WEBVTT

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 Okay, it is nine o'clock and we have a forms are called to order the public utilities board

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 meeting for the city of Denton for July 12 2021.

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 The first item is presentations from the public is anyone in the audience that wishes to speak?

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 Okay, do we have anybody on the phone?

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 No, chair, there is nobody on the phone for this meeting.

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 Okay, thank you.

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 Then the next item is the consent agenda.

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 Does any board member wish to pull an item from A through I?

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 Okay, Barbara is pulling H and then you have your hand up.

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 Let's see a a C and D and D will be quick questions.

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 Okay.

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 Nothing from Devon.

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 Nothing from Billy.

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 Okay.

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 Is there a motion to approve items B, E, F, G, and I move approval and a second second

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 and been seconded.

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 All in favor.

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 Say aye.

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 Aye.

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 Negative.

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 That carries.

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 Okay.

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 Item A.

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 We have somebody for them.

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 Okay.

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 So I'm gonna ask Brad Watts, he's our superintendent to come up here and respond to you.

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 Morning.

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 So I guess I'm curious, so regarding all the replacement of poles and inspection of poles

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 and such, how often do they need to be inspected and how often might they have any kind of

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 issue?

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 The inspection process can vary from five years, six, seven years, and it's been quite

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 some time since we've actually done a pole inspection and so with my department in engineering,

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 we started a pole inspection process and we really wanted to get a start date.

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 And so we're gonna inspect the entire infrastructure of all our wood poles, concrete poles, and

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 even steel poles.

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 Some utilities might do it, you know, broken up in quarters or however, and that's what

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 our goal will be is after we get all the poles inspected, then we have a starting point and

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 then we will start doing them on a quarterly basis then.

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 What sort of issues might you encounter?

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 The main issues you're gonna find is gonna be ground rot and just the age of the pole.

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 And you know, we've still got some aging poles out there, but the main thing is below ground

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 level and then also you get like just mother nature of lightning strikes that we don't

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 know that's hit the pole and you know might have burned parts of the pole out or something

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 to that effect.

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 Okay.

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 All right.

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 Any other questions?

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 Do we have a motion to approve item A?

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 Move approval.

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 Second.

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 Second.

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 All in favor say aye.

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 Aye.

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 Carries.

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 Item C. That was you two right there.

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 Yes.

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 And Brad will handle this one as well.

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 Okay.

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 Okay so I might have missed it.

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 Maybe I wasn't just didn't understand.

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 So is this to do active maintenance now or is kind of planning for the future for replacing

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 lights on I-35?

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 It's gonna be a little bit of both.

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 The majority though is gonna be the maintenance side of it.

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 Poles getting knocked down, lights going out, and we've actually encountered some theft

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 where they've actually stole the wire out of there.

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 And then part of it, you know, TxDOT's fixing to do another project in Denton and so that

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 could involve some of that and then also we've got the LED light project because the lights

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 that are on 35 now are majority HPS lights and they'll be as we're moving forward, when

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 we have a light go out, we will change it out with an LED and over a process and then

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 get them all changed out.

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 Okay.

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 Thank you.

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 Any other questions?

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 All right.

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 Do we have a motion to approve item C?

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 So moved.

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 And a second?

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 Second.

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 Or a seconded.

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 All in favor say aye.

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 Aye.

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 And that's moved.

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 Item D. Okay.

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 Good morning.

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 It's the Ben show today, sorry.

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 So if I read that right, it looks like the current contract ended two days ago?

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 Is that correct?

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 On the 10th.

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 Yes.

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 So today is the 12th.

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 The 12th.

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 So what does that mean for us right now?

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 Right now it means that basically they're not to be doing any consulting work for us

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 as part of a new permit or a permit for expansion.

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 So how does that impact the city?

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 It does not do anything right now because the permit is in the executive director's

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 office waiting for his signature.

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 It has been remanded back from the SOA, administrative law judge, and we're just waiting for his

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 signature and then that could happen anywhere from two days to about two weeks and then

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 once that happens then there's some stuff on the back end that we're going to need them

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 to do.

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 Okay.

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 To help us along.

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 So right now, I mean, if it could have hit at any other time it might have impacted us

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 a little bit but it's really opportune time right now.

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 Good deal.

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 Thank you.

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 Okay.

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 Thank you.

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 Any other questions?

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 All right.

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 Do we have a motion to approve Item D?

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 So moved.

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 And a second?

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 Second.

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 Thank you, Billy.

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 All in favor say aye.

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 Aye.

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 Opposed?

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 It's approved.

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 Thank you, Brian.

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 Okay, and Item H, that was Barbara.

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 I just had a question, who is currently, who are we dealing with on the banks?

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 Here comes Cassie.

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 Cassie Ogden is coming up, she's the director of finance.

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 Good morning.

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 We're currently using Wells Fargo.

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 That has been our bank for several years now.

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 Okay.

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 It looks like it's a pretty good deal.

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 Yes, we have a good working relationship with Wells Fargo.

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 We haven't had any issues.

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 We did have two other bidders but just really came down to price and probable performance.

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 Right.

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 Okay.

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 Thank you very much.

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 You're welcome.

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 Move approval.

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 And do we have a second?

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 Second.

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 All in favor say aye.

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 Aye.

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 Opposed?

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 That one carries.

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 Next item is consider approval of the June 28th, 2021 minutes.

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 Do we have any changes or corrections to those minutes?

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 No.

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 Do we have a motion to approve?

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 Move approval.

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 Thank you, Billy.

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 And a second?

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 Second.

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 All in favor say aye.

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 Aye.

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 And you weren't here?

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 Yeah.

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 Okay.

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 Thank you.

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 There is two.

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 Items for individual consideration.

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 Consider recommending the adoption of an ORNS for the City of Denton, a Texas Home Rule

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 Municipal Corporation authorizing the city manager or their designee to execute a contract

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 with USIC Locating Services LLC for locating and marking all existing and future installed

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 utility lines for Denton Municipal Electric and the fiber, water, and wastewater departments

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 providing for the expenditure of funds therefore and providing an effective date RFP 7672 awarded

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 to the USIC Locating Services LLC for three years with the option for two additional one-year

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 extensions and the total five-year not to exceed amount of $4,500,000.

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 Okay.

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 I have a little presentation to talk about the underground utility locating and when

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 we first started doing it with contractors it was the electric department only based

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 off of the needs from the electric department and how many and then did it share?

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 Sorry about that, I thought I had it.

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 But now we're involving fiber optics has also been located by a contractor and now water

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 and wastewater will start utilizing a contractor.

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 As you know, in the state of Texas, you know, everybody hears the term, you know, call before

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 you dig.

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 It used to be Dig Test and now it's Texas 811 and Denton County is one of the fastest

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 growing counties in the state of Texas and then many types of the utilities in Denton

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 are, you know, buried underground underneath the streets, roadways, or right-of-ways, sanitary

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 and storm sewers, water, natural gas, oil pipelines, telephone, fiber optic, cable television,

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 traffic signal, electric power, so there's quite a bit of stuff buried in the ground.

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 These things are all protected under federal laws to prevent people from just going out

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 and digging, you know, and damaging or doing a strike on an underground line.

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 Anytime there is a hit on our lines, whether it be water, electric, of an unmarked or improper

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 marked line can result in, you know, serious injury, loss of service to customers, cost

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 of repairs, and loss of revenue, and, you know, until the repairs are made for all utilities

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 affected by an excavation strike.

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 The cost for us to do the city staff to perform a locate is approximately, depending upon

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 the department, it could be $50 to $100 an hour, which includes the labor and the vehicle

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 cost.

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 Depending on the locate also is a factor, you know, when you're doing hourly, paying

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 an employee to do the locate, you know, based on the department performing the locate.

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 And then you've also got costs for the city staff to perform emergency locates after hours,

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 you know, in the event of a, you know, water line or gas line or electric line.

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 After hours we have to call a locate, so do the contractors that are coming out to fix

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 the lines.

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 And then a cost for, this can range anywhere from $100 to $200 an hour, based on the length

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 of the locate and things like that, after hours and over time.

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 Cost for a contractor on the current contract that we're on right now is $12.04 per locate.

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 And then for the fiber locate it's $10.20 per ticket for each locate.

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 And then the locate prices are the same.

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 Due to the high volume of daily locate requests, which it's indenting as we're growing, it's

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 just getting more and more and more.

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 It would require additional staff specifically designated to perform locates should a decision

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 made to revert back to in-house locate services.

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 And on this page, you know, the locate costs, and you'll see a difference in electric locate

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 cost and then a water locate cost.

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 And one of the main reasons is we go all the way up into the meter base in the yard.

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 So the locate has to also do in the street, the right of ways, but also up into the customer's

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 yard for the customer service.

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 Water, you know, they're mainly in the street.

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 Once you leave the meter, then up in the yard, then that becomes the property owner's responsibility.

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 So that's one of the areas that reduces some of the costs for water.

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 And then fiber, they pretty much stay the same throughout there.

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 I mean, the fiber network is what it is.

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 It's not growing as much as the water and electric because, I mean, they have their

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 own little gridded area.

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 And then in locates, you see in 2018, they fluctuate up and down.

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 There's many things that can affect, you know, how many locates you're going to have in a

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 year.

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 What the economy's doing, I'll give you an example as far as when, like, one of the telecommunication

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 companies want to come in, and for example, Viles, when they came in denting with Viles,

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 they were digging in everybody's yard.

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 So our locates just, you know, went through the roof, but then once we got past that,

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 then it went back down.

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 So it can fluctuate up and down.

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 Water stays right there with us pretty close, and then fiber, you know, again, fiber is

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 what it is.

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 They don't have as much.

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 And this is an example.

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 When somebody digs and they don't have locates, this was actually out in front of Bonnebrae

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 substation.

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 This took out three circuits, and so -- and they didn't have proper locates.

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 They had locates, but then when they started excavating, they removed the locates in a

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 new company -- or the same company, I apologize -- the same company came back to work.

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 The lines were moved, or the marks were erased because of digging, and then they actually

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 hit three circuits, so we had a, you know, major outage of three circuits on that side

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 of town.

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 It can be very costly when somebody don't -- when they don't call for locates.

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 And in our direction, you know, we're seeking approval for a contract of underground utility

00:14:04.600 --> 00:14:10.040
 electric -- utility electric and fiber line locating services for the city of Denton and

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 award USIC locating services LSE in a three-year, with the option two additional one-year extensions

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 and the total of a five-year contract not to exceed $4.5 million.

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 And the main reason to try and put this much money on this contract is we don't know what's

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 coming.

00:14:31.760 --> 00:14:35.960
 We know that we've got 100 coal ranches that's going to hit, and when that does, the locates

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 are just going to go crazy for water and electric.

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 And then whatever else is coming down, you know, Denton is the -- it's one of the fastest

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 growing counties in Texas, and we want to be prepared for it.

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 And I'll answer any questions.

00:14:51.360 --> 00:14:52.360
 >> Any questions?

00:14:52.360 --> 00:14:54.760
 Yes, Barbara, go ahead.

