09 - Preliminary FY 2013-14 Year-End Budget (4th Quarter Budget Report) Costa Mesa Sanitary District …an Independent Special District Protecting our community’s health and the environment by providing solid waste and sewer collection services. www.cmsdca.gov Memorandum To: Board of Directors From : Scott Carroll, General Manager Via: Wendy H. Davis , Interim Finance Manager Date: July 2 4 , 201 4 Subject: Preliminary FY 2013 -14 Year -End Budget (4th Quarter Budget Report) Summary Th is report serves as a summary of the District’s spending through June 30, 2014 as well as staff’s projected balances after the fiscal year -end close for June 30, 2014. Staff Recommendation That the Board of Directors receive and file this report. Analysis Based on the spendi ng trends through June 3 0 , 201 4 , staff is projecting small savings in both the Solid Waste and Liquid Waste Funds. As of June 3 0 , 201 4 , a total of 97 .5 % of the Solid Waste budget for the 2013 -2014 fiscal year has been expended . At this time, staff anti cipates a budgetary savings in both Personnel and Special Programs. The Solid Waste Fund is projected to have a fiscal year -end budget surplus balance of $7 3 ,640 . A total of 72 .8 % of the L iquid Waste Fund’s operating budget has been expended as of June 3 0 , 201 4 . Staff anticipates a budgetary saving s in Personnel costs due to vacancies , which is offset by greater than normal expenses in some of the M&O accounts. Several of the sewer maintenance contract accounts are projected to be under budget due work being performed by staff instead of contracted out. The Liquid Waste Fund currently reflects a projected fiscal year -end surplus budget of $427,14 2 .
Board of Directors July 2 4 , 201 4 Page 2 of 2 Please see the attached report for a more detail ed analysis. Strategic Plan Element & Goal This item s upports achieving the objective and strategy of Strategic Element No. 7.0, Finance , which states: “Objective: To ensure the short and long -term fiscal health of the District. Strategy: The District will forecast and plan revenue and expenditures and mai ntain appropriate reserves and investment to provide financial resources to fund current and planned operations and projects.” Legal Review Not applicable. Environmental Review Subject activity is exempt from the requirements of the California Environme ntal Quality Act (CEQA) (Public Resources Code Section 21000 et. seq.). Section 15300.4 of CEQA allows an agency while establishing its own procedures “to list those specific activities which fall within each of the exempt classes”, and the District has a dopted “CEQA Guidelines and Implementing Procedures” that state on page 6 “”Projects” does not include …. C. Continuing administrative or maintenance activities.” Financial Review See attached report. Public Notice Process Copies of this report are on fi le and will be included with the entire agenda packet for the July 2 4 , 201 4 Board of Directors regular meeting at District Headquarters and on District website. Alternative Actions 1. Refer the matter back to staff for additional information. Attachme nts A: FY 2013 -14 Fourth Quarter Budget Analysis
COSTA MESA SANITARY DISTRICT Preliminary 4th Q uarter Budget Update Fiscal Year 2013 -14 E XECUTIVE SUMMARY Attached is the fourth quarter budget analysis of the Solid and Liquid Waste Fund s operating budgets for fiscal year (FY) 2013 -14 . This analysis uses the “Amended Budget”, which consists of the adopted budget plus any prior year carryover appropriations , as well as budget adjustments approved through June 30 , 201 4 . The projections in this analysis are based on “Run -Rate” calculations unitizing historical trends for some accounts , while others are based on known or anticipated spe nding by staff. The Costa Mesa Sanitary District (District ) Solid Waste and Liquid Waste F unds are both Enterprise Funds . These funds are operated as independent business ventures sharing one Board of Directors. Some ex penses of the District are charged entirely to a specific fund , while other expenses may be allocated to both funds based on a percentage. For example, the costs a ssociated with the District’s Board of Directors will be split between the funds equally. However, the cost of the trash pickup