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Home My WebLink About13 Mid Cycle and End of Year Financial REsultsiendaItem#13TRUCKEEDONNERPublicUtilityDistrictACTIONTo:BoardofDirectorsFrom:ReginaWiseDate:March06,2019Subject:Mid-CycleBudgetReviewa)FY18End-of-YearFinancialResultsb)ConsiderationofEnd-of-YearTransfers1.WHYTHISMATTERISBEFORETHEBOARDThisisayear-endreviewwiththeBoardofthefinancialresultsasofDecember31,2018.2.HISTORYTheBoardapprovedtheFY18BudgetonNovember14,2017.Districtcoderequiresasemiannualreviewsofthebudgetedrevenuesandexpenditurescomparedtotheactualrevenuesandexpenditures.Staffreviewedthemid-yearFY18budgettoactualfinancialperformanceinaworkshopwiththeBoardonAugust1,2018.TheBudgettoactualreportisaconsolidatedreportofactualactivityforrevenues,operationalexpenses,andcapitalimprovementprojectsfundedbyratesandreserves.Thecurrentreportingexcludesaccrualentriesinrevenues,depreciation,amortization,andrevenueandexpensesassociatedwithcontributedcapitalprojects.3.NEWINFORMATIONDistrictcustomergrowthisakeybudgetassumptionintheFY18andFY19approvedbudget.TheDistrict’sgrowthmettheFY18budgetassumptionof1%.Additionally,theDistrict’semployeecountdecreasedbyonefulltimeequivalent(FTE)duetoattritioninplannedretirements.CustomercountsandemployeeFTE’sasofDecember31,2018andDecember31,2017areasfollows:UtilityFY18FY17GrowthElectric13,88713,7681%Water13,08512,9721%FTE’s7071-1%PreliminaryFY18year-endfinancialsummaryresultsareincludedinAttachment1andAttachment2.BoththeElectricandWaterutilitiesreportedpositivenetoperatinginflows.TheElectricUtilityhadnetoperatinginflowof$6.OM.TheWaterUtilityhadnetoperatinginflowof$222K. ElectricUtilityAttachment1isthepreliminaryBudgetvs.ActualRevenue&ExpendituressummaryreportfortheElectricUtilityforFY18.RevenuesexceededbudgetexpectationsinFY18by3%.Aplannedrateincreaseof3%wasimplementedinFY18.ExpensesfortheElectricUtilitywerebelowbudgetexpectations;theprimarydriverbeingefficientoperationsandthecostofpowerwhichwasdownjustunder$1.ZM.CapitalexpendituresfortheElectricUtilitywereunderbudgetby3%inFY18.TotalbudgetedcapitalexpendituresinFY18wasjustunder$6.1Mwithfundingfrombothoperationsandthecapitalreserve.ActualcapitalspendinginFY18wasjustunder$5.9M.TheElectricUtilitycapitalinvestmentratio,whichlooksattotalcapitaloutlaycomparedtorevenuesfortheperiodasanevaluationtooloftheDistrict’sinvestmentinreplacingcapitalassetshasmorethandoubledat0.23forFY18comparedto0.10atFY17respecfully.ThisinlargepartisduetothemeterreplacementprojecttheDistrictconductedinFY18.Morethan6,000metershavebeenreplacedDistrictwideinFY18.ThenetchangeincashfortheElectricUtilityisanincreaseof$3.1M.Staffisrecommendingtransferring$2MoftheexcesstotheCapitalReserveFundforfutureprojects,and$1MtotheDeferredLiabilitiesReserve.ThenetchangeincashimprovedtheElectricUtility’scurrentratiowhichevaluatescurrentassetstocurrentliabilities,andwhichindicatestheabilitytopayit’sbills.WiththesetransferstheElectricUtilitymaintainsahealthycurrentratioof5.31atFYi8comparedto5.78atFY17