CANBY UTILITY REGULAR BOARD MEETING FEBRUARY 25, :00 P.M.

Transcription

1 CANBY UTILITY REGULAR BOARD MEETING FEBRUARY 25, :00 P.M. I. CALL TO ORDER AGENDA II. III. IV. AGENDA Additions, Deletions or Corrections to the Meeting Agenda CONSENT AGENDA Approval of February 25, 2014 Agenda Approval of Regular Board Meeting Minutes of February 11, 2014 CITIZEN INPUT ON NON-AGENDA ITEMS V. SPECIAL PRESENTATION Chairman Cornelius VI. VII. VIII. BOARD REPORTS Member Maxwell: Knights Bridge Substation Update STAFF REPORTS Finance Manager: 2 nd Quarter Financials (pp. 1-28) Cash Reserves Review and Update General Manager Updates: Mid-Year Key Issues Report (pp ) New Water Rates and Rate Comparison (pp ) ADJOURN

2 CANBY UTILITY REGULAR BOARD MEETING MINUTES FEBRUARY 11, 2014 PRESENT: ALSO PRESENT: Chairman Cornelius; Members Smith, Wagner, Maxwell and Potter; Matt Michel, General Manager; and Barbara Benson, Board Secretary Carol Sullivan, Finance Manager; Sue Arthur, Purchasing Agent; Larry Hepler, Operations Superintendent; Dee Anne Wunder, Customer Service Supervisor; Tim Dale, City Liaison; and Walt Daniels Chairman Cornelius called the Regular Board Meeting to order at 7:00 p.m. Chairman Cornelius presented the meeting agenda for consideration. He asked for any additions, deletions or corrections to the meeting agenda and Matt Michel, General Manager, requested to add staff reports on a legislative update, BPA changes, the Molalla River Alliance, Storm event review and a San Jose substation sniper attack. Chairman Cornelius presented the consent agenda for approval. Member Wagner made the *MOTION to Approve the Consent Agenda, Consisting of the Amended Meeting Agenda, Regular Meeting Minutes of January 28, 2014, Write-Offs in the Amount of $1,754.28, Payment of the Electric and Water Department Bills in the Amount of $705,301.74, with Carry-Ins in the Amount of $71,572.36, for a Total of $776, Member Smith seconded, and the motion passed unanimously. Chairman Cornelius asked for citizen input on non-agenda items and there was none. Dee Anne Wunder, Customer Service Supervisor, presented the final draft of the proposed changes to the customer service policies and procedures. She noted she has made a few changes to the final document from when it was presented to the Board at the last meeting. The changes consisted of current practices that were not in writing. Chairman Cornelius asked how Canby Utility determines whether or not a customer must pay a deposit. Dee Anne explained there are three options to waive the deposit, which includes a soft credit check, a co-signer, or a letter of credit from another utility. Member Maxwell noted that he feels that it is important for new customers to make some form of payment upon applying for service. This would help protect the utility from customers who move out of the service area soon after becoming a new customer. Dee Anne explained how the deposit will be applied. At minimum, one-third of the customer s total deposit amount and the account set-up fee will be collected up front, which should cover the customer s first month utility bill. The deposit is based on a calculation using twice the highest usage for the service address. Member Smith made the *MOTION to Adopt Resolution No. 270, a Resolution Updating Customer Service Policies and Procedures; Repealing Resolution No Member Wagner seconded the motion and the roll call ballot was as follows: Member Smith, aye; Member Wagner, aye; Member Maxwell, aye; Member Potter, aye; and Chairman Cornelius, aye. The motion passed 5 to 0.

3 Canby Utility Regular Board Meeting Minutes February 11, 2014 Page 2 of 3 Matt Michel, General Manager, reported that he has completed the Administration/HR Manager s annual job performance evaluation. He stated that Barb Benson is meeting expectations and will progress to the next salary step. Matt stated that he has provided the quarterly report on his time away from the office to attend utility related meetings in the packet and offered to answer any questions the Board had. Chairman Cornelius thanked him for the information. Member Smith stated that he would like this reporting be discontinued. He felt that the reasons behind why the Board asked for the report have been resolved. Chairman Cornelius stated that the Board would consider whether or not to continue the reporting as part of the General Manager s upcoming job performance evaluation. Matt reported that in the Saturday paper was an article on the Oregon legislature regarding energy mandates that stemmed from server farms landing in the Umatilla Electric Cooperative s service territory. Oregon s renewable portfolio standards mandate a percentage of a utility s kilowatt hour (kwh) sales have an equivalent amount of green power based on size and categorized utilities by small, medium and large. The law also established timelines for compliance. The large server farms that landed in Umatilla s service area pushed their kwh sales into the large utility category. This caused their target amount of 10% green power to increase to 25% by Matt explained how that change in the target amount would affect Umatilla. Umatilla started a ballot measure petition that would have upended the renewable portfolio standard, which prompted negotiations. The resolution is that Umatilla will still progress to the large utility category but instead of having to buy green energy with the green attributes, they can buy any desired type of energy and purchase green credits on the market to meet that standard. In turn, Pacific Power requested that the Public Utility Commission (PUC) clarify that consumer owned utilities can sell a green product to their commercial customers. The PUC will conduct a study to determine the impacts of their request. Matt noted that it doesn t impact Canby Utility and that the long-term ripple effects on the market are uncertain and discussion ensued. Matt presented six pie charts developed by the Public Power Council that illustrated BPA s case reconstruction for their preference hiring issues. The charts focused on the external cases and those who were denied employment. Matt briefly explained what was presented in each chart. He noted that BPA has spent $605,946 of the forecasted $3 million for cost of the human capital management recovery expenditures. Matt announced that the Board recently received a newsletter from the Molalla River Alliance. In that newsletter, Canby Utility is identified as a primary partner. He stated that the Board offered to provide up to $2,000 of support through in-kind services to help the Alliance reconstruct the river bank area and remove an illegal campsite along the Molalla River. Canby Utility s support was offered when the Alliance was seeking a 319 grant through DEQ. Canby Utility s support helps with the watershed protection. Larry Hepler, Operations Superintendent, reported on the recent snow storm. The light powder snow conditions and minimal ice accumulation minimized service issues. He reported a car damaged a light pole along Sequoia Parkway and three tree limbs fell on service lines, which

