Item 6
VALLEY CLEAN ENERGY ALLIANCE
Staff Report – Item 6A
______________________________________________________________________________ TO: Board of Directors
FROM: Mitch Sears, Executive Director
Edward Burnham, Finance and Operations Director
SUBJECT: Financial Update – June 30, 2023 (unaudited) financial statements (with comparative year to date information) and Actual vs. Budget year to date ending June 30, 2023
DATE: October 12, 2023
RECOMMENDATION:
Accept the following Financial Statements (unaudited) for the period of June 1, 2023 to June 30, 2023 (with comparative year to date information) and Actual vs. Budget year to date ending June 30, 2023.
BACKGROUND & DISCUSSION:
The attached financial statements are prepared in a form to satisfy the debt covenants with River City Bank pursuant to the Line of Credit and are required to be prepared monthly.
The Financial Statements include the following reports:
• Statement of Net Position
• Statement of Revenues, Expenditures and Changes in Net Position • Statement of Cash Flows
In addition, Staff is reporting the Actual vs. Budget variances year to date ending June 30, 2023.
Financial Statements for the period June 1, 2023 – June 30, 2023 In the Statement of Net Position, VCE, as of June 30, 2023, has a total of $5,545,433 in its checking, money market and lockbox accounts, $1,100,000 restricted assets for the Debt Service Reserve account, $1,800,000 restricted assets related to supplier deposits, and $3,436,559 restricted assets for the Power Purchases Reserve account. VCE has incurred obligations from Member agencies and owes as of June 30, 2023 a total of $8,035. VCE member obligations are incurred monthly due to staffing, accounting, and legal services.
Item 6
The term loan with River City Bank includes a current portion of $267,858 and a long-term portion of 181,284. On June 30, 2022, VCE’s net position was $16,737,515.
In the Statement of Revenues, Expenditures, and Changes in Net Position, VCE recorded $ 10,754,193 of revenue (net of allowance for doubtful accounts), of which $8,777,362 was billed in June, and $7,339,006 represent estimated unbilled revenue. The cost of electricity for the June revenue totaled $5,171,794.
For June, VCE’s gross margin was approximately 52% and the net income totaled $5,151,217. The year-to-date change in net position was 1,326,981.
In the Statement of Cash Flows, VCE cash flows from operations were $818,609 due to June cash receipts of revenues being more than the monthly cash operating expenses.
Actual vs. Budget Variances for the year to date ending June 30, 2023 Below are the financial statement line items with variances >$50,000 and 5% • Electric Revenue – ($6,124,115) and -13% – Unfavorable variance due to revenue model (January-2023) and retail load variance lower than forecasted due to mild winter and spring. • Purchased Power – $1,895,194 and -6% – Favorable variance due to gas prices driving short-term power market increases during winter off-set by lower load than forecasted. • Wholesale Energy Services – ($310,987) and 58% unfavorable variance related to the transition of services to TEA starting in Q123 budgeted for Q223.
• Credit Support Services (SMUD) – $105,505 and 41% favorable variance related to lower retail load than forecasted due to mild winter and summer.
• Operational Support Services (SMUD) – ($92,257) and 290% unfavorable variance related to Percentage of Income Payment Plan (PIPP) program implementation, bill presentment, and base green rate implementation. • Legal General Counsel – $72,838 and 89% favorable variance related to lower operational support requirements than budgeted.
• Strategic Plan Implementation – $72,270 or 100% favorable variance due to timing difference. • Contingency – ($120,00) and (100%) – favorable variance to budget is due to not having a need yet to utilize the contingency funds set aside in the budget.
Attachments:
1) Financial Statements (Unaudited) June 1, 2023 to June 30, 2023 (with comparative year to date information.)
2) Actual vs. Budget for the year to date ending June 30, 2023
VALLEY CLEAN ENERGY ALLIANCE
FINANCIAL STATEMENTS
(UNAUDITED)
FOR THE PERIOD OF JUNE 1 TO JUNE 30, 2023
PREPARED ON SEPTEMBER 28, 2023
2 ASSETS
Current assets:
Cash in Yolo County Treasury
Cash and cash equivalents $ 5,545,433
Accounts receivable, net of allowance 11,619,815
Accrued revenue 3,020,149
Prepaid expenses 17,363
Other current assets and deposits 2,227,703
Total current assets 22,430,463
Restricted assets:
Debt service reserve fund 1,100,000
Power purchase reserve fund 3,436,559
