budget workshop proposed biennial budget for fys 2019/20 ...€¦ · fys 2030-2039. millions. $538....
TRANSCRIPT
![Page 1: Budget Workshop Proposed Biennial Budget for FYs 2019/20 ...€¦ · FYs 2030-2039. Millions. $538. RP-5 Expansion Construction. Recycled Water Interties. Asset Management Program](https://reader034.vdocument.in/reader034/viewer/2022050419/5f8e9dfe87cc9772a00379cd/html5/thumbnails/1.jpg)
Budget WorkshopProposed Biennial Budget for
FYs 2019/20 and 2020/21
Finance and AccountingApril 3, 2019
![Page 2: Budget Workshop Proposed Biennial Budget for FYs 2019/20 ...€¦ · FYs 2030-2039. Millions. $538. RP-5 Expansion Construction. Recycled Water Interties. Asset Management Program](https://reader034.vdocument.in/reader034/viewer/2022050419/5f8e9dfe87cc9772a00379cd/html5/thumbnails/2.jpg)
Proposed Biennial Budget FYs 2019/20 – 2020/21Supports Board-Adopted Business Goals
FISCAL RESPONSIBILITY
Rate Study to ensure full
recovery of costs
Financing capital projects
Cost containment
WORK ENVIRONMENT
Training & development
Succession planning
WATER RELIABILITY
Water use efficiency programs
Chino Basin Program
WASTEWATER MANAGEMENT
RP-5 expansion construction
Asset Management
Program
2
![Page 3: Budget Workshop Proposed Biennial Budget for FYs 2019/20 ...€¦ · FYs 2030-2039. Millions. $538. RP-5 Expansion Construction. Recycled Water Interties. Asset Management Program](https://reader034.vdocument.in/reader034/viewer/2022050419/5f8e9dfe87cc9772a00379cd/html5/thumbnails/3.jpg)
Biennial Budget FY 2019/20 and 2020/21
Adoption of two “single-year” budgets and TYCIP
Appropriation limited to a single year
Mid-cycle review for the second budget year
3
![Page 4: Budget Workshop Proposed Biennial Budget for FYs 2019/20 ...€¦ · FYs 2030-2039. Millions. $538. RP-5 Expansion Construction. Recycled Water Interties. Asset Management Program](https://reader034.vdocument.in/reader034/viewer/2022050419/5f8e9dfe87cc9772a00379cd/html5/thumbnails/4.jpg)
IEUA Fund Structure
4
IEUA Service Area
Admin Services
Groundwater Recharge
Recycled Water
Water Resources
Non-Reclaimable Wastewater
Regional Wastewater
Capital Operations
![Page 5: Budget Workshop Proposed Biennial Budget for FYs 2019/20 ...€¦ · FYs 2030-2039. Millions. $538. RP-5 Expansion Construction. Recycled Water Interties. Asset Management Program](https://reader034.vdocument.in/reader034/viewer/2022050419/5f8e9dfe87cc9772a00379cd/html5/thumbnails/5.jpg)
Key Drivers Funding Sources
• Stable and distinct revenue components• FY 2019/20 last year of the multi-year rates adopted in 2015.
– Rate Study Update for fiscal years beginning 2020/21. • Conservative projection on new connections;
– 4,000 new wastewater equivalent dwelling units (EDUs)– 4,000 new water meter equivalent units (MEUs)
• 3.5% average growth on property tax receipts
5
![Page 6: Budget Workshop Proposed Biennial Budget for FYs 2019/20 ...€¦ · FYs 2030-2039. Millions. $538. RP-5 Expansion Construction. Recycled Water Interties. Asset Management Program](https://reader034.vdocument.in/reader034/viewer/2022050419/5f8e9dfe87cc9772a00379cd/html5/thumbnails/6.jpg)
Current multiyear rates
(AF) acre foot(EDU) Equivalent Dwelling Unit(RTS TYRA) – Readiness to Serve Ten Year Rolling Average
Five year rates adopted June 2015 for Fiscal Years 2015/16 – 2019/20.
