municipal subdistrict - northern water...fulfill the subdistrict’s mission: “to provide water...

2019Annual Budget

Northern Colorado Water Conservancy DistrictMunicipal Subdistrict

MunicipalSubdistrict

B

Municipal Subdistrict, Northern Colorado Water Conservancy District

Table of Contents

Transmittal Letter 1

Our Business Plan 2

General 3

History 4

Service Area and Windy Gap Project Participants 5

Distinguished Budget Presentation Award 6

Community Profile of the Eight Largest Windy Gap Participants 7

Largest Employers 11

Population and Jobs Trends 12

Board of Directors 13

Budget Process 14

Fiscal Policies 15

Subdistrict Organizational Chart 16

Budget Appropriations 17

Windy Gap Water Activity Enterprise Fund Overview 17

Windy Gap Firming Project Water Activity Enterprise Fund Overview 33

Acronyms 39

Glossary 41

Appropriation Resolution 46

Contingency Appropriation Resolution 48

1

Transmittal Letter

Municipal Subdistrict, Northern Colorado Water Conservancy DistrictIntroduction

To the President and Board of Directors,

We are pleased to present a fiscally sound operating and capital budget for fiscal year 2019. The spending plan is just one part of a long-term commitment to provide quality services while preserving long-term financial viability of the Municipal Subdistrict. This budget is designed to fulfill the Subdistrict’s mission: “To provide water resources management, project operations and water conservation services for our project beneficiaries.”

After receiving the final federal permit needed for the Windy Gap Firming Project in May 2017, the focus for fiscal year 2018 and continuing into 2019 is to advance the project so construction of the Chimney Hollow Reservoir may begin. This project is needed to meet a portion of the existing and future wholesale water supply demands within the boundaries of the Subdistrict. Planning, design and funding of the Colorado River Connectivity Channel will continue during fiscal year 2019. Other activities and programs for the Windy Gap Project will be consistent with the past.

Fiscal Year 2019 Budget Summary and Highlights

Windy Gap Water Activity Enterprise Fund

Total Sources of Funds are estimated to be $5.9 million, $0.5 million or approximately 8 percent lower than fiscal year 2018 • Operating revenues totaling $5.2 million • No change in assessment deferral charge - $36 per acre-foot • Other revenues totaling $0.2 million • Contributions totaling $0.5 million for the Colorado River Connectivity Channel

Operating expenses of $5.3 million reflect an increase of $0.2 million or approximately 5 percent higher than fiscal year 2018 • Largest expense is carriage costs amounting to $2.6 million • Programs totaling $1.3 million

Capital Project expenditures of $0.9 million are planned primarily for the Colorado River Connectivity Channel and the pipeline electromagnetic test

Windy Gap Firming Project Water Activity Enterprise Fund

Total Sources of Funds are estimated to be $521.6 million, $514.1 million more than fiscal year 2018, due to anticipated funding for project construction

Capital Project expenditures of $122.5 million are planned for design, mitigation and enhancements and construction for the Chimney Hollow Reservoir

We believe the budget for the Subdistrict’s 49th year of operation meets the Board’s conservative fiscal management and management’s commitment to accountability and strong fiscal management.

Respectfully,

/s/ Bradley D. Wind

Bradley D. WindGeneral Manager

2

Municipal Subdistrict, Northern Colorado Water Conservancy DistrictOur Business Plan

Our Mission

Provide water resources management, project operations and conservation services for project beneficiaries.

Our Values and Principles

• Collaborative, proactive and progressive leadership• Water resources conservation• Environmental stewardship• Personal and corporate ethical integrity and professionalism• Solution-oriented service• Regional cooperation

Our Vision

The Subdistrict will be a leader in insuring a secure water future for northern Colorado.

Our Priorities

• Collect and deliver water• Protect and conserve water supplies• Plan and implement new water supply projects• Cultivate operational and organizational excellence• Maintain and strengthen relationships

Financial Plan - Revenue

Program Objectives

Routine Responsibilities

Annual Budget

Long-Term Board Priorities

Strategic Initiatives

Major Projects

Our Planning Road Map

3

The Subdistrict was organized as a subdistrict of Northern Colorado Water Conservancy District (Northern Water) by decree of the District Court of Weld County, Colorado, on July 6, 1970, pursuant to the Water Conservancy Act. Under the Water Conservancy Act, a subdistrict thus formed is a separate and independent conservancy district with the same powers and legal standing as its parent district and is an independent political subdivision of the State of Colorado. The Subdistrict has the authority to undertake projects separate from those undertaken by Northern Water. The Subdistrict has an agreement with Northern Water whereby Northern Water provides all administrative, operation and maintenance functions for the Subdistrict, and is reimbursed by the Subdistrict for the services rendered.

The Board of the Subdistrict is, by statute, the same as the Board of Northern Water. It has been the practice of the Subdistrict to elect a different slate of officers from those chosen by Northern Water. The staff of Northern Water serves as the staff of the Subdistrict, with the Subdistrict reimbursing Northern Water for the actual time of such staff plus an additional percentage to cover costs and overhead. Northern Water does not approve or modify the Subdistrict’s budget, hold title to any of the Subdistrict’s water rights, authorize issuance of Subdistrict’s bonds or appoint the Subdistrict’s Board or management. Therefore, the Subdistrict is not under control of Northern Water and is not included in Northern Water’s financial reports. The Subdistrict’s fiscal year end is September 30.

The Windy Gap Project

The Windy Gap Project is located just west of the Town of Granby on Colorado’s Western Slope. It consists of a diversion dam on the Colorado River that creates the 445 acre-foot Windy Gap Reservoir, a pumping plant, and a six mile pipeline to Lake Granby. This system is capable of delivering an average of 48,000 acre-feet of water annually, diverted primarily during the spring runoff season between April and July. During these periods of high flows in the Colorado and Fraser rivers, water is pumped from Windy Gap Reservoir to Lake Granby, where it is stored for delivery through the Colorado-Big Thompson Project (C-BT Project) facilities to water users on the Front Range.

Water Allotment Contracts

The Subdistrict has entered into water allotment contracts with each of the initial participants and participating transferees. Allotment contracts provide that participants annually receive their proportional share of Windy Gap water. Every unit equals 100 acre-feet of water, or 1/480 of the annual average yield produced. Each water allotment contract requires participants to make annual payments equal to the corresponding share of the costs related to the Subdistrict’s acquisition of water rights and operation, maintenance and replacement of Windy Gap Project features, as well as carriage charges to Northern Water and U.S. Bureau of Reclamation (Reclamation) for using the C-BT Project for storing and delivering Windy Gap water.

A benefit to Subdistrict allottees is that allotment contract holders are granted total consumptive use of their Windy Gap water. Allottees can use and reuse Windy Gap water because it is imported water not native to the South Platte Basin. After first use within Subdistrict boundaries, participants may lease, transfer or sell the reuse or successive use rights for use within or outside Subdistrict boundaries.

Carriage Contract

The Subdistrict has a Carriage Contract with Reclamation and Northern Water specifying how Windy Gap water will be stored and carried to the East Slope through the C-BT Project using the unused capacity of the existing C-BT Project’s storage and conveyance facilities. Windy Gap’s largest annual operating expense is carriage charges, which is over 65 percent of the operating budget or $2.6 million.

In-lieu Deliveries

In abnormally dry years, no water may be legally available because other water users in the Colorado River hold water rights similar in priority to Subdistrict’s water rights. In abnormally wet years, storage space may not be available in Lake Granby. Pursuant to the Carriage Contract, the Subdistrict’s Integrated Operations Criterion, C-BT system water may be delivered by the Subdistrict in-lieu of Subdistrict water during times when water would not otherwise be available. In-lieu deliveries are subject to requirements, including replacement water to assure C-BT system beneficiaries are not injured as the result of in-lieu deliveries. The in-lieu service charge is $5.70 per acre-foot.

Longmont Mayor Ralph Price files for water rights

How the Windy Gap project came to be

WINDY GAP TIMELINE

Six CitiesCommittee formally created

MunicipalSubdistrict formed

Reclamation approves project and ground breaking ceremony

Windy Gap Projectdedicated and water deliveriesbegin

Establishment of the Windy Gap Firming ProjectWater Enterprise

Windy Gap Firming Project receives finalfederal permit

JULY 17 FEBRUARY 24 JULY 6 APRIL/NOVEMBER JUNE 29 NOVEMBER May 1967 1969 1970 1981 1985 1999 2017

Municipal Subdistrict, Northern Colorado Water Conservancy DistrictGeneral

4

Six Cities

Formal efforts to develop and construct the Windy Gap Project began in the summer of 1967 when Longmont Mayor Ralph Price filed for water rights on the Colorado River near Granby. Price was acting as trustee for a coalition of six Northern Colorado cities: Boulder, Estes Park, Fort Collins, Greeley, Longmont and Loveland.

A Geologic Cut Called Windy Gap

The Windy Gap Project they jointly pursued is located on the West Slope near a natural geologic cut called Windy Gap, just below the confluence of the Colorado and Fraser rivers. The cities envisioned Windy Gap as a water source to meet the future needs of the rapidly growing Northern Front Range.

