SFPUC
FY 2024-25 1st Quarter Budget Report
Laura Busch
Deputy CFO
December 10, 2024
2 • Positive operating results projected for Power, CleanPowerSF and shortfalls for Water, Wastewater.
• Water : Retail volumes are down compared to budget which is the primary cause of the revenue shortfall. This is offset by lower labor, non-labor and debt service costs.
• Wastewater: Similar to water, revenues are projected to be below budget due to lower volumes. Also, certain stormwater only parcels currently have no service agreements and remain uncollected. This is offset by one-time receipts related to cost sharing for the Mariposa Pump Station project, lower labor costs and debt service costs.
• Power: Revenues are projected slightly below budget due to lower volumes in retail sales. This is offset by higher wholesale sales and large savings projected for power purchase costs from higher generation.
• CleanPowerSF: Retail sales are lower than budget due to final rates being set lower than budget, and lower demand. This is offset by slightly higher wholesale sales revenues and savings from power purchase costs.
• Year-end financial results projected to meet or exceed policy targets. Finance will be reviewing and updating SFPUC’s key financial policies during FY 2024-25.
FY 2024-25 Q1 Report Summary
3 • Net operating result: ($7.3M)
• Total sources down ($14.7M), and $7.4M in cost savings • Programmatic Savings & Legal Settlements $4.0M
• Net impact on fund balance: ($3.3M)
Sources
• ($12.4M) or -3.6% retail revenues
• ($1.8M) or -0.5% wholesale revenues
• ($0.5M) or -0.5% non-operating revenues
Uses
• $1.0M or -0.9% salaries and benefits
• $2.2M or -0.7% debt service
• $3.6M or -10.3% services of other departments
• $0.6M or -100% general reserve planned to go unspent
FY 2024-25 Water Budgetary Variances
4 • Net operating result: $(6.0M)
• Total sources down ($12.4M), and $6.4M in cost savings • Legal Settlements ($2.2M)
• Net impact on fund balance: ($8.2M)
Sources
• ($20.1M) or -4.6% sewer service charges
• $7.8M or 13.9% non-operating revenues
Uses
• $1.2M or -1.3% salaries and benefits
• $4.7M or -3.8% debt service
• $0.6M or -100% general reserve planned to go unspent
FY 2024-25 Wastewater Budgetary
Variances
5 • Net operating result: $56.6M
• Total sources down ($7.2M) and $63.8M in cost savings Sources
• ($10.2M) or -4.7% retail sales
• ($5.2M) or -18.2% gas & steam sales
• ($0.4M) or -3.9% non-operating revenues
• $8.6M or 51.5% wholesale sales
Uses
• $55.5M or -34.9% power and gas & steam costs
• $7.7M or 24.8% gas & steam
• $0.6M or -100% general reserve planned to go unspent
FY 2024-25 Power Budgetary
Variances
6 • Net operating result: $31.8M
• Total sources down ($28.7M) and $60.4M in cost savings Sources
• ($29.1M) or -6.3% power sales
• $0.4M or 13.5% interest income
Uses
• $19.9M or -4.7% purchase of power
• $40.5M or -100% general reserve planned to go unspent FY 2024-25 CleanPowerSF Budgetary
Variances
7 Key Financial Ratios
Fund Balance Reserve
Water Waste
Water
Hetchy Clean
Power
SF
• 25%-68% of Annual
Operating Uses
49.2% 55.7% 89.2% 40.8%*
Debt Service Coverage
Reserve
• Indenture Basis ≥ 1.35x 1.74 3.04 19.27
• Current Basis ≥ 1.10x 1.20 1.91 8.81
* CleanPowerSF’s SFPUC's Fund Balance Reserve Policy requires it to build its fund balance reserve to a minimum of 41% (150 days) and a target of 49% (180 days) of operating expenditures within three fiscal years (June 30, 2025) of Fiscal Year Ending 2022.
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