BRIGITTE GRAHAM BRIGITTE GRAHAM GRAEME DINWOODIE JEFF ANDERSON BRIGITTE
[1. CALL TO ORDER AND ROLL CALL]
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GRAEME DINWOODIE JEFF ANDERSON MARIE SANTANA PEDRO RODRIGUEZ RODRIGUEZ ERIN TERAN TERAN RAMIREZ INDIANA IN-PERSON IN-PERSON ELAINE HOLMES WAYMOND FERMON OSCAR ORTIZ LUPE RAMOS AMITH GLEN MILLER MILLER ROLL CALL HUNTER LOPEZ SAYING THE PLEDGE.THIS IS A TIME SET ASIDE FOR PUBLIC COMMENT ITEMS NOT ON THE AGENDA.
DO WE HAVE ANY PUBLIC COMMENTS?
>> WE ARE GOING ROLL INTO STUDY SESSION 4.1.
[4.1 A City Council Study Session for Discussion and Possible Direction on ...]
CITY COUNCIL STUDY SESSION ON DISCUSSION AND POSSIBLE DIRECTION ON THE FOLLOWING INDIO WATER AUTHORITY LONG RANGE FINANCE PLAN REY TREJO.>> TODAY WE HAVE A PRESENTATION ON OUR LONG RANGE FINANCE PLAN.
DISCUSSION AND DIRECTION FROM WHERE WE GO WITH THE RECOMMENDATIONS WE HAVE WITH YOU TODAY.
UP ON THE SCREEN YOU'LL SEE THE PRESENTATION.
I WANT TO PAUSE AND INTRODUCE MY MANAGEMENT TEAM, BRIAN, DIRECTOR OF FINANCE AND CUSTOMER SERVICE.
MIGUEL WHO IS OUR MANAGER OF OPERATIONS ACID MANAGEMENT AND MICHELLE MANAGER OF PLANNING AND CONSERVATION.
THEY HAVE HELPED ME TO DELIVER WHAT WE HAVE IN FRONT OF US TODAY.
WE'LL BEGIN WITH THE PRESENTATION.
OBJECTIVES FOR TODAY IS TO, TO PRESENT OUR FINANCIAL REQUIREMENTS ALSO PRESENT FINANCE OPTIONS TO MEET REQUIREMENTS AND OBLIGATIONS AND SEEK INPUT AND NEXT STEPS FROM THE COUNCIL.
I DO WANT TO TAKE SOME TIME TO DEFINE THE PURPOSE OF OUR FUNDS SO WE SET A BASELINE AS TO WHAT WE ARE STUDYING TODAY AND PRESENTING TODAY.
OPERATING FUND WHICH IS A SPECIFIC PURPOSE WATER QUALITY STAFFING AND OPERATIONS.
FINANCE PLAN BASED ON RESIDENTIAL RATE BASE.
SECOND ONE I WANT TO FOCUS OUR ATTENTION TO, CAPITAL CASH FUND.
OBLIGATION TO FUND OUR INFRASTRUCTURE REPLACEMENT.
RATE-BASED FUND FOR EXISTING CUSTOMERS.
LAST TIME THAT WAS APPROVED 2013.
THOSE ARE THE TWO FUNDS WE ARE GOING TO FOCUS ON TODAY'S STUDY SESSION.
SUPPLEMENTAL WATER SUPPLY FUND.
VERY SPECIFIC PURPOSE OF FUND OUR WATER SUPPLY FOR GROWTH SPECIFICALLY.
THAT IS A FEE-BASED FUNDING PLAN.
LAST TIME THAT WAS UPDATED WAS 2013.
WE'LL GET INTO RECOMMENDATIONS WHAT WE PLAN TO DO GIVEN IT IS A LITTLE OUTDATED AND REVISIT THAT.
LAST OF OUR FUNDS DEVELOPER IMPACT FUND FOR INFRASTRUCTURE FOR GROWTH.
AS YOU RECALL COUPLE OF WEEKS AGO, COUNCIL APPROVED THE FUND.
MOST RECENTLY ADOPTED FOR GROWTH.
I'LL DRAW YOUR ATTENTION TO OPERATING FUNDS AND CAPITAL CASH FUND SPECIFICALLY RELATED TO A RATE STRUCTURE.
WITH THAT FOCUS TODAY'S PRESENTATION WILL COVER THE OPERATING AND CAPITAL FUND INVOLVES WATER MASTER PLAN UPDATE, OPERATIONS AND SERVICES.
WITHIN THAT FUND, WE FUND CONSERVATION, WE'LL GO OVER THE PROGRAM.
ALSO SEE EFFECTS OF CONSERVATION AND HOW OUR REGIONAL PROJECTS WILL RELY ON CONSERVATION.
LAST THING I'LL SPEAK TO REALLY EXTRAORDINARY MANDATE BY THE STATE.
WE HAVE BEEN PRESENTING TO YOU AND GIVING YOU UPDATES WITH CHROMIUM 6.
VERY WELL DEFINED SCHEDULE AND PLAN TO IMPLEMENT.
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WE'LL GO THROUGH RATE IMPLICATIONS.BEGINNING WITH THE WATER MASTER PLAN UPDATE CONCLUDED WITH COVID AND ALL, WE WERE ABLE TO MAKE SURE RECOMMENDATIONS ARE STILL IDEAL AND ADEQUATE FOR 10-YEAR FORECAST.
CONSISTS 32 MILLION DOLLARS OF INFRASTRUCTURE.
THAT SPECIFICALLY IS NOT FOR GROWTH RATHER OUR EXISTING CUSTOMER BASE.
I HAVE HIGHLIGHTED SOME OF THE MOST VISIBLE PROJECTS.
PLANT 2 BUSTER PUMP STATION REPLACEMENT.
THAT IN FACT IS OUR OLDEST FACILITY.
WE HAVE A CONSULTANT TEAM THAT REVIEWED AND CONFIRMED IT REACHED ITS USEFUL LIFE AND IT IS TIME TO NOW REPLACE THAT.
THAT IS INCLUDED AS PART OF 32 MILLION.
WE HAVE A MILD PROJECT BREAKING GROUND IN JANUARY AND WESTWARD HO PIPELINE.
