loss of $2,057,622 for the water and sewer enterprises. These figures include total depreciation expenses (a non-cash expense) in the amount of $7,354,700. Please refer to the Summary of Total Revenue and Expenses (Water & Sewer) for supporting information. Beginning July 1, 2014, total reserve funds available for both Operations and Capital Projects was $29.4 million. Staff is forecasting these funds to be $32.6 million by June 30, 2015, for a total addition of $3.2 million for FY 2014/15. Principal Issues, Factors & Challenges for FY 2015/16 For the forthcoming 2015/16 fiscal year, the Yorba Linda Water District will be experiencing one of its greatest challenges in meeting the Governor’s April 1, 2015 Executive Order issuing mandatory water conservation regulations across the state. The subsequent Regulations approved by the State Water Resources Control Board (SWRCB) on May 6, 2015, mandated a conservation reduction (of water use) for YLWD of 36%, comparative to 2013 usage for the period of June 1, 2015 through February 31, 2016. In response to these events, YLWD Board of Directors adopted Resolution No. 15-04 Instituting Stage 3 of the District’s Conservation Ordinance and Ordinance No. 15-01 Instituting Drought Penalties, both to promote conservation efforts by our customer base. As a result of the SWRCB mandated 36% District-wide conservation reduction established for YLWD, there is a projected budget decrease of 29% in water sales for FY 2015/16 as compared to FY 2014/15. Prior to the Governor’s Executive Order, the District was engaged in a Water and Wastewater Rate Study as authorized by the Board. The study explored gradually shifting more of the customer’s average monthly bill to the basic service charge over a five year period. The intent was to stabilize revenues and meet the District’s cost of service as water conservation efforts continue to be necessary. Unfortunately, due to the Emergency Drought Mandates implemented in May of 2015, which far exceeded the forecasted conservation targets set by the District’s imported water supplier, Metropolitan Water District of Southern California (MWD), this gradual shift to increase the basic service fee will need to be consolidated into the first year, effective October, 1 2015. Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 3 Additionally the Emergency Mandates require the establishment of drought rates or administrative penalties to impose upon customers who exceed water use restrictions set forth by the SWRCB. The District elected to implement administrative penalties based on reductions comparative to the calendar year 2013 average usage for each of the three customer classes - residential, commercial and irrigation. The collection of these proposed administrative penalties are not for the purpose of recovering the cost of providing water service to District customers, but rather to signal higher than average users of water they need to conserve more. As of May 2014, the District was granted annexation of the remaining 26% of its service area into the Orange County Water District (OCWD). It was anticipated that with full annexation the District will be able to pump the maximum groundwater allowable each year, at a lower cost than purchasing the same amount of import (MWD) water. However, the District will not be able to take advantage of full annexation for FY 2015/16, due to the 2003 Conjunctive Use Program (CUP) Agreement and due to the need to complete construction of capital facilities. The CUP Agreement requires the District to withdraw 1,596 acre-feet over and above OCWD’s Basin Production Percentage (BPP) for the upcoming fiscal year and pay for the water at current import water rates, after subtracting power and operations and maintenance charges of $110 per acre-foot. The CUP allows MWD to “store” water in the Orange County Groundwater Basin and call for the extraction of that water, via wells purchased for various agencies, in times of drought when its traditional sources (the Colorado River and Bay-Delta) are less plentiful. Current facility (infrastructure) limitations prevent the District from producing and transferring the full BPP as well as the required CUP obligation. Had the District been able to access the entirety of the BPP in the upcoming fiscal year, the District could potentially lower its variable water costs by approximately $1 million. As later described in this document, the District’s Capital Improvement Program includes construction of pumping, pipeline and well facilities over the next three years that will make it possible for the District to access its full allotment of groundwater. FY 2015/16 Goals & Objectives Key Business Objectives • Evaluate and Update the Financial Reserves Policy to Improve Resiliency During Drought and Decreasing Water Sales Conditions • Revise Business Model to Achieve Cost Recovery of Approximately 40% of Operations and Maintenance Costs with Base Fee and to Reduce Reliance on Volumetric Revenue • Reduce Reliance on Import Water Supply • Perform Analysis and Update of Fee Schedule • Improve Accountability of Water Use and Compliance with District Regulations Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 4 • Implement Conservation and Enforcement Programs to Support Emergency Drought Condition • Continue Implementation of the District’s Computerized Maintenance and Management System (CMMS) • Implement Increased Distribution System Leakage Detection and Prevention • Consider Opportunities for Expanded Sewer Service Area • Update Current Job Descriptions (District-wide) • Identify Key Roles for Succession • Conduct Leadership Training to Improve Organizational Effectiveness and Efficiency • Update and Enhance Website to Provide a Better Customer Experience • Implement Communication Campaign to Educate Customers about Value of Water Capital Improvement & Replacement Projects • Complete Construction of Well #21 Project • Complete Construction of Richfield Road Pipeline • Begin Construction of Fairmont Booster Pump Station Project • Commence CEQA and Design of Well 22 Project • Complete Update of Urban Water Management Plan • Begin In-House Preparation of Updated Water Master Plan • Complete In-House Design Plans & Specifications for Next Phase of Water Line Replacement Program FY 2015/16 Summary Budget Revenues Total water and sewer revenues budgeted for upcoming FY 2015/16 amount to $32.5 million, a decrease of $415,000 from the revenues budgeted for FY 2014/15. Budgeted revenues include the projected increase in Service Charges as a result of the Water Rate Study and Administrative Penalties assessed due to excessive water usage. The major differences are comprised of the following: Water Revenue ($580,000 decrease) The decrease in Water Revenue is a result of the net effect of projected conservation efforts to meet the SWRCB mandated reduction in consumption and the projected results from the Water and Wastewater Rate Study that will establish an increase on monthly base fee charges to District customers. Water Revenue from Residential, Commercial, and Landscape/Irrigation consumption is projected to decrease by $6.4 million (30%) in FY 2015/16 as a result of District-wide conservation efforts. As a projection of the results from the Water and Wastewater Rate Study, Service Charges for all customers are projected to increase by $4.9 million for FY 2015/16. Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 5 Sewer Charge Revenue ($34,000 decrease) Sewer Charge Revenue funds help to finance maintenance equipment, system repairs, replacements and improvements associated with the sewer system. This revenue is expected to remain relatively constant. Expenses & Outlay Total expenses & outlay (excluding capital projects) budgeted for upcoming FY 2015/16 is $37.6 million, an increase of $1 million from the FY 2014/15 budgeted results. This includes depreciation which totals $7.4 million. The following factors summarize the significant changes: Variable Water Costs ($2,849,000 decrease) The District's variable water costs will decrease by 19% in FY 2015/16. In response to the SWRCB’s mandated conservation reduction for YLWD of 36%, the District’s Production Operating Plan is projecting to generate a total demand of 16,534 AF in FY 2015/16 – a reduction of 5,446 AF from FY 2014/15. The operating plan for FY 2015/16 increases its annual ground water allocation to 60.9% - up by 6.2% from FY 2014/15. The cost per AF for ground water of $322/AF averages to be $613/AF less than the cost of import water per AF. Salaries & Benefits ($589,000 increase) This amount includes the hiring of additional staff, merit increases and reclassifications for those employees who may qualify throughout the year, a Cost of Living Adjustment (COLA) as indicated in the District’s MOU and Compensation letters, increases from CalPERS, medical, dental, and vision premiums, and the assumption that all funded positions will be filled for an entire fiscal year. The FY 2015/16 budget for merit increases for those employees who qualify throughout the year, amounts to approximately $39,000. The Salaries & Benefits budget also includes the addition of two full-time employees and 4 part-time employees, as well as one proposed reclassification of current employee. Salaries relating to CIP projects, in the amount of $135,000, will also be capitalized. The net operating costs for salaries and benefits results in a $589,000 increase from the FY 2014/15 budget. The District has three tiers for retirement benefits through the California Public Employees’ Retirement System (CalPERS): Tier 1 applies to District employees hired prior to January 26, 2012. These employees pay the full employee contribution rate, which is 7% of pensionable compensation and are enrolled in the 2% at 55 CalPERS retirement formula. Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 6 Tier 2 applies to District employees hired between January 26, 2012 and December 31, 2012, and any District employees hired on or after January 1, 2013 who are defined as “classic members” under the Public Employees’ Retirement Law. These employees pay the full employee contribution rate, which is 7% of pensionable compensation and are enrolled in the 2% at 60 CalPERS retirement formula. Both tier 1 and tier 2 retirement benefits are based on the employee’s single highest year of compensation. These employees are covered under the Fourth Level of 1959 Survivor Benefits. Tier 3 applies to District employees hired on or after January 1, 2013 who are “new members” as defined in the Public Employees’ Pension Reform Act of 2013 (PEPRA). These employees pay an initial contribution rate of one-half of the total normal cost of the defined benefit plan and are enrolled in the 2.5% at 67 CalPERS retirement formula. The retirement benefit for these employees is based on an average of three years of final compensation. Commencing July 1, 2015, District employees will receive a Cost-of-Living increase of 6.5% which will be spread over the course of the next three fiscal years. The District will continue to match dollar for dollar of salary earned, not to exceed 2% per payroll period of the employee’s deposits into a qualified Deferred Compensation Plan for any Management or Supervisory/Confidential employee. The District pays 100% of the premium cost for health, dental and vision for all full-time employees and two-thirds of the premium cost for their dependents; offers employees a “4/10” work schedule; an optional 457 deferred compensation plan; a 125 Flex benefits plan; Long and Short Term Disability Insurance; Life Insurance; an Employee Assistance Program; and Tuition Reimbursement. Employees accrue 3.077 hours per pay period of vacation with increases in vacation accruals at 5, 10, 15 and 20 years. After 20 years, the maximum vacation accrual is reached at the rate of 6.922 hours per pay period. There are 26 pay periods per year. Sick leave is accrued at the rate of 3.7 hours per pay period. The District observes eleven paid holidays per year. Reserves and Funding Sources The District has nine water and sewer enterprise-related funding sources. Within the budget document is a summary of these funding sources and their associated balances. Three of these funds are restricted or designated specifically for capital projects including: COP Bonds 2008, Water Capital Projects and Sewer Capital Projects. Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 7 Both the Water Emergency and the Sewer Emergency Funds are non-restricted and were established to fund unplanned, unbudgeted emergency operations repairs related to the water and sewer system, respectively. The Water Emergency Fund was established in FY 2009/10, with a transfer of $2 million from the Annexation Fund. The Sewer Emergency Fund was established in FY 2007/2008, with the Board of Directors’ decision that approximately $1 per connection per month would be set to fund this account. The Board also established at that time a Sewer Emergency Fund ceiling guideline of $1 million, after which any additional revenue generated would be transferred to Sewer Capital Reserves. The remaining three funds are the Water Restricted for Debt Service Fund, which is used to pay the Districts principal and interest payments and the Water and Sewer Operating Funds which are used to fund day-to-day operations and maintenance activities as identified in the budget, which occur as actual expenses. These activities require cash, checks and wire transfers on a regular basis and affect the District’s cash flow. Summary The Water Enterprise is budgeted with a FY 2015/16 loss of $3.8 million under the proposed budget, which includes a proposed rate increase and variable water cost pass-through, and with depreciation of $6 million. This does not include CIP project expenditures, which are funded separately with capital reserves and other identified funds. The Sewer Enterprise is budgeted with a FY 2015/16 loss of $1.3 million, with depreciation of $1.3 million. This also does not include CIP project expenditures, which will require funding from capital reserve funds and operating fund transfers. The State-wide mandated water use restrictions by the SWRCB will pose challenges for all water providers in the coming years. Continuous and effective communications on the many changing issues facing the District is essential as we adapt our business model to these drought conditions and imposed mandates. The challenges presented this year were met by the Yorba Linda Water District’s Board of Directors’ resolve to keep the stability and financial strength of the District as one of its highest priorities. This budget reflects the vision of the Board of Directors of the Yorba Linda Water District, its management, and its employees. We will continue to strive to make improvements in our budget processes, including an extensive review and analysis of projections for revenues, expenditures, capital projects, and reserves. Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 8 I would like to thank all the staff involved in this process for the efforts put forth in the preparation of this budget to ensure a successful outcome. To the Board of Directors, we acknowledge and appreciate their continued support and direction in achieving excellence in financial management and District operations. Respectfully Submitted, Marc Marcantonio General Manager Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 1 Budget Overview Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 2 Resolution to Adopt Budget RESOLUTION NO. 15-16 RESOLUTION OF THE BOARD OF DIRECTORS OF THE YORBA LINDA WATER DISTRICT ADOPTING THE BUDGET FOR FISCAL YEAR 2015/16 AND RESCINDING RESOLUTION NO. 14-08 WHEREAS, the Yorba Linda Water District has prepared a one year budget for Fiscal Year 2015/16; and WHEREAS, on July 8, 2015, the proposed “Draft” Budget for Fiscal Year 2015/16 was presented and reviewed at a meeting of the Board of Directors of the District; and WHEREAS, the “Final” Budget for Fiscal Year 2015/16 was presented and considered by the Board of Directors at a regular meeting on July 9, 2015; and WHEREAS, it is the desire of the Board of Directors to adopt the Budget for Fiscal Year 2015/16, and rescind Resolution No. 14-08. NOW THEREFORE BE IT RESOLVED by the Board of Directors of the Yorba Linda Water District as follows: Section 1. That the Budget for Fiscal Year 2015/16, set forth in Exhibit “A” attached hereto, is hereby approved and adopted. Section 2. The Budget for Fiscal Year 2015/16 is in full force and effect beginning July 1, 2015, and continuing until this Resolution is rescinded by the Board of Directors. Section 3. That Resolution No. 14-08 is hereby rescinded effective July 1, 2015. PASSED AND ADOPTED this 9th day of July 2015, by the following called vote: Ric Collett, President Yorba Linda Water District Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 3 Mission & Vision Statement 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.” Our Vision “Yorba Linda Water District will become the leading, innovative and efficient source for high quality reliable services.” Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 4 Core Values Statement The Yorba Linda Water District Board of Directors and staff are guided in everything we do by the following core values: Integrity– We demonstrate integrity every day by practicing the highest ethical standards and by ensuring that our actions follow our words. Accountability– We acknowledge that both the Board and the staff of the District are accountable to the public that we serve, as well as to each other. Responsibility– We take full responsibility for our actions- both our successes and our opportunities for growth. We maintain a commitment of courtesy, assessment and resolution with all customer concerns. Transparency – We promote a culture where we actively listen to our customers and communicate openly about our policies, processes and plans for the future. Teamwork – Success centers on all departments working together and sharing information and resources to achieve common goals. We are dedicated to ensuring that every voice of the District, from the Board to each individual employee is treated with dignity and respect, and that differences are valued and individual abilities and contributions are recognized. Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 5 Strategic Goals Statement *The following Strategic Goals Statement is subject to revision following implementation of a new business model and Board of Directors planning workshop. The Government Finance Officers Association (GFOA) recommends that all governmental entities use some form of strategic planning to provide a long-term perspective for service delivery and budgeting, thus establishing logical links between authorized spending and broad organizational goals. The goals, objectives and action steps within the District’s Strategic Plan were determined by the mission and vision statements and core values of the District and further established through the process initiated by the Board of Directors through a Strategic Plan Workshop. Stakeholders that participated in this process included all five Board Members, the Executive Management team and members of the Employee Productivity-Innovation-Communications (EPIC) Committee, made up of staff representatives with varied levels of experience and expertise from across all District departments. In the District’s strategic planning, goals are defined as identified challenges the District would like to address. Initiatives are defined as high-level concepts or plans for resolving the identified goals. Strategies are defined as action steps to achieving the identified initiatives, which, in turn, achieve the identified goals. Five goals were identified as the most critical challenges for the District to address in the next year: Goal CP: Community Partnership Goal FR: Fiscal Responsibility Goal OE: Operational Efficiency Goal SR: Service Reliability Goal WE: Workforce Engagement Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 6 Goal CP: Community Partnership As a public agency, the District is expected to demonstrate the prudent use of public funds. The District’s services should provide tangible benefits that are of value to the community. Strengthening existing relationships with key stakeholders, including customers and agency partners, while demonstrating our dedication to transparency in the most professional manner, is paramount. Initiatives Strategies Enhance Resources for Public Information & Governmental Affairs Division Develop a Public Relations Master Plan with Measurable Goals Have Board of Directors and YLWD Staff Attend More Events and Inter-governmental Meetings within the Local Community Continue to Support Regional Training and Multi-Agency Workgroups through the Joint Use of the Administration Building Effectively Use Broad Spectrum Communication Opportunities CP 1: Increase Brand Recognition within the Community CP 2: Increase Public Awareness of Water and Wastewater Related Issues CP 1-A CP 1-B CP 1-C CP 1-D CP 1-E CP 1: Increase Brand Recognition within the Community Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 7 Provide Financial Incentives and Rebates for Water Use Efficiency Develop and Expand a Youth Education Program Consider Participation in the California Urban Water Conservation Council’s Best Management Practices Enhance the District’s Regional Water and Wastewater Industry Participation Maintain a Commitment to Updating the District’s Rules and Regulations Pertaining to Water, Sewer & Special District Best Practices Goal FR: Fiscal Responsibility The District is ranked highly by financial ratings organizations, has proven to be a good financial steward, and consistently strives for a clear, well-documented budget process and clean annual financial audit. However, with the state and national economic crisis, the District has an even greater responsibility to demonstrate effective and responsible use of public funds while responding to ever-increasing financial challenges. Initiatives CP 2: Increase Public Awareness of Water and Wastewater Related Issues CP 2-A CP 2-B CP 2-C CP 2-D FR 1: Maintain Fiduciary Responsibility FR 2: Increase Reserve Funding FR 3: Identify and Develop Additional Revenue Options FR 4: Provide an Equitable Rate Structure CP 2-E Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 8 Strategies Develop a Comprehensive Multi-Year Financial Plan Prepare a High Level Annual Budget Document and Comprehensive Annual Financial Report and Compete for Recognition by the Government Finance Officers Association Revise the Water and Sewer Rules and Regulations and Evaluate Fee Schedules Regularly for Proper Cost of Service Coverage Evaluate and Revise the Sewer Fund Allocation Maintain Commitment to a Strong Debt Services Ratio Continue to Record and Report the Fairly Stated Financial Activities of the District in a Timely and Transparent Manner to the Board of Directors and Member Agencies Review the Reserve Policy and Funding Levels Annually Analyze the Asset Management Plan to Determine Future Asset Replacement Needs Implement an Approach to Ensure Reserves are Responsibly Funded FR 1-A FR 1-C FR 1: Maintain Fiduciary Responsibility FR 2: Increase Reserve Funding FR 2-A FR 2-B FR 2-C FR 1-D FR 1-E FR 1-B FR 1-F Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 9 Research and Obtain Grant Funding Whenever Feasible Review Opportunities to Earn “Cash-Back” on Operating Expenses through Commercial Credit Card Accounts Manage Cash Flow to Maximize Investment Income Complete the Cost of Service and Water Rate Study Evaluate Equitable Rate Structures that Promote Conservation and Efficiency Goal OE: Operational Efficiency The District has provided independent, trusted and reliable service for more than one hundred years, yet it recognizes the importance of continual improvements to increase operational efficiency. Initiatives OE 1: Optimize Use of Existing Technologies OE 2: Address Inefficiencies Identified in the Self-Assessment Survey OE 3: Consider Utilization of a Peer Review Survey FR 3-A FR 3-B FR 4-A FR 4-B FR 3: Identify and Develop Additional Revenue Options FR 4: Provide an Equitable Rate Structure FR 3-C Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 10 Strategies Identify the Current Functionality of Existing Technology and Determine if it is Being Utilized to Full Capacity Evaluate How Each Department Might Make Further Use of Existing Technology Provide Support and Encourage Employee Training Improve connectivity for Computerized Maintenance and Management System (CMMS) Improve Internet and Intranet Access Availability by Increasing Bandwidth Integrate GIS with Hydraulic Model, CMMS, Valve Exercise, and Hydrant Flushing Improve Radio Communications Adopt GIS Data Maintenance and Request Procedures Implement Field GIS software (Underground Service Alert, As-built Lining and Red-lining) Convert Transferred Sewer Lines into GIS Install a Reliable Backup Power System at Remote Control Sites OE 1-A OE 1-B OE 1-C OE 1: Optimize Use of Existing Technologies OE 1-D OE 1-E OE 1-F OE 1-G OE 1-H OE 1-I OE 1-J OE 1-K Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 11 Initiate a Comprehensive Backup Work Toward Implementation of a District-Wide Paperless Processing System Identify Core Inefficiencies Develop Measurable Productivity Goals Engage Employees in Methods of Addressing Inefficiencies Determine the Cost Benefit Ratio of a Peer Review Survey Establish a Team to Determine the Focus of the Survey Institute Guidelines for Areas to Be Addressed Goal SR: Service Reliability The ultimate purpose of District assets and infrastructure is to safely and reliably provide vital services to the public. Our goal is to maintain all assets for optimal continuity of District services. Effective management of assets involves monitoring asset conditions against the level of service to manage risk of failure, planning for future financial needs and anticipating uncertainties or changing levels of service. OE 2: Address Inefficiencies Identified in the Self-Assessment Survey OE 2-A OE 2-B OE 2-C OE 3: Consider Utilization of a Peer Review Survey OE 3-A OE 3-B OE 3-C OE 1-L OE 1-M Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 12 Initiatives Strategies Continue with Efforts to Annex District Service Area to Orange County Water District Forecast Service Demand Projections Engage with Regional Agencies on Water Supply Issues Strengthen Existing Emergency Operations Partnerships Develop 1 Additional Well Site Evaluate Alternative Water Sources SR 1: Work Toward Service Reliability and Efficiency SR 2: Explore Service Boundary Opportunities SR 3: Complete Implementation of Capital Improvement Project Plan 2011-2015 SR 1-A SR 1-F SR 1: Work Toward Service Reliability and Efficiency SR 1-B SR 1-C SR 1-D SR 1-E Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 13 Evaluate Feasibility of Providing Additional Water Services within the Region Evaluate Feasibility of Providing Additional Wastewater Services within the Region Evaluate Feasibility of Providing Other Professional Services within the Region Complete Implementation of Five Year Capital Improvement Plan from FY 2011-2015 with adopted amendments Continue Planning for Long Term Capital Improvements and Replacements into the future SR 2: Explore Service Boundary Opportunities SR 2-A SR 2-B SR 3: Complete Implementation of Capital Improvement Project Plan 2011-2015 SR 3-A SR 3-B SR 2-C Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 14 Goal WE: Workforce Engagement The District is known for its highly skilled staff and quality work. In order to retain a highly productive and proficient workforce, maintaining and building on employee engagement in the District will be critical to future success. With uncertain economic times to continue in the near term, however, greater calls for efficiency and responsiveness will require staff to be flexible and prepared to demonstrate effectiveness and accountability. Initiatives Strategies Maintain Competitive Compensation via Classification and Compensation Surveys Explore Alternative Benefits Establish Career Development Expectations of Existing Employees Develop Methodologies to Assist Employees in Attaining Career Expectations Continue to Support Additional Training for Staff WE 1: Retain a Highly Skilled and Capable Workforce WE 2: Develop a Comprehensive Succession Plan WE 3: Enhance Employee Relations WE 1-A WE 1-B WE 1-C WE 1: Retain a Highly Skilled and Capable Workforce WE 1-D WE 1-E Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 15 Encourage Staff Participation in Professional Organizations and Local Civic Groups Execute Timely and Consistent Employee Performance Evaluations Identify Key Roles for Succession Define the Competencies and Motivational Profile Required for Key Roles Identify Individuals with the Potential to Perform Highly in Key Roles Develop Methodologies to Assist Employees in Preparing for Advancement Implement a Program to Recognize Employees for Excellence Conduct Bi-Yearly All Hands Meetings Continue to Encourage Employee Training in Leadership and Technology WE 2: Develop a Comprehensive Succession Plan WE 2-B WE 2-C WE 3: Enhance Employee Relations WE 3-A WE 3-B WE 3-C WE 2-A WE 2-D WE 1-F WE 1-G Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 16 Profile of the District Independent, Trusted and Reliable Service for more than 100 Years The Yorba Linda Water District is an independent special district, which operates under the authority of Division 12 of the California Water Code. The Yorba Linda Water District has been providing water and sewer services to the residents of the City of Yorba Linda, portions of Placentia, Brea, Anaheim, and nearby unincorporated areas since 1959, the year it was formed to take over the assets and water service responsibilities of the Yorba Linda Water Company, a mutual company formed in 1909. The District is governed by a five-member Board of Directors, elected at large from within the District’s service area. The General Manager administers the day-to-day operations of the District in accordance with policies and procedures established by the Board of Directors. The Yorba Linda Water District employs a full-time staff of 80 employees and a part-time staff of 4 employees. The District’s Board of Directors meets on the second and fourth Thursday of each month. Meetings are publicly noticed and citizens are encouraged to attend. The District provides water, sewer or a combination of both services to residents and businesses within its service area, which includes approximately 14,475 acres of land comprising 22.6 square miles. The District serves a population of approximately 70,000 and currently provides water service through approximately 24,703 residential, commercial, and light industrial connections. District Services Residential customers make up approximately 93% of the District’s customer base and consume approximately 72% of the water provided annually by the District. The District's drinking water comes from two sources: local groundwater and "imported water". Approximately 60% comes from local groundwater and 40% comes from "imported water" from the Colorado River via the Colorado River Aqueduct and from Northern California via the State Water Project. The blending of these sources varies according to your geographic location within the District. This District operates and maintains 10 ground water wells which pump water from the Orange County Water Basin to our customers in the northern and western portions of the District’s service area. This portion of the District accounts for approximately 60% of the District’s overall water demands. The production of each well can range from 1200 gallons per minute (GPM) to 3200 GPM. The water production is dependent on the overall condition of the ground water basins. For 2015/16 we are projecting to pump approximately 13,300 acre feet of ground water or 62% of our total projected water demands from the ground water basin. The groundwater basin is managed by the Orange County Water District (OCWD), who allows more than 20 cities and water Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 17 agencies, including YLWD, to withdraw water from the basin, via wells, at a cost of approximately $322 per acre-foot. OCWD sets a maximum percentage of water that can be pumped from the ground, the Basin Production Percentage (BPP). The remainder of YLWD's drinking water is "imported" water, purchased through the Municipal Water District of Orange County (MWDOC). MWDOC, in turn, purchases water from the State Water Project and the Colorado River Aqueduct, as part of a consortium of 26 agencies, through the Metropolitan Water District of Southern California (MWD). The cost of imported water to the retail agencies, such as YLWD, is almost four times the cost of pumping out of the groundwater basin. Imported water is treated at MWD's Diemer Filtration Plant, located on Valley View and Diemer Road in Yorba Linda. The majority of YLWD's operating expenses are variable water costs, which include purchasing water from both OCWD and MWDOC, as well as electrical and natural gas costs to pump water up to the highest elevations. The District delivers water to approximately 24,000 customers within our service area which boarders Chino Hills State Park to the north and the Santa Ana River to the south encompassing the cities of Yorba Linda, portions of Placentia, Brea, Anaheim and unincorporated Orange County. Our complex system of pipes, valves, pressure control stations, pump stations and reservoirs are strategically located throughout our service area so that we can provide reliable, high quality drinking water to our customers. The current system has the capacity to store approximately 57 million gallons of water in its reservoirs, can produce 45 million gallons per day through its wells and import water connections, while maintaining industry standards for water quality and pressures. Almost ten years ago the District began a $95 million dollar “fast track” capital improvement program aimed at an infrastructural overhaul to ensure water reliability for our customers, and to meet current and anticipated consumption and financial demands. The program includes the construction of water wells, reservoirs, pipelines and booster pumping stations as well as various other system improvements. These systems improvements will allow greater access to groundwater throughout our service area and have the potential to reduce variable costs approximately $1 million per year. In addition, the ability to access groundwater provided by these upgrades serves to better prepare the District in the event of scheduled and unscheduled MWD shutdowns. Historically, YLWD rates have been among the lowest in Orange County, and continue to be so for the upcoming year. In fiscal year 2012/13 and 2013/14, the District purchased 21,788.7 acre-feet and 22,645.8 acre-feet of water to provide to customers, respectively. Fiscal year 2015/16 is forecasted to provide 16,534 acre-feet. Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 18 Personnel Trends by Position Changes and Trends: The part-time Public Information Assistant has now been replaced by a full time Public Affairs Representative. In response to the Emergency Drought Declaration by the State the following limited-term positions have been added: a full-time Water Conservation Supervisor and 4 part-time Water Conservation Representatives. Position/Title 2011-122012-132013-14 2014-15 Proposed 2015-16 ADMINISTRATION Executive Secretary1 1 1 1 1 General Manager1 1 1 1 1 Legislative Affairs Intern 0.5 0.5 --- Management Analyst1 1 1 1 1 Public Affairs Intern0.5 0.5 0.5 -- Public Affairs Representative----1 Public Information Assistant---0.5 - Public Information Manager1 1 1 1 1 Records Management Clerk --0.5 -- Records Management Spec ialist ---1 - W ater Conservation Representative ##----2 W ater Conservation Supervisor #----1 Total Administration 5.0 5.0 5.0 5.5 8 ENGINEERING Associate Engineer---1 1 Contruction Inspector1 1 1 1 1 Contruction Project Supervisor--1 1 1 Engineering Manager1 1 1 1 1 Engineering Secretary1 1 1 -- Engineering Technician II2 2 2 2 2 Project Coordinator--1 -- Project Engineer2 2 --- Senior Construction Inspector1 1 1 1 1 Senior Project Manager 1 1 1 1 1 Water Quality Engineer 1 1 1 1 1 Water Quality Technician II 1 1 1 1 1 Total Engineering 11 11 11 10 10 # Limited-term position in response to Emergency Declaration of Drought by State ## Limited-term positions in response to Emergency Declaration of Drought by State - Enforcement Staff Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 19 Changes and Trends: The Human Resources Technician has been promoted to a Human Resources Analyst. A Records Management Administrator was added for FY 2015-16. The Records Management Specialist was reassigned to the Human Resources Department. The SCADA Administrator and Instrumentation Technician were reassigned from the IT Department to the Operations Department. Position/Title 2011-122012-132013-14 2014-15 Proposed 2015-16 FINANCE Accounting Assistant I1 1 1 1 1 Accounting Assistant II 1 1 1 1 1 Customer Service Rep I 1 1 1 -- Customer Service Rep II 1 1 1 2 2 Customer Service Rep III 2 2 2 2 2 Customer Service Supervisor 1 1 1 1 1 Finance Director ----- Finance Manager 1 1 1 1 1 Meter Reader I 2 2 2 1 1 Meter Reader II 2 2 2 2 2 Meter Services Lead 1 1 1 1 1 Senior Accountant 1 1 1 1 1 Total Finance 14 14 14 13 13 HUMAN RESOURCES Human Resources Analyst 1 1 1 1 2 Human Resources Clerk --0.5 -- Human Resource & Risk Manager 1 1 1 1 1 Human Resource Technician --1 1 - Personnel Technician 1 1 --- Records Management Administrator ----1 Records Management Specialist #----1 S afety Training Technician --1 1 1 Total Human Resources 3 3 4.5 4.0 6.0 INFORMATION TECHNOLOGY GIS Administrator1 1 1 -- GIS Analyst---1 1 GIS Technician 0.5 0.5 0.5 -- Information Systems Administrator 1 1 1 1 1 Information Systems Technician I 1 1 1 1 1 Information Systems Technician II 1 1 --- Instrumentation Technician 1 1 1 1 - IT Manager 1 1 1 1 1 SCADA Administrator 1 1 1 1 - Programmer Analyst --1 1 1 Total Information Technology 6.5 6.5 7.5 7.0 5.0 # Records Management Specialist reassigned to Human Resources Department for FY 2015/16. Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 20 Changes and Trends: The SCADA Administrator and Instrumentation Technician were reassigned from the IT to the Operations Department in FY 2015/16. For FY 2015/16 4 Limited- term Part-time and 1 Limited-term Full-time employees (total of 3 FTE employees) have been added in response to the Emergency Declaration of Drought by the State. Position/Title 2011-122012-132013-14 2014-15 Proposed 2015-16 OPERATIONS Chief Plant Operator1 1 1 -- Facilities Maintenance 1 1 1 1 1 Instrumentation Technician ----1 Maintenance Distribution Operator II 8 8 8 8 8 Maintenance Distribution Operator III 4 4 4 4 4 Maintenance Worker I 9 9 9 9 9 Mechanic II 1 1 1 1 1 Mechanic III 1 1 1 1 1 Office Clerk ---1 1 Operations Assistant --1 -- Operations/ Warehouse Assistant ---1 1 Operations Assistant/Storekeeper 1 1 --- Operations Manager 1 1 1 1 1 Plant Operator II 3 3 3 3 3 SCADA Administrator ----1 Sr Maintenance Distribution Operator 4 4 4 4 4 Senior Fleet Mechanic 1 1 1 1 1 Senior Plant Operator 1 1 1 1 1 Water Maintenance Superintendant 1 1 1 1 1 Water Production Superintendant - - - 1 1 Total Operations 37 37 37 38 40 # SCADA Administreator and Instrumentation Technician reassigned to Operations Department from IT Department for FY 2015/16. DISTRICT TOTAL (FTE)76.5 76.5 79.0 77.5 82.0 Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 21 Personnel Trends by Department Department 2011-12 2012-132013-14 2014-15 Proposed 2015-16* Administration 5 5 5 5.5 8 Engineering 111111 10 10 Finance 141414 13 13 Human Resources 3 3 4.5 4 6 Information Technology 7.57.57.5 7 5 Operations 373737 38 40 DISTRICT DEPARTMENT TOTALS 77.577.57977.582 * Includes 1 Limited-term FT and 4 Limited-term PT employees ( 3FTE employees) in response to State's Emergency Drougt Declaration Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 22 Financial Policies & Goals This section includes a brief summary of the District’s Operating Budget Policy, Revenue and Expenditure Policy, Reserve Policy, and Investment Policy. Though each financial policy is reviewed annually, only the District’s Investment Policy is updated and adopted by the Board on an annual basis. Operating Budget Policy The District’s budget is developed in accordance with the priorities which are linked to the District’s financial and strategic plans set forth in the District’s mission and long-term goals and objectives. These are found in the District’s comprehensive master plans, the long term financial plan, the needs of the community, and federal and state laws. The District operating and capital budget is developed on an annual basis. Operating and capital appropriations are approved by the District’s Board of Director’s. A balanced budget is defined as the amount of budgeted expenditures is equal to or less than the amount of budgeted revenue, plus available fund balance. The accounting for the District is kept on an accrual basis. Revenues are recognized when earned, and expenses are recognized when incurred. The budgeting for District expenses, with the exception of supplies and services, is on an accrual basis. Supplies and services are budgeted on a cash basis. The District is operated as an enterprise fund, an accounting entity which finances and accounts for the acquisition, operation, and maintenance of governmental facilities and services. It is the intention of the District to recover the full costs of providing maintenance, goods, and/or services through the collection of user charges. Revenue and Expenditure Policy Budgeted revenues are estimated conservatively using an objective and analytical approach using historical trends and current information to maintain consistency, reliability, and reasonableness. The District’s expenditures reflect the Board of Directors’ and staff commitment to serve present and future customers with reliable public services. The Board and staff believe that prudent expenditure planning and accountability will ensure fiscal stability. Budgeted expenditures are projected conservatively using an objective and analytical approach as well as certain techniques such as historical trends, current information, and economic indicators to maintain consistency, reliability, and reasonableness. Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 23 Reserve Policy This policy represents the public affirmation of the Board’s commitment to the financial prudence and careful stewardship of community assets. This policy covers: Operating Reserve (target level of 8%-17% of annual operating budget); Emergency Reserve (target level between $1 and $4 million for water fund and $250,000 and $1 million for sewer fund); Capital Replacement Reserve (target level of $1.82 million for water fund less money set aside for Maintenance Reserve and $345,000 for sewer fund); Maintenance Reserve (target level of $200,000); Debt Service Reserve (target level of highest annual debt service payment); Employee Liabilities Reserve (annual contribution of $100,000) and US Bank 2008 COP Reserve (target level of $2,147,096). These funds are designated by the District’s Board to carry out specific purposes to ensure prudent management of District’s financial resources and are used by District’s staff as parameters within which the Board expects staff to operate. The Financial Reserve Policy has three primary goals:  To preserve the financial stability of the District against present and future uncertainties in an ever-changing environment  To maintain the District’s bond ratings in the capital markets and sustaining debt covenant compliance  To provide adequate funding to meet the District’s short-term and long-term plans and commitments to its customers All reserve balances will be subject to review by the Board of Directors on an annual basis as part of the budget process. Investment Policy It is the policy of the District to invest funds in a manner that will provide the highest investment return with the maximum security while meeting the daily cash flow demands of the District and conforming to all statutes governing the investment of the District funds. The policy follows the “prudent investor” standard of the California Government Code Section 53600.3 and is updated and formally adopted by the District on an annual basis. Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 24 Basis of Budgeting & Accounting The accounting for the District is kept on an accrual basis. Revenues are recognized when earned, and expenses are recognized when incurred. The budgeting for District expenses, with the exception of supplies and services, is on the accrual basis. Supplies and services are budgeted on the cash basis of accounting. The District is operated as an enterprise fund, which is an accounting entity that finances and accounts for the acquisition, operation and maintenance of governmental facilities and services. It is the District’s intention to recover the majority of the costs of the acquisition, operation, and maintenance of governmental facilities through user- charges and the receipt of property taxes. Budget Controls When the Fiscal Year 2015-16 Operating and Capital Budget is approved by the Board, budgeted amounts are appropriated and expended within each department. Subject to the approval of the annual budget by the Board of Directors, the General Manager has full charge and control of the District’s expenditures to ensure that operating and capital expenditures in each fiscal year are within the budgetary guidelines and to ensure that the District’s goals and objectives are met. Developing and monitoring the budget is an ongoing process. Monthly reports of expenses and revenues compared to the budget are developed to provide a method for ongoing review at the department. The Board is presented unaudited financial statements in the CAFR format to review, receive and file for each reporting quarter. Throughout the year, Finance and other department managers will review actual results of operating expenditures as compared to the budgeted amounts approved by the Board of Directors in June 2015. The General Manager has the authority to make administrative adjustments to the budget as long as those changes will not have a significant policy impact nor affect the budgeted year-end fund balances. Any significant program changes or service level changes require approval by the Board of Directors. All budget transfers are documented and tracked within the Finance Department. Review and adjustments to the capital budget appropriations are also recommended throughout the fiscal year. Project managers may find that some projects contemplated at the beginning of the fiscal year have been delayed or accelerated due to changes in conditions, weather and/or economics, and new projects may be added to meet future demands, goals and objectives. Any recommended changes to the Capital Improvement Budget would be brought to the Board of Directors for approval. Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 25 Resolutions adopted by the Board of Directors are required for authorizing positions in the service of the District and for setting salary ranges for those authorized positions. The General Manager is authorized to use savings from vacant authorized positions to retain contract labor to meet District personnel needs. The General Manager is also authorized to fill an approved and budgeted position that is vacated during the term of the budget year with a new employee at an equal or lower classification. The budget may need to be modified to reflect labor and benefit agreements. These changes would be approved by the Board of Directors. As defined by the District’s Purchasing Policy, in the event that the General Manager determines that an emergency exists and requires immediate action, the General Manager shall have the power, without prior Board action, to enter into contracts and agreements and expend funds on behalf of the District beyond the final approved fiscal year budget in an amount not to exceed $100,000. Those amounts shall be ratified at the next meeting or at the earliest special meeting that can be called. Amounts in excess of $100,000 require Board of Director approval and shall be formally ratified at the next meeting or at the earliest special meeting that can be called. Budget Process The budget process begins in January of each year and is the product of a comprehensive team effort from various levels within the organization, as shown on the following Budget Calendar. Each year, the Finance Department prepares expenditure budget worksheets for distribution to key staff. These worksheets give staff the necessary information to project their department’s budgets by category. Included in the worksheets are the past year’s actual expenses, current year transactions, and projected current year end balances. Based on the information provided, and accounting for any changes for anticipated purchases, the requested amounts from the worksheet are entered into the budget system and compared to last year’s budget. Any substantial budget change needs to be justified by the respective departments. The Human Resources Department reviews the employee positions and wages of the District. The Human Resources Department makes a recommendation to the General Manager if new positions need to be added, changes in job descriptions need to occur, or reclassifications of position are required. The results of this review are presented to the Board of Directors for further input and approval. The approved personnel recommendations are entered into the budget system for inclusion in the budget document. Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 26 The Engineering Department prepares a list of CIP projects to be presented to the Board of Directors. Based on recommendations from staff, each CIP project will be prioritized based on necessity. The Engineering Department will also update the future project list and will incorporate cost changes due to construction cost increases or a change in the scope of the project. The method to determine the revenue projections takes into account factors such as projected growth, required conservation, historical activity, and the current economic conditions. Once all the components have been calculated, each department presents their departmental budget to the General Manager and Management Team for review. Comments and changes that are recommended by staff are included in a draft document that is then presented to the Board of Directors in a public forum for review and comment. Once all approved changes have been incorporated into the draft document, a final budget is then presented to the Board of Directors for adoption. Developing and monitoring the budget is an ongoing process. Monthly reports of expenses and revenues compared to the budget are developed to provide a method for ongoing review at the department level. The Board is presented unaudited financial statements in the CAFR format to review, receive and file for each reporting quarter. Revenue Assumptions The main source of Operating Revenue for the District is water and sewer rate revenue. However, rate revenue is not enough to fund the total cost of operations and must be supplemented by a variety of miscellaneous/other operating revenues. Other operating revenues include items such as customer service fees, unmetered jumpers, and other sources. Total operating revenues are projected to decrease at a rate of 1.2% in FY 2015/2016. Water operating revenues as a result of water sales are estimated to decrease by 1.9% to $28,623,519 in FY 2015/16. This estimated decrease is deflated due to the inclusion of projected increases in revenues as a result of the Water Rate Study and assessed Administrative Penalties for excessive water usage. Sewer operating revenues are estimated to decrease by 1.2% to $1,822,139 in FY 2015/16. Water Operating Fund Potable Water sales are the largest source of District revenues, with the majority of sales to residential customers. In previous years, mild weather conditions, less that desirable economic conditions, and a strong water conservation message have resulted in lower consumption demand and thus lower than anticipated water revenues. In the current year, due to the Governor’s official Declaration of Drought and mandated conservation reduction for YLWD of 36%, comparative to calendar year 2013, set by the Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 27 SWRCB, the District is budgeting for at a 29% conservation reduction of current forecasted usage. There is no tiered water rate structure at YLWD. Therefore, Water Revenues are calculated using the average number of units consumed per customer account, a proposed monthly fixed charge per account, and a proposed $2.70 per billing unit consumed (which is 100 cubic feet (ccf) or approximately 750 gallons). The result is then annualized for the budget projection. The budget assumes a yearly demand of 16,534 acre feet (AF) in FY 2015/16. The chart below displays the historical trend of water revenue. Revenue from Service Charges is a calculation of the projected number of service connections for FY 2015/16 (24,703) multiplied by the proposed fixed service charge based on meter size. Other Income Revenues, which include but are not limited to backflow charges, unmetered jumpers, construction meters, new account fees, and other income, are projected based upon historical activity and current economic conditions. Included in Other Income Revenues for FY 2015/16, in response to the SWRCB’s Emergency Drought, are revenues collected in the form of administrative penalties imposed upon District customers who exceed water use restrictions. Interest Income for the water operating funds is projected based on an average yield of 0.6% on the District’s portfolio. Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 28 Property Tax Income is projected based on the assumptions of the Orange County Tax Assessor. The District anticipates receiving 97% of its share of the ad valorem tax revenue, which will result in a 1% increase when compared to the previous year. Other Non-Operating Revenue, which include but are not limited to annexation fees, rental income, and other sources, are projected based upon historical activity and current economic conditions. Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 29 Sewer Operating Fund The District’s Sewer Revenues are based on the sewer collection services provided to our customers. Sewer maintenance charges will remain fixed at $5.50 per month for single family residential customers with associated charges for multi-family and commercial accounts. The District will provide sewage collection services for approximately 25,300 sewer service connections. Other Income Revenues, which include but are not limited to sewer collection fees and miscellaneous income, are projected based upon the historical activity and current economic conditions. Interest Income for the sewer operating funds is projected based on an average yield of 0.6% on the District’s portfolio. Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 30 Cost Allocation The allocation of costs are derived from cost accounting. Cost accounting is defined as the process of tracking, recording and analyzing costs associated with the products or activities of an organization. The costs of operating expenses including employee wages and benefits are allocated to each department and division, based on actual expenses as tracked by the District’s accounting system. The District’s budget is presented with an allocation of 93% to the Water Fund and 7% to the Sewer Fund, with the exceptions of the Water Production, Water Operations, and Mechanical Services sections which are allocated 100% to the Water Fund. Additionally, the Sewer Operations section, which includes sewer-related expenses including vehicle maintenance, is allocated 100% to the Sewer Fund. The methodology used to determine the allocation percentages involved discussions with personnel from each department where they were to identify a basis for each section by which an allocation percentage could be used. This analysis concluded that the allocation percentage described above was appropriate. Costs associated with capital projects are tracked by the means of assigned “Job Numbers”. Salaries affiliated with capital projects are allocated to the appropriate CIP accounts based on actual timesheet entries. An overhead of approximately 33% is applied to the allocated salary costs by job number in order to provide a true salary and benefit cost applicable to CIP projects. Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 31 Chart of Major Funds Structure (FY 15/16) Water Sales Service Charges Property Tax Interest Income Other Income Sewer Service Charges Water Fund Sewer Fund District Operations & Maintenance Activities Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 1 FINANCIAL SUMMARIES Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 2 Total Revenue and Expenses (Water & Sewer) FY 2012/13 Actual FY 2013/14 Actual FY 2014/15 Budget FYE 2014/15 Forecast FY 2015/16 Budget Revenue (Operating): Water Revenue (Residential)16,596,680$ 17,502,293$ 17,154,552$ 15,909,458$ 11,472,028$ Water Revenue (Commercial & Fire Det.)1,890,269$ 1,984,096$ 2,074,097$ 1,941,531$ 1,385,979$ Water Revenue (Landscape/Irrigation)4,161,528$ 4,543,942$ 4,792,995$ 4,203,144$ 2,782,183$ Service Charges3,721,462$ 4,341,965$ 4,478,000$ 4,988,739$ 9,426,652$ Sewer Charge Revenue1,561,850$ 1,565,548$ 1,605,292$ 1,588,680$ 1,584,348$ Sewer Parcel Assessments200,189$ 201,054$ 201,000$ 194,895$ 201,500$ Other Operating Revenue *723,577$ 1,047,625$ 719,777$ 1,298,393$ 3,592,969$ Total Operating Revenue 28,855,555$ 31,186,523$ 31,025,713$ 30,124,841$ 30,445,658$ Revenue (Non-Operating): Interest 137,569$ 145,048$ 112,000$ 144,679$ 93,000$ Property Tax 1,340,916$ 1,394,722$ 1,283,642$ 1,454,342$ 1,395,000$ Other Non-Operating Revenue 588,854$ 1,325,685$ 533,525$ 708,584$ 607,155$ Total Non-Operating Revenue2,067,339$ 2,865,455$ 1,929,167$ 2,307,604$ 2,095,155$ Total Revenue 30,922,894$ 34,051,978$ 32,954,880$ 32,432,445$ 32,540,813$ Expenses (Operating): Variable Costs 13,509,336$ 14,673,144$ 14,928,972$ 13,850,950$ 12,080,410$ $ Salary Related Expenses 7,225,729$ 7,529,481$ 8,509,812$ 7,997,942$ 8,870,465$ Salary Related Expenses - Limited-term Staff -$ -$ -$ -$ 228,753$ Reduction for Capital Project Labor -$ -$ (285,000)$ (183,975)$ (135,000)$ Salary Related Expenses Total7,225,729$ 7,529,481$ 8,224,812$ 7,813,967$ 8,964,218$ Supplies & Services: Communications199,150$ 214,663$ 294,894$ 195,376$ 301,525$ Contractual Services476,369$ 567,131$ 560,700$ 501,014$ 586,155$ Data Processing133,426$ 158,102$ 186,830$ 160,331$ 233,829$ Dues & Memberships57,402$ 67,531$ 78,065$ 76,732$ 115,110$ Fees & Permits **188,354$ 183,295$ 186,190$ 176,405$ 2,926,665$ Board Election-$ -$ 75,000$ -$ -$ Insurance257,274$ 271,117$ 313,340$ 262,518$ 296,340$ Materials752,538$ 714,625$ 658,125$ 700,876$ 795,950$ District Activities, Emp Recognition21,423$ 16,018$ 24,710$ 13,758$ 29,110$ Maintenance457,663$ 403,054$ 507,021$ 524,010$ 747,345$ Non-Capital Equipment182,845$ 138,443$ 152,000$ 135,632$ 167,750$ Office Expense42,343$ 41,465$ 40,475$ 41,452$ 42,850$ Professional Services906,818$ 532,899$ 711,610$ 479,211$ 644,710$ Training25,106$ 34,071$ 65,180$ 46,822$ 75,015$ Travel & Conferences25,461$ 29,453$ 46,500$ 39,084$ 98,480$ Uncollectible Accounts36,383$ 29,632$ 40,000$ 35,600$ 40,000$ Utilities 92,333$ 38,201$ 90,800$ 81,402$ 90,850$ Vehicle Expenses 367,510$ 409,483$ 358,400$ 356,998$ 372,433$ Supplies & Services Sub-Total 4,222,398$ 3,849,183$ 4,389,840$ 3,827,221$ 7,564,117$ Total Operating Expenses 24,957,463$ 26,051,808$ 27,543,624$ 25,492,138$ 28,608,745$ Expenses (Non-Operating): Interest Expense 1,781,416$ 1,715,429$ 1,780,793$ 1,714,192$ 1,655,685$ Other Expense 228,364$ 47,948$ 72,000$ 9,250$ 22,000$ Total Non-Operating Expenses 2,009,780$ 1,763,377$ 1,852,793$ 1,723,442$ 1,677,685$ Total Expenses 26,967,243$ 27,815,185$ 29,396,417$ 27,215,580$ 30,286,430$ Net Income Before Capital Contributions3,955,651$ 6,236,793$ 3,558,463$ 5,216,865$ 2,254,384$ Extraordinary Item-$ 5,000,000$ -$ -$ -$ Capital Contributions 1,174,673$ 2,128,579$ -$ 80,212$ -$ Net Income Before Depreciation5,130,324$ 13,365,372$ 3,558,463$ 5,297,077$ 2,254,384$ Depreciation6,884,213$ 7,315,084$ 7,337,500$ 7,354,700$ 7,350,000$ Income (Loss)(1,753,889)$ 6,050,288$ (3,779,037)$ (2,057,622)$ (5,095,616)$ * Line item includes potential Administrative Penalties assessed to District Customers for excessive water use. YLWD Ordinance No. 15-01. ** Line item includes potential Adminstrative Penalties/Fees that may be assessed on YLWD from SWRCB. Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 3 Total Revenue and Expenses (Water & Sewer), Continued Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 4 Total Revenue and Expenses (Water) FY 2012/13 Actual FY 2013/14 Actual FY 2014/15 Budget FYE 2014/15 Forecast FY 2015/16 Budget Revenue (Operating): Water Revenue (Residential)16,596,680$ 17,502,293$ 17,154,552$ 15,909,458$ 11,472,028$ Water Revenue (Commercial & Fire Det.)1,890,269$ 1,984,096$ 2,074,097$ 1,941,531$ 1,385,979$ Water Revenue (Landscape/Irrigation)4,161,528$ 4,543,942$ 4,792,995$ 4,203,144$ 2,782,183$ Service Charges 3,721,462$ 4,341,965$ 4,478,000$ 4,988,739$ 9,426,652$ Other Operating Revenue *684,916$ 936,977$ 670,003$ 1,237,953$ 3,556,678$ Total Operating Revenue27,054,855$ 29,309,273$ 29,169,647$ 28,280,826$ 28,623,519$ Revenue (Non-Operating): Interest121,210$ 131,833$ 100,000$ 130,000$ 85,000$ Property Taxes 1,340,916$ 1,394,722$ 1,283,642$ 1,454,342$ 1,395,000$ Other Non-Operating Revenue 574,424$ 1,255,176$ 521,600$ 702,159$ 595,230$ Total Non-Operating Revenue2,036,550$ 2,781,731$ 1,905,242$ 2,286,500$ 2,075,230$ Total Revenue29,091,405$ 32,091,004$ 31,074,889$ 30,567,326$ 30,698,749$ Expenses (Operating): Variable Water Costs (G.W., Import & Power)13,509,336$ 14,673,144$ 14,928,972$ 13,850,950$ 12,080,410$ Salary Related Expenses6,390,207$ 6,728,455$ 7,628,522$ 7,018,668$ 8,009,599$ Salary Related Expenses - Limited-term Staff -$ -$ -$ -$ 228,753$ Reduction for Capital Project Labor -$ -$ (265,050)$ (165,000)$ (120,000)$ Salary Related Expenses Total 6,390,207$ 6,728,455$ 7,363,472$ 6,853,668$ 8,118,352$ Supplies & Services Communications 186,573$ 199,790$ 273,786$ 181,700$ 280,232$ Contractual Services 442,969$ 528,149$ 521,451$ 465,924$ 545,124$ Data Processing 124,249$ 146,497$ 173,752$ 149,108$ 217,461$ Dues & Memberships 53,262$ 62,930$ 72,321$ 71,216$ 106,773$ Fees & Permits **173,052$ 170,327$ 169,437$ 161,127$ 2,718,822$ Board Election -$ -$ 69,750$ -$ -$ Insurance 242,338$ 249,605$ 291,406$ 244,142$ 275,596$ Materials 734,474$ 634,634$ 579,369$ 630,630$ 690,479$ District Activities, Emp Recognition 20,053$ 14,931$ 22,980$ 12,795$ 27,072$ Maintenance 353,309$ 317,247$ 471,530$ 399,014$ 415,101$ Non-Capital Equipment 164,430$ 120,883$ 132,525$ 107,307$ 138,338$ Office Expense 39,441$ 34,729$ 37,642$ 38,550$ 39,851$ Professional Services 876,546$ 508,378$ 672,197$ 448,372$ 544,350$ Training 19,741$ 28,293$ 58,571$ 42,057$ 67,718$ Travel & Conferences 23,883$ 27,639$ 42,129$ 36,348$ 88,406$ Uncollectible Accounts 32,089$ 26,116$ 37,200$ 33,108$ 37,200$ Utilities 85,903$ 35,103$ 83,700$ 75,030$ 83,700$ Vehicle Expenses 318,240$ 346,351$ 281,139$ 278,077$ 300,328$ Supplies & Services Sub-Total3,890,552$ 3,451,602$ 3,990,886$ 3,374,504$ 6,576,551$ Total Operating Expenses 23,790,095$ 24,853,201$ 26,283,331$ 24,079,123$ 26,775,313$ Expenses (Non-Operating) Interest on Long Term Debt 1,781,416$ 1,715,429$ 1,780,793$ 1,714,192$ 1,655,685$ Other Expense 228,364$ 47,948$ 72,000$ 9,250$ 22,000$ Total Non-Operating Expenses2,009,780$ 1,763,377$ 1,852,793$ 1,723,442$ 1,677,685$ Total Expenses 25,799,875$ 26,616,578$ 28,136,123$ 25,802,565$ 28,452,998$ Net Income (Loss) Before Capital Contributions3,291,530$ 5,474,426$ 2,938,766$ 4,764,760$ 2,245,751$ Extra-Ordinary Item -$ 5,000,000$ -$ -$ -$ Capital Contributions 711,319$ 1,235,502$ -$ 61,035$ -$ Net Income (Loss) Before Depreciation 4,002,849$ 11,709,928$ 2,938,766$ 4,825,795$ 2,245,751$ Depreciation 5,580,026$ 5,982,770$ 5,992,500$ 6,012,184$ 6,003,400$ Income (Loss)(1,577,177)$ 5,727,158$ (3,053,734)$ (1,186,388)$ (3,757,649)$ * Line item includes potential Administrative Penalties assessed to District Customers for excessive water use. YLWD Ordinance No. 15-01. ** Line item includes potential Adminstrative Penalties/Fees that may be assessed on YLWD from SWRCB Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 5 Total Revenue and Expenses (Water), Continued Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 6 Total Revenue and Expenses (Sewer) FY 2012/13 Actual FY 2013/14 Actual FY 2014/15 Budget FYE 2014/15 Forecast FY 2015/16 Budget Revenue (Operating): Sewer Charge Revenue1,561,850$ 1,565,548$ 1,605,292$ 1,588,680$ 1,584,348$ Sewer Parcel Assessments200,189$ 201,054$ 201,000$ 194,895$ 201,500$ Other Operating Revenue 38,661$ 110,648$ 49,774$ 60,440$ 36,291$ Total Operating Revenue1,800,700$ 1,877,250$ 1,856,066$ 1,844,015$ 1,822,139$ Revenue (Non-Operating): Interest16,359$ 13,215$ 12,000$ 14,679$ 8,000$ Other Non-Operating Revenue14,430$ 70,509$ 11,925$ 6,425$ 11,925$ Total Non-Operating Revenue30,789$ 83,724$ 23,925$ 21,104$ 19,925$ Total Revenue 1,831,489$ 1,960,974$ 1,879,991$ 1,865,119$ 1,842,064$ Expenses (Operating): Variable Water Costs (G.W., Import & Power)-$ -$ -$ -$ -$ Salary Related Expenses 835,522$ 801,026$ 881,290$ 979,273$ 860,865$ Reduction for Capital Project Labor -$ -$ (19,950)$ (18,975)$ (15,000)$ Salary Related Expenses Total835,522$ 801,026$ 861,340$ 960,298$ 845,865$ Supplies & Services Communications 12,577$ 14,873$ 21,108$ 13,676$ 21,293$ Contractual Services 33,400$ 38,982$ 39,249$ 35,090$ 41,031$ Data Processing 9,177$ 11,605$ 13,078$ 11,223$ 16,368$ Dues & Memberships 4,140$ 4,601$ 5,744$ 5,516$ 8,337$ Fees & Permits 15,302$ 12,968$ 16,753$ 15,278$ 207,843$ Board Election -$ -$ 5,250$ -$ -$ Insurance 14,936$ 21,512$ 21,934$ 18,376$ 20,744$ Materials 18,064$ 79,991$ 78,756$ 70,247$ 105,472$ District Activities, Emp Recognition 1,370$ 1,087$ 1,730$ 963$ 2,038$ Maintenance 104,354$ 85,807$ 35,491$ 124,996$ 332,244$ Non-Capital Equipment 18,415$ 17,560$ 19,475$ 28,325$ 29,413$ Office Expense 2,902$ 6,736$ 2,833$ 2,902$ 3,000$ Professional Services 30,272$ 24,521$ 39,413$ 30,838$ 100,360$ Training 5,365$ 5,778$ 6,609$ 4,766$ 7,297$ Travel & Conferences 1,578$ 1,814$ 4,371$ 2,736$ 10,074$ Uncollectible Accounts 4,294$ 3,516$ 2,800$ 2,492$ 2,800$ Utilities 6,430$ 3,098$ 7,100$ 6,372$ 7,150$ Vehicle Expenses 49,270$ 63,132$ 77,261$ 78,921$ 72,105$ Supplies & Services Sub-Total331,846$ 397,581$ 398,954$ 452,717$ 987,566$ Total Operating Expenses 1,167,368$ 1,198,607$ 1,260,293$ 1,413,015$ 1,833,432$ Expenses (Non-Operating): Interest Expense -$ -$ -$ -$ -$ Other Expense -$ -$ -$ -$ -$ Total Non-Operating Expenses-$ -$ -$ -$ -$ Total Expenses 1,167,368$ 1,198,607$ 1,260,293$ 1,413,015$ 1,833,432$ Net Income (Loss) Before Capital Contributions664,121$ 762,367$ 619,698$ 452,105$ 8,633$ Transfer (To)/From -$ -$ -$ -$ -$ Capital Contributions 463,354$ 893,077$ -$ 19,177$ -$ Net Income Before Depreciation 1,127,475$ 1,655,444$ 619,698$ 471,282$ 8,633$ Depreciation 1,304,187$ 1,332,314$ 1,345,000$ 1,342,516$ 1,346,600$ Income (Loss)(176,712)$ 323,130$ (725,302)$ (871,234)$ (1,337,967)$ Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 7 Total Revenue and Expenses (Sewer), Continued Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 8 Total Revenues by Fund Total Revenues FY 2012/13 Actual FY 2013/14 Actual FY 2014/15 Budget FY 2014/15 Forecast FY 2015/16 Budget Water Revenue 29,091,405$ 32,091,004$ 31,074,889$ 30,567,326$ 30,698,749$ Sewer Revenue 1,831,489$ 1,960,974$ 1,879,991$ 1,865,119$ 1,842,064$ Total Operating Revenue:30,922,894$ 34,051,978$ 32,954,880$ 32,432,445$ 32,540,813$ Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 9 Total Expenses by Fund FY 2012/13 Actual FY 2013/14 Actual FY 2014/15 Budget FY 2014/15 Forecast FY 2015/16 Budget Water$25,799,875$26,616,578$28,136,123$25,802,565$28,452,998 Sewer$1,167,368$1,198,607$1,260,293$1,413,015$1,833,432 Total Operating Expenses:$26,967,243$27,815,185$29,396,417$27,215,580$30,286,430 Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 10 Total Expenses by Category Five Year Cost Comparison Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 11 Variable Water Cost Expenses Note: The Variable Water Costs category is the largest component of the FY 2015/16 Budgeted Operating Costs and includes imported and groundwater purchases, as well as power costs associated with pumping water throughout the District. These costs are listed in the Total Water Revenues and Expenses and Water Revenues and Expenses schedules on pages 56 and 58, respectively. Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 12 Reserves & Funding Sources Restriction Category Balance Ending 6/30/2014 Balance Ending 5/31/2015 Forecast Balance Ending 6/30/2015 Additions (Deductions) FYE 2015/16 Budgeted Balalnces Ending 6/30/2016 Water (Operating): Operating FundOperating Reserve3,136,962 4,105,782 4,395,782 (4,395,782) - Reserve for Debt ServiceDebt Service Payment2,730,024 3,500,427 3,500,472 (776,963) 2,723,509 Employee LiabilitiesOPEB and Comp Abs.186,070 186,301 186,306 92,694 279,000 Water (Capital) Water EmergencyEmergency Reserve1,010,940 1,026,157 1,026,207 (26,207) 1,000,000 Water Capital ProjectsCapital Reserve16,676,503 17,373,484 17,393,484 5,106,258 22,499,742 COP Bond 2008 - ReserveRestricted from Use*2,152,324 2,180,272 2,152,320 - 2,152,320 Water MaintenanceCapital Reserve 200,000 150,613 200,000 - 200,000 Sewer (Operating): Operating FundOperating Reserve160,489 396,611 434,611 (159,597) 275,015 Employee LiabilitiesOPEB and Comp Abs.14,006 14,023 14,018 6,982 21,000 Sewer (Capital) Sewer EmergencyEmergency Reserve1,010,396 1,018,571 1,018,596 (18,596) 1,000,000 Sewer Capital ProjectsCapital Reserve2,127,063 2,236,864 2,236,904 179,843 2,416,747 Total of Funds 29,404,777$ 32,189,105$ 32,558,700$ 8,633$ 32,567,333$ *Amount has been set aside by the fiscal agent in a reserve fund, and is unable to be spent down Funding Sources Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 13 Projected Reserves & Funding Levels Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 14 Five Year Financial Projections (FY 2016-2020) Narrative This financial projection is designed to provide a general understanding of how revenues and expenditures are expected to influence the District over the next five years. Revenue and expenditure projections are reviewed in relation to their effect on funding capital projects, reserve levels, and operating fund balances. The District will update its projections on an annual basis in order to plan for the future and determine recommended rates. The projection factors in debt ratios, reserve balances, projected rate increases, cost increases and growth projections. The assumptions in the following projections include:  Costs passed-through for all variable water cost rate increases  Annexation to OCWD in FY 14/15  $7 million borrowing through a Line of Credit in FY 12/13 at an interest rate of One Month LIBOR + 0.90%, with renewals every 3 years  Principal repayment due September 16, 2016  A 0.04% annual growth in customer accounts  No change to the sewer rate, but an alignment to address a disparity in our rates in FY 2015/16  Average interest earnings at 0.3 % - 1.2%  1% growth in property taxes  1.5% annual increase in other non-operating revenue other than annexation amortization  9% annual increases in variable water costs  8% annual increases in salary related expenses  3-8% annual increases in supplies and services expenses with the following exceptions:  Board Election expense only budgeted every other year  Interest expense equal to those scheduled by the existing bonds and assumed interest rate of 1.5-2.0% for Line of Credit  No change to future budgets for other non-operating expenses  Depreciation increases based on the projected completion of CIP jobs The District is still in the middle of an aggressive CIP spending plan that was created with the issuance of the 2008 Certificates of Participation. The following projections include the completion of that spending plan. Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 15 Five Year Financial Projections Water & Sewer FY 2015/16 Budget FY 2016/17 Budget FY 2017/18 Budget FY 2018/19 Budget FY 2019/20 Budget Revenue (Operating): Water Revenue (Residential)11,472,028$ 11,816,189$ 12,288,836$ 13,026,167$ 13,807,737$ Water Revenue (Commercial & Fire Det.)1,385,979$ 1,427,558$ 1,484,660$ 1,573,740$ 1,668,164$ Water Revenue (Landscape/Irrigation)2,782,183$ 2,865,648$ 2,980,274$ 3,159,090$ 3,348,636$ Service Charges9,426,652$ 9,945,118$ 10,591,550$ 11,280,001$ 12,013,201$ Sewer Charge Revenue1,584,348$ 1,631,879$ 1,680,835$ 1,731,260$ 1,783,198$ Sewer Parcel Assessments201,500$ 201,500$ 201,500$ 201,500$ 201,500$ Other Operating Revenue3,592,969$ 809,763$ 831,383$ 877,752$ 935,385$ Total Operating Revenue 30,445,658$ 28,697,654$ 30,059,040$ 31,849,510$ 33,757,821$ Revenue (Non-Operating): Interest 93,000$ 96,570$ 112,151$ 136,774$ 148,400$ Property Tax 1,395,000$ 1,408,950$ 1,423,040$ 1,437,270$ 1,451,643$ Other Non-Operating Revenue 607,155$ 624,728$ 658,410$ 725,774$ 784,718$ Total Non-Operating Revenue2,095,155$ 2,130,248$ 2,193,601$ 2,299,819$ 2,384,761$ Total Revenue 32,540,813$ 30,827,902$ 32,252,641$ 34,149,329$ 36,142,581$ Expenses (Operating): Variable Water Costs 12,080,410$ 13,167,647$ 14,352,735$ 15,644,481$ 17,052,485$ Salary Related Expenses 8,964,218$ 9,434,302$ 9,906,017$ 10,401,318$ 10,921,384$ Supplies & Services: Communications 301,525$ 316,601$ 326,099$ 332,852$ 339,746$ Contractual Services 586,155$ 615,463$ 633,927$ 647,049$ 666,460$ Data Processing 233,829$ 245,520$ 257,796$ 270,325$ 283,470$ Dues & Memberships 115,110$ 92,162$ 94,093$ 96,065$ 98,079$ Fees & Permits 2,926,665$ 237,998$ 245,138$ 252,391$ 259,858$ Board Election -$ 50,000$ -$ 75,000$ -$ Insurance 296,340$ 311,157$ 326,715$ 343,051$ 360,203$ Materials 795,950$ 804,248$ 751,125$ 766,964$ 789,973$ District Activities, Emp Recognition 29,110$ 30,566$ 31,198$ 31,844$ 32,800$ Maintenance 747,345$ 705,962$ 624,141$ 642,865$ 662,151$ Non-Capital Equipment 167,750$ 165,638$ 138,659$ 141,750$ 144,913$ Office Expense 42,850$ 44,993$ 46,342$ 47,733$ 49,165$ Professional Services 644,710$ 514,196$ 478,121$ 492,465$ 502,239$ Training 75,015$ 76,734$ 78,346$ 79,991$ 81,672$ Travel & Conferences 98,480$ 75,252$ 72,359$ 73,916$ 75,506$ Uncollectible Accounts 40,000$ 25,025$ 20,703$ 18,356$ 17,589$ Utilities 90,850$ 95,393$ 98,254$ 101,202$ 104,238$ Vehicle Equipment 372,433$ 391,055$ 402,786$ 414,870$ 427,316$ Supplies & Services Sub-Total7,564,117$ 4,797,961$ 4,625,804$ 4,828,688$ 4,895,377$ Total Operating Expenses28,608,745$ 27,399,910$ 28,884,556$ 30,874,487$ 32,869,246$ Expenses (Non-Operating): Interest Expense1,655,685$ 1,726,884$ 1,684,309$ 1,638,509$ 1,638,509$ Other Expense22,000$ 22,000$ 22,000$ 22,000$ 22,000$ Total Non-Operating Expenses 1,677,685$ 1,748,884$ 1,706,309$ 1,660,509$ 1,660,509$ Total Expenses 30,286,430$ 29,148,794$ 30,590,865$ 32,534,996$ 34,529,755$ Net Income (Loss) Before Depreciation2,254,384$ 1,679,108$ 1,661,775$ 1,614,333$ 1,612,827$ Depreciation7,350,000$ 7,591,895$ 7,762,366$ 7,864,058$ 7,986,891$ Income (Loss)(5,095,616)$ (5,912,787)$ (6,100,591)$ (6,249,725)$ (6,374,064)$ Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 16 Five Year Financial Projections Water FY 2015/16 Budget FY 2016/17 Budget FY 2017/18 Budget FY 2018/19 Budget FY 2019/20 Budget Revenue (Operating): Water Revenue (Residential)11,472,028$ 11,816,189$ 12,288,836$ 13,026,167$ 13,807,737$ Water Revenue (Commercial & Fire Det.)1,385,979$ 1,427,558$ 1,484,660$ 1,573,740$ 1,668,164$ Water Revenue (Landscape/Irrigation)2,782,183$ 2,865,648$ 2,980,274$ 3,159,090$ 3,348,636$ Service Charges 9,426,652$ 9,945,118$ 10,591,550$ 11,280,001$ 12,013,201$ Other Operating Revenue 3,556,678$ 768,028$ 783,389$ 822,558$ 871,912$ Total Operating Revenue 28,623,519$ 26,822,542$ 28,128,710$ 29,861,556$ 31,709,649$ Revenue (Non-Operating): Interest 85,000$ 88,250$ 102,500$ 125,000$ 135,625$ Property Tax 1,395,000$ 1,408,950$ 1,423,040$ 1,437,270$ 1,451,643$ Other Non-Operating Revenue 595,230$ 611,015$ 641,268$ 701,775$ 754,719$ Total Non-Operating Revenue2,075,230$ 2,108,215$ 2,166,808$ 2,264,045$ 2,341,987$ Total Revenue 30,698,749$ 28,930,756$ 30,295,517$ 32,125,601$ 34,051,636$ Expenses (Operating): Variable Water Costs 12,080,410$ 13,167,647$ 14,352,735$ 15,644,481$ 17,052,485$ Salary Related Expenses 8,118,352$ 8,520,767$ 8,946,806$ 9,394,146$ 9,863,853$ Supplies & Services: Communications 280,232$ 294,244$ 303,071$ 309,133$ 315,315$ Contractual Services 545,124$ 572,380$ 589,552$ 601,343$ 619,383$ Data Processing 217,461$ 228,334$ 239,751$ 251,738$ 264,325$ Dues & Memberships 106,773$ 83,409$ 85,077$ 86,778$ 88,514$ Fees & Permits 2,718,822$ 19,764$ 20,356$ 20,865$ 21,387$ Board Election -$ 46,500$ -$ 69,750$ -$ Insurance 275,596$ 289,376$ 303,845$ 319,037$ 334,989$ Materials 690,479$ 725,002$ 669,502$ 682,893$ 703,379$ District Activities, Emp Recognition 27,072$ 28,426$ 28,994$ 29,574$ 30,462$ Maintenance 415,101$ 435,856$ 345,932$ 356,310$ 366,999$ Non-Capital Equipment 138,338$ 134,754$ 106,849$ 108,986$ 111,166$ Office Expense 39,851$ 41,843$ 43,098$ 44,391$ 45,723$ Professional Services 544,350$ 440,318$ 402,027$ 414,088$ 421,511$ Training 67,718$ 69,072$ 70,454$ 71,863$ 73,300$ Travel & Conferences 88,406$ 64,674$ 61,464$ 62,693$ 63,947$ Uncollectible Accounts 37,200$ 22,085$ 17,675$ 15,237$ 14,376$ Utilities 83,700$ 87,885$ 90,522$ 93,237$ 96,034$ Vehicle Equipment 300,328$ 315,344$ 324,804$ 334,549$ 344,585$ Supplies & Services Sub-Total6,576,551$ 3,899,266$ 3,702,974$ 3,872,466$ 3,915,396$ Total Operating Expenses 26,775,313$ 25,587,680$ 27,002,515$ 28,911,093$ 30,831,734$ Expenses (Non-Operating): Interest Expense 1,655,685$ 1,726,884$ 1,684,309$ 1,638,509$ 1,638,509$ Other Expense 22,000$ 22,000$ 22,000$ 22,000$ 22,000$ Total Non-Operating Expenses 1,677,685$ 1,748,884$ 1,706,309$ 1,660,509$ 1,660,509$ Total Expenses 28,452,998$ 27,336,564$ 28,708,824$ 30,571,602$ 32,492,243$ Net Income (Loss) Before Depreciation2,245,751$ 1,594,192$ 1,586,693$ 1,553,999$ 1,559,394$ Depreciation6,003,400$ 6,240,295$ 6,407,891$ 6,507,247$ 6,629,580$ Income (Loss)(3,757,649)$ (4,646,103)$ (4,821,198)$ (4,953,248)$ (5,070,186)$ Debt Service Coverage 1.25 1.22 1.15 1.12 1.15 Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 17 Five Year Financial Projections Sewer FY 2015/16 Budget FY 2016/17 Budget FY 2017/18 Budget FY 2018/19 Budget FY 2019/20 Budget Revenue (Operating): Sewer Charge Revenue1,584,348$ 1,631,879$ 1,680,835$ 1,731,260$ 1,783,198$ Sewer Parcel Assessments 201,500$ 201,500$ 201,500$ 201,500$ 201,500$ Other Operating Revenue 36,291$ 41,735$ 47,995$ 55,194$ 63,473$ Total Operating Revenue 1,822,139$ 1,875,113$ 1,930,330$ 1,987,954$ 2,048,171$ Revenue (Non-Operating): Interest 8,000$ 8,320$ 9,651$ 11,774$ 12,775$ Other Non-Operating Revenue 11,925$ 13,714$ 17,142$ 23,999$ 29,999$ Total Non-Operating Revenue19,925$ 22,034$ 26,793$ 35,774$ 42,774$ Total Revenue 1,842,064$ 1,897,147$ 1,957,123$ 2,023,728$ 2,090,945$ Expenses (Operating): Salary Related Expenses 845,865$ 913,535$ 959,211$ 1,007,172$ 1,057,531$ Supplies & Services: Communications 21,293$ 22,357$ 23,028$ 23,719$ 24,431$ Contractual Services 41,031$ 43,082$ 44,375$ 45,706$ 47,077$ Data Processing 16,368$ 17,186$ 18,046$ 18,587$ 19,145$ Dues & Memberships 8,337$ 8,754$ 9,016$ 9,287$ 9,565$ Fees & Permits 207,843$ 218,235$ 224,782$ 231,525$ 238,471$ Board Election -$ 3,500$ -$ 5,250$ -$ Insurance 20,744$ 21,781$ 22,870$ 24,014$ 25,214$ Materials 105,472$ 79,245$ 81,622$ 84,071$ 86,593$ District Activities, Emp Recognition 2,038$ 2,140$ 2,204$ 2,270$ 2,338$ Maintenance 332,244$ 270,106$ 278,210$ 286,556$ 295,153$ Non-Capital Equipment 29,413$ 30,883$ 31,810$ 32,764$ 33,747$ Office Expense 3,000$ 3,149$ 3,244$ 3,341$ 3,442$ Professional Services 100,360$ 73,878$ 76,094$ 78,377$ 80,728$ Training 7,297$ 7,662$ 7,892$ 8,129$ 8,372$ Travel & Conferences 10,074$ 10,578$ 10,895$ 11,222$ 11,559$ Uncollectible Accounts 2,800$ 2,940$ 3,028$ 3,119$ 3,213$ Utilities 7,150$ 7,508$ 7,733$ 7,965$ 8,204$ Vehicle Equipment 72,105$ 75,711$ 77,982$ 80,321$ 82,731$ Supplies & Services Sub-Total987,566$ 898,695$ 922,830$ 956,222$ 979,982$ Total Operating Expenses1,833,432$ 1,812,229$ 1,882,041$ 1,963,394$ 2,037,512$ Expenses (Non-Operating): Other Expense-$ -$ -$ -$ -$ Total Non-Operating Expenses -$ -$ -$ -$ -$ Total Expenses 1,833,432$ 1,812,229$ 1,882,041$ 1,963,394$ 2,037,512$ Net Income (Loss) Before Depreciation 8,633$ 84,918$ 75,082$ 60,334$ 53,433$ Depreciation 1,346,600$ 1,351,600$ 1,354,475$ 