Final 2015 Report on Operations - Levees.Org · 2017. 8. 20. · BLACK & VEATCH PROJECT NO. 192043...

REPORT ON OPERATIONS FOR 2015 BLACK & VEATCH PROJECT NO. 192043

PREPARED FOR

Sewerage and Water Board of New Orleans

20 OCTOBER 2016

©Black & Veatch Holding Company 2015. A

ll rights reserved.

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MISSION STATEMENT

OurmissionistoprovidesafedrinkingwatertoeveryoneinNewOrleans;Toremovewastewaterforsafereturntotheenvironment;

Todrainawaystormwater;Toprovidewaterforfireprotection;

Toprovideinformationaboutproductsandservices;Andtodoallofthiscontinuouslyatareasonablecosttothecommunity

VISION STATEMENT

Ourvisionistohavethetrustandconfidenceofourcustomersforreliableandsustainablewaterservices

OUR VALUES

WewillfocusonourcustomersandstakeholdersWewilltreateachcustomerandemployeewithdignityandrespectWewillvalueeachemployee,theirwork,andtheircommitment

Wewillbetruthful,trustworthyandtransparentWewillbeknowledgeableanddiligentintheperformanceofourduties

WewillusefinancialresourcesprudentlyWewillbeaccountableforourperformance

WewillcontinuouslyimproveourperformanceWewillensurethatthesystemsthatprovideourservicesremainviableforfuturegenerations

Wewillremainonthejobandwillbepreparedforstormsandotherrisks

BLACK & VEATCH CORPORATION 8400 WARD PARKWAY, KANSAS CITY, MO 64114 +1 913‐458‐3363| [email protected]

www.bv.com

October20,2016

Sewerage&WaterBoardofNewOrleans625St.JosephStreetNewOrleans,LA70165

DearBoardMembers:

Inaccordancewithouragreement,wearesubmittingthisReportonOperationsoftheWater,Sewerage,andDrainageDepartmentsfortheyear2015.ThereportpresentsthefindingsofouranalysistoconfirmcompliancewiththecovenantsoftheGeneralWaterRevenueBondResolutionandtheGeneralSewerageRevenueBondResolution.

Thereportalsocontainsprojectionsofexpectedfuturefinancialactivityforthethreedepartmentsfortheperiod2016through2020.TheseprojectionsarebaseduponhistoricaltrendsandtheBoard’soperatingandcapitalbudgets.Projectedcostsincludeanallowanceforanticipatedfuturepriceinflation.

Wewishtoacknowledgethecooperationandassistanceofutilitystaffinprovidingguidanceandinformationforthestudy.

WeappreciatetheopportunitytobeofservicetotheSewerageandWaterBoard.

Verytrulyyours,BLACK&VEATCHCORPORATION

AnnaWhitePrincipalConsultantEnclosure

Sewerage and Water Board of New Orleans | REPORT ON OPERATIONS FOR 2015

BLACK & VEATCH | Table of Contents i

Table of Contents TableofContents..........................................................................................................................................i

Introduction.................................................................................................................................................1

PurposeandScope..................................................................................................................................................1

Definitions...................................................................................................................................................................1

History..........................................................................................................................................................................1

WaterDepartment.............................................................................................................................................2

SewerageDepartment......................................................................................................................................2

DrainageDepartment........................................................................................................................................3

General....................................................................................................................................................................4

SourcesofFinancialData.....................................................................................................................................5

SummaryofFindings.............................................................................................................................................5

WaterDepartment.............................................................................................................................................5

SewerageDepartment......................................................................................................................................6

DrainageDepartment........................................................................................................................................7

OtherFindings......................................................................................................................................................7

FacilitiesEvaluation‐Operation,Maintenance,andReconstruction.....................................9

Introduction...............................................................................................................................................................9

Staffing......................................................................................................................................................................10

WaterPurificationPlants..................................................................................................................................11

CarrolltonWaterPurificationPlant.........................................................................................................11

AlgiersWaterPurificationPlant................................................................................................................13

WaterQualityLaboratory.................................................................................................................................14

WaterPumpingandPower...............................................................................................................................15

CentralControl..................................................................................................................................................16

SewageTreatmentPlants..................................................................................................................................17

EastBankSewageTreatmentPlant.........................................................................................................17

WestBankSewageTreatmentPlant........................................................................................................19

SewerageandDrainagePumpingStations................................................................................................21

FacilityMaintenance...........................................................................................................................................21

Engineering.............................................................................................................................................................22

Networks..................................................................................................................................................................24

SupportServices...................................................................................................................................................25

EnvironmentalAffairs.........................................................................................................................................26

StatusofConsentDecreeforSewerageSystem.......................................................................................28

SummaryofFindings..........................................................................................................................................28

WaterDepartment...................................................................................................................................30

REPORT ON OPERATIONS FOR 2015 | Sewerage and Water Board of New Orleans

ii OCTOBER 2016

AdherencetoWaterRevenueBondResolutionRequirements.........................................................30

PaymentofIndebtedness;LimitedObligations...................................................................................30

LimitationsonIndebtedness.......................................................................................................................30

CovenantsandRepresentationsofBoard..............................................................................................30

CovenantswithCreditBanks,Insurers,etc...........................................................................................30

OperationandMaintenance.........................................................................................................................30

FreeService,CompetingService,BillingandEnforcementofCharges......................................31

SaleorEncumbranceofSystem.................................................................................................................31

Insurance.............................................................................................................................................................31

Damage,Destruction,CondemnationandLossofTitle....................................................................31

RecordsandAccounts;InspectionsandReports................................................................................31

CapitalBudget....................................................................................................................................................32

2015WaterDepartmentOperations.............................................................................................................32

WaterUse.............................................................................................................................................................32

OperatingRevenues........................................................................................................................................32

Non‐OperatingRevenues..............................................................................................................................33

OperationandMaintenanceExpenses....................................................................................................33

CapitalBudgetandExpenditures..............................................................................................................33

SummaryofOperations.................................................................................................................................33

ProposedCapitalImprovementProgram...................................................................................................34

AbilitytoFinanceProposedCapitalExpenditures..................................................................................34


OtherRevenueSources..................................................................................................................................34


DebtServiceRequirements..........................................................................................................................35

AdequacyofRevenuestoFinanceProposedCapitalImprovements..........................................35

SewerageDepartment............................................................................................................................52

AdherencetoSewerageServiceRevenueBondResolution................................................................52

2015SewerageDepartmentOperations.....................................................................................................52

WastewaterVolumes......................................................................................................................................52


Non‐OperatingRevenues..............................................................................................................................53



SummaryofOperations.................................................................................................................................54


AbilitytoFinanceProposedCapitalExpenditures..................................................................................54


BLACK & VEATCH | Table of Contents iii


OtherRevenueSources.................................................................................................................................54

OperationandMaintenanceExpense......................................................................................................55

DebtServiceRequirements.........................................................................................................................55

AdequacyofRevenuestoFinanceProposedCapitalImprovements.........................................55

DrainageDepartment.............................................................................................................................71

2015DrainageDepartmentOperations......................................................................................................71

Revenues.............................................................................................................................................................71



SummaryofOperations................................................................................................................................72


AbilitytoFinanceProposedCapitalExpenditures.................................................................................72

Revenues.............................................................................................................................................................72


DebtServiceRequirements.........................................................................................................................73

AdequacyofRevenuestoFinanceProposedCapitalImprovements.........................................73

Appendix......................................................................................................................................................87


iv OCTOBER 2016

LIST OF TABLES Table1 InsuranceinForceasofDecember31,2015..........................................................................39

Table2 WaterDepartment–HistoricalandProjectedSalesandAverageNumberofCustomers..............................................................................................................................................40

Table3 WaterDepartment–ExistingWaterRates..............................................................................41

Table4 WaterDepartment–StatementofHistoricalRevenues.....................................................42

Table5 WaterDepartment–HistoricalOperationandMaintenanceExpenses......................43

Table6 WaterDepartment–CapitalExpenditures‐2015...............................................................44

Table7 WaterDepartment–ProposedCapitalImprovements......................................................45

Table8 WaterDepartment–ProjectedOperatingRevenues..........................................................46

Table9 WaterDepartment–ProjectedOperationandMaintenanceExpense.........................47

Table10 WaterDepartment–DebtServiceRequirements.................................................................48

Table11 WaterDepartment–CapitalImprovementProgramFinancing.....................................49

Table12 WaterDepartment–AnalysisofAbilityofForecastedRevenuestoFinanceProjectedRevenueRequirements...............................................................................................50

Table13 WaterDepartment–CoverageRequirements.......................................................................51

Table14 SewerageDepartment–HistoricalandProjectedBilledVolumesandAverageNumberofCustomers.......................................................................................................................59

Table15 SewerageDepartment–ExistingSewerRates.......................................................................60

Table16 SewerageDepartment–StatementofHistoricalRevenues.............................................61

Table17 SewerageDepartment–HistoricalOperationandMaintenanceExpenses...............62

Table18 SewerageDepartment–CapitalExpenditures‐2015........................................................63

Table19 SewerageDepartment–ProposedCapitalImprovements...............................................64

Table20 SewerageDepartment–ProjectedOperatingRevenues...................................................65

Table21 SewerageDepartment–ProjectedOperationandMaintenanceExpense.................66

Table22 SewerageDepartment–DebtServiceRequirements..........................................................67

Table23 SewerageDepartment–CapitalImprovementProgramFinancing..............................68

Table24 SewerageDepartment–AnalysisofAbilityofForecastedRevenuetoFinanceProjectedRevenueRequirements...............................................................................................69

Table25 SewerageDepartment–CoverageRequirements................................................................70

Table26 DrainageDepartment–HistoricalRevenuesReceived......................................................77

Table27 DrainageDepartment–HistoricalOperationandMaintenanceExpenses................78

Table28 DrainageDepartment–CapitalExpenditures‐2015.........................................................79

Table29 DrainageDepartment–ProposedCapitalImprovements................................................80

Table30 DrainageDepartment–ProjectedParticipationbyOthers..............................................81

Table31 DrainageDepartment–ProjectedOperatingRevenues.....................................................82

Table32 DrainageDepartment–ProjectedOperationandMaintenanceExpenses.................83

Table33 DrainageDepartment–DebtServiceRequirements...........................................................84


BLACK & VEATCH | Table of Contents v

Table34 DrainageDepartment–CapitalImprovementProgramFinancing..............................85

Table35 DrainageDepartment–AnalysisofAbilityofForecastedRevenuetoFinanceProjectedRevenueRequirements..............................................................................................86

LIST OF FIGURES Figure1–CarrolltonWaterPurificationPlant.............................................................................................12

Figure2–AlgiersWaterPurificationPlant....................................................................................................14

Figure3–EastBankSewageTreatmentPlant..............................................................................................17

Figure4–WestBankSewageTreatmentPlant............................................................................................19


BLACK & VEATCH | Introduction 1

Introduction

PURPOSE AND SCOPE ThisreportcoversoperationsoftheSewerageandWaterBoardofNewOrleansfortheyearendedDecember31,2015.Thisreportpresentsfindingsofstudiesmadeincompliancewithcovenantsofthe2014GeneralWaterRevenueBondResolutionandthe2014GeneralSewerageServiceRevenueBondResolution.ThisreportalsoincludesrecommendationsdesignedtoassisttheSewerageandWaterBoardofNewOrleansanditsstaffinplanningfutureoperationalpolicies.Subjectscoveredincludethefollowing:

1. AdherencetocovenantsoftheGeneralWaterRevenueBondResolutionandtheGeneralSewerageServiceRevenueBondResolution.

2. Abilitytofinanceprojectedrevenuerequirementsincludingproposedcapitalimprovements.

3. Operationsofthewater,sewerage,anddrainagesystems.

DEFINITIONS Inthisreport,“SewerageandWaterBoardofNewOrleans,”“SewerageandWaterBoard,”and“Board”areusedsynonymously.“GeneralResolution”referstoeitherthe2014GeneralWaterRevenueBondResolutionor2014GeneralSewerageServiceRevenueBondResolution.

“WaterDepartment”istheSewerageandWaterBoardorganizationprovidingdomesticwaterservicetoresidentsoftheCityofNewOrleans.“SewerageDepartment”istheorganizationprovidingwastewaterservice,and“DrainageDepartment”istheorganizationprovidingstormwaterconveyanceandpumping.TheBoardorganizationincludessomegroupswhoparticipateintwoormoreoperationalactivities.

HISTORY TheSewerageandWaterBoardofNewOrleanswascreatedbyActNo.6oftheLouisianaLegislaturein1899asaspecialboardindependentofCitygovernmenttodevelop,operate,andmaintainthewaterandseweragesystemsintheCityofNewOrleans.In1903,theLouisianaLegislaturegavecontroloftheCity’sdrainagesystemtotheBoard.Sincethattime,growthoftheserviceareaandincreasedservicerequirementshaveexpandedthemagnitudeandcomplexityofoperations.

Availablesourcesoffundspriorto1958forfinancingutilityoperationsandimprovementsincludedadvaloremtaxes,contributions‐in‐aid‐of‐construction,generalobligationbondsoftheCityofNewOrleans,andwaterrevenues.

In1974,theAmericanInstituteofCertifiedPublicAccountantsexpandedtheirreportingguidelinesforgovernmentoperatedutilitiestoincludedepreciationaccounting.Asaresult,theBoardinitiatedapreliminarysystemofaccountingrecognizingestimatedhistoricalinvestmentasabasisforannualdepreciationaccruals.Implementationofthedetailedplantaccountingandrecordkeepingrequiredwasstartedin1979.

TheBoard’scomputerbasedbudgetcodesystemprovidesamethodofidentificationofoperationandmaintenanceexpensesfortheWater,Sewerage,andDrainageDepartments.Allocationof


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expensesisbaseduponactualordirectexpensesofeachDepartmenttogetherwithanapportionmentofjointexpenses.TheprocedurespermitutilityplantaccountingwithannualcostschargedtotheappropriatepropertyaccountinsteadofbeingchargedtocurrentDepartmentincome.Inaccountingfordebtservice,interestischargedtocurrentyear’sincomeandprincipalanddebtservicereservepaymentsarechargedtotherespectiveaccountbalances.Historicaloperatingcosts,discussedlaterinthisreport,reflectthefunctionalclassifications.

Water Department

ActNo.541increasedtheBoard’sabilitytofinanceneededwatersystemimprovementsbyauthorizingtheBoardtoissuewaterrevenuebonds.Subsequently,waterrevenuebondsintheamountsof$6,200,000in1960,$1,500,000in1961,$2,500,000in1964,$4,000,000in1971,$6,000,000in1978,$17,000,000in1980,$3,000,000in1981,and$5,000,000in1982wereissued.Allwatersystemrevenuebondsoutstandingin1986weredefeasedbythe$31,350,000Series1986WaterRevenueRefundingbondissue.Additionalrevenuebondsintheamountof$16,000,000wereissuedin1998and$34,000,000wereissuedin2002.In2014,theBoardissuedWaterRevenueandRefundingBondsintheamountof$103,525,000.AportionoftheproceedswereusedtodefeaseSeries1998intheamountof$5,570,000andSeries2002intheamountof$22,085,000.In2015,theBoardissuedWaterRevenueBondsintheamountof$100,000,000.Principalpaymentswillbeginin2018.AsofDecember31,2015,totaloutstandingdebtserviceonalloutstandingrevenuebondstotaled$203,525,000.

ActNo.566reauthorizedtheBoardtofixandadministerascheduleofwaterratestomeettheoperationalandcapitalcostsofthepublicwatersystem,toissuewaterrevenuebonds,andtodiscontinuethefreewaterallowanceforseweragepurposeseffectiveNovember9,1966.

Sewerage Department

ActNo.567gavetheBoardauthoritytosetandcollectsewerageservicechargestobeusedforoperationalandcapitalcostsoftheSewerageDepartment,andtoissuesewerageservicerevenuebonds.ThisActpermittedtheBoard,forthefirsttimeinitshistory,tochargeusersoftheseweragesystemdirectlyforrelatedcosts.UndertheauthorityofActNo.567,sewerageservicechargeswereimplementedMay1,1967andsubsequently,sewerageservicerevenuebondstotaling$33,000,000weresoldin1968,1976,1982(2issues),and1983.Allseweragesystemrevenuebondsoutstandingin1986weredefeasedbythe$21,280,000Series1986SewerageServiceRevenuebonds.Thesebondswerefullyretiredin1994.Seweragesystemrevenuebondsintheamountof$30,000,000wereissuedin1997;$25,000,000in1998;$47,100,000in2000(twoissues);$32,720,000in2001;$57,000,000in2002;and$5,500,000in2003.$33,000,000inrevenuebonds,$25,200,000inBondAnticipationNotes(BANs),and$111,800,000inRefundingBANswereissuedin2004.The2004BANsweredefeasedbythe$137,000,000RefundingBANsSeries2005A.Aportionofthe2005BANswasrefinancedwiththeRefundingBANsSeries2006.Theremainingbalanceonthe2005BANswerepaidfromfundsonhand.TheRefundingBANsSeries2006weredueJuly15,2009andwerepaidinfullbytheissuanceofRefundingBondsSeries2009intheamountof$23,375,000.In2014,theBoardissuedSewerageServiceRevenueandRefundingBondsintheamountof$158,990,000.AportionoftheproceedswereusedtodefeasealloutstandingbondswiththeexceptionoftheSeries2011bonds.

InNovember2011,theBoardandLouisianaDepartmentofEnvironmentalQuality(LADEQ)enteredintoaloanagreementwhereby$9,000,000ofproceedsfromtheRevolvingLoanFundwere



borrowedthroughtheissuanceofSewerageServiceSubordinateRevenueBonds,Series2011.Debtservicepaymentsassumea20‐yeartermwitha0.45percentinterestrateplusanadministrativefeeof0.5percent.TheBoardbegandrawingdownthefundsduringthefirstquarterof2012andasofDecember31,2014,hadreceivedatotalof$9,000,000indisbursements.TheBoardbeganmakingprincipalpaymentsinNovemberof2013.WiththeissuanceoftheSeries2014bonds,theSeries2011bondsbecameparitydebtandentitledtotheprovisionsoftheGeneralSewerageServiceRevenueBondResolution.In2015,theBoardissuedSewerageServiceRevenueBondsintheamountof$100,000,000.Principalpaymentswillbeginin2021.Totaloutstandingprincipalonallrevenuebondstotaled$255,520,000asofDecember31,2015.

Drainage Department

In1966threeconstitutionalamendments,ActsNo.565,566,and567wereenactedbytheLouisianaLegislatureandsubsequentlyapprovedbytheState’svoters.ActNo.565authorizedtheCityofNewOrleanstolevyathree‐milladvaloremtax,effectiveJanuary1,1967,tobeusedsolelyforoperationsandcapitalcostsofthedrainagesystem.Provisionforissuanceofbondsrepayablesolelyfromthethree‐milltaxwasalsoincludedintheAct.In1967,theBoardissued$15,000,000ofthree‐milltaxbonds.Thesebondswerefullyretiredin1992.

UndertheLouisianaStateConstitution,allassessmentsbeginningin1978wereequalized,withresidentialpropertyassessedat10percentofitsmarketvalueandcommercialandpersonalpropertyassessedat15percentofmarketvalue.Theconstitutionalsoprovidesthatnotaxrevenuesshallbelostbyreassessments;thus,ithasbeennecessarytorevisethemillageratesineffectatvarioustimes.Ifreassessmentresultsinalowertaxbase,themillageratemaybeadjustedupward.Ifalargertaxbaseresults,themillageratesmustberolledback.However,bystatelaw,theCityCouncil,uponrequestandafterapublichearing,mayincreasethemillageratestotheprioryear’slevel.Thethree‐milltaxrate,6.01millssince1988,wasincreasedto6.40millsin1992duetoreassessment,andremainedatthatlevelthrough2007.In2007,itwasreducedto4.544andin2010itwasincreasedtothecurrentrateof4.66mills.

PassageofareferenduminApril1977,authorizedthecollectionofanadditionalsix‐mill,advaloremtaxfordrainagepurposes,effectiveJanuary1,1978.Thesix‐milladvaloremtaxwasincreasedto6.09millsin1988andto6.48millsin1992duetoreassessmentandremainedatthatlevelthrough2007.In2007,itwasreducedto4.60andin2010itwasincreasedtothecurrentrateof4.71mills.In1978,theStateLegislatureauthorizedadebtlimitof$18,000,000assoughtbytheBoardofLiquidation,CityDebt.ThatdebtlimitwaseliminatedbyLegislativeactionin2003.TheBoardissued$18,000,000inSeriesA,six‐milltaxbondinNovember1978.During1994theBoardissuedDrainageSystemRefundingBonds,Series1994,forthepurposeofrefundingthesix‐mill1978bonds.The1994bondswereconsideredtobeanobligationofthesix‐milladvaloremtaxrevenueandhavebeenrepaid.

In1980,aconstitutionalamendment,ActNo.844,authorizedanincreaseintheexemptionofeachhomesteadfromadvaloremtaxesfrom$5,000to$7,500,andprovidedforperiodicreassessment.

In1981,anine‐milladvaloremtaxwasapprovedandbecameeffectiveJanuary1,1982.Thepurposeofthenine‐milltaxlevyistoprovidefundsfortheoperation,maintenance,andconstructionofthedrainagesystem.Statelawsettheauthorizeddebtlimitfornine‐millbondsat$68,000,000.Thatdebt


4 OCTOBER 2016

limitwaseliminatedbyLegislativeactionin2003.TheBoardsoldnine‐millbondissuesof$22,000,000in1982and$30,000,000in1983.In1986,$12,525,000DrainageSystemBondsSeries1986Aand$15,755,000DrainageSystemBondsSeries1986Bwereauthorizedandsoldforthepurposeofrefundingaportionthe1982nine‐millbondsandaportionofthe1983nine‐millbonds,respectively.In1992theDrainageSystemBonds,Series1982,wasfullyrefunded,andbeginningin1993,debtservicepaymentsontheDrainageSystemBonds,Series1986Awaspaidfromnine‐milltaxrevenue.In1993,proceedsfromtheDrainageSystemBonds,Series1986BfullyrefundedtheDrainageSystemBonds,issueof1983,andthedebtserviceonthesebondsbecametheobligationofnine‐milltaxrevenue.AllSeries1986AandSeries1986Bbondshavebeenretired.In1998nine‐millbondsintheamountof$10,000,000wereissuedandadditionalnine‐millbondsintheamountof$20,000,000wereissuedin2002.In2014,theBoardissuedDrainageSystemRefundingBondsintheamountof$14,900,000forthepurposeofrefundingSeries1998andSeries2002.Thetotalnine‐millDrainageSystemBondsoutstandingasofDecember31,2015was$12,750,000.

In1988,reassessmentcausedthenine‐milladvaloremtaxtobeincreasedto9.13mills,anditwasincreasedduetoreassessmentagainin1992to9.71mills,andremainedatthislevelthrough2007.In2007,itwasreducedto6.89andin2010itwasincreasedtothecurrentrateof7.06mills.

Collectionofthethree‐milladvaloremtaxlevyisauthorizedthrough2016;six‐milltaxthrough2027;andnine‐milltaxthrough2031.

General

DuringJanuary2006,theBoardenteredintoalong‐termagreementwiththeFederalEmergencyManagementAgency(FEMA)undertheCommunityDisasterLoanActof2005.TheBoardhasdrawndown$61,956,747ofthefundsavailable.InDecember2010,theBoardwasgrantedapartialforgivenessintheamountof$36,790,000ofprincipaland$4,648,410ofaccruedinterest,leavingabalanceof$25,166,747inprincipal.InSeptemberof2013,theBoardwasgrantedfullforgivenessoftheremainingbalanceof$25,166,747.

InJulyof2006theBoardenteredintoaCooperativeEndeavorAgreementwiththeStateofLouisianatosecureproceedsfromtheState’sGulfOpportunityTaxCreditBondLoanProgramtoassistinpaymentofdebtservicerequirementsfrom2006through2008.TheBoardhasborrowed$77,465,247,whichwasthetotalamountavailabletotheBoard.Ofthatamount,$31,500,000wasusedtomakeapartialpaymentontheSewerageServiceRefundingBANsSeries2005AthatmaturedonJuly26,2006.TheremainderwasusedtomakedebtservicepaymentsontheDrainageSystemspecialtaxbonds,theSewerageServicerevenuebonds,andtheWaterrevenuebondsthatweredueonDecember1,2006;June1,2007;December1,2007;andJune1,2008.PrincipalpaymentsonthebondsbeganinJuly2012andcontinuethroughJuly2026.AsofDecember31,2015,theamountoutstandingwas$61,653,132.

TheBoardiscurrentlyreceivingfundsfromtheU.S.ArmyCorpsofEngineers(COE)sponsoredandcongressionallyauthorizedSoutheastLouisianaUrbanFloodControl(SELA)Project.Thisfundingwillallowadditionalconstructionprojectswhichwereidentifiedinthe1970s,butwhichhavenotbeencompletedbecauseoffundinglimitations.Theidentifiedprojectsaretobefundedeither100percentfromfederalfundsor65percentfromfederalfundsand35percentfromlocalfunds.Thepaybackperiodforthelocalshareis30yearsandisanticipatedtobeginin2018.



TheBoardprovideswaterandsewerforpublicservicestotheCityofNewOrleansanditspublicinstitutionsasmandatedbystatelawinaccordancewithR.S.33:4096andR.S.33:4121,respectively.During2015,theBoardprovided1,298,246,000gallonsofwaterforpublicservicestoagenciesoftheCityofNewOrleans.Thevalueofthiswater,atcurrentrates,is$6,123,591.86.Thevalueoftheseweragechargesis$6,551,362.

Thethreerevenue‐generatingpublicagencies‐theNewOrleansMuseumofArt,CityPark,andAudubonPark–continuedtoreceivewaterforpublicservicesunder“caps”,ormaximumannuallimits,establishedbytheLegislaturein1982.TheMuseumofArtused205,400gallonsor2,348,400belowitsannual“cap”of2,553,800gallons.CityParkused1237,139,800gallonsor198,183,600belowitsannual“cap”of235,323,400gallons.AudubonParkused106,828,100gallonsor133,171,900gallonsbelowitsannual“cap”of240,000,000gallons.

TheSewerageandWaterBoardandtheOrleansParishSchoolBoard(OPSB)reachedanagreementeffectiveJuly1,1992,wherebytheschoolswouldbechargedforanywaterexceedinganallowanceofsixgallonsperday,for365daysperyear,foreachstudentenrolledandanyotherpersonregularlyassignedtothatcampusorfacility.TheallowancewasloweredtofourgallonsperdayeffectiveJuly1,1993.

SOURCES OF FINANCIAL DATA FinancialinformationincludedinthisreportisobtainedfromauditedfinancialreportsprovidedbytheBoard.

SUMMARY OF FINDINGS ThissectioncontainsasummaryofthefinancialoperationsoftheWater,Sewerage,andDrainageDepartmentsfortheyear2015.Projectionsoffutureoperationsarealsopresentedasabasisfordeterminingtheadequacyofpresentrevenuesourcestofinanceprojectedoperatingexpensesandproposedcapitalprogramcostsoftherespectivedepartments.

ThestatisticaldatamaintainedbytheBoardincludesthecompilationofdetailedinformationonwatersalesandrevenues.Informationprovidedfor2015includesasummaryofthenumberofbillsissued,billedvolume,andrevenuesbycustomerclassforboththeWaterandSewerageDepartments.

Operationandmaintenanceexpensesaresummarizedbysupplementalaccountsthatareusedforinternalpurposestoidentifythecostineachfunctionalcategorythatisincurredforpersonalservices,servicesandutilities,materialandsupplies,replacementandmaintenance,andotherspecialcharges.

Water Department

Water Revenue Bond Resolution Requirements

SewerageandWaterBoardfinancialoperationsfor2015havecompliedwiththerequirementssetforthinthe2014GeneralWaterRevenueBondResolution.

