WEBVTT 00:00:00.000 --> 00:00:01.840 Okay. Good morning. 00:00:01.840 --> 00:00:03.840 It's 9.01 and we do have a quorum, 00:00:03.840 --> 00:00:05.400 so we'll call to order the City of 00:00:05.400 --> 00:00:07.760 Denton Public Utilities Board for Monday, 00:00:07.760 --> 00:00:09.880 September 12th, 2020. 00:00:09.880 --> 00:00:13.240 The first item is presentations from members of the public. 00:00:13.240 --> 00:00:17.360 Is anyone from the public wishing to speak this morning? 00:00:17.360 --> 00:00:21.920 Okay. Seeing none, the next item is consent agenda. 00:00:21.920 --> 00:00:24.760 Does any board member wish to remove an item A 00:00:24.760 --> 00:00:28.120 through F on the consent agenda? 00:00:30.200 --> 00:00:32.000 I see none. 00:00:32.000 --> 00:00:35.760 Do we have a motion to approve the consent agenda? 00:00:35.760 --> 00:00:39.040 So Mr. Rybeck moves. 00:00:39.040 --> 00:00:44.440 Ben seconds. I just had a memory loss on your last name. 00:00:44.440 --> 00:00:46.080 All in favor say aye. 00:00:46.080 --> 00:00:47.000 Aye. 00:00:47.000 --> 00:00:48.240 Motion carries. 00:00:48.240 --> 00:00:49.680 Aye for me too. 00:00:49.680 --> 00:00:53.760 Next item is consider approval of the August 22nd minutes. 00:00:53.760 --> 00:00:56.880 Were there any corrections to the minutes? 00:00:56.880 --> 00:01:01.400 Seeing none, do we have a motion to approve the minutes? 00:01:01.400 --> 00:01:05.040 Devin's moved and Larry second. 00:01:05.040 --> 00:01:06.320 All in favor say aye. 00:01:06.320 --> 00:01:07.120 Aye. 00:01:07.120 --> 00:01:11.040 Carries. The next three items we're going to call all at once 00:01:11.040 --> 00:01:14.880 since they're all regarding the same haulers contracts. 00:01:14.880 --> 00:01:16.760 Mr. Boehner. 00:01:16.760 --> 00:01:18.880 Good morning. I'm Brian Boehner. 00:01:18.880 --> 00:01:21.520 I am the Director of Solid Waste for the City of Denton, 00:01:21.520 --> 00:01:23.720 and I appreciate the opportunity today to talk about 00:01:23.720 --> 00:01:25.640 the waste hauler agreements that are before 00:01:25.640 --> 00:01:28.200 you for consideration. 00:01:28.200 --> 00:01:31.520 A little bit of just a primer real quick. 00:01:31.520 --> 00:01:33.160 What is a waste hauler agreement? 00:01:33.160 --> 00:01:35.480 In the industry we call it a put or pay contract, 00:01:35.480 --> 00:01:36.560 and that's really what it is. 00:01:36.560 --> 00:01:41.520 We contract with private haulers to put a defined amount 00:01:41.520 --> 00:01:46.360 of volume into the landfill at a set price, 00:01:46.360 --> 00:01:48.000 whether they put it there or not. 00:01:48.000 --> 00:01:51.760 So just say for example we have 100 tons that they're going 00:01:51.760 --> 00:01:55.520 to guarantee us for $100 even if they only 00:01:55.520 --> 00:01:58.440 deliver 90 tons they still owe us the $100. 00:01:58.440 --> 00:02:02.960 So what it does is it really guarantees and allows us 00:02:02.960 --> 00:02:06.560 to do some things from a revenue standpoint. 00:02:06.560 --> 00:02:09.040 First of all guaranteed revenue stream. 00:02:09.040 --> 00:02:12.200 So we're not always concerned about what's coming in, 00:02:12.200 --> 00:02:13.040 what's going out. 00:02:13.040 --> 00:02:15.880 On a monthly basis it's stabilized. 00:02:15.880 --> 00:02:19.240 Secondarily it stabilizes the rates for the residents. 00:02:19.240 --> 00:02:24.240 So again our residents are able to enjoy the benefit 00:02:25.400 --> 00:02:28.080 of the resource and the asset that we have. 00:02:28.080 --> 00:02:29.960 And really it aids us in long term planning 00:02:29.960 --> 00:02:34.120 for our operations such as staffing, equipment purchases, 00:02:34.120 --> 00:02:36.040 trying to prepare for growth. 00:02:36.040 --> 00:02:40.120 From a history standpoint operating as a regional facility 00:02:40.120 --> 00:02:45.120 since 1985 we have always accepted waste from waste haulers. 00:02:45.120 --> 00:02:46.960 Certain waste haulers had accounts 00:02:46.960 --> 00:02:49.760 and had beneficial rate preferences 00:02:49.760 --> 00:02:52.840 but it was never codified, never put into a contract. 00:02:52.840 --> 00:02:54.240 Just you got it. 00:02:54.240 --> 00:02:56.800 About three years ago what we did is we went ahead 00:02:56.800 --> 00:02:59.600 and tried to put this actually into a contract, 00:02:59.600 --> 00:03:01.920 a little more equitable standpoint, 00:03:01.920 --> 00:03:06.800 actually treated the capacity as an asset 00:03:06.800 --> 00:03:08.200 and put it out on the open market. 00:03:08.200 --> 00:03:10.840 And at that point we had four contractors, 00:03:10.840 --> 00:03:13.240 haulers that stepped forward and two entities 00:03:13.240 --> 00:03:16.360 that we entered into three year contracts with. 00:03:16.360 --> 00:03:18.000 At that time we didn't set a ceiling 00:03:18.000 --> 00:03:19.400 on how much waste we wanted. 00:03:19.400 --> 00:03:22.360 It was like okay you tell us how much capacity you need, 00:03:22.360 --> 00:03:23.760 how much you're gonna pay for it. 00:03:23.760 --> 00:03:26.360 And really and that's what you delivered. 00:03:26.360 --> 00:03:28.600 So we had a significant amount of material 00:03:28.600 --> 00:03:30.920 that was coming into the landfill. 00:03:30.920 --> 00:03:32.000 But the thing about it was 00:03:32.000 --> 00:03:33.520 even though there were recycling programs 00:03:33.520 --> 00:03:35.840 that were going on with these programs 00:03:35.840 --> 00:03:37.240 and these waste haulers were bringing in, 00:03:37.240 --> 00:03:38.520 we didn't know what they were. 00:03:38.520 --> 00:03:40.920 We didn't know how much material was being diverted. 00:03:40.920 --> 00:03:43.120 So really there was no incentive to recycle. 00:03:43.120 --> 00:03:46.240 It was open market for lack of a better term. 00:03:46.240 --> 00:03:49.560 As a result of these three year contracts 00:03:49.560 --> 00:03:50.520 couple things happened. 00:03:50.520 --> 00:03:52.360 First of all we significantly paid down 00:03:52.360 --> 00:03:55.840 our outstanding debt, got our finances under control. 00:03:55.840 --> 00:03:59.080 Secondarily as we continue to discuss 00:03:59.080 --> 00:04:01.760 we were able to reduce residential rates. 00:04:01.760 --> 00:04:03.440 So those of you who are, 00:04:03.440 --> 00:04:05.200 everybody here is a city of Denton resident. 00:04:05.200 --> 00:04:06.560 So hopefully over the past three years 00:04:06.560 --> 00:04:09.440 you noticed that we dropped the rate four or five dollars 00:04:09.440 --> 00:04:12.280 and really we continue to work 00:04:12.280 --> 00:04:16.280 to maintain that rate structure. 00:04:16.280 --> 00:04:19.480 - Say Brian before you move on I'm sorry to interrupt. 00:04:19.480 --> 00:04:23.880 So you mentioned that we significantly paid down our debt. 00:04:23.880 --> 00:04:25.600 What is the history of that debt 00:04:25.600 --> 00:04:28.240 just for informational purposes? 00:04:28.240 --> 00:04:29.640 - When you ask about history 00:04:29.640 --> 00:04:31.800 what did that debt go for? 00:04:31.800 --> 00:04:34.320 Yeah, there were some property purchases 00:04:34.320 --> 00:04:36.840 we made for our expansion. 00:04:36.840 --> 00:04:38.480 There were several programs also 00:04:38.480 --> 00:04:40.720 that were envisioned at that point 00:04:40.720 --> 00:04:42.520 that required a lot of machinery, 00:04:42.520 --> 00:04:44.360 a lot of upfront costs 00:04:44.360 --> 00:04:48.880 that were never put into practice. 00:04:48.880 --> 00:04:50.760 Or they shut down rather rapidly 00:04:50.760 --> 00:04:53.160 so we had this long term debt piece 00:04:53.160 --> 00:04:55.000 but really no operation to offset it. 00:04:55.000 --> 00:04:57.280 So really that's what we were trying to control. 