WELL REHAB PROGRAM PRESENTING THAT TO PROLONG THE LIFE OF OUR WELLS.
FIRE HYDRANT REPLACEMENT PROGRAM TO INSURE SAFETY OVER RESIDENTS.
MIGUEL VERY INVOLVED IN ASSET MANAGEMENT SYSTEM AND REPLACEMENT.
AND LAST WE ALSO INCLUDED BACKUP GENERATOR LINE ITEM IN OUR CIP.
FOR THE MOST PART IT IS WELLS.
WE WANT TO MAKE SURE WE HAVE THAT PROTECTION.
I WANT TO POINT OUT MASTER PLAN UPDATE INCLUDES PIPELINE REPLACEMENT.
WE ARE WORKING CLOSELY WITH TIM'S GROUP IN COLLABORATION WITH PUBLIC WORKS PROJECT SPECIFICALLY AVENUE 44 BRIDGE REPLACEMENT.
IT HAS BEEN GREAT WORKING WITH JUAN AND HIS TEAM SO WE CAN FUND RESPECTIVE AREA THAT EFFECTS IWA.
SUCCESSFUL GETTING GRANT FOR DOWNTOWN STORM WATER PROJECTS.
COLLABORATING WITH JUAN AND TIM.
WE HAVE A LINE ITEM IN OUR CIP THAT WILL ADDRESS THE DOWNTOWN AREA.
ANY STREETS CUT PLAN IN PLACE TO DESIGN AND PUT CUT IN THE STREETS SO WE DON'T HAVE TO CUT THE STREETS IN THE FUTURE.
LAST ITEM, ALLEY SERVICE RELOCATIONS IN DOWNTOWN.
ANY TIME WE CUT A STREET, TAKE PUNT TO RELOCATE ALLEYS OVER ON TO THE STREETS.
WE NEED A BUDGET ITEM TO DO THAT AND COMPLETE THE WORK.
THAT IS DEFINING OUR NEEDS NEXT AGAIN THE TEAM THAT IS HERE TODAY TOOK A CLOSE LOOK AT OUR STAFFING PLAN AND ANNUAL BUDGET 6.41 MILLION INCLUDES OVERHEAD, ALL THE MEDICAL, ALL THE DIFFERENT BENEFITS.
THAT INCLUDES ADMINISTRATION, FINANCE, ENGINEERING, PRODUCTION AND WATER DIRECTION PART OF THE FINANCE PLAN WE HAVE.
ALL OF THESE ITEMS I AM SHARING IS PART OF A LONG-REACH FINANCIAL MODEL THAT WILL YIELD RESULTS AND DEFINE RATE IMPLICATIONS IT HAS FROM THE RATE PAYORS.
OPERATES AND SERVICES, ANNUAL BUDGET 14.9 MILLION DOLLARS.
SERVICES, CHARGES, SUPPLIES, FIXED ASSETS INTERNAL SERVICE CHARGES, EXISTING DEBT SERVICE OF -- EQUIPMENT REPLACEMENT AND POWER REQUIREMENTS.
ANY PAYMENTS TO IID INCLUDED IN THIS LINE ITEM.
LAST BUT NOT LEAST CONSERVATION PROGRAM.
THAT IS PART OF THIS RATE STRUCTURE, LONG-TERM RATE STRUCTURE PLAN.
WE HAVE APPROXIMATELY $55,000 A YEAR BUDGETED IN OUR TENURE PLAN.
THAT INCLUDES TURF REMOVAL REBATE PROGRAM.
WATER USE EFFICIENCY DEVICE REBATES.
EDUCATION AND OUTREACH AND ANY OTHER BENEFICIAL PROJECTS THAT WILL BEAUTIFY
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THE CITY AS WELL.THEN THE BOARD POLICIES AND CONSERVATIONS ALSO PART OF OUR CONSERVATION PROGRAM.
WHAT WE MEAN BACK IN JULY, COUNCIL ADOPTED WATER SHORTAGE CONTINGENCY PLAN.
THAT INVOLVES SIX VERY DRAMATIC ACTION PLANS IN THE EVENT OF A SEVERE DROUGHT.
LEVEL 1 IS VOLUNTARY CONSERVATION.
AS WE GET INTO A STAGE OF DIFFICULTY, THOSE DIFFERENT LEVELS THAT HAVE TO BE APPROVED BY THE COUNCIL EVERY TIME AS DRASTIC AS NOT HAVING ANY NEW METERS INSTALLED IN OUR CITY.
THAT IS HOW SEVERE THE WIDE RANGE OF THE COUNCIL.
PART OF OUR CONSERVATION STRATEGY, AS WE DEVELOP NEW IDEAS, HOW DO WE TREAT POOLS WHEN WE ARE AT A SEVERE DROUGHT STAGE? OVER THE COMING WEEKS AND MONTHS, WE'LL SHARE THAT INFORMATION DEPENDING HOW THE HYDROLOGIES DEVELOPMENT.
THE WHOLE EXECUTIVE ORDER FROM THE GOVERNOR COMES TO BE LIGHTER.
IF IT IS NOT WE HAVE AN ACTION PLAN THAT WILL BRING TO ATTENTION MORE INFORMATION AS WE PROCEED.
HOW DOES THE CONSERVATION PLAN, WHAT DOES THAT LOOK LIKE OVER THE LAST 10 YEARS? HAS IT BEEN BENEFICIAL.
IN FRONT OF YOU THE CHART ANNUAL PRODUCTION TO THE IWA.
ANNUAL ACRE FEE WE PRODUCE FROM THE BASIN.
IN 2009, PUMPING MORE THAN 23,000 ACRE FEET.
BECAUSE OF THE VERY ROBUST CONSERVATION PROGRAM.
YOU CAN SEE HOW THE ANNUAL PUMPING WAS REDUCED EACH AND EVERY YEAR.
SPECIFIC PROGRAMS IN PLACE YOU'LL SEE THAT AS TIME GOES BY GROWTH IN INDIO.
YET OUR PRODUCTION FOR A GREATER POPULATION STILL LESS THAN 2009.
PROOF IS CONSERVATION IS WORKING.
