Good morning and welcome to the regularly scheduled Public Utilities Board meeting for
August 25th 2025.
It's 9am and we are starting the meeting.
First are there any presentations from the public?
Seeing none we'll move on to the consent agenda.
Does anybody wish to pull an item for discussion?
Seeing none we'll entertain a motion.
Move approval.
Susan moves approval.
Lee seconds.
All in favor say aye.
Aye.
Motion carries unanimously.
Now moving on to items for individual consideration.
Item A is consider approval of the August 11th minutes.
Do we have a motion?
So moved.
We have a motion.
Second.
And a second.
All in favor please say aye.
Aye.
Motion passes unanimously.
Item B is consider adopting a rate schedule for ECALL effective October 15th.
We have a presentation and discussion planned in closed session due to competitive matters
on this.
So we will hold this one until after the work session and the closed session.
Moving on to item C. Let's see.
Consider recommending adoption of a contract with Mayhill renewables for a renewable natural
gas facility at the landfill.
Good morning everyone.
Brenda Haney director of solid waste with the city of Denton.
Happy to be here with you this morning.
Bring this project hopefully home.
It's been a long one.
So just a quick little run down of where we've been on this project.
We have an active gas collection system and we currently flair that and have been doing
so for a period of time.
That is a currently we're treating it a little bit as a liability but we want to turn that
into an asset.
And so we are working to execute this agreement that will move us forward, will give us a
beneficial reuse of that landfill gas, lessen our carbon footprint and turn something beneficial
and profitable out of one of the nuisances of owning and operating a landfill.
So just a little bit of a background.
We had a landfill gas to energy facility that has operated up until 2020.
That facility was shut down and ultimately decommissioned.
We started the process again to look at what our options might be going forward.
And we specifically wanted to go forward with a project to refine that gas and turn it into
a high BTU fuel.
In 2023 we issued an RFP that staled during the negotiation process and now we issued
another one in 2024 and I'm happy to say it's been a long process.
We are here today and we've got representatives from Moro Energy with us so that we can move
forward with this project.
They were selected for this, just a little bit of history.
Also at the system out there we have 139 gas wells that are currently in place and that
gas is collected and simply flared off.
So again, I told you this has been a long process.
So we've got Moro Energy, they'll be doing business as Mayhill renewables on our site.
They'll assume the operations of our well field, expand that, I'm assuming expand that
well field, improve the overall gas collection that happens out there and they'll clean and
compress that and sell that.
And the open market, largely as a high BTU fuel, put it in the Atmos line most likely.
So at this point we're asking for approval to execute both the lease agreement and the
gas rights agreement and with that I will stand for any questions.
Susan do you have a question?
Remind me why we stopped doing it in 2020 and decommissioned.
I was on the board, I should remember but I don't.
Well I wasn't here and we were just having issues really where we weren't having a very
effective system and we were having problems with the contractor on that and so we wanted
to get out of that project and get us into a more beneficial project going forward.
So it's kind of obsolete and this is new stuff.
Alright, thank you.
We have an old antiquated flare that we're using now.
This is just a curiosity question but had any consideration ever been given to having
the city vehicles use this gas?
There has been some consideration that was part of what was trying to be done in the
past wasn't terribly successful.
There are a lot of different fueling systems being considered out there for all city vehicles,
garbage trucks in particular.
Right now most are being run on some sort of electric is kind of in vogue right now
and there is some CNG that is out there.
We've had CNG, we've seized operation on that.
If it comes back around to being something that is feasible and practical and something
that we can do, we'll certainly look at that.
I'm just curious, I lived somewhere once where they did that and they took the gas and used
it in their vehicle.
Right.
Thank you.
Yeah, yes sir.
This is somewhat related.
I was curious if the landfill is still operating the ELR system.
We are not currently operating it.
It will be something that we'll consider as we go forward.
I know has been some past controversy about the benefits of that system.
One of the things that happens with the landfill is throughout its life and later in its acceptance
of waste we start to really kick off that gas production and that number goes up.
One of the things that the ELR system allows us to do is accelerate that degradation of
the waste and then capture that gas a little quicker and while we're there.