00:04:57.280 --> 00:04:58.120 - Thank you. 00:04:58.120 --> 00:04:58.960 - Thank you. 00:04:58.960 --> 00:05:02.280 So over these past three years 00:05:02.280 --> 00:05:03.560 we've been listening to the community, 00:05:03.560 --> 00:05:05.680 listening to council, listening to people. 00:05:05.680 --> 00:05:07.560 And there's always been the argument about 00:05:07.560 --> 00:05:10.520 well you're filling up the landfill, you're losing life. 00:05:10.520 --> 00:05:13.760 Well in these three years 00:05:13.760 --> 00:05:16.720 the contracts that were brought in 00:05:16.720 --> 00:05:20.520 we lost approximately 90 days of life per year. 00:05:20.520 --> 00:05:23.920 So about three quarters of a year of landfill life 00:05:23.920 --> 00:05:26.400 of the 55 years that we currently have 00:05:26.400 --> 00:05:28.760 was lost as a result of these contracts. 00:05:28.760 --> 00:05:31.320 And again this waste would have come here anyway 00:05:31.320 --> 00:05:32.680 or a majority of it would. 00:05:32.680 --> 00:05:36.440 So it's kind of a, it's a non-equitable comparison 00:05:36.440 --> 00:05:40.280 but again that's what the waste accounts for. 00:05:40.280 --> 00:05:43.520 There was a concern about increase in landfill traffic. 00:05:43.520 --> 00:05:46.920 Currently we're averaging about 500 transaction a day total. 00:05:46.920 --> 00:05:49.440 25% of that comes from these waste haulers. 00:05:49.440 --> 00:05:52.560 Another 25% comes from our city of Denton operation. 00:05:52.560 --> 00:05:55.960 What's interesting is that 50% of the people 00:05:55.960 --> 00:05:58.240 that come across the scale day in and day out 00:05:58.240 --> 00:06:00.360 are actually cash customers. 00:06:00.360 --> 00:06:02.080 They're either the independent landscapers, 00:06:02.080 --> 00:06:04.400 independent contractors bringing material to us 00:06:04.400 --> 00:06:06.200 or it's the mom and pops that are just cleaning out 00:06:06.200 --> 00:06:10.960 the garage that you know need to get rid of material. 00:06:10.960 --> 00:06:15.720 A little side note here, keeping involved in the industry 00:06:15.720 --> 00:06:18.320 people were wringing their hands over COVID. 00:06:18.320 --> 00:06:20.280 We are locked down, we're not gonna see the waste, 00:06:20.280 --> 00:06:21.520 it's gonna affect us. 00:06:21.520 --> 00:06:23.440 No, landfill traffic shot up 00:06:23.440 --> 00:06:25.600 because you can only mow the yard so much, 00:06:25.600 --> 00:06:28.320 you can only weed the petunia bed so much. 00:06:28.320 --> 00:06:29.160 What are you gonna do? 00:06:29.160 --> 00:06:30.320 You're gonna clean out the garage. 00:06:30.320 --> 00:06:32.960 So we just saw a lot of material coming in 00:06:32.960 --> 00:06:34.840 over that COVID period. 00:06:34.840 --> 00:06:36.600 So and that adds into that 00:06:36.600 --> 00:06:39.320 and we haven't really seen that plateau or drop off. 00:06:39.320 --> 00:06:41.680 That number continues to rise. 00:06:41.680 --> 00:06:44.640 So again as an asset with the growth that's happening 00:06:44.640 --> 00:06:46.800 in this area, you see it coming up through Frisco, 00:06:46.800 --> 00:06:49.640 through Argyle, it's sandwiching us in here 00:06:49.640 --> 00:06:51.440 and people are coming bringing us materials 00:06:51.440 --> 00:06:52.840 as they're getting ready to move. 00:06:52.840 --> 00:06:56.560 So also another concern was the contract link. 00:06:56.560 --> 00:06:58.960 We went from three years in this proposal 00:06:58.960 --> 00:07:02.000 to two years as we move forward. 00:07:02.000 --> 00:07:05.720 Historically or currently what's in this proposal 00:07:05.720 --> 00:07:09.960 or notice of intent that was issued 8005. 00:07:09.960 --> 00:07:12.720 What we did is instead of setting an open market, 00:07:12.720 --> 00:07:15.680 we decided to put a ceiling or excuse me, 00:07:15.680 --> 00:07:16.840 I'm getting ahead of myself. 00:07:16.840 --> 00:07:18.880 What we decided to do is recognize the asset 00:07:18.880 --> 00:07:21.240 of the landfill itself. 00:07:21.240 --> 00:07:22.360 Under the previous contracts, 00:07:22.360 --> 00:07:25.160 we set the floor at $27 a ton. 00:07:25.160 --> 00:07:28.480 We realized very quickly we significantly underbid 00:07:28.480 --> 00:07:29.600 that asset that we have. 00:07:29.600 --> 00:07:33.800 So we raised the minimum bid to $35 a ton delivered. 00:07:33.800 --> 00:07:36.680 We recognized the asset but also we had to remain 00:07:36.680 --> 00:07:38.920 cost competitive in the region. 00:07:38.920 --> 00:07:41.720 There are basically three or four other facilities 00:07:41.720 --> 00:07:46.720 in this area and that puts us in direct cost equality 00:07:46.720 --> 00:07:49.840 with them so it then just becomes transportation 00:07:49.840 --> 00:07:52.360 which facility is closer and at that point, 00:07:52.360 --> 00:07:54.200 City of Denton wins out. 00:07:54.200 --> 00:07:56.560 Secondly, we put a ceiling on disposal tons. 00:07:56.560 --> 00:07:58.400 In the old contracts, we basically said, 00:07:58.400 --> 00:07:59.680 you tell us what you're gonna bring us 00:07:59.680 --> 00:08:00.880 and we'll contract with you. 00:08:00.880 --> 00:08:03.600 This time we said no, we're gonna put a cap on it. 00:08:03.600 --> 00:08:06.760 So instead of almost 200,000 tons a year 00:08:06.760 --> 00:08:08.480 that we're currently bringing in, 00:08:08.480 --> 00:08:10.960 we set that ceiling of 125,000. 00:08:10.960 --> 00:08:15.960 So really just 60% of what we're currently taking in. 00:08:15.960 --> 00:08:18.920 What we did do though is put some skin in the game 00:08:18.920 --> 00:08:20.200 for the waste haulers. 00:08:20.200 --> 00:08:22.200 What we wanna be able to do again is recognize 00:08:22.200 --> 00:08:23.600 that diversion that's currently out there 00:08:23.600 --> 00:08:26.960 but also incentivize additional opportunities to divert. 00:08:26.960 --> 00:08:29.200 So if you need additional capacity, 00:08:29.200 --> 00:08:33.400 you're not just going to get another 10, 15% next year 00:08:33.400 --> 00:08:34.880 as part of the contract, 00:08:34.880 --> 00:08:36.320 you're gonna have to show us why you need it. 00:08:36.320 --> 00:08:38.560 So if you can divert, let's say, 00:08:38.560 --> 00:08:40.320 let's put that 100 ton example out there. 00:08:40.320 --> 00:08:43.840 Let's say you can divert 10 more tons to recycling, 00:08:43.840 --> 00:08:45.680 that gives you 10 more tons of capacity. 00:08:45.680 --> 00:08:49.520 So you divert the recycling, that gives you 110 tons 00:08:49.520 --> 00:08:53.160 and again, so you're working, we get the benefit 00:08:53.160 --> 00:08:56.720 and then most importantly is we get to recognize, 00:08:56.720 --> 00:08:58.000 first of all, who your customers are 00:08:58.000 --> 00:09:00.360 but secondarily, what's actually being diverted 00:09:00.360 --> 00:09:02.840 and we can show that as the diversion number 00:09:02.840 --> 00:09:04.640 from the City of Denton Landfill. 00:09:04.640 --> 00:09:06.400 Mr. Beck. - Yeah, Ryan, thanks. 00:09:06.400 --> 00:09:12.520 I'm glad to see that the recycling incentive is there 00:09:12.520 --> 00:09:16.240 but I guess it's also saying that they don't have to, 00:09:16.240 --> 00:09:18.840 they just kind of lose out on this discount if they don't. 00:09:18.840 --> 00:09:20.120 Is that right? 00:09:20.120 --> 00:09:21.760 - Potentially yes. - Okay. 00:09:21.760 --> 00:09:23.120 - But again, I've talked to all these guys 00:09:23.120 --> 00:09:24.240 and they're excited about it. 00:09:24.240 --> 00:09:26.440 It's like, it makes a whole lot of sense. 