HomeMy WebLinkAbout10- City Clerk CITY OF SAN BERNARDINO—REQUEST FOR COUNCIL ACTION
From: Rachel G. Clark, CIVIC Subject: Receive and File - 1998-1999
Annual Audit of the Water Department's
Dept: City Clerk Water and Sewer Utilities
11 Council Meeting: 3/6100
Date: February 16, 2000 a a L
Synopsis of Previous Council Action:
Similar action taken each year following completion of the annual Audit Report.
Recommended Motion:
That the Mayor and Council receive and file the 1998-1999 Annual Audit of the Water
Department's Water and Sewer Utilities.
cA_zj 12. Uc,��
Signature
Contact person: Rachel Clark Phone: Fxt 51n7
Supporting data attached: Yes Ward:
FUNDING REQUIREMENTS: Amount:
Source: (Acct. No.)
(Acct npsrri to inn)
Finance:
Council Notes:
Agenda Item Nolo
3/&/aoao
Y
STAFF REPORT
TO: Honorable Mayor and Members of the Common Council
FROM: Rachel G. Clark, CMC, City Clerk
DATE: February 16, 2000
SUBJECT: 19998-1999 Audit Report for Water Department Water and Sewer
Utilities
BACKGROUND INFORMATION:
The firm of Soren McAdam Bartells has completed the 1998-1999 Annual Audit of the
Water Department's Water and Sewer Utilities. This report was presented to and
accepted by the Board of Water Commissioners at their meeting of January 25, 2000.
RECOMMENDED MOTION:
That the Mayor and Council receive and file the completed 1998-1999 Annual Audit of
the Water Department's Water and Sewer Utilities.
Rachel G. Clark, CMC
City Clerk
A
MUNICIPAL WATER DEPARTMENT
OF TFIE
CITY OF SAN BERNARDINO, CALIFORNIA
Financial Statements
And
Supplementary Information
With
Independent Auditors' Report
For the Year Ended June 30, 1999
WA WA
I
LWA
SOREN ♦ , ♦ BARTELLS
CERTIFIE PUBLIC ACCOUNTANTS, lNC.
TABLE OF CONTENTS
Page
Independent Auditors' Report I
Combining Financial Statements
Combining Balance Sheet 3
Combining Statement of Revenues and Expenses 7
Combining Statement of Changes in Fund Equity 8
Combining Statement of Cash Flows 9
Notes to Combining Financial Statements I1
Supplementary Information
Board of Water Commissioners and Organization 30
Schedule of Expenditures of Federal Awards 31
Schedule of Insurance Coverage 32
Schedule of Water System Demographics 34
Schedule of Water Production 35
Schedule of Water Rates 36
Schedule of Sundry Water Statistical Data 38
Schedule of Service Area and Customers 40
Schedule of Sewer Rates and Statistics 41
Schedule -Certificates of Participation, San Bernardino Public Safety Authority 44
Schedule— 1998 Refunding Sewer Revenue Certificates of Participation 46
Series 1998A Water and Wastewater Revenue Bonds 48
Bond Schedule -General Obligation Waterworks Bonds, Series C 49
Year 2000 Issue 50
MICHAEj,R.ADCOCK.C.PA.
THOMAS E.AHERN.C.P.A.
GARY L.CHRISTENSON,C.PA .
LINDA S.DEVLIN,C.P.A.
RHEE ELIKER,C.PA. . MEMBERS
WING K.LAU,C.P.A.
DOUGLAS R.MrADAM,C.PA.
BARBARA D.RASMUSSEN,C.P.A. POLARIS arrP.RNATIONAL
JAMES L SOREN,C.PA. -
KIRK G.STITT,C.P.A.
NORA L.TEASLEY.C.P.A. SOREN McADAM BARTELLS CERTIFIED NCCOUI A OF
DAVID P.TATTLE,C.P.A.
CERTIFIED PUBLIC ACCOUNTANTS
CINDY a.WATTS.c.e.A. CERTIFIED PUBLIC ACCOUNTANTS, INC. eaIVATE COMPANIES PRACTICE SECTION
Independent Auditors' Report
To the Board of Water Commissioners
Municipal Water Department of the
City of San Bernardino, California
We have audited the accompanying combining financial statements of the Municipal Water Department of the
City of San Bernardino, California as of and for the year ended June 30, 1999 as listed in the table of contents.
These financial statements are the responsibility of the Municipal Water Department's management. Our
responsibility is to express an opinion on these financial statements based on our audit We did not audit the
financial statements of the West End Water Development, Treatment and Conservation Joint Powers
Authority, the San Bernardino Public Safety Authority, or the San Bernardino/Colton Rapid Infiltration
Extraction Project which represent 28.0 and 4.0 percent of the total assets and operating revenues,
respectively, of the Municipal Water Department. Those financial statements were audited by other auditors
whose reports have been furnished to us, and our opinion, insofar as it relates to the amounts included for these
organizations and project, is based on the reports of the other auditors.
We conducted our audit in accordance with generally accepted auditing standards. Those standards require
that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are
free of material misstatement An audit includes examining, on a test basis, evidence supporting the amounts
and disclosures in the financial statements. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall financial statement presentation.
We believe that our audit provides a reasonable basis for our opinion.
As discussed in Note 1, the financial statements present only the Municipal Water Department and are not
intended to present fairly, in all material respects, the financial position of the City of San Bernardino,
California, and the results of its operations and cash flows of its proprietary fund types, in conformity with
generally accepted accounting principles.
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2155 Chicago Avenue,Suite 100 ♦ Riverside,CA 92507-2203 ♦ (909)68 3-0672 ♦ Fax(909)686-7780 ♦ E-mail:amb-rlv@worldnecaa.na
2068 Orange Tree lane,Suim 100 ♦ P.O.Box 8010 ♦ Redhnds,CA 92375-1210 ♦ (909)798-2222 ♦ In(909)7989772 ♦ E-mail:smbrcdlands@woddna.aa.na
In our opinion, based on our audit and the reports of other auditors, the financial statements referred to above
present fairly, in all material respects, the financial position of the Municipal Water Department of the City
of San Bernardino, California as of June 30, 1999, and the results of its operations and its cash flows for the
year then ended, in conformity with generally accepted accounting principles.
The accompanying supplementary information as listed in the table of contents is not a required part of the
basic financial statements but is provided for purposes of additional analysis. The information contained on
pages 30 through 49 has been subjected to the auditing procedures applied in the audit of the basic financial
statements and, in our opinion, is fairly stated in all material respects in relation to the basic financial
statements taken as a whole. The year 2000 information on page 50 is not a required part of the basic financial
statements but is supplementary information required by the Governmental Accounting Standards Board. We
have applied certain limited procedures which consisted principally of inquiries of management regarding the
methods of measurement and presentation of supplementary information. However, we did not audit the
information and do not express an opinion on it. In addition, we do not provide assurance that the Department
is or will become year 2000 compliant, that year 2000 remediation efforts will be successful in whole or in
part, or that parties with which the Department does business are or will become year 2000 compliant.
SOREN ♦ McADAM ♦ BARTELLS
Certified Public Accountants, Inc.
Riverside, California
November 12, 1999 4yinVS evlm, CPA
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1
MUNICD'AL WATER DEPARTMENT
OF THE CITY OF SAN BERNARDINO, CALIFORNIA
Combining Balance Sheet
June 30, 1999
(With Comparative Information for Jute 30, 1998)
Water Sewer Combined
Utility Utility Eliminations 1999 1998
ASSETS
Current assets
Cash and cash equivalents $ 1,470,517 $ 2,923,598 $ 4,394,115 $ 5,3(5,725 {
Investments 5,511,922 10,603,501 16,115,423 12,830,242 E
Accounts receivable, net 2,869,415 2,404,088 5,273,503 6,582,597
Interband receivable 132,501 11,083 $(143,584)
Related parties receivable 396,287 554,594 950,881 351,132
Inventory 1,339,639 1,339,639 1,375,457
Prepaid expenses 115,250 170,476 285,726 291,563 tt
4
Total current assets 11 835,531 16,667,340 (143,584) 28,359,287 26,746,716
Restricted assets
Cash and cash equivalents 809,776 809,776 1,451,573
Investments 1,220,355 43,498,724 44,719,079 8,633,657
Notes receivable 32,914 32,914 219,414
Interest receivable 3,087 812,845 815,932 124,864 1
Related parties receivable 758 136,728 137,486 34,261 j
Taxes receivable 15,716 15,716 16,107
Other 1,992 1.992 1,991 jr
l
Total restricted assets 2051.684 44.481.211 - 46.532,895 10.481.867 tr
F
t
The accompanying notes are an integral part of these financial statements.
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i
Water Sewer Combined
Utilitv Utility Eliminations 1999 1998
UABE ITIFS AND FUND EQUITY
Current liabilities
Current portion of notes payable $ 1,462,114 $ 1,462,114 $ 1,414,486
Current portion of obligations under
capital leases 94,694
Accounts payable $ 2,011,120 716,852 2,727,972 2,353,583
Interfund payable 11,083 132,501 $(143,584)
Related parties payable 735,456 334,314 1,069,770 1,094,964
Accrued expenses 285 184,980 185,265 203,018
Accrued compensation 1,571,747 669,363 2,241,110 2,037,750
Deposits for performance bonds and
other charges subject to ref tod 974 974 647
Consumer deposits, advance payments,
and credit available 360,783 360,783 370,241
Total current liabilities 4,691,448 3,500,124 (143,584) 8,047,988 7,559383
Current liabilities payable from
restricted assets
Current portion of certificates of
participation 1,004,077 1,004,077 943,480
Current portion of bonds payable 857,510 857,510 811,085
Accounts payable 32,159 32,159 30,256
Accrued interest payable 82,890 1,666,975 1,749,865 1,059,003
Consumer deposits 1_204,242 1,204,242 871,886
Total current liabilities payable from
restricted assets 2,176,801 2,671,052 4,847,853 3,715,710
r
t
MUNICIPAL WATER DEPARTMENT
OF THE CITY OF SAN BERNARDINO, CALIFORNIA
r
Combining Balance Sheet
June 30, 1999 r
(With Comparative Information for June 30, 1998)
Water Sewer - Combined
Utility Utility Eliminations 1999 - 1998
Property, plant, and equipment,
and water rights - f
Property,Plant, and equipment,and
water rights $89,743,810 $164,009,527 $253,753,337 $250,663,626
Less accumulated depreciation
and amortization (35,716.282) (35.040.037) (70.756319) (64.783.718)
54,027,528 128,969,490 - 182,997,018 185,879,908
Construction in progress 12 637,279 6,347.528 18.984,807 17.659.626
Total property, plant, and S
equipment,and water rights, net 66 664.807 135,317.018 - 201.981.825 203.539.534
i
Other assets
Idle assets 306,446 306,446 254,860
Issuance costs of certificates of
participation and bonds, net of
accumulated amortization 139.144 628,697 767.841 332.968
Total other assets 445.590 628.697 1,074.287 587.828
Total assets $ 80.997,612 $197,094,266 $(143.584) $277,21812L.1241.355.945 i.
1
i
The accompanying notes are an integral pan of these financial statements.
