HomeMy WebLinkAbout4 Attachment 2 Final TDPUD PGO FS 2016
TRUCKEE DONNER
PUBLIC UTILITY DISTRICT
PRIMARY GOVERNMENT ONLY
Including Report of Independent Auditors
December 31, 2016 and 2015
TABLE OF CONTENTS
Report of Independent Auditors ……………………………………………………………………………………1
Management’s Discussion and Analysis…………………………………………………………………………..4
Financial Statements………………………………………………………………………………………………...9
Consolidated Statements of Net Position………………………………………………………………10
Consolidated Statements of Revenues, Expenses and Changes in Net Posit ion…………………13
Consolidated Statements of Cash Flows……………………………………………………………….14
Notes to Financial Statements…………………………………………………………………………………….16
Required Supplementary Information …….……………………………………………………………………..48
Cost Sharing Defined Benefit Pension Plans………………………………………………………….49
Position of Post Employment Benefit Plans……………………………………………………………51
Supplementary Information…….………………………………………………………………………………….52
Consolidating Statement of Net Position……………………………………………………………….53
Consolidating Statement of Revenues, Expenses and Changes in Net Position...………..………55
Consolidating Statement of Cash Flows………..……………………………………..…………....….56
.
TRUCKEE DONNER PUBLIC UTILITY DISTRICT
MANAGEMENT’S DISCUSSION AND ANALYSIS
December 31, 2016 and 2015
See accompanying auditors’ report.
Page 4
MANAGEMENT’S DISCUSSION AND ANALYSIS
As financial management of the Truckee Donner Public Utility District (the District), we offer readers of
these financial statements this narrative overview and analysis of the financial activities of the District for
the years ended December 31, 2016 and 2015. This discussion and analysis is designed to assist the
reader in focusing on the significant financial topics, provide an overview of the District’s financial activity
and identify changes in the District’s financial position.
We encourage readers to consider the information presented here in conjunction with that presented within
the basic financial statements. The reader should take time to read and evaluate all sections of this report,
including the footnotes and other supplementary information that is provided, in addition to this
management discussion and analysis.
FINANCIAL HIGHLIGHTS
The District’s current assets increased $0.7 million (2.4%) from $28.2 million at December 31, 2015 to $28.9
million at December 31, 2016, predominantly due to higher than anticipated revenues for the Electric Utility.
The District’s total net position increased $3.5 million (3.1%) from $109.7 million at December 31, 2015, to
$113.2 million at December 31, 2016. The increase was primarily due to a $3.4 million increase for the
Electric Utility.
Operating revenues increased $2.6 million (8.0%) from $33.0 million in 2015 to $35.6 million in 2016.
Electric revenues increased only 6.0% in 2015 as the District experienced higher energy consumption
related to an extreme winter resulting in high tourist visitation. Water revenues increased 11.8%; there was
a 6% rate increase in 2016 in addition to changes in the state mandated drought regulations.
Operating expenses of the District increased $2.2 million (6.6%) from $30.9 million in 2015 to $33.1 million
in 2016. Electric expense increased 6.9% and Water expense increased 7.1% primarily attributed to $1.4
million in additional expense for Pension and Other Post –Employee Benefits required to comply with GASB
68 and updated requirements for GASB 45.
Compared to 2015, the overall non-operating revenues remained nearly flat at $0.4 million in 2016 and
2015 respectfully. Non-operating expenses decreased $0.1 million from $1.1 million in 2015 to $1.0 million
in 2016.
In October 2016, the District had two bond refundings (refinance). For the Water Utility the remaining portion
of the 2006 COP was refunded providing the District with a net present value savings of just under $222,000
over the term of the bond. For the Electric Utility the Pension Sidefund Obligation Bond was refunded,
providing the District with a net present value savings of $164,000 over the term of the bond (See Note 5).
No other new debt was issued in 2016.
OVERVIEW OF THE FINANCIAL STATEMENTS
This report includes Management’s Discussion and Analysis, the Independent Auditors’ Report, the Basic
Financial Statements, (which includes the notes to the financial statements), Required Supplementary
Information and additional Supplementary Information.
TRUCKEE DONNER PUBLIC UTILITY DISTRICT
MANAGEMENT’S DISCUSSION AND ANALYSIS
December 31, 2016 and 2015
See accompanying auditors’ report.
Page 5
REQUIRED FINANCIAL STATEMENTS
The financial statements of the District are designed to provide readers with a broad overview of the
District’s finances similar to a private-sector business. They have been prepared using the accrual basis of
accounting in accordance with accounting principles generally accepted in the United States of America
(GAAP). Under this basis of accounting, revenues are recognized in the period in which they are earned
and expenses are recognized in the period in which they are incurred, regardless of the timing of related
cash flows. These statements offer short-term and long-term financial information about the District’s
activities.
The reporting entity consists of the primary government, which provides two utilities (electric utility and
water utility), and the blended component units. Further details about the component units are provided in
note 1(A).
The Consolidated Statements of Net Position presents information on all of the District’s assets and
liabilities, and provides information about the nature and amounts of investments in resources (assets) and
the obligations to District creditors (liabilities). It also provides the basis for computing rate of return,
evaluating the capital structure of the District, and assessing the liquidity and financial flexibility of the
District.
All of the current year’s revenues and expenses are reported in the Consolidated Statements of
Revenues, Expenses, and Changes in Net Position. This statement provides a measurement of the
District’s operations over the past year and can be used to determine whether the District has successfully
recovered all its costs through its rates and other charges.
The Consolidated Statements of Cash Flows provides relevant information about the District’s cash
receipts and cash payments during the reporting period. This statement reports cash receipts and cash
payments resulting from operating, non-capital financing, capital and related financing, and investing
activities. When used with related disclosures and information in the other financial statements, the
statement of cash flows should provide insight into (a) the District’s ability to generate futu re net cash flows,
(b) the District’s ability to meet its obligations as they come due, (c) the District’s needs for external
financing, (d) the reasons for differences between operating income and associated cash receipts and
payments, and (e) the effects on the District’s financial position of both its cash and its non-cash investing,
capital, and financing transactions during the period. The changes in cash balances are an important
indicator of the District’s liquidity and financial condition.
The Notes to the Financial Statements provide additional information that is essential to a full
understanding of the data provided in the basic financial statements. This includes but is not limited to,
significant accounting policies, significant financial stat ement balances and activities, material risks,
commitments and obligations, and subsequent events, as applicable.
TRUCKEE DONNER PUBLIC UTILITY DISTRICT
MANAGEMENT’S DISCUSSION AND ANALYSIS
December 31, 2016 and 2015
See accompanying auditors’ report.
Page 6
DISTRICT HIGHLIGHTS
The condensed financial statements at December 31, 2016, 2015, and 2014 are presented below.
The District implemented Governmental Accounting Standards Board (GASB) Statement of Governmental
Accounting Standards (SGAS) No. 68 “Accounting and Financial Reporting for Pensions – An Amendment
of GASB Statement No. 27” (GASB No. 68) in 2015. Under GASB no. 68, the District is required to report
the net pension liability and deferred inflows and outflows in the Statement of Net Position. Net Pension
Liability was $10.3 million, $8.0 million and $6.2 million at December 31, 2016, 2015 and 2014 respectfully.
Net long-term debt decreased $2.9 million, due to the annual reduction of existing debt. See note 5 for
details on remaining debt. The District had two refundings in 2016, the previously unrefunded portion of
the 2006 COP and the Pension Sidefund Obligation Bond which provide the District with net present value
savings of just under $386,000 over the remaining life of the bonds. No additional debt was issued in 2016
or 2015 respectfully. The District’s total net position increased $3.5 million, substantially due to increased
investment in capital assets for substations, pipeline replacement projects, pump stations, and the reliability
Increase
(Decrease)
OUTFLOWS OF RESOURCES 2016 2015 2014 2016 - 2015
Current assets 28,913,981$ 28,230,800$ 31,598,559$ 683,181$
Non-current assets:
Capital assets, net 123,602,331 122,416,668 119,322,462 1,185,663
Restricted assets 1,876,032 1,900,036 1,937,917 (24,004)
Other long-term assets 4,618,396 5,361,643 6,072,406 (743,247)
Total Assets 159,010,740 157,909,147 158,931,344 1,101,593
Deferred outflows of resources 4,764,564 3,274,459 500,632 1,490,105
TOTAL ASSETS AND
DEFERRED OUTFLOWS OF RESOURCES 163,775,304$ 161,183,606$ 159,431,976$ 2,591,698$
RESOURCES AND NET POSITION
Current liabilities 7,262,461$ 7,300,776$ 6,648,077$ (38,315)$
Non-current Liabilities
Long-term debt, net of current portion 27,642,726 30,583,770 34,652,693 (2,941,044)
Net pension liability 10,250,329 8,013,400 6,210,985 2,236,929
OPEB liability 719,217 - - 719,217
Unearned revenues 3,073,507 3,226,709 2,786,763 (153,202)
Total Liabilities 48,948,240 49,124,655 50,298,518 (176,415)
Deferred inflows of resources 1,597,126 2,341,737 2,168,674 (744,611)
NET POSITION
Net investment in capital assets 93,421,545 89,271,509 82,613,625 4,150,036
Restricted for debt service 6,011,469 5,762,124 7,768,818 249,345
Unrestricted 13,796,924 14,683,581 16,582,341 (886,657)
Total Net Position 113,229,938 109,717,214 106,964,784 3,512,724
TOTAL LIABILITIES, DEFERRED
INFLOWS OF RESOURCES
AND NET POSITION 163,775,304$ 161,183,606$ 159,431,976$ 2,591,698$
CONSOLIDATED STATEMENT OF NET POSITION
LIABILITIES, DEFERRED INFLOWS OF
ASSETS AND DEFERRED
TRUCKEE DONNER PUBLIC UTILITY DISTRICT
MANAGEMENT’S DISCUSSION AND ANALYSIS
December 31, 2016 and 2015
See accompanying auditors’ report.
Page 7
enhancement of the District’s computer servers. “Net investment in capital assets,” consist of capital
assets, net of accumulated depreciation, reduced by the amount of outstanding indebtedness attributable
to the acquisition, construction, or improvement of those assets. When there are significant unspent bond
proceeds, the portion of related debt is not included in the calculation of this item. Instead, that portion of
the debt is included in the net position restricted for capital projects component as an offset to the related
unspent bond proceeds.
“Restricted for debt service” represents amounts restricted for payments related to outstanding revenue
bonds.
The District had income before capital contributions of $1.8 million, $1.3 million, and $0.9 million for the
years ended December 31, 2015, 2014, and 2013, respectively. The District’s December 31, 2014 income
before capital contributions increased $0.2 million due to the required restatement for compliance with
GASB No. 68 first year implementation for pension accounting. Changes in the District’s net position can
be determined by reviewing the following Condensed Revenues, Expe nses, and Changes in Net Position
for the years ended December 31, 2015, 2014, and 2013.
Total operating revenues were $35.6 million in 2016, $33.0 million in 2015, and $32.6 million in 2014. In
2016, electric revenues increased 6.0% as the District experienced an active winter season compared to
prior years. Water revenues increased 11.8%; there was a 6% rate increase in 2016 in addition to changes
to the state mandated drought regulations.
Total operating expenses were $33.1 million in 2016, $30.9 million in 2015, and $30.9 million in 2014.
Electric expenses increased 6.9% and water expenses increased 7.1% primarily attributed to $1.4 million
in additional expense compared to 2015 for pension expense and other post -employment benefits in
compliance with GASB 68 and GASB 45 (see note 9).
Increase
(Decrease)
2016 2015 2014 2016 - 2015
Sales to consumers 33,026,587$ 30,818,856$ 30,331,953$ 2,207,731$
Other operating revenues 2,577,122 2,158,141 2,296,643 418,981
Total Operating Revenues 35,603,709 32,976,997 32,628,596 2,626,712
Operating expenses 33,101,672 30,892,366 30,879,299 2,209,306
Operating Income (Loss)2,502,037 2,084,631 1,749,297 417,406
Non-operating revenues (expenses)(688,423) (762,711) (826,268) 74,288
Income (loss) before
capital contributions 1,813,614 1,321,920 923,029 491,694
Capital contributions, net 1,699,110 1,430,510 994,056 268,600
Change in net position 3,512,724 2,752,430 1,917,085 760,294
Net Position, Beginning of Year 109,717,214 106,964,784 119,336,452 2,752,430
Less: Restatement for change in
accounting principal - - (14,288,753) -
Net Position, Beginning of Year, as adjusted 109,717,214 106,964,784 105,047,699 2,752,430
NET POSITION, END OF YEAR 113,229,938$ 109,717,214$ 106,964,784$ 3,512,724$
CONDENSED REVENUES, EXPENSES, AND CHANGES IN NET POSITION
TRUCKEE DONNER PUBLIC UTILITY DISTRICT
MANAGEMENT’S DISCUSSION AND ANALYSIS
December 31, 2016 and 2015
See accompanying auditors’ report.
Page 8
Non-operating revenues remained nearly flat in 2016 from 2015. Non-operating expenses decreased $0.1
million due to decreased interest expense from 2015 and savings acquired from the 2016 refundings of
existing debt (see note 5).
CAPITAL ASSETS
As of December 31, 2016, 2015, and 2014, the District had $123.6 million, $122.4 million, and $119.3
million, respectively, invested in a variety of capital assets, net of accumulated depreciation. A summary of
capital assets is reflected in the following schedule.
Net capital assets (additions, less retirements and depreciation) increased in 2016 $1.2 million. This
increase is primarily attributed to the Electric Utility’s replacement of sub-station equipment in addition to
the Water Utility’s ongoing replacement of the antiquated SCADA communication system in addition to
pump station maintenance and repairs and main water line replacements across the District.
LONG-TERM DEBT
Long-term debt includes revenue bonds and notes payable. At December 31, 2016, 2015, and 2014, the
District had $27.6 million, $30.6 million, and $34.7 million, respectively, in long-term debt outstanding, net
current maturities.
In October 2016, the remaining portion of the 2006 COP was refunded and the Pension Sidefund Obligation
Bond, was refunded saving the District $0.4 million over the remaining term of the bonds. No other new
debt was issued in 2016.
