May 20, 2024 Public Utilities Board on 2024-05-20 9:00 AM

>> Okay. It's 9 o'clock and we have a call to order the City of Denton Public Utilities Board meeting from Monday, May 20th, 2024. Nobody from the public has signed up to speak, right? Okay. So that's the first item. On to the consent agenda. Does any board member wish to pull any items from A through G? I see none. Do we have a motion to approve the consent agenda? Billy moves. Seconds? All in favor say aye. Aye. Bye. The next item is consider approval of the May 6th, 2024 minutes. Does anybody have any changes or corrections? Thank you. And do we have a second? All in favor say aye. Aye. The next two items we're going to call together, but we need to vote on them separately, so it's the bond issues. I can get that down to the right normal height, right? Randy Klingle, Treasury Manager, with a quick presentation for both items for this year's bond ordinance. For the Certificates of Obligation, we are required to do Notice of Intent, which y'all have already reviewed and went to Council on April 2nd. We posted those notifications in the Denton Record Chronicle on April 11th and April 18th, as required, two times in the consecutive weeks. And we also need to do the bond ordinance that we have in front of you today to Council within 46 days of that April 11th date, which we will be doing that in June with your recommendation today. So most of my slides are the remaining project list, which you also have in your backup, and those are the same items that y'all sell through the budget process. I will not be going into details, but we do have staff available in case you have any questions on those projects that are ongoing with debt funding. First we have solid waste, and all of these will show you two columns, the Notice of Intent, which we did in April, and then the bond sale items total as well. And you will see very little movement at this point in the game when we are doing the bond sale. For solid waste, we stayed at the $4.1 million. The utility projects for the water fund, we remained also at their $60 million from Notice of Intent to the bond sale. Wastewater as well, $55.9 million for their bond sale project list. Electric stayed consistent as well at their $60 million from the Notice of Intent. So in total you'll have your solid waste at the $4.1 million, all of your utilities for a total of $180,330,698 in project money only. We also will have a refunding due to utilities being a part of the refunding process that will flow into the GEO cell. So we are going to refund the 2014 series, both the GEO and the CEOs, in $62.9 million par, with a potential refund of $1.6 million. And you'll see where it's broken out in those funds below, between general fund, airport, solid waste, water, wastewater and electric to bring up to the $1.6 million. So our 2024 bond sale will total $262,330,000 with all things included. So my next step with your recommendation, I'll go to Council to execute this bond ordinance. We'll have a sale on June 12th and then we'll actually receive the proceeds from the sale July 17th. Any questions? Questions? I have a question. Go ahead, Lee. Oh, it's already here. Go ahead. On electric, what's your current ordinance? How does the ordinance treat new construction on the developer's cost for connection of the distribution? Yeah, so our line extension policy, if you're in our single certified area, you pay 100%. If you're in a dual or triple certified area where we're competing for development, it is a negotiation process. And so normally developers are required, if they've gotten a quote from Encore co-serve, to share that with us and then we either match it or beat it to get them to choose the municipal electric. But we look at a five to 10 year payback on any investments that we make in those areas. And so if it makes sense financially, then we'll go ahead and submit that proposal. And that's only considered in the triple or double certified? That's correct. You may recall DME for a long time would do the first 300 linear feet within the single certified area. There was really no rhyme or reason to that. And from our standpoint, they have to choose DME and so it didn't make sense for us to be offering that on top of other incentives that the city was already offering. Well, there was a reason for it and the reason was to promote development in the city of Bitten. But that's not really a problem anymore. That's correct. So does the developer have the option to put competitive bids out for that action? To buy the equipment and lay the lines in? Yeah, I think we've had a couple opportunities where we have worked out some deals with some developers if they're able to get equipment faster than we are. But again, it's kind of on a case by case basis. I'll just point out that in many of the developments that were happening in the city, that 300 foot per linear foot was basically paying 100% of everything. And so that was one of the reasons why we looked at it a little bit closer. Okay. I'm just curious how things have changed. Thank you. I have an informational question. So when you opened this presentation about the COs, that's the certificates of obligation? Yes, sir. Okay. So at some point, we actually issue bonds or those general obligation bonds, so CO, GEO. Right. We are issuing GONCOs this summer sale, but the purview of this organ is your board, excuse me, is the certificates of obligation. The GOS will be based on the 2019 and 2023 bond program that were voted by the citizens. Okay. So they are sort of two different things, one, but one follows the other. Right. Well, solid waste is kind of included in the general government side, but we consider it