will be charged only to the Solid Waste F und. Based on the attached Expenditure Analysis , both the Solid Waste and Liquid Waste Funds are projected to have a budget surplus at June 30 , 2014 as described below: S OLID W ASTE F UND The annual operating budget for the Solid Waste fund is $5,3 94 ,2 65 . The total year -to -date expenses are $5 ,258 ,625 , and staff estimates the total year -end balance will be $5,3 2 0 ,6 2 5 resulting in a projected surplus of $7 3 ,640 . This projected surplus results primarily from unexpended funds in the Special Programs. The following sections are intended to provide a summary of the more significant budget to actual changes anticipated by staff a t year -end : PERSONNEL The District had three vacant positions, the Finance Man a ger, the Permit Technician and a part -time Maintenance Worker which all provide services to both funds . T herefore , only a portion of their costs are charged to the Solid Waste F und. In April, the part -time Code Enforcement Officer resigned from his position to accept a full time position in the Costa Mesa Police Department . The Code Enforcement position was charged 100% to the Solid Waste Fund. A ll of t hese positions remain ed vaca nt until the end of the fiscal year, thus creating a substantial savings in the salary and benefit accounts. Additional ly , the District is realizing a savings in its “PERS Employee” account due to costs which w ere previously paid by the District , are now required to be paid by the employee for all new hires. The total projected savings in Personnel costs a t June 30, 2014 is $7 7 ,9 00 . M & O The M & O accounts are projected to exceed the amended budget by $4 6 ,260 . The following is a summary of expenses not included in the amended budget that are causing the variance: • Professional Services – This account is estimated to be over budget by $3 ,267 due to the BHI Consulting contract for teambuilding exercises, consultant services to perform the PERS actuarial r equired to be completed by June 30, 2014 , and the contract for the CMSD internet App. • Fiscal Services – T he projected overage in th is account of $1 5 ,3 00 is the result of the vacant Finance Man a ger duties , which are being contracted to CBIZ. These expenses are offset by the budget surplus in salaries and benefits.
COSTA MESA SANITARY DISTRICT Preliminary 4th Q uarter Budget Update Fiscal Year 2013 -14 • Contract Services – T h is account is projected to be under budget by $2,200 due to the transfer of $17,362 for the Household Hazard ous Waste (HHW) collection event to the HHW Speci al Programs budget. This savings was offset by t he contract cost for the vacant Permit Technician , which is being contracted to Wi l dan and Associates. These expenses are offset by the budget savings in the salary and benefits accounts. • Recycling/Disposal (CR&R) – This account is projected to be over budget by $41,00 0 due to higher than anticipated tonnage collected during the fiscal year . • Community Outreach – This account is projected to exceed the amended budget by $20,77 3 , due to unanticipated expenses for outreach for the organics recycling program. Board meetings and Town Hall meetings were held at rented offsite locations to accommodate an audience and necessitated the hiring of audio and video services. In addition, au tomated phone messages were used to notify the public of the Town Hall and Board meeting dates and locations. The quarterly newsletter was budget ed at 35% to the Solid Waste Fund . H owever , it was determined that a more appropriate allocation is 50%, whic h equates to an increase in expenses to this F und of $7,000. Additionally, Infosend was contracted to develop an organics program water bill insert. The Board approved advertising and booth sponsorships for Costa Mesa Community Run. SPECIAL PROGRAMS Th e Household Hazardous Waste collection program, the Anti -Scavenging program and the Telephone Book Recycling program are projected to come in substantially under budget , resulting in a budget surplus of $4 2 ,0 00 even after reprogramming resources toward the new Battery Recycling C ollection program. CAPITAL OUTLAY The capital outlay budget of $1,500 h as been fully expen d ed on the exterior maintenance at the District Headquarters.
