Senior Management Staff - Gaffney Board of Public Works

Transcription

I. INTRODUCTORY SECTION
Board of Public Works
Gaffney, South Carolina
Comprehensive Annual Financial Report
For the Fiscal Year Ending March 31, 2013
Submitted By:
Finance Department
i
GAFFNEY BOARD OF PUBLIC WORKS
COMPREHENSIVE ANNUAL FINANCIAL REPORT
FOR THE YEARS ENDED MARCH 31, 2013 AND 2012
TABLE OF CONTENTS
Page
I.
II.
Introductory Section
Title Page
Table of Contents
List of Commissioners and Senior Management Staff
Organizational Chart
Letter of Transmittal
Certificate of Achievement for Excellence in Financial Reporting
Financial Section
Independent Auditors’ Report
Management’s Discussion and Analysis
i
ii-iii
iv
v
vi-ix
x
Exhibit
Basic Financial Statements
Statements of Net Position
Statements of Revenues, Expenses and
Changes in Net Position
Statements of Cash Flows
Notes to Financial Statements
A
11-12
B
C
13
14-16
17-29
Required Supplementary Information
Schedule of Funding Progress for Retiree Health Plan
Supplementary Information
Schedules of Water Department Operations
Schedules of Sewer Department Operations
Schedules of Electrical Department Operations
Schedules of Warehouse and Administrative Expenses
III. Statistical Section
Financial Trends
Net Position by Component
Revenues by Source
Electric Department Operating Expenses
Water Department Operating Expenses
Sewer Department Operating Expenses
Warehouse & Administrative Expenses
Revenue Capacity
Annual Billed Electric Usage
Annual Billed Water Usage
Annual Billed Sewer Usage
Historical Average Residential Electric Rate
Historical Average Residential Water Rate
Historical Average Residential Sewer Rate
ii
Page
1-2
3-10
31
Schedule
1
2
3
4
Page
33
34
35
36
Table
Page
1
2
3
4
5
6
7
38
39
40
41
42
43
44
8
9
10
11
12
13
45
46
47
48
49
50
COMPREHENSIVE ANNUAL FINANCIAL REPORT
TABLE OF CONTENTS - CONTINUED
III. Statistical Section - Continued
Revenue Capacity - Continued
Number of Electric Customers by Customer Category
Number of Water Customers by Customer Category
Number of Sewer Customers by Customer Category
Ten Largest Electric Customers
Ten Largest Water Customers
Ten Largest Sewer Customers
Table
Page
14
15
16
17
18
19
51
52
53
54
55
56
Debt Capacity
Debt Outstanding
Historical Statements of Revenues, Expenses, Debt Service and
Debt Service Coverage
20
57
21
58
Demographic and Economic Information
Cherokee County Demographic & Economic Statistics
Cherokee County, Major Employers
22
23
59
60
Operating Information
Schedule of User Charges
Number of Employees
Operating and Capital Indicators
24
25
26
61-65
66
67
iii
Board of Public Works Officials
List of Commissioners
And Senior Management Staff
Commissioners
Elijah Inabinette, Jr . . . . . . . . . . . . . . . . . Chairperson
Roger D. Harris . . . . . . . . . . . . . . . . . . . . Secretary
James H. Kelly . . . . . . . . . . . . . . . . . . . . . Treasurer
E. DeWitt McCraw . . . . . . . . . . . . . . . . . . Commissioner
J. Grady Randolph . . . . . . . . . . . . . . . . . . Commissioner
Senior Management Staff
Donnie L. Hardin. . . . . . . . . . . . . . . . . . General Manager
Kimberly R. Fortner. . . . . . . . . . . . . . . Assistant Manager
iv
Organizational Chart
Board Members
Elijah Inabinette, Jr.
Chairman
Roger D. Harris
Secretary
James H. Kelly
Treasurer
J. Grady Randolph
Commissioner
E. DeWitt McCraw
Commissioner
Management Staff
Donnie L. Hardin
General Manager
Kimberly R. Fortner
Assistant Manager
v
BOARD OF PUBLIC WORKS
210 East Frederick Street, Post Office Box 64
Gaffney, South Carolina 29342
(864) 488-8800
Facsimile (864) 488-8855
Letter of Transmittal
July 29, 2013
To the Commissioners and Customers
of the Gaffney Board of Public Works
We are pleased to submit to you the Comprehensive Annual Financial Report (CAFR) for the
Gaffney Board of Public Works (the Board) for the fiscal year ended March 31, 2013. Responsibility
for both the accuracy of the data and the completeness and fairness of the presentation, including all
disclosures, rests with the Board’s management. To the best of our knowledge and belief, the
enclosed data is accurate in all material respects and is reported in a manner designed to present
fairly the financial position and results of operations of the Board. All disclosures necessary to
enable the reader to gain an understanding of the Board’s financial activities have been included.
Board management has established a system of internal accounting controls designed to provide
reasonable, but not absolute, assurance for the safeguarding of assets and financial statement
preparation in conformity with generally accepted accounting principles. The concept of reasonable
assurance recognizes that the cost of internal controls should not exceed the benefits.
The Board is required by state law to publish an annual financial report audited by a certified public
accountant and this CAFR fulfills that requirement. McAbee, Talbert, Halliday & Co., Certified
Public Accountants, conducted the independent audit of the Board’s financial statements. The
objective was to obtain reasonable assurance that the financial statements are free of material
misstatement. The audit was conducted in accordance with generally accepted auditing standards.
McAbee, Talbert, Halliday & Co. issued an unqualified opinion that the Board’s financial statements
are fairly presented, in all material respects, in conformity with generally accepted accounting
principles. The Independent Auditors’ Report is presented as the first component of the financial
section of this report.
A Management Discussion and Analysis (MD&A) is provided in the financial section of this report.
The MD&A serves as a narrative introduction, overview and analysis of the District’s financial
statements. This Letter of Transmittal is intended to compliment the MD&A and should be read in
conjunction with it.
vi
PROFILE OF THE BOARD
The Board was originally established by Act No. 389 of 1907 to provide electric, water, and
wastewater distribution and treatment services. The Board serves the City of Gaffney and
surrounding areas of Cherokee County.
The Board is located in Cherokee County, which is located in the piedmont section of South
Carolina on the I-85 corridor between Atlanta, Georgia and Charlotte, North Carolina. The
current boundaries of the Board encompass 32,009 acres (50 square miles), not including the
Town of Blacksburg or water districts which are provided water as wholesale customers. The
Board provides water on a wholesale basis to the Town of Blacksburg, Draytonville Water
Company, Grassy Pond Water Company, Goucher Water Company, and Macedonia Water
Company. Daniel Morgan Water Company is also served water through Grassy Pond Water
Company.
The Board is governed by a five member Commission, all of whom are elected from single
member districts within the city limits of Gaffney. Each Commissioner serves six year terms and
the terms of Commissioners are staggered.
The Board presently operates two water treatment plants and two wastewater treatment plants.
The Victor Gaffney and Cherokee water treatment plants are located on the same parcel of land
at the end of Filter Plant Road. The Broad River wastewater treatment plant is located off
Marietta Street and serves the eastern and southern portions of Cherokee County. The Clary
wastewater treatment plant is located off Morgan Road and serves the western and northern
portions of Cherokee County.
The Board provides reliable electric service to Gaffney and surrounding areas of Cherokee
County. Power is supplied by Piedmont Municipal Power Agency (PMPA), a joint action
agency, of which Gaffney and nine (9) other upstate cities are members. PMPA owns 25% of
Unit One at the Catawba Nuclear Plant in York, South Carolina. The Board has long term
wholesale contracts with PMPA. The Board also receives some power from Southeastern Power
Administration (SEPA). SEPA is a federally owned project of which utilities have contracts to
receive energy produced by federally owned hydro projects. SEPA power is transmitted to the
Board by PMPA.
LOCAL ECONOMY
Cherokee County possesses a diversified business and industry base. The following types of
industry represent major employers in Cherokee County: frozen food, roller bearings, automotive
chassis, fiberglass recreational bodies, textiles, brick and concrete materials, plastic packaging
material, plumbing fixtures, plastic and synthetic fibers, and structural building products. The
county has an available, skilled labor force and has taken advantage of the State’s excellent
worker training program. Other major employers in the area include public schools, state and
local government, and health care providers.
Cherokee County’s unemployment rate in March 2013 was 10.3%, as compared with the state
rate of 8.4% and the national rate of 7.6%. While the unemployment rate in Cherokee County
outpaced the State or National rate overall the County continued to see commercial development.
vii
FINANCIAL MANAGEMENT
The Board adopts an annual operating budget for management and financial planning purposes.
The Board’s computerized financial planning and rate-setting model is regularly updated to
provide for a five-year financial plan. Capital improvement plans, and applicable debt service
projections for future bond issues, are incorporated in the financial planning process. The fiveyear plan is reviewed with the Commission, which adopts the budget and rates for each
upcoming year. The overall objective of the financial planning process is to minimize the impact
of customer rate increases, while maintaining required debt service coverage. Other
considerations of the financial planning process include: volume trends by customer class;
maintaining sufficient fund balances to meet the Board’s operations, maintenance, and capital
improvement needs; growth trends for various expenditure categories; and the comparison of
customer rates to other utilities in the region. During the fiscal year, financial management
tracking includes the following: monthly preparation and analytical review of departmental and
company-wide financial reports; significant expenditure variances require follow-up with the
responsible budget manager; the company-wide financial report is presented at the monthly
Commission meeting; utility user charges are monitored monthly in relation to the approved
budget and historical results; the tracking of utility user charges is performed for revenues and
flows by customer class.
The Board of Public Works has a long range plan that guides the Board and staff actions toward
providing affordable, efficient, and reliable services. Part of that plan includes continued capital
investments. In order to be able to respond to system growth and provide dependable service,
the plants and facilities must be maintained and expanded. This requires not only response to
changing regulatory requirements and community development but financial planning to
accommodate the required investments in timely, fiscally responsible manner. One strategy the
Board has implemented is the allotment of $2 million in the annual budget for capital
improvements per department (electric, water and wastewater). With an ongoing long range plan
to meet the physical demands of the facilities and an ongoing financial plan to provide funding
for these improvements the Board will continue to strengthen its customer relations and services.
The Board’s cash management policy provides that available funds are invested overnight and
longer-term in accordance with state law, which permits the following types of investments:
obligations of the U.S. and its agencies, general obligations of the State of South Carolina and its
subdivisions, savings and loan associations to the extent of federal insurance, certificates of
deposit collaterally secured, repurchase agreements secured by the foregoing obligations, and the
State Treasurer’s Investment Pool. For more information regarding the March 31, 2013
investment distribution, see Note 2 to the Financial Statements.
The Board is a member of the South Carolina Retirement System, one of four defined benefit
retirement systems maintained by the Retirement Division of the State Budget and Control Board
of South Carolina. For information regarding the Board’s retirement plan, see Note 6 to the
Financial Statements.
For information regarding the Board’s risk management function, see Note 10 to the Financial
Statements.
viii
ix
x
II. FINANCIAL SECTION
To the Board of Commissioners of
Gaffney Board of Public Works
Gaffney, South Carolina
INDEPENDENT AUDITORS’ REPORT
We have audited the accompanying financial statements of the Gaffney Board of Public Works as of and for
the years ended March 31, 2013 and 2012, and the related notes to the financial statements, which
collectively comprise the Gaffney Board of Public Works’ basic financial statements as listed in the table of
contents.
Management’s Responsibility for the Financial Statements
Management is responsible for the preparation and fair presentation of these financial statements in
accordance with accounting principles generally accepted in the United States of America; this includes
the design, implementation, and maintenance of internal control relevant to the preparation and fair
presentation of financial statements that are free from material misstatement, whether due to fraud or
error.
Auditor’s Responsibility
Our responsibility is to express an opinion on these financial statements based on our audits. We
conducted our audits in accordance with U.S. generally accepted auditing standards. Those standards
require that we plan and perform the audit to obtain reasonable assurance about whether the financial
statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in
the financial statements. The procedures selected depend on the auditor’s judgment, including the
assessment of the risks of material misstatement of the financial statements, whether due to fraud or
error. In making those risk assessments, the auditor considers internal control relevant to the entity’s
preparation and fair presentation of the financial statements in order to design audit procedures that are
appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of
the entity’s internal control. Accordingly, we express no such opinion. An audit also includes evaluating
the appropriateness of accounting policies used and the reasonableness of significant accounting
estimates made by management, as well as evaluating the overall presentation of the financial
statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for
our audit opinion.
Opinion
In our opinion, the financial statements referred to above present fairly, in all material respects, the respective
financial position of the Gaffney Board of Public Works as of March 31, 2013 and 2012, and the respective
changes in financial position and cash flows thereof for the years then ended in conformity with U.S. generally
accepted accounting principles.
1
Other Matters
Required Supplementary Information
U.S. generally accepted accounting principles require that the Management’s Discussion and Analysis and
Schedule of Funding Progress for Retiree Health Plan, as listed in the table of contents, be presented to
supplement the basic financial statements. Such information, although not a part of the basic financial
statements, is required by the Governmental Accounting Standards Board (GASB), who considers it to be an
essential part of financial reporting for placing the basic financial statements in an appropriate operational,
economic, or historical context. We have applied certain limited procedures to the required supplementary
information in accordance with U.S. generally accepted auditing standards, which consisted of inquiries of
management about the methods of preparing the information and comparing the information for consistency
with management’s responses to our inquiries, the basic financial statements, and other knowledge we
obtained during our audits of the basic financial statements. We do not express an opinion or provide any
assurance on the information because the limited procedures do not provide us with sufficient evidence to
express an opinion or provide any assurance.
Other Information
Our audits were conducted for the purpose of forming an opinion on the financial statements that collectively
comprise the Gaffney Board of Public Works’ basic financial statements. The introductory section,
supplementary information and statistical section are presented for purposes of additional analysis and are
not a required part of the basic financial statements.
The supplementary information is the responsibility of management and was derived from and relate directly
to the underlying accounting and other records used to prepare the basic financial statements. Such
information has been subjected to the auditing procedures applied in the audits of the basic financial
statements and certain additional procedures, including comparing and reconciling such information directly to
the underlying accounting and other records used to prepare the financial statements or to the basic financial
statements themselves, and other additional procedures in accordance with U.S. generally accepted auditing
standards. In our opinion, the supplementary information is fairly stated, in all material respects, in relation to
the basic financial statements as a whole.
The introductory and statistical sections have not been subjected to the auditing procedures applied in the
audits of the basic financial statements and, accordingly, we do not express an opinion or provide any
assurance on them.
Spartanburg, South Carolina
July 29, 2013
2
Management’s Discussion and Analysis (Unaudited)
This section represents management’s analysis of the Board’s financial condition and activities
for the year. This information should be read in conjunction with the financial statements.
