AGENDA. 3 - Adoption of a Resolution of Commendation of Mike Yeraka by the Board of Directors of Diablo Water District.

Transcription

1 January 18, Carol Lane P.O. Box 127 Oakley, CA Fax Directors: Edward Garcia President John H. de Fremery Vice President Kenneth L. Crockett Enrico Cinquini Paul Seger General Manager & Secretary: Daniel Muelrath General Counsel: Jeffery D. Polisner AGENDA The Regular Meeting of the Board of Directors of Diablo Water District will be held on Wednesday, January 23, 2019, 7:30 p.m. at the District s office, 87 Carol Lane, Oakley, California. The District s agendas and supporting documents are available at the District s Office located at 87 Carol Lane, Oakley, California, or by calling Christine Belleci at (925) A fee may be charged for copies. Director Garcia will attend the meeting via telephone at the following location: 4110 West Saint Anne Avenue, Phoenix, Arizona If you have a special accommodation needs to attend the meeting, please provide at least two (2) working days notice prior to the meeting by calling Christine Belleci at (925) Pledge of Allegiance. 2 - Public Input. (Anyone present may address the Board of Directors on any subject within the jurisdiction of Diablo Water District. This need not be related to any item on the Agenda.) 3 - Adoption of a Resolution of Commendation of Mike Yeraka by the Board of Directors of Diablo Water District. Staff Recommendation: Adopt Resolution. 4 - Approval of Minutes of the Special Meeting of December 19, Staff Recommendation: Approve Minutes.

2 January 23, 2019 Agenda Page 2 of Public Hearing on the Proposed Water Charges Increase of up to 5.8 Percent for the Average Customer Staff Recommendation: Conduct Public Hearing. 6 - Resolution Amending Regulations Numbered One, Two, Five and Six to Reflect the Current Cost of Service. Staff Recommendation: Adopt Resolution Resolution Amending Regulation Number 105, Deferred Compensation Limits. Staff Recommendation: Adopt Resolution Discussion Items and Reports. General Manager Groundwater Sustainability Agency Outreach Handout Water Supply Charts Press Release Regarding Contra Costa Canal Senate Bill General Counsel Engineer Comments of Directors 9 - Financial Reports. A.) B.) Approval of Warrant Register Numbers A, and A. Receive Monthly Financial Statements.

3 January 23, 2019 Agenda Page 3 of Next Meeting of the Board of Directors. February 27, Adjournment. Posted this 18 th day of January Dan Muelrath, General Manager/Secretary

4 A RESOLUTION OF COMMENDATION OF MIKE YERAKA BY THE BOARD OF DIRECTORS OF DIABLO WATER DISTRICT WHEREAS, Mike Yeraka made a career of public service as an employee of Diablo Water District. Mike began his career with the District on September 21, 1992, after the completion of the Randall-Bold Water Treatment Plant which he was one of the engineers on the project working at Contra Costa Water District. Mike served Diablo Water District for more than 26 years and retired on December 31, WHEREAS, Throughout the 26 years with the District, Mike has lead the District through the design and construction of the Glen Park Well and Pump Station; the Blending Facility; and the 18-Inch waterline connecting them which went into service in July In July 2007, the construction of a 5-Million gallon reservoir began and went into service in July of Immediately, he began the quest researching a second well for the District. The Stone Creek Well, Pump Station, and Pipeline started in April 2010 and went into service in June Also in 2011, the District began the transition of converting the radio read meter system to Advanced Metering Infrastructure meter reading. WHEREAS, Mike envisioned the District having its own administrative building. In 2013, he began the quest of purchasing land, assisting in the design, and was the project manager of the construction of the District s new office building and demonstration garden. The District is no longer paying rent for its offices and will own the building outright in the beginning of WHEREAS, Mike s savvy business sense, invested the District s money in sound investments which helped to fund several projects without increasing the rates for the customers of Oakley. He was instrumental in the refinancing of the 2005 Series Water Revenue Certificates into the 2013 Series Water Revenue Certificates which lowered the amount of interest the District paid out and that savings allowed the District to fund the relocation of the 24-Inch waterline when BNSF Railway installed a second track. The interest saved allowed the District to pay off the side fund liability the District owed to CalPERS. WHEREAS, Mike endured three droughts while General Manager. The last drought in 2015, the District was forced to declare a Water Shortage Emergency. Coincidentally, this occurred at the same time as the District moved from their old office into their new office building. WHEREAS, Mike negotiated countless contracts and agreements always considering what was in the best interest of the District and its employees. Mike negotiated and oversaw the District s transition from Contra Costa County Employees Retirement Association to CalPERS and negotiating a favorable pension plan for District Employees. Mike found the means to open a trust with CalPERS in order to insure the provision of post-employment benefits for District retirees. WHEREAS, Mike was a fair and respected manager with District employees and a trusted advisor to the Board of Directors. Mike has been a teacher, a mentor, a mediator, an advocator, a leader, a co-worker and a friend. The District has been a better place because of his passion for the water industry and his dedication to those he works with at the District and its surrounding agencies. Mike is indeed appreciated and will be missed. THEREFORE BE IT RESOLVED, that the Board of Directors of Diablo Water District does hereby commend and express its appreciation and gratitude to Mike Yeraka for his many years of dedicated and loyal service to Diablo Water District and for the valuable contributions he has made to the success of the District's mission to provide for the public it serves a safe and dependable water supply. BE IT UNANIMOUSLY RESOLVED, that the Board of Directors of Diablo Water District, its employees, and residents do extend to Mike Yeraka their sincere best wishes for a happy and well-deserved retirement and we extend our heartfelt thanks for all his years of service in helping make the District what it is today. Adopted January 23, 2019, at Oakley, California.

5 MINUTES OF THE SPECIAL MEETING OF THE BOARD OF DIRECTORS OF DIABLO WATER DISTRICT HELD ON DECEMBER 19, 2018 The special meeting of the Board of Directors of Diablo Water District was called to order by President Edward Garcia, at the District's office, 87 Carol Lane, Oakley, California at 7:00 p.m. on December 19, ROLL CALL Directors Present: Directors Absent: Staff Present: General Counsel: Consultant: Others Present: Garcia, Crockett, Cinquini, de Fremery, Seger None Mike Yeraka, General Manager Dan Muelrath, Assistant General Manager Jen McCoy, Accounting Operations Manager Jeffrey Polisner Bill Brick, CDM Smith Susan Morgan, Ironhouse Sanitary District; David Soldani, AALR&R; Justin Williams, MUN CPAs; Nancy D Cruz, public PLEDGE OF ALLEGIANCE The Pledge of Allegiance was led by Assistant General Manager Muelrath. ADMINISTER DIABLO WATER DISTRICT DIRECTOR OATH OF OFFICE. As witnessed by President Garcia, Board Secretary/General Manager Yeraka administered the oath of office to the following Directors: Cinquini, Crockett, and Seger. ADOPTION OF RESOLUTION OF APPRECIATION RECOGNIZING THIRTY-TWO AND A HALF YEARS OF SERVICE BY HOWARD HOBBS ON THE DIABLO WATER DISTRICT BOARD OF DIRECTORS. General Manager Yeraka read the resolution of appreciation and was accepted by former Director Hobbs. All Directors expressed appreciation for former Director Hobbs s service to the Board and the community. PUBLIC INPUT Susan Morgan, Ironhouse Sanitary District (Director) congratulated the recently elected/re-elected Directors and thanked former Director Hobbs for his service.

6 Minutes of Special Meeting December 19, 2018 Page 2 APPROVAL OF MINUTES OF THE SPECIAL MEETING OF NOVEMBER 7, 2018, AND THE REGULAR MEETING OF NOVEMBER 28, It was moved by Director Crockett, seconded by Director de Fremery, and unanimously carried to approve the minutes of the special meeting of November 7, 2018, and the regular meeting of November 28, AYES: Garcia, Crockett, Cinquini, and de Fremery NOES: None ABSTAIN: Seger CLOSED SESSION TO CONFER WITH GENERAL COUNSEL REGARDING ANTICIPATED EXPOSUSRE TO LITIGATION AS ALLOWED UNDER GOVERNMENT CODE SECTION At 7:20pm, President Garcia announced that the Board would move into closed session regarding anticipated exposure to litigation as allowed under Government Code Section REPORT ON CLOSED SESSION At 7:43pm, President Garcia reconvened to open session and reported that the Board took no action during closed session. AUTHORIZATION TO EXECUTE ENGAGEMENT LETTER WITH ATKINSON, ANDELSON, LOYA, RUUD & ROMO FOR A FLAT FEE OF $4,200 AND TO ENGAGE COOPERATIVE STRATEGIES FOR A FLAT FEE OF $16,400 PLUS EXPENSES NOT TO EXCEED $2,400 TO PROVIDE VOTING AREA DISTRICTING REPRESENTATION AND CONSULTING SERVICES After discussion, it was moved by Director Crockett, seconded by Director de Fremery, and unanimously carried to execute engagement letter with Atkinson, Andelson, Loya, Ruud & Romo for a flat fee of $4,200 and to engage Cooperative Strategies for a flat fee of $16,400 plus expenses not to exceed $2,400 to provide voting area districting representation and consulting services. ADOPTION OF RESOLUTION DECLARING DIABLO WATER DISTRICT S INTENTION TO TRANSITION FROM AT-LARGE TO BY- DISTRICT ELECTIONS AND ESTABLISHING THE PROCESS FOR TRANSITIONING TO BY-DISTRICT ELECTIONS. It was moved by Director de Fremery, seconded by Director Cinquini, and unanimously carried to adopt Resolution entitled, A Resolution of the Board

7 Minutes of Special Meeting December 19, 2018 Page 3 of Directors of Diablo Water District Declaring Its Intention to Transition from At-Large to By-Division Elections and Establishing the Process for Transitioning to By-Division Elections. ACCEPTANCE OF ANNUAL AUDIT FOR FISCAL YEAR ENDING JUNE 30, 2018 Mr. Williams from MUN CPAs presented the results from the District s annual audit. Results included a clean unmodified opinion of the District s finances. After discussion, it was moved by Director de Fremery, seconded by Director Cinquini, and unanimously carried to accept the annual audit for fiscal year ending June 30, ADOPTION OF PAY RATE SCHEDULE REMOVING THE POSITION OF ASSISTANT GENERAL MANAGER AND UPDATING THE SALARY OF THE GENERAL MANAGER AS REQUIRED BY CALIFORNIA CODE OF REGULATIONS, TITLE 2, SECTIONS AND 571 (b). It was moved by Director Seger, seconded by Director de Fremery, and unanimously carried to adopt pay rate schedule removing the position of Assistant General Manager and updating the salary of the General Manager as required by California Code of Regulation, Title 2, Sections and 571(b). ELECTION OF OFFICERS a. ELECTION OF PRESIDENT Directors Crockett and de Fremery decline the role of President. It was moved by Director de Fremery, seconded by Director Crockett, and unanimously carried to re-appoint Director Garcia as President. b. ELECTION OF VICE PRESIDENT Director Cinquini nominated Director de Fremery as Vice President; the Board unanimously carried to appoint Director de Fremery as Vice President. c. EAST COUNTY WATER MANAGEMENT ASSOCIATION REPRESENTATIVE Director de Fremery nominated Director Crockett; the Board unanimously carried to appoint Director Crockett as the District s East County Water Management Association Representative.

