HomeMy WebLinkAboutFY 2021 Annual Comprehensive Financial ReportOtay Water District
Annual Comprehensive Financial Report
for the Fiscal Years Ended June 30, 2021 and 2020
BOARD OF DIRECTORS
Tim Smith, Division 1 President
Mark Robak, Division 5 Vice President
Jose Lopez, Division 4 Treasurer
Ryan Keyes, Division 2
Gary Croucher, Division 3
DISTRICT FINANCIAL MANAGEMENT
Jose Martinez General Manager
Joseph R. Beachem Chief Financial Officer
Kevin Koeppen Assistant Chief, Finance
PREPARED BY
Finance Department
Otay Water District, Spring Valley, California
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Table of Contents
Introductory Section
Letter of Transmittal……………………………………………………………………………………………………………………………………. iii
Organization Chart…………………………………………………………………………………………...………………………………………… xiv
List of Principal Officials…………………………………………………………………………………………………...……………………….. xv
GFOA Certificate of Achievement……………………………………………………………………………………………...……………. xvi
Financial Section
Independent Auditors’ Report………………………………………………………………………………………………………...………..… 1
Management’s Discussion & Analysis…………………………………………………...…………………………………...………….. 3
Basic Financial Statements:
Statements of Net Position..…………………………………………………………………………………………………………...….….. 15
Statements of Revenues, Expenses, and Changes in Net Position………….…………………………...…… 17
Statements of Cash Flows……………………………………………………………….…………………………………………………...….. 18
Notes to Financial Statements………………………………………………………………………………………………………………... 20
Required Supplementary Information:
Schedule of Changes in the Net OPEB Liability and Related Ratios for Measurement
Periods Ended June 30, ……………………………………………………………………………………………………………………….. 69
Schedule of Contributions for Fiscal Year Ended June 30, ……………………………………………………………. 70
Schedule of Changes in the Net Pension Liability and Related Ratios for Fiscal Year Ended
June 30, …………………………………………………………. ………………………………………………………………………………………... 71
Schedule of Plan Contributions for Fiscal Year Ended June 30, ..…………………………………………………. 73
Statistical Section
Net Position by Component…………………………………………………………………………………………………………………….. 76
Changes in Net Position………………………………………………………………..………………………………………………………….. 77
Operating Revenues by Source…………………………………………………………………………………………….……………….. 78
Operating Expenses by Function………………………………………………………..…………………………………………………. 79
Non-Operating Revenues by Source……………………………………………………………………………………………………. 80
Non-Operating Expenses by Function………………………………………………………………………………………………. 81
Assessed Valuation of Taxable Property within the District…………………………………………………………. 82
Water Purchases, Production, and Sales……………………………………………...………………………….…………………. 83
Meter Sales by Type…………………………………………………………………….……………………………………………………………. 84
Number of Customers by Service Type……………………………………………………………………………………………….. 85
Property Tax Levies and Collections…………………………………………………………………………………………………….. 86
Water Fixed Rates ……….………………………………………………………………………………………………………………………….…. 87
Water Variable Rates…….…………………………………………………………………………………………………………………………... 89
Sewer Variable and Fixed Rates…….………………………………………………………………………..…………………………….. 90
Ten Largest Customers…………………………………………………………………………………………………………………………….. 91
Ratios of Outstanding Debt by Type…………………………………………………….……………………………………………….. 92
Pledged Revenue Coverage (Water)……………………………………………………………………………………………………. 93
Pledged Revenue Coverage (Wastewater)…………………………………………………………………………………………. 94
Ratios of General Bonded Debt Outstanding………………………………………………………………….………………..… 95
Computation of Direct and Overlapping Bonded Debt………………………………………………………………… 96
Principal Employers…………………………..……………………………………….......................................................……………….. 98
Demographic and Economic Statistics……………………………………………………………………………………………….. 99
Number of Employees by Function………………………………………………………………………………………………………. 100
Active Meters by Size………………………………………………………………..………………………………………………………………. 101
Operating and Capital Indicators…………………………………………………………………………………………………………... 102
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November 16, 2021
Honorable Board of Directors
Otay Water District
We are pleased to present the Otay Water District's (the "District") Annual Comprehensive Financial
Report for the fiscal year ended June 30, 2021.
This report was prepared by the District's Finance Department following guidelines set forth by the
Government Accounting Standards Board (GASB) and generally accepted accounting principles
(GAAP). Responsibility for the accuracy of the data presented and the completeness and fairness of
the presentation, including all disclosures, rests with the District's management. We believe the data,
as presented, is accurate in all material respects and that it is presented in a manner that provides a
fair representation of the financial position and results of the District's operations. Included are all
disclosures we believe necessary to enhance your understanding of the financial condition of the
District. GAAP requires that management provide a narrative introduction, overview, and analysis to
accompany the basic financial statements in the form of Management's Discussion and Analysis
(MD&A), which should be read in conjunction with this report. The District's MD&A can be found
immediately following the Independent Auditors' Report.
Teaman, Ramirez & Smith, Inc., a firm of licensed certified public accountants, audited the District's
financial statements. The goal of the independent audit was to provide reasonable assurance that the
financial statements of the District for the fiscal year ended June 30, 2021, are free of material
misstatement. The independent audit involved examining, on a test basis, evidence supporting the
amounts and disclosures in the financial statements, assessing the accounting principles used and
significant estimates made by management, and evaluating the overall financial statement
presentation. In the independent auditors' opinion, the following financial statements present fairly, in
all material respects, the respective financial position of the District as of June 30, 2021, and are
presented in conformity with GAAP. The Independent Auditors' Report is presented as the first
component of the financial section of this report.
REPORTING ENTITY
The District is a publicly owned water and sewer agency, authorized on January 27, 1956, as a
California special district by the State Legislature, with an entitlement to import water under the
Municipal Water District Act 1911. Its ordinances, policies, taxes, and service rates are set by five
Directors, elected by voters in their respective divisions, to serve staggered four-year terms on its
Governing Board. The District is a "revenue neutral" public agency that does not operate at a profit.
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The District also performs cost of service studies to ensure that each end-user pays only their fair share
of the District's costs of water acquisitions, construction, operation, maintenance, betterment, renewal,
and replacement of the public water and sewer facilities.
The General Manager reports directly to the Board of Directors and oversees day-to-day operations of
Administrative Services, Finance, Water Operations, and Engineering through the four District Chiefs.
These and other lines of reporting are shown on the organization chart on page xiv. Over the last 65
years, the District has grown from a handful of customers and two employees to become an
organization operating a network of more than 915 miles of pipelines, 44 operational reservoirs, a
recycled water facility, and one of the largest recycled water distribution networks in the State of
California. The service area's character has also changed from predominantly dry-land farming and
cattle ranching to businesses, high-tech industries, and large master-planned communities.
Today the District provides
water service to approximately
51,204 potable and 753
recycled customers within 125
square miles of the
southeastern San Diego
metropolitan area. The District
purchases all potable water
sold to its customers from the
San Diego County Water
Authority (CWA). The CWA
purchases much of this water
from the region's primary water
importer, the Metropolitan
Water District of Southern
California (MWD), and the Imperial Irrigation District. In December 2015, the Claude "Bud" Lewis
Carlsbad Desalination Plant began delivering water to the region. The District also entered into an
agreement with the CWA that brought regional water treatment closer to our customers and helped
reduce dependence on water treatment facilities located outside of San Diego County. In 2010, the
District constructed two 10-million-gallon reservoirs and a 5.1-mile, 36-inch diameter pipeline to
receive locally treated potable water from Helix Water District's R.M. Levy Water Treatment Plant and
convey it to customers.
The District also owns and operates a wastewater collection and recycling system providing public
sewer service to approximately 4,736 customer accounts within portions of the communities of La
Mesa, Rancho San Diego, El Cajon, Jamul, and Spring Valley. Wastewater collected is conveyed to
the District's Ralph W. Chapman Water Reclamation Facility, capable of recycling wastewater at a rate
of 1.3 million gallons per day. The District also can purchase up to 6 million gallons per day of recycled
water from the City of San Diego's South Bay Water Reclamation Plant. The District used the recycled
water from these two sources to irrigate eastern Chula Vista schools, public parks, roadway
landscapes, a golf course, and various other approved uses per California Code of Regulations, Title
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22. The use of recycled water reduces dependency on imported supplies and provides a local supply,
thereby diversifying District resources.
MISSION, CURRENT ECONOMIC CONDITIONS, AND OUTLOOK
The District's mission is to provide high quality and reliable water and wastewater services to the Otay
Water District customers in a professional, effective, and efficient manner.
According to the Economic Report published February 2021 by the Xpera Group, the nationwide
demand for new homes and condominiums will continue unabated. The resale home market will
continue its strong demand throughout 2021, with the inventory of housing supply for sale gradually
expanding in the second half of the year. The non-residential construction market will continue to grow
thanks to significant increases in infrastructure and military spending.
The San Diego County growth slowed down in Fiscal Year 2021. The District's Public Services Division
has seen declines in recent years, approving an average of 10 permits per month and selling 297 water
meters during the Fiscal Year 2021, compared to 306 and 502 water meters in fiscal years 2020 and
2019, respectively. As of July 2021, it is estimated that the District served approximately 226,400
residents. The San Diego Association of Governments (SANDAG), the regional planning agency, has
estimated the District's average long-term growth of 0.30%. The District expects nominal growth in the
customer base of 1.0% for Fiscal Year 2022 and projects an ultimate customer population of 272,350
residents by 2045.
KEY LEGISLATION
In 2021, the legislature introduced 2,776 bills, constitutional amendments, and resolutions.
Approximately 900 bills made it to Governor Gavin Newsom’s desk for action. Many bills failed to move
forward and there are approximately 1,100 two-year or inactive file bills, which may be acted upon in
2022. By October 10, the deadline for the governor to sign or veto bills, 1,038 bills and resolutions were
signed into law or passed, and 66 bills were vetoed.
COVID-19 financial relief has been a priority for the District and its customers throughout the year. As
part of the 2021-2022 state budget, there is approximately $1 billion available for water and wastewater
customer arrearages due to the COVID-19 pandemic. In October, the legislature and the governor
reached an agreement. Senate Bill 129 (Skinner) and Assembly Bill 148 (Committee on Budget),
allocated nearly $1 billion in federal funds and established the California Water and Wastewater
Arrearage Payment Program within the State Water Resources Control Board (SWRCB) to provide
relief to community water and wastewater systems for unpaid bills related to the pandemic. The
funding will fund unpaid residential and commercial customers accrued billings between March 4,
2020 and June 15, 2021. The program will initially prioritize drinking water residential and commercial
arrearages. Funding to community water systems will be disbursed through January 31, 2022. If the
program still has funding available, it will extend to wastewater residential and commercial arrearages
by February 2022. District staff will continue its efforts to work with the San Diego County Water
Authority (CWA) and other water-industry coalitions and associations to shape proposed mechanisms
for allocation of financial relief to local water suppliers and its customers.
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The governor’s April 2020 Executive Order N-42-20 prevented public agencies from discontinuing
water service during the COVID-19 pandemic. On June 11, 2021, as circumstances changed and the
governor planned to reopen the state on June 15, the governor signed Executive Order N-08-21, which
set expirations for various pandemic-related executive orders. This executive order included lifting the
moratorium on the discontinuation of water service effective September 30, 2021. However, on
September 7, 2021, the public resources trailer bill Senate Bill 155 (Skinner) was introduced, extending
the moratorium on the discontinuation of water service through December 31, 2021, regardless of the
funding source a community system may receive. Ultimately, this bill was passed by the legislature
and signed by the governor on September 23, 2021.
Senate Bill 222 (Dodd), known as the Water Rate Assistance Program, would establish the Water Rate
Assistance Fund in the state treasury to help provide water affordability assistance, for both drinking
water and wastewater services, to low-income ratepayers and ratepayers experiencing economic
hardship in California. The bill would require the Department of Community Services and
Development to develop and administer the Water Rate Assistance Program. This bill was placed on
the inactive file and may be acted upon in 2022. Staff will continue to monitor this bill.
The SWRCB and many water agencies, including the District, continue to focus on conservation laws
including Senate Bill 606 and Assembly Bill 1668, which passed in 2018. Building on efforts to make
water conservation a way of life and to better prepare the state for droughts and climate change, the
District and other water agencies throughout the state have worked with the CWA and state officials
to define how the conservation laws – SB 606 and AB 1668 – will be implemented. These laws outline
an overall framework to guide the District and other urban water suppliers in setting water-use targets.
The laws require water agencies to establish a residential indoor gallon per capita per day (GPCD)
goal of 55, effective in 2023, decreasing to 52.5 in 2025, followed by a final decrease to 50 GPCD in
2030. The laws also require the SWRCB to adopt an outdoor water-use standard by June 2022. The
District has worked collectively with other water agencies and water industry associations to discuss
and provide comments to the SWRCB to ensure the regulations are both equitable and reflect local
conditions. The District will continue to work on these efforts as the SWRCB releases more
recommendations and reports.
A related legislative issue that caused concern for water agencies this year was Assembly Bill 1434
(Freidman), which would have established, beginning January 1, 2023 until January 1, 2025, a standard
for indoor residential water use GPCD goal of 48; beginning January 1, 2025, a standard of 44 GPCD;
and, beginning January 1, 2030, a GPCD standard of 40. The bill failed to meet its deadline, so it may
be acted upon in January 2022. Because the current laws (SB 606 and AB 1668) already establish a
residential indoor GPCD goal of 55, effective in 2023, and the standards under the current laws were
heavily negotiated with the final agreement reflecting a compromise made between all engaged
stakeholders, the District and other water agencies believed that AB 1434 was too premature to
determine new regulations without understanding the full implementation and outcome of the
previously approved laws, SB 606 and AB 1668. The District remains concerned that a reduced indoor
standard as proposed, will have significant impacts on potable water usage, wastewater, recycled
and reuse systems, infrastructure, operations, supplies, and affordability.
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Furthermore, related to water-use efficiency and critical to the state and the region is the ongoing
drought conditions. By July 2021, 50 of California’s 58 counties, excluding San Diego County, fell into
a drought state of emergency under the governor’s executive action. Additionally, as drought
conditions worsened, Governor Newsom signed Executive Order N-10-21, which called on
Californians to voluntarily reduce water use by 15% compared to 2020 levels. On October 19, the
governor extended the drought emergency declaration to cover the entire state and asked the SWRCB
to ban wasteful water practices. In addition, the governor directed water suppliers to implement their
Water Shortage Contingency Plans, which are responsive to local supply-demand conditions. While
the San Diego region is not currently facing supply reductions, on October 28, the CWA Board of
Directors voted to activate a Shortage Level 1 under its Water Shortage Contingency Plan (WSCP).
This action signaled that voluntary conservation efforts are necessary, while giving local retail water
agencies flexibility to address local conditions. The District declared a Shortage Level 1 Drought Alert
under its WSCP on October 29 thereby urging customers to voluntarily reduce water use by 10%. The
District further called on customers to voluntarily reduce use by 15% to align with the Governor’s July
2021 executive action.
The District and other water agencies throughout California are actively looking to the SWRCB and its
2020 Final Water Resilience Portfolio to assist in empowering local and regional entities to meet their
unique challenges, while delivering on the state’s responsibility to provide tools and leadership,
advance projects of statewide scale and importance, and help address challenges that are beyond
the scope of any region. District staff, working with CWA and other local agencies, will continue to
evaluate the actions in the portfolio and resolve the most strategic methods to implement them.
As directed by the governor and building on work already conducted, the Department of Water
Resources is in the process of preparing a Draft Environmental Impact Report for a single tunnel
solution to modernize Delta conveyance. The Draft EIR is expected to be released for public review
and comment in mid-2022. This environmental review process is also consistent with the governor’s
executive order directing state agencies to develop the aforementioned portfolio of statewide water
actions and investments that improve water recycling, recharge depleted groundwater reserves,
strengthen existing levee protections, and improve Delta water quality.
Supported by the District and signed on September 22, 2021 by the governor, Senate Bill 323
(Caballero), provides public agency water and sewer rates the same protections already afforded to
fees and charges that fund other essential government services. This bill will authorize a local agency
or interested person to bring a validation action in a superior court to determine the validity of a fee or
charge for water and sewer service. It will also require an interested party bring a validation action
within 120 days after the fee or charge becomes effective. It also provides that this bill shall only apply
to a fee or charge for water or sewer service that has been adopted, modified, or amended after
January 1, 2022.
Another item the District is actively engaged in is the governor’s Executive Order N-79-20, which
recognizes the need for the state to transition to carbon neutrality by setting a course to end sales of
internal combustion passenger vehicles by 2035. The California Air Resources Board (CARB) is now
faced with the task of transitioning high priority private fleets and public fleets to zero emission vehicles
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to meet the state’s goals set forth by the order. The District and other water agencies are seeking an
exemption for emergency response vehicles under the Advanced Clean Fleets Proposed Rulemaking
for public fleets to ensure that the District’s first responders in the field responding to water and
wastewater utility emergencies in specialized vehicles have the resources and infrastructure available
to them to ensure that response is not delayed. District staff has sent formal comments to CARB, met
with CARB staff to discuss its concerns, and is working with regional partners including the CWA and
the Association of California Water Agencies to coordinate advocacy efforts on this front. This will
remain a priority advocacy issue as the rulemaking develops prior to adoption, which is anticipated in
mid-to-late 2022.
To address the “Silver Tsunami” – an aging and retiring workforce in the water and wastewater
operator fields – and to increase the pool of qualified individuals for these positions, the District
continues to focus on the recent law (Assembly Bill 1588) that passed in October 2019. The law
ensures military veterans transitioning into civilian water and wastewater operator occupations
receive appropriate credit for experience and education gained during military service. The District,
other water agencies, and stakeholders continue to work on defining the process with the SWRCB
and educating veterans and other stakeholders about how veterans can obtain sufficient credit for
their experience and education. The District has also secured a position on the State Water Resource
Control Board’s Drinking Water Division’s Advisory Committee to assist it in carrying out its
responsibility pursuant to the law.
STRATEGIC PLAN
Since its establishment, the District’s motto has been “Dedicated to Community Service.” From modest
beginnings in 1956 through today, the District stands committed to providing outstanding service to
the residents and businesses it has the honor to serve. This serves as a great reminder to our staff and
customers as to why the District exists.
During the District’s early years, a key focus of its preceding strategic plans was to meet the demands
of growth. Today, the District’s four-year Strategic Plan (Fiscal Years 2019-2022) still has the word
“growth” in its theme of “Growth and Sustainability,” but “sustainability” is a critical element in
managing long-term maintenance and replacement of infrastructure. Staff works diligently to ensure
its planning documents and programs support the District’s water supply and sewer facilities that
serve its customers now and in the future. The four-year Strategic Plan aims to support the goals in
our planning documents, which include the Water Facilities Master Plan Update, Wastewater
Management Plan, Urban Water Management Plan, and other critical plans.
The District’s Strategic Plan also serves as a roadmap to execute its organizational objectives and
track day-to-day performance metrics, which ensure deliverables are being met and essential work
processes are being continuously fine-tuned. The District’s Strategic Plan was developed using the
Balanced Scorecard performance management framework. Via this framework, management and
staff share a focused business and operational strategy to ensure the District is moving along the right
path and maximizing its limited resources.
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The District’s strategic philosophy recognizes that as the agency evolves and service footprint matures,
fewer development resources and fees will be available, while operational assets and infrastructure
maintenance, rehabilitation, and replacement costs will increase. This is an important phase of the
operational lifecycle and will therefore place pressure to increase customer rates to counter more
costly service expenses. To balance the customer’s interest in minimizing rate increases, while also
maintaining the agency’s infrastructure, investments, and financial position, the management team
continues to place emphasis on efficiencies within the agency, including innovation and continued
use of technology throughout its operations.
In effect, the District leverages its investments in technology to manage operational cost and do more
with the same or fewer resources. With sound planning, prudent fiscal management, community
focus, and a work culture prepared to adapt to new challenges, the District is well positioned to support
its growing customer base, while sustaining the quality of water service our customers expect. From
a water supply perspective, this means determining the optimal water supply, treatment, and delivery
solutions for customers. From a daily operating perspective, efficiency enhancements have become
the principal source of competitive advantage and cost optimization.
Finding ways to utilize technology, streamline operations, and reduce external costs are critical
elements of the District’s ongoing commitment and dedication to its customers. Savings generated
through streamlining and reducing costs are passed to our ratepayers. As a key example, from 2017
to 2021, the District began to upgrade or replace more than 49,600 automated meter reading (AMR)
meters, originally installed between 2004 and 2012. To be as cost efficient as possible, the District is
replacing meter registers instead of the entire meter and, when applicable, taking advantage of
existing warranties. This saves the District and its ratepayers approximately $3.3 million in meter
replacement costs. Because of the meter’s life expectancy and warranty, the District can delay the
replacement of its meters by approximately 10 years. There are many benefits to utilizing AMR meter
technology, including the reduction of meter reading staff, increased safety of staff, and allowing staff
to store historical water use data. These advanced meters can assist customers and the District to
identify unexplained usage by providing leak, tamper, and backflow detection notifications. The efforts
related to AMR meters are an example of the District’s ongoing commitment to pursue efficient and
cost saving technologies.
The success of this approach is proven by the District’s gains in productivity, reduction in staffing, and
associated costs. The District has reduced staffing by 34.75 full-time equivalent positions, or 20%, while
the number of customer accounts increased by 4,177 from 2007 through 2022. Because of increased
efficiency and higher employee productivity, the District has continued absorbing some of the pass-
through costs from its water suppliers, including the City of San Diego, CWA, and Metropolitan Water
District (MWD). This helps to address customer concerns about rising water rates.