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Water Sewer Combined
Litlllty Utility Eliminations 1999 1998
Long-term debt
Notes payable - $ 30,235,183 $ 30,235,183 $ 31,649,670
Obligations under capital leases 84+694
Certificates of participation 71,665,304 71,665,304 36,487,958
Bonds payable $ 7,362300 7362,500 8,173,584
7,362,500 101,900,487 109,262,987 76,395,906
Less current portion of notes payable (1,462,114) (1,462,114) (1,414,486)
Less current portion of obligations
under capital leases (94+694)
Less current portion payable from
restricted assets f857.51 (1,004,077) (1,861,587) (1,754,5651
Total long-term debt 6,504,990 99,434296 - 105,939286 73,142,161
Total liabilities 13,373,239 105,605,472 $(143,584) 118,835,127 84,417254
Fund equity
Contributed capital 48,165,082 62,327,757 110,492,839 105,862,563
Retained earnings 19,459,291 29 161,037 48,620,328 51,076,128
Total fund equity 67-624,373 91 488,794 - 159,113,167 156,938,691
Total liabilities and fund equity $80 997,612 $197,094,266 $(143,584) 3277,948,294 3241 355 945
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MUNICIPAL WATER DEPARTMENT
OF THE CITY OF SAN BERNARDINO, CALIFORNIA
Combining Statement of Revenues and Expenses
For the Year Ended June 30, 1999
(With Comparative Information for the Year Ended June 30, 1998) f
Water Sewer Combined ({
Utility Utility Eliminations 1999 1998
Operating revenues
Charges for services $14,002,706 $16,908,880 $ (2,231) $30,909,355 $29,184,925
Other operating revenues 1,618,802 153,698 (914,461) 858,039 1,031,209
Total operating revenues 15 621,508 17,062,578 (916,692) 31,767,394 30,216.134
Operating expenses
Administration and customer
service 4,407,015 4,407,015 3,425,776
Engineering, operations, and
distribution administration 162,502 1,094,536 (642,020) 615,018 720,286
Plant operations 3,132,311 5,593,608 (18,445) 8,707,474 8,087,926
Maintemnce 706,639 2,245,803 (188,036) 2,764,406 2,157,612
Environmental control 316,497 (1,079) 315,418 191,988
Distribution 2,411,542 (47) 2,411,495 2,189,241
Engineering 1,055,386 1,055,386 912,797
General,administration, and
overhead 2,605,964 2,244,626 (67,239) 4,783,351 5,045,921
Depreciation and amortization 2,565,002 4,372,398 6,937,400 6,895,258
Bad debt expense 80,391 47,813 128,204 85,833 i
Total operating expenses 17,126,752 15,915,281 (916,866) 32,125,167 29,712,638 t
Operating income(loss) (I 505.244) 1,147,297 174 (357,773) 503,496 i
Nonoperating revenues (expenses)
investment income 521,288 2,905,565 3,426,853 1,929,601
Rental income 41,172 28,965 70,137 79,925
Net loss on capital assets
and inventory items (67,752) (49,324) (117,076) (10,204)
lnterest expense and fiscal charges (357,411) (5,114,507) (5,471,918) (3,946,396) i
Amortization of issuance costs (15,033) (49,203) (64,236) (18,873)
All other-net 54,265 4,122 (174) 58,213 256,043 f
Total nonoperating revenues 1
(expenses) 176,529 (2,274,382) (174) (2,098,027) (1,709,904)
Net loss $0,328,715) $(1,127,085) $ $(2,455,800) $(1206.408)
The accompanying notes are an integral part of these financial statements.
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MUNICIPAL WATER DEPARTMENT
OF THE CITY OF SAN BERNARDINO, CALIFORNIA
Combining Statement of Changes in Fund Equity
For the Year Ended June 30, 1999
(With Comparative Information for the Year Ended June 30, 1998)
Water Sewer Combined
Utility Utility 1999 1998
Contributed capital
Balance,beginning of year $46,236,035 $59,626,528 $105,862,563 $101,659,996
Add nomperating credits and adjustments
. Charges to property owners for capital
purposes:
Contributions in aid of construction 183,549 86,500 270,049 182,946
Impact fees for service connections 384,750 384,750 432,650
Impact fees for capacity rights-
net of repurchases, refunds,and
writeoffs 2,509,110 2,509,110 679,062
Fast trunk line fees 125,099 125,099 102,251
Grants from government agencies
for capital improvements 1,360,748 (19,480) 1,341,268 2.805,658
Balance, end of year 48,165,082 62,327,757 110,492,839 105,862,563
Retained earnings
Balance,beginning of year 20,788,006 30,288,122 51,076,128 52,282,536
Net loss (1,328,715) (1 127.0&5) (2,455,800) (1 206 408)
Balance,end of year 19,459,291 29,161,037 48,620,328 51,076,128
Total equity, end of year $67,624,373 $91,488,794 $159,113,167 $156,938,691
The accompanying notes are an integral part of these financial statements.
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MUNICIPAL WATER DEPARTMENT
OF THE CITY OF SAN BERNARDINO, CALIFORNIA
Combining Statement of Cash Flows
For the Year Ended June 30, 1999
(With Comparative Information for the Year Ended June 30, 1998)
Water Sewer Combined {
Utility UtLliry Eliminations - 1999 1998
Cash flows from operating activities
Operating income(loss) $(1,505,244) $1,147,297 $ (357,947) $ 503,496 i
Adjustments to reconcile operating r4
income(loss)to net cash provided
by operating activities r
Depreciation and amortization 2,565,002 4,372,398 6,937,400 6,895,258 Ft
Bad debt expense 80,391 47,813 128,204 85,821
(Increase)decrease in:
Accounts receivable (346,075) 332,019 (14,056) 297,037
Interfund receivable (19,787) (6,263) $26,050 -
Related parties receivable 44,945 (3,233) 41,712 (43,736)
Inventory (124,719) 160,537 35,818 142,364
Prepaid expenses and other assets 632 5,204 5,836 60,500
Increase(decrease) in: I
Accounts payable 421,800 (45,508) 376,292 (1,360,089)
Interfund payable 6,263 19,787 (26,05 -
Related parties payable 51,498 (76,692) (25,194) 94,123
Accrued expenses (9,254) (8,499) (17,753) 3,825
Accrued compensation 133,663 69,697 203,360 223,540 t
Deposits for performance bonds and !
other charges subject to refund 327 327 599
Consumer deposits, advance
payments, and credit available 322,898 322,898 188,754
Net cash provided by operating
activities 1,622,340 6,014,557 - 7,636,897 7,091,492 r
Cash flows from noncapital and }t
related fmancing activities
Other nonoperating revenues, net 38,549 4,122 - 42,671 239,936
Net cash provided by noncapital 1
and related financing activities 38,549 4,122 - 42,671 239.936 i
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MUNICIPAL WATER DEPARTMENT
OF THE CITY OF SAN BERNARDINO, CALIFORNIA
Combining Statement of Cash Flows
For the Year Ended June 30, 1999
(With Comparative Information for the Year Ended June 30, 1998)
Water Sewer Combined
Utility Utility Eliminations 1999 1998
Cash flows from capital and related
financing activities
Acquisition of property, Plant, and
equipment $(4,287,978) $(1,260,374) $(5,548,352) $ (8,468,376)
Payments received on notes receivable 186,500 186,500 290,188
Charges to property owners for
capital purposes 568,299 2,720,709 3,289,008 1,396,909
Grant proceeds from govemmem
agencies 2,304,171 232,042 2,536,213 2,336,254
Principal payments on antes payable (1,414,487) (1,414,487) (1,369,111)
Proceeds from issuance of long-
term debt 35,612,314 35,612,314 8,018,023
Principal payments under capital leases (84,694) (84,694) (80,339)
Principal payments on certificates of
participation (960,000) (960,000) (9,338,606)
Principal payments on bonds payable (865,000) (865,000) (960,000)
Property taxes received 16,107 16,107
Interest paid (182,717) (4,418,500) (4,701,217) (4,064,711)
Rent payments received 41,172 28,965 70,137 79,925
Net cash provided by(used in)capital
and related financing activities (2,590,640) 30,727,169 $ - 28,136,529 (12,159.844)
Cash flows from investing activities
Proceeds from sale of investments 4,061,752 5,963,575 10,025,327 17,539,514
Purchase of investments (4,730,716) (44,665,214) (49,395,930) (13,855,313)
a Interest received 282242 1,708,857 1,991,099 2030,348
Net cash provided by(used in)
investing activities (386,722) (36,992,782) - (37,379,504) 5,714.549
Net increase(decrease) in cash
and cash equivalents (1,316,473) (246,934) - (1,563,407) 886,133
Cash and cash equivalents at
beginning of year 3,596,766 3,170,532 6,767,298 5,881,165
Cash and cash equivalents at
end of year $2,280,293 $ 2,923,598 $ - $ 5,203,92L--§ 6,767,298
The accompanying notes are an integral part of these financial statements.
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MUNICIPAL WATER DEPARTMENT
OF THE CITY OF SAN BERNARDINO, CALIFORNIA
r
Notes to Combining Financial Statements �r
1. Summary of Significant Accounting Policies i
The Municipal Water Department of the City of San Bernardino, California(a component unit of the City of i
San Bernardino) (the Department) was formed in 1904 under the Charter of the City of San Bernardino. The
Department is governed by a Board of Water Commissioners who are appointed by the Mayor of the City of
San Bernardino. The Charter gives the Board of Water Commissioners semi-autonomous authority to govem
the Department independent of the City Council. The Municipal Water Department of the City of San
Bernardino operates two enterprise funds: the Water Utility Enterprise Fund(Water Utility)and the Sewer
Utility Enterprise Fund(Sewer Utility). The Water Utility also provides administrative services and contracted
services to the Sewer Utility. The accounting policies of the Department conform to generally accepted
accounting principles (GAAP)as applicable to governments.
The preparation of these financial statements requires management to make estimates and assumptions. Those t
estimates and assumptions affect the reported amounts of assets, liabilities, revenues, and expenses, as well t
as the disclosure of contingent assets and liabilities. Actual results could differ from those estimates.
Management also determines the accounting principles to be used in the preparation of the financial statements.
A description of the significant accounting policies employed in the preparation of these financial statements
follows:
Reporting Entity
Generally accepted accounting principles require that these financial statements present the accounts of the
Department and any of its component units. Component units are legally separate entities for which the
Department is considered to be financially accountable or otherwise has a relationship which is such that the
exclusion of the entity would cause the financial statements to be misleading. Blended component units are
considered, in substance, part of the Department's operations, so the accounts of these entities are to be
combined with the data of the Department. Component units which do not meet these requirements are
reported in the financial statements as discrete units to emphasize their separate legal status. The Department
has determined that it has three component units, all of which qualify to be treated as blended component units
as follows:
West End Water Development Treatment and Conservation Joint Powers Authority
On August 15, 1990, the City of San Bernardino joined the West End Water Development, Treatment and
Conservation Joint Powers Authority (WEJPA) as a financing vehicle for construction of water facilities.
v
In accordance with the joint powers agreement, title to the WEJPA constructed water facilities will
automatically vest with the Department in the Water Utility upon repayment of the certificates of participation
issued to fund the construction. The WEJPA is governed by a separate three-member board consisting of one
representative from each agency's governing body. The financial statements for the WEJPA.are available at
the Department.