CONTACTING THE DISTRICT’S FINANCIAL MANAGEMENT
The financial report is designed to provide readers with a general overview of the District’s finances and to
demonstrate the District’s accountability for the money it receives. If you have questions about this report
or need additional financial information, contact:
Truckee Donner Public Utility District
Attn: Treasurer
11570 Donner Pass Road
Truckee, CA 9616
2016 2015 2014
Electric distribution facilities 58,345,690$ 54,721,615$ 51,524,863$
Water distribution facilities 108,860,825 107,005,578 103,049,122
General plant 15,062,278 13,887,881 12,816,635
Sub-totals 182,268,793 175,615,074 167,390,620
Less: Accumulated depreciation (63,372,738) (58,042,448) (54,475,747)
Net of accumulated depreciation 118,896,055 117,572,626 112,914,873
Construction work in progress 4,663,696 4,844,042 6,407,589
Net capital assets 123,559,751$ 122,416,668$ 119,322,462$
CAPITAL ASSETS
FINANCIAL STATEMENTS
TRUCKEE DONNER PUBLIC UTILITY DISTRICT
CONSOLIDATED STATEMENTS OF NET POSITION
December 31, 2016 and 2015
The accompanying notes are an integral part of these consolidated financial statements.
Page 10
ASSETS AND DEFERRED
OUTFLOWS OF RESOURCES 2016 2015
CURRENT ASSETS
Funds
Operating 7,852,130$ 6,616,354$
Designated 10,759,538 11,914,287
Restricted 4,293,285 4,061,391
Total Funds 22,904,953 22,592,032
Accounts receivable, net 1,820,173 1,639,096
Unbilled revenues 2,911,201 2,766,757
Accrued interest receivable 65,044 70,856
Materials and supplies 656,981 639,442
Prepaid expenses 459,264 436,902
Other 96,365 85,715
Total Current Assets 28,913,981 28,230,800
NON-CURRENT ASSETS
Other Non-Current Assets
Restricted funds 1,876,032 1,900,036
Special assessments receivable 3,692,876 4,363,790
Other 925,520 997,853
Total Other Non-Current Assets 6,494,428 7,261,679
DEFERRED OUTFLOWS OF RESOURCES
Pension 4,005,050 2,632,077
Unamortized loss on refunding 609,580 642,382
Unamortized redemption premium 149,934 -
Total Deferred Outflows of Resources 4,764,564 3,274,459
CAPITAL ASSETS
Utility plant 182,268,793 175,615,074
Accumulated depreciation (63,372,738) (58,042,448)
Construction work in progress 4,706,276 4,844,042
Total Capital Assets 123,602,331 122,416,668
TOTAL ASSETS AND DEFERRED
OUTFLOWS OF RESOURCES 163,775,304$ 161,183,606$
TRUCKEE DONNER PUBLIC UTILITY DISTRICT
CONSOLIDATED STATEMENTS OF NET POSITION
December 31, 2016 and 2015
The accompanying notes are an integral part of these consolidated financial statements.
Page 11
NET POSITION, LIABILITIES, AND
DEFERRED INFLOWS OF RESOURCES 2016 2015
CURRENT LIABILITIES
Other Liabilities
Accounts payable 2,506,514$ 2,983,101$
Customer deposits 468,168 423,502
Other 918,577 766,699
Total Other Liabilities 3,893,259 4,173,302
Current Liabilities Payable From Restricted Assets
Current portion of long-term debt 3,206,043 2,935,919
Accrued interest payable 163,159 191,555
Total Current Liabilities Payable from Restricted Assets 3,369,202 3,127,474
Total Current Liabilities 7,262,461 7,300,776
NON-CURRENT LIABILITIES
Long-term debt, net of discounts and premiums 27,584,323 30,209,240
Net pension liability 10,250,329 8,013,400
OPEB liability 719,217 -
Installment loans 58,403 374,530
Unearned revenues 3,073,507 3,226,709
Total Non-Current Liabilities 41,685,779 41,823,879
Total Liabilities 48,948,240 49,124,655
DEFERRED INFLOWS OF RESOURCES
Pension 1,597,126 2,341,737
Total Deferred Inflows of Resources 1,597,126 2,341,737
NET POSITION
Net investment in capital assets 93,421,545 89,271,509
Restricted for debt service 6,011,469 5,762,124
Unrestricted 13,796,924 14,683,581
Total Net Position 113,229,938 109,717,214
TOTAL NET POSITION, LIABILITIES, AND
DEFERRED INFLOWS OF RESOURCES 163,775,304$ 161,183,606$
T H I S P A G E I S I N T E N T I O N A L L Y L E F T B L A N K
TRUCKEE DONNER PUBLIC UTILITY DISTRICT
CONSOLIDATED STATEMENTS OF REVENUES,EXPENSES, AND CHANGES IN NET POSITION
December 31, 2016 and 2015
The accompanying notes are an integral part of these consolidated financial statements.
Page 13
2016 2015
OPERATING REVENUES
Sales to customers 33,026,587$ 30,818,856$
Standby fees 160,670 169,010
Cap and trade proceeds 1,172,306 965,402
Other 1,244,146 1,023,729
Total Operating Revenues 35,603,709 32,976,997
OPERATING EXPENSES
Purchased power 11,511,308 11,348,241
Operations and maintenance 6,951,273 6,804,271
Consumer services 2,130,422 2,159,522
Administration and general 4,331,827 4,054,439
Pension expense 1,220,591 565,373
OPEB expense 719,218 -
Depreciation 6,237,033 5,960,520
Total Operating Expenses 33,101,672 30,892,366
Operating Income 2,502,037 2,084,631
NON-OPERATING REVENUE (EXPENSES)
Investment income 368,761 385,731
Interest expense (897,993) (943,034)
Amortization (12,599) 15,355
Other non-operating expenses (145,078) (251,753)
Gain (loss) on disposition of assets (1,514) 30,990
Total Non-Operating Revenue (Expenses)(688,423) (762,711)
Income Before Contributions 1,813,614 1,321,920
CAPITAL & OTHER CONTRIBUTIONS 1,699,110 1,430,510
CHANGE IN NET POSITION 3,512,724 2,752,430
Net Position - Beginning of Year 109,717,214 106,964,784
NET POSITION - END OF YEAR 113,229,938$ 109,717,214$
TRUCKEE DONNER PUBLIC UTILITY DISTRICT
CONSOLIDATED STATEMENT OF CASH FLOWS
December 31, 2016 and 2015
.
The accompanying notes are an integral part of these consolidated financial statements.
Page 14
2016 2015
CASH FLOWS FROM OPERATING ACTIVITIES
Received from customers 35,177,778$ 32,950,562$
Paid to suppliers for goods and services (19,476,138) (18,507,965)
Paid to employees for services (6,432,772) (6,159,526)
Net Cash Flows from Operating Activities 9,268,868 8,283,071
CASH FLOWS FROM NONCAPITAL FINANCING ACTIVITIES
Debt issuance costs 78,838 -
Proceeds from refunding 5,353,413 -
Principal payments on long-term debt (6,102,838) (593,000)
Interest payments on long-term debt (250,584) (301,725)
Net Cash Flows from Noncapital Financing Activities (921,171) (894,725)
CASH FLOWS FROM CAPITAL AND RELATED
FINANCING ACTIVITIES
Capital expenditures for utility plant (7,421,152) (9,014,992)
Cost of disposal of property net of salvage (78,431) (109,189)
Capital contributions, connection and facility fees 1,356,731 1,703,180
Special assessments receipts 670,914 648,531
Debt issuance costs 66,240 251,754
Proceeds from refunding 3,128,760 14,781,118
Principal payments on long-term debt (5,497,159) (18,553,445)
Interest payments on long-term debt (648,788) (1,309,070)
Cash Flows From Capital and Related Financing Activities (8,422,885) (11,602,113)
CASH FLOWS FROM INVESTING ACTIVITIES
Interest income received 406,993 413,723
Cash Flows from Investing Activities 406,993 413,723
Net Change in Cash and Cash Equivalents 331,805 (3,800,044)
CASH AND CASH EQUIVALENTS – Beginning of Year 22,593,595 26,393,639
CASH AND CASH EQUIVALENTS – END OF YEAR 22,925,400$ 22,593,595$
NONCASH CAPITAL AND RELATED FINANCING ACTIVITIES
Developer and customer added capital assets 189,176$ 167,277$
Recognition of prior period unearned revenues 3,309,061$ 3,014,152$
TRUCKEE DONNER PUBLIC UTILITY DISTRICT
CONSOLIDATED STATEMENT OF CASH FLOWS
December 31, 2016 and 2015
.
The accompanying notes are an integral part of these consolidated financial statements.
Page 15
2016 2015
RECONCILIATION OF OPERATING INCOME TO NET CASH
FLOWS FROM OPERATING ACTIVITIES
Operating income 2,502,037$ 2,084,631$
Noncash items included in operating income
Depreciation and amortization 6,237,033 5,960,520
Depreciation charged to other accounts 264,368 267,722
Pension expense - GASB 68 1,180,590 565,373
Deferred Pension Contributions - GASB 68 (1,061,245) (721,340)
OPEB 719,218 -
Changes in assets and liabilities
Accounts receivable and unbilled revenues (325,520) (236,166)
Materials and supplies (17,539) (4,625)
Prepaid expenses and other current assets (22,362) (182,620)
Accounts payable (476,588) 397,822
Customer deposits 44,668 2,152
Other current liabilites 224,208 149,602
NET CASH FLOWS FROM OPERATING ACTIVITES 9,268,868$ 8,283,071$
RECONCILIATION OF CASH AND CASH EQUIVALENTS
TO THE BALANCE SHEET
Operating 7,852,130$ 6,616,354$
Designated 10,759,538 11,914,287
Restricted funds - current 4,293,285 4,061,391
Restricted funds - non-current 1,876,032 1,900,036
Total Cash and Investments 24,780,985 24,492,068
Less: Long-term investments (1,698,880) (1,698,880)
Mark to market adjustments (156,705) (199,593)
TOTAL CASH AND CASH EQUIVALENTS 22,925,400$ 22,593,595$
TRUCKEE DONNER PUBLIC UTILITY DISTRICT
NOTES TO FINANCIAL STATEMENTS
December 31, 2016 and 2015
.
The accompanying notes are an integral part of these consolidated financial statements.
Page 16
NOTE 1 – ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
A. ORGANIZATION
The Truckee Donner Public Utility District (the District) was formed and operates under the State of
California Public Utility District Act. The District is governed by a board of directors which consists of five
elected members. The District provides electric and water service to portions of Nevada and Placer
Counties described as Truckee. The electric and water service operat ions are separately maintained and
operated. These financial statements reflect the combined electric and water operations of the District. All
significant transactions between electric and water operations have been eliminated. These eliminations
include power purchases and rent for shared facilities.
The District’s blended component units consist of organizations whose respective governing boards are
comprised entirely of the members of the District’s Board of Directors. These organizations are reported as
if they are a part of the District’s operations. Th e entities are legally separate; however, in the case of the
Truckee Donner Public Utility District Financing Corporation, financial support has been pledged and
financial and operational policies may b e significantly influenced by the District.
The financial results of these blended component units are not included in this report. However,
the District has issued an additional consolidated report that includes these component units. A
copy of that report can be requested from the District.
The following is a description of the District’s blended component units:
Truckee Donner Public Utility District Financing Corporation is a legal entity that was created to issue and
administer Certificates of Participation on behalf of the District. (See note 5).
Separate standalone financial statements are not available for the blended component units described
above. Unless noted, disclosures relating to the component units are the same as for the District.
B. ACCOUNTING POLICIES
The financial statements of the District have been prepared in conformity with accounting principles
generally accepted in the United States of America. The Governmental Accounting Standards Board
(GASB) is the accepted standard setting body for establishing governmental accounting and financial
reporting principles.
The financial statements are reported using the economic resources measurement focus and the accrual
basis of accounting. Under the accrual basis of accounting, revenues are recognized when earned and
expenses are recorded when the liability is incurred or economic asset used. Revenues, expenses, gains,
losses, assets and liabilities, that are a result of exchange and exchange like transactions, are recognized
when the exchange takes place.
TRUCKEE DONNER PUBLIC UTILITY DISTRICT
NOTES TO FINANCIAL STATEMENTS
December 31, 2016 and 2015
.
The accompanying notes are an integral part of these consolidated financial statements.
Page 17
NOTE 1 – ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
C. USE OF ESTIMATES
Preparation of financial statements in conformity with accounting principles generally accepted in the United
States of America requires management to make estimates and assumptions that affect the reported
amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses during the reporting period. Actual results
could differ from those estimates.
D. CASH AND CASH EQUIVALENTS
For the purpose of the accompanying statement of cash flows, the District considers all highly liquid
instruments with original maturities of three months or less when purchased to be cash equivalents.
E. INVESTMENTS
The District pools cash and investments. The District’s investment policy allows for investments in
instruments permitted by the California Government Code and/or the investments permit ted by the trust
agreements on District financing. The District’s investment policy contains provisions intended to limit the
District’s exposure to interest rate risk, credit risk, and concentration of credit risk. Investment income from
pooled investments is allocated to all funds in the pool. Interest is allocated on the basis of month end cash
amounts for each fund as a percentage of the total balance.
The District categorizes the fair value measurements of its investments based on the hierarchy est ablished
by generally accepted accounting principles. The fair value hierarchy, which has three levels, is based on
the valuation inputs used to measure an assets fair value: Level 1 inputs are quoted prices in active markets
for identical assets; Level 2 inputs are significant other observable inputs; Level 3 inputs are significant
unobservable inputs. The District does not have any investments that are measured using Level 3 inputs.
F. DESIGNATED ASSETS
The board has designated certain resources for future capital projects, replacements, and operational
needs.
G. RESTRICTED ASSETS
Restricted assets are assets restricted by the covenants of long-term financial arrangements or other third
party legal restrictions. Restricted assets are used in accordance with their requirements and where both
restricted and unrestricted resources are available for use, restricted resources are used first and then
unrestricted as they are needed.
H. ACCOUNTS RECEIVABLE AND ALLOWANCES FOR DOUBTFUL ACCOUNTS
Accounts receivable are recorded at the invoiced amount and are reported net of allowances for doubtful
accounts of $34,300 and $51,000 for 2016 and 2015, respectively.