yearend(aratiooflessthan1.5wouldbeofconcern).WaterUtilityAttachment2isthepreliminaryBudgetvs.ActualRevenue&ExpendituressummaryreportfortheWaterUtilityforFYi8.Revenuesexceededbudgetexpectationsby2%totalinFY18.Revenuesincludeda3%plannedrateincrease.Expensesforthewaterutilitywereinexcessofbudget3%total,theprimarydriverwaswateroperationsexpensesexceedingbudget7%fromvariousincreasedoperatingcostsincludinginsurance,thecostofpumpingwater,maintenancematerialcosts,andregulatorycostsandfees.CapitalexpendituresfortheWaterUtilitywereinexcessofbudgetby17%inFY18duetotheaccelerationofthemeterreplacementprojectwhichisnowcomplete.Thisprojectwasprimarilyfundedbytheremainingmeterreservefundwhichhasbeenexhausted.TotalbudgetedcapitalexpendituresinFYi8werejustunder$2.7Mwithfundingfrombothoperationsandthemeterreservefund.ActualcapitalspendinginFY18wasjustover$2.8Mutilizingallthefundsinthemeterreserveanddrawinganadditional$135Kfromtheoperatingreserve.StaffisnotrecommendinganytransfersatFYi8yearendfortheWaterUtility.Netchangeincashwasreducedbyjustover$477Ktotal.However,thecurrentratioatyearendisstillhealthyat6.83.ThecapitalinvestmentratioforthewaterutilityincreasedinFY18to0.27from0.17inFY17duetoalargerpipelineprojectandemphasistocompletethemeterreplacementprogram. FacilitiesTheDistrictestablishesandcollectsfacilitiesfeesonnewdevelopmentforelectricandwatersystemimprovementsattributabletonewdevelopmentsinaccordancewiththeElectricandWaterMasterPlans.Attachment3reportsthestatusoftherestrictedFacilitiesFeesFundforeachUtilityrespectivelyasoftheendofFYi8.TheElectricUtilityfacilitiesfeecollectionsremainedstronginFYi8withreceiptsof$271KinFYi8comparedto$145KinFY18.TheElectricUtilitydidnothaveanybudgetedexpendituresforfacilitiesfeesforFYi8.TheWaterUtilityfacilityfeecollectioninFY18remainedverystrongwithreceiptsof$806KinFY18comparedto$416KinFY17duetothecontinueddevelopmentandnewconstructionwithintheDistrict.TheDistricthasbeenabletoutilizefacilitiesfeesforqualifyingdebtservicefortheWaterUtilityonanannualbasis;inFY18facilitiesfeeswereutilizedforthePipelineCOPdebtpayment.TheDistrictisobligatedtoutilizefacilitiesfeescollectedwithina5yearperiod,furthermore,meetingthisrequirement.4.FISCALIMPACTAttachment4showsthebeginningbalancesofthevariousreservefundsandtheendingbalancesaftertheproposedtransfers.AlsoincludedareproposedreservegoalswhichareunderreviewbytheBoardinaseperateitemduringthismeeting.OverallfiscalimpactisinalignmentwiththeBoardapprovedFYi8&FYi9Budget.5.RECOMMENDATION1.Acceptthisreport.2.AuthorizethefollowingTransfers:a.Transfer$2,000,000fromtheElectricGeneralFundtotheElectricCapitalReplacementReserve.b.Transfer$1,000,000fromtheElectricGeneralFundtotheElectricDeferredLiabilitiesReserve.q/‘oLisaHallMichaelD.HolleyAdministrativeServicesDirectorGeneralManager