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HomeMy WebLinkAbout2014-06-12 - Resolution No. 14-08RESOLUTION NO. 14 -08 RESOLUTION OF THE BOARD OF DIRECTORS OF THE YORBA LINDA WATER DISTRICT ADOPTING THE BUDGET FOR FISCAL YEAR 2014/15 AND RESCINDING RESOLUTION NO. 13 -10 WHEREAS, the Yorba Linda Water District has prepared a one year budget for Fiscal Year 2014/15; and WHEREAS, on May 22, 2014, the proposed "Draft" Budget for Fiscal Year 2014/15 was presented and reviewed at a regular meeting of the Board of Directors of the District; and WHEREAS, it is the desire of the Board of Directors to adopt the Budget for Fiscal Year 2014/15, and rescind Resolution No. 13 -10. NOW THEREFORE BE IT RESOLVED by the Board of Directors of the Yorba Linda Water District as follows: Section 1. That the Budget for Fiscal Year 2014/15, set forth in Exhibit "A" attached hereto, is hereby approved and adopted. Section 2. The Budget for Fiscal Year 2014/15 is in full force and effect beginning July 1, 2014, and continuing until this Resolution is rescinded by the Board of Directors. Section 3. That Resolution No. 13 -10 is hereby rescinded effective July 1, 2014. PASSED AND ADOPTED this 12th day of June 2014, by the following called vote: AYES: Directors Beverage, Collett, Hawkins, Kiley and Melton NOES: None ABSTAIN: None ABSENT: None Rob &t R. Kiley, President Yorba Linda Water District Resolution No. 14 -08 Adopting the Budget for FY 2014/15 ATTEST: Steven R. Conklin, Board ecretary Yorba Linda Water District Reviewed as to form by General Counsel: Arthur . Kid man, Esq. Kidman Law LLP Resolution No. 14 -08 Adopting the Budget for FY 2014/15 ester nda istrict Table of Contents LETTER OF TRANSMITTAL 4 BUDGET OVERVIEW Resolution 12 -14 Adopting FY 2013/14 Budget 15 GFOA Distinguished Budget Award FY 2012/13 16 Mission & Vision Statement 17 Core Values Statement 18 Strategic Goals Statement 19 Strategic Plan 20 Profile of the District 30 Board of Directors & Executive Staff 32 Organizational Chart 33 Personnel Trends by Position 34 Personnel Trends by Department 37 Financial Policies & Goals 38 Basis of Budgeting & Accounting 40 Budget Controls 40 Budget Process 42 Budget Calendar 43 Revenue Assumptions 44 Cost Allocation 48 Chart of Major Funds Structure 48 Rate History 49 Average Residential Monthly Bill by Year 50 Demographics 51 YLWD Service Area 53 Ten Largest Customers Most Recent and Ten Years Ago 54 IaIki I_\ki [a] ►1►fi1_l: 1:K Total Revenue and Expenses (Water & Sewer) 56 Total Revenue and Expenses (Water) 58 Total Revenue and Expenses (Sewer) 60 Total Revenues by Fund 62 Total Expenses by Fund 63 Total Expenses by Category 64 Five Year Cost Comparison 64 Variable Water Cost Expenses 65 Reserves and Funding Sources 66 Projected Reserves & Funding Levels 67 Five Year Financial Projections 68 Fund Balance History 74 Debt Administration 75 Employees per Capita 76 Residential Meter Charge Comparison 77 CAPITAL PROJECTS Capital Improvement Plan 80 Capital Projects Summary 82 Vehicle Equipment and Capital Outlay 85 DEPARTMENT SUMMARIES Board of Directors 88 Administration 96 Engineering 108 Finance 122 Human Resources 136 Information Technology 150 Operations 166 APPENDIX List of Acronyms 187 Glossary of Terms 190 Financial Policies 195 ❖ Operating Budget Policy 196 ❖ Revenues and Expenditures Policy 198 ❖ Financial Reserves Policy 200 ❖ Investment Policy 205 VLM ANNUAL OPERATING BUDGET FISCAL' Letter of Transmittal = -LM ANNUAL OPERATING W To the Honorable Board of Directors: We are pleased to present the Yorba Linda Water District FY 2014/15 Draft Budget. The purpose of this document is to identify and allocate the resources needed to accomplish the District's goals and objectives over the next fiscal year and to present the financial health of the District in a clear and concise manner to the Board of Directors and the general public. The main objective of the proposed Yorba Linda Water District FY 2014/15 budget is to provide adequate funding for all District activities, considering the goals of maintaining exemplary customer service and meeting all regulatory requirements in a financially prudent manner. The proposed budget meets this objective by incorporating operating cost reductions and the use of available financial reserves, while projecting realistic operating revenues without a supplement from the currently approved rate increases. The following are upcoming goals as outlined by the District's Strategic Plan, as well as highlights of achievements completed in FY 2013/14; a summary of the goals and objectives for FY 2014/15 and a financial forecast of the District heading into the next five fiscal years: FY 2011/13 Strategic Plan Goals In the latter part of Fiscal Year 2010/11, the District adopted a Strategic Plan that established a foundation to meet and adapt positively to a changing work environment. Priority objectives were identified and resources were allocated in the FY 2011/12 Adopted Budget to achieve many of these objectives on the short term and to begin working toward achieving the longer term objectives as well. Specific goals and objectives were updated based on level of achievement during FY 2011/12. At the beginning of FY 2012/13, however, the Board of Directors opted to take a more proactive approach to public service, through the authorization of an Operations and Efficiency Study of the agency, which was concluded in FY 2013/14. The independent assessment of the District was aimed at taking the organization to the next level, with an eye to the future, including offering insight on best practices in the industry and exploring potential cost - saving measures. Based on the findings and recommendations of the study, the District is considering some organizational adjustments as well as possible changes in direction and focus. Until such time as the Board of Directors, in conjunction with staff, has concluded implementation of the major recommendations, the District has opted to extend the FY 2011/13 Strategic Plan Goals for another fiscal year. = -LM ANNUAL OPERATING W The departmental goals and objectives are included in the Department Summaries section of this budget. The full list of goals, initiatives and strategies within the Strategic Plan can be found starting on page 19 of this document. The five goals that the District identified as the most critical are as follows: Goal CP: Community Partnership Goal FR: Fiscal Responsibility Goal OE: Operational Efficiency Goal SR: Service Reliability Goal WE: Workforce Engagement FY 2013/14 Highlights & Accomplishments Capital Improvement & Replacement Projects Completed • Completed Construction of 2012 Waterline Project • Completed Construction of Elk Mountain Booster Surge Tank • Completed Construction of Yorba Linda Boulevard Pipeline Project Projects in Planning, Design or Commencing Construction • Commenced Construction of Yorba Linda Booster Station Project • Commenced Construction of Well #21 • Commenced Design of Fairmont Booster Pump Station Replacement Project Other District Activities & Accomplishments • Received Positive Auditors Letter for FY 2012/13 • Received State and National Recognition for CAFR • Received State and National Recognition for FY 2013/14 Budget document • Executed Multi -Year Memorandum of Understanding (MOU) • Annexation to OCWD Approved FY 2013/14 Financial Forecast For the year ending June 30, 2014, staff is anticipating a combined loss of $761,450 for the water and sewer enterprises. These figures include total depreciation expenses (a non -cash expense) in the amount of $7,270,308. Please refer to the Summary of Total Revenue and Expenses (Water & Sewer) for supporting information (pg.56). Beginning July 1, 2013, the total reserve funds available for both Operations and Capital Projects was $19.6 million. Staff is forecasting these funds to be $20.2 million by June 30, 2014, for a total addition of $600,000 for FY 2013/14. Please see the Reserves and Funding Sources table for supporting information (pg. 66). Principal Issues, Factors & Challenges for FY 2014/15 For the forthcoming 2014/15 fiscal year, a primary factor affecting an increase in the expenses of the District is the cost of water YLWD pays to the Municipal Water District of Orange County (MWDOC) for import water and assessments. MWDOC's cost is primarily based on the cost of water they must pay to the Metropolitan Water District of Southern California (MWD). MWD adopted an average 3.7% rate increase, effective January 1, 2015; however, this is part of a 24% increase over the last five years. In the upcoming fiscal year, import water will account for 40% of our water purchases at 67% of the total variable water costs budget. Variable water costs in total comprise 55% of the District's operating expenses and ensuring these costs are held as low as possible is a top priority each fiscal year. To this end, as of May 2014, the District was granted annexation of the remaining 26% of its service area into the Orange County Water District (OCWD). It is anticipated that with full annexation the District will be able to pump the maximum groundwater allowable each year, at a lower cost than purchasing the same amount of import (MWD) water. However, the District will not be able to take advantage of full annexation for FY 2014/15 due to the 2003 Conjunctive Use Program (CUP) Agreement and due to the need to complete construction of capital facilities. The CUP Agreement requires the District to withdraw 2,193 acre -feet over and above OCWD's Basin Production Percentage (BPP) for the upcoming fiscal year and pay for the water at current import water rates, after subtracting power and operations and maintenance charges of $132 per acre -foot. The CUP allows MWD to "store" water in the Orange County Groundwater Basin and call for the extraction of that water, via wells purchased for various agencies, in times of drought when its traditional sources (the Colorado River and Bay - Delta) are less plentiful. Current facility limitations will challenge the District in producing and transferring the full BPP as well as the required CUP obligation. Had the District been able to access the entirety of the BPP in the upcoming fiscal year, the District could potentially lower its variable water costs by approximately $1 million. As later described in this document, the District's Capital Improvement Program includes construction of pumping, pipeline and well facilities over the next three years that will make it possible for the District to access its full allotment of groundwater. In addition, with an extended dry season lasting most of the year the District has sold more water than originally budgeted for FY 2013/14. This amounts to an increase in water sales revenue of $1.5 million. Over the past three fiscal years the District has averaged annual sales of 19,907 acre -feet; however, the District has budgeted for 21,980 acre -feet of water sales for FY 2014/15. The increased budget is based on the current year's forecasted usage of 22,343 acre feet. 17rL ANNUAL OPERATING As of July 1, 2012, the Board of Directors approved a three -year rate increase to customers on the Monthly Service Charge. The increase was on the District's overall revenue and consisted of 1.5% beginning on July 1, 2012, an additional 2.5% increase on July 1, 2013, and the last of the three -year increase of 2.5% beginning July 1, 2014. The increases will assist in covering the costs associated with operating, maintaining and replacing the District's water system facilities. In conjunction with this rate increase, the Board of Directors approved a $7 million line of credit with a 3 -year term and an interest rate based on 1 month LIBOR, which currently calculates to 1.10 %. The use of the line of credit will allow the District to proceed with capital improvement projects with a minimal borrowing cost and a lowered financial burden to our customers. For FY 2014/15, the following goals and objectives have been established: FY 2013/14 Goals & Objectives Key Business Objectives • Continue to Implement, Evaluate and Update the Financial Reserves Policy • Continue Implementation of the District's Computerized Maintenance and Management System (CMMS). • Pursue Opportunities for Expanded Sewer Service Area • Update Current Job Descriptions (District -wide) Customer Service and Public Affairs Enhancements • Effectively Use Broad - Spectrum Communication Opportunities • Encourage Continued Employee Training in Leadership and Technology. • Complete Implementation of Recommendations from the Operations & Efficiency Study Capital Improvement & Replacement Projects • Begin Construction of Fairmont Booster Pump Station Project • Continue Construction of Well 21 • Complete Construction of Yorba Linda Booster Station Project • Locate site and purchase property for proposed Well 22 FY 2014/15 Summary Budget Revenues Total water and sewer revenues budgeted for upcoming FY 2014/15 amount to $33 million, an increase of $1.2 million from the revenues budgeted for FY 2013/14. The major differences are comprised of the following: = -LM ANNUAL OPERATING W Water Revenue ($990,000 increase) Residential water revenue is expected to increase by $937,000 in FY 2014/15 due to an unusually dry winter and the anticipation of a dry and hot summer. Weather is typically the largest driver in residential water use as 60 % -70% is used specifically in outdoor irrigation. Landscape and Irrigation water revenue is expected to remain relatively stable, with only a $53,000 increase for FY 2014/15 because this revenue is generated from larger customers such as the City of Yorba Linda, the Placentia - Yorba Linda Unified School District and various homeowners associations, which are anticipated to continue maintaining landscaped community areas at a certain level in order to maintain their investment in this landscaping. Revenues for Residential, Commercial and Landscape customers assume a voluntary 5% reduction in usage due to the declaration of drought and the extensive public information campaigns. Service Charges for all customers, which assist in covering the District's fixed costs, are expected to increase by $9,300 for FY 2013/14 which will bring the budget more in line with the forecasted charges. Other operating revenue for water, which is comprised of fluctuating income such as various rebates and refunds, is expected to decrease by $11,000. Sewer Charge Revenue ($54,762 increase) Sewer Charge Revenue funds help to finance maintenance equipment, system repairs, replacements and improvements associated with the sewer system. This revenue is expected to remain relatively constant. Expenses & Outlay Total expenses & outlay (excluding capital projects) budgeted for upcoming FY 2014/15 is $36.7 million, an increase of $2 million from the FY 2013/14 budgeted results. This includes depreciation which totals $7.3 million. The following factors summarize the significant changes: Variable Water Costs ($1,161,000 increase) The District's variable water costs will increase in FY 2014/15 due to multiple factors including another increase in the water rate the District pays to MWDOC for imported water. MWDOC's increase is primarily a pass through from an average 3.7% increase in MWD rates. In addition to the increase from MWD rates, the District is budgeting to sell nearly 2,000 acre -feet more than was budgeted for FY 2013/14. The FY 2014/15 budget was established using the previous three -year average usage of 19,907 acre -feet, however taking into account that calendar year 2013 was the driest year on record in the state of California, the District is anticipated to sell 22,343, approximately 2,000 acre -feet more than originally budgeted and far beyond the previous three -year average. The California Department of Water Resources anticipates that the current drought conditions will continue through FY 2014/15. ANNUAL OPERATING W Salaries & Benefits ($340,000 increase) This amount includes merit increases and reclassifications for those employees who may qualify throughout the year, increases from CalPERS, medical, dental, and vision premiums, and the assumption that all funded positions will be filled for an entire fiscal year. The FY 2014/15 budget for merit increases for those employees who qualify throughout the year, amounts to approximately $58,000. The Salaries & Benefits budget also includes the deletion of one full -time employee and one part -time employee, as well as four proposed reclassifications of current employees. Salaries relating to CIP projects, in the amount of $285,000, will also be capitalized. The net operating costs for salaries and benefits results in a $320,000 increase from the FY 2013/14 budget. The District pays 100% of the premium cost for health, dental and vision for all full -time employees and two - thirds of the premium cost for their dependents; participates in CaIPERS (2% @ 55) for full time employees hired prior to January 26, 2012; offers employees a "4/10" work schedule; an optional 457 deferred compensation plan; a 125 Flex benefits plan; Long and Short Term Disability Insurance; Life Insurance; an Employee Assistance Program; and Tuition Reimbursement. As a result of the financial crisis of 2007 -2010, the combined loss of nearly $67 billion in 2008 and 2009 in market value for the California Public Employees' Retirement System (CaIPERS), and the CalPERS Board voting to reduce the discount rate assumption from 7.75% to 7.5 %, the employer's share percentage has increased for FY 2014/15. In previous years, the District paid the employees' full 7% statutory CalPERS employee contribution rate to CalPERS. Full -time employees who are already part of the CalPERS system and who were hired after January 26, 2012 participate in CaIPERS (2% @ 60) and pay their own 7% statutory CalPERS employee contribution rate to CalPERS. Due to pension reform requirements, full -time employees hired after January 1, 2013 who are new members to CalPERS participate at (2% @ 62) retirement formula and pay the 6.25% member contribution rate to CaIPERS. Beginning in FY 2012/13, the District signed a Letter of Compensation and Terms for Employment with all Management and Supervisory /Confidential employees resulting in these employees paying their own portion of the 7% statutory CalPERS employee contribution rate to CaIPERS retirement by the third year of the three -year term. In FY 2012/13, these employees paid 3% of the 7% statutory CalPERS employee contribution rate to CalPERS with the District paying the remaining 4 %. In FY 2013/14, these employees paid 5% of the 7% statutory CalPERS employee contribution rate, with the District paying the remaining 2 %; and effective July 1, 2014, these employees will pay the full 7% statutory CalPERS contribution rate, with the District covering only the employer portion of the contribution. The move to employees paying the 7% statutory CalPERS employee contribution rate was offset by a Cost -of- Living Increase (COLA) of 9% over three years, beginning in FY 2012/13. This was the first COLA for employees since FY 2008/09. �- YL ANNUAL OPERATING -` Beginning on July 1, 2012, the District matched dollar for dollar the salary earned, not to exceed 2% per payroll period, of the employee's deposits into a qualified Deferred Compensation Plan for any Management or Supervisory /Confidential employee. Employees accrue 3.077 hours per pay period of vacation with increases in vacation accruals at 5, 10, 15 and 20 years. After 20 years, the maximum vacation accrual is reached at the rate of 6.922 hours per pay period. There are 26 pay periods per year. Sick leave is accrued at the rate of 3.7 hours per pay period. The District observes eleven paid holiday per year. The District signed a successor Memorandum of Understanding with all Bargaining Unit employees. These employees began paying a portion of the 7% statutory CalPERS employee contribution rate to CalPERS retirement on July 1, 2012. Bargaining Unit employees will pay the full statutory CalPERS employee contribution starting on July 1, 2014. Reserves and Funding Sources The District has ten water and sewer enterprise - related funding sources. Within the budget document is a summary of these funding sources and their associated balances. Five of these funds are restricted or designated specifically for capital projects including: COP Bonds 2008, Water Capital Projects and Sewer Capital Projects. Both the Water Emergency and the Sewer Emergency Funds are non - restricted and were established to fund unplanned, unbudgeted emergency operations repairs related to the water and sewer system, respectively. The Water Emergency Fund was established in FY 2009/10, with a transfer of $2 million from the Annexation Fund. The Sewer Emergency Fund was established in FY 2007/2008, with the Board of Directors' decision that approximately $1 per connection per month would be set to fund this account. The Board also established at that time a Sewer Emergency Fund ceiling guideline of $1 million, after which any additional revenue generated would be transferred to Sewer Capital Reserves. The remaining five funds are the Water Restricted for Debt Service Fund, which is used to pay the Districts principal and interest payments, the Water and Sewer Operating Funds which are used to fund day -to -day operations and maintenance activities as identified in the budget, which occur as actual expenses. The Maintenance Reserve, which was established to provide funding for non - scheduled capital asset repair and replacements and the Employee Liability fund. These activities require cash, checks and wire transfers on a regular basis and affect the District's cash flow. = L ANNUAL OPERATING W Summary The Water Enterprise is budgeted on an accrual basis and for FY 2014/15 reflects a loss of $2.9 million under the proposed budget, which includes a rate increase and variable water cost pass- through, and with depreciation of $5.9 million. This does not include CIP project expenditures, which are funded separately with capital reserves and other identified funds. On a cash basis, this budget will provide approximately $1.6 million at the end of the fiscal year. The Sewer Enterprise is also budgeted on an accrual basis and for FY 2014/15 reflects a loss of $802,000, with depreciation of $1.3 million. This also does not include CIP project expenditures, which will require funding from capital reserve funds and operating fund transfers. On a cash basis, this budget will provide $543,000 at the end of the fiscal year. A comprehensive Asset Management Plan (AMP) was completed in FY 2009/10 to establish long -term needs and objectives for funding asset replacements. This study allows the Board of Directors and staff to engage more fully in funding needs, assess options for future asset replacements and establish recommendations for a component of the water rate that may partially or completely fund reserves and thereby establish financial security for the future. In FY 2011/12, the District completed a Financial Planning Model that incorporates the District's annual operating expenses, with its debt service obligations and recommendations of the AMP, along with inputs for additional Capital Projects identified by staff. This planning tool allows the District to forecast financial needs into the future and determine appropriate revenue adjustments and sources needed to complete the District's service objectives. The current budget fully funds the AMP recommendations for the second year in a row. This is yet another positive step for ensuring the future fiscal stability of the District. The coming years will continue to pose challenges for those in California's water community. Despite the fact that 2013 was the driest year on record in much of California, federal court orders continue to curtail water deliveries from Northern California due to environmental factors in the Sacramento -San Joaquin Bay Delta. In addition, the political situation in the State Capitol has made it difficult to find the compromises necessary to address these environmental challenges that contribute to the higher cost of water statewide. Through foresight, investments into the local and regional water delivery system have allowed the Yorba Linda Water District to thus far avoid having to require mandatory water conservation. The District has instead achieved its water conservation goals using voluntary measures. However, given the ominous drought situation, we anticipate amplified conservation efforts by our customers as the record dry conditions continue and the increased cost of water places a greater burden on household budgets. With that in mind, our success as an organization is vastly enhanced by the practices and policies put in place by the Board of Directors to ensure the strength and stability of the District even as we move forward through uncertain times. We are fully confident that with these policies and practices, supported by dedicated and talented staff, we will achieve continued success as an organization and thus assure the well -being of the people we serve. In conclusion, this budget reflects the vision of the Board of Directors of the Yorba Linda Water District, its management, and its employees. We will continue to strive to make improvements in our budget processes, including an extensive review and analysis of projections for revenues, expenditures, capital projects, and reserves. I would like to thank all the staff involved in this process for the efforts put forth in the preparation of this budget to ensure a successful outcome. To the Board of Directors, we acknowledge and appreciate their continued support and direction in achieving excellence in financial management. Respectfully Submitted, Steve Conklin Acting General Manager VLM ANNUAL OPERATING BUDGET FISCAL' Budget Overview 4.4 Resolution to Adopt Budget RESOLUTION OF THE BOARD OF DIRECTORS OF THE YORBA LINDA WATER DISTRICT ADOPTING THE BUDGET FOR FISCAL YEAR 2014/15 AND RESCINDING RESOLUTION NO. 13 -10 WHEREAS, the Yorba Linda Water District has prepared a one year budget for Fiscal Year 2014/15; and WHEREAS, on May 22, 2014, the proposed "Draft" Budget for Fiscal Year 2014/15 was presented and reviewed at a regular meeting of the Board of Directors of the District; and WHEREAS, the "Final" Budget for Fiscal Year 2014/15 was presented and considered by the Board of Directors at a regular meeting on June 12, 2014; and WHEREAS, it is the desire of the Board of Directors to adopt the Budget for Fiscal Year 2014/15, and rescind Resolution No. 13 -10. NOW THEREFORE BE IT RESOLVED by the Board of Directors of the Yorba Linda Water District as follows: Section 1. That the Budget for Fiscal Year 2014/15, set forth in Exhibit "A" attached hereto, is hereby approved and adopted. Section 2. The Budget for Fiscal Year 2014/15 is in full force and effect beginning July 1, 2014, and continuing until this Resolution is rescinded by the Board of Directors. Section 3. That Resolution No. 13 -10 is hereby rescinded effective July 1, 2014. PASSED AND ADOPTED this 12th day of June 2014, by the following called vote: Robert Kiley, President Yorba Linda Water District 4 GFOA Distinguished Budget Award FY 2013/14 1� Mission & Vision Statement Our Mission "Yorba Linda Water District will provide reliable, high quality water and sewer services in an environmentally responsible manner, while maintaining an economical cost and unparalleled customer service to our community. " Our Vision "Yorba Linda Water District will become the leading, innovative and efficient source for high quality reliable services. " r' Core Values Statement r,\ The Yorba Linda Water District Board of Directors and staff are guided in everything we do by the following core values: Integrity— We demonstrate integrity every day by practicing the highest ethical standards and by ensuring that our actions follow our words. Accountability— We acknowledge that both the Board and the staff of the District are accountable to the public that we serve, as well as to each other. Responsibility— We take full responsibility for our actions- both our successes and our opportunities for growth. We maintain a commitment of courtesy, assessment and resolution with all customer concerns. Transparency — We promote a culture where we actively listen to our customers and communicate openly about our policies, processes and plans for the future. Teamwork — Success centers on all departments working together and sharing information and resources to achieve common goals. We are dedicated to ensuring that every voice of the District, from the Board to each individual employee is treated with dignity and respect, and that differences are valued and individual abilities and contributions are recognized. Strategic Goals Statement The Government Finance Officers Association (GFOA) recommends that all governmental entities use some form of strategic planning to provide a long -term perspective for service delivery and budgeting, thus establishing logical links between authorized spending and broad organizational goals. The goals, objectives and action steps within the District's Strategic Plan were determined by the mission and vision statements and core values of the District and further established through the process initiated by the Board of Directors through a Strategic Plan Workshop. Stakeholders that participated in this process included all five Board Members, the Executive Management team and members of the Employee Productivity- Innovation - Communications (EPIC) Committee, made up of staff representatives with varied levels of experience and expertise from across all District departments. In the District's strategic planning, goals are defined as identified challenges the District would like to address. Initiatives are defined as high -level concepts or plans for resolving the identified goals. Strategies are defined as action steps to achieving the identified initiatives, which, in turn, achieve the identified goals. Five goals were identified as the most critical challenges for the District to address in the next year: Goal CP: Community Partnership As a public agency, the District is expected to demonstrate the prudent use of public funds. The District's services should provide tangible benefits that are of value to the community. Strengthening existing relationships with key stakeholders, including customers and agency partners, while demonstrating our dedication to transparency in the most professional manner, is paramount. Initiatives Strategies Brand Recognition within the C Enhance Resources for Public Information & Governmental Affairs Division .a Develop a Public Relations Master Plan with Measurable Goals Have Board of Directors and YLWD Staff Attend More Events and Inter - governmental Meetings within the Local Community Continue to Support Regional Training and Multi- Agency Workgroups through the Joint Use of the Administration Building Effectively Use Broad Spectrum Communication Opportunities W VLM ANNUAL OPERATING BUDGET FISCAL' Provide Financial Incentives and Rebates for Water Use Efficiency Develop and Expand a Youth Education Program Consider Participation in the California Urban Water Conservation Council's Best Management Practices .a I Enhance the District's Regional Water and Wastewater Industry Participation Maintain a Commitment to Updating the District's Rules and Regulations Pertaining to Water, Sewer & Special District Best Practices Goal FR: Fiscal Responsibility The District is ranked highly by financial ratings organizations, has proven to be a good financial steward, and consistently strives for a clear, well- documented budget process and clean annual financial audit. However, with the state and national economic crisis, the District has an even greater responsibility to demonstrate effective and responsible use of public funds while responding to ever - increasing financial challenges. Initiatives Strategies Develop a Comprehensive Multi -Year Financial Plan Prepare a High Level Annual Budget Document and Comprehensive Annual Financial Report and Compete for Recognition by the Government Finance Officers Association Revise the Water and Sewer Rules and Regulations and Evaluate " Fee Schedules Regularly for Proper Cost of Service Coverage Evaluate and Revise the Sewer Fund Allocation Maintain Commitment to a Strong Debt Services Ratio Continue to Record and Report the Fairly Stated Financial Activities of the District in a Timely and Transparent Manner to the Board of Directors and Member Agencies Increase • • Review the Reserve Policy and Funding Levels Annually Analyze the Asset Management Plan to Determine Future Asset Replacement Needs Implement an Approach to Ensure Reserves are Responsibly } Funded FR 3: Identify and Develop Additional Revenue Options Research and Obtain Grant Funding Whenever Feasible Review Opportunities to Earn "Cash- Back" on Operating Expenses through Commercial Credit Card Accounts Manage Cash Flow to Maximize Investment Income FR 4: Provide an Equitable Rate Structure =1 Complete the Cost of Service and Water Rate Study _ Evaluate Equitable Rate Structures that Promote Conservation and Efficiency Goal OE: Operational Efficiency The District has provided independent, trusted and reliable service for more than one hundred years, yet it recognizes the importance of continual improvements to increase operational efficiency. Initiatives Strategies • Identify the Current Functionality of Existing Technology and Determine if it is Being Utilized to Full Capacity • Evaluate How Each Department Might Make Further Use of Existing Technology • Provide Support and Encourage Employee Training Improve connectivity for Computerized Maintenance and • Management System (CMMS) • Improve Internet and Intranet Access Availability by Increasing } Bandwidth • Integrate GIS with Hydraulic Model, CMMS, Valve Exercise, and Hydrant Flushing Improve Radio Communications • ) Adopt GIS Data Maintenance and Request Procedures • Implement Field GIS software (Underground Service Alert, As -built Lining and Red - lining) • Convert Transferred Sewer Lines into GIS .e • Install a Reliable Backup Power System at Remote Control Sites Initiate a Comprehensive Backup • Work Toward Implementation of a District -Wide Paperless } Processing System VLW ANNUAL OPERATING BUDGET FISCAL' • Identify Core Inefficiencies • Develop Measurable Productivity Goals • Engage Employees in Methods of Addressing Inefficiencies • Determine the Cost Benefit Ratio of a Peer Review Survey • Establish a Team to Determine the Focus of the Survey • Institute Guidelines for Areas to Be Addressed Goal SR: Service Reliability The ultimate purpose of District assets and infrastructure is to safely and reliably provide vital services to the public. Our goal is to maintain all assets for optimal continuity of District services. Effective management of assets involves monitoring asset conditions against the level of service to manage risk of failure, planning for future financial needs and anticipating uncertainties or changing levels of service. Initiatives Strategies SR 1: Work Toward Service Reliability and Efficiency Continue with Efforts to Annex District Service Area to Orange County Water District Forecast Service Demand Projections Engage with Regional Agencies on Water Supply Issues Strengthen Existing Emergency Operations Partnerships Develop 1 Additional Well Site j=j Evaluate Alternative Water Sources SR 2: Explore Service Boundary Opportunities Evaluate Feasibility of Providing Additional Water Services within the Region Evaluate Feasibility of Providing Additional Wastewater Services within the Region Evaluate Feasibility of Providing Other Professional Services within the Region Complete Implementation of Five Year Capital Improvement Plan from FY 2011 -2015 with adopted amendments Continue Planning for Long Term Capital Improvements and Replacements into the future Goal WE: Workforce Engagement The District is known for its highly skilled staff and quality work. In order to retain a highly productive and proficient workforce, maintaining and building on employee engagement in the District will be critical to future success. With uncertain economic times to continue in the near term, however, greater calls for efficiency and responsiveness will require staff to be flexible and prepared to demonstrate effectiveness and accountability. Initiatives VLM ANNUAL OPERATING BUDGET FISCAL' Strategies ce WE 1: Retain a Highly Skilled and Capable Workfor _; _;] J mi Maintain Competitive Compensation via Classification and Compensation Surveys Explore Alternative Benefits Establish Career Development Expectations of Existing Employees Develop Methodologies to Assist Employees in Attaining Career Expectations Continue to Support Additional Training for Staff Encourage Staff Participation in Professional Organizations and Local Civic Groups Execute Timely and Consistent Employee Performance Evaluations J �j Identify Key Roles for Succession Define the Competencies and Motivational Profile Required for Key Roles Identify Individuals with the Potential to Perform Highly in Key Roles Develop Methodologies to Assist Employees in Preparing for Advancement I Implement a Program to Recognize Employees for Excellence Conduct Bi- Yearly All Hands Meetings Encourage Employee Training in Leadership and Technology Profile of the District Independent, Trusted and Reliable Service for more than 100 Years The Yorba Linda Water District is an independent special district, which operates under the authority of Division 12 of the California Water Code. The Yorba Linda Water District has been providing water and sewer services to the residents of the City of Yorba Linda, portions of Placentia, Brea, Anaheim, and nearby unincorporated areas since 1959, the year it was formed to take over the assets and water service responsibilities of the Yorba Linda Water Company, a mutual company formed in 1909. The District is governed by a five - member Board of Directors, elected at large from within the District's service area. The General Manager administers the day -to -day operations of the District in accordance with policies and procedures established by the Board of Directors. The Yorba Linda Water District employs a full -time staff of 77 employees and one part -time staff person. The District's Board of Directors meets on the second and fourth Thursday of each month. Meetings are publicly noticed and citizens are encouraged to attend. The District provides water, sewer or a combination of both services to residents and businesses within its service area, which includes approximately 14,475 acres of land comprising 22.6 square miles. The District serves a population of approximately 70,000 and currently provides water service through approximately 24,535 residential, commercial, and light industrial connections. District Services Residential customers make up approximately 92% of the District's customer base and consume approximately 72% of the water provided annually by the District. The District's drinking water comes from two sources: local groundwater and "imported water ". Approximately 50% comes from local groundwater and 50% comes from "imported water" from the Colorado River via the Colorado River Aqueduct and from Northern California via the State Water Project. The blending of these sources varies according to your geographic location within the District. YLWD currently operates 10 wells within our service area that pump water from the Orange County Groundwater Basin. The groundwater basin is managed by the Orange County Water District (OCWD), who allows more than 20 cities and water agencies, including YLWD, to withdraw water from the basin, via wells, at a cost of approximately $294 per acre -foot. OCWD sets a maximum percentage of water that can be pumped from the ground, the Basin Production Percentage (BPP). The remainder of YLWD's drinking water is "imported" water, purchased through the Municipal Water District of Orange County (MWDOC). MWDOC, in turn, purchases water from the State Water Project and the Colorado River Aqueduct, as part of a consortium of 26 agencies, through the Metropolitan Water District of Southern California (MWD). The cost of imported water to the retail agencies, such as YLWD, is almost four times the cost of pumping out of the groundwater basin. Imported water is treated at MWD's Diemer Filtration Plant, located on Valley View and Diemer Road in Yorba Linda. The majority of YLWD's operating expenses are variable water costs, which include purchasing water from both OCWD and MWDOC, as well as electrical and natural gas costs to pump water up to the highest elevations. The District has a unique water delivery system to provide service to homes ranging from 250 to 1,390 feet above sea level, from the Chino Hills to the Santa Ana River. The District maintains ten primary hydraulic "pressure zones" and fourteen water storage reservoirs. Almost ten years ago the District began a $95 million dollar "fast track" capital improvement program aimed at an infrastructural overhaul to ensure water reliability for our customers, and to meet current and anticipated consumption and financial demands. The program includes the construction of water wells, reservoirs, pipelines and booster pumping stations as well as various other system improvements. These systems improvements will allow greater access to groundwater throughout our service area and have the potential to reduce variable costs approximately $1 million per year. In addition, the ability to access groundwater provided by these upgrades serves to better prepare the District in the event of scheduled and unscheduled MWD shutdowns. Historically, YLWD rates have been among the lowest in Orange County, and continue to be so for the upcoming year. In fiscal year 2011/12 and 2012/13, the District purchased 18,647.9 acre -feet and 21,788.7 acre -feet of water to provide to customers, respectively. Fiscal year 2013/14 is forecasted to provide 22,343 acre -feet. Board of Directors & Executive Staff Robert R. Kiley, President Ric Collett, Vice President Michael J. Beverage Director Phil Hawkins Director Steven R. Conklin Acting General Manager/ Engineering Manager Art Vega Acting IT Manager Gary T. Melton Director A6 John DeCriscio Operations Manager Gina Knight HR & Risk Manager Delia Lugo Finance Manager ®Yorba Linda Water District Lt Mattaaer FIR & RIN Manager S.C.A.DA. Info. Svstems ��, Administrator Administrator A�btgt Safety & Training Aneb�Sf Coordinator Instrumentatbn Into. Svstems Svstems Analyst/ Technician Technician 1 Programmer Board of Olrectors General sr. ACOMO M castor ter Svc. Meter Services sup"'11111017 Lead Accounting Customer Srv. Meter Reader Assistant 1/11 Rep. l /11 /111 1 /It 2 FTE 4 FTE 3 FTE Organization Chart FY 2014/15 Total: 77 FTE positions budgeted 1 part -time position (non- benefited) MIMIC Inr°rm riw officer Public Affairs Specialist Executive Becretary Records Management Specialist Sr. Project Water Quality Construction Manager Engineer Project Supervisor WO Technician 1 111 Sr. Construction Associate EoP. Technician Inspector Engineer II 1 FTE HR Technician 2 FTE Construction Inspector Operations Manager Sr. Fleet Office Operations/ Water Mamt. Water Mechanic Clerk Warehouse Assist. Superintendant Production Superintendant Mechanic Sr. Maintanance 11 /III Dist. Operator Facilities Sr. Plant 2 FTE 4 FTE Maintenance Operator Maintanance Dist. Maintanance Dist. Maintanance Plant Operator Operator 111 Operator II Worker 1 II 4 FTE 8 FTE 9 FTE 3 FTE Job Classification Management Part -Time Supervisory /Confidential Bargaining Unit Legend r•1 1,61 W N� rh O� 0 rt w = —Lo ANNUAL OPERATING W Personnel Trends by Position Proposed Position/Title 2010 -11 2011 -12 2012 -13 2013 -14 2014 -15 ADMINISTRATION Assistant General Manager 0.5 - - - - Executive Secretary 1 1 1 1 1 General Manager 1 1 1 1 1 Legislative Affairs Intern # 0.5 0.5 0.5 - - Management Analyst 1 1 1 1 1 Public Affairs Intern 0.5 0.5 0.5 0.5 - Public Information Assistant - - - - 0.5 Public Information Officer 1 1 1 1 1 Records Management Clerk # - - - 0.5 - Records Management Specialist # - - - - 1 Total Administration 5.5 5 5 5 5.5 ENGINEERING Associate Engineer - - - - 1 Contruction Inspector 1 1 1 1 1 Contruction Project Supervisor - - - 1 1 Engineering Manager 1 1 1 1 1 Engineering Secretary 1 1 1 1 - Engineering Technician II 3 2 2 2 2 Project Coordinator - - - 1 - Project Engineer 2 2 2 - - Senior Construction Inspector 1 1 1 1 1 Senior Project Manager 1 1 1 1 1 Water Quality Engineer 1 1 1 1 1 Water Quality Technician II 1 1 1 1 1 Total Engineering 12 11 11 11 10 Under filled with Water Quality Technician I prior to FY 2013/14 # Legislative Affairs Intern replaced with Records Management Specialist position Changes and Trends: The Assistant General Manager position has not been filled since FY 2011 -12 and the part -time Records Management Clerk position that replaced an unfilled Legislative Affairs Intern position was changed to a full -time position. The Engineering Secretary position was replaced with an Operations Clerk position. The Public Information Intern position has been replaced by a Public Information Assistant, both part -time positions. = -� ANNUAL OPERATING W i - Position/Title FINANCE Accounting Assistant I Accounting Assistant II Customer Service Rep I Customer Service Rep 11 Customer Service Rep III Customer Service Supervisor Finance Director Finance Manager Meter Reader I Meter Reader 11 Meter Services Lead Senior Accountant Storekeeper Total Finance HUMAN RESOURCES Human Resources Analyst Human Resources Clerk Human Resource & Risk Mananger Human Resource Technician Personnel Technician Safety & Training Coordinator Total Human Resources Proposed 2010 -11 2011 -12 2012 -13 2013 -14 2014 -15 1 1 1 1 1 1 1 1 1 1 1 1 1 1 - 1 1 1 1 2 2 2 2 2 2 1 1 1 1 1 2 2 2 2 1 2 2 2 2 2 1 1 1 1 1 1 1 1 1 1 15 14 14 14 13 1 1 1 1 1 - - - 0.5 - 1 1 1 1 1 - - - 1 1 1 1 1 - - - - 1 1 3 3 3 4.5 4.0 Changes and Trends: The Personnel Technician position had a title change to Human Resources Technician. The Finance Director position had a title change to Finance Manager. A Safety & Training Coordinator position was added for FY 2013 -14. The Human Resources Clerk position was eliminated as was one Meter Reader I position. = -LM ANNUAL OPERATING W OPERATIONS Chief Plant Operator Facilities Maintenance Maintenance Distribution Operator II Maintenance Distribution Operator III Maintenance Worker I Mechanic II Mechanic III Office Clerk Operations Assistant Operations/ Warehouse Assistant Operations Assistant/Storekeeper Operations Manager Plant Operator II Sr Maintenance Distribution Operator Senior Fleet Mechanic Senior Plant Operator Water Maintenance Superintendant Water Production Superintendant Total Operations DISTRICT TOTAL (FTE) 1 1 1 1 - Proposed Position/Title 2010 -11 2011 -12 2012 -13 2013 -14 2014 -15 INFORMATION TECHNOLOGY 8 8 4 4 4 GIS Administrator 1 1 1 1 - GIS Analyst - - - - 1 GIS Technician 0.5 0.5 0.5 0.5 - Information Systems Administrator 1 1 1 1 1 Information Systems Technician 1 1 1 1 1 1 Information Systems Technician 11 1 1 1 - - Instrumentation Technician 1 1 1 1 1 IT Director 0.5 - - - - IT Manager - 1 1 1 1 SCADA Administrator 1 1 1 1 1 System Analyst/ Programmer - - - 1 1 Total Information Technology 6 6.5 6.5 7.5 7.0 OPERATIONS Chief Plant Operator Facilities Maintenance Maintenance Distribution Operator II Maintenance Distribution Operator III Maintenance Worker I Mechanic II Mechanic III Office Clerk Operations Assistant Operations/ Warehouse Assistant Operations Assistant/Storekeeper Operations Manager Plant Operator II Sr Maintenance Distribution Operator Senior Fleet Mechanic Senior Plant Operator Water Maintenance Superintendant Water Production Superintendant Total Operations DISTRICT TOTAL (FTE) 1 1 1 1 - 1 1 1 1 1 7 8 8 8 8 4 4 4 4 4 8 9 9 9 9 1 1 1 1 1 1 1 1 1 1 - 1 1 1 1 1 3 3 3 3 3 4 4 4 4 4 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 35 37 37 37 38 76.5 76.5 76.5 79.0 77.5 Changes and Trends: One additional Maintenance Worker I position was added during FY 2011 -12 because of additional sewer lines transferred to YLWD from the City of Yorba Linda. The Office Clerk position replaced the Engineering Secretary position. Personnel Trends by Department ao 70 60 50 40 30 20 10 0 DISTRICT TOTALS 77.5 77.5 77.5 79 77.5 Zuiir11 2011 -12 2012 -13 201314 Proposed 201415 ■ Administration ■ Engineering ■ Finance ■ Human Resources ■ Information Technology ■ operations Proposed Department 2010 -11 2011 -12 2012 -13 2013 -14 2014 -15 Administration 5.5 5 5 5 5.5 Engineering 12 11 11 11 10 Finance 15 14 14 14 13 Human Resources 3 3 3 4.5 4 Information Technology 7 7.5 7.5 7.5 7 Operations 35 37 37 37 38 ao 70 60 50 40 30 20 10 0 DISTRICT TOTALS 77.5 77.5 77.5 79 77.5 Zuiir11 2011 -12 2012 -13 201314 Proposed 201415 ■ Administration ■ Engineering ■ Finance ■ Human Resources ■ Information Technology ■ operations Financial Policies & Goals This section includes a brief summary of the District's Operating Budget Policy, Revenue and Expenditure Policy, Reserve Policy, and Investment Policy. Though each financial policy is reviewed annually, only the District's Investment Policy is updated and adopted by the Board on an annual basis. The full Financial Policies can be found on page 195. Operating Budget Policy The District's budget is developed in accordance with the priorities which are linked to the District's financial and strategic plans set forth in the District's mission and long -term goals and objectives. These are found in the District's comprehensive master plans, the long term financial plan, the needs of the community, and federal and state laws. The District operating and capital budget is developed on an annual basis. Operating and capital appropriations are approved by the District's Board of Director's. A balanced budget is defined as the amount of budgeted expenditures is equal to or less than the amount of budgeted revenue, plus available fund balance. The accounting for the District is kept on an accrual basis. Revenues are recognized when earned, and expenses are recognized when incurred. The budgeting for District expenses, with the exception of supplies and services, is on an accrual basis. Supplies and services are budgeted on a cash basis. The District is operated as an enterprise fund, an accounting entity which finances and accounts for the acquisition, operation, and maintenance of governmental facilities and services. It is the intention of the District to recover the full costs of providing maintenance, goods, and /or services through the collection of user charges. Revenue and Expenditure Policy Budgeted revenues are estimated conservatively using an objective and analytical approach using historical trends and current information to maintain consistency, reliability, and reasonableness. The District's expenditures reflect the Board of Directors' and staff commitment to serve present and future customers with reliable public services. The Board and staff believe that prudent expenditure planning and accountability will ensure fiscal stability. = L ANNUAL OPERATING W Budgeted expenditures are projected conservatively using an objective and analytical approach as well as certain techniques such as historical trends, current information, and economic indicators to maintain consistency, reliability, and reasonableness. Reserve Policy This policy represents the public affirmation of the Board's commitment to the financial prudence and careful stewardship of community assets. This policy covers: Operating Reserve (target level of 8 % -17% of annual operating budget); Emergency Reserve (target level between $1 and $4 million for water fund and $250,000 and $1 million for sewer fund); Capital Replacement Reserve (target level of $1.82 million for water fund less money set aside for Maintenance Reserve and $345,000 for sewer fund); Maintenance Reserve (target level of $200,000); Debt Service Reserve (target level of highest annual debt service payment); Employee Liabilities Reserve (annual contribution of $100,000) and US Bank 2008 COP Reserve (target level of $2,147,096). These funds are designated by the District's Board to carry out specific purposes to ensure prudent management of District's financial resources and are used by District's staff as parameters within which the Board expects staff to operate. The Financial Reserve Policy has three primary goals: • To preserve the financial stability of the District against present and future uncertainties in an ever - changing environment • To maintain the District's bond ratings in the capital markets and sustaining debt covenant compliance • To provide adequate funding to meet the District's short -term and long -term plans and commitments to its customers All reserve balances will be subject to review by the Board of Directors on an annual basis as part of the budget process. Investment Policy It is the policy of the District to invest funds in a manner that will provide the highest investment return with the maximum security while meeting the daily cash flow demands of the District and conforming to all statutes governing the investment of the District funds. The policy follows the "prudent investor" standard of the California Government Code Section 53600.3 and is updated and formally adopted by the District on an annual basis. = I V W ANNUAL OPERATING Basis of Budgeting & Accounting The accounting for the District is kept on an accrual basis. Revenues are recognized when earned, and expenses are recognized when incurred. The budgeting for District expenses, with the exception of supplies and services, is on the accrual basis. Supplies and services are budgeted on the cash basis of accounting. The District is operated as an enterprise fund, which is an accounting entity that finances and accounts for the acquisition, operation and maintenance of governmental facilities and services. It is the District's intention to recover the majority of the costs of the acquisition, operation, and maintenance of governmental facilities through user - charges and the receipt of property taxes. Budget Controls When the Fiscal Year 2014 -15 Operating and Capital Budget is approved by the Board, budgeted amounts are appropriated and expended within each department. Subject to the approval of the annual budget by the Board of Directors, the General Manager has full charge and control of the District's expenditures to ensure that operating and capital expenditures in each fiscal year are within the budgetary guidelines and to ensure that the District's goals and objectives are met. Developing and monitoring the budget is an ongoing process. Monthly reports of expenses and revenues compared to the budget are developed to provide a method for ongoing review at the department level and are presented to the Finance Accounting Committee. The Board reviews quarterly financial status reports. Throughout the year, Finance and other department managers will review actual results of operating expenditures as compared to the budgeted amounts approved by the Board of Directors in June 2014. The General Manager has the authority to make administrative adjustments to the budget as long as those changes will not have a significant policy impact nor affect the budgeted year -end fund balances. Any significant program changes or service level changes require approval by the Board of Directors. All budget transfers are documented and tracked within the Finance Department. = L ANNUAL OPERATING W Review and adjustments to the capital budget appropriations are also recommended throughout the fiscal year. Project managers may find that some projects contemplated at the beginning of the fiscal year have been delayed or accelerated due to changes in conditions, weather and /or economics, and new projects may be added to meet future demands, goals and objectives. Any recommended changes to the Capital Improvement Budget would be brought to the Board of Directors for approval. Resolutions adopted by the Board of Directors are required for authorizing positions in the service of the District and for setting salary ranges for those authorized positions. The General Manager is authorized to use savings from vacant authorized positions to retain contract labor to meet District personnel needs. The General Manager is also authorized to fill an approved and budgeted position that is vacated during the term of the budget year with a new employee at an equal or lower classification. The budget may need to be modified to reflect labor and benefit agreements. These changes would be approved by the Board of Directors. As defined by the District's Purchasing Policy, in the event that the General Manager determines that an emergency exists and requires immediate action, the General Manager shall have the power, without prior Board action, to enter into contracts and agreements and expend funds on behalf of the District beyond the final approved fiscal year budget in an amount not to exceed $100,000. Those amounts shall be ratified at the next meeting or at the earliest special meeting that can be called. Amounts in excess of $100,000 require Board of Director approval and shall be formally ratified at the next meeting or at the earliest special meeting that can be called. Budget Process The budget process begins in January of each year and is the product of a comprehensive team effort from various levels within the organization, as shown on the following Budget Calendar. Each year, the Finance Department prepares expenditure budget worksheets for distribution to key staff. These worksheets give staff the necessary information to project their department's budgets by category. Included in the worksheets are the past year's actual expenses, current year transactions, and projected current year end balances. Based on the information provided, and accounting for any changes for anticipated purchases, the requested amounts from the worksheet are entered into the budget system and compared to last year's budget. Any substantial budget change needs to be justified by the respective departments. The Human Resources Department reviews the employee positions and wages of the District. The Human Resources Department makes a recommendation to the General Manager if new positions need to be added, changes in job descriptions need to occur, or reclassifications of position are required. The results of this review are presented to the Personnel -Risk Management Committee for further input and approval. The approved personnel recommendations are entered into the budget system for inclusion in the budget document. The Engineering Department prepares a list of CIP projects to be presented to the Planning- Engineering- Operations Committee. Based on recommendations from staff, each CIP project will be prioritized based on necessity. The Engineering Department will also update the future project list and will incorporate cost changes due to construction cost increases or a change in the scope of the project. The method to determine the revenue projections takes into account factors such as projected growth, required conservation, historical activity, and the current economic conditions. Once all the components have been calculated, each department presents their departmental budget to their appropriate committee for review. Comments and changes that are recommended by staff and committees are included in a draft document that is then presented to the Board of Directors in a public forum for review and comment. Once all approved changes have been incorporated into the draft document, a final budget is then presented to the Board of Directors for adoption. Developing and monitoring the budget is an ongoing process. Monthly reports of expenses and revenues compared to the budget are developed to provide a method for ongoing review at the department level and are presented to the Finance Accounting Committee. The Board reviews quarterly financial status reports. = � ANNUAL OPERATING W DATE BOARD /COMMITTEE JANUARY January 21, 2014 Manager's Meeting January 28, 2014 Finance - Accounting Committee FEBRUARY Budget Calendar SCHEDULE Discuss Budget Calendar and Process Personnel & Capital budget discussion Review the Budget Calendar February 4, 2014 Manager's Meeting Personnel & Capital budget discussion Revenues Discussion Mid -Year Budget -to- Actuals Distribution February 4, 2014 Planning- Engineering- Operations Committee Capital Improvement Projects budget (v 0.5) February 10, 2014 Exec - Admin- Organizational Committee Board of Directors and Administration budget (v 1.0) February 24, 2014 Finance - Accounting Committee Finance budget (v 1.0), Operating revenues (v 1.0) Reserve policy analysis (v 1.0) MARCH March 3, 2014 Public Affairs- Communications -Tech Commits IT & Public Affairs budget (v 1.0) March 6, 2014 Planning- Engineering- Operations Committee Engineering and Operations budget (v 1.0) Capital Improvement Projects budget (v 1.0) (w/3 -5 Year Cash Flow) *` Complete Salaries & Benefits in Conjuction with Cash Flow March 10, 2014 Exec- Admin- Organizational Committee Board of Directors and Administration budget (v 2.0) March 11, 2014 Personnel -Risk Mgmt Committee Labor and benefits (v 1.0), HR budget (v 1.0) March 17, 2014 Finance - Accounting Committee Finance budget (v 2.0), Reserve policy analysis (v 2.0) March 17, 2014 Board Workshop #1 Draft Capital Improvement Projects budget 3:00 PM Draft Engineering and Operations budget Draft Authorized Positions and Labor /Benefits budget APRIL April 7, 2014 Public Affairs- Communications -Tech Commits IT & Public Affairs budget (v 2.0) April 8, 2014 Personnel -Risk Mgmt Committee HR budget (v 2.0), Labor and Benefits (v 2.0) April 21, 2014 Board Workshop #2 Draft Board of Directors and Administration budget 3:00 PM Draft IT & Public Affairs budget Draft Finance budget Draft HR budget MAY May 22, 2014 Board of Directors Draft Budget (Full Board) May 20, 2014 Finance - Accounting Committee Draft reserve policy JUNE June 12, 2014 Board of Directors Final Budget (Full Board) Reserve policy adoption JULY July 1, 2014 Email adopted budget to Wells Fargo Bank contact - for compliance = —LM ANNUAL OPERATING W Revenue Assumptions The main source of Operating Revenue for the District is water and sewer rate revenue. However, rate revenue is not enough to fund the total cost of operations and must be supplemented by a variety of miscellaneous /other operating revenues. Other operating revenues include items such as customer service fees, unmetered jumpers, and other sources. Total operating revenues are projected to increase at a rate of 4% in FY 2014/2015. Water operating revenues are estimated to increase by 4% to $29,169,647 in FY 2014/15. Sewer operating revenues are estimated to increase by 4% to $1,856,066 in FY 2014/15. Water Operating Fund Potable Water sales are the largest source of District revenues, with the majority of sales to residential customers. In previous years, mild weather conditions, less that desirable economic conditions, and a strong water conservation message have resulted in lower consumption demand and thus lower than anticipated water revenues. The current year, however, is the driest year on record for much of California and despite continued strong conservation messages, consumption and water revenues will greatly exceed budgeted numbers. It is projected that the coming year will continue along the same extremely dry trend and water use levels will remain consistently high as homeowners attempt to maintain green lawns and full swimming pools. Because of the California State Governor's official Declaration of Drought, earlier in the current fiscal year, the District is budgeting for a voluntary 5% conservation reduction of current forecasted usage. There is no tiered water rate structure at YLWD. Therefore, Water Revenues are calculated using the average number of units consumed per customer account, a proposed monthly fixed charge per account, and a proposed $2.70 per billing unit consumed (which is 100 cubic feet (ccf) or approximately 750 gallons). The result is then annualized for the budget projection. The budget assumes a yearly demand of 21,980 acre feet (AF) in FY 2014/15. The chart below displays the historical trend of water revenue. Revenue from Service Charges is a calculation of the projected number of service connections for FY 2014/15 (24,535) multiplied by the proposed fixed service charge based on meter size. The following chart displays this information. Water Rate -AWKWe Effective Date FY 12/13 7/1/2012 I FY 13/14 7/1/2013 FY 14/15 7/1/2014 Monthly Service Charges (per month) 5/8 $7.56 $8.80 $10.06 3/4 $7.56 $8.80 $10.06 1 $12.60 $14.67 $16.77 1 1/2 $25.20 $29.34 $33.54 2 $40.32 $46.94 $53.66 3 $88.20 $102.67 $117.37 4 $158.76 $187.80 $211.26 6 $352.80 $410.67 $469.47 Water Usage Charge (based on actual pass- through water supply charges) $2.57 /hcf $2.64 /hcf $2.70 /hcf Other Income Revenues, which include but are not limited to backflow charges, unmetered jumpers, construction meters, new account fees, and other income, are projected based upon historical activity and current economic conditions. Interest Income for the water operating funds is projected based on an average yield of 0.5% on the District's portfolio. Property Tax Income is projected based on the assumptions of the Orange County Tax Assessor. The District anticipates receiving 97% of its share of the ad valorem tax revenue, which will result in a 1 % increase when compared to the previous year. Other Non - Operating Revenue, which include but are not limited to annexation fees, rental income, and other sources, are projected based upon historical activity and current economic conditions. $3,500,000 Other Water Revenue $3,000,000 538,468 $687,391 $2,500,000 $574,424 $501,200 $2,000,000 0 $1,273' 7$1,350,0 $1,500,000 $1,340,916 $1,264,672 $1,283,642 $1,000,000 0 $102,000 $121,210 $75,000 $100,0001 $500,000 $865,113 J $681,07 $670,003 $0 FY 2011/12 Actual FY 2012/13 Actual FY 2013/14 Budget FY 2013/14 Forecast FY 2014/15 Budget ■ Other Operating Revenue ■ Interest Income ■ Property Taxes ■ Other Non - Operating Sewer Operating Fund The District's Sewer Revenues are based on the sewer collection services provided to our customers. Sewer maintenance charges will remain fixed at $5.50 per month for single family residential customers with associated charges for multi - family and commercial accounts. The District will provide sewage collection services for approximately 25,300 sewer service connections. VLM ANNUAL OPERATING BUDGET FISCAL' $2'500•000 Sewer Charge Revenue $2,171,058 $2,000,000 $1,831,489 $1,807,952 $1,892,400 $1,891,916 $1,500,000 $1.000,000 $500,000 $0 FY 2011 /12 Actual FY 2012 /13 Actual FY 2013/14 Budget FY 2013 /14 Forecast FY 2014/15 Budget Other Income Revenues, which include but are not limited to sewer collection fees and miscellaneous income, are projected based upon the historical activity and current economic conditions. Interest Income for the sewer operating funds is projected based on an average yield of 0.5% on the District's portfolio. $+$0000 Other Sewer Charge Revenue $400,000 $267,186 $351,000 $300Ao0 $251,010 $200000 $150,000 - 537,500 $100,000 $23,659 $23,925 $14,430 $8,300 $7,950 $50•oDo $94,408 $16,359 8 $0 - -� -10 EVA FY 2011 /12 Actual FY 2012 /13 Actual FY 2013/14 Budget FY 2013 /14 Forecast FY 2014/15 Budget ■ Other Operating revenue ■ Interest Income ■ Other Income r Lo 17M ` ANNUAL OPERATING Cost Allocation The allocation of costs are derived from cost accounting. Cost accounting is defined as the process of tracking, recording and analyzing costs associated with the products or activities of an organization. The costs of operating expenses including employee wages and benefits are allocated to each department and division, based on actual expenses as tracked by the District's accounting system. The District's budget is presented with an allocation of 93% to the Water Fund and 7% to the Sewer Fund, with the exceptions of the Water Production, Water Operations, and Mechanical Services sections which are allocated 100% to the Water Fund. Additionally, the Sewer Operations section, which includes sewer - related expenses including vehicle maintenance, is allocated 100% to the Sewer Fund. The methodology used to determine the allocation percentages involved discussions with personnel from each department where they were to identify a basis for each section by which an allocation percentage could be used. This analysis concluded that the allocation percentage described above was appropriate. Costs associated with capital projects are tracked by the means of assigned "Job Numbers ". Salaries affiliated with capital projects are allocated to the appropriate CIP accounts based on actual timesheet entries. An overhead of approximately 33% is applied to the allocated salary costs by job number in order to provide a true salary and benefit cost applicable to CIP projects. Chart of Major Funds Structure (FY 14/15) Water Sales Service Charges Property Tax Interest Income Other Income Sewer Service Charges Water Fund Sewer I Fund District Operations & Maintenance Activities = -Lo ANNUAL OPERATING W Rate History * Based on a 1 inch meter Monthly Commodity Minimum Allowance Charge Monthly Year (CCF) (CCF) Charge 1960 20 $0.06 $3.50 1961 20 $0.06 $3.50 1962 20 $0.06 $3.50 1963 20 $0.06 $3.50 1964 10 $0.10 $3.50 1965 10 $0.10 $3.50 1966 10 $0.10 $3.50 1967 10 $0.10 $3.50 1968 8 $0.12 $3.50 1969 6 $0.14 $3.50 1970 6 $0.16 $3.50 1971 6 $0.16 $3.50 1972 6 $0.16 $3.50 1973 6 $0.18 $3.50 1974 6 $0.20 $3.50 1975 6 $0.20 $3.50 1976 6 $0.24 $3.50 1977 6 $0.24 $3.50 1978 6 $0.27 $3.50 1979 6 $0.27 $3.50 1980 6 $0.30 $3.50 1981 6 $0.30 $3.50 1982 6 $0.30 $3.50 1983 6 $0.30 $3.50 1984 6 $0.39 $3.50 1985 5 $0.45 $4.00 1986 5 $0.57 $5.85 * Based on a 1 inch meter Monthly Commodity Minimum Allowance Charge Monthly Year (CCF) (CCF) Charge 1987 5 $0.59 $5.95 1988 5 $0.59 $5.95 1989 5 $0.59 $5.95 1990 5 $0.61 $6.15 1991 5 $0.66 $6.65 1992 5 $0.76 $7.65 1993 0 $0.92 $4.65 1994 0 $0.98 $4.65 1995 0 $0.98 $4.95 1996 0 $0.98 $4.95 1997 0 $0.98 $4.95 1998 0 $0.98 $4.95 1999 0 $0.98 $4.95 2000 0 $1.03 $5.20 2001 0 $1.03 $5.20 2002 0 $1.13 $5.70 2003 0 $1.33 $5.70 2004 0 $1.33 $6.70 2005 0 $1.57 $7.92 2006 0 $1.57 $7.92 2007 0 $1.57 $7.92 2008 0 $1.79 $8.35 2009 0 $2.52 $10.20 2010 0 $2.52 $11.73 2011 0 $2.52 $11.73 2012 0 $2.57 $12.60* 2013 0 $2.64 $14.67* 2014 0 $2.70 $16.77* Average Residential Monthly Bill by Year $90.00 Water Sewer Service Service Consumption $70.00 Charge FY 05/06 $35.01 $3.50 $7.92 FY 06/07 $35.01 $5.50 $8.35 FY 07/08 $39.92 $5.50 $8.35 FY 08/09 $39.92 $5.50 $8.35 FY 09/10 $56.20 $5.50 $10.20 FY 10/11 $56.20 $5.50 $11.73 FY 11/12 $56.20 $5.50 $11.73 FY 12/13 $57.31 $5.50 $12.60 FY 13/14 $58.87 $5.50 $14.67 FY 14/15 $60.21 $5.50 $16.77 $90.00 $80.00 $70.00 $14.67 $12.60 $10.20 $11.73 $11.73 $60.00 $50.00 $8.35 $8.35 $8.35 $7.92 $40.00 $7.92 $30.00 $20.00 $10.00 FY 04/05 FY 05/06 FY 06/07 FY 07/08 FY 08/09 FY 09/10 FY 10/11 FY 11 /12 FY 12/13 FY 13/14 FY 14/15 $44.42 $46.43 $48.86 $53.77 $53.77 $71.90 $73.43 $73.43 $75.41 $79.04 $82.48 ■ Water Consumption ■ Sewer Service Service Charge Note: Using 22.3 ccf per billing period (1 ccf = 748 gallons) with a 1 inch meter Prior to April 2009, bills were submitted bi- monthly. This graph averages out the charges to a hypothetical monthly bill. Demographics Yorba Linda Water District encompasses an area of approximately 22 square miles of rural hills and valleys in northern Orange County, running north of the 91 freeway, from the western edge of Chino Hills State Park and incorporating nearly all of the City of Yorba Linda, in addition to portions of the Cities of Anaheim, Placentia and Brea. Aview of the District from atop Fairmont Reservoir The District's service area is distinguished for having larger than average residential lots with more than 100 miles of horse trails winding throughout the City. In a 2010 report, CNN ranked the City of Yorba Linda as 38th among the best places in the United States to live. Similarly, in an article by CNN Money, the City of Yorba Linda was listed as one of the most affluent cities in the United States, as well as the highest median income in Orange County, as reported by 2010 Census data, based on towns between 65,000 and 250,000 in population. 