I. MATERIALS AND SUPPLIES
Materials and supplies are recorded at average cost.
TRUCKEE DONNER PUBLIC UTILITY DISTRICT
NOTES TO FINANCIAL STATEMENTS
December 31, 2016 and 2015
.
The accompanying notes are an integral part of these consolidated financial statements.
Page 18
NOTE 1 – ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
J. DEBT PREMIUM, BOND ISSUANCE COSTS, AND DISCOUNTS
Original issue and reacquired bond premiums and discounts relating to revenue bonds are amortized over
the terms of the respective bond issues using the effective interest method. Bond issuance costs are
expensed in the period incurred.
K. SPECIAL ASSESSMENT RECEIVABLE
Special assessment receivable represent amounts due from property owners within the Donner Lake
Assessment District for improvements made by the District pursuant to an agreement with the property
owners to improve their water quality as discussed in note 7.
L. AMORTIZED EXPENSES
In 2003, the District entered into a broadband dark fiber maintenance agreement with Sierra Pacific
Communications (SPC) which is included in the line item “other non-current assets” in the accompanying
Statement of Net Position. SPC subsequently assigned the agreement to AT&T. The agreement is expected
to provide benefit to the District over the estimated 20-year life of the agreement. (See note 4).
M. CAPITAL ASSETS
Capital assets are generally defined by the District as assets with an initial, individual cost of more than
$10,000 and an estimated useful life of at least two years.
Capital assets of the District are stated at the lower of cost or the fair market value at the time of contribution
to the District. Major outlays for plant are capitalized as projects are constructed. Depreciation on capital
assets is calculated using the straight-line method over the estimated useful lives of the assets, which are
as follows:
Distribution Plant
Electric 23 – 35 years
Water 15 – 40 years
Computer software and hardware 3 – 7 years
Building and improvements 20 – 33 years
Equipment and furniture 4 – 10 years
It is the District’s policy to capitalize interest paid on debt incurred for significant construction projects while
those projects are under construction, less any interest earned on related unspent debt proceeds. No new
debt related to capital assets was issued in 2015 and 2014; no interest was capitalized in 2015 or in 2014.
N. COMPENSATED ABSENCES
Under terms of employment, employees are granted sick leave and vacations in varying amounts. Only
benefits considered to be vested are disclosed in these statements. Vested vacation and sick leave pay is
accrued when earned in the financial statements. The liability is liquidated from general operating revenues
of the utility.
TRUCKEE DONNER PUBLIC UTILITY DISTRICT
NOTES TO FINANCIAL STATEMENTS
December 31, 2016 and 2015
.
The accompanying notes are an integral part of these consolidated financial statements.
Page 19
NOTE 1 – ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
O. REVENUE RECOGNITION
The District records estimated revenues earned, but not billed to customers, as of the end of the year.
Revenues are recorded as meters are read on a cycle basis throughout each month for electric and water
customers. Unbilled revenues, representing estimated consumer usage for the period between the last
meter reading and the end of the period, are accrued in the period of consumption. Water customers without
meters are billed on a flat-rate basis, and revenues are recorded as billed. Revenues from connection fees
are recognized upon completion of the connection. Income that the District has earned through investing
its excess cash is reflected within income from investments when earned.
P. REVENUE AND EXPENSE CLASSIFICATION
The District distinguishes operating revenues and expenses from non-operating items in the preparation of
its financial statements. Operating revenues and expenses generally result from providing electric and
water services in connection with the District’s principal ongoing operations. The principal operating
revenues are sales to customers. The District’s operating expenses include power purchases, labor,
materials, services, and other expenses related to the delivery of electric and water services. All revenues
and expenses not meeting this definition are reported as non-operating revenues and expenses, or capital
contributions and other.
Q. POWER PURCHASES AND TRANSMISSION
In 1999, the District entered into an agreement with Sierra Pacific Power C ompany dba NV Energy
(SPPC), whereby SPPC will provide transmission services to the District through December 31, 2027. In
addition, the District purchases scheduling services from Utah Municipal Power Systems and the
scheduling services are included in the monthly power billings from UAMPS. The purchase of
transmission services from NV Energy represented 5.1% and 4.1% of total purchased power costs in
2015 and 2016, respectively.
In December of 2005, the District entered into an agreement with UAMPS. Subsequently, the District
entered into many pooling appendices for power capacity and energy that relate to various time periods
from January 2008 through March 2028. Also in 2009, the District signed an agreement with UAMPS for
approximately 5 MW of the Nebo natural gas generation plant capacity. In August 2012, the Horse Butte
Wind project began commercial operation and the District owns approximately 15 MW of nameplate
capacity that generates about 5 MW on average. The District has also invested in the Veyo Heat
Recovery project that came on line in mid-2016. The District will expect about 1.7 MW of carbon free
generation from this generation source.
In August of 2007, the District entered into an agreement with Western Area Power Administration
(WAPA) for the delivery of Stampede Dam Hydro generation. In accordance with this agreement, the
District is entitled to a portion of the power generated by the Stampede Dam Hydro generation. This
generation is dependent upon the amount of water that is made available to the generator. This
agreement is effective through 2024.
In 2016 and 2015, the UAMPS contract, along with its appendices, and the WAPA contract for Stampede
Dam Hydro comprised the majority of a diversified power portfolio that balanced risk and cost for the
District.
TRUCKEE DONNER PUBLIC UTILITY DISTRICT
NOTES TO FINANCIAL STATEMENTS
December 31, 2016 and 2015
.
The accompanying notes are an integral part of these consolidated financial statements.
Page 20
NOTE 1 – ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
R. CAP AND TRADE PROGRAM PROCEEDS
California Assembly Bill 32 (AB32) is an effort by the State of California to set a 2020 greenhouse gas
(GHG) em issions reduction goal into law. AB32 requires California to lower greenhouse gas emissions to
1990 levels by 2020. Central to this initiative is the implementation of a cap and trade program, which covers
major sources of GHG emissions in the State including power plants. The California Cap and Trade
Program is designed to achieve cost-effective emissions reductions across the capped sectors. T he
program sets maximum statewide GHG emissions for all covered sectors each year (“cap”), and allows
covered entities to sell off allowances (“trade”). An allowance is a tradable permit that allows the emission
of one metric ton of CO2 that they do not need. The California carbon price is driven by allowance trading.
The District is subject to AB32 and has excess allowances due to reducing carbon-based generation in its
power portfolio.
In 2016 and 2015, the District sold its excess allowances in the program auctions and the proceeds were
recorded as $1,172,306 and $965,402 operating revenue for the respective years. The auction proceeds
are held in a restricted fund and are used to purchase qualified renewable power. (See note 2).
S. INCOME TAXES
As a government agency, the District is exempt from payment of federal and state income taxes.
T. CONTRIBUTED CAPITAL ASSETS
A portion of the District’s capital assets have been obtained through amounts charged to developers for
plant constructed by the District; direct contributions of capital assets from developers and other parties; as
well as assessments of local property owners. These items are recognized within capital assets as
construction is completed for plant constructed by the District based on the cost of the items, when received
for contributed capital assets based on the actual or estimated fair value of the c ontributed items, or upon
completion of the related project for development agreements. The District records amounts received within
capital contributions when a legally enforceable claim is established. Until the District meets the criteria to
record the amounts described above as capital contributions, any amounts received are recorded within
unearned revenues on the Statement of Net Position.
U. OTHER – PENSION SIDEFUND
As a result of implementing GASB Statement No. 68, the pension side-fund payoff that occurred in 2011
and which had been reported in the financial statements as an asset was written off due to the District’s
participation in CalPERS cost-sharing multi-employer retirement benefit plan. However, the liability for the
payoff remains until paid in full thru 2022. The intercompany fund transfers for the principal portion of the
debt service between the electric and water utility is included as “other.”
V. PENSION
For purposes of measuring the net pension liability and deferred outflows/inflows of resources related to
pensions, and pension expense, information about the fiduciary net position of the District’s California Public
Employee’s Retirement System (CalPERS) plans (Plans) and the additions to/deductions from the Plans’
fiduciary net position have been determined on the same basis as they are reported by CalPERS. For this
purpose, benefit payments (including refunds of employee contributions) are recognized when due and
payable in accordance with the benefit terms. Investments are reporte d at fair value.
TRUCKEE DONNER PUBLIC UTILITY DISTRICT
NOTES TO FINANCIAL STATEMENTS
December 31, 2016 and 2015
.
The accompanying notes are an integral part of these consolidated financial statements.
Page 21
NOTE 1 – ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
W. RECENT ACCOUNTING PRONOUNCEMENTS IMPLEMENTED BY THE DISTRICT
In June 2012, GASB issued Statement No. 68, “Accounting and Financial Reporting for Pensions – An
Amendment of GASB Statement No. 27.” The primary objective of this statement is to improve accounting
and financial reporting by state and local governments for pensions by requiring recognition of the entire
net pension liability and a more comprehensi ve measure of pension expense. This statement establishes
standards for measuring and recognizing liabilities, deferred outflows and deferred inflows of resources,
and expenses/expenditures. For defined benefit pensions, this statement identifies the metho ds and
assumptions that should be used to project benefit payments, discount projected benefit payments to their
actuarial present value, and attribute that present value to periods of employee service. In November 2013,
GASB issued Statement No. 71, “Pension Transition for Contributions Made Subsequent to the
Measurement Date – an amendment of GASB Statement No. 68.” This statement requires that at transition,
the district recognize a beginning deferred outflow of resources for pension contributions, if a ny, made
subsequent to the measurement date of the beginning net pension liability. The District implemented the
statement effective December 31, 2014.
In February 2015, GASB issued Statement No. 72, Fair Measurement and Application. This statement
addresses accounting and financial reporting issues related to fair value measurements. This statement
provides guidance for applying fair value to certain investments and disclosures related to all fair value
measurements. The District implemented the statement in the current year.
In March 2016, GASB issued Statement No. 82, Pension Issues, an amendment of GASB Statements No.
67, No. 68, and No. 73. The primary objective of this statement is to address issues regarding (1)
presentation of payroll-related measures in required supplementary information, (2) selection of
assumptions and the treatment of deviations from the guidance in an Actuarial Standard of Practice for
financial reporting purposes, and (3) the classification of payments made by employers t o satisfy employee
(plan member) contribution requirements. The District implemented the statement in the current year.
X. DEFERRED OUTFLOWS OF RESOURCES AND DEFERRED INFLOWS OF RESOURCES
Consists of deferrals for changes in the net pension liability as defined under GASB Statement No. 68.
Y. UNAMORTIZED LOSS ON BOND REFUNDING
For current and advanced refunding results in defeasance of debt, the difference between the reacquisition
price and the net carrying amount of the old debt (Gain or loss) is deferred and amortized as a component
of interest expense over the remaining life of the old debt or the new debt, whichever is shorter. These
amounts are reported as deferred outflow on the statements of net position.
Z. ACCOUNTING PRONOUNCEMENTS TO BE IMPLEMENTED IN UPCOMING YEARS
GASB Statement No. 75, Accounting and Financial Reporting for Postemployment Benefits Other Than
Pensions, addresses accounting and financial reporting for OPEB that is provided to the employees of state
and local governmental employers. This Statement establishes standards for recognizing and measuring
liabilities, deferred outflows of resources, deferred inflows of reso urces, and expense/expenditures. This
statement is effective for the District fiscal year ending December 31, 2017. The District has elected not to
implement GASB Statement No. 75 early and has not determined its effect on the District’s financial
statements.
TRUCKEE DONNER PUBLIC UTILITY DISTRICT
NOTES TO FINANCIAL STATEMENTS
December 31, 2016 and 2015
.
The accompanying notes are an integral part of these consolidated financial statements.
Page 22
NOTE 1 – ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
Z. ACCOUNTING PRONOUNCEMENTS TO BE IMPLEMENTED IN UPCOMING YEARS
(CONTINUED)
GASB Statement No. 83, Certain Asset Retirement Obligations, addresses accounting and financial
reporting for certain asset retirement obligations (ARO’s). The District has not determined what impact, if
any, this pronouncement will have on the financial statements. Application of this statement is effective for
the District’s fiscal year ending December 31, 2018.
NOTE 2 – CASH, CASH EQUIVALENTS, AND INVESTMENTS
Cash, cash equivalents and investments are recorded in accounts as either restricted or unrestricted as
required by the District’s certificates of participation indentures or other third-party legal restrictions.
Restricted assets represent funds that are restricted by certificates of participation c ovenants or third party
contractual agreements. Assets that are allocated by resolution of the Board of Directors are considered to
be Board designated assets. Board designated assets are a component of unrestricted assets as their use
may be redirected at any time by approval of the Board. Upon Board approval, assets from board
designated accounts may be used to pay for selected capital projects. Such accounts have been designated
by the Board for the following purposes:
Electric Capital Replacement
Starting in 2009, the Board set aside funds designated for future electric infrastructure replacement.
Electric Vehicle Reserve
Beginning in 2009, the Board set aside funds designated for future electric utility vehicle
replacements.
Electric Rate Reserve
In compliance with Board rules, the District created an electric rate stabilization fund in anticipation
of future costs. During both 2016 and 2015, there was no utilization of these funds to offset
increased power costs in lieu of raising electric rates.
Reserve for Future Meters
Prior to 1992, connection fees charged to applicants for water service included an amount, which
was maintained in a designated fund, to offset the cost of future metering. In 2008, the Board
adopted an ordinance to charge a $5 monthly surcharge to all customers of treated water beginning
January 2009 through December 2013. Water meters and automated meter reading devices are
being installed, and customers will be billed volumetrically in accordance with California Assembly
Bill 2572. As meters are installed, these funds are used to pay for related costs.
Water Vehicle Reserve
Beginning in 2009, the Board set aside funds designated for future water utility vehicle
replacements.
TRUCKEE DONNER PUBLIC UTILITY DISTRICT
NOTES TO FINANCIAL STATEMENTS
December 31, 2016 and 2015
.
The accompanying notes are an integral part of these consolidated financial statements.
Page 23
NOTE 2 – CASH, CASH EQUIVALENTS, AND INVESTMENTS (Continued)
Prepaid Connection Fees
In compliance with Board rules, the District has set aside prepaid connection fees to cover
installation costs of water services.
