The Fallbrook Public Utility District exceeded its water and wastewater fund balance goals, and the difference will be transferred from the operating fund into the capital fund.
A 5-0 FPUD board vote Sept. 23 transferred $870,000 of water operating division balance to the water capital fund while transferring $600,000 of the recycled operating division fund balance to the recycled water capital improvement fund. The other $40,000 of the recycled water balance remained in the operating fund to cover a $37,000 deficit which is due to the State Revolving Fund loan for the wastewater treatment plant rehabilitation project.
“We had additional surpluses in several of the fund balances,” said FPUD general manager Brian Brady. “It was certainly a welcome development.”
The 2013-14 fund balance goal set for the water operating division was $3,933,462. The fund balance as of June 30, 2013, was $4,803,554. The fund balance goal for the recycled operating division was $225,508 while the actual June 30 fund balance was $867,212.
“We’re gratified that we sold more water than what we had forecasted in the budget,” Brady said.
The water capital projects will likely include the asphalt liner for Red Mountain Reservoir, which requires significant repairs to extend its life and avoid a multi-million dollar full replacement with concrete. FPUD has budgeted $300,000 for that project, but after finalizing the approach and working with contractors the anticipated cost could be at least twice that much due to the specialty equipment required for the reservoir slope.
FPUD has also deferred the replacement of a small bolted tank due to budget constraints; the tank is corroding and could result in water quality concerns if it is not replaced. The FPUD board budgeted $100,000 to replace the tank, but after FPUD and San Diego Gas & Electric discussed the cost to provide the needed electrical power to the site the cost to replace the tank may be double of what was budgeted.
The remaining amount of the money transferred to the water capital fund could be used to help supplement the pipeline replacement budget, which will help FPUD replace the highest-priority corroded sections which are at risk of leaking.
Prior to the allocation of the wastewater fund balance, all recycled water system capital improvements were funded from the wastewater capital improvement fund. The establishment of a recycled water capital improvement fund may allow for a source of funds for future recycled water capital improvement projects including pipeline expansions.
FPUD’s recycled water master plan has identified several pipeline extensions to increase demands, which would increase the recycled water program’s long-term revenue.
The Wastewater Treatment Plant is being funded by a $28.7 million State Revolving Fund loan which will be paid back over a 20-year period at an interest rate of approximately 2.2 percent.