Total restricted assets 4,536,559
TOTAL ASSETS $ 26,967,022
LIABILITIES
Current liabilities:
Accounts payable $ 441,698
Accrued payroll 96,649
Interest payable 1,336
Due to member agencies 8,035
Accrued cost of electricity 6,322,760
Other accrued liabilities 1,071,558
Security deposits - energy supplies 1,800,000
User taxes and energy surcharges 38,329
Limited Term Loan 267,858
Total current liabilities 10,048,223
Noncurrent liabilities
Term Loan- RCB 181,284
Total noncurrent liabilities 181,284
TOTAL LIABILITIES $ 10,229,507
NET POSITION
Net position:
Local Programs Reserve 224,500
Restricted 4,536,559
Unrestricted 11,976,456
TOTAL NET POSITION $ 16,737,515
(UNAUDITED)
VALLEY CLEAN ENERGY ALLIANCE
STATEMENT OF NET POSITION
June 30, 2023
3 FOR THE PERIOD
ENDING
JUNE 30, 2023 YEAR TO DATE
OPERATING REVENUE
Electricity sales, net $ 10,754,193 $ 38,475,028
Other revenue 3,375 631,219
TOTAL OPERATING REVENUES 10,757,568 $ 39,106,247
OPERATING EXPENSES
Cost of electricity 5,171,794 $ 34,110,194
Contract services 199,725 1,837,426
Staff compensation 113,718 737,096
General, administration, and other 141,422 1,187,259
TOTAL OPERATING EXPENSES 5,626,658 $ 37,871,975
TOTAL OPERATING INCOME (LOSS) 5,130,909 $ 1,234,272
NONOPERATING REVENUES (EXPENSES)
Interest income 21,644 102,681
Interest and related expenses (1,336) (9,971)
TOTAL NONOPERATING REVENUES
(EXPENSES) 20,308 92,710
CHANGE IN NET POSITION 5,151,217 1,326,981
Net position at beginning of period 11,586,298 15,410,534 Net position at end of period $ 16,737,515 $ 16,737,515 (UNAUDITED)
CHANGES IN NET POSITION
FOR THE PERIOD OF JUNE 1, 2023 TO JUNE 30, 2023
(WITH COMPARATIVE YEAR TO DATE INFORMATION)
VALLEY CLEAN ENERGY ALLIANCE
STATEMENT OF REVENUES, EXPENDITURES AND
4 FOR THE
PERIOD ENDING
JUNE 30, 2023 YEAR TO DATE
CASH FLOWS FROM OPERATING ACTIVITIES
Receipts from electricity sales $ 6,075,308 $ 37,484,605 Payments received from other revenue sources 3,375 631,219 Payments to purchase electricity (5,174,461) (32,396,459) Payments for contract services, general, and adminstration (410,130) (3,137,395) Payments for staff compensation (103,186) (756,732)
Net cash provided (used) by operating activities 818,609 (1,774,762)
CASH FLOWS FROM NON-CAPITAL FINANCING ACTIVITIES
Principal payments of Debt (44,149) (81,826)
Interest and related expenses (1,516) (10,883)
Net cash provided (used) by non-capital financing
activities (45,665) (92,709)
CASH FLOWS FROM CAPITAL AND RELATED FINANCING ACTIVITIES Acquisition of nondepreciable assets
Acquisition of capital assets
Net cash provided (used) by capital and related financing activities
CASH FLOWS FROM INVESTING ACTIVITIES
Interest income 21,644 102,681
Net cash provided (used) by investing activities 21,644 102,681 NET CHANGE IN CASH AND CASH EQUIVALENTS 794,588 2,422,109 Cash and cash equivalents at beginning of period 9,287,404 49,947,420 Cash and cash equivalents at end of period $ 10,081,992 $ 52,369,529 Cash and cash equivalents included in:
Cash and cash equivalents 5,545,433 5,545,433
Restricted assets 4,536,559 4,536,559
Cash and cash equivalents at end of period $ 10,081,992 $ 10,081,992
VALLEY CLEAN ENERGY ALLIANCE
STATEMENTS OF CASH FLOWS
FOR THE PERIOD OF JUNE 1 TO JUNE 30, 2023
(WITH YEAR TO DATE INFORMATION)
(UNAUDITED)
5 FOR THE
PERIOD ENDING
JUNE 30, 2023 YEAR TO DATE
Operating Income (Loss) $ 813,899 $ 1,234,271
(Increase) decrease in net accounts receivable (2,438,083.00) (1,390,134) (Increase) decrease in accrued revenue 2,056,064 410,248 (Increase) decrease in prepaid expenses 15,342 (17,363) Increase (decrease) in accounts payable (62,630) 42,169 Increase (decrease) in accrued payroll (5,889) (19,636) Increase (decrease) in due to member agencies 650 (198,409) Increase (decrease) in accrued cost of electricity (2,667) 1,713,735 Increase (decrease) in other accrued liabilities (7,772) 60,894 Increase (decrease) in user taxes and energy surcharges 21,992 (10,537) Net cash provided (used) by operating activities $ 818,609 $ 2,412,137
RECONCILIATION OF OPERATING INCOME TO NET
CASH PROVIDED (USED) BY OPERATING ACTIVITIES
(WITH YEAR TO DATE INFORMATION)
(UNAUDITED)
FOR THE PERIOD OF JUNE 1 TO JUNE 30, 2023
VALLEY CLEAN ENERGY ALLIANCE
STATEMENTS OF CASH FLOWS
VALLEY CLEAN ENERGY
2023 YTD ACTUAL VS. BUDGET
FOR THE YEAR TO DATE ENDING 06/30/23
Description YTD
Actuals
YTD
Budget
YTD
Variance
%
over/-under
Electric Revenue $ 42,793,885 $ 48,918,000 $ (6,124,115) -13% Other Revenues - Programs $ 631,219 $ 330,000 $ 301,219 91% Interest Revenues $ 102,681 $ 21,000 $ 81,681 389%