8 Minutes of Special Meeting December 19, 2018 Page 4 d. PUBLIC OUTREACH COMMITTEE REPRESENTATIVE Director de Fremery nominated Director Cinquini and Director Seger; the Board unanimously carried to appoint Director Cinquini and Director Seger as the District s Public Outreach Committee Representatives. ADOPTION OF RESOLUTION AUTHORIZING INVESTMENT OF MONIES IN THE LOCAL AGENCY INVESTMENT FUND It was moved by Director Seger, seconded by Director Cinquini, and unanimously carried to adopt Resolution entitled, A Resolution of the Board of Directors of Diablo Water District Authorizing Investment of Monies in the Local Agency Investment Fund. UPDATE OF MULTI-BANK SECURITIES, INCORPORATED ACCOUNT INFORMATION It was moved by Director de Fremery, seconded by Director Cinquini, and unanimously carried to authorize revisions to Multi-Bank Securities, Incorporated account information to reflect the General Manager/Secretary as, Daniel Muelrath, effective January 1, AUTHORIZATION TO EXECUTE FACILITIES INSTALLATION AGREEMENT WITH WOODCREEK OAKS PETROLEUM, INCORPORATED FOR THE INSTALLATION OF ONE, ONE-AND-ONE-HALF-INCH AND ONE, ONE-INCH WATER SERVICE, FOR THE 2140 LAUREL ROAD ARCO PROJECT, OAKLEY Director Seger expressed concern for the proximity of the gas station to the Contra Costa Water District s canal. President Garcia emphasized the role of the Water District is to supply water to applicants. It was moved by Director de Fremery, seconded by Director Crockett to authorize the General Manager to execute the Facilities Installation Agreement. AYES: Garcia, Crockett, and de Fremery NOES: Seger ABSTAIN: Cinquini

9 Minutes of Special Meeting December 19, 2018 Page 5 AUTHORIZATION TO EXECUTE FACILITIES INSTALLATION AGREEMENT WITH STEPHEN B. COCKMAN, JR. FOR THE INSTALLATION OF THREE, ONE-INCH WATER SERVICES, FOR MINOR SUBDIVISION , 3351 DOYLE ROAD, OAKLEY It was moved by Director Crockett, seconded by Director Cinquini, and unanimously carried to authorize the General Manager to execute the Facilities Installation Agreement. DISCUSSION ITEMS AND REPORTS GENERAL MANAGER Assistant General Manager Muelrath reviewed the District s Continuing Disclosure Policy. General Manager Yeraka reported that the Local Agency Formation Commission, approved the annexation of the Spinnaker Cove Project into Contra Costa Water District s service area. Assistant General Manager Muelrath presented President Garcia and the Board with a letter of appreciation that LAFCO sent on behalf of General Manager Yeraka s upcoming retirement. GENERAL COUNSEL General Counsel expressed appreciation and gratitude regarding General Manager Yeraka s years of service. ENGINEER Mr. Brick presented updates on the Delta Coves Project. COMMENTS OF DIRECTORS All Directors expressed their appreciation for both General Manager Yeraka s and Director Hobbs s service to the District. Director Seger expressed his desire to explore the option of live streaming Board of Directors meetings and having the full Board packets available online. NEXT MEETING OF THE BOARD OF DIRECTORS The next meeting of the Board of Directors is already scheduled for January 23, 2019.

10 Minutes of Special Meeting December 19, 2018 Page 6 APPROVAL OF WARRANT REGISTER NUMBER It was moved by Director Crockett, seconded by Director Cinquini, and unanimously carried to approve Warrant Register Numbers and that warrants numbered through 49041, with the exception of void warrants numbered through be issued as thereon indicated. MONTHLY FINANCIAL REPORT The Monthly Financial Report for the period of November 1, 2018, to November 30, 2018, was issued to each Director along with the November 2018, banking activity as well as a chart depicting Facilities Reserves and General Operating Fund balances for the previous 13 months. ADJOURNMENT It was moved by Director Crockett, seconded by Director Cinquini, and unanimously carried to adjourn the meeting at 9:05 p.m. Respectfully submitted, Dan Muelrath, Secretary

11 DIABLO WATER DISTRICT January 23, 2019 Board Meeting Item Number 4 TO: FROM: Each Director Dan Muelrath, General Manager SUBJECT: Public Hearing on the Proposed Water Charges Increase of up to 5.8% Percent for the Average Customer The attached Notice of Public Hearing on the proposed increase of 5.8% for the average water user was published in the Oakley Press and mailed to all customers and property owners within the District as required by law. The increase is needed due to the February 1, 2019, 7.4% increase in the cost of wholesale water purchased from Contra Costa Water District (CCWD), in addition to the cost of renewal and replacement projects at the 26-year old Randall Bold Water Treatment Plant and increases in water system operation and maintenance costs. Due to structural changes in CCWD s revenue collection model, Diablo Water District s (DWD s) fixed costs are increasing significantly. To recover these fixed costs DWD has proposed to increase the monthly service charge by $5, from $11.61 to $ A portion of this increase to the customer will be offset by lowering the Tier 1 water rate by 4%., which is prudent as CCWD is reducing the volumetric charge to DWD by 6%. With this rate change, the average customer using 400 gallons of water per day would see their monthly bill go up approximately 5.8%, or $3.97 per month from $68.16 to $ DWD s average customers will continue to have the lowest monthly service charge and total water bills compared to neighboring agencies who purchase water from CCWD. Attached is the Water Rate Analysis. As of the date of this staff report, one letter of protest was received. RECOMMENDATION: Conduct Public Hearing. Dan Muelrath General Manager Attached: 1.) Water Rate Analysis - January 10, ) Protest letter(s)

12 Water Rate Analysis Public Hearing Date January 23, 2019 Proposed 5.8% Water Rate Increase for the Average Customer Prepared by: Dan Muelrath General Manager 87 Carol Lane Oakley, CA Phone: (925) Prepared January 10, 2018

13 Acronyms and Abbreviations Used in Water Rate Analysis Public Hearing Date: January 23, 2019 In order to facilitate the understanding of the Water Rate Analysis, the following list of acronyms and abbreviations used throughout this document are listed below. Av Ben Bldg BNSF CalPERS CCWD CERBT COPs Corp DWD EE Elec Equip Exp FRC gpdps GIS GO GP GW HCF Incl Max mgd mil Min Misc Mo O&M OPEB Ops PS RB RBWTP Ret ROW SCADA Sal Tel UAL UWMP VFD WC w/o Average Benefits Building Burlington Northern Santa Fe Railway California Public Employee s Retirement System Contra Costa Water District California Employer s Retiree Benefit Trust Certificates of Participation Corporation Diablo Water District Employee Electrical Equipment Expense Facilities Reserve Charge gallons per day per service Graphic Information System General Operating Glen Park Groundwater Hundred Cubic Feet = 748 gallons Including Maximum million gallons per day million Minimum Miscellaneous Monthly Operations & Maintenance Other Post Employment Benefits Operations Pump Station Randall Bold Randall Bold Water Treatment Plant Retirement Right of Way Supervisory Control and Data Acquisition Salaries Telephone Unfunded Accrued Liability Urban Water Management Plan Variable Frequency Drive Workers Compensation Without 2

14 COST OF SERVICE ANALYSIS AND PROJECTIONS Summary The Diablo Water District (DWD) water rates are established to provide revenue to cover the expenses of the District. The revenues and expenses of the District will vary based on customer consumption rates, system repair requirements, inflation and other variables. In order to determine the water rates required to generate the revenue necessary to cover the expenses of the District, the General Manager developed an Excel based Water Rate Model that has been in use since 2005, portions of which are included in this report. Prior to the end of the calendar year (typically in October) the model is used to tabulate the District s income and expenses for the prior fiscal year and is then refined once the annual audit is completed. It includes the budgeted revenues and expenses for the current fiscal year, and it includes a forecast of revenues and expenses for the following six (6) fiscal years to The model has several variables that can be adjusted while being reviewed with the Diablo Water District Board of Directors and the District s customers during a public hearing, the most significant of which is gallons per day per service (gpdps). This variable has the most dramatic effect on the District s revenue and expenses and varies based on weather and times of drought. In Fiscal Year 2013 District customers used an average of 480 gpdps. During the drought of 2015/2016 customers used an average of 315 gpdps. For 2019, the Water Rate Model uses 400 gpdps, which is a reflection of increased customer demand after the drought restrictions were lifted in District Expenses The historical, budgeted and forecasted expenses of the District to the year 2025 are as indicated on the expense sheet of the Water Rate Model in Appendix A attached. General Operating Expenses The most significant expense of the District is the cost of untreated water purchased from Contra Costa Water District (CCWD), which is approximately 40% of the District s annual operating cost. These costs are expected to go up every year based on anticipated annual CCWD rate increases, which are included in the Water Rate Model. For 2019 CCWD plans on increasing their water rates by 7.4%, which includes a 623% increase in the monthly fixed operation cost portion of DWD s water purchases (their demand charge) and a 6% reduction in the water charge, as noted in Appendix A1 attached. As a result of this change in CCWD s rate structure, the annual demand charge paid to CCWD will go from approximately $75,000/yr to $546,000/yr and the water charge will go from $3.5 mil to $3.3 mil. As a result, DWD will be increasing the monthly service charge from $11.61 to $16.61 in order to generate annual revenue to cover this increase in fixed costs, in addition to covering other fixed costs, but at the same time DWD will be reducing its water charge by 4% on the tier one rate which is billed to all customers. The tier two rate will remain the same as the 2018 rate. 3

15 The amount of water purchased from CCWD is reduced by the anticipated amount of Well Water the District plans on utilizing each year which is currently at 18% of total water into the system. Total water purchased from CCWD is linked to the anticipated gpdps usage by the District s customers. The rest of the District s General Operating Expenses are included in the Water Rate Model and are increased by the anticipated inflation rate each year. Adjustments are also made on a case by case basis. For example, if the District plans to add another employee in a subsequent fiscal year. Or if the District starts to see higher than normal water main repairs and elects to increase the budget to cover these expenses. Salaries in the Rate Model include the anticipated increase in CalPERS retirement costs given the recent decision by CalPERS to reduce the discount rate in their calculations for determining the required employer retirement contributions. The Rate Model also includes the District s unfunded liability as determined by CalPERS. District salaries and benefits are paid partly from the Operating fund and partly from the Facilities Reserve Fund. The portion of employee salaries and benefits paid by the Facilities Reserve fund is in proportion to the time spent by employees working on growth related activities and is reflected in Appendix A2 attached. General Capital & Debt These expenses reflect the continuing debt service obligations of the District. The approximate $1.3 million annual debt service payment for the Randall-Bold Water Treatment Plant is currently paid 38% by existing water users through water rates and 62% through connection fees collected from developers for future users of the Plant. The Water Rate Model calculates for each year the allocation of Plant capacity to current and future users based on actual max month water use averaged over the previous three years in order to provide some smoothing for the irregular water use that may occur from year to year. A similar calculation is performed in the Water Rate Model for the Blending Facility, Stonecreek Well and Glen Park Well in order to allocate the share of annual debt service payments between existing rate payers and new developer connections. Renewal and Replacement These costs reflect reoccurring or one time costs to replace aging infrastructure as well as the Contra Costa County retirement system reconciliation costs. The District relies on information from CCWD for the cost of future Renewal and Replacement projects at the Randall-Bold Water Treatment Plant. Facilities Reserve Expenses Facilities Reserve expenses are shown in the Water Rate Model but are not included in the analysis for determining water rates. These expenses are paid from monies received from developers in the form of connection fees. 4

