1
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 I know that doesn't say it's nine o'clock, but she just gave me the countdown.

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 So it's nine o'clock and we have a quorum.

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00:00:10,760 --> 00:00:13,600
 So we're called to order the public utilities board meeting for

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00:00:13,600 --> 00:00:17,440
 the city of Denton on Monday, May 22nd, 2023.

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00:00:17,440 --> 00:00:20,820
 The first item is presentations from members of the public.

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00:00:20,820 --> 00:00:24,000
 There's anybody from the public wish to speak?

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 I see none.

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00:00:25,800 --> 00:00:27,160
 So we'll close that out.

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00:00:27,160 --> 00:00:29,300
 The next item is the consent agenda.

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00:00:29,300 --> 00:00:32,400
 Does any board member wish to pull either item A or B?

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 I see none.

12
00:00:35,120 --> 00:00:37,520
 Do we have a motion to approve the consent agenda?

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00:00:37,520 --> 00:00:42,000
 Moved by Mr. Rybeck, seconded by Barbara.

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 All in favor say aye.

15
00:00:44,560 --> 00:00:46,160
 >> Aye. >> Aye.

16
00:00:46,160 --> 00:00:52,080
 >> Okay, next item is consideration approval of the May 8th, 2023 minutes.

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 Are there any corrections or changes?

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00:00:55,520 --> 00:00:56,080
 No?

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00:00:56,080 --> 00:00:57,200
 Do we have a motion to approve?

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00:00:57,200 --> 00:00:58,600
 >> So moved.

21
00:00:58,600 --> 00:01:00,880
 >> Mr. Taylor moves, do we have a second?

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00:01:00,880 --> 00:01:03,320
 Mr. Block, I'm still remembering your name.

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00:01:03,320 --> 00:01:04,480
 Sorry about that.

24
00:01:04,480 --> 00:01:06,040
 All in favor say aye.

25
00:01:06,040 --> 00:01:06,720
 >> Aye. >> Aye.

26
00:01:06,720 --> 00:01:09,280
 Carries, good thing, Billy already signed him.

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00:01:09,280 --> 00:01:13,280
 The next two items we're going to pull together, A, B, and C.

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00:01:13,280 --> 00:01:27,800
 >> Good morning, I am Randy Klingle, the Treasury Manager here with the city of

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00:01:27,800 --> 00:01:29,240
 Denton and the Finance Department.

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00:01:29,240 --> 00:01:33,760
 I have a brief presentation regarding the upcoming bond sale.

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00:01:33,760 --> 00:01:37,080
 So this is your bond ordinance in preparation for that.

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00:01:37,080 --> 00:01:44,680
 I came to you a couple of months ago with a notice of intent, which is required by law.

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00:01:44,680 --> 00:01:46,880
 And after your recommendation, I did take that to council.

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00:01:46,880 --> 00:01:52,440
 So the items that we took to council for notice of intent were completed on April 4th.

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00:01:52,440 --> 00:01:58,160
 And as stated in the requirements, we posted our notice of intent in the Denton Record

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00:01:58,160 --> 00:02:03,700
 Chronicle on April 13th and April 20th, which meets the criteria of publicizing and

37
00:02:03,700 --> 00:02:07,660
 having this bond ordinance on the 46th day after the 13th.

38
00:02:07,660 --> 00:02:11,160
 By the time I've received your recommendation here, hopefully today,

39
00:02:11,160 --> 00:02:15,360
 I'll go to the council on June 6th, and so that'll actually be 54 days.

40
00:02:15,360 --> 00:02:18,360
 So we'll be within all the rules and regulations of the notice of intent.

41
00:02:20,520 --> 00:02:26,980
 So for the certificates of obligation for the bond sale, we have $158,500,000,

42
00:02:26,980 --> 00:02:31,200
 which includes all the projects for the COs plus some issuance costs of about

43
00:02:31,200 --> 00:02:32,520
 $1 million for this year.

44
00:02:32,520 --> 00:02:40,240
 We'll go high level over the projects and note that I'm just gonna give you the totals.

45
00:02:40,240 --> 00:02:43,760
 And on this slide presentation, what I've done is give you two columns,

46
00:02:43,760 --> 00:02:47,680
 the notice of intent, which you recommended in the council approved last time.

47
00:02:47,680 --> 00:02:51,000
 And then the bond sale dollar amounts, which we will be taking forward on this

48
00:02:51,000 --> 00:02:52,380
 bond ordinance today.

49
00:02:52,380 --> 00:02:55,880
 And it just shows you the difference, if any, of where we went through that process.

50
00:02:55,880 --> 00:02:59,680
 And during all the timelines and the milestones that we hit for

51
00:02:59,680 --> 00:03:05,240
 the bond sale, when we come to that in June, the departments analyze their projects,

52
00:03:05,240 --> 00:03:08,320
 how much money they have, what product availability they have.

53
00:03:08,320 --> 00:03:12,600
 So each timeline that I come to you with a new project timeline and

54
00:03:12,600 --> 00:03:16,840
 a new dollar amount, they have gone through the task of looking to see what

55
00:03:16,840 --> 00:03:19,200
 they can do, how much they can handle.

56
00:03:19,200 --> 00:03:21,720
 And if they can't, they'll lower their number,

57
00:03:21,720 --> 00:03:24,440
 which most of the utilities did now for the bond ordinance.

58
00:03:24,440 --> 00:03:27,680
 And then it's not that those projects go away or that work's not gonna be done,

59
00:03:27,680 --> 00:03:30,000
 it's probably just gonna be done in future years.

60
00:03:30,000 --> 00:03:32,560
 So that'll be the theme for most of the utilities.

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00:03:32,560 --> 00:03:35,920
 But for solid waste, you see that they came in at notice of intent and

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00:03:35,920 --> 00:03:38,000
 bond sale, even at the $16 million.

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00:03:38,000 --> 00:03:45,640
 The water department had a reduction of about $12 million since the last time I

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00:03:45,640 --> 00:03:51,360
 was here a couple of months ago, so they are $21,188,000.

65
00:03:51,360 --> 00:03:55,920
 The wastewater department has a reduction of almost $16.5 million, and

66
00:03:55,920 --> 00:04:01,000
 you can see the line items here in specific orders of how they reduce their budget.

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00:04:01,000 --> 00:04:04,200
 Those are also in your backup in your AIS as well.

68
00:04:04,200 --> 00:04:07,680
 And we also have departments here if you have any further questions specific to

69
00:04:07,680 --> 00:04:09,000
 the project lines or anything.

70
00:04:09,000 --> 00:04:15,320
 The electric department, from notice of intent, reduced theirs by almost $32 million.

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00:04:15,320 --> 00:04:17,680
 You can see that the transformers are still popular, so

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00:04:17,680 --> 00:04:22,960
 those stayed pretty close to a budget and to, well, actually to notice of intent.

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00:04:22,960 --> 00:04:25,680
 And then just had some play within other line items there.

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00:04:25,680 --> 00:04:30,240
 So the electrics bond sale ordinance item is $70 million even.

75
00:04:30,240 --> 00:04:38,440
 For solid waste and utilities, the total COs only is 123,784,000.

76
00:04:38,440 --> 00:04:42,680
 But in addition to the CO sale,

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00:04:42,680 --> 00:04:46,360
 we have a bond sale that's also the general obligation portion.

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00:04:46,360 --> 00:04:49,560
 And the reason I'm bringing that to you today is because of the refunding

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00:04:49,560 --> 00:04:50,320
 opportunities.

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 So we will refund money when we can, and when they're callable,

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00:04:53,560 --> 00:04:55,080
 we are able to do so.

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00:04:55,080 --> 00:04:57,680
 So for the upcoming bond sale, the 2012 and

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00:04:57,680 --> 00:05:04,080
 the 2013 series are eligible, which include utility department and funds.

84
00:05:04,080 --> 00:05:11,780
 So currently, we're looking at refunding 45,560,000

85
00:05:11,780 --> 00:05:15,200
 in par amount on debt that we currently have.

86
00:05:15,200 --> 00:05:20,120
 And that will give us a projected one time saving of $1.4 million currently.

87
00:05:20,120 --> 00:05:23,800
 And that $1.4 million, as you can see, is allocated out here on the bottom of my

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00:05:23,800 --> 00:05:28,440
 slide regarding what utility or what fund that includes.

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00:05:28,440 --> 00:05:31,280
 So that is where we are currently in those savings.

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00:05:31,280 --> 00:05:33,460
 And we won't go to sell until next month, so

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00:05:33,460 --> 00:05:37,240
 that could have a little bit of variation, but hoping for an increase.

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00:05:37,240 --> 00:05:42,000
 But we'll just have to wait until that pans out in June.

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 So my next step with your recommendation,

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00:05:43,480 --> 00:05:46,960
 I'll go to council on June 6th to execute this bond ordinances.

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00:05:46,960 --> 00:05:50,840
 Then we'll have a sale date for the bond sale, third week of June.

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00:05:50,840 --> 00:05:57,920
 Then after that, the city will receive their actual proceeds on July 21st.

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00:05:57,920 --> 00:05:59,680
 Any questions?

98
00:05:59,680 --> 00:06:01,800
 Yes, ma'am.

99
00:06:01,800 --> 00:06:06,240
 >> Talk to me about the cost to issue bonds.

100
00:06:06,240 --> 00:06:06,960
 >> What's in that?

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00:06:06,960 --> 00:06:11,400
 The cost issue bonds includes our outside council and our outside FA.

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00:06:11,400 --> 00:06:15,400
 And then there's also some, in this actual issuance cost line,

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00:06:15,400 --> 00:06:19,000
 is some movement for flexibility and pricing once we go out in the market.

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00:06:19,000 --> 00:06:20,040
 >> Okay, thank you.

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00:06:20,040 --> 00:06:22,540
 >> Mm-hm.

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 >> Question, in general terms, how are these departments able to reduce their

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 requests?

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 Are these projects eliminated?

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 Are they put off?

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 Are they covered under something else?

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 Each milestone, they have a conversation with their own department as well as

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 the budget team and see what they can handle currently, physically able to do,

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 and what products and what availability they have.

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 And also, what do they have possibly in cash reserves or

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 savings from other things, and then what they physically can do.

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 So some of those items are not going away, they're just gonna fund them later.

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 So you may see the same list that they went from notice of intent to bond sale to

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 flat to nothing, next year you'll see a number there.

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 So I'll just push it out until they get the product availability and

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 the time to do those.

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 >> Thank you.

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 >> Yes, sir.

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 >> Your turn, go ahead.

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 >> There's been much talk in the news recently about inflation and interest rates.

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 You're showing about a 2.75% interest rate.

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 Is that where the municipal bond or market is right now?

