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05/13/1996 - Budget Minutes Q r TIGARD WATER DISTRICT BUDGET COMMITTEE MEETING MAY 13, 1996 MEMBERS PRESENT: Lou Anne Mortensen, John Haunsperger, Norm Penner, Beverly Froude, John Volpe, Linda Johnson, STAFF PRESENT: Wayne Lowry, Mike Miller, Diane Kuhn VISITORS: Paul Johnson The Tigard Water District Budget Committee meeting was called to order at 6:25 p.m. Vice Chairperson, Beverly Froude introduced the 1996-97 budget discussion. Commissioner Froude turned the meeting over to Wayne Lowry. Mr. Lowry stated that the Budget Committee is made up of the board of the governing body, and five citizen members. In the case of Tigard Water District, the five citizen members are made up of people who live in the unincorporated area who are eligible to vote on measures in that area. The five board members make up the other side of the committee. The decision is a joint decision weather to approve the budget or not. The Budget Committee has two purposes: (1) to decide how much tax to levy. Once that amount is set, the Board can't increase the amount, unless they go through another process. (2) review the budget, make the addendums to it, and recommending it to the Water Board for final adoption. The meeting the Board will have on June 24, 1996, is a public hearing. The budget itself is an estimate of revenues that this local government intends to, or expects to; receive from resource, during the year. We are setting up the legal authority to spend the public funds. Appropriation, means the legal spending limit that this committee will be recommending to the Tigard Water District Board. The board has the authority of making changes up to ten percent in any fund, but there is only one fund. The last two years, the Tigard Water District Budget included a tax levy for the unincorporated area citizen's share of the 1975 Tigard Water District tax supported bonds. Those bonds have since been paid off. Therefore, the district doesn't have to levy any taxes. It no longer has the authority to, because it's bonds have matured. Last year there was a General Fund, and a Dept. Service Fund. This year, the Dept. Service Fund is zero, since it was for paying bonded indebtedness. Any future revenues that may come in from delinquent tax collections, will be directed into the General Fund, the only fund left. General Fund: The largest piece of revenue or resource the Board has is left over from the original withdrawal from the district of the three cities. In Intergovernmental Agreement, Tigard Water District was given $30,000.00. On July 1, 1996 the beginning fund balance will be about $20,000.00. Also in the Intergovernmental Agreement, each of Tigard Water District Budget Committee - 5/13/96 the cities is entitled to, 1% of the water sales. The City of Tigard has waived its rights to these funds. The City of Durham, City of King City, and the Tigard Water District will receive a payment from the City of Tigard out of the Water Fund each year at 1% of the previous years water sales. This is the main revenue source for the District. The other source of revenue is from interest. All city funds are invested, and much of the City investments are in the state pool. We have calculated that $1800.00 will be the interest earnings. $30,000.00 is what can be spent during this next fiscal year. Wayne Lowry asked for questions at this time. The Tigard Water District is set up in a separate fund, to isolate it except for investment purposes. Expenditures: The one significant change is the Boundary Commission dues. The Boundary Commission has finally realized that the Tigard Water District is a much smaller entity than it used to be. Population is the determining factor for deciding how much each participating entity of the Boundary Commission has to pay. They used to view the District as it was prior to the 1994 withdrawal of the Cities. Commissioner Froude asked Mr. Lowry when this was decided? Mr. Lowry stated that in 1995-96 we were only billed for over $700.00 by the Boundary Commission. $3400.00 was budgeted. That is why the estimate has been lowered to $800.00. Beverly Froude stated that there is a move afoot to abolish the Boundary Commission. She asked if this were to happen, are you saying there would no longer be fees? Wayne stated that possibly