VERY BENEFICIAL TO US TO CONTINUE THAT PROGRAM.
ONE LAST THING I'LL POINT YOU.
2010, GALLONS PER CAPITA PER DAY BASED ON URBAN WATER MANAGEMENT PLAN SPECIFIC TO INDIO WATER AUTHORITY, 325 GALLONS PER CAPITA PER DAY.
OUTDOOR USE OF IRRIGATION TOGETHER WITH INDOOR USE THAT ONE PERSON WOULD USE ON ANY GIVEN DAY.
TYPICALLY HIGHER THAN THE NORMAL.
2020 NUMBER GONE DOWN TO 225 GALLONS PER CAPITA PER DAY.
WE BELIEVE IF WE CAN CONTINUE WITH THE CURRENT RATE OF CONSERVATION WE'LL SEE THE NUMBER GO DOWN FURTHER AND FURTHER.
SO AT THE REGIONAL LEVEL OUR CONSERVATION PROGRAM PLAYS A GREAT ROLE.
I WANT TO PAUSE AND SHARE WITH YOU ONE OF THE DRAFT SLIDES PART OF OUR INDIO SUBBASIN SUSTAINABLE MANAGEMENT ACT OBLIGATION.
I'LL COME BACK TO YOU ON THE 15TH FOR AN ACTUAL PRESENTATION AND PUBLIC HEARING FOR ADOPTION OF THIS PLAN.
WHAT DOES THAT MEAN TO INDIO WATER AUTHORITY IT HAS A HUGE COMPONENT OF CONSERVATION WE ARE PART OF THAT PROCESS.
IF YOU LOOK AT THE CHART, BEGINNING IN JANUARY 2010, THAT IS AROUND THE TIME REGIONAL REPLENISHMENT CAME ABOARD WITH THE REGIONAL FACILITIES.
STRONG PUSH TO HAVE GOLF COURSES IRRIGATED WITH CANAL WATER.
[INAUDIBLE] ADDITIONAL MONITORING WELLS STRATEGIC WHEREVER INDIO BELIEVES WE SHOULD BE MONITORING TO PROVIDE A METER OR REGAUGE WHETHER OR NOT THESE
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PROJECTS ARE WORKING.DOWN AT THE BOTTOM I PLACED CONSERVATION.
ONE OF THE BIGGEST REASONS WHY WE ARE NOW SEEING LEVELLY OF THE GROUND WATER BASIN.
NOT ONLY REPLENISHMENT, RETURN FLOWS, CONSERVATION IS KEY.
VARIOUS CHARTS OR THE LINES YOU SEE REPRESENT, CONTINUE TO SEE CONSERVATION REGIONAL REPLENISHMENT, CANAL IRRIGATION.
DIFFERENT SCENARIOS THAT SHOW CONTINUING TO RISE.
LOWEST OF THE TWO, BLUE AND LIGHT BLUE REPRESENT A BASELINE.
NO MORE NEW PROJECTS NO REPLENISH, NO ADDITIONAL CONSERVATION, NO ADDITIONAL USE OF CANAL WATER, WE'LL BEGIN TO SEE NOT ONLY LEVELLING LINE, BUT OVER 30-50 YEARS, MAY BEGIN TO DECLINE.
LIGHT BLUE REPRESENTS CLIMATE CHANGE.
REASON I AM SHARING THIS WITH YOU, WE ARE BIG PROPONENTS OF CONSERVATION.
IF YOU CONTINUE TO DO THIS, THERE IS A PLAN IN PLACE, MODEL IN PLACE SHOWS WE HAVE TREMENDOUS AMOUNT OF WATER OPPORTUNITIES, SUSTAINABILITY OPPORTUNITIES, HENCE IT IS PART OF OUR PORTFOLIO.
I DIDN'T MEAN TO BELABOR THE SLIDE BUT WANTED TO SHOW THERE ARE LONG-TERM BENEFITS.
ALL THE OTHER LINES ABOVE BLUE AND LIGHT BLUE, FOR EXAMPLE, BEGIN TO DO SOME LEVEL OF DIRECTION INJECTION, RECYCLE WATER, EXPAND, CWA, AWA, REPRESENTATIVE EFFECTS ARE THE YELLOW, THE GREENS AND UP TO THE RED LINE.
THAT IS WHAT IS GOING TO HAPPEN ACCORDING TO THE MODEL AND ALL SIX AGENCIES.
WE WILL SEE A TREMENDOUS RISE IN OUR GROUND WATER STORAGE.
NOT TO SEE ANY RISK WITH CANAL WATER GOING AWAY SOME LEVEL OF EXTREME DROUGHT AND SO FORTH.
THERE IS CLIMATE CHANGE COMPONENT THAT SHOWS SOME LEVEL OF REDUCTIONS IN CANAL WATER.
IN THE LONG TERM, HISTORY HAS SHOWN US OVER TIME HYDROLOGY JIS THAT BRING US TO SOME LEVEL OF NORMALITY.
TO SHOW, THESE TWO WELLS ARE IWA WELLS WE PRODUCE.
SINCE 2008 WE HAVE BEEN MONITORING WELL LEVELS.
DIFFERENT TOOLS USED OVER TIME AND GETTING MORE AND MORE SOPHISTICATED.
IT IS SHOWING US WHAT IS HAPPENING IN THE BASIN.
SINCE 2008-2021, WE ARE SHOWING TREND LINES ARE GOING UP.
TWO OF OUR LARGEST PRODUCING WELLS.
WE ARE EXCITING THIS IS WORKING.
THIS IS ALL LEADING UP TO HOW AND WHY WE PREPARED A FINANCE PLAN THAT TAKES INTO ACCOUNT WHAT WE NEED TO REPLACE AND HOW WE ARE DOING WITH THE SUPPLY.
>> WHAT IS ALLOWING THE GROUND WATER CONDITION TO IMPROVE?
>> OVER TIME THE DARK LINE IS OUR GROUND WATER LEVELS GOING DOWN.
EACH OF THOSE ELEMENTS, LITTLE BLUE ARROW REPLENISHMENT, GOLF COURSES, PUMPING LESS WATER FROM THE BASIN.
THERE IS A REDUCTION IN BASIN USAGE.