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 >> The 2.75 here is just on the refunding portion.

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 The debt, the new debt that we're bringing on, most of the utility debt is 20-year debt,

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 and the portion of utilities for the electric is 30-year debt.

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 So the first 15 years of this debt is at 5%, and

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 the outlying years up to 30 is down at 4%.

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 >> Thank you.

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 >> Questions, okay, do we have a motion to approve items B and C?

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 >> Did you say B and C or just B and C?

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 >> B and C.

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 >> Okay.

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 >> Did I say A?

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 >> No, no, no.

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 >> All right.

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 >> I'm sick of the consent agenda, sorry.

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 >> So moved.

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 >> And a second?

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 >> Second.

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 >> Mr. Bybrook, seconds?

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 All in favor, say aye.

146
00:08:16,480 --> 00:08:17,400
 >> Aye. >> Aye.

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 >> Opposed?

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00:08:18,720 --> 00:08:24,480
 Carries, item D, professional services agreement with Kimley-Horn.

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 >> Good morning, David Brown, project manager, city and water utilities.

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 Excited to bring to you a expansion to 26MGD over at our Pecan Creek

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 water reclamation plant.

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00:08:46,120 --> 00:08:52,200
 So let's discuss, TCEQ requires 7590 rule that we talk about.

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00:08:52,200 --> 00:08:58,000
 At 75% of the permitted flow, the average flow, daily flow MGD that we have,

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 we are, once we reach that, we're required to go into design for an expansion.

155
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 At 90% when we reach that, we need to be in construction and ready to go.

156
00:09:08,120 --> 00:09:13,000
 So with that, let's look at the current, what's going on out there right now.

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 Currently, it's at 21MGD with a peak flow of 46MGD.

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 That's many gallons per day for a peak two hour flow.

159
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 That would be during rain events.

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00:09:23,600 --> 00:09:29,120
 We did file for an amendment to our TCEQ permit and we, it's administratively

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00:09:29,120 --> 00:09:33,680
 complete as of February 6th when this was, we started on this.

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00:09:33,680 --> 00:09:38,040
 And we anticipate we'll get that, those permits amended in the, in the summer.

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00:09:38,040 --> 00:09:44,600
 So, right now we have a master plan going on all over the city.

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 It didn't, as far as conveyance, it's also plants and wastewater.

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00:09:48,880 --> 00:09:54,360
 And part of that is a facility master plan at the concrete water reclamation plant.

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00:09:54,360 --> 00:10:00,200
 Part of that facility master plan, as you see, it recommends a 5MGD expansion of

167
00:10:00,200 --> 00:10:05,680
 MBR technology, which and solids handling and a disinfection improvements.

168
00:10:05,680 --> 00:10:10,040
 I might say this would be the first expansion as far as a new train,

169
00:10:10,040 --> 00:10:12,960
 cuz that's what there's called, there's a north and a south train.

170
00:10:12,960 --> 00:10:14,880
 You can see that on there.

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00:10:14,880 --> 00:10:19,320
 This would be the first expansion of a, of a new train over there since 1980.

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00:10:19,320 --> 00:10:27,600
 We've investigated, you know, membrane bioactive treatment process, which,

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00:10:27,600 --> 00:10:31,880
 you know, includes a bioactive treatment as well as a membrane

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00:10:31,880 --> 00:10:35,080
 that are very high quality effluent.

175
00:10:35,080 --> 00:10:39,000
 So you cut down some of the, some of the initial process, but

176
00:10:39,000 --> 00:10:42,720
 you're able to use a membrane technology to get a very,

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00:10:42,720 --> 00:10:45,520
 just a super-duper effluent.

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00:10:45,520 --> 00:10:51,400
 And also it allows for more treatment in that, in that area, in that train area.

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 It's also expandable, it's modularly expandable.

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00:10:54,080 --> 00:10:59,040
 So with that, this enhancement, you see there that it will,

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00:10:59,040 --> 00:11:02,880
 it'll help to purify the water that we're putting back into the system for

182
00:11:02,880 --> 00:11:07,240
 the city, the community, and those, that sensitive pecan creek stream that

183
00:11:07,240 --> 00:11:08,720
 eventually ends up in Lake Louisville.

184
00:11:10,760 --> 00:11:13,520
 With that, we also have a solids handling improvement.

185
00:11:13,520 --> 00:11:17,400
 Currently we utilize built, filter presses, and what that is,

186
00:11:17,400 --> 00:11:20,440
 that's for your press of your solids.

187
00:11:20,440 --> 00:11:23,960
 And then that goes also into, you know, our dino dirt.

188
00:11:23,960 --> 00:11:26,520
 That process feeds into the dino dirt.

189
00:11:26,520 --> 00:11:29,720
 Kimley Horne will partner with us to evaluate what is best for

190
00:11:29,720 --> 00:11:32,160
 our solids handling in this process.

191
00:11:32,160 --> 00:11:36,920
 It will be built out for the ultimate built out for the plant,

192
00:11:36,920 --> 00:11:39,520
 meaning it's not just for this expansion.

193
00:11:39,520 --> 00:11:43,920
 It's gonna handle the plant plus whatever else we need to put in.

194
00:11:43,920 --> 00:11:46,680
 This solids handling will be able to handle that.

195
00:11:46,680 --> 00:11:50,680
 Also that we have disinfection improvements.

196
00:11:50,680 --> 00:11:53,520
 Currently we use UV and it's a bottleneck there.

197
00:11:53,520 --> 00:11:57,440
 Everything goes into the UV system and then goes out to the stream.

198
00:11:57,440 --> 00:12:00,600
 So we're gonna look into that and also improve that.

199
00:12:00,600 --> 00:12:07,880
 So with that, we use the pre-qualified list 7574 to select Kimley Horne.

200
00:12:07,880 --> 00:12:11,800
 The staff recommends that we select Kimley Horne with a design contract.

201
00:12:11,800 --> 00:12:15,480
 This will be a design contract for $14,952 million.

202
00:12:15,480 --> 00:12:16,680
 Anybody have any questions?

203
00:12:16,680 --> 00:12:18,720
 >> Questions?

204
00:12:18,720 --> 00:12:21,320
 >> Yes, sir.

205
00:12:21,320 --> 00:12:24,360
 >> What is your max build out on the facility?

206
00:12:24,360 --> 00:12:28,360
 >> Right now I believe it's, what is it, 110?

207
00:12:28,360 --> 00:12:32,640
 We're sizing our head works right now for up to 75.

208
00:12:32,640 --> 00:12:34,040
 >> Okay. >> And that's another project that's

209
00:12:34,040 --> 00:12:34,760
 going on.

210
00:12:34,760 --> 00:12:36,160
 And this is in conjunction with this.

211
00:12:36,160 --> 00:12:39,600
 So our head works is up to 75.

212
00:12:39,600 --> 00:12:43,800
 So that would probably be in 40 year span, 75.

213
00:12:43,800 --> 00:12:46,920
 >> Okay, so the solids handling plan you were discussing, it's gonna be sized for

214
00:12:46,920 --> 00:12:47,760
 the 70? >> It's gonna be sized for

215
00:12:47,760 --> 00:12:48,840
 the ultimate build out, yes.

216
00:12:48,840 --> 00:12:49,440
 >> Okay, thank you.

217
00:12:49,440 --> 00:12:53,160
 >> Yes, sir. >> Question.

218
00:12:53,160 --> 00:12:56,360
 I was behind you a little bit, I was reading some of the backup before the end.

219
00:12:56,360 --> 00:13:00,600
 Did you say what you thought your estimated cost of construction was?

220
00:13:00,600 --> 00:13:05,280
 >> This estimated construction with contingencies is $134 million.

221
00:13:05,280 --> 00:13:06,320
 >> Okay.

222
00:13:06,320 --> 00:13:11,040
 >> And we're gonna use a CMAR method of delivery, meaning we can,

223
00:13:11,040 --> 00:13:17,000
 because of product flow and the time of getting some of this equipment.

224
00:13:17,000 --> 00:13:20,920
 We're gonna use CMAR method so we can evaluate some of the technology in order

225
00:13:20,920 --> 00:13:23,720
 to purchase those quicker, get an economy of scale,

226
00:13:23,720 --> 00:13:26,520
 there's some value to get those here and ready to go.

227
00:13:26,520 --> 00:13:28,280
 >> So yeah, I know what CMAR is, but that's, yeah.

228
00:13:28,280 --> 00:13:32,680
 So Kimberly Horn, you're expecting to run the project,

229
00:13:32,680 --> 00:13:34,880
 be basically almost the GC as well.

230
00:13:34,880 --> 00:13:39,440
 They're gonna be the design, the CMAR will go out on another separate contract.

231
00:13:39,440 --> 00:13:43,440
 Yeah, we'll evaluate those that can help us with the CMAR.

232
00:13:43,440 --> 00:13:43,940
 Yes, sir.

233
00:13:43,940 --> 00:13:46,920
 >> Other questions?

234
00:13:46,920 --> 00:13:51,480
 All right, do we have a motion to approve the Kimberly Horn and

235
00:13:51,480 --> 00:13:55,080
 associates contract to the amount of 14 million 952?

236
00:13:55,080 --> 00:13:58,420
 >> So moved.

237
00:13:58,420 --> 00:13:59,840
 >> Mr. Taylor moved.

238
00:13:59,840 --> 00:14:00,880
 Mr. Rebick seconds.

239
00:14:00,880 --> 00:14:02,400
 All in favor say aye.

240
00:14:02,400 --> 00:14:04,760
 >> Aye. >> Motion carries.

241
00:14:04,760 --> 00:14:10,240
 >> Thank you. >> Item P, Alamo Transformers Supply Company Contract.

242
00:14:10,240 --> 00:14:12,320
 An amount of $10 million.

243
00:14:12,320 --> 00:14:15,920
 [BLANK_AUDIO]

244
00:14:15,920 --> 00:14:17,000
 >> Good morning.

245
00:14:17,000 --> 00:14:19,360
 [BLANK_AUDIO]

246
00:14:19,360 --> 00:14:20,680
 Let's see.

247
00:14:20,680 --> 00:14:24,640
 I'm Rainey Key with the Municipal Electric, Electric Engineering Supervisor.

248
00:14:24,640 --> 00:14:29,320
 Bring in a contract for Alamo Transformers.

249
00:14:29,320 --> 00:14:39,320
 Okay, our lead times are currently 80 plus weeks.

250
00:14:39,320 --> 00:14:42,160
 The industry trend is moving towards two to three years.

251
00:14:42,160 --> 00:14:47,040
 Actually looking into the future is probably gonna be more like four,

252
00:14:47,040 --> 00:14:48,080
 possibly five years.

