HomeMy Public PortalAboutFY18 Bgt Fin Comm Wrkshop - Website11Finance Committee MeetingFY18 Strategic Business and Operating Planand Preliminary Budget ReviewApril 04, 2017
22Finance Committee MeetingFY18 Strategic Business Operating Plan and Preliminary Budget ReviewI. Strategic Business and Operating Plan (SBOP)II. FY18 Preliminary BudgetIII. Preliminary Budget Compared to Rate Commission ReportIV. Next Steps and Questions
33Strategic Business and Operating PlanPrepared in accordance with Section 5.110 of the Charter of the Metropolitan St. Louis Sewer DistrictFY18
44VISION STATEMENTQuality Service Always Strategic Business and Operating PlanMISSION STATEMENTTo protect the public’s health, safety, and water environment by responsibly providing wastewater and stormwater management.
55Integrity– Acting ethically at all times, treating everyone with honesty, fairness and respect. Teamwork– Working together to accomplish our mission with open communication, trust respect and diversity.Innovation– Embracing continuous improvement and new solutions to achieve excellence. Employees– Developing successful, responsible and safety conscious employees and acknowledging their contributions.Customers– Building strong relationships by keeping our commitments, providing excellent service and being transparent in everything we do. Strategic Business and Operating PlanVALUES
6A. Deliver consistent, high quality customer service;B. Comply with all legal and regulatory requirements and schedules;C. Minimize customer rate increases; andD. Be accountable to the St. Louis community. GOALSStrategic Business and Operating Plan
7STRATEGIES1. Educate and partner with stakeholders to build support; 2. Manage the District’s costs and revenues to optimize financial impacts;3. Integrate and improve the District’s business processes;4. Promote appropriate standards through proactive regulatory and legislative involvement;5. Address customer and regulatory needs through a comprehensive infrastructure management program;6. Create a learning and business oriented culture based on competency and accountability.Strategic Business and Operating Plan
88FY18Preliminary Budget
99FY18 Preliminary Balanced Budget FY18 Total Revenue($$s in millions)Wastewater User Charges $360.4Stormwater User Charges 0.0Revenue Bonds 220.0Stormwater Taxes 31.4Investment and Other Income 7.6Use of Fund Balances 31.7Total District Revenue $651.1FY18 Total Expense($$s in millions)Operating Budget $200.1CIRP 341.9Debt Service 109.1Total District Expenses $651.1
1010FY18 Preliminary BudgetI. The General Fund budget includes:A. $0.3 million increase for Salaries & FICA –excluding incremental budgets (includes 3.15% avg. wage increase.) Includes elimination of 16 positions.B. $1.4 million in incremental budgets tied to the SBOP, including 8 additional positions of which the majority is primarily related to providing storm water services.C. 1.4% or $2.6 million overall increase from FY17I. Includes a Total Capital Improvement and Replacement Program (CIRP) budget of $341.9 million. II. Assumes the issuance of additional bonds with a par value of $200 million and approximately $20 million in premiums net of costs of issuance.III. The budget was developed to align with the July 2015 Rate Commission Report.Key Points
1111FY18 Preliminary Budget - RevenueWW User Charges$360.4 55%Investment and Other Income$7.6 1%Revenue Bonds$220.0 34%Taxes$31.4 5%Use of Fund Balance$31.7 5%Total = $651.1($$s in millions)
