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HomeMy WebLinkAbout2009-12-07 - Finance-Accounting Committee Meeting Agenda Packet 'rb Linda Water District AGENDA YORBA LINDA WATER DISTRICT FINANCE-ACCOUNTING COMMITTEE MEETING Monday, December 7, 2009, 4:00 PM 1717 E Miraloma Ave, Placentia CA 92870 COMMITTEE STAFF Director Michael J. Beverage, Chair Ken Vecchiarelli, General Manager Director John W. Summerfield Cindy Navaroli, Interim Finance Director Sandi Van Etten, Senior Accountant 1. PUBLIC COMMENTS Any individual wishing to address the committee is requested to identify themselves and state the matter on which they wish to comment. If the matter is on this agenda, the committee Chair will recognize the individual for their comment when the item is considered. No action will be taken on matters not listed on this agenda. Comments are limited to matters of public interest and matters within the jurisdiction of the Water District. Comments are limited to five minutes. 2. ACTION CALENDAR This portion of the agenda is for items where staff presentations and committee discussions are needed prior to formal committee action. 2.1. October Budget to Actual Results Recommendation: That the Committee receive and file the October 2009 budget to actual results. 2.2. Monthly Investment Report for September 2009 Recommendation: That the Committee receive and file the Investment Report. 2.3. Monthly Investment Report for October 2009 Recommendation: That the Committee receive and file the Investment Report. 2.4. Check Register Descriptions Recommendation: That the Committee approve the new format for the Check Register. 3. DISCUSSION ITEMS This portion of the agenda is for matters such as technical presentations, drafts of proposed policies, or similar items for which staff is seeking the advice and counsel of the Committee members. This portion of the agenda may also include items for information only. 3.1. Leaded Inventory - AB 1953 3.2. Employee Retirement Alternatives 3.3. Future Agenda Items and Staff Tasks 4. ADJOURNMENT 4.1. The next regular meeting of the Finance-Accounting Committee will be held January 12, 2009 at 4:00 p.m. Items Distributed to the Committee Less Than 72 Hours Prior to the Meeting Pursuant to Government Code section 54957.5, non-exempt public records that relate to open session agenda items and are distributed to a majority of the Committee less than seventy-two (72) hours prior to the meeting will be available for public inspection in the lobby of the District's business office located at 1717 E. Miraloma Avenue, Placentia, CA 92870, during regular business hours. When practical, these public records will also be made available on the District's internet website accessible at http://www.ylwd.com/. Accommodations for the Disabled Any person may make a request for a disability-related modification or accommodation needed for that person to be able to participate in the public meeting by telephoning the Executive Secretary at 714-701-3020, or writing to Yorba Linda Water District, P.O. Box 309, Yorba Linda, CA 92885-0309. Requests must specify the nature of the disability and the type of accommodation requested. A telephone number or other contact information should be included so the District staff may discuss appropriate arrangements. Persons requesting a disability-related accommodation should make the request with adequate time before the meeting for the District to provide the requested accommodation. ITEM NO. 2.1 AGENDA REPORT Meeting Date: December 7, 2009 Budgeted: N/A To: Finance-Accounting Committee Funding Source: N/A From: Ken Vecchiarelli, General Manager Presented By: Cindy Navaroli, Interim Finance Dept: Finance Director Reviewed by Legal: N/A Prepared By: Cindy Navaroli, Interim Finance CEQA Compliance: N/A Director Subject: October Budget to Actual Results STAFF RECOMMENDATION: That the Committee receive and file the October 2009 budget to actual results. DISCUSSION: Attached are the budget to actual results for the Water Fund, Sewer Fund, and a summary of both funds. Overall, the District is on target with projections for the first third of the year. There are a few areas that were over or under budget, however, these amounts will likely net with each other overall. Staff will be preparing a mid-year budget revision in January to adjust as needed. PRIOR RELEVANT BOARD ACTION(S): On October 27, 2009 the Committee approved the 1 st quarter financial statements (July - September 2009). ATTACHMENTS: Water, Oct. 2009.xls 'later Fund Backup Material Sewer Oct. 2009.xls Sewer Fund Backup Material Water Sewer summary, October 2009.xls "later & Sewer Backup Material Yorba Linda Water District Water Fund For the Four Months Ending October 31, 2009 FY 2010 % of Annual October Actual Annual Budget 2009 YTD Budget Revenue (Operating): Water Revenue (Residential) $17,692,953 $1,607,225 $6,026,835 34.06% (Restricted for Debt Service) 0 Water Revenue (Commercial & Fire Det.) 1,680,500 159,958 595,418 35.43% Water Revenue (Landscape/Irrigation) 3,654,419 361,861 1,369,094 37.46% Other Operating Revenue 643,792 66,240 260,134 40.41% Total Operating Revenue: 23,671,664 1,964,958 7,179,149 30.33% Expenses (Operating): Variable Water Costs (G.W., Import & Power) 12,259,937 861,348 4,651,114 37.94% Salary Related Expenses 6,538,008 433,825 1,830,684 28.00% Supplies & Services: Communications 268,694 30,374 123,025 45.79% Contractual Services 964,090 64,236 284,282 29.49% Data Processing 116,148 0 356 0.31% Dues & Memberships 30,068 471 4,547 15.12% Fees & Permits 50,160 313 29,825 59.46% Insurance 342,433 0 194,359 56.76% Materials 427,424 42,096 166,754 39.01% District Activities, Emp Recognition 13,832 552 622 4.50% Maintenance 384,362 10,530 63,329 16.48% Non-Capital Equipment 139,910 8,064 22,200 15.87% Office Expense 66,775 2,343 7,848 11.75% Professional Services 760,575 70,869 208,413 27.40% Training 61,518 1,019 5,014 8.15% Travel & Conferences 48,892 1,430 2,261 4.62% Uncollectible Accounts 47,320 0 0 0.000/0 Collection Agency Fee 3,185 0 0 0.00% Utilities 27,027 13,315 54,888 203.09% Vehicle Equipment 279,683 34,765 122,862 43.93% Supplies & Services Sub-Total 4,032,096 280,377 1,290,585 32.01% Depreciation & Amortization 3,945,750 336,468 1,344,236 34.07% Total Operating Expenses 26,775,791 1,912,018 9,116,619 34.05% Operating Income (Loss) 52,940 62.42% Revenue (Non-Operating): Interest 500 4,702 17,522 3504.40% Interest (Restricted for Capital Projects) 0 8,661 34,452 Property Taxes 1,092,000 9,585 54,812 5.02% Debt Service Income (through water revenue) 0 230,326 1,072,332 Other Non-Operating Revenue 172,900 40,219 152,170 88.01% Total Non-Operating Revenue: 1,265,400 293,493 1,331,288 105.21% Expenses (Non-Operating): Interest on Long Term Debt 1,981,300 161,612 654,203 33.02% Job Closing Expense 40,000 Other Expense 154,500 7,529 25,048 16.21% Total Non-Operating Expenses: 2,175,800 169,141 679,251 31.22% Non-Operating Income (Loss) 124,352 652,037 -71.62% Total Income (Loss) 177,292 