WE HAVE A TIERED OR BUDGET RATE.
WE HAVE DEMONSTRATED THROUGH OUR PRODUCTION BEING PRODUCED LESS AND LESS.
MORE SPECIFICALLY, TREMENDOUS AMOUNT OF CANAL WATER REPLENISHED INTO THE BASIN.
2010, FOR EXAMPLE, LEVY PLANT CAME ON.
WHAT WE DIDN'T SEE IMMEDIATELY 2010, BENEFITS, DOES TAKE TIME FOR THAT WATER TO TRAVEL.
COMBINATION OF EXTREME CONSERVATION REDUCES OUR PUMPING.
THEN INTRODUCING CANAL WATER AND RETURN FLOWS INTO THE BASIN.
THAT IS ALLOWING US TO RECOVER BASIN LEVELS.
THAT IS THE BASIS OF THIS LONG-TERM SUSTAINABLE PLAN.
LET'S LOOK FOR OPPORTUNITIES TO USE BSD WATER OR OTHER RECYCLED WATER FOR IRRIGATION PURPOSES.
AS MUCH AS WE WANT TO LOOK AT INJECTION, WE WANT TO EXHAUST ANY OTHER COST EFFECTIVE MEASURES.
THAT WAS A LONG WINDED WAY OF ANSWERING YOUR QUESTION.
IT IS A WAY THAT IS HELPING GROUND WATER BASIN TO RISE, IT IS NOT JUST ONE.
THIS IS ONE OF THE FIRST OF TWO SLIDES THAT DEMONSTRATES HEALTH OF OUR OCCURRING RATE STRUCTURE AND HEALTH OF FINANCIAL STANDING AT IWA.
THIS CHART HERE IS THE OUTPUT OF OUR LONG RANGE FINANCE MODEL.
WHAT ARE THE LINE ITEMS? IT IS CONSISTENT WITH THE STAFFING PLAN.
MIGUEL MAKING SURE ENOUGH MONEY IN THERE.
ON AVERAGE INCREASING 3% EACH AND EVERY SINGLE YEAR FOR THAT 10-YEAR WINDOW.
OTHER ITEM, WE HAVE TAKEN 9.4 MILLION DOLLARS PART OF OUR EMERGENCY AND OPERATING RESERVES.
REASON WE DID THAT, VERY HIGH SEISMIC ZONE AREA.
WE ARE NOT A TYPICAL AGENCY THAT CAN RELY ON A SMALLER RESERVE.
IT IS NOT PART OF THIS GRAPHIC.
GREEN LINE REPRESENTS OUR RESERVE BALANCE OUTSIDE OF THAT 9.4 MILLION IN THE EVENT OF AN EMERGENCY.
IF WE IMPLEMENT CIP TOGETHER WITH CONSERVATION PLAN, STAFFING PLAN, OPERATIONS AN SERVICES, WE'LL BEGIN DRAFTING THOSE RESERVES.
IN ADDITION TO THAT, ANNUAL REVENUE WE COLLECT FROM OUR RESIDENTS.
OVER TIME NEW ACCOUNTS, MORE AND MORE RESIDENTS.
ALL OF THAT IS TAKEN INTO ACCOUNT WITH THIS LONG RANGE FINANCE PLAN.
YOU'LL SEE THE GREEN LINE DROP.
LET ME DEFINE WHAT THE BLUE AND RED LINES MEAN.
TYPICALLY 9.4 REPRESENT, WE ARE IN A SEISMIC AREA BEGINNING WITH THE RED LINE IN THE EVENT WE HAVE A LARGE CATASTROPHE, WE WOULD LIKE 25% OF ANNUAL OPERATING COSTS IN THE BANK SO TO SPEAK.
WE HAVE THREE MONTHS WORTH OF EXPENDITURES IN THE EVENT WE CAN'T COLLECT ANYMORE REVENUES FROM OUR RESIDENTS.
THAT IS A TRIGGER FOR US TO MAKE SURE WE ARE ABOVE THAT LINE.
IT IS REALLY A HEALTH CHECK FOR US.
LET'S MAKE SURE WE DON'T DRAFT RESERVES TO THAT LINE.
IN ADDITION TO THAT, WE HAVE A BLUE LINE.
THAT REPRESENTS ADDITIONAL NOT ONLY 25% OF OUR OWN COSTS, ALSO INCLUDES ONE YEAR OF CAPITAL IMPROVEMENT EXPENDITURES.
IN THE MIDDLE OF A CONTRACT WITH CONTRACTORS, WE CAN COMPLETE ONE YEAR'S WORTH OF WORK.
OTHER THING I SHOULD MENTION RED LINE INCLUDES DEBT SERVICE.
OBLIGATIONS FINANCIALLY IN GOOD STANDINGS.
YEAR AFTER YEAR AS WE START DRAFTING CIP, GOAL IS TO SEE WHEN IS THAT GREEN LINE GOING TO CROSS THE HIGHER OF THE TWO? WE WANT TO BE CONSERVATIVE.
TOUCHES THE BLUE LINE INDICATES TO ME, TO THE TEAM WE NEED A RATE
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INCREASE TO KEEP US WHOLE, TO KEEP US BALANCED.SO GIVEN THAT IN THE LAST SINCE 2014-2018 CITY UNDERWENT A 5% RATE INCREASE SORRY, 8% RATE INCREASE FOR FIVE YEARS.
TREMENDOUS AMOUNT OF REVENUE COLLECTED.
SOME OF THE PROJECTS NOT IMPLEMENTED.
REASON WHY YOU ARE SEEING RESERVES AND ANNUAL ACCUMULATION OF REVENUES WAS BECAUSE OF THE RATE INCREASES.
NOW IS A GREAT OPPORTUNITY TO CONTINUE TO IMPLEMENT PROJECTS AS I DEFINED RIGHT NOW.
SEE WHAT THAT DOES OVER THE NEXT 10 YEARS.
YEAR AFTER YEAR, WE SEE WE ARE DRAFTING OUR RESERVE BALANCE.
WE ARE USING THE REVENUES WE ARE COLLECTING AND IMPLEMENTED DOWNTOWN PIPELINES, CONSERVATION, STILL KEEPING UP WITH STAFFING LEVELS.
