Loading...
HomeMy WebLinkAbout11-06-24 Board Packet1 OTAY WATER DISTRICT AND OTAY WATER DISTRICT FINANCING AUTHORITY BOARD OF DIRECTORS MEETING 2554 SWEETWATER SPRINGS BOULEVARD SPRING VALLEY, CALIFORNIA WEDNESDAY NOVEMBER 6, 2024 3:30 P.M. AGENDA 1. ROLL CALL 2. PLEDGE OF ALLEGIANCE 3. APPROVAL OF AGENDA 4. APPROVAL OF THE MINUTES OF THE REGULAR BOARD MEETING OF SEP- TEMBER 4, 2024, AND OCTOBER 2, 2024 5. PRESENTATION OF THE SPECIAL DISTRICT LEADERSHIP FOUNDATION TRANSPARENCY CERTIFICATE OF EXCELLENCE TO OTAY WATER DIS- TRICT (CHRIS PALMER, CALIFORNIA SPECIAL DISTRICT ASSOCIATION, SENIOR PUBLIC AFFAIRS FIELD COORDINATOR) 6. WATER CONSERVATION GARDEN UPDATE (LAUREN MAGNUSON, EXECU- TIVE DIRECTOR) 7. 2024 END-OF-YEAR LEGISLATIVE UPDATE (TENILLE OTERO AND BROWN- STEIN, HYATT, FARBER AND SCHRECK) 8. PUBLIC PARTICIPATION – OPPORTUNITY FOR MEMBERS OF THE PUBLIC TO SPEAK TO THE BOARD ON ANY SUBJECT MATTER WITHIN THE BOARD’S JURISDICTION INCLUDING AN ITEM ON TODAY’S AGENDA Additionally, if you wish to have your comment read to the Board during the “Public Participation” portion of the meeting, please email your comment to BoardSecre- tary@otaywater.gov at least thirty minutes prior to the start of the meeting, which will be read aloud during the “Public Participation” portion of the meeting. Please provide your Name and the City in which you reside, with your comment. Your 2 comment must not take more than three minutes to read. The Board is not per- mitted to respond to written public comment during this time. The District’s meeting is live streamed. Information on how to watch and listen to the District’s meeting can be found at this link: https://otaywater.gov/board-of- directors/agenda-and-minutes/board-agenda/ CONSENT CALENDAR 9. ITEMS TO BE ACTED UPON WITHOUT DISCUSSION, UNLESS A REQUEST IS MADE BY A MEMBER OF THE BOARD OR THE PUBLIC TO DISCUSS A PARTICULAR ITEM: a) AUTHORIZE THE GENERAL MANAGER TO ISSUE A PURCHASE ORDER TO HAWTHORNE CAT IN THE AMOUNT OF $149,000.00 FOR THE PUR- CHASE OF ONE REPLACEMENT STATIONARY EMERGENCY GENERA- TOR FOR THE ADMINISTRATIVE BUILDING, DECLARE EXISTING GENER- ATOR AS SURPLUS, INCREASE CIP P2688 FROM $76,000.00 TO $239,000.00 FOR FISCAL YEAR 2025 AND TO INCREASE THE OVERALL SIX-YEAR CIP FROM $833,000.00 TO $996,000.00 (CHARLES MEDEROS) b) AWARD A PROFESSIONAL SERVICES CONTRACT FOR AS-NEEDED PLAN CHECKING AND RECYCLED WATER INSPECTION SERVICES TO WEST YOST & ASSOCIATES, INC. (WEST YOST) AND AUTHORIZE THE GENERAL MANAGER TO EXECUTE AN AGREEMENT WITH WEST YOST IN AN AMOUNT NOT-TO-EXCEED $850,000 FOR FISCAL YEARS 2025- 2027 (ENDING JUNE 30, 2027) (BRANDON DIPIETRO) c) APPROVE TO INCREASE THE CIP P2631 BUDGET BY $174,500 (FROM $1,450,000 TO $1,624,500); AND AWARD A CONSTRUCTION CONTRACT TO UNIFIED FIELD SERVICES CORPORATION (UFSC) AND AUTHORIZE THE GENERAL MANAGER TO EXECUTE AN AGREEMENT WITH UFSC FOR THE 1004-2 & 1485-2 RESERVOIR INTERIOR/EXTERIOR COATING & UPGRADES PROJECT IN AN AMOUNT NOT-TO-EXCEED $1,304,694 (P2567 AND P2631) (LITO SANTOS) d) AWARD TWO (2) PROFESSIONAL SERVICE CONTRACTS FOR AS- NEEDED ENGINEERING DESIGN SERVICES AND AUTHORIZE THE GEN- ERAL MANAGER TO EXECUTE TWO AGREEMENTS WITH NV5, INC. (NV5) AND WOOD RODGERS, INC. (WOOD RODGERS), EACH IN AN AMOUNT NOT-TO-EXCEED $800,000. THE TOTAL AMOUNT OF THE TWO CON- TRACTS WILL NOT EXCEED $800,000 DURING FISCAL YEARS 2025-2027 (ENDING JUNE 30, 2027) (KEVIN CAMERON) 3 ACTION ITEMS 10. BOARD a) APPROVE THE AUDITED FINANCIAL STATEMENTS, INCLUDING THE IN- DEPENDENT AUDITORS’ UNQUALIFIED OPINION, FOR THE FISCAL YEAR ENDING JUNE 30, 2024 (MARISSA DYCHITAN) b) DISCUSS THE 2024 AND 2025 BOARD MEETING CALENDAR (TITA RA- MOS-KROGMAN) INFORMATIONAL ITEMS 11. SOCIAL MEDIA, MOBILE APPLICATION, AND WEBSITE ANALYTICS UPDATE (EILEEN SALMERON/TENILLE OTERO) REPORTS 12. GENERAL MANAGER’S REPORT 13. SAN DIEGO COUNTY WATER AUTHORITY UPDATE 14. DIRECTORS' REPORTS/REQUESTS 15. PRESIDENT’S REPORT/REQUESTS RECESS TO CLOSED SESSION 16. CLOSED SESSION a) CONFERENCE WITH REAL PROPERTY NEGOTIATORS Pursuant to Cali- fornia Government Code §54956.8 Property: SALT CREEK GOLF COURSE 525 HUNTE PARKWAY CHULA VISTA, CA 91914 Agency Negotiator: General Counsel Under Negotiation: Disposition of Property RETURN TO OPEN SESSION 17. REPORT ON ANY ACTIONS TAKEN IN CLOSED SESSION. THE BOARD MAY ALSO TAKE ACTION ON ANY ITEMS POSTED IN CLOSED SESSION. 4 OTAY WATER DISTRICT FINANCING AUTHORITY 18. NO MATTERS TO DISCUSS 19. ADJOURNMENT All items appearing on this agenda, whether or not expressly listed for action, may be deliberated and may be subject to action by the Board. The Agenda, and any attachments containing written information, are available at the District’s website at www.otaywater.gov. Written changes to any items to be considered at the open meeting, or to any attachments, will be posted on the District’s website. Copies of the Agenda and all attachments are also available by contacting the District Secretary at (619) 670-2253. If you have any disability which would require accommodation in order to enable you to participate in this meeting, please call the District Secretary at (619) 670-2253 at least 24 hours prior to the meeting. Certification of Posting I certify that on November 1, 2024, I posted a copy of the foregoing agenda near the regular meeting place of the Board of Directors of Otay Water District, said time being at least 72 hours in advance of the regular meeting of the Board of Directors (Government Code Section §54954.2). Executed at Spring Valley, California on November 1, 2024. /s/ Tita Ramos-Krogman, District Secretary 1 MINUTES OF THE BOARD OF DIRECTORS MEETINGS OF THE OTAY WATER DISTRICT AND OTAY WATER DISTRICT FINANCING AUTHORITY September 4, 2024 1.The meeting was called to order by President Lopez at 3:32 p.m. 2.ROLL CALL Directors Present: Croucher, Keyes, Lopez and Robak Directors Absent: None Staff Present: General Manager Jose Martinez, General Counsel Dan Shinoff, Chief of Engineering Michael Long, Chief Financial Officer Joe Beachem, Chief of Administration Adolfo Segura, Chief of Operations Andrew Jackson, Asst. Chief of Finance Kevin Koeppen, District Secretary Tita Ramos-Krogman and others per attached list. 3.PLEDGE OF ALLEGIANCE 4.APPROVAL OF AGENDA A motion was made by Director Croucher, seconded by Director Keyes, and carriedwith the following vote: Ayes: Directors Croucher, Keyes, Lopez and Robak Noes: None Abstain: None Absent: None to approve the agenda. 5.PRESENTATION OF PLAQUE TO THE OTAY WATER DISTICT Deputy Chief Chris Monroe of Training and Professional Standards from the ChulaVista Fire Department, and Fire Chief Mitchell of Southern California Fire Management Zone and also the Fire Management Officer for U.S. Fish and Wildlife Servicepresented a plaque to the Otay Water District (OWD) on behalf of the city of ChulaVista and the San Diego County Fire Chiefs Association to express their gratitude andappreciation for OWD’s collaborative efforts to provide a training facility that trainedapproximately 1,000 fire fighters, police officers, and emergency managers. They were also able to provide an S219 Class, which is live fire training on wild land that was onOWD’s property. Chief Mitchell and Deputy Chief Monroe also thanked OWD’sEngineering Manager Beth Gentry, Environmental Compliance Specialist Juliana AGENDA ITEM 4 2 Luengas, and Purchasing Manager Kent Payne as they assisted in setting up the collaboration with all agencies. 6. PUBLIC PARTICIPATION – OPPORTUNITY FOR MEMBERS OF THE PUBLIC TO SPEAK TO THE BOARD ON ANY SUBJECT MATTER WITHIN THE BOARD'S JURISDICTION BUT NOT AN ITEM ON TODAY'S AGENDA No one wished to be heard. ACTION ITEMS 7. BOARD a) INTERVIEW APPLICANTS AND APPOINT A REPRESENTATIVE TO THE DIVISION 1 SEAT ON THE DISTRICT’S BOARD OF DIRECTORS FOR THE REMAINING TERM OF FORMER DIRECTOR TIM SMITH i. ADOPT RESOLUTION NO. 4450 OF THE BOARD OF DIRECTORS OF OTAY WATER DISTRICT APPOINTING ____________________ TO THE BOARD OF DIRECTORS, DIVISION 1, TO FILL THE VACANCY LEFT BY DIRECTOR TIM SMITH’S RESIGNATION General Counsel Dan Shinoff stated the protocols for the interview process and indicated that there were two applicants in which one will be interviewed remotely and the other one in person. The applicants agreed that when one of them is being interviewed, the other will be absent from the boardroom. At the conclusion of the interviews in open session, the board will deliberate (in the open session) and chose a new board member. Director Robak stated that there were three applicants who were invited to attend the board meeting to be interviewed for the Division 1 Vacancy Seat, but one applicant was not responsive. General Counsel Shinoff added that General Manager Jose Martinez and District Secretary Tita Ramos-Krogman made several phone calls and sent several emails and text messages to invite the individual for an interview. There were also several follow-up phone calls and emails; however, there was no response from the individual. It was noted that the last attempt to reach the individual was on September 3 at 5:10 p.m., and there was no response. The first individual to be interviewed was Mr. Francisco X. Rivera, who remotely joined the meeting. In response to a question from Director Robak, Mr. Rivera stated that he had a pre-planned vacation, and therefore remotely joined the meeting to be interviewed. Mr. Rivera answered additional questions from the full board. Following the interview, Mr. Rivera left the meeting. The board recessed to a 5-minute break at 4:17 p.m. and reconvened the meeting at 4:22 p.m. President Lopez requested that General Counsel Dan Shinoff state the interview protocols again for the second interviewee, Ms. Ashleigh Padilla. 3 Ms. Padilla attended the board meeting in person to be interviewed. Ms. Padilla responded to questions and comments from the board. A motion was made by Director Keyes to appoint Mr. Francisco X. Rivera to the Division 1 Seat on the Otay Water District. Director Robak seconded the motion. The board commented on both candidates’ impressive qualifications and thanked them for their dedication to serving the public and involvement with the community. Each board member provided comments and stated that Mr. Rivera has the background and engineering experience to fill the Division 1 Vacancy Seat. A motion was made by Director Keyes, seconded by Director Robak and carried with the following vote: Ayes: Directors Croucher, Keyes, Lopez and Robak Noes: None Abstain: None Absent: None to Adopt Resolution No. 4450 of the Board of Directors of Otay Water District appointing Mr. Francisco X. Rivera to the Board of Directors, Division 1, to fill the vacancy left by Director Tim Smith’s resignation. The board recessed for a 5-minute break at 4:46 p.m. and reconvened the meeting at 4:51 p.m. At the request of President Lopez, Mr. Rivera virtually rejoined the meeting to receive the results of the interview. President Lopez announced that he was selected to fill the Division 1 vacancy. The board provided their input and comments and congratulated Mr. Rivera. He thanked the board for being selected to fill the vacancy and the opportunity to serve the district and its customers. General Counsel Dan Shinoff stated that the district will organize a special board meeting to swear in Mr. Francisco X. Rivera to have him officially seated on the board. b) DISCUSS THE 2024 BOARD MEETING CALENDAR General Manager Jose Martinez stated that the District Secretary will coordinate a special board meeting to perform the Oath of Office and seating of Mr. Rivera. Director Croucher indicated that the ACWA Conference and the Colorado River Users Water Association Conference (CRUWA) will be held the same week in December. He suggested that board members consider which conference they would like to attend and have President Lopez decide which board members will attend the ACWA Conference and CRUWA Conference. In addition, Director Croucher shared that he may not be able to attend the October 2, 2024, board meeting due to a family emergency issue. 4 In response to a question from President Lopez, General Manager Martinez stated that a special board meeting may be scheduled on December 6 to swear in new board members, depending on the results of the November 2024 election. There were no changes to the board calendar. RECESS TO CLOSED SESSION 8. CLOSED SESSION The board recessed to closed session at 5:00 p.m. to discuss the following matter: a) HECTOR TORRES vs. OTAY WATER DISTRICT LAWSUIT – CASE NO. 24CU006921C b) CONFERENCE WITH REAL PROPERTY NEGOTIATORS Pursuant to California Government Code §54956.8 Property: SALT CREEK GOLF COURSE 525 HUNTE PARKWAY CHULA VISTA, CA 91914 Agency Negotiator: General Counsel Under Negotiation: Disposition of Property c) CONFERENCE WITH LEGAL COUNSEL – EXISTING LITIGATION [GOVERNMENT CODE §54956.9] OTAY WATER DISTRICT vs. CITY OF SAN DIEGO; CASE NO. 37-2017-00019348-CU-WM-CTL d) CONFERENCE WITH LEGAL COUNSEL – EXISTING LITIGATION [GOVERNMENT CODE §54956.9] MARK COZIAHR, ET AL. vs. OTAY WATER DISTRICT, CASE NO. 37-2015- 000-CU-MC-CTL RETURN FROM CLOSED SESSION 9. REPORT ON ANY ACTIONS TAKEN IN CLOSED SESSION. THE BOARD MAY ALSO TAKE ACTION ON ANY ITEMS POSTED IN CLOSED SESSION. The board reconvened from closed session at 6:06 p.m. and General Counsel Dan Shinoff reported that there was no reportable action taken in Closed Session. CONSENT CALENDAR 5 10. ITEMS TO BE ACTED UPON WITHOUT DISCUSSION, UNLESS A REQUEST IS MADE BY A MEMBER OF THE BOARD OR THE PUBLIC TO DISUSS A PARTICULAR ITEM: A motion was made by Director Croucher, seconded by Director Keyes and carried with the following vote: Ayes: Directors Croucher, Keyes, Lopez and Robak Noes: None Abstain: None Absent: None to approve the following consent calendar items: a) AUTHORIZE AN AMENDMENT TO THE CURRENT CONSULTING SERVICES AGREEMENT WITH BROWNSTEIN HYATT FARBER SCHRECK, LLP FOR LEGISLATIVE ADVOCACY TO EXTEND THE TERM THROUGH DECEMBER 31, 2025, AND INCREASE THE TOTAL COMPENSATION BY $75,000 TO AN AMOUNT NOT-TO-EXCEED $350,000 b) ADOPT RESOLUTION NO. 4446 FOR A GRANT FUNDING AGREEMENT WITH THE UNITED STATES BUREAU OF RECLAMATION’S WATERSMART: WATER AND ENERGY EFFICIENCY GRANT (WEEG) FUNDING OPPORTUNITY FOR FISCAL YEARS 2024 AND 2025 c) APPROVE TO INCREASE THE BUDGET FOR CIP P2572 BY $197,650 AND AUTHORIZE THE GENERAL MANAGER TO AWARD A CONSULTING SERVICES CONTRACT TO KOA HILLS, INC. FOR THE NEW ERP UPGRADE PROJECT d) AUTHORIZE AN ADDENDUM TO THE CONSULTING SERVICES AGREEMENT BY AND BETWEEN THE OTAY WATER DISTRICT AND SAGEVIEW ADVISORY GROUP, LLC TO AMEND THE SCOPE OF SERVICES AND TOTAL COMPENSATION IN AN AMOUNT NOT-TO-EXCEED $161,000 e) ADOPT ORDINANCE NO. 594 AMENDING APPENDIX A OF THE DISTRICT’S CODE OF ORDINANCES IMPLEMENTING A 12.7% (REVISED FROM 12.8%) POTABLE WATER INCREASE, EFFECTIVE JANUARY 1, 2025, AND DIRECT STAFF TO FINALIZE AND MAIL RATE INCREASE NOTICES f) ADOPT THE ASSOCIATION OF CALIFORNIA WATER AGENCIES JOINT POWERS INSURANCE AUTHORITY’S (ACWA JPIA) COMMITMENT TO EXCELLENCE (C2E) PROGRAM g) AWARD A PROFESSIONAL ENVIRONMENTAL SERVICES AGREEMENT (AGREEMENT) TO HELIX ENVIRONMENTAL PLANNING, INC. (HELIX) AND AUTHORIZE THE GENERAL MANAGER TO EXECUTE AN AGREEMENT WITH HELIX FOR THE SAN MIGUEL HABITAT MANAGEMENT AREA AND CIP- 6 ASSOCIATED MITIGATION PROJECTS IN AN AMOUNT NOT-TO-EXCEED $536,976 DURING FISCAL YEARS 2025, 2026, AND 2027 h) APPROVE TO INCREASE THE BUDGET FOR CIP P2228 BY $2,388,325 AND P2563 BY $2,051,770 AND AUTHORIZE THE GENERAL MANAGER TO AWARD CONSTRUCTION CONTRACT(S) TO PACIFIC HYDROTECH FOR THE 870-2 RESERVOIR 3.4 MG AND 870-1 RESERVOIR IMPROVEMENT PROJECTS IN AN AMOUNT NOT-TO-EXCEED $20,896,264 INFORMATIONAL ITEM 11. DISTRICT METER CHANGEOUT PRJECT AND ADVANCED METERING INFRASTRUCTURE UPDATE Customer Service Manager Andrea Carey provided a PowerPoint Presentation to the board. Director Croucher left the dias at 6:11 p.m. and returned to the dias at 6:14 p.m. Ms. Carey stated that staff plans to apply for future grants as they become available. President Lopez inquired about the process of receiving grants. Ms. Carey stated that there are bi-annually reporting periods for the grant where the district submits an expenditure report and receives a 50% reimbursement as long as the completed work was in relation to the project. She noted that the Finance Department receives the reimbursement through a portal. Director Croucher shared that at the August 2024 Finance Committee meeting, there was a discussion on promoting rebate offers to customers, the capability of controlling meters (shut off) where necessary, and collaborating with insurance companies who require residents to have leak detection equipment installed in their homes to prevent water waste. In response to a question from Director Robak, Ms. Carey stated that Olivenhain Municipal Water District, city of Oceanside, and Rancho Santa Fe Irrigation District has deployed fixed network and cellular systems. She responded to additional comments and questions from the board. REPORTS 12. GENERAL MANAGER REPORT General Manager Martinez stated that he had no specific highlights in his GM Report to discuss. There were no questions from the board. 13. SAN DIEGO COUNTY WATER AUTHORITY UPDATE Director Croucher stated that CWA staff presented the progress of the MWD Climate Adaption Master Plan for water and stated that the one-year report was completed and 7 an evaluation criteria was established which is now running sample scoring of projects and programs. He also shared that CWA approved a Member Agency Funding Program that added $100,000 to the regional water loss program. There was an update to SDCWA’s Master Plan, specifically on efficiency projects optimizing the system such as changing pipelines from raw to treated. He also stated that CWA identified one project that will save money, but not during relining and during shutdowns. Total savings are anticipated to be $30-$40 million over the next 10 years. Director Croucher also shared that the general counsel’s contract was extended for another 4 years with a 5% COLA, 2% Merit, and added vacation time. 14. DIRECTORS' REPORTS/REQUESTS Written reports from Directors Croucher, Keyes, and Robak were submitted to District Secretary Ramos-Krogman, which will be attached to the minutes for today’s meeting. 15. PRESIDENT’S REPORT President Lopez stated that former director, Tim Smith, will continue to represent the Otay Water District on the San Diego County Water Authority for at least another 2 months. President Lopez thanked Director Croucher for taking Mr. Smith’s place on the Finance and Administrative Committee. A written report from President Lopez was submitted to District Secretary Ramos-Krogman and will be attached to the minutes for today’s meeting. OTAY WATER DISTRICT FINANCING AUTHORITY 16. NO MATTERS TO DISCUSS There were no items scheduled for discussion for the Otay Water District Financing Authority board. 17. ADJOURNMENT With no further business to come before the Board, President Lopez adjourned the meeting at 6:38 p.m. President ATTEST: District Secretary OTAY WATER DISTRICT BOARD OF DIRECTORS PER DIEM AND MILEAGE CLAIM FORM Pay To: Jose Lopez Period Covered: Employee Number: From: 8/1/2024 To: 8/31/2024 ITEM DATE MEETING PURPOSE/ ISSUES DISCUSSED MILEAGE HOME to OWD OWD to HOME MILEAGE OTHER LOCATIONS 1 8/1/24 OWD Board Agenda Briefing 2 8/2/24 CV Chamber of Commerce First Friday Breakfast (NO CHARGE) 3 8/3/24 OWD OWD Employee Picnic (NO CHARGE) 4 8/6/24 WCG/JPA Water Conservation Garden 24 5 8/7/24 OWD Regular Board Meeting 19 6 8/8/24 OWD Committee Agenda Briefing 7 8/14/24 OWD Finance/Admin Committee Meeting 19 8 8/15/24 OWD Quarterly General Manager Meeting 9 8/27/24 OWD City CV/Sweetwater Auth/OWD 15 10 8/28/24 OWD Ad Hoc Salt Creek GC Committee 11 8/29/24 OWD Board Agenda Briefing 38 39 OTAY WATER DISTRICT BOARD OF DIRECTORS PER-DIEM AND MILEAGE CLAIM FORM Pay To: Gary Croucher Period Covered: Employee Number: From: 08/01/24 To: 08/31/24 ITEM DATE MEETING PURPOSE / ISSUES DISCUSSED (Via Teleconference) MILEAGE HOME to OWD OWD to HOME MILEAGE OTHER LOCATIONS 1 08/07/24 OWD Meeting Monthly Regular Board Meeting 2 08/13/24 OWD Meeting CPRL&L Committee Meeting 3 08/14/24 OWD Meeting Finance & Admin Committee Meeting 4 08/21/24 OWD Meeting CWA Matters Meeting with Director Smith and GM Martinez 5 6 7 8 9 OTAY WATER DISTRICT BOARD OF DIRECTORS PER DIEM AND MILEAGE CLAIM FORM Pay To: Ryan Keyes Period Covered: Employee Number: From: 8-1-24 To: 8-31-24 ITEM DATE MEETING PURPOSE / ISSUES DISCUSSED MILEAGE HOME to OWD OWD to HOME MILEAGE OTHER LOCATIONS 1 8-7-24 OWD Board Meeting Monthly Board Meeting 0 0 2 8-9-24 Quarterly Meeting with GM Quarterly Meeting with GM 0 0 3 8-21-24 UWI Conference Water Conference- Day #1 0 0 4 8-22-24 UWI Conference Water Conference- Day #2 0 0 5 8-23-24 UWI Conference Water Conference-Day #3 0 0 6 8-27-24 Inter-agency Water Task Force-Mtg Meeting with Chula Vista & Sweet Water 7 8-28-24 ACWA Regulatory Summer Committee ACWA Committee Meeting Mark Robak From:8/1/2024 8/30/2024 ITEM DATE MEETING PURPOSE / ISSUES MILEAGE HOME TO OWD OWD TO HOME MILEAGE OTHER LOCATIONS 1 8/1/2024 San Diego Regional Chamber of Commerce Sustainability & Industry Committee 0 0 2 8/1/2024 San Diego Regional Chamber of Commerce Business Mixer - NO CHARGE 0 0 3 8/2/2024 East County Chamber of Commerce First Friday Breakfast - NO CHARGE 0 0 4 8/3/2024 Otay Water District Picnic - NO CHARGE 0 0 5 8/6/2024 Water Conservation Garden JPA meeting 0 0 6 8/7/2024 Otay Water District Monthly Board Meeting 0 0 7 8/10/2024 Lakeside Water District 100th Anniversary Celebration - NO CHARGE 0 0 8 8/12/2024 Otay Water District Directors Quarterly Meeting with GM 0 0 9 8/13/2024 Otay Water District Conservation, Public Relations, Legal, and Legislative (CPRL&L) Committee 0 0 10 8/14/2024 Otay Water District Engineering, Operations, and Water Resources (EO&WR) Committee 0 15 11 8/15/2024 San Diego Chapter CSDA Quarterly Dinner Meeting - NO CHARGE 0 0 12 8/16/2024 South County EDC Binational Forum - NO CHARGE 0 30 13 8/21/2024 Urban Water Institute Annual Confererence 0 0 14 8/22/2024 Urban Water Institute Annual Confererence 0 45 15 8/23/2024 Urban Water Institute Annual Confererence 0 45 16 8/27/2024 San Diego Regional Chamber of Commerce Small Business Saturday Forum & Expo - NO CHARGE 0 0 17 8/27/2024 Otay Water District Ethics Training - NO CHARGE 0 0 18 8/28/2024 Otay Water District Ad-Hoc Salt Creek Committee 0 0 0 135 Pay To:Period Covered Employee Number OTAY WATER DISTRICT BOARD OF DIRECTORS PER-DIEM AND MILEAGE CLAIM FORM 1 MINUTES OF THE BOARD OF DIRECTORS MEETINGS OF THE OTAY WATER DISTRICT AND OTAY WATER DISTRICT FINANCING AUTHORITY October 2, 2024 1.The meeting was called to order by President Lopez at 3:36 p.m. 2.ROLL CALL Directors Present:Croucher, Keyes, Lopez, River and Robak Directors Absent:None Staff Present:General Manager Jose Martinez, Legal Counsel Jubani Estrada, General Counsel Dan Shinoff (Arrived at 4:18 p.m.), Chief of Engineering Michael Long, Chief Financial Officer Joe Beachem, Chief of Administration Adolfo Segura, Chief of Operations Andrew Jackson, Asst. Chief of Finance Kevin Koeppen, District Secretary Tita Ramos-Krogman and others per attached list. 3.PLEDGE OF ALLEGIANCE 4.APPROVAL OF AGENDA Legal Counsel Jubani Estrada stated that he and General Counsel Dan Shinoff determined that there were no significant updates to review and discuss in Closed Session and therefore recommended to strike Closed Session Items from the agenda. A motion was made by Director Croucher, seconded by Director Keyes, and carried with the following vote: Ayes: Directors Croucher, Keyes, Lopez, Rivera and Robak Noes: None Abstain: None Absent: None to strike Closed Session Items from the agenda. Legal Counsel Estrada introduced himself and indicated that he is stepping in for General Counsel Dan Shinoff who is on his way to the board meeting. 5.APPROVAL OF THE MINUTES OF THE REGULAR BOARD MEETING OF AUGUST 7, 2024, AND SPECIAL BOARD MEETINGS OF SEPTEMBER 6, 2024, AND SEPTEMBER 13, 2024 AGENDA ITEM 4 2 A motion was made by Director Croucher, seconded by Director Keyes, and carried with the following vote: Ayes: Directors Croucher, Keyes, Lopez, Rivera and Robak Noes: None Abstain: None Absent: None to approve the minutes of the regular board meeting of August 7, 2024, and special board meetings of September 6, 2024, and September 13, 2024. 6. PUBLIC PARTICIPATION – OPPORTUNITY FOR MEMBERS OF THE PUBLIC TO SPEAK TO THE BOARD ON ANY SUBJECT MATTER WITHIN THE BOARD'S JURISDICTION BUT NOT AN ITEM ON TODAY'S AGENDA No one wished to be heard. UCONSENT ITEM 7. ITEMS TO BE ACTED UPON WITHOUT DISCUSSION, UNLESS A REQUEST IS MADE BY A MEMBER OF THE BOARD OR THE PUBLIC TO DISCUSS A PARTICULAR ITEM: A motion was made by Director Croucher, seconded by Director Keyes and carried with the following vote: Ayes: Directors Croucher, Keyes, Lopez, Rivera and Robak Noes: None Abstain: None Absent: None to approve the following consent calendar items: a) ADOPT RESOLUTION NO. 4448 APPROVING THE ANNEXATION OF THE PROPERTY OWNED BY BOB & ANNE KELLY (APN 517-021-27-00, 1444 TINA COURT, EL CAJON, CA) TO OTAY WATER DISTRICT SEWER IMPROVEMENT DISTRICT NO. 18 b) ADOPT RESOLUTION NO. 4449 ALLOWING FOR THE REIMBURSEMENT OF CERTAIN EXPENDITURES FROM THE PROCEEDS OF THE WATER DEBT OBLIGATIONS OF THE DISTRICT, ANTICIPATED TO BE ISSUED DURING FISCAL YEAR 2026 c) ADOPT ORDINANCE NO. 595 AMENDING SECTION 6, CONFLICT OF INTEREST CODE (COIC), CONTAINED WITHIN THE DISTRICT’S CODE OF ORDINANCES TO UPDATE THE REQUIRED PROCESS TO FILE A FORM 700 3 ACTION ITEMS 8. BOARD a) DISCUSS THE 2024 BOARD MEETING CALENDAR District Secretary Ramos-Krogman indicated that the Engineering & Operations Committee and the Finance and Administrative Committee meetings will be held on October 16 at 9am and 12pm, respectively. In addition, a Communications, Public Relations, Legal and Legislative Committee meeting will be held on October 17 at 12pm. Ms. Ramos-Krogman also noted that the January 1, 2025, regular board meeting falls on a holiday and recommended to reschedule that meeting to January 8, 2025. A motion was made by Director Robak, seconded by Director Croucher and carried with the following vote: Ayes: Directors Croucher, Keyes, Lopez, Rivera and Robak Noes: None Abstain: None Absent: None to reschedule the January 1, 2025, regular board meeting to January 8, 2025, at 3:30 p.m. There were no changes to the board calendar. U INFORMATIONAL ITEMS 9. FOURTH QUARTER FISCAL YEAR 2024 CAPITAL IMPROVEMENT PROGRAM REPORT Engineering Manager Kevin Cameron provided a PowerPoint presentation to the board and responded to their questions and comments. Director Croucher requested that General Manager Jose Martinez and staff update the board on any delays that may impact the district. Director Keyes suggested that staff monitor the availability of supplies as it may cause delays if they are not readily available and costs may increase if supplies are high in demand. 10. ANNUAL DIRECTORS’ EXPENSE REPORT FOR FISCAL YEAR 2024 Assistant Chief Financial Officer Kevin Koeppen provided a PowerPoint presentation to the board. Mr. Koeppen stated that the presentation indicates title positions of board members (i.e. President, Vice President, Treasurer). Director Croucher stated that the Finance and Administrative Committee requested that title positions be indicated in the PowerPoint Presentation as it is pertinent to 4 show that the President, Vice President, and Treasurer have more responsibilities than regular board members. 11. FISCAL YEAR 2024 YEAR-END REPORT OF THE DISTRICT’S FISCAL YEAR 2023- 2026 STRATEGIC PLAN The board waived the presentation. REPORTS 12. GENERAL MANAGER REPORT Mr. Martinez provided his GM Report to the board and discussed the Municipal Information Systems Association of California’s (MISAC) 2024 “Excellence in IT Practices Award” and the Ralph W. Chapman Water Reclamation Facility Disinfection System Improvements. He also discussed that the State Water Resources Control Board approved the District’s private side service lateral inventory, which means there were no lead service lines found in the District’s service area. Mr. Martinez responded to questions from the board. 13. SAN DIEGO COUNTY WATER AUTHORITY UPDATE Director Croucher shared the names of new members on the CWA board and a new chairperson. He noted that he is no longer the immediate past chairperson. In addition, CWA is advertising an opening on MWD as former CWA member Tim Smith stepped down from the agency. However, MWD is allowing Mr. Smith to remain on board until CWA finds a replacement. Director Croucher discussed the retirement of Amy Chen, MWD Program Director, Water Resources Specialist. He also discussed CWA’s planning processes for the future and responded to questions and comments from the board. 14. DIRECTORS' REPORTS/REQUESTS Written reports from Directors Croucher, Keyes, Rivera and Robak were submitted to District Secretary Ramos-Krogman, which will be attached to the minutes for today’s meeting. 15. PRESIDENT’S REPORT A written report from President Lopez was submitted to District Secretary Ramos- Krogman and will be attached to the minutes for today’s meeting. OTAY WATER DISTRICT FINANCING AUTHORITY 16. NO MATTERS TO DISCUSS There were no items scheduled for discussion for the Otay Water District Financing Authority board. 5 17. ADJOURNMENT With no further business to come before the Board, President Lopez adjourned the meeting at 4:24 p.m. President ATTEST: District Secretary OTAY WATER DISTRICT BOARD OF DIRECTORS PER-DIEM AND MILEAGE CLAIM FORM Pay To: Jose Lopez Period Covered: Employee Number: From: 09/01/24 To: 09/30/24 ITEM DATE MEETING PURPOSE / ISSUES DISCUSSED MILEAGE HOME to OWD OWD to HOME MILEAGE OTHER LOCATIONS 1 09/03/24 OWD Interviews – Task Group 2 09/03/24 FLOW Friendship Latino on Water Meeting (NO CHARGE) 3 09/04/24 OWD Regular Board Meeting 19 4 09/06/24 OWD Special Board Meeting – Amazon Tour 19 5 09/09/24 OWD CSDA Conference – Indian Well, CA 169 6 09/10/24 OWD CSDA Conference – Indian Well, CA 7 09/11/24 OWD CSDA Conference – Indian Well, CA 8 09/12/24 OWD CSDA Conference – Indian Well, CA 169 9 09/13/24 OWD Committee Agenda Briefing (NO CHARGE) 10 09/13/24 OWD Special Board Meeting – Division 1 Director Rivera’s Oath of Office 19 11 09/19/24 OWD Finance & Admin Committee Meeting 19 12 09/26/24 OWD Board Agenda Briefing STAFF REPORT TYPE MEETING: Regular Board Meeting MEETING DATE: November 6, 2024 SUBMITTED BY: Tenille M. Otero PROJECT: Various DIV. NO. All APPROVED BY: Jose Martinez, General Manager SUBJECT: Presentation: 2024 End-of-Year Legislative Update GENERAL MANAGER’S RECOMMENDATION: No recommendation. This is an informational item only. COMMITTEE ACTION: See Attachment A. PURPOSE: To provide the Board with an update on the 2024 legislative session. ANALYSIS: To support the Otay Water District’s commitment to a safe, reliable, diversified, and cost-effective supply for its ratepayers, the District manages a legislative program that establishes guidelines and policy direction that can be used by staff and legislative advocates on issues important to the District. The guidelines provide a helpful framework for staff when evaluating the potential impact on the District of state or federal legislation or other policy decisions. The Board adopted the 2024 Legislative Policy Guidelines at the April 3, 2024 Board meeting. These guidelines were beneficial throughout the year when a timely response was necessary to address last-minute amendments to legislation and when calls or letters of support or opposition were needed. Brownstein Hyatt Farber Schreck (BHFS) monitors significant bills that could potentially impact the District and/or its ratepayers. Baltzar Cornejo from BHFS will present a legislative update on the 2024 legislative session. Please see Attachment B for a legislative report of the legislative session and Attachment C for the BHFS presentation. FISCAL IMPACT: Joe Beachem, Chief Financial Officer None. AGENDA ITEM 7 STRATEGIC GOAL: Enhance and build public awareness of the District’s priorities, initiatives, programs, and services. LEGAL IMPACT: None. Attachments: A) Committee Action B) Memo from BHFS C) Presentation ATTACHMENT A SUBJECT/PROJECT: Presentation: 2024 End-of-Year Legislative Update COMMITTEE ACTION: The Conservation, Public Relations, Legal, and Legislative Committee (Committee) reviewed these items at the monthly Board meeting on October 17, 2024, and the following comments were made: • The staff report was presented by Staff who noted that Brownstein, Hyatt, Farber and Schreck (BHFS) monitors significant bills throughout the year that could impact the district and/or its ratepayers. • Staff shared that BHFS helped the district achieve the passing of its second sponsored bill, SB 1072, which the Governor signed in September 2024. • BHFS Policy Advisor Mr. Baltazar Cornejo introduced his colleagues Mr. Brandon Knapp and Alicia Priego who will assist him with Otay Water District’s Legislative and Regulatory Priorities. They provided a PowerPoint presentation (Attachment C) to the Committee. • Mr. Baltazar discussed SB 1255 (Durazo), which is detailed on page 5 of the PowerPoint Presentation. He noted that the bill was defeated in the process. • With regards to Lead Testing Legislation, Mr. Baltazar shared that on October 8, the USEPA announced its final rule on lead and copper concerning drinking water. He noted that drinking water systems will have 10 years to identify and remove all lead pipes in their respective systems. He shared rules that require additional testing (details on page 8 of Attachment B) and comes with an announcement of $2.6 billion companion funding for lead pipe replacements through the Drinking Water State Revolving Fund and $15 billion through the Biden-Harris Bipartisan Infrastructure. • Mr. Baltazar indicated that AB 2079 (Bennett) failed to pass the Senate Natural Resources and Water Committee. The bill would have mandated greater interagency coordination and public notice regarding applications to drill water wells and prohibited a local agency from approving new “larger diameter, high-capacity” wells within one-quarter miles of domestic wells and areas of significant land subsidence, unless specifically exempted. • Mr. Baltazar responded to questions and concerns from the Committee with regards to the Delta Conveyance Project, Sites Reservoir, and State Water Project Operations. He stated that he will provide a financial update on how these projects are progressing and how it would impact Otay Water District. • There was a discussion on Proposition 4, SB 867 (Allen), Safe Drinking Water, Wildfire Prevention, Drought Preparedness and Clean Air Bond Act of 2024. Mr. Baltazar provided what ACWA advocated for (details on page 7 of the PowerPoint Presentation) and Ms. Priego shared that the Public Policy Institute of California (PPIC) showed a 55% approval rating for Proposition 4. Following the discussion, the Committee supported staff’s recommendation and presentation to the full board as an informational item. 30809411.1 www.bhfs.com Brownstein Hyatt Farber Schreck, LLP 916.594.9700 main 1415 L Street, Suite 800 Sacramento, California 95814 Memorandum Summary The California legislature reconvened on January 3, 2024, for the second year of the 2023-2024 regular session. A total of 2,159 bills were introduced, with the legislature passing 1206, sending them to Governor Gavin Newsom for consideration by the August 31, 2024 deadline for bills to pass each house. The Governor signed 1,017 and vetoed 189 for a veto rate of 15.7% by the September 30, 2024 deadline. The average veto rate over the past decade has been 15%, with this year’s rate being slightly above that average. The primary reasons for vetoes are as follows: Budget Impact Concerns – 30%; Unwarranted Policy Change – 27%; and Unnecessary – 22%. The California legislature is currently in the midst of a special session (2nd Extraordinary Session) to act on a proposal by the Governor to address spikes in gasoline prices. The Governor officially called the ongoing extraordinary session on August 31, 2024, to consider his proposal that would allow the state to require oil refiners to manage a minimum fuel inventory to avoid supply shortages that result in higher gasoline prices. The Assembly convened for the extraordinary session and approved the proposal. The Senate convened on Monday, October 7. This was a significant year as legislators introduced a wide array of legislation impacting public agencies. It was also a year of key successes, as public agency associations, member agency contract lobbyists, and allies successfully defeated significant problematic legislation, passed beneficial legislation, and impacted the enacted state budget. This session was also a year of changes to key water leadership positions. Governor Newsom named Department of Water Resources Director Karla Nemeth as his advisor on the Administration’s water priorities and tasked her with implementing the Governor’s water supply strategy, which includes modernizing California’s water conveyance infrastructure, executing agreements to support healthy rivers and landscapes, and stabilizing Colorado River supplies. DATE: October 8, 2024 TO: Board of Directors and General Manager Jose Martinez, Otay Water District FROM: Baltazar Cornejo, Policy Advisor, Brownstein Hyatt Farber Schreck, LLC RE: 2024 End-of-Session Legislative Update Attachment B 2 With a new Speaker of the Assembly and President Pro Tem being selected last year, changes came in key committee leadership positions. Speaker Robert Rivas (D-Salinas) appointed Assemblywoman Diane Papan (D-San Mateo) as Chair of the Assembly Water, Parks, and Wildlife Committee, replacing former Chairwoman Rebecca Bauer Kahan (D-Orinda). In the Senate, President Pro Tem Mike McGuire (D-Healdsburg), who succeeded former Pro Tem Toni Atkins (D-San Diego), appointed Senator Dave Min (D-Irvine) to replace Senator Henry Stern (D-Calabasas). Former Senate President Pro Tem Toni Atkins announced that she would be running for Governor in the 2026 gubernatorial elections. The Association of California Water Agencies (ACWA) also saw some late-session changes in key advocacy positions. Senior State Relations Advocate Kristopher Anderson departed ACWA on August 9, 2024, to join the California Chamber of Commerce as their new water policy advocate. Following Mr. Anderson’s departure, State Relations Director Adam Quiñonez departed on Oct. 4. State Budget This was another difficult year of revenues for the state after surpluses during the COVID-19 pandemic. Last year’s adopted budget faced a nearly $32 billion budget deficit. According to the State Analyst Office, this year’s budget deficit was $58 billion based on revenue projections at the time of the Governor’s Budget proposal in January. Later revenue numbers brought that estimate closer to $73 billion, with debate about the true number as we approached the May revision. Such a significant budget problem made any additional spending difficult. The adopted 2024-2025 budget maintained $6.7 billion of the 2021-2022 significant year of $8.7 billion of investments over multiple years in programs and projects to address droughts and floods. The budget included $1.4 billion in General Fund reductions and $539.1 million in fund shifts across various programs. The budget also included $189.1 million in new one-time investments to support flood protection, levee repair, and restoration of the Salton Sea. The Budget includes a $123.9 million one-time General Fund to support critical flood safety efforts. These include, but are not limited to: - $33 million General Fund to support the state cost share of continuing U.S. Army Corps of Engineers projects and Urban Flood Risk Reduction projects that address flood risk reduction. - $31.3 million General Fund to support the continuation of existing multi-benefit flood risk reduction projects in the Central Valley. - $29.6 million General Fund to address storm damage at state Plan of Flood Control facilities and state-owned Delta lands for critical repairs associated with the 2023 storms. To address the projected budget shortfall, the adopted budget contained the following changes: - A reversion of $88.4 million and reduction of $298 million General Fund over the next two years, and a shift of $15 million to Greenhouse Gas Reduction Fund (GGRF) in 2025-26 for various watershed climate resilience programs, maintaining $108 million previously allocated. 3 - A reversion of $97.6 million General Fund and a shift of $254.9 to GGRF in 2024-25 and 2025- 26 for drinking water and wastewater infrastructure projects in disadvantaged communities, maintaining $1.6 billion previously allocated. - A reversion of $185.9 million General Fund and a fund shift of $15 million GGRF in 2025-26 for water recycling and groundwater cleanup, maintaining $336 million previously allocated. - A reduction of $500 million General Fund in 2025-26 for water storage projects. - A reversion of $100.7 million General Fund and reduction of $30 million in 2024-25 for per-and polyfluoroalkyl substances support, maintaining $24 million previously allocated. - A reversion of the $50 million General Fund for dam safety investments, maintaining the $50 million previously allocated. A significant win for the water community in the budget included the restoration of nearly $500 million for the agreements to support healthy rivers and landscapes, formerly known as the Voluntary Agreements, for the updates to the Bay-Delta Quality Control Plan. The funding was previously rescinded in the main budget bill, AB 107 (Gabriel). ACWA, the Northern California Water Association, the State Water Contractors, and various other organizations successfully lobbied to maintain almost all funding. Water Bond Otay joined ACWA is advocating for a $7.85 billion bond investment in water infrastructure for recycled water, groundwater recharge, storage, flood protection, dam safety, conveyance, storage, safe drinking water, water quality, regional watershed resilience, State Water Project improvements, and water conservation. Although three water-related bond measures were introduced during last year’s session, they were held until this year as the Governor wanted the voters’ focus for this year’s primary election to be on his mental health initiative. Only two bond measures were passed by the legislature and placed on the November ballot, with one being a climate and resources bond. ACWA ultimately adopted a “Watch” (neutral) position as they sought 2/3 of the overall amount for water but ended up with less than 1/3 with minimal investments in critical categories. The proposed climate bond supplements the cuts that were made to the general fund budget. Proposition 4, placed on the November ballot by SB 867 (Allen): Safe Drinking Water, Wildfire Prevention, Drought Preparedness, and Clean Air Bond Act of 2024, contains the following breakdown of funding: • $3.8 billion for safe drinking water, drought, flood, &water resilience programs (see below for breakdown). • $1.5 billion for wildfire and forest resilience programs. • $1.2 billion for coastal resilience programs. • $450 million for extreme heat mitigation programs. • $1.2 billion for biodiversity protection and nature-based climate solution programs. 