Loading...
HomeMy WebLinkAbout1990-03-15 - Board of Directors Meeting MinutesPage aff*- - March 15, 1990 MINUTES OF THE YORBA LINDA WATER DISTRICT BOARD OF DIRECTORS ADJOURNED MEETING March 15, 1990 The adjourned meeting of the Board of Directors of the Yorba Linda Water District was called to order by Art Korn, President, at 8:32 a.m., in the District offices at 4622 Plumosa Drive, Yorba Linda. Directors present were: Paul Armstrong, Arthur Korn, Roy Knauft, Whit Cromwell and Sterling Fox. Also present were William P. Workman, General Manager; William Robertson, Assistant General Manager; Cheryl Gunderson, Business Manager. DISCUSSION CALENDAR Item 1. Discussion of Policies related to setting 1990 Water Rates - Continued from the Board's meeting of February 22, 1990. General Manager William Workman presented an overview of the District's financial structure and recommendations to maintain the health of the Water Operating Fund. He recommended that (1) Reliance on the Water Operating Fund balance be eliminated (2) A prudent Water Operating Fund balance be retained (3) Reliance on the Water Capital Fund interest to subsidize the Water Operating Fund be reduced (4) Development fees should continue to cover the full cost of development (5) Non-water rate revenues need to support the Water Operating Fund (6) Water rates need to be adjusted to better reflect current operating expenses and (7) Water rates should be examined after the annual budget is adopted. William Roberston, Assistant General Manager, presented a detailed summary of the actual financial condition of the Water Operating Fund and how the revenues and expenditures flow through the Fund. Cheryl Gunderson, Business Manager, provided supporting financial information from the audited Financial Statements. The Board reviewed and provided direction on a series of financial policies regarding the setting of water rates in 1990. - Should the Water District continue to drawdown the Water Operating Fund balance? Board direction: No, the District should not deplete the fund balance. - Should the Water District continue to transfer all unrestricted interest to balance the Water Operating Fund? Board Direction: Yes, the District should maximize the use of existing interest revenue. -Should the Water District allocate all unrestricted non water rate revenues to the Water Operating Fund? Board Direction: Yes, they mitigate the need for higher water rates. -1't l Page-1 March 15, 1990 -Should the Water District set a year end Water Operating Fund balance target of 25% of personnel, supplies and services? Board Direction: Yes, but it should be a flexible target reflecting the conditions for the year. -Should the Water District examine rates immediately following the adoption of the annual budget? Board direction: Yes, in this way the rates can respond to budget priorities. -Should the Water District continue to allocate the water rate's depreciation element to the Water Capital Improvement Fund and Capital Outlay Fund. Board Direction: Yes, this provides the funding for capital and outlay replacements. -Should the Water District establish a lifeline water rate for the elderly, handicapped and/or low income customers? Board direction: No, that would create differential treatment for customers. -Should the Water District examine the establishment of an emergency drought rate to encourage conservation? Board Direction: Yes, but more information and discussion is needed before a drought rate structure can be adopted by the Board. -Should the minimum monthly water allowance be eliminated? Board Direction: Yes, however it should be examined as part of any rate adjustments. -Should the District retain the Catastrophic Restoration Fund and keep the target of 3% of water plant assets? Board Direction: Yes, this Fund provides a reserve for emergency events. Should the Water District establish a water rate stabilization fund? Board Direction: Yes, this fund could eventually off-set the need for some water rate increases. Should the Water District increase the water rates to improve the revenue to the Water Operating Fund? Board Direction: Yes, the revenues are needed to better match the Water Operating Fund expenditures. The last water rate increase was 1986. Should the Water District retain the present water base rate and adjust the commodity charge? Board Direction: No, another method should be used to adjust the water rates. Page -l al March 15, 1990 Should the Water District increase the base water rate and the water commodity charge? Board Direction: Yes, this appears to be a better means to generate additional revenues. Adjusting both components by the sane ratio would appear to be the perfered method. Should the Water District adjust water rates now or some other time during the year? Board Direction: The water rates need to be adjusted after the adoption of the annual budget to go into effect in the fall. The recommendations for the rates reflecting the Board's financial direction need to be considered by the Board in July. ADJOURNMENT On a motion by Director Armstrong and seconded by Director Fox, the Board of Directors voted 5-0 to adjourn to March 21, 1990 at 2:00 p.m. in the District Boardroom. Will Workman General Manager/Secretary