April 9th 2018 public utilities board meeting to order and
first on our agenda
is we have a work session with a couple of items. Item A is
to receive a report
hold a discussion give staff direction regarding the
location of the Ditten
Municipal Electric Mayhill substation easement. Well good
morning members of the
board my name is Ethan Cox I'm the director of solid waste
for the city of
Denton. We have a joint presentation for you this morning I
'll be accompanied by
Brent Heath from DME shortly. We're gonna be talking a
little bit about the Mayhill
substation and just to kind of refresh everyone's memory DM
E has basically gone
through a public input process in the 2013 to 2015 time
frame and a site was
selected for a substation that basically serves the Mayhill
area. The proposed
site at the time was approved through PUB and council and
it was actually
going to be located on landfill property. Thanks to some of
our staff and our work
with DME we've identified some issues with that location
that we want to kind
of bring to your attention this morning and then also
request some direction
from the board. So to start off I'm going to give you a
little bit of an overview of
the land that we have out at the landfill that's going to
be affected by
the substation site. As you may be aware we are actually
going through an
expansion permit through the TCEQ right now. Public comment
period is going to be
up in the spring time frame and we're hoping that we're
actually going to be
approved with a new permit in hand by the end of summer.
Very long and arduous
process but we're getting very near the finish line on that
. The goal of that
expansion permit was to increase our waste capacity for the
community to an
additional 50 plus years and what you have here on this
right hand side is
basically an aerial view if you kind of follow my mouse.
Where's my mouse? I don't
see it. There it is. All right there's my mouse. So we have
basically 11 future
landfill cells and I'm going to kind of orient you with
what you're seeing here
on this side. So Mayhill Road runs north to south right
here. This is the entrance
to our facility. You have the fueling island right here. Pr
att Recycling, our
home chemical collection building, our administrative
offices and then if you
follow this curve all of our existing landfill cells are
down here to the south.
So all these little rectangles where you see like 7a, 8a, 9
a, all of those are
future landfill cells that we would develop and serve as
future waste
disposal cells. Whenever the substation was brought to the
board and the council
previously DMU was operating under the assumption that none
of the substation
site would negatively affect any of these cell developments
. They had the
assurances of the prior director that that was the case.
Unfortunately that's
not the case whatsoever. Give you another visual here. This
is actually an aerial
same location. You can see the cells. This whole area kind
of encapsulated in
orange is all of our future landfill cells. Again Mayhill
Road right here
running north to south. The substation site as it exists
today is proposed for
this area right here. So you can see that number one that's
going to cut out a bit
of our access road, our entrance here. It's also going to
essentially remove the
home chemical collection building. So it would definitely
have that impact on
operations. These little red ridges here that ripple all
the way to the top, what
that is, that is our slope of the future landfill cells
kind of at final cover.
So the impact of having the substation at this location
would be that we would
essentially lose the use of almost two full cells and then
you would also have
because of drainage requirements a ripple effect that would
impact as many
as two or three other cells as well. As we identified that
we felt like that's
something worth discussion with the board as well as the
council is what is
the impact going to be on this. From a solid waste
perspective DME paid solid
waste about $775,000. That was for the home chemical
collection building as well as the land that surrounds it.
The impact to the
airspace which is essentially the asset that is most
valuable to a landfill that
allows for future waste capacity. We'd be losing about 3.3
million cubic yards in
airspace. In effect we would be losing about nine or more
years worth of
effective capacity. Now again reminder that we were
shooting for 50 plus years
so we'd be losing about 20% of what we're trying to get in
the new permit. The
financial value if you want to put a number to that it's
about 53 million
dollars would be the value of the airspace lost if we value
that at about
$16 per cubic yard. Some of the operational impacts that I
mentioned the
new entrance or the entrance road again if you kind of come
back here this road
was going to be taking out. There was actually a capital
project already
underway to construct a new entrance road. Whenever we
identified this that
project was too far along for us to put the brakes on it it
would in essence
cost us more to stop and restore things to the way they
were. So if you drive by
our site now you'll see that road is almost finished in
terms of
construction. In terms of displacing the home chemical
collection operation there
was also a project on our books for about four to five
million dollars for a
new building. We've since pulled that out of our capital
plan. Regardless of
direction today we feel like we have some other
alternatives that we can
explore but there would be additional expense for solid
waste to basically
bring a building up to operational standards for the HCC.
So ultimately just
from an overview we feel like from a solid waste
perspective this is worth
exploring alternative sites or alternative solutions. I'm
going to turn
it over to DME. Number one I want to thank them for kind of
working through
this with us. This has not been a pleasant experience for
anyone involved
and ultimately they've had a lot of work that have led up
to this point. We're
operating under the assumption that this was not going to
have the impact that is
having. So I appreciate their partnership and before I step
down are there any
questions from a solid waste perspective?
Questions? Can you put the one with the the tier back up
there please? So
basically taking out the southwest corner as you say has a
ripple effect
upon all those tiers and so that's really the impact. I
mean it doesn't
because we have buildings where those other cells are going
to be. I assume those
are going away or yeah go away under new permit. We haven't
decided in terms
of phasing or the kind of the approach that we'll have in
terms of cell
development. I'll use kind of this visual is what we will
likely do is start with
something like 8a whenever we get into these cells. Now
this is going to be in
the 2030 time frame mind you if we continue with our
current level of
growth and then we would start wrapping around again I lost
my mouse but you
would wrap from 8a to 9a to 10a and then come back around
to where the last
cells that you're filling are the ones that we would have
to remove existing
structures. You know one of the things when we talked to DM
E was well how long
does a substation really want to be there? Well it's it's
kind of a permanent
fixture once you put it in you may replace some of the
components but you
certainly don't want to be taking a substation out. So even
if that's 50 60
years down the road that's still not the the best decision
was my understanding
from them.
So the picture with the contours on it is it so it's one it
will eventually be
one gigantic mound is that the deal? You develop the cells
individually and then
as you have slopes you can kind of infill in between those
as more cells
are developed. Is that what we're doing with the stuff just
to the south too?
Eventually that's the case. That'll be one giant mound. One
of the cells that
we're currently developing is actually in the middle of
surrounding cells so
you kind of build the border if you will around that and
then you fill in in the
middle. I guess I'm confused why we would start using this
in 2030 if we really
haven't done the infills or bringing it up to the new level
that we've requested
for that. That's correct and that 2030 is actually when we
start finishing
out the cells that we're currently in. And they'll be at
their new the new
requested level that we asked? That's something that's to
be decided Mr.
Carroll I mean that's something that we would certainly
come back to the board
and the council on is do we want to max out our height on
our existing cells or
do we want to have new development and kind of wrap around
first. There's two
schools of thought on that number one is you want to go as
high as you can as
fast as you can. There's also the school of thought that
construction is never
going to be cheaper than it is today so why not go ahead
and start developing
those cells and then we can grab that height later on. And
so I think that's
something that's worthy of discussion with both the board
and the council as
we progress. I guess what I'm kind of getting at is if we
don't really have a
clear plan mapped out with what we're gonna do with what we
have then we may
get into a situation like we're in now where we planned on
doing something and
spent money doing it or getting ready to do it and then we
can't actually do that.
So how can we really actually make a plan for that subst
ation even somewhere else
if we really don't know what we're gonna do with the
landfill? Well I think what
we have here in terms of these cells developed I think how
we get there is
not determined yet the sequence or how we go about
constructing these cells and
using them is not completely determined but from a permit
standpoint we've looked
at this and this is basically where those cells would have
to be. I think the
real decision is how do we sequence those up and do we
actually end up using
them or not? Or really the only decisions that we don't
have made yet.
