SFPUC
FY2021-22 2nd Quarter Budget Report
Laura Busch
Budget Director
March 8, 2022
2 • Positive operating results projected for Power and CleanPowerSF and operating shortfalls projected for Water and Wastewater. • Water and Wastewater: lower revenues due to:
• Water conservation efforts due to drought, offset by 5% drought surcharge effective April 2022
• Delayed economic recovery; temporary customer assistance programs
• Power: higher wholesale revenues from increased energy prices, higher retail revenues due to increased volumes; offset by increased distribution, power purchase costs
• CleanPowerSF: budget amended to incorporate rate increase and offsetting higher cost of power purchase. Savings driven by vacant positions.
• Year-end financial results projected to meet or exceed policy targets FY 2021-22 Q2 Report Summary
Sales Revenue Shortfalls Increased in Q2
• Water Sales $8.3M lower vs. Q1
• Water conservation trends are driving lower revenues
• Retail water v olumes projected to be 6% below budget vs. 3.7% in Q1 • Wholesale volumes projected to be 8.9% below budget vs. 6.6% in Q1 • Offsetting lower projected water sales volumes in Q2 is a $3.9M increase from s
tate COVID-19 grants for debt forgiveness vs. Q1
• Wastewater Sales $5M lower vs. Q1
• Water conservation trends are driving lower wastewater revenues; wastewater bi
llable volumes are projected to be 3.7% below budget vs. 2.4% in Q1 • Incorporated into Q2 and Q1 Water and Wastewater variance reports is a 5% retail dr
ought surcharge commencing April 1
3 FY 2021-22 Sales
Revenue Shortfall Retail Wholesale Total
Water ($12.4M), 4% ($24.1M), 9% ($36.5M), 6%
Wastewater ($30.4M), 8% - ($30.4M), 8%
4 • Net operating result: ($32.6M)
• Total sources ($38.7M), offset by $6.0M in cost savings Sources
• ($12.4M), 3.8% retail revenues
• ($24.1M), 8.9% wholesale revenues
• ($2.3M), 3.8% non-operating revenues
Uses
• $2.5M, 2.3% salaries and benefits
• $1.5M, 2.2% overhead
• $1.0M, 6.2% services of other city departments
• $0.8M, 1.6% debt service
• $0.3M, 0.5% non-personnel services, materials & supplies FY 2021-22 Water Budgetary Variances
5 • Net operating result: ($25.0M)
• Total sources down ($30.7M), offset by $5.8M savings
• $4.9M reduction in fund balance due to legal settlement Sources
• ($30.4M), 7.8% sewer service charges
• ($0.4M), 2.9% non-operating revenues
Uses
• $2.7M, 3.2% salaries and benefits
• $1.5M, 5.2% non-personnel services
• $1.1M, 2.5% overhead
• $0.5M, 3.4% materials and supplies
FY 2021-22 Wastewater Budgetary
Variances
6 • Net operating result: $12.6M
• Total sources up $4.2M, and $8.4M in cost savings
Sources
• ($3.7M), 20.1% gas & steam sales
• $3.9M, 2.9% retail sales
• $3.0M, 3.0% wholesale sales
• $1.0M, 9.0% non-operating revenues
Uses
• $7.1M, 7.8% power and gas & steam savings
• $0.8M, 1.5% non-personnel services
• $0.5M, 2.0% overhead
* Note: curtailment could lead to lower generation and wholesale sales, leading to increased power purchases to meet demand
FY 2021-22 Power Budgetary
Variances
7 • Net operating result: $3.3M
• Total sources down ($0.4M), offset by $3.7M in cost
savings
Sources
• ($0.8M), 80.0% interest income
• $0.4M, 0.2% higher power sales
Uses
• $1.8M, 22.1% salaries and benefits
• $1.2M, 0.5% power purchase
• $0.5M, 4.0% non-personnel services
FY 2021-22 CleanPowerSF Budgetary
Variances
8 Key Financial Ratios
Fund Balance Reserve
Water Wastewater Power
• 25%-68% of Annual
Operating Uses
63.1% 65.4% 42.5%
Debt Service Coverage
Reserve
• Indenture Basis ≥ 1.35x 1.7 3.7 23.3
• Current Basis ≥ 1.10x 1.1 1.8 9.6
