May 22, 2018 City Council on 2018-05-22 1:00 PM

[ Pause ] >> All right. Welcome everybody to this meeting of the Dent on City Council on Tuesday, May the 22nd, 2018. It is 1.05. I apologize for being late and getting started five minutes late. We'll move on through our agenda items. First item on the agenda is consent comments on consent agenda items. Citizen comments. Do we have any citizen comments on consent agenda items? Seeing none there. I wanted to welcome you Council Member Meltzer to your first council meeting. So welcome. >> Thank you. >> Request for clarification on agenda items listed on the agenda for May 22nd, 2018. Yes. >> I'd like to pull out item I so I can recuse. >> All right. And you have the paperwork? >> No. >> Okay. All right. Fantastic. So we're pulling I. [ Pause ] Okay. Any other clarifications on the agenda? Okay. Make sure run through, make sure I didn't have any questions. Yeah. No. Okay. We'll move on to our next agenda item then which are our work session reports. Work session 3A is receive report and hold the discussion and give staff direction regarding current City of Denton facilities including but not limited to City Hall, City Hall East, development services and the service center and how to proceed with planning for future needs. >> Good afternoon, Mayor, members of council. My name is Mark Nelson, Director of Transportation. And as stated I'm going to visit with you a little bit this afternoon about the facilities master plan in specific. A few of our facilities to include the City Hall, City Hall East as well as the service center and some lease property that we have now which is the DATCU or the development service center. I'm going to walk through the first part of this presentation and then Kelly Morgan with Nelson Morgan architects is going to pick up about midway through and walk through and kind of move through in detail on some of the different options that we have presented here. So with that quick overview again we'll hit the history of how we got to where we are at this point in time, talk a little bit about the facility issues, goals and objectives, what we use to try and define or otherwise help scope or create our options. And then walking through those options as I mentioned just a moment ago, Kelly will walk you through in some detail on that. Excuse me. And then certainly we would like some staff would like direction and maybe outline some next steps as to where we go from this point. So with that, just really kind of bring folks up to history on this. In 2003 we had a master plan that was completed by HOK. And certainly a couple of important outcomes from that particular master plan was that it suggested a one stop shop, a creation of a core municipal facility with centralized operations where folks could that are doing business with the city. They go to one single location where there's to pay a utility bill, interface with planning and development or work with engineering from the development side. In addition to that, one of the other key aspects of that particular master plan study was the suggestion or recommendation to move forward with a justice center. And so you'll see that theme as we walk through these particular options. So in 2016 we moved forward with engaging Nelson Morgan architects to revamp or take a look at that HOK study using that HOK study as a baseline. We provided in the fall of 2017, I'm sorry, fall of 2016, a recommendation, which is actually included in this backup material in the presentation that you'll see and that is option one, which is just next door on some property that was acquired from the county, potentially for the construction of a city hall annex or expansion. There's some different change in administration and some additional direction staff and the consultant went back through in the summer of 2017 to revise those numbers, look at some staff efficiencies, workplace efficiencies and essentially brought forward then in April of this year, a revised facility that had a little bit smaller footprint than what was presented in 2016. And actually was an addition to the existing facility and that's going to be option two as we move forward. As part of that presentation then in April this year, we were requested from counsel to take a look at a couple of different options because some of the concerns with the impact of the architectural integrity or hysterical value of this O'Neill Ford facility building. So, we've talked about this in the past, our facilities are a little long in the tooth. You know, in some cases, 70 years old we're coming up on 100 years old with our, with our City Hall West so that we 're no longer in there. We vacated that and in favor of moving into some lease facility so that's one of the concerns that we'd like to move out of that. That lease facility for development services. And then really at the core of this is, how can we provide better service to the customers to the citizens and that would be enhancing or bringing together that one stop shop so we centralize those core functions that interface with the public in that one stop shop. And then in each of the different facilities there are some parking challenges. So what are the goals and objectives again we've talked mentioned the time and again on the one stop shop I think that's clearly one of our top goals. Also looking at those workplace efficiencies how can we, how can we create better collaborative workspace when we have staff at one facility that interfaces with staff at another facility. Oftentimes it's not very efficient and sometimes the communication breakdown is just the nature of what happens there. So we'd like to create an atmosphere that would be beneficial to workplace collaboration and then transition we mentioned that earlier transition of the city hall east to a, or creation of a justice center and therefore looking at the transition of city hall east to the justice center. There's been some enhancements there with respect to the police fire training facility that really kind of makes sense for that particular facility to then transition into the justice center with the relocation of some of the staff and operations out of that particular facility. And again, trying to move out of that least facility over at the development services currently occupied. This particular graphic really just kind of gives an illustration of what, what, what the centralized or this one stop shop may look like some of the different operations that that would be recommended to pull together into that municipal campus or single facility. Very quickly, you may recall this from a previous presentation it was a more dynamic slide we've got this as a static slide but customer service parks and rec administration, human resources and risk management and then community development would move out of city hall east to a central location. If this is the location that it would be. If this particular location would be supported, and then coming from the development service side would be building inspections development services. Gas well inspections and fire prevention. In addition to those coming out of the DATCU facility, we look to move some folks out of engineering, again to interface with the development services and building inspections, and then in each of these options we talk about an EOC a hardened emergency operations center. So, this is a quick summation of the options that we've looked at again and talked a little bit about option one which would be essentially just adjacent here across the parking lot. Just to the east southeast of this particular building. And that was the option that was presented. Of course we've revised it to current numbers in terms of spatial studies and FTE projections. Option two was what was the option that was presented earlier this year in April, and it was more or less an addition or a wing to the existing facility. And, and it is one of the more economical options that's out there. Option three is just south of the civic center in the parking lot. Option four and option for be or across the street at Bell and McKinney. There's some commercial property there that may need to be acquired to make that happen. The core difference between those one would be option four would have a surface parking lot and option for be would have a parking structure to get some efficiencies in terms of additional parking that may be required. Option four was the last option that we took a look at as requested from council and that was a location just south of our facilities management over on Woodrow Lane and so each of these have the basic square footage here in the summation of what it would look like in the 2036 projection . In terms of a need for FTE and then of course the price range. So at this point in time I'm going to turn it over to Kelly Morgan with Kelly Morgan with Nelson Morgan architects and allow him to walk through each of these particular options and a little more detail with you. And then I'll come back up and we'll talk a little bit about some of the financial components associated with that . Mayor members of the council I'm Kelly Morgan with Nelson Morgan architects. How's everyone doing today. Good. So far so good. All right. So last time we spoke about some of the options and we came back to give some more options. Basically what you're looking at here is option one, what we refer to as option one. This is the one that we presented back in November of 2016. We did reduce the square footage some from the November 2016 version because we updated it for the current space allocations that we're using today. So the square footage is a little less. Some of the advantages of this one is that it does not affect the architectural integrity of this existing City Hall and that's one of the goals that that we need to provide. We did add some parking to the south of McKinney Street and then some additional parking on the north side of McKinney Street to supplement the parking that's required. And if we look at let me. It's a lot of numbers. Let me go through this real quick to kind of explain the difference between construction cost and project cost. So the difference is in construction costs. That's what you typically see if someone, the contractor says what's the square footage cost or what's the total construction cost. That's basically everything that the contractor builds a building the site. Those items. When we talk about project costs. That's the total project, including the construction costs plus any fees. Geotechnical services. FF&E. It includes all of those any land acquisition. Those are rolled everything that you would pay for a project becomes the project costs. So that's the difference between the cost. Now on cost one. If you look at the bold up there on the top there the construction costs would be 36 to 41 million dollars. And then parking would be an additional 940. So the total project costs for option one would be 49 to 56 million. And then we were tasked with going or take this project to 2036, which we did, which would add additional 36 full time employees, which added nine basically 10,000 square feet, which added another 5.8 million dollars. So the total project costs for 2036 on option one would be 55 to 62 million. I'm sorry. I got a question. So on the 2036 additional square footage. That is space that in this proposal is it built as a shell or is this new. I mean, what is that figure. The 9708 square feet. That's the total square foot that would be needed for 36 FD s. It could be shell space. Sure. Okay, so that does that include, I guess, is that construction costs or project costs that 5.8 million. The 5.8 million would be, we'd have to add a little bit more into there for parking. But that is basically the project costs for that. So that that's about if it's 10,000 feet 5.8 million as if my math is right. Is that about $580 a square foot. Correct. Okay. Yes. All right. So that would be your project costs, not your construction costs. Okay. All right. Okay. That is so you said we got to add a little bit to parking. On a couple of the options we do. I think we just want the 9708. Is that is that is that 5.8 45 million. Is that what you're anticipating construction costs or is that all in. If you've added parking into it, your number. Okay. Yes. Yes. Yes. Yes, Councilmember Melzer. I have a question for the city manager. As I recall, last time this was discussed, you expressed some doubt about the FTE projections, given that your strategy calls for more efficiency and delivering services. And is this adjusted to reflect a more conservative outlook or is this still, you know, high. Yeah, I think I think the question last time was this was up is whether or not we had taken into consideration additional FTEs. It might be needed as we continue to grow by 2036. Our population is projected to be roughly around 200,000. So what we did was went back and took a look at all of our various operations and feel over the next 20 years, it would be feasible to add that many employees. I would I would still tend to question whether 36 is going to be the complete everything that's going to be needed, given where we're seeing technology going. We've really been emphasizing frontline staff lately has been in the fields, particularly with police, fire, frontline. So I think the numbers defensible. I think the way that our business changes, I'm not quite sure that I see 36 needed in 20 years as we continue to get more efficient with technology, particularly in building services, finance, that sort of thing. But there's always going to be a need for folks to staff that one stop shop. If I can just follow up. Yes. So, so anything then in your mind, this would allow a little a little cushion. Coming short, it will allow a little cushion I think where the mayor is going is probably more reflective of where our thoughts were at the time was should this be calculated as shell space that could eventually be built out if needed, or should it be built out office space and I think that's where he's going at. I don't think it's a bad exercise to go through. I'm still not sure in order to get the project off the ground if it doesn't make sense to simply build what we see we need the next five or 10 years and then look at any additions down the road I'm getting a little bit concerned with the impact on the rate so as we work through these slides. Yes, customer. A couple of things to keep in mind in that line is that this building is 50 years old. And this building was built, and they decided to save money . So they didn't build the extra two stories above it. And while we're told that engineering would allow that to happen. It would be so disruptive to the operations in this building that it's not possible. I think that the notion of constructing a building that's going to last past 20 years since we tend to use our buildings more than that would be wise, and to build out the space now so that we don't come into the situation, creating a situation for folks 20 years from now saying, We're going to build extra floors but it's too disruptive to build them we have to do something else. So I talked about some of the pros and cons of option one. Some of the pros again was the. Basically, we're not disrupting the existing city hall and that was an important point. But the one thing that is some of the cons, it will be detached. There'll be a little bit of distance between them. Someone comes in they may get some confused about which building, but I think it can be designed in a way that would complement the existing structure not detract from the existing structure. And then again we just have to look at the floodplain constraints and some of the other options there so. Real quick question on that last slide. I'm not reading something right on your on your option one sort of summary you have new square footage of 94,000 existing of 24 total of 118 204. Is that including the, that's including the 9700. Correct. Yes, the new square footage. Okay, is the 84 plus the gotcha. Yep. All right. The third, the 2036 numbers. Thank you. Thank you for that clarification. Okay. So option two is the option that we presented back in April . And this was the basically building the new city hall annex on the southeast side of the existing city hall. We again would add some additional parking north of McKin ney we would add some parking south of McKinney. We still add the hundred and 70 parking down there. We would reuse this option reuses the existing city hall to the maximum capacity. We would reuse the existing council chamber for probably the work session space. We'd really get to use more the square footage so we could reduce some of the new construction costs. So we felt like this was a good option in order to basically this would be probably the most financially feasible option to do, or the least costly option may not be the best option. But it's a. It does take of all the option it does take the existing city hall and maximizes use of that space. And if we look at the construction costs or the total project costs for 2026 this one ran from 45 to 51 million. We added additional 8600 square feet we didn't have to add as much square footage because we're using more of the existing city hall square footage so the 2036 adjusted project costs came out to 50 to 56.7 on this option. Go ahead customer breaks. I have a question about design if you could go back to the slide. I think it was on the first one to the interior yellow line without the square footage. Is that an external is that a walkway like here. Yes, that would be that would actually be an interior walk way we would enclose that so it would connect the two structures, but it would be designed to complement what's here. Okay, thank you. So I have a real quick question when you talk about Max that this option, quote unquote maximizes the use of current city hall. So, just real briefly what between option one and two, where's the difference in the maximization in other words, what are we, how are we doing it in option to that we're unable to do it in option one, mainly the council in the council chambers and the work session spaces will be the only addition so in option one, we would build a separate council chambers we build a separate work session room we wouldn't utilize. We would utilize the existing council chambers but not for probably when we use for council. So an option to you're saying we'd still use this as the work session room and still that is no we would use this as additional office space, we would take the works work session room, we would move it to what's currently the council room. And so if you look right here this, this would become the new work session room. And then we would have the council in this area to complement that work session room. So we're able to use this for more office space. Whereas in option one, we're going to have to use a new work session room and a new council. Okay. All right. Which what we are right now is what, 50 years old or 40 years old or something like that so okay so that's the, that's the main difference is the space for the council meeting space, and then the work session space. Correct. All right. But in option one, you still can utilize these spaces for office spaces that you might have to put it I mean in other words I just, there's got to be more growth. Okay, for office space. Okay. Okay, so one of the cons that we had talked about last time was the possible impact of the architectural integrity of the existing city hall so this particular option would have to be sensitive to that in the design of the new annex. So that's one of the most important things that this one would have to look at just keeping the integrity of this structure. And with the new structure. Yes, Councilmember Hudson. Can you understand that last point, why is that a con. Why is that a con. Yes, what are the steps that the architect well I know there's been some concerns that if we attach to this building, then that's going to affect the architecture of the new building. It's going to affect this existing structure the way it was intended. But I think we can add on to it in a way that would complement the structure. So I'm just saying that whoever designs the addition has to just take that into account. So it complements and doesn't take away from the structure. Okay, thank you. Okay, so the next three options were our new options. So this option three would be built south of the existing Civic Center. You we would keep the existing city hall, of course, we would maintain the integrity of that because we won't be building up against it or attaching to it. We would add some additional parking on the north side of McKinney and some additional parking on the south side of McKinney. Now this particular option does have an existing sewer line that runs through the existing city hall parking lot. So that would have to be taken into account. And the park property would would be taken to would be in a factor on this one. So if we go to our cost, the sewer relocation for that we 've plugged in about $150,000 for that. And then so that brought our construction costs to 36 to 42 million. We've got for the total project cost 49 to 56.8. And then for the 2036 costs, 55 to 62.7 million. But we do have to go back to the previous slide. So currently, there's an existing sewer line that runs through here. And so we would have to relocate that. The other disadvantage of this is that we're taking away the parking just on the south side of the Civic Center. So the parking wouldn't be as close to access the Civic Center. Plus, it takes in a lot of the north green space area for parking. Any questions on this option? It looks like it's sort of a similar amount as to option one. It's just sort of a different I mean, a little bit higher, just a little different configuration. Correct. And when you say park property, does that mean my understanding is that if you're going to I guess it's if you're going to sell park property, you have to have a vote . But if we're going to use it as a city, we don't have to do that. There would have to be a public hearing. Okay. But it wouldn't have to go to the voters. Okay. Thank you. Yes, Councilmember Gregory. Would this location present a similar concern as raised by option two in that the proposal for the location of City Hall would be blocking a view of the existing Civic Center, realizing that the Civic Center and the existing City Hall were both built at the same time, designed by the same architect with the same vernacular, the same aesthetic. And that the Emily Fowler Library was was rebuilt to match that same. I don't know what you call it. Right. The same design. Right. Elements. So wouldn't that sort of hide the Civic Center and push parking for people who are using the Civic Center further away. Correct. That would be that would be one of the factors in or a con in this particular option. And I'm assuming that we still if we wanted to pursue this very far I think it would be interesting and important to know how frequently the Civic Center is still being used. It seems to me it's still being used quite a bit. I would I think that would be important to know if we were going to make it more inconvenient for those folks to use it. Okay, so the cost for option three of the 2026. I think I went over this the total project cost for 2036 would be 55.7 to 62.7. And the only additional cost this one would incur would be the relocation of the sewer line. If we go to option for this is on the southwest corner of Bell and McKinney. We would add some additional parking on the north side of McKinney, we would add the parking on the south side of McK inney. This would this option would be further away from the existing City Hall. So the distance between the two and the safety factor of going across McKinney Street accessing existing City Hall and New City Hall would be a disadvantage for this particular option. Does this option doesn't like in the last option doesn't affect the view of the Civic Center. So that would wouldn't affect that. Plus, it would maintain the integrity of the existing City Hall because the City Hall would remain as it is right now. Councilmember. In that particular option you're suggesting adding 64 spaces between the current City Hall parking lot in the Civic Center parking lot. Basically where the old county jail. Are you doing that because you're anticipating that that parking will be needed in order to accommodate all of the people that are working here, and those that are customers or those that are visiting, or is that just designed as bonus parking. This designed to meet the parking that's needed for the employees. Okay, thank you. That would be needed to to for the new structure. Thank you. It's not a bonus. Okay, so option for construction or project costs for 2026 was 54 to 61. In the 2036 adjusted project costs is 59 to 66. Now, one one thing I might point out back on this one is in order to put this here we've got to have some land acquisition of about $4.8 million. There's some environmental cleanup costs that would also go along with this particular option so that's why some of the costs went up on on this one because of those land acquisition costs demolition costs, and the environmental remediation that's required. So if you look at these top numbers up here land acquisition was about $4.4 million. The environmental remed iation be about $350,000 and that would include the gas station plus the cleaner, and then the demolition would be another $150,000 to clean that up so that was the additional costs for this particular option. Plus I might point out the longer project schedule. So to acquire the property to get the environmental cleanup that 's going to take longer to for this project as well. So we have an option for be which is identical to option for with the exception of we put a parking garage on the south side of McKinney Street. So on the north side. The north side pretty much remains as it is today. We didn 't add any additional parking. We didn't add any additional square feet. All of the construction was done, and the parking would be on the south side of McKinney Street. Question. Yes, because we're very, thank you, Mayor, do under option for be. Do we need those 23 spaces directly north. And that small parking lot, even further north. Those are presently here but we would not need that you don 't need those in order to meet any kind of required not with the parking garage. Okay, thank you. Those are currently here I mean we could we could get rid of those and make that more green space. Okay, so those are not needed. So if we look at the costs on that, we still have the land acquisition the environmental remediation and the demol ition costs. And then the additional parking costs for a parking garage would add another basically $7.3 million to add the parking garage. So this particular option is 68.7 to 75.7. One of the other things I point out on this one is the distance between and same thing with option for you have all most of your structures on the south side of McKinney Street. We still have some offices on the north side of McKinney Street in the existing City Hall. So just that break between the two structures and deciding, you know, the safety factor of crossing McKinney Street comes into play on this one as well. Yes, Mr. Meltzer. Is it your view that construction of a parking garage only makes sense in a scenario where it's adjacent to the new City Hall structure, not a parking garage, even in that same spot, still make sense as part of the development. I think you could make sense if it's done correctly. Sure. I don't think that it has to be adjacent to. Okay. Yeah. So then option five, we said, okay, what if we just take City Hall and all of the functions and move it out on the east side of South Woodrow Lane, which would be south of the facilities management facility, where in this case, it would be a completely new structure. Obviously, it wouldn't affect the existing City Hall, all of this would remain as it is, but we would take all of the functions of City Hall out to this new site. So in other words, the square footage would would go up a little bit on the initial construction of this one, we would have to build all new parking, so we wouldn't be able to use any of the existing parking that's built on on this site. So this would be all new construction, all new parking. One of the advantages of this particular option is you wouldn't be constrained to the design of the existing City Hall, you can design it however you want it to design the City Hall. Councilmember Briggs, I believe he has a question. Is that a gas well? Yes. And do you know how far away the gas well is from the proposed City Hall. I think it's further than the square footage allowed to build. Now I don't know exactly how far that is, but I can find out how far it is. But I think it's further than what's needed. It would be something to look into definitely for this option. Okay, so the construction costs again on this option we would have some land acquisition, approximately $3.8 million to buy up the additional land needed. The project cost for 2026 was 59 to 66 and then if we take it to 2036 it'd be 66 to 73 million on this particular option. One of the other cons that I might mention is that it does remove the municipal presence from the downtown area. So if we look at the summary again, for all the different options, as Mark talked about, it ranges from basically 50 million on up to 75 million depending on which option we choose. And as Paul said, we can take the parking garage and use it on either side with any option. It doesn't have to be adjacent to that. At this point, I'm going to, if there's not any other questions, I've got a question. Okay. If you could go back to slide to option one option one. Yeah, because you talked about I want to make sure I understand. You said option to better utilizes all the space and option one, i.e. the council chambers and the current work session . Right. Is that, is that my understanding. Correct. So then, thinking that all right so an option one, you say one or two I'm sorry. Well, what I understand that you said or what I thought I heard you say was an option to it better utilizes all of the space, more so than an option one, i.e. an option one. This space and the council room space is sort of, quote unquote future use in other words, it's not correct. It's not directly plan to be occupied from day one. Yes. So then, if this is this capacity and option one, this room and the council chamber is sort of. I'm gonna say a built in capacity yeah you got to remodel you got to do something with the council chambers and all that. But if we're thinking about 9700 extra square feet for 36 employees. Why would this space if it was, if it was not being utilized at the time of build out. Why would this space not be considered. If we needed it. That potential space. Why are we adding another 97. We're not trying to use this square footage, but we're again we're trying to get the different departments in the same location. In other words, we're trying to group the, the departments together to create that one stop shop. We have like an option one if we have more over here, and we could do that initially but if we have more over here, then if someone's come into the site well they may have to come over here for one purpose they may have to go to the new structure for another. So that we can have that one stop shop and that's more of the reason why there's that additional square footage here in the option one. Okay, well, yes we could use the more but it would just be more disoriented. I mean, obviously, the one stop shop is a is a is a goal and it's one that we've had as a primary goal for a long time. I think you have to also have to monetize that. I mean if you're saying, you know, we're not going to use this space because we're going to keep all these people over here, but it's going to cost us an extra $6 million but when it's literally right next door. I think those are discussions that so for me, option one I 'm just taking off the 90 the $5.8 million, because even if we needed it. I think if we haven't if we're in the original options this space is not being utilized initially . If those 36 employees are going to show up all of a sudden all at once, correct, then. Yeah, I'd be hard pressed to say that we should spend $6 million to build new space when we already have space. I mean that that. That's just me. Okay, that's helpful. I appreciate that. Yes, Councilmember Meltzer. I'm going to go to option one. Is there anything that would prevent us from making some kind of an indoor connection where they're so close. No, we could make this, this could become an indoor connecting link. Yes, looks like it's six feet apart or something. Yeah, this could definitely build a connecting link between the two. Because we just have to be sensitive to the integrity of this design so which is easy enough to do. So I am, I'm not in favor of option five. It puts staff in harm's way by being close to gas well. I don't prefer for and for be. But I would like to hear from our historical preservation officer Roman on I mean if that's okay with Council on on this option in the, the second option where the new structure is wrapped around the existing building. And if that affects the historical aspect of this just if that's okay with Council. Absolutely. On on his thoughts. Thank you. Thank you. So, I said there was something in your packet I don't know if you all had an opportunity to look at it. And I realized when I did that I what I should have done instead was to provide you the literature that I take that from so when we talk about the United States Secretary interior standards which people hear about all the time that memo I wrote was extracted from what you see in there and I brought copies for everyone if you want to look at them. So I would I should have given you the opportunity to look and consider those rules because really all you're considering is Mr Nelson has looked at is how the connection is made, and is in does the connection. You could say defer or is it an appropriate connection. Sometimes the connection is referred to as a hyphen. So if you see the one historic building here, and there could be a modern glass connector piece and then the other building here. So, both option one and two can are similar in my mind as a preservation person because depending how the connection happens, you still have the integrity of this building. And option one and two is when we went in the principles in historic preservation and in the standards really are also meant to just make good common sense decisions about our buildings and so they also entail some sustainability to them. So one of the principles of historic buildings when you have something for example in the National Register, and you're applying for tax credits, their favorite thing is that you're returning that building to its original use or your programming in a way that is similar to his, so that way that the interior doesn't have to change very much so having the two buildings close by where we can program this existing structure in some way still related to city administration. That's a very good thing. So both of those again look would can be fine and it's just that critical eye. And we're fortunate in that you know descendants of O'Neill Ford's firm are still in Texas, you know I'm not saying anything about how this goes out and the final design is actually made but Mr Powell and Mr Carson are still with us and they were contemporaries of O'Neill Ford and they're very familiar with his work and many many very good architects are familiar with his work because he really is almost legendary in Texas architecture, he was, he was hired by the best of the best and so I said in that memo that we're really fortunate that he kind of adopted Denton as his hometown, and he was here to help on it so it is a very important building. Okay. Any other questions. I appreciate that. Thank you so much so as long as this existing structure, the integrity of it is, is okay and not messed with the external part, everything should be fine so does this building since we're keeping it. Of the same use, will it qualify for tax credits. We've never talked about tax credits I think is a city in this regard municipalities though. Is that something that's right. Okay, municipalities don't normally qualify for that . And by the way I extracted from the 200 and something page standards. 