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Home My WebLink About11-05-25 Board Packet1 OTAY WATER DISTRICT AND OTAY WATER DISTRICT FINANCING AUTHORITY BOARD OF DIRECTORS MEETING 2554 SWEETWATER SPRINGS BOULEVARD SPRING VALLEY, CALIFORNIA WEDNESDAY November 5, 2025 3:30 P.M. AGENDA 1. ROLL CALL 2. PLEDGE OF ALLEGIANCE 3. APPROVAL OF AGENDA 4. APPROVAL OF THE MINUTES OF THE REGULAR BOARD MEETING ON OCTOBER 1, 2025 5. PUBLIC PARTICIPATION – OPPORTUNITY FOR MEMBERS OF THE PUBLIC TO SPEAK TO THE BOARD ON ANY SUBJECT MATTER WITHIN THE BOARD’S JURIS- DICTION INCLUDING AN ITEM ON TODAY’S AGENDA The District’s meeting is live streamed. Information on how to watch and listen to the Dis- trict’s meeting can be found at this link: https://otaywater.gov/board-of-directors/agenda- and-minutes/board-agenda/ ACTION ITEMS 6. BOARD a) APPOINTMENT OF DISTRICT SECRETARY (CALIFORNIA WATER CODE §71340; OTAY WATER DISTRICT CODE OF ORDINANCES, CHAPTER 2, §1.02 and §1.07) (JOSE MARTINEZ) CONSENT ITEMS 7. ITEMS TO BE ACTED UPON WITHOUT DISCUSSION, UNLESS A REQUEST IS MADE BY A MEMBER OF THE BOARD OR THE PUBLIC TO DISCUSS A PARTICULAR ITEM: a) AWARD TWO (2) PROFESSIONAL SERVICES CONTRACTS FOR AS-NEEDED IN- PLANT INSPECTION SERVICES AND AUTHORIZE THE GENERAL MANAGER TO 2 EXECUTE TWO (2) AGREEMENTS WITH ON-SITE TECHNICAL SERVICES, INC. AND KENNY CONSULTING SERVICES, EACH IN AN AMOUNT NOT-TO-EXCEED $450,000 FOR A PERIOD OF THREE (3) FISCAL YEARS. THE TOTAL AMOUNT OF THE TWO (2) AGREEMENTS WILL NOT EXCEED $450,000 DURING FISCAL YEARS 2026-2028 (ENDING JUNE 30, 2028) (BRANDON DIPIETRO) b) APPROVE THE SETTING OF JANUARY 7, 2026, AS A PUBLIC HEARING DATE ON A POSSIBLE CONDEMNATION ACTION AND AUTHORIZE THE DISTRICT COUN- SEL TO SEND A LEGAL NOTICE TO DAVID AND ALYSSA HAWLEY PRIOR TO FIL- ING AN EMINENT DOMAIN ACTION WITH THE SAN DIEGO SUPERIOR COURT (LITO SANTOS) c) ADOPT ORDINANCE NO. 602 TO ADD A FIRE FLOW FEE AND APPROVE THE PROPOSED CHANGES TO VARIOUS FEES AND CHARGES BY AMENDING AP- PENDIX A AND SECTION 38, SERVICES FOR FIRE PROTECTION SYSTEMS, OF THE DISTRICT’S CODE OF ORDINANCES TO BE EFFECTIVE JANUARY 1, 2026 (ANDREA CAREY) ACTION ITEMS 8. BOARD a) APPROVE THE AUDITED FINANCIAL STATEMENTS, INCLUDING THE INDEPEND- ENT AUDITORS’ UNQUALIFIED OPINION, FOR THE FISCAL YEAR ENDING JUNE 30, 2025 (MARISSA DYCHITAN) b) DISCUSS THE 2025 AND 2026 BOARD MEETING CALENDARS (JENNY DIAZ) INFORMATIONAL ITEM 9. THE FOLLOWING ITEM IS PROVIDED TO THE BOARD FOR INFORMATIONAL PUR- POSES ONLY. NO ACTION IS REQUIRED ON THE FOLLOWING AGENDA ITEMS: a) UPDATE ON THE CUSTOMER COMMUNICATION PLAN FOR THE UPCOMING DIS- TRICT-WIDE METER CHANGEOUT PROJECT (ANDREA CAREY) b) GENERAL MANAGER’S EXECUTION OF AN EMERGENCY AGREEMENT WITH CASS-ARRIETA CONSTRUCTION TO REPAIR THE OTAY WATER DISTRICT’S 12- INCH WATER MAIN ON JAMUL DRIVE IN JAMUL, CAUSED BY A MAIN LEAK (CHARLES MEDEROS) REPORTS 10. GENERAL MANAGER’S REPORT 11. SAN DIEGO COUNTY WATER AUTHORITY UPDATE 12. DIRECTORS' REPORTS/REQUESTS 3 13. PRESIDENT’S REPORT/REQUESTS OTAY WATER DISTRICT FINANCING AUTHORITY 14. NO MATTERS TO DISCUSS 15. ADJOURNMENT All items appearing on this agenda, whether or not expressly listed for action, may be deliber- ated and may be subject to action by the Board. The Agenda, and any attachments containing written information, are available at the District’s website at www.otaywater.gov. Written changes to any items to be considered at the open meeting, or to any attachments, will be posted on the District’s website. Copies of the Agenda and all attachments are also available by contacting the District Secretary at (619) 670-2253. If you have any disability which would require accommodation to enable you to participate in this meeting, please call the District Secretary at (619) 670-2253 at least 24 hours prior to the meet- ing. Certification of Posting I certify that on October 31, 2025, I posted a copy of the foregoing agenda near the regular meeting place of the Board of Directors of Otay Water District, said time being at least 72 hours in advance of the regular meeting of the Board of Directors (Government Code Section §54954.2). Executed at Spring Valley, California on October 31, 2025. /s/ Jenny Diaz, District Secretary 1 MINUTES OF THE BOARD OF DIRECTORS MEETINGS OF THE OTAY WATER DISTRICT AND OTAY WATER DISTRICT FINANCING AUTHORITY October 1, 2025 1.The meeting was called to order by President Lopez at 3:35 p.m. 2.ROLL CALL Directors Present:Directors Gonzalez, Lopez, Rivera, and Robak Directors Absent:Director Croucher Staff Present:General Manager Jose Martinez, General Counsel Dan Shinoff, Chief Financial Officer Joe Beachem, Chief of Administration Adolfo Segura, Asst. Chief of Finance Kevin Koeppen, System Operations Manager Jake Vaclavek Cameron, District Secretary Tita Ramos-Krogman and others per attached list. 3.PLEDGE OF ALLEGIANCE 4.APPROVAL OF AGENDA A motion was made by President Lopez to have Agenda Item 9a (High School Internship Program Update) presented to the board after Agenda Item 4 (Approval of the Agenda). The motion was seconded by Director Gonzalez and carried with the following vote: Ayes: Directors Gonzalez, Lopez, Rivera, and Robak Noes: None Abstain: None Absent: Director Croucher to present Agenda Item 9a, High School Internship Program Update, following the approval of the agenda. 5.HIGH SCHOOL INTERNSHIP PROGRAM UPDATE Chief of Administrative Services Adolfo Segura provided the staff report to the board and displayed a draft flyer (Attachment A of the staff report). He introduced Mr. Antonio Guiterrez, Program Manager of Career Technical Education Office of College and Career Readiness from Sweetwater Union High School District, to provide additional details of the internship program. Mr. Segura and Mr. Guiterrez responded to questions and comments from the board. AGENDA ITEM 4 2 6. APPROVAL OF THE MINUTES OF THE REGULAR BOARD MEETING OF SEPTEMBER 3, 2025, AND SPECIAL BOARD MEETING OF SEPTEMBER 8, 2025 A motion was made by Director Rivera, seconded by Director Gonzalez, and carried with the following vote: Ayes: Directors Gonzalez, Lopez, Rivera, and Robak Noes: None Abstain: None Absent: Director Croucher to approve the minutes of the regular board meeting of September 3, 2025, and special board meeting of September 8, 2025. 7. 2025 END-OF-YEAR LEGISLATIVE UPDATE Communications Officer Tenille Otero provided the staff report to the board and introduced Baltazar Cornejo, BHFS Policy Advisor, who attended the meeting via Zoom to present a PowerPoint Presentation of the 2025 end-of-year legislative update. Ms. Otero and Mr. Cornejo responded to questions and comments from the board. 8. PUBLIC PARTICIPATION – OPPORTUNITY FOR MEMBERS OF THE PUBLIC TO SPEAK TO THE BOARD ON ANY SUBJECT MATTER WITHIN THE BOARD'S JURISDICTION BUT NOT AN ITEM ON TODAY'S AGENDA No one wished to be heard. PUBLIC HEARING 9. PUBLIC HEARING ON RATES AND CHARGES THE BOARD WILL BE HOLDING A PUBLIC HEARING ON THE PROPOSED SEWER RATES AND CHARGES; AND IF NO MAJORITY PROTEST IS RECEIVED: a) ADOPT ORDINANCE NO. 601 APPROVING THE METHODOLOGIES USED IN THE COST OF SERVICE STUDY, ADOPTING THE FIVE-YEAR SCHEDULE (PRESENTED IN ATTACHMENT C) OF RATES AND CHARGES DEVELOPED USING THOSE METHODOLOGIES TO MEET THE DISTRICT’S REVENUE REQUIREMENTS AS PROPOSED IN THE FY 2025-2026 OPERATING AND CAPITAL BUDGET, AND AMENDING SECTION 53 OF THE CODE OF ORDINANCES (CONDITIONS FOR SEWER SERVICE AND APPENDIX A; AND AUTHORIZE, FOR A PERIOD OF FIVE YEARS, PURSUANT TO GOVERNMENT CODE SECTION 53756, TO PASS THROUGH UNFORSEEN INFLATIONARY INCREASES DIRECTLY TO CUSTOMERS 3 IN FUTURE YEARS IF OVERALL INFLATION OR CONSTRUCTION INFLATION INCREASES EXCEED PROJECTED ASSUMPTIONS, AS FOLLOWS: • IF THE ANNUAL CHANGE IN THE CONSUMER PRICE INDEX (CPI) FOR THE SAN DIEGO CARLSBAD AREA AS OF JANUARY 31 OF THE PRECEDING YEAR EXCEEDS THE ASSUMED RATE FOR THE APPLICABLE YEAR, THE DISTRICT WILL PASS THROUGH THE DIFFERENCE • IF THE CITY OR COUNTY RATES EXCEED 6.0% IN ANY YEAR, OR 8.88% IN FY 2028, THE DISTRICT WILL PASS THROUGH THE DIFFERENCE • IF THE ANNUAL CHANGE IN THE ENGINEERING NEWS RECORD COST CONSTRUCTION INDEX (CCI), MEASURED FEBRUARY TO FEBRUARY OF THE FOLLOWING YEAR, EXCEEDS THE ASSUMED RATE FOR THE APPLICABLE YEAR, THE DISTRICT WILL PASS THROUGH THE DIFFERENCE Assistant Chief Financial Officer Kevin Koeppen provided a PowerPoint presentation to the board. President Lopez opened the public hearing at 4:21 p.m. District Secretary Tita Ramos-Krogman stated that the district did not receive any protest letters or comments from the public. Mr. Koeppen responded to questions and comments from the board. With no further comments from the board and no public protest and comments from the public, President Lopez closed the public hearing at 4:38 p.m. A motion was made by Director Robak, seconded by Director Rivera and carried with the following vote: Ayes: Directors Gonzalez, Lopez, Rivera, and Robak Noes: None Abstain: None Absent: Director Croucher to approve staff’s recommendations. 4 ACTION ITEMS 10. BOARD a) ADOPT RESOLUTION NO. 4462 OF THE BOARD OF DIRECTORS OF OTAY WATER DISTRICT APPOINTING DIRECTOR FRANCISCO X. RIVERA AS THE NEW REPRESENTATIVE TO THE BOARD OF DIRECTORS OF THE SAN DIEGO COUNTY WATER AUTHORITY (FIRST SEAT) General Manager Jose Martinez stated that as a result of the excused medical condition of Director Gary Croucher, staff is recommending that the board adopt Resolution No. 4462 to appoint a new director to the San Diego County Water Authority (First Seat). The remaining term of this seat will terminate in March 2026. A motion was made by President Lopez, seconded by Director Robak and carried with the following vote: Ayes: Directors Gonzalez, Lopez, Rivera, and Robak Noes: None Abstain: None Absent: Director Croucher to adopt Resolution No. 4462 of the Board of Directors of Otay Water District appointing Director Francisco X. Rivera to the San Diego County Water Authority (First Seat). b) ADOPT RESOLUTION NO. 4463 TO CONFIRM DIRECTORS FRANCISCO X. RIVERA AND MARK ROBAK AS THE OTAY WATER DISTRICT’S REPRESENTATIVES TO THE SAN DIEGO COUNTY WATER AUTHORITY, EACH TO VOTE IN THE ABSENCE OF THE OTHER A motion was made by Director Robak, seconded by Director Gonzalez and carried with the following vote: Ayes: Directors Gonzalez, Lopez, Rivera, and Robak Noes: None Abstain: None Absent: Director Croucher to adopt Resolution No. 4463 of the Board of Directors of Otay Water District to confirm Directors Francisco X. Rivera and Mark Robak as the Otay Water District’s representatives to the San Diego County Water Authority each to vote in the absence of the other. c) AUTHORIZE THE GENERAL MANAGER TO CHANGE INSURANCE CARRIER AND ENTER INTO A THREE-YEAR AGREEMENT WITH NEW YORK LIFE INSURANCE FOR THE DISTRICT’S LIFE, ACCIDENTAL DEATH AND DISMEMBERMENT, AND SHORT/LONG-TERM DISABILITY 5 INSURANCE FROM JANUARY 1, 2026, THROUGH DECEMBER 31, 2028, IN AN APPROXIMATE AMOUNT OF $265,827 (BASED ON CURRENT CENSUS INFORMATION AND SUBJECT TO CHANGE) Human Resources Manager Suzie Lawson provided the staff report and responded to questions and comments from the board. A motion was made by President Lopez, seconded by Director Gonzalez and carried with the following vote: Ayes: Directors Gonzalez, Lopez, Rivera, and Robak Noes: None Abstain: None Absent: Director Croucher to approve staff’s recommendations. d) AUTHORIZE THE GENERAL MANAGER TO AWARD A CONTRACT TO MERINO LANDSCAPE, INC. TO COMPLETE PHASE II OF THE ADMINISTRATION BUILDING LANDSCAPE UPDATE IN AN AMOUNT NOT- TO-EXCEED $417,309 Purchasing Manager Kent Payne provided the staff report and responded to questions and comments from the board. A motion was made by Director Rivera, seconded by President Lopez and carried with the following vote: Ayes: Directors Gonzalez, Lopez, Rivera, and Robak Noes: None Abstain: None Absent: Director Croucher to approve staff’s recommendation. e) DISCUSS THE 2025 BOARD MEETING CALENDAR District Secretary Tita Ramos-Krogman provided dates for the October 2025 committee meetings. No changes were made to the board calendar. INFORMATIONAL ITEM 11. THE FOLLOWING ITEM IS PROVIDED TO THE BOARD FOR INFORMATIONAL PURPOSES ONLY. NO ACTION IS REQUIRED ON THE FOLLOWING AGENDA ITEM: a) ANNUAL DIRECTORS’ EXPENSE REPORT FOR FISCAL YEAR 2025 6 Accountant Miriam Perez provided a PowerPoint presentation to the board and responded to their questions and comments. b) FISCAL YEAR 2025 YEAR-END REPORT OF THE DISTRICT’S FISCAL YEAR 2023-2026 STRATEGIC PLAN Information Technology Manager Michael Kerr provided a PowerPoint presentation and responded to questions and comments from the board. c) SOCIAL MEDIA, MOBILE APPLICATION, AND WEBSITE ANALYTICS UPDATE Communications Assistant Eileen Salmeron provided a PowerPoint presentation and responded to questions and comments from the board. REPORTS 11. GENERAL MANAGER REPORT General Manager Martinez shared information on FBI briefing for San Diego Critical Infrastructure Partners and provided an update on the district’s FY 2025 Audit. He also shared that the Operations management team received formal recognition and appreciation from the American Water Works Association (AWWA) for their significant contributions to the revision of the AWWA M44 Distribution Valves Manual. 12. SAN DIEGO COUNTY WATER AUTHORITY UPDATE Director Robak provided an update on CWA matters discussed at its September 25, 2025, board meeting. 13. DIRECTORS' REPORTS/REQUESTS Written reports from Directors Gonzalez, Lopez, Rivera, and Robak were submitted to District Secretary Ramos-Krogman, which will be attached to the minutes for today’s meeting. 14. PRESIDENT’S REPORT A written report from President Lopez will be submitted to District Secretary Ramos- Krogman and will be attached to the minutes for today’s meeting. 15. CLOSED SESSION The board recessed to closed session at 5:40 p.m. to discuss the following matters: a) CONFERENCE WITH REAL PROPERTY NEGOTIATORS Pursuant to California Government Code §54956.8 7 Property: SALT CREEK GOLF COURSE 525 HUNTE PARWAY CHULA VISTA, CA 91914 Agency negotiator: General Counsel Under negotiation: Disposition of Property b) THREATENED LITIGATION GOVERNMENT CODE §54956.9 CLAIMANT: Robinhood Point Association c) CONFERENCE WITH LEGAL COUNSEL – EXISTING LITIGATION [GOVERNMENT CODE §54956.9] MARK COZIAHR, ET AL. vs. OTAY WATER DISTRICT, CASE NO. 37-2015- 000-CU-MC-CTL RETURN TO OPEN SESSION 16. REPORT ON ANY ACTIONS TAKEN IN CLOSED SESSION. THE BOARD MAY ALSO TAKE ACTION ON ANY ITEMS POSTED IN CLOSED SESSION The board reconvened from closed session at 7:25 p.m. and General Counsel Dan Shinoff reported that no reportable actions were taken. OTAY WATER DISTRICT FINANCING AUTHORITY 17. NO MATTERS TO DISCUSS There were no items scheduled for discussion for the Otay Water District Financing Authority board. 18. ADJOURNMENT With no further business to come before the Board, President Lopez adjourned the meeting at 7:25 p.m. President ATTEST: District Secretary Mark Robak From:9/1/2025 9/30/2025 ITEM DATE MEETING PURPOSE / ISSUES 1 9/3/2025 Otay Water District Monthly Board Meeting 2 9/4/2025 San Diego Regional Chamber of Commerce Sustainability & Industry Committee 3 9/4/2025 Sweetwater Authority Ribbon-cutting ceremony for the new Shared Maintenance Road and Trail - NO CHARGE 4 9/4/2025 San Diego Regional Chamber of Commerce Mixer at SDSU Mission Valley - NO CHARGE 5 9/5/2025 East County Chamber of Commerce First Friday Breakfast - NO CHARGE 6 9/8/2025 Otay Water District Special Board Meeting - 870-2 Reservoir Tour 7 9/16/2025 East County Chamber of Commerce Government Affairs Committee - NO CHARGE 8 9/16/2025 CSDA San Diego Chapter Water Utilities Committee Lunch meeting to hear Jennifer Pierre, General Manager, State Water Contractors 9 9/17/2025 East County Economic Development Council Board Meeting at Grossmont College 10 9/18/2025 Otay Mesa Chamber of Commerce Awards Reception - NO CHARGE 11 9/21/2025 California WateReuse Conference Annual Conference 12 9/22/2025 California WateReuse Conference Annual Conference 13 9/23/2025 California WateReuse Conference Annual Conference 14 9/25/2025 East County Chamber of Commerce Monthly Board Meeting 15 9/29/2025 Otay Water District Salt Creek Ad-Hoc Committee 16 9/30/2025 East County Economic Development Council Manufacturing Expo at Cuyamaca College - NO CHARGE OTAY WATER DISTRICT BOARD OF DIRECTORS PER-DIEM AND MILEAGE CLAIM FORM Pay To:Period Covered Employee Number STAFF REPORT TYPE MEETING: Regular Board MEETING DATE: November 5, 2025 PROJECT: Various DIV. NO. All SUBMITTED BY: Jose Martinez, General Manager APPROVED BY: Joseph Beachem, Chief Financial Officer Jose Martinez, General Manager SUBJECT: APPOINT NEW DISTRICT SECRETARY AS SECRETARY TO THE BOARD OF DIRECTORS GENERAL MANAGER'S RECOMMENDATION: That the Board of Directors appoint the new District Secretary as the Secretary to the Board of Directors. PURPOSE: To request the Board’s approval to appoint the new District Secretary as the Secretary to the Board of Directors. ANALYSIS: The current District Secretary will be retiring on December 30, 2025. Through a competitive recruitment process, the current Confidential Executive Assistant was selected for the District Secretary position, effective October 20, 2025. Section 71340 of the California Water Code provides that the Board of Directors of Municipal Water Districts shall appoint the Secretary to the Board of Directors. In addition, Chapter 2, Section 1.02 of the District’s Code of Ordinance states the following: “B. District Officers. The Board shall appoint officers of the District as required by law, including a Secretary,…” Since the District Secretary performs work for the Board of Directors, this staff report serves as a request for the Board to approve appointing the same individual to serve as the Secretary to the Board of Directors. AGENDA ITEM 6a 2 FISCAL IMPACT: Joe Beachem, Chief Financial Officer None. STRATEGIC GOAL: This program aligns with the strategic objective of learning and growth by fostering a workforce culture of development and innovation. LEGAL IMPACT: None. STAFF REPORT TYPE MEETING: Regular Board MEETING DATE: November 5, 2025 SUBMITTED BY: Brandon DiPietro Field Services Manager PROJECT: VARIOUS DIV. NO. All APPROVED BY: Kevin Cameron, Engineering Manager Michael Long, Chief, Engineering Jose Martinez, General Manager SUBJECT: Award of Two (2) As-Needed In-Plant Inspection Services Contracts to On-Site Technical Services, Inc. and Kenny Consulting Services, Inc. for Fiscal Years 2026-2028 GENERAL MANAGER’S RECOMMENDATION: That the Otay Water District (District) Board of Directors (Board) award two (2) professional services contracts for As-Needed In-Plant Inspection Services and authorize the General Manager to execute two (2) agreements with On-Site Technical Services, Inc. (On-Site) andKenny Consulting Services (KCS), each in an amount not-to-exceed$450,000 for a period of three (3) Fiscal Years. The total amount of the two (2) agreements will not exceed $450,000 during Fiscal Years2026-2028 (ending June 30, 2028). COMMITTEE ACTION: Please see Attachment A. PURPOSE: To obtain Board authorization for the General Manager to enter into two (2) professional services agreements for As-Needed In-Plant Inspection Services with On-Site and KCS, with each agreement in an amount not-to-exceed $450,000 for Fiscal Years 2026-2028. The total amount of the two (2) agreements will not exceed $450,000 during Fiscal Years 2026-2028. AGENDA ITEM 7a 2 ANALYSIS: The District will require the services of a professional in-plant inspection consultant in support of the District’s Capital Improvement Program (CIP) and developer funded projects for the next three (3) fiscal years. Due to the strict requirements for the weld inspection, surface preparation, and coating application on steel pipelines, the District uses a third-party inspector to monitor, document, and verify welding reports and to ensure coatings are applied per District and coating manufacturer’s specifications. The District requires the specialty inspector to be certified by the American Welding Society as a Certified Welding Inspector (CWI) or Senior Certified Welding Inspector (SCWI) qualified to code AWS D1.1 QC1, American Society for Nondestructive Testing (ASNT) SNT-TC-1A as a NDT Level II or greater, and National Association of Corrosion Engineers (NACE) as a Level III Coating Inspector. The inspector’s tasks include, but are not limited to, submitting daily reports detailing the manufacturer’s activities, periodic testing, and overall quality control for the manufacturer’s procedures. It is more efficient and cost effective to issue an as-needed contract for In-Plant Inspection Services, which will provide the District with the ability to obtain consulting services in a timely and efficient manner. This concept has also been used in the past for other disciplines such as design engineering, construction management, geotechnical, and environmental services. The anticipated CIP and developer projects that are estimated to require in-plant inspection services for Fiscal Years 2026-2028 are listed below: CIP No. & Dev No. Capital Facilities & Developer Projects P2058 PL - 20-Inch, 1296 Zone, Proctor Valley Road from Melody Road to Highway 94 P2171 PL - 20-Inch, 1296 Zone, Proctor Valley Road from Pioneer Way to Melody Road P2195 PL - 24 - Inch, 640 Zone, Campo Road - Regulatory Site/Millar Ranch P2196 PL - 24 - Inch, 640 Zone, Millar Ranch Road to 832-1 Pump Station D0362 Otay 200 D0712 International Industrial Park D1044 Otay Ranch Village 8 East 3 The District solicited for in-plant inspection services by placing an advertisement on the Otay Water District’s website and using PlanetBids, the District’s online bid solicitation website on July 24, 2025. The advertisement was also placed in the Daily Transcript. Five (5) firms submitted a Letter of Interest (LOI) and a Statement of Qualifications (SOQ). The Request for Proposal (RFP) for As-Needed In-Plant Inspection Services was sent to five (5) firms for which they submitted proposals. These are: • PdM Consulting, Inc., Oceanside, CA • On-Site Technical Service, Inc., Garden Grove, CA • Kenny Consulting Services, Inc., San Diego, CA • Verdantas, Inc, Irvine, CA • Certerra RMA Group, Inc., San Diego, CA A panel of five (5) staff members reviewed the proposals and conducted interviews with PdM, On-Site, KCS, Verdantas, and Certerra. Staff agreed that KCS and On-site are well qualified to perform the services based on their experience, understanding of the scope of work, proposed method to accomplish the work, and their composite hourly rate. KCS and On-Site submitted the Company Background Questionnaire, as required by the RFP, and staff did not find any significant issues. In addition, staff checked their references and conducted an internet search on the companies. Staff found the references to be excellent and did not find any outstanding issues with the internet search. FISCAL IMPACT: Joe Beachem, Chief Financial Office The funds for these two (2) agreements will be expended from the Fiscal Years 2026, 2027, and 2028 budgets for a variety of projects, as previously noted above. These agreements are for as-needed professional services based on the District's need and schedule, and expenditures will not be made until a task order is approved by the District for the consultant's services on a specific CIP or development project. Based on a review of the financial budgets, the Project Manager anticipates that the budgets will be sufficient to support the professional as-needed services required for the CIP and developer projects noted above. The Finance Department has determined that the funds to cover these agreements will be available as budgeted for these projects. 4 GRANTS/LOANS: Engineering staff researched and explored grants and loans and found none available for this Project. STRATEGIC GOAL: This Project supports the District’s Mission statement, “To provide exceptional water and wastewater service to its customers, and to manage District resources in a transparent and fiscally responsible manner” and the General Manager’s Vision, "To be a model water agency by providing stellar service, achieving measurable results, and continuously improving operational practices." LEGAL IMPACT: None. BD:jf Attachments: Attachment A – Committee Action Attachment B – Summary of Proposal Rankings ATTACHMENT A SUBJECT/PROJECT: VARIOUS Award of Two (2) As-Needed In-Plant Inspection Services Contracts to On-Site Technical Services, Inc. and Kenny Consulting Services, Inc. for Fiscal Years 2026-2028 COMMITTEE ACTION: The Engineering, Operations, and Water Resources Committee (Committee) reviewed this item at a meeting held on October 21, 2025, and the following comments were made: • The Committee discussed the authorization of two professional services agreements for in-plant inspection services for Fiscal Years 2026 - 2028, with a combined total not to exceed $450,000, awarded to On- Site Technical Services (On-Site) and Kenney Consulting Services (KCS). • In response to the Committee’s inquiry, staff responded that these companies not only use certified welding inspectors during construction and manufacturing, but that they also verify that all welders are certified within the last three years. • It was noted that these services are required to support CIP and developer-funded water projects, involving specialized inspection of steel pipe manufacturing, coating, and lining at various plants in Southern California and Arizona. Following the discussion, the Committee supported staff’s recommendation and presentation to the full board as a consent item. Qualifications of Team Responsiveness and Project Understanding Technical and Management Approach INDIVIDUAL TOTAL - WRITTEN AVERAGE WRITTEN TOTAL Consultant's Commitment to DBE Additional Creativity and Insight Strength of Project Manager Presentation & Communication Skills Responses to Questions INDIVIDUAL TOTAL - ORAL AVERAGE ORAL TOTAL TOTAL SCORE WITHOUT FEE Proposed Fee TOTAL SCORE 30 25 30 85 85 Y/N 15 15 10 10 50 50 135 15 150 Poor/Good/ Excellent Brandon DiPietro 22 20 21 63 10 13 7 7 37 Kevin Cameron 22 20 22 64 9 10 5 4 28 Aaron Hazard 15 18 15 48 8 10 7 6 31 Lito Santos 21 17 22 60 9 10 7 5 31 Michael O'Donnell 25 17 23 65 8 9 6 5 28 Brandon DiPietro 21 20 19 60 12 10 8 5 35 Kevin Cameron 20 18 20 58 8 10 6 3 27 Aaron Hazard 15 21 17 53 8 9 10 6 33 Lito Santos 22 16 22 60 10 10 7 6 33 Michael O'Donnell 24 18 24 66 8 10 7 4 29 Brandon DiPietro 20 20 19 59 10 10 7 7 34 Kevin Cameron 23 20 23 66 10 10 6 5 31 Aaron Hazard 20 18 18 56 8 8 7 6 29 Lito Santos 22 19 22 63 10 11 7 7 35 Michael O'Donnell 25 17 23 65 9 9 7 5 30 Brandon DiPietro 25 23 26 74 11 12 8 8 39 Kevin Cameron 27 23 27 77 12 13 8 7 40 Aaron Hazard 22 16 28 66 9 12 9 9 39 Lito Santos 25 23 26 74 13 13 8 9 43 Michael O'Donnell 27 23 26 76 13 14 8 8 43 Brandon DiPietro 28 24 28 80 14 14 9 9 46 Kevin Cameron 28 25 28 81 14 14 8 9 45 Aaron Hazard 28 22 28 78 12 15 9 10 46 Lito Santos 27 24 28 79 14 14 9 9 46Michael O'Donnell 28 23 28 79 14 14 8 9 45 Notes: Consultant Fee Score 1. Review Panel does not see or consider proposed fee when scoring other categories. The proposed fee is scored by Engineering staff not on the Review Panel. KCS $225 15 2. The fees were evaluated by comparing rates for four catagories. The sum of these 4 rates are noted on the table to the left. On-Site $270 11 Certerra $308 8 PdM $330 6 Verdantas $388 1 FEE SCORING CHART REFERENCES 59 Y Y 691 MAXIMUM POINTS 97 913190VERDANTAS1 ATTACHMENT B SUMMARY OF PROPOSAL RANKINGS - As-Needed In-Plant Inspection Services FY 2026-2028 WRITTEN ORAL 31PdM60 8 102 KCS 73 Y 41 114 15 129 Excellent CERTERRA 62 Y 32 94 136 ExcellentON-SITE 79 Y 46 125 11 STAFF REPORT TYPE MEETING: Regular Board MEETING DATE: November 5, 2025 SUBMITTED BY: Lito Santos Senior Civil Engineer PROJECT: P2058-001102 DIV. NO. 5 APPROVED BY: Beth Gentry, Engineering Manager Michael Long, Chief, Engineering Jose Martinez, General Manager SUBJECT: Approval to set date for Public Hearing Date for January 7, 2026, for Condemnation Action and Authorize District Counsel to send a Legal Notice to Owners GENERAL MANAGER’S RECOMMENDATION: That the Otay Water District (District) Board of Directors (Board) approve the setting of January 7, 2026 as a public hearing date on a possible condemnation action and authorize the District Counsel to send a legal notice to David and Alyssa Hawley prior to filing an Eminent Domain Action with the San Diego Superior Court. COMMITTEE ACTION: Please see Attachment A. PURPOSE: To obtain Board authorization to set January 7, 2026 as a public hearing date on a possible condemnation action and authorize the District Counsel to send a legal notice to David and Alyssa Hawley prior to filing Eminent Domain Action with the San Diego Superior Court. AGENDA ITEM 7b 2 ANALYSIS: The Capital Improvement Project (CIP) P2058 PL - 20-Inch Proctor Valley Road from Melody Road to Highway 94 is scheduled to replace 1,600 feet of 12-inch potable water pipeline within the 1296 Pressure Zone (PZ) in Proctor Valley Road in Jamul, CA. The concrete cylindrical spiral-wound steel pipeline has been repaired three (3) times and was identified in the 2015 Water Facilities Master Plan Update for upsizing to a 20-inch pipeline. During design it was discovered that a majority of the existing road was on private property. To safely replace and maintain the waterline requires an easement acquisition on the existing road from six (6) private properties. District staff contracted with Bender Rosenthal Incorporated (BRI) to conduct appraisal services on all 6 properties. BRI provided the appraised fair market value to acquire a waterline easement on a portion of the owner’s property mostly within the existing road. District staff made multiple communication efforts to the property owners over the past year. On November 18, 2024, staff sent letters to all six (6) properties offering the Fair Market Value to acquire a waterline easement. On December 10, 2024, staff conducted a public outreach meeting with half of the owners in attendance. Staff went over the project and answered questions and concerns from the owners. Attendees requested additional easement language. After careful consideration by the District’s Counsel, the easement language was changed to reflect the property owner’s requests. To date five (5) of the six (6) owners have accepted the District’s offers. The property owner at 13958 Proctor Valley Road (see Exhibits A & B), owned by David and Alyssa Hawley, responded to the initial correspondence and Alyssa Hawley was present during the appraisal inspection on May 24, 2024. On November 18, 2024, staff sent David and Alyssa Hawley an offer letter for the fair market value to acquire a waterline easement. Since then, the Hawley’s have remained unresponsive to correspondence efforts made by staff sent after the offer letter, including numerous follow up letters (12/24/24, 05/29/2025) and phone calls and voicemails (12/3/24, 12/4/24, 12/23/24, 01/15/25, 02/05,25). District staff met with legal counsel on August 19, 2025 and sent the last outreach letter to the owners on October 15, 2025 to the property address and an additional address listed as a residence of David Hawley. The Public Hearing allows for the property owner(s) to appear and state their concerns. After the Public Hearing, the District Board can then adopt a formal Resolution of Necessity. This Resolution 3 formally authorizes the condemnation action and confirms the public use and necessity of the project. The legal notice sent by the District’s Legal Counsel to the property owners, David and Alyssa Hawley, is a formal notification prior to filing an Eminent Domain Action with the San Diego Superior Court. FISCAL IMPACT: Joe Beachem, Chief Financial Officer The total budget for CIP P2058, as approved in the FY 2026 budget, is $3,500,000. Total expenditures, plus outstanding commitments and forecast, are $3,500,000. See Attachment B for the budget detail. Based on a review of the financial budget, the Project Manager anticipates that the budget for the CIP is sufficient to support the Project. The Finance Department has determined that, under the current rate model, 31% of the funding is available from the Expansion Fund and 69% of the funding is available from the Replacement Fund. GRANTS/LOANS: Engineering staff researched and explored grants and loans and found none available for this Project. STRATEGIC GOAL: This Project supports the District’s Mission statement, “To provide exceptional water and wastewater service to its customers, and to manage District resources in a transparent and fiscally responsible manner” and the General Manager’s Vision, "To be a model water agency by providing stellar service, achieving measurable results, and continuously improving operational practices." LEGAL IMPACT: General Counsel has advised that this is the next necessary step in the Eminent Domain process, which would enter the District into litigation. LS/BG:jf Attachments: Attachment A – Committee Action Attachment B – P2058 Budget Detail Exhibit A – Location Map Exhibit B – Aerial Map of Easement to be Acquired ATTACHMENT A SUBJECT/PROJECT: P2058-001102 Approval to set date for Public Hearing Date for January 7, 2026, for Condemnation Action and Authorize District Counsel to send a Legal Notice to Owners COMMITTEE ACTION: The Engineering, Operations, and Water Resources Committee (Committee) reviewed this item at a meeting held on October 21, 2025, and the following comments were made: • Staff requested the Board set a public hearing for the January 7, 2026, meeting regarding a possible condemnation action related to the Pipeline Replacement Project on Proctor Valley Road in Jamul, CA. • Staff further requested that District Counsel send a legal notice to the sixth property owner, David and Alyssa Hawley, as they have been unresponsive to the District's offers and communication attempts since November 18, 2024. • These procedural steps are necessary before the District considers a formal adoption of resolution of necessity of the property and potentially files for eminent domain. Acquiring this easement is a critical path item for the replacement of the watermain, further delay risk the project's timeline, design, constructability, and service for the community. • The Committee and staff discussed the aerial map related to the easement acquisition, and the Committee sought clarification on the owner’s property line and parcel. Following the discussion, the Committee supported staff’s recommendation and presentation to the full board as a consent item. ATTACHMENT B – P2058 Budget Detail SUBJECT/PROJECT: P2058-001102 Approval to set date for Public Hearing Date for January 7, 2026, for Condemnation Action and Authorize District Counsel to send a Legal Notice to Owners 10/14/2025 Budget $ 3,500,000 Planning Standard Salaries 26,106 26,106 - 26,106 - Total Planning 26,106 26,106 - 26,106 Design Standard Salaries 178,170 178,170 100,000 278,170 45,700 28,740 16,960 45,700 BENDER ROSENTHAL INC 14,633 14,633 - 14,633 NINYO & MOORE GEOTECHNICAL 86,942 26,342 60,600 86,942 NV5 INC Service Contracts 34 34 - 34 DAILY JOURNAL CORPORATION Easement Acquisition 16,800 16,800 6,400 23,200 Total Design 178,170 178,170 183,960 362,130 Construction Standard Salaries 120,000 120,000 5,000 75,000 75,000 NV5 INC 75,000 75,000 Forecasted Construction Management Consultant 2,841,764 2,841,764 Forecasted Contractor Total Construction 5,000 - 3,111,764 3,111,764 Grand Total 209,276 204,276 3,295,724 3,500,000 Construction Contract Vendor/Comments Otay Water District P2058 - PL-20" 1296 PZ Proctor Valley Rd Melody/I-94 Committed Expenditures Outstanding Commitment & Forecast Projected Final Cost Consultant Contracts OTAY WATER DISTRICTRANCHO SAN DIEGO & JAMULPIPELINE REPLACEMENT PROJECTLOCATION MAP EXHIBIT A VARIOUS CIPsF C:\OneDrive\Otay Water District\ENG CIP - Documents\P2058 & P2171 Proctor Valley Road from Melody Road to Highway 94\Graphics\Exhibits-Figures\Exhibit A, Location Map.mxd 0 10,0005,000 Feet ÃÅ ÃÅ ÃÅ ÃÅ ÃÅ ÃÅ ÃÅ ÃÅ ÃÅ §¨¦ §¨¦ §¨¦ §¨¦ §¨¦ P2058 (Proctor Valley Rd) P2615 (Vista Grande) P2171 (Proctor Valley Rd) P2608 (Coronado Av) P2195 (Campo Rd) ^_ ^_ ^_^_ ^_P2196 (Millar Ranch Rd)^_ 5 8 8 805 805 94 94 125 125 125 125 905 905 54 DIV. 5 DIV. 2 DIV. 3 DIV. 4 DIV. 1 Proctor Valley Rd §¨¦805 ÃÅ125 ÃÅ94 ÃÅ905 VICINITY MAP PROJECT SITE DIV 5 DIV 1 DIV 2 DIV 4 DIV 3 ÃÅ54 !\ 0 5025 Feet CIP P2058 FPHASE ONE PROCTOR VALLEY NORTHCAPITAL IMPROVEMENT PROJECTEASEMENT LOCATION MAP OTAY WATER DISTRICT C:\ U s e r s \ o r e a d y \ O t a y W a t e r D i s t r i c t \ E N G C I P - D o c u m e n t s \ P 2 0 5 8 & P 2 1 7 1 P r o c t o r V a l l e y R o a d f r o m M e l o d y R o a d t o H i g h w a y 9 4 \ G r a p h i c s \ E x h i b i t s - F i g u r e s \ E a s e m e n t \ 5 9 7 - 2 3 0 - 1 2 - 0 0 _ E a s e m e n t - L o c a t i o n - M a p . a p r x F NTS 597-230-13-00 597-230-12-00 597-230-14-00 ROW Legend Proposed Water Easement 597-230-11-00 597-230-31-00 EXHIBIT B STAFF REPORT TYPE MEETING: Regular Board MEETING DATE: November 5, 2025 SUBMITTED BY: Andrea Carey, Customer Service Manager PROJECT: DIV. NO. All APPROVED BY: Joseph R. Beachem, Chief Financial Officer Jose Martinez, General Manager SUBJECT: Adopt Ordinance No. 602 to Approve the Addition of a Fire Flow Fee and the Proposed Changes to Various Fees and Charges by Amending Appendix A and Section 38, Service for Fire Protection Systems, of the District’s Code of Ordinances to be Effective January 1, 2026 GENERAL MANAGER’S RECOMMENDATION: That the Board adopt Ordinance No. 602 to add a fire flow fee and approve the proposed changes to various fees and charges by amending Appendix A and Section 38, Service for Fire Protection Systems, of the District’s Code of Ordinances to be effective January 1, 2026. COMMITTEE ACTION: See Attachment A. PURPOSE: To present to the Board, for consideration, the addition of a fire flow fee and proposed changes to various fees and charges listed in Appendix A, and to request that the Board approve these changes by adopting Ordinance No. 602, amending Section 38, Service for Fire Protection Systems, and Appendix A of the District’s Code of Ordinances. ANALYSIS: Periodically, the District analyzes fees to ensure all costs are recovered from the individual(s) benefiting from the service performed. In addition, staff reviews common deposits required by customers to verify if they are appropriate for the current period. AGENDA ITEM 7c The previous review was completed in 2023, therefore, sufficient time has passed to warrant another evaluation. Staff has prepared a cost analysis of various District fees and charges as outlined in Appendix A, and updates are recommended. The following sections will further explain these recommendations. Proposed Fee and Charge Changes For each fee, the amount of staff time spent on the activity was determined. Pertinent staff members were consulted to establish the average time spent completing each task in the field as well as any time spent in the office that was directly related to completing each task. Additionally, payroll personnel were asked to provide fully loaded labor rates. Using these labor rates and the average time spent completing a specific task, staff then determined the overall cost required to perform each service. To ensure financial equity to all rate payers, staff is recommending changes to the following fees and charges effective January 1, 2026, as shown in the table below. Code Numbers Item Current Fees Proposed Fees 23.04 Backflow Certification Second Notification $10.00 Remove Third Notification $25.00 $60.00 Third Notification ( hand delivered) $60.00 $110.00 Reconnection $60.00 Remove Reconnection (if technician present) $180.00 $230.00 Initial Filing Fee (New applicants for addition to the list of approve backflow prevention device testers) $25.00 $40.00 Renewal Filing Fee (to remain on the list of approved backflow prevention device testers) $10.00 Remove 31.03 A.4. Temporary Meter Install & Removal .75"-4" (on hydrant) $240.00 $280.00 4"-6" $960.00 $1,200.00 31.03 A.5. Temporary Meter Move Fee - includes backflow certification .75"-4" (on hydrant) $180.00 $210.00 4"-6" $960.00 $1,200.00 34.02 C Meter Lock Charge $60.00 $70.00 38.06 A Fire Flow Fee New $600.00 72.04 A.1. Locking or Removing Damaged or Tampered Meters Pull and Reset Meter .75"-2" $250.00 $310.00 Broken Lock/Locking Device .75"-1" $80.00 $95.00 Policy 54 Lien Processing Fee $55.00 $60.00 Policy 54 Delinquent Tax Roll Fee $45.00 $50.00 The fees and charges above are assessed to the customer’s water account after the work is performed. Staff has consulted with the District’s General Counsel who confirmed these fees are not subject to Proposition 218 noticing requirements. Most of the proposed fee changes are directly related to the increase in labor costs that have occurred since these fees were last updated. Changes to District practices, which are explained further in this document, also contributed to some of the proposed changes to fees. Additional information regarding the fees and charges is discussed below. Backflow Fees Staff are proposing the removal of the second notification fee. Backflow devices must be tested annually, and test reports must be submitted by the due date provided to the customer. Customers are notified of the due date 30 days in advance via mailed notice. If the test result is not submitted by the due date, a second notice is mailed, granting an additional 14 days to complete the test. This notice is mailed through the District’s third-party bill print vendor, Infosend. The cost associated with printing and mailing this notice is de minimis, therefore, staff proposes eliminating the second notification fee. If, after the 14-day extension, the District has still not received a passing test report, a third notice is mailed notifying the customer of impending disconnection. Staff is proposing an increase to the fee assessed for the mailing of this third notice to reflect higher labor costs and the additional time required to manage these accounts. In addition to the mailed notice, staff follow up with an email and phone call. The average time spent managing these delinquent accounts was used to calculate the proposed revised fee. As a final step prior to disconnection, staff hand-deliver a notice to the site to ensure the on-site manager is aware of the impending disconnection and can take the necessary steps to bring the backflow device into compliance. Although this can be time-consuming for District staff, this process has proven highly effective in minimizing disconnections. The proposed increase for this action reflects updated calculations of staff time and labor costs. If a customer fails to respond after these notifications, meter service is disconnected. Based on current District practices, staff recommend removing the existing reconnection fee of $60 because it is not applicable in reconnection of backflow as this process is not handled in the same manner as non-payment. Instead, staff recommends only listing one reconnection fee that is applicable for all backflow reconnections and updating the fee from $180 to $230. When a service is disconnected for backflow non-compliance, a Meter Services representative will lock the service and must return to the property to meet the tester and observe a passing test before reconnection. Given the total time spent on this process and the staff involved, the updated fee ensures full cost recovery of this effort. The last fee updates in this section are related to the approved backflow testers list. The District requires customers to use a District-approved backflow tester to test their backflow devices. The District recently transitioned to an online backflow reporting portal, SwiftComply. With this transition, the District no longer manually tracks backflow tester certifications or gauge calibrations; therefore, an official renewal requirement for testers is no longer necessary. Staff propose eliminating this fee. New testers who wish to perform testing within the District will still be required to apply, and the initial filing fee has been updated to reflect current labor costs. Temporary Meter Fees Temporary meters are meters used for construction purposes. The majority of these are 2½” meters attached to District fire hydrants (see photo below). Each temporary meter requires a backflow device to be tested and installed at the time the meter is set. District staff installs and removes all temporary meters and backflow