HomeMy WebLinkAbout9 Budget Kick Off MeetingIfTRUCKEE DN ER ct
ublic UtilityDistrict
BUDGET
To: Board of Directors
From: Regina Wise
Date: September 02, 2015
Subject: Discussion of FY16 & FY17 Budget: Objectives; Goals;
Assumptions; Labor; and Debt
1. WHY THIS MATTER IS BEFORE THE BOARD
This item begins the formal process for preparation of the FY16 & FY17 budget.
2. HISTORY
In 2008 the Board implemented two year budget cycles. As we move forward we will
be compiling the FY16 and FY17 budgets while closely reviewing FY14 & FY15
approved budget and actuals. As presented in the last Board meeting we are on track
to complete FY15 at 95% of budget for the electric division and 97% of budget for the
water department. FY14 the electric division was 95% of budget and the water
division was 96% of budget. The FY16 & FY17 budget will be similar to the FY14 &
FY15 budget.
3. NEW INFORMATION
SCHEDULE
The schedule for the budget process is as follows:
September 2 (Tonight) -
Discuss the objectives, goals, assumptions, labor and debt.
September 16 -
Discuss the purchased power plan.
nr,tnhar 7 -
Discuss the operating and capital budget for the Electric and Water Utilities.
n(--tnhar 91 -
Discuss the operating and capital budgets for supporting services;
Discuss reserve funds; and
Discuss revenue, rates, fees and charges.
November 4 -
Present the Financial Master Plan;
Present a draft of the FY16 & FY17 budget; and
Hold a public hearing regarding the budget.
November 18-
Consider adoption of the FY16 & FY17 budget.
OBJECTIVES AND GOALS
The District's Mission is "to provide reliable, high quality water and electrical power
services while meeting customer demand, and to manage District resources in a safe,
open, responsible, environmentally sound manner at the lowest practical cost." This
budget process is essential in establishing goals and objectives that are in line with
our mission statement, goals, and objectives defined in Title 1. Here are examples
that will be of focus for the FY16 & FY17 budget consistent with district code:
Electric Division:
• Maintain focus on repair and maintenance of district facilities and equipment to
continue to guarantee reliable and high quality electric service to our customers.
Including funding to support pole replacements, and distribution replacement and
improvement projects. The FY16 & FY17 budget also includes a meter
replacement program.
Water Division:
• The water division will also focus on repair and maintenance of district facilities
and equipment to continue to guarantee reliable and high quality water service to
our customers. Including pump station and well maintenance and repairs, pipeline
replacements and continue the meter replacement project of water meters across
the district.
ASSUMPTIONS
As stated the FY16 & FY17 budget will be similar to the FY14 & FY15 budget. As
compared to the prior budget, the assumptions and proposed changes are:
• Customer electric rates will not be increased in FY16 & FY17;
• Customer water rates will increase 6% in FY16, and water rates for FY17 have
a potential maximum rate increase of 5%; and
• Inflation will increase cost of supplies, materials and services by 3% in FY16
and in FY17.
Staffing is proposed to be similar to FY15 with the following changes-
• The Board has provided direction for contract negotiations, currently in
process;
• The electric department has an additional full time employee as budgeted in
FY15 for succession planning;
• A Finance and Accounting Manager was added to support the restructuring of
the Administrative Services Department, ensuring accounting depth as
expected for the District;
• In FY16 an electrician will be added to support SCADA\operational controls for
the water division; and
• In FY17 an electric engineer will be added for the future planned automated
meter information integration and upgrade project as well as succession
planning for the Electric Division.
DEBT
No new debt is expected to be incurred in this budget cycle. Current year end FY15
debt projection is; Electric Utility $5.6M, Water Utility $28.6M. FY16 debt is projected
as follows; Electric Utility $4.9M, Water Utility $26M. FY17 debt is projected as
follows; Electric Utility $16M, Water Utility $23.1 M.
4. FISCAL IMPACT
There is no fiscal impact on this board item at this time. This budget workshop is parl
of the overall budget process that will affect the District's spending for the next twc
fiscal years.
5. RECOMMENDATION
Receive this report and provide comments to staff.
Regina Wise
Accounting and Finance Manager
Michael D. Holley
General Manager