Title
Discussion of Potential Changes to the Management of Profit Transfers from the Joint Utility System Fund to the General Fund.
Body
At the March 19, 2019 County Council meeting the "Transfer of Revenues from Electric and Gas Funds to the General Fund" was discussed and approved. Because this annual process is driven by County Charter, Ordinance and Resolution, this item was passed for 2019. However, Council had ongoing questions regarding this practice and agreed to consider options and alternatives for future years.
Staff from the County Attorney's office, the Department of Public Utilities (DPU), the County Manager's office, the Finance Division and Council Leadership discussed, collaborated and developed a new proposed path forward for managing these transfers differently in the future. This initial draft proposal has been shared with the Utility Board Chair, the Joint Council / BPU policy subcommittee, and the entire Board of Public Utilities (BPU). To date the feedback is positive.
Overview and Summary of Proposal
The primary drivers of the proposed changes are to:
1. Assure consistency with word and Intent of Charter (get "back to basics"), this includes:
a. Being sure that LAC Charter, Sections, 504,506, and 509 are being met;
b. Specifically, assure that items 1-5 of Section 509 are being met and that both near-term and long-term utility infrastructure requirements and expenses are being planned and budgeted appropriately.
i. In the past, mechanisms and timing for gas and electric purchase did result in potential yearly profits (or losses) but these mechanisms have been replaced with more real-time purchasing approaches.
c. Specifically, for Section 509 item 4, appropriately set franchise fees that would normally be assessed against privately owned gas and electric utilities.
i. These ...
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