To reduce the District’s costs of retirement obligations, the District made an advanced payment of
$31.8 million to its CalPERS pension plan on August 15, 2018. This strategic action significantly reduced
the high financing cost of the unfunded liability at CalPERS and brought the funding level up to 87%,
which will save the District approximately $16 million. In Fiscal Year 2020, the District’s Other Post
Employee Benefits (OPEB) plan became fully funded. In Fiscal Year 2021, with the OPEB plan being
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fully funded, the District began redirecting $1.1 million of additional contributions to PERS. The District
has budgeted to continue the additional $1.1 million contribution in Fiscal Year 2022. When combined
with the $31.8 million 2018 advance funding, the District’s PERS funding strategy is projected to save
the District in excess of $20 million over the next 12 years.
Other cost savings include the reduction in number of vehicles and equipment, fuel consumption,
pavement costs, and decreasing water loss through the successful leak detection and repair program.
Staff continues to seek out other operational efficiencies, thus decreasing costs and minimizing rate
impacts on District customers.
Based on an annual survey of water and sewer rates conducted by staff, the District continues to be
one of the lower cost providers in San Diego County.
BUDGETING CONTROLS
The District views the budget as an essential tool for proper financial management and is adopted
before each fiscal year. The budget is developed by combining the District's strategic objectives and
measures with input from the organization's various departments. The budget becomes a direct
reflection of the District's strategic plan by incorporating these strategic measures and objectives. The
budget is designed and presented for the general needs of the District, its staff, and its customers. It is
a comprehensive and balanced financial plan that features District services, resources and allocation,
financial policies, strategic objectives, and other useful information that allows the users to understand
the District's financial status and future. The District monitors performance monthly by generating
comparative reports of budget to actual and distributing them to all department heads, with top-level
information provided to the Board at the monthly board meetings.
BUDGET SUMMARY
The District's operating expenditures consist of three major sectors: potable water, recycled water, and
wastewater. The total operating budget is $112,157,500 for Fiscal Year 2022. Revenues from potable
and recycled water sales are projected to be $99,615,000, about $12,455,000 (14.3%) higher than the
Fiscal Year 2021 budget. Water sales volumes are expected to increase by 15.0% versus Fiscal Year
2021. The MWD and CWA water supply rate increased by 4.9% due to the high cost of supply
programs, higher energy costs, and increasing operating costs. District staff projects sewer revenues
to be $3,068,000, approximately $198,000 more than the Fiscal Year 2021. The remaining budgeted
revenues of $9.5 million come from various special fees, assessments, and non-operating revenues.
A water rate increase of 4.2% has been budgeted for January 1, 2022, while a 4.9% rate increase for
wastewater has been budgeted, effective January 1, 2022.
The 2021-22 Capital Improvement Program (CIP) budget consists of 123 projects and an $8.7 million
budget. This year's six-year CIP budget increased by $9.1 million from $92.3 million to $101.4 million.
The CIP budget emphasizes long-term planning for ongoing programs to meet population growth,
facilities replacement, and betterment of infrastructure while functioning within fiscal constraints.
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THE FUTURE
The District continues its commitment to diversify water resources, reducing dependence on
traditional water supplies from the Colorado River and the Sacramento-San Joaquin Bay-Delta. The
coming years will continue to pose challenges for those in California's water community. Due to below
average rains in Fiscal Year 2021, potable sales volumes increased 10.7% from Fiscal Year 2020 levels.
The District projects a 15.0% increase in water sales volume in Fiscal Year 2022 compared to the
previous year’s budget and a decrease of 6.7% versus FY 2021 actual sales volume.
SAN DIEGO COUNTY WATER SUPPLY
San Diego County imports about 80% of its water from the Colorado River and Northern California.
Since these sources face legal and environmental constraints, the region has been exploring other
ways to ensure an adequate water supply, including increased water recycling, incorporating water-
use efficiency and conservation programs as a way of life, increased water storage, and groundwater,
and seawater desalination.
CAPITAL IMPROVEMENT PROGRAM (CIP)
To ensure a reliable water supply and sewer system for the future, including sustaining the current
infrastructure, the District has developed several future planning documents, which provide a guide
to defining the District's proposed projects.
The major projects planned for delivery over the next six fiscal years include:
• Various Waterline Replacements (24 Total)
• Reservoir Improvements (15 Total)
• Pump Station Upgrades & Modifications (P2083, P2174, P2196, P2619, P2639, P2666,
S2060, and S2069)
• Automated Meter Reading (P2604 and R2143) and Advanced Metering Infrastructure
(P2682) Meter and Vault Replacements
• Sewer Basin Improvements (S2049, S2050, S2054 and S2066)
ACCOUNTING SYSTEM
The Finance Department is responsible for providing financial services to the District, including
financial accounting, debt management, reporting, payroll, accounts payable; investment of funds,
billing and collection of water and wastewater charges; taxes; and other revenues. The District's books
and records are maintained on an enterprise basis, matching revenues against the costs of providing
services. Revenues and expenses are recorded on an accrual basis when revenues are earned, and
expenses are incurred.
INTERNAL CONTROLS
The District operates within a system of internal controls established and periodically reviewed by
management. This provides reasonable assurance that assets are adequately safeguarded, and
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transactions are recorded correctly according to District policies and procedures. When establishing
or reviewing controls, management must also consider the cost of the control and its value derived
from its utilization. Management maintains and implements all sensitive controls and those controls
whose value adequately exceeds their cost.
Management believes the District's internal controls, procedures, and policies adequately safeguard
assets and provide reasonable assurance of proper recording of financial transactions. In addition, the
District maintains controls to provide for compliance with all finance-related legal and contractual
provisions. Management believes the activities reported within the presented Annual Comprehensive
Financial Report comply with these finances related legal and contractual provisions, including bond
covenants and fiduciary responsibilities.
AWARDS AND ACKNOWLEDGMENTS
The Government Finance Officers Association of the United States and Canada (GFOA) awarded a
Certificate of Achievement for Excellence in Financial Reporting to Otay Water District for its
Comprehensive Annual Financial Report for the fiscal year ended June 30, 2020. To earn a Certificate
of Achievement, a government agency must publish an easily readable and efficiently organized
Comprehensive Annual Financial Report. This report must satisfy both generally accepted accounting
principles and applicable legal requirements.
A Certificate of Achievement is valid for one year only. Staff believes that the District's current Annual
Comprehensive Financial Report continues to meet the Certificate of Achievement Program's
requirements and is submitting it to the GFOA to determine its eligibility for another certificate.
In addition to the Certificate of Achievement for Excellence in Financial Reporting, the District has
received the following awards:
The Government Finance Officers Association of the United States and Canada presented a
Distinguished Budget Presentation Award to Otay Water District for its annual budget for the
Fiscal Year 2020-2021. To achieve this award, a governmental unit must publish a budget
document that meets program criteria as a policy document, an operations guide, a financial
plan, and a communications device.
The California Society of Municipal Finance Officers presented the District with the Certificate
of Award for Excellence in Operating Budgeting for Fiscal Year 2020-2021.
The California Society of Municipal Finance Officers presented the District with the Certificate
of Award for Excellence in Capital Budgeting for Fiscal Year 2020-2021.
We want to thank all the staff involved for their efforts to prepare this Annual Comprehensive Financial
Report and their hard work to ensure a successful outcome. We would also like to thank the firm of
Teaman, Ramirez & Smith, Inc., for their professional work and opinion.
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To the Board of Directors, we acknowledge and appreciate the Board's continued support and
direction in achieving excellence in financial management.
Joseph R. Beachem
Chief Financial Officer
Jose Martinez
General Manager
xiii
Josephhhhhhh R Beachem
Jose Martinez
Organization Chart
District Position Count – (139 Positions)
Citizens and
Customers Board of Directors
General Manager (5)
Safety and
Security
Administration
Purchasing
and Facilities
Controller and
Budgetary
Services
Treasury and
Accounting
Services
Customer
Service
Meter
Services
Water System
Operations
Utility
Maintenance/
Construction
Water Resources,
Planning, Design
and
Environmental
Administrative
Services
(23)
Human
Resources
Information
Technology
and
Geographic
Information
System
Finance
(31)
Strategic
Planning
Public Services
and
Field Services
Engineering
(26)
Water
Operations
(54)
Collection,
Treatment, and
Reclamation
Operations
District Secretary
General Counsel
Public Information
Conservation
xiv
List of Principal Officials
Board of Directors
The Otay Water District is a revenue-
neutral public agency established in
accordance with the California Water
Code. This not-for-profit status means
Otay has no private shareholders, pays no
dividends and therefore does not report
to, nor answer to the California Public
Utilities Commission. The District does,
however, answer to the public through a
five-member Board of Directors. Each
Director is elected by voters within their
respective division boundaries to
represent the public's interest with regard
to rates for service, taxes, policies,
ordinances, and other matters related to
the management and operation of the
Otay Water District. Directors serve four-
year alternating terms on the Board.
Mission Statement
To provide exceptional water and
wastewater service to its customers, and
to manage District resources in a
transparent and fiscally responsible
manner.
Tim Smith
President
Division 1
Mark Robak
Vice President
Division 5
Jose Lopez
Treasurer
Division 4
Ryan Keyes
Division 2
Gary Croucher
Division 3
xv
GFOA CERTIFICATE OF ACHIEVEMENT
FOR EXCELLENCE IN FINANCIAL REPORTING
The Government Finance Officers Association (GFOA) awarded a Certificate of
Achievement for Excellence in Financial Reporting to the Otay Water District for its
Comprehensive Annual Financial Report for the fiscal year ended June 30, 2020. This
is the seventeenth year that the District has achieved this prestigious award. In order
to be awarded a Certificate of Achievement, the District had to publish an easily
readable and comprehensive report. This report must satisfy both Generally
Accepted Accounting Principles (GAAP) and applicable legal requirements.
This award is valid for a period of one year only. We believe our current Annual
Comprehensive Financial Report continues to meet the Certificate of Achievement
Program’s requirements, and will be submitting it to GFOA to determine its eligibility
for another certificate.
xvi
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2
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, 2021. 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) Statements of Net Position, 2) Statements of Revenues,
Expenses, and Changes in Net Position, 3) Statements of Cash Flows, and 4) Notes to the Financial
Statements. This report also contains other supplementary information in addition to the basic financial
statements.
The Statements of Net Position present 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 positions may serve as a valuable indicator of whether the District's financial
position is improving or weakening.
The Statements of Revenues, Expenses, and Changes in Net Position present information showing how the
District's net position changed during the most recent fiscal year. All changes in net positions 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 Statements of Cash Flows present information on cash receipts and payments for the fiscal year. The
Notes to the Financial Statements provides additional information essential to a complete understanding of
the data supplied in the specific financial statements listed above.
Financial Highlights
x 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 $405.3 million (net position). Of this amount, $60.7 million (unrestricted net
position) may be used to meet the District’s ongoing obligations to residents and creditors.
x Total assets increased by $11.9 million or 2.16% during Fiscal Year 2021, to $562.8 million, due to increases in cash and
cash equivalents and receivables which were partially offset by a decrease in capital assets from depreciation exceeding
current year additions.
3
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 $405.3 million at the close of Fiscal Year 2021.
The largest portion of the District's net position, $340.4 million (84%), reflects its investment in capital assets,
plus unused debt proceeds, 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.
4
Management’s Discussion and Analysis
Statements of Net Position
(In Millions of Dollars)
2021 2020 2019
Assets
Current and Other Assets $ 111.2 $ 94.4 $ 89.7
Capital Assets 451.6 456.5 458.3
Total Assets 562.8 550.9 548.0
Deferred Outflows of Resources
Deferred Actuarial Pension Costs 5.4 3.4 39.0
Deferred Actuarial OPEB Costs 2.5 1.1 2.2
Total Deferred Outflows of Resources 7.9 4.5 41.2
Liabilities
Long-Term Debt Outstanding 106.2 112.0 114.3
Net Pension Liability 20.0 16.6 48.4
Net OPEB Liability 1.8 0.0 3.4
Other Liabilities 36.0 35.7 33.8
Total Liabilities 164.0 164.3 199.9
Deferred Inflows of Resources
Deferred Actuarial Pension Costs 0.0 1.3 1.2
Deferred Actuarial OPEB Costs 1.4 2.3 0.5
Total Deferred Inflows of Resources 1.4 3.6 1.7
Net Position
Net Investment in Capital Assets 340.4 345.2 354.6
Restricted for Debt Service 4.2 4.3 4.3
Unrestricted 60.7 38.0 28.7
Total Net Position $ 405.3 $ 387.5 $ 387.6
The District's operations and population are growing. Much of this expansion has occurred in the residential
sector, particularly in multi-family dwellings and commercial areas. By 2045, the District's service area
population is expected to increase by 21% to 272,350 residents. 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.
5
Management’s Discussion and Analysis
In FY 2021, the District's Capital Assets increased by $10.7 million before accumulated depreciation. (See
Note 4 in the Notes to Financial Statements). The District also saw a decrease in long-term debt of $5.8
million (excluding current maturities) due to annual debt service payments (See Note 5 in the Notes to
Financial Statements).
Deferred outflows of resources increased by $3.4 million in FY 2021 due to additional funding of $1.2 million
to CalPERS, an increase of $1.0 million on the net difference between projected and actual earnings for the
pension, a $1.0 million increase in the OPEB differences between expected and actual experience, and a
$0.2 million increase in FY 2021 PERS Unfunded Actuarial Liability (UAL). The $36.7 million decrease of
deferred outflows in FY 2020 was due to the $31.8 million additional funding to CalPERS and the $2.4 million
decrease in FY 2020 PERS Unfunded Actuarial Liability (UAL).
At the end of FY 2021, the District can report positive balances in all net position categories. This situation
also applies to the prior two fiscal years.
Statements of Revenues, Expenses, and Changes in Net Position
(In Millions of Dollars)
2021 2020 2019
Water Sales $ 101.7 $ 90.4 $ 86.8
Wastewater Revenue 2.9 2.9 3.0
Connection and Other Fees 2.5 2.6 2.2
Non-operating Revenues 12.9 10.9 11.5
Total Revenues 120.0 106.8 103.5
Depreciation Expense 17.2 16.8 16.8
Other Operating Expenses 91.5 90.2 86.9
Non-operating Expenses 5.3 6.9 9.2
Total Expenses 114.0 113.9 112.9
Income (Loss) Before Capital
Contributions 6.0 (7.1) (9.4)
Capital Contributions 11.8 7.0 9.5
Change in Net Position 17.8 (0.1) 0.1
Beginning Net Position 387.5 387.6 387.5
Ending Net Position $ 405.3 $ 387.5 $ 387.6
6
Management’s Discussion and Analysis
Water Sales increased by $11.3 million and $3.6 million in FY 2021 and FY 2020, respectively, due to an
increase in units sold, as a result of below-average rainfall, and higher water rates.
Other Operating Expenses increased by $1.3 million and $3.3 million in FY 2021 and FY 2020, respectively,
predominantly due to the increases in water units purchased as a result of increases in water sales volumes.
The increase in FY 2021, is partially offset by the credit received from the City of San Diego as a result of a
reduction in the contractual recycled water volumes due to the City’s plant being shut down.
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 2021 and FY 2020, those expenses were $0.2 million and
$0.4 million, respectively.
Connection and Other Fees decreased by $0.1 million in FY 2021 and increased by $0.4 million in FY 2020.
Capital Contributions increased by $4.8 million in FY 2021 due to high demand in the housing market and
decreased by $2.5 million in FY 2020 due to the slowdown in housing development.
Non-operating Revenues
Non-operating Revenues by Major Source
(In Millions of Dollars)
2021 2020 2019
Taxes and Assessments $ 5.3 $ 4.9 $ 4.7
Rents and Leases 1.6 1.5 1.4
Other Non-operating Revenue 6.0 4.5 5.5
Total Non-operating Revenues $ 12.9 $ 10.9 $ 11.6
The District's total non-operating revenues increased by $2.0 million in FY 2021 due primarily to the $3.2
million settlement from Metropolitan Water District (MWD) partially offset by a decrease in investment
earnings. Total non-operating revenues decreased by $0.7 million in FY 2020 due primarily to decreases in
investment earnings and transfer of capacity revenue from capital contribution to fund project expenditures
that do not qualify as capital assets.
7
Management’s Discussion and Analysis
Capital Assets and Debt Administration
The District's capital assets (net of accumulated depreciation) as of June 30, 2021, totaled $451.6 million.
Included in this amount is land, which is a non-depreciable asset. The District's net capital assets decreased
by 1.07% and 0.39% in FY 2021 and FY 2020, respectively.
Capital Assets
(In Millions of Dollars)
As indicated by the figures in the table above, most capital assets added during both fiscal years were related
to the water and wastewater systems. Additionally, the majority of the cost of construction-in-progress is
also associated with water systems. Additional information on the District's capital assets can be found in
Note 4 of the Notes to Financial Statements.
In November 2018, the District issued $32.4 million in Water Revenue Bonds, Series 2018 to provide funds
for the construction of water storage, treatment, transmission facilities, and advance refunded $6.9 million of
the 1996 Certificates of Participation. As of June 30, 2021, approximately $0.3 million of the 2018 Water
Revenue Bond proceeds remain in Restricted Cash and Cash Equivalents.
2021 2020 2019
Land $ 14.4 $ 14.4 $ 14.4
Construction in Progress 25.8 24.7 33.2
Potable Water System 506.7 498.1 488.8
Recycled Water System 116.6 115.5 114.8
Wastewater System 59.1 59.1 48.5
Field Equipment 8.1 8.4 8.6
Buildings 19.6 19.5 19.2
Transportation Equipment 3.8 3.6 3.5
Communication Equipment 2.8 2.7 3.4
Office Equipment 16.3 16.5 16.8
Total Capital Assets 773.2 762.5 751.2
Less Accumulated
Depreciation (321.6) (306.0) (292.9)
Net Capital Assets $ 451.6 $ 456.5 $ 458.3
8
Management’s Discussion and Analysis
In December 2019, the District issued $3.1 million in Wastewater Revenue Bonds to fund specific capital
improvements made to the District's wastewater system. As of June 30, 2020, all the bond proceeds were
used to pay for the construction cost of the wastewater main replacement at Campo Road.
On June 30, 2021, the District had $106.2 million in outstanding debt (net of $5.3 million of maturities
occurring in FY 2022), which consisted of the following:
General Obligation Bonds $ 0.7
Revenue Bonds 105.5
Total Long-Term Debt $ 106.2
Additional information on the District's long-term debt can be found in Note 5 of the Notes to Financial
Statements.
Fiscal Year 2021-2022 Budget
Economic Factors
The San Diego region imports 80% of its potable supply, therefore, factors such as local rainfall and weather
conditions elsewhere in the western portion of the nation can affect the region. San Diego received below-
average rainfall of 4.93 inches in FY 2021. The 10-year average of 9.00 inches for San Diego rainfall reflects
the long-term drought conditions for our area. San Diego's rainfall average over 20 years is 9.01 inches; the
30-year average is 9.65 inches, and the 40-year average is 9.92 inches.
While water sales peaked around 2008, conservation has permanently impacted volumes. Prolonged
droughts have resulted in additional conservation, further impacting volumes. Below-average rainfall has
led to potable water sales volume increasing by 10.7% in FY 2021, while above-average rainfall has led to
potable water sales volume increasing by only 0.6% in FY 2020. The FY 2021 budget was prepared assuming
that the pandemic would adversely impact potable and recycled water sales volumes by 12% and 15%,
respectively. In FY 2021, the actual water volumes did not experience the pandemic-driven declines
anticipated in the budget. Therefore, the FY 2022 budget was prepared assuming the water volumes would
be consistent with actual historical volumes and excluding the adverse impacts included in the FY 2021
budget. The FY 2022 sales volume is anticipated to increase 15.0% compared to the previous year's budget
and decrease 6.7% versus FY 2021 actual sales volume.
The District continues to respond to the challenges presented by growth, State mandates, and the potential
of drought by creating new opportunities and new organizational efficiencies. Utilizing and refining its
Strategic Business Plan has captured the Board of Director's vision and united its staff in a joint mission. The
District has achieved several significant accomplishments due to its successful adherence to its Strategic
9
Management’s Discussion and Analysis
Business Plan. The District is poised to continue successfully providing an affordable, safe, and reliable
water supply for the people of its service area, and set to reap the rewards of greater efficiencies and
economies of scale.
The District is currently at about 69% of its projected ultimate population, serving approximately 226,000
people. Long-term, this percentage should continue to increase as the District's service area develops and
grows. By 2045, the District is projected to serve approximately 272,350 people, with an average daily
demand of 46 million gallons per day (MGD) compared to the current average daily demand of 26.5 million
gallons per day (MGD). Currently, the District services the needs of this growing population by purchasing
water from the San Diego County Water Authority (CWA), who in turn purchases its water from the
Metropolitan Water District (MWD) and the Imperial Irrigation District (IID).
Otay takes delivery of the water through several connections of large diameter pipelines owned and
operated by CWA. The District currently receives treated water from CWA directly and from the Helix Water
District via a CWA contract. Also, 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.
Financial
The District is budgeted to deliver approximately 27,002 acre-feet of potable water to 51,316 potable
customer accounts during FY 2021-2022. Management feels that these projections are realistic after
accounting for low growth, supply changes, conservation, and the economic impacts of COVID-19. A
combination of factors, including weather patterns and the economic uncertainty brought about by the
COVID-19 pandemic, have created challenges in developing projections for the current fiscal year.
Unemployment is expected to fall by the end of the year. The housing market is expected to be high. An
increase in consumer goods demand is expected due to the Federal government's assistance programs.
District staff projects that the District will sell another 1,694 meters over the next six years, translating to 2,905
equivalent dwelling units (EDUs). This growth is estimated to increase sales volumes by an average of less
than 1% per year over the next five years. While all these factors impact the region's water usage, people's
water needs to remain an underlying constant.
Management is unaware of any other conditions that are likely to significantly impact the District's current
financial position, net position, or operating results.
10
Management’s Discussion and Analysis
Contacting the District's Financial Management
This financial report is designed to provide a general overview of the Otay Water District's finances for the
Board of Directors, customers, creditors, and other interested parties. Questions concerning any of the
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.