After studying growth rates and water supply demand projections, the six cities chose to pursue the Windy Gap Project to meet their future municipal needs.

Municipal Subdistrict Formed

In 1969, the participants realized that the work and expertise needed to build the Windy Gap Project required a stronger organization than they could provide independently. The Subdistrict was formally established on July 6, 1970, with the same powers and legal standing as the parent Northern Water.

Following completion and approval of an Environmental Impact Statement and acquisition of 23 permits and licenses, Windy Gap Project construction began in July 1981. The Windy Gap Project was completed in 1985 and began delivering water to Subdistrict allottees in July.

Today, the Windy Gap Project consists of a diversion dam on the Colorado River that creates the 445 acre-foot Windy Gap Reservoir, a pumping plant and a six mile pipeline to Lake Granby.

Windy Gap Project Mitigation

The Subdistrict is required by the Water Conservancy Act to design, construct and operate the Windy Gap Project in a manner that will not impair the Colorado River Basin or increase costs to its water users. To satisfy this requirement, the Subdistrict provided mitigation measures and additional benefits to the West Slope. These included:

• $10.2 million payment to the Colorado River Water Conservation District used as seed money to construct Wolford Mountain Reservoir• $550,000 to the U.S. Fish and Wildlife Service for endangered fish species studies• $500,000 to upgrade and provide new pumps for rancher diversions downstream• $420,000 to Hot Sulphur Springs for upgrading water and wastewater treatment facilities

Windy Gap Firming Project

The Windy Gap Firming Project is being implemented to provide more reliable Windy Gap water deliveries. The Windy Gap Firming Project would include a 90,000 acre-foot reservoir at Chimney Hollow in the foothills west of Carter Lake. Not all of the owners of the Windy Gap Project are participating in the Windy Gap Firming Project. The City of Boulder and the Town of Estes Park own Subdistrict water units but are not participating in the Windy Gap Firming Project because they have other storage for Subdistrict water or other water supplies that currently meet their needs. The final federal permit needed to construct the Chimney Hollow Reservoir was signed on May 17, 2017.

Windy Gap Pump Plant construction in the early 1980’s. Snow covers a section of Windy Gap’s pipeline, which was trucked over the Continental Divide in sections.

Municipal Subdistrict, Northern Colorado Water Conservancy DistrictHistory

5

Participants Water Units Percentage

Platte River Power Authority 134 30.6%

Longmont 80 16.7

Broomfield 56 11.7

Greeley 52 10.8

Loveland 40 8.3

Boulder 37 7.7

Erie 20 4.2

Little Thompson Water District 17 3.5

Superior Metro District No. 1 15 3.1

Fort Lupton 13 0.6

Louisville 6 1.3

Lafayette 3 0.6

Estes Park 3 0.6

Berthoud 3 0.6

Central Weld County Water District 1 0.2

Windy Gap Participants

Municipal Subdistrict, Northern Colorado Water Conservancy DistrictService Area and Windy Gap Project Participants

Rawhide Power Plant(Platte River Power Authority)

Fort Collins

Greeley

Longmont

Fort Lupton

Denver

BoulderWindy Gap

Broomfield

Loveland

Central Weld CountyWater District

Left HandWater District

Estes Park

Erie

Superior Metropolitan District No. 1

Subdistrict Service AreaC-BT Project Facilities

LouisvilleLafayette

South Platte River

Little ThompsonWater District

Berthoud

6

Municipal Subdistrict, Northern Colorado Water Conservancy DistrictDistinguished Budget Presentation Award

7

Municipal Subdistrict, Northern Colorado Water Conservancy DistrictCommunity Profile of the Eight Largest Windy Gap Participants

Eight Largest Windy Gap Project Participants

City of Boulder

Established 1871Estimated Population for 2017 109,000Unemployment rate 2.5%Per Capita Income $63,707Land Area (square miles) 26Most Populous City in Colorado 11th

City of Longmont

Established 1871Estimated Population for 2017 94,777Unemployment Rate 2.6%Per Capita Income $63,707Land Area (square miles) 22Most Populous City in Colorado 14th

0

200,000

400,000

600,000

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

Population TrendsSix Largest Windy Gap Project Participants

Municipalities

City of Boulder Broomfield, City and County of

City of Greeley City of Longmont

City of Loveland Town of Erie

Source - Colorado Department of Local Affairs, State Demography Office, County website, Bureau of Labor Statistics, US Census - extrapolated from 2018 by US Census, County CAFR’s.

The Subdistrict has experienced a moderately growing population and service area in the past ten years.

8

City and County of Broomfield

Established 2001Estimated Population for 2017 68,552Unemployment Rate 2.5%Per Capita Income $73,129Land Area (square miles) 33.6Most Populous City in Colorado 16th

City of Greeley

Established 1870Estimated Population for 2017 104,557Unemployment Rate 2.8%Per Capita Income $50,483Land Area (square miles) 30Most Populous City in Colorado 13th

Municipal Subdistrict, Northern Colorado Water Conservancy DistrictCommunity Profile of Windy Gap Participants

Eight Largest Windy Gap Project Participants (continued)

0.0%2.0%4.0%6.0%8.0%

10.0%12.0%

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

Unemployment RateSix Largest Windy Gap Project Participants

Municipalities




Colorado


The Subdistrict’s service area is expected to remain strong as the Northern Colorado economy continues to experience solid job growth.

9



City of Loveland

Established 1881Estimated Population for 2017 75,655Unemployment Rate 2.5%Per Capita Income $47,117Land Area (square miles) 35.5Most Populous City in Colorado 15th

Town of Erie

Established 1874Estimated Population for 2017 26,250Unemployment rate 2.6%Per Capita Income $63,707Land Area (square miles) 19.8Most Populous City in Colorado 34th

$-

$20,000

$40,000

$60,000

$80,000

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

Per Capita IncomeSix Largest Windy Gap Participants

Municipalities





The income growth of the six largest municipal participants continues to be solid.

10


Source - Municipalities’ websites and most recent CAFR’s and Budget Reports

Platte River Power Authority

Established 1975

Colorado political subdivision established to provide wholesale generation and transmission to municipal utilities of its owner communities - Estes Park, Fort Collins, Longmont and Loveland.

Little Thompson Water District

Established 1960

Colorado special district established to provide high-quality drinking water to rural residents in a 300-square mile service area in Larimer, Weld and Boulder counties.


11

Municipal Subdistrict, Northern Colorado Water Conservancy DistrictLargest Employers

Largest Employers by County: 2018 - 2019 (Private Non-Retail)

Rank

123456789

10

Employer

UC Health: Poudre Valley HospitalBroadcom, Inc.Woodward, Inc.Banner Health: McKee Medical CenterHewlett PackardQualfonHach CompanyAnheuser-Busch Fort Collins BreweryTolmar, Inc.Otter Products Sum of largest employers Full labor force 2018

Employment

7,890 1,600 1,500 1,390 1,130 870 840 760 650 560 17,190 204,795

Larimer County

Rank

12

3456789

10

Employer

JBS USABanner Health: North Colorado Medical Center (NCMC)VestasState Farm Insurance CompaniesHalliburton Energy Services, Inc.TTEC (formerly Tele Tech)Anadarko PetroleumNoble EnergyLeprino FoodsSTARTEK, Inc. Sum of largest employers Full labor force 2018

Employment

4,590

3,560 2,270 1,200 1,030 620 520 500 480 470 15,240 164,680

Weld County

Boulder County Broomfield City and County

Rank

1234567

89

10

Employer

Medtronic PLCBoulder Community HealthIBM CorporationBall Aerospace & Technologies Corp.Good Samaritan Medical CenterSeagate TechnologyLongmont United & Avista Adventist HospitalsGoogleSierra Nevada CorporationKaiser Permanente Sum of largest employers Full labor force 2018

Employment

2,460 2,410 1,690 1,510 1,430 1,420

1,360 800 750 750 14,580 191,551

Rank

12345678

910

Employer

CenturyLinkOracleSCL Health Revenue Service CenterHunter Douglas Window FashionsVail ResortsTSYSDanone North AmericaBroadcom, Inc. (formerly Brocade Communications)VMwareBall Corporation Sum of largest employers Full labor force 2018

Employment

2,360 2,000 1,200 980 740 580 570

500 470 420 9,820 39,524

Source of largest employers: Development Research Partners/Metro Denver EDC/Revised May 2018Source of full labor force data: Colorado Department of Labor and Employment, Labor Market Information

Largest Employers Combined: Boulder, Broomfield, Larimer & Weld 2018 - 2019 (Private Non-Retail)

Top Ten Employers - Combined

Employment

7,890 4,590 3,560 2,460 2,410 2,360 2,270 2,000 1,690 1,600 30,830 600,550

County

Larimer Weld Weld Boulder Boulder Broomfield Weld Broomfield Boulder Larimer

Employer

UCHealth: Poudre Valley HospitalJBS USABanner Health: NCMCMedtronic PLCBoulder Community HealthCenturyLinkVestasOracleIBM CorporationBroadcom, Inc. Sum of largest employers Full labor force 2018