4 The U.S. Census Bureau estimates the median household income for the City of Yorba Linda for the years 2007 -2011 is $115,291 and the median house value for the same time period is $724,600. $800,000 $700,000 $600,000 $500,000 $400,000 $300,000 $200,000 $100,000 City of Yorba Linda Median Comparisons City of Yorba Linda Orange County State of California ■ Median Family Income ■ Median Home Value The ethnic makeup of the City of Yorba Linda is 75% White, 14% Hispanic, 9% Asian, 1 % African - American and 1 % Other. The following chart visualizes these percentages. E 1 City of Yorba Linda Demographics 1 %\ 1% • White • Hispanic Asian • African - American • Other YLWD Service Area The District's service area overlaps multiple cities encompassing several County governed pockets. Projections from the Southern California Association of Governments estimate that the population within the District's service area will grow from approximately 70,000 to nearly 98,000 by the year 2035. I-Z_ �ANNUAL OPERATIN Ten Largest Customers Current and Three Years Ago FY 2013/14 Annual % of Actual Customer Name Business Type Revenues Revenues 1 Cityof Yorba Linda Government $ 1,860,227 6.35% 2 Placentia Yorba Linda USD Government $ 267,442 0.98% 3 Fairmont Hill Community Assoc. Homeowner's Assoc. $ 110,976 0.41% 4 Yorba Linda Villages Homeowner's Assoc. $ 108,023 0.40% 5 Archstone Yorba Linda Homeowner's Assoc. $ 99,849 0.37% 6 The Hills at Yorba Linda Homeowner's Assoc. $ 94,025 0.34% 7 Kerrigan Ranch II Community Assoc. Homeowner's Assoc. $ 53,825 0.20% 8 Lake Park Mobile Home Community Homeowner's Assoc. $ 59,401 0.22% 9 Rancho Dominguez Community Homeowner's Assoc. $ 59,149 0.22% 10 Mt. San Antonio Home Owners Assoc. Homeowner's Assoc. $ 55,728 0.20% $ 2,768,643 9.49% FY 2010/11 Annual % of Actual Customer Name Business Type Revenues Revenues 1 City of Yorba Linda Government $ 1,614,790 6.82% 2 Placentia Unified School Government $ 277,694 1.17% 3 Archstone Yorba Linda Homeowner's Assoc. $ 98,560 0.42% 4 Fairmont Hill Community Assoc. Homeowner's Assoc. $ 91,999 0.39% 5 Yorba Linda Villages Homeowner's Assoc. $ 82,166 0.35% 6 The Hills at Yorba Linda Homeowner's Assoc. $ 80,246 0.34% 7 Kerrigan Ranch II Community Assoc. Homeowner's Assoc. $ 63,948 0.27% 8 Lake Park Mobile Home Community Homeowner's Assoc. $ 59,555 0.25% 9 Woodgate Condominiums Homeowner's Assoc. $ 57,622 0.24% 10 Rancho Dominguez Community Assoc. Homeowner's Assoc. $ 50,645 0.21% $ 2,477,226 10.46% VLW ANNUAL OPERATING BUDGET FISCAL' FINANCIAL SUMMARIES VLM ANNUAL ©PERATING BUDGET FiSCaL Total Revenue and Expenses (Water & Sewer) Revenue (Operating): Water Revenue (Residential) Water Revenue (Commercial & Fire Det.) Water Revenue (Landscape /Irrigation) Service Charges Sewer Charge Revenue Sewer Parcel Assessments Other Operating Revenue Total Operating Revenue Revenue (Non- Operating): Interest Property Tax Other Non - Operating Revenue Total Non - Operating Revenue Total Revenue Expenses (Operating): Variable Costs Salary Related Expenses Reduction for Capital Project Labor Salary Related Expenses Total Supplies & Services: Communications Contractual Services Data Processing Dues & Memberships Fees & Permits Board Election Insurance Materials District Activities, Emp Recognition Maintenance Non - Capital Equipment Office Expense Professional Services Training Travel & Conferences Uncollectible Accounts Utilities Vehicle Expenses Supplies & Services Sub -Total Total Operating Expenses Expenses (Non- Operating): Interest Expense Other Expense Total Non - Operating Expenses Total Expenses Net Income Before Capital Contributions Capital Contributions FY 2011112 FY 2012113 FY 2013/14 FY 2013/14 FY 2014/15 Actual Actual Budget Forecast Budget $16,120,680 $16,596,680 $ 1,820,913 $ 1,890,269 $ 3,687,643 $ 4,161,528 $ 3,369,437 $ 3,721,462 $ 1,580,369 $ 1,561,850 $ 205,435 $ 200,189 $ 848,238 $ 723,577 $27,632,716 $28,855,555 $ 277,137 $ 137,569 $ 1,273,855 $ 1,340,916 $ 805,654 $ 588,854 $ 2,356,646 $ 2,067,339 $29,989,362 $30,922,894 $12,275,853 $13,509,336 $ 6,979,088 $ 7,225,729 $ 6,979,088 $ 7,225,729 $ 214,165 $ 199,150 $ 437,875 $ 476,369 $ 125,732 $ 133,426 $ 58,432 $ 57,402 $ 154,146 $ 188,354 $ 228,805 $ 257,274 $ 504,352 $ 752,538 $ 12,972 $ 21,423 $ 532,933 $ 457,663 $ 111,375 $ 182,845 $ 46,077 $ 42,343 $ 907,959 $ 906,818 $ 39,030 $ 25,106 $ 20,488 $ 25,461 $ 22,995 $ 36,383 $ 72,027 $ 92,333 $ 321,756 $ 367,510 $ 3,811,119 $ 4,222,398 $23,066,060 $24,957,463 $ 1,626,190 $ 1,781,416 $ 108,984 $ 228,364 $ 1,735,174 $ 2,009,780 $24,801,234 $26,967,243 $ 5,188,127 $ 3,955,651 $17,214,139 $ 1,174,673 $16,217,590 $17,661,221 $17,154,552 $ 2,020,223 $ 2,103,007 $ 2,074,097 $ 4,794,156 $ 4,738,935 $ 4,792,995 $ 4,468,716 $ 4,336,450 $ 4,478,000 $ 1,550,530 $ 1,556,764 $ 1,605,292 $ 200,797 $ 200,797 $ 201,000 $ 717,749 $ 954,156 $ 719,777 $29,969,760 $31,551,329 $31,025,713 $ 87,000 $ 110,300 $ 112,000 $ 1,264,672 $ 1,350,000 $ 1,283,642 $ 509,150 $ 724,891 $ 533,525 $ 1,860,822 $ 2,185,191 $ 1,929,167 $31,830,583 $33,736,520 $32,954,880 $13,767,658 $14,721,591 $14,928,972 $ 8,169,873 $ 7,841,377 $ 8,509,812 $ (265,000) $ (257,678) $ (285,000) $ 7,904,873 $ 7,583,700 $ 8,224,812 $ 305,200 $ 189,331 $ 542,840 $ 551,268 $ 170,730 $ 195,804 $ 72,335 $ 78,096 $ 167,365 $ 172,532 $ 299,240 $ 332,971 $ 587,775 $ 767,110 $ 25,150 $ 15,088 $ 479,150 $ 354,337 $ 137,950 $ 117,364 $ 46,150 $ 40,180 $ 785,210 $ 601,944 $ 71,160 $ 32,524 $ 52,450 $ 28,411 $ 25,000 $ 31,203 $ 90,800 $ 34,534 $ 367,149 $ 381,290 $ 4,225,654 $ 3,923,987 $25,898,185 $26,229,277 $ 1,815,317 $ 1,733,122 $ 76,400 $ 44,263 $ 1,891,717 $ 1,777,385 $27,789,902 $28,006,662 $ 4,040,680 $ 5,729,858 $ 350,819 $ 779,000 $ 294,894 $ 560,700 $ 186,830 $ 78,065 $ 186,190 $ 75,000 $ 313,340 $ 658,125 $ 24,710 $ 442,150 $ 152,000 $ 40,475 $ 711,610 $ 65,180 $ 46,500 $ 40,000 $ 90,800 $ 358,400 $ 4,324,969 $ 27,478,753 $ 1,780,793 $ 72,000 $ 1,852,793 $29,331,545 $ 3,623,335 Net Income Before Depreciation $17,402,266 $ 5,130,324 $ 4,391,499 $ 6,508,858 $ 3,623,335 Depreciation $ 6,291,786 $ 6,884,213 $ 6,897,941 $ 7,270,308 $ 7,337,500 Income (Loss) $11,110,480 $ (1,753,889) $ (2,506,442) $ (761,450) $ (3,714,165) 1� Total Revenue and Expenses (Water & Sewer), Continued $40,[00,00( $35,000,00( $30,000,00( $25,000,00( $20,000,00( $15,000,00( $10,000,00( $5,000,(10( Total Revenues & Expenses (Does not include depreciation expense) $32,954,880 FY 2011/12 Actual FY 2012/13 Actual FY 2013/14 Budget FY 2013/14 Forecast FY 2014/15 Budget FY 2013/14 Total Revenue Total Revenue —1 —Total Expenses ■ Water Revenue ■ Sewer Revenue • S,—e Charges • Interest • property Taa • Other Revenue Total: $32,954,860 FY 2013/14 Total Expenses • Depreciation • Variable W!L!! COSh • 5elaries &Sen.% ■ Supplies &Services • Lony Tenn Debt • Other Expense Total: $29,331,545 Total Revenue and Expenses (Water) FY 2011/12 FY 2012/13 FY 2013/14 FY 2013/14 FY 2014/15 Actual Actual Budget Forecast Budget Revenue (Operating): Water Revenue (Residential) $16,120,680 $ 16,596,680 $16,217,590 $ 17,661,221 $17,154,552 Water Revenue (Commercial & Fire Det.) $ 1,820,913 $ 1,890,269 $ 2,020,223 $ 2,103,007 $ 2,074,097 Water Revenue (Landscape /Irrigation) $ 3,687,643 $ 4,161,528 $ 4,794,156 $ 4,738,935 $ 4,792,995 Service Charges $ 3,369,437 $ 3,721,462 $ 4,468,716 $ 4,336,450 $ 4,478,000 Other Operating Revenue $ 753,830 $ 684,916 $ 681,074 $ 865,113 $ 670,003 Total Operating Revenue $25,752,503 $ 27,054,855 $28,181,759 $ 29,704,725 $29,169,647 Revenue (Non- Operating): Interest $ 253,478 $ 121,210 $ 75,000 $ 102,000 $ 100,000 Property Taxes $ 1,273,855 $ 1,340,916 $ 1,264,672 $ 1,350,000 $ 1,283,642 Other Non - Operating Revenue $ 538,468 $ 574,424 $ 501,200 $ 687,391 $ 521,600 Total Non - Operating Revenue $ 2,065,801 $ 2,036,550 $ 1,840,872 $ 2,139,391 $ 1,905,242 Total Revenue $27,818,304 $ 29,091,405 $30,022,631 $ 31,844,116 $31,074,889 Expenses (Operating): Variable Water Costs (G.W., Import & Power) $12,275,853 $ 13,509,336 $13,767,658 $ 14,721,591 $14,928,972 Salary Related Expenses $ 6,125,692 $ 6,390,207 $ 7,237,204 $ 6,904,763 $ 7,628,522 Reduction for Capital Project Labor $ - $ - $ (250,000) $ (250,000) $ (265,050) Salary Related Expenses Total $ 6,125,692 $ 6,390,207 $ 6,987,204 $ 6,654,763 $ 7,363,472 Supplies & Services Communications $ 199,032 $ 186,573 $ 283,371 $ 176,252 $ 273,786 Contractual Services $ 407,877 $ 442,969 $ 504,089 $ 512,101.60 $ 521,451 Data Processing $ 116,676 $ 124,249 $ 158,779 $ 185,689.20 $ 173,752 Dues & Memberships $ 53,650 $ 53,262 $ 67,021 $ 72,601.20 $ 72,321 Fees & Permits $ 146,445 $ 173,052 $ 152,224 $ 157,959.60 $ 169,437 Board Election $ - $ - $ - $ - $ 69,750 Insurance $ 212,136 $ 242,338 $ 278,293 $ 309,663.60 $ 291,406 Materials $ 483,301 $ 734,474 $ 568,676 $ 700,435.60 $ 579,369 District Activities, Emp Recognition $ 12,066 $ 20,053 $ 23,390 $ 14,038.80 $ 22,980 Maintenance $ 398,747 $ 353,309 $ 357,243 $ 268,305.60 $ 329,546 Non - Capital Equipment $ 94,576 $ 164,430 $ 121,534 $ 98,556 $ 132,525 Office Expense $ 42,245 $ 39,441 $ 42,920 $ 32,631.60 $ 37,642 Professional Services $ 873,650 $ 876,546 $ 747,785 $ 575,798.40 $ 672,197 Training $ 34,710 $ 19,741 $ 64,403 $ 26,054.40 $ 58,571 Travel & Conferences $ 19,194 $ 23,883 $ 48,389 $ 26,484 $ 42,129 Uncollectible Accounts $ 21,833 $ 32,089 $ 23,250 '$ 26,912.80 $ 37,200 Utilities $ 66,904 $ 85,903 $ 83,700 $ 31,268.40 $ 83,700 Vehicle Expenses $ 278,209 $ 318,240 $ 321,250 $ 320,116.80 $ 281,139 Supplies & Services Sub -Total $ 3,461,250 $ 3,890,552 $ 3,846,315 $ 3,534,870 $ 3,848,902 Total Operating Expenses $21,862,795 $ 23,790,095 $24,601,177 $ 24,911,223 $26,141,346 Expenses (Non- Operating) Interest on Long Term Debt $ 1,625,865 $ 1,781,416 $ 1,815,317 $ 1,733,122 $ 1,780,793 Other Expense $ 90,485 $ 228,364 $ 70,400 $ 44,263 $ 72,000 Total Non - Operating Expenses $ 1,716,350 $ 2,009,780 $ 1,885,717 $ 1,777,385 $ 1,852,793 Total Expenses $23,579,145 $ 25,799,875 $26,486,894 $ 26,688,608 $27,994,139 Net Income (Loss) Before Capital Contributions $ 4,239,159 $ 3,291,530 $ 3,535,737 $ 5,155,508 $ 3,080,750 Transfers (To) /From $ (5,085,111) $ - $ - $ - $ - Capital Contributions $ 98,241 $ 711,319 $ - $ 649,000 $ - Net Income (Loss) Before Depreciation $ (747,711) $ 4,002,849 $ 3,535,737 $ 5,804,508 $ 3,080,750 Depreciation $ 5,359,086 $ 5,580,026 $ 5,598,640 $ 5,946,910 $ 5,992,500 Income (Loss) $ (6,106,797) $ (1,577,177) $ (2,062,903) $ (142,402) $ (2,911,750) Total Revenue and Expenses (Water), Continued ,35,000,000 Water Revenues & Expenses (Does not include ,30,000,000 $28,839,612 $26,369,939 $27,500,685 $24,998,673 25,000,000 $24,601, 77 $23,790,095 20,000,000 $21,862,795 ,15,000,000 10,000,000 $5,000,000 $0 $28,499,644 23 FY 2011/12 Actual FY 2012/13 Actual FY 2013/14 Budget FY 2013/14 FY 2014/15 Budget Forecast Total Water Revenues —11—Total Water Expenses FY 2014/15 Revenues (Water) ■ Water Sales ■ Service Charges ■ Other Operating Revenue ■ interest income ■ Property Taxes ■ Other Non- Operating Total: $31,074,889 FY 2014/15 Expenses (Water) • Depreciation & Amortization • Variable Water Costs • Salary and Related Expenses • Supplies & Services • Interest on Long Term Debt • Other Expenses Total: $27,994,139 ANNUAL OPERATING W Total Revenue and Expenses (Sewer) Salary Related Expenses FY 2011/12 FY 2012/13 FY 2013/14 FY 2013/14 FY 2014/15 $ 881,290 Actual Actual Budget Forecast Budget Revenue (Operating): $ (19,950) Salary Related Expenses Total $ 853,396 $ 835,522 Sewer Charge Revenue $ 1,580,369 $ 1,561,850 $1,550,530 $1,556,764 $1,605,292 Sewer Parcel Assessments $ 205,435 $ 200,189 $ 200,797 $ 200,797 $ 201,000 Other Operating Revenue $ 94,408 $ 38,661 $ 36,675 $ 89,043 $ 49,774 Total Operating Revenue $ 1,880,213 $ 1,800,700 $1,788,002 $1,846,604 $1,856,066 Revenue (Non- Operating): $ 9,056 $ 9,177 $ 11,951 $ 10,115 Interest $ 23,659 $ 16,359 $ 12,000 $ 8,300 $ 12,000 Other Non - Operating Revenue $ 267,186 $ 14,430 $ 7,950 $ 37,500 $ 11,925 Total Non - Operating Revenue $ 290,845 $ 30,789 $ 19,950 $ 45,800 $ 23,925 Total Revenue $ 2,171,058 $ 1,831,489 $1,807,952 $1,892,404 $1,879,991 Expenses (Operating): $ 14,936 $ 20,947 $ 23,308 $ 21,934 Materials Variable Water Costs (G.W., Import & Power) $ - $ - $ - $ - $ - Salary Related Expenses $ 853,396 $ 835,522 $ 932,669 $ 936,615 $ 881,290 Reduction for Capital Project Labor $ - $ - $ (15,000) $ (7,678) $ (19,950) Salary Related Expenses Total $ 853,396 $ 835,522 $ 917,669 $ 928,937 $ 861,340 Supplies & Services Communications $ 15,133 $ 12,577 $ 21,829 $ 13,079 $ 21,108 Contractual Services $ 29,998 $ 33,400 $ 38,751 $ 39,167 $ 39,249 Data Processing $ 9,056 $ 9,177 $ 11,951 $ 10,115 $ 13,078 Dues & Memberships $ 4,782 $ 4,140 $ 5,314 $ 5,495 $ 5,744 Fees & Permits $ 7,701 $ 15,302 $ 15,141 $ 14,573 $ 16,753 Board Election $ - $ - $ - $ - $ 5,250 Insurance $ 16,668 $ 14,936 $ 20,947 $ 23,308 $ 21,934 Materials $ 21,051 $ 18,064 $ 19,099 $ 66,674 $ 78,756 District Activities, Emp Recognition $ 907 $ 1,370 $ 1,761 $ 1,049 $ 1,730 Maintenance $ 134,185 $ 104,354 $ 121,908 $ 86,032 $ 112,605 Non - Capital Equipment $ 16,800 $ 18,415 $ 16,417 $ 18,808 $ 19,475 Office Expense $ 3,832 $ 2,902 $ 3,231 $ 7,548 $ 2,833 Professional Services $ 34,310 $ 30,272 $ 37,425 $ 26,146 $ 39,413 Training $ 4,320 $ 5,365 $ 6,757 $ 6,469 $ 6,609 Travel & Conferences $ 1,294 $ 1,578 $ 4,062 $ 1,927 $ 4,371 Uncollectible Accounts $ 1,162 $ 4,294 $ 1,750 $ 4,290 $ 2,800 Utilities $ 5,123 $ 6,430 $ 7,100 $ 3,265 $ 7,100 Vehicle Expenses $ 43,547 $ 49,270 $ 45,899 $ 61,174 $ 77,261 Supplies & Services Sub -Total $ 349,869 $ 331,846 $ 379,339 $ 389,117 $ 476,067 Total Operating Expenses $ 1,203,265 $ 1,167,368 $1,297,008 $1,318,054 $1,337,406 Expenses (Non- Operating): Interest Expense $ 325 $ - $ - $ $ Other Expense $ 18,499 $ $ 6,000 $ $ Total Non - Operating Expenses $ 18,824 $ $ 6,000 $ $ Total Expenses $ 1,222,089 $ 1,167,368 $1,303,008 $1,318,054 $1,337,406 Net Income (Loss) Before Capital Contributions $ 948,968 $ 664,121 $ 504,944 $ 574,350 $ 542,585 Transfer(To) /From $ 85,111 $ - $ - $ - $ - Capital Contributions $17,115,898 $ 463,354 $ - $ 130,000 $ - Net Income Before Depreciation $18,149,977 $ 1,127,475 $ 504,944 $ 704,350 $ 542,585 Depreciation $ 932,700 $ 1,304,187 $1,299,301 $1,323,398 $1,345,000 Income (Loss) $17,217,277 $ (176,712) $ (794,357) $ (619,048) $ (802,415) $1,600,000 $1,400,000 $1,200,000 $1,000,000 $800,000 $600,000 $400,000 $200,000 $0 4A Total Revenue and Expenses (Sewer), Continued Sewer Revenues & Expenses (Does not include depreciation expense) FY 2011/12 Actual FY 2012/13 Actual FY 2013/14 Budget FY 2013/14 Forecast FY 2014/15 Budget iiiiiiiiiiilTotal Sewer Revenues --M--Total Sewer Expenses FY 2014/15 Revenues (Sewer) m Sewer Charge Revenue ■ Sewer parcel Ass, -smenh ■ Other operating revenue • Interest Income ■Other Income Total: $1,879,991 FY 2014/15 Expenses (Sewer) al tg o ■ Depreclation • Salary & Benefits • supple- & Services Total: $1,337,406 Total Revenues by Fund Total Revenues FY 2011/12 FY 2012/13 FY 2013/14 FY 2013/14 FY 2014/15 Actual Actual Budget Forecast Budget Water Revenue $ 27,818,304 $ 29,091,405 $ 30,022,631 $ 31,844,116 $ 31,074,889 Sewer Revenue $ 2,171,058 $ 1,831,489 $ 1,807,952 $ 1,892,404 $ 1,879,991 Total Operating Revenue: $ 29,989,362 $ 30,922,894 $ 31,830,583 $ 33,736,520 $ 32,954,880 Total Revenues $35,000,000 $30,000,000 $25,000,000 $20,000,000 $15,000,000 $10,000,000 $5,000,000 $- FY 2011/12 Actual FY 2012/13 Actual FY 2013/14 Budget FY 2013/14 Forecast FY 2014/15 Budget ■ Water Revenue ■ Sewer Revenue Water Revenue s1+,BOB B3Aaao $31,844 $31,075 $30,023 336,663 $29,091 Saa1bB $27,618 52BABB SbaoD S22,BBB S2BABB . "Ml/12M 3Y2012/13A NM3/14BWp1 ""3/14 a "20WU&,l Sz,saB $2,171 31,000 SLSm SIAIB SsoB Sewer Revenue s "M1112AdW R2012/O3 W N20 V14BOBh1 3Y2013/143aotnt RM4 /081dz� Total Expenses by Fund FY 2011/12 FY 2012/13 FY 2013/14 Actual Actual Budget qt FY 2013/14 FY 2014/15 Forecast Budget Water $21,862,795 $23,790,095 $24,601,177 $29,874,111 $26,141,346 Sewer $1,203,265 $1,167,368 $1,297,008 $1,318,054 $1,337,406 Total Operating Expenses: $23,066,060 $24,957,463 $25,898,185 $31,192,165 $27,478,753 Note: Depreciation Not Included Total Expenses $35,000,000 $30,000,000 $25,000,000 $20,000,000 $15,000,000 $10,000,000 $5,000,000 $0 FY 2011112 Actual FY 2012/13 Actual FY 2013/14 Budget FY 2013/14 Forecast FY 2014/15 Budget ■ Water ■ Sewer Sewer Expenses iaas.w wee axavmn .amsn sz,sso SLSOo sz.ao stsao s�>so sl�ao Sioso .rzmz/z:,x...i rr zou/z3,x..x rr zo1z/za wes.c wzma/ze r«.rn rrzmHzsewsz Supplies g 12% ($4.3r L7 $16,000 $14,000 $12,000 M $10,000 $8,000 0 1= $6,000 $4,000 $2,000 Salary Expel 22' ($8.� 4A Total Expenses by Category FY 2014/15 Budget Depreciation & Oth- Fvn-p Total: $36,660,045 Five Year Cost Comparison Five Year Cost Comparison Depreciation Variable Costs ■ FY 2011/12 Actual ■ FY 2012/13 Actual Salaries & Supplies & Interest Other Ben. Svcs. ■ FY 2013/14 Budget ■ FY 2013/14 Forecast L. FY 2014/15 Budget Variable Water Cost Expenses FY 2014/15 $1,525,136 (10 %) $3,833,851 (26 %) $8,427,136 (56 %) ■ Import Water ■ Power & Pumping Costs ■ Groundwater ■ CUP ........ ,._ 9253 972 Note: The Variable Water Costs category is the largest component of the FY 2014/15 Budgeted Operating Costs and includes imported and groundwater purchases, as well as power costs associated with pumping water throughout the District. These costs are listed in the Total Water Revenues and Expenses and Water Revenues and Expenses schedules on pages 56 and 58, respectively. = —Lo ANNUAL OPERATING W Reserves & Funding Sources Forecasted Budgeted Balance Balance Balance Additions Balances Ending Ending Ending (Deductions) Ending Funding Sources Restriction Category 6/30/2013 4/30/2014 6/30/2014 FY 2013/14 6/30/2014 Water (Operating): Operating Fund Operating Reserve 4,719,010 4,041,785 3,800,000 (663,038) 3,136,962 Reserve for Debt Service Debt Service Payment 1,304,228 2,728,996 2,723,509 - 2,723,509 Employee Liabilities OPEB and Comp Abs. - 93,035 93,035 92,965 186,000 Water (Capital) Water Emergency Emergency Reserve 990,234 1,005,031 1,000,000 - 1,000,000 Water Capital Projects Capital Reserve* 7,774,174 7,898,185 7,725,000 1,303,823 9,028,823 COP Bond 2008 - Reserve Restricted from Use ** 2,160,389 2,124,670 2,147,096 - 2,147,096 Water Maintenance Capital Reserve 200,715 191,658 200,000 200,000 Sewer (Operating): Operating Fund Operating Reserve 246,893 741,587 300,000 (139,511) 160,489 Employee Liabilities OPEB and Comp Abs. - 7,003 7,003 6,997 14,000 Sewer (Capital) Sewer Emergency Emergency Reserve 1,001,806 1,007,297 1,000,000 - 1,000,000 Sewer Capital Projects Capital Reserve 1,167,222 1,402,212 1,174,204 203,099 1,377,303 Total of Funds $ 19,564,671 $ 21,241,459 $ 20,169,847 $ 804,335 $ 20,974,182 *Amount includes an assumption of $5,267,352 borrowed against a line of credit in FY 13/14 and $1,173,648 in FY 14/15 * *Amount has been set aside by the fiscal agent in a reserve fund, and is unable to be spent down ..eo 1.30 380 330 2.81) z3o ieo L3o 0.80 0.30 (0.10) 1� Projected Reserves & Funding Levels Reserve Targets and Projected Funding Levels isz Ld - I Operating (water) Operating (Sewer) Emergency (Water) Emergency (Sewer) Capital (Water)* Capital (Sewer)- Maintenance Employee Liabilities deserve for Debt (Water) (W &S)" Service (Water) ■ Minimum target ■ Maximum target ■ Proje. ted Balance ((n) 6/30/14) Five Year Financial Projections (FY 2014 -2019) Narrative This financial projection is designed to provide a general understanding of how revenues and expenditures are expected to influence the District over the next five years. Revenue and expenditure projections are reviewed in relation to their effect on funding capital projects, reserve levels, and operating fund balances. The District will update its projections on an annual basis in order to plan for the future and determine recommended rates. The projection factors in debt ratios, reserve balances, projected rate increases, cost increases and growth projections. The assumptions in the following projections include: • Costs passed- through for all variable water cost rate increases • Annual increases on the water commodity rate of 2.5% • Annexation to OCWD in FY 14/15 • $7 million borrowing through a Line of Credit in FY 12/13 at an interest rate of One Month LIBOR + 0.90 %, with renewals every 3 years • Principal repayment due September 16, 2016 • A 0.04% annual growth in customer accounts • No change to the sewer rate, but an alignment to address a disparity in our rates in FY 2015/16 • Average interest earnings at 0.3 % - 1.2% • 1 % growth in property taxes • 1.5% annual increase in other non- operating revenue other than annexation amortization • 4% - 6.5% annual increases in variable water costs • 5.0% annual increases in salary related expenses • 3 -8% annual increases in supplies and services expenses with the following exceptions: ➢ Board Election expense only budgeted every other year • Interest expense equal to those scheduled by the existing bonds and assumed interest rate of 1.5 -2.0% for Line of Credit • No change to future budgets for other non - operating expenses • Depreciation increases based on the projected completion of CIP jobs The District is still in the middle of an aggressive CIP spending plan that was created with the issuance of the 2008 Certificates of Participation. The following projections include the completion of that spending plan. ANNUAL OPERATING W Five Year Financial Projections Water & Sewer FY 2014/15 FY 2015/16 FY 2016/17 FY 2017/18 FY 2018/19 Budget Budget Budget Budget Budget Revenue (Operating): Water Revenue (Residential) $17,154,552 $17,338,876 $18,086,654 $18,683,665 $19,468,375 Water Revenue (Commercial & Fire Det.) $ 2,074,097 $ 2,159,902 $ 2,253,052 $ 2,327,422 $ 2,425,173 Water Revenue (Landscape /Irrigation) $ 4,792,995 $ 5,025,625 $ 5,246,679 $ 5,423,164 $ 5,655,136 Service Charges $ 4,478,000 $ 5,294,707 $ 6,176,646 $ 7,087,940 $ 7,867,613 Sewer Charge Revenue $ 1,605,292 $ 1,609,787 $ 1,614,294 $ 1,618,814 $ 1,623,347 Sewer Parcel Assessments $ 201,000 $ 201,000 $ 201,000 $ 201,000 $ 201,000 Other Operating Revenue $ 719,777 $ 729,827 $ 740,028 $ 750,382 $ 760,891 Total Operating Revenue $31,025,713 $32,359,724 $34,318,353 $36,092,387 $38,001,535 Revenue (Non- Operating): Interest $ 112,000 $ 135,228 $ 168,059 $ 226,153 $ 204,440 Property Tax $ 1,283,642 $ 1,296,479 $ 1,309,443 $ 1,322,538 $ 1,335,763 Other Non - Operating Revenue $ 533,525 $ 535,137 $ 536,781 $ 538,458 $ 540,169 Total Non - Operating Revenue $ 1,929,167 $ 1,966,844 $ 2,014,283 $ 2,087,150 $ 2,080,372 Total Revenue $32,954,880 $34,326,568 $36,332,637 $38,179,537 $40,081,907 Expenses (Operating): Variable Water Costs $14,928,972 $14,052,319 $14,163,929 $14,877,435 $15,621,307 Salary Related Expenses $ 8,224,812 $ 8,636,053 $ 9,067,855 $ 9,521,248 $ 9,997,310 Supplies & Services: Communications $ 294,894 $ 318,486 $ 334,410 $ 344,442 $ 354,775 Contractual Services $ 560,700 $ 605,556 $ 635,834 $ 654,909 $ 674,556 Data Processing $ 186,830 $ 201,776 $ 211,865 $ 218,221 $ 224,768 Dues & Memberships $ 78,065 $ 84,310 $ 88,526 $ 91,181 $ 93,917 Fees & Permits $ 186,190 $ 201,085 $ 211,139 $ 217,474 $ 223,998 Board Election $ 75,000 $ - $ 50,000 $ - $ 75,000 Insurance $ 313,340 $ 329,007 $ 345,457 $ 362,730 $ 380,867 Materials $ 658,125 $ 710,775 $ 746,314 $ 768,703 $ 791,764 District Activities, Emp Recognition $ 24,710 $ 26,687 $ 28,021 $ 28,862 $ 29,728 Maintenance $ 442,150 $ 477,522 $ 501,398 $ 516,440 $ 531,933 Non - Capital Equipment $ 152,000 $ 164,160 $ 172,368 $ 177,539 $ 182,865 Office Expense $ 40,475 $ 43,713 $ 45,899 $ 47,276 $ 48,694 Professional Services $ 711,610 $ 768,539 $ 806,966 $ 831,175 $ 856,110 Training $ 65,180 $ 70,394 $ 73,914 $ 76,132 $ 78,415 Travel & Conferences $ 46,500 $ 50,220 $ 52,731 $ 54,313 $ 55,942 Uncollectible Accounts $ 40,000 $ 43,200 $ 45,360 $ 46,721 $ 48,122 Utilities $ 90,800 $ 98,064 $ 102,967 $ 106,056 $ 109,238 Vehicle Equipment $ 358,400 $ 387,072 $ 406,426 $ 418,618 $ 431,177 Supplies & Services Sub -Total $ 4,324,969 $ 4,580,566 $ 4,859,595 $ 4,960,792 $ 5,191,870 Total Operating Expenses $27,478,753 $27,268,938 $28,091,379 $29,359,475 $30,810,487 Expenses (Non- Operating): Interest Expense $ 1,780,793 $ 1,816,559 $ 1,776,884 $ 1,734,309 $ 1,688,509 Other Expense $ 72,000 $ 72,000 $ 72,000 $ 72,000 $ 72,000 Total Non - Operating Expenses $ 1,852,793 $ 1,888,559 $ 1,848,884 $ 1,806,309 $ 1,760,509 Total Expenses $29,331,545 $29,157,497 $29,940,263 $31,165,784 $32,570,996 Net Income (Loss) Before Depreciation $ 3,623,335 $ 5,169,071 $ 6,392,374 $ 7,013,753 $ 7,510,911 Depreciation $ 7,337,500 $ 7,763,632 $ 8,016,132 $ 8,157,132 $ 8,550,992 Income (Loss) $ (3,714,165) $ (2,594,562) $ (1,623,759) $ (1,143,379) $ (1,040,081) = � ANNUAL OPERATING w Five Year Financial Projections Water FY 2014/15 FY 2015/16 FY 2016/17 FY 2017/18 FY 2018/19 Budget Budget Budget Budget Budget Revenue (Operating): Water Revenue (Residential) $ 17,154,552 $ 17,338,876 $ 18,086,654 $ 18,683,665 $19,468,375 Water Revenue (Commercial & Fire Det.) $ 2,074,097 $ 2,159,902 $ 2,253,052 $ 2,327,422 $ 2,425,173 Water Revenue (Landscape /Irrigation) $ 4,792,995 $ 5,025,625 $ 5,246,679 $ 5,423,164 $ 5,655,136 Service Charges $ 4,478,000 $ 5,294,707 $ 6,176,646 $ 7,087,940 $ 7,867,613 Other Operating Revenue $ 670,003 $ 680,053 $ 690,254 $ 700,608 $ 711,117 Total Operating Revenue $ 29,169,647 $ 30,499,163 $ 32,453,286 $ 34,222,799 $36,127,414 Revenue (Non- Operating): Interest $ 100,000 $ 120,708 $ 150,054 $ 202,027 $ 202,027 Property Tax $ 1,283,642 $ 1,296,479 $ 1,309,443 $ 1,322,538 $ 1,335,763 Other Non - Operating Revenue $ 521,600 $ 523,212 $ 524,856 $ 526,533 $ 528,244 Total Non - Operating Revenue $ 1,905,242 $ 1,940,399 $ 1,984,354 $ 2,051,098 $ 2,066,034 Total Revenue $ 31,074,889 $ 32,439,562 $ 34,437,639 $ 36,273,897 $38,193,448 Expenses (Operating): Variable Water Costs $ 14,928,972 $ 14,052,319 $ 14,163,929 $ 14,877,435 $15,621,307 Salary Related Expenses $ 7,363,472 $ 7,731,646 $ 8,118,228 $ 8,524,140 $ 8,950,347 Supplies & Services: Communications $ 273,786 $ 295,689 $ 310,474 $ 319,788 $ 329,382 Contractual Services $ 521,451 $ 563,167 $ 591,325 $ 609,065 $ 627,337 Data Processing $ 173,752 $ 187,652 $ 197,035 $ 202,946 $ 209,034 Dues & Memberships $ 72,321 $ 78,107 $ 82,013 $ 84,473 $ 87,007 Fees & Permits $ 169,437 $ 182,992 $ 192,141 $ 197,905 $ 203,843 Board Election $ 69,750 $ - $ 46,500 $ - $ 69,750 Insurance $ 291,406 $ 305,977 $ 321,275 $ 337,339 $ 354,206 Materials $ 579,369 $ 625,719 $ 657,005 $ 676,715 $ 697,016 District Activities, Emp Recognition $ 22,980 $ 24,819 $ 26,060 $ 26,841 $ 27,647 Maintenance $ 329,546 $ 355,909 $ 373,705 $ 384,916 $ 396,463 Non - Capital Equipment $ 132,525 $ 143,127 $ 150,283 $ 154,792 $ 159,436 Office Expense $ 37,642 $ 40,653 $ 42,686 $ 43,966 $ 45,285 Professional Services $ 672,197 $ 725,973 $ 762,272 $ 785,140 $ 808,694 Training $ 58,571 $ 63,257 $ 66,420 $ 68,413 $ 70,465 Travel & Conferences $ 42,129 $ 45,499 $ 47,774 $ 49,208 $ 50,684 Uncollectible Accounts $ 37,200 $ 40,176 $ 42,185 $ 43,450 $ 44,754 Utilities $ 83,700 $ 90,396 $ 94,916 $ 97,763 $ 100,696 Vehicle Equipment $ 281,139 $ 303,630 $ 318,812 $ 328,376 $ 338,227 Supplies & Services Sub -Total $ 3,848,902 $ 4,072,742 $ 4,322,879 $ 4,411,096 $ 4,619,926 Total Operating Expenses $ 26,141,346 $ 25,856,707 $ 26,605,037 $ 27,812,671 $29,191,579 Expenses (Non- Operating): Interest Expense $ 1,780,793 $ 1,816,559 $ 1,776,884 $ 1,734,309 $ 1,688,509 Other Expense $ 72,000 $ 72,000 $ 72,000 $ 72,000 $ 72,000 Total Non - Operating Expenses $ 1,852,793 $ 1,888,559 $ 1,848,884 $ 1,806,309 $ 1,760,509 Total Expenses $ 27,994,139 $ 27,745,266 $ 28,453,921 $ 29,618,980 $30,952,088 Net Income (Loss) Before Depreciation $ 3,080,750 $ 4,694,295 $ 5,983,719 $ 6,654,917 $ 7,241,360 Depreciation $ 5,992,500 $ 6,418,632 $ 6,671,132 $ 6,812,132 $ 7,205,992 Income (Loss) $ (2,911,750) $ (1,724,337) $ (687,414) $ (157,215) $ 35,368 Debt Service Coverage 1.75 2.34 2.80 3.04 3.24 = � ANNUAL OPERATING W Five Year Financial Projections Sewer FY 2014/15 FY 2015/16 FY 2016/17 FY 2017/18 FY 2018/19 Budget Budget Budget Budget Budget Revenue (Operating): Sewer Charge Revenue $ 1,605,292 $ 1,609,787 $ 1,614,294 $ 1,618,814 $ 1,623,347 Sewer Parcel Assessments $ 201,000 $ 201,000 $ 201,000 $ 201,000 $ 201,000 Other Operating Revenue $ 49,774 $ 49,774 $ 49,774 $ 49,774 $ 49,774 Total Operating Revenue $ 1,856,066 $ 1,860,561 '$ 1,865,068 $ 1,869,588 $ 1,874,121 Revenue (Non- Operating): Interest $ 12,000 $ 14,520 $ 18,005 $ 24,126 $ 2,413 Other Non - Operating Revenue $ 11,925 $ 11,925 $ 11,925 $ 11,925 $ 11,925 Total Non - Operating Revenue $ 23,925 $ 26,445 F$ 29,930 $ 36,051 $ 14,338 Total Revenue $ 1,879,991 $ 1,887,006 $ 1,894,998 $ 1,905,640 $ 1,888,459 Expenses (Operating): Salary Related Expenses $ 861,340 $ 904,407 $ 949,627 $ 997,108 $ 1,046,964 Supplies & Services: Communications $ 21,108 $ 22,796 $ 23,936 $ 24,654 $ 25,394 Contractual Services $ 39,249 $ 42,389 $ 44,508 $ 45,844 $ 47,219 Data Processing $ 13,078 $ 14,124 $ 14,831 $ 15,275 $ 15,734 Dues & Memberships $ 5,744 $ 6,203 $ 6,513 $ 6,709 $ 6,910 Fees & Permits $ 16,753 $ 18,094 $ 18,998 $ 19,568 $ 20,155 Board Election $ 5,250 $ - $ 3,500 $ - $ 5,250 Insurance $ 21,934 $ 23,030 $ 24,182 $ 25,391 $ 26,661 Materials $ 78,756 $ 85,056 $ 89,309 $ 91,988 $ 94,748 District Activities, Emp Recognition $ 1,730 $ 1,868 $ 1,961 $ 2,020 $ 2,081 Maintenance $ 112,605 $ 121,613 $ 127,694 $ 131,524 $ 135,470 Non - Capital Equipment $ 19,475 $ 21,033 $ 22,085 $ 22,747 $ 23,430 Office Expense $ 2,833 $ 3,060 $ 3,213 $ 3,309 $ 3,409 Professional Services $ 39,413 $ 42,566 $ 44,694 $ 46,035 $ 47,416 Training $ 6,609 $ 7,137 $ 7,494 $ 7,719 $ 7,951 Travel & Conferences $ 4,371 $ 4,721 $ 4,957 $ 5,105 $ 5,259 Uncollectible Accounts $ 2,800 $ 