253
00:14:48,080 --> 00:14:54,280
 Current transformer inventory, we're below our minimum levels at the moment.

254
00:14:54,280 --> 00:14:57,880
 This contract will allow DME to get back to the minimum operating levels for

255
00:14:57,880 --> 00:15:02,440
 maintenance and outages and could also possibly help out with projects as well.

256
00:15:02,440 --> 00:15:06,080
 Shipment for transformers are sporadic.

257
00:15:06,080 --> 00:15:12,840
 We have a spend schedule, however, it's not usually correct.

258
00:15:12,840 --> 00:15:17,800
 [BLANK_AUDIO]

259
00:15:17,800 --> 00:15:21,520
 With this contract, we will rebuild, refurbish our current transformers and

260
00:15:21,520 --> 00:15:22,720
 return to service.

261
00:15:22,720 --> 00:15:28,400
 Right now, on average, we could send out maybe 200, 300 transformers

262
00:15:28,400 --> 00:15:29,320
 with this contract.

263
00:15:29,320 --> 00:15:33,480
 Rebuild and refurbish transformers provide significant cost savings and

264
00:15:33,480 --> 00:15:35,800
 quicker lead times compared to the new transformers,

265
00:15:35,800 --> 00:15:38,640
 which is pretty easy with a three to four year lead time.

266
00:15:38,640 --> 00:15:43,800
 The opportunity to purchase rebuild and refurbished from other utilities,

267
00:15:43,800 --> 00:15:47,240
 this is most likely what we will utilize this contract for for the majority.

268
00:15:49,760 --> 00:15:54,480
 By asking Alamo what they have on hand whenever we are at our minimums

269
00:15:54,480 --> 00:15:55,400
 like we are right now.

270
00:15:55,400 --> 00:15:59,360
 This will provide sustainable practices with pickup and

271
00:15:59,360 --> 00:16:03,720
 disposal of used oil and scrap transformers.

272
00:16:03,720 --> 00:16:06,040
 We'll be able to purchase the transformers with shorter lead times and

273
00:16:06,040 --> 00:16:10,640
 apply credit from scrap transformers that they pick up from our DME yard.

274
00:16:10,640 --> 00:16:14,760
 This will provide a temporary relief in the supply chain challenges that we are

275
00:16:14,760 --> 00:16:15,840
 facing right now.

276
00:16:15,840 --> 00:16:21,720
 This is the table of our estimated spend.

277
00:16:21,720 --> 00:16:26,400
 We're looking at about $3 million a year with a $1 million contingency.

278
00:16:26,400 --> 00:16:31,240
 This will help out with, I've brought through five

279
00:16:31,240 --> 00:16:36,040
 declaration of emergency transformer purchases so far.

280
00:16:36,040 --> 00:16:40,880
 And with that, it's been a little over $2 million.

281
00:16:40,880 --> 00:16:45,120
 So this would help tremendously with the slowing down of the declaration of

282
00:16:45,120 --> 00:16:47,120
 emergencies that Marcella loves so much.

283
00:16:47,120 --> 00:16:53,600
 And at that, I'll take some questions.

284
00:16:53,600 --> 00:16:56,080
 Yes, sir. >> Where did you come up with your cost estimates?

285
00:16:56,080 --> 00:16:58,840
 There's nothing in here that says anything about that.

286
00:16:58,840 --> 00:17:02,320
 I mean, is it like, are you, at this point with transformers,

287
00:17:02,320 --> 00:17:08,640
 is it like a comparison to, I've got Home Depot, Lowe's, and Ace, and

288
00:17:08,640 --> 00:17:10,480
 I don't know what the price is gonna be.

289
00:17:10,480 --> 00:17:15,080
 So, I mean, I looked at your evaluation sheet and, of course,

290
00:17:15,080 --> 00:17:17,200
 I think those are always very subjective.

291
00:17:17,200 --> 00:17:20,800
 >> The pricing is pretty much the same with all of them.

292
00:17:20,800 --> 00:17:24,240
 It's gonna vary by the size, the voltage, and everything else.

293
00:17:24,240 --> 00:17:27,600
 The only difference is we've done the declaration of emergency.

294
00:17:27,600 --> 00:17:31,840
 And a lot of the evaluation went with how quickly people respond and

295
00:17:31,840 --> 00:17:33,840
 how much information we can get from them at the time.

296
00:17:33,840 --> 00:17:35,400
 >> Well, if it's an emergency situation,

297
00:17:35,400 --> 00:17:37,880
 shouldn't you have more than one choice of where to get it?

298
00:17:37,880 --> 00:17:40,080
 >> We do, and that's what the declaration of emergencies are.

299
00:17:40,080 --> 00:17:43,880
 So we still have the option to use Solomon or anybody else, but

300
00:17:43,880 --> 00:17:45,680
 it would be a declaration of emergency.

301
00:17:45,680 --> 00:17:48,440
 This would just be, we would be in contract with them.

302
00:17:48,440 --> 00:17:52,000
 And also with this contract, we would be able to have them in contract to come pick

303
00:17:52,000 --> 00:17:56,760
 up our current transformers that we take off of projects and maintenance.

304
00:17:56,760 --> 00:17:58,760
 And so it wouldn't be an emergency for that, and

305
00:17:58,760 --> 00:18:00,880
 also to get rid of our oil and our scrap.

306
00:18:00,880 --> 00:18:04,520
 We currently don't have a contract for that.

307
00:18:04,520 --> 00:18:06,200
 >> Okay, where'd you come up with the pricing again?

308
00:18:07,600 --> 00:18:12,200
 That's just the $3 million for each year?

309
00:18:12,200 --> 00:18:14,440
 >> Well, you're talking about a $10 million contract total.

310
00:18:14,440 --> 00:18:15,640
 >> $3 million a year.

311
00:18:15,640 --> 00:18:20,240
 >> Yes, $3 million a year, that's just an average spend that we came up with by

312
00:18:20,240 --> 00:18:26,000
 asking around the average prices for each size transformer.

313
00:18:26,000 --> 00:18:29,000
 You're talking about from a half KVA all the way up to a 2,500 KVA at

314
00:18:29,000 --> 00:18:30,080
 different voltages.

315
00:18:30,080 --> 00:18:34,360
 >> And we've seen cost sheets before where you said here's the current prices.

316
00:18:34,360 --> 00:18:37,320
 I just didn't see it on this presentation, so.

317
00:18:37,320 --> 00:18:40,280
 >> It's gonna change every single time that you go out and you ask them.

318
00:18:40,280 --> 00:18:46,440
 >> So it's like just awarding it to Home Depot loads or basement, hardware or whatever.

319
00:18:46,440 --> 00:18:51,160
 >> Yeah, Billy, I think the reality is that we've seen a 200% increase in pricing

320
00:18:51,160 --> 00:18:52,960
 of these transformers.

321
00:18:52,960 --> 00:18:57,560
 And to be frank with you, there's no end in sight on that.

322
00:18:57,560 --> 00:19:00,720
 And we continue to see supply chain issues.

323
00:19:00,720 --> 00:19:05,120
 We continue to see raw material being diverted from transformers to

324
00:19:05,120 --> 00:19:07,720
 the electric vehicle industry.

325
00:19:07,720 --> 00:19:12,320
 And so it's really a crapshoot for us, to be honest with you.

326
00:19:12,320 --> 00:19:17,080
 And I think what Randy's done here is try to give a best cost estimate that we can,

327
00:19:17,080 --> 00:19:18,880
 not really knowing where we're gonna be.

328
00:19:18,880 --> 00:19:21,280
 If it's not enough money, we're gonna come back to you and

329
00:19:21,280 --> 00:19:22,840
 ask you for additional appropriation.

330
00:19:22,840 --> 00:19:28,240
 >> These dollar amounts can roll to additional years, correct, Lynn?

331
00:19:28,240 --> 00:19:29,120
 >> Yes.

332
00:19:29,120 --> 00:19:32,480
 >> Yeah, and I think what he's showing is that that $10 million will be over three

333
00:19:32,480 --> 00:19:37,760
 years, but if we find ourselves that we spent all of it in a year and a half,

334
00:19:37,760 --> 00:19:40,840
 then yeah, we're gonna have to come back for additional appropriation.

335
00:19:40,840 --> 00:19:41,920
 >> Yeah.

336
00:19:41,920 --> 00:19:43,360
 Mr. Rybeck, you had your hand up?

337
00:19:43,360 --> 00:19:45,040
 >> Yes, I had my hand up.

338
00:19:45,040 --> 00:19:48,520
 [LAUGH] I'm more concerned about the weeks than the dollars.

339
00:19:48,520 --> 00:19:52,360
 80 weeks, that's almost a year and a half.

340
00:19:52,360 --> 00:19:55,960
 Now, you're saying that's for an average utility transformer.

341
00:19:55,960 --> 00:19:57,160
 >> Yes, sir. >> A new one.

342
00:19:57,160 --> 00:20:02,320
 >> Yes, so our current contract, we still have POs

343
00:20:02,320 --> 00:20:05,600
 that are open that are at two years right now.

344
00:20:05,600 --> 00:20:06,280
 >> Wow.

345
00:20:06,280 --> 00:20:10,600
 >> Wow, so may I assume that as the transformer size and

346
00:20:10,600 --> 00:20:15,800
 complexity, i.e. higher voltage, goes up, that the time is extending?

347
00:20:15,800 --> 00:20:16,960
 >> No, sir.

348
00:20:16,960 --> 00:20:18,080
 >> Okay.

349
00:20:18,080 --> 00:20:19,680
 >> Not with the refurbished, is what you're saying.

350
00:20:19,680 --> 00:20:22,000
 >> Not with the refurbished or even with our current contract.

351
00:20:22,000 --> 00:20:25,920
 The voltage doesn't, they're all around two plus years.

352
00:20:25,920 --> 00:20:26,480
 >> Wow.

353
00:20:26,480 --> 00:20:30,120
 >> In fact, our three phase transformers are actually shorter lead times, so.

354
00:20:30,120 --> 00:20:34,560
 >> Yeah, and I just want to point out that again, these are supply chain issues

355
00:20:34,560 --> 00:20:38,600
 associated with the raw material that is associated with the transformers that are

356
00:20:38,600 --> 00:20:40,320
 being diverted.

357
00:20:40,320 --> 00:20:44,360
 But in addition to that, there's current efforts at the EPA to put in additional

358
00:20:44,360 --> 00:20:47,520
 standards that will further cause delays.

359
00:20:47,520 --> 00:20:48,760
 And so that's why it's so important for

360
00:20:48,760 --> 00:20:52,400
 us to get into the manufacturing process as soon as we can.

361
00:20:52,400 --> 00:20:56,440
 Get in line, that way when those things happen, we're already in line and

362
00:20:56,440 --> 00:20:58,920
 we're not having to kind of restart all over again.

