Loading...
The URL can be used to link to this page
Your browser does not support the video tag.
Home
My WebLink
About
02.A- Water
DOC ID: 3861 CITY OF SAN BERNARDINO — REQUEST FOR COUNCIL ACTION Information/Report From: Stacey R. Aldstadt M/CC Meeting Date: 05/27/2015 Prepared by: Georgeann "Gigi" Hanna, Dept: Water Ward(s): All Subject: Water Department Sewer Treatment Study Current Business Registration Certificate: Not Applicable Financial Impact: Account Budgeted Amount: <<Insert Amount>> Account No. <<insert Account No.>> Account Description: <<Insert Account Description>> Balance as of: <<Insert Date>> Balance after approval of this item: <<Insert Amount>> Motion: Approve the Sewer Treatment rate study and forward the item to the Mayor and Common Council to set a date for a public hearing. Subject: On March 17, 2015, the Board of Water Commissioners (BOWC) conducted a wastewater rate workshop to review the Wastewater Treatment Rate Study Model (model) performed by FG Solutions, a nationally recognized engineering and rate consulting firm. This study analyzed cost of service, developed revenue requirements, and designed new rates to meet the financial requirements of the wastewater treatment facilities operated by the Water Department. The BO`dVC authorized submission of the model to Mayor and Common Council for adoption of a three-step rate adjustment, with an increase of 8.5% effective in 2015 and July 1, 2016 and an increase of 3.25% effective July 1, 2017. Background: The wastewater treatment facilities are owned and operated by the Water Department. Wastewater fees and charges were last adjusted January 1, 2012 through a 2011 Wastewater Rate Study conducted by R. W. Beck. In June 2013, the Department retained SAIC Energy. Environment & Infrastructure, LLC, which then became Leidos, a nationally recognized utility engineering and rate consulting firm, to, among other tasks, update revenue requirements for the wastewater treatment operations. In 2014, the Board approved an additional contract with FG Solutions, a firm organized by the former principal of Leidos to complete an update of the rate study. That work has been completed, and the study is attached for your review. Financial Impact: FG Solutions' model (attached) summarizes projected revenue requirements for Fiscal Years 2016 through 2021, documents fiscal policy issues that affect revenue Updated: 5/21/2015 by Georgeann "3igi" Hanna 3861 requirements, and provides detailed supporting calculations. The model identifies three financial targets utilized by financially prudent utilities: 1. Maintain debt service coverage in excess of 1.75x; 2. Maintain the Operating, Rate Stabilization and Emergency Reserves throughout the study period; and 3. Fund pay-as-you-go capital projects throughout the study period. FG Solutions reviewed historical operating expenses, existing assets, existing debt service, projected expenditures, potential financing strategies, required capital improvements, local economic factors, and system flow and loading information. Revenue requirements are established utilizing an iterative process that reviews various projected impacts of proposed rates. FG Solutions then functionalized, classified and allocated costs among various customer classes based upon usage characteristics of each class. The model analyzed the results over a six-year period and arrived at rates that meet the needs of the utility at the lowest possible cost to the consumer. The attached model will assist the Department in successfully achieving the three financial targets listed above. The results of the analysis include: 1. A recommendation to increase wastewater treatment rates approximately 8.5% each year for the next two years and 3.25% in 2017. This meets the Department's debt service coverage and funds required for capital projects while maintaining an appropriate level of cash. The proposed adjustment will result in monthly increases of $1.57, $1.71 and $ .71 for residential customers in years 2015-2017. 2. A discussion regarding the Department's wastewater treatment capital improvement program (CIP). Approximately 68 percent of the CIP is expected to be debt-funded. The impacts of future debt issuances have been accounted for in the rate study. 3. A discussion of the Department's reserve balances. By the end of FY 2020/21, the Department is projected to have a total of approximately $21 million in reserve balances. The Operating Reserves, Revenue Stabilization Reserves, Emergency Reserve, and Capital Replacement Reserve are projected to be at their minimum amounts, and the Unrestricted Fund balance is greater than $0. Attachments: Department Presentation LG Solutions Sewer Treatment Rate Study Model - Fiscal Years 2016 - 2021 Supporting Documents: Updated: 5/21/2015 by Georgeann "Gigi" Hanna -- 3861 051115 Draft Sewer Treatment Report (PDF) 051115 Sewer Treatment Appendix A (PDF) Sewer Collection and Sewer Treatment City Council Workshop (PPTX) Updated: 5;21/2015 by Georgeann "Gigi" Hanna — - Draft Report a 2 c m Sewer Treatment Rate Study 3 m City of San Bernardino Municipal Water Department $NN Bp o r r <D Z M • 0 CL �rER �v 4 E 3 m CO 0 LO 0 c (D E r Q May 2015 SOLUTIONS Packet Pg. 8 co 2 c (D E R a� L L 4) 3 a� cn r C 0 E R CL m D L 2R 7 r co yv L O CL 4) r c m E m L H L m 3 aD R L 0 LO T V- T- LO O C d E t V R Q Packet Pi 9 Draft Report 2 E Sewer Treatment Rate Study M 3 m .., City of San Bernardino Municipal water Department 4) t W CL SNN BED o -� 3 tir • O a k�9 fi�R DE4 E w SD d 3 m 0 W) 0 r C 4) E s v M May 2015 a SOLUTIONS Packet Pg. 10 This report has been prepared for the use of the client for the specific purposes identified in the report. The conclusions, observations and recommendations contained herein attributed to FG Solutions, LLC constitute the opinions of FG Solutions, LLC. To the extent that statements, a information and opinions provided by the client or others have been used in the preparation of this report, FG Solutions, LLC has relied upon the same to be accurate, and for which no CYO assurances are intended and no representations or warranties are made. FG Solutions, LLC c makes no certification and gives no assurances except as explicitly set forth in this report. °' E O 2015 FG Solutions, LLC All rights reserved. H L W 3 as c m E i` s ca a m L R r CO M t.' O E Q Of f+ c f d E L L Q� CO L U) T V- V.- LO 0 C E M V a Packet Pg. 11 Sewer Treatment Rate Study City of San Bernardino Municipal Water Department Table of Contents a Table of Contents CO List of Tables d E SEWER TREATMENT RATE STUDY................................... Background............................................................................................................1 ` Methodology and Key Assumptions.....................................................................2 3 RevenueProjections..............................................................................................3 N Expense Projections...............................................................................................6 c Reserves...............................................................................................................10 E Financial Projection......................... ....................................11 Proposed Sewer Treatment Rate Schedule..........................................................13 d Example Monthly Sewer Bill Comparison..........................................................14 L On g oina a Considerations................................................................................... 16 cc �o 00 Appendix A 0 a m c m E ea d L L 3 m CO �a L LO r r r LO b+ C d E V Q -sOLUTIONS Packet Pg. 12 Table of Contents List of Tables Table I Financial Policies..............................................................................................3 Table 2 Current Sewer Treatment Rate Schedule..........................................................5 Table 3 Revenues under Current Rates..........................................................................6 Table 4 O&M Expenses—Basis for Projection.............................................................7 Table 5 Projected Operation and Maintenance Expenses................................ .............8 31 Table 6 Projected Capital Improvements.......................................................................9 Table 7 Projected Debt Service Payments...................................................................10 Table 8 Revenue Requirement Projections..................................................................12 E Table 9 Financial Performance Indicators...................................................................12 Table 10 Proposed Sewer Treatment Rate Schedule...................................................14 Table I I Monthly Single-Family Residential Bill Comparison..................................15 2 E 2 0 CL E 4) U) LO Q 4) E iV FG Solutions,LLC 051115 Draft Sewer Treatment Report Packet Pg. 13 I II i SEWER TREATMENT RATE STUDY Background The City of San Bernardino provides sewer collection and treatment services to its customers through two separate City departments. The City of San Bernardino N Municipal Water Department ("Department") provides sewer treatment services, and the City of San Bernardino Public Services Department provides sewer collection services. The Department provides sewer treatment services to approximately 3 64,000 connections in the City of San Bernardino, the City of Loma Linda, the East in Valley Water District, and portions of unincorporated San Bernardino County. The Department is a semi-autonomous agency governed by the five-member Board of E Water Commissioners (`BOWC"). The Department's sewer treatment services are cc provided to retail customers in San Bernardino, as well as retail customers of its two 0 Partners, the East Valley Water District ("EVWD") and the City of Loma Linda (collectively referred to as"Partners" in this report). A periodic analysis of the revenues and expenditures for the sewer treatment system is conducted to ensure sufficient revenues are collected to effectively provide for the CO short-term and long-term wastewater treatment needs of the community. The analysis includes a six-year projection of operating and capital program costs in order to 0 provide adequate funding for upcoming expenses and to avoid significant unanticipated increases in rates. To achieve planned service goals, incremental rate increases provide a method for ensuring rate stability. E Since the most recent Sewer Treatment Rate Study was completed in approximately L 2010, there have been ongoing changes in the Department's sewer systems, and the Department seeks to update its sewer treatment rate schedule. In 2013, the 3 Department hired Leidos Engineering, LLC ("Leidos") to update the charges. In in 2014, the Leidos project manager founded FG Solutions, LLC ("FG Solutions"), and subsequently,the District hired FG Solutions to complete the project. o The results of this Study are summarized in this report,the purposes of which are: ■ To summarize the projected sewer treatment revenue requirements for the six-year ° study period for fiscal years("FY")2015/16 through 2020/21 t. ■ To present the adopted schedule of sewer treatment rates effective through the end of FY 2017/18 that the BOWC and the City Council may choose to consider in the first half of 2015. Q The Department's fiscal year begins on July 1. -y SOLUTIONS Packet Pg. 14 i SEWER TREATMENT RATE STUDY ■ To outline potentially changing conditions with financial implications and, recommendations for ongoing monitoring of these items. Methodology and Key Assumptions To provide for the continued operation of a utility on a sound financial basis, revenues must be sufficient to meet the cash requirements for operation and maintenance (O&M) expense, debt service requirements, debt service coverage requirements, N reserves, and cash funded capital expenditures not financed with debt. The sum of r these cost components for a given year is referred to as a utility's revenue requirement. Historical and budgeted financial and operational data were provided by the L Department and used by FG Solutions to develop the projected revenue requirement for the six-year study period. The revenue requirement analysis was an iterative ; process and draft versions were revised based on comments and input provided by N Department staff. Next, the revenue requirement was compared with the revenues c generated by the existing rates to generate additional revenues needed from rate E increases. In general, rate increases were minimized while meeting reserve and debt a service coverage requirements. The reserve requirements, described below, are met in o the later years of the six-year projection period as the proposed rates were developed to generate these reserve levels over time. Key assumptions used in this Study are listed below. Additional assumptions are provided in the printout of the rate calculations that comprise Appendix A. o Expenses c CL • Projected O&M expenditures are primarily based on the Department's FY 14/15 budget, and some specific adjustments to the Department's budget were made based on other known or anticipated conditions. Additional detail for O&M E expense projections is included in later sections of this report. L • Inflation projected at 2.1 percent per year, unless otherwise noted. 3 ■ Projected capital expenditures through FY 20/21 were obtained from the N Department's 5-Year Sewer Fund Capital Improvement Program ("CIP"). L ■ Debt issuances are sized and timed to fund the projected capital expenditures, minimize rate increases, meet reserve requirements, and meet Debt Service Coverage Ratio ("DSCR")targets. Additional detail is found below. c Revenue Assumptions E • There is a 45 day lag between the date a rate increase is applicable to San Bernardino customers and the date a rate increase is applicable to the Q Department's Partners. • Projected sewer rate revenues are based on FY 13/14 actual revenues. • A 1 percent annual customer growth and revenue growth is projected. 2 FG Solutions,LLC 051115 Draft Sewer Treatment Report Packet Pg.15 2.Aa SEWER TREATMENT RATE STUDY ■ Non-rate revenues are based on the Department's FY 14/15 budget, which are of similar magnitude as historical values. Policy Assumptions The proposed sewer treatment rates are influenced by the financial policy targets shown in Table 1. The Reserve Policy has been adopted by the BOWC. The other V policies in Table 1 have not been formally adopted by the Department, but were used U) in the development of the adopted rate structure. E Table 1 d Financial Policies W Policy Issue Importance of Financial Policy Financial Policy Target rn Debt Service Coverage A minimum DSCR is a requirement of lenders. A Department's senior debt Ratio(DSCR) Exceeding the minimum DSCR provides ordinances require a debt service additional flexibility for the Department to coverage ratio greater than 1.10, E accommodate changing conditions such as but a 1.75 minimum for ratemaking a unanticipated expenses and may help obtain purposes is used to ensure m more favorable future debt terms. sufficient revenue is collected to cover debt service expenditures. Amount of Future Debt A pay-as-you-go capital funding strategy(without Debt is issued to fund certain capital Issued issuing debt)requires higher up-front rate improvements,as described below. increases but decreases future costs. CO M Reserve Balance Reserves provide more flexibility for the Described in further detail below. Department to react to changing conditions with a financial implications(such as changes in capital costs,development activity,or the economy). +, c a� E Revenue Projections SD Revenue projections are a critical part of the revenue requirement analysis. The three 3 aspects of revenue projections described in the sections below are non-rate revenues, N rate revenues under the current rates effective January 1, 2012, and rate revenues from proposed rate increases. o u� Non-Rate Revenues LO The key sources of sewer revenues other than sewer treatment rates are the following: ° c • Sewer Capacity Fees. These are one-time fees payable at the time of development that represent a proportionate share of the cost of sewer treatment capacity. Capacity Fee revenues dropped substantially during the downturn but Q have rebounded to some extent in recent years. The FY 14/15 budgeted value of $700,000 is used to project Sewer Capacity Fee revenue in each year of this Study. • SARI Discharge and Permits. The Santa Ana Regional Interceptor ("SARI") station is operated by the Department under an agreement with the San Bernardino Valley Municipal Water District ("SBVMWD") for the discharge of brine Draft FG Solutions Packet Pg. 16 SEWER TREATMENT RATE STUDY wastewater. In FY 14/15, the Department is projecting $90,000 in SARI discharge and permit reimbursements. • Septic Receiving Fees. The Department receives approximately $100,000 per year from septic customers that deliver septage to the Department's Margaret H. Chandler Water Reclamation Plant("WRP"). • Industrial Waste Income. The Department receives approximately $90,000 per T year in industrial waste income. � • Interest Income. The Department invests its capital and operating reserves and earns interest income on these reserves. In FY 14/15, interest income is projected £ to be $510,000. For the remainder of the Study period, annual interest income is estimated to be 2.0 percent of Sewer Fund reserves. L • Capital Grants. The Department aggressively pursues grant funding for capital projects. Grant funding is competitive and is difficult to obtain. The Department V) anticipates using $588,000 in grant funding associated with its Clean Water Factory to offset capital costs. For the purposes of this Study, no additional grant E funding is projected other than what has already been received by the Department. a Additional detail of projected non-rate revenues is included in Appendix A. o L d Rate Revenues under Current Rates Table 2 shows the current sewer treatment rate schedule, which became effective on CO January 1, 2012. M Single-family residential customers pay a flat monthly service charge of$18.50. Two- V 0 and three-unit multi-family customers pay a flat monthly service charge of$18.50 per 4) unit. W c The service charge for all other customers is $2.40 per month. In addition, all other E non-industrial customers pay a usage charge that depends on the amount of metered d water consumption. This usage charge depends on the type of customer. L Rates for the City's industrial customers are based on the amount of flow, biochemical oxygen demand ("BOD") and total suspended solids ("TSS") discharged. rn L 0 LO r r r id C C) E t V V Q 4 FG Solutions,LLC 051115 Draft Sewer Treatment Report Packet Pg. 17 2A.a SEWER TREATMENT RATE STUDY Table 2 Current Sewer Treatment Rate Schedule Current Customer Class Rates Units Monthly Charge Residential $18.50 $/month Multi-Family(2 Units) $37.00 $/month Multi-Family 2 Units) $55.50 $/month Multi-Family(4 or more units),Non-Residential $2.40 $/month N Industrial $1.00 $/month c Usage Charge E Multi-Family(4+Units), Mobile Home Parks $1.25 $/hcf M Retail,Commercial,Light industrial $2.10 $/hcf t m` Auto Repair,Car Wash $1.30 $/hcf a, Offices,Motels(without Restaurants) $1.50 $/hcf Restaurants,Hotels $2.70 $/hcf Laundromats $1.50 $/hcf m Hospitals,Convalescent Homes $1.35 $/hcf E V_ Schools,Churches, Nursery Schools $1.10 $/hcf M CL Industrial m 0 Discharge Flow $900 $/mg Biochemical Oxygen Demand Charge 360 $/1,000 Ibs a Suspended Solids Charge 640 $/1,000 Ibs Note: hcf means hundred cubic feet. mg means million gallons. coo 0 Table 3 summarizes actual rate revenues under the current rate schedule for FY 2013/14. Rate revenues are shown for each Partner, and separately broken out for single-family residential (including duplexes and triplexes) customers. Approximately 64 percent of rate revenue is from customers with retail service from San Bernardino, Approximately 27 percent is from East Valley Water District customers, and the remaining 9 percent are customers of the City of Loma Linda. d 3 m R 0 LO r- Ln 0 c m E r ca Q Draft FG Solutions Packet Pg. 18 SEWER TREATMENT RATE STUDY Table 3 Revenues under Current Rates FY 13114 Line Customer Class Actual Percentage 1 San Bernardino 2 Residential $8,111,634 32% 3 Non-Residential 8,033,072 32% 4 Subtotal $16,144,705 64% 5 y 6 East Valley Water District c m 7 Residential $4,149,836 16% E 8 Non-Residential 2,725,075 11% 9 Subtotal $6,874,911 27% L 10 L N 11 Loma Linda 12 Residential $991,387 4% N 13 Non-Residential 1,330,102 5% a=i 14 Subtotal $2,321,489 9% E 15 ea CL 16 Total $25,341,105 100% W O Notes: d (1) Based on rates effective January 1,2012. a Excluded from the scope of this Study is the %2/month Trunk Line fee paid by East Valley Water District customers. co M Rate Revenues from Proposed Rate Increases f CL Rate revenues resulting from proposed rate increases are shown later in this report. at Expense Projections L 0&M Expenses z, 3 Operation & maintenance ("O&M") expenses for past years (FYs 10/11, 11/12, co 12/13), projected actual expenses from FY 13/14, and the FY 14/15 budget were obtained from the Department. These records were used in identifying any significant o changes in costs over the last few years, which was considered when projecting O&M expenses. Lo 0 In FY 12/13 and FY 13/14, the Department made accounting changes which affect how certain expenses are shown, which limit the usefulness of using expenses before E FY 13/14. Included are: • Creation of the Rapid Infiltration and Exchange ("RIX") Fund. The RIX Q facility is governed by a Joint Powers Agreement between the Cities of San Bernardino and Colton. San Bernardino is responsible for 80 percent of RIX costs and Colton is responsible for the remaining 20 percent. In previous years, all costs associated with the RIX facility were included in sewer treatment financial projections. Colton's 20 percent share of the costs were 6 FG Solutions,LLC 051 115 Draft Sewer Treatment Report Packet Pg. 19 ZA.a SEWER TREATMENT RATE STUDY recorded as a revenue to partially offset costs. The creation of the RIX Fund changes how RIX costs are shown in the Department's Sewer Fund. Now, the Sewer Fund only shows San Bernardino's 80 percent share of the costs, with no offsetting revenue. The Sewer Treatment Fund will now show less expenses (because Colton's 20 percent share is not included) and less revenues (because Colton's payments for these costs are not included). + Recording of certain administrative costs in the Administrative Division instead of in Section 4010 of the Water Reclamation Division. This change CO does not represent a change in expenses — rather, it is a change in where the c expenses are recorded. As a result, this accounting change increases E Administration Division expenses, decreases Water Reclamation Division d expenses and does not change total expenses. L d 3 CD co Table 4 shows the basis for projection of O&M expenses for FY 14/15 and the remainder of the Study period. Additional detail is included Table 5 and in the £ Appendix. a Table 4 0 0&M Expenses- Basis for Projection 3 Type of Expense FY 14/15 Succeeding Years Notes o All Expenses Not Described Below FY 14/15 Budget Previous Year+ Inflation CO Personnel Costs FY 14/15 Budget Less Vacancies Previous Year+ Infl; Fill Vacancies 1 PERS FY 14/15 Budget Per Actuarial Projections 2 °c. Biosolids: Contracted Services and Polymer FY 14/15 Budget Previous Year+ Infl; Loadina Growth 3 W Certain Administrative Expenses FY 14/15 Budget Previous Year+Infl; Less Non-Recurring$ 4 a Notes: 1. There are a number of budgeted,but unfilled,positions within the Water Reclamation Division. The cost of vacant positions is excluded from financial projections,and it is assumed that the vacancies will be filled during the remainder of FY 14/15 and FY 15/16. a� 2. PERS projections were obtained from CaIPERS actuarial data provided by the Department. Generally,PERS costs are m increasing faster than inflation. N 3. In addition to inflation,these expenses are projected to increase with increases in solids loadings at a rate of 1%per year. 4. Certain expenses in the FY 14/15 budget are non-recurring and are not included in projections after FY 14/15. p` Table 5 summarizes the projected O&M expenses for the six-year study period for o each section. A detailed list of O&M expenses is included in Appendix A. The c majority of O&M expenses pay for services provided the Department's Administrative E Services and Water Reclamation Divisions. The Sewer Fund also pays for a portion of the Engineering Section which is housed in the Department's Water Division. a Draft FG Solutions Packet Pg. i SEWER TREATMENT RATE STUDY Table 5 Projected Operation and Maintenance Expenses Section Projected Line Division and Section Number FY 14115 FY 15116 FY 16117 FY 17118 FY 18119 FY 19120 FY 20121 1 Administrative Division 2 Board of Water Commissioners 1010 $18,275 $18,660 $19,050 $19,450 $19,850 $20,260 $20,680 3 Administration 1050 175,860 182,470 189,420 196,030 202,690 209,550 213,950 4 Administrative Services 1055 163,305 169,580 176,150 182,400 188,690 195,180 199,280 5 Environmental and Regulatory Compliance 1060 429,200 443,610 362,880 375,350 387,920 400,860 409,280 6 Human Resources 1070 104,208 107,950 111,910 115,700 119,510 123,440 126,030 7 Finance and Accounting 2010 408;690 423,980 439,990 455,250 470,630 486,470 496,690 (n 8 Information Technology 2030 312.708 324,190 336,160 347,600 359,140 371,000 378,790 c 9 Purchasing 2040 270,174 236,270 245,150 253,610 262,150 270,940 276,620 4) 10 Fleet 2045 174,064 145,870 184,330 190,780 197,290 203,990 208,270 11 Customer Relations 2050 72,270 74,980 77,820 80,520 83,250 86,050 87,850 d 12 Customer Service(1) 2060 378,147 391,590 405,640 419,080 432,650 446,620 455,980 H 13 Billing and Collections(1) 2070 126,794 131,380 136,210 140,810 145,460 150,230 153,390 14 Cashiering(1) 2080 204,792 212,280 220,160 227,680 235,260 243,060 248,170 15 Subtotal,Administrative Division $2,838,487 $2,862,810 $2,904,870 $3,004,260 $3,104,490 $3,207,650 $3,274,980 N 16 N r 17 Water Division � 18 Engineering 3060 $581,262 $602,990 $625,760 $647,450 $669,320 $691,820 $706,340 19 Subtotal,Water Division $581,262 $602,990 $625,760 $647,450 $669,320 $691,820 $706,340 � 20 M 21 'Water Reclamation Division a� 22 Water Reclamation Administration 4010 $738,315 $763,960 $790,760 $816,490 $842,440 $869,120 $887,360 23 Water Reclamation Plant Operations 4020 5,939,990 6,098,390 6,262,090 6,423,760 6,587,860 6,756,010 6,897,890 24 Bio-Solid Processing 4021 2,462 500 2,529,530 2,607,310 2,687,480 2,770,130 2,855,340 2,943,180 R 25 RIX Facility 4025 3,754,963 3,833,820 3,914,330 3,996,530 4,080,460 4,166,150 4,253,640 26 Water Reclamation Plant Maintenance 4040 2,680,385 2,759,440 2,841,530 2,921,620 3,002,750 3,085,980 3,150,780 27 Electrical,Instrumentation,and SCADA 4042 966,340 997,160 1,029,250 1,060,310 1,091,720 1,123,970 1,147,570 28 Environmental Control 4050 659,500 682,150 705,790 728,500 751,420 774,990 791,270 M 29 General Administrative Expense 4090 1,311,400 1,399,760 1,095,870 1,103,150 1,110,550 1,118,120 1,125,840 30 Subtotal,Water Reclamation Division $18,513,393 $19,064,210 $19,246,930 $19,737,840 $20,237,330 $20,749,680 $21,197,530 31 C C. 32 Adjustment for Vacancies ($1,110,000) ($370,000) $0 $0 $0 $0 $0 4) 33 r 34 Total,Sewer Fund 0&M Expenses $20,823,142 $22,160,010 $22,777,560 $23,389,550 $24,011,140 $24,649,150 $25,178,850 c d Notes: E R (1)These costs are recovered solely from San Bernardino customers and are not charged to EVWD or Loma Linda customers. F- Capital Improvements and Capital Improvement Funding 3 d The Department provided its Capital Improvement Plan, covering the years through FY 20/21. This CIP contains 90 projects incorporated into this Study, and in Table 6, `4 the projects are grouped into one of five categories shown in Lines 1 through 5 of the table. 