Does that help? Sort of. I guess what I guess what if we've
did you say 2013, 2014?
2013 is when the public input process I believe for DME
brought it away.
And I don't know so here we are it's 2018 and we're
starting over again kind
of with selection for that location and that doesn't really
doesn't give me any
confidence that we have any idea what we're doing so I can
't imagine it
really would give anybody else who's actually you know
spending the money or
doing the work or bidding the jobs or responding to our
requests for proposals
that we know what we're doing. I'm sorry. It was more of a
comment. I'm just
surprised that we're having to redo something that's been
on the books for
five years for something as simple as oh it can't go there
because we were
already planned on using it. That seems like a to me. I
understand the
frustration and we're frustrated as well. I think that what
we're trying to bring
to you is our best analysis of the issue at this point in
time and really from
our standpoint it really shouldn't be on any part of the
landfill site because
of these issues that Ethan's bringing up and when they
would be developed that
would be our recommendation for you. We're gonna give you
some of those
options of where it can go and how we would get there but I
understand the
frustration we're just trying to give you the best analysis
of where we are
today and the issues that are involved. Well so how are we
gonna build our
confidence about how we're gonna move forward tomorrow? I
mean if we spend time
talking about it and having public hearings about it and
then we really do
how are we gonna have confidence that what we're deciding
and what we're doing
is actually what's gonna happen and it's gonna happen in a
timely manner. How do
we do that? Yeah it's a good question. I think the way we
do it is to provide you
all the information to be very transparent about what the
issues are to
make sure we show you the maps of where the landfill could
be, the locations that
are out there and the pros and cons of each site. I agree
that that it's a
challenge of how it was done in the past but we want to
really reset that
conversation show you where we are today and try to move us
forward. That's the
only way I know how to do it. Okay okay but by saying what
you just said you
suggest in 2013 we didn't do all those things. I'm saying
that yes that we
didn't have a good analysis of the site that's correct.
Okay thank you. Sorry I
didn't mean to make it tense. I think the you know I think
the lesson learned here
is you know we just the landfill part anytime we look at
the going forward any
any using any of that it's it's it's such a long-term
effect that the dollars
really add up the impact whenever you you know it's only 14
acres or somewhere
around there 14.7 but that the impact is huge from a from a
from an economic
standpoint so if anything that's that's kind of what I take
out of this. Yes. Yeah
I would just like to say just in response to what what
Brandon was saying
and the presentation that we're watching to me my
perspective is that this is
another situation where y'all are trying to mitigate damage
that was done in the
past that you know we can't go back in time but I really
appreciate the the
efforts to you know not only assess the situation but also
to be transparent
about it and in being transparent we can show okay there
are sunken costs that we
can't get back but also that that's no reason to and I'm
just confirming what
the suggestion is here that there that's no reason to just
keep throwing more
money at it right so we can save as I think you say later
on in the
presentation you know ten million dollars by not you know
continuing to
throw money at these at these sunken costs so I kind of as
far as
confidence goes just as far as my own perspective is
concerned you know I to
me this gives me confidence I mean it's not happy but but
it's for me it's
positive to see the transparency the effort to mitigate the
past damage you
know one thing that I would like to see more about and this
wouldn't involve my
own input into the you know directive that I would want to
give today and it's
not because I don't trust it but I'm just curious about
what you were saying
about the new entrance road how you know there was that sun
ken cause but you're
at the but it's at the point now where it would cost more
to pull out of it
then to keep going and I I trust that I'm just here I would
be just curious to
see I don't know maybe in a in an email or on the appendix
to the next agenda
you know some whatever work you all did to look at to
compare to compare the
cost of right pulling out versus going ahead again I trust
it I'm just
curious sure but anyway and get something together great
but I do I do
appreciate that and just for what it's worth from my own
perspective it it gives
me confidence to see that we're doing this and you know we
've seen this before
with other operations in solid waste and decisions that
were made in the past so
anyway that's all well there's no other questions for solid
waste I'd like to
invite Brent to the podium and I'll let him take it from
here thanks Brent
thanks Jason appreciate that good morning chairman Robinson
public utilities board
I'm Brent Heath executive manager for energy delivery based
upon the
information that we just heard about this expansion permit
that has changed
some of the criteria for the site that was selected it was
kind of using a
Star Wars saga slogan a long long time ago in a galaxy far
far away but it's no
reason to continue down that path if that's not the right
way to go so Ethan
did a great job giving a brief recap of how we got here
back starting in 2013
with a public open house we had a 2015 public open house in
January 2016
council went ahead and selected the site and then in June
of 2016 council agreed
to go ahead and fund the site with a fund transfer from DME
to solid waste so
that three-quarters of a million dollars that was
transferred if this public
utilities board and the City Council agrees that another
site needs to be
picked or different option picked then that would be refund
ed back to DME and
one thing I do want to mention you talked about the 14
acres chairman
Robinson the substation site the six point two seven acres
you see here would
be the site that we're potentially talking about abandoning
but the
remainder of that acreage the easements for the
transmission letter still be
required and I'll go through that here in just a moment was
that included in
this price here this is just the same right the one point
two million dollars
included the other acreage for the easements there's a
couple reasons that
we needed the project for the substation and also the
transmission line there's
both primary and secondary reasons one is for the
additional diversity and
capacity of the transmission line through Denton and I'll
show some slides
and maps here in a moment we can talk about that also the
substation was
planned for future load growth for customer and citizen
needs out there on
the distribution system so we looked at some alternative
projects when we found
that the existing site was probably not the best solution
long term for the City
of Denton overall we were presented with five other
possible sites that we looked
at we researched and after doing that those are all in the
landfill none of
those appeared to be near as viable but on an economic and
operational
perspective is what had been selected so I think based on
information that we all
had at the city earlier the previous site was the best site
and actually
still is the best site for how it was intended however we
do want to go ahead
and be a team player so we've come up with a transmission
line alternative
that we'd like to present of how we want to move forward
and that will go ahead
and help us mitigate some high loading concerns that we
presently have on the
transmission system between the Paukris and Brinker subst
ations and the ten
million dollars for the substation cost would actually not
be needed at this
time we would hope that in the future as the needs arise
that that would be a
deferred cost that we could spend if that's needed in the
future so this is a
system map a one-line map of the city of Denton's
electrical transmission system
you're noticing the bottom left-hand corners are Denton
West substation that
is where the only 345 kv source the strongest source coming
into Denton
arrives into the Denton area get this mouse here that okay
right here the
Denton West station from this spot the southwest corner to
get up to the
northeast corner of the system the Arco substation there's
two ways to really
get there one is a northern route through the Jim Crystal
Denton North
area around Arco to get to Arco there's also a southern
route to come around to
get to Arco both of those routes are needed when the source
comes into
Denton West substation it's split between both of those
routes if there
is any switching going on or contingency cases where a line
is out of service
only one of those lines is is going to be loaded more than
normal so the one
that we're talking about today is the Denton West on the
southern route
around up to Spencer interchange and around Arco and the
reason Arco is
important to get the strong source through Denton is it a
lot of it goes
out eastward to Collin County and so there's two ways to
serve not only the
load in Denton but also the load outside of Denton through
the ERCOT Texas wide
statewide transmission system you may note there's double
lines a green line a
red line a blue and a red there's two different lines all
the way around
through the Fort Worth Teasley on around to the Pokra subst
ation area from Pokra
substation up to Spencer interchange there's only one line
and that's pretty
descriptive because all these two lines through here are
what we call bundled
conductor it's two different conductors two different wires
tied together per
phase it's been reconducted with higher
impacity conductor to carry more current presently between
pockress and Spencer
this one section of line right here is the section of line
that has been
identified as being overloaded as far as under certain
contingency conditions now
