Agenda Board of Directors Regular Board Meeting Wednesday, March 7, 2018 – 3:30 Pm 9300 Fanita Parkway, Santee, Ca 92071

AGENDA BOARD OF DIRECTORS REGULAR BOARD MEETING WEDNESDAY, MARCH 7, 2018 – 3:30 PM 9300 FANITA PARKWAY, SANTEE, CA 92071

● CALL TO ORDER

● PLEDGE OF ALLEGIANCE

● PRESENTATION Recognizing Daniel Humphrey, Electrician/Instrumental and Controls Technician for 10 years of District Service.

● OPPORTUNITY FOR PUBLIC COMMENT Opportunity for members of the public to address the Board (Gov. Code 54954.3)

● APPROVAL OF MINUTES Recommendation: Approve the minutes of the Regular Board Meeting of February 7, 2018.

● ITEMS TO BE ADDED, WITHDRAWN OR REORDERED ON THE AGENDA

● CONSENT AGENDA Items are considered to be routine and will be acted upon by a single motion without discussion, unless a Board Member, staff, or the public request a specific item be removed from the consent agenda for discussion.

1. LABORATORY/WRF IMPROVEMENTS Recommendation: Authorize expenditures not to exceed $192,190 (includes labor and 10% contingency) for the rehabilitation of the Water Recycling Facility Laboratory, office areas and SCADA control room.

[March 7, 2018] Page 1 of 4 [Agenda] ● ACTION AGENDA Items on the Action Agenda call for discussion and action by the Board. All items are placed on the Agenda so that the Board may discuss and take action on the item if the Board is so inclined.

2. AWARD OF CONSTRUCTION CONTRACT FOR VIEJAS MOUNTAIN RESERVOIRS REFURBISHMENT PROJECT (JN 217019) Recommendation: Award the construction contract for the Viejas Mountain Reservoirs Refurbishment Project (JN 217019) to the lowest responsive bidder, West Coast Industrial Coatings, Inc., at a not to exceed cost of $480,452 and authorize the General Manager, or his designee, to modify the contract amount up to 10% ($48,045) for unforeseen construction changes.

3. LEGISLATIVE UPDATE Recommendation: Hear staff report; no action needed.

4. CONSIDER FINANCIAL CONTRIBUTION TO ACWA'S "NO DRINKING WATER TAX EDUCATION AND OUTREACH CAMPAIGN" Recommendation: 1. Hear staff report on the status of Water tax legislation in California. 2. Approve $10,000 financial contribution, or Board determined amount, to ACWA's "No Drinking Water Tax Education and Outreach Campaign."

5. SEMI-ANNUAL REPORT ON THE FIVE YEAR BUSINESS PLAN, FOR THE SIX MONTHS ENDED 12/31/17 Recommendation: Hear a report on the financial highlights for the first half of FY ’18.

● REPORTS The following items are reports and are placed on the Agenda to provide information to the Board and the public. There is no action called for on these items. The Board may engage in discussion upon which a specific subject matter is identified but may not take any action other than to place the matter on a future agenda.

6. BOARD REPORTS

A. County Water Authority (CWA) Board of Directors Meeting B. Santee Chamber of Commerce Governmental Affairs Committee Meeting C. Metro Commission/Metro Wastewater JPA D. Other meetings/conferences/events attended by Directors per AB1234 (Council of Water Utilities, CSDA San Diego Chapter, etc.)

● DIRECTORS COMMENTS Directors’ comments are to be related to District business which may be of interest to the Board. They are placed on the agenda to enable individual Board Members to convey information to the Board and the Public. There is to be no discussion or action taken on comments made by Board Members.

[March 7, 2018] Page 2 of 4 [Agenda]

7. DISTRICT COUNSEL'S REPORT

8. GENERAL MANAGER'S REPORT

9. INFORMATIONAL REPORTS

A. Finance and Treasurer's Report for the seven months ended January 31, 2018

● CLOSED SESSION At any time during the regular session, the Board may adjourn to closed session to consider litigation, or discuss with Legal Counsel matters within the attorney-client privilege, subject to the appropriate disclosures.

● ADJOURNMENT

NOTICE TO THE PUBLIC This agenda was posted at least 72 hours before the meeting in a location freely accessible to the public. No action may be taken on any item not appearing on the posted agenda, except as provided by Gov. Code Section 54954.2. The complete agenda package is available for public review on the District’s website, www.PadreDam.org. Any written materials provided to a majority of the Board of Directors within 72 hours prior to the meeting regarding any item on this agenda will be available for public inspection at the District’s Customer Service Center located at 9300 Fanita Parkway. For questions or request for information related to this agenda contact Amy Pederson, Board Secretary, at 619.258.4614 or [email protected].

Upon request, this agenda will be made available in appropriate alternative formats to persons with disabilities, as required by Section 202 of the American with Disabilities Act of 1990. Any person with a disability who requires a modification or accommodation in order to participate in a meeting should contact our ADA Coordinator: Larry Costello at 619.258.4678 or [email protected]

PUBLIC COMMENT PROCEDURES Members of the public may address the Board regarding items not appearing on the posted agenda, which are within the subject matter jurisdiction of the Board. Speakers are requested to state name, address and topic, and observe a time limit of 3 minutes each. Public comment on a single topic is limited to a total of 15 minutes. Anyone desiring to address the Board regarding an item listed on the agenda should fill out a “request to speak” form and provide it to the Board Secretary. These forms are available in the Board Room on the counter near the entrance doors.

NEXT RESOLUTION NO. 2018-07 NEXT ORDINANCE NO. 2018-01

[March 7, 2018] Page 3 of 4 [Agenda] CERTIFICATION OF POSTING

I certify that on March 2, 2018, I posted a copy of the foregoing agenda near the regular meeting place of the Board of Directors of Padre Dam Municipal Water District, said time being at least 72 hours prior to the meeting, in accordance with Gov. Code Section 54954.2(a).

______Amy Pederson, Board Secretary

[March 7, 2018] Page 4 of 4 [Agenda] March 2018 April 2018 Su Mo Tu We Th Fr Sa Su Mo Tu We Th Fr Sa March 2018 123 1234567 45678910 8 9 10 11 12 13 14 11 12 13 14 15 16 17 15 16 17 18 19 20 21 18 19 20 21 22 23 24 22 23 24 25 26 27 28 25 26 27 28 29 30 31 29 30

Sunday Monday Tuesday Wednesday Thursday Friday Saturday Feb 25 26 27 28 Mar 1 2 3 12:00pm 1:00pm Metro Commission/JPA Feb 25 - Mar 3

4 5 6 7 8 9 10 3:30pm 6:00pm Board 1:30pm 5:00pm CWA Meeting Special Board Meeting (if needed) Mar 4 - 10 4 - Mar

11 12 13 14 15 16 17 9:00am 10:00am Basin 7:45am 8:45am Santee Meeting Chamber Board Mtg Mar 11 - 17 Mar

18 19 20 21 22 23 24 8:30am 10:00am 7:30am 9:00am COWU 7:30am 8:30am East 9:00am 5:00pm CWA Chamber County Economic Board Mtg Governmental Affairs Development Counci Committee 3:30pm 6:00pm Board Meeting Mar 18 - 24 Mar

25 26 27 28 29 30 31 3:30pm 5:00pm Park 2:00pm 4:00pm Committee Facilities Dev. & Ops Committee Mar 25 - 31 Mar

Agenda 1 2/28/2018 9:35 AM April 2018 May 2018 Su Mo Tu We Th Fr Sa Su Mo Tu We Th Fr Sa April 2018 1234567 12345 8 9 10 11 12 13 14 6789101112 15 16 17 18 19 20 21 13 14 15 16 17 18 19 22 23 24 25 26 27 28 20 21 22 23 24 25 26 29 30 27 28 29 30 31

Sunday Monday Tuesday Wednesday Thursday Friday Saturday Apr 1 2 3 4 5 6 7 3:30pm 6:00pm Board 12:00pm 1:00pm Metro Meeting Commission/JPA Apr 1 - 7

8 9 10 11 12 13 14 1:30pm 5:00pm CWA Special Board Meeting (if needed) Apr 8 - 14

15 16 17 18 19 20 21 8:30am 10:00am 7:30am 9:00am COWU 7:30am 8:30am East 7:45am 8:45am Santee Chamber County Economic Chamber Board Mtg Governmental Affairs Development Counci Committee 3:30pm 6:00pm Board Meeting Apr 15 - 21

22 23 24 25 26 27 28 1:30pm 3:00pm 3:30pm 5:00pm Park 9:00am 5:00pm CWA Security Committee Committee Board Mtg Apr 22 - 28

29 30 May 1 2 3 4 5 Apr 29 - May 5

Agenda 2 2/28/2018 9:35 AM May 2018 June 2018 Su Mo Tu We Th Fr Sa Su Mo Tu We Th Fr Sa May 2018 12345 12 6789101112 3456789 13 14 15 16 17 18 19 10 11 12 13 14 15 16 20 21 22 23 24 25 26 17 18 19 20 21 22 23 27 28 29 30 31 24 25 26 27 28 29 30

Sunday Monday Tuesday Wednesday Thursday Friday Saturday Apr 29 30 May 1 2 3 4 5 3:30pm 6:00pm Board 12:00pm 1:00pm Metro Meeting Commission/JPA Apr 29 - May 5

6 7 8 9 10 11 12 9:00am 10:00am Basin 1:30pm 5:00pm CWA Meeting Special Board Meeting (if needed) May 6 - 12 May

13 14 15 16 17 18 19 7:30am 9:00am COWU 7:30am 8:30am East 7:45am 8:45am Santee 9:30am 11:00am LAFCO County Economic Chamber Board Mtg Advisory Development Counci Committee Meeting 6:00pm 9:00pm 3:30pm 6:00pm Board CSDA Quarterly Meeting

May 13 - 19 13 May Meeting

20 21 22 23 24 25 26 8:30am 10:00am 3:30pm 5:00pm Park 9:00am 5:00pm CWA Chamber Committee Board Mtg Governmental Affairs Committee May 20 - 26 20 May

27 28 29 30 31 Jun 1 2 Office Closed 1:30pm 3:30pm Memorial Day Facilities Dev. & Ops Committee May 27 - Jun 2 May

Agenda 3 2/28/2018 9:35 AM June 2018 July 2018 Su Mo Tu We Th Fr Sa Su Mo Tu We Th Fr Sa June 2018 12 1234567 3456789 8 9 10 11 12 13 14 10 11 12 13 14 15 16 15 16 17 18 19 20 21 17 18 19 20 21 22 23 22 23 24 25 26 27 28 24 25 26 27 28 29 30 29 30 31

Sunday Monday Tuesday Wednesday Thursday Friday Saturday May 27 28 29 30 31 Jun 1 2 May 27 - Jun 2 May

3 4 5 6 7 8 9 3:30pm 6:00pm Board 12:00pm 1:00pm Metro Meeting Commission/JPA Jun 3 - 9

10 11 12 13 14 15 16 1:30pm 5:00pm CWA Special Board Meeting (if needed) Jun 10 - 16

17 18 19 20 21 22 23 8:30am 10:00am 7:30am 9:00am COWU 7:30am 8:30am East 7:45am 8:45am Santee Chamber County Economic Chamber Board Mtg Governmental Affairs Development Counci Committee 3:30pm 6:00pm Board Meeting Jun 17 - 23

24 25 26 27 28 29 30 1:30pm 3:30pm Finance 3:30pm 5:00pm Park 9:00am 5:00pm CWA & Admin Committee Committee Board Mtg Jun 24 - 30

Agenda 4 2/28/2018 9:35 AM MINUTES OF THE REGULAR MEETING OF THE BOARD OF DIRECTORS OF PADRE DAM MUNICIPAL WATER DISTRICT HELD ON WEDNESDAY, FEBRUARY 7, 2018

The regular meeting of the Board of Directors of Padre Dam Municipal Water District was held on Wednesday, February 7, 2018, at the appointed meeting place, the Board Room at the District’s Customer Service Center, located at 9300 Fanita Parkway, Santee, California.

President Pommering called the meeting to order at 3:30pm. A quorum was declared, and the following Directors were present: Caires, Peasley, Pommering, Scalzitti and Wilson.

Directors absent: None

Staff members present: Allen Carlisle, CEO/General Manager; Al Lau, Director of Engineering & Planning; Karen Jassoy, CFO/Director of Finance; Lisa Sorce, Director of Human Resources; Paul Clarke, Director of Operations & Water Quality; Laura Koval, Director of Park & Recreation; Amy Pederson, Board Secretary; Paula de Sousa Mills, District Counsel; Melissa McChesney, Communications Officer; Bryan Hague, Park Operations Manager; Larry Castello, Safety & Risk Manager; Jimmy Vargas, Distribution Maintenance Supervisor; and Daniel Stevenson, Systems Operator

PRESENTATION

Jimmy Vargas, Distribution Maintenance Supervisor, recognized Daniel Stevenson, Systems Operator, for 10 years of District Service and presented a framed resolution memorializing his contributions to the District.

The Board congratulated and thanked Mr. Stevenson for his service.

OPPORTUNITY FOR PUBLIC COMMENT

There were no public comments.

APPROVAL OF MINUTES

On motion of Director Scalzitti, seconded by Director Peasley, and unanimously carried, the minutes of the Regular Board Meetings of January 10, 2018 and January 17, 2018 were approved as submitted.

ITEMS TO BE ADDED, WITHDRAWN, OR REORDERED ON THE AGENDA

There were no items to be added, withdrawn, or reordered at this time.

On motion of Director Scalzitti, seconded by Director Wilson, and unanimously carried, the Board approved items 1 through 4 as submitted below.

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1. GENERAL MANAGER’S EXPENSE CLAIM The Board approved claim and authorized payment.

2. AUTHORIZATION FOR PER DIEM AND EXPENSE REIMBURSEMENT FOR THE CALIFORNIA WATER POLICY CONFERENCE AT THE UC DAVIS CONFERENCE CENTER The Board authorized per diem and expense reimbursement for Board Members to attend the California Water Policy Conference at the UC Davis Conference Center on March 22 & 23, 2018.

3. LEGAL SERVICES AGREEMENT WITH BEST BEST & KRIEGER LLP TO INCLUDE REVISED LEGAL SERVICES RATE STRUCTURE The Board approved the new Agreement for General Counsel Legal Services between Padre Dam and Best Best & Krieger LLP as recommended by the Finance & Administrative Services Committee.

4. LANDSCAPE SERVICES AGREEMENT FOR SANTEE LAKES RECREATION PRESERVE AND DISTRICT WIDE FACILITIES The Board approved the replacement Landscape Services Agreement for Santee Lakes Recreation Preserve and District Wide Facilities upon termination of existing Service Agreements.

● ACTION AGENDA Items on the Action Agenda call for discussion and action by the Board. All items are placed on the Agenda so that the Board may discuss and take action on the item if the Board is so inclined.

5. RESOLUTION ADOPTING MULTI-JURISDICTIONAL HAZARD MITIGATION PLAN (MJHMP) Larry Costello, Safety & Risk Manager, explained what a Multi-Jurisdictional Hazard Mitigation Plan is and the benefits to adopting the plan including grant funding. He reviewed the history of the District’s past mitigation plans and explained FEMA’s requirements for the current plan which have been met and approved by FEMA.

On motion of Director Caires, seconded by Director Wilson, and unanimously carried, the Board adopted Resolution 2018-05 approving the District’s portion of the San Diego County Multi- Jurisdictional Hazard Mitigation Plan.

6. SEMI-ANNUAL REPORT ON STRATEGIC PLAN Melissa McChesney, Communications Officer, kicked off the presentation by reviewing the six goals of the Strategic Plan and reported the Goal Scorecards attached in the agenda include the status of all initiatives and are made available to the public on the District’s website.

Staff Champions from each category highlighted accomplishments for two initiatives from each goal over the past six months.

Paul Clarke, Director of Operations and Water Quality, reported on accomplishments for initiative 1.3 - Infrastructure Security, which included enhanced security measures at remote sites. He also summarized accomplishments for Initiative 1.1 – Maintain and Renew Assets, noting that the Valve Replacement Program is ahead of goal.

[February 7, 2018] Page 2 of 5 [Minutes] -6- Karen Jassoy, CFO/Director of Finance, reported on accomplishments for Initiative 2.4 - Conduct Long Range Planning to Ensure Adequate and Reliable Revenue Stream. She explained the suggestions from the Cost of Service Study have been implemented, shifts towards higher fixed costs provide greater revenue reliability and the District is meeting conservative sales projections. In closing, Ms. Jassoy summarized future goals.

Melissa McChesney, Communications Officer, reported on accomplishments for Initiative 3.2 - Educate Customers on Water Issues and Water Usage, highlighting implementation of the customer education program. This program includes profiles of Padre Dam staff, District tours, the Eastern Service Area Secondary Connection Project video and the District’s outreach to customers using social media.

Al Lau, Director of Engineering, summarized accomplishments for Initiative 4.4 - Support Regional Water Supply Reliability. Mr. Lau stated the District is working with the County of San Diego on evaluating the feasibility of diverting storm water to the water recycling facility. Additionally, the District is developing a water service agreement to provide water to Sycuan.

Mr. Lau also reported on Initiative 4.3 - Increase Use of Sustainable Energy Sources and Optimize Energy Efficiencies, highlighting steps taken to develop bio-fuel opportunities.

Lisa Sorce, Director of Human Resources, reported on Initiative 5.1 - Develop and Train Our Future Leaders, highlighting educational opportunities offered to staff and the implementation of the District’s wellness program encouraging employee wellness.

Laura Koval, Director of Parks and Recreation, reported on Initiative 6.4.4 - Utilize Customer Survey to Gather Data on Ideas of Enhanced/Improved Programs and Service. She explained there was an issue with the reservation software and exit survey but the issue has been resolved.

Ms. Koval also reported on 6.3.2 - Promote Santee Lakes Foundation Awareness and Increase Funding, highlighting the new dog park available to campers.

Lastly, Ms. Koval reported on 6.1.2 Process with Capital Improvements based on Dynamic Vision Plan, highlighting the various enhancements completed at Santee Lakes.

Informational report only; no action was taken.

7. CONSIDER APPOINTMENT TO THE SAN DIEGO COUNTY CONSOLIDATED REDEVELOPMENT OVERSIGHT BOARD CHARGED WITH OVERSEEING THE CONSOLIDATION OF 17 SUCCESSOR REDEVELOPMENT AGENCIES IN SAN DIEGO COUNTY Paula de Sousa Mills, Legal Counsel, provided the history on the consolidation of redevelopment agencies which began in 2012 and summarized the latest legislation that passed which requires the consolidation of the Successor Agencies into one Countywide Successor Agency.

Ms. de Sousa Mills summarized the role of the new Consolidated Redevelopment Oversight Board and the role of the nominee elected to the Board. In closing, she explained it’s at the discretion of the Board to submit a nomination.

On motion of Director Caires, seconded by Director Peasley, and unanimously carried, the Board nominated Director Pommering as the Special District Representative to the Consolidated

[February 7, 2018] Page 3 of 5 [Minutes] -7- Redevelopment Oversight Board and authorized the Board Secretary to submit the nomination on the Board’s behalf.

8. BOARD REPORTS

A. County Water Authority (CWA) Board of Directors Meeting Director Wilson reported an expected increase of water received through the Quantification Settlement Agreement (QSA) from Imperial Valley and the cost and profit of the transfer of water; he summarized updates he received regarding the water tax issues; and shared what he learned from the Colorado River Board tour he attended.

B. Santee Chamber of Commerce Board Meeting Director Peasley reported the Chamber held their annual planning meeting to discuss the future annual efforts and a budget was approved; new members of the Board were present. Additionally, the Chamber has found a new location to meet.

C. Santee Chamber of Commerce Governmental Affairs Committee Meeting Director Pommering reported on the January 22 meeting in which the state reported a $6 billion surplus but are still increasing taxes; Prop 98 will increase funding for schools; SB 328 requires that school not start until 8:30am; SB 30 proposes that no state contracts will be awarded to anyone working on the wall; Assembly Member Voepel is part of a proposal to not count employer payoff of student loans as income; the City of Santee reported on projects moving forward.

D. Other meetings/conferences/events attended by Directors per AB1234 (Council of Water Utilities, CSDA San Diego Chapter, etc.) None

Director Wilson mentioned Aqua Hawk, the District’s water use alert system, is working well; he’s been working on his landscape and has been notified by Aqua Hawk daily that he’s exceeded the limit of water use he programmed for his personal alert notifications.

Director Caires commented on the flu epidemic in San Diego County.

Director Peasley reported on the initiation of the Ad hoc AWP Board Committee and will give further updates at a future meeting.

[February 7, 2018] Page 4 of 5 [Minutes] -8-

Director Pommering requested staff provide a monthly update on the drought report. He asked for an update on the request for a dedication of the clock tower in which the General Manager responded it is part of his General Manager’s report.

9. DISTRICT COUNSEL'S REPORT Ms. de Sousa Mills summarized a bill previously passed that stated every human has a right to water; after the bill was passed a daily journal article described the bill’s intent based on the author. Assembly Member Dodd, along with the SWRCB, for the past year have explored how they could fix the prior legislation, which as a result, is now in the legislature as SB 998 related to water shutoffs.

Melissa McChesney summarized the requirements of SB 998 and impacts to the District if approved. She and Legal Counsel addressed follow up questions from the Board.

SB 623 (Monning) has been put into a budget trailer bill which means it could move much quicker. ACWA is working to develop an Outreach Campaign and will be asking agencies to participate in funding the campaign.

10. GENERAL MANAGER'S REPORT Mr. Carlisle deferred to Ms. McChesney who reported she was informed by Verizon that they do not conduct dedications and explained why they would prefer not to. She shared outreach methods the District has done to inform the public that the clock tower is owned and operated by Verizon. She stated customers have been providing positive feedback.

Director Peasley suggested possibly placing a sign near the clock tower with this information.

11. INFORMATIONAL REPORTS The following reports were noted and filed.

A. Finance and Treasurer's Report for the six months ended December 31, 2017 B. Park Committee/Special Board Meeting Minutes of November 7, 2017; December 5, 2017 and January 24, 2018. C. Finance & Administrative Services Committee/Special Board Meeting Minutes of December 11, 2017 D. Facilities Development & Operations Committee/Special Board Meeting Minutes of November 27, 2017

● ADJOURNMENT President Pommering declared the meeting adjourned at 5:00pm.

______ATTEST: Board President

______Board Secretary

[February 7, 2018] Page 5 of 5 [Minutes] -9-

Meeting Date: 3/7/2018 Dept. Head: Paul Clarke Submitted by: Paul Clarke BOARD AGENDA REPORT Department: Operations

Approved by: Allen Carlisle, GM

SUBJECT: LABORATORY/WRF IMPROVEMENTS

RECOMMENDATION(S):

Authorize expenditures not to exceed $192,190 (includes labor and 10% contingency) for the rehabilitation of the Water Recycling Facility Laboratory, office areas and SCADA control room.

ALTERNATIVE(S):

1. Do not approve.

ATTACHMENT(S):

None

FUNDING:

Requested amount: $192,190 (includes $65,700 labor cost and 10% contingency of $17,472) Budgeted amount: $200,000 Are funds available? Yes No Project cost to date: None

PRIOR BOARD/COMMITTEE CONSIDERATION: Budget for this project is located within cost centers 51, 52 and 61 with the line items outlined in the Five Year Business Plan and Budget and will not exceed a cost of $192,190.

STRATEGIC PLAN IMPLEMENTATION:

This agenda item is consistent with the District’s Strategic Plan & meets one or more of the following Strategic Goals: Provide safe, reliable water, recycled water and sewer services; Ensure fiscal health and competitively sustainable rates; Enhance customer communications and education; Increase water, wastewater and energy independence; Maintain workforce excellence; Expand park and recreation opportunities.

Reviewed by: Action Required: Policy Updates: Action Taken: Dept Head Motion As Recommended ______Rules & Regulations Finance Resolution Reso/Ord. No. ______Legal Ordinance Standard Practices Other ______Standard Form None & Policies

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EXECUTIVE SUMMARY:

Staff is proposing a rehabilitation of the Water Recycling Facility (WRF) Laboratory, WRF SCADA Control room and the Plant Manager’s office. This includes replacement of flooring, cabinets, lighting upgrades, paint and the addition of a conference room among other items. Facilities Maintenance staff will be conducting a majority of the work in house and will contract out some specialty tasks.

DESCRIPTION:

The Lab and office areas have aged and deteriorated to a condition that is in need for updating to make these areas more efficient and safe. Facilities Maintenance staff will be conducting the majority of the work in-house, however they will hire contractors to conduct some of the work where and when it is more efficient to do so. The in-house work consists of all demolition work, tile and carpet installation, addition of walls and doors, audio/video systems installation, hardware installation and all finish work. The contracted work includes lighting, fire sprinklers, casework, ceiling tiles and painting. Contract work is expected to cost $49,168. Facilities Maintenance Technician will be acting as the project coordinator and will be purchasing approximately $60,000 in materials and supplies and has budgeted $65,700 for internal labor. Total project cost is estimated at $174,718. A 10% contingency ($17,472) has been added to cover any unforeseen issues with the building. Budget for this project is located within cost centers 51, 52 and 61 with the line items outlined in the Five Year Plan and Budget and will not exceed a cost of $192,190.

As noted in the table below, each contracted item will be below the $35,000 State contract limit and does not require formal public bidding. All contracted work will be bid in accordance with the District’s purchasing policy. The table below shows staff labor costs, materials costs and each item that will be contracted.

Staff will be performing the majority of the work while contracting out the portions that require special tools or trades. We believe this method will allow us to complete the project in a more cost effective manner and will result in a savings to the District when compared to outsourcing the entire project.

Staff has taken the future Plant expansion into consideration during the design process. All work/upgrades will be utilized with or without the Plant expansion.

Page 2 of 3 -12-

RECOMMENDATION(S):

Authorize expenditures not to exceed $192,190 (includes labor and 10% contingency) for the rehabilitation of the Water Recycling Facility Laboratory, office areas and SCADA control room.

Page 3 of 3 -13-

Meeting Date: 3/7/2018 Dept. Head: Al Lau, P.E. Submitted by: Seval Sen, P.E. BOARD AGENDA REPORT Department: Engineering Approved by: Allen Carlisle, GM

SUBJECT: AWARD OF CONSTRUCTION CONTRACT FOR VIEJAS MOUNTAIN RESERVOIRS REFURBISHMENT PROJECT (JN 217019)

RECOMMENDATION(S):

Award the construction contract for the Viejas Mountain Reservoirs Refurbishment Project (JN 217019) to the lowest responsive bidder, West Coast Industrial Coatings, Inc., at a not to exceed cost of $480,452 and authorize the General Manager, or his designee, to modify the contract amount up to 10% ($48,045) for unforeseen construction changes.

ALTERNATIVE(S):

1. Reject all bids and do not award the construction contract at this time. 2. Reject all bids and re-advertise the Project for bid.

ATTACHMENT(S):

None

FUNDING:

Requested amount: $528,497 Budgeted amount: $583,000 Are funds available? Yes No Project cost to date: $45,000

PRIOR BOARD/COMMITTEE CONSIDERATION:

STRATEGIC PLAN IMPLEMENTATION:

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EXECUTIVE SUMMARY:

The Fiscal Year 2018/2019 CIP budget includes funding for the coating and refurbishment of the two potable water reservoirs at the Viejas Mountain site (Project). The Project includes field re-coating the interior and exterior of the reservoirs. The work also includes minor refurbishment to the cathodic protection system and vents.

Project plans and specifications were advertised for bid in accordance with the District’s Policies and Procedures. A total of four bids were received. Staff recommends award of the construction contract to West Coast Industrial Coatings, Inc.

DESCRIPTION:

The Fiscal Year 2018/2019 CIP budget includes funding for the Viejas Mountain Reservoirs Refurbishment Project (JN 217019).

There are two potable water reservoirs at the Viejas Mountain site: the 0.25 MG capacity Reservoir #6 and the 0.7 MG capacity Reservoir #7. Reservoir #6 was originally built in 1962 and refurbished and received internal and external coating in 2001. Reservoir #7 was originally built in 1999. Coatings at both tanks are now approximately 17 years old reaching their expected useful life. Both reservoirs are scheduled for receiving internal and external coatings along with minor refurbishment to appurtenances.

District staff developed project plans and specifications for the reservoirs re-coating and refurbishment through a collaborative effort with Operations staff. In general, work to be performed at each reservoir includes, but not limited to, the following:

Viejas Mountain Reservoir #6 • Remove and dispose the existing internal and external coating system. Apply a new internal and external coating system to all internal exposed surfaces. • Replace cathodic protection anode and electrode wires and hardware. • Refurbish existing center vent, perimeter vents, and existing cathodic protection access ports.

Viejas Mountain Reservoir #7 • Remove and dispose the existing internal and external coating system. Apply a new internal and external coating system to all internal exposed surfaces. • Replace cathodic protection anode and electrode wires and hardware. • Refurbish existing vents and cathodic protection access ports. • Remove two 12-inch check valves and a portion of the 12-inch internal piping and supports, and install a 12-inch blind flange.

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Bid Results

The bid opening for construction of the Project was held on February 7, 2018 at 10:30 am with the following results:

Bidder Base Bid Alternate Bid Total Bid Amount

West Coast Industrial Coatings, Inc. $ 341,759 $ 138,693 $480,452 Simpson Sandblasting and Special Coatings $ 377,581 $ 182,470 $560,051 J. Colon Coatings $ 386,750 $ 197,900 $584,650

Olympos Painting, Inc. $ 647,850 $ 292,950 $940,800 Notes: 1) The determination of the lowest responsive bidder is based on the Total Bid Price. 2) The engineer’s construction cost estimate was $390,000 for Base Bid, $200,000 for Alternate Bid, and $590,000 for Total Bid Items

Due to budget considerations staff divided the contract into two major bid items. The base bid focused on the internal and external coating and refurbishment at Reservoir #6 and external coating and refurbishment at Reservoir #7. The Alternate bid item focused on the internal coating at Reservoir #7. This bidding approach provides the District the flexibility to award a portion or all of the work while ensuring the work completed (base bid) meets the priority operational objectives.

The lowest responsible bidder submitting a responsive bid is West Coast Industrial Coatings, Inc. Considering the very competitive bid proposal from West Coast and the safety and operational risk of delaying internal coating of the Reservoir #7, Staff is recommending to award both the base bid and the alternate bids items and award the contract for the Viejas Mountain Reservoirs Refurbishment Project to West Coast Industrial Coatings, Inc. Staff reviewed the bid proposal to ensure it was in compliance with contract requirements. Additionally, staff checked references and received favorable feedbacks.

District staff will perform the construction management and inspection activities for this Project. The anticipated effort for these services is approximately $25,000.

RECOMMENDATION(S):

Page 3 of 3 -17-

Meeting Date: 3/7/2018 Dept. Head: Allen Carlisle Submitted by: Melissa McChesney Department: Administration BOARD AGENDA REPORT Approved by: Allen Carlisle, GM

SUBJECT: LEGISLATIVE UPDATE

RECOMMENDATION(S):

Hear staff report; no action needed.

ALTERNATIVE(S):

N/A

ATTACHMENT(S):

None

FUNDING:

Requested amount: N/A Budgeted amount: Are funds available? Yes No Project cost to date:

PRIOR BOARD/COMMITTEE CONSIDERATION:

STRATEGIC PLAN IMPLEMENTATION:

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EXECUTIVE SUMMARY:

Water continues to be a hot topic at the State Legislature. The top three issues we are currently following are the Water Tax proposed in the Governor’s Budget Trailer Bill, Long Term Conservation Bills and Water Shut-off legislation.

DESCRIPTION:

Drinking Water Tax The Governor’s office released proposed budget trailer bill language on February 1, 2018 which closely mirrors the provisions of SB 623 (Monning) and would impose a water tax to generate funds for groundwater contamination cleanup within disadvantaged communities.

SB 623 (Monning) is a two-year bill with the same objectives.

SB 623 and the Budget Trailer bill would impose a fertilizer tax, a dairy tax and a water tax on ratepayers of retail water suppliers as follows:

 A charge of $0.95 per month per account for customers with a water meter of one inch or less$4/month for customers with meter sizes greater than one inch and less than or equal to 2 inches  $6/month for customers with meter sizes greater than 2 inches and less than or equal to 4 inches  $10/month for customers with meter sizes greater than 4 inches

These amounts would be subject to increasing in the future.

As structured, SB 623 would raise approximately $160 million of annual revenue in the following manner: o Water tax = $135.4 million/year – 85% of revenue o Fertilizer tax = $16.8 million/year – 11% of revenue o Dairy tax = $5.7 million/year – 4% of revenue

The District currently opposes SB 623 and the Budget Trailer Bill.

AB 2050 (Caballero) AB 2050 is co-sponsored by Eastern Municipal Water District and the California Municipal Utilities Association and is being presented as an alternative to a water tax solution. This bill would establish a governance and service delivery framework for providing safe drinking water within disadvantaged communities. There are discussions that this bill is going to include consolidations.

