1. A big lift is required: The Budget Committee, made up of 5 Board members and 5 community members, has spent the past several months exploring ways to pay for the extensive maintenance / repairs/ and upgrades that are required for the operational and administrative systems.  To make ends meet, excess usage fees will be increased by 125% and rates by 3.7%.  Sadly it is a big jump?  And even with these increases, the District will be running with little financial margin for error. <Click here to see the Budget including line-item project detail>

2 . The bright spot – monies reimbursed:  Going back into the 2017-2022 financial records, it was discovered that $139,622 of rate-payer monies was spent from the water utility operating fund on activities and costs related to the purchase and operations of the forest-watershed. <click here to see forest-watershed costs>

• Contractor costs and related expenditures: $ 78,310   
• Staff costs: $ 61,312

Even though over $280,000 of forest-watershed contributions was being donated to the District during that time, those contributions were not being used to pay for the forest-watershed costs.  

The District’s lawyer has confirmed that any/all of the $280,000 of donations can be used to reimburse the District’s operating fund for the 2017-2022 forest-watershed related costs since the District had defined the purpose of those donations as “in support of the future Arch Cape Forest”, with no other limitations or constrictions.  <click here to see donation receipt letter from the District specifying the purpose of the donation.>

The District’s accountant has confirmed that, in next year’s budget, it is appropriate for the Board to transfer $139,622 from the forest fund to the operating fund to cover these documented costs. 

Transferring this money to the operating fund gives the District some needed financial padding for any emergencies that may present themselves next year and, if the money is not needed, future rates and excess usage fee increases that had been projected at 5%  per can be reduced to 3.5% per year.

3. A tough slog:  This budget process has been hard work.  From an emotional perspective, it has been discouraging to correct a $41,000+ long-term personnel policy error that drains this year’s financial reserves, to take a realistic look at the state of the Districts’ systems and see the shape that they are in, to figure out what needs to be done to fix them and then to make budget decisions that will increase the financial burden on all of us rate-payer for the next handful of years.   The financial decisions that have been made this year are mindful and heartfelt.

1. Staffing: Since at least 2009, the combined staffing for the Water and Sanitary Districts has been constant at 2 full time operations staff and a part time contracted book keeper.   This staffing level holds true today even though the plants have aged, state and federal mandates continue to increase project and operational workload and the District has acquired a Forest-Watershed.   We are getting a sense that there is a serious misalignment between the work that is required and the staffing necessary to do it.  During the past year, well over 40 hours / week of Board member time (from Water and Sanitary Boards) has been required to fill in all the gaps (chasms).  This level of Board member involvement is untenable as it is unlikely that any future Board(s) will have the expertise and appetite for a time commitment of this magnitude.  It seems clear that some level of additional staff will be required on an ongoing basis – which will have additional financial impact on rate payers.   The Board is exploring ways to evaluate the true level and type of staffing that is required.  More about this to come in the next several months.

2. Paying for future Forest-Watershed Costs: The good news is that the transfer of $139,622 from the forest fund brought some financial stability to the water utility side of the business.  However, it is a significant depletion of the cash position of the Forest fund.  Without a huge influx of donations, the  District will run out of money to operate the Forest-Watershed in 2031.  To pay for those future costs, the most viable options are most likely to be either taxes or logging or a combination.  During this next year, the Board will put forward a specific proposal for involving the community in making the decision of which option(s) to pursue.