Without the need for any major capital investment projects during fiscal 2016-17, the Fern Valley Water District will make a substantial reduction in its unfunded balance for other post-employment employee benefits, e.g., retiree healthcare.
The board reviewed a draft of its budget for fiscal 2016-17, which begins July 1, during its May 20 session. The proposed budget expects revenues of about $1,062,000 and expenses of about $1,055,400 for a net positive balance of $6,600.
This fiscal year, the district projects a net loss of nearly $480,000, but expenses included $670,000 for capital projects including pipeline replacement.
The operating expenses for the district will be $640,000, which is less than the $700,000 budget for this year and the projected actual operating costs of $656,000.
Explaining the decision to reduce the unfunded balance, Director Richard Schnetzer said, “We recommended putting the $200,000 in the unfunded liability rather than letting it grow until we might have future budget shortfalls.”
The unfunded balance for these retirement benefits was about $240,000 at the end of June 2014. Since then the district has paid $25,000 each year and essentially will eliminated the unfunded debt going forward.
There are no other major increases or decreases in the operating accounts. The budget for employee salaries will be $262,000, $20,000 less than the projected actuals, which were greater than the budgeted amount because the district hired Victor Jimenez as the new general manager and his time overlapped with current General Manager Steve Erler.
The district also plans to replace its vehicle fleet in 2016-17. Pipeline replacement work will resume in fiscal 2017-18.
Before the board approved the draft budget pending no changes in the final budget, which it will adopt at its June meeting. Director Robert Krieger said, “I’m in agreement with everything. I think it’s a fine budget.”
In water business, Erler said that Strawberry Creek flow has been decreasing, “… which is typical for this time of year. The well levels are up and down from last month,” depending on which well. Creek flow has improved compared to 2015, supplying more than 90 percent of the district’s water in April compared to 23 percent in 2015. Well levels are higher than a year ago.
During the two-month billing period for March and April, FVWD customers consumed 4.5 million gallons of water, which is 180,000 gallons fewer than the same period in 2015. For the first four months of 2016, FVWD water consumption is 8.4 million gallons or 500,000 fewer (6.5 percent less) than in 2015.
The District’s water loss was 10 percent during March and April and declined from 15 percent in the last period.
