Proposed code would isolate long-term projects such as Lake Hodges from regular capital reserves

Finance Manager Aguilar told the board a key change to the district's reserve policy would distinguish long-term projects from other capital projects when calculating reserve targets. Aguilar used Lake Hodges as an example: "for Lake Hodges, we do set aside money every year for unforeseen future anticipated costs around the dam," and staff proposed a separate category so those set-asides would not inflate the regular capital-replacement reserve target.

Aguilar said such reserve-target changes would be visible in the district's annual budget adoption in June, and board members acknowledged that separating long-term project funding from routine capital reserves could make reserve accounting clearer. The board did not take a vote at this meeting; staff plans to return with the formal adoption item in September and any budget modifications will be processed through the normal budget cycle.