The District currently is tracking this bill and doesn’t have a position.

Long Term Conservation AB 1668 (Friedman) and SB 606 (Hertzberg) are continuing from last year as two-year bills. There are implementation issues and concerns with several key items in the bill including variances, CII practices, reporting requirements and potable reuse credit. Padre Dam is most concerned with the potable reuse credit. The District is working with other agencies in San Diego and Orange County to encourage a 30

Page 2 of 3 -20- percent credit for potable reuse water be added to this legislation. This would give full credit for our future Advanced Water Purification Project water.

At this time, there has not been any amendment language shared by the bill authors. We hope to see some level of success in narrowing the list of outstanding technical and implementation issues. It is anticipated that amendment language will be circulated soon.

SB 998 (Dodd) – Water Shut-offs This bill could have a strong impact on our ability to shut-off customers for non-payment. It would prohibit residential water service from being shut off unless the water agency complies with a rigorous process involving extensive noticing and approval of the local public health department, among other provisions. The bill would increase the numbers of days delinquent a household needs to be before a shutoff may be considered.

The District is watching this bill. It is currently being referred to committees.

Water Authority Sponsored Bills The following bills are being sponsored by the San Diego County Water Authority. We will continue to follow these bills.

AB 2064 (Gloria/Weber) This measure is intended to improve cash flow challenges for disadvantaged community and non-profit organization participants in Integrated Regional Water Management program grant awards by ensuring accountable opportunities for advanced payment of grant funds for those participants.

AB 2371 (Carrillo) This measure would advance a series of DWR Independent Technical Panel consensus recommendations relating to improving outdoor landscape water use efficiency. The Water Authority is co-sponsoring legislation in this area with the Natural Resources Defense Council (NRDC).

SB 1277 (Hueso) This spot bill is intended as a legislative vehicle to allow Imperial Valley, nongovernmental organization interests, and other stakeholder interests to develop a sound and workable governance and administrative structure to facilitate implementation of the 10-year Salton Sea.

RECOMMENDATION(S):

Hear Staff Report; no action needed.

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Meeting Date: 3/7/2018 Dept. Head: Allen Carlisle Submitted by: Melissa McChesney Department: Administration

BOARD AGENDA REPORT Approved by: Allen Carlisle, GM

SUBJECT: CONSIDER FINANCIAL CONTRIBUTION TO ACWA'S "NO DRINKING WATER TAX EDUCATION AND OUTREACH CAMPAIGN"

RECOMMENDATION(S):

1. Hear staff report on the status of Water tax legislation in California. 2. Approve $10,000 financial contribution, or Board determined amount, to ACWA's "No Drinking Water Tax Education and Outreach Campaign"

ALTERNATIVE(S):

Do not provide funding.

ATTACHMENT(S):

None

FUNDING:

Requested amount: $10,000 Budgeted amount: This item was not specifically budgeted but funds are available within the operating budget. Are funds available? Yes No Project cost to date:

PRIOR BOARD/COMMITTEE CONSIDERATION:

STRATEGIC PLAN IMPLEMENTATION:

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EXECUTIVE SUMMARY:

The Association of California Water Agencies (ACWA) is asking members in opposition of the drinking water tax proposed in SB 623 and the Budget Trailer Bill to engage in an education and outreach campaign. ACWA has launched a fundraising effort to secure an outside public affairs firm to help develop a more strategic external affairs campaign and assist with coalition building outside the water industry. They also intend to fund an advertising campaign focused on key legislative districts.

DESCRIPTION:

ACWA is asking members to take specific actions to oppose a budget trailer bill that is proposing a state tax on drinking water and to continue to oppose SB 623 (Monning) and the Budget Trailer Bill. In additional to the individual agencies activities, ACWA is planning to secure a public affairs firm to develop and implement develop a strategic external affairs campaign to assist with coalition building outside the water industry and engage in an advertising campaign focused on key legislative districts.

Background on the Water Tax Bills During the 2017 legislative session ACWA and more than 100 of their member agencies actively opposed SB 623 by Sen. William Monning (D-Carmel), which proposed a tax on drinking water as a means of funding drinking water solutions in some disadvantaged communities. SB 623 is now a two-year bill and is currently sitting in the Assembly Rules Committee.

Governor Brown’s Administration, in coordination with the proponents of SB 623, is attempting to advance the SB 623 proposal in a Budget Trailer Bill. If the Administration is not successful with the budget trailer bill, Sen. Monning will try to move SB 623.

ACWA’s State Legislative Committee took an oppose-unless-amended position on the budget trailer bill on Friday, Feb. 9.

The Assembly Budget Subcommittee No. 3 on Resources and Transportation will hear the budget trailer bill on Wednesday, March 14. The Senate Budget Subcommittee No. 2 on Resources, Environmental Protection, Energy and Transportation will hear it on March 15.

Advancing a Better Solution Some disadvantaged communities and low-income residents in certain parts of the state do not have access to safe drinking water. The intent behind SB 623 and the budget trailer bill is to fill gaps in funding for safe drinking water for such communities and residents. ACWA and Padre Dam agree with that intent but strongly opposes the proposed tax on drinking water.

ACWA is advocating for a package of funds that is comprised of existing federal safe drinking water funds, general obligation bond funds, the assessments related to nitrate proposed in the budget trailer bill and in SB 623 and some funding from the state’s general fund.

ACWA continues to lead the Drinking Water Tax Oppose-Unless-Amended Coalition that is meeting with assembly members and senators.

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RECOMMENDATION(S):

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Meeting Date: 3/7/2018 Dept. Head: Karen Jassoy Submitted by: Karen Jassoy Department: Finance BOARD AGENDA REPORT Approved by: Allen Carlisle, GM

SUBJECT: SEMI-ANNUAL REPORT ON THE FIVE YEAR BUSINESS PLAN, FOR THE SIX MONTHS ENDED 12/31/17

RECOMMENDATION(S):

Hear a report on the financial highlights for the first half of FY ‘18.

ALTERNATIVE(S):

1. Table to future meeting.

ATTACHMENT(S):

1. Performance Indicators for the Second Quarter of FY ‘17 2. Summary Financial Statements for the six months ending 12/31/17

FUNDING:

Requested amount: n/a Budgeted amount: Are funds available? Yes No Project cost to date:

PRIOR BOARD/COMMITTEE CONSIDERATION:

STRATEGIC PLAN IMPLEMENTATION:

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EXECUTIVE SUMMARY:

The Board approved Padre Dam’s third Five Year Business Plan and Budget (Plan) on June 21, 2017. The Plan requires staff to provide quarterly performance indicators, semi-annual written updates and annual presentations. This agenda covers the first six months for year one of the Plan (July 1, 2017 – December 31, 2017).

DESCRIPTION:

The Five Year Business Plan, which covers FY ’18-’22, is a key planning instrument and road map to “Ensuring a Strong Future” for Padre Dam. The Plan identifies the work to be performed and the related rates to produce necessary revenues to achieve the Plan’s goals. The Plan holds staff accountable with established goals and performance measurements, the progress for which is shown by Qualitative and Quantitative Performance Indicators. Attachment 1 shows these indicators and the status of each (for Qualitative: Not Started, On Task, Off Task or Completed / for Quantitative: Goal, Actual and % to Goal). Attachment 2 shows the Statement of Activities for each Operation for the first six months of FY ’18.

OPERATIONS / PREVENTATIVE AND PREDICTIVE MAINTENANCE

In the first half of FY ‘18, Operations staff achieved the majority of its goals. Operations updated the new Plan to include even more performance indicators. The Water Recycling Facility (WRF) added several indicators including inspections of equipment, rebuilding of pumps and calibrations to name a few. They have consistently achieved these goals. The WRF will be shut down for approximately 30 days in April to accommodate maintenance work in the secondary basins as well as some needed work in the Influent Pump Station (IPS) wet well. WRF staff also supports the AWP program by operating and maintaining the facility. They also conduct many tours of the facility which allows them to share their expert knowledge with the public.

The valve replacement program continues to go strong with a total of 80 valves replaced in the first half of the fiscal year (the goal was 66). Crews have been dedicated to keeping this program on track and should be commended for a job well done! Engineering is currently wrapping up a valve replacement contract in which 21 valves were replaced.

As a result of the drought, Operations continues to alter its flushing efforts and implement new methods to maintain water quality. Staff continues with the aggressive reservoir cleaning schedule and upgrades to our chlorine generating and dosing equipment. These systems have resulted in improved water quality and ongoing work is needed to maintain and expand on these improvements. As we continue to develop alternatives to main flushing, staff will maintain regulatory requirements and water quality in the reduced flushing program. Staff have been working with the County Water Authority (CWA) and neighboring districts to work on solving some water quality issues related to nitrification and water age from CWA pipeline number four.

Planning is underway to switch from combined chlorine to free chlorine in the CWA system for a period of 30 days. This would allow the more aggressive free chlorine to burn off any biofilms inside of the pipes, with the expected result being less nitrification and better water quality. This would require additional work from each member agency to transition from combined chlorine to free and then back to combined. Additional work includes transition plans submitted to the Division of Drinking Water (DDW), staff flushing the system and monitoring water quality throughout the transition. The switch to free chlorine used to be a regular occurrence, however the practice was ended in the late 1990’s.

Sewer crews continue to achieve their goals with the exception of sewer line repairs (73%) and hot spots (85%), which are due to timing issues. Hot spots are completed on intervals of 60, 90 or 180 days. Staff has been utilizing “Smart Covers” to reduce the numbers of hot spots. Smart Covers are installed in manholes and can monitor the levels of flow. If the sensor detects an increasing level, an alarm is sent to sewer staff. They can log onto a computer to see the levels, trends, alarm set points, etc. Staff has been monitoring several areas to determine if we can reduce the frequency of a hot spot or eliminate it completely.

The Electrical/Cathodic group had several indicators that were off goal. Our Cathodic staff member has been busy assisting the Engineering Department with projects and coating inspections for some of the many projects that Page-28- 2 of 11 they have going. A flexible staff and the ability to work across department lines speaks to the great employees with “can–do” attitudes that we have at the District. Efforts will be made to make up time on missed goals.

Capital Equipment Replacements appear off-goal, however this is a timing issue. Several vehicles including a 10 yard dump truck, backhoe, bobcat and a waste water pump will be coming to the Board for consideration and approval in the near future.

The ability to remain flexible and shift staff to where the work is most needed has been a success in the Operations Department. From the staff at the Laboratory and WRF to the Alpine yard, staff continually impress with their dedication to the District and the quality of their work.

ENGINEERING / CAPITAL IMPROVEMENT PROGRAM (CIP)

The District’s CIP is the foundation of its long-range capital investment plan and integral to sound financial planning. The CIP establishes a specific list of preventive maintenance, capital replacement and improvement projects and related costs. These costs feed into the development of revenue requirements and ultimately rates. The CIP is also a major component of the Five Year Plan. The CIP budget is structured to position the District to take the initial steps towards achieving long term infrastructure sustainability in the most efficient manner; this approach is summed up by the 3 R’s: reliability, resiliency, and rate payer affordability.

Overall objectives of the CIP during this Five Year Plan include:

• Prioritizing critical assets through condition assessment or replacement • Compliance with regulatory mandates • Ensuring safe and reliable water and sewer facilities • Supporting the District’s AWP Program

Additional priorities include refurbishing and improving existing aging facilities, creating redundancy in the water distribution and transmission systems and ongoing capitalized operations projects. The chart below shows CIP activity verses budget through the first six months of the fiscal year; a brief project summary follows.

CIP General

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 Sewer Projects: Construction of this project is underway and anticipated to be completed prior to the end of the fiscal year. This project includes Techite Sewer Replacement between Mast Boulevard and Carefree Drive in Santee, Sewer Diversion Structure Replacements (Walmart & Carlton Hills), Mission Creek Sewer Lift Station Piping Repairs, and sewer rehabilitation near Wenatchee Avenue. The projects were combined into a single larger Project to gain efficiencies and assist in expediting completion of the CIP projects.

 Influent Pump Station (IPS) & Force Main Improvements and Ray Stoyer Water Recycling Facility (WRF) Primary & Secondary Basins Refurbishment Project: This project consists of rehabilitation of the IPS wet well, temporary sewer flow diversion, construction of a new sewer force main manhole, crack repair in the WRF concrete basins, and installations of new stainless steel wear strips in the WRF concrete basins. Work will require a one month long shutdown of the WRF. The shutdown is scheduled for April 2018. Construction is anticipated to be completed prior to the end of the fiscal year.

 Pump Station No.3 and 4 Surge Tanks Replacement Project: This project includes replacement of a total of four existing potable water surge tanks located at Flinn Springs Pump Station (PS 3) and Arnold Way Pump Station (PS 4), one on the suction side and one on the discharge side at each location. The work also includes surge tanks inlet and outlet pipe replacements, site work, and bypass piping improvements. The construction contract for the project has been awarded and submittals are being received and reviewed. The contractor is anticipated to mobilize at PS #3 in April 2018.

External Agency Mandates

During a recent storm drain and roadway improvement project along Alpine Boulevard in the Eastern service area the County of San Diego discovered a conflict between their storm drain alignment and the District’s existing 14- inch ACP water main. The District was required to relocate the 14-inch ACP water main to eliminate the conflict in order for the County to complete their storm drain installation. In order to meet the County’s urgent timeline to avoid delay claims from the County and County’s contractor, the District used the existing contractor on the ESA Secondary Connection project, JR Filanc Construction to complete the relocation.

ESA Secondary Connection

One of the most significant highlights of the CIP is the advancement of the ESA Secondary Connection Project. This project will provide a new water supply connection to the San Diego County Water Authority and a new transmission line to our Eastern Service Area while also adding a new element of reliability to the system. As of December 31, 2017 construction accomplishments include: installation of the 20-inch pipe (tunnel) underneath Interstate 8, installation of the concrete reservoir, installation of the CWA flow control facility masonry walls, pump station roof concrete pour, and continuing installation of discharge pipeline in Ridge Hill Road. Staff continues to coordinate with the Viejas cultural monitor and the consultant archaeologist regarding all soil disturbing activities.

HUMAN RESOURCES / SAFETY & RISK

The Human Resources Department is committed to providing excellent service to employees, retirees and prospective applicants in an effort to enhance the overall work experience. This work experience includes every employee’s right to work in a safe and healthy workplace. A couple areas of focus over the last quarter were recruitment and retention, and staying competitive within feasible budget constraints and working to prevent employee injury and illness.

One goal the HR department has for this Plan is to reduce the time and cost of hiring for the District. With our new applicant tracking system and new found efficiencies, we’ve been able to get our overall hire time down from 45 days + to an average of 28 days. In addition, our average advertising cost to hire is $360 down from over $500. The HR Department in conjunction with our benefits broker, Barney & Barney were successful this year in maintaining our competitive benefit plans and staying well under budget.

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COMMUNICATIONS

The Communications Department’s objective is to inform and educate our customers and the community on the District’s services, rates, customer programs and projects. This helps build customer awareness and community trust. Key focus areas in this Plan include: Demonstrating Value, Water Supply and Reliability Messaging, Public Outreach and Government Relations. Highlights of the accomplishments in each of these areas are below.

Demonstrating Value  Hosted multiple District facility tours in Fall ‘17. Our next two tours are scheduled for March 14 & 17.  Hosted a three hour water-efficient landscape class in February 2018.  Developed a new series called Padre Profiles. These are short stories on District staff about the work they do for the District and how it provides value to our community. We produce these bi-monthly. The write- up and photos are included in District e-newsletters, website, social media and internally on the Stream.  Produced a video on the Eastern Secondary Connection Project to educate customers on the importance of the project and the value it will provide the community.  Produced a video on the Woodrose Ave sewer project.

This area is important because many times customers don’t fully understand what we do and why. The communications work we are doing will help to better educate and inform customers of the important work we do to ensure high quality service each and every day.

Water Supply and reliability  Hosted 30 tours of the Advanced Water Purification Demonstration Facility. These tours groups include school groups, robotics teams, scouts, general public and other interested special groups. We currently have 10 tours scheduled for the month of March.  Hosted close to 100 Girls Scouts for a Water Journey day in October 2017. Our next Water Journey Event is scheduled for March 17 and has over 150 Girl Scouts registered.  ACWA News recently highlighted our project.  KPBS covered our project as a water reliability project.  Multiple news channels covered the AWP project’s Tracer Study at Lake Jennings the end of 2017.

Outreach for the AWP Program ensures we inform and educate the community on the project’s benefits and needs. Additional outreach in the Spring will focus on communicating directly with our customers and community.

Public Outreach  New Branding Style Guide rolled out and implemented to staff.  Multiple social media posts per week. Venues include: Facebook, Twitter, Instagram and Nextdoor. We added Instagram in October and have seen positive interaction on this newer platform.  New internal video completed that provides employees with an update on District happenings and water industry news.  E-newsletters are distributed to customers at least bi-monthly. The last one was sent in January.  Bill messages provided on customer bills about upcoming tours, classes and other water related topics.

Government Relations  Outreach to our customers on the proposed State Water Tax.  Continued work with the Department of Water Resources and the pilot study they are doing on landscape area measurement.  Produced multiple letters to the State Water Board on Proposed Water Waste Prohibitions and Long-term Conservation Regulations.  Working with San Diego and Orange County agencies to push for 30% credit for potable reuse water.  Tracking all District related bills and ensure action is taken.

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This area is especially important with all of the water related legislation that we continue to see be a priority for the Governor and the State Legislature. We are involved at a level, State and Federal level and make sure we speak up about what is right for our customers and ensure a reliability water supply into the future.

SANTEE LAKES RECREATION PRESERVE

Santee Lakes Recreation Preserve (Preserve) continues its mission as a premier destination and is hard at work implementing designs from the Dynamic Vision and Strategic Plans. The Preserve’s primary goal for the Plan is financial sustainability. Other elements of the Plan include Capital Improvement and Equipment Projects, Grants and Fundraising, Recreation Programs and Events, Predictive and Preventive Maintenance, and Brand Development. The Preserve remains on-track to accomplish the vast majority of the goals set for the Plan.

Brand Development  Instagram 1,726 followers last quarter  Facebook 13,675 Likes with an average of 109,000 people per month that see a post on their screen.  Twitter 6,800 impressions last quarter

Grants and Fundraising:  Pardee Homes Santa at the Lakes Snow $5,750  Santee Lakes Foundation Santa at the Lakes Storybook Character Island $5,300  Santee Lakes Foundation Camper Dog Park $13,840

Recreation Programs and Events  Stockzilla Catfish Mega Stock  Ladies at the Lake Fall Market  Trout Opener  Light up the Lakes Camper Event  Scarecrow Festival Camper Event  Santa at the Lakes Community Event  Clubhouse: Potlucks, Camper Coffee, Family Game Night, Lion’s Club Fundraiser Breakfast, Halloween Activities, Holiday parties, Yoga

Predictive and Preventive Maintenance  Lake Maintenance (harvesting, herbicide application, rebuilt aerator motors, APAP compliance including water sampling and reports)  Replaced 7 sofas and blinds in the Cabins; replaced the range top in Cabin 4  Tree trimming and removals and fertilize turf  Quarterly HVAC service throughout the facility  Rebuilt the lake aerator motors  Replaced the Sprayground feature pump  Replaced the AC unit at the Gatehouse  Repaired water leak at N.Lk.5 restroom  Installed traffic signs on W.Lk.2/3  Re-plastered the spa  Installed new shelving in the Maintenance Shed Other  Hired FT Outside PRC Hayley Murray, Richard Imbimbo and Ray Bach  Camper ‘Bark Park’ Dog Park completed  West Side Park Improvement Project completed  80 ADA compliance issues completed

FINANCE

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Accounting / Finance Update:

Finance has been working closely with Engineering and General Manager on the Advanced Water Purification Project. The CFO is involved with the negotiations with the Project partners, the Ad Hoc Board Committee and the Plan of Finance, among other things. Finance has also been working closely with the Engineering and Operations departments to update developer and project tracking and billing. Finance also prepared and submitted the new Five Year Budget to the CSMFO for an award, which it recently received.

The Accounting Department is responsible for setting and monitoring the budget and preparing a monthly financial packet for the Board. Staff prepares a report for each cost center and department showing actual expenditures versus budget each month. Directors are responsible for ensuring their department stays within budget. There is flexibility within the budget to address unanticipated items as long as over the Plan’s five years, total budgeted expenses are not exceeded. Likewise, planned expenditures can be delayed to future periods depending on need without the risk of losing funding.

The Accounting Department’s cross training efforts have been very successful, allowing for coverage during planned and unplanned absences. Additional duties in accounting include weekly AP check runs, bi-weekly staff and monthly board payrolls and compliance with PERS, State and IRS reporting requirements. Staff also continues to provide monthly financial statements to the Board and public including reporting on all district operations, investments and CIP.

Customer Service Update:

Customer service modified the District’s rate structure as a result of the Cost of Service study performed by Carollo and approved by the Board in 2017. The study created new revenue classes, reduced the number of tiers, and eliminated Variances and the Evaporation Transpiration (ET) Percentage.

Staff was successful in wrapping up a couple of outstanding software fix tickets with Advanced Utility Systems. The Helix bi-monthly read import and the Lakeside annual consumption import reports are now operational resulting in staff not having to spend hours entering data manually for billing.

In an effort to maintain current customer contact information, staff has sent over 6,000 letters to customers that do not have an email address on file. This allows the District to have current contact information in the event we have to contact the customer for emergency or scheduled water service interruptions.

Registration continues to rise for the online water use tool Aquahawk. The District now has over 9,150 customers who have registered to access and monitor their water use. Aquahawk has been a great tool for customers and staff alike in that it shows exact amounts, dates, and times of water usage which assist in the investigation of high bills or questionable usage. The system also has the ability to send alerts to customers notifying them that a dollar or consumption threshold has been met.

Considerable time and effort has been made to analyze the department’s bad debt collections effort. Measures are now in place to maintain communication with customers who are no longer on service and a final bill has been sent. Both written and telephone follow up measures have shown to be very effective in receiving a payment prior to the account being sent to our collection agency which charges a significant fee to collect the debt. The department has also increased the amount of deposits collected by 1/3 which is helping mitigate the bad debt sent to the collection agency.

The Sycuan Band of Kumeyaay Nation account is no longer receiving the eastern service area tax credit. The tax credit is for those accounts that pay a portion of their water service on their property tax bill in our eastern service area. Since Sycuan doesn’t pay property taxes, the credit was removed resulting in $20,000 in annual savings.

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Field Services Update:

The Field Service Technicians continue to meet the goal of installing 250 new water meters and 400 AMI radios per month. This effort is part of a long-term 7 year plan for staff to replace all the meters in the District. The department currently has a successful AMI reading percentage of over 99.82%.

New more powerful gateways have been installed to relay the metering data to the main database. Since these new gateways are more robust, fewer are required. In an effort to reduce the AMI infrastructure, 43 older gateways have been taken out of service and were replaced by only 17 new ones. The new gateways have proven to be more resilient to the elements by maintaining operation during times of extreme heat, cold, and rain.

Staff is currently working on the reduction of the AMI system repeaters. There are currently over 500 repeaters and it is our hope to reduce this number by half by the end of 2019. We are developing a solar solution to provide permanent power to locations without an energy source to feed the new more powerful repeaters.

Information Systems Update:

The goal of the Information Systems (IS) team is to provide information technology infrastructure, solutions and services that support the mission, vision and values of Padre Dam.

The primary focus for IS staff this quarter were the efforts to launch the new OnBase document and agenda management software. This is a large collaborative effort involving staff from IS, GIS, Administration, and subject matter experts from each department as well as a technical team from Hyland Software. The team has worked to prepare the system to catalog and index over 86,000 documents and to create workflows for the meeting agenda generation process.

Other areas of progress include preparations to migrate from Office 2010 to Office 365/2016. All end users have been provisioned for Office 365. Office 2016 installations continue as Windows 10 is rolled out: a new primary physical server to support the 2012/2016 Active directory upgrade is provisioned and ready; another 4 servers were provisioned with Microsoft Windows Server 2012-2016 reaching 50% toward the goal of replacing all servers running the Server 2008 operating system. Application support included further enhancements to the DigAlert mobile application developed by GIS staff. The latest enhancement included integration into the DigAlert “Positive Response” function. This function benefits both the Development Services team and the customer requesting the DigAlert mark outs by reducing paperwork and steps to completion for responses. And finally IS and GIS staff addressed over 50 help desk tickets submitted to the Track-IT system

FINANCIAL UPDATE

Current Fiscal Year

The Board approved the District’s 3rd Five Year Budget when it approved the Five Year Business Plan on June 21, 2017. The Budget was developed to provide funding for important goals and projects while minimizing rate increases. Rate increases for the Five Year Plan, developed during a Comprehensive Cost of Service Study by Carollo Engineers were approved on June 21st as well.

For the six months ending 12/31/17, combined District revenues were favorable to budget by $2.5M; all operations other than Recycled Water contributed to this positive variance (Recycled was slightly under budget). Fixed costs related to higher sales partially offset this positive variance but lower than budgeted operating expenses more than offset that impact. Overall, combined income from operations and combined change in net position were both S2.7M favorable to budget. The following provides more information about each operation’s performance for the first six months of FY ’18.

 Potable Water Operation: The budget for the Plan assumes consistent water sales over the five years. Budgeted sales volumes were based on an analysis of prior years, a slight bounce back in FY ’17 and some future growth. Actual acre feet sold of 5,237 exceeded budget by 414 AF. Water sales revenue of $20.8M

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exceeded budget by $1.7M or 8.9%. Water purchases were also higher due to the increased demand; purchases of $8.5M exceeded budget by $8.0M or 7%. Overall revenues available for operations exceeded budget by $1.2M. Operating expenses were $775K favorable to budget while depreciation was essentially on budget. Change in net position was favorable to budget by $1.8M.

 Recycled Water Operation: Total operating revenues were $127K or 5.6% unfavorable to budget. This was due to a reduction in MWD recycled water credits (our unit cost now exceeds the MWD maximum). This was offset by operating expenses being $140K under budget. After non-operating expenses and depreciation, overall change in net position for this operation was $638K or $11K favorable to budget.

 Sewer Operation: The budget for the Plan also assumed consistent sewer volumes over the five years. Budgeted sales volumes were based on an analysis of prior years, a slight bounce back from increased water use in FY ’17 and some future growth. Actual revenue was $610K favorable to budget which was offset by direct costs for sewer treatment being $474K over budget. Operating expenses were under budget by $454K while depreciation was over budget by $88K. Overall change in net position was $765K or $620K favorable to budget.

 Park Operation: Park fee revenues were $104K favorable to budget and direct costs were slightly under budget ($6K). Total operating expenses were $162K favorable to budget. Overall change in net position was $364K verses a budgeted loss of $17K.

The following summaries show revenues and expenses verses budget and fund balances verses targets. Attachment 2 shows this information in more detail.

COMBINED

OPERATIONS A C T U A L B U D G E T DIFF Total Operating Revenues $ 37.14 $ 34.62 $ 2.51 Total Direct Costs (12.94) (11.77) (1.16) Rev Available for Ops 24.20 22.85 1.35 OperatingExpense (15.18) (16.71) 1.53 Depreciation (3.92) (3.76) (0.16) Non-Op Rev/(Exp) (0.36) (0.31) (0.04) Change in Net Assets $ 4.74 $ 2.07 $ 2.68

FUND BALANCE A C T U A L Beginning Fund Balance $ 65.82 Change in Net Assets 4.86 Other Sources/Uses of Cash 2.61 Ending Fund Balance $ 73.29

A C T U A L BOARD MIN BOARD MAX Rate Stabilization Fund $ 18.49 $ 13.65 $ 25.35 Capital Replacement Fund $ 54.81 $ 18.35 $ 29.58 Total Undesignated Fund $ 73.29 $ 32.00 $ 54.93

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POTABLE WATER

OPERATIONS A C T U A L B U D G E T DIFF Total Operating Revenues $ 23.76 $ 21.83 $ 1.93 Total Direct Costs (9.81) (9.11) (0.70) Rev Available for Ops 13.96 12.72 1.24 OperatingExpense (8.04) (8.81) 0.78 Depreciation (2.45) (2.45) (0.00) Non-Op Rev/(Exp) (0.37) (0.17) (0.19) Change in Net Assets $ 3.10 $ 1.29 $ 1.81

FUND BALANCE A C T U A L Beginning Fund Balance $ 31.76 Change in Net Assets 3.10 Other Sources/Uses of Cash 1.47 Ending Fund Balance $ 36.33

A C T U A L BOARD MIN BOARD MAX Rate Stabilization Fund $ 7.92 $ 8.29 $ 15.05 Capital Replacement Fund $ 28.41 $ 8.14 $ 13.55 Total Undesignated Fund $ 36.33 $ 16.43 $ 28.60

RECYCLED WATER

OPERATIONS A C T U A L B U D G E T DIFF Total Operating Revenues $ 2.15 $ 2.28 $ (0.13) Total Direct Costs - - - Rev Available for Ops 2.15 2.28 (0.13) OperatingExpense (1.11) (1.25) 0.14 Depreciation (0.44) (0.41) (0.03) Non-Op Rev/(Exp) 0.04 0.00 0.03 Change in Net Assets $ 0.64 $ 0.63 $ 0.01

FUND BALANCE A C T U A L Beginning Fund Balance $ 11.82 Change in Net Assets 0.64 Other Sources/Uses of Cash 0.56 Ending Fund Balance $ 13.02

A C T U A L BOARD MIN BOARD MAX Rate Stabilization Fund $ 4.15 $ 0.64 $ 1.25 Capital Replacement Fund $ 8.87 $ 3.97 $ 4.19 Total Undesignated Fund $ 13.02 $ 4.61 $ 5.44

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SEWER

OPERATIONS A C T U A L B U D G E T DIFF Total Operating Revenues $ 8.36 $ 7.76 $ 0.61 Total Direct Costs (2.97) (2.49) (0.47) Rev Available for Ops 5.40 5.26 0.13 OperatingExpense (4.18) (4.63) 0.45 Depreciation (0.61) (0.52) (0.09) Non-Op Rev/(Exp) 0.15 0.03 0.12 Change in Net Assets $ 0.77 $ 0.15 $ 0.62

FUND BALANCE A C T U A L Beginning Fund Balance $ 18.10 Change in Net Assets 0.77 Other Sources/Uses of Cash 1.50 Ending Fund Balance $ 20.36

A C T U A L BOARD MIN BOARD MAX Rate Stabilization Fund $ 6.04 $ 3.31 $ 6.62 Capital Replacement Fund $ 14.32 $ 5.48 $ 10.96 Total Undesignated Fund $ 20.36 $ 8.79 $ 17.58

PARK

OPERATIONS A C T U A L B U D G E T DIFF Total Operating Revenues $ 2.85 $ 2.75 $ 0.10 Total Direct Costs (0.16) (0.17) 0.01 Rev Available for Ops 2.69 2.58 0.11 OperatingExpense (1.86) (2.02) 0.16 Depreciation (0.41) (0.38) (0.03) Non-Op Rev/(Exp) (0.06) (0.20) 0.14 Change in Net Assets $ 0.36 $ (0.02) $ 0.38

FUND BALANCE A C T U A L Beginning Fund Balance $ 4.13 Change in Net Assets 0.36 Other Sources/Uses of Cash (0.92) Ending Fund Balance $ 3.58

A C T U A L BOARD MIN BOARD MAX Rate Stabilization Fund $ 0.37 $ 1.41 $ 2.43 Capital Replacement Fund $ 3.21 $ 0.76 $ 0.88 Total Undesignated Fund $ 3.58 $ 2.17 $ 3.30

RECOMMENDATION:

Hear a report on the financial highlights for the first half of FY ’17.