12 pages there's just 12 pages of those standards that deal with that connection, the connection. And I think it would be here to just if you really want to, as we move forward to maybe consider those and think for yourselves of how that connection looks to the existing building because it'll, it's, it's there, they're written for anyone, you know they're written to be understood by, by the, by the people. So, so why, anybody. So a follow up to that. So, would, would this logic be sort of natural if it's not then let me know. So we've got to go by a certain set of standards that it's critical and how you make that connection and to tie it in and, you know, you find the consultants or whoever that can help us do that. So if you have a smaller footprint of connection. So let's just like here's option one. And so, could you make it to where it's connected to that building somehow, you know, maybe a small walkway whatever the dimensions need to be for a hallway or something like that, or in the, in the, as represented in option to your you're wrapped up against it you're up against it and so your, your compatibility will be more challenging I would suspect with option to them with option one because you're, you're disturbing less of the external facade in option one is that is that a reasonable kind of deduction. So option to being the one that's sort of in front of city hall between city between I'm sorry between the chambers and McKinney option. Yeah, what's right it's up against it as far as right there sort of wrapped around it so I can tell that there's a, there's a lot more of the external wall space that's impacted and courtyard, as well. In this in the option to then if you had option one with just that sort of enclosed walkway spaces. It's about that, in my mind, and, and this is where you kind of. It's that connect that connection for example the piece that's in front of the chambers right there between the chambers and McKinney. If that were glass or transparent enough, even that whole west facing there, and that if that connection is distinguished enough. Right. And it could be done, or this or something similar could be done I think it's, you might have to work with it a little bit more manipulated a little bit more but you could have a connection maybe not profound maybe it's scooches over just a little bit. And then you're still seeing this elevation but I think the critical character defining element of this is this landscape right here out in front, and the courtyard and the trees, and the porosity of it you know, O'Neill for didn't like grand buildings he hated, I am pay city hall in Dallas, and he didn't, it wasn't about that they shouldn't important things don't happen important things do happen there, and he meant for this building to be look approachable from all sides. And so, we kind of have to look a little more closely at that design philosophy. Mr. Nelson I'm sure knows more about it than I, he's probably already forgotten more than I'll ever know, but I think what I heard you say was yes, option to, then there is more challenges and to, and more detail that needs to be taken into consideration than if you had option one where you're just connecting a hallway and you have less of that disturbance to try to accommodate for. Yes. Did you have a question customer breeze and then customer Ryan did you have a question okay I'm sorry you got. So I just wanted to say that I was in favor of option one, because I'm okay with work sessions being in the current council chambers. It's fine. I think in option one I think the work sessions and council would be in the new building. Yeah, yeah. Oh, I'm sorry you need to get behind the mic I'm sorry. Yes . Yeah. Yes, option to is the option that would take the existing work session space and use the existing council space option one would would have a new council space. Okay, so option to has. I thought option one was smaller. Is it not. No, option one is larger. Let me go back to that real quick. Well for me keeping the integrity of this building and not blocking it from view is is pretty important. So, customer right of the options presented I think option one is the one that I prefer the most. I'd like to know, because we're adding 50 parking places right there in the green space out front of city hall. I brought up about a sky bridge and a possibility of doing a parking garage on the other side that we've long talked about whether we need additional parking for downtown I think if you kind of combine those two over adding downtown parking on that lot that's 170 increase a lot, increase that to skybridge across, you're not impacting that green space in front of have we, because I know that the dealing with the federal government is generally very difficult to get any answers have we had any conversations. I know that they've downsize in many areas. If they're considering downsizing and didn't is the existing post office. Anything that could possibly work for us. We'd actually checked into that about a year ago after I started and there was no plans to vacate that at this point , and from their perspective, it was business as usual. Yes, customer. Yeah, I concur that, you know, until we find out where the money comes from for all this, just looking at the merits as presented. I lean to option one with a connector with your modification mayor that may not need the extra space. And with the parking consideration that the Councilmember Ryan just referred to. Was that a parking garage. Yes. And that was what 7.8 million 7.3 million 7.3. And that's without a quote unquote skybridge correct. Yes, and I'm just kind of thinking in terms of we've had a lot of requests from the public on a downtown parking structure and this kind of handles to two birds with one stone, so to speak. I think it's one of the better ways to go about that. I love the skybridge I've been saying that forever. I mean when you go down to Fort Worth and you see it coming from parking garages over to the main buildings. I don't know how tall this is going to be but also it then it's just a matter of you know, the, the financing of it because that's adding probably another. And with that I would think it's that's gonna be a million dollars, you know some type of skybridge or half a million. So you're looking at another probably eight and a half to $ 9 million on top of the cost here. And if you're going to build a parking garage across the key now if you're gonna build a parking if you're going to go to that expense you might as well. I mean it'd be quite impressive to be driving downtown. Of course I don't know all the engineering and height and FAA or whoever governs the air. I don't know. That's not gonna be that call. Sure. Yeah. Okay, and I certainly can go with option one I like that sort of add on idea. I think it's just as anything it comes down to how you're gonna pay for it how you gonna finance it. You know the voters going to prove it and things such as that so. Councilmember husband you look like you're just just really want to make some comments over there. He's got four more options in mind. I think I'm tracking with. I have a different option. But I am talking to people I think, for me, it became the use right so our citizens and how they interact with this building. The gross majority don't come into this building, generally, right, and even contractors are doing more online so then the question becomes, how do they interact and I think it's more exterior I think it 's more so that's kind of what drives my consideration so I think location is spot on still in this area which is a big transition for me, but I do think how we move that next phase of kind of how comprehensively we start to shape our downtown and look blocks out and kind of how that merges will be supremely important that we have some sort of master plan to go coinc ide with with this new development to make sure it kind of f osters grow looks a certain way that sort of thing so that's kind of my transition, I tell you I will absolutely struggle with a pedestrian bridge, if we don't put a bridge over this creek out here, you know because it makes no sense. This gets used more than the parking structure and if the parking structures getting used in its totality it's probably because there's an event over here. If they're downtown going the other way then they don't have to cross McKinney in the sky bridge doesn't come into play so to put a sky bridge over McKinney for occasions when it's full versus. Sure. Oh, is Creek that gets used all the time that no one here we're at Stone Bridge that we, we run a million people across over three, three days that just. So, what what event is that that's arts and. A million. Okay. Clicker. That's a big clicker. So, so that's my, and so I'd want to make sure, as we go forward I mean, so again option one is good with me I'm good with the, with the, with the parking structure. And then Romans notes right we need to drop the 50 parking spots in front, because he says that affects the green space in front of the building which then could affect that 's just I took that from the notes correct me if I'm wrong. Okay, yeah. And is that 50 required. I mean is that part of the parking requirement. Yes. Okay. But if we build a parking garage then that requirement. Yeah. So you have two options you could you could build a parking garage, or you'd have to to acquire more property on the south side of McKinney, which in that case, the cost is going to be about as much as a parking garage so that's your other option is do surface parking on the south side of McKinney but you have to acquire more land to do that. Okay. Yes, customer breaks will it still be required under the revised parking ordinance. Yeah, but I think I'm parking you got to consider that. Well, employees might bike in you're closer to town so that you know that you keep as we grow where those people live, and then we've got the new parking lot behind the old city hall west and maybe if you park there as an employee you get an extra 10 bucks for a month or something I you know something some way to incentivize that you're not parking right, right, right next to your building or across street from building. customer. Gregory did you have a question. Yeah. When I looked at all these options what I keep trying to figure out is how do we get more green space. And, and it's only the option where we move out to Woodrow that we capture more green space for the downtown and in the long run, we want that. There was a master plan for quicker town park, where we were acquiring property on the west and north sides of Oakland, to try to expand that part. I'm not sure that any of that is economically feasible, but I can tell you, as we continue to grow and the density of the downtown grows. The folks downtown are going to need that green space, whether option one. In the long run to do it. I had occasion several years ago there were a group of architects around Texas that came here to denton. And the goal was to look at O'Neill Ford buildings, because I'm old they asked me to come and speak about it. And all of the architects got very very there, this great silence came over the room. When I said, I love this building, but it's probably a bad idea to have a public building where there's no front door. Now just went, you know, like, how dare you, I mean, you know, O'Neill Ford. Well he, he made a mistake when he designed this. There needs to be a clear front door. People need to know how to get into the building. And I can't, and I'm not here that often. But I'm here often enough that I'll run into people to say, where do you go, how do you get in here. So, hopefully, the new city hall design. If we go with option one and I'm leaning that way also, not that it matters, but it needs to be built in a way that complements the, the, the only for design the elements, the colors and all that. And it needs to have a front door. Questions for the architect will move on to the very fun part of the financing but yes Councilmember husband. For consideration, I would ask staff to keep a pulse on NCT C development because understanding that doesn't apply to our parking spaces, but it meets a need downtown, which would then not burden us to try to meet that need. At some point we'll be duplicating efforts. Show us the money. Tony went to the director finance. Never good when people laugh before finance gets up here. What we've done here is just kind of walk you through this slide, giving you a couple of different scenarios for these various options and will also give you kind of a range of what the potential tax implication is and I have another small little spreadsheet that I want to put up here for you to look at. So what we've done here is we've assumed a. Do you have a question already. Well, I just noticed that the project costs for 2026 isn't up there as an option. And that's kind of where I was leaning as well, which one for 49. Oh, you're saying to take off the, the additional square footage. Yeah, so this is this. So, what, what, that's a great question. So, your costs are based upon the total cost which includes adding that additional square footage for those 36 employees that's. Yes. Okay. So we've done here is we're giving you a couple snare. Yes, just just remember that. You're taking off for the square footage, but you're possibly adding on for parking garage. So, no, no, no, I'm just trying to clarify for Councilmember breaks that wasn't necessarily mine. I was just trying to make sure we understood what we're seeing here and that that's why it's this way instead of the cost that she had asked for. Correct. So, so on the options that were that were given to you in the previous slide. So what we've done is we've taken the maximum range to at least give you an idea of where, where we might land we've given you two scenarios where we issue 20 year debt versus 30 year debt. We've included the assumptions down here at the bottom, based on kind of current market. We're looking at a four and a half percent interest rate on 20 year bonds, 4.8% on 30 year bonds. We've tried to layer and in a stair step, the design money that would come in in year one and then year three would come the bulk of of the bonds for construction. And for each one of these, those very, those very, you have designed and no land acquisition with for about one and a half million to as high as 5.5 million that includes land acquisition on one of these scenarios. Well, you have here is what the average annual debt service principal interest would be for each one of the scenarios, what the total cost would be to service that dad again we 've not included or assume that these bonds would be refin anced at some point for interest savings but generally, we put in a call provision 10 years into that issuance and we 'd look at, at that point to potentially refund them for some interest savings. And so the ranges that you have here, just to just to point out option one, you're looking at total principal and interest of 95 million. Again, that's that assumes a 20 year term up to 118 million on a on a 30 year term. So, on a 30 year term you're certainly looking at a lower annual debt service payment but certainly over a longer period of time, and that those are the differences that that you see here. A couple of things that that I'll, I'll point out. The projects that would be funded outside of those that the council has already approved through the 2014 bond program and in normal plan CEO issuances that we have on an annual basis and so no other projects have been layered in this forecast. Yes, because we're. If we decided that we needed the parking garage. Are we able to use the downtown tip funds to do that and fund that separately. Certainly I think that that could be an allowable use, you know part of this forecast assumes that this is going to be 100% debt funded that one does not assume any leveraging of other funds. Certainly we'd be looking at that as we go through the budget process. Yes, Councilmember Melton. Is any aspect of this budgeted anywhere is this entirely is everything we're looking at entirely incremental to your plans so far, it's brand new it's not included in our current forecasting or the current budget. And the currency IP. Yes, and how much incremental debt capacity do we have before affecting our bond rating. In our opinion, we just went through a bond rating. We submitted that information to you recently. Understand that by state law we are capped at $1.50 for debt service we're currently at about 20 cents. So there's certainly ample debt capacity there from a purely state law standpoint. As far as our what I asked actually as as far as our debt policy we do have an affordability affordability statement that we have in our policy that does limit us to no more than 30% on annual debt service we're currently at about 17 % so there's kind of ample capacity there. We don't believe that that this particular project. If it's funded would have an adverse impact on our current bond rating. We think that, you know, certainly as we're looking for a future bond program we would have to look at what that amount would be potentially lower that in the future. Those are all that's all information that we've already provided to the bond rating agencies they're aware of our future plans. And so again this would probably just go into that assumptions, it would be a deferral of some future bond program potentially or limitation of some future bond program, unless it's incorporated in a bond program. So, so, shouldn't shouldn't we then, assuming that there is some limit right in terms of our total debt capacity that we can do and this doesn't push against it, but that, you know, as you said it might affect something we consider in terms of another bond program in the future. So shouldn't we be looking at this in the context of our, you know, our total, our total debt needs right there's ultimately it's not just this in isolation is it good or bad and could be funded. It's this versus a set of other priorities. So shouldn't shouldn't we be looking at this in the context of all the things we might need to commit debt for. That's exactly what we're doing. This, this, what the whole point here was trying to show the council and demonstrate what impact the new building would have on the levy. There's been absolutely no discussion yet on how this would get funded when it would get funded but part of the reason that Mr point they showing you these numbers is, we are very concerned about how this interacts with a future bond package the total impact on the rate and I think it's something that council needs to think about. So that was just the point was just to AC if there was a couple of options that were really interesting to the council. Sounds like we've got at least one or two options that are, we can continue refining planning numbers that sort of thing so when a if the council wants to put this in a future bond package or however they want to handle the financing, at least we've got more credible numbers, more refined numbers based on a real design but this has been more of a planning exercise. We do have increasing debt capacity coming up here as I recall Tony in the next two or three years so that's why he 's saying he doesn't think it's going to have a major impact but if you layer this with several propositions for streets other types of things. That's absolutely something that needs to be considered it is a puzzle when you go to the voters and how that's put together. But at this point, we're trying to at least get the council together and terms of which options do you like, which should we spend some time on which are for, you know, we're vetting out a little bit further and spending some money on so if it comes time to put this in a bond package we at least have a real plan to put in there. But yeah, your points are well made but at this point we really need to know what we were planning for. Councilman Ryan. Thank you, man. The 20 cents that we currently levy. What does that raise annually what is our debt service that 's being paid on an annual basis with that 20 cents. So, so one cent on the current levy generates about a million, about a million dollars that 20 is about $21 million and then raise your what we did is we ran the projection based on the lowest option to the highest option. We would be looking again absence of any other factors, two and a half cents up to an eight cent tax rate increase likely would begin in 2022 would be the first year in our forecast where we would have to increase the tax rate again , all things being static. A lot of factors that go into we'd have to reevaluate that on an annual basis. Just for some context. If you recall the 2014 bomb program included up to a three cent tax rate increase, we've, we've not had to do that. In fact, last year we did lower the tax rate by four and a half cents. And so again, a lot of factors that go into that that will be discussing with the council as we go come forward with that just the preliminary forecast and budget, but certainly with budget adoption. We have, if we need to see it I can certainly show it. So just very quickly. This was just kind of give you an idea of what the impact would be on those tax rate increases. Again, assuming $200,000 value home 250. In that context, our average home value in 2017 was about 214,000 preliminary values are showing that home value average home value about $234,000. This would be what the potential impact would be. Again, if, if, if we were to raise the tax rate on on on just on on this average value home. Any questions. Is that it was, is there another presenter is that the presentation, there was a presentation and staff's really wanting to know. Well, here we go. There's an option or two that the council like us to focus on a little bit more probably at some point we probably need to bring you a design contact contract to at least start going through a preliminary design exercise to get to further home these numbers and to work our way through issues such as the compatibility with the site that sort of thing so that would be the next step if you are interested in doing so I think what I heard is most of you are interested in option to. Which was it was at the standalone. I'm sorry option one. So the, so the idea. Now even now even I'm confused with all the options but Oh, please. Yeah, yeah, June's coming soon. So, so the idea really is, you know, how would you like us to proceed on now that we've been able to kind of vet out some of the other sites that you wanted to is the design, would that be an RFQ RFP what's the process. Which one we likely go through an RFQ. For qualifications for professional service. Okay, what are you, what's the estimate that the price is on that, that the cost would be roughly six, depending on where you take it. In terms of getting to roughly a 30% schematic. You're probably in the neighborhood of 650 to 800,000. Again, you're starting to drill in and starting to do some of the programming stuff that we've already started to talk about, really start looking at how you design that facility is that the direction you're looking I mean okay so you got direction on provide direction on an option is presented so there is some option, some consensus at least basically on option one. Yes, so I'm okay building wise but if we're going. So, going forward with a building, I'm good with if we're going forward, exterior without some sort of small area plan included in that, then I get shaky with that because I just think it matters. If, if what you're proposing includes not only this exterior but a general area plan that I'm in but I just think, think about that if we have a brand new building, and the sidewalks are terrible, and we can't, and there's no kind of traffic plan to get down, I mean it just doesn't flow well for me and so I think it all needs to go together . individually, but again this is based on on roughly a $60 million number here so that might need to be tweaked a little bit and get you to the 30% phase. This really starts kind of taking you through some of that council member, that doesn't get into the. Some of the specifics you've outlined, but certainly we could, we could walk through that work with our planning department as well as any design professional to take some of that stuff into account. Yes, and then customer. At the end of it for 650,000 to 800,000. We will actually have the design, so we wouldn't have to go and pay for more to get a design, well you'd have you'd have the, you'd have the design at 30% on this schematic level, which really gets you into a much tighter budgeting gives you a much more secure direction as to where you're taking your facility. You know, as you move forward as well as construction management. I just, I don't think I'm ever going to get comfortable with how much things cost. I'm just still. Yeah. This would have to go before the historic landmark commission is we move forward with it. Okay, anything that you do to this campus. And that would also, you know, would be good idea for us to move forward with some type of a preliminary plan to make sure that as we go off in a particular direction, that it that it does check that box it does work. I saw the zoning and planning up there on your list and figured that that was included, probably in that part of the process. One other thing I'd like for us to look at in the design is in the new buildings, if we've got the connectivity to simply put a new work session room this room is obviously too small we saw many people standing seats are packed over there. And we need to keep the current council chambers the council chambers. There's maybe a couple times a year that that room is actually 100% full and if we've got a, a work session room that has plenty of seating large screen we can project into that room, and that might cut back on what the total square footages that we need. Well, I mean, I appreciate that I don't know if I would concur with that I mean if we're going to build a $60 million building for to last us 50 years. I think you know, to have a, an updated council chamber would be. And I tell you where we could find folks I gotta tell you I struggle with the six and a half percent professional service fee. That's $4 million. Is that just is that just kind of is that as quote unquote, I'm not gonna say it's a standard rate because everybody's gonna say everything's negotiable, like realtor fees. But is that just what people charge is that sort of the industry standards. That's my understanding, we got to figure out a way to change that I mean that's $4 million. So, on these projects I think you all have asked for the breakdown as these come forward, the hours, the amount of the price per hour, and nothing against architectural firms , I understand everybody's got to make money. I do understand that but also, I think it would behoove us to do what we can to. That just seems like an awful lot of money. And I know there's a lot that goes into it don't don't get me wrong. That's a lot hours. That's a lot hours at $300 an hour 250 or whatever it is. So, certainly would want to look at that but as far as the council chamber, we're going to do that, I don't I don't want to. I mean, it's not about it's not just about space. I mean, our handicap accommodation accessible accommodation is very rudimentary. It's, it's a, you know, it's something that I think we could certainly improve upon but that's just my own opinion . I mean, so that's just something that I'm arguing about it I just think that if we're going to build that kind of space that I think it would be okay to have that. That new council chamber unless I misunderstood what you said. No, you didn't misunderstand. Okay, and for me it's part of history it's just as if you go to Austin you go to DC. I mean, the council chambers they were 100 years ago 150 years. Yeah, so I just don't see them, you know, there might be some upgrades we might not do in there for handicap but I don't see the need for a new, new work session room and a new council chambers and I think the work session room probably be done more economically. The good thing is when that decision is made I'm not going to be on council. Probably. So, yeah, so you'll have free reign. Yes, yeah, I would just, if you couldn't discern this point of view already I would just say that, to me, what we've described would be the optimal way to go forward, perhaps, if we're going to go forward but I don't intend my remarks to mean that I necessarily think we should go forward I think it has to be in the context of looking at all of our priorities. I haven't really heard anything that I hear as, you know, a really hard objective. I think the objectives are pretty soft. Other than $400,000 being paid in rent marginal you know we're not even sure about the needs for additional space it all seems kind of soft. So, you know, when I think we look at all the priorities, you know, we look at infrastructure and basic services for people who are sleeping outside and things like that you know I think that we're going to have to look at the full list and then determine how pressing this really is, and I ask the taxpayers to come up with $200 a year, you know, and to spend $4 million a year to avoid $400,000 in rent, you know, which is the only like really hard pressing need, you know, it's not that persuasive to me yet so like I say it depends on the full basket of priorities that we 've got to choose among. Just to correct that a little bit, the, the $200 that you saw was really for the ultimate build out if we move the facility. We're, I would never have recommended that for the reasons a lot of reasons that you articulated, you're probably you're probably looking at far less than that for this facility. I don't think it's soft I think we've got a lease ending in in five or six years, it'll be here before you know