we have done some temporary fixes to where encore TXU used
to come out of
Spencer interchange and come back down to then head south
we have moved that
point of interconnection that demarcation point from
Spencer interchange
through some of our substation work southeastward down to
see this mouse
down to pockress and what that has done is that has
actually alleviated some of
that concern due to the encore TXU load and so we had the
capability which we
took it was an option and we took it where we tied the two
different sets of
conductors together and kind of made them a bundled
conductor and so that has
helped us in this interim period but it has not been recond
ucted it doesn't have
the high impacity conductor and so we were looking for some
alternate routes
to help improve that situation and provide the diversity
that I mentioned
earlier so all wouldn't be on one path there's a lot of
words for one map
here's two more maps maybe they won't be as many words this
time the item on the
left the image on the left is zoomed in between pockress
substation and Spencer
shows that one red line that we just talked about the
original plan it was to
come out of pockress find a different route a diversified
route around this
direction by the landfill have Mayhill substation and go
from Mayhill back to
Brinker and the Spencer interchange complex so this was the
original
proposed route it would have solved the situation that I
mentioned earlier the
alternate route that we're proposing today over in the
right hand side it
looks essentially the same with the same route for the
transmission system
between pockress over to Brinker but it does not have the
Mayhill substation
here so we are proposing to still utilize the remainder eas
ements for the
transmission line along the landfill not put the substation
there free up the
space for the future expanded cell development but still
mitigate the
transmission concerns and the loading conditions that we
have so that's what's
being proposed is the transmission only approach at this
time so the next steps
if the board and the public utility City Council agrees is
to go ahead
and complete the design and the easement acquisition for
the new transmission only
solution there is one segment that has not been acquired
yet for that and that's
needed in any of these cases and that's for these along
Spencer Road and we're
proposing to mitigate and integrate that into the mobility
plan for the street at
Spencer and so that has not been acquired at this time and
so we propose
to complete that design continue acquiring all that working
on
establishing that entire route we have feature
considerations that will perform
a route study for maybe for a possible future transmission
line between our co
and pockress and let me go back a map here pockress is down
here we're going
to go ahead and build this transmission line that's what's
being proposed but we
also have identified in some of the FERC 715 transmission
studies that we've done
as a matter of fact we just submitted another annual report
on April 1st of
this year they're always do April 1st and we need to look
at how do we get
from pockress substation somehow potentially in the future
up to our co
substation on the far eastern portion of Denton and what
that does is it would
mitigate the concerns here it'd mitigate all this it takes
all of these different
transmission lines into account and we would have a
straight path from the
southern portion from Denton West to pockress all the way
around our co to
head out east over toward the Collin County area and so
that would be
something that we would begin investigating we we have no
plans there's
there's not urgent in any form or fashion is just something
that we would
like to be in the process on looking at that and so that
would be a future
consideration between our co and pockress and then we will
continue to
research possible substation sites whether it ends up being
maybe on the
east edge along this route once it's been defined and
established and public
involvement meetings have happened and the citizens help us
pick a route we'd
look for a new substation site that could serve future
citizen and customer
loads and so that's the proposal in front of you today is
to help the city
and solid waste with the expansion permit the potential
loss of cell space
in future years but we have an immediate approach that we
can save and defer ten
million dollars and allow the land to be utilized for
future landfill space and
still mitigate the transmission line portions at this time
so that's all that
I have it's it's a lot of information I know it's kind of
overwhelming it's a
little disappointing that we're at this point from where we
began but we are and
we do want to try to rectify and find good solutions moving
forward I know that
George and Ethan and Chuck and I would be happy to answer
any questions that
you have about the landfill or the electric aspects of this
proposal to move
forward with the transmission only approach yes so I
applaud the
transmission only approach it sounds like a good solution
and as I said
before this sounds like a good way to mitigate some
unfortunate you know
sunken cost from the past that can't be corrected I'm still
not clear about as
far as kind of future you know where to put the substation
in the future I'm
still not clear about the need for that substation in the
first place and
whether it's about growth here in Denton in that area which
I don't quite see in
that specific in that area or if it's about the generation
coming from the
new from the new the new gas plant and the effect of that
on on the transmission
load so if you could say something about that and and I'll
just add kind of throw
in there you know also kind of thinking back to as far as
you know decisions
made in the past that that can't be changed you know I I
think about the
relation of some of these substations to the gas plant and
you know it looks to
me that these certain decisions were made with the gas
plant in mind before
the public knew about the gas plant and that was by I mean
the people who could
answer to that you know many of them aren't aren't here to
answer for that
but I just wanted to note that just so in case the public
is kind of scratching
their heads at home thinking wait but we didn't know there
was gonna be a gas
plant then anyway but if you could explain for for us and
you know and also
for the public you know how much of this had to do has to
do with the load in the
area for Denton and how much has to do with what we're
gonna be generating okay
thank you those are very good questions I can assure you
that the substation may
whole substation when it was planned in 2013 was prior to
any discussions
beginning about the gas gas plant so it didn't have any
relation to that it only
has to do with the transmission line loading that we have
identified through
the FERC 715 studies so the the reason for the substation
versus the
transmission system is it does allow the substation allows
for future load growth
customer growth in that area there is undeveloped vacant
area over in that
eastern southeastern portion of town we do serve some
critical loads such as
the hospital the wastewater treatment plant and I see PS
smiling about that
and and FEMA has enough regional call center there and so
the substation is
for that as well as all the other undeveloped areas so that
's why we can
not that's why we can get by without using the substation
now because we
presently serve all of those items it would just add a
diversification and
enhanced reliability but as new growth comes on we will
need to look at another
possible future site but that may be decades down the road
yeah thank you
thanks that helps a lot you answered my question on the
hospital load so it's
it's fine today but we may need a substation over there if
there's more
load growth in that area that is correct okay so this you
know that the area that's
just north of like along pockress and north or east or
whatever it is of like
we're post oak and all that is that is that a service area
as well or is that
on we do serve this area around the pockress substation
there are you get in
some areas when you get on the fringe areas there may be
some dual certified
areas with other utilities but all of this is in the single
certified and
that's that's been a high growth area yes a lot of a lot of
growth going on
there yes you know it's interesting I guess the other thing
too on the I notice
that were a lot of this ties back to the Urquhart
reliability from the from the
West coming in and I just wonder if that has a lot to do
with the increase in the
in the wind power that's coming from the West we do we do
receive a lot of
congestion to have better transmission for that yes sir you
're entirely correct
we are seeing more wind energy coming from West Texas area
into the Denton
West substation from TXU and Encore and that does have to
not only serve loads
here in the Denton area but also east of here sure yes so
you mentioned in your
presentation that to move forward with the alternate plan
we'll have to do some
easement acquisitions did we begin easement acquisitions
for the original
plan we have all the easement acquisitions we need for the
original
plan except one small section okay and so just by looking
at the map I mean it
looks like maybe it's only in a different place so that we
can see it on
the map you're not real are you really moving it to the
east the transmission
line would stay in the original location is playing so you
really so we really
only have one more property then to look at even for the
alternate plan yes and
we have a possible route forward for that with with the
city mobility plan
okay do you have an idea and I guess it won't really impact
the type of support
structures used or the number of support structures really
either will it there
actually could be a reduction in some of the transmission
poles by not having
have a redundant path with this new proposed transmission
only route kind of
sounds counterintuitive but the way that it was configured
there's some possible
reductions and I'll take your word for it yes can you
describe the support
structures are they the big it'd be the rector set looking