16 District Revenues The operating revenues of the District are generated through the water charge, monthly service charge and other miscellaneous income as noted in Appendix B attached. Revenue from water sales is based on the gpdps used by the customers and the total number of customers, as well as the Monthly Service Charge. The gpdps is a variable that can be adjusted in the Water Rate Model to reflect current use and anticipated reductions in use such as during times of drought. For 2019, approximately 21% of the District s water related revenues will be derived from the Monthly Service Charge and applied towards a majority of the District s fixed costs for providing water service. The balance of the District s fixed costs and all of the variable costs will be paid from the water charges. Tiered Water Rates The typical average baseline wintertime / indoor water use for the District is 200 gpdps which is equivalent to eight (8) Hundred Cubic Feet (HCF) of water per month. Many of the District s customers use less than 8 HCF even during the summer months. Customers using more than 200 gpdps place higher costs on the District and therefore pay a higher rate for water use over 8 HCF per month. The proposed water charge is $3.22 per HCF (a reduction of 4% from the current 2018 rate of $3.35 per HCF) for the first 8 HCF per month and $3.60 per HCF for water use over 8 HCF per month which is the same as the current 2018 rate. The incremental difference between Tier 1 and Tier 2 is therefore $0.38 per HCF. An example of higher costs being placed on the District for water use over 200 gpdps is the cost of treatment plant capacity. The maximum monthly water use from the Randall- Bold Water Treatment Plant in August 2018, averaged 6.0 million gallons per day (mgd) compared to 2.3 mgd during the month of January 2018, when outside watering is typically turned off. As shown in Table 1 in the back of this report, the annual debt service proportional cost for 6.0 mgd of treatment plant capacity use in the summertime is $551,000. The annual proportional cost of 2.3 mgd of treatment plant capacity use in the wintertime is $211,000. The annual difference in cost that the higher water use customers are placing on the District is $340,000 per annum. If it were not for this incremental higher summertime water use, the District would require less treatment plant capacity and have lower treatment Plant capital costs attributable to existing customers and paid from the water rates. Additional higher incremental costs include the additional staff time and overhead costs associated with the water conservation and water use reduction efforts also noted in Table 1 attributable to customers that use more than 8 HCF per month. If it were not for this higher summertime water use, most if not all of the higher incremental costs could be eliminated. The additional incremental costs total $795,000 and the additional revenue collected from the incremental increase included in the Tier 2 rates over the Tier 1 rates is $148,000 which is less than the incremental costs. 5

17 Revenues for Senior and Disabled Customer Discounts The District provides a 25% discount on the monthly service charge to qualified seniors and disabled customers. Revenue to offset this discount does not come from water rates but is derived from a portion of the rental income received from the leases the District has for three (3) cell sites and the office space it owns at 85 Carol Lane as well as a portion of the income the District receives from Home Serve for service line replacement insurance. The summary of the discount cost and offsetting revenue is as shown in Table 2 at the back of this report. The offsetting revenue far exceeds the discount cost. Included as Appendix C are both the Senior / Low Income Application as well as the Permanent and Totally Disabled low Income Application, which indicate the requirements needed to qualify for the discount. Water Rate Model Attached as Appendix D is the summary page of the District s Water Rate Model. The actual, budget and forecasted General Fund and Facilities Reserve Fund balances on June 30, of each fiscal year are as shown on the summary page chart. General Fund balances are based on water charges and miscellaneous revenues and operating expenses, while Facilities Reserve Fund balances are based on connection fees collected from new connections to the water system and expenses for growth related activities. Board policy includes a provision that the District will target a minimum General Fund balance of $3.9 million which includes a $1.0 million Rate Stabilization Fund. A breakdown of the Reserve minimum balance policy is as indicated in Table 3 below. TABLE 3 General Fund Minimum Reserve Amount Purpose $750,000 Cash shortfalls that may occur during the fiscal year. $750,000 Emergency purposes $1,400,000 5% of the replacement of large depreciated assets $1,000,000 Rate Stabilization Fund Total $3,900,000 The Rate Stabilization Fund was established by the Board of Directors to allow the District to smooth rate increases consistent with the District's long term outlook on water rate setting. Amounts utilized from this fund constitute gross revenues for the fiscal year in which they are utilized. Interest earned on this fund may be withdrawn by the District at it's discretion annually and accounted for as gross revenue. The District has the right at any time to withdraw any or all amounts in this fund for any lawful purpose of the District. There are many variables in the model that can be adjusted to reflect anticipated conditions within the District and perform a sensitivity analysis regarding the assumptions about the variables. 6

18 These variables include: 1) Number of new connections added to the water system each year 2) Average annual consumption in gallons per day per service 3) Anticipated interest rate earnings on investments 4) Anticipated inflation rate Chart 1 in the back of the study depicts the next seven year general fund balance at 400 gpdps in 2019 and 430 gpdps thereafter, while Chart 2 depicts the next seven year general fund balance if consumption continues at 400 gpdps. As can be seen in the charts, consumption of 400 gpdps in 2019 and 430 gpdps thereafter coupled with the proposed 5.8% and anticipated future rate increases allows the District to gradually climb above the minimum General Fund Balance. If water consumption were to be 400 gpdps beyond 2019, the District s General Fund balance would remain below the minimum for an extended period with the effect of not replenishing the Rate Stabilization Fund in a timely manner, placing the District at risk of insufficient funds in the event of another drought, thus requiring additional rate increases in the 2022 time frame. Chart 3 shows how the District s General Fund balance would trend towards bankruptcy if the District did not have the 5.8% rate increase in PROPOSITION 218 NOTIFICATION In accordance with Proposition 218, the District mailed the NOTICE OF PUBLIC HEARING in Appendix E to every land owner and customer receiving water service from the District, on December 4, 2018, providing at least 45 days notice prior to the January 23, 2019, Hearing Date. The Notice provides the Key Reasons for the proposed 5.8% increase in the District s Water Charges. Also included with Appendix E is the Notice of Public Hearing for publication in the Oakley Press on December 7, 2018 and January 11,

19 Appendix A B C D E F P Q R S T U V W X Y EXPENSES FISCAL YEAR ENDING JUNE 30 Actual Actual Actual Budget Forecast Forecast Forecast Forecast Forecast Forecast FY 2015 / 16 FY 2016 / 17 FY 2017 / 18 FY 2018 / 19 FY 2019 / 20 FY 2020 / 21 FY 2021 / 22 FY 2022 / 23 FY 2023 / 24 FY 2024 / 25 Cost of Raw Water per 1,000 gal Demand Charge Effective Average 3 years max Month 168, , , , , , ,298 Demand Charge Total 546, , , , , , , Increase over prev.yr. 3.7% 6.0% 6.0% -5.8% 5.80% 3.75% 3.75% 3.75% 3.75% 3.75% General Operating Exp. 3,336,567 3,612,093 4,285,887 4,580,695 4,793,555 5,071,161 5,362,848 5,669,279 Sal & Ben, Retirees & CalPERS UAL 1,984,848 1,909,556 2,024,798 2,455,095 2,699,487 2,895,675 3,109,529 3,332,464 3,563,982 3,812,630 Water Purchases 2,253,041 3,121,450 3,215,163 3,313,445 3,694,509 3,951,727 4,127,674 4,366,484 4,617,401 4,880,996 CCWD annual Demand Chg , , , , , , , , ,283 Water Samples 27,540 59,000 59,400 62,000 63,860 65,776 67,749 69,782 71,875 74,031 RBWTP O&M 1,167,900 1,100,000 1,238,463 1,334,706 1,361,400 1,388,628 1,416,401 1,444,729 1,473,623 1,503,096 Utilities & Tel 206, , , , , , , , , ,387 Maintenance 630, , , , , , , , , ,111 General Operating Incl new EE exp 171, , , , , , , , , ,548 Safety 5,100 4,662 3,344 6,200 6,324 6,450 6,579 6,711 6,845 6,982 Directors 8,000 8,750 6,823 20,000 8,000 15,000 8,000 15,000 8,000 8,000 Auto & Travel & Education 78,030 67,729 75,240 86,500 88,230 89,995 91,794 93,630 95,503 97,413 Insurance 102, , , , , , , , , ,878 Accounting 45,900 34,675 44,937 45,000 45,900 46,818 47,754 48,709 49,684 50,677 Engineering/Consulting 61,200 35,862 63,507 80, ,000 83,000 84,660 86,353 88,080 89,842 Legal 26,010 25,510 27,880 28,950 29,529 30,120 30,722 31,336 31,963 32,602 Office Expenses & Rent 234, , , , , , , , , ,752 Dues & Licenses 20,604 21,402 22,400 23,750 24,225 24,710 25,204 25,708 26,222 26,746 Infra and Replace Transfer Sub Total GO Exp. 7,022,890 7,612,735 8,326,014 9,352,354 10,422,863 10,889,487 11,377,821 11,955,375 12,543,012 13,170,975 General Capital & Debt RBWTP Bonds to , , , , , , Glen Park Well & Blending 51,561 90,211 75, , , , , , , ,898 LAFCo 2,438 3,000 3,090 3,183 3,278 3,377 3,478 3,582 BNSF 24" Pipeline 17,565 16,600 17,915 17,575 18, Stonecreek Well & PS Stonecreek Pipeline Office Record Imaging 5,000 14,000 8,219 14,000 14,000 14,000 14,000 5,000 5,000 5,000 New Office 92, , , , , ,392 1,012,938 Corp Yard Bldg 500, , , ,000 Railroad Crossing Sub Total Gen Capital & Debt 535, , , , , ,783 1,646, , , ,480

20 Appendix A B C D E F P Q R S T U V W X Y EXPENSES FISCAL YEAR ENDING JUNE 30 Actual Actual Actual Budget Forecast Forecast Forecast Forecast Forecast Forecast FY 2015 / 16 FY 2016 / 17 FY 2017 / 18 FY 2018 / 19 FY 2019 / 20 FY 2020 / 21 FY 2021 / 22 FY 2022 / 23 FY 2023 / 24 FY 2024 / Renewal & Replacement Office Carpet Replacement Public ROW Relocations 50,000 54,099 15, ,000 75, , , , , , BNSF 2nd track relocate 2500 LF 24" - 20% Valve Turner Randall-Bold Filter Testing RB WTP Media Replacement 0 8, , RB WTP ph Control RB WTP Replace Computer Sys 0 15,139 70, , RB WTP Restoration General 59,700 47,364 35,563 35, ,303 78,000 78,000 78,000 81,000 81, RB WTP Restoration Tanks 96, , RB Seismic RB Ground Water Impact RB Ops Bldg Stair Repair & Sealing 38, , RBWTP Master Plan Update 64,693 10, , , , , RBWTP Pump Rebuild 70, , RB Hypochlorite Conversion 0 71 RB Backwash Lagoon Lining RB Solids Lagoon Lining RB Ozone System Rehab 171,943 28, , RB Energy Audit 81, RB Safety/Security Access & Control 8,053 17,000 36,662 30,000 32,000 33,000 35,000 35, RB Elec. Equip. Rehab & Replace 29, , , Purchase Backhoe 100, Corp Yard Improvements 50,000 11,509 15,133 19,800 50,000 50,000 50,000 50,000 50,000 50, Corp Yard Clearwell Drain Truck 0 39, ,000 50,000 40, , Truck Utility Body , Corrosion Testing 20,000 20,000 12,610 20,000 20,000 20,000 20,000 20,000 20,000 20, Office Equipment 30, ,000 30,000 30,000 30,000 30,000 30, Valve Replacement 15,000 6, ,000 15,000 15,000 50,000 50,000 50,000 50, Replace Large Fire Services ,000 25,000-30, Facilities Replacement Study 100, DWD SCADA Upgrade 50 % FR 10,000 1,499 37,500 10,000 10, , ,000 10,000 10, Res 1& 2 Mixers Office Software 5,000 40,000 5,000 6,000 6, Glen Park/ Stone Creek/ South Park VFD Repair/Replace 200, , Glen Park Well / Pump Rehab 100,000 78, , Stone Creek Pump/Well Rehab 75, , South Park Pump/Well Rehab 100, Reservoir 2 Foundation Reservoir 1 Seismic 250, Truck Fill Board Room Access Improvements UWMP Update 50% FR 5,764 60,000 80, New Office Expense 203,500 7,000 5,628 12, Radio Read Meter Upgrade 6,522 49, , CalPERS Side Fund Payoff 102 CalPERS Unfunded Liability 70, County Retirement Reconciliation 154, ,061 94,668 94,668 94,668 94,668 94,668 94,668 94,668 94, Well Line Ice Pigging 126, Corp Yd. Pump Base Design 26,000 12, Corp Yd. Pump Base Repair 6, ,303