Debt Service Coverage and Operating Reserve Fund
Effective 2007, the Board has voluntarily set aside funds to improve the District’s cash-to-debt-
service ratio. In 2016, funds were used for capital projects.
Donner Lake Assessment District Surcharge Fund
The District established a monthly billing surcharge in the amount of $6.65 applic able to customers
in the Donner Lake area to provide revenue to pay the remainder of the cost of reconstruction
effective October 2006.
As of December 31, board designated accounts consisted of the following:
Certain assets have been restricted by bond covenants or third party contractual agreements for the
following purposes:
Certificates of Participation: Water
In 2015, a portion of the 2006 Certificates of Participation were refunded. The new 2015 refunding
did not require a reserve fund. The reserve fund was liquidated and applied towards reducing the
debt principal remaining funds are for scheduled debt service.
In 2016, the remaining 2006 Certificates of Participation were refunded.
2016 2015
Electric capital replacement fund 3,428,129$ 3,364,783$
Electric vehicle reserve 378,880 351,761
Electric rate reserve 4,400,251 4,039,629
Reserve for future meters 533,777 632,967
Water vehicle reserve - 79,352
Prepaid connection fees 79,181 79,869
Debt service & operating reserve fund 1,847,559 3,283,853
Donner Lake Assessment District surcharge fund 91,760 82,073
Totals 10,759,537$ 11,914,287$
TRUCKEE DONNER PUBLIC UTILITY DISTRICT
NOTES TO FINANCIAL STATEMENTS
December 31, 2016 and 2015
.
The accompanying notes are an integral part of these consolidated financial statements.
Page 24
NOTE 2 – CASH, CASH EQUIVALENTS, AND INVESTMENTS (Continued)
Facilities Fees
The District charges facilities fees to applicants for new service to cover the costs of infrastructure
needed to meet their systems demand. The use of such funds is restricted by California state law.
Department of Water Resources (DWR) Prop 55 Reserve Fund
Regulations relating to the Department of Water Resources loan require the accumulation of a
reserve fund as security for each principal and interest payment as they come due. Annual
payments into the fund were required for each of the first ten years beginning April 1, 1996. The
total reserve fund equals two semi-annual payments and was fully funded during 2006. These funds
are set aside for the life of the borrowed amount. All of the reserve funds are invested in the St ate
of California Local Agency Investment Fund.
Glenshire Escrow Account
The District received cash and other assets as part of its acquisition of the Glenshire Mutual Water
Company. Also, the District will continue to receive a monthly water system upgrade surcharge
from Glenshire residents until November 30, 2017. This cash is utilized to pay the installment loan
related to the Glenshire water system improvements as specified in the terms of the acquisition
agreement.
In 2011, the District sold a parcel from the Glenshire Mutual Water Company assets. The net
proceeds of $294,940 were transferred to the Glenshire Escrow Account and the monthly water
system upgrade surcharge was reduced from $10.75 to $4.75.
Donner Lake Special Assessment District Improvement and Reserve Fund
The District established the Donner Lake Special Assessment District (DLAD) Improvement Fund
to account for all funds received from the Special Assessment Receivable, which will be used to
pay the debt service costs related to the Donner Lake Water System project. The DLAD
Improvement Fund also has a reserve fund as required by the California – Safe Drinking Water –
State Revolving Fund (SRF). This fund is required to set aside $40,043 semi-annually for ten years
beginning in 2006.
Solar Initiative Fund
The California Solar Initiative Senate Bill 1 (SB1) was enacted in 2006, mandating that all publicly-
owned electric utilities within the State of California, prepare, adopt and implement a solar rebate
program by January 2008 to encourage its customers to install solar energy systems.
In 2007, the Board adopted a rebate program effective January 2008, targeting $177,400 annually
over ten years to be used as rebates for the installation of solar electricity systems and to rais e
these funds through a customer surcharge.
In 2016 and 2015, the rebate program exceeded rebate collections eliminating the need to restrict
rebate proceeds. In 2016, the required rebates were awarded ending the SB1 rebate program.
The monthly SB1 customer charge will continue through 2017 so the District electric utility will be
reimbursed for advancing the rebates through 2017.
TRUCKEE DONNER PUBLIC UTILITY DISTRICT
NOTES TO FINANCIAL STATEMENTS
December 31, 2016 and 2015
.
The accompanying notes are an integral part of these consolidated financial statements.
Page 25
NOTE 2 – CASH, CASH EQUIVALENTS, AND INVESTMENTS (Continued)
AB32 Cap and Trade Auction Fund
California Assembly Bill 32 (AB32) is an effort by the State of California to set a 2020 greenhouse
gas (GHG) emissions reduction goal into law. AB32 requires California to lower greenhouse gas
emissions to 1990 levels by 2020. Central to this initiative is the implementation of a cap and trade
program, which covers major sources of GHG emissions in the State including power plants. The
California Cap and Trade Program is designed to achieve cost-effective emissions reductions
across the capped sectors. The program sets maximum statewide GHG emissions for all covered
sectors each year (“cap”), and allows covered entities to sell off allowances (“trade”). An allowance
is a tradable permit that allows the emission of one metric ton of CO2 that they do not need. The
California carbon price is driven by allowance trading. The District is subject to AB32 and has
excess allowances due to reducing carbon-based generation in its power portfolio.
The District electric utility is identified as an “Electric Distribution Utility” under the Ca p and Trade
regulations and is therefore eligible to receive a direct allocation of allowances that can be sold in
an auction. The proceeds from quarterly allowance auctions are held in this restricted fund and
are used to purchase qualified renewable power. These funds are intended to mitigate the burden
on the consumer without impacting a carbon price signal.
Other (Area Improvement Funds)
The District received funds from the County of Nevada, which are to be used only for improvements
to specific areas within the District’s boundaries in Nevada County. These areas include various
Nevada County assessment districts.
As of December 31, restricted cash and cash equivalents and investments consisted of the following:
2016 2015
Certificates of Participation 537,586$ 641,699$
Facilities fees 607,235 514,264
DWR-Prop 55 reserve fund 315,571 312,670
Glenshire escrow accounts 95,695 175,403
Donner Lake Special Assessment District improvement 2,593,139 2,517,494
Donner Lake Special Assessment District reserve fund 804,801 800,852
AB 32 Cap and Trade Auction fund 1,163,035 947,269
Other (area improvement funds)52,256 51,776
Total Restricted Cash and Cash
Equivalents and Investments 6,169,318$ 5,961,427$
TRUCKEE DONNER PUBLIC UTILITY DISTRICT
NOTES TO FINANCIAL STATEMENTS
December 31, 2016 and 2015
.
The accompanying notes are an integral part of these consolidated financial statements.
Page 26
NOTE 2 – CASH, CASH EQUIVALENTS, AND INVESTMENTS (Continued)
Cash and investments are comprised of the following cash and cash equivalents and investments as of
December 31:
Cash and cash equivalents and investments were $24,737,083 and $24,492,068 at December 31, 2016
and 2015, respectively. Cash equivalents substantially consist of deposits in the state pooled fund, Placer
County pooled fund, money market funds, and government bonds. For purposes of the Statements of Cash
Flows, the District considers all highly liquid instrume nts with original maturities of three months or less to
be cash equivalents.
Adjustments necessary to record investments at market value are recorded in the operating statement as
increases or decreases in investment income. Market values may have changed significantly after year
end.
FAIR VALUE MEASUREMENT
The District applies the provisions of Governmental Accounting Standards Board (GASB) Statement No.
72, Fair Value Measurement and Application, which requires governmental entities, to report certain
investments at fair value on the Statements of Net Position.
Investments are valued at fair value at December 31. Fair value is defined as the price that would be
received to sell an asset or paid to transfer a liability in an orderly transaction between market participants
at the measurement date. The District categorizes its fair value measurements within the fair value
hierarchy established by generally accepted accounting principles. The hierarchy is based on the valuation
inputs used to measure the fair value of the asset. Level 1 inputs are quoted prices for identical instruments
in active markets. Level 2 inputs are quoted prices for similar instruments in active markets; quoted prices
for identical or similar instruments in markets that are not active; and model derived valuations in which all
significant inputs are observable. Level 3 inputs are valuations derived from valuation techniques in which
significant inputs are unobservable.
The District classifies its fair value measurements wit hin the fair value hierarchy established by generally
accepted accounting principles. The district as the following fair value measurements as of December 31,
2016:
• US Government bonds and Money Market Funds are valued using observable inputs
(Level 2 inputs).
2016 2015
Cash and cash equivalents 22,881,498$ 22,593,595$
Mark to market adjustment 156,705 199,593
Investments – government bonds 1,698,880 1,698,880
Totals 24,737,083$ 24,492,068$
TRUCKEE DONNER PUBLIC UTILITY DISTRICT
NOTES TO FINANCIAL STATEMENTS
December 31, 2016 and 2015
.
The accompanying notes are an integral part of these consolidated financial statements.
Page 27
NOTE 2 – CASH, CASH EQUIVALENTS, AND INVESTMENTS (Continued)
INVESTMENTS AUTHORIZED BY THE DISTRICT’S INVESTMENT POLICY
The District adopted an investment policy in 2006 which allowed for investments in instruments permitted
by the California Government Code and/or the investments permitted by the trust agreements on District
financing, including investments in the local government investment fund pool administered by the State of
California (LAIF), Placer County Treasurer’s Investment Portfolio (PCTIP) pooled investment, and Utah
Public Treasurers’ Investment Fund (UPTIF). The District’s investment policy contains provisions intended
to limit the District’s exposure to interest rate risk, credit risk, and concentration of credit risk. At December
31, 2016 and 2017 the District’s deposits and investments were held as follows:
DISCLOSURES RELATING TO INTEREST RATE RISK
Interest rate risk is the risk that changes in the market interest rates will adversely affect the fair value of an
investment. Generally, the longer the maturity of an investment, the greater is the sensitivity of its fair value
to changes in market interest rates. Information about the sensitivity of the fair values of the District’s
investments to market interest rate fluctuations is provided by the following table that shows the District’s
investments by maturity for 2015 and 2014:
Investment and Deposits Maturity
LAIF 3 months or less
PCTIP 3 months or less
UPTIF 3 months or less
Fidelity Money Market Government Portfolio 57 3 months or less
Dreyfus Treasury Securities 3 months or less
Federal Farm Credit Banks 03/02/2021
DISCLOSURES RELATING TO CREDIT RISK
Generally, credit risk is the risk that an issuer of an investment will not fulfill its obligation to the holder of
the investment. This is measured by the assignment of a rating by a nationally recognized statistical rating
organization. LAIF, PCTIF and UPTIF do not have a rating provided by a nationally recognized statistical
rating organization. Federal Farm Credit Banks is rated AA+ by S&P and Aaa by Moody’s. The Dreyfus
Treasury Securities is rated Aaa-mf by Moody’s and AAAm by S&P. The Fidelity Money Market is rated
AAA-mf by Moody’s and AAAm by S&P.
2016 2015
Cash on hand 2,400$ 2,400$
Deposits 964,122 765,514
LAIF 8,006,871 5,978,324
PCTIP 6,853,226 8,447,363
UPTIF 6,944,706 7,157,158
Money Market Funds 133,628 241,273
Government Bonds 1,876,032 1,900,036
Totals 24,780,985$ 24,492,068$
TRUCKEE DONNER PUBLIC UTILITY DISTRICT
NOTES TO FINANCIAL STATEMENTS
December 31, 2016 and 2015
.
The accompanying notes are an integral part of these consolidated financial statements.
Page 28
NOTE 2 – CASH, CASH EQUIVALENTS, AND INVESTMENTS (Continued)
CUSTODIAL CREDIT RISK
Custodial credit risk for deposits is the risk that, in the event of the failure of a depository financial institution,
a government will not be able to recover its deposits or will not be able to recover collateral securities that
are in the possession of an outside party. The District’s investment policy does not contain legal or policy
requirements that would limit the exposure to custodial credit risk for dep osits. However, the California
Government Code requires that a financial institution secure deposits made by state or local governmental
units by pledging securities in an undivided collateral pool held by a depository regulated under state law
(unless waived by the government unit). The market value of pledged securities in the collateral pool must
equal at least 110% of the total amount deposited by the public agencies.
As of December 31, 2016 and 2015 all deposits were fully insured or collateralized.
The custodial credit risk for investments is the risk that, in the event of the failure of the counterparty (e.g.,
broker/dealer) to a transaction, a government will not be able to recover the value of its investment or
collateral securities that are in the possession of another party. The California Government Code and the
District’s investment policy do not contain legal or policy requirements that would limit the exposure to
custodial credit risk for investments. With respect to investments, custod ial credit risk generally applies
only to direct investments in marketable securities. Custodial credit risk does not apply to a local
government’s indirect investment in securities through the use of mutual funds or governmental investment
pools (such as LAIF).
DEPOSIT IN STATE INVESTMENT POOL
The District is a voluntary participant in the Local Agency Investment Fund (LAIF). This investment fund
has an equity interest in the State of California’s (State’s) Pooled Money Investment Account (PMIA). PMIA
funds are on deposit with the State’s Centralized Treasury System and are managed in compliance with
the California Government Code according to a statement of investment policy which sets forth permitted
investment vehicles, liquidity parameters, and maximum maturity of investments. The fair value of the
District’s investment in this pool is reported in the accompanying financial statements at amounts based
upon the District’s pro-rata share of the fair value provided by the LAIF for the entire LAIF portfo lio (in
relation to the amortized cost of the portfolio). The balance available for withdrawal is based on the
accounting records maintained by the LAIF, which are recorded on an amortized cost basis.
DEPOSIT IN PLACER COUNTY TREASURER INVESTMENT POOL
The District is a voluntary participant in the Placer County Investment Portfolio (PCTIP). The District is
eligible to participate in PCTIP because a portion of the District’s service area is in Placer County.
Investments are on deposit with the Placer County Treasurer and are managed in compliance with the
California Government Code according to a statement of investment policy which sets forth permitted
investment vehicles, liquidity parameters, and maximum maturity of investments. The fair value of t he
District’s investment in this pool is reported in the accompanying financial statements at amounts based
upon the District’s pro-rata share of the fair value provided by Placer County Treasurer for the entire PCTIP
(in relation to the amortized cost of the portfolio). The balance available for withdrawal is based on the
accounting records maintained by the Placer County Treasurer, which are recorded on an amortized cost
basis.