4 Canby Utility Regular Board Meeting Minutes February 11, 2014 Page 3 of 3 were all addressed during normal work hours. There were no after-hours callouts for the electric department. Chairman Cornelius asked if management had any linemen on emergency standby and Larry replied that he determined that it wasn t necessary. Larry reported the water department had three callouts over the weekend, related to frozen customer pipes. During normal hours, the water crew responded to two locations where builders had exposed excavations that resulted in frozen meters. Chairman Cornelius asked if frozen meters are common in these cold weather events and Larry responded that it doesn t happen often. He explained that in the December cold event, there were a few meters that froze. Larry briefly explained the two different designs of meters we have in our system and how they fail when the freeze occurs. Larry also reported that last April, Pacific Gas & Electric s Metcalf transmission substation was targeted by an organized group of individuals. The substation communications were disabled and then 17 transformers were disabled when they opened fire on them using a high powered rifle. Larry noted that the incident was very well planned out. Larry shared some of the industry s concerns, one of them being the lead-time to order replacement transformers. There have been 274 acts of violence against substations across the country in the past three years. Member Potter asked if following the events of 9/11, were there any requirements for assessment or inventory of the system enacted and Larry responded that there were none for electric; however, it was noted that a vulnerability assessment was mandated for water utilities. Member Wagner asked Larry questions about notifications for when communication systems fail. Larry noted that the FERC inquiries related to the attacks on substations would not impact Canby Utility. Member Smith made the *MOTION to Adjourn the Meeting. Member Maxwell seconded, and the motion passed unanimously. There being no further business, the meeting was adjourned at 7:42 p.m. Bob Cornelius, Chairman Robert Maxwell, Member Gary Potter, Member Jerry Smith, Member Todd Wagner, Member Barbara Benson, Board Secretary

5 Memorandum February 20, 2014 To: From: Subject: Chairperson Cornelius, Member Smith, Member Wagner, Member Maxwell and Member Potter Carol Sullivan, Finance Manager December FY 14 Financial Reports UPDATED NEW FORMAT Please find attached the December FY 14 Financial Reports package. The format of the reports have changed to include more information. I added a chart for the YTD Kwh and cubic feet sold as a percentage of the total. On the cash balances chart I added the cash reserve target, which is represented by a dashed line across the existing cash balances at month end. The list below details the progression of the reports that are included in your package; there is one for electric and one for water. 1) An overview chart of the cumulative YTD revenues and expenses compared to budget. 2) A narrative of the financial highlights for the current month with comparisons to prior year and budget. 3) An overview of the financial data compared to the YTD budget. This report looks at the totals for the different revenue categories, specific expenses accounts (depreciation, franchise taxes and purchased power for electric), totals of expenses by department and the capital contributions. Also shown on the bottom of this report is the units sold, which includes prior month and current month usage. Electric shows the kwh purchased for the current month from BPA and the cost per kwh. 4) Two total revenues charts, one for the month and another for YTD, compared to budget by customer class and also includes other and nonoperating revenue categories. 1

6 5) Two total expenses charts, one for the month and another for YTD, compared to budget for specific expenses accounts (depreciation, franchise taxes and purchased power for electric) and totals of other expenses by department. 6) Three pie charts: YTD revenues, YTD Kwh/cubic feet sold, and YTD expenses, as a percent of the total. 7) The final charts show one for revenue, expense, net asset change actual and net asset change budget for each month and another chart for cash balances at prior fiscal year ends and monthly for the current fiscal year with a dashed line representing the targeted year end cash reserve balance. 8) Balance Sheet - YTD vs. Prior YTD. 9) Statement of Operations and Changes in Net Assets Actual vs. Previous Year. 10) Statement of Operations and Changes in Net Assets Actual vs. Budget. I will be available at the Board meeting to answer any questions that were not anticipated with my report narratives and welcome your feedback on the updated new format. 2

7 OVERVIEW - ELECTRIC FY Cumulative YTD, by Month, Revenue & Expense 12,000,000 10,000,000 8,000,000 6,000,000 4,000,000 2,000,000 - Jul-13 Aug-13 Sep-13 Oct-13 Nov-13 Dec-13 Jan-14 Feb-14 Mar-14 Apr-14 May-14 Jun-14 Budget Expenses Actual Expense Budget Revenues Actual Revenue 3

8 Electric Financial HIGHLIGHTS December 31, 2013 Financial highlights for the month of December include: 1. Monthly kwh sales increased 10.30% from the prior year, while Electric Energy Sales increased 16.60%. Unbudgeted CU rate increase effective October 1, YTD kwh sales increased 2.63% from the prior fiscal year, while Electric Energy Sales increased 5.31%. 3. Electric Energy Sales Revenue for the month is 16.59% over budget. 4. Electric Energy Sales Revenue fiscal YTD is 5.31% over budget. 5. Other Electric Revenue for the month was $8,635 under budget, mainly due to the old policy of door hangers not being hung in December. 6. Interest Income for the month is $224 under budget. The average annualized interest rate last year was 0.60% vs. 0.54% this year. The amount of funds Canby Utility has in Cash and Investments is $6,820,016. The fiscal year end cash reserve was originally estimated to be $6,820,980 but there was no land sale and reserves were adjusted to $6,655,410 after the rate study. 7. Capital Contributions for the month are $3,664 vs. $1,270 last year. 8. Purchased Power & Transmission - Total cost for the month was 29.09% over budget. The YTD cost was 9.97% over budget. Unbudgeted BPA rate increase October 1, Board of Directors - Overall close to budget. 10. Executive - Overall close to budget. 11. Administrative - Under budget $4,006 due to the cumulative effect of all but one item being under budget. 12. Customer Service - Under budget $3,233 mainly due to BPA conservation payouts. 13. Finance - Over budget $153,002 mainly due to the Purchased Power and Transmission bill which was offset slightly by depreciation. 14. O&M - Under budget $6,779 mainly due to lower labor costs and more labor was capitalized. 15. Risk Management - Over budget $644 due to higher than estimated property and liability insurance. 4

