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HomeMy WebLinkAbout2012-07-23 - Finance-Accounting Committee Meeting Agenda Packet Yorba Linda Water District AGENDA YORBA LINDA WATER DISTRICT FINANCE-ACCOUNTING COMMITTEE MEETING Monday, July 23, 2012, 4:00 PM 1717 E Miraloma Ave, Placentia CA 92870 COMMITTEE STAFF Director Robert R. Kiley, Chair Stephen Parker, Finance Manager Director Phil Hawkins 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. Sewer Charges Collected on the Tax Roll for Fiscal Year 2012/13 Recommendation: That the Committee recommend the Board of Directors adopt Resolution No. 12-16 Electing to Have Certain Sewer Maintenance Charges Collected on the FY 2012113 Tax Roll and Superceding Resolution No. 11-18. 2.2. Investment Report for Period Ending June 30, 2012 Recommendation: That the Committee recommend the Board of Directors receive and file the Investment Report for the Period Ending June 30, 2012. 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. Auditor Discussion with Those In Governance 3.2. Line of Credit/Advance Refunding Update (Verbal Report) 3.3. Broker Dealer Approval 3.4. Upcoming Pension Accounting Changes 3.5. June 2012 Budget to Actual Results 3.6. Status of Strategic Plan Initiatives 3.7. Future Agenda Items and Staff Tasks 4. ADJOURNMENT 4.1. The next meeting of the Finance-Accounting Committee will be held Monday, August 27, 2012 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: July 23, 2012 Budgeted: Yes Total Budget: $600 To: Finance-Accounting Committee Cost Estimate: $600 Funding Source: Sewer Operating Fund Presented By: Stephen Parker, Finance Dept: Finance Manager Reviewed by Legal: Yes Prepared By: Joann Gitmed, Accounting Assistant II Subject: Sewer Charges Collected on the Tax Roll for Fiscal Year 2012/13 SUMMARY: Each year at this time, the Board of Directors elects to collect certain sewer maintenance charges on the property tax rolls. STAFF RECOMMENDATION: That the Committee recommend the Board of Directors adopt Resolution No. 12-16 Electing to Have Certain Sewer Maintenance Charges Collected on the FY 2012/13 Tax Roll and Superceding Resolution No. 11-18. DISCUSSION: The District collects the Sewer Maintenance Charge by adding it to the water bill of customers where the District provides water service and the customer also has a connection to the sewer system. For customers connected to the District sewer system that receive water service from another purveyor or those customers that do not receive a water bill from the District, the Sewer Maintenance Charge is collected through the property tax rolls prepared by the County of Orange Auditor/Controller. This process is legally authorized and established by Resolution of the Board. Residents of the Locke Ranch area do not receive water from the District, so their sewer charges are collected on the tax roll. In addition, due to the disparity in rates between the City of Yorba Linda and the District's Sewer Maintenance Charges, it has been determined that those classifications with rate differences need to be placed on the tax roll for collection until a Proposition 218 process can be completed to equalize the rates. The Sewer Maintenance Charges are subject to the substantive and procedural requirements of Proposition 218 (California Constitution Article XIII D) barring an increase in the rates and/or a discretionary CPI increase of more than 5%, except with proper notification to the property owners affected allowing adequate opportunity to protest any such increases. Staff is not recommending a change to the current sewer maintenance charge at this time. To collect the current maintenance charges on the tax rolls for Fiscal Year 2012/13, the County of Orange Auditor/Controller's Office requires a certified Resolution by the Board of Directors directing their office to add the charges to the tax rolls for the properties assessed. The