FY 2015/16 FY 2016/17 FY 2017/18 FY 2018/19 FY 2019/20
Effective Date 10/01/15 7/01/16 7/01/17 7/01/18 7/01/19
Wastewater Connection Fee/EDU $5,415 $6,009 $6,309 $6,624 $6,955Monthly EDU Rate $15.89 $17.14 $18.39 $19.59 $20.00
Recycled Water Direct Delivery/AF $350 $410 $470 $480 $490Groundwater Recharge/AF $410 $470 $530 $540 $550
Water Connection Fee /MEU $693 $693 $1,455 $1,527 $1,604RTS TYRA 7YR Phase In n/a 15% 30% 45% 60%Meter Equivalent Unit n/a $0.90 $0.95 $0.99 $1.04
6
![Page 7: Budget Workshop Proposed Biennial Budget for FYs 2019/20 ...€¦ · FYs 2030-2039. Millions. $538. RP-5 Expansion Construction. Recycled Water Interties. Asset Management Program](https://reader034.vdocument.in/reader034/viewer/2022050419/5f8e9dfe87cc9772a00379cd/html5/thumbnails/7.jpg)
Total Funding Sources($ Millions)
7
$0
$50
$100
$150
$200
$250
$300
$350
$400
Amended Proposed Proposed
2018/19 2019/20 2020/21
Mill
ions
Operating Revenues Non Operating Revenues Debt Proceeds
User ChargesRecycled Water Sales
MWD Water Sales
Property Taxes / Connection Fees
RP-5 Expansion ConstructionRecycled Water Interties
$276 $290 $370
Current
![Page 8: Budget Workshop Proposed Biennial Budget for FYs 2019/20 ...€¦ · FYs 2030-2039. Millions. $538. RP-5 Expansion Construction. Recycled Water Interties. Asset Management Program](https://reader034.vdocument.in/reader034/viewer/2022050419/5f8e9dfe87cc9772a00379cd/html5/thumbnails/8.jpg)
Key Drivers Uses of Funds
• No significant changes in total operating expenses – Increase in employment costs offset by lower O&M projects
• Significant higher capital expenditures– RP-5 Expansion construction– Pomona/JCSD Recycled Water Interties– Asset Management Program– Chino Basin Program (CBP)
8
![Page 9: Budget Workshop Proposed Biennial Budget for FYs 2019/20 ...€¦ · FYs 2030-2039. Millions. $538. RP-5 Expansion Construction. Recycled Water Interties. Asset Management Program](https://reader034.vdocument.in/reader034/viewer/2022050419/5f8e9dfe87cc9772a00379cd/html5/thumbnails/9.jpg)
Total Uses of Funds($ Millions)
9
$0
$50
$100
$150
$200
$250
$300
$350
$400
Amended Proposed Proposed
2018/19 2019/20 2020/21
Mill
ions
Operating Expenses Debt Service Capital
$275 $284 $371
EmploymentOperating Costs
MWD Water Purchases
Bonds / State Revolving Fund Loans
RP-5 Expansion ConstructionRecycled Water Interties
Asset Management Program
Current
![Page 10: Budget Workshop Proposed Biennial Budget for FYs 2019/20 ...€¦ · FYs 2030-2039. Millions. $538. RP-5 Expansion Construction. Recycled Water Interties. Asset Management Program](https://reader034.vdocument.in/reader034/viewer/2022050419/5f8e9dfe87cc9772a00379cd/html5/thumbnails/10.jpg)
Employment Costs($ Millions)
FY 2018/19 Current
FY 2019/20 Proposed
%Change
FY 2020/21 Proposed
%Change
Total Employment Cost $55.0 $59.3 7.8% $62.6 5.6%
FY 2019/20 Proposed
% Change
FY 2020/21 Proposed
% Change
COLA (3%) + Merit Increase (2%) $1.1 1.9% $1.6 2.8%
Benefits (pension & health costs) 1.1 1.9% 1.6 2.8%
Increase 11 budgeted positions 2.1 4% - -
Total Change $4.3 7.8% $3.2 5.6%
Support to RP-5 Expansion ConstructionAsset Management ProgramChino Basin Program
FTE + LTE 293 304 304% TOTAL BUDGET 20% 21% 18%
10
![Page 11: Budget Workshop Proposed Biennial Budget for FYs 2019/20 ...€¦ · FYs 2030-2039. Millions. $538. RP-5 Expansion Construction. Recycled Water Interties. Asset Management Program](https://reader034.vdocument.in/reader034/viewer/2022050419/5f8e9dfe87cc9772a00379cd/html5/thumbnails/11.jpg)
Labor allocation by program
FY 2018/19 Current
FY 2019/20Proposed
FY 2020/21Proposed
Wastewater 81% 80% 80%Water 16% 17% 17%Administration 3% 3% 3%Grand Total 100% 100% 100%
11
