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SR 01-08-2019 9A City Council Report City Council Meeting: January 8, 2019 Agenda Item: 9.A 1 of 11 To: Mayor and City Council From: Susan Cline, Director, Public Works, Water Resources Subject: 2019 Water Rate Adjustment Recommended Action Staff recommends that the City Council authorize a 9% water rate increase to go into effect on January 1, 2019. Executive Summary The City of Santa Monica serves as the water utility for residents, businesses and other utility customers within the city. On February 24, 2015, after consideration of a rate study, Council approved a series of five annual water rate increases for the period of March 1, 2015, through December 31, 2019, not to exceed 9% per year. After implementing a 9% increase for 2015, Council suspended a portion of the annual rate adjustments from 9% to 5% for calendar years 2016, 2017, and 2018. On November 27, 2018, Council approved an updated Sustainable Water Master Plan to achieve the City’s goal of water self-sufficiency by 2023 along with dedicating $64.1 million in pollution settlement funds for Olympic Sub-basin Restoration. Staff is conscious of the adverse impact of increasing water costs on residential and business customers, although our water rates continue to be on the lower end of Southern California water agencies and significantly lower than other nearby agencies, including Los Angeles, Beverly Hills and Culver City. Ultimately, however, maintaining safe and reliable drinking water supply is not only essential, but investment now in that system will be less expensive in the long run than deferring maintenance and continuing to rely on imported water supplies. Central to this long-range strategy is the Council’s commitment to achieve water self- sufficiency through increased conservation and more efficient use of local water 2 of 11 sources. The Council’s reaffirmation of that policy when it approved the Sustainable Water Master in November of 2018 is the basis for this year’s rate adjustment recommendation. Based on the rate increases previously approved in the 2015 study, and the City’s updated plan to achieve water self-sufficiency, staff recommends the City Council implement a full 9% water rate increase previously approved for calendar year 2019, effective on water bills issued on or about March 1, 2019. This would result in a monthly increase of $4.33 to the average single-family home customer. The rate increase would primarily help fund critical water self-sufficiency and resiliency projects, including 1) preliminary design of water treatment plant capacity and efficiency improvements, 2) purchase of a new groundwater well, and 3) annual water main replacements to maintain a 100-year replacement cycle. This recommendation, if approved, will allow the City’s water utility to:  Maintain safe and reliable water deliveries for Santa Monica customers at a reasonable cost while meeting federal and state regulations and City water usage restrictions;  Stay on track to achieve water self-sufficiency by 2023 to reduce reliance on imported water by immediately implementing some of the water self-sufficiency projects approved by Council on November 27, 2018;  Improve environmental sustainability by making more efficient use of groundwater resources and reduce energy costs and greenhouse gases generated from transporting imported water to Santa Monica;  Insulate ratepayers from Metropolitan Water District imported water cost increases including those related to the $17 billion California WaterFix project to construct two tunnels to facilitate water deliveries from the Sacramento-San