9 OUR MISSION: To provide our customers with high-quality, efficient and reliable water, power and sewer services in a manner that values environmental and community interests and sustains the resources entrusted to our care. 525 Golden Gate Avenue, 13th Floor
San Francisco, CA 94102
T 415.934.5707
F 415.554.1877
Date: Mar
ch 8, 2022
To: Commissioner Anson Moran, President
Commissioner Newsha Ajami, Vice President
Commissioner Sophie Maxwell
Commissioner Tim Paulson
Through: Dennis J. Herrera, General Manager
From: Charles Perl, Deputy Chief Financial Officer
Subject: SFPUC FY 2021-22 Second Quarter Budgetary Report through December 31, 2021
The FY 2021-22 second quarter budgetary reports are attached for the three Enterprises and CleanPowerSF, with high- level changes to revenues and expenses summarized in the following table:
Beginning
Available
Fund
Balance
Fund
Balance
Budgeted
to be Used
FY 2021-22 Operations
Projected
Year End
Available
Fund
Balance
Projected
Sources
Projected
Uses
(excluding
Capital &
General
Reserve)
Net
Operating
Results
Surplus /
(Shortfall)
General
Reserve
&
Project
Closeout
Water 254.2 (22.0) (38.7) 6.1 (32.6) - 199.6
Wastewater 185.7 (9.6) (30.7) 5.8 (25.0) - 146.1
Power 80.6 (7.1) 4.2 8.4 12.6 - 86.1
CleanPowerSF 73.4 (2.9) (0.4) 3.7 3.3 - 73.9
Summary:
• Positive operating results projected for Power and CleanPowerSF and operating shortfalls projected for Water and Wastewater. • Water and Wastewater: revenues are down from budget due to impact of water conservation efforts from drought assumptions and delayed economic recovery from COVID-19. Projections are worse than at Quarter 1. In both enterprises, revenue shortfalls include COVID-19 emergency customer assistance programs, offset by grants from the state COVID-19 utility debt forgiveness program. In addition, expenditures are projected to come in below budget due to vacant positions and projected year end savings in non-personnel expenses, materials and overhead.
• Fund bal
ance has been reduced by $4.9M in the Wastewater
enterprise due to legal settlements relating to floodwater claims from the 2014 storms. Such settlements can be paid directly from unappropriated fund balance per Appropriation Ordinance No. 165-20 (section 10.10).
• CleanPowerSF: The budget was revised to include the approved rate increases and the increased cost of power purchases driven by higher market energy costs. Revenue projections also include grants from the state COVID-19 utility debt forgiveness program.
In addition, labor and non labor savings are anticipated due to vacant positions and lower than anticipated budgeted
expenditures.
• Power: Retail revenues are higher due to increased sales volumes, largely attributed to SFO Airport. Revenues are projected to exceed the budget due to higher power prices, as well as higher water sales to Lawrence Livermore National Labs.
The surplus in wholesale revenues has decreased since the prior projection at Quarter 1 due to drier weather so far in 2022 leading to lower generation. Higher revenues are partially offset by increased CAISO power purchases driven by higher power
prices, as well as higher transmission and distribution costs.
These costs are offset by $4.0M power purchase contingency budget, as well as $5.6M in prior year unspent funds carried forward from FY 2020-21. The projection also includes the estimated cost of moving certain unmetered loads over to PG&E. • All enterprises are projected to meet financial policy minimums and coverage ratios at year end.
SF
PUC’s finance team is closely monitoring water and wastewater sales for FY 2021 -22 to determine impacts of continued economic weakness on the current year and will provide continue to provide update s to the Commission.
If you have questions, please contact me at [email protected].