things or are they
big giant metal it'd be the still mono poles single pole
structures with the
base size of those ones that are like this the ones that
are like it would be
the ones that you've been seeing installed around town
all right thank you so yes ready I have a question
because I've confused myself are you saying that the
alternate plan solves
the Mayhill landfill problem the alternate path the
alternate plan with
the transmission only removes the Mayhill substation it's
not on this plan
and that is the portion that is in question for cell
development the
transmission easements by the landfill they all still
remain in place and so by
just not putting the substation there and redoing part of
the transmission work
where we don't have the double circuit that I just talked
to with about Brent
about reducing poles we can still accomplish the
transmission loading and
help with landfill cell use with this expansion permit and
save ten million
dollars save ten million dollars today with a possible
deferred need in the
future yes so then how much more planning relative to May
hill needs to be
done if this gets approved what we'll be looking at the
procure in this portion
of the transmission route right here that we don't have and
then we will
begin at some point getting from pockress up to Arco which
we've not done
anything at all and that'll just be some preliminary
preliminary
investigations that is long term I my question was really
about the landfill
itself in terms of doing all this research and coming up
with alternate
plans if this is done then what's the next going back to
the original
presentation then what happens or needs to be done or
looked at well I think for
us again these cells are what's currently in our permit so
if the
substation does go in we probably have to go back and
remove some of this it's
always easier to go to the TCEQ and say we don't need
landfill development than
it is to ask for additional but essentially we would move
forward with
the permit as is I think the next step to answer your
question and maybe circle
back to mr. Carroll's earlier is we do need to do a master
plan for solid waste
we wanted to make sure we understood where the substation
was or was not
going to be before we proceeded with that but we do need to
give back and
start kind of understanding how are we going to sequence
this bring that back
to the pub as well as the City Council for your input as
well but understand
that these cells right here this is already part of the
permit so we really
don't need to change anything if the pub recommends us for
moving forward to the
council so yes thank you I have a question about the cost
of so the
the acreage that was purchased from and I'm not sure if
this is a DME or solid waste
I can see you're both standing there it's about the acreage
that was
purchased by DME from solid waste for the $774,682 is it is
that in any way
refundable since that's from that within the city that's
all fund balance
internal budget transfer that would just be the area shown
here in the magenta
the purple that's where the substations at that would be
the section this
775,000 that would just be a fun transfer back to DME where
it came from
yes over to solid waste okay okay good good so that's
something that the rate
payers can see that that's not part of the the sunken cost
right no that that
funding is available whichever side of the city yeah
absolutely yep okay thank
you I was just kind of mentioned in that same conversation
that would need to come
back to the PB for approval and then to the City Council
that we'd bring that
back so you would see that okay just when this is kind of
off-the-wall
question did we consider possibility of a gas insulated
solution to this that
was discussed yes I mean that that is you know has two to
two and a half times
the cost sure and whether it goes on this site which we'd
still would not
want to put it on this site after knowing what we know
about the expansion permit
but considering other sites the alternatives I'm just
thinking about
alternative sites in the future if it gets you know if we
're crowding in to
something it's it's something to look at right I understand
it's more expensive
but sometimes you have to do that so okay I wonder if we
can add like we have
in the past we've added an analysis for GIS to every subst
ation I wonder if we
can add this analysis that I guess we didn't do in 2013
about a
transmission only possibility is that possible that we can
now use do that in
the future for every facility instead of doing it five
years later and retro
right yeah back in 2013 when we began this process we were
so far behind the
eight ball in the transmission system from the very first
first 715 studies we
did in 2011 and of course we had our all-time system peak
load it just jumped
like we have never seen before and so we didn't have any
time to waste and we
didn't want to get not only have the pendulum swing from
being very far
behind to exactly meeting today's needs but why would you
not want to look at
what could we do ahead of that to plan for the future and
so we did look at
planning for the future and that's why we proposed the May
hill substation it
looked like it was a good alternative it was on the new
transmission line route
we wanted to incorporate that but yes we can look at the
scenario do we have to
have it now or can it be deferred to the future and I know
the landfill that the
changes in what we're doing with the landfill is what
precipitated the need
to evaluate moving this or do you believe that we're gonna
see any of this
kind of stuff with other proposed approved substations that
haven't been
built yet for instance like the Eagle what is it Eagle and
Eagle substation
yeah I mean because we kind of had a lot of public hearing
a lot of stuff and we
picked a side and nothing's been done are we gonna reeval
uate that one too do
you think I don't see that that that's actually the same
has the same aspects
involved this is city-owned land and so it was solid wast
eland it was designated
through a lot of governmental and public involvement
meetings as a substation
site the Eagle substation site that you mentioned has been
selected and we're in
the procurement process for that it would be city site and
so we're proposing
the GIS station for that it's needed for the University of
North Texas in the
surrounding area and there aren't any other sites or other
possibilities of
how we pick up transmission loading and customer loading
our general manager
George Morrow may want to speak about that okay certainly
George Morrow DME
general manager just want to make a general statement you
know we're
relooking at our entire expansion plan for the T&D system I
've not found
anything that's not necessary or needed but the question is
what timeframes and
so we may be pushing out some of the timeframes trying to
smooth our
financial impacts repair cost impacts of some of this stuff
I mean there was a
lot of synergies at one time we were moving forward with as
Brent mentioned
just a ton of expansion why not get it way ahead of the of
the need but we may
be coming back at some point and saying we're gonna smooth
some of this stuff
out and but nothing that's on the drawing board at this
point is we're not
saying that's not needed so you know the others are still
part of the plan sure
you can stay there one of the things that it does for me is
as I when I came
on the PUB and y'all started showing me these maps and the
high voltage lines
and how they run and we start proposing these things well
people from this the
public start coming they say were you really not supposed
to put a substation
right here in the middle of the city you know it's you know
this the one that
worked that you just were referencing is right there on
Eagle Drive there's
there's big tall buildings around part of it and this
university and student
housing and things like that and people are saying well
sometimes people will
locate those to the outs on the edges of town and bring
them in with a high
voltage transmission line and you guys actually not you
personally but it was
kind of the consensus of staff was no we really don't do
that here we put them
we're gonna put it here because that high transmission line
doesn't really
work like that and now kind of what we're seeing is
actually you could do
something like that and locate that substation in a
different area instead
of right there and bring that power in with a high
transmission line so I'm now
seeing something new a new way we could approach doing
something that I thought
really wasn't how we approach doing things just yes and no
we're getting a
little bit off the posting by getting into overall stuff
and I know it's well
that's I know but we're still posted a subject so we got to
stick to that it's
not a wide open if we want to do a work session is this the
first time you've
ever seen this high transmission line solution I'm just
trying to learn about
it no I agree and maybe we need a work session on on what
George said what is
our what is our overall capital improvement program and how
do we go
forward with that and it may include more and I don't want
to keep she
actually asked for that yes Deb asked for that and what we
got it was in a
memo in the in this ACM update we didn't actually get any
kind of information we
got something that we got to read and nobody actually got
up in front of us
and addressed it she asked for it yeah so she may have
approached him and met
him later and got more information but we never really got
much information well
we do we do intend to come back if I could jump in just
quickly we do intend
to come back at some point as we you know as I get my arm
around all the
pieces and we have additional dialogue internally about you
know what impacts
will there be to the TND plan that you've sort of adopted
and seen before
what smoothing are we going to be doing you know what time
frames so we'll be
back I think this solution is not going to be one that's
adaptable in too many
other if any locations you've got to have substations to
serve customers you
know you can't serve them off the transmission line so the
substations
allow you to drop down the voltage to distribution voltage