Joaquin Delta;  Ensure local control, improving resilience to drought conditions by reducing reliance on imported water, funding conservation programs to assist Santa 3 of 11 Monicans to continue to save water, and developing locally sourced potable and non-potable water supplies; and  Maintain the recommended $7 million Water Fund reserve to ensure continuity of water system operations and completion of capital projects. Background On February 24, 2015 (Attachment A), Council approved the following schedule of water rate increases via resolution, subject to an annual State of the Water Fund review, analyzing fiscal performance and projected fund balances: Calendar Year 2015 2016 2017 2018 2019 Effective Date March 1, 2015 January 1, 2016 January 1, 2017 January 1, 2018 January 1, 2019 Maximum Authorized Increase 9% 9% 9% 9% 9% Actual Increase 9% 5% 5% 5% 9% recommended Rate increases go into effect automatically on an annual basis unless suspended, all or in part, by Council. Due to revenues exceeding forecasts, deferred capital projects, and Water Fund balances well above the recommended $7 million fund reserve level, Council suspended a portion of the 9% rate increases for calendar years 2016, 2017, and 2018. Council approved smaller increases during these years in response to annual reports provided by staff, projecting that expenditures would exceed revenues without rate increases. On November 27, 2018 (Attachment B), Council approved an updated Sustainable Water Master Plan mapping out the path for the City to achieve its goal of water self- sufficiency by 2023 through a combination of conservation, alternative/recycled water supplies, and new potable water production and treatment. As outlined in the Sustainable Water Master Plan (SWMP), the proposed rate increase of 9% for 2019 would fund the preliminary design of water treatment plant capacity and efficiency improvements at the City’s Arcadia treatment plant and the purchase of a new 4 of 11 groundwater well. Beyond 2019, based on the updated SWMP, the Water Fund would need to fund $34.75 million in capital upgrades to the Arcadia treatment plant to increase treatment capacity and efficiency, along with development of new wells. Funding for these projects will be considered during the calendar year 2020–2024 water/wastewater rate study which is currently underway. Also, as a part of Council’s actions on November 27, 2018, an additional $64.1 million in pollution settlement funds were dedicated. These “non-ratepayer” funds will be used to restore the groundwater in the Olympic Sub-basin, allowing additional water production from that sub-basin to support water self-sufficiency. The Settlement Funds section later in this report includes a breakdown of these project costs. Discussion Water Fund Performance The Water Fund balance at the end of FY 2017-18 was approximately $34.8 million (not including $11.1 million in settlement funds previously reserved for Olympic Sub-basin monitoring and remediation activities). Revenues of $26.6 million in FY 2017-18 exceeded forecasts by $1 million. Expenditures of $23.2 million were $1 million less than expected, largely due to landscape rebate conservation program savings, which will be carried over into FY 2018-19 to help reduce water demand. Overall, the Water Fund operating budget was nearly balanced. While the FY 2017-18 ending fund balance was $34.8 million, the projected FY 2018-19 ending fund balance will be $11.7 million, which means the City will be getting close to the recommended $7 million minimum reserve level. This reserve level should be maintained to accommodate the multi-year