4 • $300 million for climate-smart, sustainable, resilient farms, ranches, and working lands programs. • $700 million for park creation and outdoor access programs. • $850 million for clean air programs. Below is a breakdown of what ACWA advocated for, and what ultimately ended up in the initiative: Surface Water Storage • Ask: $550 million • Initiative: $75 million State Water Project • Ask: $500 million • Initiative: $0 Regional Water Conveyance • Ask: $600 million • Initiative: $75 million Dam Safety/informed Reservoir Ops • Ask: $700 million • Initiative: $480 million Recycling & Desal (brackish, not ocean) • Ask: $1 billion • Initiative: $448.75 million Regional Watershed Conveyance • Ask: $700 million • Initiative: $100 Safe Drinking Water & Clean Up • Ask: $500 million • Initiative: $610 million Groundwater Management • Ask: $750 million • Initiative: $386.25 million Flood Protection • Ask: $950 million • Initiative: $660 million Water Conservation • Ask: $400 million • Initiative: $75 million Water Affordability Otay’s identified top priority for this year’s session is affordability. This was also a key issue addressed in this legislative session. As such, a trio of bills introduced this session by public water agencies, all aiming to protect their water rates and service-related fees and charges against costly Proposition 218 litigation by high water users, were signed into law by the Governor. • AB 2257 (Wilson): The ACWA-sponsored bill provides that if a local agency complies with specified exhaustion of remedies procedures for purposes of any fee of assessment adopted by that local agency pursuant to Section 4 or 6 of Article XIII D of the California Constitution (Proposition 218), then a person or entity that has not timely submitted to that local agency a written objection, as specified, is prohibited from bringing a judicial action or proceeding alleging noncompliance with those constitutional provisions and limits a record of proceedings in court to containing specified documents, except specified. • AB 1827 (Papan): Irvine Ranch Water District and California Coastkeeper Alliance’s sponsored bill provides that fees or charges for property-related water service imposed or increased pursuant to the state Constitution may include the incrementally higher costs of water service. 5 • SB 1072 (Padilla): Otay Water District and the City of San Diego’s sponsored bill provides that if a court determines that a fee or charge for a property-related service violates Proposition 218, then the local agency must credit that amount against the cost of providing the property- related service, unless statute explicitly provides a refund remedy. It also provides that this section does not apply to claims related to billing errors. Brownstein policy professionals, with assistance from Otay staff and private counsel, worked with Senator Padilla’s office to maneuver the bill through the legislative process, developed and led a coalition in support, and lobbied the Governor’s office for his signature. All these bills had significant coalitions in support and, while not an official package, complement each other by addressing various aspects of Proposition 218 rate-making procedures and litigation. Beginning next year, public agencies will have more clarity on rate-making methodologies, more opportunities for agencies and ratepayers to resolve objections during the public process to avoid future litigation, and if agencies are sued, ensure that agencies and future ratepayers do not get overburdened with retroactive refunds. With these new laws, the landscape of Proposition 218 litigation has changed. During the height of the COVID-19 pandemic, the federal government funded a Low-Income Household Water Assistance Program (LIHWAP) to provide financial assistance to low-income Californians with residential water utility costs and debt repayment. California was allocated $116 million in one-time funding to provide LIHWAP assistance through the Department of Community Services and Development (CSD). In response to low LIHWAP participation and grant expenditures, CSD expanded eligibility to include current bills to maximize grant expenditures. LIHWAP benefit payments began to be issued to households in June 2022, with all funds being expended by March 31, 2024, when the program sunset. Interest in water affordability and the sunset of LIHWAP also led to a well-intentioned but highly problematic bill being introduced and ultimately stopped. • SB 1255 (Durazo): Creating a statewide Low-Income Rate Assistance program would have required agencies to provide each ratepayer the option and method of opting out of paying voluntary contribution at least three months prior to beginning collection of the voluntary contribution and at least annually after. ACWA opposed and proposed amendments for an opt- in program, as otherwise, many ratepayers could end up paying voluntary contributions without their knowledge by not reviewing their water bills, resulting in public distrust of the agencies, and refund requests that would increase administrative costs and therefore limiting funding for the program itself. Due to coordinated opposition, the bill failed to make it out of the Assembly Appropriations Committee’s suspense file. On the federal level, United States Senator Alex Padilla introduced S. 3830, which would establish a permanent, nationwide water assistance program that is modeled after the current program to authorize grants to States, Territories, and Tribes to assist low-income households in paying arrearages and other rates charged to such households for drinking water or wastewater services. This would provide technical assistance to rural, Tribal, and underserved owners or operators of public water systems or treatment works; align income eligibility with the Low-Income Household Energy 6 Assistance Program (LIHEAP), Temporary Assistance for Needy Families (TANF), Supplemental Nutrition Assistance Program (SNAP), Supplemental Security Income, and means-tested veterans’ programs; and transfer authority of the program from Health and Human Services to the U.S. Environmental Protection Agency (USEPA) upon completion of the Rural and Low-Income Water Assistance Pilot Program authorized in the Bipartisan Infrastructure Law. The bill is still pending in the Senate. Representative Pat Fallon (R-TX) and Representative Brittany Pettersen (D-CO) introduced H.R.7525, which requires Federal agencies to recognize special districts as local government for the purpose of Federal financial assistance determinations, and also codifies in federal law a first-ever, formal definition of "special district”. The bill passed the House 352 to 27 and is pending in the Senate. Following the successful House passage of H.R. 7525 in May 2024, U.S. Senators Kyrsten Sinema (I-AZ) and John Cornyn (R-TX) introduced a companion version of the Special District Grant Accessibility Act (SDGAA – S. 4673), which is pending action. Regulatory Developments & Related Legislation Regarding potable reuse, on December 19, 2023, the State Water Resources Control Board (State Water Board) approved regulations that allow water systems to develop treatment protocols to convert wastewater into high quality drinking water, known as direct potable reuse. California’s Office of Administrative Law (OAL) approved OAL File No. 2024-0624-02S – the Direct Potable Reuse Regulations – and filed with the Secretary of State on August 6, 2024. The regulations took effect on October 1, 2024. The rules require extensive treatment and monitoring with various steps designed to remove chemicals and pathogens that remain in sewage after it has already undergone traditional primary, secondary, and sometimes tertiary treatment. Regarding water use and efficiency, on August 18, 2023, the State Water Board released regulations to establish water-use efficiency goals for urban retail water suppliers in compliance with the 2018 conservation legislation, Senate Bill 606 (Hertzberg) and Assembly Bill 1668 (Friedman). The regulation establishes unique efficiency goals for each supplier based on local conditions, leaving some flexibility to implement locally appropriate solutions. Furthermore, in 2022, SB 1157 (Herzberg) was adopted to change the standards for indoor residential water use to align with those recommended by DWR beginning in 2025 to 47 gallons per capita daily (GPCD) and beginning in 2030 to 42 GPCD. In response to a critical Legislative Analyst Office report released in January calling the proposed regulations “costly and difficult to achieve,” Board staff proposed less stringent water-saving standards, reducing the number of suppliers that would be required to achieve large cuts of more than 20%, and extending the timeline for water reductions an additional five years to 2040. The Board unanimously adopted the regulation on July 3, 2024 to start taking effect in 2025. Under the regulation, urban retail water suppliers must comply with three major components: • An urban water use objective, which is a supplier specific water budget that is the sum of water use efficiency standards that are applied to unique local characteristics (e.g., population, landscape area, etc.) 7 • Commercial, industrial, and institutional (CII) performance measures • Annual reporting ACWA collaborated with its members and coalition partners to secure extensive amendments that resulted in a more feasible and cost-effective regulation, including: • Changes to timelines for the outdoor water use standard and CII performance measures. • Inclusion of feasible alternative compliance pathways. • Modifications to compliance start date. • Inclusion of 20% of suppliers’ irrigable, not irrigated area. • Changes to processes requesting variances & temporary provisions and the inclusion of a tree variance. Suppliers must work with their customers to achieve water savings to meet the new regulation as individual customers are not required to comply with the urban water use objective. Beginning Jan. 1, 2025, and by Jan. 1 every year thereafter, each urban retail water supplier is required to calculate its urban water use objective for the previous year. Each year, the objective will be based on dynamic data such as weather and population. Beginning January 1, 2027, each urban retail water supplier must demonstrate compliance with its urban water use objective. There were several bills introduced this session to delay implementation and reporting that failed to move forward but placed increased pressure on the Water Board to amend its proposed regulations: • SB 1330 (Archuleta): Would have delayed the State Water Board’s authority to enforce the urban water use objective, deletes obsolete reporting requirements, requires DWR to study efficiency performance of certain classes of landscapes, requires LAO to complete another report on the implementation of the urban water use objective by January 10, 2029. • AB 3121 (Hart): Would have delayed by two years when the State Water Board may begin issuing orders to enforce the urban water use objective and require the LAO to report to the Legislature on implementation of the urban water use objective by January 10, 2028. • SB 1110 (Ashby): Would have permitted the State Water Board to adopt a policy to guide its enforcement of urban water use objective regulations, delay enforcement of the objectives by two years, consolidate reporting on urban water use, and allow water agencies to report on a calendar or fiscal year basis. Regarding water quality, on April 17, 2024, the State Water Board adopted the Hexavalent Chromium maximum contaminant level (MCL) of 10 parts per billion (ppb). The regulation applies to all water suppliers, including small public water systems. It was approved by the Office of Administrative Law on July 24 and took effect on October 1, 2024. On April 10, the USEPA announced a new national MCL of 4 parts per trillion (ppt) for PFOA and PFOS as individual contaminants and a standard of 10 ppt for three other chemicals — PFNA, PFHxs, and HFPO-DA. This enforceable rule requires public water systems to monitor for these PFAS, notify the public of the levels of these PFAS, and reduce their levels in drinking water if they exceed the MCL. Public agencies have five years to come into compliance. 8 Furthermore, the California Office of Environmental Health and Hazard Assessment on April 5 adopted public health goals of 0.007 ppt for PFOA and 1.0 ppt for PFOS. A public health goal is a drinking water objective that does not pose a significant risk to health. It is not enforceable but serves as the basis for developing maximum contaminant levels. Assemblyman Holden introduced legislation this year to address the Governor’s veto of his AB 249 from last year, which would have required, on or before January 1, 2027, a community water system that serves a school site receiving federal Title I funds to test for lead in each of the school site’s potable water system outlets and to report the results to the SWB and applicable school site or LEA; would have required LEAs or school sites, if lead levels exceeded five ppb, to perform specified actions. • AB 1851 (Holden): Would have required the Superintendent of Public Instruction (SPI) to provide grants to participating local educational agencies (LEAs) for testing drinking water lead levels, remediating lead in drinking water at eligible facilities, and contracting with a technical assistance (TA) provider. The bill failed in the process. On Tuesday, October 8, 2024, the USEPA announced its final rule on lead and copper concerning drinking water. Drinking water systems will have 10 years to identify and remove all lead pipes in their respective systems. The rules require additional testing if drinking water supplies and lowers action thresholds, requires more communications at the community level, and comes with an announcement of $2.6 billion companion funding for lead pipe replacements through the Drinking Water State Revolving Fund and at least $15 billion through the Biden-Harris Bipartisan Infrastructure Act. The USEPA will be offering webinars over the next few months to help drinking water utilities understand the new rule. Furthermore, on December 19, 2023, the final draft of the Cross Connection Control Policy Handbook was approved by the State Water Board. This handbook replaces portions of Title 17 that address cross-connection and backflow regulations. The District will be required to provide a Cross Connection Control Plan to the board by July 1, 2025. District staff provided comments regarding portions of the handbook that will result in an increased workload for the District and additional costs to customers. Regarding advanced clean fleets rule implementation, the California Air Resources Board (CARB) has been hosting workshops on targeted amendments to the Advanced Clean Fleets (ACF) regulation adopted last year to implement the requirements of AB 1594 (Garcia, 2023), which the District supported to provide more accommodations for public agencies in the adopted regulation. Below are Proposed amendments to the public fleets provisions from the most recent workshop on October 3, 2024: • Definition added for “traditional utility-specialized vehicle” for public agencies (including Class 3-8 vehicles) to be applied to the Zero Emissions Vehicles (ZEV) Purchase Exemption and Daily Usage Exemption • Specifies early access (less than 13 years to retire the vehicle) 9 • Added criteria of usage data by vehicle class (mileage and hours of operation thresholds) that provide you “early” access to the Daily Usage Exemption and ZEV Purchase Exemption. ACWA staff has reported that CARB has affirmed that the addition of the Traditional Specialty Utility Vehicles definition and provisions entails that public fleets can avoid the 13-year requirement that applies to the ZEV Purchase Exemption and Daily Usage Exemption pathways by submitting a vehicle purchase plan OR demonstrating that an agency’s sting fleet vehicle exceeds the mileage/usage thresholds identified. CARB also clarified how they will review exemption requests made during 2024-2026 as agencies contend with the 50% new purchase requirement. Internal Combustion Engine (ICE) vehicles listed in the Purchase List will not be a separate category from 50/50 purchases. They are likely to evaluate requests for an exemption based on an agency’s current vehicle purchases for the year and if any of their ICE purchases could have been made to purchase ZEVs. Extreme Weather, Floods and Droughts On March 24, 2023, the Governor issued an executive order amending the Emergency Drought Proclamation and previous executive orders on conservation. • Ended the voluntary 15% water conservation target, • Ended requirement that local water agencies implement level 2 of their drought contingency plans, • Retained a state of emergency for all 58 counties to allow for drought response and recovery efforts, • Retained the non-functional turf irrigation ban in commercial, industrial, and institutional areas, including HOA common, set to expire in June 2024 unless the Board takes further action. • Emergency Regulation to Prohibit Wasteful Water Uses (refilling fountains without recirculating pumps, overwatering landscapes, watering grass within 48 hours of rainfall, etc.) expired in December 2023. Governor Newsom in September 2024 terminated the above-described drought state of emergency in 19 counties where conditions have improved significantly, maintaining it in the remaining 39 counties to address continued impacts to local water supplies and facilitate ongoing recovery. The 19 counties include: Imperial, Inyo, Los Angeles, Marin, Mendocino, Mono, Monterey, Orange, Riverside, San Bernardino, San Diego, San Francisco, San Luis Obispo, San Mateo, Santa Barbara, Santa Clara, Santa Cruz, Sonoma, and Ventura counties. Delta Conveyance, Sites Reservoir & State Water Project Operations This year also marked significant progress in two major storage and conveyance projects, the Delta Conveyance Project (DCP), formerly known as WaterFix, and the Sites Reservoir storage project. 10 Regarding the delta conveyance project, on December 8, 2023, the Department of Water Resources (DWR) released the final environmental impact report (EIR) and certified it on December 21, 2023. Following the certification, various environmental organizations filed suits in late January 2024. On May 16, 2024, DWR released a Benefit Cost Analysis of DCP that found that the DCP would create billions of dollars in benefits for communities across California, including reliable water supplies, climate change adaptation, earthquake preparedness, and improved water quality. On June 20, 2024, the Sacramento County Superior Court halted DWR from undertaking further geotechnical investigations implementing the DCP until DWR files a certification of consistency with the Delta Stewardship Council as required under the Sacramento-San Joaquin Delta Reform Act of 2009. DWR posted a draft certification of consistency for the 2024-2026 Proposed Geotechnical Activities proposed action. This draft certification only concerned certain geotechnical activities related to data collection, such as cone penetration tests, soil borings, and water quality sampling within soil borings. Planning and design geotechnical data collection from the 2024-2026 Proposed Geotechnical Activities is important to inform the planning and design of the DCP, and future discretionary permitting and funding decisions by DWR and other agencies. DWR did not originally plan to submit a certification of consistency for these 2024-2026 Proposed Geotechnical Activities but did so based on the Sacramento Superior Court’s June 20 ruling. On August 1, 2024, the State Water Board released a notice of public hearing regarding the Delta Conveyance Project. The hearing on January 16, 2025, will address DWR’s water right change petitions to add new points of diversion and rediversion to the water rights of the State Water Project (SWP), whether to approve the petitions and what terms and conditions to include in the amended permits. On September 17, the State Water Board released a Notice of Pre-Hearing Conference and Procedural Ruling for October 17 regarding DWR’s pending Petitions for Change of Water Rights Permits associated with the State Water Project. The prehearing conference will address DWR’s withdrawal of the petitions for water rights extension of time and request to amend the change petitions. Regarding the Sites Reservoir Project, in early November of last year, the Governor announced he had certified the project under SB 149 (Caballero, 2023), which allows the Governor to certify qualifying infrastructure projects for judicial streamlining under the California Environmental Quality Act (CEQA), which provides that courts must decide CEQA challenges within 270 days to the extent feasible. In mid-November, the Bureau of Reclamation and Sites Project Authority certified its final Environmental Impact Report (EIR) and was approved to proceed. Conservation & environmental justice groups the Friends of the River, Center for Biological Diversity, California Sportfishing Protection Alliance, California Water Impact Network, Save California Salmon, and Sierra Club filed a suit on December 20, 2023, against the EIR approval. In June of this year, a Yolo County judge denied the suit to stop the project. The plaintiffs appealed the decision in the Third Appellate District Court with Friends of the River v. Sites Project Authority. That CEQA legal challenge was further defeated on September 20, with the appellate court ruling building on victory in the trial court. 11 Regarding the State Water Project, each year, DWR makes an initial SWP allocation on December 1. Allocations are updated as snowpack and runoff information are assessed, with a final allocation typically determined in May or June. DWR announced its initial SWP allocation of 10% for 2024 on December 1, 2023. DWR announced a final increase in the State Water Project (SWP) water supply allocation forecast for 2024 on April 23 to 40%. It is important to note that last year’s allocations eventually reached 100% for the first time since 2006. Water Rights and Groundwater Regarding water rights modernization, due to extreme weather patterns and greater federal level discussions on the Colorado River water rights, water rights rose to the top of the Legislature’s agenda last year. Several bills were introduced last year that collectively presented a fundamental change in California’s water rights system, and a coordinated effort occurred to fundamentally change how the water rights system is implemented and enforced. The remaining bills that were considered this session included: • AB 1337 (Wicks): Would have given the State Water Board authority to adopt sweeping curtailment regulations for water conservation purposes to prevent waste, unreasonable use, or unreasonable method of diversion of water. Failed in legislative process. • AB 460 (Bauer-Kahan): Would have authorized the State Water Board to issue an interim relief order on water rights. ACWA removed opposition due to negotiated amendments that removed problematic provisions related to regulatory and enforcement issues and instead raised the penalties for illegal diversions. Signed into law. ACWA considered proposing its own water rights legislation as an alternative to the above-described legislation, however no agreement was reached by its membership. Instead ACWA successfully led a coalition in opposition to the above-described legislation. Regarding groundwater, as the state celebrated the 10-year anniversary of the Sustainable Groundwater Management Act (SGMA), two controversial bills that would have convoluted existing Sustainable Groundwater Management Act implementation efforts were introduced. The first, a DWR- sponsored bill that would have banned new groundwater wells was defeated by a coalition of public water agencies, special districts, local governments, agricultural organizations, and chambers of commerce. • AB 2079 (Bennett): Would have mandated greater interagency coordination and public notice regarding applications to drill water wells and prohibited a local agency from approving new “large diameter, high-capacity” wells within one-quarter mile of domestic wells and areas of significant land subsidence, unless specifically exempted. The bill failed to pass the Senate Natural Resources and Water Committee. The second is a bill supported by ACWA members, Grasslands Water District but opposed by ACWA and agricultural organizations. 12 • AB 828 (Connolly): Would have prohibited a groundwater sustainability agency (GSA) from imposing a fee upon a small community water system serving a disadvantaged community or on a managed wetland, meaning that a GSA would be unable to regulate or impose fees on those uses, increasing the share of the burden on all other groundwater extractors. This bill passed the legislature but was vetoed by the Governor. Furthermore, in regard to SGMA implementation, in a first and second in the history of California, the State Water Board placed two San Joaquin Valley farming regions on probation, the Tulare Lake subbasin and the Tule subbasin, for inadequate groundwater sustainability plans to address chronic over pumping. Following the decision to place the Tulare Lake subbasin on probation, the Kings County Farm Bureau sued, and the judge ruled in favor of issuing an injunction to halt the costly probationary demands issued against the region’s water users until the matter goes to trial. The State Water Board has appealed the injunction to the Fifth District Court of Appeal in Fresno. Several groundwater recharge bills were introduced this year to build on the momentum of the Governor's Executive (EO) issued in March of 2023 regarding flood flows and the legislation codifying it into law. To use last wet winter’s high water flows for groundwater recharge, the Governor issued EO N-4-23, which authorized diverters to temporarily take flood flows off of streams and rivers for groundwater recharge without obtaining a water right, complying with the California Environmental Quality Act, and obtaining a Lake and Streambed Alteration Agreement. The authority in EO N-4-23 was modified and extended through EO N-7-23 and codified into law with SB 122 (Committee on Budget). The most notable bills introduced but which failed to move forward were: • AB 2060 (Soria): Would have exempted a temporary urgency permit to divert water for underground storage from Lake and Streambed Alteration Agreement requirements if the water diversion commences before January 1, 2029, and met certain criteria. Failed in the process. • SB 1390 (Caballero): Would have allowed more groundwater projects to move forward during flood events by providing water agencies with information about when flood conditions start and end using sophisticated forecasting models to anticipate flood events. Failed in the process. Other Impactful Legislation To address California’s housing supply shortage, a trend has developed in the legislature over the past few years to introduce and pass legislation that inhibits local control on zoning authority and development fees. Recent casualties of those efforts are local public agencies. While ACWA and other public agency associations were successful in working to amend some of the legislation, a concerning bill was signed into law. • SB 937 (Wiener): Amends the Mitigation Fee Act, which governs the collection of development-related fees that pay for the costs to install infrastructure necessary to build new homes and other developments by deferring development-related fees until the certificate of occupancy or its equivalent and limiting exceptions to this rule. 13 Other water legislation approved by the Governor included: • AB 805 (Arambula): This authorizes the State Water Board to require a designated sewer system—for a sewer system serving a disadvantaged community that has demonstrated a failure to maintain technical, managerial, and financial capacity to prevent waste, fraud, and abuse—to contract with an administrator designated or approved by the board. • SB 1188 (Laird): This bill provides small water systems with technical resources to prevent failure. • AB 2454 (Lee): This requires that rental property owners participate in state programs for domestic well testing to determine if remediation is needed. A bill supported by the District, but which was vetoed: SB 366 (Caballero): Would have required the Department of Water Resources, as part of the 2033 update, to revise the contents of the California Water Plan to focus on developing a long-term water supply planning target for 2050 to identify and create plans for future water needs of various water sectors. Otay Water District Legislative & Regulatory Priorities for 2024 End of Session Overview Presented by: Baltazar Cornejo Policy Advisor November 6, 2024 Attachment C Legislative & Regulatory Priorities 2024 End of Session Overview 2 © 2021 Brownstein Hyatt Farber Schreck, LLP www.bhfs.com | Legislative Update •Legislature reconvened on January 3, 2024. •In 2024, a total of 2,124 bills introduced were introduced by the February 16th deadline for bill introductions. 1206 bills were sent to the Governor’s desk, and of those, he signed 1,017 and vetoed 189, for a veto rate of 15.7%. The average veto rate over the past decade has been 15%, so this year’s rate is slightly above that average. •The California legislature is currently in a special session (2nd Extraordinary Session) to act on a proposal by Governor Gavin Newsom to address spikes in gas prices. •Key Legislative Deadlines: —January 10 – Governor’s Budget Proposal —February 16 – Bill Introduction deadline —May 15 – May Revision of the January Budget (“May Revise”) —May 24 – Last day for each house to pass bills introduced in that house. (“House of Origin Deadline”). —June 15 – Budget must be passed by midnight —August 31– Deadline to pass bills out of Legislature. (“Final Recess upon Adjournment of Session”) —September 30 – Last day for Governor to sign or veto bills passed on or before September 1 3 © 2021 Brownstein Hyatt Farber Schreck, LLP www.bhfs.com | 1. Affordability & Proposition 218 • Low-Income Household Water Assistance Program (LIHWAP) —In 2020, the federal government funded LIHWAP to assist low-income Californians with residential water utility costs and debt repayment. —California has been allocated $116 million in one-time funding for LIHWAP assistance. —Administering Agency – Department of Community Services and Development (CSD). •In response to low LIHWAP participation and grant expenditure, CSD expanded eligibility to include current bills to maximize grant expenditures. •LIHWAP benefit payments began to be issued to households in June 2022, and all funds must be expended by March 31, 2024, when the program sunset. •Federal Legislation —United States Senator Alex Padilla has introduced S. 3830, which would establish a permanent, nationwide water assistance program that is modeled after the current program to authorize grants to States, Territories, and Tribes to assist low-income households in paying arrearages and other rates charged to such households for drinking water or wastewater services. Would provide technical assistance to rural, Tribal, and underserved owners or operators of public water systems or treatment works; align income eligibility with the Low Income Household Energy Assistance Program (LIHEAP), Temporary Assistance for Needy Families (TANF), Supplemental Nutrition Assistance Program (SNAP), Supplemental Security Income, and means-tested veterans’ programs; & transfer authority of the program from HHS to the EPA upon completion of the Rural and Low-Income Water Assistance Pilot Program authorized in the Bipartisan Infrastructure Law. Pending in Senate. —Representative Pat Fallon (R-TX) & Representative Brittany Pettersen (D-CO) introduced H.R.7525 which requires Federal agencies to recognize special districts as local government for the purpose of Federal financial assistance determinations. & codifiers in Federal law a first-ever, formal definition of "special district.“ Passed the House 352 – 27 and pending in the Senate. Following the successful House passage of H.R. 7525 in May, U.S. Senators Kyrsten Sinema (I-AZ) and John Cornyn (R-TX) introduced a companion version of the Special District Grant Accessibility Act (SDGAA – S. 4673). 4 © 2021 Brownstein Hyatt Farber Schreck, LLP www.bhfs.com | •Three Bills introduced this session to address issues with Proposition 218 to protect public agencies from lawsuits costing them millions in refunds to high consumptive water user plaintiffs. Successful passage of all three bills has altered the landscape of Prop 218 litigation. —Association of California Water Agencies (ACWA) sponsored Assembly Bill 2257 (Wilson), which would aid public agencies in defending against Proposition 218 lawsuits by requiring litigants to participate and raise specific objections during the public administrative process. In doing so, this proposal intends to bring to light all possible complaints and provide an opportunity to resolve a dispute and avoid litigation altogether. Signed into law on Sept. 24th. —Irvine Ranch’s sponsored Assembly Bill 1827 (Papan), which would clarify that water agencies can use existing reasonable and well-accepted methods for allocating the incremental costs associated with higher water usage (peaking) demands to impose fees that reflect the costs associated with higher usage demands. Signed into law on Sept. 22nd. —Otay’s sponsored Senate Bill 1072 (Padilla) provides that if a court determines that fee or charge for a property-related service, including water, sewer, and refuse collections, violates Proposition 218, then the local agency must, in the next procedure to impose or increase the fee or charge, credit that amount against the cost of providing the property related service, unless statute explicitly provides a refund remedy. Signed into law on Sept. 20th. •Concerning Bill Defeated -(SB 1255, Durazo) was defeated in the process, which would have required agencies to provide each ratepayer the option and method of opting out of paying voluntary contribution at least three months prior to beginning collection of the voluntary contribution, and at least annually after for a ratepayer assistance program. ACWA preferred an opt-in program as many ratepayers could end up paying voluntary contributions without their knowledge by not reviewing their water bills, resulting in public distrust of the agencies and refund requests that would increase administrative costs and limit funding for the program. 5 © 2021 Brownstein Hyatt Farber Schreck, LLP www.bhfs.com | 2. Water Bonds & Infrastructure Otay joined ACWA is advocating for a $7.85 billion bond investment in water infrastructure for recycled water, groundwater recharge, storage, flood protection, dam safety, conveyance, storage, safe drinking water, water quality, regional watershed resilience, State Water Project improvements, and water conservation. While three bond measures were introduced last year, they were made 2-year bills as the Governor wanted to focus on his Mental Health Proposal for the primary election. The legislature passed only one bond measure and placed it on November ballot. ACWA ultimately adopted a “Watch” (neutral) position as they sought 2/3 of the overall amount for water but ended up with less than 1/3 with minimal investments in critical categories. Proposition 4: SB 867 (Allen): Safe Drinking Water, Wildfire Prevention, Drought Preparedness, and Clean Air Bond Act of 2024. •$3.8 billion for safe drinking water, drought, flood, &water resilience programs (Next page for breakdown) •$1.5 billion for wildfire and forest resilience programs •$1.2 billion for coastal resilience programs •$450 million for extreme heat mitigation programs •$1.2 billion for biodiversity protection and nature-based climate solution programs •$300 million for climate-smart, sustainable, and resilient farms, ranches, and working lands programs •$700 million for park creation and outdoor access programs •$850 million for clean air programs. 6 © 2021 Brownstein Hyatt Farber Schreck, LLP www.bhfs.com | ACWA’s Coalition Asks vs Bond Initiative Surface Water Storage •Ask: $550 million •Initiative: $75 million State Water Project •Ask: $500 million •Initiative: $0 Regional Water Conveyance •Ask: $600 million •Initiative: $75 million Dam Safety/informed Reservoir Ops •Ask: $700 million •Initiative: $480 million Recycling & Desal (Specific to desalination funding for brackish water, not ocean) •Ask: $1 billion •Initiative: $448.75 million Regional Watershed Conveyance •Ask: $700 million •Initiative: $100 Safe Drinking Water & Clean Up •Ask: $500 million •Initiative: $610 million Groundwater Management •Ask: $750 million •Initiative: $386.25 million Flood Protection •Ask: $950 million •Initiative: $660 million Water Conservation •Ask: $400 million •Initiative: $75 million 7 © 2021 Brownstein Hyatt Farber Schreck, LLP www.bhfs.com | 3. Recycled Water and Potable Reuse •On December 19, 2023, the State Water Resources Control Board approved regulations that allow water systems to develop treatment protocols to convert wastewater into high quality drinking water, known as direct potable reuse. •California’s Office of Administrative Law (OAL) approved OAL File No. 2024-0624-02S – the Direct Potable Reuse Regulations – and filed with the Secretary of State on August 6, 2024. The regulations took effect on October 1, 2024. •The rules require extensive treatment and monitoring with various steps designed to remove chemicals and pathogens that remain in sewage after it has already undergone traditional primary, secondary, and sometimes tertiary treatment. 8 © 2021 Brownstein Hyatt Farber Schreck, LLP www.bhfs.com | 4. Water Use and Efficiency •Making Conservation a Way of Life Regulations —On August 18th, 2023, the State Water Resources Control Board released regulations to establish water-use efficiency goals for urban retail water suppliers in compliance with the 2018 conservation legislation, Senate Bill 606 (Hertzberg) and Assembly Bill 1668 (Friedman). The regulation establishes unique efficiency goals for each supplier based on local conditions, leaving some flexibility to implement locally appropriate solutions. —In response to a critical Legislative Analyst Office report released in January calling the proposed regulations “costly and difficult to achieve,” Board staff proposed less stringent water-saving standards, reducing the number of suppliers required to achieve large cuts of more than 20%, and extending the timeline for water reductions an additional five years to 2040. The Board unanimously adopted the regulation on July 3, 2024, to take effect in 2025. —Under the regulation, urban retail water suppliers must comply with three major components: •An urban water use objective, a supplier-specific water budget that is the sum of water use efficiency standards applied to unique local characteristics (e.g., population, landscape area, etc.) •Commercial, industrial, and institutional (CII) performance measures •Annual reporting —ACWA worked with its members and coalition partners to secure extensive amendments that resulted in a more feasible and cost-effective regulation, including: •Changes to timelines for the outdoor water use standard and CII performance measures •Inclusion of feasible alternative compliance pathways •Modifications to compliance start date •Inclusion of 20% of suppliers’ irrigable, not irrigated area •Changes to processes requesting variances & temporary provisions, and the inclusion of a tree variance 9 © 2021 Brownstein Hyatt Farber Schreck, LLP www.bhfs.com | —Suppliers must work with their customers to achieve water savings to meet the new regulation, as individual customers are not required to comply with the urban water use objective. —Beginning Jan. 1, 2025, and by Jan. 1, every year thereafter, each urban retail water supplier is required to calculate its urban water use objective for the previous year. Each year, the objective will be based on dynamic data such as weather and population. Beginning Jan. 1, 2027, each urban retail water supplier must demonstrate compliance with its urban water use objective There were a number of bills introduced this session to delay implementation and reporting that failed to move forward but increased pressure on the Water Board to amend its proposed regulations: —SB 1330 (Archuleta) would have delayed the State Water Board’s authority to enforce the urban water use objective, deletes obsolete reporting requirements, requires DWR to study efficiency performance of certain classes of landscapes, requires LAO to complete another report on the implementation of the urban water use objective by January 10, 2029, and makes other changes to the urban water use objective statute. —AB 3121 (Hart) would have delayed by two years each the dates on which the State Water Board may begin issuing orders to enforce the urban water use objective and requires the LAO to report to the Legislature on implementation of the urban water use objective by January 10, 2028. —SB 1110 (Ashby) would have permitted the State Water Board to adopt a policy to guide its enforcement of urban water use objective regulations, delay enforcement of the objectives by two years, consolidate reporting on urban water use, and allow water agencies to report on a calendar or fiscal year basis. 10 © 2021 Brownstein Hyatt Farber Schreck, LLP www.bhfs.com | 5. Water Quality and Contaminants Maximum Contaminant Level Regulations —The State Water Board has the authority in statute to establish compliance periods for new MCLs. The State Water Board adopted a resolution for the adoption of drinking water regulations development during their March 7-8, 2023 workshop. —Chromium (hexavalent) Chrome 6 was first on that list. On April 17, the State Water Board adopted the Hexavalent Chromium (Cr(VI)) Maximum Contaminant Level of 0.010 milligrams per liter (mg/L) (or 10 parts per billion). The Regulation, which applies to all water suppliers, including small public water systems, was approved by the Office of Administrative Law on July 24, was filed with the California Secretary of State, and took effect on October 1, 2024. —PFOA & PFOS is next. On April 10, the U.S. Environmental Protection Agency announced a new national maximum contaminant level (MCL) of 4.0 parts per trillion (ppt) for PFOA and PFOS as individual contaminants and a standard of 10 ppt for three other chemicals — PFNA, PhDs, and HFPO-DA (referred to as GenXChemicals). This enforceable rule requires public water systems to monitor for these PFAS, notify the public of the levels of these PFAS, and reduce the levels of these PFAS in drinking water if they exceed the MCL. Utilities will have five years to come into compliance. ACWA considers these MCLs to be infeasible because the anticipated costs of complying are not adequately captured under EPA’s cost assessment. —The California Office of Environmental Health and Hazard Assessment on April 5 adopted public health goals of 0.007 ppt for PFOA and 1.0 ppt for PFOS. A public health goal is a drinking water objective that does not pose a significant health risk and is not enforceable but serves as the basis for development of MCLs. Division of Drinking Water (DDW) adopted MCL calendar for 2024 as follows: —a. Chromium (hexavalent) Adopted —b. Perfluoro-octanoic acid (PFOA) and perfluoro-octane sulfonic acid (PFOS) In Process —c. Arsenic —d. N-nitroso-dimethylamine (NDMA) —e. Styrene f. Cadmium and Mercury —g. Disinfection Byproducts 11 © 2021 Brownstein Hyatt Farber Schreck, LLP www.bhfs.com | Lead Testing Legislation: -Assemblyman Holden introduced AB 1851 this year as a pilot to address the Governor’s veto of his AB 249 from last year, which would have required, on or before January 1, 2027, a community water system that serves a school site receiving federal Title I funds to test for lead in each of the school site's potable water system outlets and to report the results to the SWB and applicable school site or LEA; would have required LEAs or school sites, if lead levels exceeded five ppb, to perform specified actions. -AB 1851 would require the Superintendent of Public Instruction (SPI) to provide grants to participating local educational agencies (LEAs) for testing drinking water lead levels, remediating lead in drinking water at eligible facilities, and contracting with a technical assistance (TA) provider. Bill failed in process. Cross Connection Control Policy Handbook -Final draft of the Cross Connection Control Policy Handbook was approved by the State Water Board on December 19. This handbook will replace portions of Title 17 that address cross-connection and backflow regulations. The District must provide a Cross Connection Control Plan to the board by July 1, 2025. District staff commented on portions of the handbook that will result in increased workload for the District and additional costs to customers. Specifically, that: -Residential Fire Sprinklers – The items required to remove the backflow requirement on residential homes with fire sprinklers would require the District to inspect homes (retroactively) to ensure specific plumbing materials are used, and a looped fire system is in place. District staff believes most homes will not be compliant, so it will require them to install backflow devices. About 3,200 homes are estimated to be affected by this. -Hazard Assessment on all sites – The District would have to perform hazard assessments on all its service connections as well as resurvey each time a commercial or multi-residential property changes ownership. Since the District requires the highest form of backflow protection for all commercial, multi-residential, and residential properties with wells on site, site surveys were done only as needed. District staff will now have to assess more than 50,000 services and create a process to resurvey commercial and multi-residential properties when ownership changes. 