NARRAGANSETT BAY COMMISSION R ATING AGENCY PRESENTATION P ROPOSED - PowerPoint PPT Presentation

NARRAGANSETT BAY COMMISSION R ATING AGENCY PRESENTATION P ROPOSED $268.7 MILLION WIFIA LOAN J ULY 29, 2019 1

ABOUT NBC • 1980 – Established by statute as the Narragansett Bay Water Quality Management District Commission Serving the Greater Providence Metropolitan Area • • 1992 former Blackstone Valley District Commission was merged into NBC Expanded the Service area • • 1997 Granted custody of own funds • 1999 Renamed the Narragansett Bay Commission • 1999 Union Employees transitioned from State Employee status to Narragansett Bay Commission Employee status 2

ORGANIZATION • NBC is governed by a 19 ‐ member Board of Commissioners 10 gubernatorial appointments • 9 appointments representing the communities in the service area • • Chairman is the Chief Executive Officer • Committee Structure • Monthly meetings Action Items • Executive Reports • Financial Reporting • Monthly financial statements • Operating budget transfers • Capital budget reallocations • Purchase requisitions • • 272 Employees – 118 union and 154 non ‐ union Union contracts through June 30, 2021 • Laborers’ International Union of North America ‐ Local 1033 • Rhode Island Council 94, American Federation of State, County and Municipal Employees ‐ Local 1010 and 2884 • 3

ORGANIZATION 4

LEADERSHIP Laurie Horridge Executive Director Appointed January 2019 27 years at NBC Environmental Science & Administration Construction & Engineering Finance Operations & Maintenance Compliance James McCaughey, P.E Margaret Goulet Richard Bernier, P.E. Karen Giebink Thomas Uva Director of Director of Operations & Director of Construction Chief Financial Director of Environmental Administration Maintenance & Engineering Officer Science & Compliance Appointed January 2019 Appointed April 2019 33 years at NBC 30 years at NBC 34 years at NBC 27 years at NBC 25 years at NBC Gregory Waugh Construction Manager Hired 2018 33 years of experience David Bowen, P.E. Engineering Manager Hired 2018 34 years of experience Kathryn Kelly, P.E. CSO Program Manager 19 years at NBC 5

COLLECTION AND TREATMENT FACILITIES Field’s Point WWTF ‐ Providence, RI Advanced treatment for dry weather flow of 65 MGD • 200 MGD total treatment capacity • CSO Tunnel Pump Station • 4 pump stations • 80 miles of interceptors • Bucklin Point WWTF ‐ East Providence, RI Advanced treatment for dry weather flow of 46 MGD • 116 MGD total treatment capacity • 3 pump stations • 30 miles of interceptors • CSO Phase I and Phase II Facilities Three ‐ mile long, 250 ‐ foot deep tunnel ‐ Operational in FY 2009 • Two main interceptors along the Seekonk River (7,000 feet) and the Woonasquatucket River • (17,200 feet) and a wetlands treatment facility ‐ Operational in FY 2015 6

SUSTAINABLE ENERGY FACILITIES Field’s Point Wind Turbines ‐ 2012 Three 1.5 MW wind turbines located at Field’s Point • “behind the meter” • Coventry Turbines ‐ 2016 Three 1.5 MW wind turbines off ‐ site • Generate Net Metering Credits • Power Purchase Agreements ‐ 2017 Two solar and one wind project • Shared Net Metering Credits • Biogas Reuse Biogas reuse project at Bucklin Point • “behind the meter” – not yet operational • 7

REGULATION • Rhode Island Public Utilities Commission (PUC) NBC’s Board and PUC must authorize adjustments to sewer user rates • General Rate Case – 9 months • Debt Service Compliance – 60 days • Division of Public Utilities and Carriers must approve debt issuance > 1 year • • Rhode Island Department of Environmental Management (RIDEM) and the US Environmental Protection Agency (EPA) New Consent Agreement signed in January 2019 • Third and Final Phase of Combined Sewer Overflow (CSO) Abatement Program New RIPDES Permits • More stringent limits for certain parameters cBOD TSS Enterococci – 35 mpn Resiliency study and other studies and evaluations 8

NBC CUSTOMER BASE Percent of Accounts by Community Top Ten Customers in FY 2018 Total Annual Percentage of Total Customer Billing FY 2018 Annual User Charges 1 Rhode Island Hospital $ 1,663,452 1.72% 2 Providence Housing Authority 1,628,527 1.69% 3 Brown University 1,241,906 1.29% 4 City of Pawtucket 663,778 0.69% 5 City of Providence 657,568 0.68% 6 Johnson & Wales University 551,497 0.57% 7 Rhode Island Resource Recovery 484,038 0.50% 8 Providence School Department 426,562 0.44% 9 Providence College 416,746 0.43% 10 State of Rhode Island 369,523 0.38% Number of Accounts by User Class 76,725 7,730 FY 2018 7,800 71,500 FY 2001 65,000 70,000 75,000 80,000 85,000 9 Residential Non ‐ Residential