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 >> Are they going to go back and start from the beginning to log them?

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 You said some of them were marked properly, so will they be locating?

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 Will this be comprehensive for the city?

00:15:09.160 --> 00:15:12.520
 >> I guess I don't -- I'm not understanding your question.

00:15:12.520 --> 00:15:13.520
 >> Okay.

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 You commented that sometimes they've -- the lines have been improperly located.

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 Are they going to check, go back and check so that we will have, during the course of

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 this contract, all of these things located within our city?

00:15:28.240 --> 00:15:31.680
 >> Well, locates are only -- and I made an improper statement.

00:15:31.680 --> 00:15:33.560
 I think I misled you on that.

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 It wasn't that it was improperly marked.

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 They marked the lines, but then while they were digging with the big excavators, the

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 lines were moved when they took the dirt up, and then it's their responsibility to call

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 us to let us know that we've damaged our -- the locates, we can't see where the lines are,

00:15:52.640 --> 00:15:53.640
 we'll go out.

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 Our -- actually our service trucks and water department also will go out right then and

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 re-mark, if not the contractor, to make sure that the lines are identified and marked.

00:16:04.520 --> 00:16:09.920
 Was that -- I guess I misled -- I said the wrong thing, and I guess that you took that

00:16:09.920 --> 00:16:10.920
 from that.

00:16:10.920 --> 00:16:11.920
 >> Yeah.

00:16:11.920 --> 00:16:17.580
 Barbara, I think what Brad's saying is that when that second crew from that same company,

00:16:17.580 --> 00:16:22.520
 when they came back the next day, they should have called in a line locate, and they didn't.

00:16:22.520 --> 00:16:24.680
 And that's what he meant by not being properly marked.

00:16:24.680 --> 00:16:25.680
 >> Okay.

00:16:25.680 --> 00:16:26.680
 >> Yes, ma'am.

00:16:26.680 --> 00:16:27.680
 >> Okay.

00:16:27.680 --> 00:16:31.900
 So we can re-mark the lines immediately right then.

00:16:31.900 --> 00:16:34.480
 >> And this does not displace any employees.

00:16:34.480 --> 00:16:36.720
 This is because we can't handle the work.

00:16:36.720 --> 00:16:37.720
 >> Correct.

00:16:37.720 --> 00:16:38.720
 >> Okay.

00:16:38.720 --> 00:16:39.720
 Any other questions?

00:16:39.720 --> 00:16:46.280
 >> What liability does the line locate company have for correctly locating these -- any lines

00:16:46.280 --> 00:16:47.280
 that you say about to locate?

00:16:47.280 --> 00:16:51.560
 >> They can be 100% liable if they improperly mark, which, you know, there's clauses in

00:16:51.560 --> 00:16:55.200
 the contract where they can, you know, they can argue it and everything, but they are

00:16:55.200 --> 00:16:56.200
 100% liable.

00:16:56.200 --> 00:16:58.680
 So if they mismark or if they don't mark.

00:16:58.680 --> 00:17:04.320
 So we can't go back to them for, you know, for all costs, the damages and everything.

00:17:04.320 --> 00:17:05.320
 >> Okay.

00:17:05.320 --> 00:17:06.320
 >> Okay.

00:17:06.320 --> 00:17:07.320
 Oh, yes, go ahead, Desmond.

00:17:07.320 --> 00:17:13.520
 >> So I'm noticing in the presentation you had costs for 2020 and number of locates for

00:17:13.520 --> 00:17:14.520
 2020.

00:17:14.520 --> 00:17:22.080
 It looks like it was $460,000 total cost and then about 50 -- a little over 50,000 locates,

00:17:22.080 --> 00:17:23.080
 55,000 locates.

00:17:23.080 --> 00:17:27.080
 So that's like $9 a locate in cost.

00:17:27.080 --> 00:17:32.360
 >> The current contract, we're at $12 and I'm speaking for electric, it's $12.04 and

00:17:32.360 --> 00:17:35.360
 then fiber is $10.85.

00:17:35.360 --> 00:17:39.920
 On the current contract we're in right now, do you have the price for the new contracts?

00:17:39.920 --> 00:17:41.680
 If not, I can give them to you.

00:17:41.680 --> 00:17:47.520
 >> Yeah, they're in here, but I'm just doing that math, it seems like the 2020 actual costs

00:17:47.520 --> 00:17:51.200
 were lower than the proposed contract.

00:17:51.200 --> 00:17:55.280
 And they can fluctuate up and down depending on one of the things that affected some of

00:17:55.280 --> 00:18:00.400
 that would have been COVID because there were contractors that weren't working and then,

00:18:00.400 --> 00:18:09.840
 you know, based off call volume how many people need locates versus, you know, 19, 2020, 2021.

00:18:09.840 --> 00:18:21.160
 >> Yeah, so just looking at just the water, $134,000 for 23,000 locates.

00:18:21.160 --> 00:18:24.200
 So that's $6 a locate that we performed ourselves?

00:18:24.200 --> 00:18:27.920
 >> No, I see there's different parts of the line locate contract.

00:18:27.920 --> 00:18:33.600
 You've got your locate for just a normal locate that you go out and then you have an after

00:18:33.600 --> 00:18:40.400
 hours locate and so that's going to entail all that and then you also have another price

00:18:40.400 --> 00:18:45.600
 that's thrown in there as far as when a locator, they keep having to come back over and over

00:18:45.600 --> 00:18:51.240
 and over and over, they will call that a project rate.

00:18:51.240 --> 00:18:56.200
 Since they're coming back out there so many times, they've moved to a different rate because

00:18:56.200 --> 00:18:59.600
 they're going to spend, you know, three or four hours out there locating something so

00:18:59.600 --> 00:19:03.760
 then they charge us a locate so that it's not broken down but that, you know, that involves

00:19:03.760 --> 00:19:08.320
 all those prices.

00:19:08.320 --> 00:19:10.200
 >> Thank you.

00:19:10.200 --> 00:19:11.200
 >> Any other questions?

00:19:11.200 --> 00:19:17.040
 All right, do we have a motion to approve this item?

00:19:17.040 --> 00:19:19.040
 >> Moved.

00:19:19.040 --> 00:19:21.040
 >> Second.

00:19:21.040 --> 00:19:29.160
 >> Well, actually Ben moved first so Billy, you're the second.

00:19:29.160 --> 00:19:30.440
 All in favor say aye.

00:19:30.440 --> 00:19:31.440
 >> Aye.

00:19:31.440 --> 00:19:32.440
 >> Aye.

00:19:32.440 --> 00:19:33.440
 >> Opposed?

00:19:33.440 --> 00:19:34.440
 Thank you.

00:19:34.440 --> 00:19:35.440
 Thank you.

00:19:35.440 --> 00:19:36.440
 Management reports.

00:19:36.440 --> 00:19:37.440
 Mr. Palenty.

00:19:37.440 --> 00:19:39.720
 >> So Madam Chair, members of the PB.

00:19:39.720 --> 00:19:42.880
 So we have a couple of items here for you.

00:19:42.880 --> 00:19:49.240
 The first one is a memo from our finance department regarding the series 21 utility system revenue

00:19:49.240 --> 00:19:51.040
 refunding bonds.

00:19:51.040 --> 00:19:59.360
 Cassie Ogden is here with us if anyone has any questions on that particular memo.

00:19:59.360 --> 00:20:00.360
 >> Questions from the board?

00:20:00.360 --> 00:20:06.840
 Go ahead, Mr. Taylor.

00:20:06.840 --> 00:20:07.840
 >> So I'm new up here.

00:20:07.840 --> 00:20:09.640
 So I don't know if this has already been covered.

00:20:09.640 --> 00:20:15.400
 I was wondering if we had an idea of what the likely impact will be over the next-- over

00:20:15.400 --> 00:20:17.440
 the 30-year term to rate payers.

00:20:17.440 --> 00:20:19.440
 >> That's a good question.

00:20:19.440 --> 00:20:20.440
 >> Good morning.

00:20:20.440 --> 00:20:28.360
 So we did a presentation at the last PB meeting on the electric performa and the rate impact.

00:20:28.360 --> 00:20:31.520
 Right now we are not projecting to increase rates.

00:20:31.520 --> 00:20:36.880
 That's one of the reasons we wanted to do the refunding and spread that cost over 30

00:20:36.880 --> 00:20:42.000
 years so that it wasn't a one, you know, one hit in one year to the rate payers.

00:20:42.000 --> 00:20:45.240
 But we have a lot of uncertainties right now with the electric fund.

00:20:45.240 --> 00:20:53.540
 We have an outstanding full case rate filing for our transmission cost of revenue which

00:20:53.540 --> 00:20:58.740
 could impact the revenue that we receive on our transmission costs or assets.

00:20:58.740 --> 00:21:03.000
 And then we also have a cost of service study that's currently outstanding.

00:21:03.000 --> 00:21:07.640
 So we didn't want to bring a rate increase forward and then have a cost of service study

00:21:07.640 --> 00:21:11.320
 done that could potentially impact the rates.

00:21:11.320 --> 00:21:16.160
 So we're projecting to bring back rate discussions in December.

00:21:16.160 --> 00:21:17.160
 >> OK.

00:21:17.160 --> 00:21:18.160
 Thank you.

00:21:18.160 --> 00:21:19.160
 >> OK.

00:21:19.160 --> 00:21:25.840
 So the next item that we have here for you is I think it's a follow-up memo from our

00:21:25.840 --> 00:21:30.360
 purchasing compliance area for the north-south main project.

00:21:30.360 --> 00:21:36.220
 It was a tender agreement that Christine Taylor, our director over that area is here if anyone

00:21:36.220 --> 00:21:39.920
 has any questions.

00:21:39.920 --> 00:21:40.920
 >> Questions on the memo?

00:21:40.920 --> 00:21:41.920
 I see none.

00:21:41.920 --> 00:21:42.920
 >> OK.

00:21:42.920 --> 00:21:51.640
 And then the final two items are just our feature agenda items, you know, and Nick will be talking

00:21:51.640 --> 00:21:58.400
 a little bit more again with you about the schedule for the budget and in final approval

00:21:58.400 --> 00:22:04.360
 or recommendation to the council from the board, not just on the budgets for the utilities

00:22:04.360 --> 00:22:10.520
 but also on the individual rate ordinances, those will be coming to you as well.

00:22:10.520 --> 00:22:15.840
 And then the last item is on the new business action items, obviously we still have a couple

00:22:15.840 --> 00:22:21.040
 of items that are still on here, one for solid waste, one for DME.

00:22:21.040 --> 00:22:25.360
 And then as you know, the governor did call it a special session.

00:22:25.360 --> 00:22:30.440
 And even though there was no specific item on his agenda for electric, I can tell you

00:22:30.440 --> 00:22:31.440
 that there is a hearing.

00:22:31.440 --> 00:22:37.720
 I think the hearing is actually today that's being had on various electric-related issues.

