WEBVTT 00:00:00.000 --> 00:00:05.000 - Okay, it is nine o'clock, so we'll call to order the City 00:00:05.000 --> 00:00:12.360 of Denton Public Utilities Board for August 24th. 00:00:12.360 --> 00:00:14.080 - You may sign off and come back on. 00:00:14.080 --> 00:00:19.080 - Before we go into public comment period, 00:00:19.080 --> 00:00:23.800 we're going to change the agenda a little bit. 00:00:23.800 --> 00:00:27.320 We need to have the closed session before we do items 00:00:27.320 --> 00:00:29.960 for individual consideration and the work session. 00:00:29.960 --> 00:00:34.120 So we'll do the consent agenda, 00:00:34.120 --> 00:00:36.640 then we'll go into closed meeting, 00:00:36.640 --> 00:00:38.360 then we'll go into work session 00:00:38.360 --> 00:00:41.480 and then the final item will be the individual consideration. 00:00:41.480 --> 00:00:45.280 So public comment period, does anybody wish to speak? 00:00:45.280 --> 00:00:47.000 Is there anybody there, Billy? 00:00:47.000 --> 00:00:52.880 No? 00:00:52.880 --> 00:00:55.680 Kim, is there anybody on the line that wishes to speak? 00:00:57.720 --> 00:00:59.240 - She's shaking her head. 00:00:59.240 --> 00:01:01.680 - She's shaking her head, no, okay, all right. 00:01:01.680 --> 00:01:05.680 And we'll go into the regular meeting, consent agenda. 00:01:05.680 --> 00:01:08.680 Does any board member wish to pull either item A or B 00:01:08.680 --> 00:01:10.120 on the consent agenda? 00:01:10.120 --> 00:01:17.160 - Madam Chair, I would like to pull consent agenda item A 00:01:17.160 --> 00:01:19.200 so that we get a little bit of an update 00:01:19.200 --> 00:01:21.080 from staff on that, thank you. 00:01:21.080 --> 00:01:24.200 - Okay, we still can't see you Lee, can you? 00:01:25.560 --> 00:01:28.360 - I think my only option is to try to log back in. 00:01:28.360 --> 00:01:31.040 - Okay. 00:01:31.040 --> 00:01:32.520 - I will do that now. 00:01:32.520 --> 00:01:33.560 - Okay, thank you. 00:01:33.560 --> 00:01:38.160 All right, do we have a motion to approve item B then? 00:01:38.160 --> 00:01:39.840 - I'd actually like to pull B. 00:01:39.840 --> 00:01:41.840 - Oh, you wanna pull B, okay, all right. 00:01:41.840 --> 00:01:44.440 Very good, that'll make it easier. 00:01:44.440 --> 00:01:47.840 So until Lee can get back on, 00:01:47.840 --> 00:01:50.360 why don't we take item B first? 00:01:50.360 --> 00:01:53.560 We need to see Lee's-- - Okay. 00:01:56.000 --> 00:01:57.440 Really, just a quick question. 00:01:57.440 --> 00:02:06.560 So the facility was built over 50 years ago, it says, 00:02:06.560 --> 00:02:11.520 and we've been using it the whole time, of course. 00:02:11.520 --> 00:02:15.640 So I was curious what kind of what longevity might we get 00:02:15.640 --> 00:02:17.640 out of these proposed changes? 00:02:17.640 --> 00:02:21.720 - So Madam Chair, we should have Stephen Gay on the phone. 00:02:21.720 --> 00:02:22.560 Stephen. 00:02:25.600 --> 00:02:27.840 - Yes, Tony, this is Stephen Gay, 00:02:27.840 --> 00:02:29.360 Director of Water Utilities. 00:02:29.360 --> 00:02:33.600 The longevity, the useful life of these filters 00:02:33.600 --> 00:02:36.440 are approximately 30 to 40 years. 00:02:36.440 --> 00:02:40.400 Does that make sense? 00:02:40.400 --> 00:02:43.040 - Yeah, that's great, that's a long time. 00:02:43.040 --> 00:02:43.880 - Yes. 00:02:43.880 --> 00:02:50.840 - Okay, do we have a motion to approve item B? 00:02:50.840 --> 00:02:55.080 - So moved. 00:02:55.080 --> 00:02:56.120 - In a second? 00:02:56.120 --> 00:02:56.960 - Second. - Second. 00:02:56.960 --> 00:03:02.760 - Aye. - Aye. 00:03:02.760 --> 00:03:08.720 - Any nays? 00:03:08.720 --> 00:03:12.800 Okay, all right, then item A. 00:03:12.800 --> 00:03:16.360 We switched up the order, Lee, so you could get on. 00:03:16.360 --> 00:03:19.440 So what is your question on item A? 00:03:19.440 --> 00:03:23.440 - Yes, I was just wondering if we could get some background 00:03:23.440 --> 00:03:28.440 on item A, the added $1.98 million amendment. 00:03:28.440 --> 00:03:36.040 - So we have Danny Kramer on the line, PV member. 00:03:36.040 --> 00:03:37.800 So Danny, could you respond, please? 00:03:37.800 --> 00:03:41.640 - Oh, yes, can everybody hear me? 00:03:41.640 --> 00:03:43.080 - Yes. - Yes, sir. 00:03:43.080 --> 00:03:48.440 - Okay, Daniel Kramer, Deputy Director of Operations, 00:03:48.440 --> 00:03:50.480 so streets, traffic and drainage. 00:03:50.480 --> 00:03:53.160 And what we use this contract for 00:03:53.160 --> 00:03:55.960 is mainly our curb and gutter repair, 00:03:55.960 --> 00:04:00.280 our sidewalk repairs and any valley gutters 00:04:00.280 --> 00:04:02.960 or the miscellaneous concrete repairs 00:04:02.960 --> 00:04:04.800 that we use throughout the city. 00:04:04.800 --> 00:04:08.120 Utilities also uses it on utility cuts 00:04:08.120 --> 00:04:12.120 when they do curb cuts and any of the flowable fill 00:04:12.120 --> 00:04:14.040 that needs to be put in the trenches 00:04:14.040 --> 00:04:15.880 when we're going through. 00:04:15.880 --> 00:04:20.880 As stated in the AIS, we are going out for a new contract. 00:04:22.240 --> 00:04:24.680 This one expires in October. 00:04:24.680 --> 00:04:26.800 This is just to fill the gap 00:04:26.800 --> 00:04:29.040 'cause we've spent the allotted money 00:04:29.040 --> 00:04:31.600 on the contract already. 00:04:31.600 --> 00:04:36.600 So this is to help us keep going in our repairs 00:04:36.600 --> 00:04:39.280 throughout the rest of the contract term 00:04:39.280 --> 00:04:41.720 so we can go out and get a new contract in place. 00:04:41.720 --> 00:04:47.440 - Alrighty, so this is merely an extension 00:04:47.440 --> 00:04:48.760 of the existing contract 00:04:48.760 --> 00:04:53.480 and it's for general repairs and work, nothing specific. 00:04:53.480 --> 00:05:00.000 - Correct, we do have a few that we listed in the AIS. 00:05:00.000 --> 00:05:02.360 The million dollars on the street side 00:05:02.360 --> 00:05:05.200 is some repairs that we're trying to finish up 00:05:05.200 --> 00:05:10.200 on Carroll Boulevard of some sunken panels, 00:05:10.200 --> 00:05:12.080 panel replacements for that, 00:05:12.080 --> 00:05:14.360 that we're just doing spot repairs on 00:05:14.360 --> 00:05:19.360 and miscellaneous water and wastewater cuts 00:05:19.360 --> 00:05:22.280 that we're doing there are the main culprits 00:05:22.280 --> 00:05:23.560 to the increase in costs. 00:05:23.560 --> 00:05:26.640 - Alrighty then, well, thank you very much. 00:05:26.640 --> 00:05:29.880 I didn't glean that from the documentation 00:05:29.880 --> 00:05:32.400 so I appreciate the updated information. 00:05:32.400 --> 00:05:35.480 So with that, Madam Chairman, 00:05:35.480 --> 00:05:37.960 I'm happy to move the approval of item A. 00:05:37.960 --> 00:05:39.640 - Okay, do we have a second? 00:05:39.640 --> 00:05:41.520 - Second. 00:05:41.520 --> 00:05:43.720 - All in favor say aye. 00:05:43.720 --> 00:05:44.560 - Aye. 00:05:44.560 --> 00:05:46.200 - Aye. 00:05:46.200 --> 00:05:47.280 - That carries. 00:05:47.280 --> 00:05:49.600 Okay, so next item is the closed session 00:05:49.600 --> 00:05:53.000 and I'll read the full thing here. 00:05:53.000 --> 00:05:54.360 - Then Karen, I mean, Susan, 00:05:54.360 --> 00:05:57.160 we'll move into this council room 00:05:57.160 --> 00:05:58.720 if you want to take a few minute break. 00:05:58.720 --> 00:06:01.080 - Okay, we'll go maybe five minutes. 00:06:01.080 --> 00:06:01.920 Would that be enough? 00:06:01.920 --> 00:06:02.920 - After. 00:06:02.920 --> 00:06:03.880 - Actually-- 00:06:03.880 --> 00:06:06.320 - Oh no, I'm sorry, I got it wrong, yeah. 00:06:06.320 --> 00:06:07.160 - Yeah. 00:06:07.160 --> 00:06:08.000 - You're gonna stay there? 00:06:08.000 --> 00:06:08.920 - They're gonna remain there 00:06:08.920 --> 00:06:11.000 and then once you go back into open, 00:06:11.000 --> 00:06:12.840 into the work session, then they'll go there. 00:06:12.840 --> 00:06:14.200 They'll go, okay. 00:06:14.200 --> 00:06:15.640 - Yes, ma'am. 00:06:15.640 --> 00:06:18.440 - All right, so here of course the closed session is. 00:06:18.440 --> 00:06:20.800 Any final action, decision or vote on a matter 00:06:20.800 --> 00:06:22.360 deliberated in a closed session 00:06:22.360 --> 00:06:25.080 will only be taken in an open meeting that is, 00:06:25.080 --> 00:06:27.440 oh, that's not the part I need to read, is it? 00:06:27.440 --> 00:06:31.560 Do I need to read that section, Tony? 00:06:31.560 --> 00:06:35.120 No. 00:06:35.120 --> 00:06:38.160 So the item is deliberations 00:06:38.160 --> 00:06:40.200 regarding certain public power utilities 00:06:40.200 --> 00:06:45.200 and competitive matters under Texas Code Section 551.086. 00:06:45.200 --> 00:06:47.920 Receive a presentation from staff 00:06:47.920 --> 00:06:49.640 containing public power information 00:06:49.640 --> 00:06:52.280 related to a proposed purchase agreement 00:06:52.280 --> 00:06:53.880 between the City of Denton 00:06:53.880 --> 00:06:57.160 as the seller of power and electricity energy services 00:06:57.160 --> 00:06:58.920 and Core Scientific Inc. 00:06:58.920 --> 00:07:02.480 Discuss and deliberate actions regarding the same. 00:07:02.480 --> 00:07:04.240 All right, now we can go into close. 00:07:09.800 --> 00:07:13.920 Okay, it is 10.01 and we'll go back into the open session 00:07:13.920 --> 00:07:16.240 of the Public Utilities Board meeting. 00:07:16.240 --> 00:07:20.040 The next item is the work session to receive a report, 00:07:20.040 --> 00:07:21.880 hold a discussion and give staff direction 00:07:21.880 --> 00:07:24.400 on the proposed water and wastewater rates 00:07:24.400 --> 00:07:26.960 for fiscal year 2021 and 2022. 