FINANCIAL OVERVIEW Strong Financial Management Active operating budget management (27 years below budget) • Timely and complete financial reporting • Strong liquidity and debt service coverage • Comprehensive budget policies/debt policy • Excellent project oversight • Long ‐ Term Planning Strategic Plan • Fiscal Sustainability Plan • Use of long ‐ term financing model • Asset Management Program • Timely Rate Relief Debt service compliance filing mechanism • Good relationship with RIPUC and Division of Public Utilities • Excellent Customer Service Implemented a new customer service application in January 2019 • New online payment functionality and customer portal • Staggered billing cycles • Deferred collection activity during implementation • 10

FINANCIAL OVERVIEW • GFOA Distinguished Budget Presentation Award for the last 17 years and NBC’s FY 2019 Budget was awarded the following distinctions: Distinguished Budget Presentation Award FY 2019 Outstanding as a Special Performance Outstanding as an Outstanding as a Special Capital Communications Measures Operations Guide Financial Plan Recognition Device Recognition • Operating Budget + Capital Budget = NBC Budget • GFOA Certificate of Achievement for Excellence in Financial Reporting for the last 16 years FY 2002 through FY 2017 • Clean Audit Opinion with no management letter for 21 years 11

FY 2019 PERFORMANCE UNAUDITED FIGURES* Increase in Net Position of $27.8 M • Debt Service Coverage of 1.29x • June 30, 2019 Cash and Investments of $80.3 M • Unrestricted Cash and Cash Equivalents $ 21,257,284 Restricted Environmental Enforcement $ 69,948 Debt Service Payment Accounts 30,419,349 Stabilization Account 3,947,511 Operating Reserve for Revenue Stability Fund 4,508,560 Debt Service Reserve 3,503,652 Construction 16,587,145 Subtotal Restricted 59,036,165 Total $ 80,293,449 12 *Prior to Pension and OPEB entries and other audit adjustments

FY 2019 PERFORMANCE UNAUDITED FIGURES* Statement of Net Position Statement of Revenues, Expenses, and Changes in Net Position As of June 30, 2019 For the Period Ending June 30, 2019 Assets Operating Revenues Current assets $ 81,940,888 User Fees $ 97,271,851 Restricted assets 59,036,165 Other operating revenues 2,917,171 Capital assets (net) 1,025,324,109 100,189,022 Other assets 184,381 Operating Expenses Total assets 1,166,485,543 Personnel services 24,382,524 Operations and maintenance 1,412,815 Deferred Outflow of Resources Utilities 3,415,257 Deferred Outflows 8,375,297 Supplies 1,318,180 Total deferred outflows 8,375,297 Professional services 1,100,809 Depreciation and amortization 16,401,372 Liabilities Miscellaneous 9,740,870 Current liabilities 10,570,730 57,771,827 Noncurrent liabilities 635,358,573 Total liabilities 645,929,303 Operating Income 42,417,195 Deferred Inflows of Resources Non ‐ operating Revenue (Expenses) (15,671,390) Deferred Inflows of Resources 3,068,006 Total deferred inflows 3,068,006 Net income (loss) 26,745,805 Net Position Change in net position 26,745,805 Net Investment in capital assets 504,260,346 Restricted 8,082,160 Total net position ‐ beginning 498,117,723 Unrestricted 13,521,025 Total Net Position $ 525,863,531 Total net position ‐ ending $ 524,863,528 13 *Prior to Pension and OPEB entries and other audit adjustments

FY 2019 PERFORMANCE OPERATING BUDGET VS. ACTUAL UNAUDITED FIGURES* Revenue FY 2019 Budget FY 2019 Actual Difference Operating Revenue Total Operating Revenue $ 101,418,392 $ 100,189,022 $ (1,234,109) Non ‐ Operating Revenue Total Non ‐ Operating Revenue 387,800 435,412 47,612 Transfer from Revenue Fund Balance 1,600,000 1,600,000 ‐ Total Revenue $ 103,406,192 $ 102,224,434 $ (1,186,497) Expense FY 2019 Budget FY 2019 Actual Difference Operations & Maintenance Expense Total Operations & Maintenance $ 43,668,346 $ 41,370,455 $ (2,297,891) Debt Service Total Debt Service 47,787,187 46,576,163 (1,211,024) Transfer to Project Fund ‐ Restricted Account 11,950,659 11,950,659 ‐ Total Expense $ 103,406,192 $ 99,897,277 $ (3,508,915) Surplus (Deficit) $ ‐ $ 2,327,157 $ 2,322,418 14 *Prior to Pension and OPEB entries and other audit adjustments