REGULAR BOARD MEETING Closed Session Begins at 4:00 PM February 13, :30 PM Greenspot Road, Highland, CA AGENDA

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1 REGULAR BOARD MEETING Closed Session Begins at 4:00 PM February 13, :30 PM Greenspot Road, Highland, CA AGENDA "In order to comply with legal requirements for posting of agenda, only those items filed with the District Clerk by 12:00 p.m. on Wednesday prior to the following Wednesday meeting not requiring departmental investigation, will be considered by the Board of Directors". CALL TO ORDER ROLL CALL OF BOARD MEMBERS PUBLIC COMMENTS Any person wishing to speak to the Board of Directors is asked to complete a Speaker Card and submit it to the District Clerk prior to the start of the meeting. Each speaker is limited to three (3) minutes, unless waived by the Chairman of the Board. Under the State of California Brown Act, the Board of Directors is prohibited from discussing or taking action on any item not listed on the posted agenda. The matter will automatically be referred to staff for an appropriate response or action and may appear on the agenda at a future meeting. AGENDA - This agenda contains a brief general description of each item to be considered. Except as otherwise provided by law, no action shall be taken on any item not appearing on the following agenda unless the Board of Directors makes a determination that an emergency exists or that a need to take immediate action on the item came to the attention of the District subsequent to the posting of the agenda. 1. Approval of Agenda RECESS INTO CLOSED SESSION CLOSED SESSION 2. CONFERENCE WITH LEGAL COUNSEL - ANTICIPATED LITIGATION

2 Significant exposure to litigation pursuant to Government Code Section (d) (2) One Potential Case 5:30 PM RECONVENE MEETING PLEDGE OF ALLEGIANCE ROLL CALL OF BOARD MEMBERS ANNOUNCEMENT OF CLOSED SESSION ACTIONS ITEMS PUBLIC COMMENTS 3. APPROVAL OF CONSENT CALENDAR All matters listed under the Consent Calendar are considered by the Board of Directors to be routine and will be enacted in one motion. There will be no discussion of these items prior to the time the board considers the motion unless members of the board, the administrative staff, or the public request specific items to be discussed and/or removed from the Consent Calendar. a. Approve January 9, 2019 regular board meeting minutes b. Approve Directors' fees and expenses for January 2019 DISCUSSION AND POSSIBLE ACTION ITEMS 4. Consider Regional Recycled Water Pipeline Design Reimbursement Agreement with San Bernardino Valley Municipal Water District 5. Consider Authorization of the Purchase and Sale Agreement for the Sterling Property with the City of San Bernardino 6. Consider Adoption of Five-Year Work Plan 7. Consider Approval of Fiscal Year Mid-Year Budget Revisions REPORTS 8. Board of Directors' Reports 9. General Manager/CEO Report 10. Legal Counsel Report 11. Board of Directors' Comments ADJOURN PLEASE NOTE: Materials related to an item on this agenda submitted to the Board after distribution of the agenda packet are available for public inspection in the District's office located at Greenspot Rd., Highland, during

3 normal business hours. Also, such documents are available on the District's website at subject to staff's ability to post the documents before the meeting. Pursuant to Government Code Section (a), any request for a disability-related modification or accommodation, including auxiliary aids or services, that is sought in order to participate in the aboveagendized public meeting should be directed to the District Clerk at (909) at least 72 hours prior to said meeting.

4 Draft pending approval EAST VALLEY WATER DISTRICT January 9, 2019 REGULAR BOARD MEETING MINUTES The Chairman of the Board called the meeting to order at 5:30 p.m. Director Goodrich led the flag salute. PRESENT: ABSENT: STAFF: LEGAL COUNSEL: GUEST(s): Directors: Carrillo, Coats, Goodrich, Morales, Smith Director: None John Mura, General Manager/CEO; Brian Tompkins, Chief Financial Officer; Jeff Noelte, Director of Engineering and Operations; Justine Hendricksen, District Clerk; Shayla Gerber, Senior Administrative Assistant Jean Cihigoyenetche Members of the public PUBLIC COMMENTS Chairman Carrillo declared the public participation section of the meeting open at 5:30 p.m. There being no written or verbal comments, the public participation section was closed. Legal Counsel announced that Pursuant to Government Code Section (b)(2), that the Board requested that the following item be added to the agenda after unanimously determining that there was a need to take immediate action on the item, which came to the Districts attention after the agenda was posted: Consider Resolution Non-CalPERS Employees Insurance Coverage under Public Employees Medical and Hospital Act. M/S/C (Coats-Goodrich) to place Resolution as an action item on the January 9, 2019 agenda. APPROVAL OF AGENDA M/S/C (Coats-Goodrich) that the January 9, 2019 agenda be approved as amended. 1 Minutes 1/09/2019 smg

5 DIRECTORS FEES AND EXPENSES FOR DECEMBER 2018 M/S/C (Coats-Goodrich) that the Board approve the Directors fees and expenses for December 2018 as submitted. ADOPT 2019 IRS MILEAGE RATE M/S/C (Coats-Goodrich) that the Board adopt the standard mileage reimbursement rate of 58 cents per mile as established by the IRS for RESOLUTION NON-CALPERS EMPLOYEES INSURANCE COVERAGE UNDER PUBLIC EMPLOYEES MEDICAL AND HOSPITAL ACT The Human Resources/Safety Risk Manager provided information regarding the District s need to take immediate action to adopt Resolution ; upon contacting CalPERS to inquire why a director was not showing health insurance coverage effective January 1 st after enrolling during the open enrollment period, CalPERS informed staff that the District did not have a resolution on file to cover non-pers employees under the Public Employees Medical and Hospital Care Act (PEMHCA). The Human Resources/Safety Risk Manager stated that per PERS, in order to cover non- CalPERS pension members such as directors, an agency s Board of Directors must approve and submit a resolution to the CalPERS Board of Administration; an approval of this resolution will ensure compliance with the PEMHCA and will allow the District to add a non-member category for health enrollment onto its PERS system. M/S/C (Morales-Coats) that the Board adopt Resolution electing to be subject to the Public Employees Medical and Hospital Care Act at an equal amount for employees and annuitants non-pers all employees TOP INLAND EMPIRE WORKPLACES PROGRAM The Human Resources/Safety Risk Manager announced that East Valley Water District received an honorable mention in the Press-Enterprises Top Workplace in the Inland Empire small employer category. She provided a presentation detailing the criteria used by the Press-Enterprise in determining top workplaces; reviewed surveys taken by employees, average scores and how the District ranked compared to the local government benchmarks, employee comments, and areas for improvement. Information only. STERLING NATURAL RESOURCE CENTER PROJECT UPDATE The Director of Strategic Services provided a Sterling Natural Resource Center (SNRC) construction progress update; she stated that soil is being exported to the Redlands landfill and concrete is expected to be poured next week; and a time lapse camera was 2 Minutes 1/09/2019 smg

