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VISION

A sustainable utility to deliver safe and affordable water supply through protection of watersheds and

preservation of the environment for Tandag City’s ecological balance.

MISSION

To adequately address the need for potable and affordable water under conditions of efficient and

effective human and natural resource administration by increasing capability to develop and maintain the

ecology relative to global mitigation of climate change.

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CORE VALUES

Goal 1 - To maintain and upgrade the water supply system and facilities.

Goal 2 - To improve the quality and reliability of water supply through maintaining

Goal 3 - To provide high quality customer service.

Goal 4 - To strengthen the human resource administration, thereby increasing productivity, employee retention and morale.

Goal 5. To improve the linkages and networking within the organization.

STRATEGIC DIRECTION

To maintain and upgrade the water supply system and facilities.

To improve the quality and reliability of water supply through maintaining the responsible stewardship of water sources' forest cover.

To provide high quality customer service.

To strengthen the human resource administration, thereby increasing productivity, employee retention and morale.

To improve the linkages and networking within the organization.

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SIGNIFICANT FIGURES

1,259,301 cu.m - of water produced

1,133,916 cu.m - consumed by customers

19% - non-revenue water

302 - new service connections

5,879 - active connections

6,777 - total services

77 - bacteria-free water samples

47,439 - population served

1244m - new pipelines laid

7.0 has - adopted within the watershed areas

4,375 - seedlings planted within the adopted areas

50% - of permanent employee attended seminars and trainings

33 - approved resolutions

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Table of Contents

Messages 4

Significant Figures 6

Resource Management 7

2013 Activities 8

Customer Service & Satisfaction 11

Infrastructure Development 15

Environmental Protection 17

The Policy Makers 18

Financial Highlights 20

Pictorials 23

Appendices 24

Acknowledgment 25

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Message from the BOD Chairman

The District is dedicated to providing its customers with excellent, reliable service and high quality water year round for many years to come. We do this by improving and maintaining our system of infrastructure proactively, protecting the ecosystem that provides our water supply, and operating in a fiscally responsible manner to ensure long-term financial stability.

In 2013 we made good progress on improving our client services. We are developing new technologies and systems so we can provide our clients with more personal, flexible and innovative services.

Upholding our commitment to provide quality water supply, we will carry on a path of continues improvement. Working with our board to help shape TWD future is an exciting prospect that will ensure our services remain viable for years to come.

We successfully met many challenges during the year, and we look forward to successfully serving our customers in 2014.

Dir. Rodulfo R. Uy, CE (sgd)

BOD Chairman

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Message from the General Manager

I am pleased to share our 2013 annual report. In the past year, Tandag Water District had another solid performance as it continue to build upon its tradition of providing safe potable water for Tandag City concessionaires.

The years to come will bring more discussion about water supply, water quality and water conveyance. We are addressing these issues and making sure reliability remains integral to our operations.

This financial year we responded successfully to a significant increase in client demand. I am proud that our staff continues to deliver high quality client services and a record number of resolved service requests.

I wish to express my gratitude to our concessionaires who have driven us to constantly improve upon our successes. I would also like to acknowledge the hardworking employees who have brought us to where we are today. It is with these sentiments that I present the details of our accomplishments in this annual report.

ENGR. RUBEN C. ELPA, CE (sgd)

General Manager

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RESOURCE MANAGEMENT

Human Resource Development

TWD Human Resource ultimate objective is to maintain a fair, equitable and positive work environment for all employees, in support of the mission of the organization. It is based upon this belief that the success of any organization, and its ultimate value, is primarily dependent upon its people; and that the development of the greatest potential for each employee will create job satisfaction and career opportunities for individuals and provide maximum benefit to the organization.

Hence, the application for the Recategorization from Medium WD to Category C WD conforming the Local Water District-Manual on Categorization, Recategorization and Other Matters (LWD-MaCRO) was formalized. After thorough deliberation, DBM has finally approved on 13 March 2013 the new TWD OSSP and POP. This is now comprised of two divisions, the Administrative & General Services, Finance and Commercial Division and Engineering & Production, Water Quality and Watershed Management Division. Each division carries with it two sections. Overall, the new OSSP has forty-six total (46) plantilla positions labeled as reallocation, reclassified and newly created. Consequently, the new set-up is clearer and more defined as compared to previous structure.

As of 31 December, TWD overall manpower was summed up to ninety nine (99) personnel, broken down as follows:

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16 61

TWD Personnel

Permanent Contract of Services Job Order

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Trainings and Seminars

TWD provides employees with the tools and trainings, and knowledge that will motivate them to perform in the most effective and efficient manner. In 2013, fifteen (15) employees have attended different seminars designed to upgrade their level of competencies and develop their skills. The District was able to dispense a total of One Hundred Eight Thousand Seventy Two Pesos (P108,072.00) in support to the said program.