9 OVERVIEW - Electric Financials YTD December FY14 Actual Results Jul-13 Aug-13 Sep-13 Oct-13 Nov-13 Dec-13 Jan-14 Feb-14 Mar-14 Apr-14 May-14 Jun-14 Total Budget Revenues: Electric Revenues $ 743,795 $ 821,294 $ 762,491 $ 729,893 $ 862,654 $ 982,640 $ - $ - $ - $ - $ - $ - $ 4,902,767 $ 4,655,495 Other Revenues 30,524 11,417 48,431 15,787 10,129 13, , ,145 Non-Operating Revenue 6,742 8,232 7,471 8,015 7,717 8, ,862 44,470 YTD Total Electric Revenue 781, , , , ,500 1,004, ,079,091 4,832,110 Expenses: Depreciation 50,772 50,794 50,803 50,844 50,872 50, , ,244 Franchise Taxes 37,331 41,206 38,265 36,636 43,273 49, , ,625 Purchased Power 426, , , , , , ,324,225 3,022,898 Customer Service 82,001 35,176 69,661 37,550 38,562 43, , ,802 O&M 63,327 65,301 57,705 52,879 61,365 71, , ,879 Admin. & General 64,706 60,219 63,053 61,006 57,844 66, , ,016 Non-Operating Expense 1, ,392 2, , ,737 6,678 Total Electric Expense 725, , , , ,169 1,025, ,940,097 4,841,142 Net Income/(Loss) 55,382 70,874 26,330 (80,793) 88,331 (21,130) ,994 (9,032) Capital Contributions: Hook-up Fees 1,600 13,982 4,800-45,915 3, ,961 12,000 Contributed by Others Line Extension Fees ,952 Total Capital Contributions 1,600 13,982 4,800-45,915 3, , ,952 Change in Net Assets: Actual $ 56,982 $ 84,856 $ 31,130 $ (80,793) $ 134,246 $ (17,466) $ - $ - $ - $ - $ - $ - $ 208,955 Budget $ 198,012 $ 129,879 $ 191,824 $ (48,409) $ 118,269 $ 107,343 $ 124,438 $ 89,881 $ 40,232 $ (103,262) $ 209,630 $ 123,330 $ 696,920 Energy Statistics: kwh Sold 12,993,126 14,588,929 13,510,147 12,501,708 14,350,503 16,463, ,408,039 kwh Purchased - BPA 14,664,408 14,466,568 13,226,338 14,070,721 15,435,994 19,362, ,226,756 Cost per MWh - BPA (Includes Transmission costs and conservation credit) $ $ $ $ $ $ $ - $ - $ - $ - $ - $ - $

10 Total Electric Revenue December FY14 $1,200,000 $1,000,000 $800,000 $600,000 $400,000 $200,000 Year-To-Date, December FY14 $6,000,000 $5,000,000 $4,000,000 $3,000,000 $2,000,000 $1,000,000 $- Non- Residential Unbilled Green Power Small Comm. Large Comm. Industrial Street Lights Municipal Canby Utility Other Operating Total Actual $575,303 $983 $45,435 $181,178 $154,271 $3,176 $9,780 $12,514 $13,174 $8,685 $1,004,499 Budget $456,799 $- $986 $40,790 $178,524 $142,405 $3,287 $9,979 $10,045 $21,809 $7,211 $871,835 $- Non- Residential Unbilled Green Power Small Comm. Large Comm. Industrial Street Lights Municipal Canby Utility Other Operating Total Actual YTD $2,488,810 $- $5,775 $252,097 $1,141,403 $866,899 $19,455 $56,646 $71,682 $129,462 $46,862 $5,079,091 Budget YTD $2,266,083 $- $6,004 $236,218 $1,138,091 $866,004 $19,827 $55,997 $67,271 $132,145 $44,470 $4,832,110 6

11 Total Electric Expenses December FY14 $1,200,000 $1,000,000 $800,000 $600,000 $400,000 $200,000 $- Depreciation Franchise Taxes Purchased Power Customer Service O&M Admin. & General Non-Operating Total Actual $50,894 $49,273 $737,650 $43,408 $71,258 $66,151 $6,995 $1,025,629 Budget $62,495 $42,283 $571,431 $46,640 $78,037 $78,152 $1,113 $880,151 Year-To-Date, December FY14 $6,000,000 $5,000,000 $4,000,000 $3,000,000 $2,000,000 $1,000,000 $- Depreciation Franchise Taxes Purchased Power Customer Service O&M Admin. & General Non-Operating Total Actual YTD $304,979 $245,984 $3,324,225 $306,358 $371,835 $372,979 $13,737 $4,940,097 Budget YTD $362,244 $233,625 $3,022,898 $315,802 $466,879 $433,016 $6,678 $4,841,142 7