00:22:37.720 --> 00:22:41.400
 And so we're going to wait until probably the end of the legislative session to come

00:22:41.400 --> 00:22:47.600
 back to you and kind of give you a synopsis of all the activities and any impacts that

00:22:47.600 --> 00:22:48.880
 we may have on the utilities.

00:22:48.880 --> 00:22:52.760
 But with that, if there's any questions on these items or if there's something else that

00:22:52.760 --> 00:22:55.720
 you'd like to be added on there, just let me know.

00:22:55.720 --> 00:22:56.720
 Okay.

00:22:56.720 --> 00:22:57.720
 Thank you.

00:22:57.720 --> 00:22:58.720
 Yes, Berman.

00:22:58.720 --> 00:23:03.400
 Do we have someone monitoring the bills that might potentially affect?

00:23:03.400 --> 00:23:04.400
 Yes, ma'am.

00:23:04.400 --> 00:23:09.480
 So we have, the city has a contract with two lobbyists, Jackson Walker on the general government

00:23:09.480 --> 00:23:14.280
 side that handles the majority of the city and then we have focus advocacy that handles

00:23:14.280 --> 00:23:16.840
 just DME-related items.

00:23:16.840 --> 00:23:22.640
 And so there's certainly the lobbyists that are keeping in touch with what's going

00:23:22.640 --> 00:23:27.480
 on, but we have a number of different staff members across the city for DME.

00:23:27.480 --> 00:23:33.320
 Terry Nolte has been very active in that area for us and will continue to do that, not just

00:23:33.320 --> 00:23:37.360
 with the legislature, but also with the PUCT and RCOT as well.

00:23:37.360 --> 00:23:38.360
 Thank you.

00:23:38.360 --> 00:23:39.360
 Yes, ma'am.

00:23:39.360 --> 00:23:40.360
 All right.

00:23:40.360 --> 00:23:42.700
 Then we're on to concluding items.

00:23:42.700 --> 00:23:47.880
 This is the opportunity to make any public comments or add something to a future agenda

00:23:47.880 --> 00:23:48.880
 item.

00:23:48.880 --> 00:23:51.920
 Does anybody have something?

00:23:51.920 --> 00:23:56.400
 I'd like to welcome Devin Taylor to the board and maybe just tell us a little bit about

00:23:56.400 --> 00:23:57.400
 yourself.

00:23:57.400 --> 00:23:58.400
 Sure.

00:23:58.400 --> 00:23:59.400
 Thank you.

00:23:59.400 --> 00:24:00.400
 And how you got into this.

00:24:00.400 --> 00:24:03.840
 So I'm Devin Taylor, newly appointed today to the board.

00:24:03.840 --> 00:24:08.120
 I grew up in Denton County and graduated from Ryan High School and raising a family here

00:24:08.120 --> 00:24:15.320
 in Denton and I look forward to serving our community and working with this board toward

00:24:15.320 --> 00:24:19.880
 long-term sustainability, reliability and quality of services as our city continues

00:24:19.880 --> 00:24:21.360
 to grow.

00:24:21.360 --> 00:24:23.920
 And I'm really excited to be here.

00:24:23.920 --> 00:24:24.920
 Welcome.

00:24:24.920 --> 00:24:25.920
 Okay.

00:24:25.920 --> 00:24:28.000
 The last item is our work session.

00:24:28.000 --> 00:24:32.160
 Receive a report and hold a discussion and give staff direction regarding the water,

00:24:32.160 --> 00:24:38.640
 wastewater, drainage, solid waste, electric and customer service fiscal year 2021-2022,

00:24:38.640 --> 00:24:43.400
 preliminary budget capital improvement program and five-year financial forecasts.

00:24:43.400 --> 00:24:46.440
 Good morning, Chair, PB members, Nick Vinson, Assistant Director of Finance.

00:24:46.440 --> 00:24:50.880
 Let me get the presentation pulled up really quick.

00:24:50.880 --> 00:24:51.880
 And welcome, Mr. Taylor.

00:24:51.880 --> 00:24:58.480
 We're definitely excited you're here to talk about the budget with us.

00:24:58.480 --> 00:25:08.640
 All right, before we get started, a brief introduction.

00:25:08.640 --> 00:25:11.360
 So I'm going to walk through the utility budget presentation.

00:25:11.360 --> 00:25:15.560
 After I get done, Crystal Foster, the customer service manager, can present her presentation.

00:25:15.560 --> 00:25:19.760
 So we're definitely excited that she's here with us today to present her budget.

00:25:19.760 --> 00:25:20.760
 She's done a great job.

00:25:20.760 --> 00:25:22.640
 And our staff, this fiscal year, putting it together.

00:25:22.640 --> 00:25:28.960
 So we're excited about that.

00:25:28.960 --> 00:25:32.240
 A little bit of history for the PB members that may not have been here last week, and

00:25:32.240 --> 00:25:35.800
 we did, or I guess it was two weeks ago, we did walk through the preliminary budget for

00:25:35.800 --> 00:25:37.520
 each of the utilities.

00:25:37.520 --> 00:25:41.640
 We looked at the operational information forum, what the goals and accomplishments were for

00:25:41.640 --> 00:25:46.280
 this previous year and this upcoming year, what the forecast looks like from the operational

00:25:46.280 --> 00:25:57.720
 standpoint and the capital standpoint, and then what those future steps are.

00:25:57.720 --> 00:26:01.560
 So the water financial assumptions, what we do, we typically tell the PB and the city

00:26:01.560 --> 00:26:07.440
 council how we do the revenue forecast from a volume standpoint and an expense standpoint.

00:26:07.440 --> 00:26:11.200
 So the volume forecast for the water utility, we currently do have a 2% growth forecast

00:26:11.200 --> 00:26:12.680
 in the out years.

00:26:12.680 --> 00:26:18.240
 We are looking at that 100 coal ranch development that Mr. Watts had mentioned earlier, starting

00:26:18.240 --> 00:26:19.240
 the fiscal year 2023.

00:26:19.240 --> 00:26:25.400
 So these utility performance do include financials from the operating standpoint and revenue standpoint

00:26:25.400 --> 00:26:26.400
 for that development.

00:26:26.400 --> 00:26:32.600
 Revenue is the 2% growth in the forecasted years, consistent with that volume forecast.

00:26:32.600 --> 00:26:37.400
 On the expense side, we currently do have a 3% growth forecast in the out years for expenses.

00:26:37.400 --> 00:26:41.160
 And then supplemental requests, and for any PB members that may not know, supplemental

00:26:41.160 --> 00:26:44.080
 requests are new packages that the utility is requesting.

00:26:44.080 --> 00:26:47.720
 So these could be new people, new initiatives the department wants to accomplish this coming

00:26:47.720 --> 00:26:53.240
 fiscal year, that we do consider those supplemental packages, that we do consider those separately.

00:26:53.240 --> 00:26:58.120
 For the water utilities, these did total $413,000.

00:26:58.120 --> 00:27:04.520
 And then these requests are for increased materials costs, employee licenses, fire hydrant,

00:27:04.520 --> 00:27:10.580
 and line location services.

00:27:10.580 --> 00:27:14.160
 So the water tenure forecast, I know there's a lot of numbers on this page, so I'm going

00:27:14.160 --> 00:27:15.860
 to walk through it fairly slowly.

00:27:15.860 --> 00:27:18.800
 We did walk through it two weeks ago, but I want to make sure all the PB members are

00:27:18.800 --> 00:27:21.260
 familiar with what you're looking at.

00:27:21.260 --> 00:27:23.700
 So what we do is we group the revenues up here at the top.

00:27:23.700 --> 00:27:25.640
 You can see the water revenues.

00:27:25.640 --> 00:27:28.560
 We are currently in fiscal year 2021.

00:27:28.560 --> 00:27:32.920
 And the city's fiscal year does run from October 1st to September 30th of each year.

00:27:32.920 --> 00:27:35.760
 So we are about three quarters the way through the current fiscal year.

00:27:35.760 --> 00:27:39.000
 So we are currently in 2021's fiscal year.

00:27:39.000 --> 00:27:45.160
 You can see we had $49 million in revenues, $52.9 million in expenses.

00:27:45.160 --> 00:27:48.520
 So the adopted budget that was approved by both the PB and City Council this year had

00:27:48.520 --> 00:27:51.680
 use of reserves of $3.9 million.

00:27:51.680 --> 00:27:53.820
 We are forecasting coming a little bit better than that.

00:27:53.820 --> 00:27:59.600
 So you can see our planned revenues of $48.7, with the expenses coming in at $51.5.

00:27:59.600 --> 00:28:04.640
 So actually only using about $2.8 million in reserves.

00:28:04.640 --> 00:28:08.480
 The preliminary budget, or what we're here talking to you today about, is in this column

00:28:08.480 --> 00:28:09.480
 right here.

00:28:09.480 --> 00:28:13.540
 We currently have revenues forecasted at $52.2 million.

00:28:13.540 --> 00:28:14.840
 No planned use of reserves.

00:28:14.840 --> 00:28:20.520
 You can see the use of reserves in this pinkish tin column right here, or this row.

00:28:20.520 --> 00:28:25.840
 Expenses of $51.5, with a surplus or a net income of $686,000.

00:28:25.840 --> 00:28:29.580
 So I did want to walk you down to the bottom of the page a little bit and explain some

00:28:29.580 --> 00:28:31.280
 of these other numbers.

00:28:31.280 --> 00:28:33.920
 You can see the Indian Water Fund balance.

00:28:33.920 --> 00:28:37.340
 So what this fund balance simply is, this is the operating reserve that this fund has

00:28:37.340 --> 00:28:42.020
 on hand in case something was to happen from an operational standpoint or a rate standpoint

00:28:42.020 --> 00:28:44.560
 to help minimize that impact to the rate base.

00:28:44.560 --> 00:28:47.840
 So definitely want to point that out to the PEB members.

00:28:47.840 --> 00:28:52.960
 Ending this upcoming fiscal year, we'd have about $20.2 million in that reserve.

00:28:52.960 --> 00:28:57.680
 The targets, so we do have a target for this utility, the minimum of 120 days, with a maximum

00:28:57.680 --> 00:28:58.680
 of 180 days.

00:28:58.680 --> 00:29:04.600
 So that minimum equates to about $16.5 million, with that maximum being $24.8.

00:29:04.600 --> 00:29:08.720
 A couple other numbers on this page I want to point out to you, the impact fee capital

00:29:08.720 --> 00:29:09.720
 reserve.

00:29:09.720 --> 00:29:13.840
 We currently have $9 million segregated into that account, and we'll talk a little bit

00:29:13.840 --> 00:29:15.720
 about that here in just a second.

00:29:15.720 --> 00:29:19.320
 The impact fee reserve, this is the rest of the impact fee money that's available.

00:29:19.320 --> 00:29:23.480
 If something was to come up with growth and growth was to stop, we can mitigate some of

00:29:23.480 --> 00:29:25.800
 that impact to the rate base.

00:29:25.800 --> 00:29:29.040
 Development plan lines, these are from big developments coming into the community, and

00:29:29.040 --> 00:29:33.480
 we're currently looking at these funds and how we can use these moving forward.