Summary of 2015 Operations

Baseduponatabulationofwaterbillsrenderedduringtheyear,theWaterDepartmentprovidedwaterservicetoanaverageof129,809regularbilledcustomersand1,119governmentalaccounts,


6 OCTOBER 2016

thelatterofwhichareservedwithoutcharge.AccordingtodataprovidedbytheBoard,ofthe51,563.5milliongallonsofwaterpumpedbytheDepartmentduringtheyear,13,810.2milliongallonsweresold,653.3milliongallonsweremeteredtocustomerswithoutcharge,treatmentplantprocesswatertotaled645.3milliongallons,andunmeteredusesaccountedfortheremaining36,454.7milliongallons.Unmeteredwaterusesincludefireprotection;flushingstreets,sewers,anddrains;chlorinatingandflushingnewwatermains;constructionofstreets;SewerageandWaterBoardplantuses;andunaccountedforsystemlosses.

Thetotalrevenuefromwatersales,delinquentfees,interestincomeandotherincomeincreasedfrom$74,220,847in2014to$82,956,619in2015.Operationandmaintenanceexpenses(excludingclaimspaid)increasedfrom$69,394,244in2014to$78,264,668in2015.Afteraddingclaimsof$813,979anddebtservicepaymentsof$5,176,250,anegativebalanceof$1,298,278wasavailableforcapitalrelatedexpendituresin2015,unadjustedfordepreciation.

Ability to Finance Future Operations and Proposed Improvements

AsummaryofprojectedfinancialoperationsoftheWaterDepartmentfortheperiod2016through2020isshowninTable12ofthereport.RevenuesshownonLine1ofTable12arebasedonratesthatbecameeffectiveJanuary1,2016.Revenuefromfutureannualwatersystemrevenueincreasesof10percenteffectiveJanuary1,2017throughJanuary1,2020areshownonLine2ofTable12.

Futurelongtermdebtfinancingof$90,000,000in2017and$34,000,000in2019isindicatedtofundtheproposedcapitalimprovementprogram.

AsdemonstratedinTables11and12,itisanticipatedthatcurrentrevenuesourceswillbeadequatetoreadilyfinancebothprojectedcapitalprogramrequirementsandestimatedfutureoperationexpensesoftheWaterDepartmentduringthe2016‐2020studyperiodexaminedherein.

Sewerage Department

Sewerage Service Revenue Bond Resolution Requirements

SewerageandWaterBoardfinancialoperationsfor2015havecompliedwiththerequirementssetforthinthe2014GeneralSewerageServiceRevenueBondResolution.


Thetotalrevenuefromsewercharges,delinquentfees,interestincomeandotherincomeincreasedfrom$88,757,242in2014to$98,165,766in2015.Operationandmaintenanceexpenses(excludingclaimspaid)increasedfrom$48,559,050in2014to$58,028,723in2015.Afteraddingclaimsof$392,928anddebtservicepaymentsof$18,995,178,abalanceof$20,748,937wasavailableforcapitalrelatedexpendituresin2015,unadjustedfordepreciation.


AsummaryofprojectedfinancialoperationsoftheSewerageDepartmentfortheperiod2016through2020isshowninTable24ofthereport.RevenuesshownonLine1ofTable24arebasedonratesthatbecameeffectiveJanuary1,2016.Revenuefromfutureannualwastewatersystemrevenueincreasesof10percenteffectiveJanuary1,2017throughJanuary1,2020areshownonLine2ofTable24.



Futurelongtermdebtfinancingof$130,000,000in2017and$32,000,000in2019isindicatedtofundtheproposedcapitalimprovementprogram.

ItisanticipatedthatcurrentrevenuesourceswillbeadequatetoreadilyfinancebothprojectedcapitalprogramrequirementsandestimatedfutureoperationexpensesoftheSewerageDepartmentduringthe2016‐2020studyperiodexaminedherein

Drainage Department


Totalrevenuesreceivedfromallsourcesincludinginterestincometotaled$54,367,386in2015,anincreaseofapproximately10.9percentfrom$49,014,535reportedforthesamesourcesin2014.Totaloperationandmaintenanceexpensesincreasedabout22.4percent,from$30,899,222in2014to$37,814,502in2015.Afteraddingclaimsof$1,228,302anddebtservicepaymentsof$2,014,350,abalanceof$13,310,232wasavailableforcapitalrelatedexpendituresin2015.


AnanalysisoffinancialoperationsprojectedfortheDrainageDepartmentfortheperiod2016through2020issummarizedinTable35ofthereport.Revenuefromthethree‐mill,six‐mill,andnine‐milladvaloremtaxesmaybeusedforoperatingexpenses,debtservice,andcapitalexpenditures;howeverthethree‐milladvaloremtaxwillexpirein2016.

Theanalysisindicatesthatthecurrentrevenuesourcesarenotadequatetomeetoperationandmaintenanceexpensesandtotaldebtserviceonexistingbondissuesbeginningin2020.Inaddition,theDrainageDepartmentwillnothavethedebtcapacitytofundallofthecapitalrequirementsthrough2020.Duetoconstraintsonrevenue,itisanticipatedthatcapitalprojectsduringthe5‐yearperiodwillexceedtheamountoffundingavailablefromtheDrainageDepartment.ItisrecommendedthattheBoarddefercapitalprojectsuntilanadditionalsourceofoperatingrevenuehasbeenidentifiedandtheSWBNOhasthecapacitytodebtfinancemoreprojects.ThisdefermentisshownonLine10ofTable34.

Other Findings

TheBoardoperatesapowerplantattheCarrolltonWaterPurificationPlantwhichprovidespowerforthewaterpurificationprocessaswellbackuppowerintheeventthatcommercialpowerfailsorbecomesunavailable.TheBoard’sanalysisofpowerpurchasedandproducedisshowninthesupplementalsectionofthe2015ComprehensiveAnnualFinancialReport.In2015,approximately73.1millionkilowatthour(kWh)ofpowerwaspurchasedand29.2millionkWhofpowerwasgenerated.

Onaunitcostbasis,theaveragecostofpurchasedpowerhasincreasedoverthepastfiveyearsfromabout8.8¢perkWhin2010toabout9.1¢perkWhin2014.Duringthesameperiod,theBoard’sunitcostforgeneratedpowerhasdecreasedfromabout39.2¢perkWhtoabout32.5¢perkWh.ThecostofBoardgeneratedpowerisalmost3.6timeshigherthanthatofpurchasedpower;however,thishighercostisoffsetbythefactthattheBoardgeneratedpowerismuchmorereliablethatthepurchasedpowerfromthelocalutilitycompany.


8 OCTOBER 2016

Inconductingouranalysesandinforminganopinionoftheprojectionoffutureoperationssummarizedinthisreport,Black&Veatchhasmadecertainassumptionswithrespecttoconditions,events,andcircumstancesthatmayoccurinthefuture.ThemethodologyutilizedbyBlack&Veatchinperformingtheanalysisfollowsgenerallyacceptedpracticesforsuchprojections.Suchassumptionsandmethodologiesaresummarizedinthisreportandarereasonableandappropriateforthepurposeforwhichtheyareused.WhileBlack&Veatchbelievestheassumptionsarereasonableandtheprojectionmethodologyvalid,actualresultsmaydiffermateriallyfromthoseprojected,asinfluencedbytheconditions,events,andcircumstancesthatactuallyoccur.


BLACK & VEATCH | Facilities Evaluation ‐ Operation, Maintenance, and Reconstruction 9

Facilities Evaluation ‐ Operation, Maintenance, and Reconstruction ThisevaluationsummarizesthefindingsoftheonsiteassessmentsoftheSewerageandWaterBoardofNewOrleans(SWBNO)facilitiesconductedbyBlack&VeatchfromMay16toMay20,2016.Sitevisitswereconductedatthewaterandwastewatertreatmentplants,Carrolltonpowerplantfacilities,andCentralYardfacilitiestoevaluatetheconditionandoperationalcapabilitiesofthesefacilities.Inaddition,thesewageanddrainagepumpstationswereinspectedtoevaluatetheircondition.InterviewswereconductedwithSWBNOmanagementandsupervisorsduringthesitevisittoassessthecurrentoperationsstatusofthevariousfacilities.

INTRODUCTION TheoperationsdepartmentoftheSWBNOiscomprisedoffourunits:(1)WaterPurification,(2)SewageTreatment,(3)WaterPumpingandPower,and(4)SewageandDrainagePumping.TheSWBNOoperatestheCarrolltonandAlgiersWaterPurificationplants(WPPs),whichpurifyrawwaterfromtheMississippiRiverandsupplypotablewatertoNewOrleansresidents.TheCarrolltonPlantcurrentlypurifiesapproximately135milliongallonsperday(mgd)ofwaterfortheEastBankofOrleansParish.TheAlgiersplant,whichservesthepredominantlyresidentialWestBankportionoftheparish,purifiesroughly10mgdofwater.Thetreatedwaterfromthetwoplantsispumpedthroughapproximately1,800milesofmainstotheserviceconnectionswithinthecity,aswellastoseveralcustomersinadjacentparishes.

Theseweragecollectionsystemincludesseveralmilesoflateralsewers,trunksewers,and83electrically‐operatedpumpstations.Rawsewageisconveyedthroughaforcemainsystem.SewagePumpingStations(SPSs)AandDontheEastBankandSPSContheWestBankareattendedstations.SPSAhousesasupervisorycontrolanddataacquisition(SCADA)system,whichmonitorsoperationofallothersewagestations24hoursaday.

TheSWBNOoperatestwosewagetreatmentplants,oneontheeastbankandoneonthewestbank.TheEastBankSewageTreatmentPlanthasatreatmentcapacityof122mgd(dryweather)andtreatssewagefromtheEastBankcommunity.TheWestBankSewageTreatmentPlanthasatreatmentcapacityof20mgd(dryweather)andservestheWestBankcommunity,aswellasafewcustomersinPlaquemineParish.Bothplantswerebuiltorexpandedinthe1970sandhavebeenupgradedorexpandedtoincreasereliabilityandcapacity.Thecontractoperator,VeoliaWater,currentlyoperatesandmaintainstheplantsforSWBNO.

Inaddition,theSWBNOisresponsibleforoperatingandmaintainingthe24majordrainagepumpingstationsinNewOrleansand11smaller(automatic)underpassstations.Themajorityofthosestationsaremanned24hoursperday,7daysperweek.Eachstationisequippedwithmultiplepumps,whichareactivatedinresponsetoincreasingwaterlevels.Personnelroutinelymonitorthesepumpsandthenumerousmilesofdrainagecanalstoensureproperdrainageinthearea.

The25cyclepowerplantoperatedbytheSWBNOprovidespowertoportionsoftheWPPsandapproximately60percentofthedrainagepumps.TwolargeverticalsewagepumpingunitsatStationAarealsorunon25cyclepower.ThefollowingsectionssummarizekeyissueswithinseveraldepartmentsoftheSWBNO.


10 OCTOBER 2016

STAFFING AdequatestaffingcontinuestobeanissueformostdepartmentsattheSWBNO.AdditionalmaintenanceisrequiredfortheSWBNOfacilitiesasequipmentagesandmoreequipmentisadded.StaffinglevelshavedecreasedasthesystemhasagedandexpandedwithintheSWBNO‐ownedfacilities.Vacanciesstillexistinseveraldepartments,especiallythosedepartmentsrequiringhighlyeducatedandskilledpersonnel.Theseshortagesarereflectedwithinthemoretechnicaldisciplinessuchasmechanicalmaintenance,electricalmaintenance,plantmaintenance,weldingandfabrication,andoperations.Engineeringisstillunderstaffed,butitisimprovingbecausetheslowdownofprivateindustryinthelocalarea.

TheSWBNOsuspendedthedomicilepolicyfollowingHurricaneKatrina,whichrequiredemployeestoliveinNewOrleans.ThissuspensionactionallowedpersonnelhiredbytheSWBNOtoliveoutsidecitylimits,thusprovidingmorehousingoptionsforemployees.TheCityCouncilreinstatedtheresidencyrequirementsasofJanuary1,2013,whichhasslowedthehiringofindividualswithaninterestinworkingfortheSWBNObutliveoutsidecitylimits.DepartmentswithintheSWBNOcontinuetoactivelyrecruitfromlocalcollegecampuses,careerjobfairs,andtradeschoolstofillvacancies.

Inadditiontothosehighlyskilledpositions,asignificantportionoftheSWBNO’sleadershipwillretirewithinthenextfiveyears.Veryfewpotentialsuccessorshavebeenidentifiedtoassumetheleadershippositionsofthepersonnelfacingretirement.

MostdepartmentshavestaffingissuesrelatedtobeinginadequatelystaffedtofulfillthecurrentneedsoftheSWBNO.Thetablebelowsummarizesthenumberofstaffonthepayrollforeachdepartmentrelatedtooperationsandmaintenance,andthepercentageofstaffeligibleforretirementwithinthenextfiveyears(asofMay2016).Theseconditionsdemonstratetheneedforaneffectivesuccessionplanforthedepartmentheadsandsupervisors.

Current Number of Board Employees and Employees Eligible for Retirement

DEPARTMENTEMPLOYEESON

PAYROLLELIGIBLEFORRETIREMENT

%ELIGIBLEFORRETIREMENT

Operations‐WaterPurificationPlants 50 16 32.0

Operations‐WaterQualityLaboratoryatCarrolltonPlant

9 3 33.3

Operations‐WaterPumpingandPower 75 18 24.0

Operations‐SewageandDrainagePumpingStations

105 30 28.6

FacilityMaintenance 61 17 27.9

Engineering 48 18 37.5

Networks 319 57 17.9

SupportServices 102 29 28.4

EnvironmentalAffairs 12 4 33.3

Total 781 192 24.6



WATER PURIFICATION PLANTS TheBlack&VeatchrepresentativeaccompaniedtheWPPsuperintendentonfacilitytoursoftheCarrolltonandAlgiersWPPs.TheCarrolltonandAlgiersWPPsarecurrentlyoperationalandproducingwaterthatmeetsorexceedsfederaldrinkingwaterstandards.TreatmentsystemsatbothplantsarefunctioningwellandcontinuetoproducepotablewaterfortheEastBankandWestBank.

ThestaffinglevelsattheCarrolltonandAlgiersWPPshavebeenabletoconsistentlyproducefinishedwaterthatcomplieswithfederalandstateregulationsandmeetsthecapacityoftheservicepopulation.TheSWBNOisfacingtheindustry‐wideproblemofanagingworkforce;therefore,thereisanimmediateneedtohireandtrainpersonnelforthefuturesustainabilityofplantoperations.TheSWBNOhashiredentry‐levelpersonnelandisintheprocessofhiringmoretobeginaddressingthoselong‐termneeds.SWBhasaninternaltrainingprogramthatassistsoperationsstaffwithpassingtheirstatecertificationexams.Inaddition,statecertifiedoperatorsareinshortsupplyandarerequiredonsiteatalltimesbecausetheyarenecessarytosuccessfullyoperatetheplantsaroundtheclock.Themostsenioroperatorswillberetiringwithinthenextfewyearsandwillneedtobereplacedinordertomaintaincompliancewiththestaterequirementsforoperatorcertificationinwatertreatment.Atpresent,therearenotenoughcertifiedwaterplantoperatorstocoveralltheshiftsandthedepartmentisusingovertimetoensurecomplianceismaintained.

Carrollton Water Purification Plant

TheCarrolltonWPPhasadesigncapacityof210mgd.ThewatertreatmentprocessesattheplantconsistofflocculationwithapolymerandferricsulfatefollowedbypHadjustmentwithlime.TheflocculatedparticlesareallowedtosettleinsedimentationbasinsandtravelingmechanicalrakesremovethesettledsolidsfromthesedimentationbasinsfordischargetotheMississippiRiver.

Chlorineintheformofsodiumhypochloriteisusedtodisinfecttheclarifiedwater.Anhydrousammoniaisthenaddedtoformchloraminesforresidualdisinfection.Additionalsettlingtimeanddisinfectioncontacttimeoccurinthesecondarysettlingbasins.Theclarifiedwaterisalsotreatedwithsodiumhexametaphosphateforcalciumsequestrationandhydrofluorosilicicacidforfluorideaddition.TheSWBNOisfeedingallchemicalsatappropriatedosagesandmaintainingadequatechemicalstorageateachsite.

Filtrationisthefinalstepinthetreatmentprocess,whichiswherethewaterisfilteredthroughrapidsandfilters.Finishedwateristhenpumpedtothepopulacethroughthedistributionnetwork.

TheCarrolltonWPPiscurrentlytreatingapproximately135mgdofwaterfortheEastBankofOrleansParish,partlyduetoleaksinthewaterdistributionsystem.Leaksinthedistributionnetworkareasourceofpersistentproblems.TheseleaksarecurrentlybeingaddressedunderthewatermainreplacementprogramfundedbytheFederalEmergencyManagementAgency(FEMA).Thewaterdeliverypressure,at70psi,hasbeenconsistentthroughoutthelastyear.


12 OCTOBER 2016

L3 Sedimentation Basin Flocculator Rehab Filter Media replacement at Filter 7

Figure 1 – Carrollton Water Purification Plant

Improvementsinitiatedand/orcompletedattheCarrolltonWPPduring2015include:

TheG4SedimentationBasinwasplacedbackintoserviceafterthebasinwascleanedandflocculatorrehabwascompletedin2015.Afteroperatingthebasin,itwasdeterminedbyoperationsstaffthatthebasinhadaleak,andwasofflineattimeofvisit.

ClaiborneFilter1MediaReplacementandRehabwascompletedandwasrecentlyreturnedtoservice.Thefilteriscurrentlyperformingwell.

Thefollowingmaintenanceand/orimprovementprojectsforexistingfacilitiesattheSWBNOareplannedorongoing:

L3SedimentationBasinisofflineforflocculatorrehabandmaintenanceofthebasin’smechanicalcomponents.

ThebidforacontractortodoachalkandwatertestfortheG4Basinwillbeadvertisedduringthesummerof2016.Thisworkisscheduledtobecompletedbytheendofyear.

Atankmixingstudywasconductedonalltanksattheplant(includingtanksatAlgiersWPP)includinghydraulicmodeling.Asaresult,thesestoragetankswillbemodifiedwithmanifoldsystemsforbettertankmixing.

Fourconcrete4MGstoragetanksareintheprocessofbeingrepainted.Thetankswereinspectedandthetankstructuresweredeterminedtobeingoodcondition.



AfilterrehabilitationprogramisplannedfortheSycamoreandClaibornefiltergalleries.Valves,actuators,corrodedpipingsupports,andleakingpipesassociatedwiththefiltersneedtoberepairedorreplaced.MediareplacementisongoingfortheClaibornefiltergallery.

MediareplacementforClaibornefiltersisongoingcurrently.MediawasbeingtakenoutofFilter7atthetimeoftheonsitevisit.Filter5mediaisalsobeingreplaced.Atthetimeofreplacement,thefilterstructureisinspected(suchastheunderdrains)andadditionalrepairsaremade.

TheSycamorefilterwashwaterpumpforthefiltersisplannedforreplacement.Thepackingsealwasleakingduringthesitevisitandthepumpisnearingtheenditsservicelife.Theprojectiscurrentlyindesign.

Therecyclebasinpumpsarebeingreplaced.Twoofthefourpumpsarecurrentlyinoperableandtheothertwopumpsarenearingtheendoftheirservicelife.Constructioniscurrentlyongoing.

Designforanew30‐inchsludgedischargelineisunderway.ThisnewlinewillprovideformuchneededcapacityandredundancyimprovementsfortheCarrolltonWPP.Thisimprovementwasindesignattimeofsitevisitandwillbeinstalledin2017.

Anadditionaltemporaryferricsulfatebulkstoragefacility(20,000gallonsoftanksandtemporarycontainment)isintheprocessofbeingaddedduetolimitedlocalsupplyofthechemical.

Anewchemicalstorageandfeedfacilityiscurrentlyunderdesign.Thefacilitywillhousemostofthechemicalsonsite.

Algiers Water Purification Plant

TheAlgiersWPPhasadesigncapacityof40mgd.ThetreatmentprocessattheplantissimilartothatoftheCarrolltonfacilityandusesthesamechemicalswithaslightlymodifiedapplicationschemeintheupflowclarifiers.Atpresent,theplantistreatingapproximately10mgdofwaterandisservingthepredominantlyresidentialWestBankportionoftheparish.

ThefacilityhaspartiallycommissionedanewferricstorageandfeedsystemforflocculationattheWPP.Thisequipment,alongwiththeexistingtemporaryferricstorageandfeedequipment,issupportingtheneedsoftheplantwiththegoalofacompletetransitiontothenewfacilitybytheendof2016.

Otherimprovementsneededorongoingattheplantincludethefollowing:

Anewbulksodiumhypochloritetankwasadded,alongwithmeteringpumpstosupplybleachfordisinfection.Twoexistingbulktankswererepurposedfromthedecommissionedsodiumhypochloritegenerationsystem.

Instrumentationwasaddedtothefilterstodisplayflow(MGD)andheadlossateachfilter.TheseinstrumentscurrentlyarenottiedintoSCADA.FutureSCADAupgradeswillintegratethesereadingsforfiltermonitoring.

EIMCOClarifiersNo.3and4areundercontracttodesignthereplacementofthelaundertroughs.Thetroughsandsteelstructureshavesignificantcorrosion.Themechanicalcomponentsoftheclarifiersareoperatingwellandaremaintainedbythemaintenancestaff.

EIMCOClarifier2waspaintedin2015.


14 OCTOBER 2016

InadditiontotherehabandpaintingoftheEIMCOclarifiers,flashmixingwillbeaddedtoassistwithbetterTOCremovalintheclarifiers.Theexistingclarifierswillbemodifiedtoincludeanadditionalmixernearthechemicalinjectionpoint.

Fluoridestorageandfeedsystemneedstobeupgradedtomeetstaterequirements.Thefluoridesystemwillconsistofabulkstoragetank,adaytank,andmeteringpumpsandwillbelocatedinanexistingbuilding.

LimeiscurrentlyslakedattheWPP.SWBislookingintoreplacementofthelimeequipmentpendingadecisionofprocesschange(differenttypeoflime)ordirectreplacementofexistingslakingequipment.

Therawwaterpumpingandpipingsystemsneedtobeimprovedinordertoprovideredundancytotheintakesystem.

CorrosiononClarifierTroughs NewSodiumHypochloriteStorageTank

Figure 2 – Algiers Water Purification Plant

WATER QUALITY LABORATORY ThewaterqualitylaboratorylocatedattheCarrolltonWPPconductsdailyanalysesofriverwaterqualityandpurifiedwaterforbothWPPs.Watersamplesfromthedistributionnetworkarealsoanalyzedatthelaboratoryfacility.ThelabcontinuestomeetthestateandfederalmandatedanalyticalrequirementsofthewaterplantsanditiscertifiedbytheLouisianaDepartmentofHealthandHospitalsforanalysisofcoliformbacteria.

Thelaboratorycollectssamplesforprotozoananalysisinadditiontocoliformanalysis.Otherregularanalysesincludehardness,turbidity,fluoride,ammonia,pH,alkalinity,totalorganiccarbon(TOC),dissolvedorganiccarbon(DOC),phosphorus,corrosionmonitoring,andchlorineresidualatdifferentstagesoftreatment.Thesolidsareanalyzedfortotalsuspendedsolids(TSS)andtotaldissolvedsolidsconcentrations.Thelaboratoryalsoanalyzesriverwaterandfinishedwatersamplesforvolatileorganiccompounds.



ThelaboratorycontinuestomaintainitsinvolvementintheEarlyWarningOrganicsContaminationDetectionSystem(EWOCDS)runbytheStateDepartmentofEnvironmentalQuality(LDEQ),despitethatseveraloftheLDEQupstreamstationshaveprovedunreliable.TheEWOCDSprogramhasalsobeenunderfundedbythestateofLouisiana,whichhascausedareductioninsamplingandanalysis.

TheremainingreliablemonitoringstationsareconnectedbytelecommunicationstonotifyLDEQifanyofthe60EnvironmentalProtectionAgency(EPA)listedpollutantsaredetectedintheriverwatersamples.TheLDEQdisseminatestheinformationtotheprogramparticipants,allowinganearlywarningofpossibleproblems.TheLDEQmaintainsEWOCDSequipmentatallparticipatinglocationswhiletheprogramparticipantsprovidethemanpowertocollectandanalyzethesamples.

Thelaboratoryiscurrentlyunder‐staffedwithonesupervisor,onemicrobiologist,twochemists,andthreetechnicians.Thelablosttwochemistsandalabtechnicianoverthepastyear,whichhascreatedvacanciesthatSWBisworkingtofill.Muchofthelabinstrumentationandequipmentisreachingorhasreachedtheendofitsservicelifeandisinneedofreplacement.Neweranalyticalinstrumentsandequipment,suchasanewgaschromatograph/massspectrometer(GC/MS),autoclavesforthemicrobiologylab,andfumehoodsinthechemistrylabareneeded.Theautoclavesarebeingacquiredforlabuse.ThelaboratorystaffobtainedcertificationtoanalyzeTOCattheSWBNOfacility;however,thecertificationrecentlylapsedduetolackoflabstaff(mainlychemists)tomaintaintheQA/QCrequirementsforTOCanalysis.

WATER PUMPING AND POWER TheprimaryfunctionoftheWaterPumpingandPowerunitoftheOperationsDepartmentistoproducesteamforthegenerationof25hertz(Hz)powerinadditiontopumpingpotablewatertotheCityofNewOrleans.ThefacilitiesattheCarrolltonpowerplantincludethreepumpingsteamturbinesandonegasturbineforatotaltheoreticalcapacityof61megawatts(MWof25cyclepower).Thesteamrequiredfortheturbinesisgeneratedinthesixboilersatatotalcapacityof650,000poundsofsteamperhour.Inadditiontothe25Hzturbine,newlyinstalledTurbineNo.6produces15MWof60Hzpower,andwasmadeoperationalinearly2016.Theturbineonlyservesasbackup,butisruneverytwoweekstoensureitisworkingproperly.

ThegeneratingstationattheAlgiersfacilityiscapableofproducing60cyclepowerusingadieselgenerator.ThepowergenerationfacilitycangenerateenoughpowertosupportoperationsattheAlgiersplant.Thisstationisalsocapableofperformingafrequencychangefrom25HzpowersuppliedfromtheCarrolltonpowerplantto60Hzpower.

ThecurrentcapacityoftheCarrolltonpowerplantis40MW,whichislessthanthe61MWdesigncapacity.TurbineNo.4iscurrentlybeingrepairedandwillundergotestingtoensureitisoperatingcapacity.Turbine3iscurrentlyonlineandscheduledtoberepairedin2016‐2017onceTurbine4isbackonline.RehabilitationofBoilersNo.4,5,and6wascompletedin2015‐2016.Boiler3iscurrentlybeingrehabbedandwillbecompletein2016.Boiler1willberehabbedonceBoiler3iscompleted.Additionalboilerpipingisscheduledforrepairandreplacement.Thisprojectwilloccuroncealltheboilersarerehabbedandoperational.

A200psihighpressurenaturalgaslinesuppliesfuelforthe15MW60cycle,dualfuelgeneratorturbinepackage(TurbineNo.6)andtheexistingTurbineNo.5.The15MW,60HzgeneratorfacilitysupplementsthecommercialpoweravailablefromEntergytoprovidepowerredundancyand


16 OCTOBER 2016

continuedserviceintheeventofacommercialpowerlossduetostorms,hurricanes,etc.Thegeneratorservesthemajorityoftheplantandrawwaterintakestationsandprovidesadditionaldrainagestationcapacity.