it. We simply can't go out to the voters without a plan and ask them for a building we don't know what it'll cost. And so I totally understand and respect the council's feelings on that on that design fee I'm not sure that that 's where we'll end up I'm hoping it'll be lower but we really we have to spend the money just even get some clarity for you. You've helped us in terms of identifying the option. We will we can certainly build the case we will continue hon ing those space needs and those estimates down the road. But there, you know, it's not as if it's not as if it's it's that squishy we were asked it, you know, ultimately, you know, what would be at least some modest growth and staff whether that actually happens whether we can build a building design a facility that's got a little bit more flex space that sort of thing to accommodate that space without necessarily need coming in the sample at having to add the space. These are all things we can talk about the design consultant but we simply can't even position this to a bond committee or to you until we know what it costs. So I get the issue where to catch 22. Well, and look, I mean this isn't gonna happen in a vacuum. I mean we just had $100 million bond program passed in 2014 . And let me repeat that we had $100 million bond program that was passed by the voters so there's no, I don't think there's any sense that. First of all, we don't approve that. I mean so we send that to a bond committee we have the plans ready we have the financing ready and the bond committee, together with community input is the one that decides what what's going on the ballot so as far as priorities and things such as that I think I feel very comfortable those will be vetted out and have a lot of confidence in that process that we have. Councilmember. I think it would be interesting as we talk about the financing down the road to take into consideration. What I don't consider a soft number at all of 400,000 a year for rent. It's not going to stay 400,000 a year. Anybody have seen rent go down in the downtown area, or anywhere in town. No, it's going to go up. So when you consider those costs that are also being paid by the taxpayers could be used for a permanent building. It would last a long time, or to do other programs that need to be done. I think, I think that alone is an argument for moving forward with this. So, I would say let's end the fact that what do we hear about about how fast construction costs are moving up every month, that's a delay is a month that adds to the cost to the taxpayers. So moving slowly. I think we need to move deliberately. But to move slowly is to add to the cost and to the burden of the taxpayers. So question. Let's say, just for the sake of discussion that we move this to the next bond election and so it goes before a bond committee. What has to be present. What level of detail does a bond committee require to be able to fully vet that project in the public and within their deliberations is it 30% schematics, is it in other words, how much money are we going to spend just getting it to the point where the decision is able to look at it and deliberate on it carefully with enough detail to be able to make an informed decision, we 're going to have to go at least to 30% schematic design, given what we've seen in the 2012 and 2014 bond packages which were so grossly underfunded. We are going to need to have with a building like this if we're on five or 10% that's millions. Yeah, so, you know, you've all been wrestling with, with some of that so we're going to have to at least get to this level detail. I think the other thing for the council to consider. And I don't think I'm disclosing any confidential issues at this point but we are seeing a number of projects we're having discussions with a number of folks that are looking at redeveloping in that particular area, when you let the design contract for PEC three and four. You got a lot of people interested that's the that's the downtown drainage way that will basically connect elm to Carol, and take a lot of those properties out of floodplain south of Hickory when you did that, there's, we are getting more and more interest in redeveloping properties in this area, it is entirely possible that the property owners will look at redeveloping the building that we're in right now. And because we won't make a commitment to them. Oh, you mean that the bill that can we're already getting we're already getting development proposals and ideas all around that facility and including that facility so it's just something to keep in mind that I 've asked staff to start investigating alternative options should that happen down the road but I consider this something that we really we've got some advanced knowledge, we know that we're going to have to come up with a solid budget we can we're not going to be able to afford cost overruns on this building if it goes to a package and gets voted on in passes so it's important. And that is needed. At some point, if it's going to be presented to a bond committee, they're going to need, they 're going to need those plans that would cost about that much. Yes. I may, I may be early, but I really would like to see your thoughts one one page sentence or two red line on the previous bond packages lessons learned, you know, I mean, because this would that you inherited those things. And so I just want to understand your your look. Hey, I've assessed this. Just because I think that would be good to consider going forward. Okay, thank you. Okay, go ahead. Does the money for the come out of the general fund. Where would it come from what but at this point would probably come from the general fund, if we started putting other options on the table. You know, I know that the idea of a parking garage isn't necessarily getting much traction but something like that could be there could have two and three funding sources the tip kicking in for instance as well as a general fund so really depends on where we end but the planning dollars likely from the general fund. And it could be some utility contribution as well since they would be also moved into the building. Thank you. One direction is on the option you have that and the direction the other direction is on the funding for the preliminary design is that what you're asking for. Yes. Okay. All right. Council members what your pleasure. On this. Proceed. Okay. Anybody else. See, all right. Over here on this side of the room. We're going to evaluate the numbers get get. Yeah, I just want to make sure I got everybody. When I'm saying that the initial upfront costs we're going to we're going to work that best we can write will work that as best we can and the budget numbers are going to depend on the level value engineering we go through we already heard some ideas and concerns today about making the building a little bit smaller as well as when it would actually be constructed has a fairly big impact both both of those variables together alter those most those numbers you saw five to $8 million. So, if I may, sure. Thank you. I think most of the designs have done 3D now. And then we get them flattened out. Right. I think that's the. So, I don't know if that's the case but such that it's done already like I don't want to add a cost but if they have it that way already. I'd like to see what that looks like and start working on that road. Yeah, I'll meet with staff and the city attorney's office just to get some ideas in terms of design options construction options that sort of thing and we'll be back to you, we understand your copy your concerns over cost and we'll try to reconcile those best with state laws we can. Is that I gotta have that recorded. It is recorded that's a great that's a great statement. Yes, Councilmember, do you have a question about the process ahead of time. Is this the time when we would say that we would request that the building come prepared for for solar or be a sustainable building or is that somewhere later down in the , in the process, after the 30% design, we would certainly communicate to the architect I'm not sure what that changes in terms of the electrical and that sort of thing and any planning but we will bring that question up. I'm just not burst enough to answer your question but we can certainly ask them about that. Thank you. Okay, any other questions comments. So I think you had direction. You had direction. Okay, thank you. Okay. All right, let's go ahead take about five 10 minutes. Welcome back to this meeting of the Denton City Council Tuesday May 22 2018. It is 247. We're moving on to our next item and work session reports agenda item three be received report hold discussion and give staff direction regarding the dent municipal electric FY 2018 19 operating budget capital improvement program and renewable resource plan. Mayor City Council. My name is Tony point the director finance. Thank you for having us this afternoon. I'm going to walk you through our presentation here for for dental electricals budget and forecast. George Morrill general manager is here as well and so we're going to tag team this presentation, go through a number of slides. The hill cover that I'll cover we'll go back and forth and cover try to cover all this presentation for you. So just really quickly going through what the objectives so that you know, just in advance kind of what's coming. So we'll kind of start off with our load forecast we'll talk a little bit about our financial assumptions. There had been some questions about commercial versus residential rates and so we have a slide, then we'll talk with you a little bit about that energy cost adjustment, we'll talk about some proposed changes to that, as well as the elimination of the suspension of the TCRF, the transmission cost revenue factor. Go through the financial forecast, talk a little bit with you about the overall debt for DME. What, what it was as 930 17 and what we projected to be based on the proposed budget. Talk a little bit about purchase power some of the recent contracts that we've had and what the, what the impact has been to that the striving to a large extent this budget. And then also will cover our latest performer for the, for the deck the then energy center. We also have our consultants from ERC here. They're also available. If the council has any questions. And then finally we'll wrap up with the departmental specific presentation, including the, the capital improvement program. So just quickly here I just wanted to show you what our current load forecast is. As far as our customers what we anticipate our customer growth will be and what it has been over the last several years certainly over the last couple years we've seen not quite as high as we have seen back in the 2013 2012 range. Certainly the recession has had an impact on that. As far as our residential customers. We do plan for about a 1.6 growth rate in our residential customers total we're looking again about about the same amount to 2% to 1.5% increase in total residential customers in that are being serviced by DME. A little bit about our mega, our sales of electricity and also what our peak is we're currently projecting a peak of 361 megawatts. Certainly 360 for the summer. As you know, you know, fall intensive if you've read and in all the papers and what have you that we do anticipate a very hot summer this summer and into next year as well. So, this just gives you a little bit of the trend of, of what those sales have been and, and what we anticipate for our peak load for for the municipal electric. Regarding the financial assumptions. One of the things that we talked to talk with the council about last year that we are currently proposing is to pay off $28.6 million in debt that is on the city's books if if somebody on the council may recall that back in 2010, we had refinanced it's called the scrubber with TMP a that's on our books. That is callable in February of 2019 and so part of this would be to propose to pay that off to cash the fees that so we're going to draw down reserves to pay that off. And, and realize the savings I have a slide later that I talked to more about that. Did you have a question, customer. Is that scrubber debt coming back up later is that what you said yes ma'am. Okay, I'll give you a little more detail in a few minutes. This, this, this forecast assumes no change in the base rate for for dent municipal electric. Again, we'll be coming back to the council also the PB on the specifics of that rate ordinance and the council will see that as part of the preliminary budget in early August. This. The other assumption here is that the suspension of this TCRF Georgia will go through and talk to you a little bit about that. The, the forecast also assumes that we would maintain the current EC rate. That's a 034 one per kilowatt hour. That impacts all our customers residential commercial across the board. Part of the recommendation here would be to also update the EC a ordinance to reflect the deck net expenses. And so, again, we'll have another slide for you to talk about that again. All that has gone into this forecast, reduced purchase power cost, a reduced capital improvement program. We'll be talking to you a little about the bond, the budget amendment that that we're proposing that's part of your individual consideration. That's part of that particular strategy. And then finally, we are proposing to debt fund, only a portion of the transmission projects. And assumes over the next five years that we would cash fund any of our distribution capital improvement projects again, albeit at a much lower amount that was initially projected over the last couple of years. So, some of the things that some of the major impacts factors that are going into our forecast. We've seen a reduced purchase power costs about 33 million. The major components of that are attributable to our projected $20 million net income for for the current year from the deck. And then also reduce TMP expenses about 22 million. We are looking at a reduced CIP program, not just in the current year in 1718 but also in 1819. That program is reduced from what was originally originally projected about 45 million to 23 million. And then finally, part of the individual item from consideration tonight would be to cash fund $24 million of the currency IP program. In that program we had initially anticipated issuing $54 million in CEOs. If you recall when we came to you about a month ago to approve the notice of intent of CEOs we excluded that. And so, the plan is to not issue any CEOs in the current year for them is electric, we would instead cash fund $24 million of a much lower program which is which would require $34 million of additional funding. $24 million would come from cash from from the municipal electric, and then $10 million would come from excess bonds that we have that we're projecting to have from the deck facility. So it's $10 million of utility system revenue bonds that were issued in January 2017 that we're projecting not to use on that deck facility. The bond covenants do give us the opportunity to utilize these on any other electric system projects and so the proposal would be to simply shift those from the deck project and utilize them on other electric projects. Again, that's within the allowable usage of those of those funds. Councilmember Briggs. On the reduced CIP from 45 million to 23 million. Is that just projects like substations and transmissions that we were going to do but we're not going to do. Is there another slide that talks about those in detail. Yes, George will talk to talk with you about the CIP program and he'll cover that. Okay, thank you. So Georgia come up here and talk with you a little about the next couple of slides. All right, Tony. Thank you. Mayor and City Council George Morrow DME General Manager, one of the talk and high level of the focus for our budget this next year. The expansion program was introduced and that's still a big job for us we dedicate a lot of resources to getting our T ND system upgraded and expanded. We're not proposing to eliminate any projects but we're, we're managing the implementation of those projects, a little closer to the time frames and that that the benefits from that expansion would be really needed. We're doing a lot very quickly, and you're having to finance pretty much everything we're trying to get our budget, a little more in shape and do more cash funding. And when we looked at, you know what we could afford versus what actually have to be done. We found there was a good match between the revenues we could generate from our, our budget, and what we needed to be done in the short run so and we'll talk some more about that. So here's a big project for us. Largest capital improvement in the, you know, I think in the history of Denton, and it's doing great. It's construction is basically complete we're in the testing phase as we speak. We showed you phase one of the energy risk management policy we want to come back for phase two, where we start talking about you know risk profiles and those kinds of things I think you'll be, you'll be happy with what we're going to bring you there. We need to go forward with a more sophisticated model for managing the trading that we do the ETRM. We had an older bid out there that expired and we're going to go ahead and put that back out there. Renewable projects we're still striving for the 100% renewable by 2020. The process is going great with new Bronzeville's, and we 've got a couple of really really nice projects that we're interested in and that make a lot of sense. And then eventually in another month or two we'll put our own RFP out there, looking for that last tranche of either solar or or coastal wind that'll get us to the 100%. You know reliability is important we're going to continue to sweep our, our distribution networks looking for anything we can do to make it more reliable talked about that a week or so ago when we gave the staff gave a presentation on reliability. And, you know we're getting more and more resources in our power supply portfolio and the markets are getting a little crazier out there. The market's a little tighter. And so that's going to be a big job and we're going to have to focus on how we integrate and manage those power resources going forward. The good news is hey we're looking pretty good when we updated our rate comparison with other utilities. These are compared to other what we call no ease non opt in entities. These are full service utilities, basically cities and with the exception of co serve, and we're falling right in the middle the green is where we are today. We mentioned our proposal to suspend the TCRF. That's about a five and a half million dollar rate reduction, it will generate about three and a half percent benefits for the residential customer so this is a residential rate comparison and you see the yellow bar is going to be where we're going to say it when, you know, if you implement and approve that three and a half percent reduction breaks. Are we similar in population size to the cities that are less than us. Yeah, you know we used to have a slide we showed it pretty much every budget to show how we fit in there. I think for the most part. We're about right in the middle, I think we're about right in the middle, New Brunsfield is being smaller Brian I think it's almost identical Garland might be a touch bigger Brownsville not sure, be honest, new kid in Texas. Which way. And I don't know that size really affects you know base I 've worked for smaller large utilities I don't know that size really affects kind of how your, you know your average rates. It depends sometimes on your historical power supply portfolio and your customer usage patterns and how much residential versus commercial and industrial you have sometimes if you've got a city with much more industrial, you can drive your average rates down quite significantly so, but we tried to make this apples and apples, and the good news is I think we're versus some of this comparisons I saw in the past, we're looking much better. And this is another way to look at that we do have a question. What their population is comprised of in their probably 100 year history of their utility and you know their investments and, and, and you know whether when they made investments in their system and how much is paid off and I think what their power supply portfolio is and you know a lot of older resources that are low cost versus, you know, as time went on resources that tended to increase so I don't have anything offhand I'm thinking of the same question to be honest with you. I see the same thing. We'll try not to look at those other folks that are higher than us, so we don't get any bad ideas. Gregory. Well, it seems like not only is there the size but the growth. And we've just put an awful lot of money into updating a 60, a 40 year old system. And I don't, and I'm not sure that new Braunfels is growing at the same rate but I don't know. I think that would be curious to know. I'm curious about the city of Georgetown because they've gone to 100% renewable and I'm curious. Are they already there is is is that their new rate or is, are they in the process of, I think they're still in the process of getting to 100% but they're very close to being where they want to be. And, you know, we're wondering how they'll perform this summer, you know, whether those resources will show up, you know, during these some of these really high prices that we 're all forecasting out there so there'll be more that we're going to learn about the Georgetown experiment and the, including the DME and that's an experiment at some point, and we'll be bringing that information forward to you. Thank you. Thank you. Okay, the next slide is the same kind of comparison you see DME and their current versus proposed the green versus yellow. And these are all the competitive suppliers out there not just the other cities and, and always as we call them. So you can kind of see where that's at. I had one story I mentioned yesterday at the pub I did some research of one of these competitive suppliers back in mid March they had a price that they paid. One month later they they went up about 20%, another month later they're up another 28% a total of 48% over two months, this one of these competitive suppliers, they're starting to understand that the markets prices are rising out there, and they aren't hedge like we are they don't have a full portfolio of resources that can, you know , match the market prices so I think we're actually going to be moving even more to the left as, as we go through the summer here, and things are happening pretty quickly out there so so we're in a pretty good position, even between, you know, most of the lower ones and us, you know there's actually not a huge dollar impact, where we'd be down at $124 for average customer usage. And I think if you move, you know, almost all the way to the left, maybe you're looking at $115 for some of those so so you know there's a lot of comparability, except that the very extremes. And I think the other guys, you know when you look at our commercial rates they look, they're lower than residential rights on an average basis. And the reason is utilities electric utilities look at cost of service, how much does it take to serve different rate classes and residential generally have a relatively high cost of service when you look at the facilities it takes to serve them and their load profile so so they're, you know, they 're, that's why residential rates are a little bit higher than commercial. When you look at the cost of service studies themselves, we did one in 2013 one in 2018. We're seeing that residential customer actually paying less than their calculated cost of service. Probably a bad way to say this is commercial customers in a way, pay more than and perhaps are subsidizing residential. I've been with quite a few utilities. That's typical, you know the residential customers generally pay at the lower end of their cost of service, because that makes the most sense for communities and, and society and those kinds of things. And one of the last things I saw was that commercial makes up 60% of the revenues of DME and residential makes up 88% of the revenue revenues for DME. Well, they make up probably 88% of our customers, when you count customers because there's a lot of small ones right, but they don't make up 88% of our revenue so, Mary what you got on our revenue side. I think it's about a third a third a third residential about a third smaller medium commercial about a third and then larger industrial customers make up about a third of our revenue. So, it's a little thumb and most utilities. How do we divide or define commercial and industrial is it the by the amount of usage or the amount of square. Okay, by the size by their consumption consumption. So as they get more and more consumption we can move them to a rate class that's actually a little more attractive to them because they're, they're cost of service is less for us to provide that service. I wanted to share that with you. I don't know if that's intuitive or not. But even though the residential customers pay more on a cents per kilowatt hour basis. They're actually being paying less than what their fully allocated cost of services. One of the other things that we're coming forward with today is the ECA where when we looked at the formula that's in the rate book we noticed that what the deck was not included. There was never a need to really specify how we treat the deck in an ECA. Remember ECAs are energy cost adjustment. All utilities that I've been involved with and most in the country have an energy cost adjustment. And it's because of the volatility of purchase power costs about volatility of the market. And you want to be able to, you know, make sure you're not running a huge deficit in your budget. So this, this balances that your purchase power budget at times when you're doing well that provides money back to the customers. If you have an ECA that adjusts at times when your costs are higher, it can allow you to, you know, to recover those costs. So it doesn't include the deck. It's something we're going to be recommending that we go forward and include the deck debt and operating expenses. And, and the reason for that is any other power that we buy any of these other solar contracts, wind contracts, we're paying fixed and variable under those contracts. So it would be treating the deck simply the same way that we've done. We treat other things. There's a small ECA balance at the moment. No, no, go ahead. I'll catch you. I've got a question after this slide. Go ahead. Small ECA balance out there about, we're projecting about 7 .8 million at the end of the year. We're going to take that forward and use that to help manage the purchase power budget going into the next budget year. But the objective is we're going to try to stay with the current ECA rate, the 341 as long as we can. And then at some point we'd like to go to a more, more pure calculation of the ECA. I think that's what it was at one time. So when costs go down, we can provide real time benefits to the customers. When costs go up, we can recover those costs on the near term. Question, Mayor? Yes. And you have a slide on it, but because of it coming up a couple of times, I thought I wanted to go ahead and throw it out here now. I'm going to, and I'll go a little bit more in detail. When we get to the deck performa, I really am going to suggest that we do something different with the deck. And that is that it become more, I think you and I discussed that with Todd, that because it is almost like a standalone asset in a sense, that the monies that we're getting, that's why I bring it up now, because the $20 million that is part of the deck performa or actual revenue for this year because without the debt service. I'm just thinking we need to look at this as a standalone asset, especially in the first years where all those net income dollars go into sort of a segregated fund to make up and to pay for the losses that are out in the out years, because it makes it a little bit more clean from a rate perspective of if we've got in the rate, we've got to account for this increase in net income revenue, which is somewhat artificial. It's an increase, but it's because we don't have that service and in these out years. So I think it would be easier to understand and more consistent with what we've been trying to do with that to say, hey, if we've got $33 million that we're going to project for two years in revenue, but then over the next four years, we're going to be looking at almost that same amount in losses. I don't know why we're going to say what we made this much more money within we've lost this much more money when it's all attributed and within the confines of that deck system. So, we can talk about it. When you get to this I just wanted to because you've included it in the ECA, you said we need to include the deck in the ECA. And so I think we I would like to see it more segregated as more of a I don't want to say enterprise fund but and then when it starts getting if it does consistently have losses, then we're going to have to figure out okay, how do we do that? How do we portray that? How do we say in that ECA rate? Maybe we split out say, here's an ECA rate. Here's the impact on the ECA rate of the deck. I just I don't want it to become so melded together that you can't identify it because I think that's important, especially for further analysis down the road on what do we do with that asset, either if it's overperforming or under performing. So, if you want to head down that that road from a policy perspective, probably the cleanest and simplest way of doing that is we can we can certainly put kind of a stabilization fund in place. I think that's what you're talking about. And then it would affect the fund fund balance or the reserves of the fund and you could certainly restrict some of the reserves in the funds to serve as a debt stabilization. So you'll hear you'll hear part of I believe part of our presentation is that we're normalizing normalizing reserves around 40 to $50 million. So you're basically what you're basically suggesting is that, you know, we could we could add on top of that 40 to $50 million until we have a little bit more certainty, which is fine. We could go back and recalculate if that's where you want to head but that would be the cleanest and easiest book keeping way to handle it. And then we could certainly adjust the formula here. I mean, it's not to me it's also about transparency just making you because I hear what you're saying, but when you see those large balances unless there's a really strong policy ordinance in place to say hey, whatever the deck, I mean, we can trace it that we can accurately trace it that of this fund balance. X amount is attributed to these first two years of the deck and therefore that money will be sort of either segregated or restricted to paying for if there's losses in the next few years. All right, to do that. Let's take that back and we'll, we 'll drill down a little bit understand the concept may or may not be totally completely feasible because we sort of count on, you know, it's cash flow and it's budget we sort of count on those revenues, but that that is exactly, exactly. However, we will keep track of it . However, we will keep track. Well, I understand that but that is that is exactly my point is that it over a couple years, two or three years it can sort of get lost in Oh, well, here's our rate. Well, we can, we can say, sort of parse it out, but we still from a cash flow perspective, I look at this like a real estate investment. If I got a real estate investment that's making $30 million in the first two years, and I'm pretty certain it's going to lose money in the next four or five years. Yeah, I don't think I'm going to put that in my general fund for, for, you know, dispersing for new acquisitions or things like that it's like okay, I separated out. Let me see if I can take care of that moving forward. So I hear what you're saying but that's the real reason why I almost want to look at it separately because I know you got to calculate it for rates, but we've just got to be able to track it. And I don't want to say well we made $20 million this year. But next year we've lost 5 million at the deck and it just gets forgotten. And I just don't, I don't think that's going to be helpful. Yeah, but that's just how I'm looking at it. All right, well, explore that some more council member. Well, I'm actually on the same page I have a note here that I have a problem with you can go to the next slide it shows that the calculation. And unless the revenue from the deck is always going to be more than the debt service and operation combined which I don't think it is. I'm definitely not in favor of it. I mean, if we do this and put it into our rates we're asking our 50,000 rate pay ers to pay for decision for people made, if I'm understanding it correctly. Yeah, because, well, so when there's benefit to the, there 's net revenue for the deck, the ECA benefits from it when there's net cost for the deck. ECA