WHAT THIS SHOWS IS THAT BY 2031, 2032, WE ACTUALLY HAVE ENOUGH RESERVES AND HAVE A STRONG REVENUE STREAM THAT WE HAVE A BALANCED BUDGET.
I CAN'T BELIEVE I JUST SAID THAT.
VERY DIFFICULT TO SEE OVER 10 YEARS WE DEMONSTRATED A BALANCED BUDGET.
WE CAN COME BACK NEXT YEAR HAVE THE SAME PRESENTATION, AND CONTINUE TO EXERCISE THIS MODEL.
CONTINUE TO COME BACK TO YOU FOR FEEDBACK.
I AM GOING TO PAUSE RIGHT THERE.
THIS IS THE FIRST OF TWO MAJOR ELEMENTS.
1, MAY PRESENTATION WOULD END IF WE DIDN'T HAVE CHROMIUM 6 TO TALK ABOUT.
I WILL PAUSE TO HAVE DIALOGUE.
>> ANY QUESTIONS FROM COUNCIL?
>> AFTER YOUR 10 -- GIVEN TRAJECTORY OF THE GRAPH, WILL WE BE IN A BUDGET DEFICIT?
GRAPH ILLUSTRATES WE ARE NOT IN A BUDGET DEFICIT.
I SAY THAT BECAUSE THAT IS THE PURPOSE OF THE GRAPH IF THE GREEN LINE WAS FALLING BELOW BLUE OR RED, THAT WOULD IN{UP}INDICATE CLOSE TO A BUDGET DEFICIT.
WE ARE STILL IN GOOD STANDING.
GIVEN TRAJECTORY OVER 10 YEARS PRIOR, WE WOULD BE IN A BUDGET DEFICIT.
HOWEVER ONE OF THE THINGS I DO NEED TO STATE IN THE EVENT WE DO NOT IMPLEMENT SOME OF THOSE PROJECTS, IN THE EVENT WE HAVE STAFFING AGENCIES.
THAT GREEN LIGHT IS GOING TO RISE OVER TIME.
REAL EFFORT IS WE DEMONSTRATE MINIMUM OVER A LONG 10-YEAR PERIOD WE HAVE A BALANCED BUDGET.
TO YOUR POINT, I WANTED TO MAKE SURE LAST INCREMENT WAS A FLAT LINE INCREMENT.
WHAT I MEAN IS IT IS NOT DROPPING.
IF YOU DO EXTEND OVER THE NEXT 5-10 YEARS, THAT DROP, THE THE ANGLE OF THAT LAST CURVE WILL INDICATE WHERE YOU ARE HEADED.
THE FACT AT THE END OF THE 10 YEARS WE HAVE COMPLETED ALL THE CIP WE HAVE A BALANCED BUDGET.
WE CAN'T IMPLEMENT ADDITIONAL CIP.
GOAL IS TO COME BACK TO YOU EVERY SINGLE YEAR, NOT JUST TODAY.
>> WE NEVER WANT TO HOLD BACK ON CIP PROJECTS IF THE FUNDING IS THERE.
WE ARE CAUTIOUS OF RATE INCREASES TO MAKE SURE WE WRAP THEM UP PRIOR, BACK THEM UP ENOUGH SO WE DON'T END UP IN A DEFICIT AND TRY TO DO A RATE INCREASE.
YEAR 2028 IS WHEN WE WOULD CONSIDER PHASING IN A RATE INCREASE.
>> YOU ARE NEVER GOING TO GET THERE.
LET'S SHOW THEM THE TRUE BASELINE.
SUGGESTING RATE INCREASE MANY YEARS OUT, ABSOLUTELY.
WE CAN SHOW AND DEMONSTRATE WHAT THAT LOOKS LIKE.
CAN WE COME BACK TO YOU WITH AN ALTERNATIVE.
WHAT DOES THAT LOOK LIKE? WHAT DOES THAT FUND?
>> PERSONALLY I WILL BE HERE IN 2028.
I THINK THAT IS THE YEAR YOU SHOULD START PHASING IN A RATE INCREASE.
>> JUST JUMPING IN, COMPLIMENTING THE COUNCIL, THE BOARD, THIS IS GREAT NEWS.
THERE MAY NOT BE EXCEPT FOR THE STATE MANDATES.
WE ARE IN GREAT FINANCIAL SHAPE.
MIGHT CAUSE AND REQUIRE A RATE INCREASE.
RIGHT NOW UNLESS YOU WANTED TO ADD CIP PROJECTS FOR 10 YEARS NOT TO HAVE A RATE INCREASE OR GRADUALLY PHASE IT IN, GREAT NEWS.
WE DID CONTEMPLATE A GAP BETWEEN THE RED AND BLUE LINE.
DEFINITELY COME BACK SHOWING YOU WHAT IT LOOKS LIKE BEFORE WE DO THAT.
I'LL TAKE THE NOTES ANY OTHER QUESTIONS.
WE'LL GET INTO THE RATE IMPACTS THAT CHROMIUM 6 MAY HAVE FOR OUR CITY.
>> I CONCUR WITH COUNCILMEMBER AMITH.
IS THAT INCLUDING, OBVIOUSLY NOT CHROMIUM 6.
LIKE WE DID EXPANSION OVER AFTER OF THE CANAL AREA TO LOOP THE SYSTEM IS THERE ANYTHING LIKE THAT?
ARE WE TAKING >> OPPORTUNITY PROJECTS OR WE TALKED ABOUT LONG-TERM MAINTENANCE, TOO.
>> TAKES ALL THE ABOVE INTO THE INFORMATION.
TAKES INTO ACCOUNT THE LOOPING, REPLACEMENT.
WE PUT EVERYTHING IN THE POT SO TO SPEAK CONFERRED BY MANAGEMENT THEY HAVE AN OBLIGATION TO OVERSEE OPERATION STAFFING.
WE SAW A LITTLE BIT OF A GAP INITIALLY.
IT WAS AN OPPORTUNITY FOR MIGUEL AND I TO SIT DOWN, LOOK, WE DON'T HAVE BACK UP GENERATORS IN OUR SYSTEM.