21 Appendix A B C D E F P Q R S T U V W X Y EXPENSES FISCAL YEAR ENDING JUNE 30 Actual Actual Actual Budget Forecast Forecast Forecast Forecast Forecast Forecast FY 2015 / 16 FY 2016 / 17 FY 2017 / 18 FY 2018 / 19 FY 2019 / 20 FY 2020 / 21 FY 2021 / 22 FY 2022 / 23 FY 2023 / 24 FY 2024 / 25 Corp Yard VFD 200, HP Pump at Corp Yard 100,000 Amortization Expense Not Included in Sub Total 9,364 Sub Total Renew & Replace 850, , ,057 1,214,696 1,209,629 1,153,668 1,384,668 1,239,168 1,053, ,668 Total Gen. Ops. Exp. Without Reclassification 8,408,984 8,923,834 9,527,905 11,327,910 12,430,996 12,501,938 14,409,172 13,821,606 14,225,758 14,716,123 Facilities Res. Exp RBWTP Bonds to , , , , , , RBWTP Extra Capacity BNSF 2nd track relocate 2500 LF 24" - 80% 70,260 66,399 71,660 70,300 72,810 0 Legal 25,000 25,510 27,880 28,950 29,819 30,713 31,634 32,583 33,561 34,568 Labor & Benefits 280, , , , , , , , , ,703 CalPERS Side Fund Payoff Engineering/Consulting 50,000 3,676 24,395 40,000 50,000 50,000 50,000 50,000 50,000 50,000 Groundwater Exploration 30,000 4,749 6,396 10,000 30, ,000 30,000 30,000 30,000 Groundwater Sustainability Plan 20,584 15,000 25,000 35,000 10,000 10,000 10,000 10,000 Publications 5,000 1, ,000 5,000 5,000 5,000 5,000 5,000 5,000 Specification updates 0 20,000 Hydrant Meters , , Master Plan Update 100, ,000 UWMP 50% General 5,764 60,000 80,000 SCADA upgrade 50% in General 10,000 1, ,500 10,000 10, , ,000 10,000 10,000 Asset Management GIS/ Mapping 20,000 15,402 80,364 24,000 50, ,000-0 R-1 Seismic Eval Reservoir R3 New Office Expense 203,500 7,000 5,628 5,000 New Office Debt 92,515 78,638 78,971 78,638 78,638 78,638 1,012,938 LAFCo 2,438 3,000 3,000 3,000 3,000 3,000 3,500 3,500 Stonecreek / RB Utility waterline Well Pipeline Hydrant & Services 76,522 Second Well Design, Mitigations & Construction Financing for Stonecreek Well (2010) 285, , , , , , , , , ,000 and Balance of R3 ($286,000/yr) Blending & Glen Park 2005 / 2013 COPs 341, , , , , , , , , ,004 Total Fac. Res 2,394,182 2,176,056 2,092,153 2,431,149 2,328,624 1,678,445 2,410,675 1,468,404 1,339,912 1,455,775

22 Appendix A B C D E F P Q R S T U V W X Y EXPENSES FISCAL YEAR ENDING JUNE 30 Actual Actual Actual Budget Forecast Forecast Forecast Forecast Forecast Forecast FY 2015 / 16 FY 2016 / 17 FY 2017 / 18 FY 2018 / 19 FY 2019 / 20 FY 2020 / 21 FY 2021 / 22 FY 2022 / 23 FY 2023 / 24 FY 2024 / 25 Total Debt Service Summary RBWTP 1,338,563 1,338,997 1,336,158 1,341,163 1,344, , COP Stonecreek 285, , , , , , , , , , COP Blending GP 24" BNSF 392, , , , , , , , , ,902 New office debt 185, , , , , ,030 2,025,876 0 Total Debt Service 2,201,427 2,421,527 2,253,817 2,415,714 2,413,848 1,553,645 2,815, , , ,902 Capacity Allocation of Debt Stonecreek is 100% future capacity until Glen Park goes over 2mgd Max Day Date 8/12/2015 8/15/2016 7/10/2017 8/1/2018 Projected Projected Projected Projected Projected Projected RBWTP Use Average of month that max day occurs Groundwater Use Average of month that max day occurs Av. Current and Prior FY RBWTP Use, mgd Av. Current and Prior FY GW Use, mgd RBWTP Capacity, mgd Current Users % of RBWTP Capacity Used 28.90% 33.86% 33.84% 37.90% 40.25% 42.07% 42.99% 43.85% 44.71% 45.57% RBWTP Annual Bond Payment 1,438,608 1,440,499 1,442,363 1,441,387 1,246, Savings from refinancing -100, , , ,224 97, ,413 Share Paid by General Fund for RBWTP 386, , , , , , Share Paid by FRC for RBWTP 951, , , , , , Glen Park well capacity, mgd Current Users % of GP Well Capacity Used 57.00% 39.00% 48.00% 48.50% 52.41% 50.67% 51.78% 52.82% % 2013 COP Annual Payment 489, , , , , , , , , ,785 Refinance savings 2005 / 2013 COP Annual Payment 430, , , , , , , , , ,902 Share of 2013 for GP & Blending 530, , , , , , , , ,902 Share of 2013 for BNSF 24" pipeline 87,825 86,225 89,575 87,875 91,012 Glen Park Well & PS % of 2013 COP 21% 21% 21% 21% 21% 21% 21% 21% 0 21% Share Paid by General Fund for GP Well ,561 43,479 53,265 53,056 57,058 55,357 55,557 56,627 57,552 58,659 Share Paid by FRC for GP Well ,897 68,005 57,704 56,338 51,801 53,883 51,738 50,589 49,318 48,210 Blending Capacity, mgd Current Users % of Blending Capacity Used 11.14% 11.14% 16.29% 14.14% 14.50% 14.79% 15.09% 15.39% % Blending & Pipeline % of 2013 COP 79% 79% 79% 79% 79% 79% 79% 79% 1 79% Share Paid by General Fund for Blending ,918 46,732 67,986 58,202 59,372 60,797 60,909 62,059 63,049 64,239 Share Paid by FRC for Blending , , , , , , , , , ,794 % of 13 COPs -GP & Blending for FR % of 13 COPs -GP & Blending for GF GP & Blending Charged to FR 407, , , , , , , ,004.1 GP & Blending Charged to GF 121, , , , , , , ,897.9 BNSF 24" 20% for Gen Fund 17,565 17,245 17,915 17,575 18,202 BNSF 24" 80% for FR 70,260 68,980 71,660 70,300 72,810 Stonecreek Well and 2mgd Stonecreek 7 mgd 2010 COP Stonecreek well and pipeline 284, , , , , , , , , ,315 Share Paid by General Fund for Stonecreek 2010 Share paid by FRC for Stonecreek , , , , , , , , , ,315

23 APPENDIX A2 Salary Estimates and Allocations Actual 2018 Budget 2019 Estimated 2020 Estimated 2021 Estimated 2022 Estimated 2023 Estimated 2024 Estimated 2025 Salaries 1,481, ,687, ,788, ,895, ,009, ,129, ,257, ,393, Overtime 121, , , , , , , , Benefits 420, , , , , , , , CalPERS Ret 170, , , , , , , , CalPERS UAL 97, , , , , , , , Tax/WC 135, , , , , , , , TOTAL 2,427, ,880, ,102, ,328, ,574, ,830, ,096, ,382, Chargeable to Operating Fund 2,065,539 2,448,167 2,637,429 2,829,108 3,038,046 3,255,856 3,482,051 3,724,984 Chargeable to Facilities Reserve Fund 314, , , , , , , ,703 Chargeable to MERA Fund 47,115 57,604 62,057 66,567 71,483 76,608 81,931 87,647

24 Appendix B B C D N O P Q R S T U V W X Y REVENUES FISCAL YEAR ENDING JUNE FY 2015 / 16 FY 2016 / 17 FY 2017 / 18 FY 2018 / 19 FY 2019 / 20 FY 2020 / 21 FY 2021 / 22 FY 2022 / 23 FY 2023 / 24 FY 2024 / 25 General Fund Revenues Actual Actual Actual Actual Actual Budget Forecast Forecast Forecast Forecast Forecast Forecast CUWCC BMP 1.4: V/V+M >70% Water Sales V 6,303,004 6,312,141 5,538,061 6,284,554 7,479,854 8,049,461 8,909,181 9,419,678 9,894,620 10,289,933 10,487,938 10,685,944 Mo. Svc. Chg M 1,303,090 1,372,096 1,426,022 1,490,023 1,575,354 2,092,461 2,719,634 2,876,308 3,021,893 3,141,777 3,202,233 3,262,689 Late Fees 26,000 26,520 27,050 52,845 51,913 55,000 56,650 58,350 60,100 61,903 63,760 65,673 Check Valve Charge 58,000 59,160 60,343 99, , , , , , , , ,257 Check Valve install 3, ,500 2,500 2,500 2,500 2,500 2,500 2,500 Trip Charge/drought charge 12,178 12,422 12,670 21,600 20,166 25,000 25,750 26,523 27,318 28,138 28,982 29,851 Call Out Charge 3,000 1,600 2,500 2,500 2,500 2,500 2,500 2,500 2,500 Tampering Fee 2,537 2,365 2,500 2,500 2,500 2,500 2,500 2,500 2,500 Return Check Charges 2,000 2,040 2,081 2,800 1,915 1,972 2,032 2,093 2,155 2,220 2,287 2,355 Credit Reports 2,040 2,081 2, Meter/Hydrant Repairs/Field Service Charges 6, Bad Debt Recovery 1,000 1,020 1,040 5,600 1,969 2,028 2,089 2,152 2,216 2,283 2,351 2,422 General Fund Interest 18,533 44,205 41,778 34,215 4,087 39,322 35,463 35,608 41,925 35,654 40,570 44,307 Admin Eng/Insp Wages Charged Only (audit does no 41, , , , , , , , , , , ,918 Brentwood overlap fees 0 150, ,000 Delta Coves Prop Tax 50,999 50,999 50,999 50,999 50,999 50,999 50,999 50,999 County Wells w/o ,960 49,939 50,938 52,466 11,940 12,298 12,667 13,047 13,439 13,842 14,257 14,685 DM Well 5,610 5,722 5,837 6,012 RB Reconciliation GTE Sprint and MCI Rental income 54,907 56,005 57,125 79,215 79,372 81,753 84,206 86,732 89,334 92,014 94,774 97,618 Other Misc CCWD refund Overbilling Reduces Expe 10,000 10,200 CERBT for OPEB 60,000 65,000 66,300 68, Carol Lane Lease 50% General 50% FRC 8,208 14,490 15,175 24,736 25,478 26,242 27,030 27,841 28,676 29,536 Payment of New Office Loan from Escrow 92, ,392 0 Other Misc Previous Brent Pump Station ,000 24,000 24,000 24,000 24,000 24,000 24,000 Subtotal General Fund Income 7,946,604 8,268,551 7,647,090 8,625,135 9,570,239 10,942,032 12,445,399 13,133,657 13,782,074 14,313,220 14,599,483 14,885,253 TOTAL GENERAL FUND INCOME 7,946,604 8,268,551 7,647,090 8,625,135 9,570,239 10,942,032 12,445,399 13,133,657 13,782,074 14,313,220 14,599,483 14,885,253 FACILITIES RESERVE INCOME Developer Fees 1,124,480 1,757,000 1,433,712 1,549,332 1,638,677 2,164,236 2,400,000 2,060,000 2,121,800 2,185,454 2,251,018 2,318, Carol Lane Lease 50% General 50% FRC 8,208 14,351 15,175 24,736 25,478 26,242 27,030 27,841 28,676 29,536 Developer Capital Contributions - Non Cash 92,515 78, ,000 Interest earnings 20,322 36,141 37,587 39,268 11,192 29,023 26,891 28,129 32,488 30,195 37,945 47,723 TOTAL FACILITIES RESERVE INCOME 1,144,802 1,793,141 1,572,022 1,681,589 1,890,044 2,217,995 2,452,369 2,114,371 2,181,318 2,243,489 2,317,639 2,395,807