Rank

123456789

10

12

Municipal Subdistrict, Northern Colorado Water Conservancy DistrictPopulation and Jobs Trends

Larimer County

Year

20102015202020252030

Total Jobs

165,485 185,436 208,071 230,158 247,478

Population

300,543 326,803 356,900 388,866 418,814

0

5,000

10,000

15,000

20,000

25,000

30,000

35,000

2015 2020 2025 2030

Larimer CountyForecast Change in Population & Jobs 2015 - 2030

Source: State of Colorado Demography Office

Job Change Population Change

Weld County

Year

20102015202020252030

Total Jobs

104,463 132,084 155,574 174,333 192,823

Population

254,240 286,575 340,265 401,865 466,716

Denver Metro Including Boulder and Broomfield Counties

Year

20102015202020252030

Total Jobs

1,641,311 1,886,272 2,123,138 2,302,714 2,423,855

Population

2,797,873 3,053,801 3,306,177 3,540,403 3,758,347

0

10,000

20,000

30,000

40,000

50,000

60,000

70,000

2015 2020 2025 2030

Weld CountyForecast Change in Population & Jobs 2015 - 2030



0

50,000

100,000

150,000

200,000

250,000

300,000

2015 2020 2025 2030

Denver Metro Including Boulder and Broomfield CountiesForecast Change in Population & Jobs 2015 - 2030



13

Municipal Subdistrict, Northern Colorado Water Conservancy DistrictBoard of Directors

The 12-member Board is responsible for establishing policy and strategic direction. Directors from the eight counties within Northern Water boundaries are appointed to 4-year terms by District Court judges. Three Board seats are up for appointment every year. When a Director’s term expires, he or she continues to serve until the judge reappoints or replaces him or her. Subdistrict’s Board Officers are elected by the Board at its annual organizational meeting each October. The Board holds its public meetings twice a month. Directors are paid $100 per meeting to a maximum of $2,400 per year.

Past Presidents

William D. Farr Ray Joyce Les Williams

1970 - 1995 25 years1995 - 2000 5 years2000 - 2013 13 years

Dennis YanchunasPresidentBoulder CountyAugust 20, 2010 - Sept. 28, 2020

Bill FischerLarimer CountySept. 28, 2016 - Sept. 28, 2020

Mike ApplegateLarimer CountySept. 28, 1991 - Sept. 28, 2019

Bill EmslieVice PresidentLarimer CountySept. 28, 2005 - Sept. 28, 2021

Rob McClarySedgwick CountySept. 28, 2011 - Sept. 28, 2019

John RuschMorgan and Washington CountiesMay 10, 2002 - Sept. 28, 2021

Dale TrowbridgeWeld CountyAugust 15, 2014 - Sept. 28, 2019

Todd WilliamsBoulder CountySept. 28, 2017 - Sept. 28, 2021

Brad StrombergerLogan CountySept. 28, 2010 - Sept. 28, 2018

Don MagnusonWeld CountySept. 28, 2004 - Sept. 28, 2020

Sue Ellen HarrisonBoulder CountySept. 28, 2009 - Sept. 28, 2018

Kenton BrunnerWeld CountyMarch 14, 1994 - Sept. 28, 2018

Current Board of Directors

14

Municipal Subdistrict, Northern Colorado Water Conservancy DistrictBudget Process

The budget process provides an opportunity to align short-term objectives and actions at the program level to the Subdistrict’s long-term mission and values. The Board, General Manager and staff participate in the development of the budget.

The proposed budget for the upcoming year is presented to the Board for consideration and adoption in August of each year in order to align it with the adoption of water assessments which are also approved. The Board, at its regular meeting of May 10, 2018, appointed Bradley D. Wind, Jerry Gibbens, Karen Rademacher, Mary Krakow and John Budde as Budget Officers and directed them to prepare and submit the requisite budgets of the Subdistrict for fiscal year 2019. A notice is published, as required by law, in all the counties located wholly or partly within the Subdistrict boundaries stating the annual budget is available for inspection by the public, including the date and time for public hearing. This year’s budget review process included a workshop with the participants on July 10 and a Board workshop on July 20.

The 2019 budget was prepared utilizing the accrual method of accounting. This is the same basis of accounting used for the Subdistrict’s audited financial statements.

Budget ScheduleTask Jan Feb Mar Apr May June July Aug Sept

Formulate key goals and objectives

Identify major budget assumption

Budget instructions issued to all department managers

Review and final recommendations of budget by senior managers

Appointment of budget officers and prepare budget reports

Deliver budget to the Board

Hold public hearing and adopt budget by the Board

File budget with the state

Amending the Budget

Senior Management is authorized to add or revise budget amounts between operating expenses and projects. Any revisions that exceed the total appropriation for the fund, must be approved by the Subdistrict Board. All contracts over $35,000, whether budgeted or unbudgeted, must be authorized by the Subdistrict Board. Purchase of capital assets over $35,000, whether budgeted or unbudgeted must be authorized by the General Manager.

First Subdistrict Budget Resolution adopted in 1970

WHEREAS, the Municipal Subdistrict, Northern Colorado Water Conservancy District, was created on July 6, 1970, in the District Court Sitting in and for Weld County and is a political subdivision of the State of Colorado and a body corporate with all the powers of a public or municipal corporation; and

WHEREAS, E. F. Phipps, Secretary of Municipal Subdistrict,

Northern Colorado Water Conservancy District, and J. c. Nelson, Treasurer of said Subdistrict, were appointed by the Board of Directors to prepare the Budget for the fiscal year commencing November 1, 1970, and have submitted the same to the said Board and caused to be published the requisite Notice of Hearing.

NOW, THEREFORE, BE IT RESOLVED, that the Board of

Directors of the Municipal Subdistrict, Northern Colorado Water Conservancy District, hereby approves and adopts the Budget as submitted by the duly appointed Budget Officers and appropriates the aggregate sum of $33,925.00 for the purpose of paying the cost of all con-tractual obligations; meeting the expenses required to conserve,allocate, and control the water supplies of the Subdistrict includingthe expense of design, construction, administration, operation and maintenance of all works, facilities, properties, and functions necessary for the distribution and beneficial utilization of those water supplies; and the expenses for the transaction of all such other business functions and activities found by said Board to be necessary and convenient; and

BE IT FURTHER RESOLVED, that any revenue in excess of the sums appropriated_in this or any further appropriations for unforeseen contingencies shall be transferred to and deposited in the reserve account of said Subdistrict; and

BE IT FURTHER RESOLVED, that the funds r quired for the sums

so appropriated shall be provided in the manner and by the means adopted by the Board of Directors, Municipal Subdistrict, Northern Colorado Water Conservancy District.

The motion was seconded by Director Nix and upon being put to vote was unanimously adopted.

The Treasurer presented the Financial Statement for the month of August and explained that the budget officers had now been bonded; that funds had been deposited to the Subdistrict account in Westlake National Bank as shown on the Financial Statement; and that payment of the bills shown on the statement could now be made. Thereupon, Director Moffitt moved that the bills be allowed and checks and vouchers be drawn in payment thereof. The motion was seconded by Director Moore and upon being put to vote unanimously carried.

The bills approved for payment will be found in the financial records of

the Subdistrict on the Financial Statement dated August 31, 1970.

There being no further business to come before the Board, Director Moffitt moved adjournment to October 9, 1970.

Secretary

15

Municipal Subdistrict, Northern Colorado Water Conservancy DistrictFiscal Policies

Balanced Budget

The Subdistrict has not adopted a fiscal policy on a balanced budget. Subdistrict considers the budget to be balanced when the sources of funds equals the uses of funds. On occasion, the planned use of reserves, along with budgeted operating revenues are equal to or greater than budgeted expenditures.

Reserves

The Windy Gap Water Activity Enterprise Fund (Windy Gap) accumulates reserves sufficient to pay operation, maintenance, pumping energy, capital additions and working capital. These reserves may be drawn upon if unusual or unplanned events occur, or they may not be used at all. In the future, the Board will be reviewing and updating the types and amounts of the reserves.

The Windy Gap Fund practice is to maintain reserves that are sufficient to provide:

• 150 percent of expected operation and maintenance expenses• 100 percent of the energy costs to pump 35,000 acre-feet of water• Minimum of 360 unrestricted days cash on hand

Revenues

The Windy Gap Fund is fully funded through assessments for wholesale water provided by the Windy Gap Project.

Expenditures

The Subdistrict continues to find new ways to operate more efficiently while setting high standards in maintaining its facilities.

Risk Management

The Subdistrict is exposed to various risks of loss related to torts, (Colorado Governmental Immunity Act limits general liability to $387,000 per person and $1,093,000 per occurrence) theft of, damage to and destruction of assets; errors and omissions; and natural disasters. The Subdistrict carries commercial insurance for these risks. Settled claims resulting from these risks did not exceed commercial insurance coverage in any of the past three years.