Metro would then charge. Mr. Lowry stated that there is an allotment for an attorney, election costs; meeting notices; and public relations, none of which have been spent. In the Boards discussions last year, the District wanted to provide for fliers, and publications. The money is there in case the board decides something needs to be done. Contingency are funds that the Board can get to in an emergency, or unforeseen event, by passing a resolution. By passing the resolution, the Board can appropriate up to 15% of a fund out of the contingency account. In order for the Board to spend funds from the contingency account, they would need to designate it for something specific and pass a resolution that moves it out of contingency in to another category in order to spend it. Wayne stated that these are just estimates, and the Board is welcome to change the numbers if they so wish. Keep in mind that your goal is to make sure that you provide the Board with the appropriations necessary for them to carry out their duties. Mr. Lowry again asked if there were any questions. Mr. Volpe asked if the actual expenditures this past fiscal year were $12,472.00? Subtract from that the $3,000.00 for the Boundary Commission dues, then our actual expenses are $9,400.00, which is equal to our actual income for this year. Mr. Volpe feels that we only need to budget $10,000.00. His question is why do we budget $21,000.00? He feels that if we continue to budget $21,000.00, and only need to budget $10,000.00, soon_our reserves will be eaten up. Mr. Lowry stated that he agreed with Mr. Volpe. Mr. Lowry stated that the $12,000.00 actual expenditure was your first year of operation, fiscal year Tigard Water District Budget Committee - 5/13/96 1994-95. Mr. Lowry stated that if the Board wants to budget for current spending levels he felt possibly $12,000.00-$15,000.00 would be adequate. The only thing is that if you don't budget the full $21,000.00, you won't be able to get at it. Mr. Volpe stated that he had no desire to change, but wanted to see what Mr. Lowry's position was on it. Commissioner Haunsperger stated that the reason for starting out with a large fund was that their revenue is limited to the 1% from water sales. Paul Johnson asked if the board could designate monies to go into the Contingency Fund? Wayne Lowry stated that they have already estimated in the beginning balance that the board is going to under expend. Commissioner Penner stated that having several years of budget history would be better in estimating a budget. But since we only have a limited amount of history, he feels it might be better to go with a flexible budget. Mr. Lowry said it's layed out in a way that the Board could get to every dollar of resource. Commissioner Penner felt that in the future, they may be in a better position to allocate some funds into a Reserve Fund. Wayne explained to the Board that another thing that could be done, is to project a five year plan called a Comprehensive Long Term Plan, like the City of Tigard has. Mr. Lowry stated that if the Board is interested, he could work out a plan. Mr. Volpe was concerned about Mr. Lowrys time in doing so, but Wayne said it would only take a few hours of time. Commissioner Volpe stated that he would like to see it. Mr. Lowry stated that if the Board is interested, at the next board meeting, that they make the request and • get it in the minutes, so Wayne may provide the Board with the information. Linda Johnson asked how last years actual income compare to the budgets projection? Mr. Lowry stated that the water sales figure is computed once a year based on the previous fiscal year. The water is projected for a complete year, but the interest is only for a ten month period. Rod Kvistad asked what a projected tax rate per 1,000 if this budget were adopted? Mr. Lowry stated zero. The only tax was Dept. Service, and that is gone. Rod asked if the whole budget was coming out of income. Wayne said yes. Commissioner Froude asked if there is a water rate increase, will that change the proposed 1%? Mr. Lowry said it would change it if the water sales goes up, but Wayne didn't feel there would be a rate increase. Even if it did go up, it would only change by $200.00. Commissioner Mortensen, commented if annexation comes into effect, you would be taking away from the