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Home My WebLink About2018-10-08 - Board of Directors Meeting Agenda Packet AGENDA YORBA LINDA WATER DISTRICT BOARD OF DIRECTORS WORKSHOP MEETING Monday, October 8, 2018, 4:30 PM 1717 E Miraloma Ave, Placentia CA 92870 1. CALL TO ORDER 2. PLEDGE OF ALLEGIANCE 3. ROLL CALL Al Nederhood, President Brooke Jones, Vice President Andrew J. Hall, Director Phil Hawkins, Director J. Wayne Miller, Director 4. PUBLIC COMMENTS Any individual wishing to address the Board is requested to identify themselves and state the matter on which they wish to comment. If the matter is on the agenda, the Board will recognize the individual for their comment when the item is considered. No action will be taken on matters not listed on the agenda. Comments are limited to matters of public interest and matters within the jurisdiction of the Water District. Comments are limited to three minutes. 5. DISCUSSION ITEMS This portion of the agenda is for matters that cannot reasonably be expected to be concluded by action of the Board of Directors at the meeting, such as technical presentations, drafts of proposed policies, or similar items for which staff is seeking the advice and counsel of the Board of Directors. Time permitting, it is generally in the District’s interest to discuss these more complex matters at one meeting and consider formal action at another meeting. This portion of the agenda may also include items for information only. 5.1. 5-Year Forecast of District's Operating Budget (Materials to be provided at the meeting.) 6. ADJOURNMENT 6.1. The next Regular Board of Directors Meeting is scheduled Tuesday, October 9, 2018. Closed Session will begin at 6:00 p.m. and regular business at 6:30 p.m. Items Distributed to the Board Less Than 72 Hours Prior to the Meeting Pursuant to Government Code section 54957.5, non-exempt public records that relate to open session agenda items and are distributed to a majority of the Board less than seventy-two (72) hours prior to the meeting will be available for public inspection in the lobby of the District’s business office located at 1717 E. Miraloma Avenue, Placentia, CA 92870, during regular business hours. When practical, these public records will also be made available on the District’s internet website accessible at http://www.ylwd.com/. Accommodations for the Disabled Any person may make a request for a disability-related modification or accommodation needed for that person to be able to participate in the public meeting by telephoning the Executive Secretary at 714-701-3020, or writing to Yorba Linda Water District, P.O. Box 309, Yorba Linda, CA 92885-0309. Requests must specify the nature of the disability and the type of accommodation requested. A telephone number or other contact information should be included so the District staff may discuss appropriate arrangements. Persons requesting a disability-related accommodation should make the request with adequate time before the meeting for the District to provide the requested accommodation. BACKUP MATERIALS DISTRIBUTED LESS THAN 72 HOURS PRIOR TO THE MEETING September 13, 2018 5 Year Budget Workshop Goal: to produce a 5 year Budget plan with our GFOA submission for the Distinguished Budget Presentation Award NLT September 20, 2018. Background: previously we submitted to the rating agencies and bond buyers our Preliminary Official Statement, and then our Official Statement. Due to improved efficiencies, and above-predicted revenue receipts, our financial