Page-37- 11 of 11 PADRE DAM MUNICIPAL WATER DISTRICT Attachment 1 FIVE YEAR BUSINESS PLAN FY '18 - '22 QUALITATIVE PERFORMANCE INDICATORS AND GOALS

Workforce Management Engineering and Customer Operations and Financial Park and Public Information and Support Development Services Water Quality Management Campground Communication Technology

WORKFORCE MANAGEMENT AND SUPPORT Description Goal Quarter

Staffing 1st 2nd 3rd 4th

Time to Hire Less than 45 days 2 2

Cost per hire Less than $500 2 2

Create District HR Video Completed by end of FY19 2 0

Assessment on Need for Salary Survey Completed by end of FY22 2 0

Number of Internships Min of 2 per year 2 2

Internal Promotions 20% 1 2

Involuntary Turnover Less than 5% 2 2 Engagement

Stream Engagement 95% monthly 2 2

Maintain Employee Recognition Events Annually 2 2

Active laterals More than 12 annually 2 2 Performance

Job Related Goals on Annual Review 100% 2 2 -39- EE On Development Plans 40% 2 2

Maintain Mandated Training As required by law 2 2

Pay for Performance Assessment 100% of Annual Reviews on time 1 1 Workers Compensation

Workers Compensation Incident Rate Baseline 2017 (4.40%) – goal is below 5% 2 2

XMOD Improvement Maintain at or below 1.18 2 2

Credit Incentive Points Strive for 90% or better each year to offset premiums 2 2

ENGINEERING AND DEVELOPMENT Description Goal Quarter

Capital Program Development and Implementation 1st 2nd 3rd 4th

Expend or commit planned CIP budget 85% by the end of the Five Year Business Plan 2 2

Minimize overall change orders for CIP program Below 10% 2 2

Provide project update to Stream when project is bid 100% of projects 2 2 Planning and Compliance

Update Sewer System and Urban Water Management Plans Complete by 2020 0 0

Renew NPDES permit Renew by 2021 0 0

Review and update Comprehensive Facilities Master Plan Complete by 2021 0 0

Implement Ph1 of the East County AWP Program Complete by 2022 2 2 Development Services

Review and Update Capacity Fee Review quarterly, update per policy 2 2

Provide Development Projects update to website and Stream Quarterly 2 2

Complete plan review of projects Within 4 to 6 weeks of project completion 2 2 Inspection

Dig Alert Response Within 2 days of notification and accuracy rate of 99.9% 2 2

Close out projects timely Within 3 months of filing of notice of completion 2 2 Right of Way (R/O/W)

Resolve any encroachment Within 6 months of discovery 2 2

Ensure necessary R/O/W for development projects / capital projects is acquired Before finilization of plan review / before bidding projects 2 2 PADRE DAM MUNICIPAL WATER DISTRICT FIVE YEAR BUSINESS PLAN FY '18 - '22 QUALITATIVE PERFORMANCE INDICATORS AND GOALS

CUSTOMER SERVICES Description Goal Quarter

Billing, Receipts, and Collections 1st 2nd 3rd 4th

Maximize collection of bad debts Reduce bad debt sent to agency by 10% 1 2

Decrease printing and mailing costs Increase number of e-bill users by 10% 1 2 Customer Assistance

Increase response to customer inquiries Minimize abandoned calls and reduce customer call wait times 1 1

Track registered users of Aquahawk online water use portal Increase customer registration by 30% 2 2 Meter Services AMI

Increase efficiency and performance of upper level AMI System Reduce AMI Gateways from 44 units to 17 units by end of 2017 2 2

Increase efficiency and performance of upper level AMI System Reduce number of repeaters in AMI infrastructure 50% by end of 2019 2 2

Reduce manual meter reading Maintain AMI electronic reading percentage of over 99% at all times 2 2

OPERATIONS AND WATER QUALITY Description Goal Quarter

Operations and Maintenance Department - General 1st 2nd 3rd 4th Expand the use of GIS Ongoing Pursue solutions to the flooding issues in Sycamore Creek Ongoing Complete all regulatory reports Annually Construction Group Site paving projects Ongoing -40- Minimize Sewer Hot Spots using Smart Cover technologies Ongoing Water Operations Install reservoir management systems By 2020 Site security upgrades Ongoing Ready all pump stations for bypass pumping operations By 2021 Water Recycling Facility Meet permit discharge requirements 365 days Ongoing Perform required maintenance of all major plant equipment annually Annually Inspect chlorine scrubber Annually Overhaul one vertical turbine pump and motor Bi-Annually beginning 2019 Evaluate a new computerized maintenance program Ongoing Laboratory and WRF Control Room upgrades By 2018 NPDES Permit renewal process Ongoing (Expires in 2021)

FINANCIAL MANAGEMENT Description Goal Quarter

Accounting 1st 2nd 3rd 4th

Time to Run Payroll Less than 4 days 2 2

Timely processing of Invoices Realize 90% of discounts available 2 2

Timely filing of all IRS/State of CA payroll related reports Within 30 days after quarter end 2 2

Timely issuance of 1099s and W2s Annually By January 31 each year 0 0

Timely distribution of financial statements To Board by 2nd meeting each month 1 2

Timely distribution of audit To Board by 2nd meeting in November 1 1

Timely filing of State Controllers Report Annually by January 31 0 0

Stay Current on Munis Software Convert to V11 by end of FY '18 0 2 Budgeting and Planning

Timely budget completion Finalized and approved before beginning of each fiscal year 2 2

Timely completion of Budget to actual reports for departments By 3rd week after month end 2 2

Issue 10 Year History report Annually Draft by October 31 each year, final within 30 days of completed audit 2 1 PADRE DAM MUNICIPAL WATER DISTRICT FIVE YEAR BUSINESS PLAN FY '18 - '22 QUALITATIVE PERFORMANCE INDICATORS AND GOALS

FINANCIAL MANAGEMENT (Cont.) Description Goal Quarter

Finance and Investing 1st 2nd 3rd 4th

Comply with debt service Coverage Requirements Debt Service Coverage greater than 1.2X 2 2

Comply with Bond Disclosure Requirements Annual Continuing Disclosure Report posted by March 31 0 0

Minimize Borrowing Costs Maintain at least an AA credit rating 2 2

PARK AND CAMPGROUND Description Goal Quarter

Financial Sustainability 1st 2nd 3rd 4th

Occupancy Rate Above 80% annually 2 2

Sponsorship Revenue 15% revenue increase by 2022 2 2

Event Area Revenue $200,000 by 2022 2 2

Call Metrics 90%+ Service Rate monthly 2 2

Good Sam 9.0 annual rating 2 2

Instagram Followers 5,000 by 2022 2 2

Facebook Likes 15,000 by 2022 2 2 Organizational Development

Stream Engagement Weekly login; 12 articles and 2 discussions annually 2 2

Award Applications 1 annually 2 2

Work Camper Program Create development plan by 2018 2 2 -41- Work Camper Program Implement applicant software tracking by 2018 2 2 Predictive and Preventive Maintenance

Urban Forest Trim 80% of the trees in our Urban Forest by 2022 2 2

HVAC Units Perform quarterly maintenance at 100% 2 2 Dynamic Vision Plan

General Store Remodel Complete by 2020 2 2

Park Administrative Building Remodel Complete by 2020 2 2

PUBLIC COMMUNICATION Description Goal Quarter

Demonstrating Value 1st 2nd 3rd 4th

Engagement on Value of Water Provide at least 1 tour or class to customers on a quarterly basis 2 2

Develop and maintain online reporting tool for performance measurements Develop in first year of plan and continue semi-annual updates 2 2

Informational campaigns on water services Develop new messaging or tactic at least twice annually 2 2 Water Supply and Reliability Messaging

AWP Tours Minimum of 1,000 visitors per year 2 2

AWP Outreach Positive customer feedback and continued increase in customer reach 2 2

Water Supply Condition Messaging Develop messaging as needed based on conditions 2 2

AWP Construction Outreach Messaging to impacted residents and businesses 2 2 Public Outreach

Enhance Outreach Use of new technology or online services for customers 2 2

Provide updates to the District website New items monthly 2 2

District Project communications Provide information to customers at least 7 days before work begins 2 2

Media Relations Positive earned media on District stories 2 2

Social Media Engagement Increased reach of message and customer engagement 2 2

Branding Ensure District is presented positively & accurately in all representations 2 2

District Reports (Water Quality, Annual Report & other required) Complete reports on time each year 2 2

Web Videos At least 1 new services video per year; additional videos for social media 2 2 PADRE DAM MUNICIPAL WATER DISTRICT FIVE YEAR BUSINESS PLAN FY '18 - '22 QUALITATIVE PERFORMANCE INDICATORS AND GOALS

PUBLIC COMMUNICATION (Cont.) Description Goal Quarter

Government Relations 1st 2nd 3rd 4th

Provide comments on items with impact to Padre Dam At least 90% of items that have an impact on Padre Dam and ratepayers 2 2

Legislative Updates to the Board At least semi-annually 2 2

Enhance relationships with elected officials Meet with annually and share important District news regularly 2 2

INFORMATION TECHNOLOGY Description Goal Quarter

IT Infrastructure and Operations 1st 2nd 3rd 4th

Transition to Exchange Online and Office 365 Complete by 7/1/2018 2 2

Upgrade Active directory domain level to 2012/2016 Complete by 1/1/2019 2 2

Expand and maintain data and telecommunications networks Ongoing 2 2

Replace phone system with a unified system District wide Complete by 9/1/2108 2 2

Upgrade all servers to Microsoft Windows Server 2012-2016 Complete by 12/1/2020 2 2

Implement IT/GIS staff technical training program Ongoing 2 2

Implement IT/GIS staff change management training program Complete by 12/1/2018 0 0

Improve Documentation and tracking of all IT contracts Ongoing 2 1 IT Service and Applications

Migrate services to Cloud computing models where feasible When feasible 2 2 -42- Place all major applications on an update schedule Complete by 7/1/19 2 2

Improve SQL report access and availability Complete by 7/1/2020 2 1

Improve multiple source data integration Complete by 7/1/2020 0 0

Implement end user operating system and application training program Complete by 12/1/2019 2 2

Expand mobile user access to District information and applications Ongoing 2 2

Improve IT Service Delivery Ongoing 0 0

Upgrade all compatible desktops to Windows 10 Complete by 1/1/2019 2 2

Improve Help Desk ticket response time Ongoing 0 0

Develop web-based IT/technology orientation for new employees Complete by 7/1/2019 0 0 Information Security

Expand end user interactive Cyber Security awareness program Complete by 12/1/2017 2 2

Conduct a districtwide cyber security assessment Annually with periodic updates 0 0

Generate Backup And Recovery Plans for server hardware recovery Ongoing 2 2

Generate Backup And Recovery Plans for data recovery Ongoing 0 0 PADRE DAM MUINICIPAL WATER DISTRICT > = 90% FIVE YEAR BUSINESS PLAN FY '18 - '22 > = 75% QUANTITATIVE PERFORMANCE INDICATORS AND GOALS < 75%

Operations and Water Quality 1st Qtr (Jul-Sep) 2nd Qtr (Oct-Dec) 3rd Qtr (Jan-Mar) 4th Qtr (Apr-Jun) Current Fiscal Year

Water Recycling Facility GOAL ACTUAL % TO GOAL GOAL ACTUAL % TO GOAL GOAL ACTUAL % TO GOAL GOAL ACTUAL % TO GOAL GOAL ACTUAL % TO GOAL

Flow Meter Calibration 0 0 - 0 0 - 15 0% 0 - 0 0 - -

Chlorine/Sulfur Dioxide Inpsections 2 5 250% 2 2 100% 2 0% 2 0% 4 7 175% 175%

Mixer Inspections 7 2 29% 6 15 250% 7 0% 6 0% 13 17 131% 131%

Mixer Rebuilds 3 2 67% 3 15 500% 4 0% 3 0% 6 17 283% 283%

Submersible Pump Inspections 2 4 200% 2 6 300% 2 0% 2 0% 4 10 250% 250%

Analyzer Calibration 15 11 73% 15 20 133% 15 0% 15 0% 30 31 103% 103%

Exercise all Valves throughout the WRF 11 6 55% 11 20 182% 11 0% 11 0% 22 26 118% 118%

Perform Hazmat Drill - 0 - 1 0 0% - - 1 0% 1 0 0% 0%

Wastewater Group

Sewer Lines Cleaning Footage 151,000 169,884 113% 151,000 173,734 115% 151,000 0% 151,000 0% 302,000 343,618 114% 114%

Sewer Hot Spots Cleaned 123 53 43% 123 156 127% 123 0% 123 0% 246 209 85% 85%

CCTV Footage 15,000 31,989 213% 15,000 15,754 105% 15,000 0% 15,000 0% 30,000 47,743 159% 159%

Jet Scan Sewer Camera Footage 15,000 16,860 112% 15,000 18,170 121% 15,000 0% 15,000 0% 30,000 35,030 117% 117%

Sewer Lines Repaired (Laterals and Mains) 15 18 120% 15 4 27% 15 0% 15 0% 30 22 73% 73%

Sewer Lift Station Inspections 26 24 92% 26 24 92% 26 0% 26 0% 52 48 92% 92%

-43- Unplanned: Sanitary Sewer Overflows (SSO's) 0 1 Private Lateral Sewer Discharge (PLSD) 1 2

Construction Group

Valve Replacement 33 48 145% 33 32 97% 33 0% 33 0% 66 80 121% 121%

Special Projects 0 0 - 1 2 200% 1 0% 0 - 1 2 200% 200% Unscheduled: Water Services Installed 9 2 Sewer Services Installed 0 0 Fire Sevices Installed 1 0 Recycled Water Services Installed 0 0 Relocated/Abandoned Services (All) 10 3 Unplanned: External Agency Mandated Work 1 0 Water Main Failures/Unplanned Outages 3 5

Water Operations Group

Water Mains Flushed 55 97 176% 55 80 145% 55 0% 55 0% 110 177 161% 161%

Valves Exercised 675 710 105% 675 794 118% 675 0% 675 0% 1,350 1,504 111% 111%

Water Quality Monitoring Samples 338 338 100% 341 338 99% 336 0% 330 0% 679 676 100% 100%

Reservoirs Dosed 60 181 302% 60 112 187% 60 0% 60 0% 120 293 244% 244%

Water Systems Site Inspections (45 sites) 317 395 125% 285 338 119% 222 0% 285 0% 602 733 122% 122%

Pump/Motor Maintenance/Recondition 0 1 100% 0 2 200% 2 0% 0 - 0 3 300% 300%

Pressure Reducing Stations Maintenance 2 0 0% 2 0 0% 3 0% 2 0% 4 0 0% 0%

Pump/Motor Replacement 0 0 - 0 0 - 0 - 1 0% 0 0 - - PADRE DAM MUINICIPAL WATER DISTRICT > = 90% FIVE YEAR BUSINESS PLAN FY '18 - '22 > = 75% QUANTITATIVE PERFORMANCE INDICATORS AND GOALS < 75%

Operations and Water Quality (cont) 1st Qtr (Jul-Sep) 2nd Qtr (Oct-Dec) 3rd Qtr (Jan-Mar) 4th Qtr (Apr-Jun) Current Fiscal Year

Electrical/Cathodic Group GOAL ACTUAL % TO GOAL GOAL ACTUAL % TO GOAL GOAL ACTUAL % TO GOAL GOAL ACTUAL % TO GOAL GOAL ACTUAL % TO GOAL

Infrared Camera MCC's 38 34 89% 36 38 106% 38 0% 36 0% 74 72 97% 97%

Motor Control Centers Serviced 12 0 0% 12 8 67% 12 0% 12 0% 24 8 33% 33%

Generators Exercised 93 93 100% 93 93 100% 93 0% 93 0% 186 186 100% 100%

CP Test Station Reads WSA 179 0 0% 179 49 27% 179 0% 179 0% 358 49 14% 14%

Reservoir - CP Reads 17 0 0% 17 11 65% 17 0% 17 0% 34 11 32% 32%

Reservoir - Coating & CP Dive Inspection 1 0 0% 1 0 0% 1 0% 1 0% 2 0 0% 0%

Compliance Group

FOG Inspections 33 37 112% 26 22 85% 35 0% 22 0% 59 59 100% 100%

FOG Spot Checks 36 33 92% 32 32 100% 43 0% 37 0% 68 65 96% 96%

Inspections 4 4 100% 3 1 33% 4 0% 0 - 7 5 71% 71%

Cross Connection Control Inspections 45 28 62% 81 181 223% 15 0% 0 - 126 209 166% 166%

Fleet Maintenance Group

Fleet Maintenance (Service Ticket/Repairs) 45 51 113% 45 41 91% 45 0% 0 - 90 92 102% 102%

Vehicle Rehabilitation/Rebuild 1 1 100% 0 0 - 1 0% 1 0% 1 1 100% 100%

Capital Equipment Replacements 5 2 40% 0 1 100% 4 0% 0 - 5 3 60% 60% -44-

Generators Serviced 0 0 - 0 0 - 12 0% 3 0% 0 0 - -

Facilities Maintenance Projects Completed 1 1 100% 1 1 100% 1 0% 1 0% 2 2 100% 100%

Customer Services 1st Qtr (Jul-Sep) 2nd Qtr (Oct-Dec) 3rd Qtr (Jan-Mar) 4th Qtr (Apr-Jun) Current Fiscal Year

Meter Services and AMI GOAL ACTUAL % TO GOAL GOAL ACTUAL % TO GOAL GOAL ACTUAL % TO GOAL GOAL ACTUAL % TO GOAL GOAL ACTUAL % TO GOAL

Replace failing Datamatic AMI Radios 1,200 593 49% 1,200 1,301 108% 1,200 0% 1,200 0% 2,400 1,894 79% 79%

Meter Replacements MMP 750 772 103% 750 801 107% 750 0% 750 0% 1,500 1,573 105% 105%

NET INCOME / LOSS BY OPERATION OTHER KEY PERFORMANCE INDICATORS Operation YTD Actual YTD Budget Variance Potable Water $3,097,715 $1,286,005 1,811,710 109% Sewer $765,430 $145,379 620,051 0% Recycled Water $637,796 $626,891 10,905 Park $363,570 -$16,956 380,526 109% 0% Combined $4,176,790 $1,500,808 2,675,982

122% OPERATING EXPENSES 0% Operation YTD Actual YTD Budget Variance Salaries and Wages $5,957,945 $6,338,068 -$380,123 25% 0% Employee Benefits $3,835,011 $4,059,301 -$224,290 Professional Services $1,657,717 $2,713,480 -$1,055,763 817% Materials & Supplies $3,079,170 $2,598,864 $480,306 0% Utilities $834,177 $846,761 -$12,584 Admin Expenses $780,533 $881,589 -$101,056 0% 200% 400% 600% 800% 1000% Billing Credits -$961,428 -$723,662 -$237,766 % To Goal - Current FY % To Goal - Five Year Plan Cum Total $15,183,125 $16,714,401 -$1,531,276 Attachment 2

STATEMENTS OF OPERATIONS FOR SIX MONTHS ENDING DECEMBER 31, 2017

RETAIL WATER OPERATION RECYCLED WATER OPERATION SEWER OPERATION PARK OPERATION COMBINED FAVORABLE / (UNFAVORABLE) FAVORABLE / (UNFAVORABLE) FAVORABLE / (UNFAVORABLE) FAVORABLE / (UNFAVORABLE) FAVORABLE / (UNFAVORABLE) Income provided from Operations: A C T U A LB U D G E T$ % A C T U A LB U D G E T$ % A C T U A LB U D G E T$ % A C T U A LB U D G E T$ % A C T U A LB U D G E T$ % Revenues: Water Sales $ 15,938,606 $ 14,537,045 $ 1,401,561 9.6% $ 1,414,877 $ 1,405,747 $ 9,130 0.6% $ ‐ $ ‐ $ ‐ $ ‐ $ ‐ $ ‐ $ 17,353,483 $ 15,942,792 $ 1,410,691 8.8% Infrastructure Access Charge 457,861 453,750 4,111 0.9% ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ 457,861 453,750 4,111 0.9% Energy Billings 786,748 640,153 146,595 22.9% ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ 786,748 640,153 146,595 22.9% CWA/ Metro Credits ‐ ‐ ‐ 102,340 250,741 (148,401) ‐59.2% ‐ ‐ ‐ ‐ ‐ ‐ 102,340 250,741 (148,401) ‐59.2% Padre Dam Sewer Processing Fee ‐ ‐ ‐ 533,442 533,442 ‐ 0.0% ‐ ‐ ‐ ‐ ‐ ‐ 533,442 533,442 ‐ 0.0% Sewer Revenues ‐ ‐ ‐ ‐ ‐ ‐ 8,360,781 7,750,464 610,317 7.9% ‐ ‐ ‐ 8,360,781 7,750,464 610,317 7.9% System Charges 4,910,352 4,606,140 304,212 6.6% 100,372 88,002 12, 370 14.1% ‐ ‐ ‐ ‐ ‐ ‐ 5,010,724 4,694,142 316,582 6.7% Park Fees ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ 2,854,378 2,750,823 103,555 3.8% 2,854,378 2,750,823 103,555 3.8% Property taxes subvention 1,203,385 1,113,222 90,163 8.1% ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ 1,203,385 1,113,222 90,163 8.1% Other Revenues 467,934 483,600 (15,666) ‐3.2% 30 ‐ 30 3,652 7,728 (4,076) ‐52.7% 431 ‐ 431 472,047 491,328 (19,281) ‐3.9% Total Operating Revenues $ 23,764,886 $ 21,833,910 $ 1,930,976 8.8% $ 2,151,061 $ 2,277,933 $ (126,872) ‐5.6% $ 8,364,433 $ 7,758,192 $ 606,241 7.8% $ 2,854,809 $ 2,750,823 $ 103,986 3.8% $ 37,135,189 $ 34,620,857 $ 2,514,332 7.3%

Direct Costs: Water Purchases $ 8,587,354 $ 8,015,901 $ (571,453) ‐7.1% $ ‐ $ ‐ $ ‐ $ ‐ $ ‐ $ ‐ $ ‐ $ ‐ $ ‐ $ 8,587,354 $ 8,015,901 $ (571,453) ‐7.1% Infrastructure Access Charge 453,750 453,750 ‐ 0.0% ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ 453,750 453,750 ‐ 0.0% Energy Purchases 764,624 640,153 (124,471) ‐19.4% ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ 764,624 640,153 (124,471) ‐19.4% Sewer METRO Costs ‐ ‐ ‐ ‐ ‐ ‐ 2,434,340 1,959,948 (474,392) ‐24.2% ‐ ‐ ‐ 2,434,340 1,959,948 (474,392) ‐24.2% Padre Sewer Treatment ‐ ‐ ‐ ‐ ‐ ‐ 533,442 533,442 ‐ 0.0% ‐ ‐ ‐ 533,442 533,442 ‐ 0.0% Fish Stock/Propane ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ 164,398 170,127 5,729 3.4% 164,398 170,127 5,729 3.4%

Total Direct Costs $ 9,805,728 $ 9,109,804 $ (695,924) ‐7.6% $ ‐ $ ‐ $ ‐ $ 2,967,782 $ 2,493,390 $ (474,392) ‐19.0% $ 164,398 $ 170,127 $ 5,729 3.4% $ 12,937,908 $ 11,773,321 $ (1,164,587) ‐9.9%

Revenues Available for Operating Expenses$ 13,959,158 $ 12,724,106 $ 1,235,052 970.6% $ 2,151,061 $ 2,277,933 $ (126,872) ‐557.0% $ 5,396,651 $ 5,264,802 $ 131,849 250.4% $ 2,690,411 $ 2,580,696 $ 109,715 425.1% $ 24,197,281 $ 22,847,536 $ 1,349,745 590.8%

Operating Expenses: Salary & Wages $ 3,346,049 $ 3,573,910 $ 227,861 6.4% $ 477,244 $ 509,743 $ 32,500 6.4% $ 1,520,980 $ 1,624,557 $ 103,577 6.4% $ 613,673 $ 629,858 $ 16,186 2.6% $ 5,957,945 $ 6,338,068 $ 380,123 6.0% Employee Benefits 2,145,834 2,259,239 113,405 5.0% 295,499 311,115 15,617 5.0% 1,027,309 1,081,601 54,292 5.0% 366,370 407,346 40,976 10.1% 3,835,011 4,059,301 224,290 5.5% Professional Services 1,025,482 1,714,907 689,425 40.2% 71,017 118,762 47,744 40.2% 427,322 714,608 287,286 40.2% 133,895 165,203 31,308 19.0% 1,657,717 2,713,480 1,055,763 38.9% Materials, Supplies, Vehicle & Bldg. Rent 1,573,337 1,280,906 (292,431) ‐22.8% 191,721 156,086 (35,635) ‐22.8% 1,021,582 831,704 (189,878) ‐22.8% 292,530 330,168 37,638 11.4% 3,079,170 2,598,864 (480,306) ‐18.5% Administrative Expenses 466,953 316,859 (150,094) ‐47.4% 49,149 33, 351 (15,798) ‐47.4% 203,577 138,141 (65,436) ‐47.4% 60,855 393,239 332,384 84.5% 780,533 881,589 101,056 11.5% Utilities 60,046 101,243 41,197 40.7% 108,189 182,416 74,227 40.7% 274,255 462,419 188,164 40.7% 391,687 100,684 (291,003) ‐289.0% 834,177 846,761 12,584 1.5% Billing Credits (578,203) (432,203) 145,999 ‐33.8% (83,933) (62,739) 21, 193 ‐33.8% (299,293) (223,719) 75,573 ‐33.8% ‐ (5,000) (5,000) 100.0% (961,428) (723,662) 237,766 ‐32.9%

-45- Subtotal $ 8,039,498 $ 8,814,860 $ 775,362 8.8% $ 1,108,885 $ 1,248,734 $ 139,849 11.2% $ 4,175,733 $ 4,629,309 $ 453,577 9.8% $ 1,859,009 $ 2,021,498 $ 162,489 8.0% $ 15,183,125 $ 16,714,401 $ 1,531,276 9.2%

Depreciation/Amort $ 2,454,571 $ 2,449,671 $ (4,900) ‐0.2% $ 440,099 $ 405,188 $ (34,911) ‐8.6% $ 608,152 $ 520,114 $ (88,038) ‐16.9% $ 412,749 $ 380,136 $ (32,613) ‐8.6% $ 3,915,571 $ 3,755,109 $ (160,463) ‐4.3%

Total Operating Expenses $ 10,494,069 $ 11,264,531 $ 770,462 6.8% $ 1,548,985 $ 1,653,922 $ 104,938 6.3% $ 4,783,885 $ 5,149,423 $ 365,538 7.1% $ 2,271,758 $ 2,401,633 $ 129,875 5.4% $ 19,098,696 $ 20,469,510 $ 1,370,814 6.7%

Income (Loss) Provided from Operations $ 3,465,089 $ 1,459,575 $ 2,005,515 137.4% $ 602,076 $ 624,010 $ (21,934) ‐3.5% $ 612,766 $ 115,379 $ 497,387 431.1% $ 418,653 $ 179,062 $ 239,590 133.8% $ 5,098,585 $ 2,378,026 $ 2,720,559 114.4%

Non Operating Activity Interest Expense (Non CEF)$ (488,669) $ (198,570) $ (290,099) 146.1%$ (29,824) $ (12,119) $ (17,705) 146.1% $ ‐ $ ‐ $ ‐ $ (69,166) $ (201,018) $ 131,852 ‐65.6% $ (587,659) $ (411,707) $ (175,952) 42.7% Interest Expense (CEF) ‐ ‐ ‐ (565,512) (565,512) ‐ 0.0% Interest Income (Non CEF) 121,295 25,000 96, 295 385.2% 65,544 15, 000 50,544 337.0% 152,663 30,000 122,663 408.9% 14,083 5,000 9,083 181.7% 353,586 75,000 278,586 371.4% Interest Income (CEF) ‐ ‐ ‐ ‐ ‐ ‐ 62,397 25,000 37,397 149.6% Gain/Loss on Sale of Fixed Assets ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ 39,413 ‐ 39,413 Gain/Loss on Investments ‐ ‐ ‐ ‐ (224,020) ‐ (224,020) Other Income/(Expense) ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ Total Non Operating Income (Expenses) (367,374) (173,570) (193,804) 111.7% 35,720 2,881 32,839 1139.9% 152,663 30,000 122,663 408.9% (55,082) (196,018) 140,936 ‐71.9% (921,795) (877,219) (44,576) 5.1%

Change in Net Assets $ 3,097,715 $ 1,286,005 $ 1,811,710 140.9% $ 637,796 $ 626,891 $ 10,905 1.7% $ 765,430 $ 145,379 $ 620,050 426.5% $ 363,570 $ (16,956) $ 380,526 ‐2244.2% $ 4,176,790 $ 1,500,808 $ 2,675,982 178.3% Other Expense $ ‐ $ ‐ $ ‐ $ ‐ $ ‐ $ ‐ $ ‐ $ ‐ $ ‐ $ ‐ $ ‐ $ ‐ $ ‐ $ ‐ $ ‐ Change in Net Assets after Other Expense $ 3,097,715 $ 1,286,005 $ 1,811,710 140.9% $ 637,796 $ 626,891 $ 10,905 1.7% $ 765,430 $ 145,379 $ 620,050 426.5% $ 363,570 $ (16,956) $ 380,526 ‐2244.2% $ 4,176,790 $ 1,500,808 $ 2,675,982 178.3%

$ ‐

Capital Capital Capital Capital Capital DESIGNATED FUND BALANCES Total Rate Stabilization Replacement Total Rate Stabilization Replacement Total Rate Stabilization Replacement Total Rate Stabilization Replacement Total Rate Stabilization Replacement

Balance 07/01/17 $ 31,764,258 $ 5,874,042 $ 25,890,216 $ 11,824,061 $ 3,541,231 $ 8,282,830 $ 18,096,356 $ 5,135,081 $ 12,961,274 $ 4,130,391 $ 371,176 $ 3,759,215 $ 65,815,065 $ 14,921,530 $ 50,893,535

Change in Net Assets 3,097,715 637,796 765,430 363,570 4,864,511 ‐ ‐ Add Back Depreciation/Amort 2,454,571 440,099 608,152 412,749 3,915,571 ‐ ‐ Changes in Payables/Receivables, Other 4,169,626 611,254 1,651,841 ‐ 6,432,721 ‐ ‐ Cash Generated from Operations 9,721,912 9,721,912 ‐ 1,689,149 1,689,149 ‐ 3,025,423 3,025,423 ‐ 776,319 776,319 ‐ 15,212,803 15,212,803 ‐

CIP/Capital Equip (5,317,084) ‐ (5,317,084) (302,660) ‐ (302,660) (842,785) ‐ (842,785) (936,636) ‐ (936,636) (7,399,166) ‐ (7,399,166) Debt Principal (2,511,788) ‐ (2,511,788) (191,197) ‐ (191,197) ‐ ‐ ‐ (392,948) ‐ (392,948) (3,095,934) ‐ (3,095,934) Transfers to CRF fm Rate Stab ‐ (5,480,722) 5,480,722 ‐ (1,030,048) 1,030,048 ‐ (1,295,724) 1,295,724 ‐ (766,038) 766,038 ‐ (8,572,532) 8,572,532 Interest Income Transfer ‐ (71,564) 71, 564 ‐ (47,847) 47,847 ‐ (77,858) 77,858 ‐ (10,281) 10,281 ‐ (207,550) 207,550 Cash Used for Property Acquisition & Debt (7,828,872) (5,552,286) (2,276,586) (493,857) (1,077,895) 584,038 (842,785) (1,373,582) 530,797 (1,329,585) (776,319) (553,266) (10,495,100) (8,780,082) (1,715,018)

Financing/Contrib Capital/Other Transfers 2,676,027 (2,118,851) 4,794,878 5,111 ‐ 5,111 78,314 (750,372) 828,687 ‐ ‐ ‐ 2,759,452 (2,869,223) 5,628,675

Net Change in Cash $ 4,569,066 $ 2,050,775 $ 2,518,292 $ 1,200,402 $ 611,254 $ 589,148 $ 2,260,952 $ 901,469 $ 1,359,483 $ (553,266) $ ‐ $ (553,266) $ 7,477,155 $ 3,563,498 $ 3,913,658

Balance 12/31/17 $ 36,333,324 $ 7,924,816 $ 28,408,508 $ 13,024,463 $ 4,152,485 $ 8,871,978 $ 20,357,308 $ 6,036,550 $ 14,320,758 $ 3,577,125 $ 371,176 $ 3,205,949 $ 73,292,221 $ 18,485,027 $ 54,807,193

SUMMARY OF FORMAL BOARD OF DIRECTORS’ MEETING FEBRUARY 22, 2018

9-1. Authorize the General Manager to continue the lease agreement for the Water Authority’s Los Angeles Office. The Board authorized the General Manager to continue the existing lease agreement for Water Authority’s Los Angeles Office space for 14 additional months through fiscal year 2019 and increase the General Manager’s authority to pay the lease payments by $16,702, for a new amount not to exceed $266,159.

9-2. Monthly Treasurer’s Report on Investments and Cash Flow. The Board noted and filed monthly Treasurer’s Report.

9-3. Short-Term General Counsel Contract Extension. The Board extended the current General Counsel contract from March 14 through June 30, 2018.

9-4. Federal Legislative Priorities for 2018. The Board adopted federal legislative priorities for 2018.

9-5. Approve enhanced value of water regional communications program and authorize the General Manager to enter into a professional services agreement with Southwest Strategies. The Board approved the enhanced value of water regional communications program Brought to You by Water; authorized the General Manager to enter into a 12-month professional services agreement with Southwest Strategies in an amount not to exceed $244,000 for public outreach services to assist in the implementation of the program; and approved the reallocation of $55,000 from the General Manager’s budget contingency fund to the Public Outreach and Conservation Department’s FY 2018 and 2019 budget to implement the program.

9-6. Retirement of Director. The Board adopted Resolution No. 2018-02 honoring Yen Tu upon her retirement from the Board of Directors.

-47- -49- -50- -51- REVISED Item 7 Title Change

Regular Meeting of the Metro Commission and Metro Wastewater JPA

AGENDA

Thursday, March 1, 2018 12:00 p.m.