![Page 12: Budget Workshop Proposed Biennial Budget for FYs 2019/20 ...€¦ · FYs 2030-2039. Millions. $538. RP-5 Expansion Construction. Recycled Water Interties. Asset Management Program](https://reader034.vdocument.in/reader034/viewer/2022050419/5f8e9dfe87cc9772a00379cd/html5/thumbnails/12.jpg)
Succession Planning
• ~30%(77 FTEs) of proposed staffing eligible to retire in the next 5 years– 12 identified critical positions may retire within the next 2 years
• $800,000 per year to support succession planning– Timely recruitment and transition of critical positions– Adequate overlap for knowledge transfer and training – Minimize impact to productivity
12
![Page 13: Budget Workshop Proposed Biennial Budget for FYs 2019/20 ...€¦ · FYs 2030-2039. Millions. $538. RP-5 Expansion Construction. Recycled Water Interties. Asset Management Program](https://reader034.vdocument.in/reader034/viewer/2022050419/5f8e9dfe87cc9772a00379cd/html5/thumbnails/13.jpg)
Proposed TYCIP $924M
13
$92
$185 $160
$103 $95 $41 $39 $43 $50
$117
$0
$50
$100
$150
$200
$400
$500
$550
FY 2020 FY 2021 FY 2022 FY 2023 FY 2024 FY 2025 FY 2026 FY 2027 FY 2028 FY 2029 FYs 2030-2039
Mill
ions
$538
RP-5 Expansion ConstructionRecycled Water Interties
Asset Management Program
RP-1 Capacity Recovery
RP-2 Decommission RP-4 Expansion
$277 M planned over the next two years
![Page 14: Budget Workshop Proposed Biennial Budget for FYs 2019/20 ...€¦ · FYs 2030-2039. Millions. $538. RP-5 Expansion Construction. Recycled Water Interties. Asset Management Program](https://reader034.vdocument.in/reader034/viewer/2022050419/5f8e9dfe87cc9772a00379cd/html5/thumbnails/14.jpg)
Debt Service and Outstanding Principal($ Millions)
$0
$10
$20
$30
FY 2018/19Amended
FY 2019/20Proposed
FY 2020/21Proposed
Interest Expense Principal Payment Financing Expense $0
$100
$200
$300
$400
$500
$600
2018/19 2020/21 2022/23 2024/25 2026/27 2028/29
Outstanding PrincipalRP-5 Expansion Construction$282
RP-1 Capacity Recovery$51
Recycled Water Interties$83
$24.5$26.5 $28.1
14
![Page 15: Budget Workshop Proposed Biennial Budget for FYs 2019/20 ...€¦ · FYs 2030-2039. Millions. $538. RP-5 Expansion Construction. Recycled Water Interties. Asset Management Program](https://reader034.vdocument.in/reader034/viewer/2022050419/5f8e9dfe87cc9772a00379cd/html5/thumbnails/15.jpg)
Total Reserves($ Millions)
15
$187 $231 $232 $238 $236 $237 $258 $281
$338 $381
$421 $455 $427
$-
$50
$100
$150
$200
$250
$300
$350
$400
$450
$500
2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029
Mill
ions
RESERVES TOTAL MINIMUM TOTAL TARGET
Fiscal Year Ending
Future reserves potential use• RP-1 Capacity Recovery• RP-2 Decommission• RP-4 Expansion• Pay down debt
![Page 16: Budget Workshop Proposed Biennial Budget for FYs 2019/20 ...€¦ · FYs 2030-2039. Millions. $538. RP-5 Expansion Construction. Recycled Water Interties. Asset Management Program](https://reader034.vdocument.in/reader034/viewer/2022050419/5f8e9dfe87cc9772a00379cd/html5/thumbnails/16.jpg)
Key take-aways
Balanced Budget.
FY 2019/20 last year of multiyear rates. Rate study underway for FY 2020/21.
RP-5 Expansion construction phase begins evaluation of financing options.
Asset Management Program.
Chino Basin Program.
16
![Page 17: Budget Workshop Proposed Biennial Budget for FYs 2019/20 ...€¦ · FYs 2030-2039. Millions. $538. RP-5 Expansion Construction. Recycled Water Interties. Asset Management Program](https://reader034.vdocument.in/reader034/viewer/2022050419/5f8e9dfe87cc9772a00379cd/html5/thumbnails/17.jpg)
Review and Approval Timeline
17
Month IEUA Committee IEUA Board
Regional Technical
Committee
RegionalPolicy
Committee
March 03/13 03/20 03/28
April 04/10 04/0304/17
04/25 04/04
May 05/08 05/15 05/30 05/02
June 06/12 06/19 06/06