Twosteam‐drivendistributionpumpsarelocatedatthepowerplant.PumpArehabilitationwascompletedinMarch2014andPumpBwascompletedattheendof2015.PumpBiscurrentlybeingtestedtoensurethepumpisoperatingproperly.TheClaibornePumpingStation,consistingoffourwaterdistributionpumps(two60Hzdriveandtwo25Hzdrive),andthePanolaStation,consistingoftwopumpingunits(eachwitha25and60Hzmotor),areusuallyadequate(with100%redundancy)forpumpingfinishedwatertothedistributionnetwork.The25HzpumpatPanolaStationhasbeenconvertedtooperateonboth25and60Hzpowerformorepumpingoperationredundancy.ThewaterhammerprogramwillprovideforthereplacementofequipmentandassociatedvalvesatthePanola,A&BPumpRoomandClaibornepumpingstations.Twoelevatedtankswillalsobeinstalledtoprovidesurgeprotectiontothedistributionsystem.Theseprojectsarecurrentlybeingbid.

Storm‐proofingprojectsforcriticalSWBNOfacilities,includingthepowerbuildings,wererecentlycompletedbyUSACE.Improvementsforthepowerbuildingsincludereinforcingthewalls,roofing,doors,andwindows.Additionaldamage‐relatedworkfromKatrinaprimarilyincludesvalvereplacementandrepairtoelectricalcomponentsandcontrols.Relateditemsforthewaterpumpingandpowerunitareinvariousstagesofdesignorconstruction.Additionalprojectsincludereplacementofthedieselstoragetankwithtwonewaboveground‐tanksthathaveatotalcapacityof250,000gallons.Thisprojectiscurrentlyunderconstruction.

Thewaterpumpingandpowerunithas75currentemployees.Powerforcontinuedoperationsofthewater,sewerage,anddrainagesystemsrequiresstaffing24hoursperday,7daysaweek.Giventhecurrentlevelsofstaffing,overtimeisrequiredtocoverallthenecessaryareaswithinthepumpingandpowerunit.Inaddition,approximately18senioroperatorsorsupervisorsaresettoretireinfiveyearsorless.Retirementwasmentionedasthemainstaffingprobleminthisdepartment,especiallyathigherpaylevels,suchasturbineandboileroperationspositions.Additionalstaffwillneedtobehiredandtrainedtofillthesefuturevacanciesduetoretirement.

Central Control

TheCentralControlPowerDispatchingDepartmentisprimarilyresponsibleforthedeliveryofanadequatesupplyofboard‐generatedelectricalpower,thecontinuousmonitoringoftheoperationalstatusofallelectricalswitchgear,andthetestingofrelatedelectricalfeedersandequipment.Thisdepartmentisalsoresponsibleforverifyingandenforcingtheboard'ssafetyclearanceproceduresandassociatedclearanceswithinthepowerdistributionsystem.Inaddition,thisdepartmentmonitorslocalandregionalweathertoprovideadvancewarningofstorms,whichcouldaffectpowergenerationrequirementsforthedrainageandseweragesystems.Coordinationofvariouspowersupplies,includingalternativebackuppowersuppliessuchasdieselgeneratorsandfrequencychangers,alsocomprisepartofthisdepartment'sresponsibilities.TheCentralControlPowerDispatchingDepartmentplaysavitalroleinmanyemergencyoperationalsituations.Servingasahubofcommunications,CentralControlinformstheboard'smanagementandseniorlevelstaffofchangesinconditionsthatwillaffecttheboard'sabilitytoprovideadequatesewerage,water,anddrainageservices.CentralControlalsoprovidesvaluableinformationduringemergenciessuchashurricanes,



floods,freezes,etc.,totheOfficeofEmergencyPreparednessthroughestablishedboardprotocols.Lackofstaffingcontinuestobeamajorissueforthisdepartment.

SEWAGE TREATMENT PLANTS OperationsandmaintenanceactivitiesofbothplantshavebeencontractedtoVeoliaWater.ArepresentativeoftheSWBNOoverseesthecontractoperator.ThisrepresentativeworksintheOperationsDepartment,whichiswithintheSWBNO,fortheOperationsDepartment.Bothtreatmentplantswereoperationalatthetimeofthesitevisitsandweremeetingthedischargelimitsaccordingtotreatmentplantpersonnel.Thecontracttooperatebothfacilitieswasrecentlybid;Veoliawonthecontractandwillcontinuetobethecontractoperatorforthenextnineyears.

East Bank Sewage Treatment Plant

TheEastBankPlanthasatreatmentcapacityof122mgd(dryweather).Theplantiscurrentlyreceivingapproximately100mgdofflow.In2015,averageflowfortheplantwas94.07mgd,whichwasgreaterthanthe2014averageof93.5mgd.Thetreatmentfacilitiesattheplantincludebarscreens,gritremoval,apureoxygenactivatedsludgesystem,finalclarification,anddisinfection.Thesolidsgeneratedduringsewagetreatmentarethickened,dewatered(usingbeltfilterpresses),andfinallyincinerated.Anewsludgedryeriscurrentlyunderdesignasanalternativesludgetreatmentsystemtosupplementtheexistingfluidbedincinerator(FBI).

EffluentPumpsNewMixeronReactor1

Figure 3 – East Bank Sewage Treatment Plant

ThefollowingitemssummarizetheimprovementsthatwillbeorhaverecentlybeenperformedattheEastBankPlant:

Reactors1and4wereoutofserviceduringsitevisit.Trains2and3wereonline.RehabilitationandreactorcleaningofTrain1wascompletedrecentlyandisawaitingstartup.Themixerswerereplacedwitheightnewmixersduring2015‐2016.Reactor4willberehabbed(currentlyscheduledfor2017)onceReactor1isonline.


18 OCTOBER 2016

LELsensorswereinstalledinthereactorstomonitorexplosivegasesalongitsautomatedvalvestomaketheprocesssafetooperate.Thisworkwascompletedin2016.

Thereisnoautomationforthemechanicalrakeonthebarscreensandrakingmustbeconductedmanuallyatregularintervals.Aprojecttoinstallautomatedrakeswithcontrolsisbeingperformedinhouseandwillbecompletedbytheendof2016.

Atemporary,abovegroundreplacementlineisbeingusedtoreturnsludgefromthereturnactivatedsludgepumpstationstotheinfluentchannel.Thepermanentrepairdesignwascompletedandawardedin2015.Theconstructionwascompletedinearly2016andRASPumps6and9arecurrentlytiedintotheline.RASPumps7and8willbetiedintothelinebytheendof2016andatthatpoint,thetemporarylinewillbetakenoutofservice.

Thescumarmonthesecondaryclarifierswasnotinoperationattimeoffieldvisit;howevertheplantoperatorindicatedthattheclarifiersneededadditionalsteelrepairsandthattherepairwillbeincludedaspartofthatprojectwhenitgoesouttobidin2016.

Theoperatornotedtheliquidoxygentankisneartheendofitsusefullife.Highpurityoxygensystemcomponentsappearedingoodcondition.Currently,thecontractoperatoriswaitingforquotesfromvendorsforthetankreplacementandisplanningtocompletein2016.

Severalmechanicalmixersonaerobicreactorswereoutofserviceduetoregularpreventativemaintenance.Thesemixerswillnotberepairedduetothependinginstallationofthenewmixingsystemin2017.

Effluentpumpsappearedtobeinfaircondition.Theoperatornotedthattherehavebeendifficultieskeepingthesepumpsoperatingreliablyduetoelectricalsystemissues.Theelectricalsystemisbeingevaluatedandwilllikelyrequireupgradestoincreasethereliabilityoftheeffluentpumps.A2400VEffluentPumpelectricaldistributionsystemalongwithswitchgearandVFDsisindesignphaseandwasbidin2015.ProjectwillbegininAugust2016.

Pipinginstallationfromtheclarifierstothewetlandsdemoandexpansioncellswerecompletedin2016.

TheFBIwetscrubberwillbereplacedin2016or2017.TheincineratorwillbetakenofflineforseveralmonthsandatthattimebrickswillbereplacedinthewallsandceilingoftheFBI.

Themulti‐hearthincineratorwasdecommissionedandremovedfromthesitein2016.

AnewwastepumpinthesouthpumphousewillbeaddedtosatisfytheEPA’srequestforpumpredundancy.

Anewconcretewallwasinstalledinthesedimentationbasintopreventwastewaterfromenteringtheeffluentchanneltopreventfuturefecalhitsineffluent.

ReplacementoftheVSAoxygensystemequipment(blowers,motors)iscurrentlybeingsolicitedforquotesbythecontractoperator.

Theferratorisinserviceanddisinfectstheeffluenttothewetlands.

Theautotransferswitchisneededtoautomaticallytransferpowerfromtwoonsitefeedersifonefails.Currentlythisisdonemanuallyandrequiresspecialpersonalprotectiveequipment(PPE)andtime(atleast30minutes)totransferpowerfromonefeedertoanothertokeeptheplantonline.



Aprojecttoconvertgaschlorinetosodiumhypochloriteisbeingconsideredbecauseofsafetyconcerns.Currentlytheplantusesrailcarstoobtaingaschlorinefordisinfection.

TheaverageinfluentTSSandBODconcentrationsfor2015wereapproximately130milligramsperliter(mg/L)and96mg/L,respectively.Effluentqualityhasbeenadequateoverthelastyear,withanaverageeffluentTSSconcentrationof12.8mg/LandanaverageeffluentBODconcentrationof17.8mg/L.Sevenpermitviolationsoccurredin2015.FivefecalcoliformmaximumdaylimitviolationsoccurredinJune2015.ThefecalviolationsinJune2015wereduetoacontractorpumpinggritfromReactor1whensolidswereaccidentallyreleasedintotheeffluentchannel.Thisfacility’spermitexpiredtwoyearsagoandarenewalwassenttoDEQontime.SWBisincommunicationwithDEQandisawaitingadraftpermittoreviewandaccept.

West Bank Sewage Treatment Plant

TheWestBankPlanthasatreatmentcapacityof20mgd(dryweather).Theplantiscurrentlyreceivingapproximately9mgdofflow.TheWestBanktreatmentfacilityconsistsofbarscreens,primaryclarifiers,tricklingfilters,finalclarifiers,andchlorinedisinfection.Primaryandsecondarysolidsareco‐thickenedinagravitythickenerandhauledtotheEastBankfacilityforincineration.

New Grit Pumps Valve repair on West Primary Clarifier in progress

Figure 4 – West Bank Sewage Treatment Plant

ThefollowingitemssummarizetheimprovementsthatwillbeorhaverecentlybeenperformedattheWestBankPlant:

Concreteandpavementadjacenttothebarscreensandaeratedgritbasinsshowedcracksandsettling.

BarScreens1,2,and4areoperational.BarScreen3wasrecentlyrehabbedandneedsadditionaladjustmentstotreatatfullscreencapacity.


20 OCTOBER 2016

Gritcyclonesforcollectinggritfromthegritbasinsexhibitedsignificantcorrosion.Twogritclassifierswerereplacedin2014and2015.

Threegritpumpswerereplacedin2016.

AeratedGritBasin2wascleanedin2016.

Primarysedimentationbasins’weirsandrotatingarmsshowedsignificantcorrosion.

TheWestPrimaryClarifierwasrehabbedin2015‐2016andwillbepaintedbytheendofthisyear.

TheWestPrimaryClarifieralsohadaleakingvalveduringthesitevisit.TheCentralPrimaryClarifierwillhavecenterwellrepairsconducted,butasofthesitevisitthetimeframewasnotknown.

MainCollectionBasinPump3hadimpellerreplacementsandrehabilitationworkcompletedin2016.Pumps1and2willbecheckedandrehabbedlaterthisyearorearly2017.

Thestructuralconditionofthetricklingfiltersappearedtobegood.MinorstructuralissueswithTricklingFilterNo.1werenotedandaregettingworsesincethesitevisitin2015.

Thedrivemotorforthearmsonthetricklingfiltersiscurrentlyinoperableandoperatesbasedonhydraulics;however,treatmentisstillacceptable.

Pump2wasofflineduringthe2015sitevisitduetoanadditionalinoperablevalve.Maintenanceremovedandrepairedthevalvein2015.

TheSCADAsystemwasdownduringsitevisitconductedin2015.TheSCADAwasreloadedandiscurrentlyonlineandoperational.Minorupgradestothesystemareongoingandshouldbecompletebytheendof2016.

Influentflowmeteriscurrentlynotoperational.ThemeterisorderedbutrequirescoordinationbetweencontractoperatorandSWBstafftocompleteinstallation.

AsludgepumponEastPrimaryClarifierneedstobereplacedandisscheduledtobereplacedin2016or2017.

Autotransferswitchisneededtoautomaticallytransferpowerduringaplantoutage.CurrentlythisisdonemanuallyandrequiresspecialPPEandtime(atleast30minutes)totransferpowertokeeptheplantonline.

Aprojecttoconvertgaschlorinetosodiumhypochloriteisbeingconsideredduetosafetyconcerns.Theprojectwasbidandawardedin2016.Constructionshouldbeginlaterin2016.Currentlytheplantusesone‐toncylinderstoobtaingaschlorinefordisinfection.

Avalvereplacementprogramisunderwayandrequiresautilitylocateacontractortoassistinlocatinglinesandburiedvalves.Thecontractoperatoriscurrentlyworkingwith811(callbeforeyoudig)forassistancebeforedigging.

ThemonthlyaverageTSSandBODinfluentconcentrationsfor2015wereapproximately106and97mg/L,respectively.ThemonthlyaverageeffluentTSSandBODconcentrationsfor2015havebeenapproximately10.1and8.3mg/L,respectively.Theaverageflowfor2015was9.1mgd,whichisapproximatelythesameasin2014at9.2mgd.For2015,thisplanthasmetorexceededallpermittedeffluentlimits.



SEWERAGE AND DRAINAGE PUMPING STATIONS Siteassessmentsofthedrainagepumpstations(DPS)andsanitarysewerliftstations(SLS)ofboththeEastBankandWestBankofNewOrleanswereconductedfromlateMaytothefirstweekofJune.ABlack&VeatchoperationsspecialistwaspresentfortheinspectionsconductedonMay19,2016,withJulienEngineeringrepresentativeandSWBstaff.TheobservationreportandaccompanyingtabledetailstheoperationalstatusofeachSLSandDPSacrossthecityofNewOrleans.Pumpsthatwerenotturnedonatthetimeoftheobservationsweredeemedtobeeither“inservice”or“outofservice”basedondirectionfromSewerageandWaterBoardsupervisorsorpumpstationoperators.

Uponinspection,allDPSsandSLSsareconsideredoperationaleitherfrompermanentpumpsortheuseoftemporarypumps.Stormrelatedconstructionrepairandvariousstationimprovementshavebeenrecentlycompletedatsomestationsbutareongoingatothers.Theserepairswillincreasetheprobabilitythatthestationsremainfunctionalintheeventofamajorstormorpowerloss.Therepairsinclude,butarenotlimitedto,theinstallationofindustrialcapacitygenerators,fuelstoragetanks,electricaltransformers,andstormproofingofpumpmotors.Severalofthestationshaveundergonestructure‐relatedstormproofingmeasures,aswellasincludingnewstormwindowsanddoors.Additionally,manystationrooftops,wallframings,anddoorshavebeenreinforcedtoprovidegreaterresistancetotheforcessustainedduetohurricanewindgusts.

Itshouldbenotedthatsomestationsdidnothavecompletedrepairedattimeofinspectionorareoutofserviceduetopumpmaintenanceissues.ThreeSPSs(Station6,Dodt,andPlumOrchard)areunderconstructionandareusingportablepumpsateachoftheselocations.FiveSPSs(Burke,Lawrence,Bullard,Lamb,andLakeForest)havebeenrecentlycompletedandarenowinservice.TherearenoDPSsunderconstruction,asthelasttwostationshavebeenrecentlycompletedatDwyerandStation5withinthepasttwoyears.Whileallstationsareoperational,severalstationsarenotatfullcapacityduetoinoperablepumpsortheuseoftemporarypumps.

FACILITY MAINTENANCE TheFacilityMaintenanceDepartmentconsistsoffourunits:(1)PlantMaintenance,(2)Welding&Fabrication,(3)ElectricalMaintenance,and(4)MechanicalMaintenance.Theseunitsprovidemeterrepairs,removalsandinstallations,majorelectrical,welding,andfabrication,aswellasmechanicalmaintenanceforallSWBNOfacilitiesthroughoutthesystem,withtheexceptionofVeoliaWateroperatedsewagetreatmentplants.TheFacilityMaintenanceDepartmentpossessesthespecializedequipmentandtechnologynecessarytomaintaintheplantprocessequipment,drainagepumpingstations,sewagepumpstations,powergenerationequipment,andwatermeterservicing.Automatedlathesandmillslocatedinthemachineshopandbreakpress,aswellasshearandotherspecializedrepairequipmentlocatedintheweldingandfabricationshop,providetheabilitytofabricatepartswhenreplacementpartsareexcessivelyexpensiveornolongeravailableduetoequipmentvintagesuchasgearsandpartsforoldervalves.

Inaddition,newfacilitiessuchasTurbineNo.6havebeenbuiltwithintheSWBNOsystem,whichrequiresadditionalstafftobothoperateandmaintain.Theseadditionalassetspreventinhouserehabilitationandpreventativemaintenancefrombeingcompleted,whichcreatesalargebacklogofworkforthisdepartment.Currently,oneoftheirmajorrehabprojects,L3SedimentationBasin,includesacompleterebuildofgearboxes,drives,paddles,andotherequipmentandisplannedtobecompletedinaboutamonth,butisnotabletokeeponscheduleduetolimitedstaff.Previousbasins


22 OCTOBER 2016

werecontractedout;however,thisdepartmentmentionedthatmanytimesthatrequiresthemtoinspectandattimesredotheworkcontractorshavedonetokeepthesystemonline.AdditionalrehabworkincludesbearingworkonDrainagePumpStation11,whichisalsodelayedduetocurrentstaffinglevels.

Currently,theFacilityMaintenanceDepartmenthas60authorizedpositions.Mostofthehighlyskilledpositions(weldingandfabrication,electrical,mechanicalmaintenance)remainvacant.ThedepartmentisworkingongettingthosevacanciesreopenedthroughCivilService.Itwasnotedduringtheinterviewthattheresidencyrequirement,aswellaspayscales,preventedhiringpermanentstaffinthisdepartment.Additionally,staffmentionedequipmentusedtoconductworkhasreacheditsusefullife,suchasequipmentusedtofindhighvoltagelines,buckettruck,weldingtrucks,andotherequipment.

Currently,overtimeisnecessarytocompensateforthelimitedworkforce.Moreworkisbeingcontractedouttosubcontractorsthatwasusuallydonein‐housepriortoHurricaneKatrina.Manyofthesecontractorsarenotlocalandarenotalwaysabletoprovidetimelyserviceforcriticalpiecesofequipment.Thedepartmentispresentlyfacingalackofqualifiedpersonneltoadequatelysuperviseoroverseesubcontractors.Approximately27.9percentoftheFacilityMaintenanceemployeesarecurrentlyeligibleforretirementorwillbeeligibletoretirewithinfiveyears,includingthedepartmenthead.Thirteenpositions(mostlyhighlevelseniorsupervisorsinthemachineshop)arecurrentlyondropandcouldleaveinthenextfiveyears.Threesupervisorspersonnel,includingthedepartmenthead,areallscheduledtoretirebytheendof2016anddonothaveaplannedreplacement.Thedepartmentisactivelyrecruitingatjobfairs,andtradeschools.SWBNOisworkingonapartnershipwithalocalcommunitycollegetostartatradeprogramforskilledtradesandplansonhiringfromthatpoolofstudents.StaffnotedthattheyareworkingwithCivilServiceDepartmenttoassistincreatingmorerepresentationaljobdescriptionstogainexperienceandinterestedpersonnel.

ENGINEERING TheEngineeringDepartmentincludesMechanicalEngineering,ElectricalEngineering,CivilEngineering,ConstructionAdministrationandInspection,andNetworksEngineering.TheEngineeringDepartmentadministersmajorcontractsthroughouttheSWBNOfacilitiesandcoordinateswithotheragenciesforthedesignandconstructionactivitiesimpactingSWBNO‐maintainedfacilities.Currently,thedepartmentmanagesover60projectcontractsforbothFEMAandcapitalimprovementprojects.

ThestatusofmajorcontractsadministeredthroughtheEngineeringDepartmentisitemizedinthefollowinglist:

NewsludgelinetotheriverfromtheCarrolltonWPPisat80percentdesign.Constructionshouldbeginin2017.

L3sedimentationbasinsimprovementsareongoing,includingreplacingstaticmixerswithverticalmixers,addingspeedcontrollers,andrepairingflocculatordrives.RehabilitationofL3shouldbecompletedbytheendof2016.

TheSWBNOplanstoaddasludgedryertotheEastBankplant.Partofthatprojectistheadditionofanewairemissionsystem,whichiscurrentlyunderdesign.



AnarcflashstudyisbeingconductedonelectricalequipmentforsafetypurposesandaspartofvariouselectricalupgradesatWPPs.

ChemicalfeedstorageimprovementstoaddadditionalchemicalstorageattheCarrolltonWPP.

Thefilterbackwashpumpreplacementiscurrentlyindesignphase(60percent)andwillbeunderconstructionin2017

Thewaterhammerproject,whichwillinstalltwonewelevatedtanksatCarrolltonWPP,iscurrentlyouttobid.

Therecyclepumpimprovementsdesigniscompleteandconstructionwillendin2016.

RehabilitationofTurbine4isongoingandwillbecompletedbytheendof2016.

FiltermediarehabatAlgiersWPPiscurrentlyscheduledbuthasnotbegun.Newinstrumentationwasaddedtothefiltergalleriestodisplayflowandheadloss.

BuildingorupgradingthecitycanalsystematFloridaandLouisianaavenuesiscurrentlyunderconstruction.

G4BasinrepairsatCarrolltonWPParecurrentlyinthebidphase.

Arecentemergencyrepairofriverintakestationshitbyashipisinprogress.

RehabofClarifier2atEastBankplantisinthedesignphase.

NewsludgedryeratEastBankplantiscurrentlyat60percentdesign.

NewRASlineatEastBankplantiscompleteandworkisbeingdonetotietheRASpumpsintothelinebeforetakingthetemporarylineoff‐line.Thistie‐inshouldbecompletedin2016.

ThepipingfromtheEastBankplanttotheexpansionanddemonstrationcellswascompletedin2016andtreeplantingshouldstartin2016.TheA2projectiscurrentlyonhold.

FloodmitigationcontractsforninesewagepumpstationswereawardedandtheEngineeringDepartmentissupervisingthesecontracts.Eightstationsarecurrentlyunderconstructionandscheduledtobecompletedbytheendof2016andoneStationiscurrentlyunderdesign.

AtCarrolltonWPP,fueltanksarebeingreplacedwitha250,000gallonabove‐groundstoragetank,whichiscurrentlyunderconstruction.

Apowerplantprojecttoimprovevalves,steamline,auxiliarypower,andaddresssteelwasbidandworkisongoing.

10majorunderground25cycleelectricalfeedersarebeingreplacedthroughouttheSWBNOfacilities.Theprojectiscurrentlyunderconstruction.Thisprojectisthefirstdesign‐buildprojectfortheSWBNO.

AdditionalprojectsplannedbytheEngineeringDepartmentincludethefollowing:

OldRiverIntakeStationrehabilitation.

ThebulksodiumhypochloritesystemsattheEastandWestBankwastewatertreatmentplantsarebeingreplacedwithgaschlorine.

TurbinesNo.5and3arebeingrehabilitated.


24 OCTOBER 2016

NewlimestorageandfeedfacilitiesatbothWPPs.

AnewchemicalstorageandfeedfacilityatCarrolltonWPP.

AnewfiltergalleryadditionattheCarrolltonWPP.

Variouswaterprojectsthatincludefilterrehab,valverehab,andpumpreplacement.

Inadditiontocontractadministration,theEngineeringDepartmentiscurrentlyaddinggeographicalinformationsystem(GIS)technologytofurtherenhancetrackingwaterdistributionandsewerpipingcapabilities.TheFEMA‐fundedwatermainreplacementandemergencysewersystemassessmentrequiresGIStoidentifyandfixbrokenorleakingpipesinthewaterdistributionandcollectionsystem.Itwasnotedduringtheinterviewthatfundingfordrainageimprovementsprojectsisneeded.Intermsofstaffing,thedepartmentneedstohiremoreelectricalengineers(duetoupcomingretirements)tomanageelectricalcontractsandreviewelectricaldesignwork.

NETWORKS TheNetworksDepartmentischargedwithmaintainingthesanitarysewersystemandthepotablewaterdistributionsystem.ThewaterdistributionnetworkthatwasdamagedbyuprootedtreesandotherdebrisduringHurricaneKatrinahasnotbeenfullyrepaired.Consequently,theCarrolltonWPPiscurrentlypurifyingapproximately135mgdofwaterwhileserving92percentofthepre‐Katrinanumberofaccounts.PriortotheleveefailurecausedbyHurricaneKatrina,theplantwaspurifyingapproximately115mgdofwater.

TheNetworksDepartmentisdividedintosevenzones.Zone2operatesthebarricadeunitmakingstreetandlaneclosures,providingvisibilityaroundmaintenancesites,andperformingpreventivemaintenanceactivitiessuchasexercisingvalvesandmaintainingfirehydrants.Zone7hastheafter‐hourscrews,whichrespondtoemergencycallsandprovidelimitedsurfacerestorationsforrepairexcavations.Zones1,3,4,5,and6representgeographicalareasinNewOrleansthatproviderepairservicesfortheirrespectiveareas.Eachzonehasastaffofapproximately20to35personswhoareresponsibleforrepairswithinthedesignatedareas.Typically,athree‐mancrewwillcompleteaworkorder.Morecomplexworkordersmayrequireadditionalcrewsonasingleworkorder.Contractorsareusedtosupplementrepairworkperformedwithineachoftheareas,ifsufficientmanpowerwithintheSWBNOisnotavailabletoperformnecessaryrepairs.

AccordingtoSWBNOpersonnel,thebiggestchallengeistokeepupwiththerateofrepairsneededduetotheincreaseddecayrateofthedistributionandcollectionsystems.TheNetworksDepartmentisfindingithardertokeepupwiththeamountofreactiverepairsoccurringwithinthesystemswithcurrentstaffinglevels.Itwasalsonotedthattheincreaseinresidentialdevelopment(newinstallations)andincreaseincityevents(runs,bike‐a‐thonsetc.)hasalsocreatedadditionalworkload,aswellasdelaysincompletingworkwithinthesystems.Lastly,equipment(backhoes,excavators,flushtrucks)andfleetbreakdownshavealsobeenanissueoverthelastyear.

TheSWBNOconductedasystemevaluationofthepipingsystemtodetectleaks.Theefforttofindleaksisongoingandthedepartmentistryingtofocusmoreonliningandreplacement,aswellasrepairsinboththewaterdistributionsystemandsewercollectionsystem.Intermsofstaffing,thedepartmentisveryshort‐staffedbothinengineeringandmaintenance.Thedepartmentrecentlylost



severalkeyengineeringpersonnelthatprovidedtechnicalsupportandcontractmanagement.Moreseniorlevelengineeringstaff,aswellasengineeringinterns,isneededtotrainlessexperiencedstaff,providetechnicalsupporttothecrews,andmanagecontracts.Additionally,highturnoverwasnotedasaprobleminthecrewsbycivilserviceduetoalackofqualifiedcandidates.Thedepartmentdoeshaveaninternaltrainingprogramformaintenanceandengineeringstaff.Over1,500watermainswererepairedin2015.IdentificationofleaksisongoingandtheSWBNOwillcontinuetoincorporateidentifiedleaksintothewatermainreplacementprogramfundedbyFEMA.AspartoftheESSAprogram,manholesarealsobeinginspectedasanongoinginspectionofthesewersystem.Over1,900sewerrepairswerecompletedin2015.InadditiontotheFEMA‐fundedprojects,Networksalsorespondstorequestsforvalveclosuresbycontractorsandthecity.