pays that, but you know, every one of our resources we do the same thing we bounce. You know the decks no different than everything else in our portfolio we bounce those off of the market, and some of those. Some of those projects are, are, they don't make money there, you know, because you contracted for them in a time frame where the prices and values were higher, they were fair prices we paid. Just take one example would be the whitetail contract. That was a fair price back when that was added into but the market prices have declined. Today we'd be a little bit upside down on that contract, we don't, you know, on a real time basis. So everything, everything is bounced against the market and not just the deck and then it all gets pulled together. Some projects, the new wind contracts going to be very economic for us and it's going to provide revenue that helps support things that might be upside down. So, I think was I think was important for the council understand this discussion is, it's all the same money it's all fungible. So if if the deck loses money one year, and we started, you 've got certain companies you've got to be able to pay the debt back, it's simply going to be a transfer. If we segregated it to another like subfund so going to be a transfer over there to pay that perspective to handle all the expenses so we can certainly track it from a pro forma perspective on annual basis we could certainly set up a sub fund to restrict part of the fund balance by policy we do this all the time with bond covenants. It's the easiest way to handle this but if you get into a position where it's losing money, the bill still has to be paid and you're going to be transferring money over there anyway. So, and I, and I understand that. Okay. I'm always saying don't pay the bills. Yeah, what I'm saying is is that you've got you've got to be able to pull a report and say, here's how much. Here's the money that deck made. And we're going to use this because if not you're going to put it all on the same, you're right. It's quote unquote fungible that to me is where the concern comes in. This is a 200 something million dollar asset that is one of the biggest projects we've done, and we're looking at a performer where it's going to be in the hole. When we start paying debt service, based on our current day. But that's why I think it's important to say okay the first few years. Let's just track it and if it requires a transfer of funds to me, that's an accounting issue if it's a if it's a council decision that has to be done. I think that that provides at least the community and the council at that time. The opportunity to look at a pretty straightforward accounting picture of the deck. We've been talking about cash flows and it's really easy for all that to get lost in the shuffle, and that it's all becomes one and we're all one big happy family and I get that. But this is a big project. And it's not anything like Blue bell or whatever where you might if we bought it for $45 and now it's $35. That's just a contract here we've got a whole asset that we 're paying $20 million a year for debt service on. So, I just think that we need let's let's just let's think that let's take it back and visit that deeper. So it's fine. I think we're going to get where you want to be. And certainly we intend to keep very very good records of the deck performance, and it's, you know, it's cost and it's return. So all that all those numbers going to be there fact we probably do them every month. Just, just if you just like in the first slide you said we had reduced reduced purchase power costs, and part of that is attributed to the revenue from the deck which is $20 million. So, yes, in the end, from a general fund, sort of a bucket of money cash flow perspective yes, but if we didn't have the deck. We didn't have that, and it's almost a little not misleading, but yeah we got $20 million of revenue now. But when you look at the fork, the forecast. We're forecasting to lose, maybe 30 million over the next four years forecast doesn't mean that's actually going to happen. And so I just, you know, all the sudden just pull it in and make it all part of it both losses and income. I just would like to really see that more or able to be segregated. One consequence of keeping the deck separate is that it doesn't become a hedge perhaps for our load, if we have to keep the, and we're going to have to go out there and acquire other resources to be a hedge for our load. So right now, it's just financially, I'm not just accounting from it. Yeah, I'm talking about financially. I'm not saying you put it out there and it's not part of hedging our load I'm saying, okay, the standpoint of expenses and revenue. Hey, this money that's being made is additional profit, because we're not paying that service. So, let's keep it somewhere so that when we have a $2 million loss we're not just coming out and dragging it from here. We got it right here, we're just going to transfer it over that's however y'all want to figure that out. All right. We'll work on it. My last comment, if I didn't have that 20 million from the deck to credit to purchase power, you know we're going to write a check for 20 million to the market for instance I'm saying. Oh, I understand that. Okay. So, but you're going to stand up here, and I'm going to turn four years from now and say, if we didn't have the deck. We wouldn't be writing this check for $30 million from our reserve fund. That's, that's all I'm saying is it sounds, hear what you're saying, but there's a flip side to that as well. And that's my only thought, and I'll stop with that because I'm not trying to, I'm not trying to cause a stir I just I feel very strongly about making sure that we can account for that. Yes, Councilmember. Thank you. That's good. Well, in listening to the conversation, I don't know how you segreg ate out the two, because we've not lined out the usage. So, if we run it all the time up to our maxes, then that's going to produce a different dollar amount which produces a different game versus if we run it less on purpose, for whatever reason, it's going to produce a different dollar amount and a different loss. I think that then becomes another policy discussion that ties into what you're requesting. I don't see how you separate the two without clear delineation at this point of when is it going to be on with and I still am a little fuzzy I've heard it both ways I've heard hey we have no control over it, and I've heard we have control over it. So I don't know that I know the answer to that question yet . I'm listening. Sure. Yep. You know the cleanest way to think about the deck is we don't have any control over it. It's just simplest. That's my understanding. You know we'll bid in our costs for the deck our variable cost and then the market will determine whether it runs or not. We get a signal dynamic signal from aircott talking directly to the unit and the control system at the deck, and it will operate and move up and down based on that that signal from aircott so so we're going to work. We're going to work with the cost when so the air cuts going to call on it and, and we'll, we'll. That's where that money comes from is eventually, so we're not going to control it and we're not intending to withhold it from the market. It will be available as long as there's no issue with the mechanics or anything. Thank you for that. That takes us back to where we were initially. But then I know Mayor Pro Tem McGarry at the time had mentioned, there was a way to to to interrupt that and so that's where the fuzzy understanding came. But not our intention to do that and I think aircock would frown on that particularly during periods when there's a reliability issue for them. This is going to be a great reliability benefit and that's their job is to make sure the system doesn't fall apart. And, and so our ability to manage that self manage that's going to be pretty minimal. Yeah, so so that's I guess my, my question this conversation is, if we normalize that somehow, which I don't know how we do that to then, you know, I think the numbers, the profit and the usage go hand in hand, and then I don't see a way to have a defined usage which then, you know, there's no defined problem, but I, I 'm tracking with you, I just, I'll be interested to see what comes back. Yeah, this isn't anything about the deck or, you know, host ility, it's just about, hey, that's, I mean, this is a big, big project, let's see how to track the money to cover our losses if it's making money. And so I hear that we keep saying we don't have a debt payment, which is right right for the first couple years but it there is interest. So we may be making 20 million one year but in two years, we owe 19 million 600,000 already in interest so I don't I don't necessarily see it as, you know, a profit, because we are still paying interest on those years even though we're not getting the interest capitalized so we borrowed enough money to pay the interest and that's in the debt payments. So we're going to have about 4.5 million in 19 so next year, and then it goes up to the high level, just under 18 million thereafter, it's about 17 years worth of that high level, and then the debt goes away, and then the deck will be debt free for its next 10 2030 years. That's important. It's important subject. Okay, so what we 're proposing I think council member mentioned, we wanted to include include the neck, that expenses into the ECA, which could be positive it could be negative depending on how much revenues we have. Because it is a power supply resource and the ECA is for power supply cost management. That's the purpose of the ECA . And with that I'll sit down. Let me out here. He was complaining yesterday he had all the bad slides and so. Yeah, I think he's, he is, of course, yes, yes, I will only be up here as long as I need to be remembered and we'll let George back up here. So, so, Mayor to address your point so I guess as I'm sitting up here I'm looking at this as kind of option one. So, we'll certainly come back to the council with with a couple of other options on on some alternatives to to address some issues that you've kind of brought up but so in this forecast as I stated in my in the assumptions that we have so in this, in this forecast we are projecting to pay down $28.6 million of that 2010 scrubber debt certainly. That's a big component of this forecast and if we are going to do something a little bit differently with that may be impacted. There's about a $3.7 million interest savings by paying these off early. So we would need to look at that. In addition, the future cash funding of CIP projects would be something else that we, we'd want to look at. Because again, this forecast assumes over the next five years, we would cash fund, many of those projects have limited future debt issuances. And again, there's a little bit of a trade off here between paying off some debt differing some debt to be able to get us to where we are versus segregating or keeping that 20 million projected from the deck in some type of reservation . So, yes sir. So question then this debt defesance is this the debt for the scrubber that we took out through 2020 when was that if we had paid it out when would it be normally do. 2010 it was 20 it was 20 year debt. So it'd be 2030. So we 're paying it off now instead of 2030. That's correct. 2025 sorry 2025 okay. All right. And so is the $28.6 million that we're using. Does that include the $20 million revenue from that we're anticipating to get from the deck on the performer, there, there is a combination of that and draw down and the current rate civilization fund for for this fund that's also being used to cash fund. Future capital improvement programs and so again it's it's it's it's a fungible amount that we're looking at. I understand that so I want to make sure I understand what you just said. So I'm looking at this proposal. Where's the $20 million of projected deck revenue in the revenue which revenue category is that in. And that is mayor is actually embedded in our purchase power expenses. You know and not to not not to kind of belabor this but what we're going to have to do from an accounting standpoint we're going to have to look at what our monthly purchase power expenses are to ERCOT and then try to identify how much of that was that deck revenue, so that we can account for that separately. So again it's, there's a little bit of a back office. That's exactly what you do mayor to be able to get us so let me make sure that I understand what you're telling me, because I, this is exactly what I'm talking about. So I've got to go through this question series of questions to understand where the $20 million that we're showing as a potential revenue from the deck. So when you say it's in purchase power and fuel so let's say we didn't have it. Let's say it 's not there. Does that mean that that figure would be $65.8 million. If we didn't have, if you didn't have that $20 million debt , $20 million revenue from the deck that we're projecting for 2000. So, instead of it being a quote unquote under a revenue. It 's being taken off as a credit against purchase power here yes sir. So if we didn't have it. That figure would be $65. 8 million. Given the discussion we're having. Yes, not not trying to figure out but given the the the kind of okay. All right. And so moving forward. That's, that's where that's showing up so any revenue that's showing up from the deck, you're saying is in purchase power and fuels of credit, any loss is a is a debit to that particular. Right. Okay, that that that's my. That makes my point on why, if you're able to put a category or a line item, or a, you know, sub line item, because it gets lost and and mayor understand that that we would have to do that in any scenario that we that we bring to you. The deck expenses the operating expenses for the deck are in a separate cost center. You know we account for those separately. Right. It's not in a separate fund but it's in a separate cost center so we do account for those separately. That information should also be in the backup that we provided to you. The other way you can show is you know the deck revenues and then you basically still have the debt in the purchase power costs it's still going to net out and be exactly the same, but I, but I think from from an understandable understand ability perspective. When I hear revenues, I expect to see a category called revenue. Okay. And then if you're if you're, and then you 've got your purchase power fuel and all that. This is what the actual cost of the purchase power fuel is, and you're right it nets out right but it's clear you're not having to. Does that makes it's like we used to do with economic development incentives. Yes sir, how those were hit not hit those words embedded in . Well I mean that's the wrong that's the wrong word choice because that's not what I mean. They were embedded in the expenses or the budget we finally made that a little bit more clean here's our revenues and here the expenses, and they do cancel themselves out but we can we can absolutely show a deck revenue we can show specific that sir, that service if you want. We can we can we can we can add a few lines I guess point George and I were trying to make earlier is it doesn't change this at all. No, no it doesn't. But but it's easier to track, but it's certainly easier to go okay wait a minute. Instead of having to say well this is a credit. Okay, to an expense that those are easy fixes. So, again, just to reiterate in this forecast we assume no base rate, you know changes kind of going forward. We do are proposing to suspend the TCRF. And that is the current rate that previously showed you. Going forward, would kind of self calculate. Again, that's kind of based on this scenario and based on the formula that we showed to you part of the discussion that we had last night with the P.B. was that, again, we would bring that back to the P.B. on a quarterly basis. And also we've committed to bring that back to the council, not just on the status of the CA but also routinely provide the council and update on the debt performer. So none of that would change under our recommendation that would stay as it is, we are proposing under this forecast to target 40 to $60 million in in fund balance for, for the, the electric fund. And we've also shown here to you this is an update to what we had in your backup, but our debt coverage ratio, we believe continues to stay well above kind of our debt policy requirement of 1.25. And so again, we think that financially speaking, this is a sound forecast for you. Certainly it's one option of several that we can bring back to you that we can work on here in the near future for you. Go ahead. I thought you had a question. I do. I was about the scrubber, because we mentioned it earlier and I guess this is probably the spot to talk about it. The 28.6. Okay, so, so that's the debt that we have on the city side. That's correct. For that. Okay. And that used to be a lot higher. So I guess we've been we've been paying on that a little bit every year and this is what's left. Of the scrubber debt. There was two additional issuances for some cabs that would still be on the city's books that 's not part of this number. Okay, because when I thought I was thinking it was closer to 60 million instead of it and I have a slide where I can show you what that what that number well I don't think it's, we haven't broken that out for you sorry. So, okay, so in my mind that number still kind of total debt for that is closer to 60. Okay. I just wanted clarification so I'm good. Sure. Council member Melzer. I hope I'm not slowing everyone else down. Pardon me this. This is a little new. If you if you wouldn't mind just telling me is the TCRF and is the, is the ECA, are those line items that are sort of added, you know, added expenses on a customer's bill or what I just don't know what those are. I don't want to just pretend I know. I imagine people watching might not know either. The race we charge customers composed of three components the first are base rates, and those are the, what we're typically think of the rates that are in the rate book. Then there's the two adjustments one is the TCRF, which helps us to pay for our transmission expenses. So at one point, we were seeing increased transmission costs from air cut to support the grid, and we had no revenue source for that so council approved establishment of this, this factor on the bales. Then the third piece as you mentioned, Paul is the ECA energy cost adjustment, which, again, utilities use that to handle the perturbations in the market, you know that high sides and the low sides and the availability of resources and the unavailability resource all those factors that affect our purchase power. And so we do our best to forecast with a single number but the reality is those can be dramatically different on a real time basis, the customer perceive these as taxes and fees and this is the fees part. You know they're just additional line items that that's how people see them. Or they built into the rate. Yeah, so the if your basic question is, can customers see the three pieces the answer I don't believe is yes I think it's no I think we provide one number, because there's other things on the bill for other utilities and if we bothered to break everything out it would get a little bit complicated so we just show one number on a cents per kilowatt hour basis for residential and it would, but it's composed of the three elements, and are these regulated in their, in their definition. The economy and the TCRF. Totally there's a formula for each and the. At this point that the EC has been approved by the council. There's a formula, and we're proposing to go back to the way it was at one point in time, perhaps after this next budget year, and go back to it where it would vary on a quarterly basis. There's a formula there we just plug numbers in, and then we show you hey here's the, here's the new calculation and and we'll want to make that adjustment up or down. And if I can just press. Thank you. So the end so the TCRF is something that we may charge at Council's option. But we were not required to charge. So, this is all a question. Is that correct. Yes, so it's totally up to the council to charge the TCRF. We're recommending suspending it this next year because we felt we could cover it in our base rates, we had enough revenue we could cover that, and we wanted to provide, you know, we were able to provide a discount this next year, that's where the 3.5% rate reduction effectively comes from is the elimination of the TCRF. Thank you for clarifying. No problem. So then, what you're saying is in the future, depending on what we're paying or instead of having it a separate line item or separate cost is the TCRF. If there's a need to say, begin charging again for the TCRF , you wouldn't split it out in this particular line item, and you would include in the base rate or you required to statutorily to split it out. No, we're not required to split it out. It was just the mechanism that we used. Sometimes it's complicated to change the base rates because the number of pages involved all the different rate schedules. We have to reprint everything reprogram all the bills and so forth. Sometimes it's easier just to add this one element that was equal for everybody, no matter whether you 're residential. So this isn't a permanent change. This is a change for the next budget year. Right. So, as we indicated in some of our materials, we're asking you to suspend it this next year and generate that rate reduction for residential customers, and we're going to look at it again. And we hope we can continue to suspend it, but we're not sure. Fantastic. Yep. Thank you. Mayor Councilmember Briggs, I have the information for you. So what we would have from the cabs that would still be on the books if we pay down the $28.6 million would be about $ 13 million as those are the cabs that we refinanced. Those pay off in 2024. They're not callable but they would pay off in 2024. At that point, there would be no, no additional TMPA debt on the city's books that be all paid off. The only component that would remain would be the transmission component of debt that's still at TMPA where transmission revenue is being used to pay those. And so the city still has an obligation to that, but they 're being secured by those transmission revenues at TMPA. So just quickly wanted to just give you what the debt was for DME as of 9/30/17. Again, this does not include any of the proposal that we're making today. I'll cover that in the next slide. But as of 9/30/17, what Denmysipa Electric had on the city's books was $939.7 million, was the total principal and interest at that point . In addition to that, there was about $60.5 million that's still on TMPA books for a total of slightly over a billion dollars of total principal and interest of debt that the city and Denmysipa Electric was obligated. So that does include the debt is also kind of included in these numbers. Again, as I mentioned, that does not include the payoff of the $28.6 million because at that point that was still on there. So we continue to make payments for that. What we did do though is we did reduce the amount by about $16.9 million of interest that's been capitalized. So we have bonds in a reserve that we're utilizing to pay those bonds, to pay that interest over the next couple of years. Now understand that that approximately a little bit over $ 20 million was amortized over the remaining life of that iss uance. And so again, we'll be paying for that, but over the life of that debt. The next slide is, I know it's kind of busy, but I wanted to again point here to you. This is the $939 million of debt principal and interest that was outstanding at the beginning of the fiscal year. So certainly we'll have principal and interest payments in this year. And so what we're projecting in 18-19 under this current proposal by paying off $28.6 million worth of debt that's included in this $48.9 million, we would have of debt $848 million of principal interest debt on the city's books that excludes about $60 million that's in TMPA's side . That's not reflected here, shown here. Tony, what may be helpful in this regard too is because I'm hearing you say that that ending outstanding principal and interest includes the debt financing and interest, is that correct? Yes. All right. I think it would be helpful to just sort of also split that out because let's just say it's $200 million, which I think is a little more than that. But now you're down to $648 million, $649 million. And it is broken hour here Mayor, excuse me, and this revenue bonds. So this is the debt that's associated with the debt that we'll be paying. Okay, so you could just put some kind of parenthetical on the end there to say, okay. All right, thank you. Now this amount, just to be clear Mayor, does assume what we've done is we've taken out $10 million from the DEC debt and moved it up to what would, well actually no it's not right. That wouldn't be right. And the performer for the DEC debt, we have excluded $10 million of debt service because we're going to be paying that with base rates for DME, for the other electric projects. So then maybe when I was looking at because you said in the revenue bond interest and revenue bond principal, that is really the DEC. So that's the, that's. This is the total debt service. For the DEC. For the utility bonds, we could separate this out on what would truly be the DEC debt, and then the other $10 million that would go to the projects. Yeah, and then your outstanding principal and interest which is the total amount of debt up there at the very top. You've got projected as 905.4. You're saying a couple hundred, there's some portion of that that is the total DEC . Yes, and so if it was, because then you're able to say okay here's what the deck is here's what the other system that is because I think in some ways, I won't say excuse it but that's, that's more than 20% of that debt so I think it's important to be able to say okay, here's what this is. And here's the rest of the system. It just is more. I think it provides just a little bit more clarity on the actual situation. Yes, Councilmember. So just for extra clarity. So, it's my understanding that 18 million a year is what we have to pay on the debt service for the deck. And so, when that is adding both of those principles and that line right there is all deck. Okay, correct. All right. The next couple slides that George will come up here. Thank you. So we talked about purchase power being a very critical element of the forecast for the budget. Things that are not totally controllable to us but we have to manage to that that's one of our biggest priorities and historically we've done a good job at that. Some of the assumptions are that the deck is operational by July one. And we think it's going to be earlier than that which is good. Second, that the TMPA Gibbons Creek plant will be operational through September. That's already started up this past weekend. Everything looks fine. So we're thinking that's going to happen. We use forward market prices that we get from Standard & Poor's to predict what the market profile is. We look at 8,760 hours per year and we match the output of all of our units to that profile. And we figure out what our revenues are going to be or for our load we have to buy all of our load from that same market. What our cost of the load will be. We've got Blue Bail Solar One coming in operation by January of 2019. Possibly comes in a couple of months sooner. Good news is the wind project we just talked about that is operational last month. So that's 150 megawatts of very attractive priced wind energy. It's going to be really nice this summer if we can keep the wind blowing during the daytime. Gas prices as per the NYMEX forward curve. So we're trying to legitimize all of our assumptions plus any adders that we have to have for getting it from a supplier. Good news, all of our resources are pretty well locked in price-wise with the exception of the deck which has a gas component and a variable cost. We know what the price is so that's easy for us to forecast . And lastly, Tony talked about the load forecast. That's a big element in our forecast. And we had an outside agency validate our forecast. Kind of looking back at five years and amortizing and levelizing that. So because it's so critical, you know, right now, as I mentioned, the market's looking a bit wild this summer. Prices are as high as we've ever seen them in air-cot and that's good and bad. For those that have a whole plate full of resources and they run when they're supposed to run, it's going to be good for those entities. So power supply, that's one of the reasons the deck looks really good this summer and next summer. But we wanted to say, hey, what is going to be the impact on our budget in case that market softens? Right now we know it's pretty high, but maybe as we get closer to July and August, which are the prime months, market will disappear. So we ran a softened air-cot forecast and said, okay, what will happen to our budget, the budget I showed you today? And it wasn't bad at all. It looked like the sensitivity that we ran that there would only be an increase in our purchase power budget of about $2 million in '18 and about $2.6 in '19, which is manageable. And to get to those numbers, you can see what happened in ' 19 is the deck lost $11 million in revenue at a softer market. And TNPA coal plant lost about $4 million, but that's offset by the fact that our purchases of load were less. So we had to write a lot smaller check to air-cot for our load consumption. At the same time, we got smaller checks back for our resources, but the net effect was only a couple of million dollars. So I show you this because I was concerned that maybe we were over projecting what we might make from the market this summer. It doesn't, you know, maybe hurts the deck economics, but it doesn't hurt our overall budget as much because there's only about a $2 million impact. So again, as we go forward, if you think about it that way, everything we sell here, we buy from air-cot at whatever that market price is. And when you hear them going up really high this summer, you know, we wrote a check for our load for that number. But at the same time, everything we're generating, including the deck, if it's operating, we're going to get money back. They don't necessarily credit each other. They're two separate streams of money, but that's how it works. The deck. I'll whip through these kind of quickly. We've got a heat rate, we assume. Actual heat rates are coming in, came in well lower than that. So that's a very, very good thing for us. Gas prices at 9x forward curve. We're not predicting any outages for 19 because we've got a brand new car, so to speak. It should be running. Some of our deck capacity we use for what's called ancillary services, A/S. We can make a lot of money with ancillary services, and so we'll use the deck for that when it makes sense. Same market profile. The deck, we're limited by the permit, the NOx emissions permit, to about 3,100 hours per year. I think that was mentioned earlier. That is about a 30, excuse me, 35 percent capacity factor. And our actual operating hours for FY19 was only about a 27 percent capacity factor. So when we modeled the deck against the market, and we didn 't adjust that at all, it only ran 27 percent of the time. So we're well under the limit under the permit. Councilmember Maltzer. I'm sorry. I just didn't understand exactly what are the an cillary services that we can provide at a profit? There's times I don't understand those either, but yeah, so there's three or four different commodities that ERCOT requires utilities to have. It's like responsive reserve, non-responsive reserves, what we call reg up and reg down. So the power resources out there, you know, the load changes all the time, and there have to be flexibilities in the resources that are available to go up and down to match when folks turn on lights or turn on a motor at a plant. So we're required to carry our part of the what's called an cillary services that adjust the output of the system to whatever the requirements are. And the deck is good because it can do that very easily. It can start up in only five minutes, and it can ramp up and down very quickly. So it will become what we're going to use for ancillary services versus writing a check. You know, the alternative might be we have to write a check for that. And so that's going to save us some money. And we're crediting the deck for that revenue to the extent it provides that service. To the extent I understood that, is it different than actually running the engines when you're doing those? It could be, yes. So if your engine is online, there's one component of an cillary services that's just being ready to go up or down when they're called upon. So that's that spinning reserve element. You have to have some unsynchronized generation that can go up very quickly without actually having to turn the unit on. So yes, sometimes you can get paid for doing nothing. Okay. And is that a significant part of our revenue? It's only a couple of million dollars. So at this point, that's all we're projecting. But it could be much higher than we've seen in the past because of the market happening out there. I see Jose over there from our EMO. He's shaking his head yes. So we also project what the variable O&M cost is. That's gas and consumables. And that's what we bid in. We want to get back all of our variable O&M cost every time the deck operates. We don't want to lose money on a real time basis. Even if we can't cover all the fixed expenses, we want to cover as much as we can. We certainly want to cover our variable. We're using the debt service that we talked about earlier as part of the bond repayment schedule that Tony talked about. And we're also looking at all the other expenses for the deck, such as labor, consumables at the power plant and those kinds of things. So this is a profile of the deck based on our best forecast at the moment. Councilmember Briggs, I believe had a question. So when we're looking at the revenue here at the top, that is including an ancillary services? It is not very much. Probably only about a million, million and a half. Okay, but we are counting that. Okay. And is it also Councilmember Hadsworth brought up a good point? I think you touched on it a little bit at the amount of time that they're running. Are we estimating this revenue here on the chart at running its full capacity? No, full capacity is 35% of the time. And so this is at 27? 