Merced Irrigation District's board of directors on Tuesday passed its pared-down $70 million 2010 budget and announced a tentative start to the irrigation season for March 29.
"The budget is passed, the party starts in five minutes," board chair Wil Hunter joked after the vote.
The projected budget, about $6.5 million less than 2009's, will leave the district with a cash-flow surplus of $2.6 million. It also reflects some of the changed priorities of the new leadership on the board.
"I think this new budget reflects the different position of our board," said Hunter. Holding costs down and the reorganization have lowered the district's operating costs. That may enable it to keep fees where they are, said Hunter.
Even the budget process itself was changed from 2009's tortured effort. The budget went "much smoother" this year, said director Suzy Hultgren, who had criticized staff for failing to explain the process and for their lack of transparency in 2009.
Andre Urquidez, the district's director of finance, said the most obvious change to this year's budget was the $1.3 million in savings from the district's reorganization of staff and a step-increase freeze of $130,345.
The district's $15.6 million total in salaries and benefits for 2010 was down almost $1 million from 2008.
Aside from those changes, there's a 2 percent increase projected on the electrical side even though the largest chunk of its revenue was lost locally because of the economic downturn, said Hunter.
The district also saw a 15 percent drop in local tax revenues in the new budget, which will cut the funds the district brings in from property taxes.
The district's three operations -- water, electrical and parks -- which comprise the district's activities, were separated in the budget even though their funds aren't restricted.
The water operations revenue for 2010 is calculated in the budget as $17.6 million. The budget predicts $14.6 million in spending, with a surplus just under $1 million.
The largest chunk of the district's budget, electricity, was budgeted at $52.9 million for 2010. The district's budget forecasts $50.2 million in spending on the electrical side, with a surplus of $2.2 million. The bulk of the electric revenue -- $50 million -- will come from sales. The bulk of spending -- $33 million -- will come from buying power, according to the budget.
The district's budget also painted less than bright picture for the parks division, which will bring in $1.5 million in revenue in 2010. By the end of the year the parks will have a total deficit of $452,890.
The district's budget will also spend $185,113 on information technology.
The last budget item, Federal Energy Regulatory Commission spending, will cost the district nearly $6 million for everything from scientific studies to legal consultation. The district's license to operate its hydroelectric project on Merced River expires in 2014. In the meantime, the district is rushing to complete the requirements for the project's relicensing.
"This is the big year for FERC reclining spending," said Geoff Rabone, director of regulatory compliance and governmental affairs.
The money for the FERC relicensing came from an $18 million bond issued for the project.
John Sweigard, the district's general manager, said by the end of 2010 the district's debt is projected to be $121 million. The district's annual debt service is now $7.6 million.
At the same time, its consolidated cash reserves for 2010, not including unspent bond money, will be $26.6 million.
Reporter Jonah Owen Lamb can be reached at (209) 385-2484 or jlamb@mercedsun-star.com.
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