to serve customers
and customers turn out that they're in the center of most
urban areas they're
not on the fringes and so we really need to put the subst
ations unfortunately
because there's some impact in areas where we have the high
load and where we
have customers so I've struggled with that my whole career
it's tough and it's
tricky to have to drill and put that substation in an
existing residential
area but sometimes you know it couldn't have been predicted
20 or 25 years ago
exactly how that growth was going to come and so we have to
we have to
shoehorn them in there and unfortunately for for that but
we can't serve local
center of town customers from the edges I guess simply put
you just said you're
struggling putting together all the pieces and we'd count
on you to put
together the pieces to give them to us and we're struggling
to put together the
pieces too and if you are I'm not struggling I'm not really
not struggling
but I'm you said I was just saying what you said right okay
I'll pick a better
word okay I'm very casual sometimes with my language yeah
so we're working
through that I'm working through that with the staff there
's a lot of pieces
and moving parts want to be really sure about how if I'm
gonna make any
adjustments going forward I want to be very certain of the
impact of those
things and sometimes the leg bones connected to the
different parts that you
didn't you didn't realize when you when you start moving
things around so yeah
well I will I will say in light of we discovered today
there was a new
solution to these type of things that we I would like to
see a work session
dedicated to capital improvements and the FERC report yes
if we can okay I'm
sorry no I just wanted to add that actually that Brandon's
question I had
the same exact question that I was going to ask so I
appreciate that question
and I do think that it's it's relevant and I do think you
know if there's one
I mean there are a number of lessons to you know to be to
be learned from all
this but but I think that one is a lesson for the future is
to really think
about you know how much in terms of building out for the
growth can can we
defer and safely defer into the future because the the you
know the O and R
costs you know for instance if we build a substation now
you know even if this
wasn't a problem with the location right you know if we say
this wasn't an issue
with the landfill still you know if it wasn't needed you
know in the immediate
future so so that's just something that it's something I've
always wondered
about you know why the this why we had the timeline that we
did for building
out our you know our substations for the growth and from
you know the amateur
research I've done it seems that you know that the standard
practice is to
really wait until you know that it's going to be a need in
the relative
immediate future you don't want to wait too long right
gonna make sure you have
a site so you've got to get the site ahead of the need and
and as you defer
in the future costs go up right new construction costs
escalate costs
increase so that kept those two things way together I think
as Brent said when
he started this whole discussion that and I concur 100% the
substation is
still a good project for us at that landfill site it just
gives some extra
flexibility but it might be something we don't need till 15
or 20 years down the
road it gives us some enhanced reliability we can do some
switching of
circuits to improve performance in an area if some things
we didn't plan for
happen you know that circuit goes out unexpectedly we have
a little bit
additional flexibility so there's some value to that and so
I think the staff
was trying to program in that value early and in return the
substation would
be there if and when the growth would come to that area so
I know it's a
little bit complicated so I think the substation you know
when you look at it
really hard for the you know the next let's say two decades
I think Brent
mentioned that probably not a critical urgent need but at
some point in time
something probably we would need to do out there and and we
'll be looking at
that in the future thank you okay any other comments or
questions so I guess
the direction you need direction from the PB on I mean your
plan is presented
to we don't need actually need to have a vote on it it's
not a voting item but if
there's a direction I guess I like the new proposal myself
okay yeah I feel I'm
hearing yes to the transmission only option and yes to
deferring discussion
of the future substation placement okay thank you very much
appreciate your time
okay next next in the work session we have item B which is
to receive a report
hold a discussion and provide staff direction regarding an
update to the
existing municipal electric energy risk management policy
George Morrill DMA
general manager again you may recall early in my tenure I
said I would be
back to talk about our energy risk management policy and
that's what I'm
here for today the original policy the policy that we
operate under today was
adopted back in 2014 about six months ahead of us taking
over our and
establishing our own trading operation at DME and you know
through that three or
four year period things have changed the organization's
changed the markets have
changed we've learned some things and so it made sense to
to update the policy
and we had Deloitte who did a very nice job you remember
the presentation from
Deloitte late last year they had a lot of great ideas for
us and many of which
and most of which we agreed with and we wanted to
incorporate into an updated
policy so policies needed of course because it provides a
framework and
guidelines for the energy management trading organization
at DME there
provide some checks and balances it gives some like I said
some structure to
what we're doing in the markets and it also allows us to it
gives us some
direction on reporting back to the council the PUB
internally what is what
what would the framework be for this for this for policy
decisions so real time
here's just a little bit of what we do out there real time
we're buying and
selling selling power where we're balancing our resources
to match our
loads and we're looking forward and trying to make sure we
have enough
resources during periods and making decisions about hey if
we're short you
know do we need to buy something when that you know when
the markets are
supportive of doing that in the longer term we're trying to
look at the big
picture integrating a lot of these new renewables that we
have that's going to
require a little bit different paradigm for us managing the
partners that we're
buying and selling to making sure they're adequately
collateralized and so
forth and so that's those are the two time frames for for
the risk management
policy so there's three pieces to the Emo we have front
office middle office
back office front office is doing the real-time trading and
the near red time
real-time type transactional efforts the middle office a
little bit like the
traffic cop it's checks and balances risk control it's an
independent as
standalone type operation looking at what we're doing and
why we're doing it
and making sure that we have business relationships that
are sound with other
parties to do it then the back office is taking care of our
contract
administration paying bills making sure we have funds and
so forth for that this
is a little bit of what it looks like and have a few of
those folks here today I
wanted to introduce in the back office we have Michael
Wilson who's our
settlements and rate administrator so he's taking care of
all the you know the
calculations to make sure that we're being billed correctly
by all the
counterparties and by aircott in the front office we have
Stephen Johnson
who's our market operations manager he manages all the real
-time around-the-clock
folks that are keeping an eye on things and balancing our
load and the we have
Smith day who oversees the middle office and our senior
risk control analyst Phil
Deepestina he's here and Phil's going to take over a little
bit of this
presentation there's some nuts and bolts that I wanted him
to go through but I
wanted to talk about him a little bit because I was a bit
surprised to find
him on our staff Phil has a lot of experience he's got over
35 years in
risk management for electric utilities he set up managed
the front middle and
back office at Pacific gas and electric at a time when PG&E
was the largest
electric utility in the country and I'm like pretty amazed
to find he's here
with us he also set up an enterprise wide risk management
program at aircott
he set that up and managed that for a number of years and
so decided to come
to DME and he's he's our traffic cop that I mentioned
earlier so he's has
that kind of background and so we're he's here to kind of
take over Phil if
you want to come up and he's going to talk specifically
about the Deloitte
recommendations we tried to integrate as much of the Delo
itte recommendations
as possible into the energy risk management policy now that
we could but
it's really a two-part process for us and we have some high
priority low
hanging fruit that is before you today that we've
integrated and then we'll be
moving forward to do a little more work on some of the
middle or lower priority
items going forward and I perceive even a further dialogue
with the public
utility board about what I'm calling risk appetite you know
how much you know
what should be our risk profile here as a publicly owned
community owned utility
and that's an area that we want to share some things with
you and get your input
at a later date so Phil if you want to come up and I
dragged him out of the
comfort of his office to do this so hope he hope he doesn't
mind hi I'm Philip
de Pastina senior risk control analyst for DME and as
George mentioned we're
bringing to you a draft of the risk policy which we've
updated I'd like to
go over a few of the kind of the highlights first of what
what's different
about this this version one of the things we've done is we
've streamlined it
the first section and provided some clarification of what
the why we have it
in the first place what the program goals are which are to
