HomeMy WebLinkAbout2000-12-06 Agenda Packet - Board (9) Agenda Item #
Diu i
DONNER
� i Public Utility District
Memorandum
To: Board of Directors
From: Peter L. Holzmeister
Date: December 4, 2000
Subject line: Revisions to the draft 2001 budget
A public hearing has been scheduled to review the draft budget on Wednesday evening.
After the hearing the Board will be in a position to adpt the budget, or modify and adpot
it, or postpone action on the it until a later meeting.
At the last Board meeting we paticipated in a budget workshop. There seemed to be
consensus that I rework the budget with a sharper pencil and prepare a plan that
eliminates the 11% bill credit on April 1, 2001. With the help of Steve Hollabaugh and
Mary Chapman I have prepared a plan that accomplishes that objective. I have also
prepared two other options for your consideration.
The other two options are being presented to you because the power market continues
to deteriorate precipitiously. The picture today is significantly more severe than the
piclture of just one week ago.
OPTION 1
A) Eliminate the bill credit on April 1, 2001
B) The cost is approximately $280,000
C) We manage the cost in the following way
1) Eliminate $100,000 from the budget
2) Carefully monitor actual revenues and power costs compared to budgeted
revenues and power costs during January, February and March.
3) Use the Building Fund to cover $180,000, if necessary
D) Prepare the community for future electric rates by describing what is happening
throughout the west coast in the deregulated industry.
OPTION 2
A) Eliminate the bill credit on January 1
B) Increase electric rates on July 1 by an amount to be determined, in order to provide a
soft landing in 2002
C) Restrict the revenues generated by the rate increase to the rate stabilization fund.
OPTION 3
A) Eliminate the bill credit In April, 2001
B) Reduce budget by $100,000 and use $180,000 of bilding fund if necessary
C) Increase electric rates by an amount to be determined in April or August to provide a
soft landing in 2002
D) Restrict the revenues generated by the rate increase to the rate stabilization fund.
I will be prepared to discuss these matters further at the board meeting on Wednesday
evening.