HomeMy WebLinkAbout04. Review February 2020 Financial Overview and Investment Reports Page 1 of 7
Item 4.
,ek CENTRAL SAN
CENTRAL CONTRA COSTA SANITARY DISTRICT
April 2, 2020
TO: HONORABLE BOARD OF DIRECTORS
FROM: CHRIS THOMAS, FINANCE ADMINISTRATOR
KEVIN MIZUNO, FINANCE MANAGER
REVIEWED BY: PHILIP LEIBER, DIRECTOR OF FINANCE AND ADMINISTRATION
ANN SASAKI, DEPUTY GENERAL MANAGER
ROGER S. BAILEY, GENERAL MANAGER
SUBJECT: REVIEW FEBRUARY2020 FINANCIAL OVERVIEW AND INVESTMENT
REPORTS
In accordance with Section 53646 of the California Government Code, staff shall submit an investment report to
the General Manager and Board of Directors. While state law mandates this reporting shall be done at least
quarterly, Central San's Investment Policy further stipulates this reporting shall be conducted on a monthly
basis. Accordingly, attached is the investment report for the month of February 2020, which was reviewed by
the Finance Committee on March 24, 2020.
The investments held by the Central San on February 29, 2020 are shown by fund in the attached Investment
Portfolio Report. Pursuant to the Investment Policy and state law, the Investment Portfolio Report reports the
following: type of investment, issuer, date of maturity, par (or face) and dollar amount invested on all securities,
as well as the current market value as of the date of the report. The following table provides a summary of the
highlights included in the attached Investment Portfolio Report:
Fund Total Total Market Wgtd. Wgtd. FY 2019-20 FY 2019-20
Face Value Avg. Avg. Actual Int. Budgeted Int.
Value Yield Maturity Rev. (YTD) Rev. (YTD)
Running $39.1 M $39,248,084 1.72% 0.15 years $459,562 $633,328
Expense
Sewer $59.OM $59,172,471 1.84% 0.11 years $779,950 $449,328
Construction
Self-Insurance $6.9M $6,946,927 1.92% N/A $104,118 $119,928
Running Expense fund investment earnings are significantly under the year-to-date budget due to the significant
decline in market yields for fixed income held-to-maturity investments following the Board's approval of the FY
2019-20 budget. During the preparation of the FY 2019-20 budget in March/April 2019, the Running Expense
Fund was yielding approximately 2.48%, whereas the Fund's yield in February 2020 was only 1.72%, reflecting
a sizeable 76 basis point drop (a 30.6% reduction). As a ramification of this market situation, staff projects FY
April 2, 2020 Regular Board Meeting Agenda Packet- Page 30 of 115
Page 2 of 7
2019-20 investment income of the Running Expense Fund to fall short of the estimated budget. Fortunately,
positive variances in other operational revenues of the Running Expense fund are expected to offset this
revenue loss.
The portfolio is in compliance with the Board's adopted policy regarding Central San's investments and as of
February 29, 2020. The attached Investment Portfolio report also indicates Central San will meet expenditure
requirements for the next six months from a combination of maturing investments and revenues from budgeted
operations.
Strategic Plan Tie-In
GOAL THREE: Be a Fiscally Sound and Effective Water Sector Utility
Strategy 2- Manage costs
ATTACHMENTS:
1. Financial Overview
2. 1 nvestment Reports
April 2, 2020 Regular Board Meeting Agenda Packet- Page 31 of 115
CENTRAL CONTRA COSTA SANITARY DISTRICT ATTACHMENT 1
March 11,2020
TO: THE BOARD OF DIRE R
VIA: KEVIN MIZUNO
FROM: CHRIS THOMAS
SUBJECT: 0&M Variance Analysis
The following are brief year-to-date variance explanations through February 29,2020
YTD
Total FY YTD YTD Fav/(Unfav)
O&M Revenues: Budget Budgeted Actual Variance Explanation
Direct SSC higher than budgeted due to increased development and metered
Total $ 89,560,370 $ 41.670.960 $ 42..967.899 $ 1.296.939 consumption. SSC County,Interest Income-pension Higher than budgeted.
O&M Expenses:
Total Labor Charges $ 52,789,084 $ 34,741,368 $ 32,683,245 $ 2,058,123 Some positions budgeted for in July are filled later in the fiscal year resulting in savings,
and charges of labor to capital projects higher than planned for in O&M budget.
Unfunded Liabilities 12,436,841 8,152,136 8,169,401 (17,265) No significant variances.
Chemicals 1,620,000 1,079,976 995,891 84,085 No significant variances.
Utilities 4,209,350 2,806,184 2,866,871 (60,687) No significant variances.
Repairs&Maintenance 5,242,867 3,535,064 2,975,729 559,335 Mainly due to Outside Repairs being lower than budgeted thus far in the fiscal year.
