General Manager Steve Taylor said he worked with Treasurer Janet Crossland and Director of Finance and Accounting Don Coppock to form the proposals, which involved four areas: key performance indicators, financial targets, the rate stabilization fund and a vehicle replacement fund.
Taylor suggested the district define what the rate stabilization fund is meant to accomplish. The staff proposal was that the fund is meant only to help with “unusual, unforeseen financial circumstances,” such as the extra $1 million in power purchases in February. The fund could be used to cover the unexpected expenses compared to the budget, then the proposed policy gives three years to replenish the fund back to the $6 million mark.
Commissioners discussed methods by which to replenish the fund, either constantly or on an as-needed basis, expressing their desire to avoid rate increases. Staff said the fund is not meant to avoid rate increases altogether, as that is not
sustainable. However, it could mean avoiding sudden rate increases in response to unforeseen circumstances.
Staff also suggested starting a vehicle replacement fund. The district vehicle purchases vary year-to-year, since many of the large trucks cost as much as half a million dollars each. Instead of a fluctuating budget each year, a steady monthly
contribution could fill the fund to allow for easier budgeting, based on a 10-year plan.
Key performance areas and financial targets serve to gauge the district’s financial standing and give guides by which to achieve higher ratings for borrowing money. Taylor suggested raising some of those targets, such as the debt service ratio
and days of cash on hand, in order to be in an even stronger position.
The financial policies will be reviewed by the policy committee, then brought back to the board for approval.
In other business, the board:
Heard from Director of Power Resources and Broadband Services Ron Gadeberg that wholesale power sales were under budget again, due to low water flows leading to less power to sell. Wholesale sales for the year so far are $2.1 million under budgeted amounts. Retail sales are also about $811,428 under budget.
Heard from Gadeberg that broadband customers have reached 2,023 through retail service providers. The district has been losing access points lately, which are five to six years old. In the heat, the units tend to reboot, but in two weeks’ time, eight of them failed instead of rebooting. Several more have failed since then. The district had been losing one or two per year. However replacements are available and the district has begun upgrading the units.