00:29:33.480 --> 00:29:36.640
 So going back up the page here, a couple of things I want to point out to you is when

00:29:36.640 --> 00:29:41.600
 you get out here into the future year, starting in fiscal year 2024 through 2027, you can

00:29:41.600 --> 00:29:48.760
 see we do have the net income, so about $800,000 in 2024, $5.5 million in 2025, and $4 million

00:29:48.760 --> 00:29:52.480
 in '26, and then $1.3 million in '27.

00:29:52.480 --> 00:29:56.400
 So we are working to build up that fund balance as we get out there in the future years, and

00:29:56.400 --> 00:30:01.360
 really ramping up to help offset that cost of that lake expansion that's coming up in

00:30:01.360 --> 00:30:03.640
 2027, 2028.

00:30:03.640 --> 00:30:09.120
 So when you see the increase from 16.5 to 21.3, that is that lake expansion project

00:30:09.120 --> 00:30:11.320
 at Lake Ray Roberts, about $90 million.

00:30:11.320 --> 00:30:14.880
 So our thought process is to ramp up that operating reserve to help offset that debt

00:30:14.880 --> 00:30:17.120
 service.

00:30:17.120 --> 00:30:20.600
 Going back down here to the impact fee capital reserve, that $9 million I pointed out to

00:30:20.600 --> 00:30:23.960
 you earlier, it does go away in 2024.

00:30:23.960 --> 00:30:29.580
 The reason for that is we do plan to cash fund the design of that lake expansion project.

00:30:29.580 --> 00:30:39.400
 So $90 million for construction, about $9 billion for the design of that project.

00:30:39.400 --> 00:30:40.400
 Assumptions for wastewater.

00:30:40.400 --> 00:30:41.560
 I don't have to read each one of these to you.

00:30:41.560 --> 00:30:43.160
 This is basically the same as water.

00:30:43.160 --> 00:30:47.720
 We have the 2% growth forecast on the volume side, the 2% growth forecast on the revenues.

00:30:47.720 --> 00:30:52.840
 Expenses, we have the 3% growth forecast in the out years, and those supplemental packages,

00:30:52.840 --> 00:30:58.120
 those new initiatives this utility is looking to do is about $701,000.

00:30:58.120 --> 00:31:03.000
 Those initiatives do make up of material costs, employee licenses, fire hydrant maintenance,

00:31:03.000 --> 00:31:09.280
 and some line location and street cut dollars.

00:31:09.280 --> 00:31:11.360
 So 10-year forecast for wastewater is very similar.

00:31:11.360 --> 00:31:14.920
 The only differences is mostly just the numbers and the color on the page.

00:31:14.920 --> 00:31:18.660
 So this one is in orange just to make it stand out from water.

00:31:18.660 --> 00:31:23.360
 So in fiscal year 2021, this is the adopted budget that we're currently in right now.

00:31:23.360 --> 00:31:33.120
 You can see 31.2 million or 31.1, 37.1 in revenues, and then 36.9 in expenses, so 292,000

00:31:33.120 --> 00:31:34.120
 positive.

00:31:34.120 --> 00:31:37.920
 So basically, we did have a balanced budget this current fiscal year that we're in.

00:31:37.920 --> 00:31:46.080
 Ending this year, you can see we have 37.1 in revenues, 36.4 in expenses, about $700,000

00:31:46.080 --> 00:31:47.760
 positive in net income.

00:31:47.760 --> 00:31:52.200
 So this reserve, this fund is definitely looking good this fiscal year.

00:31:52.200 --> 00:31:56.200
 The preliminary 2022, moving into this year's column that we're talking about now, and ultimately

00:31:56.200 --> 00:31:58.480
 we'll seek your approval for next month.

00:31:58.480 --> 00:32:04.800
 We have revenue of $38.6 million, that makes that number right here, and then $37.9 million

00:32:04.800 --> 00:32:11.840
 in expenses, about $653,000 in net income, with the ending fund balance by $15.7 million.

00:32:11.840 --> 00:32:13.480
 And then the targets are right here below.

00:32:13.480 --> 00:32:18.640
 So you can see the minimum is 100 days, with the maximum being 140 days, so that minimum

00:32:18.640 --> 00:32:25.200
 equates to about 11.5 as a value, and then $16.2 million on the maximum.

00:32:25.200 --> 00:32:29.400
 We do have an impact fee reserve in the wastewater fund, similar to water, and it's currently

00:32:29.400 --> 00:32:30.400
 $9.5 million.

00:32:30.400 --> 00:32:34.360
 And then we have a drainage reserve we call out separate, and we'll talk about drainage

00:32:34.360 --> 00:32:38.640
 here shortly, and a development plan line just for those large developments coming into

00:32:38.640 --> 00:32:39.640
 the community.

00:32:39.640 --> 00:32:44.080
 So we are looking at that million dollars, and how can we best utilize it in this utility.

00:32:44.080 --> 00:32:46.680
 In the future years, I do want to point out a couple of things, a little bit different

00:32:46.680 --> 00:32:51.360
 than the other utilities on water in the 10-year forecast, we were not showing any rate increases

00:32:51.360 --> 00:32:56.480
 for the entire 10-year period in wastewater, starting in fiscal year 2029, so it is several

00:32:56.480 --> 00:32:58.020
 years out still.

00:32:58.020 --> 00:33:02.280
 We do have some 1% rate increases plugged in in 2029 and 2030.

00:33:02.280 --> 00:33:06.320
 So we do anticipate within the 10-year period that this utility will be some rate increases

00:33:06.320 --> 00:33:07.320
 in the future.

00:33:07.320 --> 00:33:12.320
 So I just want to make sure we pointed that out to the PVB, and put that on your radar.

00:33:12.320 --> 00:33:17.080
 So this is a drainage 10-year forecast.

00:33:17.080 --> 00:33:21.320
 Drainage is ultimately a department, or an HBU, is what we call an HBU in the finance

00:33:21.320 --> 00:33:23.120
 department of wastewater.

00:33:23.120 --> 00:33:27.280
 This also rolls up into the proforma that you just saw a minute ago, but drainage is

00:33:27.280 --> 00:33:31.800
 supported, or the drainage operation within wastewater is supported by drainage revenue

00:33:31.800 --> 00:33:33.080
 in the community.

00:33:33.080 --> 00:33:37.800
 So residents and commercial businesses pay those drainage fees, those impervious services

00:33:37.800 --> 00:33:39.200
 into this fund.

00:33:39.200 --> 00:33:44.360
 So fiscal year 2021 is the current budget that we're in, about $5.9 million in revenues,

00:33:44.360 --> 00:33:46.260
 $5.9 million in expenses.

00:33:46.260 --> 00:33:51.080
 The majority of their budget is made up of channel rehab maintenance, and what that is,

00:33:51.080 --> 00:33:55.200
 the drainage channels that you see around the community is maintaining those, erosion,

00:33:55.200 --> 00:33:56.560
 mowing those, and so forth.

00:33:56.560 --> 00:33:59.840
 So the majority of the activity in this fund is for that purpose.

00:33:59.840 --> 00:34:06.840
 So preliminary budget, about $5.6 million in expenses.

00:34:06.840 --> 00:34:11.120
 Solid waste financial assumptions, very similar to the other utilities, we try to keep it

00:34:11.120 --> 00:34:14.280
 as consistent as possible when looking at the growth in the community.

00:34:14.280 --> 00:34:17.560
 Usually a resident or business comes in, they need water, wastewater, and solid waste service,

00:34:17.560 --> 00:34:19.680
 so the growth is pretty much the same.

00:34:19.680 --> 00:34:23.160
 On the revenue side, we have the 2% growth forecast in the out years.

00:34:23.160 --> 00:34:26.120
 We do have some anticipated wholesale agreements that are going to end in fiscal year 2023.

00:34:26.120 --> 00:34:30.040
 I'll talk about those shortly for some of the new PEB members that you'll know.

00:34:30.040 --> 00:34:34.480
 The Hunter Cole Ranch development does start showing up in 2023, and then we did put a

00:34:34.480 --> 00:34:38.600
 note on here for any PEB members that may not remember, or maybe you did, and the sale

00:34:38.600 --> 00:34:41.760
 construction in the current fiscal year, we did cash fund that development.

00:34:41.760 --> 00:34:48.160
 So it was moved from 2022 to 2021, we actually cash funded $6.5 million of that sale.

00:34:48.160 --> 00:34:51.520
 So great accomplishment with this fund, just want to make sure we pointed that out to the

00:34:51.520 --> 00:34:52.520
 board.

00:34:52.520 --> 00:34:57.000
 Supplemental request, currently this fund has 282,000 supplemental requests, made up

00:34:57.000 --> 00:35:03.080
 of 4.5 FTEs, was a field service worker too, heavy equipment operator, roll-off truck driver,

00:35:03.080 --> 00:35:10.500
 field services supervisor, and an intern, making up that .5.

00:35:10.500 --> 00:35:15.360
 So we showed a five-year forecast for the solid waste fund, very similar to water and

00:35:15.360 --> 00:35:18.160
 wastewater, and I apologize, it's a little bit blurry, but we'll try to see it the best

00:35:18.160 --> 00:35:19.160
 we can here.

00:35:19.160 --> 00:35:24.760
 So in 2021, the current adopted budget that we're in, you can see revenues of $39.8 million,

00:35:24.760 --> 00:35:32.440
 numbers right here, with expenses of $44.1, so we did have an adopted budget of $4.3 million

00:35:32.440 --> 00:35:34.480
 in reserve usage.

00:35:34.480 --> 00:35:38.760
 The council and the PBB both did approve a 5% rate decrease in the current fiscal year

00:35:38.760 --> 00:35:43.520
 for residential customers, equated about a dollar, I believe six cents a month was the

00:35:43.520 --> 00:35:44.520
 decrease.

00:35:44.520 --> 00:35:48.920
 You can see the estimate we were planning to come in, about $38.5 million in revenues,

00:35:48.920 --> 00:35:52.720
 $43.4 million in expenses, about $4.8 million in reserve usage.

00:35:52.720 --> 00:35:59.920
 So really close to the budget, just a little bit more than what we originally adopted.

00:35:59.920 --> 00:36:04.200
 Moving into the preliminary budget, you can see their revenues of $39.8, with expenses

00:36:04.200 --> 00:36:09.800
 of $37.1 or $2, positive income of $2.7 million.

00:36:09.800 --> 00:36:14.640
 The majority of this swing of not using reserves is that sale development that I mentioned

00:36:14.640 --> 00:36:15.640
 earlier.

00:36:15.640 --> 00:36:19.080
 We're not building that sale this upcoming year, so we're maintaining that revenue within

00:36:19.080 --> 00:36:21.840
 the fund to offset expenses.

00:36:21.840 --> 00:36:25.960
 Moving down the pages, we're not forecasting rate increases or decreases for this utility.

00:36:25.960 --> 00:36:30.840
 We do have an operating fund balance about $8.9 million finishing this upcoming year

00:36:30.840 --> 00:36:34.440
 of 2022, adopted by PB and city council.