picture has changed for the better. We have literally spent hundreds of hours working on this 5 year budget to get it to today’s workshop. Concurrently we worked with Andrew Gagen and with Raftelis Financial to determine the appropriate amount and use of pass through costs. Staff started with: 1. our approved Operational and Maintenance Budget for FY19 2. the Rating Agencies metrics 3. our Reserve Policy target balances 4. our PERS and OPEB liability targets 5. no CIP Then we determined our pass-through amount eligible to apply. Next we scrubbed the CIP projects and Equipment Purchase Program to determine priorities, and to balance implementation with: staff availability, future grant opportunities, and to smooth cash flow to avoid irregular rate increases. One project NOT included is the potential PFAS treatment plant. Should it become necessary we will recommend debt-funding, and recovering costs as a new, separate line fee on each bill to cover construction and operational costs (if not recovered from OCWD). We then plugged in the critical CIP projects and rough cost estimates per the Asset Management Plan, real world risk analysis, and opportunity to succeed. In the upcoming slide of CIP Projects, all that have changed since the June Workshop will be noted in red text. We also determined which CIP would likely be debt service funded, and which were PAYGO in order to accurately reflect funding needs. The result is a staff plan for GFOA submission for future 5-year budget requirements that include pass- through costs, minimal base fee increases to fund Capital Improvements (after anticipated cost savings such as pumping a higher percentage of groundwater), and meet all rating agency and bond metrics. Finally, this is NOT a one and done 5 year plan; rather it is a process with annual updates to accommodate our changing situation. With State imposed Water Budgets, continued drought, increased regulatory requirements, changing legislation, etc., change is our new normal. Brett will guide you through this presentation. MATERIALS SUBMITTED BY: Marc Marcantonio MEETING DATE: October 8, 2018 ITEM NO. 5.1. ITEM NO. 5.1. • ® Yorba Linda Water District - 5 YEAR BUDGET PROJECTION MATERIALS SUBMITTED BY: Brett Barbre MEETING DATE: October 8, 2018 There are known kn o wns; there are things we know that we know. There are known unknowns; that is to say, there are things that we now know we don't know. `"'"'"rte-` ;�► But there are also unknown unknowns - there ; are things we do not know we don't know. -Donald Rumsfeld 400or z Known knowns Fitch Ratings Surveillance ( November 2017) 1. FY21 — increase growth for customer accounts 2. Service charges reflect projected revenue increases attributed to the monthly capacity charge of —12% in FY19 and FY20 and revenue increases attributed to growth of —1% in FY21 and FY22. 3. Variable water costs in FY18 account for additional in-lieu water purchased from MWDOC. FY19-FY22 reflects expenses of OCWD groundwater and MWDOC purchases. 4. District contributes —$1.4 million annually starting FY19 to fund the Pension and OPEB Liability. 