00:07:39.040 --> 00:07:41.460 (indistinct) 00:07:41.460 --> 00:07:46.740 - Hate to state the obvious, but we got some feedback. 00:07:46.740 --> 00:07:49.000 (laughing) 00:08:09.200 --> 00:08:11.620 (indistinct) 00:08:11.620 --> 00:08:26.400 - I don't think this camera's working. 00:08:26.400 --> 00:08:28.400 The camera's not working. 00:08:28.400 --> 00:08:29.700 The camera's not working. 00:08:29.700 --> 00:08:32.760 Tess? 00:08:39.040 --> 00:08:41.460 (indistinct) 00:08:41.460 --> 00:08:48.480 Hey, Kim, can you tell him 00:08:48.480 --> 00:08:50.960 the camera's not working on this one? 00:08:50.960 --> 00:08:54.600 The video, the video, it won't work. 00:08:54.600 --> 00:08:57.200 It won't let me uncheck it, like it just marked out. 00:09:09.040 --> 00:09:11.460 (indistinct) 00:09:11.460 --> 00:09:28.800 Yep, the video doesn't need to work. 00:09:28.800 --> 00:09:31.720 Okay, okay, perfect, okay, good. 00:09:31.720 --> 00:09:32.920 - We can see you on the big screen. 00:09:32.920 --> 00:09:36.620 - Okay, perfect, I'll go ahead and get started. 00:09:36.620 --> 00:09:37.720 If everybody can hear me now, 00:09:37.720 --> 00:09:38.840 I think the microphone's working, 00:09:38.840 --> 00:09:41.360 so I'll speak up as loud as I need to. 00:09:41.360 --> 00:09:43.640 Nick Vinson, Assistant Director of Finance. 00:09:43.640 --> 00:09:44.920 It's my pleasure to be in front of you today 00:09:44.920 --> 00:09:46.280 as we continue our conversations 00:09:46.280 --> 00:09:50.200 regarding the fiscal year 2021-22 rate discussion 00:09:50.200 --> 00:09:51.980 for the utilities. 00:09:51.980 --> 00:09:55.320 So today we'll discuss water and wastewater. 00:09:55.320 --> 00:09:57.680 We do have individual consideration items for this 00:09:57.680 --> 00:10:00.560 later in the presentation for approval or the meeting. 00:10:00.560 --> 00:10:02.520 One thing I do wanna say before we get started, 00:10:02.520 --> 00:10:03.960 the electric rate ordinance this year 00:10:03.960 --> 00:10:05.280 will not come forward to you. 00:10:05.280 --> 00:10:06.660 If you remember the conversation we had, 00:10:06.660 --> 00:10:09.920 those rates will come back forward to you in December, 00:10:09.920 --> 00:10:11.680 along with the miscellaneous rate ordinance 00:10:11.680 --> 00:10:13.000 if there is any changes. 00:10:13.000 --> 00:10:16.880 So let me pull the presentation up. 00:10:16.880 --> 00:10:28.600 Okay, so really quick, what we wanted to do 00:10:28.600 --> 00:10:30.400 is just give an overview of the presentation 00:10:30.400 --> 00:10:31.360 that came forward to you. 00:10:31.360 --> 00:10:33.520 A few weeks ago in the conversation, 00:10:33.520 --> 00:10:34.600 we have a city council. 00:10:34.600 --> 00:10:37.480 So prior direction on July 26th, 00:10:37.480 --> 00:10:39.080 we did talk to the Public Utility Board 00:10:39.080 --> 00:10:41.600 regarding the water and wastewater rates 00:10:41.600 --> 00:10:44.600 and the rates quite frankly for each of the utilities. 00:10:44.600 --> 00:10:46.540 The direction we did get from the Public Utility Board 00:10:46.540 --> 00:10:49.400 at that time was to proceed with option three. 00:10:49.400 --> 00:10:51.860 And if you remember option three established a new tier 00:10:51.860 --> 00:10:54.040 from zero to 5,000 gallons. 00:10:54.040 --> 00:10:56.180 And it also combined that seasonal rate 00:10:56.180 --> 00:10:58.040 of that winter and summer block structures. 00:10:58.040 --> 00:11:00.480 We'll review that with you here shortly. 00:11:00.480 --> 00:11:04.200 We did go to city council the day after on July 27th. 00:11:04.200 --> 00:11:05.800 Presentation went well. 00:11:05.800 --> 00:11:07.960 The city council did request additional detail 00:11:07.960 --> 00:11:09.600 regarding the 11% of customers 00:11:09.600 --> 00:11:11.200 that would see a rate increase. 00:11:11.200 --> 00:11:12.680 So I'll review that with you here shortly. 00:11:12.680 --> 00:11:14.460 We have dived into that greater. 00:11:14.460 --> 00:11:17.120 But then their direction was the same 00:11:17.120 --> 00:11:18.280 as the Public Utility Board. 00:11:18.280 --> 00:11:21.120 A few questions was asked about the zero to 5,000 tier, 00:11:21.120 --> 00:11:22.440 where that came from. 00:11:22.440 --> 00:11:24.440 Staff was able to answer those questions. 00:11:24.440 --> 00:11:25.980 And their guidance they gave us 00:11:25.980 --> 00:11:27.880 was to proceed with that option. 00:11:27.880 --> 00:11:30.560 However, city council did ask for an additional tier 00:11:30.560 --> 00:11:32.080 or the possibility of additional tier 00:11:32.080 --> 00:11:34.640 between five and 15,000 gallons. 00:11:34.640 --> 00:11:37.080 So I'll review that with you also. 00:11:37.080 --> 00:11:38.640 Just a quick overview of the presentation. 00:11:38.640 --> 00:11:39.940 You can see the current rate structure. 00:11:39.940 --> 00:11:42.160 We'll review that here shortly. 00:11:42.160 --> 00:11:43.560 We'll look at the detailed analysis. 00:11:43.560 --> 00:11:45.360 We'll look at the 11% of customers 00:11:45.360 --> 00:11:48.640 and what our recommendation is to the Public Utility Board. 00:11:48.640 --> 00:11:55.800 Take my glasses off here, fogging up a little bit. 00:11:55.800 --> 00:11:57.960 So the current rate structure within water, 00:11:57.960 --> 00:11:59.320 as we talked about last time, 00:11:59.320 --> 00:12:02.280 there are two different fees within the water rate structure, 00:12:02.280 --> 00:12:03.920 the first one being a facility charge 00:12:03.920 --> 00:12:05.920 and the second one being a volume charge. 00:12:05.920 --> 00:12:09.020 As a reminder, that facility charge is a fixed fee 00:12:09.020 --> 00:12:12.460 based on the meter size that a residential customer has. 00:12:12.460 --> 00:12:13.800 The volume charge, of course, 00:12:13.800 --> 00:12:15.480 is the focus of today's conversation 00:12:15.480 --> 00:12:18.040 talking about the different volumetric rates 00:12:18.040 --> 00:12:19.640 within the water rate structure. 00:12:19.640 --> 00:12:22.920 The average consumption, as a reminder, 00:12:22.920 --> 00:12:24.560 previously was 9,200 gallons. 00:12:24.560 --> 00:12:27.120 We have seen that decrease from the last four or five years 00:12:27.120 --> 00:12:29.000 to 7,600 gallons. 00:12:29.000 --> 00:12:30.500 We'll talk a little bit more about that 00:12:30.500 --> 00:12:32.560 in our rate comparisons here shortly. 00:12:32.560 --> 00:12:39.080 So everybody, let me minimize it. 00:12:39.080 --> 00:12:40.640 Everybody saw this last time 00:12:40.640 --> 00:12:43.400 but just wanted to review it with a group again. 00:12:43.400 --> 00:12:44.980 So you can see the bill distribution 00:12:44.980 --> 00:12:46.780 of where that 11% is coming from. 00:12:46.780 --> 00:12:49.240 So currently, in our current tier structure 00:12:49.240 --> 00:12:54.120 from zero to 15,000, 89% of the bills fit into this tier. 00:12:54.120 --> 00:12:57.700 From 15,001 gallon to greater than 50,000 gallons, 00:12:57.700 --> 00:12:59.840 there's 11% of customers. 00:12:59.840 --> 00:13:01.960 And then those customers, as we discussed last time, 00:13:01.960 --> 00:13:03.920 actually see a rate increase 00:13:03.920 --> 00:13:06.560 with this new proposed rate structure. 00:13:06.560 --> 00:13:09.480 And we'll review that with you here shortly. 00:13:09.480 --> 00:13:11.480 And then this table just basically shows you 00:13:11.480 --> 00:13:14.560 the distribution of water consumption per 1,000 gallons. 00:13:14.560 --> 00:13:16.120 So you can see the majority of customers 00:13:16.120 --> 00:13:18.320 fitting in between 1,000, 00:13:18.320 --> 00:13:21.620 leading up to 13, 14, and 15,000 gallons. 00:13:21.620 --> 00:13:23.560 - Nick? - Yes, ma'am. 00:13:23.560 --> 00:13:26.840 - Could you give me an example of the 1%, 00:13:26.840 --> 00:13:28.440 the 50,000 plus? 00:13:28.440 --> 00:13:32.360 - So that's a great question, Ms. Russell. 00:13:32.360 --> 00:13:34.680 One thing we did look at is we looked at that, 00:13:34.680 --> 00:13:36.600 and I have a slide that I'll cover in just a second 00:13:36.600 --> 00:13:41.600 because we did try to break it into the size of partial. 00:13:41.600 --> 00:13:43.280 So is it a certain size partial 00:13:43.280 --> 00:13:45.280 that fits that 1% definition? 00:13:45.280 --> 00:13:46.600 And the answer is no. 00:13:46.600 --> 00:13:47.920 We did not find a correlation 00:13:47.920 --> 00:13:50.320 between water usage and partial size. 00:13:50.320 --> 00:13:52.360 So I think a lot of it has to do with habits, 00:13:52.360 --> 00:13:53.960 water consumption habits, 00:13:53.960 --> 00:13:55.520 and how people water their yards, 00:13:55.520 --> 00:13:58.160 maybe their irrigation systems are set, 00:13:58.160 --> 00:13:59.960 what type of appliances they have in their house. 00:13:59.960 --> 00:14:02.360 So I don't have a clear definition for you 00:14:02.360 --> 00:14:05.040 exactly who's in the 1% category. 00:14:05.040 --> 00:14:07.120 - I was just wondering, in the city of Denton, 00:14:07.120 --> 00:14:10.440 is there someone that uses 50,000 gallons? 00:14:10.440 --> 00:14:11.840 - There is. 00:14:11.840 --> 00:14:13.480 It does vary throughout the year. 00:14:13.480 --> 00:14:16.200 So for a residential customer, 00:14:16.200 --> 00:14:18.240 what we did see is there's 1% of the bills 00:14:18.240 --> 00:14:20.560 fit into that 50,000 gallon window. 