On the average, fifty percent (50%) of the permanent employees have attended trainings and seminars during the year.

Annual Physical Examination

TWD administered an Annual Physical Examination for its 22 permanent employees through Value Care’s Health Insurance. Everyone was encouraged to take advantage of this facility and in fact they were provided a free transportation to Davao City for a more thorough general physical check up. As a result, some of the district’s employees were advised to take some rest due to illness while others were chosen for possible job-redirection.

2013 Actvivities

Annual Outing / Educational Tour

To foster awareness of the team spirit, to reinforce commitment to the teams shared goals and objectives and to develop strong interpersonal relationships which helped bond the team closer together are rationale of the Annual Outing / Educational Tour. Thus, employees enjoyed this opportunity at Manolo Fortich, Bukidnon on May 18 & 19.

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The Manolo Fortich Water District (MFWD) staffs headed by their supportive General Manager Engr. Rogelio K. Pangan showed great hospitality especially when they escorted TWD staffs at the Dahilayan Forest Park, a tourist destination that offers an array of a fun-filled day activities. Amidst a cool and foggy weather, some experienced the thrill of their lives when they braved the Asia’s Longest Dual Zipline. Others were satisfied with horseback riding and mountain luge ride.

On its second day, MFWD welcomed a site visit in their district water facilities.

Family Day

Family Day is another annual activity to enhance the level of interaction among TWD staff members. In 2013, family day was held at Bugsay Resort and Convention Center in Balibadon, Cortes, Surigao del Sur on 04-05 October. Employees were entertained with games, videoke and buffet foods. They also enjoyed the environmental surrounding of the beachside. The event promotes teamwork and improves friendships.

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Community Outreach Program

As planned to continue the District’s community outreach program, TWD once again takes part of the Department of Education’s “Brigada Eskwela” on 25 May 2013. The lucky recipient was the Brgy. Awasian Elementary School in Brgy. Awasian, Tandag City.

Corporate Social Responsibility

TWD recognizes that it is part of a bigger community and that it has a responsibility to give something in return as a way of expressing gratitude for the successes it has achieved. That is why on 08 November 2013, when the most powerful tropical cyclone of the year – Super typhoon Yolanda hit the Philippines and barreled through most of the Visayas, leaving a trail of devastation in its wake, TWD in its humblest efforts, helped affected communities recover from the ravages of the disaster by packing and sending a total of 300 bags of rice, noodles and sardines to the affected areas through the help of PDRMC Office in Tandag City.

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Customer Service and Satisfaction

Over the years TWD continually develop the elements to achieving customer satisfaction by ensuring prompt responsiveness to customer enquiries and complaints. One of these improvements is the new monthly reading and billing schedule which was formulated to conform to the increasing number of concessionaires. The new reading and billing is done every 1st to the 15th day of every month while the collection period is scheduled every 16th to 29th day of the same month. This applies to all concessionaires which are now divided into 25 zones. Each customer is given fifteen (15) days from the billing date to settle their due amount of which a penalty of 10% of the current bill is added if payment is made after the due date. Service may be discontinued without further notice if payment is not received within five (5) days after due date.

Water Quality Monitoring

TWD always ensures that the water it delivers to customers is safe and compliant with the national standards for drinking water. This is done through a year-round program on water quality control and assurance monitoring.

To make it possible, a predetermined number of water samples are collected every month in identified sampling points consisting of all the production wells, reservoirs and selected representative consumers’ taps. These examples are then brought and examined at the San Francisco Water District laboratory for the determination of total fecal coliform.

In 2013, a total of 77 or an average of 6 per month water samples were collected and determined to be bacteria-free.

Water Rates

There has been no increase of water rates for the year 2013. Water rates schedule which was approved pursuant to LWUA BOT Resolution No. 229, Series of 2006 and TWD BOD Resolution No. 35, Series of 2006 is still the prevailing rate till date.

Negotiation for the approval of the water rate increase is still ongoing with LWUA office in Manila. A Public Hearing was successfully conducted on 06 July 2013 at the Tandag Gymnasium as another pace of compliance to the requirements set by LWUA. This was attended by three (3) of their representatives namely Rafael H. Francisco, TWD Management Advisor; Fe S. Etrata, from LWUA Finance Division and Liezel T. Zabalo, Senior Loans Analyst. The Board of Directors, General Manager Ruben C. Elpa along with other TWD employees were also present during the public hearing.

