Feb 10, 2025 Public Utilities Board on 2025-02-10 9:00 AM

Good morning and welcome to the dually posted public utilities board meeting for February 10th. It is 9 a.m. Our first item of business is presentations from the public. Do we have any presentations? Moving on to our consent agenda, I've had a request to pull item A. Are there any other items that need further discussion? Chair would entertain a motion for items B through B. I move we accept items B through B. I'll second. Lee moves and Robert seconds. All in favor? Aye. Motion carries unanimously. Item A. My name is Paul Opine. I'm with DME engineering. Thank you for coming. I had a question when I was looking at this the other day. The aerial showing where the line is going through, are we, do we have customers in that area that use Denton electric or do we have a, I guess we have a co-op or some kind of agreement with Corinth? Can you help me with that? For sure. We have no customers there. That's not in our service territory and that power line just goes down to the pumps at Lake Lewisville. And so that's, oh, thank you. So that's, the line, that improvement going underground, but that's for the pumps, no one else. Is that what I understand? Yes, sir. Okay. And so would it be exclusively used for that without any other hookups later on in? That's my understanding. Yes. Okay. That's what I know. Thank you very much. Appreciate. No problem. Quick question. So it appeared from this, the city of Corinth is paying for this. Yes, sir. Reversing the city. Thank you. Any further questions? Would anybody like to make a motion? I move that we approve. Thank you. Item A, PUB25006. Second. Susan seconds. All in favor, please say, "I." I. Motion carries unanimously. Thank you. Thank you. Moving on to items for individual consideration. After approval of the January 27th meeting minutes, anybody like to make a motion? Lee? I'll move. I'll second. Thank you, Susan. All in favor, say, "I." I. I. And now on to, let's see, items for individual consideration. Item B, PUB24226. Consider authorizing the ... I'm sorry, I'm on the wrong page. Consider authorizing the submission of an application through the United States Environmental Protection Agency's WIFA loan program for financial assistance for long-term loans in a total amount not to exceed $770,970,583.07 to fund up to 49% of the project cost for water and wastewater plant and transmission projects, including transmission increases, system expansions, and system improvements for water and wastewater capital improvements program, and authorizing the payment of a $100,000 application fee. Good morning, members of PUB. I'm Stephen Gay. I'm the general manager for water utilities and street operations. If you bear with me for a moment while I pull this up ... There we go. All right. Technology is your friend. This morning, we're going to discuss our opportunity to submit our application for the U.S. Environmental Protection Agency's WIFA program, so that's the Water Infrastructure Finance and Innovation Act. The project overview, water utilities is planning. Our planning and engineering division is seeking $770,970,583.07 to fund our five-year capital plan. That was a 49% match with the US EPA. Some of the projects ... We're going to do this in two phases. Phase one, this includes all our capital improvement projects for both water and wastewater. Phase one is the water and wastewater treatment facilities. That's capacity upgrades, Apikon Creek Water Reclamation Facility, our Clear Creek Water Reclamation Facility, and our Ray Roberts Water Treatment Facility with major ... Phase one will also include major improvements to our distribution and our collection system to expand capacity. Phase two is going to include improvements on our lift stations, our sewer collection mains, and our water distribution mains and mains and replacements. The City of Denton is pursuing this loan as a master agreement with EPA instead of individual loans, and it gives us a lot of flexibility with the way that we're financing this over the term of the loan, and Jessica, who's our Chief Financial Officer, is here to speak a little bit more about that. The total project does include about a 20% contingency, and this is the advice of the EPA, that they wanted us to put in as much as we could foresee needing so we don't have to come back to them. Now, an important characteristic about ... We don't have to take all the money, right? So basically, we're applying for a line of credit with EPA, and as we need those funds, we get to draw down those funds, and again, Jessica will get into that piece in a little bit. However, in order to apply, we have to do an application fee, and that's a $100,000 application fee to cover all of the services and processing of the loan. So with that, I'm going to go ahead and I'm going to turn it over to Jessica and have her run through basically all the ins and outs of the loan, thank you. Good morning, members of PUB, Jessica Williams, Chief Financial Officer. I believe this is the second time that we're coming to you to talk about WIFIA, so what we're asking for right now, as Stephen mentioned, is the $100,000 for the application fee. We are looking at WIFIA as a tool in our toolbox to finance the water and wastewater CIP. We know that we have needs that we will need to finance outside of what we have cash available for. So in that discussion, when Stephen and I started