HomeMy WebLinkAbout17.b. Committee Minutes-Finance 05-21-2024Item 17.b.
J une 6, 2024
T O: HO NO R A B L E B O A R D O F D I R E C TO R S
F RO M :K AT I E YO UNG, S E C R E TA RY O F T HE D I S T R I C T
S UB J E C T: MAY 21, 2024 - F I NA NC E C O MMI T T E E - P R E S I D E NT L A UR I T Z E N A ND
ME MB E R P I L E C K I
Attached are minutes of the above C ommittee meeting.
AT TAC HM E NT S :
D escription
1. F I NA NC E Committee minutes 05-21-24
June 6, 2024 Regular Board Meeting Agenda Packet - Page 213 of 231
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REGULAR MEETING OF THE
CENTRAL CONTRA COSTA
SANITARY DISTRICT
FINANCE COMMITTEE
M I N U T E S
Tuesday, May 21, 2024
2:30 p.m.
Committee:
Chair Mariah Lauritzen
Member Tad Pilecki
Staff:
Roger S. Bailey, General Manager (arrived during Item 3.b.)
Greg Norby, Deputy GM – Engineering & Operations
Philip Leiber, Deputy GM – Administration
Benjamin Johnson, Internal Auditor
Danea Gemmell, Planning and Development Services Division Manager (left after Item
3.d.)
Edgar Lopez, Capital Projects Division Manager
Kevin Mizuno, Finance Manager
Thomas Brightbill, Senior Engineer (arrived during Item 3.a.) (left after Item 3.d.)
Christopher Thomas, Accounting Supervisor
Diana Diaz, Accounting Supervisor
Amal Lyon, Management Analyst (joined during Item 3.a.)
Laci Kolc, Risk Management Specialist
Stacey Durocher, Administrative Services Assistant
1. Call Meeting to Order
Chair Lauritzen called the meeting to order at 2:30 p.m.
2. Public Comments
None.
BOARD OF DIRECTORS:
MARIAH N. LAURITZEN
President
MICHAEL R. MCGILL
President Pro Tem
BARBARA D. HOCKETT
TAD J. PILECKI
FLORENCE T. WEDINGTON
PHONE: (925) 228-9500
FAX: (925) 372-0192
www.centralsan.org
June 6, 2024 Regular Board Meeting Agenda Packet - Page 214 of 231
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Finance Committee Minutes
May 21, 2024
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3. Items for Committee Recommendation to the Board
a. Review and recommend approval of expenditures incurred April 5, 2024,
through May 9, 2024
Staff responded to questions about expenditures posed in advance of the
meeting by Member Pilecki. The following items were discussed:
Check #312224, Hearst Communications Inc, $25,000
Mr. Leiber stated that this expense was for an event that the
Communications group participated in. This event provides staff information
about modes of communication and media Central San’s customers use
most heavily, which is helpful for developing effective customer outreach
approaches.
Procurement-Card (P-card) Expenditures:
The California Water Environment Association (CWEA) Event was in
February 2024. In response to Chair Lauritzen’s question asking why a
charge from February was included in the April 2024 through May 9, 2024,
expenditures, Mr. Mizuno stated that it was due to the timing of the P-card
statements and payment, as p-card statements are generally paid 60 days
after the statement end-date, which is typically the 22nd of each month.
The Committee had no further questions.
COMMITTEE ACTION: Recommended Board approval.
b. Receive Budget-to-Actual Expenditure overview through the month of April
2024
Mr. Mizuno provided an overview of the presentation included in the agenda
materials.
Operations & Maintenace Fund (O&M)
Total year-to-date expenditures through April 2024 were $70.9 million and
were lower than the year-to-date budget estimate of $76.6 million generating
a $5.7 million or eight percent variance. It is anticipated that the variance will
tighten by the end of the fiscal year generating a favorable spending
variance of approximately $2 million or 2.2 percent per current year spend
projections included in the FY 2024-25 proposed budget. Mr. Mizuno stated
that two main contributors to this variance pertained to underspending on
salaries, wages and benefits, as well as an approximate six percent vacancy
factor.
June 6, 2024 Regular Board Meeting Agenda Packet - Page 215 of 231
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Finance Committee Minutes
May 21, 2024
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Sewer Construction Fund (SCF)
Total expenditures through April 2024 were $58.3 million and were less than
the year-to-date target amount of $91 million. The actual spending projection
for the end of the current Fiscal Year (FY) was approximately $85.5 million
and is slightly less than the proposed 2024-25 FY Budget amount of $92.1
million.
COMMITTEE ACTION: Recommended Board receipt.
c. Receive Quarterly Financial Review for quarter ending March 31, 2024
Mr. Mizuno provided an overview of the presentation included in the agenda
materials.
