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Financial Update

Fiscal Year 2021 wrap-up

Zone 7’s overall financial outlook remains positive with net increases in assets due to major investments in infrastructure. Additionally, our financial team continues to win awards for outstanding work in transparency and reporting, maintaining the highest commitment to responsible fiscal management

Significant Achievements in Responsible Fiscal Management

Excellence in Financial Reporting

Zone 7 earned a Government Finance Officers Association (GFOA) Certificate of Achievement for Excellence in Financial Reporting for its FY 2019-20 Annual Comprehensive Financial Report. 

Planning for future pension needs

On February 17, 2021, the Board authorized the establishment of an IRS Section 115 Trust to help prefund future pension liabilities. The IRS Section 115 Trust will address long-term pension liabilities by prefunding future pension payments.

Continued AA+ Bond Rating

On June 24, 2021, Fitch Rating affirmed the Livermore Valley Water Financing Authority, Water Revenue Bonds, 2018 Series A rating of ‘AA+’.  

Clean external audit

For FY 2021, the Agency’s external auditors expressed an unmodified “clean” opinion that the Agency’s financial statements are fairly stated in conformity with accounting principles generally accepted in the United States.

FY 2021 Financial Highlights

Net Position $554.5m
+$18.5 million (+3.5%) ⬆

Net position increased by $18.5 million or 3.5% from $536 million to $554.5 million.

Total Revenue $118.4m
-$11.4 million (-8.8%) ⬇

$118.4M Agency-wide Audited Actual Revenue FY 2021

83% Charges for Services
8% Property Taxes
 6% Grants + other contributions
2% Investment Earnings
 < 1% Other
 < 1% Capital grants + contributions

Total revenues decreased by $11.4 million or 8.8% from $129.8 million to $118.4 million mainly due to a decrease in charges for services of $6.5 million from the previous year.  Construction and development activities in the service area have slowed due to the COVID-19 pandemic. However, the decrease in charges for services was offset by an increase in water sales and an increase in property tax revenue. 

Total Expenses $99.8m
+$3.6 million (+3.7%) ⬆

$99.8M Agency-wide Audited Actual Expenses FY 2021

67% Water Enterprise Operations
23% State Water Project
9% Flood Protection Operations
< 1% Flood Protection Grants
< 1% Flood Protection Development Impact Fee

Total expenses increased by $3.6 million or 3.7% from $96.2 million to $99.8 million mainly due to an increase of $5.4 million for the Water Enterprise projects during the fiscal year. The increase was offset by a $1.2 million decrease in the State Water Project pass-through payments to the California State Department of Water Resources (DWR) and a $0.6 million decrease in Flood Protection projects during the fiscal year. 

Capital Assets $330.1m
+$30.1 million (+10%) ⬆

Capital assets increased by $30.1 million or 10% from $300 million to $330.1 million mainly due to the construction of the Del Valle Water Treatment Ozone Plant and construction in progress of the Patterson Pass Water Treatment Plant ozone and upgrade projects.

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