9192 Topaz Way (PUD MOC II) Auditorium San Diego, California

“The Metro JPA’s mission is to create an equitable partnership with the San Diego City Council and Mayor on regional wastewater issues. Through stakeholder collaboration, open dialogue, and data analysis, the partnership seeks to ensure fair rates for participating agencies, concern for the environment, and regionally balanced decisions.”

Note: Any member of the Public may address the Metro Commission/Metro Wastewater JPA on any Agenda Item. Please complete a Speaker Slip and submit it to the Administrative Assistant or Chairperson prior to the start of the meeting if possible, or in advance of the specific item being called. Comments are limited to three (3) minutes per individual.

Documentation Included 1. ROLL CALL

2. PLEDGE OF ALLEGIANCE TO THE FLAG

3. PUBLIC COMMENT Persons speaking during Public Comment may address the Metro Commission/ Metro Wastewater JPA on any subject matter within the jurisdiction of the Metro Commission and/or Metro Wastewater JPA that is not listed as an agenda item. Comments are limited to three (3) minutes. Please complete a Speaker Slip and submit it prior to the start of the meeting.

X 4. ACTION – CONSIDERATION AND POSSIBLE ACTION TO APPROVE THE MINUTES OF THE REGULAR MEETING OF November 2, 2017 (Attachment)

X 5. ACTION: CONSIDERATION AND POSSIBLE ACTION TO APPROVE THE METRO JPA MID-YEAR FINANCIAL STATEMENTS (SEVEN MONTHS ENDING JANUARY 31, 2018) (Attachment) (Kevin Woo)

X 6. ACTION: CONSIDERATION AND POSSIBLE ACTION TO APPROVE A CONTRACT WITH U.S. PEROXIDE, LLC. FOR PROPRIETARY PEROXIDE REGENERATED IRON-SULFIDE CONTROL PROGRAMS FOR WASTEWATER ODOR CONTROL AT VARIOUS CITY FACILITIES (Attachment) (Juan Guerreiro)

March 1, 2018 Metro Commission/Metro Wastewater JPA Regular Meeting Agenda -53- Documentation Included X 7. ACTION: CONSIDERATION AND POSSIBLE ACTION TO APPROVE A PURE WATER PHASE 2 ALTERNATIVE EVALUATION (Attachment) (Doug Owen)

X 8. ACTION: CONSIDERATION AND POSSIBLE ACTION TO APPROVE AN AS- NEEDED CONSTRUCTION MANAGEMENT SERVICES – CONVEYANCE PROJECTS AGREEMENT WITH CH2M HILL, INC. (Attachment) (John Helminski)

X 9. METRO TAC UPDATE/REPORT (Standing Item) (Attachment) (Greg Humora)

10. UPDATE FROM PURE WATER PROJECT EIR SUBCOMMITTEE (Standing Item) (Greg Humora)

11. CITY OF SAN DIEGO SECONDARY EQUIVALENCY LEGISLATION (Standing Item) (John Helminski)

X 12. PURE WATER PROGRAM UPDATE (Standing Item) (Attachment) (John Helminski)

13. IROC UPDATE (Jerry Jones)

14. PURE WATER AD HOC COMMITTEE UPDATE (Jerry Jones)

15. FINANCE COMMITTEE (John Mullin)

16. REPORT OF GENERAL COUNSEL (Paula de Sousa Mills)

17. PROPOSED AGENDA ITEMS FOR THE NEXT METRO COMMISSION/METRO WASTEWATER JPA MEETING April 5, 2018

18. METRO COMMISSIONERS’ AND JPA BOARD MEMBERS’ COMMENTS

19. ADJOURNMENT OF METRO COMMISSION AND METRO WASTEWATER JPA

The Metro Commission and/or Metro Wastewater JPA may take action on any item listed in this Agenda whether or not it is listed “For Action.”

Materials provided to the Metro Commission and/or Metro Wastewater JPA related to any open-session item on this agenda are available for public review by contacting L. Peoples at (619) 548-2934 during normal business hours.

March 1, 2018 Metro Commission/Metro Wastewater JPA Regular Meeting Agenda -54- In compliance with the AMERICANS WITH DISABILITIES ACT

The Metro Commission/Metro Wastewater JPA requests individuals who require alternative agenda format or special accommodations to access, attend, and/or participate in the Metro Commission/ Metro Wastewater JPA meetings, contact E. Patino at (858) 292.6321, at least forty-eight hours in advance of the meetings.

Metro JPA 2018 Meeting Schedule

January 4, 2018 February 1, 2018 March 1, 2018 April 5, 2018 May 3, 2018 June 7, 2018 July 5, 2018 August 2, 2018 September 6, 2018 October 3, 2018 November 1, 2018 December 6, 2018

March 1, 2018 Metro Commission/Metro Wastewater JPA Regular Meeting Agenda -55-

GENERAL MANAGER’S REPORT March 7, 2018

Information

1. Featured Article: ACWA Newsletter - “Advanced Water Purification East County Makes Progress in ACWA Region 10”

2. Featured Article: “San Diego Pursues Drought-Proof Water Supply”

3. News Article: “Bill beefing up dam inspections signed into law”

4. News Article: “’Cloud seeding’ may make it snow, but will it reduce droughts in the West?”

5. News Article: “Hidden ‘rock moisture’ possible key to forest response to drought”

6. News Article: “Santa Margarita Water District Breaks Ground on New Recycled Water Reservoir”

-57- SPOTLIGHT Advanced Water Purification East County Makes Progress in ACWA Region 10

PROGRAM FACTS Location East County, San Diego

Partner Agencies • Padre Dam Municipal Water District (lead agency) • Helix Water District • San Diego County • City of El Cajon

Goal Reduce current 100% reliance on imported water by up to 30% after 2025.

Benefits • Creates a new, local, reliable and drought proof- drinking water supply • Reduces East County’s The predecessors of today’s Padre Dam The program is a partnership between reliance on the City of Municipal Water District pioneered Padre Dam, Helix Water District, the San Diego’s Metropolitan modern water recycling during the late County of San Diego and the City of El Wastewater System. 1950s. Back then, what was the Santee Cajon. Padre Dam is currently the lead • Future cost will be County Water District received worldwide agency. If the project stays on schedule, competitive with imported water attention for a treatment process used work will proceed through two phases until • Repurposes water to create a chain of seven recycled water 2025, the target year for starting operations treatment byproducts for lakes. Today, that pioneering spirit flows and beginning to supply East County with beneficial use, including through the East County Advanced locally produced, sustainable, drought- electricity generation and Water Purification Program, where Padre proof drinking water. dust control Dam MWD and its partner agencies are • Sustains East County’s For now, the project’s embryonic operation deploying state-of-the-art wastewater economy and quality of life treats water at a demonstration facility. treatment technology. Eventually, they This pilot program produces approximately 2017 Numbers expect to meet up to 30% of current • 36 million gallons purified 100,000 gallons of purified water a day. drinking demands in East County, San at demonstration facility in This gives project managers an ongoing Diego — cutting their current 100% 2017 way to test the system’s capabilities and • More than 5,000 reliance on imported water from the check water quality against the public people had toured the Sacramento and Colorado rivers. demonstration facility health objectives necessary to earn since 2015 The seven bodies of water comprising the approval from the State Water Resources • Received $129 million in Santee Lakes remain a valuable recreation Control Board’s Division of Drinking state and federal grant and destination, with 300 campsites attracting Water. At the test facility, recycled water loan funding to date • Approximately 400,000 more than 750,000 visitors a year. The undergoes a four-step process that starts people will benefit from lakes generate enough revenue to make with free chlorine disinfection, continues the East County Advanced the recreational operation financially to membrane filtration, and then advances Water Purification Program independent. A generation later, the goal is to a reverse osmosis stage before advanced Website more water independence. Getting close to oxidation. From there the final advanced www.eastcountyawp.com the 30% benchmark drives progress on the oxidation process employs ultraviolent East County Advanced Water Purification light and hydrogen peroxide to destroy any Program. remaining organic compounds. -58- Opposite page: Lake Jennings was the site of testing that employed a remote control submarine from the Scripps Institution of Oceanography. Above left: A tour at the Advanced Water Purification Program’s demonstration facility. Above right: The demonstration facility employs a four-step, state-of-the-art process to produce purified water. Right: Lead Recycled Water Operator Ryan Hughes pours a glass of purified water at the demonstration facility.

The Advanced Water Purification East facility interacts with lake water. By 2023, “At Padre Dam, from County Demonstration Project was Padre Dam expects to build a pipeline funded by a Proposition 50 grant and did from its Advanced Water Purification our initial water not impact water rates. System that will deliver water to Lake Jennings. The lake will be one of the recycling project in “Through this process we can get 99.99 environmental buffers for the East percent disinfection of virus in a matter the 1960s to today’s County AWP Program. Additionally, of minutes,” said Al Lau, director of the program could also include injecting Advanced Water engineering for the Padre Dam Municipal water into a groundwater basin and add Water District, during an interview with Purification Program, natural filtration to the treatment process. San Diego’s NBC 7. “Water sustainability depends recycling water and The project has already taken a couple on innovative stewardship of this interesting and newsworthy turns. using our resources increasingly finite resource. At Padre During early 2017, Southern California Dam, from our initial water recycling wisely has become brewer Ballast Point created a batch of project in the 1960s to today’s Advanced its beer using purified water from the a generational Water Purification Program, recycling demonstration facility and served it at a water and using our resources wisely has commitment.” — Allen WateReuse Conference. WateReuse also become a generational commitment,” recognized the East County Advanced said Allen Carlisle, General Manager/ Carlisle, general Water Purification Program as its 2017 CEO. “Through hard work with our Agency/Program of the Year. Last manager/CEO, Padre partner agencies, the East County November, Scientists from Scripps Advanced Water Purification Program Dam Municipal Water Institution of Oceanography deployed will fulfill that commitment well into this a remote-controlled submarine in Lake District century.” . Jennings. This gave project partner Helix Water valuable data on how purified water from a proposed purification

-59- KPBS San Diego Pursues Drought-Proof Water Supply

Tuesday, February 13, 2018

By Tom Fudge

Credit: San Diego County Water Authority

Above: The Olivenhain Dam in San Diego County, shown in an undated photograph, is part of a network of water storage that can store 90,000 acre feet of water.

The desert-like grounds around the San Diego County Water Authority offices are dressed in a water-wise xeriscape of cacti and aloe. The sky is a monotone blue and — even though it’s January — the temperature is in the 80s.

Dennis Cushman, assistant general manager for the Water Authority, doesn’t look very comfortable in this setting in his dark wool suit. But when asked about the county’s water supply, he said he is actually feeling pretty good, because San Diego has plenty of water for 2018.

“We’d like to see more precipitation. But we’re prepared. And we spent billions of dollars and several decades preparing for years like this, and stretches of years like this,” Cushman said.

-60- Cushman’s confidence about the water supply says a lot following last year’s record dry June-to- December in San Diego. So far this rainy season only 1.7 inches have fallen at Lindbergh Field. Average rainfall this time of year is three times that much.

But thanks to Water Authority investments and steep price hikes for ratepayers, Cushman says San Diego has a diversified set of water sources and an impressive network of infrastructure that, last year, won an Achievement Award from the American Society of Civil Engineers.

“It‘s a series of reservoirs — new and expanded reservoirs — interconnecting pipelines and pump stations that allow us to store enough water for emergencies. About 90-thousand acre-feet of water," Cushman said. "That’s in case we get our supplies cut off from the north.”

An acre-foot of water is enough to serve two four-person households for a year in San Diego.

When Cushman speaks ominously of being cut off “from the north,” he’s mining a narrative that describes the days when San Diego was dependent on water from the Metropolitan Water District of Southern California (MWD). In the early 1990’s, nearly all of San Diego’s water supply came from the Los Angeles-based MWD, a wholesale agency that gets its water from the Colorado River and the Sacramento Bay Delta.

In 1991, California was in a devastating multi-year drought, and the MDW cut water supplies to San Diego by 30 percent. Luckily the gods intervened and a “miracle March” that year brought California a deluge of rain that put the San Diego region back on a safe footing. Since then San Diego County has been storing more water and getting it from a lot of places than just the MWD.

"The supply from Metropolitan used to be about 95 percent of our supply. Now it's down to about 40 percent of our supply," said Cushman.

Where else is water coming from? Figures from the County Water Authority show that last year approximately 40 percent came from the Metropolitan Water District. Another 38 percent came from a water transfer deal San Diego struck with the Imperial Irrigation District. The new ocean water desalination plant in Carlsbad provided nearly ten percent of the county’s water supply, and recycled water for irrigation accounted for 5 percent.

-61-

A graphic taken from a San Diego County Water Authority document showing the changing sources of the region's water supply.

One step beyond water recycling is sanitizing wastewater for drinking and it’s the next frontier of local water production. The County Water Authority expects potable reuse to provide 16 percent of local water by 2035.

Cleaning the water we’ve been throwing away

A water engineer stands near a series of ponds and a small water purification plant in western Santee. His name is Al Lau, with the Padre Dam Water District, and the plant is a demonstration project which he says is the beginning of a process that will lead to millions of gallons a day of purified wastewater.

Today the pipe that carries treated wastewater from East County to be dumped in the Pacific Ocean is just a couple miles away.

“We see all the wastewater flow past us, 14 million gallons a day, all the way to the Pacific Ocean. We see that as a wasted resource. We see the opportunity to capture that and turn that into a resilient water supply for our community,” Lau said.

At a cost of $460 million, Padre Dam wants to phase in a system that will eventually treat East County wastewater and make it clean enough to drink.

“We’re going to take all of that 14 million gallons of wastewater, generate a purified water supply and pump it into Lake Jennings,” he said. “That water, once it’s in Lake Jennings, will blend with other imported water supplies, where it will be treated again…and that water will be provided to the entire community of East County.”

-62- The City of San Diego Public Works Department is building an even bigger system of purifying wastewater. Spokesman Brent Eidson said they plan to eventually divert 100 million gallons a day from the Point Loma treatment plant and turn it into potable water. A San Diego City Council vote on the environmental review documents for the new facilities comes up in April. The cost of building phase one of the project is $1.3 billion.

The diversification of San Diego’s water supply has come at a cost. Since the early 1990s, the cost of an acre-foot of water has tripled even as per capita demand for water has dropped substantially.

Photo by Tom Fudge

Water engineer Al Lau stands next to the reverse osmosis pipes that purify wastewater at a demonstration project of the Padre Dam Municipal Water District. Feb. 12, 2018.

Water authorities justify the rising cost of water in a variety of ways. They cite growing populations and the cost of infrastructure maintenance. They predict that, over time, the cost of imported water will pull even with local water supplies. But for now, desalinated water - to cite one example - is twice the cost of imported water from the MWD. Even so, Dennis Cushman says there’s a reason for that.

“It’s way more reliable. So it’s not an apples-to-apples comparison. It’s the most reliable supply in our portfolio contrasted with the least reliable water supply, from the Bay Delta, that we get from Metropolitan,” Cushman said.

-63- The future of California water

The water supply for California can never be free from the cycle of rain and drought, not to mention the faster snowmelt and evaporation that comes with global warming. Marty Ralph is a meteorologist and director of the Center for Western Weather and Water Extremes at UC San Diego. He says California’s rainfall future may not be any more wet or dry - just more unpredictable.

“I do think the likely scenario for the future is a continuation of the very dynamic climate we’ve had here in California, which goes from very wet to very dry from year to year,” Ralph said. “The climate projections are saying that’s going to increase. The extremes are going to become greater. The papers I’m familiar with, the work we’re doing, all point in that direction.”

He said that means we need to predict weather patterns more precisely and make more effective use of our system of dams and reservoirs.

Photo credit: San Diego County Water Authority

The Carlsbad desalination plant, shown in this undated photograph, now provides nearly ten percent of San Diego County's water supply.

“We’re in the 21st century now. We need every drop of water to do more work for us than it used to,” he said, quoting a colleague. “So we need the systems, the knowledge, the science, the policies all to support that greater use and conservation of the water.”

That’s especially true in San Diego, which gets less rainfall than all of California’s ten largest cities, except for Bakerfield. Cushman said the last year San Diego's native water supply was sufficient to support our population was in 1946.

Source: http://www.kpbs.org/news/2018/feb/13/san-diego-pursuit-drought-proof-water-supply/

-64- The Union Bill beefing up dam inspections signed into law Jake Abbott Special to The Union February 26, 2018

Gov. Jerry Brown signed a bill into law Monday that will increase the frequency of inspections at the state's most at-risk dams and require the Department of Water Resources to update dam safety protocols. Assemblyman James Gallagher, R-Yuba City, authored Assembly Bill 1270 following the Lake Oroville spillway crisis last February that saw more than 180,000 people evacuate.

The bill was held up at the end of the Legislature's session in 2017, but Gallagher and other proponents were intent on seeing it through in 2018. It passed both the Senate and Assembly unanimously in early February and was sent to Brown for final approval on Feb. 15.

"I think this was a much needed move forward, and we are delighted to see the governor signed it into law," Gallagher said by phone on Monday. "There is still plenty to do, but this was one of the things we had to get right. This will ensure that our statute lays out the need for annual inspections at dams classified as significant hazard, and it will ensure that our reviews of dams include a deeper dive into things like geology and original design plans."

Before the bill, the statute required dam inspections "from time-to-time." Now, DWR must inspect all dams classified as "significant" hazard as least once per year, and "low" hazard dams at least once every two fiscal years. The new law will also set new standards for what must be done during an inspection. Lastly, it will require that all inspection reports are made available for public review.

-65- "The bill will take effect immediately and gets the ball rolling on improving dam safety protocols," Gallagher said. "I think it's definitely a good first step, but we still have other things we'd like to see happen."

Gallagher said he, along with the Oroville Dam Coalition, would like to see additional improvements at Lake Oroville that will ensure an event like last year's will never happen again. He said sediment still needs to be removed from the Feather River, and projects to reduce flood risk need to be seen through. He also said recreational opportunities need to be improved at Lake Oroville.

"The Oroville disaster jeopardized lives, property, and California's water supply and conveyance system," Gallagher said in a press release. "The silver lining is that the crises highlighted we must do more to ensure we are taking care of vital infrastructure, like the levees and dams that protect our communities. AB 1270 will help us do this by ensuring that California leads national and global efforts to update and modernize dam safety requirements."

Jake Abbott writes for the Marysville Appeal Democrat. He can be reached at [email protected].

Source: https://www.theunion.com/news/local-news/bill-beefing-up-dam-inspections-signed-into-law/

-66- The Washington Post

‘Cloud seeding’ may make it snow, but will it reduce droughts in the West?

“I’m just trying to make more snowflakes at a ski resort,” said Joe Busto, who oversees Colorado’s cloud seeding program. (Chelsea Self/Glenwood Springs Post Independent/AP) by Sophie Quinton Health & Science

February 26

CHEYENNE, Wyo. — Machines that prod clouds to make snow may sound like something out of an old science fiction movie. But worsening water scarcity, combined with new evidence that “cloud seeding” can work, is spurring states, counties, water districts and power companies across the thirsty West to use the strategy.

Last month, a study funded by the National Science Foundation tracked for the first time how the technology works in nature. The evidence for cloud seeding has been scarce, but recent research has encouraged officials and companies desperate to increase the amount of water in rivers and reservoirs.

In Colorado alone, more than 100 cloud seeding machines are set up in mountainside back yards, fields and meadows. Some older versions of the contraptions look like large tin cans perched on top of a

-67- propane tanks. New ones are large metal boxes festooned with solar panels, weather sensors and a slim tower.

Their goal is the same: to “seed” clouds with particles of silver iodide, a compound that freezing water vapor easily attaches to. That combination makes ice crystals form, which eventually become snowflakes.

Colorado’s program, which costs $1 million a year, is paid for not just by the state, ski resorts and local water users but also by water districts as far away as Los Angeles that want to increase snowmelt into the

Colorado River, which sustains more than 30 million people across the Southwest. Most of the river basin is experiencing a drought.

“Everyone starts to get nervous when there’s no snow in Colorado,” said Joe Busto, the scientist who oversees Colorado’s cloud seeding program.

Major urban water districts in Arizona, California and Nevada have funded cloud seeding in the Rocky

Mountains for more than 10 years and are now close to signing an agreement with officials in Colorado,

New Mexico, Utah and Wyoming to split the cost of nine more years of seeding.

Cloud seeding is a relatively cheap tool for bulking up the water supply in Lake Mead and other reservoirs, said Mohammed Mahmoud, a senior policy analyst for the Central Arizona Water Conservation District.

Yet it’s hard to tell how much additional precipitation cloud seeding creates. The process works only when there are freezing, moist clouds in the air. And the technology can be controversial.

“The whole thing is propaganda,” said Jamie Kouba, 32, a farmer from Regent, N.D., who argues that cloud seeding is decreasing rainfall in his area, rather than increasing it. He’s organizing local farmers in a campaign against the practice.

A 20th-century technology

Cloud seeding machines generate smoke that floats into the air like incense. Some state programs rely on ground-based machines. Others use airplanes to drop flares that generate silver iodide smoke into clouds, or to fly into a storm with flares strapped to their wings.

-68- The recent study, which was conducted in Idaho and published in the Proceedings of the National

Academy of Sciences, was the first to show real-world observations of silver iodide forming ice crystals inside clouds and falling out as snow.

Such research has increased interest in cloud seeding, particularly among private companies and utilities, said Neil Brackin, president of Weather Modification, a North Dakota company that does cloud seeding.

Other recent studies have used computer modeling to estimate the increase in snowfall from cloud seeding. A 2014 study across two Wyoming mountain ranges found that cloud seeding could increase snowfall by 5 to 15 percent — but only when the right conditions for seeding were met, or during 30 percent of snow events.

Relatively small increases still matter. “People in the western United States — we’re always water-stressed out here,” said Frank McDonough, an atmospheric scientist in Nevada who oversees the cloud seeding program at the Desert Research Institute, part of the state university system. Along the Colorado River, more water is promised to people than is available.

Nevada’s cloud seeding program can increase the snowpack by up to 10 percent, McDonough said.

That translates into 80,000 more acre-feet a year of water, enough to sustain about 150,000 households.

Still, he said, cloud seeding programs are difficult to evaluate. “Ten percent of additional snowfall is within the natural variation of storms.”

Idaho Power, which serves customers in Idaho and Oregon, has been using cloud seeding to boost the volume of water moving through its hydroelectric dams since 2003. The company’s representatives say the $3 million seeding program they oversee — which is partly funded by the state and other water users

— generates billions of gallons of additional water for much less than 1 percent of the company’s operational budget.

Still, Busto warns that cloud seeding isn’t a cure for drought. Take this winter, which has been too warm and too dry for seeding. “We have not been able to run our cloud seeding machines because there’s been no storms coming through,” he said; the machines have only run a handful of times so far.

-69- Busto said he has been confronted by people who are worried that exposure to silver iodide will make

them sick. But silver is a naturally occurring element that is not inherently harmful, he said. In the 2014

Wyoming study, scientists found that seeding added some silver iodide to the surrounding water and soil

but far too little to pose a known threat to human health.

North Dakota’s Kouba is one of the skeptics. He has compiled state rainfall data going back to the 1970s

and concluded that cloud seeding has decreased rainfall, particularly in counties that are downwind of

seeding operations. “I’m in a downwind county, and we have lost considerably,” he said.

North Dakota officials say there’s no evidence that cloud seeding caused last year’s drought. If anything,

cloud seeding in one place leads to more precipitation downwind, not less, said Darin Langerud, who

oversees cloud seeding for the North Dakota Atmospheric Resource Board.

Busto said actual science fiction — such as “Geostorm,” a 2017 movie about malfunctioning climate

control satellites — fuels misperceptions about what states are trying to do.

“Every time something like that comes out, it feeds more conspiracy theories,” he said. “I’m just trying to

make more snowflakes at a ski resort.”

Source: https://www.washingtonpost.com/national/health-science/cloud-seeding-may-make-it-snow-but-will-it-reduce-droughts-in-the- west/2018/02/23/88efeafe-1675-11e8-92c9-376b4fe57ff7_story.html?utm_term=.658624686306

-70- Science Daily Hidden 'rock moisture' possible key to forest response to drought Underground rock reservoirs can hold significant amounts of water. Date: February 26, 2018 Source: National Science Foundation Summary: A little-studied, underground layer of rock may provide a vital reservoir for trees, especially in times of drought, report scientists.

Scientists have found underground water reservoirs that can mitigate drought effects.

Credit: USFS

A little-studied, underground layer of rock may provide a vital reservoir for trees, especially in times of drought, report scientists funded by the National Science Foundation (NSF) and affiliated with The University of Texas (UT) at Austin and the University of California, Berkeley.

The study, published today in the journal Proceedings of the National Academy of Sciences (PNAS), looked at the water stored inside the layer of weathered bedrock that lies under soils in mountain forest ecosystems. This transitional zone beneath soils and above groundwater is often overlooked when it comes to studying hydrologic processes, but researchers found that the water contained in the fractures and pores of the rock could play an important role in the water cycle at local and global levels.

-71- "There are significant hydrologic dynamics in weathered bedrock environments, but traditionally they are not investigated because they are hard to access," said lead PNAS author Daniella Rempe, a geoscientist at UT Austin. "Our study was designed to investigate this region." Researchers found that water in bedrock can sustain trees through droughts even after the soil has become parched. At a field site in Northern California's Mendocino County, scientists found that up to 27 percent of annual rainfall was stored as "rock moisture," the water clinging to cracks and pores in the bedrock. The impact of rock moisture varies, the researchers said, depending on region and topography. But it likely explains why trees in the study area showed little effect from the severe 2010-2015 drought, which killed more than 100 million trees throughout California. "How trees can survive extended periods of severe drought has been a mystery," said Richard Yuretich, director of NSF's Critical Zone Observatory (CZO) program. The research was conducted at the NSF Eel River Critical Zone Observatory, one of nine NSF CZO research sites across the country. "This study reveals a significant reservoir of trapped water that had gone unnoticed in the past," says Yuretich. "Research of this kind can help greatly in managing natural resources during times of environmental stress." To conduct the study, scientists monitored rock moisture from 2013 to 2016 at nine wells drilled into weathered bedrock along a steep, forested hillside. They used a neutron probe, a precision tool that measures the amount of water in a sample area by detecting hydrogen. They found that the weathered rock layer built up a supply of 4 to 21 inches of rock moisture during the winter wet season, depending on the well. The maximum amount of rock moisture in each well stayed about the same throughout the study period, which included a significant drought year. The finding indicates that the total rainfall amount does not influence the rock moisture levels. "It doesn't matter how much it rains in the winter; rock moisture builds up to the same maximum value," Rempe said. "That leads to the same amount of water being available every summer for use by trees." Researchers also found that the average rock moisture at all wells exceeded the average soil moisture measurements at all locations. "Soils are important, but when it comes to determining if a place is going to experience water stress, it could be the underlying rock that matters most," Rempe said. "This is the first time this has been demonstrated in a multi-year field study." The potential for rock moisture to travel back to the atmosphere by evaporation from tree leaves or to trickle down into groundwater indicates that it could affect the environment and climate on a larger scale. The study provides a glimpse into rock moisture at a small, intensive research site, according to paper co-author William Dietrich of the University of California, Berkeley. He said the data collected during the study should be a starting point for more research. "The future paths are many. Now we have just one well-studied site." The research was also supported by the Keck Foundation and the University of California Reserve System. Source: https://www.sciencedaily.com/releases/2018/02/180226181606.htm

-72- ACWA Santa Margarita Water District Breaks Ground on New Recycled Water Reservoir

• BY JIM LEACH • FEB 22, 2018

RANCHO SANTA MARGARITA, CALIF. (February 22, 2017) – The Santa Margarita Water District (“SMWD”) hosted a groundbreaking for its new 5,000 acre foot Trampas Canyon Recycled Water Reservoir in south Orange County. The SMWD Board of Directors approved the $123 million project in November, 2017. The new reservoir will enable SMWD to collect and store up to sixty percent of the treated water from its Chiquita Water Reclamation Plant doubling the District’s overall recycled storage capacity and ensuring greater year-round water reliability throughout the District’s service area. It will be the largest surface reservoir constructed in south Orange County in the past twenty years. The costs of the project will be paid utilizing a combination of Proposition 1 State grant funds, a low-interest State loan through the State Water Resources Control Board and future Community Facilities Districts (CFDs) assessments.

According to the District, the new reservoir will allow SMWD to store much of its treated recycled water during the cooler months of the year for use during the Spring and Summer months when demand is high. The new reservoir will help the District reach its goals for water recycling and reuse and will provide for the development of new recycled water uses and the reduction of dependence on imported water.

Earlier this year, the SMWD Board finalized its agreement with Rancho Mission Viejo LLC (The Ranch), owners of the historic 23,000-acre Rancho Mission Viejo cattle ranch, habitat reserve and master planned community, for the land where the reservoir will be constructed. The site is located southeast of the intersection of Antonio Parkway and Ortega Highway in unincorporated Orange County adjacent to an existing industrial sands enterprise.

Source: https://www.acwa.com/news/santa-margarita-water-district-breaks-ground-new-recycled-water-reservoir/

-73- Meeting Date: 3/7/2018 Dept. Head: Karen Jassoy Submitted by: Kevin Woo Department: Finance

BOARD AGENDA REPORT Approved by: Allen Carlisle, GM

SUBJECT: FINANCE AND TREASURER'S REPORT FOR THE SEVEN MONTHS ENDED JANUARY 31, 2018

RECOMMENDATION(S):

Note and File: Finance and Treasurer's Report for the Seven Months Ended January 31, 2018

ALTERNATIVE(S):

1. None. For information only.

ATTACHMENT(S):

1. Monthly Financial Statements and Treasurer’s Report

FUNDING:

Requested amount: n/a Budgeted amount: Are funds available? Yes No Project cost to date:

PRIOR BOARD/COMMITTEE CONSIDERATION:

STRATEGIC PLAN IMPLEMENTATION:

-75-

EXECUTIVE SUMMARY:

Pursuant to California Government Code Section 53646 and the District Standard Practices and Policies Manual, Section 19.2, Investment Policy, the Board is to receive monthly reports of the summary of financial operations, cash balances and investments.

RECOMMENDATION(S):

NOTE AND FILE: Finance and Treasurer’s Report for the Seven Months Ended January 31, 2018.

Page 2 of 2 -76- Attachment 1

PADRE DAM MUNICIPAL WATER DISTRICT

MONTHLY FINANCIAL STATEMENTS

January 31, 2018

Summary Fact Sheet ...... Page 1

Notes to Financial Statements ...... Page 2-A/B

Statement of Net Position ...... Page 3

Statement of Cash Flows ...... Page 4

Summary of Operations ...... Page 5 Graph of Operating Revenues & Expenses Page 5 - A Retail Page 5 - B Monthly Water Consumption Page 5 - B - 1 Monthly Water Consumption - Graph Page 5 - B - 2 Cumulative Water Consumption - Graph Page 5 - B - 3 Water Reclamation Page 5 - C Monthly Water Consumption Page 5 - C - 1 Sewer Page 5 - D Park Page 5 - E Park Supplementary P & L Page 5 - E - 1 Park Statistical Data Page 5 - E - 2

Departmental Expenditures ...... Page 6 Departmental Expenses Variances - Actual to Budget Page 6 - A Budget Notes to Operating Expenses Page 6 - B

Legal Expenses ...... Page 7

Contract Services ...... Page 8

Organizational Staffing ...... Page 9

Major Construction Projects ...... Page 10

Overtime ...... Page 11

Treasurer's Report ...... Page 12 - 18

-77- PADRE DAM MUNICIPAL WATER DISTRICT SUMMARY FACT SHEET

FOR SEVEN MONTHS ENDING JANUARY 31, 2018

PRIOR YR YEAR TO DATE ACTUAL ACTUAL BUDGET VARIANCE %

Total Operating Revenues $ 41,560,730 $ 44,010,693 $ 39,917,892 $ 4,092,801 10. 3

Total Direct Costs 13,964,735 14,791,588 13, 439,771 (1,351,817) (10.1)

Revenues Available for Ops 27,595,995 29,219,105 26, 478,121 2,740,984 10. 4

Total Operating Expenses 21,797,473 22,041,535 23, 775,294 1,733,759 7.3

Income (Loss) fm Ops 5,798,522 7,177,570 2,702,827 4,474,743 165.6

Total Non Op Income (Exp) (1,572,022) (1,203,925) (1,023,422) (180,503) (17.6)

Change in Net Position $ 4,226,500 $ 5,973,645 $ 1,679,405 $ 4,294,240 255.7

Legal Expenses (Non-Litigation) $ 48,607 $ 43,937 $ 180,323 $ 136,386 75.6%

Contract & Professional $ 2,984,459 $ 2,032,849 $ 3, 140,341 $ 1,107,492 35.3%

Overtime $ 117,671 $ 138,063 $ 90, 504 $ (47,559) -52.5%

Major CIP Projects $ 3,250,098 $ 10,347,513 $ 13,520,835 $ 3,173,322 23.5%

Departmental Expenses $ 17,507,343 $ 17,471,973 $ 19,394,334 $ 1,922,361 9.9%

Cash & Investments - Unrestricted $ 70,378,369 $ 82,781,954 $ 67,411,280 $ 15,370,674 22.8%

Cash & Investments - Restricted $ 23,917,339 $ 18,835,018 $ 13,088,513 $ 5,746,505 43.9%

Staffing 142.0 139.1 135.7 ( 3.4) -2.5%

Sales in Acre Feet - Retail 5,633 6,079 5,408 671 12.4%

Page 1 -78- Padre Dam Municipal Water District Notes to the Financial Statements Seven Months Ending 1/31/18 Page No. Director of Finance Summary: For the seven months ending January 31, 2018, Padre Dam had a net gain of $6.0M, primarily due to the water and sewer operations. Excluding depreciation, these results contributed $11.2M of cash towards the Capital Replacement Funds (CRF) while actual net spending from CRF was $7.4M. This results in contribution exceeding spending by $3.8M. CRF fund balance is $55.8M. CIP spending is at 44.6% of budget. (The Board approved minimum fund balance for CRF is $18.4M.) The remaining proceeds from issuance of the 2009 COP were invested in a series of CD’s that matured in October. The proceeds were transferred to the District’s unrestricted funds in December to reimburse the District for approved expenditures.