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MUNICIPAL WATER DEPARTMENT
OF THE CITY OF SAN BERNARDINO, CALIFORNIA
Notes to Combining Financial Statements
1. Summary of Significant Accounting Policies (Continued)
San Bernardino Public Safety Authority
On April 1, 1968, the City of San Bernardino and County of San Bernardino formed the San Bernardino Public
Safety Authority (PSA), a joint powers authority, as a financing vehicle to construct(1) public safety buildings
and (2) improvements to the wastewater treatment plant.
According to the original joint powers agreement, title to the PSA-constructed wastewater treatment facility
will automatically vest in the City with the residual cash being transferred to the City after the bonds are
repaid. PSA is governed by a separate board consisting of three members, one appointed by the San
Bernardino City Council and two members appointed by the San Bernardino County Board of Supervisors.
Effective with the transfer of the Sewer Utility to the Department, all the assets and activities of PSA related
to the wastewater treatment plant were also transferred to the Department pursuant to the enabling resolution
of October 1973 and are included in the Sewer Utility. The financial statements of PSA are available at the
Department.
Colton/San Bernardino Regional Tertiary Treannent
and Water Reclamation Authority
On August 2, 1994, the City of San Bernardino, through the Department, formed a joint powers authority with
the City of Colton to construct, operate, use, and maintain tertiary wastewater treatment, disposal, and water
reclamation systems, including the Regional Rapid Infiltration and Extraction Facility (RIX). The Colton/San
Bernardino Regional Tertiary Treatment and Water Reclamation Authority is governed by a separate board
consisting of four members, two of whom are appointed by the City of San Bernardino through the
Department's Board of Water Commissioners and two appointed by the City Council of the City of Colton.
Construction of the project was administered by the Santa Ana Watershed Project Authority (SAWPA) and
was substantially completed during 1996. Administration and operation of the project was turned over to the
Colton/San Bernardino Regional Tertiary Treatment and Water Reclamation Authority at that time. Title to
the property will be transferred upon final resolution of construction issues. Each of the cities, San Bernardino
and Colton, has an undivided interest in the real property and any related debt of the RIX project based on a
split of 80 percent and 20 percent, respectively. The activities related to the construction, administration and
operation of the RIX project are accounted for in the Sewer Utility. The Sewer Utility is reimbursed by the
City of Colton for a portion of the costs of operating the RIX facility.
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MUNICIPAL WATER DEPARTMENT
OF THE CITY OF SAN BERNARDINO, CALIFORNIA
Notes to Combining Financial Statements
1. Summary of Significant Accounting Policies(Continued)
Fund Accounting
The accounts of the Department are organized and operated on the basis of funds. A fund is an independent i
fiscal and accounting entity with a self-balancing set of accounts. Fund accounting segregates funds according
to their intended purpose and uses them to aid management in demonstrating compliance with finance-related
legal and contractual provisions. The Department's financial statements include only enterprise funds which
are a proprietary fund type. Enterprise funds are used to account for those operations that are financed and
operated in a manner similar to private business or where the Board has decided that the determination of j
revenues earned, costs incurred and/or net income is necessary for management accountability. I
Basis of Accounting
Proprietary funds are accounted for on the flow of economic resources measurement focus and use the accrual
basis of accounting. Under this method, revenues are recorded when earned and expenses are recorded at the
time liabilities are incurred. The Department applies all applicable GASB pronouncements in accounting and
reporting for its proprietary operations and applicable FASBs that occurred prior to November 30, 1989.
Cash and Investments
Cash for the Department is pooled with the City of San Bernardino for investment purposes in order to
maximize interest earnings. Such earnings are credited to the various funds within the City of San Bernardino
based upon average monthly cash balances. The investment policies and the associated risk factors as they
relate to the Department are included in the City's Comprehensive Annual Financial Report. t
For the purpose of the statement of cash flows,cash and cash equivalents include all highly liquid investments
(including restricted assets) with a maturity of three months or less when purchased. r
Receivables
Trade receivables are shown net of an allowance for uncolleedble accounts based on management's estimate.
Interfund Receivables and Payables
Transactions between funds that are representative of lending/borrowing arrangements outstanding at the end
of the fiscal year are referred to as either "interfund receivables/payables" (i.e., the current portion of
interfund loans) or "advances to/from other funds" (i.e., the noncurrent portion of interfund loans). All
interfund transactions are eliminated for financial reporting purposes.
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MUNICIPAL WATER DEPARTMENT
OF THE CITY OF SAN BERNARDINO, CALIFORNIA
Notes to Combining Financial Statements
1. Summary of Significant Accounting Policies (Continued)
Inventories
Inventories are valued at the lower of cost, using the average-cost method, or market.
Restricted Assets
Various resources of the Department are limited as to their use by law or by certificates of participation and
d bond covenants and are classified on the balance sheet as restricted assets. Proceeds of the certificates of
participation and bonds are restricted for the construction of water and sewer system improvements and for
repayments. Assessments collected from property owners are restricted for the payment of bond principal and
interest. Also, fees imposed on new real estate development are restricted by law for the construction of
capital improvements which benefit the development projects.
Issuance Costs and Discount
Issuance costs, discounts, and deferred funding charges for certificates of participation and bonds payable are
being amortized using the effective interest rate method over the term of the related certificate or bond or the
straight-line method which approximates the effective interest method.
Property, Plant, and Equipment and Water Rights
Property, plant, and equipment and water rights are recorded at cost. Major outlays for capital assets and
improvements are capitalized as projects are constructed. Interest incurred during the construction phase is
reflected in the capitalized value of the asset constructed, net of interest earned on the invested proceeds over
the same period, if any. Overhead costs are capitalized at the rate of 24.75 percent of direct construction cost
and are reflected in the capitalized value of the asset constructed. Depreciation has been provided for using
the straight-line method over the estimated useful lives of the related assets. Useful lives for depreciation
purposes are as follows:
Wells, pumping plants, reservoirs, and distribution system 8 to 50 years
Interceptor lines 50 years
Disposal plant 35 to 50 years
Leasehold improvements 5 to 25 years
Shops, offices, stores, and yards 10 to 20 years
Tools and equipment 4 to 20 years
Office equipment 5 to 20 years
Communication equipment 8 to 10 years
Computer equipment 5 to 10 years
Automotive equipment 3 to 8 years
-14-
i
MUNICIPAL WATER DEPARTMENT
OF THE CITY OF SAN BERNARDINO, CALIFORNIA
Notes to Combining Financial Statements
r
1. Summary of Significant Accounting Policies (Continued)
Equipment leased under capital leases is recorded at cost, and amortization has been provided for using the
straight-line method over the estimated useful life. Amortization is included in depreciation expense.
Idle Assets
r
Idle assets consist of water wells, pumping plants, reservoirs, and pipelines not in production. �r
Compensated Absences `
Employees gain a vested right to accumulated unpaid vacation based on years of service but cannot accumulate i
more than two years of accrued vacation. Once each fiscal year, employees with at least three weeks (two }
weeks for managers and mid-management employees) of accrued vacation have the option of receiving
payment at their regular rate of pay for one week of accumulated unpaid vacation. Employees' vacation
benefits are recognized as a liability of the Department.
i
Sick leave is accumulated without limit for each employee at the rate of 3.7 hours per pay period. Leave with
pay is provided when employees are absent for health reasons and employees are entitled to 25 percent of
accumulated sick leave with five years of service and a minimum of 480 hours of accumulated sick leave. . -
Upon retirement or death, employees are entitled to 50 percent of accumulated sick leave up to a maximum
of 1,152 hours. Accrued sick leave benefits are recognized as a liability of the Department.
1
Fund Equity
The Department currently has no reserved retained earnings. The Department's contributed capital represents
equity acquired through capital grants and capital contributions from developers, customers, or other funds.
Comparative Data for Prior Year
Comparative data for the prior year has been presented in selected sections of the accompanying financial
statements for comparative purposes and is not intended to be a complete financial statement presentation. For
comparative purposes, certain amounts presented in the prior year have been reclassified in order to be
consistent with the current year's presentation.
2. Prior Period Adjustment
Fund equity at June 30, 1998 has been adjusted to correct an error in the financial statements for the year
ended June 30, 1998. Contributed capital in the Water Utility has been increased by $564,435 to recognize
grants from government agencies not previously recorded. This restatement has no effect on the amount of
net income previously reported for the year ended June 30, 1998.
-15-
MUNICIPAL WATER DEPARTMENT
OF THE CITY OF SAN BERNARDINO, CALIFORNIA
Notes to Combining Financial Statements
3. Cash and Investments
As of June 30, 1999, the carrying amount of the Department's deposits was$902,105 and the bank balance
was $853,327. Of the bank balance, $143,552 was covered by federal depository insurance (FDIC) and
$709,775 was not collateralized. While the California Government Code requires banking institutions to
pledge a pool of government securities to collateralize their public agency deposits, the collateral pool is not
held in the name of the public agency; consequently, the excess above the FDIC amount is considered
uncollateralized for the purpose of risk classifications under Government Accounting Standards Board
Statement No. 3.
a'
The Department maintains substantially all of its operating funds in the City of San Bernardino Treasury (an
internal investment pool). These funds are reported at market value as determined by quoted market prices.
Investment earnings are deposited quarterly into participating funds. Any investment losses are proportionately
shared by all funds in the internal investment pool.