25 DIABLO WATER DISTRICT APPLICATION FOR DISCOUNTED MONTHLY SERVICE CHARGE FOR SENIOR CITIZENS Diablo Water District allows a 25% discount on the Monthly Service Charge for Senior Citizens over the age of 62 whose total annual household income is $46,000 or less. The person qualifying for the discount MUST be the account holder. If you feel you qualify, fill out this application and deliver it to Diablo Water District at 87 Carol Lane, Oakley, or mail it to the District office at P.O. Box 127, Oakley, CA Phone: Name Address Account Number Oakley, CA Phone Attach Proof of age which may be a copy of a driver s license, birth certificate, state identification card, etc. Number of persons living at this address Total gross annual income of all persons living at this address $ Attach Proof of income which may be copies of tax returns, statements of Social Security benefits, pensions, interest, etc. I declare that the foregoing information is true and correct. Signature Date

26 DIABLO WATER DISTRICT APPLICATION FOR DISCOUNTED MONTHLY SERVICE CHARGE FOR PERMANENT AND TOTAL DISABILITY Diablo Water District allows a 25% discount on the Monthly Service Charge for customers permanently and totally disabled whose total annual household income is $46,000 or less. The person qualifying for the discount MUST be the account holder. If you feel you qualify, fill out this application and deliver it to Diablo Water District at 87 Carol Lane, Oakley, or mail it to the District office at P.O. Box 127, Oakley, CA Phone: Name Address Account Number Oakley, CA Phone Attach Proof of total and permanent disability which may be a copy of a Social Security disability letter or a medical record. Number of persons living at this address Total gross annual income of all persons living at this address $ Attach Proof of income which may be copies of tax returns, statements of Social Security benefits, pensions, interest, etc. I declare that the foregoing information is true and correct. Signature Date

27 TABLE 2 Discount On Service Charges Vs Non Water Revenue Monthly Income AT&T Cell Site Crown Castle Cell Site Sprint Cell Site Mt. Diablo - 85 Carol Lane HomeServe Income Monthly Discount Total All Customers Jan-18 $ 1, $ 3, $ 1, $ 1, $ 1, $ Feb-18 $ 1, $ 3, $ 1, $ 1, $ $ Mar-18 $ 1, $ 3, $ 1, $ 1, $ 1, $ Apr-18 $ 1, $ 3, $ 1, $ 1, $ 1, $ May-18 $ 1, $ 3, $ 1, $ 1, $ $ Jun-18 $ 2, $ 3, $ 1, $ 1, $ $ Jul-18 $ 1, $ 3, $ 1, $ 1, $ 1, $ Aug-18 $ 1, $ 3, $ 1, $ 1, $ $ Sep-18 $ 1, $ 3, $ 1, $ 1, $ 1, $ Oct-18 $ 1, $ 3, $ 2, $ 1, $ 1, $ Nov-18 $ 1, $ 3, $ 2, $ 1, $ $ Dec-18 $ 1, $ 3, $ 2, $ 2, $ 1, $ Estimated Total 2018 $ 17, $ 43, $ 23, $ 16, $ 13, $ 5, Jan-19 $ 1, $ 3, $ 2, $ 2, $ 1, $ Estimated 2/1/19-1/31/20 $ 16, $ 44, $ 24, $ 25, $ 12, $ 8, Estimated Total 2019 $ 17, $ 48, $ 26, $ 27, $ 13, $ 8, *See Footnote Grand Total Misc. Income $ 133, % of Discount vs. Misc Income 6.57% * Because the Rental Income from 85 Carol Lane is split 50/50 between 01-Operating and 02-Facilities Reserve, we are only accounting for 50% of the Rental Income from the Operating Fund on this chart.

28 Appendix D A B C D E F G H Q R S T U V W X Y Z 1 2 DIABLO WATER DISTRICT Audited Audited Audited Budget Forecast Forecast Forecast Forecast Forecast 3 Multi-year Financial Forcasting Monthly Bill & Increase for Average Customer Fiscal Year Ending June 30 Average Monthly Bill $68.21 $72.13 Dollar Increase / Month $3.92 Minimum General Fund Balance = $3.9 million, Including $1 million of Rate Stabilization Funds Rate Increase % 5.75% Minimum Facilities Reserve Fund Balance = $1.8 million Tier Tier FY 15 / 16 FY 16 / 17 FY 17 / 18 FY 18 / 19 FY 19 / 20 FY 20 / 21 FY 21 / 22 FY 22 / 23 FY 23 / 24 FY 24 / Number of Services 11,329 11,529 11,682 11,942 12,242 12,492 12,742 12,992 13,242 13,492 Increase over prev.yr. 1.3% 1.8% 1.3% 2.2% 2.5% 2.0% 2.0% 2.0% 1.9% 1.9% New Connections added to system Consumption gal. /day/service Water Rate Per HCF Tier 1 first 200 gallons per day Water Rate Per HCF Tier 2 over 200 gallons per day Mo. Svc. Charge Facilities Reserve Water Connection Charge 7,169 6,800 7,004 7,214 8,000 8,240 8,487 8,742 9,004 9,274 Interest Rate 1.0% 1.0% 1.0% 1.0% 1.0% 1.0% 1.0% 1.0% 1.0% 1.0% Inflation Rate 2.0% 3.0% 3.0% 3.0% 3.0% 3.0% 3.0% 3.0% 3.0% 3.0% General Fund Balance 3,421,497 3,339,643 3,932,227 3,546,349 3,560,751 4,192,471 3,565,372 4,056,986 4,430,710 4,599,841 Facilities Reserve Fund Balance 3,926,775 3,476,503 2,902,290 2,689,136 2,812,882 3,248,808 3,019,451 3,794,536 4,772,263 5,712,294 TOTAL OF FUND BALANCES 7,348,272 6,816,146 6,834,517 6,235,485 6,373,633 7,441,279 6,584,823 7,851,522 9,202,973 10,312,135 ANNUAL REVENUE General Fund Operating 7,647,090 8,625,135 9,570,239 10,942,032 12,445,399 13,133,657 13,782,074 14,313,220 14,599,483 14,885,253 Facilities Reserve 1,572,022 1,681,589 1,890,044 2,217,995 2,452,369 2,114,371 2,181,318 2,243,489 2,317,639 2,395,807 TOTAL ANNUAL REVENUE 9,219,112 10,306,724 11,460,283 13,160,027 14,897,768 15,248,029 15,963,391 16,556,709 16,917,121 17,281,060 ANNUAL EXPENSES Operating and Renewal & Replacement and Debt 8,408,984 8,923,834 9,527,905 11,327,910 12,430,996 12,501,938 14,409,172 13,821,606 14,225,758 14,716,123 Facilities Reserve 2,394,182 2,176,056 2,092,153 2,431,149 2,328,624 1,678,445 2,410,675 1,468,404 1,339,912 1,455,775 TOTAL ANNUAL EXPENSES INCLUDING DEBT 10,803,166 11,099,890 11,620,058 13,759,059 14,759,620 14,180,383 16,819,847 15,290,010 15,565,670 16,171,898

29 FY 15 / 16 FY 16 / 17 FY 17 / 18 FY 18 / 19 FY 19 / 20 FY 20 / 21 FY 21 / 22 FY 22 / 23 FY 23 / 24 FY 24 / 25 Chart Diablo Water District Fund Balances Fiscal Year Ending June 30th 400 GPDPS in 2019 and 430 GPDPS Thereafter Genaral Fund Min. With Rate Stabilization $3.9 Mil Facilities Reserve Minimum $1.80 Mil General Fund Facilities Reserve

30 FY 15 / 16 FY 16 / 17 FY 17 / 18 FY 18 / 19 FY 19 / 20 FY 20 / 21 FY 21 / 22 FY 22 / 23 FY 23 / 24 FY 24 / 25 Chart Diablo Water District Fund Balances Fiscal Year Ending June 30th 400 GPDPS in 2019 and Thereafter Genaral Fund Min. With Rate Stabilization $3.9 Mil Facilities Reserve Minimum $1.80 Mil General Fund Facilities Reserve

31 FY 15 / 16 FY 16 / 17 FY 17 / 18 FY 18 / 19 FY 19 / 20 FY 20 / 21 FY 21 / 22 FY 22 / 23 FY 23 / 24 FY 24 / 25 Chart Diablo Water District Fund Balances Fiscal Year Ending June 30th No Rate Increase and 400 GPDPS in 2019 and Thereafter Genaral Fund Min. With Rate Stabilization $3.9 Mil Facilities Reserve Minimum $1.80 Mil General Fund Facilities Reserve

32 TABLE 1 Allocation of Budget Costs for Over 200 Gallons Per Day Tiered Rates Nexus Summary 2019 Budget Item Percentage Budget Total Tier 2 Allocation Salaries/Benefits 15% $ 2,455, $ 368, Utilites/Phones 15% $ 225, $ 33, Watching for High Usage and Leaks/Phone Calls/Data Entry/Leak Checks/High Usage Doorhangers/Etc. Office Supplies 15% $ 30, $ 4, Copier Maintenance/Paper/Ink/High Usage Reports/Doorhangers Consulting 10% $ 55, $ 5, Information in Fliers/Newsletters/Updating Website Legal 5% $ 57, $ 2, Auto 15% $ 68, $ 10, Cost of Gas/Truck Maintenance Incidental Cost of Flexnets 100% $ 3, $ 3, We expect to have at least 25 additional incidental flexnet installations due to high usage (cost is $ each) Conservation 100% $ 3, $ 3, Annual Conservation Budget Expenses Attributable to Water Use Over 200 gal Per Day $ 432, Total Approximate Budget for 2019 $ 11,327, Total Allocation Percentage 4% RBWTP Water Use Cost of Capacity Summertime with Irrigation 6.0 mgd $551,000 Indoor 2.3 mgd $211,000 Difference for Tiers $340,000 $340,000 Glen Park & Blending Water Use Cost of Capacity Summertime with Irrigation 0.99 mgd $111,258 Indoor 0.55 mgd $88,286 Difference for Tiers $22,972 $22,972 Total of Additional Expenses for Tier 2 Allocation $ 795,015 Revenue with Tiers - $3.22 T1 & $3.60 T2 $ 10,142,000 Revenue Without Tiers $3.22 $ 9,994,000 Total Incremental Income from Tier 2 $ 148,000 Incremental Income from Tier 2 is Less than Additional Expenses

33

34 Classified Advertising Cust# 7460 Receipt Cust Tel# Diablo Water District P.O. Box 127 Oakley, CA (925) Ad# Date: 12/04/18 Salesperson: Jovel Parlog PO#: Christine Belleci Edition Insertion Date Amount Brentwood Press 12/07/ Brentwood Press 01/11/ Total: Grand Total Ad Text Diablo Water District Notice of Public Hearing on Proposed Water Charges Increase of Up to 5.8% for the Average Customer Diablo Water District (DWD) will conduct a Public Hearing on Wednesday, January 23, 2019, at 7:30 p.m. at Diablo Water District s office, 87 Carol Lane, Oakley, where an increase in the District s water charges of up to 5.8% for the average customer will be discussed. The purpose of the increase is to cover the expected February 2019, Contra Costa Water District (CCWD) water rate increase of 7.4% overall; which includes a 623% increase in the monthly fixed operation cost portion of our water purchases and a 6% reduction in the water charge. DWD must also pay the cost of renewal and replacement projects at the 26-year-old Randall-Bold Water Treatment Plant and increases in water system operation and maintenance costs. Public comments and written protests from property owners or ratepayers will be accepted at the Public Hearing or by delivery to the District at 87 Carol Lane, P.O. Box 127, Oakley, CA 94561, prior to the hearing date. If the 5.8% increase is adopted, the typical residential Monthly Service Charge would go from $11.61 to $16.61; however, the Tier 1 - Water Charge would be lowered 4% from $3.35 per Hundred Cubic Feet (HCF) to $3.22 per HCF for the first 8 HCF; and the Tier 2 - Water Charge would remain the same at $3.60 per HCF for water use over 8 HCF during each billing period. Monthly Service Charges for all meter sizes as described in Regulation No. 1, would also increase by $5.00. Monthly charges for check valves over 2, fire services 4 to 6 in size, and fire hydrant meters would each be increased by $1.00. The effective date of the new rates would be February 1, If you have any questions please call (925) DIABLO WATER DISTRICT Daniel Muelrath, General Manager & Secretary Posted in the Oakley Press: Friday, December 7, 2018, and Friday, January 11, Oakley Press No Publish Dates: December 7, 2018, January 11, 2019.