County establishes a deadline in August to receive this information. PRIOR RELEVANT BOARD ACTION(S): On July 28, 2011 , the Board of Directors passed Resolution No. 11-17 adopting sewer maintenance charges for all customers. On July 28, 2011 the Board of Directors passed Resolution No. 11-18 electing to have the sewer maintenance charges collected on the Fiscal Year 2011/12 tax roll. ATTACHMENTS: Description: Type: Resolution No. 12-16.docx Resolution Resolution RESOLUTION NO. 12-16 RESOLUTION OF THE BOARD OF DIRECTORS OF THE YORBA LINDA WATER DISTRICT ELECTING TO HAVE CERTAIN SEWER MAINTENANCE CHARGES COLLECTED ON THE FISCAL YEAR 2012/13 TAX ROLL AND SUPERCEDING RESOLUTION NO. 11-18 WHEREAS, Resolution No. 11-17 set out sewer rates for the Yorba Linda Water District ("District") and via Resolution 07-13 these rates are in compliance with substantive and procedural requirements of Proposition 218 (California Constitution Art. XIII D); and WHEREAS, under the authority of the California Water Code Sections 31100 the District may provide sewer service to property located outside the District boundaries and the District's Regulations for Rendition of Sanitary Sewer Service include a provision that a sewer maintenance charge is adopted by Resolution; and WHEREAS, under authority of California Water Code Sections 31101 and 31102 the District may prescribe and collect charges for sewer services and facilities and may collect sewer charges in any lawful manner; and WHEREAS, under California Health and Safety Code Sections 5471 and 5473 the District may elect to have the County of Orange Auditor/Controller collect sewer charges on the Orange County Property Tax Roll. NOW THEREFORE, BE IT RESOLVED by the Board of Directors of the Yorba Linda Water District to adopt Sewer Maintenance Charge as follows: Section 1. The Board of Directors elects to have the County of Orange Auditor/Controller collect the charges fixed herein on the tax roll in the same manner, by the same persons, and at the same time and together with and not separately from County of Orange taxes. Section 2. The General Manager or his designee is authorized and directed to file with the County of Orange Auditor/Controller a copy of this Resolution together with the listing of parcel numbers and amounts of charges shown in Exhibit "A" and such other documentation as the County Auditor/Controller may require in order to accomplish the purposes of this Resolution. Section 3. Resolution No. 11-18 is superseded effective immediately by the adoption of this Resolution. Resolution No. 12-16 Electing to Have Certain Sewer Maintenance Charges Collected on the FY 2012/13 Tax Roll 1 PASSED AND ADOPTED this 26th day of July 2012 by the following called vote: AYES: NOES: ABSTAIN: ABSENT: Phil Hawkins, President Yorba Linda Water District ATTEST: Annie Alexander, Assistant Board Secretary Yorba Linda Water District Reviewed as to form by General Counsel: Arthur G. Kidman, Esq. Kidman Law LLP Resolution No. 12-16 Electing to Have Certain Sewer Maintenance Charges Collected on the FY 2012/13 Tax Roll 2 ITEM NO. 2.2 AGENDA REPORT Meeting Date: July 23, 2012 To: Finance-Accounting Committee Presented By: Stephen Parker, Finance Dept: Finance Manager Prepared By: Delia Lugo, Senior Accountant Subject: Investment Report for Period Ending June 30, 2012 SUMMARY: Staff is submitting the June 2012 Monthly Investment Reports for the Committee's review. STAFF RECOMMENDATION: That the Committee recommend the Board of Directors receive and file the Investment Report for the Period Ending June 30, 2012. DISCUSSION: The Investment Portfolio Report presents the market value and percent yield for all District investments by institution. The Investment Report Summary includes budget and actual interest and average term portfolio information as well as market value broken out by reserve categories. The total yield for the month