So that's something that we'll consider as we go forward.
We're going to reassess whether there's some validity to moving forward with an ELR system
again.
Okay.
Thank you.
Any further questions to entertain a motion?
I'll move approval.
We have a motion and a second.
All in favor please say aye.
Aye.
Any opposed?
The motion carries unanimously.
Awesome.
Thank you.
And now we'll move on to section D management reports.
Good morning.
There are no future agenda items nor are there any new business items listed.
If nobody is requesting any new items we'll move on to our work session.
Chair board members, Krista Foster, customer service manager and I'm here to give you a
utility billing update.
So as part of our background last year city council approved funding for us to conduct
a review on our billing practices and collections policies and so we brought in an independent
consultant who conducted staff interviews, did call evaluations, looked at our performance
over time, collected some of our policies and then compared those against benchmarks
in the industry.
So what we're going to do is a high level review on the benchmarking and revenue trends.
And we're going to look closely at our commercial deposit practices, payment arrangements and
leak adjustments.
We'll do a quick summary at the end and then open up for questions and discussion.
So as you can see over the last five years Denton has performed very consistently and
against the benchmark standards of the industry Denton is outperforming those industry leaders.
So we have provided very consistent revenue and collections performance over time with
exception of the pandemic you can see that slight uptick during the pandemic.
This is comparing us against 100 different U.S. utilities and 22 of those being Texas.
So in reviewing commercial deposits what we ask is that she look at it and see how do
we compare with what private industry is doing what other municipals that provide electric
are doing and what we found is our calculation is consistent.
Our application of supplying deposit interest is consistent that our retention period is
not aligned with the majority of the cities and that our current ordinance is written
in such a way that it requires us to manually screen every account before we can do a refund
of a deposit.
So what is being recommended is that we retain residential deposits at 12 months as we do
today that for commercial deposits that we refund at 24 months of good payment history
and there are qualifications instead of no late payments no disconnections no whatever
are an A credit rating with our system no disconnections no meter tampering and that
your account is current.
The reason that we're looking at 24 months for that deposit retention is that commercial
new commercial businesses carry a higher risk 72 percent of commercial new commercial businesses
and didn't close within two years.
So this would hold the retention rate to cover that risk and that is consistent with the
overall community that they have those who refund deposits average at 21 months.
So payment arrangements what we found is in the review that the way that the ordinance
is written we have date calculation that's manual so it increases the likelihood of human
error.
It creates an arbitrary date for a customer to remember that our eligibility and administration
is restrictive because we only allow one adjustment or one arrangement per six months and any
deviation to that ordinance guideline would require council action.
So if that customer has had one arrangement in the last six months they've now experienced
a water leak and have a two thousand dollar bill.
We would have to go to city council to be able to do something to work with that person.
So what we are looking at recommending is moving the due date to be your current bill
date that way it's always clearly marked on your bill customer has easy access to it.
It's already on the screens that the representatives are using so there's no manual calculation
of dates that we remove the number of restrictions on from being this is how many arrangements
you can have to instead you can have as many arrangements as you need as long as you're
fulfilling them.
If you're failing to fulfill them this is when we have to apply additional work with
the fields and with staff on trying to now remedy that account.
So if you failed two agreements in a 12 month period of time that you have a 12 month restriction
of not being able to set an agreement and then we will allow you to do that again so
that there you're holding them accountable.
Then we want to look at updating the ordinance to authorize the program authority to the
manager and then discretion to the department head for anything that would be a exception
to the rule and then make sure that we ensure that city council has full notification before
any program changes are made through something like a Friday report so that they can bring
things back in if there are questions or concerns so that city council would still maintain
oversight on that program.
And then leak adjustments we ran into some inadvertent wording problems from when this
came through a couple of years ago so we want to make sure that we get those corrected and
make sure we're in alignment with other cities.
So what we found is the places that we are not aligned with other cities is the process
for a leak adjustment is hard coded in city ordinance.
So any deviation to it would require council intervention that they found that our filing
time was a little shorter than what the benchmark showed and that we had a little bit of a restrictive
policy in comparison.
We didn't have consideration at that time for AMI metering for water and lower customer
eligibility because we had an again oversight that the language excluded renters because
they cannot pull a permit.