The Department's cash and investments include the following components:
Cash deposits $ 902,105
Internal investment pool with City of San Bernardino 25,309,381
Investments with fiscal agent 39.826.907
$66.038.393
The Department's investments are categorized as either (1) insured or registered or for which the securities
are held by the Department or its agent in the Departments name, (2) uninsured and unregistered for which
the securities are held by the broker's or dealer's trust department or agent in the Department's name, or(3)
uninsured and unregistered for which the securities are held by the broker or dealer or by its trust department
or agent but not in the Department's name. The Department's investments in the Local Agency Investment
Fund and money market funds have not been categorized because securities are not used as evidence of the
investments but are an ownership interest in pooled investment funds. Investments are categorized at June 30,
_. 1999 as follows:
Category Fair Value
1 2 3 Total
Investments
U.S. Treasury securities $37,276,088 $37,276,088
U.S. Government agencies $12,195,495 17,195,495
Other securities $6,362,917 6,362,917
Local Agency Investment Fund $3,84,711 3,840,711
Money Market Funds $136,578 136,578
Total investments 64,811,789
Cash on hand and deposits 1.226.604
Total cash and investments $66.038.393
-16-
MUNICIPAL WATER DEPARTMENT
OF THE CITY OF SAN BERNARDINO, CALIFORNIA
Notes to Combining Financial Statements
3. Cash and Investments (Continued)
Presented in the balance sheet as:
Cash and cash equivalents
Current assets _ $ 4,394,115
Restricted assets 809.776 r
Total cash and cash equivalents 5.203.891
Investments i
Current assets 16,115,423
Restricted assets 44.719.079 f
Total investments 60.834.502 Il
Total cash and investments $66.038.393
4. Accounts Receivable I
t
Accounts receivable consisted of the following at June 30, 1999: 1
Less Net
Amount Allowance Receivable
Water Utility
Consumer $2,664,670 $261,955 $2,402,715 i
Grant funding 285,998 285,998
Other 211.794 31.092 180.702
3.162.462 293.047 2.869.415
Sewer Utility
Consumer 1,993,509 167,691 1,825,818
Other 591.573 13.303 578.270
2.585.082 180.994 2.404.088
t
Totals $5.747.544 $474.041 $5.273.503
-17-
MUNICIPAL WATER DEPARTMENT
OF THE CITY OF SAN BERNARDINO, CALIFORNIA
Notes to Combining Financial Statements
5. Notes Receivable
Notes receivable at June 30, 1999 consisted of the following:
Sewer Utility
Miscellaneous notes -
Various parties (for collection of sewer capacity fees)
Interest rate: 12%
Repayment provision: Interest and principal due at
maturity in 1999
Balance $32914
Total notes receivable $32 914
6. Restricted Assets
Certain assets are classified as restricted assets because their use is completely restricted by the provisions of
loan or grant agreements or bond covenants. The balances of restricted asset accounts at June 30, 1999 follow:
Water Utility
Customer deposits $ 1,204,067
Funds for debt service on South San Bernardino
Water District Waterworks Bonds, Series C 32,762
Set asides required under 1990 Water facilities certificates of
participation 5,079
Set asides required under series 1998A bonds, project fund 809.776
2.051.684
Sewer Utility
-- Advance sales of capacity rights to property owners
under Resolution 84-271, including any interest earnings,
restricted for capacity expansion expenditures 1,013,897
East Valley Water District connection fees, restricted for
additional interceptor capacity requirements of the District,
including any interest earnings 2,827,560
Construction and other reserves including set asides required
under the 1992 Sewer facilities certificates of participation
and the 1998 refinancing Sewer revenue certificates of
participation 40.639.754
44.481211
Total restricted assets $46.532,895
-18-
MUNICIPAL WATER DEPARTMENT
OF THE CITY OF SAN BERNARDINO, CALIFORNIA
Notes to Combining Financial Statements
7. Property, Plant, and Equipment and Water Rights
A summary of changes in property, plant, and equipment and water rights follows: (l
Additions Retirements
Balance, and and Balance,
June 30. 1998 Transfers-in Transfers-out June 30, 1999
Water Utility
Sundry land, rights-of-way, service
areas, and easements $ 2,372,230 $ 359,787 $ 2,732,017
Water rights, wells, pumping
plants, reservoirs, etc. 29,474,476 775,007 $ 137,916 30,111,567
Distribution systems 48,528,374 976,553 477,387 49,027,540
Shops, office, and store yards 1,139,762 85,143 1,224,905 t
Tools and equipment 1,904,669 84,073 98,913 1,889,829
Automobiles and trucks 2,001,293 99,030 109,406 1,990,917 t
Office leasehold improvements 110,175 257 1,076 109,356 f
Office, computer, and engineering
equipment 2,056,793 134,242 231,136 1,959,899
"E" Street property 54,202 54,202
Radio and interoffice
communications equipment 303,980 735 2,315 302,400
Telemetry systems and equipment 78,450 57,259 135,709
Miscellaneous capital items 155.787 49.682 205.469
88,180,191 $2.621,768 $1,058.149 89,743,810
Less accumulated depreciation
and amordntion 33.979.349 35.716.282
54,200,842 54,027,528
Construction in progress 10.860.326 12.637.279
Total property, plant, and
equipment and water rights, net $65.061.168 $66.664.807 F
Details of changes in construction in progress in the Water Utility follow:
Balance Balance
June 30, 1998 Additions Transfers June 30, 1999
United States Environmental r
Protection Agency Newmark
Groundwater Project $ 7,456,657 $1,247,247 $ 359,664 $ 8,344,240
Other miscellaneous projects 3.401669 2.876.449 1.987.079 4193.039
Totals $10.860.326 $4.123.696 $2.346.743 $11637,279
-19-
L
MUNICIPAL WATER DEPARTMENT
OF THE CITY OF SAN BERNARDINO, CALIFORNIA
Notes to Combining Financial Statements
7. Property, Plant, and Equipment and Water Rights(Continued)
During the year ended Jane 30, 1999, the Department capitalized interest costs of$49,276 in the Water Utility.
Balance, Additions and Balance,
June 30, 1998 Transfers-in Retirements June 30, 1999
Sewer Utility
Iand, rights, and easements $ 12,303,221 $103,200 $ 12,200,021
Buildings and plants 143,252,398 $1,563,730 4,030 144,812,098
Wells and lines 3,192,217 3,192,217
Tools and equipment 2,583,447 144,419 72,115 2,655,751
Automobiles and trucks 499,705 50,172 35,857 514,020
Office and computer equipment 446,054 62,524 72,892 435,686
Miscellaneous capital items 206.393 6.659 199.734
162,483,435 $1.820.845 $294.753 164,009,527
L.ess accumulated depreciation.
and amortization 30.804.369 35.040.037
131,679,066 128,969,490
Construction in progress 6.799.300 6347.528
Total property, plant, and
equipment, net $138.478.366 $135 117.018
Details of changes in construction in progress in the Sewer Utility follow:
Balance, Balance,
June 30, 1998 Additions Transfers June 30, 1999
3
Phase III expansion project $2,614,441 $2,614,441
Other miscellaneous projects 4.184.859 $1.217.528 $1.669300 3.733.087
Totals $6.799.300 $1.217.528 $1.669.300 $6.347.528
During the year ended June 30, 1999, the Department capitalized interest costs of$47,345 in the Sewer Utility.
-20-
r
MUNICIPAL WATER DEPARTMENT
OF THE CITY OF SAN BERNARDINO, CALIFORNIA
Notes to Combining Financial Statements f
l
8. Operating Leases
The Department leases office space from the City of San Bernardino under a noncancellable operating lease
terminating in 2002. The following is a schedule of minimum lease payments as of June 30, 1999:
Office Space
Water Sewer Total r
For the year ending June 30, !
2000 $161,918 $21,802 $183,720
2001 161,918 21,802 183,720
2002 121,439 16351 137.790
$445275 $59,955 $505230 t
Rental expense including equipment rentals for the year ended June 30, 1999 amounted to $216,658. j
9. Long-Term Debt [
The following is a summary of changes in long-term debt obligations for the year ended June 30, 1999: r
Balance, Balance.June 30, 1999
July 1 1998 Additions Reductions Total Current Long-Term
Notes payable $31,649,670 $1,414,487 $ 30,235,183 $1,462,114 $ 28,773,069
Certificates of
participation 36,487,958 $36,111,423 934,077 71,665,304 1,004,077 70,661,227
Bonds payable 8,173,584 811,084 7,362,500 857,510 6,504,990
Obligations under
capital leases 94,694 84.694 r
$76,395,906 $36,111,423 $3,244.342 $109.262,987 $3.323.701 $105,939.286 fE
Notes Payable
S
Santa Ana Watershed Project Authority (SAWPA)
Maturity date: 2011
Interest rate: 3.3%
Repayment provisions: Annual principal and interest l
payments of$279,293
Balances $ 2,730,948
-21-
i
1
MUNICIPAL WATER DEPARTMENT
OF THE CITY OF SAN BERNARDINO, CALIFORNIA
Notes to Combining Financial Statements
9. Long-Term Debt(Continued)
San Bernardino Valley Municipal Water District
Maturity date: 2013
Interest rate: 7.25%
Repayment provisions: Annual principal and interest
payments of$456,250
Balances $ 3,930,979
Santa Ana Watershed Project Authority (SAWPA)
Maturity date: 2016
Interest rate: 2.8%
Repayment provisions: Annual principal and interest
payments of$1,761,739
Balances 23.573.256
30,235,183
Less current portion 1.462.114
Long-term portion $28.773.069
The loan through the Santa Ana Watershed Project Authority from the State Water Resources.Control Board
had been provided for the construction of the San Bernardino/Colton Rapid Infiltration Extraction (RUQ
Project. The loan requires the Department to establish a Wastewater Capital Reserve Sinking Fund(WCRF)
for expansion, major repair or replacement of wastewater treatment works at one-half of one percent of the
total loan amount over a period of ten years. The balance of the WCRF is$650,375 at June 30, 1999.
The Department has decided to use the revenues of the Sewer Utility towards repayment of the loan.
Certificates of Participation
Annual
interest Issue Maturity Original Principal
Rates Date Date Amount hwtaumems Balance
1992 Sewer Treatment Plant 6.25% 1992 2018 $41,300,000 $625,000
to to
9.25% $3,385,000 $35,835,000
1998 Refinmcing Sewer 3.95% 1998 2017 $36,230,000 $1,505,000
to to
5.00% $3,220,000 36,230,000
72,065,000
Less ummortized discount 399.696
71,665,304
Less current portion payable
from restricted assets 1.004.077
Long-term portion $70.661.227
-22-
MUNICIPAL WATER DEPARTMENT [
OF THE CITY OF SAN BERNARDINO, CALIFORNIA
Notes to Combining Financial Statements [
9. Long-Term Debt(Continued) [
The City of San Bernardino's independent bond council has determined that no amounts are currently due. t
under IRS Code Section 148(f)(4)(B) for the temporary investments of the 1992 Sewer Treatment Plant 1
Certificates of Participation and for rebate arbitrage.
During the year, the Department refinanced the acquisition and construction of certain capital improvements r
which were originally financed by the 1992 Sewer Certificates of Participation, dated February 1, 1992. The
refinancing was accomplished by issue of certificates of participation (1998 Refunding Sewer Revenue
Certificates of Participation) in the amount of$36,230,000. The proceeds of the 1998 Certificates are to be
invested and used to pay interest on the 1998 issue until February I, 2001. The 1992 Certificates are callable [
on February 1, 2001 at a prepayment premium of two percent. At that time, the funds from the 1998 issue
will be used to pay off the 1992 Certificates. The Department will then begin paying the installment payments
on the 1998 Certificates from the net revenues of the Sewer system. The Department has covenanted that it
will budget amounts sufficient to make all installment payments due.
Costs related to the issuance of 1998 Certificates have been paid out of the proceeds of the issue. The advance
refinancing has resulted in economic savings to the Department which are the difference between the debt
service payments on the 1992 and 1998 Certificates. The present value of these savings has been computed I
as approximately $1.2 million. These savings were made available to the Department during the year upon
issue of 1998 Certificates and a portion of these proceeds will be used to finance new Sewer capital
improvements.
As of June 30, 1999, $7,026,065 of outstanding 1990 Water Facilities Certificates of Participation are 1
considered in substance defeased through the issuance of the Series 1998A Water and Wastewater Revenue
Bonds (see Bonds Payable) and are not included as a liability of the Department in these financial statements.