COSTA MESA SANITARY DISTRICT Preliminary 4th Q uarter Budget Update Fiscal Year 2013 -14 LIQUID WASTE F UND The annua l operating budget for the Liquid Waste fund is $3 ,988 ,169 , excluding Capital Improvement Projects. The total year -to -date expenses are $2 ,901 ,545 . S taff estimates the total year -end balance to be $3 ,5 6 1 ,027 , for a projected surplus of $427,142 . This projected surplus is being generated from unexpended funds in Personnel and M & 0 . The following sections are intended to provide a summary of the more significant budget to actual changes anticipated by staff at year -end: PERSONNEL The District had three vacant positions, the Finance Manager , the Permit Technician and a part -time Maintenance Worker. All three of these positions provide services to both funds . T herefore, only a portion of their costs are charged to the Liquid Waste F und. The pr ojected expenses for FY 2013 -14 reflected that these positions remain ed vacant until the end of the fiscal year, thus creating a substantial savings in the salary and benefit accounts. Additional ly , the District is realizing a savings in its “PERS Employe e” account due to costs which were previously paid by the District , are now required to be paid by the employee for all new hires. The total projected savings in Personnel costs a t June 30, 2014 is $1 60 ,8 00 . M & O The M & O accounts are projected to be under the amended budget by $266 ,342 . The following is a summary of significant variances : • Professional Services – I ncluded in this account is the BHI Consulting contract for teambuilding exercises, consultant services to perform the PERS actuarial requi red to be completed by June 30, 2014 , and the contract for the CMSD internet App. The $40,000 internal parcel audit was not started during this fiscal year , which is keeping this account under budget by $36,034 . • Plan Checking/Inspections Services – The p rojected overage in this account of $10 ,000 is the result of increased participation the SLAP program and increase building activity within the City. A portion of this increase should be offset by increased revenues. • Fiscal Services – T he projected overa ge in this account of $52,7 00 is the result of the vacant Finance Manager duties , which are being contracted to CBIZ. These expenses are offset by the budget surplus in salaries and benefits. • Contract Services – T he projected overage of $15 ,2 00 in this a ccount is the result of the vacant Permit Technician duties , which are being contracted to Wildan and Associates. These expenses are offset by the budget savings in the salary and benefits accounts. • Pump Station Maintenance – This account is projected to be under budget by $25,000. Additional funds were transfer into this account to cover the cost of training provided by JIMNI to District staff who will assume the ongoing maintenance of the pump station’s electrical systems wh ich was projected to be $4 0,000 . The maintenance was performed during the training thereby creating a savings. • Sewer Line Maintenance – The $73 ,000 projected savings in this account is the result less line cleaning by National Plant needed than anticipat ed at the beginning of the fiscal year .
COSTA MESA SANITARY DISTRICT Preliminary 4th Q uarter Budget Update Fiscal Year 2013 -14 • GIS Maintenance – This activity was budgeted prior to the determination of the scope of work and contractual agreement established . T his account will exceed the budget by $19,0 00. • Televising Sewer Lines – T his activity has been un der budgeted in the current and prior fiscal years. Staff is projecting that this account will exceed the adopted budget of $5,000 by $2 4 ,5 00. Staff recommends increasing this budget is subsequent budget years. • Misc ellaneous Sewer Work – This activity is projected to be under budget by $124 ,517 based on the prior fiscal year actual and year to date expenses. Staff recommends reducing this budget in subsequent budget years. • Sewer Lateral Program – This activity is projected to be over budget by $75 ,000 until the Board of Directors approved an additional appropriation of $110,000 at the April 24, 2014 Board meeting. Any funds remaining at the end of the fiscal year will be carried over into the new year, therefore the account is shown as fully expended. • Community Outreach – This account is projected to be under the amended budgeted amount by $15,806 due mainly to the change in the split between funds for the quarterly newsletter expenses. Th e quarterly newsletter was budgeted at 65% to the Liquid Waste Fund. However, it was determined that a more appropriate allocation is 50%, which represents a decrease in expenses to this fund of $7,000. This account included the unanticipated expenses fo r outreach such as Board meetings and Town Hall meetings which were held at rented offsite locations to accommodate an audience and necessitated the hiring of audio and video services. In addition, automated phone messages were used to notify the public o f Town Hall and Board meeting dates and locations. The Board approved the advertising and booth sponsorships for Costa Mesa Community Run. • Small Tools/Equipment – T he unanticipated need to purchase safety and gas monitoring equipment for Sewer staff was not budgeted , resulting in this account exceeding the budget by $9,120 . • Professional Development/Training – The estimated $12,940 budget ary savings in this account is mainly the result of less attendance by the Board of Directors at budgeted conferences. CAPITAL OUTLAY The capital outlay budget of $631 ,827 is shown as fully expen d ed by June 30, 2014 . The capital equipment outlay as of June 30 , 2014 included the purchase of a Utility Crane Truck, Smart Covers, Manhole rings and covers. The remaining funds for the purchase of the ¾ ton truck and portable generators will carried over and purchased in the new fiscal year.