nature of capital improvement projects and the fact that rate studies follow a calendar year schedule, not a fiscal year schedule The FY 2018-19 decrease in the fund balance will be mostly due to the aggressive Capital Improvement Program that is anticipated to cost $30 million in FY 2018-19. Major projects are related to water self-sufficiency, water main replacements, facility improvements, and technology upgrades (see table in 2019 Rate Adjustment 5 of 11 Recommendation section below for two-year overview). In addition, operating costs in FY 2018-19 are projected to be $25 million to maintain the City’s water distribution, production, and treatment systems. Meanwhile, projected revenues and transfers are forecast to be $32 million. 2019 Rate Adjustment Recommendation Staff recommends full implementation of the previously approved 9% water rate increase for 2019, resulting in an estimated water bill increase of $4.33 per month for the average single-family home customer and taking effect in March of 2019. The recommendation is based on: 1) the rate increases approved in the 2015, 2) the water rate study presented to Council in 2015, and 3) the City’s water self-sufficiency plan. In addition to funding ongoing operations, this increase would support $38.6 million in water-related capital projects planned for FY 2018-19 and FY 2019-20, critical to achieving water self-sufficiency as outlined below. Project Type FY 18/19 to FY 19/20 Amount Project Summary Water Main Replacements $16.5 million Water main replacements – 2 miles per year (100-year replacement schedule) plus paving/sidewalk repair costs and matching funds for one-time grant funded water main replacements. Includes funds rolled over from previous years for replacements not completed due to staffing and procurement related issues. Water Production & Well Enhancements $11.6 million Design of Arcadia Water Plant capacity and efficiency improvements, production well acquisition, re-drilling and outfitting of well. Water Facilities Improvements $7.5 million Reservoir water quality upgrades, City Yards tenant improvement project. Groundwater Management $1.0 million Santa Monica Basin Groundwater Sustainability Plan development, groundwater and flow model studies and 2020 Urban Water Management Plan. Software & Technology $0.8 million Computer equipment, control systems, billing / work order system software upgrades and smart water meter pilot 6 of 11 program. Vehicles $0.8 million Ongoing City vehicle replacements. Conservation $0.3 million Irrigation controller replacements at City locations. Totals: $38.6 million Proposed and current water and fire line service rates are listed in Attachment C. Supporting Information The recommendation for full implementation of the previously approved 9% increase for 2019 is supported by three key factors: 1) maintaining an annual 100-year water main replacement cycle; 2) acquisition of a new groundwater well; and 3) preliminary design of water treatment plant capacity improvements. 1) Annual water main replacements – Escalating construction costs over a number of years has impacted the water main replacement cycle. In 2016, Council authorized increasing the water main replacement budget from $2 million per year, as modeled in the 2015 water rate study, to $4 million per year, to return to a 100-year replacement cycle as recommended in the City’s Sustainable Water Master Plan. At $400 per linear foot, $4 million would fund replacement of two miles per year for the City’s 205-mile water main system. However, in the current high-cost construction environment, recent 2017 and 2018 water main replacement contract