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HomeMy WebLinkAbout12 FY 20 and FY21 Financial Plan Review WorkshopAqendaItem#r12TRUCKEEDONNERPublicUtilityDistrictWORKSHOPTo:BoardofDirectorsFrom:ReginaWiseDate:October02,2019Subject:FY20andFY21Budget;FinancialPlanReview,ProjectedRevenue,--- - -andProjectedReserveBalances1.WHYTHISMATTERISBEFORETHEBOARDThisitemcontinuestheprocessfortheFY20andFY21Budget.2.HISTORYTheFinancialMasterPlanisatooltohelptheBoardandstaffunderstandhowtheproposedbudgetimpactslong-termgoalsItincludesaprojectionoftherevenueandexpensesforFY20throughFY29usingtheactualrevenueandexpensesforthemostrecenttwelvemonths,theproposedFY20andFY21budget,andasetofassumptions.TheFinancialMasterPlanisreviewedduringthebudgetcycletoensurethattheproposedbudgetisconsistentwithlong-termgoals.3.NEWINFORMATIONThefollowingassumptionswereusedforprojectingtherevenueandexpensesforFY20throughFY29:.1%annualincreaseincustomergrowth;.3%annualinflation;.Nonewdebt;.InFY22,theratefundeddebtfortheWaterUtilitywillbecutinhalfbecausetherefundingportionofthe2006COPandtheProp55debtwillbepaidoff;.InFY22,thePensionSidefunddebtsharedbytheElectricandWaterUtilitywillalsobepaidoff;.Interestearnedisanaverageofjustunder2%;.StartinginFY21thecapandtraderevenuecoulddisappear;.CaIPERSchangesforthediscountrateforpensionhavebeenincludedintheFinancialMasterPlan;and.CashandReservegoalshavebeenupdatedtomatchthoseadoptedbytheBoardinFY19.Attachment1isasummaryoftheElectricUtility’sFinancialMasterPlan.ItincludesthescheduledelectricrateincreasesinFY20andFY21,andinflationaryincreasesintheoutyearstomaintainoperationsandcapitalimprovementswhilenotcompromisingreserves.TheElectricUtilitycurrentlyhasadebtservicecoveragerequirementof1.10andthecurrentprojectionsdonotraiseconcernwiththeDistrict meetingthatrequirementthroughtheremainingyearsoftheoutstandingdebt.Attachment2depictsthereservebalances.ThecashreservesareprojectedtoremainjustbelowtheDistrict’scurrentreservegoallevel.Attachment3isalistofproposedElectricUtilitycapitalprojectsthatwereincludedintheFinancialMaserPlanassumptions.Attachment4isasummaryoftheWaterUtility’sFinancialMaserPlan.Itincludesthemaximumrateincreaseof3%forFY20andinflationaryincreaseof3%inFY21and2%intheoutyearstomaintainoperationsandcapitalimprovementswhilealsobuildingreservestomeetDistrictgoals.ThedebtservicecoverageratiofortheWaterUtility’scurrentoutstandingdebtisaminimumof1.25until2036andthecurrentprojectionsarenotraisingconcernswithmeetingthatrequirementthroughtheremainingyearsoftheoutstandingdebt.Attachment5depictsthereservebalances.ThecashreservesfortheWaterUtilityareprojecttoincreaseasdebtobligationsarepaidoff.Attachment6isalistoftheproposedWaterUtilitycapitalprojectsthatwereincludedintheFinancialMaserPlanassumptions.Attheworkshop,staffwillpresentaspreadsheet-basedmodeltodemonstratethesensitivityofrevenueandcashasrateschange.4.FISCALIMPACTTheproposedFY20andFY21BudgetisconsistentwiththeDistrict’slong-termgoals;andstaffisproposingabalancedbudgetforFY20andFY21.5.RECOMMENDATIONReceivethisreportandprovidecommentstostaff.fr2ReginaWiseMichaelD.HolleyFinance&AccountingManagerGeneralManager Truckee Donner Public Utility District Financial Master Plan Summary FY20 through FY29 (in thousands) Attachment 1 ELECTRIC Debt