11
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12
13
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14
2021 2020
ASSETS
Current Assets:
Cash and Cash Equivalents (Notes 1 and 2)84,818,274$ 65,089,488$
Board Designated Cash and Cash Equivalents (Notes 1 and 2)3,092,512 2,598,569
Restricted Cash and Cash Equivalents (Notes 1 and 2)816,218 6,077,597
Restricted Investments (Notes 1 and 2)3,666,097 3,740,520
Accounts Receivable, Net 14,840,937 13,420,104
Accrued Interest Receivable 144,169 260,735
Taxes and Availability Charges Receivable, Net 252,183 178,777
Restricted Taxes and Availability Charges Receivable, Net 21,170 75,263
Inventories 855,563 942,564
Prepaid Items and Other Receivables 2,710,237 2,003,970
Total Current Assets 111,217,360 94,387,587
Non-current Assets:
Net OPEB Asset (Note 8)- 20,021
Capital Assets (Note 4):
Land 14,423,773 14,423,773
Construction in Progress 25,786,352 24,711,844
Capital Assets, Net of Depreciation 411,352,279 417,367,132
Total Capital Assets, Net of Depreciation 451,562,404 456,502,749
Total Non-current Assets 451,562,404 456,522,770
Total Assets 562,779,764 550,910,357
DEFERRED OUTFLOWS OF RESOURCES
Deferred Actuarial Pension Costs (Note 7)5,421,523 3,358,365
Deferred Actuarial OPEB Costs (Note 8)2,439,632 1,139,535
Total Deferred Outflows of Resources 7,861,155$ 4,497,900$
Continued
STATEMENTS OF NET POSITION
June 30, 2021 and 2020
The accompanying notes are an integral part of this statement.
15
2021 2020
LIABILITIES
Current Liabilities:
Current Maturities of Long-term Debt (Note 5)5,250,000$ 4,955,000$
Accounts Payable 14,735,726 16,224,117
Accrued Payroll Liabilities 910,173 811,521
Other Accrued Liabilities 4,985,693 4,644,505
Customer and Developer Deposits 4,480,951 3,673,975
Accrued Interest 1,722,189 1,790,955
Unearned Revenues - 57,024
Liabilities Payable from Restricted Assets:
Restricted Accrued Interest 19,000 28,067
Total Current Liabilities 32,103,732 32,185,164
Non-current Liabilities:
Long-term Debt (Note 5):
General Obligation Bonds 739,080 1,460,435
Revenue Bonds 105,484,807 110,487,562
Net Pension Liability 20,043,519 16,616,855
Net OPEB Liability 1,801,159 -
Other Non-current Liabilities 3,793,011 3,550,571
Total Non-current Liabilities 131,861,576 132,115,423
Total Liabilities 163,965,308 164,300,587
DEFERRED INFLOWS OF RESOURCES
Deferred Actuarial Pension Costs (Note 7)- 1,366,658
Deferred Actuarial OPEB Costs (Note 8)1,424,536 2,274,249
Total Deferred Inflows of Resources 1,424,536 3,640,907
NET POSITION
Net Investment in Capital Assets 340,383,389 345,156,470
Restricted for Debt Service 4,187,443 4,261,399
Unrestricted 60,680,243 38,048,894
Total Net Position 405,251,075$ 387,466,763$
STATEMENTS OF NET POSITION - Continued
June 30, 2021 and 2020
The accompanying notes are an integral part of this statement.
16
Statements of Revenues, Expenses, and Changes in Net Position
2021 2020
OPERATING REVENUES
Water Sales 101,742,970$ 90,435,148$
Wastewater Revenue 2,899,180 2,921,310
Connection and Other Fees 2,498,318 2,582,351
Total Operating Revenues 107,140,468 95,938,809
OPERATING EXPENSES
Cost of Water Sales 66,889,570 62,573,257
Wastewater 2,633,413 2,439,117
Administrative and General 21,948,435 25,196,555
Depreciation 17,212,905 16,778,967
Total Operating Expenses 108,684,323 106,987,896
Operating Income (Loss)(1,543,855)(11,049,087)
NON-OPERATING REVENUES (EXPENSES)
Investment Earnings 254,668 1,784,834
Taxes and Assessments 5,251,540 4,939,950
Availability Charges 686,697 694,768
Gain (Loss) on Disposal of Capital Assets (159,734)(1,243,742)
Rents and Leases 1,587,687 1,501,328
Miscellaneous Revenues 5,062,779 1,936,162
Donations (84,389)(121,600)
Interest Expense (4,782,490)(4,953,987)
Miscellaneous Expenses (241,379)(558,405)
Total Non-operating Revenues (Expenses)7,575,379 3,979,308
Income (Loss) Before Capital Contributions 6,031,524 (7,069,779)
Capital Contributions 11,752,788 6,941,932
Change in Net Position 17,784,312 (127,847)
Total Net Position, Beginning 387,466,763 387,594,610
Total Net Position, Ending 405,251,075$ 387,466,763$
For the Years Ended June 30, 2021 and 2020
The accompanying notes are an integral part of this statement.
17
2021 2020
CASH FLOWS FROM OPERATING ACTIVITIES
Receipts from Customers 104,028,293$ 91,797,189$
Receipts from Connections and Other Fees 2,498,318 2,582,351
Receipts from Property Rents and Leases 1,587,687 1,501,328
Other Receipts 5,005,755 1,857,963
Payments to Suppliers (70,598,225)(64,513,739)
Payments to Employees (22,630,352)(21,233,287)
Other Payments (325,768)(680,005)
Net Cash Provided By (Used For) Operating Activities 19,565,708 11,311,800
CASH FLOWS FROM NONCAPITAL AND RELATED
FINANCING ACTIVITIES
Receipts from Taxes and Assessments 5,170,067 4,890,815
Net Cash Provided By (Used For) Noncapital and Related
Financing Activities 5,170,067 4,890,815
CASH FLOWS FROM CAPITAL AND RELATED
FINANCING ACTIVITIES
Proceeds from Capital Contributions 8,560,257 5,223,069
Proceeds from Sale of Capital Assets 24,748 139,965
Proceeds from Debt Related Taxes and Assessments 748,857 715,136
Proceeds from Long-Term Debt - 3,106,320
Principal Payments on Long-Term Debt (4,955,000)(4,725,000)
Interest Payments and Fees (5,334,433)(5,472,280)
Acquisition and Construction of Capital Assets (9,264,511)(14,637,213)
Net Cash Provided By (Used For) Capital and Related
Financing Activities (10,220,082)(15,650,003)
CASH FLOWS FROM INVESTING ACTIVITIES
Interest Received on Investments 371,234 1,865,617
Proceeds from Sale and Maturities of Investments 170,315 25,918,767
Purchase of Investments (95,892)(7,709,647)
Net Cash Provided By (Used For) Investing Activities 445,657 20,074,737
Net Increase (Decrease) in Cash and Cash Equivalents 14,961,350 20,627,349
Cash and Cash Equivalents - Beginning 73,765,654 53,138,305
Cash and Cash Equivalents - Ending 88,727,004$ 73,765,654$
Continued
Statements of Cash Flows
For the Years Ended June 30, 2021 and 2020
The accompanying notes are an integral part of this statement.
18
2021 2020
Reconciliation of Operating Income (Loss) to Net Cash Flows
Provided By (Used For) Operating Activities:
Operating Income (Loss)(1,543,855)$ (11,049,087)$
Adjustments to Reconcile Operating Income to
Net Cash Provided By (Used For) Operating Activities:
Depreciation 17,212,905 16,778,967
Receipts from Property Rents and Leases 1,587,687 1,501,328
Miscellaneous Revenues 5,005,755 1,857,963
Miscellaneous Expenses and Donations (325,768) (680,005)
(Increase) Decrease in Accounts Receivable (1,420,833) (1,632,150)
(Increase) Decrease in Inventory 87,001 (167,018)
(Increase) Decrease in Prepaid Items and Other Receivables (706,267) (510,139)
(Increase) Decrease in Net OPEB Asset 20,021 (20,021)
(Increase) Decrease in Deferred Actuarial Pension Costs (2,063,158) 35,664,453
(Increase) Decrease in Deferred Actuarial OPEB Costs (1,300,097) 1,070,039
Increase (Decrease) in Accounts Payable (1,488,391) 2,162,293
Increase (Decrease) in Accrued Payroll and Related Expenses 98,652 172,274
Increase (Decrease) in Other Accrued Liabilities 341,188 (874,754)
Increase (Decrease) in Customer and Developer Deposits 806,976 72,881
Increase (Decrease) in Other Non-current Liabilities 242,440 212,897
Increase (Decrease) in Net OPEB Liability 1,801,159 (3,415,025)
Increase (Decrease) in Net Pension Liability 3,426,664 (31,772,051)
Increase (Decrease) in Deferred Actuarial Pension Costs (1,366,658) 209,483
Increase (Decrease) in Deferred Actuarial OPEB Costs (849,713) 1,729,472
Net Cash Provided By (Used For) Operating Activities 19,565,708$ 11,311,800$
Schedule of Cash and Cash Equivalents:
Current Assets:
Cash and Cash Equivalents 84,818,274$ 65,089,488$
Board Designated Cash and Cash Equivalents 3,092,512 2,598,569
Restricted Cash and Cash Equivalents 816,218 6,077,597
Total Cash and Cash Equivalents 88,727,004$ 73,765,654$
Supplemental Disclosures
Non-Cash Investing and Financing Activities Consisted of the Following:
Contributed Capital for Water and Sewer System 3,192,531$ 1,718,863$
Change in Fair Value of Investments and Recognized Gains/Losses 360,636 (432,728)
Amortization Related to Long-term Debt 474,110 474,340
For the Years Ended June 30, 2021 and 2020
Statements of Cash Flows - Continued
The accompanying notes are an integral part of this statement.
19
Notes to Financial Statements
Years Ended June 30, 2021 and 2020
NOTE DESCRIPTION PAGE
1 Reporting Entity and Summary of Significant Accounting Policies..…………… 21 - 29
2 Cash and Investments……………………………………………………………………………..…………….. 30 - 35
3 Fair Value Measurements…………………………………………..………........................................ 35 - 37
4 Capital Assets…………………………………………………..………………………………………………………. 37 - 38
5 Long-Term Debt………………………………………………….…………………………………………………… 39 - 45
6 Net Position……………………………………………………………………………………………………………….. 45
7 Defined Benefit Pension Plan……………………………………………………………………………….. 45 - 53
8 Other Post Employment Benefits………………………..…………............................................ 53 - 60
9 Commitments and Contingencies……………………………………………………………………… 60 - 61
10 Risk Management……………………………………………………………………………………………………. 61 - 62
11 Segment Information………………………………………………..……………………………………………. 62 - 65
20
Notes to Financial Statements
Years Ended June 30, 2021 and 2020
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, Otay
Service Corporation (the “Corporation”) and the Otay Water District Financing Authority (the
“Financing Authority”).
The Otay Water District (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 Otay Service Corporation on June 21, 1993, a nonprofit public benefit
corporation duly organized and existing under the laws of the State of California. The Service
Corporation was formed to assist the District in the financing of public capital improvements. On
March 3, 2021, the Otay Service Corporation was dissolved by the District.
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 units. 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 Service Corporation and Financing Authority as
“blended” component units. Despite being legally separate, the Service Corporation and Financing
Authority are so intertwined with the District that they are in substance, part of the District’s
operations. Accordingly, the balances and transactions of these component units are reported within
the funds of the District. Separate financial statements are not issued for the Service Corporation and
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 Statements of Net Position. The Statements of Revenues, Expenses
21
Notes to Financial Statements
Years Ended June 30, 2021 and 2020
1) REPORTING ENTITY AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Continued
B) Measurement Focus, Basis of Accounting and Financial Statement Presentation - Continued
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.
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-
22
Notes to Financial Statements
Years Ended June 30, 2021 and 2020
1) REPORTING ENTITY AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Continued
B) Measurement Focus, Basis of Accounting and Financial Statement Presentation - Continued
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 $30,373 at June 30, 2021 and
$28,227 at June 30, 2020.
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 Statements 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.
C) New Accounting Pronouncements
Implemented as of June 30, 2021
Governmental Accounting Standard Board Statement No. 84
In January of 2017, GASB issued Statement No. 84, Fiduciary Activities. This Statement was issued
to improve guidance regarding the identification of fiduciary activities for accounting and financial
reporting purposes. This Statement establishes the criteria for identifying fiduciary activities which
should be reported in a fiduciary fund in the basic financial statements. The fiduciary funds that
should be reported, if applicable: a) pensions trust funds, b) investment trust funds, c) private purpose
trust funds, d) custodial funds. Statement No. 84 is effective for reporting periods beginning after
December 15, 2018. Due to the COVID-19 pandemic, GASB No. 95 delayed the implementation of
this GASB Statement by one year for reporting periods beginning after December 15, 2019. Currently,
this Statement has no effect on the District’s financial statements.
Governmental Accounting Standard Board Statement No. 90
In August of 2018, GASB issued Statement No. 90, Majority Equity Interests, an amendment of GASB
Statements No. 14 and No. 61. This Statement was issued to improve the consistency and
comparability of reporting a government's majority equity interest in a legally separate organization
23
Notes to Financial Statements
Years Ended June 30, 2021 and 2020
1) REPORTING ENTITY AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Continued
C) New Accounting Pronouncements - Continued
Implemented as of June 30, 2021 - Continued
and to improve the relevance of financial statement information for certain component units. This
Statement defines a majority equity interest and specifies that a majority equity interest in a legally
separate organization should be reported as an investment if a government's holding of the equity
interest meets the definition of an investment. A majority equity interest that meets the definition of
an investment should be measured using the equity method, unless it is held by a special-purpose
government engaged only in fiduciary activities, a fiduciary fund, or an endowment (including
permanent and term endowments) or permanent fund. Those governments and funds should
measure the majority equity interest at fair value. Statement No. 90 is effective for fiscal years
beginning after December 15, 2018. Due to the COVID-19 pandemic, GASB No. 95 delayed the
implementation of this Statement by one year for reporting periods beginning after December 15,
2019. Currently, this Statement has no effect on the District’s financial statements.
Governmental Accounting Standard Board Statement No. 98
In October of 2021, GASB issued Statement No. 98, The Annual Comprehensive Financial Report.
This Statement establishes the term annual comprehensive financial report and its acronym ACFR.
That new term and acronym replace instances of comprehensive annual financial report and its
acronym in generally accepted accounting principles for state and local governments. Statement
No. 98 is effective for fiscal years ending after December 15, 2021. The District has elected to early
implement GASB No. 98 and is reflected on the District’s financial statements.
Implemented as of June 30, 2020
Governmental Accounting Standard Board Statement No. 95
In May of 2020, GASB issued Statement No. 95, Postponement of the Effective Dates of Certain
Authoritative Guidance. The objective of this statement is to provide temporary relief to governments
and other stakeholders in light of the COVID-19 pandemic by postponing the effective dates of certain
provisions in Statements and Implementation Guides which are as follows:
a. GASB Statement 83 - Reporting periods beginning after June 15, 2019.
b. GASB Statement 84 and Implementation Guide 2019-2 - Reporting periods beginning after
December 15, 2019.
c. GASB Statement 87 and Implementation Guide 2019-3 - Fiscal years beginning after June
15, 2021, and all reporting periods thereafter.
d. GASB Statement 88 - Reporting periods beginning after June 15, 2019.
e. GASB Statement 89 - Reporting periods beginning after December 15, 2020.
f. GASB Statement 90 - Reporting periods beginning after December 15, 2019.
24
Notes to Financial Statements
Years Ended June 30, 2021 and 2020
1) REPORTING ENTITY AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Continued
C) New Accounting Pronouncements - Continued
Implemented as of June 30, 2020 - Continued
Governmental Accounting Standard Board Statement No. 95 - Continued
g. GASB Statement 91 - Reporting periods beginning after December 15, 2021.
h. GASB Statement 92, paragraphs 6 and 7 - Fiscal years beginning after June 15, 2021.
i. GASB Statement 92, paragraphs 8, 9, and 12 - Reporting periods beginning after June 15,
2021.
j. GASB Statement 92, paragraph 10 - Government acquisitions occurring in reporting periods
beginning after June 15, 2021.
k. GASB Statement 93, paragraphs 13 and 14 - Fiscal years beginning after June 15, 2021, and
all reporting periods thereafter.
l. Implementation Guide 2017-3, Questions 4.484 and 4.491 - The first reporting period in
which the measurement date of the (collective) net OPEB liability is on or after June 15,
2019.
m. Implementation Guide 2017-3, Questions 4.85, 4.103, 4.108, 4.109, 4.225, 4.239, 4.244, 4.245,
and 5.1-5.4 - Actuarial valuations as of December 15, 2018, or later.
n. Implementation Guide 2018-1 - Reporting periods beginning after June 15, 2019.
o. Implementation Guide 2019-1- Reporting periods beginning after June 15, 2020.
GASB Statement No. 95 is effective immediately. The District has elected to delay certain provisions
in the GASB Statements as allowed by GASB Statement No. 95. GASB Statements Nos. 83, 88 and
89 were implemented by the District in fiscal year 2019.
Pending Accounting Standards
GASB has issued the following statements which impact the District’s financial reporting
requirements in the future:
i. GASB Statement 87 - “Leases”, effective for fiscal years beginning after June 15, 2021*.
ii. GASB Statement 91 - “Conduit Debt Obligations”, effective for fiscal years beginning after
December 15, 2021*.
iii. GASB Statement 92 - “Omnibus 2020”, effective for reporting periods beginning after June 15,
2021*.
iv. GASB Statement 93 - “Replacement of Interbank Offered Rates”, effective for reporting
periods beginning after June 15, 2021*.
v. GASB Statement 94 - “Public-Private and Public-Public Partnerships and Availability Payment
Arrangements”, effective for reporting periods beginning after June 15, 2022.
25
Notes to Financial Statements
Years Ended June 30, 2021 and 2020
1) REPORTING ENTITY AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Continued
C) New Accounting Pronouncements - Continued
Pending Accounting Standards - Continued
vi. GASB Statement 96 - “Subscription-Based Information Technology Arrangements”, effective
for reporting periods beginning after June 15, 2022.
vii. GASB Statement 97 - “Certain Component Unit Criteria, and Accounting and Financial
Reporting for Internal Revenue Code Section 457 Deferred Compensation Plans”, effective
for reporting periods beginning after June 15, 2021.
*These GASB Statements original effective dates were postponed by GASB Statement No. 95.
D) Deferred Outflows / Inflows of Resources
In addition to assets, the Statements 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 position 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 Statements 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 position 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 pension costs and deferred actuarial OPEB
costs, are deferred and recognized as an inflow of resources in the period that the amounts become
available.
E) Statements of Cash Flows
For purposes of the Statements 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 represented by the external pool. All investments are stated at their fair
value. The District has not elected to report certain investments at amortized costs.
26
Notes to Financial Statements
Years Ended June 30, 2021 and 2020
1) REPORTING ENTITY AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Continued
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. 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.
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 50-75 Years
Wastewater System 25-50 Years
I) Other Non-current Liabilities
For compensated absences, the District’s policy to record vested or accumulated vacation and sick
leave as an expense and liability as benefits accrue to employees.
June 30, 2021
Beginning Ending Due Within
Balance Additions Reductions Balance One Year
Compensated Absences $ 3,246,272 $ 1,657,775 $ 1,394,886 $ 3,509,161 $ 350,916
Customer Credits 272,282 5,840 - 278,122 -
Reimbursement Agreements 356,644 - - 356,644 -
Total $ 3,875,198 $ 1,663,615 $ 1,394,886 $ 4,143,927 $ 350,916
Current portion is reflected in accrued payroll liabilities and remainder in other non-current liabilities on the
Statements of Net Position.
27
Notes to Financial Statements
Years Ended June 30, 2021 and 2020
1) REPORTING ENTITY AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Continued
I) Other Non-current Liabilities - Continued
June 30, 2020
Beginning Ending Due Within
Balance Additions Reductions Balance One Year
Compensated
Absences $ 3,011,855 $ 1,644,010 $ 1,409,593 $ 3,246,272 $ 324,627
Customer Credits 270,360 1,922 - 272,282 -
Reimbursement
Agreements 356,644 - - 356,644 -
Total $ 3,638,859 $ 1,645,932 $ 1,409,593 $ 3,875,198 $ 324,627
Current portion is reflected in accrued payroll liabilities and remainder in other non-current
liabilities on the Statements 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 $342,527 for 2021 and $201,152
for 2020.
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.
28
Notes to Financial Statements
Years Ended June 30, 2021 and 2020
1) REPORTING ENTITY AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Continued
M) Pensions
For purposes of measuring the net pension liability and deferred outflows/inflows of resources
related to pensions, and pension expense, information about the fiduciary net position of the District’s
California Public Employees’ Retirement System (CalPERS) plans (Plans) and additions
to/deductions from the Plans’ fiduciary net position have been determined on the same basis as they
are reported by CalPERS. For this purpose, benefit payments (including refunds of employee
contributions) are recognized when due and payable in accordance with the benefit terms.
Investments are reported at fair value.
N) Other Post-Employment Benefits (OPEB)
For purposes of measuring the net OPEB liability, deferred outflows/inflows of resources related to
OPEB, and OPEB expense, information about the fiduciary net position of the District’s plan (OPEB Plan)
and additions to/deductions from the OPEB Plan’s fiduciary net position have been determined on the
same basis. For this purpose, benefit payments are recognized when currently due and payable in
accordance with the benefit terms. Investments are reported at fair value.
Generally accepted accounting principles require that the reported results must pertain to liability and
asset information within certain defined timeframes. For this report, the following timeframes are used:
2021 2020
Valuation Date June 30, 2020 June 30, 2019
Measurement Date June 30, 2020 June 30, 2019
Measurement Period July 1, 2019 to June 30, 2020 July 1, 2018 to June 30, 2019
O) 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.