awards have returned bids of $600 to $700 per linear foot, requiring an increase to $6 million per year to stay on a 100-year replacement cycle. Maintaining a $4-million-per-year budget would only yield replacement of 1.1 to 1.25 miles of pipeline per year, increasing the replacement cycle to approximately 160 to 190 years. Staff recommends staying on a 100-year replacement cycle, consistent with industry standard, to maintain operational reliability, avoiding water main breaks and associated water losses, and impacts to property and traffic. 2) Acquisition of a new groundwater well – An additional water well would augment production and enhance resiliency. Acquisition costs are estimated at $8 million 7 of 11 total, with $4.75 million from the Water Fund and $3.25 million from the Wastewater Fund. 3) Preliminary design of water treatment plant capacity improvements – Enhancements to help the water treatment process at the Arcadia treatment plant would improve capacity and increase the efficiency of the plant. The project budget is $30 million; $3.18 million is budgeted in FY 2018-19, to start design to accommodate increased groundwater production and improve overall plant efficiency to 90% or greater. This project cost was updated based on results of recently completed feasibility studies by Black & Veatch and Brown & Caldwell. Prior plans had less significant infrastructure improvements at the Arcadia treatment plant based on strategy to construct a separate Olympic treatment plant, which would both restore the Olympic Sub-basin and produce potable water. Feasibility studies concluded, however, that constructing an additional standalone Olympic treatment plant is cost prohibitive. Thus, after further evaluation, staff recommended expanding the capacity of the existing Arcadia treatment plant and enhancing its production, instead of constructing a new Olympic treatment plant. Based on higher than anticipated revenues and past capital program estimates, Council was able to suspend a portion of the previously approved 9% water rate increases for each of the past three years. Due to increased FY 2018-20 capital cost estimates developed over the past year for water main replacements and updated Arcadia Water Plant capacity/efficiency upgrades, along with the commitment of all remaining Olympic settlement funds for groundwater remediation (discussed in the following section), staff recommends Council adopt a 9% water rate increase for 2019 (monthly increase of $4.33 to an average single-family home customer). Settlement Funds $64.1 million from existing water-contamination settlement funds, allocated by Council on November 27, 2018, would be used to restore groundwater in the Olympic Sub- basin, which would allow additional water production from that sub-basin to support water self-sufficiency. The Olympic Sub-basin restoration cost includes an approximate, 8 of 11 one-time $20 million capital expenditure for treatment systems and an additional $20 million to fund 30 years of ongoing operation and maintenance of the treatment systems. Based on current modeling projections, more than 80% of the Olympic Sub- basin will be remediated within the first 30 years. However, the sub-basin may not be completely restored at that point. Thus, the remaining balance of settlement funds ($24 million) would be reserved to address any contamination that may still be present after 30 years or any new regulations that may impact use of the Olympic sub-basin in the future. While these costs will not impact ratepayers, reserving all Olympic Settlement Funds for remediation and monitoring purposes currently precludes