363
00:20:58,920 --> 00:21:03,160
 But certainly, again, I don't want to give a doomsday scenario here.

364
00:21:03,160 --> 00:21:07,040
 But it's, we're trying to purchase as much as we can, as quickly as we can.

365
00:21:07,040 --> 00:21:11,840
 That way we can continue to operate, not just to serve our current customers.

366
00:21:11,840 --> 00:21:13,920
 Certainly that's our number one priority.

367
00:21:13,920 --> 00:21:19,040
 But also to have an inventory level in the event of an emergency.

368
00:21:19,040 --> 00:21:22,640
 And then thirdly is to serve new development.

369
00:21:22,640 --> 00:21:28,000
 >> Right, in addition to the transformers, maybe that's just the area you're working

370
00:21:28,000 --> 00:21:31,680
 on, but does this also apply to switch gear, main distribution panels?

371
00:21:31,680 --> 00:21:32,400
 >> Yes.

372
00:21:32,400 --> 00:21:35,040
 >> The same equipment that's getting the power to the transformers?

373
00:21:35,040 --> 00:21:39,480
 >> Yeah, Lee, we're having challenges right now with wood poles.

374
00:21:39,480 --> 00:21:42,480
 And we're looking at other options as well.

375
00:21:42,480 --> 00:21:45,000
 That's another discussion that we'll be coming back with you.

376
00:21:45,000 --> 00:21:47,240
 But yeah, we're having issues across the board.

377
00:21:47,240 --> 00:21:50,080
 And it's not just DME, it's industry wide.

378
00:21:50,080 --> 00:21:50,640
 >> Well, I understand that.

379
00:21:50,640 --> 00:21:54,080
 I mean, I realize we're not being singled out for this.

380
00:21:54,080 --> 00:21:58,960
 I was just curious, a transformer is a relatively straightforward piece of equipment to build.

381
00:21:58,960 --> 00:22:04,120
 But you start getting distribution panels, and switch gear, and the complexity is increasing.

382
00:22:04,120 --> 00:22:09,360
 I'm just wondering if those time frames are even worse than the 80 to 100 weeks that we're talking about.

383
00:22:09,360 --> 00:22:10,280
 >> They're not worse.

384
00:22:10,280 --> 00:22:12,000
 However, they have at least doubled.

385
00:22:12,000 --> 00:22:15,880
 So when you talk about switch gears, they've more than doubled in lead times.

386
00:22:15,880 --> 00:22:17,080
 >> So what are they now?

387
00:22:17,080 --> 00:22:19,880
 >> So for right now, they were about five months.

388
00:22:19,880 --> 00:22:21,880
 They're over a year at this point.

389
00:22:21,880 --> 00:22:24,200
 >> So they're now in the same boat as the transformers essentially?

390
00:22:24,200 --> 00:22:24,800
 >> Yes, sir.

391
00:22:24,800 --> 00:22:26,960
 >> Okay, so the whole industry- >> The whole industry.

392
00:22:26,960 --> 00:22:29,600
 >> Has the problem, regardless of what part of the-

393
00:22:29,600 --> 00:22:31,800
 >> Yes. >> Electrical supply chain we're talking about.

394
00:22:31,800 --> 00:22:32,400
 >> Yes. >> Thank you.

395
00:22:32,400 --> 00:22:35,000
 >> I have a question, go ahead, no, go ahead.

396
00:22:35,000 --> 00:22:36,720
 >> So these are rebuilt and refurbished?

397
00:22:36,720 --> 00:22:37,520
 >> Yes, sir.

398
00:22:37,520 --> 00:22:40,920
 >> Are there any concerns about reliability or lifespan?

399
00:22:40,920 --> 00:22:42,000
 >> Honestly, no.

400
00:22:42,000 --> 00:22:49,440
 In fact, right now, these have a better production rate than our new contract.

401
00:22:49,440 --> 00:22:51,240
 Our new contract, the transformers that are coming in,

402
00:22:51,240 --> 00:22:53,360
 we're seeing a higher failure rate.

403
00:22:53,360 --> 00:22:57,840
 And with these, the warranty that's in place, if they show bad,

404
00:22:57,840 --> 00:22:59,600
 then we'll get a replacement.

405
00:22:59,600 --> 00:23:03,480
 And so far, we're having a very good turnout from our refurbished.

406
00:23:03,480 --> 00:23:07,320
 >> What's the cost difference on average between a new one and a refurbished?

407
00:23:07,320 --> 00:23:10,400
 >> That varies because there are so many different sizes with single phase,

408
00:23:10,400 --> 00:23:13,080
 three phase, all the way from half KVA to 2,500.

409
00:23:13,080 --> 00:23:19,760
 However, they are a lot less expensive.

410
00:23:19,760 --> 00:23:24,080
 >> Can we divert more resources into a program such as this versus going after new,

411
00:23:24,080 --> 00:23:26,680
 if they're used as better?

412
00:23:26,680 --> 00:23:34,960
 >> You can, however, the amount that you would need would not be here for the refurbished.

413
00:23:34,960 --> 00:23:36,080
 >> Gotcha, thank you.

414
00:23:36,080 --> 00:23:39,560
 >> They need inventory of refurbishable transformers and so then we have the same issue.

415
00:23:39,560 --> 00:23:42,960
 >> Yeah, you're not going to have the amount that you would need on the refurb contract.

416
00:23:42,960 --> 00:23:45,960
 >> You stole my question, but thank you for asking it.

417
00:23:45,960 --> 00:23:46,440
 >> You're welcome.

418
00:23:46,440 --> 00:23:54,200
 >> I applaud your creativity in trying to solve this issue because boy, that's all we have to say.

419
00:23:54,200 --> 00:23:57,080
 >> I would also just expand a little bit on what Randy said.

420
00:23:57,080 --> 00:24:04,440
 So we are seeing a larger failure rate on transformers and just to give you a preview,

421
00:24:04,440 --> 00:24:08,640
 we are, through the budget process, going to be requesting for a piece

422
00:24:08,640 --> 00:24:12,440
 of equipment that's pretty standard in the industry to test these transformers

423
00:24:12,440 --> 00:24:13,360
 when they come in the yard.

424
00:24:13,360 --> 00:24:18,280
 The last thing we want is to have our folks putting up these transformers and then they fail,

425
00:24:18,280 --> 00:24:19,520
 you know, when they're working on them.

426
00:24:19,520 --> 00:24:24,200
 And so that is, you know, about a quarter of a million dollar piece of machinery

427
00:24:24,200 --> 00:24:28,840
 that we're going to be asking for to do exactly as these come in.

428
00:24:28,840 --> 00:24:31,640
 We're testing them in the yard before they ever go out.

429
00:24:31,640 --> 00:24:34,560
 But we're seeing about a 20% failure rate on new transformers.

430
00:24:34,560 --> 00:24:35,120
 >> On new?

431
00:24:35,120 --> 00:24:35,760
 >> So, yes.

432
00:24:35,760 --> 00:24:36,160
 >> Is it new?

433
00:24:36,160 --> 00:24:37,960
 >> On new, yeah.

434
00:24:37,960 --> 00:24:39,360
 >> Listen.

435
00:24:39,360 --> 00:24:39,960
 >> Yeah.

436
00:24:39,960 --> 00:24:43,280
 >> Yeah, I don't think it comes with AI yet, but if it does, we'll look into it.

437
00:24:43,280 --> 00:24:48,400
 So we won't be able to plug in our cars anytime soon, so.

438
00:24:48,400 --> 00:24:49,480
 >> I'm sorry.

439
00:24:49,480 --> 00:24:53,080
 So this is based on your current inventory too, right?

440
00:24:53,080 --> 00:24:53,320
 >> Yes.

441
00:24:53,320 --> 00:24:54,560
 >> What your needs are going to be.

442
00:24:54,560 --> 00:24:56,960
 How is your current inventory?

443
00:24:56,960 --> 00:24:58,280
 >> Depending on the size.

444
00:24:58,280 --> 00:25:02,560
 So we are at below minimums on certain sizes.

445
00:25:02,560 --> 00:25:05,480
 On certain sizes, we have an abundance of--

446
00:25:05,480 --> 00:25:06,720
 >> Like the larger ones probably?

447
00:25:06,720 --> 00:25:10,680
 >> The larger ones we have over what we need currently.

448
00:25:10,680 --> 00:25:15,240
 However, we do have projects where the growth is steadily happening.

449
00:25:15,240 --> 00:25:18,920
 And we will probably hit a low at some point at these sizes as well.

450
00:25:18,920 --> 00:25:22,400
 But on our most common single-phase transformers,

451
00:25:22,400 --> 00:25:24,760
 on a few sizes we are below our minimums.

452
00:25:24,760 --> 00:25:25,360
 >> Is that right?

453
00:25:25,360 --> 00:25:27,080
 Okay. Thank you.

454
00:25:27,080 --> 00:25:29,920
 >> And I know we've talked about this before,

455
00:25:29,920 --> 00:25:31,760
 but what's the impact to the new development?

456
00:25:31,760 --> 00:25:36,400
 Have we told people to slow their roll?

457
00:25:36,400 --> 00:25:40,360
 >> Yeah, we work with development services and we got some information

458
00:25:40,360 --> 00:25:41,840
 out to developers.

459
00:25:41,840 --> 00:25:46,920
 Randy and Jerry have gone to a couple places and talked with developers as well,

460
00:25:46,920 --> 00:25:48,480
 let them know what's happening.

461
00:25:48,480 --> 00:25:54,800
 What we've been trying to do is work with each developer, each development, right?

462
00:25:54,800 --> 00:25:57,120
 Make sure that we understand what their phasing is, right?

463
00:25:57,120 --> 00:25:59,240
 Make sure that we prioritize people.

464
00:25:59,240 --> 00:26:05,240
 We try to do a first come first basis type of assignment on these things.

465
00:26:05,240 --> 00:26:08,200
 And then we have folks like I think Brad Watts is here, you know?

466
00:26:08,200 --> 00:26:12,560
 Brad's one of our superintendents, and they get really creative out in the field

467
00:26:12,560 --> 00:26:16,200
 on how we energize people and what we can do.

468
00:26:16,200 --> 00:26:19,440
 And so we're certainly not doing anything outside what's norm or dangerous,

469
00:26:19,440 --> 00:26:23,600
 but certainly we're trying to accommodate everybody as much as we can.

470
00:26:23,600 --> 00:26:27,040
 Our number one priority though is our existing customers, right?

471
00:26:27,040 --> 00:26:31,640
 And in the event of emergency, so we're holding onto stock and we know we are,

472
00:26:31,640 --> 00:26:34,560
 and it's a difficult conversation we're having with developers, but we're not going

473
00:26:34,560 --> 00:26:38,520
 to jeopardize our current customers for new development that's not even there yet.

