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GMA adopts new fiscal reserve policy to set floors, ceilings and categories for agency funds
Summary
The Groundwater Management Agency adopted a fiscal reserve policy establishing three reserve categories—working capital, rate stabilization and water‑supply sustainability—and specified floors/ceilings intended to provide predictability for operations and rates.
The Groundwater Management Agency board on a unanimous vote of members present adopted a new fiscal reserve policy that creates three distinct reserve categories and establishes rules for their use.
Staff described the policy as replacing prior, less‑structured carryforward reserves with a framework intended to smooth operations, stabilize rates and fund longer‑term water‑supply projects. The three categories are: a working capital reserve to cover day‑to‑day cashflow between semiannual invoicing cycles; a rate‑stabilization reserve to insulate ratepayers from short‑term revenue fluctuations; and a water‑supply sustainability reserve for projects, purchases of water and studies to support basin sustainability.
John, the agency’s executive officer, told the board that ‘‘we mailed them out in 304 notices mailed, 79 were returned,’’ as an example of ongoing operational challenges prompting the policy’s clarification of responsibilities and outreach. He said the policy was developed with input from the fiscal committee and benchmarking of similar special districts.
Board members pressed staff for detail on how funding would be proportioned between the reserves, who sets floors and ceilings and how the agency will communicate the changes to ratepayers. Director Lynn Muller urged that the fiscal committee perform a deep dive on the guardrails before full implementation; staff pointed to packet exhibits (pages 26–30) that specify floor/ceiling targets and said the board sets those levels, with staff recommending targets based on benchmarking and prior years’ operations.
The board approved the policy to take effect for the next fiscal year (budget year 26/27). The motion carried with all seated members voting in favor and one director noted absent from the roll call.
