HomeMy WebLinkAboutFY 2025 Annual Comprehensive Financial ReportOtay Water District
Annual Comprehensive Financial Report
for the Fiscal Year Ended June 30, 2025
BOARD OF DIRECTORS
Jose Lopez, Division 4 President
Gary Croucher, Division 3 Vice President
Francisco X. Rivera, Division 1 Treasurer
Delfina Gonzalez, Division 2
Mark Robak, Division 5
DISTRICT FINANCIAL MANAGEMENT
Jose Martinez General Manager
Joseph R. Beachem Chief Financial Officer
Kevin Koeppen Assistant Chief, Finance
PREPARED BY
Finance Department
Otay Water District, Spring Valley, California
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Table of Contents
Introductory Section
Letter of Transmittal……………………………………………………………………………………………………………………………………. iii
Organization Chart…………………………………………………………………………………………...………………………………………… xii
List of Principal Officials…………………………………………………………………………………………………...……………………….. xiii
GFOA Certificate of Achievement……………………………………………………………………………………………...……………. xiv
Financial Section
Independent Auditors’ Report………………………………………………………………………………………………………...………..… 1
Management’s Discussion & Analysis…………………………………………………...…………………………………...………….. 4
Basic Financial Statements:
Statements of Net Position..…………………………………………………………………………………………………………...….….. 15
Statements of Revenues, Expenses, and Changes in Net Position………….…………………………...…… 17
Statements of Cash Flows……………………………………………………………….…………………………………………………...….. 18
Notes to Financial Statements………………………………………………………………………………………………………………... 20
Required Supplementary Information:
Schedule of Changes in the Net OPEB Liability and Related Ratios ….……………………………………….. 67
Schedule of Contributions ………………………………………………………………………………………………………………………. 69
Schedule of Changes in the Net Pension Liability and Related Ratios ..……..……………………………... 70
Schedule of Plan Contributions ………………………………………………………....…………………………………………………. 72
Statistical Section
Net Position by Component…………………………………………………………………………………………………………………….. 74
Net Investment in Capital Assets…………………….………………………………………………………………….………………..… 75
Changes in Net Position………………………………………………………………..………………………………………………………….. 76
Operating Revenues by Source…………………………………………………………………………………………….……………….. 77
Operating Expenses by Function………………………………………………………..…………………………………………………. 78
Non-Operating Revenues by Source……………………………………………………………………………………………………. 79
Non-Operating Expenses by Function………………………………………………………………………………………………. 80
Assessed Valuation of Taxable Property within the District…………………………………………………………. 81
Water Purchases, Production, and Sales……………………………………………...………………………….…………………. 82
Meter Sales by Type…………………………………………………………………….……………………………………………………………. 83
Number of Customers by Service Type……………………………………………………………………………………………….. 84
Property Tax Levies and Collections…………………………………………………………………………………………………….. 85
Water Fixed Rates ……….………………………………………………………………………………………………………………………….…. 86
Water Variable Rates…….…………………………………………………………………………………………………………………………... 89
Sewer Variable and Fixed Rates…….………………………………………………………………………..…………………………….. 90
Ten Largest Customers…………………………………………………………………………………………………………………………….. 91
Ratios of Outstanding Debt by Type…………………………………………………….……………………………………………….. 92
Pledged Revenue Coverage (Water)……………………………………………………………………………………………………. 93
Pledged Revenue Coverage (Wastewater)…………………………………………………………………………………………. 94
Ratios of General Bonded Debt Outstanding………………………………………………………………….………………..… 95
Computation of Direct and Overlapping Bonded Debt………………………………………………………………… 96
San Diego County Principal Employers……………….……………….......................................................……………….. 98
San Diego County Demographic and Economic Statistics……………..…………………………………………….. 99
Number of Employees by Function………………………………………………………………………………………………………. 100
Active Meters by Size………………………………………………………………..………………………………………………………………. 101
Operating and Capital Indicators…………………………………………………………………………………………………………... 102
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October 29, 2025
Honorable Board of Directors
Citizens of the Otay Water District
We are pleased to present the Otay Water District's (District) Annual Comprehensive Financial Report
for the fiscal year ended June 30, 2025.
This report was prepared by the District's Finance Department following guidelines set forth by the
Government Accounting Standards Board (GASB) and generally accepted accounting principles
(GAAP). Responsibility for the accuracy of the data presented and the completeness and fairness of
the presentation, including all disclosures, rests with the District's management. We believe the data,
as presented, is accurate in all material respects and that it is presented in a manner that provides a
fair representation of the financial position and results of the District's operations. Included are all
disclosures we believe necessary to enhance your understanding of the financial condition of the
District. GAAP requires that management provide a narrative introduction, overview, and analysis to
accompany the basic financial statements in the form of Management's Discussion and Analysis
(MD&A), which should be read in conjunction with this report. The District's MD&A can be found
immediately following the Independent Auditors' Report.
Davis Farr LLP, a firm of licensed certified public accountants, audited the District's financial
statements. The goal of the independent audit was to provide reasonable assurance that the financial
statements of the District for the fiscal year ended June 30, 2025, are free of material misstatement.
The independent audit involved examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements, assessing the accounting principles used and significant
estimates made by management, and evaluating the overall financial statement presentation. In the
independent auditors' opinion, the following financial statements present fairly, in all material respects,
the respective financial position of the District as of June 30, 2025, and are presented in conformity
with GAAP. The Independent Auditors' Report is presented as the first component of the financial
section of this report.
REPORTING ENTITY
The District is a publicly owned water and sewer agency, authorized on January 27, 1956, as a
California special district by the State Legislature, with an entitlement to import water under the
Municipal Water District Act 1911. Its ordinances, policies, taxes, and service rates are set by five
Directors, elected by voters in their respective geographic divisions, to serve staggered four-year terms
on its Governing Board. The District is a not-for-profit public agency that provides water service to the
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community. As a governmental entity, the District does not make a profit from providing water service
and cannot operate at a loss. The District also performs cost of service studies to ensure that each
end-user pays only their proportionate share of the District's costs of water acquisitions, construction,
operation, maintenance, betterment, renewal, and replacement of the public water and sewer
facilities.
The General Manager reports directly to the Board of Directors and oversees day-to-day operations of
Administrative Services, Finance, Water Operations, and Engineering through the four District Chiefs.
These and other lines of reporting are shown on the organization chart on page xii. Over the last 69
years, the District has grown from a handful of customers and two employees to become an
organization operating a network of 755 miles of potable and 107 miles of recycled water pipelines, 84
miles of sewer mains, 44 operational reservoirs, a recycled water facility, and one of the largest
recycled water distribution networks in the State of California. The service area's character has also
changed from predominantly dry-land farming and cattle ranching to businesses, high-tech industries,
and large master-planned communities.
Today the District provides water
service to approximately 52,007
potable and 809 recycled customers
within 125 square miles of the
southeastern San Diego metropolitan
area. The District purchases all potable
water sold to its customers from the
San Diego County Water Authority
(CWA). The CWA purchases much of
this water from the region's primary
water importer, the Metropolitan Water
District of Southern California (MWD),
and the Imperial Irrigation District. In
December 2015, the Claude "Bud" Lewis Carlsbad Desalination Plant began delivering water to the
region. The District also entered into an agreement with the CWA that brought regional water
treatment closer to our customers and helped reduce dependence on water treatment facilities
located outside of San Diego County. In 2010, the District constructed two 10-million-gallon reservoirs
and a 5.1-mile, 36-inch diameter pipeline to receive locally treated potable water from Helix Water
District's R.M. Levy Water Treatment Plant and convey it to customers.
The District also owns and operates a wastewater collection and recycling system providing public
sewer service to approximately 4,757 customer accounts within portions of the communities of La
Mesa, Rancho San Diego, El Cajon, Jamul, and Spring Valley. Wastewater collected is conveyed to
the District's Ralph W. Chapman Water Reclamation Facility, capable of recycling wastewater at a rate
of 1.3 million gallons per day. The District also can purchase up to 6 million gallons per day of recycled
water from the City of San Diego's South Bay Water Reclamation Plant. The District uses the recycled
water from these two sources to irrigate eastern Chula Vista schools, public parks, roadway
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landscapes, a golf course, and various other approved uses per California Code of Regulations, Title
22. The use of recycled water reduces dependency on imported supplies and provides a local supply,
thereby diversifying District resources.
MISSION, CURRENT ECONOMIC CONDITIONS, AND OUTLOOK
The District's mission is to provide high quality and reliable water and wastewater services to the Otay
Water District customers in a professional, effective, and efficient manner.
The District's Public Services Division saw a moderate decrease in the recent year, approving an
average of 44.6 permits per month and selling 160 water meters during fiscal year 2025, compared to
193 water meters in fiscal year 2024. As of July 2025, it is estimated that the District served
approximately 242,155 residents. The San Diego Association of Governments (SANDAG), the regional
planning agency, has estimated the District's average long-term growth of 0.22%. The District expects
nominal growth in the customer base of 1.0% for Fiscal Year 2026 and projects an ultimate customer
population of 271,500 residents by 2055.
LEGISLATIVE AND REGULATORY ISSUES
The District continues to monitor legislative and regulatory activity and how it could impact the District
and its customers. The primary legislative activity for the District and its legislative consultant has been
tracking numerous legislation and engaging on SB 707 (Durazo), which makes numerous changes to
the Ralph M. Brown Act, including new public access and participation requirements for specified
legislative bodies, new exemptions from certain teleconferencing requirements for eligible subsidiary
bodies and eligible multijurisdictional bodies, extensions of law providing exemptions from certain
teleconferencing requirements for specified legislative bodies or under specified circumstances, and
additional changes. The District originally joined a large coalition in opposition alongside the California
Special Districts Association (CSDA) but removed its opposition along with CSDA because the bill was
amended. The Governor signed the bill.
The District, along with the Association of California Water Agencies (ACWA) and other coalition
members, continued to oppose AB 339 (Ortega) due to the costs it would impose on local agencies,
including new notification requirements and unclear language that could result in increased conflict
with the District’s labor partners. This bill requires public agencies regulated by the Meyers-Milias-
Brown Act to give a recognized employee organization no less than 45 days’ written notice regarding
certain contracts to perform services that are within the scope of work of job classifications
represented by the recognized employee organization. The bill was amended in the Senate to reduce
the timeframe in which a public agency must give written notice to the recognized employee
organization (originally 120 days, reduced to 45 days) before issuing a request for proposals, request
for quotes, or renewing or extending an existing contract, along with additional amendments. The
Governor signed the bill into law.
The District also monitored SB 394 (Allen), an ACWA-sponsored legislation which allows local
agencies to establish ordinances specific to water theft from hydrants, modifies penalties for other
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water theft ordinances, and adds theft from fire hydrants to provisions of existing law related to civil
suits for water theft. The bill expands the list of actionable offenses for tampering with or diverting
water from fire hydrants without authorization and using them for non-firefighting purposes. The
Governor signed the bill into law.
The District closely monitored AB 367 (Bennett), which ACWA and other stakeholders maintained an
“oppose unless amended” position. The bill establishes mandates that water districts in Ventura
County, supplying water to more than 20 homes in high or very high fire hazard zones, ensure backup
power for wells and pumps for at least 24 hours during power outages, unless systems are gravity-
fed. ACWA adopted an oppose unless amended position because the bill would “place costly
requirements on water districts without a suitable funding source, which threatens water affordability,
and would dictate how trained water professionals operate their systems.” There was also concern
that a bill would be introduced or amended to impose these mandates on agencies statewide. The
author amended the bill in the Senate to delay implementation until 2030, allowing for the use of an
alternative water source in lieu of backup generation, among other provisions. This bill was signed
into law by the Governor.