Page 5 Combined Change in Net Position: The change in net position of $6.0M is favorable to budget by $4.3M (255.7%). This variance consists of $4.4M favorable variance from operations and $181K unfavorable variance from non-operating activity. Favorable variance in gross profit of $2.7M and $1.7M favorable variance from Padre Dam internal operating expenses (net) generated the $4.4M favorable variance from operations.

Page 5 Total Operating Revenues: Combined Operating Revenues of $44.0M are favorable to budget by $4.1M or 10.3%. Water sales are favorable to budget by 12.3%. Sewer sales are favorable to budget by 9.2%.

Page 5 Direct Costs: Direct costs incurred of $14.8M are unfavorable to budget by $1.4M (10.1%) mostly due to water purchases being $672K higher than budget. Energy purchases are $144K higher than budgeted. Water purchases are 7.4% higher than budget. Energy billings have exceeded energy purchases by $36K. (Cost of electricity is about 15.0 cents/KWH vs. 12.0 cents/KWH budgeted.) A 4% “water shrinkage” was budgeted and shrinkage of up to 3% to 5% is considered normal.

Page 5 Internal Operating Expenses: Combined Operating Expenses of $22.0M are $1.7M favorable to budget. All categories are favorable to budget except for materials/repairs and depreciation expense.

Page 5 Non-Operating Activity: Non-Operating Activity (net) is $181K unfavorable to budget. Net interest expense was favorable to budget by $162K. There was an unrealized loss on investments. Gains and losses are not budgeted because they are hard to predict.

Page 4, Cash & Investments Balances: Total cash & investments at month end is $101.6M Page 15 and includes $18.8M of restricted funds and $82.8M of designated and other funds. Total cash & investments have increased $2.5M from the beginning of the fiscal year.

2-A

-79- Page 5 $72,285,742 - Combined Designated Fund Balance: On a combined basis, the Board designated fund is higher by $6.6M for the seven months ending January 31, 2018; Rate Stabilization fund balance is $16.5M and has increased by $1.1M. Capital Replacement fund balance is $55.8M and has increased by $5.5M. The increase includes the transfer of the remaining proceeds from the 2009 COP.

Page 5b $36,161,567 - Retail Fund Balance: Retail operating funds have increased by $4.0M. Rate Stabilization funds have increased by $434K while Capital Replacement funds have increased by $3.6M. The increase includes the transfer of the remaining proceeds from the 2009 COP.

Page 5c $12,149,186 – Water Recycling Fund Balance: Water Recycling operating funds have increased by $1.1M. Rate Stabilization funds have increased by $378K while Capital Replacement funds have increased by $680K.

Page 5d $20,339,377 - Sewer Fund Balance: Sewer operating funds have increased by $2.0M. Rate Stabilization funds have increased by $265K while Capital Replacement funds have increased by $1.7M.

$3,635,612 - Park Fund Balance: Park operating funds have decreased by $497K. Page 5e The Rate stabilization funds were unchanged from the beginning of the year while the Capital Replacement funds have decreased by $497K.

Park operating revenues of $3.5M are $183K (5.6%) favorable to budget. The actual Page 5e, camping revenues are higher than budget by $73K. Actual operating expenditure 5e1, 5e2 levels are favorable to budget by $189K (6.7%), which combines to produce $584K actual net gain, favorable by $544K to the YTD gain predicted in the budget of $40K. A $346K net gain is predicted in the 2017-18 budget.

Page 4 Retiree Health/Life Benefit-Set Aside: GASB No. 45 requires that any unfunded liability for other post-employment benefits (Post-Retirement Health Benefits) be disclosed in the annual financial statements beginning with fiscal year ending 6/30/09. Based on the latest actuarial study as of June 30, 2015, PDMWD had a total actuarial accrued liability of $26.7 million, of which $11.0M has been funded. The Board approved a staff proposed plan to fund this obligation consistent with GASB No. 45. All funding is placed in a trust fund with CalPERS to meet GASB requirements. This leaves $15.7M as the unfunded actuarial accrued liability, which is being funded over a 30-year amortization period in accordance with GASB No. 45.

2-B

-80- PADRE DAM MUNICIPAL WATER DISTRICT Statement of Net Position All District Operations

Unaudited Unaudited January 31, 2018 June 30, 2017 Change ASSETS Preliminary J Current Assets Cash & Investments $ 82,781,954 $ 76,618,760 $ 6,163,194 Current Restricted Cash & Investments 508,080 508,080 - Accounts Receivable 5,191,303 6,349,119 (1,157,816) Other Current Assets 1,558,064 1,317,465 240, 599 Total Current Assets 90,039,401 24.3% 84,793,424 23.4% 5,245,977

Restricted Assets Cash & Investments 18,326,938 21,949,887 (3,622,949) Accrued Interest Receivable 11,293 11,293 - Total Restricted Assets 18,338,231 5.0% 21,961,180 6.1% (3,622,949)

Property, Plant and Equipment Property, Plant and Equipment 349,920,157 348,910,684 1, 009,473 Work in Progress 30,292,446 20,886,290 9, 406,156 Less: Accumulated Depreciation (123,260,570) (119,073,407) (4,187,163) Total Property, Plant and Equipment 256,952,033 69.4% 250,723,567 69.2% 6,228,466

Total Assets 365,329,665 98.7% 357,478,171 98.7% 7,851,494

DEFERRED OUTFLOWS OF RESOURCES Debt Issuance Costs & Deferred Amount on Refunding 114,382 114,382 - Pension Annual Required Contribution 4,672,291 4,672,291 - Total Deferred Outflows of Resources 4,786,673 1.3% 4,786,673 1.3% -

LIABILITIES Current Liabilities 13,509,196 12,801,519 707,677 Long Term Debt 56,622,728 60,004,121 (3,381,393) Other Noncurrent Liabilities 6,091,576 1,540,176 4,551,400 Pension Liability (Net) 38,647,017 38,647,017 - Total Liabilities 114,870,517 31.0% 112,992,833 31.2% 1,877,684

DEFERRED INFLOWS OF RESOURCES Penion net Difference on Projected & Actual Earnings (7,738) (7,738) - Total Deferred Outflows of Resources (7,738) 0.0% (7,738) 0.0% -

NET POSITION Investment in Capital Assets, net 206,886,120 201,231,766 5,654,354 Restricted 2,231,254 6,340,037 (4,108,783) Unrestricted 46,136,187 41,707,937 4, 428,250 Total Net Position $ 255,253,561 69.0% $ 249,279,740 68.8% $ 5,973,822

Page 3 -81- PADRE DAM MUNICIPAL WATER DISTRICT STATEMENT OF CASH FLOWS FOR SEVEN MONTHS ENDING JANUARY 31, 2018

Other Water Total Restricted Restricted Non-Operating Non-Operating Grand Retail Recycling Sewer Park Designated CEF/Other COP Woodside/LWD METRO Total

Page 5B Page 5C Page 5D Page 5E Page 3 Page 5

Beginning Cash & Investments 32,107,638 11,092,201 18,372,992 4,132,169 65,705,000 8,262,715 14,195,252 0 10,913,759 99,076,727

Cash Provided (Used) from Operations:

Change in Net Position 4,473,279 712,448 1,126,231 584,418 6,896,376 (638,252) - (284,479) - 5,973,645

Add Back Depreciation 2,885,046 505,569 701,102 477,845 4,569,562 - - - - 4,569,562 Change in Short Term Liabilities* 458,709 67,245 181,722 - 707,677 - - - - 707, 677 Change in Current Assets* 594,531 87,156 235,530 - 917,217 - - - - 917, 217 Change in Deferred Amount on Refunding (discount on debt) ------Change in Debt Issuance Costs (COI on debt) ------Change in Deferred Inflow/Outflow on Pension (Net) ------Cash Provided (Used) from Operations 8,411,565 1,372,418 2,244,585 1,062,263 13,090,832 ( 638,252) - ( 284,479) - 12,168,101 Cash Provided (Used) from Other Sources: Change in Long Term Borrowings: Notes Payable (2,777,055) (211,389) - (392,948) (3,381,393) - - - - (3,381,393) Other Noncurrent Liabilities* 1,518,873 222,662 601,717 - 2,343,252 2,208,148 - - - 4,551,400 Contributed Capital ------Transfers * (184,396) (27,032) ( 73,051) - ( 284,479) - - 284,479 - (0) Transfer from Woodside Sale proceeds for Ops Ph II ------Transfers 2009 COP ------Transfer of LWD portion of CRF ------Transfer Debt Service (2009 COP) 4,750,000 - - - 4,750,000 - (4,750,000) - - - Transfers - Other (METRO) 280,992 19,459 117,091 - 417,543 - - - ( 417,543) - Transfers - Other (2,500,033) - - - (2,500,033) 2,500,033 - - - - Cash Provided (Used) from Other Sources 1,088,381 3,700 645,758 ( 392,948) 1,344,890 4,708,181 (4,750,000) 284,479 ( 417,543) 1, 170,007 -82- Total Cash Provided (Used) 9,499,946 1,376,118 2,890,343 669,314 14,435,722 4,069,928 (4,750,000) - (417,543) 13,338,108 Uses of Cash for Property Acquisition: Property, Plant & Equipment from CIP (474,873) (441,179) (200,461) - ( 1,116,513) - - - - (1,116,513) Capitalized Contributed Capital ------Capital Equipment Purchases * (178,484) (26,165) ( 70,708) - ( 275,358) - - - (275,358) Disposals* 247,867 36,336 98,195 - 382,398 - - 382, 398 Net Change in CIP (405,490) (431,008) (172,975) - ( 1,009,473) - - - - (1,009,473) Change in Accumulated Depreciation due to disposals (247,867) (36,336) ( 98,195) - ( 382,398) - - - - (382,398)

CIP Capitalization 474,873 441,179 200,461 - 1,116,513 - - - - 1, 116,513 Construction in Progress (5,267,534) (292,969) (853,251) ( 1,165,871) ( 7,579,625) (2,942,879) - - - ( 10,522,504) CIP expensed ------Net Change in WIP (4,792,662) 148,210 (652,790) ( 1,165,871) ( 6,463,112) (2,942,879) - - - (9,405,991)

Uses of Cash for Property Acquisition (5,446,019) (319,134) (923,959) (1,165,871) (7,854,983) (2,942,879) - - - (10,797,862)

Total Uses of Cash (5,446,019) (319,134) (923,959) (1,165,871) (7,854,983) (2,942,879) - - - (10,797,862)

Park CS Fund Transfer (1) (0) (0) - (2) 2 - - - (0)

Net Change in Cash & Investments 4,053,926 1,056,984 1,966,383 (496,557) 6,580,737 1,127,051 (4,750,000) - (417,543) 2,540,246

Ending Cash & Investments 36,161,565 12,149,185 20,339,375 3,635,612 72,285,737 9,389,766 9,445,252 0 10,496,216 101,616,972

* Note: Allocation (of changes in receivables/payables/other assets) are based upon a constant percentage (overhead allocation percentage) applied throughout the fiscal year.

Page 4 PADRE DAM MUNICIPAL WATER DISTRICT STATEMENT OF OPERATIONS FOR SEVEN MONTHS ENDING JANUARY 31, 2018

VARIANCE PRIOR YR Y E A R - TO - D A T E BUDGET PRIOR YR ACTUALS A C T U A L B U D G E T Favor/(Unfavor) Favor/(Unfavor) Income (Loss) from Operations: $ $ % $ % $ % $ % Revenues: Water Sales $ 17,990,903 $ 19,954,146 45.3 $ 17,768,069 44.5 $ 2,186,077 12.3 $ 1,963,243 10.9 Infrastructure Access Charge 512,495 534,484 1.2 5 29,375 1.3 5,109 1.0 2 1,989 4.3 Energy Billings 834,999 903,684 2.1 7 24,469 1.8 179,215 24.7 6 8,685 8.2 CWA/ Metro Credits 245,970 115,900 0.3 2 60,571 0.7 (144,671) (55.5) (130,070) ( 52.9) Padre Dam Sewer Processing Fee 1,389,045 622,349 1.4 6 22,349 1.6 - - (766,696) ( 55.2) Sewer Revenues 9,445,298 9,872,797 22.4 9,042,208 22.7 830,589 9.2 427,499 4.5 System Charges 5,494,314 5,953,978 13.5 5,480,452 13.7 473,526 8.6 459,664 8.4 Park Fees 3,228,216 3,461,203 7.9 3,278,631 8.2 182,572 5.6 232,987 7.2 Property taxes subvention 1,652,487 1,902,785 4.3 1,638,553 4.1 264,232 16.1 250,298 15.1 Other Revenues 767,003 689,367 1.6 5 73,216 1.4 116,151 20.3 (77,636) ( 10.1) Total Operating Revenues 41,560,730 44,010,693 100.0 39,917,892 100.0 4,092,801 10.3 2,449,963 5.9

Direct Costs: Water Purchases 8,765,500 9,747,167 22.1 9,074,945 22.7 (672,222) ( 7.4) (981,667) ( 11.2) Infrastructure Access Charge 513,055 533,229 1.2 5 29,375 1.3 ( 3,854) ( 0.7) (20,174) (3.9) Energy Purchases 770,313 867,989 2.0 7 24,469 1.8 (143,520) (19.8) (97,676) ( 12.7) Sewer METRO Costs 2,330,388 2,829,191 6.4 2,286,606 5.7 (542,585) (23.7) (498,803) ( 21.4) Padre Sewer Treatment 1,389,045 622,349 1.4 6 22,349 1.6 - - 766,696 55.2 Fish Stock/Propane 196,434 191,663 0.4 2 02,027 0.5 10,364 5.1 4,771 2.4 Total Direct Costs 13,964,735 14,791,588 33.6 13,439,771 33.7 (1,351,817) (10.1) (826,853) (5.9)

Revenues Available for Operating Expenses 27,595,995 29,219,105 66. 4 26,478,121 66. 3 2,740,984 10.4 1,623,110 5.9

Operating Expenses: Salary & Wages 7,116,176 6,834,172 15.5 7,313,156 18.3 478,984 6.5 282,004 4.0 Employee Benefits 4,444,884 4,470,497 10.2 4,699,040 11.8 228,543 4.9 (25,613) (0.6) Professional Services 2,984,459 2,032,849 4.6 3,140,341 7.9 1,107,492 35.3 951,610 31.9 Materials, Supplies, Vehicle & Building 2,306,925 3,399,802 7.7 3,018,860 7.6 (380,942) (12.6) (1,092,877) ( 47.4) Administrative Expenses 790,430 921,694 2.1 1,079,521 2.7 157,827 14.6 (131,264) ( 16.6) Utilities 932,697 950,419 2.2 9 86,855 2.5 36,436 3.7 (17,722) (1.9) Billing Credits (1,068,228) (1,137,460) (2.6) (843,439) (2.1) 294,021 34.9 6 9,232 6.5 Subtotal 17,507,343 17,471,973 39.7 19,394,334 48.6 1,922,361 9.9 35,370 0.2 Depreciation/Amort 4,290,130 4,569,562 10.4 4,380,960 11.0 (188,602) (4.3) (279,432) (6.5) Total Operating Expenses 21,797,473 22,041,535 50.1 23,775,294 59.6 1,733,759 7.3 (244,062) (1.1)

Income (Loss) from Operations 5,798,522 7,177,570 16.3 2,702,827 6.8 4,474,743 165.6 1,379,048 23.8

Non Operating Activity Interest Expense (1,600,871) (1,391,259) (3.2) (1,140,089) (2.9) (251,170) (22.0) 209,612 13.1 Interest Income (Non CEF) 255,847 450,301 1.0 87,500 0.2 362,801 414.6 194,455 76.0 Interest Income (CEF/Restricted) 45,149 79,465 0.2 29,167 0.1 50,298 172.5 3 4,316 76.0 Gain/Loss on Sale of Fixed Assets 26,422 43,922 0.1 - - 43,922 n/a 17,500 66.2 Gain/Loss on Investments (298,569) (386,354) (0.9) - - (386,354) n/a (87,785) ( 29.4) Other Income/(Expense) - - - - - n/a - #DIV/0!

Total Non Operating Income (Expenses) (1,572,022) (1,203,925) (2.7) (1,023,422) (2.6) (180,503) (17.6) 368,097 23.4

Change in Net Position $ 4,226,500 $ 5,973,645 13. 6 $ 1,679,405 4.2 $ 4,294,240 255.7 $ 1,747,145 41.3

DESIGNATED CASH & INVESTMENTS Prior Yr Current Yr Rate Stabilization Capital Replacement

Balance 07/01 57,005,913 65,705,005 15,427,938 50,277,067

Change in Net Position 4,818,760 6,896,376 Add Back Depreciation/Amort 4,290,130 4,569,562 Changes in Payables/Receivables, Other 1,699,742 3,968,146 Cash Generated from Operations 10,808,632 15,434,084 15,434,084 -

CIP/Capital Equip (3,836,989) ( 7,854,983) (7,854,983) Debt Principal (2,540,211) (3,381,393) (3,381,393) Transfers to CRF fm Rate Stab - - (11,201,617) 11,201,617 Interest Income Transfer - - (264,321) 264,321 Cash Used for Property Acquisition & Debt (6,377,200) (11,236,376) (11,465,938) 229,562

Financing/Contrib Capital/Other Transfers (2,770,919) 2,383,029 (2,892,502) 5,275,531

Net Change in Cash & Investments 1,660,512 6,580,737 1,075,644 5,505,093

Balance 01/31 58,666,425 72,285,742 16,503,581 55,782,160

Board Minimum Fund Targets: 32,004,535 13,653,486 18,351,049

Copy of Jan18_BasedOnJun17PreliminaryJ.xlsx Page 5 -83- PADRE DAM MUNICIPAL WATER DISTRICT Monthly Financial Statements FOR SEVEN MONTHS ENDING JANUARY 31, 2018

INCOME REVENUE FROM OPERATIONS

Sewer Revenues 0 Water Sales 24% 45%

All Other 3%

System Charges Energy Billings 14% 2%

Property Taxes Park Fees 4% 8%

OUTGO OPERATING EXPENSES All Other Costs 12%

Materials, Supplies 10%

Water Purchases 29%

Employee Benefits 13% Sewer Costs 10%

Salary & Wages 21%

Other Direct Costs Energy Purchases 2% 3%

Page 5-A -84- PADRE DAM MUNICIPAL WATER DISTRICT STATEMENT OF OPERATIONS FOR SEVEN MONTHS ENDING JANUARY 31, 2018

VARIANCE

RETAIL PRIOR YR Y E A R - TO - D A T E BUDGET PRIOR YR ACTUALS A C T U A L B U D G E T Favor/(Unfavor) Favor/(Unfavor) Income (Loss) from Operations: $ $ % $ % $ % $ % Revenues: Water Sales $ 16,537,596 $ 18,367,829 65.1 $ 16,307,215 64.9 $ 2,060,614 12.6 $ 1,830,233 11.1 Infrastructure Access Charge 512,495 534,484 1.9 529,375 2 .1 5,109 1.0 21,989 4.3 Energy Billings 834,999 903,684 3.2 724,469 2 .9 1 79,215 24.7 68,685 8.2 CWA/ Metro Credits ------Padre Dam Sewer Processing Fee ------Sewer Revenues ------System Charges 5,386,430 5,834,342 20.7 5,377,783 21.4 4 56,559 8.5 447,912 8.3 Park Fees ------Property taxes subvention 1,652,487 1,902,785 6.7 1,638,553 6 .5 2 64,232 16.1 250,298 15.1 Other Revenues 761,838 685,007 2.4 564,200 2 .2 1 20,807 21.4 (76,831) (10.1) Total Operating Revenues 25,685,845 28,228,131 100.0 25,141,595 100.0 3,086,536 12. 3 2,542,286 9.9

Direct Costs: Water Purchases 8,765,500 9,747,167 34.5 9,074,945 36.1 (672,222) (7.4) ( 981,667) (11.2) Infrastructure Access Charge 513,055 533,229 1.9 529,375 2 .1 (3,854) (0.7) (20,174) (3.9) Energy Purchases 770,313 867,989 3.1 724,469 2 .9 (143,520) (19.8) (97,676) (12.7) Sewer METRO Costs ------Padre Sewer Treatment ------Fish Stock/Propane ------Total Direct Costs 10,048,868 11,148,385 39.5 10,328,789 41.1 (819,596) (7.9) (1,099,517) (10.9)

Revenues Available for Operating Expenses 15,636,977 17,079,746 60.5 14,812,807 58.9 2,266,939 15. 3 1,442,769 9.2

Operating Expenses: Salary & Wages 4,005,283 3,835,445 13.6 4,123,742 16.4 2 88,297 7.0 169,838 4.2 Employee Benefits 2,475,887 2,500,116 8.9 2,615,377 10.4 1 15,261 4.4 (24,229) (1.0) Professional Services 1,875,318 1,266,113 4.5 1,986,685 7 .9 7 20,572 36.3 609,204 32.5 Materials, Supplies, Vehicle & Building 1,103,737 1,735,707 6.1 1,485,589 5 .9 (250,119) (16.8) ( 631,970) (57.3) Administrative Expenses 448,596 544,561 1.9 402,761 1 .6 (141,799) (35.2) (95,965) (21.4) Utilities 71,336 68,806 0.2 115,422 0 .5 46,616 40.4 2,530 3.5 Billing Credits (637,298) ( 684,068) (2.4) ( 504,237) (2.0) 1 79,831 35.7 46,771 7.3 Subtotal 9,342,861 9,266,681 32.8 10,225,340 40.7 9 58,659 9.4 76,180 0.8 Depreciation/Amort 2,729,802 2,885,046 10.2 2,857,950 11.4 (27,097) (0.9) ( 155,244) (5.7) Total Operating Expenses 12,072,663 12,151,727 43.0 13,083,290 52.0 931,562 7.1 (79,065) (0.7)

Income (Loss) from Operations 3,564,314 4,928,019 17.5 1,729,517 6.9 3,198,502 184. 9 1,363,704 38.3

Non Operating Activity Interest Expense (1,066,870) (609,212) (2.2) ( 231,665) (0.9) (377,548) (163.0) 457,658 42.9 Interest Income 87,766 154,473 0.5 29,167 0 .1 1 25,306 4 29.6 66,706 76.0 Gain/Loss on Sale of Fixed Assets ------Other Income/(Expense) ------#DIV/0!

Total Non Operating Income (Expenses) (979,104) (454,739) (1.6) (202,498) (0.8) (252,241) (124.6) 524,364 53.6

Change in Net Position $ 2,585,211 $ 4,473,279 15.8 $ 1,527,019 6.1 $ 2,946,260 192. 9 $ 1,888,068 73.0

RETAIL CASH & INVESTMENTS Prior Yr Current Yr Rate Stabilization Capital Replacement

Balance 07/01 21,023,497 32,107,641 6,454,011 25,653,629

Change in Net Position 2,585,211 4,473,279 Add Back Depreciation/Amort 2,729,802 2,885,046 Changes in Payables/Receivables, Other 1,101,756 2,572,113 Cash Generated from Operations 6,416,769 9,930,438 9,930,438 -

CIP/Capital Equip (2,647,418) (5,446,019) (5,446,019) Debt Principal (1,196,518) (2,777,055) (2,777,055) Transfers to CRF fm Rate Stab - - ( 7,267,186) 7,267,186 Interest Income Transfer - - (91,139) 91,139 Cash Used for Property Acquisition & Debt (3,843,936) (8,223,074) ( 7,358,325) (864,748)

Financing/Contrib Capital/Other Transfers 1,824,623 2,346,562 ( 2,138,582) 4,485,144

Net Change in Cash & Investments 4,397,456 4,053,926 433,531 3,620,396

Balance 01/31 25,420,953 36,161,567 6,887,542 29,274,025

Board Minimum Fund Targets: 16,434,425 8,290,700 8,143,725

Page 5-B -85- PADRE DAM MUNICIPAL WATER DISTRICT POTABLE WATER SALES IN ACRE FEET - COMBINED WESTERN & EASTERN FOR THE SEVEN MONTHS ENDING JANUARY 31, 2018

Western Eastern Total Combined Actual Budget Variance Actual Budget Variance Actual Budget Variance Percent July Totals 492 485 7 359 376 (18) 851 862 (11) -1.2%

August Totals 539 497 42 392 397 (4) 931 893 38 4.2%

September Totals 657 531 125 447 387 60 1,104 918 186 20.3%

October Totals 481 455 26 332 305 27 814 760 53 7.0%

November Totals 494 456 39 309 301 8 803 757 47 6.2%

December Totals 449 418 31 286 216 70 735 634 101 16.0%

January Tier 1 354 328 27 190 160 30 544 487 57 11.6% Tier 2 56 - 56 53 - 53 109 - 109 N/A Tier 3 7 - 7 18 - 18 25 - 25 N/A Tier 4 ------N/A Non-tiered 108 76 32 55 21 34 163 97 67 68.8% January Totals 526 404 123 316 180 135 842 584 258 44.1%

Current Year-to-date Totals Tier 1 2,170 2,510 (340) 1,106 1,766 (660) 3,276 4,276 (1,000) -23.4% Tier 2 569 - 569 735 - 735 1,304 - 1,304 N/A Tier 3 31 - 31 95 - 95 125 - 125 N/A Tier 4 7 - 7 59 - 59 66 - 66 N/A Non-tiered 862 736 126 447 396 51 1,309 1,132 176 15.5% Grand Totals 3,638 3,246 393 2,441 2,162 279 6,079 5,408 671 12.4%

Prior Year to Date Totals Tier 1 2,085 2,361 (277) 999 1,619 (619) 3,084 3,980 (896) -22.5% Tier 2 502 21 481 711 20 690 1,212 41 1,171 2851.7% Tier 3 16 - 16 62 - 62 77 - 77 N/A Tier 4 10 - 10 69 - 69 79 - 79 N/A Non-tiered 767 634 132 414 482 (68) 1,180 1,116 65 5.8% Grand Totals 3,378 3,016 362 2,255 2,121 134 5,633 5,137 496 9.7%

-86- 5B-1 PADRE DAM MUNICIPAL WATER DISTRICT POTABLE WATER SALES GRAPH ACTUAL TO BUDGET COMPARISON - UNITS IN ACRE FEET FOR THE SEVEN MONTHS ENDING JANUARY 31, 2018

2,000

1,750

1,500

1,250 -87-

Acre Feet Acre 1,000

750

500

250

0 JUL AUG SEP OCT NOV DEC JAN FEB MAR APR MAY JUN TOTALS Actual 851 931 1,104 814 803 735 842 6,079 Budget 862 893 918 760 757 634 584 5,408 Variance (11) 37 186 53 47 101 258 671 % Variance -1.2% 4.2% 20.3% 7.0% 6.2% 16.0% 44.1% 12.4% Prior Year 862 893 1,125 760 757 634 603 5,633

5B-2 PADRE DAM MUNICIPAL WATER DISTRICT POTABLE WATER SALES GRAPH CUMULATIVE ACTUAL TO BUDGET COMPARISON - UNITS IN ACRE FEET FOR THE SEVEN MONTHS ENDING JANUARY 31, 2018 12,000

10,000

8,000

6,000 -88- Feet Acre

4,000

2,000

0 JUL AUG SEP OCT NOV DEC JAN FEB MAR APR MAY JUN Cumulative Actual 851 1,782 2,886 3,700 4,503 5,237 6,079 Cumulative Budget 862 1,755 2,673 3,433 4,190 4,824 5,408 Cumulative Act v Bud YTD (11) 27 213 266 313 414 671 Cumulative % Variance -1.2% 1.5% 8.0% 7.8% 7.5% 8.6% 12.4% 0.0% 0.0% 0.0% 0.0% 0.0% Prior Year Cumulative Actual 862 1,755 2,880 3,640 4,397 5,030 5,633 Cumulative % Variance YTD PY -1.2% 1.5% 0.2% 1.6% 2.4% 4.1% 7.9% 0.0% 0.0% 0.0% 0.0% 0.0%

5B-3 PADRE DAM MUNICIPAL WATER DISTRICT STATEMENT OF OPERATIONS FOR SEVEN MONTHS ENDING JANUARY 31, 2018

VARIANCE

WATER REC PRIOR YR Y E A R - TO - D A T E BUDGET PRIOR YR ACTUALS A C T U A L B U D G E T Favor/(Unfavor) Favor/(Unfavor) Income (Loss) from Operations: $ $ % $ % $ % $ % Revenues: Water Sales $ 1,453,307 $ 1,586,317 64.9 $ 1,460,853 59.7 $ 125,464 8.6 $ 1 33,010 9 .2 Infrastructure Access Charge ------Energy Billings ------CWA/ Metro Credits 245,970 115,900 4.7 260,571 10.7 (144,671) (55.5) (130,070) (52.9) Padre Dam Sewer Processing Fee 1,389,045 622,349 25.5 622,349 25.4 - - (766,696) (55.2) Sewer Revenues ------System Charges 107,884 119,636 4.9 102,669 4.2 16,967 16.5 11,752 10.9 Park Fees ------Property taxes subvention ------Other Revenues 15 34 0.0 - - 34 19 126.7 Total Operating Revenues 3,196,221 2,444,236 100.0 2,446,442 100.0 (2,206) (0.1) (751,985) (23.5)

Direct Costs: Water Purchases ------Infrastructure Access Charge ------Energy Purchases ------Sewer METRO Costs ------Padre Sewer Treatment ------Fish Stock/Propane ------Total Direct Costs ------

Revenues Available for Operating Expenses 3,196,221 2,444,236 100.0 2,446,442 100.0 (2,206) (0.1) (751,985) (23.5)

Operating Expenses: Salary & Wages 571,269 547,046 22.4 588,165 24.0 41,120 7.0 24,224 4 .2 Employee Benefits 340,950 344,286 14.1 360,159 14.7 15,872 4.4 ( 3,337) (1.0) Professional Services 129,870 87,681 3.6 137,583 5.6 49,901 36.3 42,189 32.5 Materials, Supplies, Vehicle & Building 134,497 211,507 8.7 181,028 7.4 (30,479) (16.8) (77,009) (57.3) Administrative Expenses 47,217 57,318 2.3 42,393 1.7 (14,925) (35.2) (10,101) (21.4) Utilities 128,532 123,973 5.1 207,964 8.5 83,991 40.4 4,558 3 .5 Billing Credits (92,511) (99,300) (4.1) (73,196) (3 .0) 26,105 35.7 6,789 7 .3 Subtotal 1,259,824 1,272,511 52.1 1,444,096 59.0 1 71,585 11.9 (12,686) (1.0) Depreciation/Amort 463,877 505,569 20.7 472,719 19.3 (32,849) (6.9) (41,692) (9.0) Total Operating Expenses 1,723,701 1,778,079 72.7 1,916,815 78.4 138,736 7 .2 (54,378) (3.2)

Income (Loss) from Operations 1,472,520 666,157 27.3 529, 627 21.6 136,530 25.8 (806,363) (54.8)

Non Operating Activity Interest Expense (48,941) (37,181) (1.5) (14,139) (0 .6) (23,042) (163.0) 11,760 24.0 Interest Income 47,426 83,472 3.4 17,500 0.7 65,972 377.0 36,046 76.0 Gain/Loss on Sale of Fixed Assets ------Other Income/(Expense) ------#DIV/0!

