HomeMy WebLinkAbout12 Glenshire Surcharge Status Agenda Item # 12
Public
WORKSHOP
To: Board of Directors
From: Bob Mescher
Date: November 03, 2010
Subject: Glenshire Surcharge Status
1. WHY THIS MATTER IS BEFORE THE BOARD
This Board requested an update of the status of the Glenshire water system
acquisition surcharge.
2. HISTORY
In 2002, the District acquired the Glenshire Mutual Water Company (GMWC) and its
customers. In order to connect the GMWC pipelines and customers to the District's
system, capital improvements were needed. These projects included pipeline
extensions and replacements, pumping capacity increase at the District's Glenshire
Drive Well, well abandonment and other system upgrades. The GMWC customers
agreed to reimburse the District for these costs.
The GMWC transferred all of its assets to the District. Included in the asset transfer
was cash and land. The cash and land sales proceeds have been used to offset
costs incurred by the District to install and upgrade capital assets. The District also
financed a portion of the upgrade cost with both a 15 year external loan in the amount
of $1,740,000 and a $246,000 internal loan. To pay off the external loan, the
Glenshire customers were assessed a $10.75 surcharge on their monthly water bills.
Land sales, lease proceeds and surcharge proceeds were used to extinguish the
internal loan.
The surcharge was projected to end in 2017.
Attached is a report of the financial activity from 2002 to present.
3. NEW INFORMATION
In February 2009, the internal loan was extinguished with the sale proceeds of the
southern portion of the Glenshire Drive parcel and $33,000 of the accumulated
surcharge.
One remaining parcel, the northern portion of the Glenshire Drive parcel, was
marketed for sale in 2009, but was removed from the market. It is currently leased to
the Glenshire Fire Station, and will be placed back on the market in 2011, after the
end of the lease.
4. FISCAL IMPACT
There is no direct fiscal impact associated with this workshop item.
5. RECOMMENDATION
Receive this report and provide comment.
Mary Chap n- 0 Michael D. Holley
Administrative Services Manager General Manager
Attachment 1
TRUCKEE DONNER PUBLIC UTILITY DISTRICT
GLENSHIRE MUTUAL WATER COMPANY ACQUISITION, EXPENDITURES,AND SURCHARGE
NOVEMBER 2002 THROUGH SEPTEMBER 2010
ACQUISITION AND PROJECT COSTS
Plus:
740000
External Loan proceeds $ 1,907,
Credit for cash and equipment received from Glenshire 907,648
48
Credit for land sales-Manchester Drive, Somerset Drive parcels, Glenshire Dr-South Side 345,396
Credit for use of Glenshire property for storage through 5/31/07 59,750
Surcharge proceeds to extinguish internal loans from District's Land Sales Fund (02/18/2009) 33,485
Subtotal cash and credits $ 3,086,279
Less:
Fixed charges for accruals and projects defined in contract between GMWC & District $ 571,000.00
Charges for additional projects necessary to connect to District water system 2,483,266.00
Interest on internal loans from District's Land Sales Fund 2004 through 02/18/2009 32,013.00
Subtotal project costs $ 3,086,279
Total cash and credits less project costs $
SURCHARGE&LAND LEASE PROCEEDS
Plus:
08918
$10.75 per month billing surcharge since 2002 $ 1,514,465
Lease proceeds from Glenshire Fire Station 14,
Total Proceeds $ 1,523,383
83
Less:
Principal and interest payments on $1,740,000 loan through 09/30/2010 $ 1,292,591
Surcharge proceeds to extinguish internal loans from District's Land Sales Fund (02/18/2009) 33,485
Total Uses $ 1,326,076
Balance of funds held $ 197,307
EXTERNAL LOAN BALANCE
Principal balance on Municipal Services Loan#1552 for$1,740,000 at 09/30/2010 $ 1,005,389
(November 2002, 15 year loan, 5.11% interest)