I would like this LTE published so that the community can read my side of the story. Also, my position at Wolf Creek Golf Club is not CFO; I am the Controller/HR Director (just being honest).
The article “A Puppet Show” published by the Desert Valley Times on May 20, 2016 contained the following: Before Smith began his presentation, Wolf Creek CFO Kathy Bussman pulled him aside. “I find that very curious,” said Ellestad. “My only question with that is who is the real puppet?”
In response I would like to clarify what took place when I spoke with Bubba Smith prior to his presentation. Earlier in the day Bubba asked our Executive Assistant to enlarge two documents published for the meeting: 1) Virgin Valley Water District Net Revenue Evaluation FY2017 – FY2023 and 2) Debt Reduction Allocation Table. Those documents were scanned documents and of very poor quality. I recreated those documents in Excel so that the presentation documents would be readable. When I recreated the Debt Reduction Allocation Table I discovered the original document had a formula error. That error misstated the Total Amount Outstanding for Bonds and also impacted the % and Allocation of the $10 / EDU.
I did not have an opportunity to speak with Bubba prior to the meeting and felt he needed to know that one of the documents I recreated was different than the original due to a spreadsheet error. I did not want him to show numbers and possibly be challenged that they did not match what was published, and he didn’t know. Therefore, I informed him of the correction I had made. THAT IS WHAT THE CONVERSATION WAS ABOUT! I had absolutely nothing to do with the content of Bubba’s presentation; we never even discussed it. I was hearing it for the first time just like the rest of the people. I find Barbara’s insinuation that I (Wolf Creek) am the puppeteer and Bubba is the puppet very offensive.
If I have something to say I will personally say it – I will not hide behind someone else. I pride myself in being an honest individual who lives my life with the upmost integrity. If Barbara had stayed for the entire meeting she would have seen/heard me give Wes Smith a copy of the incorrect document and explain to him the error. He graciously said he would review it and make any necessary corrections.
NOTE FOR EDITORIAL REVIEW: I have attached the two documents referenced – incorrect version (page 3) which was published with VVWD meeting materials and the version I recreated that was corrected.
Controller – HR Director
Wolf Creek Golf Club
403 Paradise Parkway
Mesquite, NV 89027
Minutes of a Special Budget Meeting
April 7, 2016
Total Expenses including the Normal Operating Expenses (with a 3% annual inflation rate), Debt Service, and Capital Expenditures; the Net Revenue from the difference of the total revenues and total expenses; Use of Cash Reserves; and the Cumulative Excess or (Shortfall). The handout shows a deficit in fiscal years 2017 & 2018, but cash reserves would be used to balance the budgets. Kevin stated that the District is sitting in good shape. Kevin also stated that he would like the board to evaluate and think about small percentage rate hikes in lieu of large 30%, plus, hikes as has been in the past for the District. Kevin wanted the public and business owners to know that the District’s financial position is sound with the projects that are on the books and is in good shape.
Wes began reviewing the financial statement approved for February stating that the District was 66.67% into this fiscal year budget.
Barbara questioned and Wes explained why account 7015-00— Other Income, increased so much from the $5,000 budget amount. Wes stated that the District received interest income from John Lonetti; ftlnds were received from the JM Eagle lawsuit; and money was received from Pool Pact from a theft and vandalism claim at Well #30.
Wes reviewed the February financial statement line by line stating that as of the end of February the District is 1.5 million dollars over budget because revenues are up and the expenses are down.
Wes reviewed the balance sheet and explained what reserve funds would be used to balance out the proposed budget. A total of approximately 6.9 million dollars will be used from the reserve funds to balance the budget.
Wes then began reviewing the Operating Revenues and Non-Operating Revenues in detail.