P) Reclassifications
Certain reclassifications have been made to prior year amounts to conform to the current year
presentation.
29
Notes to Financial Statements
Years Ended June 30, 2021 and 2020
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 under the parameters of such policies.
Cash and Investments are classified in the accompanying financial statements as follows:
2021 2020
Statements of Net Position:
Cash and Cash Equivalents $ 84,818,274 $ 65,089,488
Board Designated Cash and Cash Equivalents 3,092,512 2,598,569
Restricted Cash and Cash Equivalents 816,218 6,077,597
Restricted Investments 3,666,097 3,740,520
Total Cash and Investments $ 92,393,101 $ 77,506,174
Cash and Investments consist of the following:
2021 2020
Cash on Hand $ 2,950 $ 2,950
Deposits with Financial Institutions 2,614,972 2,775,114
Investments 89,775,179 74,728,110
Total Cash and Investments $ 92,393,101 $ 77,506,174
Investments Authorized by the California Government Code and the District’s Investment Policy
The following table 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 trustee 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.
30
Notes to Financial Statements
Years Ended June 30, 2021 and 2020
2) CASH AND INVESTMENTS - Continued
Investments Authorized by the California Government Code and the District’s Investment Policy -
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, 2021 and 2020.
31
Notes to Financial Statements
Years Ended June 30, 2021 and 2020
2) CASH AND INVESTMENTS - Continued
Disclosures Relating to Interest Rate Risk - Continued
June 30, 2021 Remaining Maturity (in Months)
12 Months 13 to 24 25 to 60 More Than
Investment Type Or Less Months Months 60 Months
U.S. Government Sponsored Entities $ 3,666,097 $ 3,666,097 $ - $ - $ -
Local Agency Investment Fund (LAIF) 29,610,369 29,610,369 -- -
San Diego County Pool 56,420,000 56,420,000 -- -
Money Market Funds 78,713 78,713 -- -
Total $ 89,775,179 $ 89,775,179 $ - $ - $ -
June 30, 2020 Remaining Maturity (in Months)
12 Months 13 to 24 25 to 60 More Than
Investment Type Or Less Months Months 60 Months
U.S. Government Sponsored Entities $ 3,740,520 $ - $ 3,740,520 $ - $ -
Local Agency Investment Fund (LAIF) 65,748,989 65,748,989 - - -
San Diego County Pool 5,155,000 5,155,000 - - -
Money Market Funds 83,601 83,601 - - -
Total $ 74,728,110 $ 70,987,590 $ 3,740,520 $ -$-
Disclosures Relating to Credit Risk
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, 2021 and 2020.
June 30, 2021 Minimum Rating as of Year End
Legal Not
Investment Type Rating AAA AA A-1 Rated
U.S. Government Sponsored Entities $ 3,666,097 N/A $ 3,666,097 $ -$ - $ -
Local Agency Investment Fund (LAIF) 29,610,369 N/A - - - 29,610,369
San Diego County Pool 56,420,000 N/A - - - 56,420,000
Money Market Funds 78,713 N/A -- 78,713 -
Total $ 89,775,179 $ 3,666,097 $ -$ 78,713 $86,030,369
32
Notes to Financial Statements
Years Ended June 30, 2021 and 2020
2) CASH AND INVESTMENTS - Continued
Disclosures Relating to Credit Risk - Continued
June 30, 2020 Minimum Rating as of Year End
Legal Not
Investment Type Rating AAA AA A-1 Rated
U.S. Government Sponsored Entities $ 3,740,520 N/A $ 3,740,520 $ - $ - $ -
Local Agency Investment Fund (LAIF) 65,748,989 N/A - - - 65,748,989
San Diego County Pool 5,155,000 N/A - - - 5,155,000
Money Market Funds 83,601 N/A - - 83,601 -
Total $ 74,728,110 $ 3,740,520 $ - $ 83,601 $70,903,989
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 years 2021 and 2020 and
within the limitations of the District’s investment policy. 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, 2021 and 2020:
June 30, 2021
Issuer Investment Type Reported Amount
Federal Home Loan Bank U.S. Government Sponsored Entities $ 3,666,097
June 30, 2020
Issuer Investment Type Reported Amount
Federal Home Loan Bank U.S. Government Sponsored Entities $ 3,740,520
Custodial Credit Risk
Custodial credit risk for deposits is the risk that, in the event of the failure of a depository financial institution,
a government 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, a government 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
33
Notes to Financial Statements
Years Ended June 30, 2021 and 2020
2) CASH AND INVESTMENTS - Continued
Custodial Credit Risk - Continued
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 public agencies. 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, 2021, $2,375,382 and as of June 30, 2020, $2,937,575 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.
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, 2021 was 0.33%. The estimated amortized cost and fair value of the LAIF pool at
June 30, 2021 was $193,304,977,285 and $193,321,015,759. The District’s share of the pool at June 30, 2021
was approximately 0.01532%. The annualized yield of LAIF for the quarter ended June 30, 2020 was 1.47%.
The estimated amortized cost and fair value of the LAIF pool at June 30, 2020 was $101,110,343,833 and
$101,607,078,218. The District’s share of the pool at June 30, 2020 was approximately 0.05895%.
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
anytime 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
34
Notes to Financial Statements
Years Ended June 30, 2021 and 2020
2) CASH AND INVESTMENTS - Continued
San Diego County Pooled Fund - Continued
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.
Restricted Cash and Cash Equivalents
2021 2020
Debt Service:
General Obligation Bond ID No. 27-2009 $ 442,633 $ 437,278
Water Revenue Bond Series 2010A 23,102 24,452
Water Revenue Bond Series 2010B 55,611 59,149
Water Revenue Bond Series 2018 294,872 5,556,718
Total $ 816,218 $ 6,077,597
Board Designated Cash and Investments
Cash and investments are Board restricted for the cost of the following District projects:
2021 2020
Cash and Cash Equivalents:
New Water Supply $ 3,092,512 $ 2,598,569
Total $ 3,092,512 $ 2,598,569
Restricted Investments
2021 2020
Debt Service:
Water Revenue Bond Series 2010A $ 1,009,432 $ 1,029,924
Water Revenue Bond Series 2010B 2,656,665 2,710,596
Total $ 3,666,097 $ 3,740,520
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:
35
Notes to Financial Statements
Years Ended June 30, 2021 and 2020
3) FAIR VALUE MEASUREMENTS - Continued
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.
Fair value of assets measured on a recurring basis at June 30, 2021 and 2020, are as follows:
June 30, 2021
Significant Other
Observable Inputs
Fair Value (Level 2) Uncategorized
U.S. Government Sponsored Entities $ 3,666,097 $ 3,666,097 $-
Local Agency Investment Fund (LAIF) 29,610,369 -29,610,369
San Diego County Pool 56,420,000 -56,420,000
Money Market Funds 78,713 78,713 -
Total $ 89,775,179 $ 3,744,810 $ 86,030,369
June 30, 2020
Significant Other
Observable Inputs
Fair Value (Level 2) Uncategorized
U.S. Government Sponsored Entities $ 3,740,520 $ 3,740,520 $-
Local Agency Investment Fund (LAIF) 65,748,989 -65,748,989
San Diego County Pool 5,155,000 -5,155,000
Money Market Funds 83,601 83,601 -
Total $ 74,728,110 $ 3,824,121 $ 70,903,989
36
Notes to Financial Statements
Years Ended June 30, 2021 and 2020
3) FAIR VALUE MEASUREMENTS - Continued
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. Uncategorized investments do not fall under the fair value hierarchy as there is no active market
for the investments.
4) CAPITAL ASSETS
The following is a summary of changes in Capital Assets for the year ended June 30, 2021:
Beginning Ending
Balance Additions Deletions Balance
Capital Assets, Not Depreciated:
Land $ 14,423,773 $ - $ - $ 14,423,773
Construction in Progress 24,711,844 9,264,511 (8,190,003) 25,786,352
Total Capital Assets,
Not Depreciated 39,135,617 9,264,511 (8,190,003) 40,210,125
Capital Assets, Being Depreciated:
Infrastructure 672,699,638 10,550,082 (795,764) 682,453,956
Field Equipment 8,398,722 35,777 (327,095) 8,107,404
Buildings 19,462,893 259,707 (140,800) 19,581,800
Transportation Equipment 3,616,452 280,694 (147,045) 3,750,101
Communication Equipment 2,703,459 73,706 - 2,777,165
Office Equipment 16,444,241 182,568 (312,871) 16,313,938
Total Capital Assets,
Being Depreciated 723,325,405 11,382,534 (1,723,575) 732,984,364
Less Accumulated Depreciation:
Infrastructure 270,267,410 15,458,219 (719,310) 285,006,319
Field Equipment 6,398,078 328,855 (327,095) 6,399,838
Buildings 9,440,450 549,332 (34,026) 9,955,756
Transportation Equipment 2,419,841 277,566 (147,045) 2,550,362
Communication Equipment 2,326,786 158,932 - 2,485,718
Office Equipment 15,105,708 440,001 (311,617) 15,234,092
Total Accumulated
Depreciation 305,958,273 17,212,905 (1,539,093) 321,632,085
Total Capital Assets,
Being Depreciated, Net
417,367,132
(5,830,371)
(184,482)
411,352,279
Total Capital Assets, Net $ 456,502,749 $ 3,434,140 $ (8,374,485) $ 451,562,404
Depreciation expense for the year ended June 30, 2021 was $17,212,905.
37
Notes to Financial Statements
Years Ended June 30, 2021 and 2020
4) CAPITAL ASSETS - Continued
The following is a summary of changes in Capital Assets for the year ended June 30, 2020:
Beginning Ending
Balance Additions Deletions Balance
Capital Assets, Not Depreciated:
Land $ 14,403,823 $ 19,950 $ - $ 14,423,773
Construction in Progress 33,149,164 14,637,214 (23,074,534) 24,711,844
Total Capital Assets,
Not Depreciated 47,552,987 14,657,164 (23,074,534) 39,135,617
Capital Assets, Being Depreciated:
Infrastructure 652,066,029 23,561,440 (2,927,831) 672,699,638
Field Equipment 8,572,710 208,646 (382,634) 8,398,722
Buildings 19,242,739 220,154 - 19,462,893
Transportation Equipment 3,525,948 504,210 (413,706) 3,616,452
Communication Equipment 3,417,918 64,066 (778,525) 2,703,459
Office Equipment 16,781,571 219,347 (556,677) 16,444,241
Total Capital Assets,
Being Depreciated 703,606,915 24,777,863 (5,059,373) 723,325,405
Less Accumulated Depreciation:
Infrastructure 256,979,110 14,846,658 (1,558,358) 270,267,410
Field Equipment 6,385,742 394,970 (382,634) 6,398,078
Buildings 8,915,004 525,446 - 9,440,450
Transportation Equipment 2,588,003 242,050 (410,212) 2,419,841
Communication Equipment 2,915,093 190,218 (778,525) 2,326,786
Office Equipment 15,067,603 579,625 (541,520) 15,105,708
Total Accumulated
Depreciation 292,850,555 16,778,967 (3,671,249) 305,958,273
Total Capital Assets,
Being Depreciated, Net
410,756,360
7,998,896
(1,388,124)
417,367,132
Total Capital Assets, Net $ 458,309,347 $ 22,656,060 $ (24,462,658) $ 456,502,749
Depreciation expense for the year ended June 30, 2020 was $16,778,967.
38
Notes to Financial Statements
Years Ended June 30, 2021 and 2020
5) LONG-TERM DEBT
Long-term liabilities for the year ended June 30, 2021 are as follows:
Beginning Ending Due Within
Balance Additions Deletions Balance One Year
General Obligation Bonds:
Improvement District No. 27 – 2009 $ 2,105,000 $ - $ 680,000 $ 1,425,000 $ 705,000
Unamortized Bond Premium 35,435 - 16,355 19,080 -
Net General Obligation Bonds 2,140,435 - 696,355 1,444,080 705,000
Revenue Bonds:
2010 Water Revenue Bonds Series A 5,890,000 - 1,065,000 4,825,000 1,120,000
2010 Water Revenue Bonds Series B 36,355,000 - - 36,355,000 -
2013 Water Revenue Refunding Bonds 3,160,000 - 745,000 2,415,000 775,000
2016 Water Revenue Refunding Bonds 29,025,000 - 1,155,000 27,870,000 1,215,000
2018 Water Revenue Bonds 31,190,000 - 1,310,000 29,880,000 1,370,000
2019 Wastewater Revenue Bonds 3,120,000 - - 3,120,000 65,000
2010 Series A Unamortized Premium 316,207 - 74,402 241,805 -
2013 Bonds Unamortized Premium 304,301 - 96,095 208,206 -
2016 Bonds Unamortized Premium 2,886,904 - 178,571 2,708,333 -
2018 Bonds Unamortized Premium 2,528,599 - 109,148 2,419,451 -
2019 Bonds Unamortized Discount (13,449) - (461) (12,988) -
Net Revenue Bonds 114,762,562 - 4,732,755 110,029,807 4,545,000
Total Long-Term Liabilities $ 116,902,997 $ - $ 5,429,110 $111,473,887 $ 5,250,000
39
Notes to Financial Statements
Years Ended June 30, 2021 and 2020
5) LONG-TERM DEBT - Continued
Long-term liabilities for the year ended June 30, 2020 are as follows:
Beginning Ending Due Within
Balance Additions Deletions Balance One Year
General Obligation Bonds:
Improvement District No. 27 – 2009 $ 2,755,000 $ - $ 650,000 $ 2,105,000 $ 680,000
Unamortized Bond Premium 51,789 - 16,354 35,435 -
Net General Obligation Bonds 2,806,789 - 666,354 2,140,435 680,000
Revenue Bonds:
2010 Water Revenue Bonds Series A 6,905,000 - 1,015,000 5,890,000 1,065,000
2010 Water Revenue Bonds Series B 36,355,000 - - 36,355,000 -
2013 Water Revenue Refunding Bonds 3,875,000 - 715,000 3,160,000 745,000
2016 Water Revenue Refunding Bonds 30,125,000 - 1,100,000 29,025,000 1,155,000
2018 Water Revenue Bonds 32,435,000 - 1,245,000 31,190,000 1,310,000
2019 Wastewater Revenue Bonds - 3,120,000 - 3,120,000 -
2010 Series A Unamortized Premium 390,609 - 74,402 316,207 -
2013 Bonds Unamortized Premium 400,396 - 96,095 304,301 -
2016 Bonds Unamortized Premium 3,065,476 - 178,572 2,886,904 -
2018 Bonds Unamortized Premium 2,637,747 - 109,148 2,528,599 -
2019 Bonds Unamortized Discount - (13,680) (231) (13,449) -
Net Revenue Bonds 116,189,228 3,106,320 4,532,986 114,762,562 4,275,000
Total Long-Term Liabilities $ 118,996,017 $ 3,106,320 $ 5,199,340 $116,902,997 $ 4,955,000
General Obligation Bonds
In June 1998, the District issued $11,835,000 of General Obligation Refunding Bonds. The proceeds of this
issue, together with other lawfully available monies, were to be used to establish an irrevocable escrow to
advance refund and defease in their entirety the District’s previous outstanding General Obligation Bond
issue. In November 2009, the District issued $7,780,000 of General Obligation Refunding Bonds
Improvement District No. 27-2009 to refund the 1998 issue. The proceeds from the bond issue were
$7,989,884, which included an original issue premium of $209,884. An amount of $7,824,647, which
consisted of unpaid principal and accrued interest, was deposited into an escrow fund. Pursuant to an
optional redemption clause in the 1998 bonds, the District was able to redeem the 1998 bonds, without
premium at any time after September 1, 2009. On December 15, 2009 the 1998 bonds were refunded.
40
Notes to Financial Statements
Years Ended June 30, 2021 and 2020
5) LONG-TERM DEBT - Continued
General Obligation Bonds - Continued
These bonds are general obligations of Improvement District No. 27 (ID 27) of the District. The Board of
Directors has the power and is obligated to levy annual ad valorem taxes without limitation, as to rate or
amount for payment of the bonds and the interest upon all property which is within ID 27 and subject to
taxation. The General Obligation Bonds are payable from District-wide tax revenues. The Board may utilize
other sources for servicing the bond debt and interest.
The Improvement District No. 27-2009 General Obligation Refunding Bonds have interest rates from 3.00%
to 4.00% with maturities through Fiscal Year 2023.
Future debt service requirements for the bonds are as follows:
For the Year Ended
June 30, Principal Interest
2022 $ 705,000 $ 42,900
2023 720,000 14,400
$ 1,425,000 $ 57,300
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, 2025;
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, 2026 through September 1, 2040; bearing interest at 6.377% to 6.577%.
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 proceeds of the bonds will be used to fund the project noted above as well as to fund reserve funds
of $1,030,688 (Series 2010A) and $2,707,418 (Series 2010B). $542,666 was used to fund various costs of
issuance.
41
Notes to Financial Statements
Years Ended June 30, 2021 and 2020
5) LONG-TERM DEBT - Continued
Water Revenue Bonds - Continued
The original issue premium is being amortized over the 14-year life of the Series 2010A bonds. Amortization
for the year ending June 30, 2021 was $74,402 and for June 30, 2020 was $74,402. The amortizations are
included in interest expense. The unamortized premium at June 30, 2021 is $241,805 and at June 30, 2020
is $316,207.
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 years ended June 30, 2021 and 2020.
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
described above.
The original issue premium is being amortized over the 11 year life of the Series 2013 bonds. Amortization
for the year ending June 30, 2021 was $96,095 and for June 30, 2020 was $96,095. The amortizations are
included in interest expense. The unamortized premium at June 30, 2021 is $208,206 and at June 30, 2020
is $304,301.
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, 2021 was $178,572 and for June 30, 2020 was $178,572. The amortizations are
included in interest expense. The unamortized premium at June 30, 2021 is $2,708,333 and at June 30,
2020 is $2,886,904.
In November 2018, Water Revenue Bonds were issued 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;
42
Notes to Financial Statements
Years Ended June 30, 2021 and 2020
5) LONG-TERM DEBT - Continued
Water Revenue Bonds - Continued
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, 2021 was $109,148 and for June 30, 2020 was $109,148. The amortization
expense is included in interest expense. The unamortized premium at June 30, 2021 is $2,419,451 and at
June 30, 2020 is $2,528,599.
The total amount outstanding at June 30, 2021 and aggregate maturities of the revenue bonds for the fiscal
years subsequent to June 30, 2021, are as follows:
For the Year
2010 Water Revenue Bond
Series A
2010 Water Revenue Bond
Series B
2013 Water Revenue
Refunding Bonds
Ended June 30, Principal Interest Principal Interest Principal Interest
2022 $ 1,120,000 $ 216,488 $ - $ 2,371,868 $ 775,000 $ 81,100
2023 1,175,000 159,113 - 2,371,868 805,000 49,500
2024 1,235,000 98,862 - 2,371,868 835,000 16,700
2025 1,295,000 33,994 - 2,371,868 - -
2026 - - 1,365,000 2,328,345 - -
2027-2031 - - 8,235,000 10,175,654 - -
2032-2036 - - 11,265,000 7,040,514 - -
2037-2041 - - 15,490,000 2,676,839 - -
$ 4,825,000 $ 508,457 $ 36,355,000 $ 31,708,824 $ 2,415,000 $ 147,300
For the Year
2016 Water Revenue
Refunding Bonds
2018 Water Revenue
Refunding Bonds
Ended June 30, Principal Interest Principal Interest
2022 $ 1,215,000 $ 1,004,206 $ 1,370,000 $ 1,294,038
2023 1,285,000 941,706 1,455,000 1,223,413
2024 1,350,000 875,831 1,650,000 1,145,787
2025 1,420,000 806,581 1,730,000 1,061,288
2026 1,495,000 733,706 1,820,000 972,537
2027-2031 8,570,000 2,582,407 6,355,000 3,774,062
2032-2036 10,300,000 1,041,841 6,750,000 2,392,838
2037-2041 2,235,000 33,525 6,190,000 1,106,456
2042-2044 - - 2,560,000 146,200
$ 27,870,000 $ 8,019,803 $ 29,880,000 $ 13,116,619
43
Notes to Financial Statements
Years Ended June 30, 2021 and 2020
5) LONG-TERM DEBT - Continued
Wastewater Revenue Bonds
In December 2019, Wastewater Revenue Bonds were issued 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 50 year life of the Series 2019 bonds. Amortization
for the year ending June 30, 2021 was $461 and June 30, 2020 was $231. The amortization expense is
included in interest expense. The unamortized discount at June 20,2021 is $12,988 and at June 30, 2020 is
$13,449.
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 years ended June 30, 2021 and 2020.
Future debt service requirements for the bonds are as follows:
For the Year
2019 Wastewater
Revenue Bonds
Ended June 30, Principal Interest
2022 $ 65,000 $ 90,091
2023 70,000 88,741
2024 75,000 87,291
2025 75,000 85,416
2026 80,000 83,091
2027-2031 430,000 377,957
2032-2036 495,000 313,279
2037-2041 565,000 238,888
2042-2046 655,000 147,422
2047-2050 610,000 38,906
$ 3,120,000 $ 1,551,082
Revenues Pledged
The District has pledged a portion of future water sales revenues to repay its Water Revenue and Water
Revenue Refunding Bonds. Total principal and interest remaining on the water revenue bonds and water
44
Notes to Financial Statements
Years Ended June 30, 2021 and 2020
5) LONG-TERM DEBT - Continued
Revenues Pledged - Continued
revenue refunding bonds is $154,846,003 payable through fiscal year 2044. For June 30, 2021, principal
and interest paid by the water sales revenues were $4,275,000 and $5,178,974, respectively. For June 30,
2020, principal and interest paid by the water sales revenues were $4,075,000 and $5,380,424, respectively.