5. Total debt service includes Series 2012A and 2017A debt service payments. t CU � N .0 •v � Z Q U N •� ul ` O •� •L (1) cv ._ 0 '� W O 4-J U • T Q W 2 Q.. V) a- • • • • • • .A t � r � ,r /r �� 1 Absorptions • 2 refunds Annexation Fee to OCWD ■ August 2017: $1.11 FY18: $369,257 ■ December 2017: $1.11 FY17: $319,983 ■ FY16: $350,092 • Pass-through (MWDOC/OCWD) FY15: $72,088 ■ FY17 to FY18: $895,514 (10C/unit) ■ FY16 to FY17: $1,736,867 (22C/unit) Regulatory requirements ■ FY15 to FY16: $444,348 (6C'/unit) Water Quality testing ■ • Energy costs Legislative mandates ■ FY18: $1,254,202 OPEB Liability ■ FY17: $1,320,943 ■ $247,000 in FY18 ■ FY16: $1,212,282 ■ $1.51M proposed in FY19 ■ FY15: $1,482,604 5 Efficiencies IQ • Meet with SCE annually 213 IS ; D to determine best rate .y schedules ■ No changes were identified this past year • Fairmont Booster Pump • Increased BPP (OCWD Annexation ) Station ■ $1. 18M (savings minus energy and treatment costs) ■ Operational savings • 5-Year MOU with Employee Association opportunities ■ Legal Fees: $42,000 ■ Staff Time Ne Efficiencies213 • Leak detection program � � , resulted in cost savings of more than $340,000 since 2015 • Minimizing paving costs by actively • Not cleaning dean sewers coordinating with Authorities Having • Utilize CCTV to identify Jurisdiction (AHJ ) condition of sewers • Reduced 0&M cost by • Conducting detailed analysis decommissioning several PRS facilities of Asset Management Plan • Well 22 Drilling Project; saved $160,000 Reserve PolicyTargets a n d RatingAgencies ' Metrics to Maintain AA Debt Covenant Ratio 2.25 365 Equivalent to $29 million each 1.25 Contractual Days of Cash year in unrestricted reserves. ppppp- Rates must reflect cost of service. Rate RetainAA/ ratings from May lead to rate increase or Adjustment strong decrease. AA+ rating agencies. hhhhh'- 8 WATER MODEL: Variables Known Unknowns O&M OPEB/PERS CIP& Capital Pass-through POTENTIAL Budget Unfunded Liability Equipment RATE ADJUSTMENT time 7-12,2016 1-6,2017 7-12,2017 1-6,2018 Pass -through Costs WHOLESALE PASSTHROUGHS OCWD $ 402 $ 402 $ 445 $ 445 10C for FY19 CUP CUP MWDOC $ 942 $ 979 $ 979 $ 1,015 Capacity Charge $ 103,590 $ 103,590 $ 53,502 Readiness-to-Serve $ 275,970 $ 226,518 $ 185,094 $ 194,766 Meter Charge $ 10.50 $ 10.95 $ 11.90 $ 11.90 Pass-through must be IN-Lieu $ 533 $ 533 calculated at the end of PRODUCTION&RETAIL VOLUME(DEMAND) OCWD,AF 7884.1 6361.2 5261.8 6176.7 the fiscal year, based on CPTP,AF MWDOC,AF 3379.2 2691.1 3379.2 2691.1 actual expenditures. In-Lieu,AF 2622.3 184.5 #of meters 24904 25021 RETAIL CONSUMPTION,CCF 4,411,186 3,009,795 4,411,186 3,009,795 TOTAL OCWD $ 3,169,408.20 $ 2,557,202.40 $ 2,341,501 $ 2,748,632 CPTP Does NOT include : MWDOC $ 3,183,206.40 634,586.90 $ 3,308,237 $ 2,731,467 Capacity Charge $ 130,290.84 $ 103,280 $ 103,280 $ 53,504 Readiness-to-Serve $ 275,970 $ 226,515 $ 172,717 $ 194,764 • Energy increases Meter Charge $ 262,721 $ 273,980 $ 297,750 $ 297,750 IN-Lieu $ 1,397,686 $ 98,339 • OCWD Annexation fee $ 7,021,596 $ 5,795,564 $ 7,621,171 $ 6,124,455 $ 12,817,160 $ 13,745,625 L FY17 to FY18 EWD $ 92§405.diffq.e ce .eA8 9,475 total CCt'v its) • $ 0.10 per CCF 10 Changes to CommodityCharge from Pass -through PercentFISCAL YEAR Pass-through BASE CHARGE.. IN EFFECT • effective Change Current -- $2.70 -- FY19 $0.10 (actual) $2.80 3.70% FY20 $0.12 $2.92 4.29 FY21 $0.08 $3.00 2.74% FY22 $0.10 $3.10 3.33 FY23 $0.09 $3.19 2.90% FY1L9 pass-through is actual calculated water supply costs. FY20 and onward are projections. 11 NO C ................. .................. ......... 12 Water Reven u e Adjustments&Coverage Chart Millions Total Water Reserve Ending Balances 10020 - ........ ........ 5000 $50 — 802'0 ; 196% 300%'0 $40......................... .:. ...142% ... .;....100:5, 60`1`0 $30 4690 100%5 r 40% I -1001% $20 ... 2020 3000 $10 0.0% 0.