0 c m E s �o Q 8 FG Solutions,LLC 051115 Draft Sewer Treatment Report Pm*et Pg.21 2.A.a SEWER TREATMENT RATE STUDY Table 6 Projected Capital Improvements Line Capital Project Type FY 14115 FY 15/16 FY 16117 FY 17118 FY 18/19 FY 19/20 FY 20121 Notes 1 Replaoement/Rehabilitation of System Assets $10,981,700 $1,760,000 $3,620,000 $3,884,500 $1,280,875 $601,500 $863,750 1 2 New System Assets 6,102,296 360,000 8,875,000 12,082,000 4,585,000 570,000 2,910,000 1 3 Clean Water Factory Phases 1-3 2,603,700 0 2,000,000 18,250,000 0 0 0 1.4 4 RIX-New System Assets(SBMWD Portion Only) 500,600 24,000 24,000 0 0 0 24,000 1 5 RIX-Facilities Rehabilitation(SBMWD Portion Only) 651,800 300,800 308,000 391,200 397,600 250,400 0 1 6 Plus New Engineering Staff 0 300,000 300,000 300,000 300,000 300,000 300,000 2 5z 7 Plus Overhead Applied Property,Plant,and Equipment 425,000 433,930 443,040 452,340 461,840 471,540 481,440 3 3 8 Plus Capitalized Labor 1,495,200 1,526,600 1,558,660 1,591,390 1,624,810 1,658,930 1,693,770 3 N 9 Total $22,760,296 $4,705,330 $17,128,700 $36,951,430 8,650,125 3,852,370 6,272,960 c Notes: m (1) FY 14/15 through FY 20/21 from the Department's CIP updated in February 2015. E (2) Per Department discussion 10/17/13,two FTE will be needed in order to complete CIP.For the purposes of this Rate Study,expenses for these staff start in FY 15/16. (3) These costs are capital costs that are paid from the Depar'tment's operating budget. They are excluded from 00 expenses shown in Table 5 and included as capital expenses in this table. FY 14/15 amounts are from the Department's FY 14/15 budget,with inflationary 3 adjustments for subsequent years. aD (4) Clean Water Factory Phase 4(full scale design and construction)is not included in this Study. y c m E Replacement/Rehabilitation of System Assets and New System Assets both refer to a improvements at the WRP. Similarly, improvements at the RIX facility are o categorized as either New System Assets or Facilities Rehabilitation. RIX costs are `m limited to the Department's 80 percent share of the total RIX project cost. The remaining 20 percent is covered by the City of Colton and is not included in this Study. Projects associated with Phases 1 — 3 of the Department's Clear. Water Factory are also shown. These phases include preliminary engineering, pilot testing of the a advanced purification pilot plant, and design/construction of the related tertiary treatment facilities. Phase 4 (design and construction of the full-scale facility) is not yet included in rate projections. E The projected capital improvements represent a larger annual expenditure than what ;v the Department historically has executed. Department staff anticipate that two d additional engineering staff are needed to deliver the projects that constitute the CIP. Finally, an annual capital expenditure for equipment and capitalized labor is included. co The total anticipated capital expenditure over the six-year Study period is o approximately $100 million (including approximately $22 million in the current fiscal year which ends prior to the proposed rate increases taking effect). The CIP LO includes Phases l through 3 of the Department's proposed Clean Water Factory, but does not include Phase 4, full scale design and construction. c as The Department anticipates issuing debt to fund much of this CIP. In general, debt issuances are sized and timed to fund the CIP, minimize rate increases, meet reserve requirements (discussed below) and meet DSCR criteria. Q The anticipated debt proceeds would fund approximately 68 percent of the estimated capital project cost through FY 20/21. Debt service payments would be paid through rate revenue and other non-rate revenues. Draft FG Solutions Packet Pg.22 SEWER TREATMENT RATE STUDY As described above under financial policies,the sizing and timing of debt issuances is done to minimize rate impacts, meet coverage requirements, and meet reserve requirements. Existing and Projected Debt Service Table 7 shows existing and projected annual debt service payments. Debt proceeds are shown in line 1, and annual debt service payments are shown in lines 2 through 8. .� Line 3 through 5, assuming existing Certificates of Participation are refinanced. Lines 6 and 7 shows anticipated future debt. More detailed information on existing and projected debt service is included in E Appendix A. a Table 7 Projected Debt Service Payments in Projected c Line Existing and Projected Debt Service FY 14/15 FY 15116 FY 16117 FY 17118 FY 18119 FY 19120 FY 20121 Notes O 1 Debt Proceeds $0 $20,000,000 $10,000,000 $30,000,000 $8,000,000 $0 $0 1 to 2 Debt Service CL O 3 Existing Certificates of Participation $3,439,412 $0 $0 $0 $0 $0 $0 0 4 Refinanced Certificates of Participation 0 760,000 760,000 760,000 760,000 760,000 760,000 2 d 5 Existing SRF Loan(Suboridnate Lien) 1,758,900 1,757,582 0 0 0 0 0 6 New FY 15/16 Debt 0 1,340,000 1,340,000 1,340,000 1,340,000 1,340,000 1,340,000 3 7 New Bank Financing after FY 15/16 0 0 796,000 3,184,000 3,821,000 3,821,000 3,821,000 3 8 Total Debt Service $5,198,312 $3,857,582 $2,896,000 $5,284,000 $5,921,000 $5,921,000 $5,921,000 Notes: M (1)Debt issuances for this Study were sized to pay for the capital program,meet reserve and coverage requirements,and minimize rate increases. (2)Based on a 10-year refinance in FY 15/16. Refinancing terms are calculated by FG Solutions from information in a 2014 presentation to the City by De La Rosa&Co.; O 2.9%interest rate over 10 years,with a 10%capitalized bond reserve. M (3)FY 15/16 information is calculated by FG Solutions,LLC based on information in a 2014 presentation of the City by De La Rosa&Co.; Refer to Appendix I=N for more detail. After FY 15/16,projected debt terms are 6%over 30 years,with capitalized bond reserve of 8.75%of proceeds. d E Reserves The Department has created several water system reserves The following is a 3 description of these reserves and their minimum balances: N • Operating Reserve. The minimum Operating Reserve balance is 45 days of O&M expenses. This minimum balance is maintained throughout the Study LID period. LO • Revenue Stabilization Reserve. The minimum Revenue Stabilization Reserve balance is 10 percent of annual sewer sales revenue. This reserve is fully funded by the end of FY 15/16. E s • Emergency Reserve. The minimum Emergency Reserve balance is three V percent of the total plant in service. This reserve is fully funded by the end of Q FY 15/16. • Capital Replacement Reserve. The minimum Capital Replacement Reserve balance is 20 percent of the cash-funded CIP. This reserve is fully funded by the end of FY 15/16. 10 FG Solutions,LLC 051115 Draft Sewer Treatment Report Packet Pg. 23 2Aa SEWER TREATMENT RATE STUDY • Unrestricted Fund Balance. The balance of Department reserves, for the purposes of this Rate Study, as Unrestricted Fund Balance. There is no minimum balance established for Unrestricted Funds, but in this Study, the intent is to keep this balance above $0. By the end of FY 20/21, the Department is projected to have a total of approximately $21 million in sewer reserve balances, as shown in further detail in Table 8 below. 3 Financial Projection N To provide for the continued operation of a utility on a sound financial basis, revenues E must be sufficient to meet the cash requirements for operation and maintenance L (O&M) expense, debt service and debt service coverage requirements, reserves, and cash funded capital expenditures not financed with debt. 3 Table 8 shows the Department's revenue requirement projections through FY 20/21. Lines 1 through 18 show sources of funds, including beginning year reserves, water rate revenues, other revenues, and debt proceeds. t: �a Lines 20 through 30 show the projected uses of funds. These uses of funds include o O&M expenses shown in Table 5 of this report, existing and proposed debt service shown in Table 7 of this report, and capital expenditures. Line 32 shows the projected end year reserve balance. cc 0 a m C 4) E ca m L H L 3 as rn �o L 0 u� LO 0 C m E s ca Q Draft FG Solutions, LPaclwt Pg.24 2A.a SEWER TREATMENT RATE STUDY Table 8 Revenue Requirement Projections Projected Line FY 14/15 FY 15/16 FY 16/17 FY 17/18 FY 18/19 FY 19/20 FY 20/21 1 SOURCES OF FUNDS 2 Beginning Fund Balance(Restricted and Unrestricted) $23,728,091 $2,614,920 $20,901370 $20,157,060 $17,952,840 $22,165,670 $22,956,740 3 Sewer Rate Revenue with Current Rates 25,594,516 25,850,460 26,108,960 26,370,050 26,633,750 26,900,090 27,169,090 4 Revenues under Proposed Rate Increases 5 %of Sales 6 Effective Date Sales Revenue 'a 3 7 FY 15/16 8.5% 2,097,610 2,219,260 2,241,460 2,263,670 2,286,510 2,309,370 8 FY 16/17 8.5% 2,298,660 2,431,970 2,456,300 2,480,860 2,505,670 N 9 FY 17/18 3.25% 963,140 1,019,000 1,029,180 1,039,490 N 10 FY 18/19 3.25% 1,052,110 1,062,640 1,073,260 E 11 FY 19/20 0.0% 0 0 R 12 FY 20/21 0.0% 0 L 13 Subtotal,Pate Revenue From Rate Increases $0 $2,097,610 $4,517,920 $5,636,570 $6,791,280 $6,859,190 $6,927,790 14 15 Service Charges and Other Revenue $288,000 $288,000 $288,000 $288,000 $288,000 $288,000 $288,000 16 Interest Income and Non-Operating Revenues 1,786,060 775,300 1,141,070 1,126,140 1,082,060 1,166,310 1,182,130 N 17 Debt Proceeds 0 20,000,000 10,000,000 30,000,000 8,000,000 0 0 18 Total Sources of Funds $51,396,667 $51,626,290 $62,959.320 $83,577,825 60,747,930 $57,379,260 $58,523,750 d 19 E 20 USES OF FUNDS 21 0&M Expenditures $20,823,142 $22,160,010 $22,777,560 $23,389,550 $24,011,140 $24,649,150 $25,178,850 C- 22 tv 23 Total Debt Service $5,198,312 $3,857,582 $2,896,000 $5,284,000 $5,921,000 $5,921,000 $5,921,000 24 +; 25 Capital Expenditures 26 Debt Funded $0 $20,000,000 $10,000,000 $30,000,000 $8,000,000 $0 $0 27 Cash Fundad 22,760,296 (15,294,670) 7,128,700 6,951,430 650,125 3,852,370 6,272,950 1� 28 Total Capital Expenditures $22,760,296 $4,705,330 $17,128,700 $36,951,430 $8,650,125 $3,852,370 $6,272,960 0 00 29 M 30 Total Expenditures $48,781,750 $30,722,922 $42,802,260 $65,624,980 $38,582,265 $34,422,520 $37,372,810 31 32 Ending Fund Balance $2,614,917 $20,903,368 $20,157060 $17,952,840 $22,165,665 $22,956,740 $21,150,940 C Table 9 shows the various reserve balances and