Bolinas Community Public Utility
A Meeting of the Finance Committee
Of The Board Of Directors
April 9, 2013 270 Elm Road, Bolinas
1. Call to Order.
Directors Amoroso and Kimball present; General Manager
Jennifer Blackman also present.
3. Potential Alternatives for Investment of District Funds.
Staff presented the Committee with information about the
Local Agency Investment Fund (“LAIF”), which is administered by the State
Treasurer. This program allows local agencies and special districts
to participate in a major portfolio which invests hundreds of millions of
dollars under the expertise of the State’s Treasurer’s investment staff at
no additional cost to taxpayers. Unlike the CDARs program in which
the BCPUD currently has approximately $750,000 invested, the LAIF is completely
liquid. In addition, the LAIF is earning just under 0.3% interest,
whereas the BCPUD’s investments in the CDARs program are earning only 0.1%.
The Committee agreed that the LAIF could be a good short-term solution for
where to invest the district funds when the CDs mature in September.
Director Kimball reported that she spoke with her personal
investment advisor and he recommended that the district keep its funds as
liquid as possible, so the longest-term CD in which the district should invest
is 2 years. He also recommended strongly against investing in any bonds
or bond funds given the uncertainties in that market. After further
discussion, the Committee asked staff to include an item on the agenda for
the full Board’s regular April meeting to consider investing in the LAIF.
4. Review Balance of Proceeds from District’s Sale of its Pine Gulch
Creek Property to the National Park Service; Discuss Possible Revisions.
The Committee reviewed the accounting spreadsheet prepared
last year to document expenditures to-date from the proceeds from the district’s
sale of its Pine Gulch Creek property to the National Park Service.
Discussion ensued and the Committee directed staff to revise the spreadsheet
to include updated figures concerning the water supply study, interest adjustments
(to show interest earned to-date) and proposed expenditures from these proceeds
for the FY 2013-14. The Committee also asked staff to include an item
on the full Board’s regular April meeting agenda to review the updated spreadsheet.
5. Recommendation to Board re: Proposed Increase of Quarterly
Metered Water Rates for FY 2013-14.
Staff presented information concerning the rates charged
by the Inverness Public Utility District (“IPUD”) and the Stinson Beach County
Water District (“SBCWD”). This information shows that whereas the BCPUD
currently charges $1.00 per 100 cubic feet of water up to 1500 cubic feet
of water per quarter, the SBCWD charges $1.95 for the same amount, and the
IPUD charges $2.30. In addition, whereas the BCPUD currently charges
$1.50 per 100 cubic feet of water for 1600 – 2100 cubic feet of water per
quarter, the SBCWD charges $4.68 for the same amount and the IPUD charges
$3.45. As such, it is clear that the BCPUD is charging less than its
neighboring districts for water at the two lowest tiers. Staff also
noted that the average consumption in Bolinas is 2260 cubic feet of water
per quarter for which a customer would pay $25.50 per quarter, or $102.00
per year. In Stinson Beach this same amount of water would cost a customer
$53.82 per quarter, or $215.28 per year and in Inverness, this same amount
of water would cost a customer $55.20 per quarter, or $220.80 per year.
Staff noted that at the last Board meeting, there was
the concept of increasing rates only at the two lowest tiers. Several
Board members expressed a preference for an across-the-board percentage increase
in rates. Accordingly, staff presented a potential 20% increase in
rates as follows:
Proposed New Rate
for up to 1500 c. ft/quarter
for 1600 – 2100 c. ft./quarter
for 2200 – 2800 c. ft./quarter
for 2900 - 4000 c. ft./quarter
for 4100 – 6000 c. ft./quarter
for 6100 – 7500 c. ft./quarter
for over 7600 c. ft./quarter
Staff said the proposed new rates would still be much less than the rates
charges by the SBCWD and comparable to the rates charges by the IPUD, except
at the three highest tiers. Staff noted that a 20% increase in
rates would result in approximately $24,000 more in revenue from water sales
each year. After some discussion, the Committee asked staff to include
an item on the full Board’s regular April meeting agenda to consider a proposed
20% increase in water rates.
6. Draft Fiscal Year 2013-14 Budget.
The Committee reviewed a revised draft budget, which incorporates
the changes discussed at the last meeting and which projects a revenue shortfall
of approximately $17,000 on the water side and $14,000 on the sewer side.
However, staff noted that the revised budget does not yet reflect the revised
(higher) anticipated cost of the Terrace Avenue water main loan. (Per
correspondence just received from the state funding agency, the BCPUD’s annual
debt service cost of the loan will increase as a result of the recently approved
increase in loan amount; the budget thus far included $23,000 in debt service
for this loan, but this number needs to be revised to approximately $30,000.)
Discussion ensued about potential personnel changes in the upcoming fiscal
year which could reduce operating costs and staff agreed to quantify those
changes into the next revision of the budget.
The next meeting of the Finance Committee is scheduled for May 7, 2013 at
7. Community Expression.