TRUCKEE DONNER PUBLIC UTILITY DISTRICT
NOTES TO FINANCIAL STATEMENTS
December 31, 2016 and 2015
.
The accompanying notes are an integral part of these consolidated financial statements.
Page 29
NOTE 2 – CASH, CASH EQUIVALENTS, AND INVESTMENTS (Continued)
DEPOSIT IN UTAH PUBLIC TREASURERS’ INVESTMENT FUND
The District is a voluntary participant in the Utah Public Treasurers’ Investment Fund (UPTIF). The District
is eligible to participate in UPTIF through its membership with Utah Associated Municipal Power Systems
(UAMPS). Investments are on deposit with State of Utah public treasury and investments are restricted to
those authorized by the Utah Money Management Act and rules of the Money Management Council of
Utah. The fair value of the District’s investments in this pool is reported in the accompanying financial
statements at amounts based upon the District’s pro-rata share of the fair value provided by UPTIF through
UAMPS Member Retention Fund.
NOTE 3 – CAPITAL ASSETS
Capital assets consist of the following at December 31, 2016 and 2015:
As of December 31, 2016 and 2015, the plant in service included land and land rights of $3,318,346 and
$2,622,946 respectively which are not being depreciated.
A portion of the plant has been contributed to the District. When replacement is needed, the District replaces
the contributed plant with District-financed plant.
January 1,December 31,
2016 Additions Reductions 2016
Electric distribution facilities 54,721,615$ 4,391,867$ (767,792)$ 58,345,690$
Water distribution facilities 107,005,578 2,023,496 (168,249) 108,860,825
General plant 13,887,881 1,332,733 (158,336) 15,062,278
175,615,074 7,748,096 (1,094,377) 182,268,793
Less: Accumulated depreciation (58,042,448) (6,485,285) 1,154,994 (63,372,739)
Construction work in progress 4,844,042 7,686,181 (7,823,947) 4,706,276
Totals 122,416,668$ 8,948,992$ (7,763,330)$ 123,602,331
January 1,December 31,
2015 Additions Reductions 2015
Electric distribution facilities 51,524,863$ 3,777,881$ (581,129)$ 54,721,615$
Water distribution facilities 103,049,122 5,653,380 (1,696,924) 107,005,578
General plant 12,816,635 1,314,555 (243,308) 13,887,881
167,390,620 10,745,816 (2,521,362) 175,615,074
Less: Accumulated depreciation (54,475,747) (6,204,361) 2,637,661 (58,042,448)
Construction work in progress 6,407,589 9,188,877 (10,752,425) 4,844,042
Totals 119,322,462$ 13,730,332$ (10,636,125)$ 122,416,668$
TRUCKEE DONNER PUBLIC UTILITY DISTRICT
NOTES TO FINANCIAL STATEMENTS
December 31, 2016 and 2015
.
The accompanying notes are an integral part of these consolidated financial statements.
Page 30
NOTE 4 – TELECOMMUNICATION SERVICES
In 1999, the District initiated a project to expand their basic service offerings to include internet access,
cable television and voice delivered over fiber optic networks (the broadband project). The District
completed the broadband design project and obtained the necessary regulatory approvals and franchises
needed to construct and launch the broadband project. A local cable television service provider filed an
objection in September 2004 with the Nevada County Local Agency Formation Commission (LAFCO), the
entity responsible for providing regulatory approval for the broadband project. After denying the cable
television provider’s request for a reconsideration of their approval of the District’s project, the cable
television provider filed a lawsuit against LAFCO. The District was not named in the lawsuit. A ruling on the
lawsuit was received in January 2006. LAFCO prevailed on all portions of the cable television provider’s
claim. The cable television provider filed an appeal; however, in June of 2007, the Court ruled in favor of
LAFCO, upholding the initial ruling.
Since 2009, the District has been exploring options to sell or lease the existing infrastructure to provide a
return on investment in the project. Expenses incurred by the District to date on the broadband project total
$2,834,079, of which $496,990 was expensed in 2014 for legal fees and preliminary feasibility studies. In
2016 and 2015 there were no material expenditures for this project. The District is however investigating a
Memorandum of Understanding with Plumas Sierra Telecommunications to potentially offer services
utilizing these four fibers from Reno to Sacramento in future years.
TRUCKEE DONNER PUBLIC UTILITY DISTRICT
NOTES TO FINANCIAL STATEMENTS
December 31, 2016 and 2015
.
The accompanying notes are an integral part of these consolidated financial statements.
Page 31
NOTE 5 – LONG-TERM DEBT
Long-term debt consisted of the following at December 31, 2016:
January 1,December 31,Due within
2016 Additions Reductions 2016 one year
Pension Obligation Bonds
Electric, 5%
due semi-annually 5,584,000$ -$ (5,584,000)$ -$ -$
refinanced in 2016
Pension Obligation Bonds
Electric, 2.47%
due semi-annually - 5,589,000 (440,000) 5,149,000 809,000
State Revolving Fund Loan –
Water, 2.34%, due semi-annually
beginning in 2006 to 2026 7,417,358 - (630,956) 6,786,402 645,807
Certificates of Participation –
Water, 4.00% to 5.00%,
due serially to 2021
refinanced in 2016 3,765,000 - (3,765,000) - -
Certificates of Participation –
Water, 1.54%
due serially to 2021 - 3,266,000 - 3,266,000 632,000
Certificates of Participation –
Water, 2.00% to 4.00%,
due serially to 2035 (net
premiums of $502,077)14,544,095 - (547,018) 13,997,077 535,000
Department of Water Resources,
3.18%, due semiannually to
2021, secured by real
and personal property.1,535,448 - (259,705) 1,275,743 268,092
Installment loans, 5.4% to 6.23%,
various payment terms and
due dates, secured by
equipment.673,789 - (299,242) 374,548 316,144
Totals 33,519,690$ 8,855,000$ (11,525,921)$ 30,848,770$ 3,206,043$
TRUCKEE DONNER PUBLIC UTILITY DISTRICT
NOTES TO FINANCIAL STATEMENTS
December 31, 2016 and 2015
.
The accompanying notes are an integral part of these consolidated financial statements.
Page 32
NOTE 5 – LONG-TERM DEBT (Continued)
Long-term debt consisted of the following at December 31, 2015:
During April 2004, the District obtained financing in the form of a State Revolving Fund Loan, the proceeds
of which were utilized in the replacement of the Donner Lake water system. The District submitted
expenditures to the State for reimbursement of $12,732,965. The semi-annual principal and interest
payments are $400,426 and commenced in 2006. The District is also required to fund a reserve account
by making semi-annual reserve payments in the amount of $40,043 for a 10-year period. In 2004, the
remaining balance of $12,227,122 was used to pay off the temporary lines of credit obtained in 2001 and
2002 to fund the Donner Lake project. (See note 8).
On October 12, 2006, Truckee Donner Public Utility District Financing C orporation issued $26,570,000 of
Certificates of Participation to refund 100% of the outstanding balance of Certificates issued in 1996,
complete the funding of the Donner Lake Assessment District water system, and fund water system capital
improvements. The refunding portion of the 2006 COP’s, totaling $8,465,000, has an average interest rate
of 4.10%. The refunded 1996 COP’s had an average interest rate of 5.41%. The net proceeds of
$7,500,557 (after payment of $63,733 in underwriting fees, insurance and other issuance costs) plus an
additional $1,315,194 of reserve fund monies were used to prepay the outstanding debt service
requirements on the 1996 COP’s. The terms of the Certificates call for payments to be made only from the
net revenues of the Water Division and the debt is secured by this revenue. These revenues are required
to be at least equal to 125% of the debt service for each year.
In 2015, a portion of the 2006 COP was refunded. Since a portion of the 2006 COP was used for advance
refunding of previous COP, that portion could not be advance refunded. The new 2015 refunding did not
TRUCKEE DONNER PUBLIC UTILITY DISTRICT
NOTES TO FINANCIAL STATEMENTS
December 31, 2016 and 2015
.
The accompanying notes are an integral part of these consolidated financial statements.
Page 33
NOTE 5 – LONG-TERM DEBT (Continued)
require a reserve fund. The reserve fund was liquidated and applied towards reducing the debt principal.
The estimated net present value savings are $1,600,000 or 10% over the remaining life of issuance.
In 2016, the remaining portion of the 2006 COP was refunded. The estimated net present value savings is
$222,000 or 5.8% over the remaining life of issuance.
Under the Safe Drinking Water Bond Law of 1986, the Department of Water Resources provided a
$5,000,000 loan to the District in 1993. The loan was to finance capital improvements to the public water
supply and to reduce water quality hazards. The terms of the loan call for payments to be made only from
the net revenues of the Water Division, which are required to be sufficient to pay the debt service for each
year.
In June 2011, the District refunded (refinanced) an existing $7.8 million pension side fund obligat ion for its
participation in CalPERS. Prior to 2011, the annual side fund payments were expensed and described in
the Notes to Financial Statements. The pension side fund liability was amortized through June 2022 with a
7.75% rate. This liability was not required to be reported on the District’s Statement of Net Position, but the
future pension expense was included in budget and rate calculations. The new refunding rate of 5% reduced
the District’s annual pension costs by almost $100,000 through 2022. In 2016, the District refunded the
pension side fund again earning the District annual savings of $30,000 or $164 ,000 in total.
As a normal part of its operations, the District finances the acquisition of certain assets through the use of
installment loans. These loans have been used to finance the purchase of vehicles, equipment , and certain
water system improvements. There were no additional installment loans in 2016 or in 2015.
Scheduled payments on debt are:
Principal Interest Total
2017 3,206,043$ 884,765$ 4,090,808$
2018 3,006,314 797,286 3,803,600
2019 3,117,221 724,222 3,841,443
2020 3,228,784 648,447 3,877,231
2021 3,179,833 571,195 3,751,028
2022-2026 7,363,498 1,959,576 9,323,074
2027-2031 4,110,000 1,050,625 5,160,625
2032-2036 3,135,000 270,175 3,405,175
30,346,693$ 6,906,291$ 37,252,984$
Plus: Unamortized premiums 502,077
30,848,770$
TRUCKEE DONNER PUBLIC UTILITY DISTRICT
NOTES TO FINANCIAL STATEMENTS
December 31, 2016 and 2015
.
The accompanying notes are an integral part of these consolidated financial statements.
Page 34
NOTE 6 – UNEARNED REVENUES
Transactions that have not yet met revenue recognition requirements are recorded as a non-current liability
and reflected in the accompanying Statement of Net Position. As of December 31, 2016 and 2015,
unearned revenues consist of unearned development agreement deposits , connection fees, and other
deposits.
Unearned revenues consisted of the following at December 31, 2016 and 2015:
NOTE 7 – DONNER LAKE WATER COMPANY ACQUISITION
In 2001, the District acquired the Donner Lake Water Company by initiating an eminent domain lawsuit. As
a part of the takeover, the District replaced the entire water system, which cost approximately
$15.6 million and was completed in 2006. The District initially estimated the replacement cost to be
$13 million. The Donner Lake property owners agreed to reimburse the District for the full costs of the
replacement. Therefore, an assessment was placed on each Donner Lake homeowner’s property for a pro-
rata share of the $13 million payable immediately or with an option to pay over 20 years. The assessment
is collected by Nevada County and Placer County on behalf of the District and is secured by the Donner
Lake property owners. A monthly $6.65 water system upgrade surcharge is paid by the Donner Lake
customers to reimburse the District for the $2.6 million cost incurred in excess of the assessment.
In April 2004, the District obtained financing in the form of a State Revolving Fund Loan for $12,732,965 at
a rate of 2.34%. The District is required to fund a reserve account by making semi-annual reserve payments
in the amount of $40,043 for a 10-year period. The reserve is fully funded as of December 31, 2016.
As of December 31, 2016 and 2015, the assessment receivable from the property owners was $3,692,876
and $4,363,790 respectively, of which $714,622 and $694,710 is due in the next year. These amounts are
shown as Special Assessments Receivable in the Statement of Net Position. The proceeds of the
assessment and surcharge are placed in the Donner Lake Special Assessment District Improvement Fund
and used to pay the debt service for the water system improvements.
January 1,December 31,
2016 Additions Reductions 2016
Development agreement deposits 2,156,844 644,922 (564,436) 2,237,331
Connection fees and other deposits 1,069,865 987,610 (1,221,299) 836,177
Totals 3,226,709$ 1,632,532$ (1,785,734)$ 3,073,507$
January 1,December 31,
2015 Additions Reductions 2015
Development agreement deposits 1,843,013 738,336 (424,505) 2,156,844
Connection fees and other deposits 943,750 1,085,304 (959,189) 1,069,865
Totals 2,786,763$ 1,823,640$ (1,383,694)$ 3,226,709$
TRUCKEE DONNER PUBLIC UTILITY DISTRICT
NOTES TO FINANCIAL STATEMENTS
December 31, 2016 and 2015
.
The accompanying notes are an integral part of these consolidated financial statements.
Page 35
NOTE 8 – EMPLOYEE BENEFIT PLANS
A. PENSION PLANS
Plan Description – All qualified permanent and probationary employees are eligible to participate in
the District’s Miscellaneous Employee Pension Plans, cost-sharing multiple employer defined benefit
pension plans administered by the California Public Employees’ Retirement System (CalPERS).
Benefit provisions under the Plans are established by State statute and Local Government re solution.
CalPERS issues publicly available reports that include a full description of the pension plans regarding
benefit provisions, assumptions and membership information that can be found on the CalPERS
website.
Benefits Provided – CalPERS provides service retirement and disability benefits, annual costs of living
adjustments and death benefits to plan members, who must be public employees and beneficiaries.
Benefits are based on years of credited service, equal to one year of full time employment. Members
with five years of total service are eligible to retire at age 50 with statutorily reduced benefits. All
members are eligible for non-duty disability benefits after 10 years of service. The death benefits is
Optional Settlement 2W Death Benefit. The cost of living adjustments for each plan are applied as
specified by the Public Employees’ Retirement Law. The 2.7% at 55 Miscellaneous Plan is closed to
new entrants.