a utility here at the city. So it comes to you guys with all the other three utilities. Okay. Thank you, sir. Just sitting up. Okay. Any other questions? All right. Do we have a motion to approve the first one? PUB24090 for 151,660,000. So moved. Thank you. Second. All in favor, say aye. Aye. Okay. And then PUB24091 for 262,330,000. I move approval for that. Thank you, Billy. And do we have a second? Seven seconds. All in favor, say aye. Aye. Thank you. All right. Management reports. So Madam Chair, members of the PUB, the first time just to cover real quick is the future agenda items. We did initially have on this schedule to make some budget presentations, made the decision kind of late after we had put this together to move that. And so that actually come to you I think on the 10th will be the first one and then it'll be a series of presentations then. And so other than that, there's really no other changes to that item. And then we have the new business action item. We still have the one item that we've been carrying out for a while. But I'm happy to answer any questions that you have. I do have one other item after we -- after you have any questions or not, so. Any questions? All right. Okay. I'm going to go up to the dais for that one and just wait for Cassie. All right. So just really quick, you know, this is one of those opportunities that we get from time to time to recognize some of these employees that have been doing fantastic work kind of behind the scenes. And so I'm going to ask Kim to come up here real quick. I know Kim, I always like to not be in the limelight, so I'm going to ask her to come up here real quick. You know, Kim's been a long-term city employee and has overseen the PUB for many, many years. For those of you that may or may not know, Kim has notified us that she plans to retire. She still hasn't quite given us a date. And so over the last couple of months and weeks, we've been working on a transition. And so you may have seen Cassie Blackburn back here. And so Kim's been working with Cassie to, you know, by mentoring her and doing a transition. And so we just want to recognize her today for what she's meant, not just to this board, but certainly to the city and certainly to city staff. And so on behalf of Stephen Gay, Brian Borner, Michael Gagne, who's not here today, and myself, you know, the department heads for the utilities which she supports, we just want to present her with a gift and tell her we thank her for all her work. I'll tell you, she has saved many of us many, many times, right? And trying to get items put together and submitted on time and making sure that everything is up to par and ready for you, right, to be able to review the information and be able to make decisions on behalf of our community. And so again, she's one of these unsung heroes. We all love her to death and think she's fantastic. We certainly didn't look forward. I didn't look forward to this, but I think it's a good opportunity for us to recognize her today. And so I just want to, on behalf of us, just thank her for everything she's done. Kim, thank you. Thank you, Kim. I have loved PUB. I have loved it from when Billy was on it the first time. This has been really important to me and I'm so glad I was able to do this for so many years. It's been really important to me and I have a great, a great boss that lets me do the things that I love to do. So thank you. We appreciate everything you've done, Kim. Thanks for the calls on Sunday asking me if I'm going to be there tomorrow. All right. Then we're on to concluding items. Does any board member wish to have a future agenda item or say anything to the public? Okay. Seeing none, we'll go into our work session regarding the redevelopment of the closed Mosley Road landfill. That was a hard act to follow. So yeah, I will do my best. Again, Kim, thank you very much for all your hard work and support of the PUB. But today I'm here to talk about some proposed redevelopment of the Mosley Road landfill. A couple months ago, City of Dent received a letter from the town of Crossroads requesting a long-term lease on the Mosley Road landfill. Basically, they want to create a city type park and I'll talk a little bit about the Mosley Road landfill, what it is, why we have it there. But before we made the decision to say, yeah, let's go ahead and long-term lease as we wanted to really float our options out there and really see what the PUB and council had to say about what we're proposing here. So with that, I want to take a few minutes here to talk a little bit about the Mosley Road landfill, delineate some of the regulatory requirements that we would need to address as either releasing, selling, whatever, renting the facility, examine some of these repurposing options, and then hold a discussion, receive direction regarding those options that we have. For those of you who'd be on the PUB more than a minute, you've probably seen part of this presentation before, so I apologize for that. But we are solid waste. We like to recycle. So the Mosley Road landfill is really, it's the third landfill that the city didn't ever had. I can tell you where one of the other ones was, and for the life of me right now, I can't remember where the first one was. So we'll talk more on that after the meeting if you'd like. But it's approximately, yes, sir? Just a quick question for my reference. Where is the town of Crossrookers? Basically, it's the intersection of 377 and 380 as you're going east on 380. So you cross over the bridge, you get to the discount tire, you get to the 711, you go under the bridge, you're airing into Crossroads at that port. So the site itself is about 74 acres. Forty of it