The District has pledged a portion of future wastewater sales revenues to repay its Wastewater Revenue
Bonds. Total principal and interest remaining on the wastewater revenue bonds is $4,671,082 payable
through fiscal year 2050. For June 30, 2021, principal and interest paid by the wastewater sales revenues
were $0 and $90,741, respectively. For June 30, 2020, principal and interest paid by the wastewater sales
revenues were $0 and $90,713, respectively.
6) NET POSITION
Designations of Net Position
In addition to the restricted net position, a portion of unrestricted net position, have been designated by the
Board of Directors for the following purposes as of June 30, 2021 and 2020:
2021 2020
Designated Betterment $ 2,507,060 $ 4,208,271
Replacement Reserve 34,145,548 25,545,931
Designated Expansion 1,293,846 2,262,219
Designated New Supply Fund 5,922 240,764
Employee Benefits Reserve 463,890 386,907
Total $ 38,416,266 $ 32,644,092
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.
45
Notes to Financial Statements
Years Ended June 30, 2021 and 2020
7) DEFINED BENEFIT PENSION PLAN - Continued
A)General Information about the Pension Plans - Continued
Benefits Provided
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 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 1957 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.
The Plans’ provisions and benefits in effect at June 30, 2021 and 2020 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
2021 8.00% 7.00%
2020 8.00% 6.25%
Required Employer Contribution Rates
2021 20.113% 20.113%
2020 40.689% 40.689%
Employees Covered
The following employees were covered by the benefit terms for the Plan:
2021 2020
Inactive Employees or Beneficiaries Currently Receiving Benefits 202 175
Inactive Employees Entitled to But Not Yet Receiving Benefits 128 140
Active Employees 134 134
Total 464 449
46
Notes to Financial Statements
Years Ended June 30, 2021 and 2020
7) DEFINED BENEFIT PENSION PLAN - Continued
A) General Information about the Pension Plans - Continued
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. Funding contributions for the Plan
are determined annually on an actuarial basis as of June 30 by CalPERS. 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. The District is required
to contribute the difference between the actuarially determined rate and the contribution rate of
employees.
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,
2020 and 2019, using the annual actuarial valuations as of June 30, 2019 and 2018, respectively, rolled
forward to June 30, 2020 and 2019, respectively, using standard update procedures. A summary of
principal assumptions and methods used to determine the net pension liability is shown below:
Actuarial Assumptions
The total pension liabilities in the June 30, 2021 and 2020 actuarial valuations were determined using
the following actuarial assumptions:
2021 2020
Valuation Date June 30, 2019 June 30, 2018
Measurement Date June 30, 2020 June 30, 2019
Actuarial Cost Method Entry-Age Normal Cost Method Entry-Age Normal Cost Method
Actuarial Assumptions:
Discount Rate 7.15% 7.15%
Inflation 2.5% 2.5%
Salaries Increases Varies(1) Varies(1)
Mortality Rate Table CalPERS Membership Data(2) CalPERS Membership Data(2)
Post Retirement Benefit Increase See Footnote(3) See Footnote(3)
(1) Depending on age, service and type of employment.
(2) The mortality table used was developed based on CalPERS-specific data. The probabilities of mortality are based on the
2017 CalPERS Experience Study for the period from 1997 to 2015. Pe-retirement and Post-retirement mortality rates include
15 years of projected mortality improvement using 90% of Scale MP-2016 published by the Society of Actuaries. For more
details on this table, please refer to the CalPERS Experience Study and Review of Actuarial Assumptions report form
December 2017 that can be found on the CalPERS website.
(3) The lesser of contract COLA or 2.5% until Purchasing Power Protection Allowance floor on purchasing power applies, 2.5%
thereafter.
47
Notes to Financial Statements
Years Ended June 30, 2021 and 2020
7) DEFINED BENEFIT PENSION PLAN - Continued
B) Net Pension Liability - Continued
Discount Rate
The discount rate used to measure the total pension liability at June 30, 2020 and 2019 measurement
dates was 7.15% for the Plan. 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 best-estimate ranges of expected 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 as well as the expected pension fund cash flows. Using
historical returns of all the funds’ asset classes, expected compound (geometric) returns were
calculated over the short-term (first 10 years) and the long-term (11+ years) using a building-block
approach. Using the expected nominal returns for both short-term and long-term, the present value
of benefits was calculated for each fund. The expected rate of return was set by calculating the
single equivalent expected return that arrived at the same present value of benefits for cash flows as
the one calculated using both short-term and long-term returns. The expected rate of return was
then set equal to the single equivalent rate calculated above and adjusted to account for assumed
administrative expenses.
48
Notes to Financial Statements
Years Ended June 30, 2021 and 2020
7) DEFINED BENEFIT PENSION PLAN - Continued
B) Net Pension Liability - Continued
Long-term Expected Rate of Return - Continued
The following table reflects the long-term expected real rate of return by asset class.
Asset Class(a)
Assumed
Asset Allocation
Real Return
Years 1 - 10(b)
Real Return
Years 11+(c)
2020 2019 2020 2019 2020 2019
Global Equity 50.0% 50.0% 4.80% 4.80% 5.98% 5.98%
Fixed Income 28.0% 28.0% 1.00% 1.00% 2.62% 2.62%
Inflation
Assets/Sensitive
- - 0.77% 0.77% 1.81% 1.81%
Private Equity 8.0% 8.0% 6.30% 6.30% 7.23% 7.23%
Real Assets 13.0% 13.0% 3.75% 3.75% 4.93% 4.93%
Liquidity 1.0% 1.0% - - -0.92% -0.92%
Total 100% 100%
(a) In the System’s Comprehensive Annual Financial Report, Fixed Income in included in Global Debt
Securities; Liquidity is included in Short-term Investments; Inflation Assets are included in both Global
Equity Securities and Global Debt Securities.
(b) An expected inflation of 2.00% used for this period.
(c) An expected inflation of 2.92% used for this period.
49
Notes to Financial Statements
Years Ended June 30, 2021 and 2020
7) DEFINED BENEFIT PENSION PLAN - Continued
C)Changes in the Net Pension Liability
The changes in the Net Pension Liability for the Plan for June 30, 2021:
Increase (Decrease)
Total Pension
Liability
Plan Fiduciary
Net Position
Net Pension
Liability/(Asset)
Beginning Balance $142,409,387 $ 125,792,532 $ 16,616,855
Changes in the Year:
Service Cost 2,623,208 -2,623,208
Interest on the Total Pension Liability 10,043,778 - 10,043,778
Changes in Benefit Terms - - -
Changes in Assumptions - - -
Differences Between Expected and Actual
Experience 260,337 -260,337
Net Plan to Plan Resource Movement - - -
Contributions - Employer -2,437,119 (2,437,119)
Contributions - Employees - 1,055,769 (1,055,769)
Net Investment Income - 6,185,108 (6,185,108)
Benefit Payments, Including Refunds of
Employee Contributions (7,017,816) (7,017,816)-
Administrative Expense -(177,337)177,337
Other Miscellaneous Income/(Expense) ---
Net Changes 5,909,507 2,482,843 3,426,664
Ending Balance $148,318,894 $ 128,275,375 $ 20,043,519
50
Notes to Financial Statements
Years Ended June 30, 2021 and 2020
7) DEFINED BENEFIT PENSION PLAN - Continued
C) Changes in the Net Pension Liability - Continued
The changes in the Net Pension Liability for the Plan for June 30, 2020:
Increase (Decrease)
Total Pension
Liability
Plan Fiduciary
Net Position
Net Pension
Liability/(Asset)
Beginning Balance $135,659,308 $ 87,270,402 $ 48,388,906
Changes in the Year:
Service Cost 2,586,911 -2,586,911
Interest on the Total Pension Liability 9,638,674 - 9,638,674
Changes in Benefit Terms - - -
Changes in Assumptions - - -
Differences Between Expected and Actual
Experience 1,183,213 - 1,183,213
Net Plan to Plan Resource Movement - - -
Contributions - Employer -36,706,983 (36,706,983)
Contributions - Employees - 1,019,255 (1,019,255)
Net Investment Income - 7,516,686 (7,516,686)
Benefit Payments, Including Refunds of
Employee Contributions (6,658,719) (6,658,719)-
Administrative Expense -(62,278)62,278
Other Miscellaneous Income/(Expense) -203 (203)
Net Changes 6,750,079 38,522,130 (31,772,051)
Ending Balance $142,409,387 $ 125,792,532 $ 16,616,855
51
Notes to Financial Statements
Years Ended June 30, 2021 and 2020
7) DEFINED BENEFIT PENSION PLAN - Continued
C) Changes in the Net Pension Liability - 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:
2021 2020
1% Decrease 6.15% 6.15%
Net Pension Liability $ 38,999,382 $ 35,122,134
Current Discount Rate 7.15% 7.15%
Net Pension Liability $ 20,043,519 $ 16,616,855
1% Increase 8.15% 8.15%
Net Pension Liability $ 4,253,474 $ 1,228,256
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 years ended June 30, 2021 and 2020, the District recognized pension expense of $3,962,800
and $6,567,636. At June 30, 2021 and 2020, the District reported deferred outflows of resources and
deferred inflows of resources related to pensions from the following services:
Deferred Outflows
of Resources
Deferred Inflows of
Resources
2021 2020 2021 2020
Pension contributions subsequent to measurement date $ 3,965,952 $ 2,465,751 $ - $ -
Differences between actual and expected experience 501,977 892,614 --
Changes in assumptions - - - (375,038)
Net difference between projected and actual earnings
on pension plan investments 953,594 - - (991,620)
Total $ 5,421,523 $ 3,358,365 $ - $ (1,366,658)
52
Notes to Financial Statements
Years Ended June 30, 2021 and 2020
7) DEFINED BENEFIT PENSION PLAN - Continued
D) Pension Expenses and Deferred Outflows/Inflows of Resources Related to Pensions - Continued
For fiscal year 2020, $2,465,751 reported as deferred outflows of resources related to contributions
subsequent to the measurement date was recognized as a reduction of the net pension liability
during the year ended June 30, 2021. For fiscal year 2021, $3,965,952 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 year ended June 30, 2022. 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
Year Ended Outflow/(Inflows)
June 30 of Resources
2022 $ 104,548
2023 323,029
2024 495,413
2025 532,581
2026 -
Thereafter -
E) Payable to the Pension Plan
At June 30, 2021 and 2020, the District reported a payable of $91,450 and $72,881, respectively, for
the outstanding amount of contributions to the pension plan required for the years ended June 30,
2021 and 2020. These payables are reflected in the accrued payroll liabilities on the Statements of
Net Position.
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 Comprehensive Annual Financial Report. Copies of the CalPERS’ annual financial report may
be obtained from the CalPERS Executive Office, 400 P Street, Sacramento, California 95814.
53
Notes to Financial Statements
Years Ended June 30, 2021 and 2020
8) OTHER POST EMPLOYMENT BENEFITS (OPEB) - Continued
Plan Description - Continued
Prior to the plan agreements signed in 2011, the eligibility in the plan was broken into 3 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, II or III employees,
and up to 100% spouse premium until death of retiree or age 65 whichever is greater and dependent
premium up to age 19 depending on the tier.
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.
Employees Covered
As of June 30, 2020 and 2019 actuarial valuations, the following current and former employees were
covered by the benefit terms under the Plan:
2020 2019
Active employees 133 133
Inactive employees or beneficiaries currently receiving benefits 76 76
Inactive employees entitled to, but not yet receiving benefits - -
Total 209 209
Contributions
The annual contribution is based on the actuarially determined contribution. For the fiscal years ended
June 30, 2021 and 2020, the District’s cash contributions were $807,867 and $1,011,358, respectively, in
payments to the trust.
54
Notes to Financial Statements
Years Ended June 30, 2021 and 2020
8) OTHER POST EMPLOYMENT BENEFITS (OPEB) - Continued
Net OPEB Liability
The District’s net OPEB liability was measured as of June 30, 2020 and 2019 and the total OPEB liability
used to calculate the net OPEB liability was determined by actuarial valuations dated June 30, 2020 and
2019 based on the following actuarial methods and assumptions:
Actuarial Assumptions
Discount Rate 7.00%
Inflation 2.75%
Salary Increases 2.75% plus merit
Investment Rate of Return 7.00%
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 6.00% PPO decreasing to 5.00% PPO
Notes:
(1)Pre-retirement mortality information was derived from data collected during 1997 to 2011 CalPERS Experience Study dated January
2014 and post-retirement mortality information was derived from the 2007 to 2011 CalPERS Experience Study. The Experience
Study Reports may be access on the CalPERS website www.calpers.ca.gov under Forms and Publications.
(2)The pre-retirement turnover information was developed based on CalPERS specific data. For more details, please refer to the 2007
to 2011 Experience Study Report. The Experience Study Report may be accessed on the CalPERS website www.calpers.ca.gov
under Forms and Publications.
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, 2020 and 2019 actuarial valuations:
Long-term
Target Expected Real
Asset Class Allocation Rate of Return
2020 2019 2020 2019
Global Equity 59.0% 59.0% 5.5% 5.5%
Global Fixed Income 25.0% 25.0% 2.35% 2.35%
TIPS 5.0% 5.0% 1.50% 1.50%
Commodities 3.0% 3.0% 1.75% 1.75%
REITs 8.0% 8.0% 3.65% 3.65%
Total 100% 100%
55
Notes to Financial Statements
Years Ended June 30, 2021 and 2020
8) OTHER POST EMPLOYMENT BENEFITS (OPEB) - Continued
Discount Rate
The discount rate used to measure the total OPEB liability was 7.00% for the June 30, 2020 and 2019
actuarial valuations. The projection of cash flows used to determine the discount rate assumed that District
contributions will be made at rates equal to the actuarially determined contribution rates. Based on those
assumptions, the OPEB plan’s fiduciary net position was projected to be available to make all projected
OPEB payments for current active and inactive employees and beneficiaries. Therefore, the long-term
expected rate of return on OPEB plan investments was applied to all periods of projected benefit payments
to determine the total OPEB liability.
Changes in the OPEB Liability (Asset)
The changes in the net OPEB liability (asset) for the Plan are as follows:
June 30, 2021 Increase (Decrease)
Total OPEB
Liability
(a)
Plan
Fiduciary
Net Position
(b)
Net OPEB
Liability/(Asset)
(c) = (a) - (b)
Balance at June 30, 2020
(Valuation Date June 30, 2019) $ 27,177,329 $ 27,197,350 $ (20,021)
Changes Recognized for the Measurement
Period:
Service Cost 735,529 - 735,529
Interest 1,915,358 - 1,915,358
Differences between expected and actual
experience
1,151,927
-
1,151,927
Changes of Assumptions - - -
Contributions - Employer - 1,011,358 (1,011,358)
Net Investment Income - 983,790 (983,790)
Benefit Payments (1,120,146) (1,120,146) -
Administrative Expenses - (13,514) 13,514
Other Expenses - - -
Net Changes 2,682,668 861,488 1,821,180
Balance at June 30, 2021
(Measurement Date June 30, 2020)
$ 29,859,997
$ 28,058,838
$ 1,801,159
56
Notes to Financial Statements
Years Ended June 30, 2021 and 2020
8) OTHER POST EMPLOYMENT BENEFITS (OPEB) - Continued
Changes in the OPEB Liability (Asset) - Continued
June 30, 2020 Increase (Decrease)
Total OPEB
Liability
(a)
Plan
Fiduciary
Net Position
(b)
Net OPEB
Liability/(Asset)
(c) = (a) - (b)
Balance at June 30, 2019
(Valuation Date June 30, 2018) $ 27,964,563 $ 24,549,538 $ 3,415,025
Changes Recognized for the Measurement
Period:
Service Cost 757,725 -757,725
Interest 1,970,613 -1,970,613
Differences between expected and actual
experience (2,029,118) - (2,029,118)
Changes of Assumptions (345,110) -(345,110)
Contributions - Employer - 2,206,363 (2,206,363)
Net Investment Income -1,595,092 (1,595,092)
Benefit Payments (1,141,344) (1,141,344)-
Administrative Expenses -(12,299)12,299
Other Expenses -- -
Net Changes (787,234) 2,647,812 (3,435,046)
Balance at June 30, 2020
(Measurement Date June 30, 2019) $ 27,177,329 $ 27,197,350 $ (20,021)
57
Notes to Financial Statements
Years Ended June 30, 2021 and 2020
8) OTHER POST EMPLOYMENT BENEFITS (OPEB) - Continued
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 periods ended June 30, 2020 and 2019:
1% Decrease
Current
Discount Rate 1% Increase
2021 Net OPEB Liability (Asset) $ 6,374,570 $ 1,801,159 $ (1,912,135)
(2020 Measurement Period)
2020 Net OPEB Liability (Asset) $ 4,124,269 $ (20,021) $ (3,385,633)
(2019 Measurement Period)
Sensitivity of the Net OPEB Liability to Changes in the Health Care 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 periods ended June 30, 2020 and 2019:
1% Decrease
(5.00% HMO/5.00% PPO
Decreasing to
4.00% HMO/4.00% PPO)
Current Healthcare Cost
Trend Rates
(6.00% HMO/6.0% PPO
Decreasing to
5.00% HMO/5.00% PPO)
1% Increase
(7.00% HMO/7.00% PPO
Decreasing to
6.00% HMO/6.00% PPO)
2021 Net OPEB Liability (Asset) $ (2,525,323) $ 1,801,159 $ 7,256,118
(2020 Measurement Period)
2020 Net OPEB Liability (Asset) $ (3,730,121) $ (20,021) $ 4,639,466
(2019 Measurement Period)
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.
58
Notes to Financial Statements
Years Ended June 30, 2021 and 2020
8) OTHER POST EMPLOYMENT BENEFITS (OPEB) - Continued
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)
OPEB Expense and Deferred Outflows/Inflows of Resources Related to OPEB
For the fiscal years ended June 30, 2021 and 2020, the District recognized OPEB expense of $(660,336)
and $(692,893), respectively. As of fiscal years ended June 30, 2021 and 2020, the District reported
deferred outflows of resources related to OPEB from the following sources:
Deferred Outflows
of Resources
Deferred Inflows of
Resources
2021 2020 2021 2020
OPEB contributions subsequent to measurement date $ 807,867 $1,011,358 $ - $ -
Differences between expected and actual experience 1,007,936 - (1,217,470) (1,623,294)
Changes in assumptions - - (207,066) (276,088)
Net difference between projected and actual earnings
on OPEB plan investments
623,829
128,177
-
(374,867)
Total $ 2,439,632 $1,139,535 $(1,424,536) $(2,274,249)
59
Notes to Financial Statements
Years Ended June 30, 2021 and 2020
8) OTHER POST EMPLOYMENT BENEFITS (OPEB) - Continued
OPEB Expense and Deferred Outflows/Inflows of Resources Related to OPEB - Continued
For the fiscal year 2020, $1,011,358 reported as deferred outflows of resources related to contribution
subsequent to the measurement date was recognized as a reduction of the net OPEB liability during the
year ended June 30, 2021. The $807,867 reported as deferred outflows of resources related to
contributions subsequent to the June 30, 2021 measurement date will be recognized as a reduction of
the net OPEB liability during the fiscal year ending June 30, 2022. Other amounts reported as deferred
outflows of resources related to OPEB will be recognized as expense as follows:
Deferred
Year Ended Outflow/(Inflows)
June 30, of Resources
2022 (285,559)
2023 (150,694)
2024 (115,645)
2025 327,155
2026 143,991
Thereafter 287,981
9) COMMITMENTS AND CONTINGENCIES
Construction Commitments
The District had committed to capital projects under construction with an estimated cost to complete of
$2,912,364 and $2,706,350 at June 30, 2021 and 2020, respectively.
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 potential case, see below, that could have a significant effect on the
District’s financial position.
The District is involved in a class action lawsuit regarding its single-family residential tiered water rates
between July 2014 and current which were based on industry standard cost-of-service studies. Although
the District believes no significant damages are involved, there is an uncertainty, due to recent cases, on
the likelihood of a favorable decision to the District. The amount of potential loss is currently unavailable
due to the complex nature of the case and the uncertainty of the outcome.
60
Notes to Financial Statements
Years Ended June 30, 2021 and 2020
9) COMMITMENTS AND CONTINGENCIES - Continued
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, 2021, 1,750 EDUs had been relinquished and refunded, 15,091
EDUs had been connected, and 1,026 EDUs have neither been relinquished nor connected. At June 30,
2020, 1,750 EDUs had been relinquished and refunded, 15,088 EDUs had been connected, and 1,029 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. As of June 30, 2021 and 2020, none of the outstanding developer agreements had been
accepted.
COVID-19 Pandemic
On March 11, 2020, the World Health Organization declared the novel strain of coronavirus (COVID-19)
a global pandemic and recommended containment and mitigation measures worldwide. The
pandemic continued subsequent to year end with certain restrictions required by the Governor of
California, as well as local governments, which may affect revenue sources and also caused subsequent
stock market volatility. The duration of the pandemic and the future impact of COVID-19 on the District’s
operational and financial performance is uncertain at this time.
10) 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. Beginning in July 2020, the District began participation as 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
61
Notes to Financial Statements
Years Ended June 30, 2021 and 2020
10) RISK MANAGEMENT - Continued
General Liability and Property - Continued
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:
x $50,000 per occurrence for third party general liability property damage;
x $50,000 per occurrence for third party auto liability property damage;
Employee Dishonesty Coverage: Total of $1,000,000 per loss includes Public Employee Dishonesty,
Forgery or Alteration and Theft and Faithful Performance of Duty effective July 1, 2020.
Property Loss: Replacement cost, for property on file, paid on an actual cash value basis, to a combined
total of $500 million per occurrence, subject to a $1,000 deductible per occurrence, effective July 1, 2020.
Boiler and Machinery: Replacement cost up to $100 million per occurrence, subject to a $1,000 deductible,
effective July 1, 2020.
Comprehensive and Collision: Deductibles of $1,000, as elected; ACV limits; fully self-funded by ACWA,
effective July 1, 2020.