CC:
M
asood Ordikhani, AGM, External Affairs, SFPUC
Barbara Hale, AGM, Power Enterprise, SFPUC
Alan Johanson, AGM, Infrastructure, SFPUC
Greg Norby, AGM, Wastewater Enterprise, SFPUC
Steve Ritchie, AGM, Water Enterprise, SFPUC
Ashley Groffenberger, Budget Director, Mayor’s Office
Ben Rosenfield, Controller
Atta
chments:
Appendix A Water Enterprise
Appendix B Wastewater Enterprise
Appendix C Hetch Hetchy Water & Power, including the Power Enterprise Appendix D CleanPowerSF
FY 2020-21
Actuals Original Budget
Revised
Budget
(includes
carryforwards)
Projection
(includes
carryforwards)
Variance
(Projection -
Revised Budget)
Sources
Retail Water Sales 285.9 328.1 328.2 315.8 (12.4) A Wholesale Water Sales 275.2 270.6 270.6 246.5 (24.1) B Interest Income 2.4 4.5 4.5 2.8 (1.7) C Rental Income 12.7 12.9 12.9 12.3 (0.6) D Miscellaneous Income 20.4 20.2 20.8 20.8 - Departmental Transfer Adjustment (44.2) (45.8) (45.8) (45.8) - Federal Bond Interest Subsidy 21.8 21.6 21.6 21.6 - Appropriated/Budgeted Use of Fund Balance 95.1 22.0 72.8 72.8 - Total Sources 669.3 634.0 685.5 646.8 (38.7) Operating Uses
Personnel 98.7 110.0 110.0 107.5 2.5 E Non-Personnel Services 17.2 24.6 35.8 35.7 0.1 Materials and Supplies 12.4 16.0 20.3 20.1 0.2 Equipment 3.2 3.1 9.6 9.6 - Light, Heat, and Power 9.8 10.4 10.6 10.6 - Overhead (SFPUC Bureaus) 48.4 59.8 69.0 67.5 1.5 F Services of Other Departments 14.4 14.7 16.1 15.1 1.0 G Debt Service 299.3 307.7 307.7 306.9 0.8 H Total Operating Uses 503.3 546.4 579.2 573.1 6.1 Net Operating Results 166.0 73.7 (32.6) Adjustments to Operating Fund Balance FY 2020-21
Actuals
Current Year
Transfers from
Operating
Total
Available
Funds
Projection
(current & future
years spending)
Project
Closeouts
Capital Projects 45.2 55.7 237.9 237.9 - Facilities Maintenance/Programmatic 22.9 32.0 50.0 50.0 - Total Adjustments to Operating Fund Balance $ 68.1 $ 87.7 $ 287.9 $ 287.9 $ - Available Fund Balance as of Fiscal Year-End $ 254.2 $ 199.6 Available Fund Balance, % of Operating Uses (I) 25-68% 112.0% 63.1% Debt Service Coverage (Year-End Budgetary Basis)
Indenture Basis (includes Available Fund Balance) (J) ≥ 1.35 1.99 1.95 1.74 Current Basis (K) ≥ 1.10 1.22 1.20 1.10 FY 2021-22
Appendix A
WATER ENTERPRISE OPERATING FUNDS
FY 2021-22 2nd Quarter - Budgetary Basis, Funds 25940, 25950, 25960, 26570, 26600 ($ Millions)
Appendix A
WATER ENTERPRISE OPERATING FUNDS
FY 2021-22 2nd Quarter - Budgetary Basis, Funds 25940, 25950, 25960, 26570, 26600 ($ Millions)
Revenue Variances
Other Notes
J. Calculated as ratio between (a) Total Sources plus Beginning Available Fund Balance plus Capacity Charges, less Operating Uses less Facilities Maintenance/Programmatic, excluding all revenues and expenses related to the 525 Golden Gate COPs, and (b) Debt Service. The Indenture requires this ratio to be a minimum of 1.25 times, and SFPUC's Debt Service Coverage Policy requires this ratio to to be a minimum of 1.35 times.
K. Calculated as ratio between (a) Total Sources plus any appropriated fund balance, plus Capacity Charges, less Operating Uses less Facilities Maintenance/Programmatic, excluding all revenues and expenses related to the 525 Golden Gate COPs, and (b) Debt Service. SFPUC's Debt Service Coverage Policy requires this ratio to be a minimum of
1.10 times.
A. Retail water sales forecasted to be 52.9 MGD, a 6.0% decrease from budgeted volumes of 56.2 MGD, and a 1.4% decrease from prior year actuals of 53.6 MGD. Assumes 5% drought surcharge effective April 2022. Projections incorporate COVID-19 emergency discount programs and $7.3M in grants from state COVID-19 utility debt forgiveness program.
B. Wholesale water sales forecasted to be 121.2 MGD, a 8.9% decrease from budgeted volumes of 133.0 MGD, and a 10.2% decrease from prior year actuals of 134.9 MGD. Revenues also include $2.1M in payments from customers not meeting minimum purchase requirements.