Bonds Payable f
Annual t
Interest Issue Maturity Original Principal
Rates Date Date Amount Installments Balance
1998 Water and Wastewater
Revenue Bonds 3.75% 1998 2005 $8,610,000 $860,000
to to
4.40% $1,260,000 $7,750,000 t
Waterworks Bonds, t
Series C 7.75% 1988 2013 $150,000 $5,000
to
$15,000 115.000 f
Total bonds payable 7,865,000 !1
Less umtmortized discount
and deferred advance
refunding charge 502,500
7,362,500
Less current portion payable
from restricted assets 857,51
Long-term portion $6 504,990
23
MUNICIPAL WATER DEPARTMENT
OF THE CITY OF SAN BERNARDINO, CALIFORNIA
Notes to Combining Financial Statements
9. Long-Term Debt(Continued)
The Department has covenanted to set aside Water revenues to make installment payments on the Bonds as
due.
At June 30, 1999, $545,000 of the 1986 Revenue Refunding Bonds of the Sewer facility are considered
defeased and are not included as a liability of the Department in these financial statements.
The annual requirements to amortize long-term debt subsequent to June 30, 1999 are as follows:
s
June 30, Principal Interest Total
Notes payable 2000 $ 1,462,114 $ 1,035,168 $ 2,497,282
2001 1,511,620 985,662 2,497,282
2002 1,563,095 934,187 2,497,282
2003 1,616,637 880,645 2,497,282
2004 1,672,347 824,935 2,497,282
Thereafter 22.409.370 4.792.806 27.202.176
30.235.183 9.453.403 39.688.586
Certificates of participation 2000 1,030,000 4,000,740 5,030,740
2001 1,105,000 3,905,464 5,010,464
2002 2,690,000 3,803,252 6,493,252
2003 2,845,000 3,669,742 6,514,742
2004 3,010,000 3,526,580 6,536,580
Thereafter 61.385.000 26.835.706 88120306
72.065.000 45.74 1,484 117.806.484
Bonds payable 2000 975,000 310,399 1,285,399
2001 1,020,000 272,033 1,292,033
2002 1,060,000 230,490 1,290,490
2003 1,100,000 186,016 1,286,016
2004 1,165,000 138,547 1,303,547
Thereafter 2545.000 146.827 2.691.827
7,865.000 1.284312 9.149.312
$110.165.183 $56.479.199 $166.644.382
-24-
MUNICIPAL WATER DEPARTMENT
OF THE CITY OF SAN BERNARDINO, CALIFORNIA
Notes to Combining Financial Statements
I
10. Defined Benefit Pension Plan
Qualified employees are covered under a multiple-employer contributory retirement plan maintained by an
agency of the State of California, California Public Employees' Retirement System(PERS).
Plan Description
The Department contributes to PERS, an agent multiple-employer public employee retirement system defined
benefit pension plan administered by PERS. All employees who work 1,000 hours or more are eligible to
participate. The plan provides retirement and disability benefits, annual cost-of-living adjustments, and death
benefits to plan members and beneficiaries. Benefit provisions are established by stare statutes, as legislatively -
amended, within the Public Employees' Retirement law. PERS issues a separate comprehensive annual
financial report that includes financial statements and required supplementary information. Copies of the
PERS annual financial report may be obtained from the PERS Executive Office, 400 "P" Street, Sacramento,
California 95814. PERS also issues a separate report on the actuarial valuation of the plan of the City of San l
Bernardino which is available at the Department.
Funding Policy f
Active plan members are required to contribute 7.0 percent of their salary and the Department is required to I
contribute an actuarially determined rate. The actuarial methods and assumptions required employer
contribution rate for fiscal year 1998-99 was -0-percent of annual payroll. The contribution requirements of
the plan members are established by state statute. The Department's contributions of the employer's portion
to PERS for the years ended June 30, 1999, 1998 and 1997 were$-0-, $281,804 and $434,915, respectively,
and equal 100 percent of the required contributions for each year. In addition, the Department has agreed to
"pick up" the contribution required from the employees on their behalf. Such contributions of the employees'
portion for the years ended June 30, 1999, 1998, and 1997 were $607,355, $619,533, and $607,672' The
Department's payroll for employees covered by PERS for the year ended June 30, 1999 was $9,131,384,
which was 98 percent of the Department's payroll.
11. Post-Retirement Health Care Benefits
In addition to the pension benefits described in Note 11, the Department provides post-retirement health care r
benefits to all employees who retire from the Department on or after attaining age 55 with a minimum of 15 IL
years of service. Retirees are allowed to continue on the health care plan at a set premium. Some employees
are eligible to have a portion of that premium reimbursed to them by the Water Department up to $150 per
month per retiree through October 5, 1998 and$217 per month thereafter. Currently, eleven Water Utility
and one Sewer Utility retirees meet those eligibility requirements. The Department pays $16 per month per
retiree to PERS for administrative costs of this program and an additional one-half percent administrative
charge to PERS for all retirees currently covered under the health benefits plan. Expenditures for monthly i
premiums are recognized as incurred. During the year ended June 30, 1999, expenditures of$26,434 were
recognized for post-retirement health care benefits and administrative costs for the Water and Sewer Utilities.
-25-
1
MUNICIPAL WATER DEPARTMENT
OF THE CITY OF SAN BERNARDINO, CALIFORNIA
Notes to Combining Financial Statements
12. Related Party Transactions
Following is a summary of transactions and balances with the City of San Bernardino and its various
departments as of and for the year ended June 30, 1999:
Revenues
City of San Bernardino
Revenue from water charges $ 58,282
Revenue from sewer charges 88,752
Revenue from geothermal energy 13,899
Billing and collections charges - refuse 135,392
Billing and collections charges -storm drain 4,887
New services and mains -installation 5,827
Reimbursement- consulting services 8,633
Interest income 1,575,093
Economic Development Agency
Revenue from geothermal energy 1,778
Reimbursement-consulting services 13.310
Total revenues from related parties $1.905.853
Expenses
City of San Bernardino
10% water revenue $1,423,321
Sewer collection system maintenance 1,331,540
Printing services 5,650
Purchases 1,993
City Hall rent 183,720
Telephone charges 106,858
Refuse disposal services 85,852
Civil Service 45,000
Legal services and Affirmative Action 105,000
Rideshare coordination 2,010
Permits and engineering services 10,291
Postage 8,812
Payroll services 29,000
Data processing services 385,000
Workers' compensation-administration charges 55,248
Miscellaneous charges 4 145
Total expenses to related parties $3.783.440
-26-
MUNICIPAL WATER DEPARTMENT
OF THE CITY OF SAN BERNARDINO, CALIFORNIA
Notes to Combining Financial Statements f
12. Related Party Transactions (Continued)
Receivables
City of San Bernardino
Finance Department $1,033,311
Facilities Management 16,939
Public Services 23,2%
Public Works 5,827
Economic Redevelopment Agency 8,522
Animal Shelter _ 472
Total related parties receivable $1 088 367 t
Payables
Due to the City of San Bernardino Finance Department -
various terms for repayment $l 11)69.770
The Department collects and transmits to the City of San Bernardino ten percent of collections on gross water
revenue and sewer collection system maintenance charges from Sewer Utility customers. These remittances
are included in the related party expense shown above.
The City of San Bernardino is exempt from all water service charges as long as water usage does not exceed
110 percent of the fiscal year 1994/1995 water usage. The value of the exempt water service charges for the
year ended June 30, 1999 was $267,573. rr!
The Department paid $77,353 to SAWPA as administration fees and reimbursement in connection with the t
operation of the RIX project during the year ended June 30, 1999. tttt
13. Contingencies
Grand Jury Investigation
t
The Department is under investigation for alleged violations of the Clean Water Act by the Grand Jury of the t
United States District Court of the Central District of California. Although management denies any material
violations of the Act, the outcome of this investigation or any subsequent actions cannot be determined at this
time with any certainty. If the Department were to be found guilty of violations of the Clean Water Act, it
could be subject to fines, and those fines could be material to these financial statements. -
t
-27-
MUNICIPAL WATER DEPARTMENT
OF THE CITY OF SAN BERNARDINO, CALIFORNIA
Notes to Combining Financial Statements
13. Contingencies (Continued)
Federal and State Grants
Amounts received or receivable from grant agencies are subject to audit and adjustment by grantor agencies,
principally the federal and state governments. Any disallowed claims, including amounts already collected,
may constitute a liability of the Department. The amount, if any, of expenditures which may be disallowed
by the grantor cannot be determined at this time although the Department expects such amounts, if any, to be
immaterial.
Litigation
The Department has filed a complaint against the United States of America, Department of Army, in
connection with alleged contamination of Camp Ono site. This lawsuit is in the discovery phase and an
estimate of recoveries, if any, arising out of this claim cannot be made at this time. The Department incurred
legal expenses of$2,424,616 in connection with this lawsuit during the year ended June 30, 1999.
The Department is a defendant in various other lawsuits. Although the outcome of these lawsuits is not
presently determinable, it is the opinion of the Department's counsel that resolution of these matters will not
have a material adverse effect on the financial condition of the Department.
Commitments
Commitments in the form of signed contracts for costs to complete construction projects or other
improvements amounted to $1,965,782 at June 30, 1999.
Risk Management
Description
The Department's risk management activities are recorded in both of the utility funds. Significant losses are
covered by commercial insurance for all major events except workers' compensation, for which the
Department retains risk of loss in conjunction with the City of San Bernardino's risk management program
for workers' compensation. For insured events, there have been no significant reductions in insurance
coverage. Settlement amounts have not exceeded insurance coverage for the current year or the three prior
years.
Claims Liabilities
The Department records an estimated liability for workers' compensation. Claims liabilities are based on
estimates of the ultimate cost of reported claims (including future claim adjustment expenses) and an estimate
for claims incurred but not reported based on historical experience. Workers' compensation unpaid claims
liabilities are not discounted.
-28-
. f
MUNICIPAL WATER DEPARTMENT f
OF THE CITY OF SAN BERNARDINO, CALIFORNIA
Notes to Combining Financial Statements
13. Contingencies (Continued)
Unpaid Claims Liabilities l
The following represents the changes in approximate aggregate liabilities for the Department for the year
ended June 30, 1999: -
Water Sewer
Utility Utility Total
Liability balance, June 30, 1998 $301,997 $105,253 $407,250
Claims and changes in estimates 279,886 166,900 446,786
Claim payments 327.388 53.366 380.754
Liability balance, June 30, 1999 $254.495 $218.787 $473.282
14. Concentrations
Customers
The Department serves customers located primarily in the City of San Bernardino, the East Valley, and Loma
Linda.
Employee Contracts j
The employees of the Water Department, except for part-time employees and certain management and L
confidential employees, are covered by memorandums of understanding with the Water Department Employees
Association and Association of Water Department Mid-Managers as to wages, hours, and other terms and
conditions of employment. New agreements were signed in April 1999 and are effective for a three-year
period ending March 31, 2002. f
1
4
i
29
t
SUPPLEMENTARY INFORMATION
MUNICIPAL WATER DEPARTMENT !
OF THE CITY OF SAN BERNARDINO, CALIFORNIA
Board of Water Commissioners and Organization f
1
June 30, 1999
MAYOR OF THE CTTY OF SAN BERNARDINO
Judith Valley `
BOARD OF WATER COMMISSIONERS
Name Office r
B. Warren Cocke President t
James H. Urata Commissioner F
Toni Callicon Commissioner II
Martin A. Matich Commissioner
Judith W. Battey Commissioner
ADMINISTRATION
Mr. Bernard C. Kersey
General Manager
Ms. Stacy R. Aldstadt
Deputy General Manager
Mr. Joseph F. Stejskal
Director: Engineering Construction- Maintenance
Mr. John A. Perry, P.E.
