ITEM:		CONSENT CALENDAR
3.	RECEIVE AND FILE THIRD QUARTER FINANCIAL ACTIVITY REPORT FOR FISCAL YEAR 2023-2024
Meeting Date:			May 20, 2024	Budgeted:	N/A
From:			David J. Stoldt,	Program/	N/A
			General Manager	Line Item No.:
Prepared By:			Nishil Bali	Cost Estimate:	N/A
General Counsel Review: N/A
Committee Recommendation: The Finance and Administration Committee reviewed this item on May 13, 2024 and recommended approval.
CEQA Compliance: This action does not constitute a project as defined by the California Environmental Quality Act Guidelines Section 15378.

SUMMARY: The third quarter of Fiscal Year (FY) 2023-2024 concluded on March 31, 2024. Tables comparing budgeted and actual year-to-date revenues and expenditures for the period are included as Exhibit 3-A. Exhibits 3-B and 3-C present the same information in bar graph format. The following comments summarize District staff's observations:

REVENUES

The revenue table compares amounts received through the third quarter of FY 2023-2024 to prorated amounts budgeted for that same time period. Total revenues collected were $20,044,449 or 64.4% of the year-to-date (YTD) budgeted amount of $31,104,938. Variances within the individual revenue categories are described below compared to the YTD budget.

• Potential revenues for the Water Supply Charge are $1,859,306 for the period. These have been placed in a reserve pending the results of the retrial lawsuit.
• Property tax revenues were $1,503,617, or 77.1% of the budget for the period. The first installment of this revenue was received in December 2023. The second installment has been received in April 2024 and will be reflected in the year-end report.
• User fee revenues were $4,667,046, or about 103.7% of the amount budgeted.
• Pure Water Monterey Water Sales revenue was $9,917,331 or 99.6% of the budget for the period. This is water sales revenue for water purchased from Monterey One Water and sold to California American Water and is a pass-through to the District.
• Connection Charge revenues were $762,646, or 203.4% of the budget for the period. Actual collections were higher than the anticipated budgeted figure due to the fees from three large projects that include the Sand City Marriott hotel, the Ascent Housing Project, and the Laguna Seca Villas project at Seaside.
• Permit Fees revenues were $117,899, or 18.6% of the revised budget (119% of the originally adopted budget for the period). Actual collections for Permit fees and connection charges are anticipated to track the revised budget due to additional fees related to new projects.
• Interest revenues were $316,289, or 281.1% of the budget for the period. Actual interest was higher than budgeted due to higher interest rate revenue from the District’s investment portfolio.
• Reimbursements were $645,240 or 63.6% of the YTD budget based on actual spending and collection of reimbursement project funds. Actuals are lower due to pending reimbursements from Aquifer Recovery & Storage (ASR) operations and Cal-am conservation rebates, pending the adoption of their rate case.
• Grant revenue was $188,195, or 2.3% of the budget. This is due to grant-funded projects being deferred and continued to subsequent quarters. The District is expecting reimbursements of at least $1,266,044 for this fiscal year that will be recorded as funds are received.
• The Other revenue category totaled $6,879 or about 61.1% of the budgeted amount. This category includes insurance refunds, miscellaneous reimbursements, and other miscellaneous services. Actual collections were higher than anticipated.
• The Reserves category includes potential use of reserves during the fiscal year for which adjustments will be made at the end of the fiscal year.

EXPENDITURES

Expenditure activity as depicted in the expenditure table is similar to patterns seen in past fiscal years. Total expenditure of $16,691,157 was about 53.7% of the budgeted amount of $31,104,938 for the period. Variances within the individual expenditure categories are described below:

• Personnel costs of $3,442,274 were about 97.0% of the revised budget. This is tracking the YTD budget for the fiscal year.
• Expenditures for supplies and services were $1,317,451 or about 93.8% of the budgeted amount. This was lower than the anticipated budget due to expenses for consulting services being lower than anticipated.
• Fixed assets purchases of $80,701 represented around 43.7% of the budgeted amount. This was due to some of the fixed asset purchases being deferred to the next year.
• Funds spent for project expenditures were $9,991,426, or approximately 43.7% of the amount budgeted for the period. This is lower than budgeted due to deferred project spending for larger projects such as Pure Water Monterey Expansion and Integrated Resource Water Management (IRWM). This line also includes water purchased from Monterey One Water which is tracking expected budget.
• The contingency budget has not been spent so far.
• There are no Reserve expenditures in the first three quarters of the fiscal year. Reserve adjustments will be made at the conclusion of the fiscal year.

EXHIBITS

3-A Revenue and Expenditure Table

3-B Revenue Graph

3-C Expenditure Graph

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