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Utilities Division

October 22, 2015


Study Session

Todays Agenda
1.
2.
3.
4.

Revisiting Utilities Division business principles


Role of Utilities in economic development
2016 overall Division budget and organization
Discussion and questions

20 minutes
20 minutes
20 minutes
30 minutes

Revisiting Utilities Division Business Principles

Checking in, looking forward

Rates
Culture
Continue to live within
our means

Costs
Continue to manage
costs aggressively
oExpense growth within our rates
oContinue creativity and refine
and implement discipline

Capacity and Service


Pursue opportunities to
expand rate base
Low marginal cost
opportunities:
Waste to Energy, Water
o Major link between Utilities and
economic development/growth
Sustainable development
Support targeted growth areas

Debt and Reserve Levels

Defined levels were critical for bond rating we received


Borrowing levels are less than prescribed in the 2011 Rate Study

Capital Programs
Integrated and risk
based capital program

Integrated approach for highest


ROI
Added value and added
complexity
o Continue risk assessment of Utility
infrastructure
Water System Loss
Waste to Energy Facility

Checking in, looking forward to 2016 and beyond

Environmentally and Financially Responsible


Meet and surpass environmental requirements while
maintaining affordability of services
Encourage protection of natural resources through
appropriate rate structures, conservation and recycling
Allow for growth while maintaining current water and waste
use levels
Attack water system loss
Commit portion of revenue growth in Utilities revenue/tax to
incentivize economic development

Role of Utilities in Economic Development

Economic Development
Transportation
Location
Sustainability

Incentives
Business
Climate
Business Resources

10 Key
Competitiveness
Factors

Roads
Rail
Air
Ports
Intermodal

Real Estate

Everything &
Everyone
Working
Together =
Competitive
Community

Utilities &
Infrastructure
Permitting &
Regulatory
Environment

Innovation
Entrepreneurship
Financing

Human Capital

Labor Pool
Labor Costs/Product.
Training Res./Skill Dev.

Economic Development
Transportation
Location
Sustainability

Incentives
Business
Climate
Business Resources

10 Key
Competitiveness
Factors

Roads
Rail
Air
Ports
Intermodal

Real Estate

Everything &
Everyone
Working
Together =
Competitive
Community

Utilities &
Infrastructure
Permitting &
Regulatory
Environment

Innovation
Entrepreneurship
Financing

Human Capital

Labor Pool
Labor Costs/Product.
Training Res./Skill Dev.

Business & Environmental Interests are Aligned


First Rule of
Business:

First Rule of
Environmental
Science:

Protect
Your
Greatest
Assets

Protect
Your
Greatest
Assets

River and aquifer are regions greatest assets


& greatest competitive advantage.

Evolution of Integration

Cleaner River, Faster


Formalized capital
planning

Integrated Clean Water


Plan
Integrated: streets,
parks, water, sidewalks,
ped/bike, trees, etc.

Rates tied to CPI


CNG Conversion
Operating WTE Facility

Reorganized around
integration
Set multi-year utility
rates
Sold 20-year bonds
20-year street levy

Sustainable Natural Resources


Integrated Approach

Environmentally &
Financially Responsible

Monthly Utility Cost Comparison*


Spokane

Seattle

Portland

Water

$17.86

$53.75

$67.26

Wastewater

$28.06

$94.72

$76.00

Stormwater/ Drainage

$3.95

$29.20

$27.16

Integrated Capital

$26.34

Solid Waste & Recycling

$28.42

$76.20

$35.65

MONTHLY

$104.63

$253.87

$206.07

ANNUALLY

$1,255.56

$3,046.44

$2,472.84

*Example is based on usage for a family of four in a single residential home.


*Charges are for inside City residents for each location.
*Water consumption is assumed to be 50 gallons/day per personor 8 units per month.
*Example uses as close to 68-gallon cart as possible depending on the options of each City.

2016 Overall Division Budget and Organization

Budgetary
Org. Chart

Wastewater
Mike Taylor

174 FTE
$34,477,862

Steve Burns

157 FTE
$39,695,503

Water
Dan Kegley

Integrated Capital
Katherine Miller

Utilities Division
Rick Romero

Marlene Feist

605 FTE
$298,037,157

Kara Heatherly

Solid Waste Collection


Scott Windsor

Corin Morse

Solid Waste Disposal


Chuck Conklin

Ken Gimpel

Steve Riggs

36 FTE
$11,694,170

Utility Billing/Admin
(Program)
7 Departments
6 Department Heads
7 Additional Exempts

Environmental Programs
(Program)

121 FTE
$44,495,286
76 FTE
$28,108,224

Fleet Services
Gene Jakubczak

14 FTE
$133,933,399

24 FTE
$5,237,320
3 FTE
$395,393

Rick Romero

Utilities Division

Ken Gimpel,
Assistant Utility
Director

Fleet
Services

Chuck Conklin,
Director

Dan Kegley,
Director

Solid Waste
Disposal

Wastewater Ops

RPWRF

Water Ops

Katherine
Miller, Director

Marlene Feist,
Director,
Strategic
Development

Integrated
Capital

Gene Jakubczak

Solid Waste
Collection
Scott Windsor

Utility Billing

Upriver Dam
7 Departments
6 Department Heads
7 Additional Exempts

2016 Personnel Impact


Water

Solid Waste Disposal

Education Coor. (Full-Time)

+0.5

Inventory Control Specialist

+1

Wastewater

Safety Coordinator

+1

Cash Acct. Clerk I

+1

Assist Plant Operator

+2

Project Coordinator (Taylor)

+1

Crane Operator

-1

Principal Engineer (Hendron)

+1

Ash Operator

-1

Department Head (Arnold)

-1

Maintenance Specialist

-2

GIS to Desktop

-1

Solid Waste Collections


Utilities Division Customer
Service Manager

Net Change +2.5

+1

Division Operating Budget Summary


2014
Adopted

2015
Adopted

2016
Program

% Change
(15 /16)

Wages & Benefits

52,125,943

54,394,424

55,626,208

2.2%

Supplies & Services

58,680,863

42,820,367

41,679,802

-2.7%

Interfund

28,782,582

34,089,313

33,950,491

-0.4%

Intergovtl Prof Srvs

36,573,759

37,649,595

38,886,140

3.2%

Other

18,604,706

12,166,372

10,776,467

-12.9%

194,767,853

181,120,071

180,919,108

-0.1%

92,178,790

110,679,900

101,472,136

-9.1%

1,517,237

1,647,749

15,645,913

*89.5%

Total

288,463,880

293,447,720

298,037,157

1.5%

FTE#

594

602.50

**605

Operating Expenses
Capital
Debt Service

*Revenue Bond Principal & Interest/ Nelson Center (Operating Transfer out from ICM to Debt Svcs)
* *After Online Budget Planner closed 2.5 positions were added for a total of 605 (See Personnel Impact)

Next Study Session: October 29th

Solid Waste Collection


Solid Waste Disposal
Water
Wastewater

Budget Summaries and Personnel Impacts


2016 Rate Review
Accomplishments and Strategic Direction
2016 Projects and Capital Program
Performance Measures

Discussion and Questions