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Home My WebLink About8 2008 electric rates Agenda Item # 81 9 &10 iUCKEE • Memorandum To: Board of Directors From: John Ulrich Date: November 15, 2007 Subject: Adoption of the budget for 2008, the overhead rates and electric ordinance Why this matter is before the Board: This matter involves three separate agenda items that are related to one another. It involves adoption of a budget for 2008, adoption of the overhead rates and adoption an electric rate ordinance. These are all matters that only the Board can determine. History: A draft budget has been presented to the Board of Directions through a series of budget workshops. Overhead rates for 2008 allocate indirect costs to associated projects and are located in the appendices in the back of the draft budget for 2008. The draft budget recommended an electric rate increase of 9.94%. At the last budget workshop, various electric rate scenarios and impacts were presented. A public hearing was held at the last Board meeting on November 7 and again tonight. New information: Since three agenda items all relate to the budget for 2008, they can be considered a package that can be dealt with together, although they appear as separate agenda items. The resolution adopts the 2008 budget. One resolution adopts the overhead rates. An ordinance adopts the electric rate increase, which includes the California Solar Initiative customer charge. The draft ordinance and resolutions are attached. Recommendation: I recommend that: the Board adopt: Agenda Item 8 — Resolution for the 2008 Budget Agenda Item 9 — Resolution for the 2008 overhead rates Agenda Item 10 — rdinance for an electric rate and the California Solar Initiative customer charge 7 Ulrich, Interim GM Public Utility District Resolution No. 2008 - XX ADOPTING THE BUDGET FOR 2008 WHEREAS The Board of Directors adopted a Mission Statement and statement of goals and objectives for the District; and WHEREAS District staff used that Mission Statement and statement of goals and objectives to prepare a draft budget for 2008; and WHEREAS the Board of Directors and staff of the District participated in departmental workshops in the months of September and October of 2007 to review the draft Budget; NOW THEREFORE BE IT RESOLVED by the Board of Directors of Truckee Donner Public Utility District to adopt the draft budget for 2008. BE IT FURTHER RESOLVED by the Board of Directors authorizes the General Manager and staff the authority to implement the annual 2008 budget. PASSED AND ADOPTED by the Board of Directors at a meeting duly called and held within the District on the 19th of November 2007 by the following roll call vote: AYES: ABSTAIN: NOES: ABSENT: TRUCKEE DONNER PUBLIC UTILITY DISTRICT By Tim F. Taylor, President ATTEST: John L. Ulrich, Clerk of the Board Public Utility Distr'�ct OP I T r4' - ____j Resolution No. 2008 - XX ADOPTING THE OVERHEAD RATES FOR THE 2008 BUDGET WHEREAS the Board of Directors and staff of the District participated in departmental workshops in the months of September and October of 2007 to review the draft Budget for 2008; and WHEREAS the draft budget for District operations and capital spending for the year 2008 recommends certain accounting overhead rates; and NOW THEREFORE BE IT RESOLVED by the Board of Directors of Truckee Donner Public Utility District adopts the following budget overhead rates: Overhead Item Overhead Rate Labor Overhead 46.00% Transportation Overhead $10.05 Inventory Overhead 16.59% Administrative Overhead 1.16% Construction Overhead 29.07% Non-inventory Material Overhead 25.00% PASSED AND ADOPTED by the Board of Directors at a meeting duly called and held within the District on the 19th of November 2007 by the following roll call vote: AYES: ABSTAIN: NOES: ABSENT: TRUCKEE DONNER PUBLIC UTILITY DISTRICT By Tim F. Taylor, President ATTEST: John L. Ulrich, Clerk of the Board s C ■ : DO . R Public Utility D istrict Ordi ance No. 2007 - XX AMENDING THE ELECTRIC RETAIL RATES AND ESTABLISHING THE CALIFORNIA SOLAR INITIATIVE CUSTOMER CHARGE WHEREAS District staff has prepared a budget for District operation for 2008; and WHEREAS, on November 7 and 19, 2007 a public hearing was held to receive comments from the public concerning the 2008 budget; and WHEREAS, the budget for 2008 recommends that electric retail rates be increased by 9.94% to cover increases in the costs of providing District services; and WHEREAS, on November 7 and 19, 2007 a public hearing was held to receive public comments on proposed electric rate increase; WHEREAS, the state of California has enacted The California Solar Initiative, through the signing of SB-1; and WHEREAS, the California Solar Initiative requires that electric utility companies must raise, through customer charges, a specified amount of money to fund the required solar rebate program; and WHEREAS, the Truckee Donner Public Utility District must raise $177,400 annually for the solar rebate program. NOW, THEREFORE, BE IT ENACTED by the Board of Directors of the Truckee Donner Public Utility District as follows: Section 1. Effective January 1, 2008, the following monthly electric rates shall be effective. Domestic Electric Rates: Permanent Residents Rate P10 Customer Charge: per month $6.74 Energy Charge per kilowatt-hour $0.132 Domestic Electric Rates: Non-Permanent