HomeMy WebLinkAboutF-2 Fiscla Year 2015-2016 First Quarter Budget Reports Information Item
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INFORMATION ITEM
TO: HONORABLE CHAIRPERSON AND MEMBERS OF THE A SA UTILITY
BOARD
FROM: GEORGE F. MORROW, DIRECTOR OF UTILITIES
DATE: NOVEMBER 23, 2015
SUBJECT: FISCAL YEAR 2015-2016 FIRST QUARTER BUDGET REPORTS FOR
WATER AND ELECTRIC FUNDS
The attached reports include unaudited budget-to-actual performance for the Water and Electric
Funds through September 30, 2015.
Cash in the Water Fund decreased by$56,604 and increased in the Electric Fund by $213,047 for
the first quarter.
WATER
Sales of water through first quarter were 19.6% lower than the first quarter of prior fiscal year.
This decrease is primarily due to conservation efforts as a result of drought conditions and state
water reduction mandate. The table below shows a 10-year trend of first quarter sales, billings,
and number of billed accounts for the Water Utility:
1st Quarter Water Sales/Billings
FY CCF Sales Billings Billed Accounts
06-07 2,118,839 $3,227,055 22,720
07-08 2,875,872 $4,659,711 22,618
08-09 2,498,047 $4,073,146 22,701
09-10 2,490,393 $4,622,114 22,698
10-11 2,428,273 $5,111,232 22,671
11-12 2,417,523 $5,156,389 22,457
12-13 2,581,898 $5,454,417 22,643
13-14 2,450,574 $5,240,322 22,888
14-15 2,240,761 $5,245,932 23,175
15-16 1,802,376 $4,125,782 23,356
Cash reserves, after in advances to other funds, decreased $56,604, to $21.5 million, which
exceeds the Utility's $19.0 million reserve policy. The first quarter cash decrease was primarily
UB-173
Quarterly Financial Report
November 23,2015
Page 2
due to the decline in retail revenues resulting from significant conservation due to drought
conditions, and the state mandate for Azusa Light & Water to reduce water production by 20%
from 2013 levels water conservation in AL&W service territory. Although sales have declined,
first quarter operating results yielded estimated debt coverage of 1.48 times the debt service
payments due through September 30,which exceeds the minimum requirement of 1.25 times.
ELECTRIC
Sales of electricity through the first quarter ended were 3.5% lower than the same period last
fiscal year. This decrease is mainly due to conservation by industrial customers, increased solar
production, and somewhat milder weather. The table below shows a 10-year trend of first quarter
sales, billings, and number of billed accounts for the Electric Utility:
1st Quarter Electric Sales/Billings
FY kWh Sales Billings Billed Accounts
06-07 52,882,099 $6,540,829 15,621
07-08 74,574,610 $8,636,012 15,756
08-09 74,709,048 $9,921,295 15,906
09-10 71,339,048 $8,787,362 15,768
10-11 66,556,732 $9,579,024 15,707
11-12 68,825,090 $10,687,879 15,849
12-13 71,583,192 $10,922,876 15,925
13-14 71,811,811 $10,996,464 16,142
14-15 75,927,794 $12,260,244 16,555
15-16 73,275,667 $10,990,027 16,765
First quarter revenues and expenses are on track with budget at 25% and 24%, respectively.
Cash/Reserves are made up of cash on hand and cash held in rate stabilization fund. Cash
increased by $213,047 for first quarter ended and total approximately $20.5 million, which well
exceeds the Utility's minimum reserve policy requirement of$12.6 million.
Positive operating results and fairly low debt service requirements has resulted in the Electric
Utility exceeding the minimum debt coverage requirement of 1.10 with estimated debt coverage
of 9.87 for the period ended.