TheNetworksDepartmentworksinconjunctionwiththeNewOrleansFireDepartmenttomonitorandmaintainallfirehydrantslocatedintheSWBNO’sservicearea.TheNetworksDepartmentinspectsallfirehydrantswithinthesystem.Allcityhydrantshavebeenmappedandassignedanidentificationnumber.Thefirehydrantsprogramrequiresthe16,500firehydrantsinthedatabasebeinspectedonceeverytwoyearstosupplementthesemiannualinspectioncycleoftheFireDepartment.In2015,thedepartmentinspectedover6,300hydrants.

TheNetworksDepartmentcompletedover4,000pavingprojectsin2015,bothin‐houseandincooperationwithcontractors.Thisdepartmenthasseveralmaintenancecontractstoassistwiththemaintenanceofthewaterdistribution,wastewatercollection,anddrainagestations.Thesecontractshaveincreasedtheamountofworkaccomplishedwithinthedivision.

SUPPORT SERVICES TheSWBNOowns790piecesofrollingstock,whichincludestrucks,backhoes,andsewercleaningequipment.Theavailableequipmentisbeingassignedtothevariousdivisionsbasedontheneedsofalldepartments.Fortysixnewpiecesofstock(trucks,pumptrailersetc.)wereobtainedbythedepartmentin2015andanadditional38piecesofnewstockwereobtainedasofMay17,2016.

TheSupportServicesDepartmentperformsmostall‐groundmaintenancefunctions.Inaddition,SupportServicesoperatesthewarehousethatstoresvalves,pipe,hydrants,tools,etc.,requiredbytheNetworksDepartmentforrepairofexistingwaterdistributionandsewerpipelines.

SupportServicesalsooperatesgaragesforvehiclerepair.ThegarageareaswereheavilydamagedduringHurricaneKatrina.Garage1wasrehabbedin2015‐2016.Currently,thecontractorisworkingonpunchlistitemswithsubstantialcompletionscheduledforJuly2016.AdditionalelectricalworkneedstobecompletedbytheSWBNOandoncethatworkiscompleted,anoccupancypermitwillbeissuedbythebuildingdepartment.Thisworkandpermitareexpectedtobecompletedby2016.Garage2iscurrentlybeingrehabbedandhasbeendelayedduetoelectricalworkandshouldbecompleteinearly2017.

AnewSiteRelocationFacilitywasconstructedin2014tohousepersonneluntilthegaragerenovationsarecompleted.Currentlystaffandmaterialsfrombothgaragesarebeingstoredinthesiterelocationbuilding.Ultimately,theSiteRelocationBuildingwillalsobeusedtohousetheBodyRepairShopofGarage2.


26 OCTOBER 2016

FEMAcontinuestoreimburseequipmentandtoolsforeachgaragelosttothehurricaneinadditiontoreplacingsomeofthebuildings,suchastheAnnexBuilding,whichwillbeusedtohouselockerrooms,showerfacilities,trainingrooms,CDLtrainingunit,etc.VariousotherprojectsbeingcompletedorbeingconductedwithinSupportServicesare:

Sixnewvacuumtruckswerepurchasedin2015andarrivedonsitein2016.Supportservicesarecurrentlyleasingfivetruckstoensureenoughtrucksareavailable.

Reductionintakehomevehiclesisongoingfrom2015.

Anewcontractorwasassignedtomitigateproblematicvegetation(lilies)inthecanalsystemsin2015andhasmadesignificantheadwayonthereductionoflilies.Thedepartmentcontinuestousethiscontractorformitigation.

NewcontractforsecurityforallSWBNOfacilitieswasrecentlyawardedandwentintoeffectusinganewsecuritycontractor.

SupportServicesisnowrequiredtocoordinatewithFacilityMaintenanceforday‐to‐dayactivitiesandneedsattheWPPs.ThisdepartmentisfocusingonstaffingthegroundmaintenancedepartmenttomaintainalargerportionoftheSWBNOfacilities.Currently,acontractorisusedfortheEastBankandthedepartmentmaintainstheWestBank.

Majorchangetojanitorialservicesoccurredin2016toincludemorefacilities.

Hiringnewemployeesinallareasofsupportservicesincludingmechanicsetc.tohelpsupportalldepartmentswithinSWBNO.Thedepartmentnotedthatmostofthestaffisapproachingretirementageand,asaresultoftheseretirements,willbeshortstaffed.

Futureprojects/concerns:

HVACsystemattheSt.Josephbuildingisinneedofrehabilitation.Currently,itisnoteffectiveinkeepingthebuildingcoolatalltimes.Theconceptualdesignwascompletedinearly2016andisscheduledtorehabtheHVACinlate2016.

OneelevatorintheSt.Josephbuildingisinoperable.Repairsorreplacementisneeded.TheEngineeringDepartmentisworkingonbiddocumentsandtheprojectshouldbecompletedin2017.

AnewbuildinggeneratorisbeinginstalledattheSt.Josephbuilding.Thebuildingiscurrentlyonaportablegenerator.Theprojectwillincludeanewgeneratorwithanautomatictransferswitch.

TheCentralYardFacilityplanstoaddanadditionalparkinglotandreplacethefencearoundthebuilding.Thisprojectisonholdduetoplannedstreetwork.

SupportServicesphonesystemwillbeupgradeoncetheCarrolltonWPPiscompleted.Thisprojectisstillpending.

ENVIRONMENTAL AFFAIRS TheEnvironmentalAffairsDepartmentoverseestheconsentdecreeandalladministrativeorders.ThisdepartmentreportstherearesewerbypassesandoverflowtotheRegion6EPA.Someactivitiesbeingundertakenbythedepartmentincludethoselistedbelow:



Continuetomonitorindustrialusersthroughthepretreatmentprogram.

Permitcomplianceinair,water,wastewater,stormwatermanagement,solidwaste,andundergroundfuelstoragetanks.

TheconstructionofthepipingfortheEastBankSewageTreatmentPlantwetlandsassimilationhasbeencompleted.Thepipingallowstreatedeffluenttobedischargedtothedemonstrationandexpansioncells.Currently,SWBNOhasapermitfromLDEQtodischargetothedemonstrationcellsbutcurrentlynopermithasbeenissuedtodischargeintotheexpansioncells.SWBNObegandischargingtothedemonstrationcellinMay2016.Cypressandtupelotreeswillbeplantedinthedemonstrationcellsin2016.LDEQhasnotprocessedthepermitapplicationfortheEastBankWastewaterTreatmentPlantandcannotdischargeintotheexpansioncellsuntilapermitisissued.TheconstructionoftheA2project,ajointagreementofawetlandsassimilationprojectbetweenSt.BernardParishandSWBNOhasnotbeenfinalizedandconstructionhasnotbegun.

ThecomponentsofthepretreatmentprogramincludemonitoringthedischargeoftheEastandWestBankSewageTreatmentPlantsinadditiontoothersignificantindustrialusersduringtheyear.Oneadditionaluserwaspermittedin2015(ChurchillDownsLouisianaHorseracingCompany,LLCd/b/aFairGroundsRaceCourse).AnannualreportisalsosubmittedtoLDEQtodemonstratepretreatmentperformance.

Inaddition,yearlyrevenuehasbeenreceivedfromthefollowingsourcesassociatedwiththepretreatmentprogram:

Industrialusersbilledmonthlyforexcessstrengthsurcharges. Sanitaryseweragedischargedtothewastewaterplantfromspecialevents. Septagedisposalprogram.

Thetotalrevenuereceivedin2015fromthesesourceswas$1,034,527.61.

Noairpermitswereobtainedin2015.TheuseofdieselpoweredunitstoprovideemergencypowertodrainagepumpstationsandotherSWBNOfacilitiesrequiredthesefacilitiestomeetairqualityregulations.

SWBNOcontinuestoutilizecompliancesoftwareforairqualityprogramsattheCarroltonWPP.AllTitleVAirPermitreportsfortheEastBankSewageTreatmentPlantandwerefiledontimeandtherewerenopermitviolationsin2015.

TheMunicipalSeparateStormsewersystem(MS4)PermitforOrleansParishismanagedbytheSWBNO.TheBoard,alongwithco‐permittees,mettherequirementsfoundinthepermitandwasdocumentedintheannualreportfiledonMay1,2015.

EnvironmentalAffairsusedacontractorforstormwatersamplingrequiredfortheM4permit.Thedepartmentpurchasedsamplingequipmentin2016andsamplingisnowdonecompletelyin‐housebydepartmentstaff.Allrequiredsamplesweresuccessfullycollectedbydepartmentstafftomeet2015permitrequirements.AdditionalprojectsthisdepartmentincludesstartingaFats,OilsandGrease(FOG)programweretheSWBNOwillbeissuingpermitstorestaurantwithgreasetraps.TheSWBNOwillalsocontinuewithitsgreeninfrastructurepilotprogramwhichfocusesoncommunityoutreachandeducation.TheEnvironmentalAffairsDepartmentneedstohiremorestaffforthetasks


28 OCTOBER 2016

necessarytomaintaincompliancewithallthevariousrulesandregulationswhichapplytotheSWBNO.TheyareintheprocessofhiringmorestaffsuchasaSenior,AssociateandInternlevelCityPlanners,oneEnvironmentalTechnicianII,andfiveEnvironmentalTechniciansItoassistwithongoingtasks.Thedepartmentdidnotexpressconcernsaboutfindingqualifiedcandidatesforthesevacancies.

STATUS OF CONSENT DECREE FOR SEWERAGE SYSTEM TheSWBNOiscomplyingwiththeEPARegion6andDepartmentofJusticeconsentdecree,whichrequirescessationofunauthorizeddischargesandthedevelopmentofascheduleforrepairstoboththecollectionsystemandthetreatmentplant.

Someprovisionsoutlinedintheconsentdecreeincludethoselistedbelow:

Quarterlyandannualreportingrequirementsaretobesubmittedtotheregulatoryagency.

TheSWBNOwillmeetthepreventivemaintenancerequirementsoftheconsentdecree.

Collectionsystemrepairswillbeginoncethehurricanedamagetothesewagepumpstationshasbeenrepaired.

TheSWBNOisincompliancewiththeconsentdecree.Ithasmeteveryconstructionandreportingdeadlineinthedecreeandhashadnofinesrelatedtoconstructionorreportingschedulesin2015.

SUMMARY OF FINDINGS Thefollowingitemsareasummaryofthefindingsduringthesiteinspections:

Themanagementteamconsistsofindividualswithsignificantwater,sewerage,anddrainageexperience.ThisexperiencehasbeendevelopedbothinternallyatSWBNOandatotherrespectedwaterandsewerutilities.

SimilartowaterandsewerutilitiesacrosstheU.S.,theSWBNOdepartmentsarefacedwithasignificantnumberofpendingretirements.Approximately24percentofcurrentemployeesareeitheronthedeferredretirementoptionplan(DROP)orareeligibleforretirement.Unlesstheseemployeesarereplacedwithqualifiedindividuals,thesependingretirementsposeasignificantthreattoSWBNO’sabilitytoperformitscoreoperationalandadministrativefunctions.SuccessionplanningandrecruitmentofqualifiedemployeeswillbeakeyelementforSWBNOtomitigatethependingretirements.

Manykeysystem‐wideprojectsthatwereindesignphasein2015arecurrentlyouttobidandwillbeunderconstructionsuchasthewaterhammerproject.

Severaldepartmentsareexperiencingvacancies,includingtheWaterPurificationunitoftheOperationsDepartment,aswellastheFacilitiesMaintenanceandNetworksdepartments.SWBNOneedstoaddressthesevacanciesassoonaspossibletoensureeffectiveoperationalandmaintenanceperformanceandadministrativeoversight.Additionally,itwasnotedwhileon‐sitethatthereisaneedfortrainingprograms,especiallyforWPPsoperationsstaff.ItwasrecommendedatthesiteinspectionthatprocessoperationsmanualsbedevelopedfortheWPPstoprovideguidancetoentrylevelandseniorleveloperatorstoensuretheWPPsareoperatedconsistently.



TheSWBNOhasaclearunderstandingoftheexistingconditionsofthedrainage,waterandsewagefacilities,andisawareoftheimmediateneedswithineachdivisionandarea;however,fundingisneededfortheSWBNOtoaddresstheseissues.WaterandsewercustomerrateincreaseshavebeenapprovedandtheSWBNOiscurrentlyprioritizingimmediateneedssuchasfilterrehabilitationattheCarrolltonWPP.

TheSWBNOhasstartedtoinitiatethefilterrehabilitationprogramattheCarrolltonWPP,asthefiltersystemisinneedofextensiverepairsduetoleakingpipes,brokenvalves,brokenactuators,andfiltermediabeingattheendofitsexpectedservicelife.MediarehabisunderwayattheClaibornefiltergalleryandscheduledfortheAlgiersWPP.

Therateofdecayofthepotablewaterdistributionnetworkandthesanitarysewercollectionsystempresentsthetwobiggestchallenges.Linesarebeingreplacedorrepairedwhereleakshavebeendetectedbythecontractor.NetworksDepartmenthasexperiencedhighturnoverratesinstaffinthemaintenancecrewsaswellasintheEngineeringDepartmentrecently.Thissituationhasaddedtothestressofdealingwiththerateofdecayandsystemneeds.

BasedontheSPSandSLSinspection,allDPSsandSLSsareconsideredoperationaleitherfrompermanentpumpsortheuseoftemporarypumps.ThreeSPSs(Station6,Dodt,andPlumOrchard)areunderconstructionandareusingportablepumps.FiveSPSs(Burke,Lawrence,Bullard,LambandLakeForest)havebeenrecentlycompletedandarenowinservice.

Thesewageplantsaremeetingpermitexceptforsevenexcursionsin2015.Thesevenexcursionsoccurred7daysinarowattheEastBankWWTP;anonsitecontractoraccidentlyplacedgritintotheeffluentchannel,whichresultedinanexceedanceofeffluentmaximumdailyconcentrationforfecalcoliforms.TheSWBNOandthecontractoperator,Veolia,haveaddressedeachissue.


30 OCTOBER 2016

Water Department

ADHERENCE TO WATER REVENUE BOND RESOLUTION REQUIREMENTS In2014,theSewerageandWaterBoardsold$103,525,000ofWaterRevenueandRefundingBonds.ThesaleofthesebondshasobligatedtheBoardtofulfillthecovenantsofthecurrentbondresolutions.Thecovenantsaredesignedtoprotecttheinterestsofthebondholders.ParticularcovenantsoftheBoardintheGeneralWaterRevenueBondResolutionpertaintothepaymentofindebtedness;limitationsonindebtedness;covenantsandrepresentationsoftheBoard;covenantswithcreditbanks,insurers,etc.;operationandmaintenance;freeservice,completingservice,billingandenforcementofcharges;saleorencumbranceofthesystem;insurance;damage,destruction,condemnationandlossoftitle;recordsandaccounts,inspectionsandreports;andthecapitalbudget.TheRequirementsofthe2014GeneralWaterRevenueBondResolutionadoptedonMay21,2014,(hereaftercollectivelycalledtheGeneralResolution)arediscussedinthissection.WaterDepartmenttablesareincludedattheendofthissection.

TheBoardwasincompliancewiththe2014GeneralWaterRevenueBondResolutionin2015.

Payment of Indebtedness; Limited Obligations

TheGeneralResolutionobligatestheBoardandtheBoardofLiquidation(BOL)topromptlypaytheprincipalandinterestonallseniorandsubordinatedebtthatareobligationspayablefromthenetrevenuesofBoard.

Limitations on Indebtedness

TheBoardmustnotissuebonds,otherseniorparityindebtednessorsubordinatedebtunlessitcomplieswithSections4.03,4.04or4.05oftheGeneralResolution,asapplicable.

Covenants and Representations of Board

TheGeneralResolutiongivestheBoardthepowertoissuebondsandpledgetherevenuesaccordingtotheresolution.Inaddition,theBoard“…faithfullyobserveandperformallcovenants,conditionsandagreementsonitspartcontainedinthisResolution,ineveryissueofIndebtednessissuedhereunderandinallproceedingsoftheBoardpertainingthereto.”

Covenants with Credit Banks, Insurers, etc.

TheBoardmaymakecovenantsandagreementsinasupplementalresolutionwithanyinsurer,creditbankorotherfinancialinstitutionthatagreestoinsureortoprovideacreditfacilitytotheBoard.ThesecovenantsandagreementsshallbebindingontheBoardandalltheholdersofindebtednessthesameasifsuchcovenantsweresetforthintheGeneralResolution.

Operation and Maintenance

TheBoard“…shallestablishandenforcereasonablerulesandregulationsgoverningtheuseofandtheservicesfurnishedbytheSystem,shallmaintainandoperatetheSysteminanefficientandeconomicalmannershallmaintainthesameingoodrepairandsoundoperatingconditionandshallmakeallnecessaryrepairs,replacementsandrenewals.”Inaddition,allcompensation,salaries,feesandwagespaidbytheBoardshallbereasonable.Finally,theBoardshallobserveandperformthetermsandconditionscontainedintheSewerageandWaterBoardAct(PartIIIofChapter9ofTitles


BLACK & VEATCH | Water Department 31

33oftheRevisedStatutesofLouisiana,asamended),and“complywithallvalidacts,rules,regulations,ordersanddirectionsofanylegislative,executive,administrative,orjudicialbodyapplicabletotheSystemortheBoard.”

Free Service, Competing Service, Billing and Enforcement of Charges

TheBoardshallnot“…provideanyservicesoftheSystemwithoutmakingachargethereforinaccordancewiththeBoard’sscheduleofrates,feesandcharges…otherthanthoseconnections,useorservicesalreadyinexistenceorasmayberequiredbylaw…”Inaddition,theBoardmaynot“…provide,grantanyfranchisetoprovideorgiveconsentforanyoneelsetoprovidesuchserviceswhichwouldcompetewiththeSystemunlesstheBoarddeterminesthatsuchfranchise…wouldprovideservicesthattheBoardhasdeterminedarenotinitsbestinteresttoprovideandwouldnotmateriallyimpairtheinterestsoftheholdersofindebtedness.”

TheBoardwillbillcustomersforservicesontheregularbasisandiftherates,feeorotherchargesarenotpaidwhendue,theBoardshall“…totheextentpermittedbyapplicablelawsandregulations,disconnectthepremisesfromtheSystemorotherwisesuspendservicetosuchpremisesuntil…”delinquentrates,feesorotherchargeshavebeenpaidorapaymentplanhasbecomeeffective.

Sale or Encumbrance of System

TheGeneralResolutionrequiresthat,withexceptions,“…neithertheSystemnoranyintegralpartthereofshallbeleased,sold,mortgagedorotherwisedisposedof…”

Insurance

TheBoard“…shallcontinuouslymaintaininsurancewithrecognizedresponsiblecommercialinsurancecompaniesagainstsuchrisksandinsuchamountsasarecustomaryforpublicbodiesowningandoperatingsimilarsystems…”

Damage, Destruction, Condemnation and Loss of Title

TheBoardshallrestore“…propertydestroyedordamagedtosubstantiallythesameconditionasbeforesuchdestruction,damage;condemnationorlossoftitle…”

Records and Accounts; Inspections and Reports

TheBoardisrequiredto“…keepproperbooksofrecordsandaccounts…showingcompleteandcorrectentriesofanytransactionsrelatingtotheSystem….”

TheBoardisalsorequiredtofilewiththeBoardofLiquidation,CityDebtanannualreportwithfinancialstatementsauditedbyandcontainingthereportofanationallyrecognizedindependentpublicaccountant.Theauditor’sreportistoincludeastatementthatduringtheirexamination,madeinaccordancewithgenerallyacceptedauditingstandards,nothingcametotheirattentionthatwouldleadthemtobelievethatadefaulthadoccurredundertheresolution,ortostatethenatureofthedefault.

TheBoardengagedthefirmsofPostlethwaite&NettervilleandBruno&Tervalontocomplywiththiscovenant.FinancialreportswiththeAccountants’CertificatehavebeenfurnishedtotheBoardofLiquidation,CityDebtandhavebeenreproducedforpublicdistribution.TheGovernmentFinance


32 OCTOBER 2016

OfficersAssociation(GFOA)hasawardedtotheBoardthe“CertificateofAchievementforExcellenceinFinancialReporting”fortheirannualfinancialreportsfor29years.

Capital Budget

TheBoardisrequiredtoadoptanannualmulti‐yearfinancialplanforcapitalexpensesforaminimumof5futureyears.

2015 WATER DEPARTMENT OPERATIONS FundsfortheoperationandmaintenanceofWaterDepartmentpropertieswerederivedfromsalesofwater,delinquentfees,plumbinginspectionandlicensefees,chargesfordisconnectionsandreconnections,andfrominterestearnedonavailablefunds.Analysesofthe2015WaterDepartmentoperationsarediscussedinthefollowingparagraphs.

Water Use

AccordingtostatisticsprovidedbytheBoardduring201551,563,490,000gallonsofwaterwerepumpedbytheWaterDepartment.Watersalesaccountsfor13,810,201,200gallonsand653,326,900gallonsweremeteredtoCitydepartmentswithoutcharge.Meteredtreatmentplantprocesswatertotaled645,330,500gallons.Theremaining36,454,628,400gallonsresultedfromunmetereduses,suchasfireprotection;flushingstreets,sewers,drains,andgutters;andunaccountedforsystemlosses.

Number of Customers

Table2presentsasummaryofthehistoricalandprojectedaveragenumberoftreatedwatercustomersfortheperiod2011through2020.Basedonyear‐endbillingsummaries,thenumberofmonthlybilledcustomersduring2015averaged129,809comparedwith127,876for2014.ItisprojectedthattheBoardwillaverageapproximately131,721openaccountsin2016andthatthenumberofaccountswillcontinuetogrowatapproximately1percenteachyear.

Inadditiontoregularcustomers,waterissoldtoconstructioncontractorsandothercustomersonanirregularbasis.TheBoard,bylaw,alsoprovideswaterservicefreeofchargetocertainmunicipalandpublicconnectionsincludingtheBoarditself.In2015therewere1,119connectionsinthisgroup,comparedwith1,128for2014.

Billed Water Usage

Table2alsopresentsasummaryofhistoricalandprojectedtreatedwatersales.Basedonyear‐endbillingsummaries,atotalof14,000milliongallonsofwatersaleswerebilledonamonthlybasisin2015,comparedwithatotalof13,504milliongallonsin2014.Overthepastfewyears,theBoardandotherwaterutilitiesoperatingintheUnitedStateshaveexperiencedminimaltonogrowthinwaterusageandinsomecases,adecline.Asaresult,aresistancefactorisappliedtotheprojectedannualusagepercustomerforeachcustomerclasstoreflecttheimpactofpriceelasticityandthetrendofdecreasingpercapitaldemandduetoconservationeffortsandmoreefficientwaterfixtures.Thevolumeofwatersoldisprojectedtodecreaseapproximately0.4percentperyearbeginningin2017.

Operating Revenues

The2016scheduleofratesforretailtreatedwaterserviceispresentedinTable3andreflectsa10percentrateincreaseover2015rates.Theratesconsistofmonthlyservicecharges,whichvaryby



metersize,plusa4‐stepdecliningblockvolumecharge,withtheexceptionofthefirstblock,whichisalife‐linerelatedcharge.CurrentratesforflatratefireservicearealsoshowninTable3.Separaterateschedules,notshown,areusedforbillingwatersoldtoconstructionprojectsandotherpurposes.

AsummaryofhistoricaltreatedwaterbillingsandotherWaterDepartmentrevenueispresentedinTable4fortheperiod2011through2015.ThehistoricalrevenuesshowninTable4weredevelopedfromdetailedrecordsprovidedbyBoardStaff.Operatingrevenuesarederivedfromchargesforsaleofwateranddelinquentfees.Salesofwaterin2015were$76,719,113which,whencomparedwith$69,601,809for2014,showsanincreaseofapproximately10.2percent.Delinquentfeerevenueswere$1,288,824in2015whichrepresenta6.0percentincreaseover2014delinquentfees.

Non‐Operating Revenues

AlsoshowninTable4,non‐operatingrevenueoftheWaterDepartmentincludesinterestearnedoninvestedfunds,andotherincomefrommiscellaneoussources.During2015,non‐operatingrevenueincluded$966,017ofinterestearnedfromtheinvestmentofavailablefundsintheWaterSystemFundandtheWaterRevenueBondAccountand$3,982,665fromothersources.

Operation and Maintenance Expenses

Table5presentsasummaryofhistoricalexpenses.Expendituresin2015increasedabout12.8percentfrom2014expendituresandincreasedabout22.1percentfrom2013expenditures.HistoricaloperationandmaintenanceexpensesshowninTable5donotincludethenon‐cashportionofProvisionforClaimsasrecordedintheComprehensiveAnnualFinancialReport.EstimatesoffutureWaterDepartmentclaimsareincludedonLine14ofTable12.

Capital Budget and Expenditures

CapitalexpendituresoftheWaterDepartmentincludethecostofreplacementsandimprovementstowaterworksfacilities,thewaterdistributionsystem,andtheWaterDepartmentproratashareofpowerprojectsandgeneralbudgetcosts.

TheWaterDepartment’s2015capitalexpenditurestotaled$38,546,813.TheWaterDepartment’scapitalimprovementexpendituresfortheyearareshowninTable6.

Summary of Operations

ThefollowingtabulationshowsasummaryofthereceiptsandexpendituresoftheWaterDepartmentduring2015:

Total Revenues $82,956,619

Operation and Maintenance Expense 78,264,668

Claims 813,979

Debt Service Payments 5,176,250

Revenue Primarily Available for Capital Expenditures a ‐1,298,278a Excludes depreciation.


34 OCTOBER 2016

PROPOSED CAPITAL IMPROVEMENT PROGRAM Table7presentsasummaryoftheprojectedmajorcapitalimprovementprogramfortheperiod2016through2020.Table7isbasedontheBoard’s2016‐2025CapitalProgram.Thefive‐yearmajorcapitalimprovementprogramcostsareestimatedtototal$426,464,000.About54percentofthisamount,or$231,587,000,isforrecurringannualcapitalimprovements,withtheremaining$194,877,000formajorimprovements.Theproposedroutineannualcapitalexpendituresforwatersystemimprovementsandextensionsinclude$35,703,000,fortheWaterDepartment’sshareofpowerprojects,and$69,279,000foritsshareofgeneralbudgetitems.

ABILITY TO FINANCE PROPOSED CAPITAL EXPENDITURES ThissectionofthereportanalyzestheadequacyofprojectedrevenuestofinancetheproposedcapitalimprovementsshowninTable7.

Operating Revenues

OperatingrevenuesoftheWaterDepartmentconsistofrevenuesfromwatersales.Projectedoperatingrevenuesfortheyears2016through2020areshowninTable8.TheseestimatesreflecttheratescheduleeffectiveJanuary1,2016appliedtotheprojectednumberofcustomersandwaterusageandareprojectedtodecrease,onaverage,about0.2percentperyearthroughoutthestudyperiodduetheanticipateddeclineinwaterconsumption.ProjectedrevenuefromadoptedrevenueincreasesisalsoshowninTable8.

Other Revenue Sources

Baseduponpastpractices,theWaterDepartmentcanexpecttoobtainrevenuesorfundsfromnon‐operatingsources.Theseincludeinterestearnedonavailablefunds,participationbyothers,houseconnectioncharges,fireconnections,firehydrantrelocations,andvariousotherincomesources.Also,byBoardpolicy,theWaterDepartmentreceivesone‐halfoftheplumbinginspectionandlicensefeescurrentlyprojectedat$299,700peryear.

Interestincomefromtheinvestmentoffundsheldforfutureusedependsuponthelevelofwaterrevenueavailableforinvestmentandtheamountofrevenueaccruedtowardspaymentoffuturecapitalexpenditures.