00:09:26.440 --> 00:09:28.000 A lot of the stuff we're currently doing, 00:09:28.000 --> 00:09:30.000 we wanna be able to be recognized for it, 00:09:30.000 --> 00:09:33.040 put that shit in our bin 00:09:33.040 --> 00:09:34.480 but also it gives them an opportunity 00:09:34.480 --> 00:09:36.320 to look at some other programs, 00:09:36.320 --> 00:09:38.800 whether it's curbside recycling 00:09:38.800 --> 00:09:40.920 and again, we're talking about not just recycling, 00:09:40.920 --> 00:09:42.640 we're talking about diversion. 00:09:42.640 --> 00:09:45.400 So recycling is again, is that programmatic material 00:09:45.400 --> 00:09:46.440 in the bin by the curb 00:09:46.440 --> 00:09:49.960 but again, you can divert yard waste, 00:09:49.960 --> 00:09:52.400 you can divert electronics, you can divert appliances. 00:09:52.400 --> 00:09:53.920 So if you've got programs out there 00:09:53.920 --> 00:09:55.840 that manage that other material 00:09:55.840 --> 00:09:57.160 that we would potentially receive 00:09:57.160 --> 00:09:58.280 and would go into the landfill, 00:09:58.280 --> 00:10:01.520 then by all means, let's give you credit for it. 00:10:01.520 --> 00:10:05.080 - And it looks like based on lowering your tonnage per year 00:10:05.080 --> 00:10:07.040 and going from a three to two year contract 00:10:07.040 --> 00:10:09.840 that there's some concern that, 00:10:09.840 --> 00:10:13.560 well, I would ask is this likely not to be sustainable 00:10:13.560 --> 00:10:16.720 long down the road where we can't take care of our own or? 00:10:16.720 --> 00:10:18.680 - No, no, that's not the reason. 00:10:18.680 --> 00:10:19.720 - Okay. 00:10:19.720 --> 00:10:22.400 - Recently, y'all approved our City of Denton's 00:10:22.400 --> 00:10:24.760 comprehensive solid waste management strategy 00:10:24.760 --> 00:10:26.040 and really what we're doing right now 00:10:26.040 --> 00:10:27.400 in these first couple of years 00:10:27.400 --> 00:10:29.280 is starting to spin up programs 00:10:29.280 --> 00:10:33.680 and part of that will be managed through some regionalization 00:10:33.680 --> 00:10:36.400 of some processes that we're gonna be proposing 00:10:36.400 --> 00:10:38.200 such as our home chemical collection. 00:10:38.200 --> 00:10:40.360 Right now, we're the only city 00:10:40.360 --> 00:10:42.880 basically in Denton County, possibly Frisco 00:10:42.880 --> 00:10:45.880 that offers a home chemical collection 00:10:45.880 --> 00:10:48.320 but we've got a bunch of small cities in this area. 00:10:48.320 --> 00:10:50.880 So we want to be able to take that type of material, 00:10:50.880 --> 00:10:52.880 recognize that diversion. 00:10:52.880 --> 00:10:54.720 Looking at yard waste programs, 00:10:54.720 --> 00:10:56.560 I know that in talking with our partners 00:10:56.560 --> 00:10:58.360 over at the water and wastewater plant, 00:10:58.360 --> 00:11:01.160 we've got this terrific program called Dino Dirt 00:11:01.160 --> 00:11:02.360 but we could really grow that 00:11:02.360 --> 00:11:04.120 and if we're gonna be feeding food waste into that, 00:11:04.120 --> 00:11:06.720 we need more yard waste to help brown and green 00:11:06.720 --> 00:11:09.640 the compost mixture. 00:11:09.640 --> 00:11:10.840 So again, working with them 00:11:10.840 --> 00:11:13.000 to actually have yard waste diversion programs 00:11:13.000 --> 00:11:14.120 instead of sending it. 00:11:14.120 --> 00:11:16.400 Think about construction demolition debris, 00:11:16.400 --> 00:11:18.800 boards that are this long that are going to landfill 00:11:18.800 --> 00:11:19.720 but they're perfectly good. 00:11:19.720 --> 00:11:22.080 If we can find a contractor 00:11:22.080 --> 00:11:23.720 that wants those short pieces of board 00:11:23.720 --> 00:11:26.000 to make chipboard or whatever else out of. 00:11:26.000 --> 00:11:27.080 So these are the type of things 00:11:27.080 --> 00:11:28.480 that we want to be able to recognize. 00:11:28.480 --> 00:11:30.760 And if we put a three-year contract, 00:11:30.760 --> 00:11:32.400 it may be too far down the line 00:11:32.400 --> 00:11:33.560 to be able to roll that in 00:11:33.560 --> 00:11:35.020 but a two-year it gives us time 00:11:35.020 --> 00:11:36.800 to put these programs in place 00:11:36.800 --> 00:11:40.200 so that when the next two years start, 00:11:40.200 --> 00:11:42.400 we can actually give you some benefit 00:11:42.400 --> 00:11:44.280 and maybe even use our asset here 00:11:44.280 --> 00:11:46.880 to drive more material that way economically. 00:11:46.880 --> 00:11:48.120 - Okay, thanks. 00:11:48.120 --> 00:11:48.960 - Thank you. 00:11:48.960 --> 00:11:50.080 - Mr. Rybeck, go ahead. 00:11:50.080 --> 00:11:51.880 - Go ahead. 00:11:51.880 --> 00:11:53.720 - Okay, I thought you were looking over there. 00:11:53.720 --> 00:11:55.360 I love the allowance program. 00:11:55.360 --> 00:11:57.880 I think as part of this program, that's a great idea. 00:11:57.880 --> 00:12:01.800 Why the 10% cap and you could incentivize them more, 00:12:01.800 --> 00:12:03.680 20%, 25%? 00:12:03.680 --> 00:12:05.280 - We could, we could. 00:12:05.280 --> 00:12:07.160 But I think part of it was let's get our, 00:12:07.160 --> 00:12:09.560 let's, you know, the rule of nature is you crawl, 00:12:09.560 --> 00:12:11.080 you walk, you run. 00:12:11.080 --> 00:12:13.400 And so let's crawl here, see what it is 00:12:13.400 --> 00:12:15.040 and then, you know, get our hands up. 00:12:15.040 --> 00:12:17.080 And if it needs to be bigger than the next two years, 00:12:17.080 --> 00:12:19.320 we can incentivize that even more. 00:12:19.320 --> 00:12:20.500 - And again, with the two years, 00:12:20.500 --> 00:12:24.000 we have that time to look at what we've done at 10%. 00:12:24.000 --> 00:12:24.840 - Exactly. 00:12:24.840 --> 00:12:27.800 - So we can go to 20 or 25 based on real data. 00:12:27.800 --> 00:12:30.000 - And in reality, I don't think that they're going to say, 00:12:30.000 --> 00:12:31.720 well, here's just the 10%. 00:12:31.720 --> 00:12:32.720 They're gonna come in and say, 00:12:32.720 --> 00:12:36.240 okay, we were able to divert 45%. 00:12:36.240 --> 00:12:37.200 So when you're looking, you know, 00:12:37.200 --> 00:12:38.520 so we get a, you know, 00:12:38.520 --> 00:12:40.120 what is actually happening in the market, 00:12:40.120 --> 00:12:43.000 but also it gives us the opportunity to understand 00:12:43.000 --> 00:12:46.040 what those drivers are in the private sector, 00:12:46.040 --> 00:12:48.040 those people that have private companies 00:12:48.040 --> 00:12:49.320 picking up things at the curb. 00:12:49.320 --> 00:12:51.640 It allows us to try to work with them 00:12:51.640 --> 00:12:53.800 to widen the market, so to speak. 00:12:55.800 --> 00:12:57.000 - Go ahead. 00:12:57.000 --> 00:12:58.560 - Thank you. 00:12:58.560 --> 00:13:02.320 So I found that the page in the con, 00:13:02.320 --> 00:13:04.640 the, I guess this is in the bid, 00:13:04.640 --> 00:13:07.960 perhaps it's in the bid about talking about this-- 00:13:07.960 --> 00:13:08.800 - 10%. 00:13:08.800 --> 00:13:09.640 - 10%-- - Yes. 00:13:09.640 --> 00:13:13.320 - Diverted allowance, I'm not quite understanding. 00:13:13.320 --> 00:13:18.320 So is that like, they have a, you know, 00:13:18.320 --> 00:13:20.320 50,000 ton a year, or we'll do the 100, 00:13:20.320 --> 00:13:23.920 100 ton a year allowance in the contract. 00:13:23.920 --> 00:13:26.200 They divert, is it a one for one? 00:13:26.200 --> 00:13:29.600 They divert 10 tons, they get that additional 10 tons? 00:13:29.600 --> 00:13:31.360 - Yes, it is net, so net 10 tons. 00:13:31.360 --> 00:13:36.360 So let's say you take 30 tons to the Murph, 00:13:36.360 --> 00:13:41.040 but 20 tons of it is contaminated 00:13:41.040 --> 00:13:43.200 and goes out the back end and goes to the landfill. 00:13:43.200 --> 00:13:46.360 They only get credit for the 10 tons that is net recycled. 