1,356,811$ 1,357,311$ Income (Loss)(1,337,967)$ (1,266,682)$ (1,279,393)$ (1,296,477)$ (1,303,878)$ Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 18 Five Year Financial Projections Reserve Balances- Water FY 2015/16 Budget FY 2016/17 Budget FY 2017/18 Budget FY 2018/19 Budget FY 2019/20 Budget Operating Reserves Ending Balance 4,270,217$ 4,102,797$ 4,308,705$ 4,588,170$ 4,876,314$ Minimum Balance 2,143,234$ 2,048,248$ 2,161,471$ 2,314,183$ 2,467,860$ Maximum Balance 4,839,579$ 4,649,836$ 4,883,199$ 5,199,925$ 5,526,489$ Capital Replacement Reserves Ending Balance 15,998,887$ 8,998,887$ 1,820,000$ 1,820,000$ 1,820,000$ Minimum Balance*1,820,000$ 1,820,000$ 1,820,000$ 1,820,000$ 1,820,000$ Maintenance Reserves Ending Balance 200,000$ 200,000$ 200,000$ 200,000$ 200,000$ Minimum Balance 200,000$ 200,000$ 200,000$ 200,000$ 200,000$ Emergency Reserves Ending Balance 1,000,000$ 1,000,000$ 1,000,000$ 1,000,000$ 1,000,000$ Minimum Balance 1,000,000$ 1,000,000$ 1,000,000$ 1,000,000$ 1,000,000$ Debt Service Reserves Ending Balance 2,723,509$ 2,723,509$ 2,723,509$ 2,723,509$ 2,723,509$ Minimum Balance 2,723,509$ 2,723,509$ 2,723,509$ 2,723,509$ 2,723,509$ COP Reserves Ending Balance 2,152,320$ 2,147,096$ 2,147,096$ 2,147,096$ 2,147,096$ Minimum Balance 2,147,096$ 2,147,096$ 2,147,096$ 2,147,096$ 2,147,096$ Employee Benefit Liability Reserves Ending Balance 279,000$ 372,000$ 465,000$ 558,000$ 651,000$ Minimum Balance*93,000$ 93,000$ 93,000$ 93,000$ 93,000$ Total Water Reserves ##########7,934,644$ 6,509,979$ (742,464)$ (751,145)$ Ending Balance26,623,932$ 19,544,289$ 12,664,310$ 13,036,775$ 13,417,919$ Minimum Balance10,126,839$ 10,031,853$ 10,145,076$ 10,297,788$ 10,451,465$ Maximum Balance *Minimum Balance is actually minimum annual funding Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 19 Five Year Financial Projections Reserve Balances- Sewer FY 2015/16 Budget FY 2016/17 Budget FY 2017/18 Budget FY 2018/19 Budget FY 2019/19 Budget Operation Reserves Ending Balance 275,015$ 271,834$ 282,306$ 294,509$ 305,627$ Minimum Balance 146,675$ 144,978$ 150,563$ 157,072$ 163,001$ Maximum Balance 311,683$ 308,079$ 319,947$ 333,777$ 346,377$ Capital Replacement Reserves Ending Balance 2,023,439$ 1,622,939$ 1,622,939$ 1,622,939$ 1,622,939$ Minimum Balance*345,000$ 345,000$ 345,000$ 345,000$ 345,000$ Emergency Reserves Ending Balance 1,000,000$ 1,000,000$ 1,000,000$ 1,000,000$ 1,000,000$ Minimum Balance 250,000$ 250,000$ 250,000$ 250,000$ 250,000$ Employee Liability Reserves Ending Balance 21,000$ 28,000$ 35,000$ 42,000$ 49,000$ Minimum Balance 14,000$ 14,000$ 14,000$ 14,000$ 14,000$ Total Sewer Reserves (725,795)$ 363,891$ (110,345)$ (112,076)$ (110,991)$ Ending Balance 3,319,454$ 2,922,773$ 2,940,245$ 2,959,448$ 2,977,566$ Minimum Balance 755,675$ 753,978$ 759,563$ 766,072$ 772,001$ *Minimum Balance is actually minimum annual funding Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 20 Fund Balance History (FYE 2012-2016) Ending FundsFundTotal 06/30/12Net Income Before Capital Contributions (1,119,927)(287,672)(1,407,599) Capital Contributions 98,24117,115,89817,214,139 Transfers In (Out)(85,111)85,111 0 Extraordinary Item (5,000,000)- (5,000,000) Fund Balance @ 6/30/2012 122,238,503$ 42,803,710$ 165,042,213$ 06/30/13Net Income Before Capital Contributions (2,288,495)(640,066)(2,928,561) Capital Contributions 711,319463,3541,174,673 Prior Period Adjustment (1,561,743)- (1,561,743) Fund Balance @ 6/30/2013 119,099,584$ 42,626,998$ 161,726,582$ 06/30/14Net Income(Loss) Before Capital Contributions (508,344)(569,947)(1,078,291) Capital Contributions 1,235,502893,0772,128,579 Extraordinary Item 5,000,000 - 5,000,000 Net Income(Loss) FY 2014 5,727,158323,1306,050,288 Fund Balance @ 6/30/2014 124,826,742$ 42,950,128$ 167,776,870$ 06/30/15Revenue (Operating): Water Sales 27,042,873 - 27,042,873 Sewer Revenues - 1,783,5751,783,575 Other Operating Revenue 1,237,95360,4401,298,393 Interest 130,00014,679144,679 Property Taxes 1,454,342 - 1,454,342 Other Non-Operating Revenue 702,1596,425708,584 Total Estimated Revenues FY2015 30,567,3261,865,11932,432,445 Expenses (Operating): Variable Water Costs (G.W., Import & Power)13,850,950 - 13,850,950 Salary Related Expenses 6,853,668 960,298 7,813,967 Supplies & Services 3,374,504 452,717 3,827,221 Depreciation 6,012,184 1,342,516 7,354,700 Interest on Long Term Debt 1,714,192 - 1,714,192 Other Expense 9,250 - 9,250 Total Estimated Expenses FY2015 31,814,749 2,755,531 34,570,280 Net Income(Loss) Before Capital Contributions (1,247,423)(890,411)(2,137,834) Capital Contributions 61,03519,17780,212 Net Income (Loss) FY 2015 (1,186,388)(871,234)(2,057,622) Estimated Fund Balance @ 6/30/2015 123,640,353$ 42,078,894$ 165,719,247$ 06/30/16Revenue (Operating): Water Sales 25,066,841 - 25,066,841 Sewer Revenues - 1,785,8481,785,848 Other Operating Revenue 3,556,67836,2913,592,969 Interest 85,0008,00093,000 Property Taxes 1,395,000 - 1,395,000 Other Non-Operating Revenue 595,23011,925607,155 Total Estimated Revenues FY2016 30,698,7491,842,06432,540,813 Expenses (Operating): Variable Water Costs (G.W., Import & Power)12,080,410 - 12,080,410 Salary Related Expenses 8,118,352 845,865 8,964,218 Supplies & Services 6,576,551 987,566 7,564,117 Depreciation 6,003,400 1,346,600 7,350,000 Interest on Long Term Debt 1,655,685 - 1,655,685 Other Expense 22,000 - 22,000 Total Estimated Expenses FY2016 34,456,398 3,180,032 37,636,430 Net Income(Loss) FY 2016 (3,757,649)(1,337,967)(5,095,616) Estimated Fund Balance @ 6/30/2016 119,882,704$ 40,740,926$ 160,623,631$ Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 21 Debt Administration The District’s debt rating from Fitch is “AA”. The District has no formal debt policy and no legal debt limit; however, the District’s future borrowing capacity is limited by the debt coverage ratio required by existing bond covenants. The ratio is calculated using revenue and expenses data pertaining to the Water Fund only and the covenants require that the coverage exceed 1.1. The District’s budgeted ratio is 1.25 for Fiscal Year 2016. This District’s Fiscal Year 2015/16 budgeted debt service obligation ($2,721,559) is related to its two existing debt issuances. Use of proceeds and the corresponding principal balance of each are as follows: Debt service requirements for the District’s Certificates of Participation are as follows: Year of Issuance Use of ProceedsPrincipal Balance as of June 2015 2008 COPCOP funds are being issued to finance certain capital improvements, to fund a reserve fund, and to pay certain costs of delivery. $ 30,630,000 2012A Refunding Bond Refunding Bonds funds are being issued to finance certain capital improvements, to fund a reserve fund, and to pay certain costs of delivery. 7,795,000 38,425,000$ Debt service requirements for the District's Certificate of Participation and Revenue Bond are as follows: Year Principal Interest Total 2016 1,045,000$ 1,676,559$ 2,721,559$ 2017 1,080,000$ 1,636,884$ 2,716,884$ 2018 1,120,000$ 1,594,309$ 2,674,309$ 2019 1,170,000$ 1,548,509$ 2,668,509$ 2020 1,210,000$ 1,500,909$ 2,670,909$ 2021-2025 6,850,000$ 6,701,525$ 13,551,525$ 2026-2029 8,470,000$ 5,032,963$ 13,502,963$ 2030-2034 9,875,000$ 3,004,944$ 12,879,944$ 2035-2039 7,605,000$ 783,375$ 8,388,375$ Total 38,425,000$ 23,479,976$ 61,774,976$ Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 22 Debt Administration, Continued Employees Per Capita * Note: Employees per Capita is for fiscal year 2014/15 and is measured in number of employees per thousand customers. YLWD provides sewer service in addition to water service. Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 23 Residential Meter Charge Comparison Note: Approximately 93% of the District’s customer base has a 1 inch or smaller meter. The charges for all agencies are current as of FY 14/15. Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 24 CAPITAL PROJECTS Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 25 2012 Pipeline Project Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 26 Capital Improvement Plan Project Description Total Project Budget 2014/15 CY Additions to CIP as Approved by Board Action Total Project Budget 2015/16 Total CIP Expenditures Thru FYE June 2014 Total Projected CIP Expenses in FY 2014/15 S & W Well Project (Well No. 21)2,306,789$ ‐$ 2,306,789$ 1,016,608$ 95,578$ S & W Well Project (Well No. 22)2,500,000$ ‐$ 2,500,000$ 4,869$ 36,451$ Fairmont BPS Upgrade6,300,000$ ‐$ 6,300,000$ 574,803$ 122,898$ Lakeview Grade Separation600,000$ 62,444 662,444$ 287,955$ 114,490$ Richfield Road Pipeline ‐$ 1,450,000$ 1,450,000$ ‐$ 75,414$ Subtotal 11,706,789$ 1,512,444$ 13,219,233$ 1,884,235$ 444,830$ Rehabilitation & Restoration Future Pipeline Project2,690,000$ (1,450,000) 1,240,000$ ‐$ 21,872$ Timber Ridge BPS Rehabilitation250,000$ ‐ 250,000$ ‐$ Lakeview Booster Piping100,000$ ‐ 100,000$ 6,000$ PRS Rehabilitation Phase 2 1,430,000$ ‐ 1,430,000$ ‐$ 31,690$ Annual Routine Capital R&R 4,020,000$ (351,410)$ 3,668,590$ ‐$ ‐$ R & R Subtotal 8,490,000$ (1,801,410)$ 6,688,590$ ‐$ 59,562$ Vehicle & Capital Equipment Replacement 472,000$ 472,000$ 72,000$ Vehicle & Capital Equipment Replacement449,000$ 449,000$ 399,000$ Vehicle & Capital Equipment Subtotal 921,000$ ‐$ 921,000$ ‐$ 471,000$ Repayment of LOC Principal to Wells Fargo Bank Subtotal21,117,789$ (288,966)$ 20,828,823$ 1,884,235$ 975,392$ Projects Completed in FY 2014/15 Total Project Budget 2014/15 Over/(Under) Budget Adjusted Total CIP Budget FY 2015/16 Total CIP Expenditures Thru FYE June 2014 Total Projected CIP Expenses in FY 2014/15 YL Blvd BPS (Booster Pump Station)1,897,991$ 165,078 2,063,069$ 1,937,784$ 125,285$ Deville Drive Water Line Extention 50,000$ 12,635 62,635$ 10,772$ 51,863$ Orangeview Waterline Extension ‐$ 80,120 80,120$ ‐$ 80,120$ Yorba Linda High School Park 370,000$ 131,191 501,191$ 55,106$ 446,084$ Richfield Campus Spoils 150,000$ 150,000$ ‐$ 145,020$ 2,467,991$ 389,024$ 2,857,015$ 2,003,662$ 848,372$ Grand Total23,585,780$ 100,058$ 23,685,838$ 3,887,897$ 1,823,764$ Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 27 Capital Improvement Plan, Continued FY 15/16 Budgeted CIP Expenditures FY 16/17 Budgeted CIP Expenditures FY 17/18 Budgeted CIP Expenditures FY 18/19 Budgeted CIP Expenditures FY 19/20 Budgeted CIP Expenditures 5 Year Future Projected Budgets 1,194,603$ ‐$ ‐$ ‐$ ‐$ 1,194,603$ 211,320$ 950,000$ 1,040,000$ 257,360$ ‐$ 2,458,680$ 1,000,000$ 4,000,000$ 602,299$ ‐$ ‐$ 5,602,299$ 260000 260,000$ 1,340,000$ 34,586$ ‐$ ‐$ ‐$ 1,374,586$ 4,005,923$ 4,984,586$ 1,642,299$ 257,360$ ‐$ 10,890,168$ 760,000$ 458,128$ ‐$ ‐$ ‐$ 1,218,128$ 240,000$ 10,000$ ‐$ ‐$ ‐$ 250,000$ 94,000$ ‐$ ‐$ ‐$ ‐$ 94,000$ 153,310$ 528,000$ 90,000$ 627,000$ ‐$ 1,398,310$ ‐$ ‐$ 1,520,000$ 2,148,590$ ‐$ 3,668,590$ 1,247,310$ 996,128$ 1,610,000$ 2,775,590$ ‐$ 6,629,028$ 680,000$ 200,000$ 200,000$ 200,000$ 200,000$ 1,480,000$ $392,000$612,000$165,000$177,000$180,000 1,526,000$ 1,072,000$ 812,000$ 365,000$ 377,000$ 380,000$ 3,006,000$ 7,000,000$ 6,325,233$ 13,792,714$ 3,617,299$ 3,409,950$ 380,000$ 20,525,196$ 6,325,233$ 13,792,714$ 3,617,299$ 3,409,950$ 380,000$ 20,525,196$ Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 28 Vehicle Equipment and Capital Outlay (FY 2015/16) Department / Item Amount Board of Directors None Administration None Engineering None Finance None Human Resources None IT Information Systems SQL System Upgrades (Operating System and Software)10,000$ Firewall Replacement 6,000$ Data Center Humidifier/Dehumidifier 24,000$ File Storage 19,000$ Server Replacement 5,000$ Total Vehicle Equipment & Capital Outlay- IT 64,000$ Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 29 Vehicle Equipment and Capital Outlay (FY 2015/16), Continued Department / Item Amount Operations Adminstration Vehicle Wash Machine 12,000$ Water Operations & Maint. (2) Pickup Trucks 73,000$ Sewer Operations & Maint. Vactor Truck 400,000$ 13 Sewer Re-line (Manhole to Manhole)250,000$ Portable Generator for Lift Station (small)30,000$ Water Production Electric Generator (small)30,000$ SCADA Box Canyon PLC (Control System) Upgrade 16,000$ Well-10 PLC (Control System) Upgrade 14,000$ Well-15 PLC (Control System) Upgrade 14,000$ Well-19 PLC (Control System) Upgrade 10,000$ Main Router Replacement 42,000$ Momentum Unity CPU Upgrade 6,000$ Highland Reservoir Emergency System Replacement 75,000$ Lakeview Reservoir Emergency System Replacement 36,000$ Total Vehicle Equipment & Capital Outlay- Operations 1,008,000$ TOTAL VEHICLE EQUIPMENT & CAPITAL OUTLAY 1,072,000$ Reconciliation by Fund Water Fund 392,000$ Sewer Fund 680,000$ TOTAL 1,072,000$ Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 30 Department Summaries Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 31 Board of Directors Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 32 Board of Directors Budget FY 2014/15 BudgetFY 2015/16 Budget Expenses (Operating) Salary Related Expenses Salaries - Directors90,000$ 90,000$ Fringe Benefits52,442$ 59,385$ Mandatory Benefits - Directors8,533$ 7,991$ Total Salary Related Expenses150,975$ 157,376$ Supplies & Services Communications-$ -$ Contractual Services1,500$ 1,500$ Dues & Memberships13,400$ 13,500$ Board Election Expenses75,000$ -$ District Meetings and Events-$ 1,500$ Professional Services90,000$ 90,000$ Professional Development4,100$ 14,000$ Travel & Conferences9,400$ 16,600$ Supplies & Services Sub-Total193,400$ 137,100$ Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 33 Board of Directors Supplies & Services Budget (FY 2015/16) Category Total Sub Acct Total Detail Amt $1,500 1,500 1,500 200 6,000 100 4,500 2,500 200 $1,500 1,500 1,500 30,000 60,000 $14,000 14,000 14,000 1,500 2,000 3,000 150 2,000 2,400 1,200 4,000 350 350 $137,100 Primary GL Category Sub Acct No./Sub Category Detail Item Description 1-1010-0600-00 Contractual Services 1-1010-0600-00 CONTRACTUAL SERVICES Tablet PC Data Service ($25 x 5) 1-1010-0640-00 Dues, Memberships, Subscriptions $13,500 1-1010-0640-00 Dues, Memberships, Subscriptions 13,500WACO CSDA Colorado River Water Users Assoc CASA Water Ed Foundation ISDOC 1-1010-0715-00 District Meetings and 1-1010-0715-55 Adminstration Meeting General Meeting Expenses 1-1010-0780-00 Professional Services $90,000 1-1010-0780-00 Professional Services 90,000Legal Services - Retainer Legislative Consultants 1-1010-0810-00 Professional 1-1010-0810-00 Professional Development Board Workshops (4) 1-1010-0830-00 Travel & Conferences $16,600 1-1010-0830-00 Travel & Conferences 16,250Other Conferences CRWUA (2 attendees at $1,000 each) CSDA (2 attendees at $1,500 each) Section Total ISDOC Quarterly Urban Water Institute (1 attendee) Fall/Spring CASA Conference (Annual- $1,200, Winter-$1,200) MWDOC Water Policy Dinners ACWA (Spring- 2 @ $1,000, Fall- 2 @ $1,000) 1-1010-0830-50 Meeting Mileage Mileage Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 34 Administration Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 35 Administration Department Budget (FY 2015/16) FY 2014/15 Budget FY 2015/16 Budget Expenses (Administration) Salary Related Expenses Salaries 553,406$ 798,250$ Fringe Benefits 101,580$ 138,373$ Retiree Benefits 149,519$ 150,590$ Unemployment Insurance 10,400$ 10,400$ OPEB & CalPERS Contributions 187,756$ 405,861$ Mandatory Benefits 62,824$ 77,246$ Total Salary Related Expenses 1,065,485$ 1,580,720$ Supplies & Services Communications 189,994$ 192,500$ Contractual Services 7,400$ 5,000$ Dues & Memberships 52,960$ 52,985$ Fees & Permits -$ 2,700,250$ Insurance 1,240$ 740$ District Activities & Events 4,650$ 10,500$ Materials -$ 2,000$ Non-Capital Equipment -$ 11,000$ Office Expense 250$ 4,340$ Professional Services 405,750$ 169,250$ Professional Development 3,350$ 3,780$ Travel & Conferences 9,500$ 23,675$ Supplies & Services Sub-Total 675,094$ 3,176,020$ Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 36 Administration Budget Division Detail (FY 2015/16) Administration Division Category Total Sub Acct Total Detail Amt 250 2,700,000 24,000 775 5,700 500 60 19,000 50 40 700 1,200 1,500 1,200 2,000 2,500 1,5001,500 5,0005,000 2,000 2,000 2,000 250 400 250 1,7501,750 50,000 25,000 87,00087,000 500 5,000 1,500 250 280 1,000 2,000 750 4,300 3,000 240 2,000 360 75 2,0002,000 $2,959,880 OCWA Meetings ISDOC Quarterly 1-2010-0830-50 Meeting Mileage Mileage Section Total 1-2010-0830-00 Travel & Conferences $14,725 1-2010-0830-00 Travel & Conferences 12,725ACWA (1 attendee) - Spring/Fall Laserfische Conference (1 attendee) AWWA (Annual- $2,500, Section- $1,750) Other Conferences MWDOC Water Policy Dinners CSDA Leadership Summit Records Destruction Codification Shred-It Records Retention Schedule Update 1-2010-0810-00 Professional Development $1,280 1-2010-0810-00 Professional Development 1,280Notary Training & Exam Misc GM Training 1-2010-0780-00 Professional Services $169,250 1-2010-0780-00 Professional Services 75,000Laserfische Upgrade District Plan Updates 1-2010-0780-05 Legal Services Routine Legal 1-2010-0780-15 Records Management 7,250 1-2010-0760-00 Office Expense $2,650 1-2010-0760-00 Office Expense 900Office Supplies Bereavement Flowers Hands Free Typing 1-2010-0760-21 Printer Supplies Printer Ink 1-2010-0715-00 District Meetings and Events $9,900 1-2010-0715-50 General Meeting Supplies 8,400Meeting Supplies (Board & Committee) All Hands Meetings (2) 1-2010-0750-00 Non-Capital Equipment $11,000 1-2010-0750-00 Non-Capital Equipment Executive Assistant Office Alteration 1-2010-0750-06 Desktops 6,000Replacement PC for Executive Secretary Replacement PC for Management Analyst Replacement PC for Records Mgmt. Specialist Management/Department Meetings Employee Holiday Luncheon Employee Picnic 1-2010-0715-55 Adminstration Meeting OCWA General Meeting Supplies 1-2010-0690-00 Insurance $740 1-2010-0690-00 Insurance 740Notary Insurance (AA) Honesty Bond (MM & AA) 1-2010-0640-00 Dues, Memberships, & Subscriptions $50,085 1-2010-0640-00 Dues, Memberships, & Subscriptions 50,085LAFCO CRWUA AWWA Misc. Notary Assoc Membership ACWA 1-2010-0645-00 Fees & Permits $2,700,250 1-2010-0645-00 Fees & Permits 2,700,250SDLF District of Distinction Accreditation Fee SWRCB Penalty Fees Primary GL CategorySub Acct No./Sub CategoryDetail Item Description Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 37 Administration Budget Division Detail (FY 2015/16) Public Affairs Division Category Total Sub Acct Total Detail Amt 6,000 6,000 20,000 20,000 45,000 10,000 13,000 13,000 1,500 1,500 17,500 11,500 38,000 38,000 30,000 30,000 $5,000 5,000 5,000 500 1,000 600 800 $2,000 2,000 2,000 350 250 1,440 1,440 250 250 $2,500 2,500 2,500 1,400 2,600 1,000 650 300 500 2,500 2,500 $216,140 1-2020-0830-50 Meeting Mileage Mileage Section Total 1-2020-0810-00 Professional Dlt 1-2020-0810-00 Professional Development Training 1-2020-0830-00 Travel & Conferences $8,950 1-2020-0830-00 Travel & Conferences 6,450CAPIO Annual Conference PRSA Annual Best Practices Summit CRWUA UWI Conference Water Policy Dinners Other Meetings/Conferences 1-2020-0760-00 Office Expense $1,690 1-2020-0760-00 Office Expense Conservation Enforcement Supplies 1-2020-0760-21 Printer Supplies Printer Ink 1-2020-0710-00 Materials 1-2020-0710-77 Drought Materials Drought Material 1-2020-0715-00 District Meetings & Events $600 1-2020-0715-50 Meeting Supplies 600Intergovernmental Meetings Division Meetings 1-2020-0640-00 Dues, Memberships, & Subscriptions $2,900 1-2020-0640-00 Dues, Memberships, & Subscriptions 2,900OC Register/LA Times Chamber Memberships (YL, PL) CAPIO Membership PRSA Membership 1-2020-0580-50 Customer Communication Customer Newsletter 1-2020-0580-55 Water Conservation Programs MWDOC Choice Water Use Efficiency 1-2020-0600-00 Contractual Services 1-2020-0600-00 Contractual Services Conservation Rebate Prog. (Turf, Sprinklers, Appli 1-2020-0580-00 Communications $192,500 1-2020-0580-05 Advertising General 1-2020-0580-15 District Special Events Community Events (Open House, Facility Tours, etc. 1-2020-0580-35 Promotional Items 55,000YLWD Bottled Water 1-2020-0580-36 Water Conservation Citi Direct Mailing 1-2020-0580-40 Sponsorships Sponsorship- OC Water Summit 1-2020-0580-45 Video Productions 29,000Digital Communications History Wall Promotional Items Primary GL Category Sub Acct No./Sub Category Detail Item Description Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 38 Engineering Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 39 Engineering Department Budget (FY 2015/16) FY 2014/15 Budget FY 2015/16 Budget Expenses (Engineering) Salary Related Expenses Salaries 928,221$ 921,656$ Fringe Benefits 123,662$ 134,501$ Overtime 2,200$ 2,255$ Mandatory Benefits 124,485$ 95,414$ Total Salary Related Expenses 1,178,568$ 1,153,826$ Supplies & Services Communications -$ 200$ Contractual Services 96,160$ 103,190$ Data Processing -$ -$ Dues & Memberships 2,963$ 38,600$ Fees & Permits 28,050$ 28,000$ Materials 2,000$ 6,500$ District Activities/Meetings -$ 600$ Maintenance -$ 195$ Non-Capital Equipment 5,000$ 13,000$ Office Expense 2,950$ 7,600$ Professional Services 26,000$ 96,000$ Professional Development 3,850$ 4,920$ Travel & Conferences 3,300$ 6,000$ Supplies & Services Sub-Total170,273$ 304,805$ Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 40 Engineering Budget Division Detail (FY 2015/16) Administration Division Category Total Sub Acct Total Detail Amt $120 120120 $600 600600 $1,700 1,7001,700 3,5003,500 8,0008,000 $3,200 3,2003,200 $200 200200 800800 1,0001,000 $19,120 Primary GL Category Sub Acct No./Sub Category Detail Item Description 1-4010-0640-00 Dues, Memberships, & 1-4010-0640-00 Dues, Memberships, & S Dues, Memberships & Subscriptions 1-4010-0715-00 District Meetings and 1-4010-0715-50 General Meeting Expense Meeting/Event Supplies 1-4010-0710-00 Materials 1-4010-0710-00 Materials Emergency Food Supplies (1/3 of total) 1-4010-0750-00 Non-Capital Equipment $11,500 1-4010-0750-06 Desktops Replacement PC for Engineering Tech II 1-4010-0750-07 Notebooks/Tablets Replacement Laptops/Tablets 1-4010-0760-00 Office Expense 1-4010-0760-00 Office Expense Printer Ink 1-4010-0810-00 Professional 1-4010-0810-00 Training Training Section Total 1-4010-0830-00 Travel & Conferences $1,800 1-4010-0830-00 TRAVEL & CONFERENCES (E) Travel & Conferences 1-4010-0830-50 Meeting Mileage Mileage Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 41 Engineering Budget Division Detail (FY2015/16) Planning & Design Division Category Total Sub Acct Total Detail Amt $200 200200 17,400 4,200 10,000 500 250 5,000 25,000 1,000 4,200 $2,000 2,0002,000 3,2003,200 300300 50,000 1,000 30,000 15,00015,000 $700 700700 1,000 500 $171,450 Primary GL Category Sub Acct No./Sub Category Detail Item Description 1-4020-0580-00 Communications 1-4020-0580-00 Communications FOG Inspection Reports 1-4020-0600-00 Contractual Services $31,600 1-4020-0600-00 Contractual Services 31,600The Chambers Group (Hidden Hills) OCWD/ Well 21 Lease Agreement OCWD/ Well 22 Lease Agreement 1-4020-0640-00 Dues, Memberships, & Subscriptions $30,750 1-4020-0640-00 Dues, Memberships, & Subscriptions 30,750PE, BCEE ASCE Software License Renewal & Upgrade (Water Model) SCADA Watch (Water Model) 1-4020-0645-00 Fees & Permits $5,200 1-4020-0645-00 Fees & Permits 5,200FOG Inspection Fees (OCSD) OCWD/Well 21 Fee 1-4020-0710-00 Materials 1-4020-0710-00 Materials Emergency Preparedness Equipment & Materials 1-4020-0760-00 Office Expense $3,500 1-4020-0760-00 Office Expense Printer Ink 1-4020-0760-30 Books & Publications Books 1-4020-0780-00 Professional Services $96,000 1-4020-0780-00 Professional Services 81,000Urban Water Management Plan Update Water Master Plan Update Cathodic Protection Consulting Services 1-4020-0780-36 Professional Services - Water Water Consulting Services Section Total 1-4020-0810-00 Professional 1-4020-0810-00 Professional Development Certification Courses 1-4020-0830-00 Travel & Conferences $1,500 1-4020-0830-00 Travel & Conferences 1,500AWWA/ACE Conference Cathodic Protection Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 42 Engineering Budget Division Detail (FY 2015/16) Construction Division Category Total Sub Acct Total Detail Amt $2,500 2,5002,500 350 6,300 $1,500 1,5001,500 350350 250250 750 1,000 $500 500500 $13,500 1-4030-0830-00 Travel & Conferences 1-4030-0830-00 Travel & Conferences AWWA/ ACE Conference Section Total 1-4030-0810-00 Professional Development $1,750 1-4030-0810-00 Professional Development 1,750Inspector Certification Training (AWWA, CMAA) 1-4030-0750-00 Non-Capital Equipment 1-4030-0750-00 Non-Capital Equipment Inspection Related Tools & Equipment 1-4030-0760-00 Office Expense $600 1-4030-0760-00 Office Expense Office Supplies 1-4030-0760-30 Books & Publications Code Books 1-4030-0645-00 Fees & Permits 1-4030-0645-20 USA Underground Service USA Underground Service Alerts 1-4030-0640-00 Dues, Memberships, & Subscriptions $6,650 1-4030-0640-00 Dues, Memberships, & Subscriptions 6,650Construction Management Association of America EADOC Subscription (Planning Management Software) Primary GL Category Sub Acct No./Sub Category Detail Item Description Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 43 Engineering Budget Division Detail (FY 2015/16) Water Quality Division Category Total Sub Acct Total Detail Amt 3,000 3,000 3,000 3,000 5,590 5,590 60,000 60,000 300 20,000 80 1,000 $2,800 2,800 2,800 $195 195 195 $300 300 300 550 250 850 620 $2,200 2,200 2,200 $100,735 1-4040-0830-00 Travel & Conferences 1-4040-0830-00 Travel & Conferences AWWA/Water Quality Conference Section Total 1-4040-0760-00 Office Expense 1-4040-0760-30 Books & Publications AWWA Books 1-4040-0810-00 Professional Development $2,270 1-4040-0810-00 Professional Development 2,270Certifications AWWA WES August 13 (RM & AT) Backflow Specialist (AT) Misc AWWA Trainings 1-4040-0710-00 Materials 1-4040-0710-20 Wtr Quality Test Kit Reagents Wtr Quality Test Materials 1-4040-0730-00 Maintenance 1-4040-0730-10 Fume Hood Maintenance Maintenance & Testing 1-4040-0640-00 Dues, Memberships, & Subscriptions $1,080 1-4040-0640-00 Dues, Memberships, & Subscriptions 1,080ABPA (Maldonado) Water Purveyor Membership 1-4040-0645-00 Fees & Permits $20,300 1-4040-0645-10 Dept of Health Services 20,300County of Orange Dept. of Health Services (SWRCB-DD) 1-4040-0600-00 Contractual Services $71,590 1-4040-0600-00 CONTRACTUAL SERVICES System Disinfection/Blending 1-4040-0600-12 Backflow Device Rep Backflow Device Repair 1-4040-0600-25 Distrubution System Distribution System Disinfection 1-4040-0600-60 Microbiological Examination Water Quality Laboratory Testing Primary GL Category Sub Acct No./Sub Category Detail Item Description Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 44 Finance Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 45 Finance Department Budget (FY 2015/16) FY 2014/15 Budget FY 2015/16 Budget Expenses (Finance) Salary Related Expenses Salaries 843,820$ 883,762$ Fringe Benefits162,275$ 169,176$ Overtime6,200$ 6,355$ Mandatory Benefits104,142$ 88,388$ Total Salary Related Expenses1,116,437$ 1,147,681$ Supplies & Services Communications101,400$ 105,625$ Contractual Services101,870$ 82,210$ Data Processing-$ 61,020$ Dues & Memberships785$ 535$ Fees & Permits121,090$ 145,165$ Insurance600$ 600$ Materials25,000$ 197,000$ District Activities & Events1,050$ 1,100$ Maintenance300$ 300$ Non-Capital Equipment950$ 6,400$ Office Expense14,050$ 15,470$ Professional Services27,660$ 28,260$ Professional Development3,830$ 4,265$ Travel & Conferences3,900$ 7,525$ Uncollectible Accounts40,000$ 40,000$ Supplies & Services Sub-Total442,485$ 695,475$ Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 46 Finance Budget Division Detail (FY 2015/16) Administration Division Category Total Sub Acct Total Detail Amt $400 400400 $49,500 49,500 49,500 110 155 160 $600 600 600 $400 400 400 18,960 2,600 5,000 1,200 300 325 300 500 1,500 500 500 $83,010 Primary GL Category Sub Acct No./Sub Category Detail Item Description 1-3010-0600-00 Contractual Services 1-3010-0600-00 CONTRACTUAL SERVICES (E) Check signature plate 1-3010-0620-00 Data Processing 1-3010-0620-20 Software License Renewals GP & CSM Annual Maintenance Fee 1-3010-0640-00 Dues, Memberships, & Subscriptions $425 1-3010-0640-00 Dues, Memberships, & Subscriptions 425CSMFO CMTA GFOA 1-3010-0690-00 Insurance 1-3010-0690-00 Insurance Honesty Bond 1-3010-0715-00 District Meetings and Et 1-3010-0715-50 Meeting Supplies Meeting Supplies 1-3010-0780-00 Professional Services $27,760 1-3010-0780-00 Professional Services 27,760Auditors GASB 68 Statement Preparation Actuarial Services CDAR Preparation 1-3010-0810-00 Professional Development $925 1-3010-0810-00 Professional Development 925CMTA Seminars 2014 Government Tax Update CSMFO Workshops Section Total 1-3010-0830-00 Travel & Conferences $3,000 1-3010-0830-00 Travel & Conferences 3,000CalPERS Annual Conference CSMFO Conference AWWA Conference CMTA Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 47 Finance Budget Division Detail (FY 2015/16) Accounting Division Category Total Sub Acct Total Detail Amt $625 625625 500 360 150 435 330 25 50,000 225 $110 110110 $400 400400 $300 300300 500500 2,0002,000 1,5001,500 9,0009,000 3,5003,500 1,2001,200 $1,000 1,0001,000 1,000 1,500 500 $75,160 Primary GL Category Sub Acct No./Sub Category Detail Item Description 1-3020-0580-00 Communications 1-3020-0580-00 Communications Publish Unclaimed List 1-3020-0600-00 Contractual Services $860 1-3020-0600-00 Contractual Services 860Green Shades Doculivery 1-3020-0645-00 Fees & Permits $51,165 1-3020-0645-00 Fees & Permits 915CSMFO Budget Reviewer Fee GFOA CAFR Reviewer Fee GFOA Budget Award Reviewer Fee 1-3020-0645-50 Bank Service/Fees 50,250Annual Bankcard Fee Analysis Fees (Avg $4800/mo) Safe Deposit Box Fee 1-3020-0640-00 Dues, Memberships, & CSMFO 1-3020-0730-00 Maintenance 1-3020-0730-00 Maintenance Small Office Equipment Maintenance 1-3020-0715-00 District Meetings and 1-3020-0715-50 Meetin g Supplies Meeting Supplies 1-3020-0640-00 Dues , Memberships , & 1-3020-0750-00 Non-Capital Equipment $4,000 1-3020-0750-00 Non-Ca pital Equipment Ergotron/Veridesk 1-3020-0750-06 Deskto ps Dell Computer 1-3020-0750-41 Audio/Visual Monitors 1-3020-0760-00 Office Expense $13,700 1-3020-0760-00 Office Expense Office Supplies 1-3020-0760-10 Pa per Paper 1-3020-0760-21 Printer Su pplies Printer Cartridges Section Total 1-3020-0810-00 Professional 1-3020-0810-00 Professional Development Staff Training 1-3020-0830-00 Travel & Conferences $3,000 1-3020-0830-00 Travel & Conferences 3,000CSMFO Conference CalPERS Annual Conference CMTA Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 48 Finance Budget Division Detail (FY 2015/16) Customer Service/Billing Division Category Total Sub Acct Total Detail Amt 500500 5,5005,500 99,00099,000 250 1,500 1,600 4,000 600 20,000 48,000 5,0005,000 $11,520 11,52011,520 34,000 60,000 $300 300300 $500 500500 350 300 1,000 1,000 $500 500 500 $1,400 1,400 1,400 500 500 325 325 $40,000 40,000 40,000 $336,645 Primary GL Category Sub Acct No./Sub Category Detail Item Description 1-3030-0600-22 Printing of Bills - Infosend 68,000Info Send E-Bill Fees 1-3030-0580-00 Communications $105,000 1-3030-0580-00 Communications AB 2747 Compliance 1-3030-0580-10 Postage Postage Metered 1-3030-0580-22 Postage - Infosend Postage - Infosend Post Office Box Meter & Scale Lease Agreement Post Master - Lockbox 1-3030-0600-21 Customer Credit Check 4,600Online - Credit Checks Online - Utility Exchange Mailing Service 1-3030-0620-00 Data Processing 1-3030-0620-00 Data Processing Cogsdale - Penalty Blocks 1-3030-0645-00 Fees & Permits $94,000 1-3030-0645-50 Bank Services/Fees 94,000Lock Box Services Credit Card & Auto Dr Processing 1-3030-0600-55 Answering Service Phone Answering Service 1-3030-0600-00 Contractual Services $80,950 1-3030-0600-00 Contractual Services 3,350 1-3030-0715-00 District Meetings and 1-3030-0715-50 General Meeting Expense Meeting Supplies 1-3030-0750-00 Non-Capital Equipment 1-3030-0750-00 Non-Capital Equipment Letter Folding Equipment 1-3030-0760-00 Office Expense $1,650 1-3030-0760-00 Office Expense 650Postage Machine Supplies Forms/Deposit Slips 1-3030-0760-21 Printer Supplies Printer Cartridge 1-3030-0780-00 Professional Services 1-3030-0780-09 Collection Services Collection Agency Fee 1-3030-0810-00 Professional 1-3030-0810-00 Professional Development Customer Service Training (min of 2 classes PP) 1-3030-0830-00 Travel & Conferences $825 1-3030-0830-00 Travel & Conferences AWWA 1-3030-0830-50 Meeting Mileage Mileage Reimbursement 1-3030-0850-00 Uncollectible Accounts 1-3030-0850-00 Uncollectible Accounts Uncollectible Accounts Section Total Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 49 Finance Budget Division Detail (FY 2015/16) Meter Reading Division Category Total Sub Acct Total Detail Amt 140,000 140,000 25,000 25,000 9,000 9,000 23,000 23,000 500 400 1,000 1,000 120 120 120 700 700 240 240 700 700 700 $200,660 1-3040-0830-00 Travel & Conferences 1-3040-0830-00 Travel & Conferences AWWA Conference Section Total 1-3040-0760-00 Office Expense 1-3040-0760-21 Printer Supplies Printer Cartirdge 1-3040-0810-00 Professional Development 940 1-3040-0810-00 Professional Development Training classes 1-3040-0810-40 Certificate Reimbursement Certificate Reimbursement 1-3040-0750-00 Non-Capital Equipment 1,900 1-3040-0750-00 Non-Capital Equipment 900 Meter Shop Equipment Construction Meter Locks 1-3040-0750-07 Notebooks/Tablets Tablets 1-3040-0710-00 Materials 197,000 1-3040-0710-40 Replacment Meters Replacement Meters 1-3040-0710-50 Replacement MXU MXUs 1-3040-0710-55 Meters Boxes/Lids/Vaults Meter Boxes/Lids/Vaults 1-3040-0710-58 Registers Registers Primary GL Category Sub Acct No./Sub Category Detail Item Description Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 50 Human Resources Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 51 Human Resources Department Budget (FY 2015/16) FY 2014/15 Budget FY 2015/16 Budget Expenses (HR) Salary Related Expenses Salaries 373,949$ 457,116$ Fringe Benefits75,009$ 83,944$ Overtime1,689$ 1,731$ Mandatory Benefits44,874$ 46,566$ Total Salary Related Expenses495,521$ 589,357$ Supplies & Services Communications3,000$ 3,000$ Contractual Services34,150$ 25,870$ Dues & Memberships5,635$ 7,960$ Insurance311,500$ 295,000$ Materials1,400$ 1,100$ District Activities & Events17,510$ 12,610$ Non-Capital Equipment-$ 3,800$ Office Expense700$ 1,865$ Professional Services70,700$ 104,700$ Professional Development25,500$ 24,500$ Travel & Conferences5,100$ 9,200$ Supplies & Services Sub-Total475,195$ 489,605$ Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 52 Human Resources Budget Division Detail (FY 2015/16) Administration Division Category Total Sub Acct Total Detail Amt $3,000 3,0003,000 600 3,000 3,000 5,000 500 3,000 3,000 1,500 1,500 5,000 1,300 4,000 525 85 400 300 2,000 210 1,000 2,200 2,200 2,000 2,000 1,000 1,000 3,000 800 300 300 609 206 250 250 90,000 90,000 13,700 13,700 8,000 8,000 3,000 3,000 5,800 400 $165,685Section Total 1-7010-0830-00 Travel & Conferences $6,200 1-7010-0830-00 Travel & Conferences 6,200LCW (3 employees) Public Retirement Seminar (2 employees) 1-7010-0810-00 Professional Development $11,000 1-7010-0810-00 Professional Development LCW 1-7010-0810-20 Job Training On-going Job Training 1-7010-0780-00 Professional Services $103,700 1-7010-0780-05 Legal Services Liebert Cassidy Whitmore Employment Law 1-7010-0780-55 Investigations Investigations, Backgrounds, and EE Relations 1-7010-0760-00 Office Expense $1,365 1-7010-0760-00 Office Expense Office Supplies 1-7010-0760-21 Printer Supplies 815Brother MFC-9970CDW (2 black & 3 color (1 each)) HL2270DW (3) 1-7010-0760-30 Books & Publications Public Retirement Journal 1-7010-0750-00 Non-Capital Equipment $3,800 1-7010-0750-07 Notebooks/Tablets 3,800Laptop Tablet 1-7010-0715-00 District Meetings and Events $8,410 1-7010-0715-20 District Events - Employee Recognition 3,210Retiree Event (2) Retiree Recognition Service Recognition 1-7010-0715-30 District Events - Benefit Fair Benefit Fair 1-7010-0715-40 District Events - Employee Employee Promotional Items 1-7010-0715-50 General Meeting Expense Meeting/Training Supplies 1-7010-0600-30 Health & Welfare 6,300Interactive Process Flu Shots 1-7010-0640-00 Dues, Memberships & Subscriptions $5,310 1-7010-0640-00 Dues, Memberships & Subscriptions 5,310LCW (Consortium & Library) PELRAC Jobs Available Subscription CALPELRA Annual Dues National Notary Association 1-7010-0580-00 Communications 1-7010-0580-05 Advertising Job Advertising Expenses 1-7010-0600-00 Contractual Services $22,900 1-7010-0600-00 Contractual Services 12,100COBRA Solutions CPS (Testing) - Human Resources Neo Gov- Online Applications Neo Gov- Performance Evaluations Flex Advantage 1-7010-0600-10 DOT Physicals Fit for Duty 1-7010-0600-20 Post-Employment Physicals Post-Employment Physicals Primary GL Category Sub Acct No./Sub Category Detail Item Description Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 53 Human Resources Budget Division Detail (FY 2015/16) Risk Management Division Category Total Sub Acct Total Detail Amt 420 300 100 700 5,0005,000 230,000230,000 60,00060,000 $500 500500 $1,000 1,0001,000 $500 500500 $3,000 3,0003,000 $301,520 Primary GL Category Sub Acct No./Sub Category Detail Item Description 1-7020-0600-00 Contractual Services $720 1-7020-0600-00 Contractual Services 720DOT Physicals (12 x 35) Respiratory Fit Testing (60 x 5) 1-7020-0640-00 Dues, Memberships, & Subscriptions $800 1-7020-0640-00 Dues, Memberships, & Subscriptions 800PARMA Membership AED Medical Director Oversight 1-7020-0690-00 Insurance $295,000 1-7020-0690-10 Tort Claims Tort Claims - < 15K 1-7020-0690-20 Liability Insurance ACWA-JPIA Liability Insurance 1-7020-0690-30 Property Insurance ACWA-JPIA Property Insurance 1-7020-0760-00 Office Expense 1-7020-0760-00 Office Expense Ergotron Desks & Mats (1 x 500) 1-7020-0780-00 Professional Services 1-7020-0780-00 Professional Services First Aid-Injured Workers Section Total 1-7020-0810-00 Professional 1-7020-0810-00 Professional Development Risk Management Training 1-7020-0830-00 Travel & Conferences 1-7020-0830-00 Travel & Conferences PARMA Conference (2 x $1,500) Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 54 Human Resources Budget Division Detail (FY 2015/16) Safety Division Category Total Sub Acct Total Detail Amt 1,250 1,000 500 150 200 1,000 600 500 1,200 3,000 8,0008,000 5,0005,000 $22,400 Primary GL Category Sub Acct No./Sub Category Detail Item Description 1-7030-0600-00 Contractual Services $2,250 1-7030-0600-00 Contractual Services 2,250HEP B ($250 x 5) Industrial Hearing Management 1-7030-0640-00 Dues, Memberships, & Subscriptions $1,850 1-7030-0640-00 Dues, Memberships, & Subscriptions 1,850Cal-OSHA Reporter PASMA (2 x 75) Safety Center Inc. Online SDS Support 1-7030-0710-00 Materials $1,100 1-7030-0710-00 Materials 1,100First Aid Restocker First Aid Supplies (Field Backpacks) 1-7030-0715-00 District Meetings and Events $4,200 1-7030-0715-50 General Meeting Expense 4,200Meeting/Training Supplies Safety WORKS (Promo Safety Recognition) Section Total 1-7030-0810-00 Professional Development $13,000 1-7030-0810-10 OSHA Compliance OSHA Compliance Training 1-7030-0810-20 Job Training On Job Training Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 55 Information Technology Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 56 Information Technology Department Budget (FY 2015/16) FY 2014/15 Budget FY 2015/16 Budget Expenses (IT) Salary Related Expenses Salaries 602,394$ 472,163$ Fringe Benefits 91,979$ 57,830$ Overtime 10,400$ 2,460$ Mandatory Benefits 75,102$ 48,943$ Total Salary Related Expenses 779,875$ 581,396$ Supplies & Services Communications -$ -$ Contractual Services 143,120$ 148,385$ Data Processing 186,830$ 125,309$ Dues & Memberships 1,622$ 280$ Materials 15,825$ 2,400$ District Activities & Events 300$ 800$ Maintenance 79,250$ 6,900$ Non-Capital Equipment 98,950$ 40,800$ Office Expense 15,025$ 7,825$ Professional Services 91,500$ 95,000$ Professional Development 11,800$ 11,000$ Travel & Conferences 9,700$ 15,600$ Supplies & Services Sub-Total 653,922$ 454,299$ Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 57 IT Budget Division Detail (FY 2015/16) Administration Division Category Total Sub Acct Total Detail Amt $200 200200 $500 500500 $2,000 2,0002,000 $675 675675 $500 500500 1,600 2,600 1,400 3,500 $12,975 Primary GL Category Sub Acct No./Sub Category Detail Item Description 1-6010-0640-00 Dues, Memberships, & 1-6010-0640-00 Dues, Memberships, & MISAC 1-6010-0715-00 District Meetings and 1-6010-0715-50 General Meeting Expense Meeting Supplies 1-6010-0750-00 Non-Capital Equipment 1-6010-0750-10 Desktops PC 1-6010-0760-00 Office Expense 1-6010-0760-21 Printer Supplies Printer Cartridge