Loading...
HomeMy WebLinkAbout2011-04-11 - Finance-Accounting Committee Meeting Minutes MINUTES OF THE YORBA LINDA WATER DISTRICT FINANCE-ACCOUNTING COMMITTEE MEETING April 11, 2011 A meeting of the Finance-Accounting Committee was called to order by Director Collett at 4:00 p.m. The meeting was held at the District's Administrative Office at 1717 E Miraloma Ave, Placentia CA 92870. COMMITTEE STAFF Director Ric Collett, Chair Ken Vecchiarelli, General Manager Director Robert R. Kiley Stephen Parker, Finance Director 1. PUBLIC COMMENTS None. 2. ACTION CALENDAR 2.1. February 2011 Budget to Actual Results Mr. Parker presented the February 2011 budget to actual results to the Committee. He pointed out that despite a revenue shortfall of approximately 3.6% of budget, that a reduction in supplies and services helped put the District in a situation where we have a positive trend year- to-date of over $1.2 million as compared to budget. This means that the District has a negative net income of $280,000 year-to-date instead of a larger loss as expected in the budget. The Committee pointed out some individual supplies and services line items that have been trending higher than budgeted all year, and Mr. Parker added that variable water costs as a percentage of budget should be improving in every remaining month of the fiscal year as we are purchasing more ground water in the second half of the fiscal year. The Committee received and filed the February 2011 Budget to Actual Results. 2.2. February 2011 Investment Report Mr. Parker identified that for the first time this year, the District's yield was over 1 He also explained some changes in reserve funds. The Committee received and filed the February 2011 Investment Report. 3. DISCUSSION ITEMS 3.1. Preliminary 2012 Budget Numbers Mr. Parker shared the preliminary budget numbers for FY 2011/2012. Mr. Parker explained that salaries and benefits were up only 3% despite signficant increases in health insurance, PERS expenses and a planning increase in 2 employees to work on the sewer side as a result of maintaining the City of Yorba Linda sewers. He also identified a significant increase in the vehicle equipment and capital outlay budget, but 1 explained that most of the increase is related to the required purchase of a new sewer vactor truck, which accounts for $420,000, and sewer slip lining, which accounts for $100,000 of the $774,850 budget. Supplies and Services proposed expenses includes a 7% decrease from the prior year. Lastly, included in the assumptions is an expected increase in water sales, and therefore the amount of funding for reserves would actually be higher than planned for in the budget for 2010/11. The intent is that the District's conservative reserves will be closer to being fully funded for the first time in many years. The Committee requested that a workshop be conducted to discuss any planned changes in organizational structure through the budget process. 3.2. FY 2011/12 Budget Calendar Update Mr. Parker presented the budget calendar update and pointed out that the April 21St date which had originally been scheduled as a Board Workshop was now set aside for a facilities tour, and that the current plan was to have budget information presented to the entire Board as a part of the May 12th Board meeting. In addition, updates were made to reflect Committee meeting dates that had changed, and Committee titles that had changed. 3.3. Draft Finance Department Budget Mr. Parker explained that the Finance Department cut their Supplies and Services budget by 10.5% from the 2010/11 budget. He asked if the Committee had any questions on specifics in the budget, and a number of individual items in the four sections of the Finance Department were discussed. The Committee had no recommended changes to the draft Finance Department budget. 3.4. Investment Policy Annual Review Mr. Parker presented the investment policy and informed the Committee that he had no recommended changes. He informed the Committee that there is no longer a requirement to update the investment policy annually, and asked their opinion. As the Committee's desire is to foster an open and transparent environment for the agency, they asked that the investment policy go to the full Board for adoption again this year, even if there are no changes to it. Mr. Parker indicated that he would present this to the Board with a supporting resolution in the second meeting in April. 3.5. Annual Reserve Policy Review Mr. Parker presented a draft annual reserve policy. He shared with the Committee the changes that he had made from the prior years' policy. The primary change was to add a new reserve called Maintenance Reserve, which would exist for non-scheduled capital asset repair and replacement, and would be funded by a reduction in the Capital Replacement Reserve. Other changes made included moving Employee Liabilities Reserve to a Board Designated Reserve, and minor revisions to language in the Capital Replacement Reserve and Employee Liabilities 2 Reserve. The Committee recommended that the changes to the reserve policy be discussed by the full Board in a workshop environment. 3.6. Future Agenda Items and Staff Tasks Staff asked the Committee if they would like to be involved in the interview process for the RFP for audit services. The Committee indicated that a recommendation brought before the Committee would be sufficient. The Committee requested that a workshop be conducted to discuss any changes to the organizational structure as well as to discuss potential changes to the reserve policy. 4. ADJOURNMENT 4.1. The Committee adjourned at 5:25 p.m. The next regular meeting of the Finance-Accounting Committee will be held on May 9, 2011 at 4:00 p.m. 3