The URL can be used to link to this page

Home My WebLink AboutAgenda Report - March 21, 2007 K-01AGENDA ITEM 0140 1 AMZMCITY OF WDI MIL COMMUNICATION TM AGENDA TITLE: Re ►e EleeVic Utlllty, Wastewater and Witter 2"° Quarter Flscal 07 FinaMoial Reports MEETIOG MATE: Mare 21, 2007 PREPARED BY: Electdc UlEity DimetorIMPUty City Mw app RECOINMOSDRD ACTION: Receive Electric Utility, Wastewater and Water Second Quarter Fiscal 07 Financial Reports. BACKGROUND IiNFORAIAIRON: In accordance with the Lodi Municipal Code, quarterly financial reports are to be prepared for the Electric Utility, Wastewater and Water operations. Highlights of the operations for all three utility operations will be conveyed in a power point presentation to be made on March 21, 2007. Electrig L*Hty The atftched PowerPoint report summarizes results for the 2'd quarter of Fiscal Year 07. A summary of the Electric Utility's financial performance for this reporting period is as follows: • EUD had an excellent 1st half of FY07 • mower costs declinEd -$760K • bion -power costs decreased --$1.1 million • Plevenues up about$500K • DCPA "GOR" up $945K • Overall increase in Cash is about $1.6M • Average rates about 10% below PG&E • IPY07 power costs remain substantially hedged Wast aw The attached PowerPoint seport summarizes resutts for the 2"d quarter of Fiscal Year 07 • I -ash balance is $3.7 million • Revenues are on target at 50.4 % of the annual budget • Operating expense# are under target at 38.2 % of annual budget Water The aftched PowerPoint vaport summarizes results for the 2"d quarter of Fiscal Year 07 • Cash balance is $3 miltlon • Revenues are on target at 48.9% of the annual budget • Operating expenses; are under target at 41.7% of annual budget. APPROVED: /l B ing, City Manager FISCAL IMPACT: FUNDMIG Norge at this time. Not Applicable. c Utiiity Director Attachments Krueger Deputy Citye. Manager Electric Utility Department FY07 Quarterly Update (Through December 31, 2006) City Council Meeting March 21, 2007 n �Q '9<�FSummary 0 " EUD had an excellent 1St half of FY07 • Power Costs declined ~$760K Non -power Costs decreased ~$1.1 million Revenues up about $500K NCPA "GOR" up $845K • Overall increase in cash is about $1.6M Average rates about 10% below PG&E FY07 power costs remain substantially hedged 2 Q2 Financial Results Cash Flow Ending December 31, 2006 Revenue Projections Actuals Difference Total Revenues 36,17608 36,767,492 590,794 Expenses Purchase Power Non Power 24,018,933 51938,141 23,250,096 4,831,823 768,837 11106,318 Total Expenses 29,957,074 28,081,919 11875,155 Net Revenue for Debt Service 65219,624 85685,573 25465,949 Debt Service - - - Net Revenue 6,219,624 81685,573 21465,949 In -lieu Transfer to General Fund Other changes in working capital 31389,500 41479,479 31389,500 41479,479 - - Net Increase (Decrease) in Working Capital (1,6499355) 816,594 r 294659949 Beginning Cash Balance 396319402 396319402 2,465,949 Changes in GOR 845,702 845,702 Ending Cash Balance 298279749 592939698 3 Electric Expenses by Series Personnel $ 6 162 788 $ 2,598,618 42.2% Su lies Materials Services $ 1 347 619 $ 480,515 35.7% E ui ment, Land, Structures $ 905,041 $ 131,938 14.6% Other Payments $ 479,100 $ 128,458 26.8% Communication &Transportation $ 81,683 $ 43,214 52.9% Total Operating Expenses $ 8,976,231 $ 3,382,743 37.69% Note: Includes Capital Expenditures 4 Q2 Power Supply Generation $21,029,257 $227091,535 $ 1,062,278 5.1% Transmission $ 2,6947791 $ 27832,943 $ 1387152 5.1 Management Services $ 1,066,836 $ 1,069,859 $ 31023 0.3% Third Party Revenue $ 771,951 $ 277447251 $ 179727300 255.5% TOTAL $24,018,933 $23,250,086 $ (768,847) -3.2% 6i NCPA "GOR" • General Operating Reserve • Provides funding for contingencies • GOR levels ➢$3,113,432(June 30, 2006) ➢$3,959,134 (December 31, 2006) $845,702 Increase C.1 Q2 Sales July 2006 0 0 650 504 August 2006 0 0 449 430 September 2006 3 13 288 263 October 2006 96 76 9 73 November 2006 316 348 2 - December 2006 530 609 - - Q2 Total 945 1, 046 1, 398 19270 7 FY07 "Open Position'w q<�FOR� Note: 12,602 MWH equals an annualized open position of -2.6%. 1.1 F <0 00 q<,F0 PILOT Reduction • Past City policy provided that the utility may transfer up to 12% of electric revenues to the General Fund as Payment in Lieu of Taxes (PILOT) • City Council approved a new policy on 2/7/07 limiting increases in the PILOT to changes in number customers • FY07 PILOT was budgeted as 10.6% of revenue. This % declines going forward since customer growth lags revenue growth. PILOT History 10 PILOT (%) 12.50% 12.00% 11.50% 11.00% 10.50% 10.00% 9.50% 9.00% 2001 2002 2003 2004 2005 2006 2007 2008 10 FY07 Financials 11 Total Revenues Purchase Power 66,499,744 42,544,974 36,767,492 23,250,096 66,670,082 42,613,780 Non Power 11,201,370 4,831,823 10,216,805 Total Expenses 53,746,344 28,081,919 52,830,585 Net Revenue for Debt Service 12,753,400 8,685,573 13,839,497 Debt Service 6265,778 - 6,265,778 Net Revenue 6,487,622 8,685,573 7,573,719 In -lieu Transfer to General Fund 6,779,0001 3,389,500 6,779,000 Other changes in working capital - 4,479,479 - Net Increase(Decrease) in Working Capital(291,378)1816,594 794,719 Changes in GOR 365,185 845,702 1,145,702 Ending Cash Balance 3,705,209 5,293,698 595719823 11 Rate Comparison 12 Discount Programs 13 G��-4� 4 gt,Fo�� Lodi Electric Utility Discount Programs As of February, 2007 14 No. of Program What is it? How Administered Customers 25% discount for qualified applicants. First application is certified by Applicant must have medical condition Doctor. Every two years a self - Medical Rider requiring extra electricity or space certification is sent to customer. 431 conditioning. Does not exclusively EUD processes these applications. state medical conditions. 30% income based discount for Applications certifying income are qualified applicants. Maximum processed by the Finance SHARE 1,842 ' household income beginning at Department. Income is certified, $22,000 for 1 to 2 persons. by Finance. 35% for those who qualify for both Follows above certification Medical/SHARE176 SHARE and Medical Rider. process. 5% for those over 62 years of age Applicants are certified by the Fixed Income and fixed income below $45,000. Finance Department. 113 Total Customers using Discount 2,562 Programs As of February, 2007 14 Projected Discounts (FY07) Customer Class Amount Subject to Discount Amount of Discount Given Amount Due Discount Fixed Income $ 100,176 $ (5,009) $ 95,167 5% Medical $ 949,835 $ (237,465) $ 712,370 25% Share $ 2,051,591 $ 615,488 $ 1,436,103 30% Medical/Share $ 245,885 $ (86,060) $ 159,824 35% Total $ 39347,487 1 $ (944,022) $ 21403,465 28% Note: Actual through December, 2006 and projected thereafter 15 Neighboring Agency Discount Programs Agency/Program I Discount I Lodi Medical Low Income Roseville 50% discount on first 500 kWh and 15% on all other kWh usage. 30 Roseville Must meet income (limits are higher than those for low income 25 PG&E program) and qualifying device criteria. 