00:14:20.560 --> 00:14:24.060 Now, what I will tell you is that varies throughout the year. 00:14:24.060 --> 00:14:25.800 So this year, for example, it just rained 00:14:25.800 --> 00:14:29.160 a couple inches last week, people tend to water less. 00:14:29.160 --> 00:14:31.440 So it may not be every month out of the year. 00:14:31.440 --> 00:14:33.240 It may just be a few months out of the year. 00:14:33.240 --> 00:14:34.520 But if we have a really dry year, 00:14:34.520 --> 00:14:37.040 there could be someone that uses over 50,000 gallons. 00:14:37.040 --> 00:14:38.320 Absolutely. 00:14:38.320 --> 00:14:39.160 Yeah. 00:14:39.160 --> 00:14:41.240 And we'll talk a little bit more about that in just a second. 00:14:41.240 --> 00:14:42.080 Yeah. 00:14:42.080 --> 00:14:44.280 Okay, let me... 00:14:44.280 --> 00:14:46.280 Sorry, I should have stopped sharing that. 00:14:46.280 --> 00:14:50.680 Okay, so this really dives into that 11%. 00:14:50.680 --> 00:14:53.800 Just wanted to really update the PEB on what staff did 00:14:53.800 --> 00:14:55.480 and the great job that the water utility 00:14:55.480 --> 00:14:57.800 helped us look at these customers. 00:14:57.800 --> 00:15:00.760 So the 11% equates to about 3,600 customers 00:15:00.760 --> 00:15:04.060 that use on an average over 15,000 gallons. 00:15:04.060 --> 00:15:06.100 As I'd said, that fluctuates throughout the year. 00:15:06.100 --> 00:15:08.360 One month, it could be a little bit more than that. 00:15:08.360 --> 00:15:10.640 Next month, it could be a little bit less than that. 00:15:10.640 --> 00:15:13.960 But we did sit on an average about 3,600. 00:15:13.960 --> 00:15:16.720 What we did is we took basically the water consumption data 00:15:16.720 --> 00:15:19.040 from customer service, all the water consumption 00:15:19.040 --> 00:15:20.960 in the city for every single meter 00:15:20.960 --> 00:15:24.360 within residential customers with the help of water. 00:15:24.360 --> 00:15:26.000 Really grateful for their help. 00:15:26.000 --> 00:15:27.540 We took that data and we plotted it 00:15:27.540 --> 00:15:29.680 by partials within Denton. 00:15:29.680 --> 00:15:32.240 And then what that did is that allowed us to look 00:15:32.240 --> 00:15:34.480 at the geographical map, right? 00:15:34.480 --> 00:15:37.840 And look at the area of town that those customers fit into. 00:15:37.840 --> 00:15:39.600 I will tell you that there is no correlation 00:15:39.600 --> 00:15:41.960 between lot size and water consumption, 00:15:41.960 --> 00:15:43.480 as I said, Ms. Russell, just a while ago. 00:15:43.480 --> 00:15:45.760 So what we did is to summarize the detail, 00:15:45.760 --> 00:15:48.280 we put together this bar chart just to kind of give you 00:15:48.280 --> 00:15:49.840 an example of how those customers fit 00:15:49.840 --> 00:15:52.000 into the different categories. 00:15:52.000 --> 00:15:54.240 So at the bottom, you can see consumption. 00:15:54.240 --> 00:15:56.920 So 10 to 5,000 gallons consumption. 00:15:56.920 --> 00:16:01.720 You can see 5,001 to 7,500, 7,500 to 15, 00:16:01.720 --> 00:16:03.880 15 to 30, and then 30 to 90. 00:16:03.880 --> 00:16:09.240 You see this light blue color, that is the partial size 00:16:09.240 --> 00:16:12.960 for a 10 to 12,000 square foot piece of property. 00:16:12.960 --> 00:16:16.800 The orange is 12,000 to 20, that is the partial size 00:16:16.800 --> 00:16:18.920 for that color, and then so forth going down. 00:16:18.920 --> 00:16:21.960 So you can see a bigger partial, one acre above, 00:16:21.960 --> 00:16:25.280 is really this brownish orange color here 00:16:25.280 --> 00:16:26.800 that's at the very bottom. 00:16:26.800 --> 00:16:29.200 So if you start over here to the very left of the table, 00:16:29.200 --> 00:16:33.520 you can see a partial from 10 gallons of usage 00:16:33.520 --> 00:16:34.880 to 5,000 gallons. 00:16:34.880 --> 00:16:37.560 The partial size that had the most consumption 00:16:37.560 --> 00:16:39.840 or the most properties within that category 00:16:39.840 --> 00:16:42.680 were 10 to 12,000 square feet. 00:16:42.680 --> 00:16:44.960 As you get to the larger consumption categories, 00:16:44.960 --> 00:16:47.080 you look out here at 15 to 30, 00:16:47.080 --> 00:16:50.080 one would tend to think that a partial size 00:16:50.080 --> 00:16:53.160 plays a big role into that water consumption. 00:16:53.160 --> 00:16:55.360 One thing we did see within that data 00:16:55.360 --> 00:16:57.080 is that some of the smaller partials 00:16:57.080 --> 00:16:59.680 actually use more water than those bigger partials, 00:16:59.680 --> 00:17:01.600 even a one acre lot or bigger. 00:17:01.600 --> 00:17:05.200 So just really, you know, looking at the data staff 00:17:05.200 --> 00:17:07.960 was not able to tie it down to a certain partial size 00:17:07.960 --> 00:17:10.720 to say, you know, a half acre lot or a one acre lot 00:17:10.720 --> 00:17:13.760 meets the definition of someone using over 15,000 gallons. 00:17:13.760 --> 00:17:17.280 It's very possible for someone to have a 12,000 square foot 00:17:17.280 --> 00:17:20.240 lot and use 5,000 gallons worth of water. 00:17:20.240 --> 00:17:22.320 So we did dive into it. 00:17:22.320 --> 00:17:24.520 Just wanted to make sure we pointed this out. 00:17:24.520 --> 00:17:31.000 So rate options for the water utility. 00:17:31.000 --> 00:17:32.480 We talked about these last time, 00:17:32.480 --> 00:17:34.720 but we wanted to explore just put in front 00:17:34.720 --> 00:17:37.480 of the public utility board one additional option 00:17:37.480 --> 00:17:40.280 that we came up with after talking to city council. 00:17:40.280 --> 00:17:42.680 So as I'd said earlier, the public utility board 00:17:42.680 --> 00:17:46.600 did give us consent to move forward with option three. 00:17:46.600 --> 00:17:49.200 That is in front of you today for consideration. 00:17:49.200 --> 00:17:51.080 That is still staff's recommendation. 00:17:51.080 --> 00:17:53.520 And that's still consistent with the cost of service model 00:17:53.520 --> 00:17:55.480 that we completed a few months ago. 00:17:55.480 --> 00:18:00.160 One thing we did look at is we looked at an option four 00:18:00.160 --> 00:18:02.280 that would introduce an additional tier 00:18:02.280 --> 00:18:05.320 between the 5,000 and 15,000 gallon range. 00:18:05.320 --> 00:18:08.360 And I'll review that with you down here at the bottom. 00:18:08.360 --> 00:18:10.280 So starting the very left of the screen, 00:18:10.280 --> 00:18:11.680 you can see the current rate structure 00:18:11.680 --> 00:18:13.280 with the winter and summer blocks. 00:18:13.280 --> 00:18:16.560 You can see option three introduces a new tier 00:18:16.560 --> 00:18:20.680 from zero to 5,000 gallons, the rate being 363. 00:18:20.680 --> 00:18:23.840 And then that next tier being five to 15, 405. 00:18:23.840 --> 00:18:28.840 You can notice as you go up higher, 15 to 30 at 712, 00:18:28.840 --> 00:18:33.840 30 to 50 at 953, and then over 50,000 gallons is 1179. 00:18:33.840 --> 00:18:36.280 So each one of these options are revenue neutral. 00:18:36.280 --> 00:18:38.920 That is achieved by decreasing the rates 00:18:38.920 --> 00:18:39.880 for the lower customer. 00:18:39.880 --> 00:18:42.120 So those customers will see a rate decrease 00:18:42.120 --> 00:18:44.040 under 15,000 gallons. 00:18:44.040 --> 00:18:46.600 And that revenue is being made up by a rate increase 00:18:46.600 --> 00:18:48.520 for customers over 15,000 gallons. 00:18:48.520 --> 00:18:51.400 So really meant to incentivize that water conservation 00:18:51.400 --> 00:18:53.360 within this utility. 00:18:53.360 --> 00:18:55.160 Option four, what it does, 00:18:55.160 --> 00:18:58.520 it does break up that five to 15,000 gallon tier, 00:18:58.520 --> 00:19:01.680 adding in an additional tier from five to 7,000 gallons. 00:19:01.680 --> 00:19:04.960 And that rate for that tier being $3.90. 00:19:04.960 --> 00:19:07.600 And this is achieved by further increasing that rate 00:19:07.600 --> 00:19:09.360 for those higher tier customers. 00:19:09.360 --> 00:19:11.240 So anyone over 15,000 gallons 00:19:11.240 --> 00:19:13.560 would even see more of a rate increase. 00:19:13.560 --> 00:19:16.480 Status recommendation now is to proceed with option three, 00:19:16.480 --> 00:19:18.640 which is the consultant's recommendation, 00:19:18.640 --> 00:19:21.520 and see how the movement between the tiers 00:19:21.520 --> 00:19:23.280 occurs in the coming months. 00:19:23.280 --> 00:19:25.160 And then come back to you possibly next year 00:19:25.160 --> 00:19:28.560 with some additional tiers of as the guidance we get. 00:19:28.560 --> 00:19:32.880 So each one of these options are revenue neutral. 00:19:32.880 --> 00:19:34.720 But one thing they currently, 00:19:34.720 --> 00:19:36.320 and this is pointed out later in the presentation, 00:19:36.320 --> 00:19:39.000 they do not consume is movement within the tiers. 00:19:39.000 --> 00:19:40.840 So for example, if a lot of customers, 00:19:40.840 --> 00:19:44.240 that 11% of customers start using less than 15,000 gallons, 00:19:44.240 --> 00:19:45.680 there is a possibility that this utility 00:19:45.680 --> 00:19:47.320 could see a revenue decrease. 00:19:47.320 --> 00:19:48.680 So we wanted to make sure we pointed that out 00:19:48.680 --> 00:19:50.080 to the Public Utility Board. 00:19:50.080 --> 00:19:54.880 Residential rate comparison. 00:19:54.880 --> 00:19:58.680 So same numbers, 89% are 29,197. 00:19:58.680 --> 00:20:01.600 Other residential customers will see a rate decrease. 00:20:01.600 --> 00:20:04.320 And those 11% of customers will see an increase. 00:20:04.320 --> 00:20:06.960 One thing I did wanna show the Public Utilities Board is, 00:20:06.960 --> 00:20:09.400 you know, what could a customer expect that they did use 00:20:09.400 --> 00:20:11.120 over 15,000 gallons? 