LET'S PUT IT IN THERE, INCLUDE IT.
THAT IS A CRITICAL ELEMENT TO HAVE A RELIABLE SYSTEM.
WHAT THAT DID IS DROP THE LINE EVEN FURTHER.
WHAT WE DID S AS STAFF, LET'S MAKE SURE WE PUT IT ALL IN THE SPREAD SHEET.
TO YOUR POINT WE ADDED PROJECTS AND JUSTIFIED PROJECTS AS RELIABILITY.
>> INCLUDING WELL REPLACEMENT AND REPLENISHMENTS?
WE HAVE IT AS THE PROGRAM FOR NEXT 10 YEARS.
>> IF WE ARE DOING RATE INCREASES WE NEED TO LOOK AT THE TIERED RATES.
WHAT I HAVE HEARD FROM INDIVIDUALS AND GATED COMMUNITIES, THEY ARE ALREADY IN TIER THREE THEY HAVEN'T DONE ANYTHING DIFFERENT.
YOU HAVE SENIOR CITIZENS AND SENIOR CITIZENS AND ALREADY IN TIER THREE THEY ARE LIKE I AM TAKING A SHOWER.
I AM ONLY WASHING MY CLOTHES NOW I AM BEING PENALIZED.
WE NEED TO LOOK AT THAT IF WE ARE GOING TO RAISE RATES.
IT IS NOT THE FIRST RATE THAT KILLS YA, IT IS THE SECOND AND THIRD ONE.
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SOME HAVE HAD MISTAKES, A LOT OF THEM ARE DOING DAY-TO-DAY STUFF.OUR BUDGET AMOUNT IS NOT ENOUGH TO LIVE A COMMON EXISTENCE.
NOT BEING EXCESSIVE, NOT HAVING A POOL ETC. HIGH RATE BILLS THAT HURT US BUT HELP THEM.
>> WE HAVE SEPARATED OUR FINANCIAL NEEDS FROM A TIERED RATE STRUCTURE.
HOWEVER HAVING A TIERED RATE STRUCTURE SHOULD NOT YIELD ADDITIONAL REVENUE.
GOAL IS TO STILL HAVE THE SAME REVENUE.
HOW WE ALLOCATE OBLIGATIONS AMONG RATE PAYORS THAT WILL BE A SUBJECT MATTER THIS TEAM WILL BRING BACK MARCH, HOPING TO DO IT EARLIER.
A LOT OF THE OF HOMEWORK AHEAD OF US.
OTHER AGENCIES NOW MOVING FROM BUDGET RATES, SOME ARE NOT.
WE WANT TO MAKE SURE WE HAVE A TRUE STORY TO TELL YOU.
GOOD CASE IN POINTS FROM CBWD WESTERN MUNICIPAL.
HOW THEY WERE ABLE TO SUCCESSFULLY DEFEND THEIR CASE AND BRING THAT INFORMATION BACK TO YOU WE ARE THINKING ABOUT MARCH.
LITTLE SEPARATE FROM TODAY'S DISCUSSION.
REALLOCATING RATE STRUCTURE SHOULD NOT YIELD BOTTOM LINE ADDITIONAL REVENUE.
INCREASE APPLIES TO OUR ENTIRE BASELINE.
HOW WE ALLOCATE THOSE TIERS IS HOW WE'LL COME BACK TO YOU.
CONSULTANTS ON OUR ZOOM HELPING US.
THEY HAVE GOOD EXPERIENCES WORKING WITH BEVERLY HILLS, CITY OF L.A.
REALLY IS GOING TO SHARE BACKGROUND INDUSTRY PRACTICES AND WHERE WE ARE HEADED AS AN INDUSTRY.
WE HAVE PROGRAMS THAT HELP SENIORS AND FOLKS THAT ARE HAVING A HARD TIME.
FOLKS DO COME TO US WITH FIXED INCOMES IT IS JUST NOT WATER WASTE.
WE HAVE THESE PROGRAMS, RESOURCE FAIRS ALWAYS GREAT IWA PARTICIPATES.
WE HAVE GIVEN OUT FREE SHOWER HEADS AND EDUCATED OUR PUBLIC HOW TO CONSERVE.
WOULD LIKE TO HIGHLIGHT AS WE MOVE FORWARD.
IT IS THOSE FOLKS ON FIXED INCOMES.
THERE IS REGIONAL COLLABORATION WITH THE SAME GRANT DOLLARS.
MICHELLE OBLIGATION SPECIFIC TO GRANT FUNDING.
IN FACT WE HAVE ONE IN FRONT OF US.
LOOKING AT APPLYING 150,000 HOW DO WE HELP THEM? SCALEABLE, TURNKEY RIGHT TO YOUR POINT.
I AM CONSCIOUS NOW VERSES THE BIGGER LOOK.
I AGREE THE CONSENSUS HERE, NONE OF US WANT TO COME OUT WITH THE HUGE RATE INCREASE.
BUT THAT SMALL SMOOTH BARELY NOTICEABLE INCREASE IMPACTS PEOPLE LESS.
EXCEPT FOR THOSE FOLKS ON FIXED INCOME.
>> THE PROGRAM TO ASSESS LEAKS AND HELP FOLKS IN DETERMINING THAT SO THEY STAY WITHIN THE LOWER TIERS.
TO HAVE THAT FOCUS, UNDERSTAND IF WE CAN CONTINUE TO HAVE IT AT THE LARGE LANDSCAPE LEVEL.
I HOW DO WE ASSESS TO SEE WE GET IT AT THE RESIDENTIAL LEVEL.
EDUCATION, MICHELLE HAS NOW PREPARED SOME FLYERS.
WHAT HAPPENS WHEN YOUR TOILET LEAKS, CLICK ON THIS LINK AND HELP YOU.
A ROBUST APPROACH TO SHARE THAT MORE PICTURE ORIENTED.
THERE ARE SOME SENIORS THAT HAVE MINIMUM WATER USAGE.
THEY FALL INTO THE HIGHER TIER.
CALLING IWA AT THIS POINT IN TIME DOESN'T HELP THEM.
