Preliminary Financial Impact Analysis   De-Annexation
August 2019
Given the potential Rainbow Municipal Water District (RMWD) and Fallbrook Public Utility District
(FPUD) de-annexation from the San Diego County Water Authority, Water Authority staff performed a
preliminary financial assessment to determine an initial order-of-magnitude financial impact. This highlevel analysis calculates the potential net revenue loss and re-allocation of costs to remaining member
agencies to meet necessary annual revenue requirements.
To provide a baseline estimate, the preliminary analysis uses a mix of FY 2018 actual data and CY 2020
adopted rates and charges, which reflects the best available data at this time. The values and impacts
presented herein reflect a reasonable 1-yr estimate. It is important to note that the estimated impact is
likely to fluctuate year-to-year based on updated assumptions, financials, and demands.

 Table 1 defines the forecasted financial (revenue and expenditure) impacts related to RMWD and FPUD.
Table 1: Preliminary De-Annexation Net Impact

Anticipated Avoided Costs
Avoided Supply Purchases
Avoided Treatment Expense
Avoided SDCWA O&M
Total Avoided Costs
Anticipated Revenue Loss
Supply Reliability Charge
Customer Service Charge
Storage Charge
Infrastructure Access Charge
Melded Supply Rate
Melded Treatment Rate
Transportation Rate
Other Revenue (1)
Total Anticipated Revenue
Net Impact

Forecasted Impact ($)
$22,268,000
$9,526,600
$0
$31,794,600
$1,594,400
$1,691,700
$2,787,700
$1,165,700
$25,391,300
$8,258,300
$1,292,800
$2,979,800
$45,161,700
-$13,367,100

(Avoided Expense - Revenue Loss)
(1) Includes Property Tax, Standby Charge, and Capacity Fees (FY 2018)

 Table 2 provides a break down of revenues by rate component (fixed, transportation, melded supply,
and melded treatment) and reflects the projected revenue loss based on Rainbow and Fallbrook’s
specific use of the system and benefit of the SAWR program and that not all deliveries are subject to the
Water Authority’s Transportation Rate. For simplicity, the Melded Treatment Impact was allocated over
total deliveries (not just treated).
Table 2: Revenue Impact by Rate Category
Fixed Charge Impact
Revenue Loss (from Table 1)
Transportation Rate Impact
Revenue Loss
CY 2020 Deliveries (less R&F)
Rate Impact
Melded Supply Impact
Revenue Loss (Supply)
Revenue Loss (Other Revenues)
CY 2020 Deliveries (less R&F)
Rate Impact
Melded Treatment Impact
Revenue Loss
CY 2020 Deliveries (less R&F)
Rate Impact
Variable Rate Impact
Transportation Rate
Melded Supply Rate
Treatment Rate
Total Volumetric Rate Impact

CY2020
$7,239,552
$1,292,800
367,819
$3.51
$3,123,300
$2,979,800
367,819
$16.59
($1,268,200)
367,819
($3.45)
$3.51
$16.59
($3.45)
$16.66

The Net Impact (Table 1) and Total Revenue Recovery (Table 3) do not match, due to the use of different
delivery assumptions (CY 2020 vs FY 2018) throughout. In addition, the values presented in Table 3
reflect the use of FY 2018 Actuals for “Other Revenues” rather than an initial staff input. As such, these
values are lower by $37,847 than from delivered impacts (provided on 8/5/2019). Some of the
difference also reflects the use of non-rounded values.

 Table 3: Estimated Recovery of Net Impact (De-Annexation)

Carlsbad M.W.D.
Del Mar, City of
Escondido, City of
Fallbrook P.U.D.
Helix W.D.
Lakeside W.D.
Oceanside, City of
Olivenhain M.W.D.
Otay W.D.
Padre Dam M.W.D.
Pendleton Military Reserve
Poway, City of
Rainbow M.W.D.
Ramona M.W.D.
Rincon Del Diablo M.W.D.
San Diego, City of
San Dieguito W.D.
Santa Fe I.D.
Sweetwater Authority
Vallecitos W.D.
Valley Center M.W.D.
Vista I.D.
Yuima M.W.D.
South Coast W.D.
Total

Supply
Customer
Storage
IAC
Reliability
Service
Charge
Charge
Charge
$59,164
$57,510
$100,517
$47,104
$3,999
$4,274
$7,471
$3,234
$69,358
$78,315
$120,848
$45,932
$0
$0
$0
$0
$114,229
$111,392
$194,690
$84,672
$11,635
$11,449
$20,010
$10,754
$88,210
$93,010
$160,295
$74,551
$75,803
$77,583
$134,915
$36,672
$117,569
$120,429
$210,484
$77,746
$39,888
$41,488
$71,141
$34,832
$240
$288
$502
$0
$40,846
$39,414
$68,622
$22,130
$0
$0
$0
$0
$17,832
$21,982
$30,389
$13,341
$22,211
$22,251
$38,696
$13,098
$686,275
$694,117 $1,211,896
$510,938
$17,597
$15,369
$26,861
$19,539
$32,280
$28,384
$49,609
$13,651
$44,661
$41,472
$72,485
$55,901
$52,276
$53,599
$87,412
$35,275
$31,614
$91,490
$56,181
$19,048
$64,287
$66,589
$116,011
$46,525
$3,848
$20,829
$8,712
$784
$558
$466
N/A
N/A
$1,594,380 $1,691,700 $2,787,744 $1,165,728

Estimated
Fixed Charge
Impact
$264,295
$18,979
$314,453
$0
$504,983
$53,848
$416,067
$324,973
$526,227
$187,349
$1,030
$171,012
$0
$83,544
$96,257
$3,103,225
$79,365
$123,924
$214,519
$228,561
$198,332
$293,412
$34,172
$1,025
$7,239,552

FY 2018
Deliveries

Est. Variable
Impact

Total Estimated
Impact

16,032
1,078
7,869
N/A
25,913
2,836
22,510
19,423
29,638
10,332
84
10,316
N/A
5,379
5,468
155,923
2,660
5,818
1,735
16,168
22,526
2,530
6,088
370,326

$267,873
$18,012
$131,480
$0
$432,971
$47,386
$376,112
$324,532
$495,211
$172,634
$1,404
$172,366
$0
$89,876
$91,363
$2,597,581
$44,445
$97,211
$28,990
$270,145
$376,379
$42,273
$101,722
$0
$6,169,404

$531,378
$36,938
$445,545
$0
$936,678
$101,094
$791,070
$648,548
$1,019,978
$359,474
$2,429
$342,870
$0
$173,154
$187,350
$5,700,807
$123,679
$220,848
$243,423
$497,910
$573,601
$335,560
$135,594
$1,025
$13,408,953

(AF)

(AF * $16.66)

(Fixed + Variable)