COSTA MESA SANITARY DISTRICT Preliminary 4th Q uarter Budget Update Fiscal Year 2013 -14 CAPITAL IMPROVEMENT PROJECTS The status of the capital improvement projects as of June 3 0 , 2014 is shown below. All unspent funds remaining at the end of the fiscal year will be carried over into the new fiscal year. Adopted Approved 10/24/13 Budget Amended Total Available Budget FY 12-13 Adjustment Budget Expenses Balance FY13-14 Carryovers as of 6/30/14 FY13-14 as of 6/30/14 as of 6/30/14 200601 Westside Pump Stn Abandonment #101 400,000 1,741,625 - 2,141,625 43,511 2,098,114 201293 Seismic Refurbish #193 - 34,175 - 34,175 20,238 13,937 201296 Pump Stn Emergency Equipmt #196 - 1,030,899 - 1,030,899 729,848 301,051 201297 System Wide Swr Recon Ph 3 #197 - 670,000 - 670,000 259,328 410,672 201298 PICA Analysis #198 - 176,185 (173,000) 3,185 2,557 628 201299 Fairview Trunk #199 - - - - - - 201300 Force Main Upgrades #200 850,000 - 180,868 1,030,868 109,847 921,021 201301 Replace Equipment at Pump Stn #201 260,000 - - 260,000 85,219 174,781 201302 Elden Pump Stn Valve/Repipe #202 150,000 - - 150,000 10,567 139,433 201303 Generator at District Yard #203 150,000 - - 150,000 5,122 144,878 201304 Manhole Cover Repairs #204 - - 100,000 100,000 9,119 90,881 201305 Gr 4 CCTV Improvements Ph 1 #305 - - - - 2,557 (2,557) 1,810,000 3,652,884 107,868 5,570,752 1,277,914 4,292,838
Through 6/30/2014 -Full Year--Full Year--Full Year-OriginalWorking Run-RateFinanceFinance BUDGETBUDGETYTDYTDYTD 12-13 toPercentFull YearProjectionFinanceProjectedProj. %as of July 1'13-'146/30/20146/30/2013YTD 13-14Change'12-'13Full YearProjections Balance 1 Remaining EXPENDITURES Personnel SALARIES FULL-TIME335,200341,400302,436245,45856,97723%245,458302,436305,00036,400 11%SALARIES PART-TIME34,30034,30021,07326,639(5,566)-21%26,63921,07324,00010,300 30%SALARIES BOARD14,40014,40013,87911,7132,16618%11,71313,87914,000400 3%OVERTIME8008003452935218%293345400400 50%Benefits132,700134,20093,96880,95913,00916%80,95993,968103,80030,400 23%Sub-Total Personnel 517,400525,100431,701365,06366,63818%365,063431,701447,20077,90015%M & O PROFESSIONAL SERVICES 36,73336,73336,54634,2932,2537%34,29336,54640,000(3,267) -9%DISTRICT MANAGER 000000%000 LEGAL SERVICES 47,25047,25029,68830,880(1,192)-4%30,88029,68830,00017,250 37%FISCAL SERVICES 14,70014,70023,65311,94311,71098%11,94323,65330,000(15,300) -104%MEDICAL/EMPLOY SERVICES 2002003122842910%284312400(200) -100%CONTRACT SERVICES 32,20032,20023,6534,72418,929401%4,72423,65330,0002,200 7%COUNTY COLLECTION FEE 15,70015,7005,8591865,6733047%1865,85915,700- 0%TRASH HAULER (CR&R)2,370,0002,370,0002,356,1752,169,042187,1339%2,169,0422,356,1752,357,00013,000 1%RECYCLING/DISPOSAL (CR&R)2,081,0002,081,0002,121,2951,925,392195,90310%1,925,3922,121,2952,122,000(41,000) -2%CONTAINER COLLECTION COST 13,50013,50010,74410,665801%10,66510,74413,500- 0%ELECTIONS 00019,889(19,889)-100%19,88900- 0%MAINTENANCE 7,5407,5406,0075,6553526%5,6556,0077,48060 1%OFFICE SUPPLIES 800800502692(191)-28%692502800- 