IS THERE ANY MECHANISM FOR SOMEONE IN THIS PREDICAMENT FOR IWA TO TAKE ANOTHER LOOK AT THAT HOME AND WATER USAGE AND APPROPRIATE TIER.
>> I DON'T WANT TO LEAVE MY STAFF OUT ANSWERING THAT QUESTION.
WE HAVE EXPERIENCE TAKING CALLS.
IF THEY ARE AT A VERY HIGH LEVEL OF WATER USAGE.
[INAUDIBLE] TO FIND THE LEAK AND WHATEVER IS NEEDED.
>> THIS IS THE INPUT FEEDBACK.
OPPORTUNITIES IN THE PAST WE HAVE WORKED WITH THE SCHOOL DISTRICTS.
PERHAPS WE CAN COME BACK TO YOU WITH ADDITIONAL ELEMENTS OF OUR OUTREACH PROGRAM PART OF CONSERVATION OUTREACH AND EDUCATION TO VISIT HOA'S, COMMUNITIES THAT NEED EDUCATION MORE OF A ONE ON ONE AND MAKE THAT PART OF OUR PORTFOLIO OF CONSERVATION.
WE'LL SEEK TO SEE WHAT WE CAN DO WITH THAT.
MAJORITY OF THAT IS BECAUSE OF THE WATER REPLENISHMENT WITH CANAL WATER.
WE HAVE SEEN RESTRICTIONS FROM THAT WATER SUPPLY.
WHAT DO WE SEE AND HOW CAN WE PREPARE SHORTAGES FROM THE COLORADO RIVER?
I CAN REFER TO A SLIDE HERE THAT ADDRESSES THAT ON A SHORT TERM.
LET'S POINT IF WE CAN LOOK AT THE LIGHT GREEN LINE MEANING THE ONE, TWO, THREE, FOURTH LINE FROM THE BOTTOM SIMULATES WHAT WE REFER TO AS CLIMATE CHANGE.
STATING WE HAVE A REDUCED CANAL WATER.
IN ADDITION INCREASED CONSERVATION.
SIX LEVELS WE AE APPROVED IN JULY.
TO ATTEMPT TO ANSWER YOUR QUESTION, WE HAVE A MECHANISM IN PLACE THAT REQUIRES COUNCIL RESOLUTION AND ADOPTION TO GO FROM LEVEL, TWO, THREE, FOUR, VERY HARSH WE MAY NOT ALLOW ANY OUTDOOR WATER USE ON THE EXTREME SIDE OF THAT PROGRAM.
MAY LAST FOR WEEKS, FOR MONTHS, EVEN A COUPLE OF YEARS UP UNTIL WE GET THAT RAIN AND HYDROLOGY TO BRING US BACK.
THAT IS A LONG-TERM REGIONAL MODEL.
TOGETHER WITH CONSERVATION AND SIX-ACTION PLAN.
I'LL PAUSE THERE TO MAKE SURE I FULLY ADDRESS YOUR QUESTION HERE.
I THINK ON MY END, I THINK WE SHOULD START GETTING READY FOR THAT EARLIER THAN LATER.
I DO UNDERSTAND DIFFERENCE HERE WE HAVE THE PLANS IN PLACE.
WORKING WITH OTHER ORGANIZATIONS THAT WILL BE GREAT.
I KNOW WE ARE DOING A GREAT JOB ON CONSERVATION SIDE.
WE NEED TO KEEP GOING AND MAKE SURE WE ARE READY FOR THE SHORTAGES MOST LIKELY.
I KNOW YOU HAVE TAKEN A LOT OF TIME WITH US, I AM CONSCIOUS OF YOUR TIME.
>> NOW WE'LL GET INTO CHROMIUM 6.
JUST BEFORE WE DO THAT, INITIAL RECOMMENDATION.
WE HAVE A BALANCED 10-YEAR BUDGET TO GET US IN GOOD STANDING LONG TERM WE CAN CONTINUE TO IMPLEMENT CIP ON SHORT-TERM BASIS.
DEMONSTRATED THAT THROUGH THE FINANCE PLAN.
WE CAN PROVIDE MID YEAR UPDATE TO SHARE THAT SAME GRAPHIC.
SEE WHAT IT LOOKS LIKE EACH YEAR.
CHROMIUM 6 MAXIMUM CONTAMINANT LEVEL IS A STATE MANDATE.
BACK IN 2016, STATE SET MCL 10 PARTS PER BILLION.
THREE OF THOSE WELLS, WE WERE ABLE TO BUILD A TREATMENT FACILITY.
WE HAVE BEEN OPERATING IT SINCE THEN.
IN 2017, MCL INVALIDATED BY SUPERIOR COURT.
BASIS WAS A LOT OF AGENCY NO ECONOMIC FEASIBILITY STUDY CONDUCTED TO ANTICIPATE SINCE THEN JUST LAST MONTH ALL RECEIVED A LETTER FROM THE STATE WATER BOARD NOW CONSIDERING 17 POSSIBLE CONTAMINANT LEVELS.
EITHER 1-15 OR 20 OR 25 PARTS PER BILLION.
THAT IS THE 17 POTENTIAL ACTIONS THEY CAN TAKE.
THEY HAVE A COMMENT PERIOD THROUGH DECEMBER 6, 2021.
ENVIRONMENTAL IMPACT REPORT ON HOW THE TREATMENT OF THESE DIFFERENT LEVELS.
[00:30:02]
WHAT THAT TREATMENT PLANT, WHAT IMPACT ON THE ENVIRONMENT.ALL THE AGENCIES CAN USE PROGRAMMATIC.
I BROKE THIS DOWN RELATIVE TO OUR EFFECT OF ALL 20 WELLS.
LET'S WALK THROUGH THIS SLIDE.
LOWEST LEVEL ONE THROUGH SEVEN PARTS PER BILLION.
BASED ON 2020 STATE WATER BOARD TREATMENT COST ESTIMATE TABLE THEY PREPARE.
WHAT WE ANTICIPATE TREATMENT CAPITAL 85 MILLION FOR RESIDENTS.
ANNUAL COST FOR OPERATING, IT IS THE TRUCKING OF THE WASTE PRODUCT.
EXTREMELY EXPENSIVE TO CHUCK THE WASTE PRODUCT.