00:13:46.360 --> 00:13:49.000 So it's not the 30 tons, it's the 10 tons. 00:13:49.000 --> 00:13:53.640 - And then they, so now they're putting 110 tons 00:13:53.640 --> 00:13:56.840 in the landfill, some 10 or 20 at the Murph, 00:13:56.840 --> 00:13:57.680 something like that. 00:13:57.680 --> 00:13:58.520 - Correct. 00:13:58.520 --> 00:14:01.320 - And they're still paying the $35 or whatever 00:14:01.320 --> 00:14:03.320 contract rate for that additional? 00:14:03.320 --> 00:14:04.400 - 10 tons, correct. 00:14:04.400 --> 00:14:07.080 - And the Murph, is that also billed, 00:14:07.080 --> 00:14:10.080 or is that like free or discounted or its own rate? 00:14:10.080 --> 00:14:14.720 - That is the private, that is their private contract 00:14:14.720 --> 00:14:16.040 with whatever it is. 00:14:16.040 --> 00:14:19.080 I will tell you that from an industry standard right now, 00:14:19.080 --> 00:14:23.040 most people are paying between 65 and $95 a ton 00:14:23.040 --> 00:14:25.400 to process material through a Murph. 00:14:25.400 --> 00:14:30.160 It's not cheap, but again, from a conservation standpoint, 00:14:30.160 --> 00:14:31.400 people are willing to pay that. 00:14:31.400 --> 00:14:33.720 But again, you've got revenue on the back end, 00:14:33.720 --> 00:14:35.480 as long as the market's up, you know, 00:14:35.480 --> 00:14:38.320 you're not technically paying quite that much. 00:14:38.320 --> 00:14:40.440 - And so basically they pay $65 a ton 00:14:40.440 --> 00:14:44.160 and they get palletized material they could sell, 00:14:44.160 --> 00:14:45.360 something like that. 00:14:45.360 --> 00:14:49.200 - Yeah, but the Murph operators are all private sector. 00:14:49.200 --> 00:14:52.480 So they have the paper market and the plastics and the glass, 00:14:52.480 --> 00:14:54.080 they've got places to send this. 00:14:54.080 --> 00:14:55.720 - Okay, and they don't have to bring it to our Murph, 00:14:55.720 --> 00:14:56.840 they just have to prove they're taking it 00:14:56.840 --> 00:14:59.880 to some diversion, some approved diversion. 00:14:59.880 --> 00:15:01.760 - Yeah, and they can't just send us a letter saying, 00:15:01.760 --> 00:15:03.880 here's what we did, we've got to have the Murph reports, 00:15:03.880 --> 00:15:06.960 the public reports, they get back from the Murph 00:15:06.960 --> 00:15:09.040 that shows what that balance is. 00:15:09.040 --> 00:15:10.800 - Okay, and that, and it is a one for one though, 00:15:10.800 --> 00:15:13.400 10 tons over here equals 10 tons. 00:15:13.400 --> 00:15:15.840 - It is a one for one, correct, up to 10 tons. 00:15:15.840 --> 00:15:16.680 - Thank you. 00:15:16.680 --> 00:15:18.360 - Okay, yes sir. 00:15:18.360 --> 00:15:20.320 - Just keep rolling here. 00:15:20.320 --> 00:15:24.040 All right, so I went to the landfill 00:15:24.040 --> 00:15:25.920 for the first time recently myself, 00:15:25.920 --> 00:15:27.840 and I'm pretty sure I know the answer to this question, 00:15:27.840 --> 00:15:29.600 but just to ask it for the record, 00:15:29.600 --> 00:15:34.600 is it possible to divert anything after customers 00:15:34.600 --> 00:15:37.520 put it in the pile? 00:15:37.520 --> 00:15:40.240 I know, I know. 00:15:40.240 --> 00:15:43.400 I mean, for example, so when I was there, 00:15:43.400 --> 00:15:47.680 I saw a lot of electronics, TVs, furniture, desks, chairs, 00:15:47.680 --> 00:15:51.120 wood scraps, things that could be used or refurbished 00:15:51.120 --> 00:15:53.520 had it been put somewhere else, 00:15:53.520 --> 00:15:58.520 is it even remotely feasible to somehow divert that? 00:15:58.520 --> 00:16:02.440 - It is feasible, but before it reaches the working face. 00:16:02.440 --> 00:16:04.000 Once material hits the working face 00:16:04.000 --> 00:16:06.920 and touches the tipping floor, it is considered trash. 00:16:06.920 --> 00:16:09.600 It is probably the most unsafe thing that you can do 00:16:09.600 --> 00:16:11.920 to try to pull material out of there. 00:16:11.920 --> 00:16:15.440 Again, employees and customer safety comes first. 00:16:15.440 --> 00:16:18.320 So once it hits the floor, it's in the landfill. 00:16:18.320 --> 00:16:19.400 But as part of that comprehensive 00:16:19.400 --> 00:16:20.640 solid waste management strategy, 00:16:20.640 --> 00:16:22.920 we wanna set in place those opportunities 00:16:22.920 --> 00:16:25.560 that if you come to the landfill and you've got that desk, 00:16:25.560 --> 00:16:30.080 or you've got that article that can be diverted, 00:16:30.080 --> 00:16:32.080 you can go through and divert that material 00:16:32.080 --> 00:16:35.600 before you go to the working face, so it never goes there. 00:16:35.600 --> 00:16:37.600 And you do it at a much less cost 00:16:37.600 --> 00:16:40.080 than what you would be paying at the gate rate. 00:16:40.080 --> 00:16:43.520 - So how does somebody like me clean out my garage? 00:16:43.520 --> 00:16:45.480 I've got an old TV, some wood scraps. 00:16:45.480 --> 00:16:50.080 I don't recall seeing where to take those things. 00:16:50.080 --> 00:16:52.320 Is that-- - You are correct. 00:16:52.320 --> 00:16:54.320 - Okay. - Yeah, that currently, 00:16:54.320 --> 00:16:57.600 I mean, it's extremely arduous to find something. 00:16:57.600 --> 00:16:58.800 First place I would go to 00:16:58.800 --> 00:17:01.000 is on the City of Denton's Recycle website. 00:17:01.000 --> 00:17:02.780 We have what's called the Waste Wizard. 00:17:02.780 --> 00:17:05.520 You go in there, you type in, I have an old file cabinet. 00:17:05.520 --> 00:17:07.080 And it'll say-- - Tells you what to do 00:17:07.080 --> 00:17:08.600 with it basically. - What to do with it basically. 00:17:08.600 --> 00:17:11.380 But what we wanna do is try to make it a little more simple 00:17:11.380 --> 00:17:14.240 and find those operators who will step forward 00:17:14.240 --> 00:17:17.200 and actually create opportunities at the landfill 00:17:17.200 --> 00:17:20.000 or some other place that's centrally located 00:17:20.000 --> 00:17:21.860 for you to take that material. 00:17:21.860 --> 00:17:22.700 - Great, thanks. 00:17:22.700 --> 00:17:26.640 - All right. - Okay, I think 00:17:26.640 --> 00:17:28.120 you can keep going. 00:17:28.120 --> 00:17:31.660 - All right, so when we put our notice of intent out, 00:17:31.660 --> 00:17:35.440 we had four waste haulers that proposed. 00:17:35.440 --> 00:17:38.840 And really, we exceeded the volume of tonnage 00:17:38.840 --> 00:17:41.440 that we were willing to contract by almost double. 00:17:41.440 --> 00:17:45.000 So again, three guys, one, one guy, you know. 00:17:45.000 --> 00:17:47.520 If you would've sweetened his bid just a little bit more, 00:17:47.520 --> 00:17:50.840 we may be looking at two contracts instead of three. 00:17:50.840 --> 00:17:53.560 But at the end of the day, we selected the best three bids 00:17:53.560 --> 00:17:56.120 that provided the highest cost 00:17:56.120 --> 00:17:59.420 and source of revenue to the city. 00:17:59.420 --> 00:18:01.600 And what was interesting is the tonnage that came in 00:18:01.600 --> 00:18:04.360 was actually below the maximum amount contemplated. 00:18:04.360 --> 00:18:09.360 So we're not at the 125 tons maximum that we were looking at. 00:18:09.360 --> 00:18:11.080 The three haulers we'll be considering today 00:18:11.080 --> 00:18:15.280 are Waste Connections, Rhino Removal, and Frontier Waste. 00:18:15.280 --> 00:18:20.280 Their initial bid was 105,000 tons with that 10% allowance. 00:18:20.280 --> 00:18:23.880 We're looking at 115,500 ton 00:18:23.880 --> 00:18:26.900 with potential revenues of 4.2 million. 00:18:26.900 --> 00:18:29.560 We're also looking at two interlocal agreements 00:18:29.560 --> 00:18:30.820 that you'll probably be seeing here 00:18:30.820 --> 00:18:32.960 within the next few weeks. 