The Power of Streamlined Modeling for Water Utilities – 2024 Virtual Solutions Summit

The Power of Streamlined Modeling for Water Utilities

Timestamps

Eastern Municipal Water District | Session Overview:

Speakers:
Donna Kiminki | Financial Manager
Kendra Sotelo | Senior Financial Analyst
Rebeca Robles | Financial Analyst II

  • 0:12 – Speaker Introductions for Eastern Municipal Water District
  • 2:06 -Eastern Municipal Water District (EMWD) Overview
  • 2:13 – Development and Financial Structure of EMWD
  • 3:14 – Long-Term Financial Planning and Growth Expectations
  • 5:00 – Capital Improvement Program and Strategic Plan
  • 8:30 – Water Sources and Supply
  • 11:30 – Financial Planning and Rate Setting
  • 13:21 – Water Rates and Customer Usage
  • 16:30 – Sewer Rates and Capital Projects
  • 17:30 – Capital Improvement Program Projections
  • 19:30 – Long-Term Financial Planning and Financial Model Benefits
  • 25:00 – Detailed Financial Projections and Assumptions
  • 44:10 – Q&A

Eastern Municipal Water District's Modeling Journey

The presentation by Eastern Municipal Water District (EMWD) at the Synario Summit provided a comprehensive overview of their financial planning and the integration of the Synario platform into their operations. EMWD, located in Southern California, was established in 1950 and provides water, wastewater, and recycled water services to nearly 1 million people across 601 square miles.

The district is managed by a five-member publicly elected board of directors. For the fiscal year 2024-2025, EMWD has an annual budget of $619 million, with a significant capital improvement program (CIP) of $785 million over the next five years.

Water treatment recycling plant

The Switch to Synario

EMWD began using Synario to streamline their financial planning processes. The goal of this endeavor was managing their extensive financial planning needs, including budgeting, rate development, and long-term forecasting.

They previously relied on Excel spreadsheets with over 50 tabs, which were cumbersome, prone to errors, and time-consuming. The district needed to comply with California’s Proposition 218, which requires transparency and proportional cost allocation for services. Additionally, managing over 200 active capital projects required accurate long-term financial planning to avoid rate spikes and ensure funding.

EMWD's Water Utility Modeling Improves

The team at EMWD uses Synario to reduce the potential for errors by automating calculations and integrating changes across the model. Synario allows EMWD to quickly create and compare different financial scenarios, such as varying rate increases or changes in capital project funding. Real-time adjustments can be made during meetings, significantly reducing the time required to generate financial projections from a week to mere hours.

The ability to generate a detailed breakdown of revenue and expenses, including specific rates for different water types and seasonal variations was particularly helpful for a California-based water utility as they look and plan ahead for seasonal fluctuations and potential drought.

Due to the scale of their capital improvement plan, the team is very excited about the capabilities to automate debt needs calculations based on project costs, internal reserves, and targeted days cash on hand, ensuring accurate debt service projections.

Previously, generating comprehensive reports and the associated visuals would take a week or more, after implementing Synario, the team at EMWD expects the process to take hours.

“The EMWD model with Synario gives us accuracy, agility, gives us scenarios, and all of that allows us to identify all of the driving structures of that strategic plan like capital planning and cash flow projections, revenue requirements, rate stability, debt funding needs, and reserve utilization.”

– Donna Kiminki, Financial Manager, Eastern Municipal Water District

Strategic Planning for Water Utilities and Future Outlook

The team at Eastern Municipal Water District helps the utility organization with it's mission of managing it's three-year strategic plan. Synario has proved capable of helping this process in a few ways.