CC 2014-01-14_08.c. Annual Financial Report 2012-13MEMORANDUM
TO: CITY COUNCIL
FROM: DEBBIE MALICOAT, DIRECTOR OF ADMINISTRATIVE SERVICES~
SUBJECT: CONSIDERATION OF ANNUAL FINANCIAL REPORT -FISCAL YEAR
2012-13 RECEIPT AND USE OF WATER AND SEWER CAPACITY AND
CONNECTION FEES/CHARGES
DATE: JANUARY 14, 2014
RECOMMENDATION:
It is recommended the City Council receive and file the annual report of the receipt and
use of water and sewer capacity and connection fees and charges, in compliance with
Government Code Section 66013.
IMPACT ON FINANCIAL AND PERSONNEL RESOURCES:
No outside funding is required.
. >
No or minimal future staff time is projected.
BACKGROUND:
Government Code Section 66013 requires a financial accounting of the transactions
dealing with water and sewer capacity and connection fees and charges (development
impact fees) shall be made available to the public.
The basic accounting and reporting responsibilities under the Government Code require
the following:
1; A description of the charges/fees deposited in the fund;
2. The beginning and ending balance of the fund and any interest earned from
investment of moneys in the fund;
3. The amount of charges/fees collected in the fiscal year;
4. The public improvements on which charges/fees were expended;
5. The percentage of the total cost of the public improvements that were funded by
these charges/fees;·
6. The completed public improvements on which charges/fees were expended;
7. Each public improvement that is anticipated to be undertaken in the current fiscal
year.
Attached to this staff report is the financial information (Attachment 1) as required by
Government Code Section 66013 as of June 30, 2013. The information consists of
beginning and ending fund balances for each fee charged by the City, including interest
Item 8.c. - Page 1
CITY COUNCIL
WATER AND SEWER DEVELOPMENT IMPACT FEES-ANNUAL REPORT
. JANUARY 14, 2014
PAGE2
earned and details of all expenditures made from these sources. The information
provided is consistent with the financial records. Pursuant to Government Code Section
66013, this report is for review purposes only.
ANALYSIS OF ISSUES:
The City utilizes fund accounting to segregate development related fees from other City
revenues. Although the City pools its cash for investment purposes, interest income is
allocated to the faCility funds based on their respective cash balances.
The City accounts for water and sewer connection and capacity fees or charges can be
found in three separate funds the Water Facility Fund, the Sewer Facility Fund, and the
Water Availability Fund. The information in Attachment A is presented in a format
consistent with the annual audit of the Fiscal Year from July 1, 2012 to June 30, 2013.
The following is a description of the City funds used to track water and sewer
connection and capacity fees and charges:
• Water Facility (Fund 642)
Water Main Charges, enacted pursuant to the provision of Section 13.04.050 of the
City Municipal Code, are accounted for in the Water Facility Fund. These revenues
are to be used for future water infrastructure improvements.
• Sewer Facility (Fund 634)
Sewer Connection fees, enacted pursuant to the provision of Section 13.12.190 et
seq. of the City Municipal Code, is collected to help pay for improvements and future
sewer system capacity as necessary to meet the needs of the City resulting from
growth and expansion.
e Water Availability Fund (Fund 241)
This fund is used to account for the accumulation of water availability charge
revenues. This charge was enacted pursuant to the provision of Section 387 43 of
the Government Code, and Section 13.04.040 of the City Municipal Code.
Due to the substantial reduction in development activity, new revenue in these funds
has decreased in recent years. This has required adjustments to projections for future
capital improvement projects.
ALTERNATIVES:
The following alternatives are provided for City Council consideration:
-Approve staff recommendation and accept the report;
Do not accept staff recommendation;
Modify staff recommendation and approve;
Provide direction to staff.
Item 8.c. - Page 2
CITY COUNCIL
WATER AND SEWER DEVELOPMENT IMPACT FEES-ANNUAL REPORT
JANUARY 14, 2014
PAGE3
ADVANTAGES:
By accepting the Water and Sewer Development Impact Fees-Annual Report, the City will
be complying with Government Code Sections 66013 et seq. which requires a financial
accounting of the transactions dealing with water and sewer capacity and connection
fees and charges (development impact fees) shall be made available to the public.
c
DISADVANTAGES:
There are no disadvantages in relation to the recommended action.
ENVIRONMENTAL REVIEW:
No environmental. review is required for this item.
PUBLIC NOTIFICATION AND COMMENTS:
The Agenda was posted in front of City Hall on Thursday, January 9, 2014. The
Agenda and report were posted on the City's website on Friday, January 10, 2014. No
public comments were received. ·
Attachment:
1. Statement of Fund Balances for Water and Sewer Development Fees and
Charges
Item 8.c. - Page 3
ATTACHMENT 1
CITY OF ARROYO GRANDE
Water and Sewer Development Fees and Charges
Statement of Revenues, Expenditures and Changes in Fund Balances
Fiscal Year Ended June 30, 2013
Sewer Water Water
Facility Facility Availability
Revenues:
Interest Income $ 1,371 $ 2,935 $ 6,916
Sewer Facility Charges 53,983
Water Main Charges 5,469
Distribution Charges 46,360
Water Availability Charges 51,850
Total Revenues 55,354 54,764 58,766
Expenditures
Operating Expenses
Excess of Operating Revenues Over
Operating Expenditures 55,354 54,764 58,766
Other Financing Uses
Capital Transfers Out (2,546) (528) (47,704)
(2,546) (528) (47,704)
Excess of Revenues Over
(Under) Expenditures and
Other Financing Uses 52,808 54,236 11,062
Fund Balance, Beginning of Year 331,370 724,319 1,733,516
Fund Balance, End of Year $ 384,178 $ 778,555 $ 1,744,578
Item 8.c. - Page 4
CITY OF ARROYO GRANDE
Water and Sewer Development Fees and Charges
Fiscal Year 2012-13 Completed Work
Lift Station No 3 Replacement
Total Capital Transfers
Fiscal Year 2013-14 Current Projects
N. Rena Sewer Relocation
Total Funding for Current Projects
Fiscal Year 2012-13 Completed Work
Reservoir No 6 Construction
Total Capital Transfers
Fiscal Year 2013-14 Current Projects
LePoint Area Main Upgrade
Leanna Drive Creek Crossing Upgrade
Reservior No 7 Construction
Total Funding for Current Projects
Fiscal Year 2012-13 Completed Work
Lopez Spillway Feasibility Study
Water Well No 11 Facilities
Total Capital Transfers
Fiscal Year 2013-14 Current Projects
Water Well No. 11 Facilities
Total Funding for Current Projects
Sewer Facility Transfers
Transfers
$ 2,546
$ 2,546
Transfers
$ 33,000
$ 33,000
Water Facility Transfers
Transfers
$ 528
$ 528
Transfers
342,050
175,800
377,600
$ 895,450
Water Availability Transfers
Transfers
3,977
43,727
$ 47,704
Transfers
221,797
$ 221,797
% of Project
1%
% of Project
50%
% of Project
0%
% of Project
50%
35%
43%
% of Project
12%
15%
% of Project
78%
ATTACHMENT 1
% Project is
Complete
100%
% Project is
Complete
100%
% Project is
Complete
100%
22%
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