3,024 $ 3,175 $ 3,270 $ 3,369 Utilities $ 7,100 $ 7,668 $ 8,051 $ 8,293 $ 8,542 Vehicle Equipment $ 77,261 $ 83,442 $ 87,614 $ 90,242 $ 92,950 Supplies & Services Sub -Total $ 476,067 $ 507,824 $ 536,715 $ 549,695 $ 571,944 Total Operating Expenses $ 1,337,406 $ 1,412,231 F$ 1,486,342 $ 1,546,804 $ 1,618,908 Expenses (Non- Operating): Other Expense $ - $ - $ - $ - $ - Total Non - Operating Expenses $ - $ - $ - $ - $ - Total Expenses $ 1,337,406 $ 1,412,231 $ 1,486,342 $ 1,546,804 $ 1,618,908 Net Income (Loss) Before Depreciation $ 542,585 $ 474,775 $ 408,656 $ 358,836 $ 269,551 Depreciation $ 1,345,000 $ 1,345,000 $ 1,345,000 $ 1,345,000 $ 1,345,000 Income (Loss) $ (802,415) $ (870,225) $ (936,344) $ (986,164) $ (1,075,449) Five Year Financial Projections Reserve Balances- Water FY 2014/15 FY 2015116 FY 2016/17 FY 2017/18 FY 2017/18 Budget Budget Budget Budget Budget Operating Reserves Ending Balance $ 3,136,962 $ 3,102,805 $ 3,192,604 $ 3,337,521 $ 3,502,990 Minimum Balance $ 2,091,308 $ 2,068,537 $ 2,128,403 $ 2,225,014 $ 2,335,326 Maximum Balance $ 4,444,029 $ 4,395,640 $ 4,522,856 $ 4,728,154 $ 4,962,568 Capital Replacement Reserves Ending Balance $ 9,028,823 $ 4,441,098 $ 1,820,000 $ 1,820,000 $ 1,820,000 Minimum Balance* $ 1,820,000 $ 1,820,000 $ 1,820,000 $ 1,820,000 $ 1,820,000 Maintenance Reserves Ending Balance $ 200,000 $ 200,000 $ 200,000 $ 200,000 $ 200,000 Minimum Balance $ 200,000 $ 200,000 $ 200,000 $ 200,000 $ 200,000 Emergency Reserves Ending Balance $ 1,000,000 $ 1,000,000 $ 1,000,000 $ 1,000,000 $ 1,000,000 Minimum Balance $ 1,000,000 $ 1,000,000 $ 1,000,000 $ 1,000,000 $ 1,000,000 Debt Service Reserves Ending Balance $ 2,723,509 $ 2,721,559 $ 2,716,884 $ 2,714,309 $ 2,714,309 Minimum Balance $ 2,723,509 $ 2,721,559 $ 2,716,884 $ 2,714,309 $ 2,714,309 COP Reserves Ending Balance �$ 2,147,096 $ 2,147,096 $ 2,147,096 $ 2,147,096 $ 2,147,096 Minimum Balance $ 2,147,096 $ 2,147,096 $ 2,147,096 $ 2,147,096 $ 2,147,096 Employee Benefit Liability Reserves Ending Balance $ 186,000 $ 279,000 $ 372,000 $ 465,000 $ 558,000 Minimum Balance* $ 93,000 $ 93,000 $ 93,000 $ 93,000 $ 93,000 Reserve for Debt Service $ 2,723,509 $ 2,723,509 $ 2,723,509 $ 2,723,509 $ 2,723,509 Ending Balance $ 2,723,509 $ 2,723,509 $ 2,723,509 $ 2,723,509 $ 2,723,509 Minimum Balance* Total Water Reserves Ending Balance $21,145,899 $16,615,067 $14,172,093 $14,407,435 $14,665,904 Minimum Balance $12,798,422 $12,773,701 $12,828,892 $12,922,928 $13,033,240 Minimum Balance is actually minimum annual funding $75.000.000 $20,000,000 $15,000,000 $10,000,000 $S,OOO,000 s Water Enterprise Five Year Reserve Balance Projection FY 2014/15 Budget FY 2015 /16 Budget FY 7016/17 Budget FY 7017118 Budget FY 7017/18 Budget Ending Balance t Minimum Balance Five Year Financial Projections Reserve Balances- Sewer Operation Reserves Ending Balance Minimum Balance Maximum Balance Capital Replacement Reserves Ending Balance Minimum Balance' Emergency Reserves Ending Balance Minimum Balance Employee Liability Reserves Ending Balance Minimum Balance Total Sewer Reserves Ending Balance Minimum Balance *Minimum Balance is actuallyminimum annual funding $3AO,000 $2,'8,000 $2A0,000 $11500A00 51,00,a00 $50,000 S FY 2014/15 FY 2015/16 FY 2016/17 FY 2017/18 FY 2018/19 Budget Budget Budget Budget Budget $ 160,489 $ 169,468 $ 178,361 $ 185,616 $ 194,269 $ 106,993 $ 112,978 $ 118,907 $ 123,744 $ 129,513 $ 227,359 $ 240,079 $ 252,678 $ 262,957 $ 275,214 $ 1,396,500 $ 1,353,866 $ 1,366,769 $ 1,441,941 $ 1,517,113 $ 345,000 $ 345,000 $ 345,000 $ 345,000 $ 345,000 $ 1,000,000 $ 1,000,000 $ 1,000,000 $ 1,000,000 $ 1,000,000 $ 250,000 $ 250,000 $ 250,000 $ 250,000 $ 250,000 $ 14,000 $ 21,000 $ 28,000 $ 35,000 $ 42,000 $ 2,570,989 $ 2,544,334 $ 2,573,130 $ 2,662,557 $ 2,753,382 $ 701,993 $ 707,978 $ 713,907 $ 718,744 $ 724,513 Sewer Enterprise Five Year Reserve Balance Projection FY 2014/15 Budget FY 2015/16 Budget FY 2016/17 Budget FY 2017 /18 Budget FY 2018/19 Budget � Ending Balance -a- Minimum Balance 4.4 Fund Balance History (FYE 2011 -2015) Fiscal Year - Water Sewer 1,757,561 Ending 865,113 Funds Fund Total 06/30/11 Net Income Before Capital Contributions (763,535) (684,679) (1,448,214) 687,391 Capital Contributions 364,564 341,755 706,319 33,736,520 Prior Period Adjustment - 410,247 410,247 130,000 Fund Balance @ 6/3012011 $ 128,345,300 $ 25,890,373 $ 154,235,673 06/30/12 Net Income Before Capital Contributions (1,119,927) (287,672) (1,407,599) Capital Contributions 98,241 17,115,898 17,214,139 Transfers In (Out) (85,111) 85,111 0 Extraordinary Item (5,000,000) - (5,000,000) Fund Balance @ 6/30/2012 $ 122,238,503 $ 42,803,710 $ 165,042,213 06/30/13 Net Income Before Capital Contributions (2,288,495) (640,066) (2,928,561) Capital Contributions 711,319 463,354 1,174,673 Prior Period Adjustment (1,561,743) - (1,561,743) Fund Balance @ 6/30/2012 $ 119,099,584 $ 42,626,998 $ 161,726,582 06/30/14 Revenue (Operating): Water Sales Sewer Revenues Other Operating Revenue Interest Property Taxes Other Non - Operating Revenue Total Estimated Revenues FY2014 Expenses (Operating): Variable Water Costs (G.W., Import & Power) Salary Related Expenses Supplies & Services Depreciation Interest on Long Term Debt Other Expense Total Estimated Expenses FY2014 Net Income(Loss) Before Capital Contributions Capital Contributions Net Income(Loss) FY 2014 Estimated Fund Balance @ 6/30/2014 06/30/15 Revenue (Operating): Water Sales Sewer Revenues Other Operating Revenue Interest Property Taxes Other Non - Operating Revenue Total Estimated Revenues FY2015 Expenses (Operating): Variable Water Costs (G.W., Import & Power) Salary Related Expenses Supplies & Services Depreciation Interest on Long Term Debt Other Expense Total Estimated Expenses FY2015 Net Income(Loss) FY 2015 Estimated Fund Balance @ 6/30/2015 28,839,612 - 28,839,612 - 1,757,561 1,757,561 865,113 89,043 954,156 102,000 8,300 110,300 1,350,000 - 1,350,000 687,391 37,500 724,891 31,844,116 1,892,404 33,736,520 14,721,591 - 14,721,591 6,654,763 928,937 7,583,700 3,534,870 389,117 3,923,987 5,946,910 1,323,398 7,270,308 1,733,122 - 1,733,122 44,263 - 44,263 32,635,518 2,641,452 35,276,970 (791,402) (749,048) (1,540,450) 649,000 130,000 779,000 (142,402) (619,048) (761,450) $ 118,957,182 $ 42,007,950 $ 160,965,131 28,499,644 - 28,499,644 - 1,806,292 1,806,292 670,003 49,774 719,777 100,000 12,000 112,000 1,283,642 - 1,283,642 521,600 11,925 533,525 31,074,889 1,879,991 32,954,880 14,928,972 - 14,928,972 7,363,472 861,340 8,224,812 3,848,902 476,067 4,324,969 5,992,500 1,345,000 7,337,500 1,780,793 - 1,780,793 72,000 - 72,000 33,986,639 2,682,406 36,669,045 (2,911,750) (802,415) (3,714,165) $ 116,045,431 $ 41,205,535 $ 157,250,966 Debt Administration The District's debt rating from Fitch is "AX. The District has no formal debt policy and no legal debt limit; however, the District's future borrowing capacity is limited by the debt coverage ratio required by existing bond covenants. The ratio is calculated using revenue and expenses data pertaining to the Water Fund only and the covenants require that the coverage exceed 1.1. The District's budgeted ratio is 1.75 for Fiscal Year 2015. This District's Fiscal Year 2014/15 budgeted debt service obligation ($2,723,509) is related to its two existing debt issuances. Use of proceeds and the corresponding principal balance of each are as follows: Year of Issuance Use of Proceeds Principal Balance as of June 2014 2008 COP funds are being issued to finance certain capital $ 31,365,000 COP improvements, to fund a reserve fund, and to pay certain $ 1,010,000 costs of delivery. 1,713,509 2012A Refunding Bonds funds are being issued to finance certain 8,070,000 Refunding capital improvements, to fund a reserve fund, and to pay $ Bond certain costs of delivery. 2,721,559 2017 $ $ 39,435,000 Debt service requirements for the District's Certificates of Participation are as follows: Year -2025 Principal 6,850,000 Interest 6,701,525 Total 2015 $ 1,010,000 $ 1,713,509 $ 2,723,509 2016 $ 1,045,000 $ 1,676,559 $ 2,721,559 2017 $ 1,080,000 $ 1,636,884 $ 2,716,884 2018 $ 1,120,000 $ 1,594,309 $ 2,674,309 2019 $ 1,170,000 $ 1,548,509 $ 2,668,509 2020 $ 1,210,000 $ 1,500,909 $ 2,670,909 2021 -2025 $ 6,850,000 $ 6,701,525 $ 13,551,525 2026 -2029 $ 8,470,000 $ 5,032,963 $ 13,502,963 2030 -2034 $ 9,875,000 $ 3,004,944 $ 12,879,944 2035 -2039 $ 7,605,000 '$ 783,375 $ 8,388,375 Total $ 39,435,000 $ 25,193,485 $ 64,498,485 �YL ANNUAL OPERATING 53,000,000 $2,500,000 52,000,000 $1,500,000 - 51,000,000 - 5500,000 2.50 2.00 1.50 1.00 0.50 0.00 Yorba Linda WD South Coast WD Debt Administration, Continued 2015 -2020 Debt Service Requirements hi I'll, 201. 201-1 MIR 7019 2070 ■ Princgal ■ Interest Employees Per Capita Employees per Capita Serrano WD Walnut Valley Mesa Water WD * Note: Employees per Capita is for fiscal year 2013/14 and is measured in number of employees per thousand customers. Residential Meter Charge Comparison 3/4" Meter $32.21 $35.00 $30.00 $23.72 $25.00 $20.00 $17.08 $15.00 $15.00 $8.80 $10.00 $5.00 $- Yorba Linda WD South Coast WD Serrano WD Walnut Valley WD Mesa Water 1" Meter $42.69 $45.00 $40.00 $32.21 $35.00 $30.00 $25.00 $21.60 $25.00 $20.00 $14.67 $15.00 $10.00 $5.00 $- Yorba Linda WD South Coast WD Serrano WD Walnut Valley Mesa Water WD Note: Approximately 93% of the District's customer base has a 1 inch or smaller meter. The charges for all agencies are current as of FY 13/14. VLM ANNUAL OPERATING BUDGET FISCAL' CAPITAL PROJECTS VLM ANNUAL OPERATING BUDGET FISCAL` l J 2012 Pipeline Project �YL ANNUAL OPERATING Capital Improvement Plan YL Blvd BPS (Booster Pump Station) Total Project Increase/ Total Project Expenditures Project Description Budget (Decrease) Budget Through 556,789 $ (13/14) $ (14/15) 6/30/2013 YL Blvd BPS (Booster Pump Station) $ 3,115,000 (1,217,009) $ 1,897,991 $ 602,885 S & W Well Project (Well No. 21) $ 1,750,000 556,789 $ 2,306,789 $ 44,832 S & W Well Project (Well No. 22) $ 2,500,000 - $ 2,500,000 $ 2,742 Lakeview Grade Separation $ 600,000 - $ 600,000 $ 275,689 Deville Dr. Waterline Extension $ 50,000 - $ 50,000 $ - Fairmont BPS Upgrade $ 6,300,000 - $ 6,300,000 $ 142,012 Yorba Linda High School Park $ 370,000 - $ 370,000 $ 47,014 Rehabilitation & Restoration Meter Replacement Program $ 2,500,000 Actual Project (2,500,000) $ - $ - Future Pipeline Project $ 2,690,000 - $ 2,690,000 $ - Timber Ridge BPS Rehabilitiation $ 250,000 - $ 250,000 $ - Richfield Campus Spoils $ 150,000 - $ 150,000 $ - Lakeview Booster Piping $ 100,000 - $ 100,000 $ - Future PRS Rehabilitation $ 1,430,000 - $ 1,430,000 $ - Annual Routine Capital R &R $ 1,520,000 $ 2,500,000 $ 4,020,000 $ - R & R Subtotal $ 8,640,000 $ - $ 8,640,000 $ - Funding of Capital- Related Salaries $ - $ - $ - $ - TOTAL $ 23,325,000 $ (660,220) $ 22,664,780 $ 1,115,174 2012 Waterline Project $ 1,645,000 404,629 $ 2,049,629 $ 1,135,006 Elk Mountain Booster Surge Tank $ 100,000 (10,000) $ 90,000 $ - TOTAL $ 1,745,000 $ 394,629 $ 2,139,629 $ 1,135,006 GRAND TOTAL $ 25,070,000 $ (265,591) $ 24,804,409 $ 2,250,180 Total Project Over /(Under) Actual Project Expenditures Projects Completed in FY 13/14 Budget Through (13/14) Budget Total 6/30/2013 2012 Waterline Project $ 1,645,000 404,629 $ 2,049,629 $ 1,135,006 Elk Mountain Booster Surge Tank $ 100,000 (10,000) $ 90,000 $ - TOTAL $ 1,745,000 $ 394,629 $ 2,139,629 $ 1,135,006 GRAND TOTAL $ 25,070,000 $ (265,591) $ 24,804,409 $ 2,250,180 = —IL ANNUAL OPERATING Capital Improvement Plan, Continued FY 14/15 FY 15/16 FY 16/17 FY 17/18 FY 18/19 5 Year Future Budget Budget Budget Budget Budget Projected 940,790 $ 235,197 $ - Budgets $ 100,000 $ - $ - $ - $ $ 100,000 $ 940,790 $ 235,197 $ - $ - $ - $ 1,175,987 $ 445,000 $ 800,000 $1,247,258 $ - $ - $ 2,492,258 $ 264,311 $ - $ - $ - $ $ 264,311 $ 25,000 $ - $ - $ - $ - $ 25,000 $ 2,500,000 $ 2,937,988 $ 300,000 $ - $ - $ 5,737,988 $ 325,000 $ - $ - $ - $ - $ 325,000 $ 660,000 $ 160,000 $ 1,500,000 $ 330,000 $ $ 2,650,000 $ 240,000 $ - $ - $ - $ - $ 240,000 $ 130,000 $ $ - $ - $ - $ 130,000 $ 100,000 $ $ - $ - $ - $ 100,000 $ 100,000 $ 700,000 $ 100,000 $ 530,000 $ - $ 1,430,000 $ - $ - $ - $ 1,520,000 $ 2,500,000 $ 4,020,000 $ 1,230,000 $ 860,000 $ 1,600,000 $ 2,380,000 $ 2,500,000 $ 8,570,000 $ 265,000 $ - $ - $ - $ - $ 265,000 F$ 6,095,101 $ 4,833,185 $ 3,147,258 $ 2,380,000 $ 2,500,000 $ 18,955,544 Capital Projects Summary Yorba Linda Blvd Booster Pump Station Project Total Project Budget. $1,898,000 Proposed FY 14/15 Budget: $100,000 The project consists of replacing the existing Palm Avenue Booster Pump Station with a three -pump 5,000 -gpm capacity new pump station at Gun Club Road and Yorba Linda Blvd. The project will make it possible to deliver more groundwater to the easterly portion of the District's service area. Construction of the new pump station began in FY12/13 and will be complete in FY 14/15. Projected costs in FY 13/14 and FY 14/15 are estimated to be $1,195,000 and $100,000, respectively. Well #21 Project Total Project Budget: $2,307,000 Proposed FY 14115 Budget: $940,000 Work began in FY 12/13 on plans for the drilling of the new well. In FY13/14, a test well was drilled to confirm the quantity and quality of water for the well. Thereafter, the well was drilled out and completed with a steel casing and pump- tested. Project costs in FY 13/14 and FY 14/15 are estimated to be $1,086,000 and $940,000, respectively. Work planned for FY 14/15 includes construction of wellhead facilities and a discharge pipeline. Well #22 Project Total Project Budget: $2,500, 000 Proposed FY 14115 Budget: $445,000 Reconnaissance field investigation and site evaluations started in FY 13/14. In FY14/15, a site is expected to be determined and the property acquired, at a budgeted cost of $445,000. Budgeted for FY15/16 is the drilling of the well and the preparation of plans for well equipping at an estimated cost of $800,000. Budgeted for FY 16/17 is construction of wellhead facilities and a discharge pipeline at an estimated cost of $1,247,000. Fairmont Pump Station Upgrade Project Total Project Budget: $6,300, 000 Proposed FY 14115 Budget: $2,500, 000 The project is the refurbishment and upgrading of the Fairmont Booster Station. The existing 37 -year old booster station will be demolished and its two booster pumps will be replaced by six, pumping to two different pressure zones. A new building will be constructed to house the pumps, as well as disinfection, electrical and back -up generation facilities. The project will also include refurbishment of elements of the Fairmont Reservoir. Planned for FY14/15 is completion of design plans and the beginning of construction at an estimated cost of $2.5 million. Construction will continue in FY 15/16 at an estimated cost of $2.9 million. Part of the cost of the improvements will be offset by developer - provided funding. = L ANNUAL OPERATING W Capital Projects Summary, Continued Lakeview Grade Separation Project Total Project Budget: $600, 000 Proposed FY 14115 Budget: $265, 000 The Orange County Transportation Authority (OCTA) is the lead agency for a planned Lakeview Avenue bridge over Orangethorpe Avenue and the adjacent BNSF Railroad tracks. As part of the project, it will be necessary to replace and relocate the District's water line currently in Lakeview Avenue through the project area. The District's share of the pipeline relocation will be $250,000. Construction of the pipeline relocation work is anticipated to begin mid -2014, with a mid -2015 completion for all utility relocations. OCTA's bridge construction will follow. Yorba Linda High School Park Pipeline Relocation Project Total Project Budget: $370,000 Proposed FY 14115 Budget: $325,000 The proposed Yorba Linda High School Park, within Placentia - Yorba Linda Unified School District's (PYLUSD) property located south of Yorba Linda High School, includes proposed grading with nearly 18 -feet of fill over our existing 39 -inch diameter Bryant Cross Feeder (BCF) pipeline. The BCF pipeline will be unable to support the additional fill, and must be relocated. Per the Pre - Annexation Agreement with PYLUSD, the District is responsible for design and construction costs for relocating approximately 530 lineal feet of the BCF pipeline, at an estimated cost of $370,000. This work is anticipated to start late summer 2014 and be completed by late 2014. Future Pipeline Replacement Project Total Project Budget: $2,690, 000 Proposed FY 14115 Budget: $660, 000 In accordance with the District's Asset Management Plan, the District is replacing older water pipelines as part of an ongoing program. Staff will design approximately 2,000 feet of the more critical pipeline replacement reaches during FY 14/15, with pipeline construction in late FY 14/15 to early FY15/16. Additional waterline replacement work +will be designed and installed during subsequent fiscal years. Deville Drive Waterline Extension Total Project Budget: $50, 000 Proposed FY 14115 Budget: $25,000 The District will design and install approximately 130 -feet of 6 -inch diameter pipeline in Deville Drive in accordance with a previous Agreement and payment made by a Deville Drive property owner. Staff completed the design in -house during FY 13/14. Installation is anticipated to be complete during FY 14/15. = L ANNUAL OPERATING W Capital Projects Summary, Continued Timber Ridge Booster Station Rehabilitation Total Project Budget: $250, 000 Proposed FY 14115 Budget: $240, 000 Timber Ridge Booster Station is undersized and needs additional emergency pumping capacity. Staff will evaluate the least cost method to install a new gas engine enclosed with a new building, or install a new electric generator and possibly upsizing one or more of the existing pumps. Richfield Campus Spoils Total Project Budget: $150,000 Proposed FY 14115 Budget: $130,000 The District will design and solicit bids for the installation of a small concrete containment area on District property that will accommodate excess spoils from District repair and installation work, thereby reducing cost of dumping fees. Construction is anticipated to be complete during FY 14/15. Lakeview Booster Piping Total Project Budget: $100,000 Proposed FY 14115 Budget: $100,000 The District will coordinate the installation of an isolation valve to allow for a direct water supply from the Highland Pump Station to the Lakeview Reservoir, while providing for a direct water supply from the Lakeview Reservoir to the Lakeview Booster Pump Station. This project will improve water quality. Construction is anticipated to be complete during FY 14/15. Future PRS Rehabilitation Total Project Budget: $1,430,000 Proposed FY 14115 Budget: $100,000 The District will solicit proposals for design and rehabilitation upgrades of the existing Pressure Reducing Stations (PRS) that require frequent maintenance, and do not meet current District standards. Design work will be completed during FY 14/15 and construction is anticipated to be complete during FY 15/16. 1� Vehicle Equipment and Capital Outlay (FY 2014/15) Department / Item Amount Board of Directors None Administration None Engineering None Finance Meter Reading (1) Handheld Meter Reading Units $ 6,000 Total Vehicle Equipment & Capital Outlay- Finance $ 6,000 Human Resources None k1 Administration Server Replacements (Virtual, Exchsrv, Secsrv, ISTSsrv, etc.) $ 41,000 Network Improvements $ 20,000 Disaster Recovery (Information Backup) $ 60,000 Information Systems Replace Obsolete PCs (15 years +) $ 10,000 SCADA Box Canyon PLC (Control System) Upgrade $ 16,000 Well -10 PLC (Control System) Upgrade $ 14,000 Well -12 PLC (Control System) Upgrade $ 10,000 Well -7 PLC (Control System) Upgrade $ 10,000 Total Vehicle Equipment & Capital Outlay- IT $ 181,000 1� Vehicle Equipment and Capital Outlay (FY 2014/15), Continued Department / Item Amount Operations Water Operations & Maint. (2) Pickup Trucks $ 58,000 Backhoe $ 90,000 Sewer Operations & Maint. Sevver Vacuum /Jetter Truck $ 400,000 1 Ton Truck with Service Body $ 72,000 Water Production Lakeview Reservoir Pump Replacement $ 20,000 Mechanics Portable Emissions Analyzer $ 14,000 Facilities Maintenance Richfield Gate Repairs $ 55,000 Warehouse Reconfiguration $ 25,000 Total Vehicle Equipment & Capital Outlay- Operations $ 734,000 TOTAL VEHICLE EQUIPMENT & CAPITAL OUTLAY $ 921,000 Reconciliation by Fund Water Fund $ 449,000 Sewer Fund $ 472,000 TOTAL $ 921,000 VLM ANNUAL OPERATING BUDGET FISCAL' Department Summaries VLM ANNUAL OPERATING BUDGET FISCAL' Board of Directors = L ANNUAL OPERATING W Board of Directors The Board of Directors has oversight over Yorba Linda Water District and hires the General Manager to handle day -to -day operations. The directors have the power to set water and sewer rates, establish ordinances and policies, and to approve the maintenance and construction of necessary infrastructure repairs and replacement. The Board President also appoints directors to represent the District on key external agencies and commissions in the region. This Department accounts for the Board of Director's activities related to governing the District, establishing policy through approval of the Budget, Five Year Plan, Resolutions and Ordinances, and participating in community affairs, intergovernmental relations and participation at selected water and wastewater activities. In addition, the Board hires and provides direction to legal counsel and legislative advocacy consultants regarding activities related to policies and overall goals of the Board for the District. Strategic Plan Objectives /Goals Objectives derived from the Strategic Plan (pg. 19 -29) and specific to the Board of Directors are detailed in the following chart. Objective Attend more local and regional events and intergovernmental meetings CP 1 -C Provide financial incentives and rebates for water -use efficiency CP 2 -A Enhance the District's regional water and wastewater industry participation CP 2 -D Maintain commitment to strong debt services ratio FR 1 -E Implement an approach to ensure reserves are responsibly funded FR 2 -C Evaluate equitable rate structures that promote conservation and efficiency FR 4 -113 ':y_. .ANNUAL OPERATING G BUDGET FISCAL. YEAR 2014/2015 W Performance Measures The District will track the success in fulfilling some of its performance measures through the following benchmark: • Increase District attendance at industry events, intergovernmental meetings and community events - Tracking how many events were attended for FY 13/14, as compared to previous years. 500 400 300 200 100 0 Events Attended 516 FY 2009/10 FY 2010111 FY 2011/12 FY 2012/13 FY 2013/14 Accomplishments FY 2013/14 • Focused on enhancing agency efficiency by conducting the Organizational Assessment and Efficiency Study. • Broadened the reach of the District's Presence in the Wastewater Industry by opting to join California Association of Sanitation Agencies (CASA). • Further enhanced the overall reliability and economic stability of the District by shepherding an Annexation agreement with Orange County Water District. 0 r-1 Board of Directors Budget Expenses (Operating) Salary Related Expenses Salaries - Directors Fringe Benefits Mandatory Benefits - Directors Total Salary Related Expenses Supplies & Services Contractual Services Dues & Memberships Board Election Expenses Professional Services Professional Development Travel & Conferences Supplies & Services Sub -Total 1� FY 2013/14 FY 2014/15 Budget Budget $ 90,000 $ 90,000 $ 50,877 $ 52,442 $ 8,400 $ 8,533 $ 149,277 $ 150,975 $ 1,500 $ 1,500 $ 5,400 $ 13,400 $ - $ 75,000 $ 102,000 $ 90,000 $ 4,100 $ 4,100 $ 11,400 $ 9,400 $ 124,400 $ 193,400 qt Board of Directors Supplies & Services Budget (FY 2014/15) Primary GL Category 1-1010-0600-00 Contractual Services tegory Total $1,500 Sub Acct No./Sub Category I 1- 1010 - 0600 -00 Contractual Services Sub Acct I Total 1,500 Detail Item Description Tablet PC Data Service ($25 x 5) Detail Amt 1,500 1- 1010 - 0640 -00 Dues, Memberships, Subscriptions $13,400 1- 1010 - 0640 -00 Dues, Memberships, Subscriptions 13,400 WACO 200 CSDA 6,000 Colorado River Water Users Assoc 100 CASA 4,500 Water Ed Foundation 2,500 ISDOC 100 1- 1010 - 0650 -00 Board Election Expenses $75,000 1- 1010 - 0650 -10 Elections 75,000 Board Elections (3 seats) 75,000 1- 1010 - 0780 -00 Professional Services $90,000 1- 1010 - 0780 -00 Professional Services 90,000 LegalServices - Retainer 30,000 Legislative Consultants 60,000 1- 1010 - 0810 -00 Training $4,100 1- 1010 - 0810 -00 Training 4,100 CSDASpecial District Leadership AcademyTraining 4,100 1- 1010 - 0830 -00 Travel & Conferences $9,400 1- 1010 - 0830 -00 Travel & Conferences 9,400 Other Conferences 1,200 CRWUA (2 attendees at $1,000 each) 2,000 CSDA (2 attendees at $1,500 each) 3,000 ACWA (Spring- 2 @ $1,000, Fall -2 @ $500) 3,000 ISDOC Quarterly 200 Section Total $193,400 Supplies & Services Summary by Department Division Operations Information Technology Human Resources FY 2014/15 Board of Directors Administration Finance Engineering VLM ANNUAL OPERATING BUDGET FISCAL' VLM ANNUAL OPERATING BUDGET FISCAL' Administration Department Organization Chart Administration Department ®Yorba Linda Water District Organization Chart FY 2014/15 lob Classification Legend Management Part -Time Supervisory /Confidential Ba alning Unit = —LM ANNUAL OPERATING W Administration The Administration Department is responsible for the overall day -to -day management of the District. This involves the continual planning, control, direction and evaluation of the District's programs and resources. The Department researches and prepares recommendations for consideration by the Board of Directors on issues facing the District. Vested in this Department is the primary responsibility for assuring that Board policies, resolutions and ordinances are properly administered. Division Responsibilities GENERAL MANAGER The Administration Department, through the General Manager and the Executive Secretary, provides staffing, scheduling, and other support to the Board of Directors. The office posts and disseminates meeting notices, agendas, minutes, sets board meeting dates, and assists in conducting board and committee meetings. The Department provides administrative services support to each of the departments. Other department activities include interagency coordination and consultation with department managers regarding various operational and planning issues. Additionally, the department is responsible for facilitating the work of the District's General Counsel. PUBLIC AFFAIRS This division of the Administration Department is responsible for the management of all external and internal communications activities and intergovernmental relations. The Public Affairs Officer directs public and media relations, legislative affairs, and provides liaison with local elected officials and community groups. The Public Affairs Office oversees the production and distribution of publications and notices to inform the public of District functions, policies, and services. This division coordinates assigned activities with other District departments and outside agencies, and provides highly responsible and complex administrative support for the District, General Manager and Board of Directors. The office also coordinates special events and District participation in water education and community events. This includes water conservation activities, and organizing and conducting tours of District facilities for students, youth groups, and the general public. Strategic Plan Objectives /Goals Objectives derived from the Strategic Plan (pg.19 -29) and specific to the Board of Directors are detailed in the following chart. Objective ., Support Regional Training and Multi- Agency Workgroups through the CP -I 'oint use of the Administration Building Consider participation in the California Urban Water Conservation CP -2 Council's Best Management Practices Research and obtain grant funding whenever feasible CP -2 Continue with efforts to annex district service area to Orange County CP -2 Water District Engage with regional agencies on water supply issues CPA Evaluate the feasibility of providing additional water services within the SR -2 region Evaluate the feasibility of providing additional wastewater services within SR -2 the region Evaluate the feasibility of providing other professional services within the SR -2 region Continue to support additional training for staff WEA Encourage staff participation in professional organizations & local civic WEA groups Implement a program to recognize employees for excellence WE -3 Conduct quarterly All -Hands meetings WE -3 Continue to encourage employee training in Leadership and Technology WEA Develop a Public & Governmental Affairs Division CP -1 Develop a Public Relations Master Plan CP -2 Effectively Use Broad - Spectrum Communication Opportunities OE -1 Develop and Expand a Youth - Education Program CP -2 Update the District's Website CP -2 Performance Measures =0 The District will track the success in fulfilling some of its performance measurements through the following benchmarks: • Effective Use of Communication Opportunities- Tracking number of media inquiries, requests for materials, request for presentations, etc. 90 80 70 60 50 40 30 20 10 0 Public Outreach Events FY 2009/10 FY 2010/11 FY 2011/12 FY 2012/13 FY 2013/14 • Bi- Annual All -Hands Meetings Held- Tracking if an All -Hands meeting was held and on what schedule, as compared to a goal of two per year. All -Hands Meetings Held 4 3 3 2 2 2 1 0 FY 2009/10 FY 2010/11 FY 2011/12 FY 2012/13 FY 2013/14 Goal +Actual Accomplishments Fiscal Year 2013/14 In addition to managing various media inquiries and public information requests and continuously cultivating intergovernmental and community relationships, the Public Affairs Division: • Updated and enhanced the overall reach of the MWDOC /Discovery Science Center water education program. • New signage was designed and now adorns the Boardroom and Lobby. • Created the District's new Informational Brochure Our Commitment to Public Service for the District Representatives to refer to and to distribute to the community at events. • Orchestrated the Freeway Complex Fire Five Year Anniversary Town Hall Meeting. • Began planning for the production of a History of YLWD Video. • Doubled the overall reach of the District's Bottled Water Program. rba Linda • —r Di-`rict �r �,S�D91V� i l = L ANNUAL OPERATIIQG W Administration Personnel Summary Department FY 2010/11 FY 2011 /12 FY 2012/13 FY 2013/14 Proposed FY 2014/15 Administration 0.5 0.5 0.5 General Manager 1.0 1.0 1.0 1.0 1.0 Asst. General Manager 0.5 - - - - Executive Secretary 1.0 1.0 1.0 1.0 1.0 Management Analyst 1.0 - - 1.0 1.0 Records Management Clerk # - - - 0.5 - Records Management Specialist # - - - - 1.0 5.0 3.5 2.0 2.0 3.5 4.0 Public Affairs Legislative Affairs Intern Public Affairs Intern Public Affairs Specialist Management Analyst Public Information Officer Department Totals 0.5 0.5 0.5 - - 0.5 0.5 0.5 0.5 - - - - - 0.5 - 1.0 1.0 - - 1.0 1.0 1.0 1.0 1.0 2.0 3.0 3.0 1.5 1.5 5.5 5.0 5.0 5.0 5.5 'Positions added during Fiscal Year 2010/11 mid -year budget adjustment # Legislative Affairs Intern replaced with Records Management Clerk position 44 Administration Department Budget (FY 2014/15) Supplies & Services Communications $ FY 2013/14 $ FY 2014/15 Contractual Services $ Budget $ Budget Expenses (Operating) $ 55,560 $ 52,960 Salary Related Expenses $ 225 $ - Salaries $ 459,123 $ 553,406 Fringe Benefits $ 94,253 $ 101,580 Overtime $ - $ - Mandatory Benefits $ 51,883 $ 62,824 Total Salary Related Expenses $ 605,259 $ 717,810 Supplies & Services Communications $ 192,500 $ 189,994 Contractual Services $ 7,400 $ 7,400 Dues & Memberships $ 55,560 $ 52,960 Fees & Permits $ 225 $ - Insurance $ 1,240 $ 1,240 District Activities & Events $ 4,650 $ 4,650 Non - Capital Equipment $ 3,400 $ - Office Expense $ 250 $ 250 Professional Services $ 499,350 $ 405,750 Professional Development $ 8,350 $ 3,350 Travel & Conferences $ 12,000 $ 9,500 Supplies & Services Sub -Total $ 784,925 $ 675,096 Administration Budget Division Detail (FY 2014/15) Administration Division Primary GL Category 1-2010-0580-00 Communications Category Total $250 Sub Acct No./Sub Category I 1- 2010 - 0580 -10 Postage Sub Acct I Total 250 Detail Item Description I Postage Detail Amt I 250 1- 2010 - 0640 -00 Dues, Memberships, & Subscriptions $50,060 1- 2010- 0640 -00 Dues, Memberships, Subscriptions 50,060 Misc. 1,000 Notary Assoc Membership 60 ACWA 19,000 LAFCO 30,000 1- 2010 - 0690 -00 Insurance $1,240 1- 2010 - 0690 -00 Insurance 1,240 Notary Insurance (AA) 40 Honesty Bond (SC & AA) 1,200 1- 2010 - 0715 -00 District Activities and Events $4,050 1 -2010- 0715 -50 MeetingSupplies 4,050 MeetingSupplies 1,200 All Hands Meetings 2,500 Interagency Meetings 350 1- 2010 - 0760 -00 Office Expense $250 1- 2010- 0760 -00 Office Expense 250 Office Supplies 250 1- 2010 - 0780 -00 Professional Services $405,750 1- 2010 - 0780 -00 Professional Services 25,000 District Succession Plan 25,000 1- 2010 - 0780 -05 Legal Services 180,000 Routine Legal 180,000 1- 2010 - 0780 -15 Records Management 750 Records Retention Schedule Update 250 Records Destruction 500 1- 2010 - 0780 -36 Water Only Related Expenses 200,000 Freeway Complex Fire Legal Services 200,000 1- 2010 - 0810 -00 Professional Development $850 1- 2010 - 0810 -00 Professional Development 850 CSDA District ofDistinction GM Training 850 1- 2010 - 0830 -00 Travel & Conferences $2,000 1- 2010- 0830 -00 Travel & Conferences 2,000 ACWA (1 attendees) 1,000 Laserfische Conference (1 attendee) 1,000 Section Total $464,450 Administration Budget Division Detail (FY 2014/15) Public Affairs Division 'iatail It- Ilaarrintinn r 1- 2020 - 0580 -00 Communications $189,744 1- 2020 -0580 -05 Advertising 6,000 General 6,000 1- 2020 -0580 -10 Postage 17,000 Postage 17,000 1- 2020 - 0580 -15 District Special Events 20,000 Community Events (Open House, Facility Tours, etc.) 20,000 1- 2020 -0580 -35 Promotional Items 65,000 YLWD Bottled Water 45,000 Promotional Items 20,000 1 -2020- 0580 -40 Sponsorships 2,000 Sponsorship- OCWater Summit 2,000 1- 2020 - 0580 -45 Video Productions 29,000 PSA/VideoProduction /Web Maintenance 17,500 History Wall 11,500 1- 2020 -0580 -50 Water Conservation Materials 21,600 Fall Newsletter 5,400 Winter Newsletter 5,400 Spring Newsletter 5,400 Summer Newsletter 5,400 1- 2020 - 0580 -55 Water Conservation Programs 29,144 MWDOC Choice Water Use Efficiency 29,144 1- 2020 - 0600 -00 Contractual Services $7,400 1- 2020 - 0600 -00 Contractual Services 7,400 Doxo 1,620 Muzak Contract 780 Conservation Rebate Prog. (Turf, Sprinklers, etc.) 5,000 1- 2020 - 0640 -00 Dues, Memberships, & Subscriptions $2,900 1- 2020 -0640 -00 Dues, Memberships, & Subscriptions 2,900 OC Register /LATimes 500 Chamber Memberships (YL, PL) 1,000 CAPIO Membership 600 PRSAMembership 800 1- 2020 - 0715 -00 District Activities& Events $600 1- 2020 - 0715 -50 Meeting5upplies 600 Intergovernmental Meetings 350 Division Meetings 250 1- 2020 - 0810 -00 Professional Development $2,500 1- 2020 - 0810 -00 Professional Development 2,500 Training 2,500 1- 2020 - 0830 -00 Travel & Conferences $7,500 1- 2020 - 0830 -00 Travel & Conferences 7,500 CAPIO Annual Conference (1 employee) 1,400 PRSAAnnual Best Practices Summit (1 employee) 2,600 CRWUA(1 employee) 1,000 Mileage 2,500 Section Total $210,644 0 Supplies & Services Summary by Department Division Operations Information Technology Human Resources i FY 2014/15 Administration Department Board of Directors ------------- � Adrninistration Finance Engineering Public Affairs q 4 VLM ANNUAL OPERATING BUDGET FISCAL` think big teamwork newl imagination ■ ■ riskinspiring creative business communication solution key' performance planning works inn v ideaSconcept brand b rain sto rm plan strategysuccess g1oba1 process 0Utoftheboz ``reward leadershi efficient workflow informationmarketingbest organization networksocial research analysis green advertising Positivevision refresh ads development goals VLM ANNUAL OPERATING BUDGET FISCAL' Engineering Department Organization Chart Engineering Department Construction Sr. Project Water Oualiri Project Manager Engineer Supervisor Sr. Construction WO Technician II Inspector Eng. Technician Associate Eng. Technician 11 Engineer 11 Construction Inspector Yorba Linda Water District Organization Chart FY 2014/15 Job Classification Legend Management I Supervisory/Confidential I Bargaining Unit Engineering The Engineering Department, under the general direction of the Engineering Manager, provides the following support services: Planning, Design and Construction Management of Capital Improvement Projects, Water Quality Regulatory Compliance and Cross - Connection Prevention Programs, and Engineering Record Management of District facilities. The Department is responsible for strategic planning, capital budget, water resources planning, environmental services, quality control, construction for capital improvements and replacement projects, inspecting system improvements, and managing the water quality testing and compliance programs. 