00:20:11.120 --> 00:20:12.360 We don't want people to be surprised. 00:20:12.360 --> 00:20:13.520 We want them to know exactly 00:20:13.520 --> 00:20:16.160 what their bill is going to go to. 00:20:16.160 --> 00:20:19.960 And so you can see a 7,600 gallon customer using 7,600, 00:20:19.960 --> 00:20:21.800 which is that average per month 00:20:21.800 --> 00:20:25.080 is currently paying $46.62. 00:20:25.080 --> 00:20:28.320 You can see in the blue that customer paid $44.52. 00:20:28.320 --> 00:20:30.600 So a decrease of $2.10. 00:20:30.600 --> 00:20:33.920 15,000 gallons just showing that max 00:20:33.920 --> 00:20:36.520 that you can use and still receive a rate decrease. 00:20:36.520 --> 00:20:38.760 Currently paying 76.59. 00:20:38.760 --> 00:20:40.000 Under option three, 00:20:40.000 --> 00:20:42.880 which is staff's recommendation is 74.49, 00:20:42.880 --> 00:20:45.640 they would see a $2.10 decrease also. 00:20:45.640 --> 00:20:48.560 So when you get up into the 30,000 gallon water usage, 00:20:48.560 --> 00:20:51.000 they're currently paying 162.99. 00:20:51.000 --> 00:20:53.640 That bill would go to 181.29 00:20:53.640 --> 00:20:57.160 for an $18.30 increase a month. 00:20:57.160 --> 00:21:00.160 If you were a customer and you used over 50,000 gallons, 00:21:00.160 --> 00:21:03.200 your bill is currently 321.99. 00:21:03.200 --> 00:21:08.200 That bill would go to 371.89 for a $50 increase a month, 00:21:08.200 --> 00:21:10.560 so $49.90. 00:21:10.560 --> 00:21:14.120 So just kind of want to point out some different examples 00:21:14.120 --> 00:21:15.680 across the spectrum, 00:21:15.680 --> 00:21:17.600 as you could see what those rate increases are. 00:21:17.600 --> 00:21:19.800 - Do you have a screen that shows the gross revenue change 00:21:19.800 --> 00:21:20.880 with these estimates? 00:21:20.880 --> 00:21:23.160 - Let me stop sharing this really quick. 00:21:23.160 --> 00:21:25.320 I think I forgot last time. 00:21:25.320 --> 00:21:26.480 Great question. 00:21:26.480 --> 00:21:29.120 So each option is currently revenue neutral. 00:21:29.120 --> 00:21:32.200 So if you see the ones increasing for the higher users 00:21:32.200 --> 00:21:34.200 and see it decreasing for the lower users, 00:21:34.200 --> 00:21:36.040 that's just revenue neutral to the fund. 00:21:36.040 --> 00:21:38.120 If we didn't increase those rates for the higher tier 00:21:38.120 --> 00:21:40.720 and we just let the fund take that revenue impact, 00:21:40.720 --> 00:21:43.120 it'd be six to 700,000 a year. 00:21:43.120 --> 00:21:44.520 - Okay. - Yeah. 00:21:44.520 --> 00:21:45.360 Yeah, if we just said, 00:21:45.360 --> 00:21:46.520 "Hey, we don't want to increase it for the higher tiers. 00:21:46.520 --> 00:21:48.440 "We just want to decrease it for the lower tiers." 00:21:48.440 --> 00:21:51.160 Six to 700,000, absolutely. 00:21:51.160 --> 00:21:53.760 - And then kind of follow up to that is, 00:21:53.760 --> 00:21:56.680 so thinking if usage, 00:21:56.680 --> 00:21:58.600 behavior changes and usage drops, 00:21:58.600 --> 00:22:00.120 obviously revenue would drop, 00:22:01.000 --> 00:22:03.680 but would that also mean that our costs drop? 00:22:03.680 --> 00:22:06.360 And so do you know what kind of impact that might have? 00:22:06.360 --> 00:22:09.560 I mean, obviously knowing how much usage drops 00:22:09.560 --> 00:22:11.400 is very variable. 00:22:11.400 --> 00:22:12.240 - Right. 00:22:12.240 --> 00:22:14.400 - But I wondered how those are related. 00:22:14.400 --> 00:22:17.200 - So that's a great question. 00:22:17.200 --> 00:22:18.400 And we actually had a follow up question 00:22:18.400 --> 00:22:21.200 very similar to that because if we see a big shift 00:22:21.200 --> 00:22:23.320 in usage within the water utility, 00:22:23.320 --> 00:22:26.480 could it possibly delay some of those plant expansions? 00:22:26.480 --> 00:22:28.240 And really after visiting with Stephen Gay, 00:22:28.240 --> 00:22:30.600 the director of water, is what we come to find out 00:22:30.600 --> 00:22:32.840 is we have to plan on the peak demand. 00:22:32.840 --> 00:22:35.400 So even if those usage and those consumption habits 00:22:35.400 --> 00:22:38.160 of the consumer change a little bit or decrease, 00:22:38.160 --> 00:22:41.160 we really wouldn't see too much of a decrease in expenses. 00:22:41.160 --> 00:22:43.200 We would still be planning for the peak demand. 00:22:43.200 --> 00:22:45.240 We'd still be planning for those chemicals 00:22:45.240 --> 00:22:47.240 or those different items to treat the water. 00:22:47.240 --> 00:22:50.200 So hopefully that answers your question is really, 00:22:50.200 --> 00:22:51.400 since we're planning on the peak, 00:22:51.400 --> 00:22:53.800 it really wouldn't decrease expenses very much. 00:22:53.800 --> 00:22:59.800 Okay, let me pull this back up. 00:23:01.320 --> 00:23:04.080 (mouse clicking) 00:23:04.080 --> 00:23:09.880 Okay, so commercial rate recommendations 00:23:09.880 --> 00:23:11.000 won't spend too much time on this. 00:23:11.000 --> 00:23:12.400 We visited about this last time. 00:23:12.400 --> 00:23:14.920 No recommended changes to the commercial rate structure 00:23:14.920 --> 00:23:18.040 for regular commercial water usage. 00:23:18.040 --> 00:23:20.120 Currently is not a seasonal rate. 00:23:20.120 --> 00:23:22.200 There is one fee for a facility charge 00:23:22.200 --> 00:23:25.040 based on the meter size and then one volume charge 00:23:25.040 --> 00:23:27.640 based on that water usage per thousand gallons. 00:23:27.640 --> 00:23:28.960 I was just looking to keep this the same. 00:23:28.960 --> 00:23:31.760 Just wanted to put this in front of the Public Utilities Board. 00:23:31.760 --> 00:23:35.320 Commercial irrigation to simplify this rate structure, 00:23:35.320 --> 00:23:38.360 we are recommending that we combine the winter and summer rate 00:23:38.360 --> 00:23:40.040 into one blended rate. 00:23:40.040 --> 00:23:42.240 And you can see currently for a winter, 00:23:42.240 --> 00:23:44.640 the volume metric rate is 434. 00:23:44.640 --> 00:23:46.400 For summer it's $6. 00:23:46.400 --> 00:23:50.480 And that combined, we're looking to introduce a 575 rate. 00:23:50.480 --> 00:23:53.800 And this would result in a decrease of approximately $10.65 00:23:53.800 --> 00:23:55.600 for commercial customers. 00:23:55.600 --> 00:23:57.980 And if you recall, in our cost service study, 00:23:57.980 --> 00:23:59.840 commercial customers are over recovering. 00:23:59.840 --> 00:24:01.760 So this is a step in the right direction 00:24:01.760 --> 00:24:03.600 for cost recovery purposes. 00:24:03.600 --> 00:24:08.240 Wholesale rates, we reviewed these last time. 00:24:08.240 --> 00:24:10.120 I did want to point out to the Public Utility Board, 00:24:10.120 --> 00:24:12.800 we have made one update that is in the rate ordinance 00:24:12.800 --> 00:24:14.000 for your consideration today. 00:24:14.000 --> 00:24:16.400 It is our wholesale raw water pass-through rate. 00:24:16.400 --> 00:24:18.840 And this number has been updated based on the June CPI 00:24:18.840 --> 00:24:21.800 adjuster that's come available since the last time we talked. 00:24:21.800 --> 00:24:25.640 The last time we showed you the rate is 0.0282 proposed. 00:24:25.640 --> 00:24:29.120 We are looking to propose 0.0285 based on that adjuster. 00:24:29.120 --> 00:24:33.360 Wastewater rate changes. 00:24:33.360 --> 00:24:34.840 We talked a little bit about these last time. 00:24:34.840 --> 00:24:36.760 Dino-soil per cubic yard. 00:24:36.760 --> 00:24:39.120 We are looking to increase that from 30 to 35 00:24:39.120 --> 00:24:41.960 based on cost of service of making this material 00:24:41.960 --> 00:24:44.840 and demand of it has been up here lately. 00:24:44.840 --> 00:24:46.520 And then you can see some discount rates 00:24:46.520 --> 00:24:49.080 if you were to buy 10 to 99 yards 00:24:49.080 --> 00:24:52.440 or a hundred plus yards getting 40% off. 00:24:55.120 --> 00:24:56.880 So rate changes, just a little bit of history 00:24:56.880 --> 00:25:00.200 back from fiscal year 2015 to current. 00:25:00.200 --> 00:25:02.120 We're not really showing a rate decrease this year. 00:25:02.120 --> 00:25:03.440 We're just redoing the rate structure. 00:25:03.440 --> 00:25:05.720 So it's something definitely we can add in the future. 00:25:05.720 --> 00:25:09.200 But you can see up to fiscal year 2017, 00:25:09.200 --> 00:25:12.040 we had annual rate increases since 2018. 00:25:12.040 --> 00:25:14.560 Actually had some rate decreases moving forward 00:25:14.560 --> 00:25:16.040 and no rate changes at all. 00:25:16.040 --> 00:25:21.040 So just rate recommendations, really quick one to recap it. 00:25:21.040 --> 00:25:23.360 So option three, as we talked about, 00:25:23.360 --> 00:25:25.320 this is staff's recommendation. 00:25:25.320 --> 00:25:27.120 The recommendation that was the guidance we received 00:25:27.120 --> 00:25:29.240 from the PV and city council. 00:25:29.240 --> 00:25:32.280 And is also consistent with the consultant's recommendation 00:25:32.280 --> 00:25:35.520 of stepping into new tiers for the water utility. 00:25:35.520 --> 00:25:37.680 Commercial water service option one 00:25:37.680 --> 00:25:39.240 for the regular water service 00:25:39.240 --> 00:25:42.280 to maintain our current rate structure, no change. 00:25:42.280 --> 00:25:45.040 And then option two for the irrigation rates, 00:25:45.040 --> 00:25:48.160 which is combining the winter and summer rate structure. 