12 © 2021 Brownstein Hyatt Farber Schreck, LLP www.bhfs.com | 6. Advanced Clean Fleets Rulemaking Implementation •Executive Order N-79-20 accelerates the state’s transition to carbon neutrality by setting a course to end sales of internal combustion passenger vehicles by 2035. •The Advanced Clean Fleets proposed rulemaking for Public Fleets would require. —100% zero-emission drayage trucks by 2035. —100% zero-emission off-road vehicles and equipment by 2035, where feasible. —100% zero-emission medium and heavy-duty vehicles by 2045, where feasible. •Otay Water District submitted comments to CARB and met with CARB staff, seeking an exemption for emergency response vehicles. •CARB adopted the rule at April 27, 2023 workshop after 15 days of public comment. Otay WD submitted comments, and Brownstein policy advisor provided public comment. The Office of Administrative Law approved the rule on September 29, 2023, and it became official October 1, 2023. •AB 1594 (E. Garcia) was signed by the Governor last year to provide flexibility not present in the adopted regulations. (Otay submitted letters of support & a request for signature). —Requires any state regulation that seeks to require the procurement of medium- and heavy-duty ZEVs to authorize public agency utilities to purchase replacements for traditional utility-specialized vehicles that are at the end of life, as determined by CARB in consultation with public utility agencies, when needed to maintain reliable service and respond to major foreseeable events, including severe weather, wildfires, natural disasters, and physical attacks, without regard to the model year of the vehicle being replaced. —Authorizes a public agency utility to determine the daily usage of a medium- or heavy-duty vehicle to provide comprehensive usage data for a class of vehicles that does not exclusively rely on the lowest mileage reading and does not exclude the highest usage days. —Defines "public agency utility" as a local publicly owned electric utility, a community water system, a water district, and a wastewater treatment provider. 13 © 2021 Brownstein Hyatt Farber Schreck, LLP www.bhfs.com | The California Air Resources Board (CARB) hosted a second workshop on targeted amendments to the Advanced Clean Fleets (ACF) regulation that implements the requirements of Assembly Bill 1594 (Garcia, 2023). Proposed amendments to the Public Fleets provisions: -Definition added for “traditional utility-specialized vehicle” for public agencies (including Class 3-8 vehicles) to be applied to the ZEV Purchase Exemption and Daily Usage Exemption. -Specifies early access (less than 13 years to retire the vehicle) but does not yet say how long. -Added criteria of usage data by vehicle class (mileage and hours of operation thresholds) that provide you “early” access to the Daily Usage Exemption and ZEV Purchase Exemption. -According to ACWA staff, CARB has affirmed that the addition of Traditional Specialty Utility Vehicles definition and provisions entails that public fleets can avoid the 13-year requirement that applies to the ZEV Purchase Exemption and Daily Usage Exemption pathways by submitting a vehicle purchase plan OR demonstrate that your existing fleet vehicle exceeds the mileage/usage thresholds identified. ACWA was supportive of this. -CARB clarified in an unclear/unfavorable way, how they will review exemption requests made during 2024- 2026 as agencies contend with the 50% new purchase requirement. Internal Combustion Engine (ICE) vehicles listed in the Purchase List won’t be a separate category from 50/50 purchases. They will likely evaluate requests for an exemption based on an agency’s current vehicle purchases for the year and if any of their ICE purchases could have been made to purchase ZEVs. 14 Vehicle Class Mileage or Hour Threshold Class 3 and 4 70,000 miles Class 5 and 6 115,000 miles Class 7 and 8 175,000 miles Trucks with power take off device 4,000 hours © 2021 Brownstein Hyatt Farber Schreck, LLP www.bhfs.com | 7. Drought & Extreme Weather Response •On March 24, 2023, the Governor issued an executive order amending the Emergency Drought Proclamation and previous executive orders on conservation. —Ended the voluntary 15% water conservation target, —Ended requirement that local water agencies implement level 2 of their drought contingency plans, —Retained a state of emergency for all 58 counties to allow for drought response and recovery efforts, —Retained the non-functional turf irrigation ban in commercial, industrial, and institutional areas, including HOA common, set to expire in June 2024 unless the Board takes further action. —Emergency Regulation to Prohibit Wasteful Water Uses (refilling fountains without recirculating pumps, overwatering landscapes, watering grass within 48 hours of rainfall, etc.) expired in December 2023. •September 2024 - Governor terminated drought state of emergency in 19 counties where conditions improved significantly, maintaining it in remaining 39 counties to address continued impacts to local water supplies and facilitate ongoing recovery. 19 counties include: Imperial, Inyo, Los Angeles, Marin, Mendocino, Mono, Monterey, Orange, Riverside, San Bernardino, San Diego, San Francisco, San Luis Obispo, San Mateo, Santa Barbara, Santa Clara, Santa Cruz, Sonoma, and Ventura counties. 15 © 2021 Brownstein Hyatt Farber Schreck, LLP www.bhfs.com | •Governor Newsom’s California’s Water Supply Strategy —Water Supply Strategy announced August 2022 due to hotter and drier weather conditions (spurred by climate change) potentially reducing California’s water supply by up to 10% by 2040. —To help make up for the water supplies California could lose over the next two decades, the strategy prioritizes actions to capture, recycle, de-salt and conserve more water. •Create storage space for up to 4 million acre-feet of water. •Recycle and reuse at least 800,000 acre-feet of water per year by 2030. •Free up 500,000 acre-feet of water for new purposes each year. •Make new water available for use by capturing stormwater and desalinating ocean water and salty water in groundwater basins. —One year Progress Report released in October 2023 highlights actions taken by the administration over the last year in pursuit of these goals. (Groundwater recharge permitting, rehabilitating dams, expanding desal, Direct Potable Reuse Regulations, etc). 16 © 2021 Brownstein Hyatt Farber Schreck, LLP www.bhfs.com | 8. State Budget Funding Last year’s adopted budget faced a close to $32 billion budget deficit and included funding for a variety of water issues. According to the State Analyst Office, this year’s budget deficit is $58 billion based on revenue projections during the Governor’s Budget proposal in January. Later revenue numbers brought that estimate closer to $73 billion. Such a significant budget problem made any additional spending difficult. The 2021 and 2022 Budget Acts committed $8.7 billion over multiple years to support drought resilience and response programs to avoid immediate impacts from extreme drought while advancing projects and programs that will improve the state’s resilience to future droughts and floods. The adopted budget maintains $6.7 billion of these investments over multiple years in programs and projects to bolster the capacity of communities and ecosystems to endure droughts and floods. The Budget includes $1.4 billion in General Fund reductions and $539.1 million in fund shifts across various programs. The Budget also includes $189.1 million in new one-time investments to support flood protection, levee repair, and restoration of the Salton Sea. The Budget includes a $123.9 million one-time General Fund to support critical flood safety efforts. These include, but are not limited to: -$33 million General Fund to support the state cost share of continuing U.S. Army Corps of Engineers projects, Urban Flood Risk Reduction projects that address flood risk reduction, and the associated state operations costs to implement the projects. -$31.3 million General Fund to support continuing multi-benefit flood risk reduction projects in the Central Valley. -$29.6 million General Fund to address storm damage at state Plan of Flood Control facilities and state- owned Delta lands for critical repairs associated with the 2023 storms. To address the projected budget shortfall, the Budget includes General Fund solutions to achieve a balanced budget. These include: -Watershed Climate Resilience Programs—A reversion of $88.4 million, a $298 million General Fund reduction over the next two years, and a shift of $15 million to GGRF in 2025-26 for various watershed climate resilience programs. The budget maintains $108 million previously allocated to these programs. 17 © 2021 Brownstein Hyatt Farber Schreck, LLP www.bhfs.com | -Drinking Water and Wastewater Infrastructure—A reversion of $97.6 million General Fund and a shift of $254.9 to GGRF in 2024-25 and 2025-26 for drinking water and wastewater infrastructure projects in disadvantaged communities. The budget maintains $1.6 billion previously allocated to these programs. -Water Recycling—A reversion of $185.9 million General Fund and a fund shift of $15 million GGRF in 2025- 26 for water recycling and groundwater cleanup. The budget maintains $336 million previously allocated to this program. -Water Storage—A reduction of $500 million General Fund in 2025-26 for water storage projects. -Per-and Polyfluoroalkyl Substances—A reversion of $100.7 million General Fund and reduction of $30 million in 2024-25 for Per-and Polyfluoroalkyl support. The budget maintains $24 million previously allocated to this program. -Dam Safety—A reversion of $50 million General Fund for dam safety investments. The Budget maintains $50 million previously allocated to this program. A significant win for the water community in the budget included the restoration of nearly $500 million for the Agreements to Support Healthy Rivers and Landscapes, formerly the Voluntary Agreements. The funding was previously rescinded in the main budget bill, AB 107 (Gabriel, D-Encino). ACWA, the Northern California Water Association, the State Water Contractors and more than 40 other organizations successfully advocated to maintain nearly all funding for the Agreements. 18 © 2021 Brownstein Hyatt Farber Schreck, LLP www.bhfs.com | 9. State Water Project/Delta Conveyance •State Water Project (SWP) —Each year, DWR makes an initial SWP allocation on December 1. Allocations are updated as snowpack and runoff information are assessed, with a final allocation typically determined in May or June. DWR announced its initial SWP allocation of 10% for 2024 on December 1, 2023. DWR announced a final increase in the State Water Project (SWP) water supply allocation forecast for 2024 on April 23 to 40%. It is important to note that last year’s allocations eventually reached 100% for the first time since 2006. •Delta Conveyance Project —On December 8, 2023, DWR released the Final Environmental Impact Report (EIR) and certified it a few weeks later, on December 21st. Following the certification, various environmental organizations filed suits in late January 2024. —On May 16, 2024, the Department of Water Resources (DWR) released a Benefit Cost Analysis of the Delta Conveyance Project (DCP). The analysis found that the DCP would create billions of dollars in benefits for communities across California, including reliable water supplies, climate change adaptation, earthquake preparedness, and improved water quality. —On June 20, 2024, the Sacramento County Superior Court stopped the California Department of Water Resources (DWR) from undertaking further geotechnical investigations implementing the Delta Conveyance Project (DCP) until DWR files a certification of consistency with the Delta Stewardship Council as required under the Sacramento-San Joaquin Delta Reform Act of 2009 (Delta Reform Act). —On August 1, 2024, the State Water Board released a Notice of Public Hearing Regarding the Delta Conveyance Project. The hearing on January 16, 2025, will address DWR’s water right change petitions to add new points of diversion and rediversion to the water rights associated with the State Water Project (SWP), whether to approve the petitions and if so, what terms and conditions to include in the amended permits. 19 © 2021 Brownstein Hyatt Farber Schreck, LLP www.bhfs.com | —DWR posted a draft certification of consistency for the 2024-2026 Proposed Geotechnical Activities proposed action at least 10 days prior to formal submission. This draft certification only concerns certain geotechnical activities related to data collection (cone penetration tests, soil borings, and water quality sampling within soil borings). Planning and design of geotechnical data collection from the 2024-2026 Proposed Geotechnical Activities will be important to inform the planning and design of the Delta Conveyance Project, as well as future discretionary permitting and funding decisions by DWR and other agencies. —DWR did not originally plan to submit a certification of consistency for these 2024-2026 Proposed Geotechnical Activities but is doing so now based on the direction from the Sacramento Superior Court’s ruling on June 20, 2024. —On September 17, the State Water Board released a Notice of Pre-Hearing Conference and Procedural Ruling for October 17 regarding DWR’s pending Petitions for Change of Water Rights Permits associated with the State Water Project. The prehearing conference will address DWR’s withdrawal of the petitions for water rights extension of time and request to amend the change petitions. The hearing officer anticipates issuing an amended notice and procedural ruling after the pre-hearing conference. •Sites Reservoir Project —In early November, the Governor announced he had certified the project under SB 149 (2023), which allows the Governor to certify qualifying infrastructure projects for judicial streamlining under the California Environmental Quality Act (CEQA). Courts must decide CEQA challenges to certified projects within 270 days to the extent feasible. —In mid-November, the Bureau of Reclamation and Sites Project Authority certified its final EIR and was approved to move forward. Conservation & environmental justice groups filed a suit on December 20th. —In June, A Yolo County judge quickly denied the suit to stop the project filed by the Friends of the River, Center for Biological Diversity, California Sportfishing Protection Alliance, California Water Impact Network, Save California Salmon, and Sierra Club. However, they appealed the decision in the Third Appellate District Court with Friends of the River v. Sites Project Authority —Sites Reservoir cleared another major hurdle after Governor Gavin Newsom had streamlined the project late last year, defeating a CEQA legal challenge on September 20, with an appellate court ruling building on a similar victory in the trial court. 20 © 2021 Brownstein Hyatt Farber Schreck, LLP www.bhfs.com | 10. Water Rights Modernization •Due to the extreme weather patterns and greater federal-level discussions on the Colorado River water rights, water rights topped the Legislature’s agenda last year. Several bills were introduced last year that collectively presented a fundamental change in California’s water rights system through a coordinated effort for a foundational change to how the water rights system is implemented and enforced. The remaining bills that were considered this session included: —AB 1337 (Wicks) gives the State Water Board authority to adopt sweeping curtailment regulations for water conservation purposes to prevent waste, unreasonable use, or unreasonable water diversion methods. Failed in legislative process. —AB 460 (Bauer-Kahan) would have authorized the State Water Board to issue an interim relief order on water rights. ACWA removed opposition due to amendments that removed problematic provisions related to regulatory and enforcement issues and instead raised the penalties for illegal diversions. Signed into law. •ACWA considered proposing its own water rights legislation as an alternative to the above-described legislation however, no agreement was reached by its membership. Instead, ACWA led a coalition in opposition to the above-described legislation. 21 © 2021 Brownstein Hyatt Farber Schreck, LLP www.bhfs.com | Miscellaneous Brownstein engaged in opposition SB 937 (Wiener), which amends the Mitigation Fee Act, which governs the collection of development related fees that pay for the costs to install infrastructure necessary to build new homes and other developments in livable, equitable, and thriving communities. SB 937 restricts the timely funding of infrastructure and services necessary to build new homes. The bill for certain developments, defers development related fees until the certificate of occupancy or its equivalent, while limiting exceptions to this rule. The Governor signed the bill into law over the objection of various public agency associations. 22 Questions? Baltazar Cornejo bcornejo@bhfs.com (916) 594-9705 STAFF REPORT TYPE MEETING: Regular Board MEETING DATE: November 6, 2024 SUBMITTED BY: Charles Mederos, Utility Services Manager PROJECT: P2688 DIV. NO. All APPROVED BY: Andrew Jackson, Chief Water Operations Jose Martinez, General Manager SUBJECT: APPROVAL TO PURCHASE ONE REPLACEMENT STATIONARY EMERGENCY GENERATOR IN THE AMOUNT OF $149,000.00 FOR THE ADMINISTRATIVE BUILDING, INCREASE CAPITAL IMPROVEMENT PROJECT (CIP) P2688 FROM $76,000.00 TO $239,000.00 FOR FISCAL YEAR 2025, AND TO INCREASE THE OVERALL SIX-YEAR CIP FROM $833,000.00 TO $996,000.00 GENERAL MANAGER’S RECOMMENDATION: That the Board authorize the General Manager to issue a purchase order to Hawthorne CAT in the amount of $149,000.00 for the purchase of one replacement stationary emergency generator for the Administrative Building, declare existing generator as surplus, increase CIP P2688 from $76,000.00 to $239,000.00 for Fiscal Year 2025 and to increase the overall six-year CIP from $833,000.00 to $996,000.00. COMMITTEE ACTION: See “Attachment A.” PURPOSE: To obtain Board authorization to purchase one replacement stationary emergency generator for the Administrative Building, declare existing generator as surplus, increase CIP P2688 from $76,000.00 to $239,000.00 for Fiscal Year 2025, and to increase the overall six-year CIP from $833,000.00 to $996,000.00. AGENDA ITEM 9a ANALYSIS: The existing generator for the Administrative Building is a TIER 2 Volvo 602 horsepower engine and runs a 403kW/504kVA 480 3-phase generator. It is an emergency standby genset manufactured in 2004 by MQ Power (MQ). The District purchased this generator, in used condition, from Sloan electric on November 30, 2009, for $65,941.00 and it was installed in January 2010. In April 2017, the engine control panel failed with 172 hours of service on the meter. The panel was replaced with no further issues. In August 2024, during a routine monthly inspection, it was discovered that the control panel had unexpectedly failed again with the generator having 231.9 operating hours. Staff proceeded to bypass the stationary generator and installed a portable generator in the event of a planned or unplanned power outage. Staff contacted several nationwide service providers, including the manufacturer, in search of replacement options. On August 28, 2024, staff received confirmation from MQ that this generator was no longer supported by the manufacturer and there was no replacement engine controller available. The existing generator is classified as TIER 2 generator emission level. Therefore, in anticipation of this possible order and the generator being past its service life expectancy and there are no available parts for repairs, it must be replaced with a generator that is better in long term compliance and supported with current technology. The new generator will be a replacement in-kind and Tier 3 emission standards. The specified replacement stationary emergency generator is designed to operate as a backup power source in case of power outages, rolling blackouts, Public Safety Power Shutoffs, and Energy Conservation Activations at State or local level. The generator is critical to maintain critical infrastructure, including SCADA servers, in the Administrative Building. It is worth noting that Operations staff conducts annual testing on the District’s emergency generators, which includes, but is not limited to the following procedures: • Simulation of an actual loss of utility power. • Observation of proper start up, operation, and shutdown of the generator and associated Automatic Transfer Switch (ATS). • Ability to monitor and operate the facility locally and remotely via the District’s SCADA system. • Use of a “Load Bank” which places actual power demands on the generators to evaluate their performance (temperature, pressure, power output, etc.) when operating near rated capacities. • Additionally, exercising engines near their capacities is also part of the recommended maintenance for the generators. This testing is part of the ongoing efforts performed by staff to help ensure the District’s ability to have auxiliary power in the event of an emergency. Staff plans to purchase the generator through Sourcewell Cooperative Agreement with Caterpillar Inc., and received the following quote from Hawthorn Power Systems, Caterpillar Inc.’s authorized distributor. The price received includes all applicable fees, taxes, delivery, testing, and training. Dealer Price Hawthrone Power Systems $149,000 Note: Cooperative/Joint Purchases are authorized under Section 6.2.3 of the Purchasing Manual. These purchases are exempt from the District’s competitive solicitation requirements so long as the contracts, schedules, and agreements are solicited in a manner consistent with the District’s purchasing policies. Sourcewell is a national service cooperative created by the Minnesota legislature as a government agency, which performs cooperative purchasing on behalf of itself and its participating public agencies to reduce the cost of procurement. Participating agencies include all eligible government, education, and nonprofit agencies nationwide and in Canada. Sourcewell's solicitation process meets the District's competitive solicitation requirements. For Fiscal Year 2025, staff budgeted $76,000.00 for the replacement of the 1200-1 Pump Station’s generator under CIP P2688. The Board of Directors authorized the purchase and replacement of the 1200- 1 emergency standby generator at the Board meeting held on August 7, 2024. However, the Administrative Building emergency standby generator controller and related equipment failed unexpectedly, as previously mentioned. The temporary portable emergency generator currently in place and has a San Diego Air Pollution Control District (APCD) stationary time limitations of a maximum period of 12 months. CIP P2688 Standby Power Renovations has a six-year expenditure schedule of $833,000.00, which includes a projected expenditure amount of $200,000.00 for Fiscal Year 2030 for the replacement of either the Administrative or Operations Building emergency standby generator. Staff requests to increase the overall six-year CIP from $833,000.00 to $996,000.00 to cover the future purchase of the Operations Building emergency standby generator. At the time the CIP budget was prepared, Operations staff had only projected the purchase of the emergency standby generator for either the Administrative Building or Operations Building, but not both buildings. Based on a recent assessment, Operations staff foresee that both will need to be replaced. The increased CIP amount for Fiscal Year 2025 will also cover approximately $14,000.00 in expenses to the District’s as-needed electrical engineering firm “Engineering Partners, Inc” (EPI) for their electrical assessment to replace the Administrative Building emergency generator. Since the District requires reliable equipment for emergency response, staff recommends that the Board authorize the General Manager to: • Pull funds from Fiscal Year 2030 and increase CIP P2688 from $76,000.00 to $239,000.00 for Fiscal Year 2025. • Increase six-year CIP P2688 from $833,000.00 to $996,000.00 for future replacement of the Operations building generator. • Issue a purchase order to Hawthorne CAT for the purchase of the replacement of the emergency standby generator for the Administrative Building. • Declare the existing generator as surplus. FISCAL IMPACT: Joe Beachem, Chief Financial Officer Projected purchase cost for one emergency standby generator for the Administrative Building is $149,000.00 plus an additional $14,000.00 in consulting and assessment costs, which will be charged against CIP P2688. The total cost in this account will exceed budgeted funding. The total Fiscal Year 2025 project budget for CIP P2688 is $76,000.00. Staff is requesting to pull funds from Fiscal year 2030 projected purchase to replace the emergency standby generator for the Administrative building to cover for this expense and to increase the overall six-year CIP from $833,000.00 to $996,000.00 for future projected replacement of an emergency standby generator. The Finance Department has determined that, under the current rate model, an additional $163,000 in debt will be issued to offset the requested increase in the six-year CIP budget. The additional debt is projected to increase in Fiscal Year 2027 rates by less than 0.1%. The rate impact of pulling the requested amount for Fiscal Year 2025 of approximately 0.01%. The Finance Department has determined that 100% of the funds are available to cover the cost of the replacement emergency standby generator for the Administrative Building. Expenditure Summary: CIP P2688 Current six-year Expenditures $833,000.00 Requested Overall six-year Increase To Cover Future Replacement of the Operations Building Emergency Standby Generator $996,000.00 Proposed cost for Administrative Building Emergency Standby Generator Replacement $149,000.00 As-Needed Electrical Engineering Assessment $14,000.00 Total, Projected Expenditures of Equipment Replacements Fiscal Year 2025 CIP P2688 $163,000.00 STRATEGIC GOAL: Operate the system to meet demand twenty-four hours a day, seven days a week. LEGAL IMPACT: None Attachments: Attachment A – Committee Action Attachment B – Photos Exhibit A – Project Location ATTACHMENT A SUBJECT/PROJECT: APPROVAL TO PURCHASE ONE REPLACEMENT STATIONARY EMERGENCY GENERATOR IN THE AMOUNT OF $149,000.00 FOR THE ADMINISTRATIVE BUILDING, INCREASE CAPITAL IMPROVEMENT PROJECT (CIP) P2688 FROM $76,000.00 TO $239,000.00 FOR FISCAL YEAR 2025, AND TO INCREASE THE OVERALL SIX-YEAR CIP FROM $833,000.00 TO $996,000.00 COMMITTEE ACTION: The Finance and Administration Committee reviewed this item at a meeting held on October 16, 2024, and the following comments were made: • The Committee inquired about the salvage value of the existing standby generator. Staff stated that it is valued at approximately $2,500-$5,000. • In response to a question from the Committee, staff stated that the existing standby generator detected a failure in 2017 which the engine control panel had failed. It had 172 hours of service on the meter. No further issues were detected until August of this year. It was noted that the existing generator was installed in 2009; therefore, there is no warranty at this time. • The committee inquired if the data on generator usage is available for review at any time. Staff stated yes as it is required to provide data to the County of San Diego Air Pollution Control District on an annual basis. Following the discussion, the Committee supported staff’s recommendation and presentation to the full board as a consent item. Attachment B OTAY WATER DISTRICTOWD ADMINISTRATION BLDGELECTRIC GENERATOR REPLACEMENT EXHIBIT AC:\OneDrive Work\Otay Water District\OWD SHARED - Documents\Asset Management\_Projects\2024-09-19 Admin Bldg Generator\Exhibit A, Location Map, Admin Bldg Generator Replacement.mxd VICINITY MAP PROJECT SITE DIV 5 DIV 1 DIV 2 DIV 4 DIV 3 ÃÅ54 !\ ÃÅ125 ÃÅ94 ÃÅ905 §¨¦805 FNTS PROJECT SITE SEP 2024F 0 7035 Feet SWEETW ATER SPRINGS BLVD OWD Admin Bldg !\ STAFF REPORT TYPE MEETING: Regular Board MEETING DATE: November 6, 2024 SUBMITTED BY: Brandon DiPietro Field Services Manager PROJECT NO./ SUBPROJECT: Various DIV. NO. ALL APPROVED BY: ☒ Kevin Cameron, Engineering Manger ☒Michael Long, Chief, Engineering ☒Jose Martinez, General Manager SUBJECT: Award a Professional Services Contract for As-Needed Plan Checking and Recycled Water Inspection Services for Fiscal Years 2025 through 2027 GENERAL MANAGER’S RECOMMENDATION: That the Otay Water District (District) Board of Directors (Board) award a Professional Services contract for As-Needed Plan Checking and Recycled Water Inspection Services to West Yost & Associates, Inc. (West Yost) and to authorize the General Manager to execute an agreement with West Yost in an amount not-to-exceed $850,000 for Fiscal Years 2025-2027 (ending June 30, 2027). COMMITTEE ACTION: Please see Attachment A. PURPOSE: To obtain Board authorization for the General Manager to enter into a professional services contract for As-Needed Plan Checking and Recycled Water Inspection Services with West Yost in an amount not-to-exceed $850,000 for Fiscal Years 2025-2027. AGENDA ITEM 9b 2 ANALYSIS: The District will require the services of an engineering consulting firm to provide As-Needed Plan Checking and Recycled Inspection Services in support of developer potable and recycled water projects and District services. The consultant assists the Public Services and Field Services Sections of the Engineering Department in performing plan check reviews for developer projects and recycled water site inspections. The plan checking services require the consultant to be a registered Civil Engineer (Project Manager) familiar with the District’s standards and procedures. The Project Manager will provide quality control for all plan reviews and recycled water site inspections. Services the consultant will perform are as follows: perform plan review activities necessary to evaluate general compliance with the District, San Diego Water Agencies’ Standards (SDWAS), Department of Environmental Health and Quality (DEHQ), and Division of Drinking Water (DDW) standards, as required for each plan received. The consultant will coordinate approval with the District, DEHQ, DDW, and developers, as required. The consultant will deliver the reviewed recycled water plan(s) to DEHQ for their evaluation and approval. The consultant will provide inspection for sites under construction along with annual and quadrennial testing and certification. The consultant will provide input on the District’s Cross Connection Control Plan. It is anticipated that the consultant will review approximately eighty (80) projects or more during the contract period. Over the same period, staff estimates the cost to perform this responsibility will not exceed $850,000. Since these services are as needed, the full amount of this contract may not be expended. On August 21, 2024, the District solicited for As-Needed Plan Checking and Recycled Water Inspection Services by placing an advertisement on the District’s website, on PlanetBids, and in the San Diego Daily Transcript. Two (2) firms submitted a letter of interest and a statement of qualifications. The Request for Proposal (RFP) for As-Needed Plan Checking and Recycled Water Inspection Services was sent to the two (2) firms, resulting in two (2) proposals received by Friday, September 6, 2024, from the following firms: • Bureau Veritas North America, Inc., San Diego, CA • West Yost & Associates, Inc., San Diego, CA 3 The two (2) submitted proposals were found to be responsive with respect to the District’s requirements. In accordance with the District’s Policy 21, staff evaluated and scored the written proposals of the two (2) firms on Tuesday, October 1, 2024. On October 2, 2024, the District conducted interviews via Microsoft Teams videoconferencing with the two (2) firms. The District has chosen to utilize one consultant for this contract due to the volume of plan checks and inspections expected. West Yost received the highest score for their services based on their experience, understanding of the scope of work, and proposed method to accomplish the work. West Yost was the most qualified, with the best overall rating or ranking. A summary of the complete evaluation is shown in Attachment B. West Yost submitted the Company Background Questionnaire, as required by the RFP, and staff did not find any significant issues. Staff checked their references and performed an internet search on the company. Staff found the references to be excellent and did not find any outstanding issues with the internet search. West Yost’s project manager, listed in the proposal, has vast plan checking and project management experience. The District has historically utilized professional As-needed services to support the delivery of private developers’ potable and recycled water projects and to assist the District in staff augmentation when needed. FISCAL IMPACT: ☒ Joe Beachem, Chief Financial Officer Plan check, inspection, and project management services are an on-going effort provided by the District’s Public Services Section in support of District and developer projects. This expense is completely funded by developer deposits and does not affect the District’s operating budget. Use of as-needed services will also be used to assist District staff with drafting the Cross-Connection Handbook and to supplement District staff due to staff vacancies. Funds for assisting with the drafting of the Cross-Connection Handbook are included in the FY 2025 operating budget. The funding for supplementing District staff will be offset by labor vacancy savings. 4 STRATEGIC GOAL: This Project supports the District’s Mission statement, “To provide exceptional water and wastewater service to its customers, and to manage District resources in a transparent and fiscally responsible manner” and the General Manager’s Vision, "To be a model water agency by providing stellar service, achieving measurable results, and continuously improving operational practices.” GRANTS/LOANS: Not applicable. LEGAL IMPACT: None. BD/KC:jf Attachments: Attachment A – Committee Action Attachment B – Summary of Proposal Rankings ATTACHMENT A SUBJECT/PROJECT: Various Award a Professional Services Contract for As-Needed Plan Checking and Recycled Water Inspection Services for Fiscal Years 2025 through 2027 COMMITTEE ACTION: The Engineering, Operations, and Water Resources Committee (Committee) reviewed this item at a meeting held on October 16, 2024, and the following comments were made: • Staff recommended that the Board award a Professional Services contract for As-Needed Plan Checking and Recycled Water Inspection Services to West Yost & Associates, Inc. (West Yost) and to authorize the General Manager to execute an agreement with West Yost in an amount not-to-exceed $850,000 for Fiscal Years 2025-2027 (ending June 30, 2027). • In response to a question from the Committee, staff stated that with this particular contract where there’s a specialized inspection component for recycled water sites, it limits the number of available consultants that are qualified to perform the scope of work. • Staff stated that Planet Bids is the portal of choice for Request for Proposals as it provides qualified and reliable consultants. It was also noted that staff attend Construction Network meetings and events to disclose upcoming project contracts. Following the discussion, the Committee supported staff’s recommendation and presentation to the full board as a consent item. Qualifications of Team Responsiveness and Project Understand Technical and Management INDIVIDUAL SUBTOTAL - WRITTEN AVERAGE SUBTOTAL - WRITTEN Consultant's Commitment to DBE Additional Creativity and Insight Strength of Project Manager Presentation and Communication Skills Responses to Questions INDIVIDUAL TOTAL - ORAL AVERAGE TOTAL ORAL Proposed Rates*Total Score 30 25 30 85 85 Y/N 15 15 10 10 50 50 15 150 Poor/Good/ Excellent Mike O'Donnell 27 23 28 78 13 14 8 9 44 Lito Santos 28 23 27 78 14 14 9 10 47 Marciano Santos 28 23 27 78 14 14 9 10 47 Brandon DiPietro 28 23 26 77 13 14 9 9 45 Aaron Hazard 25 22 25 72 12 12 7 8 39 Mike O'Donnell 24 20 25 69 8 10 5 6 29 Lito Santos 22 18 23 63 11 11 7 7 35 Marciano Santos 26 20 25 71 12 12 7 8 39 Brandon DiPietro 26 20 22 68 10 10 7 6 33 Aaron Hazard 20 18 25 63 10 10 5 5 30 Consultant Weighted Rate Score West Yost $202 1 *The fees were evaluated by comparing the weighted rates for six positions. The sum of the weighted rates are noted on the Rates Scoring Chart. Bureau Veritas $149 15 Note: Review Panel does not see or consider rates when scoring other categories. Rates are scored by a staff member who is not on the Review Panel. REFERENCES Y 44 122 ORALWRITTEN Excellent77 SUMMARY OF PROPOSAL RANKINGSATTACHMENT B As-Needed Plan Check Services for Developer Potable and Recycled Water Projects - Fiscal Years 2025 and 2027 15 RATES SCORING CHART Bureau Veritas 67 Y 33 115 West Yost MAXIMUM POINTS 1 STAFF REPORT TYPE MEETING: Regular Board MEETING DATE: November 6, 2024 SUBMITTED BY: Lito Santos Senior Civil Engineer PROJECT: P2567-001103 P2631-001103 DIV. NO. 3 & 5 APPROVED BY: Beth Gentry, Engineering Manager Michael Long, Chief, Engineering Jose Martinez, General Manager SUBJECT: Approval to Increase the CIP P2631 Budget in an Amount of $174,500 and Award of a Construction Contract to Unified Field Services Corporation (UFSC) for the 1004-2 & 1485-2 Reservoir Interior/Exterior Coating & Upgrades Projects (P2567 and P2631) GENERAL MANAGER’S RECOMMENDATION: That the Otay Water District (District) Board of Directors (Board): 1. Approve to increase the CIP P2631 budget by $174,500 (from$1,450,000 to $1,624,500); and 2. Award a construction contract to Unified Field ServicesCorporation (UFSC) and authorize the General Manager to execute an agreement with UFSC for the 1004-2 & 1485-2Reservoir Interior/Exterior Coating & Upgrades Project in anamount not-to-exceed $1,304,694 (P2567 and P2631) (see Exhibits A-1 and A-2 for Project location). COMMITTEE ACTION: Please see Attachment A. PURPOSE: To increase the overall CIP P2631 budget in the amount of $174,500 (from $1,450,000 to $1,624,500) and to obtain Board authorization for the General Manager to enter a construction contract with UFSC for the 1004-2 & 1485-2 Reservoir Interior/Exterior Coating & Upgrades Project in an amount not-to-exceed $1,304,694. AGENDA ITEM 9c 2 ANALYSIS: The 1004-2 Reservoir was originally constructed in 2004, and the interior and exterior coating and upgrades project was accepted in January 2024. After acceptance, the new safety climb bottom bracket was in conflict with the anti-climb door. Included in this work is the replacement of the 1004-2 Reservoir door hinge to extend the door sweep radius of the existing anti-climb door to clear the safety climb bottom bracket. The 1485-2 Reservoir is a 1.6 million-gallon (MG) potable water storage facility that serves portions of Jamul. The 1485-2 Reservoir was originally constructed in 2006 and has never been recoated. It is one of two storage facilities in the 1485 Pressure Zone. Service in the 1485 Zone, during the project, will be maintained by the 1485-1 Reservoir. The District’s corrosion consultant maintains a Corrosion Control Program (CCP) that addresses the installation, maintenance, and monitoring of the corrosion protection systems for the District’s steel reservoirs and buried metallic piping. The CCP includes a reservoir maintenance schedule that shows the 1485-2 Reservoir is due for recoating on both the interior and exterior surfaces. An in-service internal and external inspection was performed by CSI Services, Inc., which illustrates the exterior coating is in fair condition, with areas of topcoat peeling and significantly weathering from chalking at the roof and shell. The interior inspection was in fair condition with rust defects mainly in the mechanical connections. The interior inspection report stated the Reservoir showed blisters and delamination on the tank floor and on the shell throughout the interior of the tank. In addition to the interior and exterior coating removal and replacement, the recommended structural and safety upgrades are as follows: replace the roof vent, install new D-rings and safety cable lanyards for roof access, replace the exterior ladder safety climb with extension bar, replace the razor wire on exterior latter, replace tank penetrations, replace the existing level indicator, replace interior rafters, replace seismic rods, replace cathodic anode handhole ports, replace cathodic anodes, replace cathodic reference cells, replace cathodic test box and wiring, install an OSHA compliant gate, and various other structural modifications. These upgrades will ensure compliance with the American Water Works Association (AWWA) and the Occupational Safety and Health Administration Standards for both federal (OSHA) and state (Cal-OSHA), as well as upgrade antiquated equipment on the tank. The Project was advertised on August 30, 2024, using the District’s online bid solicitation website, PlanetBids, on the Otay Water 3 District’s website, and in the Daily Transcript. Additionally, notifications of the Project being out for bid were emailed directly to fifty (50) contractors and plan rooms that previously worked for the District or local agencies conducting similar work. This is in addition to the notifications provided by PlanetBids to contractors in the Southern California area, with several hundred identified for the project classifications checked for this Project. PlanetBids provided electronic distribution of the Bid Documents, including specifications, plans, and addenda. An online Zoom Pre-Bid Meeting was held on September 17, 2024, which was attended by seven (7) contractors and vendors. Site visits were made available to the contractors on September 18, September 19, and September 24, 2024. Three (3) addenda were sent out to all bidders and plan houses to address questions and clarifications to the contract documents during the bidding period. The bids were publicly opened on-line via a Zoom meeting on October 3, 2024, with the following result: CONTRACTOR TOTAL BID AMOUNT 1 Unified Field Services Corporation Bakersfield, CA $1,304,694 2 Advanced Industrial Services, Inc Los Alamitos, CA $1,416,500 3 Paso Robles Tank, Inc. Hemet, CA $1,469,587 The Engineer's Estimate is $925,000. Unit costs were calculated from previous coating projects with bid escalation. The increase in unit prices received from all three (3) bidders was overall larger than the Engineer’s unit price forecast. A review of the bids was performed by District staff for conformance with the contract requirements and it was determined that UFSC was a responsive and responsible bidder. UFSC holds a Class A Contractor’s License in the State of California, which meets the contract document’s requirements and is valid through December 31, 2025. UFSC also holds a current QP-1 required certification from the Association for Materials Protection and Performance. UFSC submitted the Company Background and Company Safety Questionnaire, as required by the contract documents. The reference checks indicated a good to excellent performance record on similar projects. An internet background search of the company was performed and revealed no outstanding issues with this company. The proposed Project Manager has experience in California on similar projects and received excellent recommendations. UFSC has previously worked with the District on the 1004-2 and 485-1 Reservoir Tank Coating projects, which were completed on time and on budget. 