ending June 2012 increased to 0.93%. This is the result of the yield change of investments held in CaITRUST's Medium Term portfolio from 0.99% to 1 .01%. The overall decrease in the investment balance from the previous month is approximately $4 million. This is primarily due to the $5 million outlay related to the Freeway Complex Fire settlement. In the month of June staff initiated transfers between various reserves held in investments. The primary purpose of the transfers was to end the year in accordance with the reserve policy and projected funding levels. STRATEGIC PLAN: FR 3-C: Manage Cash Flow to Maximize Investment Income ATTACHMENTS: Name. Description: Type: Invst Rpt 6-12.xlsx June 2012 Investment Report Backup Material Invst Agenda Backup - June 2012.xlsx Agenda Back Up Backup Material Yorba Linda Water District Investment Portfolio Report June 30, 2012 Market % Percent Value Cost of Total Institution Yield Checking Account: $ 64,927 $ 64,927 Wells Fargo Bank $ 64,927 $ 64,927 0.30% Total 0.00% Money Market Accounts: $ 54,929 $ 54,929 Wells Fargo Money Market 0.05% 17,248 17,248 US Bank(2008 Bond Reserve) 0.04% $ 72,177 $ 72,177 0.33% Total 0.05% Federal Home Loan Bank: $ 2,157,786 $ 2,144,397 US Bank(2008 Bond Reserve) 1.35% $ 2,157,786 $ 2,144,397 9.92% 1.35% Pooled Investment Accounts: $ 3,325,147 $ 3,325,147 Local Agency Investment Fund 0.36% 500,338 500,338 Ca1TRUST Short Term 0.44% 15,624,717 15,582,741 Ca1TRUST Medium Term 1.01% $ 19,450,202 $ 19,408,227 89.45% 0.88% $ 21,745,093 $ 21,689,728 100% Total Investments 0.93% 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. Delia Lugo, Senior Accountant 6/30/12 Investment Summary Report Below is a chart summarizing the yields as well as terms and maturities for the month of June 2012: Avg. Portfolio Avg. Portfolio #of Month Yield Without Yield With Days to of 2012 CalTRUST CalTRUST Maturity June 0.73% 0.93% 94 Below is are charts comparing operating fund interest for current and prior fiscal years. Actual Interest 6/30/2011 6/30/2012 Monthly-June $ 23,537 $ 15,398 Year-to-Date $ 228,670 $ 258,155 Budget 2010/2011 2011/2012 Interest Budget, June YTD $ 156,000 $ 190,000 Interest Budget, Annual $ 156,000 $ 190,000 Interest earned on investments is recorded in the fund that owns the investment. Investment Summary Comparison Between Current and Previous Month The distribution of investments in the portfolio both in dollars and as a percentage of the total portfolio by funds is as follows: May 2012 % Alloc June 2012 % Alloc Fund Description Balance 5/31/2012 Balance 6/30/2012 Water Operating Reserve $ 4,154,546 16.25% $ 3,622,785 16.71% Water Emergency Reserve 1,007,968 3.94% 1,000,992 4.62% Water Capital Project Reserve 14,903,665 58.30% 11,248,023 51.88% Water Reserve for Debt Service 735,690 2.88% 1,021,981 4.71% Maintenance Reserve 180,452 0.71% 200,000 0.92% COP Revenue Bond 2008- Reserve 2,161,022 8.45% 2,160,486 9.97% COP Revenue Bond 2008 17,248 0.07% 14,549 0.07% Sewer Operating 221,537 0.87% 204,380 0.94% Sewer Emergency Reserve 1,007,318 3.94% 999,991 4.61% Sewer Capital Project Reserve 1,172,620 4.59% 1,206,979 5.57% $ 25,562,066 100.00% $ 21,680,166 100.00% Wells Fargo Bank Checking Water Operating 71,263 9,301 Sewer Operating 163,571 55,627 234,834 64,927 Totals $ 25,796,900 $ 21,745,093 ITEM NO. 3.1 AGENDA REPORT Meeting Date: July 23, 2012 To: Finance-Accounting Committee Presented By: Stephen Parker, Finance Dept: Finance Manager Prepared By: Stephen Parker, Finance Manager Subject: Auditor Discussion with Those In Governance DISCUSSION: Nitin Patel, Partner, and Daphnie Munoz, Partner, from White Nelson Diehl Evans LLP will address the Finance-Accounting Committee with information pertaining to the upcoming audit of the fiscal year ending June 30, 2012. They will also be available for any questions the Committee may have. STRATEGIC PLAN: FR 1-13: 