devices for these 2½” meters. Staff is proposing an increase to the installation fee from $240 to $280 and to the move fee for the hydrant meters from $180 to $210, directly related to the increase in labor costs. On occasion, developers require a larger flow of water and must use a regular 4” or 6” meter (see photo on page 5). The installation of these larger meters is much more complex and requires two staff members but does not include backflow testing, as the customer is responsible for installing and testing the backflow device for these larger meters. The proposed fee increase from $960 to $1200 for these larger temporary meters is directly related to labor cost increases. Standard 2½” temporary meter/backflow device attached to hydrant for construction purposes. Larger 6” temporary meter installed for construction purposes. Lock Fees The meter lock charge is billed to customers whose service has been disconnected for non-payment. The District locks approximately 150- 200 meters per month. To determine the appropriate fee for disconnection and reconnection due to non-payment, staff analyzed the costs associated with locking and unlocking an account. Prior to locking a meter, Customer Service staff review each account on the day’s lock list. The final list is sent to the meter reading team. A meter reader then visits each property to turn off service and place a lock on the meter, along with a tag notifying the customer that the service has been interrupted and instructing them to call the District. The lock process takes approximately 15 minutes per account. To unlock the meter, the customer must pay the past-due amount. A Customer Service Representative verifies payments made throughout the day to locked accounts and creates service orders to unlock the meters for accounts that were paid. The meter reading team then returns to the property to unlock the meter. The unlock process takes approximately 20 minutes per account. Based on the average time of 35 minutes per account and the associated labor costs, staff is proposing an increase from $60 to $70. Staff completed a survey of neighboring agencies’ lock fees and the results are shown in the table on the following page. Water Agency Lock Fee Padre Dam Municipal Water District $60 Helix Water District $64 Sweetwater Authority $85 Although not required by law, the District will be notifying all customers in December, via a message on their water bill, of the lock fee increase. Pull Meter and Broken Lock Fees If a customer has been disconnected and tampers with the lock on their meter, staff will relock the meter and charge a broken lock fee. This fee recovers the cost of the broken lock and staff time associated with investigating the incident and relocking the meter. The proposed increase is only associated with increased labor costs as the cost of the lock remains the same. If a customer breaks the lock more than once, staff will pull the meter and install a locking device at the service line. The customer must pay the pull and reset meter fee and all past due charges to have the meter reinstalled. When a meter is pulled, a letter is mailed to the property and the property owner (if different from the account holder) explaining the meter has been pulled, the amount that must be paid for it to be reinstalled, and that any further tampering of the service could result in additional fines and possible prosecution. The increased cost to pull and reset the meter is due to increased labor costs. Lien Processing and Delinquent Tax Roll Fees California Water Code 72102 allows water districts to file liens with the County for unpaid water and sewer charges. In 2024, the District filed 17 liens. Staff is required to send an intent to lien letter 30 days prior to filing the lien with the County. The lien processing fee offsets staff time associated with this process. In addition to filing liens on the delinquent owner, staff sends delinquent owner account balances to the County of San Diego’s tax roll annually. These balances are then collected through the property’s tax bill and reimbursed to Otay. In 2025, the District sent $49,529 from 104 delinquent accounts to the County for collection. The delinquent tax roll fee covers the costs associated with identifying, noticing, and submitting these accounts to the County. The proposed increases to both of these fees are directly related to labor cost increases. Fire Flow Fee Currently, fire flow analysis is provided upon request at no cost to the requester. The District’s calibrated hydraulic model is used to provide fire flow pressure data; however, the work required to provide specific data is not currently recovered from the individual requester, even though the requester is the beneficiary of the information. The District model is used for internal purposes such as facility outages, planning for growth, and emergency scenarios. The cost of maintaining the model is excluded from the fire flow fee. The proposed fee of $600 is based on the average cost to provide the information. This fee is non-refundable. Fire flow analysis requiring the addition of new infrastructure to the model will be charged at actual costs incurred. No fee will be charged for fire flow requests submitted by another public agency. Neighboring agencies do charge a fee for this service summarized in the table below. Water Agency Fire Flow Fee Padre Dam Municipal Water District $150 Helix Water District $297 Sweetwater Authority $600 FISCAL IMPACT: Joe Beachem, Chief Financial Officer Based on the average number of occurrences for each fee, staff estimates an increase of approximately $98,000 in annual revenue, which includes an estimated $33,000 of cost recovery from the fire flow fee. The proposed fee and charge changes reflect the current labor rates and time involved for each task. Updating these fees help to ensure the financial equity of all rate payers as the fees are only charged to those customers that require these services. STRATEGIC GOAL: This revenue source will help the District meet its fiscal responsibility to its ratepayers. LEGAL IMPACT: None. Attachments: A) Committee Action Form B) Ordinance No. 602 Exhibit 1 - Section 38 Strike-through Exhibit 2 – Section 38 Proposed Exhibit 3 - Appendix A Strike-through Exhibit 4 - Appendix A Proposed ATTACHMENT A SUBJECT/PROJECT: Adopt Ordinance No. 602 to Approve the Addition of a Fire Flow Fee and the Proposed Changes to Various Fees and Charges by Amending Appendix A and Section 38, Service for Fire Protection Systems, of the District’s Code of Ordinances to be Effective January 1, 2026 COMMITTEE ACTION: The Finance & Administration Committee (Committee) reviewed this item at a meeting held on October 22, 2025, and the following comments were made: • Staff requested adoption of Ordinance 602 to add a fire flow fee and approve changes to various fees and charges, amending Appendix A and Section 38 (Service for Fire Protection Systems). Counsel confirmed these fees are not subject to Proposition 218 noticing requirements. • The Committee and staff discussed the process for fees, charges, and disconnections, emphasizing that extensive notifications are provided to help minimize disconnections. Following the discussion, the Committee supported staff’s recommendation and presentation to the full board as a consent item. 1 ORDINANCE NO. 602 AN ORDINANCE OF THE BOARD OF DIRECTORS OF THE OTAY WATER DISTRICT AMENDING SECTION 38, SERVICE FOR FIRE PROTECTION SYSTEMS; AND APPENDIX A OF THE DISTRICT’S CODE OF ORDINANCES BE IT ORDAINED by the Board of Directors of Otay Water District that the District’s Code of Ordinances Section 38, Service for Fire Protection Systems; and Appendix A be amended as per Exhibits 1 and 3 (attached). NOW, THEREFORE, BE IT RESOLVED that the new proposed Section 38, Service for Fire Protection Systems (Exhibit 2) and Appendix A (Exhibit 4) of the Code of Ordinances shall become effective on January 1, 2026. PASSED, APPROVED AND ADOPTED by the Board of Directors of the Otay Water District at a regular meeting duly held this 5th day of November 2025, by the following roll call vote: AYES: NOES: ABSENT: ABSTAIN: ________________________________ President ATTEST: ________________________ District Secretary Attachment B 38-1 SECTION 38 SERVICE FOR FIRE PROTECTION SYSTEMS 38.01 SERVICE FOR COMMERCIAL OR INDUSTRIAL PURPOSES The District will provide water service for fire pro- tection systems for commercial or industrial developments within the District. Such service shall be available only in accordance with the rules and regulations provided in this Code. 38.02 RULES AND REGULATIONS FOR FIRE HYDRANT AND/OR FIRE SPRINKLER SERVICE FOR COMMERCIAL OR INDUSTRIAL PURPOSES, OR MULTI-FAMILY RESIDENCES, ON PRIVATE PROPERTY A.All fire hydrant and/or fire sprinkler service mains installed for commercial or industrial purposes, or multi-family residences, on privately-owned land shall be owned and maintained by the land owner; except for fire hydrants installed for developments where the District has accepted an easement for such service mains. B.Where service is provided for fire hydrant or fire sprinkler service on privately-owned land under Paragraph A above, the service shall be provided by the District at the property line of the land to be served. The property owner or developer shall be responsible to construct and maintain the remainder of the facilities to pro- vide fire protection to the property. Each such facilities installation shall include a reduced pressure principle detector backflow prevention assembly (RPDA) device installed in accordance with District specifications, and tested annually in accordance with Section 23.04.G. of this code. The RPDA device shall be installed on the fire main located on the customer side of the property line. C.Water furnished for fire hydrant or fire sprin- kler service shall be used only for fire protec- tion purposes. Water service for domestic, business, commercial or irrigation purposes, or multi-family residences, shall be furnished only after a meter or meters have been installed on Exhibit 1 38-2 laterals connected to the District main in the street pursuant to requirements of this Code. D.Upon application for installation of one or more fire service connections to an existing District water main, the customer shall pay such charges as shall be determined on the basis of actual costs incurred by the District in performing the work. At the time of application for the installation, the District will estimate the total costs to be incurred in performing the work. The customer shall deposit the estimated amount with the District prior to commencement of the work. The work shall be performed by the District under a District Water/Sewer Order. If actual costs incurred by the District are less than the amount deposited, the District shall refund the balance of the deposit to the customer. If the costs incurred exceed the amount deposited, the customer shall reimburse the District for the additional costs. Where the fire service connection is to be made to a water main to be constructed in a street by the owner or developer, the costs for such connection shall be covered under the standard developer's agreement with the District for installation of the water facilities for the development project. E.Water for fire protection services shall be pro- vided in accordance with District fees and charges set forth in Section 25.03 D.16.(c) of this Code. F.The District shall have no responsibility for the proper function of the fire service system or for the availability of water from its mains for fire protection in the event of emergency. While the District undertakes at all times to have adequate supplies available in its system for ordinary uses, it is not a guarantor of continual service in quantities adequate for all purposes however, and each customer shall specifically agree that as a condition of the fire service connection contracted for that the District shall incur no liability or be subject to any damages resulting from a failure or 38-3 malfunctioning of the fire sprinkler lateral or fire sprinkler system or from a lack of water in adequate quantity or pressure to make it fully effective. 38.03 SERVICES FOR INDIVIDUALLY METERED RESIDENTIAL FIRE PROTECTION When a single-family residential water meter is required to provide standby capacity for a fire sprinkler system, the capacity charge may be determined according to the size of the meter necessary to meet the water use requirements for the property. Additional capacity fees for upsizing the single-family residential meter to meet fire flow requirements will be waived. Standby capacity to provide water for a fire sprinkler system is required when (1) the fire sprinkler system is required by law, including any requirement imposed as a condition of development, permit, or occupancy, and (2) the fire chief, fire marshal, or building official of the city, county, or special district responsible for fire protection service to the property has a requirement for additional meter size due to fire protection. The determination, under this section, shall be made at the time the meter is first obtained, or at the time a meter is replaced with one of greater size due to the later installation of a fire protection system. When a separate meter is required, water for fire protection services shall be provided in accordance with District fees and charges set forth in Section 25.03 D.16.(c) of this Code. 38.04 FIRE SPRINKLER SERVICE FOR COMBINED MULTI & SINGLE FAMILY SITES A.Master metered residential sites that contain both multi-family and single-family units, as designated by the fire department with jurisdiction, shall design and install the multi-family portion of the project in accordance with Section 38.02 (A through F). Portions of the site designated as single-family 38-4 shall design and install fire sprinklers as required by the fire agency with jurisdiction. The District requires all single-family residential homes to abide by the rules set forth in Section 38.05. 38.05 RULES AND REGULATIONS FOR SINGLE-FAMILY RESIDENTIAL PROPERTIES WITH FIRE PROTECTION SYSTEMS A.The District requires single-family residential homes with fire sprinklers to include an above- grade double check valve backflow prevention assembly unless all the following criteria are met: 1.The user premises has only one service connection to the PWS; 2.A single service line onto the user premises exists that subsequently splits on the property for domestic flow and fire protection system flow, such that the fire protection system may be isolated from the rest of the user premises; 3.A single, water industry standard, water meter is provided to measure combined domestic flow and fire protection system flow; 4.The fire protection system is constructed of piping materials certified as meeting NSF/ANSI Standard 61; and 5.The fire protection system’s piping is looped within the structure and is connected to one or more routinely used fixtures (such as a water closet) to prevent stagnant water. B.The District highly encourages the use of a passive purge system, as described in section 38.05, for all new single-family residential sites. 38.06 FIRE FLOW TESTS A.The District’s calibrated hydraulic model is used to provide fire flow pressure data when Formatted: Indent: Hanging: 0.5" 38-5 requested by customers. Each request for fire flow letter shall be charged a Fire Flow Fee, as set forth in Appendix A, 38.06 A. This fee is non-refundable. Fire flow analysis requiring new infrastructure to be added to the model will be charged at actual costs incurred. No fee will be charged for a fire flow requested by another public agency. 38-1 SECTION 38 SERVICE FOR FIRE PROTECTION SYSTEMS 38.01 SERVICE FOR COMMERCIAL OR INDUSTRIAL PURPOSES The District will provide water service for fire pro- tection systems for commercial or industrial developments within the District. Such service shall be available only in accordance with the rules and regulations provided in this Code. 38.02 RULES AND REGULATIONS FOR FIRE HYDRANT AND/OR FIRE SPRINKLER SERVICE FOR COMMERCIAL OR INDUSTRIAL PURPOSES, OR MULTI-FAMILY RESIDENCES, ON PRIVATE PROPERTY A.All fire hydrant and/or fire sprinkler service mains installed for commercial or industrial purposes, or multi-family residences, on privately-owned land shall be owned and maintained by the land owner; except for fire hydrants installed for developments where the District has accepted an easement for such service mains. B.Where service is provided for fire hydrant or fire sprinkler service on privately-owned land under Paragraph A above, the service shall be provided by the District at the property line of the land to be served. The property owner or developer shall be responsible to construct and maintain the remainder of the facilities to pro- vide fire protection to the property. Each such facilities installation shall include a reduced pressure principle detector backflow prevention assembly (RPDA) device installed in accordance with District specifications, and tested annually in accordance with Section 23.04.G. of this code. The RPDA device shall be installed on the fire main located on the customer side of the property line. C.Water furnished for fire hydrant or fire sprin- kler service shall be used only for fire protec- tion purposes. Water service for domestic, business, commercial or irrigation purposes, or multi-family residences, shall be furnished only after a meter or meters have been installed on Exhibit 2 38-2 laterals connected to the District main in the street pursuant to requirements of this Code. D. Upon application for installation of one or more fire service connections to an existing District water main, the customer shall pay such charges as shall be determined on the basis of actual costs incurred by the District in performing the work. At the time of application for the installation, the District will estimate the total costs to be incurred in performing the work. The customer shall deposit the estimated amount with the District prior to commencement of the work. The work shall be performed by the District under a District Water/Sewer Order. If actual costs incurred by the District are less than the amount deposited, the District shall refund the balance of the deposit to the customer. If the costs incurred exceed the amount deposited, the customer shall reimburse the District for the additional costs. Where the fire service connection is to be made to a water main to be constructed in a street by the owner or developer, the costs for such connection shall be covered under the standard developer's agreement with the District for installation of the water facilities for the development project. E. Water for fire protection services shall be pro- vided in accordance with District fees and charges set forth in Section 25.03 D.16.(c) of this Code. F. The District shall have no responsibility for the proper function of the fire service system or for the availability of water from its mains for fire protection in the event of emergency. While the District undertakes at all times to have adequate supplies available in its system for ordinary uses, it is not a guarantor of continual service in quantities adequate for all purposes however, and each customer shall specifically agree that as a condition of the fire service connection contracted for that the District shall incur no liability or be subject to any damages resulting from a failure or 38-3 malfunctioning of the fire sprinkler lateral or fire sprinkler system or from a lack of water in adequate quantity or pressure to make it fully effective. 38.03 SERVICES FOR INDIVIDUALLY METERED RESIDENTIAL FIRE PROTECTION When a single-family residential water meter is required to provide standby capacity for a fire sprinkler system, the capacity charge may be determined according to the size of the meter necessary to meet the water use requirements for the property. Additional capacity fees for upsizing the single-family residential meter to meet fire flow requirements will be waived. Standby capacity to provide water for a fire sprinkler system is required when (1) the fire sprinkler system is required by law, including any requirement imposed as a condition of development, permit, or occupancy, and (2) the fire chief, fire marshal, or building official of the city, county, or special district responsible for fire protection service to the property has a requirement for additional meter size due to fire protection. The determination, under this section, shall be made at the time the meter is first obtained, or at the time a meter is replaced with one of greater size due to the later installation of a fire protection system. When a separate meter is required, water for fire protection services shall be provided in accordance with District fees and charges set forth in Section 25.03 D.16.(c) of this Code. 38.04 FIRE SPRINKLER SERVICE FOR COMBINED MULTI & SINGLE FAMILY SITES A. Master metered residential sites that contain both multi-family and single-family units, as designated by the fire department with jurisdiction, shall design and install the multi-family portion of the project in accordance with Section 38.02 (A through F). Portions of the site designated as single-family 38-4 shall design and install fire sprinklers as required by the fire agency with jurisdiction. The District requires all single-family residential homes to abide by the rules set forth in Section 38.05. 38.05 RULES AND REGULATIONS FOR SINGLE-FAMILY RESIDENTIAL PROPERTIES WITH FIRE PROTECTION SYSTEMS A. The District requires single-family residential homes with fire sprinklers to include an above- grade double check valve backflow prevention assembly unless all the following criteria are met: 1. The user premises has only one service connection to the PWS; 2. A single service line onto the user premises exists that subsequently splits on the property for domestic flow and fire protection system flow, such that the fire protection system may be isolated from the rest of the user premises; 3. A single, water industry standard, water meter is provided to measure combined domestic flow and fire protection system flow; 4. The fire protection system is constructed of piping materials certified as meeting NSF/ANSI Standard 61; and 5. The fire protection system’s piping is looped within the structure and is connected to one or more routinely used fixtures (such as a water closet) to prevent stagnant water. B. The District highly encourages the use of a passive purge system, as described in section 38.05, for all new single-family residential sites. 38.06 FIRE FLOW TESTS A. The District’s calibrated hydraulic model is used to provide fire flow pressure data when 38-5 requested by customers. Each request for fire flow letter shall be charged a Fire Flow Fee, as set forth in Appendix A, 38.06 A. This fee is non-refundable. Fire flow analysis requiring new infrastructure to be added to the model will be charged at actual costs incurred. No fee will be charged for a fire flow requested by another public agency. Section #Code #Fee Description Meter Size 9 9.04 A.1.District Annexation Processing Fee $1,068.96 9.04 B. Annexation Fees for Water Annexations into Otay Water District Boundaries Districtwide Annexation Fee 3/4"$2,797.94 1"$6,994.85 1-1/2"$13,989.70 2"$22,383.52 3"$44,767.04 4"$69,948.50 6"$139,897.00 8"$223,835.20 10"$321,763.10 9.04 C.4. Annexation Fees for Annexations to Sewer Improvement Districts per EDU $1,530.59 10 10.01 Waiver Request $50.00 23 23.04 Backflow Certification - Second Notification $10.00 - Third Notification $25.00 - Third Notification (hand delivered)$60.00 - Reconnection $60.00 - Reconnection (if test performed with technician present)$180.00 $25.00 - Renewal Filing Fee (to remain on list of approved backflow prevention device testers)Annually $10.00 25 25.03 A. Set-up Fees for Accounts $15.00 25 25.03 B. Monthly MWD & CWA Fixed System Charges (1)3/4"$23.89 1"$39.82 1-1/2"$79.60 2"$127.34 3"$278.58 4"$501.45 6"$1,114.34 8"$1,910.26 10"$3,024.59 (1)Water billed beginning January 1, 2026, which may include water used December 2025. Charges - Initial Filing Fee (New applicants for addition to the list of approved backflow prevention device testers) Appendix A Otay Water District Exhibit 3 Section #Code #Fee Description Meter Size Charges 25 25.03 C.1. Domestic Residential Monthly Fixed System Charges (1)3/4" $22.88 1" $28.45 1-1/2" $42.70 2" $59.55 25 25.03 C.2. Multi-Residential Monthly Fixed System Charges (1)3/4" $21.11 1" $25.50 1-1/2" $36.79 2" $50.11 3" $105.83 4" $178.32 6" $349.92 8" $540.25 10" $828.43 25 25.03 C.3. Business and Commercial Monthly Fixed System Charges (1)3/4" $23.08 1" $28.77 1-1/2" $43.33 2" $60.54 3" $128.65 4" $219.41 6" $441.22 8" $696.80 10" $1,076.28 25 25.03 C.4.3/4" $20.42 1" $24.35 1-1/2" $34.52 2" $46.46 3" $97.82 4" $163.93 6" $317.90 8" $485.42 10"$741.58 25 25.03 C.5.3/4" $21.48 1" $26.13 1-1/2" $38.05 2" $52.15 3" $110.25 4" $186.28 6" $367.61 8" $570.63 10"$876.51 Publicly Owned Monthly Fixed System Charges (1) Non-Public Irrigation and Commercial Agriculture Monthly Fixed System Charges (1) (1) Water billed beginning January 1, 2026, which may include water used December 2025. Section #Code #Fee Description Meter Size Charges 25 25.03 C.6.Public Irrigation Monthly Fixed System Charges (1)3/4" $20.42 1" $24.35 1-1/2" $34.52 2" $46.46 3" $97.82 4" $163.93 25 25.03 C.7.3/4" $20.99 1" $25.29 1-1/2" $36.39 2" $49.48 3" $104.46 4" $175.87 6" $344.47 8" $530.95 10"$813.67 25 25.03 C.8.3/4" $42.75 1" $57.89 1-1/2" $96.30 2" $141.96 3" $311.13 4" $543.00 6" $1,130.33 8" $1,745.28 10" $2,859.05 25 25.03 D.1.(b) Domestic Residential Water Rates (1)Unit Charge 0-9 $6.66 10-12 $7.23 13 or more $8.03 25 25.03 D.2.(b) Multi-Residential Water Rates - Per Dwelling Unit (1)0-9 $6.61 10-12 $7.15 13 or more $7.41 25 25.03 D.3.(b) Business and Commercial Water Rates (1)All Units $7.00 25 25.03 D.4.(c) Non-Public Irrigation and Commercial Agriculture Using Potable Water Rates (1)All Units $8.06 25 25.03 D.5.(b) Publicly-Owned Water Rates (1)All Units $7.70 25 25.03 D.6.(b) Public Irrigation Water Rates (1)All Units $8.79 25 25.03 D.7.(b) Construction Water Rates (1)All Units $8.00 Construction Monthly Fixed System Charges (1) Recycled Monthly Fixed System Charges (1) (1) Water billed beginning January 1, 2026, which may include water used December 2025. Section #Code #Fee Description Meter Size Charges 25 25.03 D.8.(c)Recycled Non-Public Irrigation Water Rates (1)All Units $6.36 25 25.03 D.9.(c)Recycled Commercial Water Rates (1)All Units $5.84 25 25.03 D.10.(c)Recycled Public Irrigation Water Rates (1)All Units $6.48 25 25.03 D.11.(b) Potable Interim Business and Commercial Water Rates (1)All Units $14.00 25 25.03 D.12.(b) Potable Interim Non-Public Irrigation and Commercial Agriculture Water Rates (1)All Units $16.12 25 25.03 D.13.(b) Tank Trucks Water Rates (1)All Units $8.00 25 25.03 D.14.(c) Application Fee for Water Service Outside District Boundaries $500.00 25 25.03 D.14.(d) Water Rate for Service Outside District Boundaries (1)All Units $15.40 25 25.03 D.15.(b) Application Fee for Water Service Outside an Improvement District $275.00 25 25.03 D.15.(c) Water Rate for Service Outside Improvement District (1)All Units $15.40 25 25.03 D.16.(c) Fire Service Monthly Charge 3/4"$3.30 1"$3.38 1-1/2"$3.72 2"$4.27 3"$6.32 4"$9.81 6"$22.40 8"$44.10 10"$76.73 25 25.03 E.1.Energy Charges for Pumping Potable Water (1) Per 100 ft of lift over 450 ft per unit $0.092 25 25.03 E.2. Energy Charges for Pumping Recycled Water (1) Per 100 ft of lift over 450 ft per unit $0.099 (1) Water billed beginning January 1, 2026, which may include water used December 2025. Section #Code #Fee Description Meter Size Charges 25 25.04 A.Deposits for Non-Property Owners 3/4"$150.00 1"$250.00 1-1/2"$300.00 2"$450.00 3"$1,000.00 4"$1,350.00 6"$3,300.00 8"$7,000.00 10"$10,000.00 28 28.01 B.1.Capacity Fees and Zone Charge Districtwide Capacity Fee - All IDs excluding Triad 3/4" $14,745.27 1" $36,863.18 1-1/2" $73,726.35 2" $117,962.16 3" $235,924.32 4" $368,631.75 6" $737,263.50 8" $1,179,621.60 10" $1,695,706.05 - TRIAD 3/4" $11,058.95 1" $27,647.38 1 -1/2" $55,294.75 2" $88,471.60 3" $176,943.20 4" $276,473.75 6" $552,947.50 8" $884,716.00 10" $1,271,779.25 28 28.02 Installation and Water Meter Charges Meter Size Meter Cost Installation Total Meter Box/Vault (if Needed) - Potable (Non-Irrigation)3/4" x 7.5"$314.14 $149.08 $463.22 $126.56 3/4" x 9"$334.47 $149.08 $483.55 $126.56 1"$405.38 $149.08 $554.46 $126.56 1.5"$658.90 $149.08 $807.98 $286.91 2"$944.14 $149.08 $1,093.22 $286.91 3"$2,942.30 $897.57 $3,839.87 $5,117.99 4"$5,110.31 $897.57 $6,007.88 $5,117.99 6"$8,826.89 $1,417.78 $10,244.67 $5,117.99 8"$11,028.55 $2,174.03 $13,202.58 $7,342.12 10"$15,861.11 $2,174.03 $18,035.14 $7,342.12 Section #Code #Fee Description Meter Size Charges 28 28.02 Meter Cost Installation Total Meter Box/Vault (if Needed) - Potable/Recycled Irrigation 3/4" x 7.5"$314.14 $149.08 $463.22 $322.54 3/4" x 9"$334.47 $149.08 $483.55 $322.54 1"$405.38 $149.08 $554.46 $322.54 1.5"$658.90 $149.08 $807.98 $322.54 2"$944.14 $149.08 $1,093.22 $322.54 3"$2,036.37 $897.57 $2,933.94 $5,117.99 4"$3,964.50 $897.57 $4,862.07 $5,117.99 6"$7,137.39 $1,417.78 $8,555.17 $5,117.99 8"$9,508.28 $2,174.03 $11,682.31 $7,342.12 10"$13,492.97 $2,174.03 $15,667.00 $7,342.12 - Combined Fire and Domestic 4"$12,157.88 $897.57 $13,055.45 $5,117.99 6"$16,181.08 $1,417.78 $17,598.86 $5,117.99 8"$23,526.12 $2,174.03 $25,700.15 $7,342.12 10"$32,105.39 $2,174.03 $34,279.42 $7,342.12 31 31.03 A.1.Requirement of Deposit for Temporary Meters 3/4"$156.85 1"$184.78 1-1/2"$379.62 2"$2,865.00 4"$1,986.00 6"$2,465.00 - Construction Trailer Temporary Meter 2"$2,685.00 - Tank Truck Temporary Meter (Ordinance No. 372)2"$1,000.00 31 31.03 A.4.Temporary Meter Install & Removal 3/4" - 4" (on hydrant)$240.00 4" - 6"$960.00 8" - 10"Actual Cost 31 31.03 A.5. Temporary Meter Move Fee (includes backflow certification)3/4" - 4"(on hydrant)$180.00 4" - 6" $960.00 8" - 10"Actual Cost 33 33.07 A.Customer Request for Meter Test (Deposit)5/8", 3/4" & 1"$120.00 1-1/2" & 2 "$200.00 3" & Larger $400.00 34 34.01 D.2. Returned Check Charges $25.00 34 34.02 C Meter Lock Charge $60.00 38 38.06 A Fire Flow Fee $600.00 Installation and Water Meter Charges (continued) Section #Code #Fee Description Meter Size Charges 53 53.03 A.1.Sewer Capacity Fee within an ID $7,788.97 53 53.03 A.2.Sewer Capacity Fee per EDU outside an ID $10,774.03 53 53.03 B.1.Sewer Connection Fee - Russell Square $7,500.00 53 53.03 B.2.Monthly Sewer Service Charge - Russell Square $200.00 53 53.10 & 11 Set-up Fees for Accounts $15.00 Effective 1/1/26 Effective 1/1/27 Effective 1/1/28 Effective 1/1/29 Effective 1/1/30 53 53.10 Residential Sewer Rates (2) Rate multiplied by 3-year winter average units $3.92 $4.12 $4.53 $4.97 $5.46 53 53.10 Residential Monthly Fixed Sewer System Charges (2).75"$21.60 $22.72 $24.95 $27.40 $30.08 1"$33.32 $35.05 $38.49 $42.26 $46.40 53 53.10 A.4.Residential Sewer Without Consumption History .75"$51.04 $53.66 $58.97 $64.72 $71.08 53 53.10 B.2.Multi-Residential Sewer Rates (2) Rate multiplied by 3-year winter average units $3.92 $4.12 $4.53 $4.97 $5.46 53 53.10 B.2. Multi-Residential Monthly Fixed Sewer System Charges (2).75"$21.60 $22.72 $24.95 $27.40 $30.08 1"$33.32 $35.05 $38.49 $42.26 $46.40 1.5"$62.60 $65.86 $72.31 $79.40 $87.18 2"$97.74 $102.82 $112.90 $123.96 $136.11 3"$209.02 $219.89 $241.44 $265.10 $291.08 4"$373.02 $392.42 $430.87 $473.10 $519.46 6"$823.99 $866.84 $951.79 $1,045.06 $1,147.48 8" $1,409.68 $1,482.98 $1,628.32 $1,787.89 $1,963.10 10"$2,229.65 $2,345.59 $2,575.46 $2,827.85 $3,104.98(2) Sewer billed beginning January 1, 2026. Section #Code #Fee Description Meter Size Charges Effective 1/1/26 Effective 1/1/27 Effective 1/1/28 Effective 1/1/29 Effective 1/1/30 53 53.11 Commercial and Industrial Sewer Rates Rate multiplied by Low Strength $3.35 $3.52 $3.87 $4.25 $4.67 annual avg.Medium Strength $4.73 $4.98 $5.46 $6.00 $6.59 units High Strength $7.46 $7.85 $8.62 $9.46 $10.39 53 53.11 Commercial and Industrial Monthly Fixed Sewer System Charges (2).75"$21.60 $22.72 $24.95 $27.40 $30.08 1"$33.32 $35.05 $38.49 $42.26 $46.40 1.5"$62.60 $65.86 $72.31 $79.40 $87.18 2"$97.74 $102.82 $112.90 $123.96 $136.11 3"$209.02 $219.89 $241.44 $265.10 $291.08 4"$373.02 $392.42 $430.87 $473.10 $519.46 6"$823.99 $866.84 $951.79 $1,045.06 $1,147.48 8" $1,409.68 $1,482.98 $1,628.32 $1,787.89 $1,963.10 10"$2,229.65 $2,345.59 $2,575.46 $2,827.85 $3,104.98 60 60.03 Issuance of Availability Letters for Water and/or Sewer Service $75.00 72 72.04 A.1. Locking or Removing Damaged or Tampered Meters - To Pull and Reset Meter 3/4" - 2"$250.00 - Broken Curbstop or Tabs 3/4" - 1"Actual Cost - If Customer uses Jumper 3/4" - 1"Actual Cost - Broken Lock/Locking Device 3/4" - 1"$80.00 - Broken Curbstop or Tabs 1.5" - 2"Actual Cost - To Pull and Reset Meter 3"Actual Cost - To Pull and Reset Meter 4"Actual Cost - To Pull and Reset Meter 6"Actual Cost - To Pull and Reset Meter 8"Actual Cost - To Pull and Reset Meter 10"Actual Cost 72 72.05 D. Type I Fine - First Violation $100.00 - Second Violations $200.00 - Third or each additional violation of that same ordinance or requirement within a twelve-month period $500.00 (2) Sewer billed beginning January 1, 2026. Section #Code #Fee Description Meter Size Charges 72 72.05 D. Type II Fine $5,000.00 Type III Fine $500.00 Type IV Fine $500.00 State Water Code #71630 & Annual Board Resolution #4142 Water Availability/Standby Annual Special Assessment Charge $10.00 $30.00 $3.00 $3.00 State Water Code #71630 & Annual Board Resolution #4142 Sewer Availability/Standby Annual Special Assessment Charge $10.00 $30.00 Annual Board Resolution General Obligation Bond Annual Tax Assessment $0.005 Policies 5B Copies of Identifiable Public Records $0.20/page 54 Late Payment Charge 54 Lien Processing Fee $55.00 54 Delinquent Tax Roll Fee $45.00 54 Delinquency Mailed Notice $5.00 54 Delinquency Tag $25.00 Per acre for outside I.D. & greater than one mile from District facilities. Less than one acre I.D. 18 Less than one-acre all I.D.s & Outside an I.D. Fine up to amount specified per each day the violation is identified or continues. Will not exceed per each day the violation is identified or continues. 5% of Delinquent Balance Less than one-acre Outside I.D. and greater than one mile from District facilities. Per acre in I.D. 22 Fine up to amount specified per each day the violation is identified or continues. The cost for all other copy sizes is the direct cost of duplication. Per acre I.D. 18 8 1/2" x 11" Per $1000 of assessed value for I.D. 27 Section #Code #Fee Description Meter Size 9 9.04 A.1.District Annexation Processing Fee $1,068.96 9.04 B. Annexation Fees for Water Annexations into Otay Water District Boundaries Districtwide Annexation Fee 3/4"$2,797.94 1"$6,994.85 1-1/2"$13,989.70 2"$22,383.52 3"$44,767.04 4"$69,948.50 6"$139,897.00 8"$223,835.20 10"$321,763.10 9.04 C.4. Annexation Fees for Annexations to Sewer Improvement Districts per EDU $1,530.59 10 10.01 Waiver Request $50.00 23 23.04 Backflow Certification - Third Notification $60.00 - Third Notification (hand delivered)$110.00 - Reconnection $230.00 $40.00 25 25.03 A. Set-up Fees for Accounts $15.00 25 25.03 B. Monthly MWD & CWA Fixed System Charges (1)3/4"$23.89 1"$39.82 1-1/2"$79.60 2"$127.34 3"$278.58 4"$501.45 6"$1,114.34 8"$1,910.26 10"$3,024.59 (1)Water billed beginning January 1, 2026, which may include water used December 2025. Charges - Initial Filing Fee (New applicants for addition to the list of approved backflow prevention device testers) Appendix A Otay Water District Exhibit 4 Section #Code #Fee Description Meter Size Charges 25 25.03 C.1. Domestic Residential Monthly Fixed System Charges (1)3/4" $22.88 1" $28.45 1-1/2" $42.70 2" $59.55 25 25.03 C.2. Multi-Residential Monthly Fixed System Charges (1)3/4" $21.11 1" $25.50 1-1/2" $36.79 2" $50.11 3" $105.83 4" $178.32 6" $349.92 8" $540.25 10" $828.43 25 25.03 C.3. Business and Commercial Monthly Fixed System Charges (1)3/4" $23.08 1" $28.77 1-1/2" $43.33 2" $60.54 3" $128.65 4" $219.41 6" $441.22 8" $696.80 10" $1,076.28 25 25.03 C.4.3/4" $20.42 1" $24.35 1-1/2" $34.52 2" $46.46 3" $97.82 4" $163.93 6" $317.90 8" $485.42 10"$741.58 25 25.03 C.5.3/4" $21.48 1" $26.13 1-1/2" $38.05 2" $52.15 3" $110.25 4" $186.28 6" $367.61 8" $570.63 10"$876.51 (1) Water billed beginning January 1, 2026, which may include water used December 2025. Publicly Owned Monthly Fixed System Charges (1) Non-Public Irrigation and Commercial Agriculture Monthly Fixed System Charges (1) Section #Code #Fee Description Meter Size Charges 25 25.03 C.6.Public Irrigation Monthly Fixed System Charges (1)3/4" $20.42 1" $24.35 1-1/2" $34.52 2" $46.46 3" $97.82 4" $163.93 25 25.03 C.7.3/4" $20.99 1" $25.29 1-1/2" $36.39 2" $49.48 3" $104.46 4" $175.87 6" $344.47 8" $530.95 10"$813.67 25 25.03 C.8.3/4" $42.75 1" $57.89 1-1/2" $96.30 2" $141.96 3" $311.13 4" $543.00 6" $1,130.33 8" $1,745.28 10" $2,859.05 25 25.03 D.1.(b) Domestic Residential Water Rates (1)Unit Charge 0-9 $6.66 10-12 $7.23 13 or more $8.03 25 25.03 D.2.(b) Multi-Residential Water Rates - Per Dwelling Unit (1)0-9 $6.61 10-12 $7.15 13 or more $7.41 25 25.03 D.3.(b) Business and Commercial Water Rates (1)All Units $7.00 25 25.03 D.4.(c) Non-Public Irrigation and Commercial Agriculture Using Potable Water Rates (1)All Units $8.06 25 25.03 D.5.(b) Publicly-Owned Water Rates (1)All Units $7.70 25 25.03 D.6.(b) Public Irrigation Water Rates (1)All Units $8.79 25 25.03 D.7.(b) Construction Water Rates (1)All Units $8.00 (1) Water billed beginning January 1, 2026, which may include water used December 2025. Construction Monthly Fixed System Charges (1) Recycled Monthly Fixed System Charges (1) Section #Code #Fee Description Meter Size Charges 25 25.03 D.8.(c)Recycled Non-Public Irrigation Water Rates (1)All Units $6.36 25 25.03 D.9.(c)Recycled Commercial Water Rates (1)All Units $5.84 25 25.03 D.10.(c)Recycled Public Irrigation Water Rates (1)All Units $6.48 25 25.03 D.11.(b) Potable Interim Business and Commercial Water Rates (1)All Units $14.00 25 25.03 D.12.(b) Potable Interim Non-Public Irrigation and Commercial Agriculture Water Rates (1)All Units $16.12 25 25.03 D.13.(b) Tank Trucks Water Rates (1)All Units $8.00 25 25.03 D.14.(c) Application Fee for Water Service Outside District Boundaries $500.00 25 25.03 D.14.(d) Water Rate for Service Outside District Boundaries (1)All Units $15.40 25 25.03 D.15.(b) Application Fee for Water Service Outside an Improvement District $275.00 25 25.03 D.15.(c) Water Rate for Service Outside Improvement District (1)All Units $15.40 25 25.03 D.16.(c) Fire Service Monthly Charge 3/4"$3.30 1"$3.38 1-1/2"$3.72 2"$4.27 3"$6.32 4"$9.81 6"$22.40 8"$44.10 10"$76.73 25 25.03 E.1.Energy Charges for Pumping Potable Water (1) Per 100 ft of lift over 450 ft per unit $0.092 25 25.03 E.2. Energy Charges for Pumping Recycled Water (1) Per 100 ft of lift over 450 ft per unit $0.099 (1) Water billed beginning January 1, 2026, which may include water used December 2025. Section #Code #Fee Description Meter Size Charges 25 25.04 A.Deposits for Non-Property Owners 3/4"$150.00 1"$250.00 1-1/2"$300.00 2"$450.00 3"$1,000.00 4"$1,350.00 6"$3,300.00 8"$7,000.00 10"$10,000.00 28 28.01 B.1.Capacity Fees and Zone Charge Districtwide Capacity Fee - All IDs excluding Triad 3/4" $14,745.27 1" $36,863.18 1-1/2" $73,726.35 2" $117,962.16 3" $235,924.32 4" $368,631.75 6" $737,263.50 8" $1,179,621.60 10" $1,695,706.05 - TRIAD 3/4" $11,058.95 1" $27,647.38 1 -1/2" $55,294.75 2" $88,471.60 3" $176,943.20 4" $276,473.75 6" $552,947.50 8" $884,716.00 10" $1,271,779.25 28 28.02 Installation and Water Meter Charges Meter Size Meter Cost Installation Total Meter Box/Vault (if Needed) - Potable (Non-Irrigation)3/4" x 7.5"$314.14 $149.08 $463.22 $126.56 3/4" x 9"$334.47 $149.08 $483.55 $126.56 1"$405.38 $149.08 $554.46 $126.56 1.5"$658.90 $149.08 $807.98 $286.91 2"$944.14 $149.08 $1,093.22 $286.91 3"$2,942.30 $897.57 $3,839.87 $5,117.99 4"$5,110.31 $897.57 $6,007.88 $5,117.99 6"$8,826.89 $1,417.78 $10,244.67 $5,117.99 8"$11,028.55 $2,174.03 $13,202.58 $7,342.12 10"$15,861.11 $2,174.03 $18,035.14 $7,342.12 Section #Code #Fee Description Meter Size Charges 28 28.02 Meter Cost Installation Total Meter Box/Vault (if Needed) - Potable/Recycled Irrigation 3/4" x 7.5"$314.14 $149.08 $463.22 $322.54 3/4" x 9"$334.47 $149.08 $483.55 $322.54 1"$405.38 $149.08 $554.46 $322.54 1.5"$658.90 $149.08 $807.98 $322.54 2"$944.14 $149.08 $1,093.22 $322.54 3"$2,036.37 $897.57 $2,933.94 $5,117.99 4"$3,964.50 $897.57 $4,862.07 $5,117.99 6"$7,137.39 $1,417.78 $8,555.17 $5,117.99 8"$9,508.28 $2,174.03 $11,682.31 $7,342.12 10"$13,492.97 $2,174.03 $15,667.00 $7,342.12 - Combined Fire and Domestic 4"$12,157.88 $897.57 $13,055.45 $5,117.99 6"$16,181.08 $1,417.78 $17,598.86 $5,117.99 8"$23,526.12 $2,174.03 $25,700.15 $7,342.12 10"$32,105.39 $2,174.03 $34,279.42 $7,342.12 31 31.03 A.1.Requirement of Deposit for Temporary Meters 3/4"$156.85 1"$184.78 1-1/2"$379.62 2"$2,865.00 4"$1,986.00 6"$2,465.00 - Construction Trailer Temporary Meter 2"$2,685.00 - Tank Truck Temporary Meter (Ordinance No. 372)2"$1,000.00 31 31.03 A.4.Temporary Meter Install & Removal 3/4" - 4" (on hydrant)$280.00 4" - 6"$1,200.00 8" - 10"Actual Cost 31 31.03 A.5. Temporary Meter Move Fee (includes backflow certification)3/4" - 4"(on hydrant)$210.00 4" - 6" $1,200.00 8" - 10"Actual Cost 33 33.07 A.Customer Request for Meter Test (Deposit)5/8", 3/4" & 1"$120.00 1-1/2" & 2 "$200.00 3" & Larger $400.00 34 34.01 D.2. Returned Check Charges $25.00 34 34.02 C Meter Lock Charge $70.00 38 38.06 A Fire Flow Fee $600.00 Installation and Water Meter Charges (continued) Section #Code #Fee Description Meter Size Charges 53 53.03 A.1.Sewer Capacity Fee within an ID $7,985.23 53 53.03 A.2.Sewer Capacity Fee per EDU outside an ID $11,045.51 53 53.03 B.1.Sewer Connection Fee - Russell Square $7,500.00 53 53.03 B.2.Monthly Sewer Service Charge - Russell Square $200.00 53 53.10 & 11 Set-up Fees for Accounts $15.00 Effective 1/1/26 Effective 1/1/27 Effective 1/1/28 Effective 1/1/29 Effective 1/1/30 53 53.10 Residential Sewer Rates (2) Rate multiplied by 3-year winter average units $3.92 $4.12 $4.53 $4.97 $5.46 53 53.10 Residential Monthly Fixed Sewer System Charges (2).75"$21.60 $22.72 $24.95 $27.40 $30.08 1"$33.32 $35.05 $38.49 $42.26 $46.40 53 53.10 A.4.Residential Sewer Without Consumption History .75"$51.04 $53.66 $58.97 $64.72 $71.08 53 53.10 B.2.Multi-Residential Sewer Rates (2) Rate multiplied by 3-year winter average units $3.92 $4.12 $4.53 $4.97 $5.46 53 53.10 B.2. Multi-Residential Monthly Fixed Sewer System Charges (2).75"$21.60 $22.72 $24.95 $27.40 $30.08 1"$33.32 $35.05 $38.49 $42.26 $46.40 1.5"$62.60 $65.86 $72.31 $79.40 $87.18 2"$97.74 $102.82 $112.90 $123.96 $136.11 3"$209.02 $219.89 $241.44 $265.10 $291.08 4"$373.02 $392.42 $430.87 $473.10 $519.46 6"$823.99 $866.84 $951.79 $1,045.06 $1,147.48 8" $1,409.68 $1,482.98 $1,628.32 $1,787.89 $1,963.10 10"$2,229.65 $2,345.59 $2,575.46 $2,827.85 $3,104.98 (2) Sewer billed beginning January 1, 2026. Section #Code #Fee Description Meter Size Charges Effective 1/1/26 Effective 1/1/27 Effective 1/1/28 Effective 1/1/29 Effective 1/1/30 53 53.11 Commercial and Industrial Sewer Rates Rate multiplied by Low Strength $3.35 $3.52 $3.87 $4.25 $4.67 annual avg.Medium Strength $4.73 $4.98 $5.46 $6.00 $6.59 units High Strength $7.46 $7.85 $8.62 $9.46 $10.39 53 53.11 Commercial and Industrial Monthly Fixed Sewer System Charges (2).75"$21.60 $22.72 $24.95 $27.40 $30.08 1"$33.32 $35.05 $38.49 $42.26 $46.40 1.5"$62.60 $65.86 $72.31 $79.40 $87.18 2"$97.74 $102.82 $112.90 $123.96 $136.11 3"$209.02 $219.89 $241.44 $265.10 $291.08 4"$373.02 $392.42 $430.87 $473.10 $519.46 6"$823.99 $866.84 $951.79 $1,045.06 $1,147.48 8" $1,409.68 $1,482.98 $1,628.32 $1,787.89 $1,963.10 10"$2,229.65 $2,345.59 $2,575.46 $2,827.85 $3,104.98 60 60.03 Issuance of Availability Letters for Water and/or Sewer Service $75.00 72 72.04 A.1. Locking or Removing Damaged or Tampered Meters - To Pull and Reset Meter 3/4" - 2"$310.00 - Broken Curbstop or Tabs 3/4" - 1"Actual Cost - If Customer uses Jumper 3/4" - 1"Actual Cost - Broken Lock/Locking Device 3/4" - 1"$95.00 - Broken Curbstop or Tabs 1.5" - 2"Actual Cost - To Pull and Reset Meter 3"Actual Cost - To Pull and Reset Meter 4"Actual Cost - To Pull and Reset Meter 6"Actual Cost - To Pull and Reset Meter 8"Actual Cost - To Pull and Reset Meter 10"Actual Cost 72 72.05 D. Type I Fine - First Violation $100.00 - Second Violations $200.00 - Third or each additional violation of that same ordinance or requirement within a twelve-month period $500.00 (2) Sewer billed beginning January 1, 2026. Section #Code #Fee Description Meter Size Charges 72 72.05 D. Type II Fine $5,000.00 Type III Fine $500.00 Type IV Fine $500.00 State Water Code #71630 & Annual Board Resolution #4142 Water Availability/Standby Annual Special Assessment Charge $10.00 $30.00 $3.00 $3.00 State Water Code #71630 & Annual Board Resolution #4142 Sewer Availability/Standby Annual Special Assessment Charge $10.00 $30.00 Annual Board Resolution General Obligation Bond Annual Tax Assessment $0.005 Policies 5B Copies of Identifiable Public Records $0.20/page 54 Late Payment Charge 54 Lien Processing Fee $60.00 54 Delinquent Tax Roll Fee $50.00 54 Delinquency Mailed Notice $5.00 54 Delinquency Tag $25.00 5% of Delinquent Balance Less than one-acre Outside I.D. and greater than one mile from District facilities. Per acre in I.D. 22 Fine up to amount specified per each day the violation is identified or continues. The cost for all other copy sizes is the direct cost of duplication. Per acre I.D. 18 8 1/2" x 11" Per $1000 of assessed value for I.D. 27 Per acre for outside I.D. & greater than one mile from District facilities. Less than one acre I.D. 18 Less than one-acre all I.D.s & Outside an I.D. Fine up to amount specified per each day the violation is identified or continues. Will not exceed per each day the violation is identified or continues. STAFF REPORT TYPE MEETING: Regular Board MEETING DATE: November 5, 2025 SUBMITTED BY: Marissa Dychitan Senior Accountant PROJECT: DIV. NO. All APPROVED BY: Jon Ravaglioli, Finance Manager Kevin Koeppen, Assistant Chief of Finance Joseph R. Beachem, Chief Financial Officer Jose Martinez, General Manager SUBJECT: Approve the Audited Financial Statements for the Fiscal Year Ended June 30, 2025 GENERAL MANAGER'S RECOMMENDATION: That the Board approve the Audited Financial Statements (Attachment B), including the Independent Auditors' unqualified opinion, for the fiscal year ending June 30, 2025. COMMITTEE ACTION: See Attachment A. PURPOSE: To inform the Board of the significant financial events which occurred during the fiscal year ended June 30, 2025, as reflected in the audited financial statements. ANALYSIS: Davis Farr LLP performed the audit and found that, in all material respects, the financial statements correctly represent the District's AGENDA ITEM 8a 2 financial position. They found no material errors in the financial records or statements (Attachment D). Total Assets: Total assets increased by $10.0 million, or 1.60%, during Fiscal Year 2025, to $634.8 million, due to increases in capital assets, prepaid assets, and receivables, partially offset by decreases in cash and cash equivalents and investments. Deferred Outflows & Deferred Inflows: Deferred outflows decreased by $9.0 million, or 35.41%, in Fiscal Year 2025 due to decreases in pension and OPEB actuarial costs. Deferred inflows increased by $5.4 million, or 12.27%, due to increases in deferred investment income for the OPEB and pension plans and deferred inflows from leases. Total Liabilities & Net Positions: Total liabilities decreased by $30.5 million, or 15.12%, from the previous fiscal year to $171.2 million. The decrease is attributable to the decreases in net pension and OPEB liabilities, other liabilities and debt service payments. The net position increased by $26.0 million, or 6.43%, to $430.3 million as of June 30, 2025. Capital Contributions: Capital contributions for Fiscal Year 2025 totaled $14.2 million. Capital contributions consist of developers contributing $4.0 million in capacity fees and $9.7 million in contributed fixed assets. Ratepayers also paid $0.5 million in availability fees, which are collected on the tax roll and considered a part of capital contributions. Results of Operations: Operating revenues increased by $16.3 million, or 14.49%, due to increases in water sales volume due to dryer weather and water rates. The cost of water sales increased by $11.8 million, or 15.15%, due to increased unit purchase costs and volumes purchased. 