4 Staff verified that the bid bond provided by Nationwide Mutual Insurance Company is valid. Upon Board approval, Unified Field Services Corporation will sign the contract, furnish the performance bond and labor and materials bond, and staff will verify both bonds prior to fully executing the contract. FISCAL IMPACT: Joe Beachem, Chief Financial Officer The total budget for 1004-2 Reservoir Interior/Exterior Coating CIP P2567, as approved in the FY 2025 budget, is $1,375,000. Total expenditures, plus outstanding commitments and forecast, including this contract, are $1,362,718. Based on the Project Manager's review of the financial budget of P2567 is sufficient to support the Project. See Attachment B-1 for the budget detail. The total budget for 1485-2 Reservoir Interior/Exterior Coating CIP P2631, as approved in the FY 2025 budget, is $1,450,000. Total expenditures, plus outstanding commitments, and forecast, including this contract, are $1,624,500. The Project Manager anticipates that with a budget increase of $174,500, the CIP P2631 portion of the Project will be completed within the new budget amount of $1,624,500. See Attachment B-2 for the budget detail. The Finance Department has determined that, under the current rate model, an additional $174,500 in debt will be issued to fund the requested budget increase for the CIP P2631 project. The additional debt is projected to have a 0.01% rate impact on the FY 2026 rates. GRANTS/LOANS: Engineering staff researched and explored grants and loans and found none were available for this Project. STRATEGIC GOAL: This Project supports the District’s Mission statement, “To provide exceptional water and wastewater service to its customers, and to manage District resources in a transparent and fiscally responsible manner” and the General Manager’s Vision, "To be a model water agency by providing stellar service, achieving measurable results, and continuously improving operational practices." 5 LEGAL IMPACT: None. LS/BG:jf Attachments: Attachment A – Committee Action Attachment B-1 – Budget Detail – CIP P2567 Attachment B-2 – Budget Detail – CIP P2631 Exhibit A-1 – Project Location for 1004-2 Reservoir Exhibit A-2 – Project Location for 1485-2 Reservoir ATTACHMENT A SUBJECT/PROJECT: P2567-001103 P2631-001103 Approval to Increase the CIP P2631 Budget in an Amount of $174,500 and Award of a Construction Contract to Unified Field Services Corporation (UFSC) for the 1004-2 & 1485-2 Reservoir Interior/Exterior Coating & Upgrades Projects (P2567 and P2631) COMMITTEE ACTION: The Engineering, Operations, and Water Resources Committee (Committee) reviewed this item at a meeting held on October 16, 2024, and the following comments were made: • Staff recommended that the Board of Directors: o Approve to increase the CIP P2631 budget by $174,500 (from $1,450,000 to $1,624,500); and o Award a construction contract to Unified Field Services Corporation (UFSC) and authorize the General Manager to execute an agreement with UFSC for the 1004-2 & 1485-2 Reservoir Interior/Exterior Coating & Upgrades Project in an amount not-to-exceed $1,304,694 (P2567 and P2631) (see Exhibits A-1 and A-2 for Project location). • In response to a question from the Committee, staff stated that the overall increase to the budget was due to the bids that were submitted. • As stated in the staff report, United Field Services Corporation has previously worked with the district, and they completed the project on time and on budget. Following the discussion, the Committee supported staff’s recommendation and presentation to the full board as a consent item. ATTACHMENT B-1 – Budget Detail for P2567 SUBJECT/PROJECT: P2567-001103 P2631-001103 Approval to Increase the CIP P2631 Budget in an Amount of $174,500 and Award of a Construction Contract to Unified Field Services Corporation (UFSC) for the 1004-2 & 1485-2 Reservoir Interior/Exterior Coating & Upgrades Projects (P2567 and P2631) 10/3/2024 Budget 1,375,000 Planning Standard Salaries 39,675 39,675 - 39,675 Service Contracts 7,950 7,950 - 7,950 CSI SERVICES 50 50 PETTY CASH Total Planning 47,675 47,675 - 47,675 Design Standard Salaries 73,978 73,978 - 73,978 Service Contracts 47 47 0 47 DAILY JOURNAL CORPORATION Total Design 74,025 74,025 0 74,025 Construction Standard Salaries 122,383 122,383 - 122,383 Construction Contract 5,500 - 5,500 5,500 UNIFIED FIELD SERVICES CORP Construction Contracts 912,717 912,717 - 912,717 UNIFIED FIELD SERVICES CORP 18,810 18,810 - 18,810 ALYSON CONSULTING 250 250 - 250 CLARKSON LAB & SUPPLY INC 88,310 88,310 - 88,310 CSI SERVICES INC 548 548 - 548 NINYO & MOORE GEOTECHNICAL Infastructure Equipment & Materials 564 564 - 564 SUPERIOR READY MIX LP Security Services 20,000 - 20,000 20,000 WATCHLIGHT CORPORATION Service Contracts 582 582 - 582 ABC IMAGING 12,135 12,135 - 12,135 BARRETT ENGINEERED PUMPS 19,669 19,669 - 19,669 DAWSON COMPANY 27,724 27,724 - 27,724 FERGUSON ENTERPRISES INC #1083 3,897 3,897 - 3,897 FERGUSON WATERWORKS # 1083 301 301 - 301 GRAINGER INC 3,838 3,838 - 3,838 LINDE GAS & EQUIP 1,107 1,107 - 1,107 MCMASTER-CARR SUPPLY CO 2,682 2,682 - 2,682 SOUTHLAND PIPE CORP Total Construction 1,241,018 1,215,518 25,500 1,241,018 Grand Total 1,362,718 1,337,218 25,500 1,362,718 Consultant Contracts Supplier Contracts Vendor/Comments Otay Water District P2567 - 1004-2 Reservoir Interior/Exterior Coating Committed Expenditures Outstanding Commitment & Forecast Projected Final Cost ATTACHMENT B-2 – Budget Detail for P2631 SUBJECT/PROJECT: P2567-001103 P2631-001103 Approval to Increase the CIP P2631 Budget in an Amount of $174,500 and Award of a Construction Contract to Unified Field Services Corporation (UFSC) for the 1004-2 & 1485-2 Reservoir Interior/Exterior Coating & Upgrades Projects (P2567 and P2631) 10/3/2024 Budget $ 1,450,000 Planning Standard Salaries 3,108 3,108 - 3,108 Service Contracts 3,975 3,975 - 3,975 CSI SERVICES - Total Planning 7,083 7,083 - 7,083 Design Standard Salaries 62,558 62,558 - 62,558 Total Design 62,558 62,558 - 62,558 Construction Standard Salaries 95,089 - 95,089 95,089 Construction Contract 1,299,194 - 1,299,194 1,299,194 UNIFIED FIELD SERVICES CORPORATION Service Contracts 35,000 - 35,000 35,000 CONSTRUCTION MANAGEMENT 58,000 - 58,000 58,000 COATING INSPECTION 5,000 - 5,000 5,000 WELDING INSPECTION 12,000 - 12,000 12,000 WATCHLIGHT 1,750 - 1,750 1,750 STRUCTURAL ENGINEER 1,250 - 1,250 1,250 CLARKSON LABORATORY Infrastrucutre Equipment & Materials 8,600 - 8,600 8,600 OT ELECTRICAL Project Contingency 38,976 - 38,976 38,976 3% CONTINGENCY Total Construction 1,554,859 - 1,554,859 1,554,859 Grand Total 1,624,500 69,641 1,554,859 1,624,500 Vendor/Comments Otay Water District P2631 - 1485-2 Reservoir Interior/Exterior Coating and Upgrades Committed Expenditures Outstanding Commitment & Forecast Projected Final Cost OTAY WATER DISTRICT1004-2 RESERVOIR INT/EXT COATING & UPGRADES LOCATION MAP EXHIBIT A-1 C: \ U s e r s \ d o n a l d . b i e n v e n u e \ O t a y W a t e r D i s t r i c t \ E N G C I P - D o c u m e n t s \ P 2 5 6 7 1 0 0 4 - 2 R e s e r v o i r I n t - E x C o a t i n g & U p g r a d e s \ G r a p h i c s \ E x h i b i t s - F i g u r e s \ E x h i b i t A . m x d !\ VICINITY MAP PROJECT SITE DIV 5 DIV 1 DIV 2 DIV 4 DIV 3 ÃÅ54 ÃÅ125 ÃÅ94 ÃÅ905 §¨¦805 FNTS PROJECT SITE CIP P2567F 0 450225 Feet EUCALYPTUS ST IVY ST BU E N A V I S T A A V E LA P R E S A A V E ACCE S S R D Skyline Truck Trl Lyon s V a l l e y R d Ch a p a r r a l H e i g h t s R d L o m a E s t a t e s C t §¨¦805 ÃÅ125 ÃÅ94 ÃÅ905 VICINITY MAP PROJECT SITE DIV 5 DIV 1 DIV 2 DIV 4 DIV 3 ÃÅ54 !\ 0 500250 Feet CIP P2631 F EXHIBIT A-2 1485-2 RESERVOIR INTERIOR/EXTERIORCOATING & UPGRADES OTAY WATER DISTRICT C: \ U s e r s \ o r e a d y \ O t a y W a t e r D i s t r i c t \ E N G C I P - D o c u m e n t s \ P 2 6 3 1 1 4 8 5 - 2 R e s e r v o i r - I n t e r i o r - E x t e r i o r C o a t i n g \ G r a p h i c s \ E x h i b i t s - F i g u r e s \ E x h i b i t A - P 2 6 3 1 . a p r x F NTS 1485-2 RESERVOIR PROJECT SITE STAFF REPORT TYPE MEETING: Regular Board MEETING DATE: November 6, 2024 SUBMITTED BY: Kevin Cameron Engineering Manager PROJECT: Various DIV. NO. All APPROVED BY: Michael Long, Chief, Engineering Jose Martinez, General Manager SUBJECT: Award of Two (2) Professional Services Contracts for As-Needed Engineering Design Services to NV5, Inc. and Wood Rodgers, Inc. for Fiscal Years 2025-2027 GENERAL MANAGER’S RECOMMENDATION: That the Otay Water District (District) Board of Directors (Board) award two (2) professional service contracts for As-Needed Engineering Design Services and to authorize the General Manager to execute two agreements with NV5, Inc. (NV5) and Wood Rodgers, Inc. (Wood Rodgers), each in an amount not-to-exceed $800,000. The total amount of the two (2) contracts will not exceed $800,000 during Fiscal Years 2025-2027 (ending June 30, 2027). COMMITTEE ACTION: Please see Attachment A. PURPOSE: To obtain Board authorization for the General Manager to enter into two (2) professional services contracts for As-Needed Engineering Design Services with NV5 and Wood Rodgers, with each contract in an amount not-to-exceed $800,000 for Fiscal Years 2025-2027. The total amount of the two (2) contracts will not exceed $800,000 during Fiscal Years 2025-2027. AGENDA ITEM 9d 2 ANALYSIS: The District will require the services of two (2) professional engineering design consultants on an as-needed basis in support of Capital Improvement Program (CIP) projects for Fiscal Years 2025-2027. It is more efficient and cost effective to issue as-needed contracts for engineering design, which will provide the District with the ability to obtain consulting services in a timely and efficient manner. This concept has also been used in the past for engineering design and other disciplines, such as construction management, geotechnical, electrical, and environmental services. District staff will identify tasks and request cost proposals from the two (2) consultants during the contract period. Each consultant will prepare a detailed scope of work, schedule, and fee for each task order, with the District evaluating the proposals based upon qualifications and cost. The District will enter into negotiations with the consultants, selecting the proposal that has the best value for the District. Upon written task order authorization from the District, the selected consultant shall then proceed with the project, as described in the scope of work. The CIP projects anticipated to require as-needed engineering design services for Fiscal Years 2025-2027 at this time are listed below: CIP DESCRIPTION ESTIMATED COST P2460 I.D. 7 Trestle and Pipeline Demolition $100,000 P2630 624-3 Reservoir Automation of Chemical Feed System (w/ P2710) $110,000 P2674 System Pressure Reducing Program $30,000 P2685 980/711 PRS Renovation - Proctor Valley Rd $130,000 P2687 PL - Steele Canyon Rd Bridge 803 PZ 20-inch WL Renovation $90,000 P2710 Conversion of the 803-4 Reservoir Disinfection System to LAS (w/ P2630) $70,000 S2050 Rancho San Diego Basin Sewer Rehabilitation - Phase 2 $160,000 S2079 PL - Steele Canyon Rd Bridge 6-inch Sewer FM Renovation $60,000 TOTAL: $750,000 3 Staff believes that an $800,000 cap on each of the As-Needed Engineering Design Services contracts is adequate, while still providing a buffer for any unforeseen tasks. Fees for professional services will be charged to the CIP projects. The As-Needed Engineering Design Services contracts do not commit the District to any expenditure until a task order is approved to perform the work. The District does not guarantee work to the consultants, nor does the District guarantee to the consultants that it will expend all the funds authorized by the contract on professional services. The District solicited engineering design services by placing an advertisement on the Otay Water District’s website and using PlanetBids, the District’s online bid solicitation website, on May 22, 2024. The advertisement was also placed in the Daily Transcript. Nine (9) firms submitted a Letter of Interest and a Statement of Qualifications. The Request for Proposal (RFP) for Engineering Design Services was sent to all nine (9) firms, resulting in seven (7) proposals received on July 2, 2024. Proposals were received from the following firms: • Burns & McDonnell (La Jolla, CA) • Dexter Wilson (Carlsbad, CA) • Lee & Ro (San Diego, CA) • KWC Engineers (Corona, CA) • NV5 (San Diego, CA) • Richard Brady & Associates (San Diego, CA) • Wood Rodgers Company (San Diego, CA) Firms that submitted Letters of Interest (LOI), but did not propose were Kimley-Horn and Horrocks Engineers. In accordance with the District’s Policy 21, staff evaluated and scored all written proposals scheduled interviews for the top four (4) firms on September 10, 2024. On Thursday, September 5, 2024, Lee & Ro notified the District they would be dropping out of the selection process due to a lack of available staff. Staff continued the interview process with the three (3) remaining firms. NV5 and Wood Rodgers received the highest scores based on their experience, understanding of the scope of work, proposed method to accomplish the work, and their composite hourly rate. Both consultants have provided similar services to the District as well as other local agencies and are readily available to provide the services required. A summary of the complete evaluation is shown in Attachment B. 4 NV5 and Wood Rodgers completed the Company Background Questionnaire, as required by the RFP, and staff did not find any significant issues. In addition, staff checked their references and performed an internet search on the company. Staff found the references to be excellent and did not find any outstanding issues with the internet search. FISCAL IMPACT: Joe Beachem, Chief Financial Officer The funds for these contracts will be expended on a variety of projects, as previously noted above. These contracts are for as-needed professional services based on the District's need and schedule, and expenditures will not be made until a task order is approved by the District for the consultant's services on a specific CIP project. Based on a review of the financial budget, the Project Manager anticipates that the budgets will be sufficient to support the professional as-needed consulting services required for the CIP projects noted above. The Finance Department has determined that the funds to cover these contracts will be available as budgeted for these projects. STRATEGIC GOAL: This Project supports the District’s Mission statement, “To provide exceptional water and wastewater service to its customers, and to manage District resources in a transparent and fiscally responsible manner” and the General Manager’s Vision, "To be a model water agency by providing stellar service, achieving measurable results, and continuously improving operational practices." GRANTS/LOANS: Not applicable. LEGAL IMPACT: None. KC/ML:jf Attachments: Attachment A – Committee Action Attachment B – Summary of Proposal Rankings ATTACHMENT A SUBJECT/PROJECT: Various Award of Two (2) Professional Services Contracts for As-Needed Engineering Design Services to NV5, Inc. and Wood Rodgers, Inc. for Fiscal Years 2025-2027 COMMITTEE ACTION: The Engineering, Operations, and Water Resources Committee (Committee) reviewed this item at a meeting held on October 16, 2024, and the following comments were made: •Staff recommended that the Board award two (2) professionalservice contracts for As-Needed Engineering Design Services and authorize the General Manager to execute two agreements withNV5, Inc. (NV5) and Wood Rodgers, Inc. (WR), each in an amountnot-to-exceed $800,000. The total amount of the two (2) contracts will not exceed $800,000 during Fiscal Years 2025-2027(ending June 30, 2027). •Staff noted that on September 5, 2024, one of the firmsselected, Lee & Ro, notified the district that they would have to drop out of the selection process due to availability ofstaff. •There was a discussion on fee scoring. Staff stated that thelowest fee gets the highest score within that specific category. The two selected consultants, NV5 and WR, proposed the 2nd and 4th lowest ranked rates. Following the discussion, the Committee supported staff’s recommendation and presentation to the full board as a consent item. Qualifications of Team Responsiveness and Project Understanding Technical and Management Approach INDIVIDUAL TOTAL - WRITTEN AVERAGE WRITTEN TOTAL Consultant's Commitment to DBE Additional Creativity and Insight Strength of Project Manager Presentation & Communication Skills Responses to Questions INDIVIDUAL TOTAL - ORAL AVERAGE ORAL TOTAL TOTAL SCORE WITHOUT FEE Proposed Fee TOTAL SCORE 30 25 30 85 85 Y/N 15 15 10 10 50 50 135 15 150 Poor/Good/ Excellent Jeff Marchioro 23 15 21 59 Lito Santos 21 18 21 60 Hector Licon 24 22 24 70 Brandon DiPietro 22 20 23 65 Kevin Cameron 24 20 25 69 Jeff Marchioro 23 21 21 65 Lito Santos 22 19 22 63 Hector Licon 25 23 25 73 Brandon DiPietro 24 21 23 68 Kevin Cameron 25 23 24 72 Jeff Marchioro 22 19 20 61 Lito Santos 21 19 21 61 Hector Licon 26 23 25 74 Brandon DiPietro 27 21 24 72 Kevin Cameron 23 20 24 67 Jeff Marchioro 25 21 25 71 Lito Santos 25 21 22 68 Hector Licon 27 23 26 76 Brandon DiPietro 23 21 23 67 Kevin Cameron 25 21 25 71 Jeff Marchioro 28 24 29 81 14 13 9 8 44 Lito Santos 30 24 28 82 15 15 9 9 48 Hector Licon 28 24 28 80 14 14 8 9 45 Brandon DiPietro 27 22 24 73 12 14 10 8 44 Kevin Cameron 28 24 28 80 14 14 9 8 45 Jeff Marchioro 25 21 26 72 13 12 8 7 40 Lito Santos 23 19 22 64 10 11 7 7 35 Hector Licon 27 23 27 77 13 12 8 8 41 Brandon DiPietro 25 21 22 68 10 11 10 8 39 Kevin Cameron 27 23 27 77 12 13 8 8 41 Jeff Marchioro 29 24 29 82 14 14 10 9 47 Lito Santos 29 23 29 81 15 15 10 9 49 Hector Licon 28 24 28 80 14 14 9 9 46 Brandon DiPietro 28 23 26 77 14 14 10 8 46 Kevin Cameron 27 24 28 79 14 15 9 8 46 Notes: Consultant Fee Score 1. Review Panel does not see or consider proposed fee when scoring other categories. The proposed fee is scored by Engineering staff not on the Review Panel. Burns and McDonnell $229 1 2. The fees were evaluated by comparing weighted rates for seven catagories. The sum of these 7 rates are noted on the table to the left. Dexter Wilson $155 14 KWC Engineers $150 15 Lee and RO $196 7 NV5 $157 14 Richard Brady & Associates $167 12 Woods Rodgers $183 9 FIRM NOT INTERVIEWED FIRM NOT INTERVIEWED FIRM NOT INTERVIEWED DROPPED OUT DUE TO STAFF AVAILABILITY ExcellentY471279136 39 111 12 123 45 124 14 138 Excellent 71 7 78 67 15 82 FEE SCORING CHART Burns McDonell KWC Engineers 67 Y Lee and RO 71 Y NV5 79 Y Richard Brady & Associates 72 Y Woods Rodgers 80 165 66 8268 MAXIMUM POINTS Dexter Wilson ATTACHMENT BSUMMARY OF PROPOSAL RANKINGS As-Needed Engineering Design Services - Fiscal Years 2025 - 2027 WRITTEN ORAL 14 REFERENCES 68 Y 65 Y STAFF REPORT TYPE MEETING: Regular Board MEETING DATE: November 6, 2024 SUBMITTED BY: Marissa Dychitan Senior Accountant PROJECT: DIV. NO. All APPROVED BY: Jon Ravaglioli, Finance Manager Kevin Koeppen, Assistant Chief of Finance Joseph R. Beachem, Chief Financial Officer Jose Martinez, General Manager SUBJECT: Approve the Audited Financial Statements for the Fiscal Year Ended June 30, 2024 GENERAL MANAGER'S RECOMMENDATION: That the Board approve the Audited Financial Statements (Attachment B), including the Independent Auditors' unqualified opinion, for the fiscal year ending June 30, 2024. COMMITTEE ACTION: See Attachment A. PURPOSE: To inform the Board of the significant financial events which occurred during the fiscal year ended June 30, 2024, as reflected in the audited financial statements. ANALYSIS: Davis Farr LLP performed the audit and found that, in all material respects, the financial statements correctly represent the District's AGENDA ITEM 10a 2 financial position. They found no material errors in the financial records or statements (Attachment D). Total Assets: Total assets increased by $5.0 million, or 0.81%, during Fiscal Year 2024, to $624.8 million, due to increases in cash and investments, as well as accounts receivables, which were partially offset by depreciation. Deferred Outflows and Deferred Inflows: Deferred outflows increased by $2.9 million, or 12.62%, in Fiscal Year 2024 due to increases in pension and OPEB actuarial costs. Deferred inflows decreased by $2.7 million, or 5.82%, due to decreases in deferred investment income for the OPEB plan and deferred inflows from leases. Total Liabilities and Net Positions: Total liabilities increased by $10.4 million, or 6.33%, from the previous fiscal year to $174.7 million. The increase is attributable to the increases in net pension and OPEB liabilities. The net position increased by $0.2 million, or 0.05%, to $431.3 million as of June 30, 2024. Capital Contributions: Capital contributions for Fiscal Year 2024 totaled $7.5 million. Fiscal Year 2024 capital contributions include $6.7 million from developers contributing capacity fees, $0.2 million in contributed fixed assets, and $0.1 million in CIP grants. Ratepayers also contributed $0.5 million in availability fees, which are considered part of capital contributions. Results of Operations: Operating revenues increased by $6.3 million, or 5.93%, due to increases in water and wastewater rates. The cost of water sales increased by $6.5 million, or 9.06%, due to higher unit purchase costs and increased volumes purchased. 3 Non-Operating Revenues and Expenses: Non-operating revenues increased by $2.3 million, or 16.01%, for Fiscal Year 2024, primarily due to an increase in investment income brought about by high interest rates on investments. Non-operating expenses increased by $0.6 million, or 12.42%, in Fiscal Year 2024, primarily due to the increased loss on disposal of capital assets and expenses associated with non-capitalizable CIP costs. Conclusion: In summary, the overall audit process was successful, and the auditors found no material errors or misstatements in the District's financial statements. Additional Audit Correspondence: As a part of completing the audit engagement, Davis Farr LLP also provided the following letters summarizing their observations and conclusions concerning the District's overall financial processes: • Management Letter (Independent Auditor’s Report): The auditors did not identify any internal control deficiencies that they considered material weaknesses. (Attachment C). • Audit Committee Letter: This letter describes the overall aspects of the audit, including audit principles, performance, dealings with management, and significant findings or issues. There were no disagreements with management concerning financial accounting, reporting, or auditing matters, and there were no significant difficulties in dealing with management in performing the audit. (Attachment D). • Report on Applying Agreed-Upon Procedures (Independent Accountant’s Report): A review of the District's investment portfolio at year-end and a sample of specific investment transactions completed throughout the fiscal year were performed. There were no exceptions to compliance from the District's Investment Policy. (Attachment E). 4 FISCAL IMPACT: None. STRATEGIC GOAL: The District ensures its continued financial health through long-term financial planning, formalized financial policies, enhanced budget controls, fair pricing, debt planning, and improved financial reporting. LEGAL IMPACT: None. Attachments: A) Committee ActionB) FY 2024 Audited Financial Statements C) Management Letter: Independent Auditor’s ReportD) Audit Committee LetterE) Report on Applying Agreed-Upon Procedures: Independent Accountant’s ReportF) PowerPoint Presentation by Davis Farr LLP ATTACHMENT A SUBJECT/PROJECT: Approve the Audited Financial Statements for the Fiscal Year Ended June 30, 2024 COMMITTEE ACTION: The Finance and Administration Committee (Committee) reviewed this informational item at a meeting held on October 16, 2024, and the following comments were made: • Staff presented the staff report to the Committee and introduced Ms. Shannon Ayala who provided a PowerPoint presentation of the Otay Water District Audit Result, Fiscal Year Ended June 30, 2024. • In response to a question from the Committee, Ms. Ayala stated that auditors selected five largest vendors that had the largest amount of payments for contract review and also compliance with the district’s purchasing policy. • There was a discussion on claims, suits and complaints filed or are pending against the district, which currently has no effect on the audit. If there are updates on this matter by October 28, the auditors will include it in the financial statements. On October 24, the District was notified that a claim has been remanded to trial court and that an award of damages was probable and must be accrued under Generally Accepted Accounting Principles. Staff has updated the attached financial statements (Attachment B) to reflect the accrual of estimated potential damages and fees associated with the claim. • Staff stated that the auditing process is different from the budgeting process. Budgeting entails planning for the future, whereas auditing is for a specific moment in time. • It was noted that the district’s auditing process is conducted every five years. Following the discussion, the Committee supported staff’s recommendation and presentation to the full board as an action item. OTAY WATER DISTRICT FINANCIAL STATEMENTS WITH REPORT ON AUDIT BY INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS YEAR ENDED JUNE 30, 2024 Attachment B Table of Contents Year Ended June 30, 2024 Independent Auditor’s Report Management’s Discussion & Analysis Basic Financial Statements: Statement of Net Position Statement of Revenues, Expenses, and Changes in Net Position Statement of Cash Flows Notes to Financial Statements Required Supplementary Information: 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 Schedule of Plan Contributions Page Number 1 4 14 16 17 19 64 65 66 67 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, 2024 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, 2024, 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. Responsibilities of Management for the Financial Statements The District’s management is responsible for the preparation and fair presentation of the financial statements in accordance with accounting principles generally accepted in the United States of America, and for the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, management is required to evaluate whether there are conditions or events, considered in the aggregate, that raise substantial doubt about the District’s ability to continue as a going concern for one year after the date that the financial statements are issued. 1 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 2023 financial statements, and we expressed an unmodified audit opinion on those audited financial statements in our report dated October 25, 2023. In our opinion, the summarized comparative information presented herein as of and for the year ended June 30, 2023, 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 25, 2024 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 25, 2024 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, 2024.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 $404.3 million (net position). Of this amount, $61.5 million (unrestricted net position)may be used to meet the District’s ongoing obligations to residents and creditors. Total assets increased by $5.0 million,or 0.8%,during Fiscal Year 2024 to $624.8 million, due to increases in cash and investments, and accounts receivables,which were partially offset by a drop in capital assets due to depreciation exceeding current year additions. 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 $404.3 million at the close of Fiscal Year 2024. The most significant portion of the District's net position, $336.1 million (83.1%), 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) 2024 2023 Assets Current and Other Assets $ 187.9 $ 176.3 Capital Assets 436.9 443.5 Total Assets 624.8 619.8 Deferred Outflows of Resources Deferred Actuarial Pension Costs 13.3 15.9 Deferred Actuarial OPEB Costs 12.2 6.7 Total Deferred Outflows of Resources 25.5 22.6 Liabilities Current Liabilities 36.4 34.6 Long-Term Debt Outstanding 95.0 95.0 Net Pension Liability 28.6 25.9 Net OPEB Liability 11.2 5.0 Other Liabilities 30.5 3.8 Total Liabilities 201.7 164.3 Deferred Inflows of Resources Deferred Inflows from Leases 43.4 45.4 Deferred Actuarial OPEB Costs 0.9 1.6 Total Deferred Inflows of Resources 44.3 47.0 Net Position Net Investment in Capital Assets 336.1 341.2 Restricted for Debt Service 3.6 3.5 Restricted for Capital Assets 3.1 3.0 Unrestricted 61.5 83.4 Total Net Position $ 404.3 $ 431.1 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 13% 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 2024,the District's Capital Assets increased by $7.9 million before accumulated depreciation (see Note 4 in the Notes to Financial Statements).The District’s long-term debt (excluding current maturities) remains the same due to the addition of new Subscription-Based Technology Arrangements (SBITA), offset by the annual debt service payments (see Note 5 in the Notes to Financial Statements). Total liabilities increased by $37.4 million in FY 2024,primarily due to increases in Net Pension and OPEB liabilities, and accrued litigation. In FY 2024, deferred outflows of resources increased by $2.9 million due to increases in the actuarial pension and OPEB costs. Deferred inflows of resources decreased by $2.7 million in FY 2024 due to decreases in the actuarial OPEB costs and deferred inflows from leases. At the end of FY 2024,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) 2024 2023 Water Sales $105.7 $99.9 Wastewater Revenue 3.5 3.3 Connection and Other Fees 3.3 3.0 Non-operating Revenues 16.9 14.6 Total Revenues 129.4 120.8 Depreciation Expense 18.3 17.9 Other Operating Expenses 113.0 100.9 Non-operating Expenses 32.4 4.8 Total Expenses 163.7 123.6 Income (Loss) Before Capital Contributions (34.3)(2.8) Capital Contributions 7.5 9.2 Change in Net Position (26.8) 6.4 Beginning Net Position 431.1 424.7 Ending Net Position $ 404.3 $ 431.1 Water Sales increased by $5.8 million in FY 2024 due to the increase in water rates necessary to pass through increasing costs placed on the District. Other Operating Expenses increased by $12.1 million in FY 2024, predominantly due to the increase in administrative and general expenses caused by increases in pension and OPEB costs and an increase in the cost of water.Non-operating expenses increased by $27.6 million due to the recognition of litigation expenses. Specific planning and environmental study costs associated with capital projects do not qualify as capital costs under Generally Accepted Accounting Principles. These costs are included in the District's miscellaneous (non-operating) expenses. For FY 2024,those expenses were $0.5 million. Connection and Other Fees increased by $0.3 million in FY 2024 due to an increase in expansion-related operating costs, which are funded by capacity fees. 8 Management’s Discussion and Analysis Capital Contributions decreased by $1.7 million in FY2024 due to less developer-built facilities. Non-operating Revenues Non-operating Revenues by Major Source (In Millions of Dollars) 2024 2023 Taxes and Assessments $5.8 $5.6 Rents and Leases 2.1 2.2 Other Non-operating Revenue 9.0 6.8 Total Non-operating Revenues $ 16.9 $ 14.6 The District's total non-operating revenues increased by $2.3 million in FY 2024 due primarily to the increase in investment earnings brought about by high interest rates. Capital Assets and Debt Administration The District's capital assets (net of accumulated depreciation) as of June 30, 2024, totaled $436.9 million. Included in this amount is land, which is a non-depreciable asset.The District's net capital assets decreased by 1.5% in FY 2024. 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 and Right to Use Assets.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, 2024, the District had $95.0 million in outstanding debt (net of $5.2 million of maturities occurring in FY 2025), which consisted of the following: Lease Payable $ 0.7 Subscription-Based IT Payable 4.9 Revenue Bonds 89.4 Total Long-Term Debt $ 95.0 Additional information on the District's long-term debt can be found in Note 5 of the Notes to Financial Statements. 2024 2023 Land $14.5 $14.5 Construction in Progress 10.7 11.7 Potable Water System 547.4 542.6 Recycled Water System 119.2 119.2 Wastewater System 59.3 59.4 Field Equipment 6.6 8.3 Buildings 19.3 19.7 Transportation Equipment 5.0 3.9 Communication Equipment 2.5 2.6 Office Equipment 8.0 8.1 Right to Use Assets –Leases 0.7 0.7 Right to Use Assets -SBITA 5.6 0.2 Total Capital Assets 798.8 790.9 Less Accumulated Depreciation (361.9)(347.4) Net Capital Assets $ 436.9 $ 443.5 10 Management’s Discussion and Analysis Fiscal Year 2024-2025 Budget Economic Factors The San Diego region imports 72.0% 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 above-average rainfall of 12.2 inches in FY 2024.The 10-year average of 10.7 inches for San Diego rainfall reflects the long-term drought conditions for our area.San Diego's rainfall average over 20 years is 9.9 inches,the 30-year average is 9.5 inches,and the 40-year average is 9.9 inches. While water sales peaked in 2008, prolonged droughts led to an increase in conservation,which has had a permanent influence on volumes.The FY 2025 sales volume is budgeted to decrease by 1.0% compared to the previous year's budget. 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 240,000 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 long-term contract with the District to provide recycled water for landscape and irrigation usage. Through innovative agreements like these, both parties can benefit by using another agency's excess capacity and diversifying local supply, thereby increasing reliability. 11 Management’s Discussion and Analysis Financial The District is budgeted to deliver approximately 27,296.2 acre-feet of potable water to 52,057 potable customer accounts during FY 2025.The FY 2025 budget was prepared with the continuing challenges of potable water wholesale supplier rate increases, inflation, additional CIP projects, increasing power costs, current and pending legislative initiatives, and climate change.Additional challenges include the costs associated with the City of San Diego’s Pure Water program and the County of San Diego’s rehabilitation of shared facilities. Inflation and increased regulation continue to significantly impact the District’s financial position. The District’s wholesale water supplier has approved a 14.0% overall rate increase in FY 2025, with projected increases of 16.4% in FY 2026 and 5.6% in FY 2027. The FY 2025 inflationary impact on material and administrative expenses is approximately $0.5 million, while the inflationary impact on the CIP is estimated to be $5.4 million over the six-year projection.SDG&E rate increases are expected to increase energy costs by 18.0%, resulting in a $0.8 million increase. Regulatory mandates are also adding pressure to both operating and CIP budgets, increasing material and administrative expense budgets by $0.8 million. Climate change presents another challenge for the District. Weather patterns today and in the future are projected to bring longer drought periods and less frequent, but more intense, rainfall periods. These prolonged drought periods result in increasing conservation requirements leading to permanent reductions in water consumption. 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 London Moeder Advisors' economic report suggests that while the County’s economy would continue to expand in 2024, the pace was anticipated to be consistent with the prior year in key metrics,including inflation,as supported by March 2024 CPI data. The six-year rate model assumes administrative and material inflation of 3.6% from FY 2025 through FY 2030. District staff projects that the District will sell another 906 water meters over the next six years,translating to 3,209 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 lawsuit against the District 12 Management’s Discussion and Analysis (Coziahr v. Otay Water District, Superior Court of the State of California, County of San Diego), contending that the District’s water rates violated Article XIIID of the California Constitution (“Proposition 218”). On March 4, 2021, the court issued a decision in favor of the plaintiffs, the District appealed the trial court’s decision to the Court of Appeal, and in July of 2024, the Court of Appeal issued its decision upholding much of the trial court’s decision, but remanding the issue of the allocation of refunds back to the trial court for a new trial. The matter has been remanded to the trial court for further proceedings as to the allocation of any refunds and for an award of attorneys’ fees. The estimated potential liability to the District, if the court were to award attorneys fees and damages, may be as high as $27,000,000 (“Estimated Potential Liability”). The District has accrued the Estimated Potential Liability, which has impacted the District’s net revenue for Fiscal Year 2023-24. The District expects to utilize reserves to fund the Estimated Potential Liability if and when due. However, because of the expense accrued for the Estimated Potential Liability, the debt service coverage ratio of the District’s outstanding Water Revenue Bonds from Taxes and Net Revenues will be negatively impacted for Fiscal Year 2023-24. The accrual of the Estimated Potential Liability has not affected the District’s ability to pay the installment payments or principal and interest due with respect to any of the District’s outstanding Water Revenue Bonds payable or its ability to comply with its covenants (and particularly its covenant with respect to rates and charges) related to the Water Revenue Bonds. Further, the District believes that the payment of the Estimated Potential Liability using its reserves will not have a material effect on the District’s financial condition, as the potential loss has already been incorporated into its financial projections. Nevertheless, the District may replenish some or all of those reserves with increases to rates. 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 STATEMENT OF NET POSITION June 30, 2024 (with comparative totals as of June 30, 2023) 2024 2023 ASSETS Current Assets: Cash and Cash Equivalents (Notes 1 and 2)77,264,706$ 43,753,408$ Restricted Cash and Cash Equivalents (Notes 1 and 2)3,132,285 3,078,363 Investments (Notes 1 and 2)35,691,622 59,781,150 Restricted Investments (Notes 1 and 2)3,587,676 3,444,377 Accounts Receivable, Net 16,570,788 14,313,664 Accrued Interest Receivable 1,126,759 846,231 Taxes and Availability Charges Receivable, Net 287,785 305,094 Restricted Taxes and Availability Charges Receivable, Net 4,884 6,182 Current Lease Receivable (Note 12)1,041,530 962,482 Inventories 2,073,038 2,053,393 Prepaid Items and Other Receivables 1,885,417 1,501,252 Total Current Assets 142,666,490 130,045,596 Non-current Assets: Capital Assets (Note 4): Land 14,479,573 14,479,573 Construction in Progress 10,712,815 11,741,448 Capital Assets, Net of Depreciation 411,694,772 417,230,754 Lease Receivable (Note 12)45,228,436 46,270,266 Total Non-current Assets 482,115,596 489,722,041 Total Assets 624,782,086 619,767,637 DEFERRED OUTFLOWS OF RESOURCES Deferred Actuarial Pension Costs (Note 7)13,279,616 15,951,074 Deferred Actuarial OPEB Costs (Note 8)12,206,112 6,679,231 Total Deferred Outflows of Resources 25,485,728 22,630,305 Continued The accompanying notes are an integral part of this statement. 14 STATEMENT OF NET POSITION Continued June 30, 2024 (with comparative totals as of June 30, 2023) 2024 2023 LIABILITIES Current Liabilities: Current Maturities of Long-term Debt (Note 5)5,224,677$ 5,589,735$ Accounts Payable 16,842,486 14,985,218 Accrued Payroll Liabilities 1,095,145 1,102,208 Other Accrued Liabilities 6,247,354 5,729,278 Customer and Developer Deposits 5,490,122 5,573,296 Accrued Interest 1,491,005 1,573,222 Total Current Liabilities 36,390,789 34,552,957 Non-current Liabilities: Long-term Debt (Note 5): Revenue Bonds 89,430,762 94,256,620 Lease Payable 671,758 690,539 Subscription-Based IT Payable (Note 5)4,914,393 35,476 Net Pension Liability (Note 7)28,553,945 25,951,095 Net OPEB Liability (Note 8)11,202,346 5,051,261 Other Non-current Liabilities (Note 9)30,548,589 3,768,468 Total Non-current Liabilities 165,321,793 129,753,459 Total Liabilities 201,712,582 164,306,416 DEFERRED INFLOWS OF RESOURCES Deferred Inflows from Leases (Note 12)43,410,817 45,442,359 Deferred Actuarial OPEB Costs (Note 8)870,274 1,574,138 Total Deferred Inflows of Resources 44,281,091 47,016,497 NET POSITION Net Investment in Capital Assets 336,050,508 341,227,728 Restricted for Debt Service 3,636,078 3,476,509 Restricted for Capital Assets 3,083,883 3,046,231 Unrestricted (Note 6)61,503,672 83,324,561 Total Net Position 404,274,141$ 431,075,029$ The accompanying notes are an integral part of this statement. 15 STATEMENT OF REVENUES, EXPENSES, AND CHANGES IN NET POSITION Year Ended June 30, 2024 (with comparative totals for the year ended June 30, 2023) 2024 2023 OPERATING REVENUES Water Sales 105,736,843$ 99,901,174$ Wastewater Revenue 3,494,312 3,315,754 Connection and Other Fees 3,253,978 2,975,495 Total Operating Revenues 112,485,133 106,192,423 OPERATING EXPENSES Cost of Water Sales 77,807,009 71,342,741 Wastewater 2,400,881 2,497,316 Administrative and General 32,717,662 27,073,523 Depreciation 18,276,492 17,880,335 Total Operating Expenses 131,202,044 118,793,915 Operating Income (Loss)(18,716,911)(12,601,492) NON-OPERATING REVENUES (EXPENSES) Investment Earnings 6,393,523 4,088,331 Taxes and Assessments 5,777,012 5,618,253 Availability Charges 741,705 710,954 Gain (Loss) on Disposal of Capital Assets (725,060)(111,029) Rents and Leases 2,083,669 2,181,634 Miscellaneous Revenues 1,896,115 1,961,168 Donations (103,200)(92,000) Interest Expense (4,137,615)(4,310,352) Miscellaneous Expenses (27,478,412)(330,421) Total Non-operating Revenues (Expenses)(15,552,263)9,716,538 Income (Loss) Before Capital Contributions (34,269,174)(2,884,954) Capital Contributions 7,468,286 9,237,196 Change in Net Position (26,800,888)6,352,242 Total Net Position, Beginning 431,075,029 424,722,787 Total Net Position, Ending 404,274,141$ 431,075,029$ The accompanying notes are an integral part of this statement. 16 STATEMENT OF CASH FLOWS Year Ended June 30, 2024 (with comparative totals for the year ended June 30, 2023) 2024 2023 CASH FLOWS FROM OPERATING ACTIVITIES Receipts from Customers 106,875,559$ 105,268,572$ Receipts from Connections and Other Fees 3,253,978 2,975,495 Receipts from Property Rents and Leases 52,127 314,995 Other Receipts 1,128,578 1,178,333 Payments to Suppliers (53,512,056) (75,408,680) Payments to Employees (25,474,256) (25,602,901) Other Payments (27,581,612) (422,421) Net Cash Provided By (Used For) Operating Activities 4,742,318 8,303,393 CASH FLOWS FROM NONCAPITAL AND RELATED FINANCING ACTIVITIES Receipts from Taxes and Assessments 6,530,074 6,065,432 Net Cash Provided By (Used For) Noncapital and Related Financing Activities 6,530,074 6,065,432 CASH FLOWS FROM CAPITAL AND RELATED FINANCING ACTIVITIES Proceeds from Capital Contributions 7,221,234 6,148,060 Proceeds from Sale of Capital Assets - 64,042 Proceeds from Property Rents and Leases 1,630,303 1,503,495 Proceeds from Debt Related Taxes and Assessments 7,250 245,063 Principal Payments on Long-Term Debt (5,452,872) (5,563,365) Interest Payments and Fees (3,814,672) (4,074,051) Acquisition and Construction of Capital Assets (6,690,118) (11,547,330) Net Cash Provided By (Used For) Capital and Related Financing Activities (7,098,875) (13,224,086) CASH FLOWS FROM INVESTING ACTIVITIES Interest Received on Investments 4,146,000 2,407,520 Proceeds from Sale and Maturities of Investments 40,339,069 7,600,000 Purchase of Investments (15,093,366) (55,085,244) Net Cash Provided By (Used For) Investing Activities 29,391,703 (45,077,724) Net Increase (Decrease) in Cash and Cash Equivalents 33,565,220 (43,932,985) Cash and Cash Equivalents - Beginning 46,831,771 90,764,756 Cash and Cash Equivalents - Ending 80,396,991$ 46,831,771$ Continued The accompanying notes are an integral part of this statement. 