32.02% Contributed Capital 190,962 7,630 135,469 70.94% Yorba Linda Water District Sewer Fund For the Four Months Ending October 31, 2009 FY 2010 % of Annual October Actual Annual Budget 2009 YTD Budget Revenue (Operating): Sewer Charge Revenue $1,160,000 $97,354 $404,797 34.90% Locke Ranch Assessments 116,000 573 1,695 1.46% Other Operating Revenue 5,100 261 1,130 22.16% Total Operating Revenue: 1,281,100 98,188 407,622 31.82% Expenses (Operating): Salary Related Expenses 817,041 58,498 241,119 29.51% Supplies & Services: Communications 26,654 3,004 12,376 46.43% Contractual Services 137,255 26,201 43,935 32.01% Data Processing 11,487 0 35 0.30% Dues & Memberships 3,360 47 442 13.15% Fees & Permits 6,040 15 2,083 34.49% Insurance 33,867 0 19,222 56.76% Materials 21,301 409 2,951 13.85% District Activities 1,368 55 62 4.53% Maintenance 29,789 1,115 5,889 19.77% Non-Capital Equipment 18,631 414 1,250 6.71% Office Expense 9,550 232 630 6.60% Professional Services 77,925 7,009 20,731 26.60% Training 8,632 65 366 4.24% Travel & Conferences 6,893 141 261 3.79% Uncollectible Accounts 4,680 0 0 0.00% Collection Agency Fee 315 0 0 0.00% Utilities 2,673 578 1,239 46.35% Vehicle Equipment 47,068 4,277 14,768 31.38% Supplies & Services Sub-Total 447,488 43,562 126,240 28.21% Depreciation & Amortization 595,050 47,602 190,408 32.00% Total Operating Expenses 1,859,579 149,662 557,767 29.99% Operating Income (Loss) 25.96% Revenue (Non-Operating): Interest 7,000 899 3,576 51.09% Interest (Restricted for Capital Projects) 0 155 616 Property Taxes 108,000 0 0 0.00% Other Non-Operating Revenue 12,600 695 5.52% Total Non-Operating Revenue: 127,600 806 4,887 3.83% Expenses (Non-Operating): Job Closing Expense 5,000 0 0 0.000/0 Other Expense 2,300 226 868 37.74% Total Non-Operating Expenses: 7,300 226 868 11.89% Non-Operating Income (Loss) 120,300 580 4,019 3.34% Total Income (Loss) 31.89% Contributed Capital 74,240 2,000 40,805 54.96% Yorba Linda Water District Summary Financial Report Water & Sewer For the Four Months Ending October 31, 2009 Full Year % of Budget Actual Annual Budget FY 09/10 YTD through Amended Amended 10/13/09 October 31, 2009 10/13/09 Revenue (Operating): Water Revenue (Consumption & Flat Charge) $23,027,873 $7,991,347 35% (Restricted for Debt Service) (1,072,332) Sewer Revenue 1,276,000 406,492 32% Other 586,892 261,264 45% 7586771 Total Operating Revenue: 24,890,765 7,586,771 30% Expenses (Operating): Variable Water Costs (G.W., Import & Power) 12,259,938 3,789,766 31% Salary Related Expenses 7,005,049 1,579,480 23% Supplies & Services 4,479,584 1,092,886 24% Depreciation &Amortization 4,540,800 1,150,574 25% Total Operating Expenses: 28,285,371 7,612,706 27% Operating Income (Loss) (3,394,606) (25,935) 1 % Revenue (Non-Operating): Interest 147,500 41,749 28% Property Taxes 1,200,000 45,227 4% Debt Service Income (through water revenue) 842,006 Other 107,500 112,894 105% Total Non-Operating Revenue: 1,455,000 1,041,876 72% Expenses (Non-Operating): Interest on Long Term Debt 1,981,300 492,591 25% Other Expense 201,800 18,161 9% Total Non-Operating Expenses: 2,183,100 510,752 23% Non-Operating Income (Loss) (728,100) 531,124 Net Income (Loss) (4,122,706) 505,189 -12% Contributed Capital 381,924 166,644 44% ITEM NO. 2.2 AGENDA REPORT Meeting Date: December 7, 2009 Budgeted: N/A To: Finance-Accounting Committee Funding Source: N/A From: Ken Vecchiarelli, General Manager Presented By: Cindy Navaroli, Interim Finance Dept: Finance Director Reviewed by Legal: N/A Prepared By: Sandi Van Etten, Senior CEQA Compliance: N/A Accountant Subject: Monthly Investment Report for September 2009 SUMMARY: Government Code Section 53607, et, seq., requires the person delegated to invest funds to make a quarterly report of the investments to the legislative body. Monthly reports are reviewed by the Finance- Accounting Committee. STAFF RECOMMENDATION: That the Committee receive and file the Investment Report. DISCUSSION: Staff is submitting the September 2009 Monthly Investment Report for your review and approval. PRIOR RELEVANT BOARD ACTION(S): Monthly Investment Reports are presented to the Finance-Accounting Committee on a regular basis. Quarterly Investment Reports are presented to the Board of Directors. ATTACHMENTS: Agenda, 12-7 backup-Sep.doc agenda backup, Sept 09 Backup Material Invst Rpt 9-09.xls :vestment Rpt Sept 09 Backup Material Investment Report Summary Below is a chart summarizing the yields as well as terms and maturities for the month of September 2009. Avg. Portfolio Avg. Portfolio # of Avg. Term Month Yield Without Yield With Days to of Portfolio of 2009 Wells Capital Wells Capital Maturity in Days September 0.31% 0.51% 134 57 Below is a chart comparing operating fund interest for current and prior fiscal years. Actual Interest 09/30/08 09/30/09 Monthly, Operating Fund $ 1,003 $ 4,370 Year-to-Date, Operating Fund $ 1,925 $ 9,548 Budget 2008/2009 2009/2010 Interest Budget, Operating Fund, Sept. YTD $16,125 $1,875 Interest Budget, Operating Fund, Annual $64,500 $7,500 Interest earned on investments is recorded in the Fund that owns the investment. Investment Summary Comparison The distribution of investments in the portfolio both in dollars and as a percentage of the total portfolio by funds is as follows: Fund Description Balance 09/30/09 Annexation $4,704,717 10.85% Water Operating 567,100 1.31% Water R&R 2,054,029 4.74% Water Capital Projects 231,204 0.53% Restricted for Debt Service 474,304 1.09% COP Revenue Bond 2003 448,242 1.03% COP Revenue Bond 2008 20,827,231 48.05% Sewer Operating 1,412,079 3.26% Sewer R&R 417,379 0.96% Sewer Capital Projects 189,214 0.44% ID1 3,681,540 8.49% D2 8,342,968 19.25% $43,350,007 100.00% Yorba Linda Water District Investment Portfolio Report September 30, 2009 Market % Percent Investment Maturity Value Cost of Total Institution Yield Date Date Cash & Checking Accounts: $ 377,182 $ 377,182 Wells Fargo Bank N/A 1,200 1,200 Imprest Cash $ 378,382 $ 378,382 0.87% Total 0.00% Money Market Accounts: $ 178,684 $ 178,684 Wells Fargo Money Market 0.30% N/A - - Wells Fargo MM/Annexation 0.30% $ 178,684 $ 178,684 0.41% Total 0.30% $ 557,066 $ 557,066 1.29% Sub-total 0.10% California Asset Mgmt. Program: $ 5,095,718 $ 5,095,718 11.78% California Asset Mgmt. Program 0.38% N/A Money Market Account: $ 21,275,473 $ 21,275,473 US Bank 2008 Revenue Bond 0.30% 0 0 US Bank 2003 Revenue Bond 0.00% N/A $ 21,275,473 $ 21,275,473 49.16% 0.30% $ 26,928,257 $ 26,928,257 62.23% Sub Total Investments 0.31% Individual Management Account: $ 16,372,221 $ 16,346,337 37.77% Wells Capital Management 0.83% N/A $ 43,300,478 $ 43,274,594 100% Total Investments 0.51% Per Government Code requirements, the Investment Report is in compliance with the Yorba Linda Water District's Investment Policy, and there are adequate funds available to meet budgeted and actual expenditures for the next six months. Sandi Van Etten, Senior Accountant 9/30/2009 ITEM NO. 2.3 AGENDA REPORT Meeting Date: December 7, 2009 Budgeted: N/A To: Finance-Accounting