Regular Board Meeting
May 25, 2023
Item 8: Proposed Fiscal Year
2023/24 Budget
5/25/22 2
Item 8: Proposed FY 2023/24 Budget
• Recommendation:
• Review Proposed FY 2023/24 Budget and Schedule Adoption for June 29, 2023 Meeting.
5/25/22 3
Item 8: Proposed FY 2023/24 Budget
FY 2022/23 Year-End
Estimates
• Expenditure Variances
• Staffing costs - $239K
favorable
• Unplanned bad debt
accrual - $852K
unfavorable (may be
less)
• Interest Expense - $485
unfavorable
• Ending Change in Net
Position meets 5%
Operating Reserve
Contribution
5/25/22 4
Budget and Forecast
Items
Mid-Year
Adjust/Approved
Budget
Year-End Estimate
$ Variance - Mid-Year Budget vs.
Forecast
Fav/(Unf)
TOTAL REVENUES $96,825,523 $97,203,350 $377,827
TOTAL OPERATING EXPENSES 89,845,542 90,449,730 (604,188) NET INTEREST EXPENSE/(INCOME) 565,447 1,050,000 (484,553) CHANGE IN NET POSITION $6,414,534 $5,703,620 ($710,914) Net Position at the beginning of period ($3,333,642) ($3,333,642) Net Position at the end of period $3,080,892 $2,369,978 ($710,914) Current Fiscal Year (FY2023)
FY2022-2023
Item 8: Proposed FY 2023/23 Budget
• FY 23/24 Proposed Budget Assumptions
• Revenues based on current adopted rates
• Power supply costs based on actual executed contracts and May forward price curve
• Consulting Services based on approved contracts
• Priorities & Goals
• Financial Stability
• Regulatory Compliance
• Successful Expansion in Oceanside and Vista
5/25/22 5
Item 8: Proposed FY 2023/24 Budget
FY 2023/24 Proposed
Budget
• Increase in revenue due to • Full Year Escondido & San Marcos Expansion
• April 2024 Oceanside and Vista
Expansion
• Increase in expenditure due
to• Energy purchases to serve expanded service territory, higher energy/RA prices
• Admin Costs re: Full Time
Staffing
• Change in Net Position
Meets 5% Operating Reserve
Target
5/25/22 6
Budget and Forecast FY2023-2024 FY2023-2024
Items Year-End Estimate Proposed Budget
$ Change - FY23 Year-End Estimate vs.
Proposed Budge
TOTAL REVENUES $97,203,350 $230,915,000 $133,711,650
TOTAL OPERATING EXPENSES 90,449,730 212,661,205 122,211,475 NET INTEREST EXPENSE/(INCOME) 1,050,000 700,000 (350,000) CHANGE IN NET POSITION $5,703,620 $17,553,795 $11,850,175 Net Position at the beginning of period ($3,333,642) $2,369,978 Net Position at the end of period $2,369,978 $19,923,773 FY2022-2023
Item 8: Proposed FY 2023/24 Budget
• Proposed Positions – Transition from Contract to Permanent • Chief Executive Officer
• Board Secretary
• Positions Approved FY 2022/23
• Accounts Services/Program Manager
• Procurement Manager
• Regulatory Analyst
• Fund Repayments of Loans
• JPMorgan - $5M
• Startup loans from Carlsbad, Del Mar & Solana Beach
5/25/22 7
Item 8: Proposed FY 2023/24 Budget
5/25/22 8
CEA Board of
Directors
Chief Executive
Officer
Account Services
& Program
Manager
Procurement
Manager
Regulatory
Analyst
General Counsel CFO/Treasurer
Board Secretary
Board Clerk
5/25/22 9
Budget and Forecast FY2023-2024
Items
Mid-Year
Adjust/Approved
Budget
Year-End Estimate Proposed Budget
TOTAL REVENUES $96,825,523 $97,203,350 $230,915,000
OPERATING EXPENSES
Power Supply 86,635,982 86,662,905 200,000,000
Data Management/Call Center 1,151,180 1,100,000 2,500,000 Staffing/Consultants 382,900 290,500 3,000,000
Legal Services 335,000 350,000 467,500
Professional Services 1,002,100 934,200 1,448,885