The plans’ provisions and benefits in effect at June 30, 2016, are summarized as follows:
Contributions – Section 208149(c) of the California Public Employee’s Retirement Law requires that
the employer contribution rates for all public employers be determined on an annual basis by the
actuary and shall be effective on the Jul y 1 following notice of a change in the rate. Funding
contributions for both Plans are determined annually on an actuarial basis as of June 30 by CalPERS.
The actuarially determined rate is the estimated amount necessary to finance the costs of benefits
earned by employees during the year, with an additional amount to finance any unfunded accrued
liability. The District is required to contribute the difference between the actuarially determined rate
and the contribution rate of employees.
Hire Date
Prior to
January 1, 2013
On or after
January 1, 2013
Benefit Formula 2.7% @ 55 2% @ 62
Benefit Vesting Schedule 5 years service 5 years service
Benefit Payments monthly for life monthly for life
Retirement Age 50 and Up 52 and Up
Monthly Benefits, as a % of eligible compensation 2.0% - 2.7%1.0% to 2.5%
Required Employee Contributions Rates 8%6.25%
Required Employer Contributions Rates 11.008%6.555%
Miscellaneous
Hire Date
Prior to
January 1, 2013
On or after
January 1, 2013
Benefit Formula 2.7% @ 55 2% @ 62
2016 Employer Contributions $979,835 $69,062
2015 Employer Contributions $917,113 $33,034
Miscellaneous
TRUCKEE DONNER PUBLIC UTILITY DISTRICT
NOTES TO FINANCIAL STATEMENTS
December 31, 2016 and 2015
.
The accompanying notes are an integral part of these consolidated financial statements.
Page 36
NOTE 8 – EMPLOYEE BENEFIT PLANS (Continued)
B. PENSION LIABILITIES, PENSION EXPENSES AND DEFERRED OUTFLOWS/INFLOWS OF
RESOURCES RELATED TO PENSIONS
As of December 31, 2016, the District reported net pension liabilities for its proportionate shares of the net
pension liability as follows:
The District’s net pension liability is measured as a proportionate share of the net pension liability. The
net pension liability is measured as of June 30, 2016, and the total pension liability used to calculate
the net pension liability was determined by an actuarial valuation as of June 30, 2015 rolled forward to
June 30, 2016 using standard update procedures. The District’s proportion of the net pension liability
was based on a projection of the District’s long-term share of contributions to the pension plans relative
to the projected contributions of all participating employers, actuarially determined. The District’s
proportionate share of the net pension liability for the Plan for the measurement date of June 30, 2016
and June 30, 2015 is as follows:
For the years ended December 31, 2016 and 2015 the District recognized pension expense of $1,220,591
and $535,372 respectively. At December 31, 2016 the District reported deferred outflows of resources and
deferred inflows of resources related to pensions from the following sources:
June 30, 2016 June 30, 2015
$10,250,329 $8,013,400
Proportionate Share of Net Pension Liability
Fiscal Year Ending
June 30, 2016 June 30, 2015 Change
0.29837%0.29209%0.00628%
Percentage Share of Risk Pool
Percentage of Plan NPL
Measurement Date
Deferred Outflows of
Resources
Deferred Inflows of
Resources
Pension contributions subsequent to measurement date $773,689
Differences between actual and expected experience 39,148 (8,286)
Changes in assumptions (370,377)
Change in employer's proportion and differences between
the employer's contributions and the employer's
proportionate share of contributions
Net differences between projected and actual earnings 2,952,379 (1,177,063)
on plan investments
Total $4,005,050 ($1,597,126)
239,834 (41,400)
TRUCKEE DONNER PUBLIC UTILITY DISTRICT
NOTES TO FINANCIAL STATEMENTS
December 31, 2016 and 2015
.
The accompanying notes are an integral part of these consolidated financial statements.
Page 37
NOTE 8 – EMPLOYEE BENEFIT PLANS (Continued)
B. PENSION LIABILITIES, PENSION EXPENSES AND DEFERRED OUTFLOWS/INFLOWS OF
RESOURCES RELATED TO PENSIONS (Continued)
$773,689 reported as deferred outflows of resources related to contributions subsequent to the
measurement date will be recognized as a reduction of the net pension liability in the year ended December
31, 2016. Other amounts reported as deferred outflows of resources and deferred inf lows of resources
related to pensions will be recognized as pension expense as follows:
Actuarial Assumptions – The total pension liabilities in the June 30, 2016 actuarial valuations were
determined using the following actuarial assumptions:
(1) The mortality table used was developed based on CalPERS’ specific data. The Table includes 20 years of
mortality improvements using Society of Actuaries Scale BB. For more details on this table, please refer to
the 2014 experience study report.
All underlying mortality assumptions and all other actuarial assumptions used in the June 30, 201 6 valuation
were based on results of a January 2014 actuarial experience study for the period 1997 to 2011. Further
details of the Experience Study can be found on the CalPERS website.
Year Ended
December 31 Amount
2017 $158,022
2018 $191,462
2019 $823,549
2020 $461,202
$1,634,235
Miscellaneous
2016
Valuation Date June 30, 2015
Measurement Date June 30, 2016
Actuarial Cost Method Entry-Age Normal Cost Method
Actuarial Assumptions: .
Discount Rate 7.65%
Inflation 2.75%
Payroll Growth 3.00%
Salary Increase Varies by Entry Age and Service
Investment Rate of Return 7.5% Net of Pension Plan Investment and Administrative
Expenses; includes Inflation
Mortality (1)Derived using CalPERS membership data for all funds
TRUCKEE DONNER PUBLIC UTILITY DISTRICT
NOTES TO FINANCIAL STATEMENTS
December 31, 2016 and 2015
.
The accompanying notes are an integral part of these consolidated financial statements.
Page 38
NOTE 8 – EMPLOYEE BENEFIT PLANS (Continued)
B. PENSION LIABILITIES, PENSION EXPENSES AND DEFERRED OUTFLOWS/INFLOWS OF
RESOURCES RELATED TO PENSIONS (Continued)
Discount Rate - The discount rate used to measure the total pension liability as of December 31, 2016
was 7.65%. To determine whether the municipal bond rate should be used in the calculation of a discount
rate for each plan, CalPERS stress tested plans that would most likely result in a discount rate that would
be different from the actuarially assumed discount rate. Based on the testing, none of the tested plans run
out of assets. Therefore, the current 7.65% discount rate used is adequate and the use of the municipal
bond rate calculation is not necessary. The long term expected discount rate of 7.65% will be applied to
all plans in the Public Employees Retirement Fund (PERF). The stress test results are presented in a
detailed report that can be obtained from the CalPERS website.
The long-term expected rate of return on pension plan investments was determined using a building-block
method in which best-estimate ranges of expected future real rate of return (expected returns, net of
pension plan investment expense and inflation) are developed for each major asset class.
In determining the long-term expected rate of return, CalPERS took into account both short-term and long-
term market return expectations as well as the expected pension fund cash flows. Using historical returns
of all the funds’ asset classes, expected compound returns were calculated over the short-term (first 10
years) and the long term (11-60 years) using a building-block approach. Using the expected nominal
returns for both short-term and long-term, the present value of benefits was calculated for each fund. The
expected rate of return was set by calculating the single equivalent expected return that arrived at the same
present value of benefits for cash flows as the one calculated using both short-term and long-term returns.
The expected rate of return was then set equivalent to the single equivalent rate calculated above and
rounded down to the nearest one quarter of one percent.
The table below reflects the long-term expected real rate of return by asset class. The rate of return was
calculated using the capital market assumptions applied to determine the discount rate and asset allocation.
The target allocation shown below was adopted by CalPERS’ Board effective on
July 1, 2015.
Asset Class
New Strategic
Allocation
Real Return
Years 1-10 (a)
Real Returns
Years 11+(b)
Global Equity 51.0%5.25%5.71%
Global Fixed Income 20.0%0.99%2.43%
Inflation Sensitive 6.0%0.45%3.36%
Private Equity 10.0%6.83%6.95%
Real Estate 10.0%4.50%5.13%
Infrastructure and Forestland 2.0%4.50%5.09%
Liquidity 1.0%-0.55%-1.05%
100.0%
TRUCKEE DONNER PUBLIC UTILITY DISTRICT
NOTES TO FINANCIAL STATEMENTS
December 31, 2016 and 2015
.
The accompanying notes are an integral part of these consolidated financial statements.
Page 39
NOTE 8 – EMPLOYEE BENEFIT PLANS (Continued)
B. PENSION LIABILITIES, PENSION EXPENSES AND DEFERRED OUTFLOWS/INFLOWS OF
RESOURCES RELATED TO PENSIONS (Continued)
Sensitivity of the Proportionate Share of the Net Pension Liability to Changes in the Discount
Rate - The following presents the District’s proportionate share of the net pension liability for each Plan,
calculated using the discount rate for each Plan, as well as what the District’s proportionate share of
the net pension liability would be if it were calculated using a discount rate that is 1% point lower or 1%
point higher than the current rate:
Pension Plan Fiduciary Net Position – Detailed information about each pension plan’s fiduciary net
position is available in the separately issued CalPERS financial reports.
C. PAYABLE TO THE PENSION PLAN
At December 31, 2016 and 2015 respectively the District did not report a payable for outstanding
required contributions to the pension plan.
D. DEFERRED COMPENSATION PLAN
The District maintains two deferred compensation plans: a 401(a) and a 457 plan, (the Pla ns) for certain
qualified employees. The District matches 6.78% of eligible employee contributions. In 2016 and 2015,
the total match was $88,494 and $53,605 in the respective years. The District has no liability for losses
under the Plans, but does have the duty of due care that would be required of an ordinary prudent
investor. The District has not reflected the Plans’ assets and corresponding liabilities (if any) on the
accompanying Statement of Net Position.
Measurement Date June 30,2016
1% Decrease 6.65%
Net Pension Liability $15,969,742
Current Discount Rate 7.65%
Net Pension Liability $10,250,329
1% Increase 8.65%
Net Pension Liability $5,523,516
Miscellaneous
TRUCKEE DONNER PUBLIC UTILITY DISTRICT
NOTES TO FINANCIAL STATEMENTS
December 31, 2016 and 2015
.
The accompanying notes are an integral part of these consolidated financial statements.
Page 40
NOTE 8 – EMPLOYEE BENEFIT PLANS (Continued)
E. OTHER POST EMPLOYMENT BENEFITS (OPEB)
The District administers a single-employer defined benefit healthcare plan (The Retiree Health Plan).
Contribution requirements and benefit provisions are established through collective bargaining agree ments
and may be amended only through negotiations between the District and the Union. The plan provides
health insurance contributions for eligible retirees and their spouses through the District’s group health
insurance plan, which covers both active and retired members. Health insurance includes medical
insurance, dental insurance, and prescriptions. The Retiree Health Plan does not issue a publicly available
financial report.
Post employment health care is available to all employees, and qualified dependents, that retire from the
District with at least 10 years of service. As of June 30, 2015, there were fifty participants including
dependents. The monthly amount paid by the District is capped at $475 for each participant or $375 for
each participant eligible for Medicare. For participants with less than 20 years of service, the benefit is
reduced by 5% for each year. Expenditures for post employment health care benefits are recognized when
premiums are paid.
On November 7, 2007, the Board approved a participation agreement with CalPERS to be the plan
administrator for the District's other post employment benefit (OPEB) trust. The participation agreement
was submitted to CalPERS on November 8, 2007, and became effective on January 15, 2008. At that time,
accumulated deposits from the prior year, plus accrued interest, were transferred to the California
Employers’ Retiree Benefit Trust Program (CERBT).
The funds of the Retiree Health Plan are invested in CERBT, which is a tax qualified trust organized un der
Internal Revenue Code (IRC) Section 115. Participation in the trust is limited to those agencies who qualify
as “government” entities under that IRC section. The CERBT is an irrevocable trust established for the
purpose of receiving employer contributions to prefund health and other postemployment benefits for
retirees and their beneficiaries. The CERBT administrative costs are financed through investment earnings.
Copies of the CalPERS’ comprehensive annual financial report, that includes CERBT investm ent
performance, may be obtained from:
California Public Employees’ Retirement System
400 Q Street
P.O. Box 942701
Sacramento, CA 94229-2701
Tel. 888-225-7377
http://www.calpers.ca.gov
The District's annual OPEB expense is calculated based on the ARC, an amount actuarially determined in
accordance within the parameters of GASB Statement No. 45. The ARC represents a level of funding that,
if paid on an ongoing basis, is projected to cover the normal cost each year. The plan’s unfunded actuarial
accrued liability prior to June 30, 2015 is being amortized as a level percentage of projected payrolls on an
open basis, over a period not to exceed 30 years, using the entry age normal cost method. The June 30,
2015 unfunded actuarial accrued liability is being am ortized as a level percentage of projected payroll on
an open basis, over a 20 year period, using the actuarial cost method.
The District’s actual annual OPEB contribution is recognized as in the District’s operating expenses. The
following table shows the components of the amount actually contributed to the plan, and changes in the
net OPEB obligation to the Retiree Health Plan:
TRUCKEE DONNER PUBLIC UTILITY DISTRICT
NOTES TO FINANCIAL STATEMENTS
December 31, 2016 and 2015
.
The accompanying notes are an integral part of these consolidated financial statements.
Page 41
NOTE 8 – EMPLOYEE BENEFIT PLANS (Continued)
E. OTHER POST EMPLOYMENT BENEFITS (OPEB) (Continued)
Actuarial valuations of an ongoing plan are required at least once every two years and involve estimates
for the value of reported amounts and assumptions about the probability of occurrence of events far into
the future. Examples include assumptions about future employment, mortality, and the healthcare cost
trend. Amounts determined regarding the funded status of the plan and annual required contributions of the
employer are subject to continual revision as actual results are compared with past expectations and new
estimates are made about the future.
Projections of benefits for financial reporting purposes are based on the substantive plan (the plan as
understood by the employer and plan members) and include the types of benefits provided at the time of
each valuation and historical pattern of sharing benefit costs between the employer and plan members to
that point. The methods and assumptions used include techniques that are designed to reduce short -term
volatility in actuarial accrued liabilities and the actuarial value of assets, consistent with the long-term
perspective of calculations.