27%. And like I said, it could it's going to be based on the market. And that's our assumption at the moment. Right. Could be more, could be less. And in future years, so let's take a look at how the revenue goes down in the 2021, 22, 23 timeframe. We're projecting the market to get back to more normal levels. The prices aren't going to be as dramatic and as scarce. Power won't be as scarce that the market will have some years to build new power plants. Some new renewables are coming on. And so therefore out there, we might only run half the time that we're projecting for this summer and next summer. That's, you know, so that's one of the reasons the revenue that's what that's why a lot of that negative net income down there is so big because we presume the market was going to go away from us. And we're going to drop from about a 36 million dollar revenue down to about 20. And you can see that 16 difference would more than make up what you're seeing on the bottom line. I just didn't feel good projecting that. I just got ahead to feel that the market's going to get back to normal at some point. And that some point will be in that that timeframe that we 're projecting. I do want to say I took a tour of the plant. And if money money looks fresh, I just think yeah. So, I mean, I would certainly and I think there's going to be an open house in the public hand. But no matter what your thoughts are about it, I mean, really, it's it's the guys out there that are operating and Chris gave me a tour out there. It is just a unbelievable piece of engineering feat. I mean, it's just so it's here. I think we've got the right personnel out there. And it was just interesting to see because it was running when I was out there because of just the emissions testing. So they're they're finishing it up with the paving and everything. But it's quite remarkable, especially when you walk out of the engine room and you shut the doors behind you. The sound difference is unbelievable. I mean, the difference between when you're in the engine room and when you're outside, you just it's almost it's almost non detectable. So no matter what, if I'm asking for things to be split out , that's not saying anything other than let's look at it from that standpoint. But if you go out there and look at it, it's it's quite a it's quite a project. So I just wanted to say that because I was I was very impressed with I was certainly very impressed with the personnel and the plant manager out there and just everybody who's who's committed to really operating that thing in the best way possible. I'd like I'd just like to kind of chime in here. I appreciate you saying that, by the way, that they've done a great job getting that online. This slide, I know that at first it's it's pretty intimidating and it looks as if we're telling a very negative story. I just want I want the council in the public to really understand how we approach the budget here this year. And, you know, we were concerned, I mean, obviously, once you get past the next 18 to 24 months, our level of confidence goes down in terms of, you know, these numbers, we could be off of new technologies are more efficient may not hit the market. There may not be the demand there, but we tried to put together a very middle of the road conservative budget for you. It didn't overestimate where we were George's planning. I think the numbers to councilman Briggs point, it can be run about 31% of the year we're planning on 24 to 27% as you get out in those years four and five. It's probably closer to 20% of the number of hours. So it's a conservative budget. We are nervous. We don't have any history with it. We've tried to take some of the scrubber debt out save some of that interest money as we're sitting on some cash right now. That was a big deal we did we are not necessarily looking at going in and lowering rates and a huge matter at this point while we're still gathering data. I think that was important and it was the other reason that we scaled back to see IP so much we wanted to avoid any future debt. Those projects that would be nice to do but aren't necessary right now we move those out for further risk mitigation. So, I want the council to kind of understand that we don't feel that we don't feel that the strategy right now is anything but very conservative we're hoping that in these last two or three years that the pictures a little bit better but we wanted to make sure that we were controlling the debt controlling those things that we could control in case we're off on the numbers. A year from now, we're hoping that we're going to have a little bit more better picture for you and more data but we 've got backup opinions from enterprise risk who helped us with our renewable strategy just have another set of eyes on on our strategy and our numbers but we really are trying to put together what I'm hoping that these numbers are easily exceeded but we felt it was important to take a very conservative middle of the road position on this until we start gathering data. And I just kind of urge you at this point, not to get too concerned with years four and five yet. We're showing losses, but there's a lot that goes into that about what's happening to gas with how, how, and how much less frequently we'll be running the engines and, you know, where the markets we say at that time, the honest answer is we don't know right now. So we're trying to control the next two or three years the best of our ability and I just think it's important to frame this slide in that context. Well, while we're seeing this and I appreciate you saying that. We're trying to frame this and that when the public looks at this. Right, and I think I heard you earlier saying that some of that wind that we bought is actually going to help us very good this year, and be helpful with the deck loss, I mean, so I just wanted to go and state that publicly so there wasn't any confusion in the public. Yeah, so manager you, you said, conservative middle of the road, which is it is a conservative, or is it middle of the road. In other words, if it's middle of the road is there a range around it, where their likelihood is just as great that the red ink will be greater as less. And what's what's that sort of reasonable range, what's the sensitivity. I think we're, we are at a confidence level right now we feel comfortable with the rain, we could have been extremely bullish the next two years, we felt like that was irresponsible. You know we're hearing we're hearing a lot out there in terms of the, the energy shortages potentially should we have a very hot summer that sort of thing and along with all the megawatts have been taken offline so we basically had a range built. I would say from roughly 20% of the eligible hours to the 31%, and we budgeted right around 24. We feel comfortable with that, I did not want to get too bullish because the last thing we would need is to show that a net income of 25 million and for that to feel like a loss. Over the next couple of years, and so it's all about setting expectations and building our rates around it so we took a we took a strategy that put us right in the middle of the ranges that that our experts were advising us on. And then we started taking out as much of the fixed controllable costs we possibly could in case we're wrong. So, you know what's within, you know, there's no precision really available here but you know within kind of 50% probability. How wide is that range on years four and five could be as bad as, or could just as likely be as good as George. You know, ERC also ran some numbers for us and to be honest with you the range can be very very large, you know, just depending on, you know, do we have a cool summer. You know, do customers heed all of the requests to cut back on their air conditioning consumptions and all those kinds of things, you know, is everything running that's supposed to run. And so, there's a there's a wide range but years four and five could be as good if not better than what we're projecting for the first two years. I mean, that's within the realm of possibility. It hard to say what the probability is it could even be a little bit lower but you remember the sensitivity slide I had a couple of couple of slides ago, you know, looking at the overall big picture, how much we have to pay for load how much we get for our resources, and then the net impact of the market going up or down. When we roll everything together was very small individually it might make a big difference, but when we roll it all together it was a very small change that well within our tolerance to to deal with. I like that I like the question you've asked and I think kind of piggybacking on the mayor's earlier point. I think an interesting policy discussion with the council we feel fairly confident the next year or two and I think, I think, one of the policy discussions we'd like to have with us if we exceed our plan here in terms of revenues, net income. I still I really like the idea of kind of putting that out of segregated fund balance that would it could be moved in, in years three, four and five until we get a little bit, but we're going to be the way this will work is we'll continue to watch what happens with the gas pricing will continue to watch what happens with any new units that are put on and continue refining our estimates but we've, we're at a point right now where I think building up in a stabilization fund by. If we exceed our net income still keeps the budget integrity at this point but it also allows us to deal to further mitigate risk in years three, four and five as we 're as we're learning on the fly and I mean that I'm that's about as specific as we're going to be able to get for you today I'm afraid. So, so, yeah, did you want to have the consultants address that if they have anything that they could add to sort of that. The confidence in that forecast model. Yes, thank you Mayor and council members. We were asked to do a projection for the deck. And to answer your earlier question. This is probably the most challenging time in 20 years to do those sorts of projections. We talked to the utility board last night and gave the example of about 20 years ago you were seeing the market, making a major shift from coal into gas, and that led to a lot of uncertainty as to what the resources would be in the cost well now you're seeing more renewables come in. And it's leading to a lot of uncertainty or caught has has a lower reserve margin than it has had in the past and with a hot summer that's caused a lot of concern. Some people might even say panic there are some extremely high prices being paid out there. So it's a challenging environment to make a projection we were asked to do an independent projection are probably our , our base case was a little closer to the softened the case but it's a wide range and we could easily be low. The projections you're using could easily be low. If you could tell me how much of potential drought you might have in the summer of 2019. Those projections could be even be higher. So there's a wide range here and unfortunately we're at a time where it's a wider range than would be normal in terms of those projections. So, that's where we stand I think Todd did a very good summary of where you are. If you go four or five years out gas prices will likely be low like they are now, but it's a matter of what the heat rates are. And that's something that is really off the table in terms of the ability to project the next year or two are going to be more certain is Todd said years four and five, we wouldn 't even try to venture what that would likely be. Okay, thank you. Appreciate it. Thank you for the comments. I want to piggyback on his comment about the uncertainty in the market and that's one of the reasons for that ECA we talked about earlier. That's how we deal and manage or how utilities deal and manage with that kind of uncertainty. So you've got this balancing account basically so I'm going to move on if there's no other questions and if there's some come up we could talk about them again on the deck. I had a question on the dad didn't see in there, because I know that we've got a warranty on that that equipment I think for a year. So, it will be the next budget cycle where we're considering what kind of maintenance protocol we put in place either through a maintenance agreement or something like that is that is that why it's not in here just because correct that you're covered. Okay, so we'll be back with that and we'll bring you some options for that. Okay. Okay, and then we'll go to Councilmember break so I just want to make sure that you know I understand this enterprise correctly. Does the deck in any way, serve to, you know, firm up our own energy supply or is it entirely a financial strategy. You know I prefer to look at all of our resources as a technical hedge against our load, because they bring us credits that help reduce the net effect of that load costs that we're going to have so in the old days we used to combine them and that's why we have complexity sometimes talking about these things in Denton because our resources will always below our load. So we just said okay well there's the net amount of load that we have to pay for it. And that's the number we used to talk, but now our resources in 2019 will actually exceed our load. So we actually have a pure hedge. It won't match our load hour by hour but on an aggregate annual basis. We have enough resources to cover entire load. So, everything separate. And if we didn't have the deck we would be writing that 20 million and savings we would be writing a check for that I tried to mention that earlier for the load that we would buy, you know if you kept the 20 million said okay don't touch those dollars, not just an accounting thing, but let's not really touch those dollars, then we're going to have to find another 20 million technically to pay for it. And so those two things. They offset each other and so in a way that is a hedge that is firming up our load so to speak. There's no technical requirement in aircott and you heard our consultants talk about that if you did back late last year to firm resources . However, my prognosis is someday in aircott that will have to happen. You're going to have to move to a capacity model, and they 're going to have to allow and promote resources that can do do what the deck is doing. While the decks not required, nobody was required to build it there are no one's required. It is a very good resource and there's a lot of people in Texas that are very happy that we put that deck online, you know, right or wrong, they're happy that it's going to be available this summer to help during this mini crisis, all the way from the governor's office on down. crisis, all the way from the governor's office on down. And I'm not a customer breaks did you have a question or comment in the I did just in general because I know that we have a green sense right, because we're, you know, eventually all going to 100% renewable but now, or in the past I don't even know if we can still sign up for 100% renewable rate is that you can still do that. Okay, so how does that factor in and as far as the, the rates go and the percentages in will that of course that option will will go away as soon as we. I think it needs to be revisited in light of that the utility is doing 100% renewable right. And is there still a value to the rest of the customers, because our money belongs to everybody to given discounts for, you know, green sense type investments, I'd like to think we can still I'd like to think we can still do both, you know, concept ually you know philosophically I'd like to think we can do both, but we're going to be looking at that a little closer as we go forward. I think Georgetown still wants to promote behind the meter solar even though they might be 100%. I have to scratch my head a little bit on that but maybe I can, you know, maybe I can get adjusted at some point. I wasn't talking about that. No, I'm talking about that but green sense I mean promoting renewable energy or. That's the concept I was talking about. Okay. Well I was just wondering if the rate that we have because I pay a separate rate I think right now to get 100% renewable energy yes. And so eventually that will all level up. Or do I need to, if somebody is on the renewable rate do they need to call and get off. It's not very, you know, we're still a couple years out, but when we're 100% I think that you're right, it doesn't make sense. Okay, yeah, we'll be revisiting that and we'll bring that back to you at a later time. Thank you. Sorry about that. Okay, moving on. This is the standard department type budget presentation. These are the positions, the changes. We're putting two positions to the deck in case it makes sense to run 24 hours a day. I haven't fully staffed it from an operator standpoint, if we do have to run 24 hours a day for some short periods. We're going to look at that re aligning the people we have, but we couldn't do it on an extended basis so I have those positions there in case we need them. At that point we'll pull the, we'll go forward. And then there's about another 16 positions we're transitioning out of our organization to some general city organizations that they can provide support for us as well as other folks in the city. So, pretty well talked about the goals and accomplishments in that earlier slide, continuing to promote reliability, promoting renewable resources and maintaining rate competit iveness by managing our power supply in the best way possible. Talked about the deck already and the fact that it's reached mechanical completion. We have a really great TND group, engineering group. We've put a lot of projects in service over the past year, and we 'll continue to do that moving forward. And we talked to you earlier about moving to the platinum level under the APPA reliable power provider program. And this slide in particular the pieces I would pick out are the reliability improvements we're continuing to make. We think customers in addition to rates, they want reliability, and we're looking at these special trip saver devices that are programmable fuses that are smart fuses that make a lot of sense and can reduce the return to service time for customers. We're getting those out there, doing more of those feeder sweeps with wildlife protection that we talked to you earlier about. And there's some underground cable that's what's called direct buried. It's not in conduit. Standard practice today is put the conduit and put the wire , put the conductor into the conduit. These were direct buried back in the old days, and that's why folks did it way back when. But they're failing and impact and reliability, so we're out there trying to get those replaced as much as we can. George, you got a real quick question from Councilmember Gregory. You were going so fast. I know I'm trying to get you. Oh, but we love it so much. Back to slide 21. Sorry, here's. So, with the reduction of FTEs, where, where you're not going to be having people on the DME budget, performing these tasks. So, is that going to impact. Are we going to see an increase in the cost of service that's the city charges for providing those services to DME. Yes, it's it's being managed by tech services, but there should be it's just more of an accounting issue that there should be no net increase the general fund and similar cost to DME. It's just where it's being managed from. Because we've always been trying to be very careful that taxpayers are not covering the cost for operating DME. Correct. And so, so, you know, we charge them for for their portion of HR for legal and those kinds of things. So, if, for example, if we're losing. Okay. Tony's been charging us. Brian almost made me up here so. So what we've done is we've moved those we have a separate internal service fund, technology services and then those costs will be allocated back to DME from that fund and paid to that fund. Okay. That's what I think you. That's a very specific answer. Long question. You're gonna miss me so much. Okay, last comment on this slide. I'm sorry, Councilmember has been after. Yes, and it's, I'm totally at a sink with with your where you are in presentation but I just want to before I forget it. I just want to make sure we before we take ownership of the day, and I know we have a year to. But I just, here's my concern. After a year that we have some mechanical flaw or something that was detectable before then right I mean, because it's no secret that this project is tenuous at best anyway. And so what I absolutely want to do is make sure we kick the tires in every imaginable way that then allows us to. That for me to be I mean I'm just saying a forecast to if two years in we say oh by the way we didn't realize the concrete wasn't poured deep enough or whatever it is. That is absolutely going to be a nightmare so I just but while it's not on our ledger I want to make sure, or even during that year, I just want to make sure we're absolutely uncomfortable with all the work that's done and yanking on everything we can to make sure if it breaks it breaks within that first run. Absolutely. Okay. So, even up to this point we've done tremendous number of inspections everything's inspected all the systems all the subsystems. And we make we kick the tires we've already done that and we'll continue to kick the tires over the next year to make sure when the keys are fully turned over to us and we have nobody to go after. If there's a problem that you know we've done our best to minimize anything like that so. And I want to echo that because I, you know, when I was out on the tour talked with Jason I believe is the plant man Jason's name. And we talked about that. We talked about, you know, service agreements and the cost of those and what could go out and buying additional parts and so you know I feel very comfortable and confident that that staff and DME staff, they're doing that because it is expensive. In fact, he showed me an example of a spark plug, because these things have spark plugs, and that the word Zilla spark plug and then an off brand spark plug. And that how many hours you get from one and how many hours you get from the other, and the cost that could be if one of them fails, which wasn't your, your, your, your OME or OEM or OEM. So, no that that conversation. I mean just a little conversation that I had. I'm sure that that's going on ten fold behind the scenes so I just wanted to share that because I think it was very beneficial for me to go out there and see that and talk with them and see their commitment to that plant and the maintenance of that. Great to know. Yeah, and we were patting ourselves on the back and Jason was patting himself on the back we really got people that know what Zilla, they know these kinds of machines they have experience Jason has a lot of experience our plant manager. And, and we've, we've got a number of mechanics and electrical technicians on staff, and they're going to be doing the maintenance, it's kind of like do it yourself versus turning it over to warts so that flying from Finland , though they don't quite have to do that but it's going to be quite a bit less expensive if we can do a lot of that kind of thing so Councilmember Riggs and then Councilmember Ryan. So I see on there the LED streetlight conversion. That was the one thing I was going to talk about next. Right. Oh, okay. I was out of the room and I thought we'd already covered them all and I was going back so before you. What do you think, Councilmember Ryan did you have something before, because he's going to just go down the slide did you have a question I thought you had a question. Yeah, I did. I was just kind of as far as when we talk about reliability. And if the summer is as bad as they're talking about with with loads and in the grid being taxed to its maximum. Right. Does having the deck have any effect on our reliability based on its proximity. Basically it's tied into our grid that's tied into the overall grid. I'm sorry to say it's all for one and one for all. So when there's an issue out there and reducing load and dentin will benefit you know at that point perhaps the decks already on and it's being considered before aircott says hey, there's too much load happening in this part of the Dallas area. Everybody, you know, they'll be pointing to each system and saying, we need you to shave 5% or something like that and we'll go through our rotating brown out program, which we've updated and make sure it was . So we'll be doing that and the deck unfortunately wouldn't make a difference in this interconnected world that we're in. There's times when we get benefit from others things that other people are doing, and there's times when they get benefit from things that we're doing and the deck could be one of those things. So, we hope we hope it doesn't come to that, but it could. So LEDs. So we did budget some money for LEDs we've got money in the 19 and 20 budgets, million and a half each year. We're looking at doing a retrofit program. We're looking at coming back I talked to the pub yesterday about coming to them and just getting their ideas about hey where should we do this, you know what parts of town make the most sense. We're looking at main thoroughfares we're looking at some neighborhoods kind of wanted to do both residential commercial, and we talked to folks in house also that have expertise that community development and economic development. So, and I don't think when we come to you we're going to have a lot of firm ideas so this might be one that's just an open question do you have some thoughts about where you'd like to see us put LEDs in. To me it's a better quality light it's a white light, and we're intending to increase the lumens out there to make it brighter and somebody older neighborhoods where you know back in the 60s and 70s and 80s, the standards were not as high as they are today for lighting and so you're going to find those levels to be a lot less so question. Yes, I'm really glad to see that we had a presentation from the man in charge over there sitting in the audience. And, no and we really have some dark areas in our town. You know, even though there's a light right here it doesn't necessarily cover the whole area. My question is in another committee we heard about GIS technology that would be implemented with these lights at the same time so that out ages would just be known, but we wouldn't be relying upon a human being or a person driving by at night stopping and getting the number off the pole and saying, this light is out. Is that also. I'd like to do that. Also, it's not inexpensive so you're putting in you're taking the photo still out and you're putting in a smart controller that will communicate with our automated turn on and turn off network for the meters. So, it's not inexpensive but I think it makes sense and we 're going to at least do that in some areas to see how it works and so forth so. Yeah, I think it's great. It's a shame sometime we it's hard for us to find lights out. You know all around the town. And that would make it a lot smarter and easier. And you can also turn lights up and you can turn lights down. If there was a reason to do that. So those are some things we'll be exploring. Any questions on that. So here's our capital plan for five years it's a total of 169 million you can kind of see the total down here about three quarters down on the right side of that 169 million we're planning to fund right now 65% of it with cash. And we did in the past, that's how we're trying to draw down our, our debt that's out there is by starting to cash pay or significant portion of our, of our CIP program. The part that we do, we may go ahead and finance will be the transmission piece because we're able to take those through the T cost and get that recovery from aircott, and maybe that will, there's some sense to doing it that way, but the distribution side of it will will go ahead and pay out of our pocket. And that's part of our plan. So, we've reduced the, the CIP budget from what you've seen in the past but you know those big numbers we saw in the past we didn't do 100% of those numbers. We did some percentage maybe 40 or 50%. And what these numbers though we do intend to actually spend these numbers so I, this is not going to be one of those where we're going to spend 30 or 40%. We're going to spend it all, and checks got an idea for every dollar that's in there. So, so it's a little different philosophy of doing CIP budgeting. You mentioned T costs and that T costs and transmission. Was that was there a line for those. Was that shown in our budget. I guess I can go back but I showed the expense side. Okay, and because we didn't show the revenue side. Let's see if we got a special slide in here. I don't think we do. Yeah. So, so the revenue side is integrated into our budget, so we're getting money back for T costs, the work that we've done to evaluate T costs says that right now the monies we 're getting in are roughly equal to what we're paying. And so it's actually working out pretty good for us. Is there a way that you can send something to counsel where we can specifically see that amount, because I know that, you know, a couple years back we were doing the transmission and, you know, spending 400 million on the transmission and we were told that that would come back to us and so I'm just kind of curious of what we spend and what we've received back so far. Yeah, when I arrived in Denton I was skeptical to I'd heard those stories and when I dug into it, it seems like it. That's what we've been getting so you know that point something percent has been coming back to us. Most of it is to repay the debt associated with those projects. There's just a very small part that would be, you know, kind of a return for us. Of about three and a half percent so we'd be happy to show that to you. Yeah, that would be good. Not not right now. You can just send that to me later. Tony's breaking system right there. Tony says you can answer that in five words when it takes me 50 so. I just like to see wouldn't think that guys in the financial department would be that precise. I mean this guy . Okay, so if I if I understand you'd like like an ISR and a Friday report just talking about how teak house works and where we stand. Is that what we're asking. Wait, just in the in the conversation of transparency. I just I mean I'm sure I just like to know we have that information. Okay, happy to provide that. Thank you. However, you can want to tell me. Yeah. We show you the numbers. I think numbers are the best best approach. So kind of move through this kind of quickly. You 've seen this before. It probably in past budgets. You've got our distribution system projects is about seven major projects we have and we have handouts. So you mentioned Jerry earlier. This is Jerry fielders part of his kingdom here at DME. He 's also responsible for making sure we serve new customers. The second map we're going to hand out will be showing all the new customers we have residential non residential multifamily and commercial. So thank you. Okay. Thank you. Yeah. So these are in the backup that you got. We just thought we'd give you hard copies that you could look at wasn't planning really to talk in detail on these today. So we're going to show you a couple of them. We're going to show you a couple of them. We're going to show you a couple of them. We're going to show you a couple of them. We're going to show you a couple of them. We're going to show you a couple of them. We're going to show you a couple of them. We're