C. Interest income projected to fall below budget due to lower-than-budgeted interest rates on City's pooled funds portfolio.
D. Rental income projected to fall slightly below budget due to revenue adjustments made to Crystal Springs Golf Course.
Expenditure Variances
I. Calculated as Ending Available Fund Balance (including additions to General Reserve) as a percent of Operating Uses plus Facilities Maintenance/Programmatic Uses. SFPUC's Fund Balance Reserve Policy requires this to be within a range of 25-68%.
E. Savings due to vacant positions.
F. Savings reflect lower spending associated with bureau allocation.
G. Savings reflects lower spending from other City departments.
H. Savings reflects $810k in excess reserve funds applied to debt service payments.
FY 2020-21
Actuals
Original
Budget
Revised
Budget
(includes
carryforwards)
Projection
(current year
spending)
Variance
(Projection -
Revised Budget)
Sources
Sewer Service Charges 326.2 388.7 388.7 358.4 (30.4) A Interest Income 6.0 5.8 5.8 3.6 (2.2) B
Miscellaneous Income 5.0 4.3 4.5 6.3 1.8 C
Federal Bond Interest Subsidy 3.5 3.5 3.5 3.5 -
Appropriated/Budgeted Use of Fund Balance 28.6 9.6 14.6 14.6 - D Total Sources 369.4 411.9 417.1 386.3 (30.7)
Operating Uses
Personnel 70.8 82.1 82.1 79.5 2.7 E
Non-Personnel Services 18.1 26.3 28.9 27.4 1.5 F
City Grant Programs 0.1 0.3 0.6 0.6 -
Materials and Supplies 8.7 12.0 14.6 14.1 0.5 G
Equipment 0.9 3.2 6.6 6.6 -
Light, Heat, and Power 10.1 12.3 12.8 12.8 -
Overhead (SFPUC Bureaus) 29.5 36.4 43.6 42.5 1.1 H Services of Other Departments 27.0 25.4 27.1 27.1 - Debt Service 86.5 95.2 95.2 95.2 -
Total Operating Uses 251.7 293.1 311.5 305.8 5.8
Net Operating Results 117.7 80.6 $ (25.0)
Adjustments to Operating Fund Balance FY 2020-21
Actuals
Current
Year
Transfers
from
Operating
Total
Available
Funds
Projection
(current & future
years spending)
Project
Closeouts
Capital Projects 34.3 110.3 123.7 123.7 -
Facilities Maintenance/Programmatic 6.5 8.6 12.9 12.9 - Legal Settlements - - 4.9 4.9 - I
General Reserve - - - - -
Total Adjustments to Operating Fund Balance $ 40.9 $ 118.8 $ 141.5 $ 141.5 $ -
14.6 Available Fund Balance as of Fiscal Year-End $ 185.7 $ 146.1 Available Fund Balance, % of Operating Uses (J) 25-68% 108.1% 65.4% Debt Service Coverage (Year-End Budgetary Basis)
Indenture Basis (includes Available Fund Balance) (K) ≥ 1.35 4.39 4.18 3.66 Current Basis (L) ≥ 1.10 2.13 2.30 1.79
FY 2021-22
Appendix B
WASTEWATER ENTERPRISE OPERATING FUNDS
FY 2021-22 2nd Quarter - Budgetary Basis, Funds 20160, 20550, 20170, 20210 ($ Millions)
Appendix B
WASTEWATER ENTERPRISE OPERATING FUNDS
FY 2021-22 2nd Quarter - Budgetary Basis, Funds 20160, 20550, 20170, 20210 ($ Millions)
Revenue Variances
Expenditure Variances
Other Notes
J. Calculated as Ending Available Fund Balance (including additions to General Reserve) as a percent of Operating Uses plus Facilities Maintenance/Programmatic Uses. SFPUC's Fund Balance Reserve Policy requires this to be within a range of 25-68%.
K. Calculated as ratio between (a) Total Sources plus Beginning Available Fund Balance plus Capacity Charges, less Operating Uses less Facilities Maintenance/Programmatic (excluding all revenues and expenses related to the 525 Golden Gate COPs), and (b) Debt Service. The Indenture requires this ratio to be a minimum of 1.25 times, and SFPUC's Debt Service Coverage Policy requires this ratio to be a minimum of 1.35 times.
