RECEIVED for the RECORD DOCUMENTS - April 5 & 10, 2019

Transcription

1 RECEIVED for the RECORD DOCUMENTS - April 5 & 10, 2019 BOARD OF WATER SUPPLY of the COUNTY OF KAUA'I FINANCE COMMITTEE MEETING Board Room, Second Floor, Kaua'i County Department of Water 4398 Pua Loke Street, Līhu'e, Kaua'i, Hawai'i DEPARTMENT BUDGET REVIEWS Monday, April 1, 2019 Friday, April 5, 2019 Wednesday, April 10, 2019 Monday, April 15, :30 pm 4:30 pm or shortly thereafter 1:30 pm 4:30 pm or shortly thereafter 1:30 pm 4:30 pm or shortly thereafter 2:30 pm 4:30 pm or shortly thereafter The Finance Committee of the Board of Water Supply will follow this schedule in reviewing, deliberating, and preliminary decision-making on the annual budget for fiscal year of the Department of Water. Meeting dates after the initial meeting are a continuation of the initial meeting and may be canceled. A. CALL TO ORDER B. ROLL CALL C. ACCEPTANCE OF AGENDA D. OLD BUSINESS AGENDA E. NEW BUSINESS 1. Draft Budget for Fiscal Year a. Fiscal Year Draft Operating Budget b. Fiscal Year Draft Capital Outlay Budget F. ADJOURNMENT This notice has been physically posted at the following locations: Council Services, Board of Water Meeting Room, and the Department of Water Lobby This notice has been electronically posted on the Department of Water website: and on the County of Kaua i calendar at (This notice is not subject to the filing requirements of HRS Sec ) NOTE: If you need an auxiliary aid/service or other accommodation due to a disability, contact Edie Ignacio-Neumiller at as soon as possible. Requests made as early as possible will allow adequate time to fulfill your request. Upon request this notice is available in alternate formats such as large print, Braille, or electronic copy. To request an alternate format please eineumiller@kauaiwater.org. Page 1 of 1

2

3

4

5

6

7

8

9

10

11 RECEIVED for the RECORD April 10, 2019 Rev: 4/9/19 FINANCE COMMITTEE MEETING ACTION ITEMS BOARD OF WATER SUPPLY Monday, April 1, 2019 Manager s Report General comments: Rate study will be presented to the Finance Committee then presented to the full Board the next 4 months. Department plans to implement a 5% rate increase by August 1, 2019 Approval of the rate increase need to be presented by the Finance Committee and approved by the Board by the July 26 th Board Meeting at the latest. If rate increase doesn t reach what is projected, the budget will need to be revisited. Projected Revenues p. 9 Proposed 5 new positions Finance Committee will present to the Board approvals of these positions. Three positions are Construction Management that were approved by the Board at the March 22 nd meeting. p. 12 Operation s new vehicles to be discussed in the divisions report. Surface Water Treatment Plant delivery agreement with Grove Farm to be explained later. p.14 Fund Balance Projections Purpose of the Water Utility (WU) Emergency Reserve is kept for a proper working Fund Balance. The Fund Balance should be kept for 3 to 4 months and which is conservative in the General Fund. p. 15 Operating Expenses - Cut back in other Operating Expenses. Revisit the Emergency Reserve Fund possibly as a hybrid. Provide a recommendation on what is a healthy Fund Balance to keep in the WU Fund. Revenue Summary p. 17 Professional Services Explain why is the budget higher than Actuals Expenses? Insurance This is a policy call that the Board can address on the $1M deductible or keep it on the side. p. 21 Professional Services General with Divisions - Do better to set realist budget or sign contracts because the numbers are far off every year. p. 23 Correct WU Should be Construction Water Resources & Planning (not Admin. Meeting Expense). p. 25 New Capital Outlay Summary (Furniture/Fixtures/Equipment/IT) p. 26 Expansion - Correct right column Anticipated NTPs for Paua Valley Tank Repair should be August/September NTP (not PP #1) and Kīlauea 1 & 2 MCC should be December NTP (not PP #5). p. 27 Hanapēpē Bridge - Pending a bill from the State for $315,000. p. 28 WU Water Use Sales $27,253,451 based on meter consumption projected. Finance Committee Meeting Action Items Page 1

12 p. 29 Revenues/Water Sales Projections FY Take the average 4 months in 2019 to equal $300,000 (November, December January February) to be used for the new projection of revenues. Department will investigate the 9% decrease in consumption. Admin. p. 32 Correct Rehab and Replacement/PPE should be FFE Expansion PPE should be FFE (for vehicles; see p. 51) ACTION ITEM: estimate the projected amount of rollover expected (Tess) p. 33 Professional Services/General - Bring back the Performance Audit Hearings Officer may be used for possible future contested cases. p. 39 Kōloa Wells 16 A, B, &E The department will need to do a retroactive lease agreement with Grove Farm. p. 43 The Department needs to be consistent with the County regarding P.O. License Dues. ACTION ITEM: MCE to confirm payment of license dues is consistent with Countywide practice p. 46 Project WET should be referred to as a workshop vs. conference p. 48 Travel 2 staff to attend American Planning Association conference. Water Resources & Planning (WR&P) p. 114 Ongoing Program Measures / Status: #9 UH Projecting future Rainfall and Evapotranspiration for Kaua'i On-going #8 Kaua'i Water Use & Development Plan Update WR&P will come back to the Board for an amendment time extension and an increase in funding on issues outside of the scope 1 year to 1-1/2 years ACTION ITEM: Provide when the last update of water use and development plan occurred and what are the timing requirements. #7 USGS Groundwater Monitoring Program On-going permanently #6 USGS Stream Flow Study On-going #5 Hydraulic Model Update Project On-going (license needs to be procured) p. 116 Kaua'i Watershed Alliance (KWA) Department will provide the KWA past funding request amounts. Department will request KWA present KWA s reason for their request on the additional funds from $200,000 to $220,000 by the April or May Board meeting. This allows time to make budget revisions, if any. p. 121 Meeting Expense would be transferred back to p. 119 Training and Development. ACTION ITEM: ensure the budget proposal is consistent with the following: conducting the business of the Department (meetings) is separate from the education of the Department (attending seminars, workshops, and conferences) NOTE: All the divisions should be prepared to go through punch list items (items the Committee has requested changes on) at the third Finance Committee meeting on April 10 th. Finance Committee Meeting Action Items Page 2