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Water Sales Collection

Collection drive is the strategy used to generate sales. This includes a 10% surcharge of the bill per month applicable to the delinquent water concessionaires. As the year ended, penalty charges have reached to P1,300,031.31 against the projected target of P1,375,610.00. Total water sales collection for 2013 is P30,437,528.64 or 93% collection efficiency and 92% collection ratio.

Billing and Collection Data

For the Year 2013

BILLING

a. Current (Metered) 31,462,947.15

b. Current (Flat Rate)

c. Penalty Charges 1,300,031.31

TOTAL P 32,762,978.46

COLLECTIONS

a. Current Accounts 21,585,689.07

b. Arrears (Current Year) 8,851,839.57

c. Arrears (Previous Years) 2,081,944.29

TOTAL P 32,519,472.93

Collection efficiency is derived from adding the Current Accounts and Arrears for the current year over the total collection for the year and multiplied by 100 which resulted to 93%.

COLLECTION EFFICIENCY, YTD

21,585,689.07 + 8,851,839.57 X 100 = 93%

32,762,978.46

Collection Ratio is derived from the Total Collection for the year over the Accounts Receivable for 2012 and Total Billed for the year multiplied by 100 which resulted to 92%.

COLLECTION RATIO, YTD 32,519,472.93

X 100 = 92% 2,766,135.04 + 32,762,978.46

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Service Connection Data

The number of service connections is rapidly increasing year after year. From 6,475 in 2012, total services swiftly increased to 6,777 by the end of year 2013. Totaling a new service connections of 302 which exceeded the projected of 220. It can be categorized as follows:

Management’s implementation of the policy in collection procedures produced the disconnection of 22 concessionaires who’s having P500.00 and above arrears. Total service connection was 6,777 of which 5,879 were active and metered, 5,811 billed and 898 inactive connections. Overall, 47,439 of population were served in the locality.

272

0 7 0 23

Service Connection Data

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The Commercial Section thru its Billing Adjustment Memo (BAM) also cited that a total of 5,472 customer’s complaints were entertained and resolved, mentioned as follows:

Conduct of Customer Orientation

Since May 09, 2012, customer orientation had been organized into a formal session conducted every Wednesday. Attendance in the said orientation is required for application of new service connection, to maximize customers’ awareness of TWD policies. The orientation covers brief history of Tandag Water District, steps in applying for new water service connection, water meter structure, reading and billing schedule, reading of water bill, service request flow, how to save water and the water sources. A total of 392 individuals have successfully attended to 47 orientations for the year 2013.

198

525 292

418

31 92 178 249 200

2201

154 135

799

Acted Service Requests

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Active Leak Detection

TWD is regularly conducting a water meter calibration for active consumers that already existed for three years to monitor possible leakages that may arise due to bursts or drops in pressure. Water meters are repainted on color-coded basis to easily identify at what period it has been calibrated. In 2013, a total of 1,988 water meters were calibrated, of which 1,541 have passed and 447 were found defective and were replaced. Calibrated meters are projected to be efficient for another three years.

Passed

Defective

1541

447

Active Leak Detection

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INFRASTRUCTURE DEVELOPMENT

The Engineering Section primary function is to plan and review the new water system facility construction, inspection of water system facilities, trouble shooting water treatment and distribution problems, investigating complaints and collecting and analyzing samples to determine water quality, ensuring that water systems provide adequate quantities of safe, palatable water.

The TWD Multi-Use Building

The Multi-Use Building is another milestone of TWD’s major accomplishment. As TWD family is inevitably growing hence the need to a more conducive workstation for every employee. The Multi-Use Building will be stationed by the Engineering Department and warehouse of office supplies and equipments. By the end of 2013, a total amount of P3,821,248.31 was utilized or 71% of the building was completed. It is set to be fully operational by May of 2014.

Development of the New Sources

TWD is committed to provide potable water to the people of Tandag City hence exploratory drillings are being conducted to all areas with possible water sources. A total of P2,253,741.31 was dispensed for the year 2013.

Exploratory Drilling 1 at Brgy. Awasian

Exploratory Drilling 2 at Brgy. Rosario

Exploratory Drilling 3 at Brgy. Awasian

Exploratory Drilling 4 at Brgy. Awasian

Productive Drilling at Brgy. Awasian

Installation of Main Pipeline at Tabon-Tabon, Quezon Pumping Station II

Pipeline Extension

The vastness of TWD’s service area makes it quite challenging to provide 24/7 water service to the population. This is aggravated by a fast growing population that increased from year to year. Thus, TWD pursued pipeline extensions to improve its services to the increasing number of concessionaires. A total amount of P477,000.00 for 1244 meters in length of distribution and transmission lines were laid and extended in different parts of the District area coverage in Tandag City. Extension of these pipelines has serviced and made residents of said area availed of potable water.

