Capital Improvement Program Overview

CIP Development and Approval Process

DC WASA's capital budget review process begins each year in the spring, as part of both our capital and operating budget review process. This process includes a review of major accomplishments, priorities, status of major projects and emerging regulatory and related issues impacting the capital program. Projections of changes in project lifetime budgets are also included. The review process involves the DC WASA departments with responsibility for managing the capital projects as well as finance and budget staff and executive management. The CIP is integrated into DC WASA's ten-year financial plan. Because of its size, it is the primary driver of DC WASA's projected rate increases over the next ten years.

This review process lasts several months and culminates with the presentation of the updated CIP to DC WASA's Board of Directors' Operations and Finance & Budget Committees (committee minutes and agendas are in the "News & Publications" section of this website) in October. The Committees complete their review from October through December. The operating budgets, capital improvement program, and ten-year financial plan are then forwarded to the full Board for its consideration in January.

After adoption by the Board of Directors, DC WASA is required to submit its annual operating and capital budgets to the Mayor and the District of Columbia Council for its review and comment. Neither, however, has power to change DC WASA's annual budgets; this authority rests solely with the Board of Directors. Final operating and capital budget numbers, along with the capital authority request is forwarded to the District for inclusion in the District of Columbia's budget submission to Congress. DC WASA's request for capital authority is ultimately made to and approved by the U.S. Congress.

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Facilities Master Plan and Other Facilities Planning Tools

The Water Facilities and Sewer Facilities Master Plans provide a twenty-year framework for developing, analyzing and evaluating changes to the CIP and include projects currently in the ten-year CIP as well as proposed projects projected to either be included or begin after completion of the current ten-year planning period. It describes current conditions and presents a vision of the needs for the water and sewer systems and the actions required to meet those needs.

DC WASA has also developed more detailed facilities plans for specific areas including a Biosolids Management Plan for dealing specifically with biosolids issues and Liquid Processing Facilities Plans for use as project planning tools in those areas.

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Disbursements and Project Lifetime Budgets

The CIP is presented on both a project lifetime basis and cash disbursement basis. During the CIP review process, we perform an extensive review of the total project, or "lifetime" budgets, which also reflect historical spending prior to the current ten-year period, projected spending beyond the current ten-year period and project contingencies. Project lifetime budgets are our primary area of focus in budget development. In addition to lifetime budgets, we also develop a cash disbursements forecast. Actual cash disbursements are critical to forecasting the anticipated level of rate increases and the amount and timing of capital financings. While cash disbursements are a function of project lifetime budgets, they reflect a more realistic projection of actual "cash out the door" and take into account historical and projected completion rates.

Changes are made during the CIP review process to some of the project lifetime budgets approved from the previous year due to changes in project scope, engineering cost estimates, site changes or other related issues. The current year's budget document includes a summary of lifetime project budgets by program area for the Board's review, including a comparison with last year's plan. In addition, some projects are either closed or dropped from the CIP. Projects for which all activities have been completed during a given fiscal year are listed as "Closed" during that fiscal year; these same projects are then listed as "Dropped" in the immediately following fiscal year.

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