going to show you a couple of them. We're going to show you a couple of them. We're going to show you a couple of them. We're going to show you a couple of them. We're going to show you a couple of them. We're going to show you a couple of them. We're going to show you a couple of them. We're going to show you a couple of them. We're going to show you a couple of them. We're going to show you a couple of them. We're going to show you a couple of them. We're going to show you a couple of them. We're going to show you a couple of them. We're going to show you a couple of them. We're going to show you a couple of them. We're going to show you a couple of them. We're going to show you a couple of them. We're going to show you a couple of them. We're going to show you a couple of them. With that, I'll let Tony back up. >> Mayor, City Council, we certainly appreciate your time. I just want to, again, just recap really quick for you, kind of what we've heard today. The forecast that we provided, you know, we can view that as option one. We'll certainly work on a couple of other options that we 'll bring back to the council for consideration, kind of walk you through kind of the same kind of process, maybe not as many slides, but certainly show you the underlying assumptions that go into the other options. I will, you know, do want to go back to one item. That's the item that we have for individual consideration for tonight. And that would be to utilize $24 million of rate stabilization money that's already in that fund to cash fund the majority of the current year CIP. Many of those projects are already underway. If you recall, we previously had planned to issue CEOs for those projects. We've elected not to do that. There is a notification process that we would have to theoretically go back and restart in order to be able to issue those bonds if the council preferred to go down that route. Our recommendation, even in another scenario, would likely continue to recommend that same strategy, at least for 17- 18 as the base year. So what I'm hearing today is, again, we'll come back to you with different options. Our recommendation and where we're seeking direction from you would be to move forward with this budget amendment, utilize $24 million of the current reserve for that fund, along with $10 million of what we believe, again, is going to be excess utility system revenue bonds from the DEC that could be used for that purpose. >> Councilmember Malauulu. >> I understand the merits of using the money from that fund rather than adding to our bonds. I just would like to understand why did we initially or previously think we needed $24 million in a rate stabilization fund and what has changed so that we no longer think we need it there? >> Well, certainly we have an excess of $24 million in that rate stabilization. Again, this is part of the strategy to continue to dele verage this fund from the amount of debt that is out there to get this fund to a more reasonable level of debt. That was the underlying goal, one of the goals for this fund. >> I understand the debt part, the deleveraging. It's the rate stabilization part. I don't understand. What tells us that it's excess? >> We have a significant amount of cash sitting on hand right now that we feel is best spent retiring the debt at this point. We're still able, even with doing that and even with paying off the $28.6 million TMPA debt, we're still in excess of our reserve policies and feel we're in a good situation heading next year. What has changed is the CIP has been scaled back, revenue needs have been scaled back, thus the need for that kind of debt has been scaled back. That's what's changed. It has nothing to do with the rate stabilization. It's more of a matter of cash on hand and less requirements to the CIP, needing debt financing behind it. >> Can I follow on that? >> Sure. >> What has changed in our assumptions on CIP? At one point, we felt we needed those things. There's probably a very persuasive presentation about that. What has changed in our assumptions about that? >> I'll go to George again. One of my early tests at DME was to look at the capital program. My conclusion was that the projects were good, and in the long run, pretty much everything made sense. I didn't really move anything out of that budget. But a lot of that was serving, I felt, needs that were five and 10 plus years down the road, maybe 20. And maybe we were taking advantage of a T-cost opportunity in the short run versus what we actually needed to do. So, you know, we have 100 -- as the mayor mentioned, we had a $100 million capital budget. Our total base rate revenue is like $85 million. The scale of the program was well out of line with what we could afford or what we need. When you look back three or four or five years, we really haven't grown very much from an electrical load standpoint. But we've got a massive program to upgrade. A lot of that's due to the fact that we went to a more efficient voltage on the system. We moved from 69 kV to 138, and that precipitated a whole bunch of other changes. But the timing of those changes at this point are not as critical as we once thought, and we have the ability to move them out. So we're still going to do all the projects. We've smoothed the CIP, and we've picked a CIP that is actually what we're going to do and spend versus something that was well inflated. It was so big, we could never really do all the projects. So the changes -- a fresh look. A fresh look. And, you know, I worried about, hey, are we changing anything that's going to have an impact on our reliability? And the conclusion I have is no. And if that changes, then we'll be moving some projects in ahead of some others. >> Okay. So do you have anything else on this particular presentation? You just went over what we're going to be doing in the open session as far as action item and just explaining it. Any questions on that? There is one last thing I would like, and this is going along with the budget. I see Chris there. I believe project manager for the construction project. I really want at least an informal staff report just regarding how well that project has gone. They were telling me about the safety or the no safety issues. I mean, just very -- I really want a pretty good informal staff report, notwithstanding where you are on the project, but I think that -- I think it's very important that we recognize a job well done on such a big project. So however you feel best to do that, I would really say let 's do that because I think the council needs to know how big it was and how successful it was just in the construction of it. Again, notwithstanding where you stand, but to get it done, get it done with the precision and the efficiency that we did, I think it's a job well done. So however you want to memorialize that to us, I would appreciate that. >> We can do that, mayor. >> You bet. Okay. Any other questions on this? A little housekeeping. We've got one more open session, which will be -- it's probably going to be a very short discussion. It's on the red light cameras. Just teasing. So what we're going to do is if -- we don't have an action item on the closed session agenda item, so if we get too close to the regular council time, we will move the closed session to after the council meeting. So I think we've got enough time, but I just want to make sure -- because we're going to have dinner probably arrive here in a few moments. So let's take about a five-minute break, and then we'll come back and start the next work session. Staff direction regarding the city's automated traffic signal red light camera enforcement program. >> Good afternoon, everyone. Thank you, Mr. Mayor, council members. My name is Preetam Deshmukh, traffic engineer for the city. Me and Chief Howell here, we're here to talk about the automated traffic signal enforcement program. And this is AKA, also known as the red light camera program . A little bit of details about how this presentation is going to be set up. First couple of points, bullet points, will be presented by me, and then Chief Howell will talk about getting to the depths of the actual program itself. A little bit of background. I just want to make sure that everyone understands traffic signal timing is separate than red light camera location. So we design traffic signal timings or develop and implement them based on state and federal guidelines. So we follow specific standards to do that. A presence of a red light camera is not necessarily we don 't modify any signal timing, don't make any changes. There's also a one-way feed into the camera. So the camera cannot send any signal back to the -- or any communication back to the signal itself. So there's no influence of the camera onto the system. So that being said, I wanted to talk about the pilot study. About a little over a month and a half ago, council directed staff to perform this pilot study for adding one second of yellow time and assessing its impact on red light camera locations. So we -- staff picked the intersection of Oak and Carroll as the intersection for this assessment. I think if you look at the list of intersections that we have, majority of them are currently under reconstruction or were under reconstruction when we got the direction. So that's why Oak and Carroll was picked up. The actual approach that's monitored by the red light camera is on Oak westbound. So just going towards UNT. And then the program actually, we changed the timing. The yellow timing was increased between the April 11th and May 10th. So that's the actual time when the system was changed. Now we compared the results of how many violations they had during that period for previous years in the same 30-day period. And here are the results. As expected, violations were reduced by 59% a year ago during the same period of time between April 11th and May 10th. And then about 65% a year before that. >> Councilmember Wright. >> Thank you, Mayor. Do you know when that was restriped from being three lanes to being two lanes in the bike lane? >> Yes, it was restriped in September 2017 last year. >> Okay. >> And in conclusion, yes, we expected the violations to go down. But I do want to point out a couple of cautionary things in that, which means if you extend the yellow time, it increases the time for someone to get into the intersection. It also increases or makes it more likely for that person to speed up a little bit. Long-term impacts or effects of this yellow time change, if we increase it, it's obvious that delays are going to go up and the congestion will go up. One of the other effects that you may see is since the study was only conducted for a month and not over a longer period of time, as the period increases, the driver tendency or behavior tends to change and slowly the violations may creep up to back to the original levels. And then finally, if we make any changes after looking at these results at the red light camera locations, it was recommended that the changes be consistent with the rest of the intersections throughout the city. And that would definitely increase delay. >> Councilmember Meltzer. >> Yes. Are there measures for delay and congestion? >> There are. And you have a follow-up to the question. >> Say more, then I'll say more. >> So what happens is every intersection, we have a progression. So on a corridor level, it maps how much time it takes for a vehicle to travel from one point to the other. So if you have a whole corridor, say you start at Eagle on Carroll Corridor and go all the way to University, it tracks the amount of time required to travel. It also tracks the number of stops and it tracks how long have you stopped at each stop. And based on those, there's measures of efficiency that are determined. And that's the actual standard that we can compare numbers using those. >> And how long do you hypothesize it would take for the delay and congestion to appear? Because you're saying it's a long-term effect. >> Correct. It's a long-term effect, meaning if the yellow time is increased by one second on each of these approaches, it will be -- the impact will remain indefinitely, depending on the volume. As the volume of traffic increases, the delay will continue multiplying, not just adding more. >> But we didn't measure it during this 30-day time period. So it strikes me that the conclusion is based on factors that we didn't measure. But would it be beneficial to do a study long enough to see the effects that you believe should make us not want that reduced -- the reduction in violations? Just to rephrase it, the number of violations I think we would agree is a good thing, subject to the constraints of not wanting to have delay and congestion. So wouldn't we want to do a test where we can measure whether we get the benefit without those harms? >> So one of the things that we're basing our -- this whole -- why would it add more delay or congestion is based on past research, previous experience, but also on the fact that we will be taking out green time from each of these phases to allocate it to yellow time. And that's the issue that -- that's a major impact that we 'll be having is the green time that's allocated for these two moves will now be shifted to yellow time. And I went into a little bit of detail last time when I presented how it's based on the cyclic fashion. So if we continue to add more seconds in a cycle, then the delay further goes up, too. So it's a cyclic thing. So if the person is standing on one approach, by the time the green comes back, if the cycle is larger, the delay is also larger. So in short, I hope I explained it. >> Councilmember Ryan. >> Thank you, Mayor. The standard that's used, the calculations based on how many lanes, what the speed limit is, et cetera, do you know more in depth what that's based on? Like on speed limits, we use the 85 percentile. Is there something to that extent what it normally takes? >> So based on last time I presented the formula, it actually calculates how long or what is the distance needed or how many seconds are needed when a car is traveling at 30 miles an hour. So if you're traveling at 30 miles an hour with a standard deceleration rate when you hit the brakes, it takes these many seconds to get to the stop bar. So that's the number of seconds that are allocated for the yellow time. So if I am entering the intersection right at the stop bar, can I clear it? So that's the calculation. It's based on the speed. So the higher the speed, the higher the yellow time is given to that approach. >> Okay. But I'm sure that there's some -- everybody has a slightly different reaction time. >> Correct. >> And so I'm sure that that has to go somewhere into that calculation. And that's what I'm wondering about is how do they figure out what the reaction time is from, you know, is it a tenth of a second, a half of a second for a person to realize that I need to change my -- >> I wish I could pull the formula back. I have it on this particular thing. The formula has two components. The first component is the reaction perception, reaction time, which is a second or a second and a half. And then the other component is the actual calculation for the distance and seconds in time. >> Okay. Thank you. >> Question. >> But these times that you're talking about, are they just guesstimates or were they developed somehow by some studies and some calculations, these formulas that you engineers tend to use? >> Correct. So these were developed by ITE, which is Institute of Transportation Engineers, and they were developed through years. I think their first edition came in 1965. So this has been an ongoing research, engineering, and establishment. So every time they come up with a new edition of their hand book and traffic engineering handbook, they go through, assess the situation. Is this really working? Are there any other changes that need to be made based on driver behavior, based on perception, based on new technology that's out in the market? So this formula has been continuously evolved since 1965. >> And that formula has been subjected to scientific review and testing so that it's not -- or is it just a theory? Or has it been proven out through actual research? >> Correct. It has been proven out through actual research. And it has been -- it keeps on getting better. >> Would the research -- or rather, would the formula have borne out and predicted the reduction in violations that we saw? >> The reduction in violations was expected because we're adding more time to the actual calculated yellow time based on the formula. So we're adding time on top of the actual yellow time. >> But would the formula have predicted the result we saw? I understand directionally why it would. The question is really we're comparing, you know, an empirical result, actual reduction in violations versus a theoretical but research-based projection about delay and congestion. So what I'm wondering is does the theoretical research- based formula, you know, would it have saved us all that time? Would it have told us that we would have gotten exactly the reduction we saw? Had we applied the model that, you know, you're saying would predict increased delay and congestion? Because I kind of like the fact that we have empirical results that, you know, look pretty good, right? I mean, on the face of it. So as I said, these results were predicted because the violations are based on when it triggers back to the camera saying now this vehicle is in violation. If you increase the amount of time that it gives the vehicle to clear, obviously these results were predicted. Now the formula has nothing to do with the addition of yellow time. This was a random one-second increase that we did. So I don't think any of that formula would have any of that research would have helped this particular little pilot program that we have. It just does make me -- who's that for? It does make me wonder if we would benefit by -- if it wouldn't have predicted the result we saw in reduction of violations. It makes me wonder if we -- especially since we have time on this contract, you know, if we ought to not see if in fact the delay and congestion you, you know, warn us about materializes. >> Yeah, I mean, it depends on what direction I get from the council. We can continue the study. >> Yeah, we'll probably address that as we get to the end of the presentation. >> Okay. The next portion will be presented by the chief. >> Good afternoon. >> Good afternoon. >> And like Tony said in his presentation, I get all the bad slides. >> Yeah, all right. So just to start in on a little bit of a background, the discussions on this program began in 2004 and the first report that was presented to council was in October of 2004 . There was a city ordinance adopted in November of 2005 under a home rule charter provision. This was prior to the state law and transportation code section 707 being adopted and I'll talk about that in a little bit more in a minute. There was an RFP awarded to red flex in 2005 and the system became operational in May of 2006 with six cameras at four intersections. There's been expansions and contract renewals that have occurred periodically. Each of those has been presented to the Traffic Safety Commission before the council and each of those has been recommended by the Traffic Safety Commission. So they first recommended expansion of the program in 2008. The council renewed the contract in 2009 with an extension of two five-year optional extensions beyond that. Traffic Safety again recommended and council approved expansion in 2013 and that year the council authorized the first five-year extension of the contract. So this brought the program to 15 cameras at 11 intersections. Since that time two of the cameras have been decommissioned due to reconstruction at intersections and that's at Hick ory and Bell Eastbound and I'm sorry Hickory and Bell and University and 35 Eastbound. There's always questions about how the intersections were selected. Prior to 707 being adopted the intersections were selected by mainly by traffic volume and traffic crash history. None of those were text dot locations. It wasn't until after 2007 that text dot locations were allowable to be added into the system. And in 2007 when the section 707 the transportation code was adopted there were the discussion began which led to several other intersections and approaches being entered into the system. Currently though the selection process for the intersections is a combination of traffic load of prior accidents of the complexity of the intersections themselves . So when you see the approaches being added at the interst ates especially like Fort Worth Drive and University it's one of the factors that are involved in that is the complexity of the different directions and traffic flow and the volume of the traffic flow and the difficulty of working those intersections with traditional law enforcement manpower. Many of those approaches. There's no place that people can safely set up to observe the intersection they're very difficult to see the intersection boundaries so that you can tell when somebody crosses into the intersection light turns red for traditional law enforcement to occur officers have to be observing that all of those things at one time and then also be able to be in a position to go after the violator and pull over and stop. So, to work those, especially those interstate connections and intersections and many of the other locations. It can sometimes take six to eight officers in what we call a pack to work properly work those and safely work those intersections and be able to go after those violators when they turn in any direction. And it's so it's a very expensive and time consuming process to do it under traditional enforcement methods. The violation process. Again 707 requires that notices be mailed out. No later than the 30th day after the violation occurs. So red flex reviews these first. When they download all the information, and they're reviewed I understand by computerized process automatically checks the functionality of the formula, and that's operating correctly. And anything that doesn't appear to be operating correctly can at that point, be not be passed on to the police department for further review. The videos are then made available to the police department . And again 707 requires that a sworn police officer review and approve the violations before they're mailed out. So the approved videos. Are the all the videos that are passed on are made available to the police department are then reviewed. And I 'll go over in another slide coming up. Some of the reasons that there will be continued dismissals during that review process. But the proof videos are mailed out to the registered owner of the vehicle. Red Flex provides a customer service staff person that is available to answer questions about payments and general information and also the city has a part time staff person that provides customer service to handle questions about violations help people view their videos set hearings. They also apply late fees if necessary. And any other issues that come up. And again during that process, somebody calls in to that customer service rep. The, the customer service rep will bring it to the attention of an officer to review that video, if there's any issues with it that might lead to a dismissal. There are several steps in here before it comes to an a hearing, which is available in 707 and administrative due process hearing. And here in our system, that hearing is conducted by the alternate municipal judges. And then Judge Ramsey presides over an appeal. So it's a two step appeal process. You have a hearing first one on one with the hearing officer and then appeal in municipal court to Judge Ramsey and he's here available. If you have any questions, detailed questions about that process. And just to give you an idea in 2017 the not liable findings on hearings and tolls about 80%. And there were eight appeals in 2017 two of those were found liable for the violations and six of those were found not liable. Did you have a question. And I don't know if it's you that can answer this question of the municipal judge or any of our attorneys around one of the comments that we hear in criticism of the program is that it's unconstitutional. Is it what has there been a court that has ruled that it's unconstitutional. Maybe that's for for a lawyer for the judge. I just talked briefly about it. There's currently a case pending in the fifth court of appeals in the Dallas area where a trial court entered judgment for against the city in favor of the plaintiff to which was based on a lot of constitutional arguments constitution is specifically a violation of his due process rights under the Texas and US Constitution. And a couple of others so that is currently pending on appeal. I mean a trial court decision is not binding on other trial courts although it can be used as as a form to persuade another district court judge. And so we are waiting for that court of appeals to actually enter a decision. I know the oral arguments were entered were actually conducted December of 2017 and it usually takes several months before the judge or me the judges at the court of appeals. Actually write a decision and issue it. So if I could follow up. So I don't understand the legal terminology. I hear people talk about it's settled law. So what I think I'm hearing you say is that there is an argument being made that it's unconstitutional but that argument has not been settled in a high court and currently it's considered to be. That's not settled. Yes, that is correct. It's once if the let's say if the fifth court of appeals out of the Dallas region actually enters a decision affir ming the deprivation of constitutional rights that these plaintiffs suffered. And that's that's more effective in across the state. We fall the city of Denton falls under the Fort Worth Court of Appeals. So, although it's not directly binding on us, you know, it could be used in a later case in the Fort Worth Court of Appeals to actually make it binding on all the cities within the Fort Worth region. Thank you. customer breaks. So my question is for the judge. Hello, Your Honor. So I think you said there were eight that came to your court, and two were of them. Most were dismissed but two were still held up for libel and not libel I think I'm just wondering if you can. I guess in some ways it's right not to keep stats and what I find what I don't. And I do have to make this caveat is, I'm not advocating for against I'm simply here to explain the appeal process right that's an only when it gets up to my court. So, did you have I think you did, you gave a stat. Yeah, I'm just wondering if you can help with libel and not like what would be. Yeah, the terms are actually not that they're dismissed the , the owner of the vehicle is either found libel or not found libel libel me that you owe for the civil penalty that success. And, yeah, I can't remember the exact numbers. Well, the numbers really there were eight appeals and I found to libel and six, not libel. Okay, so. Just to keep keep in mind that when when they make it to the to my level of appeal. I try to consider all the factual fairness issues that may be part of that. I don't know if chapter seven or seven anticipated that necessarily. But we try to. As a general rule and in our court I try to. I always err on the side of finding someone not guilty or not libel, because the law requires that I'm used to that standard of law, and that standard is, you know, that the city or the state has to bear that burden of proof. So to that extent if they raise an issue that hadn't been heard because it wasn't really available to be heard at the lower appeal process or administrative hearing. I'll consider that. Okay, and kind of unique arguments. Some of them do get pretty, pretty unusual and unique. Does that does that answer your question. Yeah, yeah, that's good. I appreciate that. Thank you. Thank you, Judge. Appreciate it. Judge. Mike. Thank you. I don't know if you're in a position to answer this because I don't know if it would hit your quarter not. But can you contrast for us, the remedies available with the red light camera versus the remedies that would be available. If someone were stopped by a live police officer. The majority of cases heard in my court are under the Texas transportation code chapter seven or seven is under the Texas transportation code, but it clearly makes the distinction between the two processes that are available. Majority of cases believe or not in in traffic court are criminal offenses. A lot of people are surprised that they they use citation they think it's not a criminal issue but some majority is criminal, which means that if the person fails to appear pursuant to their promise to appear. It can ultimately be processed for and they can be arrested , pursuant to a warrant that is not available under chapter seven or seven, a case that goes through chapter seven or seven photo enforcement is never ever eligible for one, either in this court, or in any other court by by statute. It also does not a case that typically if I get a citation that's issued for running a red light by a police officer. With Texas DPS, that does not happen under a photo enforcement. It does not appear on the drivers. In fact, it isn't even associated with the driver's history. It is associated with the vehicle itself I suppose or the vehicle is the one that's liable for it, or the owner of the vehicle, its responsibility vicariously by ownership, and by virtue of the ownership of that car. So it does not appear on the Texas driving history or any other state driving history. And if, and if unpaid the remedies are different again it cannot go into a warrant. But it would simply be an assessment against the owner of the vehicle. So there's significantly different processes. But is one hears that in the case of a live officer, you know, in the criminal charge that there'd be a right to a trial by jury. Is that correct versus in a traffic offense yet that's absolutely true yes. Someone has an absolute right in Texas law for a transportation code offense, a traditional rules of the road, chapter five, 500 five six six hundred. They haven't have a right to a hearing to a trial by judge or by jury. Yeah, one last one. And if someone comes to your court and says, it wasn't me. I wasn't the one driving. Does that have any have any weight. For which for which one, the police officer or red light. That's the important distinction. Yeah, and a traditional red light issued by a police officer. Absolutely. If they were in the car I'm not sure how they signed for the citation. I guess it could happen. And a photo enforcement, it is the owner of the car, it's set out by statute is again liability. And the analogy is really this just like when I own a home and someone slips and falls. Did I cause that maybe not but I'm liable for the by virtue of the fact that I own that property I could be held liable . If they can establish that case. So it's a liability issue as opposed to a guilt or innocence issue. And again if it's written as a citation the answer is yes. The other one now. Okay, thank you. Thank you. Thank you. Okay, onto some other violation data. You'll see this this graph depicts the light blue is indicates or the whole the whole bars on each year, indicate the total number of violations, both colors total number of violations that are captured under video. The lighter blue color indicates the percentage of those that are dismissed or not forwarded to the police department for review so you'll see that a larger percentage of the ones that are captured and originally reviewed by red flex, or the police department and or both are actually dismissed. And those reasons are multiple. When they come to the police department. The officers will review them under a standard that is the same standard that they would apply if they were standing there watching the violation or sitting there in a vehicle watching the violation, and we'll go after somebody write a ticket. There's also exceptions that are taken into account that actually are technical violations or blatant violations of the state law, such as making a right turn on red. The law says you have to come to a complete cessation of movement for you can continue to make a right hand turn, or it's a violation of the red light statute. The majority of right hand turns that occur on a red light. If the vehicle slows down under about 10 miles an hour, the officers will not forward those out to be sent as violations, based on what's what's classified as a safe right turn on red. If there's no other vehicle anywhere around that it could interfere with and it appears that it was just done at a slow speed. So there's also times when, especially at some of the multi lane intersections where the videos will not show clear depiction of a license plate, or the license plate and a description of the vehicle where you can compare to make sure it's the proper license plate on the proper vehicle. A lot of times, multiple vehicles are side by side in the camera view. And those are going to get dismissed and not forwarded as violations