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36 DIABLO WATER DISTRICT January 23, 2019 Board Meeting Item Number 5 TO: FROM: SUBJECT: Each Director Dan Muelrath, General Manager Resolution of the Board of Directors of Diablo Water District Amending Regulations Numbered One, Two, Five and Six to Reflect the Current Cost of Service. Attached is Resolution which amends the water charges in the District s Regulations per the Notice of Public Hearing that was sent to all customers. RECOMMENDATION: Adopt Resolution Dan Muelrath General Manager Attached: Resolution

37 RESOLUTION NO A RESOLUTION OF THE BOARD OF DIRECTORS OF DIABLO WATER DISTRICT AMENDING REGULATIONS NUMBERED ONE, TWO, FIVE AND SIX TO REFLECT THE CURRENT COST OF SERVICE. BE IT RESOLVED by the Board of Directors of Diablo Water District that Sections 1A, 1E and 2 of Regulation No. 1; Section 4(d) of Regulation No. 2; Section 2(c) of Regulation No. 5; and Section 6 of Regulation No. 6 of this District are hereby amended, effective February 1, 2019, to read as follows: REGULATION NO. 1 RATES AND CHARGES FOR WATER SERVICE Section 1A Monthly Service Charge A monthly service charge shall be paid for each connection to the District's domestic water service system, except as provided in hereafter as follows: Size of Meter Service Charge 5/8" x 3/4" $ " * /2" " " " " " 1, " 1, " 2, " 3, " 4, The monthly service charge for a one (1) inch meter for residential services which is made necessary for the installation of a fire sprinkler system shall be the same as the charge for a five-eighth (5/8) inch meter for one- and two-family residential systems, for either new construction or retrofit.

38 Resolution Page 2 of 4 Section 2. Quantity Charge A quantity charge shall be paid for all water delivered by the District as follows: a. For all uses of water except as specified in (b), (c), and (d) below: $3.22 per hundred cubic feet for the first 8 hundred cubic feet of water used in a billing period and $3.60 per hundred cubic feet for water used over 8 hundred cubic feet in a billing period. b. For flushing-water to maintain chloramines residuals: $2.34 per hundred cubic feet. c. For well water used within the boundaries of Subdivision 7562, Contra Costa County, for irrigation and lake fill: $0.98 per hundred cubic feet. d. For well water used within the boundaries of M-25, M-26 and M-27 for construction: $0.84 per hundred cubic feet. REGULATION NO. 2 FIRE SERVICE Section 4. Private Fire Lines (d) Unmetered water service for fire fighting shall be provided at the following rates per month irrespective of the quantity, if any, of water used: Size of Detector Assembly Rate per Month 2 inches (min. size) $ inches inches inches inches 38.22

39 Resolution Page 3 of 4 REGULATION NO. 5 TEMPORARY WATER SERVICE Section 2. (c) Service through Fire Hydrants The customer shall pay the District $53.42 for each month or fraction of a month that the meter is in the possession of the customer. REGULATION NO. 6 CONTROL OF BACKFLOW AND CROSS CONNECTIONS Section 6. Service Charge for Backflow Prevention Devices Each customer having a backflow prevention device shall pay to the District a monthly service charge therefor as follows: Device Size Charge Per Month ¾" to 2" $ ½" $3.84 3" $4.77 4" $5.10 6" $7.01 8" $ " $ " $7.77 * * * * *

40 Resolution Page 4 of 4 I hereby certify that the foregoing is a true and complete copy of a resolution duly adopted by the Board of Directors of Diablo Water District at a special meeting thereof held on January 23, 2019, by the following vote: AYES: NOES: ABSENT: DATED: Dan Muelrath, Secretary

41 DIABLO WATER DISTRICT January 23, 2019 Board Meeting Item Number 6 TO: FROM: SUBJECT: Each Director Dan Muelrath, General Manager Resolution Amending Regulation Number 105, Deferred Compensation Limits. Due to IRS annual increases to the maximum contribution amount, staff is requesting to modify District Regulation 105 to reference the IRS code. This change will save staff time and would no longer require annual Board resolutions and District Regulation changes to match new maximum contribution limits. Attached is Resolution which revises the amount of income an employee may defer from: a maximum of $18,500 to based upon the contribution limits set forth by the Internal Revenue Code. RECOMMENDATION: Adopt Resolution Dan Muelrath General Manager Attached: Resolution

42 RESOLUTION NUMBER A RESOLUTION OF THE BOARD OF DIRECTORS OF DIABLO WATER DISTRICT AMENDING SECTION 4 (c) OF REGULATION NO. 105 BE IT RESOLVED by the Board of Directors of Diablo Water District that Section 4 (c) of Regulation Number 105 of Diablo Water District shall be and is hereby amended effective January 23, 2019, to read as follows: (c) The maximum amount of compensation that may be deferred in any year shall be based upon the contribution limits set forth by the Internal Revenue Code or 100% of the participant's pay, whichever is less, for services performed for the District during said year. Individuals age 50 and over can make additional pretax contributions to their plans, starting in the year they turn 50. The maximum annual catch up contribution shall be based upon the contribution limits set forth by the Internal Revenue Code for said year. * * * * * *

43 Resolution Page 2 of 2 I hereby certify that the foregoing is a true and complete copy of a resolution duly adopted by the Board of Directors of Diablo Water District at a regular meeting thereof held on January 23, 2019, by the following vote: AYES: NOES: ABSENT: DATED: Dan Muelrath, Secretary

44 DIABLO WATER DISTRICT January 23, 2019 Board Meeting Item Number 8 TO: FROM: SUBJECT: Each Director Dan Muelrath, General Manager General Manager Items and Reports Items included for discussion: Groundwater Sustainability Agency Outreach Handout Water Supply Charts o Statewide Reservoir Conditions o Total Water Demand o Local Well Production Press Release Regarding Contra Costa Canal Senate Bill Dan Muelrath General Manager

45 Draft EAST CONTRA COSTA SUBBASIN Maintaining Groundwater Sustainability in the East Contra Costa Subbasin Sustainable Groundwater Management Act (SGMA) Effective January 1, 2015, for the first time in California's history, the Sustainable Groundwater Management Act (SGMA) established a robust framework for the sustainable management of groundwater resources. Groundwater is a critical component of the state s water supply portfolio, and when effectively managed, this resource helps protect communities, farms, and the environment against the impacts of prolonged dry periods and climate change. SGMA recognizes that management is most effective when done at the local level by local agencies with adequate information, tools, resources, and authorities. East Contra Costa Groundwater Subbasin Groundwater Sustainability Agencies (GSAs) A GSA is one or more local agencies that must develop, implement and enforce the subbasin s GSP. A local agency is any local public agency that has water supply, water management, or land use responsibilities within a groundwater basin. East Contra Costa Subbasin GSAs Sustainable Groundwater Management Management and use of groundwater in a manner that can be maintained during the planning and implementation horizon without causing undesirable results. Undesirable results consist of the following sustainability indicators: Chronic lowering of groundwater levels indicating a significant and unreasonable depletion of supply Significant and unreasonable reduction of groundwater storage Significant and unreasonable seawater intrusion Significant and unreasonable degraded water quality Significant and unreasonable land subsidence Depletions of interconnected surface water that have significant and unreasonable adverse impacts on beneficial uses of the surface water Basin setting and description of groundwater conditions Hydrogeologic conceptual model (how the aquifers react to stresses in the basin over time and the interaction of surface water and groundwater systems) Determine data gaps and uncertainties Water budget that accounts for surface water and groundwater inflows and outflows Baseline conditions for supply, demand, hydrology and surface water supply reliability What GSAs Do Groundwater Sustainability Plans (GSPs) Coordination: GSAs need to coordinate with other local and regional agencies in their basin and neighboring basins. Public Outreach & Stakeholder Engagement: A GSA is required to engage with interested stakeholders during GSP development and implementation. GSP Development: Every medium and high priority basin is required to develop and implement one or more GSPs. If multiple GSPs are developed for the same basin, a coordination agreement will be required. Monitoring & Reporting: Monitoring of groundwater levels and water quality is needed to track progress toward meeting the sustainability objectives of the GSP. GSP Implementation: The GSP for the East Contra Costa Subbasin is due by January 31, 2022 and the subbasin should achieve groundwater sustainability by Enforcement: The GSAs will need to enforce the provisions adopted in its GSP. It is up to the local GSAs with the input of the local groundwater users and stakeholders to determine what particular authorities and tools will be used to successfully achieve the GSP objectives. Under SGMA, GSAs are required to develop and implement GSPs with the following: Sustainable management criteria Establish minimum thresholds and measurable objectives for each sustainability indicator Establish monitoring network and protocols for each sustainability indicator Identify projects and management actions to achieve or maintain sustainability Public communication and engagement Contact: groundwaterinfo@dcc.cccounty.us Website:

46 Draft EAST CONTRA COSTA SUBBASIN Contact: Website: Monitoring to Maintain Sustainability in the East Contra Costa Subbasin The Importance of Groundwater Groundwater is water below ground contained in formations known as aquifers, which supply significant quantities of water to wells and springs. Groundwater is a vital resource of water supply in the East Contra Costa Subbasin. Many residents, businesses, and farms rely on groundwater, as do fish, wildlife, and natural habitats. These water demands make it essential that we: Preserve the quality and availability of local and imported water supplies; Sustain groundwater supplies and meet water needs during drought conditions; Anticipate and avoid potential negative environmental effects due to groundwater use; Anticipate and avoid adverse changes in long-term groundwater availability and quality. Monitoring Network What We Know Counties and agencies within the East Contra Costa Subbasin have been monitoring groundwater resources for decades. Based on long-term data and recent studies, agencies within the East Contra Costa Subbasin continue to: Develop and implement better groundwater data collection procedures; Report on annual groundwater conditions and trends and; Implement actions in compliance with the Sustainable Groundwater Management Act (SMGA). Groundwater Quality What We Are Trying to Learn How does groundwater move through our aquifer system? What is the overall status of the groundwater aquifers within the subbasin? What are the amounts of loss and replenishment to creeks, rivers, and aquifers? What are the key relationships between groundwater and surface water in our creeks, rivers and other bodies of water? Ground Water Levels A combination of municipal wells, agricultural wells, dedicated monitoring wells, & other surface water or groundwater monitoring sites across multiple agencies can be used for monitoring and understanding surface water and groundwater conditions. California has an enforceable drinking water regulation for Nitrate as Nitrogen, (e.g. Maximum Contaminant Level of 10 mg/l [10 ppm]) that is based on the best available science to prevent potential health problems. The California Department of Water Resources maintains the California Statewide Groundwater Elevation Monitoring (CASGEM) Program since 2009 to track seasonal and long-term groundwater elevation trends in groundwater basins statewide. Additional groundwater level monitoring data are also collected in the East Contra Costa Subbasin by local entities.