00:18:32.960 --> 00:18:34.960 Two government entities have expressed an interest 00:18:34.960 --> 00:18:37.960 in continuing their relationship with us. 00:18:37.960 --> 00:18:40.280 We wanted to work to memorialize those agreements 00:18:40.280 --> 00:18:42.200 of tonnage and rate. 00:18:42.200 --> 00:18:46.320 We're not including a diversion incentive with that, 00:18:46.320 --> 00:18:49.360 but we will get any sort of diversion recognition 00:18:49.360 --> 00:18:50.520 back through them. 00:18:50.520 --> 00:18:53.220 And we'll be working to create programs 00:18:53.220 --> 00:18:55.720 for the next contract to help them 00:18:55.720 --> 00:18:57.760 from a regional standpoint. 00:18:57.760 --> 00:19:01.080 Those two are the city of Little Elm and Wise County. 00:19:01.080 --> 00:19:04.840 So again, they've proposed 5,400 tons 00:19:04.840 --> 00:19:07.080 with revenue of $189,000. 00:19:07.080 --> 00:19:08.440 So when all is said and done, 00:19:08.440 --> 00:19:11.720 if you look at the previous contracts with their 10% 00:19:11.720 --> 00:19:14.160 plus what we're looking at the interlocal agreements, 00:19:14.160 --> 00:19:19.040 we could be looking at the potential of 121,000 tons roughly 00:19:19.040 --> 00:19:24.040 at almost 4.4 million dollars annually 00:19:24.040 --> 00:19:27.280 over the next two years with this contract. 00:19:27.280 --> 00:19:28.840 So what we would recommend 00:19:28.840 --> 00:19:32.080 is to approve each of these contracts 00:19:32.080 --> 00:19:34.760 for consideration by the city council. 00:19:34.760 --> 00:19:38.000 Be glad to answer any additional questions 00:19:38.000 --> 00:19:39.680 that you might have. 00:19:39.680 --> 00:19:41.440 - Are there additional questions? 00:19:41.440 --> 00:19:44.080 Yes, go ahead, Mr. Taylor. 00:19:44.080 --> 00:19:46.160 - Not so much a question. 00:19:46.160 --> 00:19:49.280 I just wanna say I think this is a really good way 00:19:49.280 --> 00:19:51.040 of managing our asset, 00:19:51.040 --> 00:19:54.540 of getting the best value to the landfill for Denton, 00:19:54.540 --> 00:19:58.520 and also encouraging regional diversion and recycling. 00:19:58.520 --> 00:20:01.200 And I think 10% is a little low, 00:20:01.200 --> 00:20:02.440 but it's a great starting point. 00:20:02.440 --> 00:20:04.760 And like you said, we have a two-year contract. 00:20:04.760 --> 00:20:08.240 And as we build out our programs into regional programs, 00:20:08.240 --> 00:20:10.600 then these smaller haulers in the county 00:20:10.600 --> 00:20:13.280 that are coming from the Provinces 00:20:13.280 --> 00:20:16.560 and other like Wise County, rural counties, 00:20:16.560 --> 00:20:18.320 this gives them an opportunity 00:20:18.320 --> 00:20:20.400 to build those programs as well. 00:20:20.400 --> 00:20:22.880 And with that, I think I would move for, 00:20:22.880 --> 00:20:24.840 are we moving one or all three? 00:20:24.840 --> 00:20:27.120 - We need to take them individually, right, Ms. Marcella? 00:20:27.120 --> 00:20:29.720 - I will move item A for approval. 00:20:29.720 --> 00:20:34.640 - Item B with frontier waste solutions is the first one. 00:20:34.640 --> 00:20:37.280 - I'm sorry, item B with frontier waste solutions 00:20:37.280 --> 00:20:38.120 for approval. 00:20:38.120 --> 00:20:39.360 - Do we have a second? 00:20:39.360 --> 00:20:40.920 - Second. 00:20:40.920 --> 00:20:41.740 - Larry. 00:20:41.740 --> 00:20:44.680 Oh, okay. 00:20:44.680 --> 00:20:46.400 So it's Mr. Jumper gets the second. 00:20:46.400 --> 00:20:48.040 All in favor say aye. 00:20:48.040 --> 00:20:48.880 - Aye. 00:20:48.880 --> 00:20:50.040 - That one carries. 00:20:50.040 --> 00:20:55.040 The next one is PUB 22120 with rhino removal LLC. 00:20:55.940 --> 00:20:59.740 Do we have a motion to approve Mr. Rybeck motion? 00:20:59.740 --> 00:21:01.260 Mr. Beck seconded. 00:21:01.260 --> 00:21:02.760 All in favor say aye. 00:21:02.760 --> 00:21:04.080 - Aye. 00:21:04.080 --> 00:21:07.000 - And the last one is PUB 22121 00:21:07.000 --> 00:21:10.000 with waste connections Lone Star Inc. 00:21:10.000 --> 00:21:11.480 Do we have a motion? 00:21:11.480 --> 00:21:14.280 Mr. Jumper, Mr. Cheek seconds. 00:21:14.280 --> 00:21:15.720 All in favor say aye. 00:21:15.720 --> 00:21:16.740 - Aye. 00:21:16.740 --> 00:21:17.580 - Thank you. 00:21:17.580 --> 00:21:18.680 - Thank you very much. 00:21:18.680 --> 00:21:22.500 - The next item is to formalize a return on investment 00:21:22.500 --> 00:21:24.460 payment with the city utility funds. 00:21:26.640 --> 00:21:28.280 - Good morning, Chair, PEB members, 00:21:28.280 --> 00:21:30.120 Nick Vincent, Assistant Director of Finance. 00:21:30.120 --> 00:21:32.720 Let me get this pulled up really quick. 00:21:32.720 --> 00:21:34.440 My hands to work, they're cold this morning. 00:21:34.440 --> 00:21:36.180 It's pretty cold in here. 00:21:36.180 --> 00:21:39.200 So yeah, this is to formalize the return on investment 00:21:39.200 --> 00:21:41.320 payment for water, wastewater, and electric 00:21:41.320 --> 00:21:42.500 to the general fund. 00:21:42.500 --> 00:21:44.480 Let me share this. 00:21:44.480 --> 00:21:51.600 So we'll read the first bullet point. 00:21:51.600 --> 00:21:52.920 We really already talked about that. 00:21:52.920 --> 00:21:55.340 But this ordinance will formalize the return on investment 00:21:55.340 --> 00:21:58.400 payment that you saw during the proposed budgets 00:21:58.400 --> 00:22:01.960 for water, wastewater, and electric to the general fund. 00:22:01.960 --> 00:22:04.360 Electric's ROI is currently 6%, 00:22:04.360 --> 00:22:05.880 as discussed to the Public Utility Board 00:22:05.880 --> 00:22:07.200 during those presentations. 00:22:07.200 --> 00:22:10.740 Water's 3.5%, wastewater's 3.5%. 00:22:10.740 --> 00:22:17.080 Just really quick one to show you the amount 00:22:17.080 --> 00:22:18.600 that each of these utilities budget 00:22:18.600 --> 00:22:19.520 and return on investment. 00:22:19.520 --> 00:22:23.280 So this is percentage of gross revenue with some exclusions. 00:22:23.280 --> 00:22:27.600 Electric currently pays 19.4 million to the general fund. 00:22:27.600 --> 00:22:31.140 Water pays 1.5, and then wastewater pays a million. 00:22:31.140 --> 00:22:34.900 And that is it. 00:22:34.900 --> 00:22:37.800 Very short and sweet. 00:22:37.800 --> 00:22:39.800 - Questions. 00:22:39.800 --> 00:22:49.700 - No, Mr. Cheek, the 6% was increased from 3.5% to 6% 00:22:49.700 --> 00:22:51.240 in April 2020. 00:22:51.240 --> 00:22:52.820 So during the COVID pandemic. 00:22:54.280 --> 00:22:59.280 - That's always a tough balancing act between, you know, 00:22:59.280 --> 00:23:02.800 what do you charge for your rate of return and investment? 00:23:02.800 --> 00:23:03.640 It's difficult. 00:23:03.640 --> 00:23:08.000 But that was increased here in COVID. 00:23:08.000 --> 00:23:10.260 All right, do we have a motion to approve 00:23:10.260 --> 00:23:12.300 if there are no other questions? 00:23:12.300 --> 00:23:13.960 Mr. Beck is moving approval. 00:23:13.960 --> 00:23:15.880 Do we have a second? 00:23:15.880 --> 00:23:20.560 Mr. Cheek seconds, all in favor say aye. 00:23:20.560 --> 00:23:21.400 - Aye. 00:23:21.400 --> 00:23:22.240 - Opposed? 00:23:24.200 --> 00:23:25.440 - Abstaining. 00:23:25.440 --> 00:23:27.440 - Abstaining, Mr. Rybeck is abstaining. 00:23:27.440 --> 00:23:28.280 Okay. 00:23:28.280 --> 00:23:32.920 Next item is consider recommending the adoption 00:23:32.920 --> 00:23:35.680 of an ordinance through the lower Colorado River 00:23:35.680 --> 00:23:38.900 authority contract, number 5343. 00:23:38.900 --> 00:23:46.140 For $16 million. 00:23:46.140 --> 00:23:51.060 - I'm gonna try to go as fast as Nick did. 00:23:52.800 --> 00:23:54.320 Just kidding. 