Annual Budget. Fiscal Year Prepared by Division of Management and Budget Lyle G. Beefelt, Director. Exceptional Water Service

Transcription

1 Fiscal Year 2016 Annual Budget Prepared by Division of Management and Budget Lyle G. Beefelt, Director Exceptional Water Service

2 Prince William County Service Authority Annual Budget Fiscal 2016 Adopted THE BOARD OF DIRECTORS PAUL E. RUECKER, CHAIRMAN JOYCE P. EAGLES, VICE-CHAIRMAN JANICE R. CARR, SECRETARY-TREASURER ERNIE GONZALES, MEMBER DR. K. JACK KOOYOOMJIAN, MEMBER GARTH PORTER, MEMBER DAVID A. RUTHERFORD, MEMBER L. BEN THOMPSON, MEMBER ADOPTED MAY 14, 2015 DEAN E. DICKEY GENERAL MANAGER

3 Table of Contents Budget Overview...1 Operating Fund...3 Replacement Fund...5 Expansion & Commitment Fund...6 Capital Budget...7 Service Authority Performance...8

4 Glossary of Abbreviations $XXXK Thousands of Dollars LTO Linear Tape-Open 4WD (also 4 X 4) Four-Wheel Drive LXX Lift Station (Wastewater) Number XX ADMIN. Administration M&B Management and Budget AWRF Advanced Water Reclamation Facility MISC. Miscellaneous BNR Biological Nutrient Removal MLSS Mixed Liquor Suspended Solids CAFR Comprehensive Annual Financial Report MS Microsoft System C&P Control and Process NACWA National Association of Clean Water Agencies CCTV Closed Circuit Television Camera O & M Division of Operations and Maintenance CIP DART DO DRW ENG. Capital Improvements Program A detailed schedule of capital projects to be undertaken by the Authority or contributed by developers. Days Away, Restricted or Transferred Dissolved Oxygen Dual Rear Wheel Engineering PA PLC PWCSA RAC SCADA Public Announcement Programmable Logic Controller Prince William County Service Authority Real Application Clusters Supervisory Control and Data Acquisition system a computerized system for remote monitoring and control of facilities. ERU s ESWR EXT. FBI FMU FY XX GFOA Equivalent Residential Units A unit of capacity equal to the peak volume required to serve a typical single-family residential customer. It is currently 400 gallons per day for water and 330 gallons per day for sewer. Environmental Services and Water Reclamation Extended (as-in Extended Cab) Fluidized Bed Incinerator Fuel Management Unit Fiscal Year 20XX Government Finance Officers Association SUV UOSA UTV VEH. VML VWEF YTD Sport Utility Vehicle Upper Occoquan Service Authority A regional AWRF owned by the Authority, Fairfax County, Manassas and Manassas Park. Utility Vehicle Vehicle Virginia Municipal Leaque Virginia Water Environment Federation Year-to-date GIS Geographical Information System HDPE High Density Polyethylene HR Human Resources HROD Human Resources Organizational Development I/O Input/output IT Department of Information Technology LPFM Low Pressure Force Main

5 Fund Structure The accounting general ledger and budget are prepared on a four fund basis, which provides a tool for tracking revenues and expenses as they relate to the Authority s growth and operations. The four funds are named for the four areas on which the budget focuses: operations, capital expansion, debt service (commitment) and capital replacement. General guidelines of the four funds are as follows: Operating Fund: Expansion Fund: Commitment Fund: Replacement Fund: Funded by user rates and used to pay for daily operations. Funded by availability fees and other developer charges and used to pay for development administration and capital projects that increase capacity. Funded by availability fees and interest earned and used to pay debt and capacity agreements. Funded annually by a transfer of excess operating funds and used to pay for capital replacement expenditures.