Purchased Power $ 34,110,194 $ 32,215,000 $ 1,895,194 6% Purchased Power Base $ 34,110,194 $ 30,680,000 $ 3,430,194 11% Purchased Power Contingency 2% $ - $ 1,535,000 $ (1,535,000) -100% Labor & Benefits $ 738,812 $ 721,200 $ 17,612 2%
Salaries & Wages/Benefits $ 585,826 $ 600,000 $ (14,174) -2% Contract Labor (SMUD Staff Aug) $ - $ 15,000 $ (15,000) -100% Human Resources & Payroll $ 152,986 $ 106,200 $ 46,786 44% Office Supplies & Other Expenses $ 147,171 $ 108,000 $ 39,171 36% Technology Costs $ 17,614 $ 23,400 $ (5,786) -25%
Office Supplies $ 6,840 $ 1,200 $ 5,640 470%
Travel $ 15,621 $ 3,000 $ 12,621 421%
CalCCA Dues $ 64,512 $ 66,600 $ (2,088) -3%
CC Power $ 41,029 $ 12,600 $ 28,429 226%
Memberships $ 1,555 $ 1,200 $ 355 30%
Contractual Services $ 1,728,664 $ 1,559,000 $ 169,664 11% Other Contract Services $ - $ 13,200 $ (13,200) -100%
Don Dame $ 1,897 $ 5,400 $ (3,503) -65%
SMUD - Credit Support $ 148,895 $ 254,400 $ (105,505) -41% SMUD - Wholesale Energy Services $ 849,887 $ 538,900 $ 310,987 58% SMUD - Call Center $ 421,839 $ 415,300 $ 6,539 2%
SMUD - Operating Services $ 124,057 $ 31,800 $ 92,257 290% Commercial Legal Support $ 20,156 $ 15,000 $ 5,156 34%
Legal General Counsel $ 8,762 $ 81,600 $ (72,838) -89%
Regulatory Counsel $ 68,096 $ 105,000 $ (36,905) -35%
Joint CCA Regulatory counsel $ 7,525 $ 16,800 $ (9,275) -55% Legislative - (Lobbyist) $ 33,000 $ 33,000 $ - 0%
Accounting Services $ 8,590 $ 14,400 $ (5,810) -40%
Financial Consultant $ - $ 21,000 $ (21,000) -100%
Audit Fees $ 35,960 $ 13,200 $ 22,760 172%
Marketing $ 168,533 $ 132,000 $ 36,533 28%
Marketing Collateral $ 145,343 $ 126,000 $ 19,343 15%
Community Engagement Activities & Sponsorships $ 6,000 23,190 $ 17,190 $ 287% Program Costs $ 741,482 $ 417,000 $ 324,482 78%
Program Costs $ 2,459 $ 87,000 $ (84,541) -97%
Programs - EV $ 112,623 $ - $ 112,623 100%
Programs - AgFIT $ 617,428 $ 330,000 $ 287,428 87%
Programs - Heat Pump $ 8,972 $ - $ 8,972 100%
Rents & Leases $ 6,588 $ 13,200 $ (6,612) -50%
Hunt Boyer Mansion $ 6,588 $ 13,200 $ (6,612) -50%
Other A&G $ 231,679 $ 300,800 $ (69,121) -23%
Development - New Members $ - $ 12,600 $ (12,600) -100% Strategic Plan Implementation $ (270) $ 72,000 $ (72,270) -100% PG&E Data Fees $ 131,441 $ 138,000 $ (6,559) -5%
Insurance $ 17,640 $ 5,700 $ 11,940 209%
Banking Fees $ 82,868 $ 72,500 $ 10,368 14%
Miscellaneous Operating Expenses $ 256 $ 3,600 $ (3,344) -93% Contingency $ - $ 120,000 $ (120,000) -100%
TOTAL OPERATING EXPENSES 37,873,378 $ 35,589,800 $ (2,283,578) $ -6% Interest on RCB loan $ 9,971 $ 10,900 $ (929) -9%
Interest Expense - Bridge Loan $ - $ 25,000 $ (25,000) -100% NET INCOME 5,644,435 $ 13,643,300 $ (7,998,865) $ -59%
Item 6
VALLEY CLEAN ENERGY ALLIANCE
Staff Report – Item 6B
______________________________________________________________________________ TO: Board of Directors
FROM: Mitch Sears, Executive Director
Edward Burnham, Finance and Operations Director
SUBJECT: Financial Update – July 31, 2023 (unaudited) financial statements (with comparative year to date information) and Actual vs. Budget year to date ending July 31, 2023
DATE: October 12, 2023
RECOMMENDATION:
Accept the following Financial Statements (unaudited) for the period of July 1, 2023 to July 31, 2023 (with comparative year to date information) and Actual vs. Budget year to date ending July 31, 2023.
BACKGROUND & DISCUSSION:
The attached financial statements are prepared in a form to satisfy the debt covenants with River City Bank pursuant to the Line of Credit and are required to be prepared monthly.
The Financial Statements include the following reports:
• Statement of Net Position
• Statement of Revenues, Expenditures and Changes in Net Position • Statement of Cash Flows
In addition, Staff is reporting the Actual vs. Budget variances year to date ending July 31, 2023.
Financial Statements for the period July 1, 2023 – July 31, 2023 In the Statement of Net Position, VCE, as of July 31, 2023, has a total of $6,268,493 in its checking, money market and lockbox accounts, $1,100,000 restricted assets for the Debt Service Reserve account, $1,800,000 restricted assets related to supplier deposits, and $3,455,552 restricted assets for the Power Purchases Reserve account. VCE has incurred obligations from Member agencies and owes as of July 31, 2023 a total of $6,734. VCE member obligations are incurred monthly due to staffing, accounting, and legal services.
Item 6
The term loan with River City Bank includes a current portion of $223,529 and a long-term portion of 181,284. On July 31, 2022, VCE’s net position was $22,140,585.