- Budget is spread evenly throughout the year,however actual activity occurs sporadically
every month. Variance should be minimal by year end.
Hauling&Disposal 1,186,175 790,736 618,798 171,938 Mainly due to hazardous waste disposal being lower than budgeted thus far in the fiscal
year. Budget is spread out evenly throughout the year,however actual activity occurs
sporadically every month.
Professional&Legal Services 874,300 582,800 229,355 353,445 Lower mostly due to lower Legal expenses thus far in the fiscal year.
Outside Services 3,639,547 2,399,453 1,447,418 952,035 Mainly due to technical services expenses being lower than budgeted thus far in the fiscal
year.
Materials&Supplies 2,152,127 1,434,567 1,336,128 98,439 No significant variances.
Other Expenses 2,464,834 1,868,180 1,506,474 361,706 Mainly due to Public Information,BACWA expenses,being lower than budgeted thus far
in the fiscal year. Budget is spread evenly throughout the year,however actual activity
occurs sporadically every month.
All Other 969,650 921,424 925,551 (4,127) Minor variances for multiple account categories.
Grand Total O&M Expenses $ 87,584,775 $ 58.311,888 $ 53.754.861 $ 4.557,027
April 2, 2020 Regular Board Meeting Agenda Packet- Page 32 of 115
CENTRAL CONTRA COSTA SANITARY DISTRICT
March 11,2020
TO: THE BOARD OF DIRECTORS
VIA: KEVIN MIZUNO
r
FROM: CHRIS THOMAS
SUBJECT: Sewer Construction Variance Analysis
The following are brief year-to-date variance explanations through February 29,2020:
YTD
Total FY YTD YTD Fav/(Unfav)
S/C Revenues: Budget Budgeted Actual Variance Explanation
Facilities Capacity Fees higher than budgeted due to payments
received from Avalon Bay new building-200 apartments and
$ 65,598,130 $ 30,018,720 $ 32,254,993 $ 2,236,273 commercial development. SSC Higher than budgeted.
Total $ 65,598,130 $ 30,018,720 $ 32,254,993 $ 2,236,273
Total FY YTD YTD YTD
S/C Expenses: Budget* Budgeted Actual Remaining %Spent of Projected YTD Budget
Total $ 74,669,521 $ 37,485,350 $ 34,554,831 $ 2,930,519 92.18%
Includes 18/19 carryover($8,493,521)
April 2, 2020 Regular Board Meeting Agenda Packet- Page 33 of 115
ATTACHMENT 2
CENTRAL CONTRA COSTA SANITARY DISTRICT
RUNNING EXPENSE FUND
TEMPORARY INVESTMENTS
FEBRUARY,2020
INVESTMENTS INTEREST INCOME
(cents omitted) (cents omitted)
DATE OF
Days to ANNUAL CASH B.O.M. PURCHASE E.O.M. E.O.M %of CURRENT B.O.M. E.O.M.
NO. ISSUER TYPE PURCHASE MATURITY Maturity YIELD OUTLAY FACE VALUE(MATURITY) FACE VALUE MKT VALUE Portfolio MONTH CUMULATIVE CUMULATIVE
519 State of Calif. LAIF 10/99- ------- 1 (1) $17,100,000 $23,100,000 ($6,000,000) $17,100,000 $17,216,298 43.73% $32,661 $189,354 $222,015
RE13 FHLB FED AGENCY 9/18/2019 3/20/2020 20 1.899% 3,962,178 4,000,000 4,000,000 4,076,858 10.23% 5,961 27,956 33,917
RE14 FHLB FED AGENCY 9/18/2019 3/18/2020 18 1.909% 3,962,387 4,000,000 4,000,000 3,957,307 10.23% 5,933 28,107 34,040
RE15 FHLB FED AGENCY 12/20/2019 3/6/2020 5 1.612% 13,952,688 14,000,000 14,000,000 13,997,620 35.81% 18,053 26,146 44,200
(3) $38,977,252 $45,100,000 ($6,000,000) $39,100,000 $39,248,084 100.00% 62,609 271,563 334,172
(2)
6,983 33,358 40,342
$69,592 $304,921 $374,513
NOTE:(1) Annual yield of Local Agency Investment Fund(LAIF)varies with the composition of the Fund.
The estimated yield as of February,2020 was 1.92%.
(2) The face value indicates the value of the investment if held until maturity,which is the usual District Practice.
(3) The weighted average yield of the total Running Expense portfolio is 1.7168%. The weighted average maturity is.15 years.
(4) The market value of the portfolio on February 29,2020 wa.,$39,248,084.
(5) All investments held by the Running Expense Fund comply with Central San's investment policy approved by the Board of DirectorsCalifornia Government Code§53646(b)(2)]
(6)Sufficient liquidity and anticipated revenues are available for Central San to meet budgeted expenditures of the Running Expense fund for the next six(6)months[California Government Code§53646(b)(3)]
(7)Of the total investments held in the Running Expense Fund, $1,610,000 is restricted for the Rate Stabilization Fund.