--% --.0°"6 D.D96 0.04 0. `.a ovo -500v0 } $o Rev AdJ FY 2018 FY 2019 FY 2020 FY 2021 FY 2022 FY 2D23 Cowage FY 2018 FY 2019 FY 202D FY 2D21 FY 2022 FY 2023 Rev Adjustment Coverage Ratio right axis -4 Days in Cash Value Proposed Min Balances Proposed Target Balances Requred Coverage-125%'0 a Alert Coverage Target Debt Covera e-225%'0 0 Alert Balances ......Existing Min Balanoes 31 • . • • • _ Adh {Nater Reven u e Adjustments&Coverage Chart Millions Total Water Reserve Ending Balances $50 80Y'a 222! 208%....,........18OVo 300% $40 60Y`a 100% $3U � 40% -1001% $20 ..... � ..... � ..... ... 20% — 300% $10 0.0% 0.--% _-.01116 D.D96 0.04 0. Ya 0% -500YO $0 Rev AdJ FY 2018 FY 2019 FY 2020 FY 2021 FY 2022 FY 2D23 Cowage FY 2018 FY 2019 FY 2020 FY 2021 FY 2022 FY 2023 Rev Adjustment Coverage Ratio right axis Days in Cash Value Proposed Min Balances Proposed Target Balances Required Coverage-125%6 a Alert Coverage Target Debt Covera e-225 o Alert Balances ......Existing Min Balances 14(1 • . • • • _ Ah Adh Ah • . . • _ _ _ {Nater Reven u e Adjustments&Coverage Chart Millions Total Water Reserve Ending Balances 5% — 500% $50 4% 300%'0 $40 ........................................................................................... 3% 100% $30 2% — -1001% $20 14'0 3000 $10 0`Yo -500Y/0 $0 Rev AdJ FY 2013 FY 2019 FY 2020 FY 2021 FY 2022 FY 2D23 Cowage FY 2019 FY 2019 FY 2020 FY 2021 FY 2022 FY 2023 Rev Adjustment —Coverage Ratio right axis Days in Cash Value Proposed Min Balances Proposed Target Balances Required Coverage-125% ■ Alert Coverage Target Debt Covera e-225% o Alert Balances ......Existing Min Balances 15(1 June CIP Workshop • Based on Asset Management Plan • Staff identified projects • FY19-23: $39,812,440 16 1�ater CIP and Funding Sources oil 17 FY X018 F � 2�2r3 F1f 2r�21 FY 222 FY ��2� ■ Qebt Funded ■ PAYGfl ■Total CIP Water Reven u e Adjustments&Coverage Chart Millions Total Water Reserve Ending Balances 15% ........ ........ $40 – ........ ........ 50OYo $30 . 196 10% 196% 1�2°� 30DIo .. .. ... ..100%,. .... $20 .. $ .�. ... ...... ... 45% 11 100 $10 5% — -100% $0 $0 -3009ro -$10 0.0% 0.--w D.D96 o.04 0–�w 0% -5000 _$20 Rev AdJ FY 2013 FY 2019 FY 2020 FY 2021 FY 2022 FY 2D23 Coverage FY 2019 FY 2019 FY 2020 FY 2021 FY 2D22 FY 2023 Rev Adjustment Coverage Ratio right axis Days in Cash Value Proposed Min Balances Proposed Target Balances Required Coverage-125% a Alert Coverage Target Debt Covera e-225% 0 Alert Balances ......Existing Min Balances 118 As 9 • • • {Nater Reven u e Adjustments&Coverage Chart Millions Total Water Reserve Ending Balances 15% ............. $40 ........ ........ 50OYo , $30 101/0 221 207% 180% 30OYo ; 100 5% — -100% $10 $7 - 3 -3009ro 50 � 0.0% 0.--% -_.01116 D.D96 0.04 O.E% 0% -500% $10 Rev AdJ FY 2013 FY 2519 FY 2025 FY 2021 FY 2022 FY 2523 Coverage FY 2018 FY 2019 FY 2020 FY 2021 FY 2522 FY 2023 Rev Adjustment Coverage Ratio right axis Days in Cash Value Proposed Min Balances Proposed Target Balances Required Coverage-125% a Alert Coverage Target Debt Covera e-225% 0 Alert Balances ......Existing Min Balances 119 Water Reven u e Adjustments&Coverage Chart Millions Total Water Reserve Ending Balances 50Yo — $40 50OYo $35 40Yo . 30DIo $30 30`1`0 .. .......... ................... ..... ... $25 100 $20 20% ...... ...... ........ .... 