that last year, we started looking at what are our options for us, who can help us to do this in the most financially responsible way. We started meeting with EPA, with the WIFIA team, and learned about the opportunity to apply for WIFIA loan funding. So the WIFIA loan funding can cover up to 49% of what our total costs will be. The 51% that the city is responsible for may be covered from multiple sources. So as you all recall, we went to the Texas Water Development Board and received $195,000 from them for part of one of our projects. That funding counts as part of our 51% match, as far as the EPA is concerned. So while we'll be working with Texas Water Development Board to receive those funds, we don't have to spend that money twice. We only spend it once, and EPA says, okay, that 195,000, that counts towards your match. The additional benefits of WIFIA is that it's going to allow us to work hard to ensure equity as far as our rate payers. We want the rate payer who benefits from the project to be the individual who pays for the project, right? That just makes sense. We don't want to overburden the entire system for projects that are going to be occurring in places like Hunter Cole before we have those developments completed. WIFIA gives us significant flexibility in when we go back into repayment and what that looks like. As Steven mentioned, we're only going to draw down what we need. So if we have used the funds, we will draw the funds down. If we have not, if things change, if things constrict in the economy, we are not committed to drawing all of this down. Conversely, had we gone just to the marketplace and sold debt, we would be committed to making those payments irregardless of what else happened. So this gives us significant flexibility. In preparing for this, my team has completed a retail rate study for the water and wastewater utility. We have a wholesale rate study that will be completed next week. So we're looking at what this looks like over the long term and how we can then smooth rates and increases as we go over time. So I won't read all of this here, but that gives you kind of an overview of why we are doing what we are proposing to do. >> Do we have a question on that slide? >> Yeah, we do. >> Yeah, let me go ahead. >> Thanks. Is this a straight reimbursement where our funds go in first and then they reimburse us for this? Are their funds going first, how's it work? >> So what we would do is we would look at this on a reimbursement basis. But when we get to the end, that's when we look at the 49 to 51. So if we've made changes to impact fees, for example, over this time and we've collected, say, $400 million in impact fees. When we get to the end and we're totaling up the year 49 to my 51, I have some additional resources that I will be setting aside to make that match happen. So we'll do that at the end of the term with WIFIA. >> And on the rate reset, is that permissible rate reset before any funds are drawn or before all the funds are drawn out? >> Before any funds are drawn. So if we start this application process now, we're looking at things, things change on the federal level. All of a sudden, rates drop significantly from the time that we start the conversation to when we lock in. >> Okay, thanks. To dovetail this, so it's $770 million in change. >> And seven cents, yes. >> And so, am I correct, that is the entire amount? >> No, that is the 49%. >> That's the 49%? >> Correct. >> Oh, then this number is? >> Yes. >> Line through that, that's not going to work. I'll have more later, but thank you, good. >> Okay. >> So following up on Mr. Newquist's question, when are these capital projects expected to start in relation to each other? I guess how many years until we kind of spend everything we expect to spend out of this? >> Stephen Gay, general manager of our utilities, a great question. A lot of these projects are underway right now, they're either in design phase or so like the Ray Roberts expansion is we have a contractor on site and we're working forward on that project currently. They're doing, that's capacity improvement, we also have CMAR selected for the expansion and we're, I want to say about 40% in design, 40 to 50% in our design. So we're moving forward, so all these projects are going to occur within that five year window. >> Okay, so there's probably Ray Roberts, sounds like Ray Roberts might be first. >> Yes, sir. >> And then- >> And we also have the Pecan Creek, which is our wastewater treatment facility. We're further ahead in design on that, that's about 60 to 70% on design. So we're moving at the speed of, whatever. >> Okay, so all of these will be, so probably like in less than a year, you will have begun spending this money. >> If we need it, if we need it, and that's the whole, the beauty of the program, right? It just creates this opportunity for us to diversify our financial portfolio. And where we need to take advantage of the federal government's AAA bond rating. And borrow that money, we can leverage that for ourselves. But if we have cash, and as Jessica alluded to, we're moving forward with our impact fee study. If we're generating those impact fees, we can use those to offset the need. So this is, in our opinion, is our worst case scenario. This is what we believe that we could absolutely leverage. But we're not going to stop working on the other side. Stop me if I'm jumping ahead, but I didn't notice it here. What