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): On May 26, 2011 the Board authorized the President and Secretary to execute a Professional Services Agreement with Diehl, Evans & Company for a three year contract with two subsequent one-year options for a fee not to exceed $97,695. ITEM NO. 3.3 AGENDA REPORT Meeting Date: July 23, 2012 To: Finance-Accounting Committee Presented By: Stephen Parker, Finance Dept: Finance Manager Prepared By: Stephen Parker, Finance Manager Subject: Broker Dealer Approval DISCUSSION: Staff has completed the process of vetting Matthew D'Avanzo, Senior Vice-President - Fixed Income Strategies at First Empire Securities as a broker/dealer. Resolution No. 11-24 adopted the current investment policy. Section 9 states: Before a broker/dealer is used, they are subject to investigation and approval by the General Manager or the designated representative and must submit the following: • Certification of having read and understood this investment policy resolution and agreeing to comply with the District's investment policy; • Proof of National Association of Security Dealers certification and state registration; • Compliance with federal capital adequacy regulations and provide documentation of financial solvency; • Provide audited financial statements within 120 days of fiscal year end; • Provide similar services to other public-sector clients. Mr. D'Avanzo currently provides broker/dealer services in southern California for the City of Irwindale, City of Stanton, City of Diamond Bar, City of Lomita and the City of Seal Beach. Staff is still in the process of vetting other broker/dealers, and intends to complete a large scale revision to the investment policy with legal council's help prior to making investments through Mr. D'Avanzo. ITEM NO. 3.4 AGENDA REPORT Meeting Date: July 23, 2012 To: Finance-Accounting Committee Presented By: Stephen Parker, Finance Dept: Finance Manager Prepared By: Stephen Parker, Finance Manager Subject: Upcoming Pension Accounting Changes SUMMARY: In February staff reported on upcoming pension accounting changes initiated by the Governmental Accounting Standards Board (GASB). On June 25, 2012, GASB voted to approve a new standard affecting pensions - Statement No. 68, Accounting and Financial Reporting for Pensions. Statement No. 68 revises and establishes new financial reporting requirements for most governments that provide their employees with pension benefits. Statement No. 68 replaces the requirements of Statement Nos. 27 and 50. Statement 68 requires governments providing defined benefit pensions to recognize their long-term obligation for pension benefits as a liability for the first time, and to more comprehensively and comparably measure the annual costs of pension benefits. The Statement also enhances accountability and transparency through revised and new note disclosures and required supplementary information (RSI). The key changes are that: • Net pension liabilities will be reported on the balance sheet. • Projections of benefit payments to employers will be based on the then-existing benefit terms as well as projected automatic post employment benefit changes. DISCUSSION: GASB is the rule-setting body responsible for reporting standards in accounting - otherwise known as generally accepted accounting principles. GASB has recently written an exposure draft on amending GASB 27 - the rule for pension accounting standards for employers in cost sharing and multiple-employer plans (the category that YLWD falls into). An exposure draft provides for comments by affected parties and potentially allows time for the rules as proposed to be revised. Staff previously shared proposed changes by GASB, and is now sharing updated information learned at the recent Government Finance Officers Association conference. GASB is proposing changing the way that the liability of pensions are recorded on the financial statements. Namely, • Putting