A. Wastewater retail billable volumes forecasted to be 42.9 MGD, a 3.7% decrease from budget of 44.5 MGD and a 0.3% decrease from prior year actuals of 43.0 MGD. Assumes 5% drought surcharge effective April 2022 and incorporates COVID-19 emergency discounts.
B. Interest income projected to fall below budget due to lower-than-budgeted interest rates on City's pooled funds portfolio.
E. Salary savings reflect vacant positions.
C. Miscellaneous income forecasted to increase from budget, primarily due to increased revenue from various permitting fees and non-utility services to other City departments.
I. $4.9M was appropriated to cover claims relating to the December 2014 rainstorms per Appropriation Ordinance No. 165-20 (section 10.10).
D. Additional fund balance of $4.9M was appropriated to cover claims relating to the December 2014 rainstorms per Appropriation Ordinance No. 165-20 (section 10.10).
F. Savings reflect lower spending on biosolids hauling and digester cleaning.
G.Savings reflect lower projected spending on chemical supplies.
H.Savings reflect salary savings associated with bureau allocation.
L. Calculated as ratio between (a) Total Sources plus any appropriated fund balance plus Capacity Charges, less Operating Uses less Facilities Maintenance/Programmatic (excluding all revenues and expenses related to the 525 Golden Gate COPs), and (b) Debt Service. SFPUC's Debt Service Coverage Policy requires this ratio to be a minimum of 1.10 times.
FY 2020-21
Actuals
Original
Budget
Revised
Budget
(includes
carryforwards)
Projection
(current year
spending)
Variance
(Projection -
Revised
Budget)
Sources
Electric Sales - Retail 109.1 134.7 134.7 138.6 3.9 A Electric Sales - Wholesale 15.1 17.5 17.5 20.6 3.0 B Water Sales - Transfer from Water Department 44.2 45.8 45.8 45.8 - Natural Gas & Steam - City Work Orders 13.0 12.9 18.6 14.8 (3.7) C Interest Income 1.5 4.8 4.8 2.3 (2.5) D Federal Interest Subsidy - Power Bonds 0.5 0.5 0.5 0.4 - Miscellaneous Income 9.8 5.6 5.6 9.0 3.5 E Appropriated/Budgeted Use of Fund Balance 29.3 7.1 45.4 45.4 - Total Sources 222.5 228.9 272.8 277.0 4.2 Operating Uses
Personnel 46.6 51.4 51.4 51.4 - Non-Personnel Services 60.3 39.4 52.6 51.8 0.8 F Power Purchases, Transmission Distribution & Related Charge 42.8 69.4 72.5 69.1 3.4 G Natural Gas & Steam 13.0 12.9 18.6 14.8 3.7 H Materials and Supplies 3.5 3.5 3.7 3.7 - Equipment 3.9 1.2 4.6 4.6 - Overhead (SFPUC Bureaus) 17.8 21.8 25.4 24.9 0.5 I Services of Other Departments 4.3 9.2 12.2 12.2 - Debt Service 3.7 3.9 3.9 3.9 - Total Operating Uses 195.9 212.7 244.8 236.4 8.4 Net Operating Results 26.6 40.7 12.6 Adjustments to Operating Fund Balance FY 2020-21
Actuals
Current
Year
Transfers
from
Operating
Total
Available
Funds
Projection
(current &
future years
spending)
Project
Closeouts
Facilities Maintenance/Programmatic 12.7 14.5 20.8 20.8 - Capital projects 27.0 1.7 96.6 96.6 - General Reserve - - - - - Total Adjustments to Operating Fund Balance 39.7 16.1 117.4 117.4 - Available Fund Balance as of Fiscal Year-End 80.6 86.1 Available Fund Balance, % of Operating Uses (J) 25-68% 39.3% 42.5% Debt Service Coverage… Year-End Budgetary Basis
Indenture Basis (includes Available Fund Balance) (K) ≥ 1.3 9.89 33.33 23.28 Appendix C
HETCH HETCHY WATER & POWER OPERATING FUNDS
FY 2021-22 2nd Quarter - Budgetary Basis - 24970, 24980, 24990 & 25030 ($ Millions)
FY 2021-22
Current Basis (L) ≥ 1.10 6.28 1.91 9.57 Revenue Variances
Expenditure Variances
D. Interest income projected to fall below budget due to lower-than-budgeted interest rates on City's pooled funds portfolio.