Total Non Operating Income (Expenses) (1,515) 46,291 1.9 3,361 0.1 42,930 1, 277.3 47,806 3,156.2

Change in Net Position $ 1,471,005 $ 712,448 29.1 $ 532,988 21.8 $ 179,460 33.7 $ (758,557) (51.6)

WATER REC CASH & INVESTMENTS Prior Yr Current Yr Rate Stabilization Capital Replacement

Balance 07/01 9,760,059 11,092,202 3,020,885 8,071,317

Change in Net Position 1,471,005 712,448 Add Back Depreciation/Amort 463,877 505,569 Changes in Payables/Receivables, Other 161,514 377,064 Cash Generated from Operations 2,096,396 1,595,080 1,595,080 -

CIP/Capital Equip (534,013) (319,134) (319,134) Debt Principal (699,057) (211,389) (211,389) Transfers to CRF fm Rate Stab - - (1,157,082) 1,157,082 Interest Income Transfer - - (60,935) 60,935 Cash Used for Property Acquisition & Debt (1,233,070) (530,523) (1,218,017) 6 87,493

Financing/Contrib Capital/Other Transfers (31,130) (7,573) - (7,573)

Net Change in Cash & Investments 832,195 1,056,984 377, 064 679,920

Balance 01/31 10,592,254 12,149,186 3,397,949 8,751,237

Board Minimum Fund Targets: 4,606,146 637,044 3,969,102

PAGE 5-C -89- PADRE DAM MUNICIPAL WATER DISTRICT WATER RECYCLING SALES & PARK ACRE FEET FOR THE SEVEN MONTHS ENDING JANUARY 31, 2018

Prior Year Current Year Non-Billable 2016/17 % Month Actual Actual Budget Variance Variance Park*

July 77.1 88.8 82.6 6.2 7.6% 12.1

August 96.5 84.9 103.3 (18.4) -17.8% 15.3

September 130.4 109.8 139.6 (29.8) -21.4% 19.7

October 84.9 89.1 90.9 (1.8) -2.0% 9.1

November 78.6 75.2 84.2 (9.0) -10.6% 9.6

December 52.9 59.0 56.6 2.4 4.2% 4.1

January 20.4 64.4 21.8 42.6 194.8% 3.4

February 7.7 - 8.2 (8.2) -100.0% -

March 17.3 - 18.5 (18.5) -100.0% -

April 41.4 - 44.3 (44.3) -100.0% -

May 70.3 - 75.3 (75.3) -100.0% -

June 79.0 - 84.6 (84.6) -100.0% -

Year-to-date 540.8 571.2 579.0 (7.8) -1.4% 73.3

Annual Totals *** 756.5 802.2 810.0 (7.8) -1.0% 8.3 **

* Non-billable sales to the Park in excess of 65 acre-feet are eligible for MWD/CWA credits. ** Amount eligible for MWD/CWA credits. *** Annual fiscal year threshold for paid incentives is 850 AF, volumes in excess are noncredited with reset in July.

5C-1 -90- PADRE DAM MUNICIPAL WATER DISTRICT STATEMENT OF OPERATIONS FOR SEVEN MONTHS ENDING JANUARY 31, 2018

VARIANCE SEWER PRIOR YR Y E A R - TO - D A T E BUDGET PRIOR YR ACTUALS A C T U A L B U D G E T Favor/(Unfavor) Favor/(Unfavor) Income (Loss) from Operations: $ $ % $ % $ % $ % Revenues: Water Sales $ - $ - - $ - - $ - $ - - Infrastructure Access Charge ------Energy Billings ------CWA/ Metro Credits ------Padre Dam Sewer Processing Fee ------Sewer Revenues 9,445,298 9,872,797 1 00.0 9 ,042,208 99.9 830,589 9.2 427,499 4.5 System Charges ------Park Fees ------Property taxes subvention ------Other Revenues 5,529 4,209 0.0 9,016 0.1 ( 4,807) (53.3) (1,320) (23.9) Total Operating Revenues 9,450,827 9,877,006 100. 0 9,051,224 100.0 825,782 9.1 426,179 4.5

Direct Costs: Water Purchases ------Infrastructure Access Charge ------Energy Purchases ------Sewer METRO Costs 2,330,388 2,829,191 28.6 2 ,286,606 25.3 (542,585) (23.7) (498,803) (21.4) Padre Sewer Treatment 1,389,045 622,349 6.3 6 22,349 6.9 - - 766,696 55.2 Fish Stock/Propane ------Total Direct Costs 3,719,433 3,451,540 34. 9 2,908,955 32.1 (542,585) (18.7) 267,893 7.2

Revenues Available for Operating Expenses 5,731,394 6,425,466 65. 1 6,142,269 67.9 283,197 4.6 694,072 12.1

Operating Expenses: Salary & Wages 1,820,642 1,743,440 17.7 1 ,874,488 20.7 131,048 7.0 77,202 4.2 Employee Benefits 1,185,321 1,196,920 12.1 1 ,252,101 13.8 55,181 4.4 (11,600) (1 .0) Professional Services 781,452 527,594 5.3 8 27,859 9.1 300,265 36.3 253,858 32.5 Materials, Supplies, Vehicle & Building 716,667 1,127,011 11.4 9 64,606 10.7 (162,404) (16.8) (410,344) (57.3) Administrative Expenses 195,574 237,411 2.4 1 75,591 1.9 (61,820) (35.2) (41,838) (21.4) Utilities 325,824 314,268 3.2 5 27,183 5.8 212,914 40.4 11,555 3.5 Billing Credits (329,881) (354,091) (3.6) (261,006) (2.9) 93,085 35.7 24,210 7.3 Subtotal 4,695,597 4,792,553 48.5 5 ,360,823 59.2 568,269 10.6 (96,957) (2 .1) Depreciation/Amort 650,549 701,102 7.1 6 06,799 6.7 (94,303) (15.5) (50,553) (7 .8) Total Operating Expenses 5,346,146 5,493,656 55. 6 5,967,622 65.9 473,966 7.9 ( 147,510) (2.8)

Income (Loss) from Operations 385,248 931,810 9.4 174,647 1.9 757,163 433.5 546,562 141.9

Non Operating Activity Interest Expense (10,555) - - - - - 10,555 100.0 Interest Income 110,464 194,421 2.0 35,000 0.4 159,421 455.5 83,957 76.0 Gain/Loss on Sale of Fixed Assets ------n/a Other Income/(Expense) ------n/a

Total Non Operating Income (Expenses) 99,909 194,421 2.0 35,000 0.4 159,421 455.5 94,512 94.6

Change in Net Position $ 485,157 $ 1,126,231 11. 4 $ 209,647 2.3 $ 916,584 437.2 $ 641,074 132.1

SEWER CASH & INVESTMENTS Prior Yr Current Yr Rate Stabilization Capital Replacement

Balance 07/01 21,904,695 18,372,994 5,581,865 12,791,129

Change in Net Position 485,157 1,126,231 Add Back Depreciation/Amort 650,549 701,102 Changes in Payables/Receivables, Other 436,472 1,018,970 Cash Generated from Operations 1,572,178 2,846,303 2 ,846,303 -

CIP/Capital Equip (398,463) (923,959) (923,959) Debt Principal (286,285) - - Transfers to CRF fm Rate Stab - - (1,728,179) 1,728,179 Interest Income Transfer - - (99,155) 99,155 Cash Used for Property Acquisition & Debt (684,748) (923,959) (1,827,333) 903,374

Financing/Contrib Capital/Other Transfers (4,564,412) 44,040 (753,920) 797,960

Net Change in Cash & Investments (3,676,982) 1,966,383 265,049 1,701,334

Balance 01/31 18,227,712 20,339,377 5,846,915 14,492,462

Board Minimum Fund Targets: 8,791,947 3,311,366 5,480,581

Page 5-D -91- PADRE DAM MUNICIPAL WATER DISTRICT STATEMENT OF OPERATIONS FOR SEVEN MONTHS ENDING JANUARY 31, 2018

VARIANCE PARK PRIOR YR Y E A R - TO - D A T E BUDGET PRIOR YR ACTUALS A C T U A L B U D G E T Favor/(Unfavor) Favor/(Unfavor) Income (Loss) from Operations: $ $ % $ % $ % $ % Revenues: Water Sales $ - $ - - $ - - $ - $ - - Infrastructure Access Charge ------Energy Billings ------CWA/ Metro Credits ------Padre Dam Sewer Processing Fee ------Sewer Revenues ------System Charges ------Park Fees 3,228,216 3,461,203 100.0 3,278,631 1 00.0 182,572 5.6 232,987 7.2 Property taxes subvention ------Other Revenues (379) 117 0.0 - - 117 496 130.9 Total Operating Revenues 3,227,837 3,461,320 100.0 3,278,631 100. 0 182,689 5.6 233,483 7.2 - Direct Costs: Water Purchases ------Infrastructure Access Charge ------Energy Purchases ------Sewer METRO Costs ------Padre Sewer Treatment ------Fish Stock/Propane/Etc 196,434 191,663 5.5 202,027 6.2 10,364 5.1 4 ,771 2.4 Total Direct Costs 196,434 191,663 5.5 202,027 6.2 10,364 5.1 4, 771 2.4

Revenues Available for Operating Expenses 3,031,403 3,269,657 94.5 3,076,604 93. 8 193,053 6.3 238,254 7.9

Operating Expenses: Salary & Wages 718,981 708,242 2 0.5 726,760 22.2 18,518 2.5 10,740 1.5 Employee Benefits 442,726 429,174 1 2.4 471,404 14.4 42,230 9.0 13,552 3.1 Professional Services 197,819 151,460 4.4 188,214 5.7 36,754 19.5 46,359 2 3.4 Materials, Supplies, Vehicle & Building 352,023 325,577 9.4 387,637 11.8 62,060 16.0 26,446 7.5 Administrative Expenses 99,044 82,404 2.4 458,776 14.0 376,372 82.0 16,640 1 6.8 Utilities 407,006 443,371 1 2.8 136,286 4.2 ( 307,085) (225.3) ( 36,366) (8.9) Billing Credits (8,538) - - ( 5,000) (0.2) (5,000) (100.0) (8,538) ( 100.0) Subtotal 2,209,061 2,140,228 6 1.8 2,364,076 72.1 223,848 9.5 68,833 3.1 Depreciation/Amort 445,902 477,845 13.8 443,491 13.5 (34,353) (7 .7) ( 31,943) (7.2) Total Operating Expenses 2,654,963 2,618,073 75.6 2,807,567 85. 6 189,494 6.7 36,891 1.4

Income (Loss) from Operations 376,440 651,584 18.8 269,037 8.2 382,548 142.2 275,145 73.1

Non Operating Activity Interest Expense (109,243) (85,102) (2.5) (234,521) (7.2) 149,419 63.7 24,141 2 2.1 Interest Income 10,190 17,936 0.5 5,833 0.2 12,102 207.5 7 ,745 7 6.0 Gain/Loss on Sale of Fixed Assets ------Other Income/(Expense) ------#DIV/0!

Total Non Operating Income (Expenses) (99,052) (67,166) (1 .9) (228,688) (7.0) 161,522 70.6 31,886 32.2

Change in Net Position $ 277,387 $ 584,418 16.9 $ 40,349 1.2 $ 544,069 1,348.4 $ 307,031 110.7

PARK CASH & INVESTMENTS Prior Yr Current Yr Revenue Stabilization Capital Replacement

Balance 07/01 4,317,662 4,132,169 371,176 3,760,993

Change in Net Position 277,387 584,418 Add Back Depreciation/Amort 445,902 477,845 Changes in Payables/Receivables, Other - - Cash Generated from Operations 723,289 1,062,263 1,062,263 -

CIP/Capital Equip (257,095) (1,165,871) ( 1,165,871) Debt Principal (358,351) (392,948) ( 392,948) Transfers to CRF fm Rate Stab - - (1,049,170) 1,049,170 Interest Income Transfer - - (13,093) 13,093 Cash Used for Property Acquisition & Debt (615,446) (1,558,820) (1,062,263) ( 496,557)

Financing/Contrib Capital/Other Transfers - - - -

Net Change in Cash & Investments 107,843 (496,557) - (496,557)

Balance 01/31 4,425,506 3,635,612 371,176 3,264,436

Board Minimum Fund Targets: 2,172,017 1,414,376 757,641

Page 5-E -92- Park Operations Supplementary Schedule FYE June 30, 2018 (Period-To-Date)

FYE 6-30-2018 FYE 6-30-2017 FYE 6-30-2018 FYE 6-30-2018 Actual Compared To Budget Published-Budget Actual Published-Budget Actual Favorable/(Unfavorable) (total) (7 Month(s) Ending 01/31/17) (period-to-date) (period-to-date) $ %

Revenues: Attendance Entrance Fees $ 406,359 $ 216,195 $ 212,523 $ 220,803 $ 8,280 3.9% Reserved Area Fees 190,843 102,541 95,286 98,434 3,148 3.3% Fishing Fees 322,525 169,318 179,586 177,102 (2,484) -1.4% Boat Rental 87,586 42,366 44,761 40,453 (4,308) -9.6% Bicycle Rental 5,028 4,483 2,495 1,672 (823) -33.0% Community Recreation Fees 47,736 2,209 4,701 6,188 1,487 31.6% RV & Tent Sites 3,539,758 1,906,812 1,981,602 2,055,311 73,709 3.7% Cabin 425,175 201,205 240,788 222,657 (18,131) -7.5% RV Storage 463,702 282,327 289,573 293,063 3,490 1.2% Propane 6,002 441 1,008 1,556 548 54.4% Utilities 101,103 82,907 61,086 113,186 52,100 85.3% Laundry 25,767 24,100 15,121 23,288 8,167 54.0% Other Revenues 0 28,305 0 30,868 30,868 #DIV/0! Total 5,621,584 3,063,209 3,128,529 3,284,581 156,052 5.0%

General Store Store Sales/Concession Fees 272,927 164,627 150,101 176,743 26,642 17.7% Total 272,927 164,627 150,101 176,743 26,642 17.7%

Total Revenues 5,894,511 3,227,836 3,278,630 3,461,324 182,694 5.6%

Direct Costs: Fish Stocking 154,661 89,100 93,489 83,775 9,714 10.4% Propane 2,878 0 0 1,331 (1,331) #DIV/0! Purchases 189,428 107,334 108,538 106,557 1,981 1.8% Total 346,967 196,434 202,027 191,663 10,364 5.1%

Gross Profit: 5,547,544 3,031,402 3,076,603 3,269,661 193,058 6.3%

Operating Expenses: Salary & Wages 1,198,792 676,124 691,611 665,480 26,131 3.8% Benefits 783,028 419,738 453,136 405,356 47,780 10.5% Employee Training & Development 36,000 9,662 20,170 15,141 5,029 24.9% Advertising & Promotion 103,000 55,360 41,705 41,779 (74) -0.2% Dues & Subscriptions 8,500 5,216 6,795 7,236 (441) -6.5% License & Permits 9,750 8,797 6,835 7,254 (419) -6.1% Insurance 50,000 10,000 50,000 2,004 47,996 96.0% Office Supplies 10,500 6,363 6,125 4,996 1,129 18.4% Operating Supplies 57,300 16,517 39,563 17,333 22,230 56.2% Postage 100 0 100 61 39 39.0% Materials & Supplies 223,502 123,356 130,583 132,775 (2,192) -1.7% Repairs & Maintenance 370,250 211,303 215,985 174,698 41,287 19.1% Vehicle/Equipment Usage 0 0 0 0 0 #DIV/0! Professional Fees 305,205 189,057 182,196 148,444 33,752 18.5% Telephone 15,040 6,891 8,773 7,547 1,226 14.0% Utilities 762,990 394,674 445,073 430,977 14,096 3.2% Travel/Conventions&Meetings 3,000 474 0 739 (739) #DIV/0! Miscellaneous 0 0 0 0 0 #DIV/0! Overhead 117,403 84,067 70,426 78,408 (7,982) -11.3% Billing Credits (5,000) (8,538) (5,000) 0 (5,000) -100.0% Total 4,049,360 2,209,061 2,364,076 2,140,228 223,848 9.5%

Operating Income (Loss) before deprec 1,498,184 822,341 712,527 1,129,433 416,906 58.5%

Depreciation-direct (710,652) (407,294) (414,547) (426,402) (11,855) -2.9% Depreciation-indirect (49,620) (38,608) (28,945) (51,443) (22,498) -77.7% Amortization 0 0 0 0 0 #DIV/0!

Operating Income (Loss) after deprec 737,912 376,439 269,035 651,588 382,553 142.2%

Non-Operating Activity: Interest Income 9,996 10,190 5,831 17,936 12,105 207.6% Interest Expense (402,036) (109,243) (234,521) (85,102) 149,419 63.7% Other Income/(Expenses) 0 0 0 0 0 #DIV/0! Total Non-Operating Income/(Expenses) (392,040) (99,053) (228,690) (67,166) 161,524 70.6%

Change in Net Position $ 345,872 $ 277,386 $ 40,345 $ 584,422 $ 544,077 1348.6%

5-E-1

K:\Kevin\ParkMonthly-2018\Copy of Park_FS_FYE_6-30-2018_(monthly)_ForSandy.xls\(FYE 6-30-2018 (period-to-date)) 2/28/201812:00 PM -93- Padre Dam Municipal Water District Park Operations (Statistics) For The Seven Month(s) Ending January 31, 2018

Number of Gate Admissions (does not include walk-through admissions) Month Actual Budget Variance Prior Year July 10,237 8,804 1,433 16.3% 10,524 August 8,157 8,515 (358) -4.2% 8,841 September 6,104 6,541 (437) -6.7% 6,940 October 5,962 4,841 1,121 23.2% 6,507 November 5,014 4,417 598 13.5% 4,499 December 4,277 3,105 1,172 37.7% 3,307 January 5,171 4,629 543 11.7% 3,441

FY 2017/18 (to-date) 44,922 40,850 4,072 10.0% 44,059

Number of Campsite Hookups (Existing) Actual Budget Actual to Budget Reference Month Hookups Occup Hookups Occup Variance Prior Year July 5,068 97.3% 4,767 91.5% 301 6.3% 5,025 August 4,825 92.6% 4,520 86.8% 305 6.7% 4,715 September 4,342 86.2% 3,681 73.0% 661 18.0% 4,348 October 4,387 84.2% 3,630 69.7% 757 20.9% 4,366 November 4,473 88.8% 3,679 73.0% 794 21.6% 4,431 December 4,808 92.3% 3,992 76.6% 816 20.5% 4,764 January 4,704 90.3% 4,074 78.2% 630 15.5% 4,601

FY 2017/18 (to-date) 32,607 90.3% 28,344 78.5% 4,263 15.0% 32,250

Number of Campsite Hookups (New) Actual Budget Actual to Budget Reference Month Hookups Occup Hookups Occup Variance Prior Year July 4,019 98.2% 3,756 91.8% 263 7.0% 4,025 August 3,869 94.6% 3,663 89.5% 206 5.6% 3,887 September 3,581 90.4% 3,294 83.2% 287 8.7% 3,603 October 3,751 91.7% 3,355 82.0% 396 11.8% 3,629 November 3,674 92.8% 3,356 84.7% 318 9.5% 3,734 December 3,933 96.1% 3,632 88.8% 301 8.3% 3,849 January 3,858 94.3% 3,724 91.0% 134 3.6% 3,817

FY 2017/18 (to-date) 26,685 94.0% 24,778 87.3% 1,907 7.7% 26,544

(K:\Kevin\ParkMonthly-2018) Copy of Park_FS_FYE_6-30-2018_(monthly)_ForSandy.xls 5-E-2 2/28/201812:00 PM -94- PADRE DAM MUNICIPAL WATER DISTRICT Departmental Expenditures FOR SEVEN MONTHS ENDING JANUARY 31, 2018

PRIOR YR Y E A R - TO - D A T E V A R I A N C E ACTUAL A C T U A L BUDGET Favor/(Unfavor)

Operating Expenses: Staff Wages & Salaries $ 7,116,176 $ 6,834,172 39.1% $ 7,313,156 37.7% $ 478,984 6.5% Employee Benefits 4,444,884 4,470,497 25.6% 4,699,040 24.2% 228,543 4.9% Contract & Professional Services 2,984,459 2,032,849 11.6% 3,140,341 16.2% 1,107,492 35.3% Materials, Supplies, Bldg, etc. 2,306,925 3,399,802 19.5% 3,018,860 15.6% (380,942) -12.6% Administrative Expenses 790,430 921,694 5.3% 1,079,521 5.6% 157,827 14.6% Utilities 932,697 950,419 5.4% 986,855 5.1% 36,436 3.7% Subtotal 18,575,571 18,609,433 106.5% 20,237,773 104.3% 1,628,340 8.0% Billing Credits (1,068,228) (1,137,460) -6.5% (843,439) -4.3% 294,021 34.9%

TOTAL OPERATING EXP $ 17,507,343 $ 17,471,973 100.0% $ 19,394,334 100.0% $ 1,922,361 9.9%

Departmental Expenses: Finance $ 2,405,337 $ 2,537,001 14.5% $ 2,737,993 14.1% $ 200,992 7.3% Engineering 3,273,022 1,299,400 7.4% 3,557,622 18.3% 2,258,222 63.5% Operations & Water Quality 8,108,808 8,973,071 51.4% 9,083,141 46.8% 110,070 1.2% Human Resources 642,108 690,326 4.0% 751,048 3.9% 60,722 8.1% Administration 953,069 881,441 5.0% 970,883 5.0% 89,442 9.2% Park & Campgrounds 2,124,999 2,061,813 11.8% 2,293,648 11.8% 231,835 10.1%

Advanced Water Purification (1.) - 1,028,921 5.9% - 0.0% (1,028,921) N/A

TOTAL DEPARTMENTAL EXP $ 17,507,343 $ 17,471,973 100.0% $ 19,394,334 100.0% $ 1,922,361 9.9%

Note (1.): AWP expenses are paid from the METRO Fund.

Page 6 -95- PADRE DAM MUNICIPAL WATER DISTRICT DEPARTMENTAL EXPENSE VARIANCES FOR THE SEVEN MONTHS ENDING JANUARY 31, 2018

Salary Employee Professional Materials & Administrative Billing

Department and Wages Benefits Services Supplies, etc. Expenses Utilities Credits Totals

Finance 48,480 22,954 91,365 111,235 (875) 771 (72,938) 200,992

Engineering 41,009 43,340 1,882,410 22,207 29,596 977 238,683 2,258,222

Operations and Water Quality 329,802 148,115 (17,814) (570,281) 69,751 17,221 133,276 110,070

Human Resources 8,738 6,815 33,668 15,176 (4,475) 800 0 60,722

Administration 24,831 (40,466) 78,040 13,739 11,491 1,807 0 89,442

-96- Water and Sewer Operations 452,860 180,758 2,067,669 (407,924) 105,488 21,576 299,021 2,719,448

Park and Campground 26,124 47,785 33,754 61,325 52,523 15,323 (5,000) 231,835

Subtotal 478,984 228,543 2,101,423 (346,599) 158,011 36,899 294,021 2,951,283

Other (AWP) 0 0 (993,931) (34,343) (184) (463) 0 (1,028,921)

Water, Sewer and Park Totals 478,984 228,543 1,107,492 (380,942) 157,827 36,436 294,021 1,922,361

6A PADRE DAM MUNICIPAL WATER DISTRICT NOTES TO OPERATING EXPENSES FOR THE SEVEN MONTHS ENDING JANUARY 31, 2018

Actual - $17,471,973 Budget - $19,394,334 Variance – $1,922,361 Percent – 9.9%

Staff Wages and Salaries District salaries & wages in gross, total $6,834,172 and are $478,984 or 6.5% favorable to budget. • Significant Budget Variances: o Regular pay is favorable to budget by $569,269. o Sick Leave pay is favorable to budget by $113,552. o Vacation/Holiday pay is unfavorable to budget by $131,727. o All other wage accounts net to an unfavorable budget variance of $72,110. o Budgeted wages are spread by month based on actual pay period ending dates. Employee Benefits Benefits to employees total $4,470,497 and are $228,543 or 4.9% favorable to budget. • Significant Budget Variances: o Health Insurance is favorable to budget by $128,743. o PERS Employer is favorable to budget by $56,113. o Worker’s Comp Insurance is favorable to budget by $10,318. o All other benefit accounts net to a favorable budget variance of $33,369. o Budgeted benefits are spread by month based on actual pay period ending dates. Contract and Professional Services Professional services expenses total $2,032,849 and are $1,107,492 or 35.3% favorable to budget. • Significant Budget Variances: o Engineering services are favorable to budget by $1,868,309. o Consulting services are favorable to budget by $118,223. o Other professional services are unfavorable to budget by $968,903. o All other professional services accounts net to a favorable budget variance of $89,863. Materials and Supplies, Building, and Vehicle These accounts total $3,399,802and are a combined $380,942 or 12.6% unfavorable to budget. • Significant Budget Variances: o Materials and supplies accounts are unfavorable to budget by $417,462. o Vehicle and equipment usage accounts are favorable to budget by $71,836. o Building expense accounts are unfavorable to budget by $35,316. Administrative Expenses Administrative expenses total $921,694 and are $157,827 or 14.6% favorable to budget. • Significant Budget Variances: o Employee Development is favorable to budget by $48,287. o General Insurance is favorable to budget by $106,240. o All other administrative expense accounts are favorable to budget by $3,300. Utilities Utilities expenses total $950,419 and are $36,436 or 3.7% favorable to budget. • Significant Budget Variances: o Gas and electric is favorable to budget by $51,672. o All other accounts are unfavorable to budget by $15,236. Billing Credits Billing credits total $1,137,460 and are $294,021 or 34.9% favorable to budget. These credits are calculated based on wages directly related to individual capital projects, and is the value of the labor involved in the construction of fixed assets.

6B -97- PADRE DAM MUNICIPAL WATER DISTRICT LEGAL EXPENDITURES FOR SEVEN MONTHS ENDING JANUARY 31, 2018

BBK & Other Prior Yr YTD ANNUAL LEGAL 2016/17 Jul-17 Aug-17 Sep-17 Oct-17 Nov-17 Dec-17 Jan-18 Feb-18 Mar-18 Apr-18 May-18 Jun-18 ACTUAL BUDGET EXPENDITURES Actual Total 2017/18 GENERAL LEGAL: Main invoice not available General 0 0 0 Acct/IS/Fin/Cust Serv 25,442 1,003 448 1,856 100 349 374 4,129 41,500 Communications / Cust Serv 0 338 338 0 Admin (GM, Communication, & Board) 41,183 1,345 1,124 2,117 4,873 2,913 3,111 15,482 77,925 Personnel 18,347 1,662 1,992 2,988 498 1,006 872 9,018 15,900 Public Info 0 0 0 Engineering 73,913 1,741 434 441 1,946 3,813 370 8,746 146,800 Plant 0 0 0 Field Ops 4,644 539 663 1,202 12,000 Park 30,696 111 2,006 2,429 991 776 6,312 15,000 Wholesale Wtr 0 0 0 Cust. Service 0 0 0 LWD Detachment 0 0 0 Metro Sewer 2,329 0 0 ADA Issues 0 0 0

-98- Sub total 196,554 5,751 4,647 9,407 9,845 9,735 5,840 0 0 0 0 0 0 45,226 309,125 Less: Capitalized Portion of General Legal (107,949) 0 (473) 0 (816) 0 0 0 0 0 0 0 0 (1,289) 0 Total Non-litigation Legal Expense 88,606 5,751 4,174 9,407 9,030 9,735 5,840 0 0 0 0 0 0 43,937 309,125

LITIGATION: PDEA 0 0 Total Litigation 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0

CAPITALIZED PROJECTS: Add: Capitalized portion of General Legal 107,949 - 473 - 816 ------1,289 Other 1,003 74 40 30 106 62 80 392 Castlerock Reorganization 1,333 0

Total Capitalized Expenditures 110,285 74 513 30 922 62 80 0 0 0 0 0 0 1,681 0 OTHER: JM Pipe Litigation (Shared) 623 49 24 91 39 39 111 354 JM Pipe Litigation (Sole Benefit) 71 0 Advanced Water Purification Project 72,579 6,024 6,221 16,435 8,909 29,082 4,661 71,331 Santee Basin Issues 9,047 174 1,053 1,444 565 547 380 4,164 Sycuan Water Service Agreement 3,240 3,312 697 374 1,345 3,785 2,615 12,127 PP&E Annual billing 3,300 3,300 3,300 Third Party Reimbursable Legal Services 2,119 0 2015 General Rate (SDGE Water Coalition) 13,494 422 243 543 1,208 FCC Proceedings (Special District Property) 5,000 0 Colantuono, Highsmith & Whatley 0 485 485

GRAND TOTAL 308,363 19,107 13,409 28,324 20,809 43,250 13,686 0 0 0 0 0 0 138,586 309,125

Page 7 PADRE DAM MUNICIPAL WATER DISTRICT CONTRACT & PROFESSIONAL SERVICES FOR SEVEN MONTHS ENDING JANUARY 31, 2018

YTD ANNUAL Jul-17 Aug-17 Sep-17 Oct-17 Nov-17 Dec-17 Jan-18 Feb-18 Mar-18 Apr-18 May-18 Jun-18 ACTUAL BUDGET Total 2017/18

FINANCE 85,109 25,233 6,169 20,091 52,755 42,393 34,299 266,049 580,665

ENGINEERING 23,878 36,706 35,171 36,980 53,575 11,037 53,663 251,010 3,417,900

OPERATIONS 71,183 39,453 40,807 46,910 50,688 28,900 24,609 302,550 364,542

HUMAN RESOURCES 8,611 1,142 5,707 1,862 8,568 2,974 7,960 36,824 82,415

ADMINISTRATION 8,107 1,578 2,708 4,156 11,065 808 5,620 34,042 102,024

PARK & CAMPGROUND 20,044 17,604 16,416 18,188 40,677 18,496 17,015 148,440 290,205 -99-

ADVANCED WATER PURIFICATION (1.) 37,002 204,222 58,017 163,175 137,366 162,186 231,966 0 0 0 0 993,934 0

SUBTOTAL 253,934 325,938 164,995 291,362 354,694 266,794 375,132 0 0 0 0 0 2,032,849 4,837,751

Other 0 0 0 0 0 0 0 0 0 0 0 0 0 0

TOTAL 253,934 325,938 164,995 291,362 354,694 266,794 375,132 0 0 0 0 0 2,032,849 4,837,751

Note (1.): AWP expenses are paid from the METRO Fund.