2012 Pipeline Replacement Project Division Responsibilities ENGINEERING ADMINISTRATION This division provides overall departmental administration and planning for capital projects, divisional work and water - quality testing. Also included is records management to maintain files on facilities and new water and sewer construction projects, accomplish as -built documentation, and respond to underground service alert requests. = L V kv Q_ ANNUAL OPERATING)�nl b. W PLANNING AND DESIGN This division is responsible for planning and oversight of water and sewer facilities proposed by developers to assure that they are planned and designed to District standards, and sized to meet the long -range plans of the District. The division has similar responsibilities for District planned and funded facilities, including confirmation that environmental documentation and requirements are met. The division provides management and review of the design of District facilities, with the design performed internally or by outside engineering consultants retained by the District. CONSTRUCTION MANAGEMENT This division is responsible for construction management of all District capital projects and developer - related construction projects. The division has inspection staff or retains outside inspection staff as required to oversee construction of water and sewer facilities to assure they are meeting design intent and the standards of the District. WATER QUALITY This division is responsible for implementing, maintaining, and complying with all local, state and federal water quality regulation programs including monitoring, analysis, and documentation of water quality testing. In addition, the division monitors all backflow devices and fire detector -check assemblies within the District service area for the cross - connection prevention program as required by the California Department of Public Health. Strategic Plan Objectives /Goals Objectives derived from the Strategic Plan (pg. 19 -29) and specific to the Board of Directors are detailed in the following chart. Analyze the Asset Management Plan to Determine Future Needs SR -1 Develop Additional Well Sites SR -1 Continue Implementation of Three -Year Capital Improvement Plan SR -3 Continue Planning for Long -Term Capital Improvements and SR -1 Replacements y: LM ANNUAL OPERATING 1%61 Performance Measures • In conformance with the requirements of the State Department of Public Health, District staff collects water samples from the distribution system, including wells and reservoirs throughout the service area on a weekly basis for water quality testing. Based on the size of the District and the number of customers, the District is required to collect 18 samples per week. The District routinely collects 37 samples per week, more than twice the number required. Additionally, the District also collects and analyzes for over 1,400 other chemical, bacteriological and mineral constituents on an annual basis to assure the water delivered is safe and meets or exceeds all standards of the Department of Public Health. In the last three years, District staff collected 4,005, 3,980 and 3,980 samples, respectively, for testing. • District Engineering staff manage multiple water and sewer projects each year, some of which may be short -term small improvements, such as new water and sewer service connections for new or improved single -lot developments, or long- term larger improvements, such as water and sewer main facilities and appurtenances for new housing and commercial developments, or new capital facilities, such as pump stations and transmission mains, to improve water or sewer service. Each project is set up, files established, monitored and tracked throughout its planning, construction and startup. When complete, all documentation is compiled and the files are closed. In the last three years, District staff completed and closed 26, 15 and 11 jobs, respectively. The decline in job closings is a reflection of the downturn in the economy in this time period. • As part of the District's responsibility to monitor all water system backflow protection devices, and help safeguard public health, Engineering staff provide oversight for the testing and reporting of these devices. As necessary, District staff send notices to property owners (businesses and residential) of the need for the annual test as required by the State. Depending on the response of the property owners, staff will send First and Second Notices of testing required to customers to assure their devices are tested regularly on schedule for compliance. In 2010, 2011 and 2012, District staff provided oversight for the testing of 2,903; 2,948 and 3,048 backflow devices, respectively. Oversight included monitoring for devices that did not comply with test requirements and required repair or replacement, totaling 184, 161 and 133 devices over the last three years. Accomplishments Fiscal Year 2013/14 r,\ • Construction of Yorba Linda Blvd Booster Station • Construction of 2012 Pipeline Replacement Project, Phase 2 • Initiated construction of Y. L. High School Park Pipeline Relocation Project • Initiated construction of Elk Mountain BPS Surge Tank Replacement Project • Completed drilling of Well 21 • Initiated design of Wellhead Facilities and Pipeline for Well 21 • Initiated design of Fairmont Booster Station Upgrade Project • Completed process for annexation to Orange County Water District i Ilk Well #21 Drilling Construction = � ANNUAL OPERATING W Engineering Personnel Summary Department FY 2010/11 FY 2011 /12 FY 2012/13 FY 2013/14 Proposed FY 2014/15 Administration - 1.0 - 1.0 1.0 Engineering Manager 1.0 1.0 1.0 1.0 1.0 Engineering Secretary 1.0 1.0 1.0 1.0 - 4.0 2.0 2.0 2.0 2.0 1.0 Planning & Design Associate Engineer Engineering Technician II Project Coordinator Project Engineer Sr. Project Manager Construction Construction Inspector Construction Project Supervisor Project Engineer Sr. Construction Inspector Water Quality Water Quality Engineer Water Quality Technician II* Department Totals 1.0 3.0 2.0 2.0 2.0 2.0 - - - 1.0 - 1.0 1.0 1.0 - - 1.0 1.0 1.0 1.0 1.0 7.0 6.0 6.0 4.0 4.0 1.0 1.0 1.0 1.0 1.0 - - - 1.0 1.0 1.0 1.0 1.0 - - 1.0 1.0 1.0 1.0 1.0 3.0 3.0 3.0 3.0 3.0 1.0 1.0 1.0 1.0 1.0 1.0 1.0 1.0 1.0 1.0 2.0 2.0 2.0 2.0 2.0 14.0 13.0 13.0 11.0 10.0 " under filled with Water Quality Technician I prior to FY 2013/14 1� Engineering Department Budget (FY 2014/15) Supplies & Services Contractual Services $ FY 2013/14 $ FY 2014/15 Dues & Memberships $ Budget $ Budget Expenses (Operating) $ 27,875 $ 28,050 Salary Related Expenses $ 2,000 $ 2,000 Salaries $ 919,677 $ 928,221 Fringe Benefits $ 146,044 $ 123,662 Overtime $ 2,200 $ 2,200 Mandatory Benefits $ 120,547 $ 124,485 Total Salary Related Expenses $ 1,188,468 $ 1,178,568 Supplies & Services Contractual Services $ 111,380 $ 96,160 Dues & Memberships $ 3,063 $ 2,963 Fees & Permits $ 27,875 $ 28,050 Materials $ 2,000 $ 2,000 Non - Capital Equipment $ 1,400 $ 5,000 Office Expense $ 2,450 $ 2,950 Professional Services $ 20,000 $ 26,000 Professional Development $ 2,950 $ 3,850 Travel & Conferences $ 3,300 $ 3,300 Supplies & Services Sub -Total $ 174,418 $ 170,273 Engineering Budget Division Detail (FY 2014/15) Administration Division Primary GIL Category Category I Sub Acct No./Sub Category I Sub Acct I Detail Item Description I Detail Amt I To 1-4010-0640-00 $300 1- 4010 -0640 -00 Total 300 Dues, Memberships & Subscriptions 300 Dues, Memberships, & Dues, Memberships, Subscriptions Subscriptions 1- 4010 -0810 -00 $200 1- 4010 - 0810 -00 200 Training 200 Professional Development Training 1 -0010- 0830 -00 $800 1- 4010 - 0830 -00 800 Travel & Conferences 800 Travel & Conferences Travel and Conferences Section Total $1,300 Engineering Budget Division Detail (FY2014/15) Planning & Design Division Primary GIL Category Category Sub Acct No./Sub Category I Sub Acct I Detail Item Description I Detail Amt I To 1-4020-0600-00 $35,000 1- 4020 -0600 -00 Total 35,000 The Chambers Group (Hidden Hills) 35,000 Contractual Services Contractual Services 1- 4020 -0645 -00 $6,050 1 -4020- 0645 -00 4,050 OCWD /Well 21 Lease Agreement Fee 4,050 Fees& Permits Fees & Permits 1 -4020- 0645 -20 2,000 USA Underground Service Alerts 2,000 USA Underground Service 1- 4020 - 0640 -00 $500 1- 4020 - 0640 -00 500 AWWA 250 Dues, Memberships, & Dues, Memberships, & ASCE 250 Subscriptions Subscriptions 1 -0020 -0760 -00 $1,800 1- 4020 - 0760 -00 1,500 Office Expense 1,500 Office Expense Office Expense 1- 4020 - 0760 -30 300 Library Reference Books 300 Books & Publications 1 -0020 -0780 -00 $26,000 1- 4020 - 0780 -00 3,000 Cathodic Protection Consulting Services 3,000 Professional Services Professional Services 1- 4020 - 0780 -36 15,000 Water Consulting Services 15,000 ProfessionalServiices -Water 1- 4020 - 0780 -39 8,000 Sewer Consulting Services 8,000 Professional Services -Sewer 1 -4020- 0810 -00 $1,000 1- 4020 - 0810 -00 1,000 AWWA 500 Professional Development Professional Development Certification Courses 500 1 -0020- 0830 -00 $500 1- 4020- 0830 -00 500 Cathodic Protection 500 Travel & Conferences Travel & Conferences Section Total $70,850 Engineering Budget Division Detail (FY 2014/15) Construction Division Primary GIL Category Category Sub Acct No./Sub Category 1 -4030- 0640 -00 $500 14030 -0640 -00 Dues, Memberships, & Dues, Memberships, & Subscriptions Subscriptions Sub Acct 500 Detail Description Construction Management Association ofAmerica Detail 350 Ain WA 150 1 -4030- 0750 -00 Non - Capital Equipment $5,000 1- 4030 - 0750 -00 Non - Capital Equipment 5,000 Inspection Related Tools & Equipment 1,400 Locator 3,600 1 -4030- 0760 -00 Office Expense $850 1 -4030- 0760 -00 Office Expense 350 Office Supplies 350 1 -4030- 0760 -30 Books & Publications 500 Code Books 500 1 -4030- 0810 -00 Professional Development $1,800 1 -4030- 0810 -00 Professional Development 1,800 Inspector Certification 1,200 Training 600 Section Total $$,150 Engineering Budget Division Detail (FY 2014/15) Water Quality Division Primary GIL Category I Category L --- Sub Acct No./Sub Category I Sub Ac t I Detail Item Description Detail Amt. 1-4040-0600-00 $61,160 1-4040 -0600 -00 Totalc 3,000 System Disinfection /Blending 3,000 Contractual Services Contractual Services 1- 4040 - 0600 -12 350 Backflow Device Repair 350 Backflow Device Rep 1- 4040 - 0600 -25 5,590 Distribution System Disinfection 5,590 Distrubution System 1- 4040 -0600 -50 220 220 Uniforms 1 -0040 -0600 -60 52,000 Microbiological Examination 52,000 Microbiological Examination 1- 4040 -0640 -00 $1,663 1- 4040 -0640 -00 1,663 American Academy of Environmental Engineers 100 Dues, Memberships, & Dues, Memberships, & ABPA (Maldonado) 100 Subscriptions Subscriptions Water Purveyor Membership 1,000 American Society of Civil Engineers (Nguyen) 225 AW WA (Nguyen) 238 1 -4040- 0645 -00 $22,000 1- 4040 -0645 -10 22,000 Dept. of Health Services 22,000 Fees& Permits Dept of Health Services 1 -0040 -0710 -00 $2,000 1 -0040- 0710 -20 2,000 Wtr QualityTest Reagents 2,000 Materials Wtr Quality Test Kit Reagents 1 -0040 -0760 -00 $300 1- 4040 - 0760 -30 300 AWWABooks 300 Office Expense Books & Publications 1 -4040- 0810 -00 $850 1- 4040- 0810 -00 850 Training 850 Professional Development Professional Development 1- 4040 -0830 -00 $2,000 1 -4040- 0830 -00 2,000 Travel and Conferences 2,000 Travel& Conferences Travel and Conferences Section Total $89,973 Information Nb Supplies & Services Summary by Department Division FY 2014/15 Engineering Department Operations Water quality 44 Planning & Design VLM ANNUAL OPERATING BUDGET FISCAL' Yorba Linda Booster Pump Station Project VLM ANNUAL OPERATING BUDGET FISCAL' Finance All Department Organization Chart Finance Department Meter Reader (I ON- ®Yorba Linda Water District Organization Chart lob aasslfkatioe 1pa W FY 2014/15 Management I Supervisory/Confident ial B r ainin Uni[ = L ANNUAL OPERATING W Finance The Finance Department maintains the financial oversight of all District funds by ensuring conformance with modern finance and accounting theory, practices and compliance with applicable state and federal laws. Finance provides external and internal services throughout the District and its service area. Because of our dedication to provide the highest level of service possible, we continually seek to implement solutions that utilize the most current technology and tools available. The department provides a wide level of service in the following areas: Administration, Accounting, Customer Service, and Meter Reading sections. Division Responsibilities ADMINISTRATION This Division of the Department is responsible for the establishment and maintenance of an effective financial accounting and utility billing system, which accurately accounts for the operations of the District and offers a framework for planning and analysis. ACCOUNTING The Accounting Division is responsible for all financial related services for the District, which include general ledger accounting, audit, the processing of accounts payable and payroll, banking and cash management, investment functions, job costing, cost accounting, fixed assets, monthly, quarterly and annual budget preparation, and Capital Improvement Program reporting. This section is also responsible for completing the District's annual financial audit and publishing the Comprehensive Annual Financial Report (CAFR). Accounting annually reviews the District's Investment Policy and assists in the preparation of the District's annual operating and capital budgets. All duties are performed according to generally accepted accounting practices and procedures. CUSTOMER SERVICE /BILLLING The Customer Service Division is the first point of contact for our customers, especially for the investigation and resolving of customer questions and concerns on a wide variety of service related issues. This section provides reception services, call center activity, walk -up counter payment service, internet payment service, ACH and credit card payment processing, customer billing, new account processing, work order generation, and delinquent account processing, including collection processing and referrals. This section is also responsible for all accounts receivable activities, which includes the generation of invoices and the posting of payments. = —Lo ANNUAL OPERATING W METER READING The Meter Reading Division reads approximately 24,000 meters a month using manual and automatic meter reading technology. This section also handles all field service requests that include turning on /off accounts, meter repairs, water consumption investigations and consultations, and meter calibrations. Strategic Plan Objectives /Goals Objectives derived from the Strategic Plan (pg. 19 -29) and specific to the Board of Directors are detailed in the following chart. Objective SP Goal Review current Comprehensive Multi -Year Financial Plan and modify as FRA needed. Prepare a high -level annual Budget Document and Annual Financial FRA Report and compete for recognition by the Government Finance Officers Association and by the California Society of Municipal Finance Officers. Adhere to the current Water Rules and Regulations and FR -4 Service /Developer Fees approved March 2012. Revise the Sewer Rules and Regulations Fees. Evaluate fees regularly for proper cost of service coverage. Research alternative investment methods to achieve the highest rate of FR -3 return while balancing the tolerable risk of investments. Review current workflow processes and practices in an effort to OE -1 streamline and /or automate to increase efficiencies. Continue to record and report the fairly stated financial activities of the FRA District in a timely and transparent manner to the Board and member agencies. Continue to improve communications of the District's financial information FRA to the Board, member agencies, management, and the financial community. Work in coordination with IT to implement a district wide paperless OE -1 processing system. Continue to provide Finance staff with cross - training opportunities. WEA Manage District Cash Flow to Maximize Investment Income FR -3 Record and report accurate financial obligations payable from the FRA Districts operating and capital funds /reserves Performance Measures 7,000,000 6,000,000 5,000,000 4,000,000 3,000,000 2,000,000 1,000,000 0 FYE 2014 Reserves Water Sewer Water Sewer Maintenance Employee Water Debt COP Bond Water Capital Sewer Capital Operating Operating Emergency Emergency Reserve Reserve Service 2008- Reserve Replacement Replacement w Estimated June 30, 2014 Balance Minimum Reserve Target Note: Water Capital Replacement and Sewer Capital Replacement reflect annual contribution amounts, not target balances. 3 2.5 2 1.5 1 0.5 0 Debt Service Ratio FY 09 -10 FY 10 -11 FY 11 -12 FY 12 -13 FY 13 -14 FY 14 -15 +Debt Ratio —0— Requirement Note: FY 08/09, FY 09/10, FY 10/11, and FY 11/12 are actual. FY 12/13 is projected and FY 13/14 is forecasted. 9000 8000 7000 6000 5000 4000 3000 2000 1000 0 Total Online Customers )n -line Customers by Category and Year I LId I Auto Pay One Time Paperless Billing ■ FY 2009/10 ■ FY 2010/11 ❑ FY 2011/12 ■ FY 2012/13 Accomplishments Fiscal Year 2013/14 j - 11 Paper Bill • Staff received Microsoft Office and Cogsdale training to enhance workflow efficiencies • Successfully modified the billing system and water bill templates to reflect new water and meter rates effective July 1, 2013 • Created multi - layered map for tracking meter replacement, stuck meters and other troubleshooting for the years 2011 to 2013. • Successfully activated 2,264 new customer accounts. • Successfully responded to 1,714 customer service requests for high bills, meter replacements and other services • Submitted and received a Distinguished Budget Presentation Award for FY 2013/14 from the Government Finance Officers Association for a third consecutive year VLW ANNUAL OPERATING BUDGET FISCAL' • Began operating test bench meter test bench for high bill complaints not resolved via the normal protocol and used to test rebuilt meters before they are returned to service (pictured). • Resequenced and divided the largest meter - reading route in the District (888 meters) into two separate routes, allowing both routes to be billed for efficiently. • Upgraded the Cogsdale Customer Service Management computer module to the newest version. • Implemented Customer Service Quick Pay computer module, allowing customers the option to make a one -time payment via the District website. • Successfully converted to a more user - friendly version of the Online Bill Payment system. • Streamlined and automated the Jumper /Meter installation tracking process. • Completed the District's FY 2012 -13 CAFR, receiving an unqualified opinion and the GFOA award for Excellence in Financial Reporting for the fourth consecutive year. Ell k- Finance Personnel Summary Proposed Department FY 2010/11 FY 2011 /12 FY 2012/13 FY 2013/14 FY 2014/15 Administration Finance Director 1.0 - - - - Finance Manager - 1.0 1.0 1.0 1.0 1.0 1.0 1.0 1.0 1.0 Accounting Accounting Assistant 1 1.0 1.0 1.0 1.0 1.0 Accounting Assistant II 1.0 1.0 1.0 1.0 1.0 Senior Accountant 1.0 1.0 1.0 1.0 1.0 Storekeeper 1.0 - - - - 4.0 3.0 3.0 3.0 3.0 Customer Service /Billing Customer Service Rep 1 1.0 1.0 1.0 1.0 - Customer Service Rep II 1.0 1.0 1.0 1.0 2.0 Customer Service Rep III 2.0 2.0 2.0 2.0 2.0 Customer Service Supervisor 1.0 1.0 1.0 1.0 1.0 5.0 5.0 5.0 5.0 5.0 Meter Reading Meter Reader 1 2.0 2.0 2.0 2.0 1.0 Meter Reader II 2.0 2.0 2.0 2.0 2.0 Meter Services Lead 1.0 1.0 1.0 1.0 1.0 Meter Services Rep. - - - - - 5.0 5.0 5.0 5.0 4.0 Department Totals 15.0 14.0 14.0 14.0 13.0 1� Finance Department Budget (FY 2014/15) FY 2013/14 FY 2014/15 Budget Budget Expenses (Operating) Salary Related Expenses Salaries $ 886,971 $ 843,820 Fringe Benefits $ 187,123 $ 162,275 Overtime $ 13,200 $ 6,200 Mandatory Benefits $ 110,671 $ 104,142 Total Salary Related Expenses $ 1,197,965 $ 1,116,437 Supplies & Services Communications $ 98,200 $ 101,400 Contractual Services $ 98,640 $ 101,870 Dues & Memberships $ 785 $ 785 Fees & Permits $ 101,365 $ 121,090 Insurance $ - $ 600 Materials $ 25,000 $ 25,000 District Activities & Events $ 1,050 $ 1,050 Maintenance $ 300 $ 300 Non - Capital Equipment $ 950 $ 950 Office Expense $ 14,050 $ 14,050 Professional Services $ 33,360 $ 27,660 Professional Development $ 3,160 $ 3,830 Travel & Conferences $ 5,300 $ 3,900 Uncollectible Accounts $ 25,000 $ 40,000 Supplies & Services Sub -Total $ 407,160 $ 442,485 Finance Budget Division Detail (FY 2014/15) Administration Division Primary GIL Category Sub Acct Total 1- 3010 -0600 -00 $400 1- 3010 - 0600 -00 400 Contractual Services Contractual Services Detail Description ,. Check signature plate 400 1- 3010 -0640 -00 Dues, Memberships, & Subscriptions $425 1- 3010 -0640 -00 Dues, Memberships, & Subscriptions 425 CSMFO 110 CMTA 155 GFOA 160 1- 3010 - 0690 -00 Insurance $600 1- 3010 - 0690 -00 Insurance 600 Honesty Bond 600 1- 3010 - 0715 -00 District Activities & Events $400 1- 3010 -0715 -50 Meeting5upplies 400 Meeting Supplies 400 1- 3010 -0780 -00 Professional Services $27,160 1- 3010 - 0780 -00 Professional Services 27,160 Auditors 18,960 Financial Plan Model Consulting 5,000 CAF R On l i n e 2,000 CDAR Preparation 1,200 1- 3010 -0810 -00 Professional Development $925 1- 3010 - 0810 -00 Professional Development 925 CMTASeminars 300 2014 Government Tax Update 325 CSMFO Workshops 300 1- 3010 -0830 -00 Travel& Conferences $1,500 1- 3010 - 0830 -00 Travel& Conferences 1,500 CaIPESAnnual Conference 500 CSMFO Conference 1,000 Section Total $31,4101 1 Finance Budget Division Detail (FY 2014/15) Accounting Division Primary GIL Category Category 1- 3020 -0580 -00 $400 Communications Sub Acct No./Sub Category Sub Acct 1- 3020 -0580 -00 400 Communications Detail Item Description Detail Publish Unclaimed List 400 1- 3020 - 0600 -00 Contractual Services $860 1- 3020 -0600 -00 Contractual Services 860 Green Shades 500 Doculivery 360 1- 3020 - 0640 -00 Dues, Memberships, & Subscriptions $110 1- 3020 - 0640 -00 Dues, Memberships, & Subscriptions 110 CSMFO 110 1- 3020 -0645 -00 Fees & Permits $34,090 1- 3020 - 0645 -00 Fees & Permits 915 CSMFO Budget Reviewer Fee 150 GFOA CAFR Reviewer Fee 435 GFOA Budget Award Reviewer Fee 330 1- 3020 - 0645 -50 Bank Service /Fees 33,175 Analysis Fees (Avg$2550 /mo) 33,000 Safe Deposit Box Fee 150 Annual Bankcard Fee 25 1- 3020 -0715 -00 District Activities and Events $400 1- 3020 - 0715 -50 Meeting Supplies 400 Meeting5upplies 400 1- 3020 -0730 -00 Maintenance $300 1- 3020 - 0730 -00 Maintenance 300 Small Office Equipment Maintenance 300 1- 3020 -0760 -00 Office Expense $12,500 1- 3020- 0760 -00 Office Expense 9,000 Office supplies 9,000 1- 3020 -0760 -10 Paper 3,500 Paper 3,500 1- 3020 -0810 -00 Professional Development $1,000 1- 3020 - 0810 -00 Professional Development 1,000 StaffTraining 1,000 1- 3020 -0830 -00 Travel & Conferences $1,500 1- 3020 - 0830 -00 Travel & Conferences 1,500 CSMFOConference 1,000 PIPERS Annual Conference 1 500 Section Total $51,160 Finance Budget Division Detail (FY 2014/15) Customer Service /Billing Division Primary GL Category 1- 3030 - 0580 -00 Communications Category Total $101,000 Sub Acct No./Sub Category 1- 3030 - 0580 -00 Communications Detail Item Description Sub Acct I Total 500 UPS /Fed Ex /Other Detail 500 1- 3030 - 0580 -10 Postage 5,500 Postage Metered 5,500 1- 3030 - 0580 -22 Postage - Infosend 95,000 Postage -Infosend 95,000 1- 3030 - 0600 -00 Contractual Services $97,450 1- 3030 - 0600 -00 Contractual Services 1,730 Post Office Box 250 Post Master - Lockbox 1,480 1- 3030 - 0600 -21 Customer Credit Check 5,600 Online - Credit Checks 5,000 Online - Utility Exchange 600 1- 3030 - 0600 -22 Pri nti ng of Bi Its - Infosend 78,620 Info Send E -Bill Fees 19,000 DOXO 1,620 MailingService 58,000 1- 3030 - 0600 -30 Warranties & Service 1,500 Meter & Scale Lease Agreement 1,500 1- 3030 - 0600 -55 Answering Service 10,000 Phone AnsweringService 10,000 1- 3030 - 0645 -00 Fees & Permits $87,000 1- 3030 - 0645 -50 Ba nk Services /Fees 87,000 Lock Box Services 32,000 Credit Ca rd & Auto Dr Processing 55,000 1- 3030 - 0715 -00 District Activities and Events $250 1- 3030 - 0715 -50 Meeting Supplies 250 MeetingSupplies 250 1- 3030 - 0760 -00 Office Expense $1,550 1- 3030 - 0760 -00 Office Expense 1,550 Postage Machine Supplies 250 Forms /Pads/Tags /Deposit Slips 1,300 1- 3030 - 0780 -00 Professional Services $500 1- 3030 - 0780 -09 Collection Services 500 Collection Agency Fee 500 1- 3030 - 0810 -00 Professional Development $1,245 1- 3030 - 0810 -00 Professional Development 1,245 Customer ServiceTraining (minof2classesPP) 1,245 1- 3030 - 0830 -00 Travel & Conferences $200 1- 3030 - 0830 -00 Travel & Conferences 200 Mileage 200 1- 3030 - 0850 -00 Uncollectible Accounts $40,000 1- 3030 - 0850 -00 Uncollectible Accounts 40,000 Uncollectible Accounts 40,000 Section Total $329,195 Finance Budget Division Detail (FY 2014/15) Meter Reading Division Primary GIL Category Category Sub Acct No./Sub Category I SubAcct I Detail Item Description Detail To 1- 3040- 0600 -00 $2,300 1- 3040- 0600 -00 Total 2,300 Neptune Maintenance Agreement 2,300 Contractual Services Contractual Services 1- 3040 - 0640 -00 $250 1- 3040 - 0640 -00 250 AWWA 250 Dues, Memberships, & Dues, Memberships, Subscriptions Subscriptions 1- 3040 -0710 -00 $23,000 1- 3040 - 0710 -58 23,000 Registers 23,000 Materials Registers 1- 3040 - 0750 -00 $800 1- 3040 - 0750 -00 800 Meter Shop Equipment 500 Non - Capital Equipment Non - Capital Equipment Construction Meter Locks 300 1- 3040 - 0810 -00 $860 1- 3040 - 0810 -00 700 Training classes 700 Professional Development Professional Development 1- 3040- 0810 -40 160 Certificate Reimbursement 160 Certificate Reimbursement 1- 3040 -0830 -00 $700 1- 3040 - 0830 -00 700 AWWAConference 700 Travel & Conferences Travel & Conferences Section Total $27,910 4 Supplies & Services Summary by Department Division FY 2014/15 Finance Department Operations BOD CS & Billing Information Technology Human Resources Admin Administration - -__, Accounting _Engineering Meter Reading VLM ANNUAL OPERATING BUDGET FISCAL' Human Resources ®Yorba Linda Water District Organization Chart FY 2014/15 Department Organization Chart Human Resources Department Job Classification Legend Management Part -Time y Supervisory /Confidential I Bat ainin Unit LM 2 ANNUAL OPERATING HUMAN RESOURCES Under the direction of the Human Resources & Risk Manager, the human resources function at the District has evolved from a custodian of personnel records and recruiting, to a strategic partner at the center of the organization. As such the Human Resources Department adopted the Department's slogan, Your Team Builder, in 2012. The Human Resources Department is responsible for the administration and coordination of the District's personnel system, risk management and safety programs. The Department works to ensure that the District gets the most out of its employees through the implementation of sound personnel policy and by providing professional development opportunities for employees. Division Responsibilities: HUMAN RESOURCES ADMINISTRATION This Division supports operating departments by providing a wide range of personnel services such as benefits administration (health, dental, optical, life insurance and an employee assistance program), coordinating recruitment and selection, classification and compensation programs, as well as the administration of the District's personnel rules, policies and procedures. Other functions include the maintenance of employee personnel files, training records, medical files and employee performance evaluation reports. This Section promotes employee development and the sharpening of employees' skills and knowledge through training programs, as well as providing career development opportunities. The Administration Section also provides employer /employee relations administration services and contract negotiations, which includes employee and supervisory counseling on personnel policies, procedures and practices, providing assistance in the handling of employee grievances and disciplinary actions as well as implementation of new labor contract provisions. RISK MANAGEMENT This Division administers the District's self- insured liability, worker's compensation and loss prevention programs. The District's liability, property and workers compensation insurance is provided by the Association of California Water Agencies Joint Powers Insurance Authority (ACWA- JPIA). The Risk Management Section strives to protect the personnel and physical assets of the District from injury and financial consequences of accidental losses through a program of prevention, avoidance and insurance procurement. The Section is responsible for cost - effective management of tort liability claims filed against the District. It strives to process and bring closure as expeditiously as possible to all claims and engages the input of other District departments during the investigation and resolution process. SAFETY The Safety Division actively looks to reduce the District's accidental loss exposure through continuous identification and measurement of existing hazards and through the implementation of policies and procedures to eliminate unsafe working conditions. Other functions include the coordination and implementation of safety and training programs to ensure compliance with federal and state laws regarding occupational health and safety regulations. Strategic Plan Objectives Objectives derived from the Strategic Plan (pg. 19 -29) and specific to the Board of Directors are detailed in the following chart. Objective Provide support and encourage employee training .. WE -1 Maintain competitive compensation via classification and compensation surveys WE -2 Explore alternative benefits WE -3 Establish career development expectations of existing employees WE -1 Develop methodologies to assist employees in attaining career expectations WE -1 Continue to support additional training for staff WE -1 Identify key roles for succession WE -2 Define the competencies and motivational profile required for key roles WE -2 Identify individuals with the potential to perform highly in key roles WE -2 Develop methodologies to assist employees in preparing for advancement WE -1 Performance Measures 4 The District's Personal Development Program (PDP), offered through the Association of California Water Agencies Joint Powers Authority, is typically a two -year series of classes offered in one of three specialties - Supervisory, Human Resources and Operations. Participation is voluntary, but encouraged. 