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HomeMy WebLinkAboutMinutes - Water Finance Subcommittee - 2/8/2019 MINUTES ORO VALLEY WATER UTILITY COMMISSION FINANCE SUBCOMMITTEE FEBRUARY 8,2019 WATER UTILITY CONFERENCE ROOM 11000 N.LA CANADA DRIVE CALL TO ORDER—Chair Tustison called the meeting to order at 9:07 a.m. ROLL CALL PRESENT: Winston Tustison,Chair Chuck Hollingsworth,Member EXCUSED: Robert Milkey,Member ALSO PRESENT: Peter Abraham,P.E.,Water Utility Director Shirley Kiel,Water Utility Administrator Danielle Tanner,Sr.Office Specialist CALL TO AUDIENCE—No speakers. 1. APPROVAL DECEMBER 4,2018 MINUTES MOTION:A motion was made by Member Hollingsworth and seconded by Chair Tustison to approve the December 4,2018 minutes as written.MOTION carried,2-0. 2.DISCUSSION REGARDING THE 2019 WATER RATES ANALYSIS Ms.Kiel reviewed the following: • The beginning cash balance was revised due to the timing of debt service payments and the availability of restricted funds for use in 19/20. • Scenario C has been modified to reflect the updated cash reserves,updated debt service,lower water rates in the last 3 years and the purchase of additional Groundwater Extinguishment Credits(GECs) Mr.Abraham discussed the opportunity to increase the purchase of GECs to approximately 4,000 acre feet per year for the next two years.Ms.Kiel explained that increased funding was added in the the scenario to purchase additional GECs in all five years. Mr.Abraham explained the rate increase has not changed in the scenario for the first two years and it remains$1.81 for the average customer next fiscal year.Water rate decreases have been incorporated in subsequent years. 02-08-19 Water Utility Commission Finance Subcommittee 1 Mr.Abraham discussed the unknowns the Utility is facing and how a conservative cash reserve balance is critical at this time.He reviewed the following unknowns: - Probable increase in CAP water costs related to the DCP - Drought Contingency Plan potential cuts to CAP water deliveries - Potential reduction revenue related to Town golf course water use reduction It was the consensus of the Commission that the updates in the scenario are well thought out and the Subcommittee agrees with the changes.Ms.Kiel added that staff met seperately with Commissioner Milkey and he also agreed with the adjustments. All Subcommittee members agreed that since the proposed rate increase that was approved by the Commission in January had not changed,there was no need to take the revised financial scenario back to the Commission for a second approval. FUTURE AGENDA ITEMS—No items discussed.Ms.Kiel indicated the next meeting will tentatively be in August 2019. ADJOURNMENT MOTION:Member Hollingsworth MOVED to adjourn the meeting at 9:44 a.m.Motion seconded by Chair Tustison.MOTION carried,2-0. Prepared by: Danielle Tanner Senior Office Specialist I hereby certify that the foregoing minutes are a true and correct copy of the minutes of the regular session of the Water Utility Commission Finance Subcommittee of Oro Valley, Arizona held on the 8.day February,2019.I further certify that the meeting was duly called and held and that a quorum was present. 02-08-19 Water Utility Commission Finance Subcommittee 2