00:25:48.160 --> 00:25:50.520 And then the wholesale water service adjustments 00:25:50.520 --> 00:25:52.200 in accordance with contracts. 00:25:52.200 --> 00:25:53.240 And then those wastewater, 00:25:53.240 --> 00:25:55.560 just those cost of service adjustments. 00:25:55.560 --> 00:25:57.400 And then lastly, just point out the risk 00:25:57.400 --> 00:25:58.640 associated with the new rate structures 00:25:58.640 --> 00:25:59.800 we talked about before. 00:25:59.800 --> 00:26:01.640 Each option is revenue neutral. 00:26:01.640 --> 00:26:03.280 It does not contemplate customers 00:26:03.280 --> 00:26:05.120 changing their consumption habits. 00:26:05.120 --> 00:26:07.160 If they drastically reduce their water usage, 00:26:07.160 --> 00:26:10.040 there is a risk of this fund to have a revenue decrease. 00:26:10.040 --> 00:26:11.560 So we can revisit that as next year, 00:26:11.560 --> 00:26:12.400 update you accordingly 00:26:12.400 --> 00:26:14.600 as we proceed through the next fiscal year. 00:26:14.600 --> 00:26:17.800 And then upcoming next steps. 00:26:17.800 --> 00:26:20.640 So this presentation will go to city council tomorrow. 00:26:20.640 --> 00:26:22.320 We are coming up on the public hearings, 00:26:22.320 --> 00:26:23.560 which are September 14th. 00:26:23.560 --> 00:26:25.240 So just a few weeks away. 00:26:25.240 --> 00:26:28.120 And in September 21st, we do have the budget adoption, 00:26:28.120 --> 00:26:30.080 the tax rate and the rates scheduled 00:26:30.080 --> 00:26:31.640 to be adopted by city council. 00:26:31.640 --> 00:26:35.000 And that concludes the presentation. 00:26:35.000 --> 00:26:36.480 I'll pull down for questions. 00:26:36.480 --> 00:26:47.040 - Madam chair, I don't have a question but I have a comment. 00:26:47.040 --> 00:26:48.840 I like the city council's approach 00:26:48.840 --> 00:26:50.920 of adding the additional tier. 00:26:50.920 --> 00:26:54.080 So I'm certainly would be in favor of that. 00:26:54.080 --> 00:27:01.320 - I think either way is good. 00:27:01.320 --> 00:27:02.680 I'd support either option. 00:27:02.680 --> 00:27:07.960 - Yeah, as somebody who's gonna be paying more 00:27:07.960 --> 00:27:10.240 because my husband loves his lawn, 00:27:10.240 --> 00:27:15.360 either arrangement would be fine with me. 00:27:15.360 --> 00:27:19.240 I want him to feel the pain of watering 00:27:19.240 --> 00:27:21.440 that stupid St. Augustine. 00:27:21.440 --> 00:27:24.600 So I'm totally in favor of the tier approach 00:27:24.600 --> 00:27:27.440 because we just use too much water. 00:27:27.440 --> 00:27:31.520 - I think the difference between the five 00:27:31.520 --> 00:27:34.560 and the five and $7,000 or 7,000 gallon tiers 00:27:34.560 --> 00:27:35.800 is so minimal. 00:27:35.800 --> 00:27:39.880 I don't even, I don't see much of a difference 00:27:39.880 --> 00:27:44.640 for the end user just to maybe a few cents. 00:27:44.640 --> 00:27:45.960 So either one. 00:27:45.960 --> 00:27:51.480 - And I'm good with either one too. 00:27:51.480 --> 00:27:56.080 But if the consultant is also saying option three, 00:27:56.080 --> 00:27:59.080 then I'd be more in favor of option three. 00:27:59.080 --> 00:28:02.600 - And then chair, if I may, 00:28:02.600 --> 00:28:03.880 the ordinances in front of you today 00:28:03.880 --> 00:28:05.440 is based on option three. 00:28:05.440 --> 00:28:06.840 Staff's recommendation would be 00:28:06.840 --> 00:28:09.080 is to adopt the ordinance as it is, 00:28:09.080 --> 00:28:10.720 circle back with the public utilities board 00:28:10.720 --> 00:28:12.760 next fiscal year once we understand the movement 00:28:12.760 --> 00:28:13.600 within the fund. 00:28:13.600 --> 00:28:15.160 And then we can really dial in 00:28:15.160 --> 00:28:17.320 where those tiers need to be created, so. 00:28:17.320 --> 00:28:19.120 - Okay. 00:28:19.120 --> 00:28:23.520 Yeah, that is on the second item 00:28:23.520 --> 00:28:25.840 on the individual consideration, so. 00:28:25.840 --> 00:28:31.120 Okay. 00:28:31.120 --> 00:28:32.240 Any other questions? 00:28:32.240 --> 00:28:34.360 Thank you, Nick. 00:28:34.360 --> 00:28:41.280 Okay, so let's go into items for individual consideration. 00:28:41.280 --> 00:28:43.200 The first item is consider approval 00:28:43.200 --> 00:28:46.040 of the August 9th, 2021 minutes. 00:28:46.040 --> 00:28:47.880 Do we have a motion to approve? 00:28:47.880 --> 00:28:53.760 - So moved. 00:28:53.760 --> 00:28:54.880 - Thank you, Karen. 00:28:54.880 --> 00:28:56.440 And do we have a second? 00:28:56.440 --> 00:28:57.280 - Second. 00:28:57.280 --> 00:29:00.240 - All in favor say aye. 00:29:00.240 --> 00:29:01.440 - Aye. 00:29:01.440 --> 00:29:03.960 - And I'm going to abstain that wasn't there, so. 00:29:03.960 --> 00:29:05.640 And I didn't watch it, so. 00:29:05.640 --> 00:29:08.680 Second item is consider recommending 00:29:08.680 --> 00:29:09.960 the adoption of an ordinance, 00:29:09.960 --> 00:29:12.800 establishing the rates for water and water service, 00:29:12.800 --> 00:29:14.640 providing for repealer, 00:29:14.640 --> 00:29:16.560 providing for several ability clause 00:29:16.560 --> 00:29:18.640 and providing for an effective date. 00:29:18.640 --> 00:29:22.560 - So do you want to make the motion 00:29:22.560 --> 00:29:24.560 including the comments from the PUB? 00:29:24.560 --> 00:29:26.360 Is that probably the appropriate way? 00:29:26.360 --> 00:29:30.480 - You can make the motion to adopt the ordinance 00:29:30.480 --> 00:29:31.800 as presented in front of you today 00:29:31.800 --> 00:29:34.080 if you wanted to at sports option three, 00:29:34.080 --> 00:29:36.600 that was previously the direction staff received. 00:29:36.600 --> 00:29:39.520 Any true question, Mr. Chief? 00:29:39.520 --> 00:29:41.840 - Yeah, I just know that we had a naysayer here 00:29:41.840 --> 00:29:45.200 and I wanted to see what we needed to do about that 00:29:45.200 --> 00:29:47.560 to pass the rate, Susan. 00:29:47.560 --> 00:29:54.080 - I would say we could pass it as it is presented today 00:29:54.080 --> 00:29:57.320 and with the following up in another year, 00:29:57.320 --> 00:30:01.360 'cause I believe was suggesting that the extra. 00:30:01.360 --> 00:30:07.080 - Uh oh, you're out. 00:30:11.760 --> 00:30:13.080 I just froze. 00:30:13.080 --> 00:30:14.960 - You did, but you're back now. 00:30:14.960 --> 00:30:15.800 - Okay. 00:30:15.800 --> 00:30:19.600 Yeah, it's saying my internet connection is unstable. 00:30:19.600 --> 00:30:20.440 I don't know. 00:30:20.440 --> 00:30:25.880 Did you hear what I said? 00:30:25.880 --> 00:30:27.080 - No. 00:30:27.080 --> 00:30:28.240 - No, okay. 00:30:28.240 --> 00:30:31.040 What I said was we could approve it as it is 00:30:31.040 --> 00:30:34.520 with the comment to come back and review it 00:30:34.520 --> 00:30:37.080 after another year to see if the changes occurred. 00:30:37.080 --> 00:30:39.720 I just went out again, didn't I? 00:30:39.720 --> 00:30:41.040 - No, you're still here. 00:30:41.040 --> 00:30:41.880 - Okay. 00:30:41.880 --> 00:30:45.360 Everybody else was frozen on my end. 00:30:45.360 --> 00:30:52.120 - I'll make a motion to approve as presented. 00:30:52.120 --> 00:30:55.920 - I'll second. 00:30:55.920 --> 00:30:56.760 - Thank you, Karen. 00:30:56.760 --> 00:30:58.440 All in favor say aye. 00:30:58.440 --> 00:30:59.880 - Aye. 00:30:59.880 --> 00:31:00.720 - Opposed? 00:31:00.720 --> 00:31:03.880 Okay, that carries. 00:31:03.880 --> 00:31:06.520 Next item is consider recommending adoption 00:31:06.520 --> 00:31:08.400 of an ordinance establishing the rates 00:31:08.400 --> 00:31:11.320 for fighting for repealer, 00:31:11.320 --> 00:31:13.360 providing for a severability clause 00:31:13.360 --> 00:31:15.280 and providing for an effective date. 00:31:15.280 --> 00:31:20.800 - Chair, I don't have a present. 00:31:20.800 --> 00:31:23.560 I do have a presentation if you'd like to see it. 00:31:23.560 --> 00:31:25.360 I'd be happy to pull it up. 00:31:25.360 --> 00:31:27.200 Otherwise, just looking for your approval. 00:31:27.200 --> 00:31:28.040 - Yeah. 00:31:28.040 --> 00:31:30.080 Do we have a motion to approve? 00:31:30.080 --> 00:31:30.920 - So moved. 00:31:30.920 --> 00:31:33.360 - And a second. 00:31:33.360 --> 00:31:34.200 - Second. 00:31:34.200 --> 00:31:37.240 - I think that was Barbara. 00:31:37.240 --> 00:31:38.840 All in favor say aye. 00:31:38.840 --> 00:31:39.680 - Aye. 00:31:39.680 --> 00:31:41.440 - Opposed? 00:31:41.440 --> 00:31:46.720 Consider recommending an adoption of an ordinance 00:31:46.720 --> 00:31:49.840 of the city of Denton, Texas establishing for the rates 00:31:49.840 --> 00:31:52.600 for solid waste and recycling collection service, 00:31:52.600 --> 00:31:56.600 repealing ordinance number 20, 1551, 00:31:56.600 --> 00:31:57.920 providing for repealer, 00:31:57.920 --> 00:31:59.920 providing for severability clause 00:31:59.920 --> 00:32:02.560 and providing for an effective date. 00:32:02.560 --> 00:32:06.080 I think this is the same, right Nick, that presentation? 00:32:06.080 --> 00:32:06.920 - It is the same. 00:32:06.920 --> 00:32:08.080 I saw the presentation last time. 00:32:08.080 --> 00:32:09.480 If anybody wishes to see it, I can pull it up. 00:32:09.480 --> 00:32:12.000 Otherwise, I just need your approval. 00:32:12.000 --> 00:32:13.520 - We have a motion to approve. 00:32:13.520 --> 00:32:15.200 - Move approval. 00:32:15.200 --> 00:32:17.800 - Thank you. 00:32:17.800 --> 00:32:18.640 Thank you. 00:32:18.640 --> 00:32:23.840 Opposed? 00:32:23.840 --> 00:32:24.880 I'm back. 00:32:24.880 --> 00:32:26.400 - There you are. 00:32:26.400 --> 00:32:28.120 Did we all, call it again. 