474
00:26:38,520 --> 00:26:40,200
 >> There's some jumper cables out there.

475
00:26:40,200 --> 00:26:45,600
 >> You can talk to Brad later and tell him what they're doing.

476
00:26:45,600 --> 00:26:46,880
 >> All right, and -- oh, go ahead.

477
00:26:46,880 --> 00:26:51,280
 >> Is there a possibility of forming a partnership with other utilities?

478
00:26:51,280 --> 00:26:55,640
 >> Yes, there is, and I've been in talks with a few other electric utilities about that.

479
00:26:55,640 --> 00:26:57,000
 >> Okay, thank you.

480
00:26:57,000 --> 00:27:01,800
 >> And this contract included refurbishing from other utilities transformers, correct?

481
00:27:01,800 --> 00:27:02,400
 >> Yes.

482
00:27:02,400 --> 00:27:03,720
 >> Did I steal your -- oh.

483
00:27:03,720 --> 00:27:10,440
 >> I would just point out real quick, you know, Mr. Plotk, remember, for new development,

484
00:27:10,440 --> 00:27:15,960
 if it's happening in dual or triple certified area, we're in competition, right?

485
00:27:15,960 --> 00:27:20,880
 And so there's not a lot of cooperation in those areas, just be sure of that, right?

486
00:27:20,880 --> 00:27:25,200
 And so within our existing area, I think that's a different situation, but when we're

487
00:27:25,200 --> 00:27:31,000
 out there competing, you know, you're going to use everything you can at your disposal.

488
00:27:31,000 --> 00:27:37,120
 >> Are the transformers that are out on the poles in the residential areas,

489
00:27:37,120 --> 00:27:41,000
 are those the ones that you're most in shortage of?

490
00:27:41,000 --> 00:27:47,240
 >> The ones that are on the poles, right now, we are low on certain size of the overhead,

491
00:27:47,240 --> 00:27:53,240
 which is what you're speaking of, but the biggest issue that we face are the pad mounted,

492
00:27:53,240 --> 00:27:54,960
 so the ones that are underground.

493
00:27:54,960 --> 00:28:04,280
 >> I wouldn't have thought that, but oh, eye opening.

494
00:28:04,280 --> 00:28:06,800
 All right, other questions?

495
00:28:06,800 --> 00:28:09,920
 Do we have a motion to approve item E?

496
00:28:09,920 --> 00:28:11,000
 >> So moved.

497
00:28:11,000 --> 00:28:12,480
 >> Second.

498
00:28:12,480 --> 00:28:13,800
 >> Thank you very much.

499
00:28:13,800 --> 00:28:15,280
 >> All in favor, say aye.

500
00:28:15,280 --> 00:28:15,680
 >> Aye.

501
00:28:15,680 --> 00:28:16,800
 >> Aye.

502
00:28:16,800 --> 00:28:17,960
 >> Carries.

503
00:28:17,960 --> 00:28:26,040
 Okay, item F, approve a contract with Peer Technologies U.S. Inc. for the amount of $10 million.

504
00:28:26,040 --> 00:28:33,960
 >> Good morning.

505
00:28:33,960 --> 00:28:34,720
 >> Good morning.

506
00:28:34,720 --> 00:28:35,800
 >> My name is Tyler Dawson.

507
00:28:35,800 --> 00:28:37,200
 I'm with Water Utilities.

508
00:28:37,200 --> 00:28:39,720
 It's been a couple of years since I've presented to this board.

509
00:28:39,720 --> 00:28:41,840
 It's good to be back in front of you.

510
00:28:41,840 --> 00:28:46,720
 I'm here to present a contract for approval for the condition assessment

511
00:28:46,720 --> 00:28:49,120
 of our water transmission mains.

512
00:28:49,120 --> 00:28:52,880
 Starting off with some understanding of what assets we're looking at,

513
00:28:52,880 --> 00:28:59,600
 transmission mains are typically, we consider them 14 inches in diameter or larger.

514
00:28:59,600 --> 00:29:04,080
 Really, we define them by their function, which is these transmission mains send water

515
00:29:04,080 --> 00:29:10,000
 to different parts of the city before they branch off to serve individual homes and businesses.

516
00:29:10,000 --> 00:29:14,560
 They carry much higher flows than your typical residential water mains running

517
00:29:14,560 --> 00:29:19,280
 down the street in front of your house, and they are critical assets.

518
00:29:19,280 --> 00:29:25,160
 They ensure that all of our customers on all regions of our city have enough water,

519
00:29:25,160 --> 00:29:28,720
 not only for their use, but for fire protection as well.

520
00:29:28,720 --> 00:29:33,440
 They also, interestingly, have some of the longest design life of our water assets.

521
00:29:33,440 --> 00:29:40,200
 Your small diameter water mains are typically designed for about a 50-year life cycle.

522
00:29:40,200 --> 00:29:44,600
 Some of your mechanical assets, like your plant assets that we constantly maintain may have as low

523
00:29:44,600 --> 00:29:46,920
 as a 10- to 25-year life cycle.

524
00:29:46,920 --> 00:29:50,960
 Transmission mains are typically designed for a 70-year life cycle.

525
00:29:50,960 --> 00:29:57,120
 So if you look at any of these mains that's reaching the end of its design life now in 2023,

526
00:29:57,120 --> 00:30:01,040
 we're talking about mains that were installed in the early 1950s.

527
00:30:01,040 --> 00:30:02,800
 So there's a lot of unknowns.

528
00:30:02,800 --> 00:30:04,000
 They are buried assets.

529
00:30:04,000 --> 00:30:08,600
 We don't get to put eyes on them in any simple method.

530
00:30:08,600 --> 00:30:13,360
 So we're looking at doing assessments on some of our most critical transmission mains

531
00:30:13,360 --> 00:30:16,320
 to determine where they might have failure points

532
00:30:16,320 --> 00:30:19,880
 and how much life they have left in them.

533
00:30:19,880 --> 00:30:25,320
 The methodology on this is equipment that's going to be sent through the pipe.

534
00:30:25,320 --> 00:30:31,200
 Typically under pressure, there's a variety of equipment that can serve different functions

535
00:30:31,200 --> 00:30:34,600
 and tell us different things about each pipe.

536
00:30:34,600 --> 00:30:41,160
 Some of that includes acoustic technology that can listen for irregular flow in the pipe.

537
00:30:41,160 --> 00:30:44,040
 So if there is a leak, there's a certain acoustic signature

538
00:30:44,040 --> 00:30:46,840
 that can lead us to believe there is a leak.

539
00:30:46,840 --> 00:30:50,240
 Same with if there are air gaps in the pipe.

540
00:30:50,240 --> 00:30:53,400
 If we're not sufficiently releasing air from those pipes,

541
00:30:53,400 --> 00:30:56,000
 there's a certain acoustic signature that goes with those

542
00:30:56,000 --> 00:30:58,920
 and some equipment can tell us where those spots are.

543
00:30:58,920 --> 00:31:02,480
 There's also equipment that can look at the steel cylinder within the pipe wall.

544
00:31:02,480 --> 00:31:08,520
 So your typical transmission main is about a three-layer structure.

545
00:31:08,520 --> 00:31:12,240
 The center of that is a steel cylinder.

546
00:31:12,240 --> 00:31:17,440
 And then there's a mortar coating or concrete on the inside to protect that steel from the water

547
00:31:17,440 --> 00:31:20,320
 so we don't have rust and corrosion on the steel cylinder.

548
00:31:20,320 --> 00:31:23,800
 And then there's more concrete and sometimes some reinforcing bars or wires

549
00:31:23,800 --> 00:31:29,800
 on the outside of the steel cylinder to provide more reinforcement to hold that water pressure in.

550
00:31:29,800 --> 00:31:33,320
 The most critical part of that is the steel cylinder.

551
00:31:33,320 --> 00:31:38,840
 And there's some electromagnetic technology that can send an electromagnetic signal

552
00:31:38,840 --> 00:31:41,920
 through the pipe wall and tell us where it's thinning.

553
00:31:41,920 --> 00:31:48,160
 So if water has bypassed that mortar coating on the inside and started to corrode the steel,

554
00:31:48,160 --> 00:31:52,880
 we can find that before it ruptures and causes a main breaker leak.

555
00:31:52,880 --> 00:31:58,280
 There are also camera technologies that can just get a visual look at the pipe,

556
00:31:58,280 --> 00:32:03,400
 see if you have cracks, see if there are any signs of degradation within the pipe.

557
00:32:03,400 --> 00:32:06,960
 Those inspections typically don't involve any excavation.

558
00:32:06,960 --> 00:32:10,520
 They are considered trenchless technologies.

559
00:32:10,520 --> 00:32:13,800
 The only exception to that will be for access points.

560
00:32:13,800 --> 00:32:20,360
 So we have to be able to deploy the technology into the pipe and then retrieve it at another point.

561
00:32:20,360 --> 00:32:22,520
 So sometimes we can do that through hydrants.

562
00:32:22,520 --> 00:32:26,600
 Sometimes we can do that through other existing approaches to the pipe.

563
00:32:26,600 --> 00:32:32,760
 In other cases, we will have to install an access point, which luckily we can do at our own timing

564
00:32:32,760 --> 00:32:36,200
 and not under emergency scenarios such as a main break.

565
00:32:36,200 --> 00:32:41,040
 And then the most important part of this is we will get reports

566
00:32:41,040 --> 00:32:44,240
 with the vendor's review of all the results.

567
00:32:44,240 --> 00:32:45,720
 That will tell us a couple of things.

568
00:32:45,720 --> 00:32:51,080
 One, where we have known or potential leaks that we need to send out and repair.

569
00:32:51,080 --> 00:32:57,200
 And then it will tell us overall pipe condition, which will help inform capital decisions.

570
00:32:57,200 --> 00:33:04,600
 Make sure we're spending money where we really need to, not just because a pipe has reached a certain age.

571
00:33:04,600 --> 00:33:08,920
 So the biggest improvement that we'll see from this,

572
00:33:08,920 --> 00:33:12,160
 the most visible improvement is preventing main breaks.

573
00:33:12,160 --> 00:33:18,280
 Again, especially with being able to see thinning of the steel cylinder in the pipe wall,

574
00:33:18,280 --> 00:33:23,000
 that will tell us in advance of a main break that there is a potential break coming.

575
00:33:23,000 --> 00:33:27,240
 So any main break, we know, we don't like it.

576
00:33:27,240 --> 00:33:28,440
 We don't want main breaks.

577
00:33:28,440 --> 00:33:30,400
 We want to prevent them wherever possible.