Investments

The Board established an Investment Policy Statement (IPS) for funds not used to meet current liquidity requirements. The purpose of the IPS is to establish the investment restriction standards, investment objectives, delegation of authority, prudence, ethics and conflicts of interest, authorized securities and transactions, portfolio maturities and liquidity, safekeeping and custody, portfolio performance and reporting. The investment objectives in order of priority are safety, liquidity, return and diversification.

Capital Policy

Assets that have a service life of more than one year and have an initial cost of $5,000 or more are capitalized. Assets not meeting this criteria are expensed. Depreciation is computed using the straight-line method over the estimated useful life.

Basis Acccounting

The Subdistrict financial statements are prepared using the accrual basis of accounting with the economic resources measurement focus as prescribed by the Governmental Accounting Standard Board (GASB). Under this approach, all assets, deferred outflow of resources, liabilities and deferred inflow of resources are reported in the Statement of Net Position. Revenues are recorded when earned and expenses are recorded at the time liabilities are incurred.

Capital Contributions

Capital contributions consist of payments from participants for the funding of the Windy Gap Firming Project. Also, payments received for the Colorado River Connectivity Channel (Connectivity Channel) are accounted for as contributions. In the Statement of Revenues, Expenses and Changes in Net Position, capital contributions are recognized after nonoperating revenues (expenses).

16

Municipal Subdistrict, Northern Colorado Water Conservancy DistrictSubdistrict Organizational Chart

General Public of the Subdistrict

Service Area

Legal CounselWindy Gap and Windy Gap Firming Project ParticipantsCommittee

The Subdistrict has no full-timeemployees. All administrative, engineering and operations and maintenance functions are provided through an agreement with Northern Water. The Subdistrictreimburses Northern Water for thecosts of providing these services.

Board Committees• Audit• Finance and Bene�ts• Legal and Legislative

12-MemberBoard of Directors

17

The Subdistrict is comprised of three enterprise funds that use activities of the organization to track financial performance and budgetary oversight of its business-like operations. The two major enterprise funds, Windy Gap Water Activity and Windy Gap Firming Project Water Activity, account for the wholesale water operations of the Subdistrict. The other fund, Municipal Subdistrict District Fund, is the owner of the two water activity enterprise funds. For financial reporting purposes, the Municipal Subdistrict District Fund is included in the Windy Gap Water Activity Enterprise Fund statements. The two water activity enterprise funds are legally distinct and financially independent funds. Both have been established in accordance with Colorado Statutes, as “enterprises” and are excluded from the application of Article X, Section 20, of the Colorado Constitution.

Windy Gap Water Activity Enterprise Fund Overview

Windy Gap is self-supporting through water assessments. The purpose of Windy Gap is to account for the wholesale water activities of the Windy Gap Project which provides water supplies to northern Colorado municipalities, rural domestic suppliers and industry. The Windy Gap Project consists of a diversion dam on the Colorado River, a pump station and a pipeline to pump and transport diverted Windy Gap Project water to the C-BT Project for storage and distribution to the fifteen participants. Construction of the $81.7 million Windy Gap Project commenced in July 1981 with operation commencing in July 1985. The fiscal year 2019 operating and capital budget totals $6,422,724. This represents a decrease of $22,008 or .36 percent from the fiscal year 2018 budget. The decrease is primarily due to reduced costs related to the Connectivity Channel. Total revenues of $5,890,745 represents a decrease of $529,630 from the 2018 budget. The decrease was related to lower contributions for the Connectivity Channel. The budget includes a contingency appropriation of $250,000 that can be used with Senior Management authorization for the expenditures that could not be forseen at the time the budget was prepared.

Beginning Cash and Reserves

$21,328,641

Sources ofFunds

$5,890,745

Uses ofFunds

$6,422,724

Ending Cash andReserves

$20,796,662

Fiscal Year 2019 Budget

Municipal Subdistrict, Northern Colorado Water Conservancy DistrictBudget Appropriations

Fiscal Year 2019Total Funds

$129,069,557

Municipal SubdistrictDistrict Fund

$100,050

Windy Gap Water ActivityEnterprise Fund

$6,422,724

Windy Gap Firming ProjectWater Activity Enterprise Fund

$122,546,783

Budget Appropriations by Fund

5%

94%

1%

Windy Gap Fund

Windy Gap Firming Fund

Municipal Subdistrict District Fund

18

Municipal Subdistrict, Northern Colorado Water Conservancy DistrictAdopted BudgetFiscal Year 2019

Windy Gap Water Activity Enterprise Fund Overview (continued)

Comparison of Sources and Uses by Fiscal Year

Beginning Cash and Reserves Unrestricted

Total

SOURCES OF FUNDS Revenue Sources Operating Revenues Water Assessments Total operating revenues

Other Revenues Earnings on Investments Other Nonoperating Revenue Total other revenues

Contributions Connectivity Channel Total contributions

Total Sources Funds to Reserves Total Funds Available

USES OF FUNDS Operating Expenses Carriage Delivery Pumping Energy & Wheeling Pump Station & Pipeline Reservoir and Dam Programs Total Operating Expenses

Capital Projects Total Projects

Total Expenditures

Contingency Appropriation

Total Uses

Ending Cash and Reserves Unrestricted Total

Total funds accounted for

Fiscal Year2017 Actual

$ 20,910,645

20,910,645

2,959,905 2,959,905

129,556 43,820 173,376

30,000 30,000

3,163,281 ( 27,175 ) $ 24,046,751

1,238,595

479,885 5,931 889,619 2,614,030

383,231 383,231

2,997,261

2,997,261

21,049,490 21,049,490

$ 24,046,751

Fiscal Year2018 Budget

$ 21,866,047

21,866,047

5,152,525 5,152,525

116,550 57,000 173,550

1,094,300 1,094,300

6,420,375

$ 28,286,422

2,584,525 840,000 513,528 11,855 1,086,144 5,036,052

1,158,680 1,158,680

6,194,732

250,000

6,444,732

21,841,690 21,841,690

$ 28,286,422

Fiscal Year2018 Estimated

Actual

$ 21,049,490 21,049,490

3,572,525 3,572,525

152,000 58,000 210,000

340,000 340,000

4,122,525

$ 25,172,015

1,684,525 160,000 515,921 11,855 1,066,693 3,438,994

404,380 404,380

3,843,374

3,843,374

21,328,641 21,328,641

$ 25,172,015


$ 21,328,641

21,328,641

5,152,525 5,152,525

172,120 26,100 198,220

540,000 540,000

5,890,745

$ 27,219,386

2,584,525 840,000 561,227 14,564 1,264,083 5,264,399

908,325 908,325

6,172,724

250,000

6,422,724

20,796,662 20,796,662

$ 27,219,386

PercentageChange from


47.68% ( 54.21% ) 14.21%

( 50.65% ) ( 50.65% )

( 8.25% )

9.29% 22.85% 16.38% 4.53%

( 21.61% ) ( 21.61% )

( .36% )

( .36% )

Dollar ChangeFrom


$

55,570 ( 30,900 ) 24,670

( 554,300 ) ( 554,300 )

( 529,630 )

47,699 2,709 177,939 228,347

( 250,355 ) ( 250,355 )

( 22,008 )

( $ 22,008 )

19



Revenues

Total revenues are expected to be $5,890,745 which is a decrease of $529,630 or 8.25 percent from the prior year budget. Revenue from wholesale water assessments are estimated to be the same as the fiscal year 2018 budget. Water assessments are estimated on deliveries of 25,000 acre-feet in fiscal year 2019. Pumping energy and wheeling charges associated with pumping at the Windy Gap Pump Plant are projected to be $28.00 per acre-foot on 30,000 acre-feet. For fiscal year 2019, the charge for the assessment deferral will be $36 per acre-foot of ownership in the Windy Gap Project. Other projected revenues for fiscal year 2019 include contributions for the Connectivity Channel of $540,000, interest earnings of $172,120 and other income of $26,100. With no outstanding debt, no charges for debt service are included in water assessments beginning in 2017.

