RANCHO SANTA FE — While the Santa Fe Irrigation District prepares to launch its 2014-15 budget July 1, staff members are fine-tuning their numbers for the board of directors June 19 for adoption consideration.
Jeanne Deaver, the district’s administrative services manager, said their budget goals have involved several factors.
“The board has passed a policy to adopt a balanced budget so that means that operating revenues equal operating expenses,” said Deaver, adding how that is definitely a main goal.
Others on the task list include covering their capital project expenditures for part of a fiscal year.
Then there are outside obligations.
“We currently have a debt service payment where the bond Covenant requires that we have a certain amount of revenue left over after our operating expenses in order to cover the debt service payment,” Deaver said.
Another element staff considers are some reserve funds that are being paid at a minimum balance per the district reserve funds policy.
The current proposed operating and capital budget, including the debt service payment, stands at $37.47 million. A breakdown of this consists of $23.1 million in operating costs; $13 million in capital projects; and, $1.3 million for debt service.
In total operating expenses, there is an intended contribution of $2.3 million for the Capital Improvement Reserve Fund (CIP).
For the second year in a row, there is a proposed “no rate increase” for customers.
“There is no rate increase included in the current version of the budget and we’re not planning to have one when it’s adopted in June,” Deaver said. “But we are going to be starting a cost-of-service study and that will be looking at our revenue requirements and potentially making recommendations relating to rates.”
Deaver was quick to point out that she did not know if that would include a rate increase.
A change in the 2014-2015 budget may be staff’s inability to pull $1 million from its Rate Stabilization Fund to the Capital Improvement Fund.
“It was a commitment the board had made to ask staff to set aside an additional million in addition to the 2.3 million that we already set aside,” she said.
As it stands, Deaver pointed out, staff will be unable to do this for two reasons.
By not initiating a rate increase for a second year, the Santa Fe Irrigation District’s budget has had to absorb additional cost increases from the San Diego County Water Authority and general inflationary prices.
“The other reason is that we are adding some money back into our budget that was taken out in the 2012 budget and was never added back in again,” Deaver said. She continued, “Those are programs that we have been deferring such as meter replacements and small pipe line replacement.”
Additionally, the recent declaration of water shortage conditions means that the Santa Fe Irrigation District must communicate with its customers through a public outreach and water conservation budget.
“We are trying to replenish some of those line items in our budget that were cut back in 2012 and restart some of the programs that we haven’t been doing,” she said.
One final item needed for the final proposed budget is San Diego County Water Authority’s exact number of their rate increase.
Deaver is expecting this number sometime in May, and then, they can update the budget with that figure.