because we're not certain who to send those to. There can also be issues with the registration information. If the license plate is visible and we run it and it comes back as an old plate, not on the right vehicle or something that matter. There's all can there's also can be photo and video issues. And then there's a certain amount of police discretion at that standard that mentioned earlier that's also applied. So, if I mentioned the customer service rep, if, if someone calls up to that customer service rep for instance say the. There was a lady that called up one time that was taking her husband to get a cancer treatment at the hospital. She was nervous and ran the red light. She called in and explained that to the customer service rep who referred that that video to an officer. He reviewed it, he listened to what she said she was doing he dismissed that did not send the ticket out. So things like that come in quite often. And there's some police discretion applied to that again to the same standard that they would if they stop somebody on the street and had that interaction personally with somebody and they gave a reason why it might have happened. Also dismissals that reach the police department must be approved by a supervisor per our internal policy. So, some crash comparisons, it, it's always very difficult to determine, especially to quantify what has been prevented. So all we can really do is to assess the effectiveness of the program to enhance safety is to compare crash statistics. City wide and at red light intersections, and under the approaches where there are red light cameras before and after those went into effect. So overall crashes have tended to trend up in our city our traffic volume I think everybody would agree has gone up consistently year to year for the last many years. The other crashes that that are factored as red light violations are up across the city as well. The red light camera crashes red light camera intersection crashes are still relatively low and in fact they the while they are trending in a range up and down, up since 2014. And in fact, have trended down or stayed in a lower range than the rest of the trends across the city. These. The traffic at Lilliam Miller were turns off of the service road and turns from loop 288 that were not red light actually red light violations. So, as a traffic volume has increased throughout the city violations have either reduce reduced or decreased or stayed at the red light camera intersections chief question. So Councilmember Ryan. Thank you, Mayor chief I'm not sure if you can answer this or this is a pre temp question but do we know how many red light. How many signals we have signal intersections, we have within the city. We currently have 121 signalized intersections. Okay. That kind of helps on on this particular slide to try and figure out if it's which way it's really, really goes. And so, I think the data said we got 13 red light camera intersections. Out of the out of the 121. Correct. Okay. Thank you. More crash data, just to show the, the trends. So from 2006 when the first series of cameras were installed. The pre red light camera number there is the number of violations at those intersections, the year prior to those being installed so in that case in the first four locations it was for 2005. And you can see in some of those they. In the last four years. There's been none. Some there's been one or two. The same thing for 2011. You see the, the, the pre red light camera total for the year of 2010, and so forth. The same trend for the 2014 set. Question. Thank you. Thank you. Chief what one hears from critics is of a program is that while overall crashes, you know may look good, that it would increase rear ends. And is that is that trackable and tracked. We report all those crash statistics to text dot per 707. So, rear end collisions at red light camera approaches in the last four to five years have been zero. There's been zero caused by the changing of the red light. And so, there has been one very notable crash near a red light intersection on 380 at loop 288 may hill, where there were some people killed. But that in that particular crash, the traffic had stopped for several seconds at the red light. And so, the driver of the car that hit the back end of the other car was making a phone call on the cell phone and distracted. And so it had nothing to do with the red light changing to read, or the fact that there's a red light camera there. So, a little bit on the financial overview. Firstly, the funds are collected and and paid to the city, the red flex contract and other allowable operating expenses are deducted, and then there's a split down between the city and the state of Texas. The traffic safety fund expenditures can go into some detail that if you're interested, there's an approved budget every year that is part of the budget part of the Council of Budget approval that allows for those expenditures and for the expenses to maintain the program. And here's a breakdown from the inception of the program. Year to year with the gross revenues. The net that the city and the state were taken so back up a minute to the initial year, oh six and oh seven, which again was under the home rule. And that before the passage of transportation code 707, you see that there was in fact a net to the city and the state during that time. But, pursuant with the the red flex contract. In the next several years, there were no profit revenues generated, and that was all going to pay off the debt of the contract. That if there's not enough money to pay, or for there to be a net profit then this the, it's a net neutrality clause and so the city doesn't have to forward all the money for the contract and it can be forwarded to the next year and paid off so it took several years for the cameras to build up revenue before that, that contract debt was actually paid off. And it didn't start actually making money for the city until 1112. One of the council members asked for personal services to be outlined and expenditures. This slide illustrates the amounts for both of those. Since that point where the, the program started actually depositing money in the traffic safety fund customer brings has a question. The one part time staff person you mentioned earlier is that covered out of this. Yes, as well. Okay. Yes, and the cost of that positions about $21,000 a year. customer military has a question as well. Is the personal services. Well, maybe you've answered that by talking about the part time, but is this all over time, I guess the part time person is on straight time. Yes, it's straight time. The majority of the officer reviews and approvals are have all been done on overtime basis. And the, the reason for that is that we have tried very hard not to take away staff time from the street and from other duties. So it's been an internal policy that that was adopted many years ago to try to do that on an overtime basis and charge it back to the traffic safety fund. I'll add that there is nothing in 707, nothing in the city ordinance. On a time basis, a straight time basis, or paid for by the traffic safety fund. It can come out of the general fund. So, but we have tried to set that as a goal, not to charge back, not to charge anything to the general fund but the first several years it was impossible to do that. And then the next year after that even there's still going to be times when things have not been charged back to the general fund. I'm going to recognize you customer Gregory but we also have dinner ready, and it got here about 445 so if we're going to, if we're going to eat we probably need to take about a five or 10 minute break and eat. Too, too cold so I'm gonna let you ask your question and well, I appreciate that because it's a follow up to the question. I guess the question that I have regarding that was, are we at a point where we've done an examination of the idea of simply using some of those to add a full time equivalent to the police department as a patrol officer that would review these on regular time. But it would be possibly costing less money, would it cost less money if we had a officer or officers doing this during regular time. Is it possible that it would, we calculated that we would want a fairly experienced officer to to be doing this process or for the approval process, which would run about $121 to $122,000 base salary and benefits annually. That's before any other equipment and training costs. That, that one FTE probably would still have to engage in some overtime. If you took the part time position that our customer service position and converted that over to a full time staff member. You then would could would probably cover the entire program with two full time staff people with a reduction in overtime, but that would be about a $250,000 a year cost. So when you compare that to what has been the cost under the overtime, it's, it's not really a cost productive thing to do. And then, plus it at this point you have to consider to that to place those people in position at an experience level be taken away from the street, we hire somebody back, it's going to take us 10 months or more to get that person on the street as a rookie and train them through the academy. But I think I hear you saying is that it's probably more cost effective to to charge it to overtime. I would say that it is yes. Okay, thank you. All right. Do what is this real quick one. Oh, there's only one more slide. Okay, go ahead. Thank you. I couldn't find it in my backup. Oh, okay. Sorry. Sorry. All right, go ahead. I'm sorry, Chief. Yeah, just to cover one more thing the concerning the cost of the program. The, the, the amount that is paid direct flat red flex is a fixed cost per camera per month. $4,870 per camera per month, which translates to those figures that you see there . And of course we can calculate that out to the end the current ending time of the contract, and you can calculate that it's that that that those monthly figures to see what it would cost to pay off the contract and end it. So, I'll stop there and yeah we'll grab something we'll come back questions in the vehicle in that front vehicle that was stopped. I think that's important to know. I think it's important to note that if if if the programs making money, the programs not working, because we're trying to change people's habits, which would then net a $0 amount because no one's running red lights because their habits have changed. And then also in the backup, you'll notice that pre temp touched on the only significant factor that affects red light cameras violations or people preclude them from running red lights is a decrease in the temperature decrease in the speed before the intersection. I can't think of one intersection knowing that that's what they provided us, knowing that there's not one intersection that I can think of and didn't where we put a sign that decreases the speed. So we say hey if you decrease the speed for intersection it helps with red lights, but we don't have not one that I can know of that uses that technique, we're guaranteeing that it works but we don't do it. And that to me causes this whole program cause it in the question. So then you look at it all starts with mail notices so you get the they mail you the notice saying you 're ready you've run a red light we got the video go look at it. We have zero control over that that it all starts there, you have 35 days I think after you get that notice in the mail, but if you don't get that notice in the mail, if they have the wrong address if they have typo it's all out of our control. And they're saying hey the very trigger for everything is out of the city's control so a citizen doesn't get a notice . And then somehow they find out oh you missed a deadline now yours 100 bucks that you call the city of Denton they 're going to tell you, I can't talk to you because the time to raise that issue is expired. So then they direct you to the company in Oklahoma that says pounds and we sent it. And we all get that from from notices we send on zoning cases that don't cost 75 bucks that you can't track it. And so I have a problem at the very beginning with the notices. Moving forward, you got the you got the hearing that you can do so one me touch on early you don't get a jury trial. That absolutely is is is a red flag for me, because that's that that to me is an innate right when you 're anytime you go to court, you have a right, you should have a right to to be heard by your peers, if you choose to do so you have not to do so that's fine. Then you get to when you if you if you pull someone over for officer actually pull someone over, they don't have insurance, if they're if their cars not inspected, we're able to inspect we're able to take care of those things right now, then at that point versus someone without insurance just getting off with 75 bucks they'll take that every time because other than getting their car towed. So I think we're missing opportunities to get people that are violating the laws off the off the road by by having this system. And then so then you get to the hearing the actual hearing. If you if you've not been there. You're required to produce engineering study hundred foot notification of intersection publishing new requirements and proof of mailing. Well, my, my problem with this is so turnkey they blow past all those requirements, the people are going to be there based on staff's information as a police officer who's not going to be able to test any of that he's going to assume all that to be true. And my problem with that is, right here in that section in the state law 707.013 presumption, it is presumed that the owner of the motor vehicle committed the violation alleged in the notice of the violation mail. That's absolutely egregious. You're presumed guilty and you 're the owner of the vehicle and then you got to roll over on someone to get to get it from under you. It's just absolutely lunacy. And if we're saying it takes the place of officer and officer situation again based on information I get from staff and the officer. There's a driver to get the ticket officers therefore red light camera driver gets a ticket this automated system will just mail it to anybody you know so it just it's flawed from top to bottom that we charge the max on everything 75 bucks is the max and 25 bucks is the max again no control over any of this is all you know so. And then I'll end with this. Your defense of this alleged violation. You can say that you rented at least a vehicle and make a statement to that effect and be done with it. No one's going to fact check that no one's going to look into it because again we're just it's a profit maker. And, and you're required by this statute to prevent prevent present evidence that you're not guilty, which is absolutely reverse from everything to do with the legal system, everything. And so for me, we're violating people's rights. It's not successful because we're not changing people's habits. And, and we're not being the very trigger is out of our control, the mailing of the of the note so if someone comes to me and says, hey, we're going to bring it in house to some degree, we're going to lessen the fees to some degree, and we're going to have more control over it, then, then I'm all ears, but as long as we're going to, we're going to have the this. And the whole hearing piece has got to get fixed I mean, there's no other situation in any court, criminally, or not that you're presumed guilty. And that's just absolutely crazy to me. You shouldn't have to play police officer and say hey here here let me do your job for you let me, let me find out who rightfully belongs to this ticket or let me prove up that I at least the car, so I just, there's no pattern for this there's no. It's so rogue, and having gone through it and you lose a half a day with the initial hearing, if that doesn't go your way you're going to lose another half day with the another hearing and all for what I mean that's someone that does that, like me is just, you're just a button for punishment because you don't have to, you don 't have to pay it. You know that's the end result, there's no punitive measure to it. And so for me it's just we're spinning our wheels, I'd rather just write a check for $6, 000 out of the budget, $600,000 and be done with this thing when when when that time comes. And I spoke at same position in 2014 that it's this whoever was sitting here 2014 voted to extend it, I came and spoke before that Council before and so I've been consistent in that if you don't add those features if you don't take that that that someone, the mailing piece is key that starts at all, and we have no control over it, but we'll take your money. I know we've seen in some of the backup that if let's say for instance, I'm not advocating for this or not for for against, but if is there a penalty like the contract exp ires next year in July, am I correct. If there was a termination of that contract prior to that time. Is there a penalty. And if so, what is the amount of that. The full amount of the contract would still be owed month to month through July the 19th. So the, if the council decided to terminate the contract beginning next month it's around $800,000 and you could subtract $63,310 something that effect every month from there. And tell you how much we'll be okay. Okay. More discussion. Oh, Councilmember breaks. Does that that contract is it on an automatic renewal or does it have to come back. It's optional. Okay, I'm going to step out would you take the chair, I was told I have to do that. And are we making the decision, are we making the decision today, like are we looking for direction on the renewal of that contract or not at this moment. You can certainly provide that kind of direction to us. Just so the council knows we're not taking a position on whether to close it or not but we did leave, I think roughly about a million dollars in that fund last year just in case the council ever decided they wanted to do that. So you get the money in there, or you can let it run out and defend. It's up to you in the caption says, receive a report hold a discussion and give staff direction. So, what that I was told I had to, you know, so, so, so we're, we're involved in, we can give staff direction. Yes. So I'm not in favor of renewing the contract, but you said there's the million dollars in there so I would be more in favor of just letting it right out, and us being able to use that million that's in there for traffic safety fund expenditures. And for more crosswalks and things like that that we need to install. Well, I will argue against Councilman hospice that there's not anything else because I recently received a bill in the mail from NTA, and I wasn't driving the vehicle. But I called the dealership where I had dropped it off for service. And they went ahead and paid. So you can get someone else to pay when you aren't driving that is, that's not that big of a problem if you're operating your vehicle properly you know when it is and who's driving at the time. I'd like to see a little more steady on the adding the second. I think that this is that should not be about revenue, and it's become about revenue we are maybe a little above where we should be in the, in the number of tickets that were able to fund other things this way. I do see it as a safety issue there's some intersections I question and not have to go through one by one as to whether they're that much more beneficial under 35. I can definitely see, especially from a policing standpoint where that would be very safety very much a safety issue to try and police those areas and and stop the violators. But I will make this one comment while the data fascinated me that we had that big of a reduction. My question about when that was restriped tells me that we may have had several fast roll through reds that went through there in the prior year. Now you've only got two lanes in there that I don't know how much of an impact that had on it probably, probably not a whole lot but I'd like for us to test this on all except for the 288 Lillian Miller lights, because of the current traffic backup that are that's there I don't know if we're going to get any additional, but I'd like to see a little bit longer steady of adding that second to all of these. As far as renewal I don't know that we're even going to have that option because I've heard of several representatives that were carrying a bill forward. There was one that was nearly passed in the last legislature that would just do away with red lights to begin with. And that's a discussion for next for next April or so is probably about the time it would come back before us. I think there's a clarification on the testing, I agree with you and I think that's what Councilmember Melzer was trying to get to is hey, are we going to test this out these hypothesis. I'm not sure. I'd like to hear the impact of doing it on all the cameras but one. You're adding a second to all of them but the one at Lill ian Miller. I mean, is there is there a subset that we could because what I'm hearing is maybe an extended more, a longer extended amount of time for testing to see if this behavioral trigger eventually comes in and I don't know what the recommendation or the proposal would be from staff on that, but I'd like to hear if you're talking about adding a second to everyone where there's a red light camera is that is it easy, it's easy. Congestion or do we want to do it on fewer number that's that's going in one other one that I would have to question would be the Mayhill and University, because it's probably already at its maximum of are pretty close to it I think the maximum that the manual suggests is six seconds and it 's probably almost up there. So, picking up the intersections I would want to show that a lot of these are under constructions if you look at May hill and Spencer. It's under currently under construction. Anything on the loop as you mentioned, Lillian Miller is also under construction University and may help there. It's a mayhem project again here. And there are very few locations if you look at University and 35. It's already congested there so adding more seconds will add to the condition, Shady Oaks Woodrow we know it's all backed up, especially peak hours. So, there are all of these intersections going back to what Mr Mayor said that I think if we can test from the staff perspective, one location and track it will will be able to track the data better and do a better job, instead of adding unknown uncertain needs that go with construction and other issues, and I would say if it's only one intersection make sure it's one that hasn't undergone the Shady Oaks and Woodrow we added the right turn lane so that 's going to be a different result. Correct. This one we had restriping and a change of number of lanes in September so it's got to be an intersection that the other situation around that intersection has not changed from last year. In order to result in better data. Okay, if that makes sense. Thank you. Well, I've listened to all of the arguments read all of the emails listen to people over the years. So they say that one of the reasons we shouldn't have them is because it causes more rear end collisions, but the data says that's not the case. We hear that it's unconstitutional, but that hasn't been settled in the courts yet. We shouldn't do it because we're not using a local vendor, but there are no local vendors offering the service. We shouldn't use it because fines generated income for the city. Well, every fine that we issue generate some income for the city. So I guess the argument is no fines. I've heard arguments that it's against it violates privacy rights, as if there's a presumption that when you're on a public right away that you have privacy, you don't, you don 't have privacy rights. The police don't have to have a warrant to set out on the street and watch people speed or not speed. I've heard it argued that we shouldn't do it because it's selective enforcement. Every enforcement that you do is selective. When the police officer decides to set up a set for checking radar for speed, they're choosing a particular time and a particular place to do it. It's all selective enforcement, but the selective enforcement for where we put these cameras is based on data . These are the intersections where there are the most accidents. These are the intersections where there are the most violations. It doesn't pick on one part of town over the other. It's just focusing on intersections based on data. Had an argument that it's bad PR for the city. Yeah, because when people get a ticket, they don't like it. Just like when people, you know, their restaurant owners who don't like low scores on their health inspections, bad PR for the city. When people get a notice of property maintenance code violation, it's bad PR for the city. You know, it seems to me that what we ought to be doing is remembering what we're here for. And according to our charter and according to the Texas local government code, cities are here to protect the health and safety and the general welfare of the city. So we just ask that question. Do red light cameras add to the health, safety or general welfare of the city? Well, the data, the empirical data says that red light cameras reduce violations and reduce accidents. The data says that. We get magazine every month from governing and the May 2018 issue has an article on it. And it says a lot of this. The real question is, do traffic cameras actually save lives? And are they are are they just thinly disguised revenue schemes? A fair amount of evidence exists on this point. If the combatants are in the mood to listen and it goes on to say most of the statistics on these cameras come from the Insurance Institute for Highway Safety, which doesn't disguise its support for camera enforcement, but doesn't seem to have an incentive other than saving money for its members by cutting down on accidents. If the cameras didn't make driving safer, the IHS would have every reason to say so. What it says is the opposite. As of 2016, the IHS was reporting that in some years, red light running has caused nearly 800 fatalities nationally. Most of these people killed. This is interesting, were pedestrians or passengers, not the scuffle drivers. Cameras had reduced the number of fatal crashes and photographed intersections by 21 percent. That's data. National data. And it's not over one year or one month period. It says turning the cameras off have caused the number of fatal crashes to spike by 30 percent. That's the data. So, you know, we had data in our backup. On page three, it said a 2008 International Institute of Highway Safety study, they don't have a dog in a hut. They're just trying to find safe ways for our roads to be operated. It demonstrated that a 36 percent reduction in violations occurred when one second of yellow time was added to intersections. That's good news. But the same study also indicated that the inclusion of red light cameras to these intersections reduced violations by an additional 96 percent. It's just data. It's just data. So I think, you know, the reason I'm for it, and I don't I 'm not going to get to vote on it, is because this is the only area where we have consistent enforcement. We had a discussion back in February on the ethics ordinance. One of our members said we must enforce 100 percent the rules 100 percent of the time, or there's no point in having the rule. Guess what? Guess where we only enforce rules about traffic laws 100 percent of the time at those intersections. It's the only place. It's an efficient way of enforcing our rules. It makes our streets safer. There's empirical data to back it up. And our job is to provide for the health and safety and the general welfare. So if you do away with the cameras and when the accident rates go up, if you do that, if you all do that, just promise me that you're going to do a come back in a couple of years and see what's happened. And if the accident rates go up, you'll know who's responsible. Okay. Anything else? It sounds like what -- oh, I'm sorry. Didn't see you. Yeah. Part of the issues that you hear come from the fact that the enforcement and the remedies are different versus if a police officer were to pull you over. And we've heard that the state doesn't require you to have the right -- or the state doesn't give you the right to a jury trial. The state doesn't give you relief if you say it wasn't me. They consider you liable. But are we -- is it possible for us as a municipality to extend those rights and those remedies even though they're not required to be extended? I guess that's a question for the city attorney. Nothing prevents the city from actually granting those rights. It would be beyond what Texas Supreme Court and various courts of appeal precedent has been set for. Basically they've said that in administrative type proceedings, you're not entitled to a jury trial like you would in a criminal proceeding. That's just the general rule. Nothing prohibits this council from going above and beyond if they wish to do so. So I asked that question obviously to the point of saying that it may be possible to have this program without the deficiencies that have been pointed out. Now, there's one more that hasn't been brought up. And I've spoken to a number of people who are critics of the program just to see what are the issues. And I'm kind of ticking them off as you have, Councilmember Craig. Another one that's been raised is that it's a corrupt company whose CEO is in jail. Might as well put it on the table. Now, if that's true, raises the question whether we ought to be doing business with such a company. Can you take your business across the street? Are there competitors? I don't even know who I'm asking. Chief? Are there others? I mean, that's a good question, but right now we're in a contract. So then that would be we terminate the contract and then we 'd have to decide to do something else in that regard. So the decision point happens then. From my understanding, the people that were entangled in some issues a few years ago are no longer with the company. So that's really about the only way I can answer that question. I'm not aware of any other -- I know there are other federal enforcement systems out there, but I'm not aware of how well they would compare with Red Flex. Okay. But that's something we could conceivably find out if we were so motivated to see whether there are alternatives. And I wonder if any of those alternatives might also provide us the ability to control the mailing process. I just don't know that the objections that people raise are insurmountable. Councilman Bates? So at the end of the contract -- so the contract goes away, but the cameras are ours, right? We in the process have purchased those with all the money that we've given them? No, I don't believe so. I think the equipment would -- it still belongs to Red Flex , so they would probably come take it all out. So it's just like we've just been renting it this whole time? That's my understanding. Okay. Anything else? So the only direction that I've heard is, number one, get out. That's what I think I heard from you, Councilmember Husserl . No, sir. Fix it. Like, would Councilmember Messer -- it's -- yeah, if you fixed it, I'm fine with it. If fixed, we take over more control. Okay. Yeah. All right. But as far as the way it's proceeding now, out, unless you can fix it? Yes, sir. Yes, okay. And that would cost -- if we're not able to fix it, which we -- I don't think in all these discussions we've identified options of other companies who could come in and do it without that penalty, or us take it over. I mean, that's what you're saying is then -- I don't think we've ever had any data or costs on that. So that's something I guess staff could look into. Well, if I may? Sure. No, no. I've had the 2019 in my mind for a very long time. I can't wait. But, yeah, I'm okay with 2019. Okay. I mean, I'm not saying fast-track it. Okay. It's doomed in 2019, in my humble opinion, if I'm here. Okay. But that's what I'm just trying to -- that's what I'm trying to determine is, doesn't sound like there's a consensus to say we're going to breach the contract or terminate the contract right now. Everybody's saying we've got a year and, what, one month left, two months left? And I don't know what the renewal -- what notice has to be given ahead of time. Do you know on the contract what notice there is, or is it just terminate at 19 and that's it? Without an option to renew? July 2019, if it's not renewed or extended, it terminates. Okay. So it does it on its own face. All right. And then I've heard to look at, is there the opportunity for jury trials or things such as that? Personally, if we're going to do that, I would like to look at that after 2019. I mean, there's a big difference between a criminal process and not even a civil court process because this has been described as an administrative hearing type of scenario and context. So there's a big difference there. I mean, I'm okay with letting it run until 2019, and we can have these policy discussions to get ready for