ITEM:

DISCUSSION ITEM

 

18.

REVIEW PROPOSED FISCAL YEAR 2016-2017 MPWMD BUDGET  AND RESOLUTION 2016-10

 

Meeting Date:
May 16, 2016

Budgeted: 

N/A

 

From:

David J. Stoldt,

Program/

N/A

 

General Manager

Line Item No.:

 

Prepared By:

Suresh Prasad

Cost Estimate:

N/A

 

General Counsel Review:  N/A

Committee Recommendation:  N/A

CEQA Compliance:  N/A

 

SUMMARY:  The proposed budget for Fiscal Year (FY) 2016-2017 is attached as Exhibit 18-C (separate document).  While preparing the proposed budget, District staff was mindful of the continued economic conditions as well as the current status of the District’s three main funding sources (Mitigation Program revenue, Property Tax Revenue, and Water Supply Charge).  This budget assumes continuation of the adopted annual Water Supply Charge and continued collection of the Mitigation Program revenue from ratepayers of California American Water in FY 2016-2017.  This budget does not include collection of user fee revenue from California American Water ratepayers.  This budget also takes into account District’s existing Rabobank ASR loan debt obligation.  Proposed expenditures and revenues each total $11,810,100, which is a decrease of 12% for expenditures and revenues from the amount budgeted in FY 2015-2016.  A more detailed justification of the proposed budget is provided in the transmittal letter which is part of the budget document.  This proposed budget does not include the use of reserves to balance the proposed budget.  The FY 2016-2017 Budget also assumes payment of $230,000 towards debt service (interest and principal) for the Rabobank ASR Loan.  The budget document has been presented in same format as in prior years. 

 

RECOMMENDATION:  Staff recommends that the Board discuss the proposed FY 2016-2017 budget and give general direction to staff to prepare the final budget document for adoption at the June 20th Board Meeting.  No formal action is required at this meeting.

 

BACKGROUND:  After compilation of the original requests from all Divisions, a detailed review and several adjustments by Division Managers and the General Manager, culminated this budget with proposed expenditures and revenues for FY 2016-2017 totaling $11,810,000, of which $2,721,600 or 23% includes reimbursement funds from grants, California American Water and other agencies.

 

In the past, District budgets had been balanced by use of previously accumulated reserves.  At the District’s strategic planning session on September 29, 2004, staff recommended that a balanced budget be prepared for FY 2005-2006 using a combination of revenue and expenditure adjustments to eliminate the use of reserve funds.  At the January 19, 2005 budget workshop, the Board adopted an eight-part strategy for balancing the FY 2005-2006 Budget.  In being mindful of the 2005 Board adopted strategy, every effort was made to balance this proposed budget without the use of reserves.  This proposed FY 2016-2017 Budget was balanced without the use of reserves to maintain all of District’s programs and services.  This budget assumes the continued collection of the annual Water Supply Charge and California American Water Mitigation Program revenues.  This budget does not include user fee revenue.

 

EXHIBITS

18-A    Draft Resolution No. 2016-10

18-B    Draft Copy Certification

18-C    Draft Fiscal Year 2016-2017 Proposed Budget (separate document)

 

 

U:\staff\Boardpacket\2016\20160516\DiscussionItems\18\Item-18.docx