E. Miscellaneous revenues projected to increase from budget due to water sales to Lawrence Livermore National Labs resuming after being on hold for several years and removed from the budget.
A. Retail sales above budget due to unmetered loads moving to higher PG&E rates. Includes $1.2M in grants from state COVID-19 utility debt forgiveness program.
G. Increase to purchased power due to reduced generation compounded by large increases in power prices, $2.1M payments to PG&E for
unmentered loads starting February 2022 and $2.7M collateral call from APX due to increase in weekly billing amounts. These costs are
offset by $2.1M savings in local capacity costs, $1.5M in savings CAISO cost as well as $3M in prior year unspent funds carried F. Savings due to savings in service costs for loss of unmetered loads.
B. Wholesale sales above budget, mainly due to higher than budgeted power prices.
C. Savings due to lower usage in natural gas & steam.
H. Savings due to lower usage in natural gas & steam.
I. Savings reflect lower spending associated with bureau allocation.
FY 2020-21
Actuals Original Budget
Revised Budget
(includes
carryforwards &
supplemental)
Projection
(includes
carryforwards)
Variance
(Projection -Revised
Budget)
Operating Sources
Electric Sales - Green Product 199.8 213.3 248.4 246.9 (1.6) Electric Sales - SuperGreen Product 10.9 10.9 10.9 12.9 2.0 Wholesale Sales - - - - - Subtotal - Electric Revenues 210.7 224.1 259.3 259.7 0.4 Interest Income 0.6 0.9 0.9 0.2 (0.8) Appropriated/Budgeted Use of Fund Balance 10.5 2.9 6.4 6.4 - Total Sources 221.8 227.9 266.7 266.3 (0.4) Operating Uses
Personnel
3.7 8.0 8.0 6.2 1.8 Overhead 2.3 2.7 3.1 3.1 - Non Personnel Services 9.9 12.1 13.3 12.8 0.5 Materials & Supplies 0.0 0.2 0.2 0.1 0.1 Power Purchases 189.5 197.9 234.3 233.0 1.2 Services of Other Departments 3.7 3.7 3.7 3.7 - Debt Service 1.8 - - - Total Operating Uses 210.9 224.5 262.6 258.9 3.7 Net Operating Results 10.9 7.4 3.3 Adjustments to Operating Fund Balance FY 2020-21
Actuals
Current Year
Transfers from
Operating
Total Available
Funds
Projection
(current & future
years spending)
Project
Closeouts
Programmatic 0.1 1.0 1.6 1.6 - Capital Projects - 2.4 4.2 4.2 - General Reserve - - - - Total Adjustments to Operating Fund Balance 0.1 3.4 5.8 5.8 - Available Fund Balance as of Fiscal Year-End 73.4 73.9 Revenue Variances
Expenditure Variances
Other Notes
F. Revised budget reflects a $35.2M supplemental appropriation to cover higher than anticipated costs to purchase energy due to volatile power market. Wholesale power prices in California have increased by more than 30% since budget adoption.
Appendix D
CleanPowerSF
FY 2021-22 2nd Quarter - Budgetary Basis - 24750, 24761, 24765 & 24870 ($ Millions)
FY 2021-22
A. Revised budget reflects $35.2M supplemental appropriation to cover higher than anticipated costs to purchase energy due to volatile power market. Revenues are higher than budget due to approved rate increases in November and anticipated rate increases in March 2022. Projection also includes $2.4M in grants from state COVID-19 utility debt forgiveness program.
B. Interest income projected to fall below budget due to lower-than-budgeted interest rates on City's pooled funds portfolio.
C. Salary savings due to vacant positions.
G. Available fund balance at fiscal year end is calculated within this report by taking beginning fund balance, less any fund balance budgeted to be used as a source, and adding the projected variances as well as project closeouts. As the CleanPowerSF Trust Fund is a continuing fund, amounts budgeted therein will automatically roll forward to the following year and will not be closed out to fund balance. As such, variances related to revenues, purchase of power, and general reserves will not close out to fund balance at the end of the year without manual intervention. However, as those funds are not considered restricted and CleanPowerSF may choose to close them out to fund balance, we are presenting them here as part of fund balance.
D. Savings reflect budgeted contractual services performed internally.
E. Savings reflect a reduction in materials and supplies due to the current remote workforce.