that. I certainly would agree with the testing of the yellow light intervals because notwithstanding what happens in 2019, that might be something we want to look at to see if there's a way to help this organically. And then if somehow we get rid of them and we're seeing crashes go up at red light intersections, then we can make the decision to increase the budget for the police department, hire more officers. And if that's how we need to do it, because public safety is the number one issue. And how do we do that the most effectively, the most efficiently, taking into consideration all the interests of the stakeholders? Not just those who are adamantly against it for a myriad of reasons, not those who are totally for it for a myriad of reasons, but how do we balance that? I think it's fortunate that we have a short fuse left, and that'll give us some time to look at it. But so is that that direction is what I'm hearing. We sort of let this roll to the 2019 and begin to formulate some options and look at some things rolling up towards that time to compare to this. And also increase the interval on selected intersections to give it more of a long term test on driver behavior and to acquire more data. Is that have I missed something? Yes. I think there is just one more. It's not strictly speaking well it is pertinent to this but it's just the point that Councilmember Hutz with raised. I'd like to ask staff if if it is true that reduced speed, you know, you have reduced speed limits in advance of the intersection reduces violations and is it true that we don 't do that and could we or should we evaluate that? Couple things. Let me start with how the speed limits are established. They're established on a corridor level. It's a high level. Look at it. We don't necessarily break it down at each intersection segment. So if if a street segment is picked, it picked it's picked for at least a mile or a couple miles, depending on the size of the street. And once it's picked, we go through a speed survey engineering study all those different things to set a speed limit. So it becomes an issue if you have enforcement issue if you have different speed limits as you approach different intersections. So the way it was presented in the AIS was it was just trying to list what are the things that actually impact the red light violations. So research indicated that red light violations go down if the 85th percentile speed is reduced or if they're heavy vehicles or if there is decrease in traffic volume. So it was just listing the factors that contribute towards a reduction in violations, not necessarily a technique to do those. Yeah, I mean, what you think could be very difficult and I think it would create more accidents if you're driving down the road at 40 miles an hour. And after a certain point, as you come to a red light, your speed limit goes down to 30. I just think that would be very, very difficult. Number one, to enforce, I think you'd create more accidents and congestion would mean. I mean, so I understand what you're saying. I understand what you're saying. What you're saying is, hey, let's make sure that our policies are consistent with the data and how we can enforce that and how we can reduce them. If there's data out there that we can reduce them. But I guess that would seem that would seem difficult to do. But hey, we've done some difficult things. Any other questions on this? All right. Fantastic. Then we will adjourn this particular work session item and together with that we will move into I will convene the closed session at 610. We will consider the following items consultation with attorneys under Texas Comprehensive Code section 551.071. Deliberations. I have no idea what this is. What's this? Okay. Deliberations concerning economic incentives under Texas Government Code section 551.087. So it's the right. It's just a it's a. Meeting of the Denton City Council on May the 22nd, 2018. It is 635. If you would stand with me if you're able to pledge allegiance to the US and Texas flag. I pledge allegiance to the flag of the United States of America and to the republic for which it stands, one nation under God, indivisible, with liberty and justice for all. I pledge allegiance to the United States of America and to the republic for which it stands, one nation under God, ind ivisible, with liberty and justice for all. Okay. Okay, this is a proclamation for the Denton citizen Fore ster trainees. So all who've done that come on down. Going to give you a chance to introduce yourself and Julie tell us a little bit about this program. How are you? Good to see you again. All right. Now y'all step out here you don't need to hide behind the podium. Okay, tell us a little bit about the class or the. Great. Okay, so this is our citizen Forester class of 2018. This is a class where we teach just regular old Denton citizens to how to be urban Foresters. This is a partnership that we've done to keep them beautiful with the city of Denton as part of the Denton tree initiative. So these students take six classes starting in January runs for a couple months. Six classes where they learn about treated tree identification, tree pruning, tree planting, tree species. Basically, they are experts on trees. They can help you with anything you want to know. They have to do volunteer hours and then there's really great people, really great class. We also partnered with the Cross Timbers Urban Forestry Council to put on this program. And it's been going for the past three years as part of the Denton tree initiative. And we've had about 65 graduates over those three years. Well, I want you to introduce yourselves, but also going to put you on the spot. So I'm going to give you about five seconds to think of your answer. I want you to if you if you have it to just share the most interesting thing that you learned or just something you did just what what is it that when you think of the class and your time, what really pops out at your experience? My name. My name is Ali Silva. I'm actually the board president for Keep Denton Beautiful as well. And the most interesting thing is that I can now identify trees. I'm actually Celia Spolatro. I'm a staff member at Keep Denton Beautiful. But I was president for all of the classes. So I definitely my favorite part was learning about different parts of the leaves and how to identify trees using just the leaves. My name is Aaron Piper. And I think the way that trees take up nutrients. My name is Rita Loki. And I think the most amazing thing is changing my mindset to realize that this tree is a living organism. It's not just shade or just something to put a swing on. And it also amazes me that despite everything we do to them , they survive for the most part. My name is Jim Loki. The thing I found the most interesting . We have a lot of postdocs in our yard. And what I found was everything I've done with them is wrong. So trying to go back and fix that. I'm Josh Mullen. I really enjoyed learning how to identify the trees and the science. But the most interesting thing I found was to call the state to ask any questions. Thank you. All right. This is a proclamation by the mayor. Whereas the Denton citizen forest training is a volunteer training program offered through a partnership between the Cross Timbers Urban Forestry Council, Keep Denton Beautiful , and the City of Denton. And whereas the citizen forest training program was first introduced in Fort Worth, Texas in 2006. And whereas the program is now offered in Denton with funding from the city's Tree Mitigation Fund as part of the Denton Tree Initiative, an ambitious campaign to engage denton residents, businesses and neighborhoods in tree planting and care. Whereas today's citizen forester graduates have completed 36 training hours in advanced tree biology, planting and care through hands on field activities and classroom instruction delivered by top urban forest professionals. And we do we. Okay, we're going to we're going to get them to introduce themselves to whereas citizen foresters are thoroughly trained to assist with a variety of tree related activities, including educational workshops, tree plantings and tree giveaway programs, making them a true asset for our community. Now therefore I Chris Watts mayor of the city of Denton, Texas to hereby recognize the spring 2018 graduating class of Denton citizen forester trainees and applaud their commitment to Denton's urban forest and all the benefits it brings to our community. Let's give them a big warm applause. I'm Courtney Blevins and I'm just the regional forester for the state as mentioned down here and I'm easily recognizable what we call a pickle suit here but I do want to say of all the keep Texas beautiful affiliates I've worked with in my 30 something years. None are better than keep getting beautiful I mean you all are so tree proactive you know a lot of a lot of the keep Texas beautiful affiliates are interested in planting pans ies or something like that and I know you'll do that too but you all do a great job and I appreciate it. Thank you. Thank you very much. Appreciate it. Building Safety Month. Who's here for building Safety Month anybody. Oh, well, well, that was sort of a delayed reaction. Come on down and who's going to be the spokesperson. Oh, Scott. Okay, well, all right, I guess. So, no, introduce yourself and tell us what we're proclaim ing today. Hi, I'm Scott McDonald I'm the building official for the city of Denton, and the director of development services. What we have here is a partial crew of building safety. What building safety does for the city of Denton and its citizens is is largely unseen. What we don't have is our field inspection staff so this is an incredibly difficult week for them. We have the building professionals Institute which is one of the largest training programs in the state so our inspectors are in classes plus trying to keep up with the huge numbers that we're seeing this year which were were probably. More than double what we were this same period last year, so they're working extra hours and getting trained and doing great things to protect our citizens. So, these are. This is half of what our staff is, and there are first preventers, so you know, you know those folks that are your first responders, these folks help you. So you can take for granted where it is you live work play and worship, just to make our city a better place to live so pass off to them and I very much appreciate the work that they do it's it's unseen it's tireless and, and just want to recognize them. Go down the line introduce yourself. Well I'm Janelle Montgomery and I'm a commercial plans exam iner, I've been in the city for about 12 years, and I really enjoy the making sure everything safe for the city. I'm Carrie Frazier I'm also a plans examiner for the city. Amber Rogers, I'm also a commercial planes examiner and I have been here just shy of 11 years. Emily Lohsel and this isn't building official I've been with the city 13 years. Really appreciate this team. They work really hard to make the city safe. Angela Adams I'm a residential plans examiner been with the city a little over three years. My name is Billy you, I'm the buildings, building inspection supervisor, and I've been here 15 years. I really love my job, see it didn't is a great place to work. The people I work with are exceptional. And it wasn't until I become an inspector that I realized just how important inspectors job was, because, like has been said by Scott is that is the everything that happens before you occupy the building that make sure that you're safe. There's a lot of little things that people don't realize that keeps us all sleeping well at night. I'm Andy Whitaker and I'm a permit technician I've been with the city, almost two years. Michelle Brown, I'm a plans examiner. I've been here next month, three years. This time, I was here five years, about 12 years ago actually so apparently I liked it enough that I came back to the exact same department and doing what I did before. My name is Glenda Gaylord, I'm the permanent technician supervisor, I will be with will have been with the city 16 years next month, and I enjoy working for the city I enjoy the people that I work with, I enjoy the collaboration that I have with the departments. It's just an awesome place to be. So thank you. I'm Josh Hamlin I'm a permanent technician, been with the city, just under two years, and the thing I enjoy the most is getting to work hand in hand with my fellow citizens of the city and help them understand the code and help them apply properly for their permits. For someone who's built in this city. You all are very important, because if we don't get it right in this process at the beginning stages, then we have to correct it in the field, which is much more expensive so thank you all for your work and your dedication your commitment to making sure that the buildings that we permit and the buildings that we live in and the schools and the places of worship are safe. And we also educate the public on that so thank you all very much you do a wonderful job. This is a proclamation by the mayor of the city of Denton, whereas the buildings we live learn work worship play and go to school, each day, are among the safest in the world. I'm going to read that again because I think that's important I think we take that for granted. The buildings where we live, learn work, worship play and go to school, each day, are among the safest in the world continuing efforts to address the critical issues of safety in the bill times of natural disaster, protected by the implementation of the codes. And whereas our confidence is achieved through the devotion of vigilant guardians building safety and fire prevention officials and others in the construction industry who work construction of buildings. And whereas these dedicated members of our community recognize the importance of thoughtfully written building standards to codes to protect our citizens, whereas building safety month is dedicated to remind the public about the critical role of our citizens. And whereas the largely unknown guardians of public safety, our local code officials who assure us of safe, efficient, and livable buildings. And whereas building code saves lives. The theme for building safety month 2018 encourages awareness and promotes actions everyone can take to ensure that the places where we live, learn work, worship, and play are safe and recognizes that building safety month lives have been saved due to the implementation of safety codes. Now therefore I Chris Watts mayor of the city of Denton Texas to hereby declare and proclaim this month the May of May 2018 as building safety month and encourage citizens to participate in building safety month activities and thank you all so much for what you do for our community. Thank you all so much. We could roll the review of procedures for addressing the city council please. The city council has adopted rules of procedure including a code of conduct that applies to citizens, as well as council members. These rules were enacted to promote an orderly process and to preserve decorum. Here is a brief review of the rules that apply to citizen reports. Citizens will have four minutes to time has expired. If the remarks are not concluded by that time, the citizen will be asked to stop speaking. If the citizen does not cease and a second request is made, the mayor will request to have the citizen removed from the council chamber. Citizens are asked not to approach the da is. If a citizen has papers or other materials to hand out to the council, please let the city secretary know in advance. For scheduled citizen reports, the council may initiate discussion or questions. For non-scheduled open mic citizen reports, the council may listen to citizens speak. However, because no notice of the subject of the open mic report has been provided, the open meetings act limits any deliber ation or decision by the council to. A proposal to place the item on a future agenda, a statement of factual policy or a recitation of existing policy. Citizens are asked to direct all remarks and questions to the council as a whole and not to any individual member. Please refrain from making abusive personal impertinent profane or slanderous remarks. Anyone who violates this immediately removed from the council chamber. Thank you in advance copies of the rules of procedure are available from the city secretary. Okay, agenda item three B is received scheduled citizen reports from members of the public ahead of time for agenda item three B. So we then move on to open mic three C, which is limited to two speakers, four minutes each. Our first speaker will be Suzanne Townsend. He'll come down. Hello, my name is Suzanne Townsend I live at 425 Hedy Street, and I would like to request Mayor Watts to read the bike month proclamation. And so any cyclists who are here for bike month pro clamation, come and join me up here. We have some ladies from the Tuesday night social ride that have dropped by before they continue their ride for the night. Okay, so I'm, my name is Chris Watts I reside at 2216 South Pony Brakes. Okay. More than a century the bicycle has been a util itarian economical, environmentally sound and effective means of personal transportation recreation and fitness. Sorry. And whereas the city of Denton Texas encourages the use of bicycles as a means of transportation, and is recognizes people on bikes as a legitimate roadway user, and therefore are entitled to legal and facilities in Dent on, except highways constructed by state standards. And whereas the city of Denton Texaco benefiting all citizens of Denton by improving air quality, reducing traffic congestion and noise and decreasing the use of dependence the use of bicycles as a viable mode of transportation endeavors to promote safe and responsible bicyclists and motorists as to the proper and safe operation of bicycles is important to ensure the safety and comfort. And whereas the League of American Bicycle, local bike shops and independent cyclists throughout our community are promoting greater public awareness of bicycle operates, injuries, and fatalities. Now therefore I Chris Watts mayor the city of Denton, Texas do hereby declare and proclaim the month of May 2018 as Bike Month citizens to ride their bicycles to work to the store to the park around the neighborhoods and with friends and family to promote the personal and societal benefits achieved from bicycling. Thank you very much. I want you to introduce yourself to. You'll know me already but Suzanne Townsend. I've been biking around Denton for about 13 years now it's been a while. My name is Garrett room or and lived in Denton for about 20 years now, and I've just been amazed at all the infrastructure improvements and really appreciate being able to ride my bicycle as opposed to always have to take my car somewhere. Thank you. I'm Sally Austin and I'm going to read my letter to the editor about biking and dent and so I'll tell you all about it but I always say move here twice. binds, and I'm a bike commuter. I am also a bike commuter. Wendy McQuade, I guess I would call myself a recreational bicyclist came from Albuquerque, which is another bike friendly town, about five or six years ago so I'm enjoying all the new infrastructure that denton is putting in. My name is Lindsay Baker lived here for 33 years and I just started writing bikes about six months ago and it's been awesome and I really appreciate all the infrastructure that 's that we have nowadays for that. Cyclist also and a former 26 miles round trip. Unfortunately I wasn't doing that here and didn't because I was actually the trans. I'm concerned about developing infrastructure and providing better safer cycling for the cyclists that you don't always see in spandex, but the people that are going to their construction jobs, going to their jobs at the red it is a primary mode of means for transportation. Thank you all and here's your proclamation. Thank you very much. Y'all be safe out there. Care next open mic participant is downstate your name and address your time will begin. Hi I'm Sally Austin 11912 Emory Street and I want to read you all my letter to the editor about biking and then I'd like to thank the people of the 93% of who have been kind cordial and helpful to me as I bicycle my way through the city. I've really had such positive experiences actually sold my vehicle last year and use my bicycle is transportation exclusively. I don't the vehicle for 37 years previously. Years ago I paid for today class to improve my cycling skills and it really helped a lot. I use hand signals communicate with vehicles to make intentions known. And I wave to thank you for not hitting me each time I safely navigate an intersection and traffic. I really appreciate it. I do claim my lane and act like a car when that's necessary . I wear a rear view mirror on my helmet and when I can I give you the right away because I don't like having you behind me any more than you like being behind me. It's a city continues to add bike lanes and sidewalks other people might consider biking is their only form of transportation to that means less traffic congestion for drivers cleaner air and a healthier community. We've really got a great community, our goals drivers inside goes aren't mutually exclusive. In addition, protected bike lanes and sidewalks also provide safe navigation for people with disabilities and pedestrians as well as cyclists to maintain their greatest level of independence safely. This adds to the overall health of our community. There's currently several roads I won't ride my bicycle on it all if not possible for safety reasons Dallas Drive Sherman Drive Fort Worth and McKinney Street and certain sections. I see pedestrians and people in wheelchairs trying to navigate them and also in various precarious situations. I mean many many people former cyclists that were hit by cars no longer ride only for that reason. I think we'll have more people riding bikes, the more we add connecting protected bike lanes and fewer cars on the road. I'm looking forward to see how we continue to grow together considering and communicating both our needs, as well as others to assure a safe and healthy community for everyone. See you on the streets and thank you again for being so considerate. Thank you. Thank you. Thank you all. Our next agenda item is consent agenda. Councilmember Gregory, I move approval of all the items except item I that we're pulling for individual consideration. All right. And I believe. No, yeah, you can vote here and then once we call the item for individual consideration. Yes, sir. All right. So we have a council member Ryan. I'll second. All right. So we have a motion and a second for approval of the consent agenda except for agenda item I which will consider under items for individual consideration. Let's vote on the board, please. Motion passes six zero and I believe the councilman council member Metzler you're going to recuse yourself on agenda item I yes, and he's filed all the paperwork and okay. All right. Yes, he has. Okay. All right. Okay, so we'll now take up agenda item I do I don't believe we have a staff presentation on that. Don't think one was requested. Councilmember Gregory, move approval of item I council member Hudson. Second, we have a motion and second for agenda item I let's vote on the board, please. Motion carries five to, I guess, five. Five zero. All right. We'll move on somebody. Councilmember Metzler can Meltzer can come on back. Thank you, sir. Agenda item five which are items for individual consideration agenda item five days consider adoption of an ordinance of the city of Texas amending the fiscal year 2000 2000 I'm sorry, 2017 and 2018 budget. Mayor city council Tony pointed director of finance. Can we briefly talked about this and we talked about this during the work session. This item would amend the city's electric fund to utilize $24 million to fund our capital improvement program for 1718. In addition, we do $10 million of excess utility system revenue bonds from our program, total of 34 is a reduction in the planned issuance of in the adopted 1718 budget utilizing this money. Instead, we would not issue the hundred and 74,000 send the city's solid waste fund to pay back the electric fund for some property that was purchased, and can counsel had numerous discussions about that particular substation that will no longer be put on this includes my presentation, be happy to answer any questions if the. Blue cards turned in the councilmember has with move approval. Councilmember breaks. Second. Motion carries 605 be which is considered option ordinance considering all matters incident and related and certificates of obligation. Mayor city council, I do have a short present, if you'd like, but just briefly, this particular item sets a maximum amount that the city would would issue 10 million, 110,000 dollars. This is a parameters ordinance and the staff would hit to complete this sale. I will tell you that we had originally planned to issue these bonds on the 24th we've tentatively proposed to postpone the sale until a later time as we continue to go through the budget and look at some of them. But again, this ordinance would establish the maximum that the city might that will be able to issue for CEOs. The 1718 proposed budget, I included 95 electric water wastewater and saw several months. Staff has done a lot of work in the area of is simply to fund capital improvement programs with CEOs in general government. If any of those would be issued for any of the other utilities. Do you have a just a slide that just shows, do you have a specific list of what items are included in that 10 million and someone presentation, just an itemized list or is it just fund with a 9.9 million. I will tell you that we are currently looking at. And so as we continue to go cast. There might be opportunities to not issue some of these see it to postpone the sale as we continue to evaluate that forecast. But these are the projects. There's a number of staff members here that can speak to any of these particular projects if you says 10 million 110,000. And this is 9935. There's a delta there. Correct. That's for cost issuance. Yes. Appreciate would appreciate some kind of perspective on us to look at 90% of, you know, what was originally approved what assumptions have changed that's, I'm sure that there were persuasive presentations, originally supporting these projects so what's changed. Again, as we continue to evaluate many of the operations, you know, we've been able to pull back on some of these projects defer them until later date. It's really more of a timing issue than anything. Council member we did talk to you specifically about the projects at DME decks to a future date that do with transmission services and so it's kind of really been kind of across the board just a reevaluation of what we're thinking and a different lens at all these. I guess I'll just add to really teaching the man cash flow needs. And what I mean by that is the ability to deliver projects. There's them out the door and all that has a very different expectation on revenue. So, we're taking costs out of the utilities we're doing business a little bit with all the utilities it's much more of a quite frankly a monthly use and whether projects are getting out the door. And so, through these cases we've been able to put a little bit stronger lens on things and avoid the debt issues by managing the projects more closely. Councilmember breaks. So, right now I just wanted to go there as an item, and I usually recuse my, I wanted to say that since this one, this money is going specifically moved earlier. I don't have to recuse myself so just in that. Great. Thank you for that transparency. Thank you. Any other questions for staff. Right, customer Brian. Thank you, Mayor, I'll move approval . Councilmember Hudson, second, we have a motion and a second for agenda items agenda items excuse me five be a spot on the board please. Motion carries five zero agenda item five see considered option of ordinance considering all matters incident and related to the issuance sale and delivery of up to 19,750, 000 in principle amount of city of Denton general obligation bonds series. Mayor again Tony point to what you have up here is the list of the projects that we are proposing to fund with the 2014 bond election that many discussions with both the 2014 bond oversight committee audit finance committee and also the city council. The only difference between what we had originally proposed from what we have up here in the list of projects is that we did remove $4.9 million associated with the redel real ignment project on that will have ongoing this committee council on that particular bond issuance, but we're recommending 19.75 million to fund these particular projects. Okay. Any questions for staff. Councilmember Meltzer. Let me see if some of the city engineer tackle that one. There are multiple options that we are looking for in the alignment of Bonnie Bray as it impacts McKenna Park, and the properties that are surrounding at the standpoint, both from a just purely transportation and the vehicle, vehicle or sense but also in the pedestrian and bicycle sense how that plays with the overall neighborhood pack the overall budget but that's what we're currently evaluating right now is what those options are, and then we'd bring them back to you at a later date so you can evaluate that yourself. You know in this list. If part of that discussion that we would have is are there elements that we need to pull back is there some ways that we scale that back with I mean as we can with the budget we have to explore how this connects to the pedestrian and bicycle facilities, and then we can figure out how best to make that happen. Does that affect what you're doing, knowing that that's not resolved. Sure, I think continue to to fund this project in this matter for now, I think as we continue to evaluate that project, understand what the delta is, then we can come back to the council with some, some options on how we can bridge that gap, whether it's additional debt, we would not we could potentially issue CEOs or cash fund this project or again leverage some external sources, so we would have to evaluate that once that you know that differential cost is known if there's one. Okay, Councilmember Ryan. Thank you, Mayor, I move. I'll second. We have a motion a second for agenda item five see let's vote on the board please. Okay, so the public carries six zero agenda item six a hold a public hearing and vision that didn't development code, specifically to update parking requirements and September 14, the parking standards. We had an open the public hearing prior to staff presentation so I don't forget to do that. I'm Richard can only development services department, wanted to go over a pre residential parking standards. If you recall, the started back in January 9, we had presented a some some discussion items with respect to some of the ideas we had in addressing the issues. 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and we had a discussion on the parking standards, and we had a discussion on the parking standards, and we had a discussion on the parking standards, and we had a discussion on the parking standards, and we had a discussion on the parking standards, and we had a discussion on the parking standards, and we had a discussion on the parking standards, and we had a discussion on the parking standards, and we had a discussion on the parking standards, and we had a discussion on the parking standards, and we had a discussion on the parking standards, and we had a discussion on the parking standards, and we had a discussion on the parking standards, and we had a discussion on the parking standards, and we had a discussion on the parking standards, and we had a discussion on the parking standards, and we had a discussion on the parking standards, and we had a discussion on the parking standards, and we had a discussion on the parking standards, and we had a discussion on the parking standards, and we had a discussion on the parking standards, and we had a discussion on the parking standards, and we had a discussion on the parking standards, and we had a discussion on the parking standards, and we had a discussion on the parking standards, and we had a discussion on the parking standards, and we had a discussion on the parking standards, and we had a discussion on the parking standards, and we had a discussion on the parking standards, and we had a discussion on the parking standards, and we had a discussion on the parking standards, and we had a discussion on the parking standards, and we had a discussion on the parking standards, and we had a discussion on the parking standards, and we had a discussion on the parking standards, and we had a discussion on the parking standards, and we had a discussion on the parking standards, and we had a discussion on the parking standards, and we had a discussion on the parking standards, and we had a discussion on the parking standards, and we had a discussion on the parking standards, and we had a discussion on the