6 FY 16 Adopted Budget FY 16 Budget Overview The FY 16 Budget totals $132.4 million (see Chart 9), including funds available for Capital Budget Projects and debt principal. Other Interest Income Availability Fees Chart 9 Sources & Uses of Funds All Funds Combined $0.6 $2.5 $24.9 $0.7 $0.5 $19.8 $33.4 Add l Reserves Contingency Other Personnel Costs $120,000,000 $100,000,000 $80,000,000 Chart 10 PWCSA Fund Balances Current Target Projected Consumption & Svc. Charges $104.4 $26.2 $10.9 $40.9 Purchased Res. Interest Expense Available for CIP Projects and Debt Prin. $60,000,000 $40,000,000 $20,000,000 $0 $132.4 Million Sources $132.4 Million Uses The Authority has budgeted for account growth of 1.0%, which is expected to produce $104.4 million in consumption and service charge revenue. The Authority expects to certify 1,600 ERU s in FY 16 and projects $24.9 million in availability fees. The budget projects $40.9 million in net income available for CIP projects and debt principal. Page

7 FY 16 Adopted Budget FY 16 Budget Overview Description TABLE 1 - FY'16 BUDGET SUMMARY - ALL FUNDS FY'14 Actual FY'15 Budget FY'15 Projected FY'16 Request Difference Percent Change Revenue Consumption & Svc. Chrgs $ 102,651,162 $ 104,583,000 $ 103,792,433 $ 104,437,900 $ (145,100) -0.1% Water Availability Fee 10,227,082 10,606,000 9,517,408 7,643,400 (2,962,600) -27.9% Sewer Availability Fee 20,666,880 22,883,000 18,363,594 17,248,200 (5,634,800) -24.6% Interest Income 3,910,462 2,269,300 2,847,151 2,451, , % Other Revenue 587, , , , % Total Revenue $ 138,042,908 $ 140,921,300 $ 135,095,369 $ 132,361,000 $ (8,560,300) -6.1% Expenses Personnel Costs $ 28,056,722 $ 31,817,800 $ 27,602,040 $ 33,405,000 $ 1,587, % Purchased Resources 22,062,269 26,435,700 24,012,079 26,236,600 (199,100) -0.8% Interest Expense 12,114,539 11,880,200 10,029,091 10,928,500 (951,700) -8.0% Other Expenses 15,576,488 19,373,800 15,619,385 19,794, , % Contingency - 700, , ,000 - N/A Total Expenses $ 77,810,018 $ 90,207,500 $ 77,462,594 $ 91,064,400 $ 856, % Net Income (excl. Depr.) $ 60,232,890 $ 50,713,800 $ 57,632,774 $ 41,296,600 $ (9,417,200) -18.6% Page

8 Operating Fund Revenues Description Operating Revenues FY'14 Actual FY'15 Budget FY'16 Request Difference Percent Change Sale of Service - Water $ 29,600,985 $ 30,769,000 $ 30,002,500 $ (766,500) -2.5% Peak Use Charges 1,989,348 2,549,000 2,142,700 (406,300) -15.9% Sale of Service - Sewer 50,641,341 51,438,000 51,155,800 (282,200) -0.5% Service Charge - Water 5,105,476 5,090,000 5,548, , % Service Charge - Sewer 8,765,609 8,561,000 9,459, , % Application Fees 302, , ,300 (700) -0.2% Disconnect Fees 467, , ,800 2, % Late Payment Fees 1,443,402 1,311,000 1,314,400 3, % Other Operating Revenue 1,167,628 1,045,000 1,048,000 3, % Total Operating Revenue $ 99,483,335 $ 101,509,000 $ 101,419,000 $ (90,000) -0.1% Non-Operating Revenues TABLE 2 - OPERATING FUND REVENUE Interest Income $ 703,811 $ 372,900 $ 459,400 $ 86, % Property Rental 575, , , % Other Non-Operating 12,156 12,000 12, % Total Non-Operating $ 1,291,133 $ 952,900 $ 1,039,900 $ 87, % Total Revenue $ 100,774,468 $ 102,461,900 $ 102,458,900 $ (3,000) -0.0% Page

