Consolidation of the Murrieta California Water District into the Western Municipal Water District

1. Consolidation of the Murrieta California Water District into the Western Municipal Water District November 2005

2. Outline • Background on Western & MCWD • Why Consider a Merger? • The Process • The Merger Analysis • Lessons Learned

3. Western Municipal Water District

5. Why Merge? • Possible Reasons to Merge • Larger District better able to solve complex problems • Water Supply & Wastewater Collection • Rapid Growth, Aging Facilities • Possibly Better Service for Those Customers in Murrieta • Allows MCWD & WMWD to lower overhead costs to retail customers

6. Process • Western Requested to Consider Merger by Murrieta County Water District • Formed Joint District Ad Hoc Committee • 2 Directors & GM from Each Agency • Formed a Public Blue Ribbon Committee • Selected 6 Citizens from the Community • Included to 2 Directors & GM’s

7. Process • Developed an Agreement between District’s • Filed an Application with LAFCO • Proposed methods to deal with: • Operation/Overhead Costs • Employees • Service Agreements w/ Other Agencies • Existing MCWD Board • Proposed Merge Date – 12/1/05

8. Merger Analysis • Hired Consultants in Different Disciplines • Water Supply • Operations • Water & Sewer Masterplanning • Water Quality • Operations • CFD Financing • Finances

9. Financial Impacts • Labor Resources • 16 employees w/ 9 in Office • Overhead Savings • GM, AGM, Fin. Mgr., Attorney, Auditor, Office, • Approximately $1,000,000 over 5 Years • Invest Savings in Needed Capital Facilities • Reduced Risk of Lack of Water Supply • Reduced Costs to All Retail Customers

10. Lessons Learned • Two Previous Merge Attempts Failed • Differences: • Motivation - Water Supply Peril • Support - Elected Officials Solidly Behind Merger • Goal – Better Service, Reduce Costs • Larger District able to Secure Water Supplies