00:23:54.320 --> 00:23:56.160 My name is Randy Key. 00:23:56.160 --> 00:23:58.500 I'm an electric engineering supervisor at DME. 00:23:58.500 --> 00:24:01.860 Let's see here. 00:24:01.860 --> 00:24:06.560 Okay, this is for the LCRA contract, 00:24:06.560 --> 00:24:08.320 lower Colorado River authority. 00:24:08.320 --> 00:24:10.040 This is a co-op contract. 00:24:10.040 --> 00:24:17.600 Okay, this contract intends to supply low usage, 00:24:17.600 --> 00:24:19.880 one time buy and specialty items not covered 00:24:19.880 --> 00:24:21.520 by any current city agreements. 00:24:22.560 --> 00:24:24.360 The city will also be able to use this contract 00:24:24.360 --> 00:24:26.400 to purchase a variety of electric items, 00:24:26.400 --> 00:24:29.320 such as wire, cable, hardware, connector, 00:24:29.320 --> 00:24:32.100 pretty much any electric utility item. 00:24:32.100 --> 00:24:41.520 Right here, went over some of the categories 00:24:41.520 --> 00:24:47.280 and estimations that we have for wire, 00:24:47.280 --> 00:24:51.280 two million cable, two million components, 00:24:51.280 --> 00:24:54.640 eight million, which is kind of all-encompassing, 00:24:54.640 --> 00:24:57.000 hardware, four million, and for three years 00:24:57.000 --> 00:24:58.600 for a total of $16 million. 00:24:58.600 --> 00:25:07.320 Why we need the extra purchasing power. 00:25:07.320 --> 00:25:09.560 The purchase of these supplies is necessary 00:25:09.560 --> 00:25:11.920 so that DME can construct, operate, maintain, 00:25:11.920 --> 00:25:14.880 overhead, underground electric utilities, 00:25:14.880 --> 00:25:18.160 provide electric service to new and existing customers. 00:25:18.160 --> 00:25:20.600 Items are purchased as needed by the warehouse 00:25:20.600 --> 00:25:22.020 as well as DME. 00:25:22.020 --> 00:25:27.520 We can kind of use this contract as an emergency once. 00:25:27.520 --> 00:25:31.200 What we have seen in the past year 00:25:31.200 --> 00:25:36.200 with price increases is tremendous, 00:25:36.200 --> 00:25:39.860 which means that our current contracts, 00:25:39.860 --> 00:25:46.120 they're being used up way faster than we ever anticipated, 00:25:46.120 --> 00:25:48.320 and that's what this contract is mainly for. 00:25:48.320 --> 00:25:51.680 And for the one-time buys and the specialty items 00:25:51.680 --> 00:25:53.920 that we don't necessarily have on contract. 00:25:53.920 --> 00:25:56.960 - Are we having supply chain issues 00:25:56.960 --> 00:25:58.880 with a lot of these components also? 00:25:58.880 --> 00:26:00.920 - Yes. - Okay, all right. 00:26:00.920 --> 00:26:02.000 - Very much so. 00:26:02.000 --> 00:26:06.800 For instance, transformers that were about 12-week weight 00:26:06.800 --> 00:26:08.500 were almost at two years. 00:26:08.500 --> 00:26:10.040 - Oh, no. 00:26:10.040 --> 00:26:12.380 - And that goes, it's industry-wide. 00:26:12.380 --> 00:26:13.720 It's not just transformers. 00:26:13.720 --> 00:26:16.800 It's our PVC, it's pretty much everything, 00:26:16.800 --> 00:26:20.200 PVC pedestals, wire, cable, it's a lot. 00:26:20.200 --> 00:26:21.400 - Mr. Beck, go ahead. 00:26:21.400 --> 00:26:22.360 - Thank you. 00:26:22.360 --> 00:26:23.720 When you say one-time buy now, 00:26:23.720 --> 00:26:25.240 are you talking about this is in place 00:26:25.240 --> 00:26:29.120 for this fiscal year, or it's kind of an ongoing thing, 00:26:29.120 --> 00:26:32.840 but when we do do it, we only do it one time? 00:26:32.840 --> 00:26:34.160 - It's gonna be ongoing. 00:26:34.160 --> 00:26:36.160 It depends on the actual project. 00:26:36.160 --> 00:26:39.960 We do have a few fairly large projects 00:26:39.960 --> 00:26:43.920 that could encompass some one-time buys. 00:26:43.920 --> 00:26:46.720 So this is not something we're gonna review every year. 00:26:46.720 --> 00:26:49.280 This is to kind of approve it, 00:26:49.280 --> 00:26:52.360 and it'll be kind of an ongoing, as needed. 00:26:52.360 --> 00:26:53.200 - I believe it's a three-year. 00:26:53.200 --> 00:26:55.260 - Mr. Beck, this is a three-year contract. 00:26:55.260 --> 00:26:56.100 - Okay. 00:26:56.100 --> 00:26:58.840 - With that $16 million authorization, 00:26:58.840 --> 00:27:01.440 we're only gonna use it if we need it. 00:27:01.440 --> 00:27:04.060 And so if we don't need it, it expires in three years. 00:27:04.060 --> 00:27:07.000 We'll come back, and we renew it if we need to. 00:27:07.000 --> 00:27:07.840 - Okay. 00:27:07.840 --> 00:27:10.440 - I will tell you, we certainly don't wanna create 00:27:10.440 --> 00:27:12.880 any kind of panic, right, with these long lead times. 00:27:12.880 --> 00:27:15.040 So something that we're doing internally, 00:27:15.040 --> 00:27:16.320 both at DME and in conjunction 00:27:16.320 --> 00:27:17.760 with our centralized warehouse, 00:27:17.760 --> 00:27:20.760 is trying to identify the amount of inventory 00:27:20.760 --> 00:27:24.320 that we need to serve our current existing customers. 00:27:24.320 --> 00:27:27.120 And so the plan would then be that any lead times, 00:27:27.120 --> 00:27:30.020 once we've exhausted some of that excess inventory, 00:27:30.020 --> 00:27:32.280 is to begin to push that out to new development, 00:27:32.280 --> 00:27:33.440 if we need to. 00:27:33.440 --> 00:27:34.560 Again, that's our current plan. 00:27:34.560 --> 00:27:35.880 That's what we're planning for. 00:27:35.880 --> 00:27:37.800 But we wanna make sure that we preserve 00:27:37.800 --> 00:27:40.480 our existing inventory for our existing customers, 00:27:40.480 --> 00:27:43.360 and that they don't experience any outages 00:27:43.360 --> 00:27:46.540 as a result of any long lead times. 00:27:46.540 --> 00:27:47.380 - Good, thank you. 00:27:47.380 --> 00:27:48.840 - And this is just really allowing us 00:27:48.840 --> 00:27:52.600 to leverage some opportunities with Lower Colorado. 00:27:52.600 --> 00:27:54.760 - Absolutely, this is just an additional contract 00:27:54.760 --> 00:27:56.900 that we'll have in place in case we need it. 00:27:56.900 --> 00:27:57.740 - Yeah. 00:27:57.740 --> 00:27:58.560 - True. 00:27:58.560 --> 00:28:01.320 - And it saves us in the bidding process. 00:28:01.320 --> 00:28:03.520 Saves us time in the bidding process. 00:28:03.520 --> 00:28:04.440 - Absolutely. 00:28:04.440 --> 00:28:05.480 - Yes. 00:28:05.480 --> 00:28:08.420 - I just wanted to find out that you have some numbers there. 00:28:08.420 --> 00:28:10.160 So obviously you made some projections 00:28:10.160 --> 00:28:14.240 about your requirement as you see them going forward. 00:28:14.240 --> 00:28:17.560 Is that reasonably correct for me to assume? 00:28:17.560 --> 00:28:19.400 - You're saying about the numbers for lead times, 00:28:19.400 --> 00:28:21.360 or numbers for price increases? 00:28:21.360 --> 00:28:24.640 - The dollar amounts in total over the period. 00:28:24.640 --> 00:28:26.720 - For wire, cable. 00:28:26.720 --> 00:28:28.680 - Oh, for the wire and the cable. 00:28:28.680 --> 00:28:30.960 That was just, that's based upon, 00:28:30.960 --> 00:28:34.680 it's really based upon just the upcoming projects, 00:28:34.680 --> 00:28:38.560 and what could, it's a complete estimation. 00:28:38.560 --> 00:28:43.560 So what I do have is numbers for the lead times 00:28:43.560 --> 00:28:46.560 and price increases of the equipment. 00:28:46.560 --> 00:28:49.040 And so, yes sir. 00:28:49.040 --> 00:28:51.460 - Okay, I don't know if that answered my question, 00:28:51.460 --> 00:28:52.300 but I'll take it. 00:28:52.300 --> 00:28:56.460 - Well, so if you're asking about your question, 00:28:56.460 --> 00:29:00.760 you're asking for what we're gonna spend the 16 million on? 00:29:00.760 --> 00:29:02.600 Is that, was that your question? 