Below are the bills that the District continued to monitor:
SB 31 (McNerney), which is the California WaterReuse-sponsored bill that will update Title 22
to expand the use of recycled water for nonpotable purposes. Title 22 for nonpotable uses of
recycled water has not been updated in 20 years. The outdated regulations discouraged the
use of recycled water in certain spaces, such as homeowner association landscape irrigation,
decorative bodies of water, public parks, and food-handling facilities. ACWA adopted a “favor”
position. The Governor signed the bill into law.
SB 72 (Caballero), which revises and recasts requirements for the contents of the California
Water Plan, requires the Department of Water Resources (DWR) to develop a long-term water
supply planning target for 2050, and establishes an interim target to develop an additional 9
million acre-feet of water by 2040. ACWA had a “support” position. The Governor signed this
bill into law.
The District will continue to monitor regulatory developments of drinking water, water quality, and
water rights fees at the State Board.
Additionally, the District continues to monitor the Advance Clean Fleets (ACF) Regulation at the
California Air Resources Board (CARB). The District filed comments with CARB as they considered
amendments to the ACF Regulations required by AB 1594 (Garcia, 2023). The District’s letter outlined
the specific challenges in detail and offered collaboration on solutions. The letter summarized the
fleet compliance plan and current inventory, the exemptions the District anticipates seeking, key pain
points, critical compliance years, and requested regulatory flexibilities.
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FISCAL YEAR 2023-2026 STRATEGIC PLAN
The strategic plan details our commitment to remain a model public agency that maintains
stakeholder trust through fiscal responsibility, environmental stewardship, and effective leadership.
Since 1956 the District's theme has been and continues to be "Dedicated to Community Service." This
motto serves as a great reminder for our staff of the responsibility and significance of delivering
exceptional service to the residents and businesses in our community.
Over the years the District’s strategic plan has evolved from one focused on growth to one focusing
on consistent business and operational efficiencies, innovation, and long-term asset management
and capital improvement program advancements. The District’s current strategic plan (FY 2023-2026),
adopted by the Board in January 2022, highlights areas of focus, including a stronger emphasis on
financial and long-term demands, legislative matters, aging workforce and knowledge transfer,
organizational culture, customer service, cybersecurity, and asset management. Quarterly and annual
performance metrics support short-term and long-term objectives linked to these strategies to
promote and track continuous improvement.
The plan reinforces the Board’s vision, mission, and value statements and the business perspectives
that serve as the foundation for the new strategies, goals, and objectives. The strategic plan addresses
several challenges facing the District today. They include fulfilling more stringent water quality
requirements, meeting the water demands of a developing community, discovering methods to better
use our current water resources through storage and water conservation, retention and recruitment
of a skilled workforce, and maintaining an adaptable organization to meet future challenges. The
strategic plan allows us to also convey our plans to our customers, other agencies, and water
regulators. As with past plans, we are confident that this plan will help us to successfully implement
the Board’s direction.
As the District's infrastructure ages, there will be increasing financial pressure to meet the costs of
replacing infrastructure. To mitigate these pressures, the management team continues to prioritize
efficiency inside the agency via investments in operational and business technologies to optimize an
efficient workforce.
Through community focus, sound planning, preparation, and fiscal management, and a prepared and
adaptable work culture, the District is well positioned to support its growing customer base while
sustaining the quality water service that our community and our ratepayers expect. These high-level
strategic objectives are further articulated within the current Strategic Plan, outlining District-wide
accountability, and performance metrics to measure and improve outcomes.
The success of this approach is proven by the District’s gains in productivity and reduction in staffing
while service growth continues. The District has reduced staffing by 26.75 full-time equivalent
positions, or 15.3%, while the number of customer accounts increased by 5,012, or 10% from 2007
through 2026.
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As of June 30, 2024, which is the most recent CalPERS actuarial pension valuation, the District’s
pension plan was 85.9% funded, and the Other Post-Employment Benefit (OPEB) plan was 94.0%
funded. The District will continue its strategy of advance funding its unfunded pension and OPEB
obligations. The FY 2026 budget includes a $680 thousand advance contribution to its defined benefit
programs. Staff is also recommending to return the advance funding amount to the $1.3 million level
over a period of time. The strategy of advance funding the District’s unfunded obligations aims to
reduce the District’s highest cost debt. This strategy is aimed to save the ratepayers money and will
save the District approximately $5.5 million over the 12-year advance funding period, which began in
2021.
Other cost savings include a reduction in operating and maintenance costs, fuel consumption, meters
and materials, fees and studies, and decreasing water loss through the successful leak detection and
repair program. Staff continues to seek out other operational efficiencies, thus decreasing costs and
minimizing rate impacts on District customers.
Based on an annual survey of water and sewer rates conducted by staff, the District has the tenth
lowest water rates of 22 agencies, and fourth lowest sewer rates of 28 agencies in the region.
BUDGETING CONTROLS
The District views the budget as an essential tool for proper financial management, which is adopted
before each fiscal year. The budget is developed by combining the District's strategic objectives and
measures with input from the organization's various departments. The budget becomes a direct
reflection of the District's strategic plan by incorporating these strategic measures and objectives. The
budget is designed and presented for the general needs of the District, its staff, and its customers. It is
a comprehensive and balanced financial plan that features District services, resources and allocation,
financial policies, strategic objectives, and other useful information that allows the users to understand
the District's financial status and future. The District monitors performance monthly by generating
comparative reports of budget to actual and distributing them to all department heads, with top-level
information provided to the Board at the monthly board meetings.
BUDGET SUMMARY
The District's operating expenditures consist of three major sectors: potable water, recycled water, and
wastewater. The total operating budget is $150,107,900 for Fiscal Year 2026. Revenues from potable
and recycled water sales are projected to be $132,815,000, about $11,703,000 (9.7%) higher than the
Fiscal Year 2025 budget. Water sales volumes are expected to decrease by 0.6% versus the Fiscal
Year 2025 budget. The MWD and CWA water supply rates are increasing 10.4% in Fiscal Year 2026
due to the high cost of supply programs, higher energy costs, and increasing operating costs. District
staff projects wastewater revenues to be $3,564,000, approximately $82,000 more than the Fiscal Year
2025. The remaining budgeted revenues of $13.7 million come from various special fees, assessments,
and non-operating revenues. An overall rate increase of 8.3% for potable water, 3.2% for recycled
water, and 5.2% for wastewater has been budgeted for January 1, 2026.
viii
The 2025-26 Capital Improvement Program (CIP) budget consists of 143 projects and a $19.7 million
budget. This year’s six-year CIP budget increased by $14.8 million from $170.7 million to $185.5 million.
The CIP budget emphasizes long-term planning for ongoing programs to meet population growth,
facilities replacement, and betterment of infrastructure while functioning within fiscal constraints.
THE FUTURE
The coming years will continue to pose challenges for those in California’s water community. Potable
sales volumes experienced an increase of 7.6% in fiscal year 2025 compared to fiscal year 2024 levels.
The District projects a 0.6% decrease in water sales volume in Fiscal Year 2026 compared to the
previous year’s budget and a decrease of 2.5% versus FY 2025 actual sales volume.
SAN DIEGO COUNTY WATER SUPPLY
San Diego County imports about 67% of its water from the Colorado River and Northern California.
Since these sources face legal and environmental constraints, the region has been exploring other
ways to ensure an adequate water supply, including increased water recycling, incorporating water-
use efficiency and conservation programs as a way of life, increased water storage, and groundwater,
and seawater desalination.
CAPITAL IMPROVEMENT PROGRAM (CIP)
To ensure a reliable water supply and sewer system for the future, including sustaining the current
infrastructure, the District has developed several future planning documents, which provide a guide
to defining the District's proposed projects.
The major projects planned for delivery over the next six fiscal years include:
Pipeline Replacement Projects (41 Total)
Reservoir Construction or Rehabilitation Projects
Meter Replacement
Pump Station Replacement and Rehabilitation
Vehicles and Capital Equipment
Reservoir Coatings
Valve Replacement
RWCWRF Treatment
ACCOUNTING SYSTEM
The Finance Department is responsible for providing financial services to the District, including
financial accounting, debt management, reporting, payroll, and accounts payable; investment of
funds, billing and collection of water and wastewater charges; taxes; and other revenues. The District's
books and records are maintained on an enterprise basis, matching revenues against the costs of
providing services. Revenues and expenses are recorded on an accrual basis when revenues are
earned, and expenses are incurred.
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INTERNAL CONTROLS
The District operates within a system of internal controls established and periodically reviewed by
management. This provides reasonable assurance that assets are adequately safeguarded, and
transactions are recorded correctly according to District policies and procedures. When establishing
or reviewing controls, management must also consider the cost of the control and its value derived
from its utilization. Management maintains and implements all sensitive controls and those controls
whose value adequately exceeds their cost.
Management believes the District's internal controls, procedures, and policies adequately safeguard
assets and provide reasonable assurance of proper recording of financial transactions. In addition, the
District maintains controls to provide for compliance with all finance-related legal and contractual
provisions. Management believes the activities reported within the presented Annual Comprehensive
Financial Report comply with these finances related legal and contractual provisions, including bond
covenants and fiduciary responsibilities.
AWARDS AND ACKNOWLEDGMENTS
The Government Finance Officers Association of the United States and Canada (GFOA) awarded a
Certificate of Achievement for Excellence in Financial Reporting to Otay Water District for its Annual
Comprehensive Financial Report for the fiscal year ended June 30, 2024. To earn a Certificate of
Achievement, a government agency must publish an easily readable and efficiently organized Annual
Comprehensive Financial Report. This report must satisfy both generally accepted accounting
principles and applicable legal requirements.
A Certificate of Achievement is valid for one year only. Staff believes that the District's current Annual
Comprehensive Financial Report continues to meet the Certificate of Achievement Program's
requirements and is submitting it to the GFOA to determine its eligibility for another certificate.
In addition to the Certificate of Achievement for Excellence in Financial Reporting, the District has
received the following awards:
The Government Finance Officers Association of the United States and Canada presented a
Distinguished Budget Presentation Award to Otay Water District for its annual budget for the
Fiscal Year 2024-2025. To achieve this award, a governmental unit must publish a budget
document that meets program criteria as a policy document, an operations guide, a financial
plan, and a communications device.
The California Society of Municipal Finance Officers presented the District with the Certificate
of Award for Excellence in Operating Budgeting for Fiscal Year 2024-2025.
The California Society of Municipal Finance Officers presented the District with the Certificate
of Award for Excellence in Capital Budgeting for Fiscal Year 2024-2025.
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We want to thank all the staff involved for their efforts to prepare this Annual Comprehensive Financial
Report and their hard work to ensure a successful outcome. We would also like to thank the firm Davis
Farr LLP for their professional work and opinion.
To the Board of Directors, we acknowledge and appreciate the Board's continued support and
direction in achieving excellence in financial management.