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Pipelines Type Size Length (m) Location

Mainline uPVC pipe 6 ø x 6 ø 144 m SSDSU

Mainline uPVC pipe 3" øx6.0 m 500 m San Agustin Norte

Distribution PE tubing 1 ½" ø 120 m Brgy. Awasian

Distribution uPVC pipe 3" øx6.0 m 480 m Prk. Maganda, Rosario

Mainline Repair and Replacement

The district’s mainline replacement program seeks to replace old and dilapidated pipelines in identified areas of the network purposely to eliminate persistent leaks and improve services.

In order for the District to be always of service, continuous rehabilitation and maintenance works were conducted. A total amount of P632,588.45 for the below series of activities that are continually done to sustain the District’s operation:

Replacement of distribution line 2 ½ ø at Brgy. Pangi, Tandag City;

Rehabilitation and repainting of Brgy. Buenavista Pumping Station and Reservoir;

Rehabilitation and repainting of Brgy. Quezon Pumping Station I;

Rehabilitation and repainting of Brgy. Bioto Reservoir

Repainting of transmission at San Agustin Sur Bridge Crossing

Repainting of transmission line at Telaje Bridge Crossing

Repainting of elevated steel tank at Balilahan, Brgy. Mabua, Tandag City

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ENVIRONMENTAL PROTECTION

Reforestation

Various activities are carried out periodically including the rehabilitation of denuded regions through tree planting, protection against illegal cutting of trees, timber poaching and reverting to its original stability are among TWD’s major concern. The following are the key activities done to materialize this agenda.

10 hectares reforestation project at Ihawan Spring Community Watershed

Planting of 100 pieces giant bamboo at mainstream of Ihawan Source

Construction of Gabions wire mesh 20 meters at upstream of Mangyan Source

Fertilizer application of 950 mixed fruit trees

Brushing / weeding of planted fruit trees at Awasian reservoir and Ihawan Watershed

World Water Day

TWD celebrates World Water Day every 22nd of March. During this year, the District conducted the tree planting activity at downstream of Ihawan Creek with a theme “Tubig para sa lahat, lahat para sa tubig”. Rehabilitation of denuded watershed is the primary motivation to tree planting activity.

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Acquisition of CSC Rights

There was only one recipient of CSC holder paid for 2013.

Name CSC No. Area Location Amount

Jorge & Juanito Cornejo

11-1A05695 2.25 has. Upstream of Mangyan Creek, Brgy. Pandanon

P297,825.00

The Policy Makers

BOD Activities

The Policy Makers is composed of five (5) Boards of Director (BOD) namely Dir. Rodulfo R. Uy, CE, Dir Walderico R. Bonifacio, Dir. Ma. Cleofe P. Pimentel, Dir. Annie O. Ty and Dir. Winifreda A. Damiao. Among other activities, BOD have attended the 34TH PAWD National Convention @ Crowne Plaza Galleria, Manila and World Water Day Celebration (Water Districts in Northern Mindanao) at Bislig City.

Resolutions Approved

A total of 33 Resolutions were approved in 2013. Below are some of the highlights:

Amending Resolution No.14, S.2012 and approving the Organizational Structure Staffing Pattern (OSSP) of Tandag Water District per Model Category C of the LWD-MaCRO.

Approving the appropriation of funds from the PhP7,175,480.00 loan-grant from LWUA’s Non-LWUA Initiated Funds (NLIF) for the installation of pipelines from Brgy. Quezon pumping station II to Brgy. Bioto reservoir;

Requesting the Local Water Utilities Administration (LWUA) to donate to Tandag Water District (TWD) its drilling equipment abandoned at Cantilan Water District;

Requesting the Local Water Utilities Administration to grant Tandag Water District PhP20.0 Million Pesos for construction of a water supply system at Twin Linungaw Park, a tourist destination in Tandag City;

Approving the release of One Hundred Eight Thousand Nine Hundred Seventy Seven Pesos for the 50% 13TH Month Pay and Cash Gift of Sixteen (16) Contractual Employees;

Approving the proposed water rates of Tandag Water District;

Approving the cash flow projections submitted to the Local Water Utilities

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Administration’s Loans and Water Rates Evaluation Division for water rates approval;

To commit and adopt the water rates as presented in the public hearing;

To commit and adopt the Automatic Cost Adjustment Formula as presented in the public hearing;

Accepting the loan terms of the P21.798 Million Financial Assistance under the 2009-DPWH;

Committing to implement the TWD’s CAPEX as reflected in the 5-Year Cash Flow Projection for the period 2013-2017

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Financial Highlights

The Financial condition of TWD for Calendar Year 2013.