service coverage (1.10 required until 2022) IProposed rate change 2.7%3.0%3.0%3.0%3.0%3.0%2.0%2.0%2.0%2M%I FY20 FY21 FY22 FY23 FY24 FY25 FY26 FY27 FY28 FY29 $26,912 $27,685 $28,785 $29,930 $31,121 $32,359 $33,331 $34,333 $35,365 $36,427 (23,928)(24,168)(24,893)(25,640)(26,409)(27,201)(28,017)(28,858)(29,723)(30,615) 347 369 182 186 196 212 242 272 310 350 Operating Cash Flow Operating revenue Operating expenses Other revenue/(expenses) Net Income Transfer from/(to)funds Debt principle payments Capital projects Change in Operating Cash Cash &Reserve Balances Operating Cash Balance Rate Reserve Balance Deferred Liability Facility Fee Reserve Balance Capital &Vehicle Reserve Balance Cash &Reserve Balances $3,331 $3,886 $4,074 $4,476 $4,908 $5,370 $5,556 $5,747 $5,952 $6,162 4,029 3,243 93 332 74 364 54 343 33 22 (587)(623)(323)------- (6,773)(6,506)(3,844)(4,31 1)(4,168)(4,279)(4,083)(4,191)(3,993)(6,098) $(0)$(1 )$(0)$498 $81 4 $1 ,455 $1 526 $1 ,900 $1 ,992 $86 $9,309 $9,309 $9,309 $9,807 $10,621 $12,076 $13,603 $15,502 $17,493 $17,579 5,982 6,102 6,224 6,349 6,476 6,605 6,737 6,872 7,009 7,149 2,090 2,132 2,175 2,218 2,263 2,308 2,354 2,401 2,449 2,498 139 251 386 274 409 253 401 259 419 590 3,452 1,771 1,628 1,488 1,352 1,220 1,093 971 855 743 $20,972 $19,565 $19,722 $20,136 $21,121 $22,462 $24,188 $26,005 $28,225 $28,559 3.07 3.45 7.37 no debt no debt no debt no debt no debt no debt no debt Attachment 2 Electric Projected Cash &Reserve Balance —Cash &Reserve Balances —Goal $34,000 ——— ________ $32,000 .-————... $30,000 $28,000 $26,000 $24,000 $22,000 $20,000 $18,000 — _______ ——-------————,____ ________ $16,000 -........... $14,000 .....•... FY20 FY21 FY22 FY23 FY24 FY25 FY26 FY27 FY28 FY29 Attachment 3 Operations Funded Line Extension &Upgrades Pole Replacements Various District Projects Electric Master Plan Projects Reclosers &Regs -Field Scada Distribution RepI &Improvement Meter Replacement District Administration Building Imp. Electric Operations Building SCADA Reliability Phase 5 &6 Electric SCADA Update IT Projects Truckee Donner Public Utility District Electric Capital Projects FY20 through FY29 Facility Fee Projects Truckee Substation Rebuild Vehicle Reserve Funded Vehicles 445,000 450,000 -300,000 400,000 400,000 400,000 400,000 400,000 400,000 400,000 400,000 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 482,651 500,583 315,600 325,068 334,820 344,865 355,211 365,867 376,843 388,149 554,254 574,324 591,554 609,300 627,579 646,407 665,799 685,773 706,346 727,536 266,798 275,011 283,261 291,759 300,512 309,527 318,813 328,377 338,229 348,376 705,212 1,370,095 756,198 894,534 921,370 649,011 668,481 388,536 400,192 412,198 188,402 195,014 200,864 206,890 213,097 219,490 226,075 232,857 239,842 247,038 450,506 466,110 480,094 494,497 509,331 524,611 540,350 556,560 573,257 590,455 -------2,000,000 1,000,000 550,000 250,000 255,000 260,100 265,302 270,608 276,020 281,541 287,171 121,526 1,222,658 -------- 875,153 103,232 87,036 79,388 626,479 646,143 566,755 583,757 601,270 619,308 637,887 657,024 676,735 697,037 5,358,01 5 5,982,558 3,444,325 3,660,806 3,768,080 3,578,521 3,683,224 3,491 01 4 3,592,985 5,697,959 970,273 72,428 -250,000 -300,000 Total Capital Projects 6,773,289 