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HomeMy WebLinkAbout1994-10-03 - Finance-Accounting Committee Meeting Minutes 1 ' ITEM NO. ' AGENDA REPORT DATE: October 13, 1994 ' TO: President and Members of the Board FROM: Finance-Accounting Committee ' SUBJECT. Summary Minutes of the Finance-Accounting Committee Meeting ' The Finance-Accounting Committee held a meeting on October 3, 1994. Present were Michael Beverage, Arthur C. Korn, William Robertson and Beverly Meza. The following items were discussed at the meeting: ' 1 . Annual Audit. Mr. Rod McDaniel, Diehl Evans & Company, reviewed the preliminary Audit report for the fiscal year ending June 30, 1994. The Committee asked questions to clarify several sections in the report. Mr. McDaniel then discussed ' the Management Letter which addressed the District's job closing procedures. Mr. McDaniel closed with a report that FEMA will require an audit of projects they fund in excess of $100,000. This separate audit will cost between $4,000 and $5,000. The Annual Audit Report will be presented for review and acceptance by the full Board of ' Directors at a future Board meeting. Mr. McDaniel left after this report. 2. Water Rates. Mr. Robertson presented a report on finances and water rates. Due to a combination of higher year end balance than forecast and control over expenses, there is no crisis over water rates. The Committee requested that staff look at the option of phasing in small increases in anticipation of higher future imported and groundwater ' costs. Staff will conduct the requested analysis, plus a detailed review of the current fiscal year revenue stream, and present it to the Committee in about one month. 3. Metropolitan Water District's Nexus Study. Director Korn and Mr. Robertson ' reviewed Metropolitan's Nexus Study regarding Met's new water rate structure. Mr. Robertson reported a technical analysis indicates the District may incur Met's proposed Demand Charge, which is applied to water in excess of a four-year average imported ' water demand, on approximately 1,000 acre feet per year. Mr. Korn reviewed the philosophical and policy history behind the charge. The charge is designed to shift costs to new development. The Committee then held a lengthy discussion on the ' concept of differential water rates, at the conclusion of which they preferred to continue with the postage stamp rate on all customers. 4. Financial Master Plan Report - Phase III. Ms. Lora Stovall, Bartle Wells & ' Associates, presented Phase III the District's Financial Master Plan. Ms. Stovall reported that included among the variety of financing choices to pay for needed water system improvements is an increase of about 7 cents per Hundred Cubic Feet. The ' Committee requested that the Citizens Advisory Committee review and comment on the report before it's presented to the full Board of Directors. Mr. Michael Payne, Assistant General Manager, reported he will convene a CAC meeting as soon as practical. Mr. Payne and Ms. Stovall departed after this report. 1 S. Reimbursement of Expenses. The Committee discussed reimbursement of expenses incurred by the management for attendance at activities where it is in the ' District's best interest. In addition, the Committee noted that Director expenses are reviewed by the Executive Committee and staff expenses are reviewed by the General Manager, therefore, it's appropriate for the Executive Committee to include the General Manager's expense reports in the quarterly review of Director expenses. 1 1 1 1 1