HomeMy WebLinkAboutUkiah Valley Sanitation District 2022-07-01 (2) COU No. 2122-251
BUDGET APPROVAL AGREEMENT
This Agreement is entered on July 1, 2022, in Ukiah, California, between the City of
Ukiah ("City"), a general law municipal corporation, and the Ukiah Valley Sanitation District
("District"),a county sanitation district.
1. The City and the District agree to approve as shared costs of the Combined
CITY/DISTRICT Sewer System ("Combined System") for fiscal year 2022-23 the City budget for
direct expenditures of personnel, operations, and capital outlay, and the indirect expenditures
of internal service use of the Wastewater Enterprise, as set forth in the attached Exhibit A.
Total direct operating budgeted costs, defined as costs of Personnel and Operations in Exhibit A
of$4,470,482 as well as an Operating Indirect Rate ("OIR") on such costs of 14.20% ($634,808)
for a total budgeted estimate of$5,105,290 will be shared 50.09% District and 49.91% City.
This share is for 2022-23 fiscal year and will be effective July 1, 2022.
Total direct costs of$1,960,000 for Capital Outlay in Exhibit A will be funded by both the
City and District at 50.09% District and 49.91%City, as well as an Indirect Rate on such costs
incurred not to exceed 9%, which is the five-year average of Indirect Costs incurred and
budgeted by the Combined System related to purchasing, insurance, and other applicable
indirect costs, excluding administrative and overhead. This rate will be referred to as the
Capital Indirect Rate ("CIR"). The City and District will use the CIR on all Capital Outlay with
costs less than $200,000 unless either party desires to negotiate the rate for any individual
project. The indirect rate will be negotiated for projects over$200,000 based on an estimate of
required indirect costs to complete the capital project. The City Engineer or City's Water
Resources Director will communicate verbally or in writing to the District Manager when such
expenditures are expected to accrue.The District will pay to the City the District's share of the
cost for an approved capital expense within fifteen (15) days of the date of an invoice given to
the District for that expense. On and after the effective date of this Agreement, any portion of
capital projects paid by the District will be capitalized on its books as intangible assets and
depreciated.
The shared costs presented in Exhibit A exclude District and City administrative and
other overhead costs allocated directly to the wastewater activities of the City and District.The
City and District shall incur 100%of each agency's own administrative and other costs not
shown on Exhibit A.
2. For any costs incurred for District-only activities or projects (e.g. a main line
replacement of a District asset), that the City is required to perform or contracted to perform
on the District's behalf,the City may include in total project costs an amount to cover the City's
indirect administrative and overhead costs. Before the City is required to perform the work, the
parties shall negotiate and agree on the amount thereof to include in the project costs to be
paid by the District. In the event of an emergency or urgent need to commence work before
the parties can negotiate and agree on the total project costs, including indirect administrative
and overhead costs,the City and the District shall negotiate and agree on those costs before a
1
final cost settlement is made.
3. The District shall pay to the City by the 1st of every month starting July 1, 2022,
1/121h of the District's share of the agreed operating budget (Personnel, Operations, and
Operating Indirect Rate) shown in Exhibit A (i.e., $425,524 x 0.5009 =$213,144.97). City is not
required to generate an invoice for these payments which are fixed monthly payments to the
City by the District. As provided in Section II.D.4.a of the Operating Agreement,the City and
District will review every quarter the actual costs incurred. The City and District will reconcile
differences between actual costs incurred, budget costs, and over/under payments made by
either agency no later than 90 days after the end of the fiscal year(June 30) or after any
quarterly review as agreed upon by both parties
Per Section 6 of the Refinancing Agreement between the City and District, the true up
process results in a true up payment of the City to the District of$2,132 (see Exhibit B). The
parties agree the City will remit this payment to the District after the third quarter
reconciliation, no later than April 15, 2023.
4. Payments under Sections 1, 2, and 3 above shall be subject to interest as provided in
Section II.D.4.b of the Operating Agreement.
The parties have entered this agreement on the date first written above.
UKIAH VALLEY SANITATION DISTRICT CITY OF UKIAH
By:
Ernie Wipf, Chair son Sage Sangiacomo, City Manager
ATTEST: ATTEST:
Kristine `gwlar
By: Kristine Lawler(Aug 3,2023 13:31 PDT)
Kristine Lawler, City Clerk
APPROVED AS TO FORM APPROVED AS TO FORM
Joanna fin, General Counsel David J. Rapport, City Attorney
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Exhibit A
Shared Costs Between City and District for the Combined City/District Sewer System
Fiscal Year 2022-23
Budget by Activity(Collection and Treatment)
ACCOURC9 FOR.