use the Emo to
help integrate the renewable resources through short-term
market transactions
and to minimize the risk of in doing that of affecting the
rate payer risks
the rate payer rates adversely the second thing we're doing
is we're
consolidating what we formerly had two risk committees we
're consolidating them
into one single risk oversight committee we're also
highlighting the fact that we
need a number of counterparties to diversify our the risk
that goes with
dealing with them and to ensure that we're getting the
competitive market
price when we buy or sell electricity one of the
recommendations we received
from Deloitte was that we needed to improve the quality and
frequency of our
communication with the pub and the City Council so we're
incorporating changes
in that risk policy to do that also we were it was a
suggestion that we provide
more specificity in our risk limits and how we control the
the kind of deals
that we the emo does as well as additional detail on the
types of
transactions that they can do and so we've incorporated
those things in the
this new risk policy in addition to the policy itself that
we've included in
your package we summarized the recommendations that Delo
itte brought to
you I think it was on December 11th they had a number of
recommendations about 60
that were broken into high medium and low priorities and we
've taken those and
and try to figure out where we can where we can address
those in our risk policy
and we've done that and this is just a graphic to show that
yes we're gonna
pull up the Deloitte matrix that was attached to the report
let's see how do
we have that's it how do we blow this up or do we okay as I
mentioned there's a
high medium and low priorities that Deloitte recommended
some of them I've
already discussed we've
reassess our the policy itself we've updated a number of
the of the policy
and we're in the process of updating procedure operating
procedures we've
consolidated the risk policy the risk oversight function
into a single
committee
medium priorities we've we're we've we're going to provide
the minutes of
our quarterly risk committee meetings to the council and
the pub so you can see
more of what's going on and and what the Emo is is doing we
've established a
clear set of guidelines for how the committees work and
established a more
formal oversight process the Deloitte recommended that we
institute some
processes for more formally transferring knowledge around
the Emo so that
everyone understands what the rules are who does what and
how things should
operate and then there's a number of low lower priority
items most of these will
be brought to you and incorporated in the risk policy and
what we're calling
phase two later in this year and that's where we're
developing reports and
actually asking for your approval of risk metric measures
and evaluate how how
we evaluate the performance of the Emo so I'm happy to go
into any of these
items if if you have questions about them
questions
scroll back to something that was a procedure rather than a
policy update
that you can just give us some details about how you change
the procedure and
what you did because a policy I know you we could just read
it and say oh well
that's how you changed it but have you implemented any
procedures based on the
recommendations from Deloitte that you want to share with
us the procedures are
being updated currently okay and we're kind of waiting
until we get the the
risk management committee meeting so we can go to them and
ask them for their
approval okay on these okay okay so the most of those
things that are phase two
right okay right okay
questions there's also a number of these recommendations
that will be implemented
not in the risk policy itself or in the operating
procedures but for example
we're going to bring to you a recommendation to purchase a
new energy
trading system a database that tracks things and generates
reports and as part
of that a lot of these recommendations we included in the
specifications that
we seek in that do any of the items cover business
continuity or disaster
recovery those types of things certainly that'll be part of
the disaster would
would include the risk management system going down and yes
there'll be
procedures on what to do when that happens we already have
that if for
example if communications fail in the Emo office we've got
procedures on where
we can go to to resume operations okay thank you would it
be fair to say the
first phase was setting up the governance and the policy so
that the
second phase you get more into the details is that right
there's as the
earlier slide mentioned it's the low-hanging fruit right
and the immediate
most high priority things which is refining the governance
process and
establishing more clear steps on how the risk oversight
committee works okay
question okay I'll just say I'm glad to know that we have
somebody in house I
didn't know that either with a risk management such a
strong mission
management background who can implement the Deloitte
recommendations and I think
if there weren't that many you know questions for you today
it's because we
got had the Deloitte presentation and we asked a lot of
questions then and they
were really helpful and it's good to know that there's
somebody on staff
implementing that and I would just say as far as I guess
you're not quite
asking for direction on this but you know I would recommend
and it seemed to
me that Deloitte the way that they were assessing the kind
of risk in doing a
kind of triage on what needed to be you know what was
considered a high high
risk and why I would recommend you know minimal you know
the most conservative
approach and minimal risk approach possible because because
we're dealing
with with public with public money and obviously there's no
such thing as a no
risk approach but you know to just minimize the risk I
think would be the
way to go and I feel like that's kind of how this was that
how the what was in
mind as these priorities were assessed by Deloitte. I was
going to highlight a
few things Philip thank you. Thanks Phil. You know I was
impressed myself Philip and
our other members of our energy management organization
worked with
enterprise risk consulting to update the policy so we had
their eye on it but I
you know we've tried to keep it understandable and readable
and you know
without a lot of industry cryptics and so forth and we're
trying to be
transparent with the policy so we're we're opening up this
energy risk
management policy at this point didn't find anything in
there from my viewpoint
that would cause us any risk from a from a you know a
transactional standpoint
you can see we've updated some of the exhibits that are
really key to what we
do you know what are the authorities internally what are
the limits
internally both for electric physical and financial
electric and as well as
for physical and financial gas we're gonna be doing more
gas transacting as
we move forward we're involved with that right now so and
we're gonna be coming
out with other things that I think will will touch on what
I just heard and
that's also my perspective from years of being in the the
power business is to you
know this is a community owned citizen owned repair owned
enterprise taking a
lot of risks and risk management are so critical I'm very
conservative from the
risk profile standpoint I suspect you are but we'll have
that conversation
again as I mentioned we come back to you and I'll hear
comments from everybody
along the lines of what you know what how much risk should
we take and
shouldn't take and I think because this has been a bit
black box up to this
point there's been a lot of folks thinking hey you know
what's really
going on in there how much risk are they taking what are
they doing what
transactions are they making and you know there's a very
very detailed report
that we look at internally every single day that documents
every single
transaction that marks the value of every single resource
that we have going
out several years I mean we do it every day based on market
conditions it's
Philippus manages that and there's just we're on top of it
we're watching it
very carefully and we're not predisposed and never have
been
predisposed from what I can tell to take a lot of risks in
that area in fact calm
and smooth it has really been the the guideline I think our
Emo staff has had
all along so it's just that it was hard to communicate and
hard to bring forward
in the paradigm that we were living in in the past so now
we're we've got a new
world we're want to be much more transparent and open and
communicative
and we want to get your input again as we come back so
Philip thank you for
your for the work that you've done to put this together I I
think we dealt
with a lot of what we heard from from Deloitte we've got
the the next phase
that was just talked about in particularly that first item
which is
you know making sure we're all comfortable with what we're
doing the
risks that we're taking and what's our risk tolerance and
you heard my
perspective a little bit but I don't run that you know it's
not my call it's your
call as the governance body for this agency and and we'll
talk more about how
we're going to communicate with you going forward to make
sure you get
information that you're comfortable with what we're doing
so we're back
probably in about September for the phase two we'll clean
up everything and
in between the time now and then we'll come in for some
more feedback from you
so that's our risk management policy if we get your support
we intend to come
back at a future meeting for formal approval we'll have our
kickoff meeting
of the new risk management committee and there's a lot of
work for that
committee to do going forward to educate themselves I think
the chair of the
PUB sits on that committee and it has a vote so look
forward to working with the
chair and and him communicating communicating back to you
with what's
going on
having a little bit of experience with drafting policies
and procedures and
with compliance in several industries I've seen this happen
a bunch of times
where an organization will go through the procedures to do
all this to write