1212FY18 Budgeted Revenue by Major Category FY17$339.5 FY17$242.5 FY17$30.7 FY17$54.1 FY17$7.1 FY18$360.4 FY18$220.0 FY18$31.4 FY18$31.7 FY18$7.6 $- $50.0 $100.0 $150.0 $200.0 $250.0 $300.0 $350.0 $400.0 $450.0()Change($22.4)Change$0.7Change$0.5Change($22.5)Change$20.9($$s in millions)FY17 - $673.9FY18 - $651.1$22.8 M or 3% Decrease$22.8 M or 3% Decrease
1313Schedule ofResidential User RatesWastewaterFY17 FY18% ChangeEffective Date 7/1/16 7/1/1744.59$ 49.31$ 11%Average Monthly Residential Bill (7 Ccf)
1414FY18 Preliminary Total Budget Expenses($$s in millions)Wastewater Operating Budget$183.7 28%Stormwater Operating Budget$16.4 2%Wastewater CIRP$331.6 51%Stormwater CIRP$10.3 2%Debt Service$109.1 17%Total = $651.1Total Operating Budget is $200.1, 30% of totalTotal CIRP Budget is $341.9, 53% of total
1515FY18 Budget – Operating Expense ComponentsWastewaterGeneral Fund 163,493,836 Improvement Fund 50,000 Wastewater Emergency Fund‐ Water Backup Fund 3,801,300 General Insurance Fund 5,825,500 Sanitary Replacement Fund 7,500,000 Total Wastewater 180,670,636 StormwaterOMCI Funds 19,380,375 Total Operating Expenses 200,051,011
1616FY17 FY18 $ % Civil Service Commission 10,000$ 10,000$ -$ 0.0%Rate Commission 0 594,304 594,304 N/ASecretary-Treasurer (includes Board of Trustees)1,809,168 1,899,735 90,567 5.0%Executive Director 1,933,508 1,916,950 (16,558) -0.9%General Counsel 2,552,379 2,601,943 49,564 1.9%Human Resources 10,299,833 10,286,917 (12,916) -0.1%Finance 20,533,378 20,300,675 (232,703) -1.1%Information Systems 13,773,149 13,880,415 107,266 0.8%Engineering 26,210,016 26,063,223 (146,793) -0.6%Operations 110,124,289 110,955,902 831,613 0.8%Total Departments 187,245,720$ 188,510,064$ 1,264,346$ 0.7%76,893 0 (76,893)0 1,407,576 1,407,576Total General Fund Operating Budget 187,322,613$ 189,917,640$ 2,595,029$ 1.4%Energy Loan Debt Service 35,900 35,900 0187,358,513$ 189,953,540$ 2,595,029$ 1.4%CHANGEIncrementalsTotal General Fund Operating Budget with Energy LoanTax Commission FeeFY18 General Fund BudgetBy Department
1717FY17$105.7 FY17$18.5 FY17$17.2 FY17$50.1 FY17$5.1 FY18$110.2 FY18$16.5 FY18$17.5 FY18$50.7 FY18$5.2 $- $10.0 $20.0 $30.0 $40.0 $50.0 $60.0 $70.0 $80.0 $90.0 $100.0 $110.0 $120.0 $130.0Change$0.6Change$0.3Change($2.0)Change$0.1Change$4.5($$s in millions)FY18 Budgeted Operating Expense by Major Category FY17 - $196.6FY18 - $200.1$3.5 M or 2% Increase
1818FY18 Incremental Budget SummaryDepartment Purpose FTE ChangeBudgetOperations *Increase Stormwater Service Level 4 $1,151,513Operations Implement Straight Shifts at 3 Treatment Plants 3 173,177Information Systems Add an Assistant Director of Information Systems1 82,886Total General Fund Incremental8 $1,407,576*Stormwater Incremental Budgets = $1.2 Million
1919FY18 District Funded Positions969878981981936956963976976 992 1,000 1,019 1,003 8 600 700 800 900 1,000 1,100FY14 FY15 FY16 FY17 FY181,011Total1Assistant Director of Information Systems; 3Treatment Plant Operators; 3Collection System Technicians (SW); 1Fleet Mechanic (SW)8 Total Incremental Positions14Flow Monitor Positions (10 Technicians and 4 Engineers; 1Public Information Representative; 1Central Services Coordinator16 Total Eliminated Positions
2020Billed Ccf’s are down significantly from Rate Commission (RC) levels. Bond issuances are lower in part due to Wastewater CIRP spending being down and the RC anticipated the need for debt service reserves. Most of the Other revenue variance is due to lower than anticipated Bad Debt Provisions.Debt Service Expense is lower because less debt has been issued. CIRP spending is favorable due to timing of projects and favorable bids.