12.0% 12.0% -100YO $15 1�° -30OYo $10 $5 — 0`Yo -5000 $0 Rev AdJ FY 2013 FY 2019 FY 2020 FY 2021 FY 2022 FY 2D23 Coverage FY 2019 FY 2019 FY 2020 FY 2021 FY 2022 FY 2023 Rev Adjustment —Coverage Ratio right axis Days in Cash Value Proposed Min Balances Proposed Target Balances Required Coverage-125%'0 ■ Alert Coverage Target Debt Covera e-225% 0 Alert Balances ......Existing Min Balances 0 Revenue Needed JUNE CIP WORKSHOP; YEARLY REVENUE NEE^rl^ $14,000,000 $11,204,158 $11,974,252 $12,000,000 $10,416,587 - $10,000,000 $7,174,214 $8,000,000 $6,000,000 $4,000,000 $2,179,098 $2,000,000 FY19 FY20 FY21 FY22 FY23 Base Increase Pass Through -TOTAL 21 Fieldman I Rolapp & Associates June 211 2018 • The downward trend is not conducive to maintaining the strong credit ratings of the District. • Projected debt service coverage ratios are significantly lower than previously projected. • District will be in default of rate covenant ( 1.25x) FY22 without rate adjustments. • Without rate adjustments or pass through increases, the future does not look robust for the District. Absent a concrete plan in place to reverse the projected coverage ratio trend, the District could be subject to a potential downgrade of the current ratings and incur significantly higher interest expense for its next bond issue. 22 Operations /Engineering: Minimal CIP • OPEB/PERS Liability Pay Down [5 & 10 years] • Deferred Projects (Year 6 and 11, additional funding available) • Balanced cash-flow • FY19-23: $19,848,440 t s:.......... ................... ....... .......... 23 Draft Five-Year CIP Budget (WATER) FY19 FY20 FY21 FY22 FY23 FY19-FY23 Deferred CIP Scenario CIP Budget CIP Budget CIP Budget CIP Budget CIP Budget CIP Budget Capital and Rehabilitation and Replacement IR&RI Proiects_ Fairmont Booster Pump Station Upgrade $ 400,000 $ - $ - $ - $ - $ 400,000 Well 22 $ 300,000 $ 1,100,000 $ - $ - $ - $ 1,400,000 PRS Rehabilitation Phase 2 $ 500,000 $ - $ - $ - $ - $ 500,000 Tract 15199 Waterline Replacement $ 750,000 $ - $ - $ - $ - $ 750,000 Fairmont Reservoir Rehabilitation Deferred Field Headquarters Rehabilitation and ADA Upgrades $ - $ 500,000 $ - $ - $ - $ 500,000 Mickel and Camino Verde Waterline Replacement $ 500,000 $ - $ - $ - $ - $ 500,000 Grandview and Short Waterli ne Replacement $ - $ 500,000 $ - $ - $ - $ 500,000 Meter Conversion Project(AMI) Deferred Wel l Equi pment Rehabilitation $ 150,000 $ 150,000 $ 150,000 $ - $ - $ 450,000 Well 23 Deferred Ductile Iron Pipe(DIP)Replacement Deferred Water Supply Redundancy and Fire Flow Reliability(5 locations) Deferred Box Canyon Pump 2 Replacement $ - $ - $ 63,000 $ - $ - $ 63,000 Lakeview Booster Piping $ - $ - $ 154,000 $ - $ - $ 154,000 Apple Creek and Del Rey PRS Rehabilitation $ - $ - $ - $ 450,000 $ - $ 450,000 Bryant Ranch Reservoir Erosion Control and Fencing $ - $ 90,000 $ - $ - $ - $ 90,000 Imperial Hwy Waterline Replacement Deferred Ti mber Ridge BPS Rehabilitation $ - $ - $ 900,000 $ 602,000 $ - $ 1,502,000 Eisenhower Waterline Replacement $ - $ - $ - $ - $ 1,125,000 $ 1,125,000 Well 20 Chemical System Replacement Deferred New River Waterline Replacement Deferred Hidden Hills BPS Rehabilitation $ - $ - $ - $ 500,000 $ - $ 500,000 Reservoir Rehabilitation $ - $ - $ - $ - $ 200,000 $ 200,000 Well 15 Chemical System Replacement Deferred Dominguez Hills and Paseo Del Prado PRS Rehabilitation $ - $ - $ - $ 553,000 $ - $ 553,000 Future Waterline Replacement $ - $ - $ 2,000,000 $ 1,000,000 $ 2,000,000 $ 5,000,000 Rose Drive Waterline Replacement Deferred Santiago BPS Rehabilitation Deferred Spri ngvi ew BPS Rehabilitation Deferred Engineering Support and Project Management Services $ - $ - $ 300,000 $ 600,000 $ 600,000 $ 1,500,000 Capital and R&R Projects Subtotal= $ 2,600,000 $ 2,340,000 $ 3,567,000 $ 3,705,000 $ 3,925,000 $ 16,137,000 $39,812,440 Vehicle and Caoltal