Projectionsofotherrevenuesourcesarepresentedinasubsequenttable,whichsummarizestheDepartment’sfinancialpositionduringthefinancingofprojectedoperatingandcapitalrequirements.


Asummaryofprojectedoperationandmaintenanceexpensefortheperiod2016through2020isshowninTable9.Estimatesoffutureexpensesarebasedonanticipatedfutureoperatingconditionsandallowancesforinflationaryfactors.

Projectionsoffutureoperatingandmaintenanceexpensesforthestudyperiodarebasedon2015actualexpensesprovidedbytheSWBNOandananalysisofthecurrentandanticipatedoperatingconditionsandtrends.



Debt Service Requirements

FuturedebtservicerequirementsoftheWaterDepartmentaremadeupofprincipal,interest,andreservefundpaymentsforcurrentlyoutstandingandfuturewaterrevenuebondissues.AsofDecember31,2015,outstandingdebtobligationsconsistedof$103,525,000WaterRevenueandRefundingBonds,Series2014and$100,000,000WaterRevenueBonds,Series2015.

Toadequatelyfundtheproposedcapitalimprovements,additionalrevenuebondsareindicatedasshowninTable10.ItisanticipatedthattheBoardwillissuerevenuebondsintheamountof$90,000,000in2017and$34,000,000in2019.ProjectedbondsshowninTable10for2016through2020areassumedtobesoldatanaverageannualinterestrateof5.5percentforatermof30yearswith1yearofcapitalizedinterest.

TheWaterDepartmenthasborrowedfromtheCityofNewOrleansDepartmentofPublicWorks(DPW)andfromtheDrainageDepartment.Itisanticipatedthatthesefundswillbereimbursedduringthestudyperiod.

Adequacy of Revenues to Finance Proposed Capital Improvements

TotalrevenuerequirementsfortheWaterDepartmentrecognizedforpurposesofthisreportincludeoperationandmaintenanceexpense,allowanceforclaims,debtservicecostsonmajorcapitalimprovementsfinancedthroughthesaleofbonds,andexpendituresforcapitalimprovementsnotfinancedfrombondproceeds.Table11examinesthefinancingofthemajorcapitalimprovementprogramandTable12summarizesthefinancingofoperationandmaintenanceexpense,debtservicecostsonoutstandingandproposedbonds,andthetransferofoperatingfundsformajorcapitalimprovementfinancing.

Capital Projects Funding

Table11presentsthemajorcapitalimprovementfinancingplanwhichsummarizestheprojectedsourceandapplicationoffundsoverthefive‐yearstudyperiod.TheamountofFundsAvailableatBeginningofYear,shownonLine1,is$143,667,000.ThisamountisbasedonauditeddataprovidedbytheBoard.

Projectedrevenuebondproceeds,totaling$124,000,000,areshownonLine2.Theamountsandyearsofissuearedevelopedbyconsideringcapitalprogramneeds,currentpolicies,othersourcesofmajorcapitalimprovementfinancing,andthedebtservicecoveragerequirementsofthebondcovenantsregardingtheissuanceofparityrevenuebonds.

Financingofthemajorcapitalimprovementprogramanticipatesthetransferofatotalof$30,500,000ofoperatingrevenueasshownonLine3.OthersourcesoffundsavailabletomeetmajorcapitalimprovementexpendituresareParticipationbyOthersandinterestincome.ParticipationbyOthers,asshownonLine4includesanticipatedfundingbytheU.S.ArmyCorpsofEngineers(COE)andFEMA.Interestearningsrecognizeanassumed1.0percentaverageannualinterestrateandareshownonLine5.Line6ofthetableshowstheprojectedmajorcapitalimprovementfundsavailableeachyear.

AsofDecember31,2015,theBoardhad$23,993,300obligatedforopencontractsandcapitaljobsasshownonLine7ofTable11.Lines8and9showtheprojectedReinvestmentinAssetsandMajor


36 OCTOBER 2016

CapitalAdditionstobefundedasshowninTable7.EstimatedissuancecostsandcapitalizedinterestrelatedtotheproposedbondissueamountsareshownonLines10and11.

Line12showstherequireddepositsintotheRevenueBondReserveFundassociatedwithproposedbondissues.Thedebtservicereserveonproposeddebtisathree‐prongtestestimatedasthelessorof(i)10percentoftheoriginalprincipalamount,(ii)themaximumannualdebtservice,or(iii)125percentoftheaverageannualdebtservice.

TheTotalApplicationofFundsisshownonLine13ofTable11.ThenetEndofYearBalanceisshownonLine14.

Operating Fund

Line1ofTable12showsprojectedRevenuefromChargesunder2016ratesaspreviouslypresentedinTable8.In2012,theNewOrleansCityCouncilapprovedeightconsecutiveannual10percentwaterrateincreasesbeginningJanuary1,2013.Revenuefromthesefutureannualrevenueincreasesof10percenteffectiveJanuary1,2017throughJanuary1,2020isshownonLine2.

OtherrevenueavailableforsystemoperationsisshownonLines4through7.InterestIncomeavailabletotheoperatingfund,shownonLine4,isestimatedtobe1.0percentoftheaverageofthebeginningandendofyearNetAnnualBalance,exceptastheaverageisaffectedbyidentifiablenonrecurringmajorreceipts,transfers,orexpendituresduringtheyear.RevenuefromPlumbingInspectionandLicenseFeesandOtherMiscellaneousRevenueareshownonLines5and6ofTable12.

InterestfromtheBondReserveFund,shownonLine7,isestimatedtobe1.0percent.TotalOperatingRevenueisshownonLine8.

OperationandMaintenanceexpense,previouslyprojectedinTable9,isshownonLine9ofTable12.Line10showstheestimatedallowanceforclaims.Baddebtexpenseisassumedtobe2percentofprojectedrevenueandisshownonLine11.ProjectedNetOperatingRevenuefromsystemoperationsisshownonLine12.

Lines13through15presentdebtservicerequirementsoncurrentlyoutstandingandproposedseniorrevenuebonds.ExistingdebtincludestheSeries2014andSeries2015bonds.Line14reflectsprojectedprincipalandinterestpaymentsonadditionalrevenuebonddebtfinancingof$90,000,000in2017and$34,000,000.Proposeddebtisassumedtobe30year,5.5percentfixedinterestratebondsissuedinAugust,with1yearofcapitalizedinterestandequalannualpaymentsofprincipalandinterest.

InJulyof2006theBoardenteredintoaCooperativeEndeavorAgreementwiththeStateofLouisianatosecureproceedsfromtheState’sGulfOpportunityTaxCreditBondLoanProgramtoassistinpaymentofdebtservicerequirementsfrom2006through2008.TheBoardhasborrowed$77,465,247onthisagreement.Noprincipalorinterestwaspayableduringtheinitialfive‐yearperiodoftheloan,butafterthatperiod,theloanbegantobearaninterestrateof4.64percent.PaymentsforthewaterportionofprincipalandinterestbeganinJuly2012andareshownonLine16ofTable12assubordinatedebt.

Anticipatednon‐operatingrevenueisshownonLine18.



Line19reflectstheprojectedtransferofaccumulatednetearningsfromsystemoperationstoassistinmajorcapitalfinancing.Typically,suchaccumulatednetearningsmaybeusedtohelprecoverportionsoftheannualcostsofsystemoperationsortoassistinmajorcapitalimprovementfinancing.Line20reflectsrepaymenttotheDepartmentofPublicWorksandtheDrainageDepartmentaswellasclaimants.

TheGeneralResolutionrequiresanOperatingReserveFundof90daysofthepreviousyear’soperationandmaintenanceexpense;howevertheSWBNO’sFinancialManagementPolicyrequiresanOperatingReserveFundofnotlessthan180days.Line21indicatestheprojectedannualtransfersavailabletomeetthisrequirementthroughoutthestudyperiod.TheGeneralResolutionalsosetsforththeoptiontomaintainaratestabilizationfund.Theamounttobetransferredtothisfund,aswellasthetiming,isdeterminedbytheExecutiveDirector.TherearenotransferscurrentlyanticipatedduringthestudyperiodasshownonLine22ofTable12.

Line23indicatestheestimatedNetAnnualBalancefromoperationsremainingattheendofeachyear.

Thebalanceofoperatingfundsavailableatthebeginningoftheyear2016,shownonLine24,iscomprisedofthecurrentcashassetsandreflectsabalanceof$7,022,000.TheEndofYearBalance,whichisexclusiveoftheoperatingreservefundandratestabilizationfund,isshownonLine25.

Lines26through31demonstratethattheBoardismaintaininganoperatingreserveequaltoatleast180daysofthepreviousyear’soperationandmaintenanceexpensebeginningin2018.

AsdemonstratedinTables11and12,itisanticipatedthatcurrentrevenuesourceswillbeadequatetoreadilyfinancebothprojectedcapitalprogramrequirementsandestimatedfutureoperationexpensesoftheWaterDepartmentduringthe2016‐2020studyperiodexaminedherein.

Bond Coverage Requirements

Anadditionalconsiderationinmeasuringtheadequacyofrevenuesistheprovisionofsufficientdebtservicecoveragetomeetthebondcovenantrequirementsfortheissuanceofparityrevenuebonds.TheGeneralResolutionprovidesthatratesshallbemaintainedatlevelswhichareexpectedtoyieldnetrevenues(asdefinedintheresolution)equaltoatleast125percentoftheannualprincipalandinterestrequirementforseniordebtand110percentforseniorandsubordinatedebtineachfiscalyear.TheSWBNO’sFinancialManagementPolicyrequirescoverageataminimumof150percentforseniordebtand125percentforseniorandsubordinatedebt.

ThecalculationofnetrevenueisshownonLines1through8ofTable13.TheabilityoftheWaterDepartmentrevenuestomeetrevenuebondcoveragerequirementsisshownonLines9through13.AsshownonLines11and13,theindicatedprojectedrevenueandrevenueincreaseswillprovidesufficientnetrevenuetomeetcoveragerequirementsduringthestudyperiod.

TheGeneralResolutionfurtherprescribesthatadditionalparityrevenuebondsmaybeissuedifnetrevenuefromaprevioustestyear(any12consecutivemonthsofthelast24months)isequaltoatleast125percentofthemaximumannualprincipalandinterestrequirementforseniordebtand110percentforseniorandsubordinatedebt.Forpurposesoftheadditionalbondstest,netrevenuemaybeadjustedtoreflectanyincreasesnotineffectduringtheselectedtestyearbuthavebeenapproved


38 OCTOBER 2016

bytheBoard,BoardofLiquidationandCityCouncilandwillgointoeffectwithinthefollowingfiveyears.

TheresultsoftheadditionalbondstestareshownonLines14through20ofTable13.Lines18and20ofthetableindicatethatwiththemagnitudeoftheadoptedannualrevenueincreases,requiredminimumlevelsofcoveragearemetineachyearwithindicatedcoveragelevelsrangingfrom184percentto388percent.



Table 1 Insurance in Force as of December 31, 2015

Table 1

Insurance in Force as of December 31, 2015

ExpirationInsurer Coverage Amount of Coverage Date

$

Lexington Insurance Company

Vehicle Physical Damage Comprehensive Onlyincluding Flood $18,942,139 ($150,000 Deductible) 05/20/16

Zurich Commercial Crime $1,000,000 ($5,000 Deductible) 05/01/16

Swiss Re Westchester

Property - Building, Contents, Mobile Equipment, Boiler/Machinery/ Gross Earnings/Extra Expense

$100,000,000 Building and Contents $6,568,829 Mobile Equipment, $25,000,000 sublimit Boiler/Machinery, $9,000,000 Gross Earnings/Extra Expense ($1,000,000 Deductible) 05/20/2016

Genesis/RSUI Automobile LiabilityLimit: $6,000,000 ($350,000 Self-Insured Retention) 06/20/16

Travelers Fiduciary Liability $3,000,000 ($50,000 Deductible) 08/01/16

Wright Flood Flood 84 properties, see schedule 01/01/2016

ACE Mun. Adv.Public Officials/ Employees Liability Insurance $10,000,000 ($250,000 Deductible) 11/20/16


40 OCTOBER 2016

Table 2 Water Department – Historical and Projected Sales and Average Number of Customers

Table 2

Water DepartmentHistorical and Projected Sales andAverage Number of Customers (a)

Historical Projected (b)Customer Class 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020

Single Family Residential (c)Customers 102,979 105,537 109,836 111,421 113,167 114,900 116,500 117,900 119,200 120,400Sales (1,000,000 gal.) 6,592 6,461 6,475 6,421 6,527 6,627 6,652 6,668 6,681 6,690Sales Per Customer (1,000 gal.) 64 61 59 58 58 58 57 57 56 56

Multi-family ResidentialCustomers 4,439 4,467 4,549 4,533 4,562 4,600 4,600 4,600 4,600 4,600Sales (1,000,000 gal.) 788 767 731 686 691 697 690 684 678 672Sales Per Customer (1,000 gal.) 177 172 161 151 152 152 150 149 147 146

CommercialCustomers 9,918 9,969 10,193 10,328 10,400 10,500 10,500 10,500 10,500 10,500Sales (1,000,000 gal.) 3,683 3,694 3,681 3,656 3,667 3,702 3,665 3,630 3,597 3,567Sales Per Customer (1,000 gal.) 371 371 361 354 353 353 349 346 343 340

IndustrialCustomers 17 19 20 20 21 21 21 21 21 21Sales (1,000,000 gal.) 42 44 46 52 59 58 58 57 57 56Sales Per Customer (1,000 gal.) 2,407 2,343 2,324 2,620 2,777 2,776 2,748 2,724 2,700 2,676

Dual Service & Metered Fire Service (d)Customers 1,392 1,443 1,509 1,574 1,659 1,700 1,700 1,700 1,700 1,700Sales (1,000,000 gal.) 2,821 2,786 2,640 2,688 3,057 3,132 3,101 3,071 3,044 3,018Sales Per Customer (1,000 gal.) 2,027 1,931 1,750 1,708 1,842 1,842 1,824 1,807 1,790 1,775

TotalCustomers 118,745 121,435 126,106 127,876 129,809 131,721 133,321 134,721 136,021 137,221Sales (1,000,000 gal.) 13,925 13,752 13,573 13,504 14,000 14,217 14,166 14,110 14,056 14,002

-1.24% -1.30% -0.51% 3.68% 1.55% -0.36% -0.39% -0.39% -0.38%(a) Excludes customers receiving free service. 2.26% 3.85% 1.40% 1.51% 1.47% 1.21% 1.05% 0.96% 0.88%(b) Projections subject to revision in Black & Veatch's Financial Plan for Water, Sewerage, and Drainage Systems for 2017-2026 report.(c) Includes duplex. 0(d) Does not include flat rate fire protection customers.



Table 3 Water Department – Existing Water Rates Table 3

Water DepartmentExisting Water Rates

(Effective January 1, 2016)

General DualRate Components Service Service (a)

$ $Monthly Water Service Charge

Meter Size________Inches

5/8 5.94 8.063/4 7.26 9.811 9.22 12.89

1-1/2 15.22 20.062 20.06 28.703 45.39 63.694 79.06 111.286 155.20 216.698 229.87 322.1010 311.85 436.3012 366.03 512.4416 487.54 682.28

Monthly Water Quantity Charge - per 1,000 Gallons

First 3,000 gallons 3.95 3.95Next 17,000 gallons 6.74 6.74

Next 980,000 gallons 5.30 5.30 Over 1,000,000 gallons 4.44 4.44

Flat Rate Fire Service


2 13.463 18.304 33.676 58.568 77.5910 122.9812 159.5916 219.62

(a) Includes Dual Service and all metered fire services.


42 OCTOBER 2016

Table 4 Water Department – Statement of Historical Revenues Table 4

Water DepartmentStatement of Historical Revenue

Revenue Source 2011 2012 2013 2014 2015$ $ $ $ $

Operating RevenueSales of Water 58,804,719 59,208,198 63,248,555 69,601,809 76,719,113Delinquent Fee 1,085,593 1,048,107 1,150,054 1,216,445 1,288,824________ ________ ________ ________ ________ Total Operating Revenue 59,890,312 60,256,305 64,398,610 70,818,254 78,007,937

Nonoperating RevenueInterest Earned 44,752 92,849 82,893 349,607 966,017Plumbing Inspection and License Fees 379,036 343,903 321,518 339,176 305,384Revenue Sharing 140,655 123,885 219,877 254,577 258,721Other Income (a) 15,944,157 10,851,066 5,234,998 2,459,234 3,418,560________ ________ ________ ________ ________ Total Nonoperating Revenue 16,508,600 11,411,703 5,859,286 3,402,593 4,948,682________ ________ ________ ________ ________ Total Revenue 76,398,912 71,668,008 70,257,896 74,220,847 82,956,619

(a) Includes $11,514,936 in operating and maintenance grants in 2011, $7,617,063 in 2012, $1,981,568 in 2013, -$381,876 in 2014 and $2,405 in 2015.



Table 5 Water Department – Historical Operation and Maintenance Expenses Table 5

Water DepartmentHistorical Operation and Maintenance Expenses (a)

2011 2012 2013 2014 2015$ $ $ $ $

Personal Services 30,819,637 31,410,463 32,375,467 34,802,991 42,333,498Services & Utilities 13,199,077 12,230,597 15,964,882 16,936,254 17,408,686Supplies & Materials 17,947,200 17,109,745 14,229,820 14,998,094 18,276,404Special Current Charges 2,881,217 1,532,863 1,304,502 2,357,932 (103,530)Furniture & Equipment 221,278 173,656 233,244 298,973 349,610Repairs & Facility Maintenance 0 0 0 0 0________ ________ ________ ________ ________ Total Operation and Maintenance (b) 65,068,409 62,457,322 64,107,915 69,394,244 78,264,668

0 0 0 0 0(a)

(b) Source: Expenditure Analysis by Group Report.

Historical operation and maintenance expenses do not include the non-cash portion of provision for claims as recorded in the Comprehensive Annual Financial Report. Estimates of future Water Department claims payable are included in Table 11.


44 OCTOBER 2016

Table 6 Water Department – Capital Expenditures ‐ 2015 Table 6

Water DepartmentCapital Expenditures

2015

Actual C.P. # Project Expenditures

$Waterworks

110 Normal Extensions & Replacements 2,181,901112 Modification to Oak St Raw Water Intake Station 197,263122 Sycamore and Claiborne Filter Rehabilitation 912,946156 Advanced Water Treatment 129,613160 SELA Water Relocation Costs 2,103,237175 Water Hurricane Recovery Bonds 8,120,449180 FEMA Review of Change Orders - Water 5,170,319________

Total Waterworks 18,815,729

Water Distribution214 Normal Extensions & Replacements 1,505,838215 Rehabilitation - Mains, Hydrants & Services 264,850239 Mains DPW Contracts 2,878,095________

Total Water Distribution 4,648,784

Power Projects and General Budget600 Water Share of Power Projects 5,995,949700 Water Reserve for Emergencies 270,400800 Water Share of General Budget Items 8,833,951________

Total Power Projects and General Budget 15,100,301

Total Water Department 38,564,813



Table 7 Water Department – Proposed Capital Improvements Table 7

Water DepartmentProjected Capital Improvements (a)

C.P. # Project 2016 2017 2018 2019 2020 Total$ $ $ $ $ $

Reinvestment in Assets110 Normal Extension & Replacement 10,459,000 14,070,000 6,245,000 4,920,000 5,470,000 41,164,000112 Modification to Oak St. Raw Water Intake Station 1,200,000 5,500,000 5,000,000 11,700,000122 Sycamore and Claiborne Filter Rehabilitation 4,490,000 1,500,000 5,990,000160 SELA Water Relocation Costs 833,000 603,000 237,000 578,000 2,145,000 4,396,000214 Normal Extensions & Replacements 2,365,000 2,385,000 2,385,000 2,410,000 2,410,000 11,955,000216 Water System Replacement Program 5,100,000 5,100,000 5,200,000 5,000,000 5,000,000 25,400,000239 Mains In Streets Department Contracts 3,200,000 3,200,000 3,200,000 3,200,000 3,200,000 16,000,000600 Water Share of Power Projects 16,852,000 12,369,000 5,572,000 280,000 630,000 35,703,000701 Water Reserve for Emergencies 2,000,000 2,000,000 2,000,000 2,000,000 2,000,000 10,000,000800 Water Share of General Budget Items 23,502,000 19,871,000 9,321,000 8,066,000 8,519,000 69,279,000________ ________ ________ ________ ________ _________

Total Routine Capital Improvements 70,001,000 66,598,000 39,160,000 26,454,000 29,374,000 231,587,000

Major Capital Improvements135 Improvements to Chemical System 370,000 1,400,000 3,000,000 4,770,000156 Advanced Carrollton Water Treatment 6,815,000 200,000 20,120,000 120,000 120,000 27,375,000157 Advanced Algiers Water Treatment 1,940,000 3,575,000 2,750,000 8,265,000158 Water Treatment Carr. 200,000 200,000 400,000159 Water Plant Security Improvements 2,000,000 2,000,000 4,000,000175 Water Hurricane Recovery Bonds 69,717,000 20,000,000 20,000,000 20,000,000 20,000,000 149,717,000221 Feeder Main Extension, General 100,000 100,000 50,000 50,000 50,000 350,000________ ________ ________ ________ ________ _________

Total Major Capital Improvements 81,142,000 25,475,000 47,920,000 20,170,000 20,170,000 194,877,000________ ________ ________ ________ ________ _________ Total Water Department Improvements 151,143,000 92,073,000 87,080,000 46,624,000 49,544,000 426,464,000

(a) The improvements for 2016-2020 are based on the 2016 capital budget and 2016-2025 capital program.


46 OCTOBER 2016

Table 8 Water Department – Projected Operating Revenues Table 8

Water DepartmentProjected Operating Revenue

(1) (2) (3)

TotalRevenue Service

From Additional Charge Year Charges Revenue (a) Revenue

$ $ $

2016 86,140,300 0 86,140,300

2017 86,002,900 8,463,400 94,466,300

2018 85,826,700 17,741,900 103,568,600

2019 85,648,700 27,973,900 113,622,600

2020 85,465,200 39,180,200 124,645,400

(a) Reflects additional revenue from adopted revenue increases.



Table 9 Water Department – Projected Operation and Maintenance Expense Table 9

Water DepartmentProjected Operation and Maintenance Expenses

2016 2017 2018 2019 2020$ $ $ $ $

Personal Services 38,103,500 39,246,600 40,424,000 41,636,700 42,885,800Services & Utilities 17,930,900 18,468,900 19,022,900 19,593,600 20,181,400Supplies & Materials 18,824,700 19,389,400 19,971,100 20,570,300 21,187,400Special Current Charges 1,577,600 1,625,000 1,673,700 1,723,900 1,775,600Furniture & Equipment 360,100 370,900 382,000 393,500 405,300Repairs & Facility Maintenance 0 0 0 0 0________ ________ ________ ________ ________ Total Operation and Maintenance 76,796,800 79,100,800 81,473,700 83,918,000 86,435,500


48 OCTOBER 2016

Table 10 Water Department – Debt Service Requirements Table 10

Water DepartmentDebt Service Requirements

2016 2017 2018 2019 2020$ $ $ $ $

Existing BondsSeries 2014 5,501,300 7,700,000 7,693,000 7,700,000 7,690,000Series 2015 4,721,000 4,940,600 5,640,600 5,694,600 5,783,600_________ _________ _________ _________ _________ Total Existing Debt Service 10,222,300 12,640,600 13,333,600 13,394,600 13,473,600

Projected BondsAmountof Issue________

$2016 0 0 0 0 0 02017 90,000,000 0 2,722,125 6,533,100 6,533,1002018 0 0 0 02019 34,000,000 0 1,028,3332020 0 0_________ _________ _________ _________ _________ Total Projected Debt Service 0 0 2,722,125 6,533,100 7,561,433_________ _________ _________ _________ _________ Total Debt Service 10,222,300 12,640,600 16,055,725 19,927,700 21,035,033



Table 11 Water Department – Capital Improvement Program Financing Table 11

Water DepartmentCapital Improvement Program Financing

Line Fiscal Year Endiing December 31, No. Description 2016 2017 2018 2019 2020 Total

$ $ $ $ $ $

1 Funds Available at Beginning of Year 143,667,000 55,737,600 71,202,200 11,177,400 22,562,500 143,667,0002 Revenue Bond Proceeds 0 90,000,000 0 34,000,000 0 124,000,0003 Operation Fund Transfers 0 0 4,000,000 10,000,000 16,500,000 30,500,0004 Participation By Others 86,058,000 32,461,500 27,866,700 22,985,500 23,675,100 193,046,8005 Interest Income 1,148,900 671,400 491,600 194,900 196,100 2,702,900_________ _________ _________ _________ _________ _________6 Total Funds Available 230,873,900 178,870,500 103,560,500 78,357,800 62,933,700 493,916,700

7 Obligated Contracts & Capital Jobs (23,993,300) 0 0 0 0 (23,993,300)8 Reinvestment in Assets (70,001,000) (68,595,900) (41,544,800) (28,907,000) (33,060,700) (242,109,400)9 Major Capital Additions (81,142,000) (26,239,300) (50,838,300) (22,040,300) (22,701,500) (202,961,400)10 Bond Issuance Expense 0 (1,350,000) 0 (510,000) 0 (1,860,000)11 Capitalized Interest Requirement 0 (4,950,000) 0 (1,870,000) 0 (6,820,000)12 Revenue Bond Reserve Fund 0 (6,533,100) 0 (2,468,000) 0 (9,001,100)_________ _________ _________ _________ _________ _________13 Total Application of Funds (175,136,300) (107,668,300) (92,383,100) (55,795,300) (55,762,200) (486,745,200)

14 End of Year Balance 55,737,600 71,202,200 11,177,400 22,562,500 7,171,500 7,171,500


50 OCTOBER 2016

Table 12 Water Department – Analysis of Ability of Forecasted Revenues to Finance Projected Revenue Requirements Table 12

Water DepartmentAnalysis of Ability of Forecasted Revenue toFinance Projected Revenue Requirements

Line Fiscal Year Endiing December 31, No. Description 2016 2017 2018 2019 2020

$ $ $ $ $

1 Revenue from Charges 86,140,300 86,002,900 85,826,700 85,648,700 85,465,2002 Total Additional Revenue (a) 0 8,463,400 17,741,900 27,973,900 39,180,200_________ _________ _________ _________ _________ 3 Total Service Charge Revenue 86,140,300 94,466,300 103,568,600 113,622,600 124,645,4004 Interest Income 341,500 348,300 379,100 395,700 404,2005 Plumbing Insp. & License Fees 299,700 299,700 299,700 299,700 299,7006 Other Miscellaneous Income 3,155,100 3,155,100 3,155,100 3,155,100 3,155,1007 Interest from Bond Reserve Fund 164,000 197,000 230,000 242,000 254,000_________ _________ _________ _________ _________ 8 Total Operating Revenue 90,100,600 98,466,400 107,632,500 117,715,100 128,758,400

9 Operation & Maintenance (76,796,800) (79,100,800) (81,473,700) (83,918,000) (86,435,500)10 Provision for Claims (943,800) (943,800) (943,800) (943,800) (943,800)11 Provision for Doubtful Accounts (1,722,800) (1,720,100) (1,716,500) (1,713,000) (1,709,300)_________ _________ _________ _________ _________ 12 Net Operating Revenue 10,637,200 16,701,700 23,498,500 31,140,300 39,669,800

Debt ServiceSenior Lien Revenue Bonds

13 Existing (10,222,300) (12,640,600) (13,333,600) (13,394,600) (13,473,600)14 Projected 0 0 (2,722,100) (6,533,100) (7,561,400)_________ _________ _________ _________ _________ 15 Total Senior Lien Revenue Bonds (10,222,300) (12,640,600) (16,055,700) (19,927,700) (21,035,000)

Subordinate Revenue Bonds16 Gulf Opportunity Zone Act Loan (639,900) (639,900) (639,900) (639,900) (639,900)_________ _________ _________ _________ _________ 17 Total Debt Service (10,862,200) (13,280,500) (16,695,600) (20,567,600) (21,674,900)

18 Other Non-Operating Revenue 400,500 400,500 400,500 400,500 400,50019 Transfer to Construction 0 0 (4,000,000) (10,000,000) (16,500,000)20 Due from/(to) Other Departments (2,186,000) (436,000) (436,000) 0 021 Transfer to Operating Reserve Fund 0 0 (206,200) (585,100) (602,700)22 Transfer from/(to) Rate Stabilization Fund 0 0 0 0 023 Net Annual Balance (2,010,500) 3,385,700 2,561,200 388,100 1,292,700

24 Beginning of Year Cash Balance (b) 7,022,000 5,011,500 8,397,200 10,958,400 11,346,500

25 End of Year Balance 5,011,500 8,397,200 10,958,400 11,346,500 12,639,200

26 Beginning of Year Cash Balance (b) 7,022,000 35,488,345 38,874,045 41,641,445 42,614,64527 Customer Deposits 11,178,70028 Operating Reserve Fund 19,298,145 0 206,200 585,100 602,70029 Net annual Balance (2,010,500) 3,385,700 2,561,200 388,100 1,292,70030 End of Year Balance 35,488,345 38,874,045 41,641,445 42,614,645 44,510,04531 Days of O&M Cash on Hand 163 174 181 180 182

(a)

(b) Reflects beginning of year balance in unrestricted and undesignated cash and cash equivalents and cash and cash equivalents designated for capital projects, less operating reserve requirement.