17 STATEMENT OF CASH FLOWS Continued Year Ended June 30, 2024 (with comparative totals for the year ended June 30, 2023) 2024 2023 Reconciliation of Operating Income (Loss) to Net Cash Flows Provided By (Used For) Operating Activities: Operating Income (Loss)(18,716,911)$ (12,601,492)$ Adjustments to Reconcile Operating Income to Net Cash Provided By (Used For) Operating Activities: Depreciation 18,276,492 17,880,335 Receipts from Property Rents and Leases 52,127 314,995 Miscellaneous Revenues 1,128,578 1,178,333 Miscellaneous Expenses and Donations (27,581,612) (422,421) (Increase) Decrease in Accounts Receivable (2,257,124) 1,137,255 (Increase) Decrease in Inventory (19,645) (703,173) (Increase) Decrease in Prepaid Items and Other Receivables (384,165) 1,006,451 (Increase) Decrease in Net OPEB Asset - 3,005,037 (Increase) Decrease in Deferred Actuarial Pension Costs 2,671,458 (11,469,305) (Increase) Decrease in Deferred Actuarial OPEB Costs (5,526,881) (3,601,175) Increase (Decrease) in Accounts Payable 1,857,268 (709,462) Increase (Decrease) in Accrued Payroll and Related Expenses (7,063) 124,034 Increase (Decrease) in Other Accrued Liabilities 518,076 755,494 Increase (Decrease) in Customer and Developer Deposits (98,472) 914,389 Increase (Decrease) in Other Non-current Liabilities 26,780,121 64,236 Increase (Decrease) in Net OPEB Liability 6,151,085 5,051,261 Increase (Decrease) in Net Pension Liability 2,602,850 25,670,797 Increase (Decrease) in Deferred Actuarial Pension Costs - (14,422,139) Increase (Decrease) in Deferred Actuarial OPEB Costs (703,864) (4,870,057) Net Cash Provided By (Used For) Operating Activities 4,742,318$ 8,303,393$ Schedule of Cash and Cash Equivalents: Current Assets: Cash and Cash Equivalents 77,264,706$ 43,753,408$ Restricted Cash and Cash Equivalents 3,132,285 3,078,363 Total Cash and Cash Equivalents 80,396,991$ 46,831,771$ Supplemental Disclosures Non-Cash Investing and Financing Activities Consisted of the Following: Contributed Capital for Water and Sewer System 247,052$ 3,089,136$ Change in Fair Value of Investments (1,299,474) (551,965) Amortization Related to Long-term Debt 377,675 460,484 The accompanying notes are an integral part of this statement. 18 Notes To Financial Statements Year Ended June 30, 2024 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 on the Statement of Net Position. 19 Notes To Financial Statements Year Ended June 30, 2024 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. 20 Notes To Financial Statements Year Ended June 30, 2024 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 $32,519 at June 30, 2024. 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. 21 Notes To Financial Statements Year Ended June 30, 2024 1)REPORTING ENTITY AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES -Continued C)Pending Accounting Pronouncements GASB has issued the following statements which may impact the District’s financial reporting requirements in the future: i.GASB Statement 101 -“Compensated Absences”, effective for reporting periods beginning after December 15, 2023. ii.GASB Statement 102 -“Certain Risk Disclosures”, effective for reporting periods beginning after June 15, 2024. iii.GASB Statement 103 -“Financial Reporting Model Improvements”, 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 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 two items that qualify for reporting in this category. Accordingly, the items (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. 22 Notes To Financial Statements Year Ended June 30, 2024 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. All investments are stated at their fair value. The District has not elected to report certain investments at amortized costs. 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. 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. 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. 23 Notes To Financial Statements Year Ended June 30, 2024 1)REPORTING ENTITY AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES –Continued H)Capital Assets –Continued Depreciation is calculated using the straight-line method over the following estimated useful lives: Water System 15-70 Years Field Equipment 2-50 Years Buildings 30-50 Years Communication Equipment 2-10 Years Transportation Equipment 2-7 Years Office Equipment 2-10 Years Recycled Water System 15-70 Years Wastewater System 25-50 Years Right to Use Asset/SBITA The estimated life of the leased/subscribed asset or the contract term 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. 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. 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 $268,076 for 2024. 24 Notes To Financial Statements Year Ended June 30, 2024 1)REPORTING ENTITY AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES -Continued 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, 2022 Measurement Date June 30, 2023 Measurement Period July 1, 2022 to June 30, 2023 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. 25 Notes To Financial Statements Year Ended June 30, 2024 1)REPORTING ENTITY AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES -Continued N) Other Post-Employment Benefits (OPEB) 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, 2023 Measurement Date June 30, 2023 Measurement Period July 1, 2022 to June 30, 2023 O)Leases The District is a lessor and lessee for leases as detailed in Footnotes 5 and 11. 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. 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. 26 Notes To Financial Statements Year Ended June 30, 2024 1)REPORTING ENTITY AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES -Continued P)Subscription Based Information Technology Arrangements (SBITAs) -Continued 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. 27 Notes To Financial Statements Year Ended June 30, 2024 2)CASH AND INVESTMENTS -Continued Cash and Investments are classified in the accompanying financial statements as follows: Cash and Investments consist of the following: 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 77,264,706$ Restricted Cash and Cash Equivalents 3,132,285 Investments 35,691,622 Restricted Investments 3,587,676 Total Cash and Investments 119,676,289$ Cash on Hand 3,100$ Deposits with Financial Institutions 1,095,094 Investments 118,578,095 Total Cash and Investments 119,676,289$ 28 Notes To Financial Statements Year Ended June 30, 2024 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, 2024. 29 Notes To Financial Statements Year Ended June 30, 2024 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, 2024. 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 2024 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 $ 46,304,216 32,862,350$ 13,441,866$ -$ U.S. Treasury Obligations 5,959,920 2,970,570 2,989,350 - Local Agency Investment Fund (LAIF) 65,123,748 65,123,748 - - San Diego County Pool 905,000 905,000 - - Money Market Funds 285,211 285,211 - - Total $ 118,578,095 $ 102,146,879 $ 16,431,216 -$ Remaining Maturity (in Months) Legal Minimum Not Investment Type Total Rating AAA Rated U.S. Government Sponsored Entities $ 46,304,216 A 46,304,216$ -$ U.S. Treasury Obligations 5,959,920 N/A - 5,959,920 Local Agency Investment Fund (LAIF) 65,123,748 N/A - 65,123,748 San Diego County Pool 905,000 N/A 905,000 - Money Market Funds 285,211 AAA 285,211 - Total $ 118,578,095 47,494,427$ 71,083,668$ Rating as of Year End 30 Notes To Financial Statements Year Ended June 30, 2024 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, 2024: 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 market 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, 2024, $1,293,995 of the District’s deposits with financial institutions in excess of federal depository insurance limits, were held in collateralized accounts. Local Agency Investment Fund (LAIF) The District is a voluntary participant in the Local Agency Investment Fund (LAIF) that is regulated by California Government Code Section 16429 under the oversight of the Treasurer of the State of California. Reported Issuer Investment Type Amount Federal Home Loan Bank U.S. Government Sponsored Entities 8,977,800$ Federal National Mortgage Assoc.U.S. Government Sponsored Entities 11,846,300 Federal Farm Credit Bank U.S. Government Sponsored Entities 15,902,160 Federal Home Loan Mortgage U.S. Government Sponsored Entities 9,577,956 31 Notes To Financial Statements Year Ended June 30, 2024 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, 2024 was 4.36%. The estimated amortized cost and fair value of the LAIF pool at June 30, 2024 was $65,123,748. San Diego County Pooled Fund The San Diego County Pooled Investment Fund (SDCPIF) is a pooled investment fund program governed by the County of San Diego Board of Supervisors and administered by the County of San Diego Treasurer and Tax Collector. Investments in SDCPIF are highly liquid as deposits and withdrawals can be made at any time without penalty, determined on an amortized cash basis, the same as the fair value of the District’s position in the pool. The County of San Diego’s bank deposits are either federally insured or collateralized in accordance with the California Government Code. Pool detail is included in the County of San Diego Comprehensive Annual Financial Report (“Annual Report”). Copies of the Annual Report may be obtained from the County of San Diego Auditor-Controller’s Office –1600 Pacific Coast Highway, San Diego California 92101. Cash and investments are restricted for the cost of the following District projects and debt service: Cash and Cash Equivalents: New Water Supply 3,083,883$ Cash and Cash Equivalents: Debt Service: Water Revenue Bond Series 2010A 15,016$ Water Revenue Bond Series 2010B 33,386 48,402$ 32 Notes To Financial Statements Year Ended June 30, 2024 2)CASH AND INVESTMENTS –Continued Restricted Investments 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. Debt Service: Water Revenue Bond Series 2010A 987,651$ Water Revenue Bond Series 2010B 2,600,025 3,587,676$ 33 Notes To Financial Statements Year Ended June 30, 2024 3)FAIR VALUE MEASUREMENTS -Continued Fair value of assets measured on a recurring basis at June 30, 2024 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 46,304,216$ -$46,304,216$ -$ U.S. Treasury Obligations 5,959,920 5,959,920 -- Local Agency Investment Fund (LAIF) 65,123,748 -- 65,123,748 San Diego County Pool 905,000 --905,000 Money Market Funds 285,211 --285,211 Total $118,578,095 $ 5,959,920 $ 46,304,216 $ 66,313,959 34 Notes To Financial Statements Year Ended June 30, 2024 4)CAPITAL ASSETS The following is a summary of changes in Capital Assets for the year ended June 30, 2024: Depreciation expense for the year ended June 30, 2024 was $18,276,492. Beginning Ending Balance Additions Deletions Balance Capital Assets, Not Depreciated: Land $ 14,479,573 $ - $ - $ 14,479,573 Construction in Progress 11,741,448 6,690,119 (7,718,752) 10,712,815 Total Capital Assets, Not Depreciated 26,221,021 6,690,119 (7,718,752) 25,192,388 Capital Assets, Being Depreciated: Infrastructure 721,156,409 6,465,414 (1,723,745) 725,898,078 Field Equipment 8,337,001 266,284 (1,962,160) 6,641,125 Buildings 19,729,303 91,050 (560,947) 19,259,406 Transportation Equipment 3,916,153 1,057,730 (2,177) 4,971,706 Communication Equipment 2,602,855 - (97,381) 2,505,474 Office Equipment 8,064,375 85,326 (172,656) 7,977,045 Right to Use Assets - Leases 738,501 - - 738,501 Right to Use Assets - SBITA 123,039 5,499,767 - 5,622,806 Total Capital Assets, Being Depreciated 764,667,636 13,465,571 (4,519,066) 773,614,141 Less Accumulated Depreciation: Infrastructure 316,855,095 16,555,831 (1,199,610) 332,211,316 Field Equipment 6,809,532 278,799 (1,935,467) 5,152,864 Buildings 11,015,579 483,851 (390,106) 11,109,324 Transportation Equipment 2,839,122 347,489 (2,176) 3,184,435 Communication Equipment 2,249,323 107,503 (97,382) 2,259,444 Office Equipment 7,560,048 174,167 (169,264) 7,564,951 Right to Use Assets - Leases 70,333 35,167 - 105,500 Right to Use Assets - SBITA 37,850 293,685 - 331,535 Total Accumulated Depreciation 347,436,882 18,276,492 (3,794,005) 361,919,369 Total Capital Assets, Being Depreciated, Net 417,230,754 (4,810,921) (725,061) 411,694,772 Total Capital Assets, Net $ 443,451,775 $ 1,879,198 $ (8,443,813) $ 436,887,160 35 Notes To Financial Statements Year Ended June 30, 2024 5) LONG-TERM DEBT Long-term liabilities for the year ended June 30, 2024 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 $3,505,000 from September 1, 2025 through September 1, 2040; bearing interest at 6.377% to 6.577%. Beginning Ending Due Within Balance Additions Deletions Balance One Year Revenue Bonds: 2010 Water Revenue Bonds Series A 2,530,000$ -$ (1,235,000)$ 1,295,000$ 1,295,000$ 2010 Water Revenue Bonds Series B 36,355,000 - - 36,355,000 - 2013 Water Revenue Refunding Bonds 835,000 - (835,000) - - 2016 Water Revenue Refunding Bonds 25,370,000 - (1,350,000) 24,020,000 1,420,000 2018 Water Revenue Bonds 27,055,000 - (1,650,000) 25,405,000 1,730,000 2019 Wastewater Revenue Bonds 2,985,000 - (75,000) 2,910,000 75,000 2010 Series A Unamortized Premium 93,002 - (74,402) 18,600 18,600 2013 Bonds Unamortized Premium 16,015 - (16,015) - - 2016 Bonds Unamortized Premium 2,351,190 - (178,571) 2,172,619 178,571 2018 Bonds Unamortized Premium 2,201,154 - (109,148) 2,092,006 109,148 2019 Bonds Unamortized Discount (12,066) - 461 (11,605) (461) Net Revenue Bonds 99,779,295 - (5,522,675) 94,256,620 4,825,858 Lease Payable 707,727 - (17,188) 690,539 18,781 Subscription-Based IT Payable 85,348 5,499,767 (290,684) 5,294,431 380,038 Total Long-Term Liabilities 100,572,370$ 5,499,767$ (5,830,547)$ 100,241,590$ 5,224,677$ 36 Notes To Financial Statements Year Ended June 30, 2024 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 2013, 2016 Water Revenue Refunding Bonds and 2018 Water Revenue Bonds described below. The original issue premium is being amortized over the 14-year life of the Series 2010A bonds. Amortization for the year ending June 30, 2024 was $74,402. The amortization is included in interest expense. The unamortized premium at June 30, 2024 is $18,600. 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, 2024. In June 2013, the 2013 Water Revenue Refunding Bonds were issued to defease the 2004 Refunding Certificates of Participation. The bonds were issued with a face value of $7,735,000 plus a $984,975 original issue premium. The bonds are due in annual installments of $660,000 to $835,000 from September 1, 2013 through September 1, 2023; bearing interest at 1% to 4%. The installment payments are to be made from taxes and net revenues of the Water System, on parity with the payments required to be made by the District for the 2016 Water Revenue Refunding Bonds, the 2010A, 2010B and 2018 Water Revenue Bonds. The original issue premium is being amortized over the 11-year life of the Series 2013 bonds. Amortization for the year ending June 30, 2024 was $16,015. The amortization is included in interest expense. The unamortized premium at June 30, 2024 is $0. 37 Notes To Financial Statements Year Ended June 30, 2024 5)LONG-TERM DEBT –Continued Water Revenue Bonds –Continued 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 savings between the cash flow required to service, the old debt and the cash flow required to service the new debt is $5,664,140 and represent an economic gain on refunding of $4,538,175. The original issue premium is being amortized over the 20-year life of the Series 2016 bonds. Amortization for the year ending June 30, 2024 was $178,571. The amortization is included in interest expense. The unamortized premium at June 30, 2024 is $2,172,619. 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, 2024 was $109,148. The amortization expense is included in interest expense. The unamortized premium at June 30, 2024 is $2,092,006. 38 Notes To Financial Statements Year Ended June 30, 2024 5)LONG-TERM DEBT –Continued Water Revenue Bonds –Continued The total amount outstanding at June 30, 2024 and aggregate maturities of the revenue bonds for the fiscal years subsequent to June 30, 2024, are as follows: For the Year Ended June 30,Principal Interest Principal Interest 2025 1,295,000$ 33,994$ -$ 2,371,868$ 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 2030-2034 - - 9,925,000 8,425,226 2035-2039 - - 13,635,000 4,590,582 2040-2041 - - 6,795,000 453,977 1,295,000$ 33,994$ 36,355,000$ 24,593,220$ 2010 Water Revenue Bond Series A 2010 Water Revenue Bond Series B For the Year Ended June 30,Principal Interest Principal Interest 2025 1,420,000$ 806,581$ 1,730,000$ 1,061,288$ 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 2030-2034 9,655,000 1,611,809 6,220,000 2,935,238 2035-2039 6,520,000 286,219 6,550,000 1,596,500 2040-2044 - - 5,060,000 450,331 24,020,000$ 5,198,058$ 25,405,000$ 9,453,384$ Refunding Bonds Revenue Bonds 2016 Water Revenue 2018 Water 39 Notes To Financial Statements Year Ended June 30, 2024 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, 2024 was $461. The amortization expense is included in interest expense. The unamortized discount at June 30,2024 is $11,605. The 2019 Wastewater Revenue Bonds contains various covenants and restrictions, principally that the District fix, prescribe, revise and collect rates, fees and charges for the Wastewater System which will at least be sufficient to yield, during each fiscal year, net revenues equal to one hundred fifteen percent (115%) of the debt service for such fiscal year. The District was in compliance with these rate covenants for the fiscal year ended June 30, 2024. Future debt service requirements for the bonds are as follows: For the Year Ended June 30,Principal Interest 2025 75,000$ 85,416$ 2026 80,000 83,091 2027 80,000 80,691 2028 85,000 78,216 2029 85,000 75,666 2030-2034 470,000 339,364 2035-2039 535,000 270,623 2040-2044 615,000 186,188 2045-2049 725,000 83,203 2050 160,000 2,500 2,910,000$ 1,284,958$ 2019 Wastewater Revenue Bonds 40 Notes To Financial Statements Year Ended June 30, 2024 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 $126,353,656 payable through fiscal year 2044. For June 30, 2024, principal and interest paid by the water sales revenues were $5,070,000 and $4,509,050 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 $4,194,958 payable through fiscal year 2050. For June 30, 2024, principal and interest paid by the wastewater sales revenues were $75,000 and $87,291, 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 5 years each. As of June 30, 2024, the value of the lease payable is $690,539. Future lease payable requirements are as follows: For the Year Ended June 30,Principal Interest 2025 18,781$ 9,479$ 2026 20,469 9,207 2027 22,253 8,911 2028 24,134 8,590 2029 26,114 8,242 2030-2034 164,375 34,945 2035-2039 233,151 21,273 2040-2042 181,262 3,994 690,539$ 104,641$ 41 Notes To Financial Statements Year Ended June 30, 2024 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, 2024, the value of the subscription liability is $11,831. The District is required to make annual fixed payments of $11,995.The subscription has an interest rate of 1.39%. The value of the right to use asset as of June 30, 2024 is $35,494 with accumulated amortization of $23,663 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, 2024, the value of the subscription liability is $23,643. The District is required to make annual fixed payments of $23,972. The subscription has an interest rate of 1.39%.The value of the right to use asset as of June 30, 2024 of $70,934 with accumulated amortization of $47,290 is included in note 4 with right to use assets. Drone Deploy On April 30, 2023, the District entered into a 14-month subscription for the use of Drone Deploy software. An initial subscription liability was recorded in the amount of $16,611. As of June 30, 2024, the value of the subscription liability is $0. The value of the right to use asset as of June 30, 2024 of $16,611 with accumulated amortization of $16,611 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, 2024, the value of the subscription liability is $5,101,340. 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, 2024 is $5,270,119 with accumulated amortization of $175,671 is included in note 4 with right to use assets. 42 Notes To Financial Statements Year Ended June 30, 2024 5)LONG-TERM DEBT –Continued Subscription-Based Information Technology Arrangements –Continued 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, 2024, the value of the subscription liability is $46,538. 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, 2024 is $61,870 with accumulated amortization of $12,374 is included in note 4 with right to use assets. 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, 2024, the value of the subscription liability is $111,079. 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, 2024 is $167,779 with accumulated amortization of $55,926 is included in note 4 with right to use assets. Future SBITA payable requirements are as follows: For the Year Ended June 30,Principal Interest 2025 380,038$ 73,593$ 2026 350,056 68,310 2027 274,113 63,444 2028 288,050 59,634 2029 302,485 55,630 2030-2034 1,747,504 210,816 2035-2039 1,952,185 77,409 5,294,431$ 608,836$ 43 Notes To Financial Statements Year Ended June 30, 2024 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, 2024: 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. Designated Betterment 3,667,486$ Replacement Reserve 78,967,855 Designated Insurance 842,437 Designated New Supply Fund 6,381 Undesignated 5,019,513 Total $ 88,503,672 44 Notes To Financial Statements Year Ended June 30, 2024 7) DEFINED BENEFIT PENSION PLAN –Continued Benefits Provided The Plans’ provisions and benefits in effect at June 30, 2024 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 2024 8.00%7.50% Required Employer Contribution Rates 2024 22.07%22.07% Employees Covered The following employees were covered by the benefit terms for the Plan: Inactive Employees or Beneficiaries Currently Receiving Benefits 228 Inactive Employees Entitled to But Not Yet Receiving Benefits 126 Active Employees 137 Total 491 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. 45 Notes To Financial Statements Year Ended June 30, 2024 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, 2023 rolled forward to June 30, 2024 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, 2023 actuarial valuations were determined using the following actuarial assumptions: Actuarial Cost Method Entry-Age Actuarial Cost Method Actuarial Assumptions: Discount Rate 6.90% Inflation 2.50% 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 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. (2)The lesser of contract COLA or 2.30% until Purchasing Power Protection Allowance floor on purchasing power applies, 2.30% thereafter. 46 Notes To Financial Statements Year Ended June 30, 2024 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) 47 Notes To Financial Statements Year Ended June 30, 2024 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, 2024: Total Pension Plan Fiduciary Net Pension Liability Net Position Liability (Asset) Beginning Balance 165,738,046$139,786,951$ 25,951,095$ Changes in the Year: Service Cost 2,989,611 -2,989,611 Interest on the Total Pension Liability 11,457,149 -11,457,149 Changes in Benefit Terms 137,177 -137,177 Changes in Assumptions --- Difference Between Expected and Actual Experience 3,092,819 -3,092,819 Net Plan to Plan Resource Movement --- Contributions - Employer 5,458,992 (5,458,992) Contributions - Employees 1,112,562 (1,112,562) Net Investment Income 8,605,145 (8,605,145) Benefit Payments, Including Refunds of Employee Contributions (8,834,436) (8,834,436) - Administrative Expense -(102,793) 102,793 Other Miscellaneous Income (Expense)--- Net Changes 8,842,320 6,239,470 2,602,850 Ending Balance 174,580,366$146,026,421$ 28,553,945$ Increase ( Decrease) 48 Notes To Financial Statements Year Ended June 30, 2024 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, 2024, the District recognized pension expense of $8,369,481. At June 30, 2024, the District reported deferred outflows of resources and deferred inflows of resources related to pensions from the following services: 1% Decrease 5.90% Net Pension Liability 50,451,421$ Current Discount Rate 6.90% Net Pension Liability 28,553,945$ 1% Increase 7.90% Net Pension Liability/(Asset)10,280,385$ Deferred Outflows of Resources Pension contributions subsequent to measurement date 3,095,172$ Changes of assumptions 1,424,127 Differences between actual and expected experience 2,038,160 Net difference between projected and actual earnings on pension plan investments 6,722,157 Total 13,279,616$ 49 Notes To Financial Statements Year Ended June 30, 2024 7)DEFINED BENEFIT PENSION PLAN –Continued D)Pension Expenses and Deferred Outflows/Inflows of Resources Related to Pensions -Continued For fiscal year 2024, $3,095,172 reported as deferred outflows of resources related to contributions subsequent to the measurement date will be recognized as a reduction of the net pension liability in the fiscal year ended June 30, 2025. Other amounts reported as deferred outflows of resources and deferred inflows of resources related to pensions will be recognized as pension expense as follows: Under GASB 68, gains and losses related to changes in total pension liability and fiduciary net position are recognized in pension expense systematically over time. The first amortized amounts are recognized in pension expense for the year the gain or loss occurs. The remaining amounts are categorized as deferred outflows and deferred inflows of resources related to pensions and are to be recognized in future pension expense.The amortization period differs depending on the source of the gain or loss: Net difference between projected and actual earnings on pension plan investments 5-year straight-line amortization All other amounts Straight-line amortization over the expected average remaining service lifetime (EARSL) of all members that are provided with benefits (active, inactive, and retired) as of the beginning of the measurement period Fiscal Deferred Year Ended Outflow/(Inflows) June 30 of Resources 2025 3,802,044$ 2026 1,574,503 2027 4,617,258 2028 190,639 2029 - Thereafter - 50 Notes To Financial Statements Year Ended June 30, 2024 7)DEFINED BENEFIT PENSION PLAN –Continued E)Payable to the Pension Plan At June 30, 2024, the District reported a payable of $136,734 for the outstanding amount of contributions to the pension plan required for the year ended June 30, 2024. These payables are reflected in the accrued payroll liabilities on the Statement of Net Position. 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. 51 Notes To Financial Statements Year Ended June 30, 2024 8)OTHER POST EMPLOYMENT BENEFITS (OPEB) -Continued Employees Covered As of June 30, 2023 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, 2024, the District made cash contributions to the trust of $2,540,757 and had an estimated implied subsidy of $234,971, resulting in total payments of $2,775,728. Net OPEB Liability The District’s net OPEB liability was measured as of June 30, 2023 and the total OPEB liability used to calculate the net OPEB liability was determined by actuarial valuations dated June 30, 2023 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 137 Inactive Employees or Beneficiaries Currently Receiving Benefits 85 Inactive Employees Entitled to But Not Yet Received Benefits - Total 222 52 Notes To Financial Statements Year Ended June 30, 2024 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, 2023 actuarial valuation: Discount Rate The discount rate used to measure the total OPEB liability was 6.75% for the June 30, 2023 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 projects benefit payments to determine the total OPEB liability. Long-Term Target Expected Real Asset Class Allocation Rate of Return All Equities 59.00%7.545% All Fixed Income 25.00%4.250% Real Estate Investment Trust 8.00%7.250% All Commodities 3.00%7.545% Treasury Inflation Protected Securities (TIPS)5.00%3.000% 53 Notes To Financial Statements Year Ended June 30, 2024 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, 2024: 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, 2023: Total OPEB Plan Fiduciary Net OPEB Liability Net Position Liability (Asset) Beginning Balance 34,537,166$ 29,485,905$ 5,051,261$ Changes in the year: Service Cost 1,018,363 - 1,018,363 Interest on TOL/Return on FNP 2,324,644 1,969,238 355,406 Difference Between Expected and Actual Experience 5,942,003 - 5,942,003 Changes of Assumptions 41,042 - 41,042 Contributions - Employer - 1,214,348 (1,214,348) Benefit Payments (1,214,348) (1,214,348) - Administrative Expenses - (8,619) 8,619 Net Changes 8,111,704 1,960,619 6,151,085 Ending Balance 42,648,870$ 31,446,524$ 11,202,346$ Increase ( Decrease) Current 1% Decrease Discount Rate 1% Increase 2024 Net OPEB Liability (Asset) (2023 Measurement Date)17,012,011$ 11,202,346$ 6,410,368$ 54 Notes To Financial Statements Year Ended June 30, 2024 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, 2023: 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 2024 Net OPEB Liability (Asset) (2023 Measurement Date)5,739,269$ 11,202,346$ 17,964,377$ 55 Notes To Financial Statements Year Ended June 30, 2024 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, 2024, the District recognized OPEB expense of $1,196,786. As of the fiscal year ended June 30, 2024, the District reported deferred outflows and inflows of resources related to OPEB from the following sources: For fiscal year 2024, $2,775,728 reported as deferred outflows of resources related to contributions subsequent to the measurement date will be recognized as a reduction of the net OPEB liability in the fiscal year ended June 30, 2025. Other amounts reported as deferred outflows of resources and deferred inflows of resources related to pensions will be recognized as pension expense as follows: Deferred Outflows Deferred Inflows of Resources of Resources OPEB contributions subsequent to measurement date 2,775,728$ -$ Differences between expected and actual experience 7,311,607 - Changes in assumptions 35,261 (870,274) Net difference between projected and actual earnings on OPEB plan investments 2,083,516 - Total 12,206,112$ (870,274)$ Fiscal Deferred Year Ended Outflows/(Inflows) June 30, of Resources 2025 1,596,718$ 2026 1,413,558 2027 2,599,732 2028 1,150,488 2029 872,667 Thereafter 926,947 56 Notes To Financial Statements Year Ended June 30, 2024 9) OTHER NON-CURRENT LIABILITIES Other non-current liabilities for the year ended June 30, 2024, are as follows: 10) COMMITMENTS AND CONTINGENCIES Construction Commitments The District has commitments related to capital projects under construction with an estimated cost to complete of $8,376,884 at June 30, 2024. Litigation Certain claims, suits and complaints arising in the ordinary course of operation have been filed or are pending against the District. In the opinion of the staff and counsel, most of those matters are adequately covered by insurance, or if not so covered,are without merit or are of such kind, or involved such amounts, as would not have significant effect on the financial position or results of operations of the District if disposed of unfavorably. There is one case, see below, that could have a significant effect on the District’s financial position. In November 2015, a District ratepayer filed a lawsuit against the District (Coziahr v. Otay Water District, Superior Court of the State of California, County of San Diego, contending that the District’s water rates violated Article XIIID of the California Constitution (“Proposition 218”). The court subsequently certified the action as a class action on behalf of all single-family residential ratepayers who have received water service at any time after July 14, 2014. On March 4, 2021, the court issued a decision in favor of the plaintiffs holding its tiered water rates adopted in 2013 and 2017 for the following 5-year periods were not proportionate to the cost of service attributable to each customer’s parcel, as required by Proposition 218. Beginning Ending Due Within Balance Additions Deletions Balance One Year Compensated absences 3,485,451$ 1,315,897$ (1,548,250)$ 3,253,098$ 325,309$ Customer credits 274,918 9,425 (20,187) 264,156 - Reimbursement agreements 356,644 - - 356,644 - Accrued litigation - 27,000,000 - 27,000,000 - Total 4,117,013$ 1,325,322$ (1,568,437)$ 30,873,898$ 325,309$ 57 Notes To Financial Statements Year Ended June 30, 2024 10)COMMITMENTS AND CONTINGENCIES –Continued On June 15, 2022, the court issued a Statement of Decision in the case. The Statement of Decision adopts a methodology for computing overcharges to ratepayers in the class based on the court’s earlier finding that the District’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. Applying its methodology, the court states that the overcharges to ratepayers through June 2021 is estimated to be approximately $18,105,256, with an approximate additional $208,762 of overcharges plus interest accruing each month subsequent to June 2021 until the District changes its rates to be consistent with Proposition 218. The District changed its rates effective January 2023. The District’s position is that the Court decision is inconsistent with the Constitution, case law, and with recently-enacted bills that clarify both that rates based on peaking factors like Otay’s rates are valid (AB 1824) and that challengers are not entitled to refunds for Proposition 218 rate challenges (SB 1072). 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. The estimated potential liability to the District, if the court were to award attorneys fees and damages, may be as high as $27M. 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, 2024, 1,750 EDUs had been relinquished and refunded, 15,105 EDUs had been connected, and 1,012 EDUs have neither been relinquished nor connected. 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. 58 Notes To Financial Statements Year Ended June 30, 2024 10)COMMITMENTS AND CONTINGENCIES –Continued As of June 30, 2024, none of the outstanding developer projects had been completed. It is anticipated that the District will be liable for an amount not to exceed $685,000 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: Total limits of $5 million combined single limit at $5 million per occurrence, with excess aggregate coverage at $50 million subject to the following deductibles: $50,000 per occurrence for third party general liability property damage; $50,000 per occurrence for third party auto liability property damage; 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 effective July 1, 2023. Property Loss: Replacement cost, for property on file, paid on an actual cash value basis, to a combined total of $372 million per occurrence, subject to a $25,000 deductible per occurrence, effective July 1, 2023. Boiler and Machinery: Replacement costs up to $100 million per occurrence, subject to a $25,000 deductible, effective July 1, 2023. 59 Notes To Financial Statements Year Ended June 30, 2024 11)RISK MANAGEMENT –Continued Comprehensive and Collision: Deductibles of $1,000, as elected; ACV limits; fully self-funded by ACWA, effective July 1, 2023. 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, 2023. Cyber Coverage: $5 million Annual Program-Wide Aggregate Limit of Liability and $3 million maximum for each Insured/Member for Information Security & Privacy Liability. The policy includes a $100,000 deductible per claim,effective July 1, 2023. Fiduciary Coverage: $2 million aggregate limit of liability, subject to $150,000 deductible.Per incident limits of $1.5 million for HIPPA and HITECH fines/penalties and $250,000 for all else. 12) LEASES RECEIVABLE The District has entered into 32 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, 2024, the lease receivable is $46,269,966 and deferred inflows of resources is $43,410,817. The District recognized $1,619,301 of lease revenue during the fiscal year. 13)SEGMENT INFORMATION The District has issued Water and Wastewater Revenue Bonds in the previous fiscal years to finance certain capital improvements. While water and wastewater services are accounted for jointly in these financial statements, the investors in the Water Revenue Bonds rely solely on the revenues of the water services for repayment and the Wastewater Revenue Bonds solely on the revenues of the wastewater services for repayment. Summary of financial information for the water and wastewater services is presented for June 30, 2024 on the following pages: 60 Notes To Financial Statements Year Ended June 30, 2024 13) SEGMENT INFORMATION – Continued Water Wastewater Services Services Total Assets Cash and Investments 112,544,293$ 7,131,996$ 119,676,289$ Accounts Receivable, Net 16,349,717 221,071 16,570,788 Other Current Assets 5,088,633 289,250 5,377,883 Leases Receivable 46,269,966 - 46,269,966 Capital Assets 409,702,657 27,184,503 436,887,160 Total Assets 589,955,266 34,826,820 624,782,086 Deferred Outflows of Resources Deferred Actuarial Pension Costs 12,812,557 467,059 13,279,616 Deferred Actuarial OPEB Costs 11,685,281 520,831 12,206,112 Total Deferred Outflows of Resources 24,497,838 987,890 25,485,728 Liabilities Accounts Payable 16,790,220 52,266 16,842,486 Other Miscellaneous Liabilities 6,137,496 1,205,003 7,342,499 Other Current Liabilities 12,102,418 103,386 12,205,804 Revenue Bonds 86,606,906 2,823,856 89,430,762 Lease Payable 671,758 - 671,758 Subscription-Based IT Payable 4,914,393 - 4,914,393 Net Pension Liability 27,601,030 952,915 28,553,945 Net OPEB Liability 10,722,665 479,681 11,202,346 Other Non-current Liabilities 30,548,589 - 30,548,589 Total Liabilities 196,095,475 5,617,107 201,712,582 Deferred Inflows of Resources Deferred Actuarial OPEB Costs 843,812 26,462 870,274 Deferred Actuarial Pension Costs 21,458 (21,458) - Deferred Inflows from Leases 43,410,817 - 43,410,817 Total Deferred Inflows of Resources 44,276,087 5,004 44,281,091 Net Position Net Investment in Capital Assets 311,764,400 24,286,108 336,050,508 Restricted for Debt Service 3,636,078 - 3,636,078 Restricted for Capital Assets 3,083,883 - 3,083,883 Unrestricted 55,597,181 5,906,491 61,503,672 Total Net Position 374,081,542$ 30,192,599$ 404,274,141$ June 30, 2024 Condensed Statement of Net Position 61 Notes To Financial Statements Year Ended June 30, 2024 13) SEGMENT INFORMATION – Continued Water Wastewater Services Services Total Operating Revenues Water Sales 105,736,843$ -$ 105,736,843$ Wastewater Revenue - 3,494,312 3,494,312 Connection and Other Fees 3,253,313 665 3,253,978 Total Operating Revenues 108,990,156 3,494,977 112,485,133 Operating Expenses Cost of Water Sales 77,807,009 - 77,807,009 Wastewater - 2,400,881 2,400,881 Administrative and General 32,717,662 - 32,717,662 Depreciation 17,163,463 1,113,029 18,276,492 Total Operating Expenses 127,688,134 3,513,910 131,202,044 Operating Income (Loss)(18,697,978) (18,933) (18,716,911) Non-Operating Revenues (Expenses) Investment Earnings (Losses)6,269,121 124,402 6,393,523 Taxes and Assessments 5,777,012 - 5,777,012 Availability Charges 690,392 51,313 741,705 Gain (Loss) on Sale of Capital Assets (723,389) (1,671) (725,060) Rents and Leases 2,083,669 - 2,083,669 Miscellaneous Revenues 1,894,533 1,582 1,896,115 Donations (103,200) - (103,200) Interest Expense (4,050,569) (87,046) (4,137,615) Miscellaneous Expenses (27,463,732) (14,680) (27,478,412) Total Non-operating Revenues (Expenses)(15,626,163) 73,900 (15,552,263) Income (Loss) Before Capital Contributions and Transfers (34,324,141) 54,967 (34,269,174) Capital Contributions 7,432,482 35,804 7,468,286 Change in Net Position (26,891,659) 90,771 (26,800,888) Total Net Position, Beginning 400,973,201 30,101,828 431,075,029 Total Net Position, Ending 374,081,542$ 30,192,599$ 404,274,141$ Condensed Statement of Revenues, Expenses and Changes in Net Pension Year Ended June 30, 2024 62 Notes To Financial Statements Year Ended June 30, 2024 13)SEGMENT INFORMATION –Continued 14) Subsequent Event Effective September 1, 2024, the District created an 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. Water Wastewater Services Services Total Net Cash Provided/(Used) by: Operating Activities 3,282,557$ 1,459,761$ 4,742,318$ Non-capital and Related Financing Activities 6,478,761 51,313 6,530,074 Capital and Related Financing Activities (6,801,389) (297,486) (7,098,875) Investing Activities 29,316,260 75,443 29,391,703 Net Increase(Decrease) in Cash and Cash Equivalents 32,276,189 1,289,031 33,565,220 Cash and Cash Equivalents, Beginning 40,988,806 5,842,965 46,831,771 Cash and Cash Equivalents, Ending 73,264,995$ 7,131,996$ 80,396,991$ For the Year Ended June 30, 2024 Condensed Statement of Cash Flows 63 Schedule of Changes in the Net OPEB Liability and Related Ratios Last Ten Years (1) June 30, 2024 Measurement Period: June 30 2023 2022 2021 2020 2019 2018 2017 Total OPEB Liability Service Cost 1,018,363$ 991,108$ 755,756$ 735,529$ 757,725$ 735,655$ 687,528$ Interest on the Total OPEB Liability 2,324,644 2,189,619 2,077,446 1,915,358 1,970,613 1,864,967 1,764,343 Actual and Expected Experience Difference 5,942,003 254,888 2,595,855 1,151,927 (2,029,118) - - Changes in Assumptions 41,042 - (1,557,334) - (345,110) - - Changes in Benefit Terms - - - - - - - Benefit Payment (1,214,348) (1,428,491) (1,201,678) (1,120,146) (1,141,344) (1,085,586) (1,039,420) Net Change in Total OPEB Liability 8,111,704 2,007,124 2,670,045 2,682,668 (787,234) 1,515,036 1,412,451 Total OPEB Liability - Beginning 34,537,166 32,530,042 29,859,997 27,177,329 27,964,563 26,449,527 25,037,076 Total OPEB Liability - Ending (a)42,648,870$ 34,537,166$ 32,530,042$ 29,859,997$ 27,177,329$ 27,964,563$ 26,449,527$ Plan Fiduciary Net Position Contributions - Employer 1,214,348$ 127,444$ 807,867$ 1,011,358$ 2,206,363$ 2,202,004$ 2,284,420$ Net Investment Income 1,969,238 (4,739,093) 7,880,863 983,790 1,595,092 1,734,626 2,011,985 Benefit Payments (1,214,348) (1,428,491) (1,201,678) (1,120,146) (1,141,344) (1,085,586) (1,039,420) Administrative Expenses (8,619) (9,034) (10,811) (13,514) (12,299) (11,784) (10,167) Other Expenses - - - - - - - Net Change in Plan Fiduciary Net Position 1,960,619 (6,049,174) 7,476,241 861,488 2,647,812 2,839,260 3,246,818 Plan Fiduciary Net Position - Beginning 29,485,905 35,535,079 28,058,838 27,197,350 24,549,538 21,739,035 18,492,217 Plan Fiduciary Net Position - Ending (b)31,446,524$ 29,485,905$ 35,535,079$ 28,058,838$ 27,197,350$ 24,578,295$ 21,739,035$ Net OPEB Liability/(Asset) - Ending (a)-(b)11,202,346$ 5,051,261$ (3,005,037)$ 1,801,159$ (20,021)$ 3,386,268$ 4,710,492$ Plan Fiduciary Net Position as a Percentage of the Total OPEB Liability 73.73% 85.37% 109.24% 94.00% 100.10% 87.80% 82.20% Covered-Employee Payroll 14,393,757$ 14,054,264$ 14,006,918$ 13,538,959$ 13,176,602$ 12,677,000$ 12,513,000$ Net OPEB Liability/(Asset) as a Percentage of Covered-Employee Payroll 77.83% 35.94%-21.45%13.30%-0.20%26.90% 37.60% Notes to Schedule (1)Historicalinformation is required only for measurement periods for which GASB75 is applicable.Future years’information will be displayed upto10 years as information becomes available.Contributions are determined by an actuarial valuation based on eligible participants’estimated medical and dental benefits. 