6 installed on the treatment side today and is expected to be available for viewing on the District s website early next week. Information only. BOARD OF DIRECTORS REPORTS Director Goodrich reported on the following: January 2 he attended the San Bernardino City Council meeting where they discussed the Settlement Agreement; and January 4 he toured the Sterling Natural Resource Center site with the General Manager/CEO. Director Morales reported on the following: January 8 he attended the San Bernardino Board of Water Commissioners meeting. Director Coats reported on the following: December 18 he attended the San Bernardino Valley Municipal Water District Board meeting; December 20 and January 8 he met with the General Manager/CEO where they discussed District business; and January 8 he attended San Bernardino Valley Municipal Water District Board meeting. Vice Chairman Smith reported on the following: January 2 he attended the San Bernardino City Council meeting; and January 3 he toured the Sterling Natural Resource Center site with the General Manager/CEO. Chairman Carrillo reported on the following: January 3 he met with the General Manager/CEO to review the agenda; January 4 toured the Sterling Natural Resource Center site with the General Manager; and January 8 he attended the Highland City Council meeting. Information only. GENERAL MANAGER/CEO REPORT The General Manager/CEO wished everyone a happy new year and announced that District operations went smoothly during the closure. He reported that the Community Advisory Commission met yesterday where they discussed the District s 5-year work plan; and January 10 he will be providing a historical briefing of the Sterling Natural Resource Center for newly elected Valley District Board members. The General Manager/CEO informed the Board of upcoming meetings and events: January 9:00 a.m. CHEF Committee meeting January 21 District closed due to observance of Martin Luther King Jr. holiday January 5:30 p.m. Special Board meeting Information only. 3 Minutes 1/09/2019 smg

7 LEGAL COUNSEL REPORT No report at this time. BOARD OF DIRECTORS COMMENTS Director Coats stated that he is looking forward to the new year. Chairman Carrillo wished everyone a happy new year and stated that he is looking forward to the future. Information only. ADJOURN The meeting adjourned at 6:18 p.m. John Mura, Secretary Chris Carrillo, Board President 4 Minutes 1/09/2019 smg

8 To: From: Governing Board Members General Manager/CEO BOARD AGENDA STAFF REPORT Agenda Item #3.b. Meeting Date: February 13, 2019 Consent Item Subject: Approve Directors' fees and expenses for January 2019 RECOMMENDATION: Approve the Governing Board Members fees and expenses for January BACKGROUND / ANALYSIS: The Board has instructed staff to list all director fees and expenses as a separate agenda item to show full fiscal transparency. Only after Board review and approval will the compensation and expenses be paid. AGENCY GOALS AND OBJECTIVES: Goal and Objectives II - Maintain a Commitment to Sustainability, Transparency, and Accountability a) Practice Transparent and Accountable Fiscal Management REVIEW BY OTHERS: This agenda items has been reviewed by the Administration department. FISCAL IMPACT The fiscal impact associated with this agenda item is $7, which is included in the current fiscal budget. Recommended by: John Mura General Manager/CEO Respectfully submitted: Justine Hendricksen District Clerk

9 ATTACHMENTS: Description Directors' Expense Reports January 2019 Type Backup Material

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28 To: From: Governing Board Members General Manager/CEO BOARD AGENDA STAFF REPORT Agenda Item #4. Meeting Date: February 13, 2019 Discussion Item Subject: Consider Regional Recycled Water Pipeline Design Reimbursement Agreement with San Bernardino Valley Municipal Water District RECOMMENDATION: Staff recommends that the Board of Directors authorize the General Manager to execute the Regional Recycled Water Pipeline Design Reimbursement Agreement with the San Bernardino Valley Municipal Water District (Valley District). BACKGROUND / ANALYSIS: The Sterling Natural Resource Center (SNRC) project will include an effluent discharge pipeline to transport recycled water to the Redlands Basins and City Creek for groundwater recharge. Exhibit A is a map that shows this pipeline. The SNRC discharge pipeline is an integral part of regional recycled water infrastructure that can be used to convey recycled water from SNRC and recycled water produced by other projects like the Clean Water Factory, a project proposed by the City of San Bernardino. The regional nature of the SNRC discharge pipeline created the opportunity to partner with Valley District since they have historically been responsible for the construction of regional infrastructure for conveying local and imported water supplies. On January 15, 2019, Valley District approved the subject agreement (attached as Exhibit B) in which Valley District shall reimburse East Valley Water District (EVWD) for all actual fully burdened costs of design of the Regional Recycled Water Pipeline, including geotechnical work. The current estimated cost for this design work is $453,125. Once design is complete, a separate agreement will be developed on reimbursement of construction costs, including an existing segment of 2,735 linear feet of 36-inch ductile iron pipeline previously constructed by EVW D. Title to the Regional Recycled Water Pipeline shall vest with Valley District upon completion of construction. In addition, Valley District intends to contract with EVWD to operate, maintain and repair the pipeline. AGENCY GOALS AND OBJECTIVES: Goal and Objectives I - Implement Effective Solutions Through Visionary Leadership

29 a) Identify Opportunities to Optimize Natural Resources Goal and Objectives II - Maintain a Commitment to Sustainability, Transparency, and Accountability c) Pursue Alternative Funding Sources Goal and Objectives IV - Promote Planning, Maintenance and Preservation of District Resources a) Develop Projects and Programs to Ensure Safe and Reliable Services REVIEW BY OTHERS: This agenda item has been reviewed by the executive management team. FISCAL IMPACT This Regional Recycled Water Pipeline Design Reimbursement Agreement will fund the design of the Regional Recycled Water Pipeline. Recommended by: John Mura General Manager/CEO ATTACHMENTS: Description Exhibit A Map Exhibit B - Agreement Respectfully submitted: Jeff Noelte Director of Engineering and Operations Type Backup Material Backup Material

30 9TH ST Exhibit A - Regional Recycled Water Pipeline Map SNRC Site 6TH ST HIGHLAND 5TH ST po City Creek Spreading I1:24,000 SAN BERNARDINO ALABAMA ST }þ 210 Redlands Basins REDLANDS SAN BERNARDINO AVE Legend Re-Purposed Existing Pipeline Future Recycled Water Pipeline Y:\2018\1800_SNRC\ExhibitA.mxd

31 EXHIBIT "B" Execution Copy January 16, 2019 REGIONAL RECYCLED WATER PIPELINE REIMBURSEMENT AGREEMENT This Reimbursement Agreement for the Regional Recycled Water Pipeline is entered into and effective as of, 2019, by and between EAST VALLEY WATER DISTRICT, a County Water District, organized and operating pursuant to California Water Code Section et seq. (EVWD) and SAN BERNARDINO VALLEY MUNICIPAL WATER DISTRICT, a Municipal Water District, organized and operating pursuant to California Water Code Section et seq. (VALLEY DISTRICT) (Collectively Parties ). RECITALS WHEREAS, since 1969 VALLEY DISTRICT, together with a number of other public agencies including EVWD, have worked cooperatively to replenish the San Bernardino Basin Area (SBBA) and ensure that there are reliable sources of water for the residents of the San Bernardino Valley, among others; and WHEREAS, VALLEY DISTRICT and EVWD have collaborated on the Sterling Natural Resource Center project (SNRC) which will be designed and constructed by EVWD and which includes a 10 million gallons per day (mgd) effluent discharge pipeline, (Discharge Line) which will transport recycled water to the Redlands Basins and City Creek for discharge; and WHEREAS, VALLEY DISTRICT envisions that the SNRC Discharge Line is an integral part of regional recycled water infrastructure, including, but not limited to, combining recycled water flows from the SNRC and the Clean Water Factory, a project proposed by the city of San Bernardino, which would require expanding the Discharge Line and increasing its capacity to 15 mgd to accommodate the combined flows; and WHEREAS, VALLEY DISTRICT has historically been responsible for the construction of regional infrastructure for conveying local and imported water supplies; and WHEREAS, VALLEY DISTRICT wishes to reimburse EVWD for all expenses incurred in the design, including geotechnical work, of the Regional Recycled Water Pipeline; NOW THEREFORE, the Parties agree as follows: 1. Design and Construction. AGREEMENT EVWD will design the Regional Recycled Water Pipeline as a component of the SNRC project at an expanded capacity of 15 MGD to accommodate recycled water flows from the Regional Recycled Water Pipeline Reimbursement Agreement January 16, 2019 Page 1 of

