Annual Report 2023
Annual Report 2023




Excellence in Financial Reporting for
FY 2021-2022

The Agency earned a Government Finance Officers Association Certificate of Achievement for Excellence in Financial Reporting for its FY 2021-22 Annual Comprehensive Financial Report, a recognition of the Agency’s commitment to responsible fiscal management, transparency, and public accountability.

Water Rates

On November 16, 2022, the Board approved 5.5% annual rate revenue adjustments for wholesale water services for Calendar Years (CY) 2023, 2024, 2025 and 2026. The CY 2023 increase went into effect February 1, 2023. The remaining increases will be effective January 1, 2024-2026. The Board will revisit the rate schedule for calendar years 2025 and 2026, through a public process, with any changed rates adopted by November 2024.


The approved rate increases are essential to construct, maintain, and repair the crucial infrastructure that keeps customers’ water safe and consistently flowing to homes and businesses.

Sustainable Groundwater Management Grant

As part of our responsible fiscal management strategy, the team applied for federal funding to offset local costs for development of the Stoneridge Well Ion Exchange (IX) PFAS Treatment facility. On September 12, 2023, DWR announced Zone 7 will receive a $16 million award!


Million grant

from the California Department of Water Resources’ Sustainable Groundwater Management Grant Program


of our drinking supply

will be brought back online with this project, the first facility to offer IX PFAS removal in Northern California

Series A

Water Revenues Bond

S&P Global Ratings (S&P) raised its long-term rating on the Agency's outstanding bonds, and provided its highest rating to our newly issued bonds, both with stable outlook.

2018 Outstanding Bonds Upgraded

Arrow with text 'outlook:stable'

2023 Bond Issuance Rating

Arrow with text 'outlook:stable'

Fitch Ratings also upgraded the

Agency's Outlook

AA+ Stable
AA+ Positive

The exceptional ratings led to a successful bond sale on October 24, 2023, which will be used to fund the Chain of Lakes PFAS Treatment Facility and other planned capital improvement projects.



in bond proceeds received


true interest cost


financing on bonds

FY 2023-24 Mid-Cycle Budget Amendment

On October 18, 2023, the Board adopted the FY 2023-24 Mid-Cycle Operating and Capital Budget Amendment. The mid-cycle budget review is completed every other year to confirm the two-year budget is still aligned with the Board’s strategic planning priorities, economic and climate conditions, capital project plans, adopted salary schedules, adopted rates and fees, and reserve policy requirements.

Fiscal Year Highlights

Net Position $586m

+$19 million (+3.4%)

Net position increased by $19 million or 3.4% from $567 million to $586 million

Total Revenue $125.8m

+$5.7 million (+4.8%)

$125.8 million in agency-wide actual audited revenue during FY 2023

Total Revenues by Category

  • \Charges for Services
  • \Property Taxes
  • \Grants + other contributions
  • \Investment earnings and others (loss)
  • \Capital grants + other contributions

Total revenues increased by $5.7 million or 4.8 percent to $125.8 million from $120.1 million in the prior year.  The increase is mainly due to a $4.8 million increase in investment earnings from the previous year as a result of favorable market conditions, a $3 million increase in grants and other contributions from DWR refunds of our State Water Project pass-through payments, and a $0.9 million increase in property tax due to increased property assessed valuations. These increases were offset by a decrease in charges for services as connection and development fees decreased $2.6 million due to slower construction and development activities in the service area.

Total Expenses $106.8m

-$0.9 million (-0.8%)

$106.8 million in agency-wide actual audited expenses during FY 2023

Total Expenses by Category

  • \Water Enterprise
  • \State Water Project
  • \Flood Protection Operations
  • \Flood Protection Grants
  • \Flood Protection Development Impact Fee

Total expenses decreased by $0.9 million or 0.8 percent from $107.7 million to $106.8 million mainly due to a $6.6 million decrease in Water Enterprise water purchases and water storage as the state of drought emergency declared by the Board ended in 2023. Flood Protection Operations projects decreased $3.5 million as maintenance repair program activities were completed or substantially completed in fiscal year 2023 along with a deferral of flood repair projects to fiscal year 2024. This decrease was offset by a $4.5 million increase in employee salaries and benefits due to a cost-of-living adjustment, effective June 2022, a $1.4 million increase in State Water Project pass-through payments to DWR, a $1.2 million increase in other services and supplies for funding contributions to the Los Vaqueros Reservoir Expansion Project, and a $1.1 million increase in capital asset depreciation due to the capitalization of large construction projects in recent years.  

Capital Assets $364m

+$7.9 million (+2.2%)

Capital assets increased by $7.9 million, or 2.2 percent, from $356.1 million to $364 million. The increase is mainly due to the construction of the Patterson Pass Water Treatment Plant ozone and upgrade projects as the Agency used the 2018 Water Revenue Bonds in the acquisition fund.

Zone 7 Water Agency – Annual Report 2023

Zone 7 Water Agency – Annual Report 2023