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, 2020.
Cyber Coverage: $5,000,000 Annual Aggregate Limit of Liability for each Insured/Member for Information
Security & Privacy Liability. Policy includes $50,000 deductible per claim.
11) SEGMENT INFORMATION
The District has issued Water and Wastewater Revenue Bonds in the current and 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.
62
Notes to Financial Statements
Years Ended June 30, 2021 and 2020
11) SEGMENT INFORMATION - Continued
Summary financial information for the water and wastewater services is presented for June 30, 2021 and
2020:
Condensed Statements of Net Position
June 30, 2021 and 2020
Water Services Wastewater Services
2021 2020 2021 2020
ASSETS
Cash and Investments $ 87,912,162 $ 73,048,806 $ 4,480,939 $ 4,457,368
Accounts Receivable, Net 14,646,890 13,244,367 194,047 175,737
Other Current Assets 3,914,774 3,365,177 68,548 96,132
Net OPEB Asset - 19,191 - 830
Capital Assets 422,067,977 426,126,556 29,494,427 30,376,193
Total Assets 528,541,803 515,804,097 34,237,961 35,106,260
DEFERRED OUTFLOWS OF RESOURCES
Deferred Actuarial Pension Costs 5,310,729 3,306,371 110,794 51,994
Deferred Actuarial OPEB Costs 2,357,742 1,094,697 81,890 44,838
Total Deferred Outflows of Resources 7,668,471 4,401,068 192,684 96,832
LIABILITIES
Accounts Payable 14,666,147 16,040,522 69,579 183,595
Other Miscellaneous Liabilities 5,163,174 4,970,208 732,692 485,818
Other Current Liabilities 11,376,893 10,474,774 95,247 30,247
General Obligation Bonds 739,080 1,460,435 - -
Revenue Bonds 102,442,795 107,381,011 3,042,012 3,106,551
Net Pension Liability 19,518,744 16,194,242 524,775 422,613
Net OPEB Liability 1,750,085 - 51,074 -
Other Non-current Liabilities 3,793,011 3,550,571 - -
Total Liabilities 159,449,929 160,071,763 4,515,379 4,228,824
DEFERRED INFLOWS OF RESOURCES
Deferred Actuarial Pension Costs - 1,323,207 - 43,451
Deferred Actuarial OPEB Costs 1,365,120 2,190,616 59,416 83,633
Total Deferred Inflows of Resources 1,365,120 3,513,823 59,416 127,084
NET POSITION
Net Investment in Capital Assets 313,995,974 317,886,828 26,387,415 27,269,642
Restricted for Debt Service 4,187,443 4,261,399 - -
Unrestricted 57,211,808 34,471,352 3,468,435 3,577,542
Total Net Position $ 375,395,225 $ 356,619,579 $ 29,855,850 $ 30,847,184
63
Notes to Financial Statements
Years Ended June 30, 2021 and 2020
Condensed Statements of Revenues, Expenses and Changes in Net Position
For the Years Ended June 30, 2021 and 2020
Water Services Wastewater Services
2021 2020 2021 2020
Operating Revenues
Water Sales $101,742,970 $ 90,435,148 $ - $ -
Wastewater Revenue - - 2,899,180 2,921,310
Connection and Other Fees 2,495,491 2,570,891 2,827 11,460
Total Operating Revenues 104,238,461 93,006,039 2,902,007 2,932,770
Operating Expenses
Cost of Water Sales 66,889,570 62,573,257 - -
Wastewater - - 2,633,413 2,439,117
Administrative and General 21,948,435 25,196,555 - -
Depreciation 16,076,720 15,886,575 1,136,185 892,392
Total Operating Expenses 104,914,725 103,656,387 3,769,598 3,331,509
Operating Income (Loss) (676,264) (10,650,348) (867,591) (398,739)
Non-operating Revenues (Expenses)
Investment Earnings 246,906 1,734,364 7,762 50,470
Taxes and Assessments 5,249,898 4,939,950 1,642 -
Availability Charges 634,887 645,996 51,810 48,772
Gain (Loss) on Sale of Capital Assets (159,734) (1,243,742) - -
Rents and Leases 1,587,687 1,501,328 - -
Miscellaneous Revenues 5,057,827 1,750,411 4,952 185,751
Donations (84,389) (121,600) - -
Interest Expense (4,695,529) (4,903,602) (86,961) (50,385)
Miscellaneous Expenses (197,587) (453,971) (43,792) (104,434)
Total Non-operating Revenues (Expenses) 7,639,966 3,849,134 (64,587) 130,174
Income (Loss) Before Capital Contributions
and Transfers 6,963,702 (6,801,214) (932,178) (268,565)
Capital Contributions 11,644,043 6,825,909 108,745 116,023
Transfers In (Out) 167,901 193,829 (167,901) (193,829)
Change in Net Position 18,775,646 218,524 (991,334) (346,371)
Total Net Position, Beginning 356,619,579 356,401,055 30,847,184 31,193,555
Total Net Position, Ending $375,395,225 $356,619,579 $ 29,855,850 $ 30,847,184
11) SEGMENT INFORMATION - Continued
64
Notes to Financial Statements
Years Ended June 30, 2021 and 2020
11) SEGMENT INFORMATION - Continued
Condensed Statements of Cash Flows
For the Years Ended June 30, 2021 and 2020
Water Services Wastewater Services
2021 2020 2021 2020
Net Cash Provided/(Used) by:
Operating Activities $ 19,202,814 $ 10,725,595 $ 362,894 $ 586,205
Non-capital and Related Financing Activities 5,286,158 5,035,871 (116,091) (145,056)
Capital and Related Financing Activities (9,989,088) (17,036,778) (230,994) 1,386,775
Investing Activities 437,895 17,445,293 7,762 2,629,444
Net Increase (Decrease) in
Cash and Cash Equivalents 14,937,779 16,169,981 23,571 4,457,368
Cash and Cash Equivalents, Beginning 69,308,286 53,138,305 4,457,368 -
Cash and Cash Equivalents, Ending $ 84,246,065 $ 69,308,286 $ 4,480,939 $ 4,457,368
65
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68
Schedule of Changes in the Net OPEB Liability and Related
Ratios for Measurement Periods Ended June 30,
Last Ten Fiscal Years (1)
Measurement Period 2020 2019 2018 2017
Total OPEB Liability
Service Cost $ 735,529 $ 757,725 $ 735,655 $ 687,528
Interest on the Total OPEB Liability 1,915,358 1,970,613 1,864,967 1,764,343
Actual and Expected Experience Difference 1,151,927 (2,029,118) - -
Changes in Assumptions - (345,110) - -
Changes in Benefit Terms - - - -
Benefit Payments (1,120,146) (1,141,344) (1,085,586) (1,039,420)
Net Change in Total OPEB Liability 2,682,668 (787,234) 1,515,036 1,412,451
Total OPEB Liability - Beginning 27,177,329 27,964,563 26,449,527 25,037,076
Total OPEB Liability - Ending (a) $29,859,997 $27,177,329 $27,964,563 $26,449,527
Plan Fiduciary Net Position
Contributions - Employer $ 1,011,358 $ 2,206,363 $ 2,202,004 $ 2,284,420
Net Investment Income 983,790 1,595,092 1,734,626 2,011,985
Benefit Payments (1,120,146) (1,141,344) (1,085,586) (1,039,420)
Administrative Expenses (13,514) (12,299) (11,784) (10,167)
Other Expenses - - (28,757) -
Net Change in Plan Fiduciary Net Position 861,488 2,647,812 2,810,503 3,246,818
Plan Fiduciary Net Position - Beginning 27,197,350 24,549,538 21,739,035 18,492,217
Plan Fiduciary Net Position - Ending (b) $28,058,838 $27,197,350 $24,549,538 $21,739,035
Net OPEB Liability/(Asset) - Ending (a)-(b) $ 1,801,159 $ (20,021) $ 3,415,025 $ 4,710,492
Plan Fiduciary Net Position as a Percentage of the
Total OPEB Liability
94.0%
100.1%
87.8%
82.2%
Covered-Employee Payroll $13,538,959 $13,176,602 $12,677,000 $12,513,000
Net OPEB Liability/(Asset) as a Percentage of
Covered- Employee Payroll
13.3%
-0.2%
26.9%
37.6%
Notes to Schedule:
(1) Historical information is required only for measurement periods for which GASB 75 is applicable. Future years’ information will be
displayed up to 10 years as information becomes available. Contributions are determined by an actuarial valuation based on eligible
participants’ estimated medical and dental benefits.
69
Schedule of Contributions
For Fiscal Year Ended June 30,
Last Ten Fiscal Years (1)
Fiscal
Year
Actuarially
Determined
Contribution
(ADC)
Contributions in
Relation to the
ADC
Contribution
Deficiency
(Excess)
Covered-
Employee
Payroll
Contributions as a
Percentage of Covered-
Employee 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) $ - $ 13,917,932 5.80%
Notes to Schedule:
The actuarial methods and assumptions used to set the actuarially determined contributions for Fiscal Year
2021 were from the June 30, 2020 actuarial valuation. Also note, that some of the data from prior years were
updated with the most current available information.
Methods and assumptions used to determine contributions:
Actuarial Cost Method Entry Age Normal
Amortization Method/Period Level percent of payroll over a closed rolling 15-year period
Asset Valuation Method Market value
Inflation 2.75%
Payroll Growth 2.75% plus merit
Investment Rate of Return 7.00% per annum
Healthcare Cost-trend Rates 6.00% HMO/6.00% PPO decreasing to 5.00% HMO/5.00% PPO
Retirement Age Tier 1 employees - 2.7% at 55 and Tier 2 employees - 2.0% at 62.
The probabilities of Retirement are based on the 2014 CalPERS
Experience Study for the period from 1997 to 2011.
Mortality Pre-retirement mortality and post-retirement mortality probability
based on CalPERS Experience Study with mortality improvements
using Mortality Improvement Scale MP2018.
(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.
70
Schedule of Changes in the Net Pension Liability
and related Ratios for Fiscal Years Ended June 30,
Last Ten Fiscal Years (1)
Measurement Period2 2019-2020 2018-2019 2017-2018 2016-2017
TOTAL PENSION LIABILITY
Service Cost $ 2,623,208 $ 2,586,911 $ 2,528,271 $ 2,556,902
Interest 10,043,778 9,638,674 9,168,092 8,836,284
Changes of Benefit Terms - - - -
Changes of Assumptions - - (1,312,634) 7,308,486
Difference Between Expected and Actual
Experience 260,337 1,183,213 461,917 (1,208,593)
Benefit Payments, Including Refunds of
Employee Contributions
(7,017,816)
(6,658,719)
(5,995,949)
(5,779,040)
Net Change in Total Pension Liability 5,909,507 6,750,079 4,849,697 11,714,039
Total Pension Liability - Beginning 142,409,387 135,659,308 130,809,611 119,095,572
Total Pension Liability - Ending (a) $ 148,318,894 $ 142,409,387 $ 135,659,308 $ 130,809,611
PLAN FIDUCIARY NET POSITION
Net Plan to Plan Resource Movement $ - $ - $ (203) $ -
Contributions - Employer 2,437,119 36,706,983 4,441,517 4,105,810
Contributions - Employee 1,055,769 1,019,255 1,015,008 1,014,329
Net Investment Income 6,185,108 7,516,686 6,949,676 8,149,097
Benefit Payments, Including Refunds of
Employee Contributions
(7,017,816)
(6,658,719)
(5,995,949)
(5,779,040)
Administrative Expense (177,337) (62,278) (126,575) (109,029)
Other Changes in Fiduciary Net Position - 203 (240,367) -
Net Change in Fiduciary Net Position 2,482,843 38,522,130 6,043,107 7,381,167
Plan Fiduciary Net Position - Beginning 125,792,532 87,270,402 81,227,295 73,846,128
Plan Fiduciary Net Position - Ending (b) $ 128,275,375 $ 125,792,532 $ 87,270,402 $ 81,227,295
Plan Net Pension Liability/(Asset) -
Ending (a) - (b) $ 20,043,519 $ 16,616,855 $ 48,388,906 $ 49,582,316
Plan Fiduciary Net Position as a Percentage
of the Total Pension Liability
86.49%
88.33%
64.33%
62.10%
Covered Payroll $ 13,383,715 $ 12,892,655 $ 12,969,485 $ 12,829,415
Plan Net Pension Liability/(Asset) as a
Percentage of Covered Payroll
149,76%
128.89%
373.10%
386.47%
Continued
1 Measurement period 2019-20 (fiscal year 2020-2021) was the seventh year of implementation; therefore, only seven years are shown.
2 Historical information is required only for measurement periods for which GASB 68 is applicable
Notes to Schedule:
Benefit Changes: The figures above do not include any liability impact that may have resulted from plan
changes which occurred after June 30, 2016. This applies for voluntary benefit changes as well as any offers
of Two Years Additional Service Credit (a.k.a. Golden Handshakes).
Changes of Assumptions: For the 2021, 2020, 2019 and 2017 fiscal years, there were no changes. For the 2018
fiscal year, the accounting discount rate reduced from 7.65% to 7.15%. For the 2016 fiscal year, amounts
reported reflect an adjustment the discount rate of 7.5% (net of administrative expense) to 7.65% (without a
reduction for pension plan administrative expense). In 2014, amounts reported were based on the 7.5%
discount rate.
71
Schedule of Changes in the Net Pension Liability
and related Ratios for Fiscal Years Ended June 30,
Last Ten Fiscal Years (1)
Measurement Period2 2015-2016 2014-2015 2013-2014
TOTAL PENSION LIABILITY
Service Cost $ 2,298,617 $ 2,250,860 $ 2,330,709
Interest 8,575,275 8,229,312 7,907,915
Changes of Benefit Terms - - -
Changes of Assumptions - (1,996,819) -
Difference Between Expected and Actual
Experience (613,440) (981,200) -
Benefit Payments, Including Refunds of
Employee Contributions
(5,448,218)
(5,288,251)
(4,885,406)
Net Change in Total Pension Liability 4,812,234 2,213,902 5,353,218
Total Pension Liability - Beginning 114,283,338 112,069,436 106,716,218
Total Pension Liability - Ending (a) $119,095,572 $114,283,338 $112,069,436
PLAN FIDUCIARY NET POSITION
Net Plan to Plan Resource Movement $ - $ - $ -
Contributions - Employer 3,819,770 3,557,098 3,137,174
Contributions - Employee 1,010,337 1,007,023 1,074,954
Net Investment Income 369,214 1,601,760 10,874,999
Benefit Payments, Including Refunds of
Employee Contributions
(5,448,218)
(5,288,251)
(4,885,406)
Administrative Expense (45,185) (83,511) -
Other Changes in Fiduciary Net Position - - -
Net Change in Fiduciary Net Position (294,082) 794,119 10,201,721
Plan Fiduciary Net Position - Beginning 74,140,210 73,346,091 63,144,370
Plan Fiduciary Net Position - Ending (b) $ 73,846,128 $ 74,140,210 $ 73,346,091
Plan Net Pension Liability/(Asset) -
Ending (a) - (b) $ 45,249,444 $ 40,143,128 $ 38,723,345
Plan Fiduciary Net Position as a Percentage
of the Total Pension Liability
62.01%
64.87% 65.45%
Covered Payroll $ 12,767,963 $ 12,451,513 $ 12,276,578
Plan Net Pension Liability/(Asset) as a
Percentage of Covered Payroll
354.40%
322.40%
315.42%
1 Measurement period 2019-20 (fiscal year 2020-2021) was the seventh year of implementation; therefore, only seven years are shown.
2 Historical information is required only for measurement periods for which GASB 68 is applicable.
72
Schedule of Plan Contributions
For Fiscal Year Ended June 30,
Last Ten Fiscal Years (1)
Fiscal
Year
Actuarially
Determined
Contribution2
Contributions in
Relation to the
Actuarially
Determined
Contribution2
Contribution
Deficiency
(Excess)
Covered
Payroll3
Contributions as a
Percentage of
Covered Payroll3
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) $ 13,917,932 28.50%
1Historical information is required only for measurement periods for which GASB 68 is applicable.
2 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.
3 Includes one year’s payroll growth assumption using 2.75% payroll growth assumption for fiscal years 2018-2020; 3.00% payroll growth
assumption for fiscal years 2015-2017.
Notes to Schedule:
The actuarial methods and assumptions used to set the actuarially determined contributions for Fiscal Year
2020-21 were from the June 30, 2018 public agency valuations. Also note, that some of the data from prior
years were updated with the most current available information.
Actuarial Cost Method Entry Age Normal
Amortization Method/Period For details see June 30, 2018 Funding Valuation Report
Asset Valuation Method Actuarial Value of Assets. For details, see June 30, 2018 Funding
Valuation Report
Discount Rate 7.00%
Inflation 2.50%
Salary Increases Varies by Entry Age and Service
Payroll Growth 2.75%
Investment Rate of Return 7.00% Net of Pension Plan Investment and Administrative Expenses;
includes Inflation
Retirement Age
The probabilities of Retirement are based on the 2017 CalPERS
Experience Study.
Mortality
The probabilities of mortality are based on the 2017 CalPERS
Experience Study.
73
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74
Statistical Schedules
The Statistical Schedule is part of understanding what the information in the financial statements, note
disclosures, and required supplementary information says about the District’s overall financial health.
Contents Page
Financial Trends 76
These schedules contain trend information to help the reader understand how the
District’s financial performance and well-being have changed over time.
Revenue Capacity 82
These schedules contain information to help the reader assess the factors affecting the
District’s ability to generate its potable and recycled water, and sewer sales as well as
property tax.
Debt 92
These schedules present information to help the reader assess the affordability of the
District’s current levels of outstanding debt and the District’s ability to issue additional
debt.
Demographic and Economic Information 98
These schedules offer demographic and economic indicators to help the reader
understand the environment within which the District’s financial activities take place
and to help make comparisons over time and with other governments.
Operating Information 100
These schedules contain information about the District’s operation and resources to
help the reader understand how the District’s financial information relates to the
services the District provides and the activities it performs.
Sources
Unless otherwise noted, the information in these schedules is derived from the annual comprehensive
financial reports of the relevant year.
75
Fiscal Net Investment Total
Year in Capital Assets Restricted Unrestricted Net Position
2021 340,383,389$ 4,187,443$ 60,680,243$ 405,251,075$
2020 345,156,470 4,261,399 38,048,894 387,466,763
2019 354,639,520 4,248,007 28,707,083 387,594,610
2018 355,628,577 4,247,025 27,664,926 387,540,528 (1)
2017 350,981,714 4,306,724 45,898,551 401,186,989
2016 351,617,201 4,402,301 45,268,275 401,287,777
2015 354,046,090 4,658,306 43,717,930 402,422,326 (2)
2014 357,912,154 3,855,673 83,039,993 444,807,820
2013 376,549,168 4,612,890 67,071,849 448,233,907
2012 381,725,015 4,715,904 67,701,068 454,141,987
(1)For Fiscal Year ending June 30, 2018, the $13.6 million decrease of Total Net Position is primarily a result of the
implementation of GASB Statement No. 75 "Accounting and Financial Reporting for Postemployment Benefits Other
Than Pensions-an amendment of GASB Statement No. 45”. Implementation of this standard decreased the net
position at July 1, 2017 by $17.8 million and recognized a net OPEB liability, deferred outflows of resources, and
expenses related to the OPEB plan.
(2)For Fiscal Year ending June 30, 2015, the $42.4 million decrease of Total Net Position is primarily due to the
implementation of Governmental Accounting Standards Board (GASB) Statements No. 68 "Accounting and
Financial Reporting for Pensions-an amendment of GASB Statement No. 27" and No. 71 "Pension Transistions
for Contributions Made Subsequent to the Measurement Date-an amendment of GASB No. 68". Implementation
of these standards resulted in a decrease of Net Position at July 1, 2014 by $40.4 million.
