Oak Lodge Sanitary District FY Budget OLSD Budget Committee Preliminary Budget Meeting April 21,

Preliminary Budget Committee Meeting AGENDA – Budget Calendar – Present proposed budget Budget Message Budget Highlights Rates Debt Service Capital Improvement Program – Sanitary Sewer System – Surface Water Management – Budget Committee Discussion – Next Steps 2

Budget Calendar Budget Committee Orientation1/28/16 Budget Committee Workshop3/28/16 Preliminary Budget Committee Meeting4/21/16 Budget Committee Meeting5/10/16 Budget Hearing by Board6/14/16 Board Approval of Budget & Rates6/14/16 FY17 and New Rates Effective7/01/16 3

FY 17 Proposed Budget Budget Book – Fund Accounts: 100-XXX-XXXX General Fund Accounts 200-XXX-XXXX SSS Capital Fund Accounts XXXX SDC Fund Accounts XXXX State Debt Service Accounts XXXX GO Bond Debt Service Accounts 300-XXX-XXXX SWM Capital Fund Accounts 4

FY 17 Proposed Budget Budget Book – Fund Accounts: XXXX Administration General Fund Accounts XXXX SSS General Fund Accounts XXXX SWM General Fund Accounts XXXX Administration SSS CIF Accounts XXXX SSS CIF Accounts XXXX Administration SWM CIF Accounts XXXX SWM CIF Accounts 5

FY 17 Budget Book Tab 1 - Budget Message: Executive Summary Environmental & Regulatory Issues Capital Finance Issues Debt Financing Budget Overview Financial Management Revenue Capacity and Customer Information Budget Highlights Summation 6

FY 17 Budget Book Tab 2 – Resolutions, Public Notice, Forms: Resolutions to Adopt & Appropriate Public Notices Forms: – LB-1 Notice of Budget Hearing (Published) – LB-4 Financial Summary - Requirements – LB-20 Resources – LB-30 Requirements Summary – LB-31 Detailed Requirements – LB-40 Personnel Services Summary – LB-10 Special Fund Resources & Requirements – LB-35 Bonded Debt Resources and Requirements 7

FY 17 Budget Book Tab 3 – Historical Financial Data & Proposed Actual/ 5-year historical budget by line item FY17 proposed Tab 4 – General Fund Account Detail Resources Requirements Tab 5 – SSS Capital Improvement Fund Resources Requirements 8

FY 17 Budget Book Tab 6 – SSS System Development Charge Resources Expenditures Tab 7 – SSS Debt Service – State Loans Resources Expenditures Tab 8 – SSS Debt Service – GO Bond Resources Expenditures 9

FY 17 Budget Book Tab 9 – SWM Capital Improvement Fund Resources Expenditures Tab 10 – Oregon Local Budgeting Manual 10

11 General Fund Resources Sanitary Sewer Program  Fund Balance (Carryover)= $1,588,124  Operating Income (Rates)= $7,603,265  Non-operating Income = $ 2,938  Sundry Revenues= $ 32,711  Total SSS Resources= $ 9,237,868 SSS Budget is based on 3.29% rate revenue increase  Rate Revenue over FY16 = $ 242,412

12 General Fund Resources Sanitary Sewer Rate Changes: Fixed/Variable Split – Debt Service is in Fixed portion of rate – All other expenses split 60% Fixed/40% Variable – Budget base average water consumption = 5.56 ccf/month – FY17 split = 77.1% Fixed/22.9% Variable – Fixed = $36.62/month ($36.10 in FY16) % – Variable = $1.96/ccf/month ($1.76/ccf in FY16) % Impacts: Average residential customers use 6.0 ccf/month – FY17 = $48.38 FY16 = $46.66 – Rate increase for them = $1.72/month or 3.69%

13 General Fund Resources Surface Water Program  Fund Balance (Carryover)= $ 407,314  Operating Income (Rates)= $1,298,914  Sundry Revenue= $ 23,294  Non-operating Income = $ 5,225  Total SWM Resource= $1,758,141 $.75 Rate Increase for SWM  Rate revenue over FY 16=$ 113,468

14 Rate Revenue Sanitary Sewer Program (Budget Base) – 13,349 Budgeted Equivalent Dwelling Units (EDU) in FY16 – $43.65 Budgeted Average Monthly Rate per EDU in FY16 – $7,360,853 SSS Budgeted Rate Revenue in FY16 – 13,349 Budgeted EDU in FY17 – $47.46 Budgeted Monthly Revenue per EDU in FY17 If we had a flat rate, it would be $47.46 per EDU – $7,603,265 Budgeted Rate Revenue in FY17

Sanitary Rates Based on 6.0 ccf 15

Customer CCF Profile 16

17 Rate Revenue Surface Water Program – 13,516 Budgeted ESU in FY16 – $7.25 Budgeted Monthly Fee per ESU – $1,137,017 Budgeted SWM Fee Revenue in FY16 – 13,529 Budgeted ESU in FY17 – $1,298,914 Budgeted SWM Fee Revenue in FY17 Total Rate Revenue – $8,902,179 from Sanitary Sewer and SWM Rates Includes Rate Penalties – Past Due fees; NSF fees; Certification fees 6 ccf Customer will pay $56.38/month SSS+SWM 6 ccf Customer will pay $2.47 more/month SSS+SWM 6 ccf Customer will pay $29.64 more/year

Bi-Monthly Bill Profile SSS + SWM 18 CCF/MthFY16FY17% Increase 3.0$ 97.26$ % 4.0$100.78$ % 5.0$104.30$ % 6.0$107.82$ % 7.0$111.34$ % 8.0$114.86$ %

19 General Fund Expenditures Personnel Services  2.75% increase in budget  2.0% COLA per Labor Agreement  Pay Step increases  PERS costs went up slightly  Medical/Dental/Disability costs are up 4.6% Materials & Services  9.0% increase in budget (+$173K to $2.09M)

Capital Improvement Program Capital Outlay SSS  % increase SSS (+$173,034K to $1.23M) Capital Outlay SWM  44.26% decrease SWM (-$748K to $942K) 20

21 Budget Committee Meeting Questions

Debt Service Coverage Coverage: (DEQ wants 105%) – Income minus expenses $ 10,974,772 Revenue $5,081,600 Expenses $3, Net Income $3,502,957 Debt Service Net Revenue is 104% of Debt Service – Only if 100% of budget is spent – If expenditures are normal & contingency is not spent Net Revenue will exceed 105% of Debt Service DEQ requires us to build capital reserves 22

Debt Service WRF Financing - $51 million: – $24 million GO Bond – $ 8 million IFA Loan – $14 million CWSRF – $ 5 million CWSRF (Interest free) FY16 Debt Service $1,715,550 GO Bond $ 529,848 IFA – (After IRS $138,268 Subsidy) $1,260,230 CWSRF $3,505,628 Total (After subsidy) 23

24 Budget Comments FY16 SSS Program – Fine tuning of WRF to improve efficiency Focus on solids treatment & handling – Meet Requirements of new NPDES Permit Studies: – Mixing Zone Study – Effluent Characterization – Continue sewer cleaning and evaluation as a major element of Asset Management Program – Digester Refit the only major capital work

25 Budget Comments FY16 SWM Program – Focusing on implementation of the Watershed Strategic Plan – Meet 2012 MS4 Permit Requirements – Continue Boardman Watershed Initiative Boardman Wetland Complex Walta Vista, River Road, Naef Road Bridges – Better tracking and allocation of budgeted resources to the SWM program