07/11/18
Budget Position Report
County reports did not arrive in time to present reconciled reports. However, most numbers are in and I expect that the reconciled reports will vary only by a few hundred dollars.
Revenues for June were $73,806. This is a reconciled number (with the bank) but does not include interest income. Revenues to date are $340,936, which is exactly on track with the projections. I expect we will get ahead of the projection during the Summer months.
Expenses for June were $53,639. Which is exactly on track with the budget.
In terms of specific line items, any line item that has 50% or more remaining is on or below budget. Any line item with less than 50% remaining is over budget.
Barring any surprises, we are on track to make our budgeted $165,000 contribution to reserves.
Treasurers Report:
No County reports, no Treasurer’s Report.
Financial System Explanation
Jim suggested we have a “working session” to go over the financial management system.
I concur. We can schedule one for a day when we are all in town and healthy.
As far as the State Auditor is concerned, the management of the finances and adherence to the open meetings rules are the biggest areas of accountability. This stuff is dry as dust, but the commissioners need to have a working knowledge of what all the reports mean.
Let’s set a date.
2019 Budget
I have made a few changes from last month. I added a column labeled “2018 Projected”. It is the revenue and expenditures I am forecasting for 2018 based on revenue and expenditures to date with some adjustments.
I also show the projected 401 Fund balance for the end of each year, except 2017. That is the actual balance.
Doing the projections revealed some areas that needed adjusting for the proposed 2019 budget.
I have included only the 401 Regular Maintenance Fund since it is the only fund for which budgeting can be realistically accomplished.
The highlights of this proposal:
- A 6% rate increase. I have included a proposed rate schedule.
- A full time laborer/meter reader at $15/hr.
- Two projects: The Reynvaan Extension and expanding SCADA controls. We may want to fund one of these projects, or both, from the General Facilities Fund. There is currently about $96,000 in that fund. The Reynvaan Extension is a compliance issue.
- A forecast contribution to reserves of $93,394.
The most controversial element is the request for a full time laborer/meter reader.
Additional Operational Issue #1:
There are some issues hanging out there that are not addressed in current budgeting process.
The first of those is some major repairs that have been deferred that eventually will need to be addressed. Those issues are the water mains on Fairway Terrace and Hill Road south of Central Park Drive. Those will be major expenses for which we have not identified the funds. Which is a fancy way of saying “we don’t have the money”.
Eventually they will have to be addressed.
Additional Operational Issue #2:
We have two fairly major compliance issues. The first is what I am calling the Reynvaan Extension. That is the installation of a short water main south from the Reynvaan booster station to Highway 12. I have included that project in the proposed 2019 budget. The funds I have identified for that project ($45,000) are somewhat of a scientific guess. My plan is to hold off on SCADA controls until we know what the Reynvaan Extension will actually cost. Also, I have not spent the funds identified for the Highway 12 meter project. While that project is high priority due to the safety factor, the Reynvaan Extension is a compliance issue.
The second is the North Bank Booster Station. That will not need to be a very large booster station. Probably something similar to the Hirschbeck Heights Booster Station. But we do not currently have funds identified for that project. From my experience with the Hirschbeck Heights Booster Station, I am thinking that $60,000 is within the ballpark. We were fortunate in being able to negotiate an easement for Hirschbeck at no cost. We might not be so lucky with North Bank.
Additional Operational Issue #3:
There is an issue I have not plugged into the six-year budget yet, but it keeps surfacing. We use Brumfield Construction quite bit just for access to the vac-truck. I have some pretty firm guidelines for when to call for the truck. And the graph lines have not yet crossed where it would be less expensive to have our own rather than contracting it.
There are two really big advantages to the use of the vac-truck. The first advantage is in play when there are other utilities in the vicinity of the repair. In those cases we can excavate to the problem in a matter of minutes with the vac-truck, as opposed to hours of hand digging.