Financial Highlights
Management believes the Board’s financial condition is very strong. During FY 2013 revenues
and operating expenses have increased. Uncontrollable expenses such as purchased power and
fuel have been the major factors contributing to the increase in expenses. Despite the increases
in expenses, the Board has continued to be able to improve service, provide for future growth,
and maintain a very stable and competitive rate structure. Also, the Board has remained well
within its debt covenants, with stringent financial policies and guidelines set by the Board and
management. The following are key financial highlights for FY 2013.
Total assets FY 2013 year-end were $66,173,556, and exceeded liabilities by $52,397,198.
Of the total net position, $28,749,289 was unrestricted. Total assets for FY 2012 year end
were $67,550,240 and exceeded liabilities by $53,194,701. Of the total net position,
$27,522,633 was unrestricted.
Debt service coverage was 292% in FY 2013 and 248% in FY 2012; both years exceeded the
120% required by the Board’s Bond covenants.
For FY 2013, the Board sold approximately 235 million kwh of electricity and 2.117 billion
gallons of potable water and treated 1.207 billion gallons of wastewater. This compares to
237.8 million kwh of electricity, 2.201 billion gallons of potable water, and 1.28 billion
gallons of wastewater in FY 2012.
Operating revenues for FY 2013 were $33,421,376 as compared to $32,279,947 for FY 2012.
Operating expenses for FY 2013 were $33,997,265 as compared to $33,454,134 for FY 2012.
Over the past several years management has implemented several measures to reduce costs
and improve efficiency in an effort to keep operating expenses down. Significant increases in
uncontrollable expenses such as purchased power and fuel have been a challenge but we have
maintained the same high levels of service our community has come to expect.
Interest income on investments decreased over the past fiscal year. Interest income for FY
2013 totaled $31,205 as compared to $70,769 for FY 2012. The decrease was due mainly to
market changes and decreased interest rates.
The Board transferred 3.05% of electric sales, the equivalent of a franchise fee to the City of
Gaffney in accordance with our Intergovernmental Agreement. The transfer for FY 2013 was
$608,344 as compared to $597,214 for FY 2012.
3
Overview of Annual Financial Report
Management’s Discussion and Analysis (MD&A) serves as an introduction to, and should be
read in conjunction with, the basic audited financial statements and supplementary information.
The MD&A represents management’s examination and analysis of the Board’s financial
condition and performance. Summary financial statement data, key financial and operational
indicators used in the Board’s strategic plan, budget, bond resolutions, and other management
tools were used for this analysis.
The financial statements report information about the Board using full accrual accounting
methods as utilized by similar business activities in the private sector. However, rate-regulated
accounting principles applicable to private sector utilities are not used by government utilities.
The financial statements include statements of net position; statements of revenues, expenses,
and changes in net position; statements of cash flows; and notes to the financial statements.
The statements of net position present the financial position of the board on a full accrual
historical basis. The statements of net position present information on all the Board’s assets and
liabilities, with the difference reported as net position. Over time, increases and decreases in the
net position are one indicator of whether the financial position of the Board is improving or
deteriorating.
While the statements of net position provide information about the nature and amount of
resources and obligations at year-end, the statements of revenues, expenses, and changes in net
position present the results of the business activities over the course of the fiscal year and
information as to how the net position changed during the year. All changes in the net position
are reported as soon as the underlying event giving rise to the change occurs, regardless of the
timing of the related cash flows. These statements also provide certain information about the
Board’s recovery of its costs. Rate setting policies are different methods of cost recovery not
fully provided for by general accepted accounting standards. The primary objectives of the rate
model are to improve equity among customer classes and to insure that capital costs are allocated
on a basis of long term capacity needs, ensuring growth pays for growth.
The statements of cash flows present changes in cash and cash equivalents, resulting from
operational, financing, and investing activities. These statements present cash receipts and cash
disbursement information, without consideration of the earnings event, when an obligation
arises, or depreciation of capital costs.
The notes to the financial statements provide required disclosures and other information that are
essential to a full understanding of material data provided in the statements. The notes present
information about the Board’s accounting policies, significant account balances and activities,
material risks, obligations, commitments, contingencies, and subsequent events, if any.
Supplementary information includes detail schedules of operations and the schedule of
expenditures of federal awards, when applicable.
The financial statements were prepared by the Board’s staff from detailed books and records of
the Board. The financial statements were audited and adjusted, if material, during the
independent audit process.
4
Financial Analysis
The following comparative condensed financial statements and other information serve as the
key financial data and indicators for management, monitoring, and planning.
Condensed Financial Statements
Condensed Statements of Net Position
Assets:
3/31/2013
Current and Other Assets
Capital Assets
Total Assets
$
34,432,566
$
31,740,990
66,173,556
3/31/2012
3/31/2011
$
32,930,483
$
32,102,694
$
34,619,757
67,550,240
$
37,581,539
69,684,233
Liabilities:
Current Liabilities
Long-Term Liabilities
$
Total Liabilities
6,282,332
7,494,026
$
5,980,093
8,375,446
$
5,997,423
9,221,867
13,776,358
14,355,539
15,219,290
23,315,909
25,340,068
27,406,721
332,000
332,000
332,000
28,749,289
52,397,198
66,173,556
27,522,633
53,194,701
67,550,240
26,726,222
54,464,943
69,684,233
Net Position:
Net Investment in Capital Assets
Restricted for Debt Service Reserve Fund
Unrestricted
Total Net Position
Total Liabilities & Net Position
$
$
$
Condensed Statements of Revenues, Expenses, and Changes in Net Position
Revenues:
3/31/2013
3/31/2012
3/31/2011
Operating Revenues
Water Department
Sewer Department
$
Electrical Department
Non-operating Revenues
Total Revenues
6,169,646
$
5,997,203
$
5,871,250
5,579,617
5,493,537
5,342,009
21,672,113
20,789,207
20,433,478
86,905
68,417
109,895
33,508,281
32,348,364
31,756,632
3,833,264
3,956,713
3,966,949
Expenses:
Operating Expenses, Excluding Depreciation
Water Department
Sewer Department
Warehouse and Administrative
Departments
Depreciation Expense
Non-operating Expenses
Total Expense
Deficiency, Before Capital Contributions
2,709,239
2,592,610
2,428,637
19,920,771
19,471,890
18,390,839
3,493,728
3,261,385
3,024,507
4,040,263
4,171,536
4,322,573
432,030
460,598
487,513
34,429,295
33,914,732
32,621,018
(921,014)
Capital Contributions
(1,566,368)
123,511
Decrease in Net Position
296,126
(797,503)
Net Position Beginning of Year
$
5
52,397,198
71,812
(1,270,242)
53,194,701
Net Position End of Year
(864,386)
(792,574)
54,464,943
$
53,194,701
55,257,517
$
54,464,943
General Trends and Significant Events
From FY 2011 to FY 2013 there has been an overall decrease in the number of electric, water
and sewer service accounts. Electric service accounts have decreased overall by 86 accounts (45
from FY 2012 to FY 2013 and 41 from FY 2011 to FY 2012) primarily in the commercial
service category. Water service accounts have decreased overall by 113 accounts (a decrease of
115 from FY 2012 to FY 2013 and an increase of 2 from FY 2011 to FY 2012) in every
customer category with the exception of Water Districts and City accounts. Wastewater
accounts have decreased overall by 73 accounts (28 from FY 2012 to FY 2013 and 45 from FY
2011 to FY 2012) primarily in the residential service category and some in the commercial
service category.
The average kwh electrical sales for FY 2013 were 1.18% less than the FY 2012 sales and FY
2012 sales were 1.94% less than the FY 2011 sales. The decreased demand occurred in the
residential and commercial customer categories and is mainly attributable to mild winters in both
years. During FY 2013 and FY 2012, the Board’s largest electric demand customer was
Suminoe and Carthuplas Incorporated, respectively.
The volume of water sold in FY 2013 was approximately 2.117 billion gallons, a decrease of
approximately 3.82% from FY 2012. During FY 2012, approximately 2.20 billion gallons of
volume water was sold, a decrease of approximately 2.91% from FY 2011. The decreases in
sales were seen in every customer category except commercial and inter-departmental. Retail
customers purchased approximately 77% and 75.9% of total water sales in FY 2013 and FY
2012, respectively. During FY 2013 and FY 2012, the Nestle Corporation was the Board’s
largest water customer, accounting for approximately 13.3% in FY 2013 and 9.09% in FY 2012
of total water sales. Wholesale water sales accounted for 19.6% and 19.7% of total water sales,
with the City of Blacksburg being the largest wholesale customer for FY 2013 and FY 2012,
respectively.
Trending with the water demands, the volume of wastewater billed in FY 2013 was 1.207 billion
gallons, a decrease of approximately 5.7% from FY 2012 compared to 1.28 billion gallons billed
in FY 2012, a decrease of approximately 2.07% from FY 2011. During FY 2013 and FY 2012,
the Nestle Corporation was the Board’s largest sewer customer.
Financial Condition
Although the Board has experienced decreases in its net position of $797,503, $1,270,242 and
$792,574 for FY 2013, FY 2012 and FY 2011, respectively, the Board’s financial condition
remains strong at year-end with adequate liquid assets, reliable facilities to meet demand, and a
reasonable level of an unrestricted net position. The current financial condition, technical
support staff capabilities, and operating and expansion plans to meet anticipated customer needs
are well balanced and under control.
Total assets for FY 2013 were $66,173,556, with a $23,315,909 net investment in capital assets,
$332,000 restricted for the debt service reserve fund and $28,749,289 unrestricted for a
$52,397,198 total net position. Total assets in FY 2012 were $67,550,240, with a $25,340,068
net investment in capital assets, $332,000 restricted for the debt service reserve fund and
$27,522,633 unrestricted for a $53,194,701 total net position.
6
Financial Condition - Continued
Accounts receivable for FY 2013 were $2,428,216, compared to $2,120,107 and $2,185,207 in
FY 2012 and FY 2011, respectively.
Results of Operations
Operating Revenues:
Revenues from operations fall into three categories: electric service, water service and
wastewater service. The ancillary charges such as tap fees, service charges and penalties are
shown in each of the respective categories. The Board has inside and outside the city residential,
commercial and industrial water and sewer customer classes. The Board has seven electric
customer classifications, residential all gas, residential gas hot water heater, residential total
electric, commercial, commercial total electric, industrial and economic development.
The average realized rate from electrical sales in FY 2013 was $92.22 per thousand kwh
delivered compared to $87.42 and $84.26 in FY 2012 and FY 2011, respectively. The average
realized rate from water sales in FY 2013 was $2.91 per thousand gallons compared to $2.72 and
$2.59 in FY 2012 and FY 2011, respectively. The average realized rate from wastewater
treatment in FY 2013 was $4.629 per thousand gallons treated compared to $4.29 and $4.09 in
FY 2012 and FY 2011, respectively.
Capital Contributions and Grants:
The Board agrees to own and operate water and sewer lines that are funded by developers as
long as the facilities are installed in accordance with the Board’s specifications.
During FY 2013, development in Cherokee County was very flat. The Board of Public Works
made very few additions to its physical assets. Other than miscellaneous extension additions to
serve new small commercial development no major extensions were done. During FY 2012 and
FY 2011, Cherokee County received grants to extend water service to various areas within
Cherokee County. The County paid for the installation of water lines with the grant funds in
accordance with the Board’s specifications. Once completed, the County contributed those water
lines to the Board to operate and maintain.
Expenses:
The Board operates and maintains an electrical distribution system, a potable water treatment and
delivery system and, a wastewater collection and treatment system. The overhead electrical
distribution system consists of 18 dedicated circuits originating from 6 different outdoor
substations. The water is treated at the Victor Gaffney and Cherokee Water Treatment Plants
with a capacity of 12 million gallons per day and 6 million gallons per day respectively. During
FY 2013, 2012 and 2011, the Cherokee Water Treatment plant did not operate due to decreased
system demands. The wastewater is treated at the Broad River and Clary Wastewater Treatment
Plants with a capacity of 4.0 million gallons per day and 5.0 million gallons per day respectively.
7
Expenses - Continued:
The following table shows the operating expenses for each of the departments.
Actual Amounts in 1000s
2013
2012
2011
Water operating expenses
Total
Excluding depreciation
Wastewater operating expenses
Total
Electric operating expenses:
Total
$
5,527
3,833
$
5,707
3,957
$
5,786
3,967
$
3,778
2,709
$
3,687
2,593
$
3,532
2,429
$
21,105
19,921
$
20,704
19,472
$
19,628
18,391
The average electric operating cost per thousand kwh delivered was $89.81 in FY 2013 versus
$87.06 and $80.94 in FY 2012 and FY 2011, respectively. These amounts include PMPA’s
wholesale rate increase which was passed onto the Board. The average water operating cost per
thousand gallons consumed was $2.61 in FY 2013 versus $2.59 and $2.55 in FY 2012 and FY
2011, respectively. The wastewater operating cost per thousand gallons treated was $2.93 in FY
2013 versus $2.88 and $2.70 in FY 2012 and FY 2011, respectively. The domestic component
of the wastewater flow is relatively constant and directly proportional to the domestic water flow
but the industrial component and required treatment fluctuates with the strength of the industrial
waste stream. The sewer surcharge rates, industrial discharge permits and other associated fees
related to the industrial wastewater are designed to recover the additional expenses incurred due
to the higher strength waste. The relatively stable cost per thousand gallons is an indication that
the industrial fee structure is effective in recovering those costs.
Cash Flow Activity
The following table shows the Board’s ability to generate net operating cash. Net cash provided
by operating activities is shown both in total dollars and as a percentage of operating revenues.
2013
Total operating revenues
Net cash provided by operations
Net operating cash as a %
of operating revenue
$
2012
33,421,376
2,832,642
8%
8
$
2011
32,279,947
1,805,189
6%
$
31,646,737
2,707,417
9%
Capital Assets and Debt Administration
Capital Assets
At the end of FY 2013, the Board had $31,740,990 invested in capital assets as provided in the
following schedule:
Transmission, Distribution, and
Treatment Facilities
Property and Other Facilities
Vehicles, Office and Maintenance Equipment
Construction in Progress
Accumulated Depreciation
2013
2012
2011
$ 125,822,223
4,971,260
5,816,209
17,945
$ 125,397,267
4,965,260
5,915,084
13,200
$ 124,470,969
4,960,364
5,847,871
13,200
136,627,637
(104,886,647)
$ 31,740,990
136,290,811
(101,671,054)
$ 34,619,757
135,292,404
(97,710,865)
$ 37,581,539
The Board had no significant transactions during the year. For more information on the changes
in capital assets, see Note 3 to the financial statements.