Significant actuarial assumptions for years prior to June 30, 2015 include:
Actuarial Cost Method Projected Unit Credit
Asset Valuation Method Five-year spread of gain/loss, beginning with 2009-10
Gain/loss on market value basis compared to assumption
Discount Rate 7.5%
General Inflation 3% Annual Increase
Amortization of Unfunded Liability 23 years; level annual payments
Significant actuarial assumptions after June 30, 2015 include:
Actuarial Cost Method Entry Age Normal
Asset Valuation Method Five-year smoothing formula with a 20% corridor around
market value
Discount Rate 7.0%
General Inflation 2.75% Annual Increase
Amortization of Unfunded Liability Closed 30 years; level percent for initial UAAL
Open 20 years; level percent for residual UAAL
Annual % of Change in OPEB Net OPEB
Fiscal Required Interest Annual Annual Net OPEB Obligation Obligation
Year Contribution and OPEB Actual OPEB Cost Obligation (Asset)(Asset)
Ended*(ARC)Adjustments Cost Contribution Contributed (Asset)Beginning Ending
06/30/2013 267,800$ 628$ 268,428$ 304,556$ 113.5%(36,128)$ (8,205)$ (44,333)$
06/30/2014 267,800$ -$ 267,800$ 268,498$ 100.3%(698)$ (44,333)$ (45,031)$
06/30/2015 647,851$ -$ 647,851$ 274,029$ 42.3%373,822$ (45,031)$ 328,791$
06/30/2016 665,667$ -$ 665,667$ 275,240$ 41.3%390,427$ 328,791$ 719,217$
TRUCKEE DONNER PUBLIC UTILITY DISTRICT
NOTES TO FINANCIAL STATEMENTS
December 31, 2016 and 2015
.
The accompanying notes are an integral part of these consolidated financial statements.
Page 42
NOTE 8 – EMPLOYEE BENEFIT PLANS (Continued)
E. OTHER POST EMPLOYMENT BENEFITS (OPEB) (Continued)
The following is a funding schedule for the Retiree Health Plan:
The actuarial valuation issued July 1, 2015 had a significant increase in accrued liability of $3.8 million due
to a new Actuarial Standard of Practice 6 that became effective for valuations after March 1, 2015 that
requires valuing an “implicit rate subsidy”. Though the District has an employer cap on retiree benefits , the
liability of providing them based on the expected premiums of the plan are now required to be recognized
in the actuarial valuation to guarantee the stability of the plan for the long run which nearly doubled the
normal costs and liabilities.
NOTE 9 – SELF FUNDED INSURANCE
The District has a self-funded vision insurance program and claims were processed by and on behalf of the
District. The District did not maintain a claim liability; rather claims were expensed as paid. The amount of
claims paid for each of the past three years have not been material.
NOTE 10 – SEGMENT DISCLOSURE
The District has issued revenue bonds to finance electric and water distribution facilities. The District also
issued special tax bonds secured by tax revenues from Mello-Roos Community Facilities Districts. Each
project has an external requirement to be reported separately, and investors in the revenue bonds and
special tax bonds rely solely on the revenue generated by the individual projects for repayment. Summary
financial information for each project is presented on the following pages for the years ending December
31, 2016 and 2015.
Accrued Actuarial Unfunded Funded Annual
Valuation Liabilities Value of Liabilities Ratio Covered UL as a %
Date*(AL)Assets (AVA)(UL)(AVA/AL)Payroll of Payroll
01/01/2011 2,501,800$ 645,700$ 1,856,100$ 25.8%6,307,400$ 29.4%
07/01/2011 2,657,000$ 661,400$ 1,995,600$ 24.9%6,226,000$ 32.1%
07/01/2013 2,960,600$ 1,079,900$ 1,880,700$ 36.5%6,409,000$ 29.3%
07/01/2015 6,755,593$ 1,579,982$ 5,175,611$ 23.4%6,360,511$ 81.4%
*Valuations are required once every two years. In 2011, the vaulation
date changed to July 1 in compliance with GASB Statement No. 57.
Schedule of Retiree Health Plan Funding Progress
TRUCKEE DONNER PUBLIC UTILITY DISTRICT
NOTES TO FINANCIAL STATEMENTS
December 31, 2016 and 2015
.
The accompanying notes are an integral part of these consolidated financial statements.
Page 43
NOTE 10 – SEGMENT DISCLOSURE (Continued)
STATEMENT OF NET POSITION
Electric Water
Current assets 19,438,054$ 9,475,927$
Non-current assets:
Capital assets, net 47,660,186 75,942,145
Restricted assets - 1,876,032
Other long term assets 925,520 3,692,876
Total Noncurrent Assets 48,585,706 81,511,053
Deferred outflows of resources
Pension 2,403,030 1,602,020
Unamortized loss on refunding - 609,580
Unamortized redemption premium 149,934 -
Total Deferred Outflows of Resources 2,552,964 2,211,600
TOTAL ASSETS AND DEFERRED OUTFLOWS 70,576,724$ 93,198,580$
OF RESOURCES
AND NET POSITION
Current liabilities 4,312,570$ 2,949,891$
Non-current Liabilities
Long-term debt, net of current portion 4,398,403 23,244,323
Net pension liability 6,150,197 4,100,132
OPEB liability 431,530 287,687
Unearned revenues 2,587,458 486,049
Total Noncurrent Liabilities 13,567,588 28,118,191
Total Liabilities 17,880,158 31,068,082
Deferred inflows of resources
Pension 958,276 638,850
Total Deferred Inflows of Resources 958,276 638,850
Net Position
Net investment in capital assets 42,500,995 50,920,550
Restricted for debt service 1,316,355 4,695,114
Unrestricted 7,920,940 5,875,984
Total Net Position 51,738,290 61,491,648
TOTAL LIABILITIES, DEFERRED INFLOWS 70,576,724$ 93,198,580$
OF RESOURCES AND NET POSITION
LIABILITIES
ASSETS AND DEFERRED OUTFLOWS OF RESOURCES
LIABILITIES, DEFERRED INFLOWS OF RESOURCES
December 31, 2016
TRUCKEE DONNER PUBLIC UTILITY DISTRICT
NOTES TO FINANCIAL STATEMENTS
December 31, 2016 and 2015
.
The accompanying notes are an integral part of these consolidated financial statements.
Page 44
NOTE 10 – SEGMENT DISCLOSURE (Continued)
STATEMENT OF NET POSITION (CONTINUED)
Electric Water
Current assets 16,871,099$ 11,359,701$
Non-current assets:
Capital assets, net 47,078,580 75,338,088
Restricted assets - 1,900,036
Other long-term assets 997,853 4,363,790
Total Noncurrent Assets 48,076,433 81,601,914
Deferred outflows of resources
Pension 1,579,246 1,052,831
Unamortized loss on refunding - 642,382
Total Deferred Outflows of Resources 1,579,246 1,695,213
TOTAL ASSETS AND DEFERRED OUTFLOWS
OF RESOURCES 66,526,778$ 94,656,828$
Current liabilities 4,388,630$ 2,912,146$
Non-current Liabilities
Long-term debt, net of current portion 4,996,594 25,587,176
Net pension liability 4,808,040 3,205,360
Unearned revenues 2,585,854 640,855
Total Noncurrent Liabilities 12,390,488 29,433,391
Total Liabilities 16,779,118 32,345,537
Deferred inflows of resources
Pension 1,405,042 936,695
Total Deferred Inflows of Resources 1,405,042 936,695
Net Position
Net investment in capital assets 40,828,835 47,786,674
Restricted for debt service 944,929 4,817,195
Unrestricted 6,568,854 8,770,727
Total Net Position 48,342,618 61,374,596
TOTAL LIABILITIES, DEFERRED INFLOWS
OF RESOURCES AND NET POSITION 66,526,778$ 94,656,828$
RESOURCES AND NET POSITION
OUTFLOWS OF RESOURCES
LIABILITIES
ASSETS AND DEFERRED
LIABILITIES, DEFERRED INFLOWS OF
December 31, 2015
TRUCKEE DONNER PUBLIC UTILITY DISTRICT
NOTES TO FINANCIAL STATEMENTS
December 31, 2016 and 2015
.
The accompanying notes are an integral part of these consolidated financial statements.
Page 45
NOTE 10 – SEGMENT DISCLOSURE (Continued)
STATEMENTS OF REVENUE, EXPENSES, AND CHANGES IN NET POSITION
Year ended December 31, 2016
Electric Water
Operating Revenues
Sales to consumers 21,713,614$ 11,312,973$
Other operating revenues 3,357,601 749,177
Operating expenses (20,222,867) (8,171,428)
Depreciation (2,576,192) (3,660,841)
Non-operating revenues (expenses)12,076 (700,499)
Income (loss) before
capital contributions 2,284,232 (470,618)
Capital contributions, net 1,111,440 587,670
CHANGE IN NET POSITION 3,395,672 117,052
Net Position, Beginning 48,342,618 61,374,596
NET POSITION, ENDING 51,738,290$ 61,491,648$
Electric Water
Operating Revenues
Sales to consumers 20,505,263$ 10,313,593$
Other operating revenues 3,156,585 475,484
Operating expenses 18,944,380 7,461,394
Depreciation 2,375,757 3,584,763
Non-operating revenues (expenses)106,127 (868,838)
Income (loss) before
capital contributions 2,447,838 (1,125,918)
Capital contributions, net 1,058,835 371,675
CHANGE IN NET POSITION 3,506,673 (754,243)
Net Position, Beginning 44,835,945 62,128,839
NET POSITION, ENDING 48,342,618$ 61,374,596$
Year ended December 31, 2015
TRUCKEE DONNER PUBLIC UTILITY DISTRICT
NOTES TO FINANCIAL STATEMENTS
December 31, 2016 and 2015
.
The accompanying notes are an integral part of these consolidated financial statements.
Page 46
NOTE 10 – SEGMENT DISCLOSURE (Continued)
STATEMENTS OF CASH FLOWS
Year ended December 31, 2016
Electric Water
NET CASH PROVIDED BY (USED IN)
Operating activities 5,549,180$ 3,719,688$
Noncapital financing activities (921,171) -
Capital and related financing activities (2,233,583) (6,189,302)
Investing activities 114,807 292,186
2,509,233 (2,177,428)
Cash and Cash Equivalents, Beginning 12,930,593 9,663,002
CASH AND CASH
EQUIVALENTS, ENDING 15,439,826$ 7,485,574$
Year ended December 31, 2015
Electric Water
NET CASH PROVIDED BY (USED IN)
Operating activities 5,230,727$ 3,052,344$
Noncapital financing activities (894,725) -
Capital and related financing activities (4,820,206) (6,781,907)
Investing activities 89,048 324,675
(395,156) (3,404,888)
Cash and Cash Equivalents, Beginning 13,325,749 13,067,890
CASH AND CASH
EQUIVALENTS, ENDING 12,930,593$ 9,663,002$
Net increase (decrease) in cash and
cash equivalents
cash equivalents
Net increase (decrease) in cash and
TRUCKEE DONNER PUBLIC UTILITY DISTRICT
NOTES TO FINANCIAL STATEMENTS
December 31, 2016 and 2015
.
The accompanying notes are an integral part of these consolidated financial statements.
Page 47
NOTE 11 – MARTIS VALLEY GROUNDWATER STUDY
The Martis Valley aquifer underlies about 35,000 acres in both Placer and Nevada counties, near the
Town of Truckee. It is the main water supply for numerous public and private entities. This area has
seen significant growth in the last few decades with more planned for the future. Maintaining an
adequate water supply and protecting water quality are critical for the region's future.
The Truckee Donner Public Utility District (TDPUD), Northstar Community Services District (NCSD)
and Placer County Water Agency (PCWA) are the three primary public water agencies in the Martis
Valley Basin. Together, the TDPUD, NCSD and PCWA (Partnership Agencies) partnered to update a
groundwater management plan and to help develop a groundwater model for the Martis Valley basin.
The Martis Valley Groundwater Management Plan (GMP) has been updated to reflect current water
resources planning in the region and to incorporate the lates t information and understanding of the
underlying groundwater basin. This collaborative effort will provide the guidance necessary to align
groundwater policy. In addition to the updated groundwater management plan, a computer model of
the groundwater basin is being developed, which will incorporate available data and enhance
understanding of the groundwater basin. A climate change modeling component will be part of the final
groundwater model.
Partner agencies each adopted the Groundwater Management Pla n (GMP) in February 2012 and the
model and associated report was completed in 2015. The total cost of the project was approximately
$1,000,000, which includes federal funding of approximately $500,000 from the U.S. Bureau of
Reclamation and $250,000 from the Lawrence Livermore National Laboratory; and contributions of
$150,000 from TDPUD and $100,000 from the other members of the Partnership Agencies.
In mid 2016, the California Sustainable Groundwater Management Act of 2014 (SGMA) took effect
which the District was the submitting agency of an alternate submittal in December on behalf of the
Town, Placer County, Nevada County, PCWA, and Northstar CSD - to comply with the new regulations.
There was an adopted MOA amongst the six local agencies.
NOTE 12 – CLAIMS AND JUDGMENTS
From time to time, the utility is party to various pending claims and legal proceedings. Although the
outcome of such matters cannot be forecasted with certainty, it is the opinion of management and the
utility's legal counsel that the likelihood is remote that any such claims or proceedings will have a
material adverse effect on the utility's financial position or results of operations.
NOTE 13 – RISK MANAGEMENT
The utility is exposed to various risks of loss related to torts; theft of, damage to, or destruction of assets;
errors and omissions; workers compensation; and health care of its employees. These risks are
covered through the purchase of commercial insurance, with minimal deductibles. Settled claims have
not exceeded the commercial liability in any of the past three years. There were no significant
reductions in coverage compared to the prior year.