3 Non-Operating Revenues & Expenses: Non-operating revenues increased by $15.2 million, or 89.94%, for Fiscal Year 2025 due primarily to an increase in tax revenues and miscellaneous revenues partially offset by the decrease in investment income. Non-operating expenses decreased by $27.7 million, or 85.29%, in Fiscal Year 2025 due primarily to the decrease in miscellaneous expenses. Conclusion: In summary, the overall audit process was successful, and the auditors found no material errors or misstatements in the District's financial statements. Additional Audit Correspondence: As a part of completing the audit engagement, Davis Farr LLP also provided the following letters summarizing their observations and conclusions concerning the District's overall financial processes: • Management Letter: The auditors did not identify any internal control deficiencies that they considered material weaknesses. (Attachment C). • Audit Committee Letter: This letter describes the overall aspects of the audit, including audit principles, performance, dealings with management, and significant findings or issues. There were no disagreements with management concerning financial accounting, reporting, or auditing matters, and there were no significant difficulties in dealing with management in performing the audit. (Attachment D). • Report on Applying Agreed-Upon Procedures: A review of the District's investment portfolio at year-end and a sample of specific investment transactions completed throughout the fiscal year were performed. There were no exceptions to compliance from the District's Investment Policy. (Attachment E). FISCAL IMPACT: None. 4 STRATEGIC GOAL: The District ensures its continued financial health through long-term financial planning, formalized financial policies, enhanced budget controls, fair pricing, debt planning, and improved financial reporting. LEGAL IMPACT: None. Attachments: A) Committee Action B) Audited Annual Financial Statements C) Management Letter D) Audit Committee Letter E) Report on Applying Agreed-Upon Procedures ATTACHMENT A SUBJECT/PROJECT: Approve the Audited Financial Statements for the Fiscal Year Ended June 30, 2025 COMMITTEE ACTION: The Finance & Administration Committee (Committee) reviewed this item at a meeting held on October 22, 2025, and the following comments were made: • Staff recommended accepting the independent auditor’s report ending June 30, 2025; the auditors found the financial statements correctly represent the district’s financial position. The auditors indicated they would be issuing an unmodified opinion, which is the highest level of opinion that can be received on the financial statements. • A new accounting standard referred to as GASB 101 was implemented; auditors reviewed calculations for compensated absences and a new health reimbursement arrangement (HRA) elections. • In response to a question by the Committee, the auditors stated that applicable accounting standards had already been provided and noted that their firm issues an annual accounting update for Finance staff. It was further stated that an interim phase is conducted in May, during which upcoming changes to the financial statements are discussed. • The auditors indicated that expanded testing on capital assets was performed to verify they were still held and properly recorded. • The auditors stated that upcoming guidance, known as GASB 103, could change revenue recognition where certain items may be reclassified as “other items,” potentially affecting the classification of revenues in the district’s audited financial statements. • In response to the Committee’s inquiry on the effect of GASB 103, the auditors noted that while there was no clear definition, some examples were investment income, interest income, grants, and subsidies not tied to operations. Following the discussion, the Committee supported staff’s recommendation and presentation to the full board as an action item. OTAY WATER DISTRICT FINANCIAL STATEMENTS WITH REPORT ON AUDIT BY INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS YEAR ENDED JUNE 30, 2025 Attachment B Table of Contents Year Ended June 30, 2025 Page Number Independent Auditor’s Report 1 Management’s Discussion & Analysis 4 Basic Financial Statements: Statement of Net Position 14 Statement of Revenues, Expenses, and Changes in Net Position 16 Statement of Cash Flows 17 Notes to Financial Statements 19 Required Supplementary Information: Schedule of Changes in the Net OPEB Liability and Related Ratios 65 Schedule of Contributions 66 Schedule of Changes in the Net Pension Liability and Related Ratios 67 Schedule of Plan Contributions 68 Independent Auditor’s Report Board of Directors Otay Water District Spring Valley, California Report on the Audit of the Financial Statements Opinion We have audited the financial statements of the Otay Water District (District), as of and for the year ended June 30, 2025 and the related notes to the financial statements, which collectively comprise the District’s basic financial statements as listed in the table of contents. In our opinion, the accompanying financial statements present fairly, in all material respects, the respective financial position of the District as of June 30, 2025, and the respective changes in financial position and cash flows thereof for the year then ended in accordance with accounting principles generally accepted in the United States of America. Basis for Opinion We conducted our audit in accordance with auditing standards generally accepted in the United States of America (GAAS) and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Our responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit of the Financial Statements section of our report. We are required to be independent of the District and to meet our other ethical responsibilities, in accordance with the relevant ethical requirements relating to our audit. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion. Emphasis of Matter As described further in note 1 to the financial statements, during the year ended June 30, 2025, the District implemented Governmental Accounting Standards Board (GASB) Statement No. 101: Compensated Absences. Our opinion is not modified with respect to this matter. Responsibilities of Management for the Financial Statements The District’s management is responsible for the preparation and fair presentation of the financial statements in accordance with accounting principles generally accepted in the United States of America, and for the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, management is required to evaluate whether there are conditions or events, considered in the aggregate, that raise substantial doubt about the District’s ability to continue as a going concern for one year after the date that the financial statements are issued. Auditor’s Responsibilities for the Audit of the Financial Statements Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance but is not absolute assurance and therefore is not a guarantee that an audit conducted in accordance with GAAS will always detect a material misstatement when it exists. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. Misstatements are considered material if there is a substantial likelihood that, individually or in the aggregate, they would influence the judgment made by a reasonable user based on the financial statements. In performing an audit in accordance with GAAS, we: Exercise professional judgment and maintain professional skepticism throughout the audit. Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, and design and perform audit procedures responsive to those risks. Such procedures include examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the District’s internal control. Accordingly, no such opinion is expressed. Evaluate the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluate the overall presentation of the financial statements. Conclude whether, in our judgment, there are conditions or events, considered in the aggregate, that raise substantial doubt about the District’s ability to continue as a going concern for a reasonable period of time. We are required to communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit, significant audit findings, and certain internal control–related matters that we identified during the audit. Report on Summarized Comparative Information We have previously audited the District’s 2024 financial statements, and we expressed an unmodified audit opinion on those audited financial statements in our report dated October 25, 2024. In our opinion, the summarized comparative information presented herein as of and for the year ended June 30, 2024, is consistent, in all material respects, with the audited financial statements from which it has been derived. Required Supplementary Information Accounting principles generally accepted in the United States of America require that the Management’s Discussion and Analysis, Schedule of Changes in the Net OPEB Liability and Related Ratios, Schedule of Contributions, Schedule of Changes in the Net Pension Liability and Related Ratios, and Schedule of Plan Contributions, be presented to supplement the basic financial statements.Such information is the responsibility of management and, although not a part of the basic financial statements, is required by the Governmental Accounting Standards Board who considers it to be an essential part of financial reporting for placing the basic financial statements in an appropriate operational, economic, or historical context. We have applied certain limited procedures to the required supplementary information in accordance with auditing standards generally accepted in the United States of America, which consisted of inquiries of management about the methods of preparing the information and comparing the information for consistency with management’s responses to our inquiries, the basic financial statements, and other knowledge we obtained during our audit of the basic financial statements. We do not express an opinion or provide any assurance on the information because the limited procedures do not provide us with sufficient evidence to express an opinion or provide any assurance. Other Reporting Required by Government Auditing Standards In accordance with Government Auditing Standards, we have also issued our report dated October 29, 2025 on our consideration of the District’s internal control over financial reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements and other matters. The purpose of that report is solely to describe the scope of our testing of internal control over financial reporting and compliance and the results of that testing, and not to provide an opinion on the effectiveness of internal control over financial reporting or on compliance.That report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the District’s internal control over financial reporting and compliance. Irvine, California October 29, 2025 This page intentionally left blank Management’s Discussion and Analysis As the management of the Otay Water District (the "District"), we offer readers of the District's financial statements this narrative overview and an analysis of the District's financial performance during the fiscal year ending June 30, 2025.Please read it in conjunction with the District's financial statements that follow Management's Discussion and Analysis.All amounts, unless otherwise indicated, are expressed in millions of dollars. Overview of the Financial Statements This discussion and analysis is intended to serve as an introduction to the District's basic financial statements, which are comprised of the following: 1) Statement of Net Position, 2) Statement of Revenues, Expenses,and Changes in Net Position, 3) Statement of Cash Flows, and 4) Notes to the Financial Statements.This report also contains supplementary information in addition to the basic financial statements. The Statement of Net Position presents information on the District's assets,deferred outflows of resources, liabilities,and deferred inflows of resources, with the difference reported as Total Net Position.Over time, increases or decreases in net position may serve as a valuable indicator of whether the District's financial position is improving or weakening. The Statement of Revenues, Expenses,and Changes in Net Position presents information showing how the District's net position changed during the most recent fiscal year.All changes in net position are reported as soon as the underlying event giving rise to the change occurs, regardless of the timing of related cash flows.Thus, revenues and expenses are reported in this statement for some items that will only result in cash flows in future fiscal periods (e.g., uncollected taxes and earned but unused vacation leave). The Statement of Cash Flows presents information on cash receipts and payments for the fiscal year.The Notes to the Financial Statements provide additional information essential to a complete understanding of the data supplied in the specific financial statements listed above. Financial Highlights The assets and deferred outflows of resources of the District exceeded its liabilities and deferred inflows of resources at the close of the most recent fiscal year by $430.3 million (net position). Of this amount, $71.5 million (unrestricted net position)may be used to meet the District’s ongoing obligations to residents and creditors. Total assets increased by $10.0 million,or 1.6%,during Fiscal Year 2025 to $634.8 million, due to increases in capital and prepaid assets and receivables,which were partially offset by decreases in cash and cash equivalents and investments. Management’s Discussion and Analysis In addition to the basic financial statements and accompanying notes, this report also presents certain required supplementary information concerning the District's progress in funding its obligation to provide retirement benefits to its employees. Financial Analysis: As noted, net position may serve,over time,as a valuable indicator of an entity's financial position.In the case of the District, assets and deferred outflows of resources exceeded liabilities and deferred inflows of resources by $430.3 million at the close of Fiscal Year 2025. The most significant portion of the District's net position, $351.8 million (81.8%), reflects its investment in capital assets,less any remaining outstanding debt used to acquire those capital assets.The District uses these capital assets to provide services to customers; consequently, these assets are not available for future spending.Although the District's investment in its capital assets is reported effectively as a resource, it should be noted that the resources needed to repay the debt must be provided from other sources since the capital assets themselves cannot be used to liquidate these liabilities. Management’s Discussion and Analysis Statement of Net Position (In Millions of Dollars) 2025 2024 Assets Current and Other Assets $187.5 $187.9 Capital Assets 447.3 436.9 Total Assets 634.8 624.8 Deferred Outflows of Resources Deferred Actuarial Pension Costs 7.2 13.3 Deferred Actuarial OPEB Costs 9.3 12.2 Total Deferred Outflows of Resources 16.5 25.5 Liabilities Current Liabilities 49.8 36.4 Long-Term Debt Outstanding 89.6 95.0 Net Pension Liability 25.4 28.6 Net OPEB Liability 2.3 11.2 Other Liabilities 4.1 30.5 Total Liabilities 171.2 201.7 Deferred Inflows of Resources Deferred Inflows from Leases 46.4 43.4 Deferred Inflows Pension Costs 0.1 0.0 Deferred Actuarial OPEB Costs 3.2 0.9 Total Deferred Inflows of Resources 49.7 44.3 Net Position Net Investment in Capital Assets 351.8 336.1 Restricted for Debt Service 3.8 3.6 Restricted for Capital Assets 3.2 3.1 Unrestricted 71.5 61.5 Total Net Position $430.3 $404.3 The District's operations and population are growing.Much of this expansion has occurred in the residential sector, particularly in multi-family dwellings.The District’s commercial base is also expanding, largely due to commercial development in the Otay Mesa area of the District’s service area, which borders Mexico. By 2055, the District's service area population is expected to increase by 12% to 271,500 residents. Management’s Discussion and Analysis The District has created several future planning documents to ensure a reliable water supply and sewer system in the future, including the maintenance of current infrastructure. In FY 2025,the District's Capital Assets increased by $28.0 million before accumulated depreciation (see Note 4 in the Notes to Financial Statements).The District’s long-term debt (excluding current maturities) decreased by $5.4 million due to the annual debt service payments (see Note 5 in the Notes to Financial Statements). Total liabilities decreased by $30.5 million in FY 2025,primarily due to decreases in Net Pension and OPEB liabilities,other liabilities,and long-term debt. In FY 2025, deferred outflows of resources decreased by $9.0 million due to decreases in the actuarial pension and OPEB costs. Deferred inflows of resources increased by $5.4 million in FY 2025 due to increases in the actuarial OPEB and pension costs and deferred inflows from leases. At the end of FY 2025,the District reports positive balances in all net position categories. This situation also applied to the prior fiscal year. Management’s Discussion and Analysis Statement of Revenues, Expenses, and Changes in Net Position (In Millions of Dollars) 2025 2024 Water Sales $121.5 $105.7 Wastewater Revenue 3.5 3.5 Connection and Other Fees 3.8 3.3 Non-operating Revenues 32.1 16.9 Total Revenues 160.9 129.4 Depreciation Expense 18.4 18.3 Other Operating Expenses 125.6 113.0 Non-operating Expenses 4.9 32.4 Total Expenses 148.9 163.7 Income (Loss) Before Capital Contributions (12.0)(34.3) Capital Contributions 14.2 7.5 Change in Net Position 26.2 (26.8) Beginning Net Position, As Previously Stated 404.3 431.1 Prior Period Adjustment (0.2) 0.0 Beginning Net Position, As Restated 404.1 404.3 Ending Net Position $430.3 $404.3 Water Sales increased by $15.8 million in FY 2025 due to increase in sales volume brought about by dryer weather and the increase in water rates necessary to pass through increasing costs placed on the District. Other Operating Expenses increased by $12.6 million in FY 2025, predominantly due to increase in the cost of water caused by increased in water purchases and pass-through charges from the District’s water suppliers.Non-operating expenses decreased by $27.5 million due to the decrease in miscellaneous expenses. Specific planning and environmental study costs associated with capital projects do not qualify as capital miscellaneous (non-operating) expenses. For FY 2025,those expenses were $0.4 million. Management’s Discussion and Analysis Connection and Other Fees increased by $0.5 million in FY 2025 due to an increase in expansion-related operating costs, which are funded by capacity fees. Capital Contributions increased by $6.7 million in FY2025 due to more developer-built facilities. Non-operating Revenues Non-operating Revenues by Major Source (In Millions of Dollars) 2025 2024 Taxes and Assessments $6.2 $5.8 Rents and Leases 2.1 2.1 Other Non-operating Revenue 23.8 9.0 Total Non-operating Revenues $32.1 $16.9 The District's total non-operating revenues increased by $15.2 million in FY 2025 due primarily to the increase in taxes and assessments, and miscellaneous revenues partially offset by the decrease in investment earnings. Capital Assets and Debt Administration The District's capital assets (net of accumulated depreciation) as of June 30, 2025, totaled $447.3 million. Included in this amount is land, which is a non-depreciable asset.The District's net capital assets increased by 2.4% in FY 2025. Management’s Discussion and Analysis Capital Assets (In Millions of Dollars) As indicated by the figures in the table above, most capital assets added during the current fiscal year are related to the water systems.Additionally,most of the construction-in-progress cost is associated with water systems.Additional information on the District's capital assets can be found in Note 4 of the Notes to Financial Statements. On June 30, 2025 the District had $89.6 million in outstanding debt (net of $5.4 million of maturities occurring in FY 2026), which consisted of the following: Lease Payable $ 0.6 Subscription-Based IT Payable 4.6 Revenue Bonds 84.4 Total Long-Term Debt $ 89.6 2025 2024 Land $14.5 $14.5 Construction in Progress 20.8 10.7 Potable Water System 560.5 547.4 Recycled Water System 123.7 119.2 Wastewater System 59.3 59.3 Field Equipment 5.6 6.6 Buildings 19.3 19.3 Transportation Equipment 6.1 5.0 Communication Equipment 2.5 2.5 Office Equipment 8.0 8.0 Right to Use Assets –Leases 0.7 0.7 Right to Use Assets -SBITA 5.8 5.6 Total Capital Assets 826.8 798.8 Less Accumulated Depreciation (379.5)(361.9) Net Capital Assets $447.3 $436.9 Management’s Discussion and Analysis Additional information on the District's long-term debt can be found in Note 5 of the Notes to Financial Statements. Fiscal Year 2025-2026 Budget Economic Factors The San Diego region imports 67.0% of its potable supply;therefore, factors such as local rainfall and weather conditions elsewhere in the western portion of the nation can affect the region. San Diego received below-average rainfall of 4.68 inches in FY 2025.The 4.68 inches in 2025 is indicative of drought conditions. 10-year average of 10.22 inches for San Diego rainfall reflects the long-term drought conditions for our area.San Diego's rainfall average over 20 years is 9.0 inches,the 30-year average is 9.1 inches,and the 40-year average is 9.8 inches. Climate change poses a significant challenge for the District, with projections indicating longer droughts and more intense, though less frequent, rainfall. These extended droughts necessitate increased conservation efforts, leading to permanent reductions in water consumption. Consequently, water sales volumes are affected by both weather conditions and ongoing conservation measures. Although the impact is less pronounced than the measures implemented between 2008 and 2016, there has been a lasting change in usage patterns. For the fiscal year 2026, budgeted water sales volumes, based on actual data from 2021 to 2025, reflect a 0.5% decrease compared to the previous year's budgeted volume. The District continues to respond to the challenges presented by growth, State mandates,and drought,by creating new opportunities and new organizational efficiencies.Utilizing and refining its Strategic Business Plan has captured the Board of Directors'vision and united its staff in a joint mission.The District has achieved several significant accomplishments due to its successful adherence to its Strategic Business Plan. The District is poised to continue successfully providing an affordable, safe, and reliable water supply for the people of its service area, while also passing through the benefits of greater efficiencies and economies of scale. The District is currently at about 87.0%of its projected ultimate population, serving approximately 242,155 people. Long-term, this percentage should continue to increase as the District's service area develops and grows. By 2055,the District is projected to serve approximately 271,500 people.Currently, the District services the needs of this growing population by purchasing water from the San Diego County Water Authority (CWA), which in turn purchases its water from the Metropolitan Water District (MWD) and the Imperial Irrigation District (IID). Otay takes delivery of water through several connections of large-diameter pipelines owned and operated by CWA. The District receives treated water from CWA directly and from the Helix Water District via a CWA Management’s Discussion and Analysis contract. Additionally, the District has an emergency agreement with the City of San Diego to purchase water in the case of a shutdown of the primary treated water source. The City of San Diego also has a contract with the District to provide recycled water for landscape and irrigation usage. Through innovative agreements like these, both parties can benefit by using another agency's excess capacity and diversifying local supply, thereby increasing reliability. Financial The District is budgeted to deliver approximately 27,141.8 acre-feet of potable water to 52,070 potable customer accounts during FY 2026.The FY 2026 budget was prepared with the continuing challenges of potable water wholesale supplier rate increases, inflation, Proposition 218-related litigation defense, risk management challenges, additional CIP projects, and legislative initiatives. Additional challenges are the City of San Diego’s Pure Water program costs, and the County of San Diego’s rehabilitation of shared facilities. Inflation and increased regulation continue to impact the District’s financial position. The District’s wholesale water supplier has approved of a 10.4% overall rate increase in FY 2026 due to the high cost of supply programs, higher energy costs, and increasing operating costs. The FY 2026 material and administrative expenses are budgeted to increase by $2.2 million, while the CIP projects incorporate a 4.0% annual inflation rate from FY 2027 to FY 2031.SDG&E rate increases are expected to increase energy costs by 7.0%. Newly enacted regulatory requirements governing cross-connection are also putting pressure on the District’s operational costs, which include adding two new full-time equivalents to the staff in FY 2026. The District partially mitigates inflationary impacts through increasing returns on investments and long- term contracts with pricing structures that are fixed for the duration of the contract or include pricing structures whereby annual price increases are for fixed dollar amounts that are less than CPI levels. The District is addressing these challenges through careful financial planning, strategic prioritization of capital projects, and ongoing efforts to enhance efficiency and regulatory compliance, ensuring reliable service and long-term infrastructure sustainability. District staff projects that the District will sell another 496 water meters over the next six years,translating to 2,396 equivalent dwelling units (EDUs).This growth is estimated to increase sales volumes by an average of less than 1.0% per year over the next five years.While all these factors impact on the region's water usage, people's water needs remain an underlying constant. Certain claims, suits,and complaints arising in the ordinary course of operation have been filed or are pending against the District.There is one case that could potentially have a significant effect on the Management’s Discussion and Analysis District’s financial position.In November 2015, a District ratepayer filed a class-action lawsuit against the District (Coziahr v. Otay Water District, Superior Court of the State of California, County of San Diego), contending that the District’s tiered residential water rates from mid-2014 through 2022 violated Article XIIID of the California Constitution (“Proposition 218”). On March 4, 2021, the court issued a decision in favor of the plaintiffs, the District appealed the trial court’s decision to the Court of Appeal, and in July of 2024, the Court of Appeal issued its decision upholding much of the trial court’s decision, but remanding the issue of the allocation of refunds back to the trial court for a new trial. The matter has been remanded to the trial court for further proceedings as to the allocation of any refunds and for an award of attorneys’fees. See footnote 10 for additional details. Management is unaware of any other conditions that are likely to have a significant impact on the District's current financial position, net position,or operating results. Contacting the District's Financial Management This financial report provides a general overview of the Otay Water District's finances for the Board of Directors, customers, creditors, and other interested parties.Questions concerning any information provided in the report or requests for additional information should be addressed to the District's Finance Department, 2554 Sweetwater Springs Blvd., Spring Valley, CA 91978-2004. STATEMENT OF NET POSITION June 30, 2025 (with comparative totals as of June 30, 2024) 2025 2024 ASSETS Current Assets: Cash and Cash Equivalents (Notes 1 and 2)70,242,774$ 77,264,706$ Restricted Cash and Cash Equivalents (Notes 1 and 2)6,964,548 3,132,285 Investments (Notes 1 and 2)26,949,645 35,691,622 Restricted Investments (Notes 1 and 2)- 3,587,676 Accounts Receivable, Net 18,918,678 16,570,788 Accrued Interest Receivable 871,220 1,126,759 Taxes and Availability Charges Receivable, Net 331,528 287,785 Restricted Taxes and Availability Charges Receivable, Net - 4,884 Lease Receivable (Note 12)1,099,360 1,041,530 Inventories 1,956,892 2,073,038 Prepaid Items and Other Receivables 10,892,943 1,885,417 Total Current Assets 138,227,588 142,666,490 Non-current Assets: Capital Assets (Note 4): Land 14,479,573 14,479,573 Construction in Progress 20,767,290 10,712,815 Capital Assets, Net of Depreciation 412,021,645 411,694,772 Lease Receivable (Note 12)49,270,573 45,228,436 Total Non-current Assets 496,539,081 482,115,596 Total Assets 634,766,669 624,782,086 DEFERRED OUTFLOWS OF RESOURCES Deferred Actuarial Pension Costs (Note 7)7,180,263 13,279,616 Deferred Actuarial OPEB Costs (Note 8)9,280,373 12,206,112 Total Deferred Outflows of Resources 16,460,636 25,485,728 Continued The accompanying notes are an integral part of this statement. STATEMENT OF NET POSITION Continued June 30, 2025 (with comparative totals as of June 30, 2024) 2025 2024 LIABILITIES Current Liabilities: Accounts Payable 17,517,895$ 16,842,486$ Accrued Payroll Liabilities 1,353,567 1,095,145 Other Accrued Liabilities 7,048,375 6,247,354 Customer and Developer Deposits 5,087,873 5,490,122 Accrued Interest 1,415,093 1,491,005 Accrued liability 12,000,000 - Current Maturities of Long-term Debt (Note 5)5,417,783 5,224,677 Total Current Liabilities 49,840,586 36,390,789 Non-current Liabilities: Long-term Debt (Note 5): Revenue Bonds 84,383,503 89,430,762 Lease Payable 651,289 671,758 Subscription-Based IT Payable 4,564,337 4,914,393 Net Pension Liability (Note 7)25,428,994 28,553,945 Net OPEB Liability (Note 8)2,324,974 11,202,346 Other Non-current Liabilities (Note 9)4,049,281 30,548,589 Total Non-current Liabilities 121,402,378 165,321,793 Total Liabilities 171,242,964 201,712,582 DEFERRED INFLOWS OF RESOURCES Deferred Inflows from Leases (Note 12)46,429,877 43,410,817 Deferred Actuarial Pension Costs (Note 7)37,848 - Deferred Actuarial OPEB Costs (Note 8)3,248,114 870,274 Total Deferred Inflows of Resources 49,715,839 44,281,091 NET POSITION Net Investment in Capital Assets 351,783,163 336,050,508 Restricted for Debt Service 3,826,616 3,636,078 Restricted for Capital Assets 3,137,932 3,083,883 Unrestricted (Note 6)71,520,791 61,503,672 Total Net Position 430,268,502$ 404,274,141$ The accompanying notes are an integral part of this statement. STATEMENT OF REVENUES, EXPENSES, AND CHANGES IN NET POSITION Year Ended June 30, 2025 (with comparative totals for the year ended June 30, 2024) 2025 2024 OPERATING REVENUES Water Sales 121,483,491$ 105,736,843$ Wastewater Revenue 3,500,945 3,494,312 Connection and Other Fees 3,802,203 3,253,978 Total Operating Revenues 128,786,639 112,485,133 OPERATING EXPENSES Cost of Water Sales 89,595,836 77,807,009 Wastewater 2,578,457 2,400,881 Administrative and General 33,449,222 32,717,662 Depreciation 18,417,174 18,276,492 Total Operating Expenses 144,040,689 131,202,044 Operating Income (Loss)(15,254,050)(18,716,911) NON-OPERATING REVENUES (EXPENSES) Investment Earnings 5,998,937 6,393,523 Taxes and Assessments 6,171,087 5,777,012 Availability Charges 717,191 741,705 Gain (Loss) on Disposal of Capital Assets (228,041)(725,060) Rents and Leases 2,083,057 2,083,669 Miscellaneous Revenues 17,097,575 1,896,115 Donations (97,105)(103,200) Interest Expense (4,054,293)(4,137,615) Miscellaneous Expenses (394,535)(27,478,412) Total Non-operating Revenues (Expenses)27,293,873 (15,552,263) Income (Loss) Before Capital Contributions 12,039,823 (34,269,174) CAPITAL CONTRIBUTIONS: Capacity and Betterment Fees 4,489,090 7,221,234 Developer Contributions 9,698,540 247,052 Total Capital Contributions 14,187,630 7,468,286 Change in Net Position 26,227,453 (26,800,888) Total Net Position, Beginning, as Previously Reported 404,274,141 431,075,029 Restatement (Note 13)(233,092)- Total Net Position, Beginning, as Restated 404,041,049 431,075,029 Total Net Position, Ending 430,268,502$ 404,274,141$ The accompanying notes are an integral part of this statement. STATEMENT OF CASH FLOWS Year Ended June 30, 2025 (with comparative totals for the year ended June 30, 2024) 2025 2024 CASH FLOWS FROM OPERATING ACTIVITIES Receipts from Customers 122,234,297$ 106,875,559$ Receipts from Connections and Other Fees 3,802,203 3,253,978 Receipts from Property Rents and Leases - 52,127 Other Receipts 16,309,747 1,128,578 Payments to Suppliers (117,806,270) (53,512,056) Payments to Employees (30,267,716) (25,474,256) Other Payments (491,640) (27,581,612) Net Cash Provided By (Used For) Operating Activities (6,219,379) 4,742,318 CASH FLOWS FROM NONCAPITAL AND RELATED FINANCING ACTIVITIES Receipts from Taxes and Assessments 6,848,824 6,530,074 Net Cash Provided By (Used For) Noncapital and Related Financing Activities 6,848,824 6,530,074 CASH FLOWS FROM CAPITAL AND RELATED FINANCING ACTIVITIES Proceeds from Capital Contributions 4,489,090 7,221,234 Proceeds from Sale of Capital Assets 88,011 - Proceeds from Property Rents and Leases 1,682,954 1,630,303 Proceeds from Debt Related Taxes and Assessments 595 7,250 Principal Payments on Long-Term Debt (4,918,819) (5,452,872) Interest Payments and Fees (3,648,236) (3,814,672) Acquisition and Construction of Capital Assets (19,416,034) (6,690,118) Net Cash Provided By (Used For) Capital and Related Financing Activities (21,722,439) (7,098,875) CASH FLOWS FROM INVESTING ACTIVITIES Interest Received on Investments 4,870,493 4,146,000 Proceeds from Sale and Maturities of Investments 36,045,141 40,339,069 Purchase of Investments (23,012,309) (15,093,366) Net Cash Provided By (Used For) Investing Activities 17,903,325 29,391,703 Net Increase (Decrease) in Cash and Cash Equivalents (3,189,669) 33,565,220 Cash and Cash Equivalents - Beginning 80,396,991 46,831,771 Cash and Cash Equivalents - Ending 77,207,322$ 80,396,991$ Continued The accompanying notes are an integral part of this statement. STATEMENT OF CASH FLOWS Continued Year Ended June 30, 2025 (with comparative totals for the year ended June 30, 2024) 2025 2024 Reconciliation of Operating Income (Loss) to Net Cash Flows Provided By (Used For) Operating Activities: Operating Income (Loss)(15,254,050)$ (18,716,911)$ Adjustments to Reconcile Operating Income to Net Cash Provided By (Used For) Operating Activities: Depreciation 18,417,174 18,276,492 Receipts from Property Rents and Leases - 52,127 Miscellaneous Revenues 16,309,747 1,128,578 Miscellaneous Expenses and Donations (491,640) (27,581,612) (Increase) Decrease in Accounts Receivable (2,347,890) (2,257,124) (Increase) Decrease in Inventory 116,146 (19,645) (Increase) Decrease in Prepaid Items and Other Receivables (9,007,526) (384,165) (Increase) Decrease in Deferred Actuarial Pension Costs 6,099,353 2,671,458 (Increase) Decrease in Deferred Actuarial OPEB Costs 2,925,739 (5,526,881) Increase (Decrease) in Accounts Payable 675,409 1,857,268 Increase (Decrease) in Accrued Payroll and Related Expenses 25,330 (7,063) Increase (Decrease) in Accrued Liability 12,000,000 - Increase (Decrease) in Other Accrued Liabilities 801,021 518,076 Increase (Decrease) in Customer and Developer Deposits (402,249) (98,472) Increase (Decrease) in Other Non-current Liabilities (26,499,308) 26,780,121 Increase (Decrease) in Net OPEB Liability (8,877,372) 6,151,085 Increase (Decrease) in Net Pension Liability (3,124,951) 2,602,850 Increase (Decrease) in Deferred Actuarial Pension Costs 37,848 - Increase (Decrease) in Deferred Actuarial OPEB Costs 2,377,840 (703,864) Net Cash Provided By (Used For) Operating Activities (6,219,379)$ 4,742,318$ Schedule of Cash and Cash Equivalents: Current Assets: Cash and Cash Equivalents 70,242,774$ 77,264,706$ Restricted Cash and Cash Equivalents 6,964,548 3,132,285 Total Cash and Cash Equivalents 77,207,322$ 80,396,991$ Supplemental Disclosures Non-Cash Investing and Financing Activities Consisted of the Following: Contributed Capital for Water and Sewer System 9,698,540$ 247,052$ Change in Fair Value of Investments (703,179) (1,299,473) Amortization Related to Long-term Debt 305,859 377,676 The accompanying notes are an integral part of this statement. Notes To Financial Statements Year Ended June 30, 2025 1)REPORTING ENTITY AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES A)Reporting Entity The reporting entity Otay Water District (the “District”) includes the accounts of the District and the Otay Water District Financing Authority (the “Financing Authority”). The District is a public entity established in 1956 pursuant to the Municipal Water District Law of 1911 (Section 711 et. Seq. of the California Water Code) for the purpose of providing water and wastewater services to the properties in the District.The District is governed by a Board of Directors consisting of five directors elected by geographical divisions based on District population for a four-year alternating term. The District formed the Financing Authority on March 3, 2010 under the Joint Exercise of Powers Act, constituting Articles 1 through 4 (commencing with Section 6500) of Chapter 5, Division 7, Title 1 of the California Government Code. The Financing Authority was formed to assist the District in the financing of public capital improvements. The financial statements present the District and its component unit. The District is the primary government unit.Component units are those entities which are financially accountable to the primary government, either because the District appoints a voting majority of the component unit’s board, or because the component units will provide a financial benefit or impose a financial burden on the District. The District has accounted for the Financing Authority as a “blended” component unit. Despite being legally separate, the Financing Authority is so intertwined with the District that it is in substance, part of the District’s operations. Accordingly, the balances and transactions of this component unit are reported within the funds of the District. Separate financial statements are not issued for the Financing Authority. B)Measurement Focus, Basis of Accounting and Financial Statement Presentation Measurement focus is a term used to describe “which” transactions are recorded within the various financial statements. Basis of accounting refers to “when” transactions are recorded regardless of the measurement focus applied. The accompanying financial statements are reported using the economic resources measurement focus, and the accrual basis of accounting. Under the economic measurement focus all assets and liabilities (whether current or noncurrent) associated with these activities are included in the Statement of Net Position. Notes To Financial Statements Year Ended June 30, 2025 1)REPORTING ENTITY AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES –Continued B)Measurement Focus, Basis of Accounting and Financial Statement Presentation -Continued The Statement of Revenues, Expenses and Changes in Net Position present increases (revenues) and decreases (expenses) in total net position. Under the accrual basis of accounting, revenues are recorded when earned and expenses are recorded when a liability is incurred, regardless of the timing of related cash flows. The District reports its activities as an enterprise fund, which is used to account for operations that are financed and operated in a manner similar to a private business enterprise, where the intent of the District is that the costs (including depreciation) of providing goods or services to the general public on a continuing basis be financed or recovered primarily through user charges. The basic financial statements of the Otay Water District have been prepared in conformity with accounting principles generally accepted in the