A summary of total revenues is provided in the chart below:

$5,152,525

$540,000

$172,120 $26,100

Water Assessments

Windy Gap Connectivity Channel

Earnings on Investments

Other Nonoperating Revenue

Water Assessments

The three revenue components of the annual water assessments are provided in the charts below:

Water AssessmentsConnectivity Channel ContributionsEarnings on InvestmentsOther Nonoperating Revenues

Total revenues

Budget

$ 5,152,525

540,000 172,120

26,100

$ 5,890,745

Percent ofTotal Sources

of Funds

87%

9 3

1

100%

50%

34%

16%

Carriage Delivery

Assessment Deferral

Pumping Energy and Wheeling

Carriage DeliveryAssessment DeferralPumping Energy and Wheeling

Total water assessments

Budget

$ 2,584,525 1,728,000

840,000

$ 5,152,525

Percent ofTotal Water

Assessments

50% 34

16

100%

$-

$2

$4

$6

$8

$10

$12

$14

$16

2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019

Mill

ions

Windy GapAnnual Assessments Revenues

Actual Estimate Budget

13,046 AF

No Debt Service Charges

20



Revenues

Carriage Delivery Assessment

Water delivery assessment is the charge to use the C-BT Project storage system and conveyance to transport Windy Gap Project water from the West Slope of Colorado across the Continental Divide to the East Slope. For fiscal year 2019, the charge is projected to be $100 per acre-foot (same as fiscal year 2018) of water delivered. In addition, the fixed carriage charge is $176.09 per ownership unit of Windy Gap Project water. The water delivery assessment is calculated on the costs of providing the service and on total water carried through the C-BT Project Adams Tunnel. When less water is carried through the tunnel, Windy Gap Project water becomes a larger percent of the total, resulting in higher water delivery cost. In 2015, the water carried through the Adams Tunnel was 113,856 acre-feet, the lowest since the Windy Gap Project began delivering water. This was the driver of higher delivery assessments. A summary of carriage delivery charges is provided in the table and charts below:

$-

$50

$100

$150

$200

2010 2011 2012 2013 2014 2015 2016 2017

Windy GapCarriage Delivery per Acre-Foot

Carriage Costs per Acre-Foot

Assessment Deferral

The assessment deferral is used to support all program costs and to maintain and operate the pump station, reservoir and dam, and stream gauging stations. For fiscal year 2019, the charge is $3,600 per ownership unit of Windy Gap Project water, no change since fiscal year 2014. This assessment is due whether or not the participant takes delivery of water. A summary of assessment deferral charges is provided in the table and chart below:

Fiscal Year 2019

Assessment Deferral

Per unit

$ 3,600

Per Acre-foot

$ 36

Total

$ 1,728,000

$2,700

$2,800

$2,900

$3,000

$3,100

$3,200

$3,300

$3,400

$3,500

$3,600

$3,700

2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

No Increase

Windy Gap per Unit Assessment

0

50,000

100,000

150,000

200,000

250,000

300,000

350,000

0

5,000

10,000

15,000

20,000

25,000

2009 2010 2011 2012 2013 2014 2015 2016 2017

Water through Adams Tunnel LowestSince Operating Windy Gap

Windy Gap and Adams Tunnel Deliveriesper Acre-Foot

Windy Gap Water Delivered Adams Tunnel

Fiscal Year 2019

Carriage DeliveryFixed Annual Carriage

Acre-Feet

25,000

Charge PerAcre-FootPer Unit

$ 100.00 176.09

Total

$ 2,500,000 84,525 $ 2,584,525

Beginning in fiscal year 2020, an additional charge of $34 per acre-foot (1.79% annual increase) will be assessed to the carriage delivery fee per the carriage contract signed in 2014. Also, the fixed annual carriage charge will no longer be assessed beginning in fiscal year 2020.

21


Windy Gap Water Activity Enterprise Fund (continued)

Revenues

Pumping Energy/Wheeling

Energy and wheeling assessement is for pumping Windy Gap Project water from the Windy Gap Reservoir on the Colorado River through a six-mile pipeline to Lake Granby. For fiscal year 2019, the charge is projected to be $28.00 per acre-foot of water delivered. Energy costs are calculated based on a tiered pricing structure with three pricing tiers. Tier 3 is the most expensive tier and starts when water pumped is in excess of approximately 32,000 acre-feet. Water was pumped in 2018, the first time since 2013, as water storage space was available in Lake Granby. During the times when Windy Gap water is not available, C-BT system water is delivered by the Subdistrict in-lieu of Subdistrict water. The in-lieu water deliveries must provide replacement water or can be met by certain C-BT system spill conditions. Also, Windy Gap Project water was spilled in 2011 and 2014 to make space for C-BT system water. A summary of pumping energy/wheeling charges and tiered pricing structure is provided in the tables and charts below:

Windy Gap Pump Plant

Fiscal Year 2019

Pumping Energy/ Wheeling

Acre-Feet

30,000

Charge PerAcre-FootPer Unit

$ 28.00

Total

$ 840,000

$-

$10

$20

$30

$40

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

Energy Cost per Acre-Foot

0

10,000

20,000

30,000

40,000

50,000

2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

Windy GapWater Pumped per Acre-Foot

Tier

1 Energy Price2 Energy Price3 Energy Price

Rate ($/kWH)

0.03047 0.04624 0.08406

22



Expenses

The fiscal year 2019 Windy Gap budgeted expenses are $6,422,724. The fiscal year 2019 budget represents a decrease of $22,008 or .36 percent from the fiscal year 2018 budget of $6,444,732. Operating and maintenance expenditures total $4,000,316, a $50,408 increase from the 2018 budget. Program expenses are projected to be $1,264,083, increasing $177,939. Capital additions total $908,325, a decrease of $250,355. The contingency of $250,000 is unchanged from the 2018 budget. Material and services expenses are projected to increase by $348,244 or 17 percent primarily related to increased costs in water quality. The Subdistrict has no full-time staff and all personnel services are provided by Northern Water. The Subdistrict reimburses Northern Water for the actual time incurred doing Windy Gap activities. Labor reimbursement costs are estimated to increase by $184,048 or 27.6 percent compared to fiscal year 2018. The increase related primarily to engineering resources for the Connectivity Channel project.

A summary of the total expenditures is provided in the chart below:

Operating and Maintenance-$3,949,908

Programs-$1,086,144

Capital Expenditures-$1,158,680

Contingency-$250,000

Carriage DeliveryMaterials and ServicesPumping Energy and WheelingLaborContingency

Total Major Expenses

40%

33%

13%

10%

4%

Carriage Delivery

Materials and Services

Pumping Energy and Wheeling

Labor

Contingency

Percent ofTotal Usesof Funds

40% 30 13 7 4

100%


$ 2,584,525 1,898,433 840,000 849,766 250,000

$ 6,422,724

A summary of total expenditures by major expense categories is provided in the charts below:

0

2,000

4,000

6,000

8,000

10,000

12,000

2014 Actual 2015 Actual 2016 Actual 2017 Actual 2018 Projection 2019 Budget

Signed Final ROD (Final Permit) May 2017

Windy Gap EnterpriseLabor Hours Trend

Windy Gap Enterprise Windy Gap Firming Enterprise

Connectivity Channel

$540 $560 $580 $600 $620 $640 $660 $680 $700 $720 $740

2014 2015 2016 2017

Thou

sand

s

Windy Gap EnterpriseActual Labor Costs

2014 2015 2016 2017

A summary of labor costs and hours is provided in the charts below:

23



Operating and Maintenance

Business Plan Priority - collect and deliver water

Carriage expenses for the use of the C-BT conveyance and storage system to deliver Windy Gap water are expected to be the same compared to fiscal year 2019 budget.

Carriage delivery and pumping energy and wheeling are operating expenses driven by volume of water pumped and delivered. Energy and wheeling costs for pumping 30,000 acre-feet of water are projected to be $840,000, no change from 2018 budget. Costs to maintain the pump plant and pipeline are expected to increase $47,699 mainly due to planned scada upgrades.

A summary of the operating and maintenance expenses (62.3 percent of the total uses of funds) is provided in the table and chart below:

Carriage DeliveryPumping Energy and WheelingPump Station and PipelineReservoir and Dam

Total operating and maintenance expenses

Budget

$ 2,584,525 840,000 561,227 14,564

$ 4,000,316

$0

$1

$2

$3

$4

2011 2012 2013 2014 2015 2016 2017

Mill

ions

Windy Gap EnterpriseActual Operating and Maintenance

Actual Operating and Maintenance

A summary of carriage delivery costs and pumping energy and wheeling costs is provided in the charts below:

$-

$0.5

$1.0

$1.5

$2.0

$2.5

2009 2010 2011 2012 2013 2014 2015 2016 2017

Mill

ions

Windy Gap EnterpriseCarriage Delivery Costs

Pumping Energy and Wheeling Costs

Carriage Delivery Costs Pumping Energy and Wheeling Costs

$-

$500

$1,000

$1,500

$2,000

2009 2010 2011 2012 2013 2014 2015 2016 2017

Thou

sand

s

Windy Gap EnterpriseCarriage Delivery Costs by Entity

Reclamation Northern Water

A summary of pump station, pipeline and reservoir and dams expenses is provided in the charts below:

$0

$5,000

$10,000

$15,000

$20,000

$25,000

2014Actual

2015Actual

2016Actual

2017Actual

2018Estimate

2019Budget

Windy Gap EnterpriseReservoir and Dam Expenses

$-

$100,000

$200,000

$300,000

$400,000

$500,000

$600,000

$700,000

2014Actual

2015Actual

2016Actual

2017Actual

2018Estimate

2019Budget

Windy Gap EnterprisePump Station and Pipeline Expenses

24



Expenses

Programs

Programs expenses (19.7 percent of the total uses of funds) include primarily outside services and labor. Five additional tables are provided to show detail for Senior Management, Information Technology, Financial Services, Water Quality and Water Resources programs expense.