47 Ending At Midnight - January 17, 2019 LEGEND Capacity (TAF) Historical Average % of Capacity % of Historical Average Trinity Lake 62% 90% Lake Shasta 57% 87% Lake Oroville 34% 53% Folsom Lake 41% 80% New Melones Lake 76% 130% Don Pedro Reservoir 72% 107% Lake McClure 57% 124% San Luis Reservoir 80% 108% Millerton Lake 59% 100% Pine Flat Reservoir 35% 79% Lake Perris 88% 109% Castaic Lake 79% 98% Graph Updated 01/18/ :18 AM

48 DIABLO WATER DISTRICT WATER USE IN MILLION GALLONS (This chart does not include Utility Water) Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Total Year Average SBX7-7 Water Conservation Compliance (20% by 2020) Jan Feb March April May June July August Sept Oct Nov Dec Average Target Gross GPCD Million Gallons (MG) Population = 40,793 Gallons Per Capita Per Day (GPCD)

49 WELL WATER BLENDED INTO DISTRIBUTION SYSTEM MILLION GALLONS(MG) Jul-17 Aug-17 Sep-17 Oct-17 Nov-17 Dec-17 Jan-18 Feb-18 Mar-18 Apr-18 May-18 Jun TOTAL Jul-17 to Jan-18 at $ /MG Feb-18 to Jun-18 at $ /MG GRAND TOTAL: MG MG MG FY 17/18 SAVINGS $ 634, FY 16/17 SAVINGS $ 444, FY 15/16 SAVINGS $ 397, FY 14/15 SAVINGS $ 580, FY 13/14 SAVINGS $ 509, FY 12/13 SAVINGS $ 382, FY 11/12 SAVINGS $ 637, FY 10/11 SAVINGS $ 590, FY 09/10 SAVINGS $ 496, FY 08/09 SAVINGS $ 371, FY 07/08 SAVINGS $ 486, FY 06/07 SAVINGS $ 326, TOTAL SAVINGS IN WATER PURCHASES FROM CCWD TO DATE $ 5,858,108.00

50 WELL WATER BLENDED INTO DISTRIBUTION SYSTEM MILLION GALLONS(MG) Jul-18 Aug-18 Sep-18 Oct-18 Nov-18 Dec-18 Jan-19 Feb-19 Mar-19 Apr-19 May-19 Jun TOTAL Jul-18 to Jan-19 at $ /MG Feb-19 to Jun-19 at $ /MG GRAND TOTAL: MG MG MG FY 18/19 SAVINGS $ 373, FY 17/18 SAVINGS $ 634, FY 16/17 SAVINGS $ 444, FY 15/16 SAVINGS $ 397, FY 14/15 SAVINGS $ 580, FY 13/14 SAVINGS $ 509, FY 12/13 SAVINGS $ 382, FY 11/12 SAVINGS $ 637, FY 10/11 SAVINGS $ 590, FY 09/10 SAVINGS $ 496, FY 08/09 SAVINGS $ 371, FY 07/08 SAVINGS $ 486, FY 06/07 SAVINGS $ 326, TOTAL SAVINGS IN WATER PURCHASES FROM CCWD TO DATE $ 6,231,898.98

51 Feinstein, DeSaulnier Introduce Bill to Upgrade Contra Costa s Water Inf... of 3 1/15/2019, 10:24 AM

52 Feinstein, DeSaulnier Introduce Bill to Upgrade Contra Costa s Water Inf... of 3 1/15/2019, 10:24 AM

53 Feinstein, DeSaulnier Introduce Bill to Upgrade Contra Costa s Water Inf... of 3 1/15/2019, 10:24 AM

54 DIABLO WATER DISTRICT January 23, 2019 Board Meeting Item Number 9 TO: FROM: SUBJECT: Each Director Dan Muelrath, General Manager Financial Reports Items included for approval: Warrant register numbers A, and A (available at meeting). Items included for review: Monthly financial reports. Annual Other Post Employment Benefit Trust (OPEB CERBT) recap. Dan Muelrath General Manager

55 DIABLO WATER DISTRICT WARRANT REGISTER A DECEMBER 28, 2018 CK# PAYABLE TO FOR AMOUNT Christine Belleci Payroll 12/31/2018 6, LaVonda Castor Payroll 12/31/2018 5, Enrico E. Cinquini Payroll 12/31/ Kenneth L. Crockett Payroll 12/31/ John H. defremery Payroll 12/31/ Hunter J. Dejesus Payroll 12/31/2018 4, Alfonso Espinoza Jr. Payroll 12/28/2018 (Final Check) 5, Willow Ford Payroll 12/31/2018 3, Edward Garcia Payroll 12/31/ Jorge R. Gonzalez Payroll 12/31/2018 9, John H. Herrera Payroll 12/31/2018 5, Jennifer McCoy Payroll 12/31/2018 8, Michael Lira Payroll 12/31/2018 5, Atanacio Mendoza Payroll 12/31/2018 8, Cheri Milina Payroll 12/31/2018 3, Daniel B. Muelrath Payroll 12/31/ , Gino L. Padilla Payroll 12/31/2018 3, Rebecca Rugroden Payroll 12/31/2018 4, Luis Romero Payroll 12/31/2018 4, Paul S. Seger Payroll 12/31/ Wayne A Weaver Payroll 12/31/ , Michael Yeraka Payroll 12/30/2018 (Final Check) 11, AALR&R Consulting Services for District Voting 2, Altamont Landscape Office - Landscaping Improvements AT&T Telephone - Plant/Office/Office Fire Alarm AT&T Office Internet A2Z Homes, Inc Refund Over Pay Water Account Jessica Barraza or Arturo Alexis Refund Over Pay Water Account Big B Lumberteria Inc Maint CY - Lumber Bill Brandt Ford Reimb Exp - Delta Coves - Marina Cottages Vehicle Accident Borges & Mahoney Co. Operating Blending Brentwood Feed & Pet Maint Res - Straw for Goats st Northern Credit Union Credit Union Payable - Payroll Deductions 6, CCWD Water Samples 8, CCWD Water Purchases for November 286, Chevron & Texaco Auto - Gasoline 4, City of Oakley Maint T&D-Las Dunas/Empire/Mori/Carol/Highwood/Stirrup 2, City of Brentwood Reimb Exp - S9426/E711/S9033/Delta Coves (Water Samples) 1, Cooperative Strategies Consulting Fees for District Voting 8, CPS HR Consulting Consulting Fees for New GM Position Diablo Water District Payroll Tax Deposit 37, Mike Finney Refund Over Pay Water Account Sven Geffken Refund Over Pay Water Account Global Machinery GO T&D - New Digital Counter for Valve Turner Trailer Golden State Flow Maint T&D - New Meters 6, Guy Reed Trucking Maint T&D - Base Rock 4, Hill Brothers Chemical Co Reimb Exp - Delta Cove Chemicals Hunt & Sons Inc Auto - Gasoline & Car Wash Infosend Office Exp - Regular & Final Bills with Postage - November 5,948.07

56 DIABLO WATER DISTRICT WARRANT REGISTER A DECEMBER 28, 2018 PAGE 2 CK# PAYABLE TO FOR AMOUNT Erika Jazaie Refund Over Pay Water Account JW Backhoe & Construction Inc Install Water M27 / Maint T&D-Highwood/Pecan 70, Sierra Office Products Office Supplies - Pre Cut Half Sheets for Receipt Paper Lincoln National Life Insurance Accrued Deferred Compensation - Payroll Deductions 6, Lowe's Maint T&D - Flashlight/Pliers Ali Monsefan Refund Over Pay Water Account Oakley Ace Hardware GO CY - Batteries/Primer/Screws/Steel Braces/Caulking Pacific Gas & Electric Co Utilities - T&D Gas/Plant Electric Pacific Gas & Electric Co Utilities- Well Sites M24/M25/M26/M Pacific Gas & Electric Co Utilities - Stonecreek & Glen Park Wells 7, Diablo Water District Petty Cash - Laundry Exp/Mileage/Training-Exam Fees/Auto Platt Maint Glen Park - Replace Lights Jeffrey D Polisner Legal Expense 4, Pollard Water GO T&D - Dechlorinator 2, Roberts & Brune Co Maint T&D - Hydrant Flanges/Bolt Royal Brass Inc Maint T&D-Power Cord/Adaptor Scheer Security Office - Annual Fire Inspection Shred-It USA LLC Office - Shredding Services Standard Insurance Co Employee Life & LDT Payables 1, Staples Credit Plan GO CY-Daily Planner & Office Sup-Pens/Toner/Paper 1, Tractor Supply Co Maint T&D-Yellow Jacket/Sloped Neoprene Paul Urenda Jr. Retiree Employee Health Benefits US Bank Cal Card Purchases-CSMFO Dues/Dan's New Office Equip 4, Verizon Wireless GO T&D - Cell Phones & New Ipad Pro for Dan 2, Vision Service Plan Employee & Retiree Vision Coverage Benefit TOTAL WARRANTS 597,120.80

57 DIABLO WATER DISTRICT WARRANT REGISTER A DECEMBER 28, 2018 PAGE 3 The foregoing Accounts Payable Warrants through estimated payroll for December 2018, Federal, State Income Taxes withheld and retirement are hereby approved for payment. General Manager Director Director Director Director Director Signatures Required: General Manager and minimum of three (3) Directors

58 DIABLO WATER DISTRICT BANKING ACTIVITY for DECEMBER 2018 January 23, 2019 TRANSACTION TYPE DATE PAYABLE TO FOR AMOUNT Electronic Debit 12/07/18 Merchant Bankcard Credit Card Processing Fees - Vantiv (November) Electronic Debit 12/17/18 American Online Services Office Expense - AOL Account Electronic Debit 12/20/18 Point & Pay Credit Card Processing Fees - PNP (November) 4, Electronic Debit 12/28/18 State of California - EDD State Withholding - December 2018 Payroll 8, Electronic Debit 12/31/18 CalPERS CalPERS Retirement Contributions - December Payroll 30, Electronic Debit 12/31/18 American River Bank Bi-Annual Debt Service Payment for Admin Building 92, TOTAL ACTIVITY 136, The above Banking Transactions for December 2018 were given to the Board of Directors for their review as part of the January 23, 2019 Board Meeting. Jennifer McCoy Date Accounting Operations Manager