Emergency Backup Location Visits Section Total 1-6010-0810-00 Professional 1-6010-0810-00 Professional Development Pluralsight Tech Library 1-6010-0830-00 Travel & Conferences $9,100 1-6010-0830-00 Travel & Conferences 9,100Interop (April/May) WinConnections (November) MISAC Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 58 IT Budget Division Detail (FY 2015/16) Information Systems Division Category Total Sub Acct Total Detail Amt 1,800 85 600 15,000 4,500 12,500 21,000 4,000 3,900 26,50026,500 15,00015,000 25,000 15,000 3,500 4,000 2,400 3,200 2,000 30,000 250 12,000 1,000 7,000 5,000 13,500 0 6,109 750 1,500 200 0 150 200 150 30 50 200200 400 100 200 200 900 400 Primary GL Category Sub Acct No./Sub Category Detail Item Description 1-6020-0600-00 Contractual Services $148,385 1-6020-0600-00 Contractual Services 1,885Security Solutions: Annual Fire & Burglar Alarm District Site Hosting 1-6020-0600-10 Data Hosting 15,600FTP Today for ftp service ($54.95/month) DR Location 1-6020-0600-20 Lease Agreements 17,000Konica Minolta Operations Copier Lease Konica Minolta Copier Leases for Admin Building 1-6020-0600-30 Warranties & Service Contracts 28,900RMJ Tech. GPS Vehicle Tracking Service Dell Hardware Service Contracts APC Symmetra Data Center UPS On-Site Service Rene 1-6020-0600-32 Service for Cell Phones Cell Phone Service (Verizon) 1-6020-0600-33 Mobile Broadband Service Verizon Broadband Aircard Service (MGMT/CMMS) 1-6020-0600-34 Communication Lines 43,500Time Warner Cable & Dedicated Internet Access 50x AT&T District Lines DR Communication Lines Microsoft Volume License Renewals Lenel Onguard Software Support Agreement Renewal Solar Winds Orion Monitoring Tool Maintenance Solar Winds Engineering's Toolkit Renewal VMWare vSphere (Essentials Plus Kit) Maintenance Appassure Backup Software Renewal 1-6020-0620-00 Data Processing $89,409 1-6020-0620-10 Software Purchases 6,400CMMS Licensing Solarwind SQL Monitor 1-6020-0620-20 Software License Renewals 73,950Trend Micro NeatSuite Antivirus & Spyware 110 lic Netmotion Mobility XE Premium Software Maintenanc CityWorks Annual Maintenance Specter Soft Renewal 1-6020-0620-30 Hardware Subscription Renewals 8,559Watchguard XTM810 Firewall UTM Renewal (2 items) Barracuda Spam Firewall Energizer Annual Renewal Barracuda Message Archiver Energizer Annual Renew PageR Monitoring Idealstor Archiver ($3,000) 1-6020-0620-47 Cell Phone Supplies 500Chargers Batteries Holsters & Covers 1-6020-0640-00 Dues, Memberships, & Subscriptions $80 1-6020-0640-00 Dues, Memberships, & Subscriptions 80CPU 1-6020-0710-60 Hardware Supplies 1,500USB Drives USB Keys, SD / micro SD Cards Desktop peripherals Hardware supplies, AA & AAA batteries PCWorld 1-6020-0710-00 Materials $2,400 1-6020-0710-00 Materials Materials 1-6020-0710-51 Cabling 700Duplex 50/125 LC/LC fiber, CAT6A, CAT5e patch cab Adapters DVI, VGA, DB9, Display Port, HDMI, USB cables Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 59 IT Budget Division Detail (FY 2015/16) Information Systems Division, Continued Category Total Sub Acct Total Detail Amt $300 300300 850850 1,2001,200 400 800 400 400 1,5001,500 1,000 350 2,0002,000 2,0002,000 20,000 1,500 0 200 1,500 200 800 2,200 800800 500 1,000 1,0001,000 1,0001,000 100100 2,000 50 200 200 400 200 5,5005,500 3,500 50,000 1,0001,000 2,500 1,000 2,200 1,000 400 1,600 $354,024 1-6020-0715-00 District Meetings and 1-6020-0715-50 Meeting Supplies Meeting Supplies Primary GL Category Sub Acct No./Sub Category Detail Item Description Phone Switch Servicing Security Equipment Maintenance & Repair 1-6020-0730-30 Cabling & WAN Cabling (CAT6A, CAT5e, fiber) installation & rep ( 1-6020-0730-60 UPS & Back-up Power systems 1,350APC Symmetra Data Center UPS battery modules (6) UPS replacement batteries for desktops 1-6020-0730-00 Maintenance $6,900 1-6020-0730-00 Maintenance Maintenance 1-6020-0730-06 Printer Servicing HP Printer Servicing 1-6020-0730-11 Telco/Phone Servicing 2,000Building Line Repairs Cell Phone Servicing/replacement/repair Tablets 1-6020-0750-09 Networking Equipment 4,900KVM System Interface Pods Network Storage Devices Network Office/cubicle Switches Misc Network Equipment such as Transceivers Data Center Switches 1-6020-0750-00 Non-Capital Equipment $34,700 1-6020-0750-00 Non-Capital Equipment Non-Capital Equipment 1-6020-0750-06 Desktops Dell Optiplex PCs 1-6020-0750-07 Notebooks 21,500CMMS Notebooks and Equipment Dell Notebooks 1-6020-0760-00 Office Expense $3,150 1-6020-0760-00 Office Expense Business Cards 1-6020-0760-21 Printer Supplies 2,050 1-6020-0750-30 Tools & Equipment Data Center equipment (Rack & Cabinet) 1-6020-0750-35 Security 1,500HID proximity badges for building access FABS HP LaserJet Printers & Copier toners fusers etc Konica Minolta Copier/Printer Supplies Mail Room 1-6020-0760-26 Desktop Supplies 1,000Mice Blank DVD+R, CD Disc, USB Keys etc. Keyboards Misc 1-6020-0750-41 Audio/Visual Replacement LCD Monitors 1-6020-0750-45 Telco Phones & Accessories 1-6020-0810-00 Professional Development $3,500 1-6020-0810-00 Professional Development 3,500GeneralTraining Plural Site 1-6020-0780-00 Professional Services $60,000 1-6020-0780-11 Network/Hardware Consulting Network Engineering Consulting 1-6020-0780-20 Software Consulting 53,500Software Consulting CMMS Consulting EEC 1-6020-0780-50 Technical Support Technical Support Section Total 1-6020-0830-00 Travel & Conferences $5,200 1-6020-0830-00 Travel & Conferences 5,200Intersect (October) R.S. CityWorks User's Conference (June) R.S. Mileage and Travel Reimbursement Interop Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 60 IT Budget Division Detail (FY 2015/16) GIS Division Category Total Sub Acct Total Detail Amt 4,000 2,000 3,200 6,100 900 3,500 1,700 14,500 $4,100 4,1004,100 $4,000 4,0004,000 $35,000 35,00035,000 3,000 4,000 1,050 250 $87,300 Primary GL Category Sub Acct No./Sub Category Detail Item Description 1-6030-0620-00 Data Processing $35,900 1-6030-0620-20 Software License Renewals 35,900InfoWater Renewal & Upgrade Floating License Freeance Maintenance ArcEditor Concurrent Maintenance (2) ArcGIS Server Standard Enterprise Maintenance ArcView Single Use Maintenance ArcInfor Concurrent Maintenance AutoCAD & Map 3D Maintenance Satellite Imagry 1-6030-0750-30 Tools & Equipment GIS Miscellaneous Tools (Hardware) 1-6030-0780-00 Professional Services 1-6030-0780-20 Software Consulting GIS Staff Augmentation & Cons. Services, EEC 1-6030-0760-00 Office Expense 1-6030-0760-21 Printer Supplies Atlas Water & Sewer Supplies 1-6030-0750-00 Non-Capital Equipment 1-6030-0810-00 Professional Development $7,000 1-6030-0810-00 Professional Development 7,000GIS Analyst Training GIS and CMMS Training, EEC Section Total 1-6030-0830-00 Travel & Conferences $1,300 1-6030-0830-00 Travel & Conferences 1,300GIS ESRI User Conference Mileage and Travel Reimbursement Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 61 Operations Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 62 Operations Department Budget (FY 2015/16) FY 2014/15 Budget FY 2015/16 Budget Expenses (Operating) Salary Related Expenses Salaries 2,574,013$ 2,767,635$ Fringe Benefits535,515$ 551,814$ Overtime192,600$ 204,813$ Mandatory Benefits420,823$ 364,601$ Total Salary Related Expenses3,722,951$ 3,888,862$ Supplies & Services Communications500$ 200$ Contractual Services176,500$ 220,000$ Data Processing-$ 47,500$ Dues & Memberships700$ 1,250$ Fees & Permits37,050$ 53,250$ Materials613,900$ 586,950$ District Activities & Events1,200$ 2,000$ Maintenance427,471$ 739,950$ Non-Capital Equipment47,100$ 92,750$ Office Expense7,500$ 5,750$ Professional Services-$ 61,500$ Professional Development12,750$ 12,550$ Travel & Conferences5,600$ 19,880$ Utilities 90,800$ 90,850$ Vehicle Expense358,400$ 372,433$ Supplies & Services Sub-Total1,779,471$ 2,306,813$ Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 63 Operations Budget Division Detail (FY 2015/16) Administration Division Category Total Sub Acct Total Detail Amt $13,000 13,00013,000 $150 150 150 $2,000 2,000 2,000 $18,000 18,000 18,000 1,000 1,000 10,000 10,000 2,700 2,700 250 250 2,500 2,500 500 500 300 300 1,000 1,000 3,000 3,000 1,500 1,500 2,500 2,500 560 560 $58,960 1-5010-0830-50 Meeting Mileage Mileage Section Total 1-5010-0830-00 Travel & Conferences $8,560 1-5010-0830-10 Travel AWWA (Fall & Spring), CWEA 1-5010-0830-20 Lodging AWWA (Fall & Spring), CWEA 1-5010-0830-30 Meals AWWA (Fall & Spring), CWEA 1-5010-0830-40 Registration AWWA (Fall & Spring), CWEA 1-5010-0810-00 Professional Development $800 1-5010-0810-00 Professional Development Training 1-5010-0810-40 Certificate Reimbursement Certificate Reimbursement 1-5010-0760-00 Office Expense $5,450 1-5010-0760-20 Printer Ink Printer Ink 1-5010-0760-30 Books & Publications Manuals/Books/Magazines 1-5010-0760-40 Breakroom Supplies Breakroom Supplies 1-5010-0750-00 Non-Capital Equipment $11,000 1-5010-0750-41 Audio/Visual Computer Monitor Upgrade 1-5010-0750-50 Safety Equipment Safety Equipment (Regulatory Requirements) 1-5010-0715-00 District Meetings and 1-5010-0715-50 General Meeting Expense Meeting Supplies 1-5010-0710-00 Materials 1-5010-0710-65 PPE Equipment PPE Equipment 1-5010-0600-00 Contractual Services 1-5010-0600-50 Uniforms Uniforms (District-wide) 1-5010-0640-00 Dues, Memberships, & 1-5010-0640-00 Dues, Memberships, & Dues, Memberships, & Subscriptions Primary GL Category Sub Acct No./Sub Category Detail Item Description Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 64 Operation Budget Division Detail (FY 2015/16) Water Operation & Maintenance Division Category Total Sub Acct Total Detail Amt 2,100 2,100 10,000 10,000 5,000 5,000 30,000 30,000 4,500 4,500 10,000 10,000 100,000 100,000 85,000 85,000 27,500 27,500 5,000 5,000 1,500 1,500 7,000 7,000 90,000 90,000 12,000 12,000 2,000 2,000 4,000 4,000 20,000 20,000 25,000 25,000 150,000 150,000 45,000 45,000 1,000 1,000 1,500 1,500 500 500 8,500 8,500 2,000 2,000 1,500 1,500 $6,500 6,500 6,500 $657,100 Primary GL Category Sub Acct No./Sub Category Detail Item Description 1-5020-0645-00 Fees & Permits $17,100 1-5020-0645-25 NPDES/RWQCB NPDES Deminimus (RWQCB) 1-5020-0645-45 Landfill (Orange County & Dan Landfill (Orange County & Dan Coop) 1-5020-0645-55 Encroachment Permits Encroachment Permits 1-5020-0710-00 Materials $378,500 1-5020-0710-05 Road Material Road Material 1-5020-0710-13 Air-Vac Parts Air-Vac parts 1-5020-0710-15 Cla-Valve Parts Cla Valve Parts 1-5020-0710-25 Hydrant Repair Parts Hydrant Repair Parts 1-5020-0710-30 Valve Repair Parts Valve Repair Parts 1-5020-0710-36 City of YL Valve Adjustments City of YL Valves 1-5020-0710-60 Hardware Supplies Hardware Supplies 1-5020-0710-81 Welding Supplies Welding Supplies 1-5020-0710-85 Cleaning/Painting Supplies Cleaning/Painting Supplies 1-5020-0710-90 Water Service Repair Parts Water Service Repair Parts 1-5020-0730-66 Asphalt Paving Asphalt Paving 1-5020-0730-67 Concrete Repair Concrete Repair 1-5020-0710-94 Miscellaneous Warehouse Miscellaneous Warehouse Parts 1-5020-0710-96 Ready Mix Concrete Ready Mix Concrete 1-5020-0710-98 Landscape Supplies Landscape Supplies 1-5020-0730-72 Safety Equipment Repairs Safety Equipment Repairs 1-5020-0750-00 Non-Capital Equipment $10,500 1-5020-0750-06 Desktops Replacement Desktop 1-5020-0750-15 Equipment Rental Equipment Rental 1-5020-0750-30 Tool & Equipment Tool & Equipment 1-5020-0730-00 Maintenance $241,000 1-5020-0730-36 City of Yorba Linda Value City of Yorba Linda Valve Repair 1-5020-0730-43 Value Repair Valve Repair (Normal Business) 1-5020-0810-00 Professional Development $3,500 1-5020-0810-00 Professional Development Training 1-5020-0810-40 Certificate Reimbursement Certificate Reimbursement 1-5020-0830-00 Travel & Conferences 1-5020-0830-00 Travel & Conferences AWWA Conference (5 Employees) Section Total Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 65 Operation Budget Division Detail (FY 2015/16) Sewer Operation & Maintenance Division Category Total Sub Acct Total Detail Amt $200 200200 $300 300300 2,2002,200 1,0001,000 1,0001,000 27,50027,500 25,00025,000 250,000250,000 3,0003,000 10,00010,000 1,5001,500 15,00015,000 1,5001,500 20,00020,000 4,0004,000 15,00015,000 1,8001,800 400400 300300 1,2001,200 720720 1,2001,200 $850 850850 25,00025,000 1,0001,000 8,0008,000 15,50015,500 $433,170 Primary GL Category Sub Acct No./Sub Category Detail Item Description 2-5030-0580-00 Communications 2-5030-0580-00 Communications Public Communications 2-5030-0640-00 Dues, Memberships, 2-5030-0640-00 Dues, Memberships, CWEA Memberships 2-5030-0645-00 Fees & Permits $3,200 2-5030-0645-30 WDR - SSO (SWRCB) WDR - SSO (SWRCB) 2-5030-0645-55 Encroachment Permits Encroachment Permits 2-5030-0710-00 Materials $53,500 2-5030-0710-60 Hardware Supplies Hardware Supplies 2-5030-0710-86 Placentia/Yorba Linda Island City of Yorba Linda Manholes 2-5030-0710-92 Sewer Main Repair Parts Sewer Main Repair Parts 2-5030-0730-00 Maintenance $301,000 2-5030-0730-59 Sewer Line Repairs Sewer Line Repairs 2-5030-0730-65 Vector Control In Manholes Vector Control in Manholes 2-5030-0730-66 Asphalt Paving Asphalt Paving 2-5030-0730-67 Concrete Repair Concrete Repair 2-5030-0730-71 CCTV Repairs CCTV Repairs 2-5030-0730-72 Safety Equipment Repairs Safety Equipment Repairs 2-5030-0730-86 Placentia/Yorba Linda City of Yorba Linda Manhole Labor 2-5030-0750-00 Non-Capital Equipment $19,000 2-5030-0750-06 Desktops Replacement Computer for Sewer Camera Truck 2-5030-0750-30 Tools & Equipment Tools & Equipment 2-5030-0810-00 Professional Development $2,200 2-5030-0810-00 Professional Development PACP Training Course 2-5030-0810-40 Certificate Reimbursement Certificate Reimbursement 2-5030-0830-00 Travel & Conferences $3,420 2-5030-0830-10 Travel PACP Conference 2-5030-0830-20 Lodging PACP Conference 2-5030-0830-30 Meals PACP Conference 2-5030-0830-40 Registration PACP Conference Section Total 2-5030-0870-00 Utilities 2-5030-0870-10 Electric Electric 2-5030-0890-00 Vehicle Expenses $49,500 2-5030-0890-46 Vehicle Expense: Sewer OPS - Sewer Vehicle Maint 2-5030-0890-47 Vehicle Expense: Sewer OPS - Sewer - Equipment Maintenance 2-5030-0890-48 Vehicle Expense: Sewer Gas OPS - Sewer - Gas 2-5030-0890-49 Vehicle Expense: Sewer OPS - Sewer - Diesel Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 66 Operation Budget Division Detail (FY 2015/16) Water Production Division Category Total Sub Acct Total Detail Amt $50 5050 4,0004,000 35,00035,000 3,0003,000 50,00050,000 10,00010,000 500500 25,00025,000 5,0005,000 10,00010,000 12,00012,000 5,0005,000 5,0005,000 2,5002,500 1,5001,500 5,0005,000 1,0001,000 600600 $175,150 Primary GL Category Sub Acct No./Sub Category Detail Item Description 1-5040-0640-00 Dues, Memberships, 1-5040-0640-00 Dues, Memberships, OCWA Memberships 1-5040-0710-00 Materials $102,500 1-5040-0710-17 Pump Station Repair Parts Pump Parts 1-5040-0710-35 CL2 Parts CL2 Parts 1-5040-0710-60 Hardware Supplies 1-5040-0730-20 General Electric Services Electric General Maintenance 1-5040-0730-24 Reservoir Services Reservoir Repairs Hardware Supplies 1-5040-0710-75 Salt Salt (Water Softeners) 1-5040-0710-84 Production Repair Parts Valves, Gauges, AV, etc. 1-5040-0710-85 Cleaning/Painting Supplies Cleaning/Painting Supplies 1-5040-0730-29 Wells: Calibration, Mtce, Well Maintenance 1-5040-0730-75 Pump Station Repairs Pump Station Repairs 1-5040-0750-00 Non-Capital Equipment $9,000 1-5040-0750-07 Notebooks/Tablets Laptop 1-5040-0750-30 Tools & Equipment Tools & Equipment 1-5040-0730-00 Maintenance $62,000 1-5040-0730-05 CL2 System Service CL2 System Service 1-5040-0730-10 Motor Services Electrical Motor Repairs/Services Section Total 1-5040-0750-90 Emergency Equipment Hoses/Fittings/Cabling for Pumps/Generators 1-5040-0810-00 Professional Development $1,600 1-5040-0810-00 Professional Development Training 1-5040-0810-40 Certificate Reimbursement Certificate Reimbursment Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 67 Operation Budget Division Detail (FY 2015/16) SCADA Division Category Total Sub Acct Total Detail Amt 1,500 2,500 1,500 26,00026,000 8,0008,000 29,500 3,500 2,000 4,500 $250 250250 3,0003,000 3,8003,800 850850 2,000 3,000 3,000 2,2002,200 28,00028,000 4,0004,000 4,6504,650 9,5009,500 500 11,000 3,100 1,500 800 3,2003,200 5,5005,500 4,0004,000 5,0005,000 Primary GL Category Sub Acct No./Sub Category Detail Item Description 1-5045-0600-00 Contractual Servcies $31,500 1-5045-0600-30 Warranties & Services Contracts 5,500Cisco Smartnet Premium (for Cisco 1842 Routers) Cisco Smartnet Premium (for Cisco 3825 Router) Dell Servers Service Contract 1-5045-0600-34 Communication LInes Communications Lines 1-5045-0620-00 Data Processing $47,500 1-5045-0620-10 Software Purchases Misc. Software 1-5045-0620-20 Software License Renewals 39,500Wonderware Premium Support PLC Programing Support Proworks32 & Unity SAGE WIN 911 Net DVR 1-5045-0730-30 Cabling & WAN Communcation Contuit Replacement/Wiring Replacement/WAN Com Calibration Supplies 1-5045-0710-78 Meters and Sensors 8,000Integral Manifolds for Flow & Pressure Meters Level Indicators Flow Meters 1-5045-0640-00 Dues, Memberships & 1-5045-0640-00 Dues, Memberships & Intenational Society of Automation 1-5045-0710-00 Materials $15,650 1-5045-0710-60 Hardware Supplies Hardware Supplies 1-5045-0710-64 Electrical Supplies Electrical Supplies 1-5045-0710-72 Calibration Supplies 1-5045-0730-40 Radio Repairs and Servicing Radio Repairs & Servicing 1-5045-0730-45 PLC Hardware 16,900Power Supplies & Components M340 System/PLC's Module Replacements Terminal Blocks/Other Parts Signal Conditioners-Converters 1-5045-0730-62 Instrumentation Instrumentation 1-5045-0730-00 Maintenance $82,950 1-5045-0730-15 Flow Meter Calibration Flow Meter Calibration 1-5045-0730-20 Electrical General Electrical General 1-5045-0730-25 Electrical Motor Control Center Motor Control Center 1-5045-0730-55 Security & Gas Detectors Security & Gas Detectors 1-5045-0730-60 UPS & Back-up Power UPS & Back-up 24VDC Power Systems 1-5045-0730-61 Cooling A/C Servicing Cooling & A/C Service Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 68 Operation Budget Division Detail (FY 2015/16) SCADA Division. Continued Category Total Sub Acct Total Detail Amt 1,000 1,000 8,000 8,000 1,550 1,550 6,500 6,500 5,000 5,000 5,000 5,000 5,800 5,800 $300 300 300 10,500 11,000 10,000 2,400 1,400 500 $1,400 1,400 1,400 $248,200 1-5045-0750-00 Non-Capital Equipment $32,850 1-5045-0750-07 Notebooks Tablet 1-5045-0750-09 Networking Equipment Field Routers, Switches, FIber Device Servers, Mod 1-5045-0750-30 Tools & Equipment Tools & Equipment $31,500 1-5045-0780-20 Software Consulting 31,500PLC Program Cnversions to Unity 1-5045-0750-35 Security Security 1-5045-0750-55 PLCs & Panels PLCs & Panels 1-5045-0750-65 Electrical Upgrades Electrical Upgrades Primary GL Category Sub Acct No./Sub Cate gory Detail Item Description 1-5045-0830-00 Travel & Conferences 1-5045-0830-00 Travel & Conferences AWWA Conference Section Total SCADA System Programing Maintenance PLC - SCADA Modifications 1-5045-0810-00 Professional Development $4,300 1-5045-0810-00 Professional Development 4,300Wonderware Training PLC Programing Training AWWA Training 1-5045-0750-70 Redundant SCADA Radio Systems Communications & Tower 1-5045-0760-00 Office Expense 1-5045-0760-30 Books & Publications Manuals/Books/Magazines 1-5045-0780-00 Professional Services Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 69 Operation Budget Division Detail (FY 2015/16) Mechanical Services Division Category TotalSub Acct Total Detail Amt 30,00030,000 350350 600600 3,0003,000 3,0003,000 500500 400400 8,0008,000 $30,000 30,00030,000 $150 150150 Primary GL CategorySub Acct No./Sub CategoryDetail Item Description 1‐5050‐0645‐00 Fees & Permits $30,950 1‐5050‐0645‐05 AQMD Permits AQMD Permits 1‐5050‐0645‐15 E.P.A.. Fees E.P.A. Fees 1‐5050‐0645‐60 CARB Fees C.A.R.B Fee 1‐5050‐0710‐00 Materials $6,500 1‐5050‐0710‐60 Hardware Supplies Hardware Supplies 1‐5050‐0710‐80 Mech. Shop Supplies Mech. Shop Supplies 1‐5050‐0710‐81 Welding Supplies Welding Supplies 1‐5050‐0750‐00 Non‐Capital Equipment $8,400 1‐5050‐0750‐08 Printers Replacement Printer/Scanner 1‐5050‐0750‐40 Mech Shop Eq uip ment Misc Mech Shop Equipment/Tools 1‐5050‐0780‐00 Professional Services 1‐5050‐0780‐00 Professional Services AQMD Compliance Consultant 1‐5050‐0810‐00 Professional Development 1‐5050‐0810‐40 Certificate Reimbursement Certificate Reimbursment Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 70 Operation Budget Division Detail (FY 2015/16) Mechanical Services Division, Continued Category TotalSub Acct Total Detail Amt 12,13312,133 1,0001,000 9,8009,800 4,0004,000 6,9006,900 2,0002,000 60,00060,000 5,0005,000 53,00053,000 20,10020,100 3,0003,000 500500 12,00012,000 2,0002,000 3,6003,600 1,0001,000 1,0001,000 1,5001,500 1,0001,000 1,4001,400 100,000100,000 20,00020,000 2,0002,000 $398,933 1‐5050‐0890‐30 Engineering ‐ Gas Engineering ‐ Gas 1‐5050‐0890‐31 Engineering ‐ Vehicle Engineering ‐ Vehicle Maint 1‐5050‐0890‐42 OPS ‐ Water ‐ Vehicle OPS Water Vehicle Maintenance 1‐5050‐0890‐43 OPS ‐ Water ‐ Eq uip ement OPS ‐ Water Equipment Maintenance 1‐5050‐0890‐44 OPS ‐ Water ‐ Gas OPS ‐ Water ‐ Gas 1‐5050‐0890‐45 OPS ‐ Water ‐ Diesel OPS ‐ Water ‐ Diesel 1‐5050‐0890‐54 OPS ‐ Mech Svcs ‐ Gas OPS ‐ Mech Svcs ‐ Gas 1‐5050‐0890‐55 OPS ‐ Facilities ‐ Vehicle OPS ‐ Facilities ‐ Vehicle Maint 1‐5050‐0890‐50 OPS ‐ Production Vehicle OPS ‐ Production Vehicle Maint 1‐5050‐0890‐51 OPS ‐ Production OPS ‐ Production Equipment Maint 1‐5050‐0890‐52 OPS ‐ Production ‐ Gas OPS ‐ Production ‐ Gas Section Total 1‐5050‐0890‐00 Vehicle Expenses $322,933 1‐5050‐0890‐10 Admin ‐ Gas Enforcement 1‐5050‐0890‐11 Admin ‐ Vehicle Maint Enforcement 1‐5050‐0890‐20 Finance ‐ Gas Finance ‐ Gas 1‐5050‐0890‐21 Fi nance ‐ Vehicle Maint Finance ‐ Vehicle Maint 1‐5050‐0890‐71 IT ‐ Gas IT ‐ Gas 1‐5050‐0890‐80 Stationary Engine Maint Primary GL CategorySub Acct No./Sub CategoryDetail Item Description 1‐5050‐0890‐90 Hazardous Materials Haz Mat Disposal Stationary Engine Maint 1‐5050‐0890‐81 Stationary Engine Stationary Engine Emissions Testing 1‐5050‐0890‐56 OPS ‐ Facilities ‐ Gas OPS ‐ Facilities ‐ Gas 1‐5050‐0890‐57 OPS ‐ Tool Repair OPS ‐ Tool Repair 1‐5050‐0890‐70 IT ‐ Vehicle Maint IT ‐ Vehicle Maintenance 1‐5050‐0890‐53 OPS ‐ Mech Svcs ‐ Vehicle OPS Mech Svcs ‐ Vehicle Maint Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 71 Operation Budget Division Detail (FY 2015/16) Facilities Maintenance Division Category Total Sub Acct Total Detail Amt 25,000 25,000 7,000 7,000 60,000 60,000 80,000 80,000 3,500 3,500 $2,000 2,000 2,000 4,000 4,000 1,800 1,800 1,500 1,500 5,000 5,000 10,000 10,500 6,000 6,000 2,000 2,000 10,000 10,000 10,000 10,000 15,000 15,000 $2,000 2,000 2,000 $90,000 90,000 90,000 $335,300 1-5060-0870-00 Utilities 1-5060-0870-10 Electric Electric Section Total 1-5060-0730-66 Asphalt Paving Asphalt Paving 1-5060-0730-67 Concrete Repair Concrete Repair 1-5060-0750-00 Non-Capital Equipment 1-5060-0750-30 Tools & Equipment Tools & Equipment 1-5060-0730-00 Maintenance $53,000 1-5060-0730-00 Maintenance Misc Facility Maint (Doors, fences, etc.) 1-5060-0730-20 Electrical General Electrical Repair Work 1-5060-0730-35 Fire Extinguisher Fire Extinguisher Maint/Calibration 1-5060-0730-50 Painting & Fencing 1-5060-0645-35 Haz Mat Fees (OCFA) Haz Mat Fees (OCFA), Permits Painting & Fence Repair 1-5060-0710-00 Materials $12,300 1-5060-0710-10 Building Repair Parts Building Repair Parts 1-5060-0710-60 Hardware Supplies Hardware Supplies 1-5060-0710-85 Cleaning/Painting Supplies Cleaning /Painting Supplies 1-5060-0710-98 Landscape Supplies Landscape Supplies 1-5060-0645-00 Fees & Permits 1-5060-0600-00 Contractual Services $175,500 1-5060-0600-05 AC & Heating AC & Heating 1-5060-0600-29 Disposal Service Disposal Service 1-5060-0600-35 Janitorial Service Janitorial Service 1-5060-0600-40 Landscape Service Landscape Service 1-5060-0600-45 Pest Control Service Pest Control Service Primary GL Category Sub Acct No./Sub Category Detail Item Description Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 72 Appendix Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 73 List of Acronyms AAR – After Action Report ACP- Asbestos Cement Pipe ACWA- Association of California Water Agencies ACWA/JPIA- ACWA’s Joint Powers Insurance Authority AF (af) - Acre Foot (1af = 325,851 gallons) AFY- Acre Feet per Year (rate of flow) AMP- Asset Management Plan AMS- Angle Meter Stop (Service shut off valve before the meter) AQMD- Air Quality Management District ASCE- American Society of Civil Engineers AWWA- American Water Works Association BEA- Basin Equity Assessment BMP- Best Management Practices BPP- Basin Production Percentage BPS- Booster Pump Station Brown Act- “Ralph M. Brown Act” enacted by the State Legislature governing all meetings of legislative bodies of local agencies CAFR- Comprehensive Annual Financial Report CALFED- The California and Federal Bay Delta Program. Addresses water management issues associated with the Bay Delta System CCR- Consumer Confidence Report ccf- 100 cubic feet (volume equal to approximately 748 gallons of water). Also used as one billing unit. Can also be known as “hcf” CDPH- California State Department of Public Health CEQA- California Environmental Quality Act CERCLA- Comprehensive Environmental Response, Compensation and Liability Act cf- cubic feet (volume equal to 7.48 gallons of water) CFR- Code of Federal Regulations cfs- cubic feet per second (rate of flow) CIP – Capital Improvement Project CIWQS- California Integrated Water Quality Systems COG – Continuity of Government COOP – Continuity of Operations COP – Critical Infrastructure Protection CORPs- United States Army Corps of Engineers CRWUA- Colorado River Water Users Association CSMFO- California Society of Municipal Finance Officers CUWA- California Urban Water Agencies CUWCC- California Urban Water Conservation Council CWEA- California Water Environment Association DIP- Ductile Iron Pipe DO- Dissolved Oxygen DWR- Department of Water Resources (State) Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 74 EMAC – Emergency Management Assistance Compact EOC – Emergency Operations Center EOP – Emergency Operations Plan ERP – Emergency Response Plan EPA- Environmental Protection Agency (Federal) ET- Evapotranspiration Rate (rate water evaporates off plants) ETOR- Employee Time Off Request ETWD- El Toro Water District FEMA- Federal Emergency Management Agency FOG- Fats Oils & Grease Program FTE- Full-Time Equivalent (number of employees) GFOA- Government Finance Officers Association GIS- Geographic Information System GPC- Gallons per Capita GPCD- Gallons per Capita per Day GPM- Gallons per Minute GPS- Global Positioning System GSWC- Golden State Water Company GW- Groundwater GWRS- Groundwater Replenishment System (OCWD Water Treatment System) HP- Horsepower (unit of mechanical energy) IC – Incident Commander ICS – Incident Command System IRWD- Irvine Ranch Water District IW- Import Water KW- Kilowatt (unit of electrical energy) KWh- Kilowatt-hour (rate of energy use or delivery) LBCWD- Laguna Beach County Water District MCL- Maximum Contaminant Level MCWD- Mesa Consolidated Water District Met- Metropolitan Water District of Southern California (aka MWD) MG- Million Gallons mg/l- Milligrams per liter (unit of concentration equivalent to ppm) MGD- Million Gallons per Day MNWD- Moulton Niguel Water District MOA – Memorandum of Agreement MOU – Memorandum of Understanding MWD- Metropolitan Water District of Southern California (aka Met) MWDOC- Municipal Water District of Orange County NIMS – National Incident Management System NPDES- National Pollutant Discharge Elimination Systems NRP – National Response Plan NWS- National Weather Service OA – Operational Area OCSD- Orange County Sanitation District Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 75 OCWD- Orange County Water District PIP- Performance Improvement Plan ppb- parts per billion ppm- parts per million ppt- parts per trillion PRS- Pressure Reducing Station (multiple PRV’s usually in a vault) PRV- Pressure Reducing Valve REOC – Regional Emergency Operations Center RFP – Request for Proposal RO- Reverse Osmosis (treatment) RWQCB- Regional Water Quality Control Board (State) S. A.- Seasonally Adjusted SAR – Santa Ana River SCADA- Supervisory Control and Data Acquisition system SCWD- South Coast Water District SDWA- Safe Drinking Water Act (Federal) SEMS – Standardized Emergency Management System SMWD- Santa Margarita Water District SOC – State Operations Center SOP – Standard Operating Procedure SSMP-Sewer System Management Plans SSO- Sanitary Sewer Overflow SWP- State Water Project TCWD- Trabuco Canyon Water District tds- Total Dissolved Solids ug/l- Micrograms per liter (unit of concentration equivalent to ppb) USGS- United States Geological Survey (Federal) UV- Ultra-Violet Light Radiation (water treatment) UWMP- Urban Water Management Plan VCP- Vitrified Clay Pipe (sewer pipe) WDR- Waste Discharge Requirements (State) WEF- Water Environment Federation (counterpart to AWWA for the wastewater industry) WTP- Water Treatment Plant Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 76 Glossary of Terms Accrual Basis of Accounting: The basis of accounting under which transactions are recognized when they occur, regardless of the timing of cash receipts and disbursements. Acre-Foot: The volume of water that will cover one acre to a depth of one foot. One acre equals 435.6 units or 325,850 gallons. Appropriation: A funding authorization made by the Board, which permits the District to incur obligations and to make expenditures of resources. Assets: Resources owned or held by the District that have monetary value Balanced Budget: Budgeted revenues are sufficient to cover all budgeted expenditures, principle payments on long-term debt, and minimum funding of all reserve requirements as required by the District’s reserve policy. Bond: A written promise to pay a sum of money on a specific date or dates at a specified interest rate. The interest payments and the repayment of the principal are authorized in a District bond resolution. Common types of bonds are General Obligation (GO) bonds and Certificates of Participation (COPs). These are frequently used for construction of large capital projects such as buildings, reservoirs, pipelines and pump stations. California Society of Municipal Finance Officers (CSMFO): A statewide organization servicing all California municipal finance professionals whose purpose is to promote excellence in financial management through innovation, continuing education and the professional development of its members. Capital Budget: The portion of the annual budget that appropriates funds for the purchase of capital equipment items and capital improvements. These expenditures are separated from regular operating items, such as salaries and office supplies. Capital Equipment: Fixed assets such as vehicles, computers, furniture, technical instruments, equipment, etc. which have a life expectancy of more than 2 years and a value of greater than $5,000. Capital Expenditures: Expenditure on an item that meets the meets the District’s $5,000 threshold for capitalization. Also referred to in the Budget as Vehicle and Equipment (See Capital Equipment) Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 77 Capital Improvement: Expenses related to the construction, rehabilitation and modernization of District owned and operated infrastructure. Capital Replacement: Expenses related to major replacements of existing facilities or systems. Certificates of Participation (COP): A long-term debt instrument authorized for construction or acquisition of facilities and equipment. Debt: An obligation resulting from the borrowing of money or from the purchase of goods and services. These include bonds and accounts payables. Debt Service: The District’s obligation to pay the principal and interest of bonds and other debt instruments according to a predetermined payment schedule. Deferred Revenue: Revenue that is not recognized in the period in which received because they are not “available” until a subsequent period. Depreciation: An expense recorded to allocate a tangible asset’s cost over its useful life. Designated: A term that describes assets or equity set aside by action of the Board; as distinguished from assets or equity set aside in conformity with requirements of donors, grantors, or creditors. Enterprise Fund: Fund established to account for the financing of self-supporting enterprises, such as a utility fund, which render services primarily to the public. Expenditures/Expenses: A charge incurred, whether paid or unpaid, for operation, maintenance, interest, and other charges presumed to benefit the current fiscal period. Fiscal Year: A 12-month period of time to which the annual budget applies and at the end of which a government determines its financial position and the results of its operations. The District has specified July 1 to June 30 as its fiscal year. Fund Balance/Fund Equity: See “Net Assets” Geographic Information System (GIS): A system combining computer hardware, software, and geographic data for collecting, storing, analyzing and displaying geographically referenced information. Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 78 Generally Accepted Accounting Principles (GAAP): Accounting and financial reporting standards, conventions, and practices that have authoritative support from standards-setting bodies such as the Governmental Accounting Standards Board (GASB) and the Financial Accounting Standards Board.(FASB). Governmental Account Standards Board (GASB): National advisory board of accounting standards for public agencies. The Board identifies procedures, methods and standards for presenting the financial condition of public agencies. Government Finance Officers Association (GFOA): National organization whose purpose is to enhance and promote the professional management of governments for the public benefit by identifying and developing financial policies and best practices and promoting their use through education, training, facilitation of member networking, and leadership. Groundwater Replenishment Assessment: An assessment paid to Orange County Water District (OCWD) based upon the number of acre-feet of groundwater produced by the District. Infrastructure: The accumulated pipelines and storage facilities of the District, including meters, valves, pumps, filters and other appurtenances, whether constructed by the District or dedicated by private entities. Interest Income: Earnings from the investment portfolio. Liabilities: Present obligations of the District arising from past events. Locke Ranch Assessment: Charges for the Locke Ranch sewer system, which was transferred to the District in 1977. The assessment is imposed pursuant to authority in Water Code Section 31101.5 and adopted in accordance with the requirements of law. The current assessment is $66.00 per year for a residential or equivalent sewer connection and is collected on the Orange County tax roll. Net Assets: The difference between total assets and total liabilities. Increases or decreases in net assets may serve as a useful indicator of whether the financial position of the District is strengthening or weakening. Non-Capital Equipment: Hand tools, furniture and equipment costing $5,000 or less. Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 79 Operating Budget: The portion of the budget that pertains to daily operations that provide basic district services. The operating budget contains appropriations for such expenditures as personnel, supplies, utilities, materials, travel and fuel, and does not include purchases of major capital plant or equipment which is budgeted separately in the Capital Budget. Operating Expenses: All costs associated with the day-to-day business of the District, which are not considered capital improvements or debt repayments. Purchased Import Water: All imported water obtained from Metropolitan Water District of Southern California (MWD) through the Municipal Water District of Orange County (MWDOC). QualServe: A voluntary quality improvement program designed exclusively for water and wastewater agencies. Refunding Revenue Bond: A revenue bond is a long-term municipal debt instrument that is secured by a specified revenue source. A refunding revenue bond is a revenue bond that retires another bond before the first bond matures. Reserve Fund: The District maintains Reserve Funds per the District’s policy for both designated and restricted balances. Designated Reserve Funds are “general use” funds designated by the Board. Restricted Reserve Funds are those that are legally set aside for a particular purpose due to a legal or contractual commitment and cannot be used for any other purpose. Revenue: Monies that the District receives as income. It includes such items as water sales and sewer fees. Estimated revenues are those expected to be collected during the fiscal year. Supervisory Control and Data Acquisition (SCADA): The system that collects operational data from remote units to monitor and control water and wastewater systems and facilities throughout the District service area. Sewer Fund: The fund established to account for the District’s activities of wastewater collection and distribution to Orange County Sanitation District for treatment. Special District: An independent unit of local government organized to perform a single governmental function or a restricted number of related functions. Yorba Linda Water District is organized as a special district. Supplies and Services: The cost of items needed to support the accomplishment of the activities in a department’s programs. Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 80 Uncollectible Accounts: Includes the write-off of unpaid water and sewer charges. User Charge: A charge levied against users of a service or purchasers of a product. Variable Water Costs: Water costs based on a set price per unit but that varies on the quantity of units bought or produced. Variable water costs for the District are related to the quantity of import water that the District purchases and the quantity of ground water pumped from the wells. Vehicle and Equipment Outlay: Purchases of assets, such as vehicles, equipment and furniture, which cost over $5,000 each and are depreciated over their useful life. Water Fund: The fund established to account for the District’s activities relating to the treatment and distribution of potable drinking water and non-potable water to its customers. Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 81 Financial Policies Introduction The District’s financial policy documents incorporate many of the District’s financial management practices that are used by the District staff as guidelines for operational and strategic decision-making related to current and future financial matters. The purpose of establishing these policies is to identify acceptable and unacceptable courses of action, thus establishing parameters in which the District’s fiscal performance can be reviewed. Some policies are flexible when they are utilized by District staff as performance measurement tools to monitor the District’s finances, while others are restrictive to emphasize accountability. The Operating Budget Policy and Revenues and Expenditures Policy are internal documents, acting as a guideline for staff, and are not reviewed by the Board. The Financial Reserves Policy and Investment Policy are reviewed by District staff and Board Members annually, to accommodate minor changes to the existing policy or major shifts in financial priorities as approved by the District’s Board of Directors. The District’s financial policies encompass the following functional areas:  Operating Budget Policy  Revenues and Expenditures Policy  Financial Reserves Policy  Investment Policy Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 82 Operating Budget Policy The operating budget policy answers some basic questions such as: How is the budget developed? Who is involved in the budget process? What does the budget include? Budget Development The District’s budget is developed in accordance with the priorities which are linked to the District’s financial and strategic plans set forth in the District’s mission and long-term goals and objectives. These are found in the District’s strategic plan, the needs of the community, and federal and state laws. Guidelines with respect to the District’s budget are as follows:  The budget should support the District’s mission statement, strategic goals, and critical priorities  There should be no deferment of critical maintenance  The budget should be regarded as a business operating plan  The budget should balance the needs to pay for the District’s cost of providing services, debt service obligation and capital needs of the District  Expenses should be budgeted for in appropriate departments to correctly identify the cost of providing various District functions and services Budget Form The District operating and capital budget is developed on an annual basis. Operating and capital appropriations are approved by the District’s Board of Director’s. Proposed revenues and expenditures including debt service expenditures are presented to the Board of Directors along with comparisons to projected expenditures for the current year and actual expenditures of the prior two years. Basis of Budgeting The accounting for the District is kept on an accrual basis. Revenues are recognized when earned, and expenses are recognized when incurred. The budgeting for the District is kept on an accrual basis, with the exception of supplies & services, which are budgeted on a cash basis. The District is operated as an enterprise fund, which is an accounting entity that finances and accounts for the acquisition, operation and maintenance of governmental facilities and services. It is the District’s intention to recover the full costs of supplying goods and/or services through user-charges. Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 83 The District’s budget process was developed with a series of goals and objectives in mind. These goals and objectives are communicated throughout the organization through several meetings. During the process, the Board of Directors provides priorities and guidelines to the General Manager. The General Manager then discusses Board priorities and other future issues and concerns with Department Heads during staff meetings. Once goals and objectives for the upcoming year are identified, the General Manager and the District staff start developing the District’s budget. Where practical, the District integrates performance measurement, service level, and productivity indicators in the District’s adopted budget document. The District will continue to emphasize the importance of meeting each department’s goals and objectives in order to accomplish its long-term goals and objectives. An increase in the Operating and Capital budget may result in water rate increases. In order to minimize the impact on the District’s rates, revenue requirements are scrutinized to achieve operating efficiencies and maintain or increase customer service at the same time. As part of the cost containment efforts, District staff re-visits operating priorities and reviews internal procedures to included utilizing outside services when they can offer greater competitive advantages to doing it internally, or investing in technology to increase productivity and to reduce the need for additional staff. Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 84 Revenues and Expenditures Policies This policy is used as an aid to provide for the consistent provision of essential public services since revenues and expenditures are the key drivers of the District’s operations. The goal of this policy is to help ensure the financial stability regardless of the economic situation and to provide information to the Board that revenue and expenditure practices are consistent with the District’s mission and goals. Revenues Policy Budgeted revenues are estimated conservatively using an objective and analytical approach using certain techniques such as historical trends and current information to maintain consistency, reliability, and reasonableness. User Charges User charges are the most important component of the District’s revenue portfolio. The District uses user charges to fund the provision of services provided to its customers. The District utilizes a cost recovery component to determine how much costs need be recovered from various customers. The cost of providing various services is used as the basis for setting rates and fees to the various types of customers served. The following are guidelines for the user charge setting process:  User charges are established utilizing a generally accepted cost recovery methodology that is consistent and legally defendable using the following approaches: revenue requirement analysis, cost of service analysis, and rate design analysis.  Rate designs shall be reflective of the District’s Board of Directors’ rate setting objectives.  Rates shall be set at a level so that the District will collect reliable revenues through a combination of system access charges and users’ commodity rates to pay for the District’s revenue requirement.  Rates and charges will be reviewed and updated regularly based on factors such as the impact of inflation, other cost increases, the adequacy of the coverage of costs and requirements of the rate covenant. Expenditures Policy The District’s expenditures reflect the Board of Directors’ and staff commitment to serve present and future customers with reliable public services. The Board and Staff believe that prudent expenditure planning and accountability will ensure fiscal stability. Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 85 Budgeted expenditures are projected conservatively using an objective and analytical approach as well as certain techniques such as historical trends, current information, and economic indicators to maintain consistency, reliability, and reasonableness. The basic components of the District’s expenditure policies are broken down into two functional areas: Maintenance of Capital Assets and Review of Service Maintenance of Capital Assets Maintaining a reliable transmission and distribution system and a sustained capital program are simply not possible without reliable funding sources. For this reason, prudent financial planning is imperative to an effective capital improvement program. The District uses a combination of “pay as you go” method and long term funding to fund the District’s capital improvement program and maintenance of its capital assets. A fixed annual amount was projected by an Asset Management Plan and is included in the District’s Reserve Policy as an annual revenue requirement to be collected from rates and charges. The annual contributions then are accumulated and kept in the District’s capital fund to be spent and withdrawn for the District’s betterment and replacement projects over a period of time. The following elements of expenditure policy reflect the District’s philosophy to perform ongoing maintenance of capital investments once they are purchased and capitalized:  Maintain consistency of allocation of resources for programs to carry out the District’s mission and goals to its customers  Within the resources available each fiscal year, the District shall maintain capital assets and infrastructure at a satisfactory level to protect the District’s investment, to minimize the future replacement and maintenance costs, and to continue service levels. Review of Service These expenditure policies are used by staff to prompt review of services to see if they are being provided as effectively and efficiently as possible. The District’s review of service policy is as follows:  Utilize technology and productivity advancements that will help reduce or avoid increasing personnel costs, when practicable.  Control personnel costs as a proportion of total budget, to more productively and creatively use available resources. Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 86 Financial Reserves Policy A. GENERAL POLICY: Maintaining adequate reserves is an essential part of sound financial management. The Yorba Linda Water District Board of Directors realizes the importance of reserves in providing reliable service to its customers, financing of long-term capital projects and funding availability for emergencies should the need arise. Interest derived from reserve balances shall be credited to the reserve account from which it was earned. B. CATEGORIES: YLWD shall accumulate, maintain and segregate its reserve funds into the following categories: Restricted and Designated Reserves 1. Board Designated Reserves; and 2. Contractually Restricted Reserves. C. SCOPE: This policy will assist the Board of Directors in establishing: 1. Target levels for reserve funds; 2. Requirements for the use of reserve funds; and 3. Periodic review requirements for each reserve. D. PERIODIC REVIEW: Staff and the YLWD Board shall review the reserve balances and targets annually as a part of the annual budget process. The Finance-Accounting Committee will continue to review all reserve and investment balances monthly, with a quarterly report going to the full Board. E. RESTRICTED AND DESIGNATED RESERVES: 1. Board Designated Reserves: These are reserve funds earmarked for the purpose of funding such items as new capital facilities, repair or replacement of existing facilities and general operating reserves designated for a specific purpose and use by the Board of Directors. Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 87 1.0 Operating Reserve A. Definition and Purpose – Established to cover temporary cash flow deficiencies that occur as a result of timing differences between the receipt of operating revenue and expenditure requirements and unexpected expenditures occurring as a result of doing business. B. Target Level – The Government Finance Officers Association (GFOA) recommends that funding should be no less than one to two months (or 8% - 17%) of the District’s annual operating budget. The District’s current target will be a minimum of 8% and a maximum of 17% of the annual operating budget for both the water and sewer funds. C. Events or Conditions Prompting the Use of the Operating Reserve – This reserve may be utilized as needed to pay outstanding operating expenditures prior to the receipt of anticipated operating revenues. 1.1 Emergency Reserve A. Definition and Purpose – Established to provide protection recovery to the District and its customers for losses arising from an unplanned event or circumstance. The reserve level combined with YLWD’s existing insurance policies should adequately protect YLWD and its customers in the event of a loss. B. Target Level – Established at a minimum level equal to $1,000,000 for the water fund and shall accumulate interest and annual contributions as determined by the District’s annual operation to a maximum level of $4,000,000. The target for sewer will be a minimum of $250,000 and a maximum of $1,000,000. C. Events or Conditions Prompting the Use of the Emergency Reserve – This reserve shall be utilized to cover unexpected losses experienced by the District as a result of a disaster or other unexpected loss. Any reimbursement received by the District from insurance companies as a result of a submitted claim shall be deposited back into the reserve as replenishment for the loss. Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 88 1.2 Capital Replacement Reserve A. Definition and Purpose – Established to provide capital repair and replacement funding as the District’s infrastructure deteriorates over its expected useful life. B. Target Level – The Board-approved 2010 Asset Management Plan recommended that the annual contribution to this reserve be at a minimum level of $1,820,000 for the water fund and $345,000 for the sewer fund, less money set aside for the Maintenance Reserve. Funding with available funds based on the District’s operations shall be allocated quarterly. C. Events or Conditions Prompting the Use of the Capital Replacement Reserve – Through the annual budget process, staff shall recommend anticipated asset replacement projects. The Board of Directors shall take action to approve recommended project appropriations from the capital replacement reserve. Should unplanned replacement be necessary during any fiscal year, the Board of Directors may take action to amend the budget and appropriate needed funds as required. 1.3 Maintenance Reserve A. Definition and Purpose – Established to provide funding for non-scheduled capital asset repair and replacement. B. Target Level – $200,000 subject to an annual review. C. Events or Conditions Prompting the Use of the Maintenance Replacement Reserve – Unplanned failure of assets including but not limited to pumps, motors and major facility repairs. 1.4 Debt Service Reserve A. Definition and Purpose – Established to provide funding for semi-annually scheduled debt service payments. B. Target Level – The District’s highest annual debt service payment – currently $2,723,509. C. Events or Conditions Prompting the Use of the Debt Service Reserve – Semi- annual debt service payments will be made out of this fund, with funding on the water rate replenishing the fund annually. Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 89 1.5 Employee Liabilities Reserve A. Definition and Purpose – The purpose is to cover employees’ accrued vacation and other compensatory time and to ensure the complete funding associated with the liability incurred for employees whom have met the requirements necessary for district paid health benefits at retirement. B. Target Level – The annual contribution will be $100,000 ($93,000 for water and $7,000 for sewer) to be evaluated and/or adjusted annually thereafter based on an analysis of current employees’ vacation and sick time accrued and actuarial determinations of future retiree costs. As of November 2, 2011, an actuary determined that the District’s Other Post Employment Benefit (OPEB) liability was $1,433,197. When combined with a liability on the District’s books for vacation, compensatory and sick time of $1,063,572 at June 30, 2012, the target is projected to be approximately $2,500,000 for the combined water and sewer enterprises. C. Events or Conditions Prompting the Use of the Employee Liabilities Reserve – This reserve may be used in the event that operating funds are not adequate to meet vacation, compensatory and sick time paid out or retiree medical cost obligations within the current year. 2. Contractually Restricted Reserves: These are funds held to satisfy limitations set by external requirements established by creditors, grant agencies or law. Examples include stipulated bond covenants and reserves held with a fiscal agent. 2.0 US Bank 2008 COP Reserve A. Definition and Purpose – Established to cover reserve requirements held with a designated fiscal agent (US Bank) for the 2008 Certificates of Participation. B. Target Level – Funding shall be held in an amount equal to $2,147,096. C. Events or Conditions Prompting the Use of the Contractually Restricted Reserve – This reserve may be utilized as needed by the fiscal agent to pay any outstanding debt service payments not covered by the District within the specified billing and due dates. Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 90 C. SCOPE: This policy will assist the Board of Directors in establishing: 4. Target levels for reserve funds; 5. Requirements for the use of reserve funds; and 6. Periodic review requirements for each reserve. D. PERIODIC REVIEW: Staff and the YLWD Board shall review the reserve balances and targets annually as a part of the annual budget process. The Finance-Accounting Committee will continue to review all reserve and investment balances monthly, with a quarterly report going to the full Board. E. RESTRICTED AND DESIGNATED RESERVES: 1. Board Designated Reserves: These are reserve funds earmarked for the purpose of funding such items as new capital facilities, repair or replacement of existing facilities and general operating reserves designated for a specific purpose and use by the Board of Directors. Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 91 Investment Policy SECTION 1: GENERAL POLICY 1.1 It is the policy of the Yorba Linda Water District (“District”) to invest public funds in a manner which ensures the safety and preservation of capital while meeting reasonably anticipated operating expenditure needs, achieving a reasonable rate of return and conforming to all state and local statutes governing the investment of public funds. 1.2 The purpose of this policy is to provide guidelines for the prudent investment of funds of the District and to outline the policies for maximizing the efficiency of the District’s cash management. The District’s goal is to enhance the economic status of the District consistent with the prudent protection of the District’s investments. This investment policy has been prepared in conformance with all pertinent existing laws of the State of California. SECTION 2: SCOPE 2.1 This Investment Policy applies to all funds and investment activities of the District, except for the proceeds from capital project financing instruments, which are invested in accordance with provisions of their specific documents. These funds are accounted for as Enterprise Funds and are identified in the District’s Comprehensive Annual Financial Report. SECTION 3: DELEGATION OF AUTHORITY 3.1 The authority of the Board of Directors to invest funds is derived from Section 53601 of the California Government Code (“CGC”). Section 53607 of the CGC grants the Board of Directors the authority to delegate that authority, for a one- year period, to the District’s Treasurer. Therefore, management responsibility for the investment program is hereby delegated to the District’s Treasurer, who shall be responsible for all transactions undertaken and shall establish a system of controls to regulate the activities of subordinate officials and their procedures in the absence of the Treasurer. The Treasurer shall establish procedures for the management of investment activities, including the activities of staff consistent with this Policy. Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 92 3.2 The Treasurer may retain the services of an outside investment advisor or manager as approved by the Board to assist with the District’s investment program. Any investment advisor selected shall make all investment decisions and transactions in strict accordance with State law, and this Policy. SECTION 4: INVESTMENT OBJECTIVES 4.1 The primary objectives, in priority order, of the District’s investment activities shall be: 4.1.1 Safety: Safety and preservation of principal is the foremost objective of the investment program. Investments shall be selected in a manner that seeks to ensure the preservation of capital in the District’s overall portfolio. This will be accomplished through a program of diversification and maturity limitations, more fully described in Section 13, in order that potential losses on individual securities do not exceed the income generated from the remainder of the portfolio. 4.1.2 Liquidity: The District’s investment portfolio will remain sufficiently liquid to enable the District to meet all operating requirements which might be reasonably anticipated. Securities should mature concurrent with cash needs to meet anticipated demands. 4.1.3 Return on Investments: The District’s investment portfolio shall be designed with the objective of attaining the best yield or returns on investments, taking into account the investment risk constraints and liquidity needs. Return on investment is of secondary importance compared to the safety and liquidity objectives. SECTION 5: PRUDENCE 5.1 The standard of prudence to be used by the designated representative shall be the “prudent investor” standard and shall be applied in the context of managing the overall portfolio. The meaning of the standard of prudent investor is explained in CGC Section 53600.3, which states that “when investing, reinvesting, purchasing, acquiring, exchanging, selling or managing public funds, a trustee shall act with care, skill, prudence, and diligence under the circumstances then prevailing, including, but not limited to, the general economic conditions and the anticipated needs of the agency, that a prudent person acting in a like capacity and familiarity with those matters would use in the conduct of Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 93 funds of a like character and with like aims, to safeguard the principal and maintain the liquidity needs of the agency.” 5.2 The Treasurer and delegated investment officers, acting in accordance with District procedures and the Policy and exercising due diligence, shall be relieved of personal responsibility for an individual security’s credit risk or market price changes, provided deviations from expectations are reported in a timely fashion and appropriate action is taken to control adverse developments. 5.3 Investments shall be made with judgment and care - under circumstances then prevailing - which persons of prudence, discretion and intelligence exercise in the management of their own affairs, not for speculation, but for investment, considering the probable safety of their capital as well as the probable income to be derived. SECTION 6.0: ETHICS AND CONFLICTS OF INTEREST 6.1 Officers and employees involved in the investment process shall refrain from personal business activity that could conflict with proper execution of the investment program, or which could impair their ability to make impartial investment decisions. Employees and investment officials shall disclose to the District’s General Manager any material financial interests in financial institutions that conduct business with the District’s boundaries, and they shall further disclose any large personal financial/investment positions that could be related to the performance of the District. SECTION 7: AUTHORIZED BROKER/DEALERS 7.1 The Treasurer will maintain a list of authorized broker/dealers and financial institutions that are approved for investment purposes. Broker/dealers will be selected for credit worthiness and must be authorized to provide investment services in the State of California. These may include “primary” dealers or regional dealers that qualify under Securities & Exchange Commission Rule 15(C)3-1 (uniform net capital rule). No public deposit will be made by the broker/dealer except in a qualified public depository as established by the established state laws. Before a financial institution or broker/dealer is used, they are subject to investigation and approval by the Treasurer or his/her designated representative, and must submit the following: 7.1.1 Certification of having read and understood this investment policy resolution and agreeing to comply with the District’s investment policy; 7.1.2 Proof of Federal Investment Regulatory Authority certification; Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 94 7.1.3 Proof of State of California registration; 7.1.4 Audited financial statements for the institution’s three (3) most recent fiscal years; 7.1.5 References of other public-sector clients that similar services are provided to. 7.2 If a third party investment advisor is authorized to conduct investment transactions on the District’s behalf, the investment advisor may use their own list of approved independent broker/dealers and financial institutions. The investment advisor’s approved list must be made available to the District upon request. SECTION 8: AUTHORIZED INVESTMENTS 8.1 The District is provided a broad spectrum of eligible investments under the CGC Sections 53601 et seq. Authorized investments shall also include, in accordance with CGC section 16429.1 et seq., investments into the Local Agency Investment Fund (LAIF) and the Orange County Treasurer’s Commingled Investment Pool in accordance with CGC section 53684. Within the investments permitted by the CGC, the District seeks to further restrict eligible investment to the investments listed in Section 8.3 below. Percentage holding limits listed in this section apply at the time the security is purchased. Ratings, where shown, specify the minimum credit rating category required at purchased without regard to +/- or 1,2,3 modifiers, if any. 8.2 The purchase of any investment permitted by the CGC, but not listed as an authorized investment in this Policy is prohibited without the prior approval of the Board of Directors. 8.3 Within the context of these limitations, the following investments are authorized: Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 95 TABLE 1 Permitted Investments*/ Deposits CA Government Code % of Portfolio Limits / Maturity Limits YLWD % of Portfolio Limits / Maturity Limits Bank Deposits# No % limit, 5 years No % limit, 5 years CD Placement Service# 30% limit, 5 years 30% limit, 5 years Local Agency Investment Fund (LAIF)^ No % or maturity limit No % or maturity limit County Pooled Investment Funds^ No % or maturity limit No % or maturity limit Joint Powers Authority Funds (CalTRUST & CAMP)^ No % or maturity limit No % or maturity limit U.S. Treasury Obligations No % limit, 5 years No % limit, 5 years U.S. Agency Obligations No % limit, 5 years No % limit, 5 years Negotiable Certificates of Deposit# 30% portfolio, 5 years 30% portfolio, 5 years Money Market Funds* 20%, 10% per issuer, no limit 20%, 10% per issuer, no limit Medium-Term (or Corporate) Notes* 30% portfolio, 5 years 30% portfolio, 5 years Bankers Acceptances* 40%, 30% per issuer, 180 days 10% max, 5% per issuer, 180 days Commercial Paper* 25%, 10% per issuer, 270 days 25% max, 5% per issuer, 270 days * Please see Appendix A for more detailed descriptions and additional restrictions ^ Please see Section 10 for additional restrictions # Please see Section 11 for additional restrictions Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 96 SECTION 9: REVIEW OF INVESTMENT PORTFOLIO 9.1 The securities held by the District must be in compliance with Section 8 Authorized Investments at the time of purchase. The Treasurer shall at least quarterly review the portfolio to verify that all securities are in compliance with Section 8 Authorized Investments. In the event a security held by the District is subject to a credit rating change that brings it below the minimum credit ratings specified in Appendix A Authorized Investments, the Treasurer should notify the Finance-Accounting Committee - and through the Committee’s minutes, the Board - of the change. The course of action to be followed will then be decided on a case-by-case basis, considering such factors as the reason for the change, prognosis for recovery or further rate drops, and the market price of the security. SECTION 10: INVESTMENT POOLS 10.1 A thorough investigation of any investment pool or mutual fund is required prior to investing, and on a continual basis. The investigation will, at a minimum, obtain the following information: 10.1.1 A description of eligible investment securities, and a written statement of investment policy and objectives; 10.1.2 A description of interest calculations and how it is distributed, and how gains and losses are treated; 10.1.3 A description of how the securities are safeguarded (included the settlement processes), and how often the securities are priced and the program audited; 10.1.4 A description of who may invest in the program, how often and what size deposit and withdrawal are allowed; 10.1.5 A schedule for receiving statements and portfolio listings; 10.1.6 Are reserves, retained earnings, etc. utilized by the pool/fund; 10.1.7 A fee schedule and when and how it is assessed; 10.1.8 Is the pool/fund eligible for bond proceeds and/or will it accept such proceeds. Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 97 SECTION 11: COLLATERALIZATION 11.1 Bank Deposits: Under provisions of the CGC, California banks and savings and loan associations are required to secure the District’s deposits by pledging eligible securities with a value of 110% of principal and accrued interest. State law also allows financial institutions to secure District deposits by pledging first trust deed mortgage notes having a value of 150% of the District’s total deposits. 11.2 Waiver of Security: The Treasurer, at his/her discretion and in accordance with CGC section 53653, may waive security for the portion of any deposits as is insured pursuant to federal law. SECTION 12: SAFEKEEPING AND CUSTODY 12.1 All security transactions entered into by the District shall be conducted on a delivery-versus-payment basis. Securities will be held by a third party custodian designated by the Treasurer and evidenced by safekeeping receipts. The only exception to the foregoing shall be depository accounts and securities purchases made with (i) local government investment pools, and (ii) money market mutual funds, since those purchased securities are not deliverable. SECTION 13: DIVERSIFICATION AND MAXIMUM MATURITIES 13.1 The District will diversify its investments by security type and institution. With the exception of U.S. Treasuries, U.S. Agency Securities, FDIC Insured Certificates of Deposit and authorized pools, no more than 30% of the District’s total investment portfolio will be invested in a single security type or with a single financial institution. 13.2 To the extent possible, the District will attempt to match its investments with anticipated cash flow requirements. Unless matched to a specific cash flow and approved in advance by the Board of Directors, the District will not directly invest in securities maturing more than 5 years from the date of purchase. SECTION 14: INTERNAL CONTROLS 14.1 The external auditors will annually review the investments and general activities associated with the investment program. This review will provide internal control by assuring compliance with the Investment Policy and District policies and procedures. Material Distributed Less Than 72 Hours Prior to the Meeting ANNUAL OPERATING BUDGET FISCAL YEAR 2015/16 98 SECTION 15: PERFORMANCE STANDARDS 15.1 The investment portfolio will be designed with the objective of obtaining a rate of return throughout budgetary and economic cycles, commensurate with the investment risk constraints and the cash flow needs. 15.2 The District’s investment strategy is passive. The performance of the District’s investment portfolio will be evaluated and compared to an appropriate benchmark in order to assess the success of the investment portfolio relative to the District’s Safety, Liquidity and Return on Investments objectives. This review will be conducted annually with the Finance-Accounting Committee. SECTION 16: REPORTING 16.1 Subject to CGC sections 53607 and 53646(b), the Treasurer will provide monthly investment reports to the District’s Finance-Accounting Committee (and through the Committee’s minutes, to the Board of Directors) and quarterly reports to the Board of Directors which provide a clear picture of the status of the current investment portfolio. The reports shall comply with the reporting requirements of CGC sections 53607 and 53646(b), respectively. SECTION 17: INVESTMENT POLICY ADOPTION 17.1 The District’s Investment Policy will be adopted by resolution of the Board of Directors. The policy will be reviewed on an annual basis and modification, if any, must be approved by the Board of Directors. Material Distributed Less Than 72 Hours Prior to the Meeting ITEM NO. 8.2 AGENDA REPORT Meeting Date: July 9, 2015 Budgeted:Yes Total Budget:$5,000 for FY 2015/16 To:Board of Directors Cost Estimate:$5,000 for FY 2015/16 Funding Source:Water Operating Fund From:Marc Marcantonio, General Manager Account No:1-2020-0600-00 Presented By:Steve Conklin, Engineering Manager Dept:Administration Reviewed by Legal:Yes Prepared By:Cindy Botts, Water Conservation Supervisor CEQA Compliance:N/A Subject:Water Conservation Participation Agreement with Municipal Water District of Orange County (MWDOC) SUMMARY: The Municipal Water District of Orange County (MWDOC) administers multiple water conservation rebate programs that YLWD has participated in since 2004. Traditionally, each rebate program has been approved separately through individual agreements. This year, MWDOC has created an "umbrella" agreement that will allow agencies to more easily adjust their funding amounts. STAFF RECOMMENDATION: That the Board of Directors authorize the General Manager to execute MWDOC's Water Conservation Participation Agreement. DISCUSSION: YLWD's FY 2015/16 budget reflects a total of $5,000 for various rebate programs through MWDOC. As the $5,000 is a not-to-exceed amount, any funds not rebated will not be required to be spent. Under the new "umbrella" agreement, YLWD can choose which programs they wish to participate in and make adjustments to any not-to-exceed amounts through addendums, as necessary, rather than bringing the whole agreement back to the Board of Directors for approval. STRATEGIC PLAN: CP 2-A: Provide Financial Incentives and Rebates for Water Use Efficiency PRIOR RELEVANT BOARD ACTION(S): The Board has approved Participation Agreements with MWDOC for the Smart Timer and Rotating Nozzle and Turf Removal rebates. ATTACHMENTS: Name:Description:Type: UNSIGNED_YLWD_Water_Conservation_Participation_Agt_Final_6- 25-15.pdf Water Conservation Participation Agreement Backup Material Approved by the Board of Directors of the Yorba Linda Water District 7/9/2015 MB/PH 5-0 Page | 1 Water Conservation Participation Agreement between the Municipal Water District of Orange County and Yorba Linda Water District This Water Conservation Participation Agreement (“Agreement”) is made between the Municipal Water District of Orange County (“MWDOC”) and Yorba Linda Water District (“Participant Agency”). MWDOC and Participant Agency may be collectively referred to as “Parties” and individually as “Party.” Recitals A. The Metropolitan Water District of Southern California (“Metropolitan”) provides incentive funding to residential, commercial, and industrial water users in its service area for a variety of water conservation activities, including, but not limited to, rebates for the purchase and installation of water-saving devices (“Metropolitan Base Incentives”). B. MWDOC is a member agency of Metropolitan and has agreements with Metropolitan that enable residential, commercial, and industrial water users in MWDOC’s service area, and for the benefit of MWDOC’s member agencies, to participate in and take advantage of Metropolitan’s Base Incentives. C. Participant Agency, as a MWDOC member agency or a direct Metropolitan member agency, may elect to participate in Metropolitan’s program to replace non-conserving items within its service area. D. The Metropolitan Base Incentives amounts for each eligible device or program available to MWDOC and Metropolitan member agencies are listed in the attached Addendums 1A and 1B. It is expected that Metropolitan will establish funding for additional water conservation items and to change some or all of the existing funding rates throughout the term of this Agreement. Any such changes will be incorporated herein by amendment to Addendums 1A and 1B. E. Metropolitan and MWDOC each have fiscal responsibility to manage their individual budgets, and hence may have a need to limit availability of funds. F. MWDOC and Metropolitan member agencies may also choose to provide additional supplemental funding of their own to augment the Metropolitan Base Incentives. Based on the terms and conditions of this Agreement, MWDOC will facilitate supplemental funding for Participant Agency through the Metropolitan rebate contractor (“Rebate Contractor”) or MWDOC directly. Metropolitan member agencies will coordinate any supplemental funding directly with Metropolitan. G. In addition to the Metropolitan Base Incentives, MWDOC has developed and arranged additional local, state, and federal grant funding (“Grant Funding”) for eligible devices in a number of water conservation programs (“MWDOC Administered Programs”) that MWDOC offers to Participant Agency and Metropolitan member agencies. This grant funding may be used to enhance the Metropolitan Base Incentives. Granting agencies Page | 2 include, but are not limited to, the Department of Water Resources and the United States Bureau of Reclamation. H. Participant Agency may also operate customized, local water conservation incentive programs in their respective service areas (“Participant Agency Administered Programs) and may have access to the Metropolitan Base Incentives and Grant Funding for such, subject to MWDOC and Metropolitan approval and the terms and conditions of this Agreement and any MWDOC and/or Metropolitan agreements. I. The purpose of this Agreement is to create a master water conservation participation agreement between MWDOC and Participant Agency that combines all of the conservation programs and incentives (“Programs”) into one agreement. Addendums to this Agreement will be issued for changes involving Metropolitan approved items, MWDOC Board approved items, Grant Funding, adding and subtracting MWDOC Administered Programs and Participant Agency Administered Programs as identified in Section 2, and changes to incentive programs, including funding and incentive levels. NOW THEREFORE, in consideration of the promises and covenants hereinafter set forth, the Parties do agree as follows: Section 1: Agreement Term and Administration 1.1 This Agreement will be effective on July 1, 2015 or upon execution of this Agreement by all Parties, whichever is later, and shall terminate on June 30, 2025 (‘Term”). Continuance of this Agreement will be subject to annual budget approval by MWDOC’s Board of Directors. 1.2 This Agreement may be amended at any time by written mutual agreement of the Parties, or by Addendums issued by MWDOC as set forth in Recital I. 1.3 This Agreement may be terminated by either Party for any reason upon thirty (30) days written notice to the other Party. 1.4 All Addendums are enforced for the duration of this Agreement unless the Addendums are amended or terminated by either Party. 1.5 In the event the Agreement is terminated early, Participant Agency is responsible for payment of any funding contributions required by this Agreement that that were initiated prior to the effective date of the termination. For purposes of this Agreement, an application is deemed initiated when an application has been received by Metropolitan’s rebate vendor, EGIA, by MWDOC, or a reservation has been made within any of MWDOC’s online application portals that is pursuant to any of the programs described within this Agreement and the attached Addendums. 1.6 Notwithstanding any other provision in this Agreement, funds for all of the programs described within this Agreement and the attached Addendums are conditioned upon the Page | 3 availability of funds and MWDOC is under no obligation to provide funding for any of the programs if MWDOC determines, in its own discretion, that such funding is exhausted, reduced, eliminated, or unavailable from any funding source, for any reason. Section 2: Program Funding 2.1 Supplemental Funding 2.1.1 In addition to the Metropolitan Base Incentives, Participant Agency may provide additional funding to augment the Metropolitan Base Incentives amounts for those programs and devices that Participant Agency identifies, and in the amounts indicated, in the appropriate locations in Addendums 2A, 2B, and 2C (“Supplemental Funding”). The Supplemental Funding listed in Addendums 2A through 2C shall specify the amount of Supplemental Funding Participant Agency will provide per device or program, as well as the total maximum Supplemental Funding amount committed to each category of device or program. If the Participant Agency does not complete, sign, and return Addendums 2A through 2C to MWDOC, notwithstanding any other provision of this Agreement, the Participant Agency will not be bound by this Section or the provisions in Addendums 2A through 2C. In general, Supplemental Funding Addendums submitted by the 15th of a month will become effective the first of the following month. 2.1.2 If Participant Agency elects to provide Supplemental Funding or enhanced incentives under this Agreement for any device or program, Participant Agency is responsible for tracking the use of and the remaining availability of those funds. MWDOC will assist, in every way possible, but the ultimate responsibility for tracking all Participant Agency funding is the responsibility of Participant Agency. Participant Agency will ultimately be responsible for any overuse of Participant Agency Supplemental Funding. 2.1.3 Any requests for changes or revisions to Participant Agency’s Supplemental Funding, including funding transfers between Programs, must be submitted by Participant Agency to MWDOC in the form of revised Addendum 2s listing the new funding amounts/limits. 2.1.4 The Participant Agency may elect to participate in the Supplemental Funding Program and be bound by the provisions of this Section 2.1, Sections 3, 5, 6, 7, and 8 of this Agreement, and Addendum 2A through 2C by having its authorized representative complete and sign Addendum 2A through 2C in the spaces provided. 