any subsidies from being applied to water rates. Alternatives A full suspension of the 2019 rate increase: This would lead to lowered revenue resulting in the need for significant reductions and/or delays in the annual water main replacements and the City’s goal for water self-sufficiency. Implications would need to be addressed during the 2020–2024 water/wastewater rate study in the form of rate structure modifications. Implementing a 7% or 5% 2019 rate increase: This $3.36 or $2.44 respective monthly increase to an average single-family home customer would result in $3.2 million (7% rate increase) or $6.3 million (5% rate increase) in lower revenue over a five-year period. While less disruptive than the “no increase” alternative, this approach would likely leading to either a backlog of needed capital investment or a need to catch up in the form of double digit annual increases in the future. Any reduction n in rate increases would impact the necessary funding to help achieve water self-sufficiency. Further, a 5% rate increase would also leave the projected fund balance at $2.1 million in FY 2023-24 compared to $8.4 million with a 9% rate increase. The 4% difference between the two rates is approximately $6.3 million by FY 2024-25. This almost equates to funding for two self-sufficiency projects approved by Council on November 27, 2018, for acquisition of a new groundwater well for $3.25 million and the preliminary design of enhancements at the Arcadia treatment plant for $3.18 million. Attachment D provides Water Fund forecasts through Fiscal Year 2023-24 with 9%, 7% and 5% rate increases 9 of 11 for 2019. Water Bill Comparison with Neighboring Water Agencies Comparing rates with 15 other Metropolitan Water District (MWD) member water agencies, Santa Monica’s tiered rate structure currently offers close to the lowest costs in the region for the average single-family home account. A 2019 rate increase of 9% (monthly increase of $4.33 to an average single-family home customer) would place Santa Monica in the middle of the range, raising bi-monthly bills by $8.65 to $104.92 (average cost of $0.0056 per gallon). By comparison, a 5% increase would raise bills by $4.88 to $101.15 per billing period, while a 7% increase would lead to a rise of $6.71 to $102.98. The City of Anaheim currently offers the lowest pricing at $89, followed by the City of Fullerton at $91, and the City of San Marino at $95, as indicated in the following figure: 10 of 11 Implementation of the previously approved 2019 rate increase would go into effect for water consumption beginning on January 1, 2019, effective on water bills prepared on or after March 1, 2019, as water meters are read approximately every two months (e.g., a bill issued for a meter read on March 1, 2019 would reflect water usage from January 1 to February 28, 2019). Next Steps A water/wastewater rate study is currently underway to set water and sewer bill rates for calendar years 2020–2024. As part of the rate study, funding options will be developed for Council approval with input from the public and advisory groups to meet the City’s water and wastewater revenue requirements. Considerations will include:  Financing mechanism for water self-sufficiency projects, including Arcadia treatment plant upgrades and acquisition of a new groundwater well ($34.75 million) via a water bond, grants and loans from restricted funds, or a combination thereof;  Increasing the water main replacement budget from $4 million per year to an average of $6 million per year to remain on the recommended 100-year replacement cycle;  Maintaining a $5-million-per-year budget for