13 RECEIVED for the RECORD April 10, 2019 FINANCE COMMITTEE MEETING ACTION ITEMS BOARD OF WATER SUPPLY Wednesday, April 5, 2019 Information Technology (IT) p. 55 & 56 Contingency should be changed to Unanticipated Costs p. 64 ACTION ITEMS: Provide a brief presentation in memo form itemized: 1) Share Point upgrade line item. Include FT staffing person dedicated to Share Point. 2) Staffing: o Provide Table of Organization for existing & proposed for IT o Follow up on reduction in overtime (OT) costs based on the new FT position. o Provide bench marking details and benchmarking comparison with other water companies in Hawai'i 3) $705,000 new asset management software o Provide estimate (IT stated consultant was gathering info to provide a quote) o Based on the Consultant s quote, update the projected line item dollar figure o Communicate with County re: accessibility between systems 4) $270,000 SCADA Upgrade & Replacement of Servers - o Initially budgeted at $500,000 but reduced to $270,000 based on the IT Strategic Plan recommendation. 5) p Mhz Radios: provide updated actuals ($61,000) Engineering p Limahuli and Mānoa Stream repairs: update New Request? column p. 88 U.H. Experimental Station Tank land acquisition $150,000 is not expected to be used next year. Remove $150,000 from budget. Construction Management (CM) p. 105 Remove line item Truck (2); it s on p. 106 for $90,000 Operations p. 167 $1.6M cost Water Treatment Delivery Agreement with Grove Farm is a replacement cost for the treatment plant as a shared expense (2/3, 1/3 split). (Bryan) ACTION ITEMS: 1) Keep this in the budget 2) Provide justification on the request at the April RBM; prepare for a robust discussion with the Board p. 181 AMI Meter Pilot tests (1000 $250 each) ACTION ITEMS: 1) Determine if the Department will spend $250,000 this year or next year. (Val) 2) If this is for this fiscal year, remove it from the budget. p. 188 Expansion/Equipment ACTION ITEM: 1) Show Board the maintenance schedule for remote sites going forward. (Val) Finance Committee Meeting Action Items Page 1

14 Fiscal p. 122 Budget Request: Request for a new position, Assistant Waterworks Controller ACTION ITEMS: 1) Show the full Board strong justification in details to be presented at the April or May Board meeting. 2) Keep the $75,624 in the budget for now pending discussion. p.138 Professional Services ACTION ITEMS: 1) Consulting Services is being worked on. Targeting within the next 3 months, if the contracted is executed in time, $150,000 will be removed from the budget. Insurance Deductible follow-up: A Board Policy on the Insurance Deductible as a Reserve instead of budgeting $1M every year will be prepared for the April Board meeting. (Bryan) Received for the Record various financial studies from Mr. Hall Parrott to provide Edie copies (at the April 10 th meeting). FOLLOW UP NOTES FOR TESS: Prepare a summary sheet for each Team to identify and show: Positions Vacancies Requests Provide organizational chart for each Team. Finance Committee Meeting Action Items Page 2

15 Fund Balance Projections Water Utility General Fund Fund Balance i;!rojec ions I 1 ' ' Water Utility **Facility State Water Utility Emergency Reserve Bond Fund Revolving TOTAL Debt Reserve Reserve Charge Fund Fund _ Fund Balance Restricted for Unexpended Prior Year (FY2018) Encumbrances_ $19,044,116 $0 $0 $555,756 $5,133,341 $0 $24,733,213 Estimated Change in Fund Balances {FY 2019) $0 $0 $560,611 -$1,689,713 -$1,129,102 Estimated Change in Fund Balances (From State Grants) $ 7,869,595 $0 $0 $0 $7,869,595 Debt Principal Repayment Miscellaneous Capital Purchases - TFFE New Capital Outlay - CIP Reserve Transfers FY 2019 Encumbrances Supplemental Budget# 1 $5,017,034 $0 $0 $0 $5,017,034 $2,348,000 $2,348,000 $3,470,000 $854,670 $5,000,000 $0 $9,324,670 $600,000 -$800,000 $200,000 $0 $0 $0 $0 $20,510,385 $0 $0 $470,246 $3,443,628 $0 ** FRC fund balance is not sufficient to fund the Proposed Capital Outlay - Expansion Projects. An lnterfund transfer through a Manager's Report will be required in order to proceed with any of the FRC Capita! Outlay - Expansion projects. Calculation of DOW Reserves: current budget required balance budget required FY 2018 EMERGENCY Reserve"' 25% of Operating Expenses net of Depreciation/Amortization & Interest Expense DSR"' 50% of annual DSR budget 26,988, ,285, $6,747,237 $800,000 $4,142,541 $ 20 0, 00 0 $600,000 FY Budget SummafY Fund Balance Projections 4/10/ of 14

16

17

18

19

20

21

22

23

24

25

26

27

28

29

30

31

32

33

34

35

36

37

38

39

40

41

42

43

44

45

46

47

48

49

50

51

52

53

54

55

56

57

58

59