Committee Funding Source: N/A From: Ken Vecchiarelli, General Manager Presented By: Cindy Navaroli, Interim Finance Dept: Finance Director Reviewed by Legal: N/A Prepared By: Sandi Van Etten, Senior CEQA Compliance: N/A Accountant Subject: Monthly Investment Report for October 2009 SUMMARY: Government Code Section 53607, et, seq., requires the person delegated to invest funds to make a quarterly report of the investments to the legislative body. Monthly reports are reviewed by the Finance-Accounting Committee. STAFF RECOMMENDATION: That the Committee receive and file the Investment Report. DISCUSSION: Staff is submitting the October 2009 Monthly Investment Reports for review and approval. PRIOR RELEVANT BOARD ACTION(S): Monthly Investment Reports are presented to the Finance-Accounting Committee on a regular basis. Quarterly Investment Reports are presented to the Board of Directors. ATTACHMENTS: Invst Rpt 10-09.xls nvestment Rpt Backup Material Agenda, 12-7 backup-Oct.doc 4 ct 09 backup Backup Material Yorba Linda Water District Investment Portfolio Report October 31, 2009 Market % Percent Investment Maturity Value Cost of Total Institution Yield Date Date Cash & Checking Accounts: $ 621,157 $ 621,157 Wells Fargo Bank N/A 1,200 1,200 Imprest Cash $ 622,357 $ 622,357 1.51% Total 0.00% Money Market Accounts: $ 178,730 $ 178,730 Wells Fargo Money Market 0.30% N/A - - Wells Fargo MM/Annexation 0.30% $ 178,730 $ 178,730 0.43% Total 0.30% $ 801,087 $ 801,087 1.95% Sub-total 0.07% California Asset Mgmt. Program: $ 5,096,997 $ 5,096,997 12.39% California Asset Mgmt. Program 0.30% N/A Money Market Account: $ 17,571,074 $ 17,571,074 US Bank 2008 Revenue Bond 0.30% 4 4 US Bank 2003 Revenue Bond 0.27% N/A $ 17,571,078 $ 17,571,078 42.71% 0.30% $ 23,469,162 $ 23,469,162 57.04% Sub Total Investments 0.29% Individual Management Account: $ 17,699,670 $ 17,673,810 42.96% Wells Capital Management 0.61% N/A $ 41,168,832 $ 41,142,972 100% Total Investments 0.43% Per Government Code requirements, the Investment Report is in compliance with the Yorba Linda Water District's Investment Policy, and there are adequate funds available to meet budgeted and actual expenditures for the next six months. Sandi Van Etten, Senior Accountant 10/31/2009 Investment Report Summary Below is a chart summarizing the yields as well as terms and maturities for the month of October 2009. Avg. Portfolio Avg. Portfolio # of Avg. Term Month Yield Without Yield With Days to of Portfolio of 2009 Wells Capital Wells Capital Maturity in Days October 0.29% 0.43% 102 65 Below is a chart comparing operating fund interest for current and prior fiscal years. Actual Interest 10/31/08 10/31/09 Monthly, Operating Fund $ 1,140 $ 3,578 Year-to-Date, Operating Fund $ 3,065 $13,126 Budget 2008/2009 2009/2010 Interest Budget, Operating Fund, October YTD $21,500 $2,500 Interest Budget, Operating Fund, Annual $64,500 $7,500 Interest earned on investments is recorded in the Fund that owns the investment. Investment Summary Comparison The distribution of investments in the portfolio both in dollars and as a percentage of the total portfolio by funds is as follows: Fund Description Balance 10/31/09 Annexation $4,728,573 11.48% Water Operating 2,257,566 5.48% Water R&R 2,054,953 4.99% Water Capital Projects 231,204 0.56% Restricted for Debt Service 704,630 1.71% COP Revenue Bond 2003 4 0.00% COP Revenue Bond 2008 17,571,074 42.65% Sewer Operating 1,391,255 3.38% Sewer R&R 432,655 1.05% Sewer Capital Projects 189,299 0.46% ID1 3,427,815 