imported water through 2023 (increase of approximately $8.7 million from 2020 to 2023) for purchase of approximately 3,500 acre-feet per year until water self-sufficiency is achieved;  Construction of a Closed Circuit Reverse Osmosis System at the Arcadia treatment plant that would increase the operating budget by $2 million per year starting in FY 22-23 to increase treatment efficiency from 82% to 90% or more; and  Additional items identified by the public, advisory groups, staff, and Council. Staff will return to Council by mid-2019 for a study session on water/wastewater rates. Notices will be issued, as required by Proposition 218, in August 2019 and a public hearing for adoption of calendar year 2020 to 2024 water/wastewater rate in October 2019. 11 of 11 Task Force on the Environment / Water Advisory Committee Review Rate adjustment recommendations were presented for review and discussion to the Water Advisory Committee on November 5, 2018, to the Task Force on the Environment Water Subcommittee on November 19, 2018. While both groups expressed support for the staff recommendations during their meetings, due to lack of quorums, neither Committee was able to take formal action with regard to the rate recommendation. Financial Impacts and Budget Actions Staff anticipates FY 2018-19 Water – Commercial Sales revenues to remain at $24,842,077, based on a 9% 2019 water rate increase and water usage in line with the current Sustainable Water Master Plan estimate (approximately 11,600 acre-feet per year / per capita usage of 110 gallons per day). Should a lower 2019 rate increase be implemented, or observed water usage fluctuate, this revenue account would be adjusted accordingly. Prepared By: Alex Nazarchuk, Water Resources Manager Approved Forwarded to Council Attachments: A. February 24, 2015 Staff Report - Public Hearing to Adopt Water Rates (Item 9-A) - WEBLINK B. November 27, 2018 Staff Report - Sustainable Water Master Plan Update and Pathway to Water Self-Sufficiency (Item 8.C) - WEBLINK C. 2019 Water Rate Adjustment Options D. Water Fund Forecasts with 2019 Rate Options Tier Full Suspension / 0% Adjustment (per HCF) Partial Suspension +5% Adjustment (per HCF) Partial Suspension +7% Adjustment (per HCF) No Suspension With 9% Adjustment (per HCF) Usage Range  per Billing Period (HCF's) Tier 13 . 1 6$                           3.32$                          3.38$                          3.44$                               0 to 14 Tier 24 . 7 3$                           4.97$                          5.06$                          5.16$                               15 to 40 Tier 37 . 1 0$                           7.46$                          7.60$                          7.74$                               41 to 148 Tier 4 11.10$                         11.66$                        11.88$                        12.10$                            149+ Tier 13 . 1 6$                           3.32$                          3.38$                          3.44$                               0 to 4 per dwelling unit Tier 24 . 7 3$                           4.97$                          5.06$                          5.16$                               5 to 9 per dwelling unit Tier 37 . 1 0$                           7.46$                          7.60$                          7.74$                               10 to 20 per dwelling unit Tier 4 11.10$                         11.66$                        11.88$                        12.10$                            21+ per dwelling unit Tier 14 . 