is the competitiveness of the actual rate? I know you're talking about the competitiveness of the flexibility. >> Yeah, Jessica's much better, she's more equipped to talk about that. >> Yes, so the rate follows the treasury rate, right? So that's where this reset comes into effect. That could be very beneficial for us, depending on by the time that we get to closing the loans, where that rate is sitting. So for us, as well as having the ability to operate on the AAA rate of the US government, which the city does not have a AAA rating or AA, so there's savings there as well. We've seen these projects save communities between $19 million and $71 million. We will have those numbers back to you once we work through this application process a little bit further. And have some more concrete dates as to when we would be looking at loan closing. >> Thank you. So the project will be done in five years, roughly. So what would our normal repayment term be in a standard bond setting? >> So if we were to go out and just issue bonds today, we would start repaying on those bonds next year. So we would start repayment before the project was completed. In this instance, we have up to five years after substantial completion to start repayment. So that's where a significant amount of savings comes for us, is that we have- >> That's only 49% of the project costs, so the other 51% is coming from, I'm assuming, our regular bond program. >> It is coming from a combination of factors. As I mentioned, Texas Water Development Board, so that 195 million counts as part of that 51%. Then we will have impact fees, which as Stephen mentioned, he'll be coming back to talk to you all about. And then there will be a piece that comes from a revenue bond issuance. So this gives us flexibility to look at when we need to do that. >> So the revenue bond issuance would begin after the projects were completed, is that the general idea? >> That's the general idea of right now, yes, is that we don't have to do this until the projects are completed. The benefit to that is that development is going to occur either way, right? The homes are going to be built, we're going to have to put this infrastructure in the ground. None of these projects are projects that we didn't anticipate in our CIP. This is all work we knew was going to come. So the benefit here is that we can get to a place where the homes are built, the water taps have been established. We have rate paying customers added to our revenue streams, which will reduce the burden overall. There will still be a burden, there would be either way. But this will allow us to get closer to when we actually start to see revenue from development. Generally, we build a home, and that's great, and then someone buys it, and then a year later, it hits the tax rolls. And sometime in that year, it might hit the utilities. So it gives us the time and space to truly get to full revenue realization after the project is completed. >> So you're asking for approval for the application fee, so what are our chances of being approved for the program? >> I believe that our chances are very good for approval for the program. So the city of Denton took a little bit of a different approach to this. We went and met directly with the WIFIA team in person last year. And then we've worked very, very closely with Amelia and her team in DC as we built this program up. They have been tremendously helpful to us. Amelia herself spent a weekend just helping us put together these loans as programs rather than as specific projects. Allowing us to have one environmental for a total area rather than having to do multiple. They've really been very cost conscientious with us, and they have a lot of flexibility in the way that the WIFIA program works. So they've been fantastic. They've been great partners. >> The times they are are changing. You've been working on this for a year. >> Mm-hm. >> This program, how old is it? >> I believe that the WIFIA program has been in existence for about 40 years. >> And your relationship with the connection in Washington. My concern is, I wouldn't be surprised in a month, we don't have an EPA. And so I'm concerned about these programs surviving. And I'm hoping that we will get a lot of input from your connections so that as we go through this. We just have a heads up because it is so volatile right now. Am I just the little chicken or what's going on? >> I don't disagree. >> Okay, thank you. >> I will say that the programs themselves, both WIFIA and TIFIA, are long standing revolving loan type programs. The programs, I don't see any reason why the programs themselves would not survive. These were congressionally administered programs. Irregardless of what the agency may look like or what the agency's name may be when we get to that point. But yes, I've had those concerns as well. Last heard from Amelia last Thursday, and they're fully operational and good to go and. >> Well, before half time, we no longer have pennies, so I just, no concern. >> Yes, yeah, it's enough to make your head spin. >> Okay, I think we can move to the next slide. >> Okay, on that, yeah, on that very optimistic note, so this is just an illustration of the process. So we had project selection, there was a notice of funding availability that was issued by the EPA. We submitted a letter of interest that was evaluated by Amelia and her team. And then we were invited to apply, so that gives you a