Reflects revenue from an eight-year series of annual 10% rate increases effective January 1, 2013; adopted by the City Council in 2012.



Table 13 Water Department – Coverage Requirements Table 13

Water DepartmentCoverage Requirements

LineNo. Coverage Requirements 2016 2017 2018 2019 2020

$ $ $ $ $

Projected Net Revenues1 Revenue Under Existing Rates 86,140,300 86,002,900 85,826,700 85,648,700 85,465,2002 Additional Revenue Under Proposed Rate 0 8,463,400 17,741,900 27,973,900 39,180,2003 Interest Income 1,654,400 1,216,700 1,100,700 832,600 854,3004 Plumbing and Inspection Fees 299,700 299,700 299,700 299,700 299,7005 Other Miscellaneous Revenue 3,155,100 3,155,100 3,155,100 3,155,100 3,155,1006 Transfer from Rate Stabilization Fund 0 0 0 0 07 Operation & Maintenance (76,796,800) (79,100,800) (81,473,700) (83,918,000) (86,435,500)_________ _________ _________ _________ _________8 Net Revenue 14,452,700 20,037,000 26,650,400 33,992,000 42,519,000

Rate Covenant Coverage9 Projected Net Revenues 14,452,700 20,037,000 26,650,400 33,992,000 42,519,000

Annual Debt Service10 Senior Debt 10,222,300 12,640,600 16,055,700 19,927,700 21,035,00011 Coverage (a) 141% 159% 166% 171% 202%12 All Debt 10,862,200 13,280,500 16,695,600 20,567,600 21,674,90013 Coverage (b) 133% 151% 160% 165% 196%

Additional Bond Coverage14 Preceding Year Projected Net Revenues 4,691,900 14,452,700 20,037,000 26,650,400 33,992,00015 Future Additional Revenue (c) 47,624,600 39,977,700 28,467,000 18,023,600 8,564,900_________ _________ _________ _________ _________16 Adjusted Projected Net Revenues 52,316,500 54,430,400 48,504,000 44,674,000 42,556,900

Maximum Debt Service17 Senior Debt 13,473,600 20,006,700 20,006,700 22,474,600 22,474,60018 Coverage (a) 388% 272% 242% 199% 189%19 All Debt 14,113,500 20,646,600 20,646,600 23,112,300 23,112,30020 Coverage (b) 371% 264% 235% 193% 184%

(a) The General Bond Resolution requires net revenue to equal or exceed 125% of debt service.(b) The General Bond Resolution requires net revenue to equal or exceed 110% of debt service.(c) Reflects revenue from an eight-year series of annual 10% rate increases effective January 1, 2013; adopted

by the City Council in 2012.


52 OCTOBER 2016

Sewerage Department

ADHERENCE TO SEWERAGE SERVICE REVENUE BOND RESOLUTION In2014,theBoardissued$158,990,000SewerageServiceRevenueandRefundingBonds.IssuanceofthesebondsobligatedtheBoardtoadheretothecovenantsoftheBondResolution.Briefly,thecovenantsareconcernedwith:

Paymentofindebtedness;limitedobligations. Limitationsonindebtedness. CovenantsandrepresentationsofBoard. Covenantswithcreditbanks,insurers,etc. Operationandmaintenance. Freeservice,competingservice,billingandenforcementofcharges. Saleorencumbranceofsystem. Insurance Damage,destruction,condemnationandlossoftitle. Recordsandaccounts;inspectionsandreports. Capitalbudget.

TheprovisionsoftheGeneralSewerageServiceRevenueBondResolutionarevirtuallyidenticaltothoseoftheGeneralWaterRevenueBondResolutiondescribedintheprecedingsectionofthisreport.TheBoardwasincompliancewiththesecovenantsin2015.SewerageDepartmenttablesareincludedattheendofthissection.

2015 SEWERAGE DEPARTMENT OPERATIONS Fundsfortheoperation,maintenance,anddebtservicerequirementsoftheSewerageDepartmentareobtainedfromsewerageservicecharges.Thebalanceofrevenueremainingaftermeetingthesecostsmaybeusedforcashfinancingcapitalimprovementsasrequired.Otherfundsourcesincludeparticipationbyothers,interestearnedoninvestedfunds,andotherminorsources.

Revenuesandexpendituresrelatedtothe2015operationsoftheSewerageDepartmentarediscussedinthefollowingparagraphs.

Wastewater Volumes

Number of Customers

Table14presentsasummaryofthehistoricalandprojectedaveragenumberofsewercustomersfortheperiod2011through2020.Basedonyear‐endbillingsummaries,thenumberofmonthlybilledcustomersduring2015averaged127,105comparedwith125,303for2014.ItisprojectedthattheBoardwillaverageapproximately128,931openaccountsin2016andthatthenumberofaccountswillcontinuetogrowatapproximately0.9percenteachyear.

Billed Wastewater Volume

Table14alsopresentsasummaryofhistoricalandprojectedbilledwastewatervolumes.Basedonyear‐endbillingsummaries,atotalof11,597milliongallonsofwastewatervolumewasbilledin2015,comparedwithatotalof11,223milliongallonsin2014.Since85percentofresidentialwater


BLACK & VEATCH | Sewerage Department 53

usageand100percentofnon‐residentialusageistreatedasbillablesewerflows,thedecreaseinsewagevolumebilledissimilartothedecreaseinwaterusage.Afterfactoringinthenumberofannualbillsrendered,theaverageannualusagepercustomerforeachcustomerclassandtheprojectedresistancefactor,theresultingprojectedcontributedwastewatervolumereflectsadecreaseofapproximately0.4percentperyear.

Operating Revenues

The2016scheduleofratesforretailsewerageserviceispresentedinTable15andreflectsa10percentrateincreaseover2015rates.Theratesconsistofmonthlyservicecharges,whichvarybymetersize,plusavolumecharge.Quantitychargesforsinglefamilyresidentialandmulti‐residentialcustomersarebasedon85percentofthemeteredwaterconsumptiontoallow15percentforlawnwateringandotheruses,whichcontributenoflowtothesanitarysewer.Allotherclassesarebasedon100percentofwaterconsumption.Waterfromprivatewellsorothernon‐Boardsourcesthatisdischargedtothesanitarysewersystemistobemeteredandtheconsumptionincludedincomputingsewerageservicecharges.Anycustomerwhocanshowthatonlyaportionofhismeteredwaterusageisdischargedtothesanitarysewersystemistobechargedforonlythatportionofthetotalwaterquantity.Aresidentialcustomermayhaveeitherthe15percentallowanceoraspecialexemption,butnotboth.

AsummaryofhistoricalsewerbillingsandotherSewerageDepartmentrevenueispresentedinTable16fortheperiod2011through2015.ThehistoricalrevenuesshowninTable16weredevelopedfromdetailedrecordsprovidedbyBoardstaff.Operatingrevenuesarederivedfromsewerageservicechargerevenue,whichincludesexcessstrengthcharges,anddelinquentfees.Sewerageservicechargerevenuesin2015were$94,775,797which,whencomparedwith$85,740,367for2014,showsanincreaseofapproximately10.5percent.Delinquentfeerevenueswere$861,169in2015whichrepresentanincreaseofapproximately5.9percentover2014delinquentfees.

Non‐Operating Revenues

AlsoshowninTable16,SewerageDepartmentnon‐operatingrevenueincludesinterestearnedontheinvestmentofavailablefundsandotherminoritemsofrevenue.Interestearnedin2015consistedof$1,340,586frominvestmentsintheSewerageSystemfund,thecapitalprojectsandconstructionfund.Miscellaneousincomewas$1,188,215for2015.


Table17presentsasummaryof2011through2015historicaloperationandmaintenanceexpensesoftheSewerageDepartment.Expendituresfor2015increasedabout19.5percentfrom2014expendituresandabout25.5percentfrom2013expenditures.HistoricaloperationandmaintenanceexpensesshowninTable17donotincludethenon‐cashportionofProvisionforClaimsasrecordedintheComprehensiveAnnualFinancialReport.EstimatesoffutureSewerageDepartmentclaimsareshownonLine12inTable24.


CapitalexpendituresoftheSewerageDepartmentincludethecostofreplacementsandimprovementstowastewatertreatmentandcollectionfacilitiesandtheSewerageDepartmentproratashareofpowerprojectsandgeneralbudgetcosts.


54 OCTOBER 2016

TheSewerageDepartment’s2015capitalexpenditurestotaled$46,929,082.CapitalimprovementexpendituresfortheyearareshowninTable18.


ThefollowingtabulationshowsasummaryofthereceiptsandexpendituresoftheSewerageDepartmentduring2015:



Claims 392,928


Revenue Primarily Available for Capital Expenditures a 20,748,937a Excludes depreciation.

PROPOSED CAPITAL IMPROVEMENT PROGRAM Table19presentsasummaryoftheprojectedmajorcapitalimprovementprogramfortheperiod2016through2020.Table19isbasedontheBoard’s2016‐2025CapitalProgram.Thefive‐yearmajorcapitalimprovementprogramcostsareestimatedtototal$439,339,000.Oftheprojectedtotal,$344,679,000isconsideredtobeforrecurringannualcapitalimprovements.Theremaining$94,660,000isforproposedmajorcapitalexpenditures.CostsofpowerprojectsandgeneralbudgetitemsareproratedbetweentheWater,SewerageandDrainageDepartmentsonthebasisofrelativeuse.TheprojectedSewerageDepartmentproratashareofpowerprojectsandgeneralbudgetitemcostsforthefive‐yearperiod2016through2020total$21,748,000and$44,545,000,respectively.

TheBoardiscurrentlycomplyingwiththeEPARegion6AdministrativeOrder.InJanuaryof2010,theBoardsuccessfullycompletednegotiationsforamodificationoftheConsentDecree.TheCapitalImprovementProgramshowninTable19representsthescheduleforcomplyingwiththemodifiedConsentDecree.

ABILITY TO FINANCE PROPOSED CAPITAL EXPENDITURES ThissectionofthereportanalyzestheadequacyofprojectedrevenuestofinancetheproposedcapitalimprovementsshowninTable19.

Operating Revenues

FutureoperatingrevenuesoftheSewerageDepartmentconsistofsewerageservicechargerevenueswhicharesummarizedfor2016through2020inTable20.TheseestimatesreflecttheratescheduleeffectiveJanuary1,2016appliedtotheprojectednumberofcustomersandcontributedwastewaterflow.ProjectedrevenuefromadoptedrevenueincreasesisalsoshowninTable20.

Other Revenue Sources

Baseduponpastpractices,theSewerageDepartmentcanexpecttoobtainrevenuesorfundsfromnon‐operatingsources.Theseincludeinterestearnedfromtheinvestmentofavailablefunds,participationbyothers,andmiscellaneousotherincome.ByBoardpolicy,theSewerageDepartmentreceivesone‐halfoftheplumbinginspectionandlicensefees,currentlyprojectedat$326,100peryear.



Interestincomefromtheinvestmentoffundsheldforfutureusedependsuponthelevelofseweragerevenueavailableforinvestmentandtheamountofrevenueaccruedtowardspaymentoffuturecapitalexpenditures.

Projectionsofotherrevenuesourcesarepresentedinasubsequenttable,whichsummarizestheDepartment’sfinancialpositionduringthefinancingofprojectedoperatingandcapitalrequirements.

Operation and Maintenance Expense

Asummaryofprojectedoperationandmaintenanceexpensefortheperiod2016through2020isshowninTable21.Estimatesoffutureexpensesarebasedonanticipatedfutureoperatingconditionsandallowancesforinflationaryfactors.

Projectionsoffutureoperatingandmaintenanceexpensesforthestudyperiodarebasedon2015actualexpensesprovidedbytheSWBNOandananalysisofthecurrentandanticipatedoperatingconditionsandtrends.


FuturedebtservicerequirementsoftheSewerageDepartmentaremadeupofprincipal,interest,andreservefundpaymentsforcurrentlyoutstandingandfutureseweragerevenuebondissues.AsofDecember31,2015outstandingdebtobligationsconsistedof$7,755,000SewerageRevenueBondsSeries2011,$147,765,000SewerageServiceRevenueandRefundingBondsSeries2014,and$100,000,000SewerageServiceRevenueandRefundingBondsSeries2015.

InNovember2011,theBoardandLouisianaDepartmentofEnvironmentalQuality(LADEQ)enteredintoaloanagreementwhereby$9,000,000ofproceedsfromtheRevolvingLoanFundwereborrowedthroughtheissuanceofSewerageServiceSubordinateRevenueBonds,Series2011.Debtservicepaymentsassumea20‐yeartermwitha0.45percentinterestrateplusanadministrativefeeof0.5percent.TheBoardbegandrawingdownthefundsduringthefirstquarterof2012andasofDecember31,2015,hadreceivedatotalof$9,000,000indisbursements.TheBoardbeganmakingprincipalpaymentinNovember2013.WiththeissuanceoftheSeries2014bonds,theSeries2011bondsbecameparitydebtandentitledtotheprovisionsoftheGeneralSewerageServiceRevenueBondResolution.TotaloutstandingdebtobligationontheSewerageRevenueBondsSeries2011was$7,755,000asofDecember31,2015.

Toadequatelyfundtheproposedcapitalimprovements,additionalrevenuebondsareindicatedasshowninTable22.ItisanticipatedthattheBoardwillissuerevenuebondsintheamountof$130,000,000in2017and$32,000,000in2019.ProjectedbondsshowninTable22for2016through2020areassumedtobesoldatanaverageannualinterestrateof5.5percentforatermof30years.

TheSewerageDepartmenthasborrowedfromtheCityofNewOrleansDepartmentofPublicWorks(DPW).Itisanticipatedthatthisamountwillbereimbursedduringthestudyperiod.


TotalrevenuerequirementsfortheSewerDepartmentrecognizedforpurposesofthisreportincludeoperationandmaintenanceexpense,allowanceforclaims,debtservicecostsonmajorcapitalimprovementsfinancedthroughthesaleofbonds,andexpendituresforcapitalimprovementsnotfinancedfrombondproceeds.Table23examinesthefinancingofthemajorcapitalimprovement


56 OCTOBER 2016

programandTable24summarizesthefinancingofoperationandmaintenanceexpense,debtservicecostsonoutstandingandproposedbonds,andthetransferofoperatingfundsforcapitalimprovementfinancing.


Table23presentsthemajorcapitalimprovementfinancingplanwhichsummarizestheprojectedsourceandapplicationoffundsoverthesix‐yearstudyperiod.TheamountofFundsAvailableatBeginningofYear,shownonLine1,is$133,675,100.ThisamountisbasedonauditeddataprovidedbytheBoard.

Projectedrevenuebondproceeds,totaling$162,000,000,areshownonLine2.Theamountsandyearsofissuearedevelopedbyconsideringcapitalprogramneeds,currentpolicies,othersourcesofmajorcapitalimprovementfinancing,andthedebtservicecoveragerequirementsofthebondcovenantsregardingtheissuanceofparityrevenuebonds.

Financingofthemajorcapitalimprovementprogramanticipatesthetransferofatotalof$156,000,000ofoperatingreservesasshownonLine3.OthersourcesoffundsavailabletomeetmajorcapitalimprovementexpendituresareParticipationbyOthersandinterestincome.ParticipationbyOthers,asshownonLine4includesanticipatedfundingbytheCOEandFEMA.Interestearningsrecognizeanassumed1.0percentaverageannualinterestrateandareshownonLine5.Line6ofthetableshowstheprojectedmajorcapitalimprovementfundsavailableeachyear.

AsofDecember31,2015,theBoardhad$35,615,100obligatedforopencontractsandcapitaljobsasshownonLine7ofTable23.Lines8and9showtheprojectedReinvestmentinAssetsandMajorCapitalAdditionstobefundedasshowninTable19.EstimatedissuancecostsrelatedtotheproposedbondissueamountsareshownonLine10.

Line11showstherequireddepositsintotheRevenueBondReserveFundassociatedwithproposedbondissues.Thedebtservicereserveonproposeddebtisathree‐prongedtestestimatedasthelessorof(i)10percentoftheoriginalprincipalamount,(ii)themaximumannualdebtservice,or(iii)125percentoftheaverageannualdebtservice.


Operating Fund

Line1ofTable24showsprojectedRevenuefromChargesunder2016ratesaspreviouslypresentedinTable20.In2012,theNewOrleansCityCouncilapprovedeightconsecutiveannual10percentsewerrateincreasesbeginningJanuary1,2013.Revenuefromthesefutureannualrevenueincreasesof10percenteffectiveJanuary1,2016throughJanuary1,2020isshownonLine2.

OtherrevenueavailableforsystemoperationsisshownonLines4through7.InterestIncomeavailabletotheoperatingfund,shownonLine4,isestimatedtobe1.0percentoftheaverageofthebeginningandendofyearNetAnnualBalance,exceptastheaverageisaffectedbyidentifiablenonrecurringmajorreceipts,transfers,orexpendituresduringtheyear.RevenuefromPlumbingInspectionandLicenseFeesandOtherMiscellaneous



InterestfromtheBondReserveFund,shownonLine7,isestimatedtobe1.0percent.TotalOperatingRevenueisshownonLine8.

OperationandMaintenanceexpense,previouslyprojectedinTable21,isshownonLine9ofTable24.Line10showstheestimatedallowanceforclaims.Baddebtexpenseisassumedtobe2percentofprojectedrevenueandisshownonLine11.ProjectedNetOperatingRevenuefromsystemoperationsisshownonLine12.

Lines13through15presentdebtservicerequirementsoncurrentlyoutstandingandproposedseniorrevenuebonds.ExistingbondsincludetheSeries2011,Series2014andSeries2015bonds.Line16reflectsprojectedprincipalandinterestpaymentsonadditionalrevenuebonddebtfinancingof$130,000,000in2017and$32,000,000in2019.Proposeddebtisassumedtobe30year,5.5percentfixedinterestratebondsissuedinAugust.

InJulyof2006,theBoardenteredintoaCooperativeEndeavorAgreementwiththeStateofLouisianatosecureproceedsfromtheState’sGulfOpportunityTaxCreditBondLoanProgramtoassistinpaymentofdebtservicerequirementsfrom2006through2008.TheBoardhasborrowed$77,465,247onthisagreement.Noprincipalorinterestwaspayableduringtheinitialfive‐yearperiodoftheloan,butafterthatperiod,theloanbegantobearaninterestrateof4.64percent.PaymentsforthesewerageportionofprincipalandinterestbeganinJuly2012andareshownonLine16ofTable24assubordinatedebt.

Anticipatednon‐operatingrevenueisshownonLine18.

Line19reflectstheprojectedtransferofaccumulatednetearningsfromsystemoperationstoassistinmajorcapitalfinancing.Typically,suchaccumulatednetearningsmaybeusedtohelprecoverportionsoftheannualcostsofsystemoperationsortoassistinmajorcapitalimprovementfinancing.Line20reflectspaymenttotheDepartmentofPublicWorksaswellasclaimants.

TheGeneralResolutionrequiresanOperatingReserveFundof90daysofthepreviousyear’soperationandmaintenanceexpense;howevertheSWBNO’sFinancialManagementPolicyrequiresanOperatingReserveFundofnotlessthan180days.Line21indicatestheprojectedannualtransfersavailabletomeetthisrequirementthroughoutthestudyperiod.TheGeneralResolutionalsosetsforththeoptiontomaintainaratestabilizationfund.Theamounttobetransferredtothisfund,aswellasthetiming,isdeterminedbytheExecutiveDirector.TherearenotransferscurrentlyanticipatedduringthestudyperiodasshownonLine22ofTable24.

Line23indicatestheestimatedNetAnnualBalancefromoperationsremainingattheendofeachyear.

Thebalanceofoperatingfundsavailableatthebeginningofyear2016,shownonLine24,iscomprisedofthecurrentcashassetsandreflectsabalanceof$24,722,800.TheEndofYearBalanceisshownonLine25.

Lines26through30demonstratethattheBoardismaintaininganoperatingreserveequaltoatleast180daysofthepreviousyear’soperationandmaintenanceexpense.


58 OCTOBER 2016

AsdemonstratedinTables23and24,itisanticipatedthatcurrentrevenuesourceswillbeadequatetoreadilyfinancebothprojectedcapitalprogramrequirementsascurrentlyscheduledandestimatedfutureoperationexpensesoftheSewerageDepartmentduringthe2016‐2020studyperiodexaminedherein.


Anadditionalconsiderationinmeasuringtheadequacyofrevenuesistheprovisionofsufficientdebtservicecoveragetomeetthebondcovenantrequirementsfortheissuanceofparityrevenuebonds.TheGeneralResolutionprovidesthatratesshallbemaintainedatlevelswhichareexpectedtoyieldnetrevenues(asdefinedintheresolution)equaltoatleast125percentoftheannualprincipalandinterestrequirementforseniordebtand110percentforseniorandsubordinatedebtineachfiscalyear.TheSWBNO’sFinancialManagementPolicyrequirescoverageataminimumof150percentforseniordebtand125percentforseniorandsubordinatedebt.

ThecalculationofnetrevenueisshownonLines1through8ofTable25.TheabilityoftheSewerageDepartmentrevenuestomeetrevenuebondcoveragerequirementsisshownonLines9through13.AsshownonLines11and13,theindicatedprojectedrevenueandrevenueincreaseswillprovidesufficientnetrevenuetomeetcoveragerequirementsduringthestudyperiod.

TheGeneralResolutionfurtherprescribesthatadditionalparityrevenuebondsmaybeissuedifnetrevenuefromaprevioustestyear(any12consecutivemonthsofthelast24months)isequaltoatleast125percentofthemaximumannualprincipalandinterestrequirementforseniordebtand110percentforseniorandsubordinatedebt.Forpurposesoftheadditionalbondstest,netrevenuemaybeadjustedtoreflectanyincreasesnotineffectduringtheselectedtestyearbuthavebeenapprovedbytheBoard,BoardofLiquidationandCityCouncilandwillgointoeffectwithinthefollowingfiveyears.

TheresultsoftheadditionalbondstestareshownonLines14through20ofTable25.Lines18and20ofthetableindicatethatwiththemagnitudeoftheadoptedannualrevenueincreases,requiredminimumlevelsofcoveragearemetineachyearwithindicatedcoveragelevelsrangingfrom261percentto397percent.



Table 14 Sewerage Department – Historical and Projected Billed Volumes and Average Number of Customers Table 14

Sewerage DepartmentHistorical and Projected Billed Volumesand Average Number of Customers (a)

Historical Projected (b)Customer Class 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020

Single Family Residential (c)Customers 102,265 104,782 109,036 110,599 112,318 114,000 115,500 116,900 118,200 119,400Sales (1,000,000 gal.) 5,433 5,374 5,392 5,323 5,434 5,515 5,532 5,546 5,557 5,565Sales Per Customer (1,000 gal.) 53 51 49 48 48 48 48 47 47 47

Multifamily ResidentialCustomers 4,429 4,455 4,534 4,514 4,540 4,600 4,600 4,600 4,600 4,600Sales (1,000,000 gal.) 672 655 621 587 589 597 591 585 580 575Sales Per Customer (1,000 gal.) 152 147 137 130 130 130 128 127 126 125

CommercialCustomers 9,861 9,897 10,101 10,161 10,215 10,300 10,300 10,300 10,300 10,300Sales (1,000,000 gal.) 5,292 5,312 5,258 5,265 5,516 5,562 5,506 5,454 5,404 5,358Sales Per Customer (1,000 gal.) 536 536 520 518 539 539 534 529 524 520

IndustrialCustomers 27 28 30 29 31 31 31 31 31 31Sales (1,000,000 gal.) 57 51 47 48 59 59 58 57 57 56Sales Per Customer (1,000 gal.) 2,123 1,828 1,559 1,644 1,886 1,887 1,868 1,848 1,832 1,816

TotalCustomers 116,581 119,162 123,701 125,303 127,105 128,931 130,431 131,831 133,131 134,331Sales (1,000,000 gal.) 11,454 11,391 11,317 11,223 11,597 11,732 11,687 11,642 11,598 11,554

(a) Excludes customers receiving free service. 1.4% 1.2% 1.1% 1.0% 0.9%(b) Projections subject to revision in Black & Veatch's Financial Plan for Water, Sewerage, and Drainage Systems for 2017-2026 report.(c) Includes duplex. 1.2% -0.4% -0.4% -0.4% -0.4%


60 OCTOBER 2016

Table 15 Sewerage Department – Existing Sewer Rates Table 15

Sewerage DepartmentExisting Sewer Rates

(Effective January 1, 2016)

GeneralRate Components Service

$

Monthly Sewerage Service Charge


5/8 16.98 3/4 24.17

1 34.41 1-1/2 63.33

2 92.61 3 219.62 4 366.03 6 732.05 8 1,098.08 10 1,464.10 12 1,683.72 16 2,269.36

Monthly Quantity ChargePer 1,000 Gallons 5.91

Excessive Strength Charge per PoundBOD 0.39SS 0.23



Table 16 Sewerage Department – Statement of Historical Revenues Table 16

Sewerage DepartmentStatement of Historical Revenue

Revenue Source 2011 2012 2013 2014 2015$ $ $ $ $

Operating RevenueSewerage Service Charges 69,632,459 70,707,230 77,767,114 85,740,367 94,775,797Delinquent Fee 725,617 700,605 768,670 812,895 861,169_________ _________ _________ _________ _________ Total Operating Revenue 70,358,076 71,407,835 78,535,785 86,553,262 95,636,965

Nonoperating RevenueInterest Income 253,547 194,080 178,122 257,824 1,340,586Plumbing Inspection and License Fees 379,036 343,903 321,518 339,176 305,384Revenue Sharing 175,424 154,509 274,229 317,506 322,674Other Income (a) 3,009,211 296,406 771,397 1,289,474 560,157_________ _________ _________ _________ _________ Total Nonoperating Revenue 3,817,218 988,898 1,545,265 2,203,980 2,528,801_________ _________ _________ _________ _________ Total Revenue 74,175,294 72,396,734 80,081,050 88,757,242 98,165,766

(a) Includes $1,533,624 in operating and maintenance grants in 2011 , -$7,463 in 2012, -$5,367 in 2013 and -$383,354 in 2014.