The second advantage arises because the vast majority of the leaks occur in service laterals. Without the vac-truck we have to isolate the section of water main from which the service lateral branches in order to de-water the leak area. The use of the truck allows us to de-water and excavate down to the corp stop, even with the leak still flowing, and turn off just the affected service. This approach not only speeds the process up, but it also eliminates all the hassles associated with isolating a section of the community.
While having access to Brumfield’s vac-truck is a major benefit, there are some difficulties. The first is cost. There is an hourly charge both for the truck and an operator. Sometimes they send the vac-trailer. The cost is a wash because the trailer has to be towed by a truck, which also incurs a charge.
The second is availability. Brumfield makes an effort to accommodate our needs, especially in emergency situations, but it is not always possible for them to respond as quickly as we would like.
I have not done an analysis of how much we spend just for the vac-truck. I think I will undertake that analysis sometime in the coming months. I don’t know if the lines on the graph will ever cross.
Additional Issue #4:
Pressures on Clemons Road continue to be a cause for comments from the community. Eventually we will need to address that problem.
The sticky issue with Clemons Road is that the water main that serves that area doubles as the transmission line from the wells to the water system. We have finally managed to get a tap on the line along Devonshire and it appears that the line is in service. We need to do one more tap to find out for sure. If we are convinced it is “hot”, I want to conduct a detailed leak survey to ensure the line is tight. That may include hiring leak detection company.
There is a tentative plan, a part of the Clemons Road Reservoir plans, to install a booster station near the reservoirs and extend the water main that proceeds east from the reservoirs to the south to serve Clemons Road. In 2007 the engineer’s estimate for that project was $1.2 million. Which included the booster station. Obviously, not a viable project.
If the Devonshire transmission line is operational, or can be made operational with little cost, then the Clemons Road water main could be isolated from the rest of the system and connected to the LeMay Booster Station. That booster station, because of the large fire flow capability it must have, has plenty of capacity to serve all of Clemons Road and the mains that branch off of it.
If all the “ifs” turn into “definites”, the pressure problems on Clemons Road could be solved fairly inexpensively.
Thoughts on Rates:
We have been able to raise rates annually without too much in the way of complaints from the community. I attribute that to an increased effort to communicate with the community and to the efforts to improve our services.
There may be an additional factor involved. This is not something for which I have done a formal study, but it is apparent that the rate of turnover of properties is accelerating. To put it coldly, the “old timers” are either passing away or passing on. We are seeing more folks coming into the community who are used to the higher rates charged by other water utilities.
All those factors do not mean that we can raise rates willy-nilly. Both from our customers’ standpoint, and in the view of the regulatory agencies, we have to have solid justification for rate increases. We know we have to have annual increases of some level just to account for inflation. We also have a pressing need to build reserves. Maintenance and repair of an aging system is the third operational cost factor on which we have focused, followed by compliance issues.
We have concentrated on those operational and compliance issues, plus we have worked to transition from what I characterize as a “mom & pop” management style to a more professionally managed utility. That effort has had an associated cost that has contributed to increased expenses, and, therefore, increased rates.
The third major issue, along with operational and management issues, is customer service. We have made great strides in that area with little in the way of increases in associated costs. We have done that primarily through attitude adjustment and making customer service events top priority. But we are reaching the limit of what we can do with currently available resources. I have the sense that with increasing rates the community is going to expect increasing service. It is, after all, the aspect of the District most visible to the community.
The customer service aspects that I think are in our future include:
- A web site
- More frequent newsletters
- Longer office hours
- Better backup for office staff absences (illness and vacation)
- Community outreach events
The web site will not be terribly expensive. Probably in the neighborhood of $1,500 to build and a similar annual amount to maintain.
I would like to see quarterly newsletters. That will involve quite a bit more of my time. Printing and mailing will be a significant cost. I have considered replacing the newsletters with the web site, but we still have a significant part of the community that does not have, or want, internet access.
By far, the most expensive aspects will be the combined efforts to have longer office hours and a better means of covering staff absences. Essentially, that will mean a full time District Clerk and at least a part time clerical person (or vice versa). On a daily basis there is not enough work to keep 1.5 FTE busy, but that is offset by having someone available to keep the office open during normal office hours (8:00-5:00) and provide some level of backup for illness and vacation.