00:32:28.120 --> 00:32:29.640 Call the vote again. 00:32:29.640 --> 00:32:30.640 - Okay. 00:32:30.640 --> 00:32:32.080 Do we have a motion? 00:32:32.080 --> 00:32:34.600 No, we have a motion and a second. 00:32:34.600 --> 00:32:36.120 All in favor say aye. 00:32:36.120 --> 00:32:36.960 - Aye. 00:32:36.960 --> 00:32:39.520 - And opposed? 00:32:39.520 --> 00:32:40.920 That carries. 00:32:40.920 --> 00:32:43.200 Consider recommending adoption of an ordinance 00:32:43.200 --> 00:32:44.320 of the city of Denton, 00:32:44.320 --> 00:32:47.280 a Texas Home Rural Municipal Corporation, 00:32:47.280 --> 00:32:49.960 authorizing the city manager to execute a lease 00:32:49.960 --> 00:32:51.960 with Core Scientific Inc. 00:32:51.960 --> 00:32:54.840 for approximately 30 acres of city owned property 00:32:54.840 --> 00:32:59.840 located in the Moses H. Davis Survey, abstract number 377, 00:32:59.840 --> 00:33:03.520 in the Johnson Green Myers and Brumlett Survey, 00:33:03.520 --> 00:33:06.440 abstract number 1699, 00:33:06.440 --> 00:33:09.040 all in the city and county of Denton, Texas 00:33:09.040 --> 00:33:11.240 and providing for an effective date. 00:33:11.240 --> 00:33:18.240 - Good morning, Madam Chairman. 00:33:18.240 --> 00:33:22.480 It's Terry Nolte, DME Assistant General Manager. 00:33:22.480 --> 00:33:27.720 I think if it's all right with the city attorney, 00:33:27.720 --> 00:33:30.920 if you could call both that item and the following item, 00:33:30.920 --> 00:33:33.160 we could take them both up to same time. 00:33:33.160 --> 00:33:34.000 - All right. 00:33:34.000 --> 00:33:37.760 Consider recommending the adoption of an ordinance 00:33:37.760 --> 00:33:40.040 with the city of Denton, a Texas Home Rural 00:33:40.040 --> 00:33:44.720 Municipal Corporation approving a purchase power agreement 00:33:44.720 --> 00:33:47.200 between the city and Core Scientific, 00:33:47.200 --> 00:33:50.560 a Delaware corporation providing for the expenditure of funds 00:33:50.560 --> 00:33:52.320 and providing for an effective date. 00:33:52.320 --> 00:33:55.120 Okay. 00:33:55.120 --> 00:33:57.680 - Okay, let me share my screen real quick. 00:34:03.480 --> 00:34:04.880 - One moment, please. 00:34:04.880 --> 00:34:23.640 Okay, can everyone see that presentation? 00:34:23.640 --> 00:34:26.880 - Yes. - Okay. 00:34:26.880 --> 00:34:27.800 - Thank you. 00:34:27.800 --> 00:34:28.640 - Thank you. 00:34:28.640 --> 00:34:29.480 - Thank you. 00:34:29.480 --> 00:34:33.240 Is this presentation? - Yes. 00:34:33.240 --> 00:34:34.080 - Okay, I apologize. 00:34:34.080 --> 00:34:38.280 My computer is telling me I needed to update Zoom 00:34:38.280 --> 00:34:40.800 into the latest version at the same time. 00:34:40.800 --> 00:34:46.040 Okay, today we're here to talk about the proposed lease 00:34:46.040 --> 00:34:50.240 between the city of Denton and Core Scientific. 00:34:50.240 --> 00:34:54.280 Core Scientific is the proposed owner 00:34:54.280 --> 00:34:55.820 of the new data center. 00:34:56.880 --> 00:34:59.800 Should you and the council approve it, 00:34:59.800 --> 00:35:02.000 council is taking this up tomorrow. 00:35:02.000 --> 00:35:06.600 And I do have some participants from Core Scientific. 00:35:06.600 --> 00:35:09.800 Jeff Pratt is with us with Core Scientific 00:35:09.800 --> 00:35:14.240 and Chris Hemshot with Tanaska is with us as well 00:35:14.240 --> 00:35:15.640 to answer questions. 00:35:15.640 --> 00:35:21.720 So the proposed data center project 00:35:21.720 --> 00:35:23.920 that we've been in discussion with the city council, 00:35:23.920 --> 00:35:28.400 VME is proposing to lease two parcels of property 00:35:28.400 --> 00:35:30.960 at the Denton Energy Center. 00:35:30.960 --> 00:35:34.040 On the exhibit to the left, 00:35:34.040 --> 00:35:39.040 you can see the sites are both north and south 00:35:39.040 --> 00:35:41.440 of the existing Denton Energy Center. 00:35:41.440 --> 00:35:43.360 This is the Denton Energy Center here. 00:35:43.360 --> 00:35:48.880 Site two is on the north, site one is to the south. 00:35:48.880 --> 00:35:52.640 The airport is over here on the right-hand side. 00:35:52.640 --> 00:35:57.200 And this is a substation that's owned by Encore. 00:35:57.200 --> 00:35:59.560 This is the old Jim Crystal substation 00:35:59.560 --> 00:36:01.480 and here's Jim Crystal Road. 00:36:01.480 --> 00:36:07.760 The property was rezoned to light industrial 00:36:07.760 --> 00:36:11.040 last week by action of the city council. 00:36:11.040 --> 00:36:15.840 The total lease area is to be 30 acres. 00:36:15.840 --> 00:36:18.640 It consists of both of these two parcels. 00:36:18.640 --> 00:36:23.640 And as the development will include development 00:36:23.640 --> 00:36:29.400 of two phases on the site down here 00:36:29.400 --> 00:36:34.040 and then a third final phase on the north site here. 00:36:34.040 --> 00:36:39.280 The term lease is a seven-year lease 00:36:39.280 --> 00:36:42.480 with one seven-year extension term. 00:36:45.360 --> 00:36:49.640 The lease is co-terminus with the power purchase agreement 00:36:49.640 --> 00:36:55.200 and the lease and the power purchase agreement 00:36:55.200 --> 00:36:59.200 have cross-default provisions so that a default 00:36:59.200 --> 00:37:02.600 under either agreement would result in a default 00:37:02.600 --> 00:37:04.880 under the other agreement. 00:37:04.880 --> 00:37:07.320 Likewise, with respect to terminations, 00:37:07.320 --> 00:37:10.240 a termination of either agreement would result 00:37:10.240 --> 00:37:12.960 in a termination of the other agreement. 00:37:14.080 --> 00:37:18.680 The lease rate is $10,075 per month. 00:37:18.680 --> 00:37:20.720 It is subject to escalations 00:37:20.720 --> 00:37:24.720 based on CPI adjustments every two years. 00:37:24.720 --> 00:37:30.880 And it is a market-based rate that was determined 00:37:30.880 --> 00:37:32.600 by the real estate department. 00:37:32.600 --> 00:37:39.080 One thing that's important is that as you all are aware, 00:37:39.080 --> 00:37:42.120 the debt energy center as well as the substation 00:37:42.120 --> 00:37:46.520 adjacent to the center have tight access controls 00:37:46.520 --> 00:37:51.120 and the lease prohibits and restricts access 00:37:51.120 --> 00:37:53.520 to those controlled areas on the site. 00:37:53.520 --> 00:38:03.640 The bulk of the terms and conditions of this transaction 00:38:03.640 --> 00:38:06.280 have to deal with the disposition of equipment, 00:38:06.280 --> 00:38:10.880 improvements that are made on the property 00:38:10.880 --> 00:38:13.120 during the term of the agreement. 00:38:13.120 --> 00:38:19.240 And with that, we would recommend adoption. 00:38:19.240 --> 00:38:26.120 And as I said earlier, Madam Chair, 00:38:26.120 --> 00:38:29.280 we do have someone here, Mr. Pratt, 00:38:29.280 --> 00:38:34.280 from Course Scientific Online 00:38:34.280 --> 00:38:37.800 who's available to answer questions. 00:38:37.800 --> 00:38:40.960 And I've got a few slides that we could go over with. 00:38:40.960 --> 00:38:43.240 - Questions. 00:38:43.240 --> 00:38:46.080 Barbara, I think you had a couple of questions. 00:38:46.080 --> 00:38:47.520 - Yes, I did, thank you. 00:38:47.520 --> 00:38:52.480 How old is your company and how long, 00:38:52.480 --> 00:38:57.160 what is the length of time at your various locations? 00:38:57.160 --> 00:39:00.400 What length of time have you been in operation there? 00:39:00.400 --> 00:39:03.560 - Sure, that's a great question. 00:39:03.560 --> 00:39:06.120 We actually have one slide kind of on our timeline. 00:39:07.200 --> 00:39:11.120 Our founders started working in this area back in 2012, 00:39:11.120 --> 00:39:13.800 but Course Scientific as a legal entity 00:39:13.800 --> 00:39:16.360 was opened in December of 2017. 00:39:16.360 --> 00:39:21.600 And that's 2017 would be the year we expanded 00:39:21.600 --> 00:39:24.440 and opened in North Carolina. 00:39:24.440 --> 00:39:27.960 We followed in 2018 in Georgia. 00:39:27.960 --> 00:39:31.440 And in 2019, we expanded into Kentucky. 00:39:31.440 --> 00:39:35.880 Here in 2021, we're expanding into North Dakota. 00:39:35.880 --> 00:39:38.520 And hopefully, we're excited about this relationship 00:39:38.520 --> 00:39:41.360 and opportunity with the city of Denton 00:39:41.360 --> 00:39:42.840 to move into Texas as well. 00:39:42.840 --> 00:39:47.240 So this would be our fourth real full year of operation 00:39:47.240 --> 00:39:49.160 entering our fifth year. 00:39:49.160 --> 00:39:52.760 - Thank you. 00:39:52.760 --> 00:39:57.040 - So the very next slide actually shows that timeline. 00:39:57.040 --> 00:40:00.440 And I'm happy to flip back and forth 00:40:00.440 --> 00:40:01.480 and answer any questions. 00:40:01.480 --> 00:40:02.720 I'm happy to give a short overview. 00:40:02.720 --> 00:40:05.120 I wanna use your time. 00:40:05.120 --> 00:40:06.640 I know everybody's always busy on time. 00:40:06.640 --> 00:40:11.000 So whatever is most useful to this committee or board, 00:40:11.000 --> 00:40:14.040 I'm happy to use the time that would make it helpful to you. 00:40:14.040 --> 00:40:18.240 - Are there questions? 00:40:18.240 --> 00:40:26.320 - I do have a few questions. 00:40:26.320 --> 00:40:28.080 This is really about the land layout 00:40:28.080 --> 00:40:31.600 and some more for probably VME staff. 00:40:33.000 --> 00:40:36.200 Is it possible to pull back up the map 00:40:36.200 --> 00:40:39.880 in the presentation showing the parcels for trucks? 00:40:39.880 --> 00:40:42.480 - Sure. 00:40:42.480 --> 00:40:56.320 - And I'm suspecting that site one and site two are chosen 00:40:56.320 --> 00:40:58.960 for the proximity to the switch gear there, 00:40:58.960 --> 00:41:02.240 the 138KV substation. 