the entire pension liability on the balance sheet instead of the current footnote disclosure by recognizing the employer's "proportionate share" of collective net pension liability and pension expense. This is the component that is most probably not going to be included when GASB is likely to adopt the amendment in or about June 2012. • Changing the discount rate (the rate at which future benefit payments are discounted to their present value) from the current expected rate of return (7.75% assumed by PERS) to either a risk-free rate of return (average bond rates) or a combination of long-term rate of return until current assets are depleted, then risk free thereafter. • Shortening the amortization period for recognizing large changes. Currently PERS spreads theirs over 15 years and recently performed a 3-year smoothing of one of the 15 years' effects. The recommendation would be to recognize changes over the remaining service lives of individual plan members. • Recognizing investment earnings variance from projected within 5 years, which is a major departure from PERS' current method. • Other items that would not affect YLWD as dramatically, so are not explored in detail here. The effect of these changes will be that the pension cost shown on the financial statements will increase from what is currently shown in the footnotes. In addition, there might be a different amount disclosed on the footnotes as compared to the financial statements. As a result of these changes, either PERS will have to change the way they complete actuarials, or Districts' will have to engage their own actuaries. It is also likely that whatever changes are accomplished on the pension side will follow for Other Post-Employment Benefits in a few years. At this point there are a lot more questions than answers. More information will be available in the coming months, but the effective date that these changes are required to be implemented by the District is FY 2013/14. ITEM NO. 3.5 AGENDA REPORT Meeting Date: July 23, 2012 To: Finance-Accounting Committee Presented By: Stephen Parker, Finance Dept: Finance Manager Prepared By: Delia Lugo, Senior Accountant Subject: June 2012 Budget to Actual Results DISCUSSION: Attached are the District's budget to actual summary results for the Water Fund, Sewer Fund and a combined statement for both funds pertaining to the reporting month of June 2012. Water operating revenue ended the year at only 90.4% of the budgeted figure. Our 20 by 2020 baseline is 298.1 gallons per capita per day (GPCD), with a target of 238.59. For the current fiscal year through June 2012, the reduction of 40 GPCD brings us 63% of the way to our goal. District salary related expenses are well below budget by $1 million at the fiscal year end. This is due to less than anticipated health related expenses, unbudgeted Capital Project Labor, and unfilled budgeted personnel. This figure will decrease slightly when the full accrual numbers come out next month. The majority of the Water Fund's individual Supplies and Services expenses are trending below or near budget, with the exception of Materials primarily due to unbudgeted replacement meter purchases and Professional Services primarily due to legal expenses related to Freeway Complex Fire litigation. An item to note is the extraordinary item in the amount of $5 million, which is a one- time District expense pertaining to the Freeway Complex Fire. Sewer Other Operating Revenue is well over budget due to the Vista del Verde Project as reported in previous months. Sewer Other Non-Operating revenue is also well over budget, primarily due to receiving $264,000 from the City of Yorba Linda for the sewer transfer. The Sewer Funds Supplies and Services expenses are trending below or on budget, with the exception of Maintenance, which is higher due to the cost of sewer main repairs on Woodcrest, Los Altos Trail, Yorba Linda