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Home My WebLink AboutPP-FY20_Budget_Kick-OffMWMC Regional Wastewater Program FY 2019-20 Budget Kick-Off Key Outcomes & Performance Indicators MWMC Budget Kick-Off January 11, 2019 Jan 11, 2019 Budget Kick-Off : Key Outcomes and Performance Measures Feb 8, 2019 Draft Capital Program Mar 8, 2019 FY 2019-20 Presentation and Discussion Operating Budget Revenues and Reserves Rate Scenarios Apr 12, 2019 Budget and User Rate Public Hearings and Options to Adopt MWMC FY 2019-20 Budget and Rate Decision Schedule Matt MWMC Commission meetings MWMC Budget Kick-Off January 11, 2019 FY 2018-19 mid-year budget review Key outcomes status and work plan Major issues and challenges ahead Budget assumptions for FY 2019-20 MWMC FY 2019-20 budget schedule Presentation Objectives FY 2019-20 Matt MWMC Budget Kick-Off January 11, 2019 Budget and Rate Highlights 2.5% rate increase in FY 2018-19 Revenues are on target YTD Expenditures are below budget YTD Maintaining appropriate reserve balances Paid off two SRF loans Current Mid-Year Review FY 2018-19 Katherine SRF – Paid off two SRF loans at $5.1M combined, resulting in a Saving of $1.16 Million in financing costs. At 3.27% and 3.15% MWMC Budget Kick-Off January 11, 2019 Driven by MWMC Key Outcomes: High Environmental Standards Effective and Efficient Fiscal Management Successful Intergovernmental Partnership Maximize Reliability and Useful Life of Capital Assets and Infrastructure Public Awareness and Understanding Work Plan and Budget FY 2019-20 Matt Each year we look for changes to measures, to make incremental changes so outcomes/indicators are more meaningful MWMC Budget Kick-Off January 11, 2019 Major Issues / Challenges Ahead Budget and work programs will continue to be driven by: Current capital program requirements Active projects Planned investments in capital improvements Aging infrastructure / asset management Meeting regulatory / permit requirements Planning for a NPDES Permit renewal Temperature / toxics / mass loads Matt & Dave Capital Program (Matt) – will be talking in more detail next month Active Projects – Digester, O&M Buildings, Electrical Cables Resiliency Planning Aging infrastructure / asset management (Dave) Original regional infrastructure approaching 40 yrs old – capturing all assets in condition assessment and ongoing rehab to maximize useful life Application of asset management technologies is the top technology trend nationwide (APWA) Regulatory & Permit Permit on administrative extension Thermal load obligations Temperature Recycled Water Program; Pure Water Partners MWMC Budget Kick-Off January 11, 2019 Key Outcomes Status and Work Plan Key Outcomes Environmental Standards Performance of permit requirements Biosolids Management Environmental management system Financial Management Achieving clean financial audits Maintaining favorable bond rating Updating Financial Plan policies Details on Attachment 1, Page 2 DAVE/Katherine Environmental Standards NPDES Wastewater/Stormwater Air Discharge Permit (flow, TSS/CBOD removal) Biosolids pollutant concentrations MWMC target - half of EPA allowable pollutants for exceptional quality EMS – ISO 140001 conformance Financial Management Demonstrated in part by audited financial statements as presented this morning Maintaining AA (double A) uninsured bond rating which demonstrates strong creditworthiness that is based on the MWMC’s ability to repay its debt. FP target for bond rating is upgraded from A to A+ in the proposed 2019 Financial Plan. Updated 2019 Financial Plan adoption is currently scheduled for the Commission meeting in March. MWMC Budget Kick-Off January 11, 2019 Key Outcomes Status and Work Plan Key Outcomes (continued) Intergovernmental Partnership Pretreatment Programs Capacity Management O&M (CMOM) Community Presentations Reliability/useful life of assets Maintenance benchmarks Asset Management and plan