TruckeeDonnerPublicUtilityDistrictBudgetvs.ActualRevenue&ExpendituresFiscalYearEndingDecember31,2018ELECTRICDEPARTMENTATTACHMENT1PRELIMINARYFYi8BudgetVarianceFY18FavorableActual(Unfavorable)¾OPERATINGREVENUEResidentialCommercialInterdept.Sales&RentStandbyJointPoleOtherTotalOperatingRevenueOPERATINGEXPENSEBoardofDirectorsGeneralManagementAdministrativeSvcs.ConservationOperationslT/GlSBuildingMaintenancePurchasePowerTotalOperatingExpenseNETOPERATINGINCOMEOTHERINCOME(EXPENDITURE)InvestmentIncome(Loss)TransferfromCapitalReserveTransferstoVehicleReserveDebtPaymentTransfersfromCap&TradeAB32ReserveTotalOtherIncome(Expenditure)CAPITALEXPENDITURESFUNDEDBYOPERATIONS150,075111,39038,686763,970775,602(11,632)1,356,1741,374,794(18,620)899,255606,511292,7444,550,2464,918,381(368,135)661,181712,626(51,445)498,109412,11785,99212,692,52811,001,8581,690,67021,571,53819,913,2801,658,2583,120,4845,400,6752,280,191125,000297,418172,4182,065,2532,556,878491,625190,284113,660(76,624)(518,424)(518,424)-1,108,4081,140,37231,9642,970,5213,589,904619,3833,603,4062,980,402623,0042,487,5996,010,1773,522,578CAPITALEXPENDITURESFUNDEDBYRESERVESCapitalReplacement(AMI)VehicleReserveType$$12,981,6519,535,7331,725,54721,530262,000165,56124,692,022$13,360,5589,684,8791,683,54920,040306,198258,73125,313,955378,907149,146(41,998)(1,490)44,19893,170621,9323%2%-2%-7%17%56%3%26%-2%-1%33%-8%-8%17%13%8%138%24%-40%0%3%21%NETOPERATIONSFUNDEDCASHINFLOW(OUTFLOW)2,065,2532,556,878(491,625)422,346345,72276,6242,487,5992,902,600(415,001)NetBudgetActivity3,107,577 TruckeeDonnerPublicUtilityDistrictBudgetvs.ActualRevenue&ExpendituresFiscalYearEndingDecember37,2018WATERDEPARTMENTATTACHMENT2PRELIMINARYVarianceTypeOPERATINGREVENUEResidentialCommercialStandby&FireProtectionOtherTotalOperatingRevenueOPERATINGEXPENSEBoardofDirectorsGeneralManagementAdministrativeSvcs.ConservationOperationsIT/GISInterdepartmentalRentTotalOperatingExpenseNETOPERATINGINCOMEOTHERINCOME(EXPENDITURE)InvestmentIncome(Loss)TransferstoVehicleReserveTransfer(to)fromOperating&MeterReserveFacilityFundReimbursementforFacilityFeeDebtDebtServiceTotalOtherIncome(Expenditure)CAPITALEXPENDITURESFUNDEDBYOPERATIONSNETOPERATIONSFUNDEDCASHINFLOW(OUTFLOW)CAPITALEXPENDITURESFUNDEDBYRESERVESOperatingReserveVehicleReserveMeterReserveTotal28%0%-1%14%-7%-6%12%-3%38%0%128%0%0%FY18FY18FavorableBudgetActual(Unfavorable)¾$10,711,730S10,877,454$165,7242%1,576,7121,566,407(10,305)-1%133,440123,280(10,160)-8%246,291303,37457,08323%12,668,17312,870,515202,3422%150,075108,70041,375693,307692,7645431,299,6171,311,338(11,721)110,49295,15515,3374,871,3715,192,038(320,667)591,896624,689(32,793)524,567463,52761,0408,241,3258,488,211(246,886)4,426,8484,382,304(44,544)76,865106,20929,344(164,680)(164,680)0272,361620,499348,138356,284356,2840(2,272,371)(2,272,371)0(1,731,541)(1,354,058)377,4832,391,6262,806,006(414,380)-17%303,681222,239(81,442)135,159(135,159)303,681565,016(261,335)303,681700,175(396,494)NetBudgetActivity(477,936) FACILITIES FEES ANNUAL STATUS REPORT 12/31/18 ATTACHMENT 3 ATrACHMENT 3 ELECTRIC FACILITIES FEES:1.0.136.90 PROJECTEDAS OF 12.31.18 Beginning Balance Facilities fees collected during year Interest earnings during period Project expenditures