Debt Administration
Rate Covenant
In the Board’s Bond Resolution, the Board covenants and agrees that it will operate the System
in an efficient and economical manner and establish and collect rates and charges for the services
and facilities furnished by the Board. Those rates and charges, with other income, will yield
annual Net Revenues in the fiscal year equal to at least one hundred twenty percent (120%) of
the amounts required to be deposited into each Bond and Interest Redemption Fund for the
current Fiscal Year. Net revenues are defined by the bond resolution to mean, the revenues of
the System after deducting the expenses of operating and maintaining the System.
If in any Fiscal Year the revenues are insufficient to satisfy the rate covenant, the Bond
Resolution obligates the Board to employ a Consulting Engineer to examine the fees, rates, and
other charges of the System and methods of the operations of the system and make
recommendations as the Consulting Engineer believes are appropriate to enable the Board to
satisfy the rate covenant.
For revenue bond debt service coverage schedule see Statistical Table 21.
9
Outstanding Debt
The Board has $8,600,000 in long-term debt outstanding at FY 2013, as provided in the
following schedule:
2013
2012
2011
Revenue Bonds
2005 Combined Utility System Refunding Bond $ 4,920,000
2006 Combined Utility System Revenue Bond
1,265,000
2009 Combined Utility System Refunding Bond
2,415,000
$ 5,430,000
1,400,000
2,645,000
$ 5,925,000
1,530,000
2,870,000
Total Long-term Debt Outstanding
$ 9,475,000
$ 10,325,000
$ 8,600,000
The Board had no significant transactions during the year. For more information on changes in
long-term liabilities, see Note 4 to the financial statements.
Economic Factors
The Board approved FY 2013-2014 operating budget that includes a 6.7% power rate adjustment
for the wholesale power purchased by the Board.
Request for Information
This financial report is intended to provide a general overview of the Board’s finances. For
questions concerning this report or other requests for financial information, please contact:
General Manager
Gaffney Board of Public Works
P.O. Box 64
Gaffney, South Carolina 29342
(864) 488-8800
10
Exhibit A
STATEMENTS OF NET POSITION
MARCH 31, 2013 AND 2012
ASSETS
2013
Current Assets
Cash
Investments
Accounts receivable - net of allowance for
doubtful accounts of $81,847 and $92,909
at March 31, 2013 and 2012, respectively
Other receivables
Inventories
Prepaid expenses
$
Total Current Assets
18,968,118
3,642,442
2012
$
18,360,440
3,467,176
2,428,216
1,712,169
1,069,518
93,598
2,120,107
1,711,465
1,088,803
168,629
27,914,061
26,916,620
Noncurrent Assets
Restricted cash
Investments
Capital assets - net of accumulated depreciation
and amortization
Net other post employment benefit asset
Bond costs - net of amortization
332,000
1,930,858
332,000
2,074,080
31,740,990
3,947,568
308,079
34,619,757
3,263,094
344,689
Total Noncurrent Assets
38,259,495
40,633,620
Total Assets
$
11
66,173,556
$
67,550,240
Exhibit A - Continued
STATEMENTS OF NET POSITION - CONTINUED
MARCH 31, 2013 AND 2012
LIABILITIES AND NET POSITION
2013
Current Liabilities
Accounts payable
Accrued salaries and related withholdings
Accrued interest
Accrued expenses
Other liabilities
Deferred revenue
Bonds payable - current portion
$
270,941
317,520
26,802
2,567,386
2,205,622
15,900
878,161
2012
$
271,109
308,339
29,327
2,433,586
2,082,096
12,475
843,161
Total Current Liabilities
6,282,332
5,980,093
Long-term Liabilities
Bonds payable - net of current portion
7,494,026
8,375,446
Total Liabilities
13,776,358
14,355,539
Net Position
Net investment in capital assets
Restricted - debt service reserve fund
Unrestricted
23,315,909
332,000
28,749,289
25,340,068
332,000
27,522,633
Total Net Position
52,397,198
53,194,701
Total Liabilities and Net Position
$
The accompanying notes are an integral part of the financial statements.
12
66,173,556
$
67,550,240
Exhibit B
STATEMENTS OF REVENUES, EXPENSES AND CHANGES IN NET POSITION
2013
Operating Revenues
Water department
Sewer department
Electrical department
$
Operating Expenses
Water department
Sewer department
Electrical department
Warehouse and
administrative departments
Depreciation expense
Operating Loss
Nonoperating Revenues (Expenses)
Interest income
Gain (loss) on sale of capital assets
Interest expense
Amortization of bond costs
Decrease in Net Position - Before Capital Contributions
6,169,646
5,579,617
21,672,113
33,421,376
2012
$
3,833,264
2,709,239
19,920,771
3,956,713
2,592,610
19,471,890
3,493,728
4,040,263
33,997,265
3,261,385
4,171,536
33,454,134
(575,889)
(1,174,187)
31,205
55,700
(395,421)
(36,609)
(345,125)
70,769
(2,352)
(423,989)
(36,609)
(392,181)
(921,014)
(1,566,368)
123,511
Decrease in Net Position
296,126
(797,503)
Net Position - Beginning of Year
(1,270,242)
53,194,701
Net Position - End of Year
$
13
5,997,203
5,493,537
20,789,207
32,279,947
52,397,198
54,464,943
$
53,194,701
Exhibit C
STATEMENTS OF CASH FLOWS
2013
Cash Flows Provided (Used) by Operating Activities
Cash received from customers
Cash paid to suppliers for goods and services
Cash paid to or for the benefit of employees
$
33,115,988
(21,590,604)
(8,692,742)
2012
$
2,832,642
Cash Flows Provided (Used) by Capital and Related
Financing Activities
Proceeds from the sale of capital assets
Acquisition and construction of capital assets
Principal paid on revenue bonds
Interest paid
Cash Flows Provided (Used) by Investing Activities
Interest received on cash investments
Sale of investments
Net Increase (Decrease) in Cash and Cash Equivalents
Cash and Cash Equivalents - Beginning of Year
1,805,189
55,700
(1,037,985)
(875,000)
(366,842)
20,559
(935,662)
(850,000)
(395,410)
(2,224,127)
(2,160,513)
31,205
179,880
70,769
9,859
211,085
80,628
819,600
(274,696)
18,811,246
Cash and Cash Equivalents - End of Year
$
14
32,268,206
(21,621,590)
(8,841,427)
19,630,846
19,085,942
$
18,811,246
Exhibit C - Continued
STATEMENTS OF CASH FLOWS - CONTINUED
2013
2012
Reconciliation of Operating Loss to Net Cash
Provided (Used) by Operating Activities
Operating loss
$
Adjustments to reconcile operating loss to net
cash provided (used) by operating activities
Depreciation
(Increase) decrease in assets:
Accounts receivable
Unbilled revenue
Inventories
Other current assets
Net other post employment benefit asset
Increase (decrease) in liabilities:
Accounts payable
Accrued salaries and related withholdings
Accrued interest
Accrued expense
Deferred revenue
Other current liabilities
(575,889)
$
4,040,263
4,171,536
(308,109)
(704)
19,285
75,031
(684,474)
65,100
(64,316)
(8,129)
(106,968)
(1,035,517)
(168)
9,181
(2,525)
133,800
3,425
123,526
(173,626)
(6,299)
(2,884)
63,662
(12,525)
89,342
3,408,531
Net Cash Provided (Used) by Operating Activities
$
(1,174,187)
2,832,642
2,979,376
$
1,805,189
Noncash Investing, Capital and Financing Activities
Contribution of capital assets
Bond cost amortization
Amortization expense included in interest
$
$
$
15
123,511
(36,609)
(28,579)
$
$
$
296,126
(36,609)
(28,579)
Exhibit C - Continued
STATEMENTS OF CASH FLOWS - CONTINUED
2013
2012
Reconciliation of Cash and Investments as Shown
on the Balance Sheets and Statements of Cash Flows
Balance sheet classifications
Current assets
Cash
Investments
$
Noncurrent assets
Restricted cash
Investments
18,968,118
3,642,442
22,610,560
$
332,000
1,930,858
2,262,858
Cash flow classifications
Petty cash
Cash deposits
Money market funds
332,000
2,074,080
2,406,080
$
24,873,418
$
24,233,696
$
2,300
18,862,588
765,958
$
2,300
18,255,234
553,712
Total cash and cash equivalents
Certificates of deposit
19,630,846
5,242,572
$
16
18,360,440
3,467,176
21,827,616
24,873,418
18,811,246
5,422,450
$
24,233,696
NOTES TO FINANCIAL STATEMENTS
MARCH 31, 2013 AND 2012
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
This summary of significant accounting policies of the Gaffney Board of Public Works (The Board) is
presented to assist in understanding the financial statements. The financial statements and notes are
representations of the Board's management, who is responsible for their integrity and objectivity.
These accounting policies conform to U.S. generally accepted accounting principles and have been
consistently applied in the preparation of the financial statements.
Management uses estimates and assumptions in preparing financial statements. Those estimates and
assumptions affect the reported amounts of assets and liabilities, the disclosure of contingent assets and
liabilities, and reported revenues and expenses. Actual results could differ from these estimates.
Reporting Entity
The Gaffney Board of Public Works was created pursuant to Act No. 389 of the Acts and Joint
Resolutions of the South Carolina General Assembly, 1907. This and other Acts empower the Board to
be the sole provider of electric, water and sewer services within the corporate limits of the City of Gaffney
and surrounding areas, to establish rules and regulations and to set rates for such services.
Method of Accounting
Under U.S. generally accepted accounting principles (GAAP), the Board is considered to be a selfsupporting enterprise, and these financial statements are presented accordingly. Enterprise funds are
used to account for operations financed and operated in a manner similar to private business enterprises,
where the intent of the governing body is that the cost (expenses, including depreciation) of providing
goods or services to the general public on a continuing basis be financed or recovered primarily through
user charges. Governmental Accounting Standards Board (GASB) is the accepted standard-setting body
for establishing governmental accounting financial reporting principles.
Revenues and Expenses
Operating revenues and expenses consist of those revenues and expenses that result from the ongoing
principal operations of the Board. Operating revenues consist primarily of charges for services. Nonoperating revenues and expenses consist of those revenues and expenses that are related to financing
and investing types of activities and result from non-exchange transactions or ancillary activities.
Cash and Cash Equivalents
For purposes of reporting cash flows, all investments with a maturity of three months or less at the time of
purchase are considered to be cash equivalents.
Investments
Investments are reported at fair value.
Inventories
Inventories are stated at the lower of cost (moving average) or net realizable value.
17
NOTES TO FINANCIAL STATEMENTS - CONTINUED
MARCH 31, 2013 AND 2012
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - CONTINUED
Capital Assets
Capital assets are stated at cost. Donated capital assets are recorded at estimated fair market value on
the date donated.
Major outlays for capital assets and improvements of $500 or more are capitalized as projects are
constructed. Interest costs associated with monies borrowed and used to finance construction of capital
projects have been expensed as a period cost in the year in which it became due.
Capital assets are depreciated using the straight-line method over the following useful lives:
Years
Water plant and lines
Sewer plant and lines
Electrical
Office and warehouse buildings
Office Equipment
Equipment and vehicles
20-50
20-33.3
10-25
20-40
10
4-8
Compensated Absences
Eligible employees receive Personal Time Off (PTO) based on years of service ranging from five (5) to
thirty (30) days annually. The PTO policy provides for no carry over from one calendar year to the next.
st
All unused PTO as of December 31 is paid on an annual basis.
Long-term Debt
Bond premium and discounts, as well as issuance costs, are deferred and equally amortized over the life
of the bonds.
The Board frequently has contributions to its sewer and water system from developers and contractors. In
addition, the Board receives grant monies for construction of improvements or extensions to its system at
various times. These contributions are recognized in the Statements of Revenues, Expenses and
Changes in Net Position when earned.
NOTE 2 - CASH DEPOSITS AND INVESTMENTS
Credit Risk - State statutes authorize the Board to invest in obligations of the United States and its
agencies, general obligations (not revenue obligations) of the State of South Carolina and its subdivisions,
savings and loan associations to the extent of federal insurance, certificates of deposit collaterally
secured, repurchase agreements secured by the foregoing obligations, and the State Treasurer’s
Investment Pool. The Board has no formal investment policy that would further limit its investment
choices.
18
MARCH 31, 2013 AND 2012
NOTE 2 - CASH DEPOSITS AND INVESTMENTS - CONTINUED
Interest rate risk - the Board does not have a formal investment policy limiting investment maturities as a
means of managing its exposure to fair value losses arising from increasing interest rates.
At March 31, 2013 and 2012 the Board had the following investments:
Investment Type
Bank of America Treasury Reserves
Dreyfus Treasury Prime Cash Management
Money Market Fixed Income Fund
Maturity
<60 days
<60 days
<90 days
2013
2012
Rating
AAAm
AAAm
AAAm
$
76,655
358,575
330,728
$
76,316
358,590
118,806
$
765,958
$
553,712
The Gaffney Board of Public Works is required under bond indenture agreements to segregate certain
assets. The following assets have been segregated and are restricted in use. The assets listed below
are shown in their respective categories in the accompanying balance sheet.
2013
Noncurrent Assets
Restricted cash
Debt service reserve fund
$
2012
332,000
$
332,000
The following assets, although not legally restricted, have been designated by the Board:
2013
Depreciation fund
Contingency fund
Customer deposit fund
Operation HOPE
19
2012
$
8,637,597
8,548,182
1,243,470
31,319
$
8,387,546
8,298,131
1,243,463
31,819
$
18,460,568
$
17,960,959
MARCH 31, 2013 AND 2012
NOTE 3 - CAPITAL ASSETS
Components of capital assets include the following for the fiscal years ended March 31, 2013 and 2012:
2013
Balance at
March 31, 2012
Capital Assets
Non depreciable
Land and land rights
Construction in progress
$
Depreciable
Electrical distributions
and transmission lines
Office equipment
Electrical distribution
Office equipment
Capital Assets, Net of
$
1,539,836
13,200
1,553,036
Additions
$
6,000
4,745
10,745
Deletions
$
-
Balance at
March 31, 2013
Transfers
$
-
$
1,545,836
17,945
1,563,781
50,370,972
41,356,885
177,921
87,110
(35,229)
(268,952)
-
50,513,664
41,175,043
33,669,410
3,425,424
2,076,476
3,838,608
134,737,775
464,106
94,632
326,982
1,150,751
(228,341)
(292,148)
(824,670)
-
34,133,516
3,425,424
1,942,767
3,873,442
135,063,856
136,290,811
1,161,496
(824,670)
-
136,627,637
35,470,448
32,727,500
1,611,857
960,157
(35,229)
(268,952)
-
37,047,076
33,418,705
25,600,400
2,728,468
1,837,266
3,306,972
1,004,328
54,557
104,933
304,431
(228,341)
(292,148)
-
26,604,728
2,783,025
1,713,858
3,319,255
101,671,054
4,040,263
(824,670)
-
104,886,647
34,619,757
$
20
31,740,990
MARCH 31, 2013 AND 2012
NOTE 3 - CAPITAL ASSETS - CONTINUED
2012
Balance at
March 31, 2011
Capital Assets
Non depreciable
Land and land rights
Construction in progress
$
Depreciable
Office equipment
Office equipment
Additions
1,539,836
13,200
1,553,036
$
Deletions
-
49,956,263
41,230,603
414,709
126,282
33,284,103
3,420,528
2,003,283
3,844,588
133,739,368
475,448
4,896
118,522
91,931
1,231,788
135,292,404
1,231,788
33,839,528
31,757,141
1,630,920
970,359
24,667,585
2,667,986
1,779,833
2,998,792
1,000,921
60,482
102,763
406,091
97,710,865
4,171,536
$
-
Balance at
March 31, 2012
Transfers
$
-
-
$
1,539,836
13,200
1,553,036
-
50,370,972
41,356,885
(90,141)
(45,329)
(97,911)
(233,381)
-
33,669,410
3,425,424
2,076,476
3,838,608
134,737,775
(233,381)
-
136,290,811
-
35,470,448
32,727,500
(68,106)
(45,330)
(97,911)
-
25,600,400
2,728,468
1,837,266
3,306,972
(211,347)
-
101,671,054
-
Capital Assets, Net of
$
37,581,539
$
34,619,757
Depreciation expense for the fiscal years ending March 31, 2013 and 2012 was $4,040,263 and
$4,171,536, respectively.