578
00:33:30,400 --> 00:33:33,560
 Any main break can have the potential for water outages.

579
00:33:33,560 --> 00:33:36,120
 If we have to shut down pressure to make the repair,

580
00:33:36,120 --> 00:33:40,560
 any time water inside the pipe comes in contact with anything outside the pipe,

581
00:33:40,560 --> 00:33:42,600
 we have potential for contamination.

582
00:33:42,600 --> 00:33:46,280
 And then if you're losing water, that could result in loss of fire protection

583
00:33:46,280 --> 00:33:52,720
 or even a boil water notice if we can't maintain the TCEQ required pressures within that pipe.

584
00:33:52,720 --> 00:33:56,000
 Of course, some of the smaller but more visible effects.

585
00:33:56,000 --> 00:34:01,040
 Any time there's a main break in or near a road, we're going to have traffic interruptions,

586
00:34:01,040 --> 00:34:05,240
 both for the repair of the main break and sometimes for the water itself.

587
00:34:05,240 --> 00:34:08,360
 And then temporary damage to whatever rests over that main.

588
00:34:08,360 --> 00:34:11,560
 So the streets, the yards, we're going to have to dig through that.

589
00:34:11,560 --> 00:34:15,320
 There may be even damage from the break itself that we have to go back and backfill

590
00:34:15,320 --> 00:34:17,720
 and restore to its original condition.

591
00:34:17,720 --> 00:34:20,000
 So that's for any main break.

592
00:34:20,000 --> 00:34:23,360
 We're talking about our larger mains here with higher flows.

593
00:34:23,360 --> 00:34:26,160
 They're going to have a higher impact.

594
00:34:26,160 --> 00:34:33,200
 We had one unexpected main break on a 16 inch about four months ago that it was more difficult to repair.

595
00:34:33,200 --> 00:34:35,520
 It caused a bigger issue.

596
00:34:35,520 --> 00:34:37,880
 We want to prevent those wherever possible.

597
00:34:37,880 --> 00:34:43,120
 We can we can justify tolerating a few of our smaller main breaks.

598
00:34:43,120 --> 00:34:45,360
 You know, the impact tends to be very localized.

599
00:34:45,360 --> 00:34:46,720
 They tend to be easy to repair.

600
00:34:46,720 --> 00:34:48,680
 We have those repair parts in stock.

601
00:34:48,680 --> 00:34:52,600
 It's pretty easy to get to those and fix them with minimal impact.

602
00:34:52,600 --> 00:34:59,280
 But on the larger mains, we want to prevent those wherever possible.

603
00:34:59,280 --> 00:35:05,160
 And then to look at the cost side of things, we just talked about the impact to a single main break,

604
00:35:05,160 --> 00:35:06,880
 the impact that comes from a single main break.

605
00:35:06,880 --> 00:35:18,200
 But when we're talking about capital, these mains, they go on the average in the range of about $500 to $15 per linear foot to install.

606
00:35:18,200 --> 00:35:26,960
 So if we were to replace one of these mains today, that's what we would be paying to restore that asset and renew it to that 70 year design life.

607
00:35:26,960 --> 00:35:32,640
 You annualize that down to about seven to twenty one dollars per year over the life of that investment.

608
00:35:32,640 --> 00:35:41,280
 The inspection costs, depending on which technology we deploy and we'll work with a consultant to decide which technology is best for each pipe.

609
00:35:41,280 --> 00:35:45,160
 That ranges from about five to twenty five dollars per linear foot.

610
00:35:45,160 --> 00:35:48,680
 We assume I assumed an annualized life of that inspection of about 10 years.

611
00:35:48,680 --> 00:35:50,840
 We could go back in 10 years and repeat this process.

612
00:35:50,840 --> 00:35:53,920
 We could wait a little bit longer and reduce that annualized cost.

613
00:35:53,920 --> 00:35:59,120
 But that comes down to 50 cents to two dollars and 50 cents per year per linear foot.

614
00:35:59,120 --> 00:36:08,840
 So by simple comparison of capital cost versus assessment cost, at worst, we're talking about a 35 percent of capital expenditure.

615
00:36:08,840 --> 00:36:10,920
 At best, we're going to be much lower than that.

616
00:36:10,920 --> 00:36:21,240
 And ideally, we're going to be able to drive capital decisions by saying, yes, we have a 70 year old pipe here, but it may have 10 or 20 years left in its life.

617
00:36:21,240 --> 00:36:22,840
 Again, these are buried assets.

618
00:36:22,840 --> 00:36:25,040
 We don't readily get eyes on these pipes.

619
00:36:25,040 --> 00:36:26,720
 We don't know the actual condition.

620
00:36:26,720 --> 00:36:33,200
 But the best we can do sometimes is make assumptions by how old they are, what they're made of, what their break history is.

621
00:36:33,200 --> 00:36:44,160
 So this will give us so much more information and help us make smarter capital decisions and defer a lot of those installation costs for the right time.

622
00:36:44,160 --> 00:36:46,680
 At this point, I'll take any questions.

623
00:36:46,680 --> 00:36:58,040
 So as you're replacing mains, what percentage or how much of your mains that you're replacing would you have not replaced if you were able to inspect them prior to replacing them?

624
00:36:58,040 --> 00:36:59,400
 That's a really hard question.

625
00:36:59,400 --> 00:37:02,240
 And we don't have firm numbers on that.

626
00:37:02,240 --> 00:37:12,840
 We do find that to be an issue sometimes, particularly it's easier to see in our small diameter mains that those are more common to replace.

627
00:37:12,840 --> 00:37:14,680
 They're done at higher numbers.

628
00:37:14,680 --> 00:37:24,920
 But we may be replacing half a mile of water main and find that there may be one or two localized locations where based on soil conditions or installation factors

629
00:37:24,920 --> 00:37:34,160
 or some aspect of that pipe and the effects of the environment around it, those are the really bad parts.

630
00:37:34,160 --> 00:37:40,000
 But we end up replacing the whole pipe without necessarily knowing where those bad pockets are.

631
00:37:40,000 --> 00:37:42,120
 So a technology like this would minimize?

632
00:37:42,120 --> 00:37:44,800
 Yes.

633
00:37:44,800 --> 00:37:56,160
 Speaking of the technology, while this whatever testing methodologies you choose or between you and the consultant choose and that work is going on,

634
00:37:56,160 --> 00:38:02,160
 will water department personnel be witnessing any of this or watching this as it's underway?

635
00:38:02,160 --> 00:38:02,800
 Absolutely.

636
00:38:02,800 --> 00:38:05,080
 It will be heavily monitored.

637
00:38:05,080 --> 00:38:07,400
 There's a lot of preparation work that goes into it, too.

638
00:38:07,400 --> 00:38:08,640
 Oh, absolutely.

639
00:38:08,640 --> 00:38:12,760
 I made reference to the access points to make sure we have proper access points.

640
00:38:12,760 --> 00:38:17,800
 We're also looking at what exists on that entire stretch of pipe.

641
00:38:17,800 --> 00:38:21,360
 We may be doing, say, half a mile or a full mile and one deployment.

642
00:38:21,360 --> 00:38:29,320
 And we need to know where are there valves that we may need to open or close or valves that may hinder the equipment from coming through it.

643
00:38:29,320 --> 00:38:35,080
 So we'll be doing heavy research into the original designs of these pipelines.

644
00:38:35,080 --> 00:38:40,120
 And we'll make sure we know, put some eyes on wherever we can to make sure we know what's there.

645
00:38:40,120 --> 00:38:51,920
 And then when it comes time to do the actual inspection, we'll have both contractor personnel and water utilities personnel on site to execute that inspection as best we can.

646
00:38:51,920 --> 00:38:52,760
 Well, that's great.

647
00:38:52,760 --> 00:38:57,840
 What kind of turnaround do you typically get on the reporting?

648
00:38:57,840 --> 00:39:03,920
 We did inspections on our raw water pipelines coming from Lake Louisville.

649
00:39:03,920 --> 00:39:06,360
 And I'm not sure about the turnaround.

650
00:39:06,360 --> 00:39:09,640
 Stephen, do you know what timeline we're on on those projects?

651
00:39:09,640 --> 00:39:11,960
 This is with the same consultant and similar technologies.

652
00:39:11,960 --> 00:39:18,640
 Stephen Gay, Director of Water Utilities.

653
00:39:18,640 --> 00:39:24,000
 Mr. Rybeck, that inspection, we're still pending the results from the raw water line.

654
00:39:24,000 --> 00:39:28,080
 And it's usually about a three to six month turnaround time, depending on the amount of data.

655
00:39:28,080 --> 00:39:33,120
 Because they have to go through all the data, analyze it, and then come up with the recommendations.

656
00:39:33,120 --> 00:39:35,520
 Okay, very good. Thank you.

657
00:39:35,520 --> 00:39:37,360
 Go ahead, David.

658
00:39:37,360 --> 00:39:39,360
 Thank you.

659
00:39:39,360 --> 00:39:40,720
 So I have several questions.

660
00:39:40,720 --> 00:39:48,400
 Is this the first program we've had to do the internal inspection of water mains?

661
00:39:48,400 --> 00:39:51,640
 So again, we've done a similar inspection on our raw water mains.

662
00:39:51,640 --> 00:40:03,080
 There's about a nine mile set of parallel pipelines that goes from our Lake Louisville raw water station up to the plant on Spencer Road using similar technologies with the same consultant.

663
00:40:03,080 --> 00:40:10,360
 To my knowledge, in my time with the city, this is the first time we've executed this on finished water transmission mains.

664
00:40:10,360 --> 00:40:14,960
 I thought we had the camera before.

665
00:40:14,960 --> 00:40:24,640
 One point of clarification is in 2021, Freeze and Nichols launched a study that looked at our transmission main, and they did a condition assessment on them,

666
00:40:24,640 --> 00:40:30,160
 identified the most critical mains and the ones that had the highest consequence of failure and probability of failure.

667
00:40:30,160 --> 00:40:31,800
 And those will be included in this study.

668
00:40:31,800 --> 00:40:38,680
 Now, what you may be thinking about, Susan, is the assessment that we did on the raw water line.

669
00:40:38,680 --> 00:40:43,680
 So we did look at the raw water lines with the pure technology equipment.

670
00:40:43,680 --> 00:40:49,080
 So we're using the same methodology on our active transmission of finished water.

671
00:40:49,080 --> 00:40:50,880
 So that's the distinction.

672
00:40:50,880 --> 00:40:56,320
 So the previous study was like a desktop analysis of risk, basically?

673
00:40:56,320 --> 00:41:03,760
 Basically, looking at, OK, method of installation, does it cross a railroad track, depth, soil conditions?

674
00:41:03,760 --> 00:41:05,520
 Is it a dead end?