Joseph R. Beachem
Chief Financial Officer
Jose Martinez
General Manager
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Organization Chart
District Position Count – (146 Positions)
Collection,
Treatment, and
Reclamation
Operations
District Secretary General Counsel
Public Information
Conservation
Citizens and
Customers Board of Directors
General Manager (4)
Safety and
Security
Administration
Purchasing
and Facilities
Controller and
Budgetary
Services
Treasury and
Accounting
Services
Customer
Service
Meter
Services
Water System
Operations
Utility
Maintenance/
Construction
Water Resources,
Planning, Design
and
Environmental
Administrative
Services
(23)
Human
Resources
Information
Technology
and
Geographic
Information
System
Finance
(33)
Strategic
Planning
Public Services
and
Field Services
Engineering
(29)
Water
Operations
(57)
xii
List of Principal Officials
Francisco X. Rivera
Treasurer
Division 1
Jose Lopez
President
Division 4
Gary Croucher
Vice President
Division 3
Delfina Gonzalez
Division 2
Board of Directors
The Otay Water District is a revenue-
neutral public agency established in
accordance with the California Water
Code. This not-for-profit status means
Otay has no private shareholders, pays no
dividends and therefore does not report
to, nor answer to the California Public
Utilities Commission. The District does,
however, answer to the public through a
five-member Board of Directors. Each
Director is elected by voters within their
respective division boundaries to
represent the public's interest with regard
to rates for service, taxes, policies,
ordinances, and other matters related to
the management and operation of the
Otay Water District. Directors serve four-
year alternating terms on the Board.
Mark Robak
Division 5
Mission Statement
To provide exceptional water and
wastewater service to its customers, and
to manage District resources in a
transparent and fiscally responsible
manner.
xiii
GFOA CERTIFICATE OF ACHIEVEMENT
FOR EXCELLENCE IN FINANCIAL REPORTING
The Government Finance Officers Association (GFOA) awarded a Certificate of
Achievement for Excellence in Financial Reporting to the Otay Water District for its
Annual Comprehensive Financial Report for the fiscal year ended June 30, 2024. This
is the twentieth year that the District has achieved this prestigious award. In order to
be awarded a Certificate of Achievement, the District had to publish an easily
readable and comprehensive report. This report must satisfy both Generally
Accepted Accounting Principles (GAAP) and applicable legal requirements.
This award is valid for a period of one year only. We believe our current Annual
Comprehensive Financial Report continues to meet the Certificate of Achievement
Program’s requirements, and will be submitting it to GFOA to determine its eligibility
for another certificate.
xiv
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 and 13 to the financial statements, during the year ended
June 30, 2025, the District implemented Governmental Accounting Standards Board (GASB)
Statement No. 101: Compensated Absences, which resulted in a prior period restatement.
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.
1
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.
2
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 Information
Management is responsible for the other information included in the Annual Comprehensive
Financial Report. The other information comprises the introductory section and statistical
section but does not include the financial statements and our auditor's report thereon. Our
opinions on the financial statements do not cover the other information, and we do not
express an opinion or any form of assurance thereon. In connection with our audit of the
financial statements,our responsibility is to read the other information and consider whether
a material inconsistency exists between the other information and the financial statements,
or the other information otherwise appears to be materially misstated.If,based on the work
performed, we conclude that an uncorrected material misstatement of the other information
exists, we are required to describe it in our report.
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
3
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.
4
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.
5
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.
6
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.
7
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 125.8 113.0
Non-operating Expenses 4.7 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 $27.7 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.
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.
8
Management’s Discussion and Analysis
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.
9
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
Additional information on the District's long-term debt can be found in Note 5 of the Notes to Financial
Statements.
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
10
Management’s Discussion and Analysis
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
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
11
Management’s Discussion and Analysis
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 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
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
12
Management’s Discussion and Analysis
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.
13
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14
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
STATEMENT OF NET POSITION
June 30, 2025
(with comparative totals as of June 30, 2024)
The accompanying notes are an integral part of this statement.
15
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 (Note 10)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$
(with comparative totals as of June 30, 2024)
STATEMENT OF NET POSITION - Continued
June 30, 2025
The accompanying notes are an integral part of this statement.
16
Statements of Revenues, Expenses, and Changes in Net Position
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$
For the Years Ended June 30, 2025 and 2024
The accompanying notes are an integral part of this statement.
17
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
Statements of Cash Flows
For the Years Ended June 30, 2025 and 2024
The accompanying notes are an integral part of this statement.
18
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
Right to Use Assets - SBITA - 5,499,767
For the Years Ended June 30, 2025 and 2024
Statements of Cash Flows - Continued
The accompanying notes are an integral part of this statement.
19
Notes to Financial Statements
Year Ended June 30, 2025
NOTE DESCRIPTION PAGE
1 Reporting Entity and Summary of Significant Accounting Policies..…………… 21 – 29
2 Cash and Investments……………………………………………………………………………..…………….. 29 – 35
3 Fair Value Measurements…………………………………………..………........................................ 35 – 36
4 Capital Assets…………………………………………………..………………………………………………………. 37
5 Long-Term Debt………………………………………………….…………………………………………………… 38 – 45
6 Net Position……………………………………………………………………………………………………………….. 46
7 Defined Benefit Pension Plan……………………………………………………………………………….. 46 – 53
8 Other Post Employment Benefits………………………..…………............................................ 53 – 58
9 Other Non-Current Liabilities…….………………………..…………............................................ 59
10 Commitments and Contingencies……………………………………………………………………... 59 – 61
11 Risk Management……………………………………………………………………………………………………. 61 – 62
12 Leases Receivable…..………………………………………………..……………………………………………. 62
13 Restatement………………………………………………………………..……………………………………………. 62 – 65
14 Segment Information………………………………………………………………………………...…………… 65
20
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.
21
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.
22
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.
23
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.
24
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.
25
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:
Sewer System 7-75 Years
Water System (Pot & Rec) 7-75 Years
Building and Improvements 5-50 Years
Field Equipment 3-25 Years
Communication Equipment 5-10 Years
Fleet Equipment 3-10 Years
Office Equipment 3-10 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.
26
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
27
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.
28
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.
29
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$
30
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.
31
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
32
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
33
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.
34
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.
35
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
36
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
37
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$
38
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 $1,982,858.
39
Notes to Financial Statements
Year Ended June 30, 2025
5) LONG-TERM DEBT – Continued
Water Revenue Bonds – Continued
The total amount outstanding at June 30, 2025 and aggregate maturities of the revenue bonds for the fiscal
years subsequent to June 30, 2025, are as follows:
For the Year
Ended June 30, Principal Interest
2026 1,365,000$ 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
40
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
41
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$
42
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.
43
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
44
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.
45
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.
46
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.
47
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)
48
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)
49
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)$
50
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 -
51
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.
52
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
53
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%
54
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)$
55
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$
56
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
57
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$
58
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.
59
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.
60
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 $2,083,057 of lease revenue during the fiscal year.
61
Notes to Financial Statements
Year Ended June 30, 2025
13) RESTATEMENT
During the year ended June 30, 2025, the District adopted new accounting guidance by implementing
the provisions of GASB 101. As a result of this implementation, additional compensated absences
resulted from the addition of payroll-related taxes and benefits associated with the accrued leave. The
following summarizes the net effects on beginning net position:
14) SEGMENT INFORMATION
The District has issued Water and Wastewater Revenue Bonds in the previous fiscal years to finance
certain capital improvements. While water and wastewater services are accounted for jointly in these
financial statements, the investors in the Water Revenue Bonds rely solely on the revenues of the water
services for repayment and the Wastewater Revenue Bonds solely on the revenues of the wastewater
services for repayment.
Summary of financial information for the water and wastewater services is presented for June 30, 2025
on the following pages:
Total Net Position, Beginning, as Previously Reported 404,274,141$
Restatement for Implementation of GASB 101 (233,092)
Total Net Position, Beginning, as Restated 404,041,049$
62
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
63
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
64
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$
65
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66
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.
67
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 benefits.
68
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.
69
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.
70
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.
71
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.
72
Statistical Schedules
The Statistical Schedule is part of understanding what the information in the financial statements, note
disclosures, and required supplementary information says about the District’s overall financial health.
Contents Page
Financial Trends 74
These schedules contain trend information to help the reader understand how the
District’s financial performance and well-being have changed over time.
Revenue Capacity 81
These schedules contain information to help the reader assess the factors affecting the
District’s ability to generate its potable and recycled water, and sewer sales as well as
property tax.
Debt 92
These schedules present information to help the reader assess the affordability of the
District’s current levels of outstanding debt and the District’s ability to issue additional
debt.
Demographic and Economic Information 98
These schedules offer demographic and economic indicators to help the reader
understand the environment within which the District’s financial activities take place
and to help make comparisons over time and with other governments.
Operating Information 100
These schedules contain information about the District’s operation and resources to
help the reader understand how the District’s financial information relates to the
services the District provides and the activities it performs.
Sources
Unless otherwise noted, the information in these schedules is derived from the annual comprehensive
financial reports of the relevant year.
73
Fiscal Net Investment Total
Year in Capital Assets Restricted Unrestricted Net Position
2025 351,783,163$ 6,964,548$ 71,520,791$ 430,268,502$ (1)
2024 336,050,508 6,719,961 61,270,580 404,041,049 (2)
2023 341,227,728 6,522,740 83,324,561 431,075,029
2022 340,274,496 9,712,242 74,736,049 424,722,787
2021 340,383,389 4,187,443 60,680,243 405,251,075
2020 345,156,470 4,261,399 38,048,894 387,466,763
2019 354,639,520 4,248,007 28,707,083 387,594,610
2018 355,628,577 4,247,025 27,664,926 387,540,528 (3)
2017 350,981,714 4,306,724 45,898,551 401,186,989
2016 351,617,201 4,402,301 45,268,275 401,287,777
(1)For the fiscal year ending June 30, 2025, the increase of $26.2 million in the total net position includes a $15 million
reduction in the accrual for the estimated litigation-related expense recorded in fiscal year ending June 30, 2024
that is noted in footnote 2.
(2)For the fiscal year ending June 30, 2024, the $26.8 million decrease in total net position is primarily due to the accrual
of an estimated litigation-related expense of $27 million. FY 2024 net position was restated by ($233) thousand due to
GASB 101 implementation.
(3)For Fiscal Year ending June 30, 2018, the $13.6 million decrease in total net position is primarily a result of the
implementation of GASB Statement No. 75 "Accounting and Financial Reporting for Postemployment Benefits Other
Than Pensions-an amendment of GASB Statement No. 45”. Implementation of this standard decreased the net
position at July 1, 2017 by $17.8 million and recognized a net OPEB liability, deferred outflows of resources, and
expenses related to the OPEB plan.