9 Operating Fund Expenses Description Operating Expenses FY'14 Actual FY'15 Budget FY'16 Request Difference Percent Change Salaries & Wages $ 17,931,921 $ 20,250,200 $ 21,559,300 $ 1,309, % Fringe Benefits 7,293,145 8,215,600 8,455, , % Purchased Water 10,195,911 13,299,200 12,916,900 (382,300) -2.9% Purchased Sewer 10,949,400 12,210,000 12,393, , % Contractual Services 3,540,146 4,726,900 4,991, , % Repair & Maintenance 2,309,948 2,876,400 2,920,400 44, % Operating Supplies 4,668,357 5,257,600 5,217,900 (39,700) -0.8% Utilities 3,504,177 3,480,100 3,599, , % Insurance 438, , ,800 16, % Other Operating Expenses 726, , ,700 16, % Total Operating Expenses $ 61,558,806 $ 71,561,800 $ 73,332,300 $ 1,770, % Non-Operating Expenses TABLE 3 - OPERATING FUND EXPENSES Interest Expense $ 3,649,406 $ 3,119,800 $ 2,869,900 $ (249,900) -8.0% Contingency - 500, , % Other Non-Operating 70, , , % Total Non-Operating $ 3,719,776 $ 3,765,200 $ 3,515,300 $ (249,900) -6.6% Total Operating Fund $ 65,278,582 $ 75,327,000 $ 76,847,600 $ 1,520, % Page

10 Replacement Fund Description TABLE 4 - REPLACEMENT FUND BUDGET FY'14 Actual FY'15 Budget FY'16 Request Difference Percent Change Revenue Operating Revenues $ - $ - $ - $ - N/A Interest Income 1,248, , , % Total Revenue $ 1,248,460 $ 898,700 $ 898,700 $ - 0.0% Expenses Contractual Services $ 30,838 $ 88,500 $ 88, % Contingency - 100, , % Total Expenses $ 30,838 $ 188,500 $ 188, % Net Income (excl. Depr.) $ 1,217,622 $ 710,200 $ 710,200 $ - 0.0% Page

11 Expansion & Commitment Fund Description TABLE 5 - EXPANSION & COMMITMENT FUND BUDGET FY'14 Actual FY'15 Budget FY'15 Projected FY'16 Request Difference Percent Change Operating Revenue Operating Revenues $ 1,373,542 $ 1,685,000 $ 1,592,563 $ 1,608,400 $ (76,600) -4.5% Inspection Fees & Revenue 1,794,285 1,389,000 1,498,237 1,410,500 21, % Availability Fees 30,893,962 33,489,000 27,881,003 24,891,600 (8,597,400) -25.7% Interest & Other Income 1,958, ,700 1,487,382 1,092,900 95, % Total Revenue $ 36,019,980 $ 37,560,700 $ 32,459,185 $ 29,003,400 $ (8,557,300) -22.8% Operating Expenses Salaries & Wages $ 2,051,500 $ 2,500,300 $ 2,153,539 $ 2,560,600 $ 60, % Fringe Benefits 780, , , ,600 (22,100) -2.6% Purchased Water 726, , , , % Interest Expense 8,465,133 8,760,400 8,051,285 8,058,600 (701,800) -8.0% Other 477,389 1,753, ,978 1,753,000 (100) -0.0% Contingency - 100, , % Total Expenses $ 12,500,598 $ 14,692,000 $ 12,580,698 $ 14,028,300 $ (663,700) -4.5% Net Income (excl. Depr.) $ 23,519,382 $ 22,868,700 $ 19,878,487 $ 14,975,100 $ (7,893,600) -34.5% Page

12 Capital Budget FY 16 Capital Budget Summary by Type and Fund TABLE 6 - FY'16 CAPITAL BUDGET Funding Source Division/Department Replacement Expansion Total Budget Summary by Type Equipment $ 1,837,000 $ - $ 1,837,000 Computer 730, ,000 Vehicles 359, ,000 Furniture and Fixtures 80,000-80,000 Buildings 165, ,000 Water and Sewer Projects (Under $100K) 825, ,800 Other Total Capital by Type $ 3,996,800 $ - $ 3,996,800 Page