In the Statement of Revenues, Expenditures, and Changes in Net Position, VCE recorded $ 10,636,848 of revenue (net of allowance for doubtful accounts), of which $10,889,433 was billed in July, and $7,333,912 represent estimated unbilled revenue. The cost of electricity for the July revenue totaled $4,902,253. For July, VCE’s gross margin was approximately 52% and the net income totaled $5,403,070.
The year-to-date change in net position was 6,730,051.
In the Statement of Cash Flows, VCE cash flows from operations were $753,983 due to July cash receipts of revenues being more than the monthly cash operating expenses.
Actual vs. Budget Variances for the year to date ending July 31, 2023 Below are the financial statement line items with variances >$50,000 and 5% • Electric Revenue – ($8,157,267) and -13% – Unfavorable variance due to revenue model (January-2023) and retail load variance lower than forecasted due to mild winter and spring. • Purchased Power – $1,694,553 and -6% – Favorable variance due to gas prices driving short-term power market increases during winter off-set by lower load than forecasted. • Wholesale Energy Services – ($320,150) and 53% unfavorable variance related to the transition of services to TEA starting in Q123 budgeted for Q223.
• Credit Support Services (SMUD) – $99,137 and 39% favorable variance related to lower retail load than forecasted due to mild winter and summer.
• Operational Support Services (SMUD) – ($93,329) and 252% unfavorable variance related to Percentage of Income Payment Plan (PIPP) program implementation, bill presentment, and base green rate implementation. • Legal General Counsel – $85,718 and 90% favorable variance related to lower operational support requirements than budgeted.
• Strategic Plan Implementation – $84,016 or 100% favorable variance due to timing difference. • Contingency – ($140,00) and (100%) – favorable variance to budget is due to not having a need yet to utilize the contingency funds set aside in the budget.
Attachments:
3) Financial Statements (Unaudited) July 1, 2023 to July 31, 2023 (with comparative year to date information.)
4) Actual vs. Budget for the year to date ending July 31, 2023
VALLEY CLEAN ENERGY ALLIANCE
FINANCIAL STATEMENTS
(UNAUDITED)
FOR THE PERIOD OF JULY 1 TO JULY 31, 2023
PREPARED ON SEPTEMBER 28, 2023
2 ASSETS
Current assets:
Cash in Yolo County Treasury
Cash and cash equivalents $ 6,268,493
Accounts receivable, net of allowance 14,028,376
Accrued revenue 3,015,055
Prepaid expenses 123,619
Other current assets and deposits 2,227,703
Total current assets 25,663,246
Restricted assets:
Debt service reserve fund 1,100,000
Power purchase reserve fund 3,445,552
Total restricted assets 4,545,552
TOTAL ASSETS $ 30,208,798
LIABILITIES
Current liabilities:
Accounts payable $ 336,813
Accrued payroll 85,860
Interest payable 1,244
Due to member agencies 6,734
Accrued cost of electricity 4,257,605
Other accrued liabilities 1,118,158
Security deposits - energy supplies 1,800,000
User taxes and energy surcharges 56,986
Limited Term Loan 223,529
Total current liabilities 7,886,929
Noncurrent liabilities
Term Loan- RCB 181,284
Total noncurrent liabilities 181,284
TOTAL LIABILITIES $ 8,068,213
NET POSITION
Net position:
Local Programs Reserve 224,500
Restricted 4,545,552
Unrestricted 17,370,533
TOTAL NET POSITION $ 22,140,585
(UNAUDITED)
VALLEY CLEAN ENERGY ALLIANCE
STATEMENT OF NET POSITION
July 31, 2023
3 FOR THE PERIOD
ENDING
JULY 31, 2023 YEAR TO DATE
OPERATING REVENUE
Electricity sales, net $ 10,636,848 $ 49,111,876
Other revenue - 631,219
TOTAL OPERATING REVENUES 10,636,848 $ 49,743,095
OPERATING EXPENSES
Cost of electricity 4,902,253 $ 39,012,447
Contract services 190,874 2,028,301
Staff compensation 100,455 837,552
General, administration, and other 62,686 1,249,940
TOTAL OPERATING EXPENSES 5,256,268 $ 43,128,240
TOTAL OPERATING INCOME (LOSS) 5,380,580 $ 6,614,855
NONOPERATING REVENUES (EXPENSES)
Interest income 23,734 126,414
Interest and related expenses (1,244) (11,215)
TOTAL NONOPERATING REVENUES
(EXPENSES) 22,490 115,199
CHANGE IN NET POSITION 5,403,070 6,730,051
Net position at beginning of period 16,737,515 15,410,534 Net position at end of period $ 22,140,585 $ 22,140,585 (WITH COMPARATIVE YEAR TO DATE INFORMATION)
VALLEY CLEAN ENERGY ALLIANCE
STATEMENT OF REVENUES, EXPENDITURES AND
(UNAUDITED)
CHANGES IN NET POSITION
FOR THE PERIOD OF JULY 1, 2023 TO JULY 31, 2023
4 FOR THE
PERIOD ENDING
JULY 31, 2023 YEAR TO DATE
CASH FLOWS FROM OPERATING ACTIVITIES
Receipts from electricity sales 8,252,038 46,592,049
Payments received from other revenue sources - 631,219
Payments to purchase electricity (6,967,408) (39,363,867) Payments for contract services, general, and adminstration (419,403) (3,556,799) Payments for staff compensation (111,244) (867,976)