0%MISC COPY 20020025280(255)-91%28025200- 0%POSTAGE 3,5003002899,665(9,376)-97%9,665289300- 0%COMMUNITY OUTREACH 16,77721,22741,41222,35019,06285%22,35041,41242,000(20,773) -98%SMALL TOOLS/EQUIP 70701143777209%37114200(130) -186%EOC EQUIP SUPPLIES 40040012201220%0122200200 50%PROF DEVELOPMENT/TRAINING 26,39026,39025,07713,57111,50685%13,57125,07725,3001,090 4%LIABILITY INSURANCE 6,5006,5005,6276,508(881)-14%6,5085,6275,700800 12%TELEPHONE 7007001,09973336750%7331,0991,100(400) -57%UTILITIES - BLDG 1,1501,150904865395%865904940210 18%ASSET REPLACEMENT 30,00030,00022,5003,22519,275598%3,22522,50030,000- 0%CONTINGENCY 000000%000- 0%TRANSFER OUT 000000%000- 0%Sub-Total M & O 4,705,3104,706,5604,711,6034,270,878440,72510%4,270,8784,711,6034,752,820(46,260)-1%- 0%Capital Outlay EQUIPMENT1,5001,5001,9123,495 (1,584)-45%3,495 1,9121,500 - 0%Sub-Total Capital Outlay 1,5001,5001,9123,495(1,584)-45%3,4951,9121,500 - 0%Special Programs SHARPS PROGRAM 10,20010,2006,7507,745(995)-13%7,7456,7506,7503,450 34%HHW 50,00048,75022,9868,76014,226162%8,76022,98623,00025,750 53%TELEPHONE BK RECYCLING 10,0002,5002,5007,300(4,800)-66%7,3002,5002,500- 0%ANTI-SCAVENGING 9,8009,8000000%0009,800 100%USED TIRE ROUNDUP 000000%000- 0%EDUCATIONAL TOURS 40,90040,90037,0348,56328,471332%8,56337,03438,0002,900 7%PHARMACEUTICAL 10,00010,0009,8437,8791,96425%7,8799,8439,900100 1%COMPOST GRANT 31,45531,45529,62236,851(7,229)-20%36,85129,62231,4550 0%BATTERY RECYCLING 07,5004,67504,6750%04,6757,500- 0%Sub-Total Special Programs 162,355161,105113,41077,09836,31247%77,098113,410119,10542,00026%TOTAL EXPENDITURES5,386,565 $ 5,394,265 $ 5,258,625 $ 4,716,535 $ 542,090 $ 11%4,716,535 $ 5,258,625 $ 5,320,625 $ 73,640 $ 1%Notes % change from last year ==>>11%13%1 Finance Projections reflect the most recent quarterly update 07/18/14 7:16 10-000000 Solid Waste Expenditure Analysis ExpendituresChange
Through 6/30/2014 -Full Year--Full Year--Full Year-OriginalWorking Run-RateAnalystAnalyst BUDGETBUDGETYTDYTDYTD 12-13 toPercentFull YearProjectionFinanceProjectedProj. %as of July 1'13-'146/30/20146/30/2013YTD 13-14Change'12-'13Full YearProjections Balance 1 Remaining EXPENDITURES Personnel SALARIES FULL-TIME686,700690,900592,381566,64825,7335%566,648592,381605,00085,900 12%SALARIES PART-TIME7,5007,5006,1168,293(2,177)-26%8,2936,1166,5001,000 13%SALARIES BOARD57,30057,30055,51546,8528,66318%46,85255,51555,6001,700 3%OVERTIME27,90036,60026,78818,3398,44946%18,33926,78828,0008,600 23%Benefits298,300299,200222,463218,4104,0532%218,410222,463235,60063,600 21%Sub-Total Personnel 1,077,7001,091,500903,263858,54144,7225%858,541903,263930,700160,80015%M & O PROFESSIONAL SERVICES 169,340166,03495,546138,933(43,387)-31%138,93395,546130,00036,034 22%DISTRICT MANAGER 000000%000- 0%LEGAL SERVICES 87,75087,75065,23981,430(16,190)-20%81,43065,23966,00021,750 25%ENGINEERING/ARCHIT SERV 90,00090,00054,30051,5432,7575%51,54354,30055,00035,000 39%PLAN CHECK/INSPECTIONS 112,000112,000121,813119,8211,9922%119,821121,813122,000(10,000) -9%FISCAL