Item 6
VALLEY CLEAN ENERGY ALLIANCE
Staff Report – Item 6
______________________________________________________________________________ TO: Board of Directors
FROM: Mitch Sears, Executive Director
Edward Burnham, Finance and Operations Director
SUBJECT: Financial Update – March 31, 2024 (unaudited) financial statements (with comparative year to date information) and Actual vs. Budget year to date ending March 31, 2024
DATE: May 9, 2024
RECOMMENDATION:
Accept the following Financial Statements (unaudited) for the period of March 1, 2024 to March 31, 2024 (with comparative year to date information) and Actual vs. Budget year to date ending March 31, 2024.
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 March 31, 2024.
Financial Statements for the period March 1, 2024 – March 31, 2024 In the Statement of Net Position, VCE, as of March 30, 2024, has a total of $33,583,315 in its checking, money market and lockbox accounts, $1,100,000 restricted assets for the Debt Service Reserve account, and $1,800,000 restricted assets related to supplier deposits. On March 31, 2022, VCE’s net position was $43,738,951.
In the Statement of Revenues, Expenditures, and Changes in Net Position, VCE recorded $ 6,968,163 of revenue (net of allowance for doubtful accounts), of which $6,078,046 was billed in March, and $4,499,394 represent estimated unbilled revenue. The cost of electricity for the March revenue totaled Item 6
$4,774,698. For March, VCE’s gross margin was approximately 32% and the net income totaled $1,571,081. The year-to-date change in net position was 7,315,775.
In the Statement of Cash Flows, VCE cash flows from operations were $3,780,300 due to March cash receipts of revenues being more than the monthly cash operating expenses.
Actual vs. Budget Variances for the year to date ending March 31, 2024 Below are the financial statement line items with variances >$50,000 and 5% • Electric Revenue – ($627,001) and -3% – Unfavorable variance due to retail load variance lower than forecasted due to mild and wet winter.
• Purchased Power – ($1,958,028) and -10% – favorable mainly due to budgeted renewable energy certificates not procured, lower load due to mild and wet winter, and lower energy prices. • Reimbursable Revenues $605,500 (AgFIT) – unfavorable Variance - Reimbursable AgFIT revenues and associated program costs expected in May resulting in budget timing differences. • General Programs Costs $93,373 (AgFIT) – favorable Variance – Budgeted program costs are amortized for the year resulting in timing differences.
• AgFIT Programs Costs $489,687 (AgFIT) – Favorable Variance – Program costs are expected in May resulting in budget timing differences.
Attachments:
1) Financial Statements (Unaudited) March 1, 2024 to March 31, 2024 (with comparative year to date information.)
2) Actual vs. Budget for the year to date ending March 31, 2024
VALLEY CLEAN ENERGY ALLIANCE
FINANCIAL STATEMENTS
(UNAUDITED)
FOR THE PERIOD OF MARCH 1 TO MARCH 31, 2024
PREPARED ON MAY 1, 2024
2 ASSETS
Current assets:
Cash and cash equivalents $ 33,583,315
Accounts receivable, net of allowance 9,147,813
Accrued revenue 4,499,395
Prepaid expenses 34,611
Inventory - Renewable Energy Credits -
Other current assets and deposits 3,700,487
Total current assets 50,965,621
Restricted assets:
Debt service reserve fund 1,100,000
Total restricted assets 1,100,000
TOTAL ASSETS $ 52,065,621
LIABILITIES
Current liabilities:
Accounts payable $ 419,127
Accrued payroll 109,399
Interest payable -
Due to member agencies (1,723)
Accrued cost of electricity 3,924,268
Other accrued liabilities 2,044,009