00:41:03.440 --> 00:41:04.280 - That's correct. 00:41:04.280 --> 00:41:07.920 This is the substation, the Jim Crystal substation. 00:41:07.920 --> 00:41:13.960 Phase one and two will be fed out of the substation. 00:41:13.960 --> 00:41:19.480 You'll notice along the edge here, 00:41:19.480 --> 00:41:21.080 you can't see 'em exactly, 00:41:21.080 --> 00:41:25.480 but we have 138KV transmission lines 00:41:25.480 --> 00:41:27.440 that run north to south. 00:41:27.440 --> 00:41:31.520 And then there's the substation here with Encore. 00:41:31.520 --> 00:41:33.920 There's a transmission line that runs 00:41:33.920 --> 00:41:36.160 through the Encore substation as well. 00:41:36.160 --> 00:41:41.440 - And I just wanna, I'm curious if there's been any work 00:41:41.440 --> 00:41:46.440 to lay out this potential future tracks 00:41:46.440 --> 00:41:53.800 so that as additional leases or additional development 00:41:53.800 --> 00:41:58.280 or potentially solar or other uses go in here 00:41:58.280 --> 00:42:03.280 that we have good, consistent layout with access 00:42:03.280 --> 00:42:09.840 and noticing the distance between my future Luke 288 00:42:09.840 --> 00:42:14.840 and the eastern edge of both of these lease contracts. 00:42:14.840 --> 00:42:21.000 It's fairly small, if we were to have another potential leaser 00:42:21.000 --> 00:42:26.880 on the east side of future 288 or southern property 00:42:27.840 --> 00:42:30.840 and so forth, is there a plan to kind of... 00:42:30.840 --> 00:42:37.080 - Yeah, the site is actually quite constrained 00:42:37.080 --> 00:42:40.360 by easements due to the fact that we have 00:42:40.360 --> 00:42:43.600 so many transmission lines, distribution lines, 00:42:43.600 --> 00:42:47.560 and gas supply pipelines crossing the site. 00:42:47.560 --> 00:42:52.560 And so there really isn't additional available property 00:42:52.560 --> 00:42:55.520 for development on the deck site. 00:42:55.520 --> 00:43:00.520 The Luke 288 will hive off a pretty good section 00:43:00.520 --> 00:43:03.200 of the east side of the property. 00:43:03.200 --> 00:43:08.200 And then on the east side of the future 288 loop 00:43:08.200 --> 00:43:13.160 is airport property and the city is actually in discussions 00:43:13.160 --> 00:43:17.280 or working on design for the use of that property 00:43:17.280 --> 00:43:18.840 for other city functions. 00:43:18.840 --> 00:43:23.960 - Okay, so it sounds like there isn't much other opportunity 00:43:23.960 --> 00:43:25.440 for future leases. 00:43:25.440 --> 00:43:29.200 - No, there's a small segment up against 00:43:29.200 --> 00:43:33.360 Jim Crystal Road that could be leased, 00:43:33.360 --> 00:43:37.160 but it's, you have to transact a couple 00:43:37.160 --> 00:43:40.920 environmentally sensitive areas to get to that property. 00:43:40.920 --> 00:43:43.760 - Thank you. 00:43:43.760 --> 00:43:48.920 - All right, other questions? 00:43:52.880 --> 00:43:54.760 All right, do we have a motion then 00:43:54.760 --> 00:43:57.440 to approve the lease agreement? 00:43:57.440 --> 00:44:01.520 - I'll move to approve. 00:44:01.520 --> 00:44:04.320 - Second. - Second. 00:44:04.320 --> 00:44:11.480 - I froze, so who moved it? 00:44:11.480 --> 00:44:14.080 - Benjumper moved to approve. 00:44:14.080 --> 00:44:14.920 - Okay. 00:44:14.920 --> 00:44:19.040 - And I guess Devin, you seconded? 00:44:19.040 --> 00:44:20.280 - I'll second, yeah. 00:44:20.280 --> 00:44:23.000 - All right, so all in favor say aye. 00:44:23.000 --> 00:44:24.520 - Aye. - Aye. 00:44:24.520 --> 00:44:25.360 - Opposed? 00:44:25.360 --> 00:44:27.400 Sorry about this internet connection. 00:44:27.400 --> 00:44:30.120 That carries. 00:44:30.120 --> 00:44:32.240 - Thank you, the court. 00:44:32.240 --> 00:44:36.280 - Verification, you had two items for consideration, 00:44:36.280 --> 00:44:38.080 which one was just moved in here? 00:44:38.080 --> 00:44:39.600 - Just the lease, I'm sorry. 00:44:39.600 --> 00:44:41.640 - Okay, thank you. 00:44:41.640 --> 00:44:42.480 - You're welcome. 00:44:42.480 --> 00:44:47.160 - Madam Chairman, I do not have a formal presentation 00:44:47.160 --> 00:44:48.640 on the power purchase agreement, 00:44:48.640 --> 00:44:51.440 but I'd be glad to answer any questions that you might have. 00:44:51.440 --> 00:44:55.200 - Okay, are there further questions on the power agreement? 00:44:55.200 --> 00:45:01.680 I'm seeing none, all right, do we have a motion? 00:45:01.680 --> 00:45:03.120 Oh, I'm sorry, go ahead. 00:45:03.120 --> 00:45:05.040 (phone ringing) 00:45:05.040 --> 00:45:07.040 - I'm asking here, I wondered if they could comment 00:45:07.040 --> 00:45:10.840 about the internet connection agreement 00:45:10.840 --> 00:45:13.960 and their plans for that, since we have them here. 00:45:13.960 --> 00:45:16.280 - All right. 00:45:16.280 --> 00:45:17.960 - I apologize, there was a phone ringing 00:45:17.960 --> 00:45:19.040 when you asked that question. 00:45:19.040 --> 00:45:20.960 Mr. Rybak, could you please repeat? 00:45:20.960 --> 00:45:23.360 (phone ringing) 00:45:23.360 --> 00:45:26.320 - It's still ringing and I can't do much about it. 00:45:26.320 --> 00:45:28.520 - Hello, you've reached line four zero. 00:45:28.520 --> 00:45:31.320 - I was hoping that you might be able to give us 00:45:31.320 --> 00:45:34.400 a little sense of your operation of the agreement, 00:45:34.400 --> 00:45:38.480 since you guys are gonna be handling that interconnection. 00:45:38.480 --> 00:45:40.400 Since you're here, I thought we should take advantage 00:45:40.400 --> 00:45:41.800 of your presence. 00:45:41.800 --> 00:45:47.920 - Okay, I'm gonna repeat what I think is the question. 00:45:47.920 --> 00:45:50.600 So I think you're interested to hear about 00:45:50.600 --> 00:45:52.000 how we're going to handle the construction 00:45:52.000 --> 00:45:54.880 of the interconnection and work with Denton 00:45:54.880 --> 00:45:56.440 to build up the interconnection 00:45:56.440 --> 00:45:59.920 and then a smaller substation for each of the phases 00:45:59.920 --> 00:46:01.040 that were discussed. 00:46:01.040 --> 00:46:05.040 So the three phases, as Terry mentioned, 00:46:05.040 --> 00:46:08.640 the first phase is only 22 megawatts, 00:46:08.640 --> 00:46:11.600 that will be at distribution, so that will be all, 00:46:11.600 --> 00:46:14.640 any of the construction there will be handled by DMA. 00:46:14.640 --> 00:46:19.080 Moving into phase two, which will be hopefully starting up 00:46:19.080 --> 00:46:22.600 quickly assuming approval of council, 00:46:22.600 --> 00:46:27.600 that we will then be putting in a 158 megawatt transformer 00:46:27.600 --> 00:46:32.800 from 138 out of 34.5, and that will be on the south edge, 00:46:32.800 --> 00:46:34.800 the south track of the property. 00:46:34.800 --> 00:46:37.720 We have an EPC agreement with the SHIELD, 00:46:37.720 --> 00:46:40.080 who has done quite a bit of our construction 00:46:40.080 --> 00:46:41.520 for us in the past. 00:46:41.520 --> 00:46:44.800 They've worked on other substations for us 00:46:44.800 --> 00:46:46.600 and some of our other power plants. 00:46:46.600 --> 00:46:49.880 So they've been working on the site and been in contact, 00:46:49.880 --> 00:46:53.040 and we've had several meetings with Denton 00:46:53.040 --> 00:46:54.960 and the electrical engineers to coordinate 00:46:54.960 --> 00:46:58.200 and make sure that that is all coordinated well. 00:46:58.200 --> 00:47:00.840 We haven't started, we haven't finished, 00:47:00.840 --> 00:47:04.400 I would say the planning for phase three yet, 00:47:04.400 --> 00:47:06.280 but that will be quickly followed 00:47:06.280 --> 00:47:07.960 after we get started on phase two. 00:47:10.400 --> 00:47:11.680 - All right, thank you. 00:47:11.680 --> 00:47:12.520 I just thought we should take advantage 00:47:12.520 --> 00:47:14.960 of your presence today, so I appreciate that. 00:47:14.960 --> 00:47:17.160 - Absolutely, any other questions, please let me know. 00:47:17.160 --> 00:47:19.280 - The questions? 00:47:19.280 --> 00:47:22.560 All right, do we have a motion to approve 00:47:22.560 --> 00:47:25.680 the power purchase agreement between the city of Denton 00:47:25.680 --> 00:47:27.880 and Core Scientific Inc? 00:47:27.880 --> 00:47:28.720 - So moved. 00:47:28.720 --> 00:47:32.080 - I'll second. 00:47:32.080 --> 00:47:37.600 - All in favor say aye. 00:47:37.600 --> 00:47:38.720 - Aye. - Aye. 00:47:38.720 --> 00:47:39.560 - Opposed? 00:47:40.640 --> 00:47:41.480 - Opposed? 00:47:41.480 --> 00:47:43.920 Okay, parries. 00:47:43.920 --> 00:47:48.840 Management reports, am I frozen again? 00:47:48.840 --> 00:47:50.240 - No, Susan, you're fine. 00:47:50.240 --> 00:47:51.440 - All right. 00:47:51.440 --> 00:47:53.960 - So Madam Chair, members of the Board, 00:47:53.960 --> 00:47:55.920 Tony Puente, the DMV General Manager. 00:47:55.920 --> 00:47:59.680 In your management reports, we provided to you 00:47:59.680 --> 00:48:03.600 the DECK dashboards for the month of May and June. 00:48:03.600 --> 00:48:07.080 Certainly our folks from finance are here and available 00:48:07.080 --> 00:48:10.320 if you have any questions on either one of those reports. 00:48:11.240 --> 00:48:13.240 - Question, all right. 00:48:13.240 --> 00:48:17.200 - Okay, going to the future agenda items. 00:48:17.200 --> 00:48:20.440 Obviously today you've already approved the rates 00:48:20.440 --> 00:48:24.080 for wastewater and solid waste, I think Nick was clear 00:48:24.080 --> 00:48:26.760 that we've not brought to you the electric rate ordinance, 00:48:26.760 --> 00:48:29.160 the rate ordinance that was approved last year 00:48:29.160 --> 00:48:31.120 will continue to remain in effect. 