So what we're looking for is we're going to revise the restrictions so that residential
customers there would be no cap but commercial customers would cap their loss at one hundred
thousand gallons.
We've been asked to add a provision for sprinklers and pools but we would cap that at five thousand
gallons and at a reduced rate over what a normal leak adjustment would be.
So that way there is some provision for those customers but it is going to protect the city
from significant cost.
We will increase our submission deadline to 60 days and then we need to update the ordinance
to make sure that the provision for renters is included and again authorizing program
authority to city manager discretion to customer service head of customer service and then
council getting provisions for any changes are made and add language for AMI metering.
So in summary collections is performing better than the industry and it's doing so consistently
and more effective and cost efficient and then we want to say our recommendations is
to work on being more responsible responsive to customer needs in the way that we're doing
commercial deposits payment arrangements and leak adjustments and with that I'll answer
questions.
Do we have any questions.
Customer service there are always questions going back a few slides where you're talking
about your deposit requirements and you have the credit rating of a what are you using
to determine that credit rating.
So it is an internal scoring system that evaluates the number of late payments disconnections
and other payment anomalies.
So it is calculated automatically on a 12 month rolling period.
So it's an internal metric based on our correct and it is defined in city ordinance.
And if customers don't need that credit rating are they able to get an understanding of why
they're not meeting that if yes yes we can go back and be able to explain that.
Yes I'm curiosity back on page prior to the summary it appears that the program authority
goes to the city manager and then the head of customer service whereas on the other remarks
it went from the city manager to the department head.
This is the same the head of customer service that department head but that doesn't include
the department head just a city manager.
So I'm curious should the department head also have that discretion rather than wait
for the city manager considering the breadth of that person's duties.
What's listed is program authority to city manager meaning the city manager can approve
like what the program guidelines are oh changes to the right.
I'm sorry my apology I was thinking in terms of you know actual approvals whereas before
you know that would go through the department head very well thank you.
Any further questions.
So I think this you know looks like a good plan removing that requirement of having to
go to city council putting that authority in staff I think is appropriate these programs
probably need to get adjusted you know every few years based on changes in the market changes
in the community so I think I feel like that's an appropriate plan.
Anybody else have any guidance to staff.
Do we need to approve this to move forward or this is just informational yeah and any
guidance anything that you'd like to see.
I mean I think that's impressive the results that you guys have had thank you compared
to the industry average.
And now we will move into our closed session the public utilities board at 917 a.m. will
convene in closed session to deliberate the closed meeting items set forth in the agenda
which are the following pub 25153 deliberations regarding certain public power utilities competitive
matters under Texas government code section five five one dot zero eight six.
The public utility board has now at 927 a.m. reconvened from closed closed session and no
official action was taken.
We will now consider individual item for individual consideration item B adoption of an ordinance
establishing the schedule of rates for electric service for ECL.
Our transmission cost recovery factor so just a quick overview of our current rates our
native load ECA is set at point zero four six two cents per KWH does provide a buffer
of plus or minus twenty million dollars for our ECA balance and we're not recommending
any changes for this.
Our large load ECA is currently at point zero five one five cents per KWH buffer of zero
to twenty million dollars and our transmission cost recovery factor rates are shown here
and we're not recommending any changes for this.
So our large load ECA we are recommending an increase to point zero five seven seven
cents effective October 15th our native load ECA forecasted account balance is shown here.
If we maintain the rate of point zero four six two cents we will have a balance of nineteen
point six million dollars by June of twenty twenty six again that account balance buffers
plus or minus twenty million and our TCRF forecasted account balance as long as we maintain
our current rate of point zero one seven six we will have a balance of six hundred and
twenty three thousand by June of twenty twenty six.
So our staff recommends an increase to our large load ECA effective October 15th again
that's increasing it to point zero five seven seven cents and we would need a vote on this
ordinance today.
Is there any discussion or questions.
Chair would entertain a motion like a motion from Mr. Newquist and second from Mr. Rybak
all in favor of approval please say aye.
Any opposed.
Motion carries unanimously.
We have no further business so we are adjourned.