3021 2022 2022 2022 2022 3023 PCT
IMSTUNA7RR SYSM IOIIQUEN]m ACTUAL ORIO RUD RRYI920 RDD ACTUAL PRDJRCSIOB ODONCIL CRAROR
WASTEWATER GENERAL 1,421.50 .00 (46,666.50 396,561.50 554,439.00 634,100,00 -1.0k
WASTEWATER L!OLt9CTIOQl 764,149.66 1,476,319,00 1,71l,964.41 999.121 36 902.490.31 1,121,801.00 -36.64k
MAMUNAM TAEATKENT 2,918,653.99 5,792,731.00 5,002,110.00 3,993,359 50 4,376,997.79 5,300,679.00 -9.7t
TOTAL REVH.RE .00 .00 .p0 00 _00 .DO .Ok
TOTAL REPRRSE 3,694,426.17 7,269,050.00 9,243,707.21 5,269,011.36 5,733,926JOG 7.066.290:00 -11.31
Budget by Character(Major Cost Category)
ACCO®i9 POR.
2021 3022 2033 2022 2022 2023 PCI
240 CITY SEMM OPREATIOWP PUW ACTUAL ORIO BUD REVISED BUD ACTUAL PROJRCTIOR COOM16 CIUMN
51 PERSORR9L 2,157,595.62 2,316,225.00 2,315,225 OD 1,956,544.95 2,219,563.00 2,427,494.9C 4.26
S2 OPERATIOU9 1,411,659.27 2,209,025.00 2,201,922 94 1,519„72.49 1,685,428.50 2,043,399.00 7.2%
63 APPLIRD INDIRRCT .00 .00 642,416.00 394.647,07 554,439.00 634,608.00 .1.2t
00 CAPITAL OUTL0.Y IS 170.29 2,745,000.9D 1,004,139.27 1,406,666.05 1,274,996.60 1,960,000.00 -36.41
TOTAL 940 CITY SRWER OPSRATI 3,514:429.17 7,269,050.OD 9,241,107.21 6,249,021,36 5,73l,42G.10 7,066,290.00 -14.7t
TOTAL RRZU1 .00 .00 _Op .00 .00 .00 _Ok
70M EXPENEE 3,594,425,17 7,269,050.00 8,243,707.21 5,269,011.3E 5,734,426.10 7,066,290.00 -1!_2t
Exhibit A(cont)
Shared Costs Between City and District for the Combined City/District Sewer System