00:36:34.440 --> 00:36:38.360
 The targets are down here in this pink, you can see the minimum of 5.2 with the maximum

00:36:38.360 --> 00:36:40.200
 of 6.7 million.

00:36:40.200 --> 00:36:44.800
 So we are well within that target and actually stay within that target in each of the five

00:36:44.800 --> 00:36:46.960
 year period.

00:36:46.960 --> 00:36:49.640
 Moving back up to the front of the top of the page here, I want to point this out to

00:36:49.640 --> 00:36:50.820
 the board really quick.

00:36:50.820 --> 00:36:55.420
 The wholesale agreements that I pointed out earlier, this forecast does not contemplate

00:36:55.420 --> 00:36:56.420
 those being renewed.

00:36:56.420 --> 00:37:01.160
 If the PB or city council gives us direction or gives, you know, Brian or Soloway's direction

00:37:01.160 --> 00:37:05.200
 to renew those contracts, this financial picture will change when we bring it back to you for

00:37:05.200 --> 00:37:06.920
 the 2023 budget discussion.

00:37:06.920 --> 00:37:11.320
 So just keep that in mind if those agreements are renewed, this entire financial picture

00:37:11.320 --> 00:37:19.840
 changes because you can't see that 6.2 million going away in 2023.

00:37:19.840 --> 00:37:23.680
 The electric financial assumptions, so I'll walk through these a little bit different

00:37:23.680 --> 00:37:28.800
 than water, wastewater, revenue and expenses, the average load growth of 1.5 million, looking

00:37:28.800 --> 00:37:30.480
 at the load within the community.

00:37:30.480 --> 00:37:35.200
 The T cost, allowable rate of return on investment, this is what Cassie had mentioned earlier,

00:37:35.200 --> 00:37:39.680
 this is still pending, so we have made some preliminary assumptions within the financial

00:37:39.680 --> 00:37:40.680
 forecast.

00:37:40.680 --> 00:37:47.160
 In fiscal year 2022, we're currently projecting 28.04% return on those transmission assets.

00:37:47.160 --> 00:37:52.760
 We do decrease this to 13.5% starting in fiscal year 2023, it's really to be proactive and

00:37:52.760 --> 00:37:54.480
 be conservative within this utility.

00:37:54.480 --> 00:37:58.480
 So we are making an assumption it's going to go down.

00:37:58.480 --> 00:38:02.800
 The return on investment of 6%, so this utility does pay a return on investment to the general

00:38:02.800 --> 00:38:06.280
 fund that ultimately makes its way to the streets fund that was increased a few years

00:38:06.280 --> 00:38:12.440
 ago when COVID hit I guess about a year and a half ago, it increased from 3.5% to 6%.

00:38:12.440 --> 00:38:16.280
 It is scheduled to decrease to 3.5% starting in fiscal year 2023.

00:38:16.280 --> 00:38:20.680
 So it will not stay at 6% unless we're directed for it to stay there.

00:38:20.680 --> 00:38:23.720
 Some more of the uncertainties that Cassie had mentioned earlier, the summer revenue

00:38:23.720 --> 00:38:27.080
 forecast, we'll bring this back to you in December once we get through the hot period

00:38:27.080 --> 00:38:31.800
 of July and August and really see how this fund performs and how the debt performs.

00:38:31.800 --> 00:38:35.480
 The transmission cost or T cost revenue that I mentioned earlier, that cost of service

00:38:35.480 --> 00:38:41.880
 study that was mentioned earlier, and then the potential TMP mine sales also noted here.

00:38:41.880 --> 00:38:47.480
 The reserve levels, so our currently policy is 60 to 75 days, which is 16 to 21%.

00:38:47.480 --> 00:38:50.880
 We did bring a conversation forward to the PBN City Council.

00:38:50.880 --> 00:38:54.160
 When the winter storm had hit a couple months ago talking about this reserve requirement

00:38:54.160 --> 00:38:58.880
 for each of the utilities, the financial recommendation was to leave it alone for water, wastewater,

00:38:58.880 --> 00:39:00.840
 and solid waste, but to increase it for electric.

00:39:00.840 --> 00:39:05.760
 So that was the guidance we've gotten so far from the PBN City Council and if that continues

00:39:05.760 --> 00:39:08.640
 to be the guidance, we'll bring that back forward to you as part of the budget adoption

00:39:08.640 --> 00:39:09.640
 process.

00:39:09.640 --> 00:39:13.280
 So look forward to that coming forward here in the next couple of months.

00:39:13.280 --> 00:39:18.160
 Supplemental request, so the DME or electric fund includes about $400,000 in supplemental

00:39:18.160 --> 00:39:19.160
 request.

00:39:19.160 --> 00:39:24.000
 The major items is a senior business intelligent analyst, a line designer, and meteorologist

00:39:24.000 --> 00:39:25.000
 services.

00:39:25.000 --> 00:39:27.600
 If you have a question of those, Tony can speak to it or Terry Nolte or anybody that's

00:39:27.600 --> 00:39:31.240
 here if you have questions regarding the supplemental packages.

00:39:31.240 --> 00:39:33.720
 The five-year forecast for the electric utility.

00:39:33.720 --> 00:39:40.920
 So in 2021, you can see adopted revenues is $231.4 million in revenues, about $231.1 million

00:39:40.920 --> 00:39:41.920
 in expenses.

00:39:41.920 --> 00:39:45.040
 So we basically had a break-even budget in the current budget year.

00:39:45.040 --> 00:39:47.160
 We didn't use any reserves or anything.

00:39:47.160 --> 00:39:48.160
 You can see the estimate.

00:39:48.160 --> 00:39:51.720
 We have estimated revenue of $344.8 million.

00:39:51.720 --> 00:39:55.960
 That is above what we are budgeted, mainly due to the deck running during the winter

00:39:55.960 --> 00:40:00.600
 storm and the revenue that it brought in to offset that purchase power expense.

00:40:00.600 --> 00:40:04.080
 Expenses of $337 million, which is above the budget.

00:40:04.080 --> 00:40:07.060
 We did bring a budget amendment forward for the electric utility earlier this year to

00:40:07.060 --> 00:40:10.080
 offset those purchase power expenses of the winter storm also.

00:40:10.080 --> 00:40:13.880
 So that is the reason it's above the budget, just want to make sure we pointed that out.

00:40:13.880 --> 00:40:18.520
 So we showed net income, about $7.8 million is what we're forecasting, and that does anticipate

00:40:18.520 --> 00:40:20.240
 the rest of the summer months.

00:40:20.240 --> 00:40:27.120
 In 2022, the preliminary budget, you can see we have $227.5 million in revenues, about

00:40:27.120 --> 00:40:32.200
 $226.6 million in expenses, so just about $940,000 in net income.

00:40:32.200 --> 00:40:35.920
 No rate increases are currently being proposed, as Cassie had mentioned.

00:40:35.920 --> 00:40:40.440
 Once we get through these hotter months in the summer, we'll bring it back to discussion

00:40:40.440 --> 00:40:44.380
 to you in December and talk about future rate increases if they're needed.

00:40:44.380 --> 00:40:49.440
 So the current reserve target is $119.2 million, or $119.2 million is currently what we have

00:40:49.440 --> 00:40:51.720
 in the operating reserve and electric.

00:40:51.720 --> 00:40:55.120
 What we did is we broke out the current reserve and the proposed.

00:40:55.120 --> 00:40:58.440
 So under the proposed reserve targets, we'll bring back forward to you or continue to bring

00:40:58.440 --> 00:41:00.480
 back forward to you in the budget discussions.

00:41:00.480 --> 00:41:06.080
 The minimum would be $104.2 million, with the maximum being $156.3 million.

00:41:06.080 --> 00:41:09.040
 So we are within that target in the current year.

00:41:09.040 --> 00:41:14.320
 As we go in the future years, and you can see we do dip below that target to $72.5 million.

00:41:14.320 --> 00:41:18.040
 So that would really feed into that conversation regarding future rate increases as we come

00:41:18.040 --> 00:41:19.840
 back to PAB.

00:41:19.840 --> 00:41:24.680
 The current reserve target, what was currently in place is the minimum is $36.2, but the

00:41:24.680 --> 00:41:26.400
 maximum $47.5.

00:41:26.400 --> 00:41:31.200
 So simply the current operating reserve is within the target that's currently in place.

00:41:31.200 --> 00:41:37.840
 But if we were to change that target in the future years, we would be below it.

00:41:37.840 --> 00:41:40.120
 The capital budgets, we'll go through these quickly.

00:41:40.120 --> 00:41:43.960
 And then definitely if you need more detail, in your backup today, there was what we consider

00:41:43.960 --> 00:41:45.480
 a mini budget book.

00:41:45.480 --> 00:41:49.720
 What that is, it's just an operational line item budget for each of the departments within

00:41:49.720 --> 00:41:50.720
 each of the utilities.

00:41:50.720 --> 00:41:56.280
 So for water, wastewater, solid waste, and electric, and also included their capital projects.

00:41:56.280 --> 00:41:57.880
 Definitely let us know if you have questions on that.

00:41:57.880 --> 00:42:01.080
 So this is the water five-year capital plan.

00:42:01.080 --> 00:42:03.800
 We do summarize it by different debt issuances.

00:42:03.800 --> 00:42:09.840
 So in fiscal year 2022, for example, you can see we have $41 million in debt issuance plan

00:42:09.840 --> 00:42:11.380
 for this utility.

00:42:11.380 --> 00:42:15.240
 Revenue funding, so it's funded by that rate revenue of the operating fund, about $9.9

00:42:15.240 --> 00:42:16.240
 million.

00:42:16.240 --> 00:42:19.440
 Aiding construction, $265,000.

00:42:19.440 --> 00:42:24.720
 Impact fee funding, so revenue funding of impact fee eligible projects, about $3.5 million.

00:42:24.720 --> 00:42:28.760
 Also some vehicle replacement, a cash fund in those vehicles within this utility of $300,000.

00:42:28.760 --> 00:42:39.680
 So total capital program in 2022 is about $55.1 million in the upcoming year.

00:42:39.680 --> 00:42:42.400
 These are some of the major projects within water.

00:42:42.400 --> 00:42:45.600
 This is not an exhaustive list, but we did want to provide you the major projects that

00:42:45.600 --> 00:42:46.600
 are coming up.

00:42:46.600 --> 00:42:50.640
 So you can see the north missed transmission lines of $14.9 million.

00:42:50.640 --> 00:42:52.840
 The Ray Roberts capacity rerate of 11.

00:42:52.840 --> 00:42:56.880
 You can see 2019 bond election projects of $3.2 million.

00:42:56.880 --> 00:43:00.280
 That's to support those bond elections or the street segments that were approved by

00:43:00.280 --> 00:43:02.320
 voters a couple of years ago.

00:43:02.320 --> 00:43:05.720
 Annual field service replacements, so existing line replacements.

00:43:05.720 --> 00:43:10.400
 And Lake Lizzle treatment plan expansion of $2.5 million.