the projected Debt Service Coverage Ratio. A minimum coverage ratio criterion of 1.75 is used for rate setting purposes. E Table 9 shows that the Department exceeds this criterion throughout the Rate Study period. L Table 9 3 d Financial Performance Indicators Projected G Line FY 15/16 FY 16/17 FY 17/18 FY 18/19 FY 19/20 FY 20/21 0 1 EOY Reserve Balance 2 Operating Reserve Minimum $2,732,060 $2,808,190 $2,883,640 $2,960,280 $3,038,940 $3,104,240 r 3 Revenue Stabilization Reserve(10%of Sewer Sales) 2,823,610 3,091,490 3,229,460 3,371,300 3,404,730 3,438,490 0 0 4 Emergency Reserve(3%of Total Plant in Service) 7,211,330 7,725,190 8,833,730 9,093,230 9,208,800 9,396,990 5 Capital Replacement Reserve(20%of the Cash Funded 5-Yr CIP) 5,210,000 5,210,000 2,910,000 5,210,000 5,210,000 5,210,000 d 6 Unrestricted Fund Balance 2,926,368 1,322,190 96,010 1,530,855 2,094,270 1,220 87 Total $20,903,368 $20,157,060 $17,952,840 $22,165,665 $22,956,740 $21,150,940 v 9 Debt Service Coverage Ratio 10 Gross Revenue $27,668,576 $29,011,370 $32,055,950 $33,420,760 $34,795,090 $35,213,590 Q 11 Less 0&M Expenses (20,823,142) (22,160,010) (22,777,560) (23,389,550) (24,011,140) (24,649,150) 12 Subtotal: Revenue Available for Debt Service 6,845,434 6,851,360 9,278,390 10,031,210 10,783,950 10,564,440 13 14 First Tier Debt Service 3,439,412 2,100,000 2,896,000 5,284,000 5,921,000 5,921,000 15 16 Debt Service Coverage Ratio 1.99 3.26 3.20 1.90 1.82 1.78 17 DSCR Criterion: Minimum 1.75 1.75 1.75 1.75 1.75 1.75 12 FG Solutions,LLC 051115 Draft Sewer Treatment Report Packet Pg.25 2.A.a SEWER TREATMENT RATE STUDY Proposed Sewer Treatment Rate Schedule The proposed sewer treatment rate schedule shown in Table 10 contains three rate increases that would become effective later in 2015, and July 1 of 2016 and 2017. The rate increase shown in Table 10 is proposed to be applied to the various components of the rate structure as follows: 31 V • Usage Charge are increased by the systemwide average rate revenue increases r shown in Table 8: 8.5 percent increase effective later in 2015; 8.5 percent 2 increase effective July 1, 2016; 3.25 percent increase effective July 1, 2017. E • Certain expenses are allocated only to San Bernardino and are referred to in this Rate Study as "Department-Only Expenses". These are expenses associated with the Department's Customer Service, Billing, and Cashiering 3 services (Department Sections 2060, 2070, and 2080, respectively). These y services are most appropriately allocated only to San Bernardino because the Department only provides them for San Bernardino customers. The E Department does not provide them for EVWD and Loma Linda customers. CL • Recognition of recovery of Department-Only Expenses only from San 0 Bernardino customers is done by an addition to the Monthly Charge in addition to the systemwide average percentage increase. • Conversely, the Monthly Charge applicable to EVWD and Loma Linda will be lower than that applicable to San Bernardino. Not included in Table 10 is the remaining projected increase to the monthly minimum charge and commodity charge that would take effect(if adopted) in 2018. a d c as E a� L L 3 m to eo L LO Lo 0 c a� E s Q Draft FG Solutions, Packet Pg.26 SEWER TREATMENT RATE STUDY Table 10 Proposed Sewer Treatment Rate Schedule Current Proposed Rates(Draft) Line Customer Class Rates Later in 2015 7/1/2016 7/1/2017 1 System-Wide Percent Rate Increase n/a 8.5% 8.5% 3.25% 2 3 Monthly Charge(San Bernardino) 4 Residential $18.50 $20.65 $22.38 $23.10 �+ 5 Multi-Family(2 Units) $37.00 $41.31 $44.76 $46.20 6 Multi-Family(3 Units) $55.50 $61.96 $67.14 $69.29 N 7 Multi-Family(4 or more units),Non-Residential $2.40 $3.18 $3.42 $3.52 8 Industrial $1.00 $1.67 $1.78 $1.83 E E 9 Monthly Charge(EVWD and Loma Linda) is 10 Residential $18.50 $19.18 $20.86 $21.55 m 11 Multi-Family(2 Units) $37.00 $38.37 $41.72 $43.10 12 Multi-Family(3 Units) $55.50 $57.55 $62.58 $64.64 ; 13 Multi-Family or more units),Non-Residential y( ) $2.40 $1.71 $1.90 $1.97 CO) 14 Industrial $1.00 $0.20 $0.26 $0.28 .1 15 Usage Charge(All Customers) 16 Multi-Family +Units),Mobile Home Parks E Y( ) $1.25 $1.36 $1.48 $1.53 17 Retail,Commercial,Light Industrial $2.10 $2.28 $2.47 $2.55 es CL 18 Auto Repair,Car Wash $1.30 $1.41 $1.53 $1.58 Q 19 Offices,Motels(without Restaurants) $1.50 $1.63 $1.77 $1.83 20 Restaurants,Hotels $2.70 $2.93 $3.18 $3.28 21 Laundromats $1.50 $1.63 $1.77 $1.83 3-1 22 Hospitals,Convalescent Homes $1.35 $1.46 $1.58 $1.63 23 Schools,Churches,Nursery Schools $1.10 $1.19 $1.29 $1.33 24 Industrial c� 25 Discharge Flow $900 $977 $1,060 $1,094 26 Biochemical Oxygen Demand Charge 360 391 424 438 27 Suspended Solids Charge 640 694 753 778 (D r C m Example Monthly Sewer Bill Comparison cc Table 11 compares example monthly residential sewer bills with those for other local utilities. The comparison includes both sewer treatment, provided by the ; Department, and sewer collection, currently provided by the City. The draft results of v� the concurrent Sewer Collection Rate Study are also included. L Where possible, Table 11 separately identifies rates for sewer collection and treatment, Lo as some but not all utilities have separate charges. This table shows that the Department's monthly sewer bill for this average residential ° customer is lower than most neighboring agencie. , even after the proposed three rate increases. The table shows currently available information about sewer rates that will E be in effect as of later in 2015 and where known, includes in the table notes information about future rate increases that have already been adopted. a 2 Note that the two utilities served by Inland Empire Utilities Agency(IEUA)appear to have lower sewer treatment rates than other utilities. However,Table 11 does not show that IEUA collects property tax revenues in addition to user charge revenues. IEUA's FY 14/15 Budget shows$62.8M of user charge revenues and$40.1 M of property tax revenues. 14 FG Solutions,LLC 051115 Draft Sewer Treatment Report Pm*et Pg.27 Z.A.a SEWER TREATMENT RATE STUDY Table 11 Monthly Single-Family Residential Bill Comparison Line Utility Treatment Collection Total 1 San Bernardino 2 Existing $18.50 $4.00 $22.50 3 Proposed Later in 2015 $20.65 $9.00 $29.65 4 Proposed 7/1/16 $22.38 $9.45 $31.83 3, 5 Proposed 7/1/17 $23.10 $9.92 $33.02 6 N 7 Other Jurisdictions,Rates Later in 2015(1) c 8 Rialto(4) N/A N/A $50.72 E 9 East Valley Water District(3) $19.18 $15.36 $34.54 m 10 Riverside(5) N/A N/A $33.62 11 Colton(2) N/A N/A $33.00 m 12 Loma Linda(3) $19.18 $10.97 $30.15 m 13 Redlands N/A N/A $23.24 rn r 14 Fontana(6) $14.39 $7.37 $21.76 m 15 Cucamonga Valley Water District(6) $14.39 $5.73 $20.12 E �a a Notes: O (1)Rates effective later in 2015,to the extent rate increases have already been adopted. "N/A"means that treatment and collection rates are not broken out separately. a (2)Colton's rate wil!increase to$34.33 as of 7/1/17. 3 (3)Includes the proposed Department sewer treatment rate increase effective later in 2015 EVWD and Loma Linda's sewer collection rate was calculated by FG Solutions,LLC by subtracting the Department's sewer treatment charge from the total charge. (4)Rialto's rate will increase to$60.19 in 2015. a (5)Riverside's rate will increase to$39.59 as of 7/1/17. o) (6)Sewer treatment provided by Inland Empire Utilities Agency(IEUA). IEUA has adopted treatment rate increases to$15.89 effective 10/1/15,with gradual increases to$20 m by FY 19/20. IEUA also collects property tax revenues not shown in this table. E a Its FY 14/15 budget shows$61.8M in user charge revenue and$40.2M in property-tax revenue. a� Comparisons with other jurisdictions can be useful, but they do not in themselves explain why utility rates are set at the levels they are. Each utility is unique and has its cc own set of circumstances that influence rate setting. In particular, the following are o not apparent from a monthly bill comparison: LO • Age of infrastructure and needed capital investments in order to maintain o service and comply with regulatory mandates. • The condition of the infrastructure and the extent to which a utility chooses to E invest in repairs and replacements to its infrastructure. ev • Whether a utility is currently deferring capital investment and whether large Q capital expenditures loom in the future. • Specifically to the comparison shown in Table 11, any additional future rate for other jurisdictions increases not already adopted and not shown in Table 11. Draft FG Solutions, Pg.28 SEWER TREATMENT RATE STUDY • Level of treatment, capacity of facilities, final disposition of the treated wastewater, point of discharge, etc. Ongoing Considerations The financial plan shown in Table 8 extends for a period of six years, and rate increases are proposed for the first three years. There are a number of factors that will change over the next few years that have financial implications. The extent to which i? these factors change will influence the Department's next review of sewer rates. a) The Department should continue to monitor its financial status on an ongoing basis, E and should continue to monitor the following: Iwo F- ■ Sewer flows and customer growth. The Rate Study assumes customer 1% annual growth through FY 20/21. Customer growth will increase the size of the customer base and will increase connection fee revenue and rate revenues compared with N projections. Commercial sewer rate revenues are related to water consumption; and changes in water consumption will affect sewer rate revenues. r- �a ■ Capital project cost certainty. The Capital Improvement Plan contains estimates of o future project costs. The actual costs won't be known until the projects are designed, bid, and built. • Inflation rates. The projected rates are based on a 2.1 percent annual inflation rate. Changes in inflation rates will have financial implications. M_ • Interest rates. Interest rates that differ from assumptions used in this Study will have financial implications. 