Budget season is never easy; especially for an organization like the Turlock Irrigation District, which provides electric service to over 99,000 customers and irrigation water to 4,900 area farmers in Ceres and elsewhere. But after three months of reviewing reports from each TID department, a final budget was passed on Tuesday. The outcome? A brighter outlook for 2014 than originally expected.
In the Oct. 29 TID Board of Directors meeting, the proposed 2014 financial forecast included a $13 million transfer from the rate stabilization fund to help cover the district's increases in costs associated with wage raises, pension costs and medical expenses for employees. In the Dec.10 meeting, however, Malaski said that TID is hoping to not have to make this transfer after all.
"At first we had a stabilization transfer projected at $13 million, which we have now reduced that to be down to $4 million," said Malaski. "It is my expectation, or at least it is my hope, that we don't have to make those transfers at all."
Although there are several challenges facing the 2014 budget, including labor negotiations, property and general liability insurance, bad debts, audit fees, and increased wages and medical expenses, Malaski remained hopeful that TID would continue to be conservative with their budget, not spending more than what is needed.
"The other thing that will occur - and that has occurred in our departments over the years - is when we target a budget every year, we don't spend every dollar," said Malaski. "We have an expectation when we deduce the budget, but we don't feel the need to spend it. If the situation changes and we don't need to spend it, then we don't spend it...We're hopeful that we're going to be able to make it through 2014 without the transfer at all."
Despite the possibility of the $4 million rate stabilization transfer, the 2014 budget continues to be considerably lower than previous years.
"Our capital budget for this coming year is down to $44 million," continued Malaski. "That is down significantly lower than the budget that we've had in recent times. If you recall this time two years back, we were in the $180 millions, close to $190 million. We've wrapped up a lot of those generation projects, and now we've gotten much closer to a much more steady state capitol budget."
While the 2014 budget has no embedded electric rate increases, customers can expect an increase of four percent coming as a result of TID reducing the discount provided by the environmental charge on utility bills. According to Malaski, this is the only change in electric rates, and will take effect Jan. 1.
Recently appointed Board President Ron Macedo offered his gratitude to TID staff for their hard work poured into preparing the 2014 budget.
"Budgets are certainly never an easy thing," said Macedo. "But I think TID did a fine job doing it...I appreciate everything you guys do, and let's try to make 2014 a great year."
The next three weeks of TID Board of Directors meetings have been cancelled due to the holidays, with the next meeting being held at 9 a.m. on Jan. 7 at the TID Main Office Building, located at 333 E. Canal Drive.