Source: Otay Water District
Net Position by Component - Last Ten Fiscal Years
$0
$50,000
$100,000
$150,000
$200,000
$250,000
$300,000
$350,000
$400,000
$450,000
$500,000
2016 2017 2018 2019 2020 2021 2022 2023 2024 2025
Total Net Position, in Thousands ($)
74
Water & Certificate of Water Revenue Deferred Net
Fiscal Capital Assets Wastewater Participation Refunding GO Capital Related Unamortized Unamortized Amount on Investment in
Year Net Revenue Bonds (COPS) Bonds Bonds Payable (1)Premium Discount Refunding Capital Assets
2025 447,268,508$ (62,865,000)$ -$ (22,600,000)$ -$(6,054,584)$ (3,976,905)$ 11,144$ -$ 351,783,163$
2024 436,887,160 (65,965,000) - (24,020,000) - (6,580,032) (4,283,225) 11,605 - 336,050,508
2023 443,451,773 (68,925,000) - (26,205,000) - (2,444,750) (4,661,361) 12,066 - 341,227,728
2022 446,747,676 (71,625,000) - (28,295,000) (720,000) (723,401) (5,122,306) 12,527 - 340,274,496
2021 451,562,404 (73,885,128) - (30,285,000) (1,425,000) - (5,596,875) 12,988 - 340,383,389
2020 456,522,770 (71,018,303) - (32,185,000) (2,105,000) - (6,071,446) 13,449 - 345,156,470
2019 458,309,347 (60,368,810) - (34,000,000) (2,755,000) - (6,546,017)- - 354,639,520
2018 450,850,563 (44,235,000) (7,600,000) (35,730,000) (3,390,000) - (4,273,693) 6,707 - 355,628,577
2017 450,196,950 (45,175,000) (8,200,000) (37,405,000) (3,995,000) - (4,639,116) 7,452 191,428 350,981,714
2016 453,968,546 (46,075,000) (8,800,000) (39,240,000) (4,580,000) - (5,004,539) 8,197 1,339,997 351,617,201
(1) Includes other capital borrowing and liabilities, such as lease and SBITA payable and accounts and retainage payable for capital purposes.
Source: Otay Water District
Net Investment in Capital Assets - Last Ten Fiscal Years
$325,000
$330,000
$335,000
$340,000
$345,000
$350,000
$355,000
$360,000
2016 2017 2018 2019 2020 2021 2022 2023 2024 2025
Net Investment in Capital Assets, in Thousands ($)
75
Total Income/
Operating Non-Operating (Loss) Before Changes
Fiscal Operating Operating Income/Revenues/Capital Capital in Net
Year Revenues Expenses (Loss)(Expenses) Contributions Contributions Position
2025 128,786,639$ 144,040,689$ (15,254,050)$ 27,293,873$ (1)12,039,823$ 14,187,630$ 26,227,453$
2024 112,485,133 131,202,044 (18,716,911) (15,552,263)
(2)(34,269,174) 7,468,286 (26,800,888)
2023 106,192,423 118,793,915 (12,601,492) 9,716,538 (2,884,954) 9,237,196 6,352,242
2022 108,754,598 109,227,308 (472,710) 6,675,262 6,202,552 13,269,160 19,471,712
2021 107,140,468 108,684,323 (1,543,855) 7,575,379 6,031,524 11,752,788 17,784,312
2020 95,938,809 106,987,896 (11,049,087) 3,979,308 (7,069,779) 6,941,932 (127,847)
2019 91,952,166 103,728,988 (11,776,822) 2,374,095 (9,402,727) 9,456,809 54,082
2018 97,473,772 105,734,349 (8,260,577) 2,923,999 (5,336,578) 9,506,192 4,169,614
2017 88,481,254 96,624,381 (8,143,127) 2,471,420 (5,671,707) 5,570,919 (100,788)
2016 78,876,307 89,669,543 (10,793,236) 2,687,368 (8,105,868) 6,971,319 (1,134,549)
(1) For the fiscal year ending June 30, 2025, non-operating revenues/(expenses) include a $15 million reduction in the
accrual for the estimated litigation-related expense recorded in fiscal year ending June 30, 2024 as noted in footnote 2.
(2)Non-operating revenues/(expenses) include the accrual of an estimated litigation-related expense of ($27) million.
Source: Otay Water District
Changes in Net Position - Last Ten Fiscal Years
-$30,000
-$20,000
-$10,000
$0
$10,000
$20,000
$30,000
2016 2017 2018 2019 2020 2021 2022 2023 2024 2025
Changes in Net Position, in Thousands ($)
76
Fiscal Connection and Percent
Year Water Sales Wastewater Other Fees Total Change
2025 121,483,491$ 3,500,945$ 3,802,203$ 128,786,639$ 14.5%
2024 105,736,843 3,494,312 3,253,978 112,485,133 5.9%
2023 99,901,174 3,315,754 2,975,495 106,192,423 -2.4%
2022 102,807,098 3,073,326 2,874,174 108,754,598 1.5%
2021 101,742,970 2,899,180 2,498,318 107,140,468 11.7%
2020 90,435,148 2,921,310 2,582,351 95,938,809 4.3%
2019 86,756,222 2,961,157 2,234,787 91,952,166 -5.7%
2018 92,595,195 2,865,520 2,013,057 97,473,772 10.2%
2017 83,720,150 2,983,495 1,777,609 88,481,254 12.2%
2016 73,940,200 3,175,300 1,760,807 78,876,307 -5.9%
Source: Otay Water District
Operating Revenues by Source - Last Ten Fiscal Years
$0
$20,000
$40,000
$60,000
$80,000
$100,000
$120,000
$140,000
2016 2017 2018 2019 2020 2021 2022 2023 2024 2025
Operating Revenues, in Thousands ($)
77
Fiscal Cost of Administrative Percent
Year Water Sales Wastewater and General Depreciation Total Change
2025 89,595,836$ 2,578,457$ 33,449,222$ 18,417,174$ 144,040,689$ 9.8%
2024 77,807,009 2,400,881 32,717,662 18,276,492 131,202,044 10.4%
2023 71,342,741 2,497,316 27,073,523 17,880,335 118,793,915 8.8%
2022 70,562,038 1,802,256 19,174,479 17,688,535 109,227,308 0.5%
2021 66,889,570 2,633,413 21,948,435 17,212,905 108,684,323 1.6%
2020 62,573,257 2,439,117 25,196,555 16,778,967 106,987,896 3.1%
2019 60,065,964 2,784,579 24,070,648 16,807,797 103,728,988 -1.9%
2018 62,321,213 2,501,240 23,445,578 17,466,318 105,734,349 9.4%
2017 56,882,487 1,964,855 19,991,542 17,785,497 96,624,381 7.8%
2016 51,826,046 2,051,913 19,318,247 16,473,337 89,669,543 -2.4%
Source: Otay Water District
Operating Expenses by Function - Last Ten Fiscal Years
$0
$20,000
$40,000
$60,000
$80,000
$100,000
$120,000
$140,000
$160,000
2016 2017 2018 2019 2020 2021 2022 2023 2024 2025
Operating Expenses, in Thousands ($)
Cost of Water Sales Wastewater Administrative and General Depreciation
78
Fiscal Investment Taxes and Availability Rents and Percent
Year Earnings (Losses) Assessments Charges Leases Miscellaneous Total Change
2025 5,998,937$ 6,171,087$ 717,191$ 2,083,057$ 17,097,575$ (1)32,067,847$ 89.8%
2024 6,393,523 5,777,012 741,705 2,083,669 1,896,115 16,892,024 16.0%
2023 4,088,331 5,618,253 710,954 2,181,634 1,961,168 14,560,340 21.7%
2022 (1,506,486) 5,244,584 740,928 2,071,200 5,417,588 11,967,814 -6.8%
2021 254,668 5,251,540 686,697 1,587,687 5,062,779 12,843,371 18.3%
2020 1,784,834 4,939,950 694,768 1,501,328 1,936,162 10,857,042 -6.1%
2019 1,978,392 4,671,182 723,246 1,384,211 2,800,613 11,557,644 20.4%
2018 723,860 4,481,719 697,724 1,439,247 2,255,605 9,598,155 -10.6%
2017 408,754 4,114,583 729,325 1,375,305 4,107,558 10,735,525 20.7%
2016 758,004 3,966,593 616,591 1,281,150 2,274,623 8,896,961 -0.6%
(1)For the fiscal year ending June 30, 2025, miscellaneous revenues include a $15 million reduction in the accrual for the estimated
litigation-related expense recorded in fiscal year ending June 30, 2024, as noted on page 80, footnote 3.
Source: Otay Water District
Non-Operating Revenues by Source - Last Ten Fiscal Years
$0
$5,000
$10,000
$15,000
$20,000
$25,000
$30,000
$35,000
2016 2017 2018 2019 2020 2021 2022 2023 2024 2025
Non-Operating Revenues, in Thousands ($)
79
Fiscal Interest Percent
Year Donations (1)Expense Miscellaneous Total Change
2025 97,105$ 4,054,293$ 622,576$ (2)4,773,974$ -85.3%
2024 103,200 4,137,615 28,203,472 (3)32,444,287 569.8%
2023 92,000 4,310,352 441,450 (4)4,843,802 -8.5%
2022 106,913 4,551,134 634,505 (5)5,292,552 0.5%
2021 84,389 4,782,490 401,113 (6)5,267,992 -23.4%
2020 121,600 4,953,987 1,802,147 (7)6,877,734 -25.1%
2019 118,040 4,713,883 4,351,626 (8)9,183,549 37.6%
2018 123,050 3,941,321 2,609,785 6,674,156 -19.2%
2017 125,742 5,069,767 3,068,596 (9)8,264,105 33.1%
2016 120,722 4,603,093 1,485,778 6,209,593 3.7%
(1) Donations are contributions to the Water Conservation Authority formed in 1999.
(2) Miscellaneous expense includes $0.4 million of non-capitalizable expenses which were partially funded by capacity revenue
and $0.2 million loss on disposal of capital assets.
(3) Miscellaneous expenses include $0.5 million of non-capitalizable expenses that were partially funded by capacity revenue,
the disposal of capital assets resulting in a loss of $0.7 million, and the accrual of an estimated litigation-related expense
of $27 million. See Note 10 on pages 58-59 for further explanation.
(4) Miscellaneous expense includes $0.3 million of non-capitalizable expenses which were partially funded by capacity revenue
and $0.1 million loss on disposal of capital assets.
(5) Miscellaneous expense includes $0.4 million of non-capitalizable expenses which were partially funded by capacity revenue
and $0.2 million loss on disposal of capital assets.
(6) Miscellaneous expense includes $0.2 million of non-capitalizable expenses which were partially funded by capacity revenue
and $0.2 million loss on disposal of capital assets.
(7) Miscellaneous expense includes $0.4 million of non-capitalizable expenses which were partially funded by capacity revenue
and $1.2 million loss on disposal of capital assets.
(8) Miscellaneous expense includes $3.0 million of non-capitalizable expenses which were partially funded by capacity revenue
and $1.1 million loss on disposal of capital assets.
(9) Miscellaneous expense includes $1.8 million of non-capitalizable expenses which were primarily funded by capacity revenue.