United States of America. The Governmental Accounting Standards Board (GASB) is the accepted standard setting body for governmental accounting financial reporting purposes. Net position of the District is classified into three components: (1) net investment in capital assets, (2) restricted net position, and (3) unrestricted net position. These classifications are defined as follows: Net Investment in Capital Assets This component of net position consists of capital assets, net of accumulated depreciation and reduced by the outstanding balances of notes or borrowing that are attributable to the acquisition of the assets, construction, or improvement of those assets. If there are significant unspent related debt proceeds at year-end, the portion of the debt attributable to the unspent proceeds are not included in the calculation of the net investment in capital assets. Restricted Net Position This component of net position consists of net position with constrained use through external constraints imposed by creditors (such as through debt covenants), grantors, contributions, or laws or regulations of other governments or constraints imposed by law through constitutional provisions or enabling legislation. Notes To Financial Statements Year Ended June 30, 2025 1)REPORTING ENTITY AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES -Continued B)Measurement Focus, Basis of Accounting and Financial Statement Presentation -Continued Unrestricted Net Position This component of net position consists of net position that do not meet the definition of “net investment in capital assets” or “restricted net position”. The District distinguishes operating revenues and expenses from those revenues and expenses that are non-operating. Operating revenues are those revenues that are generated by water sales and wastewater services while operating expenses pertain directly to the furnishing of those services. Non- operating revenues and expenses are those revenues and expenses generated that are not associated with the normal business of supplying water and wastewater treatment services. The District recognizes revenues from water sales, wastewater revenues, and meter fees as they are earned. Taxes and assessments are recognized as revenues based upon amounts reported to the District by the County of San Diego, net of allowance for delinquencies of $36,837 at June 30, 2025. Additionally, capacity fee contributions received which are related to specific operating expenses are offset against those expenses and included in Cost of Water Sales in the Statement of Revenues and Expenses and Changes in Net Position. Sometimes the District will fund outlays for a particular purpose from both restricted (e.g., restricted bond or grant proceeds) and unrestricted resources. In order to calculate the amounts to report as restricted -net position and unrestricted -net position, a flow assumption must be made about the order in which the resources are considered to be applied.It is the District’s practice to consider restricted -net position to have been depleted before unrestricted -net position is applied, however it is at the Board’s discretion. Notes To Financial Statements Year Ended June 30, 2025 1)REPORTING ENTITY AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES -Continued C)Implementation of New and Pending Accounting Pronouncements During the year ended June 30, 2025, the District adopted new accounting guidance by implementing the provisions of Governmental Accounting Standards Board (GASB) Statement No. 101, Compensated Absences, which seeks to better meet the information needs of financial statement users by updating the recognition and measurement guidance for compensated absences. See Note 13. GASB has issued the following statements which may impact the District’s financial reporting requirements in the future: i.GASB Statement 103 -“Financial Reporting Model Improvements”, effective for reporting periods beginning after June 15, 2025. ii.GASB Statement 104 –“Disclosure of Certain Capital Assets”, effective for reporting periods beginning after June 15, 2025. D)Deferred Outflows/Deferred Inflows In addition to assets, the Statement of Net Position will sometimes report a separate section for deferred outflows of resources. This separate financial statement element, deferred outflows of resources, represents a consumption of net assets that applies to a future period(s) and so will not be recognized as an outflow of resources (expense/expenditure) until then. The District has two items that qualify for reporting in this category: deferred actuarial pension costs and deferred actuarial OPEB costs. These are items that are deferred and recognized as an outflow of resources in the period the amounts become available. In addition to liabilities, the Statement of Net Position will sometimes report a separate section for deferred inflows of resources. This separate financial statement element, deferred inflows of resources, represents an acquisition of net assets that applies to a future period(s) and will not be recognized as an inflow of resources (revenue) until that time. The District has three items that qualify for reporting in this category. Accordingly, the items (deferred actuarial pension costs, deferred actuarial OPEB costs and deferred lease revenue)are deferred and recognized as an inflow of resources in the period that the amounts become available. Notes To Financial Statements Year Ended June 30, 2025 1)REPORTING ENTITY AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES –Continued E)Statement of Cash Flows For purposes of the Statement of Cash Flows, the District considers all highly liquid investments (including restricted assets) with a maturity period, at purchase, of three months or less to be cash equivalents. F)Investments Investments are stated at their fair value, which represents the quoted or stated market value. Investments that are not traded on a market, such as investments in external pools, are valued based on the stated fair value as presented by the external pool. G)Inventory and Prepaid Items Inventory consists primarily of materials used in the construction and maintenance of the water and wastewater system and is valued at weighted average cost. Both inventory and prepaid items use the consumption method whereby they are reported as an asset and expensed as they are consumed. In Fiscal Year 2025, the District made an advance payment to the San Diego County Water Authority (SDCWA) covering 12 months of fixed charges for the calendar year 2025. The total gross amount of the charges was $18,727,944. In recognition of the early payment, the District received a 4% discount totaling $749,118, resulting in a net payment of $17,978,826. As of June 30, 2025, the remaining balance related to this advance payment was $8,989,409, which is included in prepaid expenses. This balance represents a portion of the prepaid charges applicable to the second half of the calendar year 2025. H)Capital Assets Capital assets are recorded at cost, where historical records are available, and at an estimated historical cost where no historical records exist. Right-to-use assets for leases and subscription-based information technology arrangements are recorded at net present value at the time of inception.Infrastructure assets in excess of $20,000 and other capital assets in excess of $10,000 are capitalized if they have an expected useful life of two years or more. Notes To Financial Statements Year Ended June 30, 2025 1)REPORTING ENTITY AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES –Continued H)Capital Assets –Continued The District will also capitalize individual purchases under the capitalization threshold if they are part of a new capital program. The cost of purchased and self-constructed additions to utility plant and major replacements of property are capitalized.Costs include materials, direct labor, transportation, and such indirect items as engineering, supervision, employee fringe benefits and overhead. Repairs, maintenance, and minor replacements of property are charged to expense. Donated assets are capitalized at their acquisition value on the date contributed. Depreciation is calculated using the straight-line method over the following estimated useful lives: Building and Improvements 5-50 Years Water System (Pot & Rec)7-75 Years Field Equipment 3-25 Years Fleet Equipment 3-10 Years Communication Equipment 5-10 Years Office Equipment 3-10 Years Sewer System 7-75 Years Right to Use Asset/SBITA Based on the terms of underlying lease/subscription contracts, whichever is shorter. I)Other Non-Current Liabilities For compensated absences, the District’s policy is to record vested and accumulated vacation and sick leave as an expense and liability as benefits accrue to employees.The current portion is reflected in accrued payroll liabilities and remainder in other non-current liabilities on the Statement of Net Position. The liability is calculated using current pay rates and includes employer-paid fringe benefits. J)Classification of Liabilities Certain current liabilities have been classified as current liabilities payable from restricted assets as they will be funded from restricted assets. Notes To Financial Statements Year Ended June 30, 2025 1)REPORTING ENTITY AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES -Continued K)Allowance for Doubtful Accounts The District charges doubtful accounts arising from water sales receivable to bad debt expense when it is probable that the accounts will be uncollectible. Uncollectible accounts are determined by the allowance method based upon prior experience and management’s assessment of the collectability of existing specific accounts. The allowance for doubtful accounts was $232,454 for 2025. L)Property Taxes Tax levies are limited to 1% of full market value (at time of purchase) which results in a tax rate of $1.00 per $100 assessed valuation, under the provisions of Proposition 13. Tax rates for voter- approved indebtedness are excluded from this limitation. The County of San Diego (the “County”) bills and collects property taxes on behalf of the District. The County’s tax calendar year is July 1 to June 30. Property taxes attach as a lien on property on January 1. Taxes are levied on July 1 and are payable in two equal installments on November 1 and February 1, and become delinquent after December 10 and April 10, respectively. M)Pensions For purposes of measuring the net pension liability,deferred outflows of resources, and deferred inflows of resources related to pensions, and pension expense, information about the fiduciary net position of the Plan and additions to/deductions from the Plans’ fiduciary net position have been determined on the same basis.For this purpose, benefit payments (including refunds of employee contributions) are recognized when currently due and payable in accordance with the benefit terms. Investments are reported at fair value. Valuation Date June 30, 2023 Measurement Date June 30, 2024 Measurement Period July 1, 2023 to June 30, 2024 Notes To Financial Statements Year Ended June 30, 2025 1)REPORTING ENTITY AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES -Continued N)Other Post-Employment Benefits (OPEB) For purposes of measuring the net OPEB liability(asset), deferred outflows/inflows of resources related to OPEB, and OPEB expense, information about the fiduciary net position of the District’s plan (OPEB Plan) and additions to/deductions from the OPEB Plan’s fiduciary net position have been determined on the same basis. For this purpose, benefit payments are recognized when currently due and payable in accordance with the benefit terms. Investments are reported at fair value. Generally accepted accounting principles require that the reported results must pertain to liability and asset information within certain defined timeframes. For this report, the following timeframes are used: Valuation Date June 30, 2024 Measurement Date June 30, 2024 Measurement Period July 1, 2023 to June 30, 2024 O)Leases The District is a lessor and lessee for leases as detailed in Footnotes 5 and 12. The District recognizes a lease receivable, a deferred inflow of resources, right to use capital assets, and a lease payable in the financial statements. At the commencement of the lease, the District initially measures the lease receivable at the present value of payments expected to be received and paid during the lease term. Subsequently, the lease receivable is reduced by the principal portion of lease payments received and the lease payable is reduced by the principal portion of lease payments made. The deferred inflow of resources is initially measured as the initial amount of the lease receivable, adjusted for lease payments received at or before the lease commencement date.Subsequently, the deferred inflows of resources are recognized as revenue over the life of the lease term. Key estimates and judgments include how the district determines the discount rate it uses to discount the expected lease receipts and payments to present value, lease term and lease receipts. The District used the weighted average cost of capital rate as the discount rate for leases. The lease term includes the non-cancellable period of the lease. The District monitors changes in circumstances that would require a remeasurement of its leases and will remeasure the lease receivable and deferred inflows of resources if certain changes occur that are expected to significantly affect the amount of the lease receivable. Notes To Financial Statements Year Ended June 30, 2025 1)REPORTING ENTITY AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES -Continued P)Subscription Based Information Technology Arrangements (SBITAs) The District is a participant in subscription-based IT arrangements as detailed in Footnote 5.The District recognizes a subscription-based IT payable and the right to use IT assets in the financial statements.At the commencement of the arrangement, the District initially measures the payable at the present value of payments expected to be paid during the arrangement term.Subsequently, the payable is reduced by the principal portion of payments made. The right to use assets are initially measured at the initial amount of the subscription-based IT payable. Subsequently, the right to use assets are amortized over the life of the arrangement term. Q)Use of Estimates The preparation of financial statements in conformity with generally accepted accounting principles in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets, deferred outflows of resources, liabilities, and deferred inflows of resources, and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. R)Prior Year Comparative Information Selected information regarding the prior year has been included in the accompanying financial statements. This information has been included for comparison purposes only and does not represent a complete presentation in accordance with generally accepted accounting principles. Accordingly, such information should be read in conjunction with the government’s prior year financial statements, from which this selected financial data was derived. In addition, certain minor reclassifications of the prior year data have been made to enhance their comparability to the current year. 2)CASH AND INVESTMENTS The primary goals of the District’s Investment Policy are to assure compliance with all Federal, State, and Local laws governing the investment of funds under the control of the organization, protect the principal of investments entrusted, remain sufficiently liquid to enable the District to meet all operating requirements and generate income at a market rate of return under the parameters of such policies. Notes To Financial Statements Year Ended June 30, 2025 2)CASH AND INVESTMENTS -Continued Cash and Investments are classified in the accompanying financial statements as follows: Cash and Investments consist of the following: Cash and investments are restricted for the cost of the following District projects and debt service: Investments Authorized by the California Government Code and the District’s Investment Policy The table on the following page identifies the investment types that are authorized for the District by the California Government Code (or the District’s Investment Policy, where more restrictive). The table also identifies certain provisions of the California Government Code (or the District’s Investment Policy, where more restrictive) that address interest rate risk, credit risk, and concentration of credit risk. This table does not address investments of debt proceeds held by bond trustees that are governed by the provisions of debt agreements of the District, rather than the general provisions of the California Government Code or the District’s Investment Policy. Statement of Net Position: Cash and Cash Equivalents 70,242,774$ Restricted Cash and Cash Equivalents 6,964,548 Investments 26,949,645 Total Cash and Investments 104,156,967$ Cash on Hand 3,100$ Deposits with Financial Institutions 1,358,505 Investments 102,795,362 Total Cash and Investments 104,156,967$ Cash and Cash Equivalents: New Water Supply 3,137,931$ Debt Service: Water Revenue Bond Series 2010A 1,055,200 Water Revenue Bond Series 2010B 2,771,417 6,964,548$ Notes To Financial Statements Year Ended June 30, 2025 2)CASH AND INVESTMENTS -Continued Maximum Maximum Authorized Maximum Percentage Investment Investment Type Maturity Of Portfolio(1)In One Issuer U.S. Treasury Obligations 5 years 100%100% U.S. Government Sponsored Entities 5 years 100%100% Certificates of Deposit 5 years 15%100% Corporate Medium-Term Notes 5 years 10%2% Commercial Paper 270 days 10%2% Money Market Mutual Funds N/A 10%100% County Pooled Investment Funds N/A 100%N/A Local Agency Investment Fund (LAIF)N/A $75 Million N/A (1)Excluding amounts held by bond trustee that are not subject to California Government Code restrictions. Investments Authorized by Debt Agreements Investments of debt proceeds held by the bond trustee are governed by provisions of the debt agreements, rather than the general provisions of the California Government Code or the District’s Investment Policy. Disclosures Relating to Interest Rate Risk Interest rate risk is the risk that changes in market interest rates will adversely affect the fair value of an investment. Generally,the longer the maturity of an investment, the greater the sensitivity of its fair value to changes in market interest rates. One of the ways that the District manages its exposure to interest rate risk is by purchasing investments with shorter durations than the maximum allowable under the District’s Investment Policy and by timing cash flows from maturities,so that a portion of the portfolio is maturing or coming close to maturity evenly over time,as necessary,to provide the cash flow and liquidity needed for operations. Information about the sensitivity of the fair values of the District’s investments to market interest rate fluctuations are provided by the following tables that show the distribution of the District’s investments by maturity as of June 30, 2025. Notes To Financial Statements Year Ended June 30, 2025 2)CASH AND INVESTMENTS –Continued Generally, credit risk is the risk that an issuer of an investment will not fulfill its obligation to the holder of the investment. This is measured by the assignment of a rating by a nationally recognized statistical rating organization. Presented below is the minimum rating required by (where applicable) the California Government Code or the District’s Investment Policy, or debt agreements, and the Moody’s ratings as of June 30, 2025. Concentration of Credit Risk The investment policy of the District contains various limitations on the amounts that can be invested in any one type or group of investments and in any issuer, beyond that stipulated by the California Government Code, Sections 53600 through 53692. All the investments for fiscal year 2025 are within the limitations of the District’s investment policy. 12 Months 13 to 36 More than Investment Type Total Or Less Months 36 Months U.S. Government Sponsored Entities $ 24,243,998 12,737,878$ 11,506,120$ -$ U.S. Treasury Obligations 15,467,575 13,475,115 1,992,460 - Local Agency Investment Fund (LAIF) 62,459,916 62,459,916 - - San Diego County Pool 114,000 114,000 - - Money Market Funds 509,873 509,873 - - Total $ 102,795,362 $ 89,296,782 $ 13,498,580 -$ Remaining Maturity (in Months) Legal Minimum Not Investment Type Total Rating AAA Aa1 Rated U.S. Government Sponsored Entities $ 24,243,998 A -$ 24,243,998$ -$ U.S. Treasury Obligations 15,467,575 N/A - 15,467,575 - Local Agency Investment Fund (LAIF) 62,459,916 N/A - - 62,459,916 San Diego County Pool 114,000 N/A - - 114,000 Money Market Funds 509,873 N/A 509,873 - - Total $ 102,795,362 $ 509,873 $ 39,711,573 $ 62,573,916 Rating as of Year End Notes To Financial Statements Year Ended June 30, 2025 2)CASH AND INVESTMENTS –Continued The investments listed below disclose the concentration of risk within the District’s investment portfolio. Investments in any one issuer (other than U.S. Treasury securities, mutual funds, and external investment pools) that represent 5% or more of total District investments as of June 30, 2025: Custodial Credit Risk Custodial credit risk for deposits is the risk that, in the event of the failure of a depository financial institution, the District will not be able to recover its deposits or will not be able to recover collateral securities that are in the possession of an outside party. The custodial credit risk for investments is the risk that, in the event of the failure of the counterparty (e.g., broker-dealer) to a transaction, the District will not be able to recover the value of its investment or collateral securities that are in the possession of another party. The California Government Code and the District’s Investment Policy do not contain legal or policy requirements that would limit the exposure to custodial credit risk for deposits or investments, other than the following provision for deposits: The California Government Code requires that a financial institution secure deposits made by state or local government units by pledging securities in an undivided collateral pool held by a depository regulated under state law (unless so waived by the governmental unit). The fair value of the pledged securities in the collateral pool must equal at least 110% of the total amount deposited by the District. California law also allows financial institutions to secure deposits by pledging first trust deed mortgage notes having a value of 150% of the secured public deposits.As of June 30, 2025, $2,649,374 of the District’s deposits with financial institutions in excess of federal depository insurance limits, were held in collateralized accounts. Local Agency Investment Fund (LAIF) The District is a voluntary participant in the Local Agency Investment Fund (LAIF) that is regulated by California Government Code Section 16429 under the oversight of the Treasurer of the State of California. Reported Issuer Investment Type Amount Federal Home Loan Bank U.S. Government Sponsored Entities 8,484,600$ Federal Farm Credit Bank U.S. Government Sponsored Entities 10,024,380 Notes To Financial Statements Year Ended June 30, 2025 2)CASH AND INVESTMENTS –Continued The fair value of the District’s investment in this pool is reported in the accompanying financial statements at amounts based upon District’s pro-rata share of the fair value provided by LAIF for the entire LAIF portfolio (in relation to the amortized cost of that portfolio). The balance available for withdrawal is based on the accounting records maintained by LAIF, which are recorded on an amortized cost basis. The LAIF is a special fund of the California State Treasury through which local governments may pool investments. The District may invest up to $75,000,000 in the fund. Investments in LAIF are highly liquid, as deposits can be converted to cash within twenty-four hours without loss of interest. Investments with LAIF are secured by the full faith and credit of the State of California. The annualized yield of LAIF for the quarter ended June 30, 2025 was 4.27%. The estimated amortized cost and fair value of the LAIF pool at June 30, 2025 was $62,459,916. San Diego County Pooled Fund The San Diego County Pooled Investment Fund (SDCPIF) is a pooled investment fund program governed by the County of San Diego Board of Supervisors and administered by the County of San Diego Treasurer and Tax Collector. Investments in SDCPIF are highly liquid as deposits and withdrawals can be made at any time without penalty, determined on an amortized cash basis, the same as the fair value of the District’s position in the pool.The estimated amortized cost and fair value of the County pool at June 30, 2025 was $114,000. The County of San Diego’s bank deposits are either federally insured or collateralized in accordance with the California Government Code. Pool detail is included in the County of San Diego Annual Comprehensive Financial Report (“Annual Report”). Copies of the Annual Report may be obtained from the County of San Diego Auditor-Controller’s Office –1600 Pacific Coast Highway, San Diego California 92101. Notes To Financial Statements Year Ended June 30, 2025 3)FAIR VALUE MEASUREMENTS Governmental Accounting Standards Board (GASB) Statement No. 72, Fair Value Measurements and Application, provides the framework for measuring fair value. The framework provides a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value with Level 1 given the highest priority and Level 3 the lowest priority. The three levels of the fair value hierarchy are as follows: Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities that the organization has the ability to access at the measurement date. Level 2 inputs are inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. Level 2 inputs include the following: a.Quoted prices for similar assets or liabilities in active markets. b.Quoted prices for identical or similar assets or liabilities in markets that are not active. c.Inputs other than quoted prices that are observable for the asset or liability (for example, interest rates and yield curves observable at commonly quoted intervals, volatilities, prepayment speeds, loss severities, credit risks, and default rates). d.Inputs that are derived principally from or corroborated by observable market data by correlation or other means (market-corroborated inputs). Level 3 inputs are unobservable inputs for the asset or liability. Notes To Financial Statements Year Ended June 30, 2025 3)FAIR VALUE MEASUREMENTS -Continued Fair value of assets measured on a recurring basis at June 30, 2025 are as follows: Investments classified in Level 2 of the fair value hierarchy are valued using a matrix pricing technique. Matrix pricing is used to value securities based on the securities’ relationship to benchmark quoted prices. Investments not measured at fair value do not fall under the fair value hierarchy as there is no active market for the investments. Quoted Prices in Significant Other Active Markets Observable Inputs Not Measured Total (Level 1)(Level 2)at Fair Value U.S. Government Sponsored Entities 24,243,998$ -$ 24,243,998$ -$ U.S. Treasury Obligations 15,467,575 15,467,575 - - Local Agency Investment Fund (LAIF) 62,459,916 - - 62,459,916 San Diego County Pool 114,000 - - 114,000 Money Market Funds 509,873 - - 509,873 Total $102,795,362 $ 15,467,575 $ 24,243,998 $ 63,083,789 Notes To Financial Statements Year Ended June 30, 2025 4)CAPITAL ASSETS The following is a summary of changes in Capital Assets for the year ended June 30, 2025: Depreciation expense for the year ended June 30, 2025 was $18,417,174. Beginning Ending Balance Additions Deletions Balance Capital Assets, Not Depreciated: Land $ 14,479,573 $ - $ - $ 14,479,573 Construction in Progress 10,712,815 19,416,035 (9,361,560) 20,767,290 Total Capital Assets, Not Depreciated 25,192,388 19,416,035 (9,361,560) 35,246,863 Capital Assets, Being Depreciated: Infrastructure 725,898,078 18,277,862 (644,404) 743,531,536 Field Equipment 6,641,125 180,301 (1,200,573) 5,620,853 Buildings 19,259,406 46,938 (8,126) 19,298,218 Transportation Equipment 4,971,706 1,424,280 (346,506) 6,049,480 Communication Equipment 2,505,474 - - 2,505,474 Office Equipment 7,977,045 - - 7,977,045 Right to Use Assets - Antenna Site 738,501 - - 738,501 Right to Use Assets - SBITA 5,622,806 208,122 (16,611) 5,814,317 Total Capital Assets, Being Depreciated 773,614,141 20,137,503 (2,216,220) 791,535,424 Less Accumulated Depreciation: Infrastructure 332,211,316 16,517,546 (333,493) 348,395,369 Field Equipment 5,152,864 224,482 (123,171) 5,254,175 Buildings 11,109,324 474,726 (2,983) 11,581,067 Transportation Equipment 3,184,435 480,210 (346,506) 3,318,139 Communication Equipment 2,259,444 84,527 - 2,343,971 Office Equipment 7,564,951 133,025 - 7,697,976 Right to Use Assets - Antenna Site 105,500 35,167 - 140,667 Right to Use Assets - SBITA 331,535 467,491 (16,611) 782,415 Total Accumulated Depreciation 361,919,369 18,417,174 (822,764) 379,513,779 Total Capital Assets, Being Depreciated, Net 411,694,772 1,720,329 (1,393,456) 412,021,645 Total Capital Assets, Net $ 436,887,160 $ 21,136,364 $ (10,755,016) $ 447,268,508 Notes To Financial Statements Year Ended June 30, 2025 5) LONG-TERM DEBT Long-term liabilities for the year ended June 30, 2025 are as follows: Water Revenue Bonds In April 2010, Water Revenue Bonds with a face value of $50,195,000 were sold by the Otay Water District Financing Authority to provide funds for the construction of water storage and transmission facilities. The bond issue consisted of two series; Water Revenue Bonds, Series 2010A (Non-AMT Tax Exempt) with a face value of $13,840,000 plus a $1,078,824 original issue premium, and Water Revenue Bonds,Series 2010B (Taxable Build America Bonds) with a face value of $36,355,000. The Series 2010A bonds are due in annual installments of $785,000 to $1,295,000 from September 1, 2012 through September 1, 2024; bearing interest at 2% to 5.25%. The Series 2010B bonds are due in annual installments of $1,365,000 to $3,505,000 from September 1, 2025 through September 1, 2040; bearing interest at 6.377% to 6.577%. Beginning Ending Due Within Balance Additions Deletions Balance One Year Revenue Bonds: 2010 Water Revenue Bonds Series A 1,295,000$ -$ (1,295,000)$ -$ -$ 2010 Water Revenue Bonds Series B 36,355,000 - - 36,355,000 1,365,000 2016 Water Revenue Refunding Bonds 24,020,000 - (1,420,000) 22,600,000 1,495,000 2018 Water Revenue Bonds 25,405,000 - (1,730,000) 23,675,000 1,820,000 2019 Wastewater Revenue Bonds 2,910,000 - (75,000) 2,835,000 80,000 2010 Series A Unamortized Premium 18,600 - (18,600) - - 2016 Bonds Unamortized Premium 2,172,619 - (178,572) 1,994,047 178,571 2018 Bonds Unamortized Premium 2,092,006 - (109,148) 1,982,858 109,148 2019 Bonds Unamortized Discount (11,605) - 461 (11,144) (461) Net Revenue Bonds 94,256,620 - (4,825,859) 89,430,761 5,047,258 Lease Payable 690,539 - (18,781) 671,758 20,469 Subscription-Based IT Payable 5,294,431 - (380,038) 4,914,393 350,056 Total Long-Term Liabilities 100,241,590$ -$ (5,224,678)$ 95,016,912$ 5,417,783$ Notes To Financial Statements Year Ended June 30, 2025 5)LONG-TERM DEBT –Continued Water Revenue Bonds –Continued Interest on both Series is payable on September 1, 2010 and semiannually thereafter on March 1st and September 1st of each year until maturity or earlier redemption. The installment payments are to be made from taxes and net revenues of the Water System as described in the installment purchase agreement, on parity with the payments required to be made by the District for the 2010, 2016 Water Revenue Refunding Bonds and 2018 Water Revenue Bonds described below. The 2010 Water Revenue Bonds contains various covenants and restrictions, principally that the District fix, prescribe, revise and collect rates, fees and charges for the Water System which will at least be sufficient to yield, during each fiscal year, taxes and net revenues equal to one hundred twenty-five percent (125%) of the debt service for such fiscal year. The District was in compliance with these rate covenants for the fiscal year ended June 30, 2025. In May 2016, Water Revenue Refunding Bonds were issued to defease the 2007 Revenue Certificates of Participation. The bonds are due in annual installments of $1,200,000 to $2,235,000 from September 1, 2016 through September 1, 2036; bearing interest of 2%to 5%. The bonds were issued with a face value of $33,385,000 plus $3,630,950 original issue premium. The original issue premium is being amortized over the 20-year life of the Series 2016 bonds. Amortization for the year ending June 30, 2025 was $178,572. The amortization is included in interest expense. The unamortized premium at June 30, 2025 is $1,994,047. In November 2018, Water Revenue Bonds were issued by the Otay Water District Financing Authority to provide funds for construction of water storage, treatment and transmission facilities and to refinance the 1996 Certificates of Participation. The bonds are due in annual installments of $775,000 to $1,915,000 from September 1, 2019 through September 1, 2043; bearing interest of 3% to 5%. The bonds were issued with a face value of $32,435,000 plus $2,710,512 original issue premium. The original issue premium is being amortized over the 25-year life of the Series 2018 bonds. Amortization for the year ending June 30, 2025 was $109,148. The amortization expense is included in interest expense. The unamortized premium at June 30, 2025 is $1,982,858. Notes To Financial Statements Year Ended June 30, 2025 5)LONG-TERM DEBT –Continued Water Revenue Bonds –Continued The total amount outstanding at June 30, 2025 and aggregate maturities of the revenue bonds for the fiscal years subsequent to June 30, 2025, are as follows: For the Year Ended June 30,Principal Interest 2026 1,365,000$ 2,328,345$ 2027 1,450,000 2,238,589 2028 1,545,000 2,143,093 2029 1,640,000 2,041,540 2030 1,745,000 1,933,609 2031-2035 10,570,000 7,756,703 2036-2040 14,535,000 3,664,211 2041 3,505,000 115,262 36,355,000$ 22,221,352$ 2010 Water Revenue Bond Series B For the Year Ended June 30,Principal Interest Principal Interest 2026 1,495,000$ 733,706$ 1,820,000$ 972,538$ 2027 1,570,000 657,081 1,915,000 879,163 2028 1,645,000 584,931 1,030,000 805,538 2029 1,715,000 517,731 1,080,000 752,788 2030 1,785,000 447,731 1,135,000 697,413 2031-2035 9,985,000 1,319,884 6,485,000 2,663,513 2036-2040 4,405,000 130,413 6,360,000 1,346,744 2041-2044 - - 3,850,000 274,400 22,600,000$ 4,391,477$ 23,675,000$ 8,392,097$ Refunding Bonds Revenue Bonds 2016 Water Revenue 2018 Water Notes To Financial Statements Year Ended June 30, 2025 5)LONG-TERM DEBT –Continued Wastewater Revenue Bonds In December 2019, Wastewater Revenue Bonds were issued by the Otay Water District Financing Authority to provide funds to pay for certain capital improvements to the District’s wastewater system. The bonds are due in annual installments of $65,000 to $160,000 from September 1, 2021 through September 1, 2049; bearing interest of 2% to 3.125%. The bonds were issued with a face value of $3,120,000 less a $13,680 original issue discount. The original issue discount is being amortized over the 30-year life of the Series 2019 bonds. Amortization for the year ending June 30, 2025 was $461. The amortization expense is included in interest expense. The unamortized discount at June 30,2025 is $11,144. The 2019 Wastewater Revenue Bonds contains various covenants and restrictions, principally that the District fix, prescribe, revise and collect rates, fees and charges for the Wastewater System which will at least be sufficient to yield, during each fiscal year, net revenues equal to one hundred fifteen percent (115%) of the debt service for such fiscal year. The District was in compliance with these rate covenants for the fiscal year ended June 30, 2025. Future debt service requirements for the bonds are as follows: For the Year Ended June 30,Principal Interest 2026 80,000$ 83,091$ 2027 80,000 80,691 2028 85,000 78,216 2029 85,000 75,666 2030 90,000 73,041 2031-2035 480,000 326,394 2036-2040 550,000 255,095 2041-2045 635,000 167,191 2046-2050 750,000 60,156 2,835,000$ 1,199,541$ 2019 Wastewater Revenue Bonds Notes To Financial Statements Year Ended June 30, 2025 5)LONG-TERM DEBT –Continued Revenues Pledged The District has pledged a portion of future water sales revenues to repay its Water Revenue and Water Revenue Refunding Bonds. The total principal and interest remaining on the water revenue bonds and water revenue refunding bonds is $117,634,926 payable through fiscal year 2044. For June 30, 2025, principal and interest paid by the water sales revenues were $4,445,000 and $4,273,731 respectively. The District has pledged a portion of future wastewater sales revenues to repay its Wastewater Revenue Bonds. The total principal and interest remaining on the wastewater revenue bonds is $4,034,541 payable through fiscal year 2050. For June 30, 2025, principal and interest paid by the wastewater sales revenues were $75,000 and $85,416, respectively. Lease Payable Antenna Site Lease The District has one antenna site sublease payable with a lease term of forty-eight years. The District is required to make annual fixed payments ranging from $15,100 to $64,303, with a discount rate of 1.39%. The lease has three extension options of five years each. As of June 30, 2025, the value of the lease payable is $671,758. Future lease payable requirements are as follows: For the Year Ended June 30,Principal Interest 2026 20,469$ 9,207$ 2027 22,253 8,911 2028 24,134 8,590 2029 26,114 8,242 2030 28,206 7,866 2031-2035 176,710 32,582 2036-2040 249,214 17,930 2041-2042 124,658 1,834 671,758$ 95,162$ Notes To Financial Statements Year Ended June 30, 2025 5)LONG-TERM DEBT –Continued Subscription-Based Information Technology Arrangements Fracta AI-Based Condition Assessment Software On July 20, 2022, the District entered into a 36-month subscription for the use of Fracta AI-Based Condition Assessment Software.An initial subscription liability was recorded in the amount of $35,494. As of June 30, 2025, the value of the subscription liability is $0.The value of the right to use asset as of June 30, 2025 is $35,494 with accumulated amortization of $35,494 is included in note 4 with right to use assets. Samsara Networks, Inc. On July 5, 2022, the District entered into a 36-month subscription for the use of GPS fleet management system software.An initial subscription liability was recorded in the amount of $70,934. As of June 30, 2025, the value of the subscription liability is $0. The value of the right to use asset as of June 30, 2025 of $70,934 with accumulated amortization of $70,934 is included in note 4 with right to use assets. Tyler Software SAAS On January 1, 2024, the District entered into a 15-year subscription for the use of SaaS Services to access Tyler Software. An initial subscription liability was recorded in the amount of $5,270,119. As of June 30, 2025, the value of the subscription liability is $4,834,692. The District is required to make annual variable payments ranging from $168,779 to $467,260. The subscription has an interest rate of 1.39%. The value of the right to use asset as of June 30, 2025 is $5,270,119 with accumulated amortization of $527,012 is included in note 4 with right to use assets. Planet Bids On December 1, 2023, the District entered into a 30-month subscription for the use of Planet Bids software. An initial subscription liability was recorded in the amount of $61,870. As of June 30, 2025, the value of the subscription liability is $23,778. The District is required to make annual variable payments ranging from $15,331 to $24,109. The subscription has an interest rate of 1.39%. The value of the right to use asset as of June 30, 2025 is $61,870 with accumulated amortization of $32,997 is included in note 4 with right to use assets. Notes To Financial Statements Year Ended June 30, 2025 5)LONG-TERM DEBT –Continued Subscription-Based Information Technology Arrangements –Continued ESRI On June 26, 2023, the District entered into a 36-month subscription for the use of ESRI software. An initial subscription liability was recorded in the amount of $167,779. As of June 30, 2025, the value of the subscription liability is $55,923. The District is required to make annual fixed payments of $56,700. The subscription has an interest rate of 1.39%. The value of the right to use asset as of June 30, 2025 is $167,779 with accumulated amortization of $111,852 is included in note 4 with right to use assets. Future SBITA payable requirements are as follows: 6) NET POSITION Designations of Net Position In addition to the restricted net position, a portion of unrestricted net position has been designated by the Board of Directors for the following purposes as of June 30, 2025: For the Year Ended June 30,Principal Interest 2026 350,056$ 68,310$ 2027 274,113 63,444 2028 288,050 59,634 2029 302,485 55,630 2030 317,432 51,426 2031-2035 1,830,546 186,525 2036-2039 1,551,711 50,274 4,914,393$ 535,243$ 2025 Designated Betterment 350,588$ Replacement Reserve 38,015,690 Designated New Supply Fund 6,661 Undesignated 33,147,852 Total $ 71,520,791 Notes To Financial Statements Year Ended June 30, 2025 7)DEFINED BENEFIT PENSION PLAN A)General Information about the Pension Plans Plan Descriptions All qualified permanent and probationary employees are eligible to participate in the District’s Plan, agent multiple-employer defined benefit pension plans administered by the California Public Employees’ Retirement System (CalPERS), which acts as a common investment and administrative agent for its participating member employers. Benefit provisions under the Plans are established by State statute and District resolution. CalPERS issues publicly available reports that include a full description of the pension plans regarding provisions, assumptions and membership information that can be found on the CalPERS website. CalPERS provides service retirement and disability benefits, annual cost of living adjustments and death benefits to plan members, who must be public employees and beneficiaries. Benefits are based on years of credited service, equal to one year of full-time employment. Members with five years of total service are eligible to retire at age 50 (52 if new PERS member)with statutorily reduced benefits. All members are eligible for non-duty disability benefits after 10 years of service. The death benefit is one of the following: the Basic Death Benefit, the 1959 Survivor Benefit, or the Optional Settlement 2W Death Benefit. The cost-of-living adjustments for the plan are applied as specified by the Public Employees’ Retirement Law. Notes To Financial Statements Year Ended June 30, 2025 7) DEFINED BENEFIT PENSION PLAN –Continued Benefits Provided The Plans’ provisions and benefits in effect at June 30, 2025 are summarized as follows: Prior to On or After Hire Date January 1, 2013 January 1, 2013 Benefit Formula 2.7% at 55 2% at 62 Benefit Vesting Schedule 5 years’ service 5 years’ service Benefit Payments Monthly for life Monthly for life Retirement Age 50 –55+52 –67+ Monthly Benefits, as a % of Eligible Compensation 2.0% to 2.7%1.0% to 2.5% Required Employee Contribution Rates 2025 8.00%7.50% Required Employer Contribution Rates 2025 24.94%24.94% Employees Covered The following employees were covered by the benefit terms for the Plan: Inactive Employees or Beneficiaries Currently Receiving Benefits 227 Inactive Employees Entitled to But Not Yet Receiving Benefits 130 Active Employees 137 Total 494 Contributions Section 20814(c) of the California Public Employees’ Retirement Law requires that the employer contribution rates for all public employers be determined on an annual basis by the actuary and shall be effective on the July 1 following notice of a change in the rate. The total plan contributions for the Plan are determined through CalPERS’ annual actuarial valuation process. The actuarially determined rate is the estimated amount necessary to finance the costs of benefits earned by employees during the year, with an additional amount to finance any unfunded accrued liability. Notes To Financial Statements Year Ended June 30, 2025 7)DEFINED BENEFIT PENSION PLAN –Continued The employer is required to contribute the difference between the actuarially determined rate and the contribution rate of employees. Employer contribution rates may