O&M:
The O&M fund has a negative revenue variance of approximately -$505,088
or -1.3 percent largely due to timing and a negative variance in sewer service
charges.
Sewer Construction (SC) Fund:
The SC fund has a year-to-date negative revenue variance attributable to
sewer service charges revenue in the amount of -$1.7 million, which like
O&M, is also due to timing issues. The proposed budget for FY 2024-25
assumes Central San will close the FY with a total of $50.23 million in sewer
service charges revenue compared to the adopted budget of $50.25 million.
Both funds are expected to recover by the end of the current Fiscal Year
(FY).
This fund also reported a year-to-date negative variance in secured property
tax revenues in the amount of $4.6 million due to the timing of debt service
payments in the debt service fund, which are secured entirely by property tax
revenue. Payments are made in August, September, February, and March of
the fiscal year. In response to a question posed by Chair Lauritzen regarding
the negative variance in March, Mr. Mizuno stated that this obligation was
paid in March and will be reflected in the April report. The proposed FY
2024-25 budget projects this revenue source will close with a favorable
variance in the amount of $14.7 million compared to the adopted FY 2023-24
budget of $14.3 million. Any amounts collected above and beyond debt
service expenditures will remain in the SC fund.
COMMITTEE ACTION: Recommended Board receipt.
d. Review draft Position Paper to conduct a public hearing on June 6, 2024, to
receive public comment and consider adopting Ordinance No. ___ amending
District Code Sections 6.12.040, 10.04.020, 10.04.030, and 10.32.035
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Finance Committee Minutes
May 21, 2024
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Mr. Brightbill provided an overview of the draft Position Paper included in the
agenda materials.
District Code, Section 6.12.040 – Capacity Fee Program (Residential
Capacity Fees)
Due to Senate Bill 477, the California Government Code was updated on
March 25, 2024, relating to section numbering for Accessory Dwelling Units
(ADU’s). Modifications to the District’s Code are necessary to align with the
updates.
District Code Section 10.04.020 and 10.04.030 – Source Control
(Pretreatment) (Definitions and Abbreviations)
Add a definition for the Cross-media Electronic Reporting Rule (CROMERR)
to the District Code.
District Code Section 10.32.035 – Source Control (Pretreatment)
(Interceptor/Trap Maintenance Standards).
Revisions to this section include the following:
1) Extending a requirement for accumulated grease and solid waste to
include traps.
2) Deletes a requirement for traps to be cleared at least once every 90 days.
COMMITTEE ACTION: Recommended the Board set the public hearing
for June 6, 2024, at 2:30 p.m. to consider adopting Ordinance No. ___
amending District Code Sections 6.12.040, 10.04.020, 10.04.030, and
10.32.035.
4. Other Items
a. Receive Highmark Other Post-Employment Benefits (OPEB) and Pension
Prefunding Sub-Trust Reports for the first Quarter of calendar year 2024
Mr. Leiber provided an overview of the presentation included in the agenda
materials. He stated that the OPEB and Pension trusts both had positive
returns. Both funds are progressing well and are above the estimated target.
It was noted that Highmark has merged with PFM Asset Management
(PFMAM), and future reports will look slightly different.
Member Pilecki mentioned that the outlook on four of the asset funds on
Page 10 in the PDF, Investment Strategy Overview are showing more
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Finance Committee Minutes
May 21, 2024
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pessimistic than in the previous report. Mr. Leiber agreed and stated that
PFMAM is not seeing a better place to put the District’s funds at this time.
COMMITTEE ACTION: Received the reports.
b. Review Risk Management Loss Control Report as of May 7, 2024
Ms. Kolc provided an overview of the report included in the agenda
materials. She stated that no new claims were reported as of the date of this
report.
Ms. Kolc also mentioned that the verdict is pending regarding the Kappel
matter.
COMMITTEE ACTION: Received the report.
5. Announcements
Mr. Bailey announced two presentations on Nutrients:
1). The Taxpayer’s Association on May 24, 2024
2). San Ramon Chamber of Commerce that occurred on May 17, 2024.
6. Suggestions for Future Agenda Items
a. Receive list of upcoming agenda items and provide suggestions for any
other future agenda items.
Member Pilecki requested a walkthrough of the ongoing construction
projects at the treatment plant.
COMMITTEE ACTION: Received the list and provided input to staff.
7. Future Scheduled Meetings
Tuesday, June 25, 2024 at 2:30 p.m.
Tuesday, July 23, 2024 at 2:30 p.m.
Tuesday, August 27, 2024 at 2:30 p.m.
8. Adjournment – at 3:12 p.m.
June 6, 2024 Regular Board Meeting Agenda Packet - Page 218 of 231
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