Billing System
The Banyon Data Systems billing software is giving us problems. To make that even more of an adventure, Banyon’s customer service has gone a long ways down hill.
The big problem with the software itself is that it will, at random, drop meter readings. Our calls to Banyon to fix this problem resulted in their staff telling us that the readings were not entered in the first place. That is an impossibility. You can’t generate bills without current readings, even if they are zero.
When other, more minor, problems crop up, it seems that our calls to them are a big bother.
Adding insult to injury, during the last go around it was revealed that the current version of the software is Version 10. We have been using Version 6. We were never informed about Versions 7, 8, 9 or 10. For this we are paying $795 a year.
The billing system is at the center of our revenue generating efforts.
Some of the other irritations include:
- A Report Writer module that is way outside the bounds of “user friendly” and is very limited in the ability to format reports.
- An abstruse interface with Databar.
- The inability to print duplicate water bills (though with a little creativity and help from DATABAR we can generate a duplicate bill from DATABAR’s print files).
- An account history report that is difficult to read and almost impossible to interpret. When we have history questions I often build a spreadsheet so that we, and the customer, can understand the history.
- No ability to track credit card receipts and reconcile the receipts with the Point & Pay deposits to our bank account. We do that separately.
- An overly complex account numbering system.
- We only have one “seat”. Acquiring a second seat involves essentially purchasing, at full price, another copy of the software. Currently, if there is work I need to do in the billing system, I have to kick Charli out of her chair.
- I am not convinced that we are getting good water usage (on the sales side) numbers. Raw numbers still indicate an almost 40% water loss. I get that down for our Water Use Efficiency Report by including water we use but don’t sell, but I just don’t believe we are losing that much water. My indicator is that we average about 200 gallons per day per connection based on water pumped records. If the water loss is to be believed, our average consumption per connection would have to be about 150 gallons per day. I just don’t believe it.
- One of the prime reasons for adopting this software was the low initial cost. I think we have gotten our money’s worth from the initial investment. But the $795/year seems like a definite waste of money to me.
My proposal is to switch to the Bias Software billing module that attaches to our accounting system. It fixes all of the above irritations, includes some features that would be very useful that we currently do not have, comes with the Bias support team (who are exceptional), and can be set up “hosted” rather than the District purchasing the software. It has the further advantage of interfacing with the accounting system.
Their proposal includes some substantial start up costs. But we would not use everything they are proposing. Specifically, we would not use the Cash Receipting module, and, most likely, would not request on-site set-up assistance. We did not require on-site assistance to set up the accounting system and that saved us a significant chunk of change.
Their proposal totals $4,930 if we leave out the Cash Receipting. I don’t know how much we would save by not having an on-site session. That is difficult to quantify. The set up includes basic set up plus importing our existing data into the new system. That amount also includes the first six months of “hosting” at $200 month.
We could use some variation of our current account numbers, so we would not have to go through the education process of new account numbers.
My big issue is customer support. While it might take a day or two to get Banyon to respond (and then reluctantly), Bias has always been available to answer questions and fix problems within a few minutes of our cries for help. They have provided literally hours of assistance in getting us BARS compliant inside our monthly hosting fee.
Water Usage
Please see the Production Summary included in your packets.
Multi-unit shut offs
We need a set policy on multi-unit shut-offs for non-payment.
In June we were faced with the possibility of shutting off the Hidden Valley Mobile Home Park, which has 88 homes. From a strictly legal standpoint, we are within our rights. And under the operating philosophy of everyone being treated the same, the shut down is justifiable.
But I fear that it would be a public relations train wreck. We need to think about this one.
Fortunately, the owner’s wife came in just about at the last minute and paid the bill.
Central Park Elementary School Lead Problem
This crisis has disappeared below the waves. I suspect that the DOH office that handled the sampling, which was not done by the Office of Drinking Water, was unprepared for the consequences of their actions, which included improper sampling technique.