64 Schedule of Contributions Last Ten Years (1) June 30, 2024 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 ---14,054,264 0.00% 2023 -(1,394,881)(1,394,881) 14,393,757 9.69% 2024 1,139,661 (2,775,728)(1,636,067) 14,757,192 18.81% 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 Market 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 2024 were from the June 30, 2023 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. 65 Schedule of Changes in the Net Pension Liability and Related Ratios Last Ten Years June 30, 2024 Measurement Period: June 30 2023 2022 2021 2020 2019 Total Pension Liability Service Cost 2,989,611$ 2,994,291$ 2,662,845$ 2,623,208$ 2,586,911$ Interest 11,457,149 10,864,205 10,489,284 10,043,778 9,638,674 Changes in Benefit Terms 137,177 - - - - Changes in Assumptions - 4,984,447 - - - Difference Between Expected and actual Experience 3,092,819 174,717 705,426 260,337 1,183,213 Benefit Payments, including Refunds of Employee Contributions (8,834,436) (8,151,116) (7,304,947) (7,017,816) (6,658,719) Net Change in Total Pension Liability 8,842,320 10,866,544 6,552,608 5,909,507 6,750,079 Total Pension Liability - Beginning 165,738,046 154,871,502 148,318,894 142,409,387 135,659,308 Total Pension Liability - Ending (a)174,580,366$ 165,738,046$ 154,871,502$ 148,318,894$ 142,409,387$ Plan Fiduciary Net Position Net Plan to Plan Resource Movement -$ -$ -$ -$ -$ Contributions - Employer 5,458,992 3,928,187 3,945,147 2,437,119 36,706,983 Contributions - Employee 1,112,562 1,099,592 1,095,898 1,055,769 1,019,255 Net Investment Income 8,605,145 (11,584,615) 28,707,870 6,185,108 7,516,686 Benefit Payments, Including Refunds of Employee Contributions (8,834,436) (8,151,116) (7,304,947) (7,017,816) (6,658,719) Administrative Expenses (102,793) (96,301) (128,139) (177,337) (62,278) Other Changes in Fiduciary Net Position - - - - 203 Net Change in Plan Fiduciary Net Position 6,239,470 (14,804,253) 26,315,829 2,482,843 38,522,130 Plan Fiduciary Net Position - Beginning 139,786,951 154,591,204 128,275,375 125,792,532 87,270,402 Plan Fiduciary Net Position - Ending (b)146,026,421$ 139,786,951$ 154,591,204$ 128,275,375$ 125,792,532$ Plan Net Pension Liability/(Asset) - Ending (a)-(b)28,553,945$ 25,951,095$ 280,298$ 20,043,519$ 16,616,855$ Plan Fiduciary Net Position as a Percentage of the Total Pension Liability 83.64%84.34%99.82%86.49%88.33% Covered Payroll 14,539,529$ 14,148,052$ 13,768,586$ 13,383,715$ 12,892,655$ Plan Net Pension Liability/(Asset) as a Percentage of Covered Payroll 196.39%183.43%2.04%149.76%128.89% 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. In 2022,SB 1168 increased the standard retiree lump sum death benefit from $500 to $2,000 for any death occurring on or after July 1, 2023. The impact, if any, is included in the changes of benefit terms. Changes in Assumptions:There were no assumption changes in 2023.Effective with the June 30, 2021 valuation date (June 30, 2022 measurement date),the accounting discount rate was reduced from 7.15%to 6.90%.In determining the long-term expected rate of return, CalPERS took into account long-term market return expectations as well as the expected pension fund cash flows.In addition,demographic assumptions and the price inflation assumption were changed in accordance with the 2021 CalPERS Experience Study and Review of Actuarial Assumptions.The accounting discount rate was 7.15%for measurement date June 30, 2017 through June 30, 2021,7.65%for measurement dates June 30, 2015 through June 30, 2016, and 7.50% for measurement date June 30, 2014. 66 Schedule of Changes in the Net Pension Liability and Related Ratios Last Ten Years June 30, 2024 Measurement Period: June 30 2018 2017 2016 2015 2014 Total Pension Liability Service Cost 2,528,271$ 2,556,902$ 2,298,617$ 2,250,860$ 2,330,709$ Interest 9,168,092 8,836,284 8,575,275 8,229,312 7,907,915 Changes in Benefit Terms - - - - - Changes in Assumptions (1,312,634) 7,308,486 - (1,996,819) - Difference Between Expected and actual Experience 461,917 (1,208,593) (613,440) (981,200) - Benefit Payments, including Refunds of Employee Contributions (5,995,949) (5,779,040) (5,448,218) (5,288,251) (4,885,406) Net Change in Total Pension Liability 4,849,697 11,714,039 4,812,234 2,213,902 5,353,218 Total Pension Liability - Beginning 130,809,611 119,095,572 114,283,338 112,069,436 106,716,218 Total Pension Liability - Ending (a)135,659,308$ 130,809,611$ 119,095,572$ 114,283,338$ 112,069,436$ Plan Fiduciary Net Position Net Plan to Plan Resource Movement (203)$ -$ -$ -$ -$ Contributions - Employer 4,441,517 4,105,810 3,819,770 3,557,098 3,137,174 Contributions - Employee 1,015,008 1,014,329 1,010,337 1,007,023 1,074,954 Net Investment Income 6,949,676 8,149,097 369,214 1,601,760 10,874,999 Benefit Payments, Including Refunds of Employee Contributions (5,995,949) (5,779,040) (5,448,218) (5,288,251) (4,885,406) Administrative Expenses (126,575) (109,029) (45,185) (83,511) - Other Changes in Fiduciary Net Position (240,367) - - - - Net Change in Plan Fiduciary Net Position 6,043,107 7,381,167 (294,082) 794,119 10,201,721 Plan Fiduciary Net Position - Beginning 81,227,295 73,846,128 74,140,210 73,346,091 63,144,370 Plan Fiduciary Net Position - Ending (b)87,270,402$ 81,227,295$ 73,846,128$ 74,140,210$ 73,346,091$ Plan Net Pension Liability/(Asset) - Ending (a)-(b)48,388,906$ 49,582,316$ 45,249,444$ 40,143,128$ 38,723,345$ Plan Fiduciary Net Position as a Percentage of the Total Pension Liability 64.33%62.10%62.01%64.87%65.45% Covered Payroll 12,969,485$ 12,829,415$ 12,767,963$ 12,451,513$ 12,276,578$ Plan Net Pension Liability/(Asset) as a Percentage of Covered Payroll 373.10%386.47%354.40%322.40%315.42% Notes to Schedule: In 2022,SB 1168 increased the standard retiree lump sum death benefit from $500 to $2,000 for any death occurring on or after July 1, 2023. The impact, if any, is included in the changes of benefit terms. Changes in Assumptions:There were no assumption changes in 2023.Effective with the June 30, 2021 valuation date (June 30, 2022 measurement date),the accounting discount rate was reduced from 7.15%to 6.90%.In determining the long-term expected rate of return,CalPERS took into account long-term market return expectations as well as the expected pension fund cash flows.In addition, demographic assumptions and the price inflation assumption were changed in accordance with the 2021 CalPERS Experience Study and Review of Actuarial Assumptions.The accounting discount rate was 7.15%for measurement date June 30, 2017 through June 30, 2021, 7.65% for measurement dates June 30, 2015 through June 30, 2016, and 7.50% for measurement date June 30, 2014. Changes in Benefit Terms:The figures above generally include any liability impact that may have resulted from voluntary benefit changes that occurred on or before the Measurement Date.However,offers of Two Years Additional Service Credit (a.k.a.Golden Handshakes) that occurred after the Valuation Date are not included in the figures above,unless the liability impact is deemed to be material by the plan actuary. 67 Schedule of Plan Contributions Last Ten Years June 30, 2024 Actuarially Determined Contributions in Contribution Covered-Contributions as a Fiscal Contribution Relation to the Deficiency Employee Percentage of Covered- Year (ADC)(1)ADC(1)(Excess)Payroll(2)Employee Payroll(2) 2015 3,557,098$ (3,557,098)$ -$ 12,451,513$ 28.57% 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% 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 Market 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 2023-24 were from the June 30, 2021 public agency valuations. Also note, that some of the data from prior years were updated with the most current available information. 68 Report on Internal Control Over Financial Reporting and on Compliance and Other Matters Based on an Audit of Financial Statements Performed in Accordance with Government Auditing Standards Board of Directors Otay Water District Spring Valley, California Independent Auditor’s Report We have audited, in accordance with the auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards issued by the Comptroller General of the United States, the financial statements of Otay Water District (“the District”), as of and for the year ended June 30, 2024, and the related notes to the financial statements, which collectively comprise the District’s basic financial statements, and have issued our report thereon dated October 18,2024. Report on Internal Control Over Financial Reporting In planning and performing our audit of the financial statements, we considered the District's internal control over financial reporting (internal control) as a basis for designing audit procedures that are appropriate in the circumstances for the purpose of expressing our opinions on the financial statements, but not for the purpose of expressing an opinion on the effectiveness of the District’s internal control. Accordingly, we do not express an opinion on the effectiveness of the District’s internal control. A deficiency in internal control exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, misstatements on a timely basis. A material weakness is a deficiency, or a combination of deficiencies, in internal control, such that there is a reasonable possibility that a material misstatement of the entity’s financial statements will not be prevented or detected and corrected on a timely basis. A significant deficiency is a deficiency, or a combination of deficiencies, in internal control that is less severe than a material weakness, yet important enough to merit attention by those charged with governance. Our consideration of internal control was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control that might be material weaknesses or significant deficiencies. Given these limitations, during our audit we did not identify any deficiencies in internal control that we consider to be material weaknesses. However, material weaknesses or significant deficiencies may exist that have not been identified. Attachment C Report on Compliance and Other Matters As part of obtaining reasonable assurance about whether the District's financial statements are free from material misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements, noncompliance with which could have a direct and material effect on the financial statements.However, providing an opinion on compliance with those provisions was not an objective of our audit, and accordingly, we do not express such an opinion. The results of our tests disclosed no instances of noncompliance or other matters that are required to be reported under Government Auditing Standards. Purpose of this Report The purpose of this report is solely to describe the scope of our testing of internal control and compliance and the results of that testing, and not to provide an opinion on the effectiveness of the District’s internal control or on compliance. This report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the District’s internal control and compliance. Accordingly, this communication is not suitable for any other purpose. Irvine, California October 25, 2024 To the Board of Directors Otay Water District Spring Valley, California We have audited the financial statements of the Otay Water District (“the District”)as of and for the year ended June 30, 2024 and have issued our report thereon dated October 18,2024. Professional standards require that we advise you of the following matters relating to our audit. Our Responsibility in Relation to the Financial Statement Audit As communicated in our engagement letter dated May 25, 2024, our responsibility, as described by professional standards, is to form and express an opinion about whether the financial statements that have been prepared by management with your oversight are presented fairly, in all material respects, in accordance with accounting principles generally accepted in the United States of America. Our audit of the financial statements does not relieve you or management of your respective responsibilities. Our responsibility, as prescribed by professional standards, is to plan and perform our audit to obtain reasonable, rather than absolute, assurance about whether the financial statements are free of material misstatement. An audit of financial statements includes consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control over financial reporting. Accordingly, as part of our audit, we considered the internal control of the District solely for the purpose of determining our audit procedures and not to provide any assurance concerning such internal control. We are also responsible for communicating significant matters related to the audit that are, in our professional judgment, relevant to your responsibilities in overseeing the financial reporting process. However, we are not required to design procedures for the purpose of identifying other matters to communicate to you. Planned Scope and Timing of the Audit We conducted our audit consistent with the planned scope and timing we previously communicated to you. Compliance with All Ethics Requirements Regarding Independence The engagement team, others in our firm, as appropriate and our firm, have complied with all relevant ethical requirements regarding independence under the American Institute of Certified Public Accountants (“AICPA”) independence standards, contained in the Code of Professional Conduct. We identified self-review threats to independence as a result of non-attest services provided. Those non-attest services included the preparation of the financial statements. To mitigate the risk,management has compared the draft financial statements and footnotes to the underlying accounting records to verify accuracy and has reviewed a disclosure checklist to ensure footnotes are complete and accurate. Attachment D Additionally, we utilize a quality control reviewer to perform a second review of the financial statements. We believe these safeguards are sufficient to reduce the independence threats to an acceptable level. Significant Risks Identified We have identified the addition of a new subscription-based information technology arrangement (SBITA)as a significant risk due to the materiality of the arrangement and the newness of the GASB 96 accounting standard implemented in the prior year. As a result, we performed additional testing outside of our standard audit approach to ensure the transaction was recorded correctly. Qualitative Aspects of the Entity’s Significant Accounting Practices Significant Accounting Policies Management has the responsibility to select and use appropriate accounting policies. A summary of the significant accounting policies adopted by the District is included in Note 1 to the financial statements. No matters have come to our attention that would require us, under professional standards, to inform you about (1) the methods used to account for significant unusual transactions and (2) the effect of significant accounting policies in controversial or emerging areas for which there is a lack of authoritative guidance or consensus. Significant Accounting Estimates Accounting estimates are an integral part of the financial statements prepared by management and are based on management’s current judgments.There have been no initial selection of accounting policies and no changes in significant accounting policies or their application during 2024.Those judgments are normally based on knowledge and experience about past and current events and assumptions about future events. Certain accounting estimates are particularly sensitive because of their significance to the financial statements and because of the possibility that future events affecting them may differ markedly from management’s current judgments. The most sensitive accounting estimates affecting the financial statements are: Management’s estimate of which capital projects represent ordinary maintenance activities necessary to keep an asset operational for its originally intended useful life versus significant improvement, replacement, and life extending projects that should be capitalized as additions to capital assets is based on management’s knowledge of the assets and their useful lives. We evaluated the key factors and assumptions used to develop the amounts added to capital assets in determining that it is reasonable in relation to the financial statements taken as a whole. Management’s estimate of transactions related to net pension liabilities based on actuarial information. We evaluated the key factors and assumptions used to develop the amounts by the actuary and determined that it is reasonable in relation to the financial statements taken as a whole. Management’s estimate of transactions related to net OPEB liabilities based on actuarial information. We evaluated the key factors and assumptions used to develop the amounts by the actuary and determined that it is reasonable in relation to the financial statements taken as a whole. Financial Statement Disclosures Certain financial statement disclosures involve significant judgment and are particularly sensitive because of their significance to financial statement users. The most sensitive disclosures affecting the District’s financial statements were: The disclosure of pensions in note 7 of the financial statements. The disclosure of OPEB in note 8 to the financial statements. The financial statement disclosures are neutral, consistent, and clear. Significant Unusual Transactions For purposes of this communication, professional standards require us to communicate to you significant unusual transactions identified during our audit.There were no significant unusual transactions identified as a result of our audit procedures. Identified or Suspected Fraud We have not identified or have obtained information that indicates that fraud may have occurred. Significant Difficulties Encountered during the Audit We encountered no significant difficulties in dealing with management relating to the performance of the audit. Uncorrected and Corrected Misstatements For purposes of this communication, professional standards also require us to accumulate all known and likely misstatements identified during the audit, other than those that we believe are trivial, and communicate them to the appropriate level of management. Further, professional standards require us to also communicate the effect of uncorrected misstatements related to prior periods on the relevant classes of transactions, account balances or disclosures, and the financial statements as a whole and each applicable opinion unit.There were no uncorrected misstatements that we identified as a result of our audit procedures. In addition, professional standards require us to communicate to you all material, corrected misstatements that were brought to the attention of management as a result of our audit procedures. There were no material misstatements that we identified as a result of our audit procedures. Disagreements with Management For purposes of this letter, professional standards define a disagreement with management as a matter, whether or not resolved to our satisfaction, concerning a financial accounting, reporting, or auditing matter, which could be significant to the District’s financial statements or the auditor’s report. No such disagreements arose during the course of the audit. Circumstances that Affect the Form and Content of the Auditor’s Report For purposes of this letter, professional standards require that we communicate any circumstances that affect the form and content of our auditor’s report. There were none. Representations Requested from Management We have requested certain written representations from management, which are included in the attached letter dated October 18, 2024. Management’s Consultations with Other Accountants In some cases, management may decide to consult with other accountants about auditing and accounting matters. Management informed us that, and to our knowledge, there were no consultations with other accountants regarding auditing and accounting matters. Other Significant Matters, Findings, or Issues In the normal course of our professional association with the District, we generally discuss a variety of matters, including the application of accounting principles and auditing standards, significant events or transactions that occurred during the year,operating and regulatory conditions affecting the entity, and operational plans and strategies that may affect the risks of material misstatement. None of the matters discussed resulted in a condition to our retention as the District’s auditors. Restriction on Use This report is intended solely for the information and use of the Board of Directors and management of the District and is not intended to be and should not be used by anyone other than these specified parties. Irvine, California October 25, 2024 Otay Water District Spring Valley, California INDEPENDENT ACCOUNTANT’S REPORT We have performed the procedures enumerated below, in reviewing the Otay Water District’s (“the District”) compliance with the requirements of the Investment Policy as such requirements apply to the Investments of the District for the period July 1, 2023, through June 30, 2024. The District is responsible for compliance with the requirements as noted in the referenced Investment Policies. The District has agreed to acknowledge that the procedures performed are appropriate to meet the intended purpose of determining compliance by the District with respect to the Investment Policy for the period July 1, 2023, through June 30, 2024.This report may not be suitable for any other purpose. The procedures performed may not address all the items of interest to a user of this report and may not meet the needs of all users of this report and, as such, users are responsible for determining whether the procedures performed are appropriate for their purposes. The procedures performed, and the results of those procedures are as follows: 1.Obtain a copy of the District’s investment policy and determine that it is in effect for the fiscal year ended June 30, 2024. Results:No exceptions were noted as a result of applying the above procedure. 2.Select 4 investments held at year end and determine if they are allowable investments under the District’s Investment Policy. Results:No exceptions were noted as a result of applying the above procedure. 3.For the four investments selected in #2 above, determine if they are held by a third-party custodian designated by the District. Results:No exceptions were noted as a result of applying the above procedure. 4.Confirm the par or original investment amount and market value for the four investments selected above with the custodian or issuer of the investments. Results:No exceptions were noted as a result of applying the above procedure. 5.Select two investment earnings transactions that took place during the year and recompute the earnings to determine if the proper amount was received. Results:No exceptions were noted as a result of applying the above procedure. Attachment E Otay Water District Spring Valley, California Page 2 6. Trace amounts received for transactions selected at #5 above into the District’s bank accounts. Results:No exceptions were noted as a result of applying the above procedure. 7. Select five investment transactions (buy, sell, trade or maturity) occurring during the year under review and determine that the transactions are permissible under the District’s investment policy. Results:No exceptions were noted as a result of applying the above procedure. 8. Review the supporting documents for the five investments selected at #7 above to determine if the transactions were appropriately recorded into the District’s general ledger. Results:No exceptions were noted as a result of applying the above procedure. We were engaged by Otay Water District to perform this agreed-upon procedures engagement and conducted our engagement in accordance with attestation standards established by the American Institute of Certified Public Accountants. We were not engaged to and did not conduct an examination or review engagement, the objective of which would be the expression of an opinion or conclusion, respectively, on the District’s accounting records. Accordingly, we do not express such an opinion or conclusion. Had we performed additional procedures other matters might have come to our attention that would have been reported to you. We are required to be independent of the District and to meet our other ethical responsibilities in accordance with the relevant ethical requirement related to our agreed-upon procedures engagement. This report is intended solely for the information and use of management of Otay Water District and is not intended to be and should not be used by anyone other than those specified parties. Irvine, California October 25, 2024 OTAY WATER DISTRICT AUDIT RESULT FISCAL YEAR ENDED JUNE 30, 2024 November 6, 2024 Attachment F Audit Reports 2 ❑Basic Financial Statements ❑Unmodified opinion will be dated October 25, 2024 ❑Financial statements are consistent with prior year and presented in accordance with generally accepted accounting principles ❑Government Auditing Standards Opinion ❑Letter to Those in Governance ❑Agreed-Upon Procedures Report over Investments Audit Results 3 ❑Finance staff was prepared for the audit ❑No material journal entries detected as a result of the audit procedures ❑Noted no instances of noncompliance with laws and regulations that are direct and material to the financial statements ❑No material weaknesses or significant deficiencies in internal controls Areas of Audit Focus 4 Contract Review and Compliance with Policies Review of new SBITA agreement Questions? Shannon Ayala | Partner Davis Farr LLP | 1903 Wright Place, Suite 280 |Carlsbad, CA 92008 Phone: Direct:760.298.5872 | Email:sayala@davisfarr.com STAFF REPORT TYPE MEETING: Regular Board Meeting MEETING DATE: November 6, 2024 SUBMITTED BY: Tita Ramos-Krogman, District Secretary W.O./G.F. NO: DIV. NO. APPROVED BY: Tita Ramos-Krogman, District Secretary Jose Martinez, General Manager SUBJECT: Board of Directors 2024 and 2025 Calendars of Meetings GENERAL MANAGER’S RECOMMENDATION: At the request of the Board, the attached Board of Director’s meeting calendars for 2024 and 2025 are being presented for discussion. PURPOSE: This staff report is being presented to provide the Board the opportunity to review the 2024 and 2025 Board of Director’s meeting calendars and amend the schedules as needed. COMMITTEE ACTION: N/A ANALYSIS: The Board requested that this item be presented at each meeting so they may have an opportunity to review the Board meeting calendar schedule and amend it as needed. STRATEGIC GOAL: N/A FISCAL IMPACT: None. LEGAL IMPACT: None. Attachment: Calendar of Meetings for 2024 and 2025 AGENDA ITEM 10b Board of Directors, Workshops and Committee Meetings 2024 Regular Board Meetings: Special Board or Committee Meetings (3rd Wednesday of Each Month or as Noted) January 3, 2024 February 7, 2024 March 6, 2024 April 3, 2024 May 1, 2024 June 5, 2024 July 3, 2024 August 7, 2024 September 4, 2024 October 2, 2024 November 6, 2024 December 4, 2024 January 17, 2024 February 21, 2024 March 20, 2024 April 18, 2024 May 16, 2024 June 19, 2024 July 17, 2024 August 14, 2024 September 18, 2024 October 16, 2024 November 20, 2024 December 18, 2024 Board of Directors, Workshops and Committee Meetings 2025 Regular Board Meetings: Special Board or Committee Meetings (3rd Wednesday of Each Month or as Noted) January 8, 2025 February 5, 2025 March 5, 2025 April 2, 2025 May 7, 2025 June 4, 2025 July 2, 2025 August 6, 2025 September 3, 2025 October 1, 2025 November 5, 2025 December 3, 2025 January 15, 2025 February 19, 2025 March 19, 2025 April 16, 2025 May 21, 2025 June 18, 2025 July 16, 2025 August 20, 2025 September 17, 2025 October 15, 2025 November 19, 2025 December 17, 2025 1 STAFF REPORT TYPE MEETING: Regular Board MEETING DATE: November 6, 2024 SUBMITTED BY: Eileen Salmeron, Communications Assistant PROJECT: Various DIV. NO. All APPROVED BY: Tenille M. Otero, Communications Officer Jose Martinez, General Manager SUBJECT: Social Media, Mobile Application, and Website Analytics Update GENERAL MANAGER’S RECOMMENDATION: No recommendation. This is an informational item only. COMMITTEE ACTION: See Attachment A. PURPOSE: To provide the Board with an update on the Otay Water District’s social media, mobile application, and website analytics. ANALYSIS: The District’s communications staff uses online services, including social media, a mobile application, and the website to share the latest news with its customers and the public. Staff also manages and monitors the District’s social media presence and remains current with evolving online trends. Social media engagement fosters interaction between the public and public agencies, reaching demographics that do not frequently consume traditional media. Through social media, the District provides up-to-date information about water-related programs, projects, events, local and state news, and more. Additionally, social media helps the AGENDA ITEM 11 2 District promote transparency, connect with its audience, and respond to its needs. It is also an essential tool for communicating to the public during emergencies. Staff also manages the District’s website and the “Make Every Drop Count” mobile application. Attachment B includes the social media, mobile application, and website analytics for fiscal year 2024. Staff uses these tools and monitors them and other technologies to stay current with evolving technology and enhance customer satisfaction. Social Media The District’s social media presence, online audience, and stakeholder engagement have consistently increased. Staff maximizes the District’s online reach to promote water education, career opportunities, conservation programs, operational efficiencies, capital improvement projects, and other District programs. Staff increases its social media followers and engagement by creating captivating visual content, tailoring it to specific platforms, and collaborating with water agencies and organizations to launch water-related campaigns and programs. The District uses the following social media platforms: •YouTube – Joined November 2010 •X (formerly Twitter) – Joined February 2011 •Facebook – Joined November 2011 •Nextdoor – Joined July 2016 •LinkedIn – Joined August 2017 •Instagram – Joined November 2018 The social media analytics report in Attachment B presents the total number of impressions, engagements, and follower growth during fiscal year 2024. It also highlights the most popular posts published during that period. Facebook: From June 30, 2023, to June 30, 2024, its Facebook followers increased by 3.58%, from 727 to 753. The District is among the top five retail water agencies in the San Diego region with the most Facebook followers. X: From June 30, 2023, to June 30, 2024, its X followers increased by 2.41%, from 2,245 to 2,299. The District is the top retail water agency in the San Diego region with the most X followers. LinkedIn: From June 30, 2023, to June 30, 2024, its LinkedIn followers increased by 13.66%, from 1,003 to 1,140. The District is 3 the top retail water agency in the San Diego region with the most LinkedIn followers. Instagram: From June 30, 2023, to June 30, 2024, the District's Instagram followers increased by 13.84%, from 1,113 to 1,267. With the most Instagram followers, the District is the top retail water agency in the San Diego region. Nextdoor: Unlike other social media platforms, Nextdoor followers are based on the number of residents within the District’s service area who have joined the platform. They are automatically subscribed to receive the District’s posts. Since all its followers are customers, the platform allows staff to geotarget specific neighborhoods within its service area to share exclusive messaging regarding projects in those neighborhoods. From June 30, 2023, to June 30, 2024, the number of Nextdoor followers in the District’s service area increased by 14.23%, from 65,839 to 75,206. YouTube: From June 30, 2023, to June 30, 2024, the number of channel subscribers increased by 4.33%, from 231 to 241. The District is among the top three retail water agencies in the San Diego region with the most YouTube subscribers. Its YouTube video views increased by 4.16%, from 193,023 to 201,048. Communications staff will continue to assess its current use of social media platforms and their effectiveness. Mobile App The District launched its “Make Every Drop Count” mobile application in August 2015. In 2020, information technology (IT) and communications staff collaborated to enhance the app for iOS and Android users. The application’s features include utility bill payment, water waste reports, programs and resources, water-saving tips, water-use restrictions, contact information, and social media interaction. From June 30, 2023, to June 30, 2024, its iOS downloads increased by 13.25%, from 6,274 to 7,105, and Android downloads increased by 19.12%, from 795 to 947. Website Staff also manages and maintains the District’s external-facing website content for otaywater.gov, with the goal of better serving customers by enhancing its web presence and user-friendliness. The website's objective is to communicate the most current information and visually reflect the District’s commitment to using state-of-the-art technologies and forward-thinking practices. 4 Attachment B includes the District’s website analytics. During fiscal year 2024, its 20 most viewed website pages were the following: 1) Home Page2) Payment Options 3) For Customers4) Billing Information 5) Contact Us6) Employment7) Start or Terminate Service Page 8) Update Your Account9) Start or Terminate Service Form 10) About Otay11) Owner Acknowledgement Form12) Engineering Bids13) Water Services14) Water Agency Search 15) Rebates & Programs16) Board Agenda & Minutes17) Bid Opportunities 18) Outages19) Public Services 20) Water Quality Compared to fiscal year 2023, in fiscal year 2024, the District’s webpage views increased by 36.7% from 324,925 to 444,176. Its users increased by 36.18%, from 109,980 to 149,774. Attachment B shows the top 10 cities users were from and which URLs were considered the top 10 referral sources in fiscal year 2024. To better serve the District’s Spanish-speaking audience, the website features functionality allowing most English content to be displayed in Spanish. Staff and a consultant translate the English content into Spanish. As part of the District’s strategic plan, staff evaluates and implements improvements to the website. This includes enhancing its functionality and navigational structure, crafting content that aligns with key messaging, conveying information searched by visitors in English and Spanish, and publishing content more frequently to keep web pages attractive and engaging. To maintain an integrated communication, outreach, and marketing strategy, staff will continue to explore best practices for cross-promoting messaging through social media, its website, traditional media, and other outreach tools. It will continue to tailor and post relevant content using videos, photos, or graphics that will resonate with the District’s audience. Additionally, communications staff will 5 continue to work closely with IT staff to evaluate best practices for websites and monitor online trends to reach customers effectively. FISCAL IMPACT: Joe Beachem, Chief Financial Officer There is no fiscal impact associated with this action. STRATEGIC GOAL: Enhance and build public awareness of the District’s priorities, initiatives, programs, and services. LEGAL IMPACT: None. Attachments: A) Committee ActionB) Presentation: Social Media, Mobile Application, and WebsiteAnalytics 6 ATTACHMENT A SUBJECT/PROJECT: Social Media, Mobile Application, and Website Analytics Update COMMITTEE ACTION: The Conservation, Public Relations, Legal, and Legislative Committee (Committee) reviewed this item at an October 17, 2024, and the following comments were made: •Staff provided a PowerPoint presentation to the Committee(Attachment B). •There was a discussion of the analytics for social mediaplatform Nextdoor. Staff indicated that there were 158neighborhoods in the district’s service area. •The committee complimented staff on their interactions on Nextdoor. •Staff shared the district’s most watched video publishedduring Fiscal Year 2024, which was about how to detectwater leaks during Fix A Leak Week. It was shared through all the district’s social media platforms and received over9,000 views and 200 engagements. Staff highlighted that thevideo recently won third place in the Star Award’s Social Media Efforts Under 250K category. It was noted that thisaward recognizes excellence in government programming, and it is presented by the California Association of PublicInformation Officials and the National Association ofTelecommunication Officers. •Staff discussed the website analytics and noted that there was a 36.7% increase in views and 36.18% increase in userson the district’s website. Page views count each time auser loads a page on the district’s website, and a user represents an individual who visits the district’s website.In response to a question from the Committee, staff stated that the analytics excludes the District’s IP addresses. Traffic to the website from staff or anyone connected to the district’s Wi-Fi is not included in the analytics presented. •Staff highlighted that there was an increase in the numberof page views and users on August 25, 2023, which was onthe day of CalAm’s water advisory warning. There was alsoan increase on October 2, 2023, when Otay completed anupgrade to its Online BillPay portal. The district asked customers in advance to log on to their account and resettheir passwords. •Staff stated that the district typically receives about1,000 views a day. On August 25, the district received nearly 8,000 views, and on October 2, nearly 6,000. Inaddition, the district usually receives about 500 users aday. On August 25, there were nearly 3,500 users, and onOctober 2, more than 1,000 users. •Staff stated that Chrome and Safari are the top browsersfor users to arrive on the district’s website and socialmedia. It was noted that the PowerPoint presentation wasrevised to add Samsung Internet, which was the fifth mostused computer browser. •In response to a committee question, staff indicated thatour current Twitter account is free, and staff are evaluating the merits of using a paid subscription. Following the discussion, the Committee supported staff’s recommendation and presentation to the full board as an informational item. Social Media, Mobile Application, and Website Analytics Board Meeting November 6, 2024 Otay Water District 1 ATTACHMENT B 1.6% 2.4% 6.9% 23.3% 64.6% Social Media in Fiscal Year 2024 2 Facebook X LinkedIn Instagram Nextdoor YouTube 39,776 IMPRESSIONS ENGAGEMENTS 9,952 FOLLOWERS 753 3.58% increase from 727in FY 23 44,683 IMPRESSIONS ENGAGEMENTS 1,492 FOLLOWERS 2,299 2.41% increase from 2,245in FY23 24,542 IMPRESSIONS ENGAGEMENTS 2,266 FOLLOWERS 1,140 13.66% increase from 1,003in FY 23 16,882 IMPRESSIONS ENGAGEMENTS 1,092 FOLLOWERS 1,267 13.84% increase from 1,113in FY 23 106,109 IMPRESSIONS ENGAGEMENTS 124 FOLLOWERS 75,206 10,724 VIDEO VIEWS CUMULATIVE VIEWS201,048 SUBSCRIBERS24114.23% increase from 65,839in FY 23 4.33% increase from 231 in FY23 YouTube Traffic Sources Suggested Videos External Direct or Unknown Browse Features2.72% 3.52% 3.76% 4.25% 5.89%Otay Ranch Village 1 Eastlake Greens Rolling Hills Ranch Rancho San Diego Eastlake Nextdoor Top FollowersLinkedIn Top Followers 3.8% 4.4% 4.8% 10.2% 15.2%Water Supply and Irrigation Systems 4.16% increase from 193,023in FY 23 Gov. Administration Civil Engineering Utilities Construction YouTube Search Agency Comparison in Followers SDCWA - San Diego County Water Authority OWD - Otay Water District SWA - Sweetwater Authority HWD - Helix Water District OMWD - Olivenhain Municipal Water District VWD - Vallecitos Water District PDMWD - Padre Dam Municipal Water District X Instagram LinkedIn Facebook YouTube SDCWA 6,818OWD 2,299SWA 2,115 SDCWA 3,779OWD 1,267 HWD 1,918OMWD 1,795VWD 1,499PDMWD 1,316 PDMWD 1,097SWA 554 HWD 320 SDCWA 10,000OWD 1,140SWA 1,000 HWD 857VWD 875PDMWD 906 SDCWA 11,000VWD 2,600SWA 1,400PDMWD 958HWD 822OWD 753OMWD 693 SDCWA 1,240 OWD 241 SWA 64 OMWD 197 VWD 327 PDMWD 82 3 Fiscal Year 2024 Highlights 4 18,061 IMPRESSIONS ENGAGEMENTS 180 Facebook 1,535 IMPRESSIONS ENGAGEMENTS 9 Published March 20, 2024 Published July 8, 2023 Fiscal Year 2024 Highlights Cont’d. 5 LinkedIn 2,784 IMPRESSIONS ENGAGEMENTS 222 Instagram 1,420 REACH VIEWS 50 ENGAGEMENT 667 Published Jan. 16, 2024 Published Dec. 3, 2023 Fiscal Year 2024 Highlights Cont’d. 6 12,824 IMPRESSIONS ENGAGEMENTS 12 Published Dec. 20, 2023 Reading Your Analog Meter 101 Published Nov. 25, 2010 Nextdoor YouTube 3,278 VIEWS IN FY 23 VIEWS SINCE PUBLISHED 40,999 Fix A Leak Week Published March 18, 2024 52VIEWS Fiscal Year 2024 Highlights Cont’d. 7 Boil Water Alert 8,031 IMPRESSIONS ENGAGEMENTS 203 (across all platforms) Mobile Application 8 iOS Downloads Android Downloads 7,105 (13.25% increase) AS OF JUNE 30, 2024 6,274 AS OF JUNE 30, 2023 947 (19.12% increase) AS OF JUNE 30, 2024 795 AS OF JUNE 30, 2023 Website Analytics – Most Viewed Pages 9 Total Page Views: 444,176 PAGE VIEWS PAGE VIEWS 1. Home Page 173,275 11. Owner Acknowledgment Form 4,604 2. Payment Options 56,218 12. Engineering Bids 4,124 3. For Customers 18,764 13. Water Services 3,828 4. Billing Information 17,861 14. Water Agency Search 3,611 5. Contact Us 13,718 15. Rebates & Programs 3,064 6. Employment 11,765 16. Board Agenda & Minutes 2,977 7. Start or Terminate Service (Page)9,106 17. Bid Opportunities 2,894 8. Update Your Account 7,054 18. Outages 2,573 9. Start or Terminate Service Form 5,873 19. Public Services 2,428 10. About Otay 5,335 20. Water Quality 2,243 Total Page Views and Users 10 324,925 109,980 444,176 149,774 0 50,000 100,000 150,000 200,000 250,000 300,000 350,000 400,000 450,000 500,000 Views Users 2023 2024 36.7% increase 36.18% increase How Users Arrived 11 Direct 80,226Organic Search 64,572 Referral 4,662 Social Media 1,423 Other 284 Total Users: 149,774 Top 10 Cities 1,021 1,170 1,264 1,731 1,718 2,460 22,127 24,666 26,054 33,754(Not Set) Los Angeles Chula Vista San Diego El Cajon San Jose National City Spring Valley Rancho San Diego La Mesa Top 5 Computer Browsers 1,712 3,474 9,866 58,121 75,169Chrome Safari Edge Firefox Samsung Internet Referral Sources 12 Total Referrals: 4,662 1. google – Search engine 2. bing – Search engine 3. billpay.onlinebiller.com – Otay’s online bill payment service website 4. yahoo – Search engine 5. m.facebook.com – Facebook 6. duckduckgo.com – Search engine 7. governmentjobs.com – Government job search website 8. newsbreakapp.com – news website 9. sandiegowaterworks.org – SDCWA water industry career website 10. newsbreakapp.com – News website Questions? 