12 Electric Revenues, Kwh and Expenses YTD Electric Revenues YTD, December FY14 As A Percentage Of Total Electric Energy Sales Electric Kwh YTD, December FY14 As A Percentage Of Total Kwh Sold Street Lights 0.38% Industrial 17.07% Municipal 1.12% Canby Utility 1.41% Other 2.55% Non-Operating 0.92% Residential 49.00% Street Lights 0.50% Industrial 20.39% Municipal 1.38% Canby Utility 1.53% Rent 0.07% Residential 43.71% Large Comm % Large Comm % Small Comm. 4.96% Green Power 0.11% Small Comm. 5.78% Green Power 0.74% Electric Expenses YTD, December FY14 As A Percentage Of Total Electric Expenses O&M 7.53% Admin. & General 7.55% Non-Operating 0.28% Depreciation 6.17% Franchise Taxes 4.98% Customer Service 6.20% Purchased Power 67.29% 8

13 YTD Financials Electric Financials, YTD December FY14 Electric Cash Balances & ---- Cash Reserve Target $1,100,000 12,000,000 $1,000,000 $900,000 10,000,000 $800,000 $700,000 8,000,000 $600,000 $500,000 6,000,000 $400,000 $300,000 $200,000 4,000,000 $100,000 $- 2,000,000 $(100,000) $(200,000) Jul-13 Aug-13 Sep-13 Oct-13 Nov-13 Dec-13 Jan-14 Feb-14 Mar-14 Apr-14 May-14 Jun-14 Revenue Revenue includes Contributions in Aid for purposes of this comparison. Expense Net Asset Change Actual - 6/30/2007 6/30/2008 6/30/2009 6/30/2010 6/30/2011 6/30/2012 6/30/2013 7/31/2013 8/31/2013 9/30/ /30/ /30/ /31/2013 Net Asset Change Budget 9

14 Balance Sheet - Electric Current Assets December 31, 2013 Assets This Year YTD Last Year YTD Variance Dollar Variance Percent Cash 379, , (57,319.51) % Allocate Cash to Reserves (6,655,410.00) (5,344,180.00) (1,311,230.00) 24.54% Local Government Investment Pool 6,440, ,477, (1,037,337.02) % Current Accounts Receivable 1,040, , , % Plant Materials & Operating Supplies 885, , , % Prepayments 47, , , % Total Current Assets 2,138, ,275, (2,137,012.74) % Noncurrent Assets Other Deferred Charges 0.00 (41,383.99) 41, % Total Noncurrent Assets 0.00 (41,383.99) 41, % Property Plant and Equipment Property Plant & Equipment in Service 23,911, ,315, , % Accumulated Depreciation (9,735,385.20) (9,107,518.50) (627,866.70) 6.89% Construction Work in Progress 2,953, ,046, ,906, % Total Property Plant and Equipment 17,129, ,255, ,874, % Cash Designated for Future Use Reserve-Emergency , (750,000.00) % Reserve-Capital Improvement ,436, (2,436,472.67) % Reserve-Capital Replacement , (628,447.95) % Rate Stabilization na Future Improvement/Replacement 6,655, ,529, ,126, % Total Cash Designated for Future Use 6,655, ,344, ,311, % Total Assets 25,923, ,833, ,089, % Liabilities and Net Assets Current Liabilities Accounts Payable 880, , , % Customer Deposits 198, , , % Accrued Payroll Taxes Payable (17,322.29) (16,049.53) (1,272.76) 7.93% Accrued Payroll 57, , , % Accrued Employee Leave 92, , , % Other Current & Accrued Liabilities 16, , (818.26) -4.83% Total Current Liabilities 1,227, ,043, , % Noncurrent Liabilities BPA Deferred Credit (15,293.10) (11,195.95) (4,097.15) 36.59% Total Noncurrent Liabilities (15,293.10) (11,195.95) (4,097.15) 36.59% Total Liabilities 1,212, ,032, , % Net Assets - Unrestricted Reserves ,344, (5,344,180.00) % 10

15 Balance Sheet - Electric December 31, 2013 Liabilities and Net Assets This Year YTD Last Year YTD Variance Dollar Variance Percent Unappropriated Retained Earnings 25,983, ,727, ,256, % YTD Net Income(Loss) 138, , (52,958.14) % Capital Contributions 69, , , % Other Equities (1,481,555.00) (1,481,555.00) % Less PP&E, Net (17,129,454.26) (15,255,162.67) 1,874, % Total Net Assets - Unrestricted 7,581, ,546, (964,614.81) % Investment in Capital Assets 17,129, ,255, ,874, % Total Net Assets 24,710, ,801, , % Total Liabilities and Net Assets 25,923, ,833, ,089, % 11

16 Statement of Operations and Changes in Net Assets - Electric December 31, Month Totals Year to Date Totals This Year Last Year Variance Variance This Year Last Year Variance Variance December December Dollar Percent YTD YTD Dollar Percent Operating Revenues Residential Sales 575, , , % 2,488, ,266, , % Green Power Sales (3.68) -0.37% 5, , (229.08) -3.82% Small Commercial 45, , , % 252, , , % Large Commercial 181, , , % 1,141, ,138, , % Industrial 154, , , % 866, , % City Street Lighting 3, , (111.24) -3.38% 19, , (370.07) -1.87% Municipal 9, , (198.17) -1.99% 56, , % Canby Utility 12, , , % 71, , , % Total Electric Energy Sales 982, , , % 4,902, ,655, , % NSF Check Fees % % Reconnect Fees (80.00) % 1, , (1,100.00) % Door Hanger Fees , (1,025.00) % 26, , , % Account Set-up Fee 1, , (875.00) % 14, , % Other Electric Revenues 11, , , % 87, , (6,441.88) -6.87% Total Other Electric Energy Revenues 13, , , % 129, , (4,141.88) -3.10% Total Operating Revenues 995, , , % 5,032, ,789, , % Operating Expenses Board Of Directors % 6, , , % Executive 22, , (826.18) -3.50% 101, , (16,736.84) % Administrative 14, , , % 82, , % Customer Service 43, , , % 306, , (5,946.05) -1.90% Finance 864, , , % 4,046, ,703, , % Operations 25, , , % 134, , , % Distribution 45, , (3,340.25) -6.81% 236, , (57,865.04) % Risk Management 2, , % 11, , , % Total Operating Expenses 1,018, , , % 4,926, ,649, , % Operating Income/(Loss) (22,819.03) 17, (40,678.56) % 105, , (34,006.55) % Operating Margin -2.29% 2.10% 2.10% 2.92% Non-Operating Revenues & Expenses Rental Lights 2, , (20.33) -0.72% 16, , (106.56) -0.63% 12