REQUIRED SUPPLEMENTARY INFORMATION
TRUCKEE DONNER PUBLIC UTILITY DISTRICT
REQUIRED SUPPLEMENTARY INFORMATION
December 31, 2016
Page 49
COST SHARING DEFINED BENEFIT PENSION PLANS
2016 2015 2014
Portion of Net Pension Liability 0.29837%0.29209%0.09982%
Proportionate Share of The Net Pension Liability $10,250,329 $8,013,400 $6,210,985
Covered - Employee Payroll $6,670,248 $6,162,431 $6,278,545
Proporationate Share of the Net Pension Liability as
Percentage of Covered Payroll 153.67%130.04%98.92%
Plan's Fidicuiary Net Position $30,950,578 $30,725,516 $30,386,101
Plan Fiduciary Net Position as a percentage of the
Total Pension Liability 75.12%79.31%75.44%
* Fiscal year 2014 was the 1st year of implementation, therefore only three years are shown
Schedule of the District's Proportionate Share of the Net Pension Liability
Cost Sharing Defined Benefit Plans
As of June 30
Last Ten Years*
TRUCKEE DONNER PUBLIC UTILITY DISTRICT
REQUIRED SUPPLEMENTARY INFORMATION
December 31, 2016
Page 50
2016 2015 2014
Contractually Required Contribution (Actuarially
Determined)$1,011,908 $950,147 $943,118
Contributions in Relation to the Actuarially
Determined Contributions
$1,048,897 $949,634 $943,118
Contribution deficiency (excess)($36,989)$513 $0
Covered - Employee Payroll $6,670,248 $6,162,431 $6,278,545
Contributions as a percentage of covered-employee
payroll 16%15%15%
* Fiscal year 2014 was the 1st year of implementation, therefore only three years are shown
Schedule of Contributions
Cost Sharing Defined Benefit Plans
As of June 30
Last Ten Years*
TRUCKEE DONNER PUBLIC UTILITY DISTRICT
REQUIRED SUPPLEMENTARY INFORMATION
December 31, 2016
Page 51
POSITION OF OTHER POST EMPLOYMENT BENEFIT PLANS
Accrued Actuarial Unfunded Funded Annual
Valuation Liabilities Value of Liabilities Ratio Covered UL as a %
Date*(AL)Assets (AVA)(UL)(AVA/AL)Payroll of Payroll
01/01/2006 2,328,500$ -$ 2,328,500$ 0.0%5,542,800$ 42.0%
01/01/2007 1,369,600$ 198,800$ 1,170,800$ 14.5%4,925,600$ 23.8%
01/01/2009 1,748,000$ 230,900$ 1,517,100$ 13.2%5,276,400$ 28.8%
01/01/2011 2,501,800$ 645,700$ 1,856,100$ 25.8%6,307,400$ 29.4%
07/01/2011 2,657,000$ 661,400$ 1,995,600$ 24.9%6,226,000$ 32.1%
07/01/2013 2,960,600$ 1,079,900$ 1,880,700$ 36.5%6,409,000$ 29.3%
07/01/2015 6,755,593$ 1,579,982$ 5,175,611$ 23.4%6,360,511$ 81.4%
*Retire Health Plan funding began in 2007. Valuations are required once every two years. The valaution
date changed to July 1 in compliance with GASB Statement No. 57.
For the Years Ended January 1, 2006, 2007, 2009, 2011 and July 1, 2011, 2013, 2015*
Retiree Health Plan Funding History
SUPPLEMENTARY INFORMATION
TRUCKEE DONNER PUBLIC UTILITY DISTRICT
SUPPLEMENTARY INFORMATION
December 31, 2016
Page 53
CONSOLIDATING STATEM ENT OF NET POSITION
As of December 31, 2016
Electric Operations Water Operations Eliminations Totals
ASSETS AND DEFERRED OUTFLOWS OF RESOURCES
CURRENT ASSETS
Funds
Operating 5,894,981$ 1,957,149$ -$ 7,852,130$
Designated 8,207,261 2,552,277 - 10,759,538
Restricted 1,317,925 2,975,360 - 4,293,285
Total Funds 15,420,167 7,484,786 - 22,904,953
Accounts receivable, net 1,134,576 685,597 - 1,820,173
Unbilled revenues 2,090,179 821,022 - 2,911,201
Accrued interest receivable 8,518 56,526 - 65,044
Materials and supplies 478,997 177,984 - 656,981
Prepaid expenses 259,632 199,632 - 459,264
Other 45,985 50,380 - 96,365
Total Current Assets 19,438,054 9,475,927 - 28,913,981
NON-CURRENT ASSETS
Other Non-Current Assets
Restricted funds - 1,876,032 - 1,876,032
Special assessments receivable - 3,692,876 - 3,692,876
Other 925,520 - - 925,520
Total Other Non-Current Assets 925,520 5,568,908 - 6,494,428
DEFERRED OUTFLOWS OF RESOURCES
Pension 2,403,030 1,602,020 - 4,005,050
Unamortized loss on refunding - 609,580 - 609,580
Unamortized redemption premium 149,934 - - 149,934
Total deferred outflows of resources 2,552,964 2,211,600 - 4,764,564
CAPITAL ASSETS
Utility plant 68,996,114 113,272,679 - 182,268,793
Accumulated depreciation (23,555,362) (39,817,376) - (63,372,738)
Construction work in progress 2,219,434 2,486,842 - 4,706,276
Total capital assets 47,660,186 75,942,145 - 123,602,331
TOTAL ASSETS AND DEFERRED OUTFLOWS OF RESOURCES 70,576,724$ 93,198,580$ -$ 163,775,304$
TRUCKEE DONNER PUBLIC UTILITY DISTRICT
SUPPLEMENTARY INFORMATION
December 31, 2016
Page 54
Electric Operations Water Operations Eliminations Totals
NET POSITION AND LIABILITIES
CURRENT LIABILITIES
Other liabilities
Accounts payable 2,464,625$ 41,889$ -$ 2,506,514$
Customer deposits 382,405 85,763 - 468,168
Other 644,779 273,798 - 918,577
Total other liabilities 3,491,809 401,450 - 3,893,259
Current liabilities payable from restricted assets:
Current portion of long-term debt 819,191 2,386,852 - 3,206,043
Accrued interest payable 1,570 161,589 - 163,159
Total Current Liabilities Payable from Restricted Assets 820,761 2,548,441 - 3,369,202
Total Current Liabilities 4,312,570 2,949,891 - 7,262,461
NON-CURRENT LIABILITIES
Long-term debt, net of discounts and premiums 4,340,000 23,244,323 - 27,584,323
Net pension liability 6,150,197 4,100,132 - 10,250,329
OPEB liability 431,530 287,687 - 719,217
Installment loans 58,403 - - 58,403
Unearned revenues 2,587,458 486,049 - 3,073,507
Total non-current liabilities 13,567,588 28,118,191 - 41,685,779
Total Liabilities 17,880,158 31,068,082 - 48,948,240
DEFERRED INFLOWS OF RESOURCES
Pension 958,276 638,850 - 1,597,126
Total deferred inflows of resources 958,276 638,850 - 1,597,126
NET POSITION
Net investment in capital assets 42,500,995 50,920,550 - 93,421,545
Restricted for debt service 1,316,355 4,695,114 - 6,011,469
Unrestricted 7,920,940 5,875,984 - 13,796,924
Total Net Position 51,738,290 61,491,648 - 113,229,938
TOTAL LIABILITIES, DEFERRED INFLOWS OF RESOURCES AND NET POSITION 70,576,724$ 93,198,580$ -$ 163,775,304$
TRUCKEE DONNER PUBLIC UTILITY DISTRICT
SUPPLEMENTARY INFORMATION
December 31, 2016
Page 55
STATEMENTS OF REVENUES, EXPENSES AND CHANGES IN NET POSITION
For the Year Ended December 31, 2016
Electric Operations Water Operations Eliminations Totals
OPERATING REVENUES
Sales to customers 21,713,614$ 11,312,973$ -$ 33,026,587$
Interdepartmental sales 1,138,637 2,224 (1,140,861) -
Standby fees 22,190 138,480 - 160,670
Cap and trade proceeds 1,172,306 - - 1,172,306
Other 1,024,468 608,473 (388,795) 1,244,146
Total Operating Revenues 25,071,215 12,062,150 (1,529,656) 35,603,709
OPERATING EXPENSES
Purchased power 11,511,308 - - 11,511,308
Operations and maintenance 3,607,347 4,484,787 (1,140,861) 6,951,273
Consumer services 1,474,241 656,181 - 2,130,422
Administration and general 2,466,085 2,254,537 (388,795) 4,331,827
Pension expense 732,355 488,236 - 1,220,591
OPEB expense 431,531 287,687 - 719,218
Depreciation 2,576,192 3,660,841 - 6,237,033
Total Operating Expenses 22,799,059 11,832,269 (1,529,656) 33,101,672
Operating Income 2,272,156 229,881 - 2,502,037
NON-OPERATING REVENUE (EXPENSES)
Special tax revenue - - - -
Investment income 101,039 267,722 - 368,761
Interest expense (2,856) (895,137) - (897,993)
Amortization (6,815) (5,784) - (12,599)
Other non-operating revenues - - - -
Other non-operating expenses (78,838) (66,240) - (145,078)
Gain (loss) on disposition of assets (454) (1,060) - (1,514)
Total Non-Operating Expenses 12,076 (700,499) - (688,423)
Income Before Contributions 2,284,232 (470,618) - 1,813,614
CAPITAL & OTHER CONTRIBUTIONS, net
Capital Contributions 809,436 889,674 - 1,699,110
Intercompany Debt Service - Pension Sidefund 302,004 (302,004) - -
Total Capital and Other Contributions, net 1,111,440 587,670 - 1,699,110
CHANGE IN NET POSITION 3,395,672 117,052 - 3,512,724
NET POSITION - Beginning of Year 48,342,618 61,374,596 - 109,717,214
NET POSITION - END OF YEAR 51,738,290$ 61,491,648$ -$ 113,229,938$
TRUCKEE DONNER PUBLIC UTILITY DISTRICT
SUPPLEMENTARY INFORMATION
December 31, 2016
Page 56
CONSOLIDATING STATEMENT OF CASH FLOWS
For the Year Ended December 31, 2016
Electric Operations Water Operations Eliminations Total
CASH FLOWS FROM OPERATING ACTIVITIES
Received from customers 25,263,014$ 11,444,420$ (1,529,656)$ 35,177,778$
Paid to suppliers for goods and services (15,624,015) (5,381,779) 1,529,656 (19,476,138)
Paid to employees for services (4,089,819) (2,342,953) - (6,432,772)
Net Cash Flows from Operating Activities 5,549,180 3,719,688 - 9,268,868
CASH FLOWS FROM NONCAPITAL FINANCING ACTIVITIES
Debt issuance costs 78,838 - - 78,838
Proceeds from refunding 5,353,413 - - 5,353,413
Principal payments on long-term debt (6,102,838) - - (6,102,838)
Interest payments on long-term debt (250,584) - - (250,584)
Net Cash Flows from Noncapital Financing Activities (921,171) - - (921,171)
CASH FLOWS FROM CAPITAL AND RELATED
FINANCING ACTIVITIES
Capital expenditures for utility plant (3,086,341) (4,334,811) - (7,421,152)
Cost of disposal of property net of salvage (76,810) (1,621) - (78,431)
Capital contributions, connection and facility fees 692,358 664,373 - 1,356,731
Special assessments receipts - 670,914 - 670,914
Special tax receipts - - - -
Debt issuance costs - 66,240 - 66,240
Proceeds from refunding - 3,128,760 - 3,128,760
Principal payments on long-term debt (9,745) (5,487,414) - (5,497,159)
Interest payments on long-term debt 246,955 (895,743) - (648,788)
Cash Flows From Capital and Related Financing Activities (2,233,583) (6,189,302) - (8,422,885)
CASH FLOWS FROM INVESTING ACTIVITIES
Interest income received 114,807 292,186 - 406,993
Cash Flows from Investing Activities 114,807 292,186 - 406,993
Net Change in Cash and Cash Equivalents 2,509,233 (2,177,428) - 331,805
CASH AND CASH EQUIVALENTS – Beginning of Year 12,930,593 9,663,002 - 22,593,595
CASH AND CASH EQUIVALENTS – END OF YEAR 15,439,826$ 7,485,574$ -$ 22,925,400$
NONCASH CAPITAL AND RELATED FINANCING ACTIVITIES
During 2016: $118,682 and $70,494 of capital assets were contributed to the electric and water utilities, respectively, by customers and developers.
$759,217 and $921,498 of prior period unearned revenues were recognized by the electric and water utilities, respectively.
$1,299,588 and $328,788 of prior period unearned revenues were recognized by the component units, Gray's Crossing and Old Greenwood, respectively.
TRUCKEE DONNER PUBLIC UTILITY DISTRICT
SUPPLEMENTARY INFORMATION
December 31, 2016
Page 57
For the Year Ended December 31, 2016
Electric Operations Water Operations Eliminations Total
RECONCILIATION OF OPERATING INCOME TO NET CASH
FLOWS FROM OPERATING ACTIVITIES
Operating income 2,272,156$ 229,881$ -$ 2,502,037$
Noncash items included in operating income
Depreciation and amortization 2,576,192 3,660,841 - 6,237,033
Depreciation charged to other accounts 123,580 140,788 - 264,368
Intercompany Transfer 302,004 (302,004) -
Pension expense - GASB 68 732,354 448,236 1,180,590
Deferred Pension Contributions - GASB 68 (660,747) (400,498) (1,061,245)
OPEB 431,531 287,687 719,218
Accounts receivable and unbilled revenues (70,698) (254,822) - (325,520)
Materials and supplies 10,390 (27,929) - (17,539)
Prepaid expenses and other current assets (11,181) (11,181) - (22,362)
Accounts payable (471,090) (5,498) - (476,588)
Customer deposits 39,332 5,336 - 44,668
Other current liabilities 275,357 (51,149) - 224,208
NET CASH FLOWS FROM OPERATING ACTIVITIES 5,549,180$ 3,719,688$ -$ 9,268,868$
RECONCILIATION OF CASH AND CASH EQUIVALENTS
TO THE BALANCE SHEET
Operating 5,894,981$ 1,957,149$ -$ 7,852,130$
Designated 8,207,261 2,552,277 - 10,759,538
Restricted bond funds - current 1,317,925 2,975,360 - 4,293,285
Restricted bond funds - non-current - 1,876,032 - 1,876,032
Total Cash and Investments 15,420,167 9,360,818 - 24,780,985
Less: Long-term investments - (1,698,880) - (1,698,880)
Mark to market adjustment 19,659 (176,364) - (156,705)
TOTAL CASH AND CASH EQUIVALENTS 15,439,826$ 7,485,574$ -$ 22,925,400$