Enuioment Replacement $19,848,440 SCADA Radio Communicate ons System Enha ncement $ 125,000 $ 125,000 $ - $ - $ - $ 250,000 Emergency Vehicle Radio Communicate ons System $ - $ - $ - $ 200,000 $ 225,000 $ 425,000 _______ Capital Equipment Replacement $ 547,500 $ 282,235 $ 287,235 $ 262,235 $ 272,235 $ 1,651,440 Vehicl a Repl acement-Water $ 212,000 $ 339,000 $ 327,000 $ 222,000 $ 285,000 $ 1,385,000 $19,964,000 Vehicle&Capital Equipment Subtotal= $ 884,500 $ 746,235 $ 614,235 $ 684,235 $ 782,235 $ 3,711,440 I0 -* TOTAL= 3,484,500 $ 3,086,235 $ 4,181,235 $ 4,389,235 $ 4,707,23-411.$19,848,440,.* Capital Improvements Minimal Plan 1�ater CIP and Funding Sources 25 � $6 $4.�0 $5.3❑ $4 - $3.48 $3.15 $1 - $Q FY 2Q18 FV X419 FY ��2D F1f 223 ■ Debt Funded ■ PAYG� j Tatal CIP Water Revenue Adjustments&Coverage Chart Millions Total (Nater Reserve Ending Balances 100 0 — ........ ........ 500 0 w ........ ........ 809000 196% 3009VO0 ... 142X.........10014.. .... $30 459c ■ 6 .... 09000 100% $20 . .......� ...� :516. .:... 4F,o -100900o ... $8 20% -3009000 $10 on o.'S 0.0% D.0% 0.0% 0.0% 0% -5CO% $0 Rev Adj FY 2018 FY 2019 FY 2020 FY 2021 FY 2022 FY 2023 Coverage 11 2018 FY 2019 FY 2120 FY 2021 FY 2022 FY 2023 ...Lu.... 111611.1611.W- Rev Adjustment Coverage Ratio right axis Ending Balances Proposed Min Balances Proposed Target Balances Required Coverage-125% ■ Alert Coverage ......••• Target Debt Coverage-225% ■ Alert Balances ......Existing Min Balances 5 Water Revenue Adjustments&Coverage Chart Millions Total (Nater Reserve Ending Balances 100 0 – ............. 500 0 w ........ ........ 14 809000 221% 207% 180% 300% , ......... W. .................. $30 609000 1009000 . $20 – ...,... ...�....� $19 4007o -100900o 20% — -300% $10 a.a 0.'% D.D% D.0% 0.0% 0.0% 0% -500% $0 Rev Adj FY 2018 FY 2019 FY 2020 FY 2021 FY 2022 FY 2023 Coverage FY 2018 FY 2019 FY 2D20 FY 2021 FY 2022 FY 2023 Rev Adjustment Coverage Ratio right axis Ending Balances Proposed Min Balances Proposed Target Balances Required Coverage-125% ■ Alert Coverage ......••• Target Debt Coverage-225% ■ Alert Balances ......Existing Min Balances 7 Water Revenue Adjustments&Coverage Chart Millions Total (Nater Reserve Ending Balances 3096 500% $40 300% 20% ....................�..................�.......................................... $30 100% � � �..... $20 �...... ....... ..... 1095 3.0% 3.0% 3.0% 3.09'o 3.0% 1 -30001/0 $10 0% -5001% $0 Rev Adj FY 2018 FY 2019 FY 2020 FY 2021 FY 2022 FY 2023 Coverage FY 2018 FY 2019 FY 2D20 FY 2021 FY 2022 FY 2023 Rev Adjustment —Coverage Ratio right axis Ending Balances Proposed Min Balances Proposed Target Balances Required Coverage-125°Vo a Alert Coverage ......••• Target Debt Coverage-225% 0 Alert Balances ......Existing Min Balances Revenue Needed MINIMAL CIP; YEARLY REVENUE NEEDED $9,000,000 $8,278,460 $8,000,000 - $7,000,000 $6,440,998 _ $6,000,000 _ $5,000,000 $4,626,781 $4,000,000 $3,000,000 $2,687,323 _ $2,000,000 $811,2145 $1,000,000 FY19 FY20 FY21 FY22 FY23 Base Increase Pass Through -TOTAL 29 11 years from now... better off due to early payments of pension liabilities I 30 dL R S S � 1. Formula for Rate Increase Policy • Basic Service Charges • Commodity Charges • Energy Charges (requires new Prop. 218 process) 2. Pay-Go versus Debt-Funding Policy • Ratio or Type of Project 3. Implementation of 2-Year Budget cycles GFOA: 5 -Year Forecast Presentation • 10G pass through to Commodity Charge for FY19 • 5-Year CIP total : $ 19,848,440 • Minimum, 3% increase of Service ( Base) Charge each year 