Source: Otay Water District
Non-Operating Expenses by Function - Last Ten Fiscal Years
$0
$5,000
$10,000
$15,000
$20,000
$25,000
$30,000
$35,000
2016 2017 2018 2019 2020 2021 2022 2023 2024 2025
Non-Operating Expenses, in Thousands ($)
Miscellaneous Interest Expense Donations
80
Fiscal Total Direct
Year Real Personal Total Tax Rate
2025 43,914,269,523$ 566,515,800$ 44,480,785,323$ 1.00%
2024 41,107,046,948 567,270,100 41,674,317,048 1.00%
2023 38,290,356,481 581,683,100 38,872,039,581 1.00%
2022 35,535,165,581 690,058,250 36,225,223,831 1.00%
2021 33,891,881,238 675,894,658 34,567,775,896 1.00%
2020 32,068,524,548 570,816,478 32,639,341,026 1.00%
2019 30,175,832,441 591,916,883 30,767,749,324 1.00%
2018 28,808,597,510 578,765,787 29,387,363,297 1.00%
2017 27,060,627,238 538,359,438 27,598,986,676 1.00%
2016 25,506,243,489 551,455,064 26,057,698,553 1.00%
Source: County of San Diego Auditor and Controller
Last Ten Fiscal Years
Assessed Valuation of Taxable Property within the District -
$0
$5,000,000
$10,000,000
$15,000,000
$20,000,000
$25,000,000
$30,000,000
$35,000,000
$40,000,000
$45,000,000
2016 2017 2018 2019 2020 2021 2022 2023 2024 2025
Assessed Valuation of Property, In Thousands ($)
81
Fiscal
Year Purchases Sales Production Purchases Sales
2025 12,800,890 12,121,113 423,800 1,396,412 1,793,894
2024 11,959,703 11,268,054 426,020 969,274 1,391,760
2023 11,659,139 11,235,904 381,240 1,071,607 1,428,385
2022 12,906,784 12,310,217 436,600 1,279,005 1,685,259
2021 13,079,077 12,604,100 281,830 1,598,358 (2)1,799,377
2020 11,995,858 11,390,483 382,670 1,070,079 (3)1,451,957
2019 11,928,819 11,326,752 323,690 1,168,780 1,462,632
2018 12,910,269 12,227,383 377,450 1,460,271 1,810,502
2017 11,762,115 11,250,331 242,800 1,386,600 1,625,768
2016 11,108,105 10,475,290 439,650 1,163,117 1,591,677
(1)Rates are not presented on this schedule because the District has multiple water rates for various meter sizes
and customer classes and cannot represent rates in a meaningful manner with a weighted average rate.
See Water and Sewer rates on pages 86-90 for meter sizes and their corresponding water rates.
(2)In FY 2021, recycled water purchases from the City of San Diego increased due to the District's plant being shut
down from November 2020 through February 2021 for capital improvements.
(3)In FY 2020, recycled water purchases from the City of San Diego declined due to the City's plant being shut
down from January to June of 2020.
Source: Otay Water District
Per 100 Cubic Feet
Water Purchases, Production, and Sales -
Last Ten Fiscal Years
Recycled Water(1)
Per 100 Cubic Feet
Potable Water(1)
0
5,000,000
10,000,000
15,000,000
20,000,000
2016 2017 2018 2019 2020 2021 2022 2023 2024 2025
Recycled Purchases Recycled Production Potable Purchases
Water Purchases, Productions, and Sales, in Hundred Cubic Feet (HCF)
82
Fiscal
Year Total(1)
2025 147 13 160
2024 171 13 184
2023 203 21 224
2022 200 18 218
2021 270 27 297
2020 302 4 306
2019 463 12 475
2018 574 14 588
2017 109 9 118
2016 116 4 120
(1) Meters may not be activated in the year sold.
Source: Otay Water District
Meter Sales by Type - Last Ten Fiscal Years
Potable Recycled
0
200
400
600
2016 2017 2018 2019 2020 2021 2022 2023 2024 2025
Meter Sales by Type
Recycled Potable
83
Fiscal
Year Potable Recycled Sewer Total
2025 52,007 809 4,757 57,573
2024 51,853 798 4,750 57,401
2023 51,604 782 4,744 57,130
2022 51,389 768 4,738 56,895
2021 51,204 753 4,736 56,693
2020 50,994 735 4,737 56,466
2019 50,555 726 4,737 56,018
2018 50,045 724 4,714 55,483
2017 49,502 721 4,683 54,906
2016 49,425 708 4,677 54,810
Source: Otay Water District
Number of Customers by Service Type - Last Ten Fiscal Years
0
7,500
15,000
22,500
30,000
37,500
45,000
52,500
60,000
2016 2017 2018 2019 2020 2021 2022 2023 2024 2025
Number of Customers by Service Type
Potable Sewer Recycled
84
Fiscal
Year 1% Property Tax
Special
Assessments
Total
Levies
Total
Collections (1)
End of the Year
Percent
Collected
2025 $ 6,107,169 $ 1,294,075 $ 7,401,244 $ 7,317,009 99%
2024 5,711,012 1,349,214 7,060,226 7,001,401 99%
2023 5,261,764 1,642,529 6,904,293 6,808,246 99%
2022 4,737,353 2,134,710 6,872,063 6,642,853 97%
2021 4,469,198 2,007,723 6,476,921 6,377,533 98%
2020 4,203,245 2,013,450 6,216,694 6,122,835 98%
2019 4,036,261 2,023,939 6,060,200 5,955,998 98%
2018 3,795,363 1,960,771 5,756,134 5,691,467 99%
2017 3,539,836 1,999,480 5,539,316 5,532,395 100%
2016 3,367,615 1,998,874 5,366,489 5,127,563 96%
(1)Levies and collections include Current Secured, Current Unsecured, and Supplemental Homeowners Exemptions.
Source: Otay Water District
Property Tax Levies and Collections - Last Ten Fiscal Years
$0
$1,000
$2,000
$3,000
$4,000
$5,000
$6,000
$7,000
$8,000
2016 2017 2018 2019 2020 2021 2022 2023 2024 2025
Levies and Collections, in Thousands ($)
Levies Collections
85
Fixed Rates 2025 2024 2023 2022 2021 2020 2019 2018 2017 2016
System Charge by Meter Size
Residential Potable
¾"21.16$ 19.24$ 18.07$ 20.08$ 19.27$ 18.87$ 18.05$ 17.38$ 15.91$ 18.91$
1"26.31 23.92 22.47 28.39 27.24 26.67 25.51 24.56 22.47 26.71
1 ½"39.49 35.91 33.73 49.11 47.12 46.13 44.13 42.49 38.88 46.22
2"55.07 50.07 47.04 73.98 70.98 69.49 66.47 64.00 58.55 69.61
¾"19.52 17.75 16.67 44.17 42.38 41.49 39.69 38.21 15.91 18.91
1"23.58 21.44 20.14 62.37 59.84 58.59 56.05 53.97 22.47 26.71
1 ½"34.02 30.93 29.06 107.92 103.55 101.38 96.98 93.37 38.88 46.22
2"46.34 42.13 39.58 162.53 155.94 152.67 146.04 140.61 58.55 69.61
3"97.86 88.98 83.59 308.22 295.73 289.53 276.96 266.66 111.04 132.02
4"164.90 149.93 140.85 472.17 453.03 443.54 424.28 408.50 170.10 202.24
6"323.58 294.21 276.38 927.63 890.03 871.38 833.54 802.55 334.18 397.31
8"499.58 454.24 426.72 1,474.12 1,414.36 1,384.73 1,324.59 1,275.34 531.05 631.37
10"766.07 696.54 654.34 2,111.67 2,026.07 1,983.62 1,897.47 1,826.91 760.72 904.44
¾"21.34 19.40 18.22 41.61 39.92 39.08 37.38 35.99 15.91 18.91
1"26.60 24.19 22.72 58.75 56.37 55.19 52.79 50.83 22.47 26.71
1 ½"40.07 36.43 34.22 101.66 97.54 95.50 91.35 87.95 38.88 46.22
2"55.98 50.90 47.82 153.11 146.90 143.82 137.57 132.45 58.55 69.61
3"118.97 108.17 101.62 290.34 278.57 272.73 260.89 251.19 111.04 132.02
4"202.89 184.48 173.30 444.76 426.73 417.79 399.65 384.79 170.10 202.24
6"408.01 370.98 348.50 873.81 838.39 820.82 785.17 755.97 334.18 397.31
8"644.35 585.87 550.37 1,388.56 1,332.27 1,304.36 1,247.71 1,201.32 531.05 631.37
10"995.27 904.94 850.11 1,989.08 1,908.45 1,868.46 1,787.32 1,720.86 760.72 904.44
¾"19.86 18.06 16.97 41.61 39.92 39.08 37.38 35.99 15.91 18.91
1"24.16 21.97 20.64 58.75 56.37 55.19 52.79 50.83 22.47 26.71
1 ½"35.19 32.00 30.06 101.66 97.54 95.50 91.35 87.95 38.88 46.22
2"48.22 43.84 41.18 153.11 146.90 143.82 137.57 132.45 58.55 69.61
3"101.95 92.70 87.08 290.34 278.57 272.73 260.89 251.19 111.04 132.02
4"172.26 156.63 147.14 444.76 426.73 417.79 399.65 384.79 170.10 202.24
6"339.94 309.09 290.36 873.81 838.39 820.82 785.17 755.97 334.18 397.31
8"527.68 479.79 450.72 1,388.56 1,332.27 1,304.36 1,247.71 1,201.32 531.05 631.37
10"810.53 736.97 692.32 1,989.08 1,908.45 1,868.46 1,787.32 1,720.86 760.72 904.44
¾"18.88 17.17 16.13 35.13 33.71 33.00 31.57 30.40 15.91 18.91
1"22.52 20.48 19.24 49.62 47.61 46.61 44.59 42.93 22.47 26.71
1 ½"31.92 29.02 27.26 85.86 82.38 80.65 77.15 74.28 38.88 46.22
2"42.96 39.06 36.69 129.28 124.04 121.44 116.17 111.85 58.55 69.61
3"90.46 82.25 77.26 245.19 235.25 230.32 220.32 212.13 111.04 132.02
4"151.59 137.83 129.48 375.63 360.40 352.85 337.53 324.98 170.10 202.24
6"293.97 267.29 251.10 737.94 708.03 693.20 663.10 638.44 334.18 397.31
8"448.88 408.14 383.41 1,172.69 1,125.15 1,101.58 1,053.74 1,014.56 531.05 631.37
10"685.76 623.52 585.74 1,679.86 1,611.76 1,577.99 1,509.46 1,453.33 760.72 904.44
Water Fixed Rates - Last Ten Fiscal Years
Non-Public Irrigation and Commercial Agricultural Potable
Business & Commercial Potable
Multi-Residential Potable
Public Agency Potable
86
Fixed Rates 2025 2024 2023 2022 2021 2020 2019 2018 2017 2016
Water Fixed Rates - Last Ten Fiscal Years
System Charge by Meter Size
¾"18.88$ 17.17$ 16.13$ 35.13$ 33.71$ 33.00$ 31.57$ 30.40$ 15.91$ 18.91$
1"22.52 20.48 19.24 49.62 47.61 46.61 44.59 42.93 22.47 26.71