Wes distributed a table entitled “Debt Reduction Allocation Table”. This table outlines the District’s current bond debt and the related percentage to the total of this debt. It also shows the portion of the $ 10.EDU associated with each bond and the amount to come off of the $ I O.EDU as each bond is paid off; ending the District’s debt in January of 2033. Kevin explained Lease Income, stating that the amount budgeted was based on the current leases with the golf courses, which leases don’t expire until 2019, and SNWA. A discussion ensued regarding irrigation share leases and bond money that was spent to purchase these shares.
Wes began going through the Tentative Budget item by item with Barbara stating that the board had already gone item by item at the last budget meeting and wanted this meeting to go over the changes that were made or any changes that needed to be made now; but did not want to go item by item as at the last meeting.
A break was taken at 10:19 and the meeting resumed at 10:29.
Wes distributed paperwork supplied by Bill Mitchell, District’s liability insurance broker.
This paperwork included an insurance quote comparison between the Nevada Pool Pact,
Traveler’s Insurance and Beacon One with total premium quotes of $ 169,009, $141 , 984, and
$ 163,860 respectively; and a Program Comparisons sheet between the Pool Pact and Travelers Insurance. Some of the Pool Pact coverage numbers are also aggregate numbers which covers all entities covered by the Pool. The discussion today is for information only and not for the board
ο o o ο o ο o o ο ο ο o ο ο o
Virgin Valley Water District
September 30, 2015
Debt Reduction Allocation Table
The Water Rate Increase approved by the Board of Directors on February 3, 2015 included a Debt Reduction Fee component of $10,00 / EDU / Month . This Debt Reduction Fee is to be reduced as each of the current Bonds are paid oft The following table shows the current Bond Debt and the related % to the total. It also shows the portion of the $10 / EDU associated with each Bond. As each Bond is paid off, the Debt Reduction Fee will be reduced by the associated amount as shown in the last column of the table. This reduction will happen starting with the monthly ” Billing Read” for the month following the final payoff of each associated Bond.
Please note that the aflocation has been rounded in a couple of cases to the nearest $0.05.
This ta bie reflects the new Bond Payoff Schedule as of the refinancing done in Sept 20.15.
3/25/2016 P:\Debt Reduction Fee\Debt Reduction Fee Allocation Table 9-30-15
“The Water Rate increase approved by the Board of Directors on February 3, 2015 included a Debt Reduction Fee component of $10.00 – EDU / Month. This Debt Reduction Fee is to be reduced as each of the current Bonds are paid off. The following table shows the current Bond Debt and the related % to the total. It also shows the portion of the $10 / EDU associated with each Bond. As each Bond is paid off, the Debt Reduction Fee will be reduced by the associated amount as shown in the last column of the table. This reduction will happen starting with the monthly “”Billing Read”” for the month following the final payoff of each associated Bond.
Please note that the allocation has been rounded in a couple of cases to the nearest $0.05.”
Amount Outstanding % of Allocation
Bond Series Maturity as of 09/30/2015 Total of $ 10 /EDU
2008 G.O. Revenue Bonds March 2018 1,610,000 6.2% $0.62
2014 Med-Term Bonds June 2019 2,385,000 9.1% $0.91
2011 G.O. Revenue Bonds June 2022 2,570,000 9.8% $0.98
2006 Revenue Bonds June 2026 4,362,000 16.7% $1.67
2003 Revenue Bonds June 2028 2,736,791 10.5% $1.05
2015 SRF G.O. Bond January 2033 12,475,500 47.7% $4.77
Total 26,139,291 100.0% $10.00
See Note Below 24,529,291
Report is Understated: 1,610,000
“NOTE: Total shown on spreadsheet “”P:\Debt Reduction Fee\Debt Reduction Fee Allocation Table 9-30-15″”.
– This also impacts the % of Total and Allocation Column results.”
This table reflects the new Bond Payoff Schedule as of the refinancing done in Sept. 2015.
Footnote on report: 3/25/2016 P:\Debt Reduction Fee\Debt Reduction Fee Allocation Table 9-30-15