32 Execution Copy January 16, 2019 Clean Water Factory pursuant to VALLEY DISTRICT s request. A diagram depicting the Regional Recycled Water Pipeline is attached hereto as Exhibit A for reference. The current concept of the Regional Recycled Water Pipeline will be comprised of newly constructed pipeline tied into an existing 2,735 linear feet of 36-inch diameter ductile iron pipe originally constructed to serve EVWD Plant 150, but never used (Plant 150 Pipeline) and other associated appurtenances. 2. Reimbursement. VALLEY DISTRICT shall reimburse EVWD for all actual fully burdened costs of design of the Regional Recycled Water Pipeline, including geotechnical work. The current estimated cost of the design of the Regional Recycled Water Pipeline is $453, Review and Approval. Upon completion of the design, VALLEY DISTRICT shall have the opportunity to review and approve the design plans of the Regional Recycled Water Pipeline, which approval shall not be unreasonably withheld. 4. Payments. VALLEY DISTRICT shall make progress payments, monthly in arrears, based on monthly invoices prepared by EVWD and supported by appropriate and sufficient documentation of cost. VALLEY DISTRICT shall have 10 days to review and pay the invoices. Upon completion of the design, EVWD shall submit a final invoice to VALLEY DISTRICT representing the total actual cost of design of the Regional Recycled Water Pipeline less payments previously made by VALLEY DISTRICT. VALLEY DISTRICT shall have 30 days within which to pay the final invoice. 5. Construction, Title & Operation. The Parties intend to enter into a separate agreement for construction of the Regional Recycled Water Pipeline and reimbursement of costs of construction and the existing but repurposed 2,735 linear feet of 36-inch ductile iron pipeline. Title to the Regional Recycled Water Pipeline shall vest with VALLEY DISTRICT upon completion of construction as evidenced through a Notice of Completion filed by EVWD. In addition, the Parties intend to enter into a separate agreement through which VALLEY DISTRICT may contract with EVWD to operate, maintain and repair the Regional Recycled Water Pipeline under direction from VALLEY DISTRICT. VALLEY DISTRICT shall have full and complete discretion to determine whether recycled water shall be discharged to City Creek or to the Redlands Basins except when Regional Recycled Water Pipeline Reimbursement Agreement January 16, 2019 Page 2 of

33 Execution Copy January 16, 2019 the point of discharge is defined under the terms and conditions of the SNRC Final Environmental Impact Report (SCH _). VALLEY DISTRICT shall cause the Regional Recycled Water Pipeline to be operated by EVWD in full compliance with all applicable laws and regulations. 6. Indemnification. (a) EVWD Indemnity. EVWD shall indemnify VALLEY DISTRICT against and agrees to hold VALLEY DISTRICT harmless of and from all liabilities, obligations, actions, suits, proceedings or claims, and all costs and expenses, including but not limited to, reasonable attorney s fees (collectively, Claims and Costs), based upon or arising out of any negligent or intentional breach or failure of EVWD to observe or perform any obligation of EVWD as set forth in this Agreement. (b) VALLEY DISTRICT Indemnity. VALLEY DISTRICT shall indemnify EVWD against and agrees to hold VALLEY DISTRICT harmless of and from all liabilities, obligations, actions, suits, proceedings or claims, and all costs and expenses, including, but not limited to, reasonable attorney s fees (collectively, Claims and Costs), based upon or arising out of any negligent or intentional breach or failure of VALLEY DISTRICT to observe or perform any of the obligations of the VALLEY DISTRICT as set forth in this Agreement. 7. Notices. All notices, requests, demands, or other communications required or permitted under this Agreement shall be in writing unless provided otherwise herein and shall be deemed to have been duly given and received if mailed to the parties to whom notices are to be given by first class mail, registered or certified, postage prepaid, addressed as follows: Notice to VALLEY DISTRICT: Douglas Headrick, General Manager San Bernardino Valley Municipal Water District 380 East Vanderbilt Way San Bernardino, CA David R. E. Aladjem Regional Recycled Water Pipeline Reimbursement Agreement January 16, 2019 Page 3 of

34 Execution Copy January 16, 2019 Downey Brand, LLP 621 Capital Mall Sacramento, CA Notice to EVWD: John Mura, General Manager/CEO East Valley Water District Greenspot Road Highland, CA Jean Cihigoyenetche JC Law Firm 5871 Pine Avenue, Suite 200 Chino Hills, CA Binding Effect. This Agreement shall inure to the benefit of and shall be binding upon the parties hereto and their respective successors and assigns. 9. Entire Agreement. This Agreement shall constitute the entire agreement between the parties hereto with respect to its subject matter and supersedes all prior Agreements, understandings, negotiations, representations, and discussions, whether verbal or written, of the parties, pertaining to that subject matter. 10. Severability. If any provision of this Agreement is determined to be illegal and unenforceable, all other provisions shall nevertheless be effective. 11. Governing Law. This Agreement and the legal relations between the parties hereto shall be governed by and be construed in accordance with the laws of the state of California with venue in the Superior Court for the County of San Bernardino, California. Regional Recycled Water Pipeline Reimbursement Agreement January 16, 2019 Page 4 of

35 Execution Copy January 16, Counterparts. This Agreement may be executed in several counterparts and all such executed counterparts shall constitute one document, binding on all the parties hereto, notwithstanding that all of the parties hereto are not signatories to the original or to the same counterpart. /// IN WITNESS WHEREOF, the Parties, EVWD and VALLEY DISTRICT, have executed this Agreement as of the date first set forth above. VALLEY DISTRICT: By: Printed Name: Douglas D. Headrick Its: General Manager EVWD: By: Printed Name: Its: Regional Recycled Water Pipeline Reimbursement Agreement January 16, 2019 Page 5 of

36 9TH ST Exhibit A - Regional Recycled Water Pipeline Map SNRC Site 6TH ST HIGHLAND 5TH ST po City Creek Spreading I1:24,000 SAN BERNARDINO ALABAMA ST }þ 210 Redlands Basins REDLANDS SAN BERNARDINO AVE Legend Re-Purposed Existing Pipeline Future Recycled Water Pipeline Y:\2018\1800_SNRC\ExhibitA.mxd