was actually used as disposal. The remaining 35-ish acres was actually used to mine soil or borrow to cover the trash as it was put in. You'll notice that the solid waste permit was number 13. Currently, our permit is 1590. So there's been a lot of landfills permitted since this is one of the very first landfills that was permitted in the state of Texas. And we actually operated as a regulated facility but unpermitted through the Department of Health prior to that. It was just in 74. That's when the state started permitting these things. So we've actually had this site since about 1960. The site closed in 1984. It has completed post-closure monitoring. So really, all we're doing right now is maintaining the site. A couple of months ago, we approved some erosion control and water drainage work that we're currently working on right now. It's actually located in Denton County proper. It's bounded on the north, east, and west sides by the town of Crossroads, but it is not located in Crossroads nor in their ETJ. The town of Crossroads made a conscious decision not to include it in their ETJ for purposes. And again, this was in service from about 1975 to 1985. Just to give you a quick understanding where the location is, these two roads that run north and south, this is Mosley Road, this is Tips Road, or excuse me, Potter Shop Road, Tips Road, and we have the property that's right in here. So when you look at the facility, this is about 74 acres. Forty of it is disposal property, and then the rest of this is just bare land that we have scraped soil from and mined. It's actually a very nice piece. If you didn't know it was a landfill, you'd think it was this nice wooded hill and grass. We found deer antlers and all sorts of wild animals out there. It's a very good nature area, but again, it's just on that south area of Crossroads. It's growing, so I think there are some opportunities. I understand why the town of Crossroads would like to use it for recreational facility, but again, there's some other options that we've looked at. About three years ago, we brought this forward to, we talked with Gary Pack and our parks director about possibly creating a biking facility out here. At that point, the council decided that it was basically too far from the city of Denton and too far spread out and excluded given that it's on the other side of Lake Louisville. So it really didn't meet the recreational needs of the Denton County or the city of Denton residents. So it's been laying fallow since that time, but again, it's time for us to look at this option again. Regulatory requirements. We are bound to do what our permit says, but also what state law says. Even though this is a closed facility, the permit has been rescinded because it is a former landfill site. 30 TAC, chapter 330, what we call the sub-chapter T rules, they do regulate what can and cannot be done on top of closed landfills. It allows limited commercial recreational use. It prohibits residential uses. It prohibits penetrations of the landfill cap. It doesn't allow you to do certain things in building closures, but again, you know, the things you can't do are very minor. What you can do, it really opens up a lot of things, especially from an open space standpoint. Any onsite operations must protect and support the maintenance of the existing area of the proof cap. And again, if we chose to sell this property, we have to give notice that this is a closed landfill and any development must be in compliance with sub-chapter T. From a repurposing standpoint, we could maintain ownership, really do nothing with it. We've been doing nothing with it for 84 years except investing a little bit of money to maintain it, and you know, and that's good. Or we could, you know, do some recreational use, but again, you know, it's a little far away from city of Denton. We could look at creating an energy park, some sort of hybrid multi-use. We could look at selling the property right now. Again, you know, there are about 30, 35 acres of that that are unaffected by the landfill, which could prove to be, you know, enticing to some developer. But then also, you know, somebody may want to rent or lease the property, too, at some point in time. So from a due diligence standpoint, we need to look through all these options. As I said, the city of, or the town of Crossroads has reached out to us. They do want to invest and enter into a long-term lease with us to develop some recreational use for the residents and the citizens of Crossroads. This would have to be a market value lease. There could be some offsets based on maintenance or other investments they could make, but again, they would have to make that agreement. But what we would ask to do is complete our due diligence related to the potential sale lease or rental of the closed landfill, and then go ahead and contact the town of Crossroads and continue finding out exactly what their wanting needs are and see if we can come to a meeting of the minds, and if we can't, take that next step and take it out onto the open markets. So with that, I'd like to answer any questions you might have, see any discussion, get what kind of direction you might have on this. I see Mr. Rybeck's pushing his green button. Go ahead. Yes. I have a question. So when I originally saw this item, I thought it meant that you were considering reopening the site because of the problems we have with the landfill we currently are using is getting pretty full and trying to properly develop that property itself. So I thought, oh, I can go back and use this, but that doesn't appear to be one of the options. No. One of the reasons that the landfill is closed right now, first of all, it is a