MANAGER'S REPORT
01/13/2021
Budget Position Report
Operational income for December was about $71,020. Operational expenses were about $54,057. We took in $16,963 more than we spent.
Due to the late arrival of the county reports I was unable to include the budget summary.
We made interfund transfers from the 401 (Regular Maintenance) Fund totaling $8,971: $4,200 to 404 (payment to USDA) Fund; and $4,771 to the 403 (Capital Asset Replacement) Fund. So the 401 Fund seems to have higher expenses. But that money stays within the district. It is not cash out the door.
The year is somewhat interesting. We did well in terms of operational expenses vs revenues. Our revenues for 2020 were $912,882, not including interest income or General Facilities income. Operational expenses were about $686,485.
So, operationally, we spent about $226,397 less than we took in. However. That is not the entire story.
There was non-operational income (Late fees prior to March, interest income, and General Facilities income) totaling $61,478.
There is the matter of Capital Expenditures. We had two big, unanticipated expenses in 2020: the main replacement west of Aberdeen Lake Road; and the Well #5 pump replacement. We also made the payments to USDA totaling $50,395. Those three expenditures total $353,984.
Total cash in the door from all sources was $974,360. Total expenditures, cash out the door, was $1,040,469.
So 2020 finished in the red about $66,109. While it is never good, and is unsustainable, to experience a deficit, I am not displeased with that number, considering we were subject to over $300,000 in unbudgeted capital expenses. The good news is that we had the reserves to cover those expenses.
For 2021 I have tweaked the budget a bit based on information developed from experience in 2020. I have included an updated 5 Year Budget Comparison for the 401 Fund in your packets. We may need a resolution reflecting the changes.
I have projected a larger increase in revenue based on 2020 income. Salaries & Wages was adjusted based on the actual adopted rates. Benefits increased with the addition of the retirement program. Telephone, which included all telephone and internet costs, has been split up. For 2021 we can track office telephone/internet (a package), cell phone costs, and SCADA internet costs separately.
The report shows zero gain/loss for 2021 because the projected operational gain is transferred to the Major Repair Reserve Fund.
The large loss shown on this report for 2020 includes the interfund transfer from the 401 Fund to the 405 Major Repair Fund to establish that fund. Keep in mind that interfund transfers show as an expense to the fund from which the money is transferred and revenue for the fund into which the money is deposited. So interfund transfers do not reflect cash going out the door. It is just moved from one pocket to another. In years past we did not have a separate reserve for major, unanticipated repairs.
Treasurer’s Report:
The Treasurer’s Report is still off by $9.00. In order to find this I need an extended period of time without interruptions. That just doesn’t happen.
Fund Balances To Date:
Regular Maintenance $62,919
Capital Replacement $57,251
Major Repair Reserve $257,129
General Facilities $141,104
Total Funds Available $518,403
A decrease of $131,631 over the beginning of the year. A decrease, but, considering over $300,000 in unbudgeted expenses, not a major cause for concern. Provided, of course, that we can recover in upcoming years.
Billing/Collections
Billing for December was $60,183.05. Utility payments, including credit card payments, received in December were $64,964.01, 108% of the billing. Which means we collected on some past due accounts.
Section 1 billing, January 1st, was $82,839.30.
State Auditor
We are finally going to get the three year audit. Initial meeting scheduled is for 1/12. The audit is to commence on 1/21. The SAO is going to try and conduct the audit remotely using emailed documents.
That was tried once before without a great deal of success.
Water Rights
In accordance with commissioners’ discussions at a previous meeting, I have given Northwest Water Systems, Inc. the go ahead on the water right application process.
No action, beyond signing the contract, has occurred yet.
In 2020 we used 69.3% of our available water right.
Payroll Report
Pretty typical. The amount of overtime is starting to decline because the switch from the radios to internet SCADA communications has reduced the number of after-hours calls due to SCADA communications failures.
Pandemic
The office is still closed to the public but fully staffed. Phase 3 allows government offices to open subject to restrictions.
There is no practical way to meet the requirements for Phase 3 in order to open the office to the public.
The governor is implementing a new program. I don’t know the parameters yet.
Isolation Valves
I think we have the process for getting the valves on the base drawing worked out with JWM&A.
It is a bit involved getting the information from the field, to me, and then off to JWM&A. They add it to the base drawing and send a draft drawing of the intersection back to us. We review the draft and indicate any needed corrections.
The final version is emailed back to us in .pdf format. We print it out and include it in the notebook. So far we have exactly one drawing in the notebook. It will pick up. The hold up has been developing a process that gets the necessary information on the drawing while keeping the cost down.
We are finding a lot of paved-over or buried isolation valves. Raising additional paved-over valves will have to wait until Lakeside opens back up in the Spring. But we will know where they are and can knock out quite a few in a day or two.
Damaged Fire Hydrant
Hydrant #115 on Grange Road was hit by a car. It was hit-and-run with no witnesses stepping forward yet. I have referred the incident to the Water Sewer Risk Management Pool (our insurance carrier).
