HomeMy WebLinkAboutAgenda Report - May 3, 2006 K-09AGIEN llfA ITEM KftCl
CITY OF Logi
NW COUNCIL COMMUNICATION
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AGENDA TITLE: Receiv* Information regarding transfer of funds to the Electric Utility Capital
Outlay Fund 161 ($2,000,000) (EUD)
MEETIN4 DATE: May 3, 2006
PREPAIWD BY: Electric Utility Director
RECOMMEND ACTION: That the City Council receive information regarding the transfer of
funds to the Electric Utility Capital Outlay Fund 161 in the amount of
$2,000,000.
BACKGROUND INFORMATION: As discussed with the City Council on prior occasions, the Electric
Utility's (EU) present financial condition is extremely weak. As of
April 21, 2006, the electric utility's cash balance was $1,146,923.
Cash balances excluding the mounts held by the Northern California Power Agency (NCPA), fluctuate
based on receipts and the timing of critical payments. It has dipped as low as -$257,970 during recent
periods.
Current projections indicate that the utility will have little or no cash balance at fiscal year-end assuming
no extraordinary cash infusions or significant changes in forecasted costs and/or revenues. The City
Manager is authorized to utilize bond proceeds for any projects identified in the bond indenture
documents approved by the City Council at the time bonds were issued. During the course of fiscal
year 2005-06, the Electric Utility has expended approximately $1.3 million (and may expend up to $2.0
million by June 30, 2006) on the type of authorized projects as enumerated in the bond indenture
documents. It was anticipated that operating cash balances would be used for the projects worked on
by the Electric Utility in this fiscal year with little (if any) need for the use of bond proceeds for these
projects. Due to the strain on operating cash balances from escalating power costs, operating cash will
not be sufficient to pay for these projects and bond proceeds will be needed instead. Therefore, City
Council is being apprised by this agenda item of the intent of staff to utilize approximately $2.0 million of
bond proceeds for the reimbursement of projects as previously authorized in the Bond indenture
documents for the purposes as enumerated in those documents.
Attached is a listing of qualified capital -type expenditures through February 28, 2006 and a projection
for fiscal year-end. The current balance in the electric bond proceeds account is $11,772,688.
FISCAL WPACT: Improve the Electric Utility Department fund balance.
FUNDING: Electric System Revenue Certificates of Participation Series A & B 2002
$2,000,000. �o
Ruby P10te, Interim Finance Director
APPROVED:
Blair 14W, City Manager
Transfer of funds to the Electric Utility Capital Outlay Fund 1 2,000,000) (EUD)
May 3, 2006
Page 2of2 m 'L
George F. Morrow
Electric Utility Director
Prepared By: Stacy Olson, Rate Analyst
cc: City Attorney
DeptAyy City Manager
FY 2005-2006
Capital Expenditures
BSU No.
Description
Actual
(YTD Feb 2006)
Projected
(March -June 2006)
FYE 05-06
Total
161633
Streetli htSafet Improvement
$
42,880.00
$ 21,440.00
$ 64,320.70-
161651
Line Extensions
$
323,440.00
$ 161,720.00
$ 485,160.00
161652
Distribution System Improvement
$
154,231.00
$ 57,500.00
$ 211,731.00
161653
Service Connections
$
157,121.00
$ 39,280.25
$ 196,401.25
161654
Dusk to Dawn Lighting
$
3,721.00
$ 1,860.50
$ 5,581.50
161655
Substructures
$
60,545.00
$ 30,272.50
$ 90,817.50
161656
Service Connections(metering)
$
89,987.00
$ 28,266.67
$ 118,253.67
161657
Substation Construction, High Voltage
$
2,101.00
$ -
$ 2,101.00
161669
Substation Block Wall -Henning
$
4,362.00
$ 65,138.00
$ 69,500.00
161672
Streetlight Improvements
$
37,279.00
$ -
$ 37,279.00
161674
Streetlight Standards Upgrade
$
32,896.00
$ 16,448.00
$ 49,344.00
161677
Killelea Substation Construction
$
79,440.00
$ 298,200.00
$ 377,640.00
161679
Operations Center Modification
$
1,772.00
$ -
$ 1,772.00
161680
60kV Line Industrial S/S, High Voltage
$
37,931.00
$ -
$ 37,931.00
161685
Fiber Optic
$
206,915.00
$ 15,840.00
$ 222,755.00
FY 05-06 Utility Outlay Fund Total
$
11234,621.00
$ 735,965.92
$ 1,970,586.92
4/27/2006