0 CL m • Changing sewer flow patterns. The sewer treatment rates shown above are based on the flow and strength of wastewater. Water use patterns in San Bernardino are E changing as a result of the ongoing drought. Changing water use patterns might % affect the flow and strength of wastewater from the Department's various customer F classes. If water use patterns continue to change, future rate analyses may need to reassess wastewater flow and strengths from each customer class as part of a cost- of-service analysis. N V 0 0 c m E r �a Q 16 FG Solutions,LLC 051115 Draft Sewer Treatment Report 2.A.a Appendix A w co 4, c E L L 3 m co c m E t m O. d L r m r co M O a m r c a� E m a� L H L m 3 m cn r- L LO r r r 0 Ld C E L U m a fSOLUTIONS y Packet Pg. 30 (Apn;S;uaw;eail jameS;uaw:pedea jaleM 499£) `d xipueddy;uaw;eail jameS 9 �90 :;uawyae:Pd Q M N IL � m a � CL a N W aV� (� 14, Q a EP 27 I ! Is 31� I� U ITS (Apn;g;uaw;eajl aameSjuaw:peda(3 aa;eM 698E) d xipueddy;uaw;eaal jemeS 9 �90 :Iuawyoe:ny N Cl) a N � IL N Y IL {C X N M 0 6 (O X 0 0 N N `ate m W f9 N a IL LL E a r � W m s LL s 3 11) LpIL � � � v LL LF vv o 0 0 0 g g g � � O N (V (V (V (V .v C o $ 0 0� - — a o v 6 8 rvF� $ ADS N � � o o � � a, aCD Lc) N o _ _ N 3 Hill M z @ � - ME p' gy (�( �'p_� �- �5 _ o/� C (V CM V C C C -F� p C t C jN M V m o r c0 m 2 � CO r N N N N N N N N N N (ApnlS luawleajl aamaS luew:peda(3 jaleM : 698£) V xipueddy luawleail iameS S666S0 :luawy3elly � M eh Q d � � N co � Y a -3 Q z X_ ca co ca ca cv ca m co m m co g Z z z z z z z z z zzz w Q a' Z5 a a �, zzz � zzzzzzzg zzz zzzz -c—_ M = N zzz C7) cu (V r r (V r a� is� U N V, _ P o - Z r � a) C14 (C6 7 LL (pU N N U N M U) ��.� � F j c) L a (ApnIS 3uaw;eajl jemeS;uewljeda(3 ja;eM : 698£) d xipueddy;uaw;eail iemes g666g0 :;uawyoe:nb Q N N ���� zzzzZ0000Zo RoizZoiza d % +• �g o 0 o q o� m 10 K yz U ¢ cc a X �° °° °gg5�q°q �g0005�000 CL H CL 20000§§§§0§ §§0 0 0 g 0 0 g tt�55 C�S in o o R o 0 0 o g g g g o g �90 0 g tt�33 S� � n R 0 0 0 o g g g g o g o g o 0 o g o 0 p Lei tt�SS tt8S5 LL�55 ttSS �LL�SS tt�SS bbP R o o o o g g g y�o§ g g o 0 o q o o p a tto33 tt�SS LL8S5 dd� Itt�SS M�t�S t�i Mr � k» ^N`a @0000§§§§0§��g §g�o D o g g O P SP 20000§§§§O§ g g o o o g g o g �8� t5 tS ti Si of $020 Lo 13 C?Po m 6 m mfg m v > $p � 9 �o 00omb m� i��0��y 0227 d F 2d Fq M b3 N yf _T (7 �83iG 2 sF3�3e ° m Q m ry� T 50 F a 2Y p N N N N (Apn;g;uaw;eaal jameS 4u9w:ped9a.i9;eM : 699£) V xipueddy;uew;eajl jameS 566690 :;uewyae:gd m LO d m CA a Y V a � x a s Z W a a c� 011 e m o o m o e m o o o m9 o o m R o 0 o R o e e R a o Z N NN Z ON N Z ON N Z O N N Z O N pryN Z ON N Z O N N Z g N N Z ON N Z of 8N N"W N N N W N 101 009 Till] OmPB V91 Oil 9i,m1N Vii ?0§ MW ME }) q on V go q go c0 N N I o P g M1 g g �[l M � qv g o- E r go O N cr'l m LL M_oil� 9,19 Vii Vf@ Alto Noll VIE V0 Vio E�t[SZCt RS E@ My go AgS3 1 g g a !(i°' g 1g S t�o°Cm V Ng V g u? of1�A goes 5"'m � QQ,, g ❑pp loop{� p q{Q� VIP Q 5� qq 55�� c� ❑❑Q s loss gg pp Q p ❑pp 55��qq 29 go❑@ poop ^op@ POgN_ V IP 2CSHO 11§9 V 99 9991 gSlGSM FMS g�S LO 4b�i ivS° g 1P��o 0 iFtl3°.' gqS 1k�n M8 iqcS to r `V R3 P3 `q`g IF �0°J goes S3°m v 1o2p Vpo VNI 1,19 VEN VU VEP Pope POP 9M Hal � a p 8 m Q a Q Q y p g Q ym cys gRa E b b 6 6 6 b 6 b 6 6 b 6 b b b b 6 b 6 b b 6 6 6 b b b 6 b b b b b 6 6 6 �q��Eg {�� Q cE� 5E��5���❑ �p�{��€q gpE�p'g �qp ,r�,��r� {�� q gg q�4� Ff Ff g obi§ ¢001 2fySomP1C9 i�ofJO tr79 G NSA I�o cN pP 4^�olpr�m� P, E SJ01 §X19 ¢N th SSW mdm �,K m t N M m N gag O� f� k m 8 a V q LL]Q (p P N l�l a in g- g o 0 a m-N o iQ�W LL ^i Hal 11MI 14111' 1111 11111 1111 1111 1111 NO 1111 1111 IN! nn vyl go yomg Poppy �mqq Olga Pmpy a-WA also yogy y m Am Nod boas yomy No§§@ vqq boy, P-E6 yyy °oso �mvy yyyy Am � r �� 4e K- 0 a k 498 g 04 � m� � to a goal gaxv so Sm4i logs MAP 6011 MA 096 011 moll 6119 WN M4 Q ST C 8FF a SO g f949 f"xx p t8 9 °cam gg8g I-v- Ro moll omoo 00000 0000 00oo Cool 0000 loll loll 0000 0000 V p 4}�dm3dd LL U U I'��Nmc�no�mrno���?�'oR�o'EaN£Y F3N40 E0 Fi Y'v R1 b3mFl F7 o5'�3 f9 Fi�3 P38v�`�S"�`&G°a'��43�n£�'&33S 4R 481`n u°3�438m (Apnlg luawleail iamoS luawliedad aaleM : 699£) d xipueddy luawleail iamaS S666S0 :luawyoeuy to M Q N a d a � X a a z w a a N N Z a5 N N NNa6N NN c1 N Z N N NNatlNN N NNNNN NN ZCS OSN N N N atlN NNN NN NN atl NNN N cl cl mill 11 ci 9C spf gaff 9����sa � Y N r r f gK q el 0 pig rgpi ff pFgffv �gg g K�gEf g 00000 00000 �pp5°�S3��f yy2lSbnS �n°�ipd° � ° p��ruNQ� yS°D� � � M tV M ltl` I�r ttl IC N Si gg g fig" g� pg� � �$m 6 � 5� q� 6� m�s �{E6� LL I�LL� � ��'�m�II 6 H� � lO U1y1J h� tO LL A � ��� i a jFdB�S�����RnF'(�'n 'I�'fe���535�8!&38,1A83G�93838b8r'8844£4588°��'�'��`O�`r°iR�FJ f3�lOE0��3Ri�3�P1Fi�S�3f8 (Apn;S;uaw;eajl jemeS;uaw:pedap ia;eM : 698£) b xipueddy;uaw;eaal jemeS g666g0 :;uewyae:pd CO) Q N N d s �+ d Y V Q is X a s Z W a a ELM O N N N N O;:N""w NN Z Z N Age �� � ° � v zo t sE; mj MOURROgRaw " i a � �OOF III HN (ApnjS;uaw;eail jamaS;uaw:peda(3 ja;eM 699£) `d xipueddy;uaw;eail jameS 966690 :Iuewyoeud co M Q N a - a+ CD Y V Q � x a. s Z W a a AA f�gf Egg F NcS a5gr5 a5 r5[3 rf dfMO5 a5N MCI mNmNNNo7NN N5 c5,1 wggkoq0V Q p pp pp,55�2 pp y� QQQQ{q�p�� q Q ^� L7��iPS�t1S��Mh7�bN�h'o_ �� �CSmMNn1K�b3 trS b p N aDf aDI 9 z6 grg UN3 ca 9 5 � it (Apn;g;uaw;eail.iannag;uaw:peda(3 ja;eM : 699£) V xipueddd;uaw;eail lames 966650 :}uawyoe:nd d d U a 10 X a z z W a a aim a P ro a � R zi va x �gA �M $lea—$� � Jim C H (Apn;S;uaw;eei.L iamoS;uaw�edad ja;eM : 499£) b xipueddy;uaw;eajl iamoS g�6 X90 :;uawyDe�y � o v Q � a N M M (3 15 G) O LA (L X M R N § � § N N N Z N CL LO w ° ° CD 0) Fz ; (6 ao CD U ib F) 'Ila CL � U; T � T Lo y �_ U) W� N cn cn ) C5 LO LL 3 � E X X S jN co rt Lo co � w m �2 ; (Apn;S;uaw;eajl iemaS;uaw:pedad ja;eM : 499£) b xipueddd;uaw;eail jameS 546650 :;uewy3e:4d P d N d o d D Z W CL a Q EJ� $ 3 E. SK I m: U t�J m a N Q O J E i Al o b D O N t0 C N Ul Ul 3 m a� U (Apn;g;uaw;eail iomeS;uawliedea ja;eM 699£) b xipueddy;uaw;eail jemag 966690 :;uewyoeud � N d � d m a a. x v z w a a a d5 � L6 t5_� � Mc7�b52`S oo � �yZooS� $ � Z � t5 t5oo� °s �i � `m+af (Oph m 8fi (V y Q�I�(V yN� N N $� �p�p � 8 �j O O O O O O O m N N gg R gg �R qq QQ fA lL 5� y� 00 y� c� 25o d5 � mn °m1�25o R ti 28R500 � ��� 2RG T > m m (V I: (O r CV tV N (6 > m lL qq pp 5Q� q Q p QQ qq QQ fQQ� QQ, daS n � mi�25oo US ° oo00 E% n oL5t50O � bf 25 td 998 N } (V �r N N (V V } N Z �( 4 4l IL R A q q ft+A1 q 51633 .a Q °o y� o g o o 0 0 0 o D ID_ o Iv l cMy ti 2Q5 0 O M tQi 2�<pi 00 0 0 0 0 0 O Itl I N LL"3 O O O N (D 4�[ cA [Cap N m N V T a T/S } -s q g oW� oo A LL LL '- N m V N(D m m �W K (Apn;S;uaw;eail jameS;uauapedea aa;eM mo b xipueddd;uaw;eajl jamaS 966690 :;uewg3e:nd M Q le N d Y V l0 a d x 0 z W CL IL Q H3 O fA LL Mf H3 9i fA di f9 NC o N 93 6-1 81 ��pp Q lL E9 m ay v iE EP �n m 999 9 �� � � � � ryN�N ° swap 93 N 91 fn p N �a Mini E; cv Zl ? �69 � o o � o ID r a d� Z��$$ m t5j F F- F- � F �� �J �� � } � 1 5.li �� �t7S N H (Apn;s;uaw;eaal jameSjuaw:pedaa ja;eM 699£) V xipuaddy;uaw;eajl jameS 966690 :;uawg3e:ny d a N � a d Li ca a a x 0 z w CL a a �Ny CO N H CO (V 17 NE13 ry C� n J3 a0 f(C-Jj co Lo o 0 0 o o o M H N O H EA Ef3� O EL H N H CV I� rn (V Ur N O S Y U1 CJ BBii � N o') 8 LPL 69 a � 69 LL 5 6 j � > _ 12 - 7b -ru p NN MM �p p� p NN �p pip p (Apn;S;uaw;eail jameS;uaw:pedea aa;eM 699£) `d xipueddd;uaw;eajl jameS 9666(10 :;uewg3e:4b a to d v N � LO LO a ; � i LO Q x 0 z w CL a cu a m 0 T c ^ - _ LOS NN p g a N C (pO� NNp (O CrrO �o�q t4 pmMp ON I� Np�o M �6p7 M� (� P � LL A Gq t3 f $ S c2 N co N N T T Q N T . rD .� � 75 ;uaw:pedea jaleM : 699£) doys4ioM punoa Aj!3;uaw;eail aameS pue uoiloolloa jameS :;umpe;id w d Cb �i a d Y V t0 IL Lo U �..� z O :D N O � ® U N ® Ui >- Z � wI Z >- <t LLJ 0 Lu �— �— un <C 0 u umi �C N ;uawliedad ja;eM : 698£) doysMioM Iiounoo Aj!3 IuawIeaJl JOWS pue uoiP01103 Jannag :;uaw'43BPV a � a t a) Y V m a- -6J 4-J (3) O 4-J : C- L E O L E ® 4-1 E J c� 4-1 .� ft 4-J S i � �-' ._ LA � > 0 - ) a :tf o — Cal m 4-1 O 4-J O O ° O E O u o a c E ro Ln 0 U Ln _0 Ln w � CZ U Es � tn s M U u mew7ped eQjme« : �98) do4s jo«1!,unoo Aj!3-ju9wjeaj.L 2meS pue uoia! mRD ameS :uew'43e !! ¥ � $ � a / \ ƒ � a 3 2 \ � @0 CK. a / 5 ±3 § a) / \ 7 �\ \ CL % 2U ƒ ca � ° \ \ c = E . \ 2/ ^ uj « \ \ / � � � 0 \ / s Eu LU £ § / � V) V \ cl. 0 cr� 0 Uk§ }� . ®kk7 � } 5. uiI / / u 3 2 »� . . . Q o - I � ;uaw:peda(3 ja;eM : 698£) doysNioM Iiaunoo Al!o;uew;eajl jameS pue uoilDelloo jem8s :;uawyae:4d �i n, r d Y V 4J r..1 aL V V X rd v � �-+ L-Ij mss ." = M U � .� a� L+= � � � �~ r i N N N N Ln .� � i N � �., w O V) � QJ cn (V 0 >, — �J — z, -0 -D: -0 L- =3 -0 L >O X O N cci aJ v O 0 v ftj -c c� 4 . r� O > X aJ X Q 0 4-' :3 vii V ul � �^ O C Z X QJ . :3 a.., =3 to Q aJ fz � N i aJ ti v) E 4-J 4' • � J x > co �J QJ V Q > LLJ N 0 ' • LA _0 LLJ LL Q) C: 0) m O� >,� 0 ' v i �s00 in (Z � 'P �O 4- O O > c� u�� u 0 C!CL O O u� v aJ Q aJ u QJ =3 C •— L > O a) 0L uN � r� u 'j aJ L ate1 � aJ >f V QJ ate-J� V 4J > aJ — V .0 fV 04-1 i i vii` v1 > 0 � a) a) 0 rd_s-_ 0 � p� Q � aJ . rd � 0 QJ a n Oa N .— a + 0 Ln L L N Q > • L Q W • u L • juawpedaa jaleM : X98£) doysjjoM 1iaunoo Aj!C);uaua;eajl ismas pue uoi;aalloo Jamag :;uauayaej;y � o 0 Q � �•i a r a) Y V R IL V) Z LL O .4—J LU 2 4—J LLJ p 0 u u u i■i� � 1 V ;uaw:pedad ja;eM 699£) doyslioM punoo Aj!o;uaua;eajl aameS pue uoiloolloo fames :;uawgoe;;y U LO Q a N d r N Y V cc 0 a 4d .