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ORSANCO Fiscal Year 2017 Budget Presentation April 26, 2016 1 - PowerPoint PPT Presentation

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ORSANCO Fiscal Year 2017 Budget Presentation April 26, 2016 1 What Will Be Presented Today Presentation Overview Status of Recommendations from April 2015 P&F Committee Meeting (Agenda #4) Review Budget Process (Agenda #5)

  1. ORSANCO Fiscal Year 2017 Budget Presentation April 26, 2016 1

  2. What Will Be Presented Today • Presentation Overview • Status of Recommendations from April 2015 P&F Committee Meeting (Agenda #4) • Review Budget Process (Agenda #5) • Proposed Program Activities for FY17 (Agenda #5) • Resources Overview (Agenda #5) • Proposed FY17 Budget (Agenda #5) • Five Year Revenue & Expenditure Forecast (Agenda #5) • Proposed Plan to Increase Funding (Agenda #5 ) • State Funding Considerations (Agenda #6) • Summary of Recommendations (Agenda #7) 2

  3. Budget Message Overview • Presenting a cost effective FY17 Budget • FY 17 – FY 21 Five Year Revenue and Expenditure Forecast – No increase in EPA 106 grant funding – 1% increase in FY 17 & FY 18 State funding; 0% increase in FY19-FY21 – 1.3% annual projected increase in expenditures – 1.7% annual projected decrease in revenue • Carryover Resources – Projected to be $2,052,398 going into FY17 – Utilize $171,077 in FY17 – Utilize $1,919,828 FY17-FY21 – End FY21 balance of $132,570 ($48,799 Restricted Reserve) • Potential Future Programs list developed – Identify future funding opportunities • Need for ORSANCO Strategic Plan Update 3

  4. Status of April 2015 Program & Finance Committee Recommendations Adoption of FY16 program plan & associated budget • Adopted June 2015 Adoption of 1% state funding increase for FY18 • Adopted June 2015 Develop short and long term ODS funding strategies for the operation and refurbishment of the system • Updates provided 6/8/15 & 12/23/15 • Draft business plan distributed • Overview to be presented to P&F Committee on 4/26/16 Develop a 3-5 year budget forecast • Forecast to be presented to P&F Committee on 4/26/16 Pension Committee continue comprehensive Plan review • Update & recommendations to be presented to P&F Committee on 4/26/16 4

  5. What Will Be Presented Today  Presentation Overview  Status of Recommendations from April 2015 P&F Committee Meeting  Review Budget Process • Proposed Program Activities for FY17 • Resources Overview • Proposed FY17 Budget • Five Year Revenue & Expenditure Forecast • Proposed Plan to Increase Funding • State Funding Considerations • Summary of Recommendations 5

  6. Budget Development Process January - April • Staff assimilates program input & recommendations from all committees and workgroups for consideration • Management & staff meets to discuss budget framework, resources available & program considerations • Draft budgets are developed with staff input and reviewed by the management team • The management team &Comptroller, conducts group reviews • Review meetings with Committee chairman & staff conducted • The draft budget is submitted to the Program & Finance Committee for consideration • The Program & Finance Committee meets with staff to review the proposed budget and provide input • The Program & Finance Committee recommends the budget for adoption by the Commission 6

  7. What Will Be Presented Today  Presentation Overview  Status of Recommendations from April 2015 P&F Committee Meeting  Review Budget Process  Proposed Program Activities for FY17 • Resources Overview • Proposed FY17 Budget • Five Year Revenue & Expenditure Forecast • Proposed Plan to Increase Funding • State Funding Considerations • Summary of Recommendations 7

  8. Program Categories  Administrative Programs  Monitoring & Assessment Programs  Source Water Protection Program 8

  9. Administrative & Public Information Programs  Facilities  Program Development  Administrative Support  Community Relations  Committee Activities  Public Information 9

  10. Proposed Administrative Programs Changes Impacting Budget  Pension contribution increase - $38,570  Include full mortgage payment - $37,955  Truck purchase - $35,000  Policy review legal fees - $20,000  Financial internal controls audit - $10,000  Increased legal retainer - $6,000 10

  11. Pension Plan Review 11

  12. Pension Committee Recommendation • ORSANCO budgets 7/1/2015 actuarially recommended funding level of $338,570 • Do not amend plan to add employee contributions • Do not amend plan to halt new entrants at this time • Continue to closely monitor future Pension Plan Valuation Status and ORSANCO’s financial status to determine recommended future course of action 12