district. Mr. Lowry stated that if there was a lot of growth in the unincorporated area, from new development. New customers add to your revenue base. But annexations will chip it away. John Volpe made a motion to accept the budget as proposed. The motion was seconded by John Haunsperger, and passed unanimously. Tigard Water District Budget Committee - 5/13/96 Chairperson Norm Penner thanked the Budget Committee members for attending. Rob Kvistad asked about public relations. He was questioning why there can't be an article in the CityScape as to what Tigard Water District is, where the monies are, what services might be provided to the population. Due to the fact that the CityScape does not go to all the people in the unincorporated area, Mr. Penner asked if a mailing list could be requested for the addresses in the unincorporated area? Mr. Volpe stated that it's a good idea to let people know where their water comes from. Mr. Haunsperger stated that keeping people informed has always been a problem in the past. Linda Johnson stated that with the projection, if you see troubles on the horizon, it might be a good thing to let people know. Wayne Lowry stated that the budget that was approved tonight does not provide water to anyone. It is for.the Board. Water service to the customers in the area is managed through the City of Tigard Water Department. Chairperson Penner stated that we need to be cautious as to how we represent this boards functions and powers it may or may not have. People can misinterpret. Mr. Lowry stated that if information was to go only to the unincorporated area, the water bills could be used to do so. John Haunsperger stated that it was a good reminder, as these are things that have been discussed in the past, but have not carried forth. The Tigard Water District Budget meeting for 1996 was adjourned at 6:45 p.m. Tigard Water District Budget Committee - 5/13/96 • • • TIGARD WATER DISTRICT INCOME STATEMENT & BALANCE SHEET As of April 30, 1996 INCOME STATEMENT Accounts FY BUDGET Prior Y-T-D I Monthly I V-T-D REVENUES 1%PY Water Sales Revenue 7,700.00 7,777.46 7,777.46 Interest Earned 1,500.00 1,234.80 127.18 1,361.98 Recovered Expenditures Total Revenues 9,200.00 9,012.26 127.18 9,139.44 EXPENDITURES Professional Services 4,800.00 49.50 49.50 Contractual Services 7,800.00 1,697.60 2,027.98 3,725.58 Special Department Expense 4,500.00 Office Supplies&Expenses Advertising&Elections 600.00 Dues& Subscriptions 3,500.00 896.00 896.00 Travel Food&Lodging 650.00 Education&Training 400.00 Insurance 2,600.00 1,804.00 1,804.00 Contingency/Reserve 8,350.00 Total Expenditures 33,200.00 4,447.10 2,027.98 6,475.08 BALANCE SHEET ASSETS Cash& Investments 31,774.22 (1,900.80) 29,873.42 Net Fixed Assets Total Assets 31,774.22 (1,900.80) 29,873.42 LIABILITIES & FUND BALANCE Liabilities Accounts Payable Due Other Funds Total Liabilities Fund Balance Fund Balance 24,000.00 27,209.06 27,209.06 Excess of Rev1(Exp.) (24,000.00) 4,565.16 (1,900.80) 2,664.36 Total Fund Balance 31,774.22 (1,900.80) 29,873.42 Total Liabilities and Fund Balance 31,774.22 (1,900.80) 29,873.42 g:\Excel\TWD\Mont ly\94-5isbs.xls TIGARD WATER DISTRICT INCOME STATEMENT& BALANCE SHEET As of March 31, 1996 INCOME STATEMENT Accounts FY BUDGET I Prior Y-T-D I I Monthly I I Y-T- D I REVENUES 1%PY Water Sales Revenue 7,700.00 7,77.46 7,777.46 Interest Earned 1,500.00 1.' '. 122.49 1,234.80 Recovered Expenditures Total Revenues 9,200.00 122.49 9,012.26 EXPENDITURES9Y11\ Professional Services 4,800.Or i 49.50 Contractual Services 7,80e 1,697.60 Special Department Expenses 4,500.0 . . Office Supplies &Expenses Advertising&Elections 600.00 Dues&Subscriptions 3,500.00 j.00 896.00 Travel Food&Lodging 650.00 Education&Training 400.00 Insurance 2,600.00 1,804.00 1,804.00 Contingency/Reserve 8,350.00 Total Expenditures 33,200.00 4,447.10 4,447.10 BALANCE SHEET ASSETS Cash&Investments 31,651.73 122.49 31,774.22 Net Fixed Assets Total Assets 31,651.73 122.49 31,774.22 LIABILITIES & FUND BALANCE Liabilities Accounts Payable Due Other Funds Total Liabilities Fund Balance Fund Balance 24,000.00 27,209.06 27,209.06 Excess of Revenues/(Expenditures) (24,000.00) 4,442.67 122.49 4,565.16 Total Fund Balance 31,651.73 122.49 31,774.22 Total Liabilities and Fund Balance 31,651.73 122.49 31,774.22 g:\ExceI'TWEAMonthly\94-5isbs.xls