17 Statement of Operations and Changes in Net Assets - Electric December 31, Month Totals Year to Date Totals This Year Last Year Variance Variance This Year Last Year Variance Variance December December Dollar Percent YTD YTD Dollar Percent St. Light Maint. Sales 2, , na 7, , (1,174.46) % Billed For Dig In's , (2,293.51) % (614.27) 2, (2,907.78) % Custom Work Sales na (545.73) % St. Light Maint. Costs (3,107.23) 0.00 (3,107.23) na (7,727.24) (8,522.83) % Temporary Service (114.15) % 1, (1,547.95) 2, % Interest Income 2, , (1,002.93) % 17, , (6,289.30) % Gain On Disposition of Property (3,800.45) 0.00 (3,800.45) na (1,313.41) 10, (11,718.71) % Other Interest Expense (88.16) (91.40) % (505.40) (540.26) % Total Non-Operating Revenues & Expenses 1, , (7,561.00) % 33, , (18,951.59) % Net Income/(Loss) before Capital Contributions (21,129.73) 27, (48,239.56) % 138, , (52,958.14) % Capital Contributions Electric Hook-up Fees 3, , , % 69, , , % Total Capital Contributions 3, , , % 69, , , % Change in Net Assets (17,465.55) 28, (45,845.76) % 208, , (2,448.88) -1.16% 13

18 Statement of Operations and Changes in Net Assets - Budget - Electric December 31, Month Totals Year to Date Totals This Year Budget Variance Variance This Year Budget Variance Variance December December Dollar Percent YTD YTD Dollar Percent Operating Revenues Residential Sales 575, , , % 2,488, ,266, , % Green Power Sales (3.44) -0.35% 5, , (229.16) -3.82% Small Commercial 45, , , % 252, , , % Large Commercial 181, , , % 1,141, ,138, , % Industrial 154, , , % 866, , % City Street Lighting 3, , (111.37) -3.39% 19, , (371.96) -1.88% Municipal 9, , (198.07) -1.98% 56, , % Canby Utility 12, , , % 71, , , % Total Electric Energy Sales 982, , , % 4,902, ,655, , % NSF Check Fees % (147.00) % Reconnect Fees (244.00) % 1, , (529.00) % Door Hanger Fees , (4,696.00) % 26, , (2,276.00) -7.99% Account Set-up Fee 1, , (695.00) % 14, , , % Other Electric Revenues 11, , (3,013.15) % 87, , (1,161.62) -1.31% Total Other Electric Energy Revenues 13, , (8,635.15) % 129, , (2,683.62) -2.03% Total Operating Revenues 995, , , % 5,032, ,787, , % Operating Expenses Board Of Directors % 6, , , % Executive 22, , (122.89) -0.54% 101, , (32,418.37) % Administrative 14, , (4,006.30) % 82, , (20,634.09) % Customer Service 43, , (3,232.58) -6.93% 306, , (9,444.00) -2.99% Finance 864, , , % 4,046, ,802, , % Operations 25, , , % 134, , (5,824.30) -4.14% Distribution 45, , (8,397.09) % 236, , (89,220.36) % Risk Management 2, , % 11, , , % Total Operating Expenses 1,018, , , % 4,926, ,834, , % Operating Income/(Loss) (22,819.03) (14,413.61) (8,405.42) % 105, (46,824.13) 152, % Operating Margin -2.29% -1.67% 2.10% -0.98% Non-Operating Revenues & Expenses Rental Lights 2, , (20.00) -0.71% 16, , (93.40) -0.55% 14

19 Statement of Operations and Changes in Net Assets - Budget - Electric December 31, Month Totals Year to Date Totals This Year Budget Variance Variance This Year Budget Variance Variance December December Dollar Percent YTD YTD Dollar Percent St. Light Maint. Sales 2, , % 7, , , % Material Sales (42.00) % (252.00) % Billed For Dig In's (167.00) % (614.27) 1, (1,616.27) % Custom Work Sales (83.00) % (498.00) % Material Sales Costs 0.00 (42.00) % 0.00 (252.00) % Custom Work Costs 0.00 (83.00) % 0.00 (498.00) % St. Light Maint. Costs (3,107.23) (900.00) (2,207.23) % (7,727.24) (5,400.00) (2,327.24) 43.10% Temporary Service na 1, , na Interest Income 2, , (224.07) -7.04% 17, , (1,976.23) -9.98% Gain On Disposition of Property (3,800.45) 0.00 (3,800.45) na (1,313.41) (1,813.41) % Other Interest Expense (88.16) (88.00) (0.16) 0.18% (505.40) (528.00) % Total Non-Operating Revenues & Expenses 1, , (4,408.70) % 33, , (4,667.37) % Net Income/(Loss) before Capital Contributions (21,129.73) (8,315.61) (12,814.12) % 138, (9,032.13) 148, ,638.88% Capital Contributions Electric Hook-up Fees 3, , na 69, , , % Contributed by Others na , (200,522.00) % Line Extension Fees , (115,659.00) % , (493,430.00) % Total Capital Contributions 3, , (111,994.82) % 69, , (635,991.18) % Change in Net Assets (17,465.55) 107, (124,808.94) % 208, , (487,965.18) % 15