Other cash payments - (268,507)
Net cash provided (used) by operating activities 753,983 3,434,626
CASH FLOWS FROM NON-CAPITAL FINANCING ACTIVITIES
Principal payments of Debt (44,329) (81,826)
Interest and related expenses (1,334) (10,881)
Net cash provided (used) by non-capital financing
activities (45,663) (92,707)
CASH FLOWS FROM CAPITAL AND RELATED FINANCING ACTIVITIES Acquisition of nondepreciable assets
Acquisition of capital assets
Net cash provided (used) by capital and related financing activities
CASH FLOWS FROM INVESTING ACTIVITIES
Interest income 23,734 126,414
Net cash provided (used) by investing activities 23,734 126,414 NET CHANGE IN CASH AND CASH EQUIVALENTS 732,053 3,154,162 Cash and cash equivalents at beginning of period 10,081,992 60,029,412 Cash and cash equivalents at end of period 10,814,045 63,183,574 Cash and cash equivalents included in:
Cash and cash equivalents 6,268,493 6,268,493
Restricted assets 4,545,552 4,545,552
Cash and cash equivalents at end of period 10,814,045 10,814,045 (WITH YEAR TO DATE INFORMATION)
(UNAUDITED)
VALLEY CLEAN ENERGY ALLIANCE
STATEMENTS OF CASH FLOWS
FOR THE PERIOD OF JULY 1 TO JULY 31, 2023
5 FOR THE
PERIOD ENDING
JULY 31, 2023 YEAR TO DATE
Operating Income (Loss) 5,380,580 6,614,851
Depreciation expense
(Increase) decrease in net accounts receivable (2,408,561) (2,943,289) (Increase) decrease in accrued revenue 5,094 415,342
(Increase) decrease in prepaid expenses (106,256) (123,619) (Increase) decrease in other assets and deposits - (268,507) Increase (decrease) in accounts payable (104,886) (62,718) Increase (decrease) in accrued payroll (10,789) (30,425) Increase (decrease) in due to member agencies (1,301) (199,710) Increase (decrease) in accrued cost of electricity (2,065,155) (351,420) Increase (decrease) in other accrued liabilities 46,600 107,494 Increase (decrease) in user taxes and energy surcharges 18,657 8,120 Net cash provided (used) by operating activities 753,983 3,166,119 FOR THE PERIOD OF JULY 1 TO JULY 31, 2023
VALLEY CLEAN ENERGY ALLIANCE
STATEMENTS OF CASH FLOWS
Adjustments to reconcile operating income to net cash provided (used) by operating activities:
RECONCILIATION OF OPERATING INCOME TO NET
CASH PROVIDED (USED) BY OPERATING ACTIVITIES
(WITH YEAR TO DATE INFORMATION)
(UNAUDITED)
VALLEY CLEAN ENERGY
2023 YTD ACTUAL VS. BUDGET
FOR THE YEAR TO DATE ENDING 07/31/23
Description YTD
Actuals
YTD
Budget
YTD
Variance
%
over/-under
Electric Revenue $ 53,430,733 $ 61,588,000 $ (8,157,267) -13% Other Revenues - Programs $ 631,219 $ 385,000 $ 246,219 64% Interest Revenues $ 126,414 $ 24,500 $ 101,914 416%
Purchased Power $ 39,012,447 $ 40,707,000 $ (1,694,553) -4% Purchased Power Base $ 39,012,447 $ 38,768,000 $ 244,447 1% Purchased Power Contingency 2% $ - $ 1,939,000 $ (1,939,000) -100% Labor & Benefits $ 839,267 $ 841,400 $ (2,133) 0%
Salaries & Wages/Benefits $ 676,448 $ 700,000 $ (23,552) -3% Contract Labor (SMUD Staff Aug) $ - $ 17,500 $ (17,500) -100% Human Resources & Payroll $ 162,819 $ 123,900 $ 38,919 31% Office Supplies & Other Expenses $ 164,720 $ 125,200 $ 39,520 32% Technology Costs $ 24,146 $ 26,500 $ (2,354) -9%
Office Supplies $ 7,105 $ 1,400 $ 5,705 408%
Travel $ 15,621 $ 3,500 $ 12,121 346%
CalCCA Dues $ 75,264 $ 77,700 $ (2,436) -3%
CC Power $ 41,029 $ 14,700 $ 26,329 179%
Memberships $ 1,555 $ 1,400 $ 155 11%
Contractual Services $ 1,919,705 $ 1,771,000 $ 148,705 8% Other Contract Services $ - $ 15,400 $ (15,400) -100%
Don Dame $ 2,185 $ 6,300 $ (4,116) -65%
SMUD - Credit Support $ 155,263 $ 254,400 $ (99,137) -39% SMUD - Wholesale Energy Services $ 929,050 $ 608,900 $ 320,150 53% SMUD - Call Center $ 495,075 $ 485,700 $ 9,375 2%
SMUD - Operating Services $ 130,829 $ 37,200 $ 93,629 252% Commercial Legal Support $ 21,068 $ 17,500 $ 3,568 20%
Legal General Counsel $ 9,482 $ 95,200 $ (85,718) -90%
Regulatory Counsel $ 84,394 $ 122,500 $ (38,107) -31%
Joint CCA Regulatory counsel $ 7,611 $ 19,600 $ (11,989) -61% Legislative - (Lobbyist) $ 38,500 $ 38,500 $ - 0%
Accounting Services $ 7,289 $ 16,800 $ (9,511) -57%
Financial Consultant $ - $ 24,500 $ (24,500) -100%
Audit Fees $ 38,960 $ 28,500 $ 10,460 37%
Marketing $ 156,078 $ 154,000 $ 2,078 1%
Marketing Collateral $ 144,884 $ 147,000 $ (2,116) -1%
Community Engagement Activities & Sponsorships $ 7,000 11,194 $ 4,194 $ 60% Program Costs $ 770,531 $ 486,500 $ 284,031 58%
Program Costs $ 375 $ 101,500 $ (101,125) -100%
Programs - EV $ 115,980 $ - $ 115,980 100%
Programs - AgFIT $ 642,878 $ 385,000 $ 257,878 67%
Programs - Heat Pump $ 11,297 $ - $ 11,297 100%
Rents & Leases $ 8,238 $ 15,400 $ (7,162) -47%
Hunt Boyer Mansion $ 8,238 $ 15,400 $ (7,162) -47%