little bit more confidence in the process. In that, this starts with simply coming forward and saying, this is what we think we want to do. Here's our established CIP, here's what our council's already approved, and they said, great, now we're going to invite you to apply. So we've worked through the pre-application pieces with the EPA, and they have actually even reviewed, work on to the extent of even reviewing all of our documentation that we brought to you today. And now we are at the application submission point. So when we make the choice to recommend for the $100,000 for the application fee, then we'll start working through the application itself. We'll go through a negotiation process. Our financial advisor, Laura Alexander, is here. She's the city's advisor. She has been integral in this process, as has our bond council. We'll work with EPA's advisors and their bond council as well as we go through the process. And then we'll get approval and we'll close the loan. And then we'll start the distribution process. So as we go through that, my team will be on top of ensuring that we have both sides built at the same time. We're not just looking at what we're getting in loan funding, we're looking at where are we going to be able to secure our 51%. And how are we going to restructure internally our general ledger to ensure that we have that tracking in the manner that we know that the federal government is going to request. So that's our process as we work through. And it looks like I have one more, okay. So this was our timeline. About April 15th of '24, we issued our letter of interest. May 10th, we received our invitation to apply. We have until May 10th of '25 to apply. And then in Q3 of '25, we anticipate loan one approval will be granted by WIFIA. And in Q2 of '25, we anticipate loan number two to be applied for. And that's all that I have. So I will stand for further questions. >> Are there any more questions? >> You said this is the second time we've gone through with them. The disbursement process, can you tell me a little bit, is it timely? Does it have hiccups in it? What was our experience last time? >> So this is the second time that Steven and I are talking to this board about WIFIA. We have not had a WIFIA loan in the city of Denton prior to this. We anticipate that disbursement will be as quickly as we are on top of getting our requests in. So what I have done, I have a team member that I don't know that you all have met yet. But we have stood up a grants management and other funding sources division within finance. He and his team will be on top of ensuring that we're getting these in timely. We'll treat this in a lot of ways like we would any other federal grant. The federal grant guidelines will be stricter than WIFIA. But if we continue our structure and keep them the same, we will always be ready. >> Do we know anybody who's gone through this before? >> The city of Pflugerville did this several years ago. They started with their entire CIP and they went to WIFIA. They were, I believe, the first in the state of Texas, and they said, we're growing, exponentially, help us. So they've had good success. They actually just went for their second loan. I believe Mineral Wells went for a WIFIA loan. And we've seen several other larger entities throughout the state now looking at WIFIA. In the past, these types of programs weren't as popular in Texas as they're becoming now. >> So, right now, the only skin in the game that you're asking for is $100,000. >> Yes. >> And then we'll look at all the documents and you'll come back later and we'll see what we, moving forward. But right now, we're just voting on $100,000. >> Yes, that's correct. >> Thank you. >> Any further questions? So I just have one more just to understand the plan, while it's not completely set yet, the long term plan for repayment. We look at 770s with a 20% buffer, so that's 616. Our 51% match would be 640. We've already received about 195 million in Texas Water Development Board. So that leaves us about 450 million in kind of local match. Would that, then that would be revenue bonds, impact fees, rate increases? Are there other funding sources planned? >> There could be. If we were to receive additional Texas Water Development funding, that would qualify. If we receive anything from the Bureau of Reclamation, that also qualifies. So any grant funding that we can receive will also decrease that match. >> And then in the order of, you mentioned that we can kind of spend the money and then figure out the 51%. And then, so does that mean this 770 is kind of a line of credit? That we could build the first $200 million treatment plant and then identify $102 million in local match. But spend it all with WIFIA money to start with and then find the local match before the second loan? >> Yes. >> Okay. >> And I imagine that's what you intend to do. >> That is exactly what we intend to do. Yeah, which is why we've done all the studies, the retail rates, the wholesale rates. We've worked with Kimley Horne to put together an affordability workbook, looking at what do we need overall? If we have to do this this way, what does it look like? And I think we'll see significant savings. Because again, if I went to the market and issued debt tomorrow, we start paying on it next year. >> And impact fee adjustment, when's the next impact fee adjustment planned? >> I'll turn that one over. >> I believe, and I have