20 OVERVIEW - WATER FY Cumulative YTD, by Month, Revenue & Expenses 3,000,000 2,500,000 2,000,000 1,500,000 1,000, ,000 - Jul-13 Aug-13 Sep-13 Oct-13 Nov-13 Dec-13 Jan-14 Feb-14 Mar-14 Apr-14 May-14 Jun-14 Budget Expenses Actual Expense Budget Revenues Actual Revenue 16

21 Water Financial HIGHLIGHTS December 31, 2013 Financial highlights for the month of December include: 1. Monthly Water sales (in cubic feet) decreased 1.91% from the prior year, while Water Usage Sales Revenue increased 12.47%. 2. YTD Water sales (in cubic feet) decreased 5.08% from the prior fiscal year, while Water Usage Sales Revenue increased 3.49%. 3. Water Usage Sales Revenue for the month is 0.76% under budget. 4. Water Usage Sales Revenue fiscal YTD is 1.36% over budget. 5. Interest Income for the month is $92 under budget. The average annualized interest rate last year was 0.60% vs. 0.54% this year. The amount of funds Canby Utility has in Cash and Investments is $2,115,153. The fiscal year end cash reserve is estimated to be $1,986, Interest Expense - Increased $2,481 from last year mainly due to less interest being capitalized which is offset slightly by lower principle balances on bonds. 7. Capital Contributions for the month - $19,498 for this year vs. $0. 8. Board of Directors - Overall close to budget. 9. Executive - Overall close to budget. 10. Administrative - Under budget $1,261 due to the cumulative effect of all but one item being under budget. 11. Customer Service - Overall close to budget. 12. Finance - Overall close to budget. 13. O&M - Under budget $2,853 mainly due to lower labor costs. 14. Water Treatment Plant - Overall close to budget. 15. Risk Management - Over budget $223 due to higher than estimated property and liability insurance. 17

22 OVERVIEW - Water Financials YTD December FY14 Actual Results Jul-13 Aug-13 Sep-13 Oct-13 Nov-13 Dec-13 Jan-14 Feb-14 Mar-14 Apr-14 May-14 Jun-14 Total Budget Revenues: Water Revenues $ 267,239 $ 366,137 $ 256,745 $ 174,816 $ 161,862 $ 145,357 $ - $ - $ - $ - $ - $ - $ 1,372,156 $ 1,353,692 Other Revenues Non-Operating Revenue 3, ,653 2, , ,255 11,077 YTD Total Water Revenue 271, , , , , , ,390,411 1,364,769 Expenses: Depreciation 49,957 49,985 50,011 50,032 50,079 50, , ,932 Franchise Taxes 13,362 18,307 12,837 8,741 8,093 7, ,608 67,685 Customer Service 21,763 10,536 11,222 9,881 11,154 10, ,156 75,367 O&M 39,119 36,151 37,215 31,154 40,756 42, , ,341 Water Treatment Plant 65,340 69,892 69,892 64,980 75,374 65, , ,027 Admin. & General 23,786 14,780 22,763 22,891 20,404 19, , ,717 Non-Operating Expense 15,902 15,891 21,179 15,118 15,367 15, ,574 94,776 Total Water Expense 229, , , , , , ,304,090 1,344,845 Net Income/(Loss) 41, ,508 40,279 (25,665) (58,572) (63,102) ,321 19,924 Capital Contributions: Hook-up Fees , ,708 2,250 Contributed by Others - 4,530-17, ,340 - SDC Fees 3,409 20,454 10,227 3,409 16,362 18, ,269 49,995 Total Capital Contributions 3,559 25,884 10,677 21,369 17,330 19, ,317 52,245 Change in Net Assets: Actual $ 45,432 $ 177,392 $ 50,956 $ (4,296) $ (41,242) $ (43,604) $ - $ - $ - $ - $ - $ - $ 184,638 Budget $ 26,158 $ 80,460 $ 99,785 $ (9,987) $ (57,224) $ (67,023) $ (63,415) $ (62,414) $ (56,930) $ (57,405) $ (17,338) $ (14,863) $ 72,169 Water Usage: Cubic Feet Sold 10,658,598 15,505,782 10,171,215 6,110,815 5,403,919 4,388, ,239,042 18

23 Total Water Revenues $160,000 December FY ,747,280 13,272,040 12,484,621 14,136,940 15,278,137 15,062,510 15,433, $140,000 $120,000 $100,000 $80,000 $60,000 $40,000 $20,000 $- Residential Unbilled Commercial Industrial Municipal Multi-Family Irrigation Other Non-Operating Total Actual $91,438 $- $17,461 $2,116 $1,445 $31,244 $1,652 $- $1,717 $147,073 Budget $92,645 $- $17,997 $2,067 $2,404 $30,126 $1,233 $- $1,103 $147,575 Year-To-Date, December FY14 $1,600,000 $1,400,000 $1,200,000 $1,000,000 $800,000 $600,000 $400,000 $200,000 $- Residential Unbilled Commercial Industrial Municipal Multi-Family Irrigation Other Non-Operating Total Actual YTD $871,408 $- $165,596 $17,873 $13,805 $248,138 $55,335 $- $18,255 $1,390,410 Budget YTD $886,189 $- $153,534 $17,770 $14,614 $229,559 $52,026 $- $11,077 $1,364,769 19