2012 2013Increase /

(Decrease)

Rate Increase /

(Decrease)

Total Assets 73,800,635.15 73,711,326.25 -89,308.90 -0.12%

Total Liabilities 44,563,873.44 40,815,940.73 -3,747,932.71 -8.41%

Total Equity 29,236,761.71 32,895,385.52 3,658,623.81 12.51%

Total Income 37,707,833.25 33,912,915.13 -3,794,918.12 -10.06%

Total Expenses 29,294,259.07 29,095,420.69 -198,838.38 -0.68%

Net Income from

Operations8,413,574.18 4,817,494.44 -3,596,079.74 -42.74%

The overall financial performance may be further analyzed as follows:

A. Measures of Profitability

Water Sales Operating Expenses Operating Ratio

2013 31,802,439.62 26,098,253.00 1:0.82

2012 28,708,692.75 26,090,757.09 1:0.91

B. Measures of Liquidity

Current Assets Current Liabilities Current Ratio

2013 20,075,128.02 5,568,741.88 3.60:1

2012 20,075,128.02 5,445,385.67 3.68:1

Figures of Current Ratio explain the ability of TWD to pay short-term debt obligations. The 2013 operation has a healthier financial status showing a Current Ratio of 3.60:1 as compared in 2012. It implies that the District cash and liquid assets can cover three times more than its short-term liabilities.

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Assets

ASSETS

Current Assets

Cash

Cash - Collecting Officers P 136,623.57

Cash in Bank - Local Currency, Current Acct. 6,898,571.48

Cash in Bank - Local Currency, Time Deposits 4,490,392.79

Total 11,525,587.84

Receivable Accounts

Accounts Receivable 2,815,321.26

Allowance for Doubtful Accounts (458,139.25)

Accounts Receivable - Net 2,357,182.01

Installment Sales Receivable 383,246.87

Total 2,740,428.88

Other Receivables

Advances to Officers & Employees 44,283.10

Accounts Receivable - SMLP 68,578.28

Accounts Receivable - SPCLP 68,484.71

Total 181,346.09

Inventories

Office Supplies Inventory 2,319,649.73

Fuel, Oil & Lubricants Inventory 8,240.94

Total 2,327,890.67

Total Current Assets P 16,775,253.48

Non-Current Assets

Property, Plant and Equipment 107,563,654.24

Accumulated Depreciation 50,627,581.47

Total Non-Current Assets P 56,936,072.77

P 73,711,326.25 TOTAL ASSETS

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Liabilities and Equity

LIABILITIES AND EQUITY

Current Liabilities

Inter-Agency Payables

Due to BIR P 108,882.20

Due to GSIS 6,178.97

Due to PHILHEALTH 600.00

Total 115,661.17

Other Payabels

Customers' Deposit 294,471.93

Total 294,471.93

Loans Payable

Current Portion of Long-term Debt 5,158,608.78

Total Current Liabilities 5,568,741.88

Non-Current Liabilities

Loans Payable

Loans Payable - IIP 1,198,588.44

Loans Payable (LA#4-2523) 5,800,468.55

Loans Payable (LA#9-0235) 1,091,345.82

Loans Payable - PNB 27,156,796.04

Total Non-Current Liabilities 35,247,198.85

TOTAL LIABILITIES 40,815,940.73

EQUITY

Government Equity 27,484,983.52

Donated Capital (OPIC) 1,269,111.50

Retained Earnings

Prior Years Udjustment (1,158,870.63)

Current Years Operations 4,817,494.44

Operating Reserve 482,666.69

TOTAL EQUITY 32,895,385.52

TOTAL LIABILITIES AND EQUITY 73,711,326.25

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Basis of Preparation

The financial statements were prepared in accordance with generally accepted accounting principles in the Philippines and generated through the Electronic New Government Accounting System (e-NGAS) effective January 1, 2007. The financial statements have been prepared on a historical basis. The financial statements are presented in Philippine peso and all values represent absolute amounts except otherwise indicated.

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Published by Tandag Water District

Ang’s Building, National Highway, Mabua,

Tandag, Surigao del Sur

Tel Nos.: (086)211-3258/211-4600

E-mail address: tandag_water_district@yahoo.com