62 OCTOBER 2016

Table 17 Sewerage Department – Historical Operation and Maintenance Expenses Table 17

Sewerage DepartmentHistorical Operation and Maintenance Expenses (a)

2011 2012 2013 2014 2015$ $ $ $ $

Personal Services 23,972,125 24,403,860 24,785,716 23,301,162 30,903,283Services & Utilities 17,593,403 17,225,768 17,463,783 18,342,982 17,148,698Supplies & Materials 2,307,035 2,800,856 3,201,309 4,946,831 9,090,197Special Current Charges (460,199) 296,041 588,515 1,762,961 617,675Furniture & Equipment 222,279 157,870 199,073 205,113 268,870Repairs & Facility Maintenance 0 0 0 0 0________ ________ ________ ________ ________ Total Operation and Maintenance (b) 43,634,641 44,884,396 46,238,396 48,559,050 58,028,723

0 0 0 0 0(a)





Table 18 Sewerage Department – Capital Expenditures ‐ 2015 Table 18

Sewerage DepartmentCapital Expenditures

2015

Actual C.P. # Project Expenditures

$Sewerage Systems

313 Extensions & Replacements - Sewer Force Mains EPA Consent Decree 224,238317 Normal Extensions & Replacement of Gravity Mains 8,602,722318 Rehabilitation Gravity Sewer System 51,094326 Extensions & Replacements to Sewer Pumping Stations 101,581339 Mains in Street Dept. Contracts 3,060,270340 Sewerage Hurricane Recovery Bonds (FEMA) 2,146,280348 Normal Extensions & Replacements 5,883,071360 SELA Sewerage Relocation Costs 2,505,848368 Wetlands Assimilation Project 3,495,751369 Hurricane Katrina Expenses for Sewer System (62,199)375 Sewerage Hurricane Recovery Bonds 5,702,710380 FEMA Review of Change Orders-Sewer 4,610,630381 Modification & Extension of WBSTP to 20/50 MGD 30,400 _________

Total Sewerage System 36,352,396

Power Projects and General Budget600 Sewerage Share of Power Projects 2,253,304700 Sewer Reserve for Emergencies 280,987800 Sewerage Share of General Budget Items 8,042,394_________


Total Sewerage Department 46,929,082


64 OCTOBER 2016

Table 19 Sewerage Department – Proposed Capital Improvements Table 19

Sewerage DepartmentProjected Capital Improvements (a)

C.P. # Project 2016 2017 2018 2019 2020 Total$ $ $ $ $ $

Reinvestment in Assets317 Extensions and Replacements - Gravity Mains 25,326,000 32,727,000 31,800,000 65,276,000 1,700,000 156,829,000318 Rehabilitation Gravity Sewer System 6,435,000 5,035,000 6,435,000 5,035,000 8,435,000 31,375,000319 Extension and Replacements - Sanitary Sewer Mains Algiers 500,000 500,000 500,000 1,500,000326 Extensions and Replacements to Pumping Stations 3,960,000 5,990,000 6,790,000 2,300,000 3,600,000 22,640,000339 Mains in Streets Department Contracts 5,300,000 5,300,000 5,300,000 5,300,000 5,300,000 26,500,000348 Extensions and Replacements - Treatment Plants 8,580,000 3,595,000 4,805,000 5,225,000 850,000 23,055,000360 SELA Sewerage Relocation Costs 844,000 643,000 1,487,000382 Paving Repair Contracts 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 5,000,000600 Sewer Share of Power Projects 10,587,000 8,133,000 2,448,000 90,000 490,000 21,748,000702 Sewer Reserve for Emergencies 2,000,000 2,000,000 2,000,000 2,000,000 2,000,000 10,000,000800 Sewer Share of General Budget Items 12,599,000 9,338,000 8,288,000 6,934,000 7,386,000 44,545,000__________ __________ __________ __________ __________ __________

Total Routine Annual Improvements 77,131,000 74,261,000 69,366,000 93,160,000 30,761,000 344,679,000

Major Capital Improvements313 Extensions and Replacements - Sewer Force Mains 8,700,000 10,200,000 5,750,000 9,000,000 11,750,000 45,400,000358 WWTP Normal Extensions & Replacements 10,000 10,000368 Wetland Assimilation 8,300,000 300,000 8,600,000375 Sewerage Hurricane Recovery Bonds 15,610,000 5,000,000 5,000,000 7,000,000 32,610,000381 Modification and Expansion of WBSTP to 20/50 MGD 1,305,000 1,590,000 2,935,000 210,000 6,040,000383 Sewerage Hurricane Recovery Bonds (Non FEMA) 2,000,000 2,000,000__________ __________ __________ __________ __________ __________

Total Major Improvements 35,915,000 17,090,000 13,695,000 16,210,000 11,750,000 94,660,000__________ __________ __________ __________ __________ __________ Total Sewerage System Improvements 113,046,000 91,351,000 83,061,000 109,370,000 42,511,000 439,339,000




Table 20 Sewerage Department – Projected Operating Revenues Table 20

Sewerage DepartmentProjected Operating Revenue

(1) (2) (3)

TotalRevenue Service

From Additional Charge Year Charges Revenue (a) Revenue

$ $ $

2016 103,526,500 0 103,526,500

2017 103,675,100 10,118,200 113,793,300

2018 103,811,900 21,382,600 125,194,500

2019 103,947,600 33,743,200 137,690,800

2020 104,064,000 47,310,100 151,374,100

(a) Reflects additional revenue from adopted revenue increases.


66 OCTOBER 2016

Table 21 Sewerage Department – Projected Operation and Maintenance Expense Table 21

Sewerage DepartmentProjected Operation and Maintenance Expenses

2017 2018 2019 2020 2021$ $ $ $ $

Personal Services 27,120,300 27,933,900 28,771,900 29,635,100 30,524,100Services & Utilities 18,193,100 18,738,800 19,301,000 19,880,000 20,476,400Supplies & Materials 9,643,800 9,933,100 10,231,100 10,538,000 10,854,200Special Current Charges 655,300 674,900 695,200 716,100 737,500Furniture & Equipment 285,200 293,800 302,600 311,700 321,000Repairs & Facility Maintenance 0 0 0 0 0________ ________ ________ ________ ________ Total Operation and Maintenance 55,897,700 57,574,500 59,301,800 61,080,900 62,913,200



Table 22 Sewerage Department – Debt Service Requirements Table 22

Sewerage DepartmentDebt Service Requirements

Debt Issue 2016 2017 2018 2019 2020$ $ $ $ $

Existing BondsSeries 2014 19,342,700 19,309,800 17,642,500 16,217,500 16,234,100Series 2015 4,777,800 5,000,000 5,000,000 5,000,000 5,000,000Series 2011 (LADEQ) 495,700 496,700 496,600 496,500 496,400_________ _________ _________ _________ _________ Total Existing Debt Service 24,616,200 24,806,500 23,139,100 21,714,000 21,730,500


$2016 0 0 0 0 0 02017 130,000,000 3,726,958 8,944,700 8,944,700 8,944,7002018 0 0 0 02019 32,000,000 917,417 2,201,8002020 0 0_________ _________ _________ _________ _________

Total Projected Debt Service 0 3,726,958 8,944,700 9,862,117 11,146,500_________ _________ _________ _________ _________ Total Debt Service 24,616,200 28,533,458 32,083,800 31,576,117 32,877,000


68 OCTOBER 2016

Table 23 Sewerage Department – Capital Improvement Program Financing Table 23

Sewerage DepartmentCapital Improvement Program Financing

Line Fiscal Year Endiing December 31, No. Description 2016 2017 2018 2019 2020 Total

$ $ $ $ $ $

1 Funds Available at Beginning of Year 133,675,100 33,886,500 91,154,000 41,596,400 369,800 133,675,1002 Revenue Bond Proceeds 0 130,000,000 0 32,000,000 0 162,000,0003 Operation Fund Transfers 13,000,000 23,000,000 29,000,000 40,000,000 51,000,000 156,000,0004 Participation by Others 35,030,000 8,726,200 8,894,600 8,780,100 1,164,900 62,595,8005 Interest Income 842,500 527,500 667,200 186,600 25,800 2,249,600__________ __________ __________ __________ __________ __________ 6 Total Funds Available 182,547,600 196,140,200 129,715,800 122,563,100 52,560,500 516,520,500

7 Obligated Contracts & Capital Jobs (35,615,100) 0 0 0 0 (35,615,100)8 Reinvestment in Assets (77,131,000) (76,488,800) (73,590,400) (101,798,400) (34,621,800) (363,630,400)9 Major Capital Additions (35,915,000) (17,602,700) (14,529,000) (17,713,100) (13,224,700) (98,984,500)10 Bond Issuance Expense 0 (1,950,000) 0 (480,000) 0 (2,430,000)11 Revenue Bond Reserve Fund 0 (8,944,700) 0 (2,201,800) 0 (11,146,500)__________ __________ __________ __________ __________ __________ 12 Total Application of Funds (148,661,100) (104,986,200) (88,119,400) (122,193,300) (47,846,500) (511,806,500)

13 End of Year Balance 33,886,500 91,154,000 41,596,400 369,800 4,714,000 4,714,000



Table 24 Sewerage Department – Analysis of Ability of Forecasted Revenue to Finance Projected Revenue Requirements Table 24

Sewerage DepartmentAnalysis of Ability of Forecasted Revenue toFinance Projected Revenue Requirements

Line Fiscal Year Endiing December 31, No. Description 2016 2017 2018 2019 2020

$ $ $ $ $

1 Revenue from Charges 103,526,500 103,675,100 103,811,900 103,947,600 104,064,0002 Total Additional Revenue (a) 0 10,118,200 21,382,600 33,743,200 47,310,100__________ __________ __________ __________ __________ 3 Total Service Charge Revenue 103,526,500 113,793,300 125,194,500 137,690,800 151,374,1004 Interest Income 567,700 586,600 594,000 605,100 612,8005 Plumbing Insp. & License Fees 326,100 326,100 326,100 326,100 326,1006 Other Miscellaneous Income 597,300 597,300 597,300 597,300 597,3007 Interest from Bond Reserve Fund 299,000 344,000 389,000 400,000 411,000__________ __________ __________ __________ __________ 8 Total Operating Revenue 105,316,600 115,647,300 127,100,900 139,619,300 153,321,300

9 Operation & Maintenance (54,269,600) (55,897,700) (57,574,500) (59,301,800) (61,080,900)10 Provision for Claims (264,400) (264,400) (264,400) (264,400) (264,400)11 Provision for Doubtful Accounts (1,138,800) (1,251,700) (1,377,100) (1,514,600) (1,665,100)__________ __________ __________ __________ __________ 12 Net Operating Revenue 49,643,800 58,233,500 67,884,900 78,538,500 90,310,900


13 Existing (24,616,200) (24,806,500) (23,139,100) (21,714,000) (21,730,500)14 Projected 0 (3,727,000) (8,944,700) (9,862,100) (11,146,500) __________ __________ __________ __________ __________ 15 Subtotal (24,616,200) (28,533,500) (32,083,800) (31,576,100) (32,877,000)

Subordinate Revenue Bonds16 Gulf Opportunity Zone Act Loan (6,235,200) (6,235,200) (6,235,200) (6,235,200) (6,235,200)__________ __________ __________ __________ __________ 17 Total Debt Service (30,851,400) (34,768,700) (38,319,000) (37,811,300) (39,112,200)

18 Other Non-Operating Revenue 462,100 462,100 462,100 462,100 462,10019 Transfer to Construction (13,000,000) (23,000,000) (29,000,000) (40,000,000) (51,000,000)20 Due from/(to) Other Departments (2,911,000) (486,000) 0 0 021 Transfer to Operating Reserve Fund 0 0 0 0 (313,900)22 Transfer from/(to) Rate Stabilization Fund 0 0 0 0 0

23 Net Annual Balance 3,343,500 440,900 1,028,000 1,189,300 346,900

24 Beginning of Year Cash Balance (b) 24,722,800 28,066,300 28,507,200 29,535,200 30,724,50025 End of Year Balance 28,066,300 28,507,200 29,535,200 30,724,500 31,071,400

26 Beginning of Year Cash Balance (b) 24,722,800 28,066,300 28,507,200 29,535,200 30,724,50027 Operating Reserve Fund 0 0 0 0 313,90028 Net annual Balance 3,343,500 440,900 1,028,000 1,189,300 346,90029 End of Year Balance 28,066,300 28,507,200 29,535,200 30,724,500 31,385,30030 Days of O&M Cash on Hand 184 181 182 184 182

(a)

(b)

Reflects revenue from an eight-year series of annual 10% rate increases effective January 1, 2013; adopted by the City Council in 2012.Reflects beginning of year balance in unrestricted and undesignated cash and cash equivalents and cash and cash equivalents designated for capital projects, less operating reserve requirement.


70 OCTOBER 2016

Table 25 Sewerage Department – Coverage Requirements Table 25

Sewerage DepartmentCoverage Requirements

LineNo. Coverage Requirements 2016 2017 2018 2019 2020

$ $ $ $ $

Projected Net Revenues1 Revenue Under Existing Rates (a) 103,526,500 113,793,300 125,194,500 137,690,800 151,374,1002 Additional Revenue Under Proposed Rates 0 10,118,200 21,382,600 33,743,200 47,310,1003 Interest Income 1,709,200 1,458,100 1,650,200 1,191,700 1,049,6004 Plumbing and Inspection Fees 326,100 326,100 326,100 326,100 326,1005 Other Miscellaneous Revenue 597,300 597,300 597,300 597,300 597,3006 Transfer from Rate Stabilization Fund 0 0 0 0 07 Operation & Maintenance (54,269,600) (55,897,700) (57,574,500) (59,301,800) (61,080,900)________ ________ ________ ________ ________ 8 Net Revenue 51,889,500 70,395,300 91,576,200 114,247,300 139,576,300

Rate Covenant Coverage9 Projected Net Revenues 51,889,500 70,395,300 91,576,200 114,247,300 139,576,300

Annual Debt Service10 Senior Debt 24,616,200 28,533,500 32,083,800 31,576,100 32,877,00011 Coverage (a) 211% 247% 285% 362% 425%12 All Debt 30,851,400 34,768,700 38,319,000 37,811,300 39,112,20013 Coverage (b) 168% 202% 239% 302% 357%

Additional Bond Coverage14 Preceding Year Projected Net Revenues 40,137,200 51,889,500 70,395,300 91,576,200 114,247,30015 Future Additional Revenue (c) 58,387,300 48,046,600 34,316,500 21,800,500 10,394,800_________ _________ _________ _________ _________16 Adjusted Projected Net Revenues 98,524,500 99,936,100 104,711,800 113,376,700 124,642,100

Maximum Debt Service17 Senior Debt 24,806,500 32,083,800 32,083,800 32,877,000 32,877,00018 Coverage (a) 397% 311% 326% 345% 379%19 All Debt 31,041,700 38,319,000 38,319,000 39,112,200 39,112,20020 Coverage (b) 317% 261% 273% 290% 319%

(a) The General Bond Resolution requires net revenue to equal or exceed 125% of debt service.(b) The General Bond Resolution requires net revenue to equal or exceed 110% of debt service.(c) Reflects revenue an eight-year series of annual 10% rate increases effective January 1, 2013; adopted by the

City Council in 2012.


BLACK & VEATCH | Drainage Department 71

Drainage Department

2015 DRAINAGE DEPARTMENT OPERATIONS TheSewerageandWaterBoardhasprovidedforthedrainageneedsofNewOrleanssince1903.TheCityencompassesasaucer‐shapeddepressionbetweentheMississippiRiverandLakePontchartrainontheEastBankandanareaborderedbytheriverandadjoiningwetlandsontheWestBank.PriortoJanuary1,1967,whenthethree‐milldrainagetaxbecameeffective,theCityofNewOrleanswasobligatedtoreimbursetheBoardforthecostofoperatingandmaintainingdrainagefacilities.

In1969,studiesofprojectedcapitalimprovementfinancingneedsandrevenuerequirementsindicatedtheneedforadditionalsourcesoffunds.Constitutionalamendments,whichwouldhaveprovidedtherequiredfundsfromanadditionalthree‐milladvaloremtax,wereofferedin1970,andagainin1972.TheState’selectoraterejectedbothamendments;however,anadditionalsix‐milladvaloremtaxwasapprovedApril16,1977andbecameeffectiveJanuary1,1978.Subsequently,anine‐millpropertytaxincreasewasapprovedMay16,1981andimplementedJanuary1,1982.Thenine‐milltaxistobeusedforoperationandmaintenance,aswellasfundingofcapitalimprovements.

TheBoardischargedwithoperating,maintaining,repairing,andexpandingthemajordrainagesystemlocatedthroughouttheCity.

Revenues

RevenuesthatwereavailabletotheDrainageDepartmentforoperationandmaintenanceexpenses,andcapitaladditions,consistedofproceedsfromthethree‐mill,six‐mill,andnine‐milladvaloremtax,interestoninvestments,andmiscellaneousincome.OtherrevenuesavailableforDrainageDepartmentcapitalimprovementsincludedinterestincomeandothermiscellaneoussources.

AsummaryofhistoricalrevenuesreceivedbysourceisshowninTable26fortheperiod2011through2015.ThehistoricalrevenueshowninTable26wasdevelopedfromdetailedrecordsprovidedbyBoardStaff.


Table27presentsasummaryof2011through2015operationandmaintenanceexpensesoftheDrainageDepartment.Expendituresfor2015increasedabout22.4percentover2014expenditures.Operationandmaintenanceexpenseshaveincreasedanaverageof4.2percentperyearoverthefive‐yearperiodshown.HistoricaloperationandmaintenanceexpensesshowninTable27donotincludethenon‐cashportionofProvisionforClaimsasrecordedintheComprehensiveAnnualFinancialReport.EstimateoffutureDrainageDepartmentclaimsareincludedonLine9inTable35.


CapitalexpendituresoftheDrainageDepartmentincludethecostofreplacementsandimprovementstopumpingstationsandcanalsandtheDrainageDepartment’sproratashareofpowerprojectsandgeneralbudgetcosts.

TheDrainageDepartmentcapitalimprovementexpendituresfor2015totaled$20,727,040.TheDrainageDepartment’scapitalimprovementexpendituresfortheyearareshowninTable28.


72 OCTOBER 2016


ThefollowingtabulationshowsasummaryofreceiptsandexpendituresoftheDrainageDepartmentduring2015:



Claims 1,228,302


Revenue Primarily Available for Capital Expenditures a 13,310,232a Excludes depreciation.

PROPOSED CAPITAL IMPROVEMENT PROGRAM Table29presentsasummaryoftheprojectedmajorcapitalimprovementprogramfortheperiod2016through2020.Table29isbasedontheBoard’s2016‐2025CapitalProgram.Thefive‐yearmajorcapitalimprovementprogramcostsareexpectedtototal$650,961,000.Majorbudgetitemsincludeextensionandenlargementofcanalsplusincreasedpumpingcapacity.

Participationbyothersconsistsofmoniescollectedfromdevelopersandindividualsfortheextensionofdrainageservicetonewcustomersandfromgovernmentalagenciesforreplacementandexpansionofsystemfacilities.AsshowninTable30,futurerevenuesfromthesesourcesareestimatedbytheBoardinthe2016through2025CapitalProgramaccordingtocapitalprojectandamountto$393,523,000,mostofwhichisprovidedbytheCOE.

TheSewerageandWaterBoardiscurrentlyreceivingfundsfromtheCOEsponsoredandcongressionallyauthorizedSoutheastLouisianaUrbanFloodControl(SELA)Project.Thisfundingwillallowadditionalconstructionofprojectswhichwereidentifiedinthe1970s,butwhichhavenotbeencompletedbecauseoffundinglimitations.Theidentifiedprojectsaretobefundedeither100percentfromfederalfundsor65percentfromfederalfundsand35percentfromlocalfunds.Thepaybackperiodforthelocalshareis30yearsandisanticipatedtobeginin2019.

ABILITY TO FINANCE PROPOSED CAPITAL EXPENDITURES DrainageDepartmentfutureoperatingandcapitalcostrequirementsaretobemetbytherevenuesourcespreviouslydiscussed.In2015,thethree‐mill,six‐mill,andnine‐milladvaloremtaxesweretheprincipalsourceofoperatingfundsfortheDrainageDepartment.

Revenues

ProjectedoperatingincomeofthedrainagesystemisshowninTable31.Projectionsincludeproceedsfromthethree‐mill,thesix‐mill,andthenine‐milladvaloremtaxandotherrevenueandarebasedonthe2014assessedtaxablevalue.Thethree‐milladvaloremtaxwillexpirein2016.Itisassumedthattheprojectedrevenuefromthesix‐andnine‐milltaxeswillremainconstantduringthestudyperiodduetotheroll‐backprovisionsofLouisianastatelaw.

Othersourcesofincomeincludeinterestearnedfromtheinvestmentoffundsheldforfutureuse;salesofthree‐mill,six‐mill,andnine‐milladvaloremtaxbonds;andparticipationbyothers.



Projectionsofinterestincome,whichvaryaccordingtothebalanceoffundsheldforfutureuse,areshowninalatersectionofthisreport.

Theprojectionofmillagerevenuefor2016through2020isbasedon4.66,4.71,and7.06millsforthree‐mill,six‐mill,andnine‐milltaxes,respectively.


AsummaryofprojectedoperationandmaintenanceexpensesisshowninTable32.Estimatesoffutureexpensesarebasedonanticipatedfutureoperatingconditionsandallowancesforinflationaryfactors.

Projectionsoffutureoperatingandmaintenanceexpensesforthestudyperiodarebasedon2015actualexpensesprovidedbytheSWBNOandananalysisofthecurrentandanticipatedoperatingconditionsandtrends.IncludedintheprojectedoperationandmaintenanceexpenseistheanticipatedoperatingcostsofthelakefrontpermanentpumpandstormsurgeclosurestationsthatwillbecompletedbyJune1,2017.Thesecostsareestimatedat$4,000,000in2018and$8,000,000eachyearafter.


Nine‐millbondsintheamountof$14,900,000wereissuedin2014,andasofDecember31,2015,$12,750,000remainedoutstanding.

Collectionofthethree‐milladvaloremtaxlevyisauthorizedthrough2016;six‐milltaxthrough2028;andnine‐milltaxthrough2032.

TheDrainageDepartmenthasborrowedfromtheCityofNewOrleansDepartmentofPublicWorks(DPW).Itisanticipatedthatthisamountwillbereimbursedduringthestudyperiod.


TotalrevenuerequirementsfortheDrainageDepartmentrecognizedforpurposesofthisreportincludeoperationandmaintenanceexpense,allowanceforclaims,debtservicecostsonmajorcapitalimprovementsfinancedthroughthesaleofbonds,andexpendituresforcapitalimprovementsnotfinancedfrombondproceeds.Table34examinesthefinancingofthemajorcapitalimprovementprogramandTable35summarizesthefinancingofoperationandmaintenanceexpense,debtservicecostsonoutstandingandproposedbonds,andthetransferofoperatingfundsformajorcapitalimprovementfinancing.


Table34presentsthemajorcapitalimprovementfinancingplanwhichsummarizestheprojectedsourceandapplicationoffundsoverthefive‐yearstudyperiod.TheamountofFundsAvailableatBeginningofYear,shownonLine1,is$24,860,700.ThisamountisbasedonauditeddataprovidedbytheBoard.

ProjectedrevenuebondproceedsareshownonLine2;however,itisprojectedthattheBoardwillnothavethecapacitytoissueadditionalbondsduringthestudyperiod.Inaddition,itisanticipatedthattheBoardwillnothavethecapacitytofinancethemajorcapitalimprovementprogramwithoperatingrevenueasshownonLine3.


74 OCTOBER 2016

OthersourcesoffundsavailabletomeetmajorcapitalimprovementexpendituresareParticipationbyOthersandinterestincome.ParticipationbyOthers,asshownonLine4includesanticipatedfundingbytheU.S.ArmyCorpsofEngineers(COE)andFEMAaswellasothers.Interestearningsrecognizeanassumed1.0percentaverageannualinterestrateandareshownonLine5.Line6ofthetableshowstheprojectedmajorcapitalimprovementfundsavailableeachyear.

AsofDecember31,2015,theBoardhad$24,497,900obligatedforopencontractsandcapitaljobsasshownonLine7ofTable34.Lines8and9showtheprojectedReinvestmentinAssetsandMajorCapitalAdditionstobefundedasshowninTable29.Duetoconstraintsonrevenue,itisanticipatedthatthecapitalprojectsduringthe5‐yearperiodwillexceedtheamountoffundingavailableandsomeprojectswillneedtobedeferreduntilanadditionalrevenuesourcehasbeenidentified.ThisdeferralisshownonLine10.


Operating Fund

MoneydepositedintheDrainageSystemFundisobtainedprimarilyfromthethree‐mill,six‐mill,andnine‐milladvaloremtaxasshownonLines1through3ofTable35.Thethree‐milladvaloremtaxwillexpirein2016.

OtherrevenueavailableforsystemoperationsisshownonLines4through6.MiscellaneousrevenueonLine4includesrentalincome,gainorlossonthesaleofassetsandothermiscellaneousincome.InterestIncomeavailabletotheoperatingfund,shownonLine5,isestimatedtobe1.0percentoftheaverageofthebeginningandendofyearNetAnnualBalance,exceptastheaverageisaffectedbyidentifiablenonrecurringmajorreceipts,transfers,orexpendituresduringtheyear.InterestfromtheBondReserveFund,shownonLine6,isestimatedtobe1.0percent.TotalOperatingRevenueisshownonLine7ofTable35.

OperationandMaintenanceexpense,previouslyprojectedinTable32,isshownonLine8ofTable35.Line9showstheestimatedallowanceforclaims.Baddebtexpenseisassumedtobe0.5percentofprojectedrevenueandisshownonLine10.ProjectedNetOperatingRevenuefromsystemoperationsisshownonLine11.

Lines12through14presentdebtservicerequirementsoncurrentlyoutstandingandproposedseniorrevenuebonds.ExistingdebtincludestheSeries2014bonds.Aspreviouslymentioned,itisprojectedthattheBoardwillnothavethecapacitytoissueadditionalbondsduringthestudyperiod.

InJulyof2006theBoardenteredintoaCooperativeEndeavorAgreementwiththeStateofLouisianatosecureproceedsfromtheState’sGulfOpportunityTaxCreditBondLoanProgramtoassistinpaymentofdebtservicerequirementsfrom2006through2008.TheBoardhasborrowed$77,465,247onthisagreement.Noprincipalorinterestwaspayableduringtheinitialfive‐yearperiodoftheloan,butafterthatperiod,theloanbegantobearaninterestrateof4.64percent.PaymentsforthedrainageportionofprincipalandinterestbeganinJuly2012andareshownonLine15ofTable35.



Line16reflectstheestimatedSELArepaymentsthatwillbeginin2019.TotaldebtserviceisshownonLine17.

Anticipatednon‐operatingrevenueisshownonLine18.Line19reflectstheprojectedtransferofaccumulatednetearningsfromsystemoperationstoassistinmajorcapitalfinancing.Typically,suchaccumulatednetearningsmaybeusedtohelprecoverportionsoftheannualcostsofsystemoperationsortoassistinmajorcapitalimprovementfinancing.Line20reflectsrepaymentfromtheWaterDepartmentandrepaymenttotheDepartmentofPublicWorksaswellasrepaymenttoclaimants.

TheGeneralResolutionrequiresanOperatingReserveFundof90daysofthepreviousyear’soperationandmaintenanceexpense;howevertheSWBNO’sFinancialManagementPolicyrequiresanOperatingReserveFundofnotlessthan180days.Line21indicatestheprojectedannualtransfersavailabletomeetthisrequirementthroughoutthestudyperiod.

Line22indicatedtheestimatedNetAnnualBalancefromoperationsremainingattheendofeachyear.