8.32% ID2 8,209,274 19.92% $41,198,302 100.00% ITEM NO. 2.4 AGENDA REPORT Meeting Date: December 7, 2009 Budgeted: N/A To: Finance-Accounting Committee Funding Source: N/A From: Ken Vecchiarelli, General Manager Presented By: Cindy Navaroli, Interim Finance Dept: Finance Director Reviewed by Legal: N/A Prepared By: Cindy Navaroli, Interim Finance CEQA Compliance: N/A Director Subject: Check Register Descriptions STAFF RECOMMENDATION: That the Committee approve the new format for the Check Register. DISCUSSION: In the past the Board has requested that the Check Register presented at each Board meeting include descriptions for larger disbursements. Attached is a sample of the last check register presented to the Board on 11/25/09, depicting how that register would look with descriptions for items over $25,000. ATTACHMENTS: esc ipdic ype. Sample Check Register.pdf Sample Check Register Backup Material Yorba Linda Water District Check Register For Checks Dated: 11/13/2009 thru 11/25/2009 Check No. Date Vendor Name Amount Description ($25k or greater) 52891 11/25/2009 Abbott Staffing Group, Inc. 6,864.95 52892 11/25/2009 AGB - American Geophysical 1,790.00 52893 11/25/2009 Alternative Hose Inc. 769.66 52894 11/25/2009 Anixter Inc. 675.64 52895 11/25/2009 Answer One Communications 468.46 52896 11/25/2009 Apollo Technologies Inc. 380.00 52897 11/25/2009 Aqua-Metric Sales Co. 19,584.42 52898 11/25/2009 Aramark Uniform Services, Inc 401.76 52899 11/25/2009 Associated Laboratories 3,589.70 52900 11/25/2009 AT & T Mobility 412.54 52901 11/25/2009 Battery Systems 101.75 52902 11/25/2009 Brian Murdock 18.46 52903 11/25/2009 Carollo Engineers 42,099.50 Hidden Hills Reservoir Engineering Services 52904 11/25/2009 CDM, Inc. 4,100.20 52905 11/25/2009 CDW Government, Inc 5.39 52906 11/25/2009 City Of Anaheim 13,578.63 52907 11/25/2009 City Of Placentia 6,715.18 52908 11/25/2009 Clinical Lab. Of San Bern. 1,905.00 52909 11/25/2009 Coast Surveying, Inc. 2,395.00 52910 11/25/2009 Cody Nottingham 64.00 52911 11/25/2009 Cogsdale Services Corporation 2,408.88 52912 11/25/2009 Dapper Tire Co. Inc. 695.54 52913 11/25/2009 Datalok Orange County 275.91 52914 11/25/2009 DeltaCare USA 296.32 52915 11/25/2009 Dick's Lock & Safe Inc. 486.80 52916 11/25/2009 E. G. Brennan & Co., Inc 46.22 52917 11/25/2009 Eisel Enterprises, Inc. 274.43 52918 11/25/2009 Federal Express 22.85 52919 11/25/2009 Field Asset Svs 30.50 52920 11/25/2009 Filter Recycling Services, Inc 181.70 52921 11/25/2009 Haitbrink Asphalt Paving Inc 1,400.00 52922 11/25/2009 Home Depot Credit Services 329.04 52923 11/25/2009 Infosend Inc. 9,285.90 52924 11/25/2009 Jack Ramsey 22.66 52925 11/25/2009 Jackson's Auto Supply - Napa 433.81 52926 11/25/2009 Karen Shea 97.98 52927 11/25/2009 Katrina Brown 1,460.93 52928 11/25/2009 Ken Mendum 69.00 52929 11/25/2009 Lan T Lam 63.65 52930 11/25/2009 Lincoln National Life 1,894.35 52931 11/25/2009 Linette Nyaggah 25.58 52932 11/25/2009 LPR 125.06 52933 11/25/2009 Mc Cormick,Kidman & Behrens LLP 18,943.60 52934 11/25/2009 Minuteman Press 445.84 52935 11/25/2009 Mouse Graphics 11,668.22 52936 11/25/2009 Mudge Fasteners, Inc 259.48 52937 11/25/2009 MWH Americas, Inc. 75,476.91 Highland Booster Pump Station project 52938 11/25/2009 Nationwide Drafting & Office Supply 528.19 52939 11/25/2009 Nextel Of California 1,761.56 52940 11/25/2009 Nickey Petroleum Co 3,302.37 52941 11/25/2009 Office Solutions 506.74 52942 11/25/2009 ONLINE Collections 56.71 52943 11/25/2009 Orange County - Auditor/Cont 332.50 