SERVICES 27,30027,30063,60822,18241,426187%22,18263,60880,000(52,700) -193%MEDICAL/EMPLOY SERVICES 1,8001,8002,1351,75438222%1,7542,1352,200(400) -22%CONTRACT SERVICES 78,80078,80091,52616,13175,395467%16,13191,52694,000(15,200) -19%SEWER MAINTENCE CLAIMS 000000%000- 0%COUNTY COLLECTION FEE 15,50015,50001,676(1,676)-100%1,676015,300200 1%PUMP STN MAINT CONTRACT 80,000115,00088,83921,42867,411315%21,42888,83990,00025,000 22%SEWER LINE MAINTENANCE 200,000200,000126,660127,352(692)-1%127,352126,660127,00073,000 37%ELECTIONS 00019,889(19,889)-100%19,88900- 0%BLDG MAINTENANCE 36,27036,27026,64238,104(11,462)-30%38,10426,64228,0008,270 23%EQUIP MAINTENANCE 84,84084,84070,18259,92610,25617%59,92670,18275,0009,840 12%GIS MAINTENANCE 20,00020,00036,22719,94916,27882%19,94936,22739,000(19,000) -95%TELEVISING SEWER LINES 5,0005,00029,21914,12815,091107%14,12829,21929,500(24,500) -490%MISC SEWER WORK 220,000209,51781,030183,361(102,331)-56%183,36181,03085,000124,517 59%FOG PROGRAM 104,000104,00092,50190,7651,7362%90,76592,501104,000- 0%RESIDENT FOG PROGRAM 000000%000- 0%SEWER LATERAL PROGRAM 200,000310,000244,324223,52320,8029%223,523244,324310,000- 0%INFLOW REDUCTION PROGRAM 10,00010,0001771,644(1,467)-89%1,6441772009,800 98%OFFICE SUPPLIES 9,2009,2003,6506,796(3,146)-46%6,7963,6504,5004,700 51%MISC COPY 1,8001,8004481,514(1,067)-70%1,5144485001,300 72%POSTAGE 31,5003,5002,96313,035(10,072)-77%13,0352,9633,000500 14%COMMUNITY OUTREACH 27,00060,80642,71630,15812,55842%30,15842,71645,00015,806 26%SMALL TOOLS/EQUIP 8,6808,68017,6363,79913,837364%3,79917,63617,800(9,120) -105%MAINT MATERIAL/SUPPLIES 25,00025,00022,18917,2154,97329%17,21522,18923,0002,000 8%EOC EQPT & SUPPLIES 3,6003,6003,65813,599(9,941)-73%13,5993,6583,700(100) -3%PROF DEVELOPMENT/TRAINING 122,440122,44086,78966,19620,59231%66,19686,789109,50012,940 11%LIABILITY INSURANCE 69,50069,50057,39168,912(11,521)-17%68,91257,39158,00011,500 17%TELEPHONE 11,80011,80014,0759,2754,79952%9,27514,07514,500(2,700) -23%UTILITIES 17,25017,25013,92013,6083122%13,60813,92014,8002,450 14%WATER PUMP MAINTENANCE 2,0002,0001,6341,30632825%1,3061,6342,000- 0%ELECTRIC PUMP MAINTENANCE 80,00080,00071,17361,3389,83516%61,33871,17375,0005,000 6%ASSET REPLACEMENT 175,000175,000131,25033,17598,075296%33,175131,250175,000- 0%CONTINGENCY 33,4304550000%000455 100%Sub-Total M & O 2,160,8002,264,8421,759,4581,573,463185,99512%1,573,4631,759,4581,998,500266,34212%Capital Outlay EQUIPMENT13,50019,94017,20531,358(14,154)-45%31,35817,20519,940- 0%EQUIPMENT 326,000611,887221,619495,279(273,660)-55%495,279221,619611,887- 0%Sub-Total Capital Outlay 339,500631,827238,824526,638(287,814)-55%526,638238,824631,8270 0%TOTAL EXPENDITURES3,578,000 $ 3,988,169 $ 2,901,545 $ 2,958,642 $ (57,097)$ -2%2,958,642 $ 2,901,545 $ 3,561,027 $ 427,142 $ 11%Notes % change from last year ==>>-2%20%1 Finance Projections reflect the most recent quarterly update 07/18/14 7:16 20-000000 Liquid Waste Expenditure Analysis ExpendituresChange