Kyle in the room who can keep me honest. I want to say next week we have our first meeting with the Capital Improvement Advisory Committee. After that, we'll be coming back to Public Utilities Board and City Council with our recommendations. And we're also meeting with the development community, is that this week? With this week in the town hall, just to discuss where we're at. Nothing has really changed from the presentations that we've done in the past with the values in our approach. We're still looking at some significant increases to the water and wastewater impact fees. And we're looking at breaking it up into, in the wastewater side, the three basins and maintaining the three service areas on the water side. >> Are there any further questions on this item? >> I'll move approval. >> Thank you, Susan. >> [INAUDIBLE] >> Mr. Newquist seconds. All in favor? >> Aye. >> Any opposed? Carries unanimously. >> Thank you. >> So our agenda is management reports. Do we need to do it in that way? >> Do you want to do management reports now or do you want to do it? >> Okay, so we have one more item for individual consideration. We'll just follow the order of the agenda though. So next item is management reports. >> So Mr. Chair, members of the PAB, I do have a couple of dates that kind of came in after we sent you the agenda for future agenda items, so I just wanted to give you these dates. So June 23rd, finance is planning a financial update for you. And then July 14th, they're planning a budget workshop. I know some of you guys have asked me about that in the past, and so that's something they're planning to do. July 14th is a budget workshop. And then July 28th would be when the PAB would consider recommending to the council the utility rates and also the budgets. And so those are the three dates that are being planned. I think there is a date between the 14th and 20th, I believe, where we could come back if need be. But those are the dates that we have for you for now. And then going to the new business action items, we do have a question from the last meeting on the impact of federal tariffs. We are working on that memo and plan to get it to you at your next meeting. So with that, that is the management update. >> Thank you. Moving on to item 4A, PUB 25020. We consider recommending adoption of an ordinance to the city of Denton determining public use, need, and necessity for the acquisition of various permanent drainage easements and temporary construction easements. Generally located along Bernard, West Sycamore, West Mulberry, and Stroud Street between Carroll and Elm. >> Good morning, PAB board members. I'm Angel Delorey, senior real estate specialist with development services real estate department. Along with me today we have project manager Sheldon Gatewood. He can answer any questions you might have about design, alignment, or construction of this project. We are bringing this project to you this morning. It's a Pecan Creek phase three and four. This has a drainage improvement project and includes a large sanitary sewer line. We're looking for easements to purchase easements for this project. So this project will include 2,700 linear feet of reinforced concrete box for drainage. 2,300 linear feet of water line relocation and lowering. 1,700 linear feet of sanitary sewer line relocation and adjustments. And they will be repaving, reconstructing various roads. Those roads include Bernard, West Mulberry, West Sycamore, and Stroud Street. City plans to start construction quarter three of 2025 and be done by quarter four, 2027. It's 49 parcels we are taking to council next week to seek property interest rights in. What questions can I answer for you at this time? >> I am curious, we're asking for eminent domain authority. It seems you've identified all the pieces of property. Has there been an issue with purchasing those properties? >> No, not at all, not yet. These properties are in the appraisal approval process. We have surveys for them, we're ordering appraisals. So we will work with the property owners, make offers to them first, obviously, before eminent domain is discussed. So no issues with any of them. We reached out to all the property owners already, but no issues with anybody yet. >> Okay, so just curious, so why do we need eminent domain if we haven't gone through the procurement process, if you will? >> That's a very good question. So in the eminent domain process, as you may know, it takes a long time. It can be, so we're taking it to council to get eminent domain permission. In the event we can't come to agreement with property owners, we move right into the eminent domain process. And it keeps the project on time moving, so to speak. >> So it's more preemptive then? >> It is, ma'am. >> Okay. >> Yes. >> Could you go to the aerial, please? Thank you. So on the, excuse me, on the phase one and two, almost completed. On Warren, I like to call it Warren Street, could be Warren Court. Is that, that's been a new improvement. Is that, is that different from the, I'll call it the Creek Channel there on East Highlands? >> So are you talking about- >> Yes. >> Right here? >> Good, good, good, Mike. >> [INAUDIBLE] >> But you're correct. >> Okay. >> That phase right there actually happened with PEC four, phase one and two. So everything that you see right there is already underground. >> So there is, so then share with me the open creek area that's on East Highland, which