Audit Services 10,000 8,900 10,000
Software & Licenses 15,100 9,325 15,000
Memberships & Dues 121,000 90,000 292,040
G&A (includes Bad Debt expense) 192,280 1,003,900 4,927,780 TOTAL OPERATING EXPENSES 89,845,542 90,449,730 212,661,205 OPERATING MARGIN $6,979,981 $6,753,620 $18,253,795
FINANCING
NET INTEREST EXPENSE/(INCOME) 565,447 1,050,000 700,000 CHANGE IN NET POSITION $6,414,534 $5,703,620 $17,553,795 Net Position at the beginning of period ($3,333,642) ($3,333,642) $2,369,978 Net Position at the end of period $3,080,892 $2,369,978 $19,923,773 Repaid to Member Agencies 504,017
Repaid to Line of Credit (JP Morgan) 5,000,000
Total Outflows - Board Approval 218,865,222
FY2022-2023
• Community Advisory Committee Recommendations for
Consideration:
• Community Solar/Feed-in-Tariff Program
• Home Electrification Program
• Grant Writer
• Staff Recommendation
• Board direct staff develop specific program and budget request and bring to Board for approval during FY 23/24
5/25/22 10
Item 8: Proposed FY 2023/24 Budget
• Next Step
• June 29, 2023 Regular Board Meeting – Budget Adoption 5/25/22 11
Item 8: Proposed FY 2023/24 Budget
Questions/Discussion
5/25/22 12
Item 9: Employee Handbook,
Drug & Alcohol Policy and
Employee Benefits
5/25/22 13
Item 9: Proposed Employee Benefits
• Recommendation:
• Approve CEA Employee Handbook.
• Approve CEA Drug and Alcohol Policy
• Approve CEA Employee Benefits Policy
5/25/22 14
Item 9: Proposed Employee Benefits
• Employee Handbook
• Based on existing best practices
• Current labor laws
• General Counsel review
• Drug & Alcohol Policy
• Based on current labor laws
• Existing Best Practices
• General Counsel Review
5/25/22 15
Item 9: Proposed Employee Benefits
• Staff Recommendation Based on Survey:
• Member City Benefit Packages
• San Diego Community Power
• Similar CCAs throughout state
5/25/22 16
Item 9: Proposed Employee Benefits
• Proposed comprehensive benefits plan including:
• Medical Insurance
• Up to 3 options
• Dental Insurance
• Vision Insurance
• Recommend CEA offer pay 100% Employee and 50% Dependent premiums 5/25/22 17
Item 9: Proposed Employee Benefits
• Other Benefits:
• Basic Life Insurance (with option for employee-paid supplemental) • Long-term Disability Insurance
• Retirement
• Social Security (Employer and Employee contribution)
• Not PERS Agency – no long-term liability
• 457(b) Employee Contribution to IRS Maximum
• 401(a) Employer Contribution
• Match up to 5% of 457 Employee Contribution
• Employer 5% Contribution regardless of Employee Contribution 5/25/22 18
Item 9: Proposed Employee Benefits
• Paid-Time Off
• Vacation
• Upon Hire – 15 days per year
• Year 3 – 6 – 20 days per year
• Year 7 & after – 25 days per year
• Sick – 8 hours per month/maximum 144 hours accrual
• Holidays – 10 defined days and Winter Break (December 24 to December 31) • Tech Allowance
• Company-provided standard equipment
• $100/month allowance for cell phone, internet, etc.
• Remote Work Allowance • To be defined at a later time 5/25/22 19
Item 9: Proposed Employee Benefits
• Cost Estimate:
• Costs will vary depending on each Employee’s dependent coverage and employee salary (for retirement contribution calculation).
• Examples:
• Executive: range of $40,000 - $55,000 per year
• Analyst: range of $25,000 - $40,000 per year
5/25/22 20
Questions/Discussion
5/25/22 21