1 ½"31.92 29.02 27.26 85.86 82.38 80.65 77.15 74.28 38.88 46.22
2"42.96 39.06 36.69 129.28 124.04 121.44 116.17 111.85 58.55 69.61
3"90.46 82.25 77.26 245.19 235.25 230.32 220.32 212.13 111.04 132.02
4"151.59 137.83 129.48 375.63 360.40 352.85 337.53 324.98 170.10 202.24
¾"19.41 17.65 16.58 35.13 33.71 33.00 31.57 30.40 15.91 18.91
1"23.39 21.27 19.98 49.62 47.61 46.61 44.59 42.93 22.47 26.71
1 ½"33.65 30.60 28.75 85.86 82.38 80.65 77.15 74.28 38.88 46.22
2"45.76 41.61 39.09 129.28 124.04 121.44 116.17 111.85 58.55 69.61
3"96.60 87.83 82.51 245.19 235.25 230.32 220.32 212.13 111.04 132.02
4"162.63 147.87 138.91 375.63 360.40 352.85 337.53 324.98 170.10 202.24
6"318.54 289.63 272.08 737.94 708.03 693.20 663.10 638.44 334.18 397.31
8"490.98 446.42 419.37 1,172.69 1,125.15 1,101.58 1,053.74 1,014.56 531.05 631.37
10"752.42 684.13 642.67 1,679.86 1,611.76 1,577.99 1,509.46 1,453.33 760.72 904.44
¾"40.64 38.39 36.06 43.74 41.54 40.21 38.14 36.85 15.91 18.91
1"55.03 51.98 48.83 61.76 58.65 56.78 53.86 52.04 22.47 26.71
1 ½"91.54 86.46 81.22 106.89 101.51 98.27 93.21 90.06 38.88 46.22
2"134.94 127.46 119.74 160.98 152.88 148.00 140.38 135.63 58.55 69.61
3"295.75 279.35 262.42 305.28 289.91 280.65 266.21 257.21 111.04 132.02
4"516.16 487.54 458.00 467.65 444.11 429.92 407.80 394.01 170.10 202.24
6"1,074.47 1,014.90 953.41 918.73 872.49 844.62 801.16 774.07 334.18 397.31
8"1,659.03 1,567.04 1,547.17 1,459.97 1,386.49 1,342.20 1,273.13 1,230.08 531.05 631.37
10"2,717.75 2,567.06 2,411.52 2,091.41 1,986.14 1,922.69 1,823.75 1,762.08 760.72 904.44
¾"40.64 38.39 36.06 36.93 35.07 33.95 32.20 31.11 15.91 18.91
1"55.03 51.98 48.83 52.16 49.53 47.95 45.48 43.94 22.47 26.71
1 ½"91.54 86.46 81.22 90.25 85.71 82.97 78.70 76.04 38.88 46.22
2"134.94 127.46 119.74 135.90 129.06 124.94 118.51 114.50 58.55 69.61
3"295.75 279.35 262.42 257.73 244.76 236.94 224.75 217.15 111.04 132.02
4"516.16 487.54 458.00 394.84 374.97 362.99 344.31 332.67 170.10 202.24
6"1,074.47 1,014.90 953.41 787.55 747.91 724.02 686.76 663.54 334.18 397.31
8"1,659.03 1,567.04 1,547.17 1,232.66 1,170.62 1,133.22 1,074.91 1,038.56 531.05 631.37
10"2,717.75 2,567.06 2,411.52 1,765.77 1,676.89 1,623.32 1,539.79 1,487.72 760.72 904.44
Line Size ¾"3.05 2.77 2.60 24.00 23.03 22.55 21.57 20.77 20.77 24.69
Line Size 1"3.13 2.85 2.68 24.00 23.03 22.55 21.57 20.77 20.77 24.69
Line Size 1 ½"3.44 3.13 2.94 24.00 23.03 22.55 21.57 20.77 20.77 24.69
Line Size 2"3.95 3.59 3.38 24.00 23.03 22.55 21.57 20.77 20.77 24.69
Line Size 3"5.84 5.31 4.99 24.00 23.03 22.55 21.57 20.77 20.77 24.69
Line Size 4"9.07 8.25 7.75 32.34 31.03 30.38 29.06 27.98 27.98 33.27
Line Size 6"20.71 18.83 17.69 32.34 31.03 30.38 29.06 27.98 27.98 33.27
Line Size 8"40.78 37.08 34.83 32.34 31.03 30.38 29.06 27.98 27.98 33.27
Line Size 10"70.95 64.51 60.61 32.34 31.03 30.38 29.06 27.98 27.98 33.27
Fire Services Potable
Recycled Irrigation
Recycled Commercial
Construction Potable
Public Irrigation Potable
87
Fixed Rates 2025 2024 2023 2022 2021 2020 2019 2018 2017 2016
Water Fixed Rates - Last Ten Fiscal Years
CWA and MWD Pass-through Charges by Meter Size
Residential Potable
¾"21.37$ 17.19$ 16.33$ 17.00$ 16.36$ 15.56$ 15.10$ 15.45$ 15.00$ 16.84$
1"35.61 28.65 27.22 31.57 30.38 28.89 28.04 28.68 27.84 31.24
1 ½"71.19 57.27 54.42 71.36 68.67 65.31 63.40 64.85 62.96 70.66
Non-Residential & Other Potable
¾"21.37 17.19 16.33 17.00 16.36 15.56 15.10 15.45 15.00 16.84
1"35.61 28.65 27.22 31.57 30.38 28.89 28.04 28.68 27.84 31.24
1 ½"71.19 57.27 54.42 71.36 68.67 65.31 63.40 64.85 62.96 70.66
2"113.89 91.62 87.06 121.39 116.81 111.10 107.84 110.30 107.08 120.17
3"249.15 200.43 190.45 258.17 248.44 236.29 229.36 234.60 227.75 255.60
4"448.47 360.77 342.81 413.41 397.83 378.38 367.29 375.68 364.72 409.32
6"996.61 801.71 761.79 846.28 814.38 774.56 751.85 769.02 746.59 837.89
8"1,708.44 1,374.34 1,305.91 1,366.65 1,315.14 1,250.83 1,214.16 1,241.89 1,205.65 1,353.09
10"2,705.04 2,176.04 2,067.69 1,967.12 1,892.97 1,800.41 1,747.63 1,787.55 1,735.39 1,947.62
Source: Otay Water District
88
Water Rate 2025 2024 2023 2022 2021 2020 2019 2018(1)2017 2016
Tier 1 (conservation tier)-$ -$ -$ -$ -$ -$ -$ -$ 2.53$ 2.13$
Tier 2 6.16 5.60 5.26 3.52 3.38 3.31 3.17 3.05 3.95 3.32
Tier 3 6.69 6.08 5.71 6.30 6.04 5.91 5.65 5.44 5.13 4.32
Tier 4 7.43 6.76 6.35 8.12 7.79 7.63 7.30 7.03 7.90 6.65
Tier 1 6.11 5.56 5.22 3.29 3.16 3.09 2.96 2.85 3.90 3.28
Tier 2 6.61 6.01 5.65 5.97 5.73 5.61 5.37 5.17 5.05 4.25
Tier 3 6.85 6.23 5.85 7.35 7.05 6.90 6.60 6.35 7.80 6.56
Tier 1 6.47 5.88 5.52 4.17 4.00 3.92 3.75 3.61 4.17 3.51
Tier 2 4.23 3.56
Tier 3 4.30 3.62
Government Fee(2)- - - 0.43 0.42 0.42 0.42 0.41 0.41 0.37
Tier 1 7.12 6.47 6.08 4.17 4.00 3.92 3.75 3.61 4.17 3.51
Tier 2 4.23 3.56
Tier 3 4.30 3.62
Tier 1 7.45 6.77 6.36 6.09 5.84 5.72 5.47 5.27 5.68 4.78
Tier 2 5.74 4.83
Tier 3 5.81 4.89
Government Fee(2)- - - 0.43 0.42 0.42 0.42 0.41 0.41 0.37
Tier 1 8.13 7.39 6.94 6.09 5.84 5.72 5.47 5.27 5.68 4.78
Tier 2 5.74 4.83
Tier 3 5.81 4.89
Tier 1 7.40 6.73 6.32 6.09 5.84 5.72 5.47 5.27 5.68 4.78
Tier 2 5.74 4.83
Tier 3 5.81 4.89
Tier 1 5.55 5.24 4.92 3.58 3.40 3.29 3.12 3.01 3.53 2.97
Tier 2 3.60 3.03
Tier 3 3.65 3.07
Tier 1 6.05 5.71 5.36 5.05 4.80 4.65 4.41 4.26 4.85 4.08
Tier 2 4.92 4.14
Tier 3 4.99 4.20
Government Fee(2)- - - 0.43 0.42 0.42 0.42 0.41 0.41 0.37
Tier 1 6.16 5.82 5.47 5.05 4.80 4.65 4.41 4.26 4.85 4.08
Tier 2 4.92 4.14
Tier 3 4.99 4.20
Energy Pumping Fee (4)
Potable 0.109 0.075 0.068 0.063 0.063 0.060 0.056 0.053 0.044 0.072
Recycled 0.125 0.089 0.077 0.063 0.063 0.060 0.056 0.053 0.044 0.072
(1) Effective 2018, there is no conservation tier for residential customer class and only one tier for all non-residential customer classes.
(2) An additional charge per unit was assessed to governmental customers in lieu of tax revenues. This fee was eliminated in 2023.
(3) This classification was created in Fiscal Year 2016, prior to this the customers paid the Recycled Non-Public Irrigation Rate.
(4) Water customers are charged an energy pumping charge based on the quantity of water used and the elevation to which the water has been lifted to provide
service. The energy pumping charge is the rate per 100 cubic feet of water for each 100 feet of lift above the base elevation of 450 feet. All water customers are
in one of twenty-nine zones based on elevation.
Source: Otay Water District
Recycled Public Irrigation
Construction
Water Variable Rates - Last Ten Fiscal Years
Recycled Non-Public Irrigation
Recycled Commercial(3)
Business & Commercial
Non-Public Irrigation and Commercial Agricultural
Multi Residential
Residential
Public Agency
Public Irrigation
89
Description 2025 2024 2023 2022 2021* 2020 2019 2018 2017 2016
Per Unit 3.56$ 3.40$ 3.25$ 3.11$ 2.96$ 2.93$ 2.67$ 2.77$ 2.58$ 2.46$
Low Strength 3.56 3.40 3.25 3.11 2.96 2.93 2.67 2.77 2.58 2.46
Medium Strength 4.05 3.87 3.69 3.54 3.37 3.64 3.31 3.98 3.70 3.53
High Strength 5.70 5.45 5.20 4.98 4.75 5.01 4.56 6.34 5.90 5.63
¾" & 1"19.87 18.99 18.13 17.37 16.55 16.38 14.91 17.08 15.89 27.07
¾"19.87 18.99 18.13 17.37 16.55 16.38 14.91 30.50 28.37 27.07
1"49.64 47.45 45.30 43.41 41.36 40.94 37.27 44.94 41.80 39.86
1 ½"99.25 94.88 90.58 86.80 82.71 81.88 74.55 80.92 75.27 71.82
2"158.8 151.80 144.92 138.88 132.33 131.00 119.27 124.12 115.46 110.17
3"297.77 284.65 271.74 260.41 248.13 245.64 223.64 224.93 209.24 199.66
4"496.28 474.41 452.90 434.02 413.55 409.40 372.73 368.97 343.23 327.51
6"992.56 948.82 905.79 868.03 827.09 818.79 745.45 729.04 678.18 647.12
8"1588.12 1,518.13 1,449.29 1,388.87 1,323.36 1,310.08 1,192.73 1,161.15 1,080.14 1,030.67
10"2282.91 2,182.31 2,083.35 1,996.50 1,902.34 1,883.23 1,714.54 1,665.25 1,549.07 1,478.12
Calculation of Monthly Residential Sewer Billing:
Bill calculation beginning calendar year 2008: (Winter Average(1) x .85(2) x Sewer Rate) + Fixed Rate(3)
*Bill calculation beginning calendar year 2021: (3-Year Winter Average(4) x .85 (2) x Sewer Rate) + Fixed Rate(3)
Calculation of Monthly Non-Residential Sewer Billing:
Footnotes:
(1) The winter average for a residential customer is defined as the units of water billed from January through April of the previous calendar
year divided by four.