Page 8 PADRE DAM MUNICIPAL WATER DISTRICT ORGANIZATIONAL STAFFING BY DEPARTMENT

Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Total Annual Actual Budget TITLE Average 2017/18 ADMINISTRATION GENERAL MANAGER 1 1 1 1 1 1 1 1.0 1.0 ADMINISTRATIVE ASSISTANT (GM) (BOARD SECRETARY) 2 2 2 2 2 2 2 2.0 2.0 COMMUNICATIONS OFFICER 1 1 1 1 1 1 1 1.0 1.0 TOTAL ADMINISTRATION 4 4 4 4 4 4 4 0 0 0 0 0 4.0 4.0

PARK & CAMPGROUNDS DIRECTOR OF PARK & RECREATION 1 1 1 1 1 1 1 1.0 1.0 PARK RECREATION MANAGER 1 1 1 1 1 1 1 1.0 1.0 PARK OPERATIONS MANAGER 1 1 1 1 1 1 1 1.0 1.0 PARK & RECREATION SUPERVISOR - OUTSIDE 1 1 1 1 1 1 1 1.0 1.0 PARK & RECREATION INSIDE COORDINATOR 4 4 4 4 4 4 4 4.0 4.0 PARK & RECREATION OUTSIDE COORDINATOR 6 6 6 6 5 6 6 5.9 6.0 PARK SUPPORT STAFF (FULL-TIME) 0.2 0.2 1.2 1.2 1.2 1 1 0.9 1.0 TOTAL PARK & CAMPGROUNDS 14 14 14 14 13 14 14 0 0 0 0 0 13.9 15.0

FINANCE DEPARTMENT DIRECTOR OF FINANCE 1 1 1 1 1 1 1 1.0 1.0 ACCOUNTING MANAGER 1 1 1 1 1 1 1 1.0 1.0 ACCOUNTANT 1 1 1 1 1 1 1 1.0 1.0 ACCOUNTING SPECIALIST 3 3 3 3 3 3 3 3.0 3.0

-100- INFO SYSTEMS MANAGER 1 1 1 1 1 1 1 1.0 1.0 INFO SYSTEMS TECH SPECIALIST (SYSTEM ADMINISTRATOR) 2 2 2 2 2 2 2 2.0 2.0 INFO SYSTEMS TECH SPECIALIST (I/S ASSISTANT) 1 1 1 1 1 1 1 1.0 1.0 GIS SPECIALIST/COORDINATOR 2 2 2 2 2 2 2 2.0 1.0 CUSTOMER SERVICE MANAGER 1 1 1 1 1 1 1 1.0 1.0 CUSTOMER SERVICE REPRESENTATIVE 8 8 8 8 8 8 8 8.0 7.0 LEAD FIELD SERVICES TECHNICIAN 1 1 1 1 1 1 1 1.0 1.0 FIELD SERVICES TECHNICIAN 5 5 5 5 5 5 5 5.0 5.0 TOTAL FINANCE 27 27 27 27 27 27 27 0 0 0 0 0 27.0 25.0

ENGINEERING DEPARTMENT DIRECTOR OF ENGINEERING 1 1 1 1 1 1 1 1.0 1.0 ENGINEERING MANAGER - CIP 1 1 1 1 1 1 1 1.0 1.0 ENGINEERING MANAGER - DISTRICT SERVICES 1 1 1 1 1 1 1 1.0 1.0 ENGINEER STAFF ASSISTANT 1 1 1 1 1 1 1 1.0 1.0 ENGINEER 3 4 4 4 4 4 4 3.9 3.0 ENGINEERING TECHNICIAN 3 3 3 3 3 3 3 3.0 3.0 RIGHT OF WAY AGENT 1 1 1 1 1 1 1 1.0 1.0 CONSTRUCTION INSPECTOR 2 2 2 2 2 1 1 1.7 2.0 TOTAL ENGINEERING 13 14 14 14 14 13 13 0 0 0 0 0 13.6 13.0

OPERATIONS DEPARTMENT DIRECTOR OF OPERATIONS & WATER QUALITY 1 1 1 1 1 1 1 1.0 1.0 ADMINISTRATIVE ASSISTANT 1.0 1.0 2.0 2.0 2.0 2.0 2.0 1.7 1.2 CATHODIC PROTECTION PROGRAM COORDINATOR 1 1 2 2 2 2 2 1.7 1.0 CONSTR & MAINT SUPERVISOR (UTILITY CREW SUPERVISOR 3 3 3 3 3 3 3 3.0 4.0 CONSTRUCTION EQUIPMENT OPERATOR 6 6 6 6 6 6 6 6.0 6.0 DISTRIBUTION MAINTENANCE SUPERVISOR 2 2 2 2 2 2 2 2.0 2.0 ELECTRICAL/INSTR CONTROL SUPERVISOR 1 1 1 1 1 1 1 1.0 1.0 ELECTRICAL/INSTR CONTROL TECHNICIAN 2 2 2 2 2 2 2 2.0 2.0 EQUIPMENT MECHANIC 2 2 2 2 2 2 2 2.0 2.0 FACILITIES MAINTENANCE SPECIALIST 1 1 1 1 1 1 1 1.0 1.0 FACILITIES MAINTENANCE WORKER 2 2 2 2 2 2 2 2.0 2.0 INDUSTRIAL CODE COMPLIANCE SPECIALIST 1 1 1 1 1 1 1 1.0 1.0 LAB ANALYST 1 1 2 2 2 2 2 1.7 2.0 LAB ANALYST-SENIOR 1 1 1 1 1 1 1 1.0 1.0

Page 9 A PADRE DAM MUNICIPAL WATER DISTRICT ORGANIZATIONAL STAFFING BY DEPARTMENT

Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Total Annual Actual Budget TITLE Average 2017/18 OPERATIONS MANAGER 1 1 1 1 1 1 1 1.0 2.0 PLANT MANAGER 1 1 1 1 1 1 1 1.0 1.0 RECYCLED WATER PLANT OPERATOR 5 5 5 5 5 5 5 5.0 5.0 RECYCLED WATER TECHNICIAN 0 0 0 0 0 0 0 0.0 1.0 SCADA Administrator/TECHNICIAN 1 1 1 1 1 1 1 1.0 1.0 SYSTEMS OPERATOR TECHNICIAN 10 10 10 10 10 10 10 10.0 10.0 UTILITY WORKER 12 12 11 10 10 10 10 10.7 10.0 WAREHOUSE SPECIALIST 1 1 1 1 1 1 1 1.0 1.0 WAREHOUSE WORKER 1 1 1 1 1 1 1 1.0 1.0 WASTEWATER COLLECTION SYSTEMS WORKER 4 4 4 3 3 3 3 3.4 4.0 WATER QUALITY (CONTROL) SPECIALIST 1 1 1 1 1 1 1 1.0 1.0 WATER QUALITY COMPLIANCE SPECIALIST 1 1 1 1 1 1 1 1.0 1.0 TOTAL OPERATIONS 62.0 62.0 64.0 62.0 62.0 62.0 62.0 0.0 0.0 0.0 0.0 0.0 62.3 64.2

HUMAN RESOURCES DEPARTMENT DIRECTOR OF HUMAN RESOURCES 1 1 1 1 1 1 1 1.0 1.0 HUMAN RESOURCES SPECIALIST 1 1 1 1 1 1 1 1.0 1.0 SAFETY & RISK MANAGER 1 1 1 1 1 1 1 1.0 1.0 TOTAL HUMAN RESOURCES 3 3 3 3 3 3 3 0 0 0 0 0 3.0 3.0

TOTAL DISTRICT APPROVED REGULAR EMPLOYEES 124.2 125.2 128.2 126.2 125.2 125.0 125.0 0.0 0.0 0.0 0.0 0.0 125.6 125.2 -101-

TEMPORARY & PART-TIME POSITIONS COMMUNICATIONS ASSISTANT 1 1 1 1 1 1 1 0.7 0.7 CUSTOMER SERVICE REP - TEMP 0 1 1 1 1 1 1 0.9 1.0 ENGINEER - LIMITED TERM 1 0 0 0 0 0 0 0.1 1.8 GIS INTERN 1 1 1 1 1 1 1 0.5 1.0 HR STAFF SUPPORT - PIPELINE 1 1 1 1 1 1 1 0.5 0.4 OPERATIONS STAFF SUPPORT 0 0 0 0 3 3 3 1.4 0.3 OPERATIONS UTILITY WORKER - OPERATIONS 0 0 0 0 0 0 0 0.0 0.0 PARK & REC AIDE - PART-TIME 4.8 5.5 5.5 5.4 0.0 0.0 0.0 3.0 3.9 PARK SUPPORT STAFF (PART-TIME) 0.8 0.8 1 1 5 4 4 2.4 0.0 PARK SUPPORT STAFF (seasonal) 2.0 2.0 0.0 0.0 0.8 0.8 0.8 0.9 1.3 PARK SUPPORT STAFF (on call) 2 2 2 2 0 0 0 1.1 0.3 Engineering - Limited Term 2 0 0 0 0 0 0 0.2 0.0 13.9 13.3 12.3 12.1 15.1 14.1 14.1 0.0 0.0 0.0 0.0 0.0 13.5 10.5

TOTAL STAFFING 138.1 138.5 140.5 138.3 140.3 139.1 139.1 0.0 0.0 0.0 0.0 0.0 139.1 135.7

BOARD OF DIRECTORS 5 5 5 5 5 5 5 5 5

VOLUNTEER POSITIONS PARK 7.5 7.5 7.5 7.5 7.5 7.5 7.5 7.5 7.5

Page 9 B PADRE DAM MUNICIPAL WATER DISTRICT MAJOR CONSTRUCTION PROJECTS FOR SEVEN MONTHS ENDING JANUARY 31, 2018

ANNUAL ACTUAL TOTAL REMAINING JOB # DESCRIPTION BUDGET Month of YTD Costs PROJECT PROJECT 2017/18 January-18 2017/18 ITD * BUDGET BUDGET 98046 JOINT WTR AGENCIES NCCP (MSCP WILDLIFE CORRID) - 825,625 825,625 - 98048 ANNUAL RAISE AIR VACS ** - 236,225 236,225 - 99017 WSA VALVE REPLACEMENT PROGRAM ** 360,000 2,646 269,664 6,942,222 7,032,558 90,336 201004 SEWER MANHOLE REHAB ** - - 266 771,171 770,905 (266) 202008 WSA POLYSERVICE REPLACEMENT ** 153,000 12,870 121,840 2,598,356 2,629,516 31,160 202032 ESA POLYSERVICE REPLACEMENT ** 66,000 2,097 27,452 964,528 1,003,076 38,548 202033 ESA AIRVACS - 322,421 322,421 - 202034 ESA VALVE REPLACEMENT PROGRAM** 61,000 19,993 104,241 1,617,622 1,574,381 (43,241) 203032 ESA SEC. SUPPLY CONN ORIG SITE RESTORATION - - 33,015 10,815,893 10,782,878 (33,015) 204021 HWD/PD CONNECTION @ CAMINO CANADA (97008) - 19,975 19,975 - 204030 MAGNOLIA AVE SO RELIEF SEWER SEGMENT 1 DSN & CON - 39,007 39,007 - 205002 SECURITY UPGRADES PH2 - 18,619 65,126 798,388 733,262 (65,126) 205014 CSC PHASE II OPS - 12,059,245 12,059,245 - 206007 LAKESIDE INTERCEPTOR REPL PARTICIPATION - 1,229,835 1,229,835 - 206011 COTTONWOOD ESTATES D/P - 105,995 105,995 - 206040 WRF PLC NEWWORK UPGRADE - 24,457 24,457 - 207004 S LAKES PK-RESTROOM RENOVATION - 7,003 7,003 - 207006 WRF TREATMENT EQUIPMENT REPLACEMENT PROGRAM - - 8,784 237,830 229,046 (8,784) 207039 WRF NPDES RENEWAL - 268,270 268,270 - 208003 SCADA SOFTWARE UPGRADES - OPS - 1,388,040 1,388,040 - 208015 BLOWOFF INSTALLATIONS ** 41,000 - 3,736 770,986 808,250 37,264 208026 5 RES RETRO PH 3 - W. VICTORIA - 5,959,345 5,959,345 - 208027 5 RES RETRO PH 4 - BLOSSOM VALLEY - 126,389 126,389 - 208029 S LAKES PK-SHELTERS REPLACEMENT - 1,107,705 1,107,705 - 209004 CSC ELEC RELIABILITY & CONSOLIDATION - 79,323 79,323 - 209013 IPS SCREENING IMPROVEMENT PROJ - 106,086 106,086 - 209014 EMERGENCY GENERATOR - FLINN SPRINGS PS - 1,173,630 1,173,630 - 209019 RIOS CANYON PS EMERG GEN SET - 768,176 768,176 - 209021 ALPINE HIGH SCHOOL D/P (PART OF SPANISH BIT LOOP) - 557 557 - 210001 ESA 2ND CONNECTION MITIGATION & MONITORING - 340 340 - 210012 ALPINE RANCH ESTATES WEST D/P - 26,322 26,322 - 210019 COMPUTER PROJECT 2010/2011 - 35,552 35,552 - 210026 SUNRISE RESERVOIR EROSION CONTROL - 652,687 652,687 - 211003 PROSPECT AVE. WIDENING (CUYAMACA TO MAGNOLIA) - - 702 1,247,411 1,246,709 (702) 211012 SOLAR POWER - RES/OPS/WRF SITES - 6,640 6,640 - 211014 RIOS CANYON SUCT LINE REHAB/REPLACEMENT - 420,466 420,466 - 211017 S LAKES PK - CAMPGROUND PLAYGROUND RENOVATION - 130,775 130,775 - 211022 WALMART SWR DIVERSION PRELIMINARY STUDY - (136,306) (136,306) - 211023 VAULT LID REPLACEMENT - 49,897 49,897 - 211025 WRF CHLORINE TROLLEY MODIFICATION - 407,891 407,891 - 212002 WRF PAVING REPAIR - 74,303 74,303 - 212004 COUNTY WING AVENUE SEWER RELOCATION - 132,162 132,162 - 212006 LAKESIDE WD CONNECTION - ABANDON - 100,176 100,176 - 212007 FY 11/12 CIP POST ENG ASBUILTS (SUBSEQUENT) - 16,084 16,084 - 212008 FINANCIAL COMPUTER SYST UPGRADE - EDMS IMPLEMEN - 270,751 270,751 - 212010 VIEWSIDE LANE 8" RPLC DESIGN & CONSTRUCTION - 135 1,119 94,702 93,584 (1,118) 212011 ANNUAL SEWER RPLC/REHAB - BRAVERMAN SEWER CIPP - 352,072 352,072 - 212012 FINANCIAL COMPUTER SYST UPGRADE - CIS SOFTWARE - - 2,206 1,444,450 1,442,244 (2,206) 212013 FINANCIAL COMPUTER SYST UPGRADE - FINANCE & HR S - 733,266 733,266 - 212014 CSC PHASE II, VERIZON RELOCATION - 6,062 6,062 - 212015 ESA SECONDARY CONNEC LAND ACQ - VALLONE - 757,864 757,864 - 212016 S LAKES PK - SYCAMORE RESTROOM REPAIRS - 504,630 504,630 - 212018 S LAKES PK - PAVING LAKE 1 - 129,815 129,815 - 213002 WRF MAGNETIC METER INSTALL - 1,617 1,617 - 213005 ESA SECONDARY CONNECTION LAND ACQ - EL DORADO - 277,850 277,850 - 213006 FY 2013/14 CIP POST ENG ASBUILT - 59,993 59,993 -

PAGE 10 A -102- PADRE DAM MUNICIPAL WATER DISTRICT MAJOR CONSTRUCTION PROJECTS FOR SEVEN MONTHS ENDING JANUARY 31, 2018

ANNUAL ACTUAL TOTAL REMAINING JOB # DESCRIPTION BUDGET Month of YTD Costs PROJECT PROJECT 2017/18 January-18 2017/18 ITD * BUDGET BUDGET 98046 JOINT WTR AGENCIES NCCP (MSCP WILDLIFE CORRID) - 825,625 825,625 - 213007 WSA VALVE REPLACEMENT PROGRAM (2013/14) - 281,892 281,892 - 213008 ANNUAL SEWER RPLC/REHAB - SEWER CIPP REPAIRS 13/ - 276,682 276,682 - 213009 WRF VALVE REPLACEMENT FY 14 - 102,351 102,351 - 213010 CHOCOLATE SUMMIT RES LAND ACQ. - 130,541 130,541 - 213012 EMERGENCY DIESEL TRAILER PUMP - 430,504 430,504 - 214001 IPS CHOPPER PUMP PROJECT - 8,626 8,626 - 214002 PS 3 & 4 SURGE TANK COATING (PREV. RESERVOIR & SU - 160,504 160,504 - 214003 IPS GRINDERS & GATES RPLC - 170,224 170,224 - 214004 PS 1 SURGE TANK REPLACEMENT DESIGN & CONSTRUCTI - - 674 654,091 653,417 (674) 214005 POINCIANA DR. - 33 33 - 214007 ESA SECONDARY CONNECTION ALT SITE 12,258,735 65,577 6,947,596 12,318,152 17,629,291 5,311,139 214008 PARK OFFICE / RESTROOM RENOVATION - - (560) 5,557 6,117 560 214009 WRF CHLORINE TROLLEY POST CONSTRUCTION - 45,724 45,724 - 214012 LA CRESTA PRS PLANNING - - 575 252,625 252,050 (575) 214014 SMALL DIA SEWER REPAIRS - 278,019 278,019 - 214016 S LAKES TENGO (WIFI) UPGRADE - 2,435 7,526 84,831 77,305 (7,526) 214018 MAST STEEL PIPE REPAIRS DESIGN & CONSTR. - - 560 506,031 505,471 (560) 214019 URBAN WATER MGMT PLAN 2015 - 2016 - 320 320 - 215002 PROSPECT BRIDGE PIPE REPAIR - 10,437 10,437 - 215004 VALVE REPLACEMENT PROGRAM FY 14/15 (CONTRACT) - 17,380 51,897 61,400 9,503 (51,897) 215007 PROP ONE - WRF EXPANSION - - 208 183,677 183,469 (208) 215008 ESA SECONDARY CONNECTION GRADING - 378,825 378,825 - 215009 GROSSMONT COLLEGE PRIVATIZATION 204,000 125,415 138,824 248,263 313,439 65,176 215010 CSC TENANT IMPROVEMENT - 32,513 32,513 - 215011 EAST COUNTY REGIONAL REUSE PROGRAM - 5,412 17,196 175,195 157,999 (17,196) 215014 S LAKES LAKE 1 LANDSCAPE - 48,081 48,081 - 215015 SEWER PROJECTS 16/17 1,884,840 11,627 523,368 1,027,858 2,389,230 1,361,372 215016 AWP BRINE MINIMIZATION PILOT TESTING - 18 18 - 215018 SANTEE LAKES OPS YARD BUFFER - - 243 4,878 4,635 (243) 215022 COUNTY OF SD WING AVE - 139,289 139,289 - 215023 S LAKES FAMILY REC AREA (LAKE 4) - 219 219 281 62 (219) 216001 EL CAP PL VALVE & VAULT REMOVAL WOODSIDE (PREV 3 - 117 495 41,465 40,970 (495) 216003 S LAKES STANDBY GENERATOR - 123,914 136,312 168,208 31,896 (136,312) 216004 S LAKES PARK RESERVATION SOFTWARE UPGRADE - 22,858 22,858 - 216005 S LAKES SNACKLE BOX - 5,359 5,359 - 216006 S LAKES WEBSTE DESIGN - 9,558 9,558 - 216007 S LAKES SHED IMPROVEMENT - - 2,382 46,414 44,032 (2,382) 216010 RECYCLED WATER PUBLIC FILLING STATION 102,000 - 308 1,611 103,303 101,692 216016 WRF AERATION PANELS - 224,151 224,151 - 216017 S LAKES KIWANIS PLAYGROUND SHADE STRUCTURE - 37,662 37,662 - 216024 PS 3 & 4 SURGE TANKS REPLACEMENT 714,000 5,067 22,331 113,846 805,515 691,669 216025 WRF CONCRETE REPAIR - - 3,446 553,855 550,409 (3,446) 216026 WRF FENCE REPLACEMENT 300,000 - 284,771 320,940 336,169 15,229 216027 METER SHOP ROOF REPLACEMENT - 117 150,210 165,320 15,110 (150,210) 216028 S LAKES WEST SIDE PARKING - 245 642,058 1,665,655 1,023,597 (642,058) 216029 S LAKES KIWANIS PLAYGROUND RUBBERIZED SURFACE - 40,292 40,292 - 216030 GIS BUILD OUT - 59,683 59,683 - 216032 FY 17 CIP POST ENG ASBUILTS - 1,929 16,784 33,996 17,212 (16,784) 216033 OPS YARD POST CONSTRUCTION ASBUILTS - - 175 (6,044) (6,219) (175) 216035 SITE PAVING AS NEEDED 192,000 265,865 457,865 192,000 216037 WRF SCADA HARDWARE - 81,757 81,757 - 216038 S LAKES SHORELINE RESTORATION - 25,375 25,375 - 216039 WOODSIDE SEWER LIFT STATION 255,000 104 255,104 255,000 217001 WRF BLOWER REPLACEMENT 357,000 53 480 480 357,000 356,520 217003 WATER PUMPS REPLACEMENT PROGRAM - 282 282 37,634 137,352 99,718

PAGE 10 B -103- PADRE DAM MUNICIPAL WATER DISTRICT MAJOR CONSTRUCTION PROJECTS FOR SEVEN MONTHS ENDING JANUARY 31, 2018

ANNUAL ACTUAL TOTAL REMAINING JOB # DESCRIPTION BUDGET Month of YTD Costs PROJECT PROJECT 2017/18 January-18 2017/18 ITD * BUDGET BUDGET 98046 JOINT WTR AGENCIES NCCP (MSCP WILDLIFE CORRID) - 825,625 825,625 - 217007 S LAKES GENERAL STORE & ADMIN. BLDG IMPROVEMENT 800,000 70,539 288,956 288,956 800,000 511,044 217008 SUNRISE RESERVOIR DRAINAGE & SITE IMPROVEMENT - - 67 14,370 64,303 49,933 217010 IPS WET WELL IMPROVEMENTS 714,000 - 714,000 714,000 217011 S LAKES ADA IMPROVEMENTS 120,000 31,095 32,735 37,386 124,651 87,265 217014 S LAKES OBSERVATION DECK - - 2,273 2,508 235 (2,273) 217015 S LAKES Dog Park - 788 35,700 35,700 35,000 (700) 217019 RES. (VIEJAS MTN) REBURB/COATING - DESIGN & CONST 240,000 671 43,449 43,449 240,000 196,551 217020 ANNUAL SEWER REPL/REHAB 230,000 7,043 8,639 8,639 230,000 221,361 217022 Woodrose Ave. Techite Sewer Replacement - 42,257 62,637 62,637 - (62,637) 217021 Alpine Blvd. Water Main Relocate - - 60,212 60,212 - (60,212) 217023 ONBASE INSTALLATION & CONVERSION - - 8,904 8,904 - (8,904) 217024 IPS Wet Well & Force Main Improvements - 16,604 141,953 141,953 - (141,953) 217032 WRF Primary & Second Basin Refurbishing - 7,197 30,375 30,375 - (30,375) 217035 S LAKES WEST LK 16/17 IMPROVEMENTS - - 16,754 16,754 50,000 33,246 217041 SECURITY ENHANCEMENTS-FIELD SITES - 2,122 28,348 28,348 50,000 21,652 36-IN TRANS MAIN VALVE/VAULT UPGRADES 200,000 - 200,000 200,000 ALPINE PACIFIC RESERVOIR IMPROVEMENTS 350,000 - 350,000 350,000 D/P GENERAL 77,000 - 77,000 77,000 MOUNTAIN VIEW CONNECTOR - DESIGN & CONSTRUCTIO 1,020,000 - 1,020,000 1,020,000 PRESSURE REDUCING STATION INSTALLATIONS - DESIGN 41,000 - 41,000 41,000 SCADA UPGRADES AT DISTRICT FACILITIES - WATER 51,000 - 51,000 51,000 SECURITY ENHANCEMENTS - FIELD SITES 41,000 - 41,000 41,000 SEWER TECHITE PIPE WOODROSE AVE. - DESIGN & CONS 2,040,000 - 2,040,000 2,040,000 VALVE REPLACEMENT CONTRACTED - WATER 255,000 - 255,000 255,000 WRF ELECTRICAL 51,000 - 51,000 51,000

23,178,575 594,465 10,347,513 81,875,433 94,991,396 13,115,963 100% of ANNUAL BUDGET 23,178,575 % of ANNUAL BUDGET COMPLETED 44.6% DEVELOPER JOBS 174,991 GRAND TOTAL ALL JOBS 10,522,504 * Inception to Date **Capitalized annually, JOB remains open. CIP Summary by Department Annual CIP Month YTD 100% Budget Department Budget Completed Completed % Completed Engineering 19,743,575 282,784 7,952,192 40.3% Field Ops 1,807,000 82,393 922,132 51.0% Water Recycling 708,000 53 297,481 42.0% Finance - - 2,206 #DIV/0! GM - - 8,904 #DIV/0! Park 920,000 229,235 1,164,598 126.6% Totals 23,178,575 594,465 10,347,513 44.6%

PAGE 10 C -104- PADRE DAM MWD CIP SUMMARY FOR SEVEN MONTHS ENDING JANUARY 31, 2018

Capital Replacement Restricted Capital Expansion Job # YTD or CIP Energy Potable Sewer P R O J E C T Potable Recycled Sewer Park TOTALS WO# ACTUAL EXPEND 610 611 521 523 WSA VALVE REPLACEMENT PROGRAM 99017 269,664 269,664 ------269,664 SEWER MANHOLE REHAB 201004 266 - - 266 - - - - - 266 WSA POLYSERVICE REPL 202008 121,840 121,840 ------121,840 ESA POLY SERVICE REPLACEMENT 202032 27,452 27,452 ------27,452 ESA VALVE REPLACEMENT 202034 104,241 104,241 ------104,241 ESA SECOND SUPPLY CONNECTION 203032 33,015 20,205 - - - - 12,810 - - 33,015 SECURITY UPGRADES PH 2 205002 65,126 42,332 - - - - 22,794 - - 65,126 WRF TREATMENT EQUIPMENT REPLACEMENT PG 207006 8,784 - 2,635 6,149 - - - - - 8,784 BLOWOFF INSTALLATIONS 208015 3,736 3,736 ------3,736 PROSPECT ST WIDENING (CUYAMACA TO MAGNOLIA) 211003 702 491 140 70 - - - - - 702 I-8 CROSSING - VIEWSIDE LANE 8" REPLACEMENT 212010 1,119 1,119 ------1,119 CUSTOMER INFO SYSTEM SOFTWARE 212012 2,206 1,324 552 110 - - 154 44 22 2,206 PS 1 SURGE TANK REPLACEMENT DESIGN & CONSTRUCTION 214004 674 674 ------674 ESA SECONDARY CONNECTION ALT SITE 214007 6,947,596 4,251,929 - - - - 2,695,667 - - 6,947,596 S LAKES PK - OFFICE / RR RENOVATION 214008 (560) - - - (560) - - - - (560) LA CRESTA PRS PLANNING 214012 575 575 ------575 S LAKES TENGO (WIFI) UPGRADE 214016 7,526 - - - 7,526 - - - - 7,526 MAST BRIDGE STEEL PIPE REPAIRS 214018 560 560 ------560 OPS - VALVE REPLACEMENT CONTRACTOR 2015 215004 51,897 51,897 ------51,897 PROP ONE - WRF EXPANSION 215007 208 104 - 104 - - - - - 208 GROSSMONT COLLEGE PRIVATIZATION 215009 138,824 - - - - - 138,824 - - 138,824 EAST COUNTY REGIONAL REUSE PROGRAM 215011 17,196 5,847 - 6,878 - - 2,751 1,720 - 17,196 SEWER PROJECTS 15/16 215015 523,368 - - 455,330 - - - 68,038 - 523,368 SANTEE LAKES OPS YARD BUFFER 215018 243 - - - 243 - - - - 243 S LAKES FAMILY REC AREA (LAKE 4) 215023 219 - - - 219 - - - - 219 36" TRANS MAIN VALVE VAULT RPLC 216001 495 - 495 ------495 S LAKES STANDBY GENERATOR 216003 136,312 - - - 136,312 - - - - 136,312 S LAKES SHED IMPROVEMENT 216007 2,382 - - - 2,382 - - - - 2,382

-105- RECYCLED WATER PUBLIC FILLING STATION 216010 308 - 308 ------308 PS 3 & 4 SURGE TANKS REPLACEMENT 216024 22,331 22,331 ------22,331 WRF CONCRETE REPAIR 216025 3,446 - 2,309 1,137 - - - - - 3,446 WRF FENCE REPLACEMENT 216026 284,771 - 190,797 93,974 - - - - - 284,771 METER SHOP ROOF REPLACEMENT 216027 150,210 70,448 63,689 16,072 - - - - - 150,210 S LAKES WEST SIDE PARKING 216028 642,058 - - - 642,058 - - - - 642,058 FY 17 CIP POST ENGINEERING ASBUILTS 216032 16,784 11,245 1,007 4,532 - - - - - 16,784 OPS YARD POST CONSTRUCTION ASBUILTS 216033 175 56 12 53 - - 25 23 7 175 WRF BLOWER REPLACEMENT 217001 480 - - 480 - - - - - 480 WATER PUMPS REPLACEMENT PROGRAM 217003 282 282 ------282 S LAKES GENERAL STORE & ADMIN. BLDG IMPROVEMENTS 217007 288,956 - - - 288,956 - - - - 288,956 SUNRISE RESERVOIR DRAINAGE & SITE IMPROVEMENT 217008 67 67 ------67 S LAKES ADA IMPROVEMENTS 217011 32,735 - - - 32,735 - - - - 32,735 S LAKES OBSERVATION DECK 217014 2,273 - - - 2,273 - - - - 2,273 S LAKES CAMPGROUND DOG PARK 217015 35,700 - - - 35,700 - - - - 35,700 RES. (VIEJAS MTN) REBURB/COATING - DESIGN & CONSTRUCTION 217019 43,449 43,449 ------43,449 ANNUAL SEWER REPL/REHAB 217020 8,639 - - 8,639 - - - - - 8,639 Alpine Blvd. Water Main Relocate 217021 60,212 60,212 ------60,212 Woodrose Ave. Techite Sewer Replacement 217022 62,637 - - 62,637 - - - - - 62,637 ONBASE INSTALLATION & CONVERSION 217023 8,904 4,612 650 2,368 1,273 - - - - 8,904 IPS Wet Well & Force Main Improvements 217024 141,953 - - 141,953 - - - - - 141,953 WRF Primary & Second Basin Refurbishing 217032 30,375 - 30,375 ------30,375 S LAKES WEST LK 16/17 IMPROVEMENTS 217035 16,754 - - - 16,754 - - - - 16,754 SECURITY ENHANCEMENTS-FIELD SITES 217041 28,348 28,348 ------28,348 ------

TOTALS 10,347,513 5,145,041 292,969 800,754 1,165,871 - 2,873,025 69,824 29 10,347,513

Developer Jobs 174,991 122,494 - 52,497 - - - - - 174,991

TOTALS 10,522,504 5,267,534 292,969 853,251 1,165,871 - 2, 873,025 69,824 29 10,522,504

PAGE 10 D PADRE DAM MUNICIPAL WATER DISTRICT Overtime Report: July 1, 2017 - June 30, 2018

YTD ANNUAL Jul-17 Aug-17 Sep-17 Oct-17 Nov-17 Dec-17 Jan-18 Feb-18 Mar-18 Apr-18 May-18 Jun-18 TOTAL BUDGET FINANCE: 11 Accounting $ 578 $ 157 $ - $ 217 $ - $ 261 $ 216 $ - $ - $ - $ - $ - $ 1,429 $ 8,000 12 Customer Service - 68 - 17 22 176 ------283 1,500 13 Meter Reading - 29 34 77 - - 126 - - - - - 266 1,000 15 AS/400 ------16 Network 112 21 84 174 ------391 3,000 19 Finance Administration ------Total Finance $ 690 $ 275 $ 118 $ 485 $ 22 $ 437 $ 342 $ - $ - $ - $ - $ - $ 2,369 $ 13,500

ENGINEERING: 30 Customer Service $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - 31 Developer Projects - - - - - 310 ------310 1,500 32 Automation Map/GIS ------34 District Projects ------35 Cathodic Inspection ------36 Right of Way ------106- 37 Inspection 886 1,102 480 1,875 7,473 171 1,699 - - - - - 13,686 12,000 38 Location ------39 Engineering Administration ------Total Engineering $ 886 $ 1,102 $ 480 $ 1,875 $ 7,473 $ 481 $ 1,699 $ - $ - $ - $ - $ - $ 13,996 $ 13,500

OPERATIONS: 41 System Operators $ 3,551 $ 3,009 $ 3,832 $ 3,371 $ 3,787 $ 4,085 $ 1,715 $ - $ - $ - $ - $ - $ 23,350 $ 22,000 43 Electrical 269 - 244 456 488 159 ------1,616 2,500 44 Warehouse Inventory - - 90 - - 54 ------144 200 45 Mechanic - - - - - 155 ------155 200 46 Valve Crew 966 1,020 590 1,878 689 1,205 281 - - - - - 6,629 700 47 Pump Station Maintenance 230 - 184 173 528 708 655 - - - - - 2,478 2,300 48 SCADA 451 169 1,311 634 338 1,452 254 - - - - - 4,609 5,000 49 Cathodic Coating/Maintenance - - - 300 225 ------525 750 51 Plant Operations 1,277 766 409 963 546 1,297 1,452 - - - - - 6,710 20,000 52 Lab / Monitoring 947 248 - - 176 558 295 - - - - - 2,224 10,000 53 Cross Connection - 132 ------132 - 55 Wtr Recl - - - - - 56 ------56 1,000 61 Facilities Maintenance 890 351 766 393 1,102 1,437 556 - - - - - 5,495 2,500 66 Industrial Compliance ------71 Sewer Collector System Maint 464 88 73 1,164 153 2,035 452 - - - - - 4,429 15,000 72 Operating Contingency ------73 Construction Crews 3,967 7,435 2,402 11,789 5,561 17,259 4,062 - - - - - 52,475 30,000 79 Field Operations Admin ------Totals Operations $ 13,012 $ 13,218 $ 9,901 21,121$ $ 13,593 $ 30,460 $ 9,722 $ - $ - $ - $ - $ - 111,027$ $ 112,150

Page 11-A PADRE DAM MUNICIPAL WATER DISTRICT Overtime Report: July 1, 2017 - June 30, 2018

YTD ANNUAL Jul-17 Aug-17 Sep-17 Oct-17 Nov-17 Dec-17 Jan-18 Feb-18 Mar-18 Apr-18 May-18 Jun-18 TOTAL BUDGET

HUMAN RESOURCES & SAFETY: 92 Human Resources $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - 95 Safety ------Total Human Resources & Safety $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ -

ADMINISTRATION: 69 Administrative Services $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - 93 Board & Board Support ------91 Communications ------99 General Management ------Total Administration $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ -

PARK & CAMPGROUND: 62 Day Use Recreation Svcs $ 774 $ 1,549 $ 1,253 $ 2,300 $ 1,412 $ 2,305 $ 1,078 $ - $ - $ - $ - $ - $ 10,671 $ 16,000 64 Campgrounds ------107- Total Park & Campgrounds $ 774 $ 1,549 $ 1,253 $ 2,300 $ 1,412 $ 2,305 $ 1,078 $ - $ - $ - $ - $ - $ 10,671 $ 16,000

GRAND TOTAL ALL DEPARTMENTS $ 15,362 $ 16,144 11,752$ 25,781$ $ 22,500 $ 33,683 12,841$ $ - $ - $ - $ - $ - 138,063$ $ 155,150

Page 11-B PADRE DAM MUNICIPAL WATER DISTRICT

MONTHLY TREASURER'S STATEMENTS

January 31, 2018

Notes to Treasurer's Statements ...... Page 13

Cash and Investment Summary ...... Page 14

Graph - Investments by Type - Market Value ...... Page 15

Graph - Major Investment Yield Comparison ...... Page 16

California Bank & Trust Loan and COP - Financial Requirements. . Page 17

Glossary of Terms ...... Page 18

-108- Padre Dam Municipal Water District Notes to the Treasurer’s Statements as of 1/31/18

In January, there were several maturities and purchases of investments. Maturities included a US Treasury note with a $1.8M par value and 1.625% coupon rate, a John Deere Capital Corp note with a $60K par value and 1.650% coupon rate, a John Deere Capital Corp note with a $50K par value and coupon rate of 1.650%, a Bank of Tokyo Mitsubishi commercial paper with a par value of $600K and coupon rate of 0%, and a FNMA note with a $350K par value and 1.000% coupon rate. Purchases included a US Treasury note with a $1.8M par value and 1.375% coupon rate, a John Deere Capital note with a par value of $110K and coupon rate of 2.350%, a Bank of Tokyo Mitsubishi commercial paper with a par value of $600K and coupon rate of 0%, and an International Finance Corp note with a par value of $350K and coupon rate of 2.250%.