Well #5 Source Meter
American Pump has been given the go-ahead.
North Bank Reservoir
We should have had the roof stripped and re-sealed this past Summer. With the main replacement and the well pump there were just too many other things going on.
This needs to be done.
I have started the process of getting this scheduled for Summer.
On a recent tour of the system I noted that there is a new crack on this reservoir that has me concerned. It extends about 1/3 of the way around the tank. For most of it’s length it is completely through, as indicated by mineral deposits. I have emailed photos to you.
I am in discussions with JWM&A regarding this development. We are in agreement that, at the moment, it is not a cause for concern.
In any event, this indicates that we need to schedule tank cleaning/inspection at an early date. We are past due for the routine cleaning anyway. I will have contacted LiquiVision but don’t have a date yet.
Ashley & Kayla
The water main in this area is 6” AC, which appears to be in serviceable condition. We will be working on replacement of the nylon service lateral fittings into the Summer schedule. I am sure there are leaks there that have not yet surfaced. We should be able to do all this work in-house.
The service lateral piping is good quality HDPE, so just the fittings need to be replaced.
Hydrant Maintenance
No hydrant flushing got done in December. We are still behind in tagging and painting. See “Maintenance Activity” below.
Rate Study
It will take some time to update the Rate Study to reflect lessons learned in 2020. I expect to have an updated version ready for the February meeting.
Obviously, we will not be getting down to serious work on 2022 rates until at least July, but keeping this up to date is an ongoing project.
Shop Fence
No progress on this project yet. This will take some discussions with the fire district as the 50-foot strip of fire district-owned property to the west presents some challenges as to where the fence should be located.
New Regulations
The County has delayed the implementation of their new process for Claims Requests. They are installing a whole new accounting system. I am very glad that I have no part in that process.
I have requested an early copy of the spreadsheet we will be required to use to see if Bias can craft a report that will meet the County’s needs. I would prefer to avoid having to enter the data manually.
The governor’s ban on in-person public meetings is a new requirement to us. It is unclear to me when this went into effect, but it is certainly in effect now. In theory, the current set of decrees expires on January 6th. My bet is that they will be extended. Bet called...extended one week, but with the implementation of a new plan.
Unless everyone is Zoom-capable (which is probably not the case), we will need to set up conference call meetings until further notice. We will need to provide some means of public input.
The State Auditor has made some changes to the BARS manual. I have skimmed through the pages and I don’t see anything that pertains to water/sewer districts. But I need to go through it in detail. Our accounting practices are now BARS compliant. I would like to keep it that way.
Recurring SCADA Power/Communications Problems
I thought this was a dead issue and was going to drop it from the report. It has become a minor issue, but is not quite dead. It turns out that from time to time the internet goes down in the middle of the night, apparently for maintenance.
It is not a major issue, but we do need to keep an eye on it.
Having passed on this bit of information, I will drop this topic from the report unless something significant occurs.
Personnel
No news. Which is good news. Our stable, well trained, dedicated staff continues to get done what needs to get done.
The one area we struggle with is the lack of depth in the office staff. With no backup for the district clerk, when she is not here customer service suffers.
I take care of any immediately important issues, but I have my own work to accomplish.
Maintenance Activity:
We are not keeping up. It is not for a lack of trying. Everyone is working smart, hard, and long. The maintenance tasks just keep piling up. Though eliminating the SCADA radio communications has cut down on after hours calls considerably.
A recent Manager’s Tour turned up the following items that need to be addressed:
General clean up around the North Bank Reservoir
Install lock box at the Hirschbeck Heights Booster Station (Reg)
Remove personal items from the Shop
Shop need organization, tools need to be put away.
Garage floor needs sweeping
Pumphouse
Discard old gate
Fill in crane-pad depression near stairs
Put tools away
General clean up
Install Well #6 flushing valve
Repair floor
Install Well #6 roof hatch (Reg/Contractor)
Most of these will have been addressed by the time you read this.
The requirement for weekly coliform samples (as opposed to monthly, which is what was previously required) has added some to our work load. It isn’t huge, but it is one more thing to schedule, do, and track.
You will note quite a bit of flushing. Line flushing is vital to maintaining delivered water quality, particularly on dead end lines. We try and work this in with hydrant maintenance, but flushing the dead end lines has first priority.
Roads
We have two access roads that are ongoing headaches. The North Bank Reservoir access road and the Clemons Reservoir access road are both steep and, when maintained, gravel. They are constant maintenance problems. Every time we drive up there we end up digging holes in the gravel. The recent heavy rains have really made these roads a mess. At North Bank a considerable amount of gravel got washed down into a neighbor’s yard.
I don’t know when yet, but we really need to consider paving those roads. It obviously won’t be until Lakeside opens up in the Spring. It needs to be done. I can easily visualize a number of scenarios in which we need to get equipment to a reservoir and are barred from doing so by the condition of the access roads.
Contractor Repairs/Assistance
Replace Fire Hydrant #115 on Grange Road. Hit by a car. Insurance should cover part of this cost.