A summary of programs expenses is provided in the chart and table below:

Senior ManagementWater Quality Financial ServicesCommunicationsWater ResourcesInformation TechnologyContracts Allotments and InclusionsWater Records and AccountingForest HealthField ServicesWater ConservationReal EstateGeneral EngineeringEmergency and SecurityProject ManagementFacilities

Total Program expenses

Budget

$ 487,764 315,683 129,884 78,898 63,992 59,922 56,573 15,893 8,018 5,278 5,000 4,157 1,457 425 139 31,000

$ 1,264,083

$ 885,608 378,475

$ 1,264,083

Expenses by Category

Non Labor Labor

Total

Percent ofTotal Program

Expenses

38.6% 25.0 10.3 6.2 5.1 4.7 4.5 1.3 0.6 0.4 0.4 0.3 0.1 0.0 0.0 2.5

100.0%

$-

$200,000

$400,000

$600,000

$800,000

$1,000,000

$1,200,000

$1,400,000

$1,600,000

2014 Actual 2015 Actual 2016 Actual 2017 Actual 2018 Estimate 2019 Budget

Windy GapEight Largest Programs Expenses

Communications Financial Services Contracts Allotments and Inclusions

Facilities Information Technology Senior Management

Water Quality Water Resources Total for Programs

25



Expenses, Programs

Senior Management Program

Business Plan Priority - cultivate operational and organizational excellence and maintain and strengthen relationships

Senior Management program expenses are for general oversight of all Subdistrict activities including water rights, water planning, and policies, rules and procedures. In addition to legal, insurance and Board of Director expenses, costs related to participation in various regional and state-wide cooperative water programs including recovery and stream management and river basin studies are included in the Senior Management program. Also, other Senior Management expenses are charged to many individual projects and activities that are managed and budgeted by program managers.

A summary of Senior Management program expenses is provided in the table below:

Expenditures by Program and Category

Senior ManagementFiscal Year

2017 ActualFiscal Year

2018 Budget


ActualFiscal Year

2019 Budget

DollarChange From


Percentage Change From


Expenditures:Program SummaryGeneral Programs $129,452 $396,868 $136,468 $112,153 -$284,715 -71.74%

Colorado River Wild and Scenic 39,854 75,194 76,194 43,097 -32,097 -42.69% Colorado River Stream Management Plan 7,676 13,216 9,216 21,403 8,187 61.95% Colorado River Front Range Council 14,730 10,732 10,732 21,106 10,374 96.66%Colorado Water Congress 2,481 17,775 17,775 13,000 -4,775 -26.86%Colorado River Fire Studies 19,697 17,573 17,573 12,612 -4,961 -28.23%Insurance 4,303 4,500 7,000 8,000 3,500 77.78%Legal Matters 121,765 135,418 100,418 98,599 -36,819 -27.19%Board of Directors 70,348 50,022 51,522 54,744 4,722 9.44%Travel and Training 3,086 6,068 6,068 3,000 -3,068 -50.56%

Total $413,393 $727,366 $432,966 $387,714 -$339,652 -46.70%

Summary by CategoryLabor $101,818 $87,266 $87,266 $86,314 -$952 -1.09%Non Labor 311,575 640,100 345,700 301,400 -338,700 -52.91%Total $413,393 $727,366 $432,966 $387,714 -$339,652 -46.70%

26



Expenses, Programs

Water Quality Program

Business Plan Priority - protect and conserve water supplies

Water Quality expenses are primarily for the Windy Gap portion of expenses incurred for baseline monitoring of streams and reservoirs and water quality studies including a NEPA study in 2019. Baseline monitoring program objectives are to monitor nutrients, metals, general chemistry, phytoplankton and zooplankton depending on the location. The program tracks long and short term water quality changes in receiving streams, upstream and downstream of where the C-BT Project and Project water is released.

A summary of Water Quality program expenses is provided in the table below:


Water QualityFiscal Year


2018 Budget


ActualFiscal Year

2019 Budget

DollarChange From




Expenditures:Program SummaryWater Quality Programs $43,814 $47,506 $47,506 $67,317 $19,811 41.70%Baseline Monitoring 88,910 82,212 82,212 129,676 47,464 57.73%Water Quality Studies 11,174 12,218 12,218 90,000 77,782 636.62%Watershed Groups 7,300 7,300 18,418 11,118 152.30%Regulations 5,544 3,310 3,310 --Travel and Training 397 2,500 2,500 6,962 4,462 178.48%

Total $149,840 $151,736 $151,736 $315,683 $163,947 108.05%

Summary by CategoryLabor $74,422 $45,236 $45,236 $81,440 $36,204 80.03%Non Labor 75,419 106,500 106,500 234,243 127,743 119.95%Total $149,840 $151,736 $151,736 $315,683 $163,947 108.05%

27



Expenses, Programs

Financial Services Program

Business Plan Priority - cultivate operational and organizational excellence

The Financial Services program provides financial services including fund accounting, preparation of the Comprehensive Annual Financial Report, cash disbursements, fixed asset reporting, cash management, accounts receivable and financial planning for the annual budget and ad hoc financial analyses for special projects. Expenses include costs for the annual independent audit and cash managment services as well as labor charges for services provided by Northern Water for accounting and budgeting services described herein.

A summary of Financial Services program expenses is provided in the table below:


Financial ServicesFiscal Year


2018 Budget


ActualFiscal Year

2019 Budget

DollarChange From




Expenditures:Program SummaryAccounting Services $60,938 $65,509 $65,359 $67,303 $1,794 2.74%Purchasing 176 188 188 -188 -100.00%

Treasury 19,136 25,891 25,490 26,946 1,055 4.07% Budget 34,328 18,927 18,927 35,635 16,708 88.28%

Total $114,578 $110,515 $109,964 $129,884 $19,369 17.53%


28



Expenses, Programs

Communications Program

Business Plan Priority - maintain and strengthen relationships

The Communications program provides internal and external communications and public outreach for the Municipal Subdistrict. Major functions and responsibilities include: facility tours and public speaking activities; coordinating, editing and writing all web, social media and printed materials; developing, coordinating and maintaining displays, maps and photos; and drafting Board and committee meeting minutes.

In fiscal year 2019, the Communications program plans to update the Windy Gap informational brochure including associated graphics and videos in support of its continued effort to expand outreach formats to tell the public about the Subdistrict through stories, activities and projects.

A summary of Communications program expenses is provided in the table below:


Communications Fiscal Year


2018 Budget


ActualFiscal Year

2019 Budget

DollarChange From




Expenditures:Program SummaryCommunications Programs $12,264 $26,783 $24,783 $73,254 $46,471 173.51%Communications Tours 7,434 5,000 5,000 5,644 644 12.88%

Total $19,698 $31,783 $29,783 $78,898 $47,115 148.24%


29



Expenses, Programs

Water Resources Program

Business Plan Priority - protect and conserve water supplies

The Water Resources program performs engineering activities that support the Subdistrict with specific water rights investigations, operations modeling, river basin modeling, water availability studies, water supply quantifications and stream flow forecasting. Water Resources expenses for streamflow forecasting include the cost of forecast software as well as charges for USGS flow gaging. Budgeted expense for climate change is for outside consultant engineering work.

A summary of Water Resources program expenses is provided in the table below:


Water ResourcesFiscal Year


2018 Budget


ActualFiscal Year

2019 Budget

DollarChange From




Expenditures:Program SummaryWater Resources General $2,500 $3,025 $3,025 $3,504 $479 15.83%Stream Flow Forecast 16,810 28,020 28,020 29,918 1,898 6.77%Climate Change 10,000 20,000 20,000 20,000 0 0.00%Riverware System Model 12,305 13,341 13,341 1,635 -11,706 -87.74%CBT Project Operations 1,286 1,748 1,748 2,649 901 51.54%Water Rights 3,774 5,412 5,412 860 -4,552 -84.11%Travel and Training 2,617 5,426 5,426 #DIV/0!

Total $49,291 $71,546 $71,546 $63,992 -$7,554 -10.56%

Summary by CategoryLabor $21,517 $22,218 $22,218 $14,664 -$7,554 -34.00%Non Labor 27,774 49,328 49,328 49,328 0.00%Total $49,291 $71,546 $71,546 $63,992 -$7,554 -10.56%

30



Expenses, Programs

Information Technology Program


The Information Technology program provides technical resources for network infrastructure, software maintenance, data management and client services in support of Subdistrict activities. Infrastructure support provides design, maintenance and troubleshooting of the network and other IT infrastructure including computers, switches, firewalls and connections to outside communication entities. Client support services provides a broad range of services including help desk calls, audio visual support and workstation management. Information Technology expenses are primarily incurred by Northern Water and charged to the Subdistrict.