I have hopes that the processes and procedures are being reviewed in order to avoid the kinds of problems experienced in that last round.
Maintenance Activity:
Usual daily/weekly/monthly maintenance activity. See attached report.
Maintenance activity is beginning to be a critical issue. There is no lack of energy or efficiency on Kenny’s part, but maintenance items continue to pile up, and, more disturbingly, deferred. This situation is further complicated during meter reading, as critical repair items come up during that period and meter reading must be delayed while the repair is accomplished.
The “summer projects” routine is also falling behind. For a long time we could get the summer maintenance items completed with the help of a temporary employee. Even with the highly variable character of the summer help we were able to get the maintenance items completed during the summer months.
In the past two years, that has not been case. In the summer of 2016 we had a pretty good temporary, but had to extend the employment period into Fall. In 2017 we had a truly outstanding helper (Mick Peterson) AND we extended the employment period into the Fall, and quite a few of the Summer tasks had to be deferred.
At this point we have 13 work items for the upcoming Summer. Seven of the 13 are relatively critical. Just one of the items, hydrant maintenance, could occupy a moderately ambitious helper all Summer to complete. In addition, with the isolation valve exercise program added as a Sanitary Survey item we are under pressure to develop and implement a program. While development is something of an issue, I don’t know where we will find the time to implement (see additional discussion, below).
With the system continuing to age it simply takes increasing amounts of labor to stay ahead of maintenance and repair.
The point of this discussion is to draw attention to the need to be seriously thinking about additional field staff.
Another concern is our lack of depth in the office. Often, if Charli is ill or on vacation I can keep the office open and perform both Charli’s duties and my own. However, there are times when that simply cannot be done, either because my duties take me out of the office during office hours, or I am working on projects that require my undivided attention. Currently, at those times, we have no option but to close the office. While most of our customers seem to be understanding, as water rates continue to increase I expect many of those we serve will be expecting a higher level of service.
Our four most visible indicators of a positive customer service attitude are system reliability, the accuracy of our billing, the condition of the fire hydrants, and the service from the office.
I am working on the six year budget. I have always done so, but was never confident enough in my numbers to consider it a useful tool. With the implementation of the Bias software the budgeting process is both easier and more accurate. I will want to be working additional field into our six year plan. As noted above, I am proposing a laborer/meter reader for 2019.
Specific Summer Projects:
- Strip and recoat North Bank Reservoir roof
- Paint pumphouse plumbing
- Paint pumphouse steps
- Install Well #6 flush valve
- Determine status of Devonshire Road transmission line IN PROCESS
- Install sampling station at Reynaan Reservoir DONE
- Locate buried fire hydrant and water main isolation valves ONGOING
- Paint and/or repaint fire hydrants
- Install number plaques on remaining fire hydrants
- Catch up fire hydrant maintenance UNDERWAY
- Rearrange shop site to accommodate proposed fire station retention pond
- Fix 117 Reynvaan Drive service lateral FIXED
- Clean up well site
The above is in addition to the routine grounds maintenance. Lots of grass to mow.
Contractor Repairs
Some use of the vac-truck and/or trailer in June, plus their assistance in replacing Fire Hydrant 113.
Highway 12 hydrant
Scott has prepared and sent a letter.
Hill Road Water Main
I am putting this project on hold. I just don’t see where we can squeeze out the money.
Well Site Fence
Along with some of the other nagging maintenance chores, the well site fence needs some work. Some of the barbed wire has fallen and the gate needs a bit of welding. I will be contacting a fence company to work on those items.
No action in June.
Highway 12 Meters
I have been dragging my feet on this project and was intending to do nothing until the WASWD Fall Conference.
However, recently the supply situation on one of the most promising technologies has changed. The technology is by a company called Kamstrup. They are based in the Netherlands with manufacturing capability coming on line in the US. The technology is very promising, but I was concerned that they had no local distributors, only a regional representative. In recent weeks Correct Equipment, a local company, has become a dealer for this line of metering equipment.