37 To: From: Governing Board Members General Manager/CEO BOARD AGENDA STAFF REPORT Agenda Item #5. Meeting Date: February 13, 2019 Discussion Item Subject: Consider Authorization of the Purchase and Sale Agreement for the Sterling Property with the City of San Bernardino RECOMMENDATION: Authorize the General Manager/CEO to execute the Purchase and Sale Agreement with the City of San Bernardino and San Bernardino Municipal Water Department for APNs and as outlined in the 2017 Settlement Agreement. BACKGROUND / ANALYSIS: Setting out to construct headquarters facility, the District purchased property in the area of Sterling Avenue and 3rd Street within the City of San Bernardino in For a number of reasons, including the restrictions on the property due to its proximity to the San Bernardino International Airport and the intended long-term facility use, the District instead constructed the Headquarters Facility on Greenspot Road. The Sterling property was also considered for the Sterling Natural Resource Center, but ultimately the 5th Street property was selected instead. The parcels were determined to be surplus by the Governing Board in 2012 as required prior to the sale of District property. In 2017, the District settled litigation with the City of San Bernardino relating to the Sterling Natural Resource Center. Within that settlement agreement were various terms that fostered a new level of community cooperation and collaboration. One element of the agreement was the sale of the Sterling property to the City of San Bernardino for the balance of the East Trunk Sewer Fund at the close of escrow. This agreement spells out the mechanics of the actual transaction. The District and the City of San Bernardino continue to work together to complete the few remaining terms of the settlement agreement through open dialogue. AGENCY GOALS AND OBJECTIVES: Goal and Objectives I - Implement Effective Solutions Through Visionary Leadership c) Strengthen Regional, State and National Partnerships

38 REVIEW BY OTHERS: This agenda item has been reviewed by Legal Counsel. FISCAL IMPACT The fiscal impact of this item will result in revenue equaling the fund balance of the East Trunk Sewer Fund from the property sale. Recommended by: John Mura General Manager/CEO Respectfully submitted: Kelly Malloy Director of Strategic Services

39 To: From: Governing Board Members General Manager/CEO BOARD AGENDA STAFF REPORT Agenda Item #6. Meeting Date: February 13, 2019 Discussion Item Subject: Consider Adoption of Five-Year Work Plan RECOMMENDATION: Staff recommends that the Board consider adoption of the Five-Year Work Plan. BACKGROUND / ANALYSIS: East Valley Water District has set out to be a world class organization, with a focus not only on providing safe and reliable drinking water but of enhancing and preserving the quality of life for our community. To achieve these high expectations, a series of planning and tracking measures must be implemented. Through a series of planning measures, the Governing Board, staff, and the community have developed a District vision that empowers the organization to take actions to be innovative, efficient, and effective. The next step in the planning process is looking to the future in a strategic manner. Many of the District s critical efforts require careful planning, environmental awareness, and clear prioritization to allow for on-going daily operations while addressing specific long-term needs. Consistent with this commitment, a District-wide Goal for Fiscal Year was adopted to develop a 5-year work plan for Board consideration. Through a series of meetings with the Governing Board, staff, and the Community Advisory Commission a draft Five-Year Work Plan has been prepared for consideration with an emphasis on the elements needed to clearly look to the future. This effort is designed to provide general policy direction and highlight priority projects that allows for the prioritization and development of specific tasks necessary for implementation. If adopted, the Five-Year Work Plan would be incorporated into the annual District-wide goals assigned to the General Manager/CEO, development of future budgets, and resource allocation. AGENCY GOALS AND OBJECTIVES: Goal and Objectives III - Deliver Public Service with Purpose While Embracing Continuous Growth d) Embrace an Environment of Active Learning and Knowledge Sharing

40 REVIEW BY OTHERS: This item has been presented to the Governing Board, District staff, and Community Advisory Commission for comments. FISCAL IMPACT There is no fiscal impact associated with this agenda item. Recommended by: John Mura General Manager/CEO ATTACHMENTS: Description Five Year Work Plan Respectfully submitted: Kelly Malloy Director of Strategic Services Type Cover Memo

41 EAST VALLEY WATER DISTRICT 5-YEAR WORK PLAN LEADERSHIP PARTNERSHIP STEWARDSHIP

42 SUMMARY East Valley Water District has set out to be a world class organization, with a focus not only on providing safe and reliable drinking water but of enhancing and preserving the quality of life for our community. In order to achieve these high expectations, a series of planning and tracking measures must be implemented. Operating as a world class organization requires the internal team to continuously act in exemplary ways. Through a series of planning measures, the Governing Board, staff, and the community have developed a District vision that empowers the organization to take actions to be innovative, efficient, and effective. From this vision, a Strategic Plan has been developed to guide District operations. The next step in the planning process is looking to the future in a strategic manner. Many of the District s critical efforts require careful planning, environmental awareness, and clear prioritization to allow for on-going daily operations while addressing specific long-term needs. Having intermediate and long-term plans in place allows for steps to be taken that support sustainable operations, however, it is a dynamic process which can require adjustment to external factors as necessary.

43 STRATEGIC PLAN WORKFLOW

44 Desired Results, Available/Needed Resources, Actions to be taken, Measures District Vision Strategic Plan 5, 10, 20 -Year Plan Program/ Individual Goals Resources Acceptance of Effort North Fork Program Development Financials Surface Water Treatment Plant/ Uses for Water Optimize Infrastructure Systems Mutual Water Company Consolidations City Creek Arroyo Verde Tres Lagos System Optimization Short-term Obligations Long-term Infrastructure Rates Cost of Service Analysis Financial Stability with Full Understanding of Operational Complexities Impact Fees Pension Obligations Grants Payment Schedule Understand Debt Impacts and Cycles Acknowledge Unknowns Branding Foster Commitment Foster Belief in Who We Are Protect Organizational Investments Culture Staffing Analysis Succession Planning Caliber of Employees & their replacements What Makes us Different Continued Growth and Development Engineering Staffing Enhance and preserve the quality of life for our community through innovative leadership and world class public service. Facilitate Win-Win with New Development Master Plan (15, 20 year plans) Updates Policies/ Practices Consistency Maintain a Nexus between the Master Plns and Development Agreements Water Avoid Short-sided Decisions Wastewater Leadership, Partnership Stewardship Development District Properties Understand Constraints Understand Deficiencies Energy Efficiencies Maximize the District's Position Repair/Rehab Have Flexibility Septic-to-Sewer Water Cost Infrastructure SNRC 78 Security Network Facilities Actively Participate in Regional Projects Partnerships San Manuel Village Lakes Groundwater Council HCP- Santa Ana River HCP- Wash Plan Reduction of GW Dependence Capital Improvement Plan Less Sequencing, More Flexibility Ability to Take Advantage of Opportunities Have Others See the District as a Premier Agency CHEF Spark community loyalty and connection Develop organizational structures Facilities mapping / planning Financials Fundraising Outreach Long-term maintenance Regional Involvement 5YearwithDistrictVision_ mmap - 2/6/ Mindjet