00:29:02.600 --> 00:29:04.440 - You had some specific dollar amounts, 00:29:04.440 --> 00:29:06.700 and I'm presuming they were based on something, 00:29:06.700 --> 00:29:08.840 and you're based on projections of things 00:29:08.840 --> 00:29:10.880 you expect to need over the next two years. 00:29:10.880 --> 00:29:13.860 - Yeah, Mr. Ryback, the reason for the dollar amount 00:29:13.860 --> 00:29:16.540 is really attributable to the price increases 00:29:16.540 --> 00:29:17.640 that we're seeing. 00:29:17.640 --> 00:29:19.660 For some of our normal distribution transformers, 00:29:19.660 --> 00:29:23.560 we're seeing pricing increases up to 250%, right? 00:29:23.560 --> 00:29:28.420 And so again, so the contracts that Randy has referenced, 00:29:28.420 --> 00:29:31.280 our existing contracts, the dollar values of those contracts, 00:29:31.280 --> 00:29:33.480 we're expending those dollars a lot quicker. 00:29:33.480 --> 00:29:36.040 - Oh, that part I got, yes, I was clear about that. 00:29:36.040 --> 00:29:39.880 I was just curious what these dollars were tied to, 00:29:39.880 --> 00:29:42.600 and if you are projecting A, replacing equipment 00:29:42.600 --> 00:29:45.920 you have on hand, or B, new projects 00:29:45.920 --> 00:29:47.280 that you see coming down the road 00:29:47.280 --> 00:29:49.160 that will require equipment. 00:29:49.160 --> 00:29:53.360 - It's really the new projects that are coming online, 00:29:53.360 --> 00:29:54.800 and they're already in the pipeline. 00:29:54.800 --> 00:29:56.960 - All right, so do you have an existing inventory 00:29:56.960 --> 00:30:00.960 of some of these basic, constantly reused products 00:30:00.960 --> 00:30:04.080 like cable, transformers, et cetera? 00:30:04.080 --> 00:30:04.960 - Yes, absolutely. 00:30:04.960 --> 00:30:06.160 - Okay, thank you. 00:30:06.160 --> 00:30:09.040 - Other questions? 00:30:09.040 --> 00:30:10.560 Oh, go ahead, Mr. Taylor. 00:30:10.560 --> 00:30:12.080 - Thank you. 00:30:12.080 --> 00:30:13.720 So when we talk about projects, 00:30:13.720 --> 00:30:18.720 are these capital projects, or are these kind of O&M, 00:30:18.720 --> 00:30:21.720 like updating existing distribution? 00:30:21.720 --> 00:30:22.680 - Majority capital. 00:30:22.680 --> 00:30:25.280 I mean, there is maintenance projects as well, 00:30:25.280 --> 00:30:26.540 but majority capital. 00:30:26.540 --> 00:30:29.960 - And so in this case, we might have a new substation, 00:30:29.960 --> 00:30:32.640 $20 million project, it was approved a year ago, 00:30:32.640 --> 00:30:34.080 it's three years construction. 00:30:35.600 --> 00:30:36.800 Copper prices are high. 00:30:36.800 --> 00:30:37.640 - Yes, sir. 00:30:37.640 --> 00:30:40.200 - And so a million of this is gonna go to 00:30:40.200 --> 00:30:43.920 increased material costs for that project? 00:30:43.920 --> 00:30:46.720 - It would just depend, depend on the contracts 00:30:46.720 --> 00:30:49.120 and how much we have in stock. 00:30:49.120 --> 00:30:54.120 So this is mainly for what I would, okay. 00:30:54.120 --> 00:31:00.680 - I'm sorry, Jerry Filler, engineering manager for DME. 00:31:00.680 --> 00:31:03.200 The substation project that I think you're referring to, 00:31:03.200 --> 00:31:05.720 it's under its own contract and the contractor's required 00:31:05.720 --> 00:31:07.600 to provide all the materials. 00:31:07.600 --> 00:31:09.200 So the money that we have for this contract 00:31:09.200 --> 00:31:11.600 will not be going to that substation. 00:31:11.600 --> 00:31:13.560 This is mainly for distribution projects, 00:31:13.560 --> 00:31:15.440 mostly capital, some maintenance functions 00:31:15.440 --> 00:31:18.080 that we have come up and it's above and beyond 00:31:18.080 --> 00:31:20.840 what we're already doing, as Mr. Puente pointed out. 00:31:20.840 --> 00:31:26.840 We have tried to identify a standard level of materials 00:31:26.840 --> 00:31:29.520 to handle the customers that we have now. 00:31:29.520 --> 00:31:32.520 And so things happen, storms come through, 00:31:32.520 --> 00:31:34.200 et cetera, et cetera. 00:31:34.200 --> 00:31:36.840 So this allows us to go buy additional materials 00:31:36.840 --> 00:31:38.280 if we need to. 00:31:38.280 --> 00:31:39.920 Doesn't mean that we're still not gonna come back later 00:31:39.920 --> 00:31:42.280 and come in front of you guys to get contracts 00:31:42.280 --> 00:31:44.400 for cable, wire, transformers. 00:31:44.400 --> 00:31:46.240 Gonna see a big one for transformers here 00:31:46.240 --> 00:31:48.160 in a couple of weeks, probably. 00:31:48.160 --> 00:31:50.880 But this one is just basically a help all 00:31:50.880 --> 00:31:52.680 to make sure that we keep everything 00:31:52.680 --> 00:31:54.680 under control that we have. 00:31:54.680 --> 00:31:56.080 - Okay, so this would not be used 00:31:56.080 --> 00:31:58.760 for kind of the large capital projects 00:31:58.760 --> 00:32:00.760 that have their own contracts. 00:32:00.760 --> 00:32:05.760 This would be used for smaller or kind of O&M type work? 00:32:05.760 --> 00:32:08.720 - Substations are typically under a separate contract. 00:32:08.720 --> 00:32:10.040 So those are the big ones. 00:32:10.040 --> 00:32:13.280 - Substations are so big that the contractor 00:32:13.280 --> 00:32:14.760 provides everything. - Pretty much, yeah. 00:32:14.760 --> 00:32:16.360 - Maybe some smaller stuff you might have. 00:32:16.360 --> 00:32:18.000 We might have a million dollar project 00:32:18.000 --> 00:32:19.880 on upgrading something. 00:32:19.880 --> 00:32:21.240 - Yeah, real widenings. 00:32:21.240 --> 00:32:22.720 That would be a distribution project 00:32:22.720 --> 00:32:25.480 and if we needed materials and we need to use this contract, 00:32:25.480 --> 00:32:28.080 then this would make this contract available to us. 00:32:28.080 --> 00:32:32.480 - Okay, and then I was curious, electric components, 00:32:32.480 --> 00:32:37.480 I mean, is this only distributed or almost only distribution? 00:32:37.480 --> 00:32:38.960 - Distribution, yes, sir. 00:32:38.960 --> 00:32:42.360 - And so wires, poles, transformers? 00:32:42.360 --> 00:32:45.480 - Splicers, connections, it's all encompassing. 00:32:45.480 --> 00:32:47.560 - Okay, but like what you see driving down 00:32:47.560 --> 00:32:49.360 a residential neighborhood? - Yes, sir. 00:32:49.360 --> 00:32:51.960 - You know, City Street, okay, thank you. 00:32:51.960 --> 00:32:54.360 - Did I see another question on this side? 00:32:55.320 --> 00:32:58.760 No, no, any other questions? 00:32:58.760 --> 00:33:02.520 All right, do we have a motion to approve 00:33:02.520 --> 00:33:04.760 the contract with Lower Colorado River Authority 00:33:04.760 --> 00:33:07.960 contract number 5343? 00:33:07.960 --> 00:33:14.200 Oh, Mr. Rybeka moved and Mr. Taylor seconded. 00:33:14.200 --> 00:33:15.640 All in favor say aye. 00:33:15.640 --> 00:33:16.680 - Aye. - Aye. 00:33:16.680 --> 00:33:17.840 - Carries, thank you. 00:33:17.840 --> 00:33:19.120 - Thank you very much. 00:33:19.120 --> 00:33:20.400 - Management reports. 00:33:20.400 --> 00:33:24.120 - So Madam Chair and members of the board, 00:33:24.120 --> 00:33:27.720 so for your future items on your agenda, 00:33:27.720 --> 00:33:31.080 we have a water rights modernization 00:33:31.080 --> 00:33:35.640 and one water contract is coming to you on the 26th. 00:33:35.640 --> 00:33:40.080 And then we did push back the Greensense Incentives Program 00:33:40.080 --> 00:33:42.260 out to October 24th. 00:33:42.260 --> 00:33:45.120 I will tell you, we did go to the sustainability committee, 00:33:45.120 --> 00:33:47.720 I did forward to you the various presentations, 00:33:47.720 --> 00:33:49.720 there's also some additional documentation. 