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2222Type of Project Number BudgetWastewater Construction 73 250,156,000Wastewater Engineering 79 60,516,000Stormwater Construction 14 9,400,000Stormwater Engineering 1 100,000New Project Appropriations Subtotal: 167 320,172,000Continued Wastewater 5 20,936,000Continued Stormwater 2 800,000Continued Project Appropriations Subtotal: 7 21,736,000PROJECT APPROPRIATION TOTALS: 174 341,908,000FY 2018 CIRP Program Summary
2323FY 2018 CIRP New Wastewater & Stormwater ProjectsTotal Budget $320.2 MTotal Number of New Projects 167Wastewater$310.7 M152 ProjectsStormwater $9.5 M15 Projects3%97%
2424FY 2018 CIRP New Wastewater Project FundingTotal Number of ProjectAppropriations 167Total Budget $320.2 M13% City/County34 Projects$43.0 M65% County108 Projects$206.7 M6% Treatment Plants12 Projects$17.8 M16% City13 Projects$52.7 M
2525FY 2018 CIRPFunding SourcesTotal Number of ProjectAppropriations 167Total Budget $320.2 MSanitary Replacement Fund:126 Projects$289.3 M90%General Fund:16 Projects$16.8 M5%5%OMCI/Special Funds:25 Projects$14.1 M
2626FY 2018 CIRP Engineering & Construction - NewTotal Number of ProjectAppropriations 167Total Budget $320.2 MConstruction87 Projects$259.6 M81%Engineering80 Projects$60.6 M19%
2727WastewaterCoordination with Others 0Easement Acquisition / Condemnation 2Projects in Design / Major Scope Changes 3StormwaterCoordination with Others 1Easement Acquisition / Condemnation 1Projects in Design / Major Scope Changes 0Total: 7FY 2018 CIRP Continued Projects
2828Type of ProjectNumberBudgetWastewater 21 78,619,000Stormwater 3 2,815,000Phased Funding 14 136,715,000Project Totals: 38 218,149,000FY 2018 CIRP Contingency Projects
2929Type of Project Number % BudgetAsset Management Renewal 15 6 19,562,000Cityshed 6 6 19,238,000CSO 12 16 50,470,000SSO 87 61 195,696,000Treatment Plant 12 6 17,751,000Districtwide 20 2 7,955,000Stormwater 15 3 9,500,000TOTALS: 167 100 320,172,000FY 2018 CIRP New Allocations
3030FY 2018 CIRP Program HighlightsAsset Management Renewal – renewal of existing District infrastructure (assets) such as sewer lines, manholes, and pump stations. Renewal is required because of deterioration due to ageing infrastructure, and can take the form of partial repairs, rehabilitation, or full replacement depending on the condition of the asset.• Rehabilitation and or replacement of six pump stations within the collection system.
3131FY 2018 CIRP Program HighlightsCityshed – projects designed and constructed to mitigate the effects of wet weather surcharging and overland flooding of the combined sewer system. Primarily in the City of St. Louis. Types of projects include property buyouts, basin and relief sewer construction.• Complete construction of the Harlem Baden Ph IV –Improvements from Basin to Hamilton Trunk project
3232FY 2018 CIRP Program HighlightsCSO – projects in the combined sewer area that are intended to reduce or control Combined Sewer Overflows (CSO), a discharge from the combined sewer system at a point prior to the headworks of a wastewater treatment facility. The majority of MSDs CSOs are along the River DesPeres and the Mississippi River.• Continue construction of the Maline Creek CSO Storage Facility and the CSO Volume Reduction Green Infrastructure Program projects
3333FY 2018 CIRP Program HighlightsSSO – projects to reduce and eliminate Sanitary Sewer Overflows (SSOs) in the separate sanitary sewer system. An SSO is any release of wastewater from the separate sewer collection system prior to a treatment facility. • Construct 39,000 feet of sanitary sewer, and 11,000 feet of storm sewer to facilitate the removal of private I/I• Work will result in the removal of up to 5 constructed SSOs.
3434FY 2018 CIRP Program HighlightsTreatment Plant – projects planned at one of the 7 existing wastewater treatment facilities within the District. Projects are required to renew ageing infrastructure, improve safety or efficiency, or to improve treatment processes due to changing regulations or permit requirements.• Replacement of the Final Clarifiers at the Coldwater Creek Wastewater Treatment plant.
3535FY 2018 CIRP Program HighlightsDistrictwide – projects are general projects that are required to deliver support activities for the CIRP and meet Consent Decree requirements. These projects are not site specific, and typically occur throughout the District.• CCTV inspection and physical inspection of 700,000 feet of sewers, primarily focused on the older brick sewers in the City of St. Louis.
3636FY 2018 CIRP Program HighlightsStormwater – projects that addresses localized structure and yard flooding and erosion issues driven by storm events throughout the District. Projects also provide for repairs and rehabilitation of the existing stormwater infrastructure within the District. Stormwater projects are funded separately from OMCI taxes.• Construct improvements to reduce flooding at 9 structure and 25 yard locations, and address erosion at 10 properties
3737FY18 SBOP and Preliminary Budget ReviewQ & A
3838FY18Next Steps
3939FY18 SBOP and Preliminary Budget Finance Committee MeetingReview (including CIRP) April 4, 2017; 9:00 a.m.• Publication of Public Hearing Notice April 20, 2017(The notice will be published in the St. Louis Post-Dispatch, St. Louis American, St. Louis Business Journal, and on the MSD Internet Site)•FY18 Budget Follow-up Discussion Finance Committee Meeting May 2, 2017; Time: TBD• Budget Introduction Board of Trustee Meeting May 11, 2017; 5:00 p.m.• Public Hearing After Board of Trustee Meeting(Finding of Fact Committee)May 11, 2017; 6:00 p.m.• Budget Adoption Board of Trustee MeetingJune 8, 2017; 5:00 p.m.* All meetings held at 2350 Market Street, Room 109FY18 Budget Meeting Schedule *