675
00:41:05,520 --> 00:41:10,120
 Is it serving a major, densely populated area?

676
00:41:10,120 --> 00:41:15,800
 Those types of factors were taken into consideration, as well as age and pipe material as well.

677
00:41:15,800 --> 00:41:23,000
 And I don't want to get too in the weeds, but I'm curious if we know, since the 1950s,

678
00:41:23,000 --> 00:41:27,040
 are we looking at how many different technologies of manufacturing technologies?

679
00:41:27,040 --> 00:41:34,120
 Do we have like cast iron and PVC as well as the pre-stressed concrete, or is it pretty much all pre-stressed concrete?

680
00:41:34,120 --> 00:41:38,600
 Yeah, I think it's pretty much all pre-stressed concrete because of the pressures,

681
00:41:38,600 --> 00:41:46,560
 because the construction methodology of the actual pipe is based off pressure and the pressure rating and the flows.

682
00:41:46,560 --> 00:41:50,040
 And that's the most favorable design.

683
00:41:50,040 --> 00:41:52,200
 You can correct me if I'm wrong.

684
00:41:52,200 --> 00:42:01,000
 Sure. I think the only different technologies we would see is there's bar wrapped and there is a pre-stressed wire.

685
00:42:01,000 --> 00:42:09,040
 So we'll see some difference whether there's a wire wrapping around the steel cylinder encased in concrete or basically rebar steel bars around the concrete.

686
00:42:09,040 --> 00:42:17,240
 I know Pure is a technological leader in the pre-stressed concrete analysis.

687
00:42:17,240 --> 00:42:24,200
 I'm also curious, this is a five-year contract and you're showing you on an inspection about every 10 years on average.

688
00:42:24,200 --> 00:42:37,480
 Is the plan to turn this into an ongoing program to do half of it every five years covering the whole system or initial assessment in only high risk areas?

689
00:42:37,480 --> 00:42:42,800
 Since this is the first time that we're really doing it on the finished water side of the equation,

690
00:42:42,800 --> 00:42:48,520
 we're going to look at the data and that's going to drive the frequency of this analysis.

691
00:42:48,520 --> 00:42:49,760
 So it will become a program.

692
00:42:49,760 --> 00:42:59,680
 So once we get the analysis done and we identify what we need to fix, we'll also come up with a frequency of re-evaluating this infrastructure.

693
00:42:59,680 --> 00:43:04,120
 And this amount in this contract, I guess is it 10 million?

694
00:43:04,120 --> 00:43:05,440
 10 million over three years, yes.

695
00:43:05,440 --> 00:43:12,400
 And this will cover an initial assessment everywhere or is this only the higher risk?

696
00:43:12,400 --> 00:43:15,080
 It is the higher risk.

697
00:43:15,080 --> 00:43:16,200
 It's pretty broad.

698
00:43:16,200 --> 00:43:21,360
 In fact, I can show you quickly, I have some backup slides here.

699
00:43:21,360 --> 00:43:28,680
 If you can see the colored lines on here, that is our working map of project areas we want to touch.

700
00:43:28,680 --> 00:43:36,440
 If you remember the map of all of our transmission mains, this covers probably 60 to 70 percent of them.

701
00:43:36,440 --> 00:43:47,640
 A lot of those were installed in the 50s and 60s, and so those are getting near end of design life where it would be critical to do that assessment before we replace.

702
00:43:47,640 --> 00:43:57,160
 We also have in particular up here the 54 inch main that takes water from the Ray Roberts treatment plant down to the city.

703
00:43:57,160 --> 00:44:01,280
 That is the only pipeline that brings water from Ray Roberts down to the city at this point.

704
00:44:01,280 --> 00:44:08,560
 So even though it is only about 20 years old, we want to do an assessment there because it's highly, highly critical.

705
00:44:08,560 --> 00:44:21,560
 Yes, so I think while we're approving this contract, what I like seeing here is this long term program to risk based assessment of these pipeline assets

706
00:44:21,560 --> 00:44:32,240
 because some of this stuff will last 100 or 150 years in the ground if it's, you know, well cared for and doesn't get a lot of pressure variation.

707
00:44:32,240 --> 00:44:36,760
 And other could be extremely critical if it fails or has a premature failure.

708
00:44:36,760 --> 00:44:44,640
 So being able to do this initial assessment and then set up a risk based analysis going forward, I think, it sounds great.

709
00:44:44,640 --> 00:44:53,720
 Well said. A lot of the variation and the condition of the pipes over time is based on the installation practices of the pipe.

710
00:44:53,720 --> 00:45:02,160
 And we found that in our raw main where we had one installed in the 50s, one installed in the 70s, the newer pipe was installed without proper bedding.

711
00:45:02,160 --> 00:45:06,040
 And it has actually started to fail sooner than the pipe that's 20 years older than it.

712
00:45:06,040 --> 00:45:15,920
 So that's a very critical factor and the ability of these pipes to last and continue to service the customers.

713
00:45:15,920 --> 00:45:22,120
 And it's really hard to know what those installation practices were in the 1950s and 1960s.

714
00:45:22,120 --> 00:45:28,400
 So this will help identify that.

715
00:45:28,400 --> 00:45:36,800
 Other questions? All right. You had one just it's disappointing to just get one response.

716
00:45:36,800 --> 00:45:41,880
 I know that one hundred three hundred sixty. Obviously, there's probably people that weren't interested in that at all.

717
00:45:41,880 --> 00:45:52,720
 But thirteen was the number of suppliers that viewed the solicitation itself and only one response.

718
00:45:52,720 --> 00:45:59,480
 That's that's true. We did have two that said they intended to respond and did not follow up.

719
00:45:59,480 --> 00:46:02,800
 I don't know the reasoning behind that.

720
00:46:02,800 --> 00:46:09,040
 We were happy to get Pure's response, though, and two reasons we were happy with their proposal.

721
00:46:09,040 --> 00:46:12,680
 One, their pricing was right in line with our estimates.

722
00:46:12,680 --> 00:46:20,720
 So we were happy to go along with their pricing to they are, as you mentioned, a leader in this technology and an industry leader for sure.

723
00:46:20,720 --> 00:46:26,840
 And we actually reached out to them to help build our specs since they were an industry leader.

724
00:46:26,840 --> 00:46:32,680
 So they were a perfect fit for this contract.

725
00:46:32,680 --> 00:46:34,560
 Other questions? All right.

726
00:46:34,560 --> 00:46:38,280
 Do we have a motion to approve Pure Technologies, U.S.

727
00:46:38,280 --> 00:46:40,520
 Inc. contract for ten million dollars?

728
00:46:40,520 --> 00:46:43,960
 So Devin moves. Do we have a second?

729
00:46:43,960 --> 00:46:46,720
 Thank you, Barbara. Second. All in favor say aye.

730
00:46:46,720 --> 00:46:54,160
 Motion carries. Thank you. Management reports.

731
00:46:54,160 --> 00:46:58,240
 Madam Chair, members of the PAB, just going through the future agenda items.

732
00:46:58,240 --> 00:47:02,680
 Again, no changes to to the items that are on there.

733
00:47:02,680 --> 00:47:06,440
 A lot of budget stuff coming on. I think I've said that every time that we've met.

734
00:47:06,440 --> 00:47:10,800
 There is a presentation today on some of the forecasts.

735
00:47:10,800 --> 00:47:15,120
 So I think Danielle, the finance team will have that with you today.

736
00:47:15,120 --> 00:47:18,880
 And then going to new business, a new business item.

737
00:47:18,880 --> 00:47:22,840
 We've already completed the the dead low trends that was provided at the last meeting.

738
00:47:22,840 --> 00:47:27,080
 And we did have a question last week, a request at the last meeting for an update.

739
00:47:27,080 --> 00:47:29,320
 I wonder if you're working on a memo to you on that.

740
00:47:29,320 --> 00:47:32,160
 I hope to have it to you for your next meeting.

741
00:47:32,160 --> 00:47:34,400
 So with that, that's all we have for the management report.

742
00:47:34,400 --> 00:47:40,120
 Happy to answer any questions or if there's anything else you need.

743
00:47:40,120 --> 00:47:43,480
 I see none. Brings us to concluding items.

744
00:47:43,480 --> 00:47:50,800
 Does any board member wish to say anything to the public or add something to a future agenda?

745
00:47:50,800 --> 00:47:53,560
 OK, and we'll go into work session.

746
00:47:53,560 --> 00:47:56,960
 The first one is receive a report and hold a discussion and give staff direction

747
00:47:56,960 --> 00:48:05,320
 regarding fiscal year 2023, 2024 utility budgets forecast.

748
00:48:05,320 --> 00:48:11,000
 Good morning, P.U.B. Danielle Stanford, budget manager.

749
00:48:11,000 --> 00:48:15,600
 And this morning I have a brief presentation on the utility forecast presentation.

750
00:48:15,600 --> 00:48:21,440
 So this is what guides the budgets that you will see in the next few months.

751
00:48:21,440 --> 00:48:31,640
 So today we'll go over a quick overview of the budget process, a growth forecast for each utility and then the next steps.

752
00:48:31,640 --> 00:48:37,440
 So our budget cycle started in January of this year, so we did our budget kickoff in January.

753
00:48:37,440 --> 00:48:45,760
 In March through May, the budget team worked with the departments for continued budget development and planning.

754
00:48:45,760 --> 00:48:51,400
 In June and July, you will see presentations to both P.U.B. and to city council.

755
00:48:51,400 --> 00:49:00,360
 In August, we'll do our budget workshop with city council and any follow up workshops in August and September.

756
00:49:00,360 --> 00:49:10,040
 And then our public hearings in September and finally budget adoption and rate adoption in late September.

757
00:49:10,040 --> 00:49:18,240
 So our financial assumptions include Hunter Cole being accounted for in year 2024 for all utilities.

758
00:49:18,240 --> 00:49:23,840
 Solid waste forecast is based on customer counts, tonnage and service frequency.

759
00:49:23,840 --> 00:49:28,800
 The water wastewater forecast is based. It's a volume based forecast.

760
00:49:28,800 --> 00:49:34,800
 We do continue to seek alternative funding sources for the water wastewater fund.

761
00:49:34,800 --> 00:49:41,440
 And then finally, the Lake Ray Roberts plant expansion is accounted for beginning in 2024.

762
00:49:41,440 --> 00:49:47,800
 And then finally, the electric forecast is based on megawatt hours.

763
00:49:47,800 --> 00:49:50,160
 So the solid waste forecast is seen here.

764
00:49:50,160 --> 00:49:52,600
 It's broken out into four different components.

765
00:49:52,600 --> 00:50:01,360
 The residential customer count that's growing on an average two and a half percent increase from from this year forward.