45 To: From: Governing Board Members General Manager/CEO BOARD AGENDA STAFF REPORT Agenda Item #7. Meeting Date: February 13, 2019 Discussion Item Subject: Consider Approval of Fiscal Year Mid-Year Budget Revisions RECOMMENDATION: Staff recommends that the Board of Directors (Board) review and approve amendments to the FY Operating and Capital Budgets. BACKGROUND / ANALYSIS: The Mid-Year Budget Review is presented for the Board of Directors review and consideration. This analysis and process provides the Board the opportunity to review the status of the operating and capital budgets as of December 31 st, and to consider recommended adjustments. In summary, staff has been monitoring program and capital expenditures through December, and expenditures are tracking very close to the adopted budget. This staff report requests one minor, and two significant expenditure increases totaling $925,000, and also proposes revenue adjustments to cover the expenditure requests. As mentioned below, both of the significant increases in expenditures have previously been discussed with the Board, so proposing to add them to the budget at mid-year, along with a funding source, is a necessary formality. The requested budget adjustments, and justifications therefore, are described below. Revenues Water sales were $757,000 over projection through December, at $9,851,204. This variance is due to a higher than expected spike in water usage for the month of August, with usage in October and December also coming in higher than projected. The chart below presents customer water usage by Tier for the six months ended December 31 st. Tier 1 usage was under projection by just 0.2%, while Tiers 2 and 3 were over projection by 3.5% and 31.3%, respectively. Customer outdoor use did fall month after month between July and December, but not as quickly as temperatures and other conditions recorded by the District s weather station. As a result, customers who were slow to adjust sprinkler settings while outdoor water budgets were shrinking, ended up paying for a significant portion of outdoor water use at Tier 3 rates.

46 Higher than projected water usage has continued into January resulting in high water sales for that month as well. Therefore, based on the variance through December, and knowing that sales have continued to exceed projection in the current quarter, staff is recommending a $700,000 increase to budgeted water sales as a mid-year budget adjustment. No adjustment is proposed for Water Department meter charge revenue. In the Wastewater Department, Wastewater Collection revenue of $2,361,627 is 2% above projection of $2,315,000 at mid-year. Staff is recommending that the budget for Wastewater Collection revenues be increased by $50,000 The following two adjustments are proposed for Non-Operating / Other Revenue categories: Increase investment revenue by $60,000. Investment revenue is at 67% of projections through December with the apportionment rate paid by the Local Agency Investment Fund (currently 2.4%) expected to continue to rise. Increase Energy Incentive Rebates' revenue by $115,000 to account for a check received from Edison in September for commissioning of the Hydro Electric plant at Plant 134. Operating Expenses Through December, operating expenses were at $14,116,215, which is 49% of $28,675,000 in operating expenses budgeted for the year. While overall actual expenditures are in line with budget expectations through mid-year, two line items on the attached report show significant variation from budget, and are explained below: Water supply costs (Program 5000-Water Production) are at less than 10% of budget at mid-year because 1) Valley District has not completely billed EVWD for our $450,000 allocation of costs related to the Groundwater Sustainability Council, 2) EVWD did not purchase $500,000 of state project water as budgeted, and 3) estimated North Fork assessments of $122,000 will not be invoiced until May/June 2019 if North Fork Water Company assessments are adopted this year.

47 There are no budget adjustments related to this item. Contract services in Program 2300-Conservation, is 228% over budget due to unexpected timing of a payment to San Bernardino for street median landscaping. This $500,000 contribution toward water efficient landscaping was part of the settlement agreement with the City but had not been included in the District s adopted budget. Accordingly, a $500,000 budget increase is requested for Conservation Contract Services. One other adjustment requested for Operating Expenses is a $50,000 increase to Contract Services in Program 7100-Fleet Maintenance. One of two technicians in the garage retired at the beginning of FY and was not replaced. Instead, vendors were contracted to come to the District during off hours and perform fleetwide routine services such as oil changes. An estimated budget for these services will fall short by year end, so a budget increase is needed to complete the fiscal year. The total proposed increase to the Operating Expense budget is $550,000. Capital Expenditures Staff has evaluated the Capital Budget and the information that has become available since the budget was adopted, and is requesting that the following adjustments be approved at mid-year: Plant 134 Membrane Replacement / Site Improvements The Capital Budget included $405,000 to replace a full train of filter membranes at the District s surface water treatment Plant 134. The actual cost for the membranes was $250,000. Also included in the Budget was $150,000 to research and design various site improvements, including a much more robust fence around the perimeter of the plant to mitigate the threat of intrusion. After some preliminary research, staff is confident that a wrought iron fence can be installed to replace the existing chain link fence that will cost between $250,000 and $300,000. Staff is requesting authorization to transfer the remaining $155,000 from the membrane replacement project, to combine with the $150,000 for site improvements so that the wrought iron fence can be bid and installed at Plant 134 during this fiscal year. Land Acquisition Late in 2018, the house and land located just east of the Sterling Natural Resource Center project site was listed for sale at $374,000. The District desired to acquire this property for possible future plant expansion, so the Board authorized the General Manager / CEO to make an offer on the property. An offer of $364,000 was accepted, and the District entered escrow on the property in January 2019, as announced at the January 23, 2019 Board meeting. The purchase of the property was not included in the budget; therefore, staff is proposing a budget adjustment to Capital Expenditures of $375,000 to be paid out of increased revenues. Summary The table below presents a summary of actual revenue and expenditures year-to-date, the adopted budget, and proposed amendments to the budget. Proposed amendments to expenditures total $925,000 and will be funded by current year revenues which are expected to exceed projections by the same amount.

48 A detailed schedule of proposed adjustments to Capital Expenditures is attached. Staff is recommending that the Board approve $925,000 in adjustments to both revenue and expenditures in the Operating and Capital Expenditure budgets as presented above and in the attachments. AGENCY GOALS AND OBJECTIVES: Goal and Objectives II - Maintain a Commitment to Sustainability, Transparency, and Accountability a) Practice Transparent and Accountable Fiscal Management REVIEW BY OTHERS: This agenda item has been reviewed by the Administration and Finance departments. FISCAL IMPACT If approved, staff s recommendation to increase expenditures in the operating and capital budgets by $925,000 will be offset by expected increases in operating and non-operating revenue.

49 Recommended by: John Mura General Manager/CEO Respectfully submitted: Brian Tompkins Chief Financial Officer ATTACHMENTS: Description Presentation Budget Reports Capital Expenditures Type Presentation Backup Material Backup Material

50 FY MID-YEAR REVIEW February 13, 2019

51 OPERATING BUDGET REVIEW FISCAL YEAR

52 WATER FUND SUMMARY REVENUE BUDGET YTD ACTUAL YTD % PROJECTED Water Sales $ 15,100,000 $ 9,851,204 65% $ 15,800,000 Meter Charges 8,960,000 4,500,054 50% 8,960,000 Other Charges / Revenue 673, , % 848,000 Total Revenue $ 24,733,000 $ 15,196,639 61% $ 25,608,000 EXPENSES BUDGET YTD ACTUAL YTD % PROJECTED Labor & Benefits $ 7,370,900 $ 3,834,627 52% $ 7,370,900 Other Operating Expenses 9,136,100 4,436,302 49% 9,636,100 Capital Expenditures 4,106, ,413 20% 4,481,000 Debt Service 4,046,000 2,172,171 54% 4,046,000 Transfer To Reserves 74,000-0% 74,000 Total Expenses $ 24,733,000 $ 11,256,513 46% $ 25,608,000 Net $ - $ 3,940,126 $ - 3

