The COVID-19 pandemic has not greatly affected the Albemarle County Service Authority’s budget, staff said Thursday.
At the service authority’s Board of Directors meeting, ACSA staff presented the high-level, operational overview of the year end results for fiscal year 2020, which ended June 30.
ACSA ended the year with operating revenues 2.6% over what was budgeted and spent about 5.8% less, resulting in a $2.4 million surplus.
“Typically, what we do is we will roll that money over to try to help reduce future rates,” said ACSA Executive Director Gary O’Connell in an interview. Earlier this year, the authority approved rates with no increase for the current fiscal year.
Quin Lunsford, ACSA’s director of finance, said that overall, the service authority is in a really good financial position.
“The pandemic is not impacting our budgeted expectations greatly one way or another, and we’re essentially on pace with where we were last year at the same time,” he said.
Due to the current good financial position and future consumption projections, the board also approved an appropriation of $336,000, which includes a partial year funding for a new IT position, a COVID-19 pandemic bonus for employees, and a base pay increase for employees.
O’Connell said the raises will increase the budget about 3.6%, which represents a pool of money that will be spread among employees based on their salaries. The bonuses average out to about $1,300 per employee, but will be different for individual employees.
With the moratorium on utility disconnections lifted, O’Connell said the service authority has still not disconnected any customers.
“We’re thinking we’ll keep that stance at least for the next couple months, through the holidays and into early 2021,” he said.
About 300 customers are behind in their bills, which O’Connell said is about 1.5% of ACSA’s total customer base. The board approved a customer recovery payment plan program earlier this year that spreads payments over 12 months with no interest and no special fees.
In letters to customers behind in their payments, the service authority is also referring them to Albemarle County’s emergency financial assistance.
“We feel like we’ve had pretty good experience working with our customers individually to try to adapt to their own economic situation, and then coming up with some kind of plan to help them make a repayment,” he said. “So we’re hopeful that most people will be able to do that and we can avoid disconnections entirely.”
Lunsford told the board that the pandemic did affect some of the authority’s expected consumption overall in May in June, when it saw a reduction of 5.4% and 3.8%, respectively.
During April, May and June, non-residential total water sales decreased, while residential increased considerably, Lunsford said and showed on graphs. During a normal year, non-residential consumption is about 31% of the authority’s total water sales on average, while residential consumption is about 69%.
“The increase we saw for our residential customers kind of negated the decreases we saw on the non-residential side,” Lunsford said. “End of the day, we’re seeing essentially the same total consumption, it’s just coming from a different customer class.”
Operational expenses for fiscal year 2020 were reduced due to vacant positions that were unable to be filled, as well as certain maintenance and other tasks that weren’t able to be performed and affected the way ACSA operated.
At next month’s meeting, the board will receive the full financial report for the fiscal year, along with the audit report.
The first quarter of fiscal year 2021 looks similar, Lunsford said, and the authority’s operating revenues are 14% over budgeted expectations, but that does not include the seasonal expectations of selling more water in the late summer and fall than the winter months.
The authority is about 3.7% under budget for operating expenses, but is about 7.3% over budget for the purchase of water from the Rivanna Water and Sewer Authority. Charlottesville and the ACSA have an agreement with Rivanna, and costs are allocated to the city and the service authority based on what was consumed.
“The city showed major reductions in the quarter for the allocation calculation, so we’re seeing the impacts of that,” Lunsford said. “That quarterly allocation will be updated beginning with the October billing from Rivanna, so we do expect to see that they come back down some, but that is what’s driving that increase in the variance there.”
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