G:\PW\Admin\Budget\FY 2021-22\WATER\Staff Report
CITY OF SIMI VALLEY
MEMORANDUM
June 27, 2022
TO: Board of Directors
Ventura County Waterworks District No. 8
FROM: Department of Public Works
SUBJECT: APPROVAL OF SUPPLEMENTAL BUDGET REQUEST TO ADJUST
WATERWORKS DISTRICT REVENUES AND EXPENDITURE S FOR
FISCAL YEAR (FY) 2021-22
STAFF RECOMMENDATION
It is recommended that the Board of Directors approve a supplemental budget request to adjust the Waterworks District revenues and expenditures, in Fund 761, for FY 2021-22.
BACKGROUND AND OVERVIEW
The Waterworks District (District) purchases water from the Calleguas Municipal Water District (Calleguas) to provide water to Di strict customers. The District’s operating budget annually estimates the amount of water used by its customers and the estimated cost of the water. The revenue of the water from District customers offsets the expense of the water. However, b oth water purchase and revenue received can vary greatly year-to-year dependent upon weather conditions such as rainfall or drought, and water conservation.
FINDINGS AND ALTERNATIVES
The approved (revised) District operating budget for water purchase in FY 2021-22 is $30,624,000. Due to the unpredictability of weather patterns , including a warm and extremely dry winter (January – April, 2022 especially), water demands by the customers are exceeding the prediction made at the time the budget was approved. Staff expects that the cost of water purchased may exceed the budget by up to $3,000,000 once final invoicing and payments are accrued for the fiscal year. However, as noted, water revenues will also increase by a similar dollar amount, which will offset this expenditure cost. Therefore, the District fund balance will not be impacted. It is recommended that the Board approve a supplemental budget request to increase the District's FY 2021-22 expenditure fo r water purchases by $ 3,000,000, and increase the revenue fo r water purchases by $3,000,000.
AGENDA ITEM NO.
Consent (3)
G:\PW\Admin\Budget\FY 2021-22\WATER\SR Water Budget Supp FY 22 The following alternatives are available to the Board of Directors:
1. Approve a supplemental budget request to adjust the Waterworks District revenues and expenditures by $ 3,000,000, in Fund 761 (Waterworks District No. 8), for FY 2021-22;
2. Provide staff with other direction.
Staff recommends Alternative No. 1.
SUGGESTED BOARD MOTION
I move to approve a supplemental budget request to adjust the Waterworks District revenues and expenditures by $3,000,000, in Fund 761 (Waterworks District No. 8), for FY 2021-22.
SUMMARY
The Waterworks District (District) purchases water from the Calleguas Municipal Water District to provide water to Di strict customers. Due to the unpredictability of weather patterns, including a warm and dry winter , water demands have exceeded predictions made at the time the budget was developed. It is expected that the cost of water purchased will exceed the bud get by approximately $3,000,000 once final invoicing and payments are accrued for the fiscal year. However, water revenues will also increase by a similar dollar amount, which will offset this expenditure. Therefore, staff recommends that the Board of Directors approve a supplemental budget request to adjust District revenues and expenditures for FY 2021-22.
____________________________________
Ronald K. Fuchiwaki
Public Works Director
Prepared by: Joe Deakin, Assistant Public Works Director 2