1. Bond refunding is expected to save $740,000–$750,000 annually. Turlock Irrigation District priced a $109 million bond refunding on October 26 at an all-in true interest cost of 3.863%. Staff reported more than $600 million in orders, allowing them to improve pricing. Projected gross savings are approximately $14 million over the life of the bonds. The transaction is expected to close November 10.
2. Draft 2027 O&M spending rises 2.1%; a previously approved rate increase remains scheduled. The draft operations and maintenance budget reflects a 2.1% year-over-year increase, with labor, medical insurance and materials costs among the drivers. Changes in overhead allocations make one budget line appear to rise more sharply than overall O&M spending. The final 5% increase under the previously approved three-year electric rate schedule is scheduled for 2027. After that increase, the current five-year outlook projects no further base electric rate increase through 2031. That does not mean bills will remain unchanged: the Power Supply Adjustment (PSA) could shift from a credit to a charge. The draft 2027 budget includes an $8.3 million PSA credit to customers. Staff did not include the bond-refunding savings in the draft figures and plans to incorporate them into the proposed budget. Staff plans to bring that budget to the Board for consideration for adoption on November 24.
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