is just south of Warren, the next street. Is that going to be closed, or what is that going to be used for then? >> No, that's not going to be closed within this project. For this project, what you see right there, the orange, green, and blue, that's just a phase four project, so everything on the channel that's going north will be closed from where we tie into at Pierce. >> So are they going to run parallel, or are you going to be running parallel to the Warren Court and the East Highland then, is that? And then they connect right there at Wainwright? >> No, they connect right at Pierce, where you see the orange dotted lines and the red, not orange dotted lines, but red dotted lines and the solid orange line. They connect right there at that point. >> So the project on Warren Street is complete? >> Yes. >> And that's how it's going to stay? This is moving up the next six blocks? I'm just curious, my office is over there and I just was wondering, you've got two drainage. And I was just curious as to, I was wondering if that was an error and it was supposed to be down to East Highland Street. That's what I was wondering, why it was open and is it just going to be, what's going to happen to that then? >> So that portion isn't part of this phase three and four project. We'll have to see with the capital improvement team as far as what needs to be done over there. >> Cuz there's water that still drains through there. >> Okay. >> So is it being split there at Locus and Warren? Or I'm just curious as to, that's just water from around there that's going into that open drainage where this other is all being collected up along the upper reservoir towards East Prairie. Is that what we're talking about then, really? >> No, sir. >> Okay, well, I'll talk to you later about it then. >> Okay. >> Thank you. >> That works, thank you. >> Further questions? So you showed a list of 50 parcels that you expect to be impacted and this general map, but there isn't a much detail on how large the impacts are going to be on the parcels. Or are they, the existing drainage is eight feet wide. And kind of the very back of a lot of the lots, kind of backyard channels. Do you expect those to be full, like will it stay approximately in the same footprint or need another ten feet or will it need like the entire lot? >> You want to go into detail? >> So the existing drainage right now, like you said, is about eight foot wide. The size boxes that we are putting in, especially for that orange section that you see there is going to be 16 by eights in their diameter. So it's going to be double the size as far as what we're putting in. So it will be warranted to, of course, increase our easement and, of course, with that easement increase we're going to acquire some TCEs as well. That way we can safely put those boxes in. So you'll see a lot of increases in easements throughout this project, just the sheer size of the box that's going in. >> And usually what is a typical surface easement on a six, if you have a 16 foot culvert, do you use like 30 feet to get a drive lane next to it or something or? >> It just depends what's around in that area. If it's a blank open field, typically you see around 25, 30 feet. But if it's more constricted in the areas as far as I know in this project, we'll see it next to a lot of houses. So we got to make sure that TCEs of course varying that way doesn't cut off property and, of course, property entrances to people. So it just varies for a project. >> And I wish you had included a flood map, an expected flood map in this presentation. I'm familiar that this area is in a floodplain effectively, like this whole, all those houses are paying flood insurance. There are commercial buildings that are in flood areas. So this is valuable to that, but we have to balance the value of hopefully removing all of these and maybe some additional properties out of the floodplain. But then how much impact will it have on the remaining properties? That's a hard thing to tell with just kind of the information in front of us. >> Good morning, Board Member Scott Feddick, Senior Project Manager with Capital Projects. We can, when we bring this project for construction, we can bring that with you if you'd like. Provide the map, what it's going to look like, what it's going to take out of the floodplain, the improvements it's going to have when we actually bring the project to construction. >> Thank you. >> And then kind of back to your question there on East Highland, that open drainage along East Highland right there. Yeah, it's going to remain that way for foreseeable future. It may be something we look at in the future, put it underground, but right now it'll remain an open channel. >> And where's that water coming from? >> Coming from, so it is coming from upstream. >> Okay. >> Upstream on this deal. So it will still feed through that channel connecting with this. >> Not that I'm going to be trout fishing, but I was just curious. You got two, looks like you got two drains going right parallel with each other, and that's all. >> Yeah, no, it's staying in a single one. >> Okay, and that, if I may, on the FEMA, if it takes it out of the floodplain, whose responsibility will it be to notify FEMA to get that map revision letter? >> So it will fall on our drainage department. >> So you all will do that for the owners? >> Yes, we'll work hand in hand with our drainage department with any of the FEMA