Thebalanceofoperatingfundsavailableatthebeginningoftheyear2016,shownonLine23,iscomprisedofcurrentcashassetsandreflectsabalanceof$23,602,600.TheEndofYearBalance,whichisexclusiveoftheoperatingreservefund,isshownonLine24anddropstoadeficitof$8,167,800by2020whichindicatesthattheexistingsourceofrevenuefortheDrainageDepartmentwillnotbesufficienttofundoperationandmaintenanceexpenseandrequireddebtservicepaymentsby2020.

Lines25through29demonstratethattheBoardismaintaininganoperatingreserveequaltoatleast180daysofthepreviousyear’soperationandmaintenanceexpensethrough2018;howeverthebalancedropsto‐28daysby2020.


ArequirementoftheDrainageBondResolutionprovidesthatrevenuesderivedfromthenine‐milladvaloremtaxshouldprovideanamountsufficienttoprovidefortheinterestandprinciplepaymentontheSeries2014bonds.AsshownonLine30ofTable35theprojectedrevenuefromthenine‐milladvaloremtaxwillprovidesufficientrevenuetomeetcoveragerequirementsonexistingdebtduringthestudyperiod.

TheDrainageBondResolutionalsoprovidesthatadditionalparitybondsmaybeissued,butonlyaftercertainconditionshavebeenmet.Oneconditionisthattherevenuesderivedfromthenine‐milladvaloremtaxforthemostrecentlycompletedcalendaryearpriortotheyearofissuanceareequaltoatleastoneandone‐third(1‐1/3)timesthemaximumdebtserviceonallbondsoutstandingandtheadditionalbonds.

Duetotheconstraintstomeetoperationandmaintenanceexpenseandrequireddebtservicepaymentsonexistingdebtduringthestudyperiod,theDrainageDepartmentdoesnothavetherevenuecapacitytoissueadditionaldebt.Inaddition,therevenuefromthenine‐milladvaloremtaxdoesnotprovidethedebtcapacityneededtofundthefive‐yearcapitalimprovementprogram;thereforeasignificantportionofcapitalimprovementsmustbedeferredaspreviouslymentioned.In


76 OCTOBER 2016

theeventthatthethree‐milladvaloremtaxisapprovedbyvotersforreauthorization,itisprojectedthatthiswillprovidetherevenueneededtofundoperationandmaintenanceexpenseanddebtserviceonexistingdebt;however,itwillnotprovidefundingformajorcapitalimprovements.Therefore,inordertocompletelyfundthefive‐yearcapitalprogram,analternativefundsourcewouldneedtobeidentifiedfortheDrainageDepartment.

Black&Veatchsuggeststhatwhenanewfundingsourceisidentified,theBoardworkwithitsbondcounselandfinancialadvisortorefundalloutstandingdebtatthattimeandissuenewdebtreflectingageneralbondresolutionthatincludesthenewfundingsourceandallotherrevenueinthecoveragecalculationandreflectscovenantsmoreconsistentwiththe2014waterandsewerageresolutions.ItisanticipatedthattheBoardwillhavethecapacitytodebtfinancemoreprojectsunderthenewresolution.



Table 26 Drainage Department – Historical Revenues Received Table 26

Drainage DepartmentStatement of Historical Revenue

Revenue Source 2011 2012 2013 2014 2015$ $ $ $ $

Three-mill Ad Valorem Tax 11,129,376 12,497,723 13,175,711 13,481,526 14,139,193Six-mill Ad Valorem Tax 11,242,927 12,630,977 13,317,505 13,626,539 14,290,667Nine-mill Ad Valorem Tax 16,855,081 18,933,290 19,962,114 20,425,388 21,421,102Two-mill Ad Valorem Tax 4,870 0 0 0 0Interest Earned 128,571 109,748 92,615 203,832 202,579Other 1,107,419 1,103,330 1,099,908 1,277,250 4,313,845_________ _________ _________ _________ _________ Total Revenue 40,468,244 45,275,067 47,647,853 49,014,535 54,367,386


78 OCTOBER 2016

Table 27 Drainage Department – Historical Operation and Maintenance ExpensesTable 27

Drainage DepartmentHistorical Operation and Maintenance Expenses (a)

2011 2012 2013 2014 2015$ $ $ $ $

Personal Services 19,042,343 18,544,593 18,836,845 17,096,914 25,494,930Services & Utilities 11,625,307 11,165,440 11,258,057 11,460,611 10,324,968Supplies & Materials 1,379,826 1,909,601 1,937,679 1,523,346 1,511,946Special Current Charges 626,289 800,572 578,960 756,295 372,914Furniture & Equipment 78,332 66,823 91,674 62,057 109,745Repairs & Facility Maintenance 0 0 0 0 0________ ________ ________ ________ ________ Total Operation and Maintenance (b) 32,752,097 32,487,029 32,703,215 30,899,222 37,814,502

0 0 0 0 0(a)





Table 28 Drainage Department – Capital Expenditures ‐ 2015 Table 28

Drainage DepartmentCapital Expenditures

2015

ActualC.P. # Project Expenditures

$Canals

418 Normal Extensions & Replacements 62,256439 Major Drainage Participation in DPW Projects 856,549466 Louisiana Avenue Canal (SELA) 875,674471 SELA Program Management 2,553,172476 Hollygrove Canals (SELA-A) 24,929478 S. Claiborne-Lowerline to Monticello Street 1,560,604480 FEMA Review of Change Orders-Drainage (6,347,999)486 Napoleon Canal Improvements (SELA-B) 856,051497 Florida Ave. Canad - DPS#19 to Peoples Ave. (SELA-B) (4,065,824)498 Dwyer Intake Canal (St. Charles to Dwyer DPS) (SELA-A) 463,694499 Jefferson Avenue Canal 1,571,027_________

Total Drainage Canals (1,589,867)

Pumping Stations511 Normal Extensions & Rep./Stations 116,470574 Hurricane Katrina Expenses for Drainage System 47,832575 Drainage Hurricane Recovery Bonds 177,238_________

Total Drainage Pumping Stations 341,539

Power Projects and General Budget600 Drainage Share of Power Projects 17,000,759703 Drainage Reserve for Emergency 225,678800 Drainage Share of General Budget Items 4,748,931_________


Total Drainage Department 20,727,040


80 OCTOBER 2016

Table 29 Drainage Department – Proposed Capital Improvements Table 29

Drainage DepartmentProjected Capital Improvements (a)

C.P.# Project 2016 2017 2018 2019 2020 Total$ $ $ $ $ $

Reinvestment in Assets418 Normal Ext. & Replacements 750,000 750,000 770,000 770,000 790,000 3,830,000511 Normal Ext. & Replacement - Stations 17,077,000 52,673,000 28,748,000 14,340,000 2,820,000 115,658,000600 Drainage Share of Power Projects 61,212,000 31,000,000 11,418,000 5,015,000 12,180,000 120,825,000703 Drainage Reserve for Emergencies 2,000,000 2,000,000 2,000,000 2,000,000 2,000,000 10,000,000800 Drainage Share of General Budget Items 11,459,000 6,214,000 4,862,000 4,376,000 4,557,000 31,468,000____________________________________________________________

Total Routine Capital Improvements 92,498,000 92,637,000 47,798,000 26,501,000 22,347,000 281,781,000

Major Capital Improvements439 Mains, Over 36" in Street Dept. Contracts 4,300,000 4,300,000 4,300,000 4,300,000 4,300,000 21,500,000453 Improvements to Metairie Relief Canal 5,992,000 5,992,000466 Louisiana Ave. Canal 600,000 600,000 600,000 1,800,000471 SELA Program Management 1,500,000 1,500,000 1,500,000 4,500,000478 S. Claib - Lowerline to Monticello St. 220,000 220,000 440,000483 Airline & Monticello Canal Improvements 50,000 948,000 30,000,000 500,000 31,498,000486 Napoleon Avenue Canal Improvements 450,000 300,000 750,000492 Donner Canal Improvements 17,000 595,000 2,210,000 112,788,000 115,610,000496 General De Gaulle Canal 70,000,000 70,000,000 140,000,000497 Florida Avenue Canal - DPS #19 to Peoples 950,000 300,000 1,250,000498 Dwyer Intake Canal 50,000 50,000499 Jefferson Avenue Canal 910,000 910,000 510,000 2,330,000512 Expansion of DPS #15 1,220,000 14,500,000 15,720,000535 DPS #6 340,000 160,000 1,680,000 320,000 2,500,000573 DPS #13 Improvements 440,000 6,000,000 1,000,000 10,000,000 1,000,000 18,440,000575 Drainage Hurricane Recovery Bonds 6,600,000 6,600,000578 Permanent Pump Stations at the Laek Elaine DPS Repairs 200,000 200,000__________ __________ __________ __________ __________ __________

Total Major Capital Improvements 22,419,000 86,893,000 124,980,000 129,268,000 5,620,000 369,180,000__________ __________ __________ __________ __________ __________ Total Drainage Department Improvements 114,917,000 179,530,000 172,778,000 155,769,000 27,967,000 650,961,000




Table 30 Drainage Department – Projected Participation by Others Table 30

Drainage DepartmentProjected Participation by Others (a)

C.P.# Project 2016 2017 2018 2019 2020 Total$ $ $ $ $ $

418 Normal Extensions& Replacements 230,000 230,000 230,000 230,000 230,000 1,150,000453 Improvements to Metairie Relief Canal 1,408,000 1,408,000483 Airline & Monticello Canal Improvements 50,000 948,000 30,000,000 500,000 31,498,000492 Donner Canal Improvements 112,788,000 112,788,000496 General De Gaulle Canal 70,000,000 70,000,000 140,000,000511 Normal Ext. & Replacement -DPS 1,013,000 13,457,000 14,470,000535 DPS #6 160,000 320,000 320,000 800,000575 Hurricane Recovery Bonds 6,600,000 6,600,000613 Modifications to Power Generating System 1,400,000 1,400,000676 Modifications to Power Generating System HMGP 53,285,000 29,478,000 82,763,000807 Improvements to Central Yard and St. Joseph St 646,000 646,000__________ __________ __________ __________ __________ __________

Total 64,632,000 114,113,000 100,390,000 113,838,000 550,000 393,523,000



82 OCTOBER 2016

T able 31 Drainage Department – Projected Operating Revenues Table 31

Drainage DepartmentProjected Operating Revenue

Ad Valorem Tax RevenueYear Three-Mill Six-Mill Nine-Mill Other Total

$ $ $ $ $

2016 14,147,600 14,299,400 21,404,000 969,200 50,820,200

2017 0 14,299,400 21,404,000 979,000 36,682,400

2018 0 14,299,400 21,404,000 989,000 36,692,400

2019 0 14,299,400 21,404,000 999,000 36,702,400

2020 0 14,299,400 21,404,000 1,009,000 36,712,400



Table 32 Drainage Department – Projected Operation and Maintenance ExpensesTable 32

Drainage DepartmentProjected Operation and Maintenance Expenses

2016 2017 2018 2019 2020$ $ $ $ $

Personal Services 20,759,800 21,382,600 22,024,000 22,684,800 23,365,300Services & Utilities 10,634,700 14,953,800 19,402,400 19,984,400 20,584,000Supplies & Materials 1,557,300 1,604,000 1,652,100 1,701,700 1,752,800Special Current Charges 384,100 395,600 407,500 419,700 432,300Furniture & Equipment 113,000 116,400 119,900 123,500 127,200Repairs & Facility Maintenance 0 0 0 0 0________ ________ ________ ________ ________ Total Operation and Maintenance 33,448,900 38,452,400 43,605,900 44,914,100 46,261,600


84 OCTOBER 2016

Table 33 Drainage Department – Debt Service Requirements Table 33

Drainage DepartmentDebt Service Requirements

Debt Issue 2016 2017 2018 2019 2020$ $ $ $ $

Nine-Mill Tax BondsSeries 2014 2,017,100 2,051,900 2,063,400 2,069,200 2,066,200________ ________ ________ ________ ________ Total Nine-Mill Debt Service 2,017,100 2,051,900 2,063,400 2,069,200 2,066,200


$2016 0 0 0 0 0 02017 0 0 0 0 02018 0 0 0 02019 0 0 02020 0 0________ ________ ________ ________ ________ Total Projected Debt Service 0 0 0 0 0________ ________ ________ ________ ________ Total Debt Service 2,017,100 2,051,900 2,063,400 2,069,200 2,066,200



Table 34 Drainage Department – Capital Improvement Program Financing Table 34

Drainage DepartmentCapital Improvement Program Financing

Line Fiscal Year Endiing December 31,No Description 2016 2017 2018 2019 2020 Total

$ $ $ $ $ $

1 Funds Available at Beginning of Year 24,860,700 84,300 5,200 4,800 700 24,860,7002 Revenue Bond Proceeds 0 0 0 0 0 03 Operation Fund Transfers 0 0 0 0 0 04 Participation by Others 64,632,000 117,536,400 106,503,800 124,393,900 619,000 413,685,1005 Interest Income 125,500 400 0 0 0 125,900__________ __________ __________ __________ __________ __________ 6 Total Funds Available 89,618,200 117,621,100 106,509,000 124,398,700 619,700 438,671,700

7 Obligated Contracts & Capital Jobs (24,497,900) 0 0 0 0 (24,497,900)8 Revinvestment in Assets (92,498,000) (95,416,100) (50,708,900) (28,958,400) (25,151,700) (292,733,100)9 Major Capital Additions (22,419,000) (89,499,800) (132,591,300) (141,254,600) (6,325,400) (392,090,100)10 Deferred Capital Improvements 49,881,000 67,300,000 76,796,000 45,815,000 30,858,000 270,650,00011 Bond Issuance Expense 0 0 0 0 0 012 Revenue Bond Reserve Fund 0 0 0 0 0 0__________ __________ __________ __________ __________ __________ 13 Total Application of Funds (89,533,900) (117,615,900) (106,504,200) (124,398,000) (619,100) (438,671,100)

14 End of Year Balance 84,300 5,200 4,800 700 600 600


86 OCTOBER 2016

Table 35 Drainage Department – Analysis of Ability of Forecasted Revenue to Finance Projected Revenue Requirements

Table 35

Drainage DepartmentAnalysis of Ability of Forecasted Revenue toFinance Projected Revenue Requirements

Line Fiscal Year Endiing December 31,No Description 2016 2017 2018 2019 2020

$ $ $ $ $

1 Three-Mill Ad Valorem Tax Revenue (4.66 Mills) (a) 14,147,600 0 0 0 02 Six-Mill Ad Valorem Tax Revenue (4.71 Mills) 14,299,400 14,299,400 14,299,400 14,299,400 14,299,4003 Nine-Mill Ad Valorem Tax Revenue (7.06 Mills) 21,404,000 21,404,000 21,404,000 21,404,000 21,404,0004 Other Miscellaneous Income 969,200 979,000 989,000 999,000 1,009,0005 Interest Income 305,900 344,700 270,200 154,900 8,1006 Interest from Bond Reserve Fund 0 0 0 0 0__________ __________ __________ __________ __________ 7 Total Operating Revenue 51,126,100 37,027,100 36,962,600 36,857,300 36,720,500

8 Operation & Maintenance (33,448,900) (38,452,400) (43,605,900) (44,914,100) (46,261,600)9 Provision for Claims (1,011,800) (1,011,800) (1,011,800) (1,011,800) (1,011,800)10 Provision for Doubtful Accounts (249,300) (178,500) (178,500) (178,500) (178,500)__________ __________ __________ __________ __________ 11 Net Operating Revenue 16,416,100 (2,615,600) (7,833,600) (9,247,100) (10,731,400)


12 Existing (2,017,100) (2,024,100) (2,028,400) (2,028,600) (2,036,000)13 Projected 0 0 0 0 0 __________ __________ __________ __________ __________ 14 Subtotal (2,017,100) (2,024,100) (2,028,400) (2,028,600) (2,036,000)15 Gulf Opportunity Zone Act Loan (407,600) (407,600) (407,600) (407,600) (407,600)16 SELA Capital Repayment 0 0 (1,251,900) (3,850,800)__________ __________ __________ __________ __________ 17 Total Debt Service (2,424,700) (2,431,700) (2,436,000) (3,688,100) (6,294,400)

18 Other Non-Operating Revenue 701,700 701,700 701,700 701,700 701,70019 Transfer to Construction 0 0 0 0 020 Due from (to) Other Departments (2,196,000) (921,000) 0 0 021 Transfer to Operating Reserve Fund 0 538,200 (616,900) (635,400) (161,300)

22 Net Annual Balance 12,497,100 (4,728,400) (10,184,800) (12,868,900) (16,485,400)

23 Beginning of Year Cash Balance (b) 23,602,600 36,099,700 31,371,300 21,186,500 8,317,60024 End of Year Balance 36,099,700 31,371,300 21,186,500 8,317,600 (8,167,800)

25 Beginning of Year Cash Balance 23,602,600 40,761,800 36,033,400 25,848,600 12,979,70026 Operating Reserve Fund 4,662,10027 Net annual Balance 12,497,100 (4,728,400) (10,184,800) (12,868,900) (16,485,400)28 End of Year Balance 40,761,800 36,033,400 25,848,600 12,979,700 (3,505,700)29 Days of O&M Cash on Hand 445 342 216 105 (28)

30 Annual Test (c) 1061.1% 1057.5% 1055.2% 1055.1% 1051.3%31 Additional Bonds Test (d) 1046.7% 1046.7% 1046.7% 1046.7% 1046.7%

(a) The Three-Mill Ad Valorem Tax will expire at the end of 2017.(b)

(c)(d)

The General Bond Resolution requires Nine-Mill Ad Valorem Tax Revenue to equal or exceed 100% of annual debt service.The General Bond Resolution requires Nine-Mill Ad Valorem Tax Revenue to equal or exceed 133% of maximum annual debt service.

Reflects beginning of year balance in unrestricted and undesignated cash and cash equivalents and cash and cash equivalents designated for capital projects, less operating reserve requirement.


BLACK & VEATCH | Appendix 87

Appendix Assessment of East Bank Sewage Stations

DATEFACILITYNAME ROUTE LOCATION STATUS

1 06/06/16 Chickasaw AChickasawatMetropolitan

2pumpstotal;1operational.

2 06/06/16 K‐Mart A DesireatGentilly 2pumpstotal;bothoperational.

3 06/06/16 Station23 A 4500Mithra3pumpstotal,1portablepumpoutside;2operational,Pump1outofservice.

4 06/06/16 Station17 A4975SpainatSelma

2pumpstotal;bothoperational.

5 06/06/16 Station22 A 5705Perlita 2pumpstotal;bothoperational.

6 06/06/16 Station19 A3730JumonvilleatMilton


7 06/06/16 Station21 A6670MemphisAtFilmore


8 06/06/16 Station18 AVicksburgatFlorida


9 06/06/16 CityPark A5701MarconiDrive


10 06/07/16 Station20 A 32837thStreet 2pumpstotal;bothoperational.

11 06/07/16 Station4 A5899FleurdeLeis


12 06/07/16LakewoodSouth

ACountryClubDrivenearMarconi


13 06/07/16 Station6 A242SSolomonatPalmyra

Stationbeingrebuilt.1pumptotal;portablepumpoutsideoperational.

14 06/07/16 Station3 A8720OlivenearEagle


15 06/07/16 Station1 A 7336Cohn 2pumpstotal;bothoperational.

16 06/07/16 Station14 A 4000Clara2primarypumpstotal;bothoperational,temppumponsitenotinservice.


88 OCTOBER 2016


17 06/07/16 Station5 A 3912EratoSt 2pumpstotal;bothoperational.

18 06/07/16 Station15 A2431PalmyranearRocheblave

3pumps;alloperational.

19 06/07/16 Station8 ACornerofNBroadandToulouse


20 06/25/15 Station9 A2540AnnetteatLaw


21 06/06/16 Station16 B3751NMiroatPauline


22 06/06/16 Station24 B5027NTontiatForstall


23 06/06/16 Station25 B 2245Charbonnet 2pumpstotal;1operational.

24 06/06/16 Station26 B2244StMauriceatTonti


25 06/06/16 StationB B4725StClaudeAvenue


26 06/06/16SouthernScrap

BSouthernScrapRd


27 06/06/16France&Florida

B HarborRd 2pumpstotal;bothoperational.

28 06/06/16 MECO B2701FranceRoad


29 06/06/16 AmericanMarine

B3855FranceRoad


30 06/06/16VictoriaatGentilly

B 3620Victoria 2pumpstotal;bothoperational.

31 06/06/16 Dodt B8118ChefMenteurHighway

Stationbeingre‐built.One(1)pumptotal;portablepumpoutsideoperational

32 06/06/16PlumOrchi

dB

7300ChefMenteurHighway

Stationbeingrebuilt.1pumptotal;portablepumpoutsideoperational

33 06/06/16 Wilson B7709WilsonAvenue





34 06/06/16 Crowder B5500CrowderRoad


35 06/06/16CastleManor

B4950GawainatDwyer


36 06/06/16 Cerise B 5001Cerise 2pumpstotal;1operational.

37 06/06/16LakewoodTerrace

B5057WarrenDrive


38 06/06/16 McCoy B McCoyatGentilly 2pumpstotal;bothoperational.

39 06/06/16 Amid B6800AlmonasterRoad


40 06/06/16LakeForest

B10451LakeForestBlvd

Stationnewlyrebuilt,butnotyetturnedovertoS&WB.2pumpstotal;bothoperational.

41 06/06/16WrightRoad

BWrightRoadatLakeForest


42 06/06/16 Bullard B5501BullardRoad


43 06/06/16PinesVillage

B6155DwyerRoadatFoch


44 06/06/16 America B6789DwyerRoadatWestlake


45 06/06/16 StationA B1321OrleansAvenue


46 06/07/16Shorewoo

dC

14441MorrisonRoad


47 06/07/16 Briarwood C13701MorrisonRoad


48 06/07/16 Liggett C12501MorrisonRoad


49 06/07/16 Berg C11501MorrisonRoad


50 06/07/16 Weber C10141MorrisonRoad


51 06/07/16 Burke C 9001Morrison 2pumpstotal;bothoperational.


90 OCTOBER 2016


Road

52 06/07/16 Lawrence C7900MorrisonRoad


53 06/07/16 Lamb C6450MorrisonRoad


54 06/07/16GentillyOaks

C5000PapaniaRoadatVienna

2pumpstotal;1operational.Pump2notworking.

55 06/07/16 Eastover C6051EastoverDrive


56 06/07/16 ParisRoad CDwyerWestofParisRoad


57 06/07/16VenetianIsles2

C20711OldSpanishTrail


58 06/07/16IndustrialParkway

C4200IndustrialParkway


59 06/07/16 BlvdX C4433ChefMenteurHighway

2primarypumpsnotoperationalandbeingrebuilt,2temporarypumpsoperational.

60 06/07/16AlceeFortier

CAlceeFortierBlvdattheLevee


61 06/07/16WillowBrook

CWillowbrookoffofMichoud


62 06/07/16 OakIsland C14201MichoudBlvd


63 06/07/16VillagedeLest

C 11324Dwyer2pumpstotal;1operational.Pump2notworking.

64 06/07/16 Michoud C4400MichoudBlvd


65 06/07/16 Folgers C14601GentillyBlvd




Assessment of West Bank Sewage Stations

DATE FACILITYNAME LOCATION STATUS

1 06/08/16 Memorial 2501MemorialParkDr 2pumpstotal;bothoperational.

2 06/08/16 GardenOaks 3201MemorialParkDr 2pumpstotal;1pumpoperational.

3 06/08/16 ParkTimbers 4100LennoxBlvd 2pumpstotal;bothoperational.

4 06/08/16 TallTimbers 3800TallPinesDr 2pumpstotal;bothoperational.

5 06/08/16 ForestIsle 5631WestForestParkDr 2pumpstotal;bothoperational.

6 06/08/16 Blair 3800BlairSt 2pumpstotal;bothoperational.

7 06/08/16 Aurora 6000CarlisleCt 2pumpstotal;bothoperational.

8 06/08/16 EnglishTurnI 2201StantonRd 2pumpstotal;bothoperational.

9 06/08/16 EnglishTurnII 123½OakAlley 2pumpstotal;bothoperational.

10 06/08/16 EnglishTurnIII 2pumpstotal;bothoperational.

11 06/08/16 LowerCoast 3700OldWoodland 2pumpstotal;bothoperational.

12 06/08/16 Woodland 4150WoodlandDr 2pumpstotal;bothoperational.

13 06/08/16 Eton 3440EtonSt 2pumpstotal;bothoperational.

14 06/08/16 Huntlee 3201HuntleeDr 2pumpstotal;1pumpoperational.

15 06/08/16 Holiday 2799HolidayDr 2pumpstotal;bothoperational.

16 06/08/16 BridgePlaza 2914VespasianSt 2pumpstotal;bothoperational.

17 06/08/16 Horace 3301LawrenceSt 2pumpstotal;bothoperational.

Assessment of East Bank Drainage Stations

DATEFACILITYNAME LOCATION STATUS NOTES

1

06/06/16 Station1 2501S.BroadSt

11pumpstotal;10operational,No.1constantdutypumpnotinservice.

2

06/06/16 Station 6 345 Orpheum

Fourteen (14) pumps

total; eleven (11)

pumps operational, 2

constant duty pumps

and pump I out of

service


92 OCTOBER 2016


3

06/08/16 I‐10

Station I‐10 Service Road

Four (4) pumps total;

four (4) pumps

operational

Four (4) vertical pumps

one (1) of which is a

constant duty pump

4

06/06/16 Station75741OrleansAveatMarconiDr

5pumpstotal;4pumpsoperational.

PumpCisoutofserviceduetoelectricalissues.

506/08/16 CanalBlvd 5500CanalBlvd

3pumpstotal;alloperational.

606/06/16 Station2 444N.BroadSt


Nochangefrompreviousyear.

7

06/06/16 Station3 2251NBroadSt9pumpstotal;4pumpsoutofservice.

Constantdutypumps1,2,3&4areoutofservice.

806/08/16 Pritchard 2901Monticello

3pumpstotal;allinservice.


906/08/16 Oleander 9400Oleander

3pumpstotal;3inservice.


1006/06/16 Station4

5700WarringtonDr


11

06/08/16 Station12

RobertELeeandPonchartrainBlvd

1pumptotal,1inservice.


1206/07/16 Station16

DanubeRdatWales



1306/07/16 Station10



1406/07/16 Station14

OneidaatHaynes


15

06/07/16 GrantGrantStatGentillyBlvd

6pumpstotal;5inservice.

2pumpsinside,bothoperational;4pumpsoutside,3operational.Nochangefrompreviousyear.




16 06/07/16 Elaine 2pumpstotal;bothoperational.


17

06/06/16 Station172801FloridaAve


2drainagepumpsoperatingononemotor.3sewagepumpsalsoatthisfacility;alloperational.Nochangefrompreviousyear.

19

06/07/16 Station5 FloridaAve8pumpstotal;alloperational.

6pumpsatoldstation,2pumpsatnewstation.Nochangefrompreviousyear.

2006/07/16 Station19

4500FloridaAve



21

06/07/16 Station206300IntercostalWaterwayatTerminalRd

2pumpstotal;1operational,1outofservice.

Pump1outofservice.Nochangefrompreviousyear.

2206/07/16 Station15

IndustrialParkway



2306/07/16 Dwyer 5801DwyerRd



2406/07/16 Maxent AlceeFortier



Assessment of West Bank Drainage Stations


1

06/03/16 Station115301EastSixthSt

5pumpstotal;4pumpsoperational.

Stationshas4majorpumpsand1constantdutypump,1majorpumpoutofservicebeingrebuiltwithnodateforcompletionofrepair.Nochangefrompreviousyear.

206/03/16 Station13

4201TallSpruceDr

7pumpstotal;allinservice


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Final 2015 Report on Operations - Levees.Org · 2017. 8. 20. · BLACK & VEATCH PROJECT NO. 192043...

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