Security deposits - energy supplies 1,800,000
User taxes and energy surcharges 31,591
TOTAL LIABILITIES $ 8,326,671
NET POSITION
Net position:
Local Programs Reserve $ 840,000
Restricted 1,100,000
Unrestricted 41,798,951
TOTAL NET POSITION $ 43,738,951
VALLEY CLEAN ENERGY ALLIANCE
STATEMENT OF NET POSITION
MARCH 31, 2024
(UNAUDITED)
3 FOR THE
PERIOD ENDING
March 31, 2024 YEAR TO DATE
OPERATING REVENUE
Electricity sales, net $ 6,968,163 $ 20,203,970
Other revenue - -
TOTAL OPERATING REVENUES 6,968,163 20,203,970
OPERATING EXPENSES
Cost of electricity 4,774,698 11,513,971
Contract services 186,716 603,265
Staff compensation 172,034 408,762
General, administration, and other 321,518 521,155
TOTAL OPERATING EXPENSES 5,454,966 13,047,153
TOTAL OPERATING INCOME (LOSS) 1,513,198 7,156,817
NONOPERATING REVENUES (EXPENSES)
Interest income 57,883 158,958
Interest and related expenses - -
Other Non Operating Revenues - -
TOTAL NONOPERATING REVENUES (EXPENSES) 57,883 158,958
CHANGE IN NET POSITION 1,571,081 7,315,775
Net position at beginning of period 5,714,148 36,423,176 Net position at end of period $ 7,285,229 $ 43,738,951
(WITH COMPARATIVE YEAR TO DATE INFORMATION)
(UNAUDITED)
VALLEY CLEAN ENERGY ALLIANCE
STATEMENT OF REVENUES, EXPENDITURES AND
March 31, 2024
4 FOR THE
PERIOD ENDING
MARCH 31, 2024 YEAR TO DATE
CASH FLOWS FROM OPERATING ACTIVITIES
Receipts from electricity sales $ 6,968,163 $ 20,203,970 Payments received from other revenue sources - -
Receipts for security deposits with energy suppliers - - Payments to purchase electricity (2,507,596) (8,712,522) Payments for contract services, general, and adminstration (508,234) (1,124,420) Payments for member agency services - -
Payments for staff compensation (172,034) (408,762)
Return of security deposits to energy suppliers - -
Other cash payments - -
Net cash provided (used) by operating activities 3,780,300 9,958,267
CASH FLOWS FROM NON-CAPITAL FINANCING ACTIVITIES
Principal payments of Debt - -
Interest and related expenses - -
Other Non Operating Revenue - -
Net cash provided (used) by non-capital financing activities - -
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 57,883 158,958
Net cash provided (used) by investing activities 57,883 158,958 NET CHANGE IN CASH AND CASH EQUIVALENTS 3,838,183 10,117,224 Cash and cash equivalents at beginning of period 30,845,132 28,579,933 Cash and cash equivalents at end of period 34,683,315 38,697,158 Cash and cash equivalents included in:
Cash and cash equivalents 33,583,315 37,597,158
Restricted assets 1,100,000 1,100,000
Cash and cash equivalents at end of period $ 34,683,315 $ 38,697,158
VALLEY CLEAN ENERGY ALLIANCE
STATEMENTS OF CASH FLOWS
MARCH 31, 2024
(WITH YEAR TO DATE INFORMATION)
(UNAUDITED)
5 FOR THE
PERIOD ENDING
MARCH 31, 2024 YEAR TO DATE
Operating Income (Loss) $ 1,513,198 $ 5,613,073
Depreciation expense
Revenue reduced for uncollectible accounts
(Increase) decrease in net accounts receivable (530,056) (593,095.56) (Increase) decrease in accrued revenue 751,521 313,839.15 (Increase) decrease in prepaid expenses (4,732) (5,880.34) (Increase) decrease in inventory - renewable energy credits - - (Increase) decrease in other assets and deposits (12,702) 15,756.69 Increase (decrease) in accounts payable 81,476 (54,547.41) Increase (decrease) in accrued payroll (17,549) (25,888.91) Increase (decrease) in due to member agencies - 5,855.40 Increase (decrease) in accrued cost of electricity 2,013,816 (1,645,382.32) Increase (decrease) in other accrued liabilities - -