(2)Flow is reduced by 15% to reflect that not all water purchased is disposed of into the public sewer system.
(3)The fixed rate is based on the size of the water meter.
(4) The three-year winter average is defined as the sum of prior three years annual winter average divided by three. The annual winter average
is defined as the units of water billed from January through April divided by four.
(5) The average annual usage is defined as the units of water billed from January through December of previous year.
(6)The Sewer Rate is a per unit charge based on the non-residential account's strength factor as shown on the rates table as being either
Low, Medium, or High.
Source: Otay Water District
(Average Annual Usage(5) x .85(2) x Sewer Rate(6)) + Fixed Rate(3)
Residential
Non-Residential
Residential
Non-Residential
Sewer Variable and Fixed Rates - Last Ten Fiscal Years
Fixed Rates
Sewer Rates
90
Customer Name Customer Type Annual
Revenues
% of Water
Sales
1. City of Chula Vista Publicly Owned 5,182,399$ 4.3%
2. Eastlake III Community Commercial 1,484,357 1.2%
3. State of California Publicly Owned 1,477,618 1.2%
4. County of San Diego Publicly Owned 1,392,351 1.1%
5. HomeFed Corporation Commercial 1,066,728 0.9%
6. Eastlake Country Club Commercial 1,035,626 0.9%
7. Sweetwater School District Publicly Owned 934,296 0.8%
8. Chula Vista School District Publicly Owned 904,510 0.7%
9. California Sugar Refiners LLC Commercial 630,755 0.5%
10. Windingwalk Master Association Commercial 554,753 0.5%
Total Top Ten Customers 14,663,393$ 12.1%
Other Customers 106,820,098 87.9%
Total Water Sales 121,483,491$ 100.0%
Customer Name Customer Type Annual
Revenues
% of Water
Sales
1. City of Chula Vista Publicly Owned 3,247,032$ 4.4%
2. State of California Publicly Owned 1,017,064 1.4%
3. County of San Diego Publicly Owned 750,769 1.0%
4. Eastlake III Community Commercial 637,974 0.9%
5. Steele Canyon Golf Club LLC Commercial 598,046 0.8%
6. Chula Vista School District Publicly Owned 524,968 0.7%
7. Eastlake Country Club Commercial 442,514 0.6%
8. Sweetwater School District Publicly Owned 353,981 0.5%
9. Highlands Golf Company LLC Commercial 335,488 0.5%
10. Eastlake 1 HOA Commercial 306,520 0.4%
Total Top Ten Customers 8,214,356$ 11.2%
Other Customers 65,725,844 88.8%
Total Water Sales 73,940,200$ 100.0%
Source: Otay Water District
Ten Largest Customers - Current Year and Nine Years Ago
Fiscal Year 2025
Fiscal Year 2016
91
As a Share
Fiscal Population GO Revenue Lease Subscription-Based Per of Personal
Year Estimate Bond COPS Bonds Payable IT Payable Total Capita Income (7)
2025 242,000 -$ -$ 89,430,761$ 671,758$ 4,914,393$ 95,016,912$ 392.63$ 0.77%
2024 240,000 - - 94,256,620 690,539 5,294,431 (5)100,241,590 417.67 0.82%
2023 240,000 - - 99,779,295 707,727 85,348 (6)100,572,370 419.05 0.84%
2022 228,000 722,726 - 105,027,053 723,401 (4)- 106,473,180 466.99 0.91%
2021 226,000 1,444,080 - 110,029,807 - - 111,473,887 493.25 0.99%
2020 226,000 2,140,435 - 114,762,562 (2)- - 116,902,997 517.27 1.00%
2019 225,000 2,806,789 - 116,189,228 (3)- - 118,996,017 528.87 0.93%
2018 225,000 3,458,143 7,593,293 84,170,550 - - 95,221,986 423.21 0.73%
2017 224,000 4,079,498 8,192,548 87,134,618 - - 99,406,664 443.78 0.80%
2016 220,000 4,680,853 8,791,803 (1)90,218,686 - - 103,691,342 471.32 0.86%
(1)2007 COPS were refunded with the issuance of 2016 Water Revenue Refunding Bonds in May 2016.
(2)In December 2019, the District issued $3,120,000 in Wastewater Revenue Bonds to pay for certain capital improvements to the District's wastewater system.
(3)In November 2018, the District issued $32,435,000 in Water Revenue Bonds, Series 2018, of which a portion of the proceeds was used to advance refund
$6,900,000 of the 1996 Certificates of Participation.
(4)The District is a lessee for an antenna site lease that required annual fixed payments with a lease term of forty-eight years. Lease payable is measured at the
present value of payments expected to be made during the lease term.
(5)The District entered into a 30-month and a 15-year Subscription-Based IT Arrangements (SBITA) in FY2024 that required the District to make annual fixed
payments. SBITA payable is measured at the present value of payments expected to be made during the subscription terms.
(6)The District entered into two 36-month and one 14-month Subscription-Based IT Arrangements (SBITA) in FY2023 that required the District to make annual fixed
payments. SBITA payable is measured at the present value of payments expected to be made during the subscription terms.
(7)See the Demographics and Economic Statistics schedule on page 99 for personal income data. Per Capita Personal Income used in the calculation of "As a Share
of Personal Income" is updated annually for the last ten fiscal years based on the most recent LAEDC economic reports published. The Share of Personal Income is
therefore adjusted to reflect the economic data update.
Source: Otay Water District
Ratios of Outstanding Debt by Type - Last Ten Fiscal Years
$0
$100
$200
$300
$400
$500
$600
$700
2016 2017 2018 2019 2020 2021 2022 2023 2024 2025
Outstanding Debt Per Capita
92
Adjusted Net Revenues
Fiscal Adjusted Operating Available for Debt Service Requirements (3)Coverage
Year Revenues (1)Expenses (2)Debt Service Principal Interest Total Factor (4)
2025 158,205,609$ 123,056,778$ 35,148,831$ 4,445,000$ 4,192,516$ 8,637,516$ 407%(5)
2024 129,703,143 137,537,348 (7,834,206) 5,070,000 4,417,886 9,487,886 -83%
(6)
2023 119,198,005 98,660,691 20,537,314 4,720,000 4,667,830 9,387,830 219%
2022 119,990,007 86,853,307 33,136,700 4,480,000 4,892,778 9,372,778 354%
2021 118,995,389 85,872,652 33,122,737 4,275,000 5,108,566 9,383,566 353%
2020 105,820,913 88,223,522 17,597,391 4,075,000 5,289,640 9,364,640 188%
2019 103,126,288 85,243,519 17,882,769 3,405,000 5,037,638 8,442,638 212%
2018 110,274,227 86,437,355 23,836,872 3,215,000 4,334,368 7,549,368 316%
2017 94,551,308 79,062,983 15,488,325 3,335,000 4,420,433 7,755,433 200%
2016 85,417,850 72,117,631 13,300,219 3,120,000 4,640,947 7,760,947 171%
(1)Adjusted revenues exclude sewer revenues and taxes collected for Improvement District 27 and are inclusive of capacity fees.
(2)Adjusted operating expenses exclude sewer expenses and depreciation expense.
(3)Pledge debts are Revenue Bonds.
(4)The District's bond covenants require a minimum coverage factor of 125%.
(5)For the fiscal year ending June 30, 2025, the decrease of $14.5 million in the adjusted operating expenses include a $15 million
reduction in the accrual for the estimated litigation-related expense recorded in fiscal year ending June 30, 2024 that is noted in footnote 6.
(6)The estimated potential liability for attorneys’ fees and damages from the Coziahr v. Otay Water District litigation of $27 million
(“Estimated Potential Liability”) have been accrued in Fiscal Year 2023-24. The Estimated Potential Liability is anticipated to be
paid, if and when due, from the District’s reserves and is not expected to impact the District’s ability in future years to comply
with its covenant to fix rates and charges to produce Taxes and Net Revenues pledged to the water revenue bonds and/or
installment payments at least equal to 125% of Debt Service. See Note 10 on pages 58-59 for further explanation.
Source : Otay Water District
Pledged Revenue Coverage (Water) - Last Ten Fiscal Years
-200%
-100%
0%
100%
200%
300%
400%
2016 2017 2018 2019 2020 2021 2022 2023 2024 2025
Coverage Factor, in Percentage (%)
Actual Ratio Minimum ratio
93
Adjusted Net Revenues
Fiscal Sewer Operating Available for Debt Service Requirements (4)Coverage
Year Revenues Expenses (3)Debt Service Principal Interest Total Factor (5)
2025 4,044,385$ 2,590,948$ 1,453,437$ 75,000$ 84,564$ 159,564$ 911%
2024 3,767,973 2,415,560 1,352,413 75,000 86,585 161,585 837%
2023 3,516,361 2,562,144 954,217 70,000 88,229 158,229 603%
2022 3,192,268 1,861,910 1,330,358 65,000 89,658 154,658 860%
2021 3,075,276 2,677,205 398,071 - 86,500 86,500 460%
2020 (2)3,061,829 2,439,432 622,397 - 50,154 50,154 1241%
(1)No wastewater revenue bonds were issued between FY 2016 and FY 2019.
(2)In December 2019, the District issued $3,120,000 in Wastewater Revenue Bonds to pay for certain capital improvements
to the District's wastewater system.
(3)Adjusted operating expenses exclude depreciation expense.
(4)Pledge debts are Revenue Bonds.
(5)The District's bond covenants require a minimum coverage factor of 150%.
Source: Otay Water District
Pledged Revenue Coverage (Wastewater) - Last Ten Fiscal Years (1)
0%
200%
400%
600%
800%
1000%
1200%
1400%
2020 2021 2022 2023 2024 2025
Coverage Factor, in Percentage (%)
Actual Ratio Minimum ratio
94
Net Bonded
Net Debt to Net Bonded
Fiscal Population Assessed Bonded Assessed Debt Per
Year Estimate Valuation Debt Valuation Capita
2025 242,000 45,946,621,442$ -$ 0.000%-
2024 240,000 43,072,336,140 -0.000%-
2023 240,000 40,067,736,869 -(1)0.000%-
2022 228,000 36,225,223,831 722,726 0.002%3.17
2021 226,000 34,567,775,896 1,444,080 0.004%6.39
2020 226,000 32,639,341,026 2,140,435 0.007%9.47
2019 225,000 30,767,749,324 2,806,789 0.009%12.47
2018 225,000 29,387,363,297 3,458,143 0.012%15.37
2017 224,000 27,598,986,676 4,079,498 0.015%18.21
2016 220,000 26,057,698,553 4,680,853 0.018%21.28
(1)At June 30, 2023, the General Obligation Bonds were paid off.