NOTE 4 - LONG-TERM DEBT
Components of long-term debt include the following for the fiscal years ending March 31, 2013 and 2012.
2013
Balance at
March 31, 2012
Bonds Payable:
Revenue bonds
Less deferred amounts
Bond premium
Bond discount
Deferred loss on refunding
$
9,475,000
Additions
$
-
40,115
(7,834)
(288,674)
$
9,218,607
$
$
-
21
Balance at
March 31, 2013
Reductions
(875,000)
$
(4,114)
855
31,839
$
(846,420)
8,600,000
Due Within
One Year
$
36,001
(6,979)
(256,835)
$
8,372,187
910,000
(31,839)
$
878,161
MARCH 31, 2013 AND 2012
NOTE 4 - LONG-TERM DEBT - CONTINUED
2012
Balance at
March 31, 2011
Bonds Payable:
Revenue bonds
Less deferred amounts
Bond premium
Bond discount
Deferred loss on refunding
$
10,325,000
Additions
$
-
44,229
(8,688)
(320,513)
$
10,040,028
$
$
Balance at
March 31, 2012
Reductions
-
(850,000)
$
9,475,000
(4,114)
854
31,839
$
Due Within
One Year
$
875,000
40,115
(7,834)
(288,674)
(821,421)
$
9,218,607
(31,839)
$
843,161
Revenue bonds payable at March 31, 2013 and 2012 were comprised of the following issues:
2013
$7,950,000 Combined Utility System Refunding and Improvement Revenue Bonds,
Series 2005 of the City of Gaffney, South Carolina, dated December 1, 2005. Annual
maturities of $180,000 to $700,000 and semi-annual interest rates from 3.625% to 4.0%
maturing in 2021. Bonds were issued to refund a portion of the series 2001 bonds and
to fund certain capital projects.
$
2012
4,920,000
$
5,430,000
$2,100,000 Combined Utility System Revenue Bonds, Series 2006 of the City of
Gaffney, South Carolina, dated March 1, 2006. Annual maturities of $100,000 to
$180,000 and semi-annual interest rates from 3.5% to 4.0% maturing in 2021. Bonds
were issued to fund certain capital projects.
1,265,000
1,400,000
$3,320,000 Combined Utility System Refunding Revenue Bonds, Series 2009 of the
City of Gaffney, South Carolina, dated May 20, 2009. Annual maturities of $220,000 to
$620,000 and semi-annual interest rates from 4.45% to 5.10% maturing in 2021.
Bonds were issued to refund the remaining balance of the series 2001 bonds.
2,415,000
2,645,000
8,600,000
9,475,000
910,000
875,000
Less current maturities
Bonds payable - net of current portion
$
7,690,000
$
8,600,000
Debt service requirements to maturity for the Revenue Bonds are as follows:
Fiscal Year
Ended March 31
2014
2015
2016
2017
2018
2019-2021
$
$
Principal
910,000
940,000
980,000
1,010,000
1,050,000
3,710,000
8,600,000
22
$
$
Interest
328,768
296,078
260,952
224,328
186,406
310,778
1,607,310
$
$
Total
1,238,768
1,236,078
1,240,952
1,234,328
1,236,406
4,020,778
10,207,310
MARCH 31, 2013 AND 2012
NOTE 4 - LONG-TERM DEBT - CONTINUED
Arbitrage rebate liabilities
Arbitrage represents the difference or “spread” between lower interest rates on tax-exempt government
securities and the higher interest on taxable investment securities. The Internal Revenue Code requires
local governments to rebate arbitrage earnings to the federal government every five years for as long as
the local government has tax-exempt bonds outstanding. No estimate of potential liability, if any, has
been made on the accompanying financial statements.
NOTE 5 – ADVANCED REFUNDING AND PRIOR YEAR DEFEASANCE OF DEBT
In prior years, the Board defeased certain revenue bonds by placing the proceeds of the new bonds in an
irrevocable trust to provide for all future debt service payments on the old bonds. Accordingly, the trust
account assets and liabilities for the defeased bonds are not included in the Board’s financial statements.
At March 31, 2013 and 2012, there are no bonds outstanding considered defeased from prior years.
Also in prior years, the advance refundings resulted in book losses that are being amortized over the
original remaining life of the old bonds that were defeased or the life of the new bonds, whichever is
shorter. The unamortized losses at March 31, 2013 and 2012 are included as a direct reduction to bonds
payable on the balance sheets. Amortization has been included in interest expense and was $31,839 for
the years ended March 31, 2013 and 2012.
NOTE 6 - RETIREMENT PLAN
A.
Plan Description
The Gaffney Board of Public Works is a member of the South Carolina Retirement System
(SCRS), one of four defined benefit retirement systems maintained by the Retirement Division of
the State Budget and Control Board of South Carolina. Each system publishes its own component
unit financial report.
The SCRS provides retirement, death, and disability benefits to State employees, public school
employees, and employees of counties, municipalities, and certain other State political
subdivisions. Each system is independent. Assets may not be transferred from one system to
another or used for any purpose other than to benefit each system’s participants.
A comprehensive annual financial report containing financial statement and required
supplementary information for the South Carolina Retirement Board and Police Officers’
Retirement Board is issued and publicly available by writing the South Carolina Retirement
Board, Post Office Box 11960, Columbia, South Carolina 29211-1960.
B.
Funding and Benefit Policies
Title 9 of the South Carolina Code of Laws of 1976 (as amended) prescribes requirements relating
to membership, benefits, and employee/employer contributions for each Board. The following
paragraphs summarize the requirements for the SCRS.
23
MARCH 31, 2013 AND 2012
NOTE 6 - RETIREMENT PLAN – CONTINUED
B.
Funding and Benefit Policies - continued
SCRS is a cost-sharing multiple-employer pension system that benefits employees of public
schools, the State, and its political subdivisions including the Board. Membership is required as a
condition of employment. Effective July 1, 2012, employees contribute at 7.00% (previously
6.50%) of payroll and employers contribute at 10.45% of payroll (previously 9.385%). Effective
July 1, 2013, the employee contribution rate will increase to 7.50% of covered payroll. In addition
to the above rates, participating employers of SCRS contribute .15% of payroll to provide a group
life insurance benefit for their participants.
The Board’s contributions are as follows:
Year Ended
March 31
2013
2012
2011
Employee
Contributions
$
Percent of
Covered
Payroll
289,839
285,224
288,848
7.00%
6.50%
6.50%
Employer
Contributions
$
440,517
425,031
429,539
Percent of
Covered
Payroll
10.60%
9.535%
9.39%
Total
Contributions
$
730,356
710,255
718,387
Actuarially determined contribution requirements are equal to the actual contributions made to
SCRS.
NOTE 7 - DEFERRED COMPENSATION PLANS
The Board offers its employees and Commissioners a deferred compensation plan through the South
Carolina Deferred Compensation Commission, created in accordance with the Internal Revenue Code
Sections 457 and 401(k). The plan, available to all Board employees and Commissioners, permits them
to defer a portion of their salary, up to the maximum allowed by law, until future years. The Board does
not “own” the amounts deferred by plan participants or the related income on those amounts and does not
have a contractual liability to the plan participants, except as it relates to employer matching contributions.
The Board matched employee contributions to the Section 457 and 401(k) plans dollar for dollar. The
Board match for the fiscal years ended March 31, 2013 and 2012 was $611,327 and $579,759,
respectively.
In addition, the Board matches contributions for selected management employees, up to the maximum
amount allowed by the 457 and 401(k) plans and pays related personal income taxes, to nonqualified
supplemental retirement plans. The Board’s expense for the years ended March 31, 2013 and 2012 was
$75,144 and $76,306, respectively, for the contributions and related income taxes.
24
MARCH 31, 2013 AND 2012
NOTE 8 - POST RETIREMENT HEALTH CARE BENEFITS
Description
The Board, through its substantive commitment to provide other post-employment benefits (OPEB),
maintains a single employer defined benefit plan to provide certain postretirement healthcare benefits.
Commissioners and full-time employees and their dependent spouses that meet the plan’s conditions at
the time of retirement are eligible to receive retiree health care benefits at no cost to the retirees. Benefits
provided include medical and dental insurance coverage. Because the Plan consists solely of the Board’s
firm commitment to provide OPEB through the Medicare Part B program and the insurance
reimbursement plan of the Board for retirees 65 and over; and through the self-funded insurance program
for retirees under 65, no stand-alone financial report is either available or generated.
Funding Policy
As of March 31, 2013 and 2012, there were 30 and 26 employee retirees receiving benefits, respectively.
The Plan is financed on a pay-as-you-go basis and through separate contributions to the Gaffney, SC
Board of Public Works Retirement Benefits Trust, a voluntary employee benefit association (VEBA) trust,
as determined annually by the Board. The VEBA trust is organized to fund the costs of medical coverage
for eligible retirees and their dependents provided through the State of South Carolina Insurance Benefits
Program and the insurance reimbursement plan of the Board. The VEBA trust fund balance as of March
31, 2013 and 2012 was $7,200,391 and $6,457,213, respectively.
Annual OPEB Cost and Net OPEB Obligation (Asset)
The Board’s OPEB cost (expense) is calculated based on the annual required contribution (ARC), an
amount actuarially determined in accordance with the parameters of GASB 45. The ARC represents a
level of funding that if paid on an ongoing basis, is projected to cover normal cost each year and amortize
any unfunded (or overfunded) actuarial liabilities over a period not to exceed 30 years. The following table
presents the OPEB cost for the year, the amount actually contributed and changes in the OPEB Plan for
the years ended March 31, 2013 and 2012:
2013
Annual required contribution (ARC)
Interest on net OPEB obligation
Adjustment to ARC
Annual OPEB cost
Contributions made
Increase in net OPEB obligation (asset)
Net OPEB obligation (asset) - beginning of year
Net OPEB obligation (asset) - end of year
25
$
158,380
(146,839)
152,798
164,339
(848,813)
(684,474)
(3,263,094)
$(3,947,568)
2012
$
153,767
(100,241)
101,128
154,654
(1,190,171)
(1,035,517)
(2,227,577)
$(3,263,094)
MARCH 31, 2013 AND 2012
NOTE 8 - POST RETIREMENT HEALTH CARE BENEFITS - CONTINUED
Annual OPEB Cost and Net OPEB Obligation (Asset) - continued
The Board’s annual OPEB cost, the percentage of annual OPEB cost contributed to the Plan and the net
OPEB obligation (asset) for the fiscal years ended March 31, 2013 and 2012 are as follows:
Annual
OPEB Cost
Year Ended
March 31, 2013
March 31, 2012
March 31, 2011
$
$
$
164,339
154,654
148,177
% of OPEB
Contributed
516.50%
548.85%
794.34%
Net OPEB
Obligation (Asset)
$
$
$
(3,947,568)
(3,263,094)
(2,227,577)
Funded Status and Funding Progress
As of March 31, 2010, the most recent actuarial valuation date, the plan was 110.64% funded. The
actuarial accrued liability (AAL) for benefits was $3,949,115, and the actuarial value of assets was
$4,369,164, resulting in an overfunded AAL of $420,049. The covered payroll (annual payroll of active
employees covered by the plan) was $3,783,492, and the ratio of the overfunded AAL to the covered
payroll was 11.10%. Under provisions of the Plan and GASB 45, the next scheduled actuarial valuation is
March 31, 2013 effective for the fiscal year ending March 31, 2014.
Actuarial valuations of an ongoing plan involve estimates of the value of reported amounts and
assumptions about the probability of occurrence of events far into the future. Examples include
assumptions about future employment, mortality, and the healthcare cost trend. Amounts determined
regarding the funded status of the plan and the ARC of the employer are subject to continual revision as
actual results are compared with past expectations and new estimates are made. The required schedule
of funding progress presented as required supplementary information provides multi-year information
showing whether the actuarial value of plan assets are increasing or decreasing over time relative to the
actuarial accrued liability for benefits.
Actuarial Methods and Assumptions
Projections of benefits for financial reporting purposes are based on the substantive plan (the plan as
understood by the employer and plan members) and include the types of benefits provided at the time of
each valuation and the historical pattern of benefit costs by the employer to a point. The actuarial
methods and assumptions used include techniques that are designed to reduce the effects of short-term
volatility in actuarial accrued liabilities and the actuarial value of assets, consistent with the long-term
perspective of the calculations.
In the March 31, 2010 actuarial valuation, the Projected Unit Credit Cost Method was used. The actuarial
assumptions included a 4.50% investment rate of return (net of administrative expenses) and payroll
growth of 3.00%. Actuarial assumptions also included an annual healthcare cost trend rate of 20.94%
initially, reduced by decrements to an ultimate rate of 4.50% in 11 years. Both rates include a 3.00%
inflation assumption. The actuarial value of assets was set equal to the reported market value of assets.
The overfunded AAL is being amortized as a level percent of payroll required to fully amortize the
overfunded AAL over a closed 28 year period, beginning March 31, 2010.
26
MARCH 31, 2013 AND 2012
NOTE 9 - EMPLOYMENT AGREEMENTS
The Board has employment agreements with the two (2) management employees. The general
manager’s employment agreement provides for a minimum base salary, various benefits and a six (6) year
severance package in the event of termination without cause. The operations engineer’s employment
agreement provides for a minimum base salary, various benefits and a three (3) year severance package
in the event of termination without cause.