Correct Equipment is an interesting company. They seem to be out looking for some equipment solutions “outside the box”. They are the folks who provided our new chlorine injection pumps. Over the past year those pumps have saved us almost $1,000 in overhaul costs and have not had one minute of down time.
I may move this project up.
Shop Plumbing
This project is under way. The estimate is $2,100. That will include a new toilet, a new deep sink, a hot water heater, and a washing machine hook up. We will need to get some electrical work done, too.
Shop Organization
This project has started. But we need to keep breaking off to get some higher priority work done.
Training/Certifications.
Kenny has completed the first phase of the computer class. The second phase starts up in the fall.
I have taken the WDM4 preparation class. This test is going to be a tough one. My test date is July 12th. I should be able to pass the test if I can speed up my work on the math. For the lower certifications the math is pretty basic and is only 10% of the exam. For the WDM4 test they get into some actual engineering problems and the math will constitute 15% of the test. I used to do a lot of engineering mathematics, but it has been a very long time.
I am used to aceing these exams. I do not expect that will happen this time.
Safety
We have a mini safety meeting every morning. This time of year we focus on hydration issues and driving safety.
The focus on safety, and safety training, has reduced our accident rate to zero for many months now. Call that years. I intend to keep it that way.
Vehicles
Service Truck: No issues.
F-150: Needed a new battery.
S-10: No issues.
Pickup Truck: No Issues
New Connections
Three new connections:
24 Lutton Lane
28 Grace Lane
34 Grace Lane
Old Shop Building Gutters & Downspouts
No action in June. I need to move this item up on the priority list.
Shop Site South Fence
On hold until we see all that the fire station fencing will entail.
Alder Glen & Etc.
No news in June. We still have a few of these to check out. Hopefully, this summer.
Carl Way/Ridgeview: Not an issue
Hemlock Park
Lois Lane Not an issue
Waverly Court Not an issue
Garden Road: Not an issue
Walthom Lane: Not an issue
Greenbriar Court
Reynvaan Court
Madow Court
Reed Lane Not an issue
Blaine Road (End) Not an issue
Larson Lane Not an issue
Fremont Drive
Silkey Court
Lake Road
Hemlock Park
Fairway Park
River Road: Replaced
Alder Glen: Will need replacement.
Fairway Terrace: Will need replacement.
Filing System
Charli and I have started to sort through the archive boxes from the shop. So far the majority of the contents have been bill stubs.
We have found some material of historical significance, but not very much.
Except for the plans, I have found no documentation on either the old booster pump, or the reservoir and new booster station for Reynvaan. Very curious.
Renters
No action in June. As a reminder regarding this item…it is my intent to have two forms. One form that is completed by the tenant at the time they apply to have the billing in their name, and a second form that will be sent to the property owner informing them that the tenant is vacating. My thinking on the second form is that it will include a forwarding address for the tenant and will require acknowledgement by the property owner before the tenant’s deposit will be sent to the forwarding address.
While our policy of requiring a deposit for tenants is a service to the property owner, the primary objective is to remove the District from tenant/owner conflict. We are not a collection agency and have not intention of becoming one.
Armory
Somewhere in the background this project is moving forward. I know that the Armory engineer and the LeMay contractor have been coordinating some activities. They will be requesting domestic service in addition to the fire flow.
WASWD Fall Conference
I have made the initial reservations for my attendance. This is shaping up to be an excellent conference.
I am adding some time off at each end. I plan to leave early for the conference and visit the NWS corporate headquarters (now located in Colfax), and proceed to Helena, Montana after the conference to visit my cousin. So I plan to be out of the office from Monday, September 17th and back in the office Tuesday, September 25th. Which may extend into Wednesday if I find I can no longer drive 12 hours straight.
LeMay Project
Revised plans have been submitted and approved by us.
This project is moving forward. We helped with that by allowing LeMay to use C-900 pipe if bedded exactly to our specifications. The HDPE simply was not available.
I have been monitoring progress and the quality of the work. The progress is slow, but the quality of the work is first rate.
I have started work with Correct Equipment regarding our specifications for the controls and SCADA interface. This interface is ultimately the responsibility of the prime contractor, Rognlins. But I really don’t want to have this done in a last minute panic.