change if plan contracts are amended. B)Net Pension Liability The District’s net pension liability for the Plan is measured as the total pension liability, less the pension plan’s fiduciary net position. The net pension liability of the Plan is measured as of June 30, 2024 rolled forward to June 30, 2025 using standard update procedures. A summary of actuarial assumptions and methods used to determine the net pension liability is shown below: Actuarial Assumptions The total pension liabilities in the June 30, 2024 actuarial valuations were determined using the following actuarial assumptions: Actuarial Cost Method Entry-Age Actuarial Cost Method Actuarial Assumptions: Discount Rate 6.90% Inflation 2.30% Salaries Increases Varies by entry age and service Mortality Rate Table Derived using CalPERS membership data for all funds(1) Post Retirement Benefit Increase See Footnote(2) (1)The mortality table used was developed based on CalPERS-specific data. The probabilities of mortality are based on the 2021 CalPERS Experience Study and Review of Actuarial Assumptions. Mortality rates incorporate full generational mortality improvement using 80% of Scale MP-2020 published by the Society of Actuaries. For more details on this table, please refer to the 2021 experience study report from November 2021 that can be found on the CalPERS website. (2)The lesser of contract COLA or 2.30% until Purchasing Power Protection Allowance floor on purchasing power applies, 2.30% thereafter. Notes To Financial Statements Year Ended June 30, 2025 7)DEFINED BENEFIT PENSION PLAN –Continued Discount Rate The discount rate used to measure the total pension liability was 6.90%. The projection of cash flows used to determine the discount rate assumed that contributions from plan members will be made at the current member contribution rates and that contributions from employers will be made at statutorily required rates, actuarially determined. Based on those assumptions, the Plan’s fiduciary net position was projected to be available to make all projected future benefit payments of current plan members. Therefore, the long-term expected rate of return on plan investments was applied to all periods of projected benefit payments to determine the total pension liability. Long-term Expected Rate of Return The long-term expected rate of return on pension plan investments was determined using a building- block method in which future real rates of return (expected returns, net of pension plan investment expense and inflation) are developed for each major asset class. In determining the long-term expected rate of return, CalPERS took into account both short-term and long-term market return expectations. Using historical returns of all the funds’ asset classes, expected compound (geometric) returns were calculated over the next 20 years using a building block approach. The expected rate of return was then adjusted to account for assumed administrative expenses of 10 Basis points. The expected real rates of return by asset class are as follows: (a)An expected inflation of 2.30% used for this period. (b)Figures are based on the 2021 Asset Liability Management study. Assumed Asset Class(a)Asset Allocation Real Return(b) Global Equity - Cap-weighted 30.00%4.54% Global Equity - Non-Cap-weighted 12.00 3.84 Private Equity 13.00 7.28 Treasury 5.00 0.27 Mortgage-backed Securities 5.00 0.50 Investment Grade Corporates 10.00 1.56 High Yield 5.00 2.27 Emerging Market Debt 5.00 2.48 Private Debt 5.00 3.57 Real Assets 15.00 3.21 Leverage (5.00) (0.59) Notes To Financial Statements Year Ended June 30, 2025 7)DEFINED BENEFIT PENSION PLAN –Continued C)Changes in the Net Pension Liability (Asset) The changes in the Net Pension Liability (Asset) for the Plan for the year ending June 30, 2025: Total Pension Plan Fiduciary Net Pension Liability Net Position Liability (Asset) Beginning Balance 174,580,366$146,026,421$ 28,553,945$ Changes in the Year: Service Cost 3,111,192 - 3,111,192 Interest on the Total Pension Liability 11,829,614 - 11,829,614 Difference Between Expected and Actual Experience (58,875) - (58,875) Net Plan to Plan Resource Movement - - - Contributions - Employer 3,156,662 (3,156,662) Contributions - Employees 1,203,583 (1,203,583) Net Investment Income 13,765,459 (13,765,459) Benefit Payments, Including Refunds of Employee Contributions (9,266,810) (9,266,810) - Administrative Expense - (118,822) 118,822 Net Changes 5,615,121 8,740,072 (3,124,951) Ending Balance 180,195,487$154,766,493$ 25,428,994$ Increase ( Decrease) Notes To Financial Statements Year Ended June 30, 2025 7)DEFINED BENEFIT PENSION PLAN –Continued Sensitivity of the Net Pension Liability to Changes in the Discount Rate The following presents the net pension liability of the District for the Plan, calculated using the discount rate for the Plan, as well as what the District’s net pension liability would be if it were calculated using a discount rate that is 1-percentage point lower or 1-percentage point higher than the current rate: Pension Plan Fiduciary Net Position Detailed information about the pension plan’s fiduciary net position is available in the separately issued CalPERS financial reports. D) Pension Expenses and Deferred Outflows/Inflows of Resources Related to Pensions For the year ended June 30, 2025, the District recognized pension expense of $6,903,416.At June 30, 2025, the District reported deferred outflows of resources and deferred inflows of resources related to pensions from the following services: 2025 1% Decrease 5.90% Net Pension Liability 47,764,034$ Current Discount Rate 6.90% Net Pension Liability 25,428,994$ 1% Increase 7.90% Net Pension Liability/(Asset)6,761,301$ Deferred Outflows Deferred Inflows of Resources of Resources Pension contributions subsequent to measurement date 3,891,166$ -$ Differences between actual and expected experience 883,663 (37,848) Net difference between projected and actual earnings on pension plan investments 2,405,434 - Total 7,180,263$ (37,848)$ Notes To Financial Statements Year Ended June 30, 2025 7)DEFINED BENEFIT PENSION PLAN –Continued D)Pension Expenses and Deferred Outflows/Inflows of Resources Related to Pensions -Continued $3,891,166 reported as deferred outflows of resources related to contributions subsequent to the measurement date will be recognized as a reduction of the net pension liability in the fiscal year ended June 30, 2026. Other amounts reported as deferred outflows of resources and deferred inflows of resources related to pensions will be recognized as pension expense as follows: Gains and losses related to changes in total pension liability and fiduciary net position are recognized in pension expense systematically over time. The first amortized amounts are recognized in pension expense for the year the gain or loss occurs. The remaining amounts are categorized as deferred outflows and deferred inflows of resources related to pensions and are to be recognized in future pension expense.The amortization period differs depending on the source of the gain or loss: Net difference between projected and actual earnings on pension plan investments 5-year straight-line amortization All other amounts Straight-line amortization over the expected average remaining service lifetime (EARSL) of all members that are provided with benefits (active, inactive, and retired) as of the beginning of the measurement period Fiscal Deferred Year Ended Outflow/(Inflows) June 30 of Resources 2026 780,150$ 2027 3,827,111 2028 (582,687) 2029 (773,325) 2030 - Thereafter - Notes To Financial Statements Year Ended June 30, 2025 7)DEFINED BENEFIT PENSION PLAN –Continued E)Payable to the Pension Plan At June 30, 2025, the District reported a payable of $179,091 for the outstanding amount of contributions to the pension plan required for the year ended June 30, 2025. These payables are reflected in the accrued payroll liabilities on the Statement of Net Position. F)Subsequent Events There were no subsequent events that would materially affect the results presented in this disclosure. 8)OTHER POST EMPLOYMENT BENEFITS (OPEB) Plan Description The District’s defined benefit postemployment healthcare plan, (DPHP), provides medical benefits to eligible retired District employees and beneficiaries. DPHP is part of the Public Agency portion of the California Employers’ Retiree Benefit Trust Fund (CERBT), an agent multiple-employer plan administered by California Public Employees’ Retirement System (CalPERS), which acts as a common investment and administrative agent for participating public employers within the State of California. CalPERS issues a separate Annual Comprehensive Financial Report. Copies of the CalPERS’ annual financial report may be obtained from the CalPERS Executive Office, 400 P Street, Sacramento, California 95814. Prior to the plan agreements signed in 2011, the eligibility in the plan was broken into three tiers, employees hired before January 1, 1981, employees hired on or after January 1, 1981 but before July 1, 1993 and employees hired on or after July 1, 1993. Board members elected before January 1, 1995 are also eligible for the plan. Eligibility also includes age and years of service requirements which vary by tier. Benefits include up to 100% medical and/or dental premiums for life for the retiree for Tier I or II employees, and up to 100% spouse premium until death of retiree or age 65 whichever is greater and dependent premium up to age 19.Tier III employees received up to 50% medical (no dental coverage) up to age 65 and did not include dependent coverage. Subsequent to the agreements in 2011 and 2012 all employees are eligible for the plan after 20 years of consecutive service and unrepresented employees hired before January 1, 2013 are eligible after 15 years. Survivor benefits are covered beyond Medicare. Notes To Financial Statements Year Ended June 30, 2025 8)OTHER POST EMPLOYMENT BENEFITS (OPEB) -Continued Employees Covered As of June 30, 2024 actuarial valuation, the following current and former employees were covered by the benefit terms under the Plan: Contributions The annual contribution is based on the actuarially determined contribution. For the fiscal year ended June 30, 2025, the District made cash contributions to the trust of $2,537,706 and had an estimated implied subsidy of $235,798, resulting in total payments of $2,773,504. Net OPEB Liability The District’s net OPEB liability was measured as of June 30, 2024 and the total OPEB liability used to calculate the net OPEB liability was determined by actuarial valuations dated June 30, 2024 based on the following actuarial methods and assumptions: Actuarial Assumptions Discount Rate 6.75% Inflation 2.50% Salary Increases 2.75% Investment Rate of Return 6.75% Mortality Rate(1)Derived using CalPERS Membership Data for all funds Pre-Retirement Turnover(2)Derived using CalPERS Membership Data for all funds Healthcare Trend Rate 4.50% PPO Notes: (1)The mortality assumptions are based on the 2021 CalPERS Mortality for Miscellaneous and Schools Employees table created by CalPERS. CalPERS periodically studies mortality for participating agencies and established mortality tables that are modified versions of commonly used tables. This table incorporates mortality projection as deemed appropriate based on CalPERS analysis. (2)The retirement assumptions are based on the 2021 CalPERS 2.0%@62 and 2.7%@55. Rates for Miscellaneous Employees tables created by CalPERS. CalPERS periodically studies the experience for participating agencies and establishes tables that are appropriate for each pool. Active Employees 78 Inactive Employees or Beneficiaries Currently Receiving Benefits 85 Inactive Employees Entitled to But Not Yet Received Benefits - Total 163 Notes To Financial Statements Year Ended June 30, 2025 8)OTHER POST EMPLOYMENT BENEFITS (OPEB) -Continued Net OPEB Liability (Continued) The long-term expected rate of return on OPEB plan investments was determined using a building block method in which best-estimate ranges of expected future real rates of return (expected returns, net of OPEB plan investment expense and inflation) are developed for each major asset class. These ranges are combined to produce the long-term expected rate of return by weighting the expected future real rates of return by the target asset allocation percentage and by adding expected inflation. Best estimates of arithmetic real rates of return for each major asset class included in the OPEB plan’s target asset are summarized in the following table for the June 30, 2024 actuarial valuation: Discount Rate The discount rate used to measure the total OPEB liability was 6.75% for the June 30, 2024 measurement period. The projection of cash flows used to determine the discount rate assumed that District contributions will be made at rates equal to the actuarially determined contribution rates. Based on those assumptions, the OPEB plan’s fiduciary net position was projected to be available to make all projected OPEB payments for current active and inactive employees and beneficiaries. Therefore, the long-term expected rate of return on OPEB plan investments was applied to all periods of projected benefit payments to determine the total OPEB liability. Percentage Assumed Asset Class of Portfolio Gross Return All Equities 49.00%7.25% All Fixed Income 23.00%4.25% Real Estate Investment Trust 20.00%7.25% All Commodities 3.00%7.25% Treasury Inflation Protected Securities (TIPS)5.00%3.00% Notes To Financial Statements Year Ended June 30, 2025 8)OTHER POST EMPLOYMENT BENEFITS (OPEB) -Continued Changes in the OPEB Liability (Asset) The changes in the net OPEB liability (asset) for the Plan for the year ending June 30, 2025: Sensitivity of the Net OPEB Liability (Asset) to Changes in the Discount Rate The following presents the net OPEB liability (asset) of the District if it were calculated using a discount rate that is one percentage point lower or one percentage point higher than the current rate, for the measurement period ended June 30, 2024: Total OPEB Plan Fiduciary Net OPEB Liability Net Position Liability (Asset) Beginning Balance 42,648,870$ 31,446,524$ 11,202,346$ Changes in the year: Service Cost 1,310,461 - 1,310,461 Interest on TOL/Return on FNP 2,867,289 3,532,940 (665,651) Difference Between Expected and Actual Experience (3,292,876) - (3,292,876) Changes in Benefit Terms (3,464,001) - (3,464,001) Contributions - Employer - 2,775,728 (2,775,728) Benefit Payments (1,637,067) (1,637,067) - Administrative Expenses - (10,423) 10,423 Net Changes (4,216,194) 4,661,178 (8,877,372) Ending Balance 38,432,676$ 36,107,702$ 2,324,974$ Increase ( Decrease) Current 1% Decrease Discount Rate 1% Increase 5.75%6.75%7.75% 2025 Net OPEB Liability (Asset) (2024 Measurement Date)7,082,330$ 2,324,974$ (1,639,180)$ Notes To Financial Statements Year Ended June 30, 2025 8)OTHER POST EMPLOYMENT BENEFITS (OPEB) -Continued Sensitivity of the Net OPEB Liability (Asset) to Changes in the Healthcare Cost Trend Rates The following presents the net OPEB liability of the District if it were calculated using health care cost trend rates that are one percentage point lower or one percentage point higher than the current rate, for measurement period ended June 30, 2024: OPEB Plan Fiduciary Net Position CERBT issues a publicly available financial report that may be obtained from the California Public Employees Retirement System Executive Office, 400 P Street, Sacramento, California 95814. Recognition of Deferred Outflows and Deferred Inflows of Resources Gains and losses related to changes in total OPEB liability and fiduciary net position are recognized in OPEB expense systematically over time. Amounts are first recognized in OPEB expense for the year the gain or loss occurs. The remaining amounts are categorized as deferred outflows and deferred inflows of resources related to OPEB and are to be recognized in future OPEB expense. The recognition period differs depending on the source of the gain or loss: Net difference between projected and actual earnings on OPEB plan investments 5 years All other amounts Expected average remaining service lifetime (EARSL) Current Healthcare Cost 1% Decrease Trend Rates 1% Increase 2025 Net OPEB Liability (Asset) (2024 Measurement Date)(2,150,733)$ 2,324,974$ 7,771,156$ Notes To Financial Statements Year Ended June 30, 2025 8)OTHER POST EMPLOYMENT BENEFITS (OPEB) -Continued OPEB Expense and Deferred Outflows/Inflows of Resources Related to OPEB For the fiscal year ended June 30, 2025, the District recognized OPEB expense (income)of ($2,408,150). As of the fiscal year ended June 30, 2025, the District reported deferred outflows and inflows of resources related to OPEB from the following sources: $2,773,504 reported as deferred outflows of resources related to contributions subsequent to the measurement date will be recognized as a reduction of the net OPEB liability in the fiscal year ended June 30, 2026. Other amounts reported as deferred outflows of resources and deferred inflows of resources related to pensions will be recognized as pension expense as follows: Effective September 1, 2024, the District created a Health Reimbursement Arrangement (HRA)plan (a defined contribution plan) and closed the District’s current OPEB plan. Employees hired on or after September 1, 2024 are no longer eligible to enter the District’s OPEB plan. However,they are required to join the HRA plan. Employees hired prior to September 1,2024 had the option to remain in the current OPEB plan or opt in to the HRA plan. Deferred Outflows Deferred Inflows of Resources of Resources OPEB contributions subsequent to measurement date 2,773,504$ -$ Differences between expected and actual experience 5,911,486 (2,606,860) Changes in assumptions 29,480 (641,254) Net difference between projected and actual earnings on OPEB plan investments 565,903 - Total 9,280,373$ (3,248,114)$ Fiscal Deferred Year Ended Outflows/(Inflows) June 30, of Resources 2026 453,097$ 2027 1,639,271 2028 190,027 2029 49,413 2030 842,683 Thereafter 84,264 Notes To Financial Statements Year Ended June 30, 2025 9) OTHER NON-CURRENT LIABILITIES Other non-current liabilities for the year ended June 30, 2025, are as follows: * Compensated absences as of June 30, 2024 were restated as a result of the implementation of Governmental Accounting Standards Board (GASB) Statement No. 101 Compensated Absences. 10) COMMITMENTS AND CONTINGENCIES Construction Commitments The District has commitments related to capital projects under construction with an estimated cost to complete of $19,009,944 at June 30, 2025. Litigation Certain claims, suits, and complaints arising in the ordinary course of operation have been filed or are pending against the District. In the opinion of the staff and counsel, most of those matters are adequately covered by insurance, or if not so covered,are without merit or are of such kind, or involved such amounts, as would not have significant effect on the financial position or results of operations of the District if disposed of unfavorably. There is one case, see below, that could have a significant effect on the District’s financial position. In November 2015, a District ratepayer filed a class-action lawsuit against the District (Coziahr v. Otay Water District, Superior Court of the State of California, County of San Diego), contending that the District’s tiered residential water rates from mid-2014 through 2022 violated Article XIIID of the California Constitution (“Proposition 218”) . On March 4, 2021, the court issued a decision in favor of the plaintiffs, holding that Otay’s tiered water rates adopted in 2013 and 2017 were not proportionate to the cost of service attributable to each customer’s parcel, as required by Proposition 218. Beginning Ending Due Within Balance Additions Deletions Balance One Year Compensated absences *3,486,190$ 1,887,312$ (1,568,719)$ 3,804,783$ 380,478$ Customer credits 264,156 4,176 - 268,332 - Reimbursement agreements 356,644 - - 356,644 - Total 4,106,990$ 1,891,488$ (1,568,719)$ 4,429,759$ 380,478$ Notes To Financial Statements Year Ended June 30, 2025 10) COMMITMENTS AND CONTINGENCIES -Continued On June 15, 2022, the court issued a Statement of Decision in the case. Applying and adjusting plaintiffs’ calculations, the court ordered refunds to ratepayers through June 2021 in the amount of $18,105,256, plus approximately $208,762 plus interest each month from June 2021 until the District changed its rates to be consistent with Proposition 218. The District appealed the decision to the Court of Appeal, and changed its rates effective January 2023. The estimated potential liability to the District, if the court were to have awarded the attorneys fees and damages based on the trial court’s decision, may have been as high as $27M, which the District accrued in its financial statements for the fiscal year ending June 30, 2024. The Court of Appeal upheld the trial court’s determination that a refund was owed, but the amount was found to be calculated in error and the case was remanded to the trial court for further proceedings. On October 28, 2025, the District entered into a tentative settlement agreement with the plaintiff in the amount of $12M. The agreement is anticipated to be submitted for court approval in November 2025. The District anticipates receiving court approval by the end of calendar year 2025. The District has fully accrued for the tentative settlement amount in its audited financial statements for the fiscal year ending June 30, 2025. Refundable Terminal Storage Fees The District has entered into an agreement with several developers whereby the developers prepaid the terminal storage fee in order to provide the District with the funds necessary to build additional storage capacity. The agreement further allows the developers to relinquish all or a portion of such water storage capacity. If the District grants to another property owner the relinquished storage capacity, the District shall refund to the applicable developer $746 per equivalent dwelling unit (EDU). There were 17,867 EDUs that were subject to this agreement. At June 30, 2025, 1,750 EDUs had been relinquished and refunded, 15,105 EDUs had been connected, and 1,012 EDUs have neither been relinquished nor connected. Notes To Financial Statements Year Ended June 30, 2025 10)COMMITMENTS AND CONTINGENCIES –Continued Developer Agreements The District has entered into various Developer Agreements with developers towards the expansion of District facilities. The developers agree to make certain improvements and after the completion of the projects,the District agrees to reimburse such improvements with a maximum reimbursement amount for each developer. Contractually, the District does not incur a liability for the work until the work is accepted by the District. As of June 30, 2025, none of the outstanding developer projects had been completed. It is anticipated that the District will be liable for an amount not to exceed $1,725,000 at the point of acceptance. Accordingly, the District has accrued this amount as of year-end. 11)RISK MANAGEMENT General Liability and Property The District is exposed to various risks of loss related to torts, theft, damage and destruction of assets, errors and omissions, and natural disasters. The District is a member in an insurance pool through the Association of California Water Agencies Joint Powers Insurance Authority (ACWA JPIA). ACWA JPIA is a not-for-profit public agency formed under California Government Code Sections 6500 et. Seq. ACWA JPIA is governed by a board composed of members from participating agencies. The District pays an annual premium for commercial insurance covering general liability, excess liability, property, automobile, public employee dishonesty, and various other claims. Separate financial statements of ACWA JPIA may be obtained at ACWA JPIA 2100 Professional Drive, Roseville, CA 95661-3700. General and Auto Liability, Public Officials’ Errors and Omissions and Employment Practices Liability: JPIA pools for the first $5 million and purchases excess coverage up to $55 million. No deductible for losses arising out of liability or imposed by law or assumed by contract. Notes To Financial Statements Year Ended June 30, 2025 11)RISK MANAGEMENT –Continued Excess Crime Coverage: Total of $1 million per loss includes Public Employee Dishonesty, Forgery or Alteration,Computer Fraud, Faithful Performance of Duty and Impersonation Fraud subject to $1,000 deductible effective July 1, 2024. Property Loss: Replacement cost up to scheduled value total of $372 million with program aggregates up to $150 million, subject to $25,000 basic deductible (5% total insured value for earthquake, $100,000 for flood) effective July 1, 2024. Boiler and Machinery: Replacement costs up to $100 million per occurrence, subject to a $25,000 deductible, $50,000 for turbine or power generation equipment) effective July 1, 2024. Comprehensive and Collision: For scheduled vehicles and mobile equipment, subject to $1,000 deductible effective July 1, 2024. Workers’ Compensation Coverage and Employer’s Liability: Statutory limits per occurrence for Workers’ Compensation and $2.0 million for Employer’s Liability Coverage, subject to the terms, conditions and exclusions as provided in the Memorandum of Coverage, effective July 1, 2024. Cyber Coverage: $5 million Annual Program-Wide Aggregate Limit of Liability and $3 million maximum for each Insured/Member for Information Security & Privacy Liability subject to $100,000 deductible. Fiduciary Coverage: Otay Water District Deferred Compensation Plan $2 million aggregate limit of liability, per incident limits of $1.5 million for HIPPA/HITECH fines and $250,000 for all else. Retention: $10,000 each claim and $50,000 per claim due to Class Action and Derivative Claims During the past three fiscal years, none of the above programs of protection experienced settlements or judgments that exceeded pooled or insured covered. There were also no significant reductions in pooled or insured liability coverage in fiscal year 2024-25. 12) LEASES RECEIVABLE The District has entered into 30 cell site leases with lease terms ranging from less than one year to sixty years. The lessees are required to make annual fixed payments ranging from $29,532 to $60,503, with discount rates of 1.39%. As of June 30,2025, the lease receivable is $50,369,933 and deferred inflows of resources is $46,429,877. The District recognized $2,083,057 of lease revenue during the fiscal year. Notes To Financial Statements Year Ended June 30, 2025 13)RESTATEMENT During the year ended June 30, 2025, the District adopted new accounting guidance by implementing the provisions of GASB 101. As a result of this implementation, additional compensated absences resulted from the addition of payroll-related taxes and benefits associated with the accrued leave. The following summarizes the net effects on beginning net position: 14)SEGMENT INFORMATION The District has issued Water and Wastewater Revenue Bonds in the previous fiscal years to finance certain capital improvements. While water and wastewater services are accounted for jointly in these financial statements, the investors in the Water Revenue Bonds rely solely on the revenues of the water services for repayment and the Wastewater Revenue Bonds solely on the revenues of the wastewater services for repayment. Summary of financial information for the water and wastewater services is presented for June 30, 2025 on the following pages: Total Net Position, Beginning, as Previously Reported 404,274,141$ Restatement for Implementation of GASB 101 (233,092) Total Net Position, Beginning, as Restated 404,041,049$ Notes To Financial Statements Year Ended June 30, 2025 14)SEGMENT INFORMATION –Continued Water Wastewater Services Services Total Assets Cash and Investments 95,223,198$ 8,933,769$ 104,156,967$ Accounts Receivable, Net 18,693,448 225,230 18,918,678 Other Current Assets 13,926,691 125,892 14,052,583 Leases Receivable 50,369,933 - 50,369,933 Capital Assets 420,858,927 26,409,581 447,268,508 Total Assets 599,072,197 35,694,472 634,766,669 Deferred Outflows of Resources Deferred Actuarial Pension Costs 6,944,979 235,284 7,180,263 Deferred Actuarial OPEB Costs 8,870,720 409,653 9,280,373 Total Deferred Outflows of Resources 15,815,699 644,937 16,460,636 Liabilities Accounts Payable 17,138,271 379,624 17,517,895 Accrued Liability 12,000,000 - 12,000,000 Other Miscellaneous Liabilities 6,931,553 1,470,389 8,401,942 Other Current Liabilities 11,813,113 107,636 11,920,749 Revenue Bonds 81,639,186 2,744,317 84,383,503 Lease Payable 651,289 - 651,289 Subscription-Based IT Payable 4,564,337 - 4,564,337 Net Pension Liability 24,594,827 834,167 25,428,994 Net OPEB Liability 2,182,633 142,341 2,324,974 Other Non-current Liabilities 4,049,281 - 4,049,281 Total Liabilities 165,564,490 5,678,474 171,242,964 Deferred Inflows of Resources Deferred Actuarial OPEB Costs 3,131,294 116,820 3,248,114 Deferred Actuarial Pension Costs 36,410 1,438 37,848 Deferred Inflows from Leases 46,429,877 - 46,429,877 Total Deferred Inflows of Resources 49,597,581 118,258 49,715,839 Net Position Net Investment in Capital Assets 328,197,438 23,585,725 351,783,163 Restricted for Debt Service 3,826,616 - 3,826,616 Restricted for Capital Assets 3,137,932 - 3,137,932 Unrestricted 64,563,839 6,956,952 71,520,791 Total Net Position 399,725,825$ 30,542,677$ 430,268,502$ June 30, 2025 Condensed Statement of Net Position Notes To Financial Statements Year Ended June 30, 2025 14)SEGMENT INFORMATION –Continued Water Wastewater Services Services Total Operating Revenues Water Sales 121,483,491$ -$ 121,483,491$ Wastewater Revenue - 3,500,945 3,500,945 Connection and Other Fees 3,764,046 38,157 3,802,203 Total Operating Revenues 125,247,537 3,539,102 128,786,639 Operating Expenses Cost of Water Sales 89,595,836 - 89,595,836 Wastewater - 2,578,457 2,578,457 Administrative and General 33,449,222 - 33,449,222 Depreciation 17,362,542 1,054,632 18,417,174 Total Operating Expenses 140,407,600 3,633,089 144,040,689 Operating Income (Loss)(15,160,063) (93,987) (15,254,050) Non-Operating Revenues (Expenses) Investment Earnings (Losses)5,811,145 187,792 5,998,937 Taxes and Assessments 6,171,087 - 6,171,087 Availability Charges 665,683 51,508 717,191 Gain (Loss) on Sale of Capital Assets (228,041) - (228,041) Rents and Leases 2,083,057 - 2,083,057 Miscellaneous Revenues 17,097,575 - 17,097,575 Donations (97,105) - (97,105) Interest Expense (3,969,268) (85,025) (4,054,293) Miscellaneous Expenses (382,042) (12,493) (394,535) Total Non-operating Revenues (Expenses)27,152,091 141,782 27,293,873 Income (Loss) Before Capital Contributions and Transfers 11,992,028 47,795 12,039,823 Capital Contributions 13,885,347 302,283 14,187,630 Change in Net Position 25,877,375 350,078 26,227,453 Total Net Position, Beginning, as Previously Reported 374,081,542 30,192,599 404,274,141 Restatement (Note 13)(233,092) - (233,092) Total Net Position, Beginning, as Restated 373,848,450 30,192,599 404,041,049 Total Net Position, Ending 399,725,825$ 30,542,677$ 430,268,502$ Condensed Statement of Revenues, Expenses and Changes in Net Pension Year Ended June 30, 2025 Notes To Financial Statements Year Ended June 30, 2025 14)SEGMENT INFORMATION –Continued Cash and Cash Equivalents consist of the following: Water Wastewater Services Services Total Net Cash Provided/(Used) by: Operating Activities (7,919,593)$ 1,700,214$ (6,219,379)$ Non-capital and Related Financing Activities 6,797,316 51,508 6,848,824 Capital and Related Financing Activities (21,584,698) (137,741) (21,722,439) Investing Activities 17,715,533 187,792 17,903,325 Net Increase(Decrease) in Cash and Cash Equivalents (4,991,442) 1,801,773 (3,189,669) Cash and Cash Equivalents, Beginning 73,264,995 7,131,996 80,396,991 Cash and Cash Equivalents, Ending 68,273,553$ 8,933,769$ 77,207,322$ For the Year Ended June 30, 2025 Condensed Statement of Cash Flows Cash and Cash Equivalents 70,242,774$ Restricted Cash and Cash Equivalents 6,964,548 Total Cash and Investments 77,207,322$ This page intentionally left blank Schedule of Changes in the Net OPEB Liability and Related Ratios Last Ten Years (1) June 30, 2025 Measurement Period: June 30 2024 2023 2022 2021 Total OPEB Liability Service Cost 1,310,461$ 1,018,363$ 991,108$ 755,756$ Interest on the Total OPEB Liability 2,867,289 2,324,644 2,189,619 2,077,446 Actual and Expected Experience Difference (3,292,876) 5,942,003 254,888 2,595,855 Changes in Assumptions - 41,042 - (1,557,334) Changes in Benefit Terms (3,464,001) - - - Benefit Payment (1,637,067) (1,214,348) (1,428,491) (1,201,678) Net Change in Total OPEB Liability (4,216,194) 8,111,704 2,007,124 2,670,045 Total OPEB Liability - Beginning 42,648,870 34,537,166 32,530,042 29,859,997 Total OPEB Liability - Ending (a)38,432,676$ 42,648,870$ 34,537,166$ 32,530,042$ Plan Fiduciary Net Position Contributions - Employer 2,775,728$ 1,214,348$ 127,444$ 807,867$ Net Investment Income 3,532,940 1,969,238 (4,739,093) 7,880,863 Benefit Payments (1,637,067) (1,214,348) (1,428,491) (1,201,678) Administrative Expenses (10,423) (8,619) (9,034) (10,811) Other Expenses - - - - Net Change in Plan Fiduciary Net Position 4,661,178 1,960,619 (6,049,174) 7,476,241 Plan Fiduciary Net Position - Beginning 31,446,524 29,485,905 35,535,079 28,058,838 Plan Fiduciary Net Position - Ending (b)36,107,702 31,446,524 29,485,905 35,535,079 Net OPEB Liability/(Asset) - Ending (a)-(b)2,324,974$ 11,202,346$ 5,051,261$ (3,005,037)$ Plan Fiduciary Net Position as a Percentage of the Total OPEB Liability 93.95%73.73%85.37%109.24% Covered-Employee Payroll 14,757,192$ 14,393,757$ 14,054,264$ 14,006,918$ Net OPEB Liability/(Asset) as a Percentage of Covered-Employee Payroll 15.75%77.83%35.94%-21.45% Notes to Schedule (1)Historical information is required only for measurement periods for which GASB 75 is applicable.Future years’information will be displayed up to 10 years as information becomes available.Contributions are determined by an actuarial valuation based on eligible participants’ estimated medical and dental benefits. Schedule of Changes in the Net OPEB Liability and Related Ratios Last Ten Years (1) June 30, 2025 Measurement Period: June 30 2020 2019 2018 2017 Total OPEB Liability Service Cost 735,529$ 757,725$ 735,655$ 687,528$ Interest on the Total OPEB Liability 1,915,358 1,970,613 1,864,967 1,764,343 Actual and Expected Experience Difference 1,151,927 (2,029,118) - - Changes in Assumptions - (345,110) - - Changes in Benefit Terms - - - - Benefit Payment (1,120,146) (1,141,344) (1,085,586) (1,039,420) Net Change in Total OPEB Liability 2,682,668 (787,234) 1,515,036 1,412,451 Total OPEB Liability - Beginning 27,177,329 27,964,563 26,449,527 25,037,076 Total OPEB Liability - Ending (a)29,859,997$ 27,177,329$ 27,964,563$ 26,449,527$ Plan Fiduciary Net Position Contributions - Employer 1,011,358$ 2,206,363$ 2,202,004$ 2,284,420$ Net Investment Income 983,790 1,595,092 1,734,626 2,011,985 Benefit Payments (1,120,146) (1,141,344) (1,085,586) (1,039,420) Administrative Expenses (13,514) (12,299) (11,784) (10,167) Other Expenses - - - - Net Change in Plan Fiduciary Net Position 861,488 2,647,812 2,839,260 3,246,818 Plan Fiduciary Net Position - Beginning 27,197,350 24,549,538 21,739,035 18,492,217 Plan Fiduciary Net Position - Ending (b)28,058,838 27,197,350 24,578,295 21,739,035$ Net OPEB Liability/(Asset) - Ending (a)-(b)1,801,159$ (20,021)$ 3,386,268$ 4,710,492$ Plan Fiduciary Net Position as a Percentage of the Total OPEB Liability 94.00%100.10%87.80%82.20% Covered-Employee Payroll 13,538,959$ 13,176,602$ 12,677,000$ 12,513,000$ Net OPEB Liability/(Asset) as a Percentage of Covered-Employee Payroll 13.30%-0.20%26.90%37.60% Notes to Schedule (1)Historical information is required only for measurement periods for which GASB 75 is applicable.Future years’information will be displayed up to 10 years as information becomes available.Contributions are determined by an actuarial valuation based on eligible participants’ estimated medical and dental Schedule of Contributions Last Ten Years (1) June 30, 2025 Actuarially Determined Contributions in Contribution Contributions as a Fiscal Contribution Relation to the Deficiency Covered-Percentage of Covered- Year (ADC)ADC (Excess)Payroll Payroll 2018 1,116,418$ (2,202,004)$ (1,085,586)$ 12,677,000$ 17.37% 2019 1,149,911 (2,206,363) (1,056,452) 13,176,602 16.74% 2020 1,011,358 (1,011,358) - 13,538,959 7.47% 2021 807,867 (807,867) - 14,006,918 5.77% 2022 127,444 (127,444) - 14,054,264 0.91% 2023 1,214,348 (1,214,348) - 14,393,757 8.44% 2024 2,775,728 (2,775,728) - 14,757,192 18.81% 2025 2,773,504 (2,773,504) - 15,982,606 17.35% Notes to Schedule: Methods and assumptions used to determine contributions: Actuarial Cost Method Entry Age Actuarial Cost Method Amortization Method/Period Level percent of payroll over a closed rolling 15-year period Asset Valuation Method Fair value Inflation 2.50% Payroll Growth 2.75% Investment Rate of Return 6.75% Healthcare Cost-trend Rates 4.50% HMO/4.50% PPO Retirement Age Mortality The actuarial methods and assumptions used to set the actuarially determined contributions for Fiscal Year 2025 were from the June 30,2024 actuarial valuation.Also note,that some of the data from prior years were updated with the most current available information. Tier 1 employees -2.7%at 55 and Tier 2 employees -2.0%at 62.The probabilities of Retirement are based on the 2021 CalPERS Experience Study. The mortality assumptions are based on the 2021 CalPERS Mortality for Miscellaneous and Schools Employees table created by CalPERS. (1)Historical information is required only for measurement periods for which GASB 75 is applicable.Future years’ information will be displayed up to 10 years as information becomes available.Contributions are determined by an actuarial valuation based on eligible participants’ medical and dental benefits. Schedule of Changes in the Net Pension Liability and Related Ratios Last Ten Years June 30, 2025 Measurement Period: June 30 2024 2023 2022 2021 2020 Total Pension Liability Service Cost 3,111,192$ 2,989,611$ 2,994,291$ 2,662,845$ 2,623,208$ Interest 11,829,614 11,457,149 10,864,205 10,489,284 10,043,778 Changes in Benefit Terms - 137,177 - - - Changes in Assumptions - - 4,984,447 - - Difference Between Expected and actual Experience (58,875) 3,092,819 174,717 705,426 260,337 Benefit Payments, including Refunds of Employee Contributions (9,266,810) (8,834,436) (8,151,116) (7,304,947) (7,017,816) Net Change in Total Pension Liability 5,615,121 8,842,320 10,866,544 6,552,608 5,909,507 Total Pension Liability - Beginning 174,580,366 165,738,046 154,871,502 148,318,894 142,409,387 Total Pension Liability - Ending (a)180,195,487$ 174,580,366$ 165,738,046$ 154,871,502$ 148,318,894$ Plan Fiduciary Net Position Net Plan to Plan Resource Movement -$ -$ -$ -$ -$ Contributions - Employer 3,156,662 5,458,992 3,928,187 3,945,147 2,437,119 Contributions - Employee 1,203,583 1,112,562 1,099,592 1,095,898 1,055,769 Net Investment Income 13,765,459 8,605,145 (11,584,615) 28,707,870 6,185,108 Benefit Payments, Including Refunds of Employee Contributions (9,266,810) (8,834,436) (8,151,116) (7,304,947) (7,017,816) Administrative Expenses (118,822) (102,793) (96,301) (128,139) (177,337) Other Changes in Fiduciary Net Position - - - - - Net Change in Plan Fiduciary Net Position 8,740,072 6,239,470 (14,804,253) 26,315,829 2,482,843 Plan Fiduciary Net Position - Beginning 146,026,421 139,786,951 154,591,204 128,275,375 125,792,532 Plan Fiduciary Net Position - Ending (b)154,766,493 146,026,421 139,786,951 154,591,204 128,275,375 Plan Net Pension Liability/(Asset) - Ending (a)-(b)25,428,994$ 28,553,945$ 25,951,095$ 280,298$ 20,043,519$ Plan Fiduciary Net Position as a Percentage of the Total Pension Liability 85.89%83.64%84.34%99.82%86.49% Covered Payroll 14,893,185$ 14,539,529$ 14,148,052$ 13,768,586$ 13,383,715$ Plan Net Pension Liability/(Asset) as a Percentage of Covered Payroll 170.74%196.39%183.43%2.04%149.76% Notes to Schedule: Changes in Benefit Terms:The figures above generally include any liability impact that may have resulted from voluntary benefit changes that occurred on or before the Measurement Date.However,offers of Two Years Additional Service Credit (a.k.a.Golden Handshakes)that occurred after the Valuation Date are not included in the figures above,unless the liability impact is deemed to be material by the plan actuary. Changes in Assumptions:There were no assumption changes in 2023 or 2024.Effective with the June 30,2021 valuation date (June 30, 2022 measurement date),the accounting discount rate was reduced from 7.15%to 6.90%.In determining the long-term expected rate of return,CalPERS took into account long-term market return expectations as well as the expected pension fund cash flows.In addition, demographic assumptions and the price inflation assumption were changed in accordance with the 2021 CalPERS Experience Study and Review of Actuarial Assumptions.The accounting discount rate was 7.15%for measurement date June 30,2017 through June 30,2021,and 7.65% for measurement dates June 30, 2015 through June 30, 2016. Schedule of Changes in the Net Pension Liability and Related Ratios Last Ten Years June 30, 2025 Measurement Period: June 30 2019 2018 2017 2016 2015 Total Pension Liability Service Cost 2,586,911$ 2,528,271$ 2,556,902$ 2,298,617$ 2,250,860$ Interest 9,638,674 9,168,092 8,836,284 8,575,275 8,229,312 Changes in Benefit Terms - - - - - Changes in Assumptions - (1,312,634) 7,308,486 - (1,996,819) Difference Between Expected and actual Experience 1,183,213 461,917 (1,208,593) (613,440) (981,200) Benefit Payments, including Refunds of Employee Contributions (6,658,719) (5,995,949) (5,779,040) (5,448,218) (5,288,251) Net Change in Total Pension Liability 6,750,079 4,849,697 11,714,039 4,812,234 2,213,902 Total Pension Liability - Beginning 135,659,308 130,809,611 119,095,572 114,283,338 112,069,436 Total Pension Liability - Ending (a)142,409,387$ 135,659,308$ 130,809,611$ 119,095,572$ 114,283,338$ Plan Fiduciary Net Position Net Plan to Plan Resource Movement -$ (203)$ -$ -$ -$ Contributions - Employer 36,706,983 4,441,517 4,105,810 3,819,770 3,557,098 Contributions - Employee 1,019,255 1,015,008 1,014,329 1,010,337 1,007,023 Net Investment Income 7,516,686 6,949,676 8,149,097 369,214 1,601,760 Benefit Payments, Including Refunds of Employee Contributions (6,658,719) (5,995,949) (5,779,040) (5,448,218) (5,288,251) Administrative Expenses (62,278) (126,575) (109,029) (45,185) (83,511) Other Changes in Fiduciary Net Position 203 (240,367) - - - Net Change in Plan Fiduciary Net Position 38,522,130 6,043,107 7,381,167 (294,082) 794,119 Plan Fiduciary Net Position - Beginning 87,270,402 81,227,295 73,846,128 74,140,210 73,346,091 Plan Fiduciary Net Position - Ending (b)125,792,532 87,270,402 81,227,295 73,846,128 74,140,210 Plan Net Pension Liability/(Asset) - Ending (a)-(b)16,616,855$ 48,388,906$ 49,582,316$ 45,249,444$ 40,143,128$ Plan Fiduciary Net Position as a Percentage of the Total Pension Liability 88.33%64.33%62.10%62.01%64.87% Covered Payroll 12,892,655$ 12,969,485$ 12,829,415$ 12,767,963$ 12,451,513$ Plan Net Pension Liability/(Asset) as a Percentage of Covered Payroll 128.89%373.10%386.47%354.40%322.40% Notes to Schedule: Changes in Assumptions:There were no assumption changes in 2023 or 2024.Effective with the June 30,2021 valuation date (June 30, 2022 measurement date),the accounting discount rate was reduced from 7.15%to 6.90%.In determining the long-term expected rate of return,CalPERS took into account long-term market return expectations as well as the expected pension fund cash flows.In addition, demographic assumptions and the price inflation assumption were changed in accordance with the 2021 CalPERS Experience Study and Review of Actuarial Assumptions.The accounting discount rate was 7.15%for measurement date June 30,2017 through June 30, 2021, and 7.65% for measurement dates June 30, 2015 through June 30, 2016. Changes in Benefit Terms:The figures above generally include any liability impact that may have resulted from voluntary benefit changes that occurred on or before the Measurement Date.However,offers of Two Years Additional Service Credit (a.k.a.Golden Handshakes) that occurred after the Valuation Date are not included in the figures above,unless the liability impact is deemed to be material by the plan actuary. Schedule of Plan Contributions Last Ten Years June 30, 2025 Actuarially Determined Contributions in Contribution Covered-Contributions as a Fiscal Contribution