53 WASTEWATER FUND SUMMARY REVENUE BUDGET YTD ACTUAL YTD % PROJECTED Collection System Charges $ 4,630,000 $ 2,361,627 51% $ 4,680,000 Treatment Charges 8,233,000 4,423,954 54% 8,233,000 Other Charges / Revenue 252,000 48,278 19% 252,000 Total Revenue $ 13,115,000 $ 6,833,858 52% $ 13,165,000 EXPENSES BUDGET YTD ACTUAL YTD % PROJECTED Labor & Benefits $ 2,167,100 $ 974,230 45% $ 2,167,100 Other Operating Expenses 10,000,900 4,871,055 49% 10,050,900 Capital Expenditures 15,605,000 3,094,886 20% 15,605,000 Debt Service 312, ,488 67% 312,000 Debt Proceeds (15,000,000) (2,500,000) 17% (15,000,000) Transfer To Reserves 30,000-0% 30,000 Total Expenses $ 13,115,000 $ 6,647,659 51% $ 13,165,000 Net $ - $ 186,199 $ - 4

54 PROGRAM SUMMARIES

55 GOVERNING BOARD GOAL Provide Organizational Direction and Set Expectations Through Policy Decisions Address Policy Related Decisions to Construct the Sterling Natural Resource Center (SNRC) Participate in Activities to Promote Community Engagement and Increase Board Qualifications % COMPLETE BUDGET PROJECTED % YTD FY FY CHANGE $337,000 $84,051 $337, % 60% 6

56 GENERAL ADMINISTRATION GOAL Acquire Shares of NFWC not Currently Owned By District Coordinate Establishment of Community Non- Profit (Heritage & Education Foundation) Implement District Wide Records Retention Program % COMPLETE BUDGET PROJECTED % YTD FY FY CHANGE $1,258,000 $586,742 $1,258, % 75% 7

57 HUMAN RESOURCES GOAL Initiate Programs In Support of SNRC Workforce Needs Promote Positive Organizational Culture that Maintains Supportive/Encouraging Environment Promote Community Involvement and Provide Work Experience Opportunities % COMPLETE BUDGET PROJECTED % YTD FY FY CHANGE $990,000 $553,154 $990, % 50% 8

58 PUBLIC AFFAIRS GOAL Implement Outreach Efforts that Promote Community Engagement in SNRC Develop Communications Methods that Enhance the District s Brand Advance District s Emergency Response Program to Effectively Respond in Emergency % COMPLETE BUDGET PROJECTED % YTD FY FY CHANGE $1,142,000 $596,109 $1,142, % 45% 9

59 CONSERVATION GOAL Develop Community Engagement Programs to Increase Awareness of Water-Use Efficiency Evaluate Rebate Program Success and Implement Program Enhancements Engage in Legislative Process as it Relates to Changes in Conservation Regulations % COMPLETE BUDGET PROJECTED % YTD FY FY CHANGE $593,000 $775,413 $1,093, % 45% 10

60 FINANCE GOAL Enhance Financial Reporting to Internal / External Stakeholders Engage Stakeholders in Planning for Use of Public Funds Link Fixed Asset Information in Tyler Software to Digitized Maps in GIS Program % COMPLETE BUDGET PROJECTED % YTD FY FY CHANGE $1,131,000 $633,731 $1,131, % 55% 11

61 INFORMATION TECHNOLOGY GOAL Ensure Effective Technology with Proactive Planning and Maintenance Activities Conduct Critical System Upgrades to Help Ensure Business Continuity Enable Data Collection and Data Management Efforts for Other Departments % COMPLETE BUDGET PROJECTED % YTD FY FY CHANGE $1,009,000 $440,454 $1,009, % 65% 12

62 CUSTOMER SERVICE GOAL Develop Strategies to Address Organizational Service Needs Modify Processes to Encourage World Class Customer Service while Maintaining Financial Stability Establish a Professional Development Plan that Supports the District s Vision % COMPLETE BUDGET PROJECTED % YTD FY FY CHANGE $1,786,000 $774,100 $1,786, % 60% 13

63 METER SERVICES GOAL % COMPLETE Evaluate Opportunities and Impacts Resulting from the AMI Implementation Collect Information on Existing Meters to Facilitate Future Phases of AMI Implementation Develop a Proactive Meter Testing Program 100 BUDGET PROJECTED % YTD FY FY CHANGE $283,000 $130,930 $283, % 85% 14

64 ENGINEERING GOAL % COMPLETE Develop and Implement the District s CIP to Address Rehabilitation and Maintenance Needs while also Preparing for New Development Develop and Expand Workflow Procedures to Maximize Inter-Departmental Communication and Cooperation with Engineering Support the Steps Necessary for the Advancement of the SNRC BUDGET PROJECTED % YTD FY FY CHANGE $1,521,000 $612,480 $1,521, % % 15

65 WATER PRODUCTION GOAL Develop a Water Supply Mix Plan to Maximize Surface Water Implement Improvements to Enhance the SCADA System Develop a Plan to Address Challenges and Opportunities Related to NFWC % COMPLETE BUDGET PROJECTED % YTD FY FY CHANGE $4,378,000 $1,945,693 $4,378, % 45% 16

66 WATER TREATMENT GOAL Incorporate Operation and Maintenance of the Hydro-Generation Technology at Plant 134 Complete Plant 134 Membrane Replacement Phase Two of the 5-Year Replacement Plan Support the Development of a Long-term Plant 134 Site Improvement Plan % COMPLETE BUDGET PROJECTED % YTD FY FY CHANGE $848,000 $400,500 $848, % 60% 17

67 WATER QUALITY GOAL Conduct Expanded Sampling Programs to Ensure Compliance with All State & Federal Water Quality Requirements Implement Mandatory Lead Sampling in Schools as Required by Assembly Bill 746 Implement In-House Environmental Controls and Compliance Program % COMPLETE BUDGET PROJECTED % YTD FY FY CHANGE $434,000 $216,501 $434, % 65% 18

68 WATER MAINTENANCE GOAL GPS All Valves and Meter Boxes within the Service Area Review Data Accuracy Compared to Actual Field Conditions Facilitate Technology Trainings and Community Engagement % COMPLETE BUDGET PROJECTED % YTD FY FY CHANGE $2,549,000 $1,337,950 $2,549, % 50% 19

69 WASTEWATER MAINTENANCE GOAL % COMPLETE Complete Implementation of GraniteNet Software to Collect Data Regarding Wastewater Collection System Maintenance Identify Operational Changes Needed to Accommodate Planned Development within the District Incorporate GPS Data to Enhance Efficiency of Wastewater Maintenance Operations and Asset Management BUDGET PROJECTED % YTD FY FY CHANGE $8,996,000 $4,335,071 $8,996, % % 20

70 FACILITIES MAINTENANCE GOAL Develop a Long-Term Plant 134 Site Improvement Plan Develop a Facilities Maintenance Program to Track and Anticipate Future Costs Associated with All District Facilities Complete Systematic Upgrades and Rehabilitation of District Facilities % COMPLETE BUDGET PROJECTED % YTD FY FY CHANGE $961,000 $421,302 $961, % 55% 21

71 FLEET MAINTENANCE GOAL % COMPLETE Enhance Emergency Response Capabilities 100 Utilize the Most Effective Fleet Maintenance Methods Participate in SNRC Design to Identify Future Impacts to the Fleet BUDGET PROJECTED % YTD FY FY CHANGE $459,000 $272,033 $509, % 75% 22