00:43:10.400 --> 00:43:14.360
 So total of these projects is about $38.5 million, so making up about three quarters

00:43:14.360 --> 00:43:18.840
 or 80% of that total capital plan.

00:43:18.840 --> 00:43:21.200
 Wastewater five-year capital projects, same thing here.

00:43:21.200 --> 00:43:25.880
 You can see debt funded projects for the wastewater utility, very similar to water, $40.1 million

00:43:25.880 --> 00:43:28.380
 in projects for the debt side.

00:43:28.380 --> 00:43:32.520
 Revenue funding about $5 million, aid in construction of $82,000.

00:43:32.520 --> 00:43:34.480
 Impact fee funding a little bit less.

00:43:34.480 --> 00:43:38.560
 Eligible projects are not as many on the wastewater side, so about $250,000 in impact fee eligible

00:43:38.560 --> 00:43:39.560
 projects.

00:43:39.560 --> 00:43:43.560
 And the vehicle replacement, they have a few more vehicles being replaced, about $1.4 million.

00:43:43.560 --> 00:43:51.960
 So $46.9 million in total capital projects in fiscal year 2022.

00:43:51.960 --> 00:43:56.760
 And if I need to slow down or go back, just let me know, as fast as I can, get through

00:43:56.760 --> 00:43:57.760
 the presentation here.

00:43:57.760 --> 00:44:02.320
 Solid waste handling, so for the wastewater utility, they have a $14 million project coming

00:44:02.320 --> 00:44:03.320
 up this year.

00:44:03.320 --> 00:44:04.320
 It's phase one.

00:44:04.320 --> 00:44:06.760
 The design completion is July 2021.

00:44:06.760 --> 00:44:10.640
 Hickory Creek, the wastewater treatment plant land acquisition of $5.8 million, something

00:44:10.640 --> 00:44:12.480
 that's currently being worked on now.

00:44:12.480 --> 00:44:18.000
 Hickory Creek Interceptor 3 of $4 million, 2019 bond elections of being consistent across

00:44:18.000 --> 00:44:21.760
 the city with those projects, and then the field service replacements.

00:44:21.760 --> 00:44:23.760
 And then you can see the wastewater master plan.

00:44:23.760 --> 00:44:28.280
 One note I will make on the 2019 bond election program, one thing staff is doing differently

00:44:28.280 --> 00:44:32.120
 this year than we have in the past, is we're having cross-departmental meetings just to

00:44:32.120 --> 00:44:36.280
 ensure that what's in the wastewater and water utility is consistent with what engineering

00:44:36.280 --> 00:44:37.280
 is budgeting.

00:44:37.280 --> 00:44:40.160
 So if engineering's planning to replace the street, we're also on the water wastewater

00:44:40.160 --> 00:44:41.720
 side anticipating the same thing.

00:44:41.720 --> 00:44:46.880
 So we just want to make sure we're consistent across the city.

00:44:46.880 --> 00:44:47.880
 This is CIP budget.

00:44:47.880 --> 00:44:49.160
 I'm sorry, this one is not labeled.

00:44:49.160 --> 00:44:51.320
 This is for the solid waste utility.

00:44:51.320 --> 00:44:54.880
 You can see they do issue different types of debt issuances.

00:44:54.880 --> 00:44:59.820
 So 20-year debt, about $2 million, five-year debt, about $483,000.

00:44:59.820 --> 00:45:04.080
 Revenue funding, about $40,000, and vehicle replacement, by far, is their largest usual

00:45:04.080 --> 00:45:07.360
 capital project of the year, unless there's cell development, about $4.2 million.

00:45:07.360 --> 00:45:12.120
 And then you can see how it breaks down by different, just different type of projects.

00:45:12.120 --> 00:45:16.840
 You can see street, structural, vehicles, and then building construction, about a million.

00:45:16.840 --> 00:45:21.080
 So total, 6.7.

00:45:21.080 --> 00:45:26.040
 The electric utility, so you can see where the projects fit into the different categories.

00:45:26.040 --> 00:45:28.180
 You can see fiscal year 2022 in this column.

00:45:28.180 --> 00:45:33.400
 Some of the major categories that you see is distribution substations, distribution transformers,

00:45:33.400 --> 00:45:37.640
 feeder extensions and improvements, new residential and commercial.

00:45:37.640 --> 00:45:40.120
 And then, of course, we've got the street lighting, and it's been talked about the last

00:45:40.120 --> 00:45:44.120
 couple of fiscal years, and then the electric relocations.

00:45:44.120 --> 00:45:46.120
 So distribution total, $34.4 million.

00:45:46.120 --> 00:45:51.440
 Then you can see some transmission lines and transmission substations for $24.5.

00:45:51.440 --> 00:45:55.920
 So total capital projects, and all this added up is $58.9 million.

00:45:55.920 --> 00:45:59.040
 We then take that number and divide how it's going to be funded through the utility.

00:45:59.040 --> 00:46:05.840
 It's about $4.4 million in aid and construction, $52.9 million in CO issuances, and then $1.7

00:46:05.840 --> 00:46:09.680
 million in revenue funding from the rate revenue within the utility.

00:46:09.680 --> 00:46:14.120
 So the five-year capital total is $215.9 million.

00:46:14.120 --> 00:46:18.080
 I think the question was asked last time we were at PUB about, you know, does the PUB

00:46:18.080 --> 00:46:20.120
 adopt each one of these five-year capital plans?

00:46:20.120 --> 00:46:21.120
 The answer is no.

00:46:21.120 --> 00:46:25.400
 The only thing we're looking for your adoption in August or your approval for is 2022.

00:46:25.400 --> 00:46:27.320
 So just keep that in mind when you look at this five-year plan.

00:46:27.320 --> 00:46:33.320
 It's for planning purposes, but you will only adopt the 2022 budget.

00:46:33.320 --> 00:46:38.180
 So next steps, the DME presentation is scheduled to go to City Council on July the 20th.

00:46:38.180 --> 00:46:41.280
 Water and wastewater will be at the end of this month on July the 27th, along with solid

00:46:41.280 --> 00:46:42.280
 waste.

00:46:42.280 --> 00:46:47.240
 July 26th, probably should have put that before the 27th, but PUB will be looking for your

00:46:47.240 --> 00:46:51.100
 approval for the budget and start the rate conversation.

00:46:51.100 --> 00:46:56.360
 So the next meeting that PUB has will bring back the budgets for your approval to take

00:46:56.360 --> 00:46:59.880
 at the City Council, and then we'll start those rate conversations and start talking

00:46:59.880 --> 00:47:02.120
 about the rate structure itself.

00:47:02.120 --> 00:47:06.280
 August 2nd is the big City Council budget workshop where all the budgets in the city

00:47:06.280 --> 00:47:07.680
 will be talked about.

00:47:07.680 --> 00:47:12.200
 And then August 23rd, we'll come back to the PUB for that final rate approval.

00:47:12.200 --> 00:47:18.240
 And then September 21st, the City Council will adopt the budget, the tax rate, the utility

00:47:18.240 --> 00:47:24.120
 rates, and the capital plan for the utilities and the general fund.

00:47:24.120 --> 00:47:27.880
 And I'll take this presentation down and address any questions, and if there's operational

00:47:27.880 --> 00:47:29.440
 questions, the directors are here, too.

00:47:29.440 --> 00:47:32.560
 Just feel free to ask us anything you have for us today.

00:47:32.560 --> 00:47:33.560
 Questions?

00:47:33.560 --> 00:47:42.880
 You must have done a very good job.

00:47:42.880 --> 00:47:50.760
 Thank you.

00:47:50.760 --> 00:48:09.880
 Madam Chair, Board Members, Krista Foster, Customer Service Manager, and I'm here today

00:48:09.880 --> 00:48:17.920
 to present the customer service budget for FY21-22.

00:48:17.920 --> 00:48:21.400
 So first, I'm going to give you an overview of our division.

00:48:21.400 --> 00:48:27.480
 We have 46 wonderful, dedicated members of our team, and this is just a quick layout

00:48:27.480 --> 00:48:31.280
 of that group.

00:48:31.280 --> 00:48:34.800
 As we move into talking about our budget, the first thing we're going to look at is

00:48:34.800 --> 00:48:35.800
 accomplishments.

00:48:35.800 --> 00:48:37.280
 I'm not going to read every one of these to you.

00:48:37.280 --> 00:48:39.200
 I believe that each of you can read.

00:48:39.200 --> 00:48:42.620
 But I do want to capitalize at least a couple of items off of each slide.

00:48:42.620 --> 00:48:46.400
 The first thing that we're very proud of in customer service over the last year is we

00:48:46.400 --> 00:48:51.320
 have taken on agency assistance referrals for customers who have trouble paying their

00:48:51.320 --> 00:48:52.640
 utility bills.

00:48:52.640 --> 00:48:58.200
 So at this point in time, staff will identify that need and ask the customer if they would

00:48:58.200 --> 00:49:04.960
 like to have a referral to the agency, we'll fill out the basic screening intake paperwork,

00:49:04.960 --> 00:49:09.920
 provide that to the agency, we do a follow-up email to the customer with all of the requirements

00:49:09.920 --> 00:49:14.940
 that they're going to need to meet, and we give them a protected time window that their

00:49:14.940 --> 00:49:19.080
 services will not see an eruption because they're in that process.

00:49:19.080 --> 00:49:20.800
 And we're working closely with the agency.

00:49:20.800 --> 00:49:24.560
 So if the agency is saying, "Hey, it's going to take a little longer," they're giving

00:49:24.560 --> 00:49:28.400
 us a contact to say, "Please continue to take care of this customer."

00:49:28.400 --> 00:49:30.620
 So we're very proud of that process.

00:49:30.620 --> 00:49:35.560
 We actually have incorporated this so that the follow-up emails can be sent either in

00:49:35.560 --> 00:49:37.480
 English or in Spanish.

00:49:37.480 --> 00:49:40.700
 Additionally, we've offered translation services.

00:49:40.700 --> 00:49:45.080
 I was very surprised that that was something with as diverse a community as Denton is with

00:49:45.080 --> 00:49:48.880
 the universities and things that we didn't offer.

00:49:48.880 --> 00:49:51.400
 Translation services by phone, so we now do.

00:49:51.400 --> 00:49:56.560
 So if someone calls in and English is not their first language, we can identify that,

00:49:56.560 --> 00:50:02.960
 call a translator, and process a three-way call so that we can provide better assistance.

00:50:02.960 --> 00:50:06.320
 This is just a slide just because I wanted to brag on my guys.

00:50:06.320 --> 00:50:10.800
 We have in our Microsoft Teams group, we have a superstar channel, and that's where we do

00:50:10.800 --> 00:50:11.800
 shout-outs.

00:50:11.800 --> 00:50:16.440
 If customers say something great about people, the reps will go back in and say, "Hey, shout-out

00:50:16.440 --> 00:50:17.440
 to so-and-so.

00:50:17.440 --> 00:50:20.020
 This is what the customers are saying about you."