Relation to the Deficiency Employee Percentage of Covered- Year (ADC)(1)ADC(1)(Excess)Payroll(2)Employee Payroll(2) 2016 3,819,770$ (3,819,770)$ -$ 12,767,963$ 29.92% 2017 4,105,810 (4,105,810) - 12,829,415 32.00% 2018 4,441,517 (4,441,517) - 12,969,485 34.25% 2019 4,906,983 (36,706,983) (31,800,000) 12,892,655 284.71% 2020 2,437,119 (2,437,119) - 13,383,715 18.21% 2021 2,765,952 (3,965,952) (1,200,000) 13,768,586 28.80% 2022 2,971,785 (3,960,785) (989,000) 14,148,052 28.00% 2023 3,163,698 (5,477,698) (2,314,000) 14,539,529 37.67% 2024 3,095,172 (3,095,172) - 14,893,185 20.78% 2025 3,891,166 - 3,891,166 16,088,022 0.00% Notes to Schedule: Actuarial Cost Method Entry Age Actuarial Cost Method Amortization Method/Period Varies by date established and source. May be level dollar or level percent of pay and may include direct rate smoothing. Asset Valuation Method Fair value of assets Discount Rate 6.80% (net of investment and administrative expenses) Inflation 2.30% Salary Increases Varies by category, entry age, and duration of service. Payroll Growth 2.80% (1)Employers are assumed to make contributions equal to the actuarially determined contributions.However,some employers may choose to make additional contributions toward their unfunded liability.Employer contributions for such plans exceed the actuarially determined contributions. (2) Includes three year’s payroll growth assumption using 2.80% payroll growth assumption for fiscal year 2024; 2.75% payroll growth assumption for fiscal years 2018-2023; and 3.00% payroll growth assumption for fiscal years 2015-2017. The actuarial methods and assumptions used to set the actuarially determined contributions for Fiscal Year 2024-25 were from the June 30, 2022 public agency valuations. Also note, that some of the data from prior years were updated with the most current available information. Report on Internal Control Over Financial Reporting and on Compliance and Other Matters Based on an Audit of Financial Statements Performed in Accordance with Government Auditing Standards Board of Directors Otay Water District Spring Valley, California Independent Auditor’s Report We have audited, in accordance with the auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards issued by the Comptroller General of the United States, the financial statements of Otay Water District (“the District”), as of and for the year ended June 30, 2025, and the related notes to the financial statements, which collectively comprise the District’s basic financial statements, and have issued our report thereon dated October 29, 2025. Report on Internal Control Over Financial Reporting In planning and performing our audit of the financial statements, we considered the District's internal control over financial reporting (internal control) as a basis for designing audit procedures that are appropriate in the circumstances for the purpose of expressing our opinion on the financial statements, but not for the purpose of expressing an opinion on the effectiveness of the District’s internal control. Accordingly, we do not express an opinion on the effectiveness of the District’s internal control. A deficiency in internal control exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, misstatements on a timely basis. A material weakness is a deficiency, or a combination of deficiencies, in internal control, such that there is a reasonable possibility that a material misstatement of the entity’s financial statements will not be prevented or detected and corrected on a timely basis. A significant deficiency is a deficiency, or a combination of deficiencies, in internal control that is less severe than a material weakness, yet important enough to merit attention by those charged with governance. Our consideration of internal control was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control that might be material weaknesses or significant deficiencies. Given these limitations, during our audit we did not identify any deficiencies in internal control that we consider to be material weaknesses. However, material weaknesses or significant deficiencies may exist that have not been identified. Attachment C Report on Compliance and Other Matters As part of obtaining reasonable assurance about whether the District's financial statements are free from material misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements, noncompliance with which could have a direct and material effect on the financial statements. However, providing an opinion on compliance with those provisions was not an objective of our audit, and accordingly, we do not express such an opinion. The results of our tests disclosed no instances of noncompliance or other matters that are required to be reported under Government Auditing Standards. Purpose of this Report The purpose of this report is solely to describe the scope of our testing of internal control and compliance and the results of that testing, and not to provide an opinion on the effectiveness of the District’s internal control or on compliance. This report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the District’s internal control and compliance. Accordingly, this communication is not suitable for any other purpose. Irvine, California October 29, 2025 To the Board of Directors Otay Water District Spring Valley, California We have audited the financial statements of the Otay Water District (“the District”)as of and for the year ended June 30, 2025 and have issued our report thereon dated October 29, 2025. Professional standards require that we advise you of the following matters relating to our audit. Our Responsibility in Relation to the Financial Statement Audit As communicated in our engagement letter dated March 26, 2025, our responsibility, as described by professional standards, is to form and express an opinion about whether the financial statements that have been prepared by management with your oversight are presented fairly, in all material respects, in accordance with accounting principles generally accepted in the United States of America. Our audit of the financial statements does not relieve you or management of your respective responsibilities. Our responsibility, as prescribed by professional standards, is to plan and perform our audit to obtain reasonable, rather than absolute, assurance about whether the financial statements are free of material misstatement. An audit of financial statements includes consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control over financial reporting. Accordingly, as part of our audit, we considered the internal control of the District solely for the purpose of determining our audit procedures and not to provide any assurance concerning such internal control. We are also responsible for communicating significant matters related to the audit that are, in our professional judgment, relevant to your responsibilities in overseeing the financial reporting process. However, we are not required to design procedures for the purpose of identifying other matters to communicate to you. Planned Scope and Timing of the Audit We conducted our audit consistent with the planned scope and timing we previously communicated to you. Compliance with All Ethics Requirements Regarding Independence The engagement team, others in our firm, as appropriate and our firm, have complied with all relevant ethical requirements regarding independence under the American Institute of Certified Public Accountants (“AICPA”) independence standards, contained in the Code of Professional Conduct. We identified self-review threats to independence as a result of non-attest services provided. Those non-attest services included the preparation of the financial statements. To mitigate the risk, management has compared the draft financial statements and footnotes to the underlying accounting records to verify accuracy and has reviewed a disclosure checklist to ensure footnotes are complete and accurate. Attachment D Additionally, we utilize a quality control reviewer to perform a second review of the financial statements. We believe these safeguards are sufficient to reduce the independence threats to an acceptable level. Significant Risks Identified We have identified the following significant risks: Other Post Employment Benefits (OPEB) and Health Reimbursement Arrangement Implementation of GASB Statement No. 101: Compensated Absences Qualitative Aspects of the Entity’s Significant Accounting Practices Significant Accounting Policies Management has the responsibility to select and use appropriate accounting policies. A summary of the significant accounting policies adopted by the District is included in Note 1 to the financial statements. As described in Note 1 to the financial statements, during the year, the entity changed its method of accounting for compensated absences by adopting Government Accounting Standards Board (GASB) Statement No. 101. No matters have come to our attention that would require us, under professional standards, to inform you about (1) the methods used to account for significant unusual transactions and (2) the effect of significant accounting policies in controversial or emerging areas for which there is a lack of authoritative guidance or consensus. Significant Accounting Estimates Accounting estimates are an integral part of the financial statements prepared by management and are based on management’s current judgments. Those judgments are normally based on knowledge and experience about past and current events and assumptions about future events. Certain accounting estimates are particularly sensitive because of their significance to the financial statements and because of the possibility that future events affecting them may differ markedly from management’s current judgments. The most sensitive accounting estimates affecting the financial statements are: Management’s estimate of which capital projects represent ordinary maintenance activities necessary to keep an asset operational for its originally intended useful life versus significant improvement, replacement, and life extending projects that should be capitalized as additions to capital assets is based on management’s knowledge of the assets and their useful lives. We evaluated the key factors and assumptions used to develop the amounts added to capital assets in determining that it is reasonable in relation to the financial statements taken as a whole. Management’s estimate of transactions related to net pension liabilities based on actuarial information. We evaluated the key factors and assumptions used to develop the amounts by the actuary and determined that it is reasonable in relation to the financial statements taken as a whole. Management’s estimate of transactions related to net OPEB liabilities based on actuarial information. We evaluated the key factors and assumptions used to develop the amounts by the actuary and determined that it is reasonable in relation to the financial statements taken as a whole. Financial Statement Disclosures Certain financial statement disclosures involve significant judgment and are particularly sensitive because of their significance to financial statement users. The most sensitive disclosures affecting the District’s financial statements were: The disclosure of pensions in note 7 of the financial statements. The disclosure of OPEB in note 8 to the financial statements. The financial statement disclosures are neutral, consistent, and clear. Significant Unusual Transactions For purposes of this communication, professional standards require us to communicate to you significant unusual transactions identified during our audit.There were no significant unusual transactions identified as a result of our audit procedures. Identified or Suspected Fraud We have not identified or have obtained information that indicates that fraud may have occurred. Significant Difficulties Encountered during the Audit We encountered no significant difficulties in dealing with management relating to the performance of the audit. Uncorrected and Corrected Misstatements For purposes of this communication, professional standards also require us to accumulate all known and likely misstatements identified during the audit, other than those that we believe are trivial, and communicate them to the appropriate level of management. Further, professional standards require us to also communicate the effect of uncorrected misstatements related to prior periods on the relevant classes of transactions, account balances or disclosures, and the financial statements as a whole and each applicable opinion unit.There were no uncorrected misstatements that we identified as a result of our audit procedures. In addition, professional standards require us to communicate to you all material, corrected misstatements that were brought to the attention of management as a result of our audit procedures. There were no material misstatements that we identified as a result of our audit procedures. Disagreements with Management For purposes of this letter, professional standards define a disagreement with management as a matter, whether or not resolved to our satisfaction, concerning a financial accounting, reporting, or auditing matter, which could be significant to the District’s financial statements or the auditor’s report. No such disagreements arose during the course of the audit. Circumstances that Affect the Form and Content of the Auditor’s Report For purposes of this letter, professional standards require that we communicate any circumstances that affect the form and content of our auditor’s report. There were none. Representations Requested from Management We have requested certain written representations from management dated October 24, 2025. Management’s Consultations with Other Accountants In some cases, management may decide to consult with other accountants about auditing and accounting matters. Management informed us that, and to our knowledge, there were no consultations with other accountants regarding auditing and accounting matters. Other Significant Matters, Findings, or Issues In the normal course of our professional association with the District, we generally discuss a variety of matters, including the application of accounting principles and auditing standards, significant events or transactions that occurred during the year,operating and regulatory conditions affecting the entity, and operational plans and strategies that may affect the risks of material misstatement. None of the matters discussed resulted in a condition to our retention as the District’s auditors. Restriction on Use This report is intended solely for the information and use of the Board of Directors and management of the District and is not intended to be and should not be used by anyone other than these specified parties. Irvine, California October 29, 2025 Otay Water District Spring Valley, California INDEPENDENT ACCOUNTANT’S REPORT We have performed the procedures enumerated below, in reviewing the Otay Water District’s (“the District”) compliance with the requirements of the Investment Policy as such requirements apply to the Investments of the District for the period July 1, 2024, through June 30, 2025. The District is responsible for compliance with the requirements as noted in the referenced Investment Policies. The District has agreed to acknowledge that the procedures performed are appropriate to meet the intended purpose of determining compliance by the District with respect to the Investment Policy for the period July 1, 2024, through June 30, 2025.This report may not be suitable for any other purpose. The procedures performed may not address all the items of interest to a user of this report and may not meet the needs of all users of this report and, as such, users are responsible for determining whether the procedures performed are appropriate for their purposes. The procedures performed, and the results of those procedures are as follows: 1.Obtain a copy of the District’s investment policy and determine that it is in effect for the fiscal year ended June 30, 2025. Results:No exceptions were noted as a result of applying the above procedure. 2.Select 4 investments held at year end and determine if they are allowable investments under the District’s Investment Policy. Results:No exceptions were noted as a result of applying the above procedure. 3.For the four investments selected in #2 above, determine if they are held by a third-party custodian designated by the District. Results:No exceptions were noted as a result of applying the above procedure. 4.Confirm the par or original investment amount and market value for the four investments selected above with the custodian or issuer of the investments. Results:No exceptions were noted as a result of applying the above procedure. Attachment E Otay Water District Spring Valley, California Page 2 5.Select two investment earnings transactions that took place during the year and recompute the earnings to determine if the proper amount was received. Results:No exceptions were noted as a result of applying the above procedure. 6.Trace amounts received for transactions selected at #5 above into the District’s bank accounts. Results:No exceptions were noted as a result of applying the above procedure. 7.Select five investment transactions (buy, sell, trade or maturity) occurring during the year under review and determine that the transactions are permissible under the District’s investment policy. Results:No exceptions were noted as a result of applying the above procedure. 8.Review the supporting documents for the five investments selected at #7 above to determine if the transactions were appropriately recorded into the District’s general ledger. Results:No exceptions were noted as a result of applying the above procedure. We were engaged by Otay Water District to perform this agreed-upon procedures engagement and conducted our engagement in accordance with attestation standards established by the American Institute of Certified Public Accountants. We were not engaged to and did not conduct an examination or review engagement, the objective of which would be the expression of an opinion or conclusion, respectively, on the District’s accounting records. Accordingly, we do not express such an opinion or conclusion. Had we performed additional procedures other matters might have come to our attention that would have been reported to you. We are required to be independent of the District and to meet our other ethical responsibilities in accordance with the relevant ethical requirement related to our agreed-upon procedures engagement. This report is intended solely for the information and use of management of Otay Water District and is not intended to be and should not be used by anyone other than those specified parties. Irvine, California October 29, 2025 STAFF REPORT TYPE MEETING: Regular Board Meeting MEETING DATE: November 5, 2025 SUBMITTED BY: Jenny Diaz, District Secretary W.O./G.F. NO: DIV. NO. APPROVED BY: Jenny Diaz, District Secretary Jose Martinez, General Manager SUBJECT: Board of Directors 2025 and 2026 Calendars of Meetings GENERAL MANAGER’S RECOMMENDATION: At the request of the Board, the attached Board of Director’s meeting calendars for 2025 and 2026 are being presented for discussion. PURPOSE: This staff report is being presented to provide the Board the opportunity to review the 2025 and 2026 Board of Director’s meeting calendars and amend the schedules as needed. COMMITTEE ACTION: N/A ANALYSIS: The Board requested that this item be presented at each meeting so they may have an opportunity to review the Board meeting calendar schedule and amend it as needed. STRATEGIC GOAL: N/A FISCAL IMPACT: None. LEGAL IMPACT: None. Attachment: Calendar of Meetings for 2025 and 2026 AGENDA ITEM 8b Board of Directors, Workshops and Committee Meetings 2025 Regular Board Meetings: Special Board or Committee Meetings (3rd Wednesday of Each Month or as Noted) January 8, 2025 February 5, 2025 March 5, 2025 April 2, 2025 May 7, 2025 June 4, 2025 July 2, 2025 August 6, 2025 September 3, 2025 October 1, 2025 November 5, 2025 December 3, 2025 January 15, 2025 February 19, 2025 March 19, 2025 April 16, 2025 May 21, 2025 June 18, 2025 July 16, 2025 August 20, 2025 September 17, 2025 October 15, 2025 November 19, 2025 December 11, 2025 Board of Directors, Workshops and Committee Meetings 2026 Regular Board Meetings: Special Board or Committee Meetings (3rd Wednesday of Each Month or as Noted) January 7, 2026 February 4, 2026 March 4, 2026 April 1, 2026 May 6, 2026 June 3, 2026 July 1, 2026 August 5, 2026 September 2, 2026 October 7, 2026 November 4, 2026 December 2, 2026 January 21, 2026 February 18, 2026 March 18, 2026 April 15, 2026 May 20, 2026 June 17, 2026 July 15, 2026 August 19, 2026 September 16, 2026 October 21, 2026 November 18, 2026 December 16, 2026 STAFF REPORT TYPE MEETING: Regular Board MEETING DATE: November 5, 2025 SUBMITTED BY: Andrea Carey, Customer Service Manager PROJECT: P2662 DIV. NO. All APPROVED BY: Joseph R. Beachem, Chief Financial Officer Jose Martinez, General Manager SUBJECT: Update on the Customer Communication Plan for the Upcoming District-Wide Meter Changeout Project GENERAL MANAGER’S RECOMMENDATION: This is an informational item only. COMMITTEE ACTION: N/A PURPOSE: To provide the Board with an update on the customer communication plan for the upcoming District-wide Meter Changeout Project. BACKGROUND: On January 8, 2025, the Board approved for the General Manager to enter into an agreement with Badger Meter, Inc. for the purchase and installation of water meters and cellular transponders as part of a District-wide meter changeout program scheduled to span the next six years. This project includes the changeout of ¾-inch to 2-inch water meters and installation of cellular Automated Metering Infrastructure (AMI). Following a comprehensive contracting process, a kickoff meeting was held the week of September 1 between the District, Badger Meter, Inc., their installation consultant, Professional Meters, Inc. (PMI), and the District’s project management consultant, ESource Companies LLC. ANALYSIS: The Meter Changeout Project is expected to span six years. The current focus is on system design, establishing testing requirements, AGENDA ITEM 9a and customer communication and outreach planning. In January 2026 approximately 500 meters will be installed to test workflow, field quality control, and system readiness before proceeding to full deployment. District-Wide Communication and Outreach The Meter Changeout Project will affect every District customer’s meter over the course of six years. To ensure District customers are informed about the project, a variety of communication methods will be used as described below. District Newsletter, Social Media, and Project Webpage The District will use its newsletter and social media platforms to provide periodic updates about the project and direct customers to the project’s webpage. The project webpage will include an overview of the following: • Scope and timeline • FAQ • Project video The District will be working with Badger Meter, Inc. to develop a customized video that addresses common questions about the installation and overall project. All of these items will be available to District customers in both English and Spanish. Customer-Specific Communication the Month Prior to Installation Project Postcard and Email As the meter changeout for a specific customer approaches, the District will use a variety of communication methods to notify the customer. Approximately one month before the customer’s scheduled meter changeout, a postcard will be mailed to inform the customer of the upcoming work. At this time, it is not yet known whether the postcard will have sufficient space to include both English and Spanish text. If a full Spanish translation is not possible, a brief message in Spanish with a web link will be included to direct customers to a Spanish translated postcard. The postcard will also include a QR code linking the customer to the District’s project webpage for additional information. In addition, the District will send an email in both English and Spanish with the same message and a link to the project video. Email and Phone Call Two weeks later, approximately two weeks before the changeout, an automated phone message and an accompanying email, in both English and Spanish, will be sent to all affected customers to remind them of the upcoming changeout. All District messaging will emphasize the following key points: • The District is partnering with Professional Meters, Inc. to complete this work, and all personnel and vehicles will be clearly identified. Professional Meters, Inc. personnel will have identification showing they are working with both Badger Meters, Inc. and Otay Water District. • The homeowner does not need to be home for the work to be completed. • The changeout process will only take approximately 30 minutes. Day of Installation Communication Door Knock and Door Hanger Prior to the technician replacing the meter, they will attempt to make contact with someone at the residence by knocking on their door. If someone is home, the technician will explain that they are on site to change their water meter and that water service will be unavailable for approximately 30 minutes. If the customer cannot be without water at that time, the technician will attempt to reschedule later that day or the following day. If that is not possible, the customer will be asked to contact the office for assistance rescheduling. If there is no answer at the door, the technician will confirm water is not currently being used and then will proceed with the meter changeout. After successful meter replacement, the installation contractor will leave a door hanger at the property notifying the customer that the work has been completed. The door hanger will include a Spanish version on the reverse side. The door hanger will also provide tips for customers in case their water appears cloudy or runs inconsistently. If the installer is unable to change the meter at the time of arrival, and not able to make contact with the customer, the same door hanger will be left with a box checked indicating that the meter replacement could not be completed and instructing the customer to please call the District’s office for additional information. Internal Communication In addition to communicating with District customers, it is also important to inform and update District staff about the project. A project overview will be presented to all staff at the next Employee Information Meeting. In addition, Customer Service staff will be given daily updates during meter deployment in order to be aware of the areas where the contractor is working. Meter Services staff will have access to PMI’s work order management. The work order management system is used by PMI’s technicians to record all data related to the meter changeout. When visiting a location for changeout, PMI technicians will: • Validate the meter being changed matches the identified meter at the specific location, • record the final meter read before changeout and enter all new meter data. • take photographs of: the site prior to installation, the old meter prior to removal, the new meter installed, and the final condition of the meter box after the installation process is complete. This Data will be uploaded to this system where District staff will see this information and be provided real-time information on total meters installed, those in-progress, and those that need additional intervention by District staff before the installation can be completed. The project team who is made up of staff from Customer Service, Meter Services, IT, Finance, and Communications will have biweekly progress meetings to stay informed about all aspects of the project. The Board of Directors will be regularly updated through the General Manager’s Report and during the Directors’ Quarterly Meetings with the General Manager. FISCAL IMPACT: Joe Beachem, Chief Financial Officer This is an informational item only. STRATEGIC GOAL: Invest in technology infrastructure to enhance customer engagement and satisfaction by implementing advanced metering solutions that streamline service delivery and provide customers with timely, accessible information about their water use. LEGAL IMPACT: This is an informational item only. Attachments: A) Committee Action B) PowerPoint Presentation ATTACHMENT A SUBJECT/PROJECT: Update on the Customer Communication Plan for the Upcoming District-Wide Meter Changeout Project COMMITTEE ACTION: The Finance & Administration Committee (Committee) reviewed this item at a meeting held on October 22, 2025, and the following comments were made: • The Committee and staff discussed the scope and timeline of the meter change-out project, along with the plan for customer communications and outreach including but not limited to utilizing text messaging, social media, displaying the new AMI meters in the lobby, etc. District staff noted this will be monitored and evolve as needed to achieve effective and efficient outreach throughout the various phases of the project. • Staff indicated that homeowner presence is not required and that the typical change-out duration will average approximately 30 minutes. Following the discussion, the Committee supported staff’s recommendation and presentation to the full board as an informational item. Water Meter Changeout Project and Customer Communication Update ATTACHMENT B Meter Changeout •Meters are reaching the end of their 20-year lifecycle •District contracted with Esource, Inc. to assist with the procurement process •Request for Proposal issued mid-June 2024, to include meters, installation, AMI, and MDMS. Responses due July 31, 2024 •Six proposals received •Staff from Finance, Engineering, Water Operations, and IT involved in evaluation Meter Changeout •Otay Board of Directors approved the General Management to enter into an agreement with Badger Meter, Inc. for a District-wide meter changeout program •Contract was finalized in August 2025 •Kickoff meeting took place in early September between the District, Badger Meters, Inc., their installer Professional Meter, Inc. (PMI) and the District’s program management consultant, ESource Companies LLC. Project Timeline September 2025 - June 2026 July 2026 - June 2031 Planning & System Design Initial Meter Deployment (500 meters) System Integration & Testing Full Scale Deployment Meter Changeout •Meters are reaching the end of their 20-year lifecycle •District contracted with Esource, Inc. to assist with the procurement process •Request for Proposal issued mid-June 2024, to include meters, installation, AMI, and MDMS. Responses due July 31, 2024 •Six proposals received •Staff from Finance, Engineering, Water Operations, and IT involved in evaluation Initial Meter Deployment •Installation of approx. 500 meters in January 2026 •Two full meter routes (604 & 1703) and additional meters scattered throughout the District •The initial meter deployment will allow staff to test installation workflow, field quality control, system readiness and system integrations. Communication & Outreach Communication & Outreach City of Hanford, CA Customer Outreach Customer Outreach Internal Communication Overview to all staff at Employee Information Meeting. Customer Service staff updated daily once deployment begins. Meter Services staff will have access to PMI’s work order management system. Project Team will have biweekly project status meetings. Board of Directors will have updates via the General Manager’s Report and Director’s Quarterly Meetings. Questions? STAFF REPORT TYPE MEETING: Regular Board MEETING DATE: November 5, 2025 SUBMITTED BY: Charles Mederos, Utility Services Manager PROJECT: DIV. NO. 5 APPROVED BY: Andrew Jackson, Chief Water Operations Jose Martinez, General Manager SUBJECT: INFORMATIONAL ITEM – Emergency Declaration for the 12-inch ACP Main Leak Repair at Jamul Drive and Fowler Canyon in Jamul GENERAL MANAGER’S RECOMMENDATION: None. This is an informational item only. COMMITTEE ACTION: None. This is an informational item only. PURPOSE: To inform the Board of the General Manager’s execution of an emergency agreement with Cass-Arrieta Construction to repair the Otay Water District’s (District) 12-inch water main on Jamul Drive in Jamul caused by a main leak. ANALYSIS: As defined in the District Code of Ordinances Article I, Section 2.01, Paragraph I: “In a declared emergency, the General Manager may direct employees, take action to continue or restore service capability, and execute any contracts for necessary equipment, services, or supplies directly related and required by the emergency.” On Monday, September 29, 2025, Utility Maintenance staff isolated a section of the 12-inch asbestos cement (ACP) main located on Jamul Drive, near Fowler Canyon Drive, after observing significant water infiltration into a nearby sewer manhole and audible pressurization AGENDA ITEM 9b from a two-inch blow-off and air-vac assembly. Excavation to approximately seven feet revealed no visible leak, and the soil appeared dry. The section remained isolated to allow for drying and follow-up evaluation. When the main was later re-pressurized, water migration was observed entering from the west side of the excavation adjacent to a steel- encased portion of the main that passes beneath a storm-drain structure. Leak-correlation testing confirmed the leak was within the encased section (Attachment A). The affected segment did not directly impact customers; however, it serves as a critical interconnection maintaining hydraulic redundancy between the 803 and 932 pressure zones. A secondary failure could have resulted in widespread service disruption and diminished firefighting capacity. District staff determined that completing the repair safely was beyond in-house capabilities due to the following conditions: • The 12-inch AC main is encased within a 20-inch steel casing crossing under a storm drain. • The pipe is approximately 16 feet below grade, adjacent to a sewer main only five feet away, creating excavation and safety challenges. • Pipe material transitions entering the encased section were unknown. • The depth, confined alignment, and safety requirements exceed available District equipment and staffing resources. Given these constraints, a contractor with specialized equipment and experience is required. The General Manager declared an emergency on Thursday, October 9, 2025, to expedite repairs and prevent the loss or impairment of essential public services. The District contacted qualified construction contractors available to mobilize immediately. Cass-Arrieta Construction was selected and mobilized on Monday, October 13, 2025, after obtaining required permits in coordination with the County of San Diego. Cass-Arrieta Construction has since commenced pipeline replacement along Jamul Drive as part of the emergency repair. Upon excavating and exposing the pipe, it was determined that the cause of the leak was debris which may have lodged between the pipe and pipe collar, ultimately contributing to the pipe’s failure (Attachment B). Approximately 120 linear feet of 12-inch pipeline is being replaced to address the leak and deteriorated infrastructure to ensure long-term service reliability in the area. As part of the work, the contractor will install new air-vac assemblies upgraded from a one-inch to two-inch to improve air release and operational efficiency. A blow-off assembly previously located in this segment will be removed to optimize hydraulic performance and eliminate redundant appurtenances. In coordination with Water Systems Operations, thrust blocks will be installed at key locations to provide the required pipeline restraint. Accelerant will be used in the concrete mix to expedite curing, which will allow the pipeline to be pressure-tested and disinfected sooner. Upon completion of testing and disinfection, the repaired section is anticipated to be returned to service, and the roadway restored to pre- construction conditions by the second week of November. FISCAL IMPACT: Joe Beachem, Chief Financial Officer Based on a review by the Project Manager and an evaluation of the Utility Maintenance Operating, and the General Manager’s emergency budgets for FY2026, staff has determined that sufficient funds are available to cover these costs. The estimated amount is less than $250,000. STRATEGIC GOAL: This Project supports the District’s Mission statement, “To provide exceptional water and wastewater service to its customers, and to manage District resources in a transparent and fiscally responsible manner” and the General Manager’s Vision, "To be a model water agency by providing stellar service, achieving measurable results, and continuously improving operational practices." LEGAL IMPACT: This emergency was enacted in accordance with the District Code of Ordinances Article I, Chapter 2, Section 2.01, Paragraph I. Attachments: Attachment A – Map Attachment B – Photos ATTACHMENT A ATTACHMENT B CAUSE OF LEAK TRENCH AND SHORING DEPTH PIPE ANGLE 45 DEGREE TO 16 FEET DEEP PIPE INSTALLATION EQUIPMENT MOBILIZATION WORK AREA AND TRAFFIC CONTROL PIPE PROFILE AND LOCATION STAFF REPORT TYPE MEETING:Regular Board MEETING DATE: November 5, 2025 SUBMITTED BY: Jose Martinez General Manager WO/GF NO.: N/A DIV. NO.: N/A APPROVED BY: Jose Martinez, General Manager SUBJECT:General Manager’s Report GENERAL MANAGER: •East County Manufacturing EXPO – On Sept. 30, the District hosted an informational booth at the East County Economic Development Council’s 10th Annual Manufacturing EXPO at Cuyamaca College. Communications staff distributed materials on water-related careers and programs available to students, interns, and veterans. •Chula Vista NatureScape Workshop – On Oct. 4, communications staff gave a presentation at the City of Chula Vista Office of Sustainability’s annual NatureScape Workshop and Plant Giveaway. Staff presented on the District’s programs and local conservation resources, including the Water Conservation Garden. The workshop was held at the Chula Vista Civic Center Library. The event offered residents an opportunity to learn about planting for their sites, smart irrigation and landscaping, pollinators, stormwater management, and composting. Staff also hosted a booth. •Water-Use Efficiency Meeting at MWD – On Oct. 16, communications staff attended the Metropolitan Water District of Southern California’s in-person regional water-use efficiency meeting. Water agencies AGENDA ITEM 10 2 discussed updates on water supply, MWD and grant fundings, MWD external affairs, and outreach-related topics. • Women in Leadership Ceremony – On Oct. 17, communications staff attended the San Diego Regional East County Chamber of Commerce’s 23rd Annual Women in Leadership event at Sycuan Casino Resort. The program honors women who excel professionally and as community leaders. Among this year’s nominees was the Water Conservation Garden’s Director of Garden Operations Lauren Magnuson. The District also placed an advertisement in the event’s program related to the water workforce. • Foundations in Excellence Academy – On Oct. 22, Communications Assistant Eileen Salmeron completed The Centre for Organization Effectiveness’ Foundations in Excellence Academy. The program is designed to meet the needs of staff without supervisory responsibility who are interested in learning tools, concepts, and best practices. Through the academy, participants learn to enhance their self- awareness, personal development, and engagement at work. • Water Conservation Garden – In October, communications staff participated in the Water Conservation Garden Authority (WCGA) Joint Powers Agreement (JPA) meeting. The WCGA board members discussed approval of a three-year contract extension with its as-needed legal services company, Rutan and Tucker, LLP. In addition, Director of Garden Operations Lauren Magnuson provided an update on Garden operations and finances. Staff also participated in the monthly marketing meeting with other WCGA JPA agency staff to discuss the Garden’s action plan, promoting Garden events to the public, and arranging for Garden staff to attend WCGA JPA members' events, when possible, among other related topics. Staff will continue to participate in these meetings. • Social Media – The District joined water agencies on social media to celebrate the annual “California Water Professionals Appreciation Week,” Oct. 4-12. This year, the District partnered with the San Diego County Water Authority for the “We Love Water Pros” Campaign, which featured Otay’s Senior Disinfection Technician Jeff Goin, Environmental Compliance Specialist Juliana Luengas, and Communications Officer Tenille M. Otero. The District’s posts gained about 3,061 3 impressions and 242 engagements. In addition, on Oct. 16, the District highlighted the annual campaign “Could You Imagine a Day Without Water?” a reminder for customers that water supports every aspect of life. The posts gained about 781 impressions and 67 engagements. • WaterSmart Landscape Contest Winner Coverage – As a result of staff distributing a news release highlighting the WaterSmart Landscape winning couple to various media outlets and chambers of commerce, the District received coverage in the East County, Spring Valley, Chula Vista, and Otay Mesa chambers of commerce and South County Economic Development Council newsletters and/or social media platforms. The story also received coverage in the following online publications: o Association of California Water Agencies: acwa.com/news/watersmart-landscape-contest-winners-create-a-low- maintenance-garden-for-retirement o Water News Network: waternewsnetwork.com/low-maintenance-garden- for-retirement-wins-otay-water-district-2025-landscape-contest o East County Community Times: https://indd.adobe.com/view/a715c86d-7ebd-4296-a1c7-4ffe18f36169 (page 6) ADMINISTRATIVE SERVICES: Human Resources: • ERP/Tyler Conversion - HR started ERP/Tyler conversion meetings on 10/8/24; HR/Payroll went live on 10/6/25; ongoing. 4 • Open Enrollment 2025 – HR conducted open enrollment 10/15/25 through 10/29/25. Employee Open enrollment meeting was held on 10/22/25 with 44 total participants. • Employee Service Milestones – November/December 2025 o Johnny Gutierrez, Water Systems Operator III, will achieve 20 years of service on 11/15/25. o Brandon DiPietro, Field Services Manager, will achieve 25 years of service on 11/20/25. o No employees will achieve service credit milestones in 5-year increments in December 2025. • New Hires/Recruitments - The District is or will be recruiting for the following positions: o Business Systems Analyst I/II – Posted 8/26/25. Application review by the department is in progress. Phone screens were completed on 10/14/25 & 10/15/25. Panel interviews were completed on 10/23/25 & 10/29/25. o Chief, Administrative Services - Anticipated vacancy which will be created by a retirement. Posted 9/15/25. Application review is in progress. o Construction Inspector I/II – Recruitment posted on 10/27/25. Application review is scheduled for the week of 11/10/25. o Customer Service Representative I/II – Recruitment posted 9/18/25. Skills test is scheduled for 10/23/25 – 10/27/25. One retired annuitant started on 10/22/25 to assist temporarily. A second temporary employee started on 10/29/25. o District Secretary – Recruitment posted on 9/30/25. Interviews were completed on 10/16/25. Internal promotion became effective on 10/20/25 creating a Confidential Executive Assistant vacancy. o Equipment Mechanic I/II – New vacancy created by a retirement. Job posted on 8/20/25. Panel interviews were completed on 10/13/25 with additional interviews pending. o Meter Maintenance/Cross Connection Worker - Job posted on 7/21/25. Phone interviews were completed on 9/2/25. Panel interviews were completed on 9/8/25, 9/9/25, and 9/30/25. One new hire started on 10/14/25. One internal promotion is scheduled for 1/5/26 which will create a Utility Worker II vacancy. o Senior/Engineering Technician – Recruitment posted on 10/8/25. Application review is in progress. 