April 2, 2020 Regular Board Meeting Agenda Packet- Page 34 of 115
CENTRAL CONTRA COSTA SANITARY DISTRICT
SEWER CONSTRUCTION FUND
TEMPORARY INVESTMENTS
FEBRUARY,2020
INVESTMENTS INTEREST INCOME
(cents omitted) (cents omitted)
DATE OF Days to ANNUAL CASH B.O.M. PURCHASE E.O.M. E.O.M. %of CURRENT B.O.M. E.O.M.
NO. ISSUER TYPE PURCHASE MATURITY Maturity YIELD OUTLAY FACE VALUE (MATURITY) FACE VALUE MKT VALUE Portfolio MONTH CUMULATIVE CUMULATIVE
519 State of Calif. LAIF 8/86-2/90 ---- 1 (1) $34,000,000 $35,000,000 ($1,000,000) $34,000,000 $34,231,237 57.63% $53,234 $323,865 $377,099
949 FHLB Fed Agency 9/18/19 03/20/20 20 1.90 4,952,722 5,000,000 5,000,000 4,796,304 8.47% 7,451 34,944 42,396
950 FHLB Fed Agency 9/18/19 03/18/20 18 1.91 4,952,983 5,000,000 5,000,000 5,036,573 8.47% 7,492 35,133 42,625
951 FHLB Fed Agency 12/23/19 3/20/20 19 1.62 14,941,883 15,000,000 15,000,000 15,108,358 25.42% 19,152 26,417 45,569
(4) $58.847.589 $60.000.000 ($1,000.0001 $59.000.000 $59.172.471 100.00% 87,329 420,360 507,689
(3) (5)
8,912 226,892 235,804
96.241 $647.252 $743.492
NOTE: (1) Annual Yield of Local Agency Investment Fund(LAIF)varies with the composition of the Fund.
The estimated yield as of February,2020 was 1.920%.
(2) The face value indicates the value of the investment if held until maturity, which is the usual District practice.
(3) The weighted average yield of the total Sewer Construction portfolio is 1.8412%. The weighted average maturity is.11 years.
(4) The market value of the portfolio on February 29,2020 was$59,172,471.
GASB 31 requires adjusting investments to market value. The District will adjust annually,but report market values monthly.
(5) All investments held by the Sewer Construction Fund comply with Central San's investment policy approved by the Board of Directors[Ca/ifornia Government Code§53646(b)(2)]
(6)Sufficient liquidity and anticipated revenues are available for Central San to meet budgeted expenditures of the Sewer Construction fund for the next six(6)months[California Government Code§53646(b)(3)]
(7)Of the total investments held in the Sewer Construction Fund, $1,000,000 is restricted for the Rate Stabilization Fund.
April 2, 2020 Regular Board Meeting Agenda Packet- Page 35 of 115
CENTRAL CONTRA COSTA SANITARY DISTRICT
SELF-INSURANCE FUND
TEMPORARY INVESTMENTS
FEBRUARY,2020
INVESTMENTS INTEREST INCOME
(cents omitted) (cents omitted)
DATE OF
Days to ANNUAL CASH B.O.M. PURCHASE E.O.M. E.O.M %of CURRENT B.O.M. E.O.M.
NO. ISSUER TYPE PURCHASE MATURITY Maturity YIELD OUTLAY FACE VALUE(MATURITY) FACE VALUE MKT VALUE Portfolio MONTH CUMULATIVE CUMULATIVE
519 State of Calif. LAIF 10/99- ------- 1 (1) $6,900,000 $6,900,000 $6,900,000 $6,946,927 100.00% $10,525.81 $88,656.26 $99,182.07
(3) $6,900,000 $6,900,000 $0 $6,900,000 $6,946,927 100.00% 10,526 88,656 99,182
(2) (4)
2,921 2,351 5,272
$13,446.88 $91,007.53 $104,454.41
NOTE: (1) Annual yield of Local Agency Investment Fund(LAIF)varies with the composition of the Fund.
The estimated yield as of February,2020 was 1.920%.
(2) The face value indicates the value of the investment if held until maturity,which is the usual District Practice.
(3) The weighted average yield of the total Self-Insurance portfolio is 1.920%.
(4) The market value of the portfolio on February 29,2020 was$6,946,927.
(5) All investments held by the Self Insurance Fund comply with Central San's investment policy approved by the Board of DirectorsCalifornia Government Code§53646(b)(2)]
(6)Sufficient liquidity and anticipated revenues are available for Central San to meet budgeted expenditures of the Self Insurance fund for the next six(6)months[California Government Code§53646(b)(3)]
April 2, 2020 Regular Board Meeting Agenda Packet- Page 36 of 115