Prepared by: Talika M. Johnson, Utilities Administrative and Financial Services Manager
Attachments: 1st Quarter Water Utility Operating Budget Report
1 s`Quarter Electric Utility Operating Budget Report
UB-174
Electric Utility Quarterly Budget Report
1st Quarter Ended September 30, 2015
(UNAUDITED)
Placa Year End 1st Qtr Ended
Consmaption and,Cash Reserves Percent
30115 9/30/15
Consumption-kWh: 257,361,329 73,275,667 28%
Cash,Investments&Cash Reserves:(1) $ 20,323,821 $ 20,536,868 101%
Budget Line item
B P. t A . T Percent of Budget
15-16 9/3030/15
Revenues:
Retail Billing Amounts(2) $ 38,699,845 $ 10,990,027 28%
Resale Revenue(3) 7,704,885 861,541 11%
Other Miscellaneous Revenue 250,000 39,186 16%
Interest Income 115,000 26,738 23%
Total Revenues $ 46,769,730 $ 11,917,492 25%
Expenses:
Purchased Power(3) 30,772,590 7,123,988 23%
Transmission/Dispatching(3) 4,640,680 953,382 21%
Operations and Maintenance 3,070,545 745,955 24%
Administrative and General(4) 4,399,855 1,039,509 24%
Franchise and In-Lieu-Tax 3,869,990 1,104,198 29%
Subtotal Expenses $ 46,753,660 $ 10,967,032 23%
Capital Expenditures/Debt Service:
Debt Service Requirements(5) 839,015 208,202 25%
Capital Outlays and Projects 2,058,780 529,211 26%
Total Expenditures $ 49,651,455 $ 11,704,445 24%
Adjustments:
Transfers Out - - 0%
Total Expenditures and Transfers Out $ 49,651,455 $ 11,704,445 24%
Net Increase(Decrease)in Cash/Reserve $ (2,881,725) $ 213,047
Debt Coverage Ratio(6) 4.63 9.87
Notes:
(1)Includes Cash and investments and Cash held for Rate Stabilization.Reserve Policy is$12.6 million.
(2)Retail Billing Amounts based on Customer Information System as of 9/30/15.
(3)Source for Resale Revenues,Purchased Power,and Transmission/Dispatching: Power Resources Division.
(4)Includes 35%of Customer Service Fund expenses less offsetting revenue and other miscellaneous costs.
(5)Principal and Interest payment obligations on the 2003 and 20128 Revenue Bonds for Fiscal Year 2015/16 thru 9/30/2015.
(6)Total Revenue less Cost for Purch'd Pwr,T&D,O&M,and A&G,divided by debt service.Minimum debt coverage requirement
is 1.10 per bond financing agreements.
UB-175
Water Utility Quarterly Budget Report
1st Quarter Ended September 30,2015
(UNAUDITED)
Fiscal Year End 1st Otr Ended
Consumption and Cash Reserves Percent
6/30115 9/30115
Consumption-CCF: 7,094,934 1,802,376 25%
Cash and Investments before transfers:ttl $ 25,589,908 $ 25,533,304 100%
Cash and Investments after loans to other funds:(2) $ 21,589,908 $ 21,533,304 100%
Budget Actual Thru Percent of
Budget Line Item FY 15-16 9130115 Budget
Revenues:
Retail Billing Amounts(s) $ 15,151,825 $ 4,125,782 27%
Other Revenues(4) 3,419,720 604,664 18%
Interest Income 125,000 29,063 23%
Total Revenues $ 18,696,545 $ 4,759,509 25%
Expenses:
Production 5,982,360 1,214,306 20%
Transmission and Distribution 2,654,630 758,324 29%
Customer Accounting and Sales(5) 4,494,500 1,170,623 26%
Administrative and Engineering 1,075,760 282,650 26%
Franchise Fees 300,975 99,968 33%
Subtotal Expenses $ 14,508,225 $ 3,525,871 24%
Capital Expenditures/Debt Service:
Debt Service Requirements t5I 4,659,890 901,585 19%
Capital Outlays and Projects I'I 4,487,367 359,595 8%
Total Expenditures $ 23,655,482 $ 4,787,050 20%
Adjustments:
Transfers Out(9) - 29,063 N/A
Total Expenditures and Transfers Out $ 23,655,482 $ 4,816,113 20%
Net Increase(Decrease)in Cash $ (4,958,937) $ (56,604)
Debt Coverage Ratio(9) 0.96 1.48
Notes:
(1)Includes Cash and investments and Due from other funds.Reserve Policy was updated from$25 to$19 million in November 2014.
(2)Loans and Advances to other funds at FYE 6/30/15 were$4,000,000.
(3)Retail Billing Amounts based on Customer Information System as of 9/30/15.
(4)Other Revenues include Drought Penalty revenues of$378,269.,
(5)Includes 65%of Customer Service Fund expenses less offsetting revenue and other miscellaneous costs.
(6)Principal and Interest payment obligations on the 2012A and 2015 Revenue Bonds for Fiscal Year 2015/16 thru 9/30/2015.
(7)Capital Outlays and Projects under budget due to ongoing construction of Main Replacements and Reservoir Rehabilitation.
(8)Interest Income will be transferred to the CIP Fund by policy if there is positive net income at fiscal year end.
(9)Total Revenues less Production,T&D,Cust Acctg,&A&G divided by Debt Service Payments.Minimum debt coverage requirement
is 1.25 per bond financing agreements.
UB-176