5 o Utility Crew Leader – Job description revision is in progress; meet & confer with CEA. o Utility Worker I/II – Two (2) vacancies; continuous posting; applications are being sent to the department for review. Interviews were completed on 10/20/25 & 10/23/25. Skills testing was completed on 10/27/25. o Warehouse Technician - Recruitment posted on 10/27/25. Application review is scheduled for the week of 11/10/25. o Water Systems Operator I/II/III - Job posted on 7/23/25. Phone interviews were completed on 9/4, 9/5 & 9/9/25. Panel interviews were completed on 9/15, 9/16, 9/18, 9/22 & 9/23/25. One new hire is scheduled to start on 11/3/25. One internal promotion is scheduled for 11/17/25 which will create a Senior Utility Worker/Equipment Operator vacancy. IT Operations: • EERP Implementation - Staff successfully implemented and launched the Human Resources Management (HRM) module within the new ERP system. This milestone included completing critical tasks such as employee data migration, covering personnel records, position classifications, and benefits information to ensure a smooth transition of HR records. Additionally, the implementation team finalized essential file imports, including payroll history, timekeeping data, and employee benefit enrollment details, to ensure the system’s full functionality. While a few minor items remain in progress (Time & Attendance), the majority of data migration activities have been completed and are now fully integrated into the new system. Purchasing & Facilities: • Vegetation Management Planning Initiative – Recognizing changing fire patterns and increased regional risk, the District is proactively evaluating facilities in high and moderate fire hazard zones. Environmental Compliance Specialist, Juliana Luengas, and Purchasing & Facilities Manager, Kent Payne, are leading a coordinated initiative to develop formal Vegetation Management Plans (VMPs) to reduce wildfire exposure and safeguard District assets. This initiative builds on work conducted over the last two seasons to evaluate vegetation conditions around reservoirs, pump stations, and other critical sites. The intent is to move from reactive fuel reduction to a strategic, site-specific vegetation 6 management framework that can guide long-term maintenance practices, contractor scopes, and budgeting. To support this effort, staff has engaged Environmental Science Associates (ESA), one of the District’s as-needed environmental consultants, to prepare a proposal for developing VMPs. The proposal, now under refinement, outlines a comprehensive approach that includes: o Field surveys and vegetation mapping for 21 District facilities, including a 250-foot buffer area around each site; o GIS-based classification of plant communities and assessment of fuel loading, invasive species, and threats; o Development of management recommendations tailored to each facility’s conditions and fire risk; and o Integration of regulatory and environmental compliance considerations aligned with state and local codes. While ESA’s preliminary submittal demonstrates a thorough understanding of wildfire management principles, some elements exceed the District’s immediate requirements. A revised scope is being requested to focus efforts on actionable vegetation management measures that can be integrated with existing landscape maintenance contracts and future fire-risk mitigation projects. This project comes at a critical time, as community awareness and concern about wildfire hazards have increased, particularly around several District properties adjacent to residential areas and open space preserves. It also aligns with recent Board interest in ensuring that District sites are adequately protected from fire exposure and environmental liability. Once finalized, the Vegetation Management Plans will serve as a guiding document for Facilities and Environmental staff, enabling consistent practices for vegetation control, defensible-space management, and contractor oversight. The plans will also strengthen the District’s ability to communicate proactive fire- risk reduction measures to the public and partner agencies, reinforcing OWD’s commitment to responsible asset stewardship and community safety. Safety, Emergency Management, and Security: • ACWA JPIA Risk Management Services - Staff met with ACWA JPIA’s (ACWA) Sr. Risk Advisor to finalize participation in their Strain 7 & Sprain Reduction Program for field staff. Strains and sprains remain the leading cause of loss for workers’ compensation pool members. According to ACWA, 36% of all losses are related to strain/sprain injuries within the insurance pool. ACWA partnered with Future Industrial Technologies (FIT) to conduct hands-on industrial ergonomic training for Utility Maintenance staff. Staff created and finalized the standard operating procedures (SOP) for jackhammering and will refer to the document during the December 2025 onsite training. FINANCE: • FY 2026 Debt Issuance – Staff is reconciling audited financials to debt service coverage calculations, defining/clarifying revenue and expense classifications, and preparing footnote explanations for adjustments. Next meetings to focus on necessary items to begin drafting the preliminary official statement. Refinancing existing debt is still being explored. • Meter Replacement Program – Several meetings have been held between the District, Badger Meter, PMI, and ESource to prepare for testing, system integration, customer communications and business process design for the new AMI system and meters. The initial deployment of 500 meters are expected to take place in January. This small batch of meters will assist with testing installation workflow, field quality control, system readiness and system integrations. • New Banking Relationship – Staff are in the process of completing an evaluation to contract with Neighborhood National Bank (NNB) for investment services through NNB’s Certificate of Deposit Account Registry Service (CDARS) program. The District has previously participated in the CDARS program, which invests in certificates of deposit (CDs) across multiple banks within FDIC insurance limits. Financial Reporting: • The financial reporting as of September 30, 2025, is as follows: o As of the third month ending September 30, 2025, there are total revenues of $40,485,614 and total expenses of $40,262,904. The revenues exceeded expenses by $222,710. • The financial reporting for investments as of September 30, 2025, is as follows: o The market value shown in the Portfolio Summary and in the Investment Portfolio Details as of September 30, 2025, total 8 $102,895,701 with an average yield to maturity of 4.135%. The total earnings year to date are $1,037,188. ENGINEERING AND WATER SYSTEM OPERATIONS: Engineering: • Vista Diego Hydropneumatic Pump Station Pump, Hydropneumatic Tank, and Backup Power Replacement, 1530 Zone, Vista Diego Road: The project includes the replacement of the existing pumps, the hydropneumatic tank, and backup power. A concept including a temporary domestic pump skid to be located just outside of the existing pump station yard between Vista Diego Road and the existing pump station site in a shared easement with SDG&E was vetted by Engineering and Operations on July 10, 2025. District in-house engineering staff, supported by the District’s as-needed electrical engineer, EPI, are progressing with 90% design of bid documents to install the skid. After the District Water System Operations staff gains experience and confidence operating the temporary pump station skid, a second phase of the project will be implemented to replace the existing site domestic pumps and existing hydropneumatic tank. A purchase order for a domestic pump skid was issued under General Manager authority on September 30, 2025. The project is within budget and on schedule. (P2639, P2663, and P2688) • RWCWRF Disinfection System Improvements: The project involves the replacement of the chlorine gas disinfection system with an ultraviolet (UV) process at the Ralph W. Chapman Water Reclamation Facility. A construction contract has been awarded to GSE Construction Co., Inc. On February 21, 2024, staff presented the Disinfection Improvement project at the Board Workshop as an informational item. A Notice to Proceed was issued for April 8, 2024, and the contractor has mobilized and begun construction. The contractor ordered the Trojan UV system, which arrived on August 22, 2024. The first and second planned shutdowns were combined to minimize downtime at the plant and were successfully completed on December 2, 2024. Work completed during the shutdown included new backwash pumps and the installation of a new flow meter. On February 6, 2025, the state granted a conditional acceptance of the Engineering Report. The contractor installed the Trojan UV system, and testing and commissioning of the Trojan UV system will continue through November 2025. The State Water Resources Control Board Department issued the Conditional Title 22 Acceptance Permit in April. Testing and commissioning of the Trojan UV System was initiated at the end of May 2025. Pretesting and diagnostics are being conducted on the UV System by Trojan prior 9 to completing the initial performance testing. The project is on schedule and on budget. (R2117 and R2157) • 450-1 Recycled Water Reservoir Stormwater Improvements: Stormwater runoff from the 450-1 Recycled Water Reservoir site has been eroding the downstream area and exposed the District's 30-inch recycled water line. Staff is working with NV5 on potential design and permitting solutions. Helix Environmental is currently updating the regulatory permits for the work within the tributary. The project is within budget and on schedule. (R2164) • Zero Emission Vehicles and Charging Infrastructure: The project is for the capital purchase and installation of various electric vehicle support equipment, such as charging infrastructure needed to power Zero Emission Vehicles (ZEVs) for light, medium, and heavy- duty electric vehicles. The project is in preparation for compliance with the State of California's Executive Order N-79-20 and the Advanced Clean Fleet Regulation to require ZEV purchases when adding to the District's fleet of vehicles. The State’s Advanced Clean Cars II regulations are still in place. Due to recent geopolitical events, the District will continue monitoring the current requirements and adjust the implementation and budgeting of the charging infrastructure as needed. In December 2024, the District was awarded $128,093 in grant funding for the installation of five (5) electric vehicle battery charging stations from the Clean Air for All Grant from the San Diego Air Pollution Control District. The final electrical design of the five charging stations was completed in March 2025. The new charging stations were ordered in April 2025 and delivered in May 2025. Contract documents are being finalized by staff and anticipated to be completed this fall. The project is within budget and on schedule. (P2684) • Potable Pipeline Replacement Projects: The following set of pipelines is being replaced as a result of past failures, age, lack of redundancy, and/or improved fire flow. The 60% design plans were reviewed by staff and returned to NV5 in August 2025. o PL - 8-inch, 850 Zone, Coronado Avenue, Chestnut/Apple (P2608) o PL - 8-inch, 1004 Zone, Eucalyptus Street, Coronado/Date/La Mesa (P2609) o PL - 12-inch Pipeline Replacement, 803 PZ, Vista Grande (P2615) o PL - 20-inch, 1296 Zone, Proctor Valley Road from Pioneer Way to Melody Road, “South Proctor Road” (P2171) o PL - 20-inch, 1296 Zone, Proctor Valley Road from Melody Road to Schlee “North Proctor Road” (P2058) – Easement offer letters were sent to property owners on November 19, 2024. A meeting 10 was held on December 10, 2024, with three of the six property owners. Separately, five property owners submitted a letter of interest in the offer. Escrow had been initiated with five of six owners who have accepted the letter of interest. Escrow instructions were sent by the District on July 7, 2025. October 15, 2025, Escrow has been closed with 4 of 6 owners. The eminent domain process will be initiated with a non-responsive owner. The project is within budget and on schedule. • Steele Canyon Road Bridge 20-inch Water Main and 6-inch Force Main Renovations: Several portions of the existing pipelines were noted to have corrosion pitting, primarily located at pipe supports for the 20-inch steel potable water main and at pipe joints for the 6- inch steel sewer force main. The first phase, to assess the extent of the corrosion, has been completed, and staff is now working on preparing recommendations for the repairs of the pipelines. The project is within budget and on schedule. (P2687 & S2079) • Olympic Parkway Recycled Water Line Replacement: Several main breaks within the past few years on the 20-inch recycled water line in Olympic Parkway between Heritage Road and La Media Road resulted in the establishment of this Capital Improvement Program project at the May 2021 Board Meeting. The project was awarded to Burtech in January 2023. The City of Chula Vista permits have been obtained. Consideration was given to potentially using trenchless installation, but several drawbacks and limitations eliminated it from selection. The contractor started procuring materials, and a Pre-Construction Meeting was held on June 8, 2023. A Notice to Proceed was issued for March 25, 2024, and most of the work will be night work to minimize traffic delays. The valves were delivered and tested at the end of May 2024. The contractor mobilized on July 15, 2024. Burtech completed the final pipeline tie-in on January 14, 2025, and pavement restoration on February 24, 2025. The final walk for project acceptance was conducted on September 4, 2025. Staff is processing the project acceptance. The project is within budget. (R2159) • Olympic Parkway Transmission Main Assessment and Repair: Several main breaks within the past few years on the 16-inch potable water line in Olympic Parkway between East Palomar Street and State Highway 125 resulted in the establishment of this Capital Improvement Program project through the annual budget process. This project is for the condition assessment and repair of interior joints within approximately 3,500 feet of the 16-inch cement mortar-lined and coated steel transmission main along Olympic 11 Parkway east of East Palomar Street. The first phase of this project was an interior pipeline inspection to assess the condition of the interior pipeline joints. The interior video inspection has been completed. Staff are working on preparing recommendations for the repairs of the pipeline in collaboration with Operations staff. The project is within budget and on schedule. (P2706) • Cottonwood Sewer Pump Station Replacement: The project involves the replacement of the existing sewer pump station originally constructed in 1986 as a temporary facility due to operational and accessibility deficiencies. The station serves both the District and County of San Diego customers on the south side of the Sweetwater River. Improvements will incorporate increased station capacity and the addition of emergency storage to avoid a sewage spill. The design is being prepared by Wood Rodgers, Inc. An alternative to reduce cost was confirmed with District Operations staff, Wood Rodgers, and the County on May 7, 2025. A third amendment to the Wood Rodgers professional services agreement corresponding to the cost savings alternative was executed on June 27, 2025. Wood Rodgers coordinated Preliminary Design Report hydraulic calculations with pump field test data collected on September 24, 2025. Construction of the project is currently estimated for completion in FY 2031. The project is within budget. (S2069) • 870-2 Reservoir and 870-1 Reservoir Floating Cover/Liner Replacement: This project consists of constructing a new 3.4 MG prestressed concrete potable water tank adjacent to the existing 870-1 Reservoir. The project also includes lowering the existing 870-1 Reservoir 30-inch inlet pipe and replacing the existing floating cover and liner within the existing 870-1 Reservoir. The construction contract was awarded to Pacific Hydrotech at the September 2024 Board Meeting. Pacific Hydrotech mobilized to the site on October 28, 2024. Pacific Hydrotech constructed the new 870-2 Reservoir concrete slab and concrete tank walls, columns, and roof during July through October 2025. Both projects are within budget and on schedule. (P2228 & P2563) • Telegraph Rd – Hydrant Repair: In late April 2024, a vehicle accident damaged a dual-purpose blow-off valve and fire hydrant appurtenance located at 1052 Telegraph Canyon Road, Chula Vista, approximately 800 feet east of Heritage Road/Paseo Ranchero. The fire hydrant has been struck three (3) times by vehicles in the past seven (7) years. Notably, in the most recent incident, not only was there damage to the above-ground appurtenance, but when operating the 6-inch valve to isolate the fire hydrant, a break was 12 identified near the 20-inch ACP water main. This water main is a major arterial water line and provides potable water to nearby critical infrastructure, including a hospital. Repairs to the pipeline are complicated due to the pipeline’s depth, requiring outside contractors with equipment to repair it at that elevation. The water main is approximately 16-feet deep near the fire hydrant. There are nearby utility crossings, which include a triple 6-foot by 10-foot box culvert, an 8-inch-high pressure gas line, a 36- inch storm drain, and a 30-inch steel casing on the 20-inch water main. The project was awarded to M-Rae Engineering at the February 5, 2025 Board Meeting. A Pre-Construction Meeting was held on June 24, 2025. A Notice to Proceed was issued on August 4, 2025. Repair was made and service to the 20-inch main on Telegraph was restored August 20, 2025. Repair was completed September 5, 2025 and the 20-inch main has been restored to service. Site restoration was completed by October 6, 2025. The project expenditures will come from the operating budget. Staff is working on accepting and closing out the project. (P1000) • 1004-2 & 1485-2 Reservoir Interior/Exterior Coating & Upgrades: This project is for the interior and exterior coatings of the 1485- 2 Reservoir, located at 15010 Lyons Valley Road, Jamul. This welded steel Reservoir has a 1.6-million-gallon capacity. Based upon the current inspection report, the interior and exterior coatings on the 1485-2 Reservoir are nearing the end of their useful lives and need replacement. The Reservoir was constructed in 2006 and has never been recoated. In addition to removing the existing interior and exterior coating and recoating the Reservoir, the project includes rafter replacement, seismic rod replacement, cathodic protection equipment replacement, and structural modifications. Additionally, the project includes door modifications to the 1004- 2 Reservoir, located at 1711 Buena Vista Avenue, Spring Valley. This welded steel Reservoir has a 1.26-million-gallon capacity. The project was approved for award to Unified Field Services Corp. at the November 2024 Board Meeting with a budget adjustment. A Notice to Proceed was issued for January 13, 2025, and the contractor mobilized on January 14, 2025. The contractor completed the structural and mechanical repairs. The interior coating was completed August 8, 2025. The exterior coating was completed October 1, 2025. Final punch list items were addressed, and tank was online by the end of October 2025. The project is within budget and on schedule. (P2631 & P2657) • 711 Pump Station Replacement and Expansion and Potable Water Pressure Vessel Program (711 Pump Station Surge Tank): The 2015 Water Facilities Master Plan envisioned total replacement of the 13 711 Pump Station with a budget of $16M; however, the CIP P2578 concept was re-evaluated with a new concept to restore the original pump capacity while utilizing the pump station structure to reduce cost. The initial project will remove one (1) of the existing five (5) nominal 2,500 GPM pumps and replace it with a nominal 4,000 GPM pump and reconfigured discharge and suction piping as a pilot project. The 1990-era 711 Pump Station surge tank pressure vessel was inspected on August 30, 2021. The inspection report noted interior corrosion due to internal coating wear. The February 2021 inspection report also recommended reinspection the following year; however, District staff determined it was better to be proactive and replace rather than repair the surge tank vessel. Approval to pre-purchase a nominal 4,000 GPM pump to be included in the pilot project was authorized at the February 5, 2025 Board Meeting. The award of the construction contract for the pilot pump configuration and surge tank replacement was approved at the June 2025 Board Meeting. The contract was signed, and a Pre-construction Meeting was held on August 18, 2025. The contractor, Jennette Company, Inc. completed field measurements for steel pipe shop drawings on October 7, 2025. Delivery of the pre-purchased pump is anticipated in November 2025. The project is within budget and on schedule. (P2578 & P2663) • City of San Diego – Otay 2nd Pipeline Phase 4 Interconnections Relocation: The City of San Diego (City) is working on Phase 4 of the replacement and realignment of the 40-inch potable water line between Telegraph Canyon Road and Bonita Road with a 48-inch pipeline. The District has two interconnections to this line located at East H Street and Telegraph Canyon Road that will need to be replaced to conform to the new construction. The City recently completed the 60% design stage for the new pipeline. The District’s staff has reviewed the City’s 60% design and identified potential utility conflicts that are being coordinated with the City. The two potential interconnection relocations have been identified and are being considered. Additionally, new interconnection agreements with the City are being evaluated and will be finalized concurrently with the City finalizing their pipeline design. The City design is expected to be finalized at the end of FY 2027/beginning of FY 2028. The design is currently in the environmental permitting stage. (P2691) • City of Chula Vista – Heritage Road Replacement: The City of Chula Vista is constructing a new bridge crossing the Otay River at Heritage Road, which provides an opportunity for the District to relocate an existing pipeline out of the river into a more secure location. The City of Chula Vista opened bids in September and 14 awarded the contract at their October 8, 2024 Council meeting. The District Board approved the reimbursement agreement on March 1, 2023. The City of Chula Vista Council approved the agreement at their January 7, 2025 Council meeting. The reimbursement deposit has been wired to the City of Chula Vista. Staff continue to process submittals and RFIs. Installation of the pipelines in the bridge began on September 8, 2025. The project is within budget. (P2553, P2405) • Sycuan Treatment Plant: The Sycuan Tribal Nation is working with the District to evaluate the feasibility of accepting processed solids from their proposed Recycled Water Treatment Plant. The District initiated a Task Order for NV5 to provide engineering services in the technical evaluation of accepting the solids stream, especially as it would combine with the municipal sewer flows into the Ralph W. Chapman Water Recycled Water Facility. This project is paused until additional funds are deposited. Construction of the facility was observed by staff. On October 15, 2025, a letter was sent to Sycuan requesting clarification of their waste discharge location as no deposit had been received to allow for Otay’s continued evaluation. In a letter dated October 17, 2025, Sycuan responded with concerns about the letter. Otay staff have provided clarifications in a letter dated October 29, 2025, and are reaching out to Sycuan staff to continue coordination efforts. • Recycled/Reuse Feasibility: The Sweetwater Authority (SWA) and the District are working collaboratively through a Memorandum of Understanding (MOU) to evaluate the feasibility of extending water reuse into the SWA area. On February 7, 2024, a Professional Services Agreement (PSA) for a feasibility study was awarded by the Board to Carollo Engineers (Carollo). On June 20, 2024, the District was approved for grant funding from the Water Recycling Funding Program for the SWA and OWD Intertie Project for $300,000. The District, SWA, and Carollo are conducting biweekly progress meetings and collecting data for the Planning and Feasibility Report. Carollo is in the process of reviewing and assessing data from both agencies and coordinating additional data as needed. Carollo plans to submit draft chapters in three parts. A meeting with the leadership of SWA and Otay was held on August 14, 2025, to present a summary of the findings. A meeting was held with combined SWA and Otay Ad hoc on October 6, 2025, to review the draft findings prior to submitting the information to the State Board as the granting agency. A Reimbursement Request for all work completed in FY 2025 was submitted to the State Water Resources Control Board (SWRCB) in August 2025. (R1254) 15 • Otay Water District Climate Adaptation and Resilience Planning Project: On November 21, 2023, FEMA approved and issued Hazard Mitigation Grant Program (HMGP) funds for the preparation of a Climate Adaptation and Resilience Plan (CARP) for the District. FEMA authorized a total of $244,939.70. The CARP will include a risk and resilience assessment focusing on climate change. The CARP will also include the development of resilience and adaptation strategies to allow the District to prioritize risks. Strategies may include updated policies, built infrastructure-based measures, green infrastructure-based measures, operational approaches, staff training and tools, and communication and education for customers. The final Plan will be incorporated into the District’s Local Hazard Mitigation Plan Annex. The project is within budget and on schedule. (P1253) • Water Facilities Master Plan, Urban Water Management Plan, and Integrated Water Resources Plan: The next update for the WFMP with the Program Environmental Impact Report (PEIR) will be done in parallel with two (2) other District planning documents, the Urban Water Management Plan (UWMP) and the Integrated Water Resources Plan. The UWMP update is required for compliance with the State Water Boards. Combining the three (3) planning documents is anticipated to provide efficiency and cost savings. In accordance with the District’s purchasing requirements, the project was approved for award to Woodard and Curran at the April 2025 Board meeting. The Kick-Off Meeting was held June 16, 2025. Staff is currently working with the consultant on the plan updates. The project is within budget and on schedule. • Border Patrol – Canine Search and Rescue: An agreement to allow for canine search and rescue training at the Salt Creek property is being considered with the US Border Patrol. • Sewage Flows to Metro vs Planned Capacity: The Metropolitan Water District Amended and Restated Regional Wastewater Disposal Agreement became fully effective at the start of FY 2023. The District’s annual capacity of 0.38 MGD (139 MG) is now in effect, though the District would need to exceed this capacity for three (3) consecutive years before additional capacity must be acquired. The Metropolitan Water District (Metro) capacity was set based upon the District’s sewer system requirements through planning year 2050. The current annual cumulative discharge total for FY 2026 is 1.90 MG, well below the 139 MG planned annual capacity. 16 • Summary of Budgeted and Sold Meters and EDUs for Fiscal Year 2026 through September 2025: Operations: • On Wednesday, September 17th, Utility Maintenance staff replaced and backfilled a broken eight-inch fire service valve at 1301 Medical Center Drive in Chula Vista. The issue was identified during routine valve exercising operations. • On Friday, September 19th, Pump/Electric Staff successfully completed a complex repair to restore full functionality to Pump #2 at the Cottonwood Lift Station. The work involved specialized coordination, including the temporary use of a mobile pump to maintain uninterrupted service and prevent potential overflows during the repair process. Following completion, the facility was Date Meters (Budgeted) Meters Sold (Actual) EDUs (Budgeted) EDUs Sold (Actual) Total $ (Budgeted) Total $ Collected (Actual) September 2025 7.8 11 31.8 24 $475,684 $359,866 Totals FY 2026 23.3 24 95.4 66.5 $1,427,052 $994,713 17 thoroughly tested and returned to normal operation with all systems performing as intended. • On Saturday, September 20th, the standby Utility Maintenance staff responded to an emergency main break at 237 Sacramento Avenue in Spring Valley. A tapping saddle for a six-inch hydrant lateral on an eight-inch ACP main had failed. The repair required a shut down that included a nearby convalescent home. The facility had reserved water storage, and they remained unaffected. Staff replaced eight feet of the main to restore water service. On Tuesday, September 23rd staff tapped a new fire hydrant lateral with valve and restored the existing hydrant. • On Wednesday, September 24th, Water Systems staff performed a planned shutdown on Otay Meas Road and Vann Center Blvd in the Otay Mesa area. This shutdown was required to allow a contractor to cut in a four-inch air vac on the District’s 24-inch main to accommodate a new pipeline installation (Developer project #1199). The shutdown lasted approximately 13 hours, and no meters were affected during this event. • On Thursday, September 25th, Water Systems staff performed a final walk-through inspection for a new development, Otay Ranch Village 8 West Phase 1 Town Center (Developer project #1044). No issues were noted on the punch list. Final walk-through inspections are required to ensure proper operation/construction of newly built District infrastructure before being accepted. • On Saturday, September 27th, Water Systems staff, with assistance from Utility Maintenance staff, performed a planned shutdown on East J Street in the Chula Vista area. This shutdown was performed to replace a fire service valve that was found inoperable during routine valve maintenance. Water isolation valves are critical components of a water distribution system for isolating pipe segments for repair and maintenance purposes. The shutdown lasted approximately six hours and affected six meters, with one water trailer available for the affected customers. • On Monday, September 29th and Tuesday, September 30th, Fleet Maintenance staff had a scheduled assessment with District consultants regarding the Spill Prevention Control and Countermeasure (SPCC) plan five-year review. The consultants are still drafting the plan for management approval. • On Monday, September 29th and Tuesday, September 30th, staff performed mocks shutdowns on East J Street and Redbud Place in the Chula Vista area for an upcoming planned valve replacement project. 18 The mock shutdowns confirm that the necessary conditions are in place to execute the full shutdown required to carry out the scheduled maintenance activities. The first shutdown was performed on Tuesday, October 21st and anticipate completing the valve replacements in this area by Friday, November 14th. • On Wednesday, October 1st, Fleet Maintenance staff took delivery of two new vehicles: a Ford E-Transit new vehicle unit #285 replacing pump mechanic vehicle unit #185 and a Ford F150 new vehicle unit #284 replacing water systems operator vehicle unit #234. • On Friday, October 3rd, Water Systems staff performed a final walk- through inspection for the new development on Cactus Rd and Secano Street in the Otay Mesa area. (Developer project #D1021). No issues were noted on the punch list. Final walk-through inspections are required to ensure proper operation/construction of newly built District infrastructure before being accepted. • The following events occurred on Tuesday, October 9th: o Water Systems staff collaborated with Utility Maintenance staff to isolate a 12-inch section of a water main located beneath a storm drain culvert at Jamul Drive and Fowler Canyon Road in Jamul. The leak was initially identified by Utility Maintenance staff’s collections group, who observed unusual infiltration in a nearby sewer manhole. The affected pipe is encased in steel and is approximately 12 feet deep. Due to the severity of the issue, the General Manager declared this an emergency. A construction District vendor was assigned to perform the repair and mobilized on Monday, October 13th. Another District vendor provided daily traffic control with flaggers from 7:00 AM to 4:30 PM. Excavation was completed on both sides of the storm drain, and the 12-inch asbestos cement pipe (ACP) was removed. Completion of the work is anticipated by Friday, October 31st. o Utility Maintenance staff supported Water Systems Operators with a mock shutdown at Appalachian Place and South Creekside Drive in Chula Vista, in preparation for a hydrant valve replacement. The leaking valve, which was reported by a local resident, was successfully replaced and backfilled on Friday, October 10th. • On Monday, October 13th, Fleet Maintenance staff took delivery of a Ford E-Transit new vehicle unit #286 to replace fleet vehicle unit #189. • On Wednesday, October 15th, Water Systems staff led the testing of the Temporary Lower Otay Pump Station (TLOPS) to confirm both pumps were operating correctly in preparation for the upcoming San Diego 19 County Water Authority’s 10-day shutdown of Pipeline 4, scheduled for December 7–16, 2025. During the shutdown, TLOPS will serve as the sole water supply source for the South District. • The following events occurred on Saturday, October 18th: o Utility Maintenance staff on stand-by responded to an emergency leak at 1048 Camino Del Sol in Chula Vista. The homeowner ripped out the one-inch meter and meter stop while operating a mini excavator. Since the homeowner was continuing to perform demo work, the service line was cut and capped at the main line to protect the distribution system from any further damage. o Utility Maintenance staff replaced an eight-inch fire service valve on Dornoch Court in Otay Mesa. To limit disruption to commercial businesses in the area, the work was performed on a Saturday. • On Monday, October 20th, Inflows on the Otay #14 connection were dropped to zero at the request of Helix Water District (Helix) during San Diego County Water Authority’s (CWA) raw water shutdown, affecting water deliveries to Helix. During this time, flow needs for the north District were met by using the Otay #11 connection from CWA’s Pipeline #4 in Spring Valley. • During this period, Pump/Electric staff performed preventive maintenance on 15 air compressors. This proactive maintenance supports the longevity and reliability of critical equipment, minimizes downtime, and reduces the likelihood of unplanned repairs, helping to maintain consistent system performance and operational efficiency. PURCHASE AND CHANGE ORDERS: • The following table summarizes purchases and change orders issued, within staff’s signatory authority, during the period of September 5, 2025 – October 21, 2025: PO Date Action PO Amount PO Description Vendor Name 9/5/25 PO $5,300.00 PROCTOR VALLEY ROAD (P20258) GRANT OF EASEMENT – JAMES STEWART 9/17/25 PO $40,000.00 FY26 GENERAL HEALTH & SAFETY CONSULTING SUPPORT LINDSAY POLIC CONSULTING INC 9/18/25 PO $1,300.00 PROCTOR VALLEY ROAD (P20258) GRANT OF EASEMENT – 20 BONNER FAMILY TRUST 9/22/25 PO $8,620.00 METER BUSHINGS 3/4" TO 1" PACIFIC PIPELINE SUPPLY INC 9/22/25 PO $20,000.00 FY26 SAFETY CONSULTING & SUPPORT SERVICES RELIANCE SAFETY CONSULTANTS 9/22/25 PO $10,000.00 FY26 FIRE SPRINKLER INSPECTION AND SERVICE THE HILLER COMPANIES 9/23/25 PO $13,507.22 RATE INCREASE PRINTING & MAILING SERVICES OMNI GRAPHICS 9/23/25 PO $36,441.00 FY26 INVESTMENT ADVISOR FOR DEFERRED COMP PLANS SAGEVIEW ADVISORY GROUP LLC 9/24/25 PO $7,087.50 FY26 ARCGIS SUBSCRIPTION/ SOFTWARE LICENSE ESRI 9/24/25 PO $14,322.13 METER GASKETS FERGUSON WATERWORKS #1083 9/25/25 PO $1,930.76 OMNI 10" F2 REGISTERS AQUA-METRIC SALES COMPANY 9/29/25 PO $1,656.69 ORION ENDPOINTS BADGER METER INC 9/29/25 PO $3,200.00 PROCTOR VALLEY ROAD (P20258) GRANT OF EASEMENT – JUAN GRAJEDA 09/30/25 CO NO. 1 -$24,002.75 1485-2 TANK INT/EXT COATING PROJECT (P2631) UNITED FIELD SERVICES CORP. 9/30/25 PO $86,468.25 VISTA DIEGO HPS DOMESTIC PUMP SKID PURCHASE (P2639) BARRETT ENGINEERED PUMPS 10/1/25 PO $12,234.35 PREPAID POSTAGE FOR RE- MAILING RATE NOTICES US POSTMASTER 10/1/25 CO NO. 2 -$57,500.00 OLYMPIC PARKWAY RECYCLED WATERLINE REPLACEMENT (R2159) BURTECH PIPELINE 10/1/25 PO $9,148.96 TOUGHBOOKS CDCE INCORPORATED 10/21/25 PO $1,217.20 ETRU w/ NICOR CONNECTOR RG INCORPORATED 10/13/25 PO $11,279.36 RATE INCREASE RE-PRINTING & RE-MAILING SERVICES OMNI GRAPHICS 10/21/25 PO $1,709.94 RMA 3G XTR ENCODERS MASTER METER INC 21 Water Purchases: • Potable Water Purchases – The September potable water purchases were 2,724 acre-feet which is 6.6% below the budget of 2,917 acre-feet. Cumulative purchases for the year are 8,614 acre-feet, 0.9% below the year-to-date budget of 8,692 acre-feet. • Recycled Water Purchases – The recycled water purchases from the City of San Diego and production at the District’s treatment facility for the month of September were 454 acre-feet which is 7.4% below the budget of 490 acre-feet. Cumulative purchases and production for the year are 1,304 acre-feet, 11.3% below the year-to-date budget of 1,470 acre-feet. 22 • The table below displays the year-to-date and monthly rainfall data for September. Rainfall September Y-T-D Actual 0.46 0.51 3-year Historical Average 0.24 0.03 Variance 0.22 91.7% 0.48 88.9% Potable, Recycled, and Sewer (Reporting up to the month of September): • Total number of potable water meters: 52,105. • Total number of sewer connections: 4,756. • Recycled water consumption for the month of September: o Total consumption: 471.90 acre-feet or 153,758,880 gallons. o Average daily consumption: 5,125,296 gallons per day. o Total cumulative recycled water consumption since September 2024: 1,464.20 acre-feet. o Total number of recycled water meters: 811. • Wastewater flows for the month of September: o Total basin flow: 1,569,500 gallons per day.  