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Home My WebLink About6 Strategic Plan 2003 Agenda Item # j DONNER Public Utility District Memorandum To: Board of Directors From: Peter Holzmeister Date: September 24, 2002 Subject: Strategic Plan for 2003 A strategic plan workshop was held in August, 2002, facilitated by Bob Rauch. Attached is a document reflecting the notes written by Bob on flip charts. In the past, the flip chart notes have become our strategic plan for the coming year. I am suggesting we adopt this set of notes as our plan for 2003. You may recall that during the August 21 workshop we did not get entirely through the strategic issues that had been identified early in the meeting. Specifically, we did not develop an action plan for Issues 7, 8 and 9, Technology Plan, Community Relations, and Customer Service respectively. I took a first crack at completing the action plan for these items. I suggest the Directors take a look at these items and let me know if I described a reasonable approach Staff will use this plan as the foundation for preparation of the 2003 Budget RECOMMENDATION: I recommend that the board adopt the Strategic Plan for 2003 Truckee Donner Public Utility District Board of Directors Strategic Planning Workshop August 21, 2002 A. Issues for Discussion 1. Broadband Financing Marketing Construction Staffing/organization Regulatory 2. Water supply New projects Water supply Conservation System operation, maintenance, replacement Urban Water Management Plan Regulatory changes I Corporation Yard 4, Power Supplies 5. Organization/ Staffing 6. Financial Master Plan 7. Technology Plan 8. Community Relations 9. Customer Service 10. District Survival 11. Board Processes B. Action Plan Issue 1. Broadband Issue: Board has decided to go into broadband business- unless there is a significant surprise or obstacle. Financially this will be substantial. The method of financing has not been selected. Lease or COP? Page 1 $14 million needed for only 2 — 3 year period. Obtain a lender. We are developing a business plan. Internal issues to get It done- we've been inching along Action: Phase One Obtain anchor tenants: 1 month Franchise agreement with the Town of Truckee: 2 months Pilot project customers Obtain financing Phase Two Preparation of bid documents (2002) Award of construction contracts (Jan 2003) LAFCo approval (2002) When: Broadband will be under way by spring 2003 — Development Plan Who: Alan Harry, consultants, attorney and others = adequate team in place Note: Will be adding broadband customers to billings Determine who will perform maintenance Continue marketing. Must address the realities of conducting the business—people, equipment, support systems, etc. When: Must also be accomplished by spring 2003: Develop and Implement Plan Who: Mary, Jim Wilson, Kathy Neus, others Issue 2. Water System Issue 2.1: New facilities for growth Pace of growth is strong and accelerating. Staffing increase equals 1 person per year. Financing. We do not have in-house money to front the new facility costs. Developers will eventually repay us. Problem is cash flow. Action: a) Approach lenders willing to front the money on basis of repayment of projects b) Consider asking developers to front the money c) Consider formation of assessment district. d) Consider SRF funding e) Develop other methods of addressing this cash flow problem. When: Board will hold special workshop on this by the end of 2002. Page 2 Who: Mary, Ed, Peter, consultant Issue 2.2: Water System Maintenance & Replacement We are fixing the system in an ad-hoc manner. There is no managed systematic maintenance/replacement program that is cost effective. Need to develop a coherent maintenance program Will require more people and capital costs = rate increases. When: Input to District budget by 9/30/02, will have maintenance replacement program and costs ready. Who: Ed, and crew Issue 2.3: Regulatory changes Many new regulatory requirements are being imposed Work is being pushed to the agencies rather than the regulator. New NPDES requirement (1 acre) Huge new regulations— "exponential growth in number and complexity" Probable cost = 1 new engineer devoted to permitting issuer Action: Bring added personnel requirement to the Board When: In budget process Who: Ed Issue 3. Corporation Yard Issue: Corporation yard The yard at headquarters is full. There are two other yards at different sites. Must add roofs for over roughly half of yard space. Losing the lease on one of the peripheral yards. Have one large property- 130 acres. We need 10 acres for a new corporation yard. We will sell the remainder of the property and use funds to pay for the building of our space needs. Action: Decide on piece we want to keep. Offer rest of property for sale. When: Early 2003. Board will see recommendation and take action. Who: Kathy Neus will work with district staff group to make plan, including Ed and Steve Page 3 Issue 4. Power Supplies Issue 4.1: Power suppiy Must renegotiate a reasonable contract = current contract too expensive. We are asking court relief for modification of the contract. May go to mediation. FERC is involved. Action: Legal and other action are currently underway. Who: Steve Hollabaugh Issue 4.2: Change in Facility fee Must increase the facility fee Action: Bring consideration to Board Who: Steve and Joe Horvath Issue 5. Organization/Staffing Issue: Most issue solutions call for additional staff- both worker and management level. Broadband—will it be a new department? or fall under existing departments? Action Decision will be reached in time to meet broadband launch. When: Some at 2003 budget time, some at broadband launch time. Who: Peter Issue 6. Financial Master Plan Issue: Who should do this? Answer: Consultant Must collect a lot of data for use by a consultant. Elements: Growth Needs Capital needs Maintenance / replacements needs Current fees Current rates Debt / bonding Cash Flow Page 4 Personnel needs Reserves How much do current customers pay? How much do new customers pay? Meeting legal requirements Political Issue Revise long term plan (10-20 years) with annual cash flow analysis to provide financial guidance to the Board. Mary has collected some information Action: Bring in a financial consultant on a limited basis to clarify the requirements for a financial plan = maybe a few days of a reconnaissance visit. When: November 2002 Who: Peter, Mary- will meet with consultant and report to the Board Issue 7. Technology Plan Issue: The District has invested in technology but we are not yet getting full benefit from the investment. We are not using the full capability of the technology that we have. The various components do not communicate with one another. Action: Develop a plan to take full advantage of our technology capability. Fund that plan in the budget, even though it may require multiple years to fully implement. Who: Steve Hollabaugh will lead a committee consisting of Mary, tan, and representatives of water and electric operations Issue 8. Community Relations Issue: The District needs to inform its customers of programs and services. We are prohibited from using the cable television system owned by USA Media. District needs to pursue other means of getting our message out: Channel 6, Sierra Sun, mailers, and participation in community activities. Action: Develop a Community Relations Plan for submission to the Board of Directors When: By October 15, 2002 Who: Page 5 Scott Issue 9. Customer Service Issue: It has been years since the District reviewed the methods it uses to deal with its customers, especially in regard to billing processes. Over the years business practices have continued to implement new tools, such as ATM and credit card payments, e- commerce, simplified service application forms, and so forth. Action: Review District policies, procedures, and practices related to dealing with our customers and prepare a draft plan for submission to the board to modernize our customer relations. When: Second quarter of 2003 Who: Mary Issue 10. District Survival Issue: A permanent concern. Being big is good. Growth is critical Action: Continue managed growth. Look outside the "box' for regional opportunities to do a better job. Look over shoulder- bring in special district representative on LAFCo Do a good job Who: Peter and the management staff and the Board of Directors Issue 11. Board Processes Issue: Board needs to adapt and follow a set of norms. Board members need to agree on these norms. Free staff to do its job. Action: Hold a Board workshop When: October 2, 2002- afternoon Who: Bob Rauch Page 6