72 CAPITAL BUDGET CAPITAL OUTLAY

73 CAPITAL OUTLAY PROJECT FUNDING SOURCE ADJUSTED BUDGET PROPOSED MID-YEAR ADJUSTMENT PROJECTED BUDGET Vehicles Water Operating Revenue $ 150,000 $ - $ 150,000 Computer / Phone System Upgrades Water/Wastewater Operating Revenue 125, ,000 Planning Studies Water/Wastewater Operating Revenue 270, ,000 Acquisition of Water Company Shares Water Operating Revenue 250, ,000 Office Furniture & Equipment Water/Wastewater Operating Revenue 20,000-20,000 Water Tank Mixers Water Operating Revenue 161, ,000 Upgrade Server Room Fire Suppression Water/Wastewater Operating Revenue 40,000-40,000 Upgrade HVAC at Various Plants Water Operating Revenue 40,000-40,000 Sewer Lateral Snake / Locater Wastewater Operating Revenue 20,000-20,000 Drone Water/Wastewater Operating Revenue 30,000-30,000 TOTAL $ 1,106,000 $ - $ 1,106,000 24

74 CAPITAL BUDGET CAPITAL IMPROVEMENT PROJECTS

75 CIP PROPOSED ADJUSTMENTS PROJECT FUNDING SOURCE ADJUSTED BUDGET PROPOSED MID-YEAR ADJUSTMENT PROJECTED BUDGET Land Acquisition Water Operating Revenue $ - $ 375,000 $ 375,000 Plant Site Improvements Reserves 150, , ,000 Plant Membrane Replacements Reserves 405,000 (155,000) 250,000 Wastewater Main Rehabilitation - Modesto Drive Wastewater Operating Revenue 250,000 (115,000) 135,000 Wastewater Main Rehabilitation - 35th Street Wastewater Operating Revenue 180,000 (85,000) 95,000 Wastewater Main Rehabilitation - Ferndale Avenue Wastewater Operating Revenue - 125, ,000 Wastewater Main Rehabilitation - Orange Street Wastewater Operating Revenue $ - $ 75,000 $ 75,000 Total Proposed Mid-Year Adjustments $ 985,000 $ 375,000 $ 1,360,000 26

76 CIP NO PROPOSED ADJUSTMENTS PROJECT FUNDING SOURCE ADJUSTED BUDGET PROPOSED MID-YEAR ADJUSTMENT PROJECTED BUDGET AMI Meter Replacement Program Water Operating Revenue $ 1,000,000 $ - $ 1,000,000 Canal Zone Storage Reservoir Developer Fees 500, ,000 Transmission Main - Plant 134 to Upper Zone Water Operating Revenue 1,100,000-1,100,000 Plant Process Improvements Water Operating Revenue 150, ,000 Plant Hydro Tank Replacement Water Operating Revenue 350, ,000 Water Mains - Dwight & Glasgow Water Operating Revenue 200, ,000 Facilities Relocations Water Operating Revenue 100, ,000 Facilities Rehabilitation Water Operating Revenue 75,000-75,000 Well & Booster Improvements / Rehabilitations Water Operating Revenue 50,000-50,000 Sterling Natural Resource Center (SNRC) Grants/Loans Other Fund 15,000,000-15,000,000 Subtotal Proposed Mid-Year Adjustments 985, ,000 18,525,000 Total $ 19,510,000 $ 375,000 $ 19,885,000 27

77 STAFFING CHANGES

78 PROPOSED STAFFING CHANGES DEPARTMENT Finance CURRENT POSITION Customer Service Representative III PROPOSED POSITION Accounting Technician *Proposed Adjustments are Reflected in Department Summaries 29

79 ACCOMPLISHMENTS

80 ACCOMPLISHMENTS Created the Community Heritage and Education Foundation Non-Profit Foundation Selected Balfour Beatty and hosted a community groundbreaking for the SNRC Implemented Community Volunteer Program Completed K-12 Lead Sampling in all schools Installed radios in all District vehicles for emergency preparedness Completed the AMI Project Phase III Presented the PERS Unfunded Liability Funding Plan Adopted the Five-Year Work Plan 31

81 AWARDS California Special District s Association s Transparency Award Press Enterprise Top Workplace Honorable Mention California Society of Municipal Finance Officers Excellence Award in Budgeting 32

82

83 DISTRICT WIDE FY MID-YEAR BUDGET REVIEW JULY 1, DECEMBER 31, 2018 FY Budget FY Percent Budget YTD Activity Adjustment Projected Change Revenue Water Sales 15,100, ,851, , ,800, Meter Charges 8,960, ,500, ,960, Penalties 544, , , Wastewater Collection 4,630, ,361, , ,680, Wastewater Treatment 8,233, ,423, ,233, Other Operating Charges 121, , , Investment Income 220, , , , Energy Incentive Rebates - 115, , , Miscellaneous Revenue 40, , , ,848, ,030, , ,773, % Program: Board of Directors ogra51 - Labor 105, , , ogra52 - Temporary Labor ogra53 - Overtime ogra54 - Standby ogra56 - Benefits 65, , , ogra61 - Water Supply ogra62 - Materials and Supplies 1, , ogra63 - Contract Services 111, , ogra64 - Utilities ogra65 - Professional Development 55, , , ogra67 - Other ogra Total 337, , , % Program: General Administration ogra51 - Labor 507, , , ogra52 - Temporary Labor ogra53 - Overtime 3, , , ogra54 - Standby ogra56 - Benefits 270, , , ogra61 - Water Supply ogra62 - Materials and Supplies 8, , , ogra63 - Contract Services 360, , , ogra64 - Utilities 3, , , ogra65 - Professional Development 107, , , ogra67 - Other ogra Total 1,258, , ,258, % Program: Human Resources ogra51 - Labor 224, , , ogra52 - Temporary Labor ogra53 - Overtime 3, , , ogra54 - Standby ogra56 - Benefits 104, , , ogra61 - Water Supply ogra62 - Materials and Supplies 17, , , ogra63 - Contract Services 311, , , ogra64 - Utilities 1, , ogra65 - Professional Development 40, , , Page 1 of 6

84 DISTRICT WIDE FY MID-YEAR BUDGET REVIEW JULY 1, DECEMBER 31, 2018 FY Budget FY Percent Budget YTD Activity Adjustment Projected Change ogra67 - Other 290, , , ogra Total 990, , , % Program: Public Affairs ogra51 - Labor 393, , , ogra52 - Temporary Labor ogra53 - Overtime 7, , , ogra54 - Standby ogra56 - Benefits 132, , , ogra61 - Water Supply ogra62 - Materials and Supplies 189, , , ogra63 - Contract Services 352, , , ogra64 - Utilities 28, , , ogra65 - Professional Development 41, , , ogra67 - Other ogra Total 1,142, , ,142, % Program: Conservation ogra51 - Labor 98, , , ogra52 - Temporary Labor ogra53 - Overtime 3, , , ogra54 - Standby ogra56 - Benefits 27, , , ogra61 - Water Supply ogra62 - Materials and Supplies 228, , , ogra63 - Contract Services 210, , , , ogra64 - Utilities 22, , ogra65 - Professional Development 5, , , ogra67 - Other ogra Total 593, , , ,093, % Program: Finance ogra51 - Labor 650, , , ogra52 - Temporary Labor - 3, ogra53 - Overtime 5, , , ogra54 - Standby ogra56 - Benefits 259, , , ogra61 - Water Supply ogra62 - Materials and Supplies 11, , , ogra63 - Contract Services 172, , , ogra64 - Utilities 4, , ogra65 - Professional Development 29, , , ogra67 - Other 1, , ogra Total 1,131, , ,131, % Program: Information Technology ogra51 - Labor 334, , , ogra52 - Temporary Labor ogra53 - Overtime ogra54 - Standby - - ogra56 - Benefits 109, , , ogra61 - Water Supply - - ogra62 - Materials and Supplies 35, , , ogra63 - Contract Services 501, , , Page 2 of 6