A summary of Information Technology program expenses is provided in the table below:


Information Technology Fiscal Year


2018 Budget


ActualFiscal Year

2019 Budget

DollarChange From




Expenditures:Program SummaryIT Support Services $50,379 $55,000 $55,000 $55,000 $0 0.00%

Geographic Information System 3,176 3,976 3,976 1,550 -2,426 -61.02%Travel and Training 8,034 4,072 4,072 3,372 -700 -17.19%

Total $61,588 $63,048 $63,048 $59,922 -$3,126 -4.96%

Summary by CategoryLabor $11,209 $8,048 $8,048 $4,922 -$3,126 -38.84%Non Labor 50,379 55,000 55,000 55,000 0 0.00%Total $61,588 $63,048 $63,048 $59,922 -$3,126 -4.96%

31



Expenses, Programs

Contracts, Allotments and Inclusions Program


The Contracts, Allotments and Inclusions program provides administrative services to assure that all lands receiving Windy Gap water are within the boundaries of the Subdistrict. All petitions for inclusion are reviewed and processed and submitted to the Board of Directors for approval before being submitted to the U.S. Bureau of Reclamation for Secretarial Assent. Once Secretarial Assent is received, all documentation is sent to legal counsel to prepare a motion to District Court for Order including lands into Subdistrict boundaries. In addition, any changes or transfers of allotment contracts for 480 acre-feet units are processed through the Contracts, Allotments and Inclusions program.

A summary of Contracts, Allotments and Inclusions program expenses is provided in the tables below:


Contracts Allotments and Inclusions




ActualFiscal Year

2019 Budget

DollarChange From




Expenditures:Program SummaryAllotments $2,264 $2,000 $3,500 $3,500 --Inclusions 48,311 34,084 59,584 53,073 18,989 55.71%

Total $50,575 $34,084 $61,584 $56,573 $22,489 65.98%


32



Debt Service Expenditures

At this time, Windy Gap has no noncurrent liabilities. All outstanding indebtedness incurred for the construction of the Windy Gap Project was fully defeased in 2016. There are no future Windy Gap capital projects planned that will be funded by capital financing. The Subdistrict does not have a specific debt limit dollar amount threshold.

Capital Projects

Connectivity ChannelPipeline Electromagnetic TestFuels Treatment and Wildfire RiskBuilding Security Upgrade

Total


$ 540,000 250,000 103,325 15,000

$ 908,325

TotalCost Estimate(1)

$ 15,000,000

(1) If no amount is shown, the Fiscal Year 2019 budget amount represents the total project cost estimate.

Colorado River Connectivity Channel Project $540,000

Part of the 1041 permit conditions for Windy Gap Firming Project, the Windy Gap Reservoir Modification Study preferred alternative was the Connectivity Channel. The Connectivity Channel Project is a modification to the existing Windy Gap dam as necessary to bypass flows through and/or around the Windy Gap Reservoir. The focus for 2019 will be applying for the needed permits. The project contributions will be from Windy Gap Firming Project and several other organizations. The project is still waiting full funding.

Cost sharing on projects to improve forest health and protect infrastructure from wildfire risks.

The Subdistrict initiated a condition assessment on the Windy Gap pipeline in 1999. Initial testing indicated that the prestressing wire in the pipeline may be damaged. The Subdistrict has replaced two sections of damaged pipe and repaired several other. The Subdistrict continues non-destructive testing of the pipeline and the next planned interval is in 2019.

Fuels Treatment and Wildfire Risk $103,325

Pipeline Electromagnetic Test $250,000

Building Security Upgrade $15,000

Upgrade cameras, card access and other security components.

Net Cash Flows from (use) OperationsNet Cash Produced

Beginning Net PositionEnding Net Position


Actual

$ 343,531 343,531

37,775,056 $ 38,118,587


$ 86,346 86,346

38,118,587 $ 38,204,933

Projected Net Position - Windy Gap

The projected net position below is for fiscal years 2018 and 2019. Net position is the residual of all other financial statement elements presented in a statement of net position.


( $ 1,890,828 ) ( 1,890,828 )

39,665,884 $ 37,775,056

33


Windy Gap Firming Project Water Activity Enterprise Fund Overview


PercentageChange From


6,854.67% 50.00%

6,836.57%

129.36% ( 100.00% ) ( 100.00% ) 38,660.00% 383.32% N/A

1,034.49%

Beginning Cash

SOURCES OF FUNDS Contributions and Bond Proceeds Interest and Rental Income

Total Sources

Balance sheet source

Total funds available

USES OF FUNDS Capital Planning Permits Design Land and Improvements Construction Mitigation and Enhancements Proprty Management

Total Uses

Ending cash

Total funds accounted for

Fiscal Year 2017Actual

$ 12,605,460

10,534,897

10,534,897

1,919,957

$ 25,060,314

$ 8,593 351,780 8,622,916 1,007,570 3,297,923 647,021

13,935,803

11,124,511

$ 25,060,314

Fiscal year 2018 Budget

$ 6,564,751

7,500,000 20,000

7,520,000

$ 14,084,751

$ - 218,000 6,247,000 1,500,000 283,000 2,553,889 -

10,801,889

3,282,862

$ 14,084,751

Fiscal year2018 Estimated

Actual

$ 11,124,511

9,032,793 20,000

9,052,793

$ 20,177,304

$ - 360,000 11,097,230 375,000 2,692,763 1,435,165 35,600

15,995,758

4,181,546

$ 20,177,304

Fiscal year 2019 Budget

$ 4,181,546

521,600,000 30,000

521,630,000

$ 525,811,546

$ - 500,000 109,690,383 12,343,450 12,950

122,546,783

403,264,763

$ 525,811,546

Dollar ChangeFrom

Fiscal Year 2018Budget

$

514,100,000 10,000

514,110,000

282,000 ( 6,247,000 ) ( 1,500,000 ) 109,407,383 9,789,561 12,950

$ 111,744,894

Beginning Cash

$4,181,546

Sources ofFunds

$521,630,000

Uses ofFunds

$122,546,783

Ending Cash

$403,264,763

34


Windy Gap Firming Project Water Activity Enterprise Fund Overview (continued)

Business Plan Priority - plan and implement new water supplies

The Windy Gap Firming Project Water Activity Enterprise Fund is self-supporting through participants’ contributions. The Subdistrict has undertaken the Windy Gap Firming Project to increase the reliable firm yield of the exisiting Windy Gap Project. The annual delivery of Windy Gap Project water is not reliable in years of low spring runoffs, due to the Windy Gap Project’s junior water rights, and conversely, during some wet periods, storage space in Granby Reservoir is not available for Windy Gap Project water. In 1999, a group of the Windy Gap Project participants working through the Subdistrict, initiated the proposed Windy Gap Firming Project to complement the Windy Gap Project by firming a portion of their Windy Gap Project water units. The Windy Gap Firming Project participants include the Platte River Power Authority, Central Weld County Water District, Little Thompson Water District and the municipalities of Broomfield, Fort Lupton, Greeley, Lafayette, Longmont, Louisville, Loveland, Superior and Erie.

The specific purpose of the Windy Gap Firming Project is to increase the firm yield to approximately 30,000 acre-feet of water from the existing Windy Gap Project. Additional reliability and yield will be achieved by constructing a new 90,000 acre-foot reservoir, the Chimney Hollow Reservoir, located southwest of Loveland and just west of Carter Reservoir, dedicated to store Windy Gap Project water. Firm water deliveries from the Windy Gap Project are needed to meet a portion of the existing and future demands of the Windy Gap Firming Project partcipants and ultimately the existing and future demands the end users served within the boundaries of the Subdistrict.

The permitting process for the Windy Gap Firming Project began in 2003 and has included a 1041 permit which was received from Grand County in 2012, and an official Record of Decision (ROD) that was received from the U.S. Bureau of Reclamation in 2014, approving construction and operation of the Chimney Hollow Reservoir and a physical connection of the Chimney Hollow Reservoir and appurtenant facilities to the C-BT Project facilities. The Colorado Department of Public Health and Environment issued its 401 water quality certification for the Windy Gap Firming Project on March 25, 2016. Also, the State of Colorado officially endorsed the Windy Gap Firming Project and Chimney Hollow Reservoir on April 12, 2016. The final ROD and federal 404 Clean Water Act (CWA) permit from the U.S. Army Corps of Engineers was signed on May 17, 2017. This 404 CWA permit is the final federal requirement needed to construct Chimney Hollow Reservoir. Detailed design of the Windy Gap Firming Project facilities is expected to be complete in early 2019, followed by 41 months of construction and is expected to be operational in 2023. The estimated cost of the reservoir and appurtenant facilities is approximately $521.6 million.

The fiscal year 2019 Windy Gap Firming Project budget totals $122.5 million. This represents an increase of $111.7 million from the fiscal year 2018 budget. The increase is due to the planned construction of Chimney Hollow Reservoir.