766
00:50:01,360 --> 00:50:07,800
 The front load, side load hauls, the roll off hauls and the landfill transaction count.

767
00:50:07,800 --> 00:50:12,120
 The front load side load is growing at an average of one percent.

768
00:50:12,120 --> 00:50:20,760
 And then the roll off and landfill transactions are growing at one point seven five percent.

769
00:50:20,760 --> 00:50:24,240
 So this is the water volume forecast.

770
00:50:24,240 --> 00:50:34,320
 So if you remember last year when we shared this, the Lake Ray Roberts plant expansion was not planned until 2032.

771
00:50:34,320 --> 00:50:41,880
 This forecast does include that being moved up to 2025.

772
00:50:41,880 --> 00:50:45,320
 And that's just based on the master planning effort.

773
00:50:45,320 --> 00:50:57,360
 We've evaluated both the water and wastewater demands in the current development climate and identified the need to accelerate that expansion.

774
00:50:57,360 --> 00:51:01,880
 This slide shows the water production and the trend of that year to date.

775
00:51:01,880 --> 00:51:05,400
 As you can see, the red line is where we are year to date.

776
00:51:05,400 --> 00:51:16,440
 Yellow is last year and the blue line is the budget. So we are above above both last year's demand and the budget for this year.

777
00:51:16,440 --> 00:51:19,920
 Could I can we go back just really quickly?

778
00:51:19,920 --> 00:51:23,160
 If I'm reading this right. Sorry, I went the wrong way.

779
00:51:23,160 --> 00:51:24,920
 No problem. There you go.

780
00:51:24,920 --> 00:51:31,440
 So the gray is the five year, the gray is the five year average, and that's two and a half years on top of that.

781
00:51:31,440 --> 00:51:34,920
 So so there has been significant like the five year average.

782
00:51:34,920 --> 00:51:41,760
 So years three, four and five were at or below that gray line.

783
00:51:41,760 --> 00:51:43,560
 I'm sorry, say that again.

784
00:51:43,560 --> 00:51:51,440
 OK, I'm just saying the five year average was noticeably lower than our last three years.

785
00:51:51,440 --> 00:51:57,680
 So that means the four years ago and five years ago were were significantly lower.

786
00:51:57,680 --> 00:52:00,760
 So we continue to see that significant growth.

787
00:52:00,760 --> 00:52:02,600
 Yes, sir. That's correct. Thank you.

788
00:52:02,600 --> 00:52:09,120
 Sure. So the water demand is a little bit higher than the other utilities.

789
00:52:09,120 --> 00:52:11,560
 You'll hear more about this in the next presentation.

790
00:52:11,560 --> 00:52:22,960
 And you heard a little bit in Tyler's presentation on why the water growth is projected at four percent with wastewater at three and a half percent until FY 28.

791
00:52:22,960 --> 00:52:37,280
 And then it slowly declines for electric. This is their residential and commercial service forecast.

792
00:52:37,280 --> 00:52:42,480
 So both of these are are lining up with solid waste projection rates.

793
00:52:42,480 --> 00:52:47,520
 So the the residential is growing at about two and a half percent.

794
00:52:47,520 --> 00:52:54,360
 And then the same for commercial, it's an average of about one and a half percent in the future years.

795
00:52:54,360 --> 00:52:59,480
 So this slide shows the same information in graph form.

796
00:52:59,480 --> 00:53:10,600
 And then the next steps will be back to you on June 12th and June 26th with our utility budgets presentation and the rates and then a follow up.

797
00:53:10,600 --> 00:53:20,240
 We'll ask for your approval on July 24th and then we'll begin our city council presentations following your recommendation.

798
00:53:20,240 --> 00:53:26,720
 And with that, I'll take any questions. Questions.

799
00:53:26,720 --> 00:53:33,000
 It's too early. It's too early to know what to ask.

800
00:53:33,000 --> 00:53:35,000
 Go ahead. I think you want to ask something.

801
00:53:35,000 --> 00:53:42,160
 I do want to ask each year you have a budget workshop with the city council.

802
00:53:42,160 --> 00:53:48,360
 Yes, sir. And we see the budget preliminary and then the revised.

803
00:53:48,360 --> 00:54:02,800
 I'm wondering if the board would be interested, but I'd be curious if it might be useful for us to consider having at least a mini workshop to go over the budget in more detail.

804
00:54:02,800 --> 00:54:15,400
 I mean, I think we'd be happy to have a workshop or if you make if you make the information available, that would be good.

805
00:54:15,400 --> 00:54:25,360
 Yes. So what we do with the budget workshop is we put all of the so for our supplemental requests, we request a white paper for each supplemental request.

806
00:54:25,360 --> 00:54:32,600
 And what that does is really explain the need, explain the cost, explain, you know, whether it's a one time recurring, how that fits into the bigger picture.

807
00:54:32,600 --> 00:54:34,600
 That's what we do with the budget workshop.

808
00:54:34,600 --> 00:54:40,600
 That's what we do with the budget workshop.

809
00:54:40,600 --> 00:54:55,800
 We do have the same for pub, wherever it fits, possibly on the July date where, you know, you're going for approval or if you'd rather have it at the follow up at the end of June, we could certainly do that as well.

810
00:54:55,800 --> 00:54:57,800
 I think I'd feel better if we got it in June.

811
00:54:57,800 --> 00:54:59,800
 We'd have some opportunity to review it.

812
00:54:59,800 --> 00:55:03,800
 Okay.

813
00:55:03,800 --> 00:55:05,800
 You don't need anything further, right?

814
00:55:05,800 --> 00:55:06,800
 Thank you very much.

815
00:55:06,800 --> 00:55:07,800
 Thank you.

816
00:55:07,800 --> 00:55:08,800
 All right.

817
00:55:08,800 --> 00:55:16,800
 Next, we will receive a report, hold a discussion and give staff direction regarding the update on the wastewater master plan.

818
00:55:16,800 --> 00:55:18,800
 They saved the best for last.

819
00:55:18,800 --> 00:55:21,800
 Yeah.

820
00:55:21,800 --> 00:55:29,800
 I am still Stephen gay and I'm still the director of water utilities and I even have my own presentation is called out.

821
00:55:29,800 --> 00:55:37,800
 So we're going to go through the wastewater master plan update.

822
00:55:37,800 --> 00:55:40,800
 We're going to talk about the phasing and growth that we've seen.

823
00:55:40,800 --> 00:55:43,800
 We're going to talk about the five year a little bit about the five year capital plan.

824
00:55:43,800 --> 00:55:52,800
 And we're focusing on both Hickory Creek Basin and the Clear Creek Basin of a watershed and then we'll discuss next steps.

825
00:55:52,800 --> 00:55:59,800
 So phasing and growth, we're projecting about an eight point one percent growth in population over the next five years.

826
00:55:59,800 --> 00:56:05,800
 Now, this this information is developed in concert with our development services team.

827
00:56:05,800 --> 00:56:07,800
 We've looked at the comprehensive land use plan.

828
00:56:07,800 --> 00:56:15,800
 We've looked at all of the projects that are currently under construction and or those in the development review process, evaluated them.

829
00:56:15,800 --> 00:56:19,800
 And that's where we're coming up with this number.

830
00:56:19,800 --> 00:56:22,800
 Looking forward, all good master plans, we want to look at a little bit further out.

831
00:56:22,800 --> 00:56:26,800
 So we took another we took a snapshot ten years out.

832
00:56:26,800 --> 00:56:31,800
 We're seeing that growth cool a little bit, dropping down to about an eight point five percent increase.

833
00:56:31,800 --> 00:56:38,800
 And then at the twenty five year horizon, we're looking at roughly about two percent growth rate.

834
00:56:38,800 --> 00:56:51,800
 If you notice the shading, it's just demonstrating the growth that we see the projects that we know that are on the books and that development services is having conversations with developers on currently.

835
00:56:51,800 --> 00:57:05,800
 So when we met with you in October, we we took a you know, the sixty thousand foot view and we looked way out and we said, hey, if we were going to build all this stuff today, this would be the conveyance, the infrastructure that we need to serve these communities into the future.

836
00:57:05,800 --> 00:57:10,800
 And that was a price tag of about one point two six billion dollars.

837
00:57:10,800 --> 00:57:21,800
 As all good master plans do we as the closer we get, the more data we get, the more refined our projections get, we look to see what's more realistic within that five year window.

838
00:57:21,800 --> 00:57:23,800
 We know that Hunter Cole is coming online.

839
00:57:23,800 --> 00:57:25,800
 We know that we have significant growth within our system.

840
00:57:25,800 --> 00:57:32,800
 And these improvements are what we believe is what's needed to support the growth, the future growth of this community.

841
00:57:32,800 --> 00:57:42,800
 Yes. And so now that's dropped from one point two six to five hundred and seventy two million, which is I think a pretty good reduction.

842
00:57:42,800 --> 00:57:59,800
 So looking out at the Clear Creek Basin, again, we looking at the growth, we're if you've seen anything that's happening along the Milam up in Milam Creek, which is on thirty five in Milam and Ganzer Road, we're seeing some unprecedented growth in that region as well.

843
00:57:59,800 --> 00:58:10,800
 This this snapshot took into consideration a couple of municipal utility districts at the furthest far north end of our CCN or our E.T.J.

844
00:58:10,800 --> 00:58:13,800
 That was a cost about three hundred and forty five million.

845
00:58:13,800 --> 00:58:20,800
 Again, with all good master plans, we've taken and honed it down, looked at that five year window, we see what's more realistic.

846
00:58:20,800 --> 00:58:26,800
 And this is the conveyance and treatment that we're looking for currently.

847
00:58:26,800 --> 00:58:45,800
 So with regards to conveyance total about two hundred and ninety three million and treatment facilities are roughly three hundred and five hundred and thirty two million for a grand total of eight hundred and twenty five million, which is less than just what we were projecting in the Hickory Creek Basin.

848
00:58:45,800 --> 00:59:03,800
 So our next steps, we're going to complete the five, ten and twenty five year improvement plans, refine those numbers, do the financial analysis, have another meeting with the P.B. and city council to review the final report or what we propose to be the final before we complete the report.

849
00:59:03,800 --> 00:59:06,800
 And then we'll we'll seek final approval once complete.

850
00:59:06,800 --> 00:59:16,800
 And then with that, I'll stand for any questions. Questions? Again, too early.

851
00:59:16,800 --> 00:59:20,800
 Okay. All right. Well, thank you. Thank you.

852
00:59:20,800 --> 00:59:30,800
 All right. With that, that concludes the agenda. Billy, do we have a motion to approve at nine fifty nine?

853
00:59:30,800 --> 00:59:36,800
 Okay, we are adjourned.