very old landfill. It's what's called a pre-subtitle D, and in order for us to bring it up to compliance, it would be very expensive. But secondarily, as part of the closure, we made the commitment to the town of Crossroads that we would not reopen it. And from an existing landfill standpoint, we've only used about 22% of the capacity we have permitted currently in our facility. So I don't want anybody to misunderstand this. We will never have plenty of landfill space, but right now we're okay. All right. It was interesting when I read the item and looking at the agenda, I thought it meant you were looking to reuse the space to help with the congestion, if you will. No, this is just an outpost that we own, that we invest a little bit of dollars in, and I just want to see if there's a better use for it. Go ahead. With a sales agreement, is it possible under the ordinance that we're compelled to follow to transfer any of our obligations over to the buyer? When you say obligations. What we are obligated to do under the landfill ordinance or whatever? Yes and no. In most environmental law, and again, I'm no lawyer nor do I claim to be, but I've got 30 more experience, so I've trained a lot of lawyers in environmental law. But one of the things that we understand is there's this concept of cradle to grave. You're responsible for it from the minute you put it there until the end of life and beyond. So we are never out of that chain of title. We are always responsible for something. However, in this, we can say any maintenance to the cap, any mowing, any improvements as far as drainage, blah, blah, blah, that is the responsibility of the lessee. And if we find that needs to happen, then we'll make notice to you and you shall, for a performance standpoint, you shall make those improvements within 40 or 60 days or whatever that time is. So yes, some of those minor maintenance is, but at the end of the day, if there's a long-term environmental issue, we're still on the hook. So basically, if it's not been disclosed or we didn't know what's there, which I'm sure sometimes is the case. Yeah. I said sometimes is the case. Sometimes, yes. Most of the time is the case. Then that part's just always the question. It will always be a question. That is correct. But given the age of this landfill and knowing what Denton County was like back in the '60s through the '80s, we've got a very fairly good understanding of what went into the facility. It's not some massive hazard that we're anticipating being at the site. It's standard household trash and a few other odds and ends. You're making a lot of construction debris. A lot of construction debris. Correct. Correct. That's all I got. Your turn. Go ahead. Thank you. I think I share some of Mr. Cheek's concern. So we have a permanent responsibility for the landfill portion of this. I would love to see this in its best use and the idea of leasing for recreation or selling the peripheral areas that do not have landfill under them. All those seem like interesting ideas or the energy park, a city use that's more than mowing it once a year or something like that. But I just want to make sure that whatever option is considered, that we consider our permanent responsibility to the property there. That is first and foremost on our mind. Whatever we do will be in the best interest both from a fiscal standpoint as well as a risk standpoint to the City of Denton. I could see options of selling it, but I see that you never know if we sell it, who is going to own it 10 or 50 years from now. So I think my biggest concern would be long-term leases for any number of uses, even something like a development, but selling it to another city who then might sell it for another purpose or selling it to a developer. I think all of those open kind of risk in the future where if we have a lease, we can have terms in the lease of, like you said, maintenance, 60, 90 days to remediate. So I think that would be my biggest concern would be an outright sale. Thank you. But my understanding is even if we did sell it and I'm not in favor of that, they still have to follow the law. Correct. So. Correct. And so do we. And so do we. And we would. I trust us to follow the law more than I trust somebody else. I understand. All right. Well, based on this discussion, I will continue down the road of talking with the town of Crossroads and then looking at other options to that fall through. Okay. Okay. Thank you so much for your time today. Thank you. All right. That is our agenda. Do you want us to? So, Mr. Chief, would you like to move to. I would like to thank Kim and tell her how much I enjoyed working with her all these years and getting, like I said, a lot of contacts on weekends. Yeah. You know, Cassie's been contacting me lately, but I think that's you're getting used to this role. But Kim has always done that. And I really appreciate the fact that over and above and okay, it's six o'clock on a Sunday morning. But yeah, well, I'll get this done today. Hopefully, hopefully you got paid for those hours you were working that weekend. So anyway, you've been great. I enjoyed being around you now that we can actually be personal friends. That's great. You know, you know. So anyway, thanks a lot. And back in the day when you had to run the agendas out to us, and I know that was a drive for you. So yeah, back in the day, boy, that sounds old, doesn't it? All right. Well, I would like to add my comments. I don't have any back in the day, but I sincerely appreciate all of your help in the time I've been on the board. Thank you. Keeps us out of trouble. All right. So that was a motion to adjourn. We're adjourned. 925. All right. We could sit here.