4 8$                           4.70$                          4.79$                          4.88$                               Depends on meter size* Tier 2 11.06$                         11.61$                        11.83$                        12.06$                            Depends on meter size* Recycled Water 4.03$                           4.23$                          4.31$                          4.39$                               All usage Meter Size Full Suspension Fixed Charge  per Billing Period Partial Suspension +5% Adjustment Fixed Charge Partial Suspension +7% Adjustment (per HCF) No Suspension With 9% Adjustment Fixed Charge 1‐1/2" meter 45.20$                         47.46$                        48.36$                        49.27$                             2" meter 72.52$                         76.15$                        77.60$                        79.05$                             3" meter 124.81$                       131.05$                      133.55$                      136.04$                           4" meter 199.49$                       209.46$                      213.45$                      217.44$                           6" meter 386.10$                       405.41$                      413.13$                      420.85$                           8" meter 610.04$                       640.54$                      652.74$                      664.94$                           10" meter 871.29$                       914.85$                      932.28$                      949.71$                           *Non‐Residential Accounts ‐  Tier Designations by Meter Size and Usage Range Meter Size  Tier 1 Usage (HCF's) Tier 2 Usage (HCF's) 3/4" meter 0 to 210 211+ 1" meter 0 to 210 211+ 1‐1/2" meter 0 to 465 466+ 2" meter 0 to 870 871+ 3" meter 0 to 1,700 1,701+ 4" meter 0 to 2,550 2,551+ 6"+ meter 0 to 5,280 5,281+ ATTACHMENT C Each billing period is approximately 61 days (~6 billing periods per year) Fireline Service Rates 2019 Water Rate Options by Account Type, Tier and Meter Size Single Family Accounts Multi‐Family Accounts Non‐Residential Accounts 1 HCF = 1 Hundred Cubic Feet of water = 748 gallons Wa t e r F u n d - 5 0 Fi n a n c i a l S t a t u s U p d a t e FY 2 0 1 8 - 1 9 t o F Y 2 0 2 3 - 2 4 FY 1 8 \ 1 9 F Y 1 9 \ 2 0 F Y 2 0 \ 2 1 F Y 2 1 \ 2 2 F Y 2 2 \ 2 3 F Y 2 3 \ 2 4 BE G I N N I N G F U N D B A L A N C E (N o t I n c l u d i n g R e s t r i c t e d C a s h a pp ro p ri a t e d f o r u s e ) 34 , 8 2 0 , 7 9 6 1 1 , 7 1 9 , 0 9 8 3 4 , 1 7 1 , 2 5 0 2 3 , 2 4 3 , 5 9 0 8 , 5 2 2 , 2 5 9 7 , 7 4 2 , 4 7 1 Re v e n u e s 2 8 , 0 1 7 , 3 7 4 3 1 , 5 8 9 , 3 4 8 3 4 , 1 5 2 , 5 7 2 3 6 , 5 1 8 , 5 1 6 3 8 , 3 3 3 , 6 8 9 3 9 , 7 7 4 , 6 3 7 Ex p e n d i t u r e s ( 2 5 , 0 3 3 , 7 7 6 ) ( 2 3 , 7 1 2 , 2 2 2 ) ( 2 4 , 2 7 2 , 9 4 2 ) ( 2 4 , 9 4 0 , 0 0 5 ) ( 2 7 , 8 3 1 , 2 7 4 ) ( 2 4 , 7 6 6 , 4 6 3 ) No n - D e p t . T r a n s a c t i o n s 3 , 7 3 8 , 6 9 8 3 1 , 1 0 4 , 9 6 0 8 5 6 , 3 1 3 9 , 8 9 3 , 5 5 8 ( 4 , 2 6 2 , 7 8 9 ) ( 4 , 3 1 9 , 5 5 3 ) Ca p i t a l I m p r o v e m e n t P r o g r a m ( C I P ) ( 2 9 , 8 2 3 , 9 9 3 ) ( 1 6 , 5 2 9 , 9 3 4 ) ( 2 1 , 6 6 3 , 6 0 2 ) ( 3 6 , 1 9 3 , 4 0 0 ) ( 7 , 0 1 9 , 4 1 4 ) ( 1 0 , 0 1 3 , 0 2 3 ) PR O J E C T E D E N D I N G F U N D B A L A N C E 11 , 7 1 9 , 0 9 8 3 4 , 1 7 1 , 2 5 0 2 3 , 2 4 3 , 5 9 0 8 , 5 2 2 , 2 5 9 7 , 7 4 2 , 4 7 1 8 , 4 1 8 , 0 6 9 MI N I M U M R E C O M M E N D E D R E S E R V E (7 , 0 0 0 , 0 0 0 ) ( 7 , 0 0 0 , 0 0 0 ) ( 7 , 0 0 0 , 0 0 0 ) ( 7 , 0 0 0 , 0 0 0 ) ( 7 , 0 0 0 , 0 0 0 ) (7,000,000) PR O J E C T E D E N D I N G F U N D B A L A N C E LE S S R E C O M M E N D E D R E S E R V E 4, 7 1 9 , 0 9 8 2 7 , 1 7 1 , 2 5 0 1 6 , 