Fire Station
No progress impacting the Water District in June.
Big Ridge Lodge
The Developer Extension Agreement has been renewed.
However, it appears they may be reducing the project further, to just six connections. If that is the case, I would propose dropping the requirement for an hydraulic analysis through the Deer Park community.
I have heard nothing about this project in June.
Reynvaan Site Security
Lighting and fencing have not been ordered.
Reynvaan Lower Pump House
This building was a bit of a thrown together structure in the first place. The years have not been kind to it.
I think it will need to be replaced sometime in the next couple of years. It is a small building and will not be terribly expensive.
As-Built Drawings
I am leaning towards handling this in-house with some limited assistance from consultants. But I have made no final decision yet, nor have I taken any action.
Disaster Management Planning
No action on the plan outline in June.
I really need to bear down on this. We are in pretty good shape for typical emergencies, but there are still holes in our ability to respond to a real catastrophe.
One item I want to investigate is the possibility of developing an intertie with the City of Aberdeen at Lake Aberdeen. That would provide us with a source of non-potable water in the event of an extreme event (earthquake/tsunami) that might render our wells inoperable. The water would have to be filtered and boiled in order to be “potable”, but residents could use it for toilet flushing and other, non-potable, sanitary uses. Coffee filters work for filtration and the water could be boiled for drinking and cooking.
A dream project would be to install powered shutoff valves at the reservoirs and tie those valves into SCADA. Water main breaks, inevitable in a large earthquake, can quickly drain the reservoirs. It is now possible to give 40 seconds to 4 minutes of warning of an impending large quake (bet you didn’t know that. It is closely held Emergency Management information. So don’t go spreading it around) during which time some emergency actions can be taken. Water in the reservoirs would be useful as an emergency supply. There is no money at the moment to address a danger that is a high hazard but low probability.
WAWARN
Nothing of immediate interest.
Red Flag Programs
We don’t have a plan. But we have run into a problem. When payments are being received over the phone we have to be on speaker phone so we have both hands free, and we have to read back the information.
The problem occurs when another customer is at the counter. They can hear all the information they need to steal someone’s credit card information.
Currently, all we can do is ask the person on the phone to hold until we take care of the customer at the counter and get them out the door.
This issue will probably force me to work on developing a formal plan.
Future Very Small Projects
We have a list of very small projects that need attention:
Strip and recoat North Bank roof (Scheduled for Summer 2018)
Install Well #6 Flush Valve
Repair Well #6 Shut Off Valve
Locate Isolation Valves in “The Swamp” area (MAIN June BE DRY)
Paint Hydrant Caps/Install Number Plates (Started Summer 2015)
Landscape Shop/Garage Area (ONGOING)
Install Sampling Stations stations to replace followup sites that are currently private addresses.
Clean and organize Shop ONGOING
We tackle these kinds of projects as Summer projects.
Isolation Valve Exercise Program
This is another Sanitary Survey item. It has been on my to-do list since 2012. Action has been slow for two reasons:
1. It is a complex problem that is going to require considerable planning.
2. I don’t know where we are going to find the time to do the exercising once we have a program in place.
3. It is dependent on the as-built project.
Correction! I have figured out a way to develop the plan independent of the as-built project. I have found that I can use Google Maps to locate isolation valves. I can key the valve locations to intersections.
I am working on the program. But bullet #2 above still applies.
Summer Help
Mick has started and has hit the ground running.
Future and/or On-Hold Programs
Web Page
Email Bills
Unfunded “Dream” Projects
Include Reynvaan Pump Station in SCADA
Probably will require new controls, which are getting due anyway
Include Hirschbeck Pump Station in SCADA
Convert SCADA Communications to Cellular, or whatever
Repave Office Parking Lot (Over Jim’s dead body) THE WORST SPOT IS PATCHED.
Replace Office Carpet
Long Distance Service Laterals
Any thoughts would be welcome.
Respectfully Submitted:
Reg Hearn
General Manager