Fiscal Year 2022-23
Budget by Object
ACCOMa VOR,
9021 2022 2022 2022 2022 2023 PCT
BID CITY SHIM OPERATIONS PUN ACTUAL GRID BUD RRVI9ED BUD ACTUAL PROJECTION COUNCIL CRAPDE
SI MRSMUL
61110 REGULAR SALARIES 2,260,024 81 1,366,829.90 1,165,029.00 1,119,230.11 1.292,214-00 1,420.221-00 4.Ot
91120 NON-REGULAR SAL.A .OQ .00 .00 .00 .00 .00 .Ot
51130 OVERTIME SAfA21B 60,120.79 60,000.00 50.000.00 46,002.23 54,529.00 50,000.00 .0%
51140 6TAR0-BY SALARI9 34,763.3E 32,000.00 32,000.00 30.020.02 35,632.00 32,000.00 .00
S115Q OOKPENSATKD ARS9 .00 .00 .00 .00 .00 .00 .Ot
91210 RSIIEEIENY LPERS 155,208.33 167,192.00 167,182.00 132.141.33 163,203.00 169,492.00 Be.
91211 MRS UGPWR76lI LI 265.475-71 303,456.00 303.456.00 303.456.00 303.466.00 339,045-00 11.4t
61220 INSORANTS 262,592 36 275,249.00 275,249.0O 230,637.96 264,337.00 291,654-00 6.7t
51230 WORKERS COMP 90,503.16 97,364.00 97.344.00 76,409.93 90,533-00 100.381-00 3.2%
51240 MEDICARE 20,456.37 19,497.00 19.497.00 I1,352.07 19,099-00 19.967-00 2.4t
51250 UNM PLOYKENI 14,941.53 .00 .00 1,339.06 2,701.00 .00 .Ot
51260 PICA .00 .00 .OD .00 -00 .00 .Ot
51200 OVBRTIPE/CALLWr 60 .00 .OD .00 .00 .00 .Ot
61290 CHU PNONB STIPR 4,7]9.16 4.659.00 4,658.O0 1:769.35 4,B41.00 1,319.00 -7.1"
51 PKREXUEL 2,157,695.62 2,315,225.00 2,]16,a25.0D L,956.544,96 2.219,563.00 2,427,004.00 4 9t
52 OPERATIONS
52100 CONIBACISIAL SRRV 297,113.70 396,DOO.00 373,094.60 334.446,31 329,935.00 36I,000 00 2.1%
52113 PUMING 6TOUL8S .00 15,000.00 10,000.00 .00 .00 16,000.00 50.Ot
$2114 CORPLIANCE 67SIDI 919-57 26.000.00 25,000.00 939.96 .00 25,000.00 -Ot
92120 LABOR CNARGRC PR .00 .00 .00 -00 .00 .00 .Ot
52150 LEGAL SERVICBSIE .00 10.000.00 10,00D 00 00 .00 20.000.00 .0%
ACCOUNTS POE,
2021 2022 2022 2022 2622 2022 PCT
940 CITY BBPRR OPERATIONS PUN ACTUAL ORIO BUD EMBED BUD ACTUAL PROJECTION COONCLL CAAWN
62190 SECURITY SERVICE L,096.90 1,600 00 I,S00-00 L,lll c8 L.loo 00 1-3911.00 -13.3t
52601 DATA 57ORAOS 6 C .00 .00 .00 .00 00 -00 0t
63000 IANSUIT 997TL.E 9 .00 .00 .00 BO 00 00 .0%
64100 SILPPLIRS 106,023.98 115,000.00 133,939.43 212,676.10 125,000.00 136,00o 00 .It
94101 POSTAGE 579.40 700.00 700-00 357.91 405-61 650-00 -21.4t
94102 SHALL TOOLS 22,099.99 30.000 00 30,000-00 10,646.13 20,401-00 30,000-00 4t
S410i LAB SUPPLIES 25,946.77 30,000.00 30,000.00 14.214.47 25,000.00 15,OOO.00 -SO.Ot
54161 RACEDROUND 6 P8Y 1,703.20 2,500-00 2,500.00 6CO.00 900-00 2,600-00 .0t
54120 SOP7VARE 14,802.92 33,000.00 31,451-50 14,652-50 I1,001-00 15,250.00 -51.64
MID 03KPUM AND TEC 0,402.92 32,000.00 25,000.00 9,596 43 8,995-00 12.090-00 -20.Ot
94700 PINES a PEiN.TIR .00 50,000-00 50,000 00 .00 .00 50.000.00 .Ot
65100 IWAP110N8 9.400.09 11,000.00 11,000.00 8,252-39 B,G70.00 8,796.00 -20.9%
99200 PG&E 42,616.09 35,000.09 35,000 00 41.972 33 40,aE.00 45,096.00 29,6t
66210 UTILITIES 302,967.07 317,625.00 317,625 00 200.121.49 270.297.00 206.590.00 -9.8t
55220 NASISNATEI DISPO .00 .00 .00 -00 .00 .00 0t
66210 CMT QARACIR - PA 21-60 .OD .00 .00 .00 .00 Ot
56120 RQUIPM4TT PRINTS 256,097-09 510,000.00 501,667.69 336,127-21 336,000.00 416.000,00 -17.3t
56125 LAB EQUIP-REPAIR 10,229.61 20.000.00 20,000.00 10,567,72 20,000-00 15,000.00 -2S.Ot
5613o EXTERNAL SKRVIr 61,997.17 40,000.00 SO,000.00 49,Q56.59 67,532.13 50,000.00 .Ot
L6210 FURM, S VWIM 25,971.35 SS,OOO.00 S5,000 00 29.176.96 46.000.00 60,000.00 9.1t
L6300 RUILDILTI KATNT- 27-227 99 55,000.00 56,064-57 11.091 20 29,064 S6 62.000.00 -7.2t
56410 RgaiPKEHT RENTAL 1,712,19 4,000 00 1.906 15 7,199.09 6.996.00 16,000.00 70.1%
4
Exhibit A(cunt)
Shared Costs Between City and District for the Combined City/District Sewer System
Fiscal Year 2022-23
ACCOUNTS POE:,
3021 3032 3022 2022 2022 2023 PCT