NOTE 10 - RISK MANAGEMENT
The Board is exposed to various risks of loss related to torts; theft of, damage to, and destruction of assets;
errors and omissions; injuries to employees; and natural disasters. The Board is insured under policies
through the South Carolina Office of Insurance Services, South Carolina Reserve Fund (the Fund) that is a
public entity risk pool. The Board pays premiums to the Fund for its general liability, property and
accidental insurance. The agreement for formation of the Fund provides that the Fund will be selfsustaining through member premiums and will reinsure through commercial companies for each insured
event.
The Board did not have settled claims that exceeded the Board’s insurance coverage in any of the past
three years.
In October 2012, the Board began providing employee health care under a self-funded insurance program.
A commercial insurance company provides aggregate stop loss coverage for claims in excess of
$1,000,000 and specific stop loss coverage for each claim in excess of $25,000. The following represents
the change in unfiled, unpaid claims from April 1, 2012 to March 31, 2013:
2013
Beginning of year liability
Claims
Claims payment
$
292,646
(250,302)
End of year liability
$
42,344
For the fiscal year ending March 31, 2012 and half of the fiscal year ending March 31, 2013, it was the
policy of the Board to provide group health insurance for substantially all of its full time employees and
Commissioners under various Blue Choice of South Carolina plans. The Board paid the employee and
qualifying dependent premiums for this insurance plan. The standard plan paid 90% and the employee
paid 10% of claims up to a maximum of $1,000,000 lifetime. There was no annual deductible per
individual or family under this plan. In addition to this plan, the Board provided employees and
Commissioners with a health reimbursement account intended to assist in payment of increased
deductibles and out of pocket medical, dental, vision and prescription expenses.
The Board’s total expense for these health plans for the fiscal years ended March 31, 2013 and 2012 was
approximately $1,559,856 and $1,404,387, respectively.
The Board also participates in the South Carolina Municipal Insurance Trust for workers compensation
insurance coverage up to the statutory limits.
27
MARCH 31, 2013 AND 2012
NOTE 11 - INTERDEPARTMENTAL ALLOCATION OF COSTS
The Board records on its books, costs allocated to various departments, with the offsetting expense
charged to the individual department. These amounts are included in the utility expenses of the
administrative, service, warehouse, water and sewer departments, and the offset is shown as a reduction
of the total expenses of the water, sewer and electrical departments.
NOTE 12 - FRANCHISE FEES
The Board pays the City of Gaffney a fee of 3.05% of electricity sales. For the fiscal years ended March
31, 2013 and 2012, the Board paid the City $608,344 and $597,214, respectively, in franchise fees.
NOTE 13 - COMMITMENTS AND CONTINGENCIES
A.
Piedmont Municipal Power Agency
The City of Gaffney is a charter member of the Piedmont Municipal Power Agency (PMPA) that
was formed in 1979. PMPA is a public body corporate and politic of the State of South Carolina
consisting of ten municipalities in South Carolina, which purchase electric power from PMPA.
PMPA owns a 25% undivided interest in Unit 2 of Duke Power’s Catawba Nuclear Station in York
County, South Carolina. The City and therefore the Board has agreed pursuant to the Catawba
Nuclear Project Power Sales Agreement, in exchange for a share of the power and energy from
the Catawba Nuclear Station, to take or pay for the cost of its share (10.05%) of the Catawba
Project output whether or not the Project is operable or operating. Such costs are all of PMPA’s
costs resulting from or attributable to the ownership, operation, maintenance, termination,
retirement from service, decommissioning of, necessary repairs and additions, and amounts
required to be deposited to debt service funds. In addition, if any other party to the agreement
defaults, the City/Board’s share of the Project output would increase pro rata by a maximum of 25%
of the nondefaulting participant’s Catawba share prior to any such increases. The Sales
Agreement is in effect until the later of January 1, 2022 or the completion of payment and
satisfaction of bond obligations under the agreement. In no case may the agreement extend
beyond August 1, 2035.
The City/Board is also party to a Supplemental Power Sales Agreement with PMPA under which it
has agreed to take and pay for electric power and energy requirements in excess of those supplied
under the Power Sales Agreement. The term of this agreement expires August 2030.
The City and the Board are not required to make any payments to PMPA under these agreements
except from the revenues of its electric system.
For the years ended March 31, 2013 and 2012, the Board’s purchased power expense from PMPA
was $18,035,530 and $17,425,349, respectively. Also, the amount included in accrued expenses
for accrued purchased power from PMPA at March 31, 2013 and 2012 is $1,460,082 and
$1,369,125 respectively.
28
MARCH 31, 2013 AND 2012
NOTE 13 - COMMITMENTS AND CONTINGENCIES - CONTINUED
B.
Annual Leave/PTO
As described more fully in Note 1, the total amount of PTO accumulated and unused, as of March
31, 2013 and 2012 is as follows:
2013
C.
2012
Beginning of the year liability
Increase
Decrease
$
342,132
374,778
(348,963)
$
339,452
366,612
(363,932)
End of year liability
$
367,947
$
342,132
Unemployment Compensation
The Board is required to pay unemployment compensation on covered employees. It has chosen
the alternative of paying claims as billed by the South Carolina Employment Security Commission.
However, under this method of funding, no accurate estimate of potential liability has been made.
D.
Contract Commitments
There were no outstanding commitments on construction contracts at March 31, 2013 and 2012.
E.
Litigation
Due to the nature of the Board’s normal operating activities, it is routinely subject to a variety of
claims and demands by various individuals and entities. At the present time, the Board is not
involved in any additional litigation that in management’s opinion represents a material potential
liability.
NOTE 14 - RECLASSIFICATIONS
Certain accounts in the prior year financial statements have been reclassified for comparative purposes to
conform to the presentation in the current year financial statements.
29
REQUIRED SUPPLEMENTARY INFORMATION
30
SCHEDULE OF FUNDING PROGRESS FOR RETIREE HEALTH PLAN
MARCH 31, 2013
Actuarial
Valuation
Date
March 31,
Actuarial
Value
of
Assets
(A)
Actuarial
Accrued
Liability
(AAL)
(B)
2008
2010
$ 2,073,531
$ 4,369,164
$ 10,523,834
$ 3,949,115
Unfunded
(Overfunded)
AAL
(B - A)
$
$
8,450,303
(420,049)
31
Ratio
of
Funded
Obligation
(A / B)
Covered
Payroll
(C)
Unfunded
(Overfunded)
AAL as a %
of Covered
Payroll
((B - A) / C)
19.70%
110.64%
$ 4,058,412
$ 3,783,492
208.22%
-11.10%
SUPPLEMENTARY INFORMATION
32
Schedule 1
SCHEDULES OF WATER DEPARTMENT OPERATIONS
2013
Operating Revenues
Water sales
Other
Total Operating Revenues
$
Operating Expenses - Excluding Depreciation
Plant
Salaries and related payroll expenses
Uniforms
Training and schools
Professional fees
Postage
Telephone
Insurance
Vehicle expense
Equipment maintenance and operation
Building and grounds maintenance
Materials and supplies
Chemicals
Other expenses
Bad debts - net
Lab expense
Landfill disposal costs
Other post-employment benefits
Utilities
Maintenance
Uniforms
Professional fees
Telephone
Insurance
Vehicle expense
Other expenses
Utilities
Scholarship program
Costs allocated to other departments
Total Operating Expenses - Excluding Depreciation
Depreciation
Plant depreciation
Maintenance depreciation
Total Operating Expenses
Operating Income (Loss)
$
33
5,847,406
322,240
6,169,646
2012
$
5,633,486
363,717
5,997,203
1,056,150
3,369
1,546
33,431
2,027
5,667
21,368
6,634
122,735
28,660
19,617
208,036
796
5,354
36,600
737
55,862
787,797
2,396,386
1,113,722
4,385
435
31,716
984
6,186
20,742
8,580
228,870
36,212
2,907
164,713
4,353
8,179
35,946
26,712
51,267
835,658
2,581,567
1,275,020
3,064
2,073
3,713
4,881
24,462
50,158
119,749
95,052
137
7,727
500
1,586,536
(149,658)
3,833,264
1,254,660
3,336
560
5,049
5,939
19,556
51,337
85,431
147
119,034
145
7,334
1,263
1,553,791
(178,645)
3,956,713
1,640,954
53,231
1,694,185
1,661,785
88,905
1,750,690
5,527,449
5,707,403
642,197
$
289,800
Schedule 2
SCHEDULES OF SEWER DEPARTMENT OPERATIONS
2013
Operating Revenues
Sewer
Other
$
Plant
Uniforms
Professional fees
Postage
Telephone
Insurance
Vehicle expense
Chemicals
Other expenses
Bad debts - net
Lab expense
Landfill disposal costs
Utilities
Maintenance
Uniforms
Professional fees
Telephone
Insurance
Vehicle expense
Buildings and grounds maintenance
Contract services
Other expenses
Utilities
Scholarship program
Depreciation
Plant depreciation
Maintenance depreciation
Operating Income
$
34
5,534,448
45,169
5,579,617
2012
$
5,388,348
105,189
5,493,537
816,574
2,507
1,520
10,450
12
5,250
20,122
16,372
121,344
33,267
18,176
68,257
395
5,921
48,568
180,015
50,206
877,163
2,276,119
760,445
3,855
861
12,608
5
5,811
20,306
14,865
125,668
27,200
18,469
73,653
165
9,170
52,050
184,754
48,033
913,201
2,271,119
437,843
2,919
846
17,076
4,881
49,547
9,250
10,473
49,826
98,090
473
7,083
500
688,807
(255,687)
2,709,239
401,015
3,331
246
14,550
5,879
18,764
5,770
18,441
147
51,848
104,287
70
6,723
1,263
632,334
(310,843)
2,592,610
986,707
82,496
1,069,203
991,792
102,661
1,094,453
3,778,442
3,687,063
1,801,175
$
1,806,474
Schedule 3
SCHEDULES OF ELECTRICAL DEPARTMENT OPERATIONS
2013
Operating Revenues
Electric sales
Other
$
Power purchased
Line expenses
Uniforms
Professional fees
Telephone
Insurance
Vehicle expense
Other expenses
Bad debts - net
Franchise fees
Contract services
Utilities
Scholarship program
Depreciation
Line Depreciation
Operating Income
$
35
21,278,167
393,946
21,672,113
2012
$
20,267,361
521,846
20,789,207
18,658,039
18,137,519
1,505,366
13,510
14,156
6,887
7,730
59,437
52,306
78,126
7,933
104,020
643
(1,893)
509,361
141,152
51,880
25,439
2,000
21,236,092
(1,315,321)
19,920,771
1,373,320
16,154
5,055
34,287
8,199
49,617
58,832
161,858
7,932
111,319
4,347
(6,211)
597,214
144,679
49,300
25,314
20,778,735
(1,306,845)
19,471,890
1,184,329
1,232,074
21,105,100
20,703,964
567,013
$
85,243
Schedule 4
SCHEDULES OF WAREHOUSE AND ADMINISTRATIVE EXPENSES
2013
Warehouse
Uniforms
Professional fees
Postage
Telephone
Insurance
Vehicle expense
Other expenses
Utilities
$
Administrative
Uniforms
Professional fees
Public relations
Postage
Telephone
Insurance
Vehicle expense
Other expenses
Computer processing
Utilities
Scholarship program
Total Warehouse and Administrative Expenses Excluding Depreciation
Depreciation
Warehouse depreciation
Administration depreciation
Total Warehouse and Administrative Expenses
$
36
335,811
1,101
2,076
1,529
2,308
2,552
7,211
1,185
3,854
1,005
7,273
50
2,487
16,742
385,184
2012
$
312,967
1,018
3,024
1,316
2,920
3,420
6,151
849
3,877
9,067
9
2,530
15,890
363,038
2,426,347
646
24,760
67,069
75,639
3,240
25,616
21,835
1,793
12,349
163,249
110,266
62,865
71,130
3,903
31,837
6,000
3,108,544
2,428,827
6,049
15,385
64,158
46,377
3,065
28,180
18,298
2,662
16,963
54,839
96,683
32,371
52,605
3,525
24,360
4,000
2,898,347
3,493,728
3,261,385
29,369
63,177
92,546
28,041
66,278
94,319
3,586,274
$
3,355,704
III. STATISTICAL SECTION
(UNAUDITED)
Statistical Section
This part of the Gaffney Board of Public Work’s comprehensive annual
financial report presents detailed information as a context for understanding
what the information in the financial statements, note disclosures, and
required supplementary information says about the government’s overall
financial health.
Contents
Financial Trends
These schedules contain trend information to help the reader understand how the
Board’s financial performance and well-being have changed over time.
Revenue Capacity
These schedules contain information to help the reader assess the Board’s most
significant revenue source, user charges.
Debt Capacity
These schedules present information to help the reader assess the affordability of the
Board’s current levels of outstanding debt and the Board’s ability to issue additional debt
in the future.
Demographic and Economic Information
These schedules offer demographic and economic indicators to help the reader
understand the environment within which the Board’s financial activities take place.
Operating Information
These schedules contain service and infrastructure data to help the reader understand
how the information in the Board’s financial report relates to the services the Board
provides and the activities it performs.
Sources: Unless otherwise noted, the information in these schedules is derived from the
comprehensive annual financial reports for the relevant year.