00:33:49.720 --> 00:33:51.880 There was a number of questions that came up 00:33:51.880 --> 00:33:54.680 here in that committee and so we've been asked 00:33:54.680 --> 00:33:57.200 to come back to the committee at the end of September. 00:33:57.200 --> 00:33:59.600 We'll be doing that, working through that process, 00:33:59.600 --> 00:34:00.960 getting their recommendation. 00:34:00.960 --> 00:34:03.600 Once we have that, we will bring all that to you 00:34:03.600 --> 00:34:06.880 for discussion and then ultimately we'll go back 00:34:06.880 --> 00:34:11.120 to the council probably sometime in November at this point. 00:34:11.120 --> 00:34:13.280 You know, considering where we are in the fiscal year, 00:34:13.280 --> 00:34:15.540 what I've told the committee, I'll tell you is that 00:34:15.540 --> 00:34:19.240 really there's no rush at this point to make any changes. 00:34:19.240 --> 00:34:22.080 We have plenty of time and so that's why we're kind of 00:34:22.080 --> 00:34:23.460 tapping the brakes a little bit, 00:34:23.460 --> 00:34:25.320 making sure that we answer everyone's questions 00:34:25.320 --> 00:34:27.560 and that we get the right information out there 00:34:27.560 --> 00:34:29.800 to ultimately get a good solid recommendation 00:34:29.800 --> 00:34:32.600 from both groups before we go to the council. 00:34:32.600 --> 00:34:36.560 And then on the new business action matrix, 00:34:36.560 --> 00:34:40.800 obviously those two items are items that we've included 00:34:40.800 --> 00:34:43.560 in that presentation and discussion. 00:34:43.560 --> 00:34:46.160 And so we hope to be able to get that wrapped up 00:34:46.160 --> 00:34:49.200 when we come to you as well and then clean that up. 00:34:49.200 --> 00:34:51.880 So I'm happy to answer any questions that you may have 00:34:51.880 --> 00:34:54.000 on any of that, but that concludes 00:34:54.000 --> 00:34:56.120 the information I have for you today. 00:34:56.120 --> 00:34:57.120 - Questions? 00:34:57.120 --> 00:34:57.960 - One. 00:34:57.960 --> 00:34:59.620 - Yeah, go ahead. 00:34:59.620 --> 00:35:00.560 - Thank you, Chair. 00:35:00.560 --> 00:35:03.760 So I reviewed the Greensense presentation 00:35:03.760 --> 00:35:07.160 to the sustainability in the sustainability agenda 00:35:07.160 --> 00:35:11.160 and I couldn't find reference to savings 00:35:11.160 --> 00:35:17.080 from decreased average peak distribution load. 00:35:17.080 --> 00:35:20.360 And I've also separately been reading 00:35:20.360 --> 00:35:24.400 about Austin Energy's reforms to their solar incentives 00:35:24.400 --> 00:35:28.920 and their solar electric rate, their buyback rate. 00:35:28.920 --> 00:35:33.280 And I was wondering when we get that presentation, 00:35:33.280 --> 00:35:38.280 if we could see distribution level O&M 00:35:38.280 --> 00:35:43.960 and capital savings from having generation 00:35:43.960 --> 00:35:45.420 on the distribution lines. 00:35:45.420 --> 00:35:48.600 And then also a comparison of something like Austin 00:35:48.600 --> 00:35:52.480 where their value of solar is something like 9.8 cents. 00:35:52.480 --> 00:35:56.400 Just to compare, 'cause in the presentation, 00:35:56.400 --> 00:35:59.560 it seemed to be just talking about this kind of 2 cents, 00:35:59.560 --> 00:36:03.200 $20 a megawatt offset wholesale purchase. 00:36:03.200 --> 00:36:06.600 But I would like to compare the full cost 00:36:06.600 --> 00:36:09.240 all the way from not just the wholesale power, 00:36:09.240 --> 00:36:12.720 but the transmission, distribution, capital savings, 00:36:12.720 --> 00:36:17.720 extended life of O&M and lower O&M on distribution equipment. 00:36:17.720 --> 00:36:19.600 - I have a question too. 00:36:19.600 --> 00:36:20.440 - Go ahead, Larry. 00:36:20.440 --> 00:36:22.280 - Good, good start there. 00:36:22.280 --> 00:36:24.000 I too watched the presentation 00:36:24.000 --> 00:36:29.000 and I didn't see an answer that explained, 00:36:29.000 --> 00:36:34.560 said that we pay, that DME pays PV homes, businesses, 00:36:34.560 --> 00:36:41.960 three times the rate when the energy they produce 00:36:41.960 --> 00:36:44.840 back into the system, then y'all pay aircott. 00:36:44.840 --> 00:36:48.400 And I, why is that, how does that happen? 00:36:48.400 --> 00:36:53.840 - Yeah, I guess I'm not following the, 00:36:53.840 --> 00:36:54.840 that we pay aircott. 00:36:54.840 --> 00:36:57.200 I think, I think, yeah, I think we'll-- 00:36:57.200 --> 00:36:58.600 - It was three times higher the rate 00:36:58.600 --> 00:37:01.280 than we were paying somebody. 00:37:01.280 --> 00:37:03.960 - So the average, so the average cost 00:37:03.960 --> 00:37:07.360 from buying electricity from the grid 00:37:07.360 --> 00:37:12.360 is about $18, $20 a megawatt hour, right? 00:37:12.360 --> 00:37:17.760 So that's about a 1.8 cents, a two cents type of average 00:37:17.760 --> 00:37:20.960 on a per kilowatt basis, but yet offered PV 00:37:20.960 --> 00:37:23.200 when we're paying them is 10 cents. 00:37:23.200 --> 00:37:26.680 So we're 10 cents on a per kilowatt basis. 00:37:26.680 --> 00:37:29.520 And that's kind of the comparison that we've made. 00:37:29.520 --> 00:37:31.000 Again, I think the committees, 00:37:31.000 --> 00:37:32.760 it certainly has asked a number of questions, 00:37:32.760 --> 00:37:33.960 certainly along those lines, 00:37:33.960 --> 00:37:37.120 and we're compiling responses for that. 00:37:37.120 --> 00:37:39.560 Also, there was an additional ISR 00:37:39.560 --> 00:37:41.560 that wasn't provided to you, 00:37:41.560 --> 00:37:43.320 that was provided to the committee 00:37:43.320 --> 00:37:47.360 that we'll get to that also explains some of the issues 00:37:47.360 --> 00:37:50.760 that are going on, the impacts on the overall load, 00:37:50.760 --> 00:37:53.120 what it does to the transmission cost of service 00:37:53.120 --> 00:37:55.040 and the force CP impacts. 00:37:55.040 --> 00:37:57.800 And so all of that will be coming to you. 00:37:57.800 --> 00:38:00.160 And so, but I think that's what you're referencing 00:38:00.160 --> 00:38:04.200 is how that compares to what we're actually buying power 00:38:04.200 --> 00:38:05.680 from the market. 00:38:05.680 --> 00:38:08.200 There's a huge disparity between the two, 00:38:08.200 --> 00:38:12.440 along with the fact that when you're net zero billing 00:38:12.440 --> 00:38:16.560 a customer, you're not recovering any of your fixed charges 00:38:16.560 --> 00:38:19.200 to serve that customer when their power 00:38:19.200 --> 00:38:21.240 is not being produced, you know, 00:38:21.240 --> 00:38:23.400 usually in the evenings, at night, 00:38:23.400 --> 00:38:25.480 and in the mornings as well. 00:38:25.480 --> 00:38:27.680 - All right, I'm hoping when we do bring this up, 00:38:27.680 --> 00:38:29.720 that can be something we can look at, 00:38:29.720 --> 00:38:32.840 that can be adjusted, 'cause I got skin in the game, 00:38:32.840 --> 00:38:35.600 and I don't mind giving you back my power, 00:38:35.600 --> 00:38:39.240 'cause I've got one of those systems that's probably too big, 00:38:39.240 --> 00:38:41.800 but I know you're trying to cover your fixed costs, 00:38:41.800 --> 00:38:46.800 and if we can just be credited with what we use 00:38:46.800 --> 00:38:49.400 and then give back to y'all, 00:38:49.400 --> 00:38:50.600 I don't know why we can't do that, 00:38:50.600 --> 00:38:53.360 but something to consider when we bring that up. 00:38:53.360 --> 00:38:54.200 Thank you. 00:38:54.200 --> 00:38:57.720 - Other questions? 00:38:57.720 --> 00:39:01.600 Concluding items, does a board member wish 00:39:01.600 --> 00:39:04.800 to have any items added to a future agenda, 00:39:04.800 --> 00:39:07.640 or have any further comments to make to the public? 00:39:07.640 --> 00:39:12.840 Okay, seeing none, it's 9.40, and we're adjourned.