24 Total Water Expenses December FY14 $250,000 $200,000 $150,000 $100,000 $50,000 $- Depreciation Franchise Taxes Customer Service O&M WTP Admin. & General Non-Operating Total Actual $50,099 $7,268 $10,600 $42,355 $65,540 $19,197 $15,117 $210,176 Budget $49,829 $7,324 $10,592 $45,208 $65,142 $21,093 $15,410 $214,598 Year-To-Date, December FY14 $1,600,000 $1,400,000 $1,200,000 $1,000,000 $800,000 $600,000 $400,000 $200,000 $- Depreciation Franchise Taxes Customer Service O&M WTP Admin. & General Non-Operating Total Actual YTD $300,163 $68,608 $75,156 $226,750 $411,018 $123,821 $98,574 $1,304,090 Budget YTD $296,932 $67,685 $75,367 $277,341 $396,027 $136,717 $94,776 $1,344,845 20

25 Water Revenues, Cubic Feet and Expenses YTD Water Revenues YTD, December FY14 As A Percentage Of Total Water Usage Sales Water Cubic Feet YTD, December FY14 As A Percentage Of Total Cubic Feet Sold Municipal 0.99% Multi-Family 17.85% Industrial 1.29% Commercial 11.91% Irrigation 3.98% Other 0.00% Non-Operating 1.31% Residential 62.67% Municipal 1.38% Industrial 2.07% Commercial 12.88% Multi-Family 20.36% Irrigation 3.80% Residential 59.50% Water Expenses YTD, December FY14 As A Percentage Of Total Water Expenses Admin. & General 9.49% Non-Operating 7.56% Depreciation 23.02% Franchise Taxes 5.26% WTP 31.52% Customer Service 5.76% O&M 17.39% 21

26 YTD Financials $500,000 Water Financials, YTD December FY14 Water Cash Balances & ---- Cash Reserve Target 8,000,000 $400,000 7,000,000 6,000,000 $300,000 5,000,000 $200,000 4,000,000 $100,000 3,000,000 2,000,000 $- 1,000,000 $(100,000) Jul-13 Aug-13 Sep-13 Oct-13 Nov-13 Dec-13 Jan-14 Feb-14 Mar-14 Apr-14 May-14 Jun-14 Revenue Expense For purposes of this comparison, Revenue includes Contributions In Aid. Net Asset Change Actual - 6/30/2007 6/30/2008 6/30/2009 6/30/2010 6/30/2011 6/30/2012 6/30/2013 7/1/2013 8/31/2013 9/30/ /31/ /30/ /31/2013 Net Asset Change Budget 22

27 Balance Sheet - Water Current Assets December 31, 2013 Assets This Year YTD Last Year YTD Variance Dollar Variance Percent Cash 343, (43,747.84) 387, % Allocate Cash to Reserves (2,058,770.50) (2,125,397.50) 66, % Local Government Investment Pool 1,771, ,121, (350,178.51) % Current Accounts Receivable 260, , , % Plant Materials & Operating Supplies 251, , (218,937.43) % Prepayments 27, , , % Total Current Assets 596, , (70,076.57) % Noncurrent Assets Other Deferred Charges 2, , (20,111.06) % Total Noncurrent Assets 2, , (20,111.06) % Property Plant and Equipment Property Plant & Equipment in Service 28,103, ,183, ,919, % Accumulated Depreciation (8,210,643.25) (7,691,993.70) (518,649.55) 6.74% Construction Work in Progress 104, ,293, (1,188,813.67) % Total Property Plant and Equipment 19,996, ,785, , % Cash Designated for Future Use Bond Reserve Requirement na Reserve-SDC 72, , , % Reserve-Capital Improvement , (118,055.00) % Reserve-Capital Replacement ,229, (1,229,548.00) % Future Improvement/Replacement 1,986, , ,240, % Total Cash Designated for Future Use 2,058, ,125, (66,627.00) -3.13% Total Assets 22,654, ,599, , % Liabilities and Net Assets Current Liabilities Accounts Payable 24, , (195,348.32) % Sewer Collections Payable na Accrued Interest 44, , (2,315.66) -4.95% Accrued Payroll Taxes Payable (2,923.11) (3,305.21) % Accrued Payroll 19, , (3,076.48) % Accrued Employee Leave 15, , (8,190.06) % Other Current & Accrued Liabilities (2,047.26) 1, (3,208.76) % Total Current Liabilities 99, , (211,757.18) % Noncurrent Liabilities Bonds Payable 4,370, ,630, (260,000.00) -5.62% Total Noncurrent Liabilities 4,370, ,630, (260,000.00) -5.62% Total Liabilities 4,469, ,941, (471,757.18) -9.55% Net Assets - Unrestricted 23

28 Balance Sheet - Water December 31, 2013 Liabilities and Net Assets This Year YTD Last Year YTD Variance Dollar Variance Percent Reserves ,371, (2,371,095.47) % Unappropriated Retained Earnings 16,515, ,409, ,105, % YTD Net Income(Loss) 86, , (51,256.52) % Capital Contributions 98, , (156,247.28) % Other Equities 1,485, ,485, (308.61) -0.02% Less PP&E, Net (19,996,903.45) (19,785,034.96) 211, % Total Net Assets - Unrestricted (1,811,268.40) (2,126,210.95) 314, % Investment in Capital Assets 19,996, ,785, , % Total Net Assets 18,185, ,658, , % Total Liabilities and Net Assets 22,654, ,599, , % 24