during period Ending Balance WATER FACILITIES FEES:2.0.136.25 Beginning Balance Facilities fees collected during period Interest earnings during period Project expenditures during period Loan Payments: Debt Payments -facilities fees share Ending Balance 2014 2015 2016 2017 2018 $0.00 $205,185.65 $0.00 $153,619.20 $301,092.59 204,614.80 198,082.00 152,970.50 144,485.00 271,042.25 570.85 922.76 648.70 2,988.39 9,535.10 0.00 (404,190.41)0.00 0.00 0.00 $205,185.65 $0.00 $153,619.20 $301,092.59 $581,669.94 2014 2015 2016 2017 2018 ($0.00)$452,032.64 $514,264.20 $453,615.48 $370,773.27 451,695.96 567,524.95 440,684.46 415,593.10 806,030.72 336.68 3,739.61 5,418.82 7,792.69 14,289.97 0.00 0.00 0.00 0.00 0.00 0.00 (509,033.00)(506,752.00)(506,228.00)(356,284.00) $452,032.64 $514,264.20 $453,615.48 $370,773.27 $834,809.96 Ended 12/31/2018 $0.00 971,194.55 14,665.80 (404,190.41) $581 669.94 Total amount available-See NOTE 985,860.35 Less:Amount collected over last 5 years (404,190.41)Amount greater than 5 years old-NONE Summary 5 Years Ended 12/31/2018 $0.00 2,681 529.19 31,577.77 0.00 (1,878,297.00) $834,809.96 Total amount available-See NOTE 2,713,106.96 Less:Amount collected over last 5 years (1 878,297.00)Amount greater than 5 years old-NONE NOTE:If Total amount available is greater than Amount collected over the last 5 years,then the District has facilities fees on hand that are greater than 5 years old. If the amount of facilities fees on hand is greater than 5 years old,the District would have to either refund the money to customers or the Board would have to issue a finding that the money greater than 5 years old was being held to pay for a specific project.This report shows that the District does not have any electric or water facility fees on hand that are greater than 5 years old. ATTACHMENT 4 PRELIMINARY FY18 YEAR-END RESERVE BALANCES ELECTRIC UTILITY General Fund Rate Reserve Capital Reserve Deferred Liabilites Reserve Total Reserves Pr 1/1/2018 Balance $(3,OOO,OOO)$ 2,000,000 1,000,000 Adjusted Balance 7,912,000 5,585,000 4,084,000 2,011,000 $11,000,000 6,000,000 4,000,000 2,000,000 WATER UTILITY General Fund Operating Reserve Capital Reserve Deferred Liabilites Reserve Total Reserves Note: The Vehicle Reserve is consolidated into the Capital Reserve. FY18 1213112018 Proposed Activity Balance Transfers $6,348,000 $ 5,483,000 4,656,000 1,000,000 4,564,000 $ 102,000 (2,572,000) 11,000 Proposed Goal 10,912,000 5,585,000 2,084,000 1,011,000 Note: The Vehicle Reserve is consolidated into the Capital Reserve. The Facilities Fee Reserve and Cap and Trade reserve are excluded from this report. $17,487,000 $2,105,000 $19,592,000 $-$19,592,000 $23,000,000 $1,938,473 $(418,473)$1,520,000 -$1,520,000 $4,000,000 1,885,000 (70,000)1,815,000 -1,815,000 - 61,000 174,000 235,000 -235,000 4,000,000 100,000 .2,000 102,000 102,000 800,000 $3,984,473 $(312,473)U 3,672,000 $-$3,672,000 $8,800,000 The Meter Reserve was removed as it was exhausted in FYi 8.