00:50:20.020 --> 00:50:27.760
 And I know that as board members, you get to hear sometimes the less productive conversations,

00:50:27.760 --> 00:50:33.560
 but we want you to know that there are plenty of positives out there.

00:50:33.560 --> 00:50:39.840
 So again, we have accomplishments, nope, I went wrong way, our goals for next year.

00:50:39.840 --> 00:50:44.240
 Customer service has some pretty lofty goals coming up over the next year.

00:50:44.240 --> 00:50:49.680
 The first of those is we are now actively working on the 311 implementation.

00:50:49.680 --> 00:50:51.880
 We are in the discovery process.

00:50:51.880 --> 00:50:59.480
 We are in the contract negotiation phase for a customer service software, customer relationship

00:50:59.480 --> 00:51:05.440
 management software, and we'll be implementing that over the next year.

00:51:05.440 --> 00:51:11.040
 Additionally, we will be coming back to you soon and talking about changing a payment

00:51:11.040 --> 00:51:12.040
 vendor.

00:51:12.040 --> 00:51:16.040
 We've had some problems with one of our payment vendors, and we've identified, we're putting

00:51:16.040 --> 00:51:22.320
 out an RFP to see if we can provide better services there, and we are in contract negotiations

00:51:22.320 --> 00:51:27.080
 for a new customer portal that will allow greater functionality.

00:51:27.080 --> 00:51:32.280
 Customers will be able to do things like truly set up and terminate services online.

00:51:32.280 --> 00:51:36.680
 Currently we offer terminations and moves, but they're self-service for the customer,

00:51:36.680 --> 00:51:39.840
 but they come in as an email and we have to process them manually.

00:51:39.840 --> 00:51:44.080
 So we'll be moving into things that will provide better automation and better efficiencies

00:51:44.080 --> 00:51:50.580
 and much greater scope of service for our customers.

00:51:50.580 --> 00:51:56.060
 Process improvements, clearly we've got a lot of them, but the one that we're this year

00:51:56.060 --> 00:52:01.740
 most proud of is that we implemented remote reconnections.

00:52:01.740 --> 00:52:05.840
 So when a customer's service is interrupted and they call and take care of that payment,

00:52:05.840 --> 00:52:11.300
 we can actually go into the system and process it to have them turned on in 30 minutes or

00:52:11.300 --> 00:52:12.760
 less.

00:52:12.760 --> 00:52:17.240
 That is for 90 plus percent probably of our customers at this point.

00:52:17.240 --> 00:52:21.000
 Occasionally electronics have their issues and we have to actually send someone to a

00:52:21.000 --> 00:52:26.640
 site, but by and large we're getting those customers turned on faster than ever.

00:52:26.640 --> 00:52:31.120
 Next year we're going to be working, just like I mentioned before, on more automation

00:52:31.120 --> 00:52:37.160
 of our self-service and better efficiencies for customers and staff.

00:52:37.160 --> 00:52:38.380
 These are a few of our metrics.

00:52:38.380 --> 00:52:42.720
 These are some metrics that we use to gauge how effective are we fiscally.

00:52:42.720 --> 00:52:47.260
 So you can see that's what's our overhead cost versus the revenue that we're collecting

00:52:47.260 --> 00:52:54.040
 for the organization, our collection rate versus what becomes uncollectible debt, self-service

00:52:54.040 --> 00:52:58.560
 adoption, because if we can get customers to be able to do some of the simpler things

00:52:58.560 --> 00:53:03.420
 on their own, it frees staff to dedicate the time that's necessary for those customers

00:53:03.420 --> 00:53:08.400
 who really have those complex problems, and then first contact resolution.

00:53:08.400 --> 00:53:12.520
 We'll talk about that in just another moment going forward, because these are some of the

00:53:12.520 --> 00:53:16.800
 metrics that we use to gauge where are we and where are we going.

00:53:16.800 --> 00:53:21.020
 So the first thing you'll notice is we're seeing almost a 10% change over the last four

00:53:21.020 --> 00:53:23.920
 years just in the number of accounts.

00:53:23.920 --> 00:53:28.100
 Over the last ten years, you know, it seems like it's a small amount, and I think it was

00:53:28.100 --> 00:53:34.260
 only maybe 54,000 ten years ago, but that small change because we produce monthly bills

00:53:34.260 --> 00:53:40.200
 means that billing staff is currently producing 170,000 more bills than they were ten years

00:53:40.200 --> 00:53:41.200
 ago.

00:53:41.200 --> 00:53:45.060
 So it's a lot of change even though it seems like a small number.

00:53:45.060 --> 00:53:50.260
 The other is you can see that our call center volume has gone up dramatically.

00:53:50.260 --> 00:53:58.020
 We're currently at the end of May, over 180,000 calls already this year with the busiest months

00:53:58.020 --> 00:53:59.260
 left to go.

00:53:59.260 --> 00:54:05.200
 We're anticipating reaching or exceeding 250,000 calls this year.

00:54:05.200 --> 00:54:07.900
 So we've seen a lot of change there.

00:54:07.900 --> 00:54:13.340
 Again, first call resolution, and we also track our very satisfied and very dissatisfied

00:54:13.340 --> 00:54:16.820
 customer bases for telling us how effective we are.

00:54:16.820 --> 00:54:21.340
 First call resolution is obviously we don't want someone to have to call us 100 times,

00:54:21.340 --> 00:54:27.460
 but the very satisfied, very dissatisfied, these are the people who drive our image in

00:54:27.460 --> 00:54:28.740
 the community.

00:54:28.740 --> 00:54:32.140
 And these numbers, all three of these are customer reported.

00:54:32.140 --> 00:54:35.860
 At the end of every contact, the customer is given the opportunity to participate in

00:54:35.860 --> 00:54:37.500
 a three-question survey.

00:54:37.500 --> 00:54:44.060
 So this is what our customers are saying about our effectiveness.

00:54:44.060 --> 00:54:45.060
 All right.

00:54:45.060 --> 00:54:49.180
 So as we move into the budget highlights, first we are an internal service fund.

00:54:49.180 --> 00:54:55.620
 So this is just a breakout of where is the money coming from within the organization

00:54:55.620 --> 00:54:57.620
 to fund our budget.

00:54:57.620 --> 00:55:00.580
 And I'll give you just a moment.

00:55:00.580 --> 00:55:06.220
 I don't want to go through all of them, but give you a second to be able to look.

00:55:06.220 --> 00:55:10.700
 And then I'm going to give you our actual budget, our estimates and preliminaries.

00:55:10.700 --> 00:55:16.500
 So the first thing with our budget is you'll notice that the budgeted amount versus our

00:55:16.500 --> 00:55:19.940
 estimate do not match.

00:55:19.940 --> 00:55:25.180
 During the pandemic, we end with raising all the call volumes that you saw that have gone

00:55:25.180 --> 00:55:26.180
 up.

00:55:26.180 --> 00:55:33.860
 We had to shoulder $483,000 in unbudgeted costs between additional assistance that we're

00:55:33.860 --> 00:55:38.680
 providing people and some of the staffing changes that we had to make.

00:55:38.680 --> 00:55:45.460
 Of that, we look like we are maybe going to end up having to come back for a budget amendment,

00:55:45.460 --> 00:55:47.420
 but it will not be for $483,000.

00:55:47.420 --> 00:55:51.020
 It'll be somewhere in the $200,000 range.

00:55:51.020 --> 00:55:54.200
 All right.

00:55:54.200 --> 00:56:02.020
 Then again, the FTE summary, we have 46 headcount.

00:56:02.020 --> 00:56:09.420
 And so because 311 and CRM is a little complicated, it's complicated for people because 311 can

00:56:09.420 --> 00:56:13.580
 look very differently depending on where you go and who set it up.

00:56:13.580 --> 00:56:17.520
 So we wanted to take some time to walk you through this as we're bringing in a supplemental

00:56:17.520 --> 00:56:22.660
 request for the actual contact center side of the things that are going to have to happen

00:56:22.660 --> 00:56:24.220
 with that.

00:56:24.220 --> 00:56:27.640
 The first thing was just to give you a good definition, this is the only thing I'm going

00:56:27.640 --> 00:56:34.580
 to redirect and that's that a 311 center utilizes centralized staff and customer relationship

00:56:34.580 --> 00:56:41.100
 software to streamline access to city services, increase departmental efficiencies and provide

00:56:41.100 --> 00:56:45.060
 citizens a single point of contact for all of their needs.

00:56:45.060 --> 00:56:49.540
 Basically, you'll see below that decentralized structure, that's kind of where we are today.

00:56:49.540 --> 00:56:54.220
 A resident has to understand and know how the city operates in order to find the correct

00:56:54.220 --> 00:56:55.220
 division.

00:56:55.220 --> 00:56:58.380
 A lot of times that involves a lot of transfers.

00:56:58.380 --> 00:57:02.860
 So what we're going to be moving to is the 311 center.

00:57:02.860 --> 00:57:08.300
 We're going to utilize this customer relationship software to make sure that we can have real

00:57:08.300 --> 00:57:10.780
 time communication to the different divisions.

00:57:10.780 --> 00:57:15.220
 So you have one point of contact that can take talk to that customer, enter their needs

00:57:15.220 --> 00:57:21.780
 into the appropriate work order system and get them the resolutions that they need.

00:57:21.780 --> 00:57:22.780
 How does it work?

00:57:22.780 --> 00:57:24.760
 This is kind of that layout of that structure.

00:57:24.760 --> 00:57:31.220
 We have multiple contact channels that will come through one set of staff who deal with

00:57:31.220 --> 00:57:35.540
 talking to customers when we're placing information into the system, we're going to be placing

00:57:35.540 --> 00:57:40.900
 that into the CRM software and it's going to automatically break things out into the

00:57:40.900 --> 00:57:42.880
 areas they need to go with.

00:57:42.880 --> 00:57:46.380
 We can also have milestones.

00:57:46.380 --> 00:57:51.140
 So as these things go through the process, it can send that customer back notification

00:57:51.140 --> 00:57:55.180
 that this is what's happened, the status of your work order has changed and this is where

00:57:55.180 --> 00:57:56.180
 we are.

00:57:56.180 --> 00:57:57.900
 This has now been completed.

00:57:57.900 --> 00:58:00.420
 That is difficult to do currently.

00:58:00.420 --> 00:58:05.560
 And then it gives us a great wealth of information so that we can just make good business decisions

00:58:05.560 --> 00:58:09.400
 as we move forward.

00:58:09.400 --> 00:58:10.700
 So this is our timeline.

00:58:10.700 --> 00:58:16.420
 We started working on some of the development as far back as the summer of 2019.

00:58:16.420 --> 00:58:21.220
 We had a little bit of a lag as we did some process stuff and had a pandemic.

00:58:21.220 --> 00:58:25.240
 But we've now gotten into the procurement phase for the CRM.

00:58:25.240 --> 00:58:28.780
 We have a finalist and we're in contract negotiations.

00:58:28.780 --> 00:58:32.580
 We've already begun mapping processes with all of the different divisions and identified

00:58:32.580 --> 00:58:36.800
 some of the groups that will be coming in as part of our phase one development.