Tank Cleaning
Scheduling is in process. See above.
As-Builts
I don’t see funding for this project in the near future. It will appear in the Rate Study, but will no longer be a part of the Manager’s Report.
Shop Organization
The process of inventory has begun. And ground to a halt. This keeps falling victim to higher priority projects. Field staff pick away at this project as time allows.
My first tour after the COVID-19 adventure indicated several areas that need attention. I have passed this list on to field staff and issued work orders where appropriate. See above.
A community member noticed the lack of staff time we have for inventory activities (an important step in controlling the condition of the shop) and has volunteered to help with that project. His first task is learning his way around the Fiix CMMS software.
Training/Certifications
Mick does not yet have the exam scheduled. I keep nagging.
No action yet on setting up for webinars and online training. But I have to do something soon so that we can all keep up with our CEU’s. Though I can do some training with my laptop computer.
Kenny has satisfied his CEU requirements to the end of 2021. I still need to collect a few units.
Safety
We have a mini safety meeting every morning. We have an L&I claim coming. It isn’t major. A muscle was pulled while operating a hydrant.
Vehicles
Service Truck: The driver’s seat is beginning to wear out. We will need to have this seat re-covered. No action yet.
Pickup Truck 1: No Issues
Pickup Truck 2: No issues
Backhoe: Needed a new battery. Replaced.
Web Site
The November newsletter and the 2021 rates have been posted. The December Manager’s Report has been posted.
In ramping up for the upcoming audit, the State auditor’s office liked our website. But they would like to see commissioners meetings minutes posted. That is easy to do. It is wise to give “requests” from the auditor’s office some weight.
New Connections
We have one that has been brewing. It is 106 Mason Lane. The service will have to come off the highway. We have a substantial meter deposit.
The actual service meter will be about 100 feet of the highway edge of pavement, so that will cut down on the DOT application process. I am working with our contractor to make the time we have to take a lane as short as possible. The plan is to get the service lateral stubbed out beyond the highway right-of-way very quickly. The rest of the lateral can be completed under less pressure.
Maybe. As I write this I learn that 106 Mason Lane is a private road. The easements establishing the road are strictly access easements. We may have to come off North Bank Road for this one.
Fire Station
Just about complete. The dirt contractor has not leveled our well site. I talked to the contractor and they haven’t forgotten us. This was a handshake agreement to help out the fire station project.
See the notes above about gravel and fencing.
We have a new fire chief. We have not been introduced yet.
Grant Funding Pursuit
The “Stay-at-Home” order has pretty much shut this effort down for the time being.
Capital Asset Management
Everything is proceeding according to the plan.
The copier is scheduled for replacement in 2021. It is working OK, but has some issues.
When we purchased this one we were in a bit of a panic because the old one had died. Our usual procedure is to purchase lease returns. This has generally worked well for us. We have been able to get high capacity copiers at a very small fraction of the original purchase price (like $2,500 instead of $10,000). So far those copiers have come with plenty of service life left and have worked well for us.
The only drawback is that, if we need an immediate replacement, we have to take what is available. The current copier is not exactly what we needed. It is B&W only, does not print envelopes, and is rather large. We find we need a color capability from time to time, we have had to set up a separate printer for envelopes, and a considerable amount of our limited floor space is occupied by this copier.
I am thinking that, if we are not in a panic mode, we can alert our supplier that we are in the market sometime in the course of the year. By having the luxury of patience we can wait until a machine that more closely meets our needs is available.
We have the funds reserved, and scheduled for 2021, for this asset.
Disaster Management Planning
One of the things that has come out of my discussions with staff around this planning exercise is that our vehicles are too light to tow a generator capable of providing sufficient power for our well pumps.
I need a better understanding of the power grid in our area in order to assess the district’s degree of vulnerability.
I hope to get back into this project now that I am almost fully recovered and the holidays are behind us.
Isolation Valve Exercise Program
We will have a great deal more information on valve locations as we go through that effort. I don’t know how we are going to fit another maintenance item into staff availability.
I haven’t ordered a powered valve key yet as I am keeping expenses as low as possible. I wait to spend the money until we absolutely have to have the part, tool, supply, or whatever. These powered keys vary in price from around $2,500 (powered by a cordless drill) to truly capable keys around $5,500. We don’t need an expensive tool that is going to sit in the shop because no one has the time to use it.
Shop Insulation
On hold until the “Stay-at-Home” order is lifted. It is still a priority, as effective insulation helps keep interior moisture down, but we determined it does not contain asbestos. So I am dragging my feet a bit on this one.
Long Distance Service Laterals
No new thoughts or events.
One incident has been handled, in which the district picked up the cost of repairing a long service lateral. It was certainly the right thing to do. At issue in this case was a long post-meter service lateral over which the property owner had no control.
Previously we had resolved a leak issue in a service lateral crossing private property by moving the meter. The distance was not great and there was a water main fronting the affected property.
But we were not faced with an adjacent homeowner refusing access to someone else’s leaking service lateral.
Respectfully Submitted:
Reg Hearn
General Manager