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HomeMy WebLinkAboutAttachment 1 - Title 3.01 Code Revision Title 3 Page 1 TITLE 3 FINANCE AND ACCOUNTING CHAPTERS 3.01 Financial Goals 3.02 Budget Control 3.04 Auditing 3.05 Governmental Accounting Standards Board (GASB) 3.06 Electric Supply Procurement 3.07 Debt Issuance and Management Policy 3.08 Purchasing 3.10 Capitalization Policy 3.12 Accounts Receivable 3.16 Accounts Payable 3.20 Investments 3.24 Restricted Funds 3.32 Standby Charges and Assessment Districts CHAPTER 3.01 FINANCIAL GOALS Section: 3.01.01 Financial Goals 3.01.01.1 The following goals are established to promote and maintain the financial strength of the District: 3.01.01.01 Planning Goals  Review Water and Electric Master Plans at least every five years  Review ten-year Finance Master Plan each year  Prepare two-year operating budget with semi-annual reviews  Prepare ten-year Capital Improvement Plan; update annually  Review rate structure and levels every two years  Review Financial Goals every year 3.01.01.02 Revenue Goals  Set operating revenues to capture entire cost to provide service plus build and maintain reserves and satisfy debt coverage ratios Title 3 Page 2  Review connection charges every two years and set them to recover all costs  Review facilities fees every budget cycle and after the completion of a master plan 3.01.01.03 Debt Goals  Separate debt that is serving development (facilities fees), debt serving current customers (rates), debt serving a special assessment district (assessments) and debt financed by billing surcharges. These categories of debt should be separately identified in the budget  One-half the debt service for all long-term debt in the aggregate is due in the first ten years  No more than one half the projected annual facilities fee revenue committed to debt service  No more than twenty-five percent of general fund revenues committed to debt service  No debt more than 30 year maturity  No debt longer than useful life of the project  Debt issued by the District, either directly or indirectly, shall be subject to these provisions and section 3.07, Debt Issuance and Management Policy: 3.01.01.04 Cash Reserve Goals - Operations  Water general fund should have a cash reserve equal to one half of the annual budgeted operating expenses, excluding depreciation.  twice the highest month budgeted expenditure (this will probably be the month in which principal and interest on debt is due)  Electric general fund should have a cash reserve equal to one half of the annual budgeted operating expenses, excluding depreciation .  Electric rate stabilization fund (aka Electric Rate Reserve) should maintain a balance of $3,000,000minimum cash reserve equal to six months of the budgeted cost of purchased power.  Both the Electric and Water Utilities shall maintain a Board restricted operating reserve fund titled Deferred Liability. The intent of the fund is to provide reserves for unfunded liabilities such as pension costs and the reserve goal shall be determined by the Board on an annual basis. 3.01.01.05 Capital Reserve Goals  There should be a revolving water capital reserve fund equal to the average annual budget for capital replacement in the amount of $4,000,000 to permit projects to be initiated and funded prior to arrangement of long-term debt or other financing.  There should be a revolving electric capital reserve fund n electric capital reserve fund in the amount of $1,000,000 minimum.equal to the average annual budget for capital replacement. 3.01.01.06 Debt Reserve Goals  There should be a reserve fund for each debt instrument in an amount required by each lender.