Including proceeds from the issuance of the COP, about 21.1% of available cash is now in LAIF at an interest rate of 1.350%. LAIF balance at the end of the month was $21,412,123. Not including the proceeds from the issuance of the COP Loan, about 23.2% of available cash is in LAIF.

PFM managed funds of $44,005,991 had a yield to maturity at market of 2.185%, a yield to maturity at cost of 1.628% and an average duration of 1.78. Padre Dam MWD managed funds of $48,165,814 had a yield at cost of .617%. The total portfolio average time to maturity was 314 days. Not including the proceeds from the issuance of the COP Loan, the average time to maturity was 346 days. The remaining proceeds from issuance of the 2009 COP were invested in a series of CD’s that matured in October. The proceeds were transferred to the District’s unrestricted funds in December to reimburse the District for approved expenditures.

The Dow closed at 26,149 at month end, about 1,430 points higher than it was at the end of last month. Treasury bond prices on shorter term maturities were lower from last month. The yield on the 30-year bond was higher from 2.740% to 2.936%. The yields on shorter-term bonds of 3 to 5 years were higher from the prior month. The Fed Funds Rate ranged between 1.25% and 1.50%.

All investments have been made in accordance with Padre Dam MWD Investment Policy. The Investment Summary provides documentation that Padre Dam MWD has sufficient funds to meet a minimum of six months pool’s expenditure requirements, in compliance with Government Code, Section 53646.

13a

-109- PADRE DAM MUNICIPAL WATER DISTRICT CASH & INVESTMENT SUMMARY January 31, 2018 Monthly Treasurer's Report YTM YTM Par Original Cost Market Source of Accrued Variance Actual Board Days Purchase Description/Issuer Coupon at Cost at Mkt Value Value Valuation Interest Cost to Mkt % of Authorized Maturity to Date Rate 1/31/2018 1/31/2018 1/31/2018 1/31/2018 1/31/2018 1/31/2018 1/31/2018 1/31/2018 Total Inv. Limits Date Maturity

PUBLIC FINANCIAL MGT MANAGED FEDERAL AGENCY SECURITIES

07/08/16 3130A8DB6 - FHLB Notes 1.250% 0.770% 2.080% 2,000,000 2,020,680 1,973,958 2,500 (46,722) 06/21/19 567 08/04/16 3130A8Y72- FHLB Global Notes 0.875% 0.990% 2.120% 800,000 797,232 785,290 3,422 (11,942) 08/05/19 612 04/20/17 3130AAXX1 - FHLB Notes 1.375% 1.260% 1.990% 800,000 801,712 794,479 4,064 (7,233) 03/18/19 472 09/08/17 3130ACE26 - FHLB Notes 1.375% 1.480% 2.290% 465,000 463,507 454,114 2,185 (9,393) 09/28/20 1,032 05/06/16 3135G0J53 - FNMA Notes 1.000% 0.960% 1.980% 1,850,000 1,852,183 1,830,841 7,965 (21,342) 02/26/19 452 08/28/16 3135G0P49- FNMA Notes 1.000% 1.050% 2.090% 900,000 898,596 884,807 3,825 (13,789) 08/28/19 635 04/20/17 3135G0P49- FNMA Notes 1.000% 1.340% 2.090% 500,000 496,085 491,560 2,125 (4,526) 08/28/19 635 02/28/17 3135G0T29 - FNMA Notes 1.500% 1.520% 2.200% 530,000 529,661 522,552 3,379 (7,109) 02/28/20 819 07/31/17 3135G0T60 - FNMA Notes 1.500% 1.600% 2.270% 1,300,000 1,296,061 1, 275,899 54 (20,162) 07/30/20 972 07/08/16 3137EADZ9 - Freddie Mac Notes 1.250% 0.770% 2.030% 500,000 504,875 494,618 1,656 (10,257) 04/15/19 500 04/20/17 3137EAEB1 - FHLMC Notes 0.875% 1.310% 2.080% 700,000 693,273 687,864 204 (5,409) 07/19/19 595 04/20/17 3137EAEF2 - FHLMC Notes 1.375% 1.490% 2.210% 880,000 876,990 864,195 3,395 (12,795) 04/20/20 871 03/11/16 912828C65 - US Treasury Notes 1.625% 1.130% 2.000% 200,000 202,969 199,133 1,107 (3,836) 03/31/19 485 12/22/16 912828C65 - US Treasury Notes 1.625% 1.320% 2.000% 700,000 704,730 696,965 3,875 (7,766) 03/31/19 485 12/22/16 912828G61 - US Treasury Notes 0.625% 1.510% 2.130% 140,000 139,940 138,430 383 (1,509) 11/30/18 364 07/05/17 912828G61 - US Treasury Notes 1.500% 1.470% 2.130% 800,000 800,469 791,031 2,077 (9,438) 11/30/19 729 04/05/17 912828K58 - US Treasury Notes 1.375% 1.520% 2.200% 10,000 9,956 9,819 35 (137) 04/30/20 881 08/31/17 912828L32 - US Treasury Notes 1.375% 1.440% 2.250% 1,700,000 1,696,879 1,662,879 9,944 (34,000) 08/31/20 1,004 04/20/17 912828WL0 - US Treasury Notes 1.500% 1.220% 2.300% 75,000 75,439 74,481 195 (958) 05/31/19 546 06/28/17 912828XH8 - US Treasruy Notes 1.625% 1.500% 2.230% 495,000 496,779 488,039 711 (8,740) 06/30/20 942 07/07/17 912828XM7 - US Treasury Notes 1.625% 1.600% 2.240% 755,000 755,472 743,763 34 (11,709) 07/31/20 973 12/01/17 912828N48 - US Treasury Notes 1.750% 1.900% 2.300% 1,920,000 1,911,600 1,890,300 2,970 (21,300) 12/31/20 1,126 01/04/18 912828N89 - US Treasury Notes 1.375% 2.050% 2.320% 1, 800,000 1,763,930 1,751,134 68 (12,796) 01/31/21 1,157

Sub-Totals 1.375% 2.161% 19,820,000 19,789,018 19,506,153 PFM 56,174 (282,866) 19.2% No Limit 786

MEDIUM TERM NOTES / COMMERCIAL PAPER / OTHER

10/31/16 0258M0EC9 - American Express Notes 1.700% 1.740% 2.450% 100,000 99,881 98,722 430 (1,159) 10/30/19 698 02/28/17 0258M0EE5 - American Express Notes 2.200% 2.240% 2.570% 210,000 209,782 208,434 1,899 (1,348) 03/03/20 823 04/30/17 0258M0EK1 - American Express Notes 1.875% 1.900% 2.360% 350,000 349,857 347,888 1,604 (1,968) 05/03/19 518 02/16/17 02665WBM2 - American Honda Finance Corp Notes 2.000% 2.050% 2.480% 130,000 129,815 128,772 1,206 (1,044) 02/14/20 805 07/20/17 02665WBT7 - American Honda Finance Corp Notes 1.950% 1.980% 2.540% 60,000 59,939 59,162 36 (778) 07/20/20 962 11/16/17 02665WBZ3 - American Honda Finance Notes 2.000% 2.030% 2.370% 250,000 249,860 248,397 1,042 (1,464) 11/13/19 712 02/09/17 037833CK4 - Apple Bonds 1.900% 1.920% 2.320% 350,000 349,829 347,129 3,214 (2,700) 02/07/20 798 05/11/17 037833CS7 - Apple Bonds 1.800% 1.840% 2.410% 130,000 129,867 128,262 520 (1,605) 05/11/20 892 09/12/17 037833CZ1 - Apple Notes 1.500% 1.540% 2.200% 175,000 174,850 173, 075 1,014 (1,775) 09/12/19 650 02/03/17 05531FAS2 - BB&T Corp Note 2.450% 2.080% 2.520% 350,000 353,684 349,502 381 (4,182) 01/15/20 775 10/26/17 05531FAZ6 - Branch Banking & Trust Corp Notes 2.150% 2.170% 2.750% 50,000 49,977 49,136 284 (841) 10/26/17 (36) 09/18/17 06051GGS2 - Bank of America Notes 2.328% 2.328% 2.650% 435,000 435,000 430,081 3,741 (4,919) 10/01/21 1,400 08/09/17 06406HCW7 - Bank of New York Notes 2.300% 1.780% 2.400% 400,000 404,252 399,357 3,578 (4,895) 09/11/19 649 04/06/14 06417GUE6 - Bank of Nova Scotia CD 1.910% 1.910% 1.460% 700,000 700,000 696,847 4,420 (3,154) 04/05/19 490 02/09/17 06427KRC3 - Bank of Montreal Chicago CD 1.880% 1.900% 1.820% 700,000 700,000 700,152 6,361 152 02/07/19 433 09/27/17 06539RGM3 - Bank of Tokyo Misubishi CD 2.070% 2.070% 2.010% 440,000 440,000 437,177 3,213 (2,823) 09/25/19 663 08/15/16 084664CK5 - Berkshire Hathaway Financial Global Notes 1.300% 1.330% 2.230% 160,000 159,845 157,754 959 (2,091) 08/15/19 622 09/12/17 09659CF86 - BNP Paribas Commercial Paper 0.000% 0.000% 1.820% 600,000 593,275 596,137 - 2,862 06/08/18 189 12/05/16 13606A5Z7 - Canadian Imperial Bank CD 1.760% 1.780% 1.980% 600,000 599,532 598,705 1,789 (827) 11/30/18 364 09/07/17 14913Q2A6 - Caterpillar Finanicial Service Notes 1.850% 1.880% 2.520% 330,000 329,723 324,509 2,442 (5,214) 09/04/20 1,008 06/24/16 166764BH2 - Chevron Corp Global Notes 1.561% 1.350% 2.240% 500,000 502,925 495,709 1,626 (7,216) 05/16/19 531 09/20/16 17275RBG6 - Cisco Systems Corp Notes 1.400% 1.440% 2.310% 310,000 309,656 305,499 1,579 (4,157) 09/20/19 658 11/03/17 172967KB6 - Citigroup Corp Notes 2.650% 2.340% 2.750% 200, 000 201,798 199,470 1,399 (2,328) 10/26/20 1,060 01/10/17 172967LF6 - Citigroup Corp Notes 2.450% 2.460% 2.610% 180,000 179,928 179,444 257 (484) 01/10/20 770 04/30/17 19416QEF3 - Colgate-Palmolive Notes 1.750% 1.550% 2.160% 390,000 391,447 388,254 2,578 (3,193) 03/15/19 469 10/31/17 22533UE25 - Credit Agricole NY Commercial Paper 0.000% 1.600% 1.740% 600, 000 595,151 597,371 - 2,221 10/30/17 (32) -110- 09/20/17 22549LFP5 - Credit Suisse New York CD 1.610% 1.610% 1.850% 800,000 800,000 799,264 4,794 (736) 06/15/18 196 06/22/17 2422ETS8 - John Deere Corp Notes 1.950% 1.970% 2.470% 70,000 69,957 69,160 148 (798) 06/22/20 934 03/15/17 24422ET02 - John Deere Notes Corp Notes 2.200% 2.230% 2.470% 150,000 149,883 149,169 1,265 (714) 03/13/20 833 02/07/17 24422ETM1 - John Deere Corp Corp Notes 1.650% 1.610% 2.050% 190,000 190,125 189,473 923 (652) 10/15/18 318 03/06/17 25468PDP8 - Walt Disney Company Notes 1.950% 1.960% 2.340% 80,000 79,979 79,374 637 (605) 03/04/20 824 04/24/17 25468PDP8 - Walt Disney Company Notes 1.950% 1.700% 2.340% 250,000 251,743 248,044 1,991 (3,699) 03/04/20 824 06/13/17 25468PDU7 - Walt Disney Notes 1.800% 1.840% 2.380% 100,000 99,884 98,689 280 (1,196) 06/05/20 917 12/27/16 30231GAP7 - Exxon Mobil Corp Notes 1.708% 1.730% 2.190% 400,000 399,852 397,942 2, 847 (1,910) 03/01/19 455 12/13/16 38145GAJ9 - Goldman Sachs Bonds 1.760% 2.330% 2.630% 310,000 309,768 308,148 951 (1,619) 12/13/19 742 11/03/17 38148LAA4 - Goldman Sachs Group Notes 2.600% 2.280% 2.720% 130,000 130,980 129,659 920 (1,321) 04/23/20 874 06/05/17 437076BQ4 - Home Depot Corp Notes 1.800% 1.820% 2.370% 190,000 189,890 187,531 532 (2,359) 06/05/20 917 10/30/17 438516BQ8 - Honeywell International Notes 1.800% 1.840% 2.310% 125,000 124,903 123,914 569 (989) 10/30/17 (32) 09/08/17 44932HAB9 - IBM Corp Notes 1.800% 1.860% 2.610% 250,000 249,483 244,261 138 (5,222) 01/20/21 1,146 05/11/17 458140AZ3 - Intel Corp Notes 1.850% 1.860% 2.260% 400,000 399,848 396,364 1,644 (3,484) 05/11/20 892 10/10/17 4581X0CD8 - Inter-American Development Bank CD 2.125% 1.810% 2.390% 440,000 444,078 436,838 2,130 (7,240) 11/09/20 1,074 04/12/17 4581X0CX4 - Inter-American Devel Note 1.625% 1.700% 2.270% 390,000 389,076 384,393 1,391 (4,682) 05/12/20 893 08/23/17 459058FS7 - International Bank of Recon CD 1.125% 1.900% 2.260% 530,000 525,653 519,352 1,060 (6,301) 11/27/19 726 03/21/17 459058FZ1 - International Bank Notes 1.875% 1.900% 2.310% 350,000 349,696 346,738 1,823 (2,958) 04/21/20 872 08/29/17 459058GA5 - International Bank of Recon Notes 1.625% 1.630% 2.390% 440,000 439,908 431,557 3,019 (8,350) 09/04/20 1,008 09/19/17 45905UP32 - International Bank of Reconstruction Notes 1.561% 1.640% 2.500% 440,000 438,944 429,640 2,518 (9,304) 09/12/20 1,016 01/27/17 459200JN2 - IBM Corp Notes 1.900% 1.930% 2.460% 390,000 389,626 385,802 82 (3,824) 01/27/20 787 02/21/17 46625HKA7 - JP Morgan Chase & Co. Notes 2.250% 2.220% 2.540% 320,000 320,298 318,240 160 (2,057) 01/23/20 783 04/24/17 46625HKA7 - JP Morgan Notes & Co. Notes 2.250% 2.000% 2.540% 150,000 151,002 149,175 75 (1,827) 01/23/20 783 02/06/17 594918BV5 - Microsoft Corp Notes 1.850% 1.870% 2.320% 190,000 189,873 188,261 1,709 (1,612) 02/06/20 797 02/03/17 61747YDW2 - Morgan Stanley Corp Bonds 2.650% 2.350% 2.660% 180, 000 181,557 179,966 53 (1,591) 01/27/20 787 12/08/16 65558LWA6 - Nordea Bank Finland NY CD 1.760% 1.740% 1.700% 600,000 600,000 600,181 1,848 181 11/30/18 364 11/13/17 69371RN85 - Paccar Financial Notes 2.050% 2.050% 2.510% 120,000 119,989 118,529 533 (1,460) 11/13/20 1,078 04/30/17 713448DR6 - Pepsi Notes 1.550% 1.590% 2.210% 180,000 179,865 178,545 690 (1,320) 05/02/19 517 10/10/17 713448DX3 - Pepsi Corp Notes 2.000% 2.010% 2.580% 165,000 164,967 162,086 1,018 (2,881) 04/15/21 1,231 11/21/16 717081EB5 - Pfizer Corp Notes 1.700% 1.720% 2.300% 200,000 199,856 197,807 434 (2,049) 12/15/19 744 08/04/17 83050FXT3 - Skandinav Enskilda Banken CD 1.840% 1.850% 2.190% 850,000 849,669 837,812 7,863 (11,856) 08/02/19 609 06/13/17 857477AS2 - State Street Corp Notes 2.550% 1.940% 2.520% 400,000 407,496 400,285 4,618 (7,211) 08/18/20 991 05/04/17 86563YVNO - Sumitomo Mitsui Bank CD 2.500% 2.050% 1.370% 820,000 820,000 818,436 4,203 ( 1,564) 05/03/19 518 01/12/17 86958JHB8 - Svenkska CD 1.890% 1.910% 2.350% 700,000 700,000 696,759 809 (3,241) 01/10/19 405 11/17/17 87019U6D6 - Swedbank (New York) CD 2.270% 2.300% 2.640% 440,000 440,000 435,981 2,109 (4,019) 11/16/20 1,081 02/09/17 89113WWJ1 - Toronto Dominion Bank CD 1.480% 1.500% 1.570% 600,000 600,000 599,798 8,806 (202) 03/14/18 103 04/17/17 89236TDU6 - Toyota Motor Notes 1.950% 1.970% 2.430% 240,000 239,890 237,544 1,352 (2,346) 04/17/20 868 04/17/17 89236TDU6 - Toyota Motor Notes 1.950% 1.940% 2.430% 260,000 260,078 257,339 1,465 (2,739) 04/17/20 868 11/14/17 9113128BP0 - United Parcel Service Bond 2.050% 2.100% 2.550% 350,000 349,447 344,736 1,535 (4,711) 04/01/21 1,217 08/18/16 91159HHH6 - US Bancorp Notes 2.200% 1.280% 2.250% 400,000 409,660 399,751 2,347 (9,909) 04/25/19 510 08/30/17 92826CAB8 - Visa Corp Notes 2.200% 1.850% 2.440% 110,000 111,210 109,283 316 12/14/20 1,109 10/20/17 931142EA7 - Walmart Corp Notes 1.900% 1.950% 2.340% 440,000 439,362 434,579 2,345 (4,783) 12/15/20 1,110 08/07/17 96121T4A3 - Westpac Banking Corp CD 2.050% 2.050% 2.200% 790,000 790,000 785,930 7,828 (4,070) 08/03/20 976 01/08/18 2422ETZ2 - John Deere Capital Corp Notes 2.350% 2.370% 2.580% 110,000 109,943 109,294 165 (649) 01/08/21 1,134 01/18/18 06538CK4 - Bank of Tokyo Mitsubish Commercial Paper 0.000% 2.050% 2.070% 600,000 591,011 591,343 - 332 10/12/18 315 01/25/18 45950KCM0 - International Finance Corp Notes 2.250% 2.250% 2.460% 350,000 348,971 347,925 111 (1,047) 01/25/21 1,151

Sub-Totals 1.830% 2.203% 24,690,000 24,697,287 24,499,839 PFM 127,623 (195,521) 24.1% 30% 675

TOTAL PFM MANAGED 1.628% 2.185% 44,510,000 44,486,306 44,005,991 PFM 183,797 (478,387) 43.3% 724

PADRE DAM MWD MANAGED OTHER CASH & INVESTMENTS Local Agency Investment Fund 1.350% 1.350% 21,412,123 21,412,123 21,412,123 LAIF 5,000 0 21.1% 30,000,000 1 Bank of NY Trustee (2004/2009 COP funds) 0.000% 0.000% 83 83 83 BNY x 0 0.0% na 1 Union Bank of California - Money Market 1.660% 1.660% 177,791 177,791 177,791 Bank Stmt. x 0 0.2% 20% 1 Calif. Bank & Trust Money Market & Savings 0.030% 0.030% 9,062,393 9,062,393 9,062,393 Bank Stmt. x 0 8.9% 20% 1 Checking, Park Checking, Petty Cash & Other Cash 0.015% 0.015% 17,513,423 17,513,423 17,513,423 Bank Stmt. x 0 17.2% 1 TOTAL PADRE DAM MANAGED 0.617% 0.617% 48,165,814 48,165,814 48,165,814 5,000 - 47.4% 1

TOTAL CASH & INVESTMENTS (before COP) 1.102% 1.366% 92,675,814 92,652,119 92,171,805 188,797 - 90.7% 346

Bank of NY Trustee (2009 COP funds) Construction Fund 0.950% 0.950% 9,445,169 9,445,169 9,445,169 BNY x 0 9.3% na 1 Bank of NY Trustee (2009 COP funds) Debt Reserve Fund 0.040% 0.040% - - - BNY x 0 0.0% na 1 TOTAL 2009 COP FUNDS 0.950% 0.950% 9,445,169 9, 445,169 9, 445,169 - 9.3% 1

TOTAL CASH & INVESTMENTS 1.088% 1.327% 102,120,983 102,097,288 101,616,974 188,797 - 100.0% 314

Page 14 PADRE DAM MUNICIPAL WATER DISTRICT Monthly Treasurer's Report CASH AND INVESTMENT SUMMARY (Total) January 31, 2018

INVESTMENT BY TYPE MARKET VALUE COMMERCIAL PAPER 24.1%

LOCAL AGENCY -111- FEDERAL AGENCY INVESTMENT SECURITIES 21.1% 19.2%

COP BNY Trustee 9.3% MONEY MARKET FUNDS/CHECKING 26.3% CASH & INVESTMENT SUMMARY

Page 15 A PADRE DAM MUNICIPAL WATER DISTRICT Monthly Treasurer's Report CASH AND INVESTMENT SUMMARY (excluding COP Funds) January 31, 2018

INVESTMENT BY TYPE MARKET VALUE COMMERCIAL PAPER 26.6%

FEDERAL AGENCY SECURITIES 21.2% -112-

LOCAL AGENCY INVESTMENT 23.2%

MONEY MARKET FUNDS/CHECKING 29.0%

Page 15 B PADRE DAM MUNICIPAL WATER DISTRICT Monthly Treasurer's Report January 31, 2018

MAJOR INVESTMENT YIELD COMPARISONS YTM at COST 8.00%

7.00%

6.00%

5.00%

4.00%

3.00%

2.00%

1.00%

0.00% Jul-14 Sep-14 Nov-14 Jan-15 Mar-15 May-15 Jul-15 Sep-15 Nov-15 Jan-16 Mar-16 May-16 Jul-16 Sep-16 Nov-16 Jan-17 Mar-17 May-17 Jul-17 Sep-17 Nov-17 Jan-18

PFM LAIF

Month-Year L. A. I. F. P . F. M. BALANCE INTEREST BALANCE INTEREST Yield at Cost Yield at Cost Jul-14 21,812,693 0.244% 22,275,477 0.551% Aug-14 21,818,206 0.260% 22,298,747 0.600% Sep-14 21,812,693 0.246% 22,275,018 0.600% Oct-14 21,831,500 0.261% 22,308,949 0.600% Nov-14 21,831,500 0.261% 22,320,837 0.600% Dec-14 21,831,500 0.267% 22,270,979 0.600% Jan-15 21,845,488 0.262% 21,828,981 0.605% Feb-15 21,845,488 0.266% 21,795,596 0.605% Mar-15 21,845,488 0.278% 21,806,981 0.605% Apr-15 22,510,488 0.283% 21,801,544 0.605% May-15 22,524,498 0.290% 21,793,066 0.605% Jun-15 22,524,498 0.299% 21,787,600 0.732% Jul-15 22,540,322 0.320% 30,713,015 0.753% Aug-15 22,540,322 0.330% 30,793,033 0.767% Sep-15 22,540,322 0.337% 30,845,143 0.767% Oct-15 22,558,471 0.357% 30,804,467 0.767% Nov-15 22,558,471 0.374% 30,772,207 0.892% Dec-15 21,058,471 0.400% 30,724,334 0.919% Jan-16 21,079,017 0.446% 30,873,429 0.919% Feb-16 21,079,017 0.467% 30,878,689 0.919% Mar-16 21,079,017 0.506% 30,783,018 0.967% Apr-16 21,103,349 0.525% 30,768,353 0.967% May-16 21,103,349 0.552% 30,911,114 0.991% Jun-16 21,103,349 0.576% 31,071,511 1.000% Jul-16 21,111,284 0.588% 31,049,956 1.000% Aug-16 21,111,284 0.614% 30,898,770 1.006% Sep-16 21,132,060 0.634% 31,015,763 1.009% Oct-16 21,164,169 0.654% 31,119,728 1.021% Nov-16 21,164,169 0.678% 30,978,222 1.031% Dec-16 21,164,169 0.718% 34,975,860 1.145% Jan-17 21,200,218 0.751% 35,352,101 1.214% Feb-17 21,200,218 0.777% 35,129,325 1.270% Mar-17 21,200,218 0.821% 35,106,154 1.286% Apr-17 21,240,777 0.884% 41,151,873 1.336% May-17 21,240,777 0.925% 41,218,618 1.368% Jun-17 21,240,777 0.978% 41,193,090 1.397% Jul-17 21,289,692 1.051% 44,391,070 1.420% Aug-17 21,289,692 1.084% 44,396,325 1.473% Sep-17 21,289,692 1.111% 44,272,825 1.487% Oct-17 21,347,314 1.143% 44,313,186 1.509% Nov-17 21,347,314 1.172% 44,253,033 1.541% Dec-17 21,347,314 1.239% 44,205,616 1.572% Jan-18 21,412,123 1.350% 44,005,991 1.628%

Page 16-A -113- PADRE DAM MUNICIPAL WATER DISTRICT Monthly Treasurer's Report January 31, 2018

Annualized Quarterly Comparison 12 Month Return PFM Performance vs Merrill Lynch 1 to 3 Yr Treasury Index 3.00% 2.50% 2.00% 1.50% 1.00% 0.50% 0.00% -0.50%

PFM Merrill Lynch

As of PFM Merrill Lynch Quarter 12 Month Return 12 Month Return Ending Sep-10 1.44% 2.53% Dec-10 1.28% 2.35% Mar-11 1.21% 1.67% Jun-11 0.99% 1.34% Sep-11 0.84% 1.20% Dec-11 1.01% 1.55% Mar-12 1.02% 1.44% Jun-12 0.55% 0.79% Sep-12 0.49% 0.56% Dec-12 0.46% 0.43% Mar-13 0.48% 0.64% Jun-13 0.60% 0.33% Sep-13 0.14% 0.37% Dec-13 0.20% 0.36% Mar-14 0.33% 0.38% Jun-14 0.89% 0.76% Sep-14 0.65% 0.50% Dec-14 0.66% 0.62% Mar-15 0.80% 1.00% Jun-15 0.67% 0.88% Sep-15 0.96% 1.16% Dec-15 0.45% 0.54% Mar-16 1.03% 0.92% Jun-16 1.37% 1.31% Sep-16 1.00% 0.88% Dec-16 1.05% 0.89% Mar-17 0.46% 0.25% Jun-17 0.28% -0.11% Sep-17 0.68% 0.24% Dec-17 N/A N/A Not Available Note: These percentages include the yield at cost and current market gain (or loss) so results can be significantly higher or lower than the yield at cost due to volatile market behavior.

Page 16-B -114- PADRE DAM MUNICIPAL WATER DISTRICT January 31, 2018 I. California Bank Loan Financial Requirements: Required 1/31/2018 Meets Loan Requirement (a) Minimum DSC Ratio Operating Income before interest, depreciation & amortization 17,723,125 Annual Debt Service 4,324,637 1.5 to 1 4.10 to 1 YES

(d) Maximum Total Debt to Tangible Net Worth Ratio Total Liabilities 114,870,517 Total Fund Equity (Assets - Liabilities) 250,459,148 .5 to 1 0.46 to 1 YES

(e) Minimum Cash and Investments Current Cash & Investments 7,500,000 82,781,954 YES

NOTE: Interest Rate on CB&T $5,000,000 loan is based on 61% of the prime rate. Interest rate for the current month is 2.135%. (Current balance is $1.8 million)

II. Certificate of Participation (COP) Rate Covenant Ratio Requirements:

(a) "District Net Revenues" / (Annual Installment Payments + Debt Service on Parity Debt)

Minimum Required January 31, 2018 Meets COP Requirement District Net Revenues (as defined in Official Statement) 11,934,466 Annual Installment Payments+Debt Service on Parity Debt 2,522,705 Resulting Ratio (minimum must be met on annual basis) 1.20 4.73 YES

(b) "District Net Revenues" - (Rate Stabilization and Capital Repl Funds) / (Annual Installment Payments + Debt Service on Parity Debt)

Minimum Required January 31, 2018 Meets COP Requirement District Net Revenues, excluding Rate Stab and Capital Repl Funds 11,404,700 Annual Installment Payments+Debt Service on Parity Debt 2,522,705 Resulting Ratio (minimum must be met on annual basis) 1.05 4.52 YES

(c) "Water System Net Revenues" / (Annual Installment Payments on Water System Debt + Debt Service on Water System Parity Debt)

Minimum Required January 31, 2018 Meets COP Requirement Water System Net Revenues (as defined in Official Statement) 7,319,950 Annual Installment Payments+Debt Service on Parity Debt (WATER SYSTEM ONLY) 2,282,799 Resulting Ratio (minimum must be met on annual basis) 1.00 3.21 YES

-115-Page 17 PADRE DAM MUNICIPAL WATER DISTRICT

GLOSSARY OF TERMS

AGENCIES:

Debt instrument(s) issued by US Government agencies, departments, and government-sponsored corporations. Some agencies have a direct government guarantee, others have an implied government guarantee. All agency securities are of the highest credit quality.

AMORTIZED COST:

The original cost of the principal adjusted for the periodic reduction of any discount or premium from the purchase date until the date of the report.

BANKERS ACCEPTANCE:

This is an investment instrument issued by a bank, guaranteeing the payment of a customer’s drafts for a stated amount for a specified period. It substitutes the bank’s credit for the buyer and eliminates the seller’s risk. This security is created out of a trade transaction.

BOOK VALUE:

The amount paid for the security inclusive of any accrued interest and premium/discount, and inclusive of any amortized premium/discount. A security that has a book value in excess of face value was purchased with accrued interest or at a premium; thus, the yield-to-maturity on the security will be the same as or less than the stated rate. A security that has a book value less than face value was purchased at a discount; thus, the yield to maturity will always be in excess of the stated rate.

CERTIFICATES OF DEPOSIT:

A security instrument representing specific cash deposits in commercial banks, having varying maturities and yields based on size and maturity. This security has pooled collateral pledged against the deposit.

COMMERCIAL PAPER:

Primarily used by large corporations to finance receivables. Commercial paper is a short term, unsecured promissory discount note that usually pays interest at maturity.

COUPON:

The interest rate on a debt security that an issuer promises to pay.

DAYS TO MATURITY:

The number of days remaining from the reporting date until the maturity of the security on a weighted average basis.

DURATION:

A measure of the sensitivity of a security’s price to a change in the market value. Values from 1.0 to 3.0 are considered conservative. For example, a portfolio with a duration of 1.5 would increase 1.5% for every 1% decrease in market.

MARKET % OF PORTFOLIO:

The percentage of each security type as compared to total investments.

18a -116- MARKET VALUE:

The current market value of the security. This is based on the price a security can be traded in the market at the close of the month.

MATURITY DATE:

The date in which the security matures. With managed pool accounts and passbook/checking accounts there are no maturity dates as these accounts are ongoing.

NEGOTIABLE CERTIFICATES OF DEPOSIT:

Securities that are issued by major international and domestic banks and are similar to certificates of deposits purchased at a local bank; however, unlike collateralized certificates of deposit they are liquid with an active secondary market for strong issuers.

PAR VALUE:

The stated maturity value of a security or remaining face amount.

PURCHASE DATE:

The day in which the security was delivered to the Authority’s safekeeping account.

TREASURY BILL:

Obligations issued by the United States Treasury with a maturity of under one year and having virtually no risk.

TREASURY NOTE:

Obligations issued by the United States Treasury with a maturity ranging from one to ten years, paying interest semiannually and having virtually no risk.

UNREAL G/L ON BOOK:

The unrealized gain or loss on book is the difference between the amortized cost of the security as of the report date and the market value.

YTM AT COST:

The yield to maturity at cost is the rate of return based on the original cost, the annual interest receipts, maturity value and the time period from purchase date to maturity.

YTM AT MARKET:

The yield to maturity at market is the rate of return based on the current market value, the annual interest receipts, the maturity value and the time period remaining until maturity.

18b -117-