13 Otay Water District otaywater.gov (619) 670-2222 info@otaywater.gov 1 STAFF REPORT TYPE MEETING:Regular Board MEETING DATE:November 6, 2024 SUBMITTED BY:Jose Martinez General Manager W.O./G.F.NO:N/A DIV. NO.N/A APPROVED BY: Jose Martinez, General Manager SUBJECT:General Manager’s Report GENERAL MANAGER: •Joint Public Information Council (JPIC) and ConservationCoordinators Meeting – On October 7, communications staffattended the San Diego County Water Authority's JPIC andConservation Coordinators meeting. The Water Authority providedupdates on upcoming events and speaking engagements, the status of the water year 2024 (October 1, 2023 through September 30,2024) and the outlook for October through December of 2024, the2024 Water Authority Master Plan Draft Report, regulatory items,water-use efficiency programs, Imagine a Day Without Water, andtalking points related to fluoride. •Business Outreach – Communications staff attended the ChulaVista Chamber First Friday Breakfast in October. •Transparency Certificate – Communications staff coordinated the District’s successful application for the TransparencyCertificate of Excellence from the Special District LeadershipFoundation. This certificate highlights the District’s commitment to transparency in operations and governance,showcasing its ongoing efforts to maintain openness with its customers. The California Special District Association willpresent the certificate to the District at its Nov. 6 boardmeeting. The certificate remains valid for three years. TheDistrict has received this certificate previously. •Otay Mesa Chamber of Commerce Dinner – On Oct. 10, the Districtsupported and participated in the Otay Mesa Chamber of AGENDA ITEM 12 2 Commerce’s 37th Annual Soiree and Awards Reception. Special guest speakers included City of San Diego Mayor Todd Gloria, City of San Diego Councilmember Vivian Moreno (District 8), and President of the Otay Mesa Chamber of Commerce Mauricio Diaz. • Water Conservation Garden Joint Public Authority (JPA) Meeting – Communications staff attended the Conservation Garden JPA meeting on Oct. 22. The JPA discussed Garden operations and finances, a resolution authorizing banking signer on the Garden bank account, and update from ad-hoc committee to review operating plans for and future development of the Water Conservation Garden, and options for extending Garden funding after June 30, 2024. The JPA discussed that most likely there will be no board meetings held in November and December of 2024, unless there is a need for a special meeting. Instead, only the ad hoc committee may meet during those months. Lynn Neault, Chancellor of the Grossmont-Cuyamaca College District and JPA member and secretary, requested that the current JPA agencies continue supporting the Garden for an additional two to three years to allow the college ample time for planning, should it need to take over the Garden in the future. Also, Lauren Magnuson, director of Garden operations, plans to present to JPA members’ boards in the upcoming months about how the JPA agencies benefit from the Garden in the upcoming months. • Award – On Sept. 26, the California Association of Public Information Officials and the National Association of Telecommunication Officers held its 27th annual STAR Awards ceremony at the Queen Mary in Long Beach. The award recognizes excellence in government programming. The District was among four finalists and received third place in the Social Media Efforts Under 250K category for its “It’s Fix a Leak Week!” video published in March 2024. The video received more than 9,000 views and 200 engagements on social media. • Campaigns – Communications staff highlighted two significant water-related observances in October on social media, garnering about 3,885 impressions and 342 engagements. The seventh annual “California Water Professionals Appreciation Week” was held on October 5-13, highlighting the essential roles of water and wastewater professionals across the state. To promote the diverse career paths within the industry, communications staff created graphics featuring images and job titles of current District employees from various sections throughout the agency. Additionally, staff highlighted “Imagine A Day Without Water” day, a national campaign emphasizing water's importance for daily living. Communications staff used a GIF graphic produced by the San Diego County Water Authority for the retail water agencies. The message included, “Imagine a day without water. We 3 make sure you don’t have to. Safe, reliable water supplies mean San Diego County’s cup is always more than half full.” ADMINISTRATIVE SERVICES: GIS: • Digital Twin Pilot Project: A digital twin is a dynamic, real- time digital representation of physical assets, systems, or processes that integrates GIS, IoT data, and advanced analytics to improve decision-making, optimize performance, and enhance operational efficiency. With advancements in GIS technology, creating digital twins — virtual models of real- world objects — has become increasingly viable for our daily operations. To explore this potential, GIS staff have initiated a pilot project focused on 3D data collection and model building for one of our pump stations. This project will provide valuable hands-on experience with digital twin technology, setting the stage for future expansion to the District’s broader infrastructure. Human Resources: • Health Reimbursement Arrangement: Implemented on September 1, 2024. HR is finalizing the process for submitting employer deductions. • Open Enrollment (OE): Held 10/15/24 – 10/25/24. Employee OE meeting held via Zoom on 10/23/24. • ERP Conversion: HR staff began participating in the meetings on 10/8/24. • COVID Cases: HR continues to process each case and continues to monitor for potential workplace outbreaks. • New Hires/Recruitments - The District is or will be recruiting for the following positions: o Lead Reclamation Plant Operator: New hire started on 9/16/24. 4 o Customer Service Representative (CSR) I/II – Pursued candidate from Lead Customer Service Recruitment. New hire, CSR II, started on 10/21/24. o Facilities Maintenance Technician: Interviews completed on 9/12/24. New hire started on 10/28/24. o Senior/Utility Locator: Recruitment posted 7/30/24. Phone screening interviews completed on 9/10/24. Interviews completed on 9/17/24. Additional applications will be reviewed. o SCADA/Instrumentation Technician or Senior SCADA/ Instrumentation Technician: Interviews held 10/15/24; panel’s review of candidates is in progress. o Utility Worker I/II (2 new vacancies): Interviews were completed on 10/21/24. Pursuing one candidate; additional applications sent to Department for review. o Reclamation Plant Operator I/II/III (1 vacancy remains): First vacancy filled on 7/9/24. Temporary employee started on 7/18/24. Mass mailing to 1,140 potential applicants completed. Applications are being reviewed as they are received. o Meter Maintenance Worker I/II – Interviews and testing held 10/28/24. • Employee Service Milestones – October 2024 o Laura York, Lab Analyst, achieved 5 years of service on 10/14/24. o Hannah Tamjidi, Department Assistant, achieved 5 years of service on 10/14/24. IT Operations: • EERP Implementation - The Staff reached a significant milestone in the Munis implementation, completing the vendor conversion into the new system and the General Ledger, Budgeting Data, and Project String imports. The team has recently started the Human Resources and Payroll module, which overlaps with the ongoing work on the rest of the financial module, advancing the project to its next stage. 5 Purchasing & Facilities: • Regulatory Shop Roll-Up Door Replacement Project (FY25-2231- 20) – On behalf of the Water Operations Disinfection team, and to enhance the security and efficiency of the disinfection shop and storage area, Purchasing and Facilities solicited bids for the installation of two motorized roll-up doors at the Regulatory Shop. The project involves the removal of the existing doors, which are decades old, deteriorating, and no longer provide adequate protection against dust and rodents. The new installation will include high-quality steel roll-up doors equipped with electric operators and essential safety features. Contractors were required to meet stringent qualifications, including holding a valid Doors, Gates, and Activating Devices C-61/D28 license, complying with prevailing wage laws, and adhering to state and local regulations. Coordination with the District’s Project Manager is essential for scheduling, ensuring minimal disruption, and the proper disposal of materials. Bids were submitted through PlanetBids by the October 1, 2024, deadline, evaluated based on cost, contractor qualifications, and compliance with the project’s technical specifications. Three bids were received with final amounts of $25,910, $27,945, and $32,981. Staff is currently reviewing the bids to 6 select the most qualified and cost-effective contractor for the replacement project. Completion is targeted by the end of November, contingent upon material lead times. This roll-up door replacement project reflects the District’s commitment to maintaining high standards, implementing sustainable and forward-thinking solutions, and ensuring secure, efficient, and future-ready operations. Safety & Security: • County of San Diego Office of Emergency Services (OES) Annual Hazard Mitigation Planning Group Meeting - As part of the ongoing efforts to strengthen the region's resilience to disasters, the OES conducted their annual meeting with the multi-jurisdictions including special districts, such as Otay Water. During the meeting, staff shared highlights from the District's strategies and action plans and identified future opportunities for future mitigation efforts. • Hazardous Materials Technician Annual Refresher Training - The District’s HazMat Team attended their instructor-led and in- person refresher training. Members are emergency responders who are trained to approach the point of a hazardous material spill or release, while using personal protective equipment (PPE), in order to stop or control the hazardous substance. District currently uses state regulated chemicals such as chlorine gas and aqueous ammonia. Staff are trained as HAZMAT Technicians to perform advanced control, containment, and confinement operations and use decontamination procedures. The 8-Hour training is designed to help staff refresh their Hazardous Materials Technician level training previously completed per Cal/OSHA’s Hazardous Waste Operations regulation. Training was completed at the Ralph Treatment Plant and Chlorine Gas storage area. 7 FINANCE: • OPEB Actuarial Study – Following the closure of the OPEB plan to new members, the District will conduct an actuarial evaluation of the OPEB plan. A contract has been executed with Total Compensation Systems (TCS), and staff are working on TCS’s initial information request. • Water Loss Audit – Staff have compiled all relevant water loss data and submitted it to the auditors. A meeting with the auditors is scheduled for early November to review their findings, and the District is on track to submit the audited 8 data to the Department of Water Resources (DWR) before the December 31, 2024 deadline. • Rate Increase Notices – Rate increase notices were mailed to customers with their billing statements from September 13 through October 12. As of October 24, one customer has contacted customer service with a general inquiry about how the new sewer rates will affect their bill. • WaterSmart Grant Opportunity – Staff will be submitting another grant application for the next round of WaterSmart grant funding for Phase III, which is related to converting additional meters to AMI. The previous grant was related to the conversion of approximately 3,500 meters to AMI, with completion expected by December 2026. This new application will focus on work scheduled for the 2027 calendar year. We are currently working with our grant consultant, Hoch Consulting, to determine the amount to request for this round. Applications are due by November 13. Financial Reporting: • The financial reporting as of September 30, 2024, is as follows: o As of the third month ending September 30, 2024, there are total revenues of $37,022,523 and total expenses of $36,633,755. The revenues exceeded expenses by $388,768. • The financial reporting for investments as of September 30, 2024, is as follows: o The market value shown in the Portfolio Summary and in the Investment Portfolio Details as of September 30, 2024, total $114,789,826 with an average yield to maturity of 4.278%. The total earnings year to date are $1,235,253. ENGINEERING AND WATER SYSTEM OPERATIONS: Engineering: • Vista Diego Hydropneumatic Pump Station Replacement and 12-inch Pipeline Replacement, 1530 Zone, Vista Diego Road: This project includes the replacement of the existing Pump Station, which serves the small 1530 Pressure Zone, containing approximately thirty-seven (37) potable water meters and four (4) hydrants. The project also includes 1530 Pressure Zone distribution system improvements in support of the Pump Station Replacement project and replacement of the existing emergency standby generator. A 60% drawing submittal for the replacement Pump Station was completed on August 16, 2023, and a Review Meeting was held on 9 August 29, 2023. A 60% peer review by the District’s As-needed Engineering Design consultant, NV5, was completed on October 16, 2023. The District’s As-needed Electrical Engineer, EPI, completed their 90% submittal on September 29, 2023. The District’s As-needed Environmental consultant, Chambers Group, completed the remaining biological surveys in June 2024. The Mitigated Negative Declaration (MND) is scheduled to be completed by the end of the calendar year. Due to vacancies within the department, the pre-project work is being pushed out while other projects are prioritized. The project is within budget and on schedule. (P2639, P2680, and P2688) • RWCWRF Disinfection System Improvements: The project involves the replacement of the chlorine gas disinfection system with an ultraviolet (UV) process at the Ralph W. Chapman Water Reclamation Facility. Consultant selection for design and construction support went to Carollo Engineers, and design work was initiated in July 2021. A Memorandum of Understanding has been reached with Trojan for procuring the UV system through the construction contractor at a bid obtained cost. This will also reduce material acquisition delays related to this equipment, which are expected to take a year to ship. A construction contract has been awarded to GSE Construction Co., Inc., with the UV submittal to be top priority for getting the project started. The plant engineering report was updated for preparation of completing the permitting process with the state. The contractor ordered the Trojan UV system, which arrived on August 22, 2024. A Pre-Construction Meeting was held on November 6, 2023. On January 25, 2024, staff received review comments from the Division of Drinking Water pertaining to the Title 22 Engineering Report update for the RWCWRF. Engineering and Operations staff worked together with the consultant to respond to state comments, with the responses sent in June 2024. On February 21, 2024, staff presented the Disinfection Improvement Project at the Board Workshop as an informational item. Submittals, RFI, and materials are being reviewed, responded to, and procured. A Notice to Proceed was issued for April 8, 2024, and the contractor, GSE, has mobilized and begun construction. Initial work on the sodium hypochlorite containment line has been completed. Duct bank to provide power and communication is completed. The first and second planned shutdowns are going to be combined to minimize downtime on the plant. The shutdown is tentatively scheduled for October 30, 2024, with the plant back online starting December 2, 2024. The project is within budget and on schedule. (R2117 and R2157) 10 • 450-1 Recycled Water Reservoir Stormwater Improvements: Stormwater runoff from the 450-1 Recycled Water Reservoir site has been eroding the downstream area and exposed the District's 30-inch recycled water line. Staff is working with NV5 on potential design and permitting solutions. Helix Environmental is currently working on the regulatory permit applications for the work within the tributary. The project is within budget and on schedule. (R2164) • Zero Emission Vehicles and Charging Infrastructure: This project is for the capital purchase and installation of various electric vehicle support equipment, such as charging infrastructure needed to power Zero Emission Vehicles (ZEVs) for light, medium, and heavy-duty electric vehicles. The project is in preparation for compliance with the State of California's Executive Order N- 79-20 and the Advanced Clean Fleet Regulation to require ZEV purchases when adding to the District's fleet of vehicles. A 30% EV Charging Station Master Plan has been submitted by As- needed Electrical Consultant, Engineering Partners, Inc. (EPI). Engineering is conducting the initial review. Based on initial findings of the Master Plan and possible grant opportunities, Engineering hired EPI under an As-needed Electrical Agreement to design the first five (5) charging stations for Operations to meet their growing fleet demand for FY 2025. Design drawings will be used to submit for grant opportunities to help offset the capital cost for the charging stations for FY 2025. The Clean Air For All Grant was submitted on April 12, 2024, with a potential funding amount of $153,000 for Operations’ first permanent electric charging station. The 30% Master Plan has been reviewed collectively by Operations and Engineering staff, and comments have been returned to the consultant. The 60% planning is in progress. The resubmittal by the consultant is anticipated in November 2024. The project is within budget and on schedule. (P2684) • Potable Pipeline Replacement Projects: The following set of pipelines are being replaced as a result of past failures, age, lack of redundancy, and/or improved fire flow. A 30% design has been submitted by NV5, reviewed, and returned by staff. The 60% design plans are under review by staff. • PL - 8-inch, 850 Zone, Coronado Avenue, Chestnut/Apple (P2608) • PL - 8-inch, 1004 Zone, Eucalyptus Street, Coronado/Date/La Mesa (P2609) 11 • PL - 12-Inch Pipeline Replacement, 803 PZ, Vista Grande (P2615) • PL - 20-Inch, 1296 Zone, Proctor Valley Road from Pioneer Way to Melody Road, “South Proctor Road” (P2171) • PL - 20-Inch, 1296 Zone, Proctor Valley Road from Melody Road to Schlee “North Proctor Road” (P2058) – appraisal process and reports have been submitted by Bender Rosenthal, Inc. and reviewed by staff. Offer letter packets to acquire proposed easement to install the waterline are being finalized and will be sent to the owners in December 2024. • Steele Canyon Road Bridge 20-inch Water Main and 6-inch Force Main Renovations: Several portions of the existing pipelines were noted to have corrosion pitting, primarily located at pipe supports for the 20-inch steel potable water main and at pipe joints for the 6-inch steel sewer force main. First phase, to assess the extent of the corrosion, has been completed and staff is now working on preparing recommendations for the repairs of the pipelines. The project is within budget and on schedule. (P2687 & S2079) • Olympic Parkway Recycled Water Line Replacement: Several main breaks within the past few years on the 20-inch recycled water line in Olympic Parkway between Heritage Road and La Media Road resulted in the establishment of this Capital Improvement Program project at the May 2021 Board Meeting. The engineering firm, NV5, was selected to design the replacement waterline using the District’s As-needed Engineering Design Services contract. The project was awarded to Burtech in January 2023. The City of Chula Vista permits have been obtained. Consideration was given to potentially using trenchless installation, but several drawbacks and limitations eliminated it from selection. The contractor has started procuring materials, and a Pre-Construction Meeting was held on June 8, 2023. The valves were delivered and tested at the end of May 2024. Progress meetings have begun, and the contractor received the permit from the City of Chula Vista. A notice to proceed was issued for March 25, 2024, and most of the work will be night work to minimize traffic delays. The contractor mobilized on July 15, 2024. The contractor is approximately 65% complete with the pipeline installation and is behind schedule. The contractor is working on adding an additional crew. The project is within budget. (R2159) 12 • Olympic Parkway Transmission Main Assessment and Repair: Several main breaks within the past few years on the 16-inch potable water line in Olympic Parkway between East Palomar Street and State Highway 125 resulted in the establishment of this Capital Improvement Program project through the annual budget process. This project is for the condition assessment and repair, if needed, of interior joints within approximately 3,500 feet of 16-inch cement mortar lined and coated steel transmission main along Olympic Parkway east of East Palomar Street. The first phase of this project is an assessment. An assessment is needed to determine the condition of the pipeline joints throughout the pipeline. The District recently received permits from the City of Chula Vista and Caltrans, and staff are currently coordinating with an interior video inspection contractor, Houston Harris, to perform the inspection. The work will be night work to minimize traffic delays, and staff anticipates the work will begin in 2025. The project is within budget and on schedule. (P2706) • Cottonwood Sewer Pump Station Replacement: This project involves the replacement of the existing sewer pump station originally constructed in 1986 as a temporary facility due to operational and accessibility deficiencies. The station serves both the District and County of San Diego customers on the southside of the Sweetwater River. Improvements will incorporate increased station capacity, now and in the future, with a force main upgrade, as well as emergency storage to avoid a sewage spill. The design is being prepared by Wood Rodgers, Inc., with the preliminary design report completed in October 2023. An amendment for Wood Rodgers Agreement to confirm the replacement pump station design flow rate and emergency sewer storage volume considering recent storm events, study the future need for upsizing of the existing offsite 6-inch force main, and compare the current dry pit pump configuration in the preliminary design report to two (2) submersible pump configurations constructed by other agencies was executed on October 16, 2024. The Mitigated Negative Declaration (MND) was prepared in September 2021 and will be reviewed and updated prior to finalizing the design. Staff vacancies have been filled and the project has been reassigned such that construction of the project is currently estimated to complete in FY 2028. The project is within budget. (S2069) • 870-2 Reservoir and 870-1 Reservoir Floating Cover/Liner Replacement: This project consists of constructing a new 3.4 MG prestressed concrete potable water tank adjacent to the existing 870-1 Reservoir. The project also includes lowering the existing 870-1 Reservoir 30-inch inlet pipe and replacing the existing floating cover and liner within the existing 870-1 13 Reservoir. The District’s As-needed Engineering Design consultant, Wood Rodgers, teamed with Richard Brady and Associates (Wood Rodgers/Brady), the District's As-needed Electrical consultant, BSE, and the District’s in-house staff to complete the design. The construction contract was awarded to Pacific Hydrotech at the September 2024 Board Meeting and the corresponding Purchase Order was issued on October 1, 2024. A Pre-Construction Meeting was held on October 7, 2024, and Notice to Proceed started October 28, 2024. Both projects are on schedule. (P2228 & P2563) • Potable Water Pressure Vessel Program - Rolling Hills: The 2004- era Rolling Hills Hydropneumatic Pump Station hydropneumatic pressure vessel was inspected on June 6, 2017 and February 27, 2023. Both inspection reports noted interior corrosion due to internal coating failure. The February 2023 inspection report recommended a reduction in the safety relief valve pressure setpoint to compensate for internal corrosion. The February 2023 inspection report also suggested that the life expectancy of the vessel may be three (3) years. Consequently, the report recommended interior re-inspection within three (3) years rather than the typical five (5) year inspection frequency. With the hydropneumatic tank at the end of its life and the limited availability of the trailer-mounted variable frequency drive pump station (VFD trailer), the tank is scheduled for replacement. On January 23, 2024, the purchase of a hydropneumatic tank from Modern Custom Fabrication, Inc. was approved at the February 7, 2024 Board Meeting. The District’s in-house staff mobilized and began connecting the VFD trailer to the project site on February 9, 2024. Modern Custom Fabrication completed fabrication of the replacement pressure vessel on September 19, 2024. Delivery and installation of the new vessel is tentatively scheduled mid-November or early December 2024. The project is within budget and on schedule. (P2663) • Telegraph Rd – Hydrant Repair: In late April 2024, a vehicle accident damaged a dual-purpose blow off valve and fire hydrant appurtenance located at 1052 Telegraph Canyon Road, Chula Vista, approximately 800 feet east of Heritage Road/Paseo Ranchero. The fire hydrant has been struck three (3) times by vehicles in the past seven (7) years. Notably, in the most recent incident, not only was there damage to the above ground appurtenance, but when operating the 6-inch valve to isolate the fire hydrant, a break was identified near the 20-inch ACP water main. This water main is a major arterial water line and provides potable water to nearby critical infrastructure including a hospital. 14 Repairs to the pipeline are complicated due to the pipeline’s depth, requiring outside contractors with equipment to repair at that elevation. The water main is approximately 16 feet deep near the fire hydrant. There are nearby utility crossings, which include a triple 6 feet by 10 feet box culvert, an 8-inch-high pressure gas line, a 36-inch storm drain, and a 30-inch steel casing on the 20-inch water main. Design is anticipated to be finalized by the end of the calendar year with work on the repair starting in early 2025. • 1485-2 Reservoir Interior/Exterior Coating & Upgrades: This project is for the interior and exterior coatings of the 1485-2 Reservoir, located at 15010 Lyons Valley Road, Jamul. This welded steel Reservoir has a 1.6-million-gallon capacity. Based upon the current inspection report, the interior and exterior coatings on the 1485-2 Reservoir are nearing the end of their useful lives and need replacement. The Reservoir was constructed in 2006 and has never been recoated. In addition to removing the existing interior and exterior coating and recoating the Reservoir, the project includes rafter replacement, seismic rod replacement, cathodic protection equipment replacement, and structural modifications. The project was advertised for bid in August 2024 and is being awarded at the November Board Meeting. (P2657) • City of San Diego – Otay 2nd Pipeline Phase 4 Interconnections Relocation: The City of San Diego (City) is working on Phase 4 of the replacement and realignment of the 40-inch potable water line between Telegraph Canyon Road and Bonita Road with a 48- inch pipeline. The District has two interconnections to this line located at East H Street and Telegraph Canyon Road that will need to be replaced to conform to the new construction. The City recently completed the 60% design stage for the new pipeline. The District’s staff has reviewed the City’s 60% design and identified potential utility conflicts, which are being coordinated with the City. The two potential interconnection relocations have been identified and are being considered. Additionally, new interconnection agreements with the City of San Diego are being evaluated and will be finalized concurrently with the City finalizing their pipeline design. The City design is expected to be finalized at the beginning of FY 2026. The design is currently in the environmental permitting stage. (P2691) • City of Chula Vista – Heritage Road Replacement: The City of Chula Vista is constructing a new bridge crossing the Otay River 15 at Heritage Road, which provides an opportunity for the District to relocate an existing pipeline out of the river into a more secure location. The City of Chula Vista opened bids in September and awarded the contract at their October 8th Council meeting. (P2553, P2405) • Sycuan Treatment Plant: The Sycuan Tribal Nation is working with the District to evaluate the feasibility of accepting processed solids from their proposed Recycled Water Treatment Plant. The District initiated a Task Order for NV5 to provide engineering services in the technical evaluation of accepting the solids stream, especially as it will combine with the municipal sewer flows into the Ralph W. Chapman Water Recycle Facility. Additionally, the consultant will assist the District with regulatory and contractual considerations for accepting the Sycuan discharge. In coordination with the engineering consultants, staff will consider cost impacts and ensure proper cost recovery. As the project progresses, it is anticipated that other agencies’ reviews and/or approvals will be necessary, along with associated agreements established or updated. Consultant and staff time costs are being recovered through a deposit account funded by Sycuan. • Recycled/Reuse Feasibility: Sweetwater Authority (SWA) and the District are working collaboratively through a Memorandum of Understanding (MOU) to evaluate the feasibility of extending water reuse into the SWA area. On February 7, 2024, a Professional Services Agreement (PSA) for a feasibility study was awarded by the Board to Carollo Engineers (Carollo). On June 20, 2024, the District was approved for grant funding from the Water Recycling Funding Program for the SWA and OWD Intertie Project for $300,000. The District’s staff, SWA, and Carollo are conducting biweekly progress meetings and collecting data for the Planning and Feasibility Report. (R1254) • Otay Water District Climate Adaptation and Resilience Planning Project: On November 21, 2023, FEMA approved and issued Hazard Mitigation Grant Program (HMGP) funds for the preparation of a Climate Adaptation and Resilience Plan for the District. FEMA authorized a total of $244,939.70. The CARP will include a risk and resilience assessment focusing on climate change. The CARP will also include the development of resilience and adaptation strategies to allow the District to prioritize risks. Strategies may include updated policies, built infrastructure- based measures, green infrastructure-based measures, operational approaches, staff training and tools, and communication and 16 education for customers. The Kick-off Meeting was held in August 2024, and the initial phase of data collection has begun. The final Plan will be incorporated into the District’s Local Hazard Mitigation Plan Annex. (P1253) Sewage Flows to Metro vs Planned Capacity: The Metropolitan Water District Amended and Restated Regional Wastewater Disposal Agreement became fully effective at the start of FY 2023. The District’s annual capacity of 0.38 MGD (139 MG) is now in effect, though the District would need to exceed this capacity for three (3) consecutive years before additional capacity must be acquired. The Metropolitan Water District (Metro) capacity was set based upon the District’s sewer system requirements through planning year 2050. Plant experienced a plant upset from 9/20/2024 through 9/22/2024. Higher amount of sewer discharge was convened into the Metro system. Current discharge total for FY 2025 is 14.31 MG, well below the 34.77 MG planned capacity. 17 • Summary of Budgeted and Sold Meters and EDUs for Fiscal Year 2025 through September 2024: OPERATIONS: • On Wednesday September 18th, Treatment Plant staff reported a failure on equipment #1 at the Russell Square lift station. Pump Mechanics were promptly dispatched to troubleshoot the issue and identified a major mechanical failure in the pump and required replacement. On Tuesday September 24th, a new 5 HP pump was installed, tested, and successfully returned to service. • On Friday September 27th, Water Systems staff, with assistance from Utility maintenance staff, performed an emergency shutdown on the 832-1 Pump Station’s 16-inch steel discharge pipeline. This shutdown was performed to make a temporary repair to a one- inch weld-on nozzle on the main. The shutdown lasted seven hours with no customer impact. The temporary repair was performed since the area had difficult accessibility due to the pipeline’s alignment going up a hillside and preparations for a temporary road was needed to access the area for a permanent repair. • On Saturday, September 28th, Utility Maintenance staff responded to an emergency one-inch copper service leak at 3372 Rancho Diego Circle in El Cajon. Staff arrived on site and determined the service needed to be replaced. Staff replaced the service, backfilled the excavations, and cleaned up the site. • On Sunday, September 29th, Water Systems staff, with the assistance from Utility Maintenance staff, performed an emergency shutdown at 3021 Jamacha View Drive in Jamul. This shutdown was performed to replace a leaking one-inch service saddle. The shutdown lasted 10 hours and affected 30 meters, with two water trailers available for the affected customers. • On Monday, September 30th, emergency flow deliveries to Mexico were stopped by mutual agreement from all parties. A total of 395.42 acre-feet were delivered to Mexico during the month of September. There was an undelivered variance of 33.97 acre-feet due to limitations on Mexico’s side that reduced the amount of flow Mexico was able to receive. Date Meters (Budgeted) Meters Sold (Actual) EDUs (Budgeted) EDUs Sold (Actual) Total $ (Budgeted) Total $ Collected (Actual) September 2024 20.2 19 58.8 41.5 $955,391 $581,011 Totals FY 2025 60.5 77 176.5 156 $2,866,172 $2,293,697 18 • On Wednesday, October 2nd, pump #5 at the 870-2 Pump Station was re-installed after a rebuild was performed. This 4,000 GPM electric pump had a water leak that needed to be repaired. The repair was completed by a District vendor and was certified by the equipment manufacturer. The pump is now operating normally. • On Thursday, October 3rd, the County of San Diego performed the annual Laboratory Fume Hood Inspection. At the time of the inspection, there were no deficiencies mentioned by the inspector. The District should receive the finalized inspection report by the end of October. Fume hoods remove vapors from chemicals used in the Laboratory. Annual inspections help ensure that the fume hood is working properly. • On Saturday, October 5th, Utility Maintenance staff began de-brushing and creating an access road to the one-inch air-vac on the 832 pump line that had failed on Friday, September 27th. Establishing the easement road took three days and was completed on Tuesday, October 8th. The permanent repair was scheduled for Wednesday, October 16th, and Utility Maintenance staff assisted Water Systems staff setting up the emergency bypass pump on Tuesday, October 15th, at the Steele Canyon interconnect. The pump was set as an emergency backup if repairs were delayed. On Wednesday, October 16th, the welder removed the failed one-inch welded tap nozzle and installed a two-inch tap nozzle with an oversized backer plate to cover the damaged steel main. Utility Maintenance staff completed the installation and backfilled the new two-inch air-vac/blow-off combo on Thursday, October 17th. • The following events occurred on Tuesday, October 8th: o The District’s Hazardous Waste Operations and Emergency Response Confined Space Rescue Team (HAZWOPER) completed their Cal-OSHA required eight-hour refresher training. o Water Systems staff performed a planned shutdown on the 20- inch recycled main on Olympic Parkway between Santa Venetia and La Media Road in Chula Vista. This was needed to relocate an existing six-inch blow off valve that conflicts with the alignment of the new 16-inch main that is being installed. This work was part of capital improvement project CIP R2159. The shutdown lasted nine hours and affected three irrigation meters. • The following events occurred on Wednesday, October 9th: o Electricians coordinated and performed tests on ten Automatic Transfer Switches (ATS) as part of the preventive maintenance 19 program. Automatic Transfer Switch (ATS) testing is important to ensure that the switch is working properly and can transition to backup power during power outages. Testing ensures that the ATS is within manufacturer specifications, the load transfer is safe and efficient, is dependable, and prevents disruptions. No deficiencies were detected during these tests. o Utility Maintenance staff responded to an emergency leaking six-inch fire service lateral at 749 Brookstone Drive in Chula Vista. Upon arrival, staff secured the area and began excavating and discovered the leak was caused by a failed two- inch tap saddle that had been tapped onto the fire service lateral. Staff replaced the two-inch tap saddle and backfilled the excavation. After the repair was completed Utility Maintenance Supervisors notified the Engineering department of the unusual tap location. Engineering staff is currently working on an alternative solution to the tap location. • On Thursday October 10th, Water Systems staff assisted the Inspection section with bacteriological sampling for a new development located at Siempre Viva Road and Enterprise Road in Otay Mesa (Developer project D1132). The main was placed into service after passing bacteriological tests. • On Tuesday October 15th, Water Systems staff assisted with testing of the portable trailer on the Steele Canyon and Jamul Drive emergency pump pad in El Cajon. This pump pad allows for the pumping of water from the 803 to the 832 pressure zone, if needed. The testing went smoothly, with no issues reported. • On Wednesday, October 16th, Water Systems staff performed a planned shutdown on the 832-1 Pump Station’s 16-inch steel discharge pipeline. This shutdown was performed to make permanent repairs to a one-inch weld-on nozzle on the main. The shutdown lasted nine hours with no customer impact. • On Thursday, October 17th, Operations staff hosted a tour of District facilities to newer District Staff. The tour was conducted at the 980-2 Pump Station/624-3 Reservoir site in Chula Vista and the 870-2 Pump Station in the Otay Mesa area. The tour provided an overview of how the District distributes water to customers. The tour was well received by staff. • On Monday, October 21st, staff sent the District’s response to the Environmental Protection Agency’s (EPA) Inspection Report of the Ralph W. Chapman Water Recycling Facility’s chlorine program. The EPA conducted an inspection of the chlorine program at the plant on Friday, June 28, 2024, and sent their inspection 20 report on Monday, August 12, 2024. The EPA report listed four areas of concern and three recommendations that required a District response. Once the EPA reviews the District's response, they will determine if any violations and/or monetary fines will be levied. Purchases and Change Orders: • The following table summarizes purchases and change orders issued during the period from September 16, 2024 through October 18, 2024 that were within staff signatory authority: Date Action Amount Project Contractor/ Consultant/Vendor 9/16/2024 P.O. $21,175.64 FY25 DELL NETWORKING EQUIPMENT SUPPORT SERVICES COMPUTER BUSINESS CONSULTANTS 9/16/2024 P.O. $10,000.00 FY25 AS-NEEDED SCADA SUPPORT SERVICES TECHKNOWSION, INC 9/16/2024 P.O. $2,278.48 FY25 EMERSON SOFTWARE SUPPORT RENEWAL CB PACIFIC, INC. 9/16/2024 P.O. $122,147.97 FY25-27 MICROSOFT LICENSING & HARDWARE/SOFTWARE MAINTENANCE ENTISYS 360 9/18/2024 P.O. $9,983.46 FY25 TREATMENT PLANT REPORTING TOOL AQUATIC INFORMATICS, INC. 9/18/2024 P.O. $20,738.85 FY25 SCADA SOFTWARE LICENSE RENEWAL GE DIGITAL, LLC 9/24/2024 P.O. $11,213.00 METER SHOP CABINETS & COUNTERTOP SOUTHWEST MILLWORKS, INC 10/1/2024 P.O. $17,999.00 FY25 DRONEDEPLOY SOFTWARE LICENSE DRONEDEPLOY, INC 10/1/2024 P.O. $2,322.01 CISCO MERAKI ACCESS POINTS PINNACLE BUSINESS SOLUTIONS 10/2/2024 C.O. $14,200 ACTUARIAL SERVICES TOTAL COMPENSATION SYSTEMS INC 10/7/2024 P.O. $5,481.92 FIRE, LIFE, SAFETY SERVICES THE HILLER COMPANIES 21 10/7/2024 P.O. $59,200.00 FY25 ESRI EEAP ADVISORY SUBSCRIPTION ENVIRONMENTAL SYSTEMS RESEARCH 10/9/2024 P.O. $1,573.60 CRADLEPOINT SUBSCRIPTION LICENSES GHA TECHNOLOGIES, INC 10/09/2024 CC $5,642.02 870-2 RESERVOIR & 870-1 RESERVOIR IMPROVEMENTS (P2683) ABC IMAGING 10/16/2024 AMENDMENT #1 $61,240.00 COTTONWOOD SEWER PUMP STATION REPLACEMENT (S2069) WOOD ROGERS, INC. 10/17/2024 CC $5,761.32 870-2 RESERVOIR & 870-1 RESERVOIR IMPROVEMENTS (P2683) STI VIRBRATION MONITORING, INC. 10/18/2024 CC $9,865.23 870-2 RESERVOIR & 870-1 RESERVOIR IMPROVEMENTS (P2683) PCB PIEZOTRONICS, INC. Water Conservation and Sales: • Water Conservation – September 2024 usage was 16% lower than September 2013 usage. Since September 2023, customers have saved an average of 14% over 2013 levels. • Potable Water Purchases – The September potable water purchases were 2,787 acre-feet which is 4.9% below the budget of 2,932 22 acre-feet. Cumulative purchases for the year are 8,752 acre-feet, 1.1% below the year-to-date budget of 8,846 acre-feet. • Recycled Water Purchases – The recycled water purchases from the City of San Diego and production at the District’s treatment facility for the month of September were 462 acre-feet which is 5.4% below the budget of 488 acre-feet. Cumulative purchases and production for the year are 1,416 acre-feet, 3.4% below the year-to-date budget of 1,466 acre-feet. 23 • The table below displays the year-to-date and monthly rainfall data for August. Rainfall September Y-T-D Actual 0.02 0.02 Three-year Historical Average 0.40 0.51 Variance (0.38) (95.0%) (0.49) (96.1%) Potable, Recycled, and Sewer (Reporting up to the month of September): • Total number of potable water meters: 52,019. • Total number of sewer connections: 4,752. • Recycled water consumption for the month of September: o Total consumption: 417.49 acre-feet or 153,627,980 gallons. o Average daily consumption: 5,120,932 gallons per day. o Total cumulative recycled water consumption since September 2023: 1,416.95 acre-feet. o Total number of recycled water meters: 801. • Wastewater flows for the month of September: o Total basin flow: 1,641,467 gallons per day.  