West Bench Water: Where does the money go?

There have been some massive changes in the West Bench water system over the last few years:

  1. The West Bench Irrigation District (WBID) disbanded after two generations of managing water on the West Bench.
  2. The RDOS entered into an agreement with the City of Penticton to buy treated water instead of pulling water directly from the lake,
  3. The RDOS has taken over billing, instituted a parcel tax for capital improvements (the new supply and distribution system) and added water meters.

To help make some sense of this, I have included below an analysis of revenues and expenditures for the West Bench water system under the RDOS.  Revenues are shown as positive numbers and expenses are shown as negative numbers.  The two do not match (revenues do not equal expenditures) because I have suppressed several types of financial transactions: 

  1. Revenue: grants (one time)
  2. Revenue: transfers from reserve
  3. Revenue: prior years surplus
  4. Expense: principle and interest
  5. Expense: transfer to reserves

 

These items are excluded in order to focus on the stead-state operating cost of the utility.

Here is my analysis over the last few years.  The important thing to notice on the revenue side is that the balance of tax and fees has changed dramatically (user fees for "renewal" have largely been replaced by the parcel tax for the upgrade project). However, the sum of these two (fees + parcel taxes) has not increased much.  Sure, this is still a huge number, but the total cost to you is not increasing at a discernable rate.

The expense side is a mess because there have been so many one-off expenses associated with the upgrade.  Since many of these were funded out of grant money, they have been suppressed from the analysis.  Again, my focus is on steady-state expenses, such as operations, labor, and so on.  Still, you can see the massive growth in the "Consultant" bar in 2013 as we built the upgraded system.  This is a huge increase with and easily-explainable one-time cause.  As such, we do not read too much into it.

(link to larger image)

You will notice if you look at the graph that the cost of  labor and operations is increasing from 2014 to to 2015.  The upgrade is mostly competed so these can be seen as steady-state changes.  However, the big spike in labor has its origins in the upgrade project:  water meters need to be read and and the data from the meters needs to be analyzed and accounted for in billing for the service. Ultimately, much of this will be done by utilities billing software.  However, the RDOS currently does not own sophisticated billing software and thus incorporating West Bench water usage data into the billing process will--at least at first--involve lots of manual effort.   RDOS staff has included an allowance for manual effort in the 2015 West Bench water budget.

Issues: 
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