HomeMy WebLinkAbout10-Budget FY14 and FY15 Budget Summary, Ten-Year Financial Master Plan ProjectionAgenda Item # 10
BUDGET
To:
Board of Directors
From:
Robert Mescher
Date:
November 06, 2013
Subject: Budget: FY14 and FY15
a) FY14 and FY15 Budget Summary
b) Ten -Year Financial Master Plan Projection
1. WHY THIS MATTER IS BEFORE THE BOARD
This item continues the preparation process of the FY14 and FY15 Budget.
2. HISTORY
District Code requires the District to prepare a two-year budget.
BUDGET PROCESS SCHEDULE
September 4, 2013
• Discuss the budget objectives, goals, assumptions, and debt
September 18, 2013
• Review the Purchased Power Plan
• Discuss CEC Changes to the Renewable Portfolio Standard (RPS)
• Review the Proposition 218 process for water rates
October 2, 2013
• Discuss the Electric and Water Utility operational and capital budgets
October 16, 2013
• Set a public hearing date for the budget
• Discuss the supporting services operational and capital budgets
• Review a draft summary of FY14 and FY15 Budget
• Review a draft ten-year Financial Master Plan
• Review revenue requirements
• Discuss the projected reserve fund balances
November 6 (tonight)
• Receive the draft FY14 and FY15 Budget and Financial Master Plan
• Conduct a public hearing regarding the FY14 and FY15 Budget
• Receive a water rate study (HDR Engineering, Inc.)
• Accept a draft ordinance to set water rates
• Set a date for a public hearing regarding water rates
November 20, 2013
• Consider adopting the FY14 and FY15 Budget with the overhead allocation
rates and Purchased Power Plan
January 15, 2014
• Hold a public hearing regarding water rates
• Consider adopting an ordinance for water rates effective after February 14,
2014
BUDGET ASSUMPTIONS
At the September 4, 2013 Board Meeting, staff presented the following budget
assumptions:
• Annual inflation is expected to be 3%
• New development activity will increase
• No new debt
• No planned electric rate increase in FY14 & FY15
• Estimated water rate annual increase of 3% in FY14 & FY15
• $5 monthly water meter surcharge (7.5%) ends December 31 st
• Estimated labor rate increase of 2% in FY14
• Estimated labor rate increase of 3% in FY15
• One IT employee added in FY14
• One Work Order employee restored in FY15
Budget Highlights
Electric Department
• No rate increase
• Budgeted revenue flat in FY14; 1 % increase in demand in FY15
• No other significant changes in year-to-year expenses
• Focus will continue on system maintenance, Master Plan projects, SCADA
Reliability Improvement project, and the reliability of Donner Lake substation
• New construction is anticipated to increase compared to recent years
Water Department
• Estimated annual rate increase of 3% in FY14 and FY15
• Budgeted 1 % increase in demand in FY14 and FY15
• No significant changes in year-to-year expenses
• Focus will continue on the water SCADA project, meter installations, and a
water main project in FY14
Reorganization of Power Supply/GIS departmental expenses
• Name will change to Information Technology (IT)/GIS department
• Power supply expenses will be charged to the Electric Operations department
• All departmental IT costs will be charged to the IT/GIS department
• 2013 budget and actual results were normalized to account for these changes
Supporting Services
• One additional position in IT/GIS in FY14
• One work order position restored in FY15
• No significant changes in other expenses
• Focus on improving reliability and security of communications and SCADA
systems
3. NEW INFORMATION
Attachment 1 is a draft of the proposed FY14 and FY15 Budget. It includes:
• Executive Summary;
• Part I District's Mission Statement and Goals;
• Part II Electric Utility's Operating, Repair and Maintenance Plan;
• Part III Water Utility's Operating, Repair and Maintenance Plan;
• Part IV Electric and Water Capital Improvement Plans; and
• Part V Appendices-
* 1 Interdepartmental Rent
0 2 Budgeted Positions by Department
o 3 Labor Overhead
o 4 Transportation Overhead
o 5 Administrative Overhead
0 6 Construction Overhead
0 7 Electric Debt Schedule
0 8 Water Debt Schedule
0 9 Vehicle Replacement Schedule
Attachment 2 is a the ten-year Financial Master Plan that illustrates that the two-year
budget is consistent with the District's long-term goals.
4. FISCAL IMPACT
The Financial Master Plan verifies that the proposed FY14 and FY15 Budget is
consistent with the District's long-term goals.
Staff is proposing a balanced budget for FY14 and FY15. Total revenue and transfers
from other existing funds will equal total expenses and transfers to reserves.
5. RECOMMENDATION
Receive this report and provide comments to staff.
Robert Mescher
Administrative Services Manager
Michael D. Holley
General Manager