Budget Message, FY 1975-1976 TIGARD WATER DISTRICT
BUDGET MESSAGE, FY 1975-76
May 13, 1975
As recommended in the last audit report, the Tigard Water District
will change its accounting and budgetary method from a cash basis to an
accrual basis for all revenues (except property taxes) and expenses.
Depreciation will be computed on fixed assets for accounting purposes,
however, capital outlay acquisitions appear as expenditures in this
budget document to comply with the provisions of O.R.S. 294. The
change from the cash to the accrual basis of accounting results in the
following differences in this budget documents
General_ Fund: Cash Basis Accrual Basis
Beginning Fund Balance 100 $ 50,000
Net Unappropriated Ending
Fund Balance -0- 50,000
Bonded Debt Requirements
Matured but unredeemed coupons 9 500 -0-
All existing funds and account groups, except Bond Sinking Fund,
will be combined into a single enterprise fund (General Fund). This
action will eliminate special funds, such as "Developers" and "Capital
Projects Reserve". Furthermore, the district will consolidate all
checking accounts into two checking accounts, as follows: General
Fund and Bond Sinking Fund.
The financial policies of the water district will remain the same
as in past years. The district must be solvent and abide by the proposed
budget document. Charges for water service have been distributed equitably
and are considered fair and reasonable. While the majority of the revenue
is derived from the consumer in water sales (71%), income is also generated
from new meter installations (13,$), and developers (8%).
It is believed that those residents who benefit from the water system,
but are not connected to the system, should pay some portion of the bonded
indebtedness of the district. These persons may benefit from a fire hydrant
in close proximity, low fire insurance rates, etc. Their contribution is in
the form of property taxes collected by Washington County for Tigard Water
District. With an estimated increase in assessed valuation of 20% the
district will realize about $79,600 in ad valorem taxes which accounts for
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FY ?975-76 Budget Message (Continued)
approximately 1/3 of the principal and interest on bonded indebtedness.
The tax rate remains the same at 34¢ per $1,000 valuation. The out-
standing debt will be reduced from $1,481,000 to $1,386,000 on July 1,
1976. No additional bond issues or indebtedness are planned during
the next fiscal year.
A consumer rate increase of about 25%, effective April 22, 1975,
was deemed necessary to offset the higher cost of wholesale water
charged by the City of Lake Oswego. These higher water costs by
78% result in an annual increase from $85,100 to $160,500 which is
56% of the entire Material & Services Account.
Generally, a 10% cost-of-living increase in pay has been approved
for all employees. Additionally,a draftsman will be hired on April 1,
1976.
In the Capital Outlay Account, provisions have been made for an
addition (upstairs) to the present administration office building.
($15,000). This additional space will provide an office for the Admin-
istrator and a large meeting and hearing room for the Board of Commis-
sioners. Major equipment consists of a new pumping station at the Hi
Tor reservoir site, capable of providing adequate pressure to 500
homes. ($36,000). This will be the last pumping station to be purchased
in the foreseeable future.
After expending substantial sums in past years on pipe line replace-
ments, the end is in sight for this account. Within 4 years all steel
pipe lines will have been replaced with either cast or ductile iron pipe,
adequately sized. Some cast iron pipe has been known to last for as long
as 100 years. This program can be terminated with the following expendi-
tures:
Year Amount
1975-76 $ 80,200
1976-77 99,560
1977-78 84,800
1978-79 78,500
The proposed budget document accomplishes the desired goals and is
fiscally responsible. Superior service can be continued to the customers
with the lowest rates in Washington County of those water purveyors who
must import water.
Don W. Thomas
Budget Officer
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