37
Table 1
Net Investment
in Capital Assets
$
23,315,909
25,340,068
27,406,721
29,534,649
31,729,676
35,582,627
37,706,073
38,971,856
41,792,112
46,446,374
$
Restricted
332,000
332,000
332,000
332,000
$
-
-
Unrestricted
28,749,289
27,522,633
26,726,222
25,390,868
24,031,406
23,153,746
22,737,324
22,661,806
22,437,687
20,023,432
70,000,000
50,000,000
30,000,000
38
2004
2005
2007
2006
2008
2010
2009
2011
2013
10,000,000
2012
Fiscal
Year
2013
2012
2011
2010
2009
2008
2007
2006
2005
2004
Total Net Position
$
52,397,198
53,194,701
54,464,943
55,257,517
55,761,082
58,736,373
60,443,397
61,633,662
64,229,799
66,469,806
Table 2
FY 2013
FY 2012
FY 2011
Water Department
$ 6,169,646
$ 5,997,203
Sewer Department
5,579,617
5,493,537
21,672,113
20,789,207
FY 2010
FY 2009
FY 2008
FY 2007
FY 2006
FY 2005
FY 2004
5,871,250
$ 5,653,814
$ 5,205,513
5,054,359
$ 4,810,342
5,342,009
4,975,429
4,899,129
5,273,289
5,047,793
4,651,535
4,486,256
4,390,885
20,433,478
19,482,322
18,635,803
18,885,627
17,225,746
17,042,073
16,301,783
16,166,240
Revenues
Operating Revenue
Non-Operating Revenue
$
$
5,597,149
$
$
4,866,970
$
4,738,437
86,905
68,417
109,895
219,855
479,885
1,134,852
1,171,071
716,375
313,213
271,683
33,508,281
32,348,364
31,756,632
30,331,420
29,220,330
30,890,917
28,498,969
27,220,325
25,968,222
25,567,245
Water Department
3,833,264
3,956,713
3,966,949
3,795,851
4,353,679
4,676,445
3,937,989
3,567,289
3,311,106
2,979,523
Sewer Department
2,709,239
2,592,610
2,428,637
2,554,967
2,654,926
2,898,835
2,598,495
2,730,892
2,269,976
2,090,988
19,920,771
19,471,890
18,390,839
16,983,017
16,708,331
16,587,006
15,115,929
15,087,647
13,515,458
13,602,935
3,493,728
3,261,385
3,024,507
2,926,888
3,137,955
3,536,316
2,757,229
2,792,245
2,760,772
2,695,698
4,040,263
4,171,536
4,322,573
4,477,470
4,944,567
5,171,491
5,214,926
5,242,744
4,973,715
4,744,729
Total Revenues
Expenses
Operating Expenses, Excluding Depreciation
Service, Warehouse and
39
Administrative Departments
Depreciation Expense
Non-Operating Expenses
Total Expenses
Excess (Deficiency), Before Capital Contributions
Increase (Decrease) in Net Position
Net Position, Beginning of Year
Prior Period Adjustment
Net Position, End of Year
432,030
460,598
487,513
474,706
567,335
584,477
640,843
395,645
462,209
474,461
34,429,295
33,914,732
32,621,018
31,212,899
32,366,793
33,454,570
30,265,411
29,816,462
27,293,236
26,588,334
(3,146,463)
(2,563,653)
(1,766,442)
(2,596,137)
(1,325,014)
(1,021,089)
(921,014)
123,511
(797,503)
(1,566,368)
296,126
(1,270,242)
(864,386)
(881,479)
71,812
377,914
(792,574)
(503,565)
171,172
856,629
576,177
-
(2,975,291)
(1,707,024)
(1,190,265)
(2,596,137)
53,194,701
54,464,943
55,257,517
55,761,082
58,736,373
60,443,397
61,633,662
64,229,799
-
-
-
-
-
-
-
-
$ 52,397,198
$ 53,194,701
$ 54,464,943
$ 55,257,517
$ 55,761,082
$ 58,736,373
$ 60,443,397
$ 61,633,662
472,900
49,872
(852,114)
(971,217)
66,469,806
(1,387,893)
$ 64,229,799
67,441,023
-
$ 66,469,806
Table 3
Revenues by Source
Operating Revenues
Fiscal
Year
2013
Non Operating Revenues
Interest
Misc.
Income
Income
$
31,205
$
55,700
Total
Revenue
$ 33,508,281
Sewer
$ 5,579,617
Electric
$ 21,672,113
2012
5,997,203
5,493,537
20,789,207
70,769
(2,352)
32,348,364
2011
5,871,250
5,342,009
20,433,478
73,075
36,820
31,756,632
2010
5,653,814
4,975,429
19,482,322
186,837
33,018
30,331,420
2009
5,205,513
4,899,129
18,635,803
416,679
63,206
29,220,330
2008
5,597,149
5,273,289
18,885,627
1,079,001
55,851
30,890,917
2007
5,054,359
5,047,793
17,225,746
1,144,436
26,635
28,498,969
2006
4,810,342
4,651,535
17,042,073
699,936
16,439
27,220,325
2005
4,866,970
4,486,256
16,301,783
279,611
33,602
25,968,222
2004
4,738,437
4,390,885
16,166,240
269,389
2,294
25,567,245
40
Water
$ 6,169,646
Table 4
Electric Department Operating Expenses
For The Fiscal Years Ended March 31, 2004 Through 2013
EXPENSES
Power Purchased
2004
$
2005
13,616,111
$
14,042,199
$
15,151,293
$
2010
15,308,495
$
2011
15,681,833
$
2012
17,274,243
$
2013
18,137,519
$ 18,658,039
1,151,716
1,101,548
1,399,127
1,135,269
1,073,258
1,257,488
1,373,320
1,505,366
Uniforms
13,131
13,895
16,535
12,618
13,469
14,057
13,373
16,139
16,154
13,510
Training & Schools
12,512
7,672
12,466
17,168
28,116
23,313
912
4,164
5,055
14,156
Professional Fees
87,869
60,407
4,111
20,660
6,315
13,307
360
15,240
34,287
6,887
900
-
-
-
-
-
-
-
-
-
Telephone
7,891
5,972
4,986
4,141
5,696
7,981
8,407
8,261
8,199
7,730
Insurance
51,617
57,946
72,017
78,352
80,652
64,470
58,992
55,858
49,617
59,437
41
Bldg Grnd & Maint.
$
2009
1,073,427
Equip O & M
12,577,083
2008
966,657
Vehicle Expense
$
2007
Salaries
Postage
12,682,772
2006
46,122
46,078
45,774
48,453
47,717
61,910
30,926
38,502
58,832
52,306
100,367
76,196
117,840
115,381
176,833
157,566
221,760
86,533
161,858
78,126
9,251
10,974
9,850
10,754
11,071
11,188
7,742
8,972
7,932
7,933
Materials & Supplies
59,610
71,016
113,029
98,684
97,368
94,609
85,643
75,315
111,319
104,020
Other Expenses
13,378
25,408
24,768
31,249
30,232
21,858
20,799
4,799
4,347
Bad Debts - Net
25,355
4,818
1,605
42,728
(37,729)
1,114
1,495
1,216
(6,211)
Computer Processing
Franchise Fee
Post Emloy. Benefits
Contract Services
Utilities
Scholarship Program
Depreciation
643
(1,893)
115
-
-
-
218
-
-
-
-
-
461,786
470,173
493,875
496,368
549,083
540,622
561,977
590,419
597,214
509,361
79,353
84,012
70,271
82,613
100,000
226,214
232,697
47,657
49,300
51,880
-
-
435,526
100,000
132,349
132,111
142,317
144,636
144,679
141,152
23,926
21,419
21,759
23,424
24,045
23,154
26,267
23,534
25,314
25,439
-
-
-
-
-
-
-
-
-
2,000
1,521,988
1,547,048
1,638,564
1,600,790
1,625,654
1,478,181
1,255,191
1,236,737
1,232,074
1,184,329
(1,039,676)
(1,091,038)
(1,124,592)
(1,210,411)
(1,228,849)
(1,128,907)
(1,185,741)
(1,262,137)
(1,306,845)
(1,315,321)
Costs Allocated to
Other Depts.
TOTAL
$
15,124,924
$
15,062,506
$
16,726,211
$
16,716,719
$
18,212,660
$
18,186,512
$
18,238,208
$
19,627,576
$
20,703,964
$ 21,105,100
Table 5
Water Department Operating Expenses
EXPENSES
Salaries
2004
$
Uniforms
Training & Schools
Professional Fees
Postage
Telephone
2005
1,413,098
$
2006
1,677,695
$
2007
1,625,572
$
2008
1,951,313
$
2009
2,671,362
$
2010
2,250,014
$
2011
2,169,145
$
2012
2,324,965
$
2013
2,368,382
$
2,331,170
10,868
7,610
9,311
8,060
8,312
9,017
7,076
9,978
7,721
6,433
7,797
5,770
4,363
7,682
5,640
6,249
4,726
4,251
995
3,619
223,629
53,488
30,398
41,289
58,961
246,492
23,469
37,855
36,765
37,144
2,645
1,079
1,834
3,029
1,460
1,587
929
867
984
2,027
11,538
12,020
13,673
14,856
19,023
13,928
13,841
12,592
12,125
10,548
45,830
Insurance
55,338
54,245
67,024
60,073
58,161
59,974
45,505
42,476
40,298
Vehicle Expense
28,518
46,192
53,388
53,754
58,746
73,488
44,825
54,390
59,917
56,792
243,547
190,330
224,030
336,029
312,467
235,571
228,671
287,684
314,301
242,484
Bldg Grnds & Maint.
57,392
106,006
44,384
71,882
56,307
56,322
36,457
32,273
36,359
28,660
245,797
350,634
322,701
422,529
420,397
433,893
304,959
153,320
121,941
114,669
Equip O & M
42
Chemicals
-
-
-
-
-
-
-
184,146
164,713
208,036
15,301
51,293
28,070
31,683
20,761
21,575
19,652
1,786
4,498
883
Bad Debts-Net
33,261
34,587
13,142
51,686
7,668
11,896
16,080
11,714
8,179
5,354
Lab Expense
33,743
39,400
42,400
31,922
41,927
41,026
29,483
38,893
35,946
36,600
Landfill Costs
6,435
21,879
5,967
38,922
42,874
9,118
30,155
27,966
26,712
737
-
-
435,525
100,000
100,000
234,687
241,827
48,666
51,267
55,862
754,170
791,331
772,041
819,086
924,390
779,032
717,828
824,209
842,992
795,524
-
-
-
-
-
1,000
1,811
2,090
1,263
500
1,428,854
1,651,612
1,941,918
2,014,359
2,011,567
2,109,829
1,911,620
1,818,625
1,750,690
1,694,185
Other Expenses
Public Relations
50
Post Employ. Benefits
Utilities
Scholarship Program
Depreciation
Costs Allocated to
Other Depts.
TOTAL
(163,554)
$
4,408,377
(132,453)
$
4,962,718
(126,534)
$
5,509,207
(105,806)
$
5,952,348
(132,011)
$
6,688,012
(131,190)
$
6,463,508
(140,588)
$
5,707,471
(133,172)
$
5,785,574
(178,645)
$
5,707,403
(149,658)
$
5,527,449
Table 6
Sewer Department Operating Expenses
EXPENSES
Salaries
2004
$
2005
886,838
$
2006
1,068,058
$
2007
1,086,810
$
2008
1,101,704
$
2009
1,609,789
$
2010
1,212,634
$
2011
1,158,618
$
2012
1,216,713
$
2013
1,161,460
$
1,254,417
Uniforms
8,295
5,420
8,189
6,418
7,706
7,971
8,696
8,214
7,186
5,426
Training & Schools
5,223
9,002
7,111
10,462
8,734
5,678
3,688
5,273
1,107
2,366
Professional Fees
10,585
21,000
3,750
13,246
(8,456)
1,680
590
18,299
27,158
27,526
819
65
95
52
93
45
44
27
5
12
20,015
15,395
18,269
18,526
8,611
10,453
11,522
12,136
11,690
10,131
69,669
Postage
Telephone
Insurance
42,683
52,349
53,541
51,040
58,874
62,514
44,705
39,987
39,070
Vehicle Expense
20,938
18,336
17,953
27,218
32,302
42,792
21,799
20,437
20,635
25,622
140,061
126,958
82,837
130,489
166,807
146,889
70,540
66,443
144,109
131,817
Bldg Grnd & Maint
36,705
58,518
39,757
47,376
36,124
34,997
27,307
25,413
27,347
33,267
69,971
86,037
88,795
109,044
103,727
108,586
135,641
64,216
70,317
68,002
68,257
Equip O & M
43
Chemicals
-
-
-
-
-
-
-
70,712
73,653
Other Expenses
14,784
18,391
16,237
12,865
26,187
20,228
22,218
523
235
868
Bad Debt - Net
35,373
35,789
16,737
51,383
4,387
12,672
16,171
9,993
9,170
5,921
Lab Expense
151,447
39,995
58,996
70,593
53,067
54,927
38,376
37,926
52,050
48,568
Landfill Cost
238,467
312,617
345,430
379,979
275,931
242,335
190,783
235,112
184,754
180,015
-
-
435,525
100,000
100,000
226,214
223,949
46,615
48,033
50,206
698,834
638,206
678,025
656,341
644,813
682,115
819,381
778,488
919,924
884,246
Power Purchased
-
-
-
-
-
2,646
-
-
-
-
Contract Services
-
-
-
-
3,353
-
-
-
104,287
98,090
Utilities
Scholarship Program
Depreciation
-
-
-
-
3,210
8,757
4,195
1,090
1,263
500
1,516,289
1,531,706
1,441,438
1,402,201
1,317,657
1,137,185
1,102,804
1,103,650
1,094,453
1,069,203
Costs Allocated to
Other Depts.
TOTAL
(290,050)
$
3,607,277
(236,160)
$
3,801,682
(227,165)
$
4,172,330
(188,241)
$
4,000,696
(236,424)
$
4,216,492
(229,207)
$
3,792,111
(243,256)
$
3,657,771
(228,980)
$
3,532,287
(310,843)
$
3,687,063
(255,687)
$
3,778,442
Table 7
Warehouse & Administrative Expenses
EXPENSES
Salaries
2004
$
2005
2,103,319
$
2006
2,111,952
$
2007
2,053,573
$
2008
2,137,152
$
2009
2,982,636
$
2010
2,317,995
$
2011
2,400,204
$
2,548,666
2012
$
2,741,794
2013
$
2,762,158
Uniforms
11,694
10,716
8,714
7,121
10,776
5,932
1,202
6,936
7,067
1,747
Training/Schools
33,647
23,646
24,617
32,375
25,556
44,742
17,344
37,512
18,409
26,836
Professional Fees
127,775
185,883
216,594
96,408
91,903
257,430
72,769
61,137
65,474
68,598
Public Relations
44
-
-
-
-
-
-
-
33,282
46,377
75,639
Telephone
41,460
31,773
35,158
35,658
38,414
22,818
22,528
21,175
31,600
28,168
Insurance
38,713
29,407
43,887
38,988
46,898
52,223
40,037
32,762
24,449
29,046
Vehicle Expense
26,945
11,101
9,846
11,512
13,029
13,672
10,235
3,253
3,511
2,978
Equip O & M
36,809
40,546
37,817
30,592
30,631
20,263
24,707
27,499
20,840
16,203
Bldg Grnd & Maint.