Blvd, and at the flood control easement. ATTACHMENTS: Description: Type: June 2012 Combined.xls June 2012 Consolidated Statement Backup Material June 2012 Water.xlsx June 2012 Water Statement Backup Material June 2012 Sewer.xls June 2012 Sewer Statement Backup Material Yorba Linda Water District Summary Financial Report Water&Sewer Funds For Twelve Months Ending June 30, 2012 Original YTD YTD YTD Budget Actual Under(Over) % of FY 2012 FY 2012 Budget Budget Revenue (Operating): Water Revenue (Residential) $17,904,893 $15,243,341 $2,661,552 85.14% Water Revenue (Commercial & Fire Det.) 1,726,651 1,820,913 (94,262) 105.46% Water Revenue (Landscape/Irrigation) 3,757,058 3,687,643 69,415 98.15% Water Revenue (Service Charge) 3,406,392 3,369,439 36,953 98.92% Sewer Charge Revenue 1,548,550 1,546,076 2,474 99.84% Locke Ranch Assessments 159,862 203,398 (43,536) 127.23% Other Operating Revenue 754,361 832,131 (77,770) 110.31% Total Operating Revenue: 29,257,767 26,702,941 2,554,826 91.27% Revenue (Non-Operating): Interest 190,000 258,155 (68,155) 135.87% Property Tax 1,232,000 1,249,609 (17,609) 101.43% Other Non-Operating Revenue 499,369 795,959 (296,590) 159.39% Total Non-Operating Revenue: 1,921,369 2,303,723 (382,354) 119.90% Total Revenue 31,179,136 29,006,664 2,172,472 93.03% Expenses (Operating): Variable Water Costs (G.W., Import& Power) 13,671,538 12,263,870 1,407,668 89.70% Salary Related Expenses 7,941,306 6,749,031 1,192,275 84.99% Supplies &Services 4,070,833 3,703,303 367,530 90.97% Total Operating Expenses 25,683,677 22,716,204 2,967,473 88.45% Expenses (Non-Operating): Interest on Long Term Debt 1,906,426 1,884,645 21,781 98.86% Other Expense 123,193 106,429 16,764 86.39% Total Non-Operating Expenses: 2,029,619 1,991,074 38,545 98.10% Total Expenses 27,713,296 24,707,278 3,006,018 89.15% Net Income(Loss) Before Capital Contributions 3,465,840 4,299,386 833,546 124.05% Extraordinary Item(s) - (5,000,000) (5,000,000) 0.00% Contributed Capital - 17,212,116 17,212,116 0.00% Net Income(Loss) Before Depreciation 3,465,840 16,511,502 13,045,662 476.41% Depreciation &Amortization 5,561,699 6,594,261 (1,032,562) 118.57% Total Net Income (Loss) ($2,095,859) $9,917,241 $12,013,100 -473.18% Capital- Direct Labor (377,576) 377,576 Yorba Linda Water District Water Fund For Twelve Months Ending June 30, 2012 June YTD YTD YTD Budget Actual Actual Under(Over) %of FY 2012 FY 2012 FY 2012 Budget Budget Revenue(Operating): Water Revenue (Residential) $17,904,893 $1,404,719 $15,243,341 $2,661,552 85.14% Water Revenue (Commercial &Fire Det.) 1,726,651 151,267 1,820,913 (94,262) 105.46% Water Revenue (Landscape/Irrigation) 3,757,058 363,979 3,687,643 69,415 98.15% Water Revenue (Service Charge) 3,406,392 281,130 3,369,439 36,953 98.92% Other Operating Revenue 697,360 79,565 728,114 (30,754) 104.41% Total Operating Revenue: 27,492,354 2,280,660 24,849,450 2,642,904 90.39% Revenue(Non-Operating): Interest 170,000 13,379 236,517 (66,517) 139.13% Property Tax 1,232,000 13,899 1,249,609 (17,609) 101.43% Other Non-Operating Revenue 495,394 35,092 538,382 (42,988) 108.68% Total Non-Operating Revenue: 1,897,394 62,370 2,024,508 (127,114) 106.70% Total Revenue 29,389,748 2,343,030 26,873,958 2,515,790 91.44% Expenses(Operating): Variable Water Costs(G.W., Import& Power) 13,671,538 1,259,797 12,263,870 1,407,668 89.70% Salary Related Expenses 6,953,531 417,746 5,914,655 1,038,876 89.40% Supplies&Services: Communications 369,303 7,577 175,263 194,040 47.46% Contractual Services 527,888 22,161 381,351 146,537 72.24% Data Processing 119,645 5,196 120,313 (669) 100.56% Dues&Memberships 55,973 345 53,649 2,324 95.85% Fees&Permits 140,030 5,293 127,978 12,052 91.39% Insurance 221,526 - 221,802 (276) 100.12% Materials 361,161 34,480 481,142 (119,981) 133.22% District Activities, Emp Recognition 20,758 1,012 12,064 8,694 58.12% Maintenance 418,603 44,367 397,889 20,714 95.05% Non-Capital