This is a decrease of 5 percent from September 2023. o Spring Valley Sanitation District flows to Metro: 549,366 gallons per day. o Total Otay flow: 1,092,000 gallons per day. o Flow processed at the Ralph W. Chapman Water Recycling Facility: 834,967 gallons per day. o Flow to Metro from Otay Water District: 257,033 gallons per day. o By the end of September there were 6,751 wastewater EDUs. Exhibit A Annual YTD REVENUES: Budget Actual Budget Variance Var % Potable Water Sales 74,767,000$ 21,895,386$ 22,801,000$ (905,614)$ (4.0%) Recycled Water Sales 11,014,000 4,080,135 4,170,000 (89,865) (2.2%) Potable Energy Charges 3,578,000 950,766 1,081,400 (130,634) (12.1%) Potable System Charges 14,131,000 3,378,970 3,384,000 (5,030) (0.1%) Potable MWD & CWA Fixed Charges 16,555,000 3,530,396 3,549,000 (18,604) (0.5%) Potable Penalties and Other Fees 1,067,000 285,540 332,200 (46,660) (14.0%) Total Water Sales 121,112,000 34,121,193 35,317,600 (1,196,407) (3.4%) Sewer Charges 3,482,000 885,139 876,300 8,839 1.0% Meter Fees 158,000 45,288 39,600 5,688 14.4% Capacity Fee Revenues 2,833,000 675,042 708,300 (33,258) (4.7%) Non-Operating Revenues 2,566,000 785,453 596,200 189,253 31.7% Tax Revenues 6,840,000 209,367 214,500 (5,133) (2.4%) Interest 1,102,000 301,041 275,500 25,541 9.3% Total Revenues 138,093,000$ 37,022,523$ 38,028,000$ (1,005,477)$ (2.6%) EXPENSES: Potable Water Purchases 54,323,000$ 15,693,645$ 15,823,900$ 130,255$ 0.8% Recycled Water Purchases 6,123,000 2,238,900 2,238,900 - 0.0% CWA-Fixed Transportation Charge 1,125,000 - - - 0.0% CWA-Infrastructure Access Charge 3,258,000 796,752 798,000 1,248 0.2% CWA-Customer Service Charge 2,166,000 527,547 528,000 453 0.1% CWA-Reliability Charge 3,768,000 844,959 846,000 1,041 0.1% CWA-Emergency Storage Charge 5,178,000 1,242,363 1,242,000 (363) (0.0%) MWD-Capacity Res Charge 840,000 195,696 195,000 (696) (0.4%) MWD-Readiness to Serve Charge 684,000 177,738 171,000 (6,738) (3.9%) Subtotal Water Purchases 77,465,000 21,717,600 21,842,800 125,200 0.6% Power Charges 5,058,000 1,326,128 1,609,400 283,272 17.6% Payroll & Related Costs 27,724,800 7,062,949 7,352,200 289,251 3.9% Materials & Maintenance 5,224,400 1,136,567 1,306,200 169,633 13.0% Administrative Expenses 9,526,800 2,080,180 2,372,900 292,720 12.3% Legal Fees 402,000 137,331 100,500 (36,831) (36.6%) Expansion Reserve 5,720,000 1,430,000 1,430,000 - 0.0% Betterment Reserve 2,643,300 660,800 660,800 - 0.0% OPEB Trust 350,000 87,500 87,500 - 0.0% General Fund Reserve 3,978,700 994,700 994,700 - 0.0% Total Expenses 138,093,000$ 36,633,755$ 37,757,000$ 1,123,245$ 3.0% EXCESS REVENUES(EXPENSES) -$ 388,768$ 271,000$ 117,768$ OTAY WATER DISTRICT COMPARATIVE BUDGET SUMMARY FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2024 F:/MORPT/FS2025 P3 - Sept.xlsx 10/23/2024 1:33 PM The year-to-date excess revenues of $388,768 are $117,768 more than the budgeted surplus of $271,000. COMPARATIVE BUDGET SUMMARY NET REVENUE AND EXPENSES FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2024 -$1,600,000 -$1,400,000 -$1,200,000 -$1,000,000 -$800,000 -$600,000 -$400,000 -$200,000 $0 $200,000 $400,000 $600,000 $800,000 $1,000,000 $1,200,000 $1,400,000 $1,600,000 $1,800,000 JUL AUG SEP OCT NOV DEC JAN FEB MAR APR MAY JUN YTD Actual Net Revenues YTD Budget Net Revenues YTD Variance in Net Revenues OTAY WATER DISTRICT INVESTMENT PORTFOLIO REVIEW September 30, 2024 INVESTMENT OVERVIEW & MARKET STATUS: At the Federal Reserve Board's regular meeting on September 18, 2024, the Committee decided to lower the target range for the federal funds rate from 5.50% to 4.75%-5.00%, considering the progress on inflation and the balance of risks. Recent indicators suggest that economic activity has continued to expand at a solid pace. The Committee will evaluate the risk balance, outlook, and incoming data prior to making any modifications to the federal funds rate target range. It is intended to support employment and restore inflation to its 2% objective by decreasing Treasury securities and agency debt. The Committee will continue to observe the effects of incoming information on the economic outlook. In determining the timing and size of future adjustments to the target range for the federal funds rate, they went on to say: "The Committee would be prepared to adjust the stance of monetary policy as appropriate if risks emerge that could impede the attainment of the Committee's goals. The Committee's assessments will take into account a wide range of information, including readings on labor market conditions, inflation pressures and inflation expectations, and financial and international developments." The District's effective rate of return for September 2024 was 4.23%, two basis points higher than the previous month. LAIF's return remains the same as last month with an average effective yield of 4.58% for September 2024. Based on our success at maintaining a competitive rate of return on our portfolio during this period of increasing interest rates, no changes in investment strategy regarding returns on investment are being considered. Under the District's Investment Policy, all District funds continue to be managed based on the objectives, in priority order, of safety, liquidity, and return on investment. PORTFOLIO COMPLIANCE: September 30, 2024 Investment State Limit Otay Limit Otay Actual 8.01: Treasury Securities 100% 100% 5.21% 8.02: Local Agency Investment Fund (Operations) $75 Million $75 Million $63.72 Million 8.03: Federal Agency Issues 100% 100% 29.42% 8.04: Certificates of Deposit 30% 15% 0 8.05: Short-Term Commercial Notes 25% 10% 0 8.06: Medium-Term Commercial Debt 30% 10% 0 8.07: Money Market Mutual Funds 20% 10% 0.23% 8.08: San Diego County Pool 100% 100% 7.91% 12.0: Maximum Single Financial Institution 100% 50% 1.71% $1,966,456 1.71% $72,797,119 63.43% $39,998,864 34.86% Otay Water District Investment Portfolio: 09/30/2024 Banks (Passbook/Checking/CD)Pools (LAIF & County)Agencies,Treasury Securities & Money Market Mutual Funds Total Cash and Investments: $114,762,439 (Book Value) Jul FY24 Aug FY24 Sep FY24 1st Qtr FY24 Oct FY24 Nov FY24 Dec FY24 2nd Qtr FY24 Jan FY24 Feb FY24 Mar FY24 3rd Qtr FY24 Apr FY24 May FY24 Jun FY24 4th Qtr FY24 Jul FY25 Aug FY25 Sep FY25 1st Qtr FY25 Otay 3.71 3.74 3.83 3.76 3.76 3.86 3.90 3.84 3.86 4.01 3.90 3.92 4.04 4.02 4.12 4.06 4.13 4.21 4.23 4.19 LAIF 3.31 3.43 3.53 3.42 3.67 3.84 3.93 3.81 4.01 4.12 4.23 4.12 4.27 4.33 4.48 4.36 4.52 4.58 4.58 4.56 Difference 0.40 0.31 0.30 0.34 0.09 0.02 -0.03 0.03 -0.15 -0.11 -0.33 -0.20 -0.23 -0.31 -0.36 -0.30 -0.39 -0.37 -0.35 -0.37 -1.00 0.00 1.00 2.00 3.00 4.00 5.00 Re t u r n o n I n v e s t m e n t s Month Performance Measure FY-25 Return on Investment Otay LAIF Difference Target: Meet or Exceed 100% of LAIF Month End Portfolio Management September 30, 2024 Portfolio Summary % of Portfolio Book ValueInvestmentsMarket Value Par Value Days to MaturityTerm YTM 360 Equiv. YTM 365 Equiv. Federal Agency Issues- Callable 6,000,000.00 8195.32 4.9931296,011,220.006,000,000.00 5.063 Treasury Securities - Coupon 5,974,727.32 5735.30 5.0242426,008,760.006,000,000.00 5.094 Federal Agency Issues - Bullet 27,765,811.54 95524.62 3.43025627,624,932.6827,796,000.00 3.478 Money Market 258,325.65 10.23 4.7721258,325.65258,325.65 4.838 Local Agency Investment Fund (LAIF)63,720,798.21 156.49 4.512163,852,132.1363,720,798.21 4.575 San Diego County Pool 9,076,320.93 18.05 3.52119,068,000.009,076,320.93 3.570 112,795,983.65 100.00%Investments 112,823,370.46112,851,444.79 310 83 4.220 4.278 Cash (not included in yield calculations) Passbook/Checking 1,966,455.65 1 0.96211,966,455.651,966,455.65 0.976 114,762,439.30Total Cash and Investments 114,789,826.11114,817,900.44 310 83 4.220 4.278 Current Year September 30 395,822.75 Fiscal Year To Date 1,235,253.05 Average Daily Balance Effective Rate of Return 113,792,390.90 116,915,316.28 4.19%4.23% Total Earnings Month Ending I hereby certify that the investments contained in this report are made in accordance with the District Investment Policy Number 27 adopted by the Board of Directors on May 01, 2024. The investments provide sufficient liquidity to meet the cash flow requirements of the District for the next six months of expenditures. __________________________________________________ ____________________ Joseph Beachem, Chief Financial Officer Portfolio OTAY NL! APData Updated: SET_PM1: 10/22/2024 13:59 Reporting period 09/01/2024-09/30/2024 Run Date: 10/22/2024 - 13:59 PM (PRF_PM1) 7.3.11 Report Ver. 7.3.11 1 1 San Diego County Pool September report is not yet finalized. This report is using the estimated September annualized yield that was provided by the County. 10/24/2024 YTM 360 Page 1 Par Value Book Value Maturity Date Stated RateMarket Value September 30, 2024 Portfolio Details - Investments Average BalanceIssuer Portfolio Management Month End Days to MaturityMoody'sCUSIPInvestment #Purchase Date Federal Agency Issues- Callable 4.932Federal Home Loan Mortgage2406 3,000,000.00 3,000,000.00 04/25/20255.00010/25/2022 3,009,810.00 Aaa3134GX6A7 206 5.055Federal Home Loan Mortgage2408 3,000,000.00 3,000,000.00 11/22/20245.12511/28/2022 3,001,410.00 Aaa3134GY3P5 52 6,000,000.006,011,220.006,000,000.006,000,000.00Subtotal and Average 4.993 129 Treasury Securities - Coupon 4.998US TREASURY2418 3,000,000.00 2,992,430.94 07/31/20254.75011/01/2023 3,016,050.00 Aaa91282CHN4 303 5.051US TREASURY2419 3,000,000.00 2,982,296.38 03/31/20253.87511/09/2023 2,992,710.00 Aaa91282CGU9 181 5,974,727.326,008,760.006,000,000.005,972,946.86Subtotal and Average 5.024 242 Federal Agency Issues - Bullet 2.855Federal Farm Credit Bank2397 2,000,000.00 1,998,436.44 04/25/20252.75004/26/2022 1,983,860.00 Aaa3133ENVC1 206 4.261Federal Farm Credit Bank2402 3,000,000.00 2,998,055.42 09/30/20254.25009/30/2022 3,006,660.00 Aaa3133ENP95 364 4.488Federal Farm Credit Bank2405 3,000,000.00 2,999,778.72 10/17/20244.37510/19/2022 2,999,190.00 Aaa3133ENS43 16 4.284Federal Farm Credit Bank2410 3,000,000.00 2,999,413.36 12/20/20244.25012/20/2022 2,995,710.00 Aaa3133EN4N7 80 4.932Federal Farm Credit Bank2420 1,000,000.00 994,910.79 03/05/20264.62504/17/2024 1,011,110.00 Aaa3133EP4K8 520 4.679Federal Farm Credit Bank2421 1,000,000.00 1,000,123.72 05/06/20274.75005/28/2024 1,027,800.00 Aaa3133ERDS7 947 4.864Federal Farm Credit Bank2424 3,000,000.00 2,998,833.39 07/28/20254.87511/17/2023 3,022,770.00 Aaa3133EPRS6 300 4.928Federal Home Loan Bank2417 4,000,000.00 4,000,000.00 02/28/20255.00007/03/2023 4,005,040.00 Aaa3130AV7L0 150 0.612Federal Home Loan Mortgage2391 1,045,000.00 1,042,521.47 09/23/20250.37509/16/2021 1,008,769.85 Aaa3137EAEX3 357 0.618Federal Home Loan Mortgage2392 2,751,000.00 2,744,340.48 09/23/20250.37509/22/2021 2,655,622.83 Aaa3137EAEX3 357 0.996Federal National Mortage Assoc2393 2,000,000.00 2,003,221.03 01/07/20251.62512/09/2021 1,983,860.00 Aaa3135G0X24 98 1.129Federal National Mortage Assoc2394 2,000,000.00 1,986,176.72 11/07/20250.50012/15/2021 1,924,540.00 Aaa3135G06G3 402 27,765,811.5427,624,932.6827,796,000.0028,964,715.12Subtotal and Average 3.430 256 Money Market 4.764Blackrock T - Fund Inst9010 17,172.63 17,172.63 4.83017,172.63RESERVE-10A WRB 1 4.764Blackrock T - Fund Inst9011 38,982.42 38,982.42 4.83038,982.42RESERVE 10 BABS 1 4.774FIRST AMERICAN US TREASURY9016 202,170.60 202,170.60 4.840202,170.60OWD TRUST & CUS 1 258,325.65258,325.65258,325.651,664,738.10Subtotal and Average 4.772 1 Local Agency Investment Fund (LAIF) 4.512STATE OF CALIFORNIA9001 63,720,798.21 63,720,798.21 4.57563,852,132.13LAIF 1 63,720,798.2163,852,132.1363,720,798.2160,100,798.21Subtotal and Average 4.512 1 Portfolio OTAY NL! APData Updated: SET_PM1: 10/22/2024 13:59 Run Date: 10/22/2024 - 13:59 PM (PRF_PM2) 7.3.11 Report Ver. 7.3.11 YTM 360 Page 2 Par Value Book Value Maturity Date Stated RateMarket Value September 30, 2024 Portfolio Details - Investments Average BalanceIssuer Portfolio Management Month End Days to MaturityMoody'sCUSIPInvestment #Purchase Date San Diego County Pool 3.521San Diego County9007 9,076,320.93 9,076,320.93 3.5709,068,000.00SD COUNTY POOL 1 9,076,320.939,068,000.009,076,320.939,076,320.93Subtotal and Average 3.521 1 113,792,390.90 112,851,444.79 4.220 83112,823,370.46 112,795,983.65Total and Average Portfolio OTAY NL! APData Updated: SET_PM1: 10/22/2024 13:59 Run Date: 10/22/2024 - 13:59 PM (PRF_PM2) 7.3.11 YTM 360 Page 3 Par Value Book Value Stated RateMarket Value September 30, 2024 Portfolio Details - Cash Average BalanceIssuer Portfolio Management Month End Days to MaturityMoody'sCUSIPInvestment #Purchase Date US Bank 0.000STATE OF CALIFORNIA9003 3,100.00 3,100.003,100.00PETTY CASH 1 0.986STATE OF CALIFORNIA9004 1,918,723.50 1,918,723.50 1.0001,918,723.50OPERATING 1 0.000STATE OF CALIFORNIA9005 10,009.78 10,009.7807/01/2024 10,009.78PAYROLL 1 0.000STATE OF CALIFORNIA9014 34,622.37 34,622.3707/01/2024 34,622.37FLEX ACCT 1 0.00 113,792,390.90 114,817,900.44 4.220 83 1Average Balance 114,789,826.11 114,762,439.30Total Cash and Investments Portfolio OTAY NL! APData Updated: SET_PM1: 10/22/2024 13:59 Run Date: 10/22/2024 - 13:59 PM (PRF_PM2) 7.3.11 Month End Activity Report Sorted By Issuer September 1, 2024 - September 30, 2024 Current Rate Transaction Date BalanceBeginning Balance Ending Par Value Percent of Portfolio Par Value CUSIP Investment #Issuer Purchases or Deposits Redemptions or Withdrawals Issuer: Blackrock T - Fund Inst Money Market Blackrock T - Fund Inst9010 2,026.134.830 0.00RESERVE-10A WRB Blackrock T - Fund Inst9011 5,306.534.830 0.00RESERVE 10 BABS 0.0048,822.39 56,155.05Subtotal and Balance 7,332.66 7,332.66 0.0048,822.39 56,155.050.049%Issuer Subtotal Issuer: STATE OF CALIFORNIA US Bank STATE OF CALIFORNIA9004 994,512.891.000 40,199.72OPERATING STATE OF CALIFORNIA9005 0.00 683.07PAYROLL STATE OF CALIFORNIA9014 332.97 10,585.77FLEX ACCT 51,468.561,023,078.35 1,966,455.65Subtotal and Balance 994,845.86 Local Agency Investment Fund (LAIF) STATE OF CALIFORNIA9001 11,200,000.004.575 8,800,000.00LAIF 8,800,000.0061,320,798.21 63,720,798.21Subtotal and Balance 11,200,000.00 12,194,845.86 8,851,468.5662,343,876.56 65,687,253.8657.210%Issuer Subtotal Issuer: FIRST AMERICAN US TREASURY Money Market FIRST AMERICAN US TREASURY9016 3,212,805.464.840 3,600,000.00OWD TRUST & CUS 3,600,000.00589,365.14 202,170.60Subtotal and Balance 3,212,805.46 3,212,805.46 3,600,000.00589,365.14 202,170.600.176%Issuer Subtotal Issuer: Federal Farm Credit Bank Federal Agency Issues - Bullet 16,000,000.00 16,000,000.00Subtotal and Balance Portfolio OTAY NL! APData Updated: SET_PM1: 10/22/2024 13:59 Run Date: 10/22/2024 - 13:59 DA (PRF_DA) 7.3.11 Report Ver. 7.3.11 Current Rate Transaction Date BalanceBeginning Balance Ending Par Value Page 2 Percent of Portfolio Par Value September 1, 2024 - September 30, 2024 Activity Report Month End CUSIP Investment #Issuer Purchases or Deposits Redemptions or Withdrawals 0.00 0.0016,000,000.00 16,000,000.0013.935%Issuer Subtotal Issuer: Federal Home Loan Bank Federal Agency Issues - Bullet Federal Home Loan Bank2404 0.004.375 09/13/2024 3,000,000.003130ATND5 3,000,000.007,000,000.00 4,000,000.00Subtotal and Balance 0.00 0.00 3,000,000.007,000,000.00 4,000,000.003.484%Issuer Subtotal Issuer: Federal Home Loan Mortgage Federal Agency Issues- Callable 6,000,000.00 6,000,000.00Subtotal and Balance Federal Agency Issues - Bullet 3,796,000.00 3,796,000.00Subtotal and Balance 0.00 0.009,796,000.00 9,796,000.008.532%Issuer Subtotal Issuer: Federal National Mortage Assoc Federal Agency Issues - Bullet 4,000,000.00 4,000,000.00Subtotal and Balance 0.00 0.004,000,000.00 4,000,000.003.484%Issuer Subtotal Issuer: San Diego County San Diego County Pool San Diego County9007 88,203.953.570 0.00SD COUNTY POOL 0.008,988,116.98 9,076,320.93Subtotal and Balance 88,203.95 88,203.95 0.008,988,116.98 9,076,320.937.905%Issuer Subtotal Issuer: US TREASURY Treasury Securities - Coupon 6,000,000.00 6,000,000.00Subtotal and Balance Portfolio OTAY NL! APData Updated: SET_PM1: 10/22/2024 13:59 Run Date: 10/22/2024 - 13:59 DA (PRF_DA) 7.3.11 Report Ver. 7.3.11 Current Rate Transaction Date BalanceBeginning Balance Ending Par Value Page 3 Percent of Portfolio Par Value September 1, 2024 - September 30, 2024 Activity Report Month End CUSIP Investment #Issuer Purchases or Deposits Redemptions or Withdrawals 0.00 0.006,000,000.00 6,000,000.005.226%Issuer Subtotal 114,766,181.07 114,817,900.44Total15,451,468.5615,503,187.93100.000% Portfolio OTAY NL! APData Updated: SET_PM1: 10/22/2024 13:59 Run Date: 10/22/2024 - 13:59 DA (PRF_DA) 7.3.11 Report Ver. 7.3.11 Month End Duration Report Sorted by Investment Type - Investment Type Through 09/30/2024 Investment #Security ID Issuer Investment Class Book Value Par Value Market Value Current Rate YTM Current Yield Maturity/ Call Date DurationModified360Fund Federal Home Loan Mortgage240699 3,000,000.00 3,009,810.003134GX6A7 4.415 04/25/2025 0.5423,000,000.00 4.932Fair5.0000000 Federal Home Loan Mortgage240899 3,000,000.00 3,001,410.003134GY3P5 5.296 11/22/2024 0.1423,000,000.00 5.055Fair5.1250000 US TREASURY241899 3,000,000.00 3,016,050.0091282CHN4 4.097 07/31/2025 0.8032,992,430.94 4.998Fair4.7500000 US TREASURY241999 3,000,000.00 2,992,710.0091282CGU9 4.386 03/31/2025 0.4952,982,296.38 5.051Fair3.8750000 Federal Home Loan Mortgage239199 1,045,000.00 1,008,769.853137EAEX3 4.027 09/23/2025 0.9571,042,521.47 0.612Fair.37500000 Federal Home Loan Mortgage239299 2,751,000.00 2,655,622.833137EAEX3 4.027 09/23/2025 0.9572,744,340.48 0.618Fair.37500000 Federal National Mortage Assoc239399 2,000,000.00 1,983,860.003135G0X24 4.640 01/07/2025 0.2682,003,221.03 0.996Fair1.6250000 Federal National Mortage Assoc239499 2,000,000.00 1,924,540.003135G06G3 4.042 11/07/2025 1.0741,986,176.72 1.129Fair.50000000 Federal Farm Credit Bank239799 2,000,000.00 1,983,860.003133ENVC1 4.209 04/25/2025 0.5471,998,436.44 2.855Fair2.7500000 Federal Farm Credit Bank240299 3,000,000.00 3,006,660.003133ENP95 4.021 09/30/2025 0.9672,998,055.42 4.261Fair4.2500000 Federal Farm Credit Bank240599 3,000,000.00 2,999,190.003133ENS43 4.852 10/17/2024 0.0432,999,778.72 4.488Fair4.3750000 Federal Farm Credit Bank241099 3,000,000.00 2,995,710.003133EN4N7 4.843 12/20/2024 0.2192,999,413.36 4.284Fair4.2500000 Federal Home Loan Bank241799 4,000,000.00 4,005,040.003130AV7L0 4.667 02/28/2025 0.4104,000,000.00 4.928Fair5.0000000 Federal Farm Credit Bank242099 1,000,000.00 1,011,110.003133EP4K8 3.820 03/05/2026 1.368994,910.79 4.932Fair4.6250000 Federal Farm Credit Bank242199 1,000,000.00 1,027,800.003133ERDS7 3.620 05/06/2027 2.3881,000,123.72 4.679Fair4.7500000 Federal Farm Credit Bank242499 3,000,000.00 3,022,770.003133EPRS6 3.937 07/28/2025 0.7972,998,833.39 4.864Fair4.8750000 Blackrock T - Fund Inst901099 17,172.63 17,172.63RESERVE-10A 4.830 0.00017,172.63 4.764Amort4.8300000 Blackrock T - Fund Inst901199 38,982.42 38,982.42RESERVE 10 4.830 0.00038,982.42 4.764Amort4.8300000 FIRST AMERICAN US TREASURY901699 202,170.60 202,170.60OWD TRUST &4.840 0.000202,170.60 4.774Amort4.8400000 STATE OF CALIFORNIA900199 63,720,798.21 63,852,132.13LAIF 4.575 0.00063,720,798.21 4.512Fair4.5750000 San Diego County900799 9,076,320.93 9,068,000.00SD COUNTY 3.570 0.0009,076,320.93 3.521Fair3.5700000 4.430 0.219112,795,983.65 112,851,444.79 112,823,370.46Report Total † = Duration can not be calculated on these investments due to incomplete Market price data. Portfolio OTAY NL! APPage 1Data Updated: SET_PM1: 10/22/2024 13:59 Run Date: 10/22/2024 - 13:59 DU (PRF_DU) 7.3.11 Report Ver. 7.3.11 Month End GASB 31 Compliance Detail Sorted by Fund - Fund September 1, 2024 - September 30, 2024 Investment #Maturity Date Beginning Invested Value Purchase of Principal InvestmentClassFundCUSIP Adjustment in Value Ending Invested Value Addition to Principal Redemption of Principal Amortization Adjustment Change in Market Value Fund: Treasury Fund 2391 1,002,196.80Fair Value 09/23/2025 6,573.0599 1,008,769.853137EAEX30.00 0.00 0.00 0.00 2408 3,000,270.00Fair Value 11/22/2024 1,140.0099 3,001,410.003134GY3P50.00 0.00 0.00 0.00 2406 3,004,920.00Fair Value 04/25/2025 4,890.0099 3,009,810.003134GX6A70.00 0.00 0.00 0.00 2392 2,638,319.04Fair Value 09/23/2025 17,303.7999 2,655,622.833137EAEX30.00 0.00 0.00 0.00 2393 1,976,720.00Fair Value 01/07/2025 7,140.0099 1,983,860.003135G0X240.00 0.00 0.00 0.00 2394 1,913,980.00Fair Value 11/07/2025 10,560.0099 1,924,540.003135G06G30.00 0.00 0.00 0.00 2404 2,999,190.00Fair Value 09/13/2024 810.0099 0.003130ATND50.00 0.00 3,000,000.00 0.00 2417 4,002,360.00Fair Value 02/28/2025 2,680.0099 4,005,040.003130AV7L00.00 0.00 0.00 0.00 9001 61,094,894.96Fair Value 357,237.1699 63,852,132.13LAIF0.00 11,200,000.00 8,800,000.00 0.00 9004 964,410.33Amortized 0.0099 1,918,723.50OPERATING0.00 994,512.89 40,199.72 0.00 9014 44,875.17Amortized 0.0099 34,622.37FLEX ACCT 0.00 332.97 10,585.77 0.00 9005 10,692.85Amortized 0.0099 10,009.78PAYROLL0.00 0.00 683.07 0.00 9003 3,100.00Amortized 0.0099 3,100.00PETTY CASH 0.00 0.00 0.00 0.00 2397 1,975,380.00Fair Value 04/25/2025 8,480.0099 1,983,860.003133ENVC10.00 0.00 0.00 0.00 2402 2,999,430.00Fair Value 09/30/2025 7,230.0099 3,006,660.003133ENP950.00 0.00 0.00 0.00 2405 2,996,490.00Fair Value 10/17/2024 2,700.0099 2,999,190.003133ENS430.00 0.00 0.00 0.00 2424 3,011,790.00Fair Value 07/28/2025 10,980.0099 3,022,770.003133EPRS60.00 0.00 0.00 0.00 2420 1,006,810.00Fair Value 03/05/2026 4,300.0099 1,011,110.003133EP4K80.00 0.00 0.00 0.00 2410 2,992,650.00Fair Value 12/20/2024 3,060.0099 2,995,710.003133EN4N70.00 0.00 0.00 0.00 2421 1,022,480.00Fair Value 05/06/2027 5,320.0099 1,027,800.003133ERDS70.00 0.00 0.00 0.00 2418 3,007,920.00Fair Value 07/31/2025 8,130.0099 3,016,050.0091282CHN40.00 0.00 0.00 0.00 2419 2,985,900.00Fair Value 03/31/2025 6,810.0099 2,992,710.0091282CGU90.00 0.00 0.00 0.00 9007 8,930,461.00Fair Value 49,335.0599 9,068,000.00SD COUNTY POOL 0.00 88,203.95 0.00 0.00 9016 589,365.14Amortized 0.0099 202,170.60OWD TRUST & CUS 0.00 3,212,805.46 3,600,000.00 0.00 9010 15,146.50Amortized 0.0099 17,172.63RESERVE-10A WRB 0.00 2,026.13 0.00 0.00 9011 33,675.89Amortized 0.0099 38,982.42RESERVE 10 BABS 0.00 5,306.53 0.00 0.00 114,223,427.68Subtotal 514,679.05 114,789,826.110.00 15,503,187.93 15,451,468.56 0.00 114,223,427.68Total 114,789,826.11514,679.050.00 15,503,187.93 15,451,468.56 0.00 Portfolio OTAY NL! APData Updated: SET_PM1: 10/22/2024 13:59 Run Date: 10/22/2024 - 13:59 GD (PRF_GD) 7.3.11 Report Ver. 7.3.11 Month End Interest Earnings Sorted by Fund - Fund September 1, 2024 - September 30, 2024 Yield on Beginning Book Value Maturity Date Current Rate Ending Par Value EndingSecurityTypeFundBook ValueBeginningBook Value Adjusted Interest Earnings Accretion Amortization/ Earnings Adjusted InterestAnnualized YieldCUSIPInvestment #Interest Earned Fund: Treasury Fund 1,042,521.4723911,045,000.00 0.375FAC09/23/2025 326.56 211.24 537.800.628991,042,310.233137EAEX3 3,000,000.0024083,000,000.00 5.125MC111/22/2024 12,812.50 0.00 12,812.505.196993,000,000.003134GY3P5 3,000,000.0024063,000,000.00 5.000MC104/25/2025 12,500.00 0.00 12,500.005.069993,000,000.003134GX6A7 2,744,340.4823922,751,000.00 0.375FAC09/23/2025 859.69 567.57 1,427.260.633992,743,772.913137EAEX3 2,003,221.0323932,000,000.00 1.625FAC01/07/2025 2,708.33 -1,006.57 1,701.761.033992,004,227.603135G0X24 1,986,176.7223942,000,000.00 0.500FAC11/07/2025 833.33 1,047.22 1,880.551.153991,985,129.503135G06G3 0.0024040.00 4.375FAC09/13/2024 4,375.00 21.02 4,396.024.457992,999,978.983130ATND5 4,000,000.0024174,000,000.00 5.000FAC02/28/2025 16,666.66 0.00 16,666.665.069994,000,000.003130AV7L0 63,720,798.21900163,720,798.21 4.575LA1 225,995.46 0.00 225,995.464.4849961,320,798.21LAIF 1,918,723.5090041,918,723.50 1.000PA1 1,607.67 0.00 1,607.672.02899964,410.33OPERATING 34,622.37901434,622.37PA1 0.00 0.00 0.009944,875.17FLEX ACCT 10,009.78900510,009.78PA1 0.00 0.00 0.009910,692.85PAYROLL 3,100.0090033,100.00PA1 0.00 0.00 0.00993,100.00PETTY CASH 1,998,436.4423972,000,000.00 2.750FAC04/25/2025 4,583.33 229.93 4,813.262.931991,998,206.513133ENVC1 2,998,055.4224023,000,000.00 4.250FAC09/30/2025 10,625.00 162.50 10,787.504.378992,997,892.923133ENP95 2,999,778.7224053,000,000.00 4.375FAC10/17/2024 10,937.50 414.90 11,352.404.605992,999,363.823133ENS43 2,998,833.3924243,000,000.00 4.875FAC07/28/2025 12,187.50 117.84 12,305.344.993992,998,715.553133EPRS6 994,910.7924201,000,000.00 4.625FAC03/05/2026 3,854.17 297.03 4,151.205.07899994,613.763133EP4K8 2,999,413.3624103,000,000.00 4.250FAC12/20/2024 10,625.00 222.78 10,847.784.401992,999,190.583133EN4N7 1,000,123.7224211,000,000.00 4.750FAC05/06/2027 3,958.33 -3.97 3,954.364.811991,000,127.693133ERDS7 2,992,430.9424183,000,000.00 4.750TRC07/31/2025 11,616.85 749.42 12,366.275.029992,991,681.5291282CHN4 2,982,296.3824193,000,000.00 3.875TRC03/31/2025 9,530.44 2,934.30 12,464.745.090992,979,362.0891282CGU9 9,076,320.9390079,076,320.93 3.570LA3 26,632.17 0.00 26,632.173.605998,988,116.98SD COUNTY POOL 202,170.609016202,170.60 4.840PA2 6,419.90 0.00 6,419.9013.25399589,365.14OWD TRUST & CUS 17,172.63901017,172.63 4.830PA2 62.45 0.00 62.455.0169915,146.50RESERVE-10A WRB 38,982.42901138,982.42 4.830PA2 139.70 0.00 139.705.0479933,675.89RESERVE 10 BABS 114,817,900.44Subtotal 114,762,439.30 4.196 395,822.755,965.21389,857.54114,704,754.72 114,817,900.44Total 114,762,439.30 4.196 395,822.755,965.21389,857.54114,704,754.72 Portfolio OTAY NL! APData Updated: SET_PM1: 10/22/2024 13:59 Run Date: 10/22/2024 - 13:59 IE (PRF_IE) 7.3.11 Report Ver. 7.3.11 Check Total 1,842.28 720.00 294.50 CHECK REGISTER Otay Water District Date Range: 9/19/2024 - 10/23/2024 Check #Date Vendor Vendor Name Invoice Inv. Date Description Amount 2062648 10/16/24 15416 24 HOUR ELEVATOR INC 176568 10/01/24 ELEVATOR GENERAL MAINTENANCE 638.69 638.69 2062617 10/09/24 08488 ABLEFORCE INC 12609 10/03/24 SHAREPOINT & INTRANET SUPPORT SVCS 150.00 150.00 2062649 10/16/24 18122 ACC BUSINESS 242619576 09/27/24 INTERNET CIRCUITS (SEPT 2024)1,691.06 1,691.06 2062618 10/09/24 22620 ADAM HAWKINS Ref002743801 10/04/24 UB Refund Cst #0000208125 285.78 285.78 2062571 10/02/24 07732 AIRGAS SPECIALTY PRODUCTS INC 9153603263 09/10/24 AS-NEEDED AQUA AMMONIA 1,394.96 9153603258 09/10/24 AS-NEEDED AQUA AMMONIA 447.32 2062619 10/09/24 22342 AKESO OCCUPATIONAL HEALTH 9402609 07/15/24 EMPLOYEE HEALTH EXAMS 270.00 9408194 08/15/24 EMPLOYEE HEALTH EXAMS 270.00 9412270 09/16/24 EMPLOYEE HEALTH EXAMS 180.00 2062650 10/16/24 18296 ALBIREO ENERGY LLC PIN0039711 10/11/24 FY25 FIRE ALARM ANNUAL SERVICES 416.00 416.00 2062572 10/02/24 22611 ALEX AGUILAR D1140-090566 09/12/24 1303 & 1236 BUENA VISTA 18,993.03 18,993.03 2062620 10/09/24 22624 ALEXANDER SUGGS Ref002743805 10/04/24 UB Refund Cst #0000275249 89.20 89.20 2062651 10/16/24 22138 AMERIFLEX 777632 10/02/24 BILLING ADMINISTRATION 214.50 775208 10/02/24 BILLING ADMINISTRATION 80.00 2062652 10/16/24 22601 AMETEK MAGNETROL USA LLC 0943335 09/26/24 1100-1 HS LEVEL INSTRUMENT 7,645.01 7,645.01 2062573 10/02/24 21641 AQUATIC INFORMATICS INC.110266 09/18/24 FY25 TREATMENT PLANT REPORTING TOOL 9,983.46 9,983.46 2062621 10/09/24 22623 ARON BERNABE Ref002743804 10/04/24 UB Refund Cst #0000274011 182.70 182.70 2062691 10/23/24 17264 ARTIANO SHINOFF ABED 309085 10/16/24 PROF SERV - SEPT 2024 39,193.29 39,193.29 2062554 09/25/24 17264 ARTIANO SHINOFF ABED 308962 09/17/24 PROF SERV - AUG 2024 68,566.43 68,566.43 2062549 09/25/24 22607 ARTURO LOPEZ Ref002743677 09/23/24 UB Refund Cst #0000290503 53.48 53.48 2062622 10/09/24 20199 ASSOC OF CA WATER AGENCIES 93024 09/30/24 FY25 WORKERS' COMP PROGRAM (QTR 1)81,297.75 81,297.75 2062574 10/02/24 07785 AT&T 000022275556 09/12/24 TELEPHONE SERVICES (8/12/24 - 9/11/24)3,644.62 3,644.62 2062653 10/16/24 20125 AZTEC LANDSCAPING INC J1884 09/30/24 FY25 JANITORIAL SERVICES 8,749.50 8,749.50 2062692 10/23/24 22637 BALDWIN & SONS LLC Ref002748170 10/21/24 UB Refund Cst #0000232440 2,046.00 2,046.00 2062623 10/09/24 22618 BERTHA GUZMAN Ref002743799 10/04/24 UB Refund Cst #0000064759 157.36 157.36 2062555 09/25/24 22022 BLUE STONE PROPERTY MANAGEMENT Ref002743676 09/23/24 UB Refund Cst #0000286935 113.34 113.34 Page 1 of 8 1,343.48 2062555 09/25/24 22022 BLUE STONE PROPERTY MANAGEMENT Ref002743676 09/23/24 UB Refund Cst #0000286935 113.34 113.34 2062575 10/02/24 22612 BRABHAM STREET LP D1189-090643 09/12/24 REPAIR 1451 BRABHAM ST 2,990.97 2,990.97 2062576 10/02/24 04209 BRAX COMPANY INC 54335 09/12/24 PUMP #4 REPAIR AT 978 PS 47,762.47 47,762.47 2062654 10/16/24 21775 BRINKS INC 12742829 10/01/24 ARMORED TRANSPORTATION SERVICES FY25 322.38 322.38 2062556 09/25/24 08156 BROWNSTEIN HYATT FARBER 1000608 09/05/24 LEGISLATIVE ADVOCACY CONSULTING SERV 11,010.04 11,010.04 2062624 10/09/24 08156 BROWNSTEIN HYATT FARBER 1005255 10/04/24 LEGISLATIVE ADVOCACY CONSULTING SERV 1,763.51 1,763.51 2062655 10/16/24 03005 BURKE WILLIAMS & SORENSEN LLP 328548 09/23/24 LEGAL CONSULTING SERV FOR MOU & HRA 268.50 268.50 2062577 10/02/24 18665 BURTECH PIPELINE INC 308312024 09/05/24 OLYMPIC PARKWAY RW PIPELINE (AUG 2024)507,547.00 507,547.00 2062557 09/25/24 20581 CAL PACIFIC TRUCK CENTER LLC 01SDW36336 09/12/24 212 ENGINE REPAIR 4,031.93 4,031.93 2062656 10/16/24 20374 CALBURTON INC CAL1881 09/20/24 UTILITY LOCATING SERVICES (AUG 2024)10,821.25 10,821.25 2062558 09/25/24 04653 CARO, PATRICIA 092324 09/23/24 EXPENSE REIMBURSEMENT 1,210.52 091824 09/18/24 EXPENSE REIMBURSEMENT 132.96 2062578 10/02/24 15177 CAROLLO ENGINEERS INC FB56165 09/12/24 SWA/OWD RW INT PROJ PLAN (AUG 2024)14,919.00 14,919.00 2062657 10/16/24 20245 CB PACIFIC INC.30379281 09/19/24 FY25 EMERSON SOFTWARE SUPP RENEW 2,278.48 2,278.48 2062559 09/25/24 18170 CED INDUSTRIAL & LIGHT 7148-1018783 09/16/24 PS STARTER 4,310.00 4,310.00 2062658 10/16/24 21705 CHAMBERS GROUP INC 37431 09/24/24 ENVIRONMENTAL SERVICES (7/1/24-8/31/24)1,454.10 1,454.10 2062579 10/02/24 22613 COAST CITRUS DISTRIBUTORS D1180-090630 09/12/24 RPDA REPAIR 3,982.04 3,982.04 2062580 10/02/24 22603 COMPUTER BUSINESS CONSULTANTS 121120 09/17/24 DELL NETWORKING EQUIPMENT SUPP SERV 21,175.64 21,175.64 2062659 10/16/24 15049 CORELOGIC SOLUTIONS LLC 82223683 09/30/24 REALQUEST PROPERTY DATA 540.75 540.75 2062560 09/25/24 15049 CORELOGIC SOLUTIONS LLC 82222487 08/31/24 REALQUEST PROPERTY DATA 540.75 540.75 2062660 10/16/24 00099 COUNTY OF SAN DIEGO MWD-0824 09/30/24 EXCAVATION PERMITS (AUG 2024)533.50 533.50 2062561 09/25/24 00099 COUNTY OF SAN DIEGO MWD-0724 08/28/24 EXCAVATION PERMITS (JULY 2024)1,135.00 1,135.00 2062625 10/09/24 22627 CRAIG STANZIANO Ref002743809 10/04/24 UB Refund Cst #0000297836 27.36 27.36 2062661 10/16/24 11797 D&H WATER SYSTEMS INC 2024-1247 09/20/24 CHLORINE GAS VACUUM SWITCHES 3,667.36 3,667.36 2062616 10/09/24 22571 DANIEL LUU Ref002743797 10/04/24 UB Refund Cst #0000003463 88.43 88.43 2062550 09/25/24 22606 DANNY ROYSE Ref002743675 09/23/24 UB Refund Cst #0000229953 23.06 23.06 2062551 09/25/24 22604 DAWN GAIN Ref002743673 09/23/24 UB Refund Cst #0000020173 14.95 14.95 2062581 10/02/24 04272 DEPT OF INDUSTRIAL RELATIONS 1677210 09/30/24 DEPT OF INDUSTRIAL RELATIONS ASSESS 7,685.00 7,685.00 2062626 10/09/24 04272 DEPT OF INDUSTRIAL RELATIONS 1677210 09/30/24 DEPT OF INDUSTRIAL RELATIONS ASSESS 7,685.00 7,685.00 2062582 10/02/24 21100 DIVISION OF EMPLOYMENT EMP ID 0000870440 07/22/24 AR NUMBER 9981054 - TAX ASSESSMENT 74.12 74.12 Page 2 of 8 13,766.95 19,191.95 2062662 10/16/24 19059 DRONEDEPLOY INC 13894 09/27/24 FY25 DRONEDEPLOY SOFTWARE LICENSE 17,999.00 17,999.00 2062627 10/09/24 02447 EDCO DISPOSAL CORPORATION 5458 093024 09/30/24 FY25 RECYCLED WASTE SERVICE 258.18 258.18 2062562 09/25/24 20794 ENTISYS 360 219461 09/23/24 FY25 MICROSOFT CSP RENEWAL 9,268.12 9,268.12 2062663 10/16/24 20794 ENTISYS 360 219608 09/23/24 MS LIC & HARDWARE/SOFTWARE MAINT 40,715.99 40,715.99 2062628 10/09/24 22621 ERIC ONEAL Ref002743802 10/04/24 UB Refund Cst #0000226299 117.20 117.20 2062629 10/09/24 20511 EYEMED (FIDELITY)166465366 09/20/24 CY24 VISION BENEFITS ADMINISTRATION 1,398.04 1,398.04 2062583 10/02/24 03546 FERGUSON WATERWORKS # 1083 0861546 09/12/24 INVENTORY 8,148.86 0863936 09/11/24 INVENTORY 3,891.93 0863327 09/11/24 INVENTORY 1,726.16 2062664 10/16/24 03546 FERGUSON WATERWORKS # 1083 0864485 09/20/24 INVENTORY 4,825.39 4,825.39 2062665 10/16/24 02591 FITNESS TECH 12802 10/01/24 FY25 GYM EQUIPMENT MAINTENANCE 150.00 150.00 2062630 10/09/24 22610 FRANCHISE TAX BOARD Ben2743857 10/10/24 BI-WEEKLY PAYROLL DEDUCTION 516.39 516.39 2062687 10/23/24 22638 FRANCISCO MAGANA Ref002748171 10/21/24 UB Refund Cst #0000268337 226.40 226.40 2062631 10/09/24 22628 FRANCISCO RIVERA 090424093024 09/30/24 MILEAGE REIMBURSEMENT 17.42 17.42 2062584 10/02/24 03537 GHA TECHNOLOGIES INC 11420957 09/11/24 HP ELITE MINI DESKTOP COMPUTERS 13,278.46 13,278.46 2062693 10/23/24 22023 GSE CONSTRUCTION CO INC 407312024 09/05/24 DISINFECT SYS IMPROVE (JULY 2024)664,134.13 664,134.13 2062632 10/09/24 22617 HAL OKEY Ref002743798 10/04/24 UB Refund Cst #0000056389 65.57 65.57 2062585 10/02/24 19978 HASA INC.991564 09/09/24 FY25 AS-NEEDED SODIUM HYPOCHLORITE 3,552.97 992615 09/12/24 FY25 AS-NEEDED SODIUM HYPOCHLORITE 2,963.77 990872 09/05/24 FY25 AS-NEEDED SODIUM HYPOCHLORITE 2,718.02 992617 09/12/24 FY25 AS-NEEDED SODIUM HYPOCHLORITE 2,709.14 992618 09/12/24 FY25 AS-NEEDED SODIUM HYPOCHLORITE 2,590.70 990875 09/05/24 FY25 AS-NEEDED SODIUM HYPOCHLORITE 2,013.35 990874 09/05/24 FY25 AS-NEEDED SODIUM HYPOCHLORITE 962.26 992616 09/12/24 FY25 AS-NEEDED SODIUM HYPOCHLORITE 897.12 991195 09/06/24 FY25 AS-NEEDED SODIUM HYPOCHLORITE 429.32 992613 09/12/24 FY25 AS-NEEDED SODIUM HYPOCHLORITE 355.30 2062563 09/25/24 19978 HASA INC.989950 09/03/24 FY25 AS-NEEDED SODIUM HYPOCHLORITE 5,181.41 5,181.41 2062666 10/16/24 19978 HASA INC.994220 09/19/24 FY25 AS-NEEDED SODIUM HYPOCHLORITE 7,745.47 996457 09/30/24 FY25 AS-NEEDED SODIUM HYPOCHLORITE 4,017.81 994842 09/23/24 FY25 AS-NEEDED SODIUM HYPOCHLORITE 3,659.56 995755 09/26/24 FY25 AS-NEEDED SODIUM HYPOCHLORITE 3,552.97 994221 09/19/24 FY25 AS-NEEDED SODIUM HYPOCHLORITE 3,396.04 Page 3 of 8 33,004.09 181.76 3,014.44 20,763.29 995757 09/26/24 FY25 AS-NEEDED SODIUM HYPOCHLORITE 3,286.49 994205 09/19/24 FY25 AS-NEEDED SODIUM HYPOCHLORITE 2,812.76 994223 09/19/24 FY25 AS-NEEDED SODIUM HYPOCHLORITE 2,072.56 995756 09/26/24 FY25 AS-NEEDED SODIUM HYPOCHLORITE 1,157.67 994207 09/19/24 FY25 AS-NEEDED SODIUM HYPOCHLORITE 829.03 995754 09/26/24 FY25 AS-NEEDED SODIUM HYPOCHLORITE 473.73 2062633 10/09/24 22165 HEALTH AND HUMAN RESOURCE E0330386 10/03/24 AETNA EMPLOYEE ASSISTANCE PROGRAM 202.94 202.94 2062694 10/23/24 00062 HELIX WATER DISTRICT 25458310924 10/09/24 WATER USAGE (8/8/24-10/4/24)117.44 24330010924 10/09/24 WATER USAGE (8/8/24-10/4/24)64.32 2062667 10/16/24 21322 HPS WEST INC.0003169 09/30/24 9.5' ANTENNAS FOR AMI 3,256.09 3,256.09 2062688 10/23/24 22640 INAS ALDAFFAIE Ref002748173 10/21/24 UB Refund Cst #0000291271 47.11 47.11 2062586 10/02/24 08969 INFOSEND INC 271276 09/16/24 BILL PROCESSING SERVICES FY25 2,714.44 270954 09/10/24 BILL PROCESSING SERVICES FY25 300.00 2062668 10/16/24 08969 INFOSEND INC 272404 09/30/24 BILL PROCESSING SERVICES FY25 14,857.35 272403 09/30/24 BILL PROCESSING SERVICES FY25 5,905.94 2062587 10/02/24 15306 INLAND KENWORTH (US) INC 89212 09/27/24 KENWORTH T380 CLASS 7 UTILITY TRUCK 347,172.85 347,172.85 2062689 10/23/24 22639 IVONNE ROMERO Ref002748172 10/21/24 UB Refund Cst #0000291259 115.73 115.73 2062588 10/02/24 20752 IWG TOWERS ASSETS II LLC 4722333 10/01/24 FY25 ANTENNA SUBLEASE 2,355.00 2,355.00 2062669 10/16/24 10563 JCI JONES CHEMICALS INC 951775 09/24/24 FY25 AS-NEEDED CHLORINE GAS 7,650.00 7,650.00 2062552 09/25/24 22608 JOHN COOMES Ref002743678 09/23/24 UB Refund Cst #0000291703 17.23 17.23 2062695 10/23/24 22642 JOSEPH SPENCER 9303102124 10/21/24 CUSTOMER REFUND 203.26 203.26 2062670 10/16/24 22129 KEPT COMPANIES INC Q338771 09/27/24 AS-NEEDED FLEET WASHING SVCS FY25 119.45 119.45 2062589 10/02/24 22129 KEPT COMPANIES INC Q328697 09/13/24 AS-NEEDED FLEET WASHING SVCS FY25 91.89 91.89 2062696 10/23/24 14808 KOEPPEN, KEVIN 102224 10/22/24 EXPENSE REIMBURSEMENT 560.00 560.00 2062590 10/02/24 22569 L&N MOBILE WELDING SERV 917 09/09/24 CONSTRUCTION METER SUPPORT STANDS 1,675.70 1,675.70 2062671 10/16/24 21524 LINDSAY POLIC CONSULTING INC 4017 10/01/24 GEN HEALTH & SAFETY CONSULTING SUPP 945.00 945.00 2062591 10/02/24 21255 LONG, MICHAEL 1892092624 09/26/24 ADVANCEMENT 207.00 207.00 2062697 10/23/24 03019 LOPEZ, JOSE 090124093024 09/30/24 MILEAGE REIMBURSEMENT 226.46 226.46 2062634 10/09/24 22619 LORAYNE SONNABAUM Ref002743800 10/04/24 UB Refund Cst #0000196188 29.11 29.11 2062690 10/23/24 22636 LORENZO CLARK Ref002748169 10/21/24 UB Refund Cst #0000147075 100.00 100.00 2062592 10/02/24 19109 M K DEVELOPERS INC D1095-090474 09/12/24 1041 CORONADO AVE 2,953.84 2,953.84 2062635 10/09/24 22626 MARTHA VILLALOBOS Ref002743808 10/04/24 UB Refund Cst #0000294436 64.99 64.99 Page 4 of 8 19,775.85 8,358.40 7,522.56 2,428.10 5,170.00 2062635 10/09/24 22626 MARTHA VILLALOBOS Ref002743808 10/04/24 UB Refund Cst #0000294436 64.99 64.99 2062672 10/16/24 15599 MARTINEZ, JOSE 101524 10/15/24 EXPENSE REIMBURSEMENT 246.99 246.99 2062673 10/16/24 21723 MERINO LANDSCAPE INC 11547 09/30/24 ADMIN LANDSCAPE UPGRADE MAINT 945.00 945.00 2062593 10/02/24 01824 MERKEL & ASSOCIATES INC 24091701 09/17/24 SMA HABITAT MANAGEMENT (7/1/24-8/31/24)12,178.40 24091702 09/17/24 SMA HABITAT MANAGEMENT (7/1/24-8/31/24)7,597.45 2062698 10/23/24 00805 METRO WASTEWATER JPA 377 07/02/24 MEMBERSHIPS AND DUES 6,376.00 6,376.00 2062699 10/23/24 11367 MIGUEL MARTINEZ 1319102224 10/22/24 CUSTOMER REFUND 1,013.03 1,013.03 2062594 10/02/24 20334 MODERN CUSTOM FABRICATION INC 51501 09/18/24 PRESSURE VESSEL FOR ROLLING HILLS PUMP STATION152,270.78 152,270.78 2062674 10/16/24 17261 NATURESCAPE SERVICES 9046 09/30/24 LANDSCAPE MAINTENANCE SERVICES 9,999.00 9,999.00 2062700 10/23/24 18172 NIGHTCODERS 1278 10/11/24 WEBSITE MAINTENANCE SUPP & CONSULTING 2,530.00 2,530.00 2062595 10/02/24 20996 NORTH CAROLINA DEPT OF REVENUE 601397030 09/30/24 WITHHOLDING TAX 093024 241.50 241.50 2062596 10/02/24 07447 NTU TECHNOLOGIES INC 12941 09/18/24 POLYMER 908 12,094.18 12,094.18 2062701 10/23/24 18332 NV5 INC 404029 08/16/24 ENGINEERING DESIGN (7/1/24-7/31/24)900.00 900.00 2062675 10/16/24 21359 OPERATIONAL TECHNICAL SERVICES 4470 09/22/24 TEMP STAFFING - FACILITIES MAINTENANCE 4,179.20 4485 09/29/24 TEMP STAFFING - FACILITIES MAINTENANCE 4,179.20 2062597 10/02/24 21359 OPERATIONAL TECHNICAL SERVICES 4457 09/15/24 TEMP STAFFING - FACILITIES MAINTENANCE 4,179.20 4441 09/08/24 TEMP STAFFING - FACILITIES MAINTENANCE 3,343.36 2062702 10/23/24 19636 OT ELECTRICAL 10306 10/17/24 INSTALL NEW 200A PANEL AT 1485-2 RES 17,200.00 17,200.00 2062598 10/02/24 22614 OTAY AFFORDABLE I V8 LP D1077-090497 09/12/24 OTAY RANCH 8W LOT 3 PARCEL F&W 2,180.85 D1077-060266 09/12/24 OTAY RANCH APTS 247.25 2062564 09/25/24 01002 PACIFIC PIPELINE SUPPLY INC S100465933001 08/21/24 GATE VALVES FOR PUMP STATION 1,346.39 1,346.39 2062636 10/09/24 19310 PALM LAUNDRY INC 486 10/01/24 FY25 TOWEL LAUNDRY SERVICE 286.52 286.52 2062637 10/09/24 22625 PATRICK PORTER Ref002743806 10/04/24 UB Refund Cst #0000292162 75.07 75.07 2062565 09/25/24 22609 PAVEMENTS COATINGS CO Ref002743679 09/23/24 UB Refund Cst #0000293762 1,734.76 1,734.76 2062638 10/09/24 22609 PAVEMENTS COATINGS CO Ref002743807 10/04/24 UB Refund Cst #0000293762 534.07 534.07 2062703 10/23/24 00137 PETTY CASH CUSTODIAN 101724 10/17/24 PETTY CASH REIMBURSEMENT 1,665.01 1,665.01 2062566 09/25/24 00137 PETTY CASH CUSTODIAN 092024 HR 09/20/24 PETTY CASH REIMBURSEMENT 3,190.00 092024 09/20/24 PETTY CASH REIMBURSEMENT 1,980.00 2062599 10/02/24 15081 PINOMAKI DESIGN 6351 09/02/24 AS-NEEDED GRAPHIC DESIGN SERVICES FY25 255.00 255.00 2062639 10/09/24 22622 QU YINGYAN Ref002743803 10/04/24 UB Refund Cst #0000268512 90.53 90.53 2062600 10/02/24 22615 RANDY LINDQUIST D1187-090641 09/12/24 4IN WET TAP 4,910.87 4,910.87 Page 5 of 8 4,987.50 315.51 1,833.51 98,184.29 85,027.89 124,309.70 83,051.26 1,506.82 2062676 10/16/24 19836 RED WING BUSINESS ADV ACCOUNT 2.0241E+12 10/10/24 FY25 AS-NEEDED SAFETY BOOTS 1,245.87 1,245.87 2062677 10/16/24 11969 RELIANCE SAFETY CONSULTANT INC 4800 09/19/24 FY25 SAFETY CONSULTING & SUPPORT SERV 2,250.00 2,250.00 2062601 10/02/24 11969 RELIANCE SAFETY CONSULTANT INC 4796 09/16/24 FY25 SAFETY CONSULTING & SUPPORT SERV 2,400.00 4797 09/16/24 FY25 SAFETY CONSULTING & SUPPORT SERV 2,400.00 4799 09/19/24 FY25 SAFETY CONSULTING & SUPPORT SERV 187.50 2062602 10/02/24 15647 RF YEAGER ENGINEERING LLC 24112 09/10/24 CORROSION SERVICES (7/1/24-8/30/24)23,485.00 23,485.00 2062640 10/09/24 04542 ROBAK, MARK 090124093024 09/30/24 MILEAGE REIMBURSEMENT 286.09 090124093024 09/30/24 EXPENSE REIMBURSEMENT 29.42 2062553 09/25/24 22605 RUBEN QUINTANA Ref002743674 09/23/24 UB Refund Cst #0000051787 167.43 167.43 2062603 10/02/24 19377 SAGEVIEW ADVISORY GROUP LLC 2024-19556 09/16/24 INVESTMENT ADV FOR DEFERRED COMP 6,760.00 6,760.00 2062641 10/09/24 02586 SAN DIEGO COUNTY ASSESSOR 202400971 10/02/24 FY25 MONTHLY ASSESSOR DATA 125.00 125.00 2062678 10/16/24 00003 SAN DIEGO COUNTY WATER AUTH 2778 09/19/24 SOCAL WATERSMART HEW HET WBIC FY25 721.04 721.04 2062567 09/25/24 00121 SAN DIEGO GAS & ELECTRIC 091824 09/18/24 UTILITY EXPENSES (MONTHLY)1,741.34 091924 09/19/24 UTILITY EXPENSES (MONTHLY)92.17 2062604 10/02/24 00121 SAN DIEGO GAS & ELECTRIC 092724 09/27/24 UTILITY EXPENSES (MONTHLY)50,188.73 092324 09/23/24 UTILITY EXPENSES (MONTHLY)37,571.11 092624 09/26/24 UTILITY EXPENSES (MONTHLY)9,296.67 092524 09/25/24 UTILITY EXPENSES (MONTHLY)1,127.78 2062679 10/16/24 00121 SAN DIEGO GAS & ELECTRIC 100824 10/08/24 UTILITY EXPENSES (MONTHLY)55,481.12 100824A 10/08/24 UTILITY EXPENSES (MONTHLY)29,546.77 2062642 10/09/24 00121 SAN DIEGO GAS & ELECTRIC 093024 09/30/24 UTILITY EXPENSES (MONTHLY)64,257.42 093024A 09/30/24 UTILITY EXPENSES (MONTHLY)37,089.14 093024B 09/30/24 UTILITY EXPENSES (MONTHLY)22,963.14 2062704 10/23/24 00121 SAN DIEGO GAS & ELECTRIC 100724A 10/07/24 UTILITY EXPENSES (MONTHLY)83,009.92 100724 10/07/24 UTILITY EXPENSES (MONTHLY)41.34 2062643 10/09/24 19603 SECURITAS SECURITY SVC USA INC 11858531 07/31/24 SECURITY AT HMA FOR SANDAG GRANT 881.82 11898731 09/30/24 FY25 ON-DEMAND SECURITY RESPONSE 345.00 11858458 08/31/24 FY25 ON-DEMAND SECURITY RESPONSE 280.00 2062705 10/23/24 22641 SH OV8 LLC Ref002748174 10/21/24 UB Refund Cst #0000293120 11.15 11.15 2062568 09/25/24 22201 SHAW HR CONSULTING INC.012148 09/03/24 HR/EMPLOYMENT RELATIONS CONSULTING 645.00 645.00 2062569 09/25/24 21115 SONIA PONCE Ben2743730 09/26/24 BI-WEEKLY PAYROLL DEDUCTION 553.85 553.85 2062644 10/09/24 21115 SONIA PONCE Ben2743855 10/10/24 BI-WEEKLY PAYROLL DEDUCTION 553.85 553.85 2062706 10/23/24 21115 SONIA PONCE Ben2748203 10/24/24 BI-WEEKLY PAYROLL DEDUCTION 553.85 553.85 Page 6 of 8 1,398.41 19,652.03 4,425.30 873.52 921.42 42,935.00 2,385.32 7,896.00 6,204.00 2062706 10/23/24 21115 SONIA PONCE Ben2748203 10/24/24 BI-WEEKLY PAYROLL DEDUCTION 553.85 553.85 2062605 10/02/24 19401 SOUTHWEST MILLWORKS INC 7729 09/20/24 METER SHOP CABINETS & COUNTERTOP 1,121.30 1,121.30 2062707 10/23/24 05755 STATE WATER RESOURCES 51373MP12124 10/17/24 D2 CERTIFICATION RENEWAL 60.00 60.00 2062680 10/16/24 20411 STC TRAFFIC INC 7379 09/19/24 TRAFFIC ENGINEERING SERVICES (AUG 2024)617.50 617.50 2062606 10/02/24 15974 SUN LIFE FINANCIAL 38166090124 09/01/24 LIFE & STD/LTD INSURANCE (CY2024)11,820.47 11,820.47 2062708 10/23/24 02750 SUPERIOR READY MIX LP 450188 09/18/24 SEPT CONCRETE & DECOMPOSED GRANITE 1,002.08 448868 09/10/24 SEPT CONCRETE & DECOMPOSED GRANITE 396.33 2062607 10/02/24 10339 SUPREME OIL COMPANY 440107 09/16/24 UNLEADED & DIESEL FUEL 13,311.41 440187 09/16/24 UNLEADED & DIESEL FUEL 6,340.62 2062681 10/16/24 18376 SVPR COMMUNICATIONS LLC 1738 09/30/24 AS-NEEDED COMMUNICATIONS CONSULT SVC 800.00 800.00 2062682 10/16/24 22498 THE HILLER COMPANIES 555086 09/26/24 FIRE, LIFE, SAFETY SERVICES 662.33 662.33 2062645 10/09/24 22498 THE HILLER COMPANIES 538000 07/31/24 FIRE, LIFE, SAFETY SERVICES 3,960.30 550159 09/11/24 FIRE, LIFE, SAFETY SERVICES 465.00 2062608 10/02/24 17967 TRI COUNTY PUMP COMPANY 18603 09/09/24 INSPECT PUMP #6 AT 927 PS 6,350.00 6,350.00 2062683 10/16/24 03261 TYLER TECHNOLOGIES INC 045-486718 09/25/24 MUNIS ERP UPGRADE IMPLEMENTATION SERV 5,600.00 5,600.00 2062609 10/02/24 03261 TYLER TECHNOLOGIES INC 045-484849 09/11/24 MUNIS ERP UPGRADE IMPLEMENTATION SERV 3,200.00 3,200.00 2062709 10/23/24 03261 TYLER TECHNOLOGIES INC 045-488295 09/30/24 MUNIS ERP UPGRADE IMPLEMENTATION SERV 9,600.00 9,600.00 2062570 09/25/24 15675 UNITED SITE SERVICES INC 4795559 09/17/24 FY25 PORT. TOILET RENTAL 727.05 4794834 09/17/24 FY25 PORT. TOILET RENTAL 146.47 2062710 10/23/24 15675 UNITED SITE SERVICES INC 4862151 10/15/24 FY25 PORT. TOILET RENTAL 766.25 4863899 10/15/24 FY25 PORT. TOILET RENTAL 155.17 2062610 10/02/24 08028 VALLEY CONSTRUCTION MANAGEMENT SD237808 09/08/24 CMIS (AUG 2024)34,095.00 SD545811 09/08/24 CMIS (AUG 2024)8,840.00 2062684 10/16/24 22435 VAUGHANS INDUSTRIAL REPAIR 030306 10/02/24 PUMP #5 REPAIR AT 870-2 PUMP STATION 47,335.88 47,335.88 2062646 10/09/24 20909 VOLT WORKFORCE SOLUTIONS 46758371 09/29/24 WATER INTERNS FY25 1,192.80 1,192.80 2062611 10/02/24 20909 VOLT WORKFORCE SOLUTIONS 46751332 09/22/24 WATER INTERNS FY25 1,192.80 1,192.80 2062711 10/23/24 20909 VOLT WORKFORCE SOLUTIONS 46773375 10/13/24 WATER INTERNS FY25 1,192.81 46765972 10/06/24 WATER INTERNS FY25 1,192.51 2062612 10/02/24 20739 WATERTALENT LLC 4353 09/18/24 TEMP EMP SERVICES - RECLAMATION PLANT 4,512.00 4336 09/11/24 TEMP EMP SERVICES - RECLAMATION PLANT 3,384.00 2062685 10/16/24 20739 WATERTALENT LLC 4368 09/25/24 TEMP EMP SERVICES - RECLAMATION PLANT 4,230.00 4383 10/02/24 TEMP EMP SERVICES - RECLAMATION PLANT 1,974.00 Page 7 of 8 250.00 2062613 10/02/24 01343 WE GOT YA PEST CONTROL INC 78268 09/06/24 FY25 AS-NEEDED BEE REMOVAL SERVICES 125.00 78369 09/14/24 FY25 AS-NEEDED BEE REMOVAL SERVICES 125.00 2062647 10/09/24 21997 WEST YOST & ASSOCIATES INC 2059996 08/31/24 PLAN CHECK (AUG 2024)21,805.86 21,805.86 2062686 10/16/24 08489 WESTERN WATER WORKS SUPPLY CO 1335474-00 09/20/24 INVENTORY 540.91 540.91 2062614 10/02/24 08489 WESTERN WATER WORKS SUPPLY CO 1335373-00 09/17/24 INVENTORY 9,791.89 9,791.89 2062615 10/02/24 19866 WOOD RODGERS INC 184795 08/31/24 ENGINEERING DESIGN SERVICES (AUG 2024)2,290.00 2,290.00 Amount Pd Total:3,025,998.25 Check Grand Total:3,025,998.25163 Checks Page 8 of 8