240 CITY SERER OPDRATIOMB PUN ACTUAL ORIG BUD REVISED BUD ACTUAL PROJICTIOR COUNCIL CRA1101
16504 PACILITY MAINTRN 9,192.65 20,000.00 20.000.00 12.596.50 14,000.00 20.00C.00 Srt
57100 LAMING A103 DEV 11.921.97 42,000.00 43,000-00 31.740.29 29,126.00 32,00c 00 -23 St
57300 N®I9ERSEIIPS t SO 3,197.75 9,000.00 9.000-00 1.160.01 3,000.00 3.000.00 66.7t
S4201 MATRR PURCHASES .00 .00 .00 .00 600.00 ,00 .84
6A202 CREDUCALS 151,219.04 290,000.00 290,000-00 237.047.01 243.400.00 250,000.00 .0t
99410 UARAGR L111RICANT 4,311.57 9,000.00 2,000.00 1,560 IB 3,000 00 9.000 00 bt
59510 REIMEURSAHLE.TOE .00 35,000.00 15,000.00 .00 .00 00 -Ion Ot
59100 PROPERTY TAXES P 12,245.82 14,000.00 34,000.00 7.139.10 14,000.00 14.Ooo.00 .Ot
69101 PYCY )7,661.91 42,500-00 46,104.00 10,203.46 40,026,00 4S,S00.00 _7t
69400 O791M EXPENSES .00 .00 .00 .00 -00 .00 .01
94700 PINES L PEHALTIR -00 .00 .00 .00 .00 .00 .Ot
52 OPERATIONS 2,411,659-27 2,209,925-00 2,201,929:94 1,919,172.49 1,69L,420,40 2,G43,395.00 7.2t
63 APPLIED IA7IIRELT
62205 OPERATING IIDIRR .00 .04+ 642,425.06 366,64T.47 554,111.11 631,105.Q0 -1 2t
41 APPLIED tlMIWT .00 .40 612,415.00 386,61T_17 SSd,I1i.04 63. .
01 •1.2t
00 CAPITAL OUTIAV
10100 MACHINERY 6 awl 15,170.20 2,475,000.00 2,024,132.27 1.406.666.05 1.274.996.60 1,900,0".00 32_St
10220 RUIIIIINO IMPROVR .00 15,000.00 IS,O00-00 -00 .00 .00 -100-Ot
10230 IMPPACTRUC[URE .00 255,000.00 255,000-00 .00 .00 60,000.00 -76-St
90 CAPITAL OUI'tAY I5,170 A0 2,745,000 00 3,614,139-27 1,406,666-OS 1.214,996.G0 1-960.000.0036-4t
TMAL 140 CITY SEMBR OPERATI 3,504,426.17 7,269,050.00 6,243,707-21 5,269,031.36 5,734,42(, 10 7,066,290 00 -14 31
TUM AEVVRlii06 00 .00 -00 .00 .00 .00 _01
TOTAL nPM69E 3,SR4,426.17 7,269,050.00 8.243.707.21 5,269,031.36 5,734,426.10 7,065,290.00 -14-3t
5
Exhibit B
Cost Split Between City and District
Fiscal Year 2022-23
HILDEBRAND
CONSULT-NU
Date: August 25,2022
To: Dan Buffalo,City of Ukiah
Mark DeMeulenaere,Ukiah Valley Sanitation District
wing-See Fox,Ukiah Valley Sanitation District
From: Mark Hildebrand,Hildebrand Consulting,LLC
Subject Fiscal Year2022-23 Annual ESSSU Reconciliation Memo
Hildebrand Consulting,LLC has been retained by both the City of Ukiah ("City")and Ukiah Valley
Sanitation District ("District") to provide consulting services with respect to the shared costs
between the City and the District. The City and District entered into an Operating Agreement'in
2018 which specifies how sewer collection and treatment services will be provided within the
respective service areas and how costs will be shared and distributed. The Operating Agreement
specifies a portion of shared costs is to be allocated based on each utility's proportionate share of
winter water usage and relative strength of sewage discharge to the wastewater treatment plant
(i.e.,based on the relative number of Equivalent Sewer Service Strength Units("ESSSU")). Given the
ever-changing water usage and number of customers, the relative number of ESSSUs will likely
change every year.The following describes the current number of ESSSUs for each entity in fiscal
year 2021-22 but applied to Fiscal Year 2022-23,in accordance with the Operating Agreement and
Refinancing Agreement'.
The ESSSU values were calculated based on updated utility bitting data from both parties(monthly
average of January through Marcli 2022 water usage). ESSSU values are assigned based on dwelling
units for residential customers (1 dwelling unit= 1 ESSSU) and based on water usage for non-
residential customers, Non-residential ESSSUs are calculated by dividing average monthly winter
water utiage for each account by 5.68 HCF,then multiplying by the appropriate strength factor'.