00:58:36.800 --> 00:58:42.260
 And we're planning to have our kickoff later this summer or early fall.

00:58:42.260 --> 00:58:47.940
 We're expecting the implementation to be done sometime during the next fiscal year.

00:58:47.940 --> 00:58:50.420
 And this is what it costs.

00:58:50.420 --> 00:58:57.020
 So what we're looking for in our supplemental, the CRM software has already been debt funded

00:58:57.020 --> 00:58:59.720
 and it is paid for.

00:58:59.720 --> 00:59:02.820
 We have our consultants that we have on board helping us with that.

00:59:02.820 --> 00:59:07.520
 This is for the cost of some of the positions that are going to be necessary to be able

00:59:07.520 --> 00:59:14.460
 to bring in those additional calls as well as getting our equipment so that we have the

00:59:14.460 --> 00:59:17.320
 correct number of computers and phones and things of that nature.

00:59:17.320 --> 00:59:21.940
 So the one-time cost is $84,700.

00:59:21.940 --> 00:59:25.020
 That includes a contingency of $74,000.

00:59:25.020 --> 00:59:29.380
 Just in case, timelines may tweak just a little bit.

00:59:29.380 --> 00:59:39.580
 But the total cost for next fiscal year, $373,510, with an ongoing recurring cost of $505,000.

00:59:39.580 --> 00:59:44.340
 The reason that you're seeing it a little bit lower in year one is because we're prorating

00:59:44.340 --> 00:59:48.940
 salaries because we're not anticipating needing these people October 1.

00:59:48.940 --> 00:59:53.500
 So we've prorated those salaries.

00:59:53.500 --> 00:59:54.500
 And that is it.

00:59:54.500 --> 01:00:03.780
 People will be happy to answer any questions.

01:00:03.780 --> 01:00:09.740
 So what departments are going to be part of phase one implementation of 311?

01:00:09.740 --> 01:00:15.020
 Well, we didn't include them in this just in case something changes, but right now what

01:00:15.020 --> 01:00:21.260
 we're looking at for phase one are animal services simply because of the huge call volume.

01:00:21.260 --> 01:00:24.480
 And it's very difficult for them to maintain.

01:00:24.480 --> 01:00:31.340
 Something else we're looking at right now is community improvement and all utility infrastructure

01:00:31.340 --> 01:00:37.000
 areas because those are the areas where customers really have to have a degree in city government

01:00:37.000 --> 01:00:39.140
 before they know where they're trying to go.

01:00:39.140 --> 01:00:43.540
 We're taking all those things that tend to overlap one another so that we can try to

01:00:43.540 --> 01:00:46.100
 make things as easy as possible for customers.

01:00:46.100 --> 01:00:48.380
 And does that include like streets?

01:00:48.380 --> 01:00:53.300
 It would include things like streets, water, wastewater.

01:00:53.300 --> 01:00:55.580
 We already do utilities, so we do them.

01:00:55.580 --> 01:01:02.060
 But it's going to have like water, wastewater, engineering, the other part of public works.

01:01:02.060 --> 01:01:05.660
 So it's all those infrastructure groups.

01:01:05.660 --> 01:01:06.660
 And will this work?

01:01:06.660 --> 01:01:07.660
 Oh, sorry.

01:01:07.660 --> 01:01:08.660
 I'm sorry.

01:01:08.660 --> 01:01:09.660
 Permitting.

01:01:09.660 --> 01:01:10.660
 I'm just...

01:01:10.660 --> 01:01:11.660
 Not at this time.

01:01:11.660 --> 01:01:12.660
 Okay.

01:01:12.660 --> 01:01:15.940
 Permitting is a little different because it requires you to interpret code.

01:01:15.940 --> 01:01:21.260
 And when you have someone that's that broad a generalist, code interpretation tends to

01:01:21.260 --> 01:01:23.500
 be a little bit much.

01:01:23.500 --> 01:01:25.540
 Yeah, a little difficult.

01:01:25.540 --> 01:01:26.540
 Sorry.

01:01:26.540 --> 01:01:27.540
 Go ahead.

01:01:27.540 --> 01:01:32.580
 And will the system work with or replace the current engaged Netton app?

01:01:32.580 --> 01:01:33.580
 Yes.

01:01:33.580 --> 01:01:38.740
 The CRM software will actually have a fully functional mobile app.

01:01:38.740 --> 01:01:42.780
 And as a matter of fact, any of the things that we build for customer service as knowledge

01:01:42.780 --> 01:01:46.980
 based articles or any division that's using it can build knowledge based articles that

01:01:46.980 --> 01:01:49.900
 have both public and private information.

01:01:49.900 --> 01:01:53.060
 Any of that public information can be on our website.

01:01:53.060 --> 01:01:57.100
 So we have one document that provides the public a place that they can search a knowledge

01:01:57.100 --> 01:01:58.260
 base as well.

01:01:58.260 --> 01:02:03.900
 You can place in links so that if they read the knowledge base article and say, oh yeah,

01:02:03.900 --> 01:02:07.620
 this is my issue, and it's something that they can create a work order for themselves,

01:02:07.620 --> 01:02:09.980
 the link can be right there in the knowledge base article.

01:02:09.980 --> 01:02:10.980
 Nice.

01:02:10.980 --> 01:02:16.900
 And is there a plan to transition from engaged Netton app to the future app?

01:02:16.900 --> 01:02:17.900
 There will be a plan.

01:02:17.900 --> 01:02:20.980
 I don't know that we're quite to that place yet, because we're going to be learning a

01:02:20.980 --> 01:02:24.060
 little bit about this software as we get into the implementation phase.

01:02:24.060 --> 01:02:28.780
 Right now we're really doing all of that ground work and doing that discovery of what are

01:02:28.780 --> 01:02:32.300
 all the things that we're going to need to replace from the engaged Netton?

01:02:32.300 --> 01:02:34.300
 What are we going to be transitioning?

01:02:34.300 --> 01:02:37.580
 How are we going to interface with these different work order applications?

01:02:37.580 --> 01:02:42.460
 So we're in that discovery phase at the moment.

01:02:42.460 --> 01:02:44.980
 I have a question.

01:02:44.980 --> 01:02:50.300
 So how will this affect existing city staff, whether that be customer service or whatever

01:02:50.300 --> 01:02:51.300
 else?

01:02:51.300 --> 01:02:56.020
 You know, the only thing it will affect with my staff is that we're going to have a broader

01:02:56.020 --> 01:03:01.060
 base of information that we're going to be supplying and much better tools to do it.

01:03:01.060 --> 01:03:05.020
 If we find that we're moving a tremendous amount of call load and we're taking three

01:03:05.020 --> 01:03:10.900
 people's worth of work out of a division, then we can look at moving staff there.

01:03:10.900 --> 01:03:16.460
 Because that's obviously going to be our first goal before going out and adding new FTE to

01:03:16.460 --> 01:03:17.460
 the budgets.

01:03:17.460 --> 01:03:18.460
 Right?

01:03:18.460 --> 01:03:20.900
 But we're going to be evaluating it as we go.

01:03:20.900 --> 01:03:24.900
 So it should be nothing more than just really some changing and shuffling of staff.

01:03:24.900 --> 01:03:28.820
 I have to say, I really appreciate the direction here.

01:03:28.820 --> 01:03:32.420
 That's systematizing and automation is near and dear to my heart.

01:03:32.420 --> 01:03:35.260
 I do a lot of that in my job.

01:03:35.260 --> 01:03:36.860
 So I'm excited to see where this goes.

01:03:36.860 --> 01:03:37.860
 Yes.

01:03:37.860 --> 01:03:38.860
 I'm very excited.

01:03:38.860 --> 01:03:40.980
 Is the training included in the budget as well?

01:03:40.980 --> 01:03:41.980
 Is what?

01:03:41.980 --> 01:03:42.980
 The training?

01:03:42.980 --> 01:03:43.980
 The training?

01:03:43.980 --> 01:03:44.980
 For the staff?

01:03:44.980 --> 01:03:45.980
 Yes.

01:03:45.980 --> 01:03:46.980
 Okay.

01:03:46.980 --> 01:03:47.980
 Yeah.

01:03:47.980 --> 01:03:48.980
 Okay.

01:03:48.980 --> 01:03:52.500
 As a person who really likes the voice that I get, and I have an opportunity to talk with

01:03:52.500 --> 01:04:00.620
 them many times, managing property, having utilities on and off and things done, it's

01:04:00.620 --> 01:04:01.860
 great staff.

01:04:01.860 --> 01:04:02.860
 They are friendly.

01:04:02.860 --> 01:04:03.860
 They are helpful.

01:04:03.860 --> 01:04:04.860
 Thank you.

01:04:04.860 --> 01:04:05.860
 They take care of it.

01:04:05.860 --> 01:04:08.380
 And I just can't say enough good about your department.

01:04:08.380 --> 01:04:11.300
 We have some really great frontline representatives.

01:04:11.300 --> 01:04:12.300
 You do.

01:04:12.300 --> 01:04:15.500
 They're very dedicated and they work really hard.

01:04:15.500 --> 01:04:20.020
 As a property manager, you're probably going to find that our new customer portal will

01:04:20.020 --> 01:04:25.340
 be wonderful for you because it will allow you to be able to have, right off the get-go,

01:04:25.340 --> 01:04:29.980
 all of your bills under the one login, and you'll be able to make a single payment for

01:04:29.980 --> 01:04:30.980
 all of them.

01:04:30.980 --> 01:04:31.980
 Wow.

01:04:31.980 --> 01:04:32.980
 Yeah.

01:04:32.980 --> 01:04:35.420
 Like I said, we have some very exciting things planned.

01:04:35.420 --> 01:04:39.180
 Do you have training for customers?

01:04:39.180 --> 01:04:42.780
 I promise this one is very, very user-friendly, very intuitive.

01:04:42.780 --> 01:04:49.580
 I'll be excited for you guys to get to see it soon.

01:04:49.580 --> 01:04:50.580
 Yeah.

01:04:50.580 --> 01:04:51.580
 And your metrics are amazing.

01:04:51.580 --> 01:04:52.580
 Thank you.

01:04:52.580 --> 01:04:53.580
 We are very proud of them.

01:04:53.580 --> 01:04:54.580
 Any other questions?

01:04:54.580 --> 01:04:55.580
 All right.

01:04:55.580 --> 01:04:56.580
 Thank you.

01:04:56.580 --> 01:04:57.580
 Thank you.

01:04:57.580 --> 01:04:58.580
 And that is it.

01:04:58.580 --> 01:04:59.580
 Correct?

01:04:59.580 --> 01:05:00.580
 All right.

01:05:00.580 --> 01:05:01.580
 Okay.

01:05:01.580 --> 01:05:07.340
 It is 10.05.

01:05:07.340 --> 01:05:09.140
 Do we have emotion to adjourn?

01:05:09.140 --> 01:05:10.140
 So moved.

01:05:10.140 --> 01:05:11.140
 There you go.

01:05:11.140 --> 01:05:11.140
 Adjourned.