6,504,986 3,844,325 4,310,806 4,1 68,080 4,278,521 4,083,224 4,1 91 014 3,992,985 6,097,959 WATER Truckee Donner Public Utility District Financial Master Plan Summary FY20 through FY29 (in thousands) Attachment 4 Operating Cash Flow Operating revenue Operating expenses Other revenue and expenses Net income Transfers from/(to)funds Debt principle payments Capital projects Change in Operating Cash Cash &Reserve Balances Operating Cash Balance Operating Reserve Balance Vehicle Reserve Balance Meter Reserve Balance Facility Fee Balance Cash &Reserve Balances Debt service coverage (1 .25 required until 2036) $17,241 (12,445) $13,797 $ (9,505) (513) 14,206 (9,795) (439) FY20 FY21 FY22 FY23 FY24 FY25 FY26 FY27 FY28 FY29 $14,553 (10,077) (427) $14,909 $15,274 $15,649 $16,032 $16,425 $16,828 (10,393)(10,719)(11,056)(11,388)(11,730)(12,082) (363)(31 6)(272)(21 0)(1 71 )(1 31) ‘,‘,‘,‘,‘,‘,‘,‘,‘, (97) $3,779 $3,972 $4,049 $4,153 $4,239 $4,321 $4,434 $4,524 $4,615 $4,699 1,264 582 1,200 1,146 1,198 1,193 384 374 366 361 (2,630)(2,544)(1 ,571 )(1 ,398)(1 440)(1 488)(735)(765)(795)(820) (2,413)(2,009)(2,729)(3,696)(4,049)(3,518)(3,595)(3,673)(3,754)(3,837) $-$1 $949 $205 $(52)$508 $488 $460 $432 $403 $2,685 $2,685 $3,633 $3,839 $3,788 $4,296 $4,784 $5,245 $5,677 $6,081 1,540 2,586 2,638 2,691 2,744 2,799 2,855 2,912 2,971 3,030 15 25 25 76 77 82 92 109 132 163 107 109 111 114 116 118 121 123 126 128 1,416 1,553 1,557 1,559 1,561 1,578 1,615 1,669 1,742 1,830 $5,763 $6,958 $7,964 $8,279 $8,286 $8,873 $9,467 $10,058 $10,648 $11,232 2.48 2.76 4.84 4.90 4.95 4.99 5.08 5i6 5.23 531 IProposed rate change 3.0%3.0%2.0%2.0%2.0%2.0%2.0%2.0%2.0%2.0%J Attachment S $14,000 Water Projected Cash &Reserve Balance —Cash &Reserve Balances —GoaI $8,000 $6,000 $4,000 . .:.z :.::...z $2,000 FY20 FY21 FY24 FY25 FY26 FY27 FY28 FY29 $10,000 $12,000 FY22 FY23 Attachment 6 Rate Funded/Op Reserves Facilites Metering Improvements Pipeline Replacement Well Rehabilitation Glenshire Drive Discharge Assembly Martis Woods Pump Station Replacement Well &Pump Station Maintenance Tank Coating Water SCADA Replacement IT Projects Control Valve Rehabilitation Project Water Production Meter Project Total Rate Funded Capital Truckee Donner Public Utility District Water Capital Projects FY20 through FY29 Vehicles 160,000 270,000 200,000 200,000 200,000 200,000 200,000 200,000 200,000 200,000 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 999,330 --------- --1,000,000 2,000,000 1,500,000 1,545,000 1,591,350 1,639,091 1,688,263 1,738,911 101,100 121,777 --400,000 500,000 515,000 530,450 546,364 562,754 102,292 --------- -537,895 -------- --450,000 454,500 895,045 903,995 913,035 922,166 931,387 940,701 114,244 115,500 100,000 101,000 102,010 103,030 104,060 105,101 106,152 107,214 645,133 670,110 676,811 683,579 690,415 ----- 143,383 147,865 152,301 156,870 161,576 166,423 171,416 176,558 181,855 187,311 104,801 99,746 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 42,585 46,061 50,000 ------- 2,252,867 1,738,954 2,529,112 3,495,949 3,849,046 3,318,449 3,394,862 3,473,366 3,554,021 3,636,891 Funded from Vehicle Reserve Total Capital Projects 2,412,867 2,008,954 2,729,112 3,695,949 4,049,046 3,518,449 3,594,862 3,673,366 3,754,021 3,836,891