00:48:31.120 --> 00:48:34.040 We'll certainly have a discussion with you later on 00:48:34.040 --> 00:48:36.480 this calendar year, but by the end of the calendar year, 00:48:36.480 --> 00:48:38.800 if there's any changes at the end of the year, 00:48:38.800 --> 00:48:41.040 if there's any changes at that point, 00:48:41.040 --> 00:48:43.960 then we'll bring that ordinance to you. 00:48:43.960 --> 00:48:47.880 But coming up on September 13th, we do have a draft 00:48:47.880 --> 00:48:50.480 of the comprehensive solid waste management strategy 00:48:50.480 --> 00:48:53.360 discussion that'll be brought to you by Brian Borner 00:48:53.360 --> 00:48:56.080 and the consultants that he's been working with. 00:48:56.080 --> 00:48:58.240 I know many of you have a lot of interest in that 00:48:58.240 --> 00:49:01.000 and we look forward to discussing that with you. 00:49:01.000 --> 00:49:04.560 And then going on to the new business action items, 00:49:04.560 --> 00:49:08.680 obviously, we've talked about the comprehensive 00:49:09.800 --> 00:49:12.840 solid waste report that'll include any discussions 00:49:12.840 --> 00:49:17.840 on recycling for, or composting for residential use. 00:49:17.840 --> 00:49:23.480 We're also still working on a recap of legislative items 00:49:23.480 --> 00:49:27.400 associated with the electric industry. 00:49:27.400 --> 00:49:31.920 And we're also working on an ISR for this issue 00:49:31.920 --> 00:49:35.560 of the solar installations and this 4CP issue 00:49:35.560 --> 00:49:38.000 that I think Terry already talked to you a little bit about. 00:49:38.000 --> 00:49:39.680 We are working on that for the council as well. 00:49:39.680 --> 00:49:41.560 We'll be providing that to you. 00:49:41.560 --> 00:49:44.480 As you know, the legislative, the governor, 00:49:44.480 --> 00:49:47.560 they call a second special session. 00:49:47.560 --> 00:49:51.120 I think they now have a quorum and they've started to meet. 00:49:51.120 --> 00:49:52.680 And so we'll see what comes out. 00:49:52.680 --> 00:49:55.840 If any of that, that may impact not just the DME, 00:49:55.840 --> 00:49:57.440 but any of our other utilities. 00:49:57.440 --> 00:50:00.680 We'll certainly keep you abreast of that information. 00:50:00.680 --> 00:50:03.040 So with that, happy answering questions 00:50:03.040 --> 00:50:05.040 on any of these items. 00:50:05.040 --> 00:50:08.560 I did mention, I did want to mention that we did send to you 00:50:08.560 --> 00:50:12.880 the latest bond rating for the utility system on Friday. 00:50:12.880 --> 00:50:15.920 Hopefully you received that in your email. 00:50:15.920 --> 00:50:17.920 If you didn't, please let me know. 00:50:17.920 --> 00:50:21.360 But again, happy to answer any questions on that as well. 00:50:21.360 --> 00:50:25.320 - Questions. 00:50:25.320 --> 00:50:28.680 All right. 00:50:28.680 --> 00:50:31.640 - Yes Madam Chair, I have a question. 00:50:31.640 --> 00:50:33.800 - It's just delayed, I'm so sorry. 00:50:33.800 --> 00:50:35.360 I'll be back next time. 00:50:35.360 --> 00:50:36.280 (laughing) 00:50:36.280 --> 00:50:39.840 - Well, we love technology when it works 00:50:39.840 --> 00:50:42.880 and we dislike it so much when it does. 00:50:42.880 --> 00:50:45.440 Anyway, my questions, Terry or Tony, 00:50:45.440 --> 00:50:48.320 my comment would be that on the bond ratings, 00:50:48.320 --> 00:50:51.640 I've noticed that both standard and poor and fixed 00:50:51.640 --> 00:50:54.000 seem to have come to the same conclusions 00:50:54.000 --> 00:50:55.880 and had almost identical comments. 00:50:55.880 --> 00:50:57.400 I just found that kind of interesting. 00:50:57.400 --> 00:50:58.480 Is that the norm? 00:50:58.480 --> 00:51:02.600 - Yeah, I think they both sometimes look at 00:51:02.600 --> 00:51:06.120 different metrics and different financial issues 00:51:06.120 --> 00:51:07.320 going on that may be impacting, 00:51:07.320 --> 00:51:09.080 but yes, you're exactly right. 00:51:09.080 --> 00:51:12.160 Previous to this time, we actually had different ratings 00:51:12.160 --> 00:51:14.280 from each one of the rating agencies. 00:51:14.280 --> 00:51:16.680 But yeah, so it's not uncommon, 00:51:16.680 --> 00:51:19.160 but I will tell you that they don't always look 00:51:19.160 --> 00:51:24.160 at the same things, but again, not uncommon. 00:51:24.160 --> 00:51:27.760 - Okay, and my follow-up would be the ratings to me 00:51:27.760 --> 00:51:31.800 based on all of our interesting problems in the past year 00:51:31.800 --> 00:51:34.520 didn't look that bad, so what was your take on them? 00:51:34.520 --> 00:51:37.080 Or what is our official take on them? 00:51:37.080 --> 00:51:39.160 Are they good, bad, and different? 00:51:39.160 --> 00:51:41.880 - Well, and I don't see David Gaines on here, 00:51:41.880 --> 00:51:43.680 so I'll have to speak on his behalf, 00:51:43.680 --> 00:51:48.680 but I think overall we still have a very good rating. 00:51:48.680 --> 00:51:54.520 It's still certainly above some of the B-rated entities 00:51:54.520 --> 00:51:57.000 that may be out there. 00:51:57.000 --> 00:51:59.960 Obviously, it's always a little bit disappointing 00:51:59.960 --> 00:52:02.480 when you get a downgrade, but again, we understand 00:52:02.480 --> 00:52:05.760 that that's happening across the Texas market, 00:52:05.760 --> 00:52:09.160 and so it wasn't necessarily a surprise, 00:52:09.160 --> 00:52:12.320 but certainly I think deals like the one 00:52:12.320 --> 00:52:16.360 that you approved today and certainly some of the 00:52:16.360 --> 00:52:20.840 conservative budgeting that we do at DME, 00:52:20.840 --> 00:52:25.040 we hope that going forward that will be well received. 00:52:25.040 --> 00:52:26.560 Hopefully, we'll also, by the end of the year, 00:52:26.560 --> 00:52:29.480 have the transmission cost of service study 00:52:29.480 --> 00:52:32.600 and filing behind us, so we'll have a better feel 00:52:32.600 --> 00:52:34.360 of what the impact's gonna be. 00:52:34.360 --> 00:52:37.760 So I think overall it wasn't unexpected. 00:52:37.760 --> 00:52:40.440 I think, from my perspective, the utility's 00:52:40.440 --> 00:52:43.160 in a very good financial position, 00:52:43.160 --> 00:52:46.520 and we hope that going forward things will continue 00:52:46.520 --> 00:52:50.760 to improve and maybe kind of get back to a rating 00:52:50.760 --> 00:52:53.560 that we think is more commensurate of kind of 00:52:53.560 --> 00:52:55.720 where we believe our utility system is. 00:53:00.280 --> 00:53:01.120 - Okay, sir. 00:53:01.120 --> 00:53:01.960 Well, thank you for that. 00:53:01.960 --> 00:53:03.680 Again, I thought under the circumstances 00:53:03.680 --> 00:53:08.440 it wasn't that bad, so thanks for the additional background. 00:53:08.440 --> 00:53:09.280 - Yes, sir. 00:53:09.280 --> 00:53:12.840 - All right, any other questions? 00:53:12.840 --> 00:53:16.360 All right, on to concluding items. 00:53:16.360 --> 00:53:19.280 Does any board member have anything they wish to have 00:53:19.280 --> 00:53:23.480 add to a future agenda or any comments to make at this time? 00:53:23.480 --> 00:53:26.160 - Just want to thank Karen for her service very much. 00:53:26.160 --> 00:53:28.640 It's been such a pleasure getting to know you. 00:53:28.640 --> 00:53:29.960 I think you're another one of those people 00:53:29.960 --> 00:53:32.440 that proved to me, no matter how big our town gets, 00:53:32.440 --> 00:53:34.800 it's still kind of a small town. 00:53:34.800 --> 00:53:35.880 - Absolutely, Pam. 00:53:35.880 --> 00:53:37.560 - Thanks, Billy. 00:53:37.560 --> 00:53:39.840 - I hope Billy's saying too. 00:53:39.840 --> 00:53:40.680 I'll miss you. 00:53:40.680 --> 00:53:43.240 - Oh, I'll be around. 00:53:43.240 --> 00:53:44.080 - I know. 00:53:44.080 --> 00:53:48.380 - Yeah, I just wanted to say thank you for, 00:53:48.380 --> 00:53:52.600 well, thank you to the staff for teaching me 00:53:52.600 --> 00:53:57.240 how the city government works. 00:53:57.240 --> 00:54:01.280 Utilities are a huge part of what City of Denton does, 00:54:01.280 --> 00:54:03.800 and I feel like I've got a better grasp 00:54:03.800 --> 00:54:07.520 of a very complicated animal now. 00:54:07.520 --> 00:54:09.880 So thanks to the staff, and I also appreciate 00:54:09.880 --> 00:54:12.960 all the creative thinking that goes on with the staff. 00:54:12.960 --> 00:54:15.720 Kudos to them. 00:54:15.720 --> 00:54:19.040 If Terry at all can pass that along 00:54:19.040 --> 00:54:20.660 to people who've presented to us. 00:54:20.660 --> 00:54:24.300 And thanks to the other board members. 00:54:24.300 --> 00:54:27.360 I think that this board has a real, 00:54:27.360 --> 00:54:32.080 very productive variety of points of view. 00:54:32.080 --> 00:54:33.520 We all bring something different, 00:54:33.520 --> 00:54:38.240 and I am very appreciative of how well we work together. 00:54:38.240 --> 00:54:40.380 Thank you, Susan, for keeping us in line. 00:54:40.380 --> 00:54:45.640 I'll be around. 00:54:45.640 --> 00:54:46.640 - I know you will. 00:54:46.640 --> 00:54:49.640 Anything else? 00:54:49.640 --> 00:54:53.880 All right, do we have a motion to adjourn? 00:54:55.280 --> 00:54:56.320 - Thank you. 00:54:56.320 --> 00:54:57.720 - So adjourned. - Billy? 00:54:57.720 --> 00:55:02.320 - Second. - All right. 00:55:02.320 --> 00:55:03.160 And you're second? 00:55:03.160 --> 00:55:04.800 Okay, we are adjourned. 00:55:04.800 --> 00:55:05.640 Thanks.