Heavy lifting ahead for incoming NID Board of Directors

GRASS VALLEY, Calif. December 5, 2018 – During yesterday’s Administrative Practices Committee a decision was made to have the incoming Board vote on the 2019 budget – a departure from the direction given at a previous board meeting. The irrigation district’s budget expires on December 31st and for a variety of reasons the current board has still not adopted the 2019 budget.

With $82,908,787 in revenues and $93,181,704 in projected expenses for 2019, NID will have to dip into their reserve funding to make up for the almost $10 million shortfall. Unless the new Board approves a rate increase – another action not taken by the current Board.

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Rates and budget approval at the first meeting of a new board?

During the committee meeting, Directors Nick Wilcox and Scott Miller (who sat in for the outgoing Will Morebeck) directed staff to bring both the proposed rate increase and the full 2019 budget to the December 12th meeting. Wilcox and Miller are the two remaining board members, they will be joined by incoming board members Ricki Heck, Chris Bierwagen and Laura Peters.

By law a budget must be submitted within 60 days after the beginning of a fiscal year to the County Auditor-Controller’s office.

NID staff prepared two versions of the budget, one without the anticipated rate increase that requires a $10.3 million reduction in reserves, up from $7.9 million.  With the proposed rate increase, the proposed 2019 Budget will require a $6.9 million
reduction in reserves, down from $7.9 million.

The rate increase was pulled from adoption at the last board meeting, leaving the issue unresolved. The three incoming board members will have to grapple with these complex issues after being sworn in.

General Manager Rem Scherzinger said after the meeting the two issues would be listed as separate items on one agenda as only a Board President can call for a special meeting. In the absence of Will Morebeck, Scherzinger was prepared to have a single meeting.

Next agenda to “only” deal with the 2019 budget

Later in the day, legal counsel weighed in and reportedly stated the rate increase and the budget could not be adopted during a single meeting. As it stands, the budget for 2019 will be on the agenda – with the rate increase being one of the assumptions like other revenue streams i.e. hydro generation revenue.

The incoming board members will be sworn in and immediately get to work on December 12, 2018 starting at 9:00 am.