all this they bind them and then they go on a shelf what do
you have planned as
far as implementing training or at least some kind of
acknowledgement from your
staff that they've actually read these policies and
procedures and are going to
follow them good point yeah one of the exhibits of the
policy is a sign-off
sheet by employees that says we we've read and we will
follow all the employees
involved in the energy management procurement and sales but
it's a living
document it can't sit on the shelf there's too much at
stake here there's
too many dollars at risk the the energy management side is
too large and so
these conversations and the interaction between the front
middle and back office
is happening many times a day there's there's just a lot of
oversight and
input I spend a lot of time looking at what we're doing and
why we're doing it
and so and we'll be communicating everything back to the
risk management
committee and there's some general city folks that will be
sitting on that
committee also that you know it will be all of us will be
managing that function
so it's a real thing I agree with you a hundred percent you
do the long-term
strategic plan everybody you know says yes yes yes and it
sits over there this
disk that cannot happen here and have you all invested in a
document management
system that will allow you to update the living document
and then let everybody
know that there have been changes published and that they
're responsible
for understanding them and knowing them and adhering to
them yeah if we make any
changes to the procedures and the policy everybody will get
a copy of those and
we'll have input into it internally but everyone will get a
final copy of that
and we do have document management system at DME there's
centralized files
for everything that we have and this will be there
available for anybody that
has that need but it won't be like we said we're not int
ending it to be black
box for anymore for this group and we don't it's not black
box for our people
either it's totally it's a living and breathing and it has
we have to live and
breathe it every day it's just too much at stake and it's
too important and you
know my review of the of the front office so that's the
folks involved in
the around-the-clock operation to match the resources with
our loads I've been
very impressed the resumes for that group are as impressive
as Phillips
resumes and we have a lot of folks that have experience at
aircott and other
large utilities and have come here that have you know might
have taken them a
little bit but they've kind of learned the public power
community-owned ethic
and they're as they sort of talk the same language that you
know I'd like to
talk and I think you would be talking about what we should
be doing and why
we're doing it and how we're doing it and what risk we're
taking or not taking
so thank you thank you since the new risk management
committee is it you know
crucial part of all this I was wondering if you could
explain both for us and for
the public who sits on that committee you know how the the
constitution of that
committee was decided and by Constitution I mean how it was
how it's
constituted and how that was decided what term limits are
etc yeah Philip do
you have anything you want to share on the committee itself
I had actually had
a slide on that I was gonna I don't know that we brought it
okay
let me just bring up the document here I don't think I can
bring up the policy
itself it's in the yeah oh here does this say no no
actually don't have the
policy Philip it's in the agenda so it's yeah well I don't
well it's in the it's
in the staff report but it's not part of the presentation
so one of the things I
you know I will chair that committee so we'll have the
deputy city manager we'll
have the we'll have the finance director or designee we
have the pub chair or
designee and and we'll have the gentleman in the back there
from legal
that will sit on that committee so that's kind of what I'm
used to so it's
basically those five folks they'll have votes and the other
committees that I've
chaired in the past are very similar I represent the
department basically and
then we have folks from outside the department so there's
plenty of oversight
and checks and balances we'll have a lot of staff members
attending those
meetings and being involved and presenting and here's what
the market
looks like here's our forward projections of what's
happening here's
the resources we're bringing online here's you know here's
the economics of
certain types of deals and try to and getting authority to
do some
transactions so did that answer any of your question
possibly didn't answer
everything yeah and and so this was the site so the makeup
of the committee is
decided internally and right in DME and will will the
meetings of that committee
be posted and open to the public no of course not yeah I
figured no because
setting you up for just to kind of explain you know also
for the public
I'm so honest that's I had to give you that no no no no no
no our intention is
okay I following the meetings something we're not doing
today we're gonna put
minutes together and you know I'm not sure how deep or how
much and we'll make
those available to the utility board in the council each
quarter you know
minimum quarterly meetings possibly meetings quite a bit
ahead of that I
actually have quite a few things in my mind lined up that I
want to get some
direction and input from that committee on so we'll be
going through a lot of
learning together and and providing the direction I think
the department needs
going forward so thank you for setting me up for that but
so they so the the
decisions of that committee will be you know presented you
know not only the
minutes but at some point yes but it's not an open
committee though yes under I
think that would not be a smart thing for us to do we're
still involved in the
committee you know everybody else we deal with there pretty
much our private
sector they have black boxes they're confidential we don't
know we don't know
what cards they have or what they're thinking or so you
know we do so we have
to be a little bit careful but some of the things there
will be reportings kind
of semi-annually to PUB and council providing quarterly
after the minutes
we'll be providing information about those but you know I
don't I don't know
that it'll be anything there that we would be that we
review as confidential
or would adverse us from a power marketing standpoint we
did make the
decision internally I think we had input from ERC I think
we had some input
possibly from Deloitte about the makeup it's totally up to
the PUB if you look
at that makeup that we have and you think that's not
appropriate that's what
these work sessions are for and you if you don't do it
today you can do it in
between like I say we'll be coming back at some point with
the document for
formal approval and I'd be open to hearing any thoughts now
or later from
the PUB on the committee makeup I see the makeup of the
committee is very
appropriate it's got all the right people at the table so
thank you very
much I'm glad to see it I'm glad to see how this is all
being put together and
that's being shared because I don't think any of this was
in place prior to
is that correct right we there was a different makeup there
were a couple of
different committees they were more internal than external
and this is a
whole new paradigm for us and I'm looking forward to it I
like to say we
want to be as transparent and open as possible and not
impacting our cost
benefits and that kind of thing Brian I just want to make
one other point I
think George and his staff done a good job taking a look at
this from a fresh
perspective with the new environment and then bringing
something back and it
really dawned on us too as we were going through this this
was approved in 2014
right I think it was originally and it wasn't brought back
on an annual basis
back to council or PUB so we want to have at least an
annual process to bring
it back and say here's where the policy is there any tweaks
we need to make to
it how's it working for you guys how's it working for us is
there anything that
we need to change and constantly keep that in front of both
the board and the
council because board members change council members change
staff changes
always really have this at the forefront so we can make
good decisions but I
think they've done a good job of taking a look at all that
and we'll bring this
back to you on a regular basis so it's you know unlocking
those mysteries of
what's going on really have a good transparent conversation
about what's
happening yeah and there actually has been a lot of updates
Philip had a
redline version for you at one time attached to the report
and it was just
there was so much red ink I just that didn't help so we we
didn't really
provide the red line because there is so much so many
changes in there but again
we tried to make it understandable and and for for lay
people not that you're
laypeople but in general for the public or others that
might want to look at it
and for our own staff that's it's a roadmap for us to
manage our risk well
we can we can still consider ourselves as like people that
's not but no you
know this is this is I like the structure because I think
it's gonna
provide excuse me better opportunity for communication to
the PAB and the council
and like you say there are certain competitive matters that
you don't want
you can't discuss but at least we can we can it's good to
know that everything
that's been done has been done correctly and the high
priority part of this is
that the governance and making sure that everybody knows
what's going on
everybody's informed and so I think again I'll echo Brian's
comments that
this is this is good I like them I like this thank you
thank you very much okay
anything else okay we have next part of the meeting we have
a consent agenda
with five items ABCD and E is there any member of the board
who would like to
pull any of these items for individual consideration yes I
would like to pull
D just because I'd like to hear more about that okay item D
it's been pulled
any other items D okay then item is there a motion then on