L Operating Agreement signed in 2018 for the Combined Sewer System Serving the Ukiah Valley Sanitation District and
the City of Ukiah.
2 Refinancing Agreement signed in 2020 as part of the refunding of the 2006 Wastewater Revenue Bonds for the
Combined Sewer System Serving the Ukiah Valley Sanitation District and the City of Ukiah.
'For details,see Se[tion 4.5 of the 2020 Joint Sewer Rate Study,Hildebrand Consulting.
Page 3 of 2
6
Exhibit B(cont)
Cost Split Between City and District
Fiscal Year 2022-23
Table 1 below provides a summary comparison of the clata used to calculate the previous and updated ESSSU values.The updated
percent of ESSSUs fort lie District is 50.091%and the City is 49.909%.
Table 1—Previous and Updated ESSSU Values
2021 Rate Study ESSSU Values _ 2022 Updated ESSSU Values
Dwelling ESSSUs Dwelling ESSSUs
Accounts Units Count Percent Accounts Units Count Percent
r r
Residential 2,495 4,321 4.321 34.3% Residential 2,558 4,465 4,465 32.2%
Mobile Home inat• Mobile Home (na)' {
Commercial Low Strength 249 ina) 1.116 8.9% Commercial Low Stre g _ 250 (nal 1,620 11.7%
Commercial Moderate Strength 19 (nal 290 2.3% Commerdal Moderate Stregp 19 (nal 307 2.2%
Commerdal Medium StrenlM 7 (nal 231 1.8% Commercial Medium Strength 7 _(na) 301 2.2%
_Commercial_High Strength 23 (na) 291 2 2% Commercial High 5trengch 23 (nal 249 I.8_%
Total: 2,793 4,321 6,240 49,48% Total: 2,957 4,465 6,943 $0.091%
'District classifies Mobile Homes as residential now •District classifies Mobile Homes as residential now
Residential 3,063 4,318 4,318 34.2% Residentaa 3&67 1 4 355 4,355 31.4%
Mobile Home 7 251 251 2.0% Mobile Home _ _ 7 251 251 _1.8%_
Commerdal Low Strength _ 542 Ina) 1.203 9.5% Commerdal Low Strength 522 (na) 11390 10.0%
Commercial Moderate Strength 16 (na) 142 1.1% Commercial Moderate Strength 24 ina) 185 1.3%
Commerdal Medium Strength 9 Ina) 92 p.7% Com_mcrcial Medium Strength 8 goal 97 0.7%
Commerdal High Strength 38 Ina) 363 2.9% C_ommercial High Strength 41 (na) 640 4.6%
Total: 3,675 4,569 6,370 50.52% Total: 1.669 4,606 6,918 49.909%
The ESSSU percentages are then used to update the debt allocation as clefined by the Operating Agreement. The Operating
Agreement specifies that 25.8414%of the existing debt(the"Capacity"portion)is allocated 654o to the District and 35%to the
City. The remaining 74.1586%(the"Upgrade/Rehabilitation"portion) is to be allocated based on the ESSSU split. Will)the
Updated ESSSU ratio(see Table 1),the resultant debt service allocation is 53.944%for the District and 46.056%for the City.This
results in debt true-up amount is$2,132(clue from the City to the District)in FY 2022123.
Page 2of2
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AUTHORIZED REPRESENTATIVE(S)CERTIFICATE
I, Ernie Wipf,a duly elected acting Board Chair of Ukiah Valley Sanitation District,a(n)California public
agency do hereby certify that the following has/have been appointed as(an)Authorized Represcntative(s),at
the date hereof, and are authorized to act on behalf of the above Institution in matters relating to the
Wastewater Revenue Refunding Bonds, Series 2020.
I also certify that the signatures opposite their names are the signatures of such individuals.
Name(First, middle Title(list multiple Contact Information Specimen Signature
as applicable], last) titles if applicable
(650)906-8959
Wing-See Fox General Manager
wingscef@urbanfuturesinc.com
Insert Phone Number
Insert Name Insert Title
Insert E-mail Address
Insert Phone Number
Insert Name Insert Title
Insert E-mail Address
Insert Phone Number
Insert Name Insert Title
Insert E-mail Address
Witness my signature on this 28th day of June,2023.
(Signature of Aut orizita rcial)
(Note: If there are multiple individuals identified as Authorized Representatives,one of those same
individuals may execute the form as the"Authorizing Official". If there is a single individual named
as an Authorized Representative,the "Authorizing Official" must be an individual that is not the
named Authorized Representative.)
U.S.Bank Confidentiat F20#3-I E'arc I ni I