13 FY 16 Adopted Budget Service Authority Performance Increased Efficiency and Accountability To further its mission of providing superior service, the Authority monitors a broad array of performance measures. Steady attention to execution has resulted in improvement in the Authority s productivity and its quality of service. Progress on selected performance measures is tracked in the following charts. The associated efficiency gains positively impact the adopted FY 16 Budget. Chart 1 Abandoned Call Rate Chart 2 Technical Quality Inquiries (Inquiries per 1,000 Customers per Month) 20.0% 18.0% 16.0% 14.0% 12.0% 10.0% 8.0% 6.0% 4.0% 2.0% 0.0% Abandoned call rate has improved significantly over the past three years; averaging 10% in FY 13 and currently averaging less than 2% in FY 15 (see Chart 1). The Authority has made consistent improvement in reducing its technical inquiries. Regular training, additional resources, and a focus on superior service has been a major driver in reducing the number of technical quality inquiries (see Chart 2). Page

14 FY 16 Adopted Budget Increased Efficiency and Accountability (cont d.) Chart 3 Annual Customer Relationship Survey Chart 4 Service Reliability Rate % % % % % % % % % % % The Authority conducts an extensive customer satisfaction survey each year and an ongoing transactional survey to determine how satisfied customers are with their most recent transaction. 8.9 of respondents indicated they were satisfied with the Authority s service as compared to the overall utility industry average of 8.5 satisfaction (see Chart 3). The Authority assesses quality service based on Authority-established objectives and service level targets. It focuses on non-regulatory performance targets technical quality complaint rate (complaints about water pressure, taste and odor and complaints about sewer overflows and odor), valve exercise rate (a measure of how well we are maintaining the water system) and water and sewer service disruption rates (planned and unplanned). Page

15 FY 16 Adopted Budget Operational Effectiveness (cont d) Chart 5 Water Distribution System Integrity (Breaks per 100 Miles per Month) Chart 6 Sewer Overflow Rate (Overflows per 100 Miles per Month) Actual Benchmark Actual Benchmark The Authority continues to meet or exceed regulatory compliance requirements at the water reclamation plant and water distribution and wastewater collection systems. The Authority s performance continues to be in the Top (best) Quartile compared to Qualserve utilities in Wastewater Treatment Effectiveness, Water Quality Compliance, and Technical Quality Complaint Rate, which was significantly reduced compared to last year. The Authority s Sewer Overflow Rate has significantly improved over last year and is now in the Qualserve Top Quartile. In addition, the number of customers out of service longer than 4 hours due to unplanned water disruptions is now in the top Quartile, and the Authority s performance on shorter duration disruptions meets our target. Page

16 FY 16 Adopted Budget A Culture of Savings 14.00% 12.00% 10.00% 8.00% 6.00% 4.00% 2.00% 0.00% Chart 7 Unaccounted for Water (% Loss of Water Purchased and Produced) Water Loss (%) Trend Chart 8 Operating Expenses per Acct. (Inflation Adjusted) $800 $750 $700 $650 $600 $550 $500 Actual Inflation-Adjusted Fiscal Year The volume of unaccounted for water has decreased significantly since FY 06 as the Authority increased its efforts to capture all billable consumption through the hydrant meter program, construction meters for developers, large meter replacement program, the meter exchange program, implementing a leak detection program and increased quality assurance reviews in the billing process (see Chart 7). When adjusted for inflation, actual operating expense per account remains unchanged since FY 06 (see Chart 8). Page

17 FY 16 Adopted Budget Award Winning Service The Service Authority has been recognized on both the national and state levels for overall excellence as well as exceptional operations, safety and financial management programs. For the 25 th consecutive year, the Division of Finance was awarded the GFOA Certificate of Achievement for Excellence in Financial Reporting for the high quality of the PWCSA s Comprehensive Annual Financial Report (CAFR). The Virginia Municipal League (VML) presented PWCSA with their Where the Rubber Meets the Road award for meeting rigorous defensive driving employee training goals. The Authority was awarded the Corporate Safety Award from the American Society of Safety Engineers for demonstrating a commitment to employee safety and health by achieving a DART Incidence Rate below the industry national average. In 2014, PWCSA received NACWA s Platinum Peak Performance Award for outstanding compliance with its discharge permit limits at the H. L. Mooney AWRF for five consecutive years. The Authority has also received the Gold Peak Performance Award for permit compliance seven times. Page