29 Statement of Operations and Changes in Net Assets - Water December 31, Month Totals Year to Date Totals This Year Last Year Variance Variance This Year Last Year Variance Variance December December Dollar Percent YTD YTD Dollar Percent Operating Revenues Residential 91, , , % 871, , , % Commercial 17, , , % 165, , , % Industrial 2, , % 17, , % Municipal 1, , (220.61) % 13, , (642.25) -4.45% Multi-Family 31, , , % 248, , , % Irrigation/Hydrant 1, , % 55, , (4,640.55) -7.74% Total Water Usage Sales 145, , , % 1,372, ,325, , % Total Other Water Revenues na na Total Operating Revenues 145, , , % 1,372, ,325, , % Operating Expenses Board Of Directors % 2, , % Executive 4, , (1,638.03) % 26, , (3,219.75) % Administrative 5, , % 32, , % Customer Service 10, , (355.91) -3.25% 75, , (1,387.16) -1.81% Finance 64, , , % 423, , , % Operations 7, , % 43, , , % Distribution 34, , , % 183, , , % Water Treatment Plant 65, , , % 406, , , % Risk Management 2, , % 12, , , % Total Operating Expenses 195, , , % 1,205, ,113, , % Operating Income/(Loss) (49,702.23) (45,106.40) (4,595.83) % 166, , (45,755.36) % Operating Margin % % 12.14% 16.02% Non-Operating Revenues & Expenses Material Sales na , (7,829.00) % Billed For Dig In's na 3, (593.51) 3, % Custom Work Sales na (115.09) 0.00 (115.09) na Misc. Other Sales & Income na na Inspection Fees na 2, , na Material Sales Costs na 0.00 (8,609.12) 8, % 25

30 Statement of Operations and Changes in Net Assets - Water December 31, Month Totals Year to Date Totals This Year Last Year Variance Variance This Year Last Year Variance Variance December December Dollar Percent YTD YTD Dollar Percent Inspection Fees Cost na (5,174.13) 0.00 (5,174.13) na Interest Income , (244.23) % 4, , (2,927.86) % Gain On Disposition of Property na 7, , % Loss On Disposition of Property na na Other Deductions (479.21) (479.21) % (3,125.26) (3,125.26) % Interest Expense (14,638.39) (12,157.18) (2,481.21) 20.41% (90,162.15) (85,320.28) (4,841.87) 5.67% Total Non-Operating Revenues & Expenses (13,400.20) (11,571.67) (1,828.53) 15.80% (80,319.30) (74,818.14) (5,501.16) 7.35% Net Income/(Loss) before Capital Contributions (63,102.43) (56,678.07) (6,424.36) 11.33% 86, , (51,256.52) % Capital Contributions Water Hook-up Fees 1, , na 3, , , % Contributed by Others na 22, , (199,668.28) % SDC Fees 18, , na 72, , , % Total Capital Contributions 19, , na 98, , (156,247.28) % Change in Net Assets (43,604.43) (56,678.07) 13, % 184, , (207,503.80) % 26

31 Statement of Operations and Changes in Net Assets - Budget - Water December 31, Month Totals Year to Date Totals This Year Budget Variance Variance This Year Budget Variance Variance December December Dollar Percent YTD YTD Dollar Percent Operating Revenues Residential 91, , (1,206.92) -1.30% 871, , (14,781.48) -1.67% Commercial 17, , (535.77) -2.98% 165, , , % Industrial 2, , % 17, , % Municipal 1, , (959.13) % 13, , (808.75) -5.53% Multi-Family 31, , , % 248, , , % Irrigation/Hydrant 1, , % 55, , , % Total Water Usage Sales 145, , (1,115.20) -0.76% 1,372, ,353, , % Total Other Water Revenues na na Total Operating Revenues 145, , (1,115.20) -0.76% 1,372, ,353, , % Operating Expenses Board Of Directors (36.43) % 2, , % Executive 4, , (198.36) -4.60% 26, , (1,953.76) -6.90% Administrative 5, , (1,261.49) % 32, , (8,559.75) % Customer Service 10, , % 75, , (210.38) -0.28% Finance 64, , (407.97) -0.63% 423, , , % Operations 7, , % 43, , (3,309.58) -7.09% Distribution 34, , (2,888.13) -7.73% 183, , (47,280.58) % Water Treatment Plant 65, , % 406, , , % Risk Management 2, , % 12, , % Total Operating Expenses 195, , (4,128.63) -2.07% 1,205, ,250, (44,552.07) -3.56% Operating Income/(Loss) (49,702.23) (52,715.66) 3, % 166, , , % Operating Margin % % 12.14% 7.65% Non-Operating Revenues & Expenses Material Sales (15.00) % (90.00) % Billed For Dig In's (50.00) % 3, , % Custom Work Sales (42.00) % (115.09) (367.09) % Misc. Other Sales & Income na na Inspection Fees (83.00) % 2, , % Material Sales Costs 0.00 (15.00) % 0.00 (90.00) % 27

32 Statement of Operations and Changes in Net Assets - Budget - Water December 31, Month Totals Year to Date Totals This Year Budget Variance Variance This Year Budget Variance Variance December December Dollar Percent YTD YTD Dollar Percent Inspection Fees Cost 0.00 (83.00) % (5,174.13) (498.00) (4,676.13) % Interest Income (92.51) % 4, , (567.74) % Gain On Disposition of Property na 7, , , % Loss On Disposition of Property na na Other Deductions (479.21) (479.00) (0.21) 0.04% (3,125.26) (2,874.00) (251.26) 8.74% Interest Expense (14,638.39) (14,833.00) % (90,162.15) (91,314.00) 1, % Total Non-Operating Revenues & Expenses (13,400.20) (14,307.00) % (80,319.30) (83,699.00) 3, % Net Income/(Loss) before Capital Contributions (63,102.43) (67,022.66) 3, % 86, , , % Capital Contributions Water Hook-up Fees 1, , na 3, , , % Contributed by Others na 22, , na SDC Fees 18, , na 72, , , % Total Capital Contributions 19, , na 98, , , % Change in Net Assets (43,604.43) (67,022.66) 23, % 184, , , % 28