Director: Water Reclamation
Mr. John P. Murphy
Director of Finance
Mrs, Marjorie A. Hoverland
Director of Administrative Services
Mr. Jon K. Turnipseed, CSP `1
Safety Program Manager [
ORGANIZATION
i
The City of San Bernardino Municipal Water Department was formed in 1904 under the Charter of the City
of San Bernardino. The Department is governed by a Board of Water Commissioners who are appointed by
the Mayor of the City of San Bernardino. The Charter gives the Board of Water Commissioners semi-
autonomous authority to govern the Department independent of the City Council. The Department operates
two enterprise funds: dte Water Utility Enterprise Fund and the Sewer Utility Enterprise Fund. Water Service
encompasses the City, with the exception of the east end, which is serviced by East Valley Water. Sewer
Services encompass all of the City of San Bernardino, East Valley Water, City of Loma Linda, the farmer
Norton Air Force Base and Patton State Hospital.
-30.
MUNICIPAL WATER DEPARTMENT
OF THE CITY OF SAN BERNARDINO, CALIFORNIA
Schedule of Expenditures of Federal Awards
For the Year Ended June 30, 1999
Federal Receipts
Program Catalog Program or Revenue Program
Title Number Entitlements Recoenized Expenditures
Federal financial assistance
received directly
Environmental Protection Agency
Superfund state site -specific
cooperative agreements(Newmark
groundwater contamination site) -
major program 66.802 $14.205337 $1.360.748 $1.360,748
Total Environmental Protection Agency 14,205.737 1.360.748 L360.748
Total federal awards $14.205.737 $1,360.748 $1,360.748
This schedule is presented on the accrual basis of accounting.
-31-
MUNICIPAL WATER DEPARTMENT
OF THE CITY OF SAN BERNARDINO, CALIFORNIA
Schedule of Insurance Coverage r�
Insurance coverage for the Department at June 30, 1999 is summarized below: 1
Reliance National Insurance Company, Policy #NCZC0146458; boiler and machinery 111
coverage - April 30, 1999 to April 30, 2000
Per occurrence limit $10,000,000
Multiple insurance companies and policies, all-risk property coverage, including r
earthquake and flood -April 30, 1999 to April 30, 2000 as follows: t
Primary limit-
AIG/Lexington Insurance Company, Policy #8799715 $2,500,000
Excess limits -
Commonwealth Insurance Company, Policy#US2392 $3,750,000
Caliber One Indemnity Company, Policy #ZS1001035-01 $3,750,000
TIG Insurance Company, Policy#XPT38797206 $5,000,000
Essex Insurance Company, Policy #MSP3425 $5,000,000
Northfield Insurance Company, Policy #CF001277 $5,000,000
Insurance Company of the West, Policy#XH0170103100 $10,000,000
Agricultural Insurance Company, Policy #CPP3994611 $6,000,000
Greenwich Insurance Company, Policy#ACG3394611 $4,000,000
TIG Insurance Company, Policy #XPT3879206 $5,000,000
Hudson Insurance Company, Policy #HD0041 $8,000,000
Diamond Insurance Company, Policy #IM29423 $4,500,000
Clarendon National Insurance Company, Policy#AR98000480 $7,500,000
Gulf Underwriters Insurance Company, Policy#FXI,421908 $5,000,000
Westchester Fire Insurance Company, Policy #FXL421908 $50,000,000
Reliance Insurance Company, Policy #JK2838890; general liability and personal
injury liability -October 30, 1998 to October 30, 1999 r
Per occurrence limit $1,000,000 it
Personal and advertising injury limit $1,000,000
Fire damage limit $50,000
Medical expense limit(any one person) $5,000 j
General aggregate limit $2,000,000 t
Products/completed operations aggregate limit $2,000,000
Reliance Insurance Company, Policy#JK2838890; commercial automobile
coverage -October 30, 1998 to October 30, 1999
Bodily injury/property damage - combined single limit $1,000,000
Uninsured motorist $1,000,000
Medical expense $5,000
Hired/nonowned liability $1,000,000 -.
-32-
k
MUNICIPAL WATER DEPARTMENT
OF THE CITY OF SAN BERNARDINO, CALIFORNIA
Schedule of Insurance Coverage (Continued)
Reliance Insurance Company, Policy #KX2838890; commercial umbrella
liability policy -October 30, 1998 to October 30, 1999
Per occurrence limit $15,000,000
Products/completed operations aggregate $15,000,000
General aggregate $15,000,000
American International Specialties Lines, Policy #2673997; pollution liability
policy - October 29, 1998 to October 30, 2001
Third-Party Claims, On-Site Property Damage (each incident/aggregate) $5,000,000
Third-Party Claims, On-Site Bodily Injury (each incident/aggregate) $5,000,000
Tbird-Party Claims, Off-Site Cleanup of New Conditions (each incident/aggregate) $5,000,000
Third-Party Claims, Off-Site Property Damage(each incidentlaggregate) $5,000,000
Third-Party Claims, Off-Site Bodily Injury (each incident/aggregate) $5,000,000
Reliance Insurance Services, Policy #SV 1653393; public official
and employee liability policy - October 30, 1998 to October 30, 1999 $5,000,000
AIG/National Union Fire Insurance Company, Policy #8572085; employment
practices liability policy -October 30, 1998 to October 30, 1999 $5,000,000
The Department is self-insured through the City of San Bernardino for workers' compensation liability and
material damage to rolling stock.
-33-
MUNICIPAL WATER DEPARTMENT
OF THE CITY OF SAN BERNARDINO, CALIFORNIA
Schedule of Water System Demographics [
Physical Changes in Water Utility System [
1999
,1.v 1. 1998 Added Removed .tune 30. 1999 [
Miles of main in system 550.5525 1.5752 .6074 551.5203
Crate valves in system 14,233 156 10 14,379 t
Fire hydrants in system 4,110 11 4 4,117 l
Water meters in system 44,565 2,359 2,174 44,750
1998
July 1. 1997 Added Removed .Tune 30. 1998
Miles of main in system 550.4499 .1178 .0152 550.5525 [
Gate valves in system 14,136 99 2 14,233
Fire hydrants in system 4,105 9 4 4,110 r
Water meters in system 44,397 2,644 2,476 44,565
Water Production/Utilization (Cubic Feet) F
1998-99 1997-98 1996-97
Water utilization (shown in cubic feet) r
Water sold to direct customers 1,803,696,500 1,596,392,100 1,810,738,700 Il
Water sold to other agencies 125,883,794 140,192,330 108,660,884
Water sold to or used by City* 90.117.117 79.698.816 91.775.960
2,019,697,411 1,816,283,246 2,011,175,544
Loss and other Factors 150,371,654 133,365,478 112,450,699
Loss and other factors percentage 6.929% 6.840% 5.295% [
Total water sold, used or lost 2.170.069.0652.170.069.065 19.648.724 2.123.626.2432.123.626.243 f
L
t
I
*Includes exempt water used by the City in the amount of 65,326,800 cubic feet for 1998-99 and 51,558,300 i
cubic feet for 1997-98.
-34 l
t
MUNICIPAL WATER DEPARTMENT
OF THE CITY OF SAN BERNARDINO, CALIFORNIA
Schedule of Water Production
June 30, 1999
1998-99 1997-98 1996.97
Total Water Total Water Total Water
Per 1,000 Per 1,000 Per 1,000
Amount Cubic Feet Amount Cubic Feet Amount Cubic Feet
Summary of total water
production and purchased cost
Total production, Purchases, and
supplemental 2,170,069 1,949,649 2,123,626
Production and pumping expenses* $2.985.298 $2.526.300 $2.874.992
Total expense before depreciation 2,985,298 $1.37567 2,526,300 $1.29577 2,874,992 $1.35381
Depreciation of plant facilities 925.290 .42639 870.338 .44641 878.349 .41361
Totals $3.910.588 $1.80206 $3.396.638 $1.74218 $3.753.341 $1.76742
Summary of costs per acre foot
Acre feet 49,817.931 44,757.776 48,751_750
Cost per acre foot before
depreciation $59.92 $56.44 $58.97
Cost per acre foot(including
depreciation of plant facilities) $78.50 $75.89 - $76.99
s
4
*Includes operations administration.
-35-
MUNICIPAL WATER DEPARIW ENP
OF THE CITY OF SAN BERNARDINO, CALIFORNIA
t
Schedule of Water Rates
Water rates are summarized below:
Single Family Dwelling Unit t
Minimum Monthly Charge j
Meter Effective Dates Cubic Foot
Size April 1. 1991 November 1. 1989 Allowance
5/8" $6.60 $5.50 500
3/4" $8.80 $7.35 500
t" $10.55 $8.80 500
1-1/2" $18.90 $15.75 500
2" $26.40 $22.00 500
3" $44.90 $37.40 500 1
4" $76.25 $63.55 500
6" $137.30 $114.40 500
8" $205.90 $171.60 500
10" $257.40 $214.50 500
12" $308.90 $257.40 500
All water usage in excess of 500 cubic feet per month is at the rate of $32 and $.60 per 100 cubic feet _
effective April 1, 1991 and November 1, 1989, respectively.
Commercial, Landscape, and Industrial Users
Minimum Monthly Charge
Meter Effective Dates
Size April 1. 1991 November 1. 1989
5/8" $6.60 $5.50
3/4" $8.80 $7.35 {
1" $10.55 $8.80
1-1/2" $18.90 $15.75
2" $26.40 $22.00
3" $44.90 $37.40
4" $76.25 $63.55
6" $137.30 $114.40
8" $205.90 $171.60
10" $257.40 $214.50
12" $308.90 $257.40
All water usage per month is at the rate of$32 and $.60 per 100 cubic feet effective April 1, 1991 and
November I, 1989, respectively.
-36-
MUNICIPAL WATER DEPARTMENT
OF THE CITY OF SAN BERNARDINO, CALIFORNIA
Schedule of Water Rates (Continued)
Delrnamt Heights Users (Customers formerly
served by Southern California Water Company)
Minimum Monthly Charge
Meter Effective Dates
Size April 1. 1991 November 1. 1989
5/8" $4.60 $4.60
3/4" $5.50 $5.50
V $8.80 $8.80
I-112" $13.80 $13.80
2" $14.90 $14.90
3" $26.60 $26.60
4" $35.00 $35.00
6" $58.50 $58.50
8" $84.00 $84.00
Water usage charge on the first 300 cubic feet is at the rate of$.70 per 100 cubic feet with water usage over
300 cubic feet at the rate of$.844 per 100 cubic feet for the effective dates of April 1, 1991 and November 1,
1989.
Effective July 1, 1995, water furnished for municipal use to the City of San Bernardino is exempt from all
water service charges as long as water usage does not exceed 110 percent of the fiscal year 1994/1995 water
usage. Water usage in excess of this amount is charged at$.288 per 100 cubic foot. Water furnished for use
by the City of San Bernardino for landscape assessment districts or funded from other than the City's general
fund is charged at$.288 per cubic foot. All other rates remained unchanged.