Other A&G $ 256,992 $ 338,950 $ (81,958) -24%
Development - New Members $ - $ 14,700 $ (14,700) -100% Strategic Plan Implementation $ (16) $ 84,000 $ (84,016) -100% PG&E Data Fees $ 153,559 $ 161,000 $ (7,441) -5%
Insurance $ 20,580 $ 6,650 $ 13,930 209%
Banking Fees $ 82,868 $ 72,600 $ 10,268 14%
Miscellaneous Operating Expenses $ 1,669 $ 4,200 $ (2,531) -60% Contingency $ - $ 140,000 $ (140,000) -100%
TOTAL OPERATING EXPENSES 43,129,646 $ 44,583,650 $ (1,454,004) $ -3% Interest on RCB loan $ 11,215 $ 12,300 $ (1,085) -9%
Interest Expense - Bridge Loan $ - $ 35,000 $ (35,000) -100% NET INCOME 10,416,286 $ 16,981,550 $ (6,565,264) $ -39% Item 6
VALLEY CLEAN ENERGY ALLIANCE
Staff Report – Item 6C
______________________________________________________________________________ TO: Board of Directors
FROM: Mitch Sears, Executive Director
Edward Burnham, Finance and Operations Director
SUBJECT: Financial Update – August 31, 2023 (unaudited) financial statements (with comparative year to date information) and Actual vs. Budget year to date ending August 31, 2023
DATE: October 12, 2023
RECOMMENDATION:
Accept the following Financial Statements (unaudited) for the period of August 1, 2023 to August 31, 2023 (with comparative year to date information) and Actual vs. Budget year to date ending August 31, 2023.
BACKGROUND & DISCUSSION:
The attached financial statements are prepared in a form to satisfy the debt covenants with River City Bank pursuant to the Line of Credit and are required to be prepared monthly.
The Financial Statements include the following reports:
• Statement of Net Position
• Statement of Revenues, Expenditures and Changes in Net Position • Statement of Cash Flows
In addition, Staff is reporting the Actual vs. Budget variances year to date ending August 31, 2023.
Financial Statements for the period August 1, 2023 – August 31, 2023 In the Statement of Net Position, VCE, as of August 31, 2023, has a total of $12,269,507 in its checking, money market and lockbox accounts, $1,100,000 restricted assets for the Debt Service Reserve account, $1,800,000 restricted assets related to supplier deposits, and $3,455,039 restricted assets for the Power Purchases Reserve account. VCE has incurred obligations from Member agencies and owes as of August 31, 2023 a total of $9,337. VCE member obligations are incurred monthly due to staffing, accounting, and legal services.
Item 6
The term loan with River City Bank includes a current portion of $179,108 and a long-term portion of 181,284. On August 31, 2022, VCE’s net position was $27,323,978.
In the Statement of Revenues, Expenditures, and Changes in Net Position, VCE recorded $ 11,881,091 of revenue (net of allowance for doubtful accounts), of which $13,729,589 was billed in August, and $6,562,671 represent estimated unbilled revenue. The cost of electricity for the August revenue totaled $6,204,703. For August, VCE’s gross margin was approximately 48% and the net income totaled $5,257,764. The year-to-date change in net position was 11,913,444.
In the Statement of Cash Flows, VCE cash flows from operations were $6,102,262 due to August cash receipts of revenues being more than the monthly cash operating expenses.
Actual vs. Budget Variances for the year to date ending August 31, 2023 Below are the financial statement line items with variances >$50,000 and 5% • Electric Revenue – ($8,506,176) and -12% – Unfavorable variance due to revenue model (January-2023) and retail load variance lower than forecasted due to mild winter and spring. • Purchased Power – $3,996,850 and -8% – Favorable variance due to gas prices driving short-term power market increases during winter off-set by lower load than forecasted. • Wholesale Energy Services – ($322,470) and 47% unfavorable variance related to the transition of services to TEA starting in Q123 budgeted for Q223.
• Credit Support Services (SMUD) – $100,011 and 39% favorable variance related to lower retail load than forecasted due to mild winter and summer.
• Operational Support Services (SMUD) – ($91,139) and 214% unfavorable variance related to Percentage of Income Payment Plan (PIPP) program implementation, bill presentment, and base green rate implementation. • Legal General Counsel – $95,870 and 88% favorable variance related to lower operational support requirements than budgeted.
• Strategic Plan Implementation – $83,610 or 87% favorable variance due to timing difference. • Contingency – ($160,00) and (100%) – favorable variance to budget is due to not having a need yet to utilize the contingency funds set aside in the budget.
Attachments:
5) Financial Statements (Unaudited) August 1, 2023 to August 31, 2023 (with comparative year to date information.)