ANY ADDITIONAL STAFFING TO ATTEND TO ALL 17 WELLS WILL ADD STAFFING CHALLENGES.
IN THE EVENT SAME MCL AS 2015, WE WANTED TO DEMONSTRATE 35 MILLION DOLLARS IN CAPITAL, 4 MILLION IN OPERATIONS.
EFFECT ADDITIONAL 7 WELLS MAYBE MORE WATER QUALITIES OF THOSE WELLS.
WE ARE HOPING STATE WILL CONSIDER MCL CLOSER TO 12-15 IF NOT 20-25.
THERE IS HOPE THAT CAN HAPPEN.
A LOT OF AGENCIES GETTING TOGETHER AT THE REGIONAL LEVEL.
I HAVE BEEN IN TALKS WITH CBWD.
MAKING SURE OUR VOICE IS CONSISTENT.
MESSAGE IS FIRST OF ALL WHY SO EXTREME? BECAUSE THE STATE, FEDERAL LEVEL IS 50.
THEY ARE GOING WAY BELOW THE FEDERAL LEVEL.
OUR THOUGHTS ARE WE SHOULD FALL SOME WHERE THAT IS REASONABLE.
WE'LL COME BACK TO YOU WHEN IT IS THE APPROPRIATE TIME TO COMMENT WITH RESPECT TO MCL.
WHAT DOES THAT MEAN TO OUR RESIDENTS? WE FAMILIAR -- WE ARE A LITTLE FAMILIAR WITH THE SLIDE.
THE LINE IS THE DOTTED GREEN LINE.
PRIOR SLIDE HIDING UNDERNEATH BECAUSE NO RATE INCREASES.
5 AND A HALF RATE INCREASE OVER 4 YEARS NET IMPACT TO OUR RESIDENTS.
INCLUDES ALL THE NUMBERS DEMONSTRATED WITH THE FIRST CHART.
IF WE DO NOTHING, DOTTED GREEN LONG WILL BE EXHAUSTED BY 2027 '28.
WITH RESPECT TO RATE INCREASES WE BEGAN TO DEMONSTRATE RATE INCREASE REQUIREMENTS AS EARLY AS NEXT YEAR.
WE CAN PUT IN 2, 3, 4, 5 PERCENT.
WHAT I TRIED AT LEAST FOR ILLUSTRATION PURPOSES.
FIVE AND A HALF PERCENT FOR FOUR YEARS, ON A 10-YEAR BASIS WILL KEEP US ABOVE THE GREEN LINE.
THAT ASSUMES WE WOULD BOUGHT FUN FOR THE CAPITAL WE NEED TO INVEST THE MONEY.
STATE MAY OFFER GRANT SO SEVERE, SO EXTREME MCL.
IN THIS ILLUSTRATION WE DID INCLUDE IT.
I'LL PAUSE THERE FOR SOME COMMENT.
>> REY, IS THIS ASSUMING WHICH PARTS PER BILLION COMES INTO PLAY?
>> ASSUMES MID RANGE FROM PRIOR SLIDE ASSUMES 8-11.
WHICH IS THE 35 MILLION IN CAPITAL.
IF IT GETS WORSE THEN THAT, AT LEAST WE UNDERSTAND WHAT THE IMPACT IS.
REASON I BROKE THIS UP INTO TWO DIFFERENT CHARTS.
1 BALANCE BUDGET MEANING TO RATE IMPACTS WAS THE INTEN HERE.
CLEARLY IT IS AN EFFECT THAT AS YOU STATED EFFECTS OUR BUDGET AND REQUIRES RATE INCREASE.
>> APOLOGIZE FOR THE LENGTH OF THE PRESENTATION.
I WANT TO MAKE SURE WE HAVE THE RIGHT PRESENTATION.
RECOMMENDATIONS AS WE CONTINUE TO PRESENT FINANCE OPTIONS ONCE IT IS ADOPTED.
WE'LL BE COMING TO YOU FREQUENTLY AS SOON AS WE HEARING ANYTHING ON THE MCL.
FOCUSSED ON OPERATING AND CAPITAL LONG RANGE FINANCE PLAN.
ALSO TALK ABOUT STATE MANDATE AND FINANCE PLAN SPECIFICALLY RECOMMENDATIONS FOR OPERATION CAPITAL.
WE'LL COME BACK AND WORK WITH THE INPUT.
STATE MANDATE REPORTING BACK EARLY NEXT YEAR.
PRELIMINARY ANALYSIS, 5 AND A HALF PERCENT RATE INCREASE.
WITH RESPECT TO SUPPLEMENTAL WATER SUPPLY, IT IS A PROJECT PART OF OUR PORTFOLIO.
WE WOULD HAVE TO GO BACK AND UPDATE 2013 WE NEED TO GET OUR HANDS AROUND THE STUDIES.
FACT THAT THERE IS POTENTIAL CHROMIUM 6 MAY CONSUME.
IS DEVELOPER IMPACT FEE ADOPTED RECENTLY.
THAT IS THE SUMMARY OF OUR DISCUSSIONS AND OPEN IT UP TO THE BOARD.
>> OKAY RUNNING FEW MINUTES LATE.
ANY FINAL COMMENTS OTHER THAN WHAT AN EXCEPTIONAL JOB THINGS TO CONSIDER?
[00:35:02]
ANY COMMENTS? I THINK WE ARE GOOD.WE LOOK FORWARD TO UNDERSTANDING WHAT THOSE RANGES COME BACK IN MID 2022.
>> OKAY ON THAT NOTE, LADIES AND GENTLEMEN, MEMBERS OF THE AUDIENCE.
I WOULD LIKE TO OPEN CLOSED SESSION THREE MINUTES AFTER 4:00 P.M.
>> FOR THE RECORD ALL THE COUNCIL MEMBERS ARE PRESENT.
>> PUBLIC COMMENT DO WE HAVE ANY PUBLIC COMMENTS?
>> I WOULD LIKE TO ADJOURN TO CLOSED SESSION TO CONSIDER 3.1-3.4.
WE SHALL NOW ADJOURN TO CLOSED SESSION.
* This transcript was compiled from uncorrected Closed Captioning.