-37-
MUNICIPAL WATER DEPARTMENT
OF THE CITY OF SAN BERNARDINO, CALIFORNIA
Schedule of Sundry Water Statistical Data
1998-1999 1997-1998 I
Production Percent Production Percent
in Cubic Feet Production in Cubic Feet Production I
Perris Hill 8,395,500 0.40% 12,082,300 0.66%
Sierra Way and 16th Street 25,123,000 1.20 108,345,300 5.90
Antil pumping 83,555,100 4.01 110,558,300 6.02
Waterman Avenue pumping 24,299,200 1.16 65,645,000 3.57
Mill and "D" Streets 20,915,000 1.00 24,489,400 1.33
Lytle Creek#1 and#2 238,430,635 11.43 211,407,612 11.51
Secombe well -7th Street plants 27,558,400 1.32 121,139,100 6.59
Cajon Pass and Vincent plant 119,104,800 5.71 107,585,000 5.86
Devils Canyon#1 - 97 107,871,930 5.17 114,549,050 6.23 I
Newmark#1 - #4 166,982,400 8.00 173,641,100 9.45
19th Street#1 and#2 80,904,000 3.88 148,340,400 8.07
Gilbert Street 16,437,500 0.79 60,684,800 3.30
Lynwood 43,621,500 2.09 83,322,600 4.53
27th Street 4,033,200 0.19 5,933,200 0.32
Baseline and California plant 33,485,800 1.61 22,726,800 1.24
Ellena Bros. well
Cajon#1, #2 and#3 155,952,000 7.48 159,063,000 8.66
Mallory well and reservoir 28,969,900 1.39 25,900,300 1.41
30th and Mountain View 34,669,100 1.66 41,095,062 2.24
Olive and Garner well 105,386,500 5.05 45,237,800 2.46
LeRoy Street well 40,226,700 1.93 19,167,100 1.04
10th and `J" Street 61,746,500 2.96 42,676,300 2.32
Kenwood well 123,904,000 5.94 129,339,300 7.04
40th Street well 4,084,800 0.20 4,508,800 0.25 r
EPA wells 530.532.200 25.43
2,086,189,665 100.00 1,837,437,624 100.00
Exchange water from Fast i
Valley Water Department 83X9,400 112211.100 1
Total produced water 2J70,069,065 100 00% 1949.648324 100.00%
-38-
1996-1997 19951996 19941995
Production Percent Production Percent Production Percent
in Cubic Feet Production in Cubic Feet Production in Cubic Feet Production
14,056,300 0.72% 14,056,300 0.71% 37,643,000 2.17%
133,142,700 6.85 133,142,700 6.75 139,819,300 8.07
85,263,000 4.39 85,263,000 4.32 95,007,700 5.48
56,160,500 2.89 56,160,500 2.85 56,777,000 3.27
17,000,700 0.88 17,000,700 0.86 19,770,300 1.14
167,509,300 8.62 196,365,448 9.95 87,336,700 5.04
93,492,100 4.81 93,492,100 4.74 104,208,096 6.01
112,502,300 5.79 112,502,300 5.71 81,299,500 4.69
128,098,120 6.59 128,098,120 6.50 92,209,070 5.32
233,582,200 12.02 233,582,200 11.85 176,697,800 10.19
136,200,800 7.01 136,200,800 6.91 139,418,900 8.04
117,855,900 6.07 117,855,900 5.98 91,160,000 5.26
136,705,700 7.04 136,705,700 6.93 87,714,100 5.06
9,015,400 0.46 9,015,400 0.46
19,434,900 1.00 19,434,900 0.99 32,483,100 1.87
155,425,400 8.00 155,425,400 7.88 151,949,400 8.76
9,292,800 0.48 9,292,800 0.47 5,207,400 0.30
74,113,000 3.81 74,113,000 3.76 94,234,800 5.44
87,164,300 4.49 87,164,300 4.42 64,071,600 3.70
5,903,700 0.30 5,903,700 0.30 4,300,200 0.25
12,346,200 0.64 12,346,200 0.63 35,202,900 2.03
132,997,600 6.85 132,997,600 6.75 134,547,300 7.76
5,552,200 0.29 5,552,200 0.28 2,590,700 0.15
s 1,942,815,120 100.00 1,971,671,268 100.00 1,733,648,866 100.00
120.321.000 120.321.000
2.063.136.120 100.00% 2.091.992.268 100.00% 1333.648.866 100.00%
-39-
MUNICIPAL WATER DEPARTMENT
OF THE CITY OF SAN BERNARDINO, CALIFORNIA
WATER UTILITY
Schedule of Service Area and Customers
Number of Active Connections by Classification of User [
as of June 30, 1995 through June 30, 1999 t
User Type 1999 1998 1997 1996 1995
Single family residential 32,062 31,692 32,105 32,202 32,219 [
Multiple family residential 2,798 2,830 2,870 2,900 2,931
Commercial/institutional 3,336 3,268 3,126 3,115 3,146 [
Other 1.253 1.345 1.267 1,200 1.152
Total all users, active 39,449 39.135 39.368 39.417 39.448
Revenue by Class of User
Fiscal Year 1998-99
Fiscal Year Percentage of
User Class Revenue Annual Revenue
Single family residential $ 7,087,976 51.00%
Multiple family residential 2,223,679 16.00
Commercial/industrial 3,474,498 25.00 i
Other and unmetered 1.111.839 8.00 t
Total all users $13.897.992 100.00%
1
4
i
i
Largest users: The System had no customer accounting for more than three percent of the revenues for the
fiscal year 1998-99.
-40-
MUNICIPAL WATER DEPARTMENT
OF THE CITY OF SAN BERNARDINO, CALIFORNIA
Schedule of Sewer Rates and Statistics
Regional
Facilities
and Collection
Treatment System Total Monthly
Classification Charee Charee City Charee
Rates effective as of June 1, 1995:
Residential $13.25 per month $1.35 per month $14.60
Commercial:
Multi-family, mobile home parks
(4 or more units) $0.75/14CF* $0.151HCF $0.90/HCF*
Retail, commercial, light industrial
(non-office, bakeries, markets,
theaters, dry cleaners) $1.10/HCF* $0.15/HCF* $1.25/14CF*
Auto repair, car wash $1.20/HCF* $0.15 1HCF* $1.35/HCF*
Offices, motels (without restaurants) $0.95/HCF* $0.15/HCF* $1.10/HCF*
Restaurants, hotels(hotels/motels
with restaurants) $1.70 1HCF* $0.15/HCF* $1.85/HCF*
Laundromats $0.90/HCF* $0.15/HCF* $1.051HCF*
Hospitals, convalescent homes $0.80/HCF* $0.15/HCF* $0.95/HCF*
Schools, churches, nursery schools,
daycares $0.50/HCF* $0.15/HCF* $0.65/HCF*
Industry $826.67/MG $264.22/1,000 LBS BOD
(Discharge flow) $324.28/1,000 LBS SS
Rates effective as of January 1, 1994:
Residential $13.55 per month $1.35 per month $14.90
Commercial:
Multi-family, mobile home parks
(4 or more units) $0.801IICF* $0.15/HCF $0.95/14CF*
y Retail, commercial, light industrial
(nonoffice, bakeries, markets,
theaters, dry cleaners) $1.15/HCF* $0.15/HCF* $1.30/HCF*
Auto repair, car wash $1.25/HCF* $0.15/HCF* $1.40/HCF*
Offices, motels (without restaurants) $1.00/14CF* $O.15/HCF* $1.15[HCF*
Restaurants, hotels (hotels/motels
with restaurants) $1.75/HCF* $0.15/HCF* $1.90/HCF*
Laundromats $0.95/HCF* $0.15/HCF* $1.10/HCF*
Hospitals, convalescent homes $0.85/HCF* $0.15/HCF* $1.00/HCF*
Schools, churches, nursery schools,
daycares $0.55/HCF* $0.15/HCF* $0.70/HCF*
Industry $908.33/MG $264.22/1,000 LBS BOD
(Discharge flow) $324.28/1,000 LBS SS
*HCF = Per 100 cubic feet of water usage.
-41-
MUNICIPAL WATER DEPARTMENT
OF THE CITY OF SAN BERNARDINO, CALIFORNIA
Schedule of Sewer Rates and Statistics (Continued)
.tune 30. 1999
Residential Nonresidential Pole!
Number of connections
City of San Bernardino 32,553 3,718 36,271
East Valley Water District 16,613 1,176 172789
City of Loma Linda 3.444 818 4.262 `
52.610 5.712 58.322 [
Annual billings
City of San Bernardino* $5,126,734 $4,691,828 $ 9,818,562 f
East Valley Water District 2,631,064 1,486,077 4,117,141
City of Loma Linda 539.410 841.448 1.380.858
$8.297.208 $7.019353 $15.316.561
Average monthly billings
City of San Bernardino $427,228 $390,986 $ 818,214
East Valley Water District 219,255 123,840 343,095
City of Loma Linda 44952 70.121 115.073
$691435 $584.947 $1.276.382 t
t
I
{
I
*The billings to the City of San Bernardino are net of collection system costs.