Source: Otay Water District
Net Position by Component - Last Ten Fiscal Years
$0
$50,000
$100,000
$150,000
$200,000
$250,000
$300,000
$350,000
$400,000
$450,000
$500,000
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
Total Net Positon, in Thousands ($)
76
Total
Operating Non-Operating Income/ (Loss) Changes
Fiscal Operating Operating Income/Revenues/Before Capital Capital in Net
Year Revenues Expenses (Loss)(Expenses)Contributions Contributions Position
2021 107,140,468$ 108,684,323$ (1,543,855)$ 7,575,379$ 6,031,524$ 11,752,788$ 17,784,312$
2020 95,938,809 106,987,896 (11,049,087) 3,979,308 (7,069,779) 6,941,932 (127,847)
2019 91,952,166 103,728,988 (11,776,822) 2,374,095 (9,402,727) 9,456,809 54,082
2018 97,473,772 105,734,349 (8,260,577) 2,923,999 (5,336,578) 9,506,192 4,169,614
2017 88,481,254 96,624,381 (8,143,127) 2,471,420 (5,671,707) 5,570,919 (100,788)
2016 78,876,307 89,669,543 (10,793,236) 2,687,368 (8,105,868) 6,971,319 (1,134,549)
2015 83,865,407 91,863,728 (7,998,321) 2,965,607 (5,032,714) 3,081,894 (1,950,820)
2014 86,025,573 92,567,023 (6,541,450) (277,057) (6,818,507) 3,392,420 (3,426,087)
2013 76,881,388 87,335,338 (10,453,950) 1,770,738 (8,683,212) 2,775,132 (5,908,080)
2012 68,400,349 81,795,466 (13,395,117) 3,511,327 (9,883,790) 6,825,897 (3,057,893)
Source: Otay Water District
Changes in Net Position - Last Ten Fiscal Years
-$10,000
-$5,000
$0
$5,000
$10,000
$15,000
$20,000
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
Changes in Net Position, in Thousands ($)
77
Fiscal Connection and Percent
Year Water Sales Wastewater Other Fees Total Change
2021 101,742,970$ 2,899,180$ 2,498,318$ 107,140,468$ 11.7%
2020 90,435,148 2,921,310 2,582,351 95,938,809 4.3%
2019 86,756,222 2,961,157 2,234,787 91,952,166 -5.7%
2018 92,595,195 2,865,520 2,013,057 97,473,772 10.2%
2017 83,720,150 2,983,495 1,777,609 88,481,254 12.2%
2016 73,940,200 3,175,300 1,760,807 78,876,307 -5.9%
2015 79,135,000 3,044,158 1,686,249 83,865,407 -2.5%
2014 81,287,164 2,791,523 1,946,886 86,025,573 11.9%
2013 72,187,081 2,625,087 2,069,220 76,881,388 12.4%
2012 63,830,272 2,400,313 2,169,764 68,400,349 8.2%
Source: Otay Water District
Operating Revenues by Source - Last Ten Fiscal Years
$0
$20,000
$40,000
$60,000
$80,000
$100,000
$120,000
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
Operating Revenues, in Thousands ($)
78
Fiscal Cost of Administrative Percent
Year Water Sales Wastewater and General Depreciation Total Change
2021 66,889,570$ 2,633,413$ 21,948,435$ 17,212,905$ 108,684,323$ 1.6%
2020 62,573,257 2,439,117 25,196,555 16,778,967 106,987,896 3.1%
2019 60,065,964 2,784,579 24,070,648 16,807,797 103,728,988 -1.9%
2018 62,321,213 2,501,240 23,445,578 17,466,318 105,734,349 9.4%
2017 56,882,487 1,964,855 19,991,542 17,785,497 96,624,381 7.8%
2016 51,826,046 2,051,913 19,318,247 16,473,337 89,669,543 -2.4%
2015 54,364,884 1,866,711 19,437,141 16,194,992 91,863,728 -0.8%
2014 56,068,147 1,834,465 18,608,603 16,055,808 92,567,023 6.0%
2013 50,600,551 1,638,354 18,550,811 16,545,622 87,335,338 6.8%
2012 46,106,403 2,547,929 17,926,430 15,214,704 81,795,466 5.9%
Source: Otay Water District
Operating Expenses by Function - Last Ten Fiscal Years
$0
$20,000
$40,000
$60,000
$80,000
$100,000
$120,000
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
Operating Expenses, in Thousands ($)
Cost of Water Sales Wastewater Administrative and General Depreciation
79
Fiscal Investment Taxes and Availability Rents and Percent
Year Earnings Assessments Charges Leases Miscellaneous Total Change
2021 254,668$ 5,251,540$ 686,697$ 1,587,687$ 5,062,779$ 12,843,371$ 18.3%
2020 1,784,834 4,939,950 694,768 1,501,328 1,936,162 10,857,042 -6.1%
2019 1,978,392 4,671,182 723,246 1,384,211 2,800,613 11,557,644 20.4%
2018 723,860 4,481,719 697,724 1,439,247 2,255,605 9,598,155 -10.6%
2017 408,754 4,114,583 729,325 1,375,305 4,107,558 10,735,525 20.7%
2016 758,004 3,966,593 616,591 1,281,150 2,274,623 8,896,961 -0.6%
2015 656,925 3,856,276 685,555 1,232,920 2,521,078 8,952,754 15.2%
2014 522,286 3,537,162 729,961 1,317,736 1,661,992 7,769,137 -0.2%
2013 22,155 3,545,595 707,881 1,276,914 2,233,804 7,786,349 -14.9%
2012 436,596 3,502,155 696,863 1,222,060 3,288,111 9,145,785 4.4%
Source: Otay Water District
Non-Operating Revenues by Source - Last Ten Fiscal Years
$0
$2,000
$4,000
$6,000
$8,000
$10,000
$12,000
$14,000
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
Non-Operating Revenues, in Thousands ($)
80
Fiscal Interest Percent
Year Donations (1)Expense Miscellaneous Total Change
2021 84,389$ 4,782,490$ 401,113$ (7)5,267,992$ -23.4%
2020 121,600 4,953,987 1,802,147 (6)6,877,734 -25.1%
2019 118,040 4,713,883 4,351,626 (5)9,183,549 37.6%
2018 123,050 3,941,321 2,609,785 6,674,156 -19.2%
2017 125,742 5,069,767 3,068,596 (4)8,264,105 33.1%
2016 120,722 4,603,093 1,485,778 6,209,593 3.7%
2015 117,462 4,545,530 1,324,155 5,987,147 -25.6%
2014 119,687 4,872,060 3,054,447 (3)8,046,194 33.8%
2013 120,684 3,977,538 1,917,389 6,015,611 6.8%
2012 121,617 3,899,927 1,612,914 (2)5,634,458 35.6%
(1)Donations are contributions to the Water Conservation Authority formed in 1999.
(2)Miscellaneous expense includes $1.4 million of non-capitalizable expenses with corresponding miscellaneous revenues. In
prior years these expenses and revenues were presented, net of revenue, in miscellaneous revenues.
(3)Miscellaneous expense includes $2.3 million of non-capitalizable expenses which were partially funded by capacity revenue.
(4)Miscellaneous expense includes $1.8 million of non-capitalizable expenses which were primarily funded by capacity revenue.
(5)Miscellaneous expense includes $3.0 million of non-capitalizable expenses which were partially funded by capacity revenue
and $1.1 million loss on disposal of capital assets.
(6)Miscellaneous expense includes $0.4 million of non-capitalizable expenses which were partially funded by capacity revenue
and $1.2 million loss on disposal of capital assets.
(7)Miscellaneous expense includes $0.2 million of non-capitalizable expenses which were partially funded by capacity revenue
and $0.2 million loss on disposal of capital assets.
Source: Otay Water District
Non-Operating Expenses by Function - Last Ten Fiscal Years
$0
$2,000
$4,000
$6,000
$8,000
$10,000
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
Non-Operating Expenses, in Thousands ($)
Miscellaneous Interest Expense Donations
81
Fiscal Total Direct
Year Real Personal Total Tax Rate
2021 33,891,881,238$ 675,894,658$ 34,567,775,896$ 1.00%
2020 32,068,524,548 570,816,478 32,639,341,026 1.00%
2019 30,175,832,441 591,916,883 30,767,749,324 1.00%
2018 28,808,597,510 578,765,787 29,387,363,297 1.00%
2017 27,060,627,238 538,359,438 27,598,986,676 1.00%
2016 25,506,243,489 551,455,064 26,057,698,553 1.00%
2015 24,109,906,912 572,400,598 24,682,307,510 1.00%
2014 22,739,584,104 564,518,965 23,304,103,069 1.00%
2013 22,253,255,369 583,080,854 22,836,336,223 1.00%
2012 22,556,489,450 588,978,085 23,145,467,535 1.00%
Source: County of San Diego Auditor and Controller
Last Ten Fiscal Years
Assessed Valuation of Taxable Property within the District -
$0
$5,000,000
$10,000,000
$15,000,000
$20,000,000
$25,000,000
$30,000,000
$35,000,000
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
Assessed Valuation of Property, In Thousands ($)
82
Fiscal
Year Purchases Sales Production Purchases Sales
2021 13,079,077 12,604,100 281,830 1,598,358 (2)1,799,377
2020 11,995,858 11,390,483 382,670 1,070,079 (3)1,451,957
2019 11,928,819 11,326,752 323,690 1,168,780 1,462,632
2018 12,910,269 12,227,383 377,450 1,460,271 1,810,502
2017 11,762,115 11,250,331 242,800 1,386,600 1,625,768
2016 11,108,105 10,475,290 439,650 1,163,117 1,591,677
2015 13,198,201 12,744,425 443,090 1,447,737 1,841,956
2014 14,554,049 13,720,119 503,120 1,664,630 2,068,330
2013 13,888,496 13,189,042 486,610 1,415,610 1,878,950
2012 13,304,444 12,510,894 285,190 1,381,300 1,652,833
(1)Rates are not presented on this schedule because the District has multiple water rates for various meter sizes
and customer classes and cannot represent rates in a meaningful manner with a weighted average rate. See
Water and Sewer rates on pages 87-90 for meter sizes and their corresponding water rates.
(2)In FY 2021, recycled water purchases from the City of San Diego increased due to the District's plant being shut
down from November 2020 through February 2021 for capital improvements.
(3)In FY 2020, recycled water purchases from the City of San Diego declined due to the City's plant being shut
down from January to June of 2020.
Source: Otay Water District
Per 100 Cubic Feet
Water Purchases, Production, and Sales - Last Ten Fiscal
Years
Recycled Water(1)
Per 100 Cubic Feet
Potable Water(1)
0
5,000,000
10,000,000
15,000,000
20,000,000
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
Recycled Purchases Recycled Production Potable Purchases
Water Purchases, Productions, and Sales, in Hundred Cubic Feet (HCF)
83
Fiscal
Year Total(1)
2021 270 27 297
2020 302 4 306
2019 463 12 475
2018 574 14 588
2017 109 9 118
2016 116 4 120
2015 138 8 146
2014 195 3 198
2013 305 5 310
2012 457 24 481
(1) Meters may not be activated in the year sold.
Source: Otay Water District
Meter Sales by Type - Last Ten Fiscal Years
Potable Recycled
0
200
400
600
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
Meter Sales by Type
Recycled Potable
84
Fiscal
Year Potable Recycled Sewer Total
2021 51,204 753 4,736 56,693
2020 50,994 735 4,737 56,466
2019 50,555 726 4,737 56,018
2018 50,045 724 4,714 55,483
2017 49,502 721 4,683 54,906
2016 49,425 708 4,677 54,810
2015 49,308 705 4,679 54,692
2014 49,148 702 4,657 54,507
2013 48,962 704 4,655 54,321
2012 48,665 696 4,655 54,016
Source: Otay Water District
Number of Customers by Service Type - Last Ten Fiscal Years
0
7,500
15,000
22,500
30,000
37,500
45,000
52,500
60,000
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
Number of Customers by Service Type
Recycled Sewer Potable
85
Fiscal
Year 1% Property Tax
Special
Assessments
Total
Levies
Total
Collections (1)
End of the Year
Percent
Collected
2021 $ 4,469,198 $ 2,007,723 $ 6,476,921 $ 6,377,533 98%
2020 4,203,245 2,013,450 6,216,694 6,122,835 98%
2019 4,036,261 2,023,939 6,060,200 5,955,998 98%
2018 3,795,363 1,960,771 5,756,134 5,691,467 99%
2017 3,539,836 1,999,480 5,539,316 5,532,395 100%
2016 3,367,615 1,998,874 5,366,489 5,127,563 96%
2015 3,276,296 2,012,420 5,288,716 5,071,336 96%
2014 3,032,618 2,096,409 5,129,027 4,885,718 95%
2013 3,014,180 2,139,415 5,153,595 4,790,286 93%
2012 3,115,841 2,108,269 5,224,110 4,809,293 92%
(1)Levies and collections include Current Secured, Current Unsecured, and Supplemental Homeowners Exemptions.
Source: Otay Water District
Property Tax Levies and Collections - Last Ten Fiscal Years
$0
$1,000
$2,000
$3,000
$4,000
$5,000
$6,000
$7,000
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
Levies and Collections, in Thousands ($)
Levy Collections
86
Fixed Rates 2021 2020 2019 2018 2017 2016 2015 2014 2013 2012
System Charge by Meter Size
Residential Potable
3/4"19.27$ 18.87$ 18.05$ 17.38$ 15.91$ 18.91$ 19.39$ 16.19$ 16.74$ 14.58$
1"27.24 26.67 25.51 24.56 22.47 26.71 27.39 22.87 21.26 18.52
1.5"47.12 46.13 44.13 42.49 38.88 46.22 47.40 39.58 32.57 28.37
3/4"42.38 41.49 39.69 38.21 15.91 18.91 19.39 16.19 16.74 14.58
1"59.84 58.59 56.05 53.97 22.47 26.71 27.39 22.87 21.26 18.52
1.5"103.55 101.38 96.98 93.37 38.88 46.22 47.40 39.58 32.57 28.37
2"155.94 152.67 146.04 140.61 58.55 69.61 71.39 59.62 46.13 40.18
3"295.73 289.53 276.96 266.66 111.04 132.02 135.41 113.08 82.29 71.68
4"453.03 443.54 424.28 408.50 170.10 202.24 207.43 173.22 122.99 107.13
6"890.03 871.38 833.54 802.55 334.18 397.31 407.50 340.29 236.02 205.59
8"1,414.36 1,384.73 1,324.59 1,275.34 531.05 631.37 647.56 540.76 371.64 323.73
10"2,026.07 1,983.62 1,897.47 1,826.91 760.72 904.44 927.63 774.64 529.88 461.57
3/4"39.92 39.08 37.38 35.99 15.91 18.91 19.39 16.19 16.74 14.58
1"56.37 55.19 52.79 50.83 22.47 26.71 27.39 22.87 21.26 18.52
1.5"97.54 95.50 91.35 87.95 38.88 46.22 47.40 39.58 32.57 28.37
2"146.90 143.82 137.57 132.45 58.55 69.61 71.39 59.62 46.13 40.18
3"278.57 272.73 260.89 251.19 111.04 132.02 135.41 113.08 82.29 71.68
4"426.73 417.79 399.65 384.79 170.10 202.24 207.43 173.22 122.99 107.13
6"838.39 820.82 785.17 755.97 334.18 397.31 407.50 340.29 236.02 205.59
8"1,332.27 1,304.36 1,247.71 1,201.32 531.05 631.37 647.56 540.76 371.64 323.73
10"1,908.45 1,868.46 1,787.32 1,720.86 760.72 904.44 927.63 774.64 529.88 461.57
3/4"33.71 33.00 31.57 30.40 15.91 18.91 19.39 16.19 16.74 14.58
1"47.61 46.61 44.59 42.93 22.47 26.71 27.39 22.87 21.26 18.52
1.5"82.38 80.65 77.15 74.28 38.88 46.22 47.40 39.58 32.57 28.37
2"124.04 121.44 116.17 111.85 58.55 69.61 71.39 59.62 46.13 40.18
3"235.25 230.32 220.32 212.13 111.04 132.02 135.41 113.08 82.29 71.68
4"360.40 352.85 337.53 324.98 170.10 202.24 207.43 173.22 122.99 107.13
6"708.03 693.20 663.10 638.44 334.18 397.31 407.50 340.29 236.02 205.59
8"1,125.15 1,101.58 1,053.74 1,014.56 531.05 631.37 647.56 540.76 371.64 323.73
10"1,611.76 1,577.99 1,509.46 1,453.33 760.72 904.44 927.63 774.64 529.88 461.57
3/4"41.54 40.21 38.14 36.85 15.91 18.91 19.39 16.19 16.74 14.58
1"58.65 56.78 53.86 52.04 22.47 26.71 27.39 22.87 21.26 18.52
1.5"101.51 98.27 93.21 90.06 38.88 46.22 47.40 39.58 32.57 28.37
2"152.88 148.00 140.38 135.63 58.55 69.61 71.39 59.62 46.13 40.18
3"289.91 280.65 266.21 257.21 111.04 132.02 135.41 113.08 82.29 71.68
4"444.11 429.92 407.80 394.01 170.10 202.24 207.43 173.22 122.99 107.13
6"872.49 844.62 801.16 774.07 334.18 397.31 407.50 340.29 236.02 205.59
8"1,386.49 1,342.20 1,273.13 1,230.08 531.05 631.37 647.56 540.76 371.64 323.73
10"1,986.14 1,922.69 1,823.75 1,762.08 760.72 904.44 927.63 774.64 529.88 461.57
Continued
Water Fixed Rates - Last Ten Fiscal Years
Landscape, Agricultural & Construction Potable
Public Agency & Commercial Potable
Master Meter Potable
Recycled Commercial
87
Fixed Rates 2021 2020 2019 2018 2017 2016 2015 2014 2013 2012
Water Fixed Rates - Last Ten Fiscal Years
System Charge by Meter Size
3/4"35.07$ 33.95$ 32.20$ 31.11$ 15.91$ 18.91$ 19.39$ 16.19$ 16.74$ 14.58$
1"49.53 47.95 45.48 43.94 22.47 26.71 27.39 22.87 21.26 18.52
1.5"85.71 82.97 78.70 76.04 38.88 46.22 47.40 39.58 32.57 28.37
2"129.06 124.94 118.51 114.50 58.55 69.61 71.39 59.62 46.13 40.18
3"244.76 236.94 224.75 217.15 111.04 132.02 135.41 113.08 82.29 71.68
4"374.97 362.99 344.31 332.67 170.10 202.24 207.43 173.22 122.99 107.13
6"747.91 724.02 686.76 663.54 334.18 397.31 407.50 340.29 236.02 205.59
8"1,170.62 1,133.22 1,074.91 1,038.56 531.05 631.37 647.56 540.76 371.64 323.73
10"1,676.89 1,623.32 1,539.79 1,487.72 760.72 904.44 927.63 774.64 529.88 461.57
Fire Services
All Types 30.11
Less than 3 inch 23.03 22.55 21.57 20.77 20.77 24.69 25.32 21.14 34.57
4 inch and higher 31.03 30.38 29.06 27.98 27.98 33.27 34.12 28.49 34.57
CWA and MWD Pass-through charges by Meter Size
Residential Potable
3/4"16.36 15.56 15.10 15.45 15.00 16.84 13.67 14.45 13.28 14.01
1"30.38 28.89 28.04 28.68 27.84 31.24 25.35 26.79 22.12 23.33
1.5"68.67 65.31 63.40 64.85 62.96 70.66 57.35 60.61 44.31 46.74
Non-Residential & Other Potable
3/4"16.36 15.56 15.10 15.45 15.00 16.84 13.67 14.45 13.28 14.01
1"30.38 28.89 28.04 28.68 27.84 31.24 25.35 26.79 22.12 23.33
1.5"68.67 65.31 63.40 64.85 62.96 70.66 57.35 60.61 44.31 46.74
2"116.81 111.10 107.84 110.30 107.08 120.17 97.53 103.08 70.85 74.74
3"248.44 236.29 229.36 234.60 227.75 255.60 207.44 219.23 141.71 149.48
4"397.83 378.38 367.29 375.68 364.72 409.32 332.20 351.09 221.43 233.58
6"814.38 774.56 751.85 769.02 746.59 837.89 680.02 718.69 442.80 467.09
8"1,315.14 1,250.83 1,214.16 1,241.89 1,205.65 1,353.09 1,098.15 1,160.59 708.53 747.39
10"1,892.97 1,800.41 1,747.63 1,787.55 1,735.39 1,947.62 1,580.67 1,670.55 1,015.06 1,070.74
Source: Otay Water District
Recycled Irrigation
88
Water Rate 2021 2020 2019 2018(2)2017 2016 2015 2014 2013 2012
Tier 1 (conservation tier)-$ -$ -$ -$ 2.53$ 2.13$ 1.95$ 1.86$ 1.73$ 1.58$
Tier 2 3.38 3.31 3.17 3.05 3.95 3.32 3.04 2.90 2.69 2.45
Tier 3 6.04 5.91 5.65 5.44 5.13 4.32 3.95 3.77 3.50 3.19
Tier 4 7.79 7.63 7.30 7.03 7.90 6.65 6.08 5.80 5.39 4.92
Tier 1 3.16 3.09 2.96 2.85 3.90 3.28 3.00 2.86 2.66 2.43
Tier 2 5.73 5.61 5.37 5.17 5.05 4.25 3.89 3.71 3.45 3.15
Tier 3 7.05 6.90 6.60 6.35 7.80 6.56 6.00 5.73 5.32 4.85
Government Fee (1)0.42 0.42 0.42 0.41 0.41 0.37 0.32 0.31 0.29 0.29
Tier 1 4.00 3.92 3.75 3.61 4.17 3.51 3.21 3.06 2.84 2.59
Tier 2 4.23 3.56 3.26 3.14 2.92 2.66
Tier 3 4.30 3.62 3.31 3.19 2.96 2.70
Tier 1 5.84 5.72 5.47 5.27 5.68 4.78 4.37 4.17 3.87 3.53
Tier 2 5.74 4.83 4.42 4.25 3.95 3.60
Tier 3 5.81 4.89 4.47 4.32 4.01 3.66
Tier 1 3.40 3.29 3.12 3.01 3.53 2.97
Tier 2 3.60 3.03
Tier 3 3.65 3.07
Government Fee (1)0.42 0.42 0.42 0.41 0.41 0.37 0.32 0.31 0.29 0.29
Tier 1 4.80 4.65 4.41 4.26 4.85 4.08 3.73 3.56 3.31 3.02
Tier 2 4.92 4.14 3.79 3.61 3.35 3.06
Tier 3 4.99 4.20 3.84 3.68 3.42 3.12
Energy Pumping Fee
Per 100 cubic feet(3)0.0063 0.060 0.056 0.053 0.044 0.072 0.050 0.048 0.042 0.045
(1) An additional charge per unit is assessed to governmental customers in lieu of tax revenues.
(2) Effective 2018, there is no more conservation tier for residential; and there is only one tier each for Public Agency & Commercial,
Landscape, Agricultural & Construction, Recycled Commercial, and Recycled Irrigation.
(3) Water customers are charged an energy pumping charge based on the quantity of water used and the elevation to which the water
has been lifted to provide service. The energy pumping charge is the rate of $.060 per 100 cubic feet of water for each 100 feet of
lift above the base elevation of 450 feet. All water customers are in one of twenty-nine zones based on elevation.