— C! i sl AM S cc` l�l L 4=d O 0 i Ln ®� tA so ® Ln rn O M �l 6" /l 6l 0 0 0 0 0 0 0 0 0 0 l Ln 191' M N r Ey4 A^ b&1 A^ b<} b�} ;uawliedaQ ja;eM : 698£) doysljoM punoo Aj!3;uow;eajl jemeS pue uoi;oalloo jamOS :;uawy3e;;b V N LO Q 6 N d r N Y V � a � 1- lD O rl r, L11 O N Ln �t O c-I M oo M o � v \ o r oo m L / } LL t!)• irk w * n L) o M M 1-1 00 O M rfoo oo oo o m ((y � r; 00 o ai N M N O O "1 c-i M 1" I-I V) O N r4 O } C LL I V} M N m O C 0 � N c1 M O N Q� F-I N 00 m L n • 1Y O .\-1 O M O f c rn 1 �o > O c-I N L' lD N M N c-1 N } ® ..l_ _ C +� ® 0 CD m Cl C7 Lr1 O O l.0 rl V' _ 1 lD Ol U � N M f6 } � LL -Ln i/} U. w N O O -I ca a0 n O II � N O O N I E CD r- O M M a1 O Lr1 M N N ® ? N m Ln LL v O t/1 ICI U 0 O L 3 v a1 U Ln � XCD N LL ca Q > � O W Q a 0 4J X L f0 -0 LL' W n u 3 C C, M- C O O v D Qj ;uaw:pedea ja;eM : �99C) dogs)ijoM paunoa Aj!:D;uawjeajl aameS pue uoijOelloa jamOS :;uawyaelly V M to Q Cb N d d �.... Y V !4 v v U- a :3 �+ U c q > Q i v x cc� w LY Y r oa I I N � N � LL 4J Q O ro N � �+ N N LL C w O LL u L V O 3 � ° N O O O O O O O O O O O O O O O O 1 O Lrn O Ln O Vi O Ln 6q M M N N b9 b9 b3 b9 b9 b9 b4 b9 spursnoyl ;uaw:peda(3 ja;eM 699£) doysNjoM pounoo Aj!3;uaw;eajl jameS pue uoi;oalloo fames :;uawyoe;;y N d .r m Y V t0 � a � r-I Ol ri M M N O ci fV N r� O N U- AA- * O 01 O 1000 M DD v1 N ` nI- to N l0 00 00 O N rl N ® } ® to O l0 ( w`J OG 05 O O l0 O N p , � U N L N Ql N lvD `-{ 11 rIq N l0 _0 O r-1 W N M � LL 7 r- C � m o > rl 00 ® �> N rr O O � O � m ui cf C rl -zt l0 N R* O O N U1 U } ® � w C () O (N O W —1 N m � 00 O Lrl I O O .ri Sri Sri Ln n M N o O --I N N M i I 4J 4 Y/ U L". D LL ® X � � � � � v c c c V U j v x v x v > fl L7 = w O v to to �+ dD 41 c E ru C L- O O � Z � juaw:peda(3 ja;eM X99£) doysjaoM pounoo Aj!3 juaua;eajl jamaS pue uoi;oalloo aannaS :;uauayoe;;b LO Q "' N 6 a d Y V _0 ea U- IL LL C C C O Y 0 �p > U v x v Yl v� p o o i I � x I � � W oa I LL LL � o C) } 0 } 0 o cn } LL O O O O O O O p O O CD am oo �o Ln zt m r v� to n in v� in +n v> Vn spuesnoyl ;uaw:pedea ja;eM X99£) doysMioM punoo Aj!3;uaua;eajl aamoS pue uoi;oalloo aameS :;uawgoe;4d � m Q � �i a. r a� a. 4=J O >` rm a _0 4-J M dJ ) o � V O Ln u s � O O `^ 01 C .c LA ra .0 LA L.- 4=d O N Q O a 4' u 4-J rd. >, 4-J L� c� 4-J O - ;uaw:peda(3 jaleM : 698£) doysN joM punoo Aji3;uawjeaal aameS pue uoiloallo:D aannag :;u9wLj3e;;y Lo d 6) a d Y v cc � S a 4-J lJ 4=J � s vi a_+ O Q 4-J u � E > �_ 4; +-J Q; C: w a) E u > p E O aJ 4--J O O �. O .E O _ ` u O 4-� c� O Ln �� Q L) L) 9J i Ln -0 Ln i • � n O ;uaw:pedaQ ja;eM 699£) doysMjoM jpunoo AIi0;uowleajl aameS pue uoi;oalloo aameS :;uawyoe;;d co LO Q 6 �i a- t (D Y V �4 a In O m E 00 E Ln 4-J w � 0 4-J 'O ul C E vl u •- s V) > o � o LA U 0 Ln AM I u ro U o > � �`• s p `` L4-- • — O Q E ro ._ U s O- W 4J a� +j '�-j W dJ Ln o In vi V S C �4-+ _ 4-J i--+ .� O O •� .� DC > Q V juawpedaa ja;eM : 699£) doysljoM Iiounoo Aj!o;uawjeajl aameS pue uoijoelloo games quampe;;d CD uo Q N � a a> J9 U Wp � w (nw0Z a. V 2 V Z Q r) cewce Qcn z0C) < — Q � :Dm i = � = ce LJC) cn � L w O � C ) � p ce Z 0 a Ln E w r � z � w w Z � w cn �- � w O f— Z sn ._ ceU cn > Qww acn • �: Q = a- - w w ® w Z = � oUZ e °C zw `°' C� ®e Q O w Qcn � � � � Z O °C w< L/) ce w w Z � � w C) z 0 J n u D ce C) w w >- Ce 4=J LU Inc U Lnz = U Uw ® OZ Z — U � ,Q ww � p cnZ CP Q — ® - = m � ce Z Q ce w U w — Z Q c _ � cnz E- - Q � QOr � — Qoe V) Lu U cn cn ce w m juaw:pedaa ja;eM : Lggg) doysljoM pounoo Aj!C);uaw;eajl aamag pue uoi;oolloo aameS :Iuawyoe;;d Q °m �i ate' r N Y V V) a 4-d o c r) O ® � Ln .- ._ ® -0 � 00 o0 `� Ln Jc: u � s .- cr ®C Ln r� O .- i u au ® O .`r' O E E u 4-d u CD ® � cz V) 4-J O � � ;uawlieda(3 jaleM : X99£) doysM ioM Iiaunoo Aji:D;uaw;eajl aameS pue uoilaalloo aannas :;uawyaejjy N � a d Y V as `V ° C- - a 'u E Q c� � o w Ln._ rz c- 0 -i-jm 4-J 0 0 ,_ Ln u � N � o o E °a E > J c- � 0 a� °J � Ln u � �. C� Ln O Ln 4-J r� � 4-J Ln cn E ® E m tv _ Ln L 4-j Ln E (v 4mJ L 0 ro 4-J '4-J O O O '— Ln •— DC � w wV) LUUJ ;uaw:pedaQ aa;eM : �99C) doysljoM 1iaunoo Aj!3 ;uawjeajl aameS pue uoilaalloo jameS quampe;;d V N Q to N 6 Alda a� u a .� C- O J o cu V V O E -0 0 •cn _0 •� 4-d i O 4-J O •Q Q (� > 4-J i u O 4 4-J V >' 4-' o �n •4-+ CD 0 tea, � � - .1-0 (V a, O � > ._ aJC F � >, . Ln 4-J V 0 -0 0 c� > � o 4-' O V) 4- V — L. L- juaw:pedea ia;eM : egg£) doyslaoM pounoa A;ia;uawleail camas pue uoi;oalloa fames :juauayoe;;y V M Q c0 N 6 a. cc w d a w o � a. lqj IC3CL i :3 tZ L.. a� ,; � � � � �� � '�'� r � q) i� VO � � � E � a000 � '► � j ` - u0 O � � 0 �+-0 t O '— Z 0 qa, `^ t � w Ce v 4J U c� q) (3) o 0 0 C � ® u � .0 Q) ° tn qj u � q) a..r ft.. 4-J q, o {: 4ft+ N 4.j ., ��O 4-J 4.j cr . 'A Z (3) ;uaw:pedaQ ja;eM : 699£) doysMioM Iiaunoo Aj!o;uawjeajl jamaS pue uoi;aalloo aannas :;uauayae;jd m N a r d Y V R IL cz w con MIL No- Ol Waw:pe eQjmeM : �§Bd dot's jom H,unoQ �lQ;ua e jemeS pue uoia■ mRO 2meS :memgae !! V k co a .19 u a ». 1t �d . . «� - \ , .x. . \ / � /` ■ � � \ ■ ��i � \ � ;uawpedaQ aa;eM : 698£) doyslaoM paunoo Aj!o juaua;eaal aamag pue uoi;aalloO aameS :;uauayae;;d V t0 CD ci a d Y V cc a x t n w Wem:ped aQjme« : �9 0 doLls jo«I!,unoQ ■Q;ua e ,amoS pue uoia! mRDje«es :uemt4ael; v © W � .bc cc CL � ` ■ . a -- � \ ( °/ juaw7pedaa jaleM : 698£) doysljoM paunoo Aj!o;uaw;eaal aameS pue uoilaalloo aamos quawyaeliy co Q to N � a a� Y n. r iw s i . r • ii •i �S M1 juaw:pedaQ jajeM : 698£) doysljoM pounoo Aj!C);uauajeaal camas pue uoi;oolloo aamos quawpe;;d rn Q m N 6) a w d a M k iFL�y r r � w i ro+ w r rat r r luaw:peda(3 jajeM : �99C) doysjjoM paunoo Aji3—juawjeajl aameS pue uoi;oalloc)names :;uauayae;;y 0 Q � N � a r a� Y v ca a • >.« y10, f 14 y M sr ,� ■ } Y ■ �- Rt Wewlied eo,meM : 99C) doLls joM pounoo Aj!3—juawje9j.L aemeS pueugpmRD ames :memtiae !! ¥ a � � IL § \ � � ■ , � ~ (\ � � ® ■ 2 » » < ° > ■ . � � ■ � - j �■w - y � . / ■ � : � ^ ) ® �� ;uawlieda(3 jejeM : �99C) dogs)ljoM punoo A;i3 juaw;eajl jemas pue uolpapoo camas :;uawyae;;y v N Q N G1 a m Y v t0 a um 0 L) CU 0 u �r1/ J ;uawliedaQ jajeM : 698£1 dogs)ljoM Iiounoo Aj!o;uew;eajl aannas pue uoi;3alloo games :;uawg3e;;d V M Q N L IL a� Y V cc a 4- Ln •O O O O .� z O © � dJ �- N i •— ,� °— — 4-+ O (V Q L 0 O 4-J VI E _ 4-1 � •� N O 4-J �_ -0 V) O ► ' Ln ate.+ 07 C- � � � . ate+ (V _ O E — O Ln 4-1 U 4-J V)-0 V) � � � (V � c� um .61 tA U � uOcn � � uuU � Lncce ;uaw:pedaa ja;eM : 699£) dogs)ljoM Iiounoo Aj!o;uaw;eaal James pue uoi;3alloo James :juauay3ej;y � v d a� Y V a Ln Ln Un o .® M o •— M M �- bq bq bq •� cz E 0 C KOO o cz C) ® _ N c� +-+ O N cU � M �. 0 QO 4-J 4-J > \ O U o ql- M C) 0 �- o� 000 01 N N N V c� • Xr) L- juaw:pedap ja;eM : 499£) doysAJoM pounoo Ajj0 ;uawjeajl aannas pue uoij3ejjoD games :;uauay3ej;y LO Q ti N � a aD a 4-d m Cie r 0 N 01 � ■ �� Ol O t9 kf� 0 � n � E • Lfl LM Ol O 0 ty9 W O O l � O O O w 3 O tyv tsj II L CL U 0 U ;uaw:peda(3 aa;eM : 699E) doysN ioM punoo Aj!C);uaua;eajl aamag pue uoilOolloO JameS :;u8w'4OB;;b � n a �i a as Y v R a L a-J .� C- V) O 4 .� O >, a� 4=J � i - a) 0 �^ � aJ . O 4=J u a^ J Ln ft E 0 Ln E 0 4-J E � i 0 M c — 0 0 07 rtt O ._ ._ — 4 a � ;uewpedaa jaleM 698£) doysMjoM punoo Alit;uaw;eajl aamag pue uoijDapoO-'emag :;uawy3e11y � n Q ti N � IL d Y V �4 a l/i 4mJ .. 4'•r 4-J 4--+ .� CP ` ) ^�^ 4-d 4=J 0 E �n E > 4-- �n vmoon Ln 4-J 0 Ln - a-d i g � Ln aJ ® 4-J ._ 0 V ._ IV 4-► ® -� 0 4-J 4-J 4 C: 4 (V ._ W LL- 0 L Ln Ln �- t `- cn V juawliede(]joleM X99C) doqsljoM punoo Aj!3—ju9wje9jj.jameS pue uopelloo games :Iu8W43ejjv IL as m a. ;uawpedaa jaleM 698£) doyslaoM Iiounoo Aj!0 ;uaw;eajl jameS pue uoi;oolloo games :;uawyoe;;y Q CD N � IL as Ad 0 m a s 4-' C) = a- ® LL 4-J i ._ 4=J �1 .-. .— �•' • E >1 4--+ L- I- 4-J ® .Ul LU O i :3 O .m O a O W C C: M V a-1 o C)� � � 0_ •�-+ � .ate-+ � 0 4—J m .o V = a✓ � � a� oC oC > 4-J a) ro (V 0C .- O . 4-J Q > Q a~ �' m > avE 0— 0- 0 ;uaw:peda(3 ja;eM : 699£) dotisMioM 1!3unoC) Aj!0 ;uawjeajl aameS pue uoiloolloo games quawpe;;d � o Q o LN to IL a Y V R a * Ln a) m Ln Ln It N Ln 00 0 N LD LD r- Ln a) m r-1 N lc N o N m Lr o m Ln t o t N N Rt N n O r, t m r4 Lb Ln ri It 0) N N 00 m N m ri } N LL t 0 m lDD O � 00 Ln N m - 3 N m o0 Ln r- ri }+ rN m -I Ln dam' N Q1 07 0 o m o t.D It m Ln 00 Itt N Ln N rI Ql m N N N } N O LL U C o _O v— � N J) C� N N r N Lin. m m ® OCR N r-I o0 ' r I 01 L r-I 00 o r- r- � Ln m I N 0 r-i O1 rl Ln Ili N � 0 i C ,/�) � O Ln m N u1 N rl� k.0 O rl� EU O w N ro LOL qA � hc m X O B I mr-I I OR ri O 0) - r I N tD D ot\0 Ln O 0 r�i � Pm �Y p r I l o - I tea O r-i 0 r-i Om Ol II Q N r I O m N N Q) C } r-I N Ln ■ O w _0 E ® N r-I O 0 O N 00 IzT L ro O N r i o0 N 00 N � I O U � ' 00 lD n O ' ' DD t.p r- � 00 G (7 14 00 LD zi L r, m Ln r" N m r" to '- 00 Ln O Ln ri IZT I C Q� N ri 0, m Ln O LL — I I O r*j o X +, o m z rI io ro O N ra N C i N C L 0 L O O fu 41 O [2 '^ U i i v d O _ C Q C Ln O C m •C Z u C C O L } O C *' cC >, +J O 41 L 4J ro L Qj Q a w ;uawlieda(3 jajeM : �99C) dogs)ljoM 1iaunoo Aj!3;uaw;eajl jamag pue uoi;aalloc)aameS :;uawyaelly Q co r a .r m Y V IL N v c c v v DC W ■ 4o 4o 4mJ C C m m CL CL � � o 0 om (a ® O � � O > *Al� a) �r ® 9% ._ two `. (lam �y 4mJ .