30 25 20 15 10 5 0 2009 -10 2010 -11 Development Program 2011 -12 2012 -13 2013 -14 � Enrolled —4F— Completed During FY 2011/12 four recruitments resulting in 299 applications were processed, eleven recruitments were conducted resulting in 727 applications processed in FY 2012/13 and eleven recruitments were conducted with 303 applications were processed in FY 2013/14. W VLM ANNUAL OPERATING BUDGET FISCAL' Number of Applications Processed 160 140 - 120 VO 100 87 80 Z GO - 40 L so 20 4 IN 3 S 2011 12 2012 -13 Fiscal Year Position ■ Acct Asst 1 ■ Acct Asst II ■ Associate Engineer ■ Cust Svc Rep ■ Engineering SeII cretary Finance Director ■ General Manager ■ GIS Technicun ■ HR Tech • Instry meatation Teets • Maint Dist Operator II • Plant Operator II Public Affair Intern Public Info specialist During calendar year 2009, the District experienced 3 workplace injuries, which resulted in a total of 91 days away from work and 0 days of job restriction. During calendar year 2010, the District experienced 8 workplace injuries, which resulted in a total of 1 day away from work and 1 day of job restriction. During calendar year 2011, the District experienced 4 workplace injuries, which resulted in a total of 71 days away from work and 2 days of job restriction. During calendar year 2012, the District experienced 5 workplace injuries, which resulted in 0 days away from work and a total of 13 days of job restriction. During calendar year 2013, there were five workplace injuries with ten days away from work and 90 days of restriction. During calendar years 2009, 2011 and 2013 the days away from work are significantly higher because the nature of the incidents required a longer recovery time. VL Mk ANNUAL 0PERATiit1G W 100 91 90 80 70 60 50 40 30 20 10 0 2009 Workplace Injuries 71 13 8 q 2 5 0 � 1 _. _J= 0 2010 2011 2012 ■ Injuries ■ Days Away from Work ® Days of Job Transfer /Restriction Accomplishments Fiscal Year 2013 -14 10 2013 • Arranged all aspects of the annual Health Benefits Fair and annual flu shots. • Conducted open enrollment for health benefits. 90 • Coordinated open enrollment for flexible benefits plan and optional life insurance. • Arranged for the retirement luncheon for Hank Samaripa. • Coordinated the annual Employee Recognition Luncheon & District Picnic. • Conducted /coordinated the following workplace training: o JPIA Annual Training Conference o NeoGov User Conference o ACWA/JPIA SoCal HR Group Meeting o California Society of Municipal Finance o Officers (CSMFO) Affordable Care presentation o Public Employees' Pension Reform Act Workshop o CalPERS Update, GASB 68 and the Economy of Pensions 0 Federal /State Leaves of Absence, Medicare, COBRA & ACA r � ANNUAL OPERATING Conducted /coordinated the following Safety training: 0 10 -Hour CalOSHA construction safety class 0 Global Harmonization System of Hazard 0 Communication (GHS) webinar 0 GHS mandated training for new employees 0 Pacific Safety Council: Confined Space Entry 0 OSHA Arc Flash Training 0 Pacific Safety Council: Certified Occupational Safety Specialist (COSS) 40 -hour program 0 Defensive Driving 0 Field Ergonomics (Operations /Production) 0 Traffic Control and Flagger Safety (Operations /Production) 0 Fire Safety /Fire Extinguishers (Operations /Production) 0 Confined Space Awareness and Rescue (Operations /Production) • Coordinated the following workshops open to all District employees; 0 Budgeting Workshop (Shay Olivarria) 0 Debt Handling & Planning for Retirement (Shay Olivarria) • Coordinated attendance at the following LCW Workshops: 0 Public Sector Employment Law Update 0 Orange County Human Resources Consortium 0 AB 1234 Mandatory Ethics Training Webinar 0 LCW 2014 Public Sector Employment Law Conference Revised /developed /implemented Rules, Policies and Procedures: 0 7010 Human Resources 0 Employee Time -Off Request Policy 0 Employee Performance Evaluation Procedure 0 7010 Risk Management 0 Facilities Use Policy 0 7030 Safety 0 Confined Space Program and Entry Procedures 0 Rescue Team Standard Operating Procedure (SOP) and training 0 Injury Illness Prevention Program (IIPP) 0 Trenching /Excavation Safety • Audited all District required OSHA training and put a calendar plan in place. • Reorganized the Safety Committee & Developed the New Hire Safety Orientation Human Resources Personnel Summary 1.0 1.0 1.0 1.0 0.5 Safety Safety & Training Coordinator - - - 1.0 1.0 1.0 1.0 Department Totals 3.0 3.0 3.0 4.5 4.0 Proposed Department FY 2010/11 FY 2011 /12 FY 2012/13 FY 2013/14 FY 2014/15 Administration Human Resources & Risk Mgr 1.0 1.0 1.0 1.0 1.0 Human Resources Analyst - - - - 0.5 Human Resources Technician 1.0 1.0 1.0 1.0 1.0 Human Resources Clerk - - - 0.5 - 2.0 2.0 2.0 2.5 2.5 Risk Management Human Resources Analyst - - - 1.0 0.5 Personnel Technician 1.0 1.0 1.0 - - 1.0 1.0 1.0 1.0 0.5 Safety Safety & Training Coordinator - - - 1.0 1.0 1.0 1.0 Department Totals 3.0 3.0 3.0 4.5 4.0 1� Human Resources Department Budget (FY 2014/15) Expenses (Operating) Salary Related Expenses Salaries Fringe Benefits Overtime Mandatory Benefits Total Salary Related Expenses Supplies & Services Communications Contractual Services Dues & Memberships Insurance Materials District Activities & Events Office Expense Professional Services Professional Development Travel & Conferences Supplies & Services Sub -Total FY 2013/14 FY 2014/15 Budget Budget $ 377,778 $ 373,949 $ 76,905 $ 75,009 $ - $ 1,689 $ 41,977 $ 44,874 $ 496,660 $ 495,521 $ 14,000 $ 3,000 $ 37,500 $ 34,150 $ 5,500 $ 5,635 $ 298,000 $ 311,500 $ 1,000 $ 1,400 $ 17,650 $ 17,510 $ 725 $ 700 $ 68,500 $ 70,700 $ 24,900 $ 25,500 $ 7,000 $ 5,100 $ 474,775 $ 475,195 Human Resources Budget Division Detail (FY 2014/15) Administration Division Prima GLCategory 1- 7010 - 0580 -00 Communications Category Total $3,000 Sub Acct No./Sub Category 1- 7010 - 0580 -05 Advertising Sub Acct 3,000 Detail Item Description Job Advertising Expenses Detail 3,000 1- 7010 - 0600 -00 Contractual Services $29,300 1- 7010 - 0600 -00 Contractual Services 13,500 COBRASolutions 1,500 Shred -it 1,500 CPSTesting 2,000 Neo Gov - Online Applications 3,000 Neo Gov - Performance Evaluations 5,000 Flex Advantage 500 1- 7010 - 0600 -10 DOTPhysicals 5,000 Fit for Duty 5,000 1 -7010- 0600 -20 Post - Employment Physicals 1,500 Post - Employment Physicals 1,500 1- 7010 - 0600 -30 Health & Welfare 9,300 Interactive Process 8,000 Flu Shots 1,300 1- 7010 - 0640 -00 Dues, Memberships & Subscriptions $4,485 1- 7010 - 0640 -00 Dues, Memberships & Subscriptions 4,485 SHRM Membership 200 LCW Consortium 3,200 PELRAC 600 Jobs Available Subscription 85 CALPELRAAnnual Dues 400 1- 7010 - 0715 -00 District Activities& Events $15,810 1- 7010 - 0715 -10 District Events - Employee 4,500 Employee Picnic 2,500 Employee Recognition Event (Holiday Luncheon) 2,000 1- 7010 - 0715 -20 District Events - Employee Recognition 4,810 Retiree Event (2) 4,000 Retiree Recognition (2) 210 Service Recognition 600 1 -7010- 0715 -30 District Events - Benefit Fair 2,000 Benefit Fair 2,000 1- 7010 - 0715 -40 District Events - Employee 3,000 Employee Promotional Items 3,000 1- 7010 - 0715 -50 Meeting Supplies 1,500 Meeting/Tra ining Supplies 1,500 1- 7010- 0760 -00 Office Expense $700 1- 7010 -0760 -00 Office Expense 250 Office Supplies 250 1- 7010 - 0760 -30 Books & Publications 450 Books & Publications 200 Public Retirement Journal 250 1- 7010 - 0780 -00 Professional Services $68,700 1- 7010 - 0780 -05 Legal Services 55,000 Liebert Cassidy Whitmore Employment Law 55,000 1- 7010 - 0780 -55 Investigations 13,700 Investigations, Backgrounds, and EE Relations 13,700 1- 7010- 0810 -00 Professional Development $11,500 1- 7010 - 0810 -00 Professional Development 11,500 LCW 4,500 On- goinglobTraining 2,000 Great Plains Training -HR Module 5,000 1 -7010- 0830 -00 Travel & Conferences $3,600 1- 7010 - 0830 -00 Travel & Conferences 3,600 PELRAC (3 employees) 600 LCW (3 employees) 2,000 Public Retirement Seminar (4 employees) 1,000 Section Total $137,095 Human Resources Budget Division Detail (FY 2014115) Risk Management Division Primary GL Category Category Total I Sub Acct No./Sub Category I Sub Acct I Detail Item Description Detail Amt, 1-7020-0600-00 $1,850 1- 7020 - 0600 -00 Total 1,850 DOT Physicals 1,500 Contractual Services Contractual Services AED Medical Director Oversight 350 1- 7020 - 0640 -00 $100 1- 7020 - 0640 -00 100 PARMAMembership 100 Dues, Memberships, & Dues, Memberships, Subscriptions Subscriptions 1- 7020 - 0690 -00 $311,500 1- 7020- 0690 -10 8,000 Tort Claims - <15K 8,000 Insurance Tort Claims 1- 7020 - 0690 -20 243,500 ACWA-JPIA Liability Insurance 243,500 Liability Insurance 1- 7020 - 0690 -30 60,000 ACWA- 1PIAProperty Insurance 60,000 Property Insurance 1- 7020 - 0780 -00 $2,000 1 -7020- 0780 -00 2,000 First Aid - Workers Compensation 2,000 Professional Services Professional Services 1- 7020 - 0810 -00 $1,000 1- 7020 - 0810 -00 1,000 Risk Management Training 1,000 Professional Development Professional Development 1- 7020 - 0830 -00 $1,500 1- 7020 - 0830 -00 1,500 PARMAConference(lemployee) 1,500 Travel & Conferences Travel & Conferences Section Total $317,950 I qt Human Resources Budget Division Detail (FY 2014/15) Safety Division Primary GIL Category Category Sub Acct No./Sub Category To I 1-7030-0600-00 $3,000 1- 7030 - 0600 -00 Contractual Services Contractual Services Sub Acct I Total 3,000 Detail Item Description I HEP B Detail Amt I 1,000 Industrial Hearing Management 2,000 1- 7030 - 0640 -00 Dues, Memberships, & Subscriptions $1,050 1- 7030 - 0640 -00 Dues, Memberships, & Subscriptions 1,050 Cal -OSHA Reporter 500 PASMA 200 Pacific Safety Council - COSS 350 1- 7030 -0710 -00 Materials $1,400 1- 7030 - 0710 -00 Materials 1,400 First Aid Kit 200 First Aid Supplies (Field Backpacks) 1,200 1- 7030 -0715 -00 District Activities and Events $1,700 1- 7030 - 0715 -50 Meeting Supplies 1,700 Meeting/Training5upplies 500 Safety Recognition Events 1,200 1- 7030 -0810 -00 Professional Development $13,000 1- 7030 - 0810 -10 OSHACompliance 13,000 OSHACompliance Training 13,000 Section Total $20,150 W y.11 Z J vO- tL wU) OG�( �O Q OPERATIONS Q TEOHNp1" ��'� v o ca RISK °~ pNESS, Q a pREpp,RE RRUp11(�. y =SAM Z All BUSINESS INTE .rEG�C CUSTOMERS a 41 SIRA CY cn GE N z0 EtA ER N-r ME �E Y �C" PO RI N1ANA > �oWAUt4lT 0 UAMAGE LIFESA' z AF ETY U pLpNS _ F _oou z C:) 5 -TER U_ STORMS o o BEN REC4 SE ES in ul Z 1 Rp MA71ON 1 5. LY O C w m- 0 Supplies & Services Summary by Department Division Operations Information Technology Finance F llgireel ing FY 2014/15 Human Resources Department lent Safety Administration VLM ANNUAL OPERATING BUDGET FISCAL' Information Technology 0 Department Organization Chart Information - Technology Department I.T. Manager G.I.S. Info. Systems S.C.A.D.A. Analyst I Administrator Administrator Info. Systems Systems Analyst/ Instrumentation Technician I Programmer Technician ®Yorba Linda Water District Organization Chart lob Classification Lposd FY 2014/15 Management Partilme Su wiso /Confidential Bar ainin Un[ Lo ANNUAL OPERATING Information Technology The Information Technology Department provides IT support for the District's computer network, including the operation, maintenance, upgrade, and repair of network hardware and District employee workstations. Additionally, the IT Department manages the day -to -day operation of the network datacenter and servers, District's communications systems, security and software applications. The IT Department is also responsible for creating, testing and evaluating new software applications and hardware being considered for purchase by the District to insure they perform in our current and future infrastructure. The Department is responsible for the administration and coordination of the District's information systems and computer network, including the Geographic Information System (GIS) and the Supervisory Control and Data Acquisition (SCADA). Division Responsibilities INFORMATION SYSTEMS Information Systems administers the development and maintenance of the District's Information Systems, computer network and databases that allows for effective and efficient integration of computer technologies into the daily business practices of the District. It consists of the following: billing, accounting, operations and engineering related information systems. It provides planning, employee technical training and coordinating services with contract consultants. Also included is technical support, which assists other departments with technology related issues by providing help desk support. It provides user computer installations and configuration, technical support and coordinating services with support contract consultants. Information Systems is responsible for PCs, telephones, cell phones, walkie- talkies, facsimiles, voice mail, routers, switches, VPN and firewalls. It is also responsible for internet and intranet connections; monitoring and securing the District's computer network data traffic. GEOGRAPHICAL INFORMATION SYSTEM (GIS) GIS is charged with building and maintaining the layers of graphic data used by the District to produce visual representations and analysis for informed decision making in the water and sewer system. This is accomplished by maintaining the Geographic Information System (GIS), performing geospatial analysis of data and display data on GIS maps; preparing charts, graphs and displays; coordinating system needs with other departments; defining requirements for end users; coordinating services with contract consultants for maintenance agreements; researching information from records, surveys and assessor maps; performing field data collection; programming and scripting for customization of software applications. SUPERVISORY CONTROL AND DATA ACQUISITION ( SCADA) SCADA is responsible for the communications and the hardware related to the District's SCADA system. Communications includes radios, lease lines, and all other means for ensuring SCADA remote sites communicate with the District's headquarters. Additionally, SCADA is responsible for all sensors in the field that collect and saving about 5 year of historical information. The SCADA system provides Operators advanced fully automated controls 24/7/365 to meet the Districts objectives. Strategic Plan Objectives /Goals Objectives derived from the Strategic Plan (pg. 19 -29) and specific to the Board of Directors are detailed in the following chart. Objective Integrate GIS with Hydraulic Model, CMMS, Valve Exercise and Hydrant Flushing SP Goal OE -1 Replace and reprogram various PLCs OE -1 Improve radio communications OE -1 Implement Field GIS software (Underground Service Alert, As -built Lining and Red - lining) OE -1 Install a reliable backup power system at remote control sites. OE -1 Performance Measures HelpDesk Tickets Processed ■ Closed ■ On -Hold Open 2 101 100 99 98 97 r d 96 95 94 93 92 QaQ'L Q�Q o� r ���i �Q �'0� `c`'�r eracQ, 0,10 �r�et ,�V `owe 41, `fie a0` J -1-41, ill` � FY 2012 � FY 2013 YTD (Goal Note: Server Up Time refers to the percentage of time each server is available for usage. Includes planned maintenance shutdowns. Accomplishments FY 2013/14 • Successfully Implemented Computer Maintenance and Management System • Upgraded Dynamics GP from version 10 to version 2013 • Data archive solution purchased and installed • Implemented District network Improvement Project —Phase I by replacing older switches • Reviewed and corrected Dynamics GP HR & Payroll Module • Replaced Domain Controller Servers (1 physical and 1 virtual) • Improved Records Management Program • Cell phone program implemented to keep cell phones contacts updated • Doubled internet connectivity bandwidth through Time Warner fiber • Replaced and reprogramed Well -5 PLC completed • Replaced and reprogramed Paso Fino PLC • Replaced and reprogramed Well -18 PLC completed • Replaced and reprogramed Timber Ridge PLC • Installed ring switch system in the well field replacing 10 year old fiber industrial switches • Corrected difficult Highland BPS Motor control Center problem(s) found post warranty • Implemented a new contract for CMMS and GIS Services Accomplishments FY 2013/14, Continued • Printed Sewer Atlas Books • Adopted GIS Maintenance Procedure • Upgraded GIS to the latest version • Made the Wireless link between Box Canyon BPS and Hidden Hills Reservoir for Box Canyon BPS redundant communications 0 aair oft , backup guide in oima ionm processing S CID anr� nn nr� media firms �� N I Y I I I I I 1 1 P 9p. iscpo plays ""= YS Kku Ppropria�e ieaal roced IOSt wp s federal '!appendix, torage - Wiwi" conlingency include name -o alternate te C= operallons iaruplian n., ErEllt functions may. personnel CAD requirements cfl fesiicg ClJ ANNUAILOPERATINGI-4,-,%CV, Information Technology Personnel Summary Proposed Department FY 2010/11 FY 2011 /12 FY 2012/13 FY 2013/14 FY 2014/15 Administration Assistant General Manager 0.5 - - - - Information Systems Manager - 1.0 1.0 1.0 1.0 0.5 1.0 1.0 1.0 1.0 Information Systems Information Systems Admin. 1.0 1.0 1.0 1.0 1.0 Information Systems Tech 1 1.0 1.0 1.0 1.0 1.0 Information Systems Tech II 1.0 1.0 1.0 1.0 - System Analyst/ Programmer - - - - 1.0 3.0 3.0 3.0 3.0 3.0 GIS GIS Administrator 1.0 1.0 1.0 1.0 - GIS Analyst - - - - 1.0 GIS Technician 0.5 0.5 0.5 0.5 - 1.5 1.5 1.5 1.5 1.0 SCA DA Instrumentation Technician 1.0 1.0 1.0 1.0 1.0 SCADA Administrator 1.0 1.0 1.0 1.0 1.0 2.0 2.0 2.0 2.0 2.0 Department Totals 7.0 7.5 7.5 7.5 7.0 44 Information Technology Department Budget (FY 2014/15) Supplies & Services Contractual Services $ FY 2013/14 $ FY 2014/15 Data Processing $ Budget $ Budget Expenses (Operating) $ 1,327 $ 1,622 Salary Related Expenses $ 11,275 $ 15,825 Salaries $ 623,479 $ 602,394 Fringe Benefits $ 100,390 $ 91,979 Overtime $ 10,400 $ 10,400 Mandatory Benefits $ 76,809 $ 75,102 Total Salary Related Expenses $ 811,078 $ 779,875 Supplies & Services Contractual Services $ 138,520 $ 143,120 Data Processing $ 170,730 $ 186,830 Dues & Memberships $ 1,327 $ 1,622 Materials $ 11,275 $ 15,825 District Activities & Events $ 300 $ 300 Maintenance $ 84,950 $ 79,250 Non - Capital Equipment $ 98,100 $ 98,950 Office Expense $ 19,175 $ 15,025 Professional Services $ 56,000 $ 91,500 Professional Development $ 16,800 $ 11,800 Travel & Conferences $ 9,300 $ 9,700 Supplies & Services Sub -Total $ 606,477 $ 653,922 IT Budget Division Detail (FY 2014/15) Administration Division Primary GIL Category I 1-6010-0830-00 Travel & Conferences Category I To $4,000 Sub Acct No./Sub Category Sub Acct I I Total 1- 6010 -0830 -00 4,000 Travel & Conferences Detail Item Description Detail Amt 1 1 Interop (April /May) 1,200 WinConnections (November) 2,800 Section Total $40000 IT Budget Division Detail (FY 2014/15) Information Systems Division Category Total $113,620 Sub Acct No./Sub Category 1- 6020 - 0600 -00 Contractual Services SubAcct Total 1,940 Detail Item Description Security Solutions: Annual Fire & BurglarAlarm Detail Amt 1 1,700 1- 6020 - 0600 -00 Contractual Services District Web Site Hosting 240 1- 6020 - 0600 -10 Data Hosting 1,200 FTP Today 1,200 1- 6020 - 0600 -20 Lease Agreements 15,500 Konica Minolta Operations Copier Lease 4,500 Konica Minolta Copier Leases for Admin Building 11,000 1- 6020 - 0600 -30 Warranties & Service Contracts 27,780 RMJ Tech. GPS Vehicle Tracking Service 20,000 APC Symmetra Data Center UPS On -Site Service Rene 3,780 Dell Hardware Service Contracts 4,000 1- 6020 - 0600 -32 Service for Cell Phones 25,000 Cell Phone Service(Verizon) 25,000 1- 6020 - 0600 -33 Mobile Broadband Service 11,000 Verizon Broadband Aircard Service inc. CMMS 11,000 1- 6020 - 0600 -34 Communication Lines 31,200 Time Warner Cable & Dedicated Internet Access 20x 16,200 AT &T District Lines 15,000 1- 6020 - 0620 -00 Data Processing $130,830 1- 6020 - 0620 -10 Software Purchases 4,500 CMMS Licensing 4,000 New Software 500 1- 6020 - 0620 -20 Software License Renewals 120,280 Solar Winds Orion Monitoring Tool Maintenance 10,000 VMWarevSphere (Essentials Plus Kit) Maintenance 6,000 Trend Micro NeatSuite Antivirus & Spyware 110lic 2,500 Lenel Onguard Software Support Agreement Renewal 250 Netmotion Mobility XE Premium Software 2,000 Laserfche Software Assurance Plan (LSAP) 4,780 Solar Winds Engineering's Toolkit Renewal 800 Novus Agenda Maintenance Renewal 4,000 Microsoft Volume License Renewals 28,000 CityWorks Annual Maintenance 12,000 GP & Cogsdale annual Maintenance 49,500 Enterprise Leave Managerfor Dynamics GP Maint. 450 1- 6020 - 0620 -30 Hardware Subscription Renewals 5,550 Watchguard x1250e Firewall UTM Renewal 2,900 BDR Monthly Charge for Offsite Backup Storage 300 Barracuda Spam Firewall Energizer Annual Renewal 750 Barracuda Message Archiver Energizer Annual Renew 1,400 PageR Monitoring 200 1- 6020 - 0620 -47 Cell Phone Supplies 500 Chargers 150 Batteries 200 Holsters & Covers 150 1- 6020 -0640 -00 Dues, Memberships, & Subscriptions $872 1- 6020 - 0640 -00 Dues, Memberships, & Subscriptions 872 Maximum PC 12 CPU 30 PC W orl d 50 Misc Memberships 250 Smart Computing 30 MSTech Net Plus Subscription 500 1- 6020 - 0710 -00 Materials $2,500 1- 6020- 0710 -00 Materials 200 Materials 200 1- 6020 - 0710 -49 Power Strips 100 Power Strips 100 1- 6020 - 0710 -51 Cabling 700 Duplex 50 /125 LC /LCfiber, CAT6A, CATSe patch cab 400 Adapters 100 DVI, VGA, DES, Display Port, HDMI, USB cables 200 1- 6020 - 0710 -60 Hardware Supplies 1,500 USB Drives USB Keys, SD /micro SD Cards 200 Desktop peripherals 900 Hardware supplies, AA& AAA batteries 400 1- 6020 -0715 -00 District Activities and Events $300 1- 6020 - 0715 -50 Meeting Supplies 300 1 Meeting Supplies 300 IT Budget Division Detail (FY 2014115) Information Systems Division, Continued 1- 6020 - 0730 -00 Maintenance $6,900 1- 6020 - 0730 -00 Maintenance 850 Row Maintenance 850 1- 6020 -0730 -06 Printer Servicing 1,200 HP Printer Servicing 1,200 1- 6020 -0730 -11 Telco /Phone Servicing 2,000 Building Line Repairs 400 Cell Phone Servicing/replacement /repair 800 Phone Switch Servicing 400 Security Equipment Maintenance & Repair 400 1- 6020 - 0730 -30 Cabling& WAN 1,500 Cabling(CAT6A, CATSe, fiber) installation & rep 1,500 1- 6020 -0730 -60 UPS &Back-up Power systems 1,350 APC Symmetra Data Center UPS battery modules (6) 1,000 UPS replacement batteries for desktops 350 1- 6020 -0750 -00 Non - Capital Equipment $57,500 1- 6020 -0750 -00 Non - Capital Equipment 2,000 Non - Capital Equipment 2,000 1- 6020 -0750 -06 Desktops 10,600 Dell Optiplex PCs 10,000 Thin Clients 600 1- 6020 -0750 -07 Notebooks 31,200 CMMS Notebooks and Equipment 20,000 Dell Notebooks 6,400 Tablets (Field /Eng) 4,800 1-6020 -0750 -08 Printers 2,000 Replacement Printers 2,000 1- 6020 - 0750 -09 Networking Equipment 4,900 KVM System Interface Pods 200 Network Storage Devices 1,500 Network Office /cubicle Switches 200 Misc Network Equipmentsuch as Transceivers 800 Data Center Switches 2,200 1- 6020 -0750 -30 Tools & Equipment 800 Data Centerequipment (Rack & Cabinet) 800 1- 6020 -0750 -35 Security 1,500 HID proximitybadges for building access 500 FABS 1,000 1- 6020 -0750 -41 Audio/Visual 3,500 Replacement LCD Monitors 3,000 Digital Cameras (Ops) 500 1- 6020 -0750 -45 Telco 1,000 Phones & Accessories 1,000 1- 6020 - 0760 -00 Office Expense $10,325 1- 6020 -0760 -00 Office Expense 100 Business Cards 100 1- 6020 -0760 -21 Printer Supplies 9,225 HP LaserJet Printers & Copiertoners fusers etc 9,000 Konica Minolta Copier /Printer Supplies for Ops 175 Konica Minolta Copier /Printer Supplies Mail Room 50 1- 6020- 0760 -26 Desktop Supplies 1,000 Mice 200 Blank DVD +R, CD Disc, USB Keys etc. 200 Keyboards 400 Misc 200 1- 6020 - 0780 -00 Professional Services $40,000 1- 6020 -0780 -11 Network /Hardware Consulting 10,500 Network Engineering Consulting 10,500 1- 6020 - 0780 -20 Software Consulting 28,500 Software Consulting 3,500 CMMS Consulting EEC 25,000 1- 6020 -0780 -50 Technical Support 1,000 Technical Support 1,000 1.6020 -0810 -00 Professional Development $2,500 1- 6020 -0810 -00 Professional Development 2,500 VIA Ware Training 2,500 1- 6020 -0830 -00 Travel & Conferences $3,600 1- 6020 - 0830 -00 Travel & Conferences 3,600 Intersect (October) R.S. 2,200 CityWorks User's Conference (June) R.S. 1,000 Mileage and Travel Reimbursement 400 Section Total $368,947 IT Budget Division Detail (FY 2014/15) GIS Division 1- 6030- 0620 -00 $21,400 1- 6030 - 0620 -20 Data Processing Software License Renewals 21,400 Detail ater Renewal & Upgrade Floating License 4,700 nce Maintenance Fno 2, 000 torConcurrent Maintenance(2) 3,200 ServerStandard Enterprise Maintenance 6,000 ArcViewSingle Use Maintenance 500 ArclnforConcurrent Maintenance 3,500 AutoCAD & Map 3D Maintenance 1,500 1- 6030 - 0750 -00 Non - Capital Equipment $9,600 1- 6030 -0750 -20 Printers 5,500 New Color Scanner 5,500 1- 6030 - 0750 -30 Tools & Equipment 4,100 GIS Miscellaneous Tools (Hardware) 4,100 1- 6030 -0760 -00 Office Expense $4,400 1- 6030 - 0760 -21 Printer Supplies 4,400 Atlas Water &Sewer Supplies 4,400 1- 6030 -0780 -00 Professional Services $20,000 1- 6030 - 0780 -20 Software Consulting 20,000 GIS StaffAugmentation & Cons. Services, EEC 20,000 1- 6030 - 0810 -00 Professional Development $5,000 1- 6030 - 0810 -00 Professional Development 5,000 GIS Analyst Training 2,000 GIS and CMMSTraining, EEC 3,000 1- 6030 - 0830 -00 Travel & Conferences $700 1- 6030 - 0830 -00 Travel & Conferences 700 GIS ESRI User Conference 500 Mileage and Travel Reimbursement 200 Section Total $61,100 IT Budget Division Detail (FY 2014/15) SCADA Division 1- 6040 - 0600 -00 $29,500 Contractual Services 1- 6040 -0600 -30 Warranties & Service Contracts .. ,. 5,500 Cisco Smartnet premium (for Cisco 1842 routers) Cisco Smartnet premium (forCisco 3825 router) Dell Servers Service contracts ,. 1,500 2,500 1,500 1- 6040 -0600 -34 Communication Lines 24,000 Communication Lines 24,000 1- 6040- 0620 -00 Data Processing $34,600 1- 6040 -0620 -10 Software Purchases 1,600 Misc. software 1,600 1- 6040 -0620 -20 Software License Renewals 33,000 Wonderware Premium Support 29,500 PLC Programing Support Proworks32 & Unity 3,500 1- 6040 - 0640 -00 Dues, Memberships, & Subscriptions $750 1- 6040 -0640 -00 Dues, Memberships, & Subscriptions 750 International Society of Automation 250 AW WA 500 1- 6040 - 0710 -00 Materials $13,325 1- 6040 -0710 -50 Electrical Supplies 3,800 Electrical Supplies 3,800 1- 6040 -0710 -60 Hardware Supplies 3,000 Hardware Supplies 3,000 1- 6040 -0710 -72 Calibration Supplies 850 Calibration Supplies 850 1- 6040 -0710 -78 Meters & Sensors 5,675 Integral Manifolds for Flow& Pressure Meters 1,175 Level Indicators 3,000 Flow Meter 1,500 1- 6040 - 0730 -00 Maintenance $72,350 1- 6040 -0730 -15 Flow Meter Calibration 2,200 Flow Meter Calibration 2,200 1- 6040 -0730 -20 Electrical General 18,000 Electrical General Maintenance 18,000 1- 6040 -0730 -25 Electrical Motor Control Center 3,800 Motor Control Center 3,800 1- 6040 -0730 -30 Cabling& WAN 4,650 Conduit Replacement /Wiring Replacement/WAN Com 4,650 1- 6040 -0730 -40 Radio repairs & Servicing 9,500 Radio repairs & Servicing 9,500 1- 6040 -0730 -45 PLC Hardware 16,900 Powersupplies & components 500 M340 system /PLC's 11,000 Module replacements 3,100 Terminal Blocks /Other parts 1,500 Signal Conditioners - Converters 800 1- 6040 -0730 -55 Security & Gas detectors 2,800 Security& Gas detectors 2,800 1- 6040 -0730 -60 UPS & Back -up Power systems 5,500 UPS & Back-up 24VDC Power systems 5,500 1- 6040 -0730 -61 Cooling A/C Servicing 4,000 Cooling &A/C Service 4,000 1- 6040 -0730 -62 Instrumentation 5,000 Instrumentation 5,000 IT Budget Division Detail (FY 2014/15) SCADA Division, Continued OL tegory 1- 6040 - 0750 -00 Non - Capital Equipment $31,850 Wub"cl 11o./Sub Category 1- 6040 - 0750 -09 Networking Equipment Sub Acct 8,000 Detail Description Field Routers, Switches, Fiber Device Servers, Mod Detail 8,000 1- 6040 - 0750 -30 Tools & Equipment 1,550 Tools & Equipment 1,550 1- 6040 - 0750 -35 Security 6,500 Security 6,500 1- 6040- 0750 -55 PLCs & Panels 5,000 PLCs & Panels 5,000 1- 6040 - 0750 -65 Electrical Upgrades 5,000 Electrical Upgrades 5,000 1- 6040 - 0750 -70 Redundant SCADA 5,800 Radio systems Communications & tower 5,800 1- 6040 - 0760 -00 Office Expense $300 1- 6040 - 0760 -30 Books & Publications 300 Manuals /Books /Magazines 300 1- 6040 - 0780 -00 Professional Services $31,500 1- 6040 - 0780 -20 Software Consulting 31,500 PLC program Conversions to Unity 10,500 SCADA system programing 11,000 Maintenance PLC -SCADA Modifications 10,000 1- 6040 -0810 -00 Professional Development $4,300 1- 6040 - 0810 -00 Professional Development 4,300 Wonderware training 2,400 PLCprogramingtraining 1,400 Awwa training 500 1- 6040 - 0830 -00 Travel & Conferences $1,400 1- 6040 - 0830 -00 Travel and Conferences 1,400 Awwa Conference 1,400 Section Total $219,875 G 4.� Supplies & Services Summary by Department Division Operations 0- Human Resource Administration Finance Engineering FY 2014/15 IT Department Administration Board of Directors GIS Information Systems VLM ANNUAL OPERATING BUDGET FISCAL' Operations 4 Department Organization Chart Operations Department Doeral -s Manager OperatitMS/ Water Maint. Office Warehouse nsslst. SucerinteMent 01¢rk Sr. Maintenance Sr. Maintanance Sr. Maintanance Sr. Maintanance Fatlmies Dist.Oceraror Disl.Ocerator Disl.Ocerator Disl.Oceretor Mainrenance Mainta —e Dist. Maintanatce Dist. Maintanance Dist. Opeator III Oprrator 111 Maintanance Dist. operator 111 Operator 111 MWltanance Olst. Maintenance III Maintenance Dist. Maintanance Dist. Oprrator II Operator It operator 11 Operator II Mainenance Dist. Maintanance DtSL Malnlanwe Dist. Opeator ll Operator It Maintanance Dist. oceator It operator It ®Yorba Linda Water District Organization Chart FY 2014/15 Malnlanante Worker 1 Maintanance Maintanance WorkerI Worker I Minn.