2.2 MWDOC Administered Programs 2.2.2 Participant Agency may elect to take advantage of the MWDOC Administered Programs by having its authorized representative complete and sign Addendums 3A through 3C in the spaces provided. If Participant Agency completes and signs Addendums 3A through 3C, Participant Agency agrees to be bound by the provisions of this Section 2.2, Sections 3, 5, 6, 7, and 8 of this Agreement, and Addendums 3A through Page | 4 3C. If the Participant Agency does not complete, sign, and return Addendums 3A through 3C, notwithstanding any other provision of this Agreement, the Participant Agency will not be bound by this Section or the provisions in Addendums 3A through 3C. 2.3 Participant Agency Administered Programs 2.3.1 From time to time, funding may be made available for Participant Agency to operate a customized member agency administered local water conservation incentive program or programs (“Participant Agency Administered” “PA” or “MAA Program”) in its service area and access the Metropolitan Base Incentives for such, subject to MWDOC approval of the program and the terms and conditions of this Agreement and Addendum 4. The Participant Agency Administered Program(s) and requirements in connection with it are described in more detail in Addendum 4. 2.3.2 Upon receipt of approval of a Participant Agency Administered Program by MWDOC, Participant Agency is bound by the provisions of Sections 3, 5, 6, 7, and 8 of this Agreement and Addendum 4. 2.4 Exhaustion of Funding 2.4.1 In the event Participant Agency provided funding for any Program or device is exhausted, and Participant Agency does not elect to add additional funding or transfer available funding from another Program or device, MWDOC will discontinue offering the additional rebate funding for that Program or device in Participant Agency’s service area. Notwithstanding any other provision in this Agreement, MWDOC may terminate this Agreement as it relates to Section 2 at any time without prior notice in the event that MWDOC determines that funding for any device or program on Addendums 2 through 4 or MWDOC Grant Funding is exhausted, reduced, eliminated, or unavailable from any funding source, for any reason. Section 3: Participant Agency Responsibility and Ownership 3.1 Participant Agency, at its sole discretion, may independently contract with its own agents under separate agreements for program administration and management for any Participant Agency Administered Program provided that doing so does not compromise program performance, create or present a conflict of interest, or violate the terms of this Agreement. 3.2 Participant Agency and/or its agent shall provide all necessary services and materials for such Participant Agency Administered Programs including, but not limited to the following: program administration, promotion, marketing materials, data collection, and analysis, installation verification, and reporting. 3.3 All materials and supplies necessary to implement a Participant Agency Administered Program shall be the exclusive property of Participant Agency. MWDOC shall have no Page | 5 ownership, right, title, security interest, or other interest in any Participant Agency Administered Program materials or supplies, nor any rights duties, or responsibilities, therefor. 3.4 Participant Agency is responsible for assuring that any Participant Agency Administered Program complies with all federal, state, and local requirements. 3.5 Participant Agency agrees to cooperate with MWDOC’s data management activities related to assessing device saturation and program success. 3.6 As part of any Participant Agency Administered Program, Participant Agency shall use, maintain, and submit to MWDOC within the designated timeframe an electronic database, to be approved by MWDOC prior to use, for any conservation items installed, distributed, or rebated by Participant Agency or its agents to avoid duplicate distributions and to determine the saturation rate of items by the appropriate geographic delineation. 3.7 Participant Agency is solely responsible for the performance of its staff or representatives in complying with the terms of this Agreement and for the proper allocation and appropriate use of funds provided by Metropolitan and/or MWDOC for the purpose of achieving water conservation savings under this Agreement. Section 4: MWDOC’s Obligations 4.1 MWDOC will be response to Participant Agency for ensuring that timely reports on the Programs’ results are prepared by MWDOC’s staff. 4.2 MWDOC will develop a database of information regarding participation in the Programs and provide monthly electronic and/or written reports of activity to Participant Agency. 4.3 MWDOC will invoice Participant Agency for any Participant Agency funding obligations on a monthly basis for rebates issued in the previous month. 4.4 MWDOC does not guarantee any minimum number of rebates will be available for Participant Agency’s service area. Section 5 Marketing. 5.1 Participant Agency agrees to assist in the marketing of programs it participates in under this Agreement. With regard to Participant Agency Administered Programs, Participant Agency will be solely responsible for marketing its Participant Agency Administered Program to customers in its service area. Section 6: Installation Verification 6.1 Participant Agency shall be responsible for conducting installation verifications of items installed, distributed, and/or rebated by Participant Agency under Participant Agency Page | 6 Administered Programs, and/or for paying all costs associated with this verification. Installation verification measures for program devices must be designed to ensure that materials, installation verifications of eligible program devices, and services meet requirements established by Metropolitan, which requirements will be provided to Participant Agency by MWDOC. 6.2 Participant Agency may be responsible for conducting installation verifications of items installed, distributed, and/or rebated by Participant Agency or MWDOC under MWDOC Administered Programs, and/or for paying all costs associated with this verification. Installation verification measures for program devices must be designed to ensure that materials, installation verifications of eligible program devices, and services meet requirements established by Metropolitan, which requirements will be provided to Participant Agency by MWDOC. 6.3 MWDOC reserves the right to conduct installation verification of items within Participant Agency’s service area. 6.4 Participant Agency acknowledges that any device receiving funding from Metropolitan may be subject to an installation verification to be performed by Metropolitan, or its agent(s), at Metropolitan’s discretion. 6.5 Participant Agency shall promptly refund to MWDOC any amounts paid under any Participant Agency Administered Program or MWDOC Administered Program for installed or distributed devices in the event MWDOC or Metropolitan establishes via installation verification that the program devices were not installed. Section 7: Reporting and Invoicing 7.1 For any and all Supplemental Funding provided by Participant Agency and/or Participant Agency provided funding or inspection costs under the MWDOC Administered Programs pursuant to Section 2 of this Agreement, and as more particularly described in Addendums 2 and 3, MWDOC will invoice Participant Agency on a monthly basis for the cost of such funding, and Participant Agency must pay the full amount of such invoice within thirty (30) days of receipt of any such invoice. 7.2 For any and all Participant Agency Administered Program(s), Participant Agency will invoice MWDOC on a monthly basis, by the 10th of each month, for any approved funding and costs associated with the Participant Agency Administered Program(s) as indicated in and subject to the provisions of Addendum 4. MWDOC is under no responsibility to reimburse Participant Agency for any costs incurred by Participant Agency that are not approved by MWDOC consistent with the terms and conditions of this Agreement and Addendum 4. The invoice package shall include a fully completed, to the satisfaction of MWDOC, Excel customer/applicant spreadsheet showing program activity, and an invoice, signed by the General Manager or designee of Participant Agency, certifying the information provided as accurate. Participant Agency shall use the Excel customer/applicant spreadsheet and Invoice forms approved by MWDOC. Page | 7 7.3 Participant Agency shall maintain all Participant Agency Administered Program information, including Participant Agency applications, water bills, and purchase receipts, for a period of seven years from the end date of this Agreement. 7.4 Payment of Participant Agency invoices shall be in the form of either a credit on MWDOC’s water bill to Participant Agency or a check made payable to Participant Agency. Method of payment shall be at MWDOC’s discretion. Section 8: Confidentiality 8.1 MWDOC agrees to maintain the confidentiality of Participant Agency’s customer names, addresses, and other information gathered in connection with this Agreement. MWDOC will not cause or permit the disclosure of such information expect as necessary to carry out any of the MWDOC Administered or Participant Agency Administered Programs, or as required by law. To the extent that MWDOC contracts with third party contractors to carry out all or any portion of any of the Programs, MWDOC will require such contractors to maintain the confidentiality of such customer information. 8.2 Notwithstanding anything to the contrary in this Agreement, Participant Agency acknowledges and agrees that MWDOC may request and use historical water consumption data for purposes of satisfying any grant water use and water quality evaluation requirements of any of the Programs. Participant Agency also acknowledges and agrees that MWDOC may also request to use Program applicant information, such as name, mailing address, site photos, and email address to market other water use efficiency programs to past applicants. A similar provision will be required of every individual applicant. Section 9. Indemnification. 9.1 The parties agree that each Party shall be responsible for its own actions, and the actions of its officers, employees, and agents, in performing services under this Agreement. Except as provided in this Agreement and its Addendums, each Party agrees to indemnify and hold the other Party and its officers and agents harmless and agrees to defend the other Party against any claim or asserted liability arising out of its actions, either willful or negligent, or the actions of its officers, employees, and agents, in performing services pursuant to this Agreement. Such indemnity will include any losses relating to any claim made, whether or not a court action is filed, and will include attorney fees and administrative and overhead costs related to or arising out of such claim or asserted liability. 9.2 Participant Agency shall include the following language in its agreement with any consultant or contractor retained by Participant Agency to work on any of the Program” “(Consultant) agrees at is sole cost and expense to protect, indemnify, defend, and hold harmless Metropolitan, MWDOC, and their associated Boards of Directors, officers, representatives, agents and employees from and against any and all claims and liability Page | 8 of any kind (including, but not limited to, any claims or liability for injury or death to any person, damage to property, natural resources or to the environment, or water quality problems) that arise out of or related to Participant Agency’s approval, construction, operation, repair, or ownership of any Program. Such indemnity shall include all damages and losses related to any claim made, whether or not a court action is filed, and shall include attorneys’ fees, administrative and overhead costs, engineering and consulting fees, and all other costs related to our arising out of such claim or asserted liability.” Section 10. Certification re Lobbying (43 CFR 18) 10.1 The undersigned hereby certifies on behalf of Participant Agency that no Federal appropriated funds have been paid or will be paid, by or on behalf of the Participant Agency, to any person for influencing or attempting to influence an officer or employee of a Member of Congress in connection with the awarding of any Federal contract, the making of any Federal grant, the making of any Federal loan, the entering into of any cooperative agreement, and the extension, continuation, renewal, amendment, or modification of any Federal contract, grant, loan, or cooperative agreement. If any funds other than Federal appropriated funds have been paid or will be paid to any person for influencing or attempting to influence an officer or employee of any agency, a Member of Congress in connection with a Federal contract, grant, loan, or cooperative agreement, the undersigned shall complete and submit Standard Form LLL, “Disclosure Form to Report Lobbying” in accordance with its instructions. To the extent federal funds are involved, the Participant Agency shall require that the language of this certification be included in the awards documents for any sub-awards by the Participant Agency at all tiers (including sub-contracts, sub-grants, and contracts under grants, loans and cooperative agreements) and that sub-recipients, if any, shall certify accordingly. Section 11. Other Terms 11.1 Any alteration or variation of the terms of this Agreement will not be valid unless made in writing and signed by both Parties. 11.2 This Agreement will inure to the benefit of and be binding upon the Parties and their respective successors. 11.3 The partial or total invalidity of one or more parts of this Agreement will not affect the intent or validity of this Agreement. 11.4 This agreement shall be deemed a contract made under the laws of the State of California, and for all purposes will be interpreted in accordance with such laws. The Parties hereby agree and consent to the exclusive jurisdiction of the courts of the State of California, and that the venue of any action brought hereunder will be in Orange County, California. /// /// Page | 9 11.5 This Agreement constitutes the entire agreement between the Parties. IN WITNESS WHEREOF, the parties hereto have executed this Agreement. MUNICIPAL WATER DISTRICT YORBA LINDA WATER DISTRICT OF ORANGE COUNTY By: ________________________ By: __________________________ Robert J. Hunter Marc Marcantonio General Manager General Manager Date: ________________________ Date: __________________________ Approved as to Form: ___________________________ Kidman Law, LLP Date: ___________________________ ITEM NO. 8.3 AGENDA REPORT Meeting Date: July 9, 2015 To:Board of Directors From:Marc Marcantonio, General Manager Presented By:Marc Marcantonio, General Manager Prepared By:Annie Alexander, Executive Secretary Subject:Nominations for Association of California Water Agencies (ACWA) President and Vice President STAFF RECOMMENDATION: That the Board of Directors consider nominations for ACWA President and Vice President. DISCUSSION: ACWA's Nominating Committee is responsible for submitting a slate of candidates for President and Vice President to the general membership at the Fall Conference. The YLWD Board of Directors has the option of nominating one of its own Directors for these slates by resolution. Individuals being nominated for ACWA President or Vice President must meet the following criteria in order to be considered by the Nominating Committee: Be an elected or appointed Director of an ACWA member agency. Submit an official resolution of nomination from the agency for which they serve. Submit a resume highlighting their qualifications for the position. ACWA elections will take place at the ACWA Fall Conference in December. If elected, the candidates would begin their two-year term as ACWA President or Vice President on January 1, 2016. A certified copy of an adopted resolution nominating a candidate will need to be submitted to ACWA on or before September 1, 2015. ATTACHMENTS: Name:Description:Type: ACWA_Nominations.pdf Backup Material Backup Material • s 'tas• t,,••,rA, w.r.� f;^ rFaw' °^t4a^ Association of ,.' ., y e k yyj� [S 3 � i •\C `1'Yi'I i1PfiN t� M California Water Agencies 1 pit , r� tr Since 791t) " .3 :r` i I .,l L .: , ; ;1 ' .. 1 ♦ i i` r , MEMORANDUM TO : ACWA Public Agency Members General Managers and Board Presidents CC: ACWA Board of Directors FROM : ACWA Nominating Committee DATE : June 3, 2015 SUBJECT: Call for Candidate Nominations for the 2016-2017 Term ACWA' s Nominating Committee is responsible for submitting a slate for the Association's statewide positions of president and vice president to the general membership meeting at Fall Conference . Nominations must be received in the ACWA office by Tuesday, September 1, 2015, to be considered by the committee . The following criteria must be met for names to be considered : Only elected or appointed member of the governing body or commission ( as appropriate ) of a member agency of the Association shall be eligible for election to the officer positions . • Nominations of qualified candidates are encouraged from all member agencies . All nominations for the positions of ACWA President and Vice President shall be accompanied by an official nominating resolution from the ACWA member agency on whose board the nominee serves . Said resolution shall be signed by an authorized signatory of the member agency's Board of Directors . A resume of the candidate, highlighting qualifications for the position, shall accompany each nomination . Additional letters or resolutions of support from other agencies may be submitted but are not required . ACWA' s Bylaws and Board policies establish the criteria outlined above, which also govern nominations from the floor. Board policy requires that all nominations received for the positions of ACWA President and Vice President shall be accompanied by a nominating resolution from Association of California Water Agencies 910 K Street, Suite 100, Sacramento, California 95614 -3577 916/441 -4545 r:\ c 916/325 -4849 Hall of the States 400 N . Capitol St. , N .W. , Suite 357 South , Washington , D. C . 20001 - 1512 202 /434 -4760 \x 202/434-4763 www.acwa .com ACWA Public Agency Members General Managers and Board Presidents Call for Candidate Nominations June 3, 2015 — Page 2 the ACWA member agency on whose board the nominee serves, and signed by an authorized signatory of the Board of Directors . This policy applies to nominations received in the ACWA office prior to elections, as well as to all nominations received from the floor at general session during the floor nomination process . We appreciate your interest and participation in this process to find the best qualified individuals to serve in representing the statewide membership of ACWA. Nominating Committee members include : • Judith Mirbegian, Region 1 • William Taube, Region 7 Eric Larrabee, Region 2 • Stephen Cole, Region 8 • Joe Parker, Region 3 Harvey Ryan, Region 9 • Shauna Lorance, Region 4 • Linda Ackerman, Region 10 • Lesa McIntosh, Region 5 Randy Record, At- large representative • Matthew Hurley, Region 6 • Paul Kelley, At-large representative We ask that Nominating Committee members not be approached to solicit their support of any candidate . IMPORTANT DATES • Tentative date for candidate interviews : Wednesday, September 16, 2015 • Election of ACWA' s President and Vice President : Wednesday, December 2, 2015, at Fall Conference Should you have any questions regarding this process, please contact Clerk of the Board Donna Pangborn at the ACWA office at 916-441-4545 or donnap@acwa . com Enclosures : 1 . Basic Information for ACWA Officer Nominees z . Sample Resolution to Nominate Candidate for ACWA President or Vice President Association of California th�afier Agencies l BASIC INFORMATION FOR ACWA OFFICER NOMINEES 1_ 21 Board Officers The president and vice president of the Association shall be the elected officers of the Association . 1 . 1 . 1 President 1 . 1 . 1 . 1 Puiwoso The president is an elected officer of the Association and presides at all meetings of the Board of Directors, the Executive Committee, and the general membership and is responsible to the Board of Directors and the general membership for the duties established by ACWA's Bylaws . 1 . 1 . 1 .2 Di-ities and Atrtliority Within the limits of ACWA's Bylaws and the Duties and Authorities established for ACWA Board members, and in coordination with the executive director, the president : • Serves on the ACWA Board and presides at all meetings . • Serves as the chair of the Executive Committee and presides at all meetings . • Schedules special Board and Executive Committee meetings . • Presides over all general membership meetings . • Serves as a non-voting ex officio member of each committee, but shall not be an ex officio , member of the Nominating Committee or the region boards. • Appoints members of all committees upon recommendation from members and regions as communicated by the region chairs . • Appoints the chair and vice chair of each committee, each of whom shall be ratified by the Board of the Directors . • Appoints special committees, work groups, and task forces from time to time as needed to accomplish a specific task or assignment, consistent with and supportive of the mission of the Association . • Participates in the Association's spring and fall conferences . • Represents and supports ACWA's official policies and positions when acting in capacity of ACWA President. • Represents and promotes ACWA's purposes, policies, and goals at a variety of ACWA functions/events, including visits to member agencies for ceremonies, meetings, and retention efforts in coordination with the executive director. BASIC INFORMATION FOR ACWA OFFICER NOMINEES • Represents and promotes ACWA' s purposes, policies, and goals at a variety of external functions/events, including speaking engagements, event participation, and news media and other contacts in coordination with the executive director. • Performs other responsibilities assigned by the Board . 1 . 1 . 1 . 3 Qualification The president shall be an elected or appointed member of the governing body or commission of a member agency of the Association at the time of his/her election . 1 . 1 . 14 Terns ref office The president shall be elected by the members of the Association at its fall conference in each odd- numbered year and shall take office on January 1 of the calendar year following election . The president shall hold office until December 31 of the following odd numbered year two years later or until his/her successor takes office or is appointed . An elected president shall not be permitted to succeed himself/herself to that office . 1 . 1 . 1 . .E Vtrcancy Should a vacancy occur in the president' s office, the ACWA vice president shall assume the duties of that office and succeed the president for the unexpired term . Should the vice president not be able to assume this role, the Board of Directors shall appoint a person to fill the office for the unexpired term thereof. 1 . 1 . 1 . 6 Compensation ACWA's president shall serve without compensation . The president shall be allowed reasonable reimbursement of expenses incurred in the performance of his/her duties while on Association business . The president will be reimbursed for expenses incurred for attending conferences, meetings, seminars, workshops or other events, which are mutually beneficial to the officer and the Association and have been authorized by either the Board of Directors or the executive director. 1 . 1 . 2 Vice President 1 . 1 . 2. 1 Purpose The vice president is an elected officer of the Association and is a voting member of the Board of Directors . The vice president is responsible to the Board of Directors and the general membership for the duties established by ACWA' s Bylaws . 1 . 1 .2. 2 Ditties and Authority Within the limits of ACWA's Bylaws and the Duties and Authorities established for ACWA Board members, and in coordination with the executive director and president, the vice president : • Serves as a voting member of the Board of Directors . • Serves as a voting member of the Executive Committee . Page 12 BASIC INFORMATION FOR ACW.A OFFICER NOMINEES Performs the duties of the president in the president's absence . • Succeeds the president for an unexpired term if vacancy occurs . i Serves on ACWA/JPIA' s Executive Committee . • Participates in the Association' s spring and fall conferences . • Represents and supports ACWA' s official policies and positions when acting in capacity of ACWA . Vice President. • Represents and promotes ACWA's purposes, policies, and goals at a variety of ACWA functions/events, including visits to member agencies for ceremonies, meetings, and retention efforts in coordination with the executive director . • Represents and promotes ACWA' s purposes, policies, and goals at a variety of external functions/events, including speaking engagements, event participation, and news media and other contacts in coordination with the executive director. i Serves as a chair/vice chair or participant on committees or task forces as appointed by the president or Board of Directors . • Performs other responsibilities assigned by the Board or president. 1 , 1 . 23 (qualification The vice president shall be an elected or appointed member of the governing body or commission of a member agency of the Association at the time of his/her election . 1 . 1 . 2. 4 Tei-m of Office The vice president shall be elected by the members of the Association at its fall conference in each odd- numbered year and shall take office on January 1 of the calendar year following election . The vice president shall hold office until December 31 of the following odd numbered year two years later or until his/her successor takes office or is appointed . 1 . 1 . 2. 5 Vacancy Should a vacancy occur in the vice president' s office, the Board of Directors shall appoint a person to fill the office for the unexpired term thereof. 1 . 1 . 2. 6 Compensation ACWA' s vice president shall serve without compensation . The vice president shall be allowed reasonable reimbursement of expenses incurred in the performance of his/her duties while on Association business . The vice president will be reimbursed for expenses incurred for attending conferences, meetings, seminars, workshops or other events, which are mutually beneficial to the officer and the Association and have been authorized by either the Board of Directors or the executive director. Page 3 Association of California Water A SAMPLE RESOLUTION TO NOMINATE CANDIDATE FOR Agencies ACWA PRESIDENT OR VICE PRESIDENT RESOLUTION OF THE BOARD OF DIRECTORS OF TO NOMINATE AND SUPPORT AS A CANDIDATE FOR THE POSITION OF ACWA WHEREAS, ACWA has announced that a Nominating Committee has been formed to develop a slate for the Association's statewide positions of President and Vice President; and WHEREAS, the individual who fills an officer position will need to have a working knowledge of water industry issues and concerns, possess strength of character and leadership capabilities, and be experienced in matters related to the performance of the duties of the office; and WHEREAS, this person must be able to provide the dedication of time and energy to effectively serve in this capacity; and WHEREAS, has served in a leadership role as a member of the Board of Directors since ; and WHEREAS, ( list positions held to demonstrate knowledge of water and leadership ) WHEREAS, WHEREAS, WHEREAS, it is the opinion of the Board of Directors that possesses all of the qualities needed to fulfill the duties of the office of ACWA NOW, THEREFORE, BE IT RESOLVED, that the Board of Directors does hereby nominate and support as a candidate for the office of ACWA , pledging the District's support of his/her endeavors in fulfilling the duties of this office if elected . PASSED AND ADOPTED by the Board of Directors at a regular meeting of said Board held on the day of 2015, by the following vote : Ayes: Directors Noes : Directors Absent: Directors ITEM NO. 8.4 AGENDA REPORT Meeting Date: July 9, 2015 To:Board of Directors From:Marc Marcantonio, General Manager Presented By:Marc Marcantonio, General Manager Prepared By:Annie Alexander, Executive Secretary Subject:California Special Districts Association (CSDA) 2015 Board Elections STAFF RECOMMENDATION: That the Board of Directors consider voting for one of the nominated candidates in the CSDA 2015 Board Election. DISCUSSION: The attached ballot is for the District's use in voting to elect a representative to the CSDA Board of Directors in our network for Seat A. Each of CSDA's six networks has three seats on the Board. Each member district in good standing is entitled to vote for one director to represent its network. Ballots must be received by 5:00 p.m. on Friday, August 7, 2015. Also attached is background information submitted by each candidate. The current incumbent in the expiring seat is Jo MacKenzie from the Vista Irrigation District. The Board of Directors recently adopted a resolution concurring in Ms. MacKenzie's nomination to the CSDA Board of Directors. ATTACHMENTS: Name:Description:Type: CSDA_Election.pdf Backup Material Backup Material Approved by the Board of Directors of the Yorba Linda Water District 7/9/2015 MB/RK 5-0 Voting for Ms. Jo MacKenzie from the Vista Irrigation District to serve as a representative to the CSDA Board of Directors in Seat A for the Southern Network. California Special Districts Association 00100 Districts Stronger Together CALIFORNIA SPECIAL DISTRICTS ASSOCIATION 2015 BOARD ELECTIONS MAIL BALLOT INFORMATION Dear Member : A mail ballot has been enclosed for your district' s use in voting to elect a representative to the CSDA Board of Directors in your Network for Seat A . Each of CSDA ' s six (6 ) networks has three seats on the Board . Each of the candidates is either a board member or management- level employee of a member district located in your network . Each Regular Member (district) in good standing shall be entitled to vote for one ( 1 ) director to represent its network. We have enclosed the candidate information for each candidate who submitted one . Please vote for only one candidate to represent your network in Seat A and be sure to sign , date and fill in your member district information . If any part of the ballot is not complete , the ballot will not be valid and will not be counted . Please utilize the enclosed return envelope to return the completed ballot . Ballots must be received at the CSDA office at 1112 1 Street , Suite 200 , Sacramento , CA 95814 by 5s00pm on Friday, August 7 , 20150 If you do not use the enclosed envelope , please mail in your ballot to : California Special Districts Association Attn : 2015 Board Elections 1112 1 Street, Suite 200 Sacramento , CA 95814 Please contact Charlotte Lowe toll-free at 877.924.CSDA or charlotte) ancsda . net with any questions. Candidate statement Southern network Seat A V Jo MacKenzie PROVEN EXPERIENCE LEADING SPECIAL DISTRICTS It would be an honor to continue serving special districts on the CSDA Board of Directors . I am committed to building on the present foundation of CSDA' s educational programs and legislative and public outreach, so that CSDA continues to be recognized as the voice of all special districts . My enthusiasm, commitment, and comprehensive knowledge of special districts and LAFCO, along with my years of experience, will help me to be of service to your district as a member of the CSDA Board of Directors . Representing the Southern Network, I will bring to the organization years of experience in local government and a strong understanding of how the California Special Districts Association can best serve its members . I have served as CSDA President, Treasurer and the Chair of Legislative Committee . I know the commitment and time it takes to be an effective board member. A flexible schedule is paramount to being a successful Director. I have attended all board of director and assigned committee meetings, read through a myriad of legislation in order to relate to the Advocacy and Public Affairs Department what impact I think such legislation may have on districts' ability to provide local services I have completed CSDA' s Special District Leadership Academy which is a requirement to serve on the CSDA Board . Under my leadership, my district, Vista Irrigation District, has obtained the Special District Leadership Foundation District of Distinction Designation and the District Transparency Certificate of Excellence . I believe it is important to the continued success and growth of CSDA that the Board of Directors remain committed to its mission : to provide legislative advocacy education and member services for all special districts . Your District's vote will be greatly appreciated ! CANDIDATE STATEMENT FOR GLORIA A. DIZMANG In December of 2011 , 1 was sworn in as a Director of the Palmdale Water District Board . I knew little about water but I had agreed to serve an agency that was fairly beaten up — legally, economically, and in the area of morale . PWD was engaged in three lawsuits with the City of Palmdale . We had dropped in our credit rating and could no longer receive loans/grants. The employees were split into two warring camps . Today, we are on our way to a stable and professional future, due to the actions of the new Board, on which I serve . This is what we have achieved : – Low and consistent rate increases improved our credit to the point that we issued an $ 8 . 5 million revenue bond for infrastructure . – Provided a legal water rate assistance program for seniors . – Settled all lawsuits with the City of Palmdale . – Developed a Customer Care program to assist our rate -payers . – Replaced 80 % of our infrastructure from the 1950s. – Reordered the organizational chart, without lay- offs, for more efficiency. – Developed and implemented educational programs for our rate - payers . (top contender in ACWA' s Best in Blue) – Developed and continue to offer an intern program to train young people in the basic facets of the water industry. As part of our Board, I was a leading member to move in these directions . I believe my background in education can be of assistance in the CSDA. My experience in the area looks small in comparison to others who have served on many boards and in many organizations . Nevertheless, I can see things with a different perspective and am not afraid to speak up and to actively support change . I would be honored to receive your vote . Thank you . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 000 e 00 . . . . . . a 0 a 0 0 0 0 0 0 0 0 4 0 0 0 0 A csoa 1= ...... ............................ SEAT A term ends 2018 .................................. Please vote for only one. ❑ Jo MacKenzie* Vista Irrigation District Gloria Dizmang Palmdale Water District _ q11 fielOf must Ogffl&iV ffj l .et to be c iR SIGNATURE MEMBER DISTRICT: i DATE " incumbent running for re-election Must be received by 5pm, August 7, 2015. CSDA, 1112 1 Street, Suite 200, Sacramento, CA 95814 ITEM NO. 8.5 AGENDA REPORT Meeting Date: July 9, 2015 To:Board of Directors From:Marc Marcantonio, General Manager Presented By:Marc Marcantonio, General Manager Prepared By:Annie Alexander, Executive Secretary Subject:Proposed Amended and Restated Independent Special Districts of Orange County (ISDOC) Bylaws STAFF RECOMMENDATION: That the Board of Directors consider approving the amended and restated ISDOC bylaws. DISCUSSION: ISDOC's bylaws were last amended and approved by the membership in December 2013. In November 2014, an officer of the Executive Committee was not re-elected by their respective District and a mid-term vacancy was created. The revised bylaws were silent on this situation. In February 2015, the Executive Committee formed an ad hoc committee, which was tasked with reviewing the bylaws and suggesting modifications for previously unforeseen situations. The resulting proposed amendments went through a formal review and comment process which culminated in an affirmative vote of ISDOC's Executive Committee for approval and presentation to the membership for a vote. Members must submit their ballots by 5:00 p.m. on Friday, July 24, 2015. Although the majority of the modifications are simply cleanup or consolidation of language, the following substantial changes are being proposed: 1.Location for official document storage. 2.Election of single candidates for office by ratification. 3.Process for filling midterm vacancies in officer positions. 4.Removal of officers for excessive absences. Detailed information regarding the proposed changes and a copy of the draft amended and restated bylaws are attached. ATTACHMENTS: Name:Description:Type: ISDOC_Bylaws.pdf Backup Material Backup Material Approved by the Board of Directors of the Yorba Linda Water District 7/9/2015 PH/GM 5-0 RECEIVED ISD fC JUN 17 20 15 YORBA LINDA WATER DISTRICT Independent Special Districts of Orange County DATE : June 10, 2015 TO : ISDOC Members FROM : Mike Scheafer, President, ISDOC Executive Committee SUBJECT : Proposed Amended and Restated Bylaws In 2013 , ISDOC concluded a multiyear review and modification process of its bylaws . Revised bylaws were approved by a majority of members on December 10, 2013 . In November 2014, an officer of the Executive Committee was not re-elected by his District and a mid-term vacancy was created. The revised bylaws were silent on this situation. Last February, the Executive Committee formed an ad hoc committee, which was tasked with reviewing the bylaws and suggesting modifications for previously unforeseen situations . At its April meeting, the ad hoc committee presented its recommendations to the ISDOC Executive Committee. The Executive Committee discussed the proposed charges and endorsed submittal of the revised bylaws to the general membership for comment. No comments were received. At its recent June meeting, the Executive Committee approved the amended and restated bylaws and authorized their submission to special district members for a vote. A ballot has been included with this memo, as well as a copy of the proposed amended and restated bylaws . Each regular member in good standing is entitled to one vote . The ballot must be signed by the presiding officer of the special district or an alternate designated by official action of the district. Ballots must be received by 5 : 00 p.m. on July 24th ; the results will be announced at the July 30th quarterly meeting. The proposed amended bylaws contain a number of revisions to the current ISDOC bylaws . Although the majority of the modifications are simply cleaning-up and/or consolidating language and subsequent section renumbering, there are four substantial changes proposed; those proposals are identified below. Significant modifications proposed by the Executive Committee : 1 . Official Document Storage (Page 1 , Article I, Section III, language added) : Page 1 of 2 All official documents (agendas, minutes, voted ballots, voting authorization and financial records) of the Organization shall be maintained and stored at the administrative office . 2 . Election of Single Candidates for Office by Ratification (Page 5 , Articled III, Section II, Subsection D added) : D . The Executive Committee shall be elected following a notice of position availability and solicitation for nominations . At the end of the nominating period, if only one candidate is nominated for a vacant seat, that candidate shall be deemed selected. If two or more candidates are nominated, the Secretary shall prepare and deliver one ballot and voting instructions to each eligible district. The ballot shall include the names of all nominees and the office for which each was nominated. Each presiding officer, or his or her alternate as designated by the governing body, shall return the ballot to the Secretary by the date specified in the voting instructions. 3 . Process for Filling Midterm Vacancies in Officer Positions (Page 5 , Article III, Section II, Subsection E and F added) : E. With the exception of the immediate past president, if a vacancy occurs on the Executive Committee, the Committee shall, within 60 days from the commencement of the vacancy, either fill the vacancy by appointment or call a special election to fill the vacancy. A person appointed or elected to fill a vacancy shall hold office for the unexpired term of the former incumbent. F. If the vacancy is in the offices of President or Vice President, the Executive Committee may, prior to an election to fill the vacancy, move current officers into vacant positioris. -offs proceed then to fill the resulting vacant position in accordance with Section E above. 