59 DIABLO WATER DISTRICT WARRANT REGISTER JANUARY 23, 2019 CK# PAYABLE TO FOR AMOUNT Aantex Pest Control Pest Control - CY/M24/Glen Park/Stonecreek/Office Abel Chevrolet-Pontiac-Buick Auto Chevy Exhaust Clamp ACWA/JPIA Employee Health Payable 41, ACWA/JPIA Workman's Comensation - 4th Quarter Payroll 8, Air Systems Service Office Maint Agreement - HVAC Altamont Landscape Office-Landscaping American Homes 4 Rent Refund Overpay Water Account AT&T Telephone - Glen Park Well & Scada Big B Lumberteria GO CY - Redwood 2x4's Borges & Mahoney Co. Maintenance Stonecreek & Glen Park Well 1, Danny Bowers Retiree Health Benefits Brentwood Auto Parts Inc Auto - Cleaner/Detailer/Wax/Wiper Blades Brentwood Press & Publish Office Supplies-Prop 218 Rate Notice Contra Costa Health Services Health Permits for M25/M26/M27 4, CCWD Randall Bold Operating Costs & Water Samples 118, CCWD Water Purchases for December 191, CDM Smith Facilities Plan Update/Map Update/Reimb Exp Delta Coves 21, City of Brentwood Reimb Expenses - S9426/S9033/S9461/S51CL/Delta Coves 1, Comcast Reimb Expense - Delta Coves Credit Consulting Services Inc Office - Collection Expense for December Conduent Business Services LLC Sensus Analysis File for the Meter Reading System 1, Delta Diablo Janitorial Office - Janitorial Services Eagle Business Forms Inc Office Supplies - Dan's Business Cards Freedlun Hydroseeding Refund Overpay Water Account Mario and Linda Gutierrez Refund Overpay Water Account Guy Reed Trucking Maint T&D - Base Rock 4, HD Supply Construction GO T&D - Plate Compactor 1, Hill Brothers Chemical Co Chemicals for Blending - Ammonia 1, Hunt and Sons Inc Auto - Gas J&M Inc Refund Overpay Water Account 6, JW Backhoe & Construction Inc Maint T&D - Highwood/Robinwood/Wildcat/Wells Rd/Empire 50, K. Lakshmanaperumal Refund Overpay Water Account Lehr Reimb Exp S Chuck Linn Retiree Health Benefits Luhdorff & Scalmanini Groundwater Explore & Monitor/Reimb Exp - Delta Coves 12, Estate of Rosalba Macias Refund Overpay Water Account MUNCPAs Accounting - Final Invoice for Audit Fiscal Year End , McCampbell Analytical Inc Reimb Exp - Delta Coves Sampling 5, NCBPA Membership Renewal for Nacho Mendoza Neofunds by Neopost Office - Postage Meter Monies Mt Diablo Resource Recovery GO Corpyard - Garbage Service Trish O'Connell Refund Overpay Water Account Oakley Ace Hardware GO CY-Hole Saw Blade/Clamps/Cleaner/Fasteners/Rope Pacific Gas & Electric Co Utilities - Office/T&D/Reservoir 2/Plant 6, Pacific Gas & Electric Co Utilities - M24/M25/M26/M Pacific Gas & Electric Co Utilities - Stonecreek and Glen Park Wells 6, Brian Panos Office - District Logo Jackets for Dan Jeffrey D Polisner Legal Expense 4, Rauch Communications Consultant Website Redesign & Maintenance 4, Carolyn Richmond Refund Overpay Water Account Roberts & Brune Co Maint T&D - Brass Nipples Royal Brass Inc GO Sup T&D - Bushings and Liquid Gauge Scheer Security Reimb Exp-Delta Coves & Trouble Shoot Remote Camera

60 DIABLO WATER DISTRICT WARRANT REGISTER JANUARY 23, 2019 PAGE 2 CK# PAYABLE TO FOR AMOUNT Matthew Seward Refund Over Pay Water Account Shred It USA LLC Office Maint Agreement - Shredding Service Richard Silva Refund Over Pay Water Account SWRCB Drinking Water Program Water System Fees FY 18/19 33, Tractor Supply Co GO CY - Ratchet Wrench/Rope & Maint Res - Goat Food Paul Urenda Jr. Retiree Health Benefits Watersavers Irrigation Maint T&D - Fittings & GO CY - Wood Stakes Water Wise Pro Training Training for Gina Padilla and JP Herrera TOTAL WARRANTS 539, The foregoing Accounts Payable Warrants through for January 2019 are hereby approved for payment. General Manager Director Director Director Director Director Signatures Required: General Manager and minimum of three (3) Directors

61 DIABLO WATER DISTRICT MONTHLY FINANCIAL REPORT FOR PERIOD DECEMBER 1, 2018 TO DECEMBER 31, 2018 Balance as of November 30, 2018 $8,807, Receipts, December 2018 Operating 1,095, Non-Operating (MERA, Admin, Inspection & Eng Fees & Contract Services) 18, Facilities Reserve 95, Interest General 3, MERA Facilities Reserve 3, Investment activity (+ or -) (653.28) Disbursements, December 2018 Operating (1,079,130.26) Facilities Reserve (73,515.36) Quarterly Bank Analysis Charges 0.00 Balance as of December 31, 2018 $8,871, FUNDS (as of close of business on December 31, 2018) AMOUNT District General Fund 2,417, Restricted funds 2013 Series Held in Trust by Union Bank 495, Series Held in Trust by Union Bank 281, Rate Stabilization Fund 1,000, Facilities Reserve 3,081, Main Extension Reimbursement 211, South Park Well System 266, Knightsen Well System (M25) 4, Beacon West Well System (M26) 43, Willow Park Marnia Well System (M27) 13, Rock Island Well System 125, Customer Deposits 302, Developer Admin, Inspection & Eng Deposit Totals (6,133.85) Current Active Projects $ 27, Projects on Hold $ 19, Project for Tracking Purposes Only $ (12,149.63) Accidents Pending Collection $ (12,841.06) Accidents Uncollectible $ (27,800.08) Subdivision #4990 Phase 3 Bond Deposit 300, Carol Lane Maintenance Bond 12, Carol Lane Perform, Labor & Materials Bond 90, Carol Lane Maintenance Bond 15, Substandard Street Investment Future Relocation of Bethel Island Road Offsite Waterline 192, Laurel Woods change of street grade 23, District's Portion of Investment TOTAL $8,871,917.87

62 DIABLO WATER DISTRICT MONTHLY FINANCIAL REPORT FOR PERIOD DECEMBER 1, 2018 TO DECEMBER 31, 2018 PAGE 2 INVESTMENTS/BANK ACCOUNTS (as of close of business on December 31, 2018) PAR RATE OF MARKET INSTITUTION VALUE INTEREST VALUE California Local Agency Investment Fund * ,611, Bank of the West, General Checking Account * 2,538, UBS EM Value with Interest Earnings 492, MD 08/02/ B61 Sallie Mae Bank UT US/CD 245, MD 08/09/ F4 Capital One Bank VA US/CD 110, MD 08/30/ PNS2 Goldman Sachs Bank NY US/CD 145, Union Bank Held Union Bank - Value with Interest Earnings/Res Fund , MD 10/13/ K25 Capital One BK USA Natl Assn Glen Allen VA/CD 140, MD 10/14/ BR6 Wells Fargo BK NA Sioux Falls S D/CD 145, Union Bank of California Money Management Fund Series , Varies MBS RMB Held Bank of New York - Value with Interest Earnings 2,451, MD 10/17/ P8 State BK India New York NY/CD 125, MD 06/05/ WHZ4 Synchrony BK Retail/CD 158, MD 08/31/ LCE8 First Technology Federal Credit Union/CD 245, MD 05/05/ CE0 Worlds Foremost BK Sydney/CD 200, MD 05/25/21 313G3NL5 Federal Natl Mtg Assn NTS - Rated AA+ 400, MD 09/07/ GET6 Ally Bk Sandy Utah/CD 240, MD 02/24/ J8 State BK India New York NY/CD 120, MD 03/01/ FE1 Wells Fargo BK NA Sioux Falls S D/CD 100, MD 04/05/ DN38 American Express Centurion/CD 240, MD 11/30/ RAD8 Mtn. Amer Fed Cr Un West Utah/CD 200, MD 12/20/ RKZ3 Capital One Natl Assn Mclean VA/CD 230, MD 09/07/ KY2 First Bank of Highland/CD 240, Multibank Interest, Money Management Fund 15, MBS RMB Held Union Bank - Value with Interest Earnings/Res Fund , MD 08/29/ CFU9 American Express Fed SVGS BK Instl/CD 200, MD 11/29/ PTQ0 Goldman Sachs BK USA NY/CD 100, MD 11/23/ T24 Discover BK/CD 205, Union Bank of California Money Management Fund Series , Varies TOTAL $8,871, * Demand Account It is expected that there are sufficient funds to meet anticipated expenses for the next 6 months. ACRONYMS ADMIN - Administration Assn - Association BK - Bank CD - Certificate of Deposit CERBT - California Employers Retiree Benefit Trust ENG - Engineering MBS - Multi-Bank Securities, Inc MD - Maturity Date MERA - Main Extension Reimbursement Account Mtg - Meeting Natl - National RES - Reserve UBS - UBS Financial Services, Incorporated

63 DIABLO WATER DISTRICT MONTHLY FINANCIAL REPORT FOR PERIOD DECEMBER 1, 2018 TO DECEMBER 31, 2018 PAGE 3 HELD IN TRUST BY DIABLO WATER DISTRICT For Board of Directors Information Only (as of close of business on December 31, 2018) RATE OF MARKET INSTITUTION INTEREST VALUE Lincoln National, Deferred Compensation Varies 887, CERBT Funds (Updated Quarterly) (6.987%) year/year 891, TOTAL $1,778, Deferred Compensation is pre tax money that has been deposited by District employees into the District's 457 Deferred Compensation Plan. All monies in the plan are held in trust by the District for the exclusive benefit of each employee. CERBT Funds - California Employers' Retiree Trust Fund is administered by CalPERS. The interest earned on the District's balance in this Trust Fund is used to pay the Diablo Water District portion of retiree medical benefit premiums. CalPERS pays the District each July from the Trust Fund for the previous year's total cost of retiree medical benefit premiums.

64 COUNTY WELL FUND BALANCES Knightsen (M25) Expenses Income Total Fund Balance FY 08/09 (7,727.20) 6, (24,622.61) FY 09/10 (10,755.47) 6, (28,780.40) FY 10/11 (14,038.87) 6, (36,383.00) FY 11/12 (12,396.89) 8, (40,493.39) FY 12/13 (10,137.89) 8, (41,747.44) FY 13/14 (6,200.51) 12, (35,675.89) FY 14/15 (6,932.58) 15, (26,953.06) FY 15/16 (8,416.99) 16, (18,494.43) FY 16/17 (8,785.34) 17, (10,006.03) FY 17/18 (7,922.88) 20, , FY 18/19 (Thru Dec) (7,003.00) 9, , Beacon West (M26) Expenses Income Total Fund Balance FY 08/09 (14,594.32) 19, , FY 09/10 (31,228.25) 20, , FY 10/11 (21,189.06) 21, , FY 11/12 (26,446.02) 22, , FY 12/13 (11,276.42) 22, , FY 13/14 (7,640.39) 26, , FY 14/15 (8,057.01) 26, , FY 15/16 (15,355.08) 26, , FY 16/17 (11,263.96) 26, , FY 17/18 (155,935.65) 105, , FY 18/19 (Thru Dec) (10,162.45) 14, , *Borrowed $80,000 from Fac Res Willow Park (M27) Expenses Income Total Fund Balance FY 08/09 (22,923.46) 37, , FY 09/10 (18,061.81) 36, , FY 10/11 (23,516.61) 36, , FY 11/12 (24,035.34) 36, , FY 12/13 (47,529.75) 34, , FY 13/14 (49,171.53) 39, , FY 14/15 (13,720.87) 40, , FY 15/16 (15,238.28) 40, , FY 16/17 (71,763.56) 40, , FY 17/18 (127,061.18) 42, , FY 18/19 (Thru Dec) (77,311.83) 24, , FY = Fiscal Year Rock Island (RI) Expenses Income Total Fund Balance FY 08/09 (5,162.99) 31, , FY 09/10 (35,354.24) , FY 10/ , FY 11/ , FY 12/ , FY 13/ , FY 14/ , FY 15/ , FY 16/ , FY 17/ , , FY 18/19 (Thru Dec) , , South Park (M24) Expenses Income Total Fund Balance FY 07/08 (21,865.37) 0.00 (21,865.37) FY 08/09 (8,212.97) 76, , FY 09/10 (6,267.75) 53, , FY 10/11 (24,731.90) 53, , FY 11/12 (18,224.35) 31, , FY 12/13 (17,341.44) 41, , FY 13/14 (15,339.36) 39, , FY 14/15 (18,281.94) 36, , FY 15/16 (31,991.77) 28, , FY 16/17 (16,908.12) 36, , FY 17/18 (19,152.52) 41, , FY 18/19 (Thru Dec) (11,504.73) 37, ,621.81

65 DIABLO WATER DISTRICT FUNDS AVAILABLE Million $ DEC JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC Fac Res Gen Oper