— Maintanance Worker I Worker 1 Maintanance Worker I NJ Job Classification LoWd Management Part -Time Water Prodwian S— rintendent Sr. Plant Ooe ator Plant Operator II Plant Operator II Plant Operator 11 Bar ainin Unit. Operations Under the direction of the Operations Manager, the Operations Department is responsible for maintaining and overseeing the District's water storage, production, pumping and distribution systems; sewer collection systems; production water wells and related equipment; fleet rolling stock and stationary equipment mechanical maintenance. The Operations Department maintains the water distribution system and ensures it is running properly in order to provide safe, reliable drinking water to the District's customers. Due to the complexity of the Yorba Linda Water District's distribution and treatment systems, the California Department of Public Health Services (CDPHS) has classified the system at a Distribution Level 5, and a Treatment Level 2 system. Division Responsibilities OPERATIONS ADMINISTRATION The Operations Administration division is composed of three employees that perform the day -to -day supervision and administration of water and sewer maintenance, water production, materials procurement and inventory work. The department's safety and risk management program are also emphasized in this section. P�a WATER OPERATIONS AND MAINTENANCE This division is separated into specific areas and duties that are assigned to three crews: Leak Crew, Valve Crew and Hydrant Crew. Personnel are cross trained and are assigned to crews based on workloads and demands. The crews do not perform only single duties, but rather deal with other related aspects of the crew's primary assignments. An example of the duties and an estimate of the number of work tasks for each crew, based on a 12 month period, are as follows: • Leak Crew - composed of five crew members. This crew conducts repairs on approximately 22 main lines and 50 service lines. They also conduct replacements of approximately 150 water lines, 120 Angle Meter Stops (AMS) valves; install 140 new meters; and replace 150 stuck meters. • Valve Crew - composed of six crew members. This crew operates, as part of the District's Preventive Maintenance (PM) program, one half of the District's 10,706 system valves, repairs approximately 30 valves and replaces approximately fifty valves annually. Additionally, this crew is called upon to perform valve operations for approximately 20 major line shut downs or isolations required to accommodate construction tie -ins to the system by contractors. • Fire Hydrant Crew - composed of seven staff members. This crew services all of the District's fire hydrants (3,881) annually. Nonfunctional hydrants, when detected, are repaired or replaced immediately. It is estimated that approximately 100 hydrants will need repair and approximately 50 will be replaced during the coming fiscal year. This crew's additional related duties include: • Servicing Air Vac Air Release (AVAR) valves — The crew services approximately 330 system AVARs annually. It is estimated that approximately eight will be repaired and fifteen will be replaced during the year. • Water Main Flushing — The crew flushes all dead end mains (155) twice per year. Additionally, the crew performs any formal flushing requests which average about fifty per year. • Servicing of system Pressure Control Valves (PCVs). Setting and servicing is done annually to approximately 150 valves. Additionally, PCV adjustments are made as requests arise from the Production Division. • Fire Flow Testing - This crew conducts the physical hydrant testing when requested by the District's Engineering Department. There is an average of twelve flow tests per year. • Field Customer Service Calls — The crew immediately responds to calls regarding water system complaints or problems. Each call is responded to with appropriate corrective action. Contact is made to inform the caller of the District's action in resolving the problem. The combined number of calls handled by this crew and the after -hours standby staff is in the area of 1,200 calls annually. A, �170 M 1, o: SEWER OPERATIONS AND MAINTENANCE This division is charged with the operation and maintenance of the District's sewer collection system and the related assets. Methods and means for collection system maintenance fall within the duties of the sewer crew. Sewer Collection Crew — consists of seven members. This crew performs maintenance tasks that are intended to keep the collection system performing as designed and to extend the life of assets where possible. The system maintenance tasks are as follows: • Main line cleaning — The crew cleans approximately 235 miles of sewer main lines annually. This maintenance includes cutting of intrusive tree roots from the sewer lines where encountered. • Enhanced Maintenance Areas (EMAs) — EMAs are those areas that require attention more than just once per year. The District has 45 EMAs that are cleaned quarterly and 49 that are cleaned monthly. • CCTV Inspection — Inspection of the District's sewer lines is conducted at a rate of one sixth of the system or 39 miles yearly. Damage found to the main lines is prioritized for repair and dealt with accordingly. • Approximately twenty four line repairs were completed in addition to eight manholes being rehabilitated during fiscal year 2011 -2012. • Sewage Lift Stations — Two sewage lift stations are operated and maintained by this crew. They assure the stations are operational and respond to any station SCADA alarms. WATER PRODUCTION The primary objective of the Production Division is to supply quality drinking water on a daily basis that meets and or exceeds the California Department of Health Services drinking water standards at the most economical cost to our customers. The Production Division, which consists of five staff members, is responsible for the operation and maintenance of the District's water supply, water conveyance, water storage, water disinfection, and water treatment systems. The primary assets in the distribution system include 38 booster pumps, 10 water wells, 6 chlorine generating systems, 12 chlorine analyzers, 3 import water connections, 14 reservoirs, 2 reservoir mixing systems, 54 pressure regulating stations, 2 stationary backup power generators, 3 trailer mounted emergency pumps, and 1 trailer mounted emergency generator. Activities performed by the Production Section include, overseeing and performing the operation and maintenance of the system's assets, ensuring reservoirs have sufficient water volume to meet the daily demands, monitoring water quality, chlorine disinfection levels, power demands, water supply allocations, and weather patterns and ensuring the District's water supply and facilities are secured from potential threats and contaminations. The water system is operated and maintained 24 hours per day, 365 days per year. This is done by utilizing a Supervisory Control and Data Acquisition, ( SCADA) system equipped with alarm notifications. It is critical to the operation of the water system for the Production Section and the IT Department to work very closely with common goals to maintain the SCADA infrastructure and set up control strategies that best support the operational goals of the District. Some of the SCADA infrastructure includes human machine interface (HMI's), level and pressure transmitters, flow meters, chlorine analyzers and program software updates. MECHANICAL SERVICES This division is composed of three mechanics, which provide for the maintenance and repair to the District's vehicle fleet, heavy equipment, stationary engines, pumps, and assorted small equipment. Additionally, they provide interface and compliance reporting to regulatory agencies such as: AQMD, CARB, OCFA, EAP, BAR and OCHCA on behalf of YLWD. This section is responsible for the District's following assets: Rolling Stock: • Maintains 54 vehicles, including 2 sewer combo trucks, 1 hydro excavator and 4 dump trucks, 3 backhoes, 1 forklift, and 12 trailers used for emergency pumps, generator, light boards, air compressors, etc. Small Equipment: • Maintains over 60 pieces of small equipment including pneumatic pavement breakers, soil tamps, water pumps, electrical generators, air compressors, concrete and wood saws, etc. Large Stationary Internal Combustion Engines: • Maintains the engines that are the prime movers for 2 large generators, 4 deep well water pumps, and 8 water system booster pumps. FACILITIES MAINTENANCE One staff member oversees this division and is responsible for the maintenance and upkeep of District buildings and facilities sites. The staff interfaces and oversees work of hired contractors as it relates to facility maintenance. • Landscape Maintenance - all services both to maintain the District's primary site as well as performing weekly, monthly, and quarterly tasks at all of the District's pump and reservoir locations. • Electrical Repairs - all repairs to building lighting both inside and out in addition to any electrical problems at other District sites. • Janitorial Maintenance - interface and oversight to assure that contract terms are being met. • AC and Heating - oversight for service scheduled quarterly at the Miraloma facility, including the warehouse and operations buildings. • Fire sprinkler and equipment inspection required per OCFA's annual reporting requirements. • Responsible for the hiring of contractors to provide road and compound type repairs, and miscellaneous fence and building repairs. • Staff in this section works with the Public Affairs staff to support District activities such as coordinating bottle water deliveries and setting up for special events, etc. • Current projects include working with the Production Division in repairing and painting fencing at reservoir sites. This is part of an ongoing upkeep program at these sites Strategic Plan Objectives /Goals Objectives derived from the Strategic Plan (pg. 19 -29) and specific to the Board of Directors are detailed in the following chart. Objective SP Goal Evaluate How Each Department Might Make Further Use of Existing OE -1 Technology Provide Support and Encourage Employee Training WE -1 Establish Career Development Expectations of Existing Employees WE -1 Develop Methodologies to Assist Employees in Attaining Career WE -1 Expectations Performance Measures ]X zm 1so 1m oso om Average CIZ Residuals by Reservoir zw&z 200Y2010 2.1 2011 2011 M12 2012 X13 �nnw m[r wogr tcrai�swm+aw �a�mna.Hwx �1rcn. ca�r� —M... — Hift 8ry 10.arc� aa�flk MOUmaln �Camlro Ee &pm f.A\Nmwn Note: Average C12 Residuals by Reservoir is for import water reservoirs only. 60.0% 50.0% 40.0% 30.0% 20.0% 10.0% 0.00/0 3 2.5 2 1.5 1 0.5 0 2008 -2009 2009 -2010 2010 -2011 2011 -2012 2012 -2013 oBPP Goal oActual Ground Water uActual Import Water LulU-LUll 2011 -2012 2012 -2013 ■ Electric Motors ■ Booster Pumps Li Gear Drives ■ 02 Systems ■ N.G. Engines ANNUAL OPERSTING El� ,1� 17 Operations Personnel Summary Department FY 2010/11 FY 2011/12 FY 2012/13 FY 2013/14 Proposed FY 2014/15 Administration 1.0 1.0 1.0 1.0 1.0 Maint. Distribution Operator II 1.0 - - - - Maint. Distribution Operator III - - - - - Office Clerk - - - - 1.0 Operations Assistant 1.0 - - - - Operations Assistant/Storekeeper - 1.0 1.0 1.0 - Operations/Warehouse Assistant - - - - 1.0 Operations Manager 1.0 1.0 1.0 1.0 1.0 Department Totals 2.0 2.0 2.0 2.0 3.0 Water Operations & Maintenance Water Maintenance Superintendent 1.0 1.0 1.0 1.0 1.0 Maint. Distribution Operator II 5.0 5.0 7.0 7.0 7.0 Maint. Distribution Operator III 3.0 3.0 3.0 3.0 3.0 Maintenance Worker 1 6.0 6.0 5.0 5.0 5.0 Sr. Maint. Distribution Operator 3.0 3.0 3.0 3.0 3.0 18.0 18.0 19.0 19.0 19.0 Sewer Operations & Maintenance Maint. Distribution Operator II 1.0 1.0 1.0 1.0 1.0 Maint. Distribution Operator III 1.0 1.0 1.0 1.0 1.0 Maintenance Worker 1 2.0 5.0 4.0 4.0 4.0 Sr. Maint. Distribution Operator 1.0 1.0 1.0 1.0 1.0 Mechanical Services Mechanic II 5.0 8.0 7.0 7.0 7.0 Water Production 1.0 Chief Plant Operator 1.0 1.0 1.0 1.0 - Senior Plant Operator 1.0 1.0 1.0 1.0 1.0 Maint. Distribution Operator II 1.0 - - - - Maint. Distribution Operator III - - - - - Maintenance Worker I - - - - - Plant Operator II 3.0 3.0 3.0 3.0 3.0 Water Production Superintendant - - - - 1.0 Mechanical Services Mechanic II 1.0 1.0 1.0 1.0 1.0 Mechanic III 1.0 1.0 1.0 1.0 1.0 Senior Fleet Mechanic 1.0 1.0 1.0 1.0 1.0 3.0 3.0 3.0 3.0 3.0 Facilities Maintenance Facilities Maintenance 1.0 1.0 1.0 1.0 1.0 1.0 1.0 1.0 1.0 1.0 Department Totals 35.0 37.0 37.0 37.0 38.0 1� Operations Department Budget (FY 2014/15) Supplies & Services Communications $ FY 2013/14 $ FY 2014/15 Contractual Services $ Budget $ Budget Expenses (Operating) $ 700 $ 700 Salary Related Expenses $ 37,900 $ 37,050 Salaries $ 2,458,469 $ 2,574,013 Fringe Benefits $ 556,290 $ 535,515 Overtime $ 191,600 $ 160,500 Mandatory Benefits $ 385,973 $ 420,823 Total Salary Related Expenses $ 3,592,332 $ 3,690,851 Supplies & Services Communications $ 500 $ 500 Contractual Services $ 153,900 $ 176,500 Dues & Memberships $ 700 $ 700 Fees & Permits $ 37,900 $ 37,050 Materials $ 548,500 $ 613,900 District Activities & Events $ 1,500 $ 1,200 Maintenance $ 402,537 $ 362,600 Non - Capital Equipment $ 34,100 $ 47,100 Office Expense $ 9,500 $ 7,500 Professional Development $ 10,900 $ 12,750 Travel & Conferences $ 4,150 $ 5,600 Utilities $ 90,800 $ 90,800 Vehicle Expense $ 367,150 $ 358,400 Supplies & Services Sub -Total $ 1,662,137 $ 1,714,600 Operations Budget Division Detail (FY 2014/15) Administration Division Primary GIL Category Category Sub Acct No./Sub Category I Sub Acct I Detail Item Description I Detail Amt I To 1-5010-0600-00 $30,000 1 -5010- 0600 -50 Total 30,000 Uniforms (District -wide) 30,000 Contractual Services Uniforms 1- 5010 -0710 -00 $12,000 1 -5010- 0710 -65 12,000 PPE Equipment 12,000 Materials PPE Equipment 1- 5010- 0715 -00 $1,200 1 -5010- 0715 -50 1,200 Meeting Supplies 1,200 District Activitiesand Events Meeting Supplies 1- 5010 -0750 -00 $15,000 1 -5010- 0750 -50 15,000 Safety Equipment (Regulatory Requirements) 15,000 Non - Capital Equipment Safety Equipment 1- 5010 -0760 -00 $7,500 1 -5010- 0760 -00 2,000 Misc Supplies 2,000 Office Expense Office Expense 1 -5010- 0760 -10 400 Paper 400 Paper 1 -5010- 0760 -20 2,000 Printer Ink 2,000 Printer Ink 1 -5010- 0760 -30 100 Manuals /Books /Magazines 100 Books & Publications 1- 5010 -0760 -40 3,000 Breakroom Supplies 3,000 Breakroom Supplies 1 -5010- 0810 -00 $700 1 -5010- 0810 -00 500 Training 500 Professional Development Professional Development 1 -5010- 0810 -40 200 Certificate Reimbursement 200 Certificate Reimbursement 1 -5010- 0830 -00 $1,200 1 -5010- 0830 -00 1,200 AWWAFall Conference 1,200 Travel & Conferences Travel & Conferences Section Total $67,600 Operation Budget Division Detail (FY 2014/15) Water Operation & Maintenance Division Rill gur, Imila 1- 5020 - 0645 -00 $21,600 1 -5020- 0645 -25 2,100 NPDES Deminimus(RWQCB) 2,100 fees& Permits NPDES /RWQCB 1- 5020 -0645 -45 14,000 Landfill (Orange County &Dan Coop) 14,000 Landfill (Orange County & Dan Copp) 1- 5020 -0645 -55 5,500 Encroachment Permits 5,500 Encroachment Permits 1- 5020 -0710 -00 $477,000 1- 5020 -0710 -05 27,500 Road Material 27,500 Materials Road Material 1- 5020 -0710 -13 3,000 Air -Vac parts 3,000 Ai r -Va c Parts 1- 5020 -0710 -15 18,000 Cla Valve Parts 18,000 Cla -Valve Parts 1- 5020 -0710 -25 75,000 Hydrant Repair Parts 75,000 Hydrant Re pa i r Pa its 1- 5020 - 0710 -30 65,000 Valve Repair Parts 65,000 Valve Repair Parts 1- 5020 -0710 -36 10,000 CityofYorba Linda Valve Adjustments 10,000 City of YL Valve Adjustments 1- 5020 -0710 -40 140,000 Replacement Meters 140,000 Replacement Meters 1- 5020 -0710 -50 10,000 MXU's 10,000 Replacement MXU 1- 5020 -0710 -55 9,000 Meter Boxes /Lids/Vaults 9,000 Meter Boxes /Lids/Vaults 1- 5020 -0710 -60 6,500 Hardware Supplies 6,500 Hardware Supplies 1- 5020 -0710 -81 1,500 Welding5upplies 1,500 Welding Supplies 1- 5020 -0710-85 7,000 Cleaning/Painting Supplies 7,000 Clea ning/Pa inting Supplies 1 -5020 -0710 -90 85,000 Water Service Repair Parts 85,000 Water Service Repair Parts 1- 5020 -0710 -94 12,000 Miscellaneous Warehouse Parts 12,000 Miscellaneous Warehouse 1 -5020 -0710 -96 2,500 Ready Mix Concrete 2,500 Ready Mix Concrete 1- 5020 -0710 -98 5,000 Landscape Supplies 5,000 Landscape Supplies 1- 5020 - 0730 -00 $190,300 1- 5020 -0730 -00 5,000 Maintenance 5,000 Maintenance Maintenance 1 -5020 -0730 -66 150,000 Asphalt Paving 150,000 Asphalt Paving 1- 5020 -0730 -67 35,000 Concrete Repair 35,000 Concrete Repair 1- 5020 -0730 -72 300 Safety Equipment Repairs 300 Safety Equipment Repairs 1 -5020- 0750 -00 $10,000 1- 5020 -0750 -15 500 Equipment Rental 500 Non - Capital Equipment Equipment Rental 1- 5020 -0750 -30 8,500 Tool & Equipment 8,500 Tool & Equipment 1- 5020 -0750 -50 1,000 Traffic Cones, Barricades, and Signs 1,000 Safety Equipment 1 -5020 -0810 -00 $7,500 1 -5020 -0810 -00 6,100 Training 6,100 Professional Development Professional Development 1- 5020 -0810 -40 1,400 Certificate Reimbursement 1,400 Certificate Reimbursement 1- 5020 -0830 -00 $2,000 1- 5020 -0830 -00 2,000 AWWASpring Conferences (5 employees) 2,000 Travel & Conferences Travel & Conferences Section Total $708,400 Operation Budget Division Detail (FY 2014/15) Sewer Operation & Maintenance Division Primary GIL category Category Tota I I Sub Acct No./Sub Category Sub Acct I Detail Item Description Detail 2 -5030 -0580 -00 $500 2 -5030- 0580 -00 Total 500 FOG Materials 500 Communications Communications 2- 5030 -0640 -00 $300 2 -5030- 0640 -00 300 CWEAMemberships 300 Dues, Memberships, Dues, Memberships, Subscriptions Subscriptions 2- 5030 -0645 -00 $4,000 2 -5030- 0645 -20 1,000 1,000 Fees & Permits FOG Inspection & Fees (OCSD) 2 -5030- 0645 -30 2,000 WDR - SSO(SWRCB) 2,000 WDR -SSO (SWRCB) 2 -5030- 0645 -55 1,000 Encroachment Permits 1,000 Encroachment Permits 2 -5030- 0710 -00 $35,900 2 -5030- 0710 -60 900 Hardware Supplies 900 Materials Hardware Supplies 2 -5030- 0710 -86 10,000 City ofYorba Linda Manhole Adjustments 10,000 Placentia/Yorba. Linda Island 2 -5030- 0710 -92 25,000 Sewer Main Repair Parts 25,000 Sewer Ma in Repair Parts 2 -5030- 0730 -00 $87,800 2 -5030- 0730 -59 60,000 Sewer Line Repairs 60,000 Maintenance Sewer Line Repairs 2 -5030- 0730 -65 7,000 Vector Control in Manholes 7,000 Vector Control In Manholes 2 -5030- 0730 -66 10,000 Asphalt Paving 10,000 Asphalt Paving 2 -5030- 0730 -67 500 Concrete Repair 500 Concrete Repair 2 -5030- 0730 -71 10,000 CCTVRepairs 10,000 CCTV Re pa i rs 2 -5030- 0730 -72 300 Safety Equipment Repairs 300 Safety Equipment Repairs 2 -5030- 0750 -00 $9,500 2 -5030- 0750 -30 8,500 Tools & Equipment 8,500 Non - Capital Equipment Tools & Equipment 2 -5030- 0750 -50 1,000 Traffic Cones, Barricades, and Signs 1,000 Safety Equipment 2 -5030- 0810 -00 $2,200 2 -5030- 0810 -00 1,800 PACP Training Course 1,800 Professional Development Professional Development 2 -5030- 0810 -40 400 Certificate Reimbursement 400 Certificate Reimbursement 2 -5030- 0830 -00 $1,200 2 -5030- 0830 -00 1,200 PACP Conference 1,200 Travel & Conferences Travel & Conferences 2 -5030- 0870 -00 $800 2 -5030- 0870 -10 800 800 Utilities Electric 2 -5030- 0890 -00 $56,100 2 -5030- 0890 -46 25,000 OPS -Sewer Vehicle Maint 25,000 Vehicle Expenses Vehicle Expense: Sewer 2 -5030- 0890 -47 1,000 OPS - Sewer - Equipment Maintenance 1,000 Vehicle Expense: Sewer 2 -5030- 0890 -48 9,100 OPS- Sewer -Gas 9,100 Vehicle Expense: Sewer Gas 2 -5030- 0890 -49 21,000 OPS - Sewer - Diesel 21,000 Vehicle Expense: Sewer Diesel Section Total $198,300 = -Lo ANNUAL OPERATING W Operation Budget Division Detail (FY 2014/15) Water Production Division Primary GL Category Category Total I Sub Acct No./Sub Category Sub Acct I Detail Item Description Detail 1 -5040- 0600 -00 $2,500 1 -5040- 0600 -25 Total 2,500 Distribution System Disinfection 2,500 Contractual Services Distribution System Disinfection 1 -5040- 0640 -00 $400 1 -5040- 0640 -00 400 AWWAMemberships 350 Dues, Memberships, Dues, Memberships, OCWAMemberships 50 Subscriptions Subscriptions 1 -5040- 0710 -00 $76,000 1 -5040- 0710 -17 4,000 Pump Parts 4,000 Materials Pump Repair Parts 1 -5040- 0710 -35 14,000 CL2 Parts 14,000 CL2 Parts 1 -5040- 0710 -60 2,500 Hardware Supplies 2,500 Hardware Supplies 1 -5040- 0710 -75 35,000 Salt 35,000 Salt 1 -5040- 0710 -84 20,000 Valves, Gauges, AV, etc. 20,000 Production Repair Parts 1 -5040- 0710 -85 500 Cleaning /Painting Supplies 500 Cleaning /PaintingSupplies 1 -5040- 0730 -00 $32,500 1 -5040- 0730 -05 4,500 CL2 System Service 4,500 Maintenance CL2 System Service 1 -5040- 0730 -10 5,000 Electrical Motor Repairs /Services 5,000 Electrical Motor Repairs 1 -5040- 0730 -20 10,000 Electric General Maintenance 10,000 Electrical General 1 -5040- 0730 -24 2,000 Reservoir Repairs 2,000 Reservoir Repairs 1 -5040- 0730 -25 6,000 Reservoir Inspections &Cleaning 6,000 Reservoir Inspections & Cleaning 1 -5040- 0730 -75 5,000 Pump Station Repairs 5,000 Pump Station Repairs 1 -5040- 0750 -00 $3,500 1 -5040- 0750 -30 1,000 Tools & Equipment 1,000 Non - Capital Equipment Tools & Equipment 1 -5040- 0750 -90 2,500 Hoses/ Fittings /Cabling for Pumps /Generators 2,500 Emergency Equipment Supplies 1- 5040 - 0810 -00 $2,100 1 -5040- 0810 -00 1,500 Training 1,500 Professional Development Professional Development 1 -5040- 0810 -40 600 Certificate Reimbursment 600 Certificate Reimbursement 1 -5040- 0830 -00 $1,200 1 -5040- 0830 -00 1,200 AWWA Spring Conference (2 Employees) 1,200 Travel & Conferences Travel & Conferences Section Total $118,200 Operation Budget Division Detail (FY 2014/15) Mechanical Services Division Primary GL Category Category Total Sub Acct No./Sub Category Sub Acct Detail Item Description Detail 1 -5050- 0645 -00 $9,950 1 -5050- 0645 -05 8,000 AQMD Permits 8,000 Fees& Permits AQMD Permits 1 -5050- 0645 -15 350 E.P.A. Fees 350 E.P.A.. Fees 1 -5050- 0645 -35 100 HAZ Mat Fees (OCFA) 100 Haz MatFees(OCFA) 1 -5050- 0645 -60 1,500 C.A.R.8 Fee 1,500 CARB Fees 1 -5050- 0710 -00 $4,000 1 -5050- 0710 -60 2,000 Hardware Supplies 2,000 Materials Hardware Supplies 1 -5050- 0710 -80 1,500 Mech. Shop Supplies 1,500 Mech. Shop Supplies 1 -5050- 0710 -81 500 Welding Supplies 500 Welding Supplies 1 -5050- 0750 -00 $8,000 1 -5050- 0750 -40 8,000 Misc Mech Shop Equipment /Tools 8,000 Non - Capital Equipment Mech Shop Equipment 1 -5050- 0810 -00 $250 1 -5050- 0810 -40 250 Certificate Reimbursment 250 Professional Development Certificate Reimbursement 1 Operation Budget Division Detail (FY 2014/15) Mechanical Services Division, Continued Primary GL Category Category Total Sub AcctNo./Sub Category Sub Acct 7- Total Detail Item Description Detail 1 -5050- 0890 -00 $302,300 1 -5050- 0890 -20 13,200 Finance -Gas 13,200 Vehicle Expenses Finance -Gas 1 -5050- 0890 -21 4,000 Finance - VehicleMaint 4,000 Finance - Vehicle Maint 1 -5050- 0890 -30 5,500 Engineering -Gas 5,500 Engineering -Gas 1 -5050- 0890 -31 2,000 Engineering - VehicleMaint 2,000 Engineering - Vehicle Maint 1 -5050- 0890 -42 50,000 OPSWaterVehicle Maintenance 50,000 OPS - Water - Vehicle Maint 1 -5050- 0890 -43 5,000 OPS -Water Equipment Maintenance 5,000 OPS - Water - Equipement 1 -5050- 0890 -44 63,000 OPS- Water -Gas 63,000 OPS- Water -Gas 1 -5050- 0890 -45 19,000 OPS- Water - Diesel 19,000 OPS- Water - Diesel 1 -5050- 0890 -50 2,000 OPS- ProductionVehicleMaint 2,000 OPS -Production Vehicle Maint 1 -5050- 0890 -51 500 OPS- Production EquipmentMaint 500 OPS- Production Equipment 1 -5050- 0890 -52 12,000 OPS- Production -Gas 12,000 OPS- Production -Gas 1 -5050- 0890 -53 2,000 OPSMechSvcs - VehicleMaint 2,000 OPS -Mech Svcs -Vehicle Maint 1 -5050- 0890 -54 4,200 OPS -Mech Svcs -Gas 4,200 OPS -Mech Svcs -Gas 1 -5050- 0890 -55 1,000 OPS- Facilities - VehicleMaint 1,000 OPS - Facilities - Vehicle Maint 1 -5050- 0890 -56 1,400 OPS- Facilities -Gas 1,400 OPS- Facilities -Gas 1 -5050- 0890 -57 1,000 OPS -Tool Repair 1,000 OPS -Too[ Re pair 1 -5050- 0890 -70 1,000 IT- Vehicle Maintenance 1,000 IT- Vehicle Maint 1 -5050- 0890 -71 3,000 IT-Gas 3,000 IT -Gas 1 -5050- 0890 -80 100,000 Stationary Engine Maint 100,000 Stationary Engine Maint 1 -5050- 0890 -81 11,000 Stationary Engine Emissions Testing 11,000 Stationary Engine Emissions 1 -5050- 0890 -90 1,500 Haz Mat Disposal 1,500 Hazardous Materials Disposal j Section Total $324,500 Operation Budget Division Detail (FY 2014/15) Facilities Maintenance Division Primary GL Category Category Total Sub Acct No./Sub Category Sub Acct Detail Item Description Detail 1 -5060- 0600 -00 $144,000 1 -5060- 0600 -05 25,000 AC & Heating 25,000 Contractual Services AC & Heating 1 -5060- 0600 -29 5,500 Disposal Service 5,500 Disposal Service 1 -5060- 0600 -35 65,000 Janitorial Service 65,000 Janitorial Service 1 -5060- 0600 -40 45,000 Landscape Service 45,000 Landscape Service 1 -5060- 0600 -45 3500 Pest Control Service 3,500 Pest Control Service 1 -5060- 0645 -00 $1,500 1 -5060- 0645 -35 1,500 Haz Mat Fees (OCFA), Permits 1,500 Fees & Permits Haz Mat Fees (OCFA) 1 -5060- 0710 -00 $9,000 1 -5060- 0710 -00 1,000 1,000 Materials Materials 1 -5060- 0710 -10 2,500 Building Repair Parts 2,500 Building Repair Parts 1 -5060- 0710 -60 3,000 Hardware Supplies 3,000 Hardware Supplies 1 -5060- 0710 -85 2,000 2,000 Cleaning /Painting Supplies 1 -5060- 0710 -98 500 Landscape Supplies 500 Landscape Supplies 1 -5060- 0730 -00 $52,000 1 -5060- 0730 -00 25,000 Misc Facility Maint (Doors, fences, etc.) 25,000 Maintenance Maintenance 1- 5060 - 0730 -20 5,000 Electrical Repair Work 5,000 Electrical General 1 -5060- 0730 -35 2,000 Fire ExtinguisherMaint /Calibration 2,000 Fire Extinguisher 1 -5060- 0730 -50 10,000 Painting 10,000 Painting& Fencing 1 -5060- 0730 -66 5,000 Asphalt Paving 5,000 Asphalt Paving 1 -5060- 0730 -67 5,000 Concrete Repair 5,000 Concrete Repair 1- 5060 - 0750 -00 $1,100 1 -5060- 0750 -00 100 General Tools and Parts 100 Non - Capital Equipment Non - Capital Equipment 1 -5060- 0750 -30 1,000 Tools & Equipment 1,000 Tools & Equipment 1 -5060- 0870 -00 $90,000 1 -5060- 0870 -10 90,000 Electric 90,000 Utilities I Electric Section Total $297,600 4� Supplies & Services Summary by Department FY 2014/15 Operations Department Board of Directors Information Technology Human Resources Finance Administration Engineering 185 Water Production Sewer Ops Water Ops Mechanical Svcs Facilities Maint. Administration VLM ANNUAL OPERATING BUDGET FISCAL' Appendix VLM ANNUAL OPERATING BUDGET FISCAL' List of Acronyms AAR — After Action Report ACP- Asbestos Cement Pipe ACWA- Association of California Water Agencies ACWA/JPIA- ACWA's Joint Powers Insurance Authority AF (af) - Acre Foot (1af = 325,851 gallons) AFY- Acre Feet per Year (rate of flow) AMP- Asset Management Plan AMS- Angle Meter Stop (Service shut off valve before the meter) AQMD- Air Quality Management District ASCE- American Society of Civil Engineers AWWA- American Water Works Association BEA- Basin Equity Assessment BMP- Best Management Practices BPP- Basin Production Percentage BPS- Booster Pump Station Brown Act- "Ralph M. Brown Act" enacted by the State Legislature governing all meetings of legislative bodies of local agencies CAFR- Comprehensive Annual Financial Report CALFED- The California and Federal Bay Delta Program. Addresses water management issues associated with the Bay Delta System CCR- Consumer Confidence Report ccf- 100 cubic feet (volume equal to approximately 748 gallons of water). Also used as one billing unit. Can also be known as "hcf' CDPH- California State Department of Public Health CEQA- California Environmental Quality Act CERCLA- Comprehensive Environmental Response, Compensation and Liability Act cf- cubic feet (volume equal to 7.48 gallons of water) CFR- Code of Federal Regulations cfs- cubic feet per second (rate of flow) CIP — Capital Improvement Project CIWQS- California Integrated Water Quality Systems COG — Continuity of Government COOP — Continuity of Operations COP — Critical Infrastructure Protection CORPs- United States Army Corps of Engineers CRWUA- Colorado River Water Users Association CSMFO- California Society of Municipal Finance Officers CUWA- California Urban Water Agencies CUWCC- California Urban Water Conservation Council CWEA- California Water Environment Association DIP- Ductile Iron Pipe VLM ANNUAL OPERATING BUDGET FISCAL' DO- Dissolved Oxygen DWR- Department of Water Resources (State) EMAC — Emergency Management Assistance Compact EOC — Emergency Operations Center EOP — Emergency Operations Plan ERP — Emergency Response Plan EPA- Environmental Protection Agency (Federal) ET- Evapotranspiration Rate (rate water evaporates off plants) ETOR- Employee Time Off Request ETWD- El Toro Water District FEMA- Federal Emergency Management Agency FOG- Fats Oils & Grease Program FTE- Full -Time Equivalent (number of employees) GFOA- Government Finance Officers Association GIS- Geographic Information System GPC- Gallons per Capita GPCD- Gallons per Capita per Day GPM- Gallons per Minute GPS- Global Positioning System GSWC- Golden State Water Company GW- Groundwater GWRS- Groundwater Replenishment System (OCWD Water Treatment System) HP- Horsepower (unit of mechanical energy) IC — Incident Commander ICS — Incident Command System IRWD- Irvine Ranch Water District IW- Import Water KW- Kilowatt (unit of electrical energy) KWh- Kilowatt -hour (rate of energy use or delivery) LBCWD- Laguna Beach County Water District MCL- Maximum Contaminant Level MCWD- Mesa Consolidated Water District Met- Metropolitan Water District of Southern California (aka MWD) MG- Million Gallons mg /I- Milligrams per liter (unit of concentration equivalent to ppm) MGD- Million Gallons per Day MNWD- Moulton Niguel Water District MOA — Memorandum of Agreement MOU — Memorandum of Understanding MWD- Metropolitan Water District of Southern California (aka Met) MWDOC- Municipal Water District of Orange County NIMS — National Incident Management System NPDES- National Pollutant Discharge Elimination Systems NRP — National Response Plan VLM ANNUAL OPERATING BUDGET FISCAL' NWS- National Weather Service OA — Operational Area OCSD- Orange County Sanitation District OCWD- Orange County Water District PIP- Performance Improvement Plan ppb- parts per billion ppm- parts per million ppt- parts per trillion PRS- Pressure Reducing Station (multiple PRV's usually in a vault) PRV- Pressure Reducing Valve REOC — Regional Emergency Operations Center RFP — Request for Proposal RO- Reverse Osmosis (treatment) RWQCB- Regional Water Quality Control Board (State) S. A.- Seasonally Adjusted SAR — Santa Ana River SCADA- Supervisory Control and Data Acquisition system SCWD- South Coast Water District SDWA- Safe Drinking Water Act (Federal) SEMS — Standardized Emergency Management System SMWD- Santa Margarita Water District SOC — State Operations Center SOP — Standard Operating Procedure SSMP -Sewer System Management Plans SSO- Sanitary Sewer Overflow SWP- State Water Project TCWD- Trabuco Canyon Water District tds- Total Dissolved Solids ug /1- Micrograms per liter (unit of concentration equivalent to ppb) USGS- United States Geological Survey (Federal) UV- Ultra - Violet Light Radiation (water treatment) UWMP- Urban Water Management Plan VCP- Vitrified Clay Pipe (sewer pipe) WDR- Waste Discharge Requirements (State) WEF- Water Environment Federation (counterpart to AWWA for the wastewater industry) WTP- Water Treatment Plant Glossary of Terms Accrual Basis of Accounting: The basis of accounting under which transactions are recognized when they occur, regardless of the timing of cash receipts and disbursements. Acre -Foot: The volume of water that will cover one acre to a depth of one foot. One acre equals 435.6 units or 325,850 gallons. Appropriation: A funding authorization made by the Board, which permits the District to incur obligations and to make expenditures of resources. Assets: Resources owned or held by the District that have monetary value Balanced Budget: Budgeted revenues are sufficient to cover all budgeted expenditures, principle payments on long -term debt, and minimum funding of all reserve requirements as required by the District's reserve policy. Bond: A written promise to pay a sum of money on a specific date or dates at a specified interest rate. The interest payments and the repayment of the principal are authorized in a District bond resolution. Common types of bonds are General Obligation (GO) bonds and Certificates of Participation (COPs). These are frequently used for construction of large capital projects such as buildings, reservoirs, pipelines and pump stations. California Society of Municipal Finance Officers (CSMFO): A statewide organization servicing all California municipal finance professionals whose purpose is to promote excellence in financial management through innovation, continuing education and the professional development of its members. Capital Budget: The portion of the annual budget that appropriates funds for the purchase of capital equipment items and capital improvements. These expenditures are separated from regular operating items, such as salaries and office supplies. Capital Equipment: Fixed assets such as vehicles, computers, furniture, technical instruments, equipment, etc. which have a life expectancy of more than 2 years and a value of greater than $5,000. Capital Expenditures: Expenditure on an item that meets the meets the District's $5,000 threshold for capitalization. Also referred to in the Budget as Vehicle and Equipment (See Capital Equipment) Capital Improvement: Expenses related to the construction, rehabilitation and modernization of District owned and operated infrastructure. Capital Replacement: Expenses related to major replacements of existing facilities or systems. Certificates of Participation (COP): A long -term debt instrument authorized for construction or acquisition of facilities and equipment. Debt: An obligation resulting from the borrowing of money or from the purchase of goods and services. These include bonds and accounts payables. Debt Service: The District's obligation to pay the principal and interest of bonds and other debt instruments according to a predetermined payment schedule. Deferred Revenue: Revenue that is not recognized in the period in which received because they are not "available" until a subsequent period. Depreciation: An expense recorded to allocate a tangible asset's cost over its useful life. Designated: A term that describes assets or equity set aside by action of the Board; as distinguished from assets or equity set aside in conformity with requirements of donors, grantors, or creditors. Enterprise Fund: Fund established to account for the financing of self- supporting enterprises, such as a utility fund, which render services primarily to the public. Expenditures /Expenses: A charge incurred, whether paid or unpaid, for operation, maintenance, interest, and other charges presumed to benefit the current fiscal period. Fiscal Year: A 12 -month period of time to which the annual budget applies and at the end of which a government determines its financial position and the results of its operations. The District has specified July 1 to June 30 as its fiscal year. Fund Balance /Fund Equity: See "Net Assets" Geographic Information System (GIS): A system combining computer hardware, software, and geographic data for collecting, storing, analyzing and displaying geographically referenced information. Generally Accepted Accounting Principles (GAAP): Accounting and financial reporting standards, conventions, and practices that have authoritative support from standards - setting bodies such as the Governmental Accounting Standards Board (GASB) and the Financial Accounting Standards Board.