requirements and things like that, yeah. >> But I mean, you'll do that for the property owners that have that property. Will you be assisting them for their letters of map revision? >> That, I don't know the answer to. I'd have to get with our drainage department and see if they would do that or how that actually works. >> Mr. Chairman, I'd like to at least get that information. When you come in and you show us the map and all, if you could give us that information, yes or no, it's just the way it is. >> For sure. >> That'd be very helpful, thank you. >> Yeah, we can include that. >> Thank you, sir. >> On the under Mulberry Street section on the north side of those homes from Bernard over across Carroll, that's an open culvert on the north side of those properties. Does that remain if we're putting things under Mulberry, or what's that going to look like? >> Yeah, that's going to end up going away, and it'll all be transferred to the underground boxes. >> So that blue, portions of that blue line will go away? >> Yes. >> Okay. So I think this is a complicated project in a long built up area. You're upgrading 100 year old infrastructure around 100 year old houses and businesses. So there are a lot of challenges and concerns here, yeah, what could go wrong. But I do feel like there's a lot of benefit. This area has been prone to flooding the entire time it's existed. So at this point, Chair would entertain a motion. >> I move we approve PUB 25020. >> Mr. Lieber, motions? >> Mr. Neuquist seconds, all in favor? Any opposed? >> Sorry, do you need to read it? >> I'm sorry. >> Yeah, you need to read the formal. >> So we will restate the motion. >> And then do you need to show the properties while he's reading the motion? >> I don't want to do that, I hope they're not hard work. >> So I move that we approve the PUB 25020 as Exhibit C as recommended motion. I move that the city of Denton, after having made the offers required by state law, use the power of eminent domain if needed to require various permanent drainage easements and temporary construction easements. General located, excuse me, general located along Bernard Street, West Sycamore Street, West Mulberry Street, and Stroud Street, and between Carra Boulevard and Elm Street, situated in the William Loving Survey abstract number 759, the MEP and PRR Company Survey abstract number 925, the Eugene Pachowski Survey abstract number 996, and the William and Neil Survey abstract 971, all in the city and county of Denton, Texas. And more particularly described in the attached Exhibit A to the ordinance now under consideration. And on the screen to be displayed to the audience, all of which are for a valid public use necessary to relocate, construct, and install permanent drainage infrastructure as part of the Pecan Creek 4 phase 3 and 4 drainage project needed to serve the public and citizens of the city of Denton. >> The motion's been restated. We still have a second for Mr. Newquist. All in favor? >> Aye. >> Any opposed? Motion carries unanimously. That is the last item we have for our public meeting and we'll now move into work session. >> Good morning, Mr. Chair, members of the committee. I'm Brian Berner, I am the Solid Waste Director for City of Fort Worth. These two items on work session A and B were erratically posted to work session, should have been part of the consent agenda. So really all we're looking for, I'll be glad to answer questions, but I'm just looking for a vote of approval to move these forward to council so we can enter into the agreements. Thank you. >> Do we have any questions on these items? So these are, are these new contracts or are these for the landfill? I was looking at the, we are talking about that, aren't we? >> Correct. >> Okay, and I was looking at the tonnage and I didn't write it down here, I apologize. But you have already, because we've talked about the landfill forever. >> Ever, yes. >> As these come in, what does that do to our life expectancy? >> This does not affect our life expectancy. That is, this tonnage is figured in as part of the whole life of the landfill. See, the city didn't landfill, like all landfills across the nation, what we call fixed cost operations. So whether we take one ton or whether we take 400,000 ton a year, it costs us the same amount to operate. Our state permit requires, you know, says you have to have a minimum of this much personnel, this much equipment, so on and so forth. So what we try to do to ensure that we can have sort of a hedge for lack of a better term on the revenue coming in, we carve out part of that tonnage that we need to receive to hold the rates as level as possible and put them into what's called a put or pay agreement. For the last five years, we have had contracts with Wise County and Little Elm to contribute a part of that tonnage. And what that does, it's about 125,000 ton a year that we bring in. It helps stabilize the revenue side of the operation so we can ensure that come at the end of the year, we're not short on tonnage and revenue to pay for the cost of the operation of the landfill. So this tonnage is actually figured into the life of the landfill. Total, you know, we take in about 1,200 ton a day of material. This is close to 10,000, so it's basically a week's worth of life off the landfill. >> And my question was directed more for the footprint and ooze over and all that. Now, excuse me, is this regular landfill and what