85 DISTRICT WIDE FY MID-YEAR BUDGET REVIEW JULY 1, DECEMBER 31, 2018 FY Budget FY Percent Budget YTD Activity Adjustment Projected Change ogra64 - Utilities 5, , , ogra65 - Professional Development 25, (108.90) - 25, ogra Total 1,009, , ,009, % Program: Customer Service ogra51 - Labor 476, , , ogra52 - Temporary Labor - 13, ogra53 - Overtime 5, , , ogra54 - Standby ogra56 - Benefits 257, , , ogra61 - Water Supply ogra62 - Materials and Supplies 8, , , ogra63 - Contract Services 865, , , ogra64 - Utilities 159, , , ogra65 - Professional Development 16, , ogra67 - Other ogra Total 1,786, , ,786, % Program: Meter Service ogra51 - Labor 178, , , ogra52 - Temporary Labor ogra53 - Overtime 10, , , ogra54 - Standby ogra56 - Benefits 80, , , ogra61 - Water Supply ogra62 - Materials and Supplies 5, , ogra63 - Contract Services 8, , , ogra64 - Utilities 2, , ogra65 - Professional Development ogra67 - Other ogra Total 283, , , % Program: Engineering ogra51 - Labor 707, , , ogra52 - Temporary Labor ogra53 - Overtime 2, , , ogra54 - Standby ogra56 - Benefits 263, , , ogra61 - Water Supply ogra62 - Materials and Supplies 25, , , ogra63 - Contract Services 348, , , ogra64 - Utilities 138, , , ogra65 - Professional Development 37, , , ogra67 - Other ogra Total 1,521, , ,521, % Program: Water Production ogra51 - Labor 649, , , ogra52 - Temporary Labor ogra53 - Overtime 61, , , ogra54 - Standby 15, , , ogra56 - Benefits 292, , , ogra61 - Water Supply 1,067, , ,067, ogra62 - Materials and Supplies 284, , , Page 3 of 6

86 DISTRICT WIDE FY MID-YEAR BUDGET REVIEW JULY 1, DECEMBER 31, 2018 FY Budget FY Percent Budget YTD Activity Adjustment Projected Change ogra63 - Contract Services 481, , , ogra64 - Utilities 1,514, , ,514, ogra65 - Professional Development 15, , , ogra67 - Other ogra Total 4,378, ,945, ,378, % Program: Water Treatment ogra51 - Labor 214, , , ogra52 - Temporary Labor ogra53 - Overtime 25, , , ogra54 - Standby ogra56 - Benefits 95, , , ogra61 - Water Supply ogra62 - Materials and Supplies 165, , , ogra63 - Contract Services 149, , , ogra64 - Utilities 200, , , ogra65 - Professional Development ogra67 - Other ogra Total 848, , , % Program: Water Quality ogra51 - Labor 168, , , ogra52 - Temporary Labor ogra53 - Overtime 15, , , ogra54 - Standby ogra56 - Benefits 66, , , ogra61 - Water Supply ogra62 - Materials and Supplies 18, , , ogra63 - Contract Services 159, , , ogra64 - Utilities 2, , , ogra65 - Professional Development 6, , ogra67 - Other ogra Total 434, , , % Program: Field Maintenance Administration ogra51 - Labor 177, , , ogra52 - Temporary Labor ogra53 - Overtime 20, , ogra54 - Standby 20, , , ogra56 - Benefits 90, , , ogra61 - Water Supply ogra62 - Materials and Supplies 3, , ogra63 - Contract Services 1, , , ogra64 - Utilities 21, , , ogra65 - Professional Development 13, , , ogra67 - Other ogra Total 345, , , % Program: Water Maintenance ogra51 - Labor 925, , (125,000.00) 800, ogra52 - Temporary Labor ogra53 - Overtime 130, , , , ogra54 - Standby ogra56 - Benefits 454, , , Page 4 of 6

87 DISTRICT WIDE FY MID-YEAR BUDGET REVIEW JULY 1, DECEMBER 31, 2018 FY Budget FY Percent Budget YTD Activity Adjustment Projected Change ogra61 - Water Supply ogra62 - Materials and Supplies 241, , , ogra63 - Contract Services 454, , , ogra64 - Utilities - 6, ogra65 - Professional Development ogra67 - Other ogra Total 2,204, ,129, ,204, % Program: Wastewater Maintenance ogra51 - Labor 290, , , ogra52 - Temporary Labor ogra53 - Overtime 45, , , ogra54 - Standby ogra56 - Benefits 146, , , ogra61 - Water Supply ogra62 - Materials and Supplies 36, , , ogra63 - Contract Services 8,479, ,145, ,479, ogra64 - Utilities ogra65 - Professional Development ogra67 - Other ogra Total 8,996, ,335, ,996, % Program: Facilities Maintenance ogra51 - Labor 147, , , ogra52 - Temporary Labor ogra53 - Overtime 15, , , ogra54 - Standby ogra56 - Benefits 79, , , ogra61 - Water Supply ogra62 - Materials and Supplies 46, , , ogra63 - Contract Services 459, , , ogra64 - Utilities 214, , , ogra65 - Professional Development 1, , ogra67 - Other ogra Total 961, , , % Program: Fleet Maintenance ogra51 - Labor 81, , , ogra52 - Temporary Labor ogra53 - Overtime 3, , ogra54 - Standby ogra56 - Benefits 40, , , ogra61 - Water Supply ogra62 - Materials and Supplies 45, , , ogra63 - Contract Services 170, , , , ogra64 - Utilities 113, , , ogra65 - Professional Development 6, , ogra67 - Other ogra Total 459, , , , % ogratotal Operating Expenses 28,675, ,116, , ,225, Other Expenses 71 - Debt Service 4,358, ,379, ,358, ogra81 - Capital Improvement 18,605, ,809, , ,980, ogra82 - Capital Outlay 1,106, , ,106, Page 5 of 6

88 DISTRICT WIDE FY MID-YEAR BUDGET REVIEW JULY 1, DECEMBER 31, 2018 FY Budget FY Percent Budget YTD Activity Adjustment Projected Change ogra83 - Debt Proceeds (15,000,000.00) (2,500,000.00) - (15,000,000.00) ogra88 - Transfer to Reserves 104, , ogra Total 9,173, ,787, , ,548, % Net - 4,126, Page 6 of 6