We are pleased to present the final budget of Public Utility District Number 1 of Clallam County for the fiscal year beginning January 1, 2024, and ending December 31, 2024. This is budget serves as a financial plan that guides the spending of the District for the upcoming 12 months of operation.
For the final budget book, we incorporated Board feedback by including year-over-year budget comparison figures. We hope this additional information adds context and meaning to the current budget.
The 2024 budget process was unique in that the results of a cost-of-service study for the Electric Division were presented during the same time frame as the budget. Multiple scenarios were considered over several meetings as the Board worked with District staff and rate consultants to determine an optimal path forward. On October 23, 2023, the Board approved a single-year rate increase of 3.5% for the Electric Division. The rate increase necessitated budget reductions to offset forecasted cash shortfalls. These budget reductions were accomplished through a combination of personnel deferments, capital deferments, and operations and maintenance expense cuts. Operations and maintenance expense cuts are included in the Department Detail section and labeled “Reduction Targets.” The personnel and capital deferments are listed below:
Personnel
- Substation Apprentice position
Capital
- Audio equipment
- Pallet racking and fans for Central Warehouse Facility
- Dissolved gas analyzer
Earlier this year, cost-of-service studies for both the Water and Wastewater Divisions were completed and presented to the Board. On July 31, 2023, the Board voted and passed resolutions establishing rate schedules for the Water and Wastewater Divisions.
Highlights of the 2024 budget are outlined below:
- Electric: Rate adjustment 3.5%, effective date 4/1/2024.
- Water: Rate adjustment 4.75%, effective date 4/1/2024.
- Wastewater: Rate adjustment 9%, effective date 4/1/2024.
- Purchased Power increased by $7.56M due to the discontinuation of Bonneville Power Administration’s Reserves Distribution Clause (for power) and nominal load increases.
- Personnel increased $2.99M due primarily to 2023 to 2026 Collective Bargaining Agreement increases and inflationary-driven increases for non-represented personnel.
- To address the ongoing challenges caused by supply chain disruptions, the District has proactively worked to boost inventory levels for key materials and continues to explore new products and manufacturers to mitigate escalating prices.
- Capital increased $2.83M for the combined utility, excluding personnel.
The District strives to operate in a fiscally responsible and sustainable manner while also investing in its infrastructure in order to provide both reliable and low-cost services. We believe the 2024 budget reflects those goals.
We look forward to a successful year of operations with the ongoing support and oversight of the Board of Commissioners. We encourage any questions and discussion.
Respectfully,
Sean Worthington
General Manager
Ruth Kuch
Finance Manager/Treasurer