about recycling? >> No, recycling, this is only tons disposed. And in fact, we have incentives in the contract. It's mostly for our big haulers. Like I said, we have about 125,000, 130,000 ton that we've contracted through put or pays. The larger companies that bring us waste, there's incentive in there for them to recycle. They get an offset, they can bring more tonnage in if they recycle more. These two, this is Little Elm and Wise County. It is bulk material they're bringing in. So it does not consider any sort of diversion or anything else that they are doing as part of this. >> And so, it's just the county operation, it isn't any of the municipalities. >> Correct, correct. >> Nothing else. >> Yeah, basically, they have a citizens bulk center. Their county residents can bring material and put it in their boxes, and then Wise County hauls it here for disposal. >> Do we have any other agreements like this with other communities around? >> Not yet. >> That's what I was wondering, yet. Okay, that's a good answer. >> And part of the bigger picture is you bring up a very good point about life in the landfill. And ideally, what we want to try to be able to do is to steer waste to us, but use that as sort of the carrot to increase diversion for other cities. So there's some things moving long term that we're looking at from not so much as a put or pay, but maybe guaranteed volume that if you can meet this much recycling, then we'll guarantee the volume. So you don't have to pay that to your waste hauler. And there's a few other things that we're talking about internally to incentivize that. And landfill space in the state of Texas is rapidly shrinking. So we're trying to squeeze every single day out of this landfill that we can. And you may have heard our commercial diversion article recently passed. We were working with local communities. Just in the last quarter, through diversionary efforts and us working with our business community, we've actually gained 45 days back in the life of the landfill, and that's in a quarter. And that's only with 50% of the commercial entities responding. So you can see sort of some of that work that we're trying to do that even though we're bringing in waste, we're contracting with people, it allows us to operate in a way that we can extend the life of the landfill. It's almost, a lot of it's almost inverse. If we're taking more waste, how do we extend the life, but it's actually used as an incentive in the long term. >> And not to get in trouble with our attorney and me being out of order. But I know some years ago, we had talked about maybe even looking for other sites for landfill if this one got too full. Is that something that could be considered in the far, far future? >> In the far, far future. I mean, currently we have 55 years, roughly 50 years left in the life of this landfill. But at some point in time, we're going to have to have a space to put waste. And it's part of our comprehensive solid waste management strategy. Our goals are 30% by 30, 40% by 40, 75% by 75. Putting this in place, it may become, instead of 50% or 50 years, it may become 70 years, it may become 100 years. And who knows with technology changing and AI and whatever initials of this alphabet soup that technology drives us. We may come to a point that this just becomes sort of a circular type thing. We bring waste in, we convert it, we push it back out. So it ends up, we don't need new property, we're able to do what we need to do. But again, that's technology that I don't have, that I'm not considering, that's not available to us right now. But 10, 15 years, who knows? >> Well, we were talking about that about 10 and 15 years ago. >> Exactly. >> That's why I was asking. Thank you. >> Any other questions? I just have one. The discount disposal rate, is that kind of set for all of these kind of bulk customers? Or is it each one negotiated individually? >> Each one is negotiated individually, and that's kind of unique when we talk about put or pay. Most landfills will say contract with this, we'll give you this set rate. We said no, our landfill value is more than that. So we've got five contracts with five different rates in them, or each entity has their own rate. They bid on the amount, we determined if that bid was appropriate. If we wanted to say no, we did a counter offer. So we're getting probably the best value that we can get for the waste that's coming in, recognizing we need that assured revenue stream. >> Okay, thank you. So we need a motion approving these two? >> A motion approving these two, yes. >> Second. >> Sorry, we'll need to take them individually. >> Okay. We'll consider item A, adoption of an ordinance of the City of Denton Home Rule Corporation, authorizing city manager to execute an interlocal agreement with Wise County, concerning the delivery of specified tonnage to the city's landfill by Wise County. >> So moved. >> Second. >> All in favor? >> Aye. >> Any opposed? Carries unanimously. And item B, consider recommending adoption of an ordinance, City of Denton, with the town of Little Elm, concerning delivery of specified tonnage to the city's landfill by Little Elm at a discount rate. >> So moved. >> We have a motion. And Lee seconds. All in favor? >> Aye. >> Any opposed? Motion carries unanimously. >> Thank you very much. >> Thank you. Our last item of business is adjournment. Can I call this adjourned? >> Yes. >> Okay. We stand adjourned.