$-

$100

$200

$300

$400

$500

$600

$-

$2

$4

$6

$8

$10

$12

$14

$16

2012 2013 2014 2015 2016 2017 2018 2019

Mill

ions

Mill

ions

Windy Gap Firming EnterpriseContributions

Actual Projected

$-

$50

$100

$150

$200

2012 2013 2014 2015 2016 2017 2018 2019

Mill

ions

Windy Gap Firming EnterpriseConstruction in Process

Actual Estimate

A summary of construction in progress costs and contributions are provided in the charts below:

35

Municipal Subdistrict, Northern Colorado Water Conservancy DistrictWindy Gap Firming Project

Hansen Feeder Canalto Horsetooth Reservoir

Saint Vrain Supply Canal to Lyons

SouthernWater SupplyPipeline

Flatiron Penstocks

PowerPlant

Access Road

Bald Mountain Tunnelfrom Pinewood Reservoir Chimney Hollow

Inlet Pipe

SpillwayChannel

Dam

Dam

Dam

Dam

DamDam

Inlet/Outlet Tunnel

ChimneyHollow Reservoir

CarterLakeReservoir

FlatironReservoir

Proposed Chimney Hollow

Facilities

Flatiron/CarterPressure Tunnel

Spillway Canal& Stilling Basin18E

18E

31

31

8E

C-BT Project Existing FacilitiesChimney Hollow PipelineSpillway ChannelInlet/Outlet TunnelSpillway CanalProposed Dams

Legend

Northern Colorado Water Conservancy DistrictMunicipal Subdistrict

36


Windy Gap Firming Project Proposed Financing Structure

The anticipated plan for financing consists of a Senior/Subordinate structure in which the Windy Gap Firming Water Activity Enterprise will issue Senior Lien Revenue Bonds (Senior Bonds) and will also enter into a Subordinate Lien Loan (Subordinate Loan) from the Colorado Water Conservation Board (CWCB). The amount of the Subordinate Loan will be up to $90 million. Section 12 of House Bill 17-1248 authorized the CWCB to make the Subordinate Loan for the Windy Gap Firming Project. The Governor signed the bill on May 23, 2017. Final approval of the Subordinate Loan by CWCB was November 15, 2017.

The Senior Bonds are anticipated to be a fixed-rate bond issuance of approximately $194 to $374 million. The proceeds of the Senior Bonds along with the Subordinate Loan, when combined with other funds provided by the Windy Gap Firming Project participants, will be used to pay the costs associated with the construction and completion of the Windy Gap Firming Project. It is expected that the Senior Bonds will close by the end of 2019.

Projected Net Position - Windy Gap Firming

The projected net position below is for fiscal years 2018 and 2019. Net position is the residual of all other financial statement elements presented in a Statement of Net Position.

ContributionsNet Cash Produced

Beginning Net PositionEnding Net Position


$ 10,534,897 10,534,897

33,161,451 $ 43,696,348


Actual

$ 9,052,793 9,052,793

43,696,348 $ 52,749,141


$ 521,600,000 521,600,000

52,749,141 $ 574,349,141

The significant increase in net position is the result of receiving contributions with no operation and maintenance expense. This fund has no operations at this time and will start when the Chimney Hollow Reservoir is completed.

Percent ofTotal Usesof Funds

89.51% 10.07 0.47 0.01

100%

89.51%

10.07%

0.41% 0.01%

Construction

Mitigation andEnhancements

Permits

Property Management

ConstructionMitigation and EnhancementsPermitsProperty Management

Total

Budget

$ 109,690,383

12,343,450 500,000 12,950

$ 122,546,783

Windy Gap Firming Project Water Activity Enterprise Fund Overview (continued)

Capital Expenditures

A summary of the expenses is provided in the table and charts below:

37

Municipal Subdistrict, Northern Colorado Water Conservancy DistrictWindy Gap Firming Project Participants

N

C-BT Delivery System

Northern Water Boundaries

CARTERLAKE

HORSETOOTHRESERVOIR

RAWHIDEEnergy Station

FLATIRONRESERVOIR

BOULDERRESERVOIR

South Platte Rive

r 2

4 5

12

3

119

18

Cache la Poudre River

6

7

10

Participants Storage Volume

(acre-foot) Percent1 Broomfield 26,464 29.40%

2 PRPA Service Area 16,000 17.78%

4 Loveland 9,587 10.65%

5 Greeley 9,189 10.21%

3 Longmont 8,000 8.89%

6 Erie 6,000 6.67%

7 Little Thompson Water District 4,850 5.39%

8 Superior 4,726 5.25%

9 Louisville 2,835 3.15%

10 Fort Lupton 1,103 1.23%

11 Lafayette 900 1.00%

12 Central Weld County Water District 346 0.38%90,000 100%

38


Municipal Subdistrict District Fund Overview

The Municipal Subdistrict District Fund, in accordance with Colorado statutes, is the owner of the Windy Gap Water Activity Enterprise Fund and the Windy Gap Firming Project Water Activity Enterprise Fund.


PercentageChange From


Beginning cash

SOURCES OF FUNDS

Revenues Contributions Earnings on Investments

Total Sources

Total Funds Available

USES OF FUNDS

Expenses Board of Directors

Total Uses

Ending Cash

Total Funds Accounted For

Board Expenses FICA Legal fees Directors’ fees Travel/lodging/meals/data Bonds

Total


$ 15,374

69,500 2

69,502

$ 84,876

$ 68,836

68,836

16,040

$ 84,876

$ 1,889 22,910 24,700 19,237 100

$ 68,836


$ 17,173

100,050 2

100,052

$ 117,225

100,050

100,050

17,175

$ 117,225

$ 2,200 37,950 28,800 25,500 5,600

$ 100,050

Fiscal year2018 Estimated

Actual

$ 16,040

78,600 2

78,602

$ 94,642

$ 79,480

79,480

15,162 $ 94,642

$ 2,200 24,880 28,800 23,500 100

$ 79,480


$ 15,162

100,050 2

100,052

$ 115,214

100,050

100,050

15,164

$ 115,214

$ 2,200 37,950 28,800 25,500 5,600

$ 100,050

Dollar ChangeFrom

Fiscal Year 2018 Budget

39

Municipal Subdistrict, Northern Colorado Water Conservancy DistrictAcronyms

AFAcre-foot or Acre-feet

CAFRComprehensive Annual Financial Report

C-BTColorado-Big Thompson Project

CIPCapital Improvement Plan

COEU.S. Army Corps of Engineers

COPsCertificates of Participation

CWCBColorado Water Conservation Board

CRSColorado Revised Statutes

CWAClean Water Act

DEISDraft Environmental Impact Statement

DOLADepartment of Local Affairs (Colorado)

EAMEnterprise Asset Management

EISEnvironmental Impact Statement

EPAEnviromental Protection Agency

FEMAFederal Emergency Management Agency

FTEFull time equivalent

FONSIFinding of no significant impact

GAAPGenerally Accepted Accounting Principles

GASBGovernmental Accounting Standards Board

GISGeographic Information System

40

Municipal Subdistrict, Northern Colorado Water Conservancy DistrictAcronyms

IPSInvestment Policy Statement

NEPANational Environmental Policy Act

NORTHERN WATERNorthern Colorado Water Conservancy District

NRCSNatural Resource Conservation Service

NWRANational Water Resource Association

RODRecord of Decision

ROWRight of Way

SUBDISTRICTMunicipal Subdistrict, Northern Colorado Water Conservancy District

TABORTaxpayers Bill of Rights, revenue and tax limit amendment. See Amendment 1 (glossary).

TIFTaxing Increment Finance District

41

Municipal Subdistrict, Northern Colorado Water Conservancy DistrictGlossary

Accounting StandardsSubdistrict’s financial statements are prepared in accordance with principles generally accepted in the United States of America (GAAP). Additionally, the Subdistrict applies all applicable pronouncements of the Governmental Accounting Standards Board.

Acre-foot or Acre-feetVolume of water equal to one foot in depth covering an area of one acre, or 43,560 cubic feet; approximately 325,851 gallons. One acre-foot is roughly the amount needed to serve 2.5 families each year.

Adopted BudgetThe budget adopted by the Board of Directors at the August Planning and Action meeting. The adopted budget becomes effective annually as of October 1, and appropriations lapse at fiscal year end (September 30).

AllocationsDistribution of costs.

Amendment 1Approved by the electorate in the November 1992 election, this amendment is known as the Taxpayers Bill of Rights (TABOR). This is a revenue and expenditure limiting amendment to the Colorado constitution. The limit is determined by whichever is more restrictive to the growth of government.

AppropriationLegal authorization granted by the Board to make expenditures as specified in the appropriating resolution.

AssetsEconomic resources owned by the Subdistrict.

AuditA systematic collection of sufficient, competent evidential matter needed to attest to the fairness of management’s assertions in the financial statements.

Basis of AccountingThe Subdistrict’s financial statements are accounted for on the flow of economic resources measurement focus, using the accrual basis of accounting. Under this method, all assets and liabilities associated with operations are included on the statement of net assets, revenues and are recorded when earned, and expenses are recorded at the time liabilities are incurred. This is different from the basis of budgeting.

BoardIn the Subdistrict, this is a 12-member group of appointed officials.

BudgetA financial plan for a specif

municipal subdistrict - northern water...fulfill the subdistrict’s mission: “to provide water...

Documents