30 SMUD 30% discount of service charge, 35% discount of energy charges for 25 Tier 1 quantities and 30% discount Tier H & III. PG&E Additional baseline quantity 500 kWh per month 25 Modesto 50% discount on first 500 kWh Low Income Roseville 15% discount 30 SMUD 30% discount of service charge, 35% discount of energy charges for Tier 1 quantities and 30% discount Tier 11 & III 30 PG&E 20% discount. 30 Modesto 22.1% discount plus $7.50 reduction in customer charge 30 MedicaMow Income SMUD 50% discount of service charge, 55% discount of energy charges for 35 Tier 1 quantities and 30% discount Tier H & Ill. Senior Discount Roseville 1 25% discount on water and sewer, and 20% on refuse. 1 5 16 n �Q '9<�FSummary 0 " EUD had an excellent 1St half of FY07 • Power Costs declined ~$760K Non -power Costs decreased ~$1.1 million Revenues up about $500K NCPA "GOR" up $845K • Overall increase in cash is about $1.6M Average rates about 10% below PG&E FY07 power costs remain substantially hedged 17 Water and Wastewater FY07 Quarterly Update (Through December 31, 2006) City Council Meeting March 21, 2007 18 Summary • Wastewater and Water had a good 1 St half of FY07 • Wastewater cash balance is $3.7 million • Wastewater Fund Revenues on target at 48.9 % of estimated • Wastewater Fund Operating expenses are 41.7% of budget • Water Fund Cash balance is $.8 million • Water Fund Revenues are on target at 50.4% of estimated • Water Fund Operating expenses are 38.2% of budget Wastewater Financials Ending 12/31/06 Sales Revenues $810161500 $4,070,362 50.8% Other Revenues 4841400 366,584 75.7% Impact Mitigation Fees 1,6075000 505,843 31.5% Total Revenues Operating $10,107,900 $5,0635121 $49942,789 $291105462 48.9% 41.7% Non -Operating 9085793 454,632 50.0% Capital Outlay (From Revenues) 2989500 0.0% Total Expenses $612701414 $25565,094 40.9% Net Revenue for Debt Service $31837,486 $2,3771695 62.0% Debt Service 3,339,110 11730,919 51.8% Net Revenue $4985376 $6461776 129.8% Less In -lieu Transfer to General Fund 8925500 4469250 50.0% Net Increase (Decrease) in Cash Other Changes in Cash ($394,124) (1,010,000) $200,526 (760,023) -50.9% Ending Cash Balance $195529830 $396929203 237.8% Debt Proceeds Reserve $13,869,759 W Wastewater Operating Expenses by Series Personnel $ 2,468,321 $ 1,115,253 45.2% Supplies, Materials, Services 877,254 395,943 45.1 E ui ment, Land, Structures 102,675 41,449 40.4% Other Payments 795,313 253,861 31.9% Communication & Transportation 819,558 303,956 37.1% Total Operating Expenses $ 5,063,121 $ 2,110,462 41.7% 21 Water Financials Ending 12/31/06 Sales Revenues $9,707,100 $5,148,747 53.0% Other Revenues 3991900 201336 5.1% Impact Mitigation Fees 2349000 41,044 17.5% Total Revenues Operating $1053415000 $4,468,583 $5,210,127 $1,707,456 50.4% 38.2% Non -Operating 909,259 4545630 50.0% Capital Outlay (From Revenues) 6,926,748 210501161 29.6% Total Expenses $12,304,590 $49212,247 34.2% Net Revenue for Debt Service ($1,963,590) $9975880 -50.8% Debt Service 227,976 173754 7.8% Net Revenue ($2,191,566) $980,126 In -lieu Transfer to General Fund 7675040 3835520 50.0% Net Increase (Decrease) in Cash Other Changes in Cash Ending Cash Balance ($2,958,606) 219081617 $7799001 $690569155 $596,606 r 925603 $7769345 $8073642 -20.2% 22 Water Expenses by Series Personnel $ 1,211,337 $ 509,528 42.1% Su lies, Materials, Services 621,811 146,126 23.5% Equipment, Land, Structures 3,851 176 4.6% Other Payments 1,751,844 672,841 38.4% Communication & Transportation 879,740 378,785 43.1% Total Operating Expenses $ 4,468,583 $ 1,707,456 1 38.2% 23