21,660
31,253
44,549
103,635
38,381
83,991
41,727
48,892
54,839
164,254
Postage
14,416
11,081
5,729
5,924
5,651
5,472
4,460
4,906
5,985
5,548
96,522
90,050
86,982
107,403
99,216
115,542
98,283
85,954
105,750
117,539
Other Expenses
66,450
76,565
64,508
60,634
45,609
66,816
38,729
26,058
32,380
62,915
Computer Processing
40,241
77,283
129,775
56,982
70,232
56,022
60,803
38,376
52,605
71,130
-
-
-
-
-
36,517
44,643
5,239
6,055
6,390
36,047
29,516
30,496
32,845
32,899
33,520
41,217
36,860
40,250
48,579
-
-
-
-
4,485
5,000
8,000
6,000
4,000
6,000
277,598
243,349
220,824
197,576
216,613
219,372
207,855
163,561
94,319
92,546
Utilities
Scholarship Program
Depreciation
TOTAL
$
2,973,296
$
3,004,121
$
3,013,069
$
2,954,805
$
3,752,929
$
3,357,327
$
3,134,743
$
3,188,068
$
3,355,704
$
3,586,274
Table 8
Annual Billed Electric Usage
From the Fiscal Years Ended March 31, 2004 Through 2013
Annual Billed Electric Usage (MWH)
Customer Category
Residential
Commercial
Industrial
Security Lights
Inter-Departmental
Municipal
Inter-Dept. Lights
City Lights
Total
FY 04
67
86
34
4
14
0.7
0.3
1
207
FY 05
69
88
36
4
15
0.7
0.3
1
214
FY 06
70
89
45
3.5
15.5
0.7
0.3
1
225
FY 07
69.5
90.5
43
3.5
17
0.7
0.3
1
225.5
FY 08
71.3
96
54
3.4
17
0.9
0.1
1.2
243.9
FY 09
71
96
52
3.6
15
0.5
0.1
1.2
239.4
FY 10
73.5
93
43
3.7
15
0.9
0.1
1.2
230.4
FY 11
77
99
46.5
3.7
14
0.9
0.1
1.3
242.5
FY 12
70.5
95
50.4
3.8
16
0.8
0.1
1.2
237.8
45
250
243.9
242.5
239.4
240
237.8
235
230.4
MWH
230
220
210
225
225.5
FY 06
FY 07
214
207
200
190
180
FY 04
FY 05
FY 08
FY 09
FY 10
FY 11
FY 12
FY 13
FY 13
68.2
94.4
51.3
3.6
14.3
0.8
1.2
1.2
235
Table 9
Annual Billed Water Usage
Annual Billed Water Usage (Million Gallons)
Customer Category
Residential
Commercial
Industrial
Water Districts
Inter-Departmental
City
Sprinklers
Total
FY 04
493
236
703
405
84
2
15
1,938
FY 05
501
200
844
374
68
2
11
2,000
FY 06
489
213
813
425
65
2
13
2,020
FY 07
492
226
836
495
53
2
16
2,120
FY 08
495
199
912
473
56
3
21
2,159
FY 09
487
202
834
498
63
3
14
2,101
Million Gallons
46
2,300
2,250
2,200
2,150
2,100
2,050
2,000
1,950
1,900
1,850
1,800
1,750
FY 10
432
181
907.2
456
64
2.4
10.4
2,053
FY 11
486
206
1,001
489
65
3.5
16.5
2,267
2,267
2,201
2,159
2,120
2,117
2,101
2,053
2,000
2,020
1,938
FY 04 FY 05 FY 06 FY 07 FY 08 FY 09 FY 10 FY 11 FY 12
FY13
FY 12
465
211.5
994
434
78
3
15.5
2,201
FY13
444.3
212
975.2
410.3
59.2
3
13
2,117
Table 10
Annual Billed Sewer Usage
Annual Billed Sewer Usage (Million Gallons)
Customer Category
Residential
Commercial
Industrial
Inter-Departmental
City
Total
FY 04
344
236
547
86
2
1,215
FY 05
351
201
681
67
2
1,302
FY 06
337
188
698
64
2
1,289
47
1,600
Million Gallons
1,400
1,292
1,302 1,289
FY 07
338
205
778
53
2
1,376
1,376
FY 08
345
205
834
65
2
1,451
FY 09
365
194
700
63
2
1,324
FY 10
328
184
658
58
1
1,229
1,451
1,324
1,229
1,307 1,280
1,207
1,200
1,000
800
600
400
200
0
FY 04 FY 05 FY 06 FY 07 FY 08 FY 09 FY 10 FY 11 FY 12 FY 13
FY 11
336
200
704
65
2
1,307
FY 12
321
210
670
78
1
1,280
FY 13
308
201
647.5
49
1.5
1,207
Table 11
Historical Average Residential Electric Rate
Fiscal
Year
Monthly
Facilities
Charge
Rate per
KWH
Average
Monthly
Billing
2013
$16.00
$0.08736
$105.01
2012
$15.00
$0.08232
$101.68
2011
$13.75
$0.07821
$103.84
2010
$13.75
$0.07841
$98.67
2009
$13.06
$0.07481
$91.16
2008
$13.06
$0.07481
$90.94
2007
$12.06
$0.07433
$87.21
2006
$12.06
$0.07443
$84.78
2005
$12.06
$0.07446
$84.14
2004
$12.06
$0.07461
$81.00
Note: Rates are based on:
1. User Charges in effect for each year.
2. The calculated monthly usage which is the Annual Residential Billed
Usage shown in Table 8 divided by the Number of Residential
Customers shown in Table 14 for each year.
48
Table 12
Historical Average Residential Water Rate
Inside the City
Fiscal
Year
Monthly
Minimum
Charge
2013
Outside the City
Rate per
Gallon
Average
Monthly
Billing
Monthly
Minimum
Charge
Rate per
Gallon
Average
Monthly
Billing
$10.60
$0.00137
$ 16.52
$15.90
$0.00245
$ 26.41
2012
$10.00
$0.00129
$ 15.78
$15.00
$0.00231
$ 25.31
2011
$9.25
$0.00123
$ 14.99
$13.75
$0.00219
$ 23.98
2010
$9.25
$0.00123
$ 14.36
$13.75
$0.00219
$ 22.85
2009
$8.60
$0.00116
$ 14.04
$13.10
$0.00209
$ 22.89
2008
$8.60
$0.00116
$ 14.19
$13.10
$0.00209
$ 23.18
2007
$7.54
$0.00116
$ 13.13
$12.06
$0.00209
$ 22.13
2006
$7.54
$0.00116
$ 13.02
$12.06
$0.00209
$ 21.94
2005
$7.54
$0.00116
$ 13.12
$12.06
$0.00209
$ 22.11
2004
$7.54
$0.00116
$ 13.09
$12.06
$0.00209
$ 22.07
1. User Charges in effect for each year.
Usage shown in Table 9 divided by the Number of Residential
49
Table 13
Historical Average Residential Sewer Rate
Inside the City
Fiscal
Year
Monthly
Minimum
Charge
2013
Outside the City
Rate per
Gallon
Average
Monthly
Billing
Monthly
Minimum
Charge
Rate per
Gallon
Average
Monthly
Billing
$10.60
$0.00266
$ 21.68
$15.90
$0.00361
$ 30.94
2012
$10.00
$0.00251
$ 20.87
$15.00
$0.00341
$ 29.74
2011
$8.75
$0.00238
$ 19.48
$12.75
$0.00323
$ 27.34
2010
$8.75
$0.00238
$ 19.18
$12.75
$0.00323
$ 26.93
2009
$8.10
$0.00227
$ 19.30
$12.10
$0.00209
$ 22.41
2008
$8.10
$0.00227
$ 18.96
$12.10
$0.00209
$ 22.10
2007
$7.04
$0.00227
$ 17.74
$11.06
$0.00209
$ 20.91
2006
$7.04
$0.00227
$ 17.48
$11.06
$0.00209
$ 20.67
2005
$7.04
$0.00227
$ 17.88
$11.06
$0.00209
$ 21.04
2004
$7.04
$0.00227
$ 17.75
$11.06
$0.00209
$ 20.92
1. User Charges in effect for each year
Usage shown in Table10 divided by the Number of Residential
50
Table 14
Number of Electric Customers by Customer Category
For the Fiscal Years Ended March 31, 2004 Through 2013
Customer Category
51
Mar-04
Mar-05
Mar-06
Mar-07
Mar-08
Mar-09
Mar-10
Mar-11
Mar-12
Mar-13
Residential
Commercial
Industrial
Security Lights
Inter-Departmental
City
Inter-Departmental Lights
City Lights
6,047
1,164
26
1,412
19
25
14
24
6,023
1,176
29
1,425
20
22
14
22
5,995
1,181
24
1,423
22
21
16
21
5,731
1,446
25
1,421
22
21
18
21
5,704
1,495
26
1,451
22
21
18
22
5,660
1,582
24
1,440
22
24
18
24
5,614
1,617
21
1,447
21
24
18
24
5,580
1,627
21
1,490
20
23
18
22
5,577
1,577
23
1,496
21
22
20
24
5,582
1,530
31
1,482
21
24
20
25
Total
8,731
8,731
8,703
8,705
8,759
8,794
8,786
8,801
8,760
8,715
Table 15
Number of Water Customers by Customer Category
Customer Category
Residential
Commercial
Industrial
Water District
Inter-Departmental
City
Sprinklers
Mar-05
Mar-06
Mar-07
Mar-08
Mar-09
Mar-10
Mar-11
Mar-12
Mar-13
8,581
994
51
10
15
23
74
8,680
1,040
63
10
15
21
87
8,625
1,035
62
10
16
21
94
8,513
1,222
60
10
16
22
100
8,557
1,239
58
10
16
24
104
8,655
1,195
57
10
16
28
111
8,676
1,186
69
10
16
28
114
8,684
1,165
54
10
17
30
121
8,687
1,154
54
10
18
29
131
8,616
1,134
47
10
18
30
113
9,748
9,916
9,863
9,943
10,008
10,072
10,099
10,081
10,083
52
Mar-04
Total
9,968
Table 16
Number of Sewer Customers by Customer Category
Customer Category
Residential
Commercial
Industrial
Inter-Departmental
City
Total
Mar-04
Mar-05
Mar-06
Mar-07
Mar-08
Mar-09
Mar-10
Mar-11
Mar-12
Mar-13
6,074
832
44
9
12
6,123
847
48
9
11
6,109
848
47
9
10
5,973
1,029
46
9
10
6,010
1,045
44
9
10
6,164
1,004
43
9
12
6,216
994
43
9
11
6,209
977
42
9
10
6,188
953
43
9
9
6,156
956
43
9
10
6,971
7,038
7,023
7,067
7,118
7,232
7,273
7,247
7,202
7,174
53
Table 17
Ten Largest Electric Customers
FY 2013
Annual
Usage
(kwh)
9,867,200
% Gross
Revenue
3.29%
Customer
1. Core Materials
FY 2004
Annual
Usage
(kwh)
7,466,880
Total
Revenue
$ 713,484
2. Carthuplas
9,106,800
547,678
2.53%
2. Brown Packing
6,676,921
447,323
2.77%
3. Brown Packing
8,455,232
700,099
3.23%
3. Wal-Mart
6,128,064
248,723
1.54%
4. Carolina Cotton
5,477,178
446,210
2.06%
4. Upstate Carolina Med.
4,966,805
315,647
1.95%
5,397,000
413,755
1.91%
5. Carolina Cotton
4,197,120
275,505
1.70%
6. Core Molding Tech.
5,109,120
339,989
1.57%
6. Limestone College
3,512,961
234,648
1.45%
7. Wal-Mart
5,014,080
285,750
1.32%
7. Gaffney High School
2,378,800
170,973
1.06%
8. Gaffney High School
3,588,108
325,855
1.50%
8. Pilot Travel Center
2,345,400
143,131
0.89%
9. Limestone College
2,659,200
206,451
0.95%
9. Bi-Lo
2,166,960
130,566
0.81%
10. Ingles on Baker Blvd
2,384,400
173,510
0.80%
10. Ametex
2,051,500
140,316
0.87%
$ 4,152,781
19.16%
$ 2,416,942
14.96%
Customer
1. Suminoe
54
TOTAL
Total
Revenue
$ 310,110
% Gross
Revenue
1.92%
Table18
Ten Largest Water Customers
Customer
1. Nestle
FY 2013
Annual
Usage
(MG)
282
Total
Revenue
$ 536,219
% Gross
Revenue
8.69%
Customer
1. Nestle
FY 2004
Annual
Usage
(MG)
384
Total
Revenue
$ 533,910
% Gross
Revenue
11.27%
55
2. Cherokee County Co-Gen
209
404,002
6.55%
2. City of Blacksburg
190
311,045
6.56%
3. City of Blacksburg
159
322,142
5.22%
3. Cherokee Co. Co-Gen.
74
120,289
2.54%
4. Draytonville Water
103
218,800
3.55%
4. Draytonville Water
108
183,725
3.88%
5. Suminoe Textile
101
209,888
3.40%
5. Macedonia Water
50
92,088
1.94%
6. Carolina Cotton Works
92.5
91,620
1.49%
6. Goucher Water
39
68,359
1.44%
58
131,407
2.13%
88
66,495
1.40%
56.5
116,616
1.89%
8. SC Highway Department
31
52,560
1.11%
9. Brown Packing
54
61,508
1.00%
9. Timken Bearings
21
41,786
0.88%
10. Goucher Water
37
84,901
1.38%
10. Musgrove Mills
21
41,703
0.88%
$ 2,177,103
35.30%
$ 1,511,960
31.90%
7. Macedonia Water
8. Grassy Pond Water District
TOTAL
Table 19
Ten Largest Sewer Customers
56
Customer
1. Nestle
FY 2013
Annual
Discharge
(MG)
223
2. Suminoe Textile
101
412,151
7.39%
85
201,627
4.59%
92.5
273,123
4.90%
3. Hamrick Industries
28
98,505
2.24%
4. Brown Packing
53.0
157,471
2.82%
4. Cherokee Co. Co-Gen
32
97,045
2.21%
5. Parkdale Mills
26.5
114,960
2.06%
5. Brown Packing
28
70,479
1.61%
6. Cherokee Co. Co-Gen.
24
105,237
1.89%
6. Bommer Industries
17
63,177
1.44%
7. Carthuplas
16
50,228
0.90%
7. Springfield LLC
10
34,672
0.79%
8. Jetline
12
35,189
0.63%
8
34,149
0.78%
10.5
47,930
0.86%
9. TNS
8
32,995
0.75%
10
41,906
0.75%
10. Timken Bearings
7
29,207
0.67%
$ 2,135,085
38.27%
$ 1,704,934
38.84%
9. Timken Company
10. Springfield LLC
TOTAL
Total
Revenue
$ 896,890
% Gross
Revenue
16.07%
Customer
1. Nestle
FY 2004
Annual
Discharge
(MG)
339
Total
Revenue
$ 1,043,078
% Gross
Revenue
23.76%
Table 20
Debt Outstanding
Total
Revenue Debt
Outstanding
Fiscal
Year
2013
2012
2011
2010
2009
2008
2007
2006
2005
2004
$
Per
Capita (1)
8,600,000
9,475,000
10,325,000
11,150,000
11,435,000
12,170,000
12,875,000
13,545,000
8,700,000
9,090,000
As Share of
Personal
Income (2)
NA
$
169
186
201
209
224
239
252
163
170
NA
0.97%
0.69%
0.77%
0.82%
0.86%
0.93%
1.03%
0.69%
0.75%
(1) Per Capita is based on the Cherokee County population shown in Table 22.
(2) Share of Personal Income = Per Capita ÷ Per Capita Personal Income on shown Table 22.