Increase (decrease )security deposits with energy suppliers - - Increase (decrease) in user taxes and energy surcharges - - Increase (decrease) in security deposits from energy suppliers - - Increase (decrease) in user taxes due to other governments (14,673) 16,094.60 Increase (decrease) in advances from public purpose programs - Net cash provided (used) by operating activities $ 3,780,299 $ 3,639,825 (UNAUDITED)
MARCH 31, 2024
RECONCILIATION OF OPERATING INCOME TO NET CASH
PROVIDED (USED) BY OPERATING ACTIVITIES
Adjustments to reconcile operating income to net cash provided (used) by
VALLEY CLEAN ENERGY ALLIANCE
STATEMENTS OF CASH FLOWS
(WITH YEAR TO DATE INFORMATION)
VALLEY CLEAN ENERGY
2024 YTD ACTUAL VS. BUDGET
FOR THE YEAR TO DATE ENDING 03/31/24
Description YTD Actuals YTD Budget YTD Variance
% over
/-under
Total Revenues $ 20,362,957 $ 21,559,000 $ (1,196,043) -6% Electric Revenue $ 20,203,999 $ 20,831,000 $ (627,001) -3% Interest Revenues $ 158,958 $ 122,500 $ 36,458 30%
Reimbursable Revenues $ - $ 605,500 $ (605,500) -100%
Purchased Power $ 11,513,972 $ 13,472,000 $ (1,958,028) -15% Purchased Power Base $ 11,513,972 $ 12,830,000 $ (1,316,028) -10% Purchased Power Contingency 5% $ - $ 642,000 $ (642,000) -100% Labor & Benefits $ 461,661 $ 408,000 $ 53,661 13%
Salaries & Wages/Benefits $ 373,739 $ 336,000 $ 37,739 11% Contract Labor $ 35,000 $ 51,000 $ (16,000) -31%
Human Resources & Payroll $ 52,922 $ 21,000 $ 31,922 152% Office Supplies & Other Expenses $ 59,403 $ 74,100 $ (14,697) -20% Technology Costs $ 21,081 $ 9,600 $ 11,481 120%
Office Supplies $ 3,037 $ 3,000 $ 37 1%
Travel $ 1,039 $ 1,500 $ (461) -31%
CalCCA Dues $ 32,256 $ 36,000 $ (3,744) -10%
CC Power $ - $ 22,500 $ (22,500) -100%
Memberships $ 1,990 $ 1,500 $ 490 33%
Contractual Services $ 507,268 $ 592,950 $ (85,682) -14% Other Contract Services (e.g. IRP) $ - $ 7,500 $ (7,500) -100% Don Dame $ 1,079 $ 5,400 $ (4,321) -80%
Wholesale Energy Services (TEA) $ 157,196 $ 204,750 $ (47,554) -23% 2030 100% Renewable & Storage $ - $ 7,500 $ (7,500) -100% Customer Support Call Center $ 225,395 $ 201,000 $ 24,395 12% Operating Services $ 59,480 $ 15,000 $ 44,480 297%
Commercial Legal Support $ (5,321) $ 6,000 $ (11,321) -189% Legal General Counsel $ 10,051 $ 21,000 $ (10,949) -52% Regulatory Counsel $ 28,791 $ 51,000 $ (22,209) -44%
Joint CCA Regulatory counsel $ 8,952 $ 4,800 $ 4,152 87% Legislative - (Lobbyist) $ 22,000 $ 17,250 $ 4,750 28%
Accounting Services $ (5,855) $ 750 $ (6,605) -881%
Financial Consultant $ - $ 6,000 $ (6,000) -100%
Audit Fees $ 5,500 $ 45,000 $ (39,500) -88%
Marketing $ 44,689 $ 75,000 $ (30,311) -40%
Marketing Collateral $ 44,689 $ 72,000 $ (27,311) -38%
Community Engagement Activities & Sponsorships $ - $ 3,000 $ (3,000) -100% Programs $ 334,813 $ 824,500 $ (489,687) -59%
Program Costs (Rebates, Incentives, etc.) $ 86,627 $ 180,000 $ (93,373) -52% AG Fit $ 248,186 $ 640,000 $ (391,814) -61%
PIPP Program $ - $ 4,500 $ (4,500) -100%
Rents & Leases $ 17,940 $ 12,300 $ 5,640 46%
Hunt Boyer Mansion $ 17,940 $ 6,300 $ 11,640 185%
Lease Improvement $ - $ 6,000 $ (6,000) -100%
Other A&G $ 99,805 $ 184,900 $ (85,095) -46%
Development - New Members $ - $ 6,300 $ (6,300) -100%
Strategic Plan Implementation $ - $ 19,200 $ (19,200) -100% PG&E Data Fees $ 89,195 $ 72,000 $ 17,195 24%
Insurance $ 10,610 $ 12,000 $ (1,390) -12%
Banking Fees $ - $ 75,400 $ (75,400) -100%
Miscellaneous Operating Expenses $ 677 $ 3,000 $ (2,323) -77% Contingency $ - $ 60,000 $ (60,000) -100%
0 0
TOTAL OPERATING EXPENSES $ 13,040,228 $ 15,706,750 $ (2,666,522) -17% Interest on RCB Term loan $ - $ - $ - 100%
Interest Expense - Bridge Loan \ Line of Credit $ - $ - $ - 100% NET INCOME $ 5,852,250 7,322,729 $