update Details on Attachment 1, Page 3 Matt / Dave Intergovernmental Partnership Strive to maintain high level of collaboration / coordination of EUG & SPR pretreatment programs Reliability/useful life of assets Tracking and achieving perf goals to maximize life and reliability Explanation and examples of PMs, CMs and performance goals, emergency maintenance Training, formalized asset management plan, implementation and annual plan update MWMC Budget Kick-Off January 11, 2019 Key Outcomes Status and Work Plan Key Outcomes (continued) Public Awareness Community Survey - Fall 2019 Communication Plan Update – Spring 2020 Social Media - strategies to grow followers Pollution prevention campaigns / sponsorships Reaching 40% of residents Details on Attachment 1, Page 4 Matt Communications Plan Update is based on input from survey results MWMC Budget Kick-Off January 11, 2019 FY 2019-20 Budget and Rate Assumptions Personnel Services Based on contracted salary and benefit programs Materials and Services Contractual services Operating and material expenses Staff continues to seek operational efficiencies Capital Outlay Katherine Regional Program Combined – PS and M&S Combined – Operating Budget Assumption: 3.0% increase Personnel Services - Budget Assumption: 3.0% increase O&M expenses are related to ongoing maintenance of aging infrastructure and the maintenance of expansion of infrastructure. Budget assumption: 2.5% increase Capital Outlay – Eugene new purchases over $5,000, for example motorized vehicles/equipment. MWMC Budget Kick-Off January 11, 2019 FY 2019-20 Budget and Rate Assumptions Assumes stable revenues Strategic transfers to Capital Fund Capital Improvement Program Plan Proposed CIP Budget includes 4% annual inflationary Equipment Replacement Reserve Reserves funded based on the Financial Plan and capital program requirements Incremental and moderate rate changes KATHERINE - FY 2019-20 assumptions User fees are on targets YTD - User fee collection rates are strong YTD New development activity has been positive YTD $14 M transferred from the Operating Fund to the Capital Fund in the current FY. The 4% annual inflationary factor is applied to the Capital Plan annually The ENR Construction Cost Index reflects an average annual inflation of about 3.5% for the period of 2004 when the MWMC Facilities Plan was adopted to present. In calendar 2017 the CCI included a 3.9% change, and most recently 2018 calendar year includes a 3.0%, which we have rounded to 4%. Project budgets/timing are programmed by phase when appropriate. For example Designed in year 1 and Construction in year 2. To smooth rates changes. As opposed to front loading the budgets ER Replacement Reserve –balance is $12.5 M currently. $1M was transferred from the Operating Fund to the Equipment Replacement Reserve in the current FY Rate changes – incremental and moderate rate changes MWMC Budget Kick-Off January 11, 2019 Jan 11, 2019 Budget Kick-Off : Key Outcomes and Performance Measures Feb 8, 2019 Draft Capital Program Mar 8, 2019 FY 2019-20 Presentation and Discussion Operating Budget Revenues and Reserves Rate Scenarios Apr 12, 2019 Budget and User Rate Public Hearings and Options to Adopt MWMC FY 2019-20 Budget and Rate Decision Schedule Matt MWMC Commission meetings MWMC Budget Kick-Off January 11, 2019 MWMC FY 2019-20 Budget and Rate Decision Schedule MWMC Budget & CIP Ratification by: May 6, 2019 - Springfield City Council May 13, 2019 - Eugene City Council May 14, 2019 - Lane County Board of Commissioners June 14, 2019 Final Ratification of FY 2019-20 Budget, Rates & Capital Programs by the MWMC Katherine MWMC Budget Kick-Off January 11, 2019 Discussion / Comments Action Requested: Provide input to staff regarding the purpose statement, key outcomes, and performance indicators. Katherine MWMC Budget Kick-Off January 11, 2019 MWMC Budget Kick-Off January 11, 2019 MWMC Budget Kick-Off January 11, 2019