2 4 3 , 5 9 0 1 , 5 2 2 , 2 5 9 7 4 2 , 4 7 1 1 , 4 1 8 , 0 6 9 AT T A C H M E N T D OP T I O N 1 - S T A F F R E C O M M E N D A T I O N - 9 % 2 0 1 9 W A T E R R A T E I N C R E A S E FO R E C A S T Wa t e r F u n d - 5 0 Fi n a n c i a l S t a t u s U p d a t e FY 2 0 1 8 - 1 9 t o F Y 2 0 2 3 - 2 4 FY 1 8 \ 1 9 F Y 1 9 \ 2 0 F Y 2 0 \ 2 1 F Y 2 1 \ 2 2 F Y 2 2 \ 2 3 F Y 2 3 \ 2 4 BE G I N N I N G F U N D B A L A N C E (N o t I n c l u d i n g R e s t r i c t e d C a s h a pp ro p ri a t e d f o r u s e ) 34 , 8 2 0 , 7 9 6 1 1 , 5 0 9 , 3 9 1 3 3 , 4 5 5 , 4 7 0 2 1 , 9 8 1 , 2 5 0 6 , 6 6 3 , 7 3 3 5 , 2 5 3 , 5 3 8 Re v e n u e s 2 7 , 8 0 7 , 6 6 7 3 1 , 0 8 3 , 2 7 5 3 3 , 6 0 6 , 0 1 3 3 5 , 9 2 2 , 3 3 0 3 7 , 7 0 3 , 2 8 2 3 9 , 1 1 8 , 8 2 4 Ex p e n d i t u r e s ( 2 5 , 0 3 3 , 7 7 6 ) ( 2 3 , 7 1 2 , 2 2 2 ) ( 2 4 , 2 7 2 , 9 4 2 ) ( 2 4 , 9 4 0 , 0 0 5 ) ( 2 7 , 8 3 1 , 2 7 4 ) ( 2 4 , 7 6 6 , 4 6 3 ) No n - D e p t . T r a n s a c t i o n s 3 , 7 3 8 , 6 9 8 3 1 , 1 0 4 , 9 6 0 8 5 6 , 3 1 3 9 , 8 9 3 , 5 5 8 ( 4 , 2 6 2 , 7 8 9 ) ( 4 , 3 1 9 , 5 5 3 ) Ca p i t a l I m p r o v e m e n t P r o g r a m ( C I P ) ( 2 9 , 8 2 3 , 9 9 3 ) ( 1 6 , 5 2 9 , 9 3 4 ) ( 2 1 , 6 6 3 , 6 0 2 ) ( 3 6 , 1 9 3 , 4 0 0 ) ( 7 , 0 1 9 , 4 1 4 ) ( 1 0 , 0 1 3 , 0 2 3 ) PR O J E C T E D E N D I N G F U N D B A L A N C E 11 , 5 0 9 , 3 9 1 3 3 , 4 5 5 , 4 7 0 2 1 , 9 8 1 , 2 5 0 6 , 6 6 3 , 7 3 3 5 , 2 5 3 , 5 3 8 5 , 2 7 3 , 3 2 2 MI N I M U M R E C O M M E N D E D R E S E R V E (7 , 0 0 0 , 0 0 0 ) ( 7 , 0 0 0 , 0 0 0 ) ( 7 , 0 0 0 , 0 0 0 ) ( 7 , 0 0 0 , 0 0 0 ) ( 7 , 0 0 0 , 0 0 0 ) (7,000,000) PR O J E C T E D E N D I N G F U N D B A L A N C E LE S S R E C O M M E N D E D R E S E R V E 4, 5 0 9 , 3 9 1 2 6 , 4 5 5 , 4 7 0 1 4 , 9 8 1 , 2 5 0 (3 3 6 , 2 6 7 ) ( 1 , 7 4 6 , 4 6 2 ) ( 1 , 7 2 6 , 6 7 8 ) AT T A C H M E N T D OP T I O N 2 - 7 % 2 0 1 9 W A T E R R A T E I N C R E A S E FO R E C A S T Wa t e r F u n d - 5 0 Fi n a n c i a l S t a t u s U p d a t e FY 2 0 1 8 - 1 9 t o F Y 2 0 2 3 - 2 4 FY 1 8 \ 1 9 F Y 1 9 \ 2 0 F Y 2 0 \ 2 1 F Y 2 1 \ 2 2 F Y 2 2 \ 2 3 F Y 2 3 \ 2 4 BE G I N N I N G F U N D B A L A N C E (N o t I n c l u d i n g R e s t r i c t e d C a s h a pp ro p ri a t e d f o r u s e ) 34 , 8 2 0 , 7 9 6 1 1 , 2 9 9 , 6 8 4 3 2 , 7 3 9 , 6 8 9 2 0 , 7 1 8 , 9 1 1 4 , 8 0 5 , 2 0 7 2 , 7 6 4 , 6 0 4 Re v e n u e s 2 7 , 5 9 7 , 9 6 0 3 0 , 5 7 7 , 2 0 1 3 3 , 0 5 9 , 4 5 3 3 5 , 3 2 6 , 1 4 3 3 7 , 0 7 2 , 8 7 4 3 8 , 4 6 3 , 0 1 1 Ex p e n d i t u r e s ( 2 5 , 0 3 3 , 7 7 6 ) ( 2 3 , 7 1 2 , 2 2 2 ) ( 2 4 , 2 7 2 , 9 4 2 ) ( 2 4 , 9 4 0 , 0 0 5 ) ( 2 7 , 8 3 1 , 2 7 4 ) ( 2 4 , 7 6 6 , 4 6 3 ) No n - D e p t . T r a n s a c t i o n s 3 , 7 3 8 , 6 9 8 3 1 , 1 0 4 , 9 6 0 8 5 6 , 3 1 3 9 , 8 9 3 , 5 5 8 ( 4 , 2 6 2 , 7 8 9 ) ( 4 , 3 1 9 , 5 5 3 ) Ca p i t a l I m p r o v e m e n t P r o g r a m ( C I P ) ( 2 9 , 8 2 3 , 9 9 3 ) ( 1 6 , 5 2 9 , 9 3 4 ) ( 2 1 , 6 6 3 , 6 0 2 ) ( 3 6 , 1 9 3 , 4 0 0 ) ( 7 , 0 1 9 , 4 1 4 ) ( 1 0 , 0 1 3 , 0 2 3 ) PR O J E C T E D E N D I N G F U N D B A L A N C E 11 , 2 9 9 , 6 8 4 3 2 , 7 3 9 , 6 8 9 2 0 , 7 1 8 , 9 1 1 4 , 8 0 5 , 2 0 7 2 , 7 6 4 , 6 0 4 2 , 1 2 8 , 5 7 6 MI N I M U M R E C O M M E N D E D R E S E R V E (7 , 0 0 0 , 0 0 0 ) ( 7 , 0 0 0 , 0 0 0 ) ( 7 , 0 0 0 , 0 0 0 ) ( 7 , 0 0 0 , 0 0 0 ) ( 7 , 0 0 0 , 0 0 0 ) (7,000,000) PR O J E C T E D E N D I N G F U N D B A L A N C E LE S S R E C O M M E N D E D R E S E R V E 4, 2 9 9 , 6 8 4 2 5 , 7 3 9 , 6 8 9 1 3 , 7 1 8 , 9 1 1 (2 , 1 9 4 , 7 9 3 ) ( 4 , 2 3 5 , 3 9 6 ) ( 4 , 8 7 1 , 4 2 4 ) AT T A C H M E N T D OP T I O N 3 - 5 % 2 0 1 9 W A T E R R A T E I N C R E A S E FO R E C A S T