52944 11/25/2009 Orvac Electronics 150.93 52945 11/25/2009 Parts Source Anaheim 268.56 52946 11/25/2009 Peggy McClure 787.50 52947 11/25/2009 Petra Geotechnical Inc. 7,250.75 52948 11/25/2009 Preferred Group Prop 3.89 52949 11/25/2009 R J Services, Inc 2,363.47 52950 11/25/2009 Red Wing Shoes - Sta Ana 146.38 52951 11/25/2009 Richard Gangloff III 639.44 52952 11/25/2009 Rootx 4,927.68 52953 11/25/2009 RSM McGladrey, Inc. 2,640.50 52954 11/25/2009 SC Fuels 1,260.90 52955 11/25/2009 Snap-On Tools 473.06 52956 11/25/2009 Southern Calif Edison Co. 186.83 52957 11/25/2009 Southern Calif Gas Co. 17,534.21 52958 11/25/2009 St.Joseph Heritage Healthcare 70.00 52959 11/25/2009 Stacy Bavol 136.40 52960 11/25/2009 Stacy Bavol/Petty Cash 544.92 52961 11/25/2009 Standard Register 387.15 52962 11/25/2009 Staples Business Advantage 202.32 52963 11/25/2009 Stefano's Golden Baked Hams 155.25 52964 11/25/2009 Steven Andrews Engineering 5,180.00 52965 11/25/2009 Tetra Tech, ISG 7,906.74 52966 11/25/2009 The Garden Gate 72.85 52967 11/25/2009 Townsend Public Affairs, Inc. 5,240.00 52968 11/25/2009 Traci Henderson 68.79 52969 11/25/2009 U S Postmaster 180.00 52970 11/25/2009 Village Nurseries 82.87 52971 11/25/2009 Wells Supply Co 557.74 52972 11/25/2009 William Mills 20.90 52973 11/25/2009 Yorba Linda Hardware 28.51 W112509 11/25/2009 Parsons Engineering Science 674.35 Total $299,272.36 ITEM NO. 3.1 AGENDA REPORT Meeting Date: December 7, 2009 Budgeted: No To: Finance-Accounting Committee Cost Estimate: $50,000 From: Ken Vecchiarelli, General Manager Presented By: Cindy Navaroli, Interim Finance Dept: Administration Director Reviewed by Legal: N/A Prepared By: Cindy Navaroli, Interim Finance CEQA Compliance: N/A Director Subject: Leaded Inventory - AB 1953 DISCUSSION: On September 30, 2006, the State of California passed into law Assembly Bill 1953, which limits the allowable amount of lead in plumbing fixtures in potable drinking water distribution systems. The law, which goes into effect January 1, 2010, prohibits the sale and use of any pipe, plumbing and pipe fitting or fixture containing greater than 0.25% lead, intended to convey or dispense water for drinking or cooking. The purpose of the law is to enhance water quality by reducing the potential for lead to leach into drinking water from certain types of fixtures that contain lead mixtures greater than 0.25% in composition. At this time only two states have passed laws of this nature; California and Vermont. The remaining states are not subject to such restrictive lead regulations at this time. Staff has reviewed all existing inventory to determine which items, if not used before January 1 , 2010, will need to be replaced with similar low-lead items. Approximately $40,000 of leaded inventory will be unusable as of January 1 , 2010. The cost to replace this inventory with low-lead parts, ordering at minimum stock levels, is approximately $10,000. To help defray this cost, Staff is in the process of working with distributors to sell the leaded inventory (at a reduced cost) to other vendors or water agencies in neighboring states that do not have as stringent lead restrictions. The total estimated financial impact is an additional $50,000 in material expenses, none of which was budgeted for in 2010. However, that expense will be offset by any amounts received for the sale of the leaded inventory. Staff plans to do a mid-year budget review to determine overall budget performance and the need for budget transfers between accounts.