SUBJECT/RECOMMENDATION:
Title
Clearwater Gas System (CGS) Fiscal Year 18/19 Dividend to the City General Fund Report and request for transfer back of $60,264 to the CGS Operating Fund to reimburse for repairs to the old Countryside Library roof and A/C. (consent)
Body
SUMMARY:
By City Council policy, CGS commits to pay an Annual Dividend of at minimum $1,700,000 to the City’s General Fund. After the city books close for the year, the Gas System calculates the Annual Adjusted Dividend payment to return ½ of its annual Net Income less debt service interest as a dividend to the City in the following year. CGS’ financial performance for Fiscal Year 17/18 exceeded its plan; therefore, CGS will actually pay a Fiscal Year 18/19 dividend of $3,205,274, an increase of $1,505,274 above the minimum annual dividend payment to the City, which is an increase of $705,274 above the original Fiscal Year 18/19 budget of $2,500,000.
Additionally, CGS incurred several unexpected expenses for repairs to the old Countryside Library building, which the CGS Sales and Drafting & Design personnel are temporarily utilizing during the re-construction of the CGS Complex. This included roof repairs of at a cost of $30,730 and replacement of 2 A/C units at a cost of $29,534. CGS is requesting that the City Council authorize the transfer of $60,264 from these beforementioned excess dividend monies to the CGS General Fund to reimburse for these unexpected expenses.
This will still leave remaining unexpected Council Dividend funds of $645,010.