6) Actual vs. Budget for the year to date ending August 31, 2023
VALLEY CLEAN ENERGY ALLIANCE
FINANCIAL STATEMENTS
(UNAUDITED)
FOR THE PERIOD OF AUGUST 1 TO AUGUST 31, 2023
PREPARED ON SEPTEMBER 29, 2023
2 ASSETS
Current assets:
Cash in Yolo County Treasury
Cash and cash equivalents $ 12,269,507
Accounts receivable, net of allowance 15,050,032
Accrued revenue 2,243,815
Prepaid expenses 108,277
Other current assets and deposits 2,227,703
Total current assets 31,899,334
Restricted assets:
Debt service reserve fund 1,100,000
Power purchase reserve fund 3,455,039
Total restricted assets 4,555,039
TOTAL ASSETS $ 36,454,373
LIABILITIES
Current liabilities:
Accounts payable $ 350,399
Accrued payroll 55,123
Interest payable 1,108
Due to member agencies 9,337
Accrued cost of electricity 4,355,249
Other accrued liabilities 2,162,037
Security deposits - energy supplies 1,800,000
User taxes and energy surcharges 36,750
Limited Term Loan 179,108
Total current liabilities 8,949,111
Noncurrent liabilities
Term Loan- RCB 181,284
Total noncurrent liabilities 181,284
TOTAL LIABILITIES $ 9,130,395
NET POSITION
Net position:
Local Programs Reserve $ 224,500
Restricted 4,555,039
Unrestricted 22,544,439
TOTAL NET POSITION $ 27,323,978
(UNAUDITED)
VALLEY CLEAN ENERGY ALLIANCE
STATEMENT OF NET POSITION
AUGUST 31, 2023
3 FOR THE PERIOD
ENDING
AUGUST 31, 2023 YEAR TO DATE
OPERATING REVENUE
Electricity sales, net $ 11,881,091 $ 49,111,876
Other revenue - 631,219
TOTAL OPERATING REVENUES 11,881,091.00 49,743,094.69
OPERATING EXPENSES
Cost of electricity $ 6,204,703 $ 39,088,233
Contract services 229,308 2,028,008
Staff compensation 105,580 837,552
General, administration, and other 110,901 1,248,818
TOTAL OPERATING EXPENSES 6,650,492.30 43,202,610.86
TOTAL OPERATING INCOME (LOSS) $ 5,230,599 $ 6,540,484
NONOPERATING REVENUES (EXPENSES)
Interest income 28,273 126,414
Interest and related expenses (1,108) (11,215)
TOTAL NONOPERATING REVENUES
(EXPENSES) 27,165 115,199
CHANGE IN NET POSITION 5,257,764 11,913,444
Net position at beginning of period 22,066,214 15,410,534 Net position at end of period $ 27,323,978 $ 27,323,978 (UNAUDITED)
FOR THE PERIOD OF AUGUST 1, 2023 TO AUGUST 31, 2023
(WITH COMPARATIVE YEAR TO DATE INFORMATION)
4 FOR THE
PERIOD ENDING
AUGUST 31, 2023 YEAR TO DATE
CASH FLOWS FROM OPERATING ACTIVITIES
Receipts from electricity sales 11,610,439 58,202,488
Payments received from other revenue sources - 631,219
Payments to purchase electricity (6,107,059) (45,546,712) Payments for contract services, general, and adminstration 735,200 (2,820,184) Payments for staff compensation (136,317) (1,004,293)
Other cash payments (0) (268,507)
Net cash provided (used) by operating activities 6,102,262 9,462,517
CASH FLOWS FROM NON-CAPITAL FINANCING ACTIVITIES
Principal payments of Debt (44,421) (170,576)
Interest and related expenses (1,243) (13,459)
Net cash provided (used) by non-capital financing
activities (45,664) (184,035)
CASH FLOWS FROM CAPITAL AND RELATED FINANCING ACTIVITIES Acquisition of nondepreciable assets
Acquisition of capital assets
Net cash provided (used) by capital and related financing activities
CASH FLOWS FROM INVESTING ACTIVITIES
Interest income 28,273 154,687
Net cash provided (used) by investing activities 28,273 154,687 NET CHANGE IN CASH AND CASH EQUIVALENTS 6,084,871 9,164,662 Cash and cash equivalents at beginning of period 10,739,674 70,769,086 Cash and cash equivalents at end of period 16,824,546 79,933,749 Cash and cash equivalents included in:
Cash and cash equivalents 12,269,507 12,269,507
Restricted assets 4,555,039 4,555,039
Cash and cash equivalents at end of period 16,824,546 16,824,546 (WITH YEAR TO DATE INFORMATION)
(UNAUDITED)
VALLEY CLEAN ENERGY ALLIANCE
STATEMENTS OF CASH FLOWS
FOR THE PERIOD OF AUGUST 1 TO AUGUST 31, 2023
5 FOR THE
PERIOD ENDING
AUGUST 31, 2023 YEAR TO DATE
Operating Income (Loss) 5,230,599 11,771,078
Depreciation expense