3 % Base Charge Changes Base Base IF Not-to- Fiscal Year Charge Dollar Charge Dollar in Effect effective Difference effective Difference Prop. 218 January Ist January Ist Rate(I") W and /„ VI $ 51.76 FY19 $ 20.03 $ 0.58 $ 33.47 $ 0.98 $ 57.54 FY20 $ 20.63 $ 0.60 $ 34.48 $ 1.01 $ 63.81 FY21 $ 21.25 $ 0.62 $ 35.52 $ 1.04 FY22 $ 21.89 $ 0.64 $ 36.59 $ 1.07 FY23 $ 22.55 $ 0.66 $ 37.69 $ 1.10 33 3 - 6% Base Charge Changes Base Base Base '--w Base Not-to- Fiscal Year Charge Dollar Charge Dollar Charge Dollar Charge Dollar in Effect effective Difference effective Difference effective Difference effective Difference Prop. 218 January Ist January Ist January Ist January Ist Rate 3% 4% 5% 6% $ 51.76 FY19 $ 33.47 $ 0.98 $ 33.79 $ 1.30 $ 34.12 $ 1.63 $ 34.44 $ 1.95 $ 57.54 FY20 $ 34.48 $ 1.01 $ 35.15 $ 1.36 $ 35.83 $ 1.71 $ 36.51 $ 2.07 $ 63.81 FY21 $ 35.52 $ 1.04 $ 36.56 $ 1.41 $ 37.63 $ 1.80 $ 38.71 $ 2.20 FY22 $ 36.59 $ 1.07 $ 38.03 $ 1.47 $ 39.52 $ 1.89 $ 41.04 $ 2.33 FY23 $ 37.69 $ 1.10 $ 39.56 $ 1.53 $ 41.50 $ 1.98 $ 43.51 $ 2.47 Charges are based on a 1" meter. 34 g Changes to "Average " Customers FISCALYEAR Average MONTHLY Bill Monthly Monthly IN EFFECT (18 units of water) Dollar Difference Percent Change Current $81.09 -- -- FY19 $83.87 $2.78 3.43% FY20 $87.04 $3.17 3.78 FY21 $89.52 $2.48 2.85% FY22 $92.39 $2.87 3.21% FY23 $95.11 $2.72 2.94% Average customer is defined as using 18 units of water per month with a 1" meter. 35 g Changes to " High " Customers FISCALYEAR Average MONTHLY Bill Monthly Monthly IN EFFECT (SO units of water) Dollar Difference Percent Change Current $167.49 -- -- FY19 $173.47 $5.98 3.57% FY20 $180.48 $7.01 4.04% FY21 $185.52 $5.04 2.79% FY22 $191.59 $6.07 3.27% FY23 $197.19 $5.60 2.92% High customer is defined as using 50 units of water per month with a 1" meter. 36 Future • Rolling 5-Year CIP projections • Water Quality Regulatory • Revised annually Requirements • Imperial Highway vs Bixby Area • PFAS • Sacramento • Water & Sewer Rate Study • SB606 & AB1668 Required in FY20 An overview of recent(2012-2018)California legislation related to water affordability. Budget Trailer Bill •Requires the •Declares the State Water •Implements a •Similiar to SB •Requires water human right to Board to state drinking 623,but utilities to have water in propose a plan water tax integrated in the a written policy California for a statewide 2018-19 on water Low-Income Governor's shutoffs for Rate Assistance Budget deliniquent program for customers drinking water r � r r t Known Unknowns 1. MIL L4Weather ` .7•y j • Drought, k-_ Wateravailable r • Wildfires, ;; ib precipitation (cm) • Atmospheric Rivers CALIFORNIA'S DROUGHT WEAKENS Because of this winter's intense storms.42 percent of California is no longer in drought, up from just 3 percent a year ago. f 2035 2037 2037 Drought Dec.29 Jan.3 Jan.10 severity ❑No drought ❑Abnormally 1 dry �r ❑Moderate drought y,� - Severe drought Extreme drought , --- WL — Exceptional drought -.�• -.• -.• � �� i t t }, i w. Source-U-S.Drought Monitor --- - BAYARFANEWSGROUP - :rd Unknown Unknown s ? Questions ? Norb Linda Water District Retail Consumption ; FY17 - FY19 1 StQuarter , Retail Consumption 1,200,000 1,000,000 800,000 �. 600,000 u u 400,000 200,000 0 715,633 695,308 774,260 764,756 1,019,6 1,023,369 847,483 8,682 794,252 July August September 0 FY17 0 FY18 0 FY19 System Demand FY17 - FY19 1StQuarter , System Demand 2,500 2,000 1,500 v v v `u m 1,000 500 2,011 2,130 2,277 2,0 2 L ,284 1,853 2,010 0 July August September 0 FY17 FY18 0 FY19