Source: Otay Water District
Ratios of General Bonded Debt Outstanding - Last Ten Fiscal Years
0.00%
0.01%
0.02%
0.03%
0.04%
2016 2017 2018 2019 2020 2021 2022 2023 2024 2025
Bonded Debt Ratios, in Percentage (%)
95
Computation of Direct and Overlapping Bonded Debt
June 30, 2025
2024-25 Assessed Valuation: $45,946,621,442
Total Debt District’s Share of
OVERLAPPING TAX AND ASSESSMENT DEBT: 6/30/25 % Applicable (1) Debt 6/30/25
Metropolitan Water District $ 17,155,000 1.125% $ 192,994
Grossmont-Cuyamaca Community College District 331,030,377 14.599 48,327,125
Southwestern Community College District 719,185,157 43.102 309,983,186
Grossmont Union High School District 623,428,398 15.008 93,564,134
Sweetwater Union High School District 624,127,496 51.080 318,804,325
Chula Vista City School District and School Facilities
Improvement District 252,059,000 62.366 & 31.96 135,648,863
San Ysidro School District 134,592,718 60.903 81,971,003
Other School Districts 8,261,289,351 Various 62,539,759
Grossmont Healthcare District 198,875,853 13.285 26,420,657
City of Chula Vista Community Facilities District 92,510,000 100.92,510,000
Sweetwater Union High School District Community Facilities
Districts 23,839,845 17.911 - 100. 22,415,753
City 1915 Act Bonds 4,020,000 100.4,020,000
California Statewide Communities Development Authority
Assessment Districts 11,090,161 100.11,090,161
California Municipal Finance Authority Community Facilities
Districts 49,050,000 100.49,050,000
TOTAL OVERLAPPING TAX AND ASSESSMENT DEBT $ 1,256,537,960
DIRECT AND OVERLAPPING GENERAL FUND DEBT:
San Diego County General Fund Obligations $ 351,065,000 6.198% $ 21,759,009
San Diego County Pension Obligation Bonds 140,370,000 6.198 8,700,133
San Diego Superintendent of Schools Certificates of Participation 5,125,000 6.198 317,648
Otay Water District 95,016,912 100. 95,016,912
Chula Vista City School District Certificates of Participation 154,730,000 62.366 96,498,912
San Ysidro School District Certificates of Participation 30,820,000 60.903 18,770,305
Other School District Certificates of Participation 42,566,000 Various 7,345,516
City of Chula Vista Certificates of Participation and Pension
Obligations 405,320,000 69.798 282,905,254
City of San Diego General Fund Obligations 746,017,974 1.143 8,526,985
San Miguel Consolidated Fire Protection District Pension
Obligation Bonds 25,186,000 50.084 12,614,156
TOTAL DIRECT AND OVERLAPPING GENERAL FUND DEBT $ 552,454,830
Less: Otay Water District Revenue Bonds, Leases &
Subscription-based IT Payables (100% self-supporting) 95,016,912
TOTAL NET DIRECT AND OVERLAPPING GENERAL FUND DEBT $ 457,437,918
Continued
96
Computation of Direct and Overlapping Bonded Debt
Total Debt District’s Share of
6/30/25 % Applicable (1) Debt 6/30/25
OVERLAPPING TAX INCREMENT DEBT (Successor Agency): $ 14,940,000 18.658% $2,787,505
TOTAL GROSS DIRECT DEBT $95,016,912
TOTAL NET DIRECT DEBT $0 (2)
TOTAL OVERLAPPING DEBT $1,716,763,383
COMBINED TOTAL DEBT $1,716,763,383 (3)
Ratios to 2024-25 Assessed Valuation:
Direct Debt ($0) ........................................................................................... 0.00%
Total Direct and Overlapping Tax and Assessment Debt .................. 2.73%
Combined Total Debt ......................................................................................... 3.74%
Ratios to Redevelopment Successor Agency Incremental Valuation ($530,013,729):
Total Overlapping Tax Increment Debt ...................................................... 0.53%
(1)The percentage of overlapping debt applicable to the district is estimated using taxable assessed property value. Applicable
percentages were estimated by determining the portion of the overlapping district's assessed value that is within the boundaries
of the water district divided by the overlapping district's total taxable assessed value.
(2)Excludes $95,016,912 revenue bonds, leases and subscription-based IT payables supported by water revenues and backed by a
rate covenant.
(3)Excludes tax and revenue anticipation notes, enterprise revenue, mortgage revenue and non-bonded capital lease obligations.
Qualified Zone Academy Bonds are included based on principal due at maturity.
Source: California Municipal Statistics, Inc., and Otay Water District
97
2016
% of Total % of Total
County County
Employer Employees Rank Employment Employees Rank Employment
Federal Government(1),(5)46,300 1 2.91%
University of California San Diego(2)42,479 2 2.67%29,287 1 1.96%
State of California(1),(4),(5)23,400 3 1.47%
County of San Diego(1),(5)21,300 4 1.34%
Sharp HealthCare(3)20,139 5 1.27%16,896 2 1.13%
San Diego Unified School District(3),(5)17,226 6 1.08%
Scripps Health(3)14,732 7 0.93%14,644 3 0.98%
City of San Diego(3),(5)13,352 8 0.84%
Qualcomm Inc.(3)10,124 9 0.64%13,500 4 0.91%
Kaiser Permanente(3)7,687 10 0.48%7,535 5 0.51%
UC San Diego Health System 7,229 6 0.48%
San Diego Community College District 5,902 7 0.40%
YMCA of San Diego County 5,487 8 0.37%
Rady Children's Hospital-San Diego 5,122 9 0.34%
General Atomics (and affiliated companies)5,088 10 0.34%
Total 216,739 13.63%110,690 7.42%
Footnotes:
(1) Source: California Employment Development Department Labor Market Information
(2) Source: University of California
(3) Source: City of San Diego
(4) Excludes education
(5) In Fiscal Year 2016, the United States Navy, Federal Government, State of California, San Diego Unified School District,
City of San Diego and County of San Diego declined to participate in the survey organized by the San Diego Business
Journal, the source previously used for rankings.
San Diego County Principal Employers
Current Year and Nine Years Ago
2025
98
Personal Per Capita
Fiscal Income Personal Unemployment
Year Population (in thousands)Income Rate
2025 3,306,800 242,889,000$ (1)73,451 4.45%
2024 3,291,100 242,163,000 73,581 4.31%
2023 3,269,800 237,505,000 72,636 3.46%
2022 3,287,300 167,801,000 51,045 4.46%
2021 3,315,400 164,786,000 49,703 8.28%
2020 3,343,400 173,279,000 51,827 6.06%
2019 3,351,800 191,558,000 57,151 3.31%
2018 3,337,500 194,633,000 58,317 3.57%
2017 3,316,200 184,260,000 55,564 4.37%
2016 3,288,600 179,717,000 54,648 4.86%
(1)Estimated Figure
Source: SANDAG; California Department of Finance; California Employment Development Department.
San Diego County Demographic and Economic Statistics
Last Ten Fiscal Years
0%
1%
2%
3%
4%
5%
6%
7%
8%
9%
2016 2017 2018 2019 2020 2021 2022 2023 2024 2025
Unemployment Rate, in Percentage (%)
99
Department 2025 2024 2023 2022 2021 2020 2019 2018 2017 2016
General Manager 4 4 4 4 5 5 5 6 6 5
Finance 33 31 31 31 31 31 31 29 31 32
Operations 57 57 56 54 54 53 52 52 51 51
Engineering 29 29 29 28 26 26 26 24 24 24
Administrative Services 23 23 23 23 23 23 23 23 23 26
Total 146 144 143 140 139 138 137 134 135 138
Source : Otay Water District
Number of Employees by Function - Last Ten Fiscal Years
0
25
50
75
100
125
150
175
2016 2017 2018 2019 2020 2021 2022 2023 2024 2025
Total Employees
100
Meter Size 2025 2024 2023 2022 2021 2020 2019 2018 2017 2016
3/4" & 5/8" 44,727 44,682 44,616 44,583 44,532 44,520 44,490 44,473 44,423 44,413
1"4,826 4,719 4,562 4,389 4,284 4,080 3,680 3,235 2,800 2,756
1 ½"1,452 1,442 1,417 1,409 1,378 1,365 1,362 1,343 1,349 1,342
2"1,357 1,353 1,344 1,344 1,336 1,344 1,334 1,326 1,301 1,299
3"141 129 123 120 112 105 102 87 87 82
4"283 296 289 280 283 281 279 272 232 210
6"21 26 26 23 23 25 25 24 22 22
Others 9 9 9 9 9 9 9 9 9 9
Total 52,816 52,656 52,386 52,157 51,957 51,729 51,281 50,769 50,223 50,133
% Change 0.3% 0.5% 0.4% 0.4% 0.4% 0.9% 1.0% 1.1% 0.2% 0.6%
Increase 160 270 229 200 228 448 512 546 90 283
Source: Otay Water District
Active Meters by Size - Last Ten Fiscal Years
48,500
49,000
49,500
50,000
50,500
51,000
51,500
52,000
52,500
53,000
2016 2017 2018 2019 2020 2021 2022 2023 2024 2025
Active Meters
101
2025 2024 2023 2022 2021 2020 2019 2018 2017 2016
Water System
Service Area (Square Miles) 125.4 125.3 125.3 125.3 125.5 125.5 125.5 125.5 125.5 125.5
Miles of Potable Water Main 755.0 737.0 731.0 727.0 726.0 723.0 723.0 727.0 727.0 727.0
Number of Operational
Storage Reservoirs in Service 40 40 40 40 40 40 40 40 40 40
Water Storage Capacity
(in Acre-Feet) 672.0 672.0 672.0 672.0 672.0 672.0 672.0 672.0 672.0 672.0
Total Potable Water Connections
(No. of Meters in Service)52,007 51,853 51,604 51,389 51,204 50,994 50,555 50,045 49,502 49,425
Number of Pump Stations 21 21 21 21 21 21 21 21 21 21
Number of Potable Water
Valves 22,626 22,519 22,455 22,178 21,218 20,981 20,746 20,746 20,746 20,746
Sewer System
Miles of Sewer Lines 84.0 88.0 88.0 88.0 88.0 84.0 84.0 88.0 88.0 88.0
Number of Treatment Plants 1 1 1 1 1 1 1 1 1 1
Treatment Plant Capacity
(Million Gallons per Day)1.3 1.3 1.3 1.3 1.3 1.3 1.3 1.3 1.3 1.3
Total Flows for Fiscal
Year (in Million Gallons)339 439 406 385 394 399 388 381 393 336
Total Sewer Connections
(No. of Meters in Service)4,757 4,750 4,748 4,738 4,736 4,737 4,737 4,714 4,683 4,677
Recycled System
Miles of Recycled Water
Mains 107.0 102.0 102.0 101.0 104.0 104.0 104.0 104.0 104.0 104.0
Number of Pumping Facilities 3 3 3 3 3 3 3 3 3 3
Number of Operational
Storage Reservoirs in Service 4 4 4 4 4 4 4 4 4 4
Number of Acre-Feet Storage 133.2 133.2 133.2 133.2 133.2 133.2 133.2 134.2 134.2 134.2
Total Recycled Water Connections
(No. of Meters in Service)809 798 782 768 753 735 726 724 721 708
Number of Recycled
Water Valves 1,533 1,527 1,526 1,468 1,522 1,506 1,497 1,497 1,497 1,497
(1) For Fiscal Year ending June 30, 2019, the decreases are a result of sewer gravity mains now maintained by the County of San Diego.
Source : Otay Water District
Operating and Capital Indicators - Last Ten Fiscal Years
(1)
(1)
102
Otay Water District
2554 Sweetwater Springs Blvd.
Spring Valley, California 91978-2004
otaywater.gov