Residents Rate S 10 Customer Charge: per month $6.74 Energy Charge per kilowatt-hour $0.151 Small Commercial Rates Rate 15 Customer Charge: per month $13.07 Energy Charge per kilowatt-hour $0.158 Ordinance 2007-XX 1 Medium Commercial Rates Rate 20 Customer Charge: per month $130.49 Energy Charge per kilowatt-hour $0.093 Demand Charge per kilowatt of demand $12.83 Large Commercial Rates Rate 25 Customer Charge: per month $572.37 Energy Charge per kilowatt-hour $0.096 Demand Charge per kilowatt of demand $12.26 Section 2: Effective January 1, 2008, the following monthly solar initiative customer charge shall be effective. Domestic (both permanent and non- permanent) Small Commercial Medium Commercial Large Commercial Section 3. If no protest is made pursuant to Public Utilities Code Section 16078, then this ordinance shall be effective January 1, 2008. Section 4. The Clerk of the District shall immediately cause a copy of this ordinance to be published in a newspaper of general circulation and posted in three places within the District. Section 5. The provisions of other Ordinances shall remain if effect to the extent that they do not conflict with this ordinance. PASSED AND ADOPTED by the Board of Directors of the Truckee Donner Public Utility District at a meeting duly called and held within the District on the nineteenth day of November 2007 by the following roll call vote: AYES: NOES: ABSTAIN: ABSENT: TRUCKEE DONNER PUBLIC UTILITY DISTRICT By Tim F. Taylor, President of the Board ATTEST: John L. Ulrich, Clerk of the Board Ordinance 2007-XX 2 2007 Member Average Rates = under PG&E = w/i 1 cent > PG&E = Over 1 cent > PG&E Expected 2007 Class Average Rates -- cents / kWh Utility Residential Commercial Industrial System Alameda 12.25 12.71 11.61 12.44 Biggs 13.15 13.84 9.28 9.97 Gridley 12.45 12.20 12.30 Healdsburg 13.18 11.71 964 1229 Lodi 15.76 13.58 8.55 13.35 Lompoc 9.75 11.42 9.35 10.16 Palo Alto 9.37 9.40 8.50 8.74 Plumas-Sierra 9.45 10.42 6.99 8.37 Roseville 10.10 9.20 7.00 8.90 Ukiah 13.80 15.32 10.51 1331 Lassen 12.32 12.98 12.51 Redding 8.82 9.36 909 Santa Clara 10.80 8.70 8.36 Truckee Donner 23.2% Less 12.64 13.21 13.35 Turlock 11.85 10.48 7.77 9.74 Simple Average Rate 11.56 11.77 8.90 10.86 Percent PG&E Rate 70.3% 75.2% 68.8% 73.0% Pacific Gas & Electric (1/1/07) 16.44 15.661 12.93 14.87 Sacramento Municipal Util Dist 77 9.491 8.71 10.10 Note: Based on PG&E rates effective1/1/07, PG&E commercial based on average of A-1 and A-10 rate class. Rate Increase Options Average kWh Use/month 761 KWh 2007 Zone 1 2008 Zone 1 Residential Residential 2007 21)13 ° 2 PWater Water Total9 0 : Q CCU 9.94%in 2008 0.00%in 2009 2007 „ 2008�; 2009 Primary Residential Electricity$ $97.45 $107.14 $107.14 $52.13 $55.26 $149.58 ON, $Monthly Increase $9.69 $0.00 $3.13 600%in 2008 4.00%in 2009 2007 2002009 Primary Residential Electricity$ $97.45 $103.30 $107.43 $52.13 $55.26 $149.58 _ $�'S$$ Q � , $Monthly Increase $5.85 $4.13 $3.13 5.00%in 2008 5.00%in 2009 2007 2fl082009K Primary Residential Electricity$ $97.46 $102.32 $107.44 $52.13 $55.261 $149.58 w r.5 3 1,62. 3.259$ $Monthly Increase $4.87 $5.12 $3.13 7.00%in 2008 3.00%in 2009 2007 2�0082� 2009. Primary Residential Electricity$ $97.45 $104.27 $107.40 $52.13 $55.26 $149.58 51$9.5 .65r $Monthly Increase $6.82 $3.13 $3.13 November 7,2007 rIIIII.UCKEE Ali IIII DONNER III Memorandum To: Board of Directors From: Barbara Cahill Subject: Overhead rate resolution Date: November 19, 2007 1 inadvertently picked up the incorrect figure on Appendix III, Labor Overhead, for the 2008 budget. Please find attached a revised resolution and the page from budget book. Thank-you TRUCKEE DONNER f L�t) Resolution No. 2008 - XX ADOPTING THE OVERHEAD RATES FOR THE 2008 BUDGET WHEREAS the Board of Directors and staff of the District participated in departmental workshops in the months of September and October of 2007 to review the draft Budget for 2008; and WHEREAS the draft budget for District operations and capital spending for the year 2008 recommends certain accounting overhead rates; and NOW THEREFORE BE IT RESOLVED by the Board of Directors of Truckee Donner Public Utility District adopts the following budget overhead rates: Overhead Item Overhead Rate Labor Overhead A3.650/6 odacea:as.00 Transportation Overhead $10.05 Inventory Overhead 16.59% Administrative Overhead 1.16% Construction Overhead 29.07% Non-inventory Material Overhead 25.00% PASSED AND ADOPTED by the Board of Directors at a meeting duly called and held within the District on the 19"'of November 2007 by the following roll call vote: AYES: ABSTAIN: NOES: ABSENT: TRUCKEE DONNER PUBLIC UTILITY DISTRICT By Tim F.Taylor, President ATTEST: John L. Ulrich, Clerk of the Board APPENDIX III LABOR OVERHEAD VALUE OF BENEFITS Medical/Dental insurance $1,273,862 Vision insurance 25,000 Long term disability 44,687 Life insurance 59,853 Longevity 17,144 FICA 351,084 Fed Med 87,234 Worker's compensation insurance 297,638 Pension 1,161,582 GASB 45 OPEB cost 198,800 Value of non productive labor 829,094 (vacation, sick leave, holiday) TOTAL VALUE OF BENEFITS $4,345,978 PRODUCTIVE LABOR Recommended labor(Appendix li) $6,024,487 Less value of non productive labor (829,094) TOTAL PRODUCTIVE LABOR $5,195,393 PAYROLL OVERHEAD 83.65% (Value of benefits/productive labor) BENEFITS AS A PERCENT OF TOTAL LABOR AND BENEFITS 46% 55