the consent
agenda for items ABC and E so moved we have a motion to
approve those four
items is there a second second second any further
discussion all in favor say
aye aye any opposed same sign okay item D which is consider
recommending
adoption of an ordinance authorizing the city manager to
surrender to Bloomfield
homes LP a certain irrevocable standby letter credit dated
November 12 2013
drawn on Texas Capital Bank in the amount of 176 thousand
one hundred forty
three dollars and ninety three cents in which Bloomfield
homes LP is the
applicant and the city of Denton is a beneficiary and
further partial
releasing Bloomfield homes from financial obligations
concerning the
construction of water and wastewater lines included in that
certain letter
agreement dated December 29 2000 by in between the city of
Denton and when
Jackson Lakes Development LP as a successor in interest in
providing
severability and an effective date
yeah I'm not sure whether you want me to give a
presentation or answer questions
so I'll leave that up to you okay quite some time ago
probably about 16 years
ago there was a freshwater supply district created the far
southwest side
of the city of Denton it straddled the Denton ETJ strip
annex that kind of
defined our boundary with Argyle and straddled in Dargile
they had used a
provision in state law known as annexation so it was an
annexed freshwater
supply district city of Denton never provided the approval
for that so they
filed lawsuit against the freshwater supply district to
challenge that that
resulted in a settlement agreement in that settlement
agreement there were
provisions made for zoning and there were provisions made
for providing water
and sewer extensions to serve that development there were
certain financial
obligations that the development had to make payment and in
that there were some
surcharges to the impact fees that created income to help
pay for those
water and sewer lines or proportion of them during that
time they had to file a
letter of credit which was their financial guarantee that
they'd make
payment each year during the course of the project some of
the momentum on it
stalled for a variety of reasons and so then they sold the
property when they
sold the property they sold it to Bloomberg Homes as one of
the larger
purchasers the city then required surrendered the letter of
credit from
the seller and required it of the buyer that buyer then you
know fulfilled those
obligations through the remainder of the bond period once
the bond period was
done the city no longer needed to maintain the letter of
credit since the
letter of credit was transferred to the new owner by
ordinance legal wanted us
to go through a ordinance to release it the original terms
of the agreement also
called for a refunding of the bond selling costs which is
usually your
payment guarantee through the course of the bonds which was
agreed to in that
letter agreement from 2000 plus the interest costs so we'll
also be
refunding that as well but we do need to make sure that we
give that to the right
parties or party rather because the legal obligations and
the benefits ran
with the properties that that help so it's it's the the
closure of a pretty
long effort that we've had to contend with as a result of
that this is the
this is the closure of the financial responsibilities yes
and refunding those
pieces we still have probably about 30% of the development
still remains under
the new owners but they seem to have some new momentum and
we look for that
project to continue okay thank you so much and also I'm
impressed that you
seem to do that without no without notes I guess you you
looked at so I was I
didn't negotiate the arrangement but I knew the parties
yeah and I was probably
responsible for quite some time implementing it so yeah
yeah well thanks
I just you know it was it was it was so complicated and so
but but what you said
confirmed for me you know my own understanding of it and
you also filled
in some of the history so that that was primarily why I
asked I just want to
make sure I understood exactly what that was what what what
had happened and to
just confirm that this is the final chapter of that that
saga so thank you
any other questions questions from Tim no thank you thank
you okay do we have a
motion on item D I move have a motion to approve is there a
second and a second
from Brendan any discussion all in favor say aye aye any
opposed same sign motion
carries okay next item we have is the public utility board
meeting minutes for
March 26 2018 these have been distributed in advance for
their any
questions changes comments to those hearing none is there a
motion to approve
those is presented then to approve okay second second and a
second discussion
all in favor say aye any opposed same sign minutes are
approved next we have
the ACM update good morning mr. chairman and members of the
board in your in your
packet you'll have your future agenda items for the for
upcoming pub meetings
excuse me if you see at your second meeting in April you'll
have some power
supply items and then as we move forward into latter part
early part of May you
will be starting the some of the budget conversations on C
IP with water and
wastewater so we'll be getting into the budget season so a
lot of more
conversations about about the operating budgets and capital
project budgets of
those other various utilities so stay tuned more to come so
that's all I have
on the future agenda design future agenda items on the new
business matrix
some of the things that were listed still for outstanding
on outstanding
issues are to be discussed during the budget process I did
hear over the course
of today's meeting some additional information at the board
requested on the
landfill entrance the road the cost and some of the
decision factors that were
made there and also a work session on the DME capital
improvement programs so
and the FERC report and actually can can can I can we
expand that and and because
what we're seeing changes in solid waste as well I don't
know if there's projects
there that have been delayed or changed or modified
significantly I don't know
that wastewater or water has I don't think we've seen that
kind of stuff come
at us and some time ago we were presented with and I think
it was you
that gave it to us it showed all the projects and there was
a timeline had
some colored lines showing us maybe the project inception
and maybe how far along
they were and if we could get if we could get something
like that that shows
us you know when when we finalize these projects when we
thought they would be
complete where we what percentage completion we are now and
when we think
we're good they're actually going to be complete and the
dollar amount associated
with what we're gonna have to pay because it took us so
long to complete
to get them going I think that information will help me a
lot is that
strictly to DME projects or is that everything well I mean
the things that I've
been uncomfortable with have been DME projects and solid
waste stuff so and
more information which is you know
all right concluding items I think we just covered but are
there any other
yes yeah yeah I would I would add to that so I second that
and I would like
to see you know even though we've we've seen mostly no DME
and solid waste I'd
like to know from water you know a presentation at some
point and maybe this
is just already going to be part of the budget discussion
but about what their
needs are because I know that there are needs in water you
know to keep up with
the growth and I want to know what what what those needs
are and what the what
the timeline is how pressing those needs are okay can we
that'll be will that be
part of the CIP discussion on on the in the budget process
so we'll look at five
years at least five five years great good and I had there
was one other thing
that I wanted to ask I guess for a staff report on a staff
report should probably
suffice and this was a question that I had it was has been
partly answered I
mean it says about about sponsorship procedure and there is
recently so
there's a so DME has a host table at a upcoming charity g
ala and and I just
found this out last week and they're gonna be some council
people going and
and PUB was invited to attend and I had I had requested I
had asked if I could
um pay my own way and I just found out I was able to pay my
own way so that it
so that it wouldn't be coming you know at least from my
part from from public
money um but I wanted to know because it mentioned in the
email that it was a
decision that came from that the the call to to sponsor
that that table at
the charity gala came from the city manager's office and so
I wanted to know
you know what the what the procedure was if if that ever
went to you know maybe
that's something that went to PUB or council in the past
before I got on board
PUB and and then whether that is coming from from rate
payers funds from from
DME funds or if it's coming from taxpayer money and you
know in some other
capacity so I'm really just curious you know kind of what
how that decision came
to be made and then what the protocol is for that we'll be
glad to get you the
staff report on that that's consistent with the sponsorship
policy that we had
brought forward to the PUB and the City Council a couple of
months ago I did
want also mentioned to you that the council's asked us to
have a different
process or consider a different process for sponsorships
and approving those
looking at using the hotel occupancy tax committee which is
made up of three
council members to bring those requests through and then
make recommendations
back to the council so more to come on that but we'll be
happy to get you a
more detailed report on it is that part of that policy I
believe was was it a
quarterly report we were gonna get that's right on all the
sponsorships
that's right we'll do that and then of course during the
budget process all of
the all of those are listed in the in the budget process
when we do that okay
very good all right any any other concluding items hearing
none is there a
motion to adjourn motion adjourned and a second second from
Lillia all in favor
say aye aye any opposed thank you