� �roF ++ (A I(y L �r% C' x CL r �y V Q W r a °ex fly °° L g g °o y o- LA ° spuesno4l ;uaw:weda(3 ja;eM 699£) doysljoM punoo A;iC);uaw;eajl James pue uogoolloo James :;uawyae;;y d co N 6 a. ... as , a _O 01 4-J _V Lu 4 O U U . V 0 0 E 4-j � O 4-J O _ a--j tn C: Z `n n w M a cn Ln u O a-e+ 0 a..; E O 41 c: 4, --' OV V M Ln > a `}' 4—' O 0 ( I N u O O 0 0 0- 0-cn _ I 'V V cn Q -0 Q Q. 4-+ 4-- LU ;uaw:peda(3 ja;eM : �99C) doysMjoM pounoo Aj!3;uawjeajl jemaS pue uoi;oolloc)camas :;uauayoej;y U M Q Go N d a.r d Y U S 4-' 4J O .0 •— s > - • 1 Ln O 4-J co = c O E V) o o ., 0 lcoq O E u O '4-1 Q) s .s O o E Ln - 4- E rz E ,� >, a M " �- u O �- t 0 0 0 u O >, w =3`n L- � 4 � r Ln � O • •� O � u E 0 0 4-J oa L� Q) :3 >` s- U1 a -+ a-+ Ln 4-J �• E •� ateJ u _ O 4-J Ln ro E E .— N — O Ln 0 u — cry U 1.1.E . ;uaw:pedaa jaleM 699£) doysljoM 1iounoo Aj!o juaw;eaal aamaS pue uoi;oolloO aameS quawyoeUV U � Q Go N Cb a a) lie U cc IL O W 4-J U O C- aJ 4- O L. O m C: Ln L Ln Ln u Q N CL Q • +-i i LL. 0 v® u C 4-J M CL 4- w ;uaw:pedaa ia;eM : X98£1 doys3lioM Iiounoo pue uoi;oelloo aannag :;uawyoe:pb d co r a w d Y V a N C O O C a Q A � N N > > •o _I = 4- •v o l°e V) 0 o n oe, `� ro 0 �Oe sor e Pot m ` C,� J'°c,, be 0 0 0 0 0 0 0 0 0 s g ° 8 'Ile° o $ N ;uaw:weda(3 aa;eM : �ggt) dogs)ljoM 1iounoo Al!o;u9wieajl jameS pue uoi;oolloO jameS :;uauayoe;;y m co InNo a a d a c� M _> O M 0 m N M N 4 i Q cn b- �I O ,� ,� • �• rz vi Ln c� v 0 ow Un V •y � � v cz m v N 00 O vi - i • _N U1 C) t11 M +-+ v rz • rd --D �i M 61I U Qj • •�—� O U t� • .�4-J N _O O O O • O +-. *-' +-J 4-J U O V • 4J N N N N Q 0 i ;-+ V t4� E 3 W to i 4-J i i LPL i 0 0 Q E � E of " v `� � 0 0 � o Ln o Ln 'ro:3 Zf:� 4:�- U *k U I— U oC U juaw:pede(]joleM : 699C) doqsljoM pounoo Aj!07ju9Luje9jjL jameS pue uoiloolloo names :IuaLuqoellv X 0 cc CL 4�a Ul juewpedad joleM : �99C) dogs)ijoM pounoo Aj!o juaua;eajl aamoS pue uoijoapoo games :;uauayoe;;d m Q N � a m v m a E . . X >, O � Lr) v1 O V) 4-J i O O 4=J C a-v+ Ln 4-J 4J 4-J (3) = t ." u O _ •� Ul r) C: -- 0 �-+ O L O . Ln 0 -0 O u Q) Ln . Q Q) c� � O s L) (3) i ate-+ c� 4mJ Q aJ ( _0 Q� V) i ;uaw:pedad jaleM : 698£) doyslaoM paunoo Aj!C)juauajeajl camas pue uoiloolloo names :;uauayae;;b m a w N � a d Y V !0 a cle to 8 � m MR a Lo v X LJJ o p W E y LU 0 V m e } 4-d o CJ� ;uaw:peda(3 ja;eM : 699£) doysljoM paunoo Aj!0 ;uaua;eajl camas pue uopoello:D aannas :;uauayae;;y Q N � a m as IL 4-J L L 0 v 4-J 4-J 4-J cn 4-d 40 O C rz c- 4-0 -o' E E E � 4-d •N Ln O p� p >, c L- c� Ln LA 4-0 O 4-J 4--' � O Qj tA `A O v°r � r� i vi N V 4QJ Ln ;uaw:pedaa jaleM X99£) doyslaoM pounoo AjiC);uawjeajl aameS pue uoiloolloo fames :Juawpe;id a c> d r ai Y V R IL 4= M O N t9 64 00 M � N 0 r N N kA� ..n W anr L ® � U CL 0 juaw:peda(3 joleM : 698e) doLls4ioM punoo Aj!3—ju9Lujeej_L jameS pue uoiloolloo jem9S :ju9w4oejjV N CL Ick 0 u LLI ;uaw:pedea ja;eM X99£) doysljoM Iiounoo Aj!3;u9wjeajl aameS pue uoi;oolloo aameS :;uawgoe;;b V M Q � N � a cc r d Y V ti o 0 o R C i -j- LL7 00 a CDC --::I- M M N M i � Efy c-9 EA ff3 � O � c ® O 7 O O � � � LN L� O •� LC7 O O (ZZ> O O v Cf.) O d3 Ef> Ef3 Efl 69 Efl m U c 3 L-) r i- d C=> °o c � ® o C) Q) U N CO Ln '3) Lf7 ' CQ U C3) CV "s LX-3 0 C! f.-k f C-0=31� s» — C-> o O O M L1> C37 � C V M O L --� C7 1-. O �' I-- O F O 1� 1- oo 0o 00 O CA SfT Efy Ef3 Cf' EF} b/3 ■- O CV -j- 7 C3 3 '�-± O O LX-3 C"i D C v C3i rn C3- 0 0 c O N Q� C O Lc7 ao O L-'7 Ln Lc7 .v d d LC-3 CC) C7 00 00 0 0 d 3 oo o cv —i c CV CJ CV C- CV Z coC4 Ei ZA- E� V-3 f- ® y 6) r- 1- C)O CV 1` LO f- Cfl C70 � CT �� CV M LC7 1-- U CV � V --ZZI- rt LC-i L17 4'J Ei9 � Cf1 Gf3 6/=l Eft Ei9 7 0 D 0 C 0 ` C � �7 M �-c::- ® p) N LC--S CM) C7 CS) C1 7® Q C y O d n L O O O O CD -.,. ... d Cf� O � LC7 lr) Lc7 L.C7 L21 o U c cV O O C--P C-C> -3- C C 0 0 0 3 � 0 0 � C< oo C-3 cri o 0 o 0 0 0 0 0 (Q Lc7 LC3 L11 LC7 LC7 L[7 CV cY � Ln OO 7 CV CD CV Cfl 1- OO O C37 1- I- y Ca I ;uaw:pedaa jaleM : �99C) dogs)ljoM pounoo Aji3;uaw;eajl aameS pue uoi;oallo:D fames :;uawyoe;;b v v Q rn N � IL tv ae 0 R IL U1 ® U) 10 CO N N j N C7 — q t0 N U) to 00 C7 t` 10 ( N f� r T N M r M n t0 m n m e ® N C ' VO «� N N C7 to 11) M fh M N tV N O V) V> V) V) V) V) V) V) (1) V) (f) V) ►- m Cl J M N ■— C N � t V) L S �� ` d ° C �) M d �[ o do Qi w ai m e p of 0) 0) z 10 z z a z n: vi 10 A c�iV) V) V) Z .- 2Z � Zcn0) m to m Nt u P `2 O D U Q - C N ro a m u m W ci 3 co s 0 O in co O co co 0) 0) C �j t N m A tp C d 1 v o E z z z z - - m to N N ='- 'VC� c d - C " ti I Vl SV ® d ^ C C ti E V) � i 6 ` N ` co N y V ti r > Qi 0 � (q N v U 4 U C C m .Q Fo C U) W G ra V N a 4) J Q1 O r N .Oa Cl vl O N 1� U) r N C tti _ w rn N C 0 V� o 0 C1 1 /"1 vm L U v Q v J r� 1� ?, 0 to cp m C co E . 4 co � N M ID ' s 0 tv C N � O J a ® c LD �C Qi � C � J� v� to r c � 9 _' E n con } ro w a ov0 � o � o � tS v9 M Q Q `� c v di m s J to -v E) 1) o L mL1i (Ln. a � � wQc� -i � a N �, � �' � '� � U) �° o C m r N a}i 0)C E v 0 0 ti 0 0 o C') 't L} L O � t � J Z N tq W v'i v .00 �' CL ;uaw:pedap aa;eM : L98C) dogs)jjoM punoo AIi0;uawleaal camas pue uoilaapoC)aameS :;uewyael;d Lo N � a r d Y V l0 a Mimi ;- x Un ;uaw:pedaa jaleM 698£1 doysMjoM pounoo Aji3;uauajeaal aameS pue uoiloapoo names :;uauiyoe;jy v co N � a .r a� Y V a vi 4-- 0 . +-J i F- ._ QJ •- QJ Ln C: v O ,� 4-, tn ,— Ln rd Ln ft rz cC >- u L DL c i w .a u Ln 0 V aJ O a-+ aJ O rJ i O O (3) .,. rz •� Ln tA •� Q) 4- - Q) 4J O 4J •— L,n �_ E u v� tA U- CL ;uaw:peda(3 ja;eM : L99C) doyslaoM pounoo Aj!o;uaw;eajl jameS pue uoi;oalloo aamag :;uawyoe;;b r d y V L 4-J a �l O 4-J L .L) .� 0 U a-J O 0 Ln 4-j E r 0 0U 4 U -0 (3.) x rz (3, Q, � o z 4- -0 s 'i c� O s O E - i 4-0 rz Q r� EAST VALLEY WATER DISTRICT ' LEADERSHIP • PARTNERSHIP • STEWARDSHIP BOARD OF DIRECTORS rrf�� James Morales,Jr. Ponald L.Coats Ben Coleman Chris Carrillo Nanette Shelton President Vice President Director Director Director John Mura,General Manager/CEO May 27, 2015 Honorable City Council of the City of San Bernardino 300 N. "D" Street, Mezzanine San Bernardino, CA 92418 Honorable City Council, of the City of San Bernardino: East Valley Water District ("EVWD") submits the following comments in conjunction with the May 27, 2015, Wastewater Rate Study Workshop. EVWD's evaluation of the Rate Study raises several issues of concern, particularly as the proposed rates are tied to the development of the contemplated Clean Water Factory. Initially, the Rate Study does not include the possibility of EVWD drastically reducing or eliminating its wastewater flows to the City of San Bernardino ("City") for treatment. For some time, EVWD has contemplated the design, construction, and operation of its own wastewater treatment facility. Once the facility is constructed, wastewater currently treated in City facilities will be diverted to the EVWD facility for treatment. Therefore, the City will no longer receive the service fees generated by wastewater treatment under the 1958 Agreement between the two entities. This will have an effect on the Rate Study as well as the City's financing of the proposed Clean Water Factory, which we believe will be based on bonds, supported by wastewater treatment revenues. An additionat concern of EVWD is that the costs attributable to developing the Clean Water Factory are included in the proposed rate structure as described in Tabte 6 of the Rate Study. Initially, it should be noted that EVWD opposes that project. Although EVWD contributed seed money to the project early on, further analysis demonstrates that the project will have minimal benefit to the District. As planned, a significant aspect of the Clean Water Factory is the transfer of treated wastewater uphill to the Waterman basins for recharge. In fact, the project proposes three methods of treated wastewater disposal as follows: • Treated wastewater will be pumped uphill to the Waterman basins for recharge which witl benefit the City; 31111 Greenspot Poad,Highland,CA 92346 1 Ph:909-889-95011 www.eastvalley.org EAST VALLEY WATER DISTRICT LEADERSHIP • PARTNERSHIP °STEWARDSHIP • Treated wastewater will be delivered to other City facilities to the benefit of the City; • Treated wastewater will be sold and exported to the Chino Basin to the benefit of the City. The disposition of treated wastewater as described above will serve little or no benefit to EVWD ratepayers, yet they are expected to carry the burden of the associated costs. There is no nexus between the proposed sewer rates imposed upon EVWD ratepayers and the service they receive to the extent those rates include the cost associated with the Clean Water Factory. Additionally, Table 7 of the Rate Study shows that the City has projected debt in the amount of $68 million between the fiscal years 2015/16 and 2018/19. Of that amount, Table 6 suggests that $20,250,000 is attributable to the Clean Water Factory Phases 1-3. EVWD questions whether that project qualifies as a regional facility under the 1958 Agreement between the Parties as amended over the years. That Agreement defines regional facilities as those which "may be required for adequate treatment and disposal" of wastewater. It is questionable whether this process is required for adequate treatment and disposal of wastewater as described in the Agreement. Moreover, Section 3 of the Agreement provides that facilities for the collection and treatment of wastewater are to be developed by the Parties separately and independent of each other; each public agency would own their own facilities. Accordingly, the Clean Water Factory is an independent project of the City, which benefits, almost exclusively, the residents of the City of San Bernardino and the cost of the project should not be allocated among the Parties to the 1958 Agreement. Sincerely, EAST VALLEY WATER DISTRICT AN T MP `~ Entered Into Rec, at CC/CDC Mtg: 2 715 Chief Financi Officer` Agen a Item N0; y: City C!er C[}C Secretary City of San Bernardino 31111 Greenspot Road, Highland,CA 92346 1 Ph:909-889-95oi I www.eastvalley.org