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Home My WebLink AboutFY19 Budget Kick-OffMWMC Regional Wastewater Program FY 2018-19 Budget Kick-Off Key Outcomes & Performance Indicators MATT FY 2018-19 Budget Kickoff January 12, 2018 MWMC FY 2018-19 Budget and Rate Decision Schedule Jan 12, 2018 Budget Kick-Off : Key Outcomes and Performance Measures Feb 9, 2018 Draft Capital Program Mar 9, 2018 FY 2018-19 Presentation and Discussion Operating Budget Revenues and Reserves Rate Scenarios Apr 13, 2018 Budget and User Rate Public Hearings and Options to Adopt MATT MWMC Commission meetings FY 2018-19 Budget Kickoff January 12, 2018 Presentation Objectives FY 2017-18 mid-year budget review Key outcomes status and work plan Major issues and challenges ahead Budget assumptions for FY 2018-19 MWMC FY 2018-19 budget schedule MATT FY 2018-19 Budget Kickoff January 12, 2018 FY 2017-18 Mid-Year Review Budget and Rate Highlights 3% rate increase in FY 2017-18 Revenues are on target YTD Expenditures are below budget YTD Maintaining appropriate reserve balances Katherine Adopted 3.0% rate increase effective July 1, 2017 Resulted in an increase of $0.76 monthly for the typical residential customer, from $25.09 to $25.85 monthly assuming 5,000 gallons of wastewater treated. Residential (average usage): Springfield 4,270 gallons = $23.96 / monthly (prior year 4,500 gallons, now 230 gallons less monthly) Eugene 3,700 gallons = $22.49 / monthly (prior year 3,800 gallons, now 100 gallons less monthly) DIFF of 570 gallons = $1.47 / monthly Revenues Total Revenues YTD are on target, with Septage Revenues performing above prior year first quarter by about 50%, interest earning are performing above estimates, and SDC Revenues are performing slightly above target YTD Expenditures Timing of expenditures, and Debt Service $5.5 M, includes $4 M bonds and $1.5 M SRF loans Reserves Capital and SDC Reserves at $41.5 M; Equipment Replacement Reserves at $12 M Operating Reserves at about $5 M, Rate Stability Reserve at $2 M; Rate Stabilization Reserve at $2 M SRF Loan Reserves at about $670,000; Insurance Reserve is at $515,000 FY 2018-19 Budget Kickoff January 12, 2018 Work Plan Directed by MWMC Key Outcomes Work Plan Directed by MWMC Key Outcomes High Environmental Standards Effective and Efficient Fiscal Management Successful Intergovernmental Partnership Maximize reliability and useful life of regional assets and infrastructure Public Awareness and Understanding MATT Note: Each year look for changes/tweaks to measures to make incremental changes so outcomes/indicators more meaningful FY 2018-19 Budget Kickoff January 12, 2018 Major Issues/Challenges Ahead Budget and work programs will continue to be driven by: Current capital program requirements Continuing to replenish capital reserves Aging Infrastructure Active Projects Meeting regulatory and permit requirements Planning for a NPDES Permit renewal Temperature / toxics / mass loads MATT Capital Program – will be talking in more detail next month Debt Service - includes debt coverage requirements Aging Infrastructure – Plant approaching 40 years old – changing way we think about planning Active Projects – Digester, O&M, Electrical Cables Regulatory & Permit Permit on administrative extension Thermal load obligations Temperature Recycled Water Program; Pure Water Partners FY 2018-19 Budget Kickoff January 12, 2018 Key Outcomes Status and Work Plan Public Works Day DAVE Phil and Shawn – sampling Public Works Day FY 2018-19 Budget Kickoff January 12, 2018 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 page 3 of Key Outcomes and Performance Measures Memo 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 A. Updating FP policies FY 2018-19 Budget Kickoff January 12, 2018 Key Outcomes Status and Work Plan Key Outcomes (continued) Intergovernmental Partnership Pretreatment Programs IGA Update Reliability/useful life of assets Maintenance benchmarks Asset Management work plan development Details on page 4 of Key Outcomes and Performance Measures Memo 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 WERF’s SAM GAP Analysis, IPWEA professional training, work plan development and implementation FY 2018-19 Budget Kickoff January 12, 2018 Key Outcomes Status and Work Plan Key Outcomes (continued) Public Awareness Social Media Strategies to grow Facebook and Twitter followers MWMC e-newsletter Updating design Increasing distribution to monthly Pollution prevention campaigns & sponsorships Increasing sponsorships Details on page 5 of Key Outcomes and Performance Measures Memo MATT Public Awareness – FY 2018-19 Budget Kickoff January 12, 2018 FY 2018-19 Budget and Rate Assumptions Personnel Services Based on contracted salary and benefit programs Materials and Services Operating and materials expenses Staff continues to seek operational efficiencies to moderate rate changes Capital Outlay KATHERINE Regional Program Combined – PS and M&S Combined – Operating Budget Assumption: 3.0% increase Personnel Services - Budget Assumption: 3.25% increase Springfield – The City conducts a market survey about every 3-years. Results of the current study will be implemented in July 1, 2018. Outcome of the Market adjustments will vary based on position classification. With no additional COLA adjustments. PERS Contribution Rates - are projected to increase significantly. 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. FY 2018-19 Budget Kickoff January 12, 2018 FY 2018-19 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 2018-19 assumptions User fees are on targets YTD User fee collection rates are strong YTD New development activity is 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 includes a 3.9% change over 2016, 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 – The annual contribution is developed so that all projected replacements will be funded over a 20-year period, and at the end of the 20-year period, the reserve will contain replacement funds for all equipment, projected to be in use, at that time. ER Reserve balance is $12 M currently. $850,000 transferred from the Operating Fund to the Equipment Replacement Reserve current FY Rate changes – incremental and moderate rate changes FY 2018-19 Budget Kickoff January 12, 2018 MWMC FY 2018-19 Budget and Rate Decision Schedule Jan 12, 2018 Budget Kick-Off : Key Outcomes and Performance Measures Feb 9, 2018 Draft Capital Program Mar 9, 2018 FY 2018-19 Presentation and Discussion Operating Budget Revenues and Reserves Rate Scenarios Apr 13, 2018 Budget and User Rate Public Hearings and Options to Adopt KATHERINE MWMC Commission meetings FY 2018-19 Budget Kickoff January 12, 2018 MWMC FY 2018-19 Budget Adoption Schedule MWMC Budget & CIP Ratification by: May 7, 2018 - Springfield City Council May 14, 2018 - Eugene City Council May 15, 2018 - Lane County Board of Commissioners June 8, 2018 Final Ratification of FY 2018-19 Budget, Rates & Capital Programs by MWMC KATHERINE Budget Adoption Schedule Springfield Monday, May 7 at 7:00 pm Eugene Monday, May 14 at 7:30 pm Lane Co Tues, May 15 9:00 am to noon (time specific pending) FY 2018-19 Budget Kickoff January 12, 2018 Questions and Comments Water Pollution Control Facility KATHERINE Opportunity for questions, comments and direction from the Commission FY 2018-19 Budget Kickoff January 12, 2018