(Increase) decrease in net accounts receivable (1,021,656) (3,964,945) (Increase) decrease in accrued revenue 771,240 1,186,582 (Increase) decrease in prepaid expenses 15,342 (108,277) (Increase) decrease in other assets and deposits (0) (268,507) Increase (decrease) in accounts payable 13,585 (49,133) Increase (decrease) in accrued payroll (30,737) (61,162) Increase (decrease) in due to member agencies 2,602 (197,107) Increase (decrease) in accrued cost of electricity 97,644 (253,776) Increase (decrease) in other accrued liabilities 1,043,879 1,151,373 Increase (decrease) in user taxes and energy surcharges (20,236) 8,120 Net cash provided (used) by operating activities 6,102,262 9,214,246 FOR THE PERIOD OF AUGUST 1 TO AUGUST 31, 2023
VALLEY CLEAN ENERGY ALLIANCE
STATEMENTS OF CASH FLOWS
Adjustments to reconcile operating income to net cash provided (used) by operating activities:
RECONCILIATION OF OPERATING INCOME TO NET
CASH PROVIDED (USED) BY OPERATING ACTIVITIES
(WITH YEAR TO DATE INFORMATION)
(UNAUDITED)
VALLEY CLEAN ENERGY
2023 YTD ACTUAL VS. BUDGET
FOR THE YEAR TO DATE ENDING 08/31/23
Description YTD
Actuals
YTD
Budget
YTD
Variance
%
over/-under
Electric Revenue $ 65,311,824 $ 73,818,000 $ (8,506,176) -12% Other Revenues - Programs $ 631,219 $ 440,000 $ 191,219 43% Interest Revenues $ 154,687 $ 28,000 $ 126,687 452%
Purchased Power $ 45,217,150 $ 49,214,000 $ 3,996,850 8% Purchased Power Base $ 45,217,150 $ 46,870,000 $ 1,652,850 4% Purchased Power Contingency 2% $ - $ 2,344,000 $ 2,344,000 100% Labor & Benefits $ 944,847 $ 961,600 $ 16,753 2%
Salaries & Wages/Benefits $ 759,993 $ 800,000 $ 40,007 5% Contract Labor (SMUD Staff Aug) $ - $ 20,000 $ 20,000 100% Human Resources & Payroll $ 184,854 $ 141,600 $ (43,254) -31% Office Supplies & Other Expenses $ 181,566 $ 142,400 $ (39,166) -28% Technology Costs $ 29,342 $ 29,600 $ 258 1%
Office Supplies $ 8,004 $ 1,600 $ (6,404) -400%
Travel $ 15,621 $ 4,000 $ (11,621) -291%
CalCCA Dues $ 86,016 $ 88,800 $ 2,784 3%
CC Power $ 41,029 $ 16,800 $ (24,229) -144%
Memberships $ 1,555 $ 1,600 $ 45 3%
Contractual Services $ 2,107,899 $ 1,967,800 $ (140,099) -7% Other Contract Services $ - $ 17,600 $ 17,600 100%
Don Dame $ 2,622 $ 7,200 $ 4,578 64%
SMUD - Credit Support $ 154,389 $ 254,400 $ 100,011 39% SMUD - Wholesale Energy Services $ 1,001,370 $ 678,900 $ (322,470) -47% SMUD - Call Center $ 570,743 $ 556,200 $ (14,543) -3%
SMUD - Operating Services $ 133,739 $ 42,600 $ (91,139) -214% Commercial Legal Support $ 25,244 $ 20,000 $ (5,244) -26% Legal General Counsel $ 12,930 $ 108,800 $ 95,870 88%
Regulatory Counsel $ 101,159 $ 140,000 $ 38,841 28%
Joint CCA Regulatory counsel $ 12,852 $ 22,400 $ 9,548 43% Legislative - (Lobbyist) $ 44,000 $ 44,000 $ - 0%
Accounting Services $ 9,891 $ 19,200 $ 9,309 48%
Financial Consultant $ - $ 28,000 $ 28,000 100%
Audit Fees $ 38,960 $ 28,500 $ (10,460) -37%
Marketing $ 216,724 $ 176,000 $ (40,724) -23%
Marketing Collateral $ 185,996 $ 168,000 $ (17,996) -11% Community Engagement Activities & Sponsorships $ 8,000 30,728 $ (22,728) $ -284% Programs $ 766,505 $ 556,000 $ (239,262) -43%
Program Costs $ 28,757 $ 116,000 $ 87,243 75%
Programs - EV $ 115,105 $ - $ (115,105) 100%
Programs - AgFIT $ 642,428 $ 440,000 $ (202,428) -46%
Programs - Heat Pump $ 8,972 $ - $ (8,972) 100%
Rents & Leases $ 19,776 $ 17,600 $ (2,176) -12%
Hunt Boyer Mansion $ 19,776 $ 17,600 $ (2,176) -12%
Other A&G $ 294,685 $ 377,100 $ 82,415 22%
Development - New Members $ - $ 16,800 $ 16,800 100%
Strategic Plan Implementation $ 12,390 $ 96,000 $ 83,610 87% PG&E Data Fees $ 175,907 $ 184,000 $ 8,093 4%
Insurance $ 23,520 $ 7,600 $ (15,920) -209%
Banking Fees $ 82,868 $ 72,700 $ (10,168) -14%
Miscellaneous Operating Expenses $ 2,229 $ 4,800 $ 2,571 54% Contingency $ - $ 160,000 $ 160,000 100%
TOTAL OPERATING EXPENSES 49,780,138 $ 53,577,300 $ 3,797,162 $ 7% Interest on RCB loan $ 12,323 $ 13,600 $ (1,277) -9%
Interest Expense - Line of Credit $ - $ 40,000 $ (40,000) -100% NET INCOME 16,305,269 $ 20,655,100 $ (4,349,831) $ -21%