Equipment 79,221 30,787 94,574 (15,353) 119.38% Office Expense 45,686 3,078 42,245 3,441 92.47% Professional Services 794,406 97,958 839,458 (45,052) 105.67% Training 49,964 1,109 26,035 23,929 52.11% Travel &Conferences 48,221 753 18,136 30,085 37.61% Uncollectible Accounts 35,340 - 21,833 13,507 61.78% Utilities 114,855 2,876 61,650 53,205 53.68% Vehicle Equipment 278,209 17,423 278,047 162 99.94% Supplies&Services Sub-Total 3,680,788 274,415 3,353,429 327,359 91.11% Total Operating Expenses 24,305,857 1,951,958 21,531,954 2,773,903 88.59% Expenses (Non-Operating): Interest on Long Term Debt 1,906,426 155,938 1,884,320 22,106 98.84% Other Expense 117,193 2,947 90,489 26,704 77.21% Total Non-Operating Expenses: 2,023,619 158,885 1,974,809 48,810 97.59% Total Expenses 26,329,476 2,110,843 23,506,763 2,822,713 89.28% Net Income(Loss) Before Capital Contributions 3,060,272 232,187 3,367,195 306,923 110.03% and Transfers Extraordinary Item(s) - (5,000,000) (5,000,000) (5,000,000) 0.00% Transfers(To)/From - - (85,111) (85,111) 0.00% Capital Contributions - 81,704 98,241 98,241 0.00% Net Income(Loss) Before Depreciation 3,060,272 (4,686,109) (1,619,675) (4,679,947) -52.93% Depreciation &Amortization 4,628,999 449,583 5,359,302 (730,303) 115.78% Total Net Income(Loss) ($1,568,727) ($5,135,692) ($6,978,977) ($5,410,250) 444.88% Capital - Direct Labor (301,548) 301,548 Yorba Linda Water District Sewer Fund For Twelve Months Ending June 30,2012 June YTD YTD YTD Budget Actual Actual Under(Over) %of FY 2012 FY 2012 FY 2012 Budget Budget Revenue(Operating): Sewer Charge Revenue $1,548,550 $129,541 $1,546,076 $2,474 99.84% Locke Ranch Assessments 159,862 7,799 203,398 (43,536) 127.23% Other Operating Revenue 57,001 2,148 104,017 (47,016) 182.48% Total Operating Revenue: 1,765,413 139,488 1,853,491 (88,078) 104.99% Revenue(Non-Operating): Interest 20,000 2,019 21,638 (1,638) 108.19% Other Non-Operating Revenue 3,975 75 257,577 (253,602) 6479.92% Total Non-Operating Revenue: 23,975 2,094 279,215 (255,240) 1164.61% Total Revenue 1,789,388 141,582 2,132,706 (343,318) 119.19% Expenses(Operating): Salary Related Expenses 987,775 58,326 834,376 153,399 87.41% Supplies&Services: Communications 27,797 570 15,133 12,664 54.44% Contractual Services 39,733 1,703 29,998 9,735 75.50% Data Processing 9,006 391 9,055 (50) 100.55% Dues&Memberships 4,213 296 4,783 (570) 113.53% Fees&Permits 10,540 324 7,700 2,840 73.06% Insurance 16,674 - 16,667 7 99.96% Materials 27,184 367 21,052 6,132 77.44% District Activities, Emp Recognition 1,562 76 907 655 58.05% Maintenance 74,267 27,070 134,187 (59,920) 180.68% Non-Capital Equipment 18,799 3,533 16,800 1,999 89.37% Office Expense 3,439 907 3,834 (395) 111.49% Professional Services 59,794 4,202 34,310 25,484 57.38% Training 3,761 59 4,320 (559) 114.87% Travel&Conferences 3,630 57 1,298 2,332 35.76% Uncollectible Accounts 2,660 - 1,162 1,498 43.68% Utilities 8,645 244 5,122 3,523 59.25% Vehicle Equipment 78,341 2,248 43,546 34,795 55.59% Supplies&Services Sub-Total 390,045 42,047 349,874 40,171 89.70% Total Operating Expenses 1,377,820 100,373 1,184,250 193,570 85.95% Expenses(Non-Operating): Interest Expense - - 325 (325) 0.00% Other Expense 6,000 - 15,940 (9,940) 265.67% Total Non-Operating Expenses: 6,000 16,265 (10,265) 271.08% Total Expenses 1,383,820 100,373 1,200,515 183,305 86.75% Net Income(Loss) Before Capital Contributions 405,568 41,209 932,191 526,623 229.85% and Transfers Transfers(To)/From - - 85,111 85,111 0.00% Contributed Capital - - 17,113,875 17,113,875 0.00% Net Income(Loss) Before Depreciation 405,568 41,209 18,131,177 17,725,609 4470.56% Depreciation&Amortization 932,700 106,275 1,234,959 (302,259) 132.41% Total Net Income(Loss) (527,132) (65,066) 16,896,218 17,423,350 -3205.31% Capital-Direct Labor (1,462) (29,051) 29,051 ITEM NO. 3.6 AGENDA REPORT Meeting Date: July 23, 2012 Subject: Status of Strategic Plan Initiatives