3 . Removal of Officers for Excessive Absences (page 7, Article III, Section III, Subsection D added) : D . The Executive Committee may consider removing Officers who miss three consecutive meetings. Prior to removing an Officer, the Committee shall consider the reasons for absence and the potential for continued absence. A unanimous vote of the Executive Committee shall be required to remove an officer. Thank you in advance for your consideration of this matter. Sincerely, /f(i4 JG/ 46 De President, ISDOC Executive Committee Page 2 of 2 INDEPENDENT SPECIAL DISTRICTS OF ORANGE COUNTY Amended and Restated Bylaws The Question Does your special district, as member in good standing , approve or disapprove of the amended and restated bylaws recommended by the Executive Committee on June 2 , 2015 . ----------------------------------------------------------------------------------------------------------------------------------- CAST YOUR VOTE Please cast your vote by checking the box, or printing the name , of the nominee for who you wish to vote . Yes , we approve the amended and restate ISDOC bylaws , as recommended by the Executive Committee No , we do not approve the proposed amended and restated bylaws --------- ----------------------------------------------------------------------------------------------------------- ---- DISTRICT NAME NAME AND TITLE OF VOTONG DELEGATE* SIGNATURE OF VOTING REPRESENTATIVE * If not the presiding officer, please provide written authorization documenting your ability to vote on behalf of your district. Please send you completed and executed ballot to Heather Baez at either: • HBaez @mwdoc .com • MWDOC , P .O . Box 20895 , Fountain Valley, CA 92728 All ballots must be received no later than by 5 p. m . , Friday, July 24, 20150 INDEPENDENT SPECIAL DISTRICTS OF ORANGE COUNTY AMENDED AND RESTATED BYLAWS Proposed June 2 , 2015 Page 1 of 10 INDEPENDENT SPECIAL DISTRICTS OF ORANGE COUNTY BYLAWS ARTICLE I GENERAL SECTION I . NAME The name of the organization shall be INDEPENDENT SPECIAL DISTRICTS OF ORANGE COUNTY , herein referred to as the Organization . SECTION II . PURPOSE The purpose of the Organization is to advance the interests of Orange County special districts through its advocacy of sound public policy , its facilitation of educational opportunities to enhance special district governance and the services provided , and its collaboration with others to elevate awareness of the role special districts play as the form of government closest and most directly accountable to the people . The purpose of the Organization shall not include any duties or responsibilities held by the Orange County Special Districts Selection Committee , which is a separate and unrelated entity from the Organization . Furthermore , these Bylaws shall have no effect on , and are independent and distinct from , the Bylaws of the Orange County Special District Selection Committee . SECTION III . ADMINISTRATIVE OFFICE The administrative office for the transaction of the business of the Organization is located at the Municipal Water District of Orange County . All official documents ( agendas , minutes , voted ballots , voting authorization and financial records ) of the Organization shall be maintained and stored at the administrative office . The Board of Directors is granted full power and authority to change the administrative office from one location to any place within the County of Orange , State of California , and such change shall not be considered an amendment of these bylaws . Page 2 of 10 ARTICLE II MEMBERSHIP SECTION I . QUALIFICATION FOR MEMBERSHIP A . There shall be two categories of membership in the Organization : 1 . REGULAR MEMBERS : Shall be INDEPENDENT SPECIAL DISTRICTS that are public agencies within the County of Orange , State of California , for the local performance of governmental proprietary functions within limited boundaries , governed by a publicly elected Board of Directors or those officials appointed , in whole or in part , by another governmental body . Independent Special Districts do not include the State , the county , cities , or school districts . Independent Special Districts shall be further defined in accordance with California Government Code Section 56044 : "Independent district" or "independent special district" includes any special district having a legislative body all of whose members are elected by registered voters or landowners within the district, or whose members are appointed to fixed terms, and excludes any special district having a legislative body consisting, in whole or in part, of ex officio members who are officers of a county or another local agency or who are appointees of those officers other than those who are appointed to fixed terms. "independent special district" does not include any district excluded from the definition of district contained in Sections 56036 and 56036. 6. 2 . ASSOCIATE MEMBERS : Shall be those persons , organizations , or governmental entities that have evidenced interest in the purposes and g. oa.ls of the Organization , but are not Independent Special Districts . Officers or members of an Independent Special District are ineligible to be an Associate Member. B . APPROVAL OF MEMBERSHIP : The Executive Committee shall review and approve all applications for membership , provided that the applicant meets the established membership criteria . Page 3 of 10 SECTION II . VOTING RIGHTS A . Each Regular Member district , in good standing , shall be entitled to one vote on all matters brought before the membership for a vote . The presiding officer of the governing body of each Regular Member district shall be recognized by the Organization as the voting representative for his/her district . Each district shall designate in writing and submit to the Organization ' s Secretary one alternate governing board member who shall have the right to vote in the absence of the presiding officer . B . The Executive Committee may , at its discretion , authorize the voting upon any issue by written ballot which shall be sent via U . S . mail and email to each Regular Member district or by electronic distribution/email . Such authorization shall specify the time , date and method by which the completed written ballots must be received by the Organization . C . A majority vote of all members present at a meeting or of all written ballots received by the submission deadline shall be necessary to carry any matter voted upon . D . Associate Members shall not have the right to vote on any matter before the Organization . SECTION III . ANNUAL DUES A . Annual dues shall be due and payable on or before the first day of January of each year. New members shall pay their annual dues at the time they are approved for membership in the Organization . New member dues for the initial year shall not be pro - rated . B . The dues of the Organization shall be reviewed and set by the Executive Committee for Regular Members and Associate Members . Associate Member dues need not be the same as dues for Regular Members . A minimum of two months ' notice of changes in dues will be provided to the membership . C . No assessments , other than annual dues , shall be levied on the members of the association without an affirmative majority vote of the membership . Page 4 of 10 SECTION IV . TERMINATION OF MEMBERSHIP A . Any member in arrears in the payment of dues for a period of thirty ( 30 ) days after said dues are due and payable _shall be notified in writing by the Treasurer of such arrearage, and , if such dues shall continue unpaid for a period of another thirty ( 30 ) days , such member shall automatically cease to be a member of the Organization . B . Any member that voluntarily terminates membership in the Organization shall not be eligible for a refund of membership dues or other assessment already paid to the Organization . SECTION V . REINSTATEMENT OF MEMBERSHIP Regular and Associate memberships that were previously terminated may be reinstated after the Executive Committee receives a written petition for reinstatement and payment of the petitioners annual membership dues and other assessments for the current calendar year have been received by the Organization . ARTICLE III BOARD OF DIRECTORS SECTION I . NUMBER AND TERM OF OFFICE A . The Board of Directors shall consist of the presiding officer from each Regular Member district , in good standing . If the presiding officer is not present , then that district' s alternate representative shall act in his/her stead . B . The members of the Board of Directors shall serve until replaced by another governing board member as the presiding officer of his/her district . Any vacancy on the Board of Directors shall be filled by the new presiding officer of the District from which the vacancy occurred . SECTION II . DUTIES OF THE BOARD OF DIRECTORS A . The Board of Directors shall set policy for the Organization . B . The Board of Directors shall elect , at or before its final meeting in even years , a President , a First Vice President , a Second Vice President , Page 5 of 10 a Third Vice President , a Secretary , and a Treasurer , who shall serve for two -year terms . C . These officers , along with the Immediate Past President , shall be designated as the Executive Committee . D . The Executive Committee shall be elected following a notice of position availability and solicitation for nominations . At the end of the nominating period , if only one candidate is nominated for a vacant seat , that candidate shall be deemed selected . If two or more candidates are nominated , the Secretary shall prepare and deliver one ballot and voting instructions to each eligible district . The ballot shall include the names of all nominees and the office for which each was nominated . Each presiding officer , or his or her alternate as designated by the governing body , shall return the ballot to the Secretary by the date specified in the voting instructions . E . With the exception of the immediate past president , if a vacancy occurs on the Executive Committee , the Committee shall , within 60 days from the commencement of the vacancy , either fill the vacancy by appointment or call a special election to fill the vacancy . A person appointed or elected to fill a vacancy shall hold office for the unexpired term of the former incumbent . F . If the vacancy is in the offices of President or Vice President , the Executive Committee may , prior to an election to fill the vacancy , move current officers into vacant positions , and proceed then to fill the resulting vacant position in accordance with Section E above . Section III OFFICERS AND DUTIES A . The Executive Committee shall assist the Board of Directors in setting and implementing policy , and conducting the business of the Organization , as noted in the bylaws or approved at a General Membership Meeting or a Special Meeting of the membership . The members of the Executive Committee shall consist of: 1 . PRESIDENT : The President shall be the chief executive officer of the Organization . The President shall preside at all Page 6 of 10 meetings of the Board of Directors , the Executive Committee and the general membership . The President shall appoint all committees . The President shall represent the Organization as its official spokesperson and he/she shall also have the authority to delegate such responsibility , with approval of the Executive Committee . The President shall be an ex-officio member of all Committees . 2 . FIRST VICE PRESIDENT : The First Vice President , in the absence or disability of the President , shall perform all the duties of the President , and when so acting , he/she shall have the powers of and be subject to all the restrictions upon the President . The First Vice President shall be the Chair of the Program Committee . 3 . SECOND VICE PRESIDENT : The Second Vice President , in the absence or disability of the President and First Vice President , shall perform all the duties of the President and when so acting , shall have all the powers of and be subject to all the restrictions upon the President . The Second Vice President shall be Chair of the Membership Committee . 4 . THIRD VICE PRESIDENT : The Third Vice President , in the absence or disability of the President , First Vice President , and Second Vice President , shall perform all the duties of the President , and when so acting , shall have all the powers of and be subject to all the restrictions upon the President . The Third Vice President shall be Chair of the Legislative Committee . Page 7 of 10 5 . SECRETARY : The Secretary or his/her designee shall be responsible for all correspondence and the dissemination of F nformation to members . 6 . TREASURER : The Treasurer shall maintain the complete financial records and , establish and maintain bank accounts in the name of the Organization , and pay all bills duly approved by the Executive Committee in accordance with the yearly budget . There shall be an annual audit of the books of the Treasurer by a competent accountant or accounting agency , designated by the Executive Committee , with a report to be presented to the membership at the Organization ' s next membership meeting . 7 . IMMEDIATE PAST PRESIDENT : The Immediate Past President shall serve as a voting , ex- officio member of the Executive Committee . B . All officers of the Organization shall be elected or appointed officials of a Regular Member district . C . Officials who wish to seek election or appointment as an officer of the Organization shall first secure from his/her district an official endorsement of his/her candidacy in the form of a board resolution . D . The Executive Committee may consider removing Officers who miss three consecutive meetings . Prior to removing an Officer , the Committee shall consider the reasons for absence and the potential for continued absence . A unanimous vote of the Executive Committee shall be required to remove an officer. ARTICLE IV MEETINGS SECTION I BOARD OF DIRECTORS A . The Board of Directors shall meet quarterly or no less than three times per calendar year . The last meeting of the calendar year shall be designated as the ANNUAL MEETING of the Organization . Page 8 of 10 B . The Organization shall disseminate notices of Board Meetings at least thirty ( 30 ) days prior to the Meeting . Said notices shall be disseminated via email to all Regular and Associate Members . The Notice shall give the date , time , location and any action items for the meeting . C . Special Meetings of the Board of Directors may be called at any time by the President , any ten ( 10 ) Members of the Board of Directors or by a majority of the Executive Committee . The Organization shall disseminate notices of the Special Meeting at least five ( 5 ) business days prior to the meeting . Said notice shall give the date , time , location , and the subject matter of the Special Meeting . Action may only be taken on matters listed on the Special Meeting notice . D . All meetings of the Board of Directors shall be held in Orange County . E . No action shall be taken unless a quorum has first been established . A quorum shall be established when the designated representatives of fifty percent (50 % ) of the Regular Members are present at a duly noticed Regular or Special Meeting of the Organization , or, if a vote has been authorized by written ballot , a quorum shall be established only when the designated representatives of fifty percent ( 50 % ) of the Regular Members have submitted a ballot in the manner and by the deadline authorized by the Executive Committee . SECTION II . EXECUTIVE COMMITTEE A . The Executive Committee shall meet monthly at the Municipal Water District of Orange County , at a time specified by the President and announced in the meeting notice . The monthly meeting may be cancelled by the . President if he/she determines that there is not sufficient business to justify a meeting . B . A Special Meeting of the Executive Committee may be called by the President or a majority of the Executive Committee , with five ( 5 ) business days advance notice given in writing via email by the Organization . Such notice shall state the date , time , location and agenda for the Special Meeting . Page 9 of 10 C . All meetings of the Executive Committee shall take place in Orange County . D . A quorum shall be established by 50 % of the then -filled Executive Committee . ARTICLE V AMENDMENTS These Bylaws may be amended by a majority of the Board of Directors present at a duly noticed membership meeting or, if a vote has been authorized by written ballot , by the combined majority vote of the designated representatives present and submitting a written ballot . All proposed amendments shall be disseminated via U . S . Mail and email to each Regular Member district no less than thirty ( 30 ) days prior to the membership meeting . ARTICLE VI ENACTMENT OF AMENDMENTS These Amended and Restated Bylaws are to take effect immediately upon approval of the Board of Directors . ARTICLE VII PARLIAMENTARY AUTHORITY All matters not covered under these Bylaws shall be governed by Roberts ' Rules of Order . Page 10 of 10 ITEM NO. 8.6. AGENDA REPORT Meeting Date: July 9, 2015 To: Board of Directors From: Marc Marcantonio, General Mgr Presented By: Marc Marcantonio, General Mgr Prepared By: Damon Micalizzi, Public Affairs Mgr Subject: H.R. 2892 (Valadao, R-CA) The Western Water & American Food Security Act of 2015 SUMMARY: H.R. 2892, The Western Water & American Food Security Act of 2015, seeks to rebalance water policies in California and the West. It includes provisions designed to increase water deliveries to San Joaquin Valley agriculture at the expense of flows now dedicated to protecting fisheries - including endangered salmon and Delta smelt. Under current law, the Department of Fish and Wildlife Service has restricted the amount of water pumped to farms and cities, instead letting it flow to sea in order to protect the Delta smelt, a threatened fish species. This bill would reopen those spigots and allow water to flow from the Sacramento-San Joaquin Delta to the Central Valley until regulators can prove that the smelt and other species, such as the salmonid (a family of fish including various types of salmon), are being harmed by the pumping. Should they find the fish are being harmed, regulators would then have to undertake a study of viable alternatives before adjusting the flow of water. In addition, H.R. 2892 would also would set deadlines for federal regulators to open up several water storage projects in the west. STAFF RECOMMENDATION: Staff recommends the Board of Directors support H.R. 2892 (Valadao, R-CA) and send a letter to the Orange County Congressional Delegation indicating our support position. In addition, to sign the letters of support from Municipal Water District of Orange County and Orange County Water District. ATTACHMENTS: Western_Water_and_American_Food_Security_Act_Section_By_Section.pdf Western Water and American Food Security Act Section By Section Backup Material Western_Water_and_American_Food_Security_Act_One_Page_Summary.pdf Western Water and American Food Security Act Summary Backup Material MWDOC_Letter_-_HR_2898_-_SUPPORT.pdf MWDOC Support Letter HR 2892 Backup Material Backup Material Distributed Less Than 72 Hours Prior to the Meeting Original Author: Congressman David G. Valadao The Western Water and American Food Security Act of 2015 June 2015 1 The Western Water and American Food Security Act of 2015 Section-by-Section Overview California is a vast state with several regional climates – some of which are naturally arid. A sophisticated network of storage and delivery facilities sustain California’s water supply, and the biggest challenge is to make sure that water is in the right places at the right times so that when communities need it, they have it. Meeting that challenge is dependent upon on an even more complex and often contradictory system of laws, court decisions and regulations. The severity of historic drought conditions and federal regulations have been exacerbating Mother Nature’s refusal to cooperate the past four years, which has undoubtedly placed increased pressure on our state’s ability to supply water. Informed by previous legislative efforts that were initially developed on a bipartisan and bicameral basis, the Western Water and American Food Security Act of 2015 brings into balance the needs of Californians and the way regulatory laws are enforced. At the heart of the challenge is the dedication of vast quantities of water to protected species of fish, which is done at a great cost to entire communities and California while the condition of the fish has not measurably improved. The human costs to continue these regulatory practices are shockingly clear: they exacerbate high unemployment and reduced quality of life – especially in disadvantaged communities; threaten our nation’s food security; and place undue burdens on the environment that so many Californians rely on. Yet, the federal water administrators cannot actually quantify factual beneficial effects to listed fish from today’s policies. These facts support one central premise of the Western Water and American Food Security Act of 2015 - it is critical to put measures in place that attempt to make more water available to people, while simultaneously ensuring that federal government water managers’ decisions to protect listed species are governed by up-to-date science and are effective. Simply put, when it comes to delivering water in California, the legislation helps ensure that decisions are based on the best and most recent science, which increase the amount of water to the millions of people who rely on the critical life-giving resources while maintaining protections for listed species. To accomplish this, the Act seeks to make science-based management work better through the following: • Integrates the considerable new science developed since the current biological opinions on Delta smelt and Chinook salmon relating to the operation of Central Valley Project and the State Water Project were issued in 2008 and 2009. • Requires agencies to use the most accurate survey methods to help determine how these water projects may be operated to maximize water utilization and deliveries. • Requires agencies to consider other less water-costly alternatives that would benefit the listed species, such as installing temporary barriers in the delta to prevent saltwater intrusion or removing non-native predator fish that eat protected fish species. • Requires agencies to consider other management strategies not necessarily included in the existing biological opinions as alternatives before restricting additional pumping. o In short, if two alternative measures are equally effective in protecting listed fish species, the agencies should pursue the measures with better overall outcomes – the measure that helps listed fish species while not reducing pumping. Informed by this analysis, the Secretaries of the Interior and Commerce would continue to decide the best course necessary for both the 25 million people who depend on these water supplies and listed fish. Backup Material Distributed Less Than 72 Hours Prior to the Meeting Original Author: Congressman David G. Valadao The Western Water and American Food Security Act of 2015 June 2015 2 Additionally, in light of this historic crisis, the Act provides federal water regulators the operational flexibility during times of crises to effectively make and implement operational decisions in real time without unnecessary regulatory hurdles, while protecting the state water rights. Furthermore, to facilitate additional long-term water solutions, the Act requires that studies related to five California water storage projects, which have been delayed for nearly a decade, be expeditiously completed by the Bureau of Reclamation and presented to Congress. To assist other states in avoiding a water crisis such as that facing the State of California, the Act also contains several measures intended to facilitate a more expeditious and dependable permitting process for constructing water projects throughout the West. Titles I and II: Integrating New Science into the Management of the Species . Since the biological opinions for the California water projects were adopted in 2008 and 2009, there has been considerable new science on the smelt and the salmon species. The proposal attempts to integrate the updated data into the operation of the California water projects, without mandating specific changes in the biological opinions or prescribing particular outcomes. Delta Smelt Incidental Take. The smelt biological opinion calculated the Delta Smelt Incidental Take Level (ITL) using data from just three years: 2006, 2007, and 2008. Using only three years to calculate the ITL severely limits the method’s ability to estimate the biological and physical conditions that are likely to occur during the life of the smelt biological opinion. Increased understanding of the factors associated with Delta smelt salvage from the past several years means that the U.S. Fish and Wildlife Service should now be able to use information from before and after 2006 to provide the basis for a more robust ITL. Increase Monitoring. The proposal allows for more real-time data collection to inform real-time decisions. Numerous analyses of adult smelt salvage patterns have linked salvage to elevated turbidity levels and high negative flows in Old and Middle River. While the high salvage of Delta smelt tends not to occur without high turbidity in Old and Middle River (OMR), the existence of high turbidity does not guarantee high salvage, even when OMR flows are highly negative. The proposed sampling is designed to test for the presence of adult Delta smelt in Old River as the water becomes turbid following winter storms. If smelt are detected, then Project operations can be modified in time to avoid salvage. If no smelt are detected, then Project operations need not be heavily curtailed. Salmonids Review Management Alternatives. Delta water exports alter water movements in the Delta and can entrain migrating juvenile salmonids. However, based on particle tracking studies, the 2009 Biological Opinion hypothesized a much larger effect (in geographic range and magnitude of importance) than has been supported by more recent and robust acoustic telemetry studies of the salmonids. In addition, the reasonable and prudent alternatives in the biological opinion did not adequately address other stressors in the Delta that may overwhelm or compromise the effectiveness of water project restrictions. To clarify the relative importance of export effects, and to help identify other management actions that can contribute to species recovery, the proposal calls for the Secretary of Commerce to analyze and quantify survival benefits from a suite of action alternatives other than just reducing pumping. These actions include existing export restrictions, barriers to fish entrainment, habitat enhancements, and predation control programs. By conducting a rigorous analysis of these and other actions, the National Marine Fisheries Service will demonstrate the effectiveness of existing reasonable and prudent alternative actions and potentially identify new actions that can achieve greater or equal benefits to reducing pumping water to Central and Southern California. Program to Protect Native Fish in the Stanislaus River. Authorizes a fish predator suppression program paid for by water users on the Stanislaus River and requires that the program be scientifically-based and include a rigorous monitoring and reporting program. Backup Material Distributed Less Than 72 Hours Prior to the Meeting Original Author: Congressman David G. Valadao The Western Water and American Food Security Act of 2015 June 2015 3 Secretarial Discretion Remains to be Utilized The proposal works within current law to ensure that a particular water operation decision is made with regards to the needs of listed fish species. The Secretaries of the Interior and Commerce are directed to obtain, document, and implement the best available scientific data so that when they exercise the discretion given to them, they have the necessary information to explain their decision. A science-based framework remains. For example: • Under the smelt proposal, the Secretaries maintain negative 5,000 cubic feet per second (cfs) or higher, in Old and Middle River flows, unless lower pumping levels are necessary to protect the species. • Under the salmon proposal, the Secretary of Commerce is required to explain the basis for raising or lowering OMR flow levels within the range of the biological opinion, and to consider how alternative measures compare against water supply reductions in avoiding jeopardy to the salmon. • In addition, the Secretary of Commerce is only directed to substitute alternative management proposals for current regulatory restrictions if they would provide equivalent protections for listed salmonid species. Other Highlights of Remaining Titles: Facilitating Operational Flexibility and Providing Drought Relief . In addition, the Secretaries are directed to take certain actions while operating the Central Valley Water Project and the State Water Project, including: • While using U.S. Geological Survey data, operating the Cross Channel Gates to maximize the peak flood tide period and provide water supply and water quality benefits, consistent with emergency orders issued by the California State Water Resources Control Board; • Under limited circumstances, consistent with effects permissible under existing law and where delta conditions are suitable, allowing the sale, transfer or exchange of water at a 1:1 inflow to export ratio for the increment of increased flow of the San Joaquin River; • Expeditiously issuing permits for the use of temporary barriers or operable gates to improve water quality and water quantity under limited circumstances; • Utilizing a streamlined project elevation and decision process to ensure that final federal decisions relating to projects that provide additional water supply or address emergency drought conditions are made in a timely manner; • Authorizing the Secretaries to increase pumping to -7,500 cfs to capture high peaks of precipitation since an overwhelming percentage of our state’s water supply comes down in pulses during the first few storms of the year. Protecting the State Water Project and Preserving Senior Water Rights In California, there is a complex system of federal and state water rights, seniority, and allocation practices set by federal and state law, judicial decisions, and tradition and practice. In addition, the Central Valley Project and the State Water Project operation and environmental compliance are linked, ensuring all of California benefits from these projects. The Western Water and American Food Security Act of 2015 includes provisions designed to preserve water rights seniority and to protect the joint operation of the Federal and state water projects, thereby ensuring that Northern, Central, and Southern Californians all receive the water they are entitled too. Backup Material Distributed Less Than 72 Hours Prior to the Meeting Original Author: Congressman David G. Valadao The Western Water and American Food Security Act of 2015 June 2015 The Western Water and American Food Security Act of 2015 Legislative Summary California is enduring its worst drought in 1,200 years, and a growing number of communities across the West have become impacted by severe drought conditions. Although this challenge is not new to the arid West, it is compounded by a complex and often contradictory system of laws, court decisions, and regulations, at the state and federal level, that are failing the needs of both people and species. California’s water system is one of the most sophisticated in the world and has served as a catalyst for economic prosperity. That pioneering approach has since been abandoned and the effects have devastated our communities, threatened our food security, and have placed undue burden on our environment. Communities Grow When Water Flows California is the eighth largest economy in the world and has long served as a beacon for growth and innovation. From Palo Alto to the Central Valley to the Mojave Desert, California is home to some of our greatest innovators and achievements that ensure the United States remains the world’s leader. Water is the lifeblood of our State and failure to deliver a reliable and affordable supply in California and the Western United States jeopardizes our ability to continue to grow a more prosperous, healthy, and secure United States. Food Security California feeds our nation’s families, as half of the fruits, vegetables, and nuts consumed in the U.S. are grown in California. If California is unable produce the food our nation needs, we will be forced to turn to other nations where pesticide use and farming techniques are often far less regulated than the in United States. Furthermore, California’s contribution as “the nation’s salad bowl” is essential to a healthier America as the fight against obesity continues. Environmental Challenges When water is flushed out to the ocean, California communities are left with measures of last resort. To survive during these times of drought, communities are forced to drill for water in aquifers beneath the surface. When wells run dry and the aquifers are depleted, land subsidence and irreversible environmental damage occurs. The Western Water and American Food Security Act of 2015 would rebalance water policies in California and the West. Requiring federal and state agencies to use better science, and rooting their regulatory decisions in that new science will provide more water provided to our parched communities. It also enacts permitting reforms aimed at building infrastructure to capture water for humans and species. This would enable the movement and storage of water throughout California to better prepare for future droughts, so that the great frontier can continue to grow. Relying on Better Science in California The Western Water and American Food Security Act of 2015 does not eviscerate the Endangered Species Act. Instead, it would incorporate an empirical approach that even Bill Nye could endorse by requiring regulators to back up claims of disruption to protected fish species with actual evidence. And if disruptions to fish populations do occur, all available mitigation options must be considered before water that is contracted and paid for by our communities is diverted to the ocean. Flexibility to Plan Ahead When Mother Nature blesses California and the Western United States with periods of rain and snow, this bill would provide state and federal regulators direction and flexibility to capture water for delivery to Central and Southern California. This bill also takes a long-term approach to helping California and the Western United States by requiring the federal government to complete consideration of feasibility studies for multiple water storage projects in California that have been languishing in bureaucratic purgatory for up to ten years. By creating a process to build new storage facilities in the West, we can capture more water during wet years for use in dry years. Backup Material Distributed Less Than 72 Hours Prior to the Meeting Backup Material Distributed Less Than 72 Hours Prior to the Meeting MUNICIPAL WATER DISTRICT ® OF ORANGE- COUNTY July 8, 2015 Street Address: 18700 Ward Street Fountain Valley,California 92708 The Honorable David Valadao Mailing Address: CA Congressman, 21St District P.O.Box 20895 1004 Longworth House Office Building Fountain Valley,CA 92728-0895 Washington, D.C. 20515 (714)963-3058 Dear Congressman Valadao: Fax;(714)964-9389 g www.mwdoc.com On behalf of the 3.1 million residents of Orange County, California, we Larry D.Dick President express our sincere appreciation to you on the introduction of your bill, H.R. Wayne S.Osborne 2898 - "The Western Water and American Food Security Act of 2015. " We Vice President applaud your efforts to seek an achievable, long term federal solution to our Brett R. statewide drought. Director g Joan C.Finnegan Director We recognize the difficulties in crafting such legislation and balancing the Susan Hinman needs of the various stakeholders throughout California as well as other Director Sat Tamaribuchl Director western states facing similar issues. Director Jeffery M.Thomas The Municipal Water District of Orange County (MWDOC), a water agency Director serving the needs of more than two million residents and 28 retail water Robert J.Hunter General Manager agencies, voted unanimously to support your legislation and to assist with its passage through the House of Representatives and ultimately become MEMBER AGENCIES "conferenced" with a Senate Bill. City of Brea City of Buena Park On behalf of MWDOC Board of Directors, we are pleased to support H.R. East Orange County Water District 2898 and sincerely thank you for your efforts to address the ongoing drought in El Toro Water District California. Working together towards realistic goals such as those outlined in Emerald Bay Service District H.R. 2898, is the only we will survive the drought and prepare ourselves for City of Fountain Valley City of Garden Grove future droughts. Golden State Water Co. City of Huntington Beach Should you have any questions regarding this matter, please feel free to contact Irvine Ranch Water District either Jim Barker at(202) 413-2986 in Washington, or MWDOC General Laguna Beach County Water District Manager, Rob Hunter at (714) 593-5026. City of La Habra City of La Palma Mesa Water District Sincerely, Moulton Niguel Water District City of Newport Beach ' City of Orange a Orange County Water District City of San Clemente City of San Juan Capistrano Larry D. Dick Santa Margarita Water District Board President City of Seal Beach Serrano Water District cc: Orange County Congressional Delegation South Coast Water District Trabuco Canyon Water District City of Tustin City of Westminster Yorba Linda Water District July 9, 2015 Honorable Edward Royce Washington, DC Office: 2185 Rayburn House Office Bldg. Washington, DC 20515 Dear Congressman Royce, We have attached to this letter, a thank you letter sent to Congressman David Valadao of the Central Valley who has just introduced the The Western Water and American Food Security Act of 2015”. This legislation seeks to find an achievable, long term federal solution to our statewide drought. The Board of Directors of the Yorba Linda Water District (YLWD) has voted unanimously to support H.R. 2892 and we urge you to support this legislation when it comes to the Floor of the House of Representatives. On behalf of the Board and the public we serve, I offer to you our sincere thanks for all that you do for the residents of Orange County. Should you have questions about this issue, please feel free to contact our General Manager, Marc Marcantonio at 714-701-3020, mmarcantonio@ylwd.com. Sincerely, Ric Collett, President Yorba Linda Water District Board of Directors Backup Material Distributed Less Than 72 Hours Prior to the Meeting Backup Material Distributed Less Than 72 Hours Prior to the Meeting July 9, 2015 Honorable David Valadao 1004 Longworth HOB Washington, DC 20515 Dear Congressman Valadao: On behalf of the Yorba Linda Water District in Orange County, CA, we express our sincere appreciation to you on the introduction of HR 2898, The Western Water and American Food Security Act of 2015. We applaud your efforts to seek an achievable, long term federal solution to our statewide drought. We recognize the difficulties in crafting such legislation and balancing the needs of the various stakeholders throughout the State. The Board of Directors for the Municipal Water District of Orange County have voted to support your legislation and to assist with its passage through the House of Representatives and ultimately become "Conferenced" with a Senate Bill. We join them in support of your bill. Thank you for your tireless efforts on behalf of the people of California. Should you have questions about this issue, please feel free to contact our General Manager, Marc Marcantonio at 714-701-3020, mmarcantonio(kylwd.com. Sincerely, Ric Collett, President Yorba Linda Water District Board of Directors cc: Congressman Ed Royce State Senator Bob Huff Assemblywoman Ling Ling Chang Municipal Water District of Orange County ITEM NO. 9.1 AGENDA REPORT Meeting Date: July 9, 2015 To:Board of Directors From:Marc Marcantonio, General Manager Presented By:Marc Marcantonio, General Manager Prepared By:Delia Lugo, Finance Manager Subject:Water and Wastewater Rate Study Review SUMMARY: As authorized by the Board of Directors at the regular meeting held March 25, 2015, the District entered into a Professional Services Agreement with Raftelis Financial Consultants, Inc. (RFC) to conduct a 5-Year Water and Wastewater Rate Study. RFC has worked with staff on acquiring the necessary data to develop the Water and Wastewater Financial Models. These models will be used to develop rate structures that reflect cost of service, promote financial stability, and ensure that the District is in compliance with regulatory requirements. Representatives from RFC will be in attendance to present the models and receive feedback from the Board at the meeting. ATTACHMENTS: Name:Description:Type: RFC_Agenda.docx Backup Material Backup Material RFC_Scope_of_Work.pdf Backup Material Backup Material Rate_Study_Presentation.pdf Backup Material Distributed Less Than 72 Hours Prior to the Meeting Backup Material 201 S. Lake Avenue Suite 301 Pasadena, CA 91101 Phone 626 . 