-42-
June 30, 1998 .tune 30, 1997
Residential Nonresidential Total Residential Nonresidential Total
32,517 3,711 36,228 32,693 3,723 36,416
16,420 1,089 17,509 15,526 1,106 16,632
3.438 545 3.983 3.119 554 3.673
52,375 5.345 57.720 51.338 5.383 56321
$5,091,718 $4,505,248 $ 9,596,966 $5,183,721 $4,919,644 $10,103,365
2,588,101 1,402,504 3,990,605 2,571,861 1,457,114 4,028,975
537.770 862.410 1.400.180 491.122 790.874 1,281,996
$8.217.589 $6.770.162 $14,987,751 $8.246.704 $7,167,632 $15.414.336
$424,310 $375,437 $ 799,747 $431,977 $409,970 $ 841,947
215,675 116,875 332,550 214,322 121,426 335,748
44.814 71.867 116.681 40.927 65.906 106.833
$684,799 $564.179 $1,248,978 $687,226 $597,302 $L284.528
-43-
MUNICIPAL WATER DEPARTMENT 1
OF THE CITY OF SAN BERNARDINO, CALIFORNIA
Schedule - 1992 Certificates of Participation
San Bernardino Public Safety Authority
June 30, 1999 l
Principal
Principal Unamortized Payments Interest
Date Due Payments Discounts (Net) Interest Total Rate
8-1-1999 $ 1,151,869 $ 1,151,869 9.25%
2-1-2000 $ 1,030,000 $ 16,520 $ 1,013,480 1,151,869 2,165,349 9.25%
8-1-2000 1,104,231 1,104,231 9.25% f
2-1-2001 1,105,000 16,520 1,088,480 1,104,231 2,192,711 9.25% t
8-1-2001 1,053,125 1,053,125 6.25%
2-1-2002 1,185,000 16,520 1,168,480 1,053,125 2,221,605 6.25%
8-1-2002 1,016,094 1,016,094 6.25%
2-1-2003 1,270,000 16,520 1,253,480 1,016,094 2,269,574 6.25%
8-1-2003 976,406 976,406 6.25% r
2-1-2004 1,360,000 16,520 1,343,480 976,406 2,319,886 6.25%
8-1-2004 933,906 933,906 6.25%
2-1-2005 1,460,000 16,520 1,443,480 933,906 2,377,386 6.25% r
8-1-2005 888,281 888,281 6.25%
2-1-2006 1,565,000 16,520 1,548,480 888,281 2,436,761 6.25%
8-1-2006 839,375 839,375 6.25%
2-1-2007 1,680,000 16,520 1,663,480 839,375 2,502,855 6.25%
8-1-2007 786,875 786,875 6.25%
2-1-2008 1,800,000 16,520 1,783,480 786,875 2,570,355 6.25%
8-1-2008 730,625 730,625 6.25%
2-1-2009 1,930,000 16,520 1,913,480 730,625 2,644,105 6.25%
8-1-2009 670,312 670,312 6.25%
2-1-2010 2,070,000 16,520 2,053,480 670,312 2,723,792 6.25% [
8-1-2010 605,625 605,625 6.25%
2-1-2011 2,220,000 16,520 2,203,480 605,625 2,809,105 6.25%
8-1-2011 536,250 536,250 6.25%
2-1-2012 2,385,000 16,520 2,368,480 536,250 2,904,730 6.25%
8-1-2012 461,719 461,719 6.25%
2-1-2013 2,555,000 16,520 2,538,480 461,719 3,000,199 6.25%
8-1-2013 381,875 381,875 6.25%
2-1-2014 2,740,000 16,520 2,723,480 381,875 3,105,355 6.25%
8-1-2014 296,250 296,250 6.25%
2-1-2015 2,940,000 16,520 2,923,480 296,250 3,219,730 6.25%
8-1-2015 204,374 204,374 6.25%
-44-
MUNICIPAL WATER DEPARTMENT
OF THE CITY OF SAN BERNARDINO, CALIFORNIA
Schedule — 1992 Certificates of Participation
San Bernardino Public Safety Authority (Continued)
June 30, 1999
Principal
Principal Unamortized Payments Interest
Date Due Payments Discounts (Net) Interest Total Rate
2-1-2016 $ 3,155,000 $ 16,520 $ 3,138,480 $ 204,375 $ 3,342,855 6.25%
8-1-2016 105,781 105,781 6.25%
2-1-2017 3.385.000 9.681 3.375.319 105.784 3.481.103 6.25%
'i
$35.835.000 $290.521 $35.544.479 $25.485.950 $61.030.429
?5
Funds used for the Primary Hydraulic Reliability Project, remodel of the administration laboratory building,
and design of 3A secondary treatment.
-45-
MUNICIPAL WATER DEPARTMENT f
OF THE CITY OF SAN BERNARDINO, CALIFORNIA
Schedule - 1998 Refunding Sewer Revenue Certificates of Participation `
San Bernardino Public Safety Authority `
June 30, 1999 r
Principal tt
Principal Unannirtized Payments Interest
Date Due Payments Discounts (Vet) Interest Total Rate
8-1-1999 $ 848,501 $ 848,501 3.95%
2-1-2000 $ 9,403 $ (9,403) 848,501 839,098 3.95%
8-1-2000 848,501 848,501 3.95%
2-1-2001 9,403 (9,403) 848,501 839,098 3.95%
8-1-2001 848,501 848,501 3.95%
2-1-2002 $ 1,505,000 9,403 1,495,597 . 848,501 2,344,098 3.95%
8-1-2002 818,777 818,777 4.05%
2-1-2003 1,575,000 9,013 1,565,987 818,777 2,384,764 4.05%
8-1-2003 786,884 786,884 4.10%
2-1-2004 1,650,000 8,604 1,641,396 786,884 2,428,280 4.10%
8-1-2004 753,059 753,059 4.15%
2-1-2005 1,730,000 8,176 1,721,824 753,059 2,474,883 4.15%
8-1-2005 717,161 717,161 4.25%
2-1-2006 1,815,000 7,727 1,807,273 717,161 2,524,434 4.25% L
8-1-2006 678,593 678,593 4.30%
2-1-2007 1,910,000 7,257 1,902,743 678,593 2,581,336 4.30%
8-1-2007 637,528 637,528 5.00%
2-1-2008 2,010,000 6,760 2,003,240 637,528 2,640,768 5.00%
8-1-2008 587,278 587,278 4.50%
2-1-2009 2,125,000 6,238 2,118,762 587,278 2,706,040 4.50%
8-1-2009 539,465 539,465 4.70%
2-1-2010 2,240,000 5,687 2,234,313 539,465 2,773,778 4.70% r
8-1-2010 486,825 486,825 5.00% t
2-1-2011 2,365,000 5,105 2,359,895 486,825 2,846,720 5.00%
8-1-2011 427,700 427,700 4.75% '
2-1-2012 2,510,000 4,492 2,505,508 427,700 2,933,208 4.75% 1
8-1-2012 368,088 368,088 4.85%
2-1-2013 2,650,000 3,840 2,646,160 368,088 3,014,248 4.85%
8-1-2013 303,825 303,825 4.75% i
2-1-2014 2,805,000 3,152 2,801,848 303,825 3,105,673 4.75%
8-1-2014 237,206 237,206 5.25%
2-1-2015 2,965,000 2,424 2,962,576 237,206 3,199,782 5.25%
8-1-2015 159,375 159,375 5.00%
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MUNICIPAL WATER DEPARTMENT
OF THE CITY OF SAN BERNARDINO, CALIFORNIA
Schedule - 1998 Refunding Sewer Revenue Certificates of Participation
San Bernardino Public Safety Authority (Continued)
June 30, 1999
Principal
Principal Unamortized Payments Interest
Date Due Payments Discounts (Net) Interest Total Rate
2-1-2016 $ 3,155,000 $ 1,655 $ 3,153,345 $ 159,375 $ 3,312,720 5.00%
8-1-2016 80,500 80,500 5.00%
2-1-2017 3.220.000 836 3219.164 80.500 3.299.664 5.00%
$36.230.000 $109.175 $36.120.825 $20255.534 $56.376359
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w
v
MUNICIPAL WATER DEPARTMENT
OF THE CITY OF SAN BERNARDINO, CALIFORNIA
Series 1998A Water and Wastewater Revenue Bonds I
Unamortized I
Discounts
and Principal
Principal Deferred Payments Interest I
Date Due Payments Charees (Net) Interest Total Rate
10-1-1999 $ 970,000 $117,490 $ 852,510 $ 159,837 $1,012,347 3.75%
4-1-2000 141,650 141,650 3.75%
10-1-2000 1,015,000 104,149 910,851 141,650 1,052,501 3.90%
4-1-2001 121,857 121,857 3.90%
10-1-2001 1,055,000 89,671 965,329 121,858 1,087,187 4.05% t
4-1-2002 100,494 100,494 4.05%
10.1-2002 1,095,000 74,016 1,020,984 100,494 1,121,478 4.15% I
41-2003 77,772 77,772 4.15%
10-1-2003 1,160,000 57,338 1,102,662 77,773 1,180,435 4.20%
4-1-2004 53,412 53,412 4.20% t
10-1-2004 1,195,000 39,360 1,155,640 53,413 1,209,053 4.30%
4-1-2005 27,720 27,720 4.30%
10-1-2005 L260.000 20.476 L239.524 27.720 1,267,244 4.40%
$7,750,000 $502.500 $7.247.500 $1.205.650 $8,453,150
i
!ci
1
`I
t
Funds used to defease and prepay 1990 Certificates of Participation issued to finance construction of reservoirs,
wells and mains, and to fnuutce future improvements of Water Facilities.
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MUNICIPAL WATER DEPARTMENT
OF THE CITY OF SAN BERNARDINO, CALIFORNIA
Bond Schedule- General Obligation Waterworks Bonds, Series C
Interest
Date Due Payments Interest Total Rate
9-1-1999 $ 4,456 $ 4,456 7.75%
3-1-2000 $ 5,000 4,456 9,456 7.75%
9-1-2000 4,263 4,263 7.75%
3-1-2001 5,000 4,263 9,263 7.75%
9-1-2001 4,069 4,069 7.75%
3-1-2002 5,000 4,069 9,069 7.75%
9-1-2002 3,875 3,875 7.75%
3-1-2003 5,000 3,875 8,875 7.75%
9-1-2003 3,681 3,681 7.75%
3-1-2004 5,000 3,681 8,681 7.75%
9-t-2004 3,488 3,488 7.75%
3-1-2005 5,000 3,488 8,488 7.75%
9-1-2005 3,294 3,294 7.75%
3-1-2006 10,000 3,294 13,294 7.75%
9-1-2006 2,906 2,906 7.75%
3-1-2007 10,000 2,906 12,906 7.75%
9-t-2007 2,519 2,519 7.75%
3-1-2008 10,000 2,519 12,519 7.75%
9-1-2008 2,131 2,131 7.75%
3-t-2009 10,000 2,131 12,131 7.75%
9-1-2009 1,744 1,744 7.75%
3-1-2010 10,000 1,744 11,744 7.75%
9-1-2010 1,356 1,356 7.75%
3-1-2011 10,000 1,356 11,356 7.75%
9-1-2011 969 969 7.75%
3-1-2012 10,000 969 L0,969 7.75%
9-1-2012 580 580 7.75%
3-1-2013 15.000 580 15.580 7.75%
$115.000 $78.662 $193.662
Bonds related to water system improvements for South San Bernardino Water District, which was acquired by
the Department in 1991.
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MUNICIPAL WATER DEPARTMENT
OF THE CITY OF SAN BERNARDINO, CALIFORNIA .
Year 2000 Issue t
The Year 2000 Issue is the result of shortcomings in many electronic data processing systems and other
electronic equipment that could have adversely affected the Department's operations as early as fiscal year
1999.
The Municipal Water Department of the City of San Bernardino, California has completed an inventory of
computer systems and other electronic equipment that may be affected by the Year 2000 Issue and that are
necessary to conducting Department operations. Based on this inventory, the Department identified the E
following systems requiring year 2000 remediation:
• Financial reporting system and payroll and employee benefit system. The Department has completed all
testing and validation on these systems.
• Utility billing system. As of June 30, 1999, the Department was in the process of remediating its utility
billing system; validation and testing of this system were not yet completed. Remaining contracted
amounts of$336,495 were committed to this project as of June 30, 1999.
ttt
• Telephone system. As of June 30, 1999, the Department was in the process of determining how best to t
remediate the issues identified with this system. It is anticipated that commercial. vendors will be
contracted to install a new telephone system, which will include the testing and validation of the system,
upon completion of installation.
• The Department is relying on the City of San Bernardino for year 2000 readiness of certain systems in the t
City Hall premises where a portion of Department personnel and a significant portion of Department {[
operations are conducted. The City of San Bernardino reports that the systems critical to conducting
operations have been tested and validated. r
• The Department has completed testing and validation on all other electronic equipment it identified as
necessary to conducting Department operations. `
Because of the unprecedented nature of the Year 2000 Issue, its effects and the success of related remediation [l
efforts will not be fully determinable until the year 2000 and thereafter. Management cannot assure that the t
Department is or will be year 2000 ready, that the Department's remediation efforts will be successful in whole t
or in part, or that parties with whom the Department does business will be year 2000 ready. l
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