  13. Pension Plan Status • Review completed by Pension Committee • Plan restated to comply with IRS Regulations • July 1, 2015 Actuarial Report Completed • Unfunded Past Service Liability of $1,939,738 • Actuarial recommended funding of $338,570 13

  14. ORSANCO PENSION VALUATION DATA JULY 1, 2015 Valuation Total Accrued Market Unfunded Funded Actuarially Actual Date Accrued Past Value Liability Ratio Recommended Annual Liability* Service Of Assets (1) – (3) (3) / (2) Funding Contribution (1) Benefits** (3) Contribution*** (2) July 1, 2015 5,552,548 4,862,864 3,612,810 1,939,738 74.3% 338,570 300,000 July 1, 2014 5,072,990 4,398,112 3,479,075 1,593,915 79.1% 295,766 300,000 July 1, 2013 5,171,720 4,414,745 3,085,633 2,086,087 69.9% 378,326 250,000 July 1, 2012 4,904,728 4,188,288 2,799,625 2,105,103 66.8% 377,391 250,000 July 1, 2011 4,182,248 3,419,044 2,676,083 1,506,165 78.3% 316,009 200,000 *Includes future projections of salaries for current employees to an assumed retirement date as well as past service liability. ** Value of past service accrued benefits as of the actuarial report date. ***Actuarially calculated recommendation - Includes normal annual cost and 10-year amortization of unfunded past service liability. 14

  15. Pension Plan Overview • 15 inactive (10 retirees & 5 past employees with vested pension status) and 18 active participants • The plan requires 5 years of service to be vested • ORANCO’s 5 -Yr funded status ranged from 66.8% to 79.1% • ORSANCO member state plans funded status between 39% and 89% (2013 data) • ORSANCO’s plan assumes discount rate of 7.6% for valuation • ORSANCO uses 10 years to amortize its unfunded liability • States use 20 to 30 years to amortize their unfunded liability • ORSANCO’s total pension funding since 2001 has been $1,502,584 less than the actuarial recommended total funding 15

  16. Pension Plan Review • Committee looked at adding employee contributions – IRS would require additional benefit equal to employee contribution – Additional risk to ORSANCO because future actuarial shortfalls associated with new benefit would be ORSANCO’s responsibility • Committee looked at halting new entrants into plan – Would cost legal fees to amend plan – Does not provide short term relief • Committee looked at impact of suspending current plan – Would reduce July 1, 2015 unfunded liability from $1,939,738 to approximately $1,300,000 – Would reduce actuarial funding level from $338,570 to approximately $170,000 annually – Would likely be replaced with 457 type defined contribution plan costing approximately $60,000 per year assuming 5% match 16

  17. Pension Committee Recommendation • ORSANCO budgets 7/1/2015 actuarially recommended funding level of $338,570 • Do not amend plan to add employee contributions • Do not amend plan to halt new entrants at this time • Continue to closely monitor future Pension Plan Valuation Status and ORSANCO’s financial status to determine recommended future course of action 17

  18. Vehicle Fleet Status Vehicle Mileage 2002 F350 Dually* 104,349 Mileage & Years of Towing Large Boat & Aquarium 2003 E450 Lab 117,757 2006 F250** 147,417 Mileage & Maintenance History 2006 GMC Dually 123,259 2008 F250*** 126,253 Mileage By Replacement Date 2008 F350 Dually 47,258 2012 F250 53,604 2013 F250 38,139 *FY17 Proposed Replacement Schedule ** FY18 Proposed Replacement Schedule *** FY20 Proposed Replacement Schedule 18

  19. Administrative Programs (Indirect Cost Breakdown) Committee Community Activities, $44,465 Relations, $50,504 Facilities, $138,552 Facilities Program Development Program Development, Support Activities $232,022 Community Relations Committee Activities Support Activities, $696,187 Total Proposed Indirect Cost - $1,161,730 Proposed FY17 Indirect Cost Rate – 145.38% 19

  20. Public Information Programs 20

  21. Activity Overview • Public Presentations • Write Annual Report • Manage Sweep Program • Coordinate Media Relations • Develop Press Releases • Collaborate with State Agency PI Staffs • Manage Website Content • Manage Social Media • Produce Newsletters & Informational Publications • Oversee Volunteer Monitoring Activities • Manage Distribution Lists • Etc. 21

  22. Programs Overview 106 Supported • Public Information (114) - $113,689 State Supported • Public Awareness (118) - $43,644 • Volunteer Monitoring (117) $20,358 Self Funded • Ohio River Sweep (370) - $110,862 • No proposed increased program activity for FY17 22

  23. Monitoring and Assessment Programs 23

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