583 . 1894 Fax 626 . 583 . 1411 www.raftelis.com PPPPaaaaggggeeee 1111 MemoMemoMemoMemo To: Delia Lugo, Finance Manager, Yorba Linda Water District From: Sanjay Gaur, Vice President , Raftelis Financial Consultant Date: July 1, 2015 Re: Agenda for Rate Workshop with District Board Agenda for Rate Workshop with District Board 1. Rate Study Process Overview 2. Policy Discussions a. Financial Policy / Reserve Policy b. Pass-through Water Supply Costs c. Water Fixed Charges / Commodity Revenue Structure 3. Financial Plan Development a. Water i. Status Quo with Drought Sales and Pass-through Water Supply Costs ii. Proposed with Drought Sales and Pass-through Water Supply Costs b. Sewer 4. Cost of Service Analysis, Rates and Customer Impacts a. Water b. Sewer 201 S. Lake Avenue Suite 301 Pasadena, CA 91101 Phone 626 . 583 . 1894 Fax 626 . 583 . 1411 www.raftelis.com Page 1 March 12, 2015 Delia D. Lugo Finance Manager Yorba Linda Water District 1717 E. Miraloma Avenue Placentia, CA 92870 Subject: Scope of Services for 2015 Water and Wastewater Rate Study Dear Ms. Lugo: Raftelis Financial Consultants, Inc. (RFC) is pleased to submit this scope of service for the 2015 Water and Wastewater Rate Study (Study) for the Yorba Linda Water District (District). Below, are the proposed tasks and fees. Scope of Service Task 1 – Kick-off and Policy Discussion Workshop with Staff The Kick-off Workshop provides a solid foundation for the project and ensures that project participants are in mutual agreement as to the project goals, expectations, and other important recently surfacing issues for the District. RFC will develop a project initiation package that contains the meeting agenda and presentation materials to guide the discussion. A data request will be submitted to the District promptly following receipt of the notice-to-proceed. Data requests may include, but are not limited to, the following information: Financial data such as operating budgets, revenue sources (including non-operating revenues), capital improvement plans (CIP), growth assumptions, and reserve funds Official statements for existing debt Historical accounts by meter size and water use by customer class for fiscal year (FY) 2013/14 During the workshop, RFC will discuss the reserve policies and develop recommendations for appropriate reserve levels that are consistent with industry standards as well as the District’s practices related to maintaining system reliability for each of its enterprises. The proposed financial policies will be used to develop the financial plan. Meetings: One (1) Kick-off Workshop with Staff Deliverables: Data request list, presentation material for the Workshop in Microsoft PowerPoint™ 2013 Scope of Services for 2015 Water and Wastewater Rate Study Yorba Linda Water District Page 2 Task 2 – Financial Plan Development for Water and Wastewater Enterprises RFC will develop forecasts of revenue requirements for the Water and Wastewater enterprises over the planning horizon. This will include an estimate of revenues based on current rates, usage characteristics, and other non-operating revenues. Revenue requirements will be projected based on historical results, the current budget, (CIP), existing debt service and other bond compliance requirements, other obligations and current economic trends. Projecting revenue adjustments over a longer planning horizon can illustrate future rate impacts and potential challenges to the District’s financial situation and allow the District to make adjustments to expenses, reserve balances, or capital projects scheduling to smooth rate impacts and maintain financial stability. RFC will develop a separate Financial Plan Model for the Wastewater enterprise and update the previously developed Water Financial Plan Model (current Water Model) with the FY 2016 budget and updated water supply costs, capital expenditure plans, and fund balances from the District to reflect the District’s current financial status. The recommended revenue adjustments and resultant customer impacts will be provided to assist the District in making informed decisions. Meetings: None Deliverables: Updated Water Financial Plan Model in Microsoft Office Excel™ 2013 and Wastewater Financial Plan Model in Microsoft Office Excel™ 2013 Task 3 – Water and Wastewater Rate Model Development The District expressed interests in evaluating the increases in fixed revenues to enhance water revenue stability. RFC will develop the Rate Model to have the ability to calculate the 5-year water rates with the ability to increase fixed revenues to the desired level over the planning period. Similarly, wastewater rates will also be calculated in the Model for the 5-year study period to sufficiently recover the revenue requirements determined by the Financial Plan developed in Task 2. It is assumed that the District will maintain its current water and wastewater rate structures; uniform commodity rate for water services and flat fixed service charges for residential wastewater services, and fixed and variable charges for non-residential wastewater services. The Model will also have the built-in capability to conduct various scenario analyses and to calculate the rates under each scenario. The Dashboard, which displays key variables and results in real-time on-screen, will facilitate discussion to reach a consensus quickly. This has proven to be particularly useful when making presentations to District Board members and various stakeholder groups, allowing them instantly to appreciate the impacts of their decisions fully. RFC will also determine the potential financial impact on customers that may result from the proposed rate structure. The model will include a series of tables and figures that show projected rate impacts on different types of customers at various levels of usage. Meetings: None Deliverables: Water and Wastewater Rate Model in Microsoft Office Excel™ 2013 Scope of Services for 2015 Water and Wastewater Rate Study Yorba Linda Water District Page 3 Task 4 – Financial Plan and Rate Design Workshops with District Staff and Board Members Following the completion of the Financial Plan and Rate Model, RFC will hold Financial Plan and Rate Design Workshops with District Staff to develop different financial plan and rate scenarios. The first workshop will be conducted with the goal of developing the financial plan for the Water and Wastewater enterprises for the Study period. In the second workshop, RFC will present the interim proposed rates and discuss the benefits and challenges associated with each proposed rate scenario, demonstrated through the Rate Model. Changes and suggestions from staff will be incorporated into the analyses prior to presenting the final results to the District Board. The last workshop will be with the Board, where staff and RFC will present the recommended rate structure. This will be an opportunity for the Board to provide suggested changes / comments. Meetings: Two (2) on-site Workshops with District Staff and one (1) Workshop with the Board Deliverables: presentation materials for the Workshop in Microsoft PowerPoint™ 2013 Task 5 – Report Development The process for developing the proposed rates will be described in a draft report. This draft report will include an executive summary highlighting the major issues and decisions and an overview of operations, CIP, the financial plan, and the final rates resulting from the Study. The report will also include a rate and fee survey of five comparable water agencies. RFC has extensive experience conducting local rate surveys as part of our other rate studies, benchmarking studies, and our Water and Wastewater Rate Survey, a national biennial water and wastewater rate survey conducted by RFC in association with AWWA. Comments from District Staff on the survey and draft report will be incorporated into the Final Report as appropriate, and the Model will be refined to reflect appropriate issues or concerns raised by stakeholders. The Final Report will be submitted to the District and will include appropriate supporting data from the Model to address the requirements of Proposition 218. Meetings: One (1) conference call to review the Draft Report Deliverables: Draft Report, Final Report in Microsoft Word ™ 2013 and PDF Task 6 – Public Hearing and Proposition 218 Process RFC has assisted numerous agencies with the Proposition 218 process and will be available to assist the District with public education and guiding the District through elements of the Proposition 218 process such as reviewing the Proposition 218 notice. RFC will be present at the Public Hearing to adopt the recommended rates and will be available to answer any questions. Meetings: One (1) Public Hearing Deliverables: presentation materials for the Public Hearing in Microsoft PowerPoint™ 2013 Scope of Services for 2015 Water and Wastewater Rate Study Yorba Linda Water District Page 4 Fees and Hours RFC proposes to complete the scope of work outlined on a time-and-materials basis with a not-to-exceed cost of $50,000. The following work plan provides a breakdown of the estimated level of effort required for completing each task as described and the hourly billing rates for the personnel scheduled to complete the project. SG FC Total 1 Kick-off and Policy Discussion Workshop with Staff 1 8 8 16 $3,992 2 Financial Plan Development for Water and Wastewater Enterprises 10 40 50 $10,800 3 Water and Wastewater Rate Model Development 9 20 29 $6,520 4 Workshops with District Staff and Board Members 3 30 30 60 $14,856 5 Report Development 8 40 48 $10,240 6 Public Hearing and Proposition 218 Process 1 8 6 14 $3,592 5 73 144 217 270 $190 Legend:$47,070 SG = Sanjay Gaur (Vice President)$2,930 FC = Financial Consultant (Sr. Consultants)$50,000TOTALFEES & EXPENSES Yorba Linda WD Rate Study Proposed Hours and Fees TOTAL ESTIMATED MEETINGS / HOURS HOURLY RATES Total Fees & ExpensesTaskDescriptionsTask No HoursRequirementsNoof Meetings Total Professional Fees Estimated Expenses Scope of Services for 2015 Water and Wastewater Rate Study Yorba Linda Water District Irk We appreciate the opportunity to submit this proposal and look forward to assisting the District with this project. If you have any questions or need additional information, please contact me at(213) 327-4405 or Khanh Phan at (626) 233-6762. Respectfully submitted, Accepted by: RAFTELIS FINANCIAL CONSULTANTS, INC. YORBA LINDA WATER DISTRICT By: By: „2%.A C Sanjay Gaur Vice President Title: General Manager Date: April 1, 2015 -- Page 5 — Backup Material Distributed Less Than 72 Hours Prior to the Meeting 2015 Water and Sewer Rate Study Yoram Linda Water f i ri RATE WORKSHOP WITH DISTRICT BOARD R0.F7EL15 JULY 91 2015 Fiw�coksuun*s.me Backup Material Distributed Less Than 72 Hours Prior to the Meeting 19 Yfjrba Linda Water District Agenda Rate Study Process Overview Policy Discussions Financial Policy / Reserve Policy Pass-through Water Supply Costs Water Fixed Charges / Commodity Revenue Structure Financial Plan Development Water Status Quo with Drought Sales and Pass-through Water Supply Costs Proposed with Drought Sales and Pass-through Water Supply Costs Sewer Cost of Service Analysis, Rates and Customer Impacts o Water Sewer WATER Jul 9, 2015 2015 ; SEWER RATE STUDY - RATE WORKSHOP WITH DISTRICT BOARD 2 Backup Material Distributed Less Than 72 Hours Prior to the Meeting Yorba Linda Water Vistrict Rate Study at A Glance Final Rate Adoption Financial Plan O • Report • Evaluation of CIP and Cost of Service & • Prop 218 Notice financing options Rate Design • Public Hearing • Cash flow analysis for financial sufficiency • Cost Allocations • Rate Design C) • Rate Calculations • Customer Impact Analyses Jul 9, 2015 2015 WATER & SEWER RATE STUDY - RATE WORKSHOP WITH DISTRICT BOARD 3 Backup Material Distributed Less Than 72 Hours Prior to the Meeting Yfjrba Linda Water District Financial Plan Development Revenue Expenses Operating • : • . - . . . D- � _ Revenue Adjustment Schedule . Financial Jul 9, 2015 2015 WATER & SEWER RATE STUDY - RATE WORKSHOP WITH DISTRICT BOARD 4 Backup Material Distributed Less Than 72 Hours Prior to the Meeting 19 Yfjrba Linda Water District Obj* ect*ives of the Study I Develop 5-year Financial Plan for Water and Sewer Enterprises 2 . Calculate the Water and Sewer Rates 3 . Develop an administrative record that demonstrates "nexus requirements" between cost to provide service and rates for water and sewer Jul 9, 2015 2015 WATER & SEWER RATE STUDY - RATE WORKSHOP WITH DISTRICT : , . . , Backup Material Distributed Less Than 72 Hours Prior to the Meeting Yfjrba Linda Water District Policy Discussion FINANCIAL POLICY / RESERVE POLICY PASS -THROUGH WATER SUPPLY COSTS WATER FIXED CHARGES / COMMODITY REVENUE STRUCTURE WATER Jul 9, 2015 2015 ; RATE WORKSHOP WITH DISTRICT BOARD 6 Backup Material Distributed Less Than 72 Hours Prior to the Meeting Yorba Linda Water Vistrict Risk Assessment According to Donald Rumsfeld Things you Things you Things you know you don' t don't know you know know don't know No Risk Known Risk Unknown Risk >) Jul 9, 2015 2015 WATER & SEWER RATE STUDY - RATE WORKSHOP WITH DISTRICT BOARD Backup Material Distributed Less Than 72 Hours Prior to the Meeting Yorba Linda Water Vistrict Financial Polices i Overview Goals of Financial Policies To mitigate risk Rate / Revenue instability Emergency with asset failure Volatility in working capital To achieve/maintain a certain credit rating To determine most opportune time to issue debt Jul 9, 2015 2015 WATER & SEWER RATE STUDY - RATE WORKSHOP WITH DISTRICT BOARD 8 Backup Material Distributed Less Than 72 Hours Prior to the Meeting Yorba Linda Water Vistrict Financial Polices i Overview Importance of Financial Policies To maintain financial solvency Provide a basis for coping with fiscal emergencies (revenue short-falls, asset failure, emergency etc. ...) To provide guidelines for sound financial management with an overall long-range perspective To enhance financial management transparency Improve public's confidence and elected officials' credibility Jul 9, 2015 2015 WATER & SEWER RATE STUDY - RATE WORKSHOP WITH DISTRICT BOARD Backup Material Distributed Less Than 72 Hours Prior to the Meeting 19 Yfjrba Linda Water District Why Do We Need Reserves .? Nature of municipal utility system Capital intensive Highly fluctuating capital costs Risk and liability 4 unknown liability costs Healthy reserve level 4 better credit ratings 4 lower interest rates for future debt Jul 9, 2015 2015 WATER & SEWER RATE STUDY - RATE WORKSHOP WITH DISTRICT BOARD 10 Backup Material Distributed Less Than 72 Hours Prior to the Meeting Yorba Linda Water Vistrict Financial Reserve Balances : Operation Reserve: to meet daily working capital for operating expenses Rate Stabilization Reserve: to be used during periods of short-term revenue shortages to prevent rate-shock and phase in any necessary rate adjustments Capital Replacement Reserve: for future CIP expenditures Emergency Reserve: funds available in case of asset failure or natural disaster Other Restricted Reserves: to mitigate other known risks such as debt service, employees benefit liability (EBL) Debt Coverage Ratios To meet Official Statement requirements To achieve credit ratings from rating agencies WATER Jul 9, 2015 2015 ; SEWER RATE STUDY - RATE WORKSHOP WITH DISTRICT BOARD 11 Backup Material Distributed Less Than 72 Hours Prior to the Meeting Ybrba Linda in 'Mater District Factors to Consider Policy Billing frequency Bi-monthly billing requires higher reserve than monthly billing Automatic pass-through of water and power costs Lower water cost volatility 4 lower reserve requirements Long-term CI P More fluctuating capital costs 4 more reserves Revenue volatility More volatile revenue 4 more reserves Other risk management: asset failure, debt etc. Reserves for replacement for critical asset failure? Reserves for debt coverage requirements during drought years? WATER Jul 9, 2015 2015 ; SEWER RATE STUDY - RATE WORKSHOP WITH DISTRICT BOARD Backup Material Distributed Less Than 72 Hours Prior to the Meeting Yfjrba Linda Water District Current i na ncia o is Reserves""""""""""""'" Water Ef-F w- -A Operations 12% of O&M 12% of O&M Emergency $1M $1M Capital Replacement $2.02M $345K ($1.82M Capital + $200K for Maintenance) $4.87M COP/ Debt Service ($2.15M for 2008 COP Reserve + $2.72M $0 for Debt Service) Employee Benefit $182K $15K Liability (EBL) Debt Coverage 1. 10x N/A By Official Statement Jul 9, 2015 2015 WATER & SEWER RATE STUDY - RATE WORKSHOP WITH DISTRICT BOARD 13 Backup Material Distributed Less Than 72 Hours Prior to the Meeting Yorba Linda Water Vistrict Recommended Water Reserve Policy Operations 25% of O&M 25% of O&M Rate Stabilization 15% of Commodity Revenues N/A Emergency $10M $31VI for major repair of critical assets for major repair of critical assets Capital 2% of asset value by replacement 2% of asset value by replacement Replacement costs costs COP/ Debt 100% of annual total debt service 100% of annual total debt service Service + $2.147M 2008 COP Restricted Employee Benefit Based on District's projections Based on District's projections Liability (EBL) Debt Coverage 1.25x for Good standing per S&P 1.25x for Good standing per S&P rating criteria rating criteria Backup Material Distributed Less Than 72 Hours Prior to the Meeting Yorba Linda Water Vistrict Recommended FY 2015 Targe, Reserve Policy Operations $6.03M $358K Rate Stabilization $3.31M N/A Emergency $10.00M $3,000K Capital Replacement $7.05M $1,915K COP/ Debt $4.87M Dbt Service ($2.15M for 2008 COP Reserve + N/A $2.72M for Debt Service) Employee Benefit Liability $0.27M $15K (EBL) Total Proposed Target $31.53M $5,288K Ending Balances FY 2015 $28.95M $3,704K Current Target $11.06M $1,532K Jul 9, 2015 2015 WATER & SEWER RATE STUDY - RATE WORKSHOP WITH DISTRICT BOARD Backup Material Distributed Less Than 72 Hours Prior to the Meeting Yfjrba Linda 'Mater.pis#rict Passmthrough Water Supply Costs Discussion Current Challenges : Uncertainty with water supply costs How MWD will pass-through their costs to member agencies? Current drought conditions can have a significant impact on MWD Will OCWD change the BPP due to the water basin level? How much will OCWD raise their RA? Should the District continue to pass-through water supply costs? Pro: Ability to mitigate the uncertainty and unknown increases in water supply costs Con : Future rates are not provided, lack of transparency Jul 9, 2015 2015 ; STUDY DISTRICT BOARD e Backup Material Distributed Less Than 72 Hours Prior to the Meeting 19 Yfjrba Linda Water District Water Cost and Revenue Structure 2016 Water Cost and Revenue Structures 100% - 90 $0% Variable, i 70% 60% Variable, 50% 40% 30% Fixed, 57% 20% 10% Fixed,f 0% 2016 Costs 2016 Revenues from Current Rates ➢ How Much Should Fixed Service Charges Recover? Jul 9, 2015 2015 WATER & SEWER RATE STUDY - RATE WORKSHOP WITH DISTRICT BOARD 17 Backup Material Distributed Less Than 72 Hours Prior to the Meeting Yfjrba Linda Water District Financial Plan Development WATER SEWER WATER Jul 9, 2015 2015 ; RATE WORKSHOP WITH DISTRICT BOARD 18 Backup Material Distributed Less Than 72 Hours Prior to the Meeting Yfjrba Linda Water District Water Financial Plan Drought Sales in FY 2016 = 13,298 AF (36% of 2013 Sales) Projected Sales 20,000 AF 18,000 AF 16,000 AF 14,000 AF 12,000 AF 10,000 AF 8,000 AF 6,000 AF 4,000 AF 2,000 AF OAF FY 2015 FY 2016 FY 2017 FY 2018 FY 2019 FY 2020 ■Drought Sales 18,752 AF 13,298 AF 14,581 AF 15,623 AF 16,664 AF 17,706 AF Jul 9, 2015 2015 WATER & SEWER RATE STUDY - RATE WORKSHOP WITH DISTRICT BOARD Backup Material Distributed Less Than 72 Hours Prior to the Meeting Yfjrba Linda Water District Status Quo Water Financial Plan Drought Sales with Pass-through Water Supply Costs Water Revenue Adjustments& Coverage Chart <00 Water Revenue Adjustments and 100.°°'° ' Debt Coverage 30.0% • 60.D% ➢ Blue bars — Proposed Revenue Adjustment (left 40.0`Yo 46% 37,0 30% % axis) (No Revenue Adjustment) 50% 20.0% zz% / --♦ ° ➢ Red line —Target debt coverage 125% r_ 0.0% 0W�0.0% 0.0% 0.0% ° wrl. -50% ➢ Dark green line — Projected debt coverage (right FY 2015 FY 2016 FY 2017 FY 2013 FY 2019 Coverage Rev Adj axis) �RevAdj Cove,ageRatio —Required Cove rage-125% • Alert Coverage ➢ Red dot —Alert coverage when falling below target Millions Total Water Reserve Ending Balances $40 $35 $29 $25 $21 Projected Reserve Balances $20 $13 $15 $10 0 A $5 $1 ➢ e bars — Projected ending reserve balances $0 ➢ Green line —target balances for Water reserves -$s -$10 ➢ Red dot — alert balances when ending balances FY 2015 FY 2016 FY 2D17 FY 2018 FY 2019 fall below target levels �Ending3alances —Minimum O Alert Balances Jul . 2015 2015 WORKSHOP WITH DISTRICT • 20 Backup Material Distributed Less Than 72 Hours Prior to the Meeting Yfjrba Linda Water.District Status Quo Water Financial Plan Drought Sales with Pass-through Water Supply Costs Water Operating Financial Plan 0 Operating Financial Plan $20 ➢ Lines — revenues $0 ➢ Red — current rates $20 ➢ Green — proposed rates FY 2015 FY 2016 FY 2017 FY 2018 FY 2019 ➢Stacked bars - expenses OYLWD O&M �WaterCost r O Debt Service&LOC Principal Non-Operating Res Funning —Current Rev Pro osed Rev Water CIP and Funding Sources N $Y o $6 Water CIP & Funding Sources $5 $4 $3 ➢ Green bar— PAYGO $2 V, $1 ➢ Purple bar — New Debt (by Line of Credit $o m M (LOC)) FY 2015 FY 2016 FY 2017 FY 2018 FY 2019 ■Debt Funding N PayGo Jul 9, 2015 2015 WATER & SEWER RATE STUDY - RATE WORKSHOP WITH DISTRICT BOARD 21 Backup Material Distributed Less Than 72 Hours Prior to the Meeting Ydrba Linda Water District Status Quo Water Financial Plan Drought Sales with Pass-through Water Supply Costs Water Revenue Adjustments&Coverage Chart Water Operating Financial Plan 100.0% 300% Lo $40 80.000/a 250% O 200% $20 60.0% 150% 40.0% 0 100% $0 46/0 37% 30% $20'/0 20.0% -22% 50 0 0.0% 0 0.0% 0.0% 0.0% 0% FY 2015 FY 2016 FY 2017 FY 2018 FY 2019 0.a� , -50% Rev Adj FY 2015 FY 2016 FY 2017 FY 2018 FY 2019 Coverage OYLWD O&M 111111111111111lWater Cost ODebt service&LOC Principal I Non-Operating 11111111111111111111lRevAdj --*—Coverage Ratio —Required Coverage-125% • Alert Coverage Res Funding —Current Rev —Pro used Rev Millions Total Water Reserve Ending Balances Water CIP and Funding Sources $40 $35 $29 v $7 $30 - o $6 $25 $21 $20 $13 $5 $15 $4 $10 $3 $5 $1 $2 $0 _ IL 5 -$5 � $1 -$10 $0 FY 2015 FY 2016 FY 2017 FY 2018 FY 2019 FY 2015 FY 2016 FY 2017 FY 2018 FY 2019 Ending Balances —Minimum o Alert Balances ■Debt Funding -PayGo Jul . 2015 2015 WATER & SEWER RATE STUDY - RATE WORKSHOP WITH DISTRICT BOARD 22 a Backup Material Distributed Less Than 72 Hours Prior to the Meeting Yfirba Linda Water Vistrict Proposed Financial Plan Drought Sales with Pass-through Water Supply Costs Water Revenue Adjustments& Coverage Chart Water Revenue Adjustments and 40-0% - 36.0% �. 600° Debt Coverage 35.0% 500% 30.0% _----- 25.0% �` _ 400% zo.o% 300,0 ➢ Blue bars — Proposed Revenue Adjustment (left 15.0% 200% axis) (36% in FY 2016 and 5% in FY 2017— FY 2019) 10.0% 0/o 0. o ➢ Red line —Target debt coverage 125% 5.0.0 0 100/a 0.0.0/0 0% ➢ Dark green line — Projected debt coverage (right FY 2015 FY 2016 FY 2017 FY 2018 FY 2019 Coverage axis) Rev Adj 1111111111111111111111lRevAdj --*—Coverage Ratio —Required Coverage-125% • Alert Coverage ➢ Red dot —Alert coverage when falling below target Millions Total Water Reserve Ending Balances $40 $35 $29 $27 $28 Projected Reserve Balances $75 $20 $15 ➢ Red bars — Projected ending reserve balances $10 ➢ Green line —target balances for Water reserves $0 ➢ Red dot — alert balances when ending balances 1Y 2015 FY 2016 FY 2011 FY 2018 1Y 1015 fall below target levels Ending Balances —Minimum o Alert Balances WORKSHO WITH DISTRICT BOARD 23 Jul 9, 2015 2015 WATER & SEWER RATE STUDY - RATE • Backup Material Distributed Less Than 72 Hours Prior to the Meeting Yfirba Linda Water District Proposed Financial Plan Drought Sales with Pass-through Water Supply Costs Water Operating Financial Plan 0 $60 Operating Financial Plan $4O ➢ Lines — revenues $20 ➢ Red — current rates $0 ➢ Green — proposed rates FY 2015 FY 2016 FY 2017 FY 2018 FY 2019 ➢Stacked bars - expenses OYLWD O&M Water Cost O Debt Service&LOC Principal Non-Operating Res Funning —Current Rev Pro osed Rev Water CIP and Funding Sources N $7 o $6 Water CIP & Funding Sources $5 $4 $3 ➢ Green bar— PAYGO $2 V, $1 ➢ Purple bar — New Debt (by Line of Credit $o m M (LOC)) FY 2015 FY 2016 FY 2017 FY 2018 FY 2019 ■Debt Funding N PayGo Jul 9, 2015 2015 WATER & SEWER RATE STUDY - RATE WORKSHOP WITH DISTRICT BOARD 24 Backup Material Distributed Less Than 72 Hours Prior to the Meeting Ydrba Linda Water Vistrict Proposed Financial Plan Drought Sales with Pass-through Water Supply Costs Water Revenue Adjustments&Coverage Chart Water Operating Financial Plan 40.0% 36.0% 600% $60 35.0% - 500% O 30.0% - - -_ - $40 25.0% ♦- 400% 20.0% 300% $20 15.0% 200% F7=1! 10.0% o 1.QV4 % $0 I I 1 1 5.0% 0.0% _ 100% FY 2015 FY 2016 FY 2017 FY 2018 FY 2019 0.0% -i 0% Rev Adj FY 2015 FY 2016 FY 2017 FY 2018 FY 2019 Coverage OYLWD O&M 1111111111111111lWater Cost ODebt Service&LOC Principal Non-Operating 1111111111111111lRevAdj --*-Coverage Ratio —Required Coverage-125% • Alert Coverage il11111111111111lRes Funding —Current Rev —Pro used Rev Millions Total Water Reserve Ending Balances Water CIP and Funding Sources $40 $7 $30 $29 $27 $28 $28 0 $6 $25 $5 $20 $a $15 $3 $10 $2 $5 $1 $0 $0 - FY 2015 FY 2016 FY 2017 FY 2018 FY 2019 FY 2015 FY 2016 FY 2017 FY 2018 FY 2019 Ending Balances —Minimum o Alert Balances ■Debt Funding PayGo Jul . 2015 2015 WATER & SEWER RATE STUDY - RATE WORKSHOP WITH DISTRICT BOARD 25 a Backup Material Distributed Less Than 72 Hours Prior to the Meeting Yfjrba Linda Water District Status Quo Sewer Financial Plan Sewer Revenue Adjustments& Coverage Chart Sewer Revenue Adjustments and 100.0% T 1 Debt Coverage so.o°%° 1zo°o 100% 60.0°x° 8Mo ➢ Blue bars — Proposed Revenue Adjustment (left 40.0% 60% axis) (No increases) 20.0% 40%20.x° ➢ Red line —Target debt coverage 125% 0.00/0 0.0% °_c% ""% 0"°� °.n% ➢ Dark green line — Projected debt coverage (right Rev Adj FY 2016 FY 2017 FY 2018 FY 2019 FY 2020 Coverage axis) (No proposed debt) ➢ Rate Adjustments -Debt Coverage Red dot — Alert coverage when falling below Target Coverage 125% • Alert Coverage target Total Sewer Reserve Ending Balances $6.0 $5'0 Projected Reserve Balances $3.0 $4.0 $3.3 735 $3.6 $3.5 $3.0 $20 ➢ Red bars — Projected ending reserve balances $1.0 ➢ Green line —target balances for Sewer reserves $0.0 ➢ Red dot — alert balances when ending balances FY 2016 FY 2017 FY 2018 FY 2019 FY 202C fall below target levels �Endin;Balances —Target Balances z) Alert Balances Jul 9, 2015 2015 WATER & SEWER RATE STUDY - RATE WORKSHOP BOARD 26 Backup Material Distributed Less Than 72 Hours Prior to the Meeting Yfirba Linda Water District Status Quo Sewer Financial Plan Sewer Operating Financial Plan $2'0 0 Operating Financial Plan $1.5 ➢ Lines — revenues $1.0 ➢ Red — current rates $0.5 ➢ Green — proposed rates $0.0 ➢Stacked bars - expenses 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 $0.69 $0J Sewer CIP & Funding Sources $0.5 $0.4 $0.3 $0.21 $0.22 $0.22 $0.23 ➢ Green bar— PAYGO $0.2 0 ➢ Purple bar — New Debt (None) $0.1 $0.0 ; ➢ Blue dot —Total CIP (inflated by CCI) FY 2016 FY 2017 FY 2018 FY 2019 FY 2020 ■Debt/Loan Funded ■PAYGO •Total CIP Jul . 2015 WORKSHOP WITH DISTRICT BOARD 27 Backup Material Distributed Less Than 72 Hours Prior to the Meeting Yorba Linda Water District Status Quo Sewer Financial Plan Sewer Revenue Adjustments& Coverage Chart Sewer Operating Financial Plan 100.09/. 110% c $Z.0 80.0% 120% o 100% $1.5 60.0% 80' $1.0 40.0% 600A $o 400/3 $0.5 20.0% 0.0% o.0°i 0.0% o.o°i 0.0°io 200/ $0.0 0.0'Y. 0% FY 2016 FY 2017 FY 2018 FY 2019 FY 2020 RevAdj FY 2016 FY 2017 FY 2018 FY 2019 FY 2020 coverage Salary Related Expenses liiiiiiiiiiiiiiiiiiiili0ther Expenses Debt Service Rate Adjustments -Debt Coverage i�Reserve Funding -Current Revenues -Proposed Revenues -Target Coverage 125% • Alcrt Coverage Total Sewer Reserve Ending Balances Sewer CIP and Funding Sources $6.0 H $0.8 $0.69 $5.0 o $0.7 $4.0 $3.3 $3.5 $3.6 $3.5 $0.6 $3.0 $0.5 $3.0 $0.4 $2.0 $0.3 $0.21 $0.22 $0.22 $0.23 $1.0 $0.1 $0.0 $0.0 FY 2016 FY 2017 FY 2018 FY 2019 FY 2020 FY 2016 FY 2017 FY 2018 FY 2D19 FY 2020 Ending Balances -Target Balances O Alert Balances ■Debt/Loan Funded ■PAYGO •Total CIP Jul 9, 2015 2015 WATER & SEWER RATE STUDY - RATE WORKSHOP BOARD 28 Backup Material Distributed Less Than 72 Hours Prior to the Meeting Yfirba Linda Water District Proposed Financial Plan Sewer Revenue Adjustments& Coverage Chart Sewer Revenue Adjustments and 10.0% 1 Debt Coverage 8.0.0/ 120% 0% 8.0% 8.0% 8.0% 8.0% 100% 6.0% 80% ➢ Blue bars — Proposed Revenue Adjustment (left 4.0% 60% axis) (8 percent per year) 2.0% 20% ➢ Red line —Target debt coverage 125% 000/0 _ 0% ➢ Dark green line — Projected debt coverage (right Rev Adj FY 2016 FY 2017 FY 2018 FY 2019 FY2020 Coverage axis) (No proposed debt) ➢ Red dot —Alert coverage when falling below Rate Adjustments -Debt Coverage Target Coverage 125% • Alert Coverage target Total Sewer Reserve Ending Balances $7.0 $60 $5.0 Projected Reserve Balances 2 $5.0 $ $3.7 4.3 $4.0 $3.1 $3.0 ➢ Red bars — Projected ending reserve balances $2-0 ➢ Green line —target balances for Sewer reserves $1.0 $0.0 ➢ Red dot — alert balances when ending balances FY 2016 FY 2017 FY 2018 FY 2019 FY2020 fall below target levels 111111111M Ending Balances —Target Balances o Alert Balances Jul 9, 2015 2015 WATER & SEWER RATE STUDY - RATE WORKSHOP WITH DISTRICT BOARD 29 all Backup Material Distributed Less Than 72 Hours Prior to the Meeting Yfirba Linda Water District Proposed Financial Plan Sewer Operating Financial Plan $3'0 - Operating Financial Plan $2.5 $2-0 ➢ Lines — revenues $1.5 ➢ Red — current rates $1.0 ■ . . $0.5 ➢ Green — proposed rates $0.0 ➢Stacked bars - expenses 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 $0.69 $0.7 Sewer CIP & Funding Sources $0.6 $0.5 $0.4 $0.3 $0.21 $0.22 $0.22 $0.23 ➢ Green bar— PAYGO $0.2 0 ➢ Purple bar — New Debt (None) $0.1 - 0 $0.0 , I Blue dot —Total CIP (inflated by CCI) FY 2016 FY 2017 FY 2018 FY 2019 FY 2020 ■Debt/Loan Funded ■PAYGO •Total CIP Jul . 2015 2015 WORKSHOP WITH DISTRICT • 30 Backup Material Distributed Less Than 72 Hours Prior to the Meeting Ybrba Linda Water District Proposed Financial Plan Sewer Revenue Adjustments& Coverage Chart Sewer Operating Financial Plan 10.0% 140% 14 $3.0 120% ° $2.5 8.0•� 8.0% . .. 100% � 2 $2.0 6.0% 80• $1.5 4.0% fi00A $1.0 40% $0.5 ■ 20`% $0.0 0A% 0% FY 2016 FY 2017 FY 2018 FY 2019 FY 2020 FY 2016 FY 2017 FY 2018 FY 2019 FY 2020 ev Adj Coverage i Salary Related Expenses Other Expenses Debt Service s,Rate Adjustments o -Debt Coverage Reserve Funding -Current Revenues -Proposed Revenues Target Coverage 125/0 Alert Coverage Total Sewer Reserve Ending Balances Sewer CIP and Funding Sources $7.0 c .n $0.8 $6.0S,U o_ $0.7 • :1 $5.0 $4.3 $0.6 $40 $3.7 $3.1 $0.5 i $3.0 $0.4 $2.0 $0.3 $0.21 $0.22 $0.22 $0.23 $0.2 • $0.0 $0.0 FY 2016 FY 2017 FY 2018 FY 2019 FY 2020 FY 2016 FY 2017 FY 2018 FY 2019 FY 2020 Ending Balances -Target Balances Alert Balances ■Debt/_oan Funded ■PAY60 • lotal UP Jul 9, 2015 2015 WATER & SEWER RATE STUDY - RATE . • DISTRICT BOARD n Backup Material Distributed Less Than 72 Hours Prior to the Meeting Yfjrba Linda Water District f S Cost o ervice • Analyseis Customer Impacts WATER SEWER WATER Jul 9, 2015 2015 ; SEWER RATE STUDY - RATE WORKSHOP WITH DISTRICT BOARD 32 Backup Material Distributed Less Than 72 Hours Prior to the Meeting Yfjrba Linda Water District Nexus Requairements on Rates Prop 218 requirements • Nexus between rates & cost of service • Examples • Existing water supply costs • Conservation program costs • Potential new sources of supply • Peaking cost of capital Jul 9, 2015 2015 WATER & SEWER RATE STUDY - RATE WORKSHOP WITH DISTRICT : , . . , Backup Material Distributed Less Than 72 Hours Prior to the Meeting 19 Yfjrba Linda Water District Cost of ervice Allocat*ion j ;00 h--Z C% � G SUPPLY BASE PEAKING METER CUSTOMER Fire Jul 9, 2015 2015 WATER & SEWER RATE STUDY RATE WORKSHOP WITH DISTRICT BOARD 34 Backup Material Distributed Less Than 72 Hours Prior to the Meeting 19 Yfirba Linda Water District Water Cost and Rate Components Meter Charges Commodity Rates FY 2016A Billing & CS Capacity • • Power Water Supply $10,677,006 $10,677,006 Power $1,403,404 $1,403,404 Base Fixed $6,258,108 $4,755,527 $1,502,581 Peaking $8,217,530 $6,244,489 $1,973,041 Billing &CS $993,798 $993,798 Meter $717,757 $717,757 Total $28,267,603 $993,798 $11,717,774 $10,677,006 $1,403,404 $3,475,622 Annualized Projected Current Proposed Revenues for 1 Meter Charges $5,144,707 $12,711,572 147% Commodity Rates $15,640,295 $15,556,031 0% Total $20,785,002 $28,267,603 36% of Fixed (25% Fixed) (45% Fixed) Ju19, 2015 2015 WATER & SEWER RATE STUDY - RATE WORKSHOP WITH DISTRICT BOARD 35 Backup Material Distributed Less Than 72 Hours Prior to the Meeting 19 Yfjrba Linda Water District Water Rate Components Capacity Meter Size # of Meters Billing & CS I Proposed 5/8 28 $3.37 / mo $22.92 / mo $26.29 / mo 3/4 5,617 $3.37 / mo $22.92 / mo $26.29 / mo 1 17,271 $3.37 / mo $38.20 / mo $41.57 / mo 11/2 573 $3.37 / mo $76.40 / mo $79.77 / mo 2 1,138 $3.37 / mo $122.24/ mo $125.61 / mo 3 6 $3.37 / mo $267.40/ mo $270.77 / mo 4 4 $3.37 / mo $481.32 / mo $484.69 / mo 6 1 $3.37 / mo $1,222.40/ mo $1,225.77 / mo 8 0 $3.37 / mo $2,139.20/ mo $2,142.57 / mo 10 0 $3.37 / mo $3,208.80/ mo $3,212.17 / mo Water Supply Power hjL— Delivery Proposed Commodity Rates $1.85 $0.25 $0.60 $2.70 / hcf Jul 9, 2015 2015 WATER & SEWER RATE STUDY - RATE WORKSHOP WITH DISTRICT BOARD 36 Backup Material Distributed Less Than 72 Hours Prior to the Meeting Yfirba Linda 'I+w+'ater District Water Rate Components Meter Size Current Proposed % Change 5/8 $10.06 / mo $26.29 / mo $16.23 161% 3/4 $10.06 / mo $26.29 / mo $16.23 161% 1 $16.77 / mo $41.57 / mo $24.80 148% 11/2 $33.54 / mo $79.77 / mo $46.23 138% 2 $53.66 / mo $125.61 / mo $71.95 134% 3 $117.37 / mo $270.77 / mo $153.40 131% 4 $211.26 / mo $484.69 / mo $273.43 129% 6 $469.47 / mo $1,225.77 / mo $756.30 161% 8 $804.80 / mo $2,142.57 / mo $1,337.77 166% 10 $1,274.27 / mo $3,212.17 / mo $1,937.90 152% Proposed ' Change Commodity Rates $2.70 / hcf $2.70 / hcf $0 0% Ju19, 2015 2015 WATER & SEWER RATE STUDY - RATE WORKSHOP WITH DISTRICT BOARD 37 Backup Material Distributed Less Than 72 Hours Prior to the Meeting Yfjrba Linda Water.District Water SFR Customer Impacts Sample SFR Monthly Water Bills 1-inch meter at different usage levels $200 $180 $160 $140 - $120 $100 $80 $60 $40 $20 11 il 11 $0 10 hcf 20 hcf 25 hcf 40 hcf 50 hcf ■Current $43.77 $70.77 $84.27 $124.77 $151.77 ■ Proposed $68.57 $95.57 $109.07 $149.57 $176.57 Impacts $24.80 $24.80 $24.80 $24.80 $24.80 % Impacts 56.7% 35.0% 29.4% 19.9% 16.3% Jul 9, 2015 2015 WATER & SEWER RATE STUDY - RATE WORKSHOP WITH DISTRICT BOARD 38 Backup Material Distributed Less Than 72 Hours Prior to the Meeting 19 Yfjrba Linda Water District Concerns W*Ith C Rates Lack of Administrative Record for current rates Inconsistency rate structures for commercial use Included Fixed Charges Usage in Volurnetric Fixed Charges Within District 100% Sewer Users $5.50 per month 11 hcf / month Total Usage above Users with 100%flows returned to sewer 11 h cf * $0.46/hcf Mixed Users $5.50 per month 22 hcf / month Total Usage above Users with unknown flows returned to sewer 22hcf * $0.46/hcf Within City of Yorba Linda By meter size None 90% of prior year ($1.20 per month to usage * $0.176/hcf $54.91 per month) Jul 9, 2015 2015 WATER & SEWER RATE STUDY - RATE WORKSHOP WITH DISTRICT BOARD Backup Material Distributed Less Than 72 Hours Prior to the Meeting 9 Yorba Linda Water District Proposed Rates Rate Customer Class Structure Flow General Proposed Current Note Sewer Fixed Charges SFR-District Flat $2.54 $3.40 $5.94 $5.50 7 unit allowance MFR-District Flat $2.18 $3.40 $5.58 $3.85 6 unit allowance SFR-YLC Flat $2.54 $3.40 $5.94 $5.50 7 unit allowance MFR-YLC Flat $2.18 $3.40 $5.58 $5.50 6 unit allowance C11-Regular Flat + Vol $2.54 $3.40 $5.94 $5.50 7 unit allowance C11-YLC Flat + Vol $2.54 $3.40 $5.94 Varied by 7 unit allowance meter size Volumetric Rates $0.36 / hcf Estimated return factor is 83% Jul 9, 2015 2015 WATER & SEWER RATE STUDY - RATE WORKSHOP WITH DISTRICT BOARD 40 Backup Material Distributed Less Than 72 Hours Prior to the Meeting Yfirba Linda Water.District SFR Customer Impacts Water & Sewer Combined Bills Sample SFR Monthly Water and Sewer Bills 1-inch meter at different usage levels $200 $180 $160 $140 $120 $100 $80 $60 $40 $20 $0 10 hcf 20 hcf 25 hcf 40 hcf 50 hcf ■Current W+S $49.27 $76.27 $89.77 $130.27 $157.27 ■Proposed W+S $74.51 $101.51 $115.01 $155.51 $182.51 Impacts $25.24 $25.24 $25.24 $25.24 $25.24 % Impacts 51.2% 33.1% 28.1% 19.4% 16.0% Jul 9, 2015 2015 WATER & SEWER RATE STUDY - RATE WORKSHOP WITH DISTRICT BOARD 41 Backup Material Distributed Less Than 72 Hours Prior to the Meeting Yfjrba Linda Water District Disc ssion - �n f Jul 9, 2015 2015 WATER & SEWER RATE STUDY - RATE WORKSHOP WITH DISTRICT BOARD 42 ITEM NO. 13.1 AGENDA REPORT Meeting Date: July 9, 2015 Subject:Meetings from July 10, 2015 - August 31, 2015 ATTACHMENTS: Name:Description:Type: BOD_-_Activities_Calendar.pdf Backup Material Backup Material Event Date Attendance by: July 2015 WACOFri, Jul 10Hawkins/Kiley MWDOCWed, Jul 15Melton OCWDWed, Jul 15Kiley Yorba Linda Planning CommissionWed, Jul 15Melton Board of Directors Special MeetingThu, Jul 16 Weymouth Water Treatment Plant Inspection TripFri, Jul 17Collett/Kiley Yorba Linda City CouncilTue, Jul 21Beverage Joint Committee Meeting with City of Yorba LindaWed, Jul 22Collett/Beverage OCSDWed, Jul 22Kiley/Beverage Board of Directors Regular MeetingThu, Jul 23 Yorba Linda LMCACThu, Jul 23Beverage (As Needed) Citizens Advisory Committee MeetingMon, Jul 27Collett Joint Committee Meeting with City of PlacentiaMon, Jul 27Melton/Kiley Interagency Committee Meeting with MWDOC and OCWDTue, Jul 28Collett/Melton MWDOC Water Policy ForumWed, Jul 29Beverage/Collett/Hawkins/Kiley/Melton Yorba Linda Planning CommissionWed, Jul 29Hawkins ISDOCThu, Jul 30Kiley August 2015 Yorba Linda City CouncilTue, Aug 4Beverage MWDOCWed, Aug 5Melton OCSD Operations CommitteeWed, Aug 5Kiley/Beverage OCWDWed, Aug 5Collett WACOFri, Aug 7Hawkins/Kiley LAFCOWed, Aug 12Beverage (As Needed) Yorba Linda Planning CommissionWed, Aug 12Melton Board of Directors Regular MeetingThu, Aug 13 Yorba Linda LMCACThu, Aug 13Beverage (As Needed) Yorba Linda City CouncilTue, Aug 18Collett CASA Annual ConferenceWed, Aug 19 MWDOCWed, Aug 19Melton OCWDWed, Aug 19Kiley CASA Annual ConferenceThu, Aug 20 CASA Annual ConferenceFri, Aug 21 Citizens Advisory Committee MeetingMon, Aug 24Collett UWI Annual ConferenceWed, Aug 26Kiley Yorba Linda Planning CommissionWed, Aug 26Hawkins OCSDWed, Aug 26Kiley/Beverage UWI Annual ConferenceThu, Aug 27Kiley Board of Directors Regular MeetingThu, Aug 27 Yorba Linda LMCACThu, Aug 27Beverage (As Needed) UWI Annual ConferenceFri, Aug 28Kiley 6:30PM 8:00AM 8:30AM 6:30PM 8:00AM 5:30PM 8:00AM 8:00AM 8:30AM 8:00AM 6:30PM 6:30PM 8:30AM 6:30PM 6:30PM 8:00AM 8:30AM 6:30PM 8:30AM 5:00PM 5:30PM 7:30AM 8:00AM 4:00PM 5:30PM 6:30PM 11:30AM 10:00AM 6:30PM 8:30AM 6:30PM 8:30AM 2:00PM 8:30AM 5:30PM 6:30PM 8:30AM 7:00AM 6:30PM Board of Directors Activity Calendar Time 7:30AM 7/1/2015 7:23:33 AM