N/A - Not Available
Total Debt Outstanding
$14,000,000
$12,000,000
$10,000,000
$8,000,000
$6,000,000
$4,000,000
$2,000,000
$2013 2012 2011 2010 2009 2008 2007 2006 2005 2004
Fiscal Year Ended
57
Table 21
Historical Statements of Revenues, Expenses, Debt Service and Debt Service Coverage
FY 2013
FY 2012
FY 2011
FY 2010
FY 2009
FY 2008
FY 2007
FY 2006
FY 2005
FY 2004
$ 33,421,376
$ 32,279,947
$ 31,646,737
$ 30,111,565
$ 28,740,445
$ 29,756,065
$ 27,327,898
$ 26,503,950
$ 25,655,009
$ 25,295,562
Net Income
Operating Revenues
Operating Expenses
(33,997,265)
(33,454,134)
(32,133,505)
(30,738,193)
(31,799,458)
(32,870,093)
(29,624,567)
(28,164,242)
(26,831,027)
(26,113,873)
(1,174,187)
(3,059,013)
(3,114,028)
(2,296,669)
(1,660,292)
(1,176,018)
(818,311)
1,134,852
1,171,071
Operating Income (Loss)
(575,889)
(486,768)
(626,628)
Nonoperating Revenues
86,905
68,417
109,895
219,855
479,885
Nonoperating Expenses
(432,030)
(460,598)
(487,513)
(474,706)
(567,335)
(584,477)
$
(921,014)
$ (1,566,368)
$
(864,386)
$
(881,479)
$ (3,146,463)
$
(921,014)
$ (1,566,368)
$
(864,386)
$
(881,479)
$ (3,146,463)
716,375
313,213
271,683
(640,842)
(395,645)
(462,209)
(474,461)
$ (2,563,653)
$ (1,766,440)
$ (1,339,562)
$ (1,325,014)
$ (1,021,089)
$ (2,563,653)
$ (1,766,440)
$ (1,339,562)
$ (1,325,014)
$ (1,021,089)
Net Income (Loss), Before
Capital Contributions and
Transfers Per Financial
Statements
Income Available for Debt Service
Net Income (Loss), Before
Capital Contributions and
58
Transfers Per Financial
Statements
Less: (Gain) loss on sale
of capital assets
Plus: Depreciation
Plus: Interest Expense
55,700
2,352
4,040,263
4,171,536
4,322,573
(36,820)
4,477,470
(33,018)
4,944,567
(63,206)
5,171,491
(55,851)
5,214,926
(26,635)
5,242,744
(16,439)
4,973,715
(33,602)
4,744,729
(2,294)
395,421
423,989
450,904
440,100
535,018
552,161
608,526
376,600
446,052
458,304
36,609
36,609
36,609
34,606
32,317
32,316
32,317
19,045
16,157
16,157
Plus: Amortization of
Bond Cost
Income Available for
Debt Service
$
3,606,979
$
3,068,118
$
3,908,880
$
4,037,679
$
2,302,233
$
3,136,464
$
4,062,694
$
4,282,388
$
4,077,308
$
4,195,807
Total System Debt Service
$
1,234,743
$
1,238,681
$
1,240,115
$
1,234,890
$
1,241,202
$
1,239,215
$
1,230,076
$
802,628
$
821,473
$
849,230
Total System
Debt Service Coverage
2.92
2.48
3.15
3.27
1.85
2.53
3.30
5.34
4.96
4.94
Table 22
Cherokee County, South Carolina
Demographic and Economic Statistics
Last Ten Years
Year (1)
Population (2)
Total
Personal
Income (2)
2012
56,033
NA
2011
55,540
2010
Per Capital
Personal
Income (2)
School
Enrollment (2)
Unemployment
Rate (3)
17,412
8,996
11.70%
$ 1,491,556,000
26,856
8,935
11.50%
55,342
1,470,297,000
26,142
9,142
15.70%
2009
54,714
1,414,022,000
25,640
9,356
16.10%
2008
54,394
1,437,508,000
26,146
9,362
7.20%
2007
53,933
1,392,813,000
25,572
9,308
6.50%
2006
53,752
1,320,442,000
24,378
9,322
7.40%
2005
53,496
1,271,464,000
23,645
8,922
6.30%
2004
53,410
1,223,309,000
22,805
8,979
9.30%
2003
53,250
1,177,881,000
22,042
8,989
8.70%
$
Notes:
(1)
(2)
(3)
NA
Calendar year
Provided by SC Appalachian Council of Governments - infoMentum
S.C. Employment Security Commission March (not seasonally adjusted)
Not available
59
Table 23
Cherokee County Major Employers
June 2012 and 2002-2003
Company or Organization
Nestle, USA
Cherokee Co. School District
Magnolia Finishing Co.
The Timken Company
Freightliner Custom Chassis
Hamrick Mills, Inc
Novant Health - Gaffney Medical
UPS Freight (Formerly Overnight)
Suminoe
Limestone College
Brown Packing Co. Inc.
Walmart Supercenter
Newark n One
ADS Logistics Services
SC State Budget & Control Board
Sanders Brothers
Springfield, LLC
National Textiles
June 2012 (1)
Percent of
Number of
Total County
Employees Rank Employment
1,300
1,231
809
712
650
425
400
376
375
369
330
259
257
200
186
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
5.17%
4.89%
3.21%
2.83%
2.58%
1.69%
1.59%
1.49%
1.49%
1.47%
1.31%
1.03%
1.02%
0.79%
0.74%
(1) Cherokee County Development Board and Individual Employers
(2) Infomentum/Appalachian Council of Governments
60
2002-2003 (2)
Percent of
Number of
Total County
Employees Rank Employment
1,481
1,165
730
1,000
1,300
444
440
1
3
6
4
2
8
9
6.03%
4.74%
2.97%
4.07%
5.29%
1.81%
1.79%
250
11
1.02%
235
850
344
12
5
10
562
7
0.96%
3.46%
1.40%
2.29%
Table 24
Schedule of User Charges
Residential Electric Service (General) – Rate Codes A, B, C, & G
Customer Facilities Charge
Energy Charge
First 1,000 KWH per month
All Over 1,000 KWH per month
$16.00 per bill per month
8.75 cents per kwh
8.37 cents per kwh
Residential All Electric Service – Rate Codes D & F
Energy Charge
8.75 cents per kwh
7.42 cents per kwh
Residential Water Service - Rate Codes O and P
Minimum Charges
Meter Size
5/8 x 3/4 inch
1 inch
1 1/2 inch
2 inch
Volume Charges
0 - 2,500 CF
2,501 - 25,000
All Over 25,000 CF
$
$
$
$
Inside City (O)
10.60
17.00
28.65
42.40
Per 100 CF
Inside City (O)
$
1.03
$
0.96
$
0.88
$
$
$
$
Outside City (P)
15.90
34.00
57.25
84.80
Per 100 CF
Outside City (P)
$
1.83
$
1.67
$
1.59
Residential Sewer Service – Rate Codes I & J
Minimum Charges
Meter Size
5/8 x 3/4 inch
1 inch
1 1/2 inch
2 inch
Volume Charges
Per CCF
$
$
$
$
Inside City (I)
10.60
18.05
31.80
45.60
Per 100 CF
Inside City (I)
$
1.99
61
$
$
$
$
Outside City (J)
15.90
36.05
63.60
91.20
Per 100 CF
Outside City (J)
$
2.70
Table 24 - Continued
Schedule of User Charges - Continued
Commercial Electric Service – Rate Codes H & J
Demand Charge Over 25KW
Energy Charge
6.80 per kw
10.45 cents per kwh
5.90 cents per kwh
Commercial Water Service – Rate Codes R & S
Minimum Charges
Meter Size
5/8 x 3/4 inch
1 inch
1 1/2 inch
2 inch
3 inch
4 inch
6 inch
8 inch
10 inch
12 inch
$
$
$
$
$
$
$
$
$
$
Inside City (R)
12.72
17.00
28.62
42.40
90.10
132.50
238.50
371.00
477.00
636.00
$
$
$
$
$
$
$
$
$
$
$
$
$
$
Per 100 CF
Inside City (R)
1.13
1.01
0.90
0.58
Per 100 CF
Outside City (S)
$
2.01
$
1.74
$
1.59
$
1.36
Volume Charges
0 - 2,500 CF
2,501 - 25,000 CF
25,001 - 500,000 CF
All Over 500,000 CF
Outside City (S)
25.45
33.95
57.25
84.80
180.20
265.00
477.00
742.00
954.00
1,272.00
Commercial Sewer Service – Rate Codes K & L
Minimum Charges
Meter Size
5/8 x 3/4 inch
1 inch
1 1/2 inch
2 inch
3 inch
4 inch
6 inch
8 inch
10 inch
12 inch
$
$
$
$
$
$
$
$
$
$
Inside City (K)
13.78
18.02
31.80
45.60
95.40
143.10
265.00
397.50
503.50
742.00
62
$
$
$
$
$
$
$
$
$
$
Outside City (L)
27.56
36.05
63.60
91.20
190.80
286.20
530.00
795.00
1,007.00
1,484.00
Commercial Sewer Service – Rate Codes K & L - continued
Volume Charges
Per CCF
Per 100 CF
Inside City (K)
$
2.17
Per 100 CF
Outside City (L)
$
2.97
Industrial Electric Service – Rate Code K
Demand Charge Over 25KW
Energy Charge
7.38 per kw
11.20 cents per kwh
6.18 cents per kwh
Industrial Electric Service – Rate Codes LC, I, & LR
Refer to Piedmont Power
Industrial Water Service – Rate Codes T & U
Minimum Charges
Meter Size
5/8 x 3/4 inch
1 inch
1 1/2 inch
2 inch
3 inch
4 inch
6 inch
8 inch
10 inch
12 inch
$
$
$
$
$
$
$
$
$
$
Inside City (T)
12.72
15.90
26.50
42.40
90.10
132.50
238.50
371.00
477.00
636.00
$
$
$
$
$
$
$
$
$
$
$
$
$
$
Per 100 CF
Inside City (R)
1.13
1.01
0.85
0.56
Per 100 CF
Outside City (S)
$
2.01
$
1.74
$
1.59
$
1.36
Volume Charges
0 - 2,500 CF
2,501 - 25,000 CF
25,001 - 500,000 CF
All Over 500,000 CF
63
Outside City (U)
25.45
31.80
68.90
84.80
180.20
265.00
477.00
742.00
974.00
1,272.00
Industrial Sewer Service - Rate Codes M & N
Minimum Charges
Meter Size
5/8 x 3/4 inch
1 inch
1 1/2 inch
2 inch
3 inch
4 inch
6 inch
8 inch
10 inch
12 inch
$
$
$
$
$
$
$
$
$
$
Inside City (M)
13.80
17.00
28.65
45.60
95.40
143.10
265.00
397.50
503.50
742.00
$
$
$
$
$
$
$
$
$
$
Outside City (N)
27.60
34.00
57.25
91.20
190.80
286.20
530.00
795.00
954.00
1,272.00
Volume Charges
Per CCF
$
2.17
$
2.97
Extra Strength Surcharges
*BOD
*COD
Suspended solids
NH3
$
$
$
$
Per Pound
0.410
0.175
0.270
0.398
*Charge for larger of two only
Water District Service – Rate Code W
Minimum Charges
Meter Size
5/8 x 3/4 inch
1 inch
1 1/2 inch
2 inch
3 inch
4 inch
6 inch
8 inch
10 inch
12 inch
$
$
$
$
$
$
$
$
$
$
21.20
31.80
53.00
84.80
180.20
265.00
477.00
742.00
954.00
1,272.00
Volume Charges
Per CCF
$
1.47
64
Outdoor Lighting Rates
Bills Rendered After 04/01/11
Lamp Rating in Lumens
7,950
21,000
* 9,500
9,500
16,000
27,500
38,000
50,000
140,000
115,000
4,000
7,500
Type of Luminaries
175 W Mercury Vapor, Suburban
400 W Mercury Vapor, Urban or Sub
100 W Sodium Vapor, Lucalox
400 W Metal Halide
1,000 W Sodium Vapor
1,000 W Metal Halide
Cost Per Month
$
10.00
$
22.50
$
10.00 *
$
20.25
$
21.50
$
25.50
$
36.00
$
42.50
$
83.50
$
71.00
Mercury Vapor, Post Top
Mercury Vapor, Post Top
$
$
22.00
27.00
* Rate applicable to residential customers only for required 175 Mercury Vapor phase-out
65
Table 25
Number of Employees
Fiscal
Year End
Full-Time
Employees
Part-Time
Employees
Total
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
81
78
78
79
76
72
72
73
71
68
7
8
9
8
8
9
7
5
5
8
88
86
87
87
84
81
79
78
76
76
Number of Employees
90
88
86
84
82
80
78
76
74
72
70
2004
2005
2006
2007
2008
66
2009
2010
2011
2012
2013
Table 26
Operating and Capital Indicators
67
2013
2012
2011
2010
2009
2008
2007
2006
2005
2004
Electrical System
Size of Service Area (sq. miles)
Number of Substations
Number of Circuits
Miles of Underground Service
Miles of Overhead Service
Miles of Fiber Optic Line
24
6
18
51.5
137
38
24
6
18
51.5
137
38
24
6
18
50.5
137
38
24
6
18
49.57
136.2
38
24
6
18
47.75
136.2
38
24
6
18
47
136
35
24
6
18
46
135
28
24
6
18
45
135
28
24
6
18
44
134
27
24
6
18
43
134
24
Water Treatment
Size of water shed (sq. miles)
Water storage capacity (MG)
Miles of Water Mains
Number of Treatment Plants
Treatment Capacity (MGD)
Amount Treated Annually (MG)
Unused Capacity (MG)
Percentage of Capacity Utilitized
14.52
8.1
291.8
2
18
2265
4305
34%
14.52
8.1
291.47
2
18
2327
4243
35%
14.52
8.1
288.43
2
18
2249
4321
34%
14.52
8.1
288.43
2
18
2253
4317
34%
14.52
8.1
285.25
2
18
2312
4258
35%
14.52
8.1
285
2
18
2588
3982
39%
14.52
8.1
280
2
18
2587
3983
39%
14.52
8.1
276
2
18
2573
3997
39%
14.52
8.1
276
2
18
2558
4012
39%
14.52
8.1
272
2
18
2500
4070
38%
Wastewater Treatment
Miles of Sewer Mains
Number of Pump Stations
Number of Treatment Plants
Treatment Capacity (MGD)
Amount Treated Annually (MG)
Unused Capacity (MG)
Percentage of Capacity Utilitized
163
12
2
9
1228
2057
37%
163
12
2
9
1247
2038
38%
163
12
2
9
1202
2083
37%
163
12
2
9
1296
1989
39%
163
12
2
9
1144
2141
35%
163
12
2
9
1330
1955
40%
162
12
2
9
1501
1784
46%
162
12
2
9
1631
1654
50%
162
12
2
9
1543
1742
47%
162
12
2
9
1587
1698
48%

Senior Management Staff - Gaffney Board of Public Works

Transcription

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