(FASB). Governmental Account Standards Board (GASB): National advisory board of accounting standards for public agencies. The Board identifies procedures, methods and standards for presenting the financial condition of public agencies. Government Finance Officers Association (GFOA): National organization whose purpose is to enhance and promote the professional management of governments for the public benefit by identifying and developing financial policies and best practices and promoting their use through education, training, facilitation of member networking, and leadership. Groundwater Replenishment Assessment: An assessment paid to Orange County Water District (OCWD) based upon the number of acre -feet of groundwater produced by the District. Infrastructure: The accumulated pipelines and storage facilities of the District, including meters, valves, pumps, filters and other appurtenances, whether constructed by the District or dedicated by private entities. Interest Income: Earnings from the investment portfolio. Liabilities: Present obligations of the District arising from past events. Locke Ranch Assessment: Charges for the Locke Ranch sewer system, which was transferred to the District in 1977. The assessment is imposed pursuant to authority in Water Code Section 31101.5 and adopted in accordance with the requirements of law. The current assessment is $66.00 per year for a residential or equivalent sewer connection and is collected on the Orange County tax roll. Net Assets: The difference between total assets and total liabilities. Increases or decreases in net assets may serve as a useful indicator of whether the financial position of the District is strengthening or weakening. Non - Capital Equipment: Hand tools, furniture and equipment costing $5,000 or less. Operating Budget: The portion of the budget that pertains to daily operations that provide basic district services. The operating budget contains appropriations for such expenditures as personnel, supplies, utilities, materials, travel and fuel, and does not include purchases of major capital plant or equipment which is budgeted separately in the Capital Budget. Operating Expenses: All costs associated with the day -to -day business of the District, which are not considered capital improvements or debt repayments. Purchased Import Water: All imported water obtained from Metropolitan Water District of Southern California (MWD) through the Municipal Water District of Orange County (MWDOC). QualServe: A voluntary quality improvement program designed exclusively for water and wastewater agencies. Refundinq Revenue Bond: A revenue bond is a long -term municipal debt instrument that is secured by a specified revenue source. A refunding revenue bond is a revenue bond that retires another bond before the first bond matures. Reserve Fund: The District maintains Reserve Funds per the District's policy for both designated and restricted balances. Designated Reserve Funds are "general use" funds designated by the Board. Restricted Reserve Funds are those that are legally set aside for a particular purpose due to a legal or contractual commitment and cannot be used for any other purpose. Revenue: Monies that the District receives as income. It includes such items as water sales and sewer fees. Estimated revenues are those expected to be collected during the fiscal year. Supervisory Control and Data Acquisition (SCADA): The system that collects operational data from remote units to monitor and control water and wastewater systems and facilities throughout the District service area. Sewer Fund: The fund established to account for the District's activities of wastewater collection and distribution to Orange County Sanitation District for treatment. Special District: An independent unit of local government organized to perform a single governmental function or a restricted number of related functions. Yorba Linda Water District is organized as a special district. = -LM ANNUAL OPERATING W Supplies and Services: The cost of items needed to support the accomplishment of the activities in a department's programs. Uncollectible Accounts: Includes the write -off of unpaid water and sewer charges. User Charge: A charge levied against users of a service or purchasers of a product. Variable Water Costs: Water costs based on a set price per unit but that varies on the quantity of units bought or produced. Variable water costs for the District are related to the quantity of import water that the District purchases and the quantity of ground water pumped from the wells. Vehicle and Equipment Outlay: Purchases of assets, such as vehicles, equipment and furniture, which cost over $5,000 each and are depreciated over their useful life. Water Fund: The fund established to account for the District's activities relating to the treatment and distribution of potable drinking water and non - potable water to its customers. Financial Policies Introduction The District's financial policy documents incorporate many of the District's financial management practices that are used by the District staff as guidelines for operational and strategic decision - making related to current and future financial matters. The purpose of establishing these policies is to identify acceptable and unacceptable courses of action, thus establishing parameters in which the District's fiscal performance can be reviewed. Some policies are flexible when they are utilized by District staff as performance measurement tools to monitor the District's finances, while others are restrictive to emphasize accountability. The Operating Budget Policy and Revenues and Expenditures Policy are internal documents, acting as a guideline for staff, and are not reviewed by the Board. The Financial Reserves Policy and Investment Policy are reviewed by District staff and Board Members annually, to accommodate minor changes to the existing policy or major shifts in financial priorities as approved by the District's Board of Directors. The District's financial policies encompass the following functional areas: • Operating Budget Policy • Revenues and Expenditures Policy • Financial Reserves Policy • Investment Policy = -LM ANNUAL OPERATING W Operating Budget Policy The operating budget policy answers some basic questions such as: How is the budget developed? Who is involved in the budget process? What does the budget include? Budget Development The District's budget is developed in accordance with the priorities which are linked to the District's financial and strategic plans set forth in the District's mission and long -term goals and objectives. These are found in the District's strategic plan, the needs of the community, and federal and state laws. Guidelines with respect to the District's budget are as follows: • The budget should support the District's mission statement, strategic goals, and critical priorities • There should be no deferment of critical maintenance • The budget should be regarded as a business operating plan • The budget should balance the needs to pay for the District's cost of providing services, debt service obligation and capital needs of the District • Expenses should be budgeted for in appropriate departments to correctly identify the cost of providing various District functions and services Budget Form The District operating and capital budget is developed on an annual basis. Operating and capital appropriations are approved by the District's Board of Director's. Proposed revenues and expenditures including debt service expenditures are presented to the Board of Directors along with comparisons to projected expenditures for the current year and actual expenditures of the prior two years. Basis of Budgeting The accounting for the District is kept on an accrual basis. Revenues are recognized when earned, and expenses are recognized when incurred. The budgeting for the District is kept on an accrual basis, with the exception of supplies & services, which are budgeted on a cash basis. The District is operated as an enterprise fund, which is an accounting entity that finances and accounts for the acquisition, operation and maintenance of governmental facilities and services. It is the District's intention to recover the full costs of supplying goods and /or services through user - charges. = —Lo ANNUAL OPERATING W The District's budget process was developed with a series of goals and objectives in mind. These goals and objectives are communicated throughout the organization through several meetings. During the process, the Board of Directors provides priorities and guidelines to the General Manager. The General Manager then discusses Board priorities and other future issues and concerns with Department Heads during staff meetings. Once goals and objectives for the upcoming year are identified, the General Manager and the District staff start developing the District's budget. Where practical, the District integrates performance measurement, service level, and productivity indicators in the District's adopted budget document. The District will continue to emphasize the importance of meeting each department's goals and objectives in order to accomplish its long -term goals and objectives. An increase in the Operating and Capital budget may result in water rate increases. In order to minimize the impact on the District's rates, revenue requirements are scrutinized to achieve operating efficiencies and maintain or increase customer service at the same time. As part of the cost containment efforts, District staff re- visits operating priorities and reviews internal procedures to included utilizing outside services when they can offer greater competitive advantages to doing it internally, or investing in technology to increase productivity and to reduce the need for additional staff. = -LO ANNUAL OPERATING W Revenues and Expenditures Policies This policy is used as an aid to provide for the consistent provision of essential public services since revenues and expenditures are the key drivers of the District's operations. The goal of this policy is to help ensure the financial stability regardless of the economic situation and to provide information to the Board that revenue and expenditure practices are consistent with the District's mission and goals. Revenues Policy Budgeted revenues are estimated conservatively using an objective and analytical approach using certain techniques such as historical trends and current information to maintain consistency, reliability, and reasonableness. User Charges User charges are the most important component of the District's revenue portfolio. The District uses user charges to fund the provision of services provided to its customers. The District utilizes a cost recovery component to determine how much costs need be recovered from various customers. The cost of providing various services is used as the basis for setting rates and fees to the various types of customers served. The following are guidelines for the user charge setting process: • User charges are established utilizing a generally accepted cost recovery methodology that is consistent and legally defendable using the following approaches: revenue requirement analysis, cost of service analysis, and rate design analysis. • Rate designs shall be reflective of the District's Board of Directors' rate setting objectives. • Rates shall be set at a level so that the District will collect reliable revenues through a combination of system access charges and users' commodity rates to pay for the District's revenue requirement. • Rates and charges will be reviewed and updated regularly based on factors such as the impact of inflation, other cost increases, the adequacy of the coverage of costs and requirements of the rate covenant. Expenditures Policy The District's expenditures reflect the Board of Directors' and staff commitment to serve present and future customers with reliable public services. The Board and Staff believe that prudent expenditure planning and accountability will ensure fiscal stability. = -LO ANNUAL OPERATING W Budgeted expenditures are projected conservatively using an objective and analytical approach as well as certain techniques such as historical trends, current information, and economic indicators to maintain consistency, reliability, and reasonableness. The basic components of the District's expenditure policies are broken down into two functional areas: Maintenance of Capital Assets and Review of Service Maintenance of Capital Assets Maintaining a reliable transmission and distribution system and a sustained capital program are simply not possible without reliable funding sources. For this reason, prudent financial planning is imperative to an effective capital improvement program. The District uses a combination of "pay as you go" method and long term funding to fund the District's capital improvement program and maintenance of its capital assets. A fixed annual amount was projected by an Asset Management Plan and is included in the District's Reserve Policy as an annual revenue requirement to be collected from rates and charges. The annual contributions then are accumulated and kept in the District's capital fund to be spent and withdrawn for the District's betterment and replacement projects over a period of time. The following elements of expenditure policy reflect the District's philosophy to perform ongoing maintenance of capital investments once they are purchased and capitalized: • Maintain consistency of allocation of resources for programs to carry out the District's mission and goals to its customers • Within the resources available each fiscal year, the District shall maintain capital assets and infrastructure at a satisfactory level to protect the District's investment, to minimize the future replacement and maintenance costs, and to continue service levels. Review of Service These expenditure policies are used by staff to prompt review of services to see if they are being provided as effectively and efficiently as possible. The District's review of service policy is as follows: • Utilize technology and productivity advancements that will help reduce or avoid increasing personnel costs, when practicable. • Control personnel costs as a proportion of total budget, to more productively and creatively use available resources. Financial Reserves Policy A. GENERAL POLICY: Maintaining adequate reserves is an essential part of sound financial management. The Yorba Linda Water District Board of Directors realizes the importance of reserves in providing reliable service to its customers, financing of long -term capital projects and funding availability for emergencies should the need arise. Interest derived from reserve balances shall be credited to the reserve account from which it was earned. B. CATEGORIES: YLWD shall accumulate, maintain and segregate its reserve funds into the following categories: Restricted and Designated Reserves 1. Board Designated Reserves; and 2. Contractually Restricted Reserves. C. SCOPE: This policy will assist the Board of Directors in establishing: 1. Target levels for reserve funds; 2. Requirements for the use of reserve funds; and 3. Periodic review requirements for each reserve. D. PERIODIC REVIEW: Staff and the YLWD Board shall review the reserve balances and targets annually as a part of the annual budget process. The Finance - Accounting Committee will continue to review all reserve and investment balances monthly, with a quarterly report going to the full Board. E. RESTRICTED AND DESIGNATED RESERVES: 1. Board Designated Reserves: These are reserve funds earmarked for the purpose of funding such items as new capital facilities, repair or replacement of existing facilities and general operating reserves designated for a specific purpose and use by the Board of Directors. 1.0 Operating Reserve A. Definition and Purpose — Established to cover temporary cash flow deficiencies that occur as a result of timing differences between the receipt of operating revenue and expenditure requirements and unexpected expenditures occurring as a result of doing business. B. Target Level — The Government Finance Officers Association (GFOA) recommends that funding should be no less than one to two months (or 8% - 17 %) of the District's annual operating budget. The District's current target will be a minimum of 8% and a maximum of 17% of the annual operating budget for both the water and sewer funds. C. Events or Conditions Prompting the Use of the Operating Reserve — This reserve may be utilized as needed to pay outstanding operating expenditures prior to the receipt of anticipated operating revenues. 1.1 Emergency Reserve A. Definition and Purpose — Established to provide protection recovery to the District and its customers for losses arising from an unplanned event or circumstance. The reserve level combined with YLWD's existing insurance policies should adequately protect YLWD and its customers in the event of a loss. B. Target Level — Established at a minimum level equal to $1,000,000 for the water fund and shall accumulate interest and annual contributions as determined by the District's annual operation to a maximum level of $4,000,000. The target for sewer will be a minimum of $250,000 and a maximum of $1,000,000. C. Events or Conditions Prompting the Use of the Emergency Reserve — This reserve shall be utilized to cover unexpected losses experienced by the District as a result of a disaster or other unexpected loss. Any reimbursement received by the District from insurance companies as a result of a submitted claim shall be deposited back into the reserve as replenishment for the loss. 1.2 Capital Replacement Reserve A. Definition and Purpose — Established to provide capital repair and replacement funding as the District's infrastructure deteriorates over its expected useful life. B. Target Level — The Board - approved 2010 Asset Management Plan recommended that the annual contribution to this reserve be at a minimum level of $1,820,000 for the water fund and $345,000 for the sewer fund, less money set aside for the Maintenance Reserve. Funding with available funds based on the District's operations shall be allocated quarterly. C. Events or Conditions Prompting the Use of the Capital Replacement Reserve — Through the annual budget process, staff shall recommend anticipated asset replacement projects. The Board of Directors shall take action to approve recommended project appropriations from the capital replacement reserve. Should unplanned replacement be necessary during any fiscal year, the Board of Directors may take action to amend the budget and appropriate needed funds as required. 1.3 Maintenance Reserve A. Definition and Purpose — Established to provide funding for non - scheduled capital asset repair and replacement. B. Target Level — $200,000 subject to an annual review. C. Events or Conditions Prompting the Use of the Maintenance Replacement Reserve — Unplanned failure of assets including but not limited to pumps, motors and major facility repairs. 1.4 Debt Service Reserve A. Definition and Purpose — Established to provide funding for semi - annually scheduled debt service payments. B. Target Level — The District's highest annual debt service payment — currently $2,723,509. C. Events or Conditions Prompting the Use of the Debt Service Reserve — Semi- annual debt service payments will be made out of this fund, with funding on the water rate replenishing the fund annually. 1.5 Employee Liabilities Reserve A. Definition and Purpose — The purpose is to cover employees' accrued vacation and other compensatory time and to ensure the complete funding associated with the liability incurred for employees whom have met the requirements necessary for district paid health benefits at retirement. B. Target Level — The annual contribution will be $100,000 ($93,000 for water and $7,000 for sewer) to be evaluated and /or adjusted annually thereafter based on an analysis of current employees' vacation and sick time accrued and actuarial determinations of future retiree costs. As of November 2, 2011, an actuary determined that the District's Other Post Employment Benefit (OPEB) liability was $1,433,197. When combined with a liability on the District's books for vacation, compensatory and sick time of $1,063,572 at June 30, 2012, the target is projected to be approximately $2,500,000 for the combined water and sewer enterprises. C. Events or Conditions Prompting the Use of the Employee Liabilities Reserve — This reserve may be used in the event that operating funds are not adequate to meet vacation, compensatory and sick time paid out or retiree medical cost obligations within the current year. 2. Contractually Restricted Reserves: These are funds held to satisfy limitations set by external requirements established by creditors, grant agencies or law. Examples include stipulated bond covenants and reserves held with a fiscal agent. 2.0 US Bank 2008 COP Reserve A. Definition and Purpose — Established to cover reserve requirements held with a designated fiscal agent (US Bank) for the 2008 Certificates of Participation. B. Target Level — Funding shall be held in an amount equal to $2,147,096. C. Events or Conditions Prompting the Use of the Contractually Restricted Reserve — This reserve may be utilized as needed by the fiscal agent to pay any outstanding debt service payments not covered by the District within the specified billing and due dates. C0M&YK91:j=F This policy will assist the Board of Directors in establishing: 4. Target levels for reserve funds; 5. Requirements for the use of reserve funds; and 6. Periodic review requirements for each reserve. D. PERIODIC REVIEW: Staff and the YLWD Board shall review the reserve balances and targets annually as a part of the annual budget process. The Finance - Accounting Committee will continue to review all reserve and investment balances monthly, with a quarterly report going to the full Board. N*31N 10 9=1 I7_ 1► oil 11*1[r1► /_1%I =11N=6*1=1:ITA26" a 1. Board Desianated Reserves: These are reserve funds earmarked for the purpose of funding such items as new capital facilities, repair or replacement of existing facilities and general operating reserves designated for a specific purpose and use by the Board of Directors. N L z Nt. , .ANNUAL OPERATING �. W Investment Policy SECTION 1: GENERAL POLICY 1.1 It is the policy of the Yorba Linda Water District ( "District ") to invest public funds in a manner which ensures the safety and preservation of capital while meeting reasonably anticipated operating expenditure needs, achieving a reasonable rate of return and conforming to all state and local statutes governing the investment of public funds. 1.2 The purpose of this policy is to provide guidelines for the prudent investment of funds of the District and to outline the policies for maximizing the efficiency of the District's cash management. The District's goal is to enhance the economic status of the District consistent with the prudent protection of the District's investments. This investment policy has been prepared in conformance with all pertinent existing laws of the State of California. SECTION 2: SCOPE 2.1 This Investment Policy applies to all funds and investment activities of the District, except for the proceeds from capital project financing instruments, which are invested in accordance with provisions of their specific documents. These funds are accounted for as Enterprise Funds and are identified in the District's Comprehensive Annual Financial Report. SECTION 3: DELEGATION OF AUTHORITY 3.1 The authority of the Board of Directors to invest funds is derived from Section 53601 of the California Government Code ( "CGC "). Section 53607 of the CGC grants the Board of Directors the authority to delegate that authority, for a one - year period, to the District's Treasurer. Therefore, management responsibility for the investment program is hereby delegated to the District's Treasurer, who shall be responsible for all transactions undertaken and shall establish a system of controls to regulate the activities of subordinate officials and their procedures in the absence of the Treasurer. The Treasurer shall establish procedures for the management of investment activities, including the activities of staff consistent with this Policy. LM = z - ANNUAL OPERATING . 3.2 The Treasurer may retain the services of an outside investment advisor or manager as approved by the Board to assist with the District's investment program. Any investment advisor selected shall make all investment decisions and transactions in strict accordance with State law, and this Policy. SECTION 4: INVESTMENT OBJECTIVES 4.1 The primary objectives, in priority order, of the District's investment activities shall be: 4.1.1 Safety: Safety and preservation of principal is the foremost objective of the investment program. Investments shall be selected in a manner that seeks to ensure the preservation of capital in the District's overall portfolio. This will be accomplished through a program of diversification and maturity limitations, more fully described in Section 13, in order that potential losses on individual securities do not exceed the income generated from the remainder of the portfolio. 4.1.2 Liquidity: The District's investment portfolio will remain sufficiently liquid to enable the District to meet all operating requirements which might be reasonably anticipated. Securities should mature concurrent with cash needs to meet anticipated demands. 4.1.3 Return on Investments: The District's investment portfolio shall be designed with the objective of attaining the best yield or returns on investments, taking into account the investment risk constraints and liquidity needs. Return on investment is of secondary importance compared to the safety and liquidity objectives. SECTION 5: PRUDENCE 5.1 The standard of prudence to be used by the designated representative shall be the "prudent investor" standard and shall be applied in the context of managing the overall portfolio. The meaning of the standard of prudent investor is explained in CGC Section 53600.3, which states that "when investing, reinvesting, purchasing, acquiring, exchanging, selling or managing public funds, a trustee shall act with care, skill, prudence, and diligence under the circumstances then prevailing, including, but not limited to, the general economic conditions and the anticipated needs of the agency, that a prudent person acting in a like capacity and familiarity with those matters would use in the conduct of "�. ANNUAL OPERATING �. W funds of a like character and with like aims, to safeguard the principal and maintain the liquidity needs of the agency." 5.2 The Treasurer and delegated investment officers, acting in accordance with District procedures and the Policy and exercising due diligence, shall be relieved of personal responsibility for an individual security's credit risk or market price changes, provided deviations from expectations are reported in a timely fashion and appropriate action is taken to control adverse developments. 5.3 Investments shall be made with judgment and care - under circumstances then prevailing - which persons of prudence, discretion and intelligence exercise in the management of their own affairs, not for speculation, but for investment, considering the probable safety of their capital as well as the probable income to be derived. SECTION 6.0: ETHICS AND CONFLICTS OF INTEREST 6.1 Officers and employees involved in the investment process shall refrain from personal business activity that could conflict with proper execution of the investment program, or which could impair their ability to make impartial investment decisions. Employees and investment officials shall disclose to the District's General Manager any material financial interests in financial institutions that conduct business with the District's boundaries, and they shall further disclose any large personal financial /investment positions that could be related to the performance of the District. SECTION 7: AUTHORIZED BROKER /DEALERS 7.1 The Treasurer will maintain a list of authorized broker /dealers and financial institutions that are approved for investment purposes. Broker /dealers will be selected for credit worthiness and must be authorized to provide investment services in the State of California. These may include "primary" dealers or regional dealers that qualify under Securities & Exchange Commission Rule 15(C)3 -1 (uniform net capital rule). No public deposit will be made by the broker /dealer except in a qualified public depository as established by the established state laws. Before a financial institution or broker /dealer is used, they are subject to investigation and approval by the Treasurer or his /her designated representative, and must submit the following: 7.1.1 Certification of having read and understood this investment policy resolution and agreeing to comply with the District's investment policy; = L ANNUAL OPERATING W 7.1.2 Proof of Federal Investment Regulatory Authority certification; 7.1.3 Proof of State of California registration; 7.1.4 Audited financial statements for the institution's three (3) most recent fiscal years; 7.1.5 References of other public- sector clients that similar services are provided to. 7.2 If a third party investment advisor is authorized to conduct investment transactions on the District's behalf, the investment advisor may use their own list of approved independent broker /dealers and financial institutions. The investment advisor's approved list must be made available to the District upon request. SECTION 8: AUTHORIZED INVESTMENTS 8.1 The District is provided a broad spectrum of eligible investments under the CGC Sections 53601 et seq. Authorized investments shall also include, in accordance with CGC section 16429.1 et seq., investments into the Local Agency Investment Fund (LAIF) and the Orange County Treasurer's Commingled Investment Pool in accordance with CGC section 53684. Within the investments permitted by the CGC, the District seeks to further restrict eligible investment to the investments listed in Section 8.3 below. Percentage holding limits listed in this section apply at the time the security is purchased. Ratings, where shown, specify the minimum credit rating category required at purchased without regard to +/- or 1,2,3 modifiers, if any. 8.2 The purchase of any investment permitted by the CGC, but not listed as an authorized investment in this Policy is prohibited without the prior approval of the Board of Directors. 8.3 Within the context of these limitations, the following investments are authorized: = —Lo ANNUAL OPERATING W TABLE 1 * Please see Appendix A for more detailed descriptions and additional restrictions ^ Please see Section 10 for additional restrictions 4 Please see Section 11 for additional restrictions CA Government Code YLWD Permitted Investments * / % of Portfolio Limits / % of Portfolio Limits / Deposits Maturity Limits Maturity Limits Bank Deposits# No % limit, 5 years No % limit, 5 years CD Placement Service# 30% limit, 5 years 30% limit, 5 years Local Agency Investment Fund No % or maturity limit No % or maturity limit (LAIF)" County Pooled Investment Fund SA No % or maturity limit No % or maturity limit Joint Powers Authority Funds No % or maturity limit No % or maturity limit (CaITRUST & CAMP)^ U.S. Treasury Obligations No % limit, 5 years No % limit, 5 years U.S. Agency Obligations No % limit, 5 years No % limit, 5 years Negotiable Certificates of Deposit# 30% portfolio, 5 years 30% portfolio, 5 years Money Market Funds* 20 %, 10% per issuer, no limit 20 %, 10% per issuer, no limit Medium -Term (or Corporate) Notes* 30% portfolio, 5 years 30% portfolio, 5 years Bankers Acceptances* 40 %, 30% per issuer, 180 10% max, 5% per issuer, 180 days days Commercial Paper* 25 %, 10% per issuer, 270 25% max, 5% per issuer, 270 days days * Please see Appendix A for more detailed descriptions and additional restrictions ^ Please see Section 10 for additional restrictions 4 Please see Section 11 for additional restrictions SECTION 9: REVIEW OF INVESTMENT PORTFOLIO 9.1 The securities held by the District must be in compliance with Section 8 Authorized Investments at the time of purchase. The Treasurer shall at least quarterly review the portfolio to verify that all securities are in compliance with Section 8 Authorized Investments. In the event a security held by the District is subject to a credit rating change that brings it below the minimum credit ratings specified in Appendix A Authorized Investments, the Treasurer should notify the Finance - Accounting Committee - and through the Committee's minutes, the Board - of the change. The course of action to be followed will then be decided on a case -by -case basis, considering such factors as the reason for the change, prognosis for recovery or further rate drops, and the market price of the security. SECTION 10: INVESTMENT POOLS 10.1 A thorough investigation of any investment pool or mutual fund is required prior to investing, and on a continual basis. The investigation will, at a minimum, obtain the following information: 10.1.1 A description of eligible investment securities, and a written statement of investment policy and objectives; 10.1.2 A description of interest calculations and how it is distributed, and how gains and losses are treated; 10.1.3 A description of how the securities are safeguarded (included the settlement processes), and how often the securities are priced and the program audited; 10.1.4 A description of who may invest in the program, how often and what size deposit and withdrawal are allowed; 10.1.5 A schedule for receiving statements and portfolio listings; 10.1.6 Are reserves, retained earnings, etc. utilized by the pool /fund; 10.1.7 A fee schedule and when and how it is assessed; 10.1.8 Is the pool /fund eligible for bond proceeds and /or will it accept such proceeds. ANNUAL OPERATING W SECTION 11: COLLATERALIZATION 11.1 Bank Deposits: Under provisions of the CGC, California banks and savings and loan associations are required to secure the District's deposits by pledging eligible securities with a value of 110% of principal and accrued interest. State law also allows financial institutions to secure District deposits by pledging first trust deed mortgage notes having a value of 150% of the District's total deposits. 11.2 Waiver of Security: The Treasurer, at his /her discretion and in accordance with CGC section 53653, may waive security for the portion of any deposits as is insured pursuant to federal law. SECTION 12: SAFEKEEPING AND CUSTODY 12.1 All security transactions entered into by the District shall be conducted on a delivery- versus - payment basis. Securities will be held by a third party custodian designated by the Treasurer and evidenced by safekeeping receipts. The only exception to the foregoing shall be depository accounts and securities purchases made with (i) local government investment pools, and (ii) money market mutual funds, since those purchased securities are not deliverable. SECTION 13: DIVERSIFICATION AND MAXIMUM MATURITIES 13.1 The District will diversify its investments by security type and institution. With the exception of U.S. Treasuries, U.S. Agency Securities, FDIC Insured Certificates of Deposit and authorized pools, no more than 30% of the District's total investment portfolio will be invested in a single security type or with a single financial institution. 13.2 To the extent possible, the District will attempt to match its investments with anticipated cash flow requirements. Unless matched to a specific cash flow and approved in advance by the Board of Directors, the District will not directly invest in securities maturing more than 5 years from the date of purchase. SECTION 14: INTERNAL CONTROLS 14.1 The external auditors will annually review the investments and general activities associated with the investment program. This review will provide internal control by assuring compliance with the Investment Policy and District policies and procedures. = -LM ANNUAL OPERATING W SECTION 15: PERFORMANCE STANDARDS 15.1 The investment portfolio will be designed with the objective of obtaining a rate of return throughout budgetary and economic cycles, commensurate with the investment risk constraints and the cash flow needs. 15.2 The District's investment strategy is passive. The performance of the District's investment portfolio will be evaluated and compared to an appropriate benchmark in order to assess the success of the investment portfolio relative to the District's Safety, Liquidity and Return on Investments objectives. This review will be conducted annually with the Finance - Accounting Committee. SECTION 16: REPORTING 16.1 Subject to CGC sections 53607 and 53646(b), the Treasurer will provide monthly investment reports to the District's Finance - Accounting Committee (and through the Committee's minutes, to the Board of Directors) and quarterly reports to the Board of Directors which provide a clear picture of the status of the current investment portfolio. The reports shall comply with the reporting requirements of CGC sections 53607 and 53646(b), respectively. SECTION 17: INVESTMENT POLICY ADOPTION 17.1 The District's Investment Policy will be adopted by resolution of the Board of Directors. The policy will be reviewed on an annual basis and modification, if any, must be approved by the Board of Directors.