DISCUSSION: Attached are the strategies overseen by the Finance-Accounting Committee identified in the 2011- 2013 Strategic Plan, which was updated in the FY 12/13 budget, that relate to Fiscal Responsibility. Included is an update on each strategy relating to Fiscal Responsibility. ATTACHMENTS: Name: Description: Type: Strategic Plan Tracking- FA.xlsx Strategic Plan Tracking-FA Backup Material Strategic Plan Initiatives Status Report Finance-Accounting Committee Strategies Lead Party Comments July 2012 Progress FR 1: Maintain Fiduciary Responsibilitv Revise the Water and Sewer Rules General Complete Study in House Water Rules and Regulations and Fee Schedule was approved by the Board on March FR 1-C and Regulation and Evaluate Fee Manager/ and Recommend Fees g 2012. Sewer Rules and Regulations and Fee Schedule will be brought before the Schedules Regularly for Proper Finance Director Structure Update for Board in the fall of 2012. Cost of Service Coverage Adoption by December 2011 Continue to Record and Report the Quarterly the Board receives Fairly Stated Financial Activities of General full-accrual financial The Board received the March 2012 investment report at the May 10th Board FR 1-F the District in a Timely and Manager/ statements. The annual meeting and the 3rd quarter full-accrual financial statements at the June 14th Transparent Manner to the Board Finance Director audit is provided timely to Board meeting. of Directors and Member Agencies the Board and public. Continue to Improve Communications of the District's General Monthly financial information The Finance-Accounting Committee received the June 2012 investment report FR 1-G Financial Information to the Board Manager/ is provided to management and the June budget to actual financial statements at the July 23rd Committee of Directors,Member Agencies, Finance Director an d the Finance-Accounting meeting. Management,and the Financial Committee. Community Completed Strategies Lead Party Comments July 2012 Progress Prepare a High Level Annual Budget Document and FY 2011/12 Budget and CAFR for period ending June 30, 2011 received Government FR 1-B Comprehensive Annual Financial Finance Director Include Fees in FY 2011/12 Finance Officer's Association awards for excellence. FY 2012/13 Budget approved by Report and Compete for Budget the Board on June 28, 2012. Staff will submit for CSMFO and GFOA budget awards Recognition by the Government in August. Finance Officers Association Substantial Rate Increase FR 1-E Maintain Commitment to Strong Board of Adopted in Sept 2009 Quarterly review of debt service ratios will continue as well as integrating the ratio into Debt Services Ratio Directors followed by Pass Through forward financial projections. Increase in Aug 2010 Latest Revisions Reviewed by Review the Reserve Policy and Finance Finance-Accounting Completed review/revision of reserve policy for FY 12/13. Reserve policy adopted by FR 2-A Funding Levels Annually Director/Board Committee for Board of the Board on June 14, 2012. of Directors Directors to Consider in Jun- 11 Finance Financial model allowed review of reserves on a long-term basis. Staff recommended a FR 2 C Implement an Approach to Ensure Director/Board Rates, COP's and Other 3-year rate increase to ensure reserves are responsibly funded. Board voted to Reserves are Responsibly Funded p y of Directors f Di Directors Capital Financing Options p g p approve 1.5 1.5 2.5%rate increase on the fixed charge plus a change in the pp ' ' g p g fixed charge to be based on the meter size at the Public Hearing on June 21. Manage Cash Flow to Maximize Track Opportunities and Delia Lugo, Senior Accountant reviews the cash balances and needs daily. Mutfiple FR 3-C Investment Income Finance Director Effectiveness with Quarterly times a month,excess cash is transferred to investments to earn interest until the next Investment Reports check register.