Source: Otay Water District
Water Variable Rates - Last Ten Fiscal Years
Recycled Irrigation
Recycled Commercial
Public Agency & Commercial
Landscape, Agricultural & Construction
Master Meter
Residential
89
Description 2021 2020 2019 2018 2017 2016 2015 2014 2013** 2012
Per Unit 2.96$ 2.93$ 2.67$ 2.77$ 2.58$ 2.46$ 2.46$ 2.46$ 2.35$ 1.77$
Low Strength 2.96 2.93 2.67 2.77 2.58 2.46 2.46 2.46 2.35
Medium Strength 3.37 3.64 3.31 3.98 3.70 3.53 3.53 3.53 3.37
High Strength 4.75 5.01 4.56 6.34 5.90 5.63 5.63 5.63 5.37
Sewer Rate Per ASU 41.75
3/4"16.55 16.38 14.91 17.08 15.89 27.07 15.89 15.89 14.38 12.26
1"16.55 16.38 14.91 17.08 15.89 27.07 15.89 15.89 14.38 17.88
3/4"16.55 16.38 14.91 30.50 28.37 27.07 27.07 27.07 25.83
1"41.36 40.94 37.27 44.94 41.80 39.86 39.86 39.86 38.03
1.5"82.71 81.88 74.55 80.92 75.27 71.82 71.82 71.82 68.53
2"132.33 131.00 119.27 124.12 115.46 110.17 110.17 110.17 105.12
3"248.13 245.64 223.64 224.93 209.24 199.66 199.66 199.66 190.52
4"413.55 409.40 372.73 368.97 343.23 327.51 327.51 327.51 312.51
6"827.09 818.79 745.45 729.04 678.18 647.12 647.12 647.12 617.48
8"1,323.36 1,310.08 1,192.73 1,161.15 1,080.14 1,030.67 1,030.67 1,030.67 983.46
10"1,902.34 1,883.23 1,714.54 1,665.25 1,549.07 1,478.12 1,478.12 1,478.12 1,410.42
Calculation of Monthly Residential Sewer Billing:
Bill calculation beginning calendar year 2008: (Winter Average(8) x .85(2) x Sewer Rate) + Fixed Rate(7)
Bill calculation beginning calendar year 2021: (3-Year Winter Average(9) x .85 (2) x Sewer Rate) + Fixed Rate(7)
Calculation of Monthly Non-Residential Sewer Billing:
Footnotes:
(1)Flow in gallons per day (Flow) is calculated using monthly readings from account's water meter.
(2)Flow is reduced by 15% to reflect that not all water purchased is disposed of into the public sewer system.
(3)Flow is divided by 250 gallons per day to convert it into terms of residential equivalence.
(4)Strength factors for business customers are categorized as low, medium or high strength.
(5)The average annual usage is defined as the units of water billed from January-December of previous year.
(6)The Sewer Rate is a per unit charge based on the commercial account's strength factor as shown on the rates table as being
either Low, Medium, or High.
(7)The fixed rate is based on the size of the water meter.
(8)The winter average for a residential customer is defined as the units of water billed from January-April of the previous
calendar year divided by the number of months of service.
(9)The three-year winter average is defined as the sum of prior three years annual winter average divided by three. The annual
winter average is defined as the units of water billed from January through April divided by four.
Source: Otay Water District
Non-Residential
Sewer Variable and Fixed Rates - Last Ten Fiscal Years
Fixed Rates
Sewer Rates
**Bill calculation prior to calendar year 2012: (Flow in gallons per day(1) x .85(2) /250(3)) x Strength Factor(4)
Bill calculation beginning calendar year 2013: (Average Annual Usage(5) x .85(2) x Sewer Rate(6)) + Fixed Rate(7))
Residential
Non-Residential
Residential
90
Customer Name Customer Type Annual
Revenues
% of Water
Sales
1. City of Chula Vista Publicly Owned 4,333,495$ 4.3%
2.Eastlake III Community Association Commercial 1,195,042 1.2%
3. County of San Diego Publicly Owned 1,037,209 1.0%
4. Richard J Donovan Correctional Facility Publicly Owned 991,496 1.0%
5. Homefed Village III Temporary 911,451 0.9%
6.Chula Vista Elementary School District Publicly Owned 724,173 0.7%
7. Eastlake Country Club Commercial Recycled 675,846 0.7%
8.Baldwin & Sons, LLC Temporary 583,305 0.6%
9.Rolling Hills Community Association Commercial 476,973 0.5%
10. Elite Athlete Services, LLC Commercial 468,319 0.5%
Total Top Ten Customers 11,397,309$ 11.4%
Other Customers 90,345,661 88.6%
Total Water Sales 101,742,970$ 100.0%
Customer Name Customer Type Annual
Revenues
% of Water
Sales
1. City of Chula Vista Publicly Owned 2,534,914$ 4.0%
2. State of California Publicly Owned 983,882 1.5%
3. Eastlake Summit Association Commercial 741,847 1.2%
4. County of San Diego Commercial 703,141 1.1%
5. Sweetwater School District Publicly Owned 495,750 0.8%
6. Cuyamaca College Publicly Owned 459,615 0.7%
7. ERP Operating, LP Commercial 431,952 0.7%
8. Windingwalk Master Association Commercial 429,534 0.7%
9. Belleme Home Owners Association Commercial 399,036 0.6%
10. Eastlake Country Club Commercial 397,629 0.6%
Total Top Ten Customers 7,577,300$ 11.9%
Other Customers 56,252,972 88.1%
Total Water Sales 63,830,272$ 100.0%
Source: Otay Water District
Ten Largest Customers - Current Year and Nine Years Ago
Fiscal Year 2021
Fiscal Year 2012
91
As a Share
Fiscal Population GO Revenue Per of Personal
Year Estimate Bond COPS Bonds Total Capita Income (1)
2021 226,000 1,444,080$ -$ 110,029,807$ 111,473,887$ 493.25$ 0.99%
2020 226,000 2,140,435 -114,762,562 (5)116,902,997 517.27 1.00%
2019 225,000 2,806,789 -116,189,228 (4)118,996,017 528.87 0.93%
2018 225,000 3,458,143 7,593,293 84,170,550 95,221,986 423.21 0.73%
2017 224,000 4,079,498 8,192,548 87,134,618 99,406,664 443.78 0.80%
2016 220,000 4,680,853 8,791,803 (3)90,218,686 103,691,342 471.32 0.86%
2015 217,000 5,267,208 44,990,103 54,887,993 105,145,304 484.54 0.90%
2014 213,000 5,833,563 46,475,314 56,508,490 108,817,367 510.88 1.00%
2013 211,000 6,384,918 47,920,525 (2)58,158,987 112,464,430 533.01 1.06%
2012 208,500 6,921,271 58,023,740 50,321,421 115,266,432 552.84 1.14%
(1)See the Demographics and Economic Statistics schedule on page 99 for personal income data. Per Capita Personal Income used
in the calculation of "As a Share of Personal Income" is updated annually for the last ten fiscal years based on the most recent
LAEDC economic reports published. The Share of Personal Income is therefore adjusted to reflect the economic data update.
(2)2004 COPS were refunded with the issuance of 2013 Water Revenue Refunding Bonds in June 2013.
(3)2007 COPS were refunded with the issuance of 2016 Water Revenue Refunding Bonds in May 2016.
(4)In November 2018, the District issued $32,435,000 in Water Revenue Bonds, Series 2018, of which a portion of the proceeds was
used to advance refund $6,900,000 of the 1996 Certificates of Participation.
(5)In December 2019, the District issued $3,120,000 in Wastewater Revenue Bonds to pay for certain capital improvements to the
District's wastewater system.
Source: Otay Water District
Ratios of Outstanding Debt by Type - Last Ten Fiscal Years
$0
$100
$200
$300
$400
$500
$600
$700
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
Outstanding Debt, Per Capita
92
Adjusted Net Revenues
Fiscal Adjusted Operating Available for Debt Service Requirements (4)Coverage
Year Revenues (1)Expenses (2)Debt Service Principal Interest Total Factor (3)
2021 118,995,389$ 85,872,652$ 33,122,737$ 4,275,000$ 5,108,566$ 9,383,566$ 353%
2020 105,820,913 88,223,522 17,597,391 4,075,000 5,289,640 9,364,640 188%
2019 103,126,288 85,243,519 17,882,769 3,405,000 5,037,638 8,442,638 212%
2018 110,274,227 86,437,355 23,836,872 3,215,000 4,334,368 7,549,368 316%
2017 94,551,308 79,062,983 15,488,325 3,335,000 4,420,433 7,755,433 200%
2016 85,417,850 72,117,631 13,300,219 3,120,000 4,640,947 7,760,947 171%
2015 89,646,845 74,320,591 15,326,254 2,945,000 4,767,618 7,712,618 199%
2014 90,948,021 75,575,679 15,372,342 2,935,000 4,895,622 7,830,622 196%
2013 81,778,447 70,228,987 11,549,460 2,800,000 4,988,640 7,788,640 148%
2012 74,484,691 64,028,686 10,456,005 1,850,000 6,050,746 7,900,746 132%
(1)Adjusted revenues exclude sewer revenues and taxes collected for Improvement District 27 and are inclusive of capacity fees.
(2)Adjusted operating expenses exclude sewer expenses and depreciation expense.
(3)The District's bond covenants require a minimum coverage factor of 125%.
(4)Pledge debts are Revenue Bonds.
Source : Otay Water District
Pledged Revenue Coverage (Water) - Last Ten Fiscal Years
0%
50%
100%
150%
200%
250%
300%
350%
400%
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
Coverage Factor, in Percentage (%)
Actual Ratio Minimum ratio
93
Adjusted Net Revenues
Fiscal Sewer Operating Available for Debt Service Requirements (3)Coverage
Year Revenues Expenses (1)Debt Service Principal Interest Total Factor (2)
2021 3,072,532$ 2,677,205$ 395,327$ -$ 86,500$ 86,500$ 457%
2020 (5)3,061,829 2,439,432 622,397 - 50,154 50,154 1,241%
(1)Adjusted operating expenses exclude depreciation expense.
(2)The District's bond covenants require a minimum coverage factor of 115%.
(3)Pledge debts are Revenue Bonds.
(4)No wasterwater revenue bonds were issued between FY2011 and FY2019.
(5)In December 2019, the District issued $3,120,000 in Wastewater Revenue Bonds to pay for certain
capital improvements to the District's wastewater system.
Source : Otay Water District
Pledged Revenue Coverage (Wastewater) - Last Ten Fiscal Years (4)
0%
200%
400%
600%
800%
1000%
1200%
1400%
2020 2021
Coverage Factor, in Percentage (%)
Actual Ratio Minimum ratio
94
Net Bonded
Net Debt to Net Bonded
Fiscal Population Assessed Bonded Assessed Debt Per
Year Estimate Valuation Debt Valuation Capita
2021 226,000 34,567,775,896$ 1,444,080$ 0.004%6.39$
2020 226,000 32,639,341,026 2,140,435 0.007%9.47
2019 225,000 30,767,749,324 2,806,789 0.009%12.47
2018 225,000 29,387,363,297 3,458,143 0.012%15.37
2017 224,000 27,598,986,676 4,079,498 0.015%18.21
2016 220,000 26,057,698,553 4,680,853 0.018%21.28
2015 217,000 24,682,307,510 5,267,208 0.021%24.27
2014 213,000 23,304,103,069 5,833,563 0.025%27.39
2013 211,000 22,836,336,223 6,384,918 0.028%30.26
2012 208,500 23,145,467,535 6,921,271 0.030%33.20
Source: Otay Water District
Ratios of General Bonded Debt Outstanding - Last Ten Fiscal Years
0.00%
0.01%
0.02%
0.03%
0.04%
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
Bonded Debt Ratios, in Percentage (%)
95
Computation of Direct and Overlapping Bonded Debt
June 30, 2021
2020-21 Assessed Valuation: $34,567,775,896
Total Debt District’s Share of
DIRECT AND OVERLAPPING TAX AND ASSESSMENT DEBT: 6/30/2021 % Applicable (1) Debt 6/30/2021
Metropolitan Water District $26,830,000 1.057% $ 283,593
Otay Water District Improvement District No. 27 1,444,080 100. 1,444,080
Grossmont-Cuyamaca Community College District 399,720,377 14.644 58,535,052
Southwestern Community College District 535,971,833 41.287 221,286,691
Grossmont Union High School District 611,620,166 15.070 92,171,159
Sweetwater Union High School District 385,973,846 49.067 189,385,787
Chula Vista City School District and School Facilities Improvement
District 219,373,285 61.954 & 28.821 109,821,600
San Ysidro School District 147,108,310 50.618 74,463,284
Other School Districts 5,959,230,089 Various 50,731,589
Grossmont Healthcare District 249,978,330 13.474 33,344,609
City of Chula Vista Community Facilities District 132,990,000 100. 132,990,000
Sweetwater Union High School District Community Facilities
Districts 58,155,996 19.315 - 100. 54,575,342
City 1915 Act Bonds 6,015,000 100. 6,015,000
California Statewide Communities Development Authority Venture
Community Center and Sweetwater Place Assessment Districts 2,923,573 100. 2,923,573
TOTAL DIRECT AND OVERLAPPING TAX AND ASSESSMENT DEBT $1,027,971,359
DIRECT AND OVERLAPPING GENERAL FUND DEBT:
San Diego County General Fund Obligations $211,585,000 5.902% $ 12,487,747
San Diego County Pension Obligation Bonds 400,125,000 5.902 23,615,378
San Diego Superintendent of Schools Certificates of Participation 8,585,000 5.902 506,687
Otay Water District 110,029,807 100. 110,029,807
Southwestern Community College District General Fund
Obligations 490,000 41.287 202,306
Sweetwater Union High School District Certificates of Participation 36,105,000 49.067 17,715,640
Chula Vista City School District Certificates of Participation 143,795,000 61.954 89,086,754
San Ysidro School District Certificates of Participation 43,438,596 50.618 21,987,749
Other School District Certificates of Participation 59,489,723 Various 10,576,270
City of Chula Vista Certificates of Participation and Pension
Obligations 488,200,000 69.728 340,412,096
City of San Diego General Fund Obligations 593,804,429 0.835 4,958,267
TOTAL GROSS DIRECT AND OVERLAPPING GENERAL FUND DEBT $631,578,701
Less: Otay Water District Revenue Bonds (100% self-supporting) 110,029,807
TOTAL NET DIRECT AND OVERLAPPING GENERAL FUND DEBT $521,548,894
Continued
96
Computation of Direct and Overlapping Bonded Debt
OVERLAPPING TAX INCREMENT DEBT (Successor Agency): $22,770,000 16.319% $3,715,836
TOTAL GROSS DIRECT DEBT $111,473,887
TOTAL NET DIRECT DEBT 1,444,080 (3)
TOTAL OVERLAPPING DEBT $1,551,792,009
COMBINED TOTAL DEBT $1,553,217,009 (2)
Ratios to 2020-21 Assessed Valuation:
Direct Debt ($1,444,080) ............................................................................ 0.004%
Total Direct and Overlapping Tax and Assessment Debt .................. 2.97%
Combined Total Debt ......................................................................................... 4.49%
Ratios to Redevelopment Successor Agency Incremental Valuation ($361,133,863):
Total Overlapping Tax Increment Debt ...................................................... 1.03%
(1) The percentage of overlapping debt applicable to the district is estimated using taxable assessed property value. Applicable
percentages were estimated by determining the portion of the overlapping district's assessed value that is within the boundaries
of the water district divided by the overlapping district's total taxable assessed value.
(2) Excludes tax and revenue anticipation notes, enterprise revenue, mortgage revenue and non-bonded capital lease obligations.
Qualified Zone Academy Bonds are included based on principal due at maturity.
(3) Excludes $111,473,887 Revenue Bonds supported by water revenues and backed by a rate covenant.
Source: California Municipal Statistics, Inc. and Otay Water District
97
2012
% of Total % of Total
County County
Employer Employees Rank Employment Employees Rank Employment
Federal Government(1)47,800 1 3.38% 45,500 1 3.29%
University of California San Diego(2)35,807 2 2.53% 27,391 2 1.98%
County of San Diego(1)20,700 3 1.46% 15,687 3 1.14%
Sharp HealthCare(3)19,468 4 1.38% 15,231 4 1.10%
State of California(1)(4)17,700 5 1.25% 14,900 5 1.08%
Scripps Health(3)16,295 6 1.15% 14,097 7 1.02%
San Diego Unified School District(6)13,559 8 0.96% 14,603 6 1.06%
Qualcomm Inc.(5)13,000 7 0.92% 11,400 8 0.82%
City of San Diego(7)11,944 9 0.84% 10,057 9 0.73%
Kaiser Permanente(5)9,630 10 0.68% 7,731 10 0.56%
Total 205,903 14.55% 176,597 12.78%
Sources:
(1) California Employment Development Department Labor Market Information
(2) University of California
(3) San Diego Business Journal (Book of Lists)
(4) Excludes education
(5) County of San Diego
(6) San Diego Unified School District
(7) City of San Diego Adopted Fiscal Year 2022 Budget
Principal Employers - Current Year and Nine Years Ago
2021
98
Personal Per Capita
Fiscal Income Personal Unemployment
Year Population (in thousands)Income Rate
2021 3,315,400 165,481,000$ (1)49,913$ (1)8.01%
2020 3,343,400 173,279,000 51,827 6.06%
2019 3,351,800 191,558,000 57,151 3.31%
2018 3,337,500 194,633,000 58,317 3.57%
2017 3,316,200 184,260,000 55,563 4.37%
2016 3,288,600 179,717,000 54,649 4.86%
2015 3,275,500 177,300,000 53,628 5.75%
2014 3,212,300 172,900,000 51,190 7.11%
2013 3,182,100 161,100,000 50,288 7.40%
2012 3,143,429 154,200,000 48,674 9.30%
(1) Estimated Figure
Source: SANDAG; Census 2010, California Department of Finance; California Employment
Development Department; LAEDC-Los Angeles Economic Development Corp.
Demographic and Economic Statistics - Last Ten Fiscal Years
-
2.00%
4.00%
6.00%
8.00%
10.00%
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
Unemployment Rate, in Percentage (%)
99
Department 2021 2020 2019 2018 2017 2016 2015 2014 2013 2012
General Manager 5 5 5 6 6 5 5 5 5 5
Finance 31 31 31 29 31 32 34 34 36 39
Operations 54 53 52 52 51 51 51 51 54 54
Engineering 26 26 26 24 24 24 24 25 24 26
Administrative Services 23 23 23 23 23 26 26 28 29 31
Total 139 138 137 134 135 138 140 143 148 155
Source : Otay Water District
Number of Employees by Function - Last Ten Fiscal Years
0
25
50
75
100
125
150
175
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
Total Employees
100
Meter Size 2021 2020 2019 2018 2017 2016 2015 2014 2013 2012
3/4" & 5/8" 44,532 44,520 44,490 44,473 44,423 44,413 44,395 44,375 44,354 44,376
1"4,284 4,080 3,680 3,235 2,800 2,756 2,674 2,557 2,412 2,099
1-1/2"1,378 1,365 1,362 1,343 1,349 1,342 1,335 1,332 1,333 1,326
2"1,336 1,344 1,334 1,326 1,301 1,299 1,294 1,293 1,295 1,277
3"112 105 102 87 87 82 81 77 76 75
4"283 281 279 272 232 210 207 189 169 180
6"23 25 25 24 22 22 18 18 18 19
Others 9 9 9 9 9 9 9 9 9 9
Total 51,957 51,729 51,281 50,769 50,223 50,133 50,013 49,850 49,666 49,361
% Change 0.4% 0.9% 1.0% 1.1% 0.2% 0.2% 0.3% 0.4% 0.6% 1.1%
Increase 228 448 512 546 90 120 163 184 305 522
Source: Otay Water District
Active Meters by Size - Last Ten Fiscal Years
0
6,500
13,000
19,500
26,000
32,500
39,000
45,500
52,000
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
Active Meters by Size
101
2021 2020 2019 2018 2017 2016 2015 2014 2013 2012
Water System
Service Area (Square Miles) 125.5 125.5 125.5 125.5 125.5 125.5 125.5 125.5 125.5 125.5
Miles of Potable Water Main 726.0 723.0 723.0
(1) 727.0 727.0 727.0 727.0 726.0 725.0 724.0
Number of Operational
Storage Reservoirs in Service 40 40 40 40 40 40 40 40 40 40
Water Storage Capacity
(in Acre-Feet) 672.0 672.0 672.0 672.0 672.0 672.0 668.0 668.0 667.8 670.8
Total Potable Water Connections
(No. of Meters in Service)51,204 50,994 50,555 50,045 49,502 49,425 49,308 49,148 48,962 48,665
Number of Pump Stations 21 21 21 21 21 21 21 21 21 21
Number of Potable Water
Valves 21,218 20,981 20,746 20,746 20,746 20,746 20,676 20,460 20,317 20,317
Sewer System
Miles of Sewer Lines 88.0 84.0 84.0 (1)88.0 88.0 88.0 88.0 88.0 88.0 88.0
Number of Treatment Plants 1 1 1 1 1 1 1 1 1 1
Treatment Plant Capacity
(Million Gallons per Day)1.3 1.3 1.3 1.3 1.3 1.3 1.3 1.3 1.3 1.3
Total Flows for Fiscal
Year (in Million Gallons)394 399 388 381 393 336 388 405 422 423
Total Sewer Connections
(No. of Meters in Service)4,736 4,737 4,737 4,714 4,683 4,677 4,679 4,657 4,655 4,655
Recycled System
Miles of Recycled Water Mains 104.0 104.0 104.0 104.0 104.0 104.0 104.0 102.0 99.0 99.0
Number of Pumping Facilities 3 3 3 3 3 3 3 3 3 3
Number of Operational
Storage Reservoirs in Service 4 4 4 4 4 4 4 4 4 4
Number of Acre-Feet Storage 133.2 133.2 133.2
(1) 134.2 134.2 134.2 134.2 134.2 134.1 134.1
Connections
(No. of Meters in Service) 753 735 726 724 721 708 705 702 704 696
Number of Recycled
Water Valves 1,522 1,506 1,497 1,497 1,497 1,497 1,492 1,473 1,430 1,430
(1)For Fiscal Year ending June 30, 2019, the decreases are a result of sewer gravity mains now maintained by the County of San Diego.
Source : Otay Water District
Operating and Capital Indicators - Last Ten Fiscal Years
102