This is a decrease of 4.4 percent from September 2024. o Spring Valley Sanitation District flows to Metro: 524,763 gallons per day. o Total Otay flow: 1,044,700 gallons per day. o Flow processed at the Ralph W. Chapman Water Recycling Facility: 1,027,000 gallons per day. o Flow to Metro from Otay Water District: 17,700 gallons per day. o By the end of September there were 6,761 wastewater EDUs. Exhibit A FOR THE PERIOD ENDING SEPTEMBER 30, 2025 Annual YTD REVENUES:Budget Actual Budget Variance Var % Potable Water Sales 81,546,000$ 23,661,795 24,653,450 (991,655) (4.0%) Recycled Water Sales 11,620,000 4,367,712 4,415,700 (47,988) (1.1%) Potable Energy Charges 4,236,000 1,341,032 1,412,000 (70,968) (5.0%) Potable System Charges 15,518,000 3,722,991 3,729,900 (6,909) (0.2%) Potable MWD & CWA Fixed Charges 18,695,000 4,386,264 4,410,000 (23,736) (0.5%) Potable Penalties and Other Fees 1,200,000 335,430 370,200 (34,770) (9.4%) Total Water Sales 132,815,000 37,815,224 38,991,250 (1,176,026) (3.0%) Sewer Charges 3,564,000 873,083 866,400 6,683 0.8% Meter Fees 80,000 15,169 20,100 (4,931) (24.5%) Capacity Fee Revenues 3,278,000 714,687 819,600 (104,913) (12.8%) Non-Operating Revenues 2,618,900 542,912 608,000 (65,088) (10.7%) Tax Revenues 6,854,000 236,854 211,100 25,754 12.2% Interest 898,000 287,685 224,400 63,285 28.2% Total Revenues 150,107,900$ 40,485,614 41,740,850 (1,255,236) (3.0%) EXPENSES: Potable Water Purchases 58,785,000$ 17,242,447 17,349,600 107,153 0.6% Recycled Water Purchases 7,272,000 2,532,200 2,532,200 - 0.0% CWA-Fixed Transportation Charge 2,731,000 549,089 573,000 23,911 4.2% CWA-Infrastructure Access Charge 3,288,000 788,798 822,000 33,202 4.0% CWA-Customer Service Charge 2,388,000 549,089 573,000 23,911 4.2% CWA-Reliability Charge 4,326,000 937,509 1,068,000 130,491 12.2% CWA-Emergency Storage Charge 5,502,000 1,252,213 1,305,000 52,787 4.0% MWD-Capacity Res Charge 1,092,000 247,381 258,000 10,619 4.1% MWD-Readiness to Serve Charge 648,000 170,629 162,000 (8,629) (5.3%) Subtotal Water Purchases 86,032,000 24,269,355 24,642,800 373,445 1.5% Power Charges 4,643,000 1,305,591 1,459,400 153,809 10.5% Payroll & Related Costs 29,796,300 7,404,751 7,835,100 430,349 5.5% Materials & Maintenance 5,476,200 1,237,487 1,370,000 132,513 9.7% Administrative Expenses 10,688,700 2,202,250 2,666,400 464,150 17.4% Legal Fees 1,180,000 770,470 294,900 (475,570) (161.3%) Expansion Reserve 1,477,700 369,400 369,400 - 0.0% Betterment Reserve 9,076,000 2,269,000 2,269,000 - 0.0% OPEB Trust 671,000 167,800 167,800 - 0.0% General Fund Reserve 1,067,000 266,800 266,800 - 0.0% Total Expenses 150,107,900$ 40,262,904 41,341,600 1,078,696 2.6% EXCESS REVENUES(EXPENSES)-$ 222,710 399,250 (176,540) OTAY WATER DISTRICT COMPARATIVE BUDGET SUMMARY F:/MORPT/FS2026-P3 Sep25 10/23/2025 10:12 AM The year-to-date excess revenue of $222,710 is $176,540 lower than the budgeted excess revenues of $399,250. The negative variance is driven by overall lower sales volumes due to lower than average temperatures and above-average precipitation. COMPARATIVE BUDGET SUMMARY NET REVENUE AND EXPENSES FOR THE PERIOD ENDING SEPTEMBER 30, 2025 -$1,000,000 -$800,000 -$600,000 -$400,000 -$200,000 $0 $200,000 $400,000 $600,000 $800,000 $1,000,000 $1,200,000 JUL AUG SEP OCT NOV DEC JAN FEB MAR APR MAY JUN YTD Actual Net Revenues YTD Budget Net Revenues YTD Variance in Net Revenues OTAY WATER DISTRICT INVESTMENT PORTFOLIO REVIEW September 30, 2025 INVESTMENT OVERVIEW & MARKET STATUS: At the Federal Reserve Board's regular meeting on September 17, 2025, the Committee decided to lower the target range for the federal funds rate from 4.25-4.50% to 4.00%-4.25%, in support of its goals and considering the shift in the balance of risks. At that meeting, the Committee felt economic activity moderated in the first half of the year. The Committee will evaluate the risk balance, outlook, and incoming data prior to making any modifications to the federal funds target range. It is intended to support employment and restore inflation to its 2% objective by decreasing Treasury securities and agency debt. The Committee will continue to observe the effects of incoming information on the economic outlook. In determining the timing and size of future adjustments to the target range for the federal funds rate, they went on to say: "The Committee would be prepared to adjust the stance of monetary policy as appropriate if risks emerge that could impede the attainment of the Committee's goals. The Committee's assessments will take into account a wide range of information, including readings on labor market conditions, inflation pressures and inflation expectations, and financial and international developments." The District's effective rate of return for September 2025 was 4.02%, which was two basis points higher than the previous month. LAIF's return was four basis points lower than last month with an average effective yield of 4.21% for September 2025. The District has maintained a competitive long-term rate of return on the portfolio. The current investment strategy includes an increased level of liquidity above historical levels to meet anticipated higher liquidity requirements. As part of the District’s continued strategy, staff continuously monitors investment options and liquidity needs. Currently no changes in investment strategy are being considered based on a competitive rate of return and increased liquidity requirements Under the District's Investment Policy, all District funds continue to be managed based on the objectives, in priority order, of safety, liquidity, and return on investment. PORTFOLIO COMPLIANCE: September 30, 2025 Investment State Limit Otay Limit Otay Actual 8.01: Treasury Securities 100% 100% 14.08% 8.02: Local Agency Investment Fund (Operations) $75 Million $75 Million $62.75 Million 8.03: Federal Agency Issues 100% 100% 15.05% 8.04: Certificates of Deposit 30% 15% 0 8.05: Short-Term Commercial Notes 25% 10% 0 8.06: Medium-Term Commercial Debt 30% 10% 0 8.07: Money Market Mutual Funds 20% 10% 6.86% 8.08: San Diego County Pool 100% 100% 0.11% 12.0: Maximum Single Financial Institution 100% 50% 2.82% $2,900,757 2.82% $62,862,928 61.19% $36,978,406 35.99% Otay Water District Investment Portfolio: 09/30/2025 Banks (Passbook/Checking/CD)Pools (LAIF & County)Agencies,Treasury Securities & Money Market Mutual Funds Total Cash and Investments: $102,742,091 (Book Value) Jul FY25 Aug FY25 Sep FY25 1st Qtr FY25 Oct FY25 Nov FY25 Dec FY25 2nd Qtr FY25 Jan FY25 Feb FY25 Mar FY25 3rd Qtr FY25 Apr FY25 May FY25 Jun FY25 4th Qtr FY25 Jul FY26 Aug FY26 Sep FY26 1st Qtr FY26 Otay 4.13 4.21 4.23 4.19 4.16 4.16 4.08 4.13 4.10 4.37 4.11 4.19 4.10 4.08 4.10 4.09 4.05 4.00 4.02 4.02 LAIF 4.52 4.58 4.58 4.56 4.52 4.48 4.43 4.48 4.37 4.33 4.31 4.34 4.29 4.27 4.27 4.28 4.26 4.25 4.21 4.24 Difference -0.39 -0.37 -0.35 -0.37 -0.36 -0.32 -0.35 -0.34 -0.27 0.04 -0.20 -0.14 -0.19 -0.19 -0.17 -0.19 -0.21 -0.25 -0.19 -0.22 -1.00 0.00 1.00 2.00 3.00 4.00 5.00 Re t u r n o n I n v e s t m e n t s Month Performance Measure FY-26 Return on Investment Otay LAIF Difference Target: Meet or Exceed 100% of LAIF Month End Portfolio Management September 30, 2025 Portfolio Summary % of Portfolio Book ValueInvestmentsMarket Value Par Value Days to MaturityTerm YTM 360 Equiv. YTM 365 Equiv. Federal Agency Issues- Callable 8,500,000.00 7518.51 4.3114708,492,225.008,500,000.00 4.371 Treasury Securities - Coupon 14,462,957.55 40714.49 4.01220814,476,910.0014,500,000.00 4.067 Federal Agency Issues - Bullet 6,965,825.21 9436.98 3.4083056,991,930.007,000,000.00 3.456 Money Market 7,049,623.68 17.06 3.92317,049,623.687,049,623.68 3.977 Local Agency Investment Fund (LAIF)62,749,176.53 162.85 4.154162,870,256.1562,749,176.53 4.212 San Diego County Pool 113,751.20 10.11 3.7081114,000.00113,751.20 3.760 99,841,334.17 100.00%Investments 99,994,944.8399,912,551.41 189 92 4.078 4.135 Cash (not included in yield calculations) Passbook/Checking 2,900,756.61 1 1.95612,900,756.612,900,756.61 1.983 102,742,090.78Total Cash and Investments 102,895,701.44102,813,308.02 189 92 4.078 4.135 Current Year September 30 333,885.93 Fiscal Year To Date 1,037,188.04 Average Daily Balance Effective Rate of Return 101,077,545.34 102,306,227.61 4.02%4.02% Total Earnings Month Ending I hereby certify that the investments contained in this report are made in accordance with the District Investment Policy Number 27 adopted by the Board of Directors on May 07, 2025. The investments provide sufficient liquidity to meet the cash flow requirements of the District for the next six months of expenditures. __________________________________________________ ____________________ Joe Beachem, Chief Financial Officer Portfolio OTAY NL! APData Updated: SET_PM1: 10/21/2025 09:50 Reporting period 09/01/2025-09/30/2025 Run Date: 10/21/2025 - 09:50 PM (PRF_PM1) 7.3.11 Report Ver. 7.3.11 10/23/2025 YTM 360 Page 1 Par Value Book Value Maturity Date Stated RateMarket Value September 30, 2025 Portfolio Details - Investments Average BalanceIssuer Portfolio Management Month End Days to MaturityMoody'sCUSIP Investment # Purchase Date Federal Agency Issues- Callable 4.468Federal Home Loan Bank2422 1,000,000.00 1,000,000.00 05/10/20274.53011/15/2024 999,500.00 Aa13130B3R54 586 4.290Federal Home Loan Bank2425 7,500,000.00 7,500,000.00 12/30/20264.35012/30/2024 7,492,725.00 Aa13130B4DY4 455 8,500,000.008,492,225.008,500,000.008,500,000.00Subtotal and Average 4.311 470 Treasury Securities - Coupon 4.110US TREASURY2426 7,500,000.00 7,501,485.25 12/31/20254.25001/06/2025 7,505,250.00 Aa191282CJS1 91 4.143US TREASURY2427 1,000,000.00 990,638.97 03/31/20262.25002/05/2025 992,270.00 Aa19128286L9 181 4.034US TREASURY2428 1,000,000.00 991,147.74 03/31/20262.25003/27/2025 992,270.00 Aa19128286L9 181 3.897US TREASURY2429 1,000,000.00 1,001,158.35 06/15/20264.12504/25/2025 1,002,320.00 Aa191282CHH7 257 4.016US TREASURY2430 1,000,000.00 994,484.85 09/30/20263.50005/23/2025 997,890.00 Aa191282CLP4 364 3.977US TREASURY2431 1,000,000.00 997,472.91 08/31/20263.75006/13/2025 1,000,030.00 Aa191282CLH2 334 3.728US TREASURY2433 1,000,000.00 981,562.07 03/31/20272.50008/19/2025 983,130.0091282CEF4 546 3.546US TREASURY2434 1,000,000.00 1,005,007.41 01/15/20274.00009/17/2025 1,003,750.00 Aa191282CJT9 471 14,462,957.5514,476,910.0014,500,000.0013,925,009.73Subtotal and Average 4.012 208 Federal Agency Issues - Bullet 4.932Federal Farm Credit Bank2420 1,000,000.00 998,475.22 03/05/20264.62504/17/2024 1,003,290.00 Aa13133EP4K8 155 4.679Federal Farm Credit Bank2421 1,000,000.00 1,000,076.09 05/06/20274.75005/28/2024 1,016,360.00 Aa13133ERDS7 582 4.060Federal Farm Credit Bank2423 2,000,000.00 2,000,205.42 12/16/20264.12512/16/2024 2,008,460.00 Aa13133ERK42 441 3.886Federal Home Loan Bank2432 1,000,000.00 968,325.14 12/21/20261.25007/17/2025 971,240.00 Aa13130AQF65 446 1.129Federal National Mortage Assoc2394 2,000,000.00 1,998,743.34 11/07/20250.50012/15/2021 1,992,580.00 Aa13135G06G3 37 6,965,825.216,991,930.007,000,000.0012,647,600.54Subtotal and Average 3.408 305 Money Market 3.945Blackrock T - Fund Inst9010 1,066,887.61 1,066,887.61 4.0001,066,887.61RESERVE-10A WRB 1 3.945Blackrock T - Fund Inst9011 2,802,117.05 2,802,117.05 4.0002,802,117.05RESERVE 10 BABS 1 3.896FIRST AMERICAN US TREASURY9016 3,180,619.02 3,180,619.02 3.9503,180,619.02OWD TRUST & CUS 1 7,049,623.687,049,623.687,049,623.681,286,678.68Subtotal and Average 3.923 1 Local Agency Investment Fund (LAIF) 4.154STATE OF CALIFORNIA9001 62,749,176.53 62,749,176.53 4.21262,870,256.15LAIF 1 62,749,176.5362,870,256.1562,749,176.5362,549,176.53Subtotal and Average 4.154 1 San Diego County Pool 3.708San Diego County9007 113,751.20 113,751.20 3.760114,000.00SD COUNTY POOL 1 Portfolio OTAY NL! APData Updated: SET_PM1: 10/21/2025 09:50 Run Date: 10/21/2025 - 09:50 PM (PRF_PM2) 7.3.11 Report Ver. 7.3.11 YTM 360 Page 2 Par Value Book Value Stated RateMarket Value September 30, 2025 Portfolio Details - Investments Average BalanceIssuer Portfolio Management Month End Days to MaturityMoody'sCUSIP Investment # Purchase Date 113,751.20114,000.00113,751.20113,428.07Subtotal and Average 3.708 1 101,077,545.34 99,912,551.41 4.078 9299,994,944.83 99,841,334.17Total and Average Portfolio OTAY NL! APData Updated: SET_PM1: 10/21/2025 09:50 Run Date: 10/21/2025 - 09:50 PM (PRF_PM2) 7.3.11 YTM 360 Page 3 Par Value Book Value Stated RateMarket Value September 30, 2025 Portfolio Details - Cash Average BalanceIssuer Portfolio Management Month End Days to MaturityMoody'sCUSIP Investment # Purchase Date US Bank 0.000STATE OF CALIFORNIA9003 3,100.00 3,100.003,100.00PETTY CASH 1 2.022STATE OF CALIFORNIA9004 2,805,754.42 2,805,754.42 2.0502,805,754.42OPERATING 1 0.000STATE OF CALIFORNIA9005 4,554.79 4,554.7907/01/2025 4,554.79PAYROLL 1 0.000STATE OF CALIFORNIA9014 57,462.29 57,462.2907/01/2025 57,462.29FLEX ACCT 1 0.000California Bank & Trust9017 29,885.11 29,885.1102/11/1999 29,885.11GRANT FUNDS 1 0.00 101,077,545.34 102,813,308.02 4.078 92 1Average Balance 102,895,701.44 102,742,090.78Total Cash and Investments Portfolio OTAY NL! APData Updated: SET_PM1: 10/21/2025 09:50 Run Date: 10/21/2025 - 09:50 PM (PRF_PM2) 7.3.11 Month End Activity Report Sorted By Issuer September 1, 2025 - September 30, 2025 Current Rate Transaction Date BalanceBeginning Balance Ending Par Value Percent of Portfolio Par Value CUSIP Investment #Issuer Purchases or Deposits Redemptions or Withdrawals Issuer: Blackrock T - Fund Inst Money Market Blackrock T - Fund Inst9010 1,047,029.664.000 0.00RESERVE-10A WRB Blackrock T - Fund Inst9011 2,756,320.204.000 0.00RESERVE 10 BABS 0.0065,654.80 3,869,004.66Subtotal and Balance 3,803,349.86 3,803,349.86 0.0065,654.80 3,869,004.663.763%Issuer Subtotal Issuer: STATE OF CALIFORNIA US Bank STATE OF CALIFORNIA9004 1,910,218.062.050 0.00OPERATING STATE OF CALIFORNIA9005 0.00 0.03PAYROLL STATE OF CALIFORNIA9014 50,310.96 11,326.03FLEX ACCT 11,326.06921,668.54 2,870,871.50Subtotal and Balance 1,960,529.02 Local Agency Investment Fund (LAIF) STATE OF CALIFORNIA9001 8,200,000.004.212 10,200,000.00LAIF 10,200,000.0064,749,176.53 62,749,176.53Subtotal and Balance 8,200,000.00 10,160,529.02 10,211,326.0665,670,845.07 65,620,048.0363.824%Issuer Subtotal Issuer: California Bank & Trust US Bank 29,885.11 29,885.11Subtotal and Balance 0.00 0.0029,885.11 29,885.110.029%Issuer Subtotal Issuer: FIRST AMERICAN US TREASURY Money Market FIRST AMERICAN US TREASURY9016 4,158,336.833.950 1,012,112.77OWD TRUST & CUS 1,012,112.7734,394.96 3,180,619.02Subtotal and Balance 4,158,336.83 Portfolio OTAY NL! APData Updated: SET_PM1: 10/21/2025 09:50 Run Date: 10/21/2025 - 09:50 DA (PRF_DA) 7.3.11 Report Ver. 7.3.11 Current Rate Transaction Date BalanceBeginning Balance Ending Par Value Page 2 Percent of Portfolio Par Value September 1, 2025 - September 30, 2025 Activity Report Month End CUSIP Investment #Issuer Purchases or Deposits Redemptions or Withdrawals 4,158,336.83 1,012,112.7734,394.96 3,180,619.023.094%Issuer Subtotal Issuer: Federal Farm Credit Bank Federal Agency Issues - Bullet Federal Farm Credit Bank2402 0.004.250 09/30/2025 3,000,000.003133ENP95 3,000,000.007,000,000.00 4,000,000.00Subtotal and Balance 0.00 0.00 3,000,000.007,000,000.00 4,000,000.003.891%Issuer Subtotal Issuer: Federal Home Loan Bank Federal Agency Issues- Callable 8,500,000.00 8,500,000.00Subtotal and Balance Federal Agency Issues - Bullet 1,000,000.00 1,000,000.00Subtotal and Balance 0.00 0.009,500,000.00 9,500,000.009.240%Issuer Subtotal Issuer: Federal Home Loan Mortgage Federal Agency Issues - Bullet Federal Home Loan Mortgage2391 0.000.375 09/23/2025 1,045,000.003137EAEX3 Federal Home Loan Mortgage2392 0.000.375 09/23/2025 2,751,000.003137EAEX3 3,796,000.003,796,000.00 0.00Subtotal and Balance 0.00 0.00 3,796,000.003,796,000.00 0.000.000%Issuer Subtotal Issuer: Federal National Mortage Assoc Federal Agency Issues - Bullet 2,000,000.00 2,000,000.00Subtotal and Balance 0.00 0.002,000,000.00 2,000,000.001.945%Issuer Subtotal Issuer: San Diego County San Diego County Pool San Diego County9007 756.943.760 410.73SD COUNTY POOL Portfolio OTAY NL! APData Updated: SET_PM1: 10/21/2025 09:50 Run Date: 10/21/2025 - 09:50 DA (PRF_DA) 7.3.11 Report Ver. 7.3.11 Current Rate Transaction Date BalanceBeginning Balance Ending Par Value Page 3 Percent of Portfolio Par Value September 1, 2025 - September 30, 2025 Activity Report Month End CUSIP Investment #Issuer Purchases or Deposits Redemptions or Withdrawals 410.73113,404.99 113,751.20Subtotal and Balance 756.94 756.94 410.73113,404.99 113,751.200.111%Issuer Subtotal Issuer: US TREASURY Treasury Securities - Coupon US TREASURY2434 1,000,000.004.000 09/17/2025 0.0091282CJT9 0.0013,500,000.00 14,500,000.00Subtotal and Balance 1,000,000.00 1,000,000.00 0.0013,500,000.00 14,500,000.0014.103%Issuer Subtotal 101,710,184.93 102,813,308.02Total18,019,849.5619,122,972.65100.000% Portfolio OTAY NL! APData Updated: SET_PM1: 10/21/2025 09:50 Run Date: 10/21/2025 - 09:50 DA (PRF_DA) 7.3.11 Report Ver. 7.3.11 Month End Duration Report Sorted by Investment Type - Investment Type Through 09/30/2025 Investment #Security ID Issuer Investment Class Book Value Par Value Market Value Current Rate YTM Current Yield Maturity/ Call Date DurationModified360Fund Federal Home Loan Bank242299 1,000,000.00 999,500.003130B3R54 4.565 05/10/2027 1.5081,000,000.00 4.468Fair4.5300000 Federal Home Loan Bank242599 7,500,000.00 7,492,725.003130B4DY4 4.436 12/30/2026 1.1897,500,000.00 4.290Fair4.3500000 US TREASURY242699 7,500,000.00 7,505,250.0091282CJS1 3.855 12/31/2025 0.2497,501,485.25 4.110Fair4.2500000 US TREASURY242799 1,000,000.00 992,270.009128286L9 3.845 03/31/2026 0.495990,638.97 4.143Fair2.2500000 US TREASURY242899 1,000,000.00 992,270.009128286L9 3.845 03/31/2026 0.495991,147.74 4.034Fair2.2500000 US TREASURY242999 1,000,000.00 1,002,320.0091282CHH7 3.795 06/15/2026 0.6811,001,158.35 3.897Fair4.1250000 US TREASURY243099 1,000,000.00 997,890.0091282CLP4 3.717 09/30/2026 0.970994,484.85 4.016Fair3.5000000 US TREASURY243199 1,000,000.00 1,000,030.0091282CLH2 3.749 08/31/2026 0.888997,472.91 3.977Fair3.7500000 US TREASURY243399 1,000,000.00 983,130.0091282CEF4 3.666 03/31/2027 1.451981,562.07 3.728Fair2.5000000 US TREASURY243499 1,000,000.00 1,003,750.0091282CJT9 3.703 01/15/2027 1.2351,005,007.41 3.546Fair4.0000000 Federal National Mortage Assoc239499 2,000,000.00 1,992,580.003135G06G3 4.117 11/07/2025 0.1011,998,743.34 1.129Fair.50000000 Federal Farm Credit Bank242099 1,000,000.00 1,003,290.003133EP4K8 3.836 03/05/2026 0.424998,475.22 4.932Fair4.6250000 Federal Farm Credit Bank242199 1,000,000.00 1,016,360.003133ERDS7 3.688 05/06/2027 1.5011,000,076.09 4.679Fair4.7500000 Federal Farm Credit Bank242399 2,000,000.00 2,008,460.003133ERK42 3.767 12/16/2026 1.1562,000,205.42 4.060Fair4.1250000 Federal Home Loan Bank243299 1,000,000.00 971,240.003130AQF65 3.679 12/21/2026 1.190968,325.14 3.886Fair1.2500000 Blackrock T - Fund Inst901099 1,066,887.61 1,066,887.61RESERVE-10A 4.000 0.0001,066,887.61 3.945Amort4.0000000 Blackrock T - Fund Inst901199 2,802,117.05 2,802,117.05RESERVE 10 4.000 0.0002,802,117.05 3.945Amort4.0000000 FIRST AMERICAN US TREASURY901699 3,180,619.02 3,180,619.02OWD TRUST &3.950 0.0003,180,619.02 3.896Amort3.9500000 STATE OF CALIFORNIA900199 62,749,176.53 62,870,256.15LAIF 4.212 0.00062,749,176.53 4.154Fair4.2120000 San Diego County900799 113,751.20 114,000.00SD COUNTY 3.760 0.000113,751.20 3.708Fair3.7600000 4.132 0.24199,841,334.17 99,912,551.41 99,994,944.83Report Total † = Duration can not be calculated on these investments due to incomplete Market price data. Portfolio OTAY NL! APPage 1Data Updated: SET_PM1: 10/21/2025 09:50 Run Date: 10/21/2025 - 09:50 DU (PRF_DU) 7.3.11 Report Ver. 7.3.11 Month End GASB 31 Compliance Detail Sorted by Fund - Fund September 1, 2025 - September 30, 2025 Investment #Maturity Date Beginning Invested Value Purchase of Principal InvestmentClassFundCUSIP Adjustment in Value Ending Invested Value Addition to Principal Redemption of Principal Amortization Adjustment Change in Market Value Fund: Treasury Fund 2391 1,042,617.40Fair Value 09/23/2025 2,382.6099 0.003137EAEX30.00 0.00 1,045,000.00 0.00 2392 2,744,727.72Fair Value 09/23/2025 6,272.2899 0.003137EAEX30.00 0.00 2,751,000.00 0.00 2394 1,986,540.00Fair Value 11/07/2025 6,040.0099 1,992,580.003135G06G30.00 0.00 0.00 0.00 2432 968,050.00Fair Value 12/21/2026 3,190.0099 971,240.003130AQF650.00 0.00 0.00 0.00 2425 7,490,325.00Fair Value 12/30/2026 2,400.0099 7,492,725.003130B4DY40.00 0.00 0.00 0.00 2422 998,900.00Fair Value 05/10/2027 600.0099 999,500.003130B3R540.00 0.00 0.00 0.00 9014 18,477.36Amortized 0.0099 57,462.29FLEX ACCT 0.00 50,310.96 11,326.03 0.00 9004 895,536.36Amortized 0.0099 2,805,754.42OPERATING0.00 1,910,218.06 0.00 0.00 9003 3,100.00Amortized 0.0099 3,100.00PETTY CASH 0.00 0.00 0.00 0.00 9005 4,554.82Amortized 0.0099 4,554.79PAYROLL0.00 0.00 0.03 0.00 9001 64,826,766.12Fair Value 43,490.0399 62,870,256.15LAIF0.00 8,200,000.00 10,200,000.00 0.00 2402 2,999,640.00Fair Value 09/30/2025 360.0099 0.003133ENP950.00 0.00 3,000,000.00 0.00 2421 1,014,640.00Fair Value 05/06/2027 1,720.0099 1,016,360.003133ERDS70.00 0.00 0.00 0.00 2420 1,003,440.00Fair Value 03/05/2026 -150.0099 1,003,290.003133EP4K80.00 0.00 0.00 0.00 2423 2,005,920.00Fair Value 12/16/2026 2,540.0099 2,008,460.003133ERK420.00 0.00 0.00 0.00 9017 29,885.11Amortized 0.0099 29,885.11GRANT FUNDS 0.00 0.00 0.00 0.00 2430 996,290.00Fair Value 09/30/2026 1,600.0099 997,890.0091282CLP40.00 0.00 0.00 0.00 2431 998,800.00Fair Value 08/31/2026 1,230.0099 1,000,030.0091282CLH20.00 0.00 0.00 0.00 2434 0.00Fair Value 01/15/2027 -1,406.2599 1,003,750.0091282CJT91,005,156.25 0.00 0.00 0.00 2429 1,001,420.00Fair Value 06/15/2026 900.0099 1,002,320.0091282CHH70.00 0.00 0.00 0.00 2433 981,720.00Fair Value 03/31/2027 1,410.0099 983,130.0091282CEF40.00 0.00 0.00 0.00 2427 989,970.00Fair Value 03/31/2026 2,300.0099 992,270.009128286L90.00 0.00 0.00 0.00 2428 989,970.00Fair Value 03/31/2026 2,300.0099 992,270.009128286L90.00 0.00 0.00 0.00 2426 7,502,175.00Fair Value 12/31/2025 3,075.0099 7,505,250.0091282CJS10.00 0.00 0.00 0.00 9007 117,000.00Fair Value -3,346.2199 114,000.00SD COUNTY POOL 0.00 756.94 410.73 0.00 9016 34,394.96Amortized 0.0099 3,180,619.02OWD TRUST & CUS 0.00 4,158,336.83 1,012,112.77 0.00 9011 45,796.85Amortized 0.0099 2,802,117.05RESERVE 10 BABS 0.00 2,756,320.20 0.00 0.00 9010 19,857.95Amortized 0.0099 1,066,887.61RESERVE-10A WRB 0.00 1,047,029.66 0.00 0.00 101,710,514.65Subtotal 76,907.45 102,895,701.441,005,156.25 18,122,972.65 18,019,849.56 0.00 101,710,514.65Total 102,895,701.4476,907.451,005,156.25 18,122,972.65 18,019,849.56 0.00 Portfolio OTAY NL! APData Updated: SET_PM1: 10/21/2025 10:20 Run Date: 10/21/2025 - 10:21 GD (PRF_GD) 7.3.11 Report Ver. 7.3.11 Month End Interest Earnings Sorted by Fund - Fund September 1, 2025 - September 30, 2025 Yield on Beginning Book Value Maturity Date Current Rate Ending Par Value EndingSecurityTypeFundBook ValueBeginningBook Value Adjusted Interest Earnings Accretion Amortization/ Earnings Adjusted InterestAnnualized YieldCUSIPInvestment #Interest Earned Fund: Treasury Fund 0.0023910.00 0.375FAC09/23/2025 239.48 154.91 394.390.626991,044,845.093137EAEX3 0.0023920.00 0.375FAC09/23/2025 630.44 416.22 1,046.660.631992,750,583.783137EAEX3 1,998,743.3423942,000,000.00 0.500FAC11/07/2025 833.33 1,047.22 1,880.551.145991,997,696.123135G06G3 968,325.1424321,000,000.00 1.250FAC12/21/2026 1,041.66 2,159.65 3,201.314.03199966,165.493130AQF65 7,500,000.0024257,500,000.00 4.350MC112/30/2026 27,187.50 0.00 27,187.504.410997,500,000.003130B4DY4 1,000,000.0024221,000,000.00 4.530MC105/10/2027 3,775.00 0.00 3,775.004.593991,000,000.003130B3R54 57,462.29901457,462.29PA1 0.00 0.00 0.009918,477.36FLEX ACCT 2,805,754.4290042,805,754.42 2.050PA1 3,350.38 0.00 3,350.384.55299895,536.36OPERATING 3,100.0090033,100.00PA1 0.00 0.00 0.00993,100.00PETTY CASH 4,554.7990054,554.79PA1 0.00 0.00 0.00994,554.82PAYROLL 62,749,176.53900162,749,176.53 4.212LA1 216,540.11 0.00 216,540.114.0699964,749,176.53LAIF 0.0024020.00 4.250FAC09/30/2025 10,270.83 157.08 10,427.914.375992,999,842.923133ENP95 1,000,076.0924211,000,000.00 4.750FAC05/06/2027 3,958.33 -3.97 3,954.364.811991,000,080.063133ERDS7 998,475.2224201,000,000.00 4.625FAC03/05/2026 3,854.17 297.04 4,151.215.06099998,178.183133EP4K8 2,000,205.4224232,000,000.00 4.125FAC12/16/2026 6,875.00 -14.16 6,860.844.173992,000,219.583133ERK42 29,885.11901729,885.11PA1 0.00 0.00 0.009929,885.11GRANT FUNDS 994,484.8524301,000,000.00 3.500TRC09/30/2026 2,869.37 454.55 3,323.924.06899994,030.3091282CLP4 997,472.9124311,000,000.00 3.750TRC08/31/2026 3,107.74 226.99 3,334.734.06899997,245.9291282CLH2 1,005,007.4124341,000,000.00 4.000TRC01/15/2027 1,521.74 -148.84 1,372.903.561990.0091282CJT9 1,001,158.3524291,000,000.00 4.125TRC06/15/2026 3,381.15 -135.22 3,245.933.944991,001,293.5791282CHH7 981,562.0724331,000,000.00 2.500TRC03/31/2027 2,049.55 1,013.07 3,062.623.80099980,549.0091282CEF4 990,638.9724271,000,000.00 2.250TRC03/31/2026 1,844.60 1,551.55 3,396.154.17899989,087.429128286L9 991,147.7424281,000,000.00 2.250TRC03/31/2026 1,844.60 1,467.22 3,311.824.07199989,680.529128286L9 7,501,485.2524267,500,000.00 4.250TRC12/31/2025 25,985.06 -489.64 25,495.424.135997,501,974.8991282CJS1 113,751.209007113,751.20 3.760LA3 350.54 0.00 350.543.76199113,404.99SD COUNTY POOL 3,180,619.0290163,180,619.02 3.950PA2 670.85 0.00 670.8523.7309934,394.96OWD TRUST & CUS 2,802,117.0590112,802,117.05 4.000PA2 2,567.44 0.00 2,567.4468.2089945,796.85RESERVE 10 BABS 1,066,887.6190101,066,887.61 4.000PA2 983.39 0.00 983.3960.2519919,857.95RESERVE-10A WRB 102,813,308.02Subtotal 102,742,090.78 3.954 333,885.938,153.67325,732.26101,625,657.77 Portfolio OTAY NL! APData Updated: SET_PM1: 10/21/2025 09:50 Run Date: 10/21/2025 - 09:50 IE (PRF_IE) 7.3.11 Report Ver. 7.3.11 Maturity Date Current Rate Ending Par Value EndingSecurityTypeFund Page 2 Book ValueBeginningBook Value Adjusted Interest Earnings Accretion Amortization/ Earnings Adjusted Interest September 1, 2025 - September 30, 2025 Interest Earnings Month End Annualized YieldCUSIPInvestment #Interest Earned 102,813,308.02Total 102,742,090.78 3.954 333,885.938,153.67325,732.26101,625,657.77 Portfolio OTAY NL! APData Updated: SET_PM1: 10/21/2025 09:50 Run Date: 10/21/2025 - 09:50 IE (PRF_IE) 7.3.11 Report Ver. 7.3.11 SUMMARY FOR PERIOD 9/18/2025 - 10/22/2025 NET DEMANDS CHECKS (2064546 - 2064734)$ 2,661,150.14 VOID CHECKS (0)$ 0.00 TOTAL CHECKS $ 2,661,150.14 WIRE TO: $ 600.00 $ 560.00 $ 78,975.59 $ 5,292,854.45 $ 438,061.38 $ 380,846.69 $ 1,383.04 $ 17,961.50 $ 500.00 AUL HEALTH BENEFIT TRUST - HRA EMP SHARE PPE 092125 AUL HEALTH BENEFIT TRUST - HRA EMP SHARE PPE 100525 CALPERS - CERBT CONTRIBUTION CITY OF CHULA VISTA - BI-MONTHLY SEWER CHARGES - JULY AND AUG 2025 CITY TREASURER - RECLAIMED WATER - AUG 2025 CITY TREASURER - RECLAIMED WATER - SEPT 2025 DELTA DENTAL OF CALIFORNIA - DELTA DENTAL ADMIN SERV - SEPT 2025 DELTA DENTAL OF CALIFORNIA - DELTA DENTAL CLAIMS - SEPT 2025 MIDAMERICA ADMINISTRATIVE - HRA ADMIN FEE MIDAMERICA ADMINISTRATIVE - HRA EMPLOYEE CONTRIBUTION - CLASS B $ 4,751.15 OTAY WATER DISTRICT - BI-WEEKLY PAYROLL DEDUCTION $ 1,365.00 OTAY WATER DISTRICT - BI-WEEKLY PAYROLL DEDUCTION $ 1,380.00 OTAY WATER DISTRICT - BI-WEEKLY PAYROLL DEDUCTION $ 1,365.00 PUBLIC EMPLOYEES RET SYSTEM - BI-WEEKLY PERS CONTRIBUTION $ 135,663.58 PUBLIC EMPLOYEES RET SYSTEM - BI-WEEKLY PERS CONTRIBUTION $ 136,573.43 PUBLIC EMPLOYEES RET SYSTEM - BI-WEEKLY PERS CONTRIBUTION $ 136,982.18 $ 5,960,654.80 $ 477,004.33 SAN DIEGO COUNTY WATER AUTH - WATER DELIVERIES AND CHARGES - AUG 2025 SPECIAL DISTRICT RISK - EMPLOYEE MEDICAL BENEFITS - OCT 2025 SPECIAL DISTRICT RISK - EMPLOYEE MEDICAL BENEFITS - NOV 2025 US BANK - BI-WEEKLY PAYROLL TAXES $ 480,523.84 $ 203,429.76 PURPOSE: Attached is the list of demands for the Board's information. FISCAL IMPACT: STAFF REPORT TYPE MEETING: SUBMITTED BY: APPROVED BY: APPROVED BY: SUBJECT: Regular Board Jon Ravaglioli, Finance Manager, Treasury & Accounting Services Joseph Beachem, Chief Financial Officer Jose Martinez, General Manager Accounts Payable Demands List MEETING DATE: W.O./G.F. NO:DIV. NO. November 5, 2024 Docusign Envelope ID: 11866C80-2F63-416C-8C40-E7760B2EBA50 US BANK - BI-WEEKLY PAYROLL TAXES $ 217,050.34 US BANK - P CARD REIMBURSEMENT - SEPT 2025 $ 272,852.28 US BANK - BI-WEEKLY PAYROLL TAXES $ 204,388.49 US BANK - BI-WEEKLY PAYROLL TAXES $ 1,691.28 VOYA FINANCIAL - BI-WEEKLY 401A & 457 PLAN $ 38,213.01 VOYA FINANCIAL - BI-WEEKLY 401A & 457 PLAN $ 38,571.36 VOYA FINANCIAL - BI-WEEKLY 401A & 457 PLAN $ 38,259.22 TOTAL CASH DISBURSEMENTS $ 17,223,611.84 RECOMMENDED ACTION: That the Board received the attached list of demands. Jb/Attachment Docusign Envelope ID: 11866C80-2F63-416C-8C40-E7760B2EBA50 Check Num Check Amt Invoice Description Invoice Total Check Dt Vendor Num Invoice Num 2064658 39.13 CLOUD BACKUP FOR MICROSOFT 365 39.13 10/15/2025 30371 71254317 2064697 663.56 ELEVATOR GENERAL MAINTENANCE 663.56 10/22/2025 15416 201268 2064628 7,523.84 CLIMATE ADAPTATION & RESILIENCE 7,523.84 10/8/2025 22463 20256065 2064659 3,528.51 CLIMATE ADAPTATION & RESILIENCE 3,528.51 10/15/2025 22463 20256084 2064629 75.00 FY26 SHAREPOINT & INTRANET SUPP 75.00 10/8/2025 8488 13264 2064563 1,353.06 INTERNET CIRCUITS (8/11/25-9/10/25)1,353.06 10/1/2025 18122 1832337017 AS-NEEDED AQUA AMMONIA DELIVERY 545.05 10/1/2025 7732 9164656010 AS-NEEDED AQUA AMMONIA DELIVERY 1,409.10 10/1/2025 7732 9164656005 AS-NEEDED AQUA AMMONIA DELIVERY 604.45 10/15/2025 7732 9165304967 AS-NEEDED AQUA AMMONIA DELIVERY 1,417.35 10/15/2025 7732 9165304951 AS-NEEDED AQUA AMMONIA DELIVERY 1,949.75 10/15/2025 7732 9165304962 2064565 872.00 DATA CENTER SENSORS 872.00 10/1/2025 18296 PIN0048402 2064566 38,699.17 RETENTION/PACIFIC HYDROTECH 38,699.17 10/1/2025 22643 908312025 CY2025 BILLING ADMINISTRATION 80.00 10/8/2025 22138 914425 CY2025 BILLING ADMINISTRATION 218.40 10/8/2025 22138 916599 2064719 17.53 UB REFUND 0000186658 17.53 10/22/2025 99999 ubRef102325003 2064546 267,106.61 PROF SERV - AUG 2025 267,106.61 9/24/2025 17264 310316 2064567 3,714.22 TELEPHONE SERV (8/12/25-9/11/25)3,714.22 10/1/2025 7785 000024048126 2064661 3,649.70 EXPENSE REIMBURSEMENT - AT&T CLAIM 3,649.70 10/15/2025 5758 PACBCS202506 0R0007 2064568 4,067.00 ARCGIS GEOMETRIC TO UTILITY 4,067.00 10/1/2025 22237 00000470638 2064662 23,937.40 ARCGIS GEOMETRIC TO UTILITY 23,937.40 10/15/2025 22237 000000474886 2064663 8,924.60 FY26 JANITORIAL SERVICES 8,924.60 10/15/2025 20125 J2164 2064664 1,649.15 ORION ENDPOINTS 1,532.49 10/15/2025 586 1761191 AS-NEEDED SODIUM HYPOCHLORITE 304.10 10/1/2025 30350 BPI544298 AS-NEEDED SODIUM HYPOCHLORITE 580.50 10/1/2025 30350 BPI548110 AS-NEEDED SODIUM HYPOCHLORITE 740.44 10/1/2025 30350 BPI546362 AS-NEEDED SODIUM HYPOCHLORITE 755.25 10/1/2025 30350 BPI544299 AS-NEEDED SODIUM HYPOCHLORITE 888.53 10/1/2025 30350 BPI544300 AS-NEEDED SODIUM HYPOCHLORITE 1,184.70 10/1/2025 30350 BPI544297 AS-NEEDED SODIUM HYPOCHLORITE 1,392.03 10/1/2025 30350 BPI548106 AS-NEEDED SODIUM HYPOCHLORITE 2,176.89 10/1/2025 30350 BPI548111 BADGER METER INC 10/2/2025 BRENNTAG PACIFIC INC 2064569 47,096.93 8/28/2025 9/11/2025 9/4/2025 8/28/2025 8/28/2025 8/28/2025 9/11/2025 9/11/2025 AXIM GEOSPATIAL LLC 9/11/2025 10/1/2025 AZTEC LANDSCAPING INC 9/30/2025 ARLIEZL VELEZ 10/21/2025 ARTIANO SHINOFF ABED 9/11/2025 AT&T 9/12/2025 10/14/2025 ALBIREO ENERGY LLC 9/5/2025 AMERICAN BUSINESS BANK 9/11/2025 AMERIFLEX 2064630 298.40 10/2/2025 10/2/2025 ABLEFORCE INC 10/3/2025 ACC BUSINESS 9/11/2025 AIRGAS SPECIALTY PRODUCTS INC 2064564 1,954.15 9/8/2025 9/8/2025 2064660 3,971.55 9/29/2025 9/29/2025 9/29/2025 24 HOUR ELEVATOR INC 10/1/2025 AARC CONSULTANTS LLC 9/3/2025 10/1/2025 Check Register Check Dates: 9/18/2025 thru 10/22/2025 Payee Invoice Date 1111 SYSTEMS INC 9/11/2025 10/22/2025 9:02:37 PM Page 1 Check Register Check Dates: 9/18/2025 thru 10/22/2025 AS-NEEDED SODIUM HYPOCHLORITE 2,369.41 10/1/2025 30350 BPI544295 AS-NEEDED SODIUM HYPOCHLORITE 2,431.60 10/1/2025 30350 BPI548109 AS-NEEDED SODIUM HYPOCHLORITE 2,961.76 10/1/2025 30350 BPI545992 AS-NEEDED SODIUM HYPOCHLORITE 3,106.89 10/1/2025 30350 BPI548501 AS-NEEDED SODIUM HYPOCHLORITE 3,257.94 10/1/2025 30350 BPI545993 AS-NEEDED SODIUM HYPOCHLORITE 3,770.32 10/1/2025 30350 BPI548107 AS-NEEDED SODIUM HYPOCHLORITE 4,042.80 10/1/2025 30350 BPI544301 AS-NEEDED SODIUM HYPOCHLORITE 4,146.46 10/1/2025 30350 BPI547071 AS-NEEDED SODIUM HYPOCHLORITE 4,161.27 10/1/2025 30350 BPI548108 AS-NEEDED SODIUM HYPOCHLORITE 4,383.40 10/1/2025 30350 BPI546363 AS-NEEDED SODIUM HYPOCHLORITE 4,442.64 10/1/2025 30350 BPI544296 AS-NEEDED SODIUM HYPOCHLORITE 296.18 10/8/2025 30350 BPI550198 AS-NEEDED SODIUM HYPOCHLORITE 1,086.97 10/8/2025 30350 BPI549465 AS-NEEDED SODIUM HYPOCHLORITE 1,332.79 10/8/2025 30350 BPI549463 AS-NEEDED SODIUM HYPOCHLORITE 1,406.84 10/8/2025 30350 BPI549462 AS-NEEDED SODIUM HYPOCHLORITE 3,554.11 10/8/2025 30350 BPI549464 AS-NEEDED SODIUM HYPOCHLORITE 3,850.29 10/8/2025 30350 BPI549466 AS-NEEDED SODIUM HYPOCHLORITE 177.71 10/15/2025 30350 BPI551272 AS-NEEDED SODIUM HYPOCHLORITE 364.29 10/15/2025 30350 BPI551270 AS-NEEDED SODIUM HYPOCHLORITE 1,172.85 10/15/2025 30350 BPI551269 AS-NEEDED SODIUM HYPOCHLORITE 1,294.29 10/15/2025 30350 BPI551271 AS-NEEDED SODIUM HYPOCHLORITE 1,412.76 10/15/2025 30350 BPI551267 AS-NEEDED SODIUM HYPOCHLORITE 2,443.45 10/15/2025 30350 BPI550199 AS-NEEDED SODIUM HYPOCHLORITE 2,452.34 10/15/2025 30350 BPI551266 AS-NEEDED SODIUM HYPOCHLORITE 2,843.29 10/15/2025 30350 BPI552713 AS-NEEDED SODIUM HYPOCHLORITE 3,648.89 10/15/2025 30350 BPI551268 2064698 358.15 ARMORED TRANSPORTATION SERVICE 358.15 10/22/2025 21775 13038493 2064666 12,637.50 HR/LEGAL CONSULTING SERV 12,637.50 10/15/2025 3005 350919 2064699 54,625.00 OLYMPIC PARKWAY RW PIPELINE 57,500.00 10/22/2025 18665 1109192025 2064570 37,184.65 UTILITY LOCATING SERV 37,184.65 10/1/2025 20374 CAL2336 2064547 600.00 DEBT STATEMENT 600.00 9/24/2025 2989 25090807 2064571 1,974.00 MS-ISAC MEMBERSHIP 1,974.00 10/1/2025 30406 IN2079303 2064548 6,702.40 RFWCWRF DISINFECTION SYSTEM 6,702.40 9/24/2025 15177 FB71392CAROLLO ENGINEERS INC 9/4/2025 CALBURTON INC 9/9/2025 CALIFORNIA MUNICIPAL 9/8/2025 CARAHSOFT TECHNOLOGY CORPORATION 9/17/2025 BRINKS INC 10/1/2025 BURKE WILLIAMS & SORENSEN LLP 9/26/2025 BURTECH PIPELINE INC 9/30/2025 2064631 11,527.18 9/18/2025 9/18/2025 9/18/2025 9/18/2025 9/18/2025 9/18/2025 2064665 15,809.87 9/25/2025 9/25/2025 9/25/2025 9/25/2025 9/25/2025 9/22/2025 9/22/2025 9/29/2025 9/25/2025 9/15/2025 9/4/2025 9/11/2025 8/28/2025 9/8/2025 8/28/2025 9/11/2025 9/2/2025 9/11/2025 9/5/2025 8/28/2025 10/22/2025 9:02:37 PM Page 2 Check Register Check Dates: 9/18/2025 thru 10/22/2025 2064720 106.73 UB REFUND 0000218171 106.73 10/22/2025 99999 ubRef102325005 2064632 7,425.04 505 MAIN ST 7,425.04 10/8/2025 30421 100625 D1204- 090662BACTERIOLOGICAL TESTING 350.00 10/22/2025 4119 42355 BACTERIOLOGICAL TESTING 1,600.00 10/22/2025 4119 42354 2064648 19.47 UB REFUND 0000291398 19.47 10/8/2025 99999 ubRef100925005 2064667 540.75 FY26 DATA SERVICES - REALQUEST 540.75 10/15/2025 15049 82269968 608.00 9/24/2025 184 1354081725 608.00 9/24/2025 184 5365081725 UPFP PERMIT RENEWAL 1,664.00 9/24/2025 184 5363081725 UPFP PERMIT RENEWAL 2,120.00 9/24/2025 184 5364081725 2064668 1,021.50 COUNTY EXCAVATION PERMITS 1,021.50 10/15/2025 99 DPWAROTAYM WD0625 SHUT DOWN TEST 300.00 10/22/2025 184 2003193E642960 925 SHUT DOWN TEST 750.00 10/22/2025 184 2003193E641890 925 SHUT DOWN TEST 780.00 10/22/2025 184 2003193E642920 925 SHUT DOWN TEST 1,800.00 10/22/2025 184 2003193E602350 925 SHUT DOWN TEST 1,950.00 10/22/2025 184 2003193E642900 925 2064572 21,150.00 COATING INSPECTION SERVICES 21,150.00 10/1/2025 4443 17285 ACUTEC 35 PARTS 1,162.70 10/1/2025 11797 2025-1250 ACUTEC 35 PARTS 6,606.76 10/1/2025 11797 2025-1216 2064702 7,150.00 AUDITING SERVICES FY25 FINANCIALS 7,150.00 10/22/2025 21128 3512 2064721 73.34 UB REFUND 0000274763 73.34 10/22/2025 99999 ubRef102325006 EXP REIMBURSEMENT - AUG 2025 35.00 10/8/2025 30035 082825 MILEAGE REIMBURSEMENT - AUG 2025 65.80 10/8/2025 30035 080125083125 2064551 6,769.58 SERV FOR COTTONWOOD LS BYPASS 6,769.58 9/24/2025 30349 0006424876 2064669 8.71 EMP FY26 QTR 1 093025 8.71 10/15/2025 21100 870440 093025 2064552 1,500.00 FY26 AUTODESK SOFTWARE LICENSE 1,500.00 9/24/2025 15084 SI704971 2064634 8,830.00 DRYLET AQUA 8,830.00 10/8/2025 18983 3506DRYLET INC 9/17/2025 DIAMOND ENVIRONMENTAL SERVICES LP 9/4/2025 DIVISION OF EMPLOYMENT 9/30/2025 DLT SOLUTIONS LLC 7/29/2025 DAVIS FARR LLP 9/29/2025 DAVIS TRUCKING LLC 10/21/2025 DELFINA GONZALEZ 2064633 100.80 8/28/2025 8/31/2025 D&H WATER SYSTEMS INC 2064573 8,371.59 9/17/2025 9/10/2025 10/1/2025 10/1/2025 10/1/2025 10/1/2025 CSI SERVICES INC 9/8/2025 CLAUDIA SANDOVAL 10/7/2025 CORELOGIC SOLUTIONS LLC 9/30/2025 COUNTY OF SAN DIEGO 2064550 5,000.00 UPFP PERMIT RENEWAL 8/17/2025 8/17/2025 8/17/2025 8/17/2025 7/31/2025 2064701 5,580.00 10/1/2025 CLARKSON LAB & SUPPLY INC 2064700 1,950.00 9/30/2025 9/30/2025 CATHERINE VELASCO 10/21/2025 CHULA OWNER II LLC 10/6/2025 10/22/2025 9:02:37 PM Page 3 Check Register Check Dates: 9/18/2025 thru 10/22/2025 2064574 19,575.00 PROJECT MANAGEMENT SERVICES 19,575.00 10/1/2025 21597 25324 WATER AUDIT SERVICES FY24-FY25 2,250.00 10/15/2025 21597 14141 WATER AUDIT SERVICES FY24-FY25 31,211.58 10/15/2025 21597 25466 2064671 267.88 FY26 RECYCLED WASTE SERVICE 267.88 10/15/2025 2447 5458093025 2064716 137.45 EXPENSE REIMBURSEMENT 137.45 10/22/2025 17714 102125 2064672 40,715.99 MS LICENSING & HARDWARE/SOFTWARE 40,715.99 10/15/2025 20794 237503 CLOUD SW SUBSCRIPTION - JULY 2025 276.56 10/22/2025 20794 235918 CLOUD SW SUBSCRIPTION - AUG 2025 276.56 10/22/2025 20794 237470 2064575 1,459.68 CY25 VISION BENEFITS ADMIN 1,459.68 10/1/2025 20511 166993564 2064576 7,305.45 INVENTORY 6,780.00 10/1/2025 3546 0891288 INVENTORY 735.20 10/15/2025 3546 0891157 INVENTORY 927.12 10/15/2025 3546 0892079 2064704 99.00 DOCUMENT SERVICE FY 2026 99.00 10/22/2025 17888 9003400925 2064674 150.00 FY26 GYM EQUIPMENT MAINTENANCE 150.00 10/15/2025 2591 13065 2064553 60.00 BI-WEEKLY PAYROLL DEDUCTION 60.00 9/24/2025 22973 BEN2755269 2064635 60.00 BI-WEEKLY PAYROLL DEDUCTION 60.00 10/8/2025 22973 BEN100825 2064705 60.00 BI-WEEKLY PAYROLL DEDUCTION 60.00 10/22/2025 22973 BEN102225 MILEAGE REIMBURSEMENT - SEPT 2025 60.20 10/8/2025 22628 090125093025 EXPENSE REIMBURSEMENT - AUG 2025 245.63 10/8/2025 22628 082425082825 2064706 167.40 EXP AND MILE REIMBURSEMENT - SEPT 2025 167.40 10/22/2025 22628 092125092325 AS-NEEDED FLEET WASH SERV 111.52 10/1/2025 30368 FC3290367 AS-NEEDED FLEET WASH SERV 154.15 10/1/2025 30368 FC3279513 AS-NEEDED FLEET WASH SERV 34.78 10/15/2025 30368 FC3300511 AS-NEEDED FLEET WASH SERV 490.78 10/15/2025 30368 FC3309854 2064554 21,506.23 FY26 SCADA SOFTWARE LICENSE 21,506.23 9/24/2025 30289 17001100077369 2064637 3,274.58 MICROSOFT 365 LICENSES 3,274.58 10/8/2025 30185 R1071SA-6 SMA HABITAT MANAGEMENT 196.25 10/22/2025 2008 130160 SMA HABITAT MANAGEMENT 7,092.64 10/22/2025 2008 130162 SMA HABITAT MANAGEMENT 14,946.32 10/22/2025 2008 130267 2064676 8,941.59 INVENTORY 8,298.48 10/15/2025 21322 0004264 2064578 2,920.84 BILL PROCESSING SERVICES FY26 2,920.84 10/1/2025 8969 295138 BILL PROCESSING SERVICES FY26 3,014.61 10/15/2025 8969 296132 BILL PROCESSING SERVICES FY26 17,143.64 10/15/2025 8969 296133 HPS WEST INC.9/25/2025 INFOSEND INC 9/16/2025 2064677 20,317.10 9/30/2025 9/30/2025 GE VERNOVA ELECTRIFICATION SOFTWARE LLC 6/28/2025 GIGAKOM 9/30/2025 HELIX ENVIRONMENTAL 2064707 22,235.21 9/26/2025 9/26/2025 9/28/2025 FW FLEET CLEAN LLC 2064577 265.67 9/12/2025 9/5/2025 2064675 525.56 9/19/2025 9/26/2025 FRANCISCO RIVERA 2064636 305.83 9/30/2025 8/28/2025 9/30/2025 FIRST AMERICAN DATA TREE LLC 9/30/2025 FITNESS TECH 10/1/2025 FRANCHISE TAX BOARD 9/24/2025 10/8/2025 10/22/2025 EYEMED (FIDELITY)9/20/2025 FERGUSON WATERWORKS # 1083 9/12/2025 2064673 1,791.14 9/23/2025 9/24/2025 EDCO DISPOSAL CORPORATION 9/30/2025 EILEEN SALMERON 10/21/2025 ENTISYS 360 9/22/2025 2064703 553.12 8/21/2025 9/22/2025 E SOURCE COMPANIES LLC 8/31/2025 2064670 33,461.58 9/26/2025 9/30/2025 10/22/2025 9:02:37 PM Page 4 Check Register Check Dates: 9/18/2025 thru 10/22/2025 2064678 9,872.00 FY26 FORCEPOINT SUPPORT RENEWAL 9,872.00 10/15/2025 3380 1101318449 2064638 2,473.00 ANTENNA SUBLEASE 2,473.00 10/8/2025 20752 414003958 2064650 29.66 UB REFUND 0000275277 29.66 10/8/2025 99999 ubRef100925004 2064579 7,050.00 CHLORINE GAS 7,050.00 10/1/2025 10563 978424 2064555 295.00 EXPENSE REIMBURSEMENT 295.00 9/24/2025 14323 092325 2064679 709.62 EXPENSE REIMBURSEMENT 709.62 10/15/2025 4349 101325 2064580 14,918.81 AS-NEEDED PAVING SVCS (CIP) 15,704.00 10/1/2025 5840 25-119-2 2064708 40,943.54 AS-NEEDED PAVING SERVICES 43,098.46 10/22/2025 5840 25-119-3 2064680 95.00 CONSULTING SERVICES FOR TYLER 95.00 10/15/2025 22411 11445 2064559 295.00 EXPENSE REIMBURSEMENT 295.00 9/24/2025 17616 092325 2064709 197.00 TRAVEL/MEAL ADVANCEMENT 197.00 10/22/2025 8159 LT101625 2064581 3,465.00 FY26 GENERAL HEALTH & SAFETY 3,465.00 10/1/2025 21524 4023 2064681 1,995.00 FY26 GENERAL HEALTH & SAFETY 1,995.00 10/15/2025 21524 4024 2064640 299.99 TUITION REIMBURSEMENT (SPRING 2025)299.99 10/8/2025 19966 LZ092925 2064682 97,327.50 TELEGRAPH CANYON ROAD FH REMOVAL 102,450.00 10/15/2025 18905 090925 2064582 159.11 CUSTOMER REFUND 159.11 10/1/2025 22572 8351093025 2064683 945.00 FY26 ADMIN LANDSCAPE UPGRADE 945.00 10/15/2025 21723 11625 2064549 3,000.00 TUITION REIMBURSEMENT (FALL 2025)3,000.00 9/24/2025 13390 MC091525 2064639 493.79 EXPENSE REIMBURSEMENT 493.79 10/8/2025 21255 100625 2064710 323.00 TRAVEL ADVANCEMENT 323.00 10/22/2025 3215 1542101525 2064711 197.00 TRAVEL ADVANCEMENT 197.00 10/22/2025 3151 MZ101625 2064722 1,673.52 UB REFUND 0000291367 1,673.52 10/22/2025 99999 ubRef102325009 (2) E-TRANSIT VANS & (1) F-150 44,470.43 10/8/2025 21483 WF14081 (2) E-TRANSIT VANS & (1) F-150 54,010.68 10/8/2025 21483 WF13644 2064712 58,195.83 (2) E-TRANSIT VANS & (1) F-150 54,010.68 10/22/2025 21483 WF13641 2064684 10,750.00 FY26/CY25 LANDSCAPE MAINTENANCE 10,750.00 10/15/2025 17261 10416 2064713 2,470.00 FY26/CY25 LANDSCAPE MAINTENANCE 2,470.00 10/22/2025 17261 10385 2064685 2,770.00 GEOTECHNICAL SERVICES 2,770.00 10/15/2025 761 308679 2064723 159.72 UB REFUND 0000305045 159.72 10/22/2025 99999 ubRef102325012 2064686 845.25 WITHHOLDING TAX 845.25 10/15/2025 20996 601397030 093025 DESIGN/CONSTRUCTION - RSD/JAMUL 1,382.50 9/24/2025 18332 447364 NORMAN CHRISMAN 10/21/2025 NORTH CAROLINA DEPT OF REVENUE 9/30/2025 NV5 INC 2064556 7,277.50 5/9/2025 NATURESCAPE SERVICES 9/30/2025 9/24/2025 NINYO & MOORE GEOTECHNICAL 9/19/2025 NATIONAL AUTO FLEET GROUP 2064641 106,112.04 9/25/2025 9/25/2025 10/15/2025 MICHAEL O'DONNELL 10/15/2025 MING ZHAO 10/16/2025 MOLLER RETAIL INC 10/21/2025 MERINO LANDSCAPE INC 9/30/2025 MICHAEL CHRISTENSEN 9/15/2025 MICHAEL LONG 10/6/2025 LUIS ZAVALA 3/31/2025 M RAE ENGINEERING INC 9/9/2025 MARIA SOWDERS 9/30/2025 LARRY RAMIREZ 9/23/2025 LEONEL TORRES 10/16/2025 LINDSAY POLIC CONSULTING INC 9/16/2025 10/1/2025 KIRK PAVING INC 9/17/2025 9/18/2025 KOA HILLS CONSULTING LLC 9/30/2025 JCI JONES CHEMICALS INC 9/9/2025 JEFFREY EDWARDS 9/23/2025 JONATHAN CHAMBERS 10/13/2025 INSIGHT PUBLIC SECTOR INC 10/1/2025 IWG TOWERS ASSETS II LLC 10/1/2025 JARED HOFMANN 10/7/2025 10/22/2025 9:02:37 PM Page 5 Check Register Check Dates: 9/18/2025 thru 10/22/2025 DESIGN/CONSTRUCTION - RSD/JAMUL 5,895.00 9/24/2025 18332 451694 RATE INCREASE MAILING DATA PROCESS 3,045.06 9/24/2025 22274 68246 RATE INCREASE MAILING DATA PROCESS 13,507.22 9/24/2025 22274 68245-073025 2064687 11,279.36 RATE INCREASE RE-PRINTING SERV 11,279.36 10/15/2025 22274 SALES ORDER #686852064714259.00 TUITION REIMBURSEMENT (CWEA MT1)259.00 10/22/2025 22570 OHR100925 2064583 735,284.23 870-2 RES 3.4 MG & 870-1 RES 735,284.23 10/1/2025 6646 908312025 INVENTORY 768.00 10/15/2025 1002 S100480241.002 INVENTORY 1,313.00 10/15/2025 1002 S100480098.002 INVENTORY 1,890.00 10/15/2025 1002 S100480098.001 INVENTORY 7,232.00 10/15/2025 1002 S100480241.001 INVENTORY 9,125.44 10/15/2025 1002 S100480664.001 2064558 2,860.00 PREEMPTIVE PETTY CASH REIMBURSE 2,860.00 9/24/2025 137 092225 2064584 1,930.40 PETTY CASH REIMBURSEMENT 1,930.40 10/1/2025 137 092325 2064585 6,500.00 FY26 PIPELINE OBSERVE SYST MGMT 6,500.00 10/1/2025 16208 4751 2064586 2,180.00 AS-NEEDED ASSET MGMT 2,180.00 10/1/2025 20861 41924 2064689 145.00 RANDOM DRUG TESTING 145.00 10/15/2025 22238 11984 2064715 345.00 RANDOM DRUG TESTING 345.00 10/22/2025 22238 11983 2064587 233.81 FY26 AS-NEEDED SAFETY BOOTS 233.81 10/1/2025 19836 20250910069504 2064690 81,570.80 DATA CTR REDUCTION AND IT OFFICE 85,864.00 10/15/2025 30286 250232 MILEAGE REIMBURSEMENT - AUG 2025 118.30 10/8/2025 4542 080125083125 MILEAGE REIMBURSEMENT - SEPT 2025 124.60 10/8/2025 4542 090125093025 2064724 73.76 UB REFUND 0000032802 73.76 10/22/2025 99999 ubRef102325001 2064652 134.36 UB REFUND 0000206104 134.36 10/8/2025 99999 ubRef100925003 AS-NEEDED TEMP STAFFING 1,243.52 9/24/2025 30396 16319774 AS-NEEDED TEMP STAFFING 1,554.40 9/24/2025 30396 16313368 AS-NEEDED TEMP STAFFING 1,554.40 9/24/2025 30396 16315502 AS-NEEDED TEMP STAFFING 1,554.40 9/24/2025 30396 16317638 AS-NEEDED TEMP STAFFING 1,554.40 9/24/2025 30396 16321915 ROBERTA TATREAU 10/21/2025 ROSAURO DETUBIO 10/7/2025 ROTH STAFFING COMPANIES LP 2064560 7,461.12 9/12/2025 8/22/2025 8/29/2025 9/5/2025 9/19/2025 RED WING BUSINESS ADV ACCOUNT 9/10/2025 RJ NICHOLS CONSTRUCTION INC 9/5/2025 ROBAK, MARK 2064642 242.90 8/31/2025 9/30/2025 RAFTELIS 9/18/2025 RCDA LLC 9/29/2025 9/29/2025 PETTY CASH CUSTODIAN 9/22/2025 9/23/2025 POSM SOFTWARE LLC 6/3/2025 OSCAR HERNANDEZ RIOS 10/9/2025 PACIFIC HYDROTECH CORPORATION 9/11/2025 PACIFIC PIPELINE SUPPLY INC 2064688 21,903.90 10/2/2025 9/30/2025 9/24/2025 10/2/2025 9/19/2025 OMNI GRAPHICS 2064557 16,552.28 7/18/2025 7/30/2025 9/30/2025 6/3/2025 10/22/2025 9:02:37 PM Page 6 Check Register Check Dates: 9/18/2025 thru 10/22/2025 2064691 1,554.40 AS-NEEDED TEMP STAFFING 1,554.40 10/15/2025 30396 16324067 2064654 512.81 UB REFUND 0000068513 512.81 10/8/2025 99999 ubRef100925002 2064649 28.72 UB REFUND 0000301256 28.72 10/8/2025 99999 ubRef100925007 2064588 9,110.25 INVEST ADVISOR FOR DEFERRED COMP 9,110.25 10/1/2025 19377 2025-20641 2064643 125.00 FY26 MONTHLY ASSESSOR DATA 125.00 10/8/2025 2586 202500884 2064589 240.99 SOCAL WATERSMART HEW HET WBIC 240.99 10/1/2025 3 2962 UTILITY EXPENSES - MONTHLY 1,046.13 10/8/2025 121 092525 UTILITY EXPENSES - MONTHLY 51,310.26 10/8/2025 121 092625 UTILITY EXPENSES - MONTHLY 93,334.02 10/8/2025 121 092325 UTILITY EXPENSES - MONTHLY 104,127.76 10/8/2025 121 092925 2064692 139,828.41 UTILITY EXPENSES - MONTHLY 139,828.41 10/15/2025 121 100725 UTILITY EXPENSES - MONTHLY 42.12 10/22/2025 121 100925 UTILITY EXPENSES - MONTHLY 9,325.15 10/22/2025 121 101425 UTILITY EXPENSES - MONTHLY 30,819.45 10/22/2025 121 100925A 2064725 2,045.89 UB REFUND 0000305838 2,045.89 10/22/2025 99999 ubRef102325013 2064645 215.00 ON-DEMAND SECURITY RESPONSE 215.00 10/8/2025 19603 12318467 2064726 1,061.36 UB REFUND 0000300603 1,061.36 10/22/2025 99999 ubRef102325011 2064727 20.38 UB REFUND 0000185255 20.38 10/22/2025 99999 ubRef102325002 2064728 1,530.36 UB REFUND 0000283265 1,530.36 10/22/2025 99999 ubRef102325007 2064651 32.50 UB REFUND 0000005854 32.50 10/8/2025 99999 ubRef100925001 2064646 11,649.47 CY2025 LIFE & STD/LTD INSURANCE 11,649.47 10/8/2025 15974 38166090125 2064718 800.00 AS-NEEDED COMMUNICATIONS CONSULT 800.00 10/22/2025 18376 1832 2064729 2,368.91 UB REFUND 0000298948 2,368.91 10/22/2025 99999 ubRef102325010 2064590 480.00 FIRE SPRINKLER INSPECTION 480.00 10/1/2025 22498 688873 2064693 355.00 FIRE SPRINKLER INSPECTION 355.00 10/15/2025 22498 690173 2064647 1,802.96 4IN SEWER WET TAP 4412 CARMEN 1,802.96 10/8/2025 30422 100625 D1198- 090653 2064730 57.71 UB REFUND 0000216656 57.71 10/22/2025 99999 ubRef102325004 TIM DOUDNA 10/6/2025 TOM KRIEGER 10/21/2025 TC CONSTRUCTION 10/21/2025 THE HILLER COMPANIES 9/18/2025 9/22/2025 STEVEN GARCIA 10/7/2025 SUN LIFE FINANCIAL 9/1/2025 SVPR COMMUNICATIONS LLC 9/30/2025 SESAME PLACE SEAWORLD PARKS 10/21/2025 SHARINA WEAVER 10/21/2025 SHEA HOMES LIMITED PARTNERSHIP 10/21/2025 10/9/2025 SAN DIEGO SCCA 10/21/2025 SECURITAS SECURITY SVC USA INC 10/2/2025 SAN DIEGO COUNTY ASSESSOR 10/2/2025 SAN DIEGO COUNTY WATER AUTH 9/18/2025 SAN DIEGO GAS & ELECTRIC 2064644 249,818.17 9/25/2025 9/26/2025 9/23/2025 9/29/2025 10/7/2025 2064717 40,186.72 10/9/2025 10/14/2025 ROY WESTCOTT 10/7/2025 RUBEN MADRIGAL 10/7/2025 SAGEVIEW ADVISORY GROUP LLC 9/15/2025 9/26/2025 10/22/2025 9:02:37 PM Page 7 Check Register Check Dates: 9/18/2025 thru 10/22/2025 2064591 2,991.10 BOARD ROOM RTU REPLACEMENT 2,991.10 10/1/2025 2641 315654833 2064592 9,600.00 MUNIS ERP UPGRADE IMPLEMENTATION 9,600.00 10/1/2025 3261 045-537497 2064694 4,800.00 MUNIS ERP UPGRADE IMPLEMENTATION 4,800.00 10/15/2025 3261 045-538932 2064695 100.00 FILING 8038-CP FORMS SERIES 20 100.00 10/15/2025 20891 7908932 2064593 2,031.80 700 PUMP PARTS 1,887.80 10/1/2025 20837 0040364 DIG ALERT CA MEMBERSHIP 300.68 10/22/2025 427 25261056 DIG ALERT CA MEMBERSHIP 606.00 10/22/2025 427 920250523 PORT TOILET RENTAL 164.00 9/24/2025 15675 5604956 PORT TOILET RENTAL 800.00 9/24/2025 15675 5605137 PORT TOILET RENTAL 164.00 10/22/2025 15675 5667130 PORT TOILET RENTAL 800.00 10/22/2025 15675 5667011 2064656 12,234.35 PREPAID POSTAGE FOR RE-MAILING 12,234.35 10/8/2025 8402 68685 FORM 3602-R CMIS - AUG 2025 3,060.00 10/1/2025 8028 OWD1485TC08 CMIS - AUG 2025 3,230.00 10/1/2025 8028 SD545823 CMIS - AUG 2025 39,175.00 10/1/2025 8028 SD24030512 2064731 100.00 UB REFUND 0000283927 100.00 10/22/2025 99999 ubRef102325008 2064655 840.91 UB REFUND 0000305071 840.91 10/8/2025 99999 ubRef100925008 596.40 9/24/2025 20909 47087291 596.40 9/24/2025 20909 47088078 FY26 WATER INTERNS 1,133.16 9/24/2025 20909 47088353 FY26 WATER INTERNS 1,192.80 9/24/2025 20909 47082762 596.40 10/1/2025 20909 47094103 596.40 10/1/2025 20909 47094844 2064696 140.00 BEE REMOVAL SERVICES 140.00 10/15/2025 1343 90118 2064734 11,369.20 PLAN CHECK (8/9/25-9/5/25) 11,369.20 10/22/2025 21997 2064291 HYDRAULIC MODELING - AUG 2025 380.00 10/8/2025 19866 196170 HYDRAULIC MODELING - AUG 2025 2,080.00 10/8/2025 19866 1961576158 HYDRAULIC MODELING - AUG 2025 10,850.00 10/8/2025 19866 196180 2064653 149.12 UB REFUND 0000294192 149.12 10/8/2025 99999 ubRef100925006 Total 2,661,150.14 YUCHIN KANG 10/7/2025 WOOD RODGERS INC 2064657 13,310.00 8/31/2025 8/31/2025 8/31/2025 9/21/2025 WE GOT YA PEST CONTROL INC 9/30/2025 WEST YOST & ASSOCIATES INC 8/31/2025 VERNON MAGAZZU 10/21/2025 VETSOURCE INC 10/7/2025 VOLT WORKFORCE SOLUTIONS 2064562 3,518.76 FY26 WATER INTERNS 9/14/2025 9/14/2025 9/14/2025 9/7/2025 2064595 1,192.80 FY26 WATER INTERNS 9/21/2025 US POSTMASTER 10/6/2025 VALLEY CONSTRUCTION MANAGEMENT 2064594 45,465.00 9/8/2025 9/8/2025 9/8/2025 UNITED SITE SERVICES INC 2064561 983.77 9/16/2025 9/16/2025 2064733 983.77 10/14/2025 10/14/2025 UGSI CHEMICAL FEED INC 9/15/2025 UNDERGROUND SERVICE ALERT 2064732 906.68 10/1/2025 10/1/2025 TYLER TECHNOLOGIES INC 9/12/2025 9/25/2025 U.S. BANK NATIONAL ASSOCIATION 9/25/2025 TRANE US INC 9/13/2025 10/22/2025 9:02:37 PM Page 8