July 19, 2023
The West Basin Municipal Water District budget for the new fiscal year 2023-2024 (FY 2023-24), beginning July 1, 2023 and ending June 30, 2024, is now available online.
The FY 2023-24 budget supports the achievements of key financial metrics, strategic business plan goals, ongoing program activities, key business decisions, and long-term commitments to ensure that West Basin delivers safe and reliable water to the communities it serves.
A significant component of the budget is dedicated to local water supply and investment in replacing aging recycled water infrastructure to ensure that our customers receive the quantity, quality, and reliability of this drought-resilient resource.
The following are highlights from the FY 2023-24 budget:
- The budgeted total operating expense for FY 2023-24 is $244.1 million, representing an increase of $8.2 million (3.5%) from the prior fiscal year.
- Since many residents responded to the call for conservation during the most recent drought by taking advantage of various water use efficiency incentive programs, retail imported water sales are not expected to return to previous levels. As a result, imported retail sales are budgeted at 95,000 AF.
- Staff anticipates relatively flat recycled water sales of 33,032 AF in FY 2023-24 (compared to 32,643 AF in FY 2022-23). West Basin adopted recycled water rates to increase according to customer agreements, or to align more closely to the unit cost to produce recycled water, depending on the type of recycled water. The result is an increase of $3.6 million in operating revenue. Expected recycled water sales are comprised of approximately 26% for seawater barrier protection, 58% for industrial use by local refineries, and 16% for irrigation use at parks, golf courses, schools, street medians, and other public green spaces.
- Other revenues include approximately $7.3 million in customer and capital grant funding for capital improvement projects, and another $1 million for estimated external contributions for certain technical planning projects.
- The Recycled Water Operations program faced one of the most significant increases in expenditures to produce recycled water. It was especially impacted by unavoidable increases in chemical cost, which is budgeted to grow by $135/AF, or a $4.4 million dollar increase in FY 2023-24. Utilities, which includes the cost of electricity, have also seen an increase of approximately $15/AF.
- The Technical Planning program provides strategic, long-term planning of projects. The FY 2023-24 Technical Planning program budget includes expenditures of $5.2 million, a $0.7 million increase from FY 2022-23, for projects that re-envision water recycling as a regional water supply and reduce the region’s reliance on imported water.
- West Basin’s Capital Improvement Program (CIP) budget for all planned capital expenditures for FY 2023-24 are anticipated to be approximately $38.8 million, with more than $114.3 million in planned expenditures for the next four fiscal years. The CIP budget includes $19.0 million for identified Refurbishment & Replacement (R&R) projects.
- New infrastructure and customer development pipelines are predominantly comprised of two construction projects totaling $18.8 million. The first completes the expansion at West Basin’s Juanita Millender-McDonald Carson Regional Water Reclamation Plant. This CIP project includes installation of a 5.88 MGD custom engineered microfiltration (CEMF) system and improves reliability and redundancy. The second project requires West Basin to construct a nearly four-mile recycled water pipeline with six connections in the City of Torrance and Palos Verdes Estates.
West Basin is committed to sound financial management and cost containment measures to ensure that rate adjustments are mitigated to the greatest extent possible while continuing to ensure a safe and reliable water supply.