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UPC hears audited financial results: unqualified opinion and $13 million in federal assistance audited with no findings
Summary
Committee members reviewed the water fund quarterly financials and an audit showing an unqualified opinion; the single-audit of federal grant compliance found no significant deficiencies and covered about $13 million in federal assistance tied to drinking-water projects.
The Utility Policy Committee reviewed quarterly financial materials and an audit summary on July 10. Staff presented operations and revenue data showing operations at roughly 33% of budget after six months and revenue at about $16 million of a $41 million budget (~38%), noting billing timing and accrual lags.
Staff highlighted a substantial one-time-like revenue component: a system-capacity buy-in that totaled nearly $400,000 in the year shown and was recorded at a modeled $11.75 per unit. The presenter walked the committee through expense and revenue comparisons between 2024 and 2025 and explained some expense increases were timing or project-driven (capital timing, meter replacements) rather than structural overspending.
On audits, staff reported the external auditors issued an unqualified opinion on the financial statements and that the single-audit of federal grant compliance identified no significant deficiencies, material weaknesses or findings. The transcript identified approximately $13,000,000 of federal financial assistance on